On Monday the Alcohol Tax and Trade Bureau (TTB) proposed a rule that, if enacted, would significantly alter the way that appellation names can be used on wine labels. Specifically, the proposed rule – issued in Notice No. 147 – would allow wineries to use single state appellations of origin on labels if they are in an adjacent state.

Currently, Federal law states that, in order to use an appellation of origin, a wine must be ‘fully finished’ in the state in which the appellation lies. That is to say, a Washington-based winery, for example, cannot use an Oregon located appellation on their label. The proposed rule would broaden this to allow adjacent states to use single state appellations.

The proposed rule came about due to the recently approved The Rocks District of Milton-Freewater appellation. This viticultural area is a sub-appellation of the Walla Walla Valley, which spans the Washington and Oregon border. However, the newly approved Rocks District is wholly located on the Oregon side of the Walla Walla Valley. This means that, under present law, producers that are located on the Washington side of the Walla Walla Valley (or elsewhere in the state) would be unable to use The Rocks District on their labels because that appellation is wholly located in Oregon. If this proposed rule is approved, this would no longer be the case as Washington is an adjacent state.

The TTB states that, “The proposal would provide greater flexibility in wine production and labeling while still ensuring that consumers are provided with adequate information as to the identity of the wines they purchase.” Winemakers would have more choices as to where they finish their wines and what appellation labels they use. Growers within a single-state AVA – such as The Rocks District – would benefit as they might have more buyers if adjacent states were allowed to label their wines with an appellation name. Additionally, the TTB says, consumers would benefit from having more accurate information on the origin of a wine if wineries in adjacent states were able to use a more specific, single state appellation of origin.

The proposed rule would align the requirements for using a single state appellation of origin with the existing requirements for using a ‘state’ appellation of origin. At present, wineries may label their wines with a state appellation if they are in an adjacent state. For example, wineries in Oregon that use fruit from Washington may bottle their wines as ‘Washington’ but not with a more specific, Washington-located appellation. If this proposed rule is approved, Oregon and Idaho wineries, for example, would be able to use single state, Washington appellation labels and visa versa.

Notably, the proposed rule change would not apply to multi-state appellations. That is to say, winemakers in Washington, California, Nevada, and Idaho – for example – would be able to use The Rocks District on their labels as it is a single state appellation and they are in an adjacent state. However, wineries in California, Nevada, and Idaho would not be able to use Walla Walla Valley as it is a multi-state appellation. The TTB states that the rationale for this was to keep the changes within the scope of the comments made on The Rocks District appellation proposal. Additionally, multi-state appellations already have flexibility in where wines are produced.

The effects of this rule change would be far reaching, particularly for Northwest producers. At present, numerous wineries in Washington, Oregon, and Idaho source grapes from adjacent states to take advantage of where certain grapes grow best. However, due to existing laws, they are currently often forced to use more generic appellation labels. For example, Oregon-based Sineann labels its Block One Cabernet Sauvignon from Champoux Vineyard (pictured above) with the more generic ‘Columbia Valley’ as it cannot use the more specific ‘Horse Heaven Hills’. If the rule change were accepted, this would no longer be the case.

The comment period for the proposed rule ends April 10th.