The 2016 grape harvest has been off to a slow start here in Napa County for several weeks now. For all wineries that hold a use permit issued through the Napa County Planning office this means the beginning stage of tracking numbers that are directly related to two areas of their permit. Those two areas are the production gallon amount and the 75% grape sourcing rule. The production gallon amount applies to all holders of a county use permit. The 75% grape sourcing rule applies to wineries that obtained a use permit after January of 1990 or to pre 1990 wineries that expanded their approved production gallons after January of 1990.
Currently county wineries are subject to an annual random audit that the planning office staff handle. So while they don’t currently have to submit any reports verifying compliance related to their permit’s production gallons, they also don’t know when their name may come out of the county’s hat each year for these random audits.
What is coming as a result of the APAC ‘s recommendations earlier this year is mandatory annual reporting. The date that this mandatory reporting will go into effect has not been confirmed as of yet, but it is coming.
I’ve had some clarification questions come from clients around both how the county determines “production” as well what they base their 75% grape sourcing counts on.
For the first topic, “production” the county staff look at a winery’s TTB 5120.17 (or 702) reports. I’ve previously written other blogs which break down specifically what numbers the county staff look at from those TTB reports to determine if a winery is in compliance with its production gallons. They look specifically at numbers from a few lines of the TTB reports, and they also compare three years worth of them and take an average to determine compliance.
For the second topic, the 75% grape sourcing rule the question I’ll often be asked is “do grapes that are crushed for us at another winery site and then sent to our site as either must or juice count?” No I tell them those types of deliveries will not count towards their site’s 75% count. What does count toward it for a county winery site with this use permit requirement?
- Grapes that are delivered and crushed/processed at their facility
- This includes grapes that they weigh themselves at their winery site as well as grapes that arrive at their site for processing but are delivered with a completed weigh tag. (weighmaster certificate)
- It does NOT include a delivery of juice that arrives at their site with a bill of lading (BOL) which lists the variety, appellation, vineyard, etc information as well as listing “Juice” and the gallon amount. Winery staff can simply ask themselves, “did the grapes come directly into our site as grapes?” If the answer is yes, then they count towards their 75% grape source requirement.
By the way- if you aren’t sure what your winery’s current approved production gallons are or whether your site is subject to the 75% grape source requirement you can now look up both those details on the Napa County Planning office’s website. You’ll find “Winery Database” under “Useful Information and Links”