Wineries: Napa Valley Wrestling With Growth : In 1973, the County Had 30--Today the Number Is 250

Residents of the Napa Valley, one of America’s most famous wine-growing regions, have been arguing for more than two years over an issue that has become as hot as any “Falcon Crest” plot.

What is a winery?

A winery used to be a place where grapes came in the back door and, some time later, wine went out the front. But as the number of wineries grew, some operations merely sold purchased bulk wine and made a good portion of their profits on the sale of wine glasses, bread and cheese. Others crushed no locally grown grapes but trucked them in from other regions, angering local growers.

At the same time, the valley with the wall-to-wall vines has had an explosion of new wineries. Now there are about 180 wineries in the valley and more than 250 in Napa County with about 20 more approved by the Napa County Conservation, Development and Planning Commission. Just 15 years ago, the county had no more than 30.

And the valley has become a tourist haven. Those seeking free tastes of wine as well as contact with the bucolic life-style mingle with trucks to create noise, dirt and congestion.

In 1987, nearly 3 million tourists visited the Napa Valley, according to the Napa Valley Chamber of Commerce, and one resident said the other day, “We won’t drive into town on weekends because of the traffic. You just don’t get out on Highway 29. You can’t make a left turn.”

All this has led to a push by residents for a definition of what is a winery. The aim is to keep out those enterprises that don’t fit the definition.

Most agree a winery is more than a retail shop that sells purchased wine along with jewelry and T-shirts. Some hope to outlaw concerts at wineries; others would stop the sale of food and ban picnic tables. One proposal would ban the sale of art at a winery.

County officials began pondering the question of what a winery is more than two years ago, but each definition gored someone’s ox. One original definition of a winery is a place where grapes are crushed or fermented. The most recent definition is where grapes are crushed and fermented. But Napa County Planning Director James Hickey said that alone may not solve the problem if a “winery” crushes and ferments a small amount of grapes but whose main business is the sale of aprons.

“At some point, the marketing and promotional aspects have crept in, and the county has had to step in and say, ‘Whoa,’ ” said Hickey. “Do we have an exclusive agricultural production area here? We need a new definition of a winery.”

That prompted the Napa Valley Grape Growers, Napa Valley Vintners Assn. and other groups to propose solutions. The Vintners has proposed the establishment of a winery production zone that would include all existing wineries. New wineries would have to apply to get into the zone. That issue is to go before Napa County Conservation, Development and Planning Commission in mid-June.

But opposition to all other proposals has been virulent.

One problem is that existing wineries want to be able to continue some practices that they propose to be illegal for newcomers. And thus has the word grandfather become popular with so many locals.

“A winery that doesn’t crush grapes, just trucks them in from another area, well, that’s a potential abuse” of the Napa Valley’s agricultural preserve, said Reverdy Johnson, president of the vintners’ association.

But he acknowledged that a number of valley wineries do precisely that, “so we’re seeking . . . to grandfather in those who may be in that position, but to preclude it in the future by requiring that there be fermentation on premises--that a winery is not a winery unless it’s involved in fermentation.”

“I think there has to be some grandfathering,” said Michael Mondavi, president of the Robert Mondavi Winery, adding that some wineries would be put out of business by some of the proposals to limit development.

Bob Dwyer, executive director of the Vintners, said, “We have been trying to ascertain how do we sensitively handle those who have been here for a long period of time.” He spoke of the “new guys who are now coming in for the buck,” and the need to assure that they conform to the law.

Late last year, grape growers came up with what they said was a solution. They proposed that all wine produced in the Napa Valley contain 75% Napa Valley grapes. That suggestion was met with irritation by many wineries, notably those which own Napa Valley vineyard land as well as vineyards elsewhere in the state.

To ‘Preserve and Protect Napa Valley’

Michael Mondavi called it unenforceable and said it was an awful idea.

But grower Andy Beckstoffer, who manages some 3,000 acres of vineyard land and who was one of those who propounded the proposal, said the county’s general plan calls for residents to “preserve and protect Napa Valley agriculture,” and that the 75% plan would do that.

“I have a hard time convincing myself that a winery here that produces wine from Sonoma grapes, or a producer who uses Des Moines wheat, is preserving and protecting Napa Valley agriculture,” said Beckstoffer, a former county planning commissioner who earned an MBA at Dartmouth. “The Napa Valley will put up with a lot of noise and dust if you crush Napa Valley grapes, but not if you crush Sonoma grapes.”

But Johnson of the vintners association said of the growers’ plan: “If you are going to tinker with the supply-demand equation, you can’t tinker with only one side of it. There also has to be a requirement that the fruit that is grown in the Napa Valley stays in Napa Valley.” Thus, he said, he expects that each grower to sell no more than 25% of a year’s crop outside the county.

The what-is-a-winery question began to be raised about a decade ago when Daryl Sattui opened V. Sattui Winery midway between St. Helena and Oakville ostensibly to sell cheese and bread and offer tourists picnic tables at which they could eat lunch . . . with a bottle of Sattui wine. That wine originally was purchased from neighbors.

There was no major outcry against Sattui and eventually profits from his sales room helped Sattui build a state-of-the-art winery. His current wines, crushed and fermented on premises, have been well received critically.

Subsequently, others began to sell more wine goods out of tasting rooms than wine, and the one that generated the most discussion was Tony Peju, who owns a 30-acre vineyard in Rutherford.

Since 1985, Peju has tried to open a winery and tasting room. Over the years, his plans were questioned by the Napa County Conservation, Development and Planning Commission, which said he violated use permit regulations and did not follow correct permit procedures.

Two recent challenges to developments are neighbors’ opposition to the new Clos Pegase Winery’s plan to expand its production and to Whitbread of California’s plans to build a winery on Soda Canyon Road. Neither issue is settled, and neighbors’ groups are fighting the developments with gusto.

All this opposition to new wineries makes it clear that starting a winery in the Napa Valley in the future will be most difficult.

“It’s harder to start a winery today than it was a year ago, and it’ll be next to impossible a year from today,” said Michael Moone, president of Nestle-owned Wine World, which owns Beringer and Chateau Souverain.

“It’s better to be here now than to be someone who’s looking to be here a year from now,” said planning commissioner Will Nord, an executive with Domaine Chandon winery in Yountville.

All this has created a rush to beat possible zoning law changes.

Dwyer estimated that there are more than 40 more wineries in the Napa Valley today than there were a year ago. Hickey added, “We’ve had 27 applications for new wineries since (late March when) the vintners suggested there should be a limitation on the number of wineries.” That would give Napa County close to 300 wineries, he said.

A Rush for Permits

Mondavi said he wasn’t surprised at the rush to get winery permits. “The last time there was confusion over an issue like this, about 1982, there was a freeze on new wineries.”

Dwyer added that one method of controlling tourist traffic is to have a number of wineries consolidate their tasting rooms in small shopping centers, as a number of wineries are doing at the Vintners’ Village north of St. Helena. Still other wineries are charging a small fee for tasting, hoping the fee will reduce the traffic.

Mondavi said existing laws are sufficient to deal with the problems posed by newcomers.

“This is not a simple issue,” said Hickey. “If it were, it would have been solved 2 years ago. Or we could have swept it under the carpet and let everyone go and do, but that would hurt the environment.”

The planning commission has scheduled a hearing July 20 at which it will formally receive a proposal on what is a winery from growers and vintners for review.

And perhaps once and for all the county will determine just what a winery is.