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Proposed Rule

Proposed Establishment of the Swan Creek Viticultural Area (2005R-414P)

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Start Preamble

AGENCY:

Alcohol and Tobacco Tax and Trade Bureau, Treasury.

ACTION:

Notice of proposed rulemaking.

SUMMARY:

The Alcohol and Tobacco Tax and Trade Bureau proposes to establish the 96,000-acre Swan Creek viticultural area in Wilkes, Yadkin, and Iredell Counties, North Carolina. We designate viticultural areas to allow vintners to better describe the origin of their wines and to allow consumers to better identify wines they may purchase. We invite comments on this proposed addition to our regulations.

DATES:

We must receive written comments on or before November 13, 2006.

ADDRESSES:

You may send comments to any of the following addresses:

You may view copies of this notice, the petition, the appropriate maps, and any comments we receive about this proposal by appointment at the TTB Information Resource Center, 1310 G Street, NW., Washington, DC 20220. To make an appointment, call 202-927-2400. You may also access copies of the notice and comments online at http://www.ttb.gov/​wine/​wine_​rulemaking.shtml.

See the Public Participation section of this notice for specific instructions and requirements for submitting comments, and for information on how to request a public hearing.

Start Further Info

FOR FURTHER INFORMATION CONTACT:

N.A. Sutton, Regulations and Rulings Division, Alcohol and Tobacco Tax and Trade Bureau, 925 Lakeville Street, No. 158, Petaluma, CA 94952; telephone 415-271-1254.

End Further Info End Preamble Start Supplemental Information

SUPPLEMENTARY INFORMATION:

Background on Viticultural Areas

TTB Authority

Section 105(e) of the Federal Alcohol Administration Act (the FAA Act, 27 U.S.C. 201 et seq.) requires that alcohol beverage labels provide consumers with adequate information regarding product identity and prohibits the use of misleading information on those labels. The FAA Act also authorizes the Secretary of the Treasury to issue regulations to carry out its provisions. The Alcohol and Tobacco Tax and Trade Bureau (TTB) administers these regulations.

Part 4 of the TTB regulations (27 CFR part 4) allows the establishment of definitive viticultural areas and the use of their names as appellations of origin on wine labels and in wine advertisements. Part 9 of the TTB regulations (27 CFR part 9) contains the list of approved viticultural areas.

Definition

Section 4.25(e)(1)(i) of the TTB regulations (27 CFR 4.25(e)(1)(i)) defines a viticultural area for American wine as a delimited grape-growing region distinguishable by geographic features, the boundaries of which have been recognized and defined in part 9 of the regulations. These designations allow vintners and consumers to attribute a given quality, reputation, or other characteristic of a wine made from grapes grown in an area to its geographic origin. The establishment of viticultural areas allows vintners to describe more accurately the origin of their wines to consumers and helps consumers to identify wines they may purchase. Establishment of a viticultural area is neither an approval nor an endorsement by TTB of the wine produced in that area.

Requirements

Section 4.25(e)(2) of the TTB regulations outlines the procedure for proposing an American viticultural area and provides that any interested party may petition TTB to establish a grape-growing region as a viticultural area. Section 9.3(b) of the TTB regulations requires the petition to include—

  • Evidence that the proposed viticultural area is locally and/or nationally known by the name specified in the petition;
  • Historical or current evidence that supports setting the boundary of the proposed viticultural area as the petition specifies;
  • Evidence relating to the geographical features, such as climate, Start Printed Page 53613soils, elevation, and physical features, that distinguish the proposed viticultural area from surrounding areas;
  • A description of the specific boundary of the proposed viticultural area, based on features found on United States Geological Survey (USGS) maps; and
  • A copy of the appropriate USGS map(s) with the proposed viticultural area's boundary prominently marked.

Swan Creek Petition

Raffaldini Vineyards submitted a petition to establish the 96,000-acre “Swan Creek” viticultural area on behalf of the Vineyards of Swan Creek, a trade association representing a group of vineyards and wineries in northwest North Carolina. Within the boundary of the proposed viticulture area are 3 wineries and 75 acres of vineyards. The boundary of the proposed viticultural area incorporates portions of Wilkes, Yadkin, and Iredell Counties and includes a portion of the established Yadkin Valley viticultural area (27 CFR 9.174). We summarize below the evidence submitted in support of the petition.

Name and Boundary Evidence

The petitioner explains that the geographical name “Swan Creek” refers to a village in the approximate center of the proposed viticultural area, as well as two streams located near the village, East Swan Creek and West Swan Creek, which are depicted in the southwest portion of the 1:100,000-scale USGS Winston-Salem, North Carolina topographic map. The USGS map shows Swan Creek village in the Brushy Mountains, with the two creeks running north from the mountain elevations to the Yadkin River. Also, an undated State of North Carolina Department of Environment, Health, and Natural Resources document lists Swan Creek, West Swan Creek, and East Swan Creek as streams in the Yadkin-Pee Dee River Basin.

The DeLorme North Carolina Atlas and Gazetteer identifies the village as “Swancreek,” with East Swan Creek and West Swan Creek to its northwest. The petitioner explains that both names, “Swan Creek” and “Swancreek,” reference the proposed viticultural area region. However, the two-word spelling is the more common usage for businesses, roads, creeks, and historical documents, which led the petitioner to identify the proposed viticultural area as “Swan Creek.”

The local Wilkes Telephone Membership Corp. telephone book, which covers the region that includes the proposed viticultural area, lists an airport, church, and three businesses using “Swan Creek” in their names. A search of the North Carolina Department of the Secretary of State's Web site (http://www.secretary.state.nc.us/​Corporations/​ThePage.aspx) lists eight businesses currently operating with “Swan Creek” in their names.

As further evidence of the significance of the “Swan Creek” name within the proposed area, the September 7, 2004, minutes of a Yadkin County Commission meeting includes a reference to the Swan Creek area and improvements to Swan Creek Road. Additionally, a National Weather Service bulletin from January 13, 2005, warns of the possibility of a tornado in the Swan Creek area. The name is also repeatedly used in the “Vineyards of Swan Creek Wine Trail” Web site (http://www.swancreekvineyards.com).

The petitioner relies on geographical and man-made elements identifiable on the supplied USGS maps to define and draw the boundary for the proposed viticultural area. Climate data and historic evidence that documents the breadth of the “Swan Creek” name also legitimize the proposed boundary line, according to the petitioner.

From the regional history of the Yadkin Valley, the petitioner connects the “Swan Creek” name to stories of Revolutionary War soldiers traveling along the proposed Swan Creek viticultural area northern boundary line at the Yadkin River, en route to the pivotal battle at King's Mountain in South Carolina. Also, during the Civil War, Union Major General George Stoneman led troops eastward through Swan Creek to Virginia. Historic manuscripts also maintain that frontiersman Daniel Boone homesteaded in the Swan Creek region in the 1750's.

After the Civil War, the Swan Creek area turned to farming, which continues to characterize this rural region despite the urban development in other portions of the Yadkin Valley viticultural area. Today, agriculture in the Swan Creek region includes viticulture, with 75 acres within the proposed Swan Creek viticultural area currently dedicated to grape growing, according to the petition.

The geology of the Swan Creek region, along with its minor climatic variation, also creates distinguishing viticultural features upon which to base boundary distinctions. The entire proposed Swan Creek viticultural area lies within the Yadkin River Basin. The general uniformity in the Swan Creek region's soils is attributable to the natural weathering process of the Brushy Mountains and the Brevard Shear Zone, a major fault system that also defines the Blue Ridge Escarpment in the area. The homogeneous soil within the proposed viticultural area is unlike the varied soils and rock types found in other parts of the Yadkin Valley viticultural area.

The proposed Swan Creek viticultural area boundary overlaps the established Yadkin Valley viticultural area as shown in the table below.

Viticultural areasTotal acresOverlapping acresPercent overlapping
Yadkin Valley1,416,00057,6004
Swan Creek (Proposed)96,00057,60060

The northern 60 percent of the proposed Swan Creek viticultural area sits within the Yadkin Valley viticultural area, with the remaining 40 percent south of the Yadkin Valley viticultural area boundary line, according to the petition maps.

The discussion below includes further substantive evidence on the differences between the Yadkin Valley viticultural area and the proposed Swan Creek viticultural area, which, according to the petitioner, justifies the proposed boundary line.

Distinguishing Features

Situated in the moderate elevations of the Brushy Mountains, and bordering the Yadkin River, the proposed Swan Creek viticultural area's geographical location is responsible for the area's temperate climate and homogenous soil as compared to surrounding areas, according to the petitioner.

Topography

The Brushy Mountains run through the center of the Swan Creek region, with elevations in the proposed Swan Creek viticultural area varying between 1,000 feet and 2,000 feet, according to the USGS maps submitted with the petition. The Brushy Mountains, within Start Printed Page 53614the proposed viticultural area, have elevations lower than the Blue Ridge Mountains to the west but higher than the other surrounding areas, according to the USGS maps. The Blue Ridge Mountain region to the immediate west of the proposed boundary line rises to elevations of from 3,000 feet to 5,000 feet. To the east and south of the proposed viticultural area, the elevation drops to between 500 feet and 1,000 feet.

Climate

Both the Yadkin River running adjacent to the proposed Swan Creek viticultural area's northern boundary line and the Brushy Mountains that lie within the proposed viticultural area boundary serve as climatically moderating influences.

The Swan Creek region has an average annual high temperature of 68.9 °F and an average annual low temperature of 42.8 °F. The table below shows the contrasting temperatures in the regions beyond the proposed boundary line, as collected by the Southeast Regional Climate Center (SERCC) of the National Climatic Data Center.

RegionAverage annual maximum temperature in degrees FahrenheitAverage annual minimum temperature in degrees Fahrenheit
Swan Creek68.942.8
West and northwest59.840.4
South and east70.646.6
Yadkin Valley69.544.8

The SERCC data shows that the Swan Creek area is generally warmer than the regions to the west and northwest, cooler than the regions to the south and east, and slightly cooler than the Yadkin Valley as a whole. Also, average January temperatures of 20 °F to 25 °F make the Swan Creek region less prone to Pierce's Disease, which adversely affects vineyards, than the majority of the Yadkin Valley viticultural area.

The proposed Swan Creek viticultural area averages 3,576 degree days of heat accumulation annually, which puts it in climatic region IV, according to temperature data collected by the SERCC. (As a measure of heat accumulation, each degree that a day's mean temperature is above 50 °47 F, which is the minimum temperature required for grapevine growth, is counted as one degree day; see “General Viticulture,” Albert J. Winkler, University of California Press, 1975.) The surrounding areas, based on Amerine and Winkler heat summation definitions, include climatic regions IV and V to the east, region V to the south, and region I to the west-northwest.

The frost-free season of the proposed Swan Creek viticultural area extends on average from April 19 to October 17 annually, according to the “Average Last Spring Frost Dates for Selected North Carolina Locations,” horticulture information leaflets (published December 1996 and revised December 1998), by Katharine Perry, North Carolina State University. According to the petition, this frost-free season is nearly identical to Surry County, which is part of the Yadkin Valley viticultural area located immediately northeast of the proposed Swan Creek viticultural area. However, southeast of the proposed viticultural area, but also within the Yadkin Valley viticultural area, the Davidson County frost-free season averages from March 31 to October 31, resulting in a month less frost than in the proposed Swan Creek viticultural area. The frost-free season in counties outside the Yadkin Valley viticultural area and the proposed Swan Creek viticultural area varies, extending three weeks longer to the east, but lasting four to six weeks less in regions to the west and northwest.

In addition, the growing season of the proposed Swan Creek viticultural area averages 170 to 190 days annually, according to Perry's “Average Growing Seasons for Selected North Carolina Locations,” horticulture information leaflets (published December 1996 and revised December 1998). Again, this growing season is almost identical to the county immediately northeast, located within the Yadkin Valley viticultural area. However, according to Perry's data, Davidson County averages a 214-day growing season annually, or between 24 and 44 more growing days than the proposed Swan Creek viticultural area. Similarly, the petition shows that Guilford County to the east has an annual growing season of between 199 and 210 days. Counties to the west and northwest of the Swan Creek region have a significantly shorter growing season, lasting an average of 139 to 162 days.

Precipitation

The petitioner attributes the moderate rainfall within the proposed viticultural area to the protective influence of the Brushy Mountains. Rainfall within the proposed Swan Creek viticultural area averages 48.6 inches annually, based on SERCC data, with the local grape growers surveyed by the petitioner recording less rainfall at their own weather stations. The areas to the west and northwest of the proposed viticultural area average 57 inches each year, while regions to the south and east average 44.4 inches of rain annually.

Furthermore, snowfall within the proposed Swan Creek viticultural area averages 6.3 inches annually, based on SERCC records, which is far less than the data recorded at weather stations in surrounding areas.

Geology

The geology of the proposed Swan Creek viticultural area, with documentation and evidence provided for the petition by Matthew Mayberry of the Mayberry Land Company, Elkin, North Carolina, is shaped by plate tectonics and a spectrum of uplift and erosion for the entire Appalachian Mountains building cycle. The Swan Creek region is part of the larger Appalachian Mountain Range area that has gone through at least three cycles of uplift and erosion, with each cycle lasting around 300 million years. Also, the weathering and erosion cycles created the resulting Piedmont and Blue Ridge surfaces found in the proposed viticultural area today.

Mr. Mayberry explains that the four predominant rock types in the proposed viticultural area are Henderson Gneiss, Granite, Biotite Gneiss and Biotite Amphibolite Gneiss, and Sillimanite Mica Schist. These types make up more than 90 percent of the Swan Creek area, with the latter three composing about 80 percent of the southern part of the area. Along the proposed north boundary line at the Yadkin River the predominant rock types include Ashe Formation, Utramafics, and Granitic Rocks of the Crossnore Group. Start Printed Page 53615

Soil

The soil information in the Swan Creek viticultural area petition is compiled from the published soil surveys of Wilkes, Yadkin, and Iredell Counties in North Carolina. Roy Mathis, Soil Specialist for Correlations, Natural Resources Conservation Service, United States Department of Agriculture, provided the soil information included in the petition.

The areas surrounding the proposed Swan Creek viticultural area have soils with differing characteristics, Mr. Mathis explains. The areas to the south and east have high shrink-swell clayey soils, which are less desirable for agriculture. To the west and north are the mountainous rocks and soils of the encroaching Blue Ridge Mountains. Also, the Yadkin Valley viticultural area, which surrounds the proposed Swan Creek viticultural area to the west, north, and east, has a greater variety of soil types and temperature regimes.

The proposed Swan Creek viticultural area mesic temperature regime has soil temperatures of 47 °F to 59 °F at the depth of 20 inches, according to Mr. Mathis. In comparison, the Yadkin Valley viticultural area is in both the mesic and thermic temperature regimes, with soil temperatures much warmer at 59 °F to 72 °F at the same soil depth.

Mr. Mathis explains that the soils in the proposed Swan Creek viticultural area are primarily saprolite, a soft, clay-rich soil derived from weathered felsic (acidic) metamorphic rocks of the Inner Piedmont Belt such as granites, schists, and gneisses. The region includes a small area of Sauratown Belt with the rocks being primarily metagraywacke. In contrast, the surrounding west and north areas include residuum (saprolite) weathered from felsic metamorphic rocks such as gneisses, schists, and phyllites of the Blue Ridge Geologic Belt and Smith River Allochothon. The saprolite in the surrounding area to the east is composed of weathered igneous intrusive rocks like granites, gabbros, and diorites, as well as some gneisses and schists of the Charlotte Belt.

Evard and Cowee soils, which have moderate permeability and are well-drained with a loamy surface and sub-soil layer, predominate in the Brushy Mountains. Yet the dominant ridge top soils of the proposed Swan Creek viticultural area include the Fairview and Clifford series. These soils have sandy clay loam or clay loam surface layers with red clayey sub-soils, and are well-drained with moderate permeability.

Rhodhiss series is the dominant soil on the steep side slopes within the proposed viticultural area boundary. This well-drained soil has a loamy surface and moderate permeability at the sub-soil level. Mr. Mathis notes that Fairview, Clifford, and Rhodhiss soils all have bedrock deeper than 60 inches.

The Yadkin River, at the northern boundary of the proposed Swan Creek viticultural area, has alluvial soil diversity with textures and drainage. In general, most of the proposed Swan Creek viticultural area soils are acidic and low in natural fertility.

Boundary Description

See the narrative boundary description of the petitioned-for viticultural area in the proposed regulatory text published at the end of this notice.

Maps

The petitioner provided the required maps, and we list them below in the proposed regulatory text.

Impact on Current Wine Labels

Part 4 of the TTB regulations prohibits any label reference on a wine that indicates or implies an origin other than the wine's true place of origin. If we establish this proposed viticultural area, its name, “Swan Creek,” will be recognized under 27 CFR 4.39(i)(3) as a name of viticultural significance. The text of the new regulation would clarify this point. Consequently, wine bottlers using “Swan Creek” in a brand name, including a trademark, or in another label reference as to the origin of the wine, will have to ensure that the product is eligible to use the viticultural area's name as an appellation of origin. On the other hand, we do not believe that any single part of the proposed viticultural area name standing alone would have viticultural significance if the new area is established. Accordingly, the proposed part 9 regulatory text set forth in this document specifies only the full “Swan Creek” name as a term of viticultural significance for purposes of part 4 of the TTB regulations.

For a wine to be eligible to use as an appellation of origin a viticultural area name or other term specified as being viticulturally significant in part 9 of the TTB regulations, at least 85 percent of the wine must be derived from grapes grown within the area represented by that name or other term, and the wine must meet the other conditions listed in 27 CFR 4.25(e)(3). If the wine is not eligible to use the viticultural area name or other term as an appellation of origin and that name or term appears in the brand name, then the label is not in compliance and the bottler must change the brand name and obtain approval of a new label. Similarly, if the viticultural area name or other term appears in another reference on the label in a misleading manner, the bottler would have to obtain approval of a new label. Accordingly, if a new label or a previously approved label uses the name “Swan Creek” for a wine that does not meet the 85 percent standard, the new label will not be approved, and the previously approved label will be subject to revocation, upon the effective date of the approval of the Swan Creek viticultural area.

Different rules apply if a wine has a brand name containing a viticultural area name or other viticulturally significant term that was used as a brand name on a label approved before July 7, 1986. See 27 CFR 4.39(i)(2) for details.

Public Participation

Comments Invited

We invite comments from interested members of the public on whether we should establish the proposed viticultural area. We are also interested in receiving comments on the sufficiency and accuracy of the name, boundary, climate, and other required information submitted in support of the petition. Please provide any available specific information in support of your comments.

Because of the potential impact of the establishment of the proposed Swan Creek viticultural area on brand labels that include the words “Swan Creek” as discussed above under Impact on Current Wine Labels, we are particularly interested in comments regarding whether there will be a conflict between the proposed area name and currently used brand names. If a commenter believes that a conflict will arise, the comment should describe the nature of that conflict, including any negative economic impact that approval of the proposed viticultural area will have on an existing viticultural enterprise. We are also interested in receiving suggestions for ways to avoid any conflicts, for example by adopting a modified or different name for the viticultural area.

Although TTB believes that only the full “Swan Creek” name should be considered to have viticultural significance upon establishment of the proposed new viticultural area, we also invite comments from those who believe that “Swan” standing alone would have viticultural significance upon establishment of the area. Comments in this regard should include documentation or other information Start Printed Page 53616supporting the conclusion that use of the word “Swan” on a wine label could cause consumers and vintners to attribute to the wine in question the quality, reputation, or other characteristic of wine made from grapes grown in the proposed Swan Creek viticultural area.

Submitting Comments

Please submit your comments by the closing date shown above in this notice. Your comments must include this notice number and your name and mailing address. Your comments must be legible and written in language acceptable for public disclosure. We do not acknowledge receipt of comments, and we consider all comments as originals. You may submit comments in one of five ways:

  • Mail: You may send written comments to TTB at the address listed in the ADDRESSES section.
  • Facsimile: You may submit comments by facsimile transmission to 202-927-8525. Faxed comments must—

(1) Be on 8.5- by 11-inch paper;

(2) Contain a legible, written signature; and

(3) Be no more than five pages long. This limitation assures electronic access to our equipment. We will not accept faxed comments that exceed five pages.

  • E-mail: You may e-mail comments to nprm@ttb.gov. Comments transmitted by electronic mail must—

(1) Contain your e-mail address;

(2) Reference this notice number on the subject line; and

(3) Be legible when printed on 8.5- by 11-inch paper.

  • Online form: We provide a comment form with the online copy of this notice on our Web site at http://www.ttb.gov/​wine/​wine_​rulemaking.shtml. Select the “Send comments via e-mail” link under this notice number.
  • Federal e-rulemaking portal: To submit comments to us via the Federal e-rulemaking portal, visit http://www.regulations.gov and follow the instructions for submitting comments.

You may also write to the Administrator before the comment closing date to ask for a public hearing. The Administrator reserves the right to determine whether to hold a public hearing.

Confidentiality

All submitted material is part of the public record and subject to disclosure. Do not enclose any material in your comments that you consider confidential or inappropriate for public disclosure.

Public Disclosure

You may view copies of this notice, the petition, the appropriate maps, and any comments we receive by appointment at the TTB Information Resource Center at 1310 G Street, NW., Washington, DC 20220. You may also obtain copies at 20 cents per 8.5- x 11-inch page. Contact our information specialist at the above address or by telephone at 202-927-2400 to schedule an appointment or to request copies of comments.

We will post this notice and any comments we receive on this proposal on the TTB Web site. All name and address information submitted with the comments will be posted, including e-mail addresses. We may omit voluminous attachments or material that we consider unsuitable for posting. In all cases, the full comment will be available in the TTB Information Resource Center. To access the online copies of this notice and the submitted comments, visit http://www.ttb.gov/​wine/​wine_​rulemaking.shtml. Select the “View Comments” link under this notice number to view the posted comments.

Regulatory Flexibility Act

We certify that this proposed regulation, if adopted, would not have a significant economic impact on a substantial number of small entities. The proposed regulation imposes no new reporting, recordkeeping, or other administrative requirement. Any benefit derived from the use of a viticultural area name would be the result of a proprietor's efforts and consumer acceptance of wines from that area. Therefore, no regulatory flexibility analysis is required.

Executive Order 12866

This proposed rule is not a significant regulatory action as defined by Executive Order 12866, 58 FR 51735. Therefore, it requires no regulatory assessment.

Drafting Information

N.A. Sutton of the Regulations and Rulings Division drafted this notice.

Start List of Subjects

List of Subjects in 27 CFR Part 9

End List of Subjects

Proposed Regulatory Amendment

For the reasons discussed in the preamble, we propose to amend 27 CFR, chapter 1, part 9, as follows:

Start Part

PART 9—AMERICAN VITICULTURAL AREAS

1. The authority citation for part 9 continues to read as follows:

Start Authority

Authority: 27 U.S.C. 205.

End Authority

Subpart C—Approved American Viticultural Areas

2. Subpart C is amended by adding § 9.___ to read as follows:

Swan Creek.

(a) Name. The name of the viticultural area described in this section is “Swan Creek”. For purposes of part 4 of this chapter, “Swan Creek” is a term of viticultural significance.

(b) Approved maps. The appropriate maps for determining the boundary of the Swan Creek viticultural area are three United States Geological Survey, 1:100,000 scale, topographic maps. They are titled:

(1) Winston-Salem, North Carolina, 1984, photoinspected 1982;

(2) Boone, North Carolina-Tennessee, 1985; and

(3) Salisbury, North Carolina, 1985, photoinspected 1983.

(c) Boundary. The Swan Creek viticultural area is located in Wilkes, Yadkin, and Iredell Counties, North Carolina. The boundary of the Swan Creek viticultural area is described below:

(1) The beginning point is on the Winston-Salem, North Carolina map at the intersection of the Yadkin River and U.S. Highway 21, along the Surry-Yadkin county line, between Elkin and Jonesville;

(2) From the beginning point, proceed 24.6 miles generally south on U.S. Highway 21, crossing onto the Salisbury, North Carolina map, to the intersection of U.S. Highway 21 with Rocky Creek at Turnersburg;

(3) Proceed 12.3 miles generally north and west along Rocky Creek, returning to the Winston-Salem map, to the intersection of Rocky Creek with State Highway 115 at New Hope in the southwest corner of the map;

(4) Proceed 15.5 miles generally northwest along State Highway 115, crossing onto the Boone, North Carolina-Tennessee map, to the intersection of State Highway 115 and the Yadkin River, at North Wilkesboro; and

(5) Proceed 16.7 miles generally east-northeast along the Yadkin River, crossing onto the Winston-Salem map, to the beginning point.

Start Signature

Signed: August 1, 2006.

John J. Manfreda,

Administrator.

End Signature End Part End Supplemental Information

[FR Doc. E6-14918 Filed 9-11-06; 8:45 am]

BILLING CODE 4810-31-P