Private road issue delays action on boutique wineries - By-right on public roads likely

The county’s Planning Commission heard a proposed zoning ordinance amendment which would allow boutique wineries to operate without use permits, although concerns over wineries accessed by private roads prevented a recommendation at the September 7 meeting.

The motion approved unanimously returned the matter to the San Diego County Board of Supervisors without a specific ordinance but recommended that wineries accessible by public roads should be allowed by right while noting that time will be required for a solution to wineries accessible by private roads.

“There’s only one thing in my mind that stands in the way, and that’s this private road issue,” said Planning Commissioner Adam Day. “We’ve got to find a solution before you can get my vote.”

Possible solutions to protect occupants and property owners sharing private road access with a winery include administrative permits for such wineries, co-op tasting rooms, and road maintenance agreements. “I think there’s more to be done on this than meets the eye,” said Planning Commissioner Bryan Woods.

Woods also noted a difference between private roads serving a few properties and private roads serving numerous homes and added that the width of the private road might also be a factor.

While co-op tasting rooms in which wineries off private roads would send wine to facilities accessible by public roads is permissible under wineries’ state licenses, the county would also need to reconcile that option with the proposal’s current retail sales provision requiring at least 35 percent of the wines sold to be from the winery operating the tasting room.

On February 28 the San Diego County Board of Supervisors directed county staff to return to the supervisors within 120 days with an ordinance which would exempt wineries producing no more than 12,000 gallons per year and on agriculturally-zoned land from discretionary permits.

The existing zoning ordinance defines two types of wineries. A Wholesale Limited Winery allows production of up to 7,500 gallons annually and is allowed by right in agricultural zones, but the zoning ordinance does not allow retail activities, tasting rooms, or special events. A Winery is allowed by right in industrial zones but is required to have a major use permit in agricultural zones and in certain residential and special purpose zones. Tasting rooms, special events, and retail sales can be allowed under the conditions of a major use permit.

The Board of Supervisors’ February 28 recommendation created four new categories of wineries in addition to the Wholesale Limited Winery category. Boutique wineries produce no more than 12,000 gallons per year, small wineries produce up to 55,999 gallons annually, medium wineries produce under 100,000 gallons, and large wineries produce at least 100,000 gallons.

The ordinance under consideration only covers boutique wineries. The only winery in San Diego County currently producing more than 12,000 gallons annually is Orfila Vineyards, which is located within the San Diego city limits in the San Pasqual Valley.

Sales, tasting, and special events were proposed to be allowed by right at boutique wineries, with an administrative permit for small wineries, with a minor use permit for medium wineries, and with a major use permit for large wineries. One tasting room of up to 30 percent of the production facility’s area or 2,000 square feet (whichever is greater) would be allowed for all wineries, and up to 30 percent of the tasting room area would be allowed for non-wine retail sales.

“Any building would be subject to the same standards as any agricultural zone,” said county Department of Planning and Land Use project manager Lory Nagem. “They are subject to building size limits like any other agricultural property.”

Boutique wineries would not be allowed to host special events and could hold up to four marketing events per year. The marketing events would be limited to between 10 a.m. and sunset. Retail sales would be allowed seven days a week between 10 a.m. and sunset; 75 percent of the wines sold must be from San Diego County grapes and 35 percent of the wine must be from the winery operating the tasting room, although there is an exemption for new wineries and the county’s Department of Agriculture, Weights and Measures could suspend the requirement.

Pre-packaged food could be sold and consumed, and food service would be allowed if catered or from a facility approved by the county’s Department of Environmental Health. No bus or caravan tours would be allowed for boutique wineries, and outdoor eating areas would be limited to five tables and no more than ten people. No amplified sound would be allowed, and chip seal or alternative material would be required for access and parking areas (a condition which would address concerns about access by dirt roads).

Harvesting and wholesale sales (with state approval) are already permitted uses in agricultural areas. “It doesn’t change the scale of the enterprise,” said Planning Commissioner Michael Beck.

“In some areas the land use is a good and appropriate one. In other areas it would be a serious mistake,” said Gil Jemmott, the chair of the Twin Oaks Community Sponsor Group.

Craig Justice of Hidden Meadows noted that retail sales are more profitable than grape sales to other wineries. “What we could get for grapes wouldn’t cover the cost of growing them,” he said.

“A San Diego County use permit is an onerous, expensive, and often terminal process,” said Carolyn Harris of Chupa Rosa Vineyards in Ramona, which has two acres of zinfindel and brumello.

“We’re already allowed to grow grapes. We’re already allowed to make wine,” Harris said. “We’re only looking for that marginal incremental liberty here.”

Harris noted that the smallest wineries have few wholesale channels and that middlemen take a significant portion of the profit. “Small wineries depend on direct sales for two-thirds to three-fourths of their total sales,” she said.

Harris was amenable to the co-op provision for wineries off private roads. “I want to pair with some of these quality wineries in my area,” she said.

Opponents fear intoxicated drivers returning from – or between - tasting rooms on private roads and hazardous public roads such as State Route 67 in Ramona. Harris’ husband cited California Highway Patrol information from Napa and Sonoma Counties that the number of wineries doesn’t make a difference in alcohol-related incidents. “In general you will find this is not where the problem is,” Andy Harris said.

Andy Harris noted that other agricultural businesses off private roads serve the public and that the exemption is limited to agriculturally zoned areas. “Our people in particular move to these regions in order to practice agriculture,” he said.

Andy Harris also noted that wine growing lacks the water consumption burden of many fruit crops. “Wineries and grape growing in general are extremely low water usage drought crops,” he said.

“The (proposed) ordinance is good for the farmer, good for the county, good for agricultural growth,” said Michael Kopp of Kohill Winery, who grows various varietals on 2.3 acres in Ramona.

“A boutique winery is not a bar. It’s a showcase for the farm’s product,” said Beth Edwards of Edwards Vineyard and Cellars, which cultivates approximately two acres in Ramona.

“We support access to markets,” said Eric Larson, the executive director of the San Diego County Farm Bureau. “They’ve got to be allowed to sell retail.”

Members of the Farm Bureau are on both sides of the private road issue, so the Farm Bureau has taken no position on private road restrictions. “We don’t want to see the private road growers just excluded from the process,” Larson said.

Larson noted that San Diego County’s agriculture profile has changed over the decades. “We embrace change where change is warranted in agriculture,” he said. “We must encourage the next crops whatever it may be.”

Don Kohorst of Pyramid Vineyards has 8 1/2 acres in Ramona. He noted that the grower’s profit for grapes sold to a winery equated to about $1.25 a bottle while the profit for selling wine was $5 to $7 for wholesale transactions and $12 to $18 for retail sales. “You can retail your wine and make it very possible to support a family on this grape production,” he said.

“I need to have a market for my grapes and I need to have a niche market that appreciates this is locally-grown produce,” said Bill Schweitzer, whose six-acre Paccielo Vineyard sells sangiovese and cabernet sauvignon grapes to local wineries but does not produce wine itself. “It is possible to make great wine in San Diego County.”

Schweitzer noted that the requirement that 75 percent of the grapes be grown within the county will benefit local agriculture. “This supports the local farm community beyond just those who want to become wineries and tasting rooms,” he said.

“I feel that wineries will definitely help preserve the rural agricultural character,” said Sam Dawson, who has a winery in Dulzura.

Dawson currently sells wine wholesale for $8 to $10 per bottle. “You do a lot of struggling,” he said. “It would be nice for the growers and the winemakers to participate in some of this profitability.”

Tammy Rimes and her husband own Hacienda de las Rosas Winery and have just over one acre of cabernet sauvignon and sauvignon blanc in production. “I am in an agricultural area, not a residential area,” she said.

Nearby uses include dog kennels, Christmas tree farms, and equestrian facilities which involve trips by the general public. “This is just not fair. You shouldn’t have one agricultural business treated differently than another,” Rimes said.

Schwaesdall Winery in Ramona is the county’s only boutique winery which has a major use permit for a tasting room, although John Schwaesdall completed that process 11 years ago at the cost of $7,000. The average major use permit now costs $218,000 with some applicants paying below the average and others paying above the average.

“I think the ordinance is good for the wine business. These people will not survive if this does not go through,” Schwaesdall said.

Ramona resident Carol Angus told the Planning Commission that the proposed ordinance was not compatible with the county’s general plan or with community character. “The safety problems created are not justified by the benefits of the wineries amendment,” she said.

Angus noted that by-right sales would remove limits on retail and commercial operations. “The community character is likely to change,” she said. “The issues are inconsistent with community character.”

Attorney Scott Williams indicated that encouraging the development of multiple wineries would require a programmatic environmental impact report for the aggregate impacts. “A comprehensive and thorough environmental review should be conducted now,” he said. “We believe that an environmental impact report needs to be proposed rather than a mitigated negative declaration.”

Ramona resident Don Kovacic also opposed the by-right proposal. “A major use permit is the only way to properly protect the community,” he said.

Vivian Osborn of Ramona felt that an administrative permit might be sufficient. “It would oversee the behavior and their use,” she said.

“People driving on private roads could be a very serious problem,” Osborn said. “You’re putting a lot of stress on the neighborhood.”

Both a major use permit and an administrative permit require public review and an environmental impact statement. While Carolyn Harris was supportive of the co-op proposal, she opposed an administrative permit requirement which would require small wineries to undergo the environmental review process. “That’s the end of the road for wine development in San Diego County,” she said.

“I am in favor of a permit process that wouldn’t be as restrictive as a major use,” said Teresa Hobbs of Ramona.

Hobbs expressed concern about the additional traffic on her private road which would be generated by the tasting rooms and retail sales. “We still all have to pay equally in the upkeep of that road,” she said.

Lee Pedlow lives on a private road in Ramona. “It’s not the number of trips. It’s the concentration of trips on the weekends,” he said.

“That’s me losing my land rights. That’s me losing my privacy,” Pedlow said. “That’s essentially seizure of my property.”

Pedlow also noted that property owners usually share equally in the cost and labor of maintaining a private road. He added that the owners of a private road may be liable if a visitor from the tasting room has an accident while driving that road. “I may not be able to get insurance on my own property,” he said.

“The condition of the road increases liability,” said Teri Merry of Ramona. “I am concerned about the shared liability that can happen.”

Tom Ramsthaler lives on a private road in Ramona which has two wineries and 26 houses. “Look at what it does to 90 percent of the neighborhood,” he said. “We need to come up with a compromise that keeps 80 percent of our neighborhood happy.”

Ramsthaler suggested making the use permit process less expensive. “We have to find a better way to do things,” he said.