Wine country faces inflection point

Livermore Valley wine country stands at a crossroads.

Thirty years ago Alameda County and the city of Livermore adopted the innovative South Livermore Valley Area Plan. In exchange for development rights on land near vineyards, it required planting five acres of irrigated agriculture (mostly grapevines) for each acre developed.

Elected officials, planners and vineyard advocates set a goal of 5,000 acres of irrigated agriculture surrounding primarily Livermore, although Ruby Hill and land along Vineyard Avenue in Pleasanton were also part of the plan. In its 1990 report, the Alameda County agricultural commissioner reported 1,628 acres of vines.

That was far less than the historical number dating from the 1880s when Wente Vineyards and Concannon Vineyards were established. Other wineries such as Cresta Blanca and Ruby Hill also were among the seven wineries with national distribution. Cresta Blanca put the Livermore Valley on the international wine map when it won an 1884 competition in Paris.

The landscape in Livermore started to change away from agriculture in the 1950s when both Lawrence Livermore and Sandia national labs established their campuses on East Avenue. Livermore grew from about 4,000 to 16,000 people that decade and has grown ever since.

Houses sprouted around Livermore where vineyards and dairies once operated.

By the late 1980s, the number of local wineries had fallen to six and the Wente family had to pull together a consortium of investors to save the Concannon brand when its corporate owner decided to sell it in 1992. The Concannon family sold in the 1980s to pay estate taxes after Jim Concannon’s brother, Joe, died unexpectedly.

The South Valley plan was designed to create a permanent greenbelt of irrigated agriculture around the cities that would be permanently preserved as open space. Tri-Valley Conservancy was established to oversee those lands.

Sparked by the mitigation of 1,500 acres, another 400 acres of vineyards were planted in that decade after its adoption. The number of wineries grew to more than 50, but only Wente now is nationally distributed. Most are small and making 2,000-3,000 cases of wine.

The conservancy commissioned a report in 2019-20 by University of California at Davis experts to determine the economic viability of vineyards moving forward. In contrast to the jumpstart that came from the mitigation acres, nothing similar looms now.

Vineyards must pencil economically.

The initial plantings took place during a boom time for coastal grapes in California when demand soared. In contrast to the Napa Valley and Sonoma County and, to a lesser degree, the Paso Robles area, Livermore has not been established as a uniquely valuable grape growing region. The climate with hot days cooled by coastal breezes and fog in the evening and the east-west orientation plus the soils make it ideal for premium grapes.

The reality, according to the report, is the valley’s Cabernet Sauvignon and Chardonnay make up such a tiny percentage of the state’s coastal grape crop that they’re folded into whatever the market price is. The report identifies that the costs are high enough that the potential return on investment is low.

The report estimates about 2,800 acres of vineyards now, down from a high of about 4,000 acres. What’s of concern to the conservancy and its former president, David Kent, is the viability moving forward with land that has been preserved and has irrigation available but has been fallowed because of the economics.

Kent ran The Wine Group, a worldwide wine company for 10 years, and moved its headquarters to the Concannon estate in Livermore. He retired six years ago and has been working on the Livermore Valley project for the past few years. His wife, Darcie Kent, owns the winery that bears her name and they also own Almost Famous Wine and its performance venue on Vasco Road.

Kent identified two key factors that were expected in the original plan and did not happen:

1. Development of wine country lodging, spas and destination restaurants that enhance the visitor experience.

2. Growth of some smaller wineries into mid-size making 10,000 or more cases a year with broad distribution.

The UC Davis report identified 125 vineyards with 68 smaller than 10 acres and 36 more between 10 and 20 acres. The vineyards account for 878 acres, about 32% of vineyard acreage which leaves two-thirds owned by 20 wineries.

The South Valley plan represented a compromise and contained tight limits, such as on sewer lines, to prohibit development from moving into the open spaces.

Over the last 20 years, it’s become apparent that developing the boutique lodging and other amenities was simply too much of an uphill battle. Beyer Ranch, near the corner of Greenville and Tesla roads, was an ideal site but has been fallow during his entire time at Wente, said chief operating officer and winemaker Karl Wente. One local developer looked at it at length and then walked away.

Consider the hurdles being faced by a company trying to develop a 30-room wine country inn on a site designated for commercial uses at Hansen and Arroyo roads that is served by a sewer line. It was approved by the city, but then challenged successfully in court for not adhering to the 100-foot setback (it was 50 feet). At its meeting on May 22, the council reversed its earlier approval and took other actions to move the project forward.

Currently, there’s only the 10-room Purple Orchid Inn as a lodging option in the wine country. Other Livermore hotels, all national chains, are located on the Interstate 580 corridor.

During the pandemic, Kent negotiated changes necessary to revive the area so irrigated agriculture and tourism have a chance to flourish. He met weekly on Zoom with Jean King from Friends of Vineyards (Livermore) and Dick Schneider, who was a key author of Measure D.

One major change is extending a sewer line because lodging with more than 14 rooms and restaurants cannot function on septic systems — they need city sewer.

Livermore voters approved that with no opposition last fall after the city hurried it onto the ballot. The city had taken a community survey that found more than 80% of residents thought the vineyards were important to their quality of life and the community’s character.

The negotiators also worked out a plan to cluster development, allow boutique hotels of 130 rooms and other amenities without increasing the total development footprint. The county planning department currently is working on those changes to the plan. As both Karl Wente and Kent pointed out, there are 6 million people living within an hour drive or less of Livermore wine country. There are 57 wineries operating here, according to the winegrowers association.

The wineries also have stepped up, agreeing to pay a 2% tax on their sales to support the association. The funds will go to marketing and consultants to work with wineries to improve their wines.

As vineyards are replanted, they need to be much more dense. Most of the mitigation vineyards were planted at 660 vines per acre — replacement vineyards would be twice that dense to produce better fruit and higher yields.

Kent also believes that the valley should focus on grapes that are particularly well-suited to the valley’s terroir: Sauvignon Blanc and Cabernet Franc.

Based on winegrowers’ information, about 53% of the valley is planted in Cabernet Sauvignon with 80% of the whites in Chardonnay. Cab Franc is a rounding error at 1% while 16% is planted in Sauvignon Blanc — they are the parents of Cabernet Sauvignon.

The opportunity is similar to what happened in Napa when phylloxera wiped out the vineyards in the 1980s and growers replanted the valley floor. They switched to primarily Cabernet Sauvignon, and the rest is history.

A similar case history is the Santa Lucia Highlands in Monterey County when Cabernet Sauvignon and Syrah were replaced by Pinot Noir and Chardonnay that were ideal for its climate and soils. Wineries produced premium wine and priced it accordingly. That’s the direction that Kent believes the Livermore Valley needs to go with quality more important than quantity.

Steve Mirassou, a sixth-generation winemaker who owns Steven Kent Winery, has been making upscale Cabernet and Bordeaux blends since founding his Tesla Road winery in 1996. He believes in Cab Franc and is staging the area’s first “CabFranc-A-Palooza” this weekend. He hopes the valley can become known for its Cab Franc. He’s been moving his winery in that direction since the early 2000s.

Not all local wineries are embracing Cab Franc. Dante Robere on Wetmore Road makes about 3,000 cases per year — all reds and most small lot — and sells all of it directly to the consumer through its wine club and tasting room. Co-owner Dan Rosenberg is a fan of many red varieties. Their 6-acre vineyard has three clones of Syrah that Karl Wente selected for the original owner.

When asked about Cab Franc, he said, “If I were king and could control the vineyards, I’d graft them all to Alicante Bouschet and that would make news.” He noted that it was a dominant grape variety in the 1880s and accounted for about one-third of the vineyards.

Incidentally, Wente, like the Dante partners, likes to make a variety of small lot wines, typically offered just to the wine club and at special tasting events. Kent has planted some of the Austrian variety, Gruner Veltliner, on their estate and makes both still and sparkling versions. The still wine was named best of class at the Livermore Valley Uncorked competition.

Elected officials and stakeholders have recognized the mistakes of the past. Whether the current adjustments to the plan will result in a vibrant wine country will play out over the next 20 years. For now, key leaders seem committed to moving in that direction.