of California has estimated that MTBE treatment costs could climb as high as $1.5 billion.

The ban on MTBE resulted and California looked for an alternative. They found it in 200 proof ethanol, blended with gasoline, to form a 10% ethanol blend. The early results are that this blend will burn as clean or cleaner than the MTBE blend, with no water contamination problems. The ATF's National Revenue Center has been fielding many phone calls and processing many applications for Alcohol Fuel Plants and Distilled Spirits Plants which will service the huge demand for 200 proof ethanol in the state of California. BP, the largest refiner and seller of gasoline in California, announced months ago that it would soon stop using MTBE and start using the alcohol blend well in advance of the MTBE ban. Other refiners and dealers, not wanting to lose market share to environmentally conscious Californians, have also speeded up their efforts to implement the ethanol blend.

Several other states have also been adding MTBE to their gasoline and will soon stop this process. This is positive news for American farmers who will realize an increased demand for corn, which has been at or near historic price lows. The United States will be using more of a renewable resource and with the 10% ethanol blend, could potentially reduce oil imports.

Alcohol Labeling and Formulation Division (ALFD) Goes Commodity

By Tracy McNeil (202)927-8140

In our continuing effort to provide efficient and professional customer service to the alcohol beverage industry, the Alcohol Labeling and Formulation Division (ALFD) has changed the way incoming Certificates of Label Approval (COLAs) are sorted and distributed for processing.

Since March of 2000, when recommendations of the Beverage Alcohol Streamlining Team were put into effect, COLAs coming into ALFD were sorted by level of complexity such as easy, hard, very hard, and rejection. Labeling specialists were assigned to corresponding teams and reviewed labels with little to no variation of difficulty.

Effective September 16, 2002, ALFD began sorting COLAs by commodity, i.e. wine, malt beverages, and distilled spirits. Labeling specialists have been assigned to commodity specific teams. The number of specialists on each team reflects the percentage of COLAs received for that commodity. COLAs are much easier to sort this way, leaving less chance of misrouting. Consistency will be easier to maintain among the teams, and labeling specialists will be able to focus on their expertise on one commodity instead of three.

Applicants are to continue submitting COLAs in the same manner as they have previously. We will continue striving to meet our customer service goal of processing all COLAs within nine days.

Alcohol Labeling and Formulation Division (ALFD) Commodity - Specific Seminars

By Leslie Nelson/Marsha Heath (202)927-8140

On September 6th, 13th and 20th, 2002, the Alcohol Labeling and Formulation Division (ALFD) held commodity-specific industry seminars in Washington, DC. In addition to addressing general alcohol labeling and formulation issues applicable to all commodities, the presentations were tailored to address topics unique to the industry whose representatives were present at the particular seminar. The goal was two-fold: to further educate participants on the alcohol compliance topics and to promote a more customer friendly environment.

Presenters included Customer Service specialists, Labeling and Formulation specialists from the Alcohol Labeling and Formulation Division as well as guest speakers from USDA's National Organic Program who addressed upcoming changes impacting the use of organic references on alcohol beverage labels. Topics included an overview of ALFD and its customer service emphasis, detailed information regarding alcohol beverage products requiring formula approval or lab analyses and pre-import product evaluation, mandatory label requirements under the Federal Alcohol Administration Act, organic labeling issues, assistance in completing COLA forms, relevant current topics and the development of COLAs Online--ATF's first e-filing option for industry.

The seminars were attended by approximately ninety industry members; the majority of whom expressed appreciation to ATF in general for its efforts to educate the regulated industries and to ALFD specifically for offering such a productive educational opportunity to the alcohol beverage industry.