It took a decade, but San Luis Obispo County has become the undisputed leader in Tri-County wine grape production.
It has widely overtaken Santa Barbara County, which experienced a formidable vine boom of its own.

The story of how San Luis Obispo County – and the Paso Robles area in particular – ascended to grape dominance stretches back to the early 1970s, when speculators such as insurance companies snapped up land and planted vines. For the most part, they brought large-scale commercial wine grape production to the area for the first time.

But when vineyards fell out of fashion as an investment, many of those companies wandered away. Growth in harvested acres leveled and then sagged through much of the 1980s.

By the mid- to late-1990s, the wine grape industry began to boom along with the rest of California’s economy, forming the basis of Paso Robles’ current dominance and the continuing rise of Santa Barbara County’s Santa Ynez Valley as a wine destination.

In 1997, Santa Barbara County harvested about 9,400 acres of wine grapes compared to its northern neighbor’s 11,100 acres. But by 2007, San Luis Obispo County shot ahead, expanding by 210 percent to Santa Barbara County’s own formidable rise of 127 percent.

Last year, San Luis Obispo’s grapes brought in nearly $142 million, with Santa Barbara County’s fruit worth nearly $100 million.

This year, the area’s grape harvest began as it usually does during the last week of August for some varietals.

The perfect storm

In some ways, Paso Robles became the Tri-Counties leader in wine grape production because it was the right place at the right time at the right price.

“Paso, some many years ago, was considered affordable,” said Chris Taranto, communications manager for the Paso Robles Wine Country Alliance, a group that promotes the area’s wines.
Land around Paso Robles had been cleared after World War II for oats, wheat and barley, said Robert Lilley, San Luis Obispo County’s agricultural commissioner.

The land produced decent grain crops, but “as they started to plant wine grapes there in the 1970s, they found that the quality of the land was exceptional,” Lilley said. For growers, grapes pay better than grain.

In addition to Paso Robles’ long growing season, Taranto can tick off a list of what the area’s 614,000 available acres offer: “Really hot days with cold nights, different types of soil conditions, all of the microclimates that exist here,” Taranto said. “For someone who was in the know about wine growing, if Paso fit in with their goals, this was where they’d arrive.”

Today, Paso Robles’ wine industry becomes more self-sustaining each year. It now boasts more than 250 wineries. And while the county used to export 75 percent of its grapes and process 25 percent locally, it now handles more than half its own fruit.

All the while, Taranto’s organization has pushed to take the wine business by storm from the inside out. “It’s just today that many consumers are starting to understand Paso Robles and that the wine is coming from here,” Taranto said. “It’s had a longer standing with the industry.”

With help from a state labeling law that ensures only wines from Paso Robles bear the area’s name, those efforts have paid off with wine drinkers.

“Every bottle that says Paso Robles is like a little billboard somewhere,” Taranto said.

Although Santa Barbara County has gone from 9,400 harvested acres of grapes in 1997 to 21,263 acres in 2007, it hasn’t displayed the push that Paso Robles has.

That’s partly because of the limits of the land, said Bill Gillette, Santa Barbara County’s agricultural commissioner.

“Our expansion was mostly on old cattle ranches where they didn’t have the water,” Gillette said. “Expansion now is limited by water availability, terrain and, to a certain extent, climatic conditions, as we found out last spring with the cold weather” that killed tender grape buds.

Another reason for moderated grape growth: Strawberries have exploded, with harvested acreage growth of 90 percent and revenue growth of 357 percent in the past decade of records.

Since 2006, the year Santa Barbara County’s crops first brought in more than $1 billion, strawberries have accounted for more than three times the revenue of their nearest competitor.

But land limitations and crop economics aside, the county’s culture and government differ from its northern neighbor.

“[Paso Robles is] a city that has known what it wants to do over the past decade,” said Bill Watkins, executive director of the University of California, Santa Barbara, Economic Forecast Project. “I don’t think Santa Barbara County has had a similar concentrated effort,” he said.

“There’s not a consensus in the [Santa Ynez Valley] about what they want to be,” Watkins said. “To use ‘controversial’ for a project in Santa Barbara County is usually redundant.”

Despite challenges, the industry continues to expand.
Wine grape planting “had leveled off in Santa Barbara County, but there appears to be enough demand that people are planting new vineyards,” Gillette said.

A boon for many sectors

A booming and balanced wine industry brings more than just seasonal pickers to San Luis Obispo County.

“The wine grape actually creates a lot of jobs in other sectors,” such as tourism, non-durable manufacturing, storage and transportation, Watkins said. “A grape job is better for the community than, say, strawberries,” which create many temporary positions.

Wine grapes benefit residents who work outside the industry, too, bringing more amenities such as restaurants to the area. “It makes it a more desirable place to live,” Watkins said.

But despite all the grape business’ blessings, it’s “not at all” a bulwark against San Luis Obispo County’s slumping housing sector, Watkins said.

The grape business is heavily cyclical. This season, San Luis Obispo County growers seem poised to shake off the “grape glut” of last season that depressed prices – they harvested 2 percent more grapes than the previous year, but pulled in 7 percent less money.

“[Stronger grape prices] will help [San Luis Obispo County] offset some of the general issues facing California,” Watkins said. “But it won’t be enough.”