[House Hearing, 114 Congress]
[From the U.S. Government Publishing Office]
OPPORTUNITY RISING: THE FAA'S NEW REGULATORY FRAMEWORK FOR COMMERCIAL
DRONE OPERATIONS
=======================================================================
HEARING
BEFORE THE
SUBCOMMITTEE ON INVESTIGATIONS, OVERSIGHT AND REGULATIONS
OF THE
COMMITTEE ON SMALL BUSINESS
UNITED STATES
HOUSE OF REPRESENTATIVES
ONE HUNDRED FOURTEENTH CONGRESS
SECOND SESSION
__________
HEARING HELD
SEPTEMBER 27, 2016
__________
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
Small Business Committee Document Number 114-073
Available via the GPO Website: www.fdsys.gov
____________
U.S. GOVERNMENT PUBLISHING OFFICE
23-768 WASHINGTON : 2017
________________________________________________________________________________________
For sale by the Superintendent of Documents, U.S. Government Publishing Office,
http://bookstore.gpo.gov. For more information, contact the GPO Customer Contact Center,
U.S. Government Publishing Office. Phone 202-512-1800, or 866-512-1800 (toll-free).
E-mail, [email protected].
HOUSE COMMITTEE ON SMALL BUSINESS
STEVE CHABOT, Ohio, Chairman
STEVE KING, Iowa
BLAINE LUETKEMEYER, Missouri
RICHARD HANNA, New York
TIM HUELSKAMP, Kansas
CHRIS GIBSON, New York
DAVE BRAT, Virginia
AUMUA AMATA COLEMAN RADEWAGEN, American Samoa
STEVE KNIGHT, California
CARLOS CURBELO, Florida
CRESENT HARDY, Nevada
WARREN DAVIDSON, Ohio
NYDIA VELAZQUEZ, New York, Ranking Member
YVETTE CLARK, New York
JUDY CHU, California
JANICE HAHN, California
DONALD PAYNE, JR., New Jersey
GRACE MENG, New York
BRENDA LAWRENCE, Michigan
ALMA ADAMS, North Carolina
SETH MOULTON, Massachusetts
Kevin Fitzpatrick, Staff Director
Jan Oliver, Chief Counsel
Adam Minehardt, Minority Staff Director
C O N T E N T S
OPENING STATEMENTS
Page
Hon. Cresent Hardy............................................... 1
Hon. Alma Adams.................................................. 2
WITNESSES
Mr. Gabriel Dobbs, Vice President, Business Development and
Policy, Kespry Inc., Menlo Park, CA, testifying on behalf of
the Small UAV Coalition........................................ 4
Mr. Brian Wynne, President & CEO, Association for Unmanned
Vehicle Systems International, Arlington, VA................... 6
Mr. Jonathan H. Daniels, President, Praxis Aerospace Concepts
International, Inc., Henderson, NV............................. 7
Ms. Lisa Ellman, Partner, Hogan Lovells US LLP, Washington, DC... 9
APPENDIX
Prepared Statements:
Mr. Gabriel Dobbs, Vice President, Business Development and
Policy, Kespry Inc., Menlo Park, CA, testifying on behalf
of the Small UAV Coalition................................. 25
Mr. Brian Wynne, President & CEO, Association for Unmanned
Vehicle Systems International, Arlington, VA............... 32
Mr. Jonathan H. Daniels, President, Praxis Aerospace Concepts
International, Inc., Henderson, NV......................... 36
Ms. Lisa Ellman, Partner, Hogan Lovells US LLP, Washington,
DC......................................................... 45
Questions for the Record:
None.
Answers for the Record:
None.
Additional Material for the Record:
DJI.......................................................... 52
NAMIC (National Association of Mutual Insurance Companies)... 53
OPPORTUNITY RISING: THE FAA'S NEW REGULATORY FRAMEWORK FOR COMMERCIAL
DRONE OPERATIONS
----------
TUESDAY, SEPTEMBER 27, 2016
House of Representatives,
Committee on Small Business,
Subcommittee on Investigations, Oversight and
Regulations
Washington, DC.
The Subcommittee met, pursuant to call, at 11:00 a.m., in
Room 2360, Rayburn House Office Building. Hon. Crescent Hardy
[chairman of the Subcommittee] presiding.
Present: Representatives Hardy, Hanna, Davidson, Velazquez,
and Adams.
Chairman HARDY. Good morning. I would like to call this
hearing to order.
We are bearing witness to the next great aviation
renaissance. Advances in technology have cleared the way for a
reality that, only a short time ago, was merely a dream. From
the delivery of goods to the survey of land, unmanned aircraft
systems, otherwise known as UAS or drones, are poised to change
how we do business. And with the initial report indicating that
the overwhelming majority of companies operating UAS for
commercial purposes have 10 employees or less, this industry
will truly be a small business industry.
Our airspace, however, is not alone in its experiencing of
the shifting environment. The office charged with overseeing
our civil aviation industry, the Federal Aviation
Administration, is racing to keep pace with the progress being
made, on the ground and in the air, by small businesses across
the country. As the FAA moves forward in an effort to fully
integrate UAS into the national airspace system, the safety of
those in the air and on the ground, and privacy concerns that
many citizens hold dear, must be balanced with the needs of
this industry. This balance must be achieved for economic
possibilities and efficiencies to become a reality.
In my home state of Nevada, which is one of the six FAA
selected UAS test sites, businesses are taking steps to
innovate and test their ideas for commercial application.
However, and I saw this in my district, a lack of guidance from
the FAA regarding our skies was prohibiting companies from
taking much needed next steps.
To address some of the uncertainty and provide a time
framework for the future, FAA took a major step forward by
finalizing the rules for civil operation of small UAS this
summer. Located within Section 14 of the Code of Federal
Regulations, the new rule created Part 107 and includes
requirements and some flexibilities for operators of small
unmanned aircraft, those that weigh less than 55 pounds.
Today, the Subcommittee will hear from industry
participants on how the rules are impacting their businesses
and their future plans now that we are approximately a month
into the implementation of Part 107. I am looking forward to
hearing of the new rule and how it is allowing businesses in
the unmanned aircraft industry to make important strides needed
in this sector to continue growing and innovating at a rapid
pace.
I appreciate all the witnesses for being here today. I look
forward to your testimonies.
I now turn the time over to the ranking member for her
remarks.
Ms. ADAMS. Thank you, Mr. Chairman, for holding this
important meeting. Madam Ranking Velazquez, thank you for being
here as well.
As we have progressed further into the 21st Century,
technology has become increasingly more sophisticated. This
development has brought new opportunities to the United States
and the global economy, which provides exciting new pathways on
the road to innovation.
At the forefront of this innovation is the commercial use
of drones in civilian life, drones which have been mainly used
in military intervention are now becoming commonplace within
our lives. Civilian drone use offers aerial information and
transportation services that are time and cost efficient and
useful in a variety of markets. In fact, some companies seek to
utilize drone technology for deliveries of consumer goods,
while others like real estate professionals use them for
marketing purposes. Drone technology has the potential to
change our lives, and as with any new development, there must
be more discussions of just how much of an impact they will
have. Civilians have, and will continue to have, more and more
usages for drones in their daily lives for personal and
commercial use. But most importantly, small businesses have a
particular interest in drone technology because they are not
only users of these drones, but also manufacturers.
These interests have now pushed this issue to the forefront
of importance and relevance. The Federal Aviation
Administration regulations appear to be beneficial not only for
our overall economy, but also for small firms. The FAA
estimates that more than 7,000 businesses will obtain drone
permits within 3 years.
Today's hearing gives us the opportunity to learn more
about the final regulations and how they will impact small
businesses. I look forward to hearing the insights of our
witnesses, and I thank you all for being here today on the
lasting implications of drone technology on our economy.
Thank you very much. I yield back the balance of my time,
Mr. Chair.
Chairman HARDY. First of all, I would like to explain how
we work around here. If the Committee members have an opening
statement, I would ask that they submit it for the record.
I would like to take a moment to explain the timing on the
lights. You will each have 5 minutes. It will begin green, and
as your time gets down to 1 minute it will turn yellow. And at
the end of 5 minutes it will turn red and we would appreciate
you trying to keep within those guidelines if you can.
Now I would like to introduce our witnesses here today.
First, I would like to introduce our first witness, Mr. Gabriel
Dobbs. He is the vice president of Business Development and
Policy for Kespry in Menlo Park, California, and is working to
help customers use the Kespry UAS to collect and analyze data.
At Kespry, Mr. Dobbs works with civil aviation agencies around
the world to craft policy for the next generation of UAS. In
2014, he secured the first section of the 333 exemption for
drone operations in construction in the United States. Mr.
Dobbs was recently selected for Forbes 30 under 30 list of
having an impact on law and policy in the United States. Mr.
Dobbs has earned his law degree and master's degree from
Stanford University. Prior to Kespry, he worked with Google,
23andMe and SpaceX in various roles. Thank you for being here.
Thank you for bringing a sample of your product.
Our next witness is Mr. Brian Wynne. Mr. Wynne is the
president and CEO of Association for Unmanned Vehicle Systems
International (AUVSI). AUVSI is the largest trade association
representing the unmanned systems in the robotics industry. Mr.
Wynne has significant transportation and technology experience.
He has served in the executive position at the Electric Drive
Transportation Association, the Intelligent Transportation
Society of America, and the Association for Automatic
Identification and Mobility. Mr. Wynne holds a bachelor's
degree from the University of Scranton, and a master's degree
from John Hopkins University. Thank you for being here.
Next, we have Mr. Jonathan Daniels. Our third witness is
the president of Praxis Aerospace Concepts International, Inc.,
in Henderson, Nevada. Praxis is a service-disabled, veteran-
owned small business that provides practical solutions for
multi-modal-ground, air, sea, and industrial-robotics and
unmanned systems. As president of Praxis, Mr. Daniels leads the
design and management of Aerodrome LLC, the ``teaching
airport'' that provides technical education and training to
future and current aviation professionals. Mr. Daniels has
served in the U.S. Army for 23 years and is a retired officer.
He holds a bachelor of science from Excelsior College, and a
master's degree from Kaplan University, and a graduate
certificate in strategic studies from the U.S. Army War
College. Mr. Daniels, thank you for your service.
With that, I would like to turn the time over to Ms. Adams
for our next witness.
Ms. ADAMS. Thank you, Mr. Chair.
It is my pleasure to introduce Lisa Ellman. Ms. Ellman is a
partner at Hogan Lovells where she co-chairs the firm's
unmanned aircraft systems practice, a group dedicated to
helping businesses succeed in the dynamic UAS market. Prior to
entering private practice, Ms. Ellman held top-level positions
in the Obama Administration and the U.S. Department of Justice.
Most recently, she led DOJ's effort to develop policy that
would govern the use of UAS in the United States and
represented the DOJ in the Federal interagency process
considering UAS-related policy issues. She holds a joint J.D./
M.P.P. from the University of Chicago, and a B.A. from the
University of Michigan. Welcome, Ms. Ellman.
Chairman HARDY. Thank you all for being here again.
Mr. Dobbs, we will begin with you. You have 5 minutes.
STATEMENTS OF GABRIEL DOBBS, VICE PRESIDENT, BUSINESS
DEVELOPMENT AND POLICY,KESPRY INC.; BRIAN WYNNE,PRESIDENT &
CEO,ASSOCIATION FOR UNMANNED VEHICLE SYSTEMS INTERNATIONAL;
JONATHAN H. DANIELS; PRESIDENT, PRAXIS AEROSPACE CONCEPTS
INTERNATIONAL, INC.; LISA ELLMAN, PARTNER,HOGAN LOVELLS US LLP
STATEMENT OF GABRIEL DOBBS
Mr. DOBBS. Thank you.
Chairman Hardy, Ranking Member Adams, and distinguished
members of the Subcommittee, thank you for the opportunity to
testify today on behalf of Kespry and the Small UAV Coalition.
This is both an exciting and critical time for the commercial
unmanned aerial systems (UAS) industry, and I appreciate the
opportunity to discuss Part 107, particularly as it impacts
small businesses like Kespry.
I would also like to thank the Small UAV Coalition, the
first group of its kind focused solely on commercial drone
operations, for its leadership in working with policymakers and
regulators to develop a robust, yet flexible framework that
will no longer be built around exemptions and exceptions.
Thanks to its hard work, this industry is now ``open for
business.''
Like many small businesses across the country, Kespry was
started on the floor of an apartment by a few college graduates
passionate about the promise of drone technology and its
potential to have meaningful impact on businesses around the
world. Today, Kespry has been in business for over 3 years. We
have customers operating drones in every state, generating
millions in revenue. We now employ over 60 people and continue
to grow aggressively. Kespry is a ``made in America'' business.
We design and manufacture our fully integrated drone systems
entirely in the United States.
Kespry's mission is to create technology that significantly
advances the effectiveness, efficiency, and safety of workers
in the real world. This can mean everything from creating a 3D
model of hard-to-reach areas of construction, to inventory
management, to identifying damage on structures faster to help
homeowners and businesses get back on their feet after a major
storm.
The drone industry, particularly the commercial sector,
also represents a largely untapped market that stands to add
billions of dollars to our economy. One recent report estimated
that the commercial drone segment will grow to a $21 billion
industry within 5 years. This growth will allow American
companies of all sizes, including small businesses, to create
countless high-paying, highly-skilled jobs, but none of this is
possible without Part 107 and subsequent rulemakings that open
the skies to commercial drones while maintaining the highest
safety standards.
Two years ago, the drone revolution was just beginning and
the FAA had devoted very limited resources to small UAS.
Operators had to ask the Secretary of Transportation for
permission to ignore certain federal regulations on the books
relating to aircraft, since these regulations treated a small
drone the same as a Boeing 777.
In late 2014, the first so-called Section 333 exemptions
were granted. However, the many conditions and limitations on
the FAA's exemption authority were commercially impractical and
significantly limited the growth of the small UAS industry,
leading many companies to conduct operations in other countries
where regulatory advances had been made more quickly.
Kespry worked with partners from the Small UAV Coalition to
help the FAA create a rule that put robust safety precautions
in place for small commercial operations, while eliminating
many of the categorical restrictions in the proposed rule that
would have been economically impractical with no material
impact on safety.
From the moment it went into effect on August 29th, Part
107 was a huge improvement over the Section 333 process. First,
commercial operators no longer need to petition for the FAA
approval if they plan to operate within the scope of the rule.
Second, the FAA no longer requires UAS pilots to have manned
aircraft flying experience, which has little correlation to the
skills required to safely operate UAS.
While Part 107 is a solid first step towards a
comprehensive regulatory framework for commercial drone
operations, there are several key components that the FAA must
address expeditiously or American companies will lose out to
foreign competitors eager to invest in this developing
technology.
As urged by the Small UAV Coalition, Part 107 allows
operators to seek a waiver from several regulatory limitations,
perhaps most notably to operate at night, directly over people,
and beyond the visual line of sight. These elements are
critical to the successful and widespread integration of
commercial drones into the national airspace that will help
create tens of thousands of jobs. Time will tell whether the
waiver process will be more efficient and flexible than the
Section 333 exemption process.
While we appreciate that Part 107 allows for such waivers,
the FAA's next phase of regulations must provide for even more
efficient approval of these type of operations. Technology
already exists that ensures safe beyond visual line of sight
operations and eliminates the need for operators to seek
waivers on a case-by-case basis, a burdensome endeavor for both
companies, especially small businesses and the FAA.
Equally as critical to realizing the full potential of
commercial drone applications is the ability to safely operate
UAS over populated areas. The FAA has announced its intention
to publish a proposed rule for operations over people for
public comment before the end of the year. We hope that the FAA
will act expeditiously to finalize this rulemaking and that the
proposed rule will recognize that very light UAVs pose the
least risk and therefore could be permitted to operate over
people under certain circumstances without compromising safety.
A micro UAS classification would create an even more efficient
regulatory framework, further reducing the burden on small UAS
operators without creating any significant safety concerns.
As you can see, the commercial drone industry standards to
deliver major economic and consumer benefits that will allow
businesses of all sizes to thrive. Part 107 is a positive first
step in developing a comprehensive regulatory framework for
small commercial drone operations. It is also proof that it is
possible to boost opportunities for American innovation and
manufacturing without being overly prescriptive and hindering
industry's ability to compete.
Thank you for the opportunity to appear before you today.
Chairman HARDY. Thank you, Mr. Dobbs.
Mr. Wynne?
STATEMENT OF BRIAN WYNNE
Mr. WYNNE. Thank you, Mr. Chairman, Madam Ranking Member
Adams. It is a pleasure to be here before the Committee today
on behalf of the Association for Unmanned Vehicle Systems
International, the largest not-for-profit organization serving
the unmanned systems and robotics community. We have more than
7,500 members, including many small businesses that support and
supply this innovation industry.
From inspecting pipelines to surveying bridges, to filming
movies, UAS helps save time, save money, and most importantly,
save lives. It is no wonder why thousands of businesses, small
and large, have already embraced this technology. We now have
initial regulations governing civil and commercial UAS
operations, which means even more businesses are cleared for
takeoff. While these regulations have been in effect for less
than a month, there is strong evidence that the commercial UAS
market is poised for significant growth, particularly among
small businesses. Let me explain.
On August 29th, the Federal Aviation Administration
implemented the small UAS rule. The rule established a
flexible, risk-based approach to regulating UAS. This new
regulatory framework helps reduce many barriers to low risk,
civil, and commercial UAS operations, allowing businesses to
harness the tremendous potential of UAS.
It is clear that businesses are eager to take off. On the
first day that the rule went into effect, more than 3,300
people had already signed up to take the aeronautical knowledge
test, a requirement under the new rule. Of the more than
530,000 people who have registered their UAS with the FAA since
last December, about 20,000 have indicated that they are
commercial operators. The FAA expects that more than 600,000
UAS could be flying for commercial use over the next year.
Even before the rule, thousands of businesses had received
approval to fly under Section 333 of the 2012 FAA
Reauthorization Act. The FAA started granting these exemptions
in September 2014 and approved more than 5,500 by the time the
rule took effect. These exemptions provide a window into how
the commercial market is taking shape. AUVSI found that more
than 5,200 distinct businesses received approval to fly, the
vast majority of which were small businesses. Over 90 percent
earn less than 1 million annually and have fewer than 10
employees. For example, one of these businesses is Las Vegas-
based Verascan. It provides imaging, mapping, and surveying
services to Nevada's agriculture, mining, construction, and oil
and gas industries. Recently, it provided aerial survey data to
assist in the construction of the I-11 Boulder City bypass,
part of a proposed highway link between Phoenix and Las Vegas.
This is just one of many businesses around the country
taking advantage of this emerging technology. AUVSI projects
that the expansion of UAS technology will create more than
100,000 jobs and generate more than 82 billion in economic
activity in the first decade following integration. After
witnessing the growth of the industry over the last few years
and now with the small UAS rule in effect, I am confident those
numbers will go even higher.
In addition to the implementation of the small rule,
Congress passed, and the president signed, an FAA extension
which will advance UAS research, expand commercial operations,
and enhance the safety of the airspace for all aircraft, manned
and unmanned. While this measure will provide some short-term
stability through September 27th, it is critical that Congress
pass a long-term bill next year that will set the industry and
the country on a glide path to reap all of the benefits of UAS.
The extension is a good start but there is still a lot of work
to be done.
Government and industry collaboration is critical for
keeping up with the pace of our industry's innovations. Key
stakeholders in the industry and government have successfully
fostered a working relationship that has led to a more flexible
and nimble approach to regulating UAS. At the same time, small
businesses have led the charge in adopting the technology. We
are hopeful that the sustained efforts of all parties will help
pave the way for a true, holistic plan for full UAS integration
that includes beyond line of sight operations, flights over
people, access to higher altitudes, and platforms above 55
pounds.
I look forward to the opportunity to answer your questions,
and thank you for the opportunity.
Chairman HARDY. Thank you, Mr. Wynne.
Mr. Daniels?
STATEMENT OF JONATHAN H. DANIELS
Mr. DANIELS. Good morning, Chairman Hardy, Ranking Member
Adams, and members of the Committee. Thank you for hosting this
hearing and for your invitation to provide testimony.
My name is Jonathan Daniels, and I am honored to be here
today. I am the cofounder and CEO of Praxis Aerospace Concepts
International, a service-disabled, veteran-owned small business
headquartered in Henderson, Nevada.
I cofounded PACI in 2011 with four amazing female veterans,
all of whom had experience in aviation and operations, unmanned
systems, and military intelligence. We had known each other for
years and maintained our connection throughout multiple
organizational changes and combat deployments. We decided to
take the same skillsets and experience that we had used in the
military and create a company that would be at the leading edge
of very disruptive commercial technology: robotics.
We are best known for our activities involving civil
unmanned aircraft systems, which has included flight as public
aircraft, under Section 333 and within Part 107, as well as our
work with several FAA UAS test sites and industry standards
organizations. Praxis Aerospace was a proud participant in
NASA's UAS Traffic Management demonstration of 22 simultaneous
test flights at seven different locations conducted in April
2016. Praxis Aerospace is a proud partner with the Clark County
Fire Department and currently assists the department in
managing its Public Safety Blanket COA. We work cooperatively
with the City of Boulder City, home to the Eldorado Droneport,
the world's first public airport dedicated to UAS, and we are
currently building a prototype cargo small UAS in our Nevada
facilities as part of a collaborative effort between Local
Motors, Inc. and a little company known as Airbus.
First, I want to say that I have a great relationship with
the FAA that dates back a decade to the early days of the
Unmanned Aircraft Program Office. I am very thankful and
appreciative for the work that they do. After spending years
attempting to coordinate flights within European airspace, in
and outside of the European Union, I find the FAA to be
responsive, accommodating, and very open-minded.
As an industry, we hoped for a regulatory structure for UAS
that would be affordable for users and safe for communities on
the ground and in the sky. Many of our peers and competitors
have publicly derided the FAA for their perceived inertia and
misunderstandings. I did not then, and do not now, share their
views. I am grateful for the crawl-walk-run process and its
preservation of the safety of the national airspace system.
The FAA release of Part 107 effectively opened the skies
and lowered barriers for entry of civil UAS. The rules brought
clarity to an industry described by many as ``the Wild West.''
One of the changes out of the Notice of Proposed Rulemaking
was the removal of military competency. We have found that the
statement by the FAA that says that there was no consistent
standard even though there were various different training
methods throughout the Armed Services was correct but not
complete.
In 2009, the Chairmen of the Joint Chiefs of Staff issued
Instruction 3255 for Joint Unmanned Minimum Training Standards
which provided that consistent standard. We feel by leaving
that military competency we have disadvantaged the more than
3,000 enlisted unmanned aircraft pilots who are trained by the
Army and Marine Corps and thus allowing them not to immediately
enter the field.
Looking at safety and equipment, one of the challenges we
have continuing forward relates down to repairmen. The focus
has been on pilots, and Part 107 very heavily has knowledge and
questions about the piloting and not necessarily maintenance.
There is a vast difference between a 40-year experienced AMA
pilot who has built and developed the aircraft themselves to
someone who took a $150 test and bought a $200 airframe at a
local big box store. We found as we look at continuously
operations and expanding the operations to beyond visual line
of sight, operations over people, at night, and altitude, will
have to have a higher level and standard to continue their
worthiness.
The approval and implementation of Part 107 was definitely
a watershed moment for UAS within the United States, and the
new rules provide a substantial foundation for small businesses
to use as an entry point into the multi-million dollar UAS
industry. Part 107 should be viewed as an outstanding success.
We look forward to another 10 years of collaboration with
the FAA. As with any new technology, there are growing pains
for all stakeholders and we, at PACI, are patient enough to
accept that. We are appreciative of the FAA for not conceding
the safety of our National Airspace System to the pressure of
large corporations and their lobbyists.
Thank you, and I look forward to your questions.
Chairman HARDY. Thank you, Mr. Daniels.
Ms. Ellman?
STATEMENT OF LISA ELLMAN
Ms. ELLMAN. Chairman Hardy, Ranking Member Adams, and
members of your Committee, thank you so much for inviting me
here today.
I am here today with a unique understanding of UAS
integration as I have worked on these issues from both the
private sector side--I now lead the UAS practice group at Hogan
Lovells--as well as lead the Commercial Drone Alliance, as well
as the Federal Government side. I worked on innovation issues
at the White House and previously ran UAS policy development at
DOJ.
We are at an exciting time for innovation. Previously
considered toys, UAS have emerged as essential tools for
industry. They make tasks from disaster response to farming to
infrastructure inspection safer and more efficient, enhancing
American productivity.
But as is often the case, technology moves more quickly
than policymaking, and we all understand that, and drones are
no different. And to really ensure the success of this industry
and to balance that with a consideration for the public good,
we need rules that enable innovation while maintaining safety
and privacy and security.
With the proper regulatory framework in place, the economic
benefits the drone market will provide are significant. A
recent PricewaterhouseCoopers report estimates the global
market value of UAS-powered solutions at over $127 billion.
That is significant. And just here in our country it has been
estimated that the domestic drone industry will create more
than 100,000 new jobs over the next decade. And the FAA
recently estimated that by 2020, just 4 years from now, there
will have been 11 million commercial drones sold in our
country.
Now, it is important to note the critical role that small
businesses have played in the growth of the UAS industry. Small
business itself is the engine driving commercial UAS adoption
here in the United States. And UAS are also helping resource-
constrained small business and other industries. They make
dangerous tasks safer and expensive tasks cheaper. Now local
news broadcasters who cannot otherwise afford helicopters, for
example, can now inexpensively obtain aerial footage for major
news events, and farmers can detect and mitigate disease in
their crops, making their products healthier for all of us and
more profitable for them, lowering the cost for the consumer.
For all of these reasons, the broad integration of
commercial drones into the national airspace is an exciting
opportunity, and this summer, as you have heard about, the U.S.
took some critical steps forward. At the end of August, Part
107 went into effect and businesses are now, for the first time
ever, broadly authorized to fly small drones in the United
States for commercial purposes. And the floodgates are now
open. Since the end of August, a few weeks ago, almost 7,000
remote pilot certificate exams were taken, and almost 15,000
applications have been submitted.
Other executive branch agencies have been engaged as well.
The White House recently held a first of its kind workshop on
commercial UAS where commitments were made to move the industry
forward. Industry and nonprofits recently agreed on a set of
privacy best practices as part of a process facilitated by the
National Telecommunications and Information Administration at
the Department of Commerce, and NASA has focused on moving its
unmanned traffic management efforts forward designing
``highways in the sky.'' But challenges and government-imposed
roadblocks to this industry remain, and Congress can play an
important role in clearing these roadblocks, whether through
next year's FAA reauthorization process or by other means.
A few things are critical to small businesses if we expect
to keep America competitive in the global UAS industry. First,
the waiver process. We have talked a bit about the process for
obtaining waivers under this new rule to fly beyond visual line
of sight, over people, or at night. It must be streamlined and
timely. The Part 107 waiver itself, the substance of the relief
that is granted, must also provide the actual ability for
companies to be able to fly drones in the real world for their
intended purpose. And we need additional rulemakings that
broadly authorize safe flights above people beyond visual line
of sight and at night, and we need to see these rules develop
quickly. We also need enhanced government and industry
collaboration. The recently convened DAC, Drone Aviation
Committee, was a good step forward, but policymakers and
innovators must work more closely together at the working level
especially. We call this ``polivation.'' And we must support a
whole of government approach that enables the broader
infrastructure for this industry to succeed. This includes
support for NASA, FCC, and others whose work is critical to the
success of this industry.
And finally, Congress must continue to support Small
Business Administration programs that assist women and
minority-owned small businesses. Two colleagues and I recently
founded the Women of Commercial Drones Organization to bring
gender diversity to the growing drones industry and continued
support for programs like these SBA programs is critical.
If we do this right, the opportunities for our country will
be great. We have made excellent progress in recent months and
it is important that we continue that momentum. And the
industry needs to do its part as well. But if we all tackle
these issues properly together, we will soon regard commercial
drones as we do the phones that we carry and rely on every day.
Tools that make us more efficient, more productive, safer, and
more connected. I look forward to that day. Thank you.
Chairman HARDY. Thank you, Ms. Ellman.
The Committee will now have 5 minutes each to ask their
questions, and I will begin with myself. This is for all the
witnesses here today.
Has the FAA's final rule struck the right balance between
ensuring safe operations and allowing this growing industry and
its participants to operate and innovate properly? We will
start with you, Ms. Ellman, on the left.
Ms. ELLMAN. Sure. Well, I think it is a great first start.
Of course, it authorizes very low risk operations. So vehicles
under 55 pounds, flights within visual line of sight, away from
populated areas or not over people during daytime hours, and it
was a critical first start to broadly authorize very low risk
operations here in the national airspace. And as we have seen,
the floodgates have truly opened and let's just say it is a
huge improvement over the Section 333 exemption process which
was having to ask permission every time a company wanted to be
able to fly. That process was burdensome. Some applications
remained in the queue for over a year. Some never even got
relief. And so it is great that we now have this rule that
broadly authorizes commercial operations. And it is an
excellent first step and the FAA did a great job in that realm.
But to be honest, I think it remains to be seen whether it
struck the right balance because I think that the waiver
process that was baked into the rule is a critical part of it
in order to enable real world operations. And I work with
several companies who have applied for waivers, who have
received waivers, who are getting waivers. But frankly, the
process needs to be streamlined and friendly to consumers. It
cannot be a replication of the Section 333 exemption process.
It needs to move at the speed of industry.
And second of all, the substance of what is actually the
relief that companies are actually getting needs to allow for
real world operations that are safe. And the FAA needs to
actually incentivize safety mitigations and innovations that
make drone flights safer. For example, putting padding on your
drone or propeller guards for drones, or parachutes. Hardware
and software that is out there that can actually make drones
safer, we need to incentivize rather than merely looking in
terms of risk analysis, merely looking at one factor such as
kinetic energy, which is, of course, important, but just one
aspect of the risk analysis.
So I think that the FAA has done--this has moved forward.
It is excellent news, but I think we have a lot more work to
do.
Chairman HARDY. Thank you, Mr. Daniels. Do you care to
comment?
Mr. DANIELS. I do. By delineating the difference between
Part 101 hobbyists and Part 107 remote pilots, I think we very
much have a simple structure. It is obviously based on a
century's worth of aviation knowledge and best practice.
We learned a lot of things about that and that was codified
within those rules. Part 107 established the basic operational
restrictions that we have in Part 103, which has been very
successful for ultralight aircraft. In fact, Part 107 is in
some ways more permissive because with the written test you are
now allowed to do commercial operations which you cannot do
with ultralights. But it is a very similar restriction as far
as airspace and operations and whether you can go over people
or not.
The side piece of that is we talked about the safety
aspect. I briefly mentioned the ``Wild West'' concept and our
desire for a regulatory structure that would allow that use
without being burdensome and onerous. We have got that in Part
107. I think it is very easy to use and it does provide some
level of safety, but I think we need some definite clear
enforcement on the grounds of the black market UAS service
providers. We have a problem with misfeasance and malfeasance.
We have people who are providing their own, you know, they are
providing services that would normally be legal except for
maybe they registered an aircraft recreationally and not
commercially, and they just do not understand what they are
doing, right or wrong.
The other part is that we have the malfeasance, the ones
who know what the regulations are supposed to be, they know
what they are supposed to do, and they choose not to do that.
They do not get their license, they do not register their
airframes, they do not provide the insurance, and I think that
is a little bit of a safety risk, and I think that is part of
that challenge that we are looking for on this balance of how
successful is Part 107 going to be. We need to look at that.
You can search YouTube right now and find some promotional
videos by giant companies that are clearly in violation of Part
107 and it just trickles down from there.
Chairman HARDY. Mr. Wynne?
Mr. WYNNE. I like the balance, Mr. Chairman. The rule
itself is very conservative. The flying that is permitted is
very, very low risk, but the waiver process, we are just at the
very beginning of that. The waiver process allows for us to
make safety cases for more complex operations and the
mitigations that are required to do that. So I think that is
going to generate data, and data is really, really important in
the safety arena, of course. So I think it is a good balance.
Chairman HARDY. Mr. Dobbs, anything else to add?
Mr. DOBBS. Yeah. I think that you have seen just in the
first month of the rule with the number of applications made
for remote pilot certificates exceeding those made in the
previous year and a half of Section 333 exemptions, so you see
this is a much more workable process while still ensuring
safety in operations. It does remain to be seen how well the
waiver process works. So we are looking forward to seeing how
the data pans out over the next few months.
Chairman HARDY. Thank you. My time is expired. One question
and my time expired.
I will turn the time over to Ms. Adams.
Ms. ADAMS. Thank you, Mr. Chair.
Ms. Ellman, you mentioned the need for Congress to continue
its support of SBA programs that assist women and minority-
owned business firms. Is there anything that we can do to
improve inclusion and diversity, not only in the drone industry
but the business community at large?
Ms. ELLMAN. Ranking Member Adams, thank you so much for
that question. Absolutely.
As we have talked about today, the commercial drone
development and sales are on the rise, but unfortunately, the
number of women in leadership positions, whether in the drone
industry or more generally in technology is not.
Diversity is an important issue, not only for our own
industry but also for the business community generally. Of this
year's Fortune 500 list, women held only 4.2 percent of CEO
positions in America's 500 largest companies, and aviation in
particular, some numbers I saw from the last few years
suggested that women pilots represented somewhere around 6
percent of the total pilot population.
Diversity of critical not only for the individuals who are
seeking employment, but it also helps businesses to succeed in
all industries, including the commercial drone industry, will
benefit once we have more women and minorities in leadership
positions. It is healthy and beneficial for any organization to
hear different viewpoints at the top.
So my own view is that long-term effort must start at the
elementary school and middle school level. STEM efforts need to
focus on programs getting young girls interested in these
subjects, and as increasing numbers of women go down the path
of engineering and technology, it is the job of our country's
leaders all working together to work with industry and with all
of us to foster and to develop this growth.
We can help establish formal mentorship programs for women
to help navigate technology and engineering careers, and we can
continue to support minority-owned small businesses as we are
today.
Ms. ADAMS. Thank you. The commercial drones organization
that you have cofounded, can you speak a little bit about that?
Ms. ELLMAN. Sure. So a few amazing colleagues and I
recently founded the Women of Commercial Drones. We
participated in many of the drone shows, and we looked around
frankly and we realized just how male dominated the field is.
Of course, this is typical in Silicon Valley. And so
recognizing this, we founded this Women of Commercial Drones
organization. The purpose of this organization is really to
encourage and mentor women and young girls at an early age to
become a part of this new and growing drone industry and help
women to succeed and grow as leaders in this industry.
The great news is that we have been contacted by literally
hundreds of women who want to get involved, and we hope to
really be able to encourage women to be bold in pursuit of
their careers in this market. Our industry will be better off
once we are more diverse.
Ms. ADAMS. Thank you. UAS operations are relatively new,
meaning few aviation insurance carriers offer coverage or have
only begun recently to do so. One study found that two-thirds
of businesses operate without commercial liability. So Ms.
Ellman, do you think that the clarity that the new rules bring
to the industry will improve the availability of insurance?
Ms. ELLMAN. I do. Absolutely. Insurers have been in an
interesting spot, right, because they are essentially
policymakers in addition to UAS users. They have also suffered
from regulatory uncertainty in that they have not understood
how to assign and value risk. They have all been guessing
essentially. But now that we have the rule in place and they
have some guidance on what is authorized and what we can
expect, I definitely expect to see more insurers entering this
market. And I do think that we will see more businesses
adopting drone insurance. Just as good business practice, I am
seeing more and more customers and end-users requiring it.
As well, FAA resources are limited and regulators do not
have the time or energy to go after every illegal flight that
happens. We have heard about this from others. Civil liability
in case of an accident is what they are going to worry about,
and for many of these small companies, one accident can mean
their whole business is at stake. So yes, I do think we will
see more availability, and as a result, more companies get
insurance.
Ms. ADAMS. Thank you.
Mr. Wynne, your association predicted similar growth if FAA
developed favorable drone regulations. So do you believe the
final rule goes far enough to allow for this kind of job
growth?
Mr. WYNNE. Not this rule, no. But the good news is there
are additional rules that are in process and the waiver process
itself will, I think, allow for us to extend value. But I think
there is a tremendous amount of value that gets unlocked under
these rules for inspection of vertical infrastructure for
flying over farming and things like that. There is just a very
long list of things that can be done under Part 107.
Additionally, we need, you know, the broadcasters have been
mentioned. There are others that need the ability to fly over
people. That rulemaking has already gotten started and the good
news is that we have pathfinder programs that have been
underway sort of point at where we need to be in order to prove
the safety cases for beyond visual line of sight operations, et
cetera. There are also very large platforms that will also be
allowed to fly ultimately, and in some instances, that rule
making is easier because when you get into the flight levels
above 18,000 feet, we do not like deviation. So it will be more
predictable.
Ms. ADAMS. Thank you, sir. I am out of time.
Mr. Chair, I yield back.
Chairman HARDY. Thank you, Ms. Adams.
I would like to turn the time now over to the chairman over
Contracting and the Workforce, Mr. Hanna.
Mr. HANNA. Aviation does not love you sometimes, too;
right? It is a two-way street.
I am a pilot, and I have Griffiss Air Force Base, which you
know is one of the six. And I think it is a great opportunity.
I mean, you have all laid that out quite well. I am a little
surprised, Mr. Daniels, for everyone to be so positive about
the FAA because frankly, most people are not. And the idea that
they originally thought you had to have a pilot's license for
this or that Japan has had these larger, much larger for
agriculture and other purposes, for 20 years, we are way behind
the eight-ball. And a lot of it is our inability to deal with
regulation in a timely fashion and an emphasis on safety is
appropriate, but frankly, not always practical.
The line of sight issue, the night issue, the fact that I
can own 10,000 acres and I cannot go over 400 feet and I have
to see this thing is silly on its face, and I will be blunt. So
I want to talk about something.
Like agriculture, it is just a tremendous opportunity. One
of the largest hazards to pilots today are ag crop people,
people who fly and spray have one of the highest illness rates
of any profession, and yet we have this opportunity to have
larger drones over big areas and isolate the amount that we
spray and limit the amount. You know all this.
So I want to ask you, because I have watched the FAA. I
have been here 6 years, and I have watched this process move I
think for some things at a snail's pace. One of them is the
idea of agriculture. So line of sight makes not a lot of sense
to me, and I understand that over populated areas. But line of
sight and elevation of 400 feet for, you know, that may be an
appropriate elevation. I would like to give anyone who wants to
talk about it an opportunity to either agree with me or
disagree with me or see what you would like to see differently,
because I think that is something that someone could do that is
elementary and could be done very quickly and without a lot of
problem.
Mr. Dobbs?
Mr. DOBBS. Thank you. Yes. We actually agree with you. We
are very happy that Part 107 is finally in effect and it really
opened things up for the industry, but there is still a lot of
work to be done. There are technological solutions to flying
beyond line of sight. On the drone that I brought in today,
there is technology for sense and avoid that allows drones to
avoid obstacles that are unexpected. There is also technology,
including geofencing, which keeps the drone on a particular
parcel of property below a particular elevation. So there are
all these kind of technological solutions to ensure safety in
operations. And we have also seen overseas risk-based
regulation where we do not treat a 2-ounce drone the same way
we treat a 50-pound gas-powered drone. And we would like to see
in future rulemakings that are now under consideration micro
UAS classification and looking at both the weight of a drone
and the operational----
Mr. HANNA. My son owns about 20 of those.
Mr. DOBBS. That is right. Yeah. And they----
Mr. HANNA. There is no permanence there.
Mr. DOBBS. They do not pose real risk. Obviously, smaller
drones in more remote areas pose a very different risk than a
larger drone flying over a crowd of people at a sporting event
or something like that.
Mr. HANNA. My point is that, I mean, the FAA in an effort
to be safe, and I get that and everybody does, and that is
their job, but it should not mean that they drag the process
out in a way that guarantees that they never have a problem
that comes back to them.
Mr. DOBBS. And we agree. And we are very hopeful that with
the FAA reauthorization next year that Congress will help push
for some new rules and that simultaneously, the FAA will be
going through the rulemaking at a little bit of a quicker pace.
Mr. HANNA. But the permit process for agriculture ought to
be much different than the rest of it and it is not, the
exemption. So, I mean, you ought to be able to----
Mr. DOBBS. Yeah. We absolutely agree. So Part 107 does
allow for operations over less populated areas more easily than
it does near airports and in large cities. But there is not
that risk-based classification system yet that differentiates
between drones of different sizes and in remote areas versus
more populated areas.
Mr. HANNA. Thank you. My time has expired.
Chairman HARDY. Thank you, Mr. Hanna.
I would like to turn the time over to the ranking member on
Small Business, Ms. Velazquez.
Ms. VELAZQUEZ. Thank you, Mr. Chairman.
Mr. Dobbs, some countries have already solved some of the
airspace integration problems that the FAA is addressing in
these rules. Do the new regulations allow us to solve these
issues at the same pace as other countries?
Mr. DOBBS. Thank you for the question. The new rule, Part
107, is a great step forward and has opened the skies for some
use cases, but there are still many, including operations at
night, beyond line of sight, operations over people, that are
restricted under the new rule. So there is still work to be
done and we are hopeful that new rulemakings will help solve
this along with perhaps some new rules as part of the FAA
reauthorization next year.
Overseas, we do see risk-based systems that take into
account where the drone is operating, what the use case is, and
what the size and weight of the drone is that better address
these safety questions.
Ms. VELAZQUEZ. And are those steps that those countries are
taking in terms of addressing the issue of integration, would
you think that these are the type of steps that you would like
to see happen here?
Mr. DOBBS. Absolutely. We see in many European countries,
and Australia and Canada, there are weight-based
classifications for drones, so drones under about 4-1/2 pounds,
which our new drone is built to be under that weight, are
treated differently than larger drones, and there are different
weight classifications and different safety standards for
things like beyond line of sight flights. So we would like to
see those come to the United States as well.
Ms. VELAZQUEZ. Thank you.
Ms. Ellman, you noted in your testimony that with the new
regulatory certainty, additional funding dollars will be
flowing into the industry. Has the industry suffered from a
lack of access to capital?
Ms. ELLMAN. Yes. Thank you for this question.
Over the past several years, investors have started to
invest more money into the drone market, but in the first
quarter of this year we did see corporate activity dipped, but
because in addition to the murkiness of the regulatory
environment, investors were also concerned with public
perception and privacy issues. This is something that our
industry is confronting, and it is very important that we do.
But with Part 107, investor skepticism has really declined and
funders are looking to aggressively fund more companies in the
drone market and this is a great thing. And with this increased
regulatory certainty, it was a huge step forward, investors
understand the market is really going to grow, and quickly, and
they are also more knowledgeable about the industry as a whole.
And so they can make smart decisions. So I do expect we will
see more mergers and acquisitions and investors in money
flowing into the industry helping many of these small
businesses that have thus far suffered as a lack of result of
the regulatory certainty, but funders will understand that now
is really the time to get in.
Ms. VELAZQUEZ. If there is anything that you think that
Congress can do to spur investment into the industry.
Ms. ELLMAN. Yeah. Absolutely. I mean, I think a lot of what
we have talked about here, because so much of the investment
money held back because of regulatory and policy issues is
really supporting this whole of government approach to
integration, providing funding, providing regulatory oversight
so we can make sure we are meeting our deadlines and quickly,
enabling the broader infrastructure for this industry to
succeed. So we have talked about the NASA, UTM--unmanned
traffic management--efforts, designing highways in the sky. The
FCC spectrum issues is another example. They are critical where
we need to consider. In order to be able to have beyond visual
line of sight flights and cargo flights, we need this
infrastructure.
So Congress can also support state and various state
efforts that promote commercial drone innovation and growth,
and use your funding, oversight, and bully pulpit functions.
This hearing is a great example to ask all relevant agencies to
engage with the industry now with a focus on finding solutions
that can enable commercial UAS integration safely and broadly
and in an expeditious way.
Ms. VELAZQUEZ. Thank you, Mr. Chairman. I yield back.
Chairman HARDY. Thank you. I turn the time over to Mr.
Davidson.
Mr. DAVIDSON. Thank you, Mr. Chairman. Thank you all for
coming here and talking about an important and emerging market
in the United States and around the world. I appreciate your
perspectives, and I want to ask a little bit more about some of
the testimony.
So Mr. Wynne, in your testimony you describe a new
regulatory framework as a flexible, risk-based approach to
regulating UAS. For those of us who are not familiar with how
the FAA currently crafts its regulations, what is different
about how the FAA is regulating unmanned aircraft?
Mr. WYNNE. That is a great question. Like Congressman
Hardy, I, too, am a pilot, and there are probably others in the
room. And the FAA is very control-oriented when it comes down
to the smallest parts that go into an aircraft. And when you
are flying, and we all fly, that is important.
With unmanned aircraft, that certification process, for
example, will become very burdensome. This technology iterates
very, very quickly, and in fact, we are advancing the
technology and making it safer all the time. So when we say
risk-based and flexible, what we are actually doing is creating
an environment that allows for the safety to continue to
improve at the speed of technology rather than constraining it
by a regulatory process.
Mr. DAVIDSON. Thank you.
Ms. Ellman, from your perspective, what are the most
pressing safety, privacy, and security issues that must be
addressed in the regulatory environment that you referenced?
Ms. ELLMAN. Well, I think we are well on our way. In terms
of safety issues, of course, what the federal government really
cares about is--what the FAA really cares about on safety
issues is, is a drone going to fall out of the sky or fly away
at any time? And the key is that there is innovation and new
technologies that make drones a whole lot safer, and the new
regulations should really incorporate these new technologies as
it is considering its additional rulemakings on, for example,
beyond visual line of sight flight, night flights, that kind of
thing.
Security issues, of course, there is a lot of talk about
counter UAV technologies. As drones become more ubiquitous,
people are worried about is a drone flying over my backyard?
Companies are worried about whether drones are flying in their
vicinity. Prisons, we have heard a lot about this. And so, of
course, that is another area where actually the policy has very
much lagged behind the technology. We have technology that can
detect, identify, and track unwanted or unauthorized drones,
but the question is what can you do with it? And it is unclear
at a policy and legal level as well.
And, of course, the privacy issues, this is what the
American public is most focused on. Are the privacy issues
about is a drone spying on me in my backyard? There are a whole
long list of privacy laws and rules that are technology neutral
that do protect us already. But, you know, the White House
released a presidential memorandum on UAS privacy issues, and
as part of that required the NTIA (National Telecommunications
and Information Administration) at the Department of Commerce,
to convene a group of industry and stakeholders, as well as
privacy advocates. And just this May we all came to consensus
around a set of best practices around privacy, transparency,
and accountability related to the private and commercial use of
UAS. And so with that in place, our next task is simply to
educate the UAS community, educate the public. There are laws
and rules in place that already protect them, and we do not
necessarily need duplicative efforts.
Mr. DAVIDSON. Thank you.
Mr. Dobbs, could you highlight some of the safety features
that are designed, common practice now and what sort of gaps
are out there in the R&D world?
Mr. DOBBS. Absolutely. Thank you for the question.
So first of all, it is pretty common practice to have
geofencing whenever you fly a drone. And that makes sure that
your drone stays in the area, both vertically and horizontally,
that you intend to operate in. So that is a critical piece to
make sure that drones are not operating in too congested
airspace.
The next generation of technology includes sense and avoid.
So that is something that Kespry has built into our drone. We
use a laser to scan for potential obstacles, which is critical
for unexpected trees or structures or even other drones
operating in more congested airspace. In the future, we have
been working with NASA on UTM. NASA has led this effort on
unmanned traffic management in creating this highway in the sky
so that drones can talk to each other, and for full integration
into the airspace, actually talk to other manned aircraft. So
those are some of the critical technology developments that are
being worked on now.
Mr. DAVIDSON. Thank you.
And Mr. Daniels, similar question. What kind of things are
opportunities or threats to your business as you develop?
Mr. DANIELS. Well, I think that is part of the challenge is
that when we talk about expanding out into agriculture and
beyond visual line of sight and that technology, you have a lot
of export compliance and ITAR regulations that limit that as
well, agriculture being one of them. Even though we have
recently opened up to nonmilitary unmanned aircraft as a
special categorization, that becomes an additional part of the
challenge. And those are things the FAA has no control over and
cannot mandate. So I think part of that is as we expand that
technology, we find those gaps, either we cannot apply the
military technology we do have or we have to create new ones
outside that.
Mr. DAVIDSON. Thank you.
Mr. Chairman, I yield back my time.
Chairman HARDY. Thank you.
We still have some time and I would like to ask a number of
questions, so we will go through one more time.
I would like to begin with Mr. Daniels. In your testimony,
you indicated that the FAA's regulatory framework should take
into account veterans with unmanned air systems training and
make it easier for them to obtain an unmanned aircraft operator
certificate with small UAS rating. Can you explain why this is
important and how the rule's initial testing requirement would
deter veterans with relevant UAS training and experience from
not applying for remote pilot certificates?
Mr. DANIELS. Yes, Mr. Chairman.
So as it sits right now, the military has been using
unmanned aircraft for 70-plus years; right? JFK, his older
brother was killed in an unmanned aircraft accident. We kind of
forget that sometimes. We think this is a new industry. In the
last 20 years, the majority of experience people have with
operations over people, beyond visual line of sight, flying at
night, flying at these upper altitudes, has been done by the
military. Much like we do with military manned pilots, we have
a military competency test that the FAA gives, and then you
have to prove you have the knowledge, but you do not have to go
through the exact same application process that you do as if
you are starting out as a civilian pilot. They take recognition
of that timeframe, that recognition, that experience.
I think especially starting with the remote pilot
certificate with the smalls, again, the majority of the people
who fly small unmanned aircraft systems within the United
States, it still is the military. The military does 1.1 billion
hours of small unmanned aircraft flight a year, and they are
enlisted, nonrated pilots who do not have pilot licenses and
have to go through the normal process.
As we go to the larger systems, beyond 55 pounds, again, we
have thousands of military pilots who are there. If we want to
grab that experience and get that into the workforce, again,
taking a disadvantaged community, that being veterans, this is
the way we have to go forward.
Chairman HARDY. Thank you.
Mr. Wynne, have you obtained a remote pilot certificate
with the small UAS rating under this new rule? And if so, did
the process go smoothly?
Mr. WYNNE. Yes, sir, I have. The process was smooth. I am a
Part 61 certificated pilot, so I went through that process and
have recently been looking at what is on the knowledge-based
test, and I think it is consistent with the kinds of skills
that we would want all airmen to have. And the good news about
the way they have rolled this rule out is that the concept in
aviation of pilot in command is ``I am responsible for the safe
conduct of my flight.'' We have added remote in front of that.
So, but they have done away with things that are not required
for pilots of manned aircraft, and I think that is the right
way to go. And by the way, I completely support what Mr.
Daniels is saying about military pilots. We have a tremendous
reservoir of talent out there that the United States taxpayer
has paid for that is waiting to go to work for us and large
industries that want to take advantage of that, and we should
make this technology and these job opportunities as accessible
to our veterans as they are for the rest of us pilots.
Chairman HARDY. Thank you.
I would like to go back to Mr. Daniels. In your testimony,
you note that Praxis Aerospace has been involved in the
development of the Eldorado Droneport. Can you explain what a
droneport is and how you envision them operating in the future?
Mr. DANIELS. Thank you again.
So the Eldorado Droneport is a public development by the
City of Boulder City. It is 50 acres of land surrounded by 100
acres or 100 square miles rather of city-owned land. It is
actually working in concert with the Oneida County and Griffiss
International Test Site. And the intent there is as we talk
about going from nonscheduled flights to scheduled flights,
right now the majority of unmanned aircraft flights are
relatively impromptu and intermittent. We go out and we fly
from a location, conduct a surveillance, conduct a survey,
conduct an agricultural mission, whatever it is that we are
doing, and then we leave and never fly there again. As we start
getting larger systems, as we start getting to more scheduled
flights, like delivery and cargo, you are going to want to have
a location where that is done and where that is carefully
scoped out for safety concerns--the lighting, the building
codes around there. Additionally, we want to be able to expand
that out. We do that with helipads now. So if you think of a
helicopter that can land anywhere, there is a reason why we
have helipads. Nobody wants Amazon drones coming in to do a
delivery, a bunch of kids to come running out in the landing
area. We need to figure out how to put that in place. What we
are trying to do with the droneport is have a site to do that,
again, tied in with the test sites as they are right now and
then continuing to build forward so that as we go forward in
the future, just like we did with Internet cafes where that was
the place where you got your Internet and now we all have it on
our cell phones, well, this will be the place where you learn
how to take off and land from a droneport, and eventually it
will be everywhere and you will not need a dedicated drone port
for that.
Chairman HARDY. Thank you. And I am out of time again.
Ms. Adams?
Ms. ADAMS. Thank you, Mr. Chair.
Mr. Daniels, one survey conducted showed that many
companies are unclear of the current FAA regulations, yet they
continue to operate commercial drones anyway. The arbitrary
decision to follow rules is troublesome as it could present a
risk to the public safety. What can be done to avert a
recurrence of this behavior and increase the level of public
adherence to the regulations?
Mr. DANIELS. Ma'am, that is a very good question and one
that I have literally spent sleepless nights over looking at.
The idea of arbitrary rule following, again, that is a
misfeasance/malfeasance. Right? Some people do it by accident.
Some people do it deliberately. But it damages the industry as
a whole. And it is coming. When there is that thing that
happens that draws the attention, no one is going to look at
whether they were doing the right thing or not. No one is going
to look at whether they are actually following the rules. They
are going to look at it as an industry-wide failure.
One of the things I say behind that is bring in the
veterans because we have a lot of experience here. Another
thing I talk about is repairmen. The whole focus for Part 107
is on remote pilot, not on the repairmen, not on the continued
airworthiness. For us to do the missions that Mr. Dobbs, Mr.
Wynne talk about, we are going to need people to keep those
aircraft in the sky, much like we need mechanics working on our
cars right now. We need to add that in there.
And then finally, and I have joked about it before, we need
a 1-800-BADRONE or some measure to, you know, Crime Stoppers,
some measure to say, look, I have been at a jobsite where a guy
flies up to go with his little phantom drone and takes off. And
as we talked through and said, okay, do you have your
certificates, they immediately packed everything up and ran
away. But we need a way to self-police and maybe escalate that
a little more to whether it is local law enforcement or the
FAA.
Ms. ADAMS. Thank you.
Are we going to fly this drone today, Mr. Dobbs?
Mr. DOBBS. It does not fly indoors.
Ms. ADAMS. Oh, okay. Okay.
Mr. Daniels, let me follow up and ask you about the
proposed rule that sought comments on whether there should be
an inclusion of a micro drone category. Ultimately, a micro
drone category was not included in the final rule, so how large
of a role can we expect micro drones to play as commercial
drone uses expand?
Mr. DANIELS. Ma'am, that is another good question, and I
had the opportunity to address the micro UAS ARC about this.
My challenge with the micro drones is that at a certain
point, until the technology gets there, we do not have the
ability to integrate the things that we know we need for
safety--the sense and avoid, the transponders, things that you
will need to fly free and openly, even under Part 107 and the
Part 107-type waivers. You just cannot get that on an airframe
that weighs 500 grams or less. However, I see a lot of
opportunity in public safety. I know that is one of the things
that militaries use that will definitely transfer over where if
you have a drone in your pocket as a fireman, you are able to
bring that to a local situation and immediately get eyes on.
Under the rules as they exist right now it is a fantastic use
for micro drones. It is much less expensive than not only large
commercial aircraft that we have right now but also some of the
larger drones. The second piece of that is you could put one of
these things in a box next to your fire alarm, and when the
fire alarm goes off the box opens up, the micro drone comes out
and can actually run up and down the halls and give you
immediate information to feed whoever is coming to help rescue
you, whether it is the fire department, law enforcement, it
does not matter. You have an immediate eyes on. I see a lot of
opportunities for micro drones.
Ms. ADAMS. Okay.
Mr. Wynne, we talked a little bit about security and we
know the risk that hacking plays in security, and drones are
just as liable to this threat as other forms of technology. So
how likely is it that a drone hacking can or will occur?
Mr. WYNNE. Well, I think it is likely enough that we as an
industry have got to take measures against it. And this is one
of the phenomenon that we in a rapidly advancing technology
industry face, like all technology industries. The Internet has
caused all manner of challenges with regard to privacy and
other things and we have anti-virus software for the Internet,
so our industry, one of the fastest-growing elements of our
industry will be counter drone technology, for example.
I was at a cyber conference last week in Newport News and
listening to people across the spectrum of technology talking
about cyber challenges. It is significant. But it is no
different for our industry than it is for the healthcare
industry or for any other industry. So, but that is the reason
I was there because we need to learn across those industries.
Ms. ADAMS. Great. Thank you very much. I yield back, Mr.
Chair.
Chairman HARDY. Thank you all for being here.
But I am going to take the liberty of asking one more
question. I will begin with you, Mr. Dobbs, and anybody else
who would like to address it can.
As of September 20, 2016, the FAA had received 552 waiver
requests under Part 107 and approved 79. However, the 79 waiver
requests that have been approved were submitted under the
Section 333 exemption before the final rule effective date.
Does the fact that the FAA has not approved the new waiver
requests submitted since Part 107 went into effect give you any
concern?
Mr. DOBBS. That is a great question. Thank you, Chairman
Hardy.
Absolutely. We are concerned that the waiver process will
be similar to the Section 333 exemption process in that it will
take quite a bit of time for these waivers to work their way
through the system. What we saw with Section 333 is deadlines
being missed, and there are also many use cases after a storm
when you need to inspect homes or track progress on a
construction site, it is critical that these waivers be
processed quickly or we even create a system where these
waivers are not necessary. But it is a real concern that we are
watching.
Chairman HARDY. Thank you.
Anybody else?
Mr. WYNNE. I think as I understand it, what is happening
now is that the UAS Integration Office inside of the FAA, which
is exclusively devoted to this, is now pulling in resources
from the entire FAA. It is easier for them to identify who is
not working on UAS at this point than who is. But a lot of
those offices are relatively new. So they made a point, Earl
Lawrence, the head of that office made a point of explaining
that when you put in a waiver that is not necessarily going to
come into our office. It is going to get directed to a
different office, and I think all of those people are trying to
understand exactly what their roles are. But we have been
emphasizing the importance of cadence, and yet we have to find
that balance. I think like the 333 exemption process, it will
accelerate over time, but will be clearer to those that are
requesting waivers and permission to fly under certain
circumstances, what the mitigations are they need. That will be
communicated out to the public at large and this process will
move quicker.
Chairman HARDY. Thank you.
Mr. DANIELS. Mr. Chairman, if I can add to that.
The FAA is working with ASTM, an industry standards
organization, specifically on addressing an alternative method
of compliance for this that will help accelerate the waiver
process, as well as form the guidelines for the operations over
people, beyond visual line of sight. And they have been doing
so for a year and a half that I have been personally involved
and I am sure well beyond that. The idea again is you have an
industry standard that is self-certifying, self-compliant, and
you have to meet what is within there, much like we do with
underlying laboratories as it is now--provide that to the FAA,
and it makes it much easier for them to inspect it. It follows
their formats. It follows their questions. You have everything
in line with that. And I know the delivery date for those is
within the next 6 months. So I see that changing and being a
much easier process, knowing for a fact that they are building
a standard specifically for the waivers for Part 107 now.
Chairman HARDY. Thank you.
Ms. Ellman?
Ms. ELLMAN. Yeah. So one area I would talk about is in
terms of flights over people. One thing to watch here, I know
the FAA is requiring a lot of quantitative analysis, ballistic
gel tests, drop tests, and this is where, you know, in addition
to kind of all this data that is out there, it is important
that the FAA actually consider the operational and technical
mitigations in addition just to kinetic energy, which I think a
lot of folks look at what is being required in the flights over
people context and frankly, it is going to be a tall--if the
process is as intense as it looks offhand, it is not going to
go in any expedited way. And as the industry evolves, we really
want to be incentivizing safety and incorporating this
innovation and incorporating parachutes and propeller guards
and padding for vehicles and allowing those mitigations to
actually get broader approvals. I think what we are seeing is
very, very narrow approvals for things that even weigh about a
pound or so. And so I think that this is critical as we move
forward that this has to be a scalable process, something that
small businesses across the country are going to be able to
meet that are operating safely. Small businesses want to
operate in a way that is safe, and we need to be able to
incorporate innovation so that we can actually move this
process forward and provide real opportunities to use these
devices.
Chairman HARDY. Thank you. Thank you all for being here
today. I appreciate your testimonies.
As the FAA opens the skies to commercial drone activity,
the new avenues of economic opportunity are opening for the
startup and small business communities. The Subcommittee will
monitor implementation of the Part 107 and how well the new
regulatory framework is working for small companies. We will
also continue to encourage the FAA to diligently move forward
with its efforts to safely integrate UAS into the national
airspace while addressing safety, privacy, and other concerns.
I ask unanimous consent that all members have 5 legislative
days in order to submit their statements and supporting
materials for the record.
Without objection, so ordered.
This hearing is now adjourned.
[Whereupon, at 12:10 p.m., the Subcommittee was adjourned.]
A P P E N D I X
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
Prepared Statement of Gabriel Dobbs
Chairman Hardy, Ranking Member Adams, and distinguished
members of the Subcommittee, thank you for the opportunity to
testify today on behalf of Kespry and the Small UAV Coalition.
This is both an exciting and critical time for the commercial
unmanned aerial systems (UAS) industry and I appreciate the
opportunity to discuss Part 107, particularly as it impacts
small businesses like Kespry. We applaud the Subcommittee's
interest in this new framework as it underscores your
commitment to ensure that the United States has a regulatory
environment conducive to innovation and job creation for
businesses of all sizes.
I would also like to thank the Small UAV Coalition--the
first group of its kind focused solely on commercial drone
operations--for its leadership in working with policymakers and
regulators to develop a robust, yet flexible framework that
will no longer be built around exemptions and exceptions.
Thanks to their hard work, this industry is now ``open for
business.''
Like many small businesses across the country, Kespry was
started on the floor of an apartment by a few college graduates
passionate about the promise of drone technology and its
potential to have meaningful impact on business in America and
around the world. Today, we have been in business for over
three years. We have customers operating drones in every state,
generating millions in revenue. We now employ over 60 people
and continue to grow aggressively. Kespry is a ``made in
America'' business. We design and manufacture our fully
integrated drone systems entirely in the United States.
Kespry's mission is to create technology that significantly
advances the effectiveness, efficiency, and safety of workers
in the real world. This can mean everything from creating a 3D
model of hard-to-reach areas of construction, to inventory
management, to identifying damage on structures faster to help
homeowners and businesses get back on their feet after a major
storm.
In less than 30 minutes, for example, a Kespry drone can
provide aerial imaging and mapping solutions for a 150-acre
construction site that allow project managers to track
progress, manage resources, and complete projects on schedule
and under budget. It takes less than five minutes for a Kespry
drone to survey a roof to evaluate damage and thus inform
repairs and claims adjustments, eliminating the need for
insurance companies to put employees and contractors at risk of
physical injury by climbing ladders and walking on damaged
roofs. A quarry can use a Kespry drone to accurately measure
the volume of stockpiles in a matter of minutes, rather than
days. We save businesses time and money, and give workers an
invaluable tool to improve safety and automate dangerous, time-
consuming jobs.
The drone industry, particularly the commercial sector,
also represents a largely untapped market that stands to add
billions of dollars to our economy. One recent report estimated
that the drone industry as a whole could be valued at $100
billion by 2020. The largest area of growth lies in the
commercial segment, which is estimated to grow to a $21 billion
industry within five years. This growth will allow American
companies of all sizes, including small businesses, to create
countless high-paying, highly-skilled jobs. These economic
benefits will also permeate through other industries, from
insurance to component manufacturers. But none of this is
possible without Part 107 and subsequent rulemakings that open
the skies to commercial drones while maintaining the highest
safety standards.
Early FAA UAS Regulations
Two years ago, the drone revolution was just beginning and
the FAA had devoted very limited resources to small UAS.
Operators had to ask the Secretary of Transportation for
permission to ignore certain federal regulations on the books
relating to aircraft, since these regulations treated a small
drone the same as a Boeing triple 7. An exemption was required
from the requirement to maintain a paper flight manual on board
the aircraft. Another one of the many regulations we requested
exemption from required us to have a fourteen inch registration
number or ``N Number'' on the ``tail'' of our aircraft. Since
our aircraft had no tail, we found this difficult to comply
with.
In late 2014, the first so-called section 333 exemptions
were granted. The industry celebrated this milestone, but the
fine print on the exemption grants made it clear that this was
not the solution we had been waiting for. The exemptions
required two persons for any drone flight, including one person
who held a private pilot's license and a visual observer. The
exemption also restricted flights to at least 500 feet from all
persons and buildings. This was commercially impractical and
failed to acknowledge the advances in autonomous flight
technology.
The many conditions and limitations on the FAA's exemption
authority significantly limited the growth of the small UAS
industry in this country and led many companies to conduct
operations in other countries where regulatory advances have
been made more quickly. For example, drones have been operating
beyond the line of visual sight--a critical element of
commercial operations--in France since 2012. The Japanese
government is racing to implement a regulatory framework to
have drone delivery in place in rural areas by 2018 and in
urban areas in time for the 2020 Tokyo Olympics. Part 107,
provided it is implemented to expand the nature and scope of
operations, will help ensure that the United States does not
continue to cede ground to our global competitors who are
aggressively embracing this rapidly developing technology and
its corresponding economic and consumer benefits.
Part 107 Benefits Both the Commercial Drone Industry and
Consumers
Kespry worked with partners from the Small UAV Coalition to
help the FAA create a rule that put robust safety precautions
in place for small commercial drone operations, while
eliminating many of the categorical restrictions in the
proposed rule that would have been economically impractical
with no material impact on safety. While the rulemaking process
took longer than anticipated, the FAA was receptive to industry
input and expertise; over two-thirds of the recommendations
made by the Small UAV Coalition in response to the Notice of
Proposed Rulemaking (NPRM) were incorporated into the final
rule.
The moment it went into effect on August 29, Part 107 was a
huge improvement over the Section 333 process, a laborious and
lengthy for both industry and the FAA. First, commercial
operators seeking to operate small UAVs no longer need to
petition for FAA approval if they plan to operate within the
scope of the rule. Second, the FAA no longer requires UAS
pilots to have manned aircraft flying experience, which has
little correlation to the skills required to operate a UAS.
Instead, remote pilots must pass an aeronautical knowledge test
to ensure they have the capability and knowledge required to
safely and responsibly operate a drone for commercial purposes.
Operators may fly during daylight and within the visual
line of sight in uncontrolled airspace without obtaining any
additional FAA approvals. Operations can be conducted up to 400
feet above ground level, though a UAV may operate over a
structure up to 400 feet above that structure if it remains
within 400 feet of that structure. These parameters allow
Kespry to conduct many of our operations much more efficiently
than under the Section 333 regime, enabling us to expand our
offerings and widen our customer base.
We hope that Part 107 will allow the FAA to devote more
resources to continued development of a regulatory framework
that will pave the way towards critical components of
widespread commercial drone operations that the final rule
either does not address or permits only under limited
circumstances.
Beyond Part 107
While Part 107 is a solid first step towards a
comprehensive regulatory framework for commercial drone
operations, there are several key components that the FAA must
address expeditiously or United States companies will lose out
to foreign competitors eager to invest in this developing
technology.
Improving the Part 107 Waiver Process
As urged by the Small UAV Coalition, Part 107 allows
operators to seek a waiver from several regulatory limitations,
perhaps most notably to operate at night, directly over people,
and beyond the visual line of sight. These elements are
critical to the successful and widespread integration of
commercial drones into the national airspace that will help
create tens of thousands of jobs. The FAA has already granted
79 waivers, the vast majority of them to allow operations at
night. Time will tell whether the waiver process will be more
efficient and flexible than the section 333 exemption process.
We do not know whether the FAA's staffing and resources are
sufficient to implement the waiver process to support the need
for expanded operations that will save money, save time, and
save lives.
Operations Beyond the Visual Line of Sight and Over People
While we appreciate that Part 107 allows for waivers to
operate beyond the visual line of sight (BVLOS) and over
people, the FAA's next phase of regulations must provide for
even more efficient approval of these types of operations or
the United States will fail to develop the robust commercial
drone industry that other countries are actively pursuing. A
rancher in Nevada or a farmer in North Carolina cannot fully
benefit from drone technology if he must follow his drone in
his truck to maintain the visual line of sight while inspecting
his property.
France, Poland, Sweden, Norway, and the Czech Republic are
just a few of the countries in which beyond visual line of
sight operations have been taking place for years with high
levels of safety. Technology already exists that ensures safe
beyond visual line of sight operations and eliminates the need
for operators to seek waivers on a case by case basis, a
burdensome endeavor for both companies--especially small
businesses--and the FAA.
Congress has also endorsed the need for expanded beyond
visual line of sight operations. FAA reauthorization that
passed the Senate 95-3 earlier this year included language that
expressed the sense of Congress that ``beyond visual line of
sight....operations of UAS have tremendous potential to spur
economic growth and development through innovative applications
of technology and to improve emergency response efforts as it
relates to assessing damage to critical infrastructure such as
roads, bridges, and utilities, including water and power,
ultimately speeding response time.''
Equally as critical to realizing the full potential of
commercial drone applications is the ability to safely operate
UAS over populated areas and people not directly involved in
the operation of the UAS. The FAA has announced its intention
to publish a proposed rule for Operations of Small Unmanned
Aircraft Over People for public comment before the end of the
year. The proposed rule is to be informed by an Aviation
Rulemaking Committee report produced earlier this year by a
task force comprised of FAA, industry and other aviation
stakeholders. The report recommends risk-based performance
based standards, manufacturer compliance requirements, and
operational provisions that we hope to see incorporated into
the proposed rule. We also hope that the proposed rule will
recognize that very light weight, so-called micro UAVs pose the
least risk and therefore can be permitted to operate over
people under certain circumstances without compromising safety.
Risk-Based Regulations: Micro UAS Classification
Industry has been pleased to see the FAA taken an
increasingly risk-based approach to UAS regulations, but it has
yet to acknowledge in regulation the risk differentiation
between very small UAS that weigh only a few pounds or less and
a drone that pushes the 55 pound limit of vehicles subject to
Part 107. A micro UAS classification would create an even more
efficient regulatory framework, further reducing the burden on
small UAS operators without creating any significant safety
concerns.
In the preamble to the proposed rule, the FAA put forth the
idea of a micro UAS classification for vehicles weighing up to
4.4 pounds, including payload, based on concepts put forth in
other countries. Kespry and the Small UAV Coalition endorsed
this idea, the basis for which was the belief by some at the
FAA that a small UAS operation should be given more leeway
where the safety risks of operating such a small vehicle are
negligible. We were disappointed to see that despite receiving
strong support for its micro UAS proposal, the FAA chose not to
include it in the final rule.
Congress has also endorsed the concept of micro UAS
classification. FAA reauthorization bills approved earlier this
year by the Senate and the House Transportation and
Infrastructure Committee both included provisions directing the
FAA to establish a micro UAS category. Unfortunately, this
direction was stalled despite strong, bipartisan support when
the effort to enact comprehensive, long-term FAA
reauthorization legislation was derailed and a short-term
extension of current FAA authorities was enacted in its place.
While we appreciate congressional support for the concept,
industry cannot afford to wait for Congress to again make its
intention clear when it again works to reauthorize the FAA a
full year from now. We urge the FAA to include a micro UAS
classification in its forthcoming Notice of Proposed Rulemaking
for operations over people.
Improving Testing and Training
Early reports from the FAA indicate that the first round of
individuals who have taken the aeronautical knowledge test to
obtain a remote pilot certificate have experienced a high rate
of passage. While this is good news, there is evidence to
suggest that these numbers will decline as more people pursue a
certificate. Many of us in the industry have heard that the
volume of information provided by the FAA to prepare for the
test is not only overwhelming, but also largely focused on
manned aviation, therefore discouraging people from signing up
for the test. It is also a safe assumption that many of those
who signed up to take the aeronautical knowledge test at its
earliest availability are individuals with experience in the
industry who have a strong foundation in the knowledge and
skills required to pass the test. It will take time for
realtors and other professionals who don't have this experience
and awareness, yet stand to benefit enormously from this
technology, to endeavor to take the test and they will likely
not experience the same levels of success.
Further, remote pilot applicants must take the test in
person at a designated FAA testing center. In addition to the
$150 test fee, this is a burdensome and costly deterrent to
compliance. The FAA acknowledged in the preamble to Part 107
that it may authorize online testing in the future if it can be
conducted securely to prevent fraud and cheating. This type of
security technology already exists and is used for testing and
certification in other industries. The FAA should prioritize
standing up an online testing program as soon as possible.
Conclusion
Thank you for holding this hearing and for the opportunity
to testify on behalf of Kespry and the Small UAV Coalition. As
you can see, the commercial drone industry stands to deliver
major economic and consumer benefits that will allow businesses
of all sizes to thrive. Part 107 is a strong and positive first
step in developing a comprehensive regulatory framework for
small commercial drone operations. It is also proof that it is
possible to boost opportunities for American innovation and
manufacturing without being overly prescriptive and hindering
industry's ability to innovate and compete. We look forward to
continuing to work with the FAA and Congress to ensure the
United States develops and implements a comprehensive
regulatory framework that allows for the safe and expedited
integration of drones into the national airspace.
[GRAPHIC] [TIFF OMITTED] T3768.002
Chairman Hardy and members of the subcommittee, thank you
very much for the opportunity to participate in today's hearing
on unmanned aircraft systems. I'm speaking on behalf of the
Association for Unmanned Vehicle Systems International, the
world's largest non-profit organization devoted exclusively to
advancing the unmanned systems and robotics community. AUVSI
has been the voice of unmanned systems for more than 40 years,
and currently we have more than 7,500 members, including many
small businesses that support and supply this innovative
industry.
Unmanned aircraft systems, or UAS, increase human
potential, allowing us to execute dangerous or difficult tasks
safely and efficiently. From inspecting pipelines to surveying
bridges to filming movies, UAS help save time, save money and,
most importantly, save lives. It is no wonder why thousands of
businesses--small and large--have already embraced this
technology, and many more are considering integrating it into
their future operations.
Today, we now have initial regulations governing civil and
commercial UAS operations, which means even more businesses are
cleared for takeoff. While these regulations have only been in
effect for less than a month, there is strong evidence that the
commercial UAS market is poised for significant growth,
particularly among small businesses. Let me explain.
On August 29, the Federal Aviation Administration
implemented the small UAS rule, also known as Part 107. The
rule was the result of years of collaboration between
government and industry that established a flexible, risk-based
approach to regulating UAS. This new regulatory framework helps
reduce many barriers to low-risk civil and commercial UAS
operations. In reducing those barriers, the rule allows
businesses and innovators to harness the tremendous potential
of UAS and unlock the many economic and societal benefits the
technology offers.
Part 107 allows anyone who follows the rules to fly for
commercial purposes. Generally speaking, operators need to fly
under 400 feet, within visual line of sight and only during
daylight hours. However, recognizing the need for the rule to
be flexible, the waiver process under Part 107 allows for
expanded types of operations.
It is clear that businesses are eager to take off. On the
first day the rule went into effect, more than 3,300 people had
already signed up to the take the aeronautical knowledge test,
called the Unmanned Aircraft General (UAG) examination, which
is one of the requirements under Part 107. Of the more than
530,000 people who have registered their UAS with the FAA since
last December, about 20,000 have indicated they are commercial
operators. The FAA expects that more than 600,000 UAS could be
flying for commercial use over the next year.
Until the regulation became effective, individuals and
companies seeking to fly UAS for commercial purposes had to
apply for an exemption under the Section 333 provision of the
FAA Modernization and Reform Act of 2012. The FAA started
granting Section 333 exemptions for certain low-risk commercial
UAS applications in September 2014. From that time until the
day the final rule took effect last month, the FAA granted more
than 5,500 exemptions.
These exemptions provide a window into how the commercial
market is taking shape, the numerous industries embracing UAS
and the most common applications for the technology. AUVSI
analyzed each of the FAA exemptions and found that more than
5,200 businesses received approval to fly for commercial
purposes. Of the businesses that received exemptions, the vast
majority are small. Over 90 percent of these businesses make
less than $1 million in annual revenue and have fewer than 10
employees. Our analysis also found that UAS are being used in
all 50 states for over 40 different types of applications,
including aerial photography, emergency management and utility
inspection.
These exemptions show that a wide number of small
businesses across a range of industry sectors are adopting the
technology. Whether it's aiding search and rescue missions,
advancing scientific research, responding to natural disasters,
or helping farmers care for their crops, UAS are transforming
the way many businesses operate. They also are creating several
new ones--from startups focused on developing new UAS platforms
to entrepreneurs creating new business models that offer
specific UAS services. Other small businesses are eager to use
UAS to improve their existing services and extend their
capabilities.
Let me provide some examples:
One of these businesses is Las Vegas-based
Verascan, Inc., which provides imaging, mapping and
surveying services to Nevada's agriculture, mining,
construction and oil and gas industries. This past
year, it provided aerial survey data to assist in the
construction of the I-11 Highway Boulder City Bypass,
part of a proposed highway link between Phoenix and Las
Vegas.\1\
---------------------------------------------------------------------------
\1\ http://www.verascaninc.com/blogs/blog--detail/29
Another example is North Carolina-based
Flyboy Aerial Photography. It was of the first
professional photography companies in the Triangle
region to use unmanned aircraft. Flyboy was founded by
a husband and wife team. Their passion for photography
and technology has led them to work closely with real
estate agents seeking to show aerial views of property
to potential buyers, as well as assist construction in
surveying and mapping projects more accurately.\2\
---------------------------------------------------------------------------
\2\ http://www.flyboync.com/#!services/cuto
Finally, Cincinnati-based Rise Above Images
provides aerial images for real estate agencies and
construction companies in Ohio. The company helps
attorneys and insurance agencies reconstruct and
analyze the scenes of accidents as well as use aerial
photography to help resolve land disputes.\3\
---------------------------------------------------------------------------
\3\ http://www.riseaboveimages.com/#/home
These are, of course, just a handful of examples of small
business currently using UAS to advance their operations and
---------------------------------------------------------------------------
services. And there are many, many more.
An economic analysis by AUVSI projects that the expansion
of UAS technology will create more than 100,000 jobs and
generate more than $82 billion to the economy in the first
decade following integration in to the national airspace. After
witnessing the growth of the industry over the last few years
and now with Part 107 in place, I am confident those figures
will be even higher.
There is no doubt that this year has been a productive one
for UAS and, as a result, many American businesses are now able
to fly. In addition to the implementation of the small UAS
rule, Congress passed and the president signed an FAA extension
measure which will advance UAS research, expand commercial
operations and enhance the safety of the national airspace for
all users--manned and unmanned.
Notably, the extension calls for the creation of a
comprehensive UAS research and development roadmap to
coordinate industry and government R&D initiatives. The
extension also outlines a pilot program for UAs traffic
management (UTM) and expands the section 333 exemption process
to allow for beyond line of sight operations.
While this measure will provide some short-term stability
through September 2017, it is critical that Congress pass a
long-term bill next year that will set the industry and the
country on a glide path to reap all of the benefits of UAS. The
extension is a good start, but there is still much more work to
be done.
As was recently highlighted at the White House's Office of
Science and Technology Policy and AUVSI Foundation's first-ever
drone workshop, government and industry collaboration is
critical for keeping up with the pace of our industry's
innovations. Key stakeholders in industry and government have
successfully fostered a working relationship that has led to a
more flexible and nimble approach to regulating UAS, while
small businesses have led the charge in adopting the
technology.
AUVSI is eager to continue this critical collaboration with
the Department of Transportation, the FAA, Congress and other
industry stakeholders through initiatives such as the newly-
formed Drone Advisory Committee.
In that same spirit, we are hopeful that the sustained
efforts of all parties will help pave the way for a true,
holistic plan for full UAS integration that includes beyond
line of sight operations, flights over people, access to higher
altitudes and platforms above 55 pounds. Some of these efforts
are already in motion. The FAA is currently reviewing the
recommendations made by the Micro-UAS Aviation Rulemaking
Committee regarding flights over people and a draft rule is
expected by the end of this year.
The UAS industry is primed for incredible growth, thanks to
industry representatives and government regulators nurturing
innovation that helps small businesses be more competitive in
the marketplace than ever before. We hope that these efforts
can be sustained and that we continue to reach new historic
milestones in integrating this technology into the national
airspace.
Thank you, again, for the opportunity to speak today. I
look forward to answering any questions the committee might
have.
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
[all]