The Los Angeles Times reports that Uber, the ridesharing company, plans to extend its reach into the stratosphere by developing an “on-demand air transportation service.”  The plan appears to be that customers will use Uber’s surface transportation ride hailing system to hop a ride to a “vertiport” where an electrically powered aircraft will carry passengers to another vertiport at which they will be met by another phalanx of Uber drivers waiting to take otherwise stranded customers off the roofs of parking garages and into the traffic they supposedly avoided by using the proposed above ground transportation option.  

The purpose appears to be to allow customers to fly from one part of town to another.  Very creative, but shockingly absent all but one off-hand reference to the Federal Aviation Administration (“FAA”), and the federal government’s total dominance over the airspace of the United States, 49 U.S.C. § 40103(a), including the design and construction of airports, which definition includes “vertiports.” 14 C.F.R. § 157.2. 
 
Whether recognized or not, Uber’s scheme faces a host of questions, and potential regulatory objections, that range from the way in which such episodic operations will merge with the arrival and departure paths of conventional aircraft, to the noise of even electric aircraft operating over existing residential neighbors and pedestrians using city streets.  While these are, to a large extent, the same issues posed by the operation of unmanned aircraft, or drones, they are even more immediate in this case, because the proposed electric aircraft are larger, potentially louder, and, perhaps most importantly, impinge on conventional aircraft regulatory areas long controlled by the FAA.


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Today, the Federal Aviation Administration (“FAA”) announced the finalization of its long-awaited Final Rule governing routine commercial operation of unmanned aircraft systems weighing 55 lbs. or less.  The new 14 C.F.R. Part 107 will become effective 60 days from the date of its publication in the Federal Register, which is likely to happen this week or next.

Below is an explanation of how the new Part 107 will affect entities that have already received a Section 333 exemption, followed by a summary of the new operational requirements and restrictions:
 
Section 333 Exemption Holders Get Best of Both Worlds: “Grandfathered” Compliance Status and the Option to Take Advantage of the New Rules
 
In the Final Rule, the FAA was careful to protect Section 333 exempt entities from the burden of complying with an additional layer of regulations.  Instead, Section 333 exemption holders will be “grandfathered” into compliance, as explained by the FAA below:
 
“The FAA clarifies that current section 333 exemptions that apply to small UAS are excluded from part 107. The FAA has already considered each of these individual operations when it considered their section 333 exemption requests and concluded that these operations do not pose a safety or national security risk.
 
The FAA recognizes, however, that there may be certain instances where part 107 is less restrictive than a section 333 exemption. Therefore, under this rule, a section 333 exemption holder may choose to operate in accordance with part 107 instead of operating under the section 333 exemption. This approach will provide section 333 exemption holders time to obtain a remote pilot certificate and transition to part 107. Operations that would not otherwise fall under part 107 may not take advantage of this option. For example, an operation with a section 333 exemption that does not fall under part 107, such as an operation of a UAS weighing more than 55 pounds, would not have the option of operating in accordance with part 107 rather than with its section 333 exemption.
 
Additionally, when section 333 exemptions come up for renewal, the FAA will consider whether renewal is necessary for those exemptions whose operations are within the operational scope of part 107, which also includes those operations that qualify for a waiver under part 107. The purpose of part 107 is to continue the FAA’s process of integrating UAS into the NAS. If a section 333 exemption is within the operational scope of part 107, there may be no need for the agency to renew an exemption under section 333. Because the FAA’s renewal considerations will be tied to the outstanding section 333 exemptions’ expiration dates, a 3-year transition period is not necessary. This will not affect those section 333 exemptions that are outside of the operational scope of part 107 or where a part 107 waiver would not be considered.”  
(Final Rule, Pages 83-84.)
 
Thus, for Section 333 exemption holders, the result is the best of both worlds.  On the one hand, Section 333 exempt entities are not required to modify their current commercial drone operations to comply with the new regulations.  On the other hand, if a Section 333 exempt entity identifies an opportunity to perform certain operations under less stringent restrictions promulgated in the new Part 107, it may “choose to operate in accordance with part 107 instead of operating under the section 333 exemption.”
 
Here is the FAA’s Summary of the new operational limitations, Pilot in Command and certification responsibilities, and aircraft requirements:
 
 


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The Federal Aviation Administration Reauthorization Act of 2016, passed by the United States Senate on April 19, 2016, and previously reported on in this publication, contains another provision that merits comment.  Section 2506, “Airspace Management Advisory Committee” was introduced by Senators McCain and Flake of Arizona, purportedly to provide a communication channel between the Federal Aviation Administration (“FAA”) and the public concerning FAA programs for redesign of regional airspace over major public airports.   

The Senators were apparently motivated by their constituents after the FAA initiated a massive redesign of the airspace over the region surrounding Phoenix International Airport, causing substantial and widespread public outcry regarding perceived altitude changes and associated aircraft noise increases, especially over neighborhoods not previously overflown.  Despite these reported impacts, FAA found that the airspace changes created no significant aircraft noise impacts, and, thus, chose to document their determination with a categorical exemption from review under the National Environmental Policy Act, 42 U.S.C. § 4321, et seq. (“NEPA”).  The City of Phoenix instituted a two-prong approach in disputing this determination.  It first filed a lawsuit to halt the airspace changes, on the ground that, among other things, a categorical exemption is inapplicable where, among other things, there is a division of an established community caused by movement of noise impacts from one area to another, while at the same time utilizing the political approach by submitting section 2506 through Senators McCain and Flake.  
 
Despite its apparently noble purpose, section 2506 doesn’t quite live up to its publicity.
 


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An article of December 23, 2014 in a local East Hampton, New York newspaper, now circulated to a wider audience throughout the nation, gives the impression that, upon expiration of its contractual relationship on January 1, 2015, “East Hampton Town will be free of Federal Aviation Administration oversight and able to set access restrictions at the East Hampton Airport, essentially opening the door for relief from often loud, and sometimes rattling, aircraft noise.”  The article apparently misapprehends, and consequently, vastly overstates the impact of the expiration of the town’s contractual commitments to FAA, in return for funding of airport improvements.  The fact is that, with or without the constraints of such contractual commitments or “grant assurances,” the application of noise and access restrictions will depend entirely upon FAA’s determination concerning the applicability of a parallel set of constraints set forth in the Airport Noise and Capacity Act of 1990, 49 U.S.C. § 47521, et seq. (“ANCA”), which, in turn, will depend on the noise levels of the specific types of aircraft the airport wishes to control or eliminate.  

The newspaper article errs in at least two ways.
 


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In an unexpected turn of events, the Federal Aviation Administration (“FAA”) has denied an application by Los Angeles World Airports (“LAWA”), under 14 C.F.R. Part 161 (“Part 161”), for approval of the nighttime noise mitigation procedure that requires both arrivals and departures to the west and over the Pacific Ocean from 12:00 midnight to 6:00 a.m. (“Application”).  The FAA’s decision was unexpected because the procedure has been in effect on an informal basis for almost 15 years.  LAWA sought FAA approval, pursuant to the requirements of the Airport Noise and Capacity Act of 1990, as amended, 49 U.S.C. § 47521, et seq., (“ANCA”) which requires, among other things, that any restriction on noise or access be approved by FAA or, in the alternative, all the airlines operating at the airport.  In addition, the filing of the Application was required by LAWA’s 2006 settlement with surrounding communities Inglewood, Culver City, El Segundo and the environmental group Alliance for a Regional Solution to Airport Congestion.  

FAA’s denial was based on the Application’s purported noncompliance with three of the six conditions required by ANCA for approval of restrictions on Stage 3, “quieter” aircraft.  These include: (1) the restriction be reasonable, nonarbitrary, and nondiscriminatory; (2) the restriction not create an undue burden on interstate or foreign commerce; (3) the restriction not be inconsistent with maintaining the safe and efficient use of the navigable airspace; (4) the restriction not be in conflict with a law or regulation of the United States; (5) an adequate opportunity be provided for public comment on the restriction; and (6) the restriction not create an undue burden on the national aviation system.  49 U.S.C. § 47524.  
 
FAA’s decision comports with what appears to be its general policy of denying exemptions from ANCA’s stringent restrictions.  


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In a rare showing of unanimity between airport operator and noise impacted community, on September 30, 2014 the Board of Supervisors of Orange County, California (“Board”) approved the extension, for an additional 15 years, of a long-standing set of noise restrictions on the operation of John Wayne Airport (“Airport”), of which the Board is also the operator.  Those restrictions include: (1) limitation on the number of the noisiest aircraft that can operate at the Airport; (2) limitation on the number of passengers that can use the Airport annually; (3) limitation on the number of aircraft loading bridges; and, perhaps most important, (4) limitation on the hours of aircraft operation (10:00 p.m. to 7:00 a.m. on weekdays and 8:00 a.m. on Sundays).   

The restrictions were originally imposed in settlement of a lawsuit in 1986, between the Board, the neighboring City of Newport Beach and two environmental organizations, the Airport Working Group of Orange County, Inc. and Stop Polluting Our Newport.  The obvious question is whether similar restrictions might be achieved at other airports today. The not so obvious answer is that such a resolution is far more difficult now, but not impossible.
 


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The Federal Aviation Administration (“FAA”) has added another arrow to its quiver in its ongoing campaign to limit residential and commercial development in even the remotest vicinity of airports.  In late April, FAA originally published a “Proposal to Consider the Impact of One Engine Inoperative Procedures in Obstruction Evaluation Aeronautical Studies” (“Proposal”) which seeks to supplement existing procedures for analyzing the obstruction impact of new structures or modifications to existing structures on aircraft operations within certain distances around airports (see 14 C.F.R. Part 77), with consideration of the impact of structures on one engine inoperative (“OEI”) emergency procedures.  OEI procedures are not currently included in FAA’s obstruction regulations which advise local land use jurisdictions on appropriate limits to building heights within specified geographic zones around airports to accommodate the takeoff and landing clearance needed by aircraft with their full complement of operating engines.  From an aeronautical perspective, FAA’s initiative sounds desirable and long overdue, even though the occurrence of engine loss is rare.  From the perspective of local jurisdictions, landowners and developers, however, the proposal is anathema, potentially leading to dramatically lower allowable building heights and concomitantly reduced property values, even far from the airport. 


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Predictably, Judge John Walter of the Los Angeles Federal District Court summarily dismissed a lawsuit brought by the City of Santa Monica (“Santa Monica”) aimed at closing the Santa Monica Airport, based on, among other things, unconstitutional taking of property without just compensation.  The court’s decision was made on the procedural grounds that, among other things, the lawsuit was brought too late and in the wrong court.

First, the court found that Santa Monica had brought the suit after the applicable 12 year statute of limitations had expired.  28 U.S.C. § 2409(a)(g).  The court’s rationale was that Santa Monica knew as long ago as 1948 that the Federal Aviation Administration (“FAA”) had a residual claim to the property arising from the Deed of Transfer of the federal government’s lease back to the City of Santa Monica.  That residual claim, therefore, required that Santa Monica’s suit be brought no later than the early 1960s. 

In addition, the court found that, even if a claim for unconstitutional taking could be sustained under the applicable statute of limitations, it was improperly brought in the District Court, as the Tucker Act, 28 U.S.C. § 1491(a)(1) vests exclusive subject matter jurisdiction over monetary claims against the federal government exceeding $10,000 with the Court of Federal Claims.  Santa Monica does not, of course, dispute that the value of the airport property that it wishes to recover and use for other purposes exceeds $10,000. 

Although the court chose the procedural route in making its decision, there appear to be relevant substantive grounds as well.
 


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Spurred on by Congress, FAA has issued a proposed policy revising its current position “concerning through-the-fence access to a federally obligated airport from an adjacent or nearby property, when that property is used as a residence.”  77 Fed.Reg. 44515, Monday, July 30, 2012.  FAA’s current position, set forth in its previously published interim policy of March 18, 2011, 76 Fed.Reg. 15028, prohibited new residential “through-the-fence” access to Federally obligated airports. 

The change came in response to Congress’ passage of the FAA Modernization and Reform Act of 2012 (“FMRA”) on February 14, 2012.  Section 136 of FMRA permits general aviation (“GA”) airports, defined by the statute as “a public airport . . . that does not have commercial service or has scheduled service with less than 2,500 passenger boardings each year,” to extend or enter into residential through-the-fence agreements with property owners, or associations representing property owners, under specified conditions.  77 Fed.Reg. 44516.  Sponsors of commercial service airports, however, are treated quite differently. 


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On Thursday, March 16, 2012, the Environmental Protection Agency (“EPA”) took the almost unprecedented step of publishing in the Federal Register a correction to its prior definition of “regulated new source review pollutant” (“Rule”) contained in two sets of Prevention of Significant Deterioration (“PSD”) regulations, 40 C.F.R. §§ 51.166 and 52.21, and in EPA’s Emissions Offset Interpretative Ruling, 40 C.F.R. Part 51, Appendix S, 77 Fed.Reg. 15,656. The purpose of the revision is to correct an “inadvertent error” dating back to the Rule’s promulgation in 2008 when the then-existing definition was changed to require that particulate matter emissions, both PM10 and PM2.5, representing three separate size ranges of particulates, must include “gaseous emissions, source or activity which condense to form particulate matter at ambient temperatures,” i.e., condensable particulate matter.  See, e.g., 40 C.F.R. § 51.166(b)(49)(vi).  Previously, EPA’s regulations only required the filterable fraction, not the condensable particulate matter, to be considered for new source review purposes.  The 2008 change therefore imposed an unintended new requirement on State and local agencies and the regulated community.


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