FAA Modernization and Reform Act of 2012

In recent months, since the tragic crashes of two Boeing 737-Max aircraft in disparate areas of the globe, both the public and the press have expressed surprise at the finding that the Federal Aviation Administration (“FAA”) was delegating to the aircraft manufacturing industry the principal responsibility for formal certification of aircraft safety. They shouldn’t have been so surprised.

The press consistently blames “agency capture,” the process by which federal agencies purportedly develop cooperative, and even symbiotic, relationships with the industries they are tasked with regulating. In fact, in this instance, it was the United States Congress, in Section 312 of the FAA Modernization and Reform Act of 2012 (“FMRA”), that opened the door to the now questioned delegation of authority over aircraft safety.


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Apparently impatient with the Federal Aviation Administration’s (“FAA”) slow progress in developing rules governing the commercial operation of unmanned aerial vehicles (“UAV” or “drones”), Senators Cory Booker (D-NJ) and John Hoeven (R-ND) introduced in Congress legislation to expedite implementation of rules governing the commercial operation of drones.  

Supported by a host of interest groups, ranging from the Association for Unmanned Vehicle Systems International to the National Association of Broadcasters and Information Technology and Innovation Foundation, the stated purpose of the “Commercial UAS Modernization Act,” S.1314 (“Act”) is to amend the FAA Modernization and Reform Act of 2012 (Pub. L. 112-95), to create an interim rule providing basic guidelines for commercial use and testing of small UAS during the period within which FAA finalizes rules governing the operation of commercial UAS.  The Bill allows any person to “operate a small unmanned aircraft for commercial purposes without an airworthiness certificate within the United States, subject to the requirements under subsection (b) and the operating restrictions under subsection (c) during the period beginning on the date of the enactment of this Act and ending on the effective date of a final rule based on the Notice of Proposed Rulemaking Operation and Certification of Small Unmanned Aircraft Systems (80 Fed. Reg. 9544, February 23, 2015).” The Bill’s general requirements include: (1) liability insurance; (2) registration/certification under section 3(a) of the Act; and (3) the operator’s passing of an “aeronautical knowledge test,” Act, subsection (b)(3)(A), as prescribed by FAA in its February 2015 notice.  
 
The permission granted under the proposed legislation is not without limits, however.  
 


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California legislators are taking advantage of the continuing absence of federal regulation of unmanned aircraft systems (“UAS” or “drones”), and the provisions of the FAA Modernization and Reform Act of 2012, Pub.L. 112-95 (“FMRA”), allowing state and local governments to regulate drone operation in the absence of federal regulation.  Between the start of the new California legislative session, through February 27, 2015, the last day for Bills to be submitted, legislators introduced five Bills.  The most comprehensive of these is AB37, introduced by Assemblymember Campos, and referred to the Assembly Committee of Public Safety, Civil Procedure and Privacy.


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In a landmark decision for film and production companies, the Midwest of the United States, and the unmanned aircraft systems industry, Buchalter Nemer’s Aviation and Aerospace Practice Group made history last week when it secured a Grant of Exemption issued by the Federal Aviation Administration authorizing film and production company Picture Factory, Inc. to operate

On February 15, 2015, the Federal Aviation Administration published its highly anticipated Notice of Proposed Rulemaking (NPRM) on the Operation and Certification of Small Unmanned Aircraft Systems (applicable to UAS weighing 55 lbs. and less).  The proposed rules would add a new Part 107 to Title 14 Code of Federal Regulations to allow for routine civil operation of small UAS in the National Airspace System (NAS).  Although a lengthy comment and revision period is expected to delay finalization of the regulations for another 18-24 months, Section 333 of the FAA Modernization and Reform Act of 2012 will continue to provide a procedure for expedited authorization of commercial small UAS operations in the interim.  The final Part 107 will serve as the foundation for a multi-billion dollar UAS industry in the United States. 


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The Federal Aviation Administration (“FAA”) reports that close calls between conventional aircraft and unmanned aircraft systems (“UAS” or “drones”) have increased during 2014 to more than 40 per month over earlier reports of 10 such incidents in the months of March and April.  Some of these incidents have occurred in the busy airspace surrounding Los Angeles, California, Washington, D.C., and John F. Kennedy Airport in New York.  Some of these conflicts have arisen because untrained operators of recreational drones are unaware of FAA’s guidelines governing such use.  Those guidelines ask, among other things, that “hobby” drones stay away from civil aviation, below 400 feet AGL, and at least 5 miles from airports.  However, as FAA prepares to release its highly anticipated Notice of Proposed Rulemaking for small unmanned aircraft systems, the focus is not on hobbyists, but on commercial operators.


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On June 25, 2014, the Federal Aviation Administration (“FAA”) published in the Federal Register, 79 Fed.Reg. 36172, its “Interpretation of the Special Rule for Model Aircraft” (“Interpretation”) established by Congress in the FAA Modernization and Reform Act of 2012, Pub.L. 112-95, § 336 (“FMRA”).  Despite its name, FAA’s interpretation goes far beyond mere definitional clarification.  It is, instead, the first step in establishing FAA’s preemptive authority over Unmanned Aircraft Systems (“UAS”) as “aircraft” utilizing the National Airspace System (“NAS”), even where the operator of an UAS chooses to denominate it a “model aircraft.” 

As a first step in asserting its regulatory authority, FAA takes the position that Congress’ rule in the FMRA is nothing new, but, instead, relies heavily on the long standing statutory and regulatory definition of model aircraft as “aircraft,” i.e., mechanisms that are “invented, used or designed to navigate or fly in the air,” 49 U.S.C. § 40102; 14 C.F.R. § 1.1.  FAA also applies its own 2007 guidelines regarding UAS operating in the NAS, which recognizes that UAS fall within the statutory and regulatory definition of “aircraft” as “devices that are used or intended to be used for flight in the air with no onboard pilot.”  72 Fed.Reg. 6689 (February 13, 2007). 

FAA’s Interpretation, however, goes far beyond the simple inclusion of “model aircraft” in the category of “aircraft.”  The Interpretation expands even further upon FMRA’s three part test defining a “model aircraft” as an “unmanned aircraft” that is: “(1) capable of sustained flight in the atmosphere; (2) flown within the visual line of sight of the person operating the aircraft; and (3) flown for hobby or recreational purposes.”  FMRA, § 336(d). 
 
With regard to FMRA’s second factor, the requirement that the model aircraft stay within the “visual line of sight” of the user, FAA interprets that requirement consistent with FMRA, § 336(c)(2) to mean that: (1) the aircraft must be visible at all times to the operator; (2) that the operator must use his or her own natural vision (including corrective lenses) and not goggles or other vision enhancing devices; and (3) people other than the operator may not be used to maintain the line of sight.  In other words, to maintain the identity as a “model aircraft,” the aircraft cannot be “remotely controlled” from a location other than that at which it is being flown.

The third factor, the definition of what constitutes “hobby or recreational use” is perhaps the thornier. 
 


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While many members of the growing community of developers, manufacturers and operators of Unmanned Aircraft Systems (“UAS”) have expressed enthusiasm at the National Transportation Safety Board Administrative Decision in the Pirker case, Administrator v. Pirker, NTSB Docket CP-217, July 18, 2013, their reaction should be tempered by the law of unintended consequences.  The outcome of the administrative action, which the Federal Aviation Administration (“FAA”) has since appealed, acknowledges not only the FAA regulation that is certain to arise as a result of the Congressional mandate contained in the FAA Modernization and Reform Act of 2012, Pub. L. 112-95, § 334 (“FMRA”), but also opens the door to unrestricted local regulation. 

Specifically, Pirker’s argument is based on the assumption that the UAS at issue is a “five-pound radio-controlled model airplane constructed of styrofoam [sic],” Motion to Dismiss, p. 1.  He does not cite, or even refer to, any operant statutory or regulatory definition of “model aircraft.”  On that basis, Pirker alleges that his operation of the “model airplane” cannot be regulated because FAA has “fallen far behind its own schedule, as well the scheduled mandated by Congress,” Motion to Dismiss, p. 1, for enacting regulations.  Pirker again fails to refer the Court to the full extent of the Congressional mandate in FMRA which effectively disposes of his fundamental argument. 
 


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As we reported yesterday in our blog titled “FAA Reauthorization Act Exempts Next Generation Airspace Redesign Projects from Environmental Review,” Congress is set to act on the conference version of H.R. 658 (“Act”), a Bill the nominal purpose of which is to fund the Federal Aviation Administration (“FAA”) for 2011-2014, a task Congress has been unable or unwilling to accomplish for the last two years. 

The legislation goes far beyond funding, however.  Toward another stated purpose – to “streamline programs” – the Act sets out the parameters for establishment and operation of FAA’s Next Generation Transportation System (“NextGen”).  Not stopping there, it also “creates efficiencies” by exempting the NextGen program from environmental review under the National Environmental Policy Act, 42 U.S.C. § 4321, et seq. (“NEPA”), Act, § 213.  Thus, whole communities around at least 30 “core” airports might be newly impacted by aircraft overflights seemingly without the opportunity for public review and comment before the NextGen project is implemented, and without an avenue of leverage in the courts afterwards.  All is not yet lost, however.
 


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