FAA failure to regulate U.S. drone boom creates climate of confusion

For the drone industry, the rules of the sky are anything but clear and are becoming cloudier by the day.

The Obama administration is under increasing fire from some in the drone industry who say the federal government — by falling woefully behind schedule in drafting regulations to govern the unmanned craft — has created a climate of confusion that could stifle innovation.

Analysts say the Federal Aviation Administration risks losing the credibility it needs to guide the domestic drone boom, which is expected to radically transform commercial aviation over the next few years.

On a parallel track, small, increasingly cheap drones have become wildly popular for recreation, and it’s unclear how the FAA will regulate operators who want to use the vehicles for that purpose alone.

What is virtually certain, however, is that by the time the FAA releases the necessary regulations, tens of thousands of drones already will be in use.

“Each day [the FAA] waits to do something on this issue, it loses credibility. If there are 1 million recreational drones, there’s no way you’re going to be able to police this stuff,” said C. Dana Hobart, a partner at the Los Angeles-based law firm Hobart Linzer LLP who specializes in aviation law.

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“The more you leave it in this ambiguous or unregulated state, the less the FAA is going to have the authority to speak to the issue and ensure the safety of the skies,” Mr. Hobart said.

While the FAA was given the task of safely integrating drones into U.S. airspace by September, Government Accountability Office reviews have found the agency is roughly on track to release a final rule by late 2016 or early 2017. By the time the rules go into effect, the agency could be as much as two years behind schedule.

Without regulations in place, it remains illegal to fly a drone for commercial purposes, though they drones be used solely for recreation provided operators follow basic safety guidelines, such as keeping the craft under 400 feet, within line of sight and away from airports.

But the FAA has created more confusion by periodically granting “exemptions” to a select few businesses such as movie companies and real estate agents.

On Tuesday, the agency granted another two exemptions, bringing the total number to 13. More than 200 requests for exemptions are pending, and the FAA’s process for choosing which requests to grant is not clear.

With the future in doubt and rules ambiguous at best, frustration has set in within the industry. Some argue that the administration’s delays have hindered progress.

“They are frozen. They are in analysis paralysis,” Dan Ganousis, CEO of Iron Ridge UAS in Longmont, Colorado, told The Denver Post this week. Iron Ridge focuses on drone applications in the agricultural industry.

“They have lost the trust of this market,” Mr. Ganousis said of the FAA and its rule-making efforts.

The FAA on Tuesday declined to comment and instead referred to Dec. 10 congressional testimony given by Peggy Gilligan, the agency’s associate administrator for aviation safety.

In her remarks before a House subcommittee on aviation, Ms. Gilligan said the FAA has made “steady progress” toward integrating drones into the nation’s already crowded airspace, but reiterated that safety, not speed, is the administration’s top goal.

Ms. Gilligan also offered something of an explanation for how the agency determines which companies receive exemptions. First and foremost, she said, the FAA must determine that the company in question will not pose a risk to public safety by operating drones in the national airspace.

The two exemptions granted Tuesday allow a Tucson, Arizona, real estate agency to use a small drone to produce aerial videos of properties for sale and a Spokane, Washington, company to use unmanned craft for crop scouting.

Analysts said the exemption process may be frustrating, but it’s designed to demonstrate to the public — and to lawmakers on Capitol Hill who could restrict the use of drones — that the craft can be used safely.

“It tests the waters and provides some understanding of these systems. Also, from a political standpoint, it helps address some of the concerns in Congress about the ability of U.S. companies to really address this market,” said Philip Finnegan, director of corporate analysis at the Teal Group, a leading aerospace and defense market analysis company. “It’s a way of providing an interim step before you go out and do the final rule. And the final rule is going to take a long time.”

One of the most troublesome issues the FAA must address in its final rule is to outline the differences between using a drone for commercial purposes versus solely for recreation, and then to police drone operators accordingly.

Under current law, for instance, it is technically legal to equip a drone with a camera and snap pictures of a scenic countryside. Selling those pictures, however, is not allowed.

Ironically, that system may have created a situation in which the most responsible operators can’t use drones legally while the most irresponsible can.

“It’s going to be very difficult for the FAA to control this. Part of the problem is there are severe restrictions on the commercial operation of these, and a lot of those people would be the most responsible,” Mr. Finnegan said. “When it comes to hobbyists — no training, dim awareness of the risks — there is very little in terms of limitations. It’s a serious, serious problem.”