Building from the Sky Down: New FAA Rules Affect Use of Drones in Construction Industry

Aug 29 2016

By Gregory R. Andre, K&L Gates, Chicago and Thomas R. DeCesar, K&L Gates, Harrisburg

On August 29, 2016, the Federal Aviation Administration’s (FAA) long-awaited final rules regarding the commercial operation of small unmanned aircraft (a.k.a. drones) become effective.[1] The FAA’s new rules, which will primarily be codified under Part 107 of the Federal Aviation Regulations, are a major step for the eventual integration of unmanned aircraft into business operations nationwide. Part 107 represents the FAA’s first comprehensive regulation of unmanned aircraft operations.

Before Part 107, companies had to obtain preapproval through the lengthy Section 333 exemption process (named for Section 333 of the FAA Modernization and Reform Act of 2012) before conducting commercial unmanned aircraft operations. The Section 333 exemption process imposed significant restrictions on unmanned aircraft operations and required operators of unmanned aircraft to have a pilot’s certificate. The new rules, however, generally permit companies to use unmanned aircraft in commercial operations without obtaining preapproval from the FAA and with fewer restrictions than were required under Section 333 exemptions. In addition, the rules create a new class of pilot’s certificate specific to unmanned aircraft that is easier to obtain than a typical pilot’s certificate.

The construction industry will stand to benefit from Part 107, as unmanned aircraft can be employed in a variety of operations helpful to construction companies, including: topographical surveys, access to hard-to-reach locations, job progress tracking, videography/marketing, building and structure inspections, site security, safety, and general construction site troubleshooting. In fact, in an early survey of companies seeking FAA authority to use unmanned aircraft, nearly half of applicants identified the construction industry as a field where they would use their device.[2] This post summarizes the new FAA rules and highlights a few issues of particular importance in the construction industry.

The New Rules – Part 107

Part 107 generally addresses three main areas: (1) the unmanned aircraft; (2) the unmanned aircraft pilot; and (3) operational limitations for unmanned aircraft flights.

The unmanned aircraft:

Part 107 only applies to small unmanned aircraft (i.e., weighing less than 55 lbs.). Unmanned aircraft must be registered with the FAA and properly marked with a registration number.
The pilot in command must conduct a safety inspection of the unmanned aircraft before each flight. However, Part 107 does not require a certificate of airworthiness (as is required for manned aircraft).

The pilot:

The FAA’s rulemaking creates a new category of airman certification for remote pilots in command (“Remote PICs”) specifically for the operation of unmanned aircraft. This differs from the requirements imposed by the FAA through the Section 333 exemption process, in which the agency required unmanned aircraft operators to be certified to fly a manned aircraft.
Individuals seeking a remote pilot certificate must be at least 16 years old and pass an aeronautical knowledge test.[3] Unlike manned aircraft certificates, the FAA will not require flight training or a practical examination in unmanned aircraft flight proficiency.

Operational limitations:

Commercial operation of unmanned aircraft is permitted during daylight and twilight on days with at least three miles visibility.
Unmanned aircraft operations must be conducted within the Remote PIC’s or a visual observer’s unaided line of sight. Although visual observers can be used, they are not required unless the Remote PIC cannot continually observe the unmanned aircraft. Even with a visual observer, the Remote PIC must be close enough to see the unmanned aircraft at any time if needed.
Maximum altitude is 400 feet above the ground, or within 400 feet of a structure, such as a building. Maximum speed is 100 mph.
Operations near structures are now permitted. However, operations over individuals not participating in the flight are prohibited unless specified protective measures are followed.
Operations from moving vehicles or boats (but not aircraft) are permitted in sparsely populated areas.
Flights in Class G airspace (generally airspace away from airports) are allowed without permission, but flights in Classes B, C, D, and E airspace (generally closer to airports or heavily populated areas) require permission from air traffic control.
Remote PICs must report serious incidents to the FAA within 10 days.

Importantly, Part 107 also provides that most obligations under the new rules are waivable upon application to the FAA. Once the agency begins to grant waivers, operators will be able to conduct expanded operations beyond the bounds of Part 107.[4]

Construction industry issues

It is important that companies in the construction industry understand some of the issues that may affect their use of unmanned aircraft. Part 107 will benefit many of these companies by removing several of the restrictions imposed by the FAA in its Section 333 exemption process–helping companies to employ unmanned aircraft in their businesses faster and with fewer constraints. Nonetheless, these new rules still have some significant limitations. In addition, many state and local authorities have addressed the use of unmanned aircraft in their own laws and regulations and placed additional restrictions on unmanned aircraft users. Some of the issues of particular importance to the construction industry under Part 107 and other legal authorities are discussed below.

Operations near structures: One major benefit to the construction industry is that Part 107 now permits companies to operate unmanned aircraft near structures. Section 333 exemptions typically prohibited flights within 500 feet of a structure unless the owner of the structure granted permission to operate closer and the operator conducted a safety assessment. Moreover, in Part 107, the FAA expanded the maximum flight altitude by also allowing flights above 400 feet where they are conducted within 400 feet of a structure. This new allowance could prove valuable to construction companies operating near structures or larger buildings, as these flights may not have been permitted under a Section 333 exemption.

Flights over people: Part 107 prohibits companies from conducting flights over individuals who are not participating in the flight operation (i.e., pretty much everyone except the Remote PIC and visual observers), unless they are protected by structures or stationary vehicles. This limitation may hinder many construction-related operations because companies may be required to clear an active construction site or stop work before flying unmanned aircraft overhead. Alternatively, this prohibition against flying over uninvolved persons, combined with the daylight operation requirement,[5] would limit operations on job sites with uninvolved workers present to between quitting time and sunset on workdays (and between sunrise and sunset on non-workdays). Hopefully this issue will be dealt with by the FAA soon–the agency recently announced plans to issue a proposed rule on operations over uninvolved people this winter.[6] In the meantime, Part 107 makes restrictions regarding flights over uninvolved people subject to possible waiver.

Beyond-line-of-sight operations: In the construction industry, as with many other industries, companies would benefit from the ability to use unmanned aircraft outside the Remote PIC’s line of sight. While the FAA declined to permit these operations in Part 107, the line of sight restrictions imposed by the rules are subject to waiver upon application to the FAA. It is possible that closed-entry construction sites may be one setting in which the FAA is receptive to a waiver application for beyond line of sight flights since the risk of an outside hazard or chance of injury on the ground is reduced. The line-of-sight requirement may present challenges for large or tall buildings or structures or those that span long distances, such as bridges or pipelines, and necessitate either a waiver or additional Remote PICs or visual observers to assist, perhaps in a “daisy chain”.

Insurance: Insurance issues regarding losses stemming from unmanned aircraft are in flux. Some commercial general liability insurers are excluding coverage under the standard aircraft exception. New “drone insurance” policies and policy riders are being offered. All parties to construction projects using unmanned aircraft must confirm that insurance coverage is in place to protect their interests.

Who should hire the unmanned aircraft operator? The answer depends on your perspective. Owners of construction projects will need to determine whether they hire the unmanned aircraft operator directly, require the architect or engineer to hire them, or have the contractor do the hiring. Seeking to avoid liability, presumably most owners will choose to require their contractor to hire the unmanned aircraft operator, obtain insurance for it, and indemnify the owner against any losses arising from it. Owners could have the architect or engineer hire the unmanned aircraft operator, but contractors typically have “deeper pockets” to stand behind the indemnity. Whoever does the hiring should ensure that the unmanned aircraft operator is properly registered with the FAA and has a properly certified pilot. The parties should also address ownership and use of data obtained through the unmanned aircraft operations.

Project location: Preemption issues aside, some state and local laws prohibit or restrict the use of unmanned aircraft in certain areas, such as near airports, schools, hospitals, government buildings, places of worship, parks, or even game lands. In addition, Part 107 has specific rules for operations in some airspace, including areas close to airports. Companies should understand the limitations on their unmanned aircraft operations before flying.

FAA enforcement: The FAA has the authority to impose penalties of up to $11,000 per unmanned aircraft violation. Last year, the agency filed a $1.9 million enforcement action against an unmanned aircraft operator for multiple violations allegedly committed over a two year period. Therefore, compliance with Part 107 and other FAA unmanned aircraft regulations should be taken seriously. Additionally, unmanned aircraft laws may also exist at the state and local level, so compliance at all governmental levels must be ensured.

[1] Operation and Certification of Small Unmanned Aircraft Systems, 81 Fed. Reg. 42063 (June 28, 2016) (to be codified at 14 C.F.R. pts. 21, 43, 61, 91, 101, 107, 119, 133, 183).

[2] AUVSI, Commercial UAS Exemptions: By the Numbers, http://www.auvsi.org/advocacy/exemptions70 (last visited Aug. 23, 2016)

[3] FAA, Becoming a Pilot, https://www.faa.gov/uas/getting_started/fly_for_work_business/becoming_a_pilot/ (last visited Aug. 23, 2016)

[4] FAA, Beyond the Basics, https://www.faa.gov/uas/getting_started/fly_for_work_business/beyond_the_basics/ (last visited Aug. 23, 2016).

[5] Twilight flights are also permitted but require appropriate anti-collision lighting on the unmanned aircraft.

[6] White House, Fact Sheet: New Commitments to Accelerate the Safe Integration of Unmanned Aircraft Systems, https://www.whitehouse.gov/the-press-office/2016/08/02/fact-sheet-new-commitments-accelerate-safe-integration-unmanned-aircraft (Aug. 2, 2016).