Colorado Association of Realtors · Administration. Such prohibited use of unmanned aerial vehicles may lead to the assessment of substantial fines and penalties. The National Association

Colorado Association of Realtors®

Drones in the Real Estate Industry

What You Need to Know

Tom Dougherty Lewis Roca Rothgerber LLP

©2015 LEWIS ROCA ROTHGERBER | Page 2

Overview

1. Introduction to Unmanned Aircraft Systems (UAS)

2. Federal Law and Regulations

3. Real Estate Industry Uses of UAS

4. Legal Issues


Technology

Focus is not on large, military UAS


Technology

Focus is on small, civilian UAS


Terminology

Unmanned Aircraft System (UAS)

Unmanned Aerial Vehicle (UAV)

Unpiloted Aerial Vehicle (UAV)

Remotely Piloted Vehicle (RPV)

Remotely Piloted Aircraft (RPA)

Drone


Why is This Important?

UAS are no longer limited to military and government uses

Wide range of civilian and commercial uses

Advances in UAS technology and sensors

Strong market growth predicted

Regulatory framework is developing to enable expanded use

Legal issues to be addressed


Federal Law and Regulations – Background

UAS are “aircraft” under federal law and regulated by FAA (49 U.S.C. § 40102(a)(6), 14 C.F.R. § 1.1)

Huerta v. Pirker (NTSB Docket No. CP-217, November 18, 2014)

“[N]o person may operate a UAS in the National Airspace System Without specific authority.” “For UAS operating as civil aircraft the authority is special airworthiness certificates.”

(FAA Notice No. 07-01, Policy Statement, “Unmanned Aircraft Operations in the National Airspace System,” February 13, 2007, Docket No. FAA-2006-25714)


Federal Law and Regulations – Model Aircraft

2012 FAA Modernization and Reform Act, Section 336, Special Rule for Model Aircraft

UA is flown strictly for hobby or

recreational use

UA is operated consistent with community-based safety guidelines

UA can weigh no more than 55 pounds unless approved by a community-based organization

UA must give way to manned aircraft

Cannot operate UA within 5 miles of airport without prior notice to airport and control tower

UA must remain below 400 feet

UA must be flown within visual line of sight of the operator at all times


Federal Law and Regulations – Civil Operations

2012 FAA Modernization and Reform Act, Sections 331-333, Unmanned Aircraft Systems

Sec. 332(a)(1)-(3): FAA to develop comprehensive plan “for the safe integration of civil unmanned aircraft systems into the national airspace system as soon as practicable, but not later than September 30, 2015.”

Comprehensive Plan issued September, 2013 https://www.faa.gov/about/office_org/headquarters_offices/agi/reports/media/UAS_Comprehensive_Plan.pdf

Sec. 332(a)(5): FAA to develop a “5-year roadmap for the introduction of civil unmanned aircraft systems into the national airspace system,” and shall update the roadmap annually

First UAS Roadmap issued in 2013 but has not been updated https://www.faa.gov/uas/legislative_programs/uas_roadmap/media/UAS_Roadmap_2013.pdf

Sec. 332(b): FAA to issue final rule to allow civil operations of small UAS within 18 months of Comprehensive Plan however, NPRM cites to Sec. 333 as authority for rulemaking

Sec. 332(c): FAA to establish six UAS test ranges (AK, ND, NV, NY, TX, VA)

Sec. 333: FAA to determine if certain UAS may operate safely in national airspace system before completion of the Comprehensive Plan and rulemaking

https://www.faa.gov/about/office_org/headquarters_offices/agi/reports/media/UAS_Comprehensive_Plan.pdf





https://www.faa.gov/uas/legislative_programs/uas_roadmap/media/UAS_Roadmap_2013.pdf




Federal Law and Regulations – Civil Operations

Special Airworthiness Certificate

Experimental Category: primarily for R&D, crew training, and market survey purposes

Restricted Category: for special purposes or a type certificate for production of a UAS

Section 333 Exemption


Federal Law and Regulations – Section 333 Exemptions

Section 333 grants the Secretary of Transportation the authority to determine whether an airworthiness certificate is necessary for a UAS to operate in the national airspace system.

FAA is using this authority to make case-by-case determinations with respect to specific proposed UAS operations prior to adoption of the final small UAS rules.

Small number of exemptions issued in the first three years following 2012 FMAR

As of May 28, 2015, 479 total exemptions granted

Exemptions granted to companies and individuals in industries including:

agriculture education movie & TV filming electric utilities

oil & gas construction search & rescue insurance

surveying real estate disaster response telecommunications

news media aerial photography mining renewable energy

railroad


Federal Law and Regulations – Section 333 Exemptions

Petitions for Exemption must include:

Name and address of petitioner

Identification of the specific sections of the Federal Aviation Regulations for which an exemption is sought

Description of the relief sought by exemption and why

How the requested exemption will benefit the public as a whole

Explanation of why the exemption would not harm public safety or would provide a level of safety equivalent to the existing rule

Additional supporting information regarding the design and operational characteristics of the specific UAS to be used, UAS operating procedures, qualifications of the personnel that will operate the UAS, the intended UAS operations and operational area

Summary of Exemption request for publication in the Federal Register

Petition should be submitted at least 120 days before intended use


Federal Law and Regulations - Section 333 Exemptions

Exemptions granted under Section 333 will typically address airworthiness certification for the specific UAS identified in the Petition, as well as applicable conditions and limitations on UAS operations.

Most Exemptions have included the following conditions and limitations, among others:

operations are limited to the specific UAS identified

UA, including any payload, must weigh less than 55 pounds

UA may not be operated at a speed exceeding 100 MPH (87 knots)

UA must be operated at an altitude of no more than 400 feet AGL

UA must be operated within the unaided, visual line of sight (VLOS) of the operator at all times

UAS operations must utilize a visual observer who is able to communicate with the operator at all times, and UA must be operated within the unaided VLOS of the operator and visual observer at all times


Federal Law and Regulations – Section 333 Exemptions, cont’d…

UAS operations may not be conducted at

night UAS operations may not be conducted

within 5 nautical miles of an airport If the UA loses communications with the

operator or loses its GPS signal, it must return to a predetermined location

UA must remain clear of manned aircraft

at all times UAS may not be operated from a moving

vehicle

UA operations must remain at least 500 feet from all nonparticipating persons, vessels, vehicles, and structures

All operations must be conducted over

private property or controlled access property

UAS operator must hold an ATP,

commercial, private, recreational, or sport pilot certification, and must hold a current FAA medical certificate or valid US driver’s license


Federal Law and Regulations – Certificate of Waiver or Authorization (COA)

COA is required in addition to Section 333 Exemption; applied for following grant of exemption

COA serves to inform FAA Air Traffic Control facilities of proposed UAS operations and to coordination UAS operations with other airspace uses

COA Application requires information regarding:

name and address of applicant

UAS type, registration, and performance characteristics

the planned UAS operation, operational location, and relevant airspace classification

air traffic communications

procedures to be followed in the event of a loss of UAS communications/control

visual observer responsibilities


Federal Law and Regulations – “Blanket COA”

As of March 23, 2015, FAA will automatically grant a "blanket" COA for flights at or below 200 feet to UAS operators having a Section 333 exemption, provided the aircraft weighs less than 55 pounds, operates during the day only and under Visual Flight Rules (VFR) conditions, within VLOS of the operator, and remains specified distances away from airports or heliports.

If UAS operations outside of “Blanket” COA parameters are intended,

then a separate COA is required.


Federal Law and Regulations – Proposed Small UAS Rules

Published February 23, 2015 – Similar to and builds upon Model Aircraft Rules and Section 333 Exemptions

Major Provisions of Proposed Rules:

May use visual observer but not required

Maximum airspeed of 100 mph (87 knots)

Maximum altitude of 500 feet above ground level

Operator need not be licensed pilot but must be at least 17 years of age and obtain FAA UAS certification

No careless or reckless operations

UA must weigh less than 55 lbs.

UA must remain within VLOS of the operator or visual observer at all times

Operator must be able to see UA with vision unaided by any devices

UA may not operate over any persons not directly involved in the operation

UA may only operate in daylight hours



Overview of proposed rules: https://www.faa.gov/regulations_policies/rulemaking/media/021515_sUAS_Summary.pdf

Complete proposed rules:

https://www.faa.gov/regulations_policies/rulemaking/recently_published/media/212-AJ60_NPRM_2-15-2015_joint_signature.pdf

https://www.faa.gov/regulations_policies/rulemaking/media/021515_sUAS_Summary.pdf



https://www.faa.gov/regulations_policies/rulemaking/recently_published/media/212-

https://www.faa.gov/regulations_policies/rulemaking/recently_published/media/212-








More than 4,500 comments received during public comment period (ended April 24, 2015)

Many comments focused on operational aspects of proposed rules:

VLOS, no autonomous operations, daytime flights only, operator qualifications, etc.

National Association of Realtors® comments

Notice to bystanders

Operator Training

VLOS/BVLOS

communications between operators and visual observer

micro UAS

￭ Final small UAS rules not expected until 2016


UAS in the Real Estate Industry – Ready for Takeoff?

Real estate professionals among the first persons recognizing commercial value of UAS. Early use led to some problems

January, 2012 – warning from LAPD to real estate agents using UAS July, 2014 – FAA subpoenas to NY real estate brokerages believed to

be using UAS


UAS in the Real Estate Industry – Ready for Takeoff?

National Association of Realtors® and numerous real estate professionals have been actively involved in the UAS industry and the FAA regulatory process

Real estate industry has advocated for expedited UAS regulations that allow commercial use safely and affordably while respecting privacy concerns

“The potential of using UAV technology to collect images for use in real estate is also a game-changer for the real estate industry.”

(National Association of Realtors® Letter to FAA Director Michael P. Huerta, September 23, 2014)


UAS in the Real Estate Industry – Benefits

Provide “360o view” of the property

Provide a sense of neighborhood

Provide holistic and detailed view of complex commercial properties

Provide comprehensive information for large undeveloped properties

Cost-effective

Time-saving

Safety


UAS in the Real Estate Industry –NAR Policy Statement

The National Association of REALTORS® advises members that the use of unmanned aerial vehicles for real estate marketing is currently prohibited by the Federal Aviation Administration. Such prohibited use of unmanned aerial vehicles may lead to the assessment of substantial fines and penalties.

The National Association of REALTORS® supports efforts to create new federal regulations to allow for the future commercial use of unmanned aerial vehicle technology by the real estate industry.

The National Association of REALTORS® is committed to working with the Federal Aviation Administration, and any other relevant federal agencies, during the regulatory approval process. The National Association of REALTORS® will continue its ongoing efforts to educate REALTORS® about the current and future regulatory structure for the safe and responsible Operation of unmanned aerial vehicles.

Approved by the NAR Board of Directors November 10, 2014


UAS in the Real Estate Industry – Section 333 Exemptions

Douglas Trudeau, Tierra Antigua Realty, Tucson, AZ

First Real Estate Professional to obtain waiver for commercial UAS operations

As of May 28, 2015, at least 55 Section 333 exemptions granted to UAS users for real estate-related purposes


UAS in the Real Estate Industry – Looking Ahead

“Know Before You Fly” – Safety and Educational Campaign

B4UFLY app

FAA Pathfinder Program

NAR Participation in FAA Beyond Visual Line of Sight Working Group

Final Small UAS Rules

Further Technology Developments

Evolving Federal, State and Local Legislation

Commercial UAS Modernization Act (S.1314)


Legal Issues – Federal Regulations

Fundamental requirement - “[N]o person may operate an aircraft in a careless or reckless manner so as to endanger the life or property of another.” (14 CFR 91.13(a))

Development and implementation of an FAA-compliant UAS program

Open question as to whether and to what extent federal regulations preempt state and local regulation


Legal Issues – State Law

State UAS-related legislation tends to focus on privacy, property rights and law enforcement uses

According to the National Conference of State Legislatures:

As of December, 2014, 49 states have considered UAS-related bills and 21 states have enacted some form of UAS law

In 2015, 44 states considered 148 bills related to UAS


Legal Issues – Colorado

Colorado Legislation

SB15-59, Sen. Newell (law enforcement use)

HB15-1115 (Rep. Lawrence)(initially focused on trespass and harassment, amended to be technology neutral and creates offense of criminal invasion of privacy by use of a device)

Colorado Regulations

CPW Regulation: “It shall be unlawful to use a drone to look for, scout, or detect wildlife as an aid in the hunting or taking of wildlife.”

Local Government Ordinances

Deer Trail, CO: 2014 attempt to authorize drone hunting

Other?


Legal Issues – Airspace and Property Rights

UAS operations present possible issues related to takings, trespass, and nuisance

Generally well-developed body of law with regard to these issues in the context of manned aircraft

Analyses of similar claims related to UAS operations will likely build on these precedents


Legal Issues – Privacy and Data Collection

FAA has stated that privacy issues are beyond the scope of the present small UAS rulemaking

Electronic Privacy Information Center v. FAA, U.S. Dist. Ct. D.C. Cir., Case No. 15-1075 (March 31, 2015)

Presidential Memorandum: Promoting Economic Competitiveness While Safeguarding Privacy, Civil Rights, and Civil Liberties in Domestic Use of Unmanned Aircraft Systems (February 15, 2015)

Directed the National Telecommunications and Information Administration (NTIA) to undertake a multi-stakeholder process “to develop and communicate best practices for privacy, accountability, and transparency issues regarding commercial and private UAS use

Comment period closed April 20, 2015

NAR comments focused on development of best practices related to transparency, accountability, and notice


What You Need to Know

Commercial UAS operations are currently prohibited without FAA approval

Safety of other aircraft and persons is the main priority

Respect the property rights and privacy of other persons

Federal, state and local laws are evolving – stay informed!

Think about insurance

Have a Plan – business purpose and regulatory compliance


Questions?

Feel free to contact me:

Tom Dougherty Lewis Roca Rothgerber LLP [email protected] 303-628-9524

mailto:[email protected]

Documents

Colorado Association of Realtors · Administration. Such prohibited use of unmanned aerial vehicles may lead to the assessment of substantial fines and penalties. The National Association