BILL ANALYSIS Ó
AB 2724
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Date of Hearing: May 3, 2016
ASSEMBLY COMMITTEE ON PRIVACY AND CONSUMER PROTECTION
Ed Chau, Chair
AB 2724
(Gatto) - As Amended March 17, 2016
SUBJECT: Unmanned aircraft
SUMMARY: Requires unmanned aircraft system (UAS) makers to
provide safety and registration disclosures with the UAS at the
point of sale, requires certain UAS to be outfitted with a
"geofencing" feature, and requires UAS owners to have adequate
liability insurance. Specifically, this bill:
1)Establishes the Drone Registration Omnibus Negligence
Prevention Enactment (DRONE) Act.
2)Defines "unmanned aircraft" as an aircraft that is operated
without the possibility of direct human intervention from
within or on the aircraft;
3)Requires UAS sold in California to include in the product
packaging the following information:
a) A copy of Federal Aviation Administration (FAA) UAS
safety regulations; and
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b) A notice that the UAS must be registered with the FAA,
if the UAS is heavy enough to be required to be registered
with the FAA.
4)Requires a UAS equipped with global positioning satellite
(GPS) mapping capabilities to be equipped with geofencing
technological capabilities that prohibit the UAS from flying
within five miles of an airport.
5)Requires the owner of a UAS to have adequate insurance against
liability, including coverage for potential damages for
personal bodily injuries and death, and for property damage,
resulting from the operation of the UAS.
6)Exempts commercial UAS operators if they are operating under
specific authorization from the FAA.
EXISTING LAW:
1)Vests the FAA with the authority to regulate airspace use,
management and efficiency, air traffic control, safety,
navigational facilities, and aircraft noise. (49 U.S.C. Sec.
40103, 44502, and 44701-44735)
2)Requires, under the FAA Modernization and Reform Act of 2012,
the FAA to safely integrate UAS operation into the national
airspace system by September 30, 2015, and to develop and
implement certification requirements for the operation of UAS
in the national airspace system. (Public Law Number 112-095)
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3)Requires, under FAA rules, as of February 19, 2016, federal
registration of a UAS before first flight outdoors, for any
UAS weighing more than 0.55 pounds (250 grams) and less than
55 pounds (approx. 25 kilos), including payloads such as
on-board cameras, and requires UAS owners to be at least 13
years old to register and to provide name, home address, and
email address. Upon registration, UAS owners receive a
Certificate of Aircraft Registration/Proof of Ownership along
with a unique identification number, which must be marked or
affixed to the UAS. (14 CFR Parts 1, 45, 47, 48, 91, and 375)
FISCAL EFFECT: None. This bill has been keyed nonfiscal by the
Legislative Counsel.
COMMENTS:
1)Purpose of this bill . This bill seeks to reduce the risk of
accidents posed by UAS accidents by requiring UAS product
packaging to include information about federal UAS regulations
and registration, requiring UAS owners to obtain liability
insurance in case of a UAS accident, and requiring UAS with
GPS capability sold in California to contain geofencing
technology to keep UAS from flying within five miles of an
airport. This bill is author-sponsored.
2)Author's statement . According to the author, "If motorists
are required to have license plates and insurance for their
vehicles, drone operators should have the equivalent for their
unmanned, flying objects, so that they can be properly
identified, and owners can be held financially responsible,
whenever injuries, interference, or property damage occurs."
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3)What are UAS? The FAA defines a UAS as an unmanned aircraft
system and all of the associated support equipment, control
stations, data links, telemetry, and communications and
navigation equipment necessary to operate the unmanned
aircraft. More commonly referred to as a drone, a UAS is
flown either by a pilot via a ground control system or
autonomously through use of an on-board computer.
4)Proliferation of recreational UAS and new FAA registration
rules . UAS are widely available to the public. Retail UAS
devices outfitted with cameras now range from roughly $300 to
$1,500. The FAA estimates that nearly one million UAS were
sold during the December 2015 holiday season. In anticipation
of the influx of UAS in the skies, the FAA issued new rules in
2015 requiring any UAS weighing between half a pound and 55
pounds to be registered with the FAA by February 19, 2016.
The new FAA registration rules apply only to "model aircraft,"
i.e., recreational UAS.
According to FAA Commissioner Michael Huerta, who led a March
2016 panel on the future of UAS at the SXSW "South by
Southwest" event in Austin, Texas, the FAA now has more than
400,000 UAS registrants, which surpasses the 320,000 piloted
airplanes currently registered with the FAA. Upon
registration, the FAA issues a unique identifier, which must
be affixed to the UAS in a "readily accessible and visible
manner." The unique identifier can then be used to look up
the UAS owner in the event of an accident, for example.
This bill would require manufacturers who make recreational
UAS for sale in this state to include in the product packaging
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a copy of the FAA safety regulations that apply to UAS and a
notice of the FAA owner registration requirement if the UAS
meets the registration requirements. As noted above, the FAA
currently requires recreational drones between half a pound
and 55 pounds to be registered before they are flown for the
first time.
Unfortunately, UAS registration is not yet widespread. While
the FAA touts that nearly half a million consumers have
registered their UAS, industry data shows nearly one million
recreational UAS were sold during the December 2015 holiday
season alone, which means that less than half of all UAS flown
in the U.S. are currently registered.
The author contends this bill is necessary to ensure that
consumers are aware of their legal obligation to register
their UAS with the FAA before first flight and to help
consumers properly register and operate their UAS safely.
5)The growing number of UAS incidents causing injury and damage .
While California has had no fatal drone accident to date,
less serious accidents are on the rise. In October 2015, 647
residents in West Hollywood went without power after a
hobbyist UAS flew into a power line. In September 2015, a
falling UAS in Pasadena cut and bruised the head of an
11-month old baby in a stroller during an outdoor moving
screening. Also in 2015, during the North Fire in San
Bernardino County, five UAS prevented firefighters from
dispatching helicopters with water buckets for twenty minutes
over a wildfire that leapt onto a Los Angeles-area freeway.
Other incidents include drones falling into the stands at the
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2015 U.S. Open, crashing into a moving car in Canada, and
hitting a toddler in the UK that left the youth blind in one
eye.
Between December 2013 and September 12, 2015, the Center for
the Study of the Drone collected records of 921 incidents
involving drones and manned aircrafts in the national
airspace. 158 incidents were classified as instances in which
a drone came within 200 feet or less of an airplane, 28 of
which required a pilot to maneuver the aircraft to avoid a
collision with a drone. Under federal law, operators are
prohibited from flying above 400 feet or within five miles of
an airport. Most recently, on April 18, 2016, a drone
collided with a British Airways plane as it was coming in for
landing at London's Heathrow Airport - Europe's busiest.
The FAA's Aerospace Forecast report projects that the number
of UAS in the U.S. will increase from 2.5 million in 2016 to 7
million in 2020 (4.3 million hobbyist and 2.7 million
commercial).
6)About geofencing technology . Given the increase in numbers of
UAS and reports of crashes and near misses, the technology is
developing to prevent drones from flying into unauthorized
areas. This technology, known as "geofencing," utilizes GPS
and other technologies to impose geographical limits on drone
movement. By default, a drone will not fly into "geofenced"
areas - it will simply stop and hover at the boundary. The
technology has the potential to prevent drones from flying
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into areas such as airport runways, government properties, and
in the vicinity of natural disasters.
This bill requires recreational UAS sold in California that are
GPS equipped to have geofencing technology that can stop the
UAS from flying within five miles of an airport.
Congress is currently considering legislation that would
impose a number of restrictions on all UAS use, including a
proposed requirement that UAS operators pass an online test, a
requirement that UAS contain certain safety features, and a
new program to fund interception of UAS that fly to close to
airports. At the present moment, however, airports do not
have the technology to intercept UAS that fly too close.
Requiring geofencing technology for GPS-enabled UAS sold in
California would likely pose additional design and licensing
costs for UAS makers. However, California-specific
environmental and safety standards are neither unique nor
insurmountable, as the auto industry meets state-specified
emissions standards in order to sell cars in this state.
7)Liability insurance requirement . AB 2724 requires all owners
of recreational UAS to procure "adequate protection against
liability" to cover damages for personal injury and death and
for property damage that may result from a UAS accident. In
practice, UAS owners would either have to ensure that their
current homeowner's insurance policies would cover a UAS
accident, or obtain supplemental insurance to cover potential
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personal injury and damages that may be caused by operating
their UAS. However, the question of how much protection is
"adequate" remains open.
By way of comparison, California requires all motor vehicles
to have the following minimum level of liability insurance:
$15,000 for injury/death to one person
$30,000 for injury/death to more than one person
$5,000 for damage to property
The author and the Committee may wish to consider whether this
bill should specify minimum insurance coverage amounts so that
UAS operators can be certain as to whether they are
"adequately" insured, as required by the bill.
1)Forthcoming FAA regulation of commercial UAS . In 2012,
Congress passed the FAA Modernization and Reform Act of 2012
which required the FAA to establish a framework for safely
integrating commercial UAS into the national airspace no later
than September 30, 2015, and authorized the FAA to establish
interim requirements for the commercial operation of UAS.
Under the interim rules, UAS operators must meet certain
standards and apply for a commercial use exemption and an FAA
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Certificate of Authorization (COA) in order to operate in in
"navigable airspace," which is generally above 500 feet. In
February 2015, the FAA proposed a new framework for commercial
UAS regulations to allow the use of small UAS in the airspace
from the ground up to 500 feet. If enacted, the proposed
rules would limit flights to non-recreational, daylight uses
and would require a commercial UAS pilot to maintain a visual
line of sight with the UAS.
This bill would exempt from its provisions any UAS flown
pursuant to a COA issued by the FAA. The author and the
Committee may wish to consider whether the bill should be
amended to clarify that the exemption would apply whether the
commercial operator has permission under a COA or under the
forthcoming FAA regulations, which may not require each
commercial operator to obtain a COA to operate. This may be
accomplished as follows:
On page 3, line 25, after "126 Stat. 11, 75-76" insert:
or other commercial operator authorization granted by the
Federal Aviation Administration.
2)The federal preemption issue. Once the FAA has finished
promulgating regulations governing the commercial deployment
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of UAS, which is expected to occur in the next two years, a
future court may find that those federal regulations preempt
certain state laws, or parts thereof - such as this one, if
passed - but much remains uncertain.
For example, in Montalvo v. Spirit Airlines, the Ninth Circuit
held in 2007 that federal law preempts state law aviation
safety standards in areas in which the FAA has issued
"pervasive regulations." In discussing the Montalvo case, the
Ninth Circuit found that the specific FAA regulations relevant
in the case were "pervasive" in that they were "specific,"
detail[ed]," "complete," "thorough" and "comprehensive" and
that this pervasiveness evidenced Congressional intent to
broadly preempt state law. The Montalvo court held that
"federal law occupies the entire field of aviation safety.
Congress' intent to displace state law is implicit in the
pervasiveness of the federal regulations, the dominance of the
federal interest in this area, and the legislative goal of
establishing a single, uniform system of control over air
safety." Montalvo v. Spirit Airlines, 508 F.3d 464, 473 (9th
Cir. 2007)
Two years later, in Martin ex rel. Heckman v. Midwest Express
Holdings, Inc., the Ninth Circuit limited the scope of FAA
preemption and held that state law was only preempted if the
specific area covered by the plaintiff's tort claim was the
subject of pervasive federal regulations. Martin ex rel.
Heckman v. Midwest Express Holdings, Inc. 555 F.3d 806, 811
(9th Cir. 2009) The FAA itself recently took a more concrete
position on the issue of preemption of state UAS regulation.
According to a December 17, 2015, FAA white paper entitled,
"State and Local Regulation of Unmanned Aircraft Systems
(UAS)," the FAA stated that "[l]aws traditionally related to
state and local police power - including land use, zoning,
privacy, trespass, and law enforcement operations - generally
are not subject to federal regulation."
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While the courts will ultimately decide whether certain state
UAS laws are preempted or not, the author and the Committee
may wish to consider whether a severability clause should be
added to this bill in the event that one or more parts are
preempted. This may be accomplished as follows:
On page 3, after line 25, insert:
9595. The provisions of this part are severable. If any
provision of this part or its application is held to be
invalid, that invalidity shall not affect other provisions
or applications that can be given effect without the
invalid provision or application.
3)Arguments in support . According to the author, "The
automobile industry was likely infuriated with the idea of
registration and insurance requirements at the
turn-of-the-century, but the industry survived, and the public
has greater public safety protections in place. As technology
evolves, so must our laws in order to protect our citizenry.
This is a sensible measure that will increase public safety
and encourage responsible drone use in California."
4)Arguments in opposition . The California Chamber of Commerce
and a coalition of insurance industry associations state: "The
evolution of drone technology represents exciting
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opportunities for both businesses and hobbyists. Drones will
be used for a myriad of purposes in the future. Like any
innovation, these devices also offer new and unknown risk
based on how they are used. Insurance will undoubtedly be one
part of managing these risks and, indeed, carriers have
already begun to explore how to best underwrite drones-related
risks to protect the public and policyholders.
"Statutorily requiring insurance for drone usage, however, is
unwise as there is currently insufficient actuarial data to
effectively calculate risk. Insurers must be permitted to
develop the knowledge, experience, products and pricing to
insure drone activities. To adequately insure such risks,
insurers need the freedom to develop products and underwriting
criteria for this new exposure. Without the ability to
accurately underwrite, the cost of drone insurance products
will be unnaturally high, deterring use and access to this
developing technology."
5)Related legislation . AB 2320 (Calderon and Low) prohibits the
operation of UAS in a manner that violates a protective order,
constitutes stalking, interferes with emergency response
personnel, or facilitates delivery of contraband into a jail
or prison; and also prohibits sex offenders from using a UAS
and prohibits local governments from regulating UAS. AB 2320
is pending before the Assembly Appropriations Committee.
SB 868 (Jackson) proposes the State Remote Piloted Aircraft
Act containing numerous provisions regulating the use of UAS.
SB 868 is pending before the Senate Appropriations Committee.
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6)Prior legislation . SB 168 (Gaines) of 2015 would have
increased fines for UAS interference with firefighting
activities and granted civil immunity to public entities,
public employees, and unpaid volunteers, and private entities
acting within the scope of delegated authority, that damage a
UAS in the course of providing a variety of emergency
services. SB 168 was vetoed by Governor Brown.
AB 856 (Calderon), Chapter 521, Statutes of 2015, expanded the
scope of the cause of action in existing law for physical
invasion of privacy by making a person liable for physical
invasion of privacy when the person knowingly enters "into the
airspace" above the land of another person without permission.
REGISTERED SUPPORT / OPPOSITION:
Support
California Association of Highway Patrolmen (CAHP)
Peace Officers Research Association of California (PORAC)
Opposition
American Insurance Association
California Chamber of Commerce
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Consumer Technology Association
Independent Insurance Agents and Brokers of California
National Association of Mutual Insurance Companies
Pacific Association of Domestic Insurance Companies
Personal Insurance Federation of California
Analysis Prepared by:Jennie Bretschneider / P. & C.P. / (916)
319-2200