1

U.S. Department of Transportation

FEDERAL AVIATION ADMINISTRATION

NOTICE OF PROPOSED RULEMAKING REGULATORY 

EVALUATION

Small Unmanned Aircraft Systems

14 CFR Part 107

OFFICE OF AVIATION POLICY AND PLANS

ECONOMIC ANALYSIS DIVISION

George Thurston

February 2015
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TABLE OF CONTENTS

LIST OF ABBREVIATIONS 3

I. EXECUTIVE SUMMARY 4

II. INTRODUCTION/BACKGROUND 7

III. ASSUMPTIONS AND DATA 10

IV. BENEFITS 13

V. COSTS 26

VI. BENEFIT-COST CONCLUSION 63

APPENDIX 64
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LISTS OF ABBREVIATIONS

AC Advisory Circular

AMA Academy of Model Aeronautics 

ARC Aviation Rulemaking Committee 

AUVSI Association for Unmanned Vehicle Systems International

CFI Certificated Flight Instructors

COA Certificate of Waiver or Authorization

DPE Designated Pilot Examiner

FAA Federal Aviation Administration

FSDO Flight Standards District Office

IRS Internal Revenue Service

KTC Knowledge Test Center

NAS National Air Space

NPRM Notice of Proposed Rule Making

P.L. Public Law

PTO Permit to Operate

sUAS Small Unmanned Aircraft System

UAS Unmanned Aircraft System

U.S.C. United States Code

VSL Value of Saved Life
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I. EXECUTIVE SUMMARY

The FAA is proposing to amend its regulations to adopt specific rules to allow the 

operation of small unmanned aircraft system (small UAS) operations in the National Airspace 

System (NAS). These changes would address the operation of small UAS, certification of their 

operators, registration, and display of registration markings. The proposed requirements would 

allow small UAS to operate in the NAS while minimizing the risk they may pose to manned 

aviation operations and the general public. Lastly, the proposed rule would prohibit model 

aircraft from endangering the safety of the NAS. 

If the proposed rule were adopted, operators would be permitted to participate in certain 

non-recreational activities from which they are currently prohibited. The proposed requirements 

are intended to enable the opportunity for the private sector to conduct research and 

development, develop commercial small UAS businesses, and facilitate legal and safe 

operations. Currently commercial activity using a small UAS is prohibited by federal regulation 

unless the civil aircraft has an airworthiness certificate in effect or operations are approved by 

the FAA on a case by case basis via an exemption from the pertinent regulations.1

Due to the proliferation of recreational unmanned aircraft, the technological 

advancements enabling these aircraft to operate commercially, and the societally-beneficial uses 

of non-recreational small UAS operations, the FAA began its small UAS rulemaking in 2005. 

On April 10, 2008, the FAA chartered the small UAS Aviation Rulemaking Committee (ARC) to 

address the incorporation of small UAS in the NAS. On April 1, 2009, the ARC provided the 

FAA with recommendations on how small UAS could be safely integrated in the NAS.2

 

 1 We also note that under the current regulations, even if a small unmanned aircraft has an airworthiness certificate, 

that aircraft’s operator still needs to obtain an exemption from the non-airworthiness regulations, such as the seeand-avoid provisions of § 91.113 in order to operate the aircraft. 2 A copy of the small UAS ARC Report and Recommendations can be found in the docket for this rulemaking.
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On February 1, 2012, Congress gave a statutory direction to the Department of 

Transportation in the “FAA Modernization and Reform Act of 2012” (Public Law 112-95). In 

section 333 of Public Law 112-95, Congress directed the Secretary of Transportation to 

determine whether “certain unmanned aircraft systems may operate safely in the national 

airspace system”. To make this determination under section 333, the Secretary3 must assess 

“which types of unmanned aircraft systems, if any, as a result of their size, weight, speed, 

operational capability, proximity to airports and populated areas, and operation within visual line 

of sight do not create a hazard to users of the national airspace system or the public or pose a 

threat to national security”.

4

 The Secretary must also determine whether airworthiness 

certification is necessary to mitigate the public risk posed by the unmanned aircraft systems that 

are under consideration.5 If the Secretary determines that certain unmanned aircraft systems may 

operate safely in the NAS, then the Secretary must “establish requirements for the safe operation 

of such aircraft systems in the national airspace system.”6

In its initial approach, the FAA utilized a regulatory structure similar to the one that we 

use for manned aircraft. Utilizing this approach, the FAA found several unique issues associated 

with unmanned aircraft that hindered the development of this rulemaking.7 In Appendix 5, the 

FAA discusses several of the alternatives that we considered in developing this NPRM. As a 

result of the ARC meetings, its reports, and the issues from our initial approach, the FAA has 

 3 The primary authority for this rulemaking is based on section 333 of Public Law 112-95 (Feb. 14, 2012). In 

addition, this rulemaking also relies on FAA statutory authorities. Thus, for the purposes of this rulemaking, the 

terms “FAA,” “the agency,” “DOT,” and “the Secretary,” are used synonymously throughout this document. 4 Pub. Law 112-95, § 333(b)(1). 5 Id. § 333(b)(2). 6 Id. § 333(c). 7 Those issues were: (1) different frame of reference for seeing and avoiding other aircraft; and (2) possible loss of 

positive control. Both of these issues are discussed in more detail in the NPRM preamble.
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decided to proceed with the new proposed part 107 by allowing low-risk small UAS operations 

to be incorporated into the NAS.8

Currently non-recreational UAS operations that do not have an airworthiness certificate 

or an FAA exemption are prohibited regardless of where they take place in the United States. 

This proposed rule would allow small UAS that weigh less than 55 pounds, to be operated nonrecreationally in the NAS. This operation would be conducted in accordance with the limitations 

set forth in proposed Part 107.

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The FAA has analyzed the benefits and the costs associated with this proposed rule. The 

estimated out-of-pocket cost for a small UAS operator to be FAA-certified is less than $300. As 

this proposal enables new businesses to be established, the private sector expected benefits 

exceed private sector expected costs when new entrepreneurs enter. As more opportunities 

increase, so will the social benefits. In addition, if the use of a small UAS replaces a dangerous 

non-UAS operation and saves one human life, that alone would result in benefits outweighing 

the expected costs of this proposed rule.

We determined that this proposed rule would: have benefits that would justify its costs;

would potentially have an economic impact of greater than $100 million per year in terms of 

benefits (which might be derived from new small UAS businesses and applications) and thus 

would be an economically “significant regulatory action” as defined in section 3(f) of Executive 

Order 12866; be “significant” as defined in DOT's Regulatory Policies and Procedures; have a 

significant positive economic impact on a substantial number of small entities; may create 

obstacles to international trade and we request comment; and not impose an unfunded mandate 

on state, local, or tribal governments, or on the private sector. 

 8 See NPRM preamble in the docket for more details.

9 See “Operational Scope” section in Preamble for more detail.
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II. INTRODUCTION/BACKGROUND

Due to technological advances, UAS have changed from remotely piloted vehicles with 

limited capabilities to semi and fully autonomous vehicles that could expand and enable new 

potential commercial applications. This proposed rule would allow certain small UAS nonrecreational (e.g. commercial) operations to operate within a regulatory framework by providing 

a safe operating environment for small unmanned aircraft weighing less than 55 pounds (25 

kilograms). This proposed rule also addresses aircraft registration and marking, NAS operations, 

operator certification, the use of visual observers, and operational limits in order to maintain the 

safety of the National Airspace System (NAS).

UAS are called many things, for example, model aircraft, radio-controlled aircraft, 

drones, unmanned aerial vehicles, remotely piloted vehicles, etc. Regardless of what they have 

been called, all small UAS addressed by this proposal have two characteristics in common. The 

first characteristic is small UAS are aircraft that have no onboard pilot/operator. The second 

characteristic is small UAS are remotely operated, either manually by a person using a 

communications link or by a computer using data link communications.

Traditionally, most small UAS were operated recreationally as model aircraft. This 

pattern is changing because small UAS manufacturers are developing more sophisticated aircraft

based to a large extent on drones developed for military and government use. This rulemaking is 

necessary to enable the safe non-recreational operation of these aircraft in the NAS.

The U.S. government also uses unmanned aircraft for military combat, surveillance, and 

reconnaissance. The Department of Defense is consolidating and expanding its efforts to explore 

the potential of UAS technology. In 2010, combined Department of Defense UAS procurement, 
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research and development, operations, and maintenance spending totaled approximately $5.4 

billion.10 The Pentagon currently purchases more UAS than manned fighters and bombers.

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Recently, the commercial industry and the military have also developed drones to be 

operated in special use airspace with FAA approval. Currently, the FAA has granted about 300 

Certificates of Waiver or Authorization (COA) to allow Federal, state, and local governments to 

operate small UAS in the NAS under strictly limited conditions. These COAs must be renewed 

every two years. As these types of small UAS operations are government activities, they would 

not affect the economic analysis of the proposed rule. However, this proposed rule would 

provide public aircraft operations with greater flexibility by giving them the option to declare 

their operation to be a civil operation and comply with the provisions of proposed part 107 

instead of seeking a COA from the FAA. 

Although commercial operations not specifically authorized by the FAA are reported to 

exist today, most of these existing operations do not comply with current requirements to possess

airworthiness certification,12 airman (pilot) certification,13 aircraft registration, and marking 

requirements.

14 These operations also do not meet the NAS operating requirements.15 

Specifically, as discussed in the preamble to the notice of proposed rulemaking (NPRM), these 

operations do not meet the requirement to “see and avoid other aircraft”16 because there is no one 

onboard an unmanned aircraft to exercise this “see and avoid” function.

Therefore, small UAS non-recreational operations are not in compliance with FAA 

federal aviation regulations without an FAA-issued exemption. While commercial small UAS

 10 http://www.militaryaerospace.com/articles/2009/05/unmanned-vehicle-spending-in-the-2010-dod-budget-toreach-54-billion.html 11 http://www.sps-aviation.com/story_issue.asp?Article=1278 12 49 U.S.C. §44711 (a)(1) and 14 CFR part 21 13 14 U.S.C. §44711 (a)(2)(A)) and 14 CFR part 61 14 14 U.S.C. §44101 and 14 CFR parts 45 and 47 respectively 15 14 CFR part 91 16 14 CFR 91.113(b)
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operations are being operated without FAA regulatory approval, the FAA has no method to 

quantify their historical usage. However, as civil applications of UAS develop, a demand for 

legal and safe access to the NAS for commercial and other non-recreational purposes has 

emerged. This proposed rule announces our plan to work with the emerging UAS industry to 

build a safe environment; eventually leading to the inclusion of small UAS into the NAS for 

commercial and other non-recreational purposes as well as satisfying the congressional direction 

from P.L. 112-95. 

Our cost estimates are based on assessments and discussions with the small UAS

Aviation Rulemaking Committee (ARC), industry subject matter experts, and FAA expert 

judgment.

In this analysis, the FAA first discusses general assumptions and data used in our 

estimation of the benefits and costs. Next, we discuss the benefits of this proposed rulemaking. 

We then discuss our estimate of the proposed rule’s potential costs that would be incurred by 

operators of small UAS and the costs incurred by the government. Next, we discuss the 

alternatives to this proposed rule. Lastly, we summarize the estimated benefits and costs for the 

proposed rule. 
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III. ASSUMPTIONS AND DATA

The FAA’s estimated benefits and costs are based on assessments of the small UAS

Aviation Rulemaking Committee (ARC) and the opinions of FAA and industry subject matter 

experts. We remind the reader that since legal operation of commercial small UAS in the NAS 

constitutes a new market, available data for these operations is sparse. The benefit and cost 

analysis for the regulatory evaluation is based on the following factors/assumptions:

• Because the commercial small UAS industry is not yet established and may evolve 

differently from current expectations, the FAA determined that a five-year time frame of 

analysis would be appropriate. 

• The base year is 2013.

• We use a seven percent discount rate for the benefits as prescribed by OMB in Circular 

A-4.17 

• In the small UAS future fleet forecast, the FAA assumes that 20 percent of the fleet 

would retire or leave the fleet every year.18

• Because only one operator is required to operate a small UAS, we assume that there 

would be one qualified FAA-approved operator per registered and operating small UAS.

Even though 20 percent of the small UAS equipment leaves the fleet each year, we 

expect that small UAS operators, once tested and certificated, would remain certificated

 17 http://www.whitehouse.gov/omb/circulars_a004_a-4 18 A copy of the forecast can be found in the rulemaking docket. The FAA notes that a small UAS could incur a cost 

for registration and then retire or leave the fleet during the analysis interval. The FAA also notes that our small 

UAS forecast may be understated if operators choose to own more than one FAA-registered aircraft (for example, as 

a backup in case one aircraft is disabled). To account for this possibility, as a sensitivity analysis, if there were an 

additional 20 percent increase in our small UAS forecast, then the costs in Table 7 and Table 10 would increase by 

20 percent. We request comments, with supporting documentation on this sensitivity analysis.
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operators. Operators would incur a cost for recurrent knowledge testing every 24 

months. 

• The FAA assumes that the failure rate of applicants19 taking the small UAS initial and 

recurrent knowledge based test would be 10% percent.20 However, applicants and 

operators who fail are assumed to pass the knowledge test on the second attempt. 

• Since this proposed rule allows knowledge test centers (KTC) to administer small UAS 

operator initial or recurrent knowledge tests, the FAA assumes that the KTC would 

collocate themselves with a Designated Pilot Examiner (DPE), Certificated Flight 

Instructor (CFI) or Other Designated Authority to validate an applicant's identity, accept 

the knowledge test results and the small UAS operator application for review and 

submission to the FAA AFS-760 Airman Certification Branch for processing.

• The cost to administer an FAA approved small UAS knowledge test, including 

compliance fees, to a small UAS applicant or operator is $150.21 

• The FAA estimates that a small UAS operator applicant would need to travel 19 miles 

one way to reach their closest KTC location.22

• The 2014 published IRS variable cost mileage rate of $0.235 per mile is used to estimate 

the cost of Vehicle usage.

23 

• The FAA assigns the hourly value for personal time to equal $25.09 for Year 1.

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 19 The FAA notes that a person first must apply to become a small UAS operator. During the application process, 

this analysis will refer to a person applying to become a small UAS operator as an applicant. After the applicant has 

successfully passed the application process, this analysis will refer to the person as a small UAS operator.

20 The FAA has not yet created or administered the knowledge test proposed in the NPRM. However, the weighted 

average failure rate for all categories of airman taking knowledge tests in 2013 was 10%. See Appendix 3 for 

details. 

21 http://www.catstest.com/airman-testing-exams/recreational-private-pilot.php 22 See “Travel Expense” section for methodology and source information. 23 http://www.irs.gov/2014-Standard-Mileage-Rates-for-Business,-Medical-and-Moving-Announced
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• The FAA assigns the hourly value for travel time to equal $24.68 for Year 1.

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• The FAA assigns the hourly value of FAA or KTC clerical time to $20.06 by calculating 

the mean for a Level 2 (FG 5/6) Clerical Support person from the Core Compensation 

Plan Pay Bands, effective January 12, 2014 working in the Washington D.C. locality.26 

We then divide the mean of the annual salaries by 2,080 for an hourly rate.

• The FAA assigns the value of $28.00 as the estimate for the FAA’s cost to register an 

aircraft. This estimate is based on an internal cost model developed in September 2014 

by the FAA civil aviation registry to use for managerial estimates.

• The FAA uses a $50 fee to validate the identity of an applicant.

The FAA requests comments, with supporting documentation, on each of these assumptions and 

data values.

 24 Source: Revised Departmental Guidance on The Valuation of Travel time in Economic Analysis (published June 

9, 2014) (Table 3, Local Travel - Personal). Per this guidance, median Household income divided by 2,080 hours is 

used to establish a wage rate. This wage rate, as noted in this guidance, serves as an approximate value for leisure 

time. Consistent with this guidance wage rates are augmented by 1.2 percent per year to reflect projected annual 

growth of real median household income. Year 1 (2012$) wage rates estimates are calculated as 

$24.50*1.0122

=$25.09; Year 2 as $24.50*1.0123=$25.39; Year 3 as $24.50*1.0124=$25.70; Year 4 as 

$24.50*1.0125

=$26.01; and Year 5 as $24.50*1.0126=$26.32. 25 Source: Revised Departmental Guidance on The Valuation of Travel time in Economic Analysis (published June 

9, 2014) (Table 4, Local Travel - Business). Per this guidance future Travel Time Saving estimates are also 

augmented by 1.2 percent per year to reflect projected annual growth of real median household income. Year 1 

(2012$) travel time savings estimates are calculated as $24.10*1.0122

= $24.68; Year 2 as $24.10*1.0123=$24.98; 

Year 3 as $24.10*1.0124

=$25.28; Year 4 as $24.10*1.0125=$25.58; and Year 5 as $24.10*1.0126=$25.89. 26https://my.faa.gov/content/dam/myfaa/org/staffoffices/ahr/program_policies/policy_guidance/hr_policies/hrpm/co

mp/comp_ref/media/core_salary_with_conversion.xls.
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IV. BENEFITS

IV.A. Introduction

This proposed rule would create an enabling business environment which would

encourage the growth of private sector activity in the manufacturing and operating of small UAS. 

Therefore, the major benefit of this proposed rule is that it would enable new non-recreational

aviation activities for small UAS in the NAS where such operations are currently not permitted

without an FAA-issued exemption. The private benefits would exceed the private costs if there 

is only one UAS and that UAS operation earns a profit. 

The FAA’s estimated benefits are based on assessments of the small UAS ARC and the 

opinions of FAA and industry subject matter experts. We remind the reader that since legal 

operation of commercial small UAS in the NAS constitutes a new market, available data for 

these operations is sparse. Accordingly, the FAA has not quantified the aggregate benefits of 

this proposed rule because we cannot reasonably predict how the market will develop for

individual commercial uses of small UAS. 

The proposed rule could provide safety benefits by allowing the substitution of small 

UAS operations for operations that pose a higher level of public risk. In the “Substituting 

Unmanned Aviation Activities for Laborers Working at Heights” section below, we discuss that 

between 2004 and 2012, there were 95 fatalities involving climbers working on cell and other 

towers.27 If the proposed rule would avert only one fatality by using a small UAS instead of a 

tower climber, then the $9.2 million dollar28 cost of an averted fatality would exceed the costs of 

 27 http://www.wirelessestimator.com/generaldoc.cfm?ContentID=9 28 Guidance on Treatment of the Economic Value of a Statistical Life in U.S. Department of Transportation 

Economic Analyses-2014 Adjustment (June 13, 2014), available at 

http://www.dot.gov/sites/dot.gov/files/docs/VSL_Guidance_2014.pdf
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this proposed rule.29 Lastly, a benefit of this proposed rule is the FAA would satisfy 

Congressional direction to allow safe commercial operation of small UAS in the NAS. We now 

discuss these potential benefits and cost savings.

IV.A.1. Benefit Discussion of Enabling New Commercial Small UAS Activities

In March 2013, the Association for Unmanned Vehicle Systems International (AUVSI) 

released “The Economic Impact of Unmanned Aircraft Systems Integration in the United States”

report. The report estimated the economic benefit of UAS integration could create more than 

70,000 jobs in the United States with an economic impact of more than $13.6 billion in the first 

three years of integration and could grow to $82.0 billion by 2025.30 Although small UAS would 

be a fraction of this growth, this proposed rule is the first step to integrating small UAS into the 

NAS that could enable the job and economic growth envisioned by AUVSI. In January 2014, 

AUVSI reported that each day the integration of UAS is delayed would lead to $27 million in 

lost economic impact.31 Although the FAA neither supports nor endorses the AUVSI report, the 

study illustrates the enabling benefits of allowing UAS to operate in the NAS, which would add 

new jobs and potential new markets. We also note that the AUVSI report is based on the 

assumption of an unconstrained airspace, which currently does not exist and also would not exist 

under this proposed rule. We invite comment on how the conclusions of the AUVSI report 

would differ under the current constraints of the NAS and the constraints proposed in this rule.

As no legal commercial small UAS market currently exists, future markets may evolve 

differently from what the FAA expects in our small UAS fleet forecast. According to the 

 29 See Appendix 2 for the value of averted fatalities. 30 http://www.auvsi.org/econreport 31 http://higherlogicdownload.s3.amazonaws.com/AUVSI/958c920a-7f9b-4ad2-9807-

f9a4e95d1ef1/UploadedFiles/1%2027%2014%20Letter%20on%20sUAS%20NPRM%20Delay.pdf
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Unmanned Vehicle University, there are 300 potential markets, many of which could generate 

revenue from small UAS applications and be enabled by this proposal.32 These markets could 

originate from substituting a small UAS for manned aerial operations, tower or bridge climbers,

or by operating in new markets where aviation has never been used. 

In this benefit analysis we explore only four of the many potential small UAS markets 

this proposal could enable. The four potential small UAS markets are:

1. Aerial photography,

2. Precision agriculture,

3. Search and rescue/law enforcement, and 

4. Bridge inspection.

These four examples show that this proposal would not only enable new technologies for 

these markets and other new marketplace opportunities, but utilizing a small UAS in place of a 

manned aircraft would save costs and improve safety. The following analysis investigates the 

potential economic benefits in these four markets that could be realized through the use of small 

UAS. The FAA estimates the potential qualitative benefits based on discussions and the 

opinions of knowledgeable industry experts. 

IV.A.1.a. Aerial Photography

Small UAS industry experts have informed the FAA that a proposed rule could enable a 

viable market for small UAS aerial photography. Current commercial prices for manned aerial 

photography depend on the site location and the nature of the job. Small unmanned UAS can 

 32 http://www.uxvuniversity.com/fluxx/uploads/2013/02/300P.png
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operate much lower and closer to the object being photographed. The FAA and industry experts 

believe that small UAS could become both a viable and less costly substitute for manned aerial 

photography and could also create new sources of demand for aerial photography. These 

unmanned aircraft operators would likely specialize in low-altitude aerial photography and 

video. Consequently, once a small UAS aerial photography market becomes established, it 

would increase safety by substituting an unmanned aviation operation using a very light aircraft

for a more complex manned aviation operation that uses a much heavier aircraft. A heavier 

manned aircraft would pose more risk to the public in the event of an accident. This market 

would also generate significant cost savings to the economy. At this time, however, we are 

unable to estimate the cost savings of using small unmanned aircraft for these types of operations

given that the cost-savings occur by the reduction in cost for existing manned aviation aerial 

photography. The scope and costs of manned aviation aerial photography operations vary 

greatly depending on the location and nature of the operation. The FAA requests information 

and data regarding the expected rate of substitution and cost savings that may result from 

authorizing the use of small UAS for aerial photography operations. 

IV.A.1.b. Precision Agriculture

A second potential market for small UAS this proposal could enable is precision 

agriculture. Precision agriculture uses detailed, site-specific information to manage production 

inputs. Information technologies enable segmenting a farm into smaller units to determine the 

characteristics of each individual segment. For example, the AUVSI cites the explosive growth 

of the use of UAS for agriculture in Japan.33 The UAS being used in Japan to apply pesticides 

and fertilizers are much larger than the small UAS that would be authorized to operate under part 

 33 http://www.pacbiztimes.com/2013/03/22/farms-may-feast-on-drone-technology-test-results/
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107. Although the small UAS this proposal addresses would not be involved in the direct 

application of pesticides and fertilizers, it can be used to monitor applications and yields. Thus, 

given the weight and operational limitations of this proposed rule, current agricultural use of 

UAS in other countries is not indicative of the development of small UAS in the United States.

Manned agricultural aviation is used to provide observations about the state of crops in 

the United States. There are commercial manned aviation businesses that perform aerial imagery 

analysis over various time periods in precision agriculture. These images are then correlated 

with what is happening on the ground. These businesses (along with the individual farm 

manager) analyze the data available from aerial images acquired through manned aviation 

operations, and develop a prescription to vary the inputs based on their analysis. This knowledge 

of the soil and crop characteristics, unique to each section of the field, allows farm managers to 

optimize their production inputs within small portions of the field.

This proposed rule would enable commercial remote-sensing small UAS technology to 

photograph and analyze field images over time. These observations would be made by operators 

using a small UAS platform that has a self-contained digital camera. Low initial investment and 

high potential return could be very attractive to commercial operators who might provide this 

service to farmers. Potential precision small UAS agricultural markets include water 

management, insecticide application management, and nutrient management. The results of the 

analyses provide data to help determine the areas of a farm that might need treatment. More 

efficient use of chemicals saves the farm money, increases productivity, and by using fewer 

chemicals, would have a positive impact on the environment. Once the data are mapped, the 

farmer would employ a custom spray operator to apply the correct amount of chemicals only 

where they are needed. In addition, the spray operator would be able to provide a permanent 
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record to the field manager with GPS data of where and when the treatment took place that 

correlates with small UAS photographs. 

A good agricultural example would be a cotton farm, as cotton farms continually monitor 

and regulate the growth of cotton as well as use harvesting aids. Also, cotton must be defoliated

for it to be harvested and as cotton grows at different rates, aerial images can be used to detect 

those areas with higher growth rates. Variable amounts of defoliant would be used for different 

parts of the field, thereby providing more efficient use of defoliant. The crop conditions may 

include such things as weed patches (type and intensity), insect or fungal infestation (type, 

species and intensity), crop nutrient status, and eroded areas. 

The profitability of precision agriculture varies from area to area and depends on the crop 

that is being produced. Studies have shown that, for granular fertilizer applications on high 

yielding corn, costs can be reduced by $5 to $15 per acre by precision agriculture.34 In 2007 

there were 309,607,601 acres of harvested cropland in the United States and the average farm 

size was 418 acres. 

At only a $5 per acre cost reduction, this proposal could save billions of dollars in 

precision agriculture alone. Utilizing a small UAS to determine granular fertilizer applications 

would not only enable a new commercial opportunity but could also improve safety over using a 

manned aircraft due to the far smaller weight of the small unmanned aircraft.

IV.A.1.c. Search and Rescue/Law Enforcement

A potential third market this proposal would enable includes search and rescue operations 

and disaster relief, as well as law enforcement use. These types of small UAS missions can 

create significant cost savings to federal, state, and local government entities. Industry expects

 34Searcy, Stephen W., (1997). Precision Farming: A New Approach to Crop Management. 
20

that a significant number of public entities will contract the services of a small UAS operator. In 

addition, small UAS can be deployed more quickly than a manned aerial operation, which could 

help in providing disaster relief and assisting in search and rescue operations. These types of 

small UAS missions can create significant cost savings to local government entities who 

currently may be using manned aircraft for these operations, or create new methods of search and 

rescue or law enforcement responses. The FAA and industry expect that some of the larger 

public entities would train their own operators and purchase and operate their own small UAS. 

The majority of the smaller public safety departments that could not afford to train their officers 

to fly a small UAS would contract these services out to commercial small UAS enterprises as the 

need arises. 

The FAA received a separate estimate of the actual monetary savings from using a small 

UAS rather than a manned aircraft from a law enforcement agency. A law enforcement agency 

currently hires a local helicopter service at $650 an hour. This agency has been able to obtain 

Certificate of Authorizations (COA) for some small UAS operations. The agency has informed 

us that these small UAS operations cost approximately $100/hour. Using a small UAS has saved 

the law enforcement agency $550 an hour, which is about an 85 percent savings. For a six 

month period, this law enforcement agency contracted a local operator who flew 10 small UAS 

mission hours with a total savings of $5,500, which would be an $11,000 annual savings for this 

law enforcement agency. It should be noted that most police helicopter missions cannot be 

substituted with a small UAS under the proposed regulations. Nevertheless, if we were to 

extrapolate these cost savings for those operations that can be substituted and to new small UAS 

operations to other law enforcement agencies across the country, this proposal could enhance

search and rescue operations. The FAA requests comments, with supporting documentation on 
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the $650 hourly rate to hire a helicopter service and the potential savings of using a small UAS

by law enforcement agencies.

We recognize that some law enforcement agencies are currently using small UAS under 

COAs and may continue to do so rather than operate under the provisions of part 107. However, 

some public agencies may choose to operate in accordance with proposed part 107 rather than 

continue under a COA. The FAA requests comments on the potential substitution of small UAS 

operations for manned aircraft operations.

IV.A.1.d. Bridge Inspection

The fourth category of potential benefits from the proposed rule would be from using 

small UAS to inspect bridges. The National Bridge Inspection Standards (NBIS) can be found in 

the Code of Federal Regulations, 23 CFR part 650, subpart C. The NBIS sets the national 

standard for the proper safety inspection and evaluation of bridges. Routine inspections are 

performed at 24-month intervals. The routine inspections identify the current structural and 

hydraulic adequacy and condition of the bridge. A report is prepared with repair 

recommendations and recommendations for further analysis or investigation. As summarized in 

Table 1, there were a total of 596,800 bridges in the United States in 2006. 
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Table 1

Number of Bridges in the United States by Owner in 2006

Owner

Number of 

Bridges

Federal 8,355

State 284,668

Local 301,912

Private/railroad 1,490

Unknown/unclassified 375

TOTAL 596,800

To get close enough for an adequate inspection can be difficult, dangerous, and 

expensive. With a 24-month inspection interval, we estimate about 300,000 bridges need to be 

inspected each year. Bridge inspection companies across the United States are interested in the 

potential use of small UAS for bridge inspection. Whether a small UAS could be used for a 

bridge inspection would depend upon the bridge and its environment. Currently, depending on 

the size of the bridge, bridge access equipment (“snoopers”) is sometimes required. A snooper is 

a hydraulic mobile crane that provides reach capabilities for bridge inspections. Industry experts 

from the ARC estimate that the average cost of an inspection using a snooper is $3,250.35 

Cable bridges are much more expensive to inspect because they often require a 200 ft. 

aerial lift to perform a proper inspection. Overall, the industry estimates that roughly 15% of all 

bridge inspections require additional equipment such as snoopers and aerial lifts. The FAA and 

industry believe that this subgroup of the bridge inspection market is especially viable for 

commercial small UAS. Based on the industry estimates, about 45,000 annual bridge inspections 

could utilize some form of small UAS. Industry has informed us that the use of a small UAS 

 35 The FAA believes this industry-provided price may be low because we found prices for bridge inspections that 

were 10 times what industry provided. The costs for bridge inspections included closing down multiple lanes of the 

highway for the snooper, the price of free climbing and repelling inspectors, and other costs such as licensing. We 

request comment, with supporting documentation, on our estimate of the average cost of $3,250 to conduct an 

inspection with a snooper. 
23

would significantly decrease costs of renting a snooper or a manned aircraft. The proposed lineof-sight requirement may hamper substitution between a snooper and a small UAS operation.

Therefore, utilizing a small UAS for bridge inspections could not only enable a new 

commercial opportunity but could also result in cost savings and improve safety over current 

methods of bridge inspection. To the extent that a small UAS substitutes for a snooper, or any 

existing service, the societal savings equals the price of existing service minus small UAS 

service.

IV.B. Safety Benefits

In this section, we describe the potential qualitative safety benefits from allowing small 

UAS to safely operate commercially. This analysis uses anecdotal data to evaluate past 

accidents that may have been prevented had a small UAS been used. The anecdotal safety 

discussion focuses on the potential safety benefits from substituting a small UAS for a manned 

aerial photography activities or tower inspections that can present a hazard to the pilot, the 

climber, or the photographer. Without this proposed rule, non-recreational small UAS operation 

would be categorically prohibited without an FAA exemption.

IV.B.1 Safety Benefits from Aerial Photography Activities

We anticipate small UAS operations could be substituted for manned aviation operations, 

such as some aerial photography. Safety benefits would arise from this proposed rule by 

allowing certain types of unmanned aerial observational operations to replace manned aerial 

photography operations that are currently being conducted under potentially hazardous 

conditions. Not many manned aerial photography activities lend themselves to small UAS use. 
24

For example, aerial photography activities such as those flown for pipeline inspections, highvoltage power line inspections, commercial photographers covering action events, and wildlife 

observation of birds and other animals would not be practical by the proposed rule due to the 

proposed line-of-sight requirements. However, small UAS could be used in photography 

operations such as photographing real estate, commercial buildings, certain towers, bridges, or 

parks. 

In determining the potential hazard for manned aerial aviation photography, the FAA 

reviewed 17 aerial aviation photography accidents and incidents that occurred between 2005 and 

2009.

36 Of these accidents, the FAA determined that a small UAS could have substituted for the 

manned operation in the following two cases. 

NTSB Accident Investigation Number: WPR09LA160: 3/20/2009

The helicopter pilot was circling over a residential structure to allow his passenger to take 

photographs. He failed to maintain adequate rotor rpm while maneuvering at a low 

altitude and crashed the helicopter resulting in no fatalities and no injuries. The hull 

sustained “substantial damage.” 37 

NTSB Accident Investigation Number: MIA07CA004: 10/11/2006

The helicopter pilot maneuvered the helicopter so that the photographer could take photos 

of a house at the water’s edge. He lost control during a crosswind and crashed into the 

water resulting in no fatalities and no injuries. The hull was destroyed.38 

These photography activities could have ended in fatalities and could have been 

performed by a small UAS rather than by a manned helicopter. As small UAS technological 

capabilities advance, small UAS could be substituted for other types of commercial aviation 

 36 See Appendix 1. 37 The “Aircraft Bluebook Price Digest” reports that the damaged rotorcraft is valued at between $47,000 to 

$285,000 and was built between 1979 to 2012.

38 The “Aircraft Bluebook Price Digest” has no data on the destroyed rotorcraft.
25

activities as well as in public safety operations. The FAA anticipates that when this rule 

becomes effective, small UAS would be substituted for a few manned aviation operations, 

thereby reducing the potential for aviation accidents with fatalities, injuries and property damage.

IV.B.2. Substituting Unmanned Aviation Activities for Laborers Working at Heights

The FAA and industry believes that small UAS could be substituted for certain activities 

now requiring the use of climbers. The proposal would also allow certain types of unmanned 

aerial observation operations to replace laborers working on high towers or certain other 

hazardous locations. Climbers working on cell, TV, microwave, radio, government 

communications towers, and bridges have a fatality rate that is approximately 10 times that of 

construction workers.39 

Between 2004 and 2012, there were 95 fatalities involving climbers working on cell and 

other towers.40 One example of such an accident occurred in 2008, in Southwest Indiana, 

involving a tower climber who was photographing antennas on a cell tower that were to be 

replaced when the cell network was upgraded. The climber’s safety equipment failed and he 

died in a 150 foot fall. A small UAS may have performed that photography, thereby creating a 

safety benefit by substituting an unmanned aerial operation for the climber.41 Although many 

tower climbing falls occur during actual construction activities, for which a small UAS could not 

be used, falls occurring during tower inspections that could use a small UAS may be reduced.

 39 http://www.propublica.org/article/cell-tower-fatalities 40 http://www.wirelessestimator.com/generaldoc.cfm?ContentID=9 41Public Broadcasting Service, Frontline, May 22, 2012. www.pbs.org/wgbh/pages/frontline/cell-tower-deaths. 
26

IV.C. Benefit Summary

The Unmanned Vehicle University has identified hundreds of possible small UAS

markets that could be enabled as a result of the proposed rule. We provided more detailed 

discussion for four potential markets. For any commercial operation occurring as a result of this 

rule, the operator or owner of the small UAS will have determined the expected revenue stream 

of the flights exceeds the cost of the flights operation. In each such case, this rule helps enable 

new markets to develop. Lastly, we identified how the proposed rule could improve the safety of 

the NAS when small UAS are operated in place of a manned operation or a laborer working at 

heights. If this proposed rule would avert only one fatality by using a small UAS instead of a 

tower climber then the $9.2 million dollar benefit of an averted fatality would exceed the costs of 

this proposed rule. 

To help further define markets and costs savings that are discussed generally in this 

aggregate benefit estimate for small UAS operations, the FAA requests comments on the 

analysis, supported by data and documentation.
27

V. COSTS

V.A. Introduction

Although it is difficult to estimate the potential costs of this proposed rulemaking because 

many of the proposed requirements rely on market forces for a market that does not yet exist, our 

cost estimates are based on assessments of the small UAS ARC, industry subject matter experts, 

and FAA expert judgment.

Most of the compliance costs for the proposed rule would occur in the application process

for a small UAS operator. During the application process, we expect that an applicant would 

have to drive to a Knowledge Test Center (KTC) to take a FAA-approved knowledge test, pay a 

fee to take an aeronautical knowledge test, and then pay a fee to obtain positive identification 

verification from a Designated Pilot Examiner (DPE), Certificated Flight Instructor (CFI), or 

other designated authority at the KTC. We assume that the failure rate of applicants taking the 

knowledge test is 10 percent; therefore, where applicable, total costs will increase by 10% for

applicants who apply to become FAA-approved small UAS operators. The proposed rule would 

also require the owner of a small UAS to pay a registration fee for the aircraft. The application 

process would impose paperwork costs for the time it takes to fill out the proposed positive 

identification verification form, the aeronautical knowledge test, the physical capability form, the 

knowledge test application, and the small UAS registration form. After the application process, 

the proposed rule could also add paperwork costs for the time to fill out the change of address, or 

name forms, or accident-reporting forms. 

Lastly, the Transportation Security Administration (TSA) would incur costs for a security 

threat determination and the FAA for processing small UAS certifications to the small UAS 

operators.
28

In order to estimate the costs of this proposed rule, we first discuss the FAA small UAS 

fleet forecast. Using the FAA small UAS fleet forecast, we then develop the number of small 

UAS operators and applicants who would become small UAS operators. Next, we discuss the 

estimated costs for compliance to the proposed rule as just identified. We conclude with a 

discussion on the special rule Congress issued for model aircraft.

This analysis will distinguish the difference between the operator costs relative to the 

registration of their small UAS and the operator costs relative to their testing requirements, 

travel, positive identification, TSA vetting, and paperwork. The FAA notes the development of 

the number of aircraft and operators relative to each of the cost categories are different and 

explain our forecast and estimated number of operators and small UAS aircraft that pertain to 

each section in the discussions below.

The FAA requests comments, with supporting documentation, on the cost estimates and 

forecasts presented in the following sections.

V.B Small UAS Fleet Forecast

The small UAS fleet forecast is based upon the constraints of the regulatory and airspace

requirements. Once small UAS operations are conducted within the proposed regulatory 

framework and in commercial markets, we anticipate a surge in the application of the aircraft’s 

services. Due to safety considerations over the use of a small UAS, operators would most likely 

develop new non-recreational applications. When this rule becomes effective, the preferences of 

operators will be revealed by their decisions, but until then the resulting fleet and markets must 

be based on expert judgment.

In addition to the AUVSI forecast discussed above, the FAA is aware of other UAS 

projections such as the proprietary “World Unmanned Aerial Vehicle Systems; 2014 Market 
29

Profile and Forecast” conducted by the Teal Group Corporation. These forecasts generally 

assume growth, but none of them have the insight of knowing what we are proposing as a 

regulatory scheme. In light of the requirements proposed in this rulemaking, the FAA invites 

commenters to provide data to help inform the forecasting in the final rule. 

The FAA small UAS fleet projection covers only those potential legal commercial 

activities that use small UAS weighing less than 55 lbs (25 kgs). The FAA estimates that 

approximately 7,550 commercial small UAS would be operating at the end of five years after the 

effective date of the final rule.

42 Industry experts from the ARC estimated that there could be up 

to 39 separate manufacturers and about 200 different small UAS designs that will make up the 

affected future fleet. The industry estimated the total applications based upon the sum across 

individual markets thought viable with a legal framework in place. 

As seen in Table 2, the FAA and industry experts anticipate there will be an initial surge 

in applications to operate about 3,200 small UAS annually during each of the first 3 years after 

the final rule becomes effective. While the markets could absorb a quicker surge of new 

applications, the newness of the commercial opportunity and the lack of infrastructure were 

thought to spread the demand over the first three years. The FAA and industry experts also 

expect that 20 percent of the net fleet would retire or leave after the first year.

43 The FAA and 

industry experts anticipate that in Year 4 and Year 5, new commercial small UAS entering the 

fleet would decrease to about 1,400 per year. Thus, as seen in Table 2, the FAA projects that 

approximately 7,550 commercial small UAS would be operational after five years. The future 

 42 http://www.faa.gov/about/office_org/headquarters_offices/apl/aviation_forecasts/aerospace_forecasts/2014-

2034/media/Unmanned_Aircraft_Systems.pdf 43 We note that the Small Business Administration (SBA) reports new firms with employees tend to have an annual 

failure rate of 10 to 12 percent where new firms without employees have failure rates about 30 to 36 percent. As 

this is an entirely new industry, the failure rate may be towards the higher end of the range. We find that the FAA’s 

forecast of 20 percent is consistent with the SBA’s failure rate of new business. 

http://www.sba.gov/sites/default/files/FAQ_Sept_2012.pdf
30

fleet depends on the regulatory structure finally adopted, technology, and the cost structure of the 

industry as it evolves.44

The FAA requests comment, with supporting documentation on the five year small UAS 

fleet forecast. We request information about the number of manufacturers and models, 

production plans, and information about the range of businesses and markets these new 

commercial small UAS may serve. We remind commenters that proprietary or confidential 

business information should not be filed in the docket. Additional information on how to submit 

such information is contained in the “Additional Information” section of the preamble to the 

NPRM.

Table 2

Small UAS Commercial Fleet Forecast

New Small Small UAS Cumulative 

Year UAS Fleet Leaving Fleet Fleet 

1 3,236 - 3,236

2 3,236 647 5,825

3 3,236 1165 7,896

4 1,387 1579 7,704

5 1,387 1541 7,550

* Details may not add to row or column totals due to rounding.

The fleet forecast in Table 2 will be used below to estimate the costs of small UAS 

registration and their associated fees. In the “Number of Small UAS Operators” section below, 

we will use the small UAS fleet forecast as a basis to estimate the number of small UAS 

operators and the costs relative to their testing requirements, travel, positive identification, TSA 

vetting, and paperwork.

The FAA realizes that some manned aircraft flights could be displaced by a small UAS; 

however, we expect such substitution would be small because of the proposed operating 

 44 Ibid
31

limitations on small UAS applications. We request comments, with supporting documentation,

on how small UAS could displace manned aircraft flight.

The FAA notes that since the benefits of this proposed rule are enabling those who 

choose to purchase a small UAS as a new business opportunity, if the fleet increases above our 

forecast, the benefits and costs would increase proportionately. Conversely, if the fleet decreases 

below our forecast, the benefits and costs would decrease proportionately. As an enabling rule, 

the private sector benefits would exceed costs when the private sector first commercial 

operations occur as that entrepreneur has decided his expected revenue will exceed his costs.

V.C. Number of small UAS Operators and Applicants

Proposed §§ 107.13(a) and 107.61(c) would require an applicant to pass an aeronautical 

knowledge test to obtain an unmanned aircraft operator certificate with a small UAS rating from 

the FAA before operating a small UAS. In order to maintain operator certification, the FAA 

proposes to require that applicants for this certificate demonstrate their aeronautical knowledge 

by passing an initial written test and a recurrent test every 24 months thereafter. The choice of 

an interval for retesting involves a tradeoff between the cost of retesting and the potential that 

either the operators may forget some information in the interim if they do not regularly use the 

information or the information may be updated. In the case of manned aircraft, pilots must be 

retested every two years. On the other hand, many states do not require drivers to take recurrent 

knowledge tests. FAA seeks data from commenters to assist with the assessing the appropriate 

period of time between tests. 

Under the FAA’s proposal, unless a small UAS operator leaves for other opportunities, 

an applicant would have to take an initial knowledge test in Year 1 to become a small UAS 

operator and then take a recurrent test in Year 3. Similarly, applicants in Year 2 would have to 
32

take an initial knowledge test to become a small UAS operator and then take a recurrent test in 

Year 4, and applicants in Year 3 would have to take an initial knowledge test to become a small 

UAS operator and then take a recurrent test in Year 5. Thus, for two years after passing their 

initial or recurrent knowledge test, small UAS operators would not incur any additional cost in 

order to maintain their certification under this proposed rule.

In order to estimate the potential compliance cost that would result from proposed §§ 

107.13(a) and 107.61(c), we estimate the number of operators based on our small UAS fleet 

forecast from Table 2. The estimate of the number of small UAS operators calculated in this 

section will also be used below to estimate costs for travel, positive identification, TSA vetting, 

and paperwork.

To keep the analysis simple, the FAA assumes there would be one qualified operator per 

small UAS. We further assume that the failure rate of applicants taking the aeronautical 

knowledge test is 10 percent, but they then pass the knowledge test on the second attempt. Even

though 20 percent of the small UAS equipment leaves the fleet, in Year 1 through Year 3, we 

expect that operators once tested and certificated would remain employable and some would take 

jobs as small UAS operators in the following years of the analysis interval. 

A person first must apply to become a small UAS operator. During the application 

process, this analysis will refer to a person applying to become a small UAS operator as an 

applicant. After the applicant has successfully passed the application process, this analysis will 

refer to the person as a small UAS operator.

As the fleet increases in Year 1 through Year 3, the number of small UAS operators 

would also increase. As shown in Table 2, when the cumulative fleet starts to decline in Year 4, 

operators would start leaving the market place for other opportunities. These operators could 
33

find opportunity in later years of the analysis interval by either re-entering the market on their 

own or finding employment with a company that owns small UAS aircraft. 

In estimating the total costs for this proposal, we now develop the methodology to 

estimate the number of applicants and operators who would require initial and recurrent 

knowledge testing, travel, positive identification, TSA vetting, and paperwork. 

For Year 1, every applicant shown in the “Cumulative Fleet” column from Table 2 would 

need initial knowledge testing (3,236). For Year 2, we calculate the number of new small UAS 

applicants that need initial knowledge testing by subtracting the total fleet (from Table 2)

operating in Year 2 from the total fleet operating in Year 1 (5,825 – 3,236). Similarly for Year 3, 

we calculated the number of new applicants needing initial testing by subtracting the total fleet 

operating in Year 3 (from Table 2) from the total fleet operating in Year 2 (7,896 – 5,825). Since 

a small UAS operator must pass a recurrent test every 24 months, every operator operating a 

small UAS in Year 1 would also need recurrent knowledge testing in Year 3. Therefore, the total 

number of small UAS applicants and operators who would need either initial or recurrent testing 

in Year 3 would be 5,307 (2,071 + 3,236). For Year 4, Table 2 shows the cumulative fleet starts 

to decline; therefore 192 (7,704 – 7,896) operators would leave for other opportunities. Also, for 

Year 4, the number of operators who would require recurrent testing would be the number of 

operators in Year 2 minus the number of operators who left for other opportunities (2,589 – 192). 

Likewise, 154 (7,550-7,704 from Table 2) operators would also leave in Year 5. The number of 

operators who would require recurrent testing in Year 5 would be the number of operators in 

Year 3 minus the number of operators who left (2,071 – 154).

The “Total who Incur Costs” column from Table 3 shows the FAA estimate of the total 

number of small UAS operators and applicants who would incur costs from this proposal’s 
34

requirements for initial and recurrent knowledge testing, travel, and paperwork. We note that 

only applicants would incur costs from positive identification and TSA vetting because once the 

applicant has been identified and vetted, they do not need to repeat the process.

Table 3

Number of Small UAS Operators or Applicants Who Incur Costs

Cumulative Number of sUAS Applicants or Operators

Year Fleet

Initial

Applicants

Recurrent

Operators

Total who 

Incur Costs

1 3,236 3,236 - 3,236

2 5,825 2,589 - 2,589

3 7,896 2,071 3,236 5,307

4 7,704 -192 2,397 2,397

5 7,550 -154 1,917 1,917

* Details may not add to row or column totals due to rounding.

V.D. Small UAS Applicant, Operator, and Owner Costs

The following section discusses the fees to applicants who become operators of small 

UAS and the owners of small UAS aircraft. 

V.D.1. Travel Expense

As stated in the “Assumption and Data” section, the FAA assumes that a KTC would 

offer the service to administer a small UAS knowledge exam to either an applicant taking an 

initial knowledge test or a small UAS operator taking a recurrent knowledge test. The applicant 

(or small UAS operators in the case of recurrent knowledge tests) would then visit a DPE, CFI,

or other designated authority aligned with the KTC office, and that person would then accept the 

application and verify the identity of the applicant. Therefore, the FAA estimates that there 

would be a travel cost to the applicant for driving to a KTC.

45

 45 The FAA notes that although the KTC cannot accept a UAS operator airman certificate application, as stated in 

the “Assumptions and Data” chapter, there would be ACR, CFI, and DPEs at the same facility that can accept the 
35

The FAA used zip code information for student pilots from the FAA’s Airmen 

Certification Database to estimate the small UAS applicant population who would travel to a 

KTC. The student pilot zip codes, with the KTC zip codes, were used with zip code matching 

software that takes two lists of locations then sorts and calculates the geographic distance from 

one another. The FAA then calculated a weighted average to estimate the average distance for 

an applicant to travel to reach the closest KTC. On average, the FAA calculated that a small 

UAS operator or applicant would need to travel 19 miles one way (or 38 miles round trip) to 

reach their closest KTC location. The FAA seeks comment on whether UAS operators are likely 

to have the same geographic distribution as student pilots. 

The FAA estimates that this rulemaking would add mileage costs to each small UAS 

operator or applicant, shown in the “Total who Incur Costs” column from Table 3, to drive to a 

KTC to complete the initial or recurrent knowledge based test. To estimate these travel costs, we 

multiply the number of small UAS operators and applicants from Table 3 by the mileage rate 

from the “Assumptions and Data” section and then by the number of round trip miles to travel to 

and from the KTC location and then by 10 percent to account for the failure rate. 

Table 4 shows these calculations and the proposed rule’s total estimated mileage cost 

over the five year analysis interval.

 

airman certificate application after the person passes the knowledge test. However, the proposed rule would not 

limit positive identification services to only the ACRs, CFIs, and DPEs that are co-located at KTCs.
36

Table 4

Small UAS Operators and Applicants Travel Expense

(Thousands of Current Dollars)

Total who Incur 

Costs Mileage Number of Application Total Costs

7 % Present 

Value

Year From Table 3 Rate Round Trip Miles

Failure 

Rate (000) (000)

1 3,236 $0.235 38 1.1 $31.8 $29.7

2 2,589 $0.235 38 1.1 $25.4 $22.2

3 5,307 $0.235 38 1.1 $52.1 $42.6

4 2,397 $0.235 38 1.1 $23.5 $18.0

5 1,917 $0.235 38 1.1 $18.8 $13.4

Total $151.7 $125.9

* Details may not add to row or column totals due to rounding.

V.D.2. Knowledge Test Fees

Under the proposed rule, the person who manipulates the flight controls of a small UAS 

would be defined as an “operator.” Proposed § 107.61 would require an applicant to pass an 

initial aeronautical knowledge test and obtain an unmanned aircraft operator certificate with a 

small UAS rating from the FAA before legally operating a small UAS in the NAS for nonrecreational purposes. In order to maintain his or her small UAS operator certification, the FAA 

proposes to require that applicants demonstrate their aeronautical knowledge by passing a 

recurrent test every 24 months thereafter. 

The proposed rule would require an applicant to demonstrate knowledge of the following 

information to pass an initial aeronautical knowledge written test:

• applicable regulations relating to small unmanned aircraft system rating privileges, 

limitations, and flight operation;

• airspace classification and operating requirements, obstacle clearance requirements, and 

flight restrictions affecting small unmanned aircraft operation;
37

• effects of weather on small unmanned aircraft performance;

• small unmanned aircraft system configuration management;

• emergency procedures;

• crew resource management;

• radio communication procedures;

• determining the performance of small unmanned aircraft;

• physiological effects of drugs and alcohol;

• aeronautical decision-making and judgment; and

• airport operations.

The recurrent test covers less areas of knowledge than the initial test. The specific areas 

of knowledge required for the recurrent test for a small UAS operator are:

• applicable regulations relating to small unmanned aircraft system rating privileges, 

limitations, and flight operation;

• airspace classification and operating requirements, obstacle clearance requirements, and 

flight restrictions affecting small unmanned aircraft operation;

• sources of weather;

• emergency procedures;

• crew resource management;

• aeronautical decision-making and judgment; and

• airport operations.
38

Currently the FAA Regulations and the “Aeronautical Information Manual” contain 80

percent of the information that a small UAS operator or applicant would need to pass a 

knowledge test.46 The other 20 percent would be found in Advisory Circulars (AC) and online 

FAA website material. The FAA assures that by the time this rule is published, all the 

information necessary for an applicant to obtain a small UAS operator certificate would be 

available online. 

The FAA anticipates that it will not need to develop new original content for most of the 

areas of knowledge that would be tested on either the initial or recurrent knowledge test being

proposed in part 107. The FAA plans to use its existing knowledge tests for manned-aircraft 

operations as a source of questions for general aeronautical and aviation knowledge, such as 

right of way requirements and airspace limitations that would be tested under part 107. 

Consequently, the only area of knowledge on the initial or recurrent test for which the FAA 

would have to create new original content would be test questions that test the person’s 

understanding of the legal requirements imposed by part 107. Therefore, the FAA anticipates 

that there would be minimal costs with the development of the initial and recurrent tests.

We also note that, as with all of current FAA knowledge tests, the FAA will also conduct 

a periodic review on the quality and efficacy of the small UAS initial and recurrent knowledge 

tests as part of its overall continuing quality assurance program. This is an existing program that 

applies to all of the FAA’s knowledge tests and the small UAS tests would simply be a marginal 

addition to this program.

Although a flight school could be an option for learning the required material, the 

proposed rule does not require applicants to attend flight school, or otherwise require initial or 

recurrent knowledge test training, as the FAA would offer all the information necessary to pass a 

 46 http://www.faa.gov/regulations_policies/handbooks_manuals/aviation
39

knowledge test online. The FAA believes that little preparation would be necessary for 

applicants with existing pilot or UAS operator experience. Because the aeronautical 

background/experience of each UAS operator certificate applicant is different, the amount of 

time needed to study to prepare for the knowledge test will vary accordingly. For example, a 

prospective UAS operator who currently holds an airman certificate for manned-aircraft aviation 

would already possess a significant amount of general aviation knowledge. This person would 

only need to become familiar with the UAS-specific areas of knowledge that would be tested 

under part 107 in order to acquire sufficient knowledge to pass that test. Conversely, an 

applicant with no prior aeronautical experience would also need to acquire general aviation 

knowledge in addition to UAS-specific knowledge in order to pass the test that would be 

required under part 107. Regardless, this proposed rule would leave the specific method of study 

up to the applicant’s discretion, and it would not mandate initial or recurrent training prior to 

taking the small UAS knowledge test. While the FAA believes the preparation time to take an 

initial or recurrent knowledge test would be minimal, this estimate may be revised at the final 

rule stage. We request comments, with supporting documentation, on small UAS applicant’s 

background, experience, knowledge, and skill level and their estimated study time for a small 

UAS knowledge test.

Upon successfully completing a knowledge test and vetting by TSA, an operator would 

be issued an unmanned aircraft operator certificate with a rating for small UAS and may begin

utilizing a small UAS for non-recreational operations.

There are many existing private FAA-approved knowledge testing centers that administer 

knowledge tests for currently-existing airman certificates. These test centers are located by 

airports in every state throughout the United States, and under this proposed rule, they may 
40

choose to also administer knowledge tests for an operator certificate. The FAA assumes that the

cost of a KTC to administer an FAA approved small UAS knowledge test, including compliance 

fees, is $150.

47 

In estimating the proposed rule’s cost for initial and recurrent administering knowledge 

based tests, we use $150 regardless of whether the test is an initial or a recurrent test. The FAA 

notes that we are proposing to allow pilots with military experience operating unmanned aircraft 

to meet the more limited recurrent written test requirements in order to be eligible for an 

unmanned aircraft operator certificate with a small UAS rating. For a conservative cost estimate, 

we also use the $150 knowledge test fee for pilots with military experience because the FAA is 

not aware of how many pilots with military experience will apply for a small UAS operator 

certificate.

48

The FAA has determined that proposed § 107.61 would impose compliance costs to all 

small UAS applicants and operators to pass initial and recurrent aeronautical knowledge written 

tests. In the “Number of small UAS Operators and Applicants” section, we explain the 

derivation of the number of small UAS operators and applicants and calculate the number that 

would take either an initial or recurrent knowledge test. We multiply the number of small UAS 

operators’ or applicants’ costs from Table 3 by $150 and then by 10 percent to account for the 

small UAS operator or applicant failure rate.

Table 5 shows the proposed rule’s total estimated cost for the initial and recurrent 

knowledge test fees over the five year analysis period. 

 47 http://www.catstest.com/airman-testing-exams/recreational-private-pilot.php 48 We note that military pilots might be able to take the test for free at a joint testing center, but again the FAA is not 

aware on how many pilots with military experience would exercise this option.
41

Table 5

Small UAS Operators and Applicants Knowledge Test Fee Cost

(Thousands of Current Dollars)

Total who Incur 

Costs Knowledge Adjustment Total Costs 7 % Present Value

Year From Table 3 Test Cost Factor (000) (000)

1 3,236 $150 1.1 $533.9 $499.0

2 2,589 $150 1.1 $427.2 $373.1

3 5,307 $150 1.1 $875.7 $714.8

4 2,397 $150 1.1 $395.5 $301.7

5 1,917 $150 1.1 $316.3 $225.5

Total $2,548.6 $2,114.2

* Details may not add to row or column totals due to rounding.

V.D.3. Positive Identification of the Applicant Fee

TSA is required to conduct a security threat assessment for all persons holding a FAA 

pilot certificate. As operators of small UAS would hold FAA airmen certificates, all applicants 

for such certificates must be vetted by TSA. To comply with this requirement, FAA currently 

requires all applicants for a manned pilot certificate to apply in person and present positive 

identification at the time of application. The positive identification includes an official 

photograph of the applicant, the applicant’s signature, and the applicant’s residential address, if 

different from the mailing address. Proposed § 107.63 would require an applicant for a small 

unmanned aircraft operator certificate with a small UAS rating to submit the application to any 

persons authorized by the Administrator. The person accepting the application submission 

would be required to verify that the identity of the applicant matches the identity that is provided 

on the application, as described above for a pilot certificate. 

FAA assumes that applicants would present identification for validation at the same 

location that they go to in order to take the knowledge test. Thus, we assume that applicants 

incur no additional travel fees for TSA vetting.
42

FAA experts also estimate that the person doing the positive identification would charge 

a processing fee that would range from $25 to $50 to validate identification. Because the DPE, 

CFI or other designated authorized personnel at the KTC already have experience verifying an 

applicant’s identity, this proposed rule would also allow these personnel to accept an application 

for an unmanned aircraft operator certificate with a small UAS rating and verify the identity of 

the applicant. For this analysis, the FAA conservatively will use a $50 fee to validate 

identification. We multiply the initial number of applicants who incur costs from Table 3 by $50

to acquire the positive identification fee costs and then by 10 percent to account for the applicant 

failure rate of the aeronautical knowledge test. The FAA notes the proposed rule would require 

identification validation only during the initial certification process, and thus, small UAS 

operators from Table 3 who required recurrent testing in Year 3 through Year 5 would not have 

to have their identification validated again when they take the recurrent knowledge test. The 

FAA also notes that the small UAS operators from Table 3 who left for other opportunities (192 

in Year 4 and 154 in Year 5) are not included in this cost estimate.

Table 6 shows the proposed rule’s total estimated cost for the positive identification of 

the applicants over the five year analysis period. 
43

Table 6

Small UAS Applicants Positive Identification Fee Cost

(Thousands of Current Dollars)

Number of Positive Application Total Costs

7 % Present 

Value

Year

sUAS 

Applicants

Identification 

Fee

Failure 

Rate (000) (000)

1 3,236 $50 1.1 $178.0 $166.3

2 2,589 $50 1.1 $142.4 $124.4

3 2,071 $50 1.1 $113.9 $93.0

4 0 $50 1.1 $0.0 $0.0

5 0 $50 1.1 $0.0 $0.0

Total $434.3 $383.7

* Details may not add to row or column totals due to rounding.

V.D.4. Small UAS Registration Fee

Section 107.89 would require each small UAS aircraft to be registered with the FAA and 

listed in the Aircraft Registration database in order to operate within the NAS. The FAA 

Aircraft Registration database provides a means for the public and the FAA to identify the owner 

and operator of any US-registered aircraft. In particular, this information is necessary for FAA 

Aviation Safety Inspectors to perform their routine checks or to investigate an incident or 

accident. The FAA notes that all registrations must be renewed every three years. Therefore, 

unless a small UAS leaves the fleet, the small UAS that registered in Year 1 would have to 

renew its registration in Year 4. Similarly, unless a small UAS leaves the fleet, the small UAS 

that registered in Year 2 would have to renew its registration in Year 5.

Section 47.17 provides for a $5 registration fee to an owner of any aircraft. Therefore 

this analysis will also use $5 for the cost to a small UAS owner to register or renew the

registration for a small UAS aircraft. The $5 cost to the small UAS owner is transferred to the 

FAA to cover a portion of the cost of its services.
44

The FAA uses the “New Small UAS Fleet” and “Small UAS Leaving Fleet” columns

from Table 2 to estimate the number of initial and recurrent small UAS aircraft that are required 

to register under this proposal. The number of initial registrations for each of the first three years 

would be the number of new small UAS aircraft in each of those years. In Year 4, the number of 

initial and recurrent renewal registrations would be the number of new small UAS aircraft in the 

Year 4 plus the number of small UAS aircraft registration renewals, which would be the number 

of small UAS in Year 1 minus the number of small UAS aircraft that left the fleet in Year 2. 

Similarly, the number of new and renewal registrations in Year 5 would be the number of new 

small UAS aircraft in Year 5 plus the number of small UAS aircraft registration renewals, which 

would the number of small UAS in Year 2 minus the number of small UAS aircraft that left the 

fleet during the Year 3.

49 These calculations are shown in detail below and are summarized in 

Table 7 in the “Number of Initial and Recurrent Small UAS Registrations” column.

We note the initial and recurrent small UAS aircraft registrations from Table 7 will also 

be discussed later to estimate costs for sections “FAA Costs for Registration Fee Processing” and 

“Small UAS Registration Form”.

We assume that the renewal registration cost would be the same as the cost for the initial 

small UAS registration. We then multiply the yearly data in the “Number of Initial and 

Recurrent Small UAS Registrations” column by the $5 FAA registration fee. The “Total Costs” 

column in Table 7 shows these results, in thousands of dollars, over the five year analysis period.

 49 For ease of computation, we assumed that all of the retirements in the second year would happen to those 

applicants who applied in the first year and that that all of the retirements in the third year would happen to those 

applicants who applied in the second year. We request comment, with supporting data, on this assumption.
45

TABLE 7

Initial and Recurrent Registration Costs for Small UAS

(Thousands of Current Dollars)

Year

New sUAS 

Fleet (Table 

2) Initial 

Registration

sUAS 

Leaving 

Fleet 

(Table 

2)

sUAS 

Recurrent 

Registrations

sUAS 

Leaving 

Fleet

Number of 

Initial and 

Recurrent sUAS

Registrations

Total 

Costs 

(000)

7 % 

Present 

Value 

(000)

Registration 

Fee 

1 3,236 - - - 3,236 $5 $16.2 $15.12

2 3,236 647 - - 3,236 $5 $16.2 $14.13

3 3,236 1,165 - - 3,236 $5 $16.2 $13.21

4 1,387 1,579 3,236 647 3,976 $5 $19.9 $15.17

5 1,387 1,541 3,236 1,165 3,458 $5 $17.3 $12.33

Total $85.7 $70.0 

* Details may not add to row or column totals due to rounding.

As discussed earlier in the “Small UAS Fleet Forecast” section, the FAA notes that our 

small UAS forecast may be understated if operators choose to own more than one FAAregistered aircraft (for example, as a backup in case one aircraft is disabled). To account for this 

possibility, the FAA conducted a sensitivity analysis and assumes that an additional 20 percent 

increase in our small UAS forecast would result in the total costs in Table 7 increasing by 20 

percent to about $102,900.

V.E. Government Costs

The following section discusses the costs to the TSA for a security threat determination 

and the costs to the FAA for a certification of qualification to operate a small UAS.

V.E.1. Transportation Security Administration (TSA) Costs

The following section discusses the estimated costs to the TSA for a security threat 

determination fee. Under section 46111 of Title 49 of the United States Code, a person may not 
46

hold an aircraft operator certificate if the TSA has notified the Administrator, in writing, that the 

person poses a security threat.50 Since this proposed rule adds new small UAS operators, the 

TSA would acquire a new cost to determine if the operators pose a security threat. The TSA 

considers someone to be a security threat when he or she is known to pose or is suspected of 

posing a threat to national security, to transportation security, or of terrorism. 

In estimating the proposed rule’s cost for the TSA security threat determination, we use 

$130 per applicant.51 The proposed rule does not require the applicant to pay a fee for a security 

threat determination; although at some point in the future these costs may be passed directly to 

the operator.

As in the “Positive Identification of the Applicant Fee” section, the FAA notes that small 

UAS applicants from Table 3 who required recurrent testing in Year 3 through Year 5 would not 

be subject to another security threat determination. The FAA also notes that the operators from 

Table 3 who left for other opportunities (192 in Year 4 and 154 in Year 5) are not included in 

this cost estimate. The FAA notes that once vetted, small UAS operators may continue to be 

screened by TSA for other security concerns.

We multiply the number of small UAS applicants, by year, by $130. Table 8 shows the 

proposed rule’s total estimated cost for the TSA security threat determination over the five year 

analysis period. 

 50 http://codes.lp.findlaw.com/uscode/49/VII/A/IV/461/46111 51 The FAA believes that the $130 is reasonable because the cost has been identified as a vetting fee during 

conversations with TSA and the FAA registration office. In addition, TSA charges $130 to vet foreign student 

pilots: https://www.flightschoolcandidates.gov/afsp2/?acct_type=c§ion=WN#C8 .
47

Table 8 

TSA Security Threat Determination Cost for Small UAS Applicants

(Thousands of Current Dollars)

Number of 

sUAS Threat 

Total 

Costs

7 % Present 

Value

Year Applicants

Determination 

Fee (000) (000)

1 3,236 $130 $420.7 $393.2

2 2,589 $130 $336.6 $294.0

3 2,071 $130 $269.2 $219.8

4 0 $130 $0.0 $0.0

5 0 $130 $0.0 $0.0

Total $1,026.5 $906.9

* Details may not add to row or column totals due to rounding.

V.E.2. FAA Costs for a Small UAS Operator Certificate

In addition to passing an initial aeronautical knowledge test, proposed § 107.63 would 

require a small UAS applicant to obtain an unmanned aircraft operator certificate with a small 

UAS rating from the FAA before operating a small UAS. An unmanned aircraft operator 

certificate would be a new type of airman certificate created by this proposed rule and therefore 

would constitute a paperwork cost. 

The FAA estimates that, for a small UAS operator certificate, this provision would add 

one page for each applicant to provide personal information such as name, address, date of birth, 

height, weight, eye and hair color. This certificate would also include test information such as 

test identification number and passing grade. For each small UAS applicant, the FAA estimates 

that it will take 0.25 hours to process the paperwork to issue the certificate. 

In the “Number of small UAS Operators and Applicants” section we discuss our estimate 

of the number of small UAS applicants. This estimate is shown in Table 3 in the “Initial 

Applicants” column and is also used in Table 9 to estimate the total costs for a small UAS FAA 

certificate to an applicant. To estimate the FAA costs for a small UAS certification of 
48

qualification, we multiply the annual number of small UAS applicants from Table 3 by the time 

it takes the FAA to process the paperwork (0.25 hours), and then by the hourly value of an FAA 

support person from the “Assumption and Data” section. Table 9 shows the estimate costs to the 

FAA for processing a certification of qualification over the five year analysis interval. Although 

these are estimated as government costs, at some point in the future these costs may be passed 

directly to the operator.

Table 9

Small UAS Operators and Applicants FAA Certification of Qualification Costs

(Thousands of Current Dollars)

Number of 

sUAS Applicant

FAA 

Support

Total 

Costs

7 % Present 

Value

Year Applicants

Time 

(Hours)

Hourly 

Wage (000) (000)

1 3,236 0.25 $20.06 $16.2 $15.2

2 2,589 0.25 $20.06 $13.0 $11.3

3 2,071 0.25 $20.06 $10.4 $8.5

4 0 0.25 $20.06 $0.0 $0.0

5 0 0.25 $20.06 $0.0 $0.0

Total $39.6 $35.0

* Details may not add to row or column totals due to rounding.

V.E.3. FAA Costs for Registration Fee Processing

In the “Small UAS Registration Fee” section we estimated the number of initial and 

recurrent small UAS aircraft registrations and provided estimates of the total costs of the $5 

registration fee in Table 7. In Table 10 below, we estimate the remaining FAA costs to register a 

small UAS based on our estimate of the number of initial and recurrent small UAS registrations

shown in Table 7. Currently the FAA’s preliminary estimate of the FAA’s cost to register an 

aircraft is $28. We calculated this estimated cost based on 2012 direct costs from the FAA Cost 

Accounting System (CAS) (both labor and contract direct costs) and overhead and then divided
49

by the 2012 total number of registrations. Because under the existing fee structure the operator 

would incur a $5 fee to register the aircraft, the FAA estimates our unreimbursed cost to register 

a small UAS is $23 ($28 - $5).52 We multiply the yearly data in the “Number of Initial and 

Recurrent Small UAS Registrations” column by the FAA unreimbursed cost to register a small 

UAS fee of $23. 

The “Total Costs” column in Table 10 shows these results over the five year analysis 

period. Although these are estimated as government costs, at some point in the future these costs 

may be passed directly to the operator.

Table 10

Small UAS FAA Registration Costs

(Thousands of Current Dollars)

Number of Initial and 

Recurrent

Registration 

Fee

Total 

Costs

7 % Present 

Value

Year Small UAS Registrations Processing Cost (000) (000)

1 3,236 $23 $74.4 $69.6 

2 3,236 $23 $74.4 $65.0 

3 3,236 $23 $74.4 $60.8 

4 3,976 $23 $91.4 $69.8 

5 3,458 $23 $79.5 $56.7 

Total 17,142 $394.3 $321.8 

* Details may not add to row or column totals due to rounding.

The FAA notes that our small UAS forecast from the “Small UAS Fleet Forecast” section 

may be understated if operators choose to own more than one FAA-registered aircraft (for 

example, as a backup in case one aircraft is disabled). To account for this possibility, as a 

sensitivity analysis the FAA estimated an additional 20 percent increase in the small UAS 

forecast would result in the total costs in Table 10 increasing by 20 percent to about $473,100. 

 52 As this is a preliminary estimate of the registration fee the FAA may charge, the FAA also conducted a sensitivity 

analysis for a $50 small UAS Registration fee and have estimate the costs would total about $850,000 over the five 

year analysis interval.
50

V.F. Time Resource Opportunity Costs 

Time is a valuable economic resource. In this section, we estimate the costs for the travel 

time to a KTC, the paperwork costs for the time to fill out the applications and forms required by 

this proposed rule, and the time to take the aeronautical knowledge test. The FAA notes that 

these estimates are not for out-of-pocket costs to small UAS operators or applicants; rather they 

are opportunity costs for their time.

V.F.1. Travel Time

In the “Travel Expense” section, we estimated the cost that a small UAS operator or 

applicant would incur travel 19 miles one way to reach the closest KTC location and the number 

of applicants who take either an initial or recurrent test. In this section we estimate the time it 

takes the small UAS operator or applicant to travel the 19 miles one way to reach their closest 

KTC location and quantify that time as a cost of this proposal.

A round trip of 38 miles (19 * 2), would take an applicant 41.45 minutes of driving time 

((38 miles / 55 MPH) * (60 minutes / 1 hour)). We multiply the total number of small UAS 

operators and applicants from Table 3 by the 41.45 minute driving time, and then by the hourly 

value for travel time from the “Assumptions and Data” section and then by 10 percent to account 

for the applicant failure rate. Table 11 shows the total estimate costs for the time it takes 

applicants and operators to drive to a KTC over the five year analysis interval.
51

Table 11

Small UAS Operators and Applicants Travel Time Cost

(Thousands of Current Dollars)

Total who Incur 

Costs Driving Hourly Wage Application Total Costs

7 % Present 

Value

Year From Table 3 Time (minutes) (Travel Time) Failure Rate (000) (000)

1 3,236 41.45 $24.68 1.1 $60.7 $56.7

2 2,589 41.45 $24.98 1.1 $49.1 $42.9

3 5,307 41.45 $25.28 1.1 $101.9 $83.2

4 2,397 41.45 $25.58 1.1 $46.6 $35.5

5 1,917 41.45 $25.89 1.1 $37.7 $26.9

Total $296.1 $245.3

* Details may not add to row or column totals due to rounding.

V.F.2. Knowledge Test Application

Proposed §107.67 would require a small UAS operator or applicant to complete a 

knowledge test application in order to be able to take the knowledge test necessary to obtain an 

operator certificate.

The FAA estimates it would take about 0.25 hours (15 minutes) to complete the 

application. In order to estimate the paperwork costs, we multiply the annual number of 

applicants who would take both the initial and recurrent knowledge test from Table 3 by 0.25 

hours and then by the hourly value for personal time from the “Assumptions and Data” section. 

We then multiply the knowledge test application costs by 10 percent to account for the applicant 

failure rate. Table 12 shows the proposed rule’s total estimated cost to complete the application 

over the five year analysis interval.
52

Table 12

Small UAS Operators and Applicants Knowledge Test Application Costs

(Thousands of Current Dollars)

Total who Incur 

Costs Applicant Hourly Wage Application Total Costs

7 % Present 

Value

Year From Table 3 Time (hours)

(Personal 

Time) Failure Rate (000) (000)

1 3,236 0.25 $25.09 1.1 $22.3 $20.9

2 2,589 0.25 $25.39 1.1 $18.1 $15.8

3 5,307 0.25 $25.70 1.1 $37.5 $30.6

4 2,397 0.25 $26.01 1.1 $17.1 $13.1

5 1,917 0.25 $26.32 1.1 $13.9 $9.9

Total $108.9 $90.2

* Details may not add to row or column totals due to rounding.

V.F.3. Physical Capability Certification

A person seeking to be a small UAS operator could have a medical condition that would 

interfere with the safe operation of a small UAS. In § 107.63, the FAA proposes that the small 

UAS applicant be required to make a certification that they have no physical or mental condition 

that would interfere with the safe operation of a small UAS. The certification of physical 

capability would be a preprinted statement on the small UAS operator certificate application 

(8710-xx) and when the applicant signs the 8710-xx, they would also be attesting that they meet 

the requirement to operate a small UAS safely.

In the “Number of small UAS Operators and Applicants” section we discuss our estimate 

of the number of small UAS applicants. This estimate is shown in Table 3 in the “Initial 

Applicants” column and is also used in Table 13 to estimate the total costs for a small UAS FAA 

certificate to an applicant.

The FAA estimates that this provision would take less than 0.1 hours (6 minutes) to 

complete the physical capability certification. We multiply the number of small UAS applicants 

from Table 3 by the time it takes to complete the physical capability certification form and then 
53

by the hourly value for personal time from the “Assumptions and Data” section. Table 13 shows 

the estimate costs for time process a certification of physical capability form over the five year 

analysis interval.

TABLE 13

Small UAS Operators and Applicants Physical Capability Certification Costs

(Thousands of Current Dollars)

Number of sUAS Applicant Hourly Wage

Total 

Costs

7 % Present 

Value

Year Applicants

Time 

(Hours)

(Personal 

Time) (000) (000)

1 3,236 0.1 $25.09 $8.1 $7.6

2 2,589 0.1 $25.39 $6.6 $5.7

3 2,071 0.1 $25.70 $5.3 $4.3

4 0 0.1 $26.01 $0.0 $0.0

5 0 0.1 $26.32 $0.0 $0.0

Total $20.0 $17.7

* Details may not add to row or column totals due to rounding.

V.F.4. Knowledge Test Time 

The time it takes a small UAS operator or applicant to take the initial or recurrent 

aeronautical knowledge test proposed in § 107.73 is a compliance cost of the proposed rule. 

Currently, FAA initial and recurrent knowledge tests are taken online and each screen represents 

one question and multiple choice answers. Assuming that the initial and recurrent exams are the 

typical 60 questions, each screen equals one page, and there would also be some introduction, 

instruction, and closing screen to the tests to read. The FAA estimates that it would take up to 

three hours for an applicant to take the knowledge test. 

In order to estimate the knowledge test time costs for this section, we multiply the 

number of small UAS operators and applicants who would take both the initial and recurrent 

knowledge test from Table 3 by the time it takes for an applicant to take the knowledge test and 
54

then by the hourly value for personal time from the “Assumptions and Data” section. We then 

multiply the knowledge test time costs by 10 percent to account for the applicant failure rate. 

Table 14 shows the estimate costs over the five year analysis interval.

Table 14

Small UAS Operators and Applicants Knowledge Testing Time Cost

(Thousands of Current Dollars)

Total who Incur 

Costs Applicant Hourly Wage Application Total Costs

7 % Present 

Value

Year From Table 3 Time (hours)

(Personal 

Time)

Failure 

Rate (000) (000)

1 3,236 3 $25.09 1.1 $267.9 $250.4

2 2,589 3 $25.39 1.1 $216.9 $189.5

3 5,307 3 $25.70 1.1 $450.0 $367.4

4 2,397 3 $26.01 1.1 $205.7 $156.9

5 1,917 3 $26.32 1.1 $166.5 $118.7

Total $1,307.1 $1,082.9

* Details may not add to row or column totals due to rounding.

V.F.5. Small UAS Registration Form

Section 107.89 also proposed that all small unmanned aircraft must be registered. The 

FAA estimates that this provision would take 0.5 hours for the owner to complete the required 

form. 

In the “Small UAS Registration Fee” section we estimated the number of initial and 

recurrent small UAS registrations and show the results in Table 7. In Table 15 below, we 

estimate the total costs to complete the required form based on our estimate of the number of 

initial and recurrent small UAS registrations shown in Table 7. 

We multiply the number of annual number of initial and recurrent small UAS 

registrations from the “Small UAS Registration Fee” section by the time it would take to 

complete each registration form and then by the hourly value for personal time from the 

“Assumptions and Data” section. 
55

Table 15 shows the estimated registration form cost, in thousands of dollars, over the five 

year analysis period.53

TABLE 15

Small UAS Registration Form Costs 

(Thousands of Current Dollars)

Number of Initial and 

Recurrent Applicant Hourly Wage Total Costs

7 % Present 

Value

Year Small UAS Registrations

Time 

(hours)

(Personal 

Time) (000) (000)

1 3,236 0.5 $25.09 $40.6 $37.9

2 3,236 0.5 $25.39 $41.1 $35.9

3 3,236 0.5 $25.70 $41.6 $33.9

4 3,976 0.5 $26.01 $51.7 $39.4

5 3,458 0.5 $26.32 $45.5 $32.4

Total $220.5 $179.7

* Details may not add to row or column totals due to rounding.

V.F.6. Change of Name or Address Form 

The FAA recognizes that individuals who hold airman certificates may change their name 

or address. Proposed § 107.77 would require the holder of a small UAS operator certificate to 

change the name or address on a certificate by submitting appropriate paperwork to the FAA.

Not every small UAS operator would have a name or address change. Although the FAA 

does not have data on small UAS operators that would change their name or address we do have 

data on sport pilots. The FAA calculated that about 15 percent of sport pilots have changed their 

name or address in 2012 and for this analysis we use 15 percent to estimate the small UAS 

operators who would change their name and address.

 53 The FAA notes that our small UAS forecast may be understated if operators choose to own extra FAA-registered 

aircraft in case one is disabled or companies choose have an inventory of small UAS to lease to FAA-approved 

operators. If this is the case, then the FAA assumes an additional 20 percent increase in our small UAS forecast and 

as a sensitivity analysis, the costs in Table 14 would increase by 20 percent. We request comments, with supporting 

documentation, from owners who would register more than one small UAS and lease them out.
56

The FAA estimates that this provision would take 0.25 hours to complete for about 15

percent of the small UAS operators. The FAA estimates that it would cost each applicant $6.17 

($24.68 * 0.25) to complete the form. We multiply 15 percent by the number of applicants from 

Table 3 in the “Number of small UAS Operators” section and then by the time it would take to 

complete the change of name or address form and then by the hourly value for personal time 

from the “Assumptions and Data” section. Table 16 shows the estimated cost for the time to fill 

out the forms to either change a name or address over the five year analysis period.

Table 16

Small UAS Operators and Applicants Change Name or Address Costs 

(Thousands of Current Dollars)

Total who 

Incur 

Costs

Percent Who 

Change sUAS Operators 

Who Applicant 

Hourly 

Wage

Total 

Costs

7 % Present 

Value

Year

From 

Table 3

Name or 

Address

Change Name or 

Address

Time 

(hours)

(Personal 

Time) (000) (000)

1 3,236 0.15 485 0.25 $25.09 $3.0 $2.8

2 2,589 0.15 388 0.25 $25.39 $2.5 $2.2

3 5,307 0.15 796 0.25 $25.70 $5.1 $4.2

4 2,397 0.15 360 0.25 $26.01 $2.3 $1.8

5 1,917 0.15 288 0.25 $26.32 $1.9 $1.4

Total $14.9 $12.3

* Details may not add to row or column totals due to rounding.

V.F.7. Accident Reporting Form

Section 107.9 requires that an operator report any operation of the small UAS that 

involves any injury to a person or damage to any property, other than the small UAS. The FAA 

estimates that there is one page of paperwork associated with reporting an accident and it would 

take an applicant 0.25 hours to complete. In the absence of data relating to UAS accident rates, 

the FAA assumes that small UAS would have the same accident rate as general aviation pilots;
57

therefore, we calculated the probability of an accident by dividing the accident rate for general 

aviation pilots by the total number of hours and estimated that an accident would occur .001% of 

the time. The expected total time to report accidents is 0.0000025 hours (.00001 X .25 hours) 

which the FAA expects to be minimal. The FAA requests comments, with supporting 

documentation, on the accident rate for small UAS and the probability of a small UAS accident

resulting in an injury or damage to property other than the unmanned aircraft. The FAA also 

seeks comments on the preamble discussion of the threshold of property damage that should 

trigger the accident reporting requirement.

V.F.8. Maintenance and Inspection

Sections 107.19 and 107.21 require that the small UAS operators are responsible for 

identifying specific actions that must be taken to ensure that the small UAS will continue to 

operate safely. These specific actions may include periodic systems maintenance and inspection 

checks to avoid operational failures. The manufacturers of small UAS supplies user manuals, 

either in hard copy or on the internet, that include actions the operator must take to ensure that 

the small UAS will operate safely.

It is the responsibility of the operator to consult the manufacture’s user manual to 

maintain the small UAS in a condition safe for operation and inspect the small UAS prior to 

flight. Preflight inspection, battery condition, and maintenance are all addressed in the owner’s 

manuals that come with the small UAS. This proposal would require the operator to conduct a 

preflight inspection of the area of operation and the aircraft. It is anticipated that the nature and 

scope of each small UAS operation will vary greatly. Accordingly, the time it will take to 

perform the required preflight inspection will also vary. For example, the required preflight 
58

action for a simple small UAS operation conducted in a remote location using a simple-design 

small UAS that does not involve the use of support personnel may take only five minutes. 

Conversely, a small UAS operation in a populated area using additional support personnel and 

using a small UAS of a more complex design could take significantly longer. Failure to perform 

maintenance and inspections could result in the small UAS being destroyed, therefore causing 

the owner to lose their investment and their business revenue-generating opportunity. Without 

more context on small UAS applications, a quantitative estimate would be highly speculative. 

As a result, the FAA is not providing a quantified cost estimate associated with preflight 

inspections. We do anticipate that the cost for each specific preflight action would mostly be 

recovered by the operator as a cost of doing business for that flight. However, it would 

nonetheless be a social cost of the proposed rule. The FAA requests comments, with supporting 

documentation, as to the amount of time a preflight inspection would take.

V.F.9. FAA Knowledge Test Report

After a small UAS operator or applicant passes an initial or recurrent aeronautical 

knowledge test, the knowledge testing center (KTC) would issue an airman knowledge test 

report indicating whether the applicant passed the test. The information in the knowledge test 

report includes the name of the person who administered the test, the test approval number, the 

graduation number assigned to the certificate of qualification, a statement indicating whether the 

test was an initial or a recurrent test, and the name of the person who passed the test.

The FAA estimates that this provision would take 0.5 hours to complete this requirement. 

We multiply the number of small UAS operators and applicants who would take both the initial 

and recurrent knowledge test from Table 3 by the time it would take to issue an airman 
59

knowledge test report and then by the hourly value of a KTC support person from the 

“Assumption and Data” section. Table 17 shows the estimated paperwork costs to process a 

knowledge test certification over the five year analysis interval.

Table 17

Knowledge Test Center Report Costs

(Thousands of Current Dollars)

Total who Incur 

Costs Applicant KTC Support

Total 

Costs

7 % Present 

Value

Year From Table 3 Time (hours) Hourly Wage (000) (000)

1 3,236 0.5 $20.06 $32.5 $30.3

2 2,589 0.5 $20.06 $26.0 $22.7

3 5,307 0.5 $20.06 $53.2 $43.5

4 2,397 0.5 $20.06 $24.0 $18.3

5 1,917 0.5 $20.06 $19.2 $13.7

Total $154.9 $128.5

* Details may not add to row or column totals due to rounding.

V.F.10. FAA Enforcement Costs

The FAA does not anticipate that the proposed rule would increase its legal costs of 

enforcement. This is because, in the absence of this rulemaking, there already exist statutory and 

regulatory requirements that govern the operation of a UAS. 54 The FAA currently spends its 

enforcement resources ensuring compliance with these existing requirements.

If finalized, the proposed rule would create a set of legal standards more specifically 

applicable to the operation of a small UAS. Such legal standards would increase compliance by 

the regulated entities; thus, reducing the need for enforcement action. In addition, these legal 

standards would reduce the uncertainty associated with small UAS operation, which may in turn 

 54 See, e.g., Law Enforcement Guidance for Suspected Unauthorized UAS Operations, available at 

http://www.faa.gov/uas/regulations_policies/media/FAA_UAS-PO_LEA_Guidance.pdf (discussing existing legal requirements that apply to UAS 

operations).
60

reduce the likelihood of enforcement litigation. This is because litigation is more likely when the 

parties disagree as to which legal standards are applicable to an operation and how those 

standards apply to the operation.

V.G Individual small UAS Operator/Owner Out-Of-Pocket Costs

With respect to the potential operator costs, we assume that each operator would be a new 

entrant into the commercial market and that each operator would have one small UAS. Table 18 

shows the proposed rule’s estimated out-of-pocket startup and recurrent direct compliance costs 

for a new small UAS operator or owner.

TABLE 18

Small UAS Operator Out-Of-Pocket Costs 

(Current Dollars)

Cost

Type of Cost Initial Recurrent

Applicant/small UAS operator

 Travel Expense $9 $9 

 Knowledge Test Fees $150 $150 

 Positive Identification of the Applicant Fee $50 -

Total applicant/small UAS operator $209 $159 

Owner

 Small UAS Registration Fee $5 $5 

Total Owner $5 $5 

Total $214 $164 

* Details may not add to row or column totals due to rounding.

The FAA notes that at some point in the future the costs estimated in the “Government 

Costs” section may be passed directly to the operator. 
61

V.H Summary of Total Costs 

The proposed rules major costs are the knowledge test requirements for the airman 

certification of small UAS operators, the positive identification of their identity, and the travel 

costs. The Transportation Security Administration (TSA) would incur costs vetting applicants 

for national security. The FAA incurs costs to issue operator certificates with a small UAS 

rating. Additional costs would also accrue from time it takes to complete the paperwork due to 

accident reporting, airman and aircraft certification, airman name or address changes, and the 

registration of a small UAS. 

In Table 19, we summarize the total estimated compliance costs by category.
62

TABLE 19

Total and Present Value Cost Summary by Provision

Total Costs 7 % P.V.

Type of Cost (000) (000)

Applicant/small UAS operator

 Travel Expense $151.7 $125.9

 Knowledge Test Fees $2,548.6 $2,114.2

 Positive Identification of the Applicant Fee $434.3 $383.7

Owner

 Small UAS Registration Fee $85.7 $70.0

Time Resource Opportunity Costs 

 Applicants Travel Time $296.1 $245.3

 Knowledge Test Application $108.9 $90.2

 Physical Capability Certification $20.0 $17.7

 Knowledge Test Time $1,307.1 $1,082.9

 Small UAS Registration Form $220.5 $179.7

 Change of Name or Address Form $14.9 $12.3

 Knowledge Test Report $154.9 $128.5

 Pre-flight Inspection Not quantified

 Accident Reporting Minimal Costs

Government Costs

 TSA Security Vetting $1,026.5 $906.9

 FAA - sUAS Operating Certificate $39.6 $35.0

 FAA - Registration $394.3 $321.8

Total Costs $6,803.1 $5,714.0

* Details may not add to row or column totals due to rounding.

The FAA requests comments, with supporting documentation, on the cost estimates and 

forecasts presented in this chapter.55

V.I Cost Estimate for Special Rule for Model Aircraft

The proposed rule would also codify the special rule for model aircraft that Congress 

created in Public Law 112-95, § 336. Section 336 of Public Law 112-95 defines a model aircraft 

as an “unmanned aircraft that is – (1) capable of sustained flight in the atmosphere; (2) flown 

 55 See Appendix 4 for a sensitivity analysis on the Time Resource Opportunity Costs.
63

within visual line of sight of the person operating the aircraft; and (3) flown for hobby or 

recreational purposes.” Section 336 limits the FAA’s rulemaking authority over model aircraft 

that meet all of the following criteria:

• The aircraft is flown strictly for hobby or recreational use;

• The aircraft is operated in accordance with a community-based set of safety 

guidelines and within the programming of a nationwide community-based organization;

• The aircraft is limited to not more than 55 pounds unless otherwise certified 

through a design, construction, inspection, flight test, and operational safety program 

administered by a community-based organization; 

• The aircraft is operated in a manner that does not interfere with and gives way to 

any manned aircraft; and

• When flown within 5 miles of an airport, the operator of the aircraft provides the 

airport operator and the airport air traffic control tower (when an air traffic facility is located at 

the airport) with prior notice of the operation. 

However, while § 336 limits the FAA’s rulemaking authority over model aircraft that 

meet the above criteria, it does not limit the FAA’s authority to pursue enforcement action 

against those model aircraft operators that “endanger the safety of the national airspace system.” 

The proposed rule would codify this enforcement authority in part 101. Because the modelaircraft component of the proposed rule would simply codify enforcement authority that the FAA 

already possesses, it will not result in any costs or benefits.

The FAA requests comments, with supporting documentation, on this conclusion.
64

VI. BENEFIT – COST CONCLUSION

The benefit of this proposed rule is that it would enable new business and other nonrecreational small UAS opportunities to occur in a safe operating environment. 

The estimated out-of-pocket cost for a small UAS operator to be FAA-certified is less 

than $300. As this proposal enables new businesses, the private sector expected benefits would 

exceed private sector expected costs. As profitable opportunities increase, so will the social 

benefits. In addition, if the use of a small UAS saves one human life, that alone would result in 

benefits outweighing the costs of this proposed rule. Accordingly the FAA has determined that 

the proposed rule would be cost beneficial.

In order to evaluate the net benefits of a rule, we must generally evaluate the costs and 

benefits associated with each provision. We must also look at the collective costs and benefits of 

related provisions. In the context of this rule, this analysis involves weighing the potential safety 

benefits of each individual provision, as well as related provisions, against the possibility that the 

provision, or related provisions, may preclude certain potential, valuable applications of UAS. 

Because the UAS industry is in its infancy, we lack data on both the safety effects of provisions 

and the likely effects on development of UAS applications. The FAA invites information and 

data from commenters on these issues to assist us to engage in a quantitative analysis of the 

likely net benefits of the proposed rule. Finally, we anticipate that as small UAS operations 

increase over time and we gain experience in integrating them into the National Air Space 

(NAS), the requirements proposed in this rule would be re-evaluated and correspondingly 

adjusted.
65

Appendix 1

Aerial Aviation Photography Accidents 2005-2009

Count Date NTSB # Fatalities Serious Minor Hull

1 10/14/2009 ANC10FA004 1 1 0

2 3/20/2009 WPR09LA160 0 0 0

Substantial 

Damage

3 1/25/2009 ERA09FA141 1 1 0

4 3/13/2008 NYC08FA133 4 0 0

5 3/4/2008 ANC08LA040 0 0 2

6 10/6/2007 NYC08LA005 1 1 0

7 9/11/2007 MIA07FA147 2 1 0

8 7/22/2007 SEA07LA209 0 1 1

9 10/18/2006 LAX07FA012 5 0 0

10 10/11/2006 MIA07CA004 0 0 0 Destroyed

11 8/10/2006 LAX06LA257 1 1 0

12 4/20/2006 NYC06FA100 2 0 0

13 3/15/2006 DEN06CA048 0 0 0

14 2/26/2006 LAX06FA124 2 0 0

15 6/26/2005 DEN05CA094 0 0 0

16 3/15/2005 ANC05CA049 0 0 0

17 2/12/2005 LAX05CA102 0 0 0
66

Appendix 2 – Value of Statistical Life (VSL)

Estimated Value of Preventing Fatalities and Injuries 

(2013 $)

Analysis 

Year

Calendar 

Year

Growth 

Factor VSL Serious Minor

0 2013 1.0000 $9,200,000 $1,281,900 $27,600

1 2014 1.0118 $9,308,560 $1,297,026 $27,926

2 2015 1.0237 $9,418,401 $1,312,331 $28,255

3 2016 1.0358 $9,529,538 $1,327,817 $28,589

4 2017 1.0480 $9,641,987 $1,343,485 $28,926

5 2018 1.0604 $9,755,762 $1,359,338 $29,267

6 2019 1.0729 $9,870,880 $1,375,378 $29,613

7 2020 1.0856 $9,987,357 $1,391,608 $29,962

8 2021 1.0984 $10,105,207 $1,408,029 $30,316

9 2022 1.1114 $10,224,449 $1,424,644 $30,673

10 2023 1.1245 $10,345,097 $1,441,454 $31,035

Source: "Revised Departmental Guidance 2014: Treatment of the Value of Preventing Fatalities 

and Injuries in Preparing Economic Analyses"
67

Appendix 3 – 2013 Airmen Knowledge Tests - Weighted Average Calculation

Category Volume

Pass 

Rate Average Weighted

Air Transport Pilot Airplane (14 CFR part 121) 8,019 95.1% 86.0 7,622.1

Air Transport Pilot Airplane (14 CFR part 135) 516 89.3% 80.6 461.0

Aircraft Dispatcher 1,286 72.7% 75.6 935.1

Airline Transport Pilot Airplane (14 CFR part 135) (Added Rating) 16 68.8% 76.4 11.0

Airline Transport Pilot Airplane Canadian Conversion 86 96.5% 86.5 83.0

Airline Transport Pilot Helicopter (14 CFR part 135) 717 97.5% 88.4 699.0

Airline Transport Pilot Helicopter (14 CFR part 135) (Added Rating) 47 78.7% 79.7 37.0

Aviation Maintenance Technician Airframe 8,744 86.6% 80.3 7,567.9

Aviation Maintenance Technician General 9,373 90.5% 82.1 8,484.4

Aviation Maintenance Technician Powerplant 8,878 80.5% 77.6 7,146.8

Commercial Pilot Airplane 8,421 96.3% 87.0 8,108.6

Commercial Pilot Airplane Canadian Conversion 78 88.5% 83.4 69.0

Commercial Pilot Airship 0 0.0% 0.0 0.0

Commercial Pilot Balloon – Gas 0 0.0% 0.0 0.0

Commercial Pilot Balloon - Hot Air 67 97.0% 87.8 65.0

Commercial Pilot Glider 42 100.0% 91.3 42.0

Commercial Pilot Gyroplane 1 100.0% 92.0 1.0

Commercial Pilot Helicopter 980 96.8% 88.0 949.0

Flight Engineer Reciprocating Engine (Added Rating) 1 100.0% 80.0 1.0

Flight Engineer Reciprocating Engine (Basic) 8 100.0% 87.3 8.0

Flight Engineer Turbojet (Added Rating) 0 0.0% 0.0 0.0

Flight Engineer Turbojet (Basic) 48 100.0% 94.5 48.0

Flight Engineer Turboprop (Added Rating) 2 100.0% 80.0 2.0

Flight Engineer Turboprop (Basic) 10 100.0% 86.1 10.0

Flight Instructor Airplane 3,474 89.7% 83.4 3,115.8

Flight Instructor Airplane (Added Rating) 60 91.7% 84.5 55.0

Flight Instructor Glider 28 100.0% 90.1 28.0

Flight Instructor Glider (Added Rating) 44 84.1% 85.2 37.0

Flight Instructor Gyroplane 2 100.0% 89.5 2.0

Flight Instructor Gyroplane (Added Rating) 1 100.0% 88.0 1.0

Flight Instructor Helicopter 598 96.2% 85.5 575.0

Flight Instructor Helicopter (Added Rating) 56 92.9% 88.5 52.0

Flight Instructor Instrument Airplane 2,719 96.8% 88.2 2,630.9

Flight Instructor Instrument Airplane (Added Rating) 68 97.1% 84.4 66.0

Flight Instructor Instrument Helicopter 521 96.4% 85.5 502.0

Flight Instructor Instrument Helicopter (Added Rating) 45 95.6% 86.8 43.0

Flight Instructor Sport Airplane 33 93.9% 85.5 31.0

Flight Instructor Sport Glider 0 0.0% 0.0 0.0
68

Flight Instructor Sport Gyroplane 0 0.0% 0.0 0.0

Flight Instructor Sport Powered Parachute 7 100.0% 87.1 7.0

Flight Instructor Sport Weight-Shift-Control 6 83.3% 81.2 5.0

Flight Navigator 2 100.0% 85.0 2.0

Fundamentals of Instructing 4,570 91.9% 84.8 4,198.9

Ground Instructor (Advanced) 953 97.1% 87.5 925.0

Ground Instructor (Basic) 50 80.0% 77.2 40.0

Ground Instructor Instrument 789 97.2% 87.6 767.0

Inspection Authorization 964 85.5% 82.2 824.0

Instrument Rating Airplane 12,861 85.1% 80.1 10,948.6

Instrument Rating Airplane Canadian Conversion 47 93.6% 85.3 44.0

Instrument Rating Foreign Pilot 213 86.4% 81.7 184.0

Instrument Rating Helicopter 933 91.4% 82.6 853.0

Military Competency Airplane 1,379 99.5% 94.6 1,372.0

Military Competency Helicopter 1,621 99.3% 91.1 1,610.0

Military Competency Instructor 1,450 99.0% 93.1 1,435.1

Parachute Rigger 199 86.9% 80.3 173.0

Parachute Rigger Military Competence 65 98.5% 89.7 64.0

Private Pilot Airplane 24,902 90.9% 83.8 22,635.9

Private Pilot Airplane Canadian Conversion 31 100.0% 87.8 31.0

Private Pilot Airplane/Recreational Pilot - Transition 11 90.9% 82.5 10.0

Private Pilot Airship 1 0.0% 62.0 0.0

Private Pilot Balloon – Gas 0 0.0% 0.0 0.0

Private Pilot Balloon - Hot Air 109 90.8% 82.3 99.0

Private Pilot Glider 225 92.4% 86.5 208.0

Private Pilot Gyroplane 2 100.0% 92.5 2.0

Private Pilot Helicopter 1,537 95.5% 85.7 1,467.1

Private Pilot Helicopter/Recreational Pilot - Transition 4 75.0% 73.3 3.0

Private Pilot Powered Parachute 3 66.7% 80.3 2.0

Private Pilot Weight-Shift-Control 2 100.0% 89.5 2.0

Recreational Pilot Airplane 64 92.2% 83.0 59.0

Recreational Pilot Helicopter 2 100.0% 82.0 2.0

Sport Pilot Airplane 616 95.9% 85.8 591.0

Sport Pilot Glider 2 100.0% 79.0 2.0

Sport Pilot Gyroplane 8 100.0% 90.4 8.0

Sport Pilot Lighter-Than-Air (Balloon) 0 0.0% 0.0 0.0

Sport Pilot Powered Parachute 53 96.2% 83.9 51.0

Sport Pilot Weight Shift Control 49 100.0% 89.4 49.0

Weighted Average Calculation 108,719 98,164.1 90%
69

Appendix 4 – Sensitivity analysis on the Time Resource Opportunity Costs

The FAA performed a sensitivity analysis on the Time Resource Opportunity costs incurred by 

small UAS operators and applicants that is shown in Table 19. Instead of using the DOT 

guidance for the small UAS operator or applicant’s personal or business hourly wage rates from 

the “Assumption and Data” section, the sensitivity analysis used the personal wage rate for local 

travel from the Department guidance. 56 

The sensitivity analysis was applied to the small UAS operator or applicants travel time, 

knowledge test application time, physical capability certification time, knowledge test time, 

small UAS registration form time, and the change of name or address form time. The estimated 

cost calculations are the same as described in their perspective sections above, with the exception 

of using the local travel time – personal hourly wage rate.

The following table shows the results of these calculations.

 56 Source: Revised Departmental Guidance on The Valuation of Travel time in Economic Analysis (published June 

9, 2014 (Table 4, Local Travel - Personal). Per this guidance future Travel Time Saving estimates are also 

augmented by 1.2 percent per year to reflect projected annual growth of real median household income. Year 1 

(2012$) travel time savings estimates are calculated as $12.30*1.0122

= $12.60; Year 2 as $12.30*1.0123=$12.75; 

Year 3 as $12.30*1.0124

=$12.90; Year 4 as $12.30*1.0125=$13.06; and Year 5 as $12.30*1.0126=$13.21.
70

Sensitivity Analysis on Travel Time using $12.30 - Personal category from DOT Table 4 guidance

Total Costs 7 % P.V.

Type of Cost (000) (000)

Applicant/small UAS operator

 Travel Expense (mileage) $151.7 $125.9

 Knowledge Test Fees $2,548.6 $2,114.2

 Positive Identification of the Applicant Fee $434.3 $383.7

Owner

 Small UAS Registration Fee $85.7 $70.0

Time Resource Opportunity Costs 

 Applicants Travel Time $151.1 $125.2

 Knowledge Test Application $54.7 $45.3

 Physical Capability Certification $10.0 $8.9

 Knowledge Test Time $656.2 $543.7

 Small UAS Registration Form $110.7 $90.2

 Change of Name or Address Form $7.5 $6.2

 Knowledge Test Report $154.9 $128.5

 Pre-flight Inspection Not quantified

 Accident Reporting Minimal costs

Government Costs

 TSA Security Vetting $1,026.5 $906.9

 FAA - sUAS Operating Certificate $39.6 $35.0

 FAA - Registration $394.3 $321.8

Total Costs $5,825.8 $4,905.3

Using the local travel time – personal hourly wage rate, the total costs would be 14.4 percent 

(1.0 – (5,825.8 / $6,803.1)) less than using the hourly wage rates for small UAS operators and 

applicants from the “Assumption and Data” section. 
71

Appendix 5 – Alternatives the FAA Considered 

This section discusses the alternatives the FAA considered during the course of this 

rulemaking. This proposed rule would treat the entire spectrum of operations that would be 

subject to this rule in a similar manner by imposing the least stringent possible regulatory 

burdens that would ensure an acceptable level of safety of the NAS because small UAS

operations pose the least amount of risk. 

Alternative 1.

The FAA considered allowing small unmanned aircraft to conduct external-load 

operations and to tow other aircraft or objects. However, these operations involve a greater level 

of public risk due to the dynamic nature of external-load configurations and inherent risks 

associated with the flight characteristics of a load that is carried, or extends, outside the aircraft 

fuselage and may be jettisonable. These types of operations may also involve evaluation of the 

aircraft frame for safety performance impacts, which may require airworthiness certification. 

This type of an evaluation would be beyond the scope of the flexibility provided for in section 

333. 

As a result of the FAA’s decision to limit this rulemaking to lower-risk small UAS 

operations, this proposed rule would not apply to small unmanned aircraft conducting externalload operations or to small unmanned aircraft towing another aircraft or object. 
72

Alternative 2.

The FAA also considered whether to further subdivide small UAS into different 

categories of unmanned aircraft that would be regulated differently based on their weight, 

operational characteristics, and operating environment. After extensive deliberation, the FAA 

ultimately determined that such a regulatory framework was too complex and burdensome for 

both the public and the FAA. The FAA then examined the entire small UAS category of aircraft 

(unmanned aircraft weighing less than 55 pounds) and determined that appropriate operational 

risk mitigations could be developed to allow the entire category of small UAS to avoid 

airworthiness certification. 

Furthermore, the FAA decided to also substantially simplify the operational limitations 

and airman (operator) certification requirements in a manner that would equally accommodate all 

types of small UAS business users with the least amount of complexity and regulatory burden. 

The FAA believes that treating small UAS as a single category without airworthiness 

certification would accommodate a large majority of small UAS businesses and other nonrecreational users of UAS. The operational limits in this proposed rule would mitigate risk 

associated with small UAS operations in a way that would provide an equivalent level of safety 

to the NAS with the least amount of burden to business and other non-recreational users of UAS 

of even the smallest UAS.

Alternative 3.

The FAA is also considering further segmenting the small UAS that would be subject to 

this proposed rule and creating a set of regulatory provisions that would be applicable 

specifically to a “micro UAS” subcategory of small UAS operations. This classification would 
73

be based on the UAS ARC’s recommendations, as well as approaches adopted in other countries 

that have a separate set of regulations for micro UAS. 

The micro UAS provisions that the FAA is considering would apply to operations that fit 

the following parameters:

• The unmanned aircraft used in the operation would weigh no more than 4.4 

pounds (2 kilograms);

• The unmanned aircraft would be made out of frangible materials that break, 

distort, or yield on impact so as to present a minimal hazard to any person or object that the 

unmanned aircraft collides with;

• During the course of the operation, the unmanned aircraft would not exceed an 

airspeed of 30 knots;

• During the course of the operation, the unmanned aircraft would not travel higher 

than 400 feet AGL;

• The unmanned aircraft would be flown within visual line of sight; first-person 

view would not be used during the operation; and the aircraft would not travel farther than 1,500 

feet away from the operator;

• The operator would maintain manual control of the flight path of the unmanned 

aircraft at all times, and the operator would not use automation to control the flight path of the 

unmanned aircraft;

• The operation would be limited entirely to Class G airspace; and

• The unmanned aircraft would maintain a distance of at least 5 nautical miles from 

any airport.
74

The operational parameters discussed above may provide significant additional safety 

mitigations. Specifically, a very light (micro) UAS operating at lower altitudes and at lower 

speeds, that is made up of materials that break or yield easily upon impact, may pose a much 

lower risk to persons, property, and other NAS users than a UAS that does not operate within 

these parameters, Additionally, limiting the micro UAS operation entirely to Class G airspace, 

far away from an airport, and in close proximity to the operator (as well as limiting the 

unmanned aircraft’s flight path to the operator’s constant manual control) would significantly 

reduce the risk of collision with another aircraft. Accordingly, because the specific parameters 

of a micro UAS operation that the FAA is considering would provide additional safety mitigation 

for those operations, this classification would allow micro UAS to operate directly over people 

not involved in the operation. 

Under the micro UAS classification, the operator of a micro UAS would also be able to 

operate using a UAS airman certificate with a different rating (an unmanned aircraft operator 

certificate with a micro UAS rating) than the airman certificate that would be created by 

proposed part 107. No knowledge test would be required in order to obtain an unmanned aircraft 

operator certificate with a micro UAS rating; instead, the applicant would simply submit a signed 

statement to the FAA stating that he or she has familiarized him or herself with all of the areas of 

knowledge that are tested on the initial aeronautical knowledge test that is proposed under part 

107.

The FAA invites commenters to submit data and any other supporting documentation on 

the issue of whether the micro UAS classification is a viable course of action that should be 

included in the final rule. FAA also invites comments as to whether the ability to operate an 

unmanned aircraft over a person and the ability to obtain an airman certificate without a 
75

knowledge test provide sufficient operational flexibility to actually incentivize someone to 

operate under the micro UAS framework. Finally, the FAA invites comments, with supporting 

documentation, showing the costs and benefits of a micro UAS classification in the final rule. 

The FAA notes, however, that due to statutory constraints, the FAA cannot eliminate the 

requirement to hold an airman certificate and register the unmanned aircraft even if it were to 

adopt a micro UAS classification in the final rule.

During the course of this rulemaking, the FAA also received a petition for rulemaking 

from UAS America Fund LLC. This petition presented the FAA with an alternative approach to 

regulating micro UAS, complete with a set of regulatory provisions that would be specific to 

micro UAS operations along with an economic analysis of the costs and benefits. The FAA has 

not substantiated the costs and benefits in the petition for rulemaking.

Because the FAA was already in the process of rulemaking at the time this petition was 

filed, pursuant to 14 CFR 11.73(c), the FAA will not treat this petition as a separate action, but 

rather, will consider it as comment on this rulemaking. Any comments received in response to 

the proposals in the petition will be considered as part of the final rule.

Alternative 4.

The FAA considered proposing that a UAS operator be permitted to exercise his or her 

see-and-avoid responsibilities through technological means, such as onboard cameras. At this 

time, technology that could provide an acceptable substitute for direct human vision in UAS 

operations has not been miniaturized to the extent that would allow it to be used in small UAS 

operations. Because there is no acceptable technological substitute for direct human vision in 

small UAS operations at this time, the FAA proposes to require, in §§ 107.31 and 107.37(a)(1), 
76

that the operator (and visual observer, if used) must be capable of maintaining a visual line of 

sight of the small unmanned aircraft throughout that aircraft’s entire flight with human vision 

that is unaided by any device other than spectacles or contact lenses. If a visual observer is not 

used, the operator must exercise this capability and maintain watch over the small unmanned 

aircraft during flight. Therefore, at this time, the FAA has decided against the alternative that a 

UAS operator be permitted to exercise his or her see-and-avoid responsibilities through 

technological means.

Alternative 5.

The FAA considered proposing to allow small UAS operations outside the hours of 

official sunrise and sunset, recognizing that this would integrate a greater quantity of small UAS 

operations into the NAS. The FAA notes that most small unmanned aircraft flights under this 

proposed rule would take place at low altitudes, and flying at night would limit the small UAS 

operator’s ability to see people on the ground and take precautions to ensure that the small 

unmanned aircraft does not pose a hazard to those people. Moreover, allowing small UAS 

operations outside of daylight hours would require equipage and certification requirements that 

are contrary to the FAA’s goal of a minimally burdensome rule for small unmanned aircraft. 

Therefore, at this time, the FAA has decided against this alternative.

Alternative 6.

The FAA also considered whether the vertical boundary should be set at a higher level

than 500 feet AGL. However, because most manned-aircraft operations can transit the airspace 

above the 500-foot level, UAS operations at that altitude would likely require greater levels of 
77

operator training, aircraft equipage, and some type of aircraft certification in order to avoid 

endangering other users of the NAS. Since these provisions would be contrary to the goal of this 

rulemaking, which is to regulate the lowest-risk small UAS operations while imposing a minimal 

regulatory burden on those operations, this proposed rule would not allow small UAS to travel 

higher than 500 feet. 

Alternative 7.

In addressing the issue of airworthiness for small UAS, the FAA considered several 

approaches, including requiring small UAS operators to comply with the existing inspection and 

maintenance requirements of this chapter. The FAA also considered requiring a separate permit 

to operate (PTO) in addition to aircraft registration and airman certification. A PTO would have 

required an applicant to adhere to requirements for airworthiness certification. 

After further consideration, the FAA decided that neither of these approaches is

proportionate to the risk posed by small UAS. The FAA notes that due to their light weight, 

small unmanned aircraft generally pose a significantly lower risk to people and property on the 

ground than manned aircraft. This relatively low risk is mitigated even further by the see-andavoid and loss-of-positive-control provisions of this proposed rule, which are discussed above. 

Accordingly, based on existing information, the FAA believes that requiring small UAS 

operators to conduct inspection and maintenance of the small UAS pursuant to the existing 

regulations of part 43, or to obtain a PTO, would not result in significant safety benefits. As a 

result, this proposed rule would not require small UAS compliance with part 43 or the 

application for or issuance of a PTO. 
78

Alternative 8.

The FAA considered proposing to require an individual to obtain a commercial pilot

certificate with a UAS type endorsement before operating a small UAS. Issuance of such a 

certificate would require that the applicant obtain a Class II airman medical certificate, pass an 

aeronautical knowledge test, and demonstrate flight proficiency and aeronautical experience with 

a certificated flight instructor. However, given the lower level of public risk posed by small 

UAS operations, the FAA decided that imposing such requirements would be unduly 

burdensome to small UAS operators. Moreover, as explained in further detail in preamble, the 

FAA believes that the training, testing, proficiency and experience requirements for obtaining a 

commercial pilot license have limited relevance to the nature of small UAS operations. 

Alternative 9.

The FAA also considered whether to offer an option for the knowledge test to be 

administered online. However, in examining this approach the FAA ultimately determined that 

there would be significant risk in the integrity of a knowledge test becoming compromised if that 

test was to be administered outside of a controlled environment. This could be accomplished 

through someone copying and circulating the test questions, using unauthorized materials to take 

the test, or even taking the test for another person. Using the identity of another person to take 

the knowledge test may also allow an applicant to manipulate the security vetting procedures that 

take place once the applicant’s identity is verified.
79

In addition, the FAA determined that it would be more difficult to safeguard the 

personally identifiable information (PII) of a test-taker that is collected online rather than inperson at a knowledge testing center. Accordingly, the FAA has decided against proceeding 

with an online test-taking option.