We’ve moved! Check out our new website at www.lbbizjournal.com


Analysis Losing FAA Drone Testing Bid Hurts Growing California Industry

By Tiffany L. Rider - Editor

January 21, 2014 – Viewed as a front-runner in a bid for developing unmanned aircraft systems (UAS) research sites for the Federal Aviation Administration (FAA), California surprisingly was not selected among the six public entities to become a testing site operator.

The number of UAS manufacturers based in California – including 3D Robotics and General Atomics Aeronautical Systems, both in San Diego, Advanced Defense Technologies in Anaheim, AeroVironment in Monrovia and Swift Engineering in San Clemente – seemed to position the Golden State to make a slam-dunk.

The Business Journal asked FAA Pacific Division Public Affairs Manager Ian Gregor to explain why California was passed over in this bid. He responded via e-mail, “We reviewed 25 proposals from public entities in 24 states. All the proposals were quality submissions, and the FAA reviewed them very carefully. We chose the six proposals that best meet our research goals. The FAA considered geographic diversity, climatic diversity, location of ground infrastructure, research needs, airspace use, safety, aviation experience, risk and economic impact.”

Losing FAA Drone Testing Bid

This unmanned aircraft system (UAS), an MQ-9 Reaper of the U.S. Customs and Border Protection agency,
exemplifies the potential domestic use of drone technology manufactured in California.
General Atomics Aeronautical Systems based in San Diego designed this particular system. The U.S. Air Force, Navy,
Central Intelligence Agency, National Aeronautics and Space Administration and others
also use the MQ-9 Reaper, which has acquired the name “hunter-killer”
for its tactical unmanned combat capabilities.
(Photograph from the Federal Aviation Administration’s Certification of Authorization Sponsors database)

According to California Governor’s Office of Business and Economic Development (GO-Biz) spokesperson Brook Taylor, the state military council “offered its strong support for a federal drone testing site in California and GO-Biz worked directly with both local applicants to strengthen the state’s bids.” One applicant is based in Ventura County, the other in Kern County. “Because California is already a center of innovation for aviation technologies, we remain well positioned to attract further research and development investment moving forward.”

According to the Federal Aviation Administration’s Certification of Authorization Sponsors database, the U.S. Air Force, Navy, Customs and Border Protection, Central Intelligence Agency, National Aeronautics and Space Administration and others have used a variety of UAS, including the MQ-9 Reaper, manufactured by General Atomics Aeronautical Systems. As UAS industry is growing, private industry is exploring uses that could include monitoring the environment and wildlife as well as providing support for oil spill emergency response crews.

Republican Assemblymember Jeff Gorell of Camarillo authored a bill last year trying to grow a deal with the UAS industry in California. The bill, AB 1326, would have provided tax credits for UAS manufacturers in the state. According to Doug Lorenz, communications director for Gorell, the FAA test site bid would have provided some benefit to an industry that provides quality jobs. “It was just one more opportunity that could be offered to these companies,” Lorenz told the Business Journal. “During the time the FAA was investigating drone airspace, companies could have used that test program for their own research and development. It would have encouraged businesses to do testing. . . . We still have very large technology companies that do work in that area. That’s why it seemed to be a natural fit.” Introduced last February, the bill remains held under submission in appropriations.

According to Rob Lapsley, president of the California Business Roundtable, the state’s long history of producing cutting-edge aerospace technology provided a significant amount of middle-class jobs that have been disappearing since the 1990s.

“It would be a very clear sign if the legislature stood up, as Assembly Gorell did with his bill, to ask: What can we specifically do to keep these jobs in California? The governor did with Boeing (in the bid for the 777x program), but the legislature hasn’t with space exploration and UAS . . . . California needs those jobs.”

Though the governor's office claimed to have made its best effort to win the FAA bid, there was no evidence of a collective rally for UAS testing made by the state legislature. On Capitol Hill, however, California Sen. Dianne Feinstein publicly stated her view on UAS at a hearing of the U.S. Senate Committee on Commerce, Science and Transportation held January 15.

“I believe civilian drone technology, much of which has been developed in California, has great potential for both beneficial use and for job creation,” Feinstein said. “But the unique capabilities of the drone bring with it significant risks, most notably related to privacy and public safety. I believe we should proceed with caution, and that Congress must act to set reasonable rules to protect the American people and ensure that this industry can reach its potential.”

California as a state has lost about 630,000 manufacturing jobs since 2001, according to Gino DiCaro, vice president of communications for the California Manufacturers and Technology Association. The average manufacturing job wage is about $76,000 in California, and the state has been lagging the nation in manufacturing job growth since 2010, he told the Business Journal. Research and scaling manufacturing jobs, including those associated with testing UAS, he said, is what California needs.

“These are critical jobs that we need to both retain and grow in California,” DiCaro said. “GO-Biz is doing everything they can to retain and grow these industries. They gave it their best effort with the FAA drone-testing program. That’s a good sign. It’s unfortunate that the Feds had this in their hands and sent it to other states.”

Taylor noted that a 2012 study commissioned by the Aerospace Industries Association cited California as the top state in the country for manufacturing specialized equipment, along with search, detection, navigation and guidance systems. The study also cites Washington as having the highest employment in aerospace products and parts manufacturing.

“When new industries start to emerge, it’s critical we grow the manufacturing sector as a whole in California going forward,” DiCaro said. “We’ve got to make sure we get people to invest here and scale up here.”