A pioneering Chicago aerial photography company has agreed to pay the Federal Aviation Administration $200,000 to settle charges it violated airspace regulations with its drones.
SkyPan International, which has been using drones for 20 years to shoot aerial views for proposed high-rise developments, had been facing a $1.9 million penalty for what the FAA said were 65 unauthorized drone flights in New York City and Chicago between 2012 and 2014.
Mark Segal, who launched SkyPan in 1988, agreed to the settlement Tuesday, ending a yearlong legal battle with the FAA that may have implications for the booming commercial drone industry.
“We’ve suffered enough and I just wanted to get it off our back at this point,” Segal, 60, said Wednesday.
In October 2015, the FAA proposed the record $1.9 million fine against Segal and SkyPan for allegedly violating regulations in the congested airspace over New York City and Chicago. The flights occurred before the specific regulations governing commercial drone operations were adopted by the FAA in June 2016.
“There really wasn’t any law when we were shooting,” Segal said.
SkyPan also agreed to pay an additional $150,000 if it violates FAA regulations in the next year, and is subject to an additional $150,000 fine if it fails to comply with the terms of the agreement.
Under the current FAA regulations, commercial operators must register each drone, and adhere to restrictions such as the speed, altitude, time of day and flight path.
There are 47,329 individual commercial drones registered with the FAA, and the industry is taking off, according to FAA spokesman Les Dorr. Beyond aerial photography, he said commercial applications include everything from insurance claims to using drones to inspect bridges.
Last month, Amazon tested commercial drone package delivery in England.
“It’s almost like somebody comes up with a new use for the technology almost every week,” Dorr said Wednesday.
The FAA also oversees recreational drones under separate model aircraft regulations, and has required recreational owners to register since December 2015. There are 649,554 owners registered with the FAA, which translates to about 1.6 million recreational drones across the U.S., Dorr said.
Segal has a fleet of three 5-foot miniature helicopters, which weigh up to 19 pounds each. He shoots two to five projects per month and works with a long list of major real estate developers looking to get their high-rise projects off the ground. The 360-degree aerial shots provide “real views” that help developers plan their buildings, Segal said.
SkyPan’s annual billing is between $1 million and $2 million, Segal said, but business has been hurt by the FAA allegations.
“It encouraged our competitors to try to swoop in and take … our clients away,” Segal said. “There’s no doubt it affected our business.”
SkyPan recently completed aerial photography for a new transit-oriented apartment building being developed by Vequity at 1920 N. Milwaukee Ave. in the Bucktown/Logan Square area.
Segal’s first client was Sam Zell, the billionaire real estate developer, who hired the photographer to get aerial shots of several Chicago developments.
Segal originally used full-size manned helicopters to take the aerial shots, but began using drones in 1996, and switched to them exclusively in 2002.
One of Segal’s more prominent clients is the Trump Organization, which hired SkyPan in 2003 to shoot aerial views for the Trump Tower development in Chicago. SkyPan went on to do work for Trump in Las Vegas and New York City.
“They were very happy with what we did in Chicago,” Segal said. “It really helped them with the planning and layout of the building by examining the views in advance.”
rchannick@chicagotribune.com
Twitter @RobertChannick
