State pursues drone zone
Oregon wants a major slice of the civilian drone business.
The industry is poised to explode after 2015 when the Federal Aviation Administration begins to allow drones in civilian airspace.
Experts predict the industry could grow to $11.4 billion annually in the next 10 years as drones are used for everything from monitoring polar bears and ice flows to tracking whales, forest fires and urban creep.
To meet the 2015 deadline, the FAA is expected to establish six drone test sites, dedicated air spaces where engineers and pilots can test unmanned aircraft and equipment free of surrounding air traffic. Those activities are currently confined to military bases and air spaces.
Drone-related businesses are expected to cluster around the test sites, which means Oregon will have plenty of competition for one of the coveted sites.
Oregon’s bid is supported by both of its United States senators.
Gov. John Kitzhaber packed a $3 million grant request to fund the test site in his budget proposal to the 2013 Legislature.
“The growth dynamic seems pretty dynamic,” said John Doussard, a policy analyst for the Oregon Innovation Council, which asked Kitzhaber for the budget allocation.
Doussard estimates a test site would generate 461 jobs, $28 million in payroll and $75 million in economic activity shared by both urban and rural counties.
“It’s sort of this idea that if you build it, they will come,” said Tom Towslee, spokesman for Sen. Ron Wyden, D.-Oregon.
Wyden was instrumental in getting the drone testing areas included in the last FAA authorization bill.
The federal agency is expected to solicit test site proposals next spring after delaying the process nearly a year over privacy concerns.
Towslee said Wyden is motivated by the region’s rich aviation history, diverse landscape and a booming drone industry that already employs some 1,000 people in the Columbia River Gorge alone
“Oregon has a very vibrant and successful drone testing and manufacturing industry,” he said. “It’s a big deal.”
The Hood River cluster is centered on Insitu Inc., the unmanned aircraft division of The Boeing Co.
Insitu employs about 800 people in the Gorge. It disclosed more than $400 million in revenue in 2010, chiefly from sales to the military.
Oregon State University, where researchers already use drones for aerial surveys, is pushing the campaign, which originated with Economic Development for Central Oregon.
Other supporters include the Pacific Northwest Defense Coalition, an unmanned aircraft industry association, and private businesses eager to test their gear at home instead of remote military bases.
Rick Spinrad, vice president for research at OSU, said Oregon is a logical outlet for drone testing. OSU researchers already use drones to monitor beach erosion and forest conditions. The region boasts a test pilot’s dream of flying conditions. It has desert, forest, mountains, coast, urban and rural settings.
Its test site pitch will likely offer multiple sites to bolster the strength of the bid, though the Bend-Redmond area and the Warm Springs reservation are among the most-mentioned locations.
“We will be competing with some very strong other regions on this,” Spinrad said.
The campaign to turn Oregon into the drone capital of the U.S. began in central Oregon, where business leaders sought ways to replace jobs lost in the general aviation manufacturing industry during the recession. The industry is a shadow of its former self, said Roger Lee, executive director for Economic Development for Central Oregon.
Aviation manufacturing was a major local industry, employing 900 people in Deschutes County in 2007, according to the Oregon Employment Department.
Lee estimates the industry has cut back by at least four-fifths and needs a new opportunity that builds on its aviation history. The emerging drone industry fits the bill.
“We believe there are some great opportunities out here where no one lives,” he said.
The proposal has eager supporters in private industry as well.
Northwest UAV Propulsion Systems launched in 2009 to manufacture small engines for drones, providing a U.S. manufacturer for a supply chain once centered in Europe and Asia. The company has grown to 100 employees. It recently moved to larger quarters, a former RV dealership in McMinnville, said Joe Gibbs, business development manager.
Gibbs said Northwest UAV would prefer to test its equipment at a local site rather than travel to the military bases it now uses. He said other companies, including suppliers to the drone industry, will want to be near a test site.
“If we have a test site, these companies will relocate,” he said. “The nice thing about this industry is it’s not easily off-shored.”
Ben Berry, a tech and aviation veteran, is one of the industry’s Oregon dreamers. He started AirShip Technologies Group in his Lake Oswego home 18 months ago to develop Airship V2, a 4.4-pound drone designed to aid law enforcement and fire fighters. Selling drones to first responders could be a billion dollar business, he said.
He hopes to sign a deal to manufacture the V2 in Oregon and begin selling next May. Berry said he currently travels to California to test his equipment.
“It would be a lot easier if it were in the Pacific Northwest,” he said. “From a collegial and collaborative standpoint, the cluster is very important to me.”