State departments of transportation (DOTs) and local agencies are utilizing unmanned aircraft systems (UAS) in more day-to-day operations such as asset inspections, operations, traffic incident management, mapping, bridge and structure inspections, geographic information system (GIS), environmental requirements, and a variety of other uses. However, there have been different challenges of integrating UAS operational capabilities into U.S. national airspace system. These unique challenges are related to (1) overlapping jurisdictional decision-making, funding, regulations and rules, and infrastructure development; (2) identifying roles and responsibilities, areas of overlap, and gaps in responsibilities; and (3) undefined or unaddressed issues that need work and options for mediating conflicting roles and responsibilities. Additionally, external developments on package delivery via UAS and advanced air mobility (AAM) raise issues about their safe operation over state and local rights-of-way and needed ground infrastructure and air space management. There is a need to aid state DOTs and local agencies in addressing the operational challenges and issues, and develop a roadmap for implementation of UAS operational capabilities.