[Federal Register Volume 61, Number 224 (Tuesday, November 19, 1996)]
[Proposed Rules]
[Pages 58799-58800]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-29572]


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DEPARTMENT OF JUSTICE

28 CFR Part 100

RIN 1105-AA39


Implementation of Section 109 of the Communications Assistance 
for Law Enforcement Act: Request for Comment on ``Significant Upgrade'' 
and ``Major Modification''

AGENCY: Federal Bureau of Investigation, DOI.

ACTION: Advance notice of proposed rulemaking.

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SUMMARY: This notice solicits from the telecommunication industry 
information on and suggestions for dealing with the terms ``significant 
upgrade'' and ``major modification'' as these terms are used in section 
109 of the Communications Assistance for Law Enforcement Act (CALEA). 
Specifically, the FBI seeks public comment on these terms with regard 
to CALEA compliancy and cost reimbursement under CALEA section 109.

DATES: Comments must be received on or before December 19, 1996.

ADDRESSES: Comments should be submitted to the Telecommunications 
Contracts and Audit Unit, Federal Bureau of Investigation, P.O. Box 
221286, Chantilly, VA 20153-0450, Attention: CALEA FR Representative. 
See Section D of the Supplementary Information for further information 
on electronic submission of comments.

FOR FURTHER INFORMATION CONTACT: Walter V. Meslar, Unit Chief, 
Telecommunications Contracts and Audit Unit, Federal Bureau of 
Investigation, P.O. Box 221286, Chantilly, VA 20153-0450, telephone 
number (703) 814-4900.

SUPPLEMENTARY INFORMATION:

A. General Background

    Recent and continuing advances in telecommunications technology and 
the introduction of new digitally-based services and features have 
impaired the ability of federal, state, and local law enforcement 
agencies to fully and properly conduct various types of court-
authorized electronic surveillance. Therefore, on October 25, 1994, the 
President signed into law the Communications Assistance for Law 
Enforcement Act (CALEA) (Public Law 103-414, 47 U.S.C. 1001-1010). This 
law requires telecommunications carriers, as defined in CALEA, to 
ensure that law enforcement agencies, acting pursuant to court order or 
other lawful authorization are able to intercept communications 
regardless of advances in telecommunications technologies.
    Under CALEA, certain implementation responsibilities are conferred 
upon the Attorney General; the Attorney General has, in turn, delegated 
responsibilities set forth in CALEA to the Director, FBI, or his 
designee, pursuant to 28 CFR 0.85(o). The Director, FBI, has designated 
the Telecommunications Industry Liaison Unit of the Information 
Resources Division and the Telecommunications Contracts and Audit Unit 
of the Finance Division to carry out these responsibilities.
    One of the CALEA implementation responsibilities delegated to the 
FBI is the establishment, after notice and comment, of regulations 
necessary to effectuate timely and cost-efficient payment to 
telecommunications carriers for certain modifications made to 
equipment, facilities and services (hereafter referred to as 
``equipment'') to make that ``equipment'' compliant with CALEA.\1\ 
Section 109(b)(2) of CALEA authorizes the Attorney General, subject to 
the availability of appropriations, to agree to pay telecommunications 
carriers for additional reasonable costs directly associated with 
making the assistance capability requirements found in section 103 of 
CALEA reasonably achievable with respect to ``equipment'' installed or 
deployed after January 1, 1995, in accordance with the procedures 
established in section 109(b)(1) \2\ of CALEA. Section 104(e) of CALEA 
authorizes the Attorney General, subject to the availability of 
appropriations, to agree to pay telecommunications carriers for 
reasonable costs directly associated with modifications of any of a 
carrier's systems or services, as identified in the Carrier Statement 
required by CALEA section 104(d), which do not have the capacity to 
accommodate simultaneously the number of interceptions, pen registers, 
and trap and trace devices set forth in the Capacity Notice(s) 
published in accordance with CALEA section 104. Finally, section 109(a) 
of CALEA authorizes the Attorney General, subject to the availability 
of appropriations, to agree to pay telecommunications carriers for all 
reasonable costs directly associated with the modifications performed 
by carriers in connection with ``equipment'' installed or deployed on 
or before January 1, 1995, to establish the capabilities necessary to 
comply with the assistance capability requirements found in section 103 
of CALEA. However, reimbursement under section 109(a) of CALEA is 
modified by the requirements of section 109(d), which states:

    \1\ CALEA Sec. 109(e).
    \2\ CALEA Section 109(b)(1) sets forth the procedures and the 
criteria the Federal Communications Commission (FCC) will use to 
determine if the modifications are ``reasonably achievable''.
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    If a carrier has requested payment in accordance with procedures 
promulgated pursuant to subsection (e) [Cost Control Regulations], 
and the Attorney General has not agreed to pay the 
telecommunications carrier for all reasonable costs directly 
associated with modifications necessary to bring any equipment, 
facilities, and services installed or deployed on or before January 
1, 1995, into compliance with the assistance capability requirements 
of section 103, such equipment, facility, or service shall be 
considered in compliance with the assistance capability requirements 
of section 103, until the equipment, facility, or service is 
replaced or significantly upgraded or otherwise undergoes major 
modification.

(emphasis added).

While this section deals specifically with a carrier's compliance with 
CALEA, the phrase ``replaced or significantly upgraded or otherwise 
undergoes major modification'' (hereafter referred to as ``significant 
upgrade or major modification''), depending on a carrier's actions 
after January, 1995, also has a direct bearing on the eligibility for 
reimbursement of some ``equipment'' installed or deployed on or before 
January 1, 1995.\3\
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    \3\ ``Significant upgrade or major modification'' also appears 
in CALEA Sec. 108(c)(3)(B) with regard to the limitations placed 
upon the issuance of enforcement orders under 18 U.S.C. 2522.
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B. Proposed Cost Reimbursement Rule

    As required by CALEA Sec. 109(e), the FBI published a proposed 
CALEA cost reimbursement rule (NPRM) for notice and comment in the 
Federal Register on May 10, 1996 (61 FR 21396). The NPRM proposed 
procedures which telecommunications carriers would follow in order to 
receive reimbursement under Sections 109(a), 109(b)(2) and 104(e) of 
CALEA, as discussed above. Specifically, the NPRM set forth the means 
of

[[Page 58800]]

determining allowable costs, reasonable costs, and disallowed costs. 
Furthermore, it established the requirements carriers must meet in 
their submission of cost estimates and requests for payment to the 
Federal Government for the disbursement of CALEA funds. Finally, the 
NPRM sought to ensure the confidentiality of trade secrets and to 
protect proprietary information from unnecessary disclosure.
    Of particular interest for the purposes of this Advance Notice of 
Proposed Rule Making (ANPRM) is section 100.11(a)(1) of the NPRM, which 
included in the costs eligible for reimbursement under section 109(e) 
of CALEA:

    All reasonable plant specific costs directly associated with the 
modifications performed by carriers in connection with equipment, 
facilities, and services installed or deployed on or before January 
1, 1995, to establish the capabilities necessary to comply with 
section 103 of CALEA, until the equipment, facility, or service is 
replaced or significantly upgraded or otherwise undergoes major 
modifications . . .

(emphasis added).

    In response to the NPRM, the FBI received comments from 16 
representatives of the telecommunications industry, including wireline 
and wireless carriers and associations. Of the 16 sets of comments 
received on the proposed rule, half requested that the FBI define 
``significant upgrade or major modification'' as used in 
Sec. 100.11(a)(1) of the NPRM.
    Given the dynamic nature of the telecommunications industry and the 
potential impact on eligibility for reimbursement, the FBI acknowledges 
that ``significant upgrade or major modification'' must be defined. 
However, this issue affects only those carriers who have made some form 
of modification, other than routine maintenance, or upgrade to their 
``equipment'' which was installed or deployed on or before January 1, 
1995. The reimbursement eligibility of ``equipment'' which has 
undergone no modification or upgrade since January 1, 1995 is not 
affected by this definition. In addition, ``significant upgrade or 
major modification'' does not pertain to cases of reimbursement for 
capability modifications which have been deemed not reasonably 
achievable by the FCC under CALEA section 109(b)(2) or to reimbursement 
for capacity modifications under CALEA section 104(e). Therefore, given 
that many of the potential reimbursement scenarios allowed by CALEA, 
and, therefore, by the NPRM, are not affected by the definition of 
``significant upgrade and major modification,'' the FBI has elected to 
handle this issue separately in order to expedite the CALEA 
implementation process. This decision is in both the best interests of 
the government and of the carriers given that CALEA funds are now 
available to begin the reimbursement effort.\4\ Severing the 
``significant upgrade or major modification'' issue from the NPRM for 
separate consideration will allow the FBI to go forward in finalizing 
the rest of the NPRM, thereby allowing the FBI as soon as possible to 
begin reimbursing those carriers who have made no modifications or 
upgrades since January 1, 1995. With regard to the rest of the NPRM, 
the FBI has considered all comments submitted and anticipates 
publication of the final rule for CALEA cost reimbursement (exclusive 
of a definition of ``significant upgrade or major modification'') in 
the first quarter of calendar year 1997.
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    \4\ Public Law 104-208, Item 28: (16) ``Telecommunications 
Carrier Compliance Fund.''
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C. ``Significant Upgrade'' and ``Major Modification''

    In addition to the need for expedition in finalizing the CALEA cost 
reimbursement rule, the FBI has determined that it is in the best 
interests of all parties concerned that the FBI solicit further input 
from the telecommunications industry and the general public in order to 
resolve this issue. Therefore, the FBI requests that telecommunications 
carriers and other interested parties submit potential definitions of 
``significant upgrade or major modification'' in response to this 
ANPRM. Committed to the consultative process and to maintaining an on-
going dialogue with the telecommunications industry, the FBI seeks to 
draw on the expertise of that industry so that it may gain an 
understanding of the range of options available with regard to 
``significant upgrade or major modification.''
    It should be noted that the comment period for this ANPRM is 30 
days. The FBI has elected to use a reduced comment period in order to 
expedite the CALEA implementation process, particularly with regard to 
``significant upgrade and major modification.'' Given the concerns 
expressed by the commenters on NPRM, the FBI has reason to believe that 
the telecommunications industry wishes for a rapid resolution to the 
issue.
    Once the FBI has received comments in response to the ANPRM, it 
will determine the best means of promulgating the definition of 
``significant upgrade and major modification.'' Furthermore, after 
making this determination and developing a definition, the FBI will 
address the comments received in some form in the Federal Register at a 
later date.

D. Electronic Submission of Comments

    While printed comments are welcome, commenters are encouraged to 
submit their responses on electronic media. Electronic documents must 
be in WordPerfect 6.1 (or earlier version) or Microsoft Word 6.0 (or 
earlier) format. Comments must be the only file on the disk. In 
addition, all electronic submissions must be accompanied by a printed 
sheet listing the name, company or organization name, address, and 
telephone number of an individual who can replace the disk should it be 
damaged in transit. Comments under 10 pages in length can be faxed to 
the Telecommunications Contracts and Audit Unit, Attention: CALEA FR 
Representative, fax number (703) 814-4730.

(Authority: 47 U.S.C. 1001-1010; 28 CFR 0.85(o))

    Dated: November 12, 1996.
Louis Freech,
Director, Federal Bureau of Investigation, Department of Justice.
[FR Doc. 96-29572 Filed 11-18-96; 8:45 am]
BILLING CODE 4410-02-M