12 March 1998
Source: http://www.access.gpo.gov/su_docs/aces/aaces002.html

-------------------------------------------------------------------------

[Federal Register: March 12, 1998 (Volume 63, Number 48)]
[Notices]
[Page 12217-12310]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr12mr98-122]

[[Page 12217]]

_______________________________________________________________________

Part III

Department of Justice

_______________________________________________________________________

Federal Bureau of Investigation

_______________________________________________________________________

Implementation of Section 104 of the Communications Assistance for Law
Enforcement Act; Notice

[[Page 12218]]

DEPARTMENT OF JUSTICE

Federal Bureau of Investigation


Implementation of Section 104 of the Communications Assistance
for Law Enforcement Act

AGENCY: Federal Bureau of Investigation (FBI).

ACTION: Final notice of capacity.

-----------------------------------------------------------------------

SUMMARY: The FBI is providing the Final Notice of the requirements for
actual and maximum capacity for the interception of the content of
communications and call-identifying information that telecommunications
carriers may be required to effect to support law enforcement's
electronic surveillance needs, as mandated in section 104 of the
Communications Assistance for Law Enforcement Act (CALEA) (Public Law
103-414, 47 U.S.C. 1001-1010). On October 16, 1995, the FBI published
an Initial Notice of Capacity for comment (60 FR 53643); and on
November 9, 1995, the comment period was extended until January 16,
1996. After reviewing the comments received, the FBI published the
Second Notice of Capacity on January 14, 1997, for comment (62 FR
1902). Comments were accepted on the Second Notice of Capacity through
March 15, 1997. After reviewing the comments received, the FBI is
issuing this Final Notice of Capacity.

DATES: Effective Date: March 12, 1998.
    Compliance Dates:
    1. Carrier Statement Submission Compliance: September 8, 1998.
    2. Capacity Compliance: March 12, 2001.

FOR FURTHER INFORMATION: Contact the CALEA Implementation Section,
Federal Bureau of Investigation (FBI), P.O. Box 220450, Chantilly,
Virginia 20153-0450 or call (800) 551-0336. Please refer to your
question as a capacity notice question. The FBI has made this Final
Notice of Capacity, as well as its associated appendixes, available on
its Internet homepage (http://www.fbi.gov).

I. Background

A. Purpose of CALEA

    On October 25, 1994, President Clinton signed into law the
Communications Assistance for Law Enforcement Act (CALEA). Its
objective is to make clear a telecommunications carrier's duty to
cooperate with law enforcement with regard to electronic surveillance-
related interceptions for law enforcement purposes. (For purposes of
this notice, the word ``interception'' is used to refer to either the
interception of call content or call-identifying information.) CALEA
was enacted to preserve law enforcement's ability, pursuant to court
order or other lawful authorization, to access call content and call-
identifying information, including information from pen register and
traps and traces, in an ever-changing telecommunications environment.
On February 24, 1995, the Attorney General delegated management and
administration responsibilities of CALEA to the FBI (see 28 CFR
0.85(o)). The FBI is implementing CALEA on behalf of all Federal,
State, and local law enforcement.
    In 1968, when Congress statutorily authorized court-ordered
electronic surveillance, there were no technological limitations on the
number of interceptions that could be conducted. However, the onset of
new and advanced technologies has begun to erode the ability of the
telecommunications industry to support law enforcement's interception
needs. In an effort to preserve the ability to conduct interceptions,
which is a vital investigative tool, the Congress determined that
technological solutions must be employed, thereby necessitating greater
levels of assistance from telecommunications carriers.
    The intent of CALEA is to define and clarify the level of technical
assistance required from telecommunications carriers. CALEA does not
alter or expand law enforcement's fundamental statutory authority to
intercept communications. It simply seeks to ensure that, after law
enforcement obtains legal authority, telecommunications carriers will
have the necessary technical ability to fulfill their statutory
obligation to accommodate requests for assistance.

B. Capacity Notice Mandate

    Because many future interceptions will be effected through
equipment controlled by telecommunications carriers, CALEA obligates
the Attorney General to provide carriers with information they will
need (a) to be capable of accommodating the actual number of
simultaneous interceptions law enforcement might conduct as of October
25, 1998, and (b) to size and design their networks to accommodate the
maximum number of simultaneous interceptions that law enforcement might
conduct after October 25, 1998. (Although actual and maximum capacity
determinations represent estimates for October 25, 1998, and
thereafter, telecommunications carrier compliance with capacity
requirements is, by terms of CALEA, required 3 years after the
effective date of this Final Notice of Capacity.) These two information
elements are referred to in CALEA as ``actual'' and ``maximum''
capacity requirements. In accordance with section 104 of CALEA, the
FBI, which has been delegated CALEA implementation responsibilities
from the Attorney General, on behalf of Federal, State and local law
enforcement, must provide notice of estimated future actual and maximum
capacity requirements. The statute defines these requirements as
follows:

    For actual capacity: The actual number of communication
interceptions, pen registers, and trap and trace devices,
representing a portion of the maximum capacity, that the Attorney
General estimates that government agencies authorized to conduct
electronic surveillance may conduct and use simultaneously by the
date that is 4 years after the date of enactment of CALEA.
    For maximum capacity: The maximum capacity required to
accommodate all of the communication interceptions, pen registers,
and trap and trace devices that the Attorney General estimates that
government agencies authorized to conduct electronic surveillance
may conduct and use simultaneously after the date that is 4 years
after the date of enactment of CALEA.

    Although CALEA requires the Attorney General to estimate the actual
number of communication interceptions, pen registers, and trap and
trace interceptions that may be required simultaneously by the date
that is four years after the date of enactment of CALEA (or three years
after the effective date of this Final Notice of Capacity, whichever is
longer) and thereafter, the estimates should not be interpreted as
constituting the number of interceptions that law enforcement intends
to, or is planning to, conduct. The number of interceptions that will
actually be needed will be determined by active authorized law
enforcement investigations which require interception efforts.
    Under CALEA, telecommunications carriers are required to have an
actual capacity available for immediate use on the date that is 3 years
after the effective date of this Final Notice of Capacity. Maximum
capacity, on the other hand, is a capacity level that
telecommunications carriers must be able to accommodate
``expeditiously'' if law enforcement needs an increase in the future.
The time frame for ``expeditious'' expansion to maximum capacity was
not specified in CALEA. However, law enforcement typically maintains
ongoing liaison with telecommunications carriers serving their areas.
Such liaison will facilitate the needed technical capability and
capacity to be prearranged, thereby ensuring that the interception can
begin

[[Page 12219]]

as soon as the lawful authorization is received. Such liaison is
critical because electronic surveillance interceptions are by their
very nature time sensitive. Law enforcement considers 5 business days
from a telecommunications carrier's receipt of a court order to be a
reasonable period of time within which to permit an incremental
expansion up to the maximum capacity. This time frame is based on past
practice as to the time typically involved under existing procedures
used by law enforcement and telecommunications carriers to make
technical interception arrangements.
    The term ``expeditious,'' as used herein, applies to section 104
capacity requirements regarding incremental expansion up to the maximum
capacity. It should not be confused with ``expeditious access'' to call
content and call-identifying information as used in section 103 of
CALEA, which pertains to the assistance capability requirements.
    Law enforcement has interpreted the maximum capacity chiefly as a
requirement that telecommunications carriers will follow to determine a
capacity ceiling. This ceiling is intended to provide
telecommunications carriers with a stable framework for cost-
effectively designing future capacity into their networks. It also
would provide room for accommodating future interception-related
``worst-case scenarios.'' Establishing the maximum capacity will allow
telecommunications carriers to assist law enforcement during serious,
unpredictable emergencies requiring unusual levels of interception.
    Consistent with CALEA, this Final Notice of Capacity identifies the
number of simultaneous interceptions that a telecommunications carrier
should be able to accommodate in a given geographic area as of the date
that is 3 years after the effective date of this Final Notice of
Capacity and thereafter. An ``interception'' relates to accessing and
delivering all communications (call content) or call-identifying
information associated with the telecommunications service of the
subject specified in a court order or other lawful authorization. The
telecommunications service targeted for interception includes all of
the services and features associated with the subject's wireline/
wireless telephone number, or as otherwise specified in the court order
or lawful authorization.
    For a call content-based ``interception'', a carrier is responsible
for accessing and delivering all communications and call-identifying
information supported by the subject's telecommunications service. This
is the case regardless of the advanced services or features to which
the subject subscribes (e.g., call forwarding used to redirect a call);
and notwithstanding that the subject may be engaged in more than one
communication (e.g., a subject is engaged in a voice telephone call and
simultaneously sends a fax or data transmission, or a subject is
engaged with several (different) parties in a conference call and
simultaneously communicates with a non-conferenced party). For
interceptions of call-identifying information (e.g., pen registers and
trap and trace device-based interceptions), a carrier is responsible
for accessing and delivering all call-identifying information related
to the communications that is generated or received by the subject,
regardless of the advanced services or features to which the subject
subscribes.
    The fact that a subject utilizes advanced services and features as
part of his/her telecommunications service or is capable of sending or
receiving more than one communication simultaneously does not mean that
carrier access and delivery of each constitutes a separate
interception. Consequently, telecommunications carriers need to ensure
that, regardless of their solutions (which may be varied), the solution
permits access and delivery of all of the communications or call-
identifying information for each interception as specified by the
interception order. Because of this circumstance, and because CALEA
forbids the Government from dictating solutions, law enforcement will
be available to consult and work with carriers as they develop
solutions.
    In some instances a telecommunications carrier may be able to meet
the assistance capability requirements without modifying its equipment,
facilities, or services. As a practical matter, conventional methods of
effectuating interceptions of call content and call-identifying
information, such as loop extender technologies, may meet the
requirements of CALEA for some subjects of court-ordered interceptions,
depending on the types of services and features to which the subject
subscribes. Telecommunications carriers that presently meet these
requirements under the circumstances described above will be in
compliance until their equipment, facilities, or services are replaced
or significantly upgraded or otherwise undergo major modification.
Furthermore, telecommunications carriers that cannot meet the
assistance capability requirements may still be considered to be in
compliance if the Government does not agree to reimburse such carriers
for modifications to equipment, facilities, and services installed or
deployed on or before January 1, 1995. Such carriers will continue to
be in compliance with CALEA until such time as their equipment,
facilities, or services are significantly upgraded, replaced, or
otherwise undergo major modification.

C. Initial Notice of Capacity

    On October 16, 1995, law enforcement's proposed estimated future
actual and maximum capacity requirements were presented in an Initial
Notice of Capacity published in the Federal Register as mandated by
section 104 of CALEA. On November 9, 1995 the industry comment period
was extended until January 16, 1996. The Initial Notice and the
comments on it were summarized in Section V of the Second Notice of
Capacity, published in the Federal Register on January 14, 1997 (62 FR
1902).

D. Second Notice of Capacity

    Following the release of the Initial Notice of Capacity, law
enforcement consulted with telecommunications industry representatives,
privacy advocates, and other interested parties to receive feedback on
the method used to express estimated future actual and maximum capacity
requirements. This consultative process assisted law enforcement in
understanding the challenges facing the industry and others in applying
the capacity requirements. After deliberation, law enforcement refined
its approach of defining capacity requirements and issued a Second
Notice of Capacity, published in the Federal Register on January 14,
1997 (62 FR 1902) to more fully articulate estimated future actual and
maximum capacity requirements. Comments on the Second Notice of
Capacity were accepted through March 15, 1997. The comments and the
responses to the comments filed regarding the Second Notice of Capacity
are summarized in Section VII of this notice. After the publication of
the Second Notice of Capacity, law enforcement received comments and
recommendations from telecommunications industry representatives,
privacy advocates, and other interested parties on the method used to
express future actual and maximum capacity requirements.

E. Final Notice of Capacity

    This Final Notice of Capacity is being issued after careful
consideration of the submitted comments to the Second Notice of
Capacity. During a pre-publication review, the Government

[[Page 12220]]

determined that for some purposes this Final Notice of Capacity had the
force and effect of a rule, therefore certain administrative and
regulatory requirements needed to be met prior to publication. This
notice fulfills the obligations of the Attorney General under section
104(a)(1) of CALEA. As mandated by section 104(d), telecommunications
carriers have 180 days after the effective date of this Final Notice of
Capacity to submit a Carrier Statement to the Government identifying
any of their systems or services that do not have the interception
capacity set forth in this Final Notice of Capacity to accommodate
CALEA's section 103 requirements.
    CALEA applies to all telecommunications carriers as defined in
section 102(8). Capacity notices will eventually be issued covering all
telecommunications carriers. However, this Final Notice of Capacity
should be viewed as the first phase applicable to telecommunications
carriers offering services that are of most immediate concern to law
enforcement--that is, those telecommunications carriers offering local
exchange services and certain commercial mobile radio services,
specifically cellular service and personal communications service
(PCS). For the purpose of this notice, PCS is considered a service
operating in the licensed portion of the 2 GHz band of the
electromagnetic spectrum, from 1850 MHz to 1990 MHz. Telecommunications
carriers offering local exchange services are referred to hereafter in
this notice as ``wireline'' carriers, and telecommunications carriers
offering cellular and PCS services are referred to as ``wireless''
carriers.
    Generally speaking, resellers of telecommunications services
(``resellers'') lease some portion of a host carrier's facilities which
allows the transmission or switching of wireline, wireless or other
electronic communications. Resellers holding themselves out for hire to
the public in the provision of telecommunications services subjects
resellers, as telecommunication carriers under CALEA, to the
obligations of CALEA. For purposes of this Notice of Capacity, law
enforcement believes that a reseller and its host carrier can be
treated collectively, as a single entity, given their common
utilization of network equipment, facilities, and services to which
CALEA addresses itself. This Notice of Capacity does not address
resellers' and host carriers' independent obligations to ensure
compliance with other provisions within CALEA.
    The exclusion from this notice of certain other telecommunications
carriers that have services deployed currently or anticipate deploying
services in the near term does not exempt them from any obligations
under CALEA. Law enforcement will consult with these other
telecommunications carriers before applicable capacity requirements are
established and subsequent notices are issued. Law enforcement looks
forward to consulting with these other telecommunications carriers to
develop a reasonable method for characterizing capacity requirements
for them.

II. Applicable Administrative Procedures and Executive Orders

A. Small Business Regulatory Enforcement Fairness Act of 1996

    The Final Notice of Capacity is not a major rule as defined by the
Small Business Regulatory Enforcement Fairness Act of 1996
(SBREFA),<SUP>1</SUP> based upon an assessment that this Final Notice
of Capacity will not have an annual effect on the economy of
$100,000,000 or more; will not cause a major increase in costs or
prices; and will not result in a significant adverse effect on
competition, employment, investment, productivity, and innovation, or
on the ability of United States-based companies to compete with
foreign-based companies in domestic and export markets.
---------------------------------------------------------------------------

    \1\ See Subtitle II of the Contract with America Advancement Act
of 1996, Pub. L. No. 104-121, 110 Stat. 847 (1996).
---------------------------------------------------------------------------

B. Executive Order 12612

    The Final Notice of Capacity will not have a substantial direct
effect on the States, on the relationship between the Federal
Government and the States, or on the distribution of power and
responsibilities among the various levels of government. Therefore, in
accordance with Executive Order 12612, it has been determined that this
notice does not create sufficient federalism implications to warrant
the preparation of a Federalism Assessment.

C. Information Collection

    The Final Notice of Capacity contains no information collection or
recordkeeping requirements under the Paperwork Reduction Act of 1995
(44 U.S.C. 3501 et seq.). Section V of this notice details the
information collection requirement associated with the Carrier
Statement to be submitted by carriers.

D. Executive Order 12988

    The Final Notice of Capacity meets the applicable standards set
forth in sections 3(a) and 3(b)(2) of Executive Order 12988, Civil
Justice Reform.

E. Executive Order 12866

    This Final Notice of Capacity has been drafted and reviewed in
accordance with Executive Order 12866, Sec. 1(b), Principles of
Regulation. It has been determined that this notice is not a
``significant regulatory action'' under Executive Order 12866,
Sec. 3(f), Regulatory Planning and Review and, in particular, that this
notice will neither have an annual economic impact on the economy in
excess of $100,000,000, nor will it economically impact State and local
governments.<SUP>2</SUP> Although not required by Executive Order
12866, this notice has been informally reviewed by the Office of
Management and Budget (OMB).
---------------------------------------------------------------------------

    \2\ H. Rep. No. 103-827, 103d Cong., 2d Sess., reprinted in 1994
U.S.C.C.A.N. 3489, 3505, Page 34.
---------------------------------------------------------------------------

Economic Assessment
    Using a per intercept cost of $460,<SUP>3</SUP> the only cost
estimate provided by the industry, the FBI estimates that industry
compliance will not exceed $28,926,667 in any one year and will cost a
total of $86,780,000 over a three year period. Law enforcement
estimates that the time frame for capacity to be deployed is three
years. If the time is greater than three years then the annual costs
will decrease. Total estimated costs are apportioned as follows:
$71,300,000 for local exchange carriers and $15,480,000 for commercial
radio, cellular and PCS service providers based on the wireline and
wireless capacity requirements published in the appendixes of this
Final Notice of Capacity. Furthermore, it should be noted that carrier
capacity compliance costs for equipment, facilities or services
identified on a Carrier Statement, to be submitted within 180 days of
the effective date of this Final Notice of Capacity, may be eligible
for Government reimbursement. Until the Attorney General agrees to
reimburse a carrier for such modifications, that carrier's equipment,
facilities or services shall be considered compliant with this Final
Notice of Capacity.<SUP>4</SUP> Capacity costs associated with any
equipment, facilities or

[[Page 12221]]

services deployed after the Carrier Statement period of 180 days
following the effective date of this Final Notice of Capacity will not
be eligible for reimbursement.
---------------------------------------------------------------------------

    \3\ Among all the comments to both the Initial Notice of
Capacity and the Second Notice of Capacity, GTE, in its comments to
the Second Notice of Capacity, was the only respondent to provide
estimated capacity costs. The cost of $460 per intercept is based on
the following criteria: (a) each intercept would require the
necessary hardware to provide law enforcement with two channels, (b)
the equipment used to meet the capacity requirements would be
dedicated solely for law enforcement use, and (c) the $460
represents an average cost of intercept equipment and could vary
between $453 and $470.
    \4\ CALEA, Section 104(e).
---------------------------------------------------------------------------

F. Unfunded Mandates Reform Act of 1995

    A Government analysis of the Unfunded Mandates Reform Act (UMRA)
has determined this Final Notice of Capacity will not result in the
expenditure by State, local or tribal governments, in the aggregate, or
by the private sector, of $100,000,000 or more in any one year, and it
will not significantly or uniquely affect small governments. Therefore,
no actions are necessary under the provisions of the Unfunded Mandates
Reform Act of 1995 (UMRA). Even so, the FBI has voluntarily abided by
the tenets of the UMRA throughout this final notice.

G. Regulatory Flexibility Act--Final Regulatory Flexibility Analysis
(FRFA)

    The Regulatory Flexibility Act (RFA) (5 U.S.C. 601 et seq., as
amended) requires that an Initial Regulatory Flexibility Analysis
(IRFA) be prepared and published with all proposed rules. Earlier
analysis by the Government did not indicate that the Initial Notice of
Capacity satisfied the criteria set forth in Section 603(a) of the RFA,
requiring completion of an IRFA. However, upon review of comments
submitted in response to both the Initial and Second Notices of
Capacity, and upon further consideration by DOJ's Office of Policy
Development, it has been determined that this Final Notice of Capacity
does fall within the scope of the RFA. Therefore, the following Final
Regulatory Flexibility Analysis (FRFA) has been completed in accordance
with the requirements of Section 604 of the RFA.
Need for and Objectives of This Final Notice
    The Final Notice of Capacity implements section 104(a) of the
Communications Assistance for Law Enforcement Act (CALEA) (Public Law
103-414), which requires the Attorney General to publish notice of the
estimated future actual and maximum capacity requirements that
telecommunications carriers may be required to effect in support of
electronic surveillance. The capacity requirements serve as a means to
preserve law enforcement's ability, pursuant to court order or other
lawful authorization, to access call content and call-identifying
information in an ever-changing telecommunications environment.
Description and Estimate of the Number of Small Entities To Which the
Final Notice Will Apply
    The Regulatory Flexibility Act defines small entity as having the
same meaning as the terms small organization, small government
jurisdiction, and small business concern. Of these definitions of small
entity, this Final Notice of Capacity is applicable only to small
business concerns.\5\ The Small Business Act (15 U.S.C. 632) defines a
small business concern as one that (1) is independently owned and
operated; (2) is not dominant in its field of operation; and (3) meets
any additional criteria established by the Small Business
Administration (SBA). More specifically, small business concerns within
Standard Industrial Classification (SIC) categories 4812
(Radiotelephone Communications) and 4813 (Telephone Communications,
Except Radio Telephone) are defined by the SBA as those having 1,500 or
fewer employees. The statutory and SBA definitions of ``small business
concern'' were used for purposes of this FRFA analysis.
---------------------------------------------------------------------------

    \5\ Actual and maximum capacity requirements apply to all
telecommunications carriers as defined in section 102(8) of CALEA.
This Final Notice of Capacity, however, is intended to apply only to
providers of local exchange service, commercial mobile radio
service, cellular service, and personal communications services
(PCS).
---------------------------------------------------------------------------

    Total Number of Telephone Companies Affected. The capacity
requirements presented herein may have a significant effect on a
minimal number of telephone companies defined as small businesses by
the SBA. The U.S. Bureau of the Census (the Census Bureau) reports
that, at the end of 1992, there were 3,497 firms engaged in providing
telephone services for at least 1 year.\6\ This number contains a
variety of different categories of providers, including local exchange
carriers (LEC), interexchange carriers, competitive access providers,
cellular carriers, mobile service carriers, and PCS providers. Some of
those 3,497 telephone service firms may not qualify as small business
concerns or small incumbent LECs because they are not ``independently
owned and operated.'' <SUP>7</SUP> For example, a PCS provider that is
affiliated with an interexchange carrier having more than 1,500
employees would not meet the definition of a small business concern.
Consequently, the FBI estimates that fewer than 3,497 telephone service
firms would qualify as small business concerns and be affected by this
Final Notice of Capacity.
---------------------------------------------------------------------------

    \6\ United States Department of Commerce, Bureau of the Census,
1992 Census of Transportation, Communications, and Utilities:
Establishment and Firm Size, at Firm Size 1-123 (indicating only the
number of such firms engaged in providing telephone service and not
the size of such firms) (1995) (1992 Census).
    \7\  15 U.S.C. Sec. 632(a)(1).
---------------------------------------------------------------------------

    Wireline Carriers and Service Providers. The SBA has developed a
definition of small business concerns that are telecommunications
companies other than radiotelephone (wireless) companies (Telephone
Communications, Except Radiotelephone). The Census Bureau reports that
2,321 such telephone companies were in operation for at least 1 year at
the end of 1992.\8\ Employing the SBA's definition, a small business
telephone company other than a radiotelephone company is one with 1,500
or fewer employees.\9\ Of the 2,321 non-radiotelephone companies listed
by the Census Bureau, 2,295 were reported to have fewer than 1,000
employees. Thus, at least 2,295 non-radiotelephone companies might
qualify as small entities or small incumbent LECs based on employment
statistics. Since it is certain that some of these carriers are not
independently owned and operated, this figure overstates the actual
number of non-radiotelephone companies that would constitute small
business concerns under the SBA's definition. Consequently, the FBI
estimates that there are fewer than 2,295 small entity telephone
communications companies (other than radiotelephone companies) that may
be affected by this Final Notice of Capacity.
---------------------------------------------------------------------------

    \8\ 1992 Census, supra, at Firm Size 1-123.
    \9\ 13 CFR Sec. 121.201, SIC 4812.
---------------------------------------------------------------------------

    Local Exchange Carriers. Neither the FCC nor the SBA has developed
a definition of small providers of local exchange services. The closest
applicable definition under SBA rules is that of telephone
communications companies other than radiotelephone (wireless)
companies.\10\ The most reliable source of information regarding the
number of LECs nationwide, of which the FBI is aware, appears to be the
data that the FCC collects annually in connection with the TRS
Worksheet.\11\ According to most recent data, 1,347 companies reported
that they were engaged in the provision of local exchange services.\12\
As some of these carriers have more than 1,500 employees, the FBI is
unable to estimate with greater precision the number of LECs that would
qualify as small business concerns under the SBA's

[[Page 12222]]

definition. Consequently, the FBI estimates that there are fewer than
1,347 small incumbent LECs that may be affected by this Final Notice of
Capacity.
---------------------------------------------------------------------------

    \10\ 13 CFR Sec. 121.201, SIC 4813.
    \11\Federal Communications Commission, Industry Analysis
Division, Telecommunications Industry Revenue: TRS Fund Worksheet
Data, (Average Total Telecommunications Revenue Reported by Class of
Carrier) (Dec. 1996) (TRS Worksheet).
    \12\ TRS Worksheet at Tbl. 1.
---------------------------------------------------------------------------

    Competitive Access Providers. Neither the FCC nor the SBA has
developed a definition specifically applicable to small entities that
are providers of competitive access services (CAPs). The closest
applicable definition under the SBA rules is that of telephone
communications companies other than radiotelephone (wireless)
companies.\13\ The most reliable source of information regarding the
number of CAPs nationwide, of which the FBI is aware, is the data the
FCC collects annually in connection with the TRS Worksheet. According
to most recent data, 57 companies reported that they were engaged in
the provision of competitive access services.\14\ The FBI has no
information on the number of carriers that are independently owned and
operated, nor on those that have 1,500 or fewer employees and thus is
unable to estimate with greater precision the number of CAPs that would
qualify as small business concerns under the SBA's definition.
Consequently, the FBI estimates that there are fewer than 57 small
entity CAPs that may be affected by this Final Notice of Capacity.
---------------------------------------------------------------------------

    \13\ 13 CFR Sec. 121.201, SIC 4813.
    \14\ TRS Worksheet at Tbl. 1.
---------------------------------------------------------------------------

    Radiotelephone (Wireless) Carriers. The SBA has developed a
definition of small business concerns for radiotelephone (wireless)
companies. The Census Bureau reports that there were 1,176 wireless
companies in operation for at least 1 year at the end of 1992.\15\
According to the SBA's definition, a small business radiotelephone
company is one employing 1,500 or fewer persons.\16\ The Census Bureau
also reported that 1,164 radiotelephone companies had fewer than 1,000
employees. Thus, even if all of the remaining 12 companies had more
than 1,500 employees, there would still be 1,164 radiotelephone
companies that might qualify as small business concerns if
independently owned and operated. Because of the lack of information on
the number of carriers that are independently owned and operated, the
FBI is unable to estimate with greater precision the number of
radiotelephone carriers and service providers that would qualify as
small business concerns under the SBA's definition. Consequently, the
FBI estimates that there are fewer than 1,164 small business concerns
considered radiotelephone companies that may be affected by this Final
Notice of Capacity.
---------------------------------------------------------------------------

    \15\ 1992 Census at Firm Size 1-123.
    \16\ 13 CFR Sec. 121.201, SIC 4812.
---------------------------------------------------------------------------

    Cellular Service Carriers. Neither the FCC nor the SBA has
developed a definition of small entities specifically applicable to
providers of cellular services. The closest applicable definition under
the SBA rules is that of radiotelephone (wireless) companies (SIC
4812). The most reliable source of information regarding the number of
cellular service carriers nationwide, of which the FBI is aware, is the
data the FCC collects annually in connection with the TRS Worksheet.
According to most recent data, 792 companies reported that they were
engaged in the provision of cellular services.\17\ The FBI has no
information on the number of carriers that are independently owned and
operated, nor on those that employ 1,500 or fewer persons, and thus is
unable to estimate with greater precision the number of cellular
service carriers that would qualify as small business concerns under
the SBA's definition. Consequently, the FBI estimates that there are
fewer than 792 small entity cellular carriers that may be affected by
this Final Notice of Capacity.
---------------------------------------------------------------------------

    \17\ TRS Worksheet at Tbl. 1.
---------------------------------------------------------------------------

    Broadband Personal Communications Service (PCS) Licensees. The
broadband PCS spectrum is divided into six frequency blocks designated
A through F and the FCC has held auctions for each block. The FCC has
defined small entity in the auctions for C and F Blocks as an entity
that earned average gross revenues of less than $40 million in the
three previous calendar years.\18\ For F Block, an additional
classification of very small business was added and is defined as an
entity that, together with its affiliates, earned average gross
revenues of not more than $15 million for the preceding three calendar
years.\19\ These regulations, defining small entity in the context of
broadband PCS C Block auctions, have been approved by the SBA. No small
businesses within the SBA-approved definition bid successfully for
licenses in A and B Blocks. There were 90 winning bidders that
qualified as small entities in the C Block auctions. A total of 93
small and very small business bidders won approximately 40 percent of
the 1,479 licenses for D, E, and F Blocks. However, licenses for C, D,
E, and F Blocks have not been awarded fully; therefore few, if any,
small businesses currently provide PCS services. Based on this
information, the FBI concludes that the number of small broadband PCS
licensees will include the 90 winning bidders and the 93 qualifying
bidders in the D, E, and F Blocks, for a total of 183 small PCS
providers as defined by the SBA and the FCC's auction rules.
---------------------------------------------------------------------------

    \18\ See Amendment of Parts 20 and 24 of the FCC's Rules--
Broadband PCS Competitive Bidding and the Commercial Mobile Radio
Service Spectrum Cap, Report and Order, 11 FCC Rcd 7824 (1996).
    \19\ See Amendment of Parts 20 and 24 of the FCC's Rules--
Broadband PCS Competitive Bidding and the Commercial Mobile Radio
Service Spectrum Cap, Report and Order, 11 FCC Rcd 7824 (1996).
---------------------------------------------------------------------------

    Rural Radiotelephone Service. The FCC has not adopted a definition
of small business specific to Rural Radiotelephone Service, which is
defined in Section 22.99 of the FCC's Rules.\20\ A subset of Rural
Radiotelephone Service is basic exchange telephone radio systems
(BETRS).\21\ Accordingly, the FBI will use the SBA's definition
applicable to radiotelephone companies, i.e., an entity employing 1,500
or fewer persons. There are approximately 1,000 Rural Radiotelephone
Service licensees; the FBI estimates that a large majority of them may
qualify as small entities under the SBA's definition.\22\
---------------------------------------------------------------------------

    \20\ 47 CFR Sec. 22.99.
    \21\ See 47 CFR Secs. 22.757--22.759.
    \22\ 13 CFR Sec. 121.201, SIC 4812.
---------------------------------------------------------------------------

Reporting, Recordkeeping, and Other Compliance Requirements
    The Final Notice of Capacity does not impose reporting or record
keeping requirements \23\ on the entities to which it applies. It does,
however, administer compliance requirements, as defined in Appendixes A
through D of this notice.
---------------------------------------------------------------------------

    \23\  To the extent that CALEA compliance may entail reporting
and recordkeeping requirements, those issues are separate from the
capacity requirements covered in this Final Notice of Capacity and
are the subject of a pending proceeding before the FCC.
(Communications Assistance for Law Enforcement Act, CC Docket No.
97-213, released October 10, 1997).
---------------------------------------------------------------------------

Summary and Analysis of Significant Issues Raised by Public Comments
    On October 16, 1995, the FBI published an Initial Notice of
Capacity for comment (60 FR 53643). On November 9, 1995 the industry
comment period was extended until January 16, 1996. After reviewing
comments in response to the Initial Notice of Capacity, the FBI
published a Second Notice of Capacity (62 FR 1902). Comments on the
Second Notice of Capacity were accepted from January 14, 1997, through
March 15, 1997. Upon review of comments submitted in response to both
the Initial and Second Notices of Capacity, it was determined that
issues and sentiments specific to small entities were not only
represented, but also shared by industry as a whole. A detailed summary
of comments is presented in Section VII of

[[Page 12223]]

the notice. Those of particular interest to small entities are reviewed
below.
    Burden on small companies. Small business commenters or
organizations representing small business interests expressed concern
that projected capacity requirements pose a disparate economic burden
on small telecommunications carriers that serve areas in which a single
historical incident involving a large of number of simultaneous
interceptions occurred. Commenters were also concerned that the
methodology used to develop the projected capacity requirements relies
far too heavily on unusually high historical incidents and ignores
routine levels of interception activity over time. One commenter stated
that ``a carrier serving a small town, with 1,000 access lines, could
have a greater capacity burden than NYNEX in New York City if the small
carrier had experienced a single incident of major criminal activity 15
years ago.'' <SUP>24</SUP> As stated in Section III of the Notice
(Methodology for Projecting Capacity Requirements), law enforcement's
capacity requirements were estimated by considering historical
surveillance statistics and industry survey data. Furthermore, as the
notice explains, historical intercept activity was measured for the
period January 1993 through March 1995. Any intercept activity before
that time was not considered and, therefore, is not an influential
factor in estimating current capacity requirements. However, taking
into consideration that intercept activity may have occurred before or
after the data collection period, a historic capacity requirement of
one is used as the basis for estimating actual and maximum capacity
requirements for those geographic areas with no reported interceptions
during the survey period.
---------------------------------------------------------------------------

    \24\ Comments of Cellular Mobile Systems of St. Cloud General
Partnership, LLP, in response to the Second Notice of Capacity
Requirements and Request for Comments; Feb. 13, 1997; Page 2.
---------------------------------------------------------------------------

    Small business commenters or organizations representing small
business interests stated that historical intercept activity should not
be the only factor considered to derive capacity requirements;
carriers' market size and number of subscribers should also be
considered.\25\ As indicated in Section III of the Notice, no
conclusive correlation exists between the variables ``location of
criminal activity'' and ``carrier size.'' Although some large carriers
may serve high crime regions and, likewise, some small carriers low
crime regions, no causal relationship exists. Consequently, law
enforcement's historical analysis of electronic surveillance activity
was based on geographic location and the actual occurrence of
surveillance interceptions. Again, available data does not indicate
that a statistically valid relationship exists between law enforcement
capacity requirements and carrier size, whether size is determined by
subscriber lines, geographic boundaries, or any other measure.
---------------------------------------------------------------------------

    \25\ Cellular Mobile Systems of St. Cloud, Teleport
Communications Group, NTCA, OPASTCO, PCIA, in response to the Second
Notice of Capacity Requirements and Request for Comments; Feb. 13,
1997.
---------------------------------------------------------------------------

Steps Taken To Minimize Burdens on Small Entities
    The FBI's guiding principle in the development of this Final Notice
of Capacity was to allow the maximum range of compliance options to
carriers based on configurations of their respective networks. The rule
was crafted to require a minimal level of estimated capacity that
allows law enforcement to effectively meet public safety needs. CALEA's
mandate, which requires that this Final Notice of Capacity identify
actual and maximum capacity requirements, allows carriers to configure
their systems to accommodate the lower level of capacity (actual),
while only requiring that they be able to expeditiously expand to the
upper limit (maximum) should the need arise.
    Within this framework, the FBI sought and incorporated industry
input at all stages of the rulemaking process. Initially, the FBI met
with telecommunications carriers and associations, including the United
States Telephone Association (USTA), the Electronic Communications
Service Provider (ECSP) Committee, the Organization for the Promotion
and Advancement of Small Telecommunications Companies (OPASTCO), the
Cellular Telephone Industry Association (CTIA), the National Telephone
Cooperative Association (NTCA) and the Personal Communications Industry
Association (PCIA), in order to explain the CALEA capacity requirements
and to solicit questions, comments, and opinions from the industry.
Using industry input from these meetings, the FBI drafted the Initial
Notice of Capacity. While the Initial Notice of Capacity was being
developed, the FBI continued to meet with industry to discuss concepts
and solicit industry consultation. During these stages, the FBI
continued to meet with representatives of both wireline and wireless
carriers. The FBI presented to the ECSP Committee the draft methodology
of the Initial Notice of Capacity and an explanation of such concepts
as the applicability of actual and maximum requirements to individual
switches. In addition to carrier representatives, ECSP Committee
membership included representatives of various associations, including
CTIA, NECA, OPASTCO, PCIA and USTA. Again, the FBI solicited comments
and issued an open invitation to meet with anyone who wished to further
discuss the Initial Notice of Capacity. This same consultative
procedure was followed during the development of the subsequent Second
Notice of Capacity. Once the Second Notice of Capacity was published,
the FBI met again with the ECSP committee, as well as with various
individual carriers and associations both before and after its
publication to provide supplemental explanations of the Second Notice
of Capacity and to solicit comments and extend an invitation to discuss
the notice further. The FBI maintained an ongoing dialogue with the
telecommunications industry with regard to the Initial and Second
Notices of Capacity through meetings and in response to comments.
    In addition to industry input, the FBI solicited advice from a
number of other government entities including the Department of
Justice, the FCC, the OMB, and the SBA, as well as state and local law
enforcement.\26\
---------------------------------------------------------------------------

    \26\ The FBI had a continuous dialogue with members of federal,
state, and local law enforcement between June 1995 and September
1997.
---------------------------------------------------------------------------

    The FBI recognizes that some small telecommunications carriers
(small entities) offering service in certain geographic areas with
significant intercept activity may be obligated to afford significant
interception capacity. At the same time, the FBI also recognizes that
the capacity requirements represent a critical means of safeguarding
the public and, consequently, any exemption or relaxation from
compliance would not be without cost. Therefore, to ensure that small
entities are not unduly burdened, the FBI is developing a process
whereby small entities may petition the Attorney General for
reconsideration of their respective capacity requirements. The petition
evaluation process will include consideration of a carrier's size,
dynamics of the region in which the carrier operates, historical
intercept activity, and law enforcement's electronic surveillance
needs.
    The FBI is also drafting a Small Business Compliance Guide (Guide)
as required by SBREFA (5 U.S.C. Sections 801-808). The Guide will be
provided to the SBA and various industry associations representing the
interests of

[[Page 12224]]

small entities. It will also be available upon request from the FBI.
The Guide will identify an FBI small business liaison to assist small
carriers with rule application.
    In conclusion, the FBI believes this Final Notice of Capacity is
fair and reasonable. The FBI remains committed to assisting small
entities in attaining compliance. The FBI intends not only to maintain
dialogue with industry representatives and the SBA's Office of Advocacy
while developing the Small Business Compliance Guide, but also to
ensure that small entities are provided the necessary information and
assistance to attain compliance in the least burdensome and most cost
effective manner possible.

III. Methodology for Projecting Capacity Requirements

A. Overview

    The CALEA mandate set forth in section 104 obligates the Attorney
General to estimate future interception capacity requirements and marks
the first time that: (a) Information has been required to be provided
to telecommunications carriers in order for them to design future
networks with reference to the amount of potential future interception
activity that may occur, and (b) the entire law enforcement community
has been required to project its collective future potential needs for
interception. This mandate has generated legitimate concern in the law
enforcement community because telephone technology historically placed
no constraints on the number of court-ordered interceptions that could
be effected. If not implemented carefully, an under-scoping of capacity
requirements under CALEA would have the unintended effect of
restricting the technical ability to conduct interceptions authorized
in court orders. If future interception needs are understated, law
enforcement's investigative abilities will be hampered and, more
importantly, public safety will be jeopardized.
    Capacity notice provisions were included in CALEA to ensure that
law enforcement's future interception needs in a geographic area would
be articulated so that telecommunications carriers would be put on
notice as to their obligations, in terms of how many interceptions they
would need to be able to effect. These provisions also present a means
for telecommunications carriers to better understand the nature and
extent of their existing statutory obligations to accommodate law
enforcement's interception needs. (Because law enforcement requirements
for all types of interceptions are a function of authorized
investigations, the estimated number that may be required in the future
cannot be zero because that would imply that there is a county or
market service area where an interception would not be conducted or
would never be required. See Section G ``Establishing Threshold
Capacity Requirements'' for further discussion on how minimum threshold
interception capacities are estimated.) To establish capacity
requirements that would meet law enforcement's future potential
interception needs, law enforcement used a rigorous methodology.
Objectives of the methodology used to establish capacity requirements
are to ensure that future interception capacity requirements would (a)
Be rationally grounded, and based on historical interception activity,
(b) ensure that public safety is not compromised, (c) provide
telecommunications carriers with a degree of certainty regarding law
enforcement's potential interception needs over a reasonable period of
time, (d) be based on well-recognized geographic areas affected, and
(e) not dictate a solution to the industry.
    The methodology consisted of these steps:
    <bullet> Collecting information on historical interception activity
    <bullet> Determining geographic areas for identifying capacity
requirements
    <bullet> Deriving a basis for determining capacity requirements for
wireline carriers
    <bullet> Deriving a basis for determining capacity requirements for
wireless carriers
    <bullet> Deriving growth factors for projecting future capacity
requirements from historical information
    <bullet> Establishing threshold capacity requirements.

B. Collecting Information on Historical Interception Activity

    To comply with CALEA's mandate to project future capacity needs,
law enforcement believed it was essential to first establish a
historical baseline of interception activity from which future
interception needs could be projected. This effort entailed a detailed
review and analysis of the available information on recent federal,
state, and local law enforcement interceptions throughout the United
States. Such information had never before been collected in a single
repository. Amassing this detailed and extremely sensitive information
required an unprecedented and time-consuming effort. It involved
identifying sources from which accurate information could be retrieved
efficiently. The information required included the numbers of all types
of interceptions (communications, pen register, and trap and trace)
performed by federal, state, and local law enforcement agencies, in
terms of the actual number of telephone lines intercepted at each
locality. (For purposes of this notice, the word ``line'' refers to the
transmission path from a subscriber's terminal to the network via a
wireline or wireless medium.)
    The Wiretap Report, published annually by the Administrative Office
of the United States Courts, was a valuable source of historical
information on criminal Title III (call content) court orders; however,
it did not identify the actual number of interception lines associated
with each court order or, more importantly, the vastly greater number
of lines associated with call-identifying information interceptions
(e.g., from pen registers and traps and traces) that have been
performed by all law enforcement agencies. Even though law enforcement
used information on the number of court orders reported in the Wiretap
Report for forecasting purposes as described later in this section, the
report did not contain the necessary line-related information needed to
identify the level of past interceptions for establishing a historical
baseline of activity.
    To obtain line-related information regarding past simultaneous
interceptions, records of interception activity were acquired from
telecommunications carriers as well as law enforcement officials, and
from the federal and state Clerks of Court offices (the official
repositories for all interception court orders) through a survey. The
objective of the survey effort was to determine the numbers of all
types of interceptions (communications, pen register, and trap and
trace) conducted between January 1, 1993, and March 1, 1995, for all
geographic areas. Highly sensitive information pertaining to each
interception was collected, including interception start/end dates and
area code and exchange. The time period of January 1, 1993 to March 1,
1995 was chosen to obtain recent interception information that was
reasonably retrievable given the time constraint imposed by CALEA with
regard to publishing a Notice of Capacity.
    Approximately 1,500 telecommunications carriers, representing
nearly all wireline and cellular telephone companies (as of March
1995), were requested to provide information identifying where and how
many interceptions had occurred within their networks during the survey
period.

[[Page 12225]]

Records were submitted by approximately 66 percent of the
telecommunications carriers surveyed. To ensure receipt of information
from a comprehensive representation of the telecommunications industry,
law enforcement worked closely with telecommunications carriers serving
large markets or unique geographic areas. Such carriers included the
Regional Bell Operating Companies (RBOC), GTE, and the largest
providers of cellular service.
    Sensitive interception records maintained under seal within the
Clerks of Court offices were acquired through two separate efforts.
Federal court order information was collected under special court
orders directing the unsealing of this information for the limited
purpose of issuing capacity notices required under section 104 of
CALEA. State and local law enforcement records were collected with the
assistance of the offices of the State Attorney Generals, District
Attorneys, and state-wide prosecutors. This effort resulted in the
collection of information on all federal law enforcement interception
activity for the period surveyed and information on interceptions by
state and local law enforcement from most states. (Some states' laws do
not authorize the conduct of all types of interceptions, e.g., call
content interceptions, and other states do not maintain retrievable
records of all historical interception activity.)

C. Determining Geographic Areas for Identifying Capacity Requirements

    Section 104(a)(2)(B) of CALEA requires law enforcement to identify,
to the maximum extent practicable, the capacity needed at ``specific
geographic locations.'' In addressing this mandate, law enforcement
decided that using point-specific sites, such as switch locations, city
blocks, or neighborhoods, would not be appropriate because it would not
properly take into account movement in criminal activity and could lead
to the compromise of sensitive investigations. Also, law enforcement
believed that any geographic designation used should not be subject to
frequent change, should relate to discernible and officially recognized
geographic territorial boundaries, and should be commonly understood by
the affected parties.
    It was also considered essential that the geographic designations
be ones that: (a) Historically have not been affected by regulatory
changes in the telecommunications marketplace, (b) would allow
flexibility for telecommunications carriers in developing solutions,
and (c) would not be affected by changes in the configurations of
telecommunications networks.
    Law enforcement concluded that, for wireline carriers, county
boundaries or their equivalent best met the criteria above and should
be used to define the geographic locations for projecting future
capacity requirements. (For purposes of this notice, the term
``county'' includes boroughs and parishes, as well as the District of
Columbia and a few independent cities in Missouri, Maryland, Nevada,
and Virginia that are not part of any county. U.S. territories such as
American Samoa, Guam, the Mariana Islands, Puerto Rico, and the U.S.
Virgin Islands are treated similarly.) Further, using the geographic
designation of a county in this way was deemed appropriate because it
is used by both telecommunications carriers and law enforcement.
Telecommunications carriers pay county taxes and fees and are affected
by county regulations. Likewise, law enforcement's legal territorial
jurisdictions frequently are drawn based on county boundaries, and
resources for law enforcement are often allocated on a county basis.
    For wireless carriers, individual county boundaries were not
considered to be a feasible geographic designation for identifying
capacity requirements. Instead, law enforcement determined that
wireless market service areas--Metropolitan Statistical Areas (MSA),
Rural Statistical Areas (RSA), Major Trading Areas (MTA), and Basic
Trading Areas (BTA)--would be more appropriate geographic designations.
Although wireless market service areas comprise sets of counties,
market service areas best take into account the greater inherent
mobility of wireless subscribers. Furthermore, what is most important
is that historical information on wireless interceptions could only be
associated with market service areas.
    The approach selected--using counties for wireline carriers and
market service areas for wireless carriers--was also responsive to
comments on the Initial Notice of Capacity urging that the two types of
telecommunications carriers be treated separately; thus, different
geographic designations should appropriately apply.

D. Deriving a Basis for Determining Capacity Requirements for Wireline
Carriers

    Having established the county as the appropriate geographic area
for identifying capacity requirements for wireline carriers, law
enforcement had to decide on a basis for determining capacity
requirements for each county. Section 104(a)(2)(A) of CALEA stated that
the capacity requirements could be based on type of equipment, type of
service, number of subscribers, type or size of carrier, or nature of
service area, but allowed the use of ``any other measure.'' Law
enforcement chose to use the historical interception activity
associated with telecommunications equipment located within a county as
the most logical basis for making determinations about projected
capacity requirements in a county.
    Each wireline interception reported during the historical period
surveyed (January 1, 1993, to March 1, 1995) was associated with a
telecommunications switch, based on its area code and exchange
(frequently referred to as its ``NPA/NXX code''), as found in the April
1995 version of the Local Exchange Routing Guide (LERG) published by
Bellcore. The LERG contains information on the switching systems and
exchanges of wireline carriers and is considered to be an authoritative
source by the telecommunications industry. Thereafter,
telecommunications switches were associated to counties by using the
vertical and horizontal coordinates marking the switch's physical
location.
    CALEA also required that capacity requirements be expressed in
terms of ``simultaneous'' interceptions. Law enforcement chose to
consider interceptions occurring on the same day, rather than at
exactly the same moment, as being simultaneous.<SUP>27</SUP> This time
frame was logical from a law enforcement perspective, because
interception court orders are authorized for a certain number of days
as opposed to some other unit of time. Additionally, the time frame of
one day was compatible with the historical data that was recorded only
in days.
---------------------------------------------------------------------------

    \27\  Through the survey, the FBI was able to accurately discern
the number of interceptions that were authorized simultaneously for
any given day. As might well have been expected, it was impossible
for the FBI to discern the number of interceptions that were
effected simultaneously down to the hour, minute, or second.
---------------------------------------------------------------------------

    The daily interception activity of each switch in a county was
examined, and the single day with the most interceptions during the
period surveyed was used to identify the switch's highest number of
simultaneous interceptions. Thereafter, the highest number of
simultaneous interceptions identified for each switch in the county was
totaled to produce a historical baseline for the county. Law
enforcement believed that this approach provided a reasonable
representation of

[[Page 12226]]

past interception needs for the geographic area during the period
surveyed. This approach also avoided the problems that would be
inherent in trying to specify capacity requirements for interceptions
on a site-specific or equipment-specific basis because of the fluid
nature of interceptions conducted over time and because of changes in
equipment and the services that the equipment supports. After
determining the county's historical baseline, law enforcement sought to
establish an appropriate means of utilizing that activity as a basis
for projecting future capacity requirements. In the Initial Notice of
Capacity, requirements were expressed as a percentage of the engineered
capacity of equipment, facilities, and services. It was thought that in
so doing, carriers would have more flexibility in addressing the
capacity requirements. Comments on the Initial Notice of Capacity,
however, questioned the meaning of engineered capacity and recommended
that capacity requirements be expressed as fixed numbers rather than as
percentages. In response, law enforcement re-examined this issue and
found that using fixed numbers for each county would be a clearer way
to express capacity requirements without tying them to constantly-
changing components of telecommunications networks.

E. Deriving a Basis for Determining Capacity Requirements for Wireless
Carriers

    Having established the market service area as the appropriate
geographic area for identifying future capacity requirements for
wireless carriers, law enforcement had to decide on a basis for
determining capacity requirements for each market service area. Each
cellular interception reported during the period surveyed (January 1,
1993, to March 1, 1995) was associated with a cellular market service
area using the August 1995 version of the Cibernet database, which
contains information on roaming and billing arrangements for cellular
networks and is considered to be an authoritative source by the
telecommunications industry. Thereafter, the single day with the most
interceptions during the period surveyed was identified and used as the
historical baseline for each market service area.
    Due to the similarities between cellular and PCS, law enforcement
used the historical interception activity of cellular carriers to
develop projections of future capacity requirements for PCS carriers.
Cellular markets are defined by MSAs and RSAs, and PCS markets are
defined by MTAs and BTAs. Historical cellular interception activity was
mapped to a PCS market service area. Again, the single day with the
most interceptions during the period surveyed was identified and used
as the historical baseline for the market service area.
    To be responsive to comments on the Initial Notice objecting to the
use of percentages of engineered capacity, law enforcement found that
using fixed numbers rather than percentages was also an appropriate
means to express capacity requirements for wireless carriers.

F. Deriving Growth Factors for Projecting Future Capacity Requirements
From Historical Information

    Section 104 of CALEA requires the Attorney General to project
future requirements for actual and maximum capacity. As discussed
previously in this notice, law enforcement derived a baseline for these
estimates from the historical interception activity in geographic areas
defined as counties for wireline carriers and market service areas for
wireless carriers during the period surveyed. To project future
capacity requirements, growth factors were developed and applied to the
historical information.
    As noted, comments on the Initial Notice of Capacity recommended
that capacity requirements be stated separately for wireline and
wireless carriers. In response, law enforcement derived distinct growth
factors for wireline and wireless carriers.
1. Formulas
    As discussed below, four growth factors were used in this Final
Notice of Capacity to project future capacity requirements:
A<INF>wireline</INF>, A<INF>wireless</INF>, M<INF>wireline</INF>, and
M<INF>wireless</INF>. The ``A'' factors were applied to historical
interception activity to estimate future actual capacity requirements
as of October 1998, and the ``M'' factors were used to estimate future
maximum capacity requirements.
    The formulas used for the projections were:

Wireline:
    Future Actual Capacity Requirement in a County Equals The
Historical Interception Activity in the County Multiplied by
A<INF>wireline</INF>
    Future Maximum Capacity Requirement in a County Equals The Future
Actual Capacity Requirement in the County Multiplied by
M<INF>wireline</INF>
Wireless:
    Future Actual Capacity Requirement in a Market Service Area Equals
The Historical Interception Activity in the Market Service Area
Multiplied by A<INF>wireless</INF>
    Future Maximum Capacity Requirement in a Market Service Area Equals
The Future Actual Capacity Requirement in the Market Service Area
Multiplied by M<INF>wireless</INF>

    All of the resulting requirements for future actual and maximum
capacity were rounded up to the next whole number.
2. Growth Factors
    The growth factors used herein were derived solely from analysis
related to the historical interception information. Three sources of
historical information were deemed to provide relevant information to
be considered as growth factors: (a) The number of court orders for
call content interceptions which was obtained from the Wiretap Report
published by the Administrative Office of United States Courts for the
time period 1980 through 1995; (b) the number of court orders for call-
identifying information from pen register and trap and trace
interceptions, which was obtained from reports published by the
Department of Justice (DOJ) documenting pen register and trap and trace
usage by DOJ agencies for the time period 1987 through 1995; and (c)
the historical baseline number of call content interceptions and
interceptions of call-identifying information, which was obtained from
the survey of law enforcement and industry for the time period January
1, 1993, through March 1, 1995.
    To project the future numerical level of court orders, statistical
and analytical methods were applied to the historical interception
information. It should be understood that the projections for the
number of potential future court orders do not mean that they are the
numbers of orders that law enforcement will in fact obtain or intends
to obtain. Rather, they are part of a statistical method used to derive
growth factors that would be useful, ultimately, in calculating future
actual and maximum capacity requirements.
    A commonly-used analytical tool for projections, known as Best-Fit-
Line analysis, was used to track the number of court orders over time
and then to project the number into the future. Projections were made
for call content court orders for wireline and wireless for the year
1998 and the year 2004. Projections were also made for the vastly
greater number of pen register and trap and trace court orders for
wireline and wireless for the year 1998 and the year 2004. Composite
growth

[[Page 12227]]

figures for wireline interceptions and for wireless interceptions were
then calculated by weighting the court order projections by the
relative number of call content interceptions and interceptions of
call-identifying information during the period surveyed. The resulting
A<INF>wireline</INF> and A<INF>wireless</INF> growth factors were based
on the 1998 projections. The M<INF>wireline</INF> and
M<INF>wireless</INF> growth factors were based on the 2004 projections.
The year 1998 was selected to comply with the statutory language of
CALEA requiring law enforcement to estimate actual capacity
requirements by that time. The year 2004 was selected because it
provided a 10-year period after the passage of CALEA, a period that was
considered reasonable for projecting maximum capacity requirements. It
was also considered to be a rational period for constituting a stable
capacity ceiling and a design guide.
    The value derived for A<INF>wireline</INF> is 1.259; the value
derived for A<INF>wireless</INF> is 1.707; the value derived for
M<INF>wireline</INF> is 1.303; and the value derived for
M<INF>wireless</INF> is 1.621. These growth factors can also be
translated into, and understood in terms of, annual growth rates for
capacity requirements. For wireline, if computed annually, growth rates
are 5.92 percent for the period from 1994 through 1998, and 4.55
percent for the period from 1998 through 2004. For wireless, if
computed annually, growth rates are 14.30 percent and 8.38 percent
respectively, for the same time periods. Of relevance in determining
the differences in growth rates are the expectations of overall
business growth for wireline and wireless telephone services. Market
projections for wireline show a steady growth rate of 3.5 percent
annually, and wireless annual growth is projected to be 12.0 percent
during each of the next 10 years.
    For more information on how the growth factors were derived, refer
to Appendix E which is available in the FBI's reading room.

G. Establishing Threshold Capacity Requirements

    In its review of historical interception activity, law enforcement
found that numerous counties and market service areas had no
interception activity during the time period surveyed. Under the
methodology described above, these counties and market service areas
would have future actual and maximum capacity requirements equal to
zero. However, the establishment of future capacity requirements of
zero would not provide even a minimal level of interception capacity,
nor would it address growth flexibility, and it would largely undermine
the intent of CALEA, which is to preserve law enforcement's ability to
conduct some level of interceptions everywhere. Additionally, it is
possible that law enforcement may have conducted interceptions in these
areas before or after the period surveyed, and it may well have to do
so again. Experience has shown that criminal activity can occur
anywhere. Therefore, law enforcement must be capable of conducting a
number of interceptions in all areas. Consequently, minimum threshold
baseline capacities were developed for counties and market service
areas that otherwise would have had a capacity requirement of zero
under the above methodology.
    For wireline telephone service offered in counties, law enforcement
examined the distribution of historical interception activity and found
that many counties had no interceptions, and many others had only one
interception during the time period surveyed. To avoid having counties
with no future capacity requirements, law enforcement decided to treat
counties with zero historical interceptions as if they had one
interception. Hence, when the growth factors for counties were applied,
it produced a future actual capacity requirement of two simultaneous
interceptions and a future maximum capacity requirement of three
simultaneous interceptions.
    For wireless market service areas, law enforcement took a similar
approach. Here, too, it found that many market service areas had no
interceptions during the time period surveyed. Law enforcement chose to
treat these market service areas as if they had one interception.
Hence, when the growth factors for wireless carriers were applied to
these market service areas, the result was a future actual capacity
requirement of two simultaneous interceptions and a future maximum
capacity requirement of four simultaneous interceptions.

IV. Alternative Analysis

    Consideration was given to potentially effective and feasible
alternatives to this rule. However, as discussed in this Alternative
Analysis section, Law enforcement determined that alternatives were not
viable in that they either (1) Would impose undue burdens by not
allowing companies the flexibility to use the efficiencies of their
networks to efficiently meet the requirements; (2) would potentially
impose unfair burdens to companies with specific types of equipment;
(3) would not meet the needs of law enforcement; or, (4) would not take
into consideration the differences between the wireline and wireless
market.

A. Alternative Approaches Considered in Determining Capacity
Requirements

    Law enforcement considered and rejected a number of alternatives
while developing this rule. Initially, law enforcement considered
whether a new regulation was actually necessary. That a notice was
required was obvious from the mandate of CALEA Section 104, which
directs the Attorney General on behalf of all law enforcement entities
to publish notice of the actual and maximum capacity requirements that
telecommunications carriers may be required to effect in support of
lawfully authorized electronic surveillance. Law enforcement could
identify no other existing regulations which might provide viable
alternatives. Ultimately, law enforcement determined that it was
necessary to develop new regulations which were both industry and CALEA
specific. This rule is the result of that development effort.

B. Alternative Promulgated in Initial Notice of Capacity

    In accordance with CALEA 104(a)(2), the Government examined many
different alternatives of expressing the capacity requirements. The
alternatives included basing the requirements upon the type of
equipment, type of service, number of subscribers, type of carrier, and
nature of service area. In fulfilling the mandated role described
above, law enforcement examined a number of alternative approaches in
expressing the capacity required at specific geographic locations. On
October 16, 1995, law enforcement's proposed future actual and maximum
capacity requirements were presented in an Initial Notice of Capacity
published in the Federal Register (60FR53643). Comments on the Initial
Notice were accepted through January 16, 1996.
    In the Initial Notice of Capacity the actual and maximum capacity
requirements were presented as a percentage of the engineered capacity
of the equipment, facilities, and services that provide a customer or
subscriber with the ability to originate, terminate, or direct
communications. Engineered capacity referred to the maximum number of
subscribers that could be served by that equipment, facility, or
service. The percentage were to apply to both the engineered subscriber
capacity of a switch and to non-switch equipment (i.e., network
peripherals) involved in the origination, termination, or direction of
communications. Percentages were used rather than fixed numbers due to
the dynamics and

[[Page 12228]]

diversity of the telecommunications industry. The use of percentages
was expected to allow telecommunications carriers the flexibility to
adjust to changes in marketplace conditions or changes in the number of
subscribers, access lines, equipment, facilities, etc., and still know
the required level of capacity. The percentages were then applied to
three categories, based upon geography and historical intercept
activities.
    As a result of extensive consultation with Federal, State, and
local law enforcement agencies, telecommunications carriers, providers
of telecommunications support services, and manufacturers of
telecommunications equipment, the FBI proposed the following capacity
requirements: each telecommunications carrier would have needed the
ability to meet the capability assistance requirements defined in
section 103 of the CALEA for a number of simultaneous pen register,
trap and trace, and communication interceptions equal to the percentage
of the engineered capacity of the equipment, facilities, or services
that provide a customer or subscriber with the ability to originate,
terminate, or direct communications.
    Each telecommunications carrier would have needed to ensure that it
could expeditiously increase its capacity to meet the assistance
capability requirements defined in section 103 of the CALEA for a
number of simultaneous pen register, trap and trace, and communication
interceptions equal to the percentage of the engineered capacity of the
equipment, facilities, or services that provide a customer or
subscriber with the ability to originate, terminate, or direct
communications. When translated from percentages to numbers, capacity
requirements would have been rounded up to the nearest whole number.
    As noted above, the telecommunications industry generally expressed
the view that this approach was less useful than expressing capacity
requirements with fixed numbers. Consequently, this approach was
abandoned in favor of an approach based upon the use of fixed numbers.

C. Alternative Methods of Expressing Capacity Requirements

    Following the release of the Initial Notice of Capacity, law
enforcement consulted with telecommunications industry representatives,
privacy advocates, and other interested parties to receive feedback on
the method used to express future actual and maximum capacity
requirements. This consultative process assisted law enforcement in
understanding the challenges facing the industry and others in applying
the capacity requirements as expressed in the Initial Notice of
Capacity. Law enforcement refined its approach of defining capacity
requirements and issued a Second Notice of Capacity, published in the
Federal Register on January 14, 1997 (62FR1902) to more fully
articulate estimated actual and maximum capacity requirements. Comments
on the Second Notice of Capacity were accepted through March 15, 1997.
    The objective of both the Initial and Second Notice of Capacity was
to ensure that law enforcement's future capacity requirements would (a)
be rationally grounded, and based on historical interception activity,
(b) ensure that public safety is not compromised, (c) provide both
wireline and wireless telecommunications carriers with a degree of
certainty regarding law enforcement's needs over a reasonable period of
time, (d) be based on the geographic areas affected, and (e) not
dictate a specific solution to the industry.
    Section 104 of CALEA mandates that the Attorney General publish a
Notice of Capacity estimating the capacity requirements that law
enforcement may need to conduct electronic surveillance in the future.
The FBI examined several different methods and formulas to determine
the best way to calculate the requirements to be imposed on the
telecommunications industry. The first method, which was used in the
Initial Notice of Capacity, was to express the actual and maximum
capacity requirements as a percentage of the engineered capacity of the
equipment, facilities, and services that provide a customer or
subscriber with the ability to originate, terminate, or direct
communications. This methodology is described in detail in the Initial
Notice of Capacity.<SUP>28</SUP> The industry considered percentages an
imprecise guideline, the term ``engineered capacity'' confusing, and
that fixed numbers would be a better representation of how capacity
requirements should represented.
---------------------------------------------------------------------------

    \28\ Initial Notice of Capacity, published 10/16/95 60FR53643.
---------------------------------------------------------------------------

Capacity Requirement on a Switch Specific Basis
    Law enforcement assessed the industry comment of expressing future
capacity on a switch or equipment specific basis and determined that
capacity requirements would need to be met regardless of the type,
size, or configuration of switching equipment deployed in any given
geographic area.
    Comments received to the Second Notice of Capacity indicated that
without a more specific delineation of the capacity requirements,
carriers would be placed in the position of applying the capacity
requirements to all the equipment in a geographic area. However, law
enforcement determined that there was no certain correlation between
specific equipment and a geographic location where future interception
capacity may be required.
    One alternative considered was publishing the capacity requirements
on an individual switch basis. With the rapid pace at which the
telecommunications industry network advances and changes,
identification of any specific equipment in the Notice of Capacity
would run the risk of being invalid at the time the Notice of Capacity
is effective. Moreover, any new equipment installed after the
publication date of the Notice of Capacity would not be identified and
present an unnecessary level of ambiguity to all new equipment.
    Equipment supporting the wireline network can be identified within
the Local Exchange Routing Guide (LERG). All local exchange switches
servicing the network are listed with their respective vertical and
horizontal coordinates, and the area codes and exchanges that they
serve. No equivalent source of information exists for the wireless
network. Therefore, expressing wireless capacity requirements could not
be accomplished at a similar geographic level as in the wireline
network.
    A second alternative considered was the assessment of all
simultaneous intercept activity in a given county, regardless of the
amount and location of equipment within the county. This analysis would
result in the determination of the day with the highest number of
interceptions when all interceptions reported within the county were
considered. The application of the requirements would be as though the
electronic surveillance needs of the entire county was served by a
single switch. This value would always be less than or equal to the sum
of all the switch simultaneities within the county and would not allow
for the very real possibility that switch simultaneities could occur
concurrently in the future. For the majority of the counties there was
no significant difference between the sum of switch simultaneities and
county simultaneity (i.e., 2454 of the 3146 would retain the same
county requirement as published in the Second Notice of Capacity).

[[Page 12229]]

However, those counties with significant capacity requirements would be
subject to the largest numeric change in the value of historic
surveillance experience and hence placed under the greatest risk of
underestimating the capacity requirement.
    This alternative results in significant implementation difficulty
for meeting capacity needs because any individual switch activity would
not be taken into account. In fact, this approach dilutes the magnitude
of historic interception activity. This method of consideration would,
over time, understate the needs of law enforcement.
    Furthermore, the promulgation of capacity requirements on a switch
specific basis presupposes a solution and does not allow any
flexibility to carriers as networks evolve. Switch specific capacity
requirements were determined to be an unsatisfactory method of
expressing capacity requirements due to the dynamics and diversity of
the telecommunications industry.
    Further, requirements on a switch specific basis would be untenable
due to the potential for future changes in switch sizes and the areas
they serve. Switch specific capacity requirements would be
fundamentally flawed since they would inappropriately ``freeze'' future
interception capacity based upon past switch activity. Some reasonable
flexibility must be employed. The use of geographic areas is expected
to allow telecommunications carriers the flexibility to adjust to
changes in marketplace conditions or changes in the number of
subscribers, access lines, equipment, facilities, etc.
Single Largest Switch Intercept Value Within a Geographic Area
    A third alternative considered was the application of capacity
based on the single largest switch intercept value in a county to all
switches located in that county. This approach would result in an
excess of capacity required to be deployed in the network and hence
have significant cost implications. Additionally, there would be little
or no law enforcement justification for applying the single largest
switch historical interception value to switches within the county with
minimal electronic surveillance experience.
Average Intercept Activity Value
    A fourth alternative considered was the establishment of capacity
based on an average intercept activity value for all switches in a
county and the application of this value to each switch in that county.
This alternative would result in an understatement of capacity needs
for the county because switches with significant historic electronic
surveillance in some geographic areas would not have an adequate
capacity requirement. The number of switches within a given county can
increase or decrease the average intercept activity for the entire
county, thereby possibly dangerously understating capacity requirements
in a high intercept area.
Total Intercepts Regardless of Simultaneity
    A fifth alternative considered was to express total capacity
requirements of a geographic area based on the total number of
intercepts conducted in that geographic area during the observed time
period, regardless of the simultaneity. A large number of interceptions
does not universally translate into a large simultaneity value for a
given county or switch. The total number of intercepts conducted in a
geographic area is not truly representative of law enforcement
requirements. Furthermore, this could not be considered as a viable
alternative for computing capacity as it does not meet CALEA's
simultaneity requirement as expressed in Section 104(a).
Average Intercept Length
    Another alternative would have been to base, in part, the capacity
requirements on the average intercept length for the county. While this
information may act as an indicator of interception activity in the
county, it would not necessarily be a reflection of a given switch. If
the average length of the interceptions is significant it would be an
indication that the simultaneity is a less peaked or random event.
However, county numbers may still be too nondescript in a small number
of counties to be transcribed to individual switches as requirements in
those instances where the county is very large geographically, or
contains a large number of individual switches.
Size of Carrier
    An analysis of the telecommunications industry reveals that no
association exists between the location of criminal activity and the
size of a carrier that provides service in that geographic area. The
analysis of the historic electronic surveillance activity was based on
the geographic location and the occurrence of each surveillance
reported. No direct relationship can be drawn from the available data
between the capacity requirements and the size of the carrier, whether
that carrier is measured by the number of lines with which it provides
service, the geographic area in which it provides service or any other
measure of size.
Expressing Individual Carrier Capacity Requirements
    Establishment of capacity requirements for individual carriers
cannot be accurately characterized as a geographic method of expressing
capacity requirements as mandated by CALEA. As the existing incumbent
carrier community reacts to increased competition as a result of the
Telecommunications Act of 1996, service territories will undoubtedly
change. Establishing capacity requirements on a carrier-specific basis
also leaves the deployment of capacity up to the interpretation of that
carrier. In the case of a carrier with a very large service area, law
enforcement needs in a particular geographic area may not be satisfied.
The possibility of a carrier not having sufficient capacity of
equipment, facilities and services in a given geographic area would be
a real threat to the public safety. Furthermore, law enforcement was
unable to establish a correlation between where interceptions may be
needed and individual carriers such as to support accurate future
electronic surveillance estimations.
Service or Feature-Specific Capacity Requirements
    Expressing capacity based on services or features would be
unworkable and would fail to provide law enforcement with the coverage
and capability necessary to effect electronic surveillance wherever it
may be needed. Not all services or features are supported in all
geographic areas. With new services and features constantly under
development and deployment, expressing capacity requirements on a
service or feature basis would create an environment that is subject to
frequent change both as to territories and networks. Further, since
criminal activity is mobile in nature, service or feature-specific
capacity requirements would not be conducive to meeting law enforcement
requirements.

V. Statement of Capacity Requirements

    Section 104 of CALEA mandates that law enforcement capacity
requirements be expressed on a geographical basis, to the maximum
extent practicable, and be published in the Federal Register after
government notice and after industry and public comment. In fulfillment
of this mandate, law enforcement, for the first time in history,
conducted an unprecedented survey of historical electronic surveillance
activity including all line related pen register, trap and trace and
communications

[[Page 12230]]

interceptions for the period January 1, 1993 through March 1, 1995. The
analysis of this collected information was used to form a baseline from
which future interception activity was projected using well recognized
statistical tools and methods.
    The issuance of this Notice of Capacity represents fulfillment of
the statutory mandate to provide notice for estimated future actual and
maximum capacity requirements. Taking the unpredictable nature of crime
into account, law enforcement has made every attempt to provide
reasonable and prudent numbers in specific geographic areas, to the
maximum extent practicable, based upon hard historical interception
data.
    The capacity requirements as stated in this Final Notice of
Capacity are requirements of a geographic nature and do not presuppose
a specific technical solution or deployment strategy of the industry or
of an individual carrier. The capacity requirements are expressed as to
specific geographical areas to the maximum extent practicable and hence
satisfy the obligation placed upon law enforcement by CALEA. Law
enforcement, in the fulfillment of its CALEA obligations, has expressed
the capacity requirements after careful consideration of the comments
to the Initial Notice of Capacity and Second Notice of Capacity.
    The methodology used in the formulation of these estimated future
capacity requirements represents interception capacity that may be
required within various geographic areas.
    Both the county and market service area capacity requirements are
based on historic interception activity with future capacity
projections based on growth factor analyses which draw upon past levels
of lawfully authorized interception orders.
    The capacity requirements are being expressed in a solution neutral
manner. Switch specific delineation of capacity requirements would be
contrary to the letter and spirit of CALEA. Furthermore, promulgation
of capacity requirements on a switch-specific basis presupposes a
solution and does not allow any flexibility for the industry and would
be dated to time-specific configurations.
    The dynamic nature of telecommunications technology, and of the
telecommunications industry itself, does not lend itself to the
delineation of capacity requirements of a more granular nature. Law
enforcement, in the publication of estimated future capacity
requirements, projected capacity requirements that would be applicable
regardless of individual carrier network deployment strategies.
    Additionally, law enforcement can not articulate capacity
requirements in any greater detailed fashion without endangering the
public safety and risking exposure of law enforcement sensitive
information. The dynamic nature of criminal activity precludes law
enforcement from publishing capacity requirements at such a detailed
level that would aid the criminal element in determining where law
enforcement is focusing its interception efforts.
    Capacity requirements as published in this Final Notice of Capacity
represent law enforcement's future estimated actual and maximum
interception needs in each geographic area. Carriers are encouraged to
propose solutions that adequately meet law enforcement needs within a
given geographic area. A carrier's specific network configuration may
afford the carrier opportunities to propose unique solutions by which
it can meet law enforcement requirements.
    The obligation to satisfy the capacity requirements in a cost-
effective and reasonable manner is the responsibility of all carriers
that operate within a given geographic area. Although law enforcement
can not dictate how carriers should apply the capacity requirements,
law enforcement is providing guidance to the industry as to the
distribution of capacity requirements within a particular geographic
area.

A. Capacity Requirements for Wireline Carriers

    Law enforcement is providing notice of the estimated number of
future communication interceptions, pen register and trap and trace
device-based interceptions that may be conducted simultaneously in a
given geographic area. Counties have been selected as the appropriate
geographic basis for expressing interception capacity requirements for
telecommunications carriers offering local exchange service (i.e.,
wireline carriers). Appendix A lists all actual and maximum estimates
by county. (Appendix A is available in the FBI's reading room for
review). These numbers represent estimates of potential future
simultaneous call content interceptions and interceptions of call-
identifying information for each county in the United States and its
territories. Wireline carriers may ascertain the actual and maximum
capacity estimates that will affect them by looking up in Appendix A
the county (or counties) for which they offer local exchange service.
These future capacity requirement estimates will remain in effect for
all telecommunications carriers providing wireline service to these
areas until such time, if any, as the Attorney General publishes a
notice of any necessary increase in the maximum capacity pursuant to
section 104(c) of CALEA.
    County capacity requirements represent the estimated future number
of all types of interceptions that may be conducted simultaneously
anywhere within the county. When effective, the county capacity
requirements apply to all existing and any future wireline carriers
offering local exchange service in each county, regardless of the type
of equipment used or the customer base. Individual carriers configure
their networks differently, and as a result, law enforcement recognizes
that carriers may pursue different solutions for meeting the capacity
requirements.

B. Capacity Requirements for Wireless Carriers

    Law enforcement is providing notice of the estimated number of
future communication interceptions, pen register and trap and trace
device-based interceptions that may be conducted simultaneously in a
given geographic area and has selected market service areas--MSAs,
RSAs, MTAs, and BTAs--as the appropriate geographic basis for
expressing actual and maximum interception capacity requirements for
telecommunications carriers offering wireless services, specifically
those providing cellular and PCS services (i.e., wireless carriers).
Appendix B lists all actual and maximum capacity estimates for MSAs and
RSAs; Appendix C lists all actual and maximum capacity estimates for
MTAs; and Appendix D lists all the actual and maximum estimates for
BTAs. (Appendixes B, C, and D are available in the FBI's reading room
for review). These numbers represent estimates of potential future
simultaneous call content interceptions and interceptions of call-
identifying information for each market service area. These future
capacity requirement estimates will remain in effect for all wireless
carriers providing service to these areas until such time, if any, as
the Attorney General publishes a notice of any necessary increases in
maximum capacity pursuant to section 104(c) of CALEA.
    In all cases, the statement of interception capacity for a wireless
market service area reflects law enforcement's estimated future number
of interceptions that may be conducted simultaneously anywhere in the
service area. Law enforcement must be capable of conducting
interceptions at any time, regardless of the location of a subject's

[[Page 12231]]

mobile telephone device within the service area. Once effective, the
market service area capacity requirements apply to all existing and any
future telecommunications carrier offering wireless service in each
market. Individual carriers configure their networks differently, and
as a result, law enforcement recognizes that carriers may pursue
different solutions for meeting the capacity requirements.
    In response to comments submitted to the Second Notice of Capacity
and in order to offer some flexibility for PCS carriers, law
enforcement has chosen to amend the treatment of capacity as to the
geographic areas for PCS carriers serving Major Trading Areas (MTAs)
and Basic Trading Areas (BTAs). Because each PCS market capacity
requirement is based on the historic activity of its respective and
composite cellular markets, every PCS license holder will have the
following options: (1) Provide for the equivalent total capacity of the
composite cellular markets served (MSAs and RSAs, as delineated in
Appendix B), or (2) provide the PCS requirements for MTAs and BTAs as
delineated in Appendix C and D.
    The first option is responsive to the concerns of PCS carriers in
that it allows for PCS capacity requirements to more closely match the
cellular historical activity from which both the cellular and PCS
requirements were derived. This option addresses geographically large
PCS license areas that have capacity requirements driven by a small
number of their composite cellular markets. This option is available to
PCS license holders provided that their systems and services can be
shown to serve only a portion of the MTA or BTA that can be described
with reference to one or more composite cellular markets. As a PCS
service provider expands to offer service throughout a PCS license
area, the PCS carrier would be responsible for the cumulative total of
the capacity requirements of the composite cellular markets.
    The second option allows a PCS carrier, serving an entire license
area (composed of its respective and composite cellular markets), to
meet law enforcement capacity requirements everywhere throughout the
market area. The simultaneity of all historic interceptions occurring
within the geographic area now served by a PCS market is the only way
for law enforcement to represent its estimated actual and maximum
capacity requirements. Therefore, this second option can be used by
those PCS carriers providing telecommunications services throughout the
market area.

C. Capacity Application

    With reference to the matter of applying interception capacity so
as to accommodate the estimated actual and maximum future capacity
numbers specified for the various geographical areas set forth for
wireline and wireless carriers in this Final Notice of Capacity,
distribution of interception capacity will be addressed either pursuant
to CALEA Section 104(d) and (e) or otherwise.
    1. Although law enforcement cannot, under CALEA, dictate solutions,
it is law enforcement's position, consistent with CALEA, that carriers
should consider solutions and approaches for accommodating the
published capacity requirements in a way that maximizes cost-
effectiveness.
    2. Each carrier's deployment strategy must ensure that, if needed,
the estimated actual and maximum capacity requirements set forth for
the applicable geographic areas can be met. Two points require
emphasis: (1) The capacity numbers set forth are for a geographic area
and are not switch-specific requirements, and (2) no carrier will be
expected to provide capacity in excess of the geographically-based
capacity numbers set forth in this Final Notice of Capacity. Until such
time, if any, that law enforcement seeks modification of the maximum
capacity numbers in any geographic area through the publication of a
new capacity notice, no carrier will be expected to provide capacity in
excess of the maximum capacity specified for that area.
    3. Switches serving multiple geographic areas will need to address
the potential cumulative requirement specified for those geographic
areas.
    4. Law enforcement believes that the industry will develop several
solutions for meeting the geographically-based capacity requirements as
stated in this Final Notice of Capacity. In the event that a carrier
elects to deploy a switch-based solution, it should consider the
following information:
Nominal Levels of Capacity
    Under this Final Notice of Capacity, carriers will find that the
overwhelming majority of the geographic areas delineated in the Notice
have estimated capacity requirements that are quite nominal.
    The nominal character of the capacity requirements for the 3,146
counties delineated in Appendix A can be summarized by the following
statistics. Over 66 percent of all counties (2,089) have an actual
capacity requirement of two and a maximum capacity requirement of three
simultaneous interceptions. As described earlier in this Final Notice
of Capacity, these thresholds were based on a county historic
experience of one interception. Approximately 90 percent of all
counties (2,807) have an actual capacity requirement of twelve or less
and a maximum capacity requirement of sixteen simultaneous
interceptions or less.
    The nominal character of the capacity requirements for the 734
cellular market service areas delineated in Appendix B can be
summarized by the following statistics. Approximately 70 percent of all
markets (510) have an actual capacity requirement of two and a maximum
capacity requirement of four simultaneous interceptions. As described
earlier in this Final Notice of Capacity, this threshold was based on a
market service area historic experience of one interception. Over 83
percent of all cellular market service areas (614) have an actual
capacity requirement of twelve or less and a maximum capacity
requirement of twenty simultaneous interceptions or less.
Wireline High-End Switch Capacity
    In order to offer capacity guidance to those carriers that are
offering service in the relatively small number of counties where the
estimated actual and maximum capacity numbers may be somewhat sizeable,
(e.g., 17 out of the 3,146 counties have maximum capacity requirements
of 235 or more) and who choose to pursue a switch-based solution, law
enforcement is providing a high-end capacity ceiling that it would
expect from any one switch. The interception data collected during the
two year survey period indicates that there is a discernable difference
in the interception requirements that law enforcement would need
depending upon the type of surveillance conducted. The data indicates
that the highest level of historic call-identifying information-based
interceptions experienced by any one switch was 235, while the highest
level of historic call content-based interceptions experienced by any
one switch was 45. Applying the previously described wireline growth
factors, the data suggests that a maximum of 386 call-identifying
information-based interceptions and a maximum of 75 call content-based
interceptions may occur on a switch. This information has led law
enforcement to decide that it will not require any wireline carrier to
effect more than 386 simultaneous call-identifying information-based
interceptions or more than 75 call content-based interceptions from any
one switch, regardless of the actual and

[[Page 12232]]

maximum capacity requirements of the counties served by that switch.
Wireless High-End Switch Capacity
    In order to offer capacity guidance to those carriers that are
offering service in the relatively small number of market service areas
where the estimated actual and maximum capacity numbers may be somewhat
sizeable, (e.g., 30 out of the 734 cellular market service areas have
maximum capacity requirements of 58 or more) and who choose to pursue a
switch-based solution, law enforcement is providing a high-end capacity
ceiling that it would expect from any one switch. The interception data
collected during the two year survey period indicates that there is a
discernable difference in the interception requirements that law
enforcement would need depending upon the type of surveillance
conducted. The data indicates that the highest level of historic call-
identifying information-based interceptions experienced by any one
carrier in a given market was 58, while the highest level of historic
call content-based interceptions experienced by any one carrier in a
given market was 41. Applying the previously described wireless growth
factors, the data suggests that a maximum of 163 call-identifying
information-based interceptions and a maximum of 114 call content-based
interceptions may occur in a market for which a carrier would be
responsible. This information has led law enforcement to decide that it
will not require any wireless carrier to effect more than 163
simultaneous call-identifying information-based interceptions or more
than 114 call content-based interceptions from any one switch in a
market, regardless of the actual and maximum capacity requirements of
the market service areas served by that switch. This guidance can be
used by any wireless carrier covered by this Final Notice of Capacity.
    With reference to the matter of applying interception capacity to
accommodate the actual and maximum future capacity numbers specified
for the various geographical areas set forth for wireline and wireless
carriers in this Final Notice of Capacity in those instances that are
not covered by CALEA Section 104(d) and (e), (where carriers are
obligated to meet the interception capacity requirements without
reimbursement) the following information is offered:
    1. The interception capacity requirement within each wireline or
wireless geographic area can be applied and capacity distributed at the
discretion of each carrier.
    Carriers are in the best position to make judgments about how they
will be best able to meet the capacity requirement obligation within
each geographic area based upon the solutions they choose to use in
each area. Solutions that a carrier may choose to deploy could include
centralized, network-based solutions or switch-based solutions,
combinations of these, or other solutions that may be developed within
the telecommunications industry.
    2. From a law enforcement perspective, the fundamental concern is
that interception capacity must be available as needed. Hence, as long
as carriers can accommodate the interception capacity required when
needed, the capacity could be addressed and applied as either reserved
or deployed.

D. Delivery of Capacity Requirements

    Comments from interested parties have requested greater clarity in
law enforcement's definition of an interception for the purpose of
applying law enforcement's capacity requirements to ensure a CALEA-
compliant solution. Interested parties have also commented requesting
clarification as to the matter of ``delivery'' as delivery would relate
to law enforcement's estimated capacity requirement per interception.
In order to provide such additional clarification, the following
illustrative examples are being furnished. They are not intended as an
exhaustive list of options for the industry to pursue. As different
solutions are developed by the industry, the delivery of law
enforcement's estimated capacity requirements may change accordingly.
    For pen register and trap and trace device-based interceptions,
where only call-identifying dialing and signaling information is
collected by the carrier and delivered to law enforcement, it is
anticipated that one delivery channel per interception will suffice for
the delivery of such information to law enforcement. This figure
presupposes, and is based on, a solution where a carrier will
``extract'' any and all dialed digits and related signaling from a
subject's voice channel necessary to fully complete a call and provide
such information on a single delivery channel. Another solution may
require two delivery channels per interception to law enforcement if
such dialed digits and related signaling are not extracted from a
subject's voice channel by a carrier. Furthermore, a carrier may choose
to consolidate the delivery of many pen register and trap and trace
device-based interceptions onto a single delivery channel. The specific
solution chosen by a carrier will therefore dictate the number of
delivery channels necessary to accommodate pen register and trap and
trace device-based interceptions.
    In the case of communications content interceptions, the number of
delivery channels required will be dependent on the specific services
and features made available by a carrier in any given geographic area.
Law enforcement further believes that the industry will develop and
deploy additional services and features in the future which will also
impact the delivery of communications content interceptions to law
enforcement. Any solution developed and deployed by the industry would
need to accommodate those additional services and features.
    The following examples are intended to further clarify the delivery
of law enforcement's estimated capacity requirements, based on the
information currently available to law enforcement, should a carrier
choose to effect a switch-based CALEA-compliant solution. The following
examples do not advocate or discourage the selection and deployment of
any particular solution.
    For the majority of counties, (2,089 of 3,146, or 66.4 percent)
where the estimated wireline actual capacity requirement is two and the
estimated maximum capacity requirement is three, the delivery of
intercepted call-identifying information to law enforcement may take on
any of the following forms. In the event that all of the interceptions
are call-identifying information interceptions, the smallest number of
delivery channels necessary would be one. This would be the case when a
carrier extracts post cut-through dialed digits and related signaling
and consolidates all of this information onto a single delivery channel
and all of the information is intended for a single law enforcement
agency.
    The largest possible number of delivery channels required per
interception for these 2,089 counties occur under circumstances where
every interception was a communications content-based interception and
the subject of the interception employs advanced features and services.
If each such subject subscribes to and simultaneously makes use of
three advanced features, a carrier may need to make available up to
five delivery channels to law enforcement. These advanced features,
being supported by such subjects' service, include but are not limited
to call waiting, an incoming call forwarded to voice-mail, and a
conference call. The delivery of all of the potential intercepted

[[Page 12233]]

communications content and call-identifying information associated with
these features could necessitate up to 15 delivery channels for the
entire county for the simultaneous delivery to law enforcement of all
of the potential communications and related call-identifying
information supported by the subjects' service.
    An additional 820 (26.1 percent) counties have estimated wireline
maximum capacity requirements of 25 or less. In the case where all 25
interceptions are call-identifying information-based interceptions, a
carrier may be required to provide 50 channels for the delivery of
dialed digits and related signaling information. This number would
decrease where the carrier extracts post cut-through dialed digits and
signaling and consolidates the information on a single delivery
channel. The largest possible number of delivery channels a carrier may
be required to provide would be where all 25 interceptions were
communications content-based and the subject of each interception
utilizes a number of advanced features. As in the previous example, if
each subject subscribes to and simultaneously makes use of three
advanced features, a carrier may need to make up to five delivery
channels available to law enforcement. In this example, if every
subject within the county subscribes to and employs these services
simultaneously, there would be a need for up to 125 delivery channels
to be made simultaneously available to law enforcement.
    The above two examples have application to 2,909 of the 3,146 (92.5
percent) counties covered by this Final Notice of Capacity. For those
relatively few counties where the estimated capacity requirements of a
county exceed the maximum levels set forth above for a switch-based
solution, the number of delivery channels required would be contingent
upon the type of interception and the specific solution chosen by a
carrier. The 386 maximum simultaneous interceptions described earlier
can include as many as 75 communications content interceptions. Using
the previous example, this would result in 311 (386 less 75) channels
necessary for the delivery of pen register and trap and trace device
interceptions (this would be the case when a carrier extracts post cut-
through dialed digits and related signaling and consolidates this
information onto a single delivery channel per intercept) and up to
five channels for each of the communications content interceptions. The
total number of channels would therefore be 686 (5  x  75 = 375 + 311 =
686). This number would be greatly reduced if the information for the
311 pen register and trap and trace device interceptions were to be
further consolidated.
    For the majority of wireless markets (510 of 734 cellular markets,
or 69.5 percent), where the estimated wireless actual capacity
requirement is two and the estimated wireless maximum capacity
requirement is four, the delivery of intercepted call-identifying
information to law enforcement may take on any of the following forms.
In the event that all of the interceptions are call-identifying
information interceptions, the smallest number of delivery channels
necessary would be one. This would be the case when a carrier extracts
post cut-through dialed digits and related signaling and consolidates
all of this information onto a single delivery channel and all of the
information is intended for a single law enforcement agency.
    The largest possible number of delivery channels required per
interception for these 510 cellular markets would occur under the
circumstances where every interception was a communications content-
based interception and the subject of the interception employs advanced
features and services. If each such subject subscribes to and
simultaneously makes use of three advances features, a carrier may need
to make available up to five delivery channels to law enforcement. If
every subject within the market subscribes to and employs these
services simultaneously, there would be a need for up to 20 delivery
channels to be made simultaneously available to law enforcement.
    An additional 114 (15.5 percent) cellular markets have estimated
capacity wireless maximum requirements of 25 or less. In the case where
all 25 interceptions are call-identifying information-based
interceptions, a carrier may be required to provide 50 channels for the
delivery of dialed digit and signaling information. This number would
decrease where the carrier extracts post cut-through dialed digits and
signaling and consolidates the information on a single delivery
channel. The largest possible number of delivery channels a carrier may
be required to provide would be in the case where all 25 interceptions
were communications content-based and the subject of each interception
utilizes advanced features. As in the previous example, if each subject
subscribes to and simultaneously makes use of three advanced features,
a carrier may need to make up to five delivery channels available to
law enforcement. In this example, if every subject within the county
subscribes to and employs these services simultaneously, there would be
a need for up to 125 delivery channels to be made simultaneously
available to law enforcement.
    The above two examples have application to 624 of the 734 (85.0
percent) cellular markets covered by this Final Notice of Capacity. For
those relatively few markets where the estimated capacity requirements
of a market exceed the maximum levels set forth above for a switch-
based solution, the number of delivery channels required would be
contingent upon the type of interception and the specific solution
chosen by a carrier. The 163 maximum simultaneous interceptions
described earlier can include as many as 114 communications content
interceptions. Using the previous example, this would result in 49 (163
less 114) channels necessary for the delivery of pen register and trap
and trace device interceptions (this would be the case when a carrier
extracts post cut-through dialed digits and related signaling and
consolidates this information onto a single delivery channel per
intercept) and up to five channels for each of the communications
content interceptions. The total number of channels would therefore be
619 (114  x  5 = 570 + 49 = 619). This number would be reduced if the
information for the 49 pen register and trap and trace device
interceptions were to be further consolidated.

VI. Related Issues

A. Carrier Statement

    Section 104(d) of CALEA requires that within 180 days of this Final
Notice of Capacity, a telecommunications carrier shall submit a
statement identifying any of its systems or services that do not have
the capacity to accommodate simultaneously the number of call content
interceptions and interceptions of call-identifying information set
forth in this Final Notice of Capacity. Resellers of telecommunication
service need not report on systems or services subject to the reporting
requirements of another carrier. The information in the Carrier
Statement will be used, in conjunction with law enforcement priorities
and other factors, to determine the telecommunications carriers that
may be reimbursed in accordance with CALEA section 104(e).
    A Telecommunications Carrier Statement Template has been developed
with the assistance of the telecommunications industry to facilitate
submission of the Carrier Statement. Use of the template is not
mandatory, but law enforcement

[[Page 12234]]

encourages industry to use the template when identifying any of its
systems or services that do not have the capacity to accommodate
simultaneously the number of call content interceptions, pen registers,
and trap and trace interceptions set forth in this Final Notice of
Capacity.
    The information to be solicited will include the following: Common
Language Location Identifier (CLLI) code or equivalent identifier,
switch model or other system or service type, and the city and state
where the system or service is located. Unique information required for
wireline systems and services will include the host CLLI code if the
system or service is a remote, and the county or counties served by the
system or service. Unique information required for wireless systems and
services will include the MSA or RSA market service area number(s), or
the MTA or BTA market trading area number(s) served by the system or
service.
    The confidentiality of the data received from the
telecommunications carriers will be protected by the appropriate
statute, regulation, or non-disclosure agreements.
    After reviewing the Carrier Statements, the Attorney General may,
subject to the availability of appropriations, agree to reimburse a
carrier for costs directly associated with modifications to attain
capacity requirements in accordance with the final rules on cost
recovery. Decisions to enter into cost reimbursement agreements will be
based on law enforcement prioritization factors.
    On April 10, 1996, the Carrier Statement Notice was published in
the Federal Register for comment under the Paperwork Reduction Act of
1995 (PRA) (61 FR 15974). A sixty-day comment period ensued ending on
June 10, 1996. After reviewing the comments received, the Second
Carrier Statement Notice was published in the Federal Register on April
24, 1997 (62 FR 20032). It was published a second time on May 6, 1997
(62 FR 24662) to correct the issuing agency. Comments were accepted on
the Second Carrier Statement Notice through June 6, 1997. In accordance
with the PRA of 1995, public comment has twice been solicited on the
reporting and record keeping requirements of the Telecommunications
Carrier Statement. These reporting and record keeping requirements have
been assigned an Office of Management and Budget (OMB) Control Number
1110-0024, which expires on November 30, 2000.

B. Cost Recovery Rules

    CALEA authorizes the appropriation of $500 million for reimbursing
telecommunications carriers for certain reasonable costs directly
associated with achieving CALEA compliance. Section 109(e) directs the
Attorney General to establish regulations, after notice and comment,
for determining such reasonable costs and establishing the procedures
whereby telecommunications carriers may seek reimbursement. In
accordance with the section 109 (e) mandate, the final rule was
published in the Federal Register, 62 FR 13307, on March 20, 1997.
    As authorized by section 109, and upon execution of a cooperative
agreement, a telecommunications carrier may be reimbursed for the
following: (1) All reasonable plant costs directly associated with the
modifications performed by the carrier in connection with equipment,
facilities, and services installed or deployed on or before January 1,
1995, in order to comply with section 103; (2) additional reasonable
plant costs directly associated with making the requirements in section
103 reasonably achievable with respect to equipment, facilities, or
services installed or deployed after January 1, 1995; and (3)
reasonable plant costs directly associated with modifications of any
telecommunications carrier's systems or services, as identified in the
Carrier Statement, that do not have the capacity to accommodate
simultaneously the number of call content interceptions and
interceptions of call-identifying information set forth in this Final
Notice of Capacity.

VII. The Second Notice of Capacity

A. Statement of Capacity Requirements in the Second Notice

    The Second Notice of Capacity identified the number of simultaneous
interceptions that telecommunications carriers should be able to
accommodate in a given geographical area as of the date that is 3 years
after the date of this Final Notice of Capacity and thereafter.
    The Initial Notice of Capacity, being law enforcement's first
expression of estimated future interception capacity on a national
scale and for all agencies, was viewed by the industry as too ambiguous
to adequately convey capacity requirements. The comments to the Initial
Notice of Capacity led to a significant change in the methodology used
in developing the capacity requirements, as well as to the expression
of those requirements on a geographically specific basis. Each of those
comments was reviewed and analyzed, and ultimately resulted in the new
approach reflected in the Second Notice of Capacity. As discussed
later, some comments to the Second Notice of Capacity suggested changes
that, if adopted, would have produced a Final Notice of Capacity
similar to the Initial Notice of Capacity.

B. Discussion of Comments on the Second Notice of Capacity

    On January 14, 1997, law enforcement's estimates for future actual
and maximum capacity were presented in the Second Notice of Capacity.
The Second Notice of Capacity was published in the Federal Register as
mandated by section 104 of CALEA. Comments on the Second Notice of
Capacity were accepted through March 17, 1997. Twenty-nine parties
consisting of individuals, privacy advocates, telecommunications
companies and industry associations submitted comments. The substantive
comments are set forth in the following fourteen points.
1. The Capacity Requirements Are Not Representative of the Historical
Electronic Surveillance Information Supplied by the Industry
    Seventeen comments (AirTouch Communications, Ameritech, AT&T
Wireless, Bell Atlantic NYNEX Mobile, Bell Atlantic, BellSouth,
Cellular Mobile Systems of St. Cloud, Cellular Telecommunications
Industry Association, Center for Democracy and Technology and the
Center for National Security Studies, GTE, Harrisonville Telephone Co.,
MCI, Pacific Telesis Group, Personal Communications Industry
Association, SBC Communications, United States Telephone Association,
US West) were received on the Second Notice of Capacity stating that
the capacity requirements were too high. Twelve of these comments
indicated that the numbers were too high and should not be applied to
every carrier, nor should the numbers be applied to every switch within
a geographic area. Two of these comments stated that the Government
failed to estimate its capacity needs in a ``cost-conscious manner''.
Two of the comments specifically indicated that the wireless numbers
were too high. One comment suggested that the information used in
calculating the capacity requirements be audited by the industry in an
effort to validate the requirements.
    In response to the foregoing comments, law enforcement responds by
stating that the future estimated capacity requirements were projected
by applying statistical and analytical methods to the historical
interception information collected during the survey

[[Page 12235]]

of law enforcement and the telecommunications industry. It should be
understood that the projections for the number of potential future
interceptions do not mean that they are the numbers of interceptions
that law enforcement will in fact effect or intends to effect.
    An option considered by law enforcement was to use only industry-
provided numbers in calculating capacity requirements. However, there
exist areas within the country for which neither industry nor law
enforcement data was available. Therefore, the inconsistency in
reporting between the industry and law enforcement did not allow for
the sole reliance on or use of either set of data. Law enforcement
believes, based upon a review of the industry's reporting, that using
only information from the industry would have resulted in an
underestimation of law enforcement interception capacity requirements
in certain areas of the country.
2. The Definition of Expeditious Is Not Realistic for the Expansion
From Actual Capacity to Maximum Capacity
    Seven comments (AirTouch Communications, Bell Atlantic,
Organization for the Promotion and Advancement of Small
Telecommunications Companies, Pacific Telesis Group, Personal
Communications Industry Association, SBC Communications,
Telecommunications Industry Association) were received from the
telecommunications industry stating that five business days would not
be sufficient to allow a carrier to make the necessary equipment