In a number of engineering applications (e.g. in navigation systems, distributed sensor networks, or remote surveillance systems), it is necessary to transmit object position estimates using band limited communication channels. Due to advances in technology, it is feasible to have a tracking filter attached to the sensor, and transmit only the condensed information. This can be considered as a tradeoff between computation and communication requirements. This paper proposes a scheme, which minimizes transmission data rate by sending adaptively encrypted innovations.