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USPS Asks for Additional $1.27 Billion

The U.S. Postal Service told Congress yesterday it needed $1.27 billion for mail sanitation and security equipment through June as a result of the anthrax and terrorist incidents. Also yesterday, the Direct Marketing Association said that film and photographs can still safely be mailed even with a new sanitizing system.

Postmaster general John E. Potter, in a letter to Sen. Robert C. Byrd, D-WV, chairman of the Senate Committee on Appropriations, said the USPS needed $1.27 billion, minus the $175 million in emergency funding that has already been appropriated, or just under $1.1 billion. He also said the figures do not reflect possible future attacks on the nation's mail system.

A Senate subcommittee last week asked the USPS to specify by yesterday how much funding the agency would need.

In the letter, Potter offered a detailed list of the agency's funding needs, including:

• $9.8 million for direct operational costs incurred in New York City to move and secure employees, mail and equipment from locations with displaced operations.

• $83.9 million for costs incurred throughout the nation to handle mail diverted to surface and rail transportation. This includes costs resulting from the Sept. 11 events, as well as the anthrax attacks.

• $43.1 for additional transportation costs. This includes an increase in surface transportation, chartered flights and dedicated air transportation usage, offset by savings from commercial air transportation contracts.

• $15.6 million costs incurred by the U.S. Postal Inspection Service and the inspector general to secure mail, employees and customers.

In addition, Potter said the agency needs $48.5 million for implementation of new security initiatives such as physical mail screening, including bomb detection and hands-on mail inspection at targeted sites.

Potter told the senators at the hearing last week that the USPS needs financial help in coping with the effects of terrorism and related declines in mail volume and revenue. He put the total cost at $5 billion: $3 billion in direct costs for sanitization equipment and $2 billion for the adverse impact on the postal service's shrinking revenue and decreased volume.

According to insiders, the House Appropriations Committee was meeting privately to decide how much money should be given to the USPS and other agencies. Of the $40 billion President Bush earmarked for terrorist-related funding for government agencies, $20 billion is left.

The mailing community is hoping Congress comes through with the funds for the USPS.

“Congress must appropriate funds to cover these extraordinary costs,” said Robert E. McLean, executive director of the Mailers Council, the nation's largest coalition of mailers and mailing associations. “These funds will ensure the continuing, safe operation of a federal agency that is vital to the nation's communication and commerce networks, and that touches every citizen and business every day. America needs a healthy postal service.”

Last year, more than 4 million Americans used the mail tohave their pictures developed. With that in mind, the postal service is testing new sanitation technology on a wide range of film products, digital and magnetic storage devices, laboratory samples, food and plant products, and “smart” credit card with embedded chips. Postal officials say all of these items can be safely processed through the postal system.

“We are working closely with the Postal Service to ensure that technologies to safeguard the mail will be thoroughly tested to ensure that they will not damage any goods that are being sent through the mailstream,” said H. Robert Wientzen, president & CEO, The DMA. “We have heard concerns from direct marketers and consumers that sensitive items, such as film and photographs, are being damaged in the mail. This is classic overreaction at this point in time.”

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