POST office turns to Congress for financial help because of terror attacks

<br>WASHINGTON (AP) _ The government, not people who buy stamps, should cover $5 billion of the enormous costs of recovering from anthrax attacks and making the mail safe, Postmaster General John Potter

Thursday, November 8th 2001, 12:00 am

By: News On 6

WASHINGTON (AP) _ The government, not people who buy stamps, should cover $5 billion of the enormous costs of recovering from anthrax attacks and making the mail safe, Postmaster General John Potter told Congress.

``They should be considered costs of homeland security,'' Potter told a Senate Appropriations subcommittee on Thursday. ``Users of the mail should not be burdened with these extra costs through the price of postage.''

In addition to damage from the Sept. 11 terrorist attacks, the Postal Service has been battered by anthrax-laced letters that have left two workers dead, others sick and the public nervous about its mail.

With the all-important holiday mail season just beginning, Potter said the service is still unsure how high its losses will mount.

``Let me assure you that they are enormous,'' he said, offering an estimate of as much as $7 billion for damages, safety equipment and decreased mail volume.

``Extraordinary expenditures will be required,'' Robert Rider, chairman of the Postal Service Board of Governors, said this week. ``We strongly believe these costs should not be borne by our customers through increased rates.''

Several lawmakers have said they want to include aid for the Postal Service as part of a new $20 billion package of spending related to terrorism. President Bush said Tuesday, however, he would veto any spending beyond the $40 billion Congress appropriated after the Sept. 11 airliner hijackings but before the outbreak of mailed anthrax.

Nonetheless, Potter looked for a sympathetic audience Thursday before the Senate subcommittee.

Deputy Postmaster General John Nolan said Thursday it will be after Jan. 1 before the post office has a firm handle on how much money it needs.

``We don't know exactly the technology we'll be using (to sanitize mail), although we have begun to purchase some, and we're waiting to see the end of the Christmas holiday season to see whether the volume picks back up again,'' Nolan said on ABC's ``Good Morning America.''

Before the attacks, the post office had expected to finish this fiscal year $1.35 billion in the red and already was seeking a rate increase to take effect next year.

But that did not anticipate costs from the hijacking attacks, including damage to post offices and sharp increases in transportation costs because of limits on what mail commercial planes can now carry.

Then the anthrax attacks occurred.

The agency has leased machinery to sanitize the mail, is purchasing other machines and has spent a large amount on testing post offices, buying masks and gloves for workers and on medical care for its staff.

At the same time mail volume, and thus income, dropped sharply. In the four weeks after Sept. 11 there were 6.6 billion fewer mail items than the corresponding period a year ago.

In Bellmawr, N.J., a federal judge closed a postal distribution facility Wednesday after workers complained that they weren't sure it was free of anthrax. A postal workers union said an outside contractor had cleaned the wrong machine after anthrax spores were found on a barcode-sorting device.

Judge Jerome P. Simandle said the facility should remain closed until an arbitrator considers the union's complaints. A worker at the station is being tested for skin anthrax.

Potter and other postal officials met Wednesday with leaders in the mail industry to discuss the agency's future and how to restore confidence in the mail.

Potter announced that Gary Mulloy, president of the advertising firm Advo, donated $250,000 to increase the reward for information leading to whoever sent anthrax in the mail. That reward now stands at $1.25 million.

Mail-related industries ranging from catalog sales to greeting cards to film developing employ 9 million Americans and contribute $900 billion to the national economy annually, Potter noted.

While more than 30 billion pieces of mail have been delivered since Sept. 11, just three letters are known to have been tainted with anthrax, though others are suspected.

Mail industry leaders said they have not encountered major problems getting mail delivered. Postal officials have said service is normal in most of the country, though there have been delivery problems in areas affected by anthrax, such as Washington.