By Matthew Sinclair and Richard Williamson

Nonprofits can expect higher costs, more delays and greater challenges in reaching donors after bio-terrorists infected the nation's postal service with anthrax, industry experts said.

For some organizations, the early consequences of the latest terrorist attacks are already happening.
Letters containing threats and a powdery substance arrived at 90 offices of Planned Parenthood and 80 clinics of the National Abortion Federation in mid-October as suspected anthrax was found in the offices of news media, members of Congress and others.

The letters had pre-printed return addresses from the U.S. Marshals Service or the Secret Service and were mailed from Cleveland and Columbus, Ohio; Atlanta; Knoxville, Ky., and Chattanooga, Tenn.

While one of the envelopes sent to a Planned Parenthood clinic in Florida tested positive for a bacterium of some kind, other tests were still pending confirmation from the Centers for Disease Control in Atlanta.

Some of the letters included messages from the "Army of God," a domestic terrorist group that has claimed responsibility for attacks on abortion and birth control clinics.

"It is perverse that these individuals here at home, who are themselves terrorists by virtue of their actions, would seek to capitalize on the events of the last days and weeks to further their own extremist agenda," said Gloria Feldt, president of Planned Parenthood Federation of America. "But this will not deter us from our mission of providing essential health services to women in this nation."
While the threats created further confusion about who is behind the mailing of anthrax-tainted mail, federal authorities pledged to prosecute hoaxers to the full extent of the law. Between Oct. 1 and Oct. 16, the FBI investigated 2,300 cases of suspected anthrax threats, most hoaxes and pranks.
Nonetheless, "they are taking manpower and time away from individuals who could be ensuring that there are no future terrorist acts," said FBI Director Robert S. Mueller III.

On the economic front, the sabotage threatened to disrupt the postal system and add further costs for many financially strapped charities and nonprofits. To combat the threat, the United States Postal Service (USPS) will face the challenge of ferreting out biological hazards in a system that delivers more than 200 billion pieces of mail each year. The costs could be exorbitant.
"Without a doubt, the postal service is going to be looking at a dramatic increase in security," said Neal Denton, executive director of the Alliance of Nonprofit Mailers (ANM). "We're all going to experience delays. We're in uncharted waters."

To help prevent a third postal rate increase this year -- the approval to move ahead for a postal increase for September, 2002 was announced literally the day terrorists hit -- Denton and others are hoping Congress can be convinced to help defray the costs of the added security. The federal government already owes the USPS $956 million.

Even without a rate increase, the job of reaching donors becomes even more difficult, Denton said. "For those folks who rely on direct mail, this is a double whammy," he said. "It's challenging enough to get a consumer to open an envelope. This just makes it harder."

In mid-October, the large USPS facility on Brentwood Road in Washington, D.C., which handles much of the mail for federal entities, tested positive for anthrax and was closed. The closure meant mail delays for the entire region.

Denton was preparing an email missive to ANM's constituency recommending ways to address the new mailing environment when reached after Brentwood's closing. "These days are about as challenging for those who rely on direct mail as any I've ever known," he said.

He said that a lot of the old standbys wouldn't be as welcome in people's mailboxes anymore. For example, an envelope with no return address on it may have been enticing in the past. "Curiosity won't open it now," Denton said. "Consider using a postcard."

While the old saw of "test, test, test" is still true, Denton said, "Any test you've done in the past, a lot of those results just aren't valid in the environment we're in today."

Jeanne Harris, the associate director of development for Paralyzed Veterans of America in Washington, D.C., said that only about 7 million of the organization's 65 million pieces of fundraising mail it sends annually were affected by the Brentwood closure. Looming larger was the delay of incoming checks. "We're going to experience delays," she said. "We don't know what's there and impounded. … The delay is on the revenue side."

As for what it will do for future mailings, should the facility not be able to be utilized soon, the situation is wait and see before it resorts to setting up a new P.O. Box. "We're trying to hold off. We don't know what to expect," she said. "We have a delay on incoming mail and the revenue and response data. We're getting daily updates from our fulfillment center. They're being tested."

Vicki Moeser, a spokesperson with the Smithsonian Institution, said when interviewed days after the Brentwood facility was closed that it still hadn't received mail nor had it picked up. "We've been informed that (Brentwood) won't be processing incoming or outgoing mail," she said, noting that the institution had been sent emails on the subject.

The Smithsonian has its own ZIP code, and its mail processing center is located on North Capitol Street. That facility was closed after Monday, Oct. 22, and was tested for microbes the following day. "I guess because we get mail from Brentwood," Moeser said.

"We have apparently been in the habit of x-raying our mail," she said. "We continue to use (x-ray machines) and we'll use them even more."

She explained that the employees at the processing center were placed on administrative leave for a week, and assuming the center was clean, they would be back the following Monday. "I guess everybody has mail piling up in their offices," Moeser said. "Everything goes through 1111 North Capitol."

For the Smithsonian's disparate sites, that means even "interoffice" mail is on hold unless people take it directly or drop it in a box outside the building, which would then go to a different processing center. "We can still use our envelopes with our Smithsonian logo," she said. "We've just got to put a 34 cent stamp and send it (from outside)."

And other packages could be more problematic and costly. "We don't have a meter in our office," she added. "Some offices are running around and using their petty cash for booklets of stamps."
That may be fine for the short term, with small pieces of mail. But the magazines and newsletters Smithsonian sends out are not likely to be personally stamped and sent.

Howard White, director of media relations for the Humane Society of the United States (HSUS), said the organization had already been putting into place precautionary procedures for the organization's mail handlers. But he wasn't prepared for calls from the media after a press conference of officials from the postal service, the CDC, and the Washington, D.C., mayor cited HSUS specifically as one that might have had mail affected at the Brentwood facility. "I was quite honestly a little irritated that (they'd) hold a press conference and not bother to contact us," he said, "and let us know we're at risk."

Staff members, particularly those who receive the mail that comes through its mail house, have been tested, though results were not yet available.

"Obviously, we're holding our breath … literally and figuratively," said White, noting that while the staff are trying to keep calm with dark humor, the concerns are quite real. "We're really concerned about the possibility our mailing house contractors are possibly at risk and that some of our mail room office (are possibly also). … Right now we're OK."

As for how the Brentwood closing will hit HSUS's bottom line, the answers are still unknown. "We don't know how this will affect us, how it will affect year-end appeals," White said. "But, of course, we know it will."

Some charities have developed innovative ways of reducing mailing costs while boosting responses. March of Dimes in White Plains, N.Y., for example, contacts potential donors who agree to mail and provide postage for letters to 10 other potential donors. While March of Dimes got a huge boost when President Bush kicked off his relief drive for Afghan children at the organization's Oct. 12 volunteer leadership conference, other charities are suffering a dearth of attention. Some suspended their telemarketing efforts in deference to the September 11th Fund and other efforts, making the fourth quarter a leaner one than anticipated.

Denton, who recently spoke at the National Postal Forum in Denver, said the anthrax scare dominated conversation. "This is not a cheerful group of direct marketers, publishers and mailers," Denton said.

At the forum, Postmaster General John E. Potter announced the creation of a task force to oversee security measures but offered no specifics on what steps might be.

In the nonprofit world, charities involved in controversial causes could have trouble attracting volunteers if they fear being targeted by bio-terrorists. Colleges, universities and think tanks that handle large volumes of mail may need to take the greatest precautions, Denton said.
Even before the anthrax attack, the USPS was facing strains on its budget because of the September 11 attacks. It incurred more than $60 million in costs to replace or repair capital equipment as a result of the attacks. Because the USPS is self-insured, it cannot collect for revenues lost as private sector businesses with private insurance can recover in the aftermath of the catastrophic events, Denton said.

The USPS anticipated new, increased security costs of $150 to $200 million during the next five years, officials said. Training for postal employees may cost upwards of $3 million.
Further pressure will come from the loss of air transport capacity. Commercial aviation, which carries the bulk of the nation's air cargo and mail in the belly of passenger jets, has reduced flying by 20 to 25 percent. Scores of passenger jets are mothballed at an airport in the Mojave Desert, and United Airlines has told employees it could "perish" next year if losses are not reversed.
Before the terrorist attacks, the cost of shipping via the airlines was already increasing. Loss of capacity will logically translate to even higher costs as the airlines struggle to survive a dramatic loss of passenger revenue.

Richard Williamson is a Dallas, Texas-based reporter for the Denver News Bureau.

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