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years 1991 through 1998. The amounts receivable
as of September 30, 2003 and 2002 were $367
million and $370 million, respectively.
9 commitments
At September 30, 2003, we estimate our financial
commitment for approved capital projects in progress
to be approximately $2,395 million.
Our total rental expense for the years ended September
30 is summarized as follows (dollars in millions):
| |
2003 |
2002 |
2001 |
|
Non-cancelable real
estate leases including
related taxes |
$923 |
$894 |
$863 |
Facilities leased from
General Services
Administration subject
to 120-day notice
of cancellation |
53 |
45 |
41 |
Equipment and other
short-term rentals |
201 |
214 |
312 |
| Total |
$1,177
 |
$1,153
|
$1,216
|
At September 30, 2003, our future minimum lease
payments for all non-cancelable leases are as follows
(dollars in millions):
| Year |
Operating |
Capital |
|
| 2004 |
$ 718 |
$ 80 |
| 2005 |
679 |
80 |
| 2006 |
631 |
80 |
| 2007 |
580 |
80 |
| 2008 |
560 |
80 |
| After 2008 |
5,500
 |
562
|
$8,668
|
$962
 |
| Less: Interest at 4.5% |
220
|
| Total capital lease obligations |
742 |
Less: Short-term portion
of capital lease obligations |
48
|
Less: Long-term portion
of capital lease obligations |
$649
|
Most of these leases contain renewal options for
periods ranging from 3 to 20 years. Certain non-cancelable
real estate leases give us the option to purchase
the facilities at prices specified in the leases.
Capital leases included in buildings were $963 million
in 2003 and $1,038 million in 2002. Total accumulated
amortization is $259 million in 2003 and $264
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million in 2002. Amortization expense for assets
recorded under capital leases is included in depreciation
expense.
10 contingent liabilities
Each quarter we review litigation pending against us.
As a result of this review, we classify and adjust our
contingencies for claims that we think it probable that
we will pay and for which we can reasonably estimate
the amount of the unfavorable outcome.
These claims cover labor, equal employment opportunity, environmental issues, traffic accidents, injuries on postal properties, personal claims and property damages and suits and claims arising from postal contracts. We also recognize the settlements of claims and lawsuits and revisions of other estimates. Additionally, we evaluate the materiality of cases determined to have a reasonably possible chance of adverse outcome. Such cases are immaterial to our financial statements taken as a whole.
As a part of our continuing evaluation of estimates required in the preparation of management's financial statements, we recorded a $92 million decrease in the contingent liabilities balance in 2003, compared to an increase of $187 million in 2002 and an $88 million increase in 2001. We recognized settlements, payments and changes in estimates of claims and lawsuits in our changes in contingent liabilities. Management and General Counsel believe that we have made adequate provision for the amounts that may become due under the suits, claims and proceedings we have discussed here.
11 emergency preparedness
funding
In October 2001, the United States became the target
of biological terrorism. These activities affected us
because infectious biological agents were sent by mail,
resulting in the death of two employees, the curtailment
of mail services in some areas, long-term closing
of two processing facilities and a decline in mail
volume. Our viability and our value to the American
people are dependent upon an open and accessible
system. It was critical to put in place process changes
and technology applications that can reduce risks for
both employees and customers.
The President authorized an initial funding of $175
million for 2002 to assist in paying for these safety
measures. In November 2001, Congress appropriated
an additional $500 million to "protect postal employees
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