Ok! Here's some information about the lost package auctions. The one in San Francisco closed in 2002 (this must be why I originally read about it, though I was unable to find the SF Chronicle article) The auctions apparently only still operate in Atlanta.
What Happens to Dead Letters at the Post Office's Mail Recovery Center?
For the United States Postal Service, the handling of dead letters makes for serious yet optimistic business at mail recovery centers.
http://www.associatedcontent.comarticle/25176/what_happens_to_dead_letters_at_the.html
and this, which happily references the REM album:
http://en.wikipedia.org/wiki/Dead_letter_office
and this excellent Jonathan Franzen (pre-Corrections) article about the postal service in Chicago which is not entirely related but is awesome and can be read almost in its entirety here:
blerg, it won't let me insert a link here for some reason but you can find it here if you cut and paste: http://tinyurl.com/ck8f93
P.S. this is a post from Claire
What Happens to Dead Letters at the Post Office's Mail Recovery Center?
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