Waste Management 2009 Annual Report Download

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2009 ANNUAL REPORT
Our customers want waste solutions
that are good for business
and good for the planet.
So do we.

Table of contents

  • Page 1
    Our customers want waste solutions that are good for business and good for the planet. So do we. 2009 ANNUAL REPORT

  • Page 2
    ...waste management and environmental services in North America. As of December 31, 2009, the company served nearly 20 million municipal, commercial, industrial, and residential customers through a network of 390 collection operations, 345 transfer stations, 273 active landfill disposal sites, 16 waste...

  • Page 3
    ... and, at the same time, many opportunities. 2009 was certainly a busy year, as the fast-changing landscape of the economy demanded our intent focus on all fronts. But Waste Management is a company that embraces change. It's the way we work. So we did not hesitate to make the adjustments needed to...

  • Page 4
    ..., maintaining consistency in pricing helps us to maintain strength and position our company for sustainable growth. Recordable Injury Rate (TRIR), the number used by the Occupational Safety and Health Administration (OSHA) to track work-related injuries, to a record 3.1 for the year, a level that is...

  • Page 5
    ... trucks. The facility is currently producing 13,000 gallons per day. At our Oklahoma City landfill, we are working on a similar project to convert landfill gas into diesel fuel. We also invested in a company that is developing the technology to convert organic wastes into high-octane transportation...

  • Page 6
    ... to develop plasma gasification technology that processes wastes from various sources into a range of environmentally beneficial fuels. We are excited about the promise that technology holds for the future of the environment and for the growth of our business. Over the next 10 years, we plan to...

  • Page 7
    Form 10-K and Proxy Statement

  • Page 8

  • Page 9
    ... Conference Center Waste Management, Inc. 1021 Main Street Houston, Texas 77002 Purpose: • To elect eight directors; • To ratify the appointment of Ernst & Young LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2010; • To vote on our proposal to...

  • Page 10

  • Page 11
    ... Participation ...Related Party Transactions ...Board of Directors Governing Documents ...Non-Employee Director Compensation ...Election of Directors (Item 1 on the Proxy Card) ...Director Nominee and Officer Stock Ownership ...Persons Owning More than 5% of Waste Management Common Stock ...Section...

  • Page 12

  • Page 13
    ... the website referred to in the Notice or request that a printed set of the proxy materials be sent to them. Internet distribution of our proxy materials is designed to expedite receipt by stockholders, lower the costs of the annual meeting, and conserve natural resources. Record Date Quorum Shares...

  • Page 14
    ...if you hold shares in street name, bring your bank or broker statement showing your beneficial ownership of Waste Management stock in order to be admitted to the meeting. If you are planning to attend our annual meeting and require directions to the meeting, please contact our Corporate Secretary at...

  • Page 15
    ... to the use of the mail, proxies may be solicited personally, by Internet or telephone, or by Waste Management officers and employees without additional compensation. We pay all costs of solicitation, including certain expenses of brokers and nominees who mail proxy materials to their customers or...

  • Page 16
    ... non-employee directors should address their communications to Mr. John C. Pope, Non-Executive Chairman of the Board, c/o Waste Management, Inc., P.O. Box 53569, Houston, Texas 77052-3569. Leadership Structure We separated the roles of Chairman of the Board and Chief Executive Officer at our Company...

  • Page 17
    ...of the day-to-day risks of the Company. Management is encouraged to communicate with the Board of Directors with respect to extraordinary risk issues or developments that may require more immediate attention between regularly scheduled Board meetings. Mr. Pope, as Non-Executive Chairman, facilitates...

  • Page 18
    ..., providing waste management services in the ordinary course of business and the Company's subsidiaries purchasing goods and services in the ordinary course of business. The categorical standards our Board uses in determining independence are included in our Corporate Governance Guidelines, which...

  • Page 19
    ...complaints by our employees, regarding accounting, internal controls and auditing matters. Financial Statements • Review financial statements and Forms 10-K and 10-Q with management and the independent auditor; • Review all earnings press releases and discuss with management the type of earnings...

  • Page 20
    ...independent registered public accounting firm for fiscal year 2009, those matters required to be discussed by Statement on Auditing Standards No. 61, including information regarding the scope and results of the audit. These communications and discussions are intended to assist the Audit Committee in...

  • Page 21
    ... and benefits of all of our executives; • Approve the compensation of our senior management and set the bonus plan goals for those individuals; • Conduct an annual evaluation of our Chief Executive Officer by all independent directors to set his compensation; • Oversee the administration of...

  • Page 22
    ... who the committee chairs will be; • Review individual director's performance in consultation with the Chairman of the Board; • Recommend retirement policies for the Board, the terms for directors and the proper ratio of employee directors to outside directors; • Perform an annual review of...

  • Page 23
    ... and payments under directors' and officers' indemnification insurance policies; (v) any transaction between the Company and any entity in which a related party has a relationship solely as a director, a less than 5% equity holder, or an employee (other than an executive officer); and (vi) purchases...

  • Page 24
    ... fair value of the awards is equal to the number of shares issued times the market value of our Common Stock on that date; there are no assumptions used in the valuation of shares. Shares granted to the non-employee directors in January 2009 were granted under the Company's 2004 Stock Incentive Plan...

  • Page 25
    ...000 for Compensation Committee service (other than Chair) $10,000 for Special Committee service Other Annual Retainers The table below shows the aggregate cash paid, and stock awards issued, to the non-employee directors in 2009 in accordance with the descriptions set forth above: Name Fees Earned...

  • Page 26
    ... planning, and government and community relations through her 34-year professorship with the University of Chicago. Additionally, she has served as a director on multiple public company boards and brings over 30 years of board experience to the Company. Mr. Clark has served in executive positions...

  • Page 27
    ...Chief Executive Officer of The Interlake Corporation, a public diversified metal products company, from 1991 to 1999. As a result, he has extensive management experience within a wide range of business functions. Mr. Reum also brings over 15 years of experience as a director on public company boards...

  • Page 28
    ... AND OFFICER STOCK OWNERSHIP Our Board of Directors has adopted stock ownership guidelines for our non-employee directors that require each director to hold Common Stock or share-based instruments valued at five times his annual cash retainer, based on a $30.00 stock price. Non-employee directors...

  • Page 29
    ..., 2010, our record date for the Annual Meeting. The table also includes information about restricted stock units, stock options and phantom stock granted under various compensation and benefit plans. We did not include information about performance share units granted to executive officers under our...

  • Page 30
    ... of Directors, and Mr. Weidman, President of Wheelabrator Technologies Inc., was late in filing a Form 4 to report the grant by the Company of his annual equity award. • In early 2009, Mr. O'Donnell, President and Chief Operating Officer, learned that a member of his family had purchased shares of...

  • Page 31
    ... a listing of our current executive officers, other than Mr. Steiner, whose personal information is included in the Director Nominees section of this Proxy Statement on page 16, their ages and business experience for the past five years. Name Age Positions Held and Business Experience for Past Five...

  • Page 32
    ...based on Company-wide performance; • Long-term incentive awards granted to named executives consisted of performance share units with a three-year performance period ending December 31, 2011, which may be earned based on the achievement of a pre-determined return on invested capital, or ROIC, goal...

  • Page 33
    ..., including the base salary, target bonus award opportunities, long-term incentive award opportunities and other benefits, including potential severance payments for each of our named executive officers. At a regularly scheduled meeting each year, the Compensation Committee reviews our named...

  • Page 34
    individual annual incentive targets for the current year as a percent of salary for each of the named executive officers; and makes decisions on granting long-term equity awards. The Compensation Committee uses several resources in its analysis of the appropriate compensation for the named executive...

  • Page 35
    ...In making these determinations, total direct compensation consists of base salary, target annual bonus, and the annualized grant date fair value of long-term equity incentive awards. When the competitive analysis was reviewed in 2008, it showed that none of our named executive officers' total direct...

  • Page 36
    ... - Each of our named executive officers is party to an employment agreement, approved by our Compensation Committee that provides for a base salary that, once increased, may not be reduced. The Compensation Committee's annual decisions regarding base salaries generally relate to merit increases, if...

  • Page 37
    ... average rate per unit increase, based on commercial, residential and industrial collection operations; transfer stations; and municipal solid waste and construction and demolition volumes at our landfills. Named Executive Officer Pricing Improvement Target Required* Corporate: Mr. Steiner ...Mr...

  • Page 38
    ...rates, which are used to calculate the present value of our remediation liabilities at our landfills; (iii) charges related to our withdrawal from union sponsored multiemployer pension plans; and (iv) a non-cash charge to fully impair a landfill in California. The Compensation Committee deemed these...

  • Page 39
    ... 30 trading days preceding the Compensation Committee meeting at which the grants were approved to determine the target number of performance share units granted. The dollar value of the awards and corresponding number of performance share units are shown in the table below: Named Executive Officer...

  • Page 40
    ... - In 2010, the Compensation Committee decided to re-introduce stock options as a component of the equity compensation awarded to our named executive officers in order to direct focus on increasing the market value of our Common Stock. Stock options were granted in the first quarter of 2010 in 28

  • Page 41
    ... Committee's practices related to stock options will be included in next year's CD&A discussing 2010 compensation. Post-Employment Compensation - The compensation our named executives receive post-employment is based on provisions included in individual equity award agreements, retirement plan...

  • Page 42
    ... is based on the SEC requirement to report the incremental cost to us of their use. Other Compensation Policies and Practices Stock Ownership Requirements - All of our named executive officers are subject to stock ownership guidelines. We instituted stock ownership guidelines because we believe that...

  • Page 43
    ... material terms of the awards have been communicated to the named executives. The Compensation Committee determines the dollar value of equity awards at a meeting that precedes the date of grant, and determines a number of performance share units to be granted based on a thirty day trailing average...

  • Page 44
    Summary Compensation Table Salary ($) Stock Awards ($)(1) Non-Equity Incentive Plan Compensation ($) All Other Compensation ($)(2) Total ($) Name and Principal Position Year David P. Steiner ...2009 1,116,346 Chief Executive Officer 2008 1,066,049 2007 998,077 Lawrence O'Donnell, III ...2009 805,...

  • Page 45
    ...-board catering, landing fees, trip related hangar/parking costs and other variable costs. We own or operate our aircraft primarily for business use; therefore, we do not include the fixed costs associated with the ownership or operation such as pilots' salaries, purchase costs and non-trip related...

  • Page 46
    ..., Units or Other Rights That Have Not Vested (#)(4) Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested Name Number of Number of Securities Securities Underlying Underlying Option Unexercised Unexercised Exercise Options Options Price...

  • Page 47
    ...10,142 shares, valued at $288,996 based on the market value of our Common Stock on the date of payment, payable under his 2006 performance share unit award. Mr. Woods elected to defer the receipt of the shares until he leaves the Company. Information about deferrals of performance share units can be...

  • Page 48
    ... an award or payment. The terms "Cause," "Good Reason," and "Change-in-Control" as used in the table below are defined in the executives' employment agreements and have the meanings generally described below. You should refer to the individual agreements for the actual definitions. "Cause" generally...

  • Page 49
    ...-in-Control" generally means that: • at least 25% of the Company's Common Stock has been acquired by one person or persons acting as a group; • the majority of the Board of Directors consists of individuals other than those serving as of the date of the named executive's employment agreement or...

  • Page 50
    ... Two times base salary plus target annual bonus (one-half payable in lump sum; one-half payable in bi-weekly installments over a twoyear period) ...• Continued coverage under health and welfare benefit plans for two years ...• Prorated vesting of restricted stock units ...• Prorated payment of...

  • Page 51
    ...the Company or For Good Reason by the Employee Severance Benefits • Two times base salary plus target annual bonus (one-half payable in lump sum; one-half payable in bi-weekly installments over a two-year period) ...3,101,152 • Continued coverage under benefit plans for two years • Health and...

  • Page 52
    ... Cause by the Company or For Good Reason by the Employee Severance Benefits • Two times base salary plus target annual bonus (one-half payable in lump sum; one-half payable in bi-weekly installments over a two-year period)...• Continued coverage under health and welfare benefit plans for two...

  • Page 53
    ... Continued coverage under benefit plans for two years • Health and Welfare Benefit Plans ...• Deferred Savings Plan ...• 401(k) ...• Prorated vesting of restricted stock units ...• Prorated payment of performance share units...Total ...Severance Benefits • Two times base salary plus...

  • Page 54
    ... share unit award agreements accelerate payments of those awards in most cases upon a change-in-control without a termination event. (1) Although these provisions were included in certain named executives' employment agreements prior to 2004, it is not the Compensation Committee's current practice...

  • Page 55
    ... cause or for good reason six months prior to, or two years following, a change-in-control. Mr. Wood's employment agreement does not provide for extended exercisability of his stock options upon termination. The value, if any, of the benefit of continued exercisability to executives is dependent on...

  • Page 56
    ...or regulation and employee benefit plan audits. Tax fees were for tax audit and compliance assistance in certain foreign jurisdictions. The Audit Committee has adopted procedures for the approval of Ernst & Young's services and related fees. At the beginning of each year, all audit and audit-related...

  • Page 57
    ... Proposal RESOLVED: That the shareholders of Waste Management, Inc., ("Company") hereby request that the Company provide a report, updated semi-annually, disclosing the Company's: 1. Policies and procedures for political contributions and expenditures (both direct and indirect) made with corporate...

  • Page 58
    ... example, Waste Management is trying to establish itself as the industry leader for waste and environmental services in a new green economy. A Waste Management senior executive sits on the Board of Directors of The National Association of Manufacturers (NAM), which has reportedly fought legislation...

  • Page 59
    ... submitted quarterly since April 2008 under the Honest Leadership and Open Government Act of 2007, and semi-annual reports include a list of all federal election candidates to whom the PAC contributed during the previous six months. A senior executive of the Company sits on the Board of Directors of...

  • Page 60
    ...5X base salary. We had no shareholder right to cumulative voting, a lead director to call a special meeting or vote on executive pay. Shareholder proposals to address all or some of these topics have received majority votes at other companies and would be excellent topics for our next annual meeting...

  • Page 61
    ... annual meetings. Stockholders have frequently used our annual meetings to propose business by making proposals through the proxy rules, such as this one, and are able to communicate their concerns during the question and answer session of an annual meeting. Our Board is strongly committed to good...

  • Page 62
    ...Corporation is "Waste Management, Inc." Second: The registered office of the Corporation in the State of Delaware is located at Corporation Trust Center, 1209 Orange Street in the City of Wilmington, County of New Castle. The name and address of its registered agent is The Corporation Trust Company...

  • Page 63
    ...operation of a sinking fund or otherwise), purchased or otherwise acquired by the Corporation, or which, if convertible or exchangeable, have been converted into or exchanged for shares of stock of any other class or classes, shall have the status of authorized and unissued shares of Preferred Stock...

  • Page 64
    ... or series of Preferred Stock, voting separately by class or series, to elect directors under specified circumstances, any director or directors may be removed from office at any time, with or without cause but only by the affirmative vote, at any annual meeting or special meeting (as the case may...

  • Page 65
    ... the holders of any one or more classes or series of Preferred Stock issued by the Corporation shall have the right, voting separately by class or series, to elect directors at an annual or special meeting of stockholders, the election, term of office, filling of vacancies, and other features of...

  • Page 66
    IN WITNESS WHEREOF, WASTE MANAGEMENT, INC. has caused this Third Restated Certificate of Incorporation to be signed by , its , this day of , 2010. WASTE MANAGEMENT, INC. [Name] [Title] A-5

  • Page 67
    ... 4000 Houston, Texas (Address of principal executive offices) Registrant's telephone number, including area code: 77002 (Zip code) (713) 512-6200 Securities registered pursuant to Section 12(b) of the Act: Title of Each Class Name of Exchange on Which Registered Common Stock, $.01 par value New...

  • Page 68

  • Page 69
    .... Controls and Procedures ...Item 9B. Other Information ...Item 5. Item 10. Item 11. Item 12. Item 13. Item 14. Item 15. PART III Directors, Executive Officers and Corporate Governance ...Executive Compensation ...Security Ownership of Certain Beneficial Owners and Management and Related Stockholder...

  • Page 70
    ... to the Consolidated Financial Statements. Our principal executive offices are located at 1001 Fannin Street, Suite 4000, Houston, Texas 77002. Our telephone number at that address is (713) 512-6200. Our website address is http://www.wm.com. Our annual reports on Form 10-K, quarterly reports on Form...

  • Page 71
    ... total revenues (in millions) contributed annually by each of our Groups, or reportable segments, in the three-year period ended December 31, 2009. More information about our results of operations by reportable segment is included in Note 21 to the Consolidated Financial Statements and in Management...

  • Page 72
    ...The fees charged at disposal facilities, which are referred to as tipping fees, are based on several factors, including competition and the type and weight or volume of solid waste deposited. We also operate five secure hazardous waste landfills in the United States. Under federal environmental laws...

  • Page 73
    ... of our transfer stations by our own collection operations improves internalization by allowing us to retain fees that we would otherwise pay to third parties for the disposal of the waste we collect. It enables us to manage costs associated with waste disposal because (i) transfer trucks, railcars...

  • Page 74
    ... third parties and our own operations. The cost per ton of material purchased is based on market prices and the cost to transport the finished goods to our customers to whom we sell the materials. The price we pay for recyclable materials is often referred to as a "rebate." Rebates generally are...

  • Page 75
    ... span the United States. Our National Accounts program provides centralized customer service, billing and management of accounts to streamline the administration of customers' multiple and nationwide locations' waste management needs. We also have begun investing in businesses and technologies that...

  • Page 76
    ... subsidiaries. National Guaranty Insurance Company is authorized to write up to approximately $1.4 billion in surety bonds or insurance policies for our closure and post-closure requirements, waste collection contracts and other business-related obligations. (b) We hold a non-controlling financial...

  • Page 77
    ... insurance liabilities as of December 31, 2009 are summarized in Note 11 to the Consolidated Financial Statements. Regulation Our business is subject to extensive and evolving federal, state or provincial and local environmental, health, safety and transportation laws and regulations. These laws...

  • Page 78
    The primary United States federal statutes affecting our business are summarized below: • The Resource Conservation and Recovery Act of 1976, as amended, regulates handling, transporting and disposing of hazardous and non-hazardous waste and delegates authority to states to develop programs to ...

  • Page 79
    ... waste at the state level could adversely affect our operations. Courts' interpretation of flow control legislation or the Supreme Court decisions also could adversely affect our solid and hazardous waste management services. Many states, provinces and local jurisdictions have enacted "fitness" laws...

  • Page 80
    ... generally. If our customers do not have access to capital, we do not expect that our volumes will improve or that we will increase new business. The waste industry is highly competitive, and if we cannot successfully compete in the marketplace, our business, financial condition and operating...

  • Page 81
    ... in a variety of legal and administrative proceedings relating to land use and environmental laws and regulations. These include proceedings in which: • agencies of federal, state, local or foreign governments seek to impose liability on us under applicable statutes, sometimes involving civil or...

  • Page 82
    ... regulations at the federal, state, provincial, and local level in the United States and Canada have a substantial impact on our business. A large number of complex laws, rules, orders and interpretations govern environmental protection, health, safety, land use, zoning, transportation and related...

  • Page 83
    ... record material charges against our earnings due to any number of events that could cause impairments to our assets. In accordance with generally accepted accounting principles, we capitalize certain expenditures and advances relating to disposal site development, expansion projects, acquisitions...

  • Page 84
    ... gas recovery, waste-to-energy and independent power production plant operations. The marketing and sales of energy related products by our landfill gas and waste-to-energy operations are generally pursuant to long-term sales agreements. Therefore, market volatility does not cause our quarterly...

  • Page 85
    ... projected or expected cost savings. Additionally, any systems failures could impede our ability to timely collect and report financial results in accordance with applicable laws and regulations. We may experience adverse impacts on our reported results of operations as a result of adopting new...

  • Page 86
    ... for the periods noted: 2009 2008 Landfills: Owned ...Operated through lease agreements ...Operated through contractual agreements ...Transfer stations ...Material recovery facilities ...Secondary processing facilities ...Waste-to-energy facilities ...Independent power production plants ... 211 26...

  • Page 87
    ..., the closing sale price as reported on the NYSE was $31.93 per share. The number of holders of record of our common stock at February 11, 2010 was 14,327. The graph below shows the relative investment performance of Waste Management, Inc. common stock, the Dow Jones Waste & Disposal Services Index...

  • Page 88
    ... the fourth quarter of 2009: Issuer Purchases of Equity Securities Total Number of Shares Purchased Average Price Paid per Share(a) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Approximate Maximum Dollar Value of Shares that May Yet be Purchased Under the Plans or...

  • Page 89
    ...to be expected in the future. 2009(a) Years Ended December 31, 2008(a) 2007(a) 2006 (In millions, except per share amounts) 2005 Statement of Operations Data: Operating revenues ...Costs and expenses: Operating ...Selling, general and administrative ...Depreciation and amortization ...Restructuring...

  • Page 90
    ... negative short-term effect on our costs and margins. These include professional fees related to expansion projects, acquisitions and the growth of new business lines. We also have not cut back on spending for information technology, which we believe is imperative to enable our employees to perform...

  • Page 91
    ... the year through the payment of $569 million in cash dividends and the repurchase of $226 million of our common stock. Basis of Presentation of Consolidated and Segment Financial Information Fair Value Measurements - In September 2006, the Financial Accounting Standards Board issued authoritative...

  • Page 92
    ... use in the preparation of our financial statements. Landfills Accounting for landfills requires that significant estimates and assumptions be made regarding (i) the cost to construct and develop each landfill asset; (ii) the estimated fair value of capping, closure and post-closure asset retirement...

  • Page 93
    ... within the normal application and processing time periods for approvals in the jurisdiction in which the landfill is located; • We have a legal right to use or obtain land to be included in the expansion plan; • There are no significant known technical, legal, community, business, or political...

  • Page 94
    ... site-specific factors including current and projected mix of waste type, initial and projected waste density, estimated number of years of life remaining, depth of underlying waste, anticipated access to moisture through precipitation or recirculation of landfill leachate, and operating practices...

  • Page 95
    ...using our internal resources or by third-party environmental engineers or other service providers. Internally developed estimates are based on: • Management's judgment and experience in remediating our own and unrelated parties' sites; • Information available from regulatory agencies as to costs...

  • Page 96
    ... facilities. Fees charged at transfer stations are generally based on the weight or volume of waste deposited, taking into account our cost of loading, transporting and disposing of the solid waste at a disposal site. Recycling revenue generally consists of tipping fees and the sale of recyclable...

  • Page 97
    Intercompany revenues between our operations have been eliminated in the consolidated financial statements. The mix of operating revenues from our different services is reflected in the table below (in millions): Years Ended December 31, 2009 2008 2007 Collection ...Landfill ...Transfer ......

  • Page 98
    ... each year, adjusted to exclude the impacts of divestitures: Denominator 2009 2008 Related business revenues: Collection, landfill and transfer ...Waste-to-energy disposal ...Collection and disposal ...Recycling commodities ...Electricity ...Fuel surcharges and mandated fees ...Total Company ...(ii...

  • Page 99
    ... the coming year. Electricity - The changes in revenue from yield provided by our waste-to-energy business are largely due to fluctuations in rates charged for electricity under our power purchase contracts that generally correlate with natural gas prices in the markets where we operate. In 2009, we...

  • Page 100
    ... more economically sensitive special waste and construction and demolition waste streams, although municipal solid waste streams at our landfills have also decreased. Lower third-party volumes in our transfer station operations also caused revenue declines and can generally be attributed to economic...

  • Page 101
    ...; (ii) pricing and competition; and (iii) divestitures. We continue to manage our fixed costs and reduce our variable costs as we experience volume declines, and have achieved significant cost savings as a result. These cost decreases have benefited each of the operating cost categories identified...

  • Page 102
    ... Change 2007 Labor and related benefits ...$2,260 Transfer and disposal costs ...937 Maintenance and repairs ...1,033 Subcontractor costs ...700 Cost of goods sold ...488 Fuel ...414 Disposal and franchise fees and taxes ...578 Landfill operating costs ...222 Risk management ...211 Other ...398...

  • Page 103
    ... operated through a lease agreement. Selling, General and Administrative Our selling, general and administrative expenses consist of (i) labor costs, which include salaries, bonuses, related insurance and benefits, contract labor, payroll taxes and equity-based compensation; (ii) professional fees...

  • Page 104
    ... with each final capping event; and (iv) amortization of intangible assets with a definite life, either using a 150% declining balance approach or a straight-line basis over the definitive terms of the related agreements, which are generally from two to ten years depending on the type of asset. 36

  • Page 105
    ... to standardize processes and improve productivity. In addition, during the first quarter of 2009, responsibility for the oversight of day-to-day recycling operations at our material recovery facilities and secondary processing facilities was transferred from our Waste Management Recycle America...

  • Page 106
    ..., transfer and recycling operations in our Eastern, Western and Southern Groups. Asset impairments (excluding held-for-sale impairments) - Through December 31, 2008, we had capitalized $70 million of accumulated costs associated with the development of our waste and recycling revenue management...

  • Page 107
    ... with an oil and gas lease at one of our landfills; and (ii) a $9 million charge related to bargaining unit employees in New Jersey agreeing to our proposal to withdraw them from an underfunded, multi-employer pension fund. During 2008, the Group's operating income was negatively affected by a 39

  • Page 108
    ... significant impact on the Group's results in 2009 due to the expiration of several long-term energy contracts and short-term pricing arrangements; (ii) an increase in costs for international and domestic business development activities; and (iii) an increase in "Operating" expenses of $11 million...

  • Page 109
    ... 2009 by our closed sites management group due to increases in U.S. Treasury rates used to estimate the present value of our environmental remediation obligations and environmental remediation recovery assets, while in 2008 and 2007, the same group recognized charges to landfill operating costs...

  • Page 110
    ... first half of 2010, including our anticipated purchase of a 40% equity investment in Shanghai Environment Group, which is discussed in Note 11 of our Consolidated Financial Statements, and additional investments in our waste-to-energy and solid waste businesses. When comparing 2008 with 2007, the...

  • Page 111
    ... and recovery assets as a result of changes in the U.S. Treasury rates used to measure these balances. Landfill and Environmental Remediation Discussion and Analysis We owned or operated 268 solid waste and five hazardous waste landfills at December 31, 2009 and we owned or operated 267 solid waste...

  • Page 112
    ...all future expansions will be permitted or permitted as designed, the weighted average remaining landfill life for all owned or operated landfills is approximately 41 years when considering remaining permitted airspace, expansion airspace and projected annual disposal volume. The number of landfills...

  • Page 113
    ... and site-specific factors such as current and projected mix of waste type; initial and projected waste density; estimated number of years of life remaining; depth of underlying waste; anticipated access to moisture through precipitation or recirculation of landfill leachate; and operating practices...

  • Page 114
    ...landfill. Waste types that are frequently identified for beneficial use include green waste for composting and clean dirt for on-site construction projects. When a landfill we own or operate receives certification of closure from the applicable regulatory agency, we generally transfer the management...

  • Page 115
    ...94 $261 The comparison of these costs for the reported periods has been most significantly affected by accounting for changes in the risk-free discount rate that we use to estimate the present value of our environmental remediation liabilities and environmental remediation recovery assets, which is...

  • Page 116
    ... or new opportunities. In addition to our working capital needs for the general and administrative costs of our ongoing operations, we have cash requirements for: (i) the construction and expansion of our landfills; (ii) additions to and maintenance of our trucking fleet and landfill equipment; (iii...

  • Page 117
    ...2010, including our anticipated purchase of a 40% equity investment in Shanghai Environment Group, which is discussed in Note 11 of our Consolidated Financial Statements, as well as additional investments in our waste-to-energy and solid waste businesses. Pending application of the offering proceeds...

  • Page 118
    ... non-cash charge in the fourth quarter of 2009 as a result of a change in expectations for the future operations of a landfill in California. Further, approximately $55 million of the year-over-year decrease in earnings is related to the impact of divestiture gains and gains on sale of assets for...

  • Page 119
    ... the benefits to our interest costs provided by our active interest rate swap agreements; and (ii) reduced the interest costs associated with our variable-rate tax-exempt debt. • Decreased bonus payments - Employee bonus payments earned in 2008, which were paid in the first quarter of 2009, were...

  • Page 120
    ... million in 2007. • Purchases and sales of short-term investments - Net sales of short-term investments provided $184 million of cash in 2007. We used proceeds from the sale of our short-term investments to provide cash that we used to fund our common stock repurchases, dividend payments and debt...

  • Page 121
    ... for checks written in excess of cash balances are reflected as "Other" financing activities in the Consolidated Statement of Cash Flows. There are significant changes in these accrued liability balances as of each yearend, which is generally attributable to the timing of cash deposits. 53

  • Page 122
    ... that we generally incur in the ordinary course of our business. Certain of our obligations are quantity driven. For these contracts, we have estimated our future obligations based on the current market values of the underlying products or services. Accordingly, the amounts reported in the...

  • Page 123
    ... the slower winter months, when waste flows are generally lower, to perform scheduled maintenance at our waste-to-energy facilities. While inflationary increases in costs, including the cost of fuel, have affected our operating margins in recent years, we believe that inflation generally has not had...

  • Page 124
    ... commodity prices. From time to time, we use derivatives to manage some portion of these risks. Our derivatives are agreements with independent counterparties that provide for payments based on a notional amount. As of December 31, 2009, all of our derivative transactions were related to actual...

  • Page 125
    ...of three months or less. Because of the short terms to maturity of these investments, we believe that our exposure to changes in fair value due to interest rate fluctuations is insignificant. Commodity Price Exposure - In the normal course of our business, we are subject to operating agreements that...

  • Page 126
    .... INDEX TO CONSOLIDATED FINANCIAL STATEMENTS Page Management's Report on Internal Control Over Financial Reporting ...Reports of Independent Registered Public Accounting Firm ...Consolidated Balance Sheets as of December 31, 2009 and 2008 ...Consolidated Statements of Operations for the Years Ended...

  • Page 127
    ...OVER FINANCIAL REPORTING Management of the Company, including the Chief Executive Officer and the Chief Financial Officer, is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Rules 13a-15(f) and 15d-15(f) of the Securities Exchange Act of...

  • Page 128
    ... of ASC Topic 810, "Consolidation" related to noncontrolling interests in consolidated financial statements. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), Waste Management, Inc.'s internal control over financial reporting as...

  • Page 129
    ... internal control over financial reporting as of December 31, 2009, based on the COSO criteria. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheets of Waste Management, Inc. as of December 31, 2009...

  • Page 130
    ... income taxes ...Landfill and environmental remediation liabilities ...Other liabilities...Total liabilities ...Commitments and contingencies Equity: Waste Management, Inc. stockholders' equity: Common stock, $0.01 par value; 1,500,000,000 shares authorized; 630,282,461 shares issued . Additional...

  • Page 131
    WASTE MANAGEMENT, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (In Millions, Except per Share Amounts) Years Ended December 31, 2009 2008 2007 Operating revenues...Costs and expenses: Operating ...Selling, general and administrative ...Depreciation and amortization ...Restructuring ...(Income) ...

  • Page 132
    ... divestitures of businesses (net of cash divested) and other sales of assets ...28 Purchases of short-term investments ...- Proceeds from sales of short-term investments ...- Net receipts from restricted trust and escrow accounts ...196 Other ...(14) Net cash used in investing activities ...(1,250...

  • Page 133
    WASTE MANAGEMENT, INC. CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (In Millions, Except Shares in Thousands) Waste Management, Inc. Stockholders' Equity Accumulated Other Comprehensive Additional Treasury Stock Noncontrolling Comprehensive Common Stock Income Paid-In Retained (Loss) Shares Amounts ...

  • Page 134
    ... MANAGEMENT, INC. CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY - (Continued) (In Millions, Except Shares in Thousands) Waste Management, Inc. Stockholders' Equity Accumulated Other Comprehensive Additional Common Stock Treasury Stock Noncontrolling Comprehensive Income Paid-In Retained (Loss) Shares...

  • Page 135
    ... consolidated subsidiaries and consolidated variable interest entities. When we use the term "WMI," we are referring only to Waste Management, Inc., the parent holding company. We are the leading provider of integrated waste services in North America. Using our vast network of assets and employees...

  • Page 136
    ... principle. Refer to Note 9 for additional information about our unrecognized tax benefits. Employers' Accounting for Defined Benefit Pension and Other Post-retirement Plans - In September 2006, the FASB issued revisions to the authoritative guidance associated with the accounting and reporting of...

  • Page 137
    ...information that consistently reflects our current approach to managing our geographic Group operations. Refer to Note 21 for further discussion about our reportable segments. 3. Summary of Significant Accounting Policies Principles of Consolidation The accompanying Consolidated Financial Statements...

  • Page 138
    ..., environmental monitoring equipment for groundwater and landfill gas, directly related engineering, capitalized interest, on-site road construction and other capital infrastructure costs. The cost basis of our landfill assets also includes asset retirement costs, which represent estimates of future...

  • Page 139
    ... Consolidated Statements of Operations. Amortization of Landfill Assets - The amortizable basis of a landfill includes (i) amounts previously expended and capitalized; (ii) capitalized landfill final capping, closure and post-closure costs; (iii) projections of future purchase and development costs...

  • Page 140
    WASTE MANAGEMENT, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) expansion capacity; and (iv) projected asset retirement costs related to landfill final capping, closure and postclosure activities. Amortization is recorded on a units-of-consumption basis, applying expense as a rate ...

  • Page 141
    ...using our internal resources or by third-party environmental engineers or other service providers. Internally developed estimates are based on: • Management's judgment and experience in remediating our own and unrelated parties' sites; • Information available from regulatory agencies as to costs...

  • Page 142
    ... current dollars (by 2.5% at both December 31, 2009 and 2008) until the expected time of payment and discount the cost to present value using a risk-free discount rate, which is based on the rate for United States Treasury bonds with a term approximating the weighted average period until settlement...

  • Page 143
    ... charge recognized during 2009 as a result of our determination to abandon the SAP waste and recycling revenue management software. Refer to Note 13 for additional information related to the management determination to abandon this software development project. Leases We lease property and equipment...

  • Page 144
    ... is generally two to five years. Licenses, permits and other contracts are amortized over the definitive terms of the related agreements. If the underlying agreement does not contain definitive terms and the useful life is determined to be indefinite, the asset is not amortized. Asset Impairments We...

  • Page 145
    WASTE MANAGEMENT, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) measure any impairment by comparing the fair value of the asset or asset group to its carrying value. Fair value is generally determined by considering (i) internally developed discounted projected cash flow analysis of ...

  • Page 146
    ... from the issuance of industrial revenue bonds for the construction of collection and disposal facilities and for equipment necessary to provide waste management services. Proceeds from these arrangements are directly deposited into trust accounts, and we do not have the ability to use the funds in...

  • Page 147
    ... revenues and recognized as revenue in the period service is provided. Capitalized Interest We capitalize interest on certain projects under development, including internal-use software and landfill expansion projects, and on certain assets under construction, including operating landfills and waste...

  • Page 148
    WASTE MANAGEMENT, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) Income Taxes The Company is subject to income tax in the United States, Canada and Puerto Rico. Current tax obligations associated with our provision for income taxes are reflected in the accompanying Consolidated ...

  • Page 149
    WASTE MANAGEMENT, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) 4. Landfill and Environmental Remediation Liabilities Liabilities for landfill and environmental remediation costs are presented in the table below (in millions): December 31, 2009 Environmental Landfill Remediation ...

  • Page 150
    WASTE MANAGEMENT, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) 5. Property and Equipment Property and equipment at December 31 consisted of the following (in millions): 2009 2008 Land ...Landfills ...Vehicles ...Machinery and equipment ...Containers ...Buildings and improvements ...

  • Page 151
    WASTE MANAGEMENT, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) Our other intangible assets as of December 31, 2009 and 2008 were comprised of the following (in millions): Customer Contracts and Customer Lists Covenants Not-toCompete Licenses, Permits and Other Total December 31, ...

  • Page 152
    ... by letters of credit guaranteeing repayment of the bonds in this event. We classified these borrowings as long-term in our Consolidated Balance Sheet at December 31, 2009 because the borrowings are supported by letters of credit issued under our five-year revolving credit facility, which is...

  • Page 153
    ... may only be used for the specific purpose for which the money was raised, which is generally to finance expenditures for landfill construction and development, equipment, vehicles and facilities in support of our operations. Proceeds from bond issues are held in trust until such time as we incur...

  • Page 154
    ...of the tax-exempt project bonds outstanding at December 31, 2009 that were issued by certain subsidiaries within our Wheelabrator Group. These bonds are secured by the related subsidiaries' assets that have a carrying value of $301 million and the related subsidiaries' future revenue. Debt Covenants...

  • Page 155
    ...exchange contracts ...Foreign exchange contracts ...Total derivative assets Current other assets Long-term other assets Current other assets Long-term other assets $ 3 89 1 27 $120 For information related to the methods used to measure our derivative assets and liabilities at fair value, refer to...

  • Page 156
    ... MANAGEMENT, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) have been classified as a change in other assets within "Net cash provided by operating activities" in the Consolidated Statement of Cash Flows. We have designated our interest rate swaps as fair value hedges of our fixed...

  • Page 157
    ... of changes in semi-annual interest payments that are expected for senior notes that the Company plans to issue late in the second quarter of 2010. We have designated our Treasury rate lock derivatives as cash flow hedges. As of December 31, 2009, the fair value of these interest rate derivatives...

  • Page 158
    ... during each of the reported periods. 9. Income Taxes Provision for Income Taxes Our "Provision for income taxes" consisted of the following (in millions): Years Ended December 31, 2009 2008 2007 Current: Federal ...State ...Foreign ...Deferred: Federal ...State ...Foreign ...Provision for income...

  • Page 159
    ... Puerto Rico, as well as various state and local jurisdictions and Canada. We are currently under audit by the IRS and from time to time we are audited by other taxing authorities. Our audits are in various stages of completion. During 2009, we effectively settled an IRS audit for the 2008 tax year...

  • Page 160
    ...-energy projects qualified for tax credits through 2007 under Section 45K of the Internal Revenue Code. Our noncontrolling interests in the coal-based synthetic fuel production facilities resulted in the recognition of our pro-rata share of the facilities' losses, the amortization of our investments...

  • Page 161
    WASTE MANAGEMENT, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) Deferred Tax Assets (Liabilities) The components of the net deferred tax assets (liabilities) at December 31 are as follows (in millions): December 31, 2009 2008 Deferred tax assets: Net operating loss, capital loss and...

  • Page 162
    ... period. 10. Employee Benefit Plans Defined Contribution Plans - Our Waste Management retirement savings plans are 401(k) plans that cover employees, except those working subject to collective bargaining agreements that do not allow for coverage under such plans. Employees are generally eligible to...

  • Page 163
    ... and personal property, workers' compensation, directors' and officers' liability, pollution legal liability and other coverages we believe are customary to the industry. Our exposure to loss for insurance claims is generally limited to the per incident deductible under the related insurance policy...

  • Page 164
    ... We continue to focus on the expansion of our waste-to-energy business and are actively pursuing various projects in the United States and internationally. In August 2009, we entered into an agreement to purchase a 40% equity investment in Shanghai Environment Group ("SEG"), a subsidiary of Shanghai...

  • Page 165
    ...on per ton rates for waste actually received at our transfer stations, landfills or waste-to-energy facilities. • Property - From time to time, we make commitments to purchase assets that we expect to use in our operations. We are currently party to an agreement to purchase a corporate aircraft to...

  • Page 166
    ... - A significant portion of our operating costs and capital expenditures could be characterized as costs of environmental protection, as we are subject to an array of laws and regulations relating to the protection of the environment. Under current laws and regulations, we may have liabilities for...

  • Page 167
    ...WMI's retirement savings plan; the investment committees of WMI's plan and its individual members; and State Street Bank & Trust, the trustee and investment manager of the ERISA plans. The lawsuit attempts to increase the recovery of a class of ERISA plan participants based on allegations related to...

  • Page 168
    ... issues and are subject to uncertainties. Actions filed against us include commercial, customer, and employment-related claims, including purported class action lawsuits related to our customer service agreements and purported class actions involving federal and state wage and hour and other laws...

  • Page 169
    ...locals across the United States. As a result of some of these agreements, certain of our subsidiaries are participating employers in a number of trustee-managed multi-employer, defined benefit pension plans for the affected employees. One of the most significant multi-employer pension plans in which...

  • Page 170
    ... to standardize processes and improve productivity. In addition, during the first quarter of 2009, responsibility for the oversight of day-to-day recycling operations at our material recovery facilities and secondary processing facilities was transferred from our Waste Management Recycle America...

  • Page 171
    ..., transfer and recycling operations in our Eastern, Western and Southern Groups. Asset Impairments (excluding held-for-sale impairments) - Through December 31, 2008, we had capitalized $70 million of accumulated costs associated with the development of our waste and recycling revenue management...

  • Page 172
    ... future business plans and other factors the Board may deem relevant. 16. Stock-Based Compensation Employee Stock Purchase Plan We have an Employee Stock Purchase Plan under which employees that have been employed for at least 30 days may purchase shares of our common stock at a discount. The plan...

  • Page 173
    .... Employee Stock Incentive Plans Pursuant to our stock incentive plan, we have the ability to issue stock options, stock awards and stock appreciation rights, all on terms and conditions determined by the Management Development and Compensation Committee of our Board of Directors. The Company's 2004...

  • Page 174
    ...MANAGEMENT, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) Restricted stock units are subject to pro-rata vesting upon an employee's retirement or involuntary termination other than for cause and become immediately vested in the event of an employee's death or disability. Compensation...

  • Page 175
    WASTE MANAGEMENT, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) related deferred income tax benefits of $9 million, $16 million and $12 million, respectively. We have not capitalized any equity-based compensation costs during the years ended December 31, 2009, 2008 and 2007. ...

  • Page 176
    ... Price Weighted Average Remaining Years $13.31-$20.00 ...$20.01-$30.00 ...$30.01-$39.93 ...$13.31-$39.93 ...Non-Employee Director Plans 1,525 7,006 267 8,798 $19.21 $27.18 $33.18 $25.98 2.87 2.91 2.77 2.90 Our non-employee directors currently receive annual grants of shares of our common stock...

  • Page 177
    ... funds that invest in United States government obligations with original maturities of three months or less. Available-for-Sale Securities Available for-sale securities are recorded at fair value based on quoted market prices. These assets include restricted trusts and escrow accounts invested in...

  • Page 178
    ...scheduled maturities of the derivatives. Refer to Note 8 for additional information regarding our interest rate derivatives. Foreign Currency Derivatives Our foreign currency derivatives are valued using forward Canadian dollar exchange prices at the reporting date. Counterparties to these contracts...

  • Page 179
    ..., asset impairments and unusual items" in our Statement of Operations. In 2008 and 2007, we completed several acquisitions for a cost, net of cash acquired, of $280 million and $90 million, respectively. Divestitures The aggregate sales price for divestitures of operations was $1 million in 2009...

  • Page 180
    ... landfills), transfer, waste-to-energy facilities and independent power production plants that are managed by Wheelabrator, recycling services and other services to commercial, industrial, municipal and residential customers throughout the United States and in Puerto Rico and Canada. The operations...

  • Page 181
    ... those elements of our in-plant services, landfill gas-to-energy operations and third-party sub-contract and administration revenues managed by our Upstream, Renewable Energy and National Accounts organizations that are not included with the operations of our reportable segments; (ii) our recycling...

  • Page 182
    ... year-end adjustments recorded in consolidation related to the reportable segments that were not included in the measure of segment profit or loss used to assess their performance for the periods disclosed. (b) Corporate operating results reflect the costs incurred for various support services...

  • Page 183
    ... respective geographic Group and our recycling brokerage business and electronics recycling services are included as part of our "Other" operations. The following table shows changes in goodwill during 2008 and 2009 by reportable segment on a realigned basis (in millions): Eastern Midwest Southern...

  • Page 184
    WASTE MANAGEMENT, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) Net operating revenues relating to operations in the United States and Puerto Rico, as well as Canada are as follows (in millions): Years Ended December 31, 2009 2008 2007 United States and Puerto Rico ...Canada ......

  • Page 185
    ...Waste Management, Inc." by $15 million, or $0.03 per diluted share. • Income from operations was negatively affected by (i) a $9 million charge to "Operating" expenses for a withdrawal of bargaining unit employees from an underfunded, multi-employer pension fund; (ii) $5 million of charges related...

  • Page 186
    ... their fair value as a result of our acquisition of a controlling financial interest in those operations; (iv) $4 million of charges related to our January 2009 restructuring; and (v) a $2 million impairment charge related to the abandonment of the SAP waste and recycling revenue management software...

  • Page 187
    ... agreements and the related withdrawal of the bargaining units from multi-employer pension plans; and (ii) a $33 million charge to "Operating" expenses as a result of a decrease in the risk-free interest rate used to discount our environmental remediation liabilities. The charge to "Operating...

  • Page 188
    ... TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) CONDENSED CONSOLIDATING BALANCE SHEETS December 31, 2009 WMI WM Holdings Non-Guarantor Subsidiaries Eliminations Consolidated ASSETS Current assets: Cash and cash equivalents ...Other current assets ...Property and equipment, net ...Investments in...

  • Page 189
    ... FINANCIAL STATEMENTS - (Continued) CONDENSED CONSOLIDATING BALANCE SHEETS (Continued) December 31, 2008 WMI WM Holdings Non-Guarantor Subsidiaries Eliminations Consolidated ASSETS Current assets: Cash and cash equivalents ...Other current assets ...Property and equipment, net ...Investments in...

  • Page 190
    WASTE MANAGEMENT, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS WMI WM Holdings Non-Guarantor Subsidiaries Eliminations Consolidated Year Ended December 31, 2009 Operating revenues ...$ Costs and expenses ...Income from operations ......

  • Page 191
    WASTE MANAGEMENT, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS (Continued) WMI WM Holdings Non-Guarantor Subsidiaries Eliminations Consolidated Year Ended December 31, 2007 Operating revenues ...$ Costs and expenses ...Income from ...

  • Page 192
    ...divestitures of businesses (net of cash divested) and other sales of assets ...Net receipts from restricted trust and escrow accounts and other, net ...Net cash used in investing activities ...Cash flows from financing activities: New borrowings ...Debt repayments ...Common stock repurchases ...Cash...

  • Page 193
    ... divestitures of businesses (net of cash divested) and other sales of assets ...Net receipts from restricted trust and escrow accounts and other, net ...Net cash used in investing activities...Cash flows from financing activities: New borrowings ...Debt repayments ...Common stock repurchases ...Cash...

  • Page 194
    ... divestitures of businesses (net of cash divested) and other sales of assets ...Purchases of short-term investments ...Proceeds from sales of short-term investments ...Net receipts from restricted trust and escrow accounts and other, net ...Net cash provided by (used in) investing activities ...Cash...

  • Page 195
    WASTE MANAGEMENT, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) 24. New Accounting Pronouncements (Unaudited) Consolidation of Variable Interest Entities - In June 2009, the FASB issued revised authoritative guidance associated with the consolidation of variable interest entities. ...

  • Page 196
    ..., our internal control over financial reporting. Item 9B. Other Information. None. PART III Item 10. Directors, Executive Officers and Corporate Governance. The information required by this Item is incorporated by reference to the Company's definitive Proxy Statement for its 2010 Annual Meeting of...

  • Page 197
    ...directors or executive officers. The Broad-Based Plan allows for the granting of equity awards on such terms and conditions as the Management Development and Compensation Committee may decide; provided that the exercise price of options may not be less than 100% of the fair market value of the stock...

  • Page 198
    ... Accounting Fees and Services. The information required by this Item is set forth in the 2010 Proxy Statement and is incorporated herein by reference. PART IV Item 15. Exhibits, Financial Statement Schedules (a) (1) Consolidated Financial Statements: Reports of Independent Registered Public...

  • Page 199
    ..., thereunto duly authorized. WASTE MANAGEMENT, INC. By: /s/ DAVID P. STEINER David P. Steiner Chief Executive Officer and Director Date: February 16, 2010 Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of...

  • Page 200
    ...PUBLIC ACCOUNTING FIRM The Board of Directors and Stockholders of Waste Management, Inc. We have audited the consolidated financial statements of Waste Management, Inc. as of December 31, 2009 and 2008, and for each of the three years in the period ended December 31, 2009, and have issued our report...

  • Page 201
    WASTE MANAGEMENT, INC. SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS (In Millions) Balance Beginning of Year Charged (Credited) to Income Accounts Written Off/Use of Reserve Balance End of Year Other(a) 2007 - Reserves for doubtful accounts(b) ...2008 - Reserves for doubtful accounts(b) ...2009 ...

  • Page 202
    ... Annual Meeting of Stockholders]. 1997 Employee Stock Purchase Plan [Incorporated by reference to Appendix C to the Proxy Statement for the 2006 Annual Meeting of Stockholders]. Waste Management, Inc. 409A Deferral Savings Plan. [Incorporated by reference to Exhibit 10.4 to Form 10-K for the year...

  • Page 203
    ... Financial Officer. 101* - The following materials from Waste Management, Inc.'s Annual Report on Form 10-K for the period ended December 31, 2009, formatted in XBRL (Extensible Business Reporting Language): (i) the Consolidated Balance Sheets; (ii) the Consolidated Statements of Operations; (iii...

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  • Page 207
    ... Relations at the corporate address or call (713) 512-6574. ANNUAL MEETING The annual meeting of the shareholders of the Company is scheduled to be held at 11:00 a.m. on May 11, 2010, at: The Maury Myers Conference Center Waste Management, Inc. 1021 Main Street Houston, Texas 77002 WEB SITE...

  • Page 208
    1001 Fannin, Suite 4000 • Houston, Texas 77002 www.wm.com