Waste Management 2011 Annual Report Download - page 99

We may be unable to obtain or maintain required permits or to expand existing permitted capacity of our
landfills, which could decrease our revenue and increase our costs.
Our ability to meet our financial and operating objectives depends in part on our ability to obtain and
maintain the permits necessary to operate landfill sites. Permits to build, operate and expand solid waste
management facilities, including landfills and transfer stations, have become more difficult and expensive to
obtain and maintain. Permits often take years to obtain as a result of numerous hearings and compliance
requirements with regard to zoning, environmental and other regulations. These permits are also often subject to
resistance from citizen or other groups and other political pressures. Local communities and citizen groups,
adjacent landowners or governmental agencies may oppose the issuance of a permit or approval we may need,
allege violations of the permits under which we currently operate or laws or regulations to which we are subject,
or seek to impose liability on us for environmental damage. Responding to these challenges has, at times,
increased our costs and extended the time associated with establishing new facilities and expanding existing
facilities. In addition, failure to receive regulatory and zoning approval may prohibit us from establishing new
facilities or expanding existing facilities. Our failure to obtain the required permits to operate our landfills could
have a material adverse impact on our consolidated financial condition, results of operations and cash flows.
Significant shortages in fuel supply or increases in fuel prices will increase our operating expenses.
The price and supply of fuel can fluctuate significantly based on international, political and economic
circumstances, as well as other factors outside our control, such as actions by the Organization of the Petroleum
Exporting Countries, or OPEC, and other oil and gas producers, regional production patterns, weather conditions
and environmental concerns. We have seen average quarterly fuel prices increase by as much as 33% on a
year-over-year basis and decrease by as much as 47% on a year-over-year basis within the last three years. We
need fuel to run our collection and transfer trucks and our equipment used in our landfill operations. Supply
shortages could substantially increase our operating expenses. Additionally, as fuel prices increase, our direct
operating expenses increase and many of our vendors raise their prices as a means to offset their own rising costs.
We have in place a fuel surcharge program, designed to offset increased fuel expenses; however, we may not be
able to pass through all of our increased costs and some customers’ contracts prohibit any pass-through of the
increased costs. Additionally, we are currently party to a pending litigation that pertains to our fuel and
environmental charge and generally alleges that such charges were not properly disclosed, were unfair, and were
contrary to contract. See Note 11 of the Consolidated Financial Statements for more information. Regardless of
any offsetting surcharge programs, the increased operating costs will decrease our operating margins.
We are increasingly dependent on technology in our operations and if our technology fails, our business
could be adversely affected.
We may experience problems with the operation of our current information technology systems or the
technology systems of third parties on which we rely, as well as the development and deployment of new
information technology systems, that could adversely affect, or even temporarily disrupt, all or a portion of our
operations until resolved. Inabilities and delays in implementing new systems can also affect our ability to realize
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.
A cybersecurity incident could negatively impact our business and our relationships with customers.
We use computers in substantially all aspects of our business operations. We also use mobile devices, social
networking and other online activities to connect with our employees and our customers. Such uses give rise to
cybersecurity risks, including security breach, espionage, system disruption, theft and inadvertent release of
information. Our business involves the storage and transmission of numerous classes of sensitive and/or
confidential information and intellectual property, including customers’ personal information, private
information about employees, and financial and strategic information about the Company and its business
partners. We also rely on a Payment Card Industry compliant third party to protect our customers’ credit card
information. Further, as the Company pursues its strategy to grow through acquisitions and to pursue new
initiatives that improve our operations and cost structure, the Company is also expanding and improving its
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