Waste Management 2013 Annual Report Download - page 203

WASTE MANAGEMENT, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(c) A multiemployer defined benefit pension plan that has been certified as endangered, seriously endangered or
critical may begin to levy a statutory surcharge on contribution rates. Once authorized, the surcharge is at
the rate of 5% for the first 12 months and 10% for any periods thereafter. Contributing employers, however,
may eliminate the surcharge by entering into a collective bargaining agreement that meets the requirements
of the applicable FIP or RP.
(d) The Company was listed in the Form 5500 of the multiemployer plans considered to be individually
significant as providing more than 5% of the total contributions for each of the following plans and plan
years:
Year Contributions to Plan
Exceeded 5% of Total Contributions
(as of Plan’s Year End)
Local 731 Private Scavengers and Garage Attendants Pension Trust
Fund ................................................. 9/30/2012 and 9/30/2011
Suburban Teamsters of Northern Illinois Pension Plan ........... 12/31/2012 and 12/31/2011
Teamsters Local 301 Pension Plan ........................... 12/31/2012 and 12/31/2011
At the date the financial statements were issued, Forms 5500 were not available for the plan years ended in
2013.
(e) The Company believes there are no collective bargaining agreements remaining that require continuing
contributions to this plan; however, this point is the subject of pending litigation with the trustees for the
Central States, Southeast and Southwest Areas Pension Plan.
Our portion of the projected benefit obligation, plan assets and unfunded liability of the multiemployer
pension plans is not material to our financial position. However, the failure of participating employers to remain
solvent could affect our portion of the plans’ unfunded liability. Specific benefit levels provided by union
pension plans are not negotiated with or known by the employer contributors.
In connection with our ongoing renegotiations of various collective bargaining agreements, we may discuss
and negotiate for the complete or partial withdrawal from one or more of these pension plans. Further, business
events, such as the discontinuation or nonrenewal of a customer contract, the decertification of a union, or
relocation, reduction or discontinuance of certain operations, which result in the decline of Company
contributions to a multiemployer pension plan could trigger a partial or complete withdrawal. In the event of a
withdrawal, we may incur expenses associated with our obligations for unfunded vested benefits at the time of
the withdrawal. In 2013 and 2012, we recognized aggregate charges of $5 million and $10 million, respectively,
to “Operating” expenses for the withdrawal of certain bargaining units from multiemployer pension plans. We
did not have similar charges in 2011. Refer to Note 11 for additional information related to our obligations to
multiemployer plans for which we have withdrawn or partially withdrawn.
11. Commitments and Contingencies
Financial Instruments — We have obtained letters of credit, surety bonds and insurance policies and have
established trust funds and issued financial guarantees to support tax-exempt bonds, contracts, performance of
landfill final capping, closure and post-closure requirements, environmental remediation and other obligations.
Letters of credit generally are supported by our $2.25 billion revolving credit facility and other credit facilities
established for that purpose. These facilities are discussed further in Note 7. Surety bonds and insurance policies
are supported by (i) a diverse group of third-party surety and insurance companies; (ii) an entity in which we
have a noncontrolling financial interest or (iii) wholly-owned insurance companies, the sole business of which is
to issue surety bonds and/or insurance policies on our behalf.
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