Waste Management 2015 Annual Report Download - page 170

WASTE MANAGEMENT, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
At the date the financial statements were issued, Forms 5500 were not available for the plan years ended in
2015.
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 2015, 2014 and 2013, we recognized aggregate charges of $51 million, $4 million and $5
million, respectively, to “Operating” expenses for the withdrawal of certain bargaining units from multiemployer
pension plans. Refer to Note 11 for additional information related to our obligations to multiemployer plans for
which we have withdrawn or partially withdrawn.
Multiemployer Plan Benefits Other Than Pensions — During the years ended December 31, 2015, 2014 and
2013 the Company made contributions of $33 million, $34 million and $34 million, respectively, to
multiemployer health and welfare plans that also provide other postretirement employee benefits. Funding of
benefit payments for plan participants are made at rates as negotiated in the respective collective bargaining
agreements as costs are incurred.
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.
Management does not expect that any claims against or draws on these instruments would have a material
adverse effect on our consolidated financial statements. We have not experienced any unmanageable difficulty in
obtaining the required financial assurance instruments for our current operations. In an ongoing effort to mitigate
risks of future cost increases and reductions in available capacity, we continue to evaluate various options to
access cost-effective sources of financial assurance.
Insurance — We carry insurance coverage for protection of our assets and operations from certain risks
including automobile liability, general liability, real 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. Our exposure, however, could increase if our insurers are unable to meet their commitments on
a timely basis.
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