Waste Management (WM) 10-Q 2009 Q2 Quarterly report

EXHIBIT 12

WASTE MANAGEMENT, INC.

COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
(In Millions, Except Ratios)
(Unaudited)

	Six Months
	Ended
	June 30,
	2009			2008
Income before income taxes and losses in equity investments(a)	$	702		$	926
Fixed charges deducted from income:
Interest expense		212			227
Implicit interest in rents		19			19
		231			246
Earnings available for fixed charges(b)	$	933		$	1,172
Interest expense	$	212		$	227
Capitalized interest		8			8
Implicit interest in rents		19			19
Total fixed charges(b)	$	239		$	254
Ratio of earnings to fixed charges(a)		3.9	x		4.6	x

(a)

Our “Income before income taxes and losses in equity investments” for the six months ended June 30, 2009 has been negatively affected by (i) a pre-tax, non-cash charge of $49 million related to the abandonment of SAP software as our revenue management system; and (ii) a pre-tax charge of $43 million for our January 2009 restructuring. The effect of these non-recurring charges on our “Income before income taxes and losses in equity investments” should be considered when comparing the “Ratio of earnings to fixed charges” for the periods presented.

(b)

To the extent interest may be assessed by taxing authorities on any underpayment of income tax, such amounts are classified as a component of income tax expense in our Statements of Operations. For purposes of this disclosure, we have elected to exclude interest expense related to income tax matters from our measurements of “Earnings available for fixed charges” and “Total fixed charges” for all periods presented.