Waste Management (WM) 10-Q 30 Jul 09 2009 Q2 Quarterly report Financial data

Document and Company Informatio

Document and Company Information (USD $)
	6 Months Ended Jun. 30, 2009	Jul. 27, 2009	Jun. 30, 2008
Document and Company Information [Abstract]
Entity Registrant Name	Waste Management, Inc.
Entity Central Index Key	0000823768
Document Type	10-Q
Document Period End Date	2009-06-30
Amendment Flag	false
Amendment Description	N/A
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Public Float			$18,463,749,815
Entity Common Stock, Shares Outstanding (actual number)		492,689,736

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets (USD $)
In Millions	Jun. 30, 2009	Dec. 31, 2008
Current assets:
Cash and cash equivalents	$528	$480
Accounts receivable, net of allowance for doubtful accounts of $35 and $39, respectively	1,420	1,463
Other receivables	145	147
Parts and supplies	102	110
Deferred income taxes	85	39
Other assets	137	96
Total current assets	2,417	2,335
Property and equipment, net of accumulated depreciation and amortization of $13,681 and $13,273, respectively	11,262	11,402
Goodwill	5,524	5,462
Other intangible assets, net	178	158
Other assets	767	870
Total assets	20,148	20,227
Current liabilities:
Accounts payable	519	716
Accrued liabilities	1,017	1,034
Deferred revenues	455	451
Current portion of long-term debt	244	835
Total current liabilities	2,235	3,036
Long-term debt, less current portion	7,999	7,491
Deferred income taxes	1,504	1,484
Landfill and environmental remediation liabilities	1,359	1,360
Other liabilities	684	671
Total liabilities	13,781	14,042
Waste Management, Inc. stockholders' equity:
Common stock, $0.01 par value; 1,500,000,000 shares authorized; 630,282,461 shares issued	6	6
Additional paid-in capital	4,532	4,558
Retained earnings	5,747	5,631
Accumulated other comprehensive income	119	88
Treasury stock at cost, 138,113,207 and 139,546,915 shares, respectively	(4,336)	(4,381)
Total Waste Management, Inc. stockholders' equity	6,068	5,902
Noncontrolling interests	299	283
Total equity	6,367	6,185
Total liabilities and equity	$20,148	$20,227

1_Condensed Consolidated Balanc

Condensed Consolidated Balance Sheets (Parenthetical) (USD $)
In Millions, except Share data	Jun. 30, 2009	Dec. 31, 2008
Allowance for doubtful accounts	$35	$39
Accumulated depreciation and amortization	$13,681	$13,273
Common stock, par value	0.01	0.01
Common stock, shares authorized (actual number)	1,500,000,000	1,500,000,000
Common stock, shares issued (actual number)	630,282,461	630,282,461
Treasury stock, shares (actual number)	138,113,207	139,546,915

Condensed Consolidated Statemen

Condensed Consolidated Statements of Operations (USD $)
In Millions, except Per Share data	3 Months Ended Jun. 30, 2009	3 Months Ended Jun. 30, 2008	6 Months Ended Jun. 30, 2009	6 Months Ended Jun. 30, 2008
Operating revenues	$2,952	$3,489	$5,762	$6,755
Costs and expenses:
Operating	1,786	2,181	3,511	4,273
Selling, general and administrative	323	358	660	726
Depreciation and amortization	302	318	591	615
Restructuring	5	0	43	0
(Income) expense from divestitures, asset impairments and unusual items	2	0	51	(2)
Total costs and expenses	2,418	2,857	4,856	5,612
Income from operations	534	632	906	1,143
Other income (expense):
Interest expense	(107)	(105)	(212)	(227)
Interest income	3	4	7	9
Other, net	0	(1)	0	(3)
Total other income (expense)	(104)	(102)	(205)	(221)
Income before income taxes	430	530	701	922
Provision for income taxes	163	199	264	343
Consolidated net income	267	331	437	579
Less: Net income attributable to noncontrolling interests	(20)	(13)	(35)	(20)
Net income attributable to Waste Management, Inc.	$247	$318	$402	$559
Basic earnings per common share	0.5	0.65	0.82	1.13
Diluted earnings per common share	0.5	0.64	0.81	1.13
Cash dividends declared per common share	0.29	0.27	0.58	0.54

2_Condensed Consolidated Statem

Condensed Consolidated Statements of Cash Flows (USD $)
In Millions	6 Months Ended Jun. 30, 2009	6 Months Ended Jun. 30, 2008
Cash flows from operating activities:
Consolidated net income	$437	$579
Adjustments to reconcile consolidated net income to net cash provided by operating activities:
Depreciation and amortization	591	615
Deferred income tax provision	(35)	45
Interest accretion on landfill liabilities	39	38
Interest accretion on and discount rate adjustments to environmental remediation liabilities and recovery assets	(29)	4
Provision for bad debts	28	19
Equity-based compensation expense	9	25
Net gain on disposal of assets	(4)	(21)
Effect of (income) expense from divestitures, asset impairments and unusual items	51	(2)
Excess tax benefits associated with equity-based transactions	0	(7)
Change in operating assets and liabilities, net of effects of acquisitions and divestitures:
Receivables	22	(29)
Other current assets	(11)	(27)
Other assets	(3)	6
Accounts payable and accrued liabilities	(16)	(64)
Deferred revenues and other liabilities	(12)	(50)
Net cash provided by operating activities	1,067	1,131
Cash flows from investing activities:
Acquisitions of businesses, net of cash acquired	(59)	(127)
Capital expenditures	(583)	(486)
Proceeds from divestitures of businesses (net of cash divested) and other sales of assets	12	38
Net receipts from restricted trust and escrow accounts	71	91
Other	(4)	(15)
Net cash used in investing activities	(563)	(499)
Cash flows from financing activities:
New borrowings	908	971
Debt repayments	(1,014)	(1,001)
Common stock repurchases	0	(401)
Cash dividends	(285)	(266)
Exercise of common stock options	8	32
Excess tax benefits associated with equity-based transactions	0	7
Distributions paid to noncontrolling interests	(22)	(25)
Other	(51)	(88)
Net cash used in financing activities	(456)	(771)
Effect of exchange rate changes on cash and cash equivalents	0	1
Increase (decrease) in cash and cash equivalents	48	(138)
Cash and cash equivalents at beginning of period	480	348
Cash and cash equivalents at end of period	$528	$210

3_Condensed Consolidated Statem

Condensed Consolidated Statements of Changes in Equity (USD $)
In Millions, except Share data in Thousands	3 Months Ended Jun. 30, 2009	6 Months Ended Jun. 30, 2009	6 Months Ended Jun. 30, 2008	12 Months Ended Dec. 31, 2008	Dec. 31, 2007
Beginning Balance		$6,185	$6,102	$6,102
Net income	267	437	579	1,128
Unrealized losses resulting from changes in fair values of derivative instruments, net of taxes of $5 and $25 respectively		(7)		40
Realized losses on derivative instruments reclassified into earnings, net of taxes of $6 and $24 respectively		9		(39)
Unrealized gains on marketable securities, net of taxes of $0 and $4 respectively		3		(18)
Foreign currency translation adjustments		28		(127)
Change in funded status of defined benefit plan liabilities, net of taxes of $0 and $5 respectively		0		(8)
Other comprehensive income (loss)		33		(152)
Comprehensive income		470		976
Cash dividends declared		(285)		(531)
Equity-based compensation transactions, including dividend equivalents, net of taxes		18		106
Common stock repurchases		0		(410)
Cumulative effect of change in accounting principle		0		(1)
Distributions paid to noncontrolling interests		(22)		(56)
Other		1		(1)
Ending Balance	6,367	6,367		6,185	6,102
Common Stock
Beginning Balance		6	6	6
Shares, Beginning Balance (in thousands)		630,282	630,282	630,282
Ending Balance				6	6
Shares, Ending Balance (in thousands)				630,282	630,282
Additional Paid-In Capital
Beginning Balance		4,558	4,542	4,542
Equity-based compensation transactions, including dividend equivalents, net of taxes		(26)		16
Ending Balance	4,532	4,532		4,558	4,542
Treasury Stock
Beginning Balance		(4,381)	(4,065)	(4,065)
Shares, Beginning Balance (in thousands)		(139,547)	(130,164)	(130,164)
Equity-based compensation transactions, including dividend equivalents, net of taxes		45		94
Equity-based compensation transactions, including dividend equivalents, net of taxes, shares		1,430		2,995
Common stock repurchases		0		(410)
Common stock repurchases, shares (in thousands)		0		(12,390)
Other, shares		4		12
Ending Balance	(4,336)	(4,336)		(4,381)	(4,065)
Shares, Ending Balance (in thousands)	(138,113)	(138,113)		(139,547)	(130,164)
Retained Earnings
Beginning Balance		5,631	5,080	5,080
Net income		402		1,087
Cash dividends declared		(285)		(531)
Equity-based compensation transactions, including dividend equivalents, net of taxes		(1)		(4)
Cumulative effect of change in accounting principle		0		(1)
Ending Balance	5,747	5,747		5,631	5,080
Accumulated Other Comprehensive Income (Loss)
Beginning Balance		88	229	229
Unrealized losses resulting from changes in fair values of derivative instruments, net of taxes of $5 and $25 respectively		(7)		40
Realized losses on derivative instruments reclassified into earnings, net of taxes of $6 and $24 respectively		9		(39)
Unrealized gains on marketable securities, net of taxes of $0 and $4 respectively		1		(7)
Foreign currency translation adjustments		28		(127)
Change in funded status of defined benefit plan liabilities, net of taxes of $0 and $5 respectively		0		(8)
Ending Balance	119	119		88	229
Noncontrolling Interest
Beginning Balance		283	310	310
Net income		35		41
Unrealized gains on marketable securities, net of taxes of $0 and $4 respectively		2		(11)
Distributions paid to noncontrolling interests		(22)		(56)
Other		1		(1)
Ending Balance	299	299		283	310
Comprehensive Income
Net income		437		1,128
Unrealized losses resulting from changes in fair values of derivative instruments, net of taxes of $5 and $25 respectively		(7)		40
Realized losses on derivative instruments reclassified into earnings, net of taxes of $6 and $24 respectively		9		(39)
Unrealized gains on marketable securities, net of taxes of $0 and $4 respectively		3		(18)
Foreign currency translation adjustments		28		(127)
Change in funded status of defined benefit plan liabilities, net of taxes of $0 and $5 respectively		0		(8)
Other comprehensive income (loss)		33		(152)
Comprehensive income		$470		$976

4_Condensed Consolidated Statem

Condensed Consolidated Statements of Changes in Equity (Parenthetical) (USD $)
In Millions	6 Months Ended Jun. 30, 2009	12 Months Ended Dec. 31, 2008
Tax effects on unrealized gains resulting from changes in fair values of derivative instruments	$5	$25
Tax effects on realized gains on derivative instruments reclassified into earnings	6	24
Tax effects on unrealized losses on marketable securities	0	4
Tax effects on change in funded status of defined benefit plan liabilities	0	5
Accumulated Other Comprehensive Income (Loss)
Tax effects on unrealized gains resulting from changes in fair values of derivative instruments	5	25
Tax effects on realized gains on derivative instruments reclassified into earnings	6	24
Tax effects on unrealized losses on marketable securities	0	4
Tax effects on change in funded status of defined benefit plan liabilities	0	5
Noncontrolling Interest
Tax effects on unrealized losses on marketable securities	0
Comprehensive Income
Tax effects on unrealized gains resulting from changes in fair values of derivative instruments	5	25
Tax effects on realized gains on derivative instruments reclassified into earnings	6	24
Tax effects on unrealized losses on marketable securities	0	4
Tax effects on change in funded status of defined benefit plan liabilities	$0	$5

Basis of Presentation

Basis of Presentation
	6 Months Ended Jun. 30, 2009 USD / shares
Basis of Presentation [Abstract]
Basis of Presentation	1. Basis of Presentation The financial statements presented in this report represent the consolidation of Waste Management, Inc., a Delaware corporation; Waste Managements wholly-owned and majority-owned subsidiaries; and certain variable interest entities for which Waste Management or its subsidiaries are the primary beneficiary. Waste Management is a holding company and all operations are conducted by its subsidiaries. When the terms the Company, we, us or our are used in this document, those terms refer to Waste Management, Inc., its 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 manage and evaluate our principal operations through five operating Groups, of which four are organized by geographic area and one is organized by function. Our geographic operating Groups, which include our Eastern, Midwest, Southern and Western Groups, provide collection, transfer, recycling and disposal services. Our functional operating group is the Wheelabrator Group, which provides waste-to-energy services. We also provide additional waste management services that are not managed through our five Groups, which are presented in this report as Other. Additional information related to our segments, including changes in the basis for our reported segments from December31, 2008, can be found under Reclassifications below and in Note9. The Condensed Consolidated Financial Statements as of and for the three and six months ended June30, 2009 and 2008 are unaudited. In the opinion of management, these financial statements include all adjustments, which, unless otherwise disclosed, are of a normal recurring nature, necessary for a fair presentation of the financial position, results of operations, and cash flows for the periods presented. The results for interim periods are not necessarily indicative of results for the entire year. The financial statements presented herein should be read in connection with the financial statements included in our Annual Report on Form10-K for the year ended December31, 2008. In preparing our financial statements, we make numerous estimates and assumptions that affect the accounting for and recognition and disclosure of assets, liabilities, equity, revenues and expenses. We must make these estimates and assumptions because certain information that we use is dependent on future events, cannot be calculated with a high degree of precision from data available or simply cannot be readily calculated based on generally accepted methodologies. In some cases, these estimates are particularly difficult to determine and we must exercise significant judgment. In preparing our financial statements, the most difficult, subjective and complex estimates and the assumptions that deal with the greatest amount of uncertainty relate to our accounting for landfills, environmental remediation liabilities, asset impairments, and self-insurance reserves and recoveries. Actual results could differ materially from the estimates and assumptions that we use in the preparation of our financial stateme

Landfill and Environmental Reme

Landfill and Environmental Remediation Liabilities
	6 Months Ended Jun. 30, 2009 USD / shares
Landfill and Environmental Remediation Liabilities [Abstract]
Landfill and Environmental Remediation Liabilities	2. Landfill and Environmental Remediation Liabilities Liabilities for landfill and environmental remediation costs are presented in the table below (in millions): June30, 2009 December31, 2008 Environmental Environmental Landfill Remediation Total Landfill Remediation Total Current (in accrued liabilities) $ 113 $ 55 $ 168 $ 108 $ 49 $ 157 Long-term 1,142 217 1,359 1,110 250 1,360 $ 1,255 $ 272 $ 1,527 $ 1,218 $ 299 $ 1,517 The changes to landfill and environmental remediation liabilities for the year ended December31, 2008 and the six months ended June30, 2009 are reflected in the table below (in millions): Environmental Landfill Remediation December31, 2007 $ 1,178 $ 284 Obligations incurred and capitalized 51 Obligations settled (72 ) (38 ) Interest accretion 77 8 Revisions in estimates (13 ) 49 Acquisitions, divestitures and other adjustments (3 ) (4 ) December31, 2008 1,218 299 Obligations incurred and capitalized 19 Obligations settled (27 ) (15 ) Interest accretion 39 3 Revisions in estimates(a) 4 (17 ) Acquisitions, divestitures and other adjustments 2 2 June30, 2009 $ 1,255 $ 272 (a) The revisions in estimates associated with our environmental remediation liabilities were primarily related to the impact of changes in the risk-free discount rate used to measure the liabilities. As of December31, 2008, we used a risk-free discount rate for these obligations of 2.25%. The applicable rate increased to 3.50% as of June30, 2009. The change in discount rate resulted in a $23million decrease to our environmental remediation liabilities and a corresponding reduction to Operating expenses for the six months ended June30, 2009. At several of our landfills, we provide financial assurance by depositing cash into restricted trust funds or escrow accounts for purposes of settling closure, post-closure and environmental remediation obligations. The fair value of these escrow accounts and trust funds was $220million at June30, 2009, and is primarily included as long-term Other assets in our Condensed Consolidated Balance Sheet.

Debt

Debt
	6 Months Ended Jun. 30, 2009 USD / shares
Debt [Abstract]
Debt	3. Debt The following table summarizes the major components of debt at each balance sheet date (in millions) and provides the maturities and interest rates of each major category as of June30, 2009: June30, December31, 2009 2008 Revolving credit facility (weighted average interest rate of 2.4% at December31, 2008) $ $ 300 Letter of credit facilities Canadian credit facility (weighted average interest rate of 2.1% at June30, 2009 and 3.3% at December31, 2008) 247 242 Senior notes and debentures, maturing through 2032, interest rates ranging from 5.0% to 7.75% (weighted average interest rate of 6.9% at June30, 2009 and 6.8% at December31, 2008) 4,876 4,628 Tax-exempt bonds maturing through 2039, fixed and variable interest rates ranging from 0.1% to 7.4% (weighted average interest rate of 3.6% at June30, 2009 and 3.9% at December31, 2008) 2,648 2,684 Tax-exempt project bonds, principal payable in periodic installments, maturing through 2029, fixed and variable interest rates ranging from 0.3% to 9.3% (weighted average interest rate of 4.5% at June30, 2009 and 4.9% at December31, 2008) 219 220 Capital leases and other, maturing through 2050, interest rates up to 12% 253 252 Total long-term debt 8,243 8,326 Current portion of long-term debt 244 835 Long-term debt, less current portion $ 7,999 $ 7,491 As of June30, 2009, we had $401million of debt maturing within twelve months and $617million of fixed-rate tax-exempt bonds and $39million of fixed-rate tax-exempt project bonds subject to remarketing within the next twelve months. We have classified $244million of these borrowings as current portion of long-term debt; the remaining $813million is classified as long-term as of June30, 2009 based on our intent and ability, given the capacity available under our revolving credit facility and Canadian credit facility, to refinance these borrowings on a long-term basis. The significant changes in our debt balances from December31, 2008 to June30, 2009 are related to the following: Revolving credit facility We repaid the $300million of outstanding borrowings with proceeds from the issuance of senior notes as discussed below. Canadian credit facility The increase in the carrying value of this obligation is due to (i)accounting for changes in the Canadian currency translation rate, which increased the carrying value of this debt by $12million during the six months ended June30, 2009, and (ii)the impact of interest accretion, which increased the carrying value of this debt by $3million during the six months ended June30, 2009. These increases were partially offset by $10million of debt repayments. As of June30, 2009 and December31, 2008, $230million and $209million, respectively, of these advances were classified as long-term based on our intent

Income Taxes

Income Taxes
	6 Months Ended Jun. 30, 2009 USD / shares
Income Taxes [Abstract]
Income Taxes	4. Income Taxes Our effective tax rate for the three and six months ended June30, 2009 was 37.9% and 37.6%, respectively, compared with 37.5% and 37.2%, respectively, for the comparable prior-year periods. As a result of our adoption of SFASNo.160, the measurement of our effective tax rate has changed from previous years. This change is a result of an increase in our Income before income taxes because of the exclusion from this measure of Net income attributable to noncontrolling interests, or what was previously referred to as Minority interest expense. Our 2008 effective tax rate has been remeasured and reported in a manner consistent with the current measurement approach. Amounts reported as Net income attributable to noncontrolling interests are reported net of any applicable taxes. The difference between federal income taxes computed at the federal statutory rate and reported income taxes for the three- and six- month periods ended June30, 2009 and 2008 is primarily due to state and local income taxes. For the three and six months ended June30, 2008, the increase from state and local income taxes was offset, in part, by the favorable impact of tax audit settlements, which reduced our provision for income taxes by $7million and $13million, respectively. Our provision for income taxes for the six months ended June30, 2008 also included a tax benefit of $3million for the final true-up of our 2007 non-conventional fuel tax credits. We evaluate our effective tax rate at each interim period and adjust it accordingly as facts and circumstances warrant.

Comprehensive Income

Comprehensive Income
	6 Months Ended Jun. 30, 2009 USD / shares
Comprehensive Income [Abstract]
Comprehensive Income	5. Comprehensive Income Comprehensive income was as follows (in millions): Three Months Six Months Ended Ended June30, June30, 2009 2008 2009 2008 Consolidated net income $ 267 $ 331 $ 437 $ 579 Other comprehensive income (loss), net of taxes: Unrealized losses resulting from changes in fair value of derivative instruments, net of taxes (15 ) (9 ) (7 ) (3 ) Realized (gains) losses on derivative instruments reclassified into earnings, net of taxes 16 4 9 (1 ) Unrealized gains (losses) on marketable securities, net of taxes 6 (2 ) 3 (5 ) Foreign currency translation adjustments 49 5 28 (17 ) Other comprehensive income (loss) 56 (2 ) 33 (26 ) Comprehensive income 323 329 470 553 Comprehensive income attributable to noncontrolling interests (24 ) (12 ) (37 ) (17 ) Comprehensive income attributable to Waste Management, Inc. $ 299 $ 317 $ 433 $ 536 The components of accumulated other comprehensive income, which is included as a component of Waste Management, Inc. stockholders equity, were as follows (in millions): June30, December31, 2009 2008 Accumulated unrealized loss on derivative instruments, net of taxes $ (17 ) $ (19 ) Accumulated unrealized loss on marketable securities, net of taxes (1 ) (2 ) Cumulative foreign currency translation adjustments 141 113 Underfunded post-retirement benefit obligations, net of taxes (4 ) (4 ) $ 119 $ 88

Earnings Per Share

Earnings Per Share
	6 Months Ended Jun. 30, 2009 USD / shares
Earnings Per Share [Abstract]
Earnings Per Share	6. Earnings Per Share Basic and diluted earnings per share were computed using the following common share data (shares in millions): Three Months Six Months Ended Ended June30, June30, 2009 2008 2009 2008 Number of common shares outstanding at end of period 492.2 490.2 492.2 490.2 Effect of using weighted average common shares outstanding 0.2 0.5 (0.1 ) 3.1 Weighted average basic common shares outstanding 492.4 490.7 492.1 493.3 Dilutive effect of equity-based compensation awards and other contingently issuable shares 1.3 3.9 1.5 3.3 Weighted average diluted common shares outstanding 493.7 494.6 493.6 496.6 Potentially issuable shares 14.2 16.5 14.2 16.5 Number of anti-dilutive potentially issuable shares excluded from diluted common shares outstanding 5.4 1.9 3.3 1.9

Commitments and Contingencies

Commitments and Contingencies
	6 Months Ended Jun. 30, 2009 USD / shares
Commitments and Contingencies [Abstract]
Commitments and Contingencies	7. Commitments and Contingencies Financial instruments We have obtained letters of credit, performance bonds and insurance policies and have established trust funds and issued financial guarantees to support tax-exempt bonds, contracts, performance of landfill closure and post-closure requirements, environmental remediation, and other obligations. Letters of credit generally are supported by our revolving credit facility and other credit facilities established for that purpose. We obtain surety bonds and insurance policies from an entity in which we have a non-controlling financial interest. We also obtain insurance from a wholly-owned insurance company, the sole business of which is to issue policies for us. In those instances where our use of financial assurance from entities we own or have financial interests in is not allowed, we generally have available alternative financial assurance mechanisms. Management does not expect to have any claims against or draws on these instruments that would have a material adverse effect on our consolidated financial statements and we have not experienced any unmanageable difficulty in obtaining the required financial assurance instruments for our current operations. 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 were unable to meet their commitments on a timely basis. We have retained a significant portion of the risks related to our automobile, general liability and workers compensation insurance programs. For our self-insured retentions, the exposure for unpaid claims and associated expenses, including incurred but not reported losses, is based on an actuarial valuation and internal estimates. The estimated accruals for these liabilities could be affected if future occurrences or loss development significantly differ from the assumptions used. We do not expect the impact of any known casualty, property, environmental or other contingency to have a material impact on our financial condition, results of operations or cash flows. Guarantees In the ordinary course of our business, WMI and WMHoldings enter into guarantee agreements associated with their subsidiaries operations. Additionally, WMI and WMHoldings have each guaranteed all of the senior debt of the other entity. No additional liabilities have been recorded for these intercompany guarantees because all of the underlying obligations are reflected in our Condensed Consolidated Balance Sheets. We also have guaranteed the obligations of and provided indemnification to third parties in the ordinary course of business. Guarantee agreements outstanding as of June30, 2009 include guarantees of unconsolidated entities financial obligations maturing through 2

Restructuring

Restructuring
	6 Months Ended Jun. 30, 2009 USD / shares
Restructuring [Abstract]
Restructuring	8. Restructuring In January 2009, we took steps to further streamline our organization by (i)consolidating many of our Market Areas; (ii)integrating the management of our recycling operations with the remainder of our solid waste business; and (iii)realigning our Corporate organization with this new structure in order to provide support functions more efficiently. Our principal operations are managed through our Groups, which are discussed in Note9. Each of our geographic Groups had been further divided into several Market Areas. As a result of our restructuring, the 45 separate Market Areas that we previously operated have been consolidated into 25 Areas. We have found that our larger Market Areas generally were able to achieve efficiencies through economies of scale that were not present in our smaller Market Areas, and believe that this reorganization will allow us to lower costs and continue 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, or WMRA, organization to our geographic Groups. By integrating the management of these recycling services with the remainder of our solid waste business, we will be able to more efficiently provide comprehensive environmental solutions to our customers. In addition, as a result of this realignment, we have significantly reduced the overhead costs associated with managing this portion of our business and have increased the geographic Groups focus on maximizing the profitability and return on invested capital of all aspects of our business. This reorganization has eliminated over 1,500employee positions throughout the Company. During the three and six months ended June30, 2009, we recognized $5million and $43million, respectively, of pre-tax restructuring charges associated with this reorganization of which $2million and $38million, respectively, were related to employee severance and benefit costs. The remaining charges were primarily related to abandoned operating lease agreements. The following table summarizes the charges recognized for this restructuring by each of our current reportable segments and our Corporate organization (in millions): Three Months Ended Six Months Ended June30, 2009 June30, 2009 Eastern $ 2 $ 10 Midwest 1 9 Southern 1 9 Western 1 6 Wheelabrator Corporate 9 Total $ 5 $ 43 Through June30, 2009, we had paid approximately $25million of the employee severance and benefit costs incurred as a result of this restructuring. The length of time we are obligated to make severance payments varies, with the longest obligation continuing through the third quarter of 2010. We currently expect to incur additional restructuring charges of up to $10mil

Segment and Related Information

Segment and Related Information
	6 Months Ended Jun. 30, 2009 USD / shares
Segment and Related Information [Abstract]
Segment and Related Information	9. Segment and Related Information We currently manage and evaluate our operations primarily through our Eastern, Midwest, Southern, Western and Wheelabrator Groups. These five Groups are presented below as our reportable segments. Our segments provide integrated waste management services consisting of collection, disposal (solid waste and hazardous waste 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 not managed through our five operating Groups are presented herein as Other. As a result of the transfer of responsibility for the oversight of day-to-day recycling operations at our material recovery facilities and secondary processing facilities to the management teams of our geographic Groups, we also changed the way we review the financial results of our geographic Groups. Beginning in 2009, the financial results of our material recovery facilities and secondary processing facilities are included as a component of their respective geographic Group or segment and the financial results of our recycling brokerage business and electronics recycling services are included as part of our Other operations. We have reflected the impact of this change for all periods presented to provide financial information that consistently reflects our current approach to managing our geographic Group operations. Summarized financial information concerning our reportable segments for the three and six months ended June 30 is shown in the following tables (in millions): Gross Intercompany Net Operating Operating Operating Income from Three Months Ended: Revenues Revenues Revenues Operations June30, 2009 Eastern $ 756 $ (143 ) $ 613 $ 119 Midwest 723 (112 ) 611 116 Southern 840 (111 ) 729 191 Western 785 (104 ) 681 146 Wheelabrator 212 (32 ) 180 54 Other 146 (8 ) 138 (28 ) 3,462 (510 ) 2,952 598 Corporate and Other (64 ) Total $ 3,462 $ (510 ) $ 2,952 $ 534 June30, 2008 Eastern $ 884 $ (163 ) $ 721 $ 150 Midwest 881 (129 ) 752 144 Southern 957 (128 ) 829 216 Western 872 (110 ) 762

Sheet1

(Income) Expense from Divestitures, Asset Impairments and Unusual Items
	6 Months Ended Jun. 30, 2009 USD / shares
(Income) Expense from Divestitures, Asset Impairments and Unusual Items [Abstract]
(Income) Expense from Divestitures, Asset Impairments and Unusual Items	10. (Income) Expense from Divestitures, Asset Impairments and Unusual Items As of December31, 2008, our Property and equipment included $70million of accumulated costs associated with the development of our waste and recycling revenue management system. Approximately $49million of these costs were specifically associated with the purchase of the license of SAPs waste and recycling revenue management software and the efforts required to develop and configure that software for our use. The remaining costs were associated with the general efforts of integrating a revenue management system with our existing applications and hardware. After a failed pilot implementation of the software in one of our smallest market areas, the development efforts associated with this revenue management system were suspended in 2007. As disclosed in Note7, in March 2008, we filed suit against SAP and have been assigned a trial date of March 2010. During the first quarter of 2009, we determined to enhance and improve our existing revenue management system and not pursue alternatives associated with the development and implementation of a revenue management system that would include the licensed SAP software. Accordingly, after careful consideration of the failures of the SAP software, we determined to abandon any alternative that would include the use of the SAP software. The determination to abandon the SAP software as our revenue management system resulted in a non-cash charge of $49million. During the second quarter of 2009, we recognized a $2million impairment charge due to a change in expectations for the operating life of a landfill in our Southern Group.

Fair Value Measurements

Fair Value Measurements
	6 Months Ended Jun. 30, 2009 USD / shares
Fair Value Measurements [Abstract]
Fair Value Measurements	11. Fair Value Measurements Assets and Liabilities Accounted for at Fair Value SFASNo.157 provides a framework for measuring fair value and establishes a fair value hierarchy that prioritizes the inputs used to measure fair value, giving the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level1 inputs) and the lowest priority to unobservable inputs (Level3 inputs). We use valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs. In measuring the fair value of our assets and liabilities, we use market data or assumptions that we believe market participants would use in pricing an asset or liability, including assumptions about risk when appropriate. As of June30, 2009, our assets that are measured at fair value on a recurring basis include the following (in millions): Fair Value Measurements Using Quoted Significant Prices in Other Significant Active Observable Unobservable Markets Inputs Inputs Total (Level 1) (Level 2) (Level 3) Assets: Cash equivalents(a) $ 467 $ 467 $ $ Available-for-sale securities(b) 329 329 Interest rate derivatives(c),(d) 52 52 Foreign currency derivatives(e) 16 16 Total assets $ 864 $ 796 $ 68 $ (a) Our cash equivalents consist primarily of money market funds that invest in United States government obligations with original maturities of three months or less. (b) These assets include (i)restricted trusts and escrow accounts invested in money market mutual funds; (ii)restricted trusts and escrow accounts invested in equity-based mutual funds; and (iii)other equity securities. (c) We use interest rate swaps to maintain a strategic portion of our debt obligations at variable, market-driven interest rates. As of June30, 2009, we had approximately $4.8billion in fixed-rate senior notes outstanding. The interest payments on $1.5billion of these senior notes have been swapped to variable interest rates to protect the debt against changes in fair value due to changes in benchmark interest rates. We have designated our interest rate swaps as fair value hedges of our fixed-rate senior notes. The following table summarizes the impact of our interest rate derivatives on our balance sheet as of June30, 2009 (in millions): Derivatives Designated as Hedging Instruments Under SFAS No. 133 Balance Sheet Location Fair Value Interest rate contracts Current other assets $ Interest rate contracts Long-term other assets $ 52 Gains or losses

Condensed Consolidating Financi

Condensed Consolidating Financial Statements
	6 Months Ended Jun. 30, 2009 USD / shares
Condensed Consolidating Financial Statements [Abstract]
Condensed Consolidating Financial Statements	12. Condensed Consolidating Financial Statements WMHoldings has fully and unconditionally guaranteed all of WMIs senior indebtedness. WMI has fully and unconditionally guaranteed all of WMHoldings senior indebtedness. None of WMIs other subsidiaries have guaranteed any of WMIs or WMHoldings debt. As a result of these guarantee arrangements, we are required to present the following condensed consolidating financial information (in millions): CONDENSED CONSOLIDATING BALANCE SHEETS June30, 2009 (Unaudited) WM Non-Guarantor WMI Holdings Subsidiaries Eliminations Consolidated ASSETS Current assets: Cash and cash equivalents $ 459 $ $ 69 $ $ 528 Other current assets 10 1 1,878 1,889 469 1 1,947 2,417 Property and equipment, net 11,262 11,262 Investments in and advances to affiliates 9,998 12,098 1,713 (23,809 ) Other assets 77 17 6,375 6,469 Total assets $ 10,544 $ 12,116 $ 21,297 $ (23,809 ) $ 20,148 LIABILITIES AND EQUITY Current liabilities: Current portion of long-term debt $ 17 $ 35 $ 192 $ $ 244 Accounts payable and other current liabilities 89 17 1,885 1,991 106 52 2,077 2,235 Long-term debt, less current portion 4,370 603 3,026 7,999 Other liabilities 3,547 3,547 Total liabilities 4,476 655 8,650 13,781 Equity: Stockholders equity 6,068 11,461 12,348 (23,809 ) 6,068 Noncontrolling interests 299 299 6,068 11,461 12,647 (23,809 ) 6,367 Total liabilities and equity $ 10,544 $ 12,116 $ 21,297 $ (23,809 ) $ 20,148 December31, 2008 WM

New Accounting Pronouncement Pe

New Accounting Pronouncement Pending Adoption
	6 Months Ended Jun. 30, 2009 USD / shares
New Accounting Pronouncement Pending Adoption [Abstract]
New Accounting Pronouncement Pending Adoption	13. New Accounting Pronouncement Pending Adoption In June 2009, the FASB issued SFASNo.167, Amendments to FASB Interpretation No.46(R). SFASNo.167 replaces FIN46s quantitative-based assessment for determining which enterprise has a controlling interest in a variable interest entity with an approach that is primarily qualitative. This qualitative approach focuses on identifying the enterprise that has (i)the power to direct the activities of the variable interest entity that can most significantly impact the entitys performance; and (ii)the obligation to absorb losses and the right to receive benefits from the entity that could potentially be significant to the variable interest entity. SFASNo.167 also requires an ongoing assessment of whether an enterprise is the primary beneficiary of a variable interest entity rather than a reassessment only upon the occurrence of specific events as currently required by FIN46. SFASNo.167 is effective for the Company January1, 2010. We currently are in the process of assessing the provisions of SFASNo.167 and have not determined whether the adoption of SFASNo.167 will have a material impact on our consolidated financial statements.