Document and Company Information (USD $)	9 Months Ended
Document and Company Information (USD $)	Sep. 30, 2009	Oct. 26, 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	Sep. 30, 2009
Amendment Flag	false
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)		489,651,990

Condensed Consolidated Balance Sheets (USD $) In Millions, unless otherwise specified	9 Months Ended	12 Months Ended
	Sep. 30, 2009	Dec. 31, 2008
Current assets:
Cash and cash equivalents	$ 612	$ 480
Accounts receivable, net of allowance for doubtful accounts of $32 and $39, respectively	1,459	1,463
Other receivables	154	147
Parts and supplies	106	110
Deferred income taxes	56	39
Other assets	123	96
Total current assets	2,510	2,335
Property and equipment, net of accumulated depreciation and amortization of $13,929 and $13,273, respectively	11,356	11,402
Goodwill	5,575	5,462
Other intangible assets, net	206	158
Other assets	745	870
Total assets	20,392	20,227
Current liabilities:
Accounts payable	554	716
Accrued liabilities	1,062	1,034
Deferred revenues	447	451
Current portion of long-term debt	742	835
Total current liabilities	2,805	3,036
Long-term debt, less current portion	7,504	7,491
Deferred income taxes	1,518	1,484
Landfill and environmental remediation liabilities	1,361	1,360
Other liabilities	683	671
Total liabilities	13,871	14,042
Commitments and contingencies
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	4,534	4,558
Retained earnings	5,880	5,631
Accumulated other comprehensive income	178	88
Treasury stock at cost, 139,719,246 and 139,546,915 shares, respectively	(4,382)	(4,381)
Total Waste Management, Inc. stockholders' equity	6,216	5,902
Noncontrolling interests	305	283
Total equity	6,521	6,185
Total liabilities and equity	$ 20,392	$ 20,227

Condensed Consolidated Balance Sheets (Parenthetical) (USD $) In Millions, except Share data, unless otherwise specified	Sep. 30, 2009	Dec. 31, 2008
Allowance for doubtful accounts	$ 32	$ 39
Accumulated depreciation and amortization	$ 13,929	$ 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)	139,719,246	139,546,915

Condensed Consolidated Statements of Operations (Unaudited) (USD $) In Millions, except Per Share data, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2009	Sep. 30, 2008	Sep. 30, 2009	Sep. 30, 2008
Operating revenues	$ 3,023	$ 3,525	$ 8,785	$ 10,280
Costs and expenses:
Operating	1,856	2,221	5,367	6,494
Selling, general and administrative	339	369	999	1,095
Depreciation and amortization	301	326	892	941
Restructuring	3	0	46	0
(Income) expense from divestitures, asset impairments and unusual items	(1)	(23)	50	(25)
Total costs and expenses	2,498	2,893	7,354	8,505
Income from operations	525	632	1,431	1,775
Other income (expense):
Interest expense	(104)	(114)	(316)	(341)
Interest income	3	5	10	14
Other, net	1	1	1	(2)
Total other income (expense)	(100)	(108)	(305)	(329)
Income before income taxes	425	524	1,126	1,446
Provision for income taxes	133	201	397	544
Consolidated net income	292	323	729	902
Less: Net income attributable to noncontrolling interests	(15)	(13)	(50)	(33)
Net income attributable to Waste Management, Inc.	$ 277	$ 310	$ 679	$ 869
Basic earnings per common share	$ 0.56	$ 0.63	$ 1.38	$ 1.76
Diluted earnings per common share	$ 0.56	$ 0.63	$ 1.37	$ 1.75
Cash dividends declared per common share	$ 0.29	$ 0.27	$ 0.87	$ 0.81

Condensed Consolidated Statements of Cash Flows (Unaudited) (USD $) In Millions, unless otherwise specified	9 Months Ended
	Sep. 30, 2009	Sep. 30, 2008
Cash flows from operating activities:
Consolidated net income	$ 729	$ 902
Adjustments to reconcile consolidated net income to net cash provided by operating activities:
Depreciation and amortization	892	941
Deferred income tax provision	(10)	83
Interest accretion on landfill liabilities	59	57
Interest accretion on and discount rate adjustments to environmental remediation liabilities and recovery assets	(28)	6
Provision for bad debts	37	32
Equity-based compensation expense	19	38
Net gain on disposal of assets	(6)	(25)
Effect of (income) expense from divestitures, asset impairments and unusual items	50	(25)
Excess tax benefits associated with equity-based transactions	(2)	(7)
Change in operating assets and liabilities, net of effects of acquisitions and divestitures:
Receivables	(17)	35
Other current assets	(19)	(29)
Other assets	1	3
Accounts payable and accrued liabilities	2	(26)
Deferred revenues and other liabilities	(65)	(83)
Net cash provided by operating activities	1,642	1,902
Cash flows from investing activities:
Acquisitions of businesses, net of cash acquired	(127)	(230)
Capital expenditures	(823)	(787)
Proceeds from divestitures of businesses (net of cash divested) and other sales of assets	20	92
Net receipts from restricted trust and escrow accounts	98	142
Other	2	7
Net cash used in investing activities	(830)	(776)
Cash flows from financing activities:
New borrowings	1,026	1,091
Debt repayments	(1,142)	(1,206)
Common stock repurchases	(65)	(410)
Cash dividends	(428)	(399)
Exercise of common stock options	10	36
Excess tax benefits associated with equity-based transactions	2	7
Distributions paid to noncontrolling interests	(35)	(33)
Other	(51)	(56)
Net cash used in financing activities	(683)	(970)
Effect of exchange rate changes on cash and cash equivalents	3	0
Increase in cash and cash equivalents	132	156
Cash and cash equivalents at beginning of period	480	348
Cash and cash equivalents at end of period	$ 612	$ 504

Condensed Consolidated Statements of Changes in Equity (Unaudited) (USD $) In Millions, except Share data in Thousands, unless otherwise specified	Total	Noncontrolling Interests	Common Stock	Additional Paid-In Capital	Treasury Stock	Retained Earnings	Accumulated Other Comprehensive Income (Loss)	Comprehensive Income
Beginning at Dec. 31, 2008	$ 6,185	$ 283	$ 6	$ 4,558	$ (4,381)	$ 5,631	$ 88
Shares, Beginning (in thousands) at Dec. 31, 2008			630,282		(139,547)
Net income	729	50				679		729
Unrealized losses resulting from changes in fair values of derivative instruments, net of taxes of $16	(27)						(27)	(27)
Realized losses on derivative instruments reclassified into earnings, net of taxes of $17	28						28	28
Unrealized gains on marketable securities, net of taxes of $2	8	5					3	8
Foreign currency translation adjustments	86						86	86
Other comprehensive income (loss)	95							95
Comprehensive income	824							824
Cash dividends declared	(428)					(428)
Equity-based compensation transactions, including dividend equivalents, net of taxes	43			(24)	69	(2)
Equity-based compensation transactions, including dividend equivalents, net of taxes, shares					2,182
Common stock repurchases	(70)				(70)
Common stock repurchases, shares (in thousands)					(2,362)
Distributions paid to noncontrolling interests	(35)	(35)
Other	2	2
Other, shares					8
Other Comprehensive Income (Loss), Net of Tax
Foreign currency translation adjustments	86						86	86
Other comprehensive income (loss)	95							95
Comprehensive income	824							824
Ending at Sep. 30, 2009	$ 6,521	$ 305	$ 6	$ 4,534	$ (4,382)	$ 5,880	$ 178
Shares, Ending (in thousands) at Sep. 30, 2009			630,282		(139,719)

Condensed Consolidated Statements of Changes in Equity (Parenthetical) (Unaudited) (USD $) In Millions, unless otherwise specified	9 Months Ended
	Sep. 30, 2009
Tax effects on unrealized gains resulting from changes in fair values of derivative instruments	$ 16
Tax effects on realized gains on derivative instruments reclassified into earnings	17
Tax effects on unrealized losses on marketable securities	2
Accumulated Other Comprehensive Income (Loss)
Tax effects on unrealized gains resulting from changes in fair values of derivative instruments	16
Tax effects on realized gains on derivative instruments reclassified into earnings	17
Tax effects on unrealized losses on marketable securities	2
Comprehensive Income
Tax effects on unrealized gains resulting from changes in fair values of derivative instruments	16
Tax effects on realized gains on derivative instruments reclassified into earnings	17
Tax effects on unrealized losses on marketable securities	$ 2

Basis of Presentation

9 Months Ended

Sep. 30, 2009

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 Management’s 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. Our four geographic operating Groups, which include our Eastern, Midwest, Southern and Western Groups, provide collection, transfer, recycling and disposal services. Our fifth 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 December 31, 2008, can be found under “Reclassifications” below and in Note 9.

The Condensed Consolidated Financial Statements as of and for the three and nine months ended September 30, 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 Form 10-K for the year ended December 31, 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 statements.

Adoption of New Accounting Standards

Fair Value Measurements — In September 2006, the Financial Accounting Standards Board issued new authoritative guidance associated with fair value measurements. This guidance defined fair value, established a framework for measuring fair value, and expanded disclosures about fair value measurements. In February 2008, the FASB delayed the effective date of the new guidance for all non-financial assets and non-financial liabilities, except those that are measured at fair value on a recurring basis. Accordingly, we adopted this guidance for assets and liabilities recognized at fair value on a recurring basis effective January 1, 2008 and adopted the guidance for non-financial assets and liabilities measured on a non-recurring basis effective January 1, 2009. The application of the fair value framework did not have a material impact on our consolidated financial position, results of operations or cash flows.

Business Combinations — In December 2007, the FASB issued revisions to the authoritative guidance associated with business combinations. This guidance clarified and revised the principles for how an acquirer recognizes and measures identifiable assets acquired, liabilities assumed, and any noncontrolling interest in the acquiree. This guidance also addressed the recognition and measurement of goodwill acquired in business combinations and expanded disclosure requirements related to business combinations. Effective January 1, 2009, we adopted the FASB’s revised guidance associated with business combinations. The portions of this guidance that relate to business combinations completed before January 1, 2009 did not have a material impact on our consolidated financial statements. Further, business combinations completed in 2009 have not been material to our financial position, results of operations or cash flows. However, to the extent that future business combinations are material, our adoption of the FASB’s revised authoritative guidance associated with business combinations will significantly impact our accounting and reporting for future acquisitions, principally as a result of (i) expanded requirements to value acquired assets, liabilities and contingencies at their fair values when such amounts can be determined and (ii) the requirement that acquisition-related transaction and restructuring costs be expensed as incurred rather than capitalized as a part of the cost of the acquisition.

Noncontrolling Interests in Consolidated Financial Statements — In December 2007, the FASB issued new authoritative guidance that established accounting and reporting standards for noncontrolling interests in subsidiaries and for the deconsolidation of a subsidiary. The guidance also established that a noncontrolling interest in a subsidiary is an ownership interest in the consolidated entity that should be reported as equity in the consolidated financial statements. We adopted this new guidance on January 1, 2009. The presentation and disclosure requirements of this guidance, which must be applied retrospectively for all periods presented, have resulted in reclassifications to our prior period consolidated financial information and the remeasurement of our 2008 effective tax rates, which are discussed in Note 4.

Subsequent Events — In May 2009, the FASB established standards related to accounting for, and disclosure of, events that occur after the balance sheet date, but before financial statements are issued or are available to be issued. We have adopted the provisions of this new authoritative guidance, which became effective for interim and annual reporting periods ending after June 15, 2009. Subsequent events have been evaluated through the date and time the financial statements were issued on October 29, 2009. No material subsequent events have occurred since September 30, 2009 that required recognition or disclosure in our current period financial statements.

Reclassifications

Statement of Cash Flows — As a result of an increase in the significance of certain non-cash expenses, we have elected to separately identify the effects of “Interest accretion on landfill liabilities,” “Interest accretion on and discount rate adjustments to environmental remediation liabilities and recovery assets” and “Equity-based compensation expense” within the “Cash flows from operating activities” section of our Condensed Consolidated Statements of Cash Flows. We have made reclassifications in our 2008 Condensed Consolidated Statements of Cash Flows to conform prior-year information with our current period presentation.

Segments — During the first quarter of 2009, we transferred 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 four geographic Groups. We believe that, by integrating the management of these aspects of our recycling operations with the remainder of our solid waste business, we can more efficiently provide comprehensive environmental solutions to our customers and ensure that we are focusing on maximizing the profitability and return on invested capital of all aspects of our business. As a result of this operational change, 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 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 these changes for all periods presented to provide financial information that consistently reflects our current approach to managing our geographic Group operations. Refer to Note 9 for further discussion about our reportable segments.

Certain other minor reclassifications have been made to our prior period consolidated financial information in order to conform to the current year presentation.

Landfill and Environmental Remediation Liabilities

9 Months Ended

Sep. 30, 2009

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):


	September 30, 2009						December 31, 2008
			Environmental						Environmental
	Landfill		Remediation		Total		Landfill		Remediation		Total

Current (in accrued liabilities)	$	113	$	55	$	168	$	108	$	49	$	157
Long-term		1,155		206		1,361		1,110		250		1,360

	$	1,268	$	261	$	1,529	$	1,218	$	299	$	1,517

The changes to landfill and environmental remediation liabilities for the year ended December 31, 2008 and the nine months ended September 30, 2009 are reflected in the table below (in millions):


				Environmental
	Landfill			Remediation

December 31, 2007	$	1,178		$	284
Obligations incurred and capitalized		51			—
Obligations settled		(72	)		(38	)
Interest accretion		77			8
Revisions in cost estimates and interest rate assumptions		(13	)		49
Acquisitions, divestitures and other adjustments		(3	)		(4	)

December 31, 2008		1,218			299
Obligations incurred and capitalized		29			—
Obligations settled		(51	)		(33	)
Interest accretion		59			5
Revisions in cost estimates and interest rate assumptions(a)		9			(12	)
Acquisitions, divestitures and other adjustments		4			2

September 30, 2009	$	1,268		$	261


(a)		During the nine months ended September 30, 2009, we recognized a $23 million decrease to our environmental remediation liabilities and a corresponding reduction to “Operating” expenses for the impact of changes in the risk-free discount rate used to measure the liabilities. As of December 31, 2008, we used a risk-free discount rate of 2.25% for these obligations. The applicable rate was increased to 2.75% effective March 31, 2009 and 3.50% effective June 30, 2009. There was not a change in the applicable discount rate during the three months ended September 30, 2009. The decrease in these liabilities due to changes in discount rate have been partially offset by the recognition of additional liabilities at both active and closed landfills resulting generally from an increase in the expected costs required to remediate the sites.

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 $230 million at September 30, 2009, and is primarily included as long-term “Other assets” in our Condensed Consolidated Balance Sheet.

Debt

9 Months Ended

Sep. 30, 2009

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 September 30, 2009:


	September 30,		December 31,
	2009		2008

Revolving credit facility (weighted average interest rate of 2.4% at December 31, 2008)	$	—	$	300
Letter of credit facilities		—		—
Canadian credit facility (weighted average interest rate of 2.0% at September 30, 2009 and 3.3% at December 31, 2008)		269		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 September 30, 2009 and 6.8% at December 31, 2008)		4,884		4,628
Tax-exempt bonds maturing through 2039, fixed and variable interest rates ranging from 0.2% to 7.4% (weighted average interest rate of 3.6% at September 30, 2009 and 3.9% at December 31, 2008)		2,649		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 4.4% at September 30, 2009 and 4.9% at December 31, 2008)		194		220
Capital leases and other, maturing through 2050, interest rates up to 12%		250		252

Total long-term debt		8,246		8,326
Current portion of long-term debt		742		835

Long-term debt, less current portion	$	7,504	$	7,491

As of September 30, 2009, we had (i) $1,014 million of debt maturing within twelve months, consisting primarily of $269 million under our Canadian credit facility and $600 million of 7.375% senior notes that mature in August 2010; and (ii) $723 million of fixed-rate tax-exempt borrowings subject to re-pricing within the next twelve months. Under accounting principles generally accepted in the United States, this $1,737 million of debt must be classified as current unless we have the intent and ability to refinance it on a long-term basis. As discussed below, as of September 30, 2009, we had the intent and ability to refinance $995 million of this debt on a long-term basis. We have classified the remaining $742 million as current obligations as of September 30, 2009.

All of the borrowings outstanding under the Canadian credit facility mature less than one year from the date of issuance, but may be renewed under the terms of the facility, which matures in November 2012. As of September 30, 2009, we intend to repay $18 million of the outstanding borrowings under the facility with available cash during the next twelve months and refinance the remaining balance under the terms of the facility. As a result, as of September 30, 2009, $251 million of advances under the facility were classified as long-term based on our intent and ability to refinance the obligations on a long-term basis under the terms of the facility.

Additionally, we have classified the $723 million of tax-exempt bonds subject to re-pricing within twelve months as long-term as of September 30, 2009 based on our intent and ability to refinance any failed re-pricings using our $2.4 billion revolving credit facility. Although we also intend to refinance the $600 million of senior notes maturing in August 2010 on a long-term basis, an aggregate of $1,632 million of capacity under our revolving credit facility is currently utilized to support outstanding letters of credit and we currently expect our utilization of the facility for this purpose to increase by $24 million during the next twelve months. After giving effect to these items, only $21 million of capacity is forecasted to be available under the revolving credit facility, giving us the ability to classify only $21 million of the August 2010 maturity as long-term as of September 30, 2009.

The significant changes in our debt balances from December 31, 2008 to September 30, 2009 are related to the following:


	•	Revolving credit facility — We repaid the $300 million of outstanding borrowings with proceeds from the issuance of senior notes, discussed below.

	•	Canadian credit facility — The increase in the carrying value is due to (i) accounting for changes in the Canadian currency translation rate, which increased the carrying value by $33 million during the nine months ended September 30, 2009, and (ii) the impact of interest accretion, which increased the carrying value by $5 million during the nine months ended September 30, 2009. These increases were partially offset by $11 million of debt repayments.

	•	Senior notes — In February 2009, we issued $350 million of 6.375% senior notes due March 11, 2015 and $450 million of 7.375% senior notes due March 11, 2019. The net proceeds from the debt issuance were $793 million. A portion of the proceeds was used to repay $300 million of outstanding borrowings under the revolving credit facility and the remaining proceeds were used to repay $500 million of 6.875% senior notes that matured in May 2009.

The remaining change in the carrying value of our senior notes from December 31, 2008 to September 30, 2009 is due to accounting for our fixed-to-floating interest rate swap agreements, which are accounted for as fair value hedges resulting in all fair value adjustments being reflected as a component of the carrying value of the underlying debt. For additional information regarding our interest rate derivatives, refer to Note 11.


	•	Tax-exempt bonds — We issued $30 million of tax-exempt bonds during the nine months ended September 30, 2009. The proceeds from the issuance of the bonds were deposited directly into a trust fund and may only be used for the specific purpose for which the money was raised. Accordingly, the restricted funds provided by these financing activities have not been included in “New Borrowings” in our Condensed Consolidated Statement of Cash Flows. During the nine months ended September 30, 2009, $65 million of our tax-exempt bonds were repaid with available cash.

	•	Tax-exempt project bonds — Tax-exempt project bonds have been used by our Wheelabrator Group to finance the development of waste-to-energy facilities. These facilities are integral to the local communities they serve, and, as such, are supported by long-term contracts with multiple municipalities. The bonds generally have periodic amortizations that are supported by the cash flow of each specific facility being financed. During the nine months ended September 30, 2009, we repaid $26 million of our tax-exempt project bonds with debt service funds and available cash.

Income Taxes

9 Months Ended

Sep. 30, 2009

Income Taxes [Abstract]

Income Taxes


4.	Income Taxes

Our effective tax rate for the three and nine months ended September 30, 2009 was 31.2% and 35.2%, respectively, compared with 38.4% and 37.6%, respectively, for the comparable prior-year periods. As a result of our adoption on January 1, 2009 of accounting guidance associated with noncontrolling interests in consolidated financial statements, 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 rates have 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 most significant items affecting the reconciliation of income taxes computed at the federal statutory rate and reported income taxes for the three- and nine-month periods ended September 30, 2009 were (i) the finalization of our 2008 tax returns, which reduced our provision for income taxes by $11 million; (ii) tax audit settlements, which reduced our provision for income taxes by $9 million; (iii) a $5 million benefit related to the utilization of state net operating loss carryforwards; (iv) the impacts of state and local income taxes; and (v) a $6 million increase in our provision for income taxes related to an increase in our net accumulated state deferred tax liabilities.

The difference between income taxes computed at the federal statutory rate and reported income taxes for the three- and nine-month periods ended September 30, 2008 was primarily due to state and local income taxes. For the nine months ended September 30, 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 $13 million, and a $3 million tax benefit recognized for the final true-up of our 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

9 Months Ended

Sep. 30, 2009

Comprehensive Income [Abstract]

Comprehensive Income


5.	Comprehensive Income

Comprehensive income was as follows (in millions):


	Three Months						Nine Months
	Ended						Ended
	September 30,						September 30,
	2009			2008			2009			2008

Consolidated net income	$	292		$	323		$	729		$	902

Other comprehensive income (loss), net of taxes:
Unrealized gains (losses) resulting from changes in fair value of derivative instruments, net of taxes		(20	)		15			(27	)		12
Realized (gains) losses on derivative instruments reclassified into earnings, net of taxes		19			(9	)		28			(10	)
Unrealized gains (losses) on marketable securities, net of taxes		5			(5	)		8			(10	)
Foreign currency translation adjustments		58			(28	)		86			(45	)

Other comprehensive income (loss)		62			(27	)		95			(53	)

Comprehensive income		354			296			824			849
Comprehensive income attributable to noncontrolling interests		(18	)		(10	)		(55	)		(27	)

Comprehensive income attributable to Waste Management, Inc.	$	336		$	286		$	769		$	822

The components of accumulated other comprehensive income, which is included as a component of Waste Management, Inc. stockholders’ equity, were as follows (in millions):


	September 30,			December 31,
	2009			2008

Accumulated unrealized loss on derivative instruments, net of taxes	$	(18	)	$	(19	)
Accumulated unrealized gain (loss) on marketable securities, net of taxes		1			(2	)
Cumulative foreign currency translation adjustments		199			113
Underfunded post-retirement benefit obligations, net of taxes		(4	)		(4	)

	$	178		$	88

- Definition

This label may include the following: 1) the amount of income tax expense or benefit allocated to each component of other comprehensive income, including reclassification adjustments, 2) the reclassification adjustments for each classification of other comprehensive income and 3) the ending accumulated balances for each component of comprehensive income. Components of comprehensive income include: (1) foreign currency translation adjustments; (2) gains and losses on foreign currency transactions that are designated as, and are effective as, economic hedges of a net investment in a foreign entity; (3) gains and losses on intercompany foreign currency transactions that are of a long-term-investment nature, when the entities to the transaction are consolidated, combined, or accounted for by the equity method in the reporting enterprise's financial statements; (4) change in the market value of a futures contract that qualifies as a hedge of an asset reported at fair value; (5) unrealized holding gains and losses on available-for-sale securities and that resulting from transfers of debt securities from the held-to-maturity category to the available-for-sale category; (6) a net loss recognized as an additional pension liability not yet recognized as net periodic pension cost; and (7) the net gain or loss and net prior service cost or credit for pension plans and other postretirement benefit plans.

+ References+ Details

Earnings Per Share

9 Months Ended

Sep. 30, 2009

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				Nine Months
	Ended				Ended
	September 30,				September 30,
	2009		2008		2009		2008

Number of common shares outstanding at end of period		490.6		490.6		490.6		490.6
Effect of using weighted average common shares outstanding		1.6		0.2		1.5		1.9

Weighted average basic common shares outstanding		492.2		490.8		492.1		492.5
Dilutive effect of equity-based compensation awards and other contingently issuable shares		2.4		3.3		2.0		3.3

Weighted average diluted common shares outstanding		494.6		494.1		494.1		495.8

Potentially issuable shares		13.7		15.4		13.7		15.4
Number of anti-dilutive potentially issuable shares excluded from diluted common shares outstanding		3.1		0.9		3.3		0.9

Commitments and Contingencies

9 Months Ended

Sep. 30, 2009

Commitments and Contingencies [Abstract]

Commitments and Contingencies


7.	Commitments and Contingencies

Purchase commitments — We continue to focus on the expansion of our waste-to-energy business and are actively pursuing various projects in the United States and internationally. In August 2009, we entered into an agreement to purchase a 40 percent equity investment in Shanghai Environment Group (“SEG”), a subsidiary of Shanghai Chengtou Holding, for approximately $140 million. As a joint venture partner in SEG, we will participate in the operation and management of waste-to-energy and other waste services in the Chinese market. SEG will also focus on building new waste-to-energy facilities in China. Our purchase of an interest in SEG is subject to regulatory approval, but the transaction is currently expected to be approved in early 2010.

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 noncontrolling 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 WM Holdings enter into guarantee agreements associated with their subsidiaries’ operations. Additionally, WMI and WM Holdings 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 September 30, 2009 include (i) guarantees of unconsolidated entities’ financial obligations maturing through 2020 for maximum future payments of $10 million; and (ii) agreements guaranteeing the market value of homeowners’ properties adjacent to or near certain of our landfills. Our indemnification obligations generally arise in divestitures and provide that we will be responsible for liabilities associated with our operations for events that occurred prior to the sale of the operations. Additionally, under certain of our acquisition agreements, we have provided for additional consideration to be paid to the sellers if established financial targets are achieved post-closing. For acquisitions completed in 2009, we have recognized liabilities for these contingent obligations based on an estimate of the fair value of these contingencies at the time of acquisition. For acquisitions completed before 2009, the costs associated with any additional consideration requirements are accounted for as incurred. Contingent obligations related to indemnifications arising from our divestitures and contingent consideration provided for by our acquisitions are not expected to be material to our financial position, results of operations or cash flows.

Environmental matters — A significant portion of our operating costs and capital expenditures could be characterized as costs of environmental protection, as we are subject to an array of laws and regulations relating to the protection of the environment. Under current laws and regulations, we may have liabilities for environmental damage caused by our operations, or for damage caused by conditions that existed before we acquired a site. In addition to remediation activity required by state or local authorities, such liabilities include potentially responsible party, or PRP, investigations. The costs associated with these liabilities can include settlements, certain legal and consultant fees, as well as incremental internal and external costs directly associated with site investigation and clean-up.

Estimating our degree of responsibility for remediation of a particular site is inherently difficult and determining the method and ultimate cost of remediation requires that a number of assumptions be made. There can sometimes be a range of reasonable estimates of the costs associated with the likely remedy of a site. In these cases, we use the amount within the range that constitutes our best estimate. If no amount within a range appears to be a better estimate than any other, we use the amount that is the low end of such range. If we used the high ends of such ranges, our aggregate potential liability would be approximately $145 million higher than the $261 million recorded in the Condensed Consolidated Financial Statements as of September 30, 2009. Our ongoing review of our remediation liabilities could result in revisions to our accruals that could cause upward or downward adjustments to income from operations. These adjustments could be material in any given period.

As of September 30, 2009, we had been notified that we are a PRP in connection with 74 locations listed on the EPA’s National Priorities List, or NPL. Of the 74 sites at which claims have been made against us, 16 are sites we own. Each of the NPL sites we own was initially developed by others as a landfill disposal facility. At each of these facilities, we are working in conjunction with the government to characterize or remediate identified site problems, and we have either agreed with other legally liable parties on an arrangement for sharing the costs of remediation or are working toward a cost-sharing agreement. We generally expect to receive any amounts due from other participating parties at or near the time that we make the remedial expenditures. The other 58 NPL sites, which we do not own, are at various procedural stages under the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended, known as CERCLA or Superfund.

Litigation — In April 2002, two former participants in the ERISA plans of Waste Management Holdings, Inc., a wholly-owned subsidiary we acquired in 1998 (“WM Holdings”), filed a lawsuit in the U.S. District Court for the District of Columbia in a case entitled William S. Harris, et al. v. James E. Koenig, et al. The lawsuit named as defendants WM Holdings and various members of WM Holdings’ Board of Directors prior to July 1998, and the Administrative Committee of WM Holdings’ ERISA plans and its individual members; various members of the Administrative and Investment Committees of WMI’s ERISA plans; and State Street Bank & Trust, the trustee and investment manager of WMI’s ERISA plans. The lawsuit attempts to increase the recovery of a class of ERISA plan participants based on allegations related to both the events alleged in, and the settlements relating to, the securities class action against WM Holdings that was settled in 1998 and the securities class action against WMI that was settled in 2001. The defendants filed motions to dismiss the complaints on the pleadings, and in April 2009, the Court granted in part and denied in part the defendants’ motions. The Court dismissed the plaintiffs’ claims that were based on alleged accounting irregularities by WM Holdings for the period between January 1990 and February 1998. However, the Court denied defendants’ motion to dismiss plaintiffs’ claims alleging breaches of fiduciary duties against all of the defendants during the time period between July 1999 and December 1999 based primarily on defendants allowing the WM Holdings ERISA plan to participate in the settlement of the securities class action against WM Holdings. Each of Mr. Pope, Mr. Rothmeier and Ms. San Juan Cafferty, members of our Board of Directors, was a member of the WM Holdings’ Board of Directors and therefore is a named defendant in these actions, as is Mr. Simpson, our Chief Financial Officer, by virtue of his membership on the WMI ERISA plan Investment Committee at that time. The Court also denied the defendants’ motion for dismissal for the claims related to the period between February 2002 and July 2002 against State Street for failing to adequately represent the plaintiffs’ interests in the settlement of the securities class action against WMI. All of the defendants intend to defend themselves vigorously.

There are two separate wage and hour lawsuits pending against certain of our subsidiaries in California, each seeking class certification. The actions have recently been coordinated to proceed in San Diego County. Both lawsuits make the same general allegations that the defendants failed to comply with certain California wage and hour laws, including allegedly failing to provide meal and rest periods, and failing to properly pay hourly and overtime wages. Similarly, a purported class action lawsuit was filed against WMI in August 2008 in federal court in Minnesota alleging that we violated the Fair Labor Standards Act. The court in the Minnesota lawsuit denied the plaintiffs’ motion for conditional class certification, and the plaintiffs have asked for reconsideration. The plaintiffs also have indicated that without class certification, they intend to pursue their claims through individual lawsuits. We deny the claims in all of the actions and intend to continue to vigorously defend all of these matters. Given the inherent uncertainties of litigation, the ultimate outcomes cannot be predicted at this time, nor can possible damages, if any, be reasonably estimated.

From time to time, we also are named as defendants in personal injury and property damage lawsuits, including purported class actions, on the basis of having owned, operated or transported waste to a disposal facility that is alleged to have contaminated the environment or, in certain cases, on the basis of having conducted environmental remediation activities at sites. Some of the lawsuits may seek to have us pay the costs of monitoring of allegedly affected sites and health care examinations of allegedly affected persons for a substantial period of time even where no actual damage is proven. While we believe we have meritorious defenses to these lawsuits, the ultimate resolution is often substantially uncertain due to the difficulty of determining the cause, extent and impact of alleged contamination (which may have occurred over a long period of time), the potential for successive groups of complainants to emerge, the diversity of the individual plaintiffs’ circumstances, and the potential contribution or indemnification obligations of co-defendants or other third parties, among other factors.

As a large company with operations across the United States and Canada, we are subject to various proceedings, lawsuits, disputes and claims arising in the ordinary course of our business. Many of these actions raise complex factual and legal issues and are subject to uncertainties. Actions filed against us include commercial, customer, and employment-related claims, including purported class action lawsuits related to our customer service agreements and purported class actions involving federal and state wage and hour and other laws. The plaintiffs in some actions seek unspecified damages or injunctive relief, or both. These actions are in various procedural stages, and some are covered in part by insurance. We currently do not believe that any such actions will ultimately have a material adverse impact on our consolidated financial statements.

WMI’s charter and bylaws currently require indemnification of its officers and directors if statutory standards of conduct have been met and allow the advancement of expenses to these individuals upon receipt of an undertaking by the individuals to repay all expenses if it is ultimately determined that they did not meet the required standards of conduct. Additionally, WMI has entered into separate indemnification agreements with each of the members of its Board of Directors as well as its Chief Executive Officer, its President and its Chief Financial Officer. The Company may incur substantial expenses in connection with the fulfillment of its advancement of costs and indemnification obligations in connection with current actions involving former officers of the Company or its subsidiaries, including the Harris lawsuit mentioned above, or other actions or proceedings that may be brought against its former or current officers, directors and employees.

On March 20, 2008, we filed a lawsuit in state district court in Harris County, Texas against SAP AG and SAP America, Inc., alleging fraud and breach of contract. The lawsuit relates to our 2005 software license from SAP for a waste and recycling revenue management system and agreement for SAP to implement the software on a fixed-fee basis. We have alleged (i) that SAP demonstrated and sold software that SAP represented was a mature, “out-of-the-box” software solution that met the specific business requirements of the Company, (ii) that SAP represented no production, modification or customization would be necessary and (iii) that SAP represented the software would be fully implemented throughout the Company in 18 months. We are vigorously pursuing all claims available, including recovery of all payments we have made, costs we have incurred and the benefits we have not realized. SAP filed a general denial to the suit. Discovery is ongoing and trial is currently scheduled for May 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 and immaturity of the SAP software, we determined to abandon any alternative that includes the use of the SAP software. Our determination to abandon the SAP software resulted in a non-cash impairment charge of $49 million. Refer to Note 10 for additional information related to the impairment charge.

Item 103 of the SEC’s Regulation S-K requires disclosure of certain environmental matters when a governmental authority is a party to the proceedings and the proceedings involve potential monetary sanctions that we reasonably believe could exceed $100,000. The following matter, pending as of September 30, 2009, is disclosed in accordance with that requirement:

On April 4, 2006, the EPA issued a Finding and Notice of Violation (“FNOV”) to Waste Management of Hawaii, Inc., an indirect wholly-owned subsidiary of WMI, and to the City and County of Honolulu for alleged violations of the federal Clean Air Act, based on alleged failure to submit certain reports and design plans required by the EPA, and the failure to begin and timely complete the installation of a gas collection and control system for the Waimanalo Gulch Sanitary Landfill on Oahu. The FNOV did not propose a penalty amount and the parties have been in confidential settlement negotiations. Pursuant to an indemnity agreement, any penalty assessed will be paid by the Company, and not by the City and County of Honolulu.

Tax matters — In the third quarter of 2009 we effectively settled our 2008 federal tax audit and various state tax audits resulting in a tax benefit of $9 million. We participate in the IRS’s Compliance Assurance Program, whereby we work with the IRS throughout the year in order to resolve any material issues prior to the filing of our year-end tax return. We are currently in the examination phase of an IRS audit for the 2009 tax year. We expect this audit to be completed within the next 15 months. Audits associated with state and local jurisdictions date back to 1999 and examinations associated with Canada date back to 1998. To provide for certain potential tax exposures, we maintain a liability for unrecognized tax benefits, the balance of which management believes is adequate. Results of audit assessments by taxing authorities could have a material effect on our quarterly or annual cash flows as audits are completed, although we do not believe that current tax audit matters will have a material adverse impact on our results of operations.

We have approximately $2.8 billion of tax-exempt bonds outstanding as of September 30, 2009. Tax-exempt financings are structured pursuant to certain terms and conditions of the Internal Revenue Code, which exempt from taxation the interest income earned by the bondholders. The requirements of the Code are complex, and failure to comply with these requirements could cause certain interest payments previously made on the bonds to be taxable and could cause either outstanding principal amounts on the bonds to be accelerated or future interest payments on the bonds to be taxable. Some of the Company’s tax-exempt financings have been, or currently are, the subject of examinations by the IRS to determine whether the financings meet the requirements of the Code and applicable regulations. We do not believe that current examinations will have a material adverse impact on our financial position, results of operations or cash flows.

Restructuring

9 Months Ended

Sep. 30, 2009

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 Note 9. Each of our four 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 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 this reorganization has allowed us to lower costs and to 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 four geographic Groups. By integrating the management of these recycling services with the remainder of our solid waste business, we are 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 1,500 employee positions throughout the Company. During the three and nine months ended September 30, 2009, we recognized $3 million and $46 million, respectively, of pre-tax restructuring charges associated with this reorganization, of which $2 million and $40 million, 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 and Other organizations (in millions):


	Three Months Ended		Nine Months Ended
	September 30, 2009		September 30, 2009

Eastern	$	—	$	10
Midwest		1		10
Southern		1		10
Western		—		6
Wheelabrator		—		—
Corporate and Other		1		10

Total	$	3	$	46

Through September 30, 2009, we had paid approximately $32 million 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 fourth quarter of 2010.

We currently expect to incur additional restructuring charges of between $5 million and $10 million associated with this reorganization during the remainder of 2009.

Segment and Related Information

9 Months Ended

Sep. 30, 2009

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 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 these changes 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 nine months ended September 30 is shown in the following tables (in millions):


	Gross		Intercompany			Net
	Operating		Operating			Operating		Income from
	Revenues		Revenues			Revenues		Operations

Three Months Ended:

September 30, 2009
Eastern	$	763	$	(139	)	$	624	$	138
Midwest		749		(112	)		637		126
Southern		836		(108	)		728		193
Western		801		(106	)		695		141
Wheelabrator		214		(32	)		182		74
Other		163		(6	)		157		(32	)

		3,526		(503	)		3,023		640
Corporate and Other		—		—			—		(115	)

Total	$	3,526	$	(503	)	$	3,023	$	525

September 30, 2008
Eastern	$	869	$	(156	)	$	713	$	144
Midwest		876		(127	)		749		125
Southern		957		(124	)		833		231
Western		886		(112	)		774		156
Wheelabrator		245		(24	)		221		104
Other		248		(13	)		235		(12	)

		4,081		(556	)		3,525		748
Corporate and Other		—		—			—		(116	)

Total	$	4,081	$	(556	)	$	3,525	$	632


Nine Months Ended:

September 30, 2009
Eastern	$	2,211	$	(404	)	$	1,807	$	349
Midwest		2,121		(319	)		1,802		327
Southern		2,509		(326	)		2,183		581
Western		2,343		(310	)		2,033		415
Wheelabrator		627		(90	)		537		167
Other		441		(18	)		423		(91	)

		10,252		(1,467	)		8,785		1,748
Corporate and Other		—		—			—		(317	)

Total	$	10,252	$	(1,467	)	$	8,785	$	1,431

September 30, 2008
Eastern	$	2,550	$	(457	)	$	2,093	$	417
Midwest		2,531		(368	)		2,163		371
Southern		2,846		(379	)		2,467		665
Western		2,592		(328	)		2,264		476
Wheelabrator		683		(65	)		618		239
Other		712		(37	)		675		(39	)

		11,914		(1,634	)		10,280		2,129
Corporate and Other		—		—			—		(354	)

Total	$	11,914	$	(1,634	)	$	10,280	$	1,775

Fluctuations in our operating results may be caused by many factors, including period-to-period changes in the relative contribution of revenue by each line of business and operating segment and by general economic conditions. In addition, our revenues and income from operations typically reflect seasonal patterns. Our operating revenues tend to be somewhat higher in the summer months, primarily due to the higher volume of construction and demolition waste. The volumes of industrial and residential waste in certain regions where we operate also tend to increase during the summer months. Our second and third quarter revenues and results of operations typically reflect these seasonal trends, although we saw a significantly weaker seasonal volume increase during 2009 than we generally experience.

Although there have not been significant impacts of weather-related services for the reported periods, certain destructive weather conditions that tend to occur during the second half of the year actually increase our revenues in the areas affected. For several reasons, including significant start-up costs, such revenue often generates comparatively lower margins. Certain weather conditions may result in the temporary suspension of our operations, which can significantly affect the operating results of the affected regions. The operating results of our first quarter also often reflect higher repair and maintenance expenses because we rely on the slower winter months, when waste flows are generally lower, to perform scheduled maintenance at our waste-to-energy facilities.

During the periods presented, the comparability of the revenue and operating results of our geographic Groups has been significantly affected by (i) the economic downturn, which resulted in a decrease in our revenues when comparing the three and nine months ended September 30, 2009 with the comparable prior-year periods due to reduced consumer and business spending; (ii) sharply lower recycling commodities prices and diesel fuel prices when comparing the three and nine months ended September 30, 2009 with the comparable prior-year periods, which resulted in a decline in both revenues and operating expenses; and (iii) our continued focus on pricing, which has increased revenues and the operating margins of our collection line of business.

The revenues and operating results of our Wheelabrator Group have been unfavorably affected by a significant decrease in the rates charged for electricity under our power purchase contracts, which are tied to natural gas prices. Exposure to market fluctuations in natural gas prices has increased for the Wheelabrator Group in 2009 due in large part to the expiration of several long-term energy contracts. Additionally, the Company’s current focus on the expansion of our waste-to-energy business both internationally and domestically has increased Wheelabrator’s costs and expenses, which has negatively affected the comparability of their operating results for the periods presented.

From time to time, the operating results of our reportable segments are significantly affected by unusual or infrequent transactions or events. As disclosed in Note 8, the income from operations of each of our geographic Groups for the three and nine months ended September 30, 2009 has been affected by our January 2009 reorganization. In addition, the Midwest Group’s operating results for the three and nine months ended September 30, 2008 were negatively affected by $26 million of increased “Operating” expenses due to a labor disruption associated with the renegotiation of a collective bargaining agreement in Milwaukee, Wisconsin and the related agreement of the bargaining unit to withdraw from the Central States Pension Fund.

(Income) Expense from Divestitures, Asset Impairments and Unusual Items

9 Months Ended

Sep. 30, 2009

(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

Three and Nine Months Ended September 30, 2009

As of December 31, 2008, our “Property and equipment” included $70 million of accumulated costs associated with the development of our waste and recycling revenue management system. Approximately $49 million of these costs were specifically associated with the purchase of the license of SAP’s waste and recycling revenue management software and the efforts required to develop and configure that software for our use. The remaining costs were primarily 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 Note 7, in March 2008, we filed suit against SAP and are currently scheduled for trial in May 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 $49 million.

Three and Nine Months Ended September 30, 2008

We recognized $28 million of net gains from divestitures during the nine months ended September 30, 2008 related to the divestiture of under-performing collection operations in our Southern Group, $2 million of which was recognized during the first quarter of 2008 and $26 million of which was recognized during the third quarter of 2008. The impact of the gains from divestitures was offset, in part, by the recognition of a $3 million impairment charge during the third quarter of 2008 as a result of a decision to close a landfill in our Southern Group.

Fair Value Measurements

9 Months Ended

Sep. 30, 2009

Fair Value Measurements [Abstract]

Fair Value Measurements


11.	Fair Value Measurements

Assets and Liabilities Accounted for at Fair Value

Authoritative guidance associated with fair value measurements 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 (Level 1 inputs) and the lowest priority to unobservable inputs (Level 3 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 September 30, 2009, our assets and liabilities 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)	$	525	$	525	$	—	$	—
Available-for-sale securities(b)		307		307		—		—
Interest rate derivatives(c),(d)		63		—		63		—

Total assets	$	895	$	832	$	63	$	—

Liabilities:
Interest rate derivatives(d),(e)		3		—		3		—
Foreign currency derivatives(f)		12		—		12		—

Total liabilities	$	15	$	—	$	15	$	—


(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 portion of our debt obligations at variable, market-driven interest rates. As of September 30, 2009, we had approximately $4.8 billion in fixed-rate senior notes outstanding. The interest payments on $1.5 billion 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 these interest rate derivatives on our balance sheet as of September 30, 2009 (in millions):

Gains or losses on the derivatives as well as the offsetting losses or gains on the hedged items attributable to interest rate swaps are recognized in current earnings. We include gains and losses on derivative instruments in the same financial statement line item as offsetting gains and losses on the related hedged items. The following table summarizes the impact of changes in the fair value of our interest rate swaps and the underlying hedged items on our results of operations for the three and nine months ended September 30, 2009 (in millions):


	Three Months Ended					Nine Months Ended
	September 30, 2009					September 30, 2009
Statement of Operations	Gain (Loss) on		Gain (Loss) on			Gain (Loss) on			Gain (Loss) on
Classification	Swap		Fixed-Rate Debt			Swap			Fixed-Rate Debt

Interest expense	$	11	$	(11	)	$	(29	)	$	29


(d)		Certain of our interest rate derivative instruments contain provisions related to the Company’s credit ratings. If the Company’s credit rating were to fall below investment grade, the counterparties have the ability to cancel the derivative agreements and request immediate payment of derivative instruments that are in net liability positions. We do not have any derivative instruments with credit-risk-related contingent features that are in a net liability position at September 30, 2009.

(e)		During the third quarter of 2009, we entered into Treasury rate locks with a total notional value of $200 million to hedge the risk of changes in semi-annual interest payments associated with senior notes that the Company plans to issue in June 2010. We have designated our Treasury rate lock derivatives as cash flow hedges. As of September 30, 2009, the fair value of these interest rate derivatives is comprised of $3 million of current liabilities. We recognized pre-tax and after-tax losses of $3 million and $2 million, respectively, to other comprehensive income for changes in the fair value of our Treasury rate cash flow hedges during the three and nine months ended September 30, 2009.

(f)		We use foreign currency exchange rate derivatives to hedge our exposure to changes in exchange rates for anticipated intercompany cash transactions between WM Holdings and its Canadian subsidiaries. As of September 30, 2009, we have foreign currency forward contracts outstanding for all of our anticipated cash flows associated with an outstanding debt arrangement with these wholly-owned subsidiaries. The hedged cash flows include Canadian $370 million of principal payments, which are scheduled for December 31, 2010, and Canadian $44 million of total interest payments scheduled for December 31, 2009 and December 31, 2010. We have designated our foreign currency derivatives as cash flow hedges. The following table summarizes the impact of our foreign currency derivatives on our balance sheet as of September 30, 2009 (in millions):

Gains or losses on the derivatives as well as the offsetting losses or gains on the hedged items attributable to foreign currency exchange risk are recognized in current earnings. We include gains and losses on derivative instruments in the same financial statement line item as offsetting gains and losses on the related hedged items. The following table summarizes the pre-tax impacts of our foreign currency cash flow derivatives on our results of operations and comprehensive income for the three and nine months ended September 30, 2009 (in millions):

Three Months Ended September 30, 2009

Nine Months Ended September 30, 2009

Amount of Gain or

Derivatives in

(Loss) Recognized

(Loss) Reclassified

(Loss) Recognized

(Loss) Reclassified

SFAS No. 133 Cash

in OCI on

Statement of

from AOCI into

in OCI on

Statement of

from AOCI into

Flow Hedging

Derivatives

Operations

Income

Derivatives

Operations

Income

Relationships

(Effective Portion)

Classification

(Effective Portion)

Classification

(Effective Portion)

Foreign exchange contracts

(28

)

Other income (expense)

(28

)

(40

)

Other income (expense)

(40

)

The above table represents the impacts of our foreign exchange contracts on a pre-tax basis. Amounts reported in other comprehensive income and accumulated other comprehensive income are reported net of tax. We recognized an after-tax loss to other comprehensive income for changes in the fair value of our foreign currency cash flow hedges of $18 million during the three months ended September 30, 2009 and $25 million during the nine months ended September 30, 2009. After-tax losses reclassified from accumulated other comprehensive income into income were $17 million and $25 million during the three and nine months ended September 30, 2009, respectively. There was no significant ineffectiveness associated with these hedges during the three and nine months ended September 30, 2009.

Fair Value of Debt

At September 30, 2009, the carrying value of our debt was approximately $8.2 billion compared with $8.3 billion at December 31, 2008. The carrying value of our debt includes adjustments for both the unamortized fair value adjustments related to terminated hedge arrangements and fair value adjustments of debt instruments that are currently hedged.

The estimated fair value of our debt was approximately $8.6 billion at September 30, 2009 and approximately $7.7 billion at December 31, 2008. The estimated fair value of our senior notes is based on quoted market prices. The carrying value of remarketable debt approximates fair value due to the short-term nature of the attached interest rates. The fair value of our other debt is estimated using discounted cash flow analysis, based on rates we would currently pay for similar types of instruments. The increase in the fair value of our debt when comparing September 30, 2009 with December 31, 2008 is primarily related to (i) an increase in market prices for corporate debt securities due to a significant improvement in the condition of the credit markets as compared with late 2008, which caused a substantial increase in the fair value of our publicly-traded senior notes; and (ii) a significant decrease in current market rates on fixed-rate tax-exempt bonds.

Although we have determined the estimated fair value amounts using available market information and commonly accepted valuation methodologies, considerable judgment is required in interpreting market data to develop the estimates of fair value. Accordingly, our estimates are not necessarily indicative of the amounts that we, or holders of the instruments, could realize in a current market exchange. The use of different assumptions and/or estimation methodologies could have a material effect on the estimated fair values. The fair value estimates are based on information available as of September 30, 2009 and December 31, 2008. These amounts have not been revalued since those dates, and current estimates of fair value could differ significantly from the amounts presented.

- Definition

This item represents the complete disclosure regarding the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments, assets, and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the Company is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information. This element can be used to disclose the entity's entire derivative instruments and hedging activities disclosure as a single block of text. Describes an entity's risk management strategies, derivatives in hedging activities and non-hedging derivative instruments, the assets, obligations, liabilities, revenues and expenses arising there from, and the amounts of and methodologies and assumptions used in determining the amounts of such items.

+ References+ Details

Condensed Consolidating Financial Statements

9 Months Ended

Sep. 30, 2009

Condensed Consolidating Financial Statements [Abstract]

Condensed Consolidating Financial Statements


12.	Condensed Consolidating Financial Statements

WM Holdings has fully and unconditionally guaranteed all of WMI’s senior indebtedness. WMI has fully and unconditionally guaranteed all of WM Holdings’ senior indebtedness. None of WMI’s other subsidiaries have guaranteed any of WMI’s or WM Holdings’ 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

September 30, 2009
(Unaudited)


			WM		Non-Guarantor
	WMI		Holdings		Subsidiaries		Eliminations			Consolidated

ASSETS
Current assets:
Cash and cash equivalents	$	509	$	—	$	103	$	—		$	612
Other current assets		21		—		1,877		—			1,898

		530		—		1,980		—			2,510
Property and equipment, net		—		—		11,356		—			11,356
Investments in and advances to affiliates		10,069		12,404		2,035		(24,508	)		—
Other assets		75		17		6,434		—			6,526

Total assets	$	10,674	$	12,421	$	21,805	$	(24,508	)	$	20,392


LIABILITIES AND EQUITY
Current liabilities:
Current portion of long-term debt	$	615	$	35	$	92	$	—		$	742
Accounts payable and other current liabilities		63		6		1,994		—			2,063

		678		41		2,086		—			2,805
Long-term debt, less current portion		3,780		602		3,122		—			7,504
Other liabilities		—		—		3,562		—			3,562

Total liabilities		4,458		643		8,770		—			13,871
Equity:
Stockholders’ equity		6,216		11,778		12,730		(24,508	)		6,216
Noncontrolling interests		—		—		305		—			305

		6,216		11,778		13,035		(24,508	)		6,521

Total liabilities and equity	$	10,674	$	12,421	$	21,805	$	(24,508	)	$	20,392

December 31, 2008


			WM		Non-Guarantor
	WMI		Holdings		Subsidiaries		Eliminations			Consolidated

ASSETS
Current assets:
Cash and cash equivalents	$	450	$	—	$	30	$	—		$	480
Other current assets		6		—		1,849		—			1,855

		456		—		1,879		—			2,335
Property and equipment, net		—		—		11,402		—			11,402
Investments and advances to affiliates		9,851		11,615		1,334		(22,800	)		—
Other assets		109		18		6,363		—			6,490

Total assets	$	10,416	$	11,633	$	20,978	$	(22,800	)	$	20,227


LIABILITIES AND EQUITY
Current liabilities:
Current portion of long-term debt	$	507	$	—	$	328	$	—		$	835
Accounts payable and other current liabilities		76		17		2,108		—			2,201

		583		17		2,436		—			3,036
Long-term debt, less current portion		3,931		638		2,922		—			7,491
Other liabilities		—		—		3,515		—			3,515

Total liabilities		4,514		655		8,873		—			14,042
Equity:
Stockholders’ equity		5,902		10,978		11,822		(22,800	)		5,902
Noncontrolling interests		—		—		283		—			283

		5,902		10,978		12,105		(22,800	)		6,185

Total liabilities and equity	$	10,416	$	11,633	$	20,978	$	(22,800	)	$	20,227

CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS

Three Months Ended September 30, 2009
(Unaudited)


				WM			Non-Guarantor
	WMI			Holdings			Subsidiaries			Eliminations			Consolidated

Operating revenues	$	—		$	—		$	3,023		$	—		$	3,023
Costs and expenses		—			—			2,498			—			2,498

Income from operations		—			—			525			—			525

Other income (expense):
Interest income (expense)		(65	)		(10	)		(26	)		—			(101	)
Equity in subsidiaries, net of taxes		317			323			—			(640	)		—
Other, net		—			—			1			—			1

		252			313			(25	)		(640	)		(100	)

Income before income taxes		252			313			500			(640	)		425
Provision for (benefit from) income taxes		(25	)		(4	)		162			—			133

Consolidated net income		277			317			338			(640	)		292
Less: Net income attributable to noncontrolling interests		—			—			(15	)		—			(15	)

Net income attributable to Waste Management, Inc.	$	277		$	317		$	323		$	(640	)	$	277

Three Months Ended September 30, 2008
(Unaudited)


				WM			Non-Guarantor
	WMI			Holdings			Subsidiaries			Eliminations			Consolidated

Operating revenues	$	—		$	—		$	3,525		$	—		$	3,525
Costs and expenses		—			—			2,893			—			2,893

Income from operations		—			—			632			—			632

Other income (expense):
Interest income (expense)		(68	)		(11	)		(30	)		—			(109	)
Equity in subsidiaries, net of taxes		353			360			—			(713	)		—
Other, net		—			—			1			—			1

		285			349			(29	)		(713	)		(108	)

Income before income taxes		285			349			603			(713	)		524
Provision for (benefit from) income taxes		(25	)		(4	)		230			—			201

Consolidated net income		310			353			373			(713	)		323
Less: Net income attributable to noncontrolling interests		—			—			(13	)		—			(13	)

Net income attributable to Waste Management, Inc.	$	310		$	353		$	360		$	(713	)	$	310

Nine Months Ended September 30, 2009
(Unaudited)


				WM			Non-Guarantor
	WMI			Holdings			Subsidiaries			Eliminations			Consolidated

Operating revenues	$			$	—		$	8,785		$	—		$	8,785
Costs and expenses		—			—			7,354			—			7,354

Income from operations		—			—			1,431			—			1,431

Other income (expense):
Interest income (expense)		(198	)		(31	)		(77	)		—			(306	)
Equity in subsidiaries, net of taxes		800			819			—			(1,619	)		—
Other, net		—			—			1			—			1

		602			788			(76	)		(1,619	)		(305	)

Income before income taxes		602			788			1,355			(1,619	)		1,126
Provision for (benefit from) income taxes		(77	)		(12	)		486			—			397

Consolidated net income		679			800			869			(1,619	)		729
Less: Net income attributable to noncontrolling interests		—			—			(50	)		—			(50	)

Net income attributable to Waste Management, Inc.	$	679		$	800		$	819		$	(1,619	)	$	679

Nine Months Ended September 30, 2008
(Unaudited)


				WM			Non-Guarantor
	WMI			Holdings			Subsidiaries			Eliminations			Consolidated

Operating revenues	$	—		$	—		$	10,280		$	—		$	10,280
Costs and expenses		—			—			8,505			—			8,505

Income from operations		—			—			1,775			—			1,775

Other income (expense):
Interest income (expense)		(204	)		(30	)		(93	)		—			(327	)
Equity in subsidiaries, net of taxes		998			1,017			—			(2,015	)		—
Other, net		—			—			(2	)		—			(2	)

		794			987			(95	)		(2,015	)		(329	)

Income before income taxes		794			987			1,680			(2,015	)		1,446
Provision for (benefit from) income taxes		(75	)		(11	)		630			—			544

Consolidated net income		869			998			1,050			(2,015	)		902
Less: Net income attributable to noncontrolling interests		—			—			(33	)		—			(33	)

Net income attributable to Waste Management, Inc.	$	869		$	998		$	1,017		$	(2,015	)	$	869

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS

Nine Months Ended September 30, 2009
(Unaudited)


				WM			Non-Guarantor
	WMI			Holdings			Subsidiaries			Eliminations			Consolidated

Cash flows from operating activities:
Consolidated net income	$	679		$	800		$	869		$	(1,619	)	$	729
Equity in earnings of subsidiaries, net of taxes		(800	)		(819	)		—			1,619			—
Other adjustments		(20	)		(13	)		946			—			913

Net cash provided by (used in) operating activities		(141	)		(32	)		1,815			—			1,642

Cash flows from investing activities:
Acquisitions of businesses, net of cash acquired		—			—			(127	)		—			(127	)
Capital expenditures		—			—			(823	)		—			(823	)
Proceeds from divestitures of businesses (net of cash divested) and other sales of assets		—			—			20			—			20
Net receipts from restricted trust and escrow accounts and other, net		—			—			100			—			100

Net cash provided by (used in) investing activities		—			—			(830	)		—			(830	)

Cash flows from financing activities:
New borrowings		793			—			233			—			1,026
Debt repayments		(810	)		—			(332	)		—			(1,142	)
Common stock repurchases		(65	)		—			—			—			(65	)
Cash dividends		(428	)		—			—			—			(428	)
Exercise of common stock options		10			—			—			—			10
Distributions paid to noncontrolling interests and other		2			—			(86	)		—			(84	)
(Increase) decrease in intercompany and investments, net		698			32			(730	)		—			—

Net cash provided by (used in) financing activities		200			32			(915	)		—			(683	)

Effect of exchange rate changes on cash and cash equivalents		—			—			3			—			3

Increase in cash and cash equivalents		59			—			73			—			132
Cash and cash equivalents at beginning of period		450			—			30			—			480

Cash and cash equivalents at end of period	$	509		$	—		$	103		$	—		$	612

Nine Months Ended September 30, 2008
(Unaudited)


				WM			Non-Guarantor
	WMI			Holdings			Subsidiaries			Eliminations			Consolidated

Cash flows from operating activities:
Consolidated net income	$	869		$	998		$	1,050		$	(2,015	)	$	902
Equity in earnings of subsidiaries, net of taxes		(998	)		(1,017	)		—			2,015			—
Other adjustments		(11	)		(27	)		1,038			—			1,000

Net cash provided by (used in) operating activities		(140	)		(46	)		2,088			—			1,902

Cash flows from investing activities:
Acquisitions of businesses, net of cash acquired		—			—			(230	)		—			(230	)
Capital expenditures		—			—			(787	)		—			(787	)
Proceeds from divestitures of businesses (net of cash divested) and other sales of assets		—			—			92			—			92
Net receipts from restricted trust and escrow accounts and other, net		(2	)		—			151			—			149

Net cash used in investing activities		(2	)		—			(774	)		—			(776	)

Cash flows from financing activities:
New borrowings		644			—			447			—			1,091
Debt repayments		(371	)		(244	)		(591	)		—			(1,206	)
Common stock repurchases		(410	)		—			—			—			(410	)
Cash dividends		(399	)		—			—			—			(399	)
Exercise of common stock options		36			—			—			—			36
Distributions paid to noncontrolling interests and other		7			—			(89	)		—			(82	)
(Increase) decrease in intercompany and investments, net		672			290			(1,030	)		68			—

Net cash provided by (used in) financing activities		179			46			(1,263	)		68			(970	)

Effect of exchange rate changes on cash and cash equivalents		—			—			—			—			—

Increase in cash and cash equivalents		37			—			51			68			156
Cash and cash equivalents at beginning of period		416			—			—			(68	)		348

Cash and cash equivalents at end of period	$	453		$	—		$	51		$	—		$	504

- Definition

Text block that encapsulates the detailed table comprising the condensed financial statements (balance sheet, income statement and statement of cash flows), normally using the registrant (parent) as the sole domain member. If condensed consolidating financial statements are being presented, other domain members (in addition to parent) such as guarantor subsidiaries, non-guarantor subsidiaries, and the consolidation eliminations, will be included in order that the respective monetary amounts for each of the domains will aggregate to the respective amounts on the consolidated financial statements. The line items are the various captions used to compile the condensed financial statements. Using extensions, most, if not all, of the elements representing condensed financial statement captions will be the same as those used for the consolidated financial statements captions.

+ References+ Details

New Accounting Standards Pending Adoption

9 Months Ended

Sep. 30, 2009

New Accounting Standards Pending Adoption [Abstract]

New Accounting Standards Pending Adoption


13.	New Accounting Standards Pending Adoption

Consolidation of Variable Interest Entities — In June 2009, the FASB issued revised authoritative guidance associated with the consolidation of variable interest entities. This revised guidance replaces the current quantitative-based assessment for determining which enterprise has a controlling interest in a variable interest entity with an approach that is now 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 entity’s 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. This revised guidance 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. The new FASB-issued authoritative guidance associated with the consolidation of variable interest entities is effective for the Company January 1, 2010. The change in accounting may either be applied by recognizing a cumulative-effect adjustment to retained earnings on the date of adoption or by retrospectively restating one or more years and recognizing a cumulative-effect adjustment to retained earnings as of the beginning of the earliest year restated. We currently are in the process of assessing the provisions of this new guidance, but have not determined whether the adoption will have a material impact on our consolidated financial statements.

Multiple-Deliverable Revenue Arrangements — In September 2009, the FASB amended authoritative guidance associated with multiple-deliverable revenue arrangements. This amended guidance addresses the determination of when individual deliverables within an arrangement may be treated as separate units of accounting and modifies the manner in which transaction consideration is allocated across the separately identifiable deliverables. The amendments to authoritative guidance associated with multiple-deliverable revenue arrangements are effective for the Company January 1, 2011, although the FASB does permit early adoption of the guidance provided that it is retroactively applied to the beginning of the year of adoption. The new accounting standard may be applied either retrospectively for all periods presented or prospectively to arrangements entered into or materially modified after the date of adoption. We are in the process of assessing the provisions of this new guidance and currently do not expect that the adoption will have a material impact on our consolidated financial statements. However, our adoption of this guidance may significantly impact our accounting and reporting for future revenue arrangements to the extent they are material.

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