Gregory G. Nikkel - Director of IR David P. Steiner - CEO Larry O'Donnell, III - President and COO Robert G. Simpson - Sr. VP and CFO

Jonathan Ellis - Merrill Lynch Scott Levine - JP Morgan Bill Fisher - Raymond James Corey Greendale - First Analysis Chris Hussey - Goldman Sachs Leone Young - Citigroup Brian Butler - Friedman, Billings, Ramsey

Good morning, my name is Nicole and I will be your conference operator today. At this time I would like to welcome everyone to the Waste Management First Quarter 2008 Earnings Release Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks there will be a question and answer session. [Operators Instructions]. I would now like to turn the call over to Greg Nikkel, Director of Investor Relations. Mr. Nikkel, you may begin your conference. Gregory G. Nikkel - Director of Investor Relations: Thank you Nicole. Good morning everyone and thank you for joining us. With me this morning are David Steiner, Chief Executive Officer; Larry O'Donnell, President and Chief Operating Officer; and Bob Simpson, Senior Vice President and Chief Financial Officer. David will start things off with a summary of the financial results for the quarter and a review of the details of our revenue growth including price and volume trends. Larry will discuss operating costs and Bob will cover the financial statements. We will conclude with questions and answers. This call is being recorded and will be available 24 hours a day beginning approximately noon Central Time today until 5 PM on May 13th. To hear a replay of the call over the internet access the Waste Management website at wm.com. To hear a telephonic replay of the call dial 800-642-1687 and enter reservation code 39562966. As is our custom, I will remind you that during the course of this presentation we will be providing estimates, projections, and other forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities and Exchange Act of 1934. These forward-looking statements are subject to a number of risks and uncertainties which are described in detail in Waste Management's annual report on Form 10-K for the year ended December 31, 2007 and in the company's press release this morning. These risks and uncertainties could cause actual results to differ materially from those described in the forward-looking statements. During the course of the presentation, we will discuss free cash flow which is a non-GAAP financial measure. We will also discuss net income, earnings per share, earnings per share growth, income from operations, operating expenses, and operating expenses and income from operations as a percent of revenue, all adjusted for certain unusual or non-operational items which are also a non-GAAP financial measures. We have defined and reconciled those items as part of the earnings press release or the release 8-K filed today, which can be found on the company's website at wm.com. As I stated earlier, this call will be available for replay for a two week period. Time sensitive information given during the course of today's call which is occurring on April 29, 2008 may no longer be accurate at the time of the replay. Any redistribution, retransmission, or rebroadcast of this call in any form, without the expressed written consent of Waste Management is prohibited. Now, I will turn the call over to Waste Management's, CEO, David Steiner. David P. Steiner - Chief Executive Officer: Thanks Greg, and good morning. The first quarter was a strong one for Waste Management, and we once again achieved our primary financial goals of growing earnings, expanding operating margins, and generating strong free cash flow to return to our shareholders. We accomplish these financial goals despite the headwinds of rising diesel fuel prices, a U.S economic environment that was more challenging than it was at any time during 2007, and severe winter weather in the Mid West. We achieved our financial objectives by consistently following or strategy of disciplined pricing combined with cost control through operational improvements. It's an approach that's worked in the past and we intend to maintain it. And even in a challenging economic environment we believe our strategy will help us to meet our full year earnings and free cash flow projections. After adjusting for the items that we noted in today's press release we earned $0.47 per diluted share in this year's first quarter which is an increase of $0.04 per share or over 9% compared with the first quarter of 2007. Our results in the first quarter 2007 included a $0.02 per diluted share benefit from Section 45K tax credits. Without that benefit 2007 first quarter earnings would have been $0.41 per diluted share. On that basis year-over-year earnings would have grown $0.06 per diluted share over 14% in the first quarter of 2008. We increased income from operations as a percent of revenue year-over-year by 50 basis points to 15.6% in the first quarter of this year. Sharply higher diesel fuel prices impacted operating margin this quarter causing a negative 50 basis points impact. Excluding the impact of rising diesel prices income from operations as a percent of revenue would have expanded by a 100 basis points this quarter in line with our expectations for the quarter and for the year. As we go through 2008 we think it's important to look at margins absent any significant effects from the fuel surcharge program. Revenues grew 78 million or 2.4% in the first quarter this year with the most significant contributions coming from yield on our collection business and higher recycling commodity prices. Our internal revenue growth from yield on our base business was 3.2% marking the 9th time out of the last 10 quarters that our overall revenue growth from yield has exceeded 3%. If you include the benefit of higher recycling commodity prices and the impact of our fuel surcharge program, internal revenue growth from yield increased a total of 6.8% during the first quarter of 2008. Our collection pricing strategy continues to produce strong results. Combine the revenue growth from yield in the industrial, commercial, and residential lines of our collection business was 4.7% this quarter or 6.6% if we include the effect of our fuel surcharge. Pricing in the commercial collection line of business lead the way, with internal revenue growth from yield reaching 5.8% in the first quarter of this year. The yield components of internal revenue growth in our roll-off and residential lines of business were 3.8% and 4.1% respectively. These levels of revenue growth from higher yield is significant because they show that we've maintained our pricing discipline in spite of lower volumes. Another very positive sign of our pricing discipline is the strength of new business pricing in our roll-off business, which was up about 6% on a year-over-year basis, despite a continued softening in our temporary roll-off business. Our collection pricing programs have been the primary drivers of our earnings growth and margin expansion. As we expected and as we have seen for sometime, our pricing programs again affected our volumes but the trade-off remains positive as we've shed lower margin and unprofitable business. We've consistently followed our strategy to price our services to generate adequate returns on our investments, to fully recover our cost, and to expand our operating margins. In doing so we've targeted unprofitable and low margin business. Where we have lost volumes, we focused on flexing down our operating cost. The net result is higher income from operations and significant margin expansion in our collection line of business. The income from operations from our collection business grew by over 11% in the first-quarter of this year compared with the same period of 2007. And our income from operations margin in our collection business expanded by over 200 basis point. Our recycling operations turned in another strong performance in the first-quarter of the year, on the strength of higher recycling commodity prices and better re-bate structure that we have negotiated with our customers. Turning now to volume side, internal revenue growth from volumes on base business declined 3.9% in the first-quarter of 2008. Caused mainly by our pricing programs, economic related declines which occurred primary in our roll-off line of business and the harsh winter weather in the Mid West. However, the 3.9% rate of decline is the best work day adjusted volume performance we've had since the third quarter of 2006. Most of the volume loses in the quarter was in the collection side of the business, which fell by 5.7% during the first quarter of 2008. We estimate that our pricing program caused roughly 55% of collection volume loss, with the remainder due to the economy and bad weather. This is very close to the same pattern that we saw in the fourth quarter of 2007. During the course of 2008, we still expect the rate of decline in our volumes to improve partially because of easier year-over-year comps and partially because the most economically sensitive part of our business, temporary roll off, already saw a significant decline in 2007. We don't expect to see those levels of decline in our roll off business during 2008. And the other segments of our business is fairly recession resistant. So even in a slow economy, we still expect the rate of volume decline to moderate in 2008. Over the last few weeks, we've seen the volumes improve, although it's not clear whether this is a result of seasonality, the economy, or built-up demand from the harsh winter weather in the first quarter. We always say that the first few weeks of the quarter are not necessarily indicative of results for the full quarter, but our volume reports from the first few weeks of April are certainly consistent with our expectations of moderating volume declines for the full year. In conclusion, our strategy again worked well and we plan to continue to execute it. I am pleased with the first quarter results, not only because we accomplished our primary financial goals but also because we overcame the impact of higher diesel fuel prices and harsh winter weather. We will continue to maintain our pricing discipline and control our operating costs, and we expect our operating cost as a percent of revenue to improve as we come out of the winter month. The first quarter has positioned our company for a successful 2008 and we are confident that we will meet the earnings and free cash flow targets we setout at the beginning of 2008. With that, I'll turn it over to Larry, who will review our operating cost results. Larry O'Donnell, III - President and Chief Operating Officer: Thank you Dave and good morning everyone on the call. I am going to cover our operating cost results for the quarter. Operating expenses in the first quarter of 2008 were $2.092 billion or $58 million higher than in the 2007 quarter. As a percent of revenue, this is a 30 basis point increase in our operating cost from 63.8% of revenue to 64.1% of revenue. Excluding the impact of higher recycling commodity and higher diesel fuel prices, operating cost would have been $51 million lower during the first quarter of 2008 compared to the same period last year. Excluding these costs and their associated revenue, operating expenses as a percent of revenue would have improved by 80 basis point. I am pleased to say that we made good progress in managing our controllable operating costs in nearly all other areas during the quarter. On a percent of revenue basis we lowered first quarter 2008 operating costs in seven of the ten cost categories that we break out in our financial statements. These improvements once again show the positive impact of our consistent focus on controlling costs and pricing excellence and also reflect the impact of increased revenues from higher recycling commodity prices and fuel surcharges. Our labor and benefits costs improved by 45 basis points as a percentage of revenue during the first quarter of this year. On an absolute dollar basis, we held these costs flat when compared with the first quarter of 2007. This shows that we continue to flex down costs as volumes decline. We reduced our driver hours by about 728,000 hours in the first quarter of 2008 compared with the same period in 2007. Approximately 54% of this reduction was due to the ability of our field mangers to actively flex down our labor costs as volumes have declined. The remainder of the reduction in driver hours was due to divestitures. The first quarter is usually our toughest quarter for efficiency improvement in the unusually harsh winter weather during the quarter particularly in the Midwest certainly provided us some challenges. For example we experienced 25 days during the quarter where locations in the Midwest had to shut down operations and we had 2600 route days where we suspended or cancelled routes due to weather. We estimate that the severe winter weather cost us about $0.01 in earnings during the quarter. We expect to see stronger efficiency improvements going forward this year. Our maintenance and repair costs increased by only $2 million in the first quarter this year compared to the first quarter last year which is approximately a 15 basis point improvement as a percent of revenue. I should note that maintenance and repair expenses at our Wheelabrator waste energy facilities increased by $6 million in the first quarter. The maintenance cost at the Wheelabrator facilities can fluctuate from quarter-to-quarter based on our scheduling of outages to perform maintenance and repairs. The level of expenditure at Wheelabrator during the first quarter of this year was consistent with our operating plan for the year. After adjusting for the Wheelabrator increases, maintenance cost improved on a year-over-year basis. This shows that our fleet maintenance improvement efforts have helped to offset the higher cost and labor rates, steel for us and oil based supplies such as lubricants. Considering that we estimate an annual inflation on our maintenance cost to be at least 4% I am pleased with this results. We expect to see continued progress in our maintenance cost during the year. Risk management cost improved nearly 20 basis points as a percent of revenue driven by lower workers compensation cost. The primary reason for the continued reduction in our risk management cost has been our tremendous improvement in our safety performance. This was the 29th consecutive quarter in which we improved our total reportable injury rate which is a safety measure. We improved our TRIR by about 10% in the first quarter this year compared to the same period in 2007 to a TRIR of less than 4. Transfer and disposal expenses which include those costs that our collection companies paid the third party land fills and transfer stations improved by over 90 basis points as a percent of revenue in the first quarter of 2008. Our improvements in this area reflect our continued focus on fixing or exiting low margin collection businesses where we don't internalize the volume. Sub-contractor cost improved by about 5 basis points in the quarter as we used pure third party contractors due to the lower volumes and divestitures. This was partially offset by higher fuel cost, passed on to us by third party contractors. Higher direct diesel fuel cost caused 110 basis point increase in operating expense as a percent of revenues. Average fuel costs in the first quarter of 2008 were about $1 per gallon higher than in the first quarter of 2007. These record high diesel prices, not only negatively affected our operating margins, but also lowered earnings by approximately $0.01 per share because the fuel surcharge revenue lagged the steep increase of both higher direct fuel cost and the indirect fuel cost passed on to us by sub-contractor haulers. Due to the higher recycling commodity prices in the first quarter of 2008, our cost of goods sold category increased by nearly a 140 basis points. While this negatively impacted our reported operating expenses and squeezed our operating margins, the overall impact on our recycling earnings in return is positive. We expect recycling commodity prices to remain strong throughout 2008. I am pleased with our performance in controlling our operating costs. Our progressing these areas was due to the efforts of our employees who continued to utilize the tools, systems, and standard practices that we've deployed over the last several years. We remain committed to our cost control and pricing strategy, which we expect will drive the operational and financial success that we project for the remainder of 2008. With that I'll turn the call over to Bob. Robert G. Simpson - Senior Vice President and Chief Financial Officer: Thank you Larry, I will start with a review of SG&A cost for the first quarter of 2008. SG&A expenses were 11.3% of revenue during the first quarter of 2008, which was in line with our expectations. Our year-over-year costs increased $15 million in the first quarter of 2008 compared with the first quarter of 2007. This year-over-year increase was primarily due to increased sales and marketing spending and an increase in our provision for bad debts. Depreciation and amortization expense for the first quarter of 2008 was down $13 million when compared with the first quarter of 2007. The year-over-year decline is primary due to the impacts of lower landfill volumes and divestitures. As a percent of revenue, depreciation and amortization expense was 9.1% compared with 9.7% in the prior year quarter. Interest expense was $122 million in the first quarter of this year, a $13 million decrease from 2007. This decrease was due primarily to the lower interest rate environment we have seen in 2008. Interest income decreased $13 million year-over-year due in part to the decrease in our cash and investment balances and the lower interest rate environment. In addition in the first quarter of 2007 we received $7 million in non-recurring interest income from the favorable resolution of a tax mirror. Moving to income taxes, in our press release we noted a $6 million benefit to net income in the first quarter of 2008, compared with the benefit of $16 million in the first quarter of 2007. These benefits result primarily from income tax audit settlements. In the first quarter of 2008, our effective tax rate excluding the $6 million benefit was approximately 39%. We expect our effective tax rate for the remainder of the year to be approximately 40%. Total reported debt increased by $382 million at the end the quarter compared with the end of 2007. Our adjusted total capital ratio increased to 60.8%, inline with our objective to be around 60%. In March of this year, we issued $600 million in senior notes, priced at about 6%. We used a portion of these funds to pay down borrowings on our credit revolver and on May 1, we will repay $244 million of senior notes that would have matured in 2018, but are callable. The interest rate on those notes is 8.75% which makes calling the notes attractive. We produced strong free cash flow during the first quarter. Net cash from operations was $561 million with capital expenditures of $213 million during the quarter, including $14 million of net proceeds from divestitures and sales of assets, our free cash flow was $362 million for the quarter. We repurchased approximately 9 million shares for $281 million during the first quarter. We also paid $133 million in cash dividends, marking the first payment of our higher quarterly dividend of $0.27 per share which is a 12.5% increase over the last year. At yesterday's closing stock price, our dividend payment equates to a yield of over 3%. As we previously noted, we expect the amount we will spend on acquisitions during 2008 will exceed proceeds from divestitures and asset sales during 2008. In the first quarter of this year, we spent approximately $70 million for acquisitions while receiving approximately $14 million from proceeds from divestitures and asset sales. In closing, we are off to a solid start for the year, and as David and Larry indicated, we will continue to execute our pricing and operational excellence strategies. We are confident, this will lead to our achieving the full year 2008 earnings and cash flow guidance which we reaffirm today. And with that Nicole, let us open the line for questions. Question And Answer

[Operator Instructions]. Your first question comes from the line of Jonathan Ellis with Merrill Lynch. Jonathan Ellis - Merrill Lynch: Good morning guys. Robert G. Simpson - Senior Vice President and Chief Financial Officer: Good morning. David P. Steiner - Chief Executive Officer: Good morning. Jonathan Ellis - Merrill Lynch: Wondering if you can talk a little bit more about pricing at the landfills and specifically gate rates versus contract pricing at the landfills? David P. Steiner - Chief Executive Officer: Yeah, you know Jonathan overall when you look at it on a per ton basis we are seeing pricing in the 3% to 5% range. Clearly we are seeing gate rates that are above that and we are seeing contract renewal rates... when we see the contract renewal rates up here we are seeing them in the range of 7% to 10%. So obviously we are not able to hit all of that contracted volume in any one particular year, but overall we think the pricing program at the landfills is working very well. We expect that to continue. Jonathan Ellis - Merrill Lynch: Great and could you talk about where you are in percentage terms or may be qualitatively, how far are you along in revising landfill contracts? David P. Steiner - Chief Executive Officer: How do you mean reviving landfill contracts? Jonathan Ellis - Merrill Lynch: As they come up for renewal and seeking to get more favorable terms, what percentage of the contracts are coming for renewal at this point that you have successfully renegotiated for higher rates? David P. Steiner - Chief Executive Officer: Yes, when you look at it and there is two things, there is higher rates and then there is as you say there is better terms i.e. things like the fuel surcharge, the environmental surcharge. A number of those contracts were allowed to pass those through under the contract already. About two years ago we started, actually probably more like 3 or 4 years ago, we started putting in to all of our contracts, whether they were collection, large miniscule collection contracts, or landfill contracts, we started putting in provisions that allowed us to pass through things like change in law provisions because you have fees and taxes that are raised to state. So most of our contracts have gone through that. As far as the pricing goes, my guess is and it will only be a guess, because of the amount of time that we've been in landfill price is excellent, is that we've gotten through roughly half of our contracts that have gone through price increases in last 2 years. Jonathan Ellis - Merrill Lynch: Okay great and just on the volume side, could you talk a little bit more again at the landfills about volume trends for MSW, C&D, and special waste? David P. Steiner - Chief Executive Officer: Yes, they're following sort of the same trends that we saw late last year. We do think that we've seen a drop in those volumes, as of late last year, but they are following the same trend. And when I say the same trend, C&D is down more than special waste and MSW obviously because of the housing market. But what we see, its always a little bit difficult to talk about volumes in the fourth quarter and in the first quarter because of how seasonality affects us, but we do believe that we've seen a drop in the volumes and that we're going to see the volumes, the rate of decline improved throughout 2008. Jonathan Ellis - Merrill Lynch: Okay great and would you be able to, I don't know if you have this information available, but break out internal revenue growth from yield for the permanent versus temporary roll-off businesses? David P. Steiner - Chief Executive Officer: No, we do not have that broken out Jonathan. I am sorry, we don't break it out that way ourselves. I'd love to give it to you but we don't break it out ourselves that way. But as we said the overall increase was 3.8% and new business pricing, I think even more importantly, when you're in a down economy to have new business pricing up 6% in the industrial line, I think is a pretty strong accomplishment. Jonathan Ellis - Merrill Lynch: Great. And just very quickly on IRG from yield do you have what the impact from environmental fees were this quarter on that number? And the total number for the company? David P. Steiner - Chief Executive Officer: Yes. Greg has that number. Gregory G. Nikkel - Director of Investor Relations: Yeah that number... year-over-year increase was about $20 million due to the increased environmental fee. Jonathan Ellis - Merrill Lynch: Great. And then just my final question is are you seen any increase push back from customers either for higher environmental fees or higher fuel surcharges given with the microeconomic back drop? David P. Steiner - Chief Executive Officer: You know we really aren't, I think we always expected to see that and quite frankly over the last three years, we've always thought that there might be a little bit more pushback. But I think that consumers, they see the news just like we see the news. They know that the cost are going up, they particularly know the fuel cost are going up. And so certainly you have some folks to ask about it. We do a very good job on our website and in out communications with our customers of telling them why they are coming through. But we really haven't seen any losses of volumes because of the surcharges. Jonathan Ellis - Merrill Lynch: Okay, great. Thanks guys. David P. Steiner - Chief Executive Officer: Sure.

Your next question comes from the line of Scott Levine with JP Morgan. Scott Levine - JP Morgan: Hi guys. David P. Steiner - Chief Executive Officer: Good morning. Good morning. Scott Levine - JP Morgan: It sounds like the volumes came in for the quarter maybe in line little better than you guys had expected, given what happened with weather in the mid-West. Could you take a stab at quantifying the impact that the harsh weather had on your volumes? And give us a little bit of a sense as to what expectations you have baked into your expectations for the year for volumes including both the temporary roll-off segment, this cyclical business lines you have? Robert G. Simpson - Senior Vice President and Chief Financial Officer: Yes remember, at the beginning of the year we said volumes negative 2.5% to 3%. So clearly the first quarter was a little bit weaker than that. Now also remember that during the course of the year comps get easier too. So we are going to get some benefit from that. But again, it's difficult to see what happens in the third quarter and in the fourth quarter because of weather, we think that the harsh weather probably cost us about 20 basis points in our volume. But the good news that we've seen is that very virtually all of the line, we've seen the rate of decline slow. Even in our temporary roll-off line where we down about 9.4% and in our C&D line where we're down 15% which are big numbers, but are way-off of where the high numbers were at last year. So we do expect during the course of the year, even in a weaker economy that we're going to see volumes improve. One of the other statistics that we look at that's... that I think gives us optimism for the year is new business. And we added about 23% more new business in the first quarter than we did in the first quarter 2007. So again it's a little bit difficult to make a call just based on the first quarter because of the severe effect of weather. And again, like I said it's a little bit difficult to use the first few weeks of April to indicate what's going to happen in the second quarter. But certainly when we look at it over a longer period of time over a three, four quarter period of time, we think we've seen the drop in volumes and we think we'll see the rate of decline moderate during 2008. Scott Levine - JP Morgan: Understood. Turning to... turning to recycling, could you have sort of guess on what the EPS... it's something that was a benefit in the quarter. Has there I guess somewhat the impact was there, and when you say further strength in recycling is expected throughout '08, do you mean further increases in the cycle commodity prices? Or you kind of expecting prices to remain at current levels? Robert G. Simpson - Senior Vice President and Chief Financial Officer: The pricing... the commodity pricing, we expect it, really stay about what we've seen at current levels, much like what we saw throughout last year. When you look at... in terms of what impact it had on EPS that was about $0.02. Scott Levine - JP Morgan: Okay. And lastly turning to SAP I was hopping you guys maybe able to give us an update, we have seen some news items on the tape in recent months. David P. Steiner - Chief Executive Officer: Quite frankly SAP turned into as you can imagine a big disappointment for us. I mean, basically it a simple case and we don't use the word lightly, its a simple case of fraud, where SAP promised us a product and then... and knew they did not have it and try to cover up the fact they didn't have it. What they promised us what they guaranteed does in the contract was an out of the box solution without modification. In fact when they demonstrated it to us what they did was base fake the mark up, so they looked like it was out of the box solutions. And then when they went and piloted it in New Mexico, they basically and knew that the product didn't work, but they tried to get us to pay for fixing it when they were responsible for fixing it under the contract. And we found out what was going on, we said we got a contract with you folks, we want you to fix the software like you promised us and you've got to pay for it on your nickel not on our nickel. At that point they refused to fix the software and we sited them. So... and they refused to fix the software once again. So, again it's a simple case of fraud and fully expect to receive all of our damages when we got to trail. Scott Levine - JP Morgan: And too early to think about the charge here at this stage again?

Scott, I think that right under the accounting rules, you have to make that decision once you really come to a point where you are having another plant in place. We are studying how the alternative now, we successfully migrate in Mexico back to the old system NAS. We're going to make some enhancement to NAS that will help us to achieve some of the benefits we are hoping to get. And we'll continue, we're looking at other alternative. Now when we make a final decision on what those alternative are and perhaps make a commitment to go down that road, we'll re-visit when the write-off will take place. At this point, the write-off is between... somewhere between $46 million and $51 million. It's just a matter of the timing. Scott Levine - JP Morgan: Got it. Thanks guys. Nice quarter. David P. Steiner - Chief Executive Officer: Thank you. Robert G. Simpson - Senior Vice President and Chief Financial Officer: Thank you. Thanks.

Your next question comes from the line of Bill Fisher with Raymond James. Bill Fisher - Raymond James: Well I just had two minor questions, on the recycling side it looks like you had $1.2 billion, $1.3 billion run rate now. I was just wondering what the rough size of the brokerage operation is, right now? David P. Steiner - Chief Executive Officer: Our brokerage out of the total is probably somewhere around 30% to 40% now. That's... we actually saw increased brokerage in Q1. That continued to be good business for us as we have described in the past, a good returns that we get from that business. Bill Fisher - Raymond James: Okay. And just for Bob, in terms... I know you did some things of debt in the quarter. What would be the rough mix of the fixed debt now at the end of March? Robert G. Simpson - Senior Vice President and Chief Financial Officer: 36% of our entire debt is floating. Bill Fisher - Raymond James: Okay. Thank you very much. David P. Steiner - Chief Executive Officer: Thank you.

Your next question comes from the line of Nicole Douglas [ph] with Deutsche Bank.

Can you hear me? David P. Steiner - Chief Executive Officer: Yes, go ahead Nick.

Okay sorry. I just... most of my questions have been answered. But going back you guys said that you expect acquisitions to offset divestures fully this year and come in ahead. I was hoping you might be able to talk about the deal pipeline and if you see deal activity picking up? David P. Steiner - Chief Executive Officer: Yes, actually what we said was that we think we will spend more and... the last couple of years we spend on more divestiture mode. This year we think that it will switch around we'll be more in acquisition mode than we are in divestiture mode. With $70 million in the first quarter as opposed to $14 million in divestitures, we pointed out that is sort of the turning point for us. So when we look at the deal pipeline, we see some good deals out there. We see some deals out there that are not only good solid tuck-in acquisitions for us, but actually some that will help us provide some services to our customers that we currently don't provide to our customers. And so when we look at business through out the country, we got customers that are looking for more C&D recycling. We've got customers that are looking for more electronics recycling. We've got customers that are looking for a lot of different services in addition to there solid waste. So we not only see a good solid pipeline in the solid waste business, but we see a good pipeline and the other businesses that are very closely related to our core and that our customers want.

Okay. Great that's helpful. Thank you David P. Steiner - Chief Executive Officer: Sure.

Your next question comes from the line of Corey Greendale with First Analysis. Corey Greendale - First Analysis: Morning. David P. Steiner - Chief Executive Officer: Good morning Corey. Robert G. Simpson - Senior Vice President and Chief Financial Officer: Good morning. Corey Greendale - First Analysis: Yes it seems to be a bit of a lag probably afraid I'll start swearing or something. David P. Steiner - Chief Executive Officer: We hope we didn't have a quarter that caused you to swear. Corey Greendale - First Analysis: It only be in a good way. So the first question I think David in answering another question you said that new business was up 23% from last year, did I get that right? And what's the pricing look like on that new business? David P. Steiner - Chief Executive Officer: Yes, when we price our new business clearly we are pricing at levels that are much higher. When you look at it and again we'll talk about the commercial line of business. From the commercial line of business you see the new progress again similar to the roll-off line of business up in the 6% to 8% range. And then... that's year-over-year. And, the new business pricing its not a huge amount of dollars, it's about a $1.5 million, but it's good to see that we're now adding more business than we're shutting, and we expect that again to continue throughout 2008. Corey Greendale - First Analysis: And, I know you've been adding more on the sales and marketing side, do you think their new business... I would assume given what the economy is doing with, that's more taking share than it is new business developments or new municipality that kind of things. So is your sense that you're taking share from smaller players or where's that business coming from? David P. Steiner - Chief Executive Officer: Oh, I think that you do see a little bit of organic growth. But Corey, we'd never really looked at... we look at where we're losing the business to, clearly we're predominantly losing the business to the local regional player, just a map I would assume that we're gaining share from those local regional players. Corey Greendale - First Analysis: Okay. Then I wanted to ask about your customer audit. I think you said last call that you were moving more towards the national accounts now and just wondering how that effort is going? And how much longer you have to go on that whole project? David P. Steiner - Chief Executive Officer: Yes, the national accounts part of it, your absolutely right, the national accounts is the slower part, because you have to audit the customers throughout the footprint of the national account before you're ready to do anything. We expect that will end third, fourth quarter of this year. And how is it going? Obviously with national accounts you're not going to have as much success as you have with individual accounts. But again, our customers recognized just like everybody that fuel prices are going up, they're getting cost sensitive too. So we are actually having some pretty good success passing through some of those costs. Corey Greendale - First Analysis: And Dave, when you say not as much success, do you mean more customers are choosing to walk away to competitors? Or you mean it is getting lesser price increases? David P. Steiner - Chief Executive Officer: Yes, no we're just getting lesser price increases. Most of these national accounts we have a contract with. And so it's a little bit harder to get a price increase from someone that you have as firm contract with and someone that you have a contract that allows for the price increase. Corey Greendale - First Analysis: And a question for Larry, you... in going to the cost items, you talked about the relative impact on labor cost flexing down cost for lower volume and then divestitures. Can you talk about how much opportunity remains to take routs out or improve routing efficiency independent of volume declines? Larry O'Donnell, III - President and Chief Operating Officer: Well, I think there is still opportunity to do that. As we went through the BIP process, and actually lost some of those customers, what we're now doing is going back through and looking at our route structure and doing a lot rerouting to make sure that we're been rebuilding those routes where they... they are much more efficient than they were before, particularly with the economy, it's slow as it is. But I guess its an opportunity to really look at how we're running our routes and get some efficiencies out of that. So in terms of where we are in the process, I really couldn't estimate how far or long we are but it is our plan to get through all those reroutes, that's something we always do. But in terms of the ones related to BIP that's part of what our focus and our plan is for this year, is to get through rerouting that had to do with VIP changes in our route structure. Corey Greendale - First Analysis: Okay. Thanks very much.

Your next question comes from the line of Chris Hussey with Goldman Sachs. Chris Hussey - Goldman Sachs: Good morning fellows. David P. Steiner - Chief Executive Officer: Good morning. Robert G. Simpson - Senior Vice President and Chief Financial Officer: Good morning. Gregory G. Nikkel - Director of Investor Relations: Good morning. Chris Hussey - Goldman Sachs: Quick questions. Maybe you could just follow-up a little bit, comments you made about the volume improvement you're seeing in April, just a little bit more color on that. Are you seeing out of any particular end market, any particular region that's doing better than other? David P. Steiner - Chief Executive Officer: We're really seeing sort of what we've seen over the last year which is, and what we talked about back when the economy was booming which is, if you want to be a company that's focused primarily in the sunbelt, you're going to do great when the economy is booming. But you're not going to so great when the economy is not booming. And we always said that our geographic foot print for us is something that we think over the long-term is going to benefit us. So what we seen us is not so much in the mid-West and the East are booming, but they never did boom, so they are not slowing down quite as fast. And so the mid-West and the East are strong for us in the sense that they are maintaining a slower declined of volume, even though we've continue to see volume decrease in the West and in the south. And so again we think it an indication that our geographic foot print in an economic downturn is going to benefit us just like sometimes it hurt us when the sun belt state boom. Chris Hussey - Goldman Sachs: So but the reason observation is then very said not seeing necessary thing coming out of the self in the West but actually seeing things maybe improving more out of the mid-West and the East? David P. Steiner - Chief Executive Officer: Relatively speaking they are improving better in the mid-West than the east. Chris Hussey - Goldman Sachs: Okay. That is fair. And then I can't help myself with talking about the acquisition strategy you mentioned in subery [ph] services might this include buying some more storage services? David P. Steiner - Chief Executive Officer: Yes not in the foreseeable future I mean certainly we're in that business, we're not made business in a big way. When I talked about closely related to our cored that is they would just a business but its not as closely related cored as the thing that current customer are again things like in C&D recycling, electronic recycling lot of different program, single stream recycling from municipality. Certainly I won't preclude us from being more into the storage business. But I don't see doing the material acquisition in that arena in the near future. Chris Hussey - Goldman Sachs: So more about recycling acquisition then?

Recycling and solid waste, core truck in solid waste acquisition. Chris Hussey - Goldman Sachs: Great, usual stuff. And how about waste energy and any thought there? David P. Steiner - Chief Executive Officer: You know waste energy as we talked about, there are more of these on the street in waste energy today than there have been in the last 20 years and we full expect to play in that arena. Chris Hussey - Goldman Sachs: So you guys will, when should we expect you guys to start and when are you going to start to open more of waste energy plants. David P. Steiner - Chief Executive Officer: Well you know it's not really up to us, it's up to the bidding process, so when you look at the RLPs, it's really up to the municipalities to determine the timing on that. Chris Hussey - Goldman Sachs: What's your best guess? David P. Steiner - Chief Executive Officer: Well you know those things take a long period of time if you look for example, Baltimore's just announced that they are going to look to build a new 1500 ton plant and we expected that RLP to come out probably nine months ago. So you know those things take some time. The municipalities have to work through the issues that they have got with the public and they have got to work through siding issues and so it's really difficult for us to even guess but I would expect that you will see a couple of those bids awarded in 2008. Chris Hussey - Goldman Sachs: Great, last question on the landfill pricing, you said that about 505 through... 50% of contracts you haven't really touched pricing on, what could we expect in contracts that you had touched pricing on. When we... as we go forward what do you think the sustainable pricing growth of your landfill is? David P. Steiner - Chief Executive Officer: Yes, you know when you look at the landfill and you know we have talked about it quite a bit which is that you can be a little bit more aggressive in the pricing of the landfill because it's not like an airline seat. You know, an airline seat if you don't sell it today, you will never sell it again. You would have turnabout of land to air space [ph]. If you don't sell it today there is only one thing you can be guaranteed of, you will sell it for more in the future. So you know long term I think that the landfill pricing should exceed the collection pricing. You know it is a little bit difficult for us to go through and analyze this because obviously you have got three different streams in there that are priced completely different. You have got a huge mix issue in other words between special waste C&D and MSW. So when we look at it, we look at it primary from an MSW point of view, and from an MSW point of view and we certainly think that land field pricing should meet our long-term pricing goal which is 50 to 100 basis point above CPI if not better. Chris Hussey - Goldman Sachs: Thanks guys. Appreciate it. David P. Steiner - Chief Executive Officer: Thank you. Robert G. Simpson - Senior Vice President and Chief Financial Officer: Thanks Chris.

Your next question come from the line of Leone Young with Citigroup. Leone Young - Citigroup: Yes good morning. David P. Steiner - Chief Executive Officer: Good morning Leone. Robert G. Simpson - Senior Vice President and Chief Financial Officer: Good morning. Leone Young - Citigroup: First of all just as you mentioned the obviously the rest two businesses out roll-off is pretty defensive. In fact are you seeing any impact from the economy, in your sort of bread and butter of commercial line of business changes in service intervals that 10%? David P. Steiner - Chief Executive Officer: Yes we are seeing as slight changes in the service intervals probably that was about Greg remind me if I am wrong, about $500,000 less of an increase. In other words, we are still getting net service increases, but it was about $500,000 less of an increase than it was last year. So we are still seeing net service increases, just at a little bit of slower rate. And again its hard to tell with that small of a number $500,000 its really hard to tell, if that's from the economy or that's just a natural order of thing. So we don't see anything in the commercial line of business that leads us to be overly worried that we are going to face a dramatic drop-off in the next three quarters. Leone Young - Citigroup: And also on SG&A, Bob mentioned that it was largely in line of what you expected in the first quarter. But turning perhaps bit higher than previous goals you would had, would you take a shallow lead on longer term or '08 target for SG&A? Robert G. Simpson - Senior Vice President and Chief Financial Officer: Or if we, I think we set the---real, hit the beginning of the year the forecast was about a little over 10.5% and I would not change in that all. Over the longer terms, our goal was to get it down in to nine or below and lot of the investments we are making right now, we think will help us get there. Leone Young - Citigroup: That's great. And then just lastly still looking for about $1.5 billion in CapEx? Robert G. Simpson - Senior Vice President and Chief Financial Officer: Yes that's right at this point, we are very focused on it and well the fleet purchases that we intend to make this year, we intend to make, because of the 2010 engines in effect that we under bought in 2007. So we are very focused on land field construction if the volumes slow down at the point where we don't need to expand or salvage here, we will put that off if the, volume are such to container purchases are not necessary we will deal with that do, we got our eye on it and we will continue to reflect down as we need to and the meantime we will, we are not going to change our estimates right now. Leone Young - Citigroup: Terrific. Thanks a lot. David P. Steiner - Chief Executive Officer: Alright. Robert G. Simpson - Senior Vice President and Chief Financial Officer: Thank you Leon.

Your next question comes from the line Brian Butler with FBR. Brian Butler - Friedman, Billings, Ramsey: Yes, Good morning. David P. Steiner - Chief Executive Officer: Good morning Brian. Robert G. Simpson - Senior Vice President and Chief Financial Officer: Good morning. Brian Butler - Friedman, Billings, Ramsey: One quick question on the depreciation and amortization little bit low on the lower side as the volumes slow up is that kind of the amount of percent of revenue basis kind of the right number to looking at kind of that 9%, 9.1%? Robert G. Simpson - Senior Vice President and Chief Financial Officer: You know I think it some where between 9.1% and 9.5%. Its probably where you are to be thinking is volumes come back or is volume pick up during the year, that could very well build up some more. So it's just a matter of where the volumes actually come out. Truly 75% of the difference is related to the lower volumes into the land field. Brian Butler - Friedman, Billings, Ramsey: Okay. And then a one quick question on your marketing campaign, you guys have been out there, pushing marketing side, from a strategic point of view are you, how is that paying off are you seeing any intangible benefits, either in the bidding process or any where else and what you think of that program on a go forward basis? David P. Steiner - Chief Executive Officer: Yes Brian I think from our point of view we see both tangible and intangible benefits, we have talked about it quite a bit in the past few years that from a tangible point of view, you know its always hard to measure the bank for the bulks from an advertising point of view and so we have to, we measure it by looking at actually how consumer attitude change as a result of the advertising campaign, in other words what are the attitudes before ads and what are the attitudes after the ads and we started the campaign we were getting changes in consumer attitude in the range of 40% to 50%. We are still getting changes in consumer attitude in the range of 20 to 30% and so certainly from a measurement point of view, we are still seeing the benefits now from a anecdote point of view I think the point you make is exactly right, we hear from a lot of customers and in fact I can tell you, every time I have met with the customer, one of the things they say, is we have seen your ad campaign and we love your ad campaign and that goes all the way from the small commercial customer to the large industrial customer to the municipality. Also Anecdote when we talked about Land field expansion and we talk about permits that we have made it, we have had both safe at us, it helps us to review your process, that you have got this ad campaign that makes the public field little bit better about you and any time you go in front of the public for a public hearing and the public feels a little bit better about your company you are going to have an advantage, so I think we have seen full tangible and intangible benefits and then finally from our current employees and from prospective employees we get the same thing, from prospective employee we hear vow, we didn't realize you all did, all of these amazing things this sound like a great place to work and from our current employees obviously you get that feeling of proud that they get every time that they see commercial on TV, so we have certainly got a number of measurable benefit and we continue to receive intangible benefits. Brian Butler - Friedman, Billings, Ramsey: Great thanks a lot guys. David P. Steiner - Chief Executive Officer: Thank you, thanks a lot.

There are no further questions at this time. I will now turn the call back over to Mr. David Stenier for any closing remarks. David P. Steiner - Chief Executive Officer: Thank you, Nicole. Well clearly we are very happy with our first quarter and we are very optimistic for 2008. We look forward to sharing our results with you during the course of the year. And we look forward to see in all of you all on the road as we get out their during the course in year. Thank you for joining us again.

Thank you participating in today's Waste Management first quarter 2008 earnings conference call. This call will be available for replay beginning at 12'o clock AM Central Time today through 11:59 PM Eastern Standard Time, on Tuesday May 13, 2008. The conference ID number for the replay is 39562966. Again the conference ID number for the replay is 39562966. The number to dial for the replay is 1-800-642-1687 or 706-645-9291. This concludes today's conference call. You may now disconnect.