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x		ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
		For the fiscal year ended December 31, 2004
		OR
o		TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
		For the transition period from                        to

Delaware		65-0716904
(State of Incorporation)		(I.R.S. Employer Identification No.)
Republic Services, Inc. 110 S.E. 6th Street, 28th Floor Fort Lauderdale, Florida (Address of Principal Executive Offices)		33301 (Zip Code)

Title of Each Class		Name of Each Exchange on which Registered
Common Stock, par value $.01 per share		The New York Stock Exchange

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				Page Number
Item 1.		Business			1
Item 2.		Properties			18
Item 3.		Legal Proceedings			19
Item 4.		Submission of Matters to a Vote of Security Holders			19
Item 5.		Market for the Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities			20
Item 6.		Selected Financial Data			22
Item 7.		Management’s Discussion and Analysis of Financial Condition and Results of Operations (including Item 7A)			23
Item 8.		Financial Statements and Supplementary Data			50
Item 9.		Changes in and Disagreements with Accountants on Accounting and Financial Disclosure			87
Item 9A.		Controls and Procedures			87
Item 9B.		Other Information			88
Item 10.		Directors and Executive Officers of the Registrant			89
Item 11.		Executive Compensation			89
Item 12.		Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters			89
Item 13.		Certain Relationships and Related Transactions			89
Item 14.		Principal Accountant’s Fees and Services			89
Item 15.		Exhibits and Financial Statement Schedule			90
		Signatures and Certifications			93
Subsidiaries of the Company
Consent of Ernst & Young
Sec 302 Chief Executive Officer Certification
Sec 302 Chief Financial Officer Certification
Sec 906 Chief Executive Officer Certification
Sec 906 Chief Financial Officer Certification

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ITEM  1.	BUSINESS

	Subtitle D Regulation. Subtitle D of the Resource Conservation and Recovery Act of 1976, as currently in effect, and similar state regulations have significantly increased the amount of capital, technical expertise, operating costs and financial assurance obligations required to own and operate a

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	landfill and other solid waste facilities. Many of the smaller participants in our industry have found these costs difficult, if not impossible, to bear. Large publicly-owned companies, like our company, have greater access to, and a lower cost of, the capital necessary to finance such increased capital expenditures and costs relative to many of the privately-owned companies in the industry. Additionally, the required permits for landfill development, expansion or construction have become more difficult, time-consuming and costly to acquire. Consequently, many smaller, independent operators have decided to either close their operations or sell them to larger operators that have greater access to capital.
	Integration of Solid Waste Businesses. By being able to control the waste stream in a market through the collection, transfer and disposal process, integrated solid waste companies gain a further competitive advantage over non-integrated operators. The ability of the integrated companies to both collect and dispose of solid waste, coupled with access to significant capital resources necessary for acquisitions, has created an environment in which large publicly-owned, integrated companies can operate more cost effectively and competitively than non-integrated operators.
	Municipal Privatization. The trend toward consolidation in the solid waste services industry is further supported by the increasing tendency of a number of municipalities to privatize their waste disposal operations. Privatization of municipal waste operations is often an attractive alternative to funding the changes required by Subtitle D.

	•	Customer Service. We will continue to reinvest in our existing fleet of vehicles, equipment, landfills and facilities to ensure a high level of service to our customers.
	•	Internal Growth. Growth through increases in our customer base and services provided is the most capital efficient means for us to build our business. This includes not only expanding landfill and transfer capacity and investing in trucks and containers, but also includes investing in information tools and training needed to ensure high productivity and quality service throughout all functional areas of our business.
	•	Strategic Acquisitions. We have and will continue to pursue strategic acquisitions that augment our existing business platform.

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	•	Share Repurchases. If we are unable to identify opportunities that satisfy our growth strategy, we intend to continue to use our free cash flow to repurchase shares of our common stock at prices that provide value to our stockholders. As of December 31, 2004, we had repurchased a total of 35.2 million shares, or approximately 20% of our common stock outstanding at the commencement of our share repurchase program in 2000, for $750.4 million. In October 2004, our board of directors authorized the repurchase of up to an additional $275.0 million of our common stock, of which $274.6 million remained available at December 31, 2004. We believe that our share repurchase program will continue to enhance stockholder value.
	•	Dividends. In July 2003, our board of directors initiated a quarterly cash dividend of $.06 per share. Effective October 2004, our quarterly cash dividend was increased to $.12 per share. We may consider increasing our quarterly cash dividend if we believe it will enhance stockholder value.
	•	Minimize Borrowings. To the extent that the opportunities to enhance stockholder value mentioned above are not available, we also intend to continue to use our free cash flow to minimize our borrowings.

	•	utilize the extensive industry knowledge and experience of our executive management,
	•	utilize a decentralized management structure in overseeing day-to-day operations,
	•	integrate waste operations,
	•	improve operating margins through economies of scale, cost efficiencies and asset utilization,
	•	achieve high levels of customer satisfaction, and
	•	utilize systems to improve consistency in financial and operational performance.

	•	Experienced Executive Management Team. We believe that we have one of the most experienced executive management teams in the solid waste industry.

	James E. O’Connor, who has served as our Chief Executive Officer since December 1998, also became our Chairman in January 2003. He worked at Waste Management, Inc. from 1972 to 1978 and from 1982 to 1998. During that time, he served in various management positions, including Senior Vice President in 1997 and 1998, and Area President of Waste Management of Florida, Inc. from 1992 to 1997. Mr. O’Connor has over 30 years of experience in the solid waste industry.
	Michael J. Cordesman, who has served as our Chief Operating Officer since March 2002 and also as our President since February 2003, has over 24 years of experience in the solid waste industry. He joined us in June 2001 as our Eastern Region Vice President. From 1999 to 2001, Mr. Cordesman served as Vice President of the Central Region for Superior Services Inc. From 1980 to 1999, he served in various positions with Waste Management, including Vice President of the Mid-Atlantic Region from 1992 to 1999.

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	The other corporate officers with responsibility for our operations have an average of over 23 years of management experience in the solid waste industry. Our five regional vice presidents and our 23 area presidents have an average of 24 years of experience in the industry.
	In addition, Harris W. Hudson, who has served as our Vice Chairman since our initial public offering, has over 40 years of experience in the solid waste industry, including 11 years with Waste Management and 19 years with private waste collection companies.

	•	Decentralized Management Structure. We maintain a relatively small corporate headquarters staff, relying on a decentralized management structure to minimize administrative overhead costs and to manage our day-to-day operations more efficiently. Our local management has extensive industry experience in growing, operating and managing solid waste companies and has substantial experience in their local geographic markets. In early 2001, we added a sales, maintenance and operations manager to each of our regional management teams, which previously consisted of a regional vice president and a regional controller. We believe that strengthening our regional management teams allows us to more effectively and efficiently drive our company’s initiatives and helps ensure consistency throughout our organization. Our regional management teams and our area presidents have extensive authority, responsibility and autonomy for operations within their respective geographic markets. Compensation for regional and area management teams is primarily based on the improvement in operating income produced and the free cash flow and return on invested capital generated in each manager’s geographic area of responsibility. In addition, through long-term incentive programs, including stock options, we believe we have one of the lowest turnover levels in the industry for our local management teams. As a result of retaining experienced managers with extensive knowledge of and involvement in their local communities, we are proactive in anticipating our customers’ needs and adjusting to changes in our markets. We also seek to implement the best practices of our various regions and areas throughout our operations to improve operating margins.
	•	Integrated Operations. We seek to achieve a high rate of internalization by controlling waste streams from the point of collection through disposal. We expect that our fully integrated markets generally will have a lower cost of operations and more favorable cash flows than our non-integrated markets. Through acquisitions and other market development activities, we create market-specific, integrated operations typically consisting of one or more collection companies, transfer stations and landfills. We consider acquiring companies that own or operate landfills with significant permitted disposal capacity and appropriate levels of waste volume. We also seek to acquire solid waste collection companies in markets in which we own or operate landfills. In addition, we generate internal growth in our disposal operations by developing new landfills and expanding our existing landfills from time to time in markets in which we have significant collection operations or in markets that we determine lack sufficient disposal capacity. During the three months ended December 31, 2004, approximately 54% of the total volume of waste that we collected was disposed of at landfills we own or operate. In a number of our larger markets, we and our competitors are required to take waste to government-controlled disposal facilities. This provides us with an opportunity to effectively compete in these markets without investing in landfill capacity. Because we do not have landfill facilities or government-controlled disposal facilities for all markets in which we provide collection services, we believe that through landfill and transfer station acquisitions and development we have the opportunity to increase our waste internalization rate and further integrate our operations. By further integrating operations in existing markets through acquisitions and development of landfills and transfer stations, we may be able to reduce our disposal costs.
	•	Economies of Scale, Cost Efficiencies and Asset Utilization. To improve operating margins, our management focuses on achieving economies of scale and cost efficiencies. The consolidation of acquired businesses into existing operations reduces costs by decreasing capital and expenses used for routing, personnel, equipment and vehicle maintenance, inventories and back-office administration. Generally, we consolidate our acquired administrative centers to reduce our general and administrative costs. Our goal is to maintain our selling, general and administrative costs in the range of 10% of revenue, which we feel is appropriate given our existing business platform. In addition, our size allows

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		our company to negotiate volume discounts for certain purchases, including waste disposal rates at landfills operated by third parties. Furthermore, we have taken steps to increase utilization of our assets. For example, to reduce the number of collection vehicles and maximize the efficiency of our fleet, we have instituted a grid productivity program which allows us to benchmark the performance of all of our drivers. In our larger markets, we also use a route optimization program to minimize drive times and improve operating density. By using assets more efficiently, operating expenses can be significantly reduced.
	•	High Levels of Customer Satisfaction. Our goal of maintaining high levels of customer satisfaction complements our operating strategy. Our personalized sales process is oriented towards maintaining relationships and ensuring that service is being properly provided.
	•	Utilize Systems to Improve Consistency in Financial and Operational Reporting. We continue to focus on systems and training initiatives that complement our operating strategy. These initiatives include contact management, billing, productivity, maintenance and general ledger systems. These systems provide us with detailed information, prepared in a consistent manner, that will allow us to quickly analyze and act upon trends in our business.

	•	Internal Growth. Our internal growth strategy focuses on retaining existing customers and obtaining commercial, municipal and industrial customers through our well-managed sales and marketing activities.

	Pricing Activities. We seek to secure price increases necessary to offset increased costs. During the fourth quarter of 2003, we implemented a broad-based pricing initiative across all lines of our business.
	Long-Term Contracts. We seek to obtain long-term contracts for collecting solid waste in high-growth markets. These include exclusive franchise agreements with municipalities as well as commercial and industrial contracts. By obtaining such long-term agreements, we have the opportunity to grow our contracted revenue base at the same rate as the underlying population growth in these markets. For example, we have secured exclusive, long-term franchise agreements in high-growth markets such as Los Angeles, Orange and Contra Costa Counties in California, Las Vegas, Nevada, Arlington, Texas, and many areas of Florida. We believe that this positions our company to experience internal growth rates that are generally higher than our industry’s overall growth rate. In addition, we believe that by securing a base of long-term recurring revenue in growth markets, we are better able to protect our market position from competition and our business may be less susceptible to downturns in economic conditions.
	Sales and Marketing Activities. We seek to manage our sales and marketing activities to enable our company to capitalize on our leading positions in many of the markets in which we operate. We currently have approximately 500 sales and marketing employees in the field, who are compensated using a commission structure that is focused on generating high levels of quality revenue. For the most part, these employees directly solicit business from existing and prospective commercial, industrial, municipal and residential customers. We emphasize our rate and cost structures when we train new and existing sales personnel. In addition, we utilize a contact management system that assists our sales people in tracking leads. It also tracks renewal periods for potential commercial, industrial and franchise contracts.
	Development Activities. We seek to identify opportunities to further our position as an integrated service provider in markets where we provide services for a portion of the waste stream. Where appropriate, we seek to obtain permits to build transfer stations and/or landfills that would provide

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vertically integrated waste services or expand the service area for our existing disposal sites. Development projects, while generally less capital intensive, typically require extensive permitting efforts that can take years to complete with no assurance of success. We undertake development projects when we believe there is a reasonable probability of success and where reasonably priced acquisition opportunities are not available.

	•	Acquisition Growth. During the late 1990’s, the solid waste industry experienced a period of rapid consolidation. We were able to grow significantly through acquisitions during this period. However, the rate of consolidation in the industry has slowed considerably. Despite this, we continue to look to acquire businesses that complement our existing business platform. Our acquisition growth strategy focuses on privately-held solid waste companies and municipal and other local governmental authorities. We believe that our ability to acquire privately-held companies is enhanced by increasing competition in the solid waste industry, increasing capital requirements as a result of changes in solid waste regulatory requirements, and the limited number of exit strategies for these privately-held companies’ owners and principals. We also seek to acquire operations and facilities from municipalities that are privatizing, which occur for many of the same reasons that privately-held companies sell their solid waste businesses. In addition, we will continue to evaluate opportunities to acquire operations and facilities that may be divested by other publicly-owned waste companies. In sum, our acquisition growth strategy focuses on:

	•	acquiring businesses that position our company for growth in existing and new markets,
	•	acquiring well-managed companies and, when appropriate, retaining local management,
	•	acquiring operations and facilities from municipalities that are privatizing and publicly-owned companies that are divesting of assets.

	For certain risks involved with our acquisition growth strategy, see “Risk Factors — We may be unable to execute our acquisition growth strategy,” “— We may be unable to manage our growth effectively,” and “— Businesses we acquire may have undisclosed liabilities.”
	Acquire Businesses Positioning the Company for Growth. In making acquisitions, we principally target high quality businesses that will allow our company to be, or provide our company favorable prospects of becoming, a leading provider of integrated solid waste services in markets with favorable demographic growth. Generally, we have acquired, and will continue to seek to acquire, solid waste collection, transfer and disposal companies that:

	•	have strong operating margins,
	•	are in growth markets,
	•	are among the largest or have a significant presence in their local markets, and
	•	have long-term contracts or franchises with municipalities and other customers.

Once we have a base of operations in a particular market, we focus on acquiring trucks and routes of smaller businesses that also operate in that market and surrounding markets, which are typically referred to as “tuck-in” acquisitions. We seek to consolidate the operations of such tuck-in businesses into our existing operations in that market. We also seek to acquire landfills, transfer stations and collection companies that operate in markets that we are already servicing in order to fully integrate our operations from collection to disposal. In addition, we have in the past and may continue in the future to exchange businesses with other solid waste companies if by doing so there is a net benefit to our business platform. These activities allow us to increase our revenue and market share, lower our cost of operations as a percentage of revenue, and consolidate duplicative facilities and functions to maximize cost efficiencies and economies of scale.

	Acquire Well-Managed Companies. We also seek to acquire businesses that have experienced management teams that are willing to join the management of our company. We generally seek to maintain continuity in management of larger acquired companies in order to capitalize on their local

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	market knowledge, community relations and name recognition, and to instill their entrepreneurial drive at all levels of our operations. By furnishing the local management of such acquired companies with our financial and marketing resources and technical expertise, we believe that the acquired companies are better able to secure additional municipal franchises and other contracts.
	Privatize Municipal Operations and Acquire Divested Operations. We also seek to acquire solid waste collection operations, transfer stations and landfills that municipalities and other governmental authorities are privatizing. Many municipalities are seeking to outsource or sell these types of solid waste operations, as they lack the capital, technical expertise and/or operational resources necessary to comply with increasingly stringent regulatory standards and/or to compete effectively with private-sector companies. In addition, we have acquired, and will continue to seek to acquire, operations and facilities that may be divested by other publicly-owned waste companies.

	•	market factors,
	•	collection frequency,
	•	type of equipment furnished,
	•	the type and volume or weight of the waste collected,
	•	the distance to the disposal facility and
	•	the cost of disposal.

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	(1) The Solid Waste Disposal Act, as amended, including the Resource Conservation and Recovery Act. RCRA and its implementing regulations establish a framework for regulating the handling,

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	transportation, treatment, storage and disposal of hazardous and non-hazardous solid waste, and require states to develop programs to ensure the safe disposal of solid waste in sanitary landfills.
	Subtitle D of RCRA establishes a framework for regulating the disposal of municipal solid waste. Regulations under Subtitle D currently include minimum comprehensive solid waste management criteria and guidelines, including location restrictions, facility design and operating criteria, closure and post-closure requirements, financial assurance standards, groundwater monitoring requirements and corrective action standards, many of which had not commonly been in effect or enforced in the past in connection with municipal solid waste landfills. Each state was required to submit to the U.S. EPA a permit program designed to implement Subtitle D regulations by April 9, 1993. All of the states in which we operate have implemented permit programs pursuant to RCRA and Subtitle D. These state permit programs may include landfill requirements which are more stringent than those of Subtitle D.
	All of our planned landfill expansions or new landfill development projects have been engineered to meet or exceed Subtitle D requirements. Operating and design criteria for existing operations have been modified to comply with these new regulations. Compliance with Subtitle D regulations has resulted in increased costs and may in the future require substantial additional expenditures in addition to other costs normally associated with our waste management activities.
	(2) The Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended. CERCLA, among other things, provides for the cleanup of sites from which there is a release or threatened release of a hazardous substance into the environment. CERCLA may impose strict joint and several liability for the costs of cleanup and for damages to natural resources upon current owners and operators of the site, parties who were owners or operators of the site at the time the hazardous substances were disposed of, parties who transported the hazardous substances to the site and parties who arranged for the disposal of the hazardous substances at the site. Under the authority of CERCLA and its implementing regulations, detailed requirements apply to the manner and degree of investigation and remediation of facilities and sites where hazardous substances have been or are threatened to be released into the environment. Liability under CERCLA is not dependent upon the existence or disposal of only “hazardous wastes” but can also be based upon the existence of small quantities of more than 700 “substances” characterized by the U.S. EPA as “hazardous,” many of which may be found in common household waste.
	Among other things, CERCLA authorizes the federal government to investigate and remediate sites at which hazardous substances have been or are threatened to be released into the environment or to order (or offer an opportunity to) persons potentially liable for the cleanup of the hazardous substances to do so. In addition, the U.S. EPA has established a National Priorities List of sites at which hazardous substances have been or are threatened to be released and which require investigation or cleanup.
	Liability under CERCLA is not dependent upon the intentional disposal of hazardous waste or hazardous substances. It can be founded upon the release or threatened release, even as a result of unintentional, non-negligent or lawful action, of thousands of hazardous substances, including very small quantities of such substances. Thus, even if our landfills have never knowingly received hazardous waste as such, it is possible that one or more hazardous substances may have been deposited or “released” at our landfills or at other properties which we currently own or operate or may have owned or operated. Therefore, we could be liable under CERCLA for the cost of cleaning up such hazardous substances at such sites and for damages to natural resources, even if those substances were deposited at our facilities before we acquired or operated them. The costs of a CERCLA cleanup can be very expensive. Given the difficulty of obtaining insurance for environmental impairment liability, such liability could have a material impact on our business and financial condition. For a further discussion, see “— Liability Insurance and Bonding.”
	(3) The Federal Water Pollution Control Act of 1972, as amended. This Act regulates the discharge of pollutants from a variety of sources, including solid waste disposal sites, into streams, rivers and other waters of the United States. Point source runoff from our landfills and transfer stations that is discharged into surface waters must be covered by discharge permits that generally require us to conduct

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	sampling and monitoring, and under certain circumstances, reduce the quantity of pollutants in those discharges. Storm water discharge regulations under this Act require a permit for certain construction activities and discharges from industrial operations and facilities, which may affect our operations. If a landfill or transfer station discharges wastewater through a sewage system to a publicly-owned treatment works, the facility must comply with discharge limits imposed by that treatment works. In addition, states may adopt groundwater protection programs under this Act or the Safe Drinking Water Act that could affect solid waste landfills. Furthermore, development which alters or affects wetlands must generally be permitted prior to such development commencing, and certain mitigation requirements may be required by the permitting agencies.
	(4) The Clean Air Act, as amended. The Clean Air Act imposes limitations on emissions from various sources, including landfills. In March 1996, the U.S. EPA promulgated regulations that require large municipal solid waste landfills to install landfill gas monitoring systems. These regulations apply to landfills that commenced construction, reconstruction or modification on or after May 30, 1991, and, principally, to landfills that can accommodate 2.5 million cubic meters or more of municipal solid waste. The regulations apply whether the landfill is active or closed. The date by which each affected landfill is required to have a gas collection and control system installed and made operational varies depending upon calculated emission rates at the landfill. Many state regulatory agencies also currently require monitoring systems for the collection and control of certain landfill gas. We do not expect that compliance with any new state regulations will have a material effect on us.
	(5) The Occupational Safety and Health Act of 1970, as amended. This Act authorizes the Occupational Safety and Health Administration of the U.S. Department of Labor to promulgate occupational safety and health standards. A number of these standards, including standards for notices of hazardous chemicals and the handling of asbestos, apply to our facilities and operations.

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	•	desirable acquisition candidates exist or will be identified,
	•	we will be able to acquire any of the candidates identified,
	•	we will effectively consolidate companies which are acquired and fully or timely realize the expected cost savings, economies of scale or business efficiencies, or
	•	any acquisitions will be profitable or accretive to our earnings.

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ITEM 2.	PROPERTIES

																	Unused
									Total				Permitted				Permitted
Landfill Name			Location				Region		Acreage(2)				Acreage(3)				Acreage(4)
545 Landfill				Winter Garden, Florida			Southern			80				58				3
623 Landfill				Richmond, Virginia			Eastern			184				138				84
Apex				Clark County, Nevada			Western			2,285				1,233				1,018
Brent Run				Montrose, Michigan			Central			544				106				43
Broadhurst Landfill				Jesup, Georgia			Southern			1,400				105				49
Carleton Farms				Detroit, Michigan			Central			640				388				192
Cedar Trail				Bartow, Florida			Southern			392				68				68
Charter Waste				Abilene, Texas			Southwestern			396				300				264
Chiquita Canyon				Valencia, California			Western			592				257				45
Countywide				East Sparta, Ohio			Eastern			815				258				170
Dozit Landfill				Morganfield, Kentucky			Central			231				47				23
East Carolina Landfill				Aulander, North Carolina			Southern			740				113				42
Elk Run				Onaway, Michigan			Central			99				40				25
Epperson Landfill				Williamstown, Kentucky			Central			899				100				31
Foothills Landfill(1)				Lenior, North Carolina			Southern			258				78				50
Forest Lawn				Three Oaks, Michigan			Central			281				165				9
Front Range				Denver, Colorado			Southwestern			602				195				133
Greenville				Greenville, South Carolina			Southern			21				7				4
Highway 78				Oconee, Georgia			Southern			379				118				108
Honeygo Run				Perry Hall, Maryland			Eastern			68				39				5
Kestrel Hawk				Racine, Wisconsin			Central			218				138				20
Laughlin(1)				Laughlin, Nevada			Western			40				40				—
Mallard Ridge				Delavan, Wisconsin			Central			746				42				2
Modern				York, Pennsylvania			Eastern			739				230				22
National Serv-All				Fort Wayne, Indiana			Central			587				204				—
Nine Mile Road				St. Augustine, Florida			Southern			354				57				25
North County				Houston, Texas			Southwestern			100				31				2
Northwest Tennessee				Union City, Tennessee			Central			600				120				72
Oak Grove				Winder, Georgia			Southern			329				72				—
Ohio County Balefill(1)				Beaver Dam, Kentucky			Central			908				178				121
Pepperhill				North Charleston, South Carolina			Southern			37				26				—
Pine Grove				Amanda, Ohio			Eastern			734				112				65
Pine Ridge				Griffin, Georgia			Southern			515				196				130
Potrero				Suisan, California			Western			1,423				190				68
Presidio(1)				Presidio, Texas			Southwestern			10				10				6
Republic/ Alpine(1)				Alpine, Texas			Southwestern			80				74				67
Republic/ CSC				Avalon, Texas			Southwestern			517				190				116
Republic/ Maloy				Campbell, Texas			Southwestern			455				195				110
San Angelo(1)				San Angelo, Texas			Southwestern			257				236				138
Savannah Regional				Savannah, Georgia			Southern			129				56				34
Seabreeze Landfill				Clute, Texas			Southwestern			896				386				240
Seagull				Avalon, California			Western			6				3				—
Southern Illinois Regional				DeSoto, Illinois			Central			351				238				143
Spring Grove				Charleston, South Carolina			Southern			246				174				139
Swiftcreek Landfill				Macon, Georgia			Southern			836				85				12
Tay-Ban				Birch Run, Michigan			Central			87				43				9
Tri-K Landfill				Stanford, Kentucky			Central			612				190				150
Union County				Cross Anchor, South Carolina			Southern			600				83				67
United Refuse				Fort Wayne, Indiana			Central			305				77				15
Upper Piedmont Environmental				Roxboro, North Carolina			Southern			860				70				29
Uwharrie Landfill(1)				Mt. Gilead, North Carolina			Southern			466				118				45
Valley View Landfill				Sulphur, Kentucky			Central			894				199				93
Vasco Road				Livermore, California			Western			548				246				68
Victory Environmental				Terre Haute, Indiana			Central			1,013				303				133
Wabash Valley				Wabash, Indiana			Central			390				137				60
West Contra Costa County				Contra Costa, California			Western			350				188				—
Whitefeather				Pinconning, Michigan			Central			639				57				26
Worthington				Worthington, Indiana			Central			420				97				28
	Total									29,203				8,904				4,621

(1)	Operated but not owned by us.
(2)	Total acreage includes permitted acreage, probable expansion acreage, other acreage available for future disposal that has not been permitted, buffer land and other contiguous land owned by our company.
(3)	Permitted acreage consists of all acreage at the landfill encompassed by an active permit to dispose of waste.
(4)	Unused permitted acreage consists of all acreage at the landfill encompassed by an active permit on which disposal operations have not commenced.

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ITEM 3.	LEGAL PROCEEDINGS

ITEM 4.	SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

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ITEM 5.	MARKET FOR THE REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

										Dividends
		High				Low				Declared
2004
First Quarter		$	27.43			$	24.50			$	.06
Second Quarter			30.27				27.05				.06
Third Quarter			30.10				26.50				.12
Fourth Quarter			33.98				28.95				.12
2003
First Quarter		$	21.29			$	18.25			$	—
Second Quarter			24.41				19.50				—
Third Quarter			24.75				21.77				.06
Fourth Quarter			26.09				22.15				.06

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															(d)
															Maximum Number
											(c)				(or Approximate
											Total Number of				Dollar Value) of
			(a)								Shares (or Units)				Shares (or Units)
			Total Number				(b)				Purchased as Part				that May Yet Be
			of Shares				Average Price				of Publicly				Purchased Under the
			(or Units)				Paid per Share				Announced Plans				Plans or Programs
Period			Purchased*				(or Unit)				or Programs				(in millions)
Month #1 (October 1, — October 31, 2004)				95,105			$	29.34				65,300			$	296.0
Month #2 (November 1, — November 30, 2004)				504,900				31.23				504,900				280.2
Month #3 (December 1, — December 31, 2004)				170,200				33.27				170,200				274.6
	Total			770,205			$	31.45				740,400			$	274.6

*	Includes 29,805 shares purchased in the open market in connection with our 401(k) and deferred compensation programs.

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ITEM 6.	SELECTED FINANCIAL DATA (in millions, except per share data)

			Years Ended December 31,
			2004				2003				2002				2001				2000
Statement of Income Data:
Revenue			$	2,708.1			$	2,517.8			$	2,365.1			$	2,257.5			$	2,103.3
Expenses:
	Cost of operations			1,714.4				1,605.4				1,472.9				1,422.5				1,271.3
	Depreciation, amortization and depletion			259.4				239.1				199.6				215.4				197.4
	Accretion			13.7				12.7				—				—				—
	Selling, general and administrative			268.3				247.9				238.7				236.5				193.9
	Other charges (income)			—				—				(5.6	)			99.6				6.7
Operating income				452.3				412.7				459.5				283.5				434.0
Interest expense				(76.7	)			(78.0	)			(77.0	)			(80.1	)			(81.6	)
Interest income				6.9				9.5				4.3				4.4				1.7
Other income (expense), net				1.2				3.2				(.3	)			1.5				2.3
Income before income taxes				383.7				347.4				386.5				209.3				356.4
Provision for income taxes				145.8				132.0				146.9				83.8				135.4
Income before cumulative effect of changes in accounting principles				237.9				215.4				239.6				125.5				221.0
Cumulative effect of changes in accounting principles				—				(37.8	)			—				—				—
Net income			$	237.9			$	177.6			$	239.6			$	125.5			$	221.0
Basic earnings per share:
	Before cumulative effect of changes in accounting principles		$	1.56			$	1.34			$	1.45			$	.74			$	1.26
	Cumulative effect of changes in accounting principles			—				(.23	)			—				—				—
	Basic earnings per share		$	1.56			$	1.11			$	1.45			$	.74			$	1.26
	Weighted average common shares outstanding			152.8				160.3				165.4				170.1				175.0
Diluted earnings per share:
	Before cumulative effect of changes in accounting principles		$	1.53			$	1.33			$	1.44			$	.73			$	1.26
	Cumulative effect of changes in accounting principles			—				(.23	)			—				—				—
	Diluted earnings per share		$	1.53			$	1.10			$	1.44			$	.73			$	1.26
	Weighted average common and common equivalent shares outstanding			155.3				162.1				166.7				171.1				175.0
Cash dividends per common share			$	.36			$	.12			$	—			$	—			$	—

		Years Ended December 31,
		2004				2003				2002				2001				2000
Other Operating Data:
Cash flows from operating activities		$	666.3			$	600.5			$	569.7			$	459.2			$	461.8
Capital expenditures(a)			283.8				273.2				258.6				249.3				208.0
Proceeds from the sale of property and equipment			5.7				9.1				14.6				8.7				12.6

		As of December 31,
		2004				2003				2002				2001				2000
Balance Sheet Data:
Cash and cash equivalents		$	141.5			$	119.2			$	141.5			$	16.1			$	2.0
Restricted cash and marketable securities			275.7				397.4				175.0				142.3				84.3
Total assets			4,464.6				4,554.1				4,209.1				3,856.3				3,561.5
Total debt			1,354.3				1,520.3				1,442.1				1,367.7				1,256.7
Total stockholders’ equity			1,872.5				1,904.5				1,881.1				1,755.9				1,674.9

(a)	During 2002, we also paid $72.6 million to purchase equipment originally placed into service pursuant to an operating lease.

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ITEM 7.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

				Years Ended December 31,
				2004								2003								2002
Collection:
	Residential			$	655.2				24.2	%		$	601.2				23.9	%		$	530.7				22.4	%
	Commercial				737.9				27.2				706.0				28.0				696.7				29.5
	Industrial				558.1				20.6				523.0				20.8				501.6				21.2
	Other				62.2				2.3				50.9				2.0				50.8				2.1
		Total collection			2,013.4				74.3				1,881.1				74.7				1,779.8				75.2
Transfer and disposal					1,031.0								967.5								854.1
Less: Intercompany					(519.8	)							(493.7	)							(428.5	)
Transfer and disposal, net					511.2				18.9				473.8				18.8				425.6				18.0
Other					183.5				6.8				162.9				6.5				159.7				6.8
		Revenue		$	2,708.1				100.0	%		$	2,517.8				100.0	%		$	2,365.1				100.0	%

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	•	Generating free cash flow of approximately $340 million.
	•	Using our free cash flow to repurchase shares of our common stock under our $200.0 million share repurchase program approved by our board of directors in October 2003 and continuing to pay quarterly cash dividends.
	•	Generating diluted earnings per share of $1.50 to $1.55.
	•	Growing revenue from core operations by 3%, with approximately 2% attributable to price increases and 1% attributable to volume growth.
	•	Purchasing approximately $275 million of property and equipment.

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	•	We expect to generate free cash flow in excess of $260 million.
	•	We anticipate using our free cash flow to continue to repurchase shares of our common stock under our $275.0 million share repurchase program approved by our board of directors in October 2004 and to continue to pay quarterly cash dividends.
	•	We anticipate diluted earnings per share of $1.65 to $1.70.
	•	We are targeting internal growth from core operations to be in the range of 4.0% to 4.5%, with 2.5% attributable to price increases and 1.5% to 2.0% attributable to volume growth.
	•	We anticipate purchasing approximately $300 million of property and equipment.

	•	Pricing initiatives. During the fourth quarter of 2003, we implemented a broad-based pricing initiative across all lines of our business. The purpose of this initiative is to recover increasing costs and improve operating margins. We realized the benefit of this initiative during 2004 and expect a similar benefit during 2005.
	•	Improve the quality of our revenue. The first step in this process was completed in 2001 and included installing a standardized billing and operating system. This system enables us to, among other things, stratify our customers to determine how our rates compare to current market pricing. During 2002, we implemented the second generation of this software which we call RSI 1.0. RSI 1.0, our company’s core business system, provides a variety of functionalities including customer service, dispatch, billing, sales analysis, account retention and route productivity analysis. During 2005, we will begin to develop the next generation of our billing and operating system. This system will provide additional functionality to our operating locations and further standardize our billing and operating processes.

	We currently monitor our return on investment by market place and have instituted a return on investment pricing model. This model will eventually allow us to track our return on investment by customer.

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During 2001, we also implemented a customer relationship management system. This system improves the productivity of our sales force by helping to establish marketing priorities and track sales leads. It also tracks renewal periods for potential commercial, industrial and franchise contracts. During 2005, we will continue to ensure our sales force is properly trained on this system and is using it as intended.

	•	Improve the productivity of our operations. We use a grid productivity program that enables us to benchmark the performance of our drivers. In addition, in our larger markets, we use a route optimization program to minimize drive times and improve operational density. During 2005, we will continue to update our disposal optimization metrics. These metrics identify which local disposal option maximizes our return on invested capital and cash flow.
	•	Improve fleet management and procurement. In February 2002, we selected Dossier as our fleet management and parts procurement system. During 2003, we implemented Dossier at all of our significant hauling and landfill operations. Among other features, this system tracks parts inventories, generates automatic quantity order points and logs all maintenance work. It allows us to capture and review information to ensure our preventive maintenance programs comply with manufacturers’ warranties and governmental regulations. In addition, the purchase order module within this system allows us to cross-reference purchasing information with our inventory. During 2005, we intend to further utilize this purchase order module to take advantage of volume discounts.
	•	Enhance operational and financial reporting systems. We have several initiatives aimed at improving our operational and financial reporting systems. The overall goal of these initiatives is to provide us with detailed information, prepared in a consistent manner, that will allow us to quickly analyze and act upon trends in our business.

	One of our most significant systems is our enterprise-wide general ledger package. We successfully converted all of our locations to Lawson general ledger software in 2002 and in 2003 successfully converted all of our locations to Lawson fixed asset software.
	All of the system initiatives mentioned above will provide us with more consistent and detailed information, thus allowing us to make quicker and more informed business decisions. In addition, during 2001, all of our significant software applications were standardized and centralized at our data center in Fort Lauderdale, Florida. This standardization and centralization provides us with consolidated information concerning our operations across a variety of operational and financial disciplines. It also significantly enhances our ability to execute our disaster recovery plan, if necessary.

	•	Expand our safety training programs. As part of our ongoing emphasis on safe work practices and in light of increasing insurance costs, we expanded our safety training programs in 2002. During 2004, we distributed to all of our locations a comprehensive training and safety manual. Safety will continue to be a key area of focus during 2005.
	•	Develop and implement performance strategies. Develop and implement strategies to improve the performance of locations and lines of business that are performing below the company’s average.

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				Subjective or		Disclosure
Policy		Description		Complex Judgments		Reference
Landfill Accounting:
Life Cycle Accounting		We use life cycle accounting and the units-of-consumption method to recognize certain landfill costs over the life of the site. In life cycle accounting, all costs to acquire and construct a site are capitalized, and charged to expense based upon the consumption of cubic yards of available airspace. Obligations associated with final capping, closure and post-closure are capitalized, and amortized on a units- of-consumption basis as airspace is consumed.		Cost and airspace estimates are developed annually by engineers. Changes in these estimates could significantly affect our amortization, depletion, and accretion expense.		Management’s Discussion and Analysis of Financial Condition and Results of Operations — Landfill and Environmental Matters. Note 3, Accrued Landfill and Environmental Costs in the Consolidated Financial Statements.
Probable Expansion Airspace		We include in our calculation of total available airspace expansion areas that we believe have a probable likelihood that the expansion area will ultimately be permitted.		We have developed six criteria that must be met before an expansion area is designated as probable expansion airspace. We believe that satisfying each of these criteria demonstrates a high likelihood that expansion airspace that is incorporated in our landfill costing will be permitted. However, because some of these criteria are judgmental, they may exclude expansion airspace that will eventually be permitted or include expansion airspace that will not be permitted. In either of these scenarios, our amortization, depletion, and accretion expense could change significantly.		Management’s Discussion and Analysis of Financial Condition and Results of Operations — Landfill and Environmental Matters. Note 3, Accrued Landfill and Environmental Costs in the Consolidated Financial Statements.

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				Subjective or		Disclosure
Policy		Description		Complex Judgments		Reference
Final Capping, Closure and Post-Closure		Prior to January 1, 2003, costs for final closure of our landfills and costs for providing required post-closure monitoring and maintenance were charged to cost of operations based upon consumed airspace using the units-of- consumption method. These costs were not inflated or discounted to the present value of total estimated costs. On January 1, 2003, we adopted Statement of Financial Accounting Standards No. 143, “Accounting for Asset Retirement Obligations.” Under SFAS 143, obligations associated with final capping activities that occur during the operating life of the landfill are recognized on a units-of- consumption basis as airspace is consumed within each discrete capping event. Obligations related to closure and post- closure activities that occur after the landfill has ceased operations are recognized on a units-of-consumption basis as airspace is consumed throughout the entire landfill life. Landfill retirement obligations are capitalized as the related liabilities are recognized and amortized using the units-of-consumption method over the airspace consumed within the capping event or the airspace consumed throughout the entire landfill, depending upon the nature of the obligation. All obligations are initially measured at estimated fair value. Fair value is calculated on a present value basis using an inflation rate and the company’s credit-adjusted, risk-free rate.		Total future costs for capping, closure and post- closure are developed annually by engineers. Changes in these estimates could affect our amortization of final capping, closure and post- closure costs and our accretion expense.		Management’s Discussion and Analysis of Financial Condition and Results of Operations — Landfill and Environmental Matters and — Selected Balance Sheet Accounts. Note 3, Accrued Landfill and Environmental Costs in the Consolidated Financial Statements.

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				Subjective or		Disclosure
Policy		Description		Complex Judgments		Reference
Self-Insurance:
		Our insurance programs for worker’s compensation, general liability, vehicle liability and employee-related health care benefits are effectively self-insured. Self-insurance accruals are based on claims reported and actuarial estimates of claims development and claims incurred but not reported.		Estimates of claims development and claims incurred but not reported are developed actuarially. If actual claims experience or development is significantly different than our estimates, our self- insurance expense would change.		Management’s Discussion and Analysis of Financial Condition and Results of Operations — Selected Balance Sheet Accounts. Note 12, Commitments and Contingencies in the Consolidated Financial Statements.
Property and Equipment:
Expenditures for Improvements, Repairs and Maintenance		Expenditures for major additions and improvements to facilities are capitalized. All expenditures for maintenance and repairs are expensed when incurred.		Whether certain expenditures improve an asset or lengthen its useful life is subject to our judgment. Accordingly, the actual useful lives of our assets could differ from our estimates.		Management’s Discussion and Analysis of Financial Condition and Results of Operations — Property and Equipment. Note 2, Summary of Significant Accounting Policies in the Consolidated Financial Statements.
Useful Lives		Property and equipment are recorded at cost. Depreciation and amortization expense are provided over the estimated useful lives of the applicable assets using the straight-line method. The estimated useful lives are seven to forty years for buildings and improvements, five to twelve years for vehicles, seven to ten years for most landfill equipment, three to fifteen years for all other equipment, and five to twelve years for furniture and fixtures.		Our estimates regarding the useful lives of our depreciable assets are based on our judgment. Accordingly, actual useful lives could differ from our estimates.		Management’s Discussion and Analysis of Financial Condition and Results of Operations — Property and Equipment. Note 2, Summary of Significant Accounting Policies in the Consolidated Financial Statements.

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				Subjective or		Disclosure
Policy		Description		Complex Judgments		Reference
Capitalized Interest		We capitalize interest on landfill cell construction and other construction projects in accordance with Statement of Financial Accounting Standards No. 34, “Capitalization of Interest Cost.”		Capitalizing too little or too much interest expense could lead to a misstatement of interest expense in the statement of income. In order to minimize this risk, construction projects must meet the following criteria before interest is capitalized: 1. Total construction costs are $50,000 or greater, 2. the construction phase is one month or longer, and 3. the assets have a useful life of one year or longer.		Management’s Discussion and Analysis of Financial Condition and Results of Operations — Property and Equipment. Note 2, Summary of Significant Accounting Policies in the Consolidated Financial Statements.
Revenue and Accounts Receivable:
		Revenue consists primarily of collection fees from various customer types and transfer and landfill disposal fees charged to third parties. Advance billings are recorded as deferred revenue. Revenue is recognized over the period in which services are provided. No one customer has individually accounted for more than 10% of our consolidated revenue or of our reportable segment revenue in any of the past three years. Reserves for accounts receivable are provided when a receivable is believed to be uncollectible or generally when a receivable is in excess of 90 days old.		Establishing reserves against specific accounts receivable and the overall adequacy of our accounts receivable reserve is a matter of judgment. If our judgment and estimates concerning the adequacy of our reserve for accounts receivable is incorrect, bad debt expense would change.		Management’s Discussion and Analysis of Financial Condition and Results of Operations — Selected Balance Sheet Accounts. Note 2, Summary of Significant Accounting Policies in the Consolidated Financial Statements.

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				Subjective or		Disclosure
Policy		Description		Complex Judgments		Reference
Derivatives:
		From time to time, we use derivatives to limit our exposure to fluctuations in interest rates and diesel fuel prices. These derivatives have been accounted for in accordance with Statement of Financial Accounting Standards No. 133, “Accounting for Derivative Instruments and Hedging Activities.”		The hedging relationships we have entered into are expected to be either 100% effective or highly effective and have been determined to meet the criteria for hedge accounting. If, in the future, these relationships are no longer expected to be 100% or highly effective, or if they no longer meet the criteria for hedge accounting, our results of operations could change.		Management’s Discussion and Analysis of Financial Condition and Results of Operations — Financial Condition and — Fuel Hedge. Note 5, Debt, and Note 11, Fuel Hedge in the Consolidated Financial Statements.

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				Subjective or		Disclosure
Policy		Description		Complex Judgments		Reference
Long-Lived Asset Impairments:
		Long-lived assets consist primarily of property, equipment, goodwill and other intangible assets. We periodically evaluate whether events and circumstances have occurred (as further described in Note 2 of the Consolidated Financial Statements) that may warrant revision of the estimated useful life of long-lived assets or whether the remaining balance of these assets should be evaluated for possible impairment. We use an estimate of the undiscounted cash flows over the remaining life of the assets in assessing their recoverability. In addition, goodwill is tested for impairment on an annual basis or more frequently if indicators of impairment arise. In testing for impairment, we estimate the fair value of each operating segment of our business and compare the fair values with the carrying values. If the fair value of an operating segment is greater than its carrying value, no impairment results. We measure impairment loss as the amount by which the carrying amount of the asset or operating segment exceeds its fair value.		Our estimates of future cash flows and fair values are based on our judgment. Accordingly, we could designate certain assets as impaired that are not and fail to identify certain impaired assets.		Management’s Discussion and Analysis of Financial Condition and Results of Operations — Property and Equipment. Note 2, Summary of Significant Accounting Policies, and Note 4, Business Combinations in the Consolidated Financial Statements.

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				Subjective or		Disclosure
Policy		Description		Complex Judgments		Reference
Income Taxes:
		We account for income taxes in accordance with Statement of Financial Accounting Standards No. 109, “Accounting for Income Taxes.” Accordingly, deferred taxes have been provided to show the effect of temporary differences between the recognition of revenue and expenses for financial and income tax reporting purposes and between the tax basis of assets and liabilities and their reported amounts in the financial statements. After the initial recognition of a deferred tax asset, a valuation allowance is provided if it is determined that it is more likely than not that the asset will not be realized.		Valuation allowances for deferred tax assets and the realizability of net operating losses for tax purposes are based upon our judgment. If our judgment and estimates concerning valuation allowances and the realizability of net operating losses are incorrect, our provision for income taxes would change.		Note 2, Summary of Significant Accounting Policies, and Note 6, Income Taxes in the Consolidated Financial Statements.

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	Years Ended December 31, 2004, 2003 and 2002

			2004								2003								2002
			$				%				$				%				$				%
Revenue			$	2,708.1				100.0	%		$	2,517.8				100.0	%		$	2,365.1				100.0	%
Cost of operations				1,714.4				63.3				1,605.4				63.8				1,472.9				62.3
Depreciation, amortization and depletion of property and equipment				252.4				9.3				233.8				9.3				193.5				8.2
Amortization of intangible assets				7.0				.3				5.3				.2				6.1				.2
Accretion				13.7				.5				12.7				.5				—				—
Selling, general and administrative expenses				268.3				9.9				247.9				9.8				238.7				10.1
Other charges (income)				—				—				—				—				(5.6	)			(.2	)
	Operating income		$	452.3				16.7	%		$	412.7				16.4	%		$	459.5				19.4	%

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			2004				2003				2002
Core price				2.3	%			1.8	%			1.4	%
Fuel surcharges				.2				.2				—
Recycling commodities				.5				.1				.4
	Total price			3.0				2.1				1.8
Core volume				3.6				2.1				1.6
Non-core volume				.1				—				.4
	Total volume			3.7				2.1				2.0
	Total internal growth			6.7				4.2				3.8
Acquisitions				.9				1.8				.8
Taxes(a)				—				.5				.2
	Total revenue growth			7.6	%			6.5	%			4.8	%

(a)	Represents new taxes levied on landfill volumes in certain states that are passed on to customers.

	•	2004: During the year ended December 31, 2004, our revenue growth from core pricing benefited from a broad-based pricing initiative which we started during the fourth quarter of 2003. During the year ended December 31, 2004, we experienced core volume growth in all lines of our business, including our residential collection business resulting from the addition of several new municipal contracts, and our landfill and transfer station businesses resulting from newly opened sites and new contracts. Our internal growth from our core operations was 5.9% in 2004.

	•	2003: During the first three quarters of 2003, we experienced moderate growth in revenue due to an increase in core pricing. During the fourth quarter of 2003, our revenue growth from core pricing increased at a more rapid pace due to our broad-based pricing initiative.

	During 2003, the economic slowdown which began during 2001 continued to negatively impact our business. However, during 2003, our revenue growth from core volume continued to be positively impacted by long-term franchise and municipal contracts that were secured during 2002. Our internal growth from core operations was 3.9% in 2003.

	•	2002: The economic slowdown which began in 2001 continued to negatively impact the portion of our business servicing the manufacturing sector and non-residential construction industry during 2002. Volumes attributable to manufacturing and construction activity continued to weaken during 2002.

	The weakness in our business attributable to the economic slowdown was partially offset by an increase in recycling commodity prices in the early part of 2002.
	Despite the weakness we experienced in the aspects of our business noted above, our internal growth from core operations for 2002 was 3.0%. During 2002, we secured several long-term franchise and municipal contracts. We also benefited from the geographic mix of our business which favors high- growth markets.

	•	2005 Outlook: We anticipate internal growth from core operations to be in the range of 4.0% to 4.5% during 2005 assuming no deterioration or improvement in the overall economy from that experienced during the fourth quarter of 2004. However, our price and volume growth may remain flat or may decline in 2005 depending upon economic conditions and our success in implementing pricing initiatives.

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	Available Airspace

			Balance as of				New				Landfills				Permits								Changes in				Changes				Balance as of
			December 31,				Expansions				Acquired, Net				Granted, Net				Airspace				Engineering				in				December 31,
			2001				Undertaken				of Divestitures				of Closures				Consumed				Estimates				Design				2002
Permitted airspace:
	Cubic yards (in millions)			1,329.0				—				4.9				45.1				(34.6	)			13.1				.4				1,357.9
	Number of sites			54								1				1																56
Expansion airspace:
	Cubic yards (in millions)			359.6				4.3				—				(35.7	)			—				(2.1	)			27.2				353.3
	Number of sites			20				2				—				(2	)															20
Total available airspace:
	Cubic yards (in millions)			1,688.6				4.3				4.9				9.4				(34.6	)			11.0				27.6				1,711.2
Number of sites				54								1				1																56

			Balance as of				New				Landfills				Permits								Changes in				Changes				Balance as of
			December 31,				Expansions				Acquired, Net				Granted, Net				Airspace				Engineering				In				December 31,
			2002				Undertaken				of Divestitures				of Closures				Consumed				Estimates				Design				2003
Permitted airspace:
	Cubic yards (in millions)			1,357.9				—				26.3				154.6				(39.3	)			(.9	)			—				1,498.6
	Number of sites			56								2				—																58
Expansion airspace:
	Cubic yards (in millions)			353.3				61.6				—				(154.1	)			—				(3.5	)			11.4				268.7
	Number of sites			20				—				—				(5	)															15
Total available airspace:
	Cubic yards (in millions)			1,711.2				61.6				26.3				.5				(39.3	)			(4.4	)			11.4				1,767.3
Number of sites				56								2				—																58

			Balance as of				Landfills				Permits								Changes in				Changes				Balance as of
			December 31,				Acquired, Net				Granted, Net				Airspace				Engineering				In				December 31,
			2003				of Divestitures				of Closures				Consumed				Estimates				Design				2004
Permitted airspace:
	Cubic yards (in millions)			1,498.6				24.4				48.6				(42.1	)			.1				—				1,529.6
	Number of sites			58				1				(1	)															58
Expansion airspace:
	Cubic yards (in millions)			268.7				—				(48.6	)			—				.1				2.0				222.2
	Number of sites			15				—				(3	)															12
Total available airspace:
	Cubic yards (in millions)			1,767.3				24.4				—				(42.1	)			.2				2.0				1,751.8
Number of sites				58				1				(1	)															58

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		Number of Sites without				Number of Sites with				Total				Percent
		Expansion Airspace				Expansion Airspace				Sites				of Total
0 to 5 years			6				1				7				12	%
5+ to 10 years			6				0				6				11
10+ to 20 years			11				2				13				22
20+ to 40 years			12				7				19				33
40+ years			11				2				13				22
Total			46				12				58				100	%

	Final Capping, Closure and Post-Closure Costs

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		Balance as of												Transfers				Additions				Balance as of
		December 31,				Capital				Landfill				and				Charged to				December 31,
		2001				Additions				Acquisitions				Adjustments				Expense				2002
Non-depletable landfill land		$	50.5			$	3.3			$	—			$	.2			$	—			$	54.0
Landfill development costs			958.8				18.1				5.1				44.3				—				1,026.3
Construction in progress — landfill			17.6				56.0				—				(41.3	)			—				32.3
Accumulated depletion and amortization			(237.0	)			—				—				.3				(67.4	)			(304.1	)
Net investment in landfill land and development costs		$	789.9			$	77.4			$	5.1			$	3.5			$	(67.4	)		$	808.5

						Cumulative																Non-Cash
						Effect of																Additions
		Balance as of				Changes in												Transfers				for Asset				Additions				Balance as of
		December 31,				Accounting				Capital				Landfill				and				Retirement				Charged to				December 31,
		2002				Principles				Additions				Acquisitions				Adjustments				Obligations				Expense				2003
Non-depletable landfill land		$	54.0			$	—			$	.1			$	.5			$	(5.1	)		$	—			$	—			$	49.5
Landfill development costs			1,026.3				188.6				3.7				28.9				69.8				17.9				—				1,335.2
Construction in progress — landfill			32.3				—				78.7				—				(50.2	)			—				—				60.8
Accumulated depletion and amortization			(304.1	)			(248.4	)			—				—				.7				—				(92.8	)			(644.6	)
Net investment in landfill land and development costs		$	808.5			$	(59.8	)		$	82.5			$	29.4			$	15.2			$	17.9			$	(92.8	)		$	800.9

																						Non-Cash
																						Additions
		Balance as of																Transfers				for Asset				Additions				Balance as of
		December 31,				Capital								Landfill				and				Retirement				Charged to				December 31,
		2003				Additions				Retirements				Acquisitions				Adjustments				Obligations				Expense				2004
Non-depletable landfill land		$	49.5			$	1.0			$	—			$	1.5			$	1.4			$	—			$	—			$	53.4
Landfill development costs			1,335.2				6.6				(1.9	)			28.9				102.4				15.3				—				1,486.5
Construction in progress — landfill			60.8				78.9				—				—				(100.6	)			—				—				39.1
Accumulated depletion and amortization			(644.6	)			—				1.9				(1.0	)			(.8	)			—				(98.4	)			(742.9	)
Net investment in landfill land and development costs		$	800.9			$	86.5			$	—			$	29.4			$	2.4			$	15.3			$	(98.4	)		$	836.1

		Balance as of				Expected				Total
		December 31,				Future				Expected
		2004				Investment				Investment
Non-depletable landfill land		$	53.4			$	—			$	53.4
Landfill development costs			1,486.5				1,524.1				3,010.6
Construction in progress — landfill			39.1				—				39.1
Accumulated depletion and amortization			(742.9	)			—				(742.9	)
Net investment in landfill land and development costs		$	836.1			$	1,524.1			$	2,360.2

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		Years Ended December 31,
										Pro Forma
		2004				2003				2002				2002
Number of landfills owned or operated			58				58				56				56
Net investment, excluding non-depletable land (in millions)		$	782.7			$	751.4			$	694.7			$	754.5
Total estimated available disposal capacity (in millions of cubic yards)			1,751.8				1,767.3				1,711.2				1,711.2
Net investment per cubic yard		$	.45			$	.43			$	.41			$	.44
Landfill depletion and amortization expense (in millions)		$	98.4			$	92.8			$	86.9			$	67.4
Accretion expense (in millions)			13.7				12.7				10.5				—
Closure and post-closure expense (in millions)			—				—				—				26.1
			112.1				105.5				97.4				93.5
Airspace consumed (in millions of cubic yards)			42.1				39.3				34.6				34.6
Depletion, amortization, accretion, closure and post-closure expense per cubic yard of airspace consumed		$	2.66			$	2.68			$	2.82			$	2.70

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						Closure,
						Post-Closure
		Allowance for				and
		Doubtful Accounts				Remediation				Self-Insurance
Balance, December 31, 2001		$	19.0			$	239.5			$	57.6
Additions charged to expense			11.2				26.1				138.1
Additions due to acquisitions, net of divestitures			.2				5.0				—
Payments or usage			(11.4	)			(14.8	)			(120.7	)
Balance, December 31, 2002			19.0				255.8				75.0
Current portion			19.0				22.1				33.9
Long-term portion		$	—			$	233.7			$	41.1

							Final Capping,
			Allowance for				Closure and
			Doubtful Accounts				Post-Closure				Remediation				Self-Insurance
Balance, December 31, 2002			$	19.0			$	196.9			$	58.9			$	75.0
Cumulative effect of change in accounting principle				—				(14.5	)			—				—
Non-cash asset additions				—				17.9				—				—
Accretion expense				—				12.7				—				—
Other additions charged to expense				10.4				—				—				189.5
Payments or usage				(10.4	)			(8.3	)			(4.2	)			(142.3	)
Balance, December 31, 2003				19.0				204.7				54.7				122.2
	Current portion			19.0				29.5				4.4				47.6
	Long-term portion		$	—			$	175.2			$	50.3			$	74.6

							Final Capping,
			Allowance for				Closure and
			Doubtful Accounts				Post-Closure				Remediation				Self-Insurance
Balance, December 31, 2003			$	19.0			$	204.7			$	54.7			$	122.2
Non-cash asset additions				—				19.6				—				—
Revisions in estimates of future cash flows recorded as non-cash asset additions				—				(4.3	)			—				—
Accretion expense				—				13.7				—				—
Other additions charged to expense				8.0				—				1.7				165.3
Additions due to acquisitions				—				.6				—				—
Payments or usage				(9.0	)			(17.5	)			(2.4	)			(143.7	)
Balance, December 31, 2004				18.0				216.8				54.0				143.8
	Current portion			18.0				14.6				2.7				47.4
	Long-term portion		$	—			$	202.2			$	51.3			$	96.4

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			Gross Property and Equipment
			Balance as of												Acquisitions,								Balance as of
			December 31,				Capital								Net of				Transfers and				December 31,
			2001				Additions				Retirements				Divestitures				Adjustments				2002
Other land			$	94.3			$	5.1			$	(2.5	)		$	(7.0	)		$	(.2	)		$	89.7
Non-depletable landfill land				50.5				3.3				—				—				.2				54.0
Landfill development costs				958.8				18.1				—				5.1				44.3				1,026.3
Vehicles and equipment				1,153.2				220.8				(47.8	)			15.1				15.5				1,356.8
Buildings and improvements				256.4				12.6				(2.3	)			(3.4	)			7.6				270.9
Construction in progress — landfill				17.6				56.0				—				—				(41.3	)			32.3
Construction in progress — other				23.5				15.3				—				—				(29.7	)			9.1
	Total		$	2,554.3			$	331.2			$	(52.6	)		$	9.8			$	(3.6	)		$	2,839.1

			Accumulated Depreciation, Amortization and Depletion
			Balance as of				Additions								Acquisitions,								Balance as of
			December 31,				Charged to								Net of				Transfers and				December 31,
			2001				Expense				Retirements				Divestitures				Adjustments				2002
Landfill development costs			$	(237.0	)		$	(67.4	)		$	—			$	—			$	.3			$	(304.1	)
Vehicles and equipment				(495.7	)			(116.5	)			36.9				1.8				3.4				(570.1	)
Buildings and improvements				(46.7	)			(9.6	)			1.2				.3				(.1	)			(54.9	)
	Total		$	(779.4	)		$	(193.5	)		$	38.1			$	2.1			$	3.6			$	(929.1	)

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			Gross Property and Equipment
							Cumulative																Non-Cash
							Effect																Additions for
			Balance as of				of Changes in												Acquisitions,				Asset								Balance as of
			December 31,				Accounting				Capital								Net of				Retirement				Transfers and				December 31,
			2002				Principles				Additions				Retirements				Divestitures				Obligations				Adjustments				2003
Other land			$	89.7			$	—			$	6.4			$	(1.7	)		$	—			$	—			$	—			$	94.4
Non-depletable landfill land				54.0				—				.1				—				.5				—				(5.1	)			49.5
Landfill development costs				1,026.3				188.6				3.7				—				28.9				17.9				69.8				1,335.2
Vehicles and equipment				1,356.8				—				163.4				(39.3	)			10.7				—				(1.0	)			1,490.6
Buildings and improvements				270.9				(11.7	)			3.9				(2.8	)			.9				—				6.2				267.4
Construction in progress — landfill				32.3				—				78.7				—				—				—				(50.2	)			60.8
Construction in progress — other				9.1				—				17.0				—				—				—				(19.7	)			6.4
	Total		$	2,839.1			$	176.9			$	273.2			$	(43.8	)		$	41.0			$	17.9			$	—			$	3,304.3

			Accumulated Depreciation, Amortization and Depletion
							Cumulative
							Effect
			Balance as of				of Changes in				Additions								Acquisitions,								Balance as of
			December 31,				Accounting				Charged to								Net of				Transfers and				December 31,
			2002				Principles				Expense				Retirements				Divestitures				Adjustments				2003
Landfill development costs			$	(304.1	)		$	(248.4	)		$	(92.8	)		$	—			$	—			$	.7			$	(644.6	)
Vehicles and equipment				(570.1	)			—				(131.6	)			34.1				.4				.8				(666.4	)
Buildings and improvements				(54.9	)			3.0				(9.4	)			.5				—				(1.5	)			(62.3	)
	Total		$	(929.1	)		$	(245.4	)		$	(233.8	)		$	34.6			$	.4			$	—			$	(1,373.3	)

			Gross Property and Equipment
																			Non-Cash
																			Additions for
			Balance as of												Acquisitions,				Asset								Balance as of
			December 31,				Capital								Net of				Retirement				Transfers and				December 31,
			2003				Additions				Retirements				Divestitures				Obligations				Adjustments				2004
Other land			$	94.4			$	3.1			$	(0.7	)		$	.9			$	—			$	.2			$	97.9
Non-depletable landfill land				49.5				1.0				—				1.5				—				1.4				53.4
Landfill development costs				1,335.2				6.6				(1.9	)			28.9				15.3				102.4				1,486.5
Vehicles and equipment				1,490.6				169.1				(48.2	)			5.3				—				.7				1,617.5
Buildings and improvements				267.4				11.4				(1.4	)			1.0				—				8.6				287.0
Construction in progress — landfill				60.8				78.9				—				—				—				(100.6	)			39.1
Construction in progress — other				6.4				13.7				—				—				—				(12.7	)			7.4
	Total		$	3,304.3			$	283.8			$	(52.2	)		$	37.6			$	15.3			$	—			$	3,588.8

			Accumulated Depreciation, Amortization and Depletion
			Balance as of				Additions								Acquisitions,								Balance as of
			December 31,				Charged to								Net of				Transfers and				December 31,
			2003				Expense				Retirements				Divestitures				Adjustments				2004
Landfill development costs			$	(644.6	)		$	(98.4	)		$	1.9			$	(1.0	)		$	(.8	)		$	(742.9	)
Vehicles and equipment				(666.4	)			(143.5	)			43.5				—				.1				(766.3	)
Buildings and improvements				(62.3	)			(10.5	)			1.2				—				.8				(70.8	)
	Total		$	(1,373.3	)		$	(252.4	)		$	46.6			$	(1.0	)		$	.1			$	(1,580.0	)

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											Maturities
											of Notes				Final
											Payable and				Capping,								Amounts Due				Unconditional
			Operating				Capital				Long-Term				Closure and								to Former				Purchase
Year Ending December 31,			Leases				Leases				Debt				Post-Closure				Remediation				Owners				Commitments				Total
2005			$	4.1			$	—			$	2.4			$	14.6			$	2.7			$	4.3			$	27.6			$	55.7
2006				3.1				—				2.2				58.1				2.5				—				9.9				75.8
2007				2.8				—				1.6				49.5				2.5				—				2.0				58.4
2008				1.6				—				1.2				20.1				2.5				—				1.4				26.8
2009				1.3				—				376.1				31.9				2.5				—				1.4				413.2
Thereafter				5.6				25.0				947.0				457.7				41.3				—				11.8				1,488.4
	Total		$	18.5			$	25.0			$	1,330.5			$	631.9			$	54.0			$	4.3			$	54.1			$	2,118.3

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		Expected Maturity Date
																														Fair Value
																														(Asset)/Liability
																														December 31,
		2005				2006				2007				2008				2009				Thereafter				Total				2004
VARIABLE RATE DEBT:
Amount outstanding (in millions)		$	.6			$	.3			$	—			$	—			$	—			$	228.2			$	229.1			$	229.1
Average interest rates			2.2	%			2.2	%			—				—				—				2.2	%			2.2	%
INTEREST RATE SWAPS:
Amount outstanding (in millions)		$	—			$	—			$	—			$	—			$	—			$	210.0			$	210.0			$	(.5	)
Average interest rates			—	%			—				—				—				—				2.3	%			2.3	%

		2004				2003				2002
Cash provided by operating activities		$	666.3			$	600.5			$	569.7
Purchases of property and equipment			(283.8	)			(273.2	)			(258.6	)
Proceeds from the sale of property and equipment			5.7				9.1				14.6
Free cash flow		$	388.2			$	336.4			$	325.7

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	1. A “modified-prospective” method in which compensation cost is recognized beginning with the effective date (a) based on the requirements of SFAS 123(R) for all share-based payments granted after the effective date and (b) based on the requirements of SFAS 123 for all awards granted to employees prior to the effective date of SFAS 123(R) that remain unvested on the effective date.
	2. A “modified-retrospective” method which includes the requirements of the modified-prospective method described above, but also permits entities to restate based on the amounts previously reflected in their SFAS 123 pro forma disclosures either (a) all prior periods presented or (b) prior interim periods of the year of adoption.

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		Page
Report of Independent Registered Public Accounting Firm on the Financial Statements			51
Report of Independent Registered Public Accounting Firm on Internal Control over Financial Reporting			52
Consolidated Balance Sheets as of December 31, 2004 and 2003			53
Consolidated Statements of Income for each of the Three Years Ended December 31, 2004			54
Consolidated Statements of Stockholders’ Equity and Comprehensive Income for each of the Three Years Ended December 31, 2004			55
Consolidated Statements of Cash Flows for each of the Three Years Ended December 31, 2004			56
Notes to Consolidated Financial Statements			57
Financial Statement Schedule II, Valuation and Qualifying Accounts and Reserves, for each of the Three Years Ended December 31, 2004			94

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	/s/ Ernst & Young LLP
	Certified Public Accountants

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	/s/ Ernst & Young LLP
	Certified Public Accountants

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				December 31,
				2004				2003
ASSETS
CURRENT ASSETS:
	Cash and cash equivalents			$	141.5			$	119.2
	Accounts receivable, less allowance for doubtful accounts of $18.0 and $19.0 at December 31, 2004 and 2003, respectively				268.7				248.9
	Prepaid expenses and other current assets				76.4				182.1
	Deferred tax assets				9.9				5.8
		Total Current Assets			496.5				556.0
	RESTRICTED CASH				237.0				215.0
	RESTRICTED MARKETABLE SECURITIES				38.7				182.4
	PROPERTY AND EQUIPMENT, NET				2,008.8				1,931.0
	GOODWILL, NET				1,562.7				1,558.1
	INTANGIBLE ASSETS, NET				30.2				25.0
	OTHER ASSETS				90.7				86.6
				$	4,464.6			$	4,554.1
LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES:
	Accounts payable			$	119.6			$	129.1
	Accrued liabilities				135.3				118.6
	Deferred revenue				99.7				88.5
	Notes payable and current maturities of long-term debt				2.4				231.1
	Other current liabilities				89.6				104.7
		Total Current Liabilities			446.6				672.0
LONG-TERM DEBT, NET OF CURRENT MATURITIES					1,351.9				1,289.2
ACCRUED LANDFILL AND ENVIRONMENTAL COSTS					253.5				225.5
DEFERRED INCOME TAXES					406.5				353.5
OTHER LIABILITIES					133.6				109.4
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS’ EQUITY:
	Preferred stock, par value $.01 per share; 50,000,000 shares authorized; none issued				—				—
	Common stock, par value $.01 per share; 750,000,000 shares authorized, 185,750,304 and 183,431,611 issued, including shares held in treasury, respectively				1.9				1.8
	Additional paid-in capital				1,399.4				1,347.8
	Deferred compensation				(1.0	)			—
	Retained earnings				1,222.6				1,039.3
	Treasury stock, at cost (35,168,400 and 25,604,100 shares, respectively)				(750.4	)			(484.3	)
	Accumulated other comprehensive loss, net of tax				—				(.1	)
		Total Stockholders’ Equity			1,872.5				1,904.5
				$	4,464.6			$	4,554.1

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			Years Ended December 31,
			2004				2003				2002
REVENUE			$	2,708.1			$	2,517.8			$	2,365.1
EXPENSES:
	Cost of operations			1,714.4				1,605.4				1,472.9
	Depreciation, amortization and depletion			259.4				239.1				199.6
	Accretion			13.7				12.7				—
	Selling, general and administrative			268.3				247.9				238.7
	Other charges (income)			—				—				(5.6	)
OPERATING INCOME				452.3				412.7				459.5
INTEREST EXPENSE				(76.7	)			(78.0	)			(77.0	)
INTEREST INCOME				6.9				9.5				4.3
OTHER INCOME (EXPENSE), NET				1.2				3.2				(.3	)
INCOME BEFORE INCOME TAXES				383.7				347.4				386.5
PROVISION FOR INCOME TAXES				145.8				132.0				146.9
INCOME BEFORE CUMULATIVE EFFECT OF CHANGES IN ACCOUNTING PRINCIPLES				237.9				215.4				239.6
CUMULATIVE EFFECT OF CHANGES IN ACCOUNTING PRINCIPLES, NET OF TAX				—				(37.8	)			—
NET INCOME			$	237.9			$	177.6			$	239.6
BASIC EARNINGS PER SHARE:
	Before cumulative effect of changes in accounting principles		$	1.56			$	1.34			$	1.45
	Cumulative effect of changes in accounting principles, net of tax			—				(.23	)			—
	Basic earnings per share		$	1.56			$	1.11			$	1.45
	Weighted average common shares outstanding			152.8				160.3				165.4
DILUTED EARNINGS PER SHARE:
	Before cumulative effect of changes in accounting principles		$	1.53			$	1.33			$	1.44
	Cumulative effect of changes in accounting principles, net of tax			—				(.23	)			—
	Diluted earnings per share		$	1.53			$	1.10			$	1.44
	Weighted average common and common equivalent shares outstanding			155.3				162.1				166.7
CASH DIVIDENDS PER COMMON SHARE			$	.36			$	.12			$	—
PRO FORMA AMOUNTS ASSUMING THE CHANGES IN ACCOUNTING PRINCIPLES ARE APPLIED RETROACTIVELY:
	Net income		$	237.9			$	215.4			$	237.2
	Basic earnings per share		$	1.56			$	1.34			$	1.43
	Diluted earnings per share		$	1.53			$	1.33			$	1.42

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			Common Stock																								Accumulated
											Additional																Other
			Shares,				Par				Paid-In				Deferred				Retained				Treasury				Comprehensive				Comprehensive
			Net				Value				Capital				Compensation				Earnings				Stock				Income (Loss)				Income
BALANCE AT DECEMBER 31, 2001				169.6			$	1.8			$	1,264.7			$	—			$	641.1			$	(150.1	)		$	(1.6	)
	Net income			—				—				—				—				239.6				—				—			$	239.6
	Issuances of common stock			2.0				—				34.0				—				—				—				—				—
	Purchases of common stock for treasury			(8.0	)			—				—				—				—				(150.0	)			—				—
	Change in value of derivative instruments, net of tax			—				—				—				—				—				—				1.6				1.6
	Total comprehensive income			—				—				—				—				—				—				—			$	241.2
BALANCE AT DECEMBER 31, 2002				163.6				1.8				1,298.7				—				880.7				(300.1	)			—
	Net income			—				—				—				—				177.6				—				—			$	177.6
	Cash dividends			—				—				—				—				(19.0	)			—				—				—
	Issuances of common stock			2.6				—				49.1				—				—				—				—
	Purchases of common stock for treasury			(8.4	)			—				—				—				—				(184.2	)			—
	Change in value of investments, net of tax			—				—				—				—				—				—				(.1	)			(.1	)
	Total comprehensive income			—				—				—				—				—				—				—			$	177.5
BALANCE AT DECEMBER 31, 2003				157.8				1.8				1,347.8				—				1,039.3				(484.3	)			(.1	)
	Net income			—				—				—				—				237.9				—				—			$	237.9
	Cash dividends			—				—				—				—				(54.6	)			—				—				—
	Issuances of common stock			2.3				.1				48.8				—				—				—				—				—
	Issuances of restricted stock and deferred stock units			.1				—				2.8				(2.8	)			—				—				—				—
	Amortization of deferred compensation			—				—				—				1.8				—				—				—				—
	Purchases of common stock for treasury			(9.6	)			—				—				—				—				(266.1	)			—				—
	Change in value of investments, net of tax			—				—				—				—				—				—				.1				.1
	Total comprehensive income			—				—				—				—				—				—				—			$	238.0
BALANCE AT DECEMBER 31, 2004				150.6			$	1.9			$	1,399.4			$	(1.0	)		$	1,222.6			$	(750.4	)		$	—

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					Years Ended December 31,
					2004				2003				2002
CASH PROVIDED BY OPERATING ACTIVITIES:
	Net income				$	237.9			$	177.6			$	239.6
	Adjustments to reconcile net income to net cash provided by operating activities:
		Depreciation and amortization of property and equipment				154.0				141.0				126.1
		Landfill depletion and amortization				98.4				92.8				67.4
		Amortization of intangible and other assets				7.0				5.3				6.1
		Accretion				13.7				12.7				—
		Deferred tax provision				57.6				178.9				73.1
		Provision for doubtful accounts				8.0				10.4				11.2
		Income tax benefit from stock option exercises				10.6				6.7				4.0
		Other non-cash items				2.1				(1.8	)			(4.8	)
		Cumulative effect of changes in accounting principles, net of tax				—				37.8				—
		Changes in assets and liabilities, net of effects from business acquisitions and dispositions:
			Accounts receivable			(27.5	)			(21.8	)			(13.6	)
			Prepaid expenses and other assets			91.8				(109.4	)			(5.9	)
			Accounts payable and accrued liabilities			15.3				9.0				37.1
			Other liabilities			(2.6	)			61.3				29.4
						666.3				600.5				569.7
CASH USED IN INVESTING ACTIVITIES:
	Purchases of property and equipment					(283.8	)			(273.2	)			(258.6	)
	Proceeds from sale of property and equipment					5.7				9.1				14.6
	Cash used in business acquisitions, net of cash acquired					(47.3	)			(51.5	)			(55.8	)
	Cash proceeds from business dispositions					—				3.2				18.9
	Amounts due and contingent payments to former owners					(3.7	)			(17.6	)			(2.7	)
	Change in restricted cash					(21.4	)			(40.0	)			(32.7	)
	Change in restricted marketable securities					143.8				(182.4	)			—
						(206.7	)			(552.4	)			(316.3	)
CASH USED IN FINANCING ACTIVITIES:
	Net payments on revolving credit facility					—				—				(30.0	)
	Proceeds from notes payable and long-term debt					88.8				86.3				96.9
	Payments of notes payable and long-term debt					(252.2	)			(2.6	)			(2.2	)
	Issuances of common stock					38.2				49.1				29.9
	Purchases of common stock for treasury					(266.1	)			(184.2	)			(150.0	)
	Cash dividends					(46.0	)			(19.0	)			—
	Purchase of equipment under operating lease					—				—				(72.6	)
						(437.3	)			(70.4	)			(128.0	)
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS						22.3				(22.3	)			125.4
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD						119.2				141.5				16.1
CASH AND CASH EQUIVALENTS AT END OF PERIOD					$	141.5			$	119.2			$	141.5

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1.	BASIS OF PRESENTATION

			Year Ended
			December 31, 2002
			Net				Diluted Earnings
			Income				Per Share
Reported			$	239.6			$	1.44
SFAS 143:
	Reversal of closure and post-closure expense previously reported			16.2				.10
	Reversal of landfill purchase price amortization previously reported			.8				—
	Accretion expense			(6.5	)			(.04	)
	Landfill amortization			(10.9	)			(.07	)
Total adjustments for SFAS 143				(.4	)			(.01	)
Methane Gas Collection Systems:
	Reversal of depreciation previously reported			.3				—
	Depletion expense			(2.3	)			(.01	)
Total adjustment for methane gas collection systems				(2.0	)			(.01	)
Adjusted			$	237.2			$	1.42

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			December 31,								January 1,
			2002				Change				2003
Property and equipment:
	Landfill development costs		$	1,026.3			$	188.6			$	1,214.9
	Buildings and improvements			270.9				(11.7	)			259.2
	Accumulated depletion and amortization			(304.1	)			(245.4	)			(549.5	)
			$	993.1			$	(68.5	)		$	924.6
Goodwill:
	Goodwill		$	1,687.7			$	(6.9	)		$	1,680.8
	Accumulated amortization			(143.5	)			(.1	)			(143.6	)
			$	1,544.2			$	(7.0	)		$	1,537.2
Final capping, closure and post-closure liabilities:
	Current landfill liabilities		$	17.9			$	—			$	17.9
	Long-term landfill liabilities			179.0				(14.5	)			164.5
			$	196.9			$	(14.5	)		$	182.4

2.	SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

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		December 31,
		2004				2003
Inventory		$	19.1			$	17.7
Prepaid expenses			17.8				20.5
Other non-trade receivables			17.4				27.9
Income taxes receivable			19.7				87.6
Note receivable			—				23.0
Other assets			2.4				5.4
		$	76.4			$	182.1

	1. Total construction costs are $50,000 or greater,
	2. The construction phase is one month or longer, and
	3. The assets have a useful life of one year or longer.

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			December 31,
			2004				2003
Other land			$	97.9			$	94.4
Non-depletable landfill land				53.4				49.5
Landfill development costs				1,486.5				1,335.2
Vehicles and equipment				1,617.5				1,490.6
Buildings and improvements				287.0				267.4
Construction-in-progress — landfill				39.1				60.8
Construction-in-progress — other				7.4				6.4
				3,588.8				3,304.3
Less: Accumulated depreciation, depletion and amortization — Landfill development costs				(742.9	)			(644.6	)
	Vehicles and equipment			(766.3	)			(666.4	)
	Building and improvements			(70.8	)			(62.3	)
				(1,580.0	)			(1,373.3	)
Property and equipment, net			$	2,008.8			$	1,931.0

	•	A significant decrease in the market price of a long-lived asset or asset group,
	•	A significant adverse change in the extent or manner in which a long-lived asset or asset group is being used or in its physical condition,
	•	A significant adverse change in legal factors or in the business climate that could affect the value of a long-lived asset or asset group, including an adverse action or assessment by a regulator,
	•	An accumulation of costs significantly in excess of the amount originally expected for the acquisition or construction of a long-lived asset or asset group,
	•	A current-period operating or cash flow loss combined with a history of operating or cash flow losses or a projection or forecast that demonstrates continuing losses associated with the use of a long-lived asset or asset group, or
	•	A current expectation that, more likely than not, a long-lived asset or asset group will be sold or otherwise disposed of significantly before the end of its previously estimated useful life.

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			Gross Intangible Assets
			Goodwill				Other				Total
Balance, December 31, 2002			$	1,687.7			$	40.0			$	1,727.7
	Cumulative effect of change in accounting principle			(6.9	)			—				(6.9	)
	Acquisitions			21.2				3.1				24.3
	Other additions			—				.1				.1
	Divestitures			(.5	)			—				(.5	)
Balance, December 31, 2003			$	1,701.5			$	43.2			$	1,744.7

			Accumulated Amortization
			Goodwill				Other				Total
Balance, December 31, 2002			$	(143.5	)		$	(14.3	)		$	(157.8	)
	Cumulative effect of change in accounting principle			(.1	)			—				(.1	)
	Amortization expense			—				(3.9	)			(3.9	)
	Divestitures			.2				—				.2
Balance, December 31, 2003			$	(143.4	)		$	(18.2	)		$	(161.6	)

			Gross Intangible Assets
			Goodwill				Other				Total
Balance, December 31, 2003			$	1,701.5			$	43.2			$	1,744.7
	Acquisitions			13.2				.9				14.1
	Other additions			—				1.5				1.5
	Transfers			(8.6	)			8.6				—
Balance, December 31, 2004			$	1,706.1			$	54.2			$	1,760.3

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			Accumulated Amortization
			Goodwill				Other				Total
Balance, December 31, 2003			$	(143.4	)		$	(18.2	)		$	(161.6	)
	Amortization expense			—				(5.8	)			(5.8	)
Balance, December 31, 2004			$	(143.4	)		$	(24.0	)		$	(167.4	)

	•	A significant adverse change in legal factors or in the business climate,
	•	An adverse action or assessment by a regulator,
	•	A more likely than not expectation that a segment or a significant portion thereof will be sold, or
	•	The testing for recoverability under Statement of Financial Accounting Standards No. 144, “Accounting for the Impairment of Long-Lived Assets,” of a significant asset group within the segment.

		December 31,
		2004				2003
Accrued payroll and benefits		$	51.3			$	43.2
Accrued fees and taxes			31.4				29.6
Accrued interest			18.4				18.7
Accrued dividends			18.1				9.5
Other			16.1				17.6
		$	135.3			$	118.6

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		December 31,
		2004				2003
Accrued landfill and environmental costs, current portion		$	21.0			$	37.6
Self-insurance reserves, current			47.4				47.6
Amounts due to former owners			4.3				6.1
Other			16.9				13.4
		$	89.6			$	104.7

				Years Ended December 31,
				2004				2003				2002
Net income, as reported				$	237.9			$	177.6			$	239.6
	Adjustment to net earnings for:
		Stock-based compensation expense included in net income, net of tax			1.1				—				—
		Pro-forma stock-based employee compensation expense pursuant to SFAS No. 123, net of tax			(9.7	)			(9.4	)			(10.7	)
Net income, pro forma				$	229.3			$	168.2			$	228.9
Basic earnings per share —
	As reported			$	1.56			$	1.11			$	1.45
	Pro forma			$	1.50			$	1.05			$	1.38
Diluted earnings per share —
	As reported			$	1.53			$	1.10			$	1.44
	Pro forma			$	1.48			$	1.04			$	1.37

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			Years Ended December 31,
			2004				2003				2002
Weighted-average fair value of the Company’s stock options, restricted stock and stock units granted during the period			$	9.33			$	7.64			$	7.47
Assumptions —
	Risk-free interest rates			3.6	%			3.2	%			2.7	%
	Expected lives			5 years				5 years				5 years
	Expected volatility			30.0	%			40.0	%			40.0	%
	Dividend yield			.9	%			—				—

	•	Persuasive evidence of an arrangement exists such as a service agreement with a municipality, a hauling customer or a disposal customer,
	•	Services have been performed such as the collection and hauling of waste or the disposal of waste at a Company-owned disposal facility,
	•	The price of the services provided to the customer are fixed or determinable, and
	•	Collectability is reasonably assured.

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	1.	A “modified-prospective” method in which compensation cost is recognized beginning with the effective date (a) based on the requirements of SFAS 123(R) for all share-based payments granted after the effective date and (b) based on the requirements of SFAS 123 for all awards granted to employees prior to the effective date of SFAS 123(R) that remain unvested on the effective date.
	2.	A “modified-retrospective” method which includes the requirements of the modified-prospective method described above, but also permits entities to restate based on the amounts previously reflected in their SFAS 123 pro forma disclosures either (a) all prior periods presented or (b) prior interim periods of the year of adoption.

3.	ACCRUED LANDFILL AND ENVIRONMENTAL COSTS

		December 31,
		2004				2003
Landfill final capping, closure and post-closure liabilities		$	216.8			$	204.7
Remediation			54.0				54.7
Environmental and legal costs			3.7				3.7
			274.5				263.1
Less: Current portion (included in other current liabilities)			(21.0	)			(37.6	)
		$	253.5			$	225.5

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	1.	The land associated with the expansion airspace is either owned by the Company or is controlled by the Company pursuant to an option agreement;
	2.	The Company is committed to supporting the expansion project financially and with appropriate resources;
	3.	There are no identified fatal flaws or impediments associated with the project, including political impediments;
	4.	Progress is being made on the project;
	5.	The expansion is attainable within a reasonable time frame; and
	6.	The Company believes it is likely the expansion permit will be received.

	1.	Obtaining approval from local authorities;
	2.	Submitting a permit application to state authorities; and
	3.	Obtaining permit approval from state authorities.

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				Current Practice
Description		Historical Practice		(Effective January 1, 2003)
DEFINITIONS:
Final Capping		Costs related to installation of the components that comprise the permanent final cover over areas of a landfill where airspace capacity has been consumed.		No change.
Closure		Includes routine maintenance costs incurred after a site ceases to accept waste, but prior to being certified closed.		No change, except that it includes the final portion of the methane gas collection system to be constructed.

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				Current Practice
Description		Historical Practice		(Effective January 1, 2003)
Post-Closure		Includes routine monitoring and maintenance of a landfill after it has been certified as closed by the applicable state regulatory agency.		No change, except it includes methane gas collection systems in all cases where the need for such systems are considered probable.
DISCOUNT RATE:		Not applicable.		Credit-adjusted, risk-free rate of 6.5% and 6.75% for the years ending December 31, 2004 and 2003, respectively.
INFLATION:		Not applicable.		Inflation rate of 2.5%.
COST ESTIMATES:		Cost estimates generally assume work will be performed by third parties.		No change, except that the cost of any activities performed internally is increased to represent an estimate of the amount a third party would charge to perform such activity. This third party profit is taken in to income in the period the work is performed internally.
METHANE GAS COLLECTION SYSTEMS:		Capitalized when constructed and charged to expense through depreciation over the shorter of their useful life or the life of the landfill.		During the active life of a landfill, included in cell development costs when the need for such systems is considered probable; charged to expense through depletion as airspace is consumed using the units-of-consumption method. Systems associated with the last final capping event at a landfill are included in closure costs.
RECOGNITION OF LIABILITY:
Final Capping		Accrued over the life of the landfill. Costs are charged to cost of operations and accrued liabilities as airspace is consumed using the units-of-consumption method. Costs are not discounted.		All final capping costs are recorded as a liability and asset at fair value as the obligation is incurred. The discounted cash flow associated with each final capping event is recorded to an accrued liability, with a corresponding increase to landfill assets as airspace is consumed related to the specific final capping event. Interest is accreted on the liability using the effective interest method until the liability is paid.
STATEMENT OF INCOME:
Cost of Operations		Expense charged to cost of operations equal to amount of liability accrued.		Not applicable.

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				Current Practice
Description		Historical Practice		(Effective January 1, 2003)
Landfill Asset Amortization		Not applicable.		The landfill asset is amortized as airspace is consumed over the life of a specific capping event for final capping or the life of a landfill for closure and post-closure.
Accretion		Not applicable.		Expense recognized as a component of operating expenses at credit-adjusted, risk-free rate using the effective interest method.

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			Years Ended December 31,
			2004				2003				2003				2002
			Actual				Actual				Pro Forma				Pro Forma
Asset retirement obligation liability, beginning of year			$	204.7			$	196.9			$	182.4			$	167.8
Cumulative effect of change in accounting principle				—				(14.5	)			—				—
Non-cash asset additions				19.6				—				—				—
Revisions in estimate of future cash flows				(4.3	)			—				—				—
Acquisitions				.6				—				—				—
Additions incurred during the period				—				17.9				17.9				18.9
Amounts settled during the period				(17.5	)			(8.3	)			(8.3	)			(14.8	)
Accretion expense				13.7				12.7				12.7				10.5
Asset retirement obligation liability, end of year				216.8				204.7				204.7				182.4
	Less: Current portion			(14.6	)			(29.5	)			(29.5	)			(22.1	)
	Long-term portion		$	202.2			$	175.2			$	175.2			$	160.3

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Years Ending
December 31,
2005		$	14.6
2006			58.1
2007			49.5
2008			20.1
2009			31.9
Thereafter			457.7
		$	631.9

Years Ending
December 31,
2005		$	2.7
2006			2.5
2007			2.5
2008			2.5
2009			2.5
Thereafter			41.3
		$	54.0

4.	BUSINESS COMBINATIONS

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		Years Ended December 31,
		2004				2003				2002
Property and equipment		$	36.6			$	41.3			$	27.0
Intangible assets			14.1				24.3				43.0
Restricted cash			.6				—				—
Working capital deficit			(3.4	)			(14.9	)			(8.9	)
Other assets (liabilities), net			(.6	)			.8				(5.3	)
Cash used in acquisitions, net of cash acquired		$	47.3			$	51.5			$	55.8

		Years Ended
		December 31,
		2004				2003
Revenue		$	2,715.1			$	2,530.0
Net income		$	238.1			$	179.7
Diluted earnings per share		$	1.53			$	1.11
Weighted-average common and common equivalent shares outstanding			155.3				162.1

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5.	DEBT

		December 31,
		2004				2003
$225.0 million unsecured notes, net of unamortized discount $.1 million and including a $3.3 million adjustment to fair market value as of December 31, 2003; interest payable semi-annually in May and November at 65/8%; principal due at maturity in May 2004		$	—			$	228.2
$375.0 million unsecured notes, net of unamortized discount of $.3 million and $.4 million as of December 31, 2004 and 2003, respectively; interest payable semi-annually in May and November at 71/8%; principal due at maturity in 2009			374.7				374.6
$450.0 million unsecured notes, net of unamortized discount of $1.9 million and $2.2 million, and including $.5 million and $0 million adjustments to fair value as of December 31, 2004 and 2003, respectively; interest payable semi-annually in February and August at 63/4%; principal due at maturity in 2011			448.6				447.8
$750.0 million unsecured revolving credit facility; interest payable using LIBOR based rates (2.4% at December 31, 2004); $300.0 million matures June 2005 and $450.0 million matures July 2007			—				—
Tax-exempt bonds and other tax-exempt financing; fixed and floating interest rates (ranging from 2% to 51/4% at December 31, 2004); maturities ranging from 2005 to 2037			527.3				463.2
Other notes including unsecured and secured by real property, equipment and other assets; fixed and floating interest rates ranging from 4% to 12%; maturing through 2010			3.7				6.5
			1,354.3				1,520.3
Less: Current portion			2.4				231.1
Long-term portion		$	1,351.9			$	1,289.2

Years Ending December 31,
2005		$	2.4
2006			2.2
2007			1.6
2008			1.2
2009			376.1
Thereafter			972.0
		$	1,355.5

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6.	INCOME TAXES

			Years Ended December 31,
			2004				2003				2002
Current:
	Federal		$	81.2			$	(51.4	)		$	62.0
	State			7.0				4.5				11.8
Federal and state deferred				57.6				178.9				73.1
Provision for income taxes			$	145.8			$	132.0			$	146.9

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		Years Ended
		December 31,
		2004				2003				2002
Statutory federal income tax rate			35.0	%			35.0	%			35.0	%
Non-deductible expenses			1.3				1.9				.7
State income taxes, net of federal benefit			2.4				1.7				2.1
Other, net			(.7	)			(.6	)			.2
Effective income tax rate			38.0	%			38.0	%			38.0	%

					December 31,
					2004				2003
Deferred tax assets (liabilities):
	Current portion —
		Book basis in property over tax basis			$	1.8			$	2.5
		Accruals not currently deductible				8.1				3.3
			Total		$	9.9			$	5.8
	Long-term portion —
		Book basis in property over tax basis			$	(434.4	)		$	(367.3	)
		Accruals not currently deductible				27.9				13.8
			Total		$	(406.5	)		$	(353.5	)

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7.	STOCKHOLDERS’ EQUITY

8.	EMPLOYEE BENEFIT PLANS

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						Weighted-Average
		Shares				Exercise Price
Units outstanding at December 31, 2001			12.4			$	16.22
Granted			2.3				17.45
Exercised			(1.9	)			15.18
Cancelled			(.2	)			15.39
Units outstanding at December 31, 2002			12.6				16.61
Granted			2.0				19.30
Exercised			(2.5	)			16.21
Cancelled			(.3	)			16.02
Units outstanding at December 31, 2003			11.8				17.18
Granted			1.8				24.65
Exercised			(2.3	)			16.24
Cancelled			(.2	)			19.72
Units outstanding at December 31, 2004			11.1			$	18.51

		Outstanding												Exercisable
						Weighted-
						Average				Weighted-								Weighted-
						Remaining				Average								Average
						Contractual				Exercise								Exercise
Range of Exercise Price		Shares				Life (Yrs.)				Price				Shares				Price
$10.16 — $13.55			.6				3.5			$	11.87				.6			$	11.87
$13.56 — $16.93			1.3				4.9				14.68				.9				14.73
$16.94 — $20.32			7.3				4.8				18.12				5.1				17.93
$20.33 — $33.88			1.8				8.6				26.05				.2				24.78
			11.0				5.4				18.68				6.8				17.13

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9.	EARNINGS PER SHARE

				Years Ended December 31,
				2004				2003				2002
Numerator:
	Net income			$	237.9			$	177.6			$	239.6
Denominator:
	Denominator for basic earnings per share				152.8				160.3				165.4
	Effect of dilutive securities —
		Options to purchase common stock			2.5				1.8				1.3
		Denominator for diluted earnings per share			155.3				162.1				166.7
		Basic earnings per share		$	1.56			$	1.11			$	1.45
		Diluted earnings per share		$	1.53			$	1.10			$	1.44
Antidilutive securities not included in the diluted earnings per share calculation:
		Options to purchase common stock			—				.1				.8
		Weighted-average exercise price		$	31.50			$	25.02			$	19.87

10.	SEGMENT INFORMATION

															Depreciation,
															Amortization,
			Gross				Intercompany				Net				Depletion and				Operating				Capital				Total
2004			Revenue				Revenue(b)				Revenue				Accretion(c)				Income				Expenditures(d)				Assets
Eastern Region			$	648.6			$	(103.2	)		$	545.4			$	43.8			$	80.0			$	51.4			$	878.5
Central Region				700.9				(156.6	)			544.3				79.4				100.9				84.9				1,083.6
Southern Region				751.9				(79.6	)			672.3				66.7				110.8				71.4				879.3
Southwestern Region				342.1				(33.0	)			309.1				30.6				41.2				24.7				405.3
Western Region				788.4				(151.9	)			636.5				48.3				158.3				48.7				817.6
Corporate Entities(a)				.6				(.1	)			.5				4.3				(38.9	)			2.7				400.3
	Total		$	3,232.5			$	(524.4	)		$	2,708.1			$	273.1			$	452.3			$	283.8			$	4,464.6

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															Depreciation,
															Amortization,
			Gross				Intercompany				Net				Depletion and				Operating				Capital				Total
2003			Revenue				Revenue(b)				Revenue				Accretion(c)				Income				Expenditures(d)				Assets
Eastern Region			$	600.2			$	(93.0	)		$	507.2			$	36.4			$	71.3			$	40.7			$	826.9
Central Region				671.7				(151.6	)			520.1				74.0				106.6				75.7				960.5
Southern Region				680.3				(76.9	)			603.4				62.8				107.5				69.9				865.6
Southwestern Region				332.6				(31.2	)			301.4				28.7				50.2				28.9				409.4
Western Region				729.4				(143.9	)			585.5				46.2				148.8				51.4				813.2
Corporate Entities(a)				.2				—				.2				3.7				(71.7	)			6.6				678.5
	Total		$	3,014.4			$	(496.6	)		$	2,517.8			$	251.8			$	412.7			$	273.2			$	4,554.1

															Depreciation,
															Amortization,				Other
			Gross				Intercompany				Net				and				Charges				Operating				Capital				Total
2002			Revenue				Revenue(b)				Revenue				Depletion(c)				(Income)				Income				Expenditures(d)				Assets
Eastern Region			$	564.1			$	(79.7	)		$	484.4			$	32.0			$	(4.1	)		$	87.0			$	39.2			$	822.2
Central Region				589.6				(120.2	)			469.4				53.6				(1.5	)			105.3				77.1				950.9
Southern Region				643.1				(65.5	)			577.6				52.7				—				118.3				58.0				830.7
Southwestern Region				311.8				(29.1	)			282.7				22.8				—				41.9				30.6				374.6
Western Region				690.0				(139.1	)			550.9				41.3				—				145.5				47.3				826.7
Corporate Entities(a)				.2				(.1	)			.1				(2.8	)			—				(38.5	)			6.4				404.0
	Total		$	2,798.8			$	(433.7	)		$	2,365.1			$	199.6			$	(5.6	)		$	459.5			$	258.6			$	4,209.1

(a)	Corporate functions include legal, tax, treasury, information technology, risk management, human resources, national accounts and other typical administrative functions. The increase in operating income for Corporate Entities from 2003 to 2004 is due primarily to higher self-insurance expense recorded during 2003.
(b)	Intercompany operating revenue reflects transactions within and between segments and are generally made on a basis intended to reflect the market value of such services.
(c)	Effective January 1, 2003, the Company adopted SFAS 143. (See Note 1, Basis of Presentation, for further information.)
(d)	Capital expenditures for 2002 exclude $72.6 million used to purchase equipment consisting primarily of revenue-producing vehicles originally placed into service pursuant to an operating lease.

			Balance as of												Balance as of
			December 31,												December 31,
			2003				Acquisitions				Transfers				2004
Eastern Region			$	435.9			$	2.6			$	(2.1	)		$	436.4
Central Region				350.5				10.7				(3.6	)			357.6
Southern Region				325.8				2.0				(1.3	)			326.5
Southwestern Region				135.0				.2				(1.6	)			133.6
Western Region				310.9				(2.3	)			—				308.6
	Total		$	1,558.1			$	13.2			$	(8.6	)		$	1,562.7

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															Cumulative Effect
			Balance as of												of Changes in				Balance as of
			December 31,												Accounting				December 31,
			2002				Acquisitions				Divestitures				Principles				2003
Eastern Region			$	429.0			$	7.2			$	(.3	)		$	—			$	435.9
Central Region				343.0				7.5				—				—				350.5
Southern Region				323.2				2.6				—				—				325.8
Southwestern Region				134.7				.3				—				—				135.0
Western Region				314.3				3.6				—				(7.0	)			310.9
	Total		$	1,544.2			$	21.2			$	(.3	)		$	(7.0	)		$	1,558.1

				Years Ended December 31,
				2004				2003				2002
Collection:
	Residential			$	655.2			$	601.2			$	530.7
	Commercial				737.9				706.0				696.7
	Industrial				558.1				523.0				501.6
	Other				62.2				50.9				50.8
		Total collection			2,013.4				1,881.1				1,779.8
Transfer and disposal					1,031.0				967.5				854.1
Less: Intercompany					(519.8	)			(493.7	)			(428.5	)
	Transfer and disposal, net				511.2				473.8				425.6
Other					183.5				162.9				159.7
		Revenue		$	2,708.1			$	2,517.8			$	2,365.1

11.	FUEL HEDGE

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12.	COMMITMENTS AND CONTINGENCIES

Years Ending
December 31,
2005		$	4.1
2006			3.1
2007			2.8
2008			1.6
2009			1.3
Thereafter			5.6
		$	18.5

Years Ending
December 31,
2005		$	27.6
2006			9.9
2007			2.0
2008			1.4
2009			1.4
Thereafter			11.8
		$	54.1

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13.	RELATED PARTY TRANSACTIONS

14.	QUARTERLY FINANCIAL INFORMATION (UNAUDITED)

						First				Second				Third				Fourth
						Quarter				Quarter				Quarter				Quarter
Revenue			2004			$	637.3			$	683.2			$	699.9			$	687.7
			2003			$	594.6			$	637.3			$	648.0			$	637.9
Operating income			2004			$	110.0			$	116.2			$	116.5			$	109.6
			2003			$	105.4			$	113.5			$	87.3			$	106.5
Income before cumulative effect of changes in accounting principles			2004			$	56.9			$	60.9			$	62.5			$	57.6
			2003			$	54.6			$	60.4			$	44.7			$	55.7
Net income			2004			$	56.9			$	60.9			$	62.5			$	57.6
			2003			$	16.8			$	60.4			$	44.7			$	55.7
Diluted income per share before cumulative effect of changes in accounting principles			2004			$	.36			$	.39			$	.41			$	.38
			2003			$	.33			$	.37			$	.28			$	.35
Diluted net income per share			2004			$	.36			$	.39			$	.41			$	.38
			2003			$	.10			$	.37			$	.28			$	.35
Weighted average common and common equivalent shares outstanding			2004				158.4				155.7				153.8				153.5
			2003				163.3				162.5				162.2				160.5

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15.	SUBSEQUENT EVENT

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ITEM  9.	CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

ITEM  9A.	CONTROLS AND PROCEDURES

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ITEM  9B.	OTHER INFORMATION

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ITEM 12.	SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

Number of

Securities Remaining

Number of

Available for

Securities to be

Future Issuance

Issued Under

Weighted-Average

Under Equity

Exercise of

Exercise Price of

Compensation Plans

Outstanding

Outstanding

Excluding Securities

Options, Warrants

Options, Warrants

Reflected in

Plan Category

and Rights

and Rights

Column A

Equity compensation plans approved by security holders

11.1

$

18.51

6.0

Equity compensation plans not approved by security holders

—

—

—

Total

11.1

$

18.51

6.0

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ITEM 15.	EXHIBITS AND FINANCIAL STATEMENT SCHEDULE

	1. All Financial Statements:

	The following financial statements are filed as part of this report under Item 8 — Financial Statements and Supplementary Data.

		Page
Report of Independent Registered Public Accounting Firm on the Financial Statements			51
Report of Independent Registered Public Accounting Firm on Internal Control over Financial Reporting			52
Consolidated Balance Sheets as of December 31, 2004 and 2003			53
Consolidated Statements of Income for each of the Three Years Ended December 31, 2004			54
Consolidated Statements of Stockholders’ Equity and Comprehensive Income for each of the Three Years Ended December 31, 2004			55
Consolidated Statements of Cash Flows for each of the Three Years Ended December 31, 2004			56
Notes to Consolidated Financial Statements			57

	2. Financial Statement Schedules:

	Schedule II — Valuation and Qualifying Accounts and Reserves, for each of the Three Years Ended December 31, 2004, 2003 and 2002.
	All other schedules are omitted as the required information is not applicable or the information is presented in the Consolidated Financial Statements and Notes thereto in Item 8 above.

	3. Exhibits:

The following exhibits are filed herewith or are incorporated by reference to exhibits previously filed with the Commission, as indicated in the description of each. We agree to furnish to the Commission upon request a copy of any instrument with respect to long-term debt not filed herewith as to which the total amount of securities authorized thereunder does not exceed 10 percent of our total assets on a consolidated basis.

Exhibit
Number						Description of Exhibit
	3.1			—		Amended and Restated Certificate of Incorporation (incorporated by reference to Exhibit 3.1 of the Company’s Quarterly Report on Form 10-Q for the period ended June 30, 1998).
	3.2			—		Certificate of Amendment to Amended and Restated Certificate of Incorporation of Republic Services, Inc. (incorporated by reference to Exhibit 4.2 of the Company’s Registration Statement on Form S-8, Registration No. 333-81801, filed with the Commission on June 29, 1999).
	3.3			—		Amended and Restated Bylaws of Republic Services, Inc. (incorporated by reference to Exhibit 3.2 of the Company’s Quarterly Report on Form 10-Q for the period ended June 30, 1998).
	4.1			—		Republic Services, Inc. Common Stock Certificate (incorporated by reference to Exhibit 4.4 of the Company’s Registration Statement on Form S-8, Registration No. 333-81801, filed with the Commission on June 29, 1999).

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Exhibit
Number						Description of Exhibit
	4.2			—		Long Term Credit Agreement dated July 3, 2002 among Republic Services, Inc., Bank of America N.A. as Administrative Agent, and the several financial institutions party thereto (incorporated by reference to Exhibit 4.2 of the Company’s Annual Report on Form 10-K for the year ended December 31, 2002).
	4.3			—		Indenture dated May 24, 1999 by Republic Services, Inc. to The Bank of New York, as trustee (incorporated by reference to Exhibit 4.3 of the Company’s Annual Report on Form 10-K for the year ended December 31, 1999).
	4.4			—		65/8% Note due May 15, 2004 in the principal amount of $200,000,000 (incorporated by reference to Exhibit 4.4 of the Company’s Annual Report on Form 10-K for the year ended December 31, 1999).
	4.5			—		65/8% Note due May 15, 2004 in the principal amount of $25,000,000 (incorporated by reference to Exhibit 4.5 of the Company’s Annual Report on Form 10-K for the year ended December 31, 1999).
	4.6			—		71/8% Note due May 15, 2009 in the principal amount of $200,000,000 (incorporated by reference to Exhibit 4.6 of the Company’s Annual Report on Form 10-K for the year ended December 31, 1999).
	4.7			—		71/8% Note due May 15, 2009 in the principal amount of $175,000,000 (incorporated by reference to Exhibit 4.7 of the Company’s Annual Report on Form 10-K for the year ended December 31, 1999).
	4.8			—		Indenture dated as of August 15, 2001, by Republic Services, Inc. to The Bank of New York, as trustee (incorporated by reference to Exhibit 4.1 of the Company’s Current Report on Form 8-K dated August 9, 2001).
	4.9			—		First Supplemental Indenture, dated as of August 15, 2001 by Republic Services, Inc. to The Bank Of New York, as trustee (incorporated by reference to Exhibit 4.2 of the Company’s Current Report on Form 8-K dated August 9, 2001).
	4.10			—		63/4% Senior Note due 2011, in principal amount of $400,000,000 (incorporated by reference to Exhibit 4.4 of the Company’s Current Report on Form 8-K dated August 9, 2001).
	4.11			—		63/4% Senior Note due 2011, in principal amount of $50,000,000 (incorporated by reference to Exhibit 4.4 of the Company’s Current Report on Form 8-K dated August 9, 2001).
	10.1			—		Separation and Distribution Agreement dated June 30, 1998 by and between Republic Services, Inc. and AutoNation, Inc. (then known as Republic Industries, Inc.) (incorporated by reference to Exhibit 10.1 of the Company’s Quarterly Report on Form 10-Q for the period ended June 30, 1998).
	10.2			—		Tax Indemnification and Allocation Agreement dated June 30, 1998 by and between Republic Services, Inc. and AutoNation, Inc. (then known as Republic Industries, Inc.) (incorporated by reference to Exhibit 10.4 of the Company’s Quarterly Report on Form 10-Q for the period ended June 30, 1998).
	10.3			—		Republic Services, Inc. 1998 Stock Incentive Plan (as amended and restated March 6, 2002) (incorporated by reference to Exhibit 10.1 of the Company’s Quarterly Report on Form 10-Q for the period ended March 31, 2002).*
	10.4			—		Employment Agreement dated October 25, 2000 by and between James E. O’Connor and Republic Services, Inc. (incorporated by reference to Exhibit 10.7 of the Company’s Annual Report on Form 10-K for the year ended December 31, 2000).*
	10.5			—		Employment Agreement dated October 25, 2000 by and between Tod C. Holmes and Republic Services, Inc. (incorporated by reference to Exhibit 10.9 of the Company’s Annual Report on Form 10-K for the year ended December 31, 2000).*
	10.6			—		Employment Agreement dated October 25, 2000 by and between David A. Barclay and Republic Services, Inc. (incorporated by reference to Exhibit 10.10 of the Company’s Annual Report on Form 10-K for the year ended December 31, 2000).*

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Exhibit
Number						Description of Exhibit
	10.7			—		Employment Agreement dated July 31, 2001 by and between Harris W. Hudson and Republic Services, Inc. (incorporated by reference to Exhibit 10.8 of the Company’s Annual Report on Form 10-K for the year ended December 31, 2001).*
	10.8			—		Employment Agreement dated May 14, 2001 by and between Michael Cordesman, who became an executive officer in March 2002, and Republic Services, Inc. (incorporated by reference to Exhibit 10.1 of the Company’s Quarterly Report on Form 10-Q, for the period ended March 31, 2002).*
	21.1			—		Subsidiaries of the Company (filed herewith).
	23.1			—		Consent of Ernst & Young (filed herewith).
	31.1			—		Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer (filed herewith).
	31.2			—		Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Officer (filed herewith).
	32.1			—		Section 1350 Certification of Chief Executive Officer (filed herewith).
	32.2			—		Section 1350 Certification of Chief Financial Officer (filed herewith).

*	Indicates a management contract or compensatory plan, contract or arrangement.

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	REGISTRANT:
	REPUBLIC SERVICES, INC.

	By:	/s/JAMES E. O’CONNOR

	James E. O’Connor
	Chairman of the Board and Chief Executive Officer
	(principal executive officer)

Signature				Title		Date
/s/ James E. O’Connor   James E. O’Connor				Chairman of the Board and Chief Executive Officer (principal executive officer)		February 25, 2005
/s/ Harris W. Hudson   Harris W. Hudson				Vice Chairman and Director		February 25, 2005
/s/ Tod C. Holmes   Tod C. Holmes				Senior Vice President and Chief Financial Officer (principal financial officer)		February 25, 2005
/s/ Charles F. Serianni   Charles F. Serianni				Vice President and Chief Accounting Officer (principal accounting officer)		February 25, 2005
/s/ John W. Croghan   John W. Croghan				Director		February 25, 2005
/s/ W. Lee Nutter   W. Lee Nutter				Director		February 25, 2005
/s/ Ramon A. Rodriguez   Ramon A. Rodriguez				Director		February 25, 2005
/s/ Allan C. Sorensen   Allan C. Sorensen				Director		February 25, 2005
/s/ Michael W. Wickham   Michael W. Wickham				Director		February 25, 2005

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			Balance at				Additions				Accounts								Balance at
			Beginning				Charged to				Written								End
			of Year				Income				Off				Other(1)				of Year
CLASSIFICATIONS
Allowance for doubtful accounts:
	2004		$	19.0			$	8.0			$	(9.0	)		$	—			$	18.0
	2003			19.0				10.4				(10.4	)			—				19.0
	2002			19.0				11.2				(11.4	)			.2				19.0

(1)	Allowance of acquired and divested businesses, net.

94

 

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	/s/ Ernst & Young LLP
	Certified Public Accountants

95

 

	a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
	b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.
	c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
	d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

	a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
	b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

96

 

	a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
	b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.
	c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
	d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

	a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
	b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

97

 

98

 

99