5.GOODWILL AND INTANGIBLE ASSETS, NET

The Company tests goodwill for impairment annually in the fourth quarter of the year and whenever events or changes in circumstances indicate the carrying value of goodwill and/or indefinite-lived intangible assets may not be recoverable. In the first step (“Step 1”) of testing for goodwill impairment, the Company estimates the fair value of each reporting unit, which consists of its three geographic operating segments and its E&P segment, and compares the fair value with the carrying value of the net assets assigned to each reporting unit. If the fair value of a reporting unit is greater than the carrying value of the net assets, including goodwill, assigned to the reporting unit, then no impairment results. If the fair value is less than its carrying value, then the Company would perform a second step and determine the fair value of the goodwill. In this second step (“Step 2”), the fair value of goodwill is determined by deducting the fair value of a reporting unit’s identifiable assets and liabilities from the fair value of the reporting unit as a whole, as if that reporting unit had just been acquired and the purchase price were being initially allocated. If the fair value of the goodwill is less than its carrying value for a reporting unit, an impairment charge is recorded to Impairments and other operating charges in the Condensed Consolidated Statements of Net Income (Loss).

During the third quarter of 2015, the Company determined that sufficient indicators of potential impairment existed to require an interim goodwill and indefinite-lived intangible assets impairment analysis for its E&P segment as a result of the sustained decline in oil prices in the recent months, together with market expectations of a likely slow recovery in such prices. The Company, therefore, performed an interim Step 1 assessment of its E&P segment during the third quarter of 2015. The Step 1 assessment involved measuring the recoverability of goodwill by comparing the E&P segment’s carrying amount, including goodwill, to the fair value of the reporting unit. The fair value was estimated using an income approach employing a discounted cash flow (“DCF”) model. The DCF model incorporated projected cash flows over a forecast period based on the remaining estimated lives of the operating locations comprising the E&P segment. This was based on a number of key assumptions, including, but not limited to, a discount rate of 11.6%, annual revenue projections based on E&P waste resulting from projected levels of oil and natural gas exploration and production activity during the forecast period, gross margins based on estimated operating expense requirements during the forecast period and estimated capital expenditures over the forecast period, all of which were classified as Level 3 in the fair value hierarchy. As a result of the Step 1 assessment, the Company determined that the E&P segment did not pass the Step 1 test because the carrying value exceeded the estimated fair value of the reporting unit. The Company then performed the Step 2 test to determine the fair value of goodwill for its E&P segment. Based on the Step 1 and Step 2 analyses, the Company recorded a goodwill impairment charge within its E&P segment of $411,786 during the three months ended September 30, 2015. Following the impairment charge, the Company’s E&P segment has a remaining balance in goodwill of $77,343 at September 30, 2015.

Prior to conducting the first step of the goodwill impairment test for the E&P segment, the Company first evaluated the recoverability of its long-lived assets, including finite-lived intangible assets. When indicators of impairment are present, the Company tests long-lived assets for recoverability by comparing the carrying value of an asset group to its undiscounted cash flows. The Company considered the sustained decline in oil prices in the recent months, together with market expectations of a likely slow recovery in such prices, to be indicators of impairment for the E&P segment’s long-lived assets. Based on the result of the recoverability test, the Company determined that the carrying value of certain asset groups within the E&P segment exceeded their undiscounted cash flows and were therefore not recoverable. The Company then compared the fair value of these asset groups to their carrying values. The Company estimated the fair value of the asset groups under an income approach, as described above. Based on the analysis, the Company recorded an impairment charge to Impairments and other operating charges in the Condensed Consolidated Statements of Net Income (Loss) on certain long-lived assets within its E&P segment of $63,928 during the three months ended September 30, 2015. Following the impairment charge, the Company’s E&P segment has a remaining balance in property, plant and equipment of $931,180 at September 30, 2015.

Additionally, the Company evaluated the recoverability of the E&P segment’s indefinite-lived intangible assets (other than goodwill) by comparing the estimated fair value of each indefinite-lived intangible asset to its carrying value. The Company estimated the fair value of the indefinite-lived intangible assets using an excess earnings approach. Based on the result of the recoverability test, the Company determined that the carrying value of certain indefinite-lived intangible assets within the E&P segment exceeded their fair value and were therefore not recoverable. The Company recorded an impairment charge to Impairments and other operating charges in the Condensed Consolidated Statements of Net Income (Loss) on certain indefinite-lived intangible assets within its E&P segment of $38,300 during the three months ended September 30, 2015. Following the impairment charge, the Company’s E&P segment has a remaining balance in indefinite-lived intangible assets of $21,555 at September 30, 2015.

Intangible assets, exclusive of goodwill, consisted of the following at September 30, 2015:


	Gross Carrying Amount		Accumulated Amortization			Accumulated Impairment Loss	Net Carrying Amount
Finite-lived intangible assets:
Long-term franchise agreements and contracts	$	199,290	$	(58,299)	$	-	$	140,991
Customer lists		165,533		(92,076)		-		73,457
Permits and non-competition agreements		78,440		(13,078)		-		65,362
		443,263		(163,453)		-		279,810
Indefinite-lived intangible assets:
Solid waste collection and transportation permits		152,761		-		-		152,761
Material recycling facility permits		42,283		-		-		42,283
E&P facility permits		59,855		-		(38,300)		21,555
		254,899		-		(38,300)		216,599
Intangible assets, exclusive of goodwill	$	698,162	$	(163,453)	$	(38,300)	$	496,409

The weighted-average amortization period of long-term franchise agreements and contracts acquired during the nine months ended September 30, 2015 was 9.8 years. The weighted-average amortization period of customer lists acquired during the nine months ended September 30, 2015 was 7.2 years. The weighted-average amortization period of finite-lived permits acquired during the nine months ended September 30, 2015 was 38.1 years.

Intangible assets, exclusive of goodwill, consisted of the following at December 31, 2014:


	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Finite-lived intangible assets:
Long-term franchise agreements and contracts	$	195,676	$	(52,448)	$	143,228
Customer lists		161,463		(77,931)		83,532
Permits and non-competition agreements		41,369		(11,777)		29,592
		398,508		(142,156)		256,352
Indefinite-lived intangible assets:
Solid waste collection and transportation permits		151,505		-		151,505
Material recycling facility permits		42,283		-		42,283
E&P facility permits		59,855		-		59,855
		253,643		-		253,643
Intangible assets, exclusive of goodwill	$	652,151	$	(142,156)	$	509,995

Estimated future amortization expense for the next five years relating to finite-lived intangible assets is as follows:


For the year ending December 31, 2015	$	28,658
For the year ending December 31, 2016	$	25,152
For the year ending December 31, 2017	$	23,099
For the year ending December 31, 2018	$	22,179
For the year ending December 31, 2019	$	17,591