RSG

-- Issuer Default Rating (IDR) at 'BBB-';

-- Senior unsecured credit facility at 'BBB-';

-- Senior unsecured at 'BBB-'.

Allied Waste Industries, Inc. (AW)

-- IDR at 'BBB-';

-- Senior subordinated at 'BB+'.

Allied Waste North America (AWNA)

-- IDR at 'BBB-';

-- Senior unsecured at 'BBB-'.

Browning-Ferris Industries (BFI)

-- IDR at 'BBB-';

-- Senior unsecured at 'BBB-'.

Fitch's ratings apply to $5.7 billion in notes and debentures and two unsecured revolving credit facilities with a combined capacity of $2.75 billion. Fitch has revised the Rating Outlook for RSG and its subsidiaries to Positive from Stable.

RSG's ratings reflect the waste services company's significant free cash flow generation potential and financial flexibility, offset somewhat by a heavy debt load following last year's merger with AW. However, RSG's debt level has declined materially since the merger was completed in December 2008, and Fitch expects debt to decline further over the next several years as leverage reduction remains the company's top priority for free cash flow deployment. In addition, although waste industry volumes have weakened over the past year, RSG, along with the other major industry participants, continues to realize margin growth due to a combination of ongoing pricing gains and cost discipline. The Outlook revision to Positive reflects Fitch's expectations that RSG's credit profile will continue to strengthen over the next several years as the company realizes merger-related efficiencies and uses its strong free cash flow to further reduce its debt balance.

Fitch downgraded RSG's IDR to 'BBB-' from 'BBB+' last December when the merger with AW was completed. (Concurrently, Fitch upgraded AW's IDR to 'BBB-' from 'B+'.) The downgrade was due primarily to the addition of AW's $6.5 billion debt load to RSG's capital structure, which drove a significant increase in RSG's EBITDA leverage from about 2 times (x) pre-merger to over 3x (including an estimate of AW's 12-months EBITDA) after the merger was closed. From the time the merger was initially announced in June 2008, however, the company's management has consistently stated that leverage reduction is the company's top priority, with a goal of driving leverage down to RSG's pre-merger level over the next two to three years.

Demonstrating that leverage reduction is a priority, management stopped the company's share repurchase program in mid-2008 in order to build liquidity that could be used to reduce debt. This was significant, given that RSG had repurchased a total of $855 million in shares in 2006 and 2007 combined. In addition to the free cash flow that has been redirected away from the share repurchase program, RSG has also used cash proceeds from asset sales required by the U.S. Department of Justice (DOJ) to fund debt reduction, as well. As of June 30 2009, RSG had received $425 million in pre-tax proceeds from DOJ-required asset sales, all of which had been used to reduce debt.

Through the use of both asset sale proceeds and free cash flow, RSG reduced its outstanding debt balance by over $600 million in the first six months of 2009.