Solid Waste Management is one of the critical environmental challenges for quick urban developing countries. It involves a number of problems that requires optimization techniques for better decision making. These include the selection of collection points, disposal sites, and vehicle routing mechanisms. This paper addresses the problem of optimization of solid waste systems which involves the use of composting plants as a strategy in environmental management. A mathematical programming model is developed and tested on real data from Ilala Municipal in Dar es Salaam Tanzania. The formulated model resulted into lower transportation cost from sources to collection points, composting plant and landfill compared to previous results. Furthermore, it has been observed that construction of composting plants can provide extra income through sales of recyclable materials and compost manure and thereby reduce the overall system’s running cost.