Senate Bills 534 and 535 (Enrolled

Contact: Office of Policy and Legislative Affairs

Agency: Licensing and Regulatory Affairs

Analysis

Topic: Cemeteries
Sponsor: Senator Stille
Date Introduced: June 12, 2001
Date Ordered Enrolled: July 9, 2002
Date of Analysis: July 8, 2002

Position: The Michigan Department of Consumer and Industry Services supports the bill.

Background: Although it has not been necessary to do so very often, a conservator or receiver sometimes has been appointed by the courts to oversee operations at cemeteries with serious compliance problems. The problem with this approach is that once the receiver has restored the cemetery's financial health the receiver must return the cemetery to the owner who originally violated the law. The act does not authorize the cemetery property and assets to be sold to another party.

The bills were introduced at the request of the Department of Consumer and Industry Services as a result of a lengthy regulatory action against a West Michigan cemetery. The cemetery in question was located in Senator Stille's district and generated over 100 consumer complaints to his office and the department.

Bill Content: Senate Bill 534 permits a receiver or conservator appointed by the court to sell, assign, transfer, or convey the cemetery to a municipal corporation or other person. The Senate adopted a substitute that prohibited the sale, assignment, transfer, or conveyance of the cemetery to the holder of a mortuary science license or a person who directly or indirectly owns, manages, supervises, operates, or maintains a funeral establishment.

Senate Bill 535 permits the transfer of a cemetery under receivership or conservatorship to be transferred to a municipal corporation in which the cemetery is located pursuant to a court order without a resolution of the governing body.

Arguments For: It is important for the department to have the ability to petition the court to appoint a receiver or conservatory who will not be required to return a problem cemetery to the owner. A recent case in western Michigan required over three years to resolve. If a receiver would have had the authority to turn the cemetery over to another person or a municipality, the department would have requested the court to appoint a receiver and the case would have been resolved much more quickly. In most cases it is expected that the threat of a receiver who would have the authority to dispose of the cemetery to another person or a municipality will be sufficient to cause the owner to come up with the money to meet his or her obligations under the law. The need for a receiver or conservator is one that the department has had to resort to rarely, but it's very important to have such a regulatory tool available.

Arguments Against: The bills will provide little help in addressing the financial problems of small cemeteries. Private buyers are unlikely to be very interested in buying such cemeteries from a conservator or receiver, and most municipalities consider cemeteries as money-losing propositions. One Michigan cemetery has been in receivership for over 20 years.

Supporters/Opponents: The Michigan Cemetery Association supports the bills. There was no opposition.

Fiscal Information: The bilsl will have no fiscal impact on the department.

Administrative Rules Impact: The bills will not require new or revised administrative rules.