K.L. Brown bill would stiffen penalties on funeral home cheaters
by Tim Lockette
tlockette@annistonstar.com
Jan 03, 2013 | 6830 views |  0 comments | 14 14 recommendations | email to a friend | print
MONTGOMERY — Last month, Koven L. Brown arranged the funeral of a Calhoun County resident who paid for the service back in the 1990s.

“We lost money on that,” said Brown, director of K.L. Brown Funeral Home in Jacksonville. “About $3,000. But you do it because that’s what people need.”

For years, Brown has sold “pre-need” funeral arrangements — essentially funeral packages paid for in advance — to local residents. Now, in his role as a member of the state House of Representatives, the Jacksonville Republican is proposing tougher penalties on funeral home directors who mismanage that pre-need money, or just take it and run.

Brown has filed a bill that would make it a felony for funeral home workers to fail to deposit pre-need payments in a trust, or withdraw it for a reason not related to the pre-need contract. Under a pre-need funeral law passed 10 years ago, mismanaging that money is a misdemeanor.

“We need to make the penalties a little stronger for those who choose to steal people’s money,” he said.

Brown said pre-need funeral arrangements are common across the country. It’s not unusual, he said, for people to have their gravesites reserved and headstones in place years before they die.

It’s sometimes a losing proposition for funeral homes because the cost of the services purchased rises faster than the value of the pre-paid or pre-arranged payment. Brown said that even when it’s not a money-maker, funeral homes provide pre-need sales as a service to the community.

And they can make up that cost — though it might take decades.

“The flip side is that it guarantees that the family will use the same funeral home in the future,” he said.

Still, Brown said, a handful of funeral home directors will take the money and refuse to deliver the product, or use the money for other purposes while it’s in their care. Those people are rare, he said, but they damage the profession’s reputation.

“Most of us know that pre-need is not our money, it’s the family’s money,” he said.

Brown’s 70-page bill, thick with funeral home jargon, also sets up new rules for how that pre-need money can be held in trust, and for state audits to make sure funeral homes are honoring their promises.

Brown filed virtually the same bill last year but the session ended before the bill could come up for a final vote. Part of the holdup, Brown said, was opposition from a single, nonprofit cemetery in Mobile.

“We didn’t think it was fair to exempt municipal and church cemeteries and not exempt us,” said Tim Claiborne, president of Mobile Memorial Gardens.

Mobile Memorial is a cemetery that was founded in 1953 on 200 acres in Mobile. The cemetery is run like a business, but as a nonprofit — 501(c)(13), specifically — it folds any proceeds into upkeep of the grounds. Claiborne said Brown’s 2012 bill exempted church and city cemeteries from the bill, but didn’t do the same for Mobile Memorial, the only cemetery of its kind in the state.

Claiborne said he welcomed tougher penalties on funeral home directors who cheat, but didn’t think it was fair to impose added auditing and other restrictions on Mobile Memorial.

Brown said that to get the bill passed, he altered the bill to make any 501(c)(13) entity exempt.

“It kind of makes me sick at my stomach to exempt anybody,” he said. “But sometimes you have to accept a bill that was less than you wanted to get a bill at all.”

Brown’s bill will come before the House sometime after the start of the legislative session on Feb. 5.

Capitol & statewide correspondent: 256-294-4193. On Twitter @TLockette_Star.

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