BILL ANALYSIS Ó
AB 180
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Date of Hearing: May 13, 2015
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Jimmy Gomez, Chair
AB
180 (Bonilla) - As Amended April 22, 2015
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Urgency: No State Mandated Local Program: NoReimbursable: No
SUMMARY:
This bill requires the powers and duties of the Cemetery and
Funeral Bureau (Bureau) be reviewed by the appropriate policy
committees of the Legislature, before January 1, 2020, and
requires the Bureau to conduct a study of endowment care funds
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as specified, by November 1, 2018.
FISCAL EFFECT:
The Bureau operates as a single entity from two separate special
funds, the Cemetery Fund (Cemetery) and the Funeral Directors
and Embalmers Fund (Funeral). The funds are both supported by
fees from licensees, are solvent, and have reserves.
On-going annual Special Fund costs of approximately of
approximately $2.5 million (Cemetery) and $1.8 million (Funeral)
for operating and personnel expenses including enforcement,
licensing, auditing and administrative functions. This fund is
self-supporting with fee revenue.
COMMENTS:
1)Purpose. This bill is one of five author-sponsored sunset
bills. According to the author, "Although the Bureau is
subject to sunset review, and was subject to a sunset review
oversight hearing on March 18, 2015, its statutory provisions
do not contain a sunset review provision. This bill seeks to
make clear that the Bureau is subject to sunset review, and to
reinforce the recommendations contained in the Bureau's sunset
review report, including a review of endowment care funds, in
order to increase accountability."
This bill will authorize the continued operation of the Bureau
as it is currently functioning under the Department of
Consumer Affairs (DCA) and request the Bureau to be reviewed
by the Legislature again in four years. By continuing the
functions of the Bureau, this bill will allow the Bureau to
continue in its regulatory capacity for the protection of
consumers and the regulation of all aspects of the funeral and
cemetery industries.
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2)Background. The Bureau licenses and regulates more than
11,000 licensees in 13 different licensing categories. The
Bureau does not license or regulate cemeteries operated by
religious organizations, cities, counties, cemetery districts,
the military, Native American tribal organizations, or other
groups. The Bureau has the oversight responsibility for both
fiduciary and operational activities of its licensing
population and has the statutory authority to enforce the
licensing and practice acts dealing specifically with human
remains, cemetery, and crematory provisions. The Bureau
currently employees 21.5 full and part time positions.
3)Endowment Care Funds. Current law requires cemeteries to file
an annual report regarding the amount collected for endowment
care funds and special care funds (preneed cemetery
merchandise and services), the manner of investment of the
funds, as well as other financial information and related
documents. The annual report must be submitted with an audit
report signed by a certified public accountant. The Bureau's
audit unit reviews the annual reports and assesses any
potential risk to the funds. In 2008, the Bureau reported to
the Legislature the results from its Endowment Care Fund
Survey, which addressed the need to increase endowment care
fund requirements. While an increase in funding for endowment
care was enacted in 2008, it was recommended in the background
paper that the Bureau conduct an updated study on endowment
care fund requirements and needs. This bill will require the
Bureau to conduct a study of endowment care funds and report
back to the Legislature by November 1, 2018.
4)Previous Legislation.
a) SB 658 (Negrete McLeod), Chapter 386, Statutes of 2011,
required funeral establishments to make their general price
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list available by mail, facsimile, or electronic mail, or
to post that information on its Internet Web site, as
specified, by January 1, 2013.
b) AB 2946 (Hayashi), Chapter 504, Statutes of 2008,
deleted the December 31, 2007, sunset date of, thereby
extending indefinitely, the $8.50 quarterly fee the Bureau
charges cemeteries for each burial, entombment, inurnment,
or cremation made during the preceding quarter.
c) SB 363 (Figueroa), Chapter 874, Statutes of 2003,
implemented changes to several boards and commissions,
including the Bureau, within the DCA.
d) SB 1952 (Figueroa) Chapter 825, Statutes of 2002,
required the Bureau to report to the Legislature on certain
specified topics; extended the sunset date requiring
cemetery authorities and crematories to pay a fee of $8.50
per cremation, burial, entombment or inurnment; authorized
the Bureau to assess a fee for developing, purchasing,
grading, and administering the cemetery manager and
crematory manager examinations; and made other changes
regulating the Bureau pursuant to recommendations of the
JLSRC and DCA.
Analysis Prepared by:Jennifer Swenson / APPR. / (916)
319-2081
AB 180
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