The cemetery operators to whom these funds have been entrusted have not always been as scrupulously honest in their stewardship as one might hope. The itinerant promoter who moves his sales crew into a community to saturate it with pre-need sales is hardly the type one would expect to sit around and wait for his sold-out cemetery to fill up, much less wait forever to lavish perpetual care upon it. And when he moves on to the next community, he has not always been able to resist the temptation to take the perpetual care fund with him—for safekeeping, of course, or at least to dip into it for a loan at low interest to purchase new cemetery property. After all, the money is there to be invested.

A fund of over $20 billion, available for investment at the discretion of cemetery owners, can serve as a powerful political weapon. Only after the misappropriation of funds became a public scandal did a few state legislatures begin to impose legal controls on the investment of cemetery trust funds. The potent cemetery lobby (it is the envy of the funeral directors, who carry less weight in the state legislatures) has contrived to secure laws that are not unduly burdensome, and in some states the regulation of perpetual care funds is placed under the benign authority of a board composed entirely of cemetery owners.

Municipal cemeteries are operated as a public service and are often partially subsidized by public funds. Since they do not as a rule advertise, or send salesmen out on commission, they are able to offer cemetery space and services at moderate cost.

What happens when, for the first time, commercial cemeteries move into a community where there is already a municipal cemetery? A sales team blankets the community, sells pre-need lots at from three to ten times the price charged by the municipal cemetery, which has no advertising or pre-need promotion budget. The reaction of the city fathers is likely to be, “Now that sufficient burial space is available from a private source, why spend money to operate a municipal cemetery?” or, “Let’s raise our rates and make it self-supporting—if they can do it, why can’t we?” In the latter case, the municipal cemetery gets itself an advertising appropriation, perhaps hires a crew of pre-need salesmen, and up go the charges correspondingly.

Cemetery men have also found in pre-need selling a means of cutting themselves into the veterans’ market, a source of business from which they would be excluded by the federal laws which give veterans and their wives the privilege of burial in national cemeteries without charge. Pre-need selling enables the cemetery man to outflank the undertaker. He gets into the home first—years ahead of the undertaker, in fact—seduces the family with his glossy catalogues, and points out that the veteran’s $300 burial allowance can be applied to the cost of the grave. That one must die in a VA hospital or nursing home to qualify may never get mentioned.

Pre-need cemetery promoters, in considering whether a particular community is ripe for exploitation, are least of all concerned about whether there is a deficiency of cemetery space. All they want and need to know is how often the town has been previously canvased by pre-need salesmen, and how many householders already own cemetery lots. Consequently, duplication of cemetery facilities goes on apace. Once, in hearings on a cemetery application in Los Angeles, there was testimony from numerous sources that there already existed sufficient cemetery facilities to handle all burials in the Los Angeles area for the next hundred years.

Having saturated a community with pre-need graves, crypts, vaults, and memorials, and having established a perpetual care fund the control of which is firmly under his thumb, how next can the cemetery promoter cash in on his privileged position? It should surprise no one who has come this far that men of vision in the industry have already looked ahead and come up with the ultimate solution: a prepaid package that will include not only burial space and marker but “casket,” hearse, undertaking services, and flower shop as well.

We have seen that funeral home charges are today eight to ten times what they were thirty years ago. And while cemetery prices have increased correspondingly, the leap in profitability has been nothing short of spectacular. SCI, for example, reported a profit margin of 34 percent for its cemetery operations in 1995, a performance which would do credit to any corporation in the Fortune 500, compared with a still robust 22 percent for its funeral establishments. And the cemeteries in North America that yield the highest returns are those, like Forest Lawn, that have self-contained mortuaries and flower shops. It is these that the corporate consolidators scramble for most avidly, leading to bidding contests that some securities analysts consider rash.

By any standard, it has not been a great public relations year for cemeterians. In California, recent headlines have widely spread the story of grim violations at numerous prominent cemeteries, including disinterment, multiple burials, non-maintenance, and fraud/embezzlement. Now comes New York, where the controversy has taken a new direction and focused not so much on cemetery maintenance, but on ownership policy and marketing practices.

Under New York law, cemeteries are not-for-profit enterprises, regulated in part to help ensure that sufficient money is set aside for perpetual care. The current debate therefore centers on the following questions: Is it proper, then, to allow funeral homes, established to make money, to acquire an interest in cemeteries? And could pressures for profit this year endanger the sanctity of care in the years to come? The State Cemetery Board held a hearing in Albany last week to address these and other issues as part of broader legislation on cemetery reform taking shape in both houses of the New York legislature.

As usual, the hearing placed on public view a distorted image for funeral service. The recent expansion of The Loewen Group and SCI into the New York cemetery market is the underlying factor which has brought the issue to a head. It is no secret that both companies have bought many funeral homes in the region in recent years—and they are increasingly buying cemeteries as well.

The New York State Funeral Directors Association, for one, has mixed feelings about this development. Wayne Baxter testified that his membership is concerned that joint ownership might expose the public to excesses by unscrupulous funeral directors. He said regulations may be needed to ensure that money from the nonprofit cemeteries is not funneled into the profit-making funeral homes—a scenario that is more conceivable with joint ownership. The National Catholic Cemetery Conference, through spokeswoman Ellen Woodbury, also charges “conglomerate ownership” with an “outrageous litany of untruths and misinformation” designed to steer mourners away from religious cemeteries. “We have a 2,000 year old tradition of caring for the dead as a matter of faith, not as a matter of profit,” she said. Finally, Rabbi Elchonon Zohn, speaking for the Jewish Community Relations Council, also considered joint ownership problematic, maintaining that there is an incentive to adopt marketing practices that could generate immediate profits (such as selling two-for-one grave sites), but weaken a cemetery’s ability to maintain care when its space is sold out.

Whether true or not, recent alleged selling tactics by a Loewen Group sales person have provided ammunition for the reform camp—and made no friends in the major Roman Catholic diocese on Long Island. A Loewen representative, offering a “free crypt” at a nearby Loewen-owned cemetery, made the mistake of approaching Ellen Woodbury, director of cemeteries for the Rockville Centre Catholic Diocese and President of the National Catholic Cemetery Association. It was not a pretty picture—and Ms. Woodbury claims to have captured it all on tape.