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91_HB2081sam001
LRB9103838DJcdam03
1 AMENDMENT TO HOUSE BILL 2081
2 AMENDMENT NO. . Amend House Bill 2081 by replacing
3 the title with the following:
4 "AN ACT concerning funeral and cemetery services,
5 amending named Acts."; and
6 on page 1, after line 4, by inserting the following:
7 "Section 2. The Illinois Funeral or Burial Funds Act is
8 amended by changing Section 1 as follows:
9 (225 ILCS 45/1) (from Ch. 111 1/2, par. 73.101)
10 Sec. 1. Payment under pre-need contract. Except as
11 otherwise provided in this Section, all sales proceeds paid
12 to any person, partnership, association or corporation with
13 respect to merchandise or services covered by this Act, upon
14 any agreement or contract, or any series or combination of
15 agreements or contracts, which has for a purpose the
16 furnishing or performance of funeral services, or the
17 furnishing or delivery of any personal property, merchandise,
18 or services of any nature in connection with the final
19 disposition of a dead human body, including, but not limited
20 to, outer burial containers, urns, combination casket-vault
21 units, caskets and clothing, for future use at a time
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1 determinable by the death of the person or persons whose body
2 or bodies are to be so disposed of, shall be held to be trust
3 funds, and shall be placed in trust in accordance with
4 Sections 1b and 2, or shall be used to purchase life
5 insurance or annuities in accordance with Section 2a. The
6 person, partnership, association or corporation receiving
7 said payments under a pre-need contract is hereby declared to
8 be a trustee thereof until deposits of funds are made in
9 accordance with Section 1b or 2a of this Act. Persons
10 holding less than $500,000 in trust funds may continue to act
11 as the trustee after the funds are deposited in accordance
12 with subsection (d) of Section 1b.
13 Nothing in this Act shall be construed to prohibit the
14 inclusion of outer burial containers in sales contracts under
15 the Illinois Pre-Need Cemetery Sales Act.
16 (Source: P.A. 88-477.)"; and
17 by replacing lines 27 and 28 with the following:
18 "Section 10. The Illinois Pre-Need Cemetery Sales Act is
19 amended by changing Sections 4, 14, 15, and 20 as follows:
20 (815 ILCS 390/4) (from Ch. 21, par. 204)
21 Sec. 4. Definitions. As used in this Act, the following
22 terms shall have the meaning specified:
23 (a) "Pre-need sales contract" or "Pre-need sales" means
24 any agreement or contract or series or combination of
25 agreements or contracts which have for a purpose the sale of
26 cemetery merchandise, cemetery services or undeveloped
27 interment, entombment or inurnment spaces where the terms of
28 such sale require payment or payments to be made at a
29 currently determinable time and where the merchandise,
30 services or completed spaces are to be provided more than 120
31 days following the initial payment on the account.
32 (b) "Delivery" occurs when:
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1 (1) physical possession of the merchandise is
2 transferred or the easement for burial rights in a
3 completed space is executed, delivered and transferred to
4 the buyer; or
5 (2) title to the merchandise has been transferred
6 to the buyer and the merchandise has been paid for and is
7 in the possession of the seller who has placed it, until
8 needed, at the site of its ultimate use; or
9 (3) (A) A. the merchandise has been permanently
10 identified with the name of the buyer or the beneficiary
11 and delivered to a licensed and bonded warehouse and both
12 title to the merchandise and a warehouse receipt have
13 been delivered to the purchaser or beneficiary; except
14 that in the case of outer burial containers, the use of a
15 licensed and bonded warehouse as set forth in this
16 paragraph shall not constitute delivery for purposes of
17 this Act. Nothing herein shall prevent a seller from
18 perfecting a security interest in accordance with the
19 Uniform Commercial Code on any merchandise covered under
20 this Act.
21 (B) B. All warehouse facilities to which sellers
22 deliver merchandise pursuant to this Act shall:
23 (i) be either located in the State of Illinois
24 or qualify as a foreign warehouse facility as
25 defined herein;
26 (ii) submit to the Comptroller not less than
27 annually, by March 1 of each year, a report of all
28 cemetery merchandise stored by each licensee under
29 this Act which is in storage on the date of the
30 report;
31 (iii) permit the Comptroller or his designee
32 at any time to examine stored merchandise and to
33 examine any documents pertaining thereto;
34 (iv) submit evidence satisfactory to the
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1 Comptroller that all merchandise stored by said
2 warehouse for licensees under this Act is insured
3 for casualty or other loss normally assumed by a
4 bailee for hire;
5 (v) demonstrate to the Comptroller that the
6 warehouse has procured and is maintaining a
7 performance bond in the form, content and amount
8 sufficient to unconditionally guarantee to the
9 purchaser or beneficiary the prompt shipment of the
10 cemetery merchandise.
11 (C) C. "Cemetery merchandise" means items of
12 personal property normally sold by a cemetery authority
13 not covered under the Illinois Funeral or Burial Funds
14 Act "An Act concerning agreements for furnishing or
15 delivery of personal property, merchandise or services in
16 connection with the final disposition of dead human
17 bodies and regulating use or disposition of funds paid on
18 said agreements and providing penalties for violation
19 thereof", approved July 14, 1955, as amended, including
20 but not limited to:
21 (1) memorials,
22 (2) markers,
23 (3) monuments, and
24 (4) foundations, and.
25 (5) outer burial containers.
26 (D) D. "Undeveloped interment, entombment or
27 inurnment interment spaces" or "undeveloped spaces" means
28 any space to be used for the reception of human remains
29 that is not completely and totally constructed at the
30 time of initial payment therefor therefore in a:
31 (1) lawn crypt,
32 (2) mausoleum,
33 (3) garden crypt,
34 (4) columbarium, or
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1 (5) cemetery section.
2 (E) E. "Cemetery services" means those services
3 customarily performed by a cemetery or crematory
4 personnel in connection with the interment, entombment,
5 inurnment or cremation of a dead human body.
6 (F) F. "Cemetery section" means a grouping of
7 spaces intended to be developed simultaneously for the
8 purpose of interring human remains.
9 (G) G. "Columbarium" means an arrangement of niches
10 that may be an entire building, a complete room, a series
11 of special indoor alcoves, a bank along a corridor or
12 part of an outdoor garden setting that is constructed of
13 permanent material such as bronze, marble, brick, stone
14 or concrete for the inurnment of human remains.
15 (H) H. "Lawn crypt" means a permanent underground
16 crypt usually constructed of reinforced concrete or
17 similar material installed in multiple units for the
18 interment of human remains.
19 (I) I. "Mausoleum" or "garden crypt" means a
20 grouping of spaces constructed of reinforced concrete or
21 similar material constructed or assembled above the
22 ground for entombing human remains.
23 (J) J. "Memorials, markers and monuments" means the
24 object usually comprised of a permanent material such as
25 granite or bronze used to identify and memorialize the
26 deceased.
27 (K) K. "Foundations" means those items used to
28 affix or support a memorial or monument to the ground in
29 connection with the installation of a memorial, marker or
30 monument.
31 (L) L. "Person" means an individual, corporation,
32 partnership, joint venture, business trust, voluntary
33 organization or any other form of entity.
34 (M) M. "Seller" means any person selling or
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1 offering for sale cemetery merchandise, cemetery services
2 or undeveloped spaces on a pre-need basis.
3 (N) N. "Religious cemetery" means mean a cemetery
4 owned, operated, controlled or managed by any recognized
5 church, religious society, association or denomination or
6 by any cemetery authority or any corporation
7 administering, or through which is administered, the
8 temporalities of any recognized church, religious
9 society, association or denomination.
10 (O) O. "Municipal cemetery" means a cemetery owned,
11 operated, controlled or managed by any city, village,
12 incorporated town, township, county or other municipal
13 corporation, political subdivision, or instrumentality
14 thereof authorized by law to own, operate or manage a
15 cemetery.
16 (O-1) "Outer burial container" means a container
17 made of concrete, steel, wood, fiberglass, or similar
18 material, used solely at the interment site, and designed
19 and used exclusively to surround or enclose a separate
20 casket and to support the earth above such casket,
21 commonly known as a burial vault, grave box, or grave
22 liner, but not including a lawn crypt.
23 (P) P. "Sales price" means the gross amount paid by
24 a purchaser on a pre-need sales contract for cemetery
25 merchandise, cemetery services or undeveloped interment,
26 entombment or inurnment spaces, excluding sales taxes,
27 credit life insurance premiums, finance charges and
28 "Cemetery Care Act" contributions.
29 (Q) Q. "Foreign warehouse facility" means a
30 warehouse facility now or hereafter located in any state
31 or territory of the United States, including the District
32 of Columbia, other than the State of Illinois.
33 A foreign warehouse facility shall be deemed to have
34 appointed the Comptroller to be its true and lawful
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1 attorney upon whom may be served all legal process in any
2 action or proceeding against it relating to or growing
3 out of this Act, and the acceptance of the delivery of
4 stored merchandise under this Act shall be signification
5 of its agreement that any such process against it which
6 is so served, shall be of the same legal force and
7 validity as though served upon it personally.
8 Service of such process shall be made by delivering
9 to and leaving with the Comptroller, or any agent having
10 charge of the Comptroller's Department of Cemetery and
11 Burial Trusts, a copy of such process and such service
12 shall be sufficient service upon such foreign warehouse
13 facility if notice of such service and a copy of the
14 process are, within 10 days thereafter, sent by
15 registered mail by the plaintiff to the foreign warehouse
16 facility at its principal office and the plaintiff's
17 affidavit of compliance herewith is appended to the
18 summons. The Comptroller shall keep a record of all
19 process served upon him under this Section and shall
20 record therein the time of such service.
21 (Source: P.A. 85-1209; revised 10-31-98.)
22 (815 ILCS 390/14) (from Ch. 21, par. 214)
23 Sec. 14. A written sales contract shall be executed in
24 duplicate for each pre-need sale made by a licensee, and a
25 signed copy given to the purchaser. Each completed contract
26 shall be numbered and shall contain the name of the purchaser
27 and the seller, the name of the person, if known, who is to
28 receive the cemetery merchandise, cemetery services or the
29 completed interment, entombment or inurnment spaces under the
30 contract and specifically identify such merchandise, services
31 or spaces. In addition, such contracts must contain a
32 provision in distinguishing typeface substantially as follow:
33 "Notwithstanding anything in this contract to the
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1 contrary, you are afforded certain specific rights of
2 cancellation and refund under Sections 18 and 19 of the
3 Illinois Pre-Need Cemetery Sales Act, enacted by the 84th
4 General Assembly of the State of Illinois".
5 All pre-need sales contracts shall be sold on a
6 guaranteed price basis. At the time of performance of the
7 service or delivery of the merchandise, the seller shall be
8 prohibited from assessing the purchaser or his heirs or
9 assigns or duly authorized representative any additional
10 charges for the specific merchandise and services listed on
11 the pre-need sales contract.
12 All pre-need sales contracts must be in writing and no
13 pre-need contract form shall be used without prior filing
14 with the Comptroller. The Comptroller shall review all
15 pre-need sales contract forms and shall prohibit the use of
16 contract forms that do not meet the requirements of this Act
17 upon written notification to the seller. Any use or
18 attempted use of any oral pre-need sales contract or any
19 written pre-need sales contract in a form not filed with the
20 Comptroller or in a form that does not meet the requirements
21 of this Act shall be deemed a violation of this Act.
22 (Source: P.A. 85-805.)
23 (815 ILCS 390/15) (from Ch. 21, par. 215)
24 Sec. 15. (a) Whenever a seller receives anything of
25 value under a pre-need sales contract, the person receiving
26 such value shall deposit 50% of all proceeds received into
27 one or more trust funds maintained pursuant to this Section,
28 except that, in the case of proceeds received for the
29 purchase of outer burial containers, 85% of the proceeds
30 shall be deposited into one or more trust funds. Such
31 deposits shall be made until the amount deposited in trust
32 equals 50% of the sales price of the cemetery merchandise,
33 cemetery services and undeveloped spaces included in such
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1 contract, except that, in the case of deposits for outer
2 burial containers, deposits shall be made until the amount
3 deposited in trust equals 85% of the sales price. In the
4 event an installment contract is factored, discounted or sold
5 to a third party, the seller shall deposit an amount equal to
6 50% of the sales price of the installment contract, except
7 that, for the portion of the contract attributable to the
8 sale of outer burial containers, the seller shall deposit an
9 amount equal to 85% of the sales price. Proceeds required to
10 be deposited in trust which are attributable to cemetery
11 merchandise and cemetery services shall be held in a
12 "Cemetery Merchandise Trust Fund". Proceeds required to be
13 deposited in trust which are attributable to the sale of
14 undeveloped interment, entombment or inurnment spaces shall
15 be held in a "Pre-construction Trust Fund". If merchandise is
16 delivered for storage in a bonded warehouse, as authorized
17 herein, and payment of transportation or other charges
18 totaling more than $20 will be required in order to secure
19 delivery to the site of ultimate use, upon such delivery to
20 the warehouse the seller shall deposit to the trust fund the
21 full amount of the actual or estimated transportation charge.
22 Transportation charges which have been prepaid by the seller
23 shall not be deposited to trust funds maintained pursuant to
24 this Section. As used in this Section, "all proceeds" means
25 the entire amount paid by a purchaser in connection with a
26 pre-need sales contract, including finance charges and
27 Cemetery Care Act contributions, but excluding sales taxes
28 and credit life insurance premiums.
29 (b) All trust deposits required by this Act shall be
30 made within 30 days following the end of the month of
31 receipt.
32 (c) A trust established under this Act must be
33 maintained:
34 (1) in a trust account established in a bank, savings
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1 and loan association or credit union authorized to do
2 business in Illinois where such accounts are insured by an
3 agency of the federal government;
4 (2) in a trust company authorized to do business in
5 Illinois; or
6 (3) in an investment company authorized to do business
7 in Illinois insured by the Securities Brokers Insurance
8 Corporation.
9 (d) Funds deposited in the trust account shall be
10 identified in the records of the seller by the name of the
11 purchaser. Nothing shall prevent the trustee from commingling
12 the deposits in any such trust fund for purposes of the
13 management thereof and the investment of funds therein as
14 provided in the "Common Trust Fund Act", approved June 24,
15 1949, as amended. In addition, multiple trust funds
16 maintained pursuant to this Act may be commingled or
17 commingled with other funeral or burial related trust funds,
18 provided that all record keeping requirements imposed by or
19 pursuant to law are met.
20 (e) In lieu of a pre-construction trust fund, a seller
21 of undeveloped interment, entombment or inurnment spaces may
22 obtain and file with the Comptroller a performance bond in an
23 amount at least equal to 50% of the sales price of the
24 undeveloped spaces or the estimated cost of completing
25 construction, whichever is greater. The bond shall be
26 conditioned on the satisfactory construction and completion
27 of the undeveloped spaces as required in Section 19 of this
28 Act.
29 Each bond obtained under this Section shall have as
30 surety thereon a corporate surety company incorporated under
31 the laws of the United States, or a State, the District of
32 Columbia or a territory or possession of the United States.
33 Each such corporate surety company must be authorized to
34 provide performance bonds as required by this Section, have
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1 paid-up capital of at least $250,000 in cash or its
2 equivalent and be able to carry out its contracts. Each
3 pre-need seller must provide to the Comptroller, for each
4 corporate surety company such seller utilizes, a statement of
5 assets and liabilities of the corporate surety company sworn
6 to by the president and secretary of the corporation by
7 January 1 of each year.
8 The Comptroller shall prohibit pre-need sellers from
9 doing new business with a corporate surety company if the
10 company is insolvent or is in violation of this Section. In
11 addition the Comptroller may direct a pre-need seller to
12 reinstate a pre-construction trust fund upon the
13 Comptroller's determination that the corporate surety company
14 no longer is sufficient security.
15 All performance bonds issued pursuant to this Section
16 must be irrevocable during the statutory term for completing
17 construction specified in Section 19 of this Act, unless
18 terminated sooner by the completion of construction.
19 (f) Whenever any pre-need contract shall be entered into
20 and include 1) items of cemetery merchandise and cemetery
21 services, and 2) rights to interment, inurnment or entombment
22 in completed spaces without allocation of the gross sale
23 price among the items sold, the application of payments
24 received under the contract shall be allocated, first to the
25 right to interment, inurnment or entombment, second to items
26 of cemetery merchandise and cemetery services, unless some
27 other allocation is clearly provided in the contract.
28 (g) Any person engaging in pre-need sales who enters
29 into a combination sale which involves the sale of items
30 covered by a trust or performance bond requirement and any
31 item not covered by any entrustment or bond requirement,
32 shall be prohibited from increasing the gross sales price of
33 those items not requiring entrustment with the purpose of
34 allocating a lesser gross sales price to items which require
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1 a trust deposit or a performance bond.
2 (Source: P.A. 85-1209.)
3 (815 ILCS 390/20) (from Ch. 21, par. 220)
4 Sec. 20. (a) Each licensee must keep accurate accounts,
5 books and records in this State of all transactions, copies
6 of agreements, dates and amounts of payments made or
7 received, the names and addresses of the contracting parties,
8 the names and addresses of persons for whose benefit funds
9 are received, if known, and the names of the trust
10 depositories.
11 (b) Each licensee must maintain such records for a
12 period of 3 years after the licensee shall have fulfilled his
13 obligation under the pre-need contract or 3 years after any
14 stored merchandise shall have been provided to the purchaser
15 or beneficiary, whichever is later.
16 (c) Each licensee shall submit reports to the
17 Comptroller annually, under oath, on forms furnished by the
18 Comptroller. The annual report shall contain, but shall not
19 be limited to, the following:
20 (1) An accounting of the principal deposit and
21 additions of principal during the fiscal year.
22 (2) An accounting of any withdrawal of principal or
23 earnings.
24 (3) An accounting at the end of each fiscal year,
25 of the total amount of principal and earnings held.
26 (d) The annual report shall be filed by the licensee
27 with the Comptroller within 75 days after the end of the
28 licensee's fiscal year. An extension of up to 60 days may be
29 granted by the Comptroller, upon a showing of need by the
30 licensee. Any other reports shall be in the form furnished
31 or specified by the Comptroller. If a licensee fails to
32 submit an annual report to the Comptroller within the time
33 specified in this Section, the Comptroller shall impose upon
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1 the licensee a penalty of $5 for each and every day the
2 licensee remains delinquent in submitting the annual report.
3 Each report shall be accompanied by a check or money order in
4 the amount of $10 payable to: Comptroller, State of
5 Illinois.
6 (e) On and after the effective date of this amendatory
7 Act, a licensee may report all required information
8 concerning the sale of outer burial containers on the
9 licensee's annual report required to be filed under this Act
10 and shall not be required to report that information under
11 the Illinois Funeral or Burial Funds Act.
12 (Source: P.A. 88-477.)
13 Section 99. Effective date. This Act takes effect upon
14 becoming law, except that the changes to the Illinois Funeral
15 or Burial Funds Act and the Illinois Pre-Need Cemetery Sales
16 Act take effect on January 1, 2000.".