Wisconsin Funeral Trade Groups Back Bill to Restrict Low-cost Competition
UPDATE 10/18/05 — Rep. Phil Montgomery's office announced last week that AB 485 was "dead," but Rep. Karl Van Roy, a co-sponsor and the chairman of the small business committee, brought the bill to a vote in amended form on October 17, 2005. The amended bill took out two of the most objectionable provisions — the ban on "strip-mall" funeral homes and the requirement to provide seating for 50 at all funeral homes — but still prohibits medical institutions, churches, synagogues, or "creed"- based groups from operating a funeral home. It will be interesting to see if this stands constitutional muster.
- protection - n. supervision or support of one that is smaller or weaker
- protectionism - n. . . . government economic protection for domestic producers through restrictions on foreign competitors
Sept. 28, 2005 — Funeral industry trade groups in Wisconsin are pushing a bill that would limit consumer choice and keep prices artificially high. And with the Orwellian style in such favor with business and government, they're calling it "consumer protection."
Assembly Bill 485 is pure economic protectionism, only the aliens in the midst of funeral service aren't foreign corporations. They're local entrepeneurs trying to offer lower-cost funerals. AB 485, introduced by state Representative Phil Montgomery, beefs up the requirements to open a funeral establishment in Wisconsin. Not in any way that would protect families from fraud, mind you. The bill just makes it illegal to open a funeral establishment unless it meets a laundry list of "facilities" requirements (or it's owned by a full-service, high-overhead funeral home that does) and unless it has on-site seating for at least 50. Oh, and it can't be housed in a building with more than one other business unrelated to funerals.
The bill is set to come to the Assembly floor for a vote in October, 2005. Sponsor Montgomery, and Mark Paget, Executive Director of the Wisconsin Funeral Directors' Assocation, have been quoted in the media claiming the bill is out to "protect consumers" from "fly-by-night" funeral homes.
"Actually, that was done to come after me," said a Wisconsin funeral director who asked not to be named. He operates a full-service funeral home, but he also runs a storefront operation that offers lower-cost funerals. "I can't see how this is protection for the consumer."
Neither can we. What is obvious is that the bill raises a high barrier to entry in the market, which shields an already insulated trade from competition. By forcing funeral establishments to be tied to a full-service facility with an embalming room, and by making it illegal to rent space from, say, a large shopping center building, the bill virtually guarantees that only those with a lot of capital can enter the business. And that means higher prices for consumers.
But according to the assistant executive director of the Wisconsin Funeral Service Alliance, an undertakers' trade group, AB 485 is a blessing. Erin Longmire breathlessly described it as "a fantastically wonderful consumer protection."
We had a hard time following this reasoning, but Longmire claimed the new bill would protect the public because it would allow the state to regulate "memorial centers," which she says aren't subject to oversight. She said the bill also nixes a current state law that requires every branch of a funeral home to have an on-site embalming room and a dedicated, licensed funeral director. So far, so good. But "in exchange" for this, she said, her group had to find "something else" for state inspectors to use as a criterion for issuing a permit for a funeral establishment.
"If you do not have a preparation room at that building, what else can we require [as a condition for] a license?" Longmire said. "We are then substituting the new requirements."
So, the purpose of the new requirements is to give the licensing board a justification for its bureaucratic act of issuing a permit? Isn't the purpose of licensing boards to check for things that affect the public welfare? Longmire said that was precisely the purpose of the bill - to allow the licensing board to license "memorial centers," low-cost outfits that are apparently running amok.
Why couldn't the state create a separate regulatory category - states like Florida already do - to regulate simple, no-frills funeral providers so the market could decide which businesses to support? Longmire's circular logic said that since the state "couldn't" license "memorial centers" under the new law unless the law redefined the licensing requirements, they had to redefine the licensing requirements.
When we asked what consumer protection purpose would be served by the 50-seat minimum and the no-funeral-homes-at-shopping-centers rule, the truth came out.
"The purpose of this bill is to eliminate any possibility of opening up what are called 'strip-mall funeral homes'," Longmire said.
Strip-mall funeral homes? Doubleplusungood.
"We have no interest in having those here," Longmire said. "There's no licensing . . .we don't want them here. It is a horrible precedent to set for how we value funeral service for the consumer in Wisconsin. We as an industry here in the state of Wisconsin have a very high bar that has been set in funeral service."
And ambitions to set it even higher - economic protectionism doesn't get anymore blatant than this. The public should find it offensive that a trade group has appointed itself arbiter of what kind of funeral home is right and proper. Offense should turn to outrage when undertakers try to use state law to pad their pockets at the expense of consumer choice. The buyer, not the seller, gets to decide just how much he values funeral service. If consumer spending doesn't jibe with undertaker expectations, c'est la mort.
Such protectionist bills enjoy the support of "traditionalists" who preach the value of elaborate funerals as they sweat the mortgages on their Palaces of Posthumous Repose. Meanwhile, public interest declines. 28 percent of Americans are choosing cremation over burial nationally. The industry trade magazines recognize this, exhorting their readers to adapt or die. Industry-commissioned surveys show fewer and fewer families plan on a "traditional" funeral with viewing and visitation at the funeral home. Yet Wisconsin, like most states, clings to outmoded requirements for embalming rooms (whose use is the profit center of the American funeral), but wouldn't dream of requiring refrigeration units.
Let's hope Wisconsin citizens demand their say in shaping laws that affect their choices for one of the most emotionally and financially costly decisions they'll ever make.
|Do you care about this issue? Are you a Wisconsin citizen who wants to be able to make your own decisions about how much you spend on funerals and where you spend it? Raise your voice! You don't have to passively accept the laws industry writes to line its pockets. Call or write your local legislators and tell them how you feel --- they work for you. Here's a link to the Wisconisn Legislature's Web site. If you write your legislator, we'd be grateful if you'd email us a copy.|