Mr. Joshua Slocum
Page 5 of 5

that service should be part of the basic services fee. If using an automobile to obtain necessary
permits and death certificates is not common to virtually all forms of disposition or arrangements
offered by a provider, those charges cannot be included in the basic services fee.

We would note that, in addition to disclosing the existence of the basic services fee,
funeral providers are required to disclose the “principal basic services provided” in return for the
basic services fee. 16 CFR § 453.2(b)(4)Gii)(C)(1). This information about what services are
included in the basic services fee allows consumers to make informed decisions about whether
there are additional services they may want to purchase from the funeral provider or obtain from
other sources.

As you know, the views expressed in this letter are those of the FTC staff. They have not
been reviewed, approved, or adopted by the Commission, and they are not binding on the
Commission or any individual Commissioner. However, they do reflect the views of FTC staff
charged with enforcement of the Funeral Rule.

(ra \-ll>

Craig regillus
Funeral Rule Coordinator

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Mr. Joshua Slocum
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As a general rule, consumers have the right under the Funeral Rule to select and pay for
only those funeral goods and services they want. As explained in the Compliance Guide, there
are only three exceptions to this right: (1) The non-declinable basic services fee, 16 CFR
§ 453.2(b)(4)(iii)(C)(1); (2) Items required by law, 16 CFR § 453.2(b)(4)(iv), or by particular
cemeteries or crematories, 16 CFR § 453.3(d); and (3) Requests that are impossible, impractical
or excessively burdensome. 16 CFR § 453.4(b)(2)(B)(ii).*

Thus, where refrigeration is not part of the basic services fee, a provider can only assess a
non-declinable charge for refrigeration where refrigeration is required by law, by a particular
cemetery or a crematory, or where leaving a body unrefrigerated would be impossible,
impractical, or excessively burdensome under the circumstances.

We note that the Compliance Guide provides an instructive example of what would
constitute an “impossible, impractical or excessively burdensome request.” The Guide states that
a provider can refuse to provide arrangements without embalming when a family requests a delay
of five days for a funeral in July when the provider has no refrigeration facilities*> Although
refrigeration is addressed only indirectly in the example, it is staff’s view that the same analysis
should apply to refrigeration, and that under such circumstances, the Rule should also be
interpreted to allow a provider to refuse to provide arrangements, unless the family consents to
embalming or an immediate burial, or pays for refrigeration.

3. Charges for Use of a Vehicle To Obtain Death Certificates

Your request also argues that a separate itemized charge in a GPL for the use of a vehicle
to obtain required permits and death certificates constitutes a second, non-declinable fee in
violation of Section 453.2(b)(4)(iv) of the Rule. You note that, at least with respect to required
permits, Section 453.1(p) specifically cites “obtaining necessary permits” as an example of
“basic services . . . furnished by a funeral provider in arranging any funeral” that should be
included in the basic services fee. In your view, charges for the use of a vehicle to obtain death
certificates should be treated in the same way.

The services listed in Section 453.1(p) are meant to be illustrative, not exclusive nor
necessarily inclusive, of all services “common to virtually all forms of disposition or
arrangements” offered by a funeral provider, and therefore properly included in the basic services
fee. Thus, it is staff’s opinion that if using an automobile to obtain necessary permits and death
certificates is common to virtually all forms of disposition or arrangements, then the charge for

4 Compliance Guide at 24.

5 Id.


UNITED STATES OF AMERICA

FEDERAL TRADE COMMISSION
WASHINGTON, D.C. 20580

Division of Marketing Practices
Craig Tregillus Direct Dial: (202) 326-2970
ctregillus @ftc.gov Facsimile: (202) 326-3395

March 21, 2007

Mr. Joshua Slocum, Executive Director
Funeral Consumers Alliance, Inc.

33 Patchen Rd.

South Burlington, VT 05403

Dear Mr. Slocum:

You have requested a staff opinion on two questions relating to the basic services fee that
the FTC Funeral Rule (“Funeral Rule” or “Rule”) requires funeral providers to itemize separately
in their General Price List (“GPL”): (1) “Whether funeral providers may routinely charge a fee
for the refrigeration of bodies that is separate from the non-declinable basic services fee”; and
(2) “Whether funeral providers may charge a fee for the use of an automobile to procure
necessary permits, separate from the non-declinable basic services fee.” You contend that
charging separate fees for either of these services would amount to double-billing, because both
should be included, in your view, in the basic services fee.

1. The Basic Services Fee

Before addressing the questions raised by your inquiry, it is useful to review the role the
basic services fee plays within the framework of the Funeral Rule. Section 453.2(b)(4)(iii)(C) of
the Rule requires funeral providers to list the price of the “services of funeral director and staff”
in the GPL they must give to consumers. 16 C.F.R. § 453.2(b)(4)(iii)(C). Section 453.1(p)
defines “services of funeral director and staff’ as “the basic services, not to be included in prices
of other categories in § 453.2(b)(4),' that are furnished by a funeral provider in arranging any

, Section 453.2(b)(4)(ii) requires funeral providers to include in the GPL “in any

order, the retail prices (expressed either as the flat fee, or as the price per hour, mile or other unit
of computation) and the other information specified below for at least each of the following items
[identified in Section 453.2(b)(4)], if offered for sale.” 16 C.F.R. § 453.2(b)(4)Gi) (emphasis
added). This provision allows funeral providers to add charges to the GPL for funeral goods or
services they offer that are not identified in Section 453.2(b)(4), and that are not included in their
basic services fee.

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Mr. Joshua Slocum
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funeral, such as conducting the arrangements conference, planning the funeral, obtaining
necessary permits, and placing obituary notices.” 16 C.F.R. § 453.1(p).

In requiring disclosure of the “basic services fee” in the GPL, Section 453.2(b)(4)(iii)(C)
gives funeral providers the option of including the fee in their casket prices, and disclosing that
fact, 16 C.F.R. § 453.2(b)(4)(iii)(C)(2), or listing the fee separately from their casket prices, 16
CER. § 453.2(b)(4)(iii)(C)(D. In either case, the amount of the basic services fee must be
disclosed, together with a list of the “principal basic services provided” and included in the fee.

If the basic services fee is listed separately from the funeral provider’s casket prices, the
provider has the option of marking the basic services fee declinable or non-declinable by the
consumer. 16 C.F.R. § 453.2(b)(4)(iii)(C)(1)._ If the basic services fee is not declinable, it must
be included in the funeral provider’s charges for direct cremation, immediate burial, and
forwarding or receiving remains, and must include “all charges for the recovery of unallocated
funeral provider overhead.” 16 C.F.R. § 453.2(b)(4)(iii)(C)(1). Section 453.2(b)(4)(iv)
emphasizes that the basic services fee “is the only funeral provider fee for services, facilities or
unallocated overhead permitted by this part to be non-declinable, unless otherwise required by
law.”

Because the basic services fee may be (and often is) non-declinable, and thus must be
paid regardless of the funeral arrangements a consumer selects and receives, staff has interpreted
the provision with care to ensure that it includes only costs common to “any funeral.” 16 C.F.R.
§ 453.1(p) (emphasis added). Thus, the discussion of the basic services fee in the FTC’s
compliance guidelines for funeral providers, Complying with the Funeral Rule (“Compliance
Guide” or “Guide”), states:

This basic services fee should include services that are common to
virtually all forms of disposition or arrangements that you offer, such as
conducting the arrangements conference, securing the necessary permits,
preparing the notices, sheltering of remains, and coordinating the arrangements
with the cemetery, crematory, or other third parties.”

Our focus on whether particular services are “common to virtually all forms of
disposition or arrangements” offered by the funeral provider is evident in a note in the Guide that
discusses the sheltering of remains, which you cite in your request:

Note: You should include any charges for the ordinary sheltering of remains by
your funeral home in this basic services fee. However, you can list a separate

* Compliance Guide, p. 11.

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Mr. Joshua Slocum
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charge for sheltering of remains if: 1) a significant percentage of your customers
do not use the funeral home to hold the remains at any point, or 2) you receive a
request to hold the remains for an unusually long period of time.*

It is apparent from this discussion that charges for sheltering of remains are to be included in the
basic services fee when they are “common to virtually all forms of disposition or arrangements”
offered by a funeral home, and that sheltering of remains may be listed as a separate charge only
if this service is not “common.” It is this principle that continues to guide staff’s interpretation of
what should and should not be included in the basic services fee.

2. Refrigeration Charges

Your request argues, in effect, that refrigeration is a kind of “sheltering of remains,” and
that sheltering is a service “common” to all funeral arrangements, because no funeral provider
can arrange for the disposition of a body without taking custody of it and holding it somewhere.
You contend that placing the body in a refrigeration unit is simply an alternative to holding the
body elsewhere in the funeral home, and thus the cost of refrigeration should be included in the
basic services fee.

However, funeral homes may refrigerate some bodies and not others. For example, some
funeral homes may not make it a practice to refrigerate bodies that will be embalmed, buried or
cremated shortly after death. Consequently, including a charge for refrigeration in the non-
declinable basic services fee could force consumers who choose embalming, immediate burial or
cremation to pay for a service they do not use.

For these reasons, it is staff's opinion that if refrigeration of remains for some period of
time is “common to virtually all forms of disposition or arrangements” offered by a funeral
provider, refrigeration charges for that period of time should be included in the basic services fee.
However, if a funeral provider refrigerates remains in fewer than virtually all dispositions or
arrangements, refrigeration charges should not be included in the basic services fee, but should
be listed on the GPL as a separate service for which the provider may assess a separate charge.

In your letter you assert that some funeral homes are assessing a separate, non-declinable
charge for refrigeration. For funeral providers that offer refrigeration as a separate service
because refrigeration is not “common to virtually all” their dispositions or arrangements, the
question then becomes under what circumstances such a charge can be non-declinable.