2023 New York Laws › NPC - Not-For-Profit Corporation › Article 15 - Public Cemetery Corporations › 1507 - Trust Funds.

§ 1507. Trust funds.
(a)  Maintenance and preservation; permanent maintenance fund; current
maintenance fund. Subject to  rules  and  regulations  of  the  cemetery
board:  (1)  Every  cemetery corporation shall maintain and preserve the
cemetery, including all lots, plots and  parts  thereof.  For  the  sole
purpose of such maintenance and preservation, every cemetery corporation
shall establish and maintain (A) a permanent maintenance fund, and (B) a
current  maintenance fund. At the time of making the sale of a lot, plot
or part thereof, the cemetery corporation shall deposit  not  less  than
ten  per  centum  of  the  gross proceeds of the sale into the permanent
maintenance fund. An additional fifteen per centum of the gross proceeds
of the sale shall be deposited  in  the  current  maintenance  fund.  In
addition to the foregoing, at the time the cemetery corporation receives
payment  for  the performance of an interment or inurnment, the cemetery
corporation shall collect and deposit  into  the  permanent  maintenance
fund the sum of thirty-five dollars.  (2) The permanent maintenance fund
is hereby declared to be and shall be held by the corporation as a trust
fund,  for  the  purpose  of  maintaining  and  preserving the cemetery,
including all lots,  crypts,  niches,  plots,  and  parts  thereof.  The
principal  of  such  fund  shall  be  invested in such securities as are
permitted for the investment of trust funds by  section  11-2.3  of  the
estates,  powers  and trusts law. The income in the form of interest and
ordinary dividends therefrom shall be used solely  for  the  maintenance
and  preservation  of  the  cemetery grounds. In addition, the governing
board of the corporation may appropriate for expenditure solely for  the
maintenance  and  preservation  of the cemetery grounds a portion of the
net appreciation, in the fair market  value  of  the  principal  of  the
trust, as is prudent under the standard established by article five-A of
this  chapter, the prudent management of institutional funds act. In the
event that a cemetery corporation seeks to appropriate any percentage of
its net appreciation in its permanent  maintenance  fund  in  accordance
with this subparagraph, the cemetery corporation shall provide notice of
such  proposed appropriation by certified mail to the cemetery board not
less than sixty days in advance of such proposed appropriation and shall
disclose such appropriation as part of and in addition to  their  annual
reporting  requirements  as  defined in section fifteen hundred eight of
this article, setting forth the amount of funds to be  appropriated  for
such  expenditure and its effect on the permanent maintenance fund. Such
proposed appropriation shall become effective sixty days  after  receipt
of  such  notice, unless the cemetery board within such sixty-day period
notifies the cemetery corporation that the board objects to the proposed
appropriation.  Notwithstanding  the  foregoing   provisions   of   this
subparagraph,  all  principal  of  the  permanent maintenance fund shall
remain inviolate, except that, upon application to the supreme court  in
a district where a portion of the cemetery grounds is located, the court
may  make an order permitting the principal or a part thereof to be used
for the purpose of current maintenance and preservation of the  cemetery
or  otherwise.  Such  application  may  be made by the cemetery board on
notice to the corporation  or  by  the  corporation  on  notice  to  the
cemetery  board.    Unless  the cemetery can clearly demonstrate that it
lacks sufficient future revenue to make repayment,  any  such  allowance
from  the permanent maintenance fund shall be in the form of a loan, and
the court shall determine the method for repayment of such a loan by the
cemetery to the fund. If the  cemetery  clearly  demonstrates  it  lacks
sufficient  future  revenue  to  make  repayment such allowance from the
permanent maintenance fund shall be in the form  of  a  grant  that  the
cemetery is not required to repay into its permanent maintenance fund. A
cemetery,   including   a  surviving  cemetery  following  a  merger  or

consolidated cemetery following a consolidation, may seek a modification
of the method of repayment, or conversion of a loan to a grant,  if  the
cemetery   can   clearly   demonstrate   that  the  cemetery  merged  or
consolidated  into  the  surviving  cemetery will not produce sufficient
future revenue to make repayment under  the  existing  loan.
(3)  The
current  maintenance fund shall be used and applied for the sole purpose
of ordinary and necessary expenses of the care and  maintenance  of  the
cemetery. When all burial rights in the cemetery have been conveyed, the
fund  remaining  on  deposit or to the credit of the current maintenance
fund shall be transferred into the permanent maintenance fund.  (4)  The
percentage  of  the  proceeds  of  sales required to be deposited in the
permanent maintenance fund or current maintenance fund by  a  particular
cemetery  corporation  may  be  increased  or diminished by order of the
supreme court in a  district  where  any  portion  of  the  cemetery  is
located. Such application may be made by the cemetery board on notice to
the corporation or by the corporation on notice to the cemetery board.
(b)  Perpetual care of lots. (1) Upon the application of a prospective
purchaser of any lot, plot or part  thereof  and  upon  payment  of  the
purchase  price  and  the  amount  fixed  as a reasonable charge for the
perpetual care  of  any  lot,  plot  or  part  thereof,  every  cemetery
corporation  shall  include  with  the  deed  of conveyance an agreement
perpetually to care for such lot, plot, or part thereof, to  the  extent
that the income derived by the corporation from such amount will permit.
(2)  Such  corporation  also, upon the application of an owner or of the
executor or administrator of a deceased owner of any lot  and  upon  the
payment  of  the  amount  fixed as a reasonable charge for the perpetual
care of such lot, shall, and upon the application of  any  other  person
and  the  payment  of  such amount, may enter into a like agreement with
him. Such agreement shall be executed and may be recorded  in  the  same
manner  as a deed. (3) Any corporation organized under or subject to the
provisions of this section may enter into an agreement in  writing  with
any  executor  or  executors, trustee or trustees, under a last will and
testament to whom there  has  heretofore  been,  or  may  hereafter  be,
bequeathed a sum for the perpetual care of any lot, plot or part thereof
in  any  such  cemetery or with any administrator or administrators with
the will annexed under any such will perpetually to care for  such  lot,
plot or part thereof under the provisions of the terms of such last will
and  testament,  and  subject  in  all  cases  to  the  approval  of the
surrogate's court having  jurisdiction  over  such  trust  estate.  Such
approval may be evidenced by the written endorsement of the surrogate on
a  duplicate  original of such agreement filed in the surrogate's court.
In case the surrogate shall approve such agreement  any  such  executor,
trustee  or administrator with the will annexed thereupon shall pay over
to  the  treasurer  of  such  perpetual  care  fund  of  such   cemetery
corporation any moneys remaining or being in his hands belonging to such
trust,  and  upon  making  such  payment and accounting therefore to the
surrogate's court may be discharged from said trust  as  such  executor,
trustee or administrator with the will annexed.
(c)  Perpetual  care  fund.  (1)  Every cemetery corporation and every
religious corporation having charge and  control  of  a  cemetery  which
heretofore  has  been  or which hereafter may be used for burials, shall
keep separate and apart from its other funds, all  moneys  and  property
received  by  it,  whether  by  contract, in trust or otherwise, for the
perpetual care and maintenance of any lot, plot or part thereof  in  its
cemetery,  and  all  such  moneys  or  property  so received by any such
corporation are hereby  declared  to  be,  and  shall  be  held  by  the
corporation  as trust funds. Any moneys and property so received, unless
otherwise provided in the instrument under which such moneys or property

were received, shall be kept in a separate  fund  to  be  known  as  the
perpetual  care  fund.  (2) The principal of such funds, whether kept in
the perpetual care fund or otherwise, and  unless  already  so  invested
when  received, shall be invested within a reasonable time after receipt
thereof, and kept invested, in such securities as are permitted for  the
investment  of trust funds by sections 11-2.2 and 11-2.3 of the estates,
powers and trusts law. The income arising therefrom shall be used solely
for the perpetual care and maintenance of the  lot  or  plots  or  parts
thereof  for  which  such  income  has  been  provided. In addition, the
governing board of  the  corporation  may  appropriate  for  expenditure
solely  for  the  perpetual  care and maintenance of the lot or plots or
parts thereof for which such income has been provided, a portion of  the
net  appreciation in the fair market value of the principal of the trust
as is prudent under the standard established by article five-A  of  this
chapter, the prudent management of institutional funds act. In the event
that  a  cemetery corporation seeks to appropriate any percentage of its
net appreciation in its perpetual care  fund  in  accordance  with  this
subparagraph,  the  cemetery  corporation  shall  provide notice of such
appropriation to the cemetery board not less than sixty days in  advance
of  such proposed appropriation and shall disclose such appropriation as
part of and in  addition  to  their  annual  reporting  requirements  as
defined  in  section fifteen hundred eight of this article setting forth
the amount of funds appropriated for such expenditure and its effect  on
the  perpetual  care  funds.  Such  proposed  appropriation shall become
effective sixty days after receipt of such notice, unless  the  cemetery
board  within  such  sixty  day period notifies the cemetery corporation
that  the  board  objects  to  the  proposed  appropriation.   (3)   The
corporation  may,  for  the  purpose  of  investing and reinvesting such
funds, add the same to any similar trust fund  or  funds  and  apportion
shares  or  interest to each trust fund, showing upon its records at all
times every share or interest. (4) The corporation may accept  in  trust
for  the  perpetual care of a lot, plot or part thereof in its cemetery,
property not made eligible for the investment of trust funds  under  the
foregoing provisions of this subdivision and may retain such property in
the  form  in which received, separate and apart from the perpetual care
fund, if directed so to do by the instrument under which  such  property
is  received,  so  long as such property remains in the form in which it
was received; but whenever such property is sold or  otherwise  disposed
of,  the proceeds of such sale or other disposition shall be invested in
the manner heretofore provided in this subdivision for the investment of
trust funds. The exchange of stock or evidences of  indebtedness  issued
by  a  corporation  for  stock  or evidences of indebtedness of the same
corporation, or for stock, evidences of indebtedness, warrants or script
received as a result of merger, consolidation or reorganization of  such
corporation,  or  the  receipt  of  additional  stock  or  evidences  of
indebtedness of such corporation, as a distribution by such corporation,
shall not be deemed to be  a  disposition  of  the  property  originally
received  in  trust,  and  such  exchanged or additional property may be
retained in place and stead of the  property  originally  received,  and
under  the same conditions. The corporation shall keep accurate accounts
of all funds for the perpetual care and maintenance  of  cemetery  lots,
plots  or parts thereof, separate and apart from its other funds. A copy
of the record pertaining to each such perpetual care fund  shall  be  at
all  times  available  at  the  office  of  the corporation during usual
business hours, for inspection and copy by any owner of an  endowed  lot
or his representative.
(d)  Perpetual  care  fund;  allocation of income and cost of care and
maintenance. On or before the fifteenth day of March  in  each  calendar

year  the officers of every cemetery corporation shall fix and determine
that portion of the income on the investment of  the  principal  of  the
perpetual  care  fund  during  the  calendar  or fiscal year immediately
preceding,  to  be  apportioned to each separate lot or part thereof for
which a perpetual care agreement has been made.  The  cost  during  such
previous calendar or fiscal year of the care of each lot or part thereof
shall  be allocated and charged against the income so apportioned to it.
Any excess of the income so apportioned over  and  above  the  allocated
cost  of  the  care and maintenance of such lot or part thereof shall be
credited to such lot or part thereof, to be used in any future years  to
make  up  the  deficiency  if the income apportioned to such lot or part
thereof should, in any year  since  September  first,  nineteen  hundred
forty-nine,  or in any future year, fall, or have fallen, below the cost
of care thereof.
(e) Designation of fiduciary corporation by directors or  trustees  of
cemetery  corporation to act as custodians of funds. Notwithstanding the
provisions of any other law,  the  directors  or  trustees  of  cemetery
corporations  are hereby authorized to designate a bank or trust company
to act as custodian and trustee of any or all of the respective funds of
such cemetery corporation received by it for the perpetual care of  lots
in  the cemetery thereof pursuant to paragraph (b), of this section, the
permanent maintenance of such cemetery pursuant to paragraph (a) of this
section, and for special purposes pursuant  to  paragraph  (f)  of  this
section. Such corporate trustee shall be designated by a resolution duly
adopted  by the board of directors or trustees and approved by a justice
of the supreme court of the judicial district in which the  cemetery  of
said  corporation is located or the cemetery board; and the directors or
trustees of such cemetery corporation may,  with  the  approval  of  the
justice  of  the  supreme court, revoke such trust, and either take over
such trust fund or name another trustee to handle the same, but  if  not
so  revoked,  such  trust  shall be perpetual. Any bank or trust company
accepting any such cemetery fund shall keep the same separate  from  all
other funds, except that it may, irrespective of any provision contained
in  this  article  invest  the  same  in a legal common trust fund or in
shares of a mutual trust investment company organized under the  banking
law,  and  shall pay over the net income to the directors or trustees of
the cemetery corporation by whom it shall be expended and applied to the
purpose for which such trust fund was paid to the cemetery  corporations
and accounted for in accordance with such paragraphs (a), (b) and (f) of
this section.
(e-1)  Monument  maintenance  fund.  (1)  A  cemetery corporation may,
subject to the approval of the cemetery board, establish and maintain  a
monument  maintenance  fund.  Such  a  fund is hereby declared to be and
shall be held by the cemetery corporation  as  a  trust  fund,  for  the
purpose  of providing notice if such monuments are damaged or defaced by
an act of vandalism and for the restoration of such  monuments.  Two  or
more  cemetery  corporations  may establish a joint monument maintenance
fund.
(2) The  principal  of  the  fund  shall  be  invested  in  securities
permitted  for  the  investment  of  trust  funds by sections 11-2.2 and
11-2.3 of the estates, powers and trusts law. The principal of such fund
shall remain inviolate, except that upon  application  to  the  cemetery
board,  which  may  make  an  order  permitting  the principal or a part
thereof to be used for the purpose of  restoring  monuments  damaged  or
defaced  by an act of vandalism. The income arising from such investment
shall be used solely for the costs and expenses resulting from an act of
vandalism against monuments in such cemetery.
(3) The fund shall be financed by a charge levied at the time of  each
interment  at  a rate established by each cemetery creating such a fund,
subject to cemetery board approval pursuant to section  fifteen  hundred
nine  of  this article. Such a charge shall be levied in addition to the
approved  rates for interment. The fund may also accept gifts, donations
and bequests.
(4) Each cemetery creating such a  fund  shall  promulgate  rules  and
regulations  to  administer the fund, subject to cemetery board approval
pursuant to section fifteen hundred nine of  this  article.  Such  rules
shall  include  the conditions under which the income from such fund may
be properly expended.
(5) The cemetery corporation  shall  keep  accurate  accounts  of  all
moneys for the fund, separate and apart from its other funds.
(f)  Acquisition  of property for special purposes and in trust. (1) A
cemetery corporation may acquire, otherwise than by  condemnation,  real
or   personal  property,  absolutely  or  in  trust,  in  perpetuity  or
otherwise, and shall use the same or the income therefrom  in  pursuance
of  the  terms  of  the  instrument  by  which  it was acquired, for the
following purposes only: (i) The improvement or embellishment,  but  not
the enlargement, of its cemetery; (ii) The construction, preservation or
replacement  of  any  building, structure, fence, wall, or walk therein;
(iii) The erection, renewal  or  preservation  of  any  tomb,  monument,
stone,  fence, wall, railing or other erection or structure on or around
its  cemetery  or  any  lot  or  plot  therein;  (iv)  The  planting  or
cultivation  of  trees, grass, shrubs, flowers or plants in or about its
cemetery or any lot or plot therein; (v)  The  construction,  operation,
maintenance,  repair  and  replacement  of a crematory or columbarium or
both in its cemetery; (vi) The care, keeping in order and  embellishment
of  any  lot,  plot  or  part  thereof or the structures thereon, in its
cemetery, as prescribed in the instrument transferring such property  to
the  cemetery corporation, or by the person or persons from time to time
having possession, care and control of such lot, plot or  part  thereof,
as  the  case may be. (2) All moneys and property received by a cemetery
corporation in trust under this subdivision, unless  otherwise  provided
in  the instrument under which such moneys or property were received and
unless already so invested when received, shall  be  invested  within  a
reasonable  time  after  the  receipt thereof, and kept invested in such
securities as are  permitted  for  the  investment  of  trust  funds  by
sections  11-2.2  and  11-2.3 of the estates, powers and trusts law. The
corporation may, for the  purpose  of  investing  and  reinvesting  such
funds,  add  the  same  to any similar trust fund or funds and apportion
shares or interests to each trust fund, showing upon its records at  all
times every share or interest. The cemetery corporation shall maintain a
record  for  each  such  trust  fund.  Such record shall be at all times
available at the office of the corporation during usual business  hours,
for  inspection  and  copy  by  any  owner  of  an  endowed  lot  or his
representative.
(g) Trust for the care  of  burial  ground.  A  cemetery  corporation,
incorporated  under or by a general or special law, may receive tangible
property, securities or funds in trust, and hold and invest the same and
apply the principal or income thereof, in accordance with the  terms  of
the  trust,  for  the  purpose  of  repairing, maintaining, improving or
embellishing a burial ground, not constituting a part of the cemetery of
such cemetery corporation, and located outside of a city  of  more  than
one  million  inhabitants  and  within  ten miles of the cemetery of the
corporation accepting such trust. The directors of such corporation,  or
a  majority  of them and the treasurer, shall annually within sixty days
after the close of each calendar or fiscal year, make,  sign  and  shall

file  at  the office of the corporation a detailed accounting and report
of such trust funds held under this subdivision and the use made of such
funds or of the income thereof for  the  preceding  calendar  or  fiscal
year,  which  shall  include  among other things, properly itemized, the
securities in which the same is then invested, and any purchases,  sales
or  other changes made therein during the period covered by such report.
Such accounting and report shall be at all times available at the office
of the corporation, during usual business hours, for inspection and copy
by any lot owner or any contributor to such trust fund.
(h) Vandalism, abandonment  and  monument  repair  or  removal.
(1)
Cemeteries  incorporated  under  this article shall contribute to a fund
created pursuant to section ninety-seven-r of the state finance law  for
the maintenance of abandoned cemeteries, for the restoration of property
damaged by acts of vandalism, and for the repair or removal of monuments
or  other markers not owned by the cemetery corporation that have fallen
into disrepair or dilapidation so as to create  a  dangerous  condition.
Such  fund shall be administered by a board of trustees comprised of the
secretary of state, the attorney general and the commissioner of health,
or their designees, who shall serve without additional compensation.
(2) The fund shall  be  financed  by  contributions  by  the  cemetery
corporations  of  not  more  than  five dollars ($5.00) per interment or
cremation in a manner to be determined by the New  York  state  cemetery
board.  No  contributions  shall  be collected upon the interment of the
cremains of a deceased person where a contribution  was  collected  upon
cremations.
(3)  The  moneys  of  the  fund  shall  be  expended  equally  for the
maintenance of abandoned cemeteries previously owned  by  a  corporation
incorporated pursuant to this chapter or the membership corporations law
and the repair of cemetery vandalism damage and the repair or removal of
monuments  or  other  markers  not  owned  by  the cemetery corporation,
provided,  however,  that  the  cemetery  board   may   determine   that
circumstances  necessitate an unequal distribution due to specific needs
and may provide for such distribution. For purposes of this section, the
maintenance  of  abandoned  cemeteries  may  include  the  ordinary  and
necessary  care  of  a  cemetery,  such  as the construction of cemetery
fences, placement of  cemetery  lights,  removal  of  grass  and  weeds,
demolition  or  restoration of any buildings or structures in disrepair,
the refilling of graves, the repair or removal  of  monuments  or  other
markers  not  owned  by  the  cemetery corporation that have fallen into
disrepair or  dilapidation  so  as  to  create  a  dangerous  condition,
replacement of cemetery doors and locks, and the care of crypts, niches,
grave  sites,  monuments, and memorials paid for by means of the general
fund  or  special  fund  or  the  income  applied  from  the   permanent
maintenance  fund,  perpetual  care fund or monument maintenance fund of
the abandoned cemetery. For the purposes of  this  paragraph,  the  term
"abandoned  cemetery"  may  include  cemeteries  in  imminent  danger of
abandonment as determined by the New York state cemetery board.
(4) Authorization for payments by  the  fund  for  maintenance  of  an
abandoned  cemetery  shall  be  made by the secretary of state only upon
approval by the cemetery board of an application by  a  municipality  or
other   solvent   not-for-profit  cemetery  corporation,  or  a  solvent
not-for-profit  cemetery  corporation  that  merges  with  an  abandoned
cemetery  in  a  city  pursuant to section fifteen hundred six-d of this
article, for fair and reasonable expenses required to  be  made  by  the
municipality,  other  solvent  not-for-profit  cemetery  corporation for
maintenance of  an  abandoned  cemetery,  or  a  solvent  not-for-profit
cemetery  corporation  that  merges with an abandoned cemetery in a city
pursuant to section fifteen hundred six-d  of  this  article;  provided,

however,  that the cemetery board shall not approve any such application
unless  the  municipality,   other   solvent   not-for-profit   cemetery
corporation,  or solvent not-for-profit cemetery corporation that merges
with an abandoned cemetery in a city pursuant to section fifteen hundred
six-d   of   this  article  acknowledges  that  the  responsibility  for
restoration and future  care,  preservation,  and  maintenance  of  such
cemetery   has  been  assumed  by  the  municipality  or  other  solvent
not-for-profit  cemetery  corporation,  or  the  solvent  not-for-profit
cemetery  corporation  that  merges with an abandoned cemetery in a city
pursuant to section fifteen hundred  six-d  of  this  article.  For  the
purposes  of  this  paragraph,  such  cemetery shall always be deemed an
abandoned cemetery.
(5) Authorization for payments by the fund for the repair of vandalism
damage shall be made by the secretary of state only on approval  by  the
New York state cemetery board which shall determine:
(i)  that  an act of vandalism to the extent described by the cemetery
corporation did take place;
(ii) that either a written report of the vandalism was filed with  the
local  police  or  sheriff's  department,  or,  that  the cemetery, upon
consent of the division, made a determination not  to  file  the  report
because  the publicity generated by filing the report would have adverse
consequences for the cemetery;
(iii) that the cost of repairs is fair and reasonable; and
(iv) that the cemetery corporation has been  unable  to  obtain  funds
from  the  lot  owner,  his  spouse,  devisees  or  descendants within a
reasonable period of time nor are there adequate funds in  the  cemetery
corporations  monument  maintenance  fund,  if  such  a  fund  has  been
established by the cemetery.
(6) Authorization for payments by the fund for the repair  or  removal
of  monuments  or  other  markers  not owned by the cemetery corporation
shall be made by the secretary of state only on approval by the New York
state cemetery board on application by the cemetery corporation showing:
(i) that the monuments or markers  are  so  badly  out  of  repair  or
dilapidated as to create a dangerous condition;
(ii) that the cost of remedying the condition is fair and reasonable;
(iii) that the cemetery corporation has given not less than sixty days
notice to the last known owner to repair or remove the monument or other
marker and the said owner has failed to do so within the time prescribed
in said notice.
(7)  The New York state cemetery board shall promulgate rules defining
standards of maintenance, as well as what type of vandalism  or  out  of
repair  or  dilapidated  monuments  or  other  markers shall qualify for
payment of repair or removal by the fund and the method  and  amount  of
payment of contributions described in subparagraph two of this paragraph
upon  the  recommendation  of the state cemetery board citizens advisory
council created by section  fifteen  hundred  seven-a  of  this  article
(State  cemetery  board  citizens  advisory council). The New York state
cemetery board shall approve or deny any application  made  pursuant  to
this  section  no  later  than  sixty  days after receipt of a completed
application.
(8) Nothing contained in this paragraph is to be construed as giving a
cemetery corporation an  "insurable  interest"  in  monuments  or  other
embellishments  on a plot, lot or part thereof, nor is it meant to imply
that the cemetery  corporation  has  any  responsibility  for  repairing
vandalism damage not covered by this fund, nor for repairing or removing
out of repair or dilapidated monuments or other markers not owned by the
cemetery  corporation, nor shall it constitute the doing of an insurance
business.