AB 293

Bill Subjects

Abstract

Existing law, the Cemetery and Funeral Act, establishes the Cemetery and Funeral Bureau within the Department of Consumer Affairs and sets forth its powers and duties relating to the regulation of cemeteries, crematoria, funeral establishments, and their personnel. Existing law requires all securities purchased by, and all money received from, the trustor, as defined, for deposit in trust to be placed in trust within 30 days of receipt by the funeral establishment pursuant to a trust agreement executed by the funeral establishment, the trustor, and the trustee. Existing law requires the trustee, upon the signature of a majority of the trustees, to deliver the corpus of the trust and any income accrued in trust, as specified. Existing law specifies that a willful violation of the act is a crime. Existing law, the Unclaimed Property Law, provides that all intangible personal property maintained in a deposit or account, and the income or increment on that property held in a fiduciary capacity for the benefit of another that has remained unclaimed by the owner for more than 3 years escheats to the state. Under existing law, a person who claims to have been the owner, as defined, of property paid or delivered to the Controller under that law may file a claim to the property or to the net proceeds from its sale. Existing law requires to Controller to consider each claim, as specified, to determine if the claimant is the owner. This bill, commencing January 1, 2023, would recast provisions of the Cemetery and Funeral Act to permit the corpus of the trust and any income accrued in the trust, including interest, dividends, and capital gains, to escheat to the state, in accordance with the Unclaimed Property Law, if for more than 3 years after the funds became payable and distributable, as defined, to the funeral establishment or the trustor, the beneficiary or trustor has not corresponded electronically or in writing concerning the property or otherwise indicated an interest. The bill would require a funeral establishment to report and pay or deliver all unclaimed preneed funeral trust funds, including the corpus of the trust, together with any income accrued, less a revocation fee, to the Controller, as specified. This bill would specify that all funds maintained in a preneed funeral trust held by a trustee for a funeral establishment that has been dissolved, sold, closed, or had its license revoked shall be returned to the beneficiary, trustor, or the legal representative of either the beneficiary or trustor within 30 days of providing specified written notice to the trustee according to specified procedures if the funeral establishment does not transfer its preneed funeral agreements, or within 30 days of the beneficiary, trustor, or legal representative canceling the preneed funeral agreement according to specified procedures if the funeral establishment transfers its agreements. In the case of a funeral establishment that does not transfer its preneed funeral agreements, the bill would provide that if that person cannot be located or if that person does not provide written direction to the trustee to return the funds to them within 6 months of receiving specified notice, the funds escheat to the state in accordance with the Unclaimed Property Law, as specified. The bill would make other conforming changes. This bill would require, commencing January 1, 2023, a funeral establishment that intends to cease engaging in business operations by reason of dissolution, closure, sale, or revocation to also send notices to the bureau, beneficiaries or trustors, or their legal representatives, and trustees of preneed funeral agreements, as provided. The bill would require the notices to include specified information depending on whether the funeral establishment plans to transfer or not transfer its agreements to a licensed successor funeral establishment. The bill would require the notices to be sent on forms developed by the bureau and would require the bureau to develop the forms by January 1, 2023. The bill would require the bureau to adopt and post on its internet website, by January 1, 2023, regulations regarding the type of proof the funeral establishment ceasing operations and the licensed successor funeral establishment are required to retain or provide. Because this bill would change the definition of a crime, the bill would impose a state-mandated local program. The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement. This bill would provide that no reimbursement is required by this act for a specified reason.