HB3617 94TH GENERAL ASSEMBLY

LRB094 08622 AMC 40930 b

94TH GENERAL ASSEMBLY
State of Illinois
2005 and 2006
HB3617

Introduced 2/24/2005, by Rep. William Davis

SYNOPSIS AS INTRODUCED:

See Index

Amends the Illinois Funeral or Burial Funds Act. Provides that a separate completed contract shall be issued for cemetery merchandise, cemetery services, or undeveloped interment, entombment, or inurnment spaces, and not covered by this Act, unless certain conditions are met. Provides that licenses and license renewals shall be issued for a 5-year term. Provides requirements for license renewal and makes conforming changes in other provisions. Amends the Crematory Regulation Act and the Illinois Pre-Need Cemetery Sales Act. Provides that licenses and license renewals shall be issued for a 5-year term. Provides requirements for license renewal and makes conforming changes in other provisions of the Acts. Adds additional contract requirements under the Illinois Pre-Need Cemetery Sales Act. Amends the Consumer Fraud and Deceptive Business Practices Act. Provides that no person authorized by law to sell funeral services on an at need basis may also sell cemetery services, cemetery merchandise, or interment, inurnment, or entombment spaces on an at need basis, unless the person is also authorized by law to sell such cemetery services, merchandise, or spaces and issues to the consumer a separate contract with the provider of such cemetery services, merchandise, or spaces. Provides requirements for completed contracts. Effective January 1, 2006.

FISCAL NOTE ACT MAY APPLY

A BILL FOR

AN ACT concerning regulation.

Be it enacted by the People of the State of Illinois, represented in the General Assembly:

Section 5. The Illinois Funeral or Burial Funds Act is amended by changing Sections 1a-1, 3a, 3a-5, and 3f and by adding Sections 3a-1, 3a-2, 3a-3, and 3a-4 as follows:

(225 ILCS 45/1a-1)

Sec. 1a-1. Pre-need contracts.

(a) It shall be unlawful for any seller doing business within this State to accept sales proceeds from a purchaser, either directly or indirectly by any means, unless the seller enters into a pre-need contract with the purchaser which meets the following requirements:

(1) It states the name and address of the principal office of the seller and the parent company of the seller, if any.

(2) It clearly identifies the provider's name and address, the purchaser, and the beneficiary, if other than the purchaser.

(2.5) If the provider has branch locations, the contract gives the purchaser the opportunity to identify the branch at which the funeral will be provided.

(3) It contains a complete description of the funeral merchandise and services to be provided and the price of the merchandise and services, and it clearly discloses whether the price of the merchandise and services is guaranteed or not guaranteed as to price.

(A) Each guaranteed price contract shall contain the following statement in 12 point bold type:

THIS CONTRACT GUARANTEES THE BENEFICIARY THE SPECIFIC GOODS AND SERVICES CONTRACTED FOR. NO ADDITIONAL CHARGES MAY BE REQUIRED. FOR DESIGNATED GOODS AND SERVICES, ADDITIONAL CHARGES MAY BE INCURRED FOR UNEXPECTED EXPENSES INCLUDING, BUT NOT LIMITED TO, CASH ADVANCES, SHIPPING OF REMAINS FROM A DISTANT PLACE, OR DESIGNATED HONORARIA ORDERED OR DIRECTED BY SURVIVORS.

(B) Except as provided in subparagraph (C) of this paragraph (3), each non-guaranteed price contract shall contain the following statement in 12 point bold type:

THIS CONTRACT DOES NOT GUARANTEE THE PRICE THE BENEFICIARY WILL PAY FOR ANY SPECIFIC GOODS OR SERVICES. ANY FUNDS PAID UNDER THIS CONTRACT ARE ONLY A DEPOSIT TO BE APPLIED TOWARD THE FINAL PRICE OF THE GOODS OR SERVICES CONTRACTED FOR. ADDITIONAL CHARGES MAY BE REQUIRED.

(C) If a non-guaranteed price contract may subsequently become guaranteed, the contract shall clearly disclose the nature of the guarantee and the time, occurrence, or event upon which the contract shall become a guaranteed price contract.

(4) It provides that if the particular supplies and services specified in the pre-need contract are unavailable at the time of delivery, the provider shall be required to furnish supplies and services similar in style and at least equal in quality of material and workmanship.

(5) It discloses any penalties or restrictions, including but not limited to geographic restrictions or the inability of the provider to perform, on the delivery of merchandise, services, or pre-need contract guarantees.

(6) Regardless of the method of funding the pre-need contract, the following must be disclosed:

(A) Whether the pre-need contract is to be funded by a trust, life insurance, or an annuity;

(B) The nature of the relationship among the person funding the pre-need contract, the provider, and the seller; and

(C) The impact on the pre-need contract of (i) any changes in the funding arrangement including but not limited to changes in the assignment, beneficiary designation, or use of the funds; (ii) any specific penalties to be incurred by the contract purchaser as a result of failure to make payments; (iii) penalties to be incurred or moneys or refunds to be received as a result of cancellations; and (iv) all relevant information concerning what occurs and whether any entitlements or obligations arise if there is a difference between the proceeds of the particular funding arrangement and the amount actually needed to pay for the funeral at-need.

(D) The method of changing the provider.

(b) All pre-need contracts are subject to the Federal Trade Commission Rule concerning the Cooling-Off Period for Door-to-Door Sales (16 CFR Part 429).

(c) No pre-need contract shall be sold in this State unless there is a provider for the services and personal property being sold. If the seller is not a provider, then the seller must have a binding agreement with a provider, and the identity of the provider and the nature of the agreement between the seller and the provider shall be disclosed in the pre-need contract at the time of the sale and before the receipt of any sales proceeds. A separate completed contract, as required by the Illinois Pre-Need Cemetery Sales Act, shall be issued for cemetery merchandise, cemetery services, or undeveloped interment, entombment, or inurnment spaces, as defined in the Illinois Pre-Need Cemetery Sales Act, and not covered by this Act, unless the seller is licensed under both Acts and all disclosures are in compliance with both Acts. The failure to disclose the identity of the provider, the nature of the agreement between the seller and the provider, or any changes thereto to the purchaser and beneficiary, or the failure to make the disclosures required in subdivision (a)(1), constitutes an intentional violation of this Act.

(d) All pre-need contracts must be in writing in at least 11 point type, numbered, and executed in duplicate. A signed copy of the pre-need contract must be provided to the purchaser at the time of entry into the pre-need contract. The Comptroller may by rule develop a model pre-need contract form which meets the requirements of this Act.

(e) The State Comptroller shall by rule develop a booklet for consumers in plain English describing the scope, application, and consumer protections of this Act. After the adoption of these rules, no pre-need contract shall be sold in this State unless (i) the seller distributes to the purchaser prior to the sale a booklet promulgated or approved for use by the State Comptroller; (ii) the seller explains to the purchaser the terms of the pre-need contract prior to the purchaser signing; and (iii) the purchaser initials a statement in the contract confirming that the seller has explained the terms of the contract prior to the purchaser signing.

(f) All sales proceeds received in connection with a pre-need contract shall be deposited into a trust account as provided in Section 1b and Section 2 of this Act, or shall be used to purchase a life insurance policy or tax-deferred annuity as provided in Section 2a of this Act.

(g) No pre-need contract shall be sold in this State unless it is accompanied by a funding mechanism permitted under this Act, and unless the seller is licensed by the Comptroller as provided in Section 3 of this Act. Nothing in this Act is intended to relieve sellers of pre-need contracts from being licensed under any other Act required for their profession or business, and being subject to the rules promulgated to regulate their profession or business, including rules on solicitation and advertisement.

(Source: P.A. 92-419, eff. 1-1-02.)

(225 ILCS 45/3a) (from Ch. 111 1/2, par. 73.103a)

Sec. 3a. Denial, nonrenewal, suspension, or revocation of license.

(a) The Comptroller may refuse to issue or renew or may suspend or revoke a license on any of the following grounds:

(1) The applicant or licensee has made any misrepresentations or false statements or concealed any material fact.

(2) The applicant or licensee is insolvent.

(3) The applicant or licensee has been engaged in business practices that work a fraud.

(4) The applicant or licensee has refused to give pertinent data to the Comptroller.

(5) The applicant or licensee has failed to satisfy any enforceable judgment or decree rendered by any court of competent jurisdiction against the applicant.

(6) The applicant or licensee has conducted or is about to conduct business in a fraudulent manner.

(7) The trust agreement is not in compliance with State or federal law.

(8) The fidelity bond is not satisfactory to the Comptroller.

(9) As to any individual required to be listed in the license application for license or license renewal, the individual has conducted or is about to conduct any business on behalf of the applicant in a fraudulent manner; has been convicted of any felony or misdemeanor, an essential element of which is fraud; has had a judgment rendered against him or her based on fraud in any civil litigation; has failed to satisfy any enforceable judgment or decree rendered against him or her by any court of competent jurisdiction; or has been convicted of any felony or any theft-related offense.

(10) The applicant or licensee, including any member, officer, or director thereof if the applicant or licensee is a firm, partnership, association or corporation and any shareholder holding more than 10% of the corporate stock, has violated any provision of this Act or any regulation, decision, order, or finding made by the Comptroller under this Act.

(11) The Comptroller finds any fact or condition existing which, if it had existed at the time of the original application for such license or license renewal , would have warranted the Comptroller in refusing the issuance or renewal of the license.

(b) Before refusal to issue or renew and before suspension or revocation of a license, the Comptroller shall hold a hearing to determine whether the applicant or licensee, hereinafter referred to as the respondent, is entitled to hold such a license. At least 10 days prior to the date set for such hearing, the Comptroller shall notify the respondent in writing that on the date designated a hearing will be held to determine his eligibility for a license and that he may appear in person or by counsel. Such written notice may be served on the respondent personally, or by registered or certified mail sent to the respondent's business address as shown in his latest notification to the Comptroller. At the hearing, both the respondent and the complainant shall be accorded ample opportunity to present in person or by counsel such statements, testimony, evidence and argument as may be pertinent to the charges or to any defense thereto. The Comptroller may reasonably continue such hearing from time to time.

The Comptroller may subpoena any person or persons in this State and take testimony orally, by deposition or by exhibit, in the same manner and with the same fees and mileage allowances as prescribed in judicial proceedings in civil cases.

Any authorized agent of the Comptroller may administer oaths to witnesses at any hearing which the Comptroller is authorized to conduct.

(Source: P.A. 92-419, eff. 1-1-02.)

(225 ILCS 45/3a-1 new)

Sec. 3a-1. Term of license.

(a) Any license that was issued under this Act before the effective date of this amendatory Act of the 94th General Assembly shall expire 5 years after the effective date of this amendatory Act of the 94th General Assembly and must thereafter be renewed as provided in this Act. Beginning on the effective date of this amendatory Act of the 94th General Assembly, a license or license renewal under this Act shall be issued for a 5-year term, which shall expire as provided in this Act.

(b) The Comptroller by rule may adopt a system under which licenses must be renewed by various dates during the year, coinciding with the due date of the annual report of the licensee or any extensions thereof.

(225 ILCS 45/3a-2 new)

Sec. 3a-2. Requirements for license renewal. In order to complete the license renewal process, the licensee shall submit a license renewal application to the Comptroller in writing signed by the applicant and duly verified on forms furnished by the Comptroller upon date of renewal. Each renewal application must contain all the following:

(1) An affirmative statement indicating the licensee's desire for renewal and agreement to abide by all applicable statutes and rules.

(2) A $25 nonrefundable renewal fee.

(3) A completed annual report.

(4) The following information for the applicant, and each member, officer, and director thereof, if the applicant is a firm, partnership, association, or corporation, and each shareholder holding more than 10% of the corporate stock, if the applicant is a corporation:

(A) His or her name and current address (both residence and place of business).

(B) A detailed statement of the individual's business experience for the 10 years immediately preceding the application.

(C) Any present or prior connection between the individual and any other person engaged in pre-need sales.

(D) Any felony or misdemeanor convictions of which fraud was an essential element and any charges or complaints lodged against the individual of which fraud was an essential element and that resulted in civil or criminal litigation.

(E) Any failure of the individual to satisfy an enforceable judgment entered against him or her based upon fraud.

(F) Any other information requested by the Comptroller relating to past business practices of the individual.

Since the information required by this item (4) may be confidential or contain proprietary information, this information shall not be available to other licensees or the general public and shall be used only for the lawful purposes of the Comptroller in enforcing this Act.

(5) A current statement of the applicant's assets and liabilities.

(6) The current name and address of the licensee's principal place of business at which the books, accounts, and records are available for examination by the Comptroller as required by this Act.

(7) The current names and addresses of the licensee's branch locations at which pre-need sales are conducted and that operate under the same license number as the applicant's principal place of business.

(8) The name of the current trustee and, if applicable, the names of the advisors to the trustee, including a copy of the current trust agreement under which the trust funds are held as required by this Act.

(9) Such other information as the Comptroller may reasonably require in order to determine whether the licensee's renewal application qualifies under this Act.

(225 ILCS 45/3a-3 new)

Sec. 3a-3. Remedy for delinquent license renewal.

(a) If a licensee continues to conduct activities requiring a license but fails to submit a completed license renewal application to the Comptroller within the time specified in this Act, the Comptroller shall impose upon the licensee a penalty in the amount of $5 per day for each day the renewal statement is not submitted. The Comptroller may abate all or part of the $5 daily penalty for good cause shown.

(b) In the event the renewal application is denied by the Comptroller, the renewal fee paid is not refundable.

(225 ILCS 45/3a-4 new)

Sec. 3a-4. License renewal process. Once the licensee has filed for license renewal, the expiring license shall remain in effect until the renewal has been issued. Upon approval of the Comptroller, the Comptroller shall issue a license renewal to be posted in the place of business of the licensee.

(225 ILCS 45/3a-5)

Sec. 3a-5. License requirements.

(a) Every license issued by the Comptroller shall state the number of the license, the business name and address of the licensee's principal place of business, each branch location also operating under the license, and the licensee's parent company, if any. The license shall be conspicuously posted in each place of business operating under the license. The Comptroller may issue such additional licenses as may be necessary for licensee branch locations upon compliance with the provisions of this Act governing an original issuance of a license for each new license.

(b) Individual salespersons representing a licensee shall not be required to obtain licenses in their individual capacities, but must acknowledge, by affidavit, that they have been provided with a copy of and have read this Act. The licensee shall retain copies of the affidavits of its sellers for its records and shall make the affidavits available to the Comptroller for examination upon request.

(c) The licensee shall be responsible for the activities of any person representing the licensee in selling or offering a pre-need contract for sale.

(d) Any person not selling on behalf of a licensee shall obtain its own license.

(e) No license shall be transferable or assignable without the express written consent of the Comptroller. A transfer of more than 50% of the ownership of any business licensed hereunder shall be deemed to be an attempted assignment of the license originally issued to the licensee for which consent of the Comptroller shall be required.

(f) Every license issued hereunder shall remain in force until it expires or has been suspended, surrendered, or revoked in accordance with this Act. The Comptroller, upon the request of an interested person or on his own motion, may issue new licenses to a licensee whose license or licenses have been revoked, if no factor or condition then exists which would have warranted the Comptroller to originally refuse the issuance of such license.

(Source: P.A. 92-419, eff. 1-1-02.)

(225 ILCS 45/3f)

Sec. 3f. Revocation of license.

(a) The Comptroller, upon determination that grounds exist for the nonrenewal, revocation or suspension of a license issued under this Act, may refuse to renew, revoke or suspend, if appropriate, the license issued to a licensee or to a particular branch office location with respect to which the grounds for the nonrenewal, revocation or suspension may occur or exist.

(b) Whenever a license is not renewed or is revoked by the Comptroller, he or she shall apply to the Circuit Court of the county wherein the licensee is located for a receiver to administer the trust funds of the licensee or to maintain the life insurance policies and tax-deferred annuities held by the licensee under a pre-need contract.

(Source: P.A. 92-419, eff. 1-1-02.)

Section 10. The Crematory Regulation Act is amended by changing Sections 11, 11.5, 13, and 62.10 and by adding Sections 10.1, 10.2, 10.3, and 10.4 as follows:

(410 ILCS 18/10.1 new)

Sec. 10.1. Term of license.

(a) Any license that was issued under this Act before the effective date of this amendatory Act of the 94th General Assembly shall expire 5 years after the effective date of this amendatory Act of the 94th General Assembly and must thereafter be renewed as provided in this Act. Beginning on the effective date of this amendatory Act of the 94th General Assembly, a license or license renewal shall be issued for a 5-year term, which shall expire as provided in this Act.

(b) The Comptroller by rule may adopt a system under which licenses must be renewed by various dates during the year, coinciding with the due date of the annual report of the licensee or any extensions thereof.

(410 ILCS 18/10.2 new)

Sec. 10.2. Requirements for license renewal. In order to complete the license renewal process, the licensee shall submit a license renewal application to the Comptroller in writing on forms furnished by the Comptroller upon date of renewal. Each renewal application shall contain all of the following:

(1) An affirmative statement indicating the licensee's desire for renewal and agreement to abide by all applicable statutes and rules.

(2) A $25 nonrefundable renewal fee.

(3) A completed annual report.

(4) The current name and address (both residence and business) of the licensee, if the licensee is an individual; the full name and address of every member, if the licensee is a partnership; the full name and address of every member of the board of directors, if the licensee is an association; and the name and address of every officer, director, and shareholder holding more than 25% of the corporate stock, if the licensee is a corporation.

(5) A description of the type of structure and equipment used in the operation of the crematory, including the operating permit number issued to the cremation device by the Illinois Environmental Protection Agency.

(6) An updated attestation by the owner that cremation services shall be by a person trained in accordance with the requirements of Section 22 of this Act.

(7) A copy of the certifications issued by the certification program to the person or persons who operate the cremation device.

(8) Any further information that the Comptroller reasonably may require.

(410 ILCS 18/10.3 new)

Sec. 10.3. Remedy for delinquent license renewal.

(a) If a licensee continues to conduct activities requiring a license but fails to submit a completed license renewal application to the Comptroller within the time specified in this Act, the Comptroller shall impose upon the licensee a penalty of $5 for each day the licensee remains delinquent in submitting the renewal application. The Comptroller may abate all or part of the $5 daily penalty for good cause shown.

(b) In the event the renewal application is denied by the Comptroller, the renewal fee paid is not refundable.

(410 ILCS 18/10.4 new)

Sec. 10.4. License renewal process. Once the licensee has filed for license renewal, the expiring license shall remain in effect until the renewal has been issued. Upon approval of the Comptroller, the Comptroller shall issue a license renewal to be posted in the place of business of the licensee.

(410 ILCS 18/11)

Sec. 11. Grounds for refusal of license or license renewal or suspension or revocation of license.

(a) In this Section, "applicant" means a person who has applied for a license or license renewal under this Act.

(b) The Comptroller may refuse to issue or renew a license under this Act, or may suspend or revoke a license issued under this Act, on any of the following grounds:

(1) The applicant or licensee has made any misrepresentation or false statement or concealed any material fact in connection with a license application or licensure under this Act.

(2) The applicant or licensee has been engaged in business practices that work a fraud.

(3) The applicant or licensee has refused to give information required under this Act to be disclosed to the Comptroller.

(4) The applicant or licensee has conducted or is about to conduct cremation business in a fraudulent manner.

(5) As to any individual listed in the license or license renewal application as required under Section 10 or 10.2, that individual has conducted or is about to conduct any cremation business on behalf of the applicant in a fraudulent manner or has been convicted of any felony or misdemeanor an essential element of which is fraud.

(6) The applicant or licensee has failed to make the annual report required by this Act or to comply with a final order, decision, or finding of the Comptroller made under this Act.

(7) The applicant or licensee, including any member, officer, or director of the applicant or licensee if the applicant or licensee is a firm, partnership, association, or corporation and including any shareholder holding more than 25% of the corporate stock of the applicant or licensee, has violated any provision of this Act or any regulation or order made by the Comptroller under this Act.

(8) The Comptroller finds any fact or condition existing that, if it had existed at the time of the original application for a license or license renewal under this Act, would have warranted the Comptroller in refusing the issuance of the license.

(Source: P.A. 92-675, eff. 7-1-03.)

(410 ILCS 18/11.5)

Sec. 11.5. License revocation or suspension; surrender of license.

(a) Upon determining that grounds exist for the nonrenewal, revocation, or suspension of a license issued under this Act, the Comptroller, if appropriate, may revoke, or suspend, or refuse to renew the license issued to the licensee.

(b) Upon the nonrenewal, revocation, or suspension of a license issued under this Act, the licensee must immediately surrender the license to the Comptroller. If the licensee fails to do so, the Comptroller may seize the license.

(Source: P.A. 92-675, eff. 7-1-03.)

(410 ILCS 18/13)

Sec. 13. License; display; transfer; duration.

(a) Every license issued under this Act must state the number of the license, the business name and address of the licensee's principal place of business, and the licensee's parent company, if any. The license must be conspicuously posted in the place of business operating under the license.

(b) No license is transferable or assignable without the express written consent of the Comptroller. A transfer of more than 50% of the ownership of any business licensed under this Act shall be deemed to be an attempted assignment of the license originally issued to the licensee for whom consent of the Comptroller is required.

(c) Every license issued under this Act shall remain in force until it expires or has been surrendered, suspended, or revoked in accordance with this Act. Upon the request of an interested person or on the Comptroller's own motion, the Comptroller may issue a new license to a licensee whose license has been revoked under this Act if no factor or condition then exists which would have warranted the Comptroller in originally refusing the issuance of the license.

(Source: P.A. 92-675, eff. 7-1-03.)

(410 ILCS 18/62.10)

Sec. 62.10. Investigation of actions; hearing.

(a) The Comptroller shall make an investigation upon discovering facts that, if proved, would constitute grounds for refusal, denial, suspension, or revocation of a license under this Act.

(b) Before refusing to issue or renew, and before suspending or revoking, a license under this Act, the Comptroller shall hold a hearing to determine whether the applicant for a license or the licensee ("the respondent") is entitled to hold such a license. At least 10 days before the date set for the hearing, the Comptroller shall notify the respondent in writing that (i) on the designated date a hearing will be held to determine the respondent's eligibility for a license and (ii) the respondent may appear in person or by counsel. The written notice may be served on the respondent personally, or by registered or certified mail sent to the respondent's business address as shown in the respondent's latest notification to the Comptroller. The notice must include sufficient information to inform the respondent of the general nature of the reason for the Comptroller's action.

(c) At the hearing, both the respondent and the complainant shall be accorded ample opportunity to present in person or by counsel such statements, testimony, evidence, and argument as may be pertinent to the charge or to any defense to the charge. The Comptroller may reasonably continue the hearing from time to time. The Comptroller may subpoena any person or persons in this State and take testimony orally, by deposition, or by exhibit, in the same manner and with the same fees and mileage as prescribed in judicial proceedings in civil cases. Any authorized agent of the Comptroller may administer oaths to witnesses at any hearing that the Comptroller is authorized to conduct.

(d) The Comptroller, at the Comptroller's expense, shall provide a certified shorthand reporter to take down the testimony and preserve a record of every proceeding at the hearing of any case involving the refusal to issue or renew a license under this Act, the suspension or revocation of such a license, the imposition of a monetary penalty, or the referral of a case for criminal prosecution. The record of any such proceeding shall consist of the notice of hearing, the complaint, all other documents in the nature of pleadings and written motions filed in the proceeding, the transcript of testimony, and the report and orders of the Comptroller. Copies of the transcript of the record may be purchased from the certified shorthand reporter who prepared the record or from the Comptroller.

(Source: P.A. 92-675, eff. 7-1-03.)

Section 15. The Illinois Pre-Need Cemetery Sales Act is amended by changing Sections 7, 8, 9, 12, and 14 and by adding Sections 6a, 6b, 6c, and 6d as follows:

(815 ILCS 390/6a new)

Sec. 6a. Term of license.

(a) Any license that was issued under this Act before the effective date of this amendatory Act of the 94th General Assembly shall expire 5 years after the effective date of this amendatory Act of the 94th General Assembly and must thereafter be renewed as provided in this Act. Beginning on the effective date of this amendatory Act of the 94th General Assembly, a license or license renewal shall be issued for a 5-year term, which shall expire as provided in this Act.

(b) The Comptroller by rule may adopt a system under which licenses must be renewed by various dates during the year, coinciding with the due date of the annual report of the licensee or any extensions thereof.

(815 ILCS 390/6b new)

Sec. 6b. Requirements for license renewal. In order to complete the license renewal process, the licensee shall submit a license renewal application to the Comptroller in writing under oath, signed by the applicant and in the form furnished by the Comptroller upon date of renewal. The Comptroller may prescribe abbreviated license renewal application forms for persons holding a license under the Cemetery Care Act. Each renewal application (except abbreviated applications) shall contain all of the following:

(1) An affirmative statement indicating the licensee's desire for renewal and agreement to abide by all applicable statutes and rules.

(2) A $25 nonrefundable renewal fee.

(3) A completed annual report.

(4) The following information for the applicant, and each member, officer, and director thereof, if the applicant is a firm, partnership, association, or corporation, and each shareholder holding more than 10% of the corporate stock, if the applicant is a corporation:

(A) His or her name and current address (both residence and place of business).

(B) A detailed statement of the individual's business experience for the 10 years immediately preceding the application.

(C) Any present or prior connection between the individual and any other person engaged in pre-need sales.

(D) Any felony or misdemeanor convictions of which fraud was an essential element and any charges or complaints lodged against the individual of which fraud was an essential element and that resulted in civil or criminal litigation.

(E) Any failure of the individual to satisfy an enforceable judgment entered against him or her based upon fraud.

(F) Any other information requested by the Comptroller relating to past business practices of the individual.

Since the information required by this item (4) may be confidential or contain proprietary information, this information shall not be available to other licensees or the general public and shall be used only for the lawful purposes of the Comptroller in enforcing this Act.

(5) A detailed statement of the licensee's current assets and liabilities.

(6) The current name and address of the licensee's principal place of business at which the books, accounts, and records are available for examination by the Comptroller as required by this Act.

(7) The current name and address of the licensee's branch locations at which pre-need sales are conducted and that operate under the same license number as the licensee's principal place of business.

(8) A current copy of the trust agreement under which the trust funds are to be held as required by this Act.

(9) Such other information as the Comptroller may reasonably require in order to determine whether the licensee's renewal application qualifies under this Act.

(815 ILCS 390/6c new)

Sec. 6c. Remedy for delinquent license renewal.

(a) If a licensee continues to conduct activities requiring a license but fails to submit a completed license renewal application to the Comptroller within the time specified in this Act, the Comptroller shall impose upon the licensee a penalty of $5 for each day the licensee remains delinquent in submitting the application. The Comptroller may abate all or part of the $5 daily penalty for good cause shown.

(b) In the event the renewal application is denied by the Comptroller, the renewal fee paid is not refundable.

(815 ILCS 390/6d new)

Sec. 6d. License renewal process. Once the licensee has filed for license renewal, the expiring license shall remain in effect until the renewal has been issued. Upon approval of the Comptroller, the Comptroller shall issue a license renewal to be posted in the place of business of the licensee.

(815 ILCS 390/7) (from Ch. 21, par. 207)

Sec. 7. The Comptroller may refuse to issue or renew a license or may suspend or revoke a license on any of the following grounds:

(a) The applicant or licensee has made any misrepresentations or false statements or concealed any material fact;

(b) The applicant or licensee is insolvent;

(c) The applicant or licensee has been engaged in business practices that work a fraud;

(d) The applicant or licensee has refused to give pertinent data to the Comptroller;

(e) The applicant or licensee has failed to satisfy any enforceable judgment or decree rendered by any court of competent jurisdiction against the applicant;

(f) The applicant or licensee has conducted or is about to conduct business in a fraudulent manner;

(g) The trust agreement is not in compliance with State or federal law;

(h) The pre-construction performance bond, if applicable, is not satisfactory to the Comptroller;

(i) The fidelity bond is not satisfactory to the Comptroller;

(j) As to any individual listed in the license application for license or license renewal as required pursuant to Section 6 or 6b, that individual has conducted or is about to conduct any business on behalf of the applicant in a fraudulent manner, has been convicted of any felony or misdemeanor an essential element of which is fraud, has had a judgment rendered against him or her based on fraud in any civil litigation, has failed to satisfy any enforceable judgment or decree rendered against him by any court of competent jurisdiction, or has been convicted of any felony or any theft-related offense;

(k) The applicant or licensee has failed to make the annual report required by this Act or to comply with a final order, decision, or finding of the Comptroller made pursuant to this Act;

(l) The applicant or licensee, including any member, officer, or director thereof if the applicant or licensee is a firm, partnership, association, or corporation and any shareholder holding more than 10% of the corporate stock, has violated any provision of this Act or any regulation or order made by the Comptroller under this Act; or

(m) The Comptroller finds any fact or condition existing which, if it had existed at the time of the original application for such license or renewal of such license would have warranted the Comptroller in refusing the issuance or renewal of the license.

(Source: P.A. 92-419, eff. 1-1-02.)

(815 ILCS 390/8) (from Ch. 21, par. 208)

Sec. 8. (a) Every license issued by the Comptroller shall state the number of the license, the business name and address of the licensee's principal place of business, each branch location also operating under the license, and the licensee's parent company, if any. The license shall be conspicuously posted in each place of business operating under the license. The Comptroller may issue additional licenses as may be necessary for license branch locations upon compliance with the provisions of this Act governing an original issuance of a license for each new license.

(b) Individual salespersons representing a licensee shall not be required to obtain licenses in their individual capacities but must acknowledge, by affidavit, that they have been provided a copy of and have read this Act. The licensee must retain copies of the affidavits of its salespersons for its records and must make the affidavits available to the Comptroller for examination upon request.

(c) The licensee shall be responsible for the activities of any person representing the licensee in selling or offering a pre-need contract for sale.

(d) Any person not selling on behalf of a licensee shall be required to obtain his or her own license.

(e) Any person engaged in pre-need sales, as defined herein, prior to the effective date of this Act may continue operations until the application for license under this Act is denied; provided that such person shall make application for a license within 60 days of the date that application forms are made available by the Comptroller.

(f) No license shall be transferable or assignable without the express written consent of the Comptroller. A transfer of more than 50% of the ownership of any business licensed hereunder shall be deemed to be an attempted assignment of the license originally issued to the licensee for which consent of the Comptroller shall be required.

(g) Every license issued hereunder shall remain in force until the same expires or has been suspended, surrendered or revoked in accordance with this Act, but the Comptroller, upon the request of an interested person or on his own motion, may issue new licenses to a licensee whose license or licenses have been revoked, if no factor or condition then exists which would have warranted the Comptroller in refusing originally the issuance of such license.

(Source: P.A. 92-419, eff. 1-1-02.)

(815 ILCS 390/9) (from Ch. 21, par. 209)

Sec. 9. The Comptroller may upon his own motion investigate the actions of any person providing, selling, or offering pre-need sales contracts or of any applicant or any person or persons holding or claiming to hold a license under this Act. The Comptroller shall make such an investigation on receipt of the verified written complaint of any person setting forth facts which, if proved, would constitute grounds for refusal to issue or renew, suspension, or revocation of a license. Before refusing to issue or renew, and before suspension or revocation of a license, the Comptroller shall hold a hearing to determine whether the applicant or licensee, hereafter called the respondent, is entitled to hold such a license. At least 10 days prior to the date set for such hearing, the Comptroller shall notify the respondent in writing that on the date designated a hearing will be held to determine his eligibility for a license and that he may appear in person or by counsel. Such written notice may be served on the respondent personally, or by registered or certified mail sent to the respondent's business address as shown in his latest notification to the Comptroller and shall include sufficient information to inform the respondent of the general nature of the charge. At the hearing, both the respondent and the complainant shall be accorded ample opportunity to present in person or by counsel such statements, testimony, evidence and argument as may be pertinent to the charges or to any defense thereto. The Comptroller may reasonably continue such hearing from time to time.

The Comptroller may subpoena any person or persons in this State and take testimony orally, by deposition or by exhibit, in the same manner and with the same fees and mileage as prescribed in judicial proceedings in civil cases.

Any authorized agent of the Comptroller may administer oaths to witnesses at any hearing which the Comptroller is authorized to conduct.

The Comptroller, at his expense, shall provide a certified shorthand reporter to take down the testimony and preserve a record of all proceedings at the hearing of any case involving the refusal to issue or renew a license, the suspension or revocation of a license, the imposition of a monetary penalty, or the referral of a case for criminal prosecution. The record of any such proceeding shall consist of the notice of hearing, complaint, all other documents in the nature of pleadings and written motions filed in the proceedings, the transcript of testimony and the report and orders of the Comptroller. Copies of the transcript of such record may be purchased from the certified shorthand reporter who prepared the record or from the Comptroller.

(Source: P.A. 92-419, eff. 1-1-02.)

(815 ILCS 390/12) (from Ch. 21, par. 212)

Sec. 12. License nonrenewal, revocation, or suspension.

(a) The Comptroller may, upon determination that grounds exist for the revocation or suspension or nonrenewal of a license issued under this Act, revoke or suspend, or fail to renew, if appropriate, the license issued to a licensee or to a particular branch office location with respect to which the grounds for revocation, or suspension, or failure to renew may occur or exist.

(b) Upon the nonrenewal, revocation, or suspension of any license, the licensee shall immediately surrender the license or licenses to the Comptroller. If the licensee fails to do so, the Comptroller has the right to seize the license or licenses.

(Source: P.A. 92-419, eff. 1-1-02.)

(815 ILCS 390/14) (from Ch. 21, par. 214)

Sec. 14. Contract required.

(a) It is unlawful for any person doing business within this State to accept sales proceeds, either directly or indirectly, by any means unless the seller enters into a pre-need sales contract with the purchaser which meets the following requirements:

(1) A written sales contract shall be executed in at least 11 point type in duplicate for each pre-need sale made by a licensee, and a signed copy given to the purchaser. Each completed contract shall be numbered and shall contain: (i) the name and address of the purchaser, the principal office of the licensee, and the parent company of the licensee; (ii) the name of the person, if known, who is to receive the cemetery merchandise, cemetery services or the completed interment, entombment or inurnment spaces under the contract; and (iii) specific identification of such merchandise, type of services to be held by cemetery or crematory personnel, or spaces to be provided, if a specific space or spaces are contracted for, and the price of the merchandise, services, or space or spaces; (iv) the location of the spaces to be provided, if a specific space is contracted for, indicated on an overall map of the site of the interment, entombment, or inurnment spaces; and (v) a description of the type of care furnished by a provider holding a valid license under the Cemetery Care Act that is being purchased to maintain the interment, entombment, or inurnment space, if a specific space is contracted for. If no care is included in the contract, the contract shall state in 11-point type "This contract does not include maintenance care.", and this statement shall be initialed by the purchaser.

(1.5) Each contract shall include a current copy of the provider's rules and regulations pertaining to the site of the completed interment, entombment, or inurnment spaces, if such spaces are to be provided under the contract.

(2) In addition, such contracts must contain a provision in distinguishing typeface as follows:

"Notwithstanding anything in this contract to the contrary, you are afforded certain specific rights of cancellation and refund under the Illinois Pre-Need Cemetery Sales Act, enacted by the 84th General Assembly of the State of Illinois".

(3) All pre-need sales contracts shall be sold on a guaranteed price basis. At the time of performance of the service or delivery of the merchandise, the seller shall be prohibited from assessing the purchaser or his heirs or assigns or duly authorized representative any additional charges for the specific merchandise and services listed on the pre-need sales contract.

(4) Each contract shall clearly disclose that the price of the merchandise or services is guaranteed and shall contain the following statement in 12 point bold type:

"THIS CONTRACT GUARANTEES THE BENEFICIARY THE SPECIFIC GOODS, SERVICES, INTERMENT SPACES, ENTOMBMENT SPACES, AND INURNMENT SPACES CONTRACTED FOR. NO ADDITIONAL CHARGES MAY BE REQUIRED FOR DESIGNATED GOODS, SERVICES, AND SPACES. ADDITIONAL CHARGES MAY BE INCURRED FOR UNEXPECTED EXPENSES."

(5) The pre-need sales contract shall provide that if the particular cemetery services, cemetery merchandise, or spaces specified in the pre-need contract are unavailable at the time of delivery, the seller shall be required to furnish services, merchandise, and spaces similar in style and at least equal in quality of material and workmanship.

(6) The pre-need contract shall also disclose any specific penalties to be incurred by the purchaser as a result of failure to make payments; and penalties to be incurred or moneys or refunds to be received as a result of cancellation of the contract.

(7) The pre-need contract shall disclose the nature of the relationship between the provider and the seller.

(8) Each pre-need contract that authorizes the delivery of cemetery merchandise to a licensed and bonded warehouse shall provide that prior to or upon delivery of the merchandise to the warehouse the title to the merchandise and a warehouse receipt shall be delivered to the purchaser or beneficiary. The pre-need contract shall contain the following statement in 12 point bold type:

"THIS CONTRACT AUTHORIZES THE DELIVERY OF MERCHANDISE TO A LICENSED AND BONDED WAREHOUSE FOR STORAGE OF THE MERCHANDISE UNTIL THE MERCHANDISE IS NEEDED BY THE BENEFICIARY. DELIVERY OF THE MERCHANDISE IN THIS MANNER MAY PRECLUDE REFUND OF SALE PROCEEDS THAT ARE ATTRIBUTABLE TO THE DELIVERED MERCHANDISE."

The purchaser shall initial the statement at the time of entry into the pre-need contract.

(9) Each pre-need contract that authorizes the placement of cemetery merchandise at the site of its ultimate use prior to the time that the merchandise is needed by the beneficiary shall contain the following statement in 12 point bold type:

"THIS CONTRACT AUTHORIZES THE PLACEMENT OF MERCHANDISE AT THE SITE OF ITS ULTIMATE USE PRIOR TO THE TIME THAT THE MERCHANDISE IS NEEDED BY THE BENEFICIARY. DELIVERY OF THE MERCHANDISE IN THIS MANNER MAY PRECLUDE REFUND OF SALE PROCEEDS THAT ARE ATTRIBUTABLE TO THE DELIVERED MERCHANDISE."

The purchaser shall initial the statement at the time of entry into the pre-need contract.

(b) Every pre-need sales contract must be in writing. The Comptroller may by rule develop a model pre-need sales contract form that meets the requirements of this Act.

(c) To the extent the Rule is applicable, every pre-need sales contract is subject to the Federal Trade Commission Rule concerning the Cooling-Off Period for Door-to-Door Sales (16 CFR Part 429).

(d) No pre-need sales contract may be entered into in this State unless there is a provider for the cemetery merchandise, cemetery services, and undeveloped interment, inurnment, and entombment spaces being sold. If the seller is not the provider, then the seller must have a binding agreement with a provider, and the identity of the provider and the nature of the agreement between the seller and the provider must be disclosed in the pre-need sales contract at the time of sale and before the receipt of any sale proceeds. The purchaser shall make personal contact with the provider and visit the site of the undeveloped interment, inurnment, or entombment spaces being sold, unless the purchaser waives his or her right to do so. Each pre-need contract that is sold by a seller who is not the provider shall contain the following statements in 12-point bold type and the applicable statements shall be initialed by the purchaser:

"I HAVE MADE PERSONAL CONTACT WITH THE PROVIDER OF THE CEMETERY MERCHANDISE, CEMETERY SERVICES, OR UNDEVELOPED INTERMENT, INURNMENT, OR ENTOMBMENT SPACES SOLD IN THIS CONTRACT.

I HAVE VISITED THE SITE OF THE UNDEVELOPED INTERMENT, INURNMENT, OR ENTOMBMENT SPACES SOLD IN THIS CONTRACT.

I HAVE WAIVED MY RIGHT TO MAKE PERSONAL CONTACT AND/OR VISIT THE PROVIDER OF THE CEMETERY MERCHANDISE, CEMETERY SERVICES, OR UNDEVELOPED INTERMENT, INURNMENT, OR ENTOMBMENT SPACES BEING SOLD IN THIS CONTRACT.

A COPY OF THE PROVIDER'S RULES AND REGULATIONS HAS BEEN MADE AVAILABLE TO ME."

A separate completed contract shall be issued for funeral merchandise or funeral services covered by the Illinois Funeral or Burial Funds Act, and not covered by this Act, unless the seller is licensed under both Acts and all disclosures are in compliance with both Acts. The failure to disclose the identity of the provider, the nature of the agreement between the seller and the provider, or any changes thereto to the purchaser and beneficiary, or the failure to make the disclosures required by this Section constitutes an intentional violation of this Act.

(e) No pre-need contract may be entered into in this State unless it is accompanied by a funding mechanism permitted under this Act and unless the seller is licensed by the Comptroller as provided in this Act. Nothing in this Act is intended to relieve providers or sellers of pre-need contracts from being licensed under any other Act required for their profession or business or from being subject to the rules promulgated to regulate their profession or business, including rules on solicitation and advertisement.

(f) No pre-need contract may be entered into in this State unless the seller explains to the purchaser the terms of the pre-need contract prior to the purchaser signing and the purchaser initials a statement in the contract confirming that the seller has explained the terms of the contract prior to the purchaser signing.

(g) The State Comptroller shall develop a booklet for consumers in plain English describing the scope, application, and consumer protections of this Act. After the booklet is developed, no pre-need contract may be sold in this State unless the seller distributes to the purchaser prior to the sale a booklet developed or approved for use by the State Comptroller.

(Source: P.A. 91-7, eff. 1-1-00; 92-419, eff. 1-1-02.)

Section 20. The Consumer Fraud and Deceptive Business Practices Act is amended by adding Section 2VV as follows:

(815 ILCS 505/2VV new)

Sec. 2VV. Cemetery or funeral contracts. No person authorized by law to sell funeral services on an at need basis may also sell cemetery services, cemetery merchandise, or interment, inurnment, or entombment spaces on an at need basis, unless the person is also authorized by law to sell such cemetery services, merchandise, or spaces and issues to the consumer a separate contract with the provider of such cemetery services, merchandise, or spaces.

Each completed contract shall be numbered and shall contain: (i) the name and address of the purchaser, the name and pertinent information of the person who is to receive the cemetery services, merchandise, or spaces, and the name and address of the seller; (ii) specific identification of such merchandise, type of services to be held by cemetery or crematory personnel, or spaces to be provided and the price of the merchandise, services, or spaces; (iii) the location of the space to be provided, if a specific space is contracted for, indicated on an overall map of the site of the interment, entombment, or inurnment space; and (iv) a description of the type of care furnished by a provider holding a valid license under the Cemetery Care Act that is being purchased to maintain the interment, entombment, or inurnment space, if a specific space is contracted for. If no care is included in the contract, the contract shall state in 11-point bold type: "This contract does not include maintenance care.", and this statement shall be initialed by the purchaser. Each contract shall include a current copy of the provider's rules and regulations pertaining to the site of the interment, entombment, or inurnment spaces, if such spaces are to be provided under the contract. The purchaser shall make personal contact with the provider and visit the site of the undeveloped interment, inurnment, or entombment spaces being sold, unless the purchaser waives his or her right to do so. Each contract that is sold by a seller who is not the provider shall contain the following statements in 12-point bold type and the applicable statements shall be initialed by the purchaser:

"I HAVE MADE PERSONAL CONTACT WITH THE PROVIDER OF THE CEMETERY MERCHANDISE, CEMETERY SERVICES, OR INTERMENT, INURNMENT, OR ENTOMBMENT SPACES SOLD IN THIS CONTRACT.

I HAVE VISITED THE SITE OF THE INTERMENT, INURNMENT, OR ENTOMBMENT SPACES SOLD IN THIS CONTRACT.

I HAVE WAIVED MY RIGHT TO MAKE PERSONAL CONTACT AND VISIT THE PROVIDER OF THE CEMETERY MERCHANDISE, CEMETERY SERVICES, OR INTERMENT, INURNMENT, OR ENTOMBMENT SPACES BEING SOLD IN THIS CONTRACT." Any person who violates this Section commits an unlawful practice within the meaning of this Act.

Section 99. Effective date. This Act takes effect January 1, 2006.