1-1 By: Marchant (Senate Sponsor - Montford) H.B. No. 2499
1-2 (In the Senate - Received from the House April 20, 1993;
1-3 April 21, 1993, read first time and referred to Committee on
1-4 Economic Development; May 11, 1993, reported adversely, with
1-5 favorable Committee Substitute by the following vote: Yeas 9, Nays
1-6 0; May 11, 1993, sent to printer.)
1-7 COMMITTEE VOTE
1-8 Yea Nay PNV Absent
1-9 Parker x
1-10 Lucio x
1-11 Ellis x
1-12 Haley x
1-13 Harris of Dallas x
1-14 Harris of Tarrant x
1-15 Leedom x
1-16 Madla x
1-17 Rosson x
1-18 Shapiro x
1-19 Wentworth x
1-20 COMMITTEE SUBSTITUTE FOR H.B. No. 2499 By: Haley
1-21 A BILL TO BE ENTITLED
1-22 AN ACT
1-23 relating to prepaid funeral services or merchandise.
1-24 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-25 SECTION 1. Chapter 512, Acts of the 54th Legislature,
1-26 Regular Session, 1955 (Article 548b, Vernon's Texas Civil
1-27 Statutes), is amended to read as follows:
1-28 Sec. 1. PURPOSE; DEFINITIONS; PERMITS. (a) This Act
1-29 provides limits on the manner in which a person is permitted to
1-30 accept funds in prepayment of funeral services to be performed in
1-31 the future. The purpose of this Act is to:
1-32 (1) provide a regulatory framework so that members of
1-33 the public have an opportunity to arrange and pay for funerals for
1-34 themselves and their families in advance of need; and
1-35 (2) provide all safeguards to protect the prepaid
1-36 funds and to assure that the prepaid funds will be available to pay
1-37 for the prearranged funeral services.
1-38 (b) In this Act:
1-39 (1) "Affiliate" means a person or entity directly or
1-40 indirectly controlling, controlled by, or under common control with
1-41 a permit holder or the funeral provider.
1-42 (2) "Commissioner" means the Banking Commissioner of
1-43 Texas.
1-44 (3) "Department" means the Banking Department of
1-45 Texas.
1-46 (4) "Earnings" means the amount in an account in
1-47 excess of the amount paid by the purchaser of a prepaid funeral
1-48 benefits contract and deposited or placed in the account as
1-49 provided by Section 5(a)(2) of this Act. The term includes accrued
1-50 interest, accrued income, and enhanced or increased value.
1-51 (5) "Funeral provider" means the funeral home
1-52 designated in a prepaid funeral benefits contract that has agreed
1-53 and obligated itself to provide the specified prepaid funeral
1-54 benefits.
1-55 (6) "Insurance policy" means a life insurance policy
1-56 or annuity contract.
1-57 (7) "Permit holder" means a person having a valid
1-58 permit to sell prepaid funeral benefits.
1-59 (8) "Person" means any individual, firm, partnership,
1-60 corporation, or association.
1-61 (9) "Prepaid funeral benefits" means prearranged or
1-62 prepaid funeral or cemetery services or funeral merchandise,
1-63 including caskets, grave vaults, and all other articles of
1-64 merchandise incidental to a funeral service. The term does not
1-65 include a grave lot, grave space, grave marker, monument,
1-66 tombstone, crypt, niche, or mausoleum unless it is sold in
1-67 contemplation of trade or barter for services and merchandise to
1-68 which this Act applies.
2-1 (10) "Seller" means a person selling, accepting funds
2-2 or premiums for, or soliciting contracts for prepaid funeral
2-3 benefits or contracts or policies of insurance to fund prepaid
2-4 funeral benefits in this state.
2-5 (11) "Trustee" means the person named as trustee in
2-6 the instruments creating a prepaid funeral trust.
2-7 (c) Unless a person holds a permit issued under this Act,
2-8 the person may not:
2-9 (1) sell prepaid funeral benefits, or accept funds for
2-10 prepaid funeral benefits, in this state under any contract; or
2-11 (2) solicit the designations by an individual of the
2-12 prepaid funeral benefits to be provided out of any fund,
2-13 investment, security, or contract, including contracts or policies
2-14 of insurance authorized, and sold under a license issued, by the
2-15 State Board of Insurance, to be created or purchased by that
2-16 individual at the suggestion or solicitation of the seller.
2-17 (d) A seller who violates Subsection (c) of this section is
2-18 not entitled to enforce a prepaid funeral benefits contract but the
2-19 purchaser or the purchaser's heirs or legal representative is
2-20 entitled to recover:
2-21 (1) all amounts paid to the seller under that
2-22 contract; and
2-23 (2) all amounts paid to any fund or for any
2-24 investment, security, or contract, including contracts or policies
2-25 of insurance authorized by the State Board of Insurance.
2-26 (e) Delivery of funeral merchandise before death is not
2-27 performance or fulfillment, in whole or in part, of a prepaid
2-28 funeral benefits contract entered into after the effective date of
2-29 this Act.
2-30 (f) A seller may not increase the sales price of an item not
2-31 covered by this Act for the purpose of allocating a lesser sales
2-32 price to an item that is covered by this Act.
2-33 (g) All funds received in exchange for prepaid funeral
2-34 benefits shall be administered as prescribed by:
2-35 (1) Section 1A of this Act governing insurance-funded
2-36 prepaid funeral benefits; or
2-37 (2) Section 5 of this Act governing trust-funded
2-38 prepaid funeral benefits.
2-39 (h) Without the prior written consent of the Commissioner, a
2-40 holder of prepaid funeral funds designated under Section 5(a)(2) of
2-41 this Act may not use those funds to purchase, lease, or otherwise
2-42 invest in an asset owned by the seller or funeral provider or an
2-43 affiliate of the seller or funeral provider.
2-44 (i) The Commissioner by order may disapprove a transaction
2-45 described by Subsection (h) of this section on the ground that it
2-46 would materially adversely affect the interests of the purchasers
2-47 of prepaid funeral benefits contracts. The Commissioner shall
2-48 approve or disapprove the transaction within 30 days after the date
2-49 of the receipt of written notification by the permit holder.
2-50 Failure to act within that period constitutes approval of the
2-51 transaction. Unless the permit holder requests a hearing within 10
2-52 days after the date of the order of disapproval, the order shall
2-53 become effective as proposed. If the permit holder requests a
2-54 hearing within the 10-day period, it shall be conducted in
2-55 accordance with the procedures for a contested case hearing under
2-56 the Administrative Procedure and Texas Register Act (Article
2-57 6252-13a, Vernon's Texas Civil Statutes) and its subsequent
2-58 amendments. <Any individual, firm, partnership, corporation, or
2-59 association (hereinafter called "organization" or "seller")
2-60 desiring to sell prearranged or prepaid funeral services or funeral
2-61 merchandise (including caskets, grave vaults, and all other
2-62 articles of merchandise incidental to a funeral service, but
2-63 excluding grave lots, grave spaces, grave markers, monuments,
2-64 tombstones, crypts, niches, and mausoleums), or accepting funds for
2-65 such services or merchandise, in this state, under any contract,
2-66 expressed or implied, providing for prepaid burial or funeral
2-67 benefits or merchandise (hereinafter called "prepaid funeral
2-68 benefits"), or who shall solicit the designations by an individual
2-69 of the items of funeral merchandise or services which he desires to
2-70 be provided out of any fund, investment, security, or contract to
3-1 be created or purchased by such individual at the suggestion or
3-2 solicitation of the organization shall obtain a permit from the
3-3 State Banking Department (hereinafter called Department) of this
3-4 state authorizing the transaction of this type of business, before
3-5 conducting such business. Seller shall not be entitled to enforce
3-6 a contract made in violation of this Act, but the purchaser or his
3-7 heirs, or legal representative, shall be entitled to recover all
3-8 amounts paid to the seller under any contract made in violation
3-9 thereof, and all amounts paid whether or not paid seller, to any
3-10 fund or for any investment, security, or contract where the seller
3-11 has violated the provisions of this Act. Delivery of funeral
3-12 merchandise prior to death shall not constitute performance or
3-13 fulfillment, either wholly or in part, of any prepaid funeral
3-14 benefits contract entered into after the effective date of this
3-15 amendatory Act.>
3-16 <Provided, however, that grave lots, grave spaces, grave
3-17 markers, monuments, tombstones, crypts, niches, and mausoleums
3-18 shall not be excluded from the provisions of this Section when
3-19 these items and articles are sold in contemplation of trade or
3-20 barter for services and articles designated as included by the
3-21 provisions of this Section.>
3-22 Sec. 1A <1a>. INSURANCE FUNDED PREPAID FUNERAL BENEFITS.
3-23 (a) No seller <organization> covered by this Act shall solicit by
3-24 any means whatsoever the designation by an individual of prepaid
3-25 funeral benefits <funeral services or merchandise which he desires>
3-26 to be provided to be paid out of any fund, investment, security, or
3-27 contract, including insurance policies, to be created or purchased
3-28 by or for such an individual at the suggestion or solicitation of
3-29 the seller <organization>, unless such a fund is to be created by a
3-30 life insurance policy or an annuity contract approved by the Board
3-31 of Insurance and issued by <with> an insurance company licensed by
3-32 the Board of Insurance or except as provided for trust-funded
3-33 prepaid funeral benefits by Section 5 of this Act <in Texas>, or
3-34 unless such fund, investment, security, or contract shall have been
3-35 approved by the Department as safeguarding the right and interests
3-36 of the individual, his heirs and assigns, to substantially the same
3-37 or greater degree as is provided with respect to funds regulated by
3-38 Section 5 hereof. An insurance-funded prepaid funeral benefits
3-39 contract must be executed in conjunction with the application for
3-40 the issuance of the insurance policy.
3-41 (b) The <Provided, however, that the> Department may require
3-42 evidence of payment of premiums on any life insurance policy, or an
3-43 annuity contract used to create a fund to guarantee prepaid funeral
3-44 benefits. Any seller failing to provide such evidence to the
3-45 Department after being so requested by written notice shall be
3-46 subject to cancellation of its permit under the provisions of
3-47 Section 4 of this Act. A seller shall remit all premiums collected
3-48 for insurance policies or annuity contracts funding prepaid funeral
3-49 benefits to the insurance company within 30 days after the date of
3-50 collection.
3-51 (c) On the death of a beneficiary named in an
3-52 insurance-funded prepaid funeral benefits contract, the seller or
3-53 funeral provider, after completion of the funeral service and
3-54 presentation to the insurance company of proper affidavits signed
3-55 and sworn to by an officer or designated agent of the seller on
3-56 forms prescribed by the Department, together with a certified copy
3-57 of the death certificate, may withdraw the benefits payable under
3-58 that policy. The seller shall maintain copies of those affidavits
3-59 and death certificate for examination by the Department.
3-60 (d) A conversion from trust-funded prepaid funeral benefits
3-61 to insurance-funded prepaid funeral benefits must be approved by
3-62 the Department as safeguarding the rights and interests of the
3-63 individual who purchases the prepaid funeral benefits contract.
3-64 Each contract holder shall be notified in writing of the terms of
3-65 the proposed conversion and of the holder's right to decline the
3-66 conversion. Applications for approval of conversions from
3-67 trust-funded prepaid funeral benefits to insurance-funded prepaid
3-68 funeral benefits must be filed with the Department on forms
3-69 prescribed by the Department and accompanied by conversion
3-70 application fees established by the Department under Section 2 of
4-1 this Act.
4-2 (e) The cancellation of an insurance-funded prepaid funeral
4-3 benefits contract shall be handled as provided by Section 5(b) of
4-4 this Act.
4-5 Sec. 2. ADMINISTRATION OF ACT; CONTRACTS. This law shall be
4-6 administered by the <State Banking> Department. The Department is
4-7 authorized to prescribe reasonable rules and regulations concerning
4-8 <application> fees to defray the cost of administering this Act,
4-9 but may not maintain unnecessary fund balances, and fee amounts
4-10 shall be set in accordance with this requirement, the keeping and
4-11 inspection of records relating to the sale of prepaid funeral
4-12 benefits, the filing of contracts and reports, changes in
4-13 management or control of an organization, and all other matters
4-14 incidental to the enforcement and orderly administration of this
4-15 law; and the Department shall <may> approve forms for sales
4-16 contracts for prepaid funeral benefits before their use. All such
4-17 contracts must be in writing and no contract form shall be used
4-18 without prior approval of the Department. All such contracts shall
4-19 state the name of the funeral home or other person <organization>
4-20 primarily responsible for providing the prepaid funeral benefits
4-21 <funeral services or merchandise> specified in such contracts. In
4-22 the event the seller is not the funeral home designated to provide
4-23 the specified prepaid funeral benefits <funeral services or
4-24 merchandise>, such contract shall not be valid unless the funeral
4-25 home so designated is a party to the contract and therein agrees
4-26 and obligates itself to provide such specified prepaid funeral
4-27 benefits <funeral services or merchandise>. It is further
4-28 provided, that all <prearranged or> prepaid funeral benefits
4-29 contracts shall set forth the particulars of the funeral
4-30 merchandise, including a description and specifications of the
4-31 material used in the caskets or grave vaults to be furnished, and
4-32 such contracts shall set forth the particulars of the prepaid
4-33 funeral benefits <professional services to be performed and the
4-34 funeral home facilities and automotive equipment> to be provided.
4-35 Sec. 3. PERMIT. Each person <organization> desiring to sell
4-36 or to continue to sell prepaid funeral benefits shall file an
4-37 application for a one-year permit with the Department on a form
4-38 prescribed by the Department. The applicant <and> shall pay a
4-39 filing fee in an amount set by the Department under Section 2 of
4-40 this Act and extraordinary expenses required for out of state
4-41 investigation of the applicant, if applicable <of $250>. The
4-42 Commissioner may conduct an investigation of the applicant for the
4-43 initial permit, and if the Commissioner finds that the business
4-44 ability, experience, character, financial condition, and general
4-45 fitness of the applicant warrants the confidence of the public, the
4-46 Commissioner shall approve <grant> the application and issue a
4-47 permit to the applicant. If the Commissioner finds otherwise, the
4-48 Commissioner shall notify the applicant, who is entitled to a
4-49 hearing on the application, on request, within 60 days after the
4-50 date of the request, to be conducted in accordance with the
4-51 procedures for a contested case hearing under the Administrative
4-52 Procedure and Texas Register Act (Article 6252-13a, Vernon's Texas
4-53 Civil Statutes) and its subsequent amendments. The Department by
4-54 rule may adopt a system under which permits expire on various dates
4-55 during the year. The Commissioner may refuse to renew a permit if
4-56 the applicant has committed one or more of the acts described by
4-57 Section 4(a) of this Act and has not corrected the violation within
4-58 30 days after the date of written notice from the Commissioner.
4-59 The fee for renewal shall be set by the Department under Section 2
4-60 of this Act <is $60>.
4-61 Sec. 4. ENFORCEMENT. (a) The Commissioner may issue an
4-62 order to cancel, suspend, or refuse to renew a permit issued to a
4-63 person under this Act to sell prepaid funeral benefits if the
4-64 Commissioner finds, by examination or other credible evidence, that
4-65 the person:
4-66 (1) has violated this Act or another law of this
4-67 state, including a final order or rule of the Commissioner or the
4-68 Department, relating to the sale of prepaid funeral benefits;
4-69 (2) has misrepresented or concealed a material fact in
4-70 the application for the permit; or
5-1 (3) has obtained, or attempted to obtain, the permit
5-2 by misrepresentation, concealment, or fraud.
5-3 (b) In addition to other penalties that may be imposed under
5-4 this Act, the Commissioner may bring a civil action in a district
5-5 court in Travis County to enjoin a violation or threatened
5-6 violation of this Act or a final order or rule of the Commissioner
5-7 or the Department.
5-8 (c) The Commissioner may issue an order to cease and desist
5-9 if the Commissioner finds, by examination or other credible
5-10 evidence, that a person has violated this Act or another law of
5-11 this state, including a final order or rule of the Commissioner or
5-12 the Department, relating to the sale of prepaid funeral benefits.
5-13 (d) An order proposed under Subsection (a) or (c) of this
5-14 section shall be served on the person named and shall state the
5-15 grounds for the proposed order with reasonable certainty and the
5-16 proposed effective date, which may not be before the 16th day after
5-17 the date of its mailing by certified mail, return receipt
5-18 requested, to the person's last known address. Unless the person
5-19 named in the order requests a hearing within 15 days after that
5-20 mailing, the order becomes effective as proposed. If the person
5-21 named requests a hearing, it shall be conducted in accordance with
5-22 the procedures for a contested case hearing under the
5-23 Administrative Procedure and Texas Register Act (Article 6252-13a,
5-24 Vernon's Texas Civil Statutes) and its subsequent amendments.
5-25 (e) Following cancellation of or failure to renew a permit
5-26 under Subsection (a) of this section or on notice to a person
5-27 required to obtain a permit under this Act, the Commissioner may
5-28 issue an order to seize all prepaid funeral funds, including
5-29 earnings, wherever those funds are held and may issue an order to
5-30 seize any or all records that relate to the sale of prepaid funeral
5-31 benefits, if the Commissioner finds, by examination or other
5-32 credible evidence, that the person:
5-33 (1) has failed to deposit or remit funds in accordance
5-34 with Section 1A or 5 of this Act;
5-35 (2) has misappropriated, converted, or illegally
5-36 withheld or failed or refused to pay on proper demand any money
5-37 entrusted to the person belonging to the beneficiary under a
5-38 prepaid funeral benefits contract;
5-39 (3) has refused to submit to examination by the
5-40 Department;
5-41 (4) has been the subject of an order to cancel,
5-42 suspend, or refuse to renew a permit; or
5-43 (5) does not hold a valid permit or has transferred
5-44 the ownership of its business to an acquiror that does not hold a
5-45 valid permit and that:
5-46 (A) has not applied for a new permit within 30
5-47 days after the date of the consummation of the transfer; or
5-48 (B) has been denied a new permit.
5-49 (f) An order under Subsection (e) is effective instanter if
5-50 the Commissioner finds that immediate and irreparable harm is
5-51 threatened to a beneficiary under a prepaid funeral benefits
5-52 contract. If such a threat does not exist, the order shall state
5-53 the proposed effective date, which may not be before the 16th day
5-54 after the date of mailing by certified mail, return receipt
5-55 requested, to the person's last known address. Unless the person
5-56 named in the order requests a hearing within 15 days after that
5-57 mailing, the order becomes effective as proposed. If the person
5-58 named requests a hearing, it shall be conducted in accordance with
5-59 the Administrative Procedure and Texas Register Act (Article
5-60 6252-13a, Vernon's Texas Civil Statutes) and its subsequent
5-61 amendments.
5-62 (g) Within 30 days after the date of a seizure of funds, the
5-63 Commissioner may notify all known parties who purchased prepaid
5-64 funeral benefits contract obligations from the person whose permit
5-65 was cancelled. The notice shall include an explanation of the
5-66 procedures under this Act for cancelling the contracts and claiming
5-67 funds that may be due to the parties if they elect to cancel. The
5-68 notice shall instruct those parties how to continue making payments
5-69 due under the contracts if they elect to keep the contracts in
5-70 force. The notice shall instruct those parties that if they elect
6-1 to keep the contracts in force the Commissioner will transfer
6-2 responsibility to perform the contracts to a responsible successor
6-3 permit holder selected by the Commissioner or transfer the seized
6-4 funds to the guaranty fund, subject to the claims process
6-5 prescribed by rule under Section 8A of this Act. A successor
6-6 permit holder to whom a contract is transferred by the Commissioner
6-7 assumes responsibility to perform the contract and is entitled to
6-8 retain all funds that would have been due the person whose permit
6-9 was cancelled, including any funds seized by the Commissioner. The
6-10 Department shall adopt rules governing selection of a successor
6-11 permit holder. Any premium received through the selection process
6-12 that exceeds the claims against the prior permit holder shall be
6-13 paid into the guaranty fund.
6-14 (h) The Commissioner may issue an order to a person
6-15 requiring restitution if, after notice and opportunity for hearing
6-16 held in accordance with the procedures for a contested case hearing
6-17 under the Administrative Procedure and Texas Register Act (Article
6-18 6252-13a, Vernon's Texas Civil Statutes) and its subsequent
6-19 amendments, the Commissioner finds that the person:
6-20 (1) has failed to deposit funds in accordance with
6-21 Section 5 of this Act; or
6-22 (2) has misappropriated, converted, or illegally
6-23 withheld or failed or refused to pay on proper demand any money
6-24 entrusted to the person belonging to the beneficiary under any
6-25 prepaid funeral benefits contract.
6-26 (i) In addition to any other penalties that may be imposed
6-27 under this Act, a person who violates this Act or a final order or
6-28 rule of the Commissioner or Department is subject to a civil
6-29 penalty unless within 30 days after the date of receiving written
6-30 notice from the Department of the violation, the person corrects
6-31 the violation by performing the required duty or act. A civil
6-32 penalty may not exceed $1,000 per violation for each day that the
6-33 violation persists.
6-34 (j) A civil penalty may be imposed by the Commissioner after
6-35 notice and opportunity for hearing in accordance with the
6-36 procedures for a contested case hearing under the Administrative
6-37 Procedure and Texas Register Act (Article 6252-13a, Vernon's Texas
6-38 Civil Statutes) and its subsequent amendments. In determining the
6-39 amount of the penalty, the Commissioner shall consider the
6-40 seriousness of the violation and the good faith of the person
6-41 charged in attempting to comply with this Act. The amount of the
6-42 penalty may be collected by the Commissioner in the same manner
6-43 that money judgements are enforced in the district courts of this
6-44 state.
6-45 (k) After an order issued by the Commissioner to seize funds
6-46 or records under Subsection (e) of this section has become final
6-47 and not subject to appeal, the Commissioner may petition the
6-48 district court in the county of residence of a person required to
6-49 hold a permit under this Act, requesting the issuance of an order
6-50 to show cause why the business and affairs of that person should
6-51 not be liquidated and a receiver appointed by the court to
6-52 accomplish that purpose if the person has committed one or more of
6-53 the following acts and has failed or refused to correct the
6-54 violations within 30 days after the date on which the person
6-55 received written notice from the Commissioner:
6-56 (1) failed to deposit funds in accordance with Section
6-57 5 of this Act;
6-58 (2) misappropriated, converted, or illegally withheld
6-59 or failed or refused to pay over upon proper demand any money
6-60 entrusted to that person belonging to the beneficiary under any
6-61 prepaid funeral benefits contract; or
6-62 (3) allowed the person's permit to lapse or has had
6-63 the permit revoked under this Act and has not made adequate
6-64 provision for the administration of all funds deposited with the
6-65 person for prepaid funeral benefits contracts in accordance with
6-66 the terms of the contracts and applicable law, including
6-67 regulations <The Department may cancel a permit or refuse to renew
6-68 a permit for failure to comply with any provision of this Act or
6-69 any valid rule or regulation which the Department has prescribed,
6-70 after reasonable notice to the permittee and after a hearing if the
7-1 permittee requests a hearing.>
7-2 <No organization shall be entitled to a new permit for a
7-3 period of one year after cancellation or refusal by the Department
7-4 to renew its permit, but shall thereafter be entitled to a new
7-5 permit upon satisfactory proof of compliance with this law>.
7-6 Sec. 4A. TRANSFER OF BUSINESS OWNERSHIP. (a) A permit
7-7 issued under this Act is not transferable.
7-8 (b) If a permit holder transfers the ownership of its
7-9 business, the permit holder shall notify the Department and the
7-10 depository of the funds held under Section 5 of this Act by
7-11 registered mail within seven days after the date the transfer is
7-12 consummated. If the transfer is to a person who is not a permit
7-13 holder, the person shall file, within 30 days after the date of the
7-14 consummation of the transfer, an application for a permit with the
7-15 Department in accordance with Section 3 of this Act. If the
7-16 application is not filed within that period, or if the person does
7-17 not meet the requirements for issuance of a permit under this Act,
7-18 the Commissioner shall follow the procedures set forth in Section 4
7-19 of this Act for denying the permit application and for seizing the
7-20 funds or records.
7-21 (c) Any person aggrieved by the final action of the
7-22 Department may appeal therefrom to a District Court in Travis
7-23 County, Texas.
7-24 Sec. 5. TRUST FUNDED PREPAID FUNERAL BENEFITS. (a) All
7-25 sums heretofore or hereafter paid or collected on contracts for
7-26 prepaid funeral benefits entered into prior to the effective date
7-27 of this Act shall be handled in accordance with the manner in which
7-28 they have heretofore been handled. All sums paid or collected on
7-29 such contracts entered into after the effective date of this Act
7-30 (with the exception of those paid where a contract of insurance
7-31 previously is created or approved by the Department) shall be
7-32 handled in the following manner:
7-33 (1) The seller of a trust-funded prepaid funeral
7-34 benefits contract <funeral home (or other entity collecting said
7-35 funds)> may retain as its own money, for the purpose of covering
7-36 its selling expenses, servicing costs, and general overhead, an
7-37 amount not to exceed one-half of all funds so collected or paid
7-38 until it has received for its use and benefit an amount not to
7-39 exceed ten percent of the total amount agreed to be paid by the
7-40 purchaser of said prepaid funeral benefits as such total amount is
7-41 reflected in the contract. <No charges or assessments, except
7-42 premiums collected on an insurance policy guaranteeing the payments
7-43 on a prepaid funeral contract or the unpaid balance thereof, shall
7-44 be collected from the purchaser other than those included in the
7-45 total amount of said contract.>
7-46 (2) All amounts paid or collected, with the exception
7-47 of those permitted to be retained as set forth above, shall, within
7-48 30 <thirty> days after such collection, be (a) deposited in a
7-49 savings and loan association in this state in an interest-bearing
7-50 account insured by the federal government, or (b) deposited in a
7-51 state or national bank in this state in an interest-bearing account
7-52 insured by the federal government, or (c) placed with the trust
7-53 department in a state or national bank in this state, or in a trust
7-54 company authorized to do business in this state, to be invested by
7-55 such trust department or company in accordance with the terms and
7-56 provisions of this Act <the Texas Trust Code (Subtitle B, Title 9,
7-57 Property Code)>. Such deposits or trust accounts shall be carried
7-58 in the name of the funeral provider <home> or other entity to whom
7-59 the purchaser makes payment, but accounting records shall be
7-60 maintained by the seller showing the amount deposited or invested
7-61 with respect to any particular purchaser's contract.
7-62 (3) On the death of a beneficiary named in a prepaid
7-63 funeral benefits contract, the seller, after completion of the
7-64 funeral service and presentation to the depository of proper
7-65 affidavits signed and sworn to by an officer or authorized agent of
7-66 the seller on forms prescribed by the Department and a certified
7-67 copy of the death certificate, may withdraw the amount equal to the
7-68 original contract amount paid in by the purchaser less amounts
7-69 retained under Subsection (a)(1) of this section, plus all earnings
7-70 attributable to that contract. The seller shall maintain the
8-1 copies of the affidavits and death certificate for examination by
8-2 the Department. <The date of death of the purchaser of such
8-3 contract (or other individual who may be designated in the contract
8-4 as the person for whose funeral such funds may be used) shall be
8-5 the maturity date of the contract, and as soon as conveniently
8-6 practicable after such maturity date and upon presentation of a
8-7 certified copy of the death certificate of such person together
8-8 with proper affidavits as may be required by the Department, such
8-9 funds shall be released in fulfillment of the contract, and the
8-10 funeral home (or other entity to the contract which has collected
8-11 the funds) shall, if the amount so withdrawn does not equal one
8-12 hundred percent of the total amount paid by the purchaser, make up
8-13 the difference so that the amount available for funeral benefits
8-14 shall equal one hundred percent of the total amount paid by the
8-15 purchaser. Any amounts accumulated at maturity on any particular
8-16 contract in excess of one hundred percent of the amount deposited
8-17 or placed by the seller shall be available to the funeral home (or
8-18 other entity collecting said funds) in making up the difference on
8-19 any particular contract which at maturity did not have funds
8-20 available equal to one hundred percent of the amount paid by the
8-21 purchaser.>
8-22 (4)(A) The seller may withdraw <at any time> funds out
8-23 of earnings <accrued interest or income> on the accounts for the
8-24 purpose of paying reasonable and necessary trustee's fees or
8-25 depository fees. With prior approval of the Department, the seller
8-26 may withdraw funds out of earnings on the accounts <charges made by
8-27 a savings and loan association, or bank, or trust department of a
8-28 bank, or trust company, and trustee's fees made by a savings and
8-29 loan association, or bank, or trust department of a bank, or trust
8-30 company, with respect to such accounts,> for the purpose of paying
8-31 any taxes<, with prior approval of the Department,> caused or
8-32 created by reason of the existence of such deposit accounts or
8-33 trust accounts or for the purpose of paying an assessment under
8-34 Section 8A of this Act<, or for the purpose of paying any
8-35 assessment under this Act or ordered by the Department for funding
8-36 a fund to guarantee performance of prepaid funeral contracts>.
8-37 (B) The seller may also withdraw funds from the
8-38 earnings <accrued interest or income> on the <deposit> accounts for
8-39 the purpose of paying the examination fee for one examination by
8-40 the Department each calendar year, or for the preparation of
8-41 financial statements required by the Department, including
8-42 financial statements required in lieu of an examination by the
8-43 Department.
8-44 (C) Upon the maturity date of a trust-funded
8-45 contract as above provided and only after the funeral provider
8-46 <home> has fully performed its obligations under said contract with
8-47 the purchaser, or at the time of cancellation prior to maturity as
8-48 provided in Subsection (b)<5> herein, the seller may <additionally>
8-49 withdraw from said <deposit> account all earnings attributable to
8-50 <(whether a trust or other funded account) any enhanced value,
8-51 accrued interest, or accrued income on> said contract. Such
8-52 withdrawal shall be the proportionate part of the earnings <total
8-53 enhanced value, accrued interest or accrued income,> that the
8-54 amount deposited under said contract bears to the total amount
8-55 deposited from all unmatured contracts, less any withdrawals of
8-56 excess earnings made in accordance with this section, or, if the
8-57 Commissioner has affirmatively determined that the records of the
8-58 permit holder are adequate to allow this method to be exercised in
8-59 an accurate manner, the withdrawals may be equal to the actual
8-60 earnings on individual matured contracts, minus any properly
8-61 allocated expenses permitted by this <sub>section, less any
8-62 withdrawals of excess earnings made in accordance with this
8-63 section.
8-64 (D) On approval by the Commissioner, a
8-65 <application, the Commissioner may, after notice and hearing
8-66 conducted pursuant to the Administrative Procedure and Texas
8-67 Register Act (Article 6252-13a, Vernon's Texas Civil Statutes),
8-68 authorize the> seller of prepaid funeral benefits <preneed services
8-69 to> may withdraw excess earnings from the seller's trust accounts
8-70 <deposits>. For the purposes of this section, "excess earnings"
9-1 means funds in the trust accounts <deposits>, including all
9-2 realized and unrealized gains and losses, that exceed 110 <107>
9-3 percent of all sums paid by purchasers on the contracts. <of the
9-4 seller's obligations on each contract for which deposits have been
9-5 made after the date the contracts are entered into. The
9-6 Commissioner may grant the authorization if in the Commissioner's
9-7 opinion, the evidence shows that the seller's ability to deliver
9-8 the contracted services and merchandise is not diminished by the
9-9 withdrawal. The Commissioner by rule may set out factors that may
9-10 be considered in evaluating each application. The Commissioner's
9-11 decision on whether to grant the withdrawal is not limited to those
9-12 factors. A withdrawal of excess earnings made after an initial
9-13 withdrawal as provided by this subsection may not be approved for
9-14 more than 93 percent of the funds remaining in the accounts after
9-15 the withdrawal that are in excess of the 107 percent to be
9-16 maintained in satisfaction of the seller's contractual
9-17 obligations.>
9-18 (i) A seller must apply to the
9-19 Commissioner for approval to withdraw excess earnings from the
9-20 seller's trust accounts under this subsection. An application must
9-21 be in writing and must include a sworn statement by an agent of the
9-22 seller designated under Section 6 of this Act that:
9-23 (I) specifies the amount
9-24 eligible for withdrawal based on the market value of the trust
9-25 assets as of a date not more than 45 days prior to the date of the
9-26 application; and
9-27 (II) affirms that the
9-28 requested withdrawal constitutes excess earnings.
9-29 (ii) An application by a seller to
9-30 withdraw excess earnings from the seller's trust accounts must be
9-31 accompanied by:
9-32 (I) a statement from the
9-33 trustee of the trust accounts verifying the market and book values
9-34 of the assets in the accounts as of a date not more than 45 days
9-35 prior to the date of the application;
9-36 (II) the seller's most
9-37 recent audited or unaudited financial statements dated not more
9-38 than 18 months prior to the date the application is filed with the
9-39 Commissioner. In the event of the filing of a consolidated
9-40 application on behalf of affiliated sellers, audited financial
9-41 statements of the parent company may be submitted in lieu of those
9-42 of the sellers. Such audited statements shall be accompanied by an
9-43 unqualified opinion by a certified public accountant. In the event
9-44 the seller provides unaudited financial statements or audited
9-45 financial statements with a qualified opinion pursuant to this
9-46 subsection, the Commissioner may approve the application if the
9-47 application is accompanied by a surety bond from a company
9-48 acceptable to the Commissioner, in favor of the Commissioner, in an
9-49 amount equal to the amount of the requested withdrawal. Such bond
9-50 shall be reduced on an annual basis by an amount equal to 10
9-51 percent per year;
9-52 (III) the seller's
9-53 quarterly audited or unaudited profit and loss statements covering
9-54 the two years immediately preceding the year covered by the
9-55 financial statements required in Subsection (a)(4)(D)(ii)(II) of
9-56 this section. If the seller has not been in operation for three
9-57 (3) years, the profit and loss statements shall cover the period of
9-58 time that the seller has been operating;
9-59 (IV) financial records or
9-60 reports reflecting the total amount of the seller's contracts and
9-61 the total amount of payments made by purchasers with respect to the
9-62 seller's contracts; and
9-63 (V) In the event an
9-64 application is submitted by a seller that is not the funeral home
9-65 designated in the contracts that is obligated to provide the
9-66 specified prepaid funeral benefits, in addition to all information
9-67 required under Subsections (a)(4)(D)(ii)(I) through (IV) of this
9-68 section, such application shall be accompanied by:
9-69 (-a-) copies
9-70 of agreements with all funeral homes that willdeliver the funeral
10-1 services and merchandise, including amounts agreed to be paid to
10-2 such funeral homes by the seller; and
10-3 (-b-) an
10-4 affidavit from each funeral home stating that the withdrawal of
10-5 excess earnings in the amount requested will not affect its
10-6 contractual obligation to deliver the contracted funeral services
10-7 and merchandise.
10-8 (iii) The Commissioner shall approve a
10-9 completed application to withdraw excess earnings unless the
10-10 Commissioner determines that the seller's ability to deliver the
10-11 contracted services and merchandise would be materially jeopardized
10-12 by the withdrawal due to:
10-13 (I) the seller's failure,
10-14 after written notice from the Commissioner, to substantially comply
10-15 with any law or rule applicable to the sale of prepaid funeral
10-16 benefits in this state;
10-17 (II) the seller's willful
10-18 commission of any felony or fraudulent act in the conduct of the
10-19 seller's prepaid funeral business that threatens the seller's
10-20 solvency;
10-21 (III) the seller's refusal
10-22 to submit to an examination of the seller's trust accounts under
10-23 Section 8 of this Act;
10-24 (IV) the cancellation or
10-25 involuntary non-renewal of the seller's permit to sell prepaid
10-26 funeral benefits;
10-27 (V) the seller's knowing
10-28 withdrawal from the trust accounts of amounts that are not
10-29 authorized under this Act or the seller's refusal to correct the
10-30 unauthorized withdrawal after the receipt of written notice from
10-31 the Commissioner;
10-32 (VI) the seller's failure
10-33 to deposit or remit funds in accordance with this section or the
10-34 seller's refusal to make the required deposit or remittance after
10-35 the receipt of written notice from the Commissioner;
10-36 (VII) the amount of the
10-37 requested withdrawal exceeding the net worth of the seller, or if
10-38 the seller is an affiliate of a consolidated entity, the net worth
10-39 of the parent corporation. In the event the requested withdrawal
10-40 exceeds the net worth of the seller or, if applicable, the parent
10-41 corporation, the Commissioner may approve the withdrawal if the
10-42 seller provides a surety bond from a company acceptable to the
10-43 Commissioner, in favor of the Commissioner, in the amount of the
10-44 withdrawal in excess of the net worth of the seller or its parent.
10-45 Such bond shall be reduced on an annual basis by an amount equal to
10-46 20 percent per year;
10-47 (VIII) the seller (or the
10-48 parent, if a consolidated application is filed) having experienced
10-49 a net loss from operations in any of the last three years. In the
10-50 event of such a loss, the Commissioner may approve the withdrawal
10-51 if the seller provides a surety bond from a company acceptable to
10-52 the Commissioner, in favor of the Commissioner, in an amount equal
10-53 to the requested withdrawal. Such bond shall be reduced on an
10-54 annual basis by an amount equal to 10 percent per year;
10-55 (IX) the contingent
10-56 liabilities other than commitments disclosed on the face of
10-57 seller's (or parent's if a consolidated application is filed)
10-58 audited consolidated or unconsolidated balance sheet exceeding
10-59 seller's (or parent's if a consolidated application is filed) net
10-60 worth as of the date of the financial statement. In such event,
10-61 the Commissioner may approve the withdrawal if the seller provides
10-62 a surety bond from a company acceptable to the Commissioner, in
10-63 favor of the Commissioner, in an amount equal to the requested
10-64 withdrawal. Such bond shall be reduced on an annual basis by an
10-65 amount equal to 10 percent per year; or
10-66 (X) the withdrawal causing
10-67 the investments in the trust accounts to be in violation of Section
10-68 5A(d) of this Act.
10-69 (iv) In connection with the Commissioner's
10-70 review of a seller's application to withdraw excess earnings from
11-1 the trust accounts under this subsection, the Commissioner may
11-2 conduct an examination or audit of the seller's prepaid funeral
11-3 benefits records under Section 8 of this Act.
11-4 (v) The Commissioner shall issue a written
11-5 notice within 10 days of receipt of an application informing the
11-6 seller either that the application is complete and accepted for
11-7 filing, or that the application is deficient and that specific
11-8 additional information is required within 30 days. If the
11-9 requested information is not received within 30 days, the
11-10 application is deemed denied unless good cause exists for failure
11-11 to provide the information timely. The Commissioner shall approve
11-12 or deny an application under this subsection within 90 days of the
11-13 date of filing of a completed application. If a completed
11-14 application to withdraw excess earnings under this subsection is
11-15 not denied by the Commissioner within 90 days after it is accepted
11-16 by the Commissioner as complete, the application shall be deemed
11-17 approved by the Commissioner and the requested withdrawal shall be
11-18 deemed authorized without further action by the Commissioner. The
11-19 Commissioner may extend this time period for an additional 90 days
11-20 for good cause and upon notice to the seller. If the Commissioner
11-21 denies the application for withdrawal, the seller will be entitled
11-22 to a hearing conducted pursuant to the Administrative Procedure and
11-23 Texas Register Act, Texas Civil Statutes, Article 6252-13a.
11-24 Judicial review of a final decision by the Commissioner shall be by
11-25 trial de novo in a district court of Travis County.
11-26 (vi) Within 60 days following the approval
11-27 of an application under this subsection, the seller shall provide
11-28 the Commissioner with a verified statement indicating that the
11-29 withdrawn funds were used in the ordinary course of the seller's
11-30 business.
11-31 (vii) In the event a material error in an
11-32 application is discovered or the seller fails or refuses to comply
11-33 with or fulfill any undertaking assumed by the seller in connection
11-34 with the withdrawal of excess earnings from the seller's trust
11-35 accounts, the seller, after notice from the Commissioner and a
11-36 hearing, must return the disputed funds to the trust accounts or
11-37 the seller's permit will be subject to cancellation.
11-38 (viii) To the extent that additional
11-39 federal income taxes or other taxes are due as a result of a
11-40 withdrawal of excess earnings from a seller's trust accounts, such
11-41 taxes shall be paid by the seller and shall not be withdrawn from
11-42 the trust accounts.
11-43 (ix) Applications for withdrawal of excess
11-44 earnings under this subsection shall be filed with the Department
11-45 on forms acceptable to the Commissioner. Each application shall be
11-46 accompanied by a nonrefundable fee of $1,000 per permit, or a fee
11-47 not to exceed $5,000 for consolidated applications, made payable to
11-48 the Department, in order to cover the costs of processing the
11-49 application.
11-50 (x) This Subsection (D) shall be repealed
11-51 on December 31, 1993. Such repeal shall not affect those
11-52 applications to withdraw excess earnings filed prior to December
11-53 31, 1993, or that may be supplemented after December 31, 1993, all
11-54 of which applications shall be handled in accordance with the
11-55 provisions of this Subsection (D).
11-56 (b)(1) <(5)> In the event a purchaser under a trust-funded
11-57 contract should desire to cancel the contract prior to maturity,
11-58 such cancellation may be accomplished by the purchaser <seller>
11-59 giving to the seller written <fifteen days> notice of cancellation
11-60 on forms prescribed by the Department <in writing to the
11-61 Department, signed by the purchaser>, and thereafter, the <upon
11-62 written authorization from the Department, such> seller within 30
11-63 days after the date of the cancellation notice shall <may> withdraw
11-64 and pay to the purchaser the funds in such depository being held
11-65 for the purchaser's use and benefit; provided, however, such
11-66 purchaser shall be entitled to receive only the actual amounts paid
11-67 in by him less the amounts permitted to be retained as provided in
11-68 Subsection (a)(1) hereof. The seller shall maintain copies of the
11-69 cancellation forms for examination by the Department. Purchaser or
11-70 seller may make no partial cancellations or withdrawals.
12-1 (2) <(6)> A purchaser of a trust-funded contract who
12-2 elects to cancel the contract during the first year of the contract
12-3 when payments required under the contract are current is entitled
12-4 to receive 90 percent of the actual amounts paid in by the
12-5 purchaser or the amounts deposited in trust with respect to the
12-6 purchaser's contract, whichever is greater, regardless of the
12-7 amount held in trust. A purchaser of an insurance-funded contract
12-8 who elects to cancel the contract during the first year of the
12-9 contract when payments required under the contract are current is
12-10 entitled to receive the cash surrender value of the policy.
12-11 (3) If the purchaser cancels the contract on the
12-12 solicitation of the seller, the purchaser is entitled to withdraw
12-13 all funds paid to the seller and all earnings <enhanced value>
12-14 attributable to the funds. If the funds are used to purchase a new
12-15 prepaid <preneed> funeral contract pursuant to a solicitation by
12-16 the seller, the new contract must, as determined by the Department,
12-17 protect the purchaser to an extent equal to or greater than that
12-18 provided by the original contract, and the purchaser's cost of the
12-19 same or substantially the same services and merchandise may not be
12-20 increased above that contained in the canceled contract.
12-21 (4) The purchaser of a prepaid funeral benefits
12-22 contract may irrevocably waive and renounce the purchaser's right
12-23 to cancel the contract under Subsection (b) of this section. The
12-24 waiver and renunciation may be included as a provision of the
12-25 contract or be made in a separate writing signed by the purchaser
12-26 and the seller. The waiver and renunciation of a purchaser's right
12-27 to cancel the purchaser's prepaid funeral benefits contract do not
12-28 affect:
12-29 (A) a right the purchaser has under the contract
12-30 to change the beneficiary of the contract;
12-31 (B) the purchaser's right to cancel the contract
12-32 under Section 4(g) of this Act upon any seizure of the seller's
12-33 prepaid funeral funds by the Commissioner; or
12-34 (C) any abandonment of the funds paid by the
12-35 purchaser under the contract in accordance with Section 5B of this
12-36 Act.
12-37 (c) Notwithstanding any other provision of law, the
12-38 purchaser of an insurance-funded prepaid funeral benefits contract
12-39 may irrevocably assign the purchaser's ownership of and rights to
12-40 benefits under the insurance policy or annuity contract to the
12-41 seller, the funeral provider, the trustee or other person.
12-42 (d) A seller may enter into a written agreement with a
12-43 purchaser of a prepaid funeral benefits contract providing for the
12-44 payment of a finance charge in accordance with Chapter 6, Title 79,
12-45 Revised Statutes (Article 5069-6.01 et seq., Vernon's Texas Civil
12-46 Statutes), on any amount due and owing to the seller on the prepaid
12-47 funeral benefits contract.
12-48 Sec. 5A. INVESTMENT OF TRUST FUNDS. (a) A permit holder or
12-49 trustee, if the permit holder elects to deposit prepaid funeral
12-50 funds with a bank trust department or a trust company shall:
12-51 (1) adopt a written investment plan consistent with
12-52 this section that specifies the quality, maturity, and
12-53 diversification of investments; and
12-54 (2) at least annually, review the adequacy and the
12-55 implementation of the investment plan.
12-56 (b) A permit holder and the trustee, if any, shall maintain
12-57 the investment plan in their principal offices. The permit holder
12-58 shall provide the investment plan to the Department with the filing
12-59 of the permit holder's annual report. The permit holder or
12-60 trustee, if any, shall maintain investment records covering each
12-61 transaction.
12-62 (c) A trustee, in acquiring, investing, reinvesting,
12-63 exchanging, retaining, selling, supervising, and managing property
12-64 held in a prepaid funeral benefits trust shall exercise the
12-65 judgment and care under the circumstances then prevailing that
12-66 persons of ordinary prudence, discretion, and intelligence exercise
12-67 in the management of their own affairs, not in regard to
12-68 speculation but in regard to the permanent disposition of their
12-69 funds, considering the probable income from as well as the probable
12-70 increase in value and the safety of their capital, taking into
13-1 consideration the investment of all the assets of the trust over
13-2 which the trustee has management and control, rather than a
13-3 consideration as to the prudence of a single investment of the
13-4 trust.
13-5 (d) Within the limitations of the standard set out in
13-6 Subsection (c) of this section, investments of a prepaid funeral
13-7 benefits trust are limited to the following:
13-8 (1) demand deposits, savings accounts, certificates of
13-9 deposit, and all other accounts that are issued by banks and
13-10 savings and loan associations organized under the laws of the
13-11 United States or a state, provided that the amounts deposited in
13-12 such an account shall at all times be maintained so as to be fully
13-13 covered by federal deposit insurance;
13-14 (2) bonds, evidences of indebtedness, or obligations
13-15 of the United States, or guaranteed as to principal and interest by
13-16 the full faith and credit of the United States;
13-17 (3) bonds, evidences of indebtedness, or obligations
13-18 of agencies and instrumentalities of the government of the United
13-19 States;
13-20 (4) bonds of any state or local government that have
13-21 been given federal income tax exempt status by the United States
13-22 government and that are rated:
13-23 (A) "Aa" or better by Moody's bond rating
13-24 service; or
13-25 (B) "AA" or better by Standard and Poor's bond
13-26 rating service;
13-27 (5) bonds, evidences of indebtedness, or obligations
13-28 of corporations organized under the laws of the United States or a
13-29 state, provided that the bonds, evidences of indebtedness, or
13-30 obligations are rated:
13-31 (A) "A" or better by Moody's bond rating
13-32 service; or
13-33 (B) "A" or better by Standard and Poor's bond
13-34 rating service;
13-35 (6) notes, evidences of indebtedness, or participation
13-36 in notes or evidences of indebtedness, secured by a valid first
13-37 lien on real property located in the United States, the amount of
13-38 which obligations may not exceed 90 percent of the value of the
13-39 respective parcels of real property securing them;
13-40 (7) common stock of a corporation organized under the
13-41 laws of the United States or a state, provided that the corporation
13-42 has at least $1 million of net worth or will have at least $1
13-43 million of net worth after completion of a securities offering to
13-44 which the trust is subscribing;
13-45 (8) preferred stock of a corporation organized under
13-46 the laws of the United States or a state, provided that the stock
13-47 is rated;
13-48 (A) "BAA" or better by Moody's bond rating
13-49 service; or
13-50 (B) "BBB" or better by Standard and Poor's bond
13-51 rating service;
13-52 (9) real estate, oil and gas interests, limited
13-53 partnerships, and any other investments not covered by this
13-54 section;
13-55 (10) mutual funds, collective investment funds, or
13-56 similar participative investment funds, the assets of which are
13-57 invested solely in investments permitted under this section and
13-58 that, if aggregated with other investments, meet the percentage
13-59 limitations specified by this section; and
13-60 (11) any other investment approved in writing by the
13-61 Department.
13-62 (e) At no time may more than 70 percent of the prepaid
13-63 funeral benefits trust funds related to a single permit holder be
13-64 invested in:
13-65 (1) bonds, evidences of indebtedness, obligations,
13-66 notes, and participation described by Subsection (d)(5) or (6) of
13-67 this section; or
13-68 (2) common or preferred stock described by Subsection
13-69 (d)(7) or (8) of this section.
13-70 (f) At no time may more than 10 percent of the prepaid
14-1 funeral benefits trust funds related to a single permit holder be
14-2 invested in real estate, oil and gas interests, limited
14-3 partnerships, and other investments described by Subsection (d)(9)
14-4 of this section.
14-5 (g) At no time may more than 20 percent of the prepaid
14-6 funeral benefits trust funds related to a single permit holder be
14-7 invested in a single issue of any investment, with the exception of
14-8 insured deposits and government securities.
14-9 (h) This section applies to investments that are made on or
14-10 after the effective date of this Act. Before September 1, 1996, a
14-11 permit holder or trustee shall dispose of all investments made
14-12 before the effective date of this Act that are not in compliance
14-13 with this section in respect to the type of investment or the
14-14 percentage of trust funds that may be invested in certain types of
14-15 investments. The Commissioner may grant an extension of time for a
14-16 period of one year or more for disposing of a nonconforming
14-17 investment if, in the Commissioner's opinion, the permit holder or
14-18 trustee has made a good faith effort to dispose of the
14-19 nonconforming investment or the disposal of the nonconforming
14-20 investment would be materially detrimental to the best interests of
14-21 the purchasers of prepaid funeral benefit contracts.
14-22 Sec. 5B. ABANDONED CONTRACTS. (a) Funds paid by a
14-23 purchaser of a prepaid funeral benefits contract are personal
14-24 property subject to presumption of abandonment and delivery to the
14-25 state treasurer <escheat> under Title 6, Property Code. In the
14-26 event of a conflict between the provisions of that title and this
14-27 section, this section controls.
14-28 (b) Funds paid by a purchaser of a prepaid funeral benefits
14-29 contract and held in the name of the seller at a depository
14-30 <institution> under Section 5 of this Act are presumed abandoned if
14-31 <a claim of ownership to the funds or the contract is not asserted
14-32 and>:
14-33 (1) all amounts due to the seller from the purchaser
14-34 under the terms of the contract have been collected and <the
14-35 conditions under both Paragraphs (A) and (B) of this subsection
14-36 have occurred>:
14-37 (A) at least three consecutive years have
14-38 elapsed since the existence and location of the purchaser or the
14-39 beneficiary of the contract was known to the seller;
14-40 (B) at least three consecutive years have
14-41 elapsed since, according to the knowledge and records of the
14-42 seller, a claim to or act of ownership of the funds or the contract
14-43 has been asserted or exercised;
14-44 (C) at least 60 years have elapsed since the
14-45 date of execution by the purchaser of the contract; and
14-46 (D) <(B)> at least 90 years have elapsed since
14-47 the date of birth of the beneficiary of <individual designated in>
14-48 the contract <as the person for whose funeral the funds may be
14-49 used>; or
14-50 (2) all amounts due to the seller from the purchaser
14-51 under the terms of the contract have not been paid to the seller
14-52 and<,> at least three consecutive years have elapsed since:
14-53 (A) the most recent date on which the purchaser
14-54 made a payment to the seller under the contract;
14-55 (B) the existence and location of the purchaser
14-56 or the beneficiary of the contract was known to the seller; and
14-57 (C) according to the knowledge and records of
14-58 the seller, a claim to or act of ownership of the funds or the
14-59 contract has been asserted or exercised<, and under the terms of
14-60 the contract the seller is not obligated to refund the amount
14-61 received>.
14-62 (c) For purposes of Title 6, Property Code, the seller of
14-63 the prepaid funeral benefits contract for which funds are presumed
14-64 abandoned under Subsection (b) of this section is the holder of the
14-65 funds, and the purchaser or the beneficiary of the contract is the
14-66 owner of the <principal> funds <paid on the contract>.
14-67 (d) Any amount retained by the seller as its own money for
14-68 the purpose of covering its selling expenses, servicing costs, and
14-69 general overhead, as provided by Section 5(a)(1) of this Act, and
14-70 any earnings attributable to the funds paid by a purchaser of a
15-1 prepaid funeral benefits contract, are not subject to the
15-2 presumption of abandonment as provided by Subsection (b) of this
15-3 section.
15-4 (e)(1) Each seller that on June 30 holds funds that are
15-5 presumed abandoned under Subsection (b) of this section shall
15-6 furnish the Commissioner with an acknowledged written notice of the
15-7 abandoned funds not later than the following October 1. The
15-8 seller's notice shall, for each abandoned contract, include the
15-9 name and address, if known, of each person who appears to be the
15-10 purchaser or the beneficiary of the contract; the identification
15-11 number, if any, of the contract; the total amount paid on the
15-12 contract; the amount paid on the contract and held at the
15-13 depository; and the earnings of the contract. The notice shall
15-14 also contain a statement by the seller recognizing the seller's
15-15 obligation and intent to deliver the abandoned funds to the state
15-16 treasurer in accordance with this section.
15-17 (2) The Commissioner shall, within 15 days after the
15-18 date of the receipt of the seller's notice, authorize in writing
15-19 the seller to withdraw the funds specified in the seller's notice
15-20 that are presumed abandoned under Subsection (b) of this section,
15-21 and subject to Subdivision (3) of this subsection, to withdraw and
15-22 retain the funds specified in the seller's notice that represent
15-23 the earnings attributable to the abandoned funds. The seller shall
15-24 deliver to the state treasurer not later than the following
15-25 November 1 the abandoned funds and the report required to be filed
15-26 under Chapter 74, Property Code.
15-27 (3) The Commissioner may refuse to authorize the
15-28 withdrawal of the funds representing the earnings attributable to
15-29 the abandoned funds only if:
15-30 (A) the seller's permit to sell prepaid funeral
15-31 benefits has been cancelled or not renewed by the Department;
15-32 (B) the seller is the subject of a pending
15-33 proceeding brought by the Department under Section 13,
15-34 Administrative Procedure and Texas Register Act (Article 6252-13a,
15-35 Vernon's Texas Civil Statutes), and its subsequent amendments, to
15-36 cancel the seller's permit to sell prepaid funeral benefits; or
15-37 (C) the Department has determined from an
15-38 examination of the seller's records that the seller has made
15-39 withdrawals from accounts maintained by the seller that were not
15-40 authorized under this Act, and has previously given written notice
15-41 to the seller of that determination.
15-42 (4) If the Commissioner does not authorize the seller
15-43 to withdraw the funds representing the earnings attributable to the
15-44 abandoned funds because of the existence of a condition described
15-45 by Subdivision (3) of this subsection, the Commissioner shall, not
15-46 later than the 15th day after the date of the receipt of the
15-47 seller's notice to the Commissioner under Subdivision (1) of this
15-48 subsection, give written notice to the seller that states the
15-49 condition that exists. If the Commissioner notifies the seller
15-50 that the Commissioner does not authorize the seller's withdrawal of
15-51 earnings on the basis of Subdivision (3)(B) of this subsection and
15-52 if the Department or a court of competent jurisdiction subsequently
15-53 determines that the seller's permit should not be cancelled, the
15-54 seller is entitled to withdraw and retain all of the earnings
15-55 attributable to the abandoned funds. If the Commissioner notifies
15-56 the seller that the Commissioner does not authorize the seller's
15-57 withdrawal of earnings on the basis of Subdivision (3)(C) of this
15-58 subsection, the seller, upon depositing in the accounts the amount
15-59 of the unauthorized withdrawals, is entitled to withdraw and retain
15-60 all of the earnings attributable to the abandoned funds.
15-61 (f) <(d)> A seller <of a prepaid funeral services contract>
15-62 who <in good faith> reports and delivers funds to the State
15-63 Treasurer under this section <Chapter 74, Property Code,> is
15-64 relieved of all obligations and liabilities under the prepaid
15-65 funeral benefits <services> contract. The prepaid funeral benefits
15-66 contract is considered to be cancelled by the purchaser of the
15-67 contract and all obligations and liabilities of and claims against
15-68 the seller and any funeral home obligated to provide prepaid
15-69 funeral benefits under the contract are discharged and released.
15-70 (g) A seller who delivers funds to the state treasurer under
16-1 this section shall be indemnified under Section 74.304, Property
16-2 Code, for any claim that may be made with respect to the property
16-3 <if all amounts due to the seller under the terms of a contract
16-4 abandoned under this section have been paid, the seller shall
16-5 report and deliver to the state treasurer the principal amount paid
16-6 by the purchaser of such contract>.
16-7 (h) <(e)> The state treasurer is not liable to the purchaser
16-8 or beneficiary of a prepaid funeral benefits <services> contract
16-9 presumed abandoned under this section except to the extent of funds
16-10 attributable to the contract that are delivered to the state
16-11 treasurer. The state treasurer is not obligated to perform the
16-12 seller's duties under an abandoned prepaid funeral benefits
16-13 <services> contract. A purchaser's or beneficiary's sole recourse
16-14 after a seller has reported and delivered funds to the state
16-15 treasurer is to file a claim with the state treasurer as provided
16-16 by Chapter 74, Property Code.
16-17 Sec. 6. AGENT; DEPOSIT OF FUNDS. (a) Each seller
16-18 <organization> subject to this Act shall designate an agent or
16-19 agents, either by names of the individuals or by titles of their
16-20 offices or positions, who shall be considered as fiduciaries under
16-21 Section 32.45, Penal Code, and who are responsible for deposit of
16-22 funds collected under contracts for prepaid funeral benefits. The
16-23 seller <organization> shall notify the Department of such
16-24 designation within 10 days after it becomes subject to this Act,
16-25 and shall also notify the Department of any change in such
16-26 designation within 10 days before such change occurs.
16-27 (b) If the seller or any other person acting on behalf of
16-28 the seller collects any money under such a contract and fails to
16-29 deliver it, within 30 days after collection, to a designated agent,
16-30 or if any designated agent fails to deposit the money within 30
16-31 days after he receives it, he commits an offense under Section
16-32 32.45, Penal Code.
16-33 (c) It is an exception to the application of Subsection (b)
16-34 of this section that the failure to make a deposit is inadvertent
16-35 and is corrected within 10 days after the date on which the
16-36 discovery of the failure is made by the seller.
16-37 Sec. 7. ANNUAL REPORT. The Department may require an annual
16-38 report from any permit holder in such form as the Department may
16-39 require. Any seller who <organization which> has discontinued the
16-40 sale of prepaid funeral benefits but <which> still has outstanding
16-41 contracts shall <not> be required to obtain a renewal of its
16-42 permit, and <but> the Department shall <may> require annual reports
16-43 of said seller <organization> until all such contracts have been
16-44 fully discharged. If any officer of a seller <any organization>
16-45 fails or refuses to file an annual report or to cause it to be
16-46 filed within 30 days after he has been notified of the requirement
16-47 by the Department, he shall be guilty of a misdemeanor and a
16-48 violation of this Act and shall be punished by those means
16-49 prescribed in Section 9 of this Act.
16-50 Sec. 8. RECORDS; EXAMINATION. (a) Each seller who
16-51 <organization which> has outstanding contracts for prepaid funeral
16-52 benefits shall maintain within this state such records as the
16-53 Department may require to enable it to determine whether the seller
16-54 <organization> is complying with the provisions of this Act. Such
16-55 records shall be subject to annual examination by the Department or
16-56 its agent and to such additional examinations as it deems
16-57 necessary. The seller <organization> shall pay for the cost of
16-58 examination, including the salary and travel <traveling> expenses
16-59 for Department employees, including travel <paid to the person
16-60 making the examination during the time spent in making the
16-61 examination and in traveling> to and <returning> from the point
16-62 where the records are kept, and all other expenses necessarily
16-63 incurred in the examination. The <Banking> Commissioner or the
16-64 Commissioner's <his> agent shall assess and collect a fee in
16-65 connection with each examination, based on the seller's
16-66 <organization's> total outstanding contracts, covering the cost of
16-67 such examination, the equitable or proportionate cost of
16-68 maintenance and operation of the <Banking> Department, and the
16-69 enforcement of the provisions of this Act<, but the cost to the
16-70 organization shall not be more than a total cost of $3,000 for each
17-1 examination>. The Department shall set the amount of those fees
17-2 under Section 2 of this Act.
17-3 (b) <Following cancellation of a permit, the Commissioner
17-4 may seize all records of the prior permit holder and may seize all
17-5 prepaid funeral funds, including earnings, of the prior permit
17-6 holder, place them under the sole control of the Commissioner with
17-7 a state bank, the state treasury, a state-chartered trust company,
17-8 or an insurance company licensed and domiciled in this state and
17-9 approved by the Commissioner, and cause the funds to be maintained
17-10 under that arrangement for the benefit of the purchasers. The
17-11 Commissioner shall notify each purchaser of the Commissioner's
17-12 action and direct the purchaser to forward payments on contracts
17-13 directly to the depository designated by the Commissioner. The
17-14 Department may adopt reasonable rules for the enforcement and
17-15 orderly administration of this subsection.>
17-16 <(c) Those organizations with less than 50 contracts
17-17 outstanding shall be assessed an examination fee of $50 plus
17-18 one-fourth of one percent of the dollar amount of the
17-19 organization's outstanding contract funds on deposit, in trust, or
17-20 vested in any other program subject to this Act. Those
17-21 organizations with 50 or more contracts outstanding shall be
17-22 assessed an examination fee of $100 plus one-fourth of one percent
17-23 of the dollar amount of the organization's outstanding contract
17-24 funds on deposit, in trust, or vested in any other program subject
17-25 to this Act.>
17-26 <(d)> As part of the examination, the Department is entitled
17-27 to access to the records relating to prepaid funeral benefits of
17-28 any entity holding deposits or premiums for annuity contracts or
17-29 policies of insurance under the account and to other records
17-30 necessary to protect the interests of the beneficiaries. The
17-31 Department may conduct an examination or audit of records
17-32 pertaining to prepaid funeral benefits at any place and in any
17-33 manner the Department considers necessary to protect the interests
17-34 of the purchasers or beneficiaries.
17-35 (c) All information obtained, either directly or indirectly,
17-36 by the Department relative to the financial condition of any seller
17-37 whether obtained through examination or otherwise, except published
17-38 statements, and all files and records of the Department relative
17-39 thereto shall be confidential, provided that the Commissioner may,
17-40 if deemed necessary or proper to the enforcement of the laws of
17-41 this State, another state, or the United States, and in the best
17-42 interest of the public, divulge such information to any other
17-43 department of this State, another state, or the National
17-44 Government, or any agency or instrumentality thereof.
17-45 Sec. 8A. GUARANTY FUND; ASSESSMENT. (a) The Department by
17-46 rule shall create and maintain a fund to guarantee performance by
17-47 sellers of prepaid funeral benefits contracts of their obligations
17-48 to purchasers under the provisions of this Act governing prepaid
17-49 funeral trusts. The Department shall assess and collect from
17-50 sellers an assessment of not more than $1 for each of the unmatured
17-51 prepaid funeral benefits contracts sold during each calendar year
17-52 beginning with 1993 <existing on January 1, 1988. The Department
17-53 shall also assess and collect an assessment of not more than $1 for
17-54 each prepaid funeral contract sold during 1988 by a permittee first
17-55 receiving a permit in 1988>. The Department shall place the
17-56 assessments in the fund. The Department shall stop assessing the
17-57 amounts required by this subsection when the amount in the fund
17-58 first reaches $1 million.
17-59 (b) The fund may be deposited with the state treasurer, a
17-60 state or national bank in this state, or a savings and loan
17-61 association in this state, or placed with the trust department in a
17-62 state or national bank in this state or in a trust company
17-63 authorized to do business in this state. If the fund is deposited
17-64 with the state treasurer, the <The> state treasurer shall manage
17-65 the fund as trustee of funds outside the treasury. The Department
17-66 may use any earnings from the fund for the expenses of operating
17-67 and maintaining the fund. <An actuarial study shall be made before
17-68 April 1, 1988, to determine the total amount needed to maintain a
17-69 sound and responsible fund. The Department may make any additional
17-70 assessments on unmatured contracts to maintain the funds at the
18-1 amount found to be actuarially sound.>
18-2 (c) The operation and maintenance of the fund shall be
18-3 supervised by an advisory council composed of the Commissioner and
18-4 Attorney General or their representatives, <and> one representative
18-5 of the funeral industry appointed by the Finance Commission of
18-6 Texas, and one consumer representative appointed by the Finance
18-7 Commission of Texas <Banking Commissioner>. The funeral industry
18-8 representative and the consumer representative serve <serves a>
18-9 two-year terms <term> and may not serve more than two terms <one
18-10 term>. The Commissioner shall cast the deciding vote if there is a
18-11 tie vote by members of the advisory council.
18-12 (d) The advisory council may make assessments against all
18-13 permit holders, based upon their proportionate share of the
18-14 purchasers' deposits on all outstanding prepaid funeral benefits
18-15 contracts, in order to pay claims against the fund when the balance
18-16 of the fund is not sufficient to pay those claims. Assessed funds
18-17 shall be placed in the fund established under Subsection (a) of
18-18 this section and administered by the Department and the advisory
18-19 council in accordance with rules adopted by the Department. The
18-20 assessments under this subsection are in addition to those provided
18-21 for by Subsection (a) of this section.
18-22 (e) Notwithstanding any other law, the Department may assert
18-23 a claim against a seller or <trust> depository that commits a
18-24 violation of this Act that could result in a claim against the
18-25 fund.
18-26 Sec. 9. OFFENSES. (a) A permit holder may not represent
18-27 that a prepaid <preneed> funeral vendor is approved or otherwise
18-28 chosen by the Department except with the following language: "The
18-29 Texas Banking Department regulates the sale of prearranged funeral
18-30 contracts" and "The form of this contract has been approved by the
18-31 Department."
18-32 (b) Except as provided by Subsection (c) of this section,
18-33 any officer, director, agent, or employee of any seller
18-34 <organization> subject to the terms of this Act who makes or
18-35 attempts to make any contract in violation of this Act, or who
18-36 refuses to allow an inspection of the seller's <organization's>
18-37 records relating to the sale of prepaid funeral benefits, or who
18-38 violates any other provision of this Act, or who is guilty of
18-39 fraud, deception, misrepresentation or any other dishonest practice
18-40 in sale of any contract subject to this Act, shall be punished by a
18-41 fine of not less than $100 and not more than $500, or by
18-42 imprisonment in the county jail for not less than one month and not
18-43 more than six months, or by both such fine and imprisonment. Each
18-44 violation of any provision of this Act shall be deemed a separate
18-45 offense and prosecuted individually.
18-46 (c) Any failure to deposit funds in compliance with this
18-47 Act, or any withdrawal of funds in a manner inconsistent with the
18-48 provisions of this Act, is an offense under Section 32.45, Penal
18-49 Code.
18-50 (d) A depository or holder of funds designated under Section
18-51 5 of this Act shall be held to the standard of duty of a fiduciary
18-52 in holding, investing, and disbursing the funds.
18-53 (e) The Department may bring each such violation of this Act
18-54 to the attention of the Attorney General of this state and it shall
18-55 be the duty of the Attorney General to institute suit in the name
18-56 of the State of Texas against such violator in any county in this
18-57 state where such violation might occur.
18-58 (f) In addition to the penalties prescribed above, the
18-59 Attorney General shall have the power and authority to institute
18-60 quo warranto proceedings in a District Court of Travis County,
18-61 Texas to forfeit the charter and right to do business of a
18-62 corporation whose officer, director, agent or employee refuses or
18-63 fails to correct a violation of this Act after such violation has
18-64 been called to the attention of said officer, director, agent or
18-65 employee by the Department or the Attorney General. A period of 30
18-66 days shall be considered sufficient time to correct such violation
18-67 after notice from the Department or Attorney General.
18-68 Sec. 10. COLLECTION AND DISPOSITION OF MONEY. (a) Except
18-69 as provided by this section, all <All> fees, penalties, and
18-70 revenues collected by the Department <department> shall be paid to
19-1 the State Treasury, placed in the prepaid funeral account fund, and
19-2 shall be expended as authorized by legislative appropriation.
19-3 (b) The Department shall pay funds received under an order
19-4 of restitution to the injured party as ordered.
19-5 (c) Seized funds and premiums received on the disposition of
19-6 related contracts shall be handled as provided by Section 4(g) of
19-7 this Act.
19-8 Sec. 10A <10a>. APPLICABILITY TO INSURANCE CODE. Nothing in
19-9 this Act shall alter or affect any provisions of the Insurance Code
19-10 of the State of Texas; provided however, that purchasers of
19-11 contracts for prepaid funeral benefits from the same seller of such
19-12 contracts shall constitute a lawful group for the issuance of a
19-13 group contract of decreasing term life insurance by a life
19-14 insurance company authorized to do a life insurance business in the
19-15 State of Texas. The amount of insurance relative to any particular
19-16 purchaser shall at all times approximate the future unpaid balance
19-17 of such contract for prepaid funeral benefits. The seller of
19-18 prepaid funeral benefits <benefit> contracts shall have an
19-19 insurable interest in the life of any purchaser of such contract to
19-20 the extent of any unpaid balance thereof, and the proceeds of any
19-21 life insurance policy received by a seller of a prepaid funeral
19-22 benefits <benefit> contract on the life of a purchaser of such
19-23 contract shall be applied to the reduction or elimination of any
19-24 unpaid balance thereof. This section shall not be construed as
19-25 having any effect on the funding of prepaid funeral benefits by
19-26 other contracts of insurance as provided for in Section 1A <1a> of
19-27 this Act.
19-28 SECTION 2. Subsections (b) and (e), Article 6.01, Title 79,
19-29 Revised Statutes (Article 5069-6.01, Vernon's Texas Civil
19-30 Statutes), are amended to read as follows:
19-31 (b) "Services" means work, labor, or services of any kind
19-32 when purchased primarily for personal, family or household use and
19-33 not for commercial or business use, and includes a maintenance or
19-34 service contract or agreement or warranty, but does not include (i)
19-35 the services, other than prepaid funeral benefits regulated by
19-36 Article 548(b), Vernon's Texas Civil Statutes, of a professional
19-37 person licensed by the State except when those services are
19-38 rendered in connection with the purchase of goods; or (ii) services
19-39 for which the cost is by law fixed or approved by, or filed with or
19-40 subject to approval or disapproval by the United States or the
19-41 State of Texas, or any agency, instrumentality or subdivision
19-42 thereof; or (iii) educational services provided by an accredited
19-43 college or university or a primary or secondary school providing
19-44 education required by the State of Texas or services of a
19-45 kindergarten or nursery school; or (iv) any services which are
19-46 authorized to be and are included in a contract subject to Chapter
19-47 7 of this Subtitle; or (v) any medical or legal services.
19-48 (e) "Retail installment transaction" means any transaction
19-49 in which a retail buyer purchases goods or services from a retail
19-50 seller pursuant to a retail installment contract or retail charge
19-51 agreement, as defined in this Article, which provides for a time
19-52 price differential, as defined in this Article, and under which the
19-53 buyer agrees to pay the unpaid balance in one or more installments,
19-54 together with a time price differential. The term includes
19-55 transactions made pursuant to a retail credit card arrangement as
19-56 defined in this Article. The term also includes the sale of
19-57 prepaid funeral benefits regulated by Article 548(b), Vernon's
19-58 Texas Civil Statutes.
19-59 SECTION 3. Chapter 6, Title 79, Revised Statutes (Article
19-60 5069-6.01 et seq., Vernon's Texas Civil Statutes), is amended by
19-61 adding Article 6.12 to read as follows:
19-62 Art. 6.12. RATES FOR PREPAID FUNERAL BENEFITS REGULATED BY
19-63 ARTICLE 548(b), VERNON'S TEXAS CIVIL STATUTES. Prepaid funeral
19-64 benefits regulated by Article 548(b), Vernon's Texas Civil
19-65 Statutes, may be financed only at rates authorized by Article 1.04
19-66 of this title.
19-67 SECTION 4. (a) A fund, investment, security, or contract
19-68 included in a plan approved before the effective date of this Act,
19-69 by the Banking Department of Texas under Section 1a, Chapter 512,
19-70 Acts of the 54th Legislature, 1955 (Article 548b, Vernon's Texas
20-1 Civil Statutes), may continue in effect. Any funds paid pursuant
20-2 to such a plan under a contract entered into before, on, or after
20-3 the effective date of this Act shall continue to be handled in
20-4 accordance with that approved plan, except that those funds may be
20-5 invested in accordance with Section 5A, Chapter 512, Acts of the
20-6 54th Legislature, Regular Session, 1955 (Article 548b, Vernon's
20-7 Texas Civil Statutes), as amended by this Act.
20-8 (b) Sections 1(h) and (i), Chapter 512, Acts of the 54th
20-9 Legislature, Regular Session, 1955 (Article 548b, Vernon's Texas
20-10 Civil Statutes), as added by this Act, do not apply to a plan
20-11 approved before the effective date of this Act, by the Banking
20-12 Department of Texas under Section 1a, Chapter 512, Acts of the 54th
20-13 Legislature, Regular Session, 1955 (Article 548b, Vernon's Texas
20-14 Civil Statutes).
20-15 SECTION 5. This Act takes effect September 1, 1993.
20-16 SECTION 6. The importance of this legislation and the
20-17 crowded condition of the calendars in both houses create an
20-18 emergency and an imperative public necessity that the
20-19 constitutional rule requiring bills to be read on three several
20-20 days in each house be suspended, and this rule is hereby suspended.
20-21 * * * * *
20-22 Austin,
20-23 Texas
20-24 May 11, 1993
20-25 Hon. Bob Bullock
20-26 President of the Senate
20-27 Sir:
20-28 We, your Committee on Economic Development to which was referred
20-29 H.B. No. 2499, have had the same under consideration, and I am
20-30 instructed to report it back to the Senate with the recommendation
20-31 that it do not pass, but that the Committee Substitute adopted in
20-32 lieu thereof do pass and be printed.
20-33 Parker,
20-34 Chairman
20-35 * * * * *
20-36 WITNESSES
20-37 FOR AGAINST ON
20-38 ___________________________________________________________________
20-39 Name: Catherine A. Ghiglieri x
20-40 Representing: Texas Dept. of Banking
20-41 City: Austin
20-42 -------------------------------------------------------------------
20-43 FOR AGAINST ON
20-44 ___________________________________________________________________
20-45 Name: Philip R. Bishop x
20-46 Representing: Mt. Olivet Cemetery Assn.
20-47 City: Ft. Worth
20-48 -------------------------------------------------------------------
20-49 Name: Robert D. Gordon x
20-50 Representing: TX Cemeteries Assn.
20-51 City: Arlington
20-52 -------------------------------------------------------------------
20-53 Name: Jan Parker x
20-54 Representing: Equity Corp. Int'l.
20-55 City: Burnet
20-56 -------------------------------------------------------------------
20-57 Name: John Cathey x
20-58 Representing: TFDA
20-59 City: Austin
20-60 -------------------------------------------------------------------
20-61 Name: Brian Davis x
20-62 Representing: Directors Investment Group
20-63 City: Austin
20-64 -------------------------------------------------------------------
20-65 Name: Norman C. Brady x
20-66 Representing: Service Corp. International
20-67 City: Houston
20-68 -------------------------------------------------------------------
20-69 Name: Johnnie B. Rogers, Jr. x
20-70 Representing: N. American Death Care Allianc
21-1 City: Austin
21-2 -------------------------------------------------------------------
21-3 Name: D'Ann Johnson x
21-4 Representing: Texas Dept. of Banking
21-5 City: Austin
21-6 -------------------------------------------------------------------
21-7 Name: Gaylord Armstrong x
21-8 Representing: TX Funeral Directors Assn.
21-9 City: Austin
21-10 -------------------------------------------------------------------