SECTION 1. The legislature finds that the death care industry in the State has been vulnerable to lawsuits due to a lack of due care in dealing with funeral trust accounts and the improper handling of bodies and remains. Other states, including California, Georgia, and Tennessee, each have a single, industry-wide funeral board, which provides oversight of industry professionals and various aspects of the death care industry. The State lacks an industry-wide funeral board and does not require additional background checks for industry professionals that other states require, in an effort to protect consumers.

The purpose of this Act is to adopt measures to increase oversight and regulation of Hawaii's death care industry to protect consumers. This Acts requires the licensure of cemetery salespersons; requires background checks for funeral directors and embalmers to protect consumers; and establishes a task force to examine the death care industry's existing regulatory framework and make recommendations on the consolidation of oversight under a newly created death care industry board.

SECTION 2. Chapter 469, Hawaii Revised Statutes, is amended by adding two new sections to be appropriately designated and to read as follows:

"§469- Definitions. As used in this chapter, unless the context otherwise requires:

"Department" means the department of health.

"Embalmer" means a person who is licensed as an embalmer under the laws of the State; qualified to disinfect or preserve human remains by the injection or external application of antiseptics, disinfectants, or preservative fluids; qualified to prepare human bodies for transportation that are dead of contagious or infectious diseases; and qualified to use derma surgery or plastic art for restoring mutilated features.

"Funeral director" means a person in the practice of directing or supervising funerals, the practice of preparing dead human bodies for burial by any means, other than by embalming, or the disposition of dead human bodies; the making of arrangements to provide for funeral services, the selling of funeral services or merchandise, the making of financial arrangements for the rendering of the services or the sale of funeral merchandise, or any combination of these practices; or holding out to the public that one is a funeral director or engaged in one of the practices described herein.

§469- Background check. (a) The department, upon the written authorization of an applicant, shall conduct a background check of any embalmer or funeral director applicant or direct another responsible party to conduct the check.

(b) Before initiating or requesting a background check, the department shall first certify that the signature on the authorization form is authentic and that the person is an applicant for such employment.

(c) The background check shall require the applicant to disclose whether the applicant has been convicted in any jurisdiction of a crime, which would indicate that the applicant may be unsuited for employment as an embalmer or funeral director, and the judgment of conviction has not been vacated.

(d) For purposes of this section, the department may verify the applicant's criminal history disclosure from information obtained through the Hawaii criminal justice data center.

(e) The applicant shall provide the Hawaii criminal justice data center with personal identifying information, which shall include but not be limited to the applicant's name, date of birth, gender, and social security number. This information shall be used only for the purpose of conducting the criminal history record check authorized by this section.

(f) Failure of the department to conduct or verify a background check, or cause to have conducted or verified a background check, shall not alone give rise to any private cause of action against the department."

SECTION 3. Section 441-1, Hawaii Revised Statutes, is amended by adding a new definition to be appropriately inserted and to read as follows:

""Cemetery salesperson" means a person who sells or offers to sell, buys or offers to buy, lists, leases or offers to lease, or solicits or negotiates the purchase, sale, lease, or exchange of cemetery property or interment services."

SECTION 4. Section 441-25, Hawaii Revised Statutes, is amended to read as follows:

"§441-25 [~~License not required to act as cemetery or pre-need funeral salesperson.~~] Cemetary salesperson; license required. [~~Chapter 467, relating to real estate brokers and salespersons, shall not be applicable to cemetery salespersons.~~] Every cemetery salesperson shall:

(1) Be a licensed real estate salesperson in compliance with chapter 467 and the rules of the real estate commission;

(2) Pay a non-refundable application fee and, upon approval, an initial registration fee, and subsequently pay a reregistration fee, to practice as a cemetery salesperson, as prescribed by rules adopted by the director pursuant to chapter 91. A compliance resolution fee shall also be paid pursuant to section 26-9(o) and the rules adopted pursuant thereto.

The real estate commission may deny a cemetery salesperson's registration or re-registration application, or terminate a registration at its discretion, for the failure to comply with any rules."

SECTION 5. Section 441-45, Hawaii Revised Statutes, is amended to read as follows:

"§441-45 Penalty. In addition to the penalties otherwise provided by law, any cemetery [or], pre-need funeral authority, or cemetery salesperson that violates, or fails to comply with any of the provisions of this chapter or rules adopted pursuant thereto shall be fined not more than $5,000 for each violation."

SECTION 6. (a) There is established in the department of commerce and consumer affairs, for administrative purposes only, a temporary task force to be known as the death care industry task force.

(b) The director of commerce and consumer affairs, or the director's designee, shall serve as the chairperson of the task force.

(c) In addition to the director of commerce and consumer affairs, the task force shall consist of the following members or their representatives:

(1) The director of health;

(2) The supervising executive officer of the real estate branch of the department of commerce and consumer affairs;

(3) The director of the University of Hawaii Center on Aging;

(4) The county executive of the elderly affairs division, city and county of Honolulu; and

(5) The director of the executive office on aging.

(d) The chairperson of the task force shall invite representatives from the following groups to participate as members:

(1) State death care providers;

(2) Geriatrics program at the University of Hawaii;

(3) Hawaii Community Caregivers Network;

(4) Hawaii Pacific Gerontological Society; and

(5) Other interested parties, as determined by the chairperson.

(e) The task force shall perform the following tasks:

(1) Identify issues in the death care industry;

(2) Identify issues and inconsistencies in the existing death care industry regulatory framework;

(3) Examine the feasibility of consolidating oversight of the death care industry into an industry-wide funeral services regulatory board; and

(4) Develop a strategic plan to streamline the oversight of the death care industry.

(f) The task force shall submit a report of its findings and recommendations, including any proposed legislation, to the legislature as follows:

(1) An interim report no later than twenty days prior to the convening of the regular session of 2016; and

(2) A final report no later than twenty days prior to the convening of the regular session of 2017.

(g) The task force shall be dissolved on June 30, 2017.

SECTION 7. There is appropriated out of the general revenues of the State of Hawaii the sum of $ or so much thereof as may be necessary for fiscal year 2014-2015 for costs incurred by the death care industry task force pursuant to this Act.

The sum appropriated shall be expended by the department of health for the purposes of this Act.

SECTION 8. This Act does not affect rights and duties that matured, penalties that were incurred, and proceedings that were begun before its effective date.

SECTION 9. If any provision of this Act, or the application thereof to any person or circumstance, is held invalid, the invalidity does not affect other provisions or applications of the Act that can be given effect without the invalid provision or application, and to this end the provisions of this Act are severable.

SECTION 10. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 11. This Act shall take effect on January 1, 2015; provided that section 7 shall take effect on July 1, 2014.

INTRODUCED BY:	_____________________________

THE SENATE	S.B. NO.	2622
TWENTY-SEVENTH LEGISLATURE, 2014
STATE OF HAWAII