[Federal Register Volume 76, Number 88 (Friday, May 6, 2011)]
[Notices]
[Pages 26297-26299]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-11053]
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FEDERAL TRADE COMMISSION
Agency Information Collection Activities; Proposed Collection;
Comment Request; Extension
AGENCY: Federal Trade Commission (``Commission'' or ``FTC'').
ACTION: Notice.
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SUMMARY: The information collection requirements described below will
be submitted to the Office of Management and Budget (``OMB'') for
review, as required by the Paperwork Reduction Act (``PRA''). The FTC
is seeking public comments on its proposal to extend through September
30, 2014 the current Paperwork Reduction Act clearance for information
collection requirements contained in its Funeral Industry Practice Rule
(``Funeral Rule'' or ``Rule''). That clearance expires on September 30,
2011.
DATES: Comments must be submitted on or before July 5, 2011.
ADDRESSES: Interested parties may file a comment online or on paper, by
following the instructions in the Request for Comment part of the
SUPPLEMENTARY INFORMATION section below. Write ``Paperwork Comment: FTC
File No. P084401'' on your comment, and file your comment online at
https://ftcpublic.commentworks.com/ftc/funeralrulepra by following the
instructions on the Web-based form. If you prefer to file your comment
on paper, mail or deliver your comment to the following address:
Federal Trade Commission, Office of the Secretary, Room H-113 (Annex
J), 600 Pennsylvania Avenue, NW., Washington, DC 20580.
FOR FURTHER INFORMATION CONTACT: Requests for additional information or
copies of the proposed information requirements for the Funeral Rule
should be addressed to Craig Tregillus, Attorney, Division of Marketing
Practices, Bureau of Consumer Protection, Federal Trade Commission,
Room H-288, 600 Pennsylvania Ave., NW., Washington, DC 20580, (202)
326-2970.
SUPPLEMENTARY INFORMATION: Under the PRA, 44 U.S.C. 3501-3521, federal
agencies must obtain approval from OMB for each collection of
information they conduct or sponsor. ``Collection of information''
means agency requests or requirements that members of the public submit
reports, keep records, or provide information to a third party. 44
U.S.C. 3502(3), 5 CFR 1320.3(c). As required by section 3506(c)(2)(A)
of the PRA, the FTC is providing this opportunity for public comment
before requesting that OMB extend the existing paperwork clearance for
the Funeral Rule, 16 CFR Part 453 (OMB Control Number 3084-0025).
The Funeral Rule ensures that consumers who are purchasing funeral
goods and services have access to accurate itemized price information
so they can purchase only the funeral goods and services they want or
need. In particular, the Rule requires a funeral provider to: (1) Give
consumers a copy they can keep of the funeral provider's General Price
List (``GPL'') that itemizes the goods and services they offer; (2)
show consumers their Casket Price List (``CPL'') and their Outer Burial
Container Price List (``OBCPL'') at the outset of any discussion of
those items or their prices, and in any event before showing consumers
caskets or burial containers; (3) provide price information from their
price lists over the telephone; and (4) give consumers a Statement of
Funeral Goods and Services Selected (``SFGSS'') after determining the
funeral arrangements with the consumer (the ``arrangements
conference''). The Rule requires that funeral providers disclose this
information to consumers and maintain records to facilitate enforcement
of the Rule.
The estimated burden associated with the collection of information
required by the Rule is 19,902 hours for recordkeeping, 101,076 hours
for disclosures, and 39,804 hours for training, for a total of 160,782
hours. This estimate is based on the number of funeral providers
(approximately 19,902),\1\ the number of funerals per year
(approximately 2.4 million),\2\ and the time needed to fulfill the
information collection tasks required by the Rule.
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\1\ The estimated number of funeral providers is from 2010 data
provided on the National Funeral Directors Association (``NFDA'')
Web site (see http://www.nfda.org/about-funeral-service-/trends-and-statistics.html).
\2\ The estimated number of funerals conducted annually is
derived from the National Center for Health Statistics (``NCHS''),
http://www.cdc.gov/nchs/. According to NCHS, 2,436,682 deaths
occurred in the United States in 2009, the most recent year for
which final data is available. See National Vital Statistics
Reports, vol. 59, no. 4 ``Preliminary Data for 2009,'' available at
http://www.cdc.gov/nchs/data/nvsr/nvsr59/nvsr59_04.pdf. Staff
believes this is a conservative estimate because not all remains go
to a funeral provider covered by the Rule (e.g., remains sent
directly to a crematory that does not sell urns; remains donated to
a medical school, etc.).
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Recordkeeping: The Rule requires that funeral providers retain
copies of price lists and statements of funeral goods and services
selected by consumers. Based on a maximum average burden of one hour
per provider per year for this task, the total burden for the 19,902
providers is 19,902 hours. This estimate is lower than FTC staff's 2008
estimate of 20,300 hours due to a decrease in the number of funeral
providers.
Disclosure: As noted above, the Rule requires that funeral
providers: (1) Maintain current price lists for funeral goods and
services, (2) provide written documentation of the funeral goods and
services selected by consumers making funeral arrangements, and (3)
provide information about funeral prices in response to telephone
inquiries.
1. Maintaining current price lists requires that funeral providers
revise their price lists from time to time throughout the year to
reflect price changes. Staff estimates, consistent with its current
clearance, that this task requires a maximum average burden of two and
one-half hours per provider per year. Thus, the total burden for 19,902
providers is 49,755 hours.
2. Staff retains its prior estimate that 13% of funeral providers
prepare written documentation of funeral goods
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and services selected by consumers solely because the Rule mandates
this disclosure. The original rulemaking record indicated that 87% of
funeral providers provided written documentation of funeral
arrangements, even absent the Rule's requirements.\3\
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\3\ In a 2002 public comment, the NFDA asserted that nearly
every funeral home had been providing consumers with some kind of
final statement in writing even before the Rule took effect.
Nonetheless, in an abundance of caution, staff continues to retain
its prior estimate based on the original rulemaking record.
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According to the rulemaking record, the 13% of funeral providers
who did not provide written documentation prior to enactment of the
Rule are typically the smallest funeral homes. The written
documentation requirement can be satisfied through the use of a
standard form, an example of which the FTC has provided to all funeral
providers in its compliance guide.\4\ Based on an estimate that these
smaller funeral homes arrange, on average, approximately twenty
funerals per year and that it would take each of them about three
minutes to record prices for each consumer on the standard form, FTC
staff estimates that the total burden associated with the written
documentation requirement is one hour per provider, for a total of
2,587 hours [(19,902 funeral providers x 13%) x (20 statements per year
x 3 minutes per statement)].
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\4\ The compliance guide is available at http://business.ftc.gov/documents/bus05-complying-funeral-rule.
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3. The Funeral Rule also requires funeral providers to answer
telephone inquiries about the provider's offerings or prices.
Information received in 2002 from the NFDA indicates that only about
12% of funeral purchasers make telephone inquiries, with each call
lasting an estimated ten minutes.\5\ Thus, assuming that the average
purchaser who makes telephone inquiries places one call per funeral to
determine prices,\6\ the estimated burden is 48,734 hours (2,436,682
funerals per year x 12% x 10 minutes per inquiry). This burden likely
will decline over time as consumers increasingly rely on the Internet
for funeral price information.
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\5\ No more recent information thus far has been available. The
Commission invites submission of more recent data or studies on this
subject.
\6\ Although consumers who pre-plan their own arrangements may
comparison shop and call more than one funeral home for pricing and
other information, consumers making ``at need'' arrangements after a
death are less likely to take the time to seek pricing information
from more than one home. Many fail to seek any pricing information
by telephone. Staff therefore believes that an average of one call
per funeral is a conservative assumption.
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In sum, the burden due to the Rule's disclosure requirements totals
101,076 hours (49,755 + 2,587 + 48,734).
Training: In addition to the recordkeeping and disclosure-related
tasks noted above, funeral homes may also have training requirements
specifically attributable to the Rule. Staff believes that annual
training burdens associated with the Rule should be minimal because
Rule compliance is generally included in continuing education
requirements for state licensing and voluntary certification programs.
Staff estimates that, industry-wide, funeral homes would incur no more
than 39,804 hours related to training specific to the Rule each year.
This estimate is consistent with staff's assumption for the current
clearance that an ``average'' funeral home consists of approximately
five employees (full-time and part-time employment combined), but with
no more than four of them having tasks specifically associated with the
Funeral Rule. Staff retains its estimate that each of the four
employees (three directors and a clerical receptionist) per firm would
each require one-half hour, at most, per year, for such training.\7\
Thus, total estimated time for training is 39,804 hours (4 employees
per firm x \1/2\; hour x 19,902 providers).
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\7\ Funeral homes, depending on size and/or other factors, may
be run by as few as one owner, manager, or other funeral director to
multiple directors at various compensation levels. Extrapolating
from past NFDA survey input, staff has theorized an ``average''
funeral home of approximately five employees, with management
personnel and a clerical receptionist being those who would require
training for Funeral Rule compliance. Staff conservatively assumes
that the ``average'' home would consist of an owner/manager, funeral
director/embalmer, and, as further sub-classified by the NFDA, a
``funeral director only.'' In addition to that, staff assumes the
home would also have one clerical receptionist. Compliance training
for other employees (e.g., drivers, maintenance personnel) would be
inapplicable.
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Labor costs: Labor costs are derived by applying appropriate hourly
cost figures to the burden hours described above. The hourly rates used
below are averages.
Clerical personnel, at an estimated hourly rate of $15,\8\ can
perform the recordkeeping tasks required under the Rule. Based on the
estimated hours burden of 19,902 hours, estimated labor cost for
recordkeeping is $298,530.
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\8\ Based on the ``National Compensation Survey: Occupational
Wages in the United States, 2009,'' U.S. Department of Labor, Bureau
of Labor Statistics (June 2010) (``BLS National Compensation
Survey''), available at http://www.bls.gov/ncs/ocs/sp/nctb1346.pdf
http://www.bls.gov/ncs/ocs/sp/ncbl0910.pdf. Clerical estimates are
derived from the above source data, rounded upward, for
``receptionist and information clerks.''
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The two and one-half hours required of each provider, on average,
to update price lists should consist of approximately one and one-half
hours of managerial or professional time, at an estimated $35 per
hour,\9\ and one hour of clerical time, at $15 per hour, for a total of
$67.50 per provider [($35 per hour x 1.5 hours) + ($15 per hour x 1
hour)]. Thus, the estimated total labor cost burden for maintaining
price lists is $1,343,385 ($67.50 per provider x 19,902 providers).
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\9\ The hourly rate is derived from the median annual salary of
a funeral home owner/manager, found in the 2010 NFDA Member
Compensation Survey. See http://www.nfda.org/news-a-events/all-press-releases/2289-nfda-releases-results-of-2010-member-compensation-survey.html. Dividing the median annual salary an
assumed 2,000 hour work year yields the hourly rate, albeit broadly
rounded upward to $35.
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The incremental cost to the 13% of small funeral providers who
would not otherwise supply written documentation of the goods and
services selected by the consumer, as previously noted, is 2,587 hours.
Assuming managerial or professional time for these tasks at
approximately $35 per hour, the associated labor cost would be $90,545
(2,587 hours x $35 per hour).
As previously noted, staff estimates that 48,734 hours of
managerial or professional time is required annually to respond to
telephone inquiries about prices.\10\ The cost of 48,734 hours of
managerial or professional time for responding to telephone inquiries
about prices at $35 per hour, is $1,705,690 (48,734 hours x $35 per
hour).
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\10\ Although some funeral providers may permit staff who are
not funeral directors to provide price information by telephone, the
great majority reserve that task to a licensed funeral director.
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Based on past consultations with funeral directors, FTC staff
estimates that funeral homes will require no more than two hours of
training of licensed and non-licensed funeral home staff to comply with
the Funeral Rule,\11\ with four employees of varying types each
spending one-half hour on training. Consistent with past assumptions
stated above,\12\ paired with updated estimates, the Commission is
assuming that three funeral directors, at hourly wages of $35, $23, and
$20,\13\ respectively, as
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well as one clerical or administrative staff member, at $15 per hour,
require such training, for a total burden of 39,804 hours (19,902
funeral homes x 2 hours total per establishment), and $925,443 [($35 +
$23 + $20 + $15) x [frac12] hour per employee x 19,902 funeral homes].
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\11\ Rule compliance is generally included in continuing
education requirements for licensing and voluntary certification
programs. Moreover, as noted above, the FTC provides its compliance
guide to all funeral providers at no cost, and it is available on
the FTC Web site. See supra note 4. Additionally, the NFDA provides
online guidance for compliance with the Rule: http://www.nfda.org/onlinelearning-ftc.html.
\12\ See note 7 and accompanying text.
\13\ The hourly rates are derived from median annual salaries of
a funeral home owner/manager, funeral director/embalmer, and
``funeral director only'' found in the 2010 NFDA Member Compensation
Survey. See http://www.nfda.org/news-a-events/all-press-releases/2289-nfda-releases-results-of-2010-member-compensation-survey.html.
Hourly rates were then determined by dividing those salaries by an
assumed 2,000 hour work year, then rounded.
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The total labor cost of the three disclosure requirements imposed
by the Funeral Rule is $3,139,620 ($1,343,385 + $90,545 + $1,705,690).
The total labor cost for recordkeeping is $298,530. The total labor
cost for disclosures, recordkeeping, and training is $4,363,593
($3,139,620 for disclosures + $298,530 for recordkeeping + $925,443 for
training).
Capital or other non-labor costs: The Rule imposes minimal capital
costs and no current start-up costs. The Rule first took effect in 1984
and the revised Rule took effect in 1994, so funeral providers should
already have in place necessary equipment to carry out tasks associated
with Rule compliance. Moreover, most funeral homes already have access,
for other business purposes, to the ordinary office equipment needed
for compliance, so the Rule likely imposes minimal additional capital
expense.
Compliance with the Rule, however, does entail some expense to
funeral providers for printing and duplication of required disclosures.
Assuming that one copy of the GPL is provided to consumers for each
funeral or cremation conducted, at $.25 per copy, as required by the
Rule,\14\ this would amount to 2,436,682 copies per year at a
cumulative industry cost of $624,171 (2,436,682 funerals per year\15\ x
$.25 per price list). In addition, the funeral providers that furnish
consumers with an SFGSS solely because of the Rule's mandate will incur
additional printing and copying costs. Assuming that those 2,587
providers (19,902 funeral providers x 13%) use the standard two-page
form SFGSS shown in the compliance guide, at twenty-five cents per
copy, at an average of twenty funerals per year, the added cost burden
would be $12,935 (2,587 providers x 20 funerals per year x $.25). Thus,
estimated non-labor costs total $637,106.
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\14\ Although copies of the CPL and OBCPL must be shown to
consumers, the Rule does not require that they be given to
consumers. Thus, the cost of printing a single copy of these two
disclosures to show consumers is de minimis, and is not included in
this estimate of printing costs.
\15\ See note 2 and accompanying text.
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Request for Comment
You can file a comment online or on paper. For the Commission to
consider your comment, we must receive it on or before July 5, 2011.
Write ``Paperwork Comment: FTC File No. P084401'' on your comment. Your
comment--including your name and your state--will be placed on the
public record of this proceeding, including, to the extent practicable,
on the public Commission Web site, at http://www.ftc.gov/os/publiccomments.shtm. As a matter of discretion, the Commission tries to
remove individuals' home contact information from comments before
placing them on the Commission Web site.
Because your comment will be made public, you are solely
responsible for making sure that your comment doesn't include any
sensitive personal information, like anyone's Social Security number,
date of birth, driver's license number or other state identification
number or foreign country equivalent, passport number, financial
account number, or credit or debit card number. You are also solely
responsible for making sure that your comment doesn't include any
sensitive health information, like medical records or other
individually identifiable health information. In addition, don't
include any ``[t]rade secret or any commercial or financial information
which is obtained from any person and which is privileged or
confidential * * *, '' as provided in Section 6(f) of the FTC Act, 15
U.S.C. 46(f), and FTC Rule 4.10(a)(2), 16 CFR 4.10(a)(2). If you want
the Commission to give your comment confidential treatment, you must
file it in paper form, with a request for confidential treatment, and
you have to follow the procedure explained in FTC Rule 4.9(c), 16 CFR
4.9(c). Your comment will be kept confidential only if the FTC General
Counsel, in his or her sole discretion, grants your request in
accordance with the law and the public interest.
Postal mail addressed to the Commission is subject to delay due to
heightened security screening. As a result, we encourage you to submit
your comments online, or to send them to the Commission by courier or
overnight service. To make sure that the Commission considers your
online comment, you must file it at https://ftcpublic.commentworks.com/ftc/funeralrulepra, by following the instructions on the web-based
form. If this Notice appears at http://www.regulations.gov/#!home, you
also may file a comment through that Web site.
If you file your comment on paper, write ``Paperwork Comment: FTC
File No. P084401'' on your comment and on the envelope, and mail or
deliver it to the following address: Federal Trade Commission, Office
of the Secretary, Room H-113 (Annex J), 600 Pennsylvania Avenue, NW.,
Washington, DC 20580. If possible, submit your paper comment to the
Commission by courier or overnight service.
Visit the Commission Web site at http://www.ftc.gov to read this
Notice and the news release describing it. The FTC Act and other laws
that the Commission administers permit the collection of public
comments to consider and use in this proceeding as appropriate. The
Commission will consider all timely and responsive public comments that
it receives on or before July 5, 2011. You can find more information,
including routine uses permitted by the Privacy Act, in the
Commission's privacy policy, at http://www.ftc.gov/ftc/privacy.htm.
The FTC invites comments on: (1) Whether the proposed collection of
information is necessary for the proper performance of the functions of
the agency, including whether the information will have practical
utility; (2) the accuracy of the agency's estimate of the burden of the
proposed collection of information, including the validity of the
methodology and assumptions used; (3) ways to enhance the quality,
utility, and clarity of the information to be collected; and (4) ways
to minimize the burden of the collection of information on those who
are to respond, including through the use of appropriate automated,
electronic, mechanical, or other technological collection techniques or
other forms of information technology, e.g., permitting electronic
submission of responses.
Willard K. Tom,
General Counsel.
[FR Doc. 2011-11053 Filed 5-5-11; 8:45 am]
BILLING CODE 6750-01-P