[Federal Register Volume 73, Number 61 (Friday, March 28, 2008)]
[Notices]
[Pages 16681-16683]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-6451]


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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 July 31, 
2011, 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 July 31, 
2008.

DATES: Comments must be submitted on or before May 27, 2008.

ADDRESSES: Interested parties are invited to submit written comments. 
Comments should refer to ``Paperwork Comment: FTC File No. P084401'' to 
facilitate the organization of comments. A comment filed in paper form 
should include this reference both in the text and on the envelope and 
should be mailed or delivered to the following address: Federal Trade 
Commission/Office of the Secretary, Room H-135 (Annex S), 600 
Pennsylvania Avenue, N.W., Washington, D.C. 20580. Because paper mail 
in the Washington area and at the Commission is subject to delay, 
please consider submitting your comments in electronic form, as 
prescribed below. However, if the comment contains any material for 
which confidential treatment is requested, the comment must be filed in 
paper form, and the first page of the document must be clearly labeled 
``Confidential.''\1\
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    \1\ Commission Rule 4.2(d), 16 CFR 4.2(d). The comment must be 
accompanied by an explicit request for confidential treatment, 
including the factual and legal basis for the request, and must 
identify the specific portions of the comment to be withheld from 
the public record. The request will be granted or denied by the 
Commission's General Counsel, consistent with applicable law and the 
public interest. See Commission Rule 4.9(c), 16 CFR 4.9(c).
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    Comments filed in electronic form should be submitted by clicking 
on the following: https://secure.commentworks.com/ftc-funeralrulepra 
and following the instructions on the web-based form. To ensure that 
the Commission considers an electronic comment, you must file it on the 
web-based form at https://secure.commentworks.com/ftc-funeralrulepra. 
You also may visit http://www.regulations.gov to read this Rule, and 
may file an electronic comment through that website. The Commission 
will consider all comments that regulations.gov forwards to it.
    The FTC Act and other laws the Commission administers permit the 
collection of public comments to consider and use in this proceeding as 
appropriate. All timely and responsive public comments will be 
considered by the Commission and will be available to the public on the 
FTC website, to the extent practicable, at www.ftc.gov. As a matter of 
discretion, the FTC makes every effort to remove home contact 
information for individuals from the public comments it receives before 
placing those comments on the FTC website. More information, including 
routine uses permitted by the Privacy Act, may be found in the FTC's 
privacy policy at http://www.ftc.gov/ftc/privacy.htm.

FOR FURTHER INFORMATION CONTACT: Requests for additional information or

[[Page 16682]]

copies of the proposed information requirements for the Funeral Rule 
should be addressed to Craig Tregillis, Attorney, Division of Marketing 
Practices, Bureau of Consumer Protection, Federal Trade Commission, 
Room H-288, 600 Pennsylvania Ave., N.W., Washington, D.C. 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 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.
    The Funeral Rule ensures that consumers who are purchasing funeral 
goods and services have accurate information about the terms and 
conditions (especially prices) for such goods and services. 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 20,300 hours for recordkeeping, 101,389 hours 
for disclosures, and 40,600 hours for training, for a total of 162,000 
hours (rounded to the nearest thousand). This estimate is based on the 
number of funeral providers (approximately 20,300),\2\ the number of 
funerals annually (approximately 2.4 million),\3\ and the time needed 
to fulfill the information collection tasks required by the Rule.
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    \2\ The estimated number of funeral providers is from data 
provided on the National Funeral Directors Association (``NFDA'') 
website (see www.nfda.org/careers.php), which was accessed in March 
2008.
    \3\ The estimated number of funerals annually is taken from the 
National Center for Health Statistics, http://www.cdc.gov/nchs/. 
According to NCHS, 2,448,017 deaths occurred in the United States in 
2005, the most recent year for which final data is available. See 
National Vital Statistics Reports, vol. 56, no. 10 ``Deaths: Final 
Data for 2005,'' available athttp://www.cdc.gov/nchs/data/nvsr/nvsr56/nvsr56_10.pdf.
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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 20,300 
providers is 20,300 hours. This estimate is lower than FTC staff's 2005 
estimate of 21,500 hours due to a decrease in the number of funeral 
providers.
    Disclosure: 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 for this task. Thus, the total 
burden for 20,300 providers is 50,750 hours.
    2. Staff retains its 2005 estimate that 13% of funeral providers 
prepare written documentation of funeral goods and services selected by 
consumers specifically due to the Rule's mandate. The original 
rulemaking record indicated that 87% of funeral providers provided 
written documentation of funeral arrangements, even absent the Rule's 
requirements.\4\
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    \4\ The original version of the Funeral Rule required that 
funeral providers retain a copy of and give each customer a separate 
``Statement of Funeral Goods and Services Selected.'' The 1994 
amendments to the Rule eliminated that requirement, allowing instead 
for such disclosures to be incorporated into a written contract, 
bill of sale, or other record of a transaction that providers use to 
memorialize sales agreements with customers.
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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).\5\ 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 not already in 
compliance, for a total of 2,639 hours [(20,300 funeral providers x 
13%) x (20 statements per year x 3 minutes per statement)].
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    \5\ The FTC has provided its compliance guide to all funeral 
providers at no cost, and additional copies are available on the FTC 
website, www.ftc.gov, or by mail.
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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 industry indicates that only 
about 12% of funeral purchasers make telephone inquiries, with each 
call lasting an estimated ten minutes.\6\ Thus, assuming that the 
average purchaser who makes telephone inquiries places one call per 
funeral to determine prices, the estimated burden is 48,000 hours (2.4 
million 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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    \6\ No more recent information has thus far been obtainable; the 
Commission invites submission of more recent data or studies on this 
subject.
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    In sum, the burden due to the Rule's disclosure requirements totals 
101,389 hours (50,750 + 2,639 + 48,000).
    Training: In addition to the recordkeeping and disclosure-related 
tasks noted above, funeral homes may also have training requirements 
specifically attributable to the Rule. While staff believes that annual 
training burdens associated with the Rule should be minimal because 
Rule compliance is generally included in continuing education 
requirements for licensing and voluntary certification programs, staff 
estimates that, industry-wide, funeral homes should incur no more than 
40,600 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

[[Page 16683]]

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 employee) per firm would each require one-half 
hours, at most, per year, for such training. Thus, total estimated time 
for training is 40,600 hours (4 employees per firm x \1/2\ hour x 
20,300 providers).
    Estimated annual cost burden: $3,524,000 in labor costs and 
$1,226,000 in non-labor costs.
    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 $13, can perform 
the recordkeeping tasks required under the Rule. Based on the estimated 
hour burden of 20,300 hours, the estimated cost burden for 
recordkeeping is $263,900 ($13 per hour x 20,300 hours).
    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 $27.50 per hour, and one 
hour of clerical time, at $13 per hour, for a total of $54.25 per 
provider\7\ [($27.50 per hour x 1.5 hours) + ($13.00 per hour x 1 
hour)]. Thus, the estimated total cost burden for maintaining price 
lists is $1,101,275 ($54.25 per provider x 20,300 providers).
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    \7\ National Compensation Survey: Occupational Wages in the 
United States, June 2006, U.S. Department of Labor, Bureau of Labor 
Statistics (June 2007) (``BLS National Compensation Survey'') 
(citing the mean hourly earnings for funeral directors as $22.11/
hour), available at http://www.bls.gov/ncs/ocs/sp/ncbl0910.pdf. As 
in the past, staff has increased this figure on the assumption that 
the owner or managing director, who would be paid at a slightly 
higher rate, would be responsible for making pricing decisions. 
Clerical estimates are derived from the above source data, applying 
roughly a mid-range of mean hourly rates for potentially applicable 
clerical types, e.g., bookkeeping, file clerks, new accounts clerks, 
data entry.
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    The cost of providing written documentation of the goods and 
services selected by the consumer is 2,639 hours of managerial or 
professional time at approximately $27.50 per hour, or $72,572.50 
(2,639 hours x $27.50 per hour).
    The cost of responding to telephone inquiries about offerings or 
prices is 48,000 hours of managerial or professional time at $27.50 per 
hour, or $1,320,000 (48,000 hours x $27.50 per hour).
    The cost of training licensed and non-licensed funeral home staff 
to comply with the Funeral Rule is two hours per funeral home, with 
four employees of varying ranks each spending one-half hour on 
training. Consistent with estimates in the current clearance, the 
Commission is assuming that three funeral directors, at hourly wages of 
$27.50, $20, and $15, respectively, as well as one clerical or 
administrative staff member, at $13 per hour, require such training, 
for a total burden of 40,600 hours (20,300 funeral homes x 2 hours 
total per establishment), and $766,325 [($27.50 + $20 + $15 + $13) x 
\1/2\ hour per employee x 20,300 funeral homes].
    The total labor cost of the three disclosure requirements imposed 
by the Funeral Rule is $2,493,847.50 ($1,101,275 + $72,572.50 + 
$1,320,000). The total labor cost for recordkeeping is $263,900. The 
total labor cost for disclosures, recordkeeping and training is 
$3,524,000 ($263,900 for recordkeeping + $766,325 for training + 
$2,493,847.50 for disclosures), rounded to the nearest thousand.
    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 capital 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 price lists. Assuming 
that two price lists per funeral/cremation are created by industry to 
adhere to the Rule, 4,800,000 copies per year are made for a total cost 
of $1,200,000 (2,400,000 funerals per year x 2 copies per funeral x 
$.25 per copy). In addition, the estimated 2,639 providers not already 
providing written documentation of funeral arrangements apart from the 
Rule will incur additional printing and copying costs. Assuming that 
those providers use the standard two-page form shown in the Compliance 
Guide, at twenty-five cents per page, at an average of twenty funerals 
per year, the added cost burden would be $26,390 (2,639 providers x 20 
funerals per year x 2 pages per funeral x $.25). Thus, estimated non-
labor costs are $1,226,000, rounded to the nearest thousand.
    William Blumenthal
    General Counsel
[FR Doc. E8-6451 Filed 3-27-08: 8:45 am]
BILING CODE 6750-01-S