I am writing to express my deep concern about the $1.4 billion merger of the largest and second-largest funeral services companies in the U.S., Service Corporation International (SCI) and Stewart Enterprises, Inc. If this merger takes place, some of my constituents in the Washington, D.C. area could see an overwhelming increase in standard funeral costs.
Since 1999, SCI has acquired its second-, fourth-, and fifth-largest rivals, severely reducing competition in several major urban markets. As SCI’s market share has increased, the quality of its service unfortunately has not. Consumer complaints have included deceptive sales practices, unexpected charges and fees, sales of single burial plots to multiple individuals, the burying of loved ones in the wrong plot and even the exhumation and disposal of bodies in oversold cemeteries.
In … 2005 … the FTC noted that the preferences of ethnic and religious minorities limit their choice to facilities providing the customs and rituals appropriate to their specific needs. Aside from African-Americans and Chinese-Americans, the consent decree named Jewish Americans as a community likely to see adverse effects from a loss of competition. Such adverse effects are precisely what my constituents fear they will suffer if SCI is permitted to acquire Stewart.
In the Washington, D.C.-metropolitan area, Stewart owns the Hines-Rinaldi Funeral Home, the only low-cost funeral home that performs certain sacred Jewish rituals. Under a contract with the Jewish Funeral Practices Committee of Greater Washington, Hines-Rinaldi currently provides traditional Jewish funerals at a price that is almost $4,000 less than the next lowest-priced (SCI-owned) funeral home. Hines-Rinaldi also respects the traditional Jewish 30-day mourning period by waiting 30 days to bill bereaved families — a service that no other home in the area currently provides. These affordable and culturally appropriate services will almost certainly vanish if Hines-Rinaldi comes under SCI control. Moreover, if SCI acquires Hines-Rinaldi, it will control the four funeral homes that conduct over 70 percent of Jewish funerals in the D.C.-metro area.
The proposed SCI-Stewart merger affects an industry in which consumers must make financial decisions during times of profound emotional distress. Anti-competitive effects will take the greatest toll on low-income populations and on smaller ethnic and religious groups whose choice is already limited. I ask that the FTC carefully consider the detrimental effects that Jewish families in the Washington, D.C. area currently anticipate.
Brian E. Frosh
(D-Mont.)
Maryland
