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Wisconsin Department of Safety and Professional Services Division of Policy Development
1400 E. Washington Ave
PO Box 8366 Madison WI 53708-8366
Phone: 608-266-2112 Web: http://dsps.wi.gov
Email: [email protected]
Scott Walker, Governor
Laura Gutiérrez, Secretary
CEMETERY BOARD
Room 121C, 1400 E. Washington Avenue, Madison
Contact: Dan Williams (608) 266-2112
September 28, 2017
The following agenda describes the issues that the Board plans to consider at the meeting. At the
time of the meeting, items may be removed from the agenda. Please consult the meeting minutes for
a description of the actions of the Board.
AGENDA
9:30 A.M.
OPEN SESSION – CALL TO ORDER – ROLL CALL
A. Adoption of Agenda (1-3)
B. Approval of Minutes of May 9, 2017 (4-8)
C. Administrative Matters – Discussion and Consideration
1) Staff Updates
2) Board Members – Term Expiration Dates
a) Kathleen Cantu – 07/01/2012
b) Patricia Grathen – 07/01/2018
c) Francis Groh – 07/01/2020 (Reappointed but not yet confirmed)
d) John Reinemann – 07/01/2020 (Reappointed but not yet confirmed)
e) Bernard Schroedl – 07/01/2018
f) Vacant – Cemetery Member
D. 9:30 A.M. Public Hearing on Clearinghouse Rule 17-050 Relating to Mausoleums and
Burial Records (9-18) 1) Review and Respond to Public Comments and Clearinghouse Report
E. Legislative and Administrative Rule Matters – Discussion and Consideration
1) Update on Pending and Possible Rulemaking Projects
F. Court Ruling on E. Glenn Porter, III and Highland Memorial Park, Inc. V. State of
Wisconsin, Dave Ross and Funeral Directors Examining Board – Discussion and
Consideration (19-46)
G. Items Received After Preparation of the Agenda – Discussion and Consideration
1) Introductions, Announcements and Recognition
2) Election of Board Officers
3) Appointment of Board Liaison(s)
1
4) Administrative Matter
5) Education and Examination Matters
6) Credentialing Matters
7) Practice Matters
8) Legislation/Administrative Rule Matters
9) Liaison Report(s)
10) Informational Item(s)
11) Disciplinary Matters
12) Presentations of Petitions for Summary Suspension
13) Petitions for Designation of Hearing Examiner
14) Presentation of Proposed Stipulations, Final Decisions and Orders
15) Presentation of Proposed Final Decision and Orders
16) Presentation of Interim Orders
17) Petitions for Re-Hearing
18) Petitions for Assessments
19) Petitions to Vacate Orders
20) Requests for Disciplinary Proceeding Presentations
21) Motions
22) Petitions
23) Appearances from Requests Received or Renewed
24) Speaking Engagement(s), Travel, or Public Relation Request(s)
H. Public Comments
CONVENE TO CLOSED SESSION to deliberate on cases following hearing (s. 19.85(1)(a),
Stats.); to consider licensure or certification of individuals (s. 19.85(1)(b), Stats.); to consider
closing disciplinary investigations with administrative warnings (ss. 19.85 (1)(b), and 440.205,
Stats.); to consider individual histories or disciplinary data (s. 19.85 (1)(f), Stats.); and to
confer with legal counsel (s. 19.85(1)(g), Stats.).
I. Deliberation on Division of Legal Services and Compliance (DLSC) Matters
1) Monitoring
2) Administrative Warnings
3) Proposed Stipulations, Final Decisions and Orders
4) Case Closings
J. Deliberation of Items Received After Preparation of the Agenda
1) Education and Examination Matters
2) Credentialing Matters
3) Disciplinary Matters
4) Monitoring Matters
5) Professional Assistance Procedure (PAP) Matters
6) Petitions for Summary Suspensions
7) Petitions for Designation of Hearing Examiner
8) Proposed Stipulations, Final Decisions and Orders
9) Administrative Warnings
10) Review of Administrative Warnings
2
11) Proposed Final Decision and Orders
12) Matters Relating to Costs/Orders Fixing Costs
13) Case Closings
14) Proposed Interim Orders
15) Petitions for Assessments and Evaluations
16) Petitions to Vacate Orders
17) Remedial Education Cases
18) Motions
19) Petitions for Re-Hearing
20) Appearances from Requests Received or Renewed
K. Consulting with Legal Counsel
RECONVENE TO OPEN SESSION IMMEDIATELY FOLLOWING CLOSED SESSION
L. Vote on Items Considered or Deliberated Upon in Closed Session, if Voting is Appropriate
M. Open Session Items Noticed Above Not Completed in the Initial Open Session
ADJOURNMENT
NEXT MEETING DATE: NOVEMBER 14, 2017
********************************************************************************
MEETINGS AND HEARINGS ARE OPEN TO THE PUBLIC, AND MAY BE CANCELLED
WITHOUT NOTICE.
Times listed for meeting items are approximate and depend on the length of discussion and voting. All
meetings are held at 1400 East Washington Avenue, Madison, Wisconsin, unless otherwise noted. In order
to confirm a meeting or to request a complete copy of the board’s agenda, please call the listed contact
person. The board may also consider materials or items filed after the transmission of this notice. Times
listed for the commencement of disciplinary hearings may be changed by the examiner for the convenience
of the parties. Interpreters for the hearing impaired provided upon request by contacting the Affirmative
Action Officer, 608-266-2112.
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Cemetery Board
Meeting Minutes
May 9, 2017
Page 1 of 5
CEMETERY BOARD
MEETING MINUTES
MAY 09, 2017
PRESENT: Patricia Grathen, Francis Groh, John Reinemann, Bernard Schroedl
EXCUSED: Kathleen Cantu
STAFF: Dan Williams, Executive Director; Laura Smith, Bureau Assistant; Greg
DiMiceli, Administrative Rules Coordinator and other Department staff.
CALL TO ORDER
Francis Groh, Vice Chair, called the meeting to order at 9:31 a.m. A quorum of four (4) members
was confirmed.
ADOPTION OF AGENDA
MOTION: John Reinemann moved, seconded by Bernard Schroedl, to approve the
agenda as published. Motion carried unanimously.
APPROVAL OF MINUTES OF NOVEMBER 28, 2016
MOTION: Bernard Schroedl moved, seconded by John Reinemann, to approve the
minutes of November 28, 2016 as published. Motion carried unanimously.
ADMINISTRATIVE MATTERS
Election of Officers
Chair
NOMINATION: Bernard Schroedl nominated Francis Groh for the Office of Chair.
Dan Williams called for nominations three (3) times.
Francis Groh was elected as Chair by unanimous consent.
Vice Chair
NOMINATION: Francis Groh nominated Bernard Schroedl for the Office of Vice Chair.
Dan Williams called for nominations three (3) times.
Bernard Schroedl was elected as Vice Chair by unanimous consent.
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Cemetery Board
Meeting Minutes
May 9, 2017
Page 2 of 5
Secretary
NOMINATION: Francis Groh nominated Patricia Grathen for the Office of Secretary.
Dan Williams called for nominations three (3) times.
Patricia Grathen was elected as Secretary by unanimous consent.
2017 ELECTION RESULTS
Board Chair Francis Groh
Vice Chair Bernard Schroedl
Secretary Patricia Grathen
Liaison Appointments
2017 LIAISON APPOINTMENTS
Screening Panel Patricia Grathen, Francis Groh
Alternate – Bernard Schroedl
Credentialing Liaisons Bernard Schroedl
Alternate – Francis Groh
Conveyance Liaison Francis Groh
Monitoring Liaison Bernard Schroedl
Legislative Liaison Francis Groh, John Reinemann
Annual Report Liaison Francis Groh
MOTION: Bernard Schroedl moved, seconded by John Reinemann, to affirm the
Chair’s appointment of liaisons for 2017. Motion carried unanimously.
Delegation Motions
Delegated Authority for Urgent Matters
MOTION: John Reinemann moved, seconded by Bernard Schroedl, that, in order to
facilitate the completion of assignments between meetings, the Board
delegates its authority to the Chair to appoint liaisons to carry out the
duties of the Board in accordance with the law. Motion carried
unanimously.
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Cemetery Board
Meeting Minutes
May 9, 2017
Page 3 of 5
Document Signature Delegation
MOTION: Bernard Schroedl moved, seconded by Patricia Grathen, the Board
delegates authority to the Chair to sign documents on behalf of the Board.
In order to carry out duties of the Board, the Chair has the ability to
delegate this signature authority to the Board’s Executive Director for
purposes of facilitating the completion of assignments during or between
meetings. Motion carried unanimously.
Credentialing Authority Delegations
MOTION: Patricia Grathen moved, seconded by Bernard Schroedl, to delegate
authority to the Credentialing Liaisons to address all issues related to
credentialing matters. Motion carried unanimously.
Monitoring Delegation
MOTION: John Reinemann moved, seconded by Bernard Schroedl, to adopt the
‘Roles and Authorities Delegated to the Monitoring Liaison and
Department Monitor’ document as presented. Motion carried
unanimously.
Conveyance Delegation
MOTION: Bernard Schroedl moved, seconded by John Reinemann, to delegate
authority to the Conveyance Liaison to review any requests submitted to
the Cemetery Board under Wis. Stats. 157.08(2)(b), request additional
information as necessary, and make the final decision to approve or object.
Motion carried unanimously.
Legislative Liaison Delegation
MOTION: Bernard Schroedl moved, seconded by Patricia Grathen, to delegate
authority to the Legislative Liaison(s) to address issues related to
legislative matters with approval by the Chair. Motion carried
unanimously.
Annual Report Liaison
MOTION: Bernard Schroedl moved, seconded by Patricia Grathen, to delegate
authority to the Annual Report Liaison to review with DSPS staff annual
reports and make recommendations as needed. DSPS staff will follow up
with the Annual Report Liaison as to recommendations that were made.
Motion carried unanimously.
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Cemetery Board
Meeting Minutes
May 9, 2017
Page 4 of 5
LEGISLATIVE AND ADMINISTRATIVE RULE MATTERS – DISCUSSION AND
CONSIDERATION
Proposal Relating to CB 1-5, Cemetery Authorities, Salespersons and Preneed Sellers
MOTION: John Reinemann moved, seconded by Bernard Schroedl, to authorize the
Chair to approve the preliminary rule draft of CB 1-5 relating to Cemetery
Authorities, Salespersons, and Preneed Sellers for posting of economic
impact comments and submission to the Clearinghouse. Motion carried
unanimously.
CONVENE TO CLOSED SESSION
MOTION: Bernard Schroedl moved seconded by John Reinemann, to convene to
closed session to deliberate on cases following hearing (s. 19.85(1)(a),
Stats.); to consider licensure or certification of individuals (s. 19.85(1)(b),
Stats.); to consider closing disciplinary investigations with administrative
warnings (ss. 19.85 (1)(b), and 440.205, Stats.); to consider individual
histories or disciplinary data (s. 19.85 (1)(f), Stats.); and to confer with
legal counsel (s. 19.85(1)(g), Stats.). The Chair read the language of the
motion. The vote of each member was ascertained by voice vote. Roll Call
Vote: Patricia Grathen-yes; Francis Groh-yes; John Reinemann-yes;
Bernard Schroedl-yes. Motion carried unanimously.
The Board convened into Closed Session at 10:56 a.m.
RECONVENE TO OPEN SESSION
MOTION: John Reinemann moved, seconded by Bernard Schroedl, to reconvene in
open session. Motion carried unanimously.
The Board reconvened into open session at 10:58 a.m.
VOTE ON ITEMS CONSIDERED OR DELIBERATED UPON IN CLOSED SESSION,
IF VOTING IS APPROPRIATE
MOTION: Patricia Grathen moved, seconded by John Reinemann, to affirm all
motions made in closed session. Motion carried unanimously.
(Be advised that any recusals or abstentions reflected in the closed session motions stand for the
purposes of the affirmation vote.)
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Cemetery Board
Meeting Minutes
May 9, 2017
Page 5 of 5
DELIBERATION ON DIVISION OF LEGAL SERVICES AND COMPLIANCE (DLSC)
MATTERS
Case Closing
16 RLC 003
MOTION: Bernard Schroedl moved, seconded by Patricia Grathen, to close DLSC
Case No. 16 RLC 003 against W.M.P.C. for No Violation. Motion carried
unanimously.
BOARD TRAINING REVIEW – PUBLIC RECORDS AND ETHICS AND LOBBYING
The Board reviewed training information relating to Public Records and Ethics and Lobbying
requirements at this meeting.
ADJOURNMENT
MOTION: Bernard Schroedl moved, seconded by John Reinemann, to adjourn the
meeting. Motion carried unanimously.
The meeting adjourned at 11:00 a.m.
8
State of Wisconsin Department of Safety & Professional Services
Revised 12/2016
AGENDA REQUEST FORM 1) Name and Title of Person Submitting the Request: Greg DiMiceli Administrative Rules Coordinator
2) Date When Request Submitted: September 7, 2017
Items will be considered late if submitted after 12:00 p.m. on the deadline date which is 8 business days before the meeting
3) Name of Board, Committee, Council, Sections: Cemetery Board
4) Meeting Date: September 28, 2017
5) Attachments:
Yes
No
6) How should the item be titled on the agenda page? Public Hearing on Clearinghouse Rule 17-050 relating to mausoleums and burial records.
7) Place Item in:
Open Session
Closed Session
8) Is an appearance before the Board being scheduled?
Yes (Fill out Board Appearance Request)
No
9) Name of Case Advisor(s), if required:
10) Describe the issue and action that should be addressed: Hold Public Hearing at 9:30 Discuss any public hearing comments. Review, discuss and respond to any Clearinghouse comments.
11) Authorization Signature of person making this request Date
Greg DiMiceli
Supervisor (if required) Date
Executive Director signature (indicates approval to add post agenda deadline item to agenda) Date
Directions for including supporting documents: 1. This form should be attached to any documents submitted to the agenda. 2. Post Agenda Deadline items must be authorized by a Supervisor and the Policy Development Executive Director. 3. If necessary, provide original documents needing Board Chairperson signature to the Bureau Assistant prior to the start of a meeting.
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Page 1
STATE OF WISCONSIN
CEMETERY BOARD
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IN THE MATTER OF RULE-MAKING : PROPOSED ORDER OF THE
PROCEEDINGS BEFORE THE : CEMETERY BOARD
CEMETERY BOARD : ADOPTING RULES
: (CLEARINGHOUSE RULE )
------------------------------------------------------------------------------------------------------------
PROPOSED ORDER
An order of the Wisconsin Cemetery Board to renumber and amend CB 5.03 (3), to amend
CB 2 (title), and to create CB 1.015 (2), CB 2.05, CB 6, and CB 6.05 (Note) relating to
mausoleums and burial records.
Analysis prepared by the Department of Safety and Professional Services.
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ANALYSIS
Statutes interpreted: Sections 157.12 (2), 157.62 (5), and 440.905
Statutory authority: Sections 157.12 (2), 157.62 (5), and 440.905
Explanation of board authority: Section 157.12 (2) (a) requires the cemetery board to
promulgate rules governing the location, material, and construction of mausoleums. Section
440.905 grants the cemetery board rule-making authority and the authority to promulgate
rules relating to the regulation of cemetery authorities, cemetery salespersons, and cemetery
preneed sellers.
Related statute or rule: SPS 361.30, SPS 361.36 (1) (f), SPS 361.41 (3), SPS 361.50 and
SPS 362.3100, and Wis. Stat. 157, Wis. Stat. 440.
Plain language analysis:
The rule creates a cemetery burial record and provides cemetery board guidance for the
oversight of mausoleum construction and inspections.
Summary of, and comparison with, existing or proposed federal regulation:
None
Comparison with rules in adjacent states:
Illinois: In 2010 the state of Illinois passed the cemetery oversight act. This act included
provisions guiding cemetery licensing, reporting, ethics, continuing education, and cemetery
sales.
Iowa: All forms, certificates and reports pertaining to the registration of death events are the
property of the Iowa regulatory agency and are required to be surrendered to the state registrar
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Page 2
upon demand. Under Iowa code 641- 97.17 and 641- 97.18 the funeral director is responsible
for recording final disposition records.
Michigan: Cemeteries are required maintain accurate, complete, and legible records of any
books, contracts, records, or documents pertaining to, prepared in, or generated by, the
cemetery operation including, but not limited to, forms, reports, accounting records, ledgers,
internal audit records, correspondence, and personnel records. All records are required to be
maintained for at least 7 years from the date of record completion.
Minnesota: Cemeteries are not licensed by the state of Minnesota but are governed by local
units of government.
Summary of factual data and analytical methodologies:
The cemetery board reviewed the rule and statutory requirements.
Analysis and supporting documents used to determine effect on small business or in
preparation of economic impact analysis:
The rule will be posted for public comment on the economic impact of the proposed rule,
including how this proposed rule may affect businesses, local government units, and
individuals for a period of 14 days.
Fiscal Estimate and Economic Impact Analysis:
The department is currently soliciting information and advice from businesses, local
government units, and individuals in order to prepare the economic impact analysis.
Effect on small business:
These proposed rules do not have an economic impact on small businesses, as defined in s.
227.114 (1), Stats. The Department’s Regulatory Review Coordinator may be contacted by
email at [email protected], or by calling (608) 267-2435.
Agency contact person:
Greg DiMiceli, Administrative Rules Coordinator, Department of Safety and Professional
Services, Division of Policy Development, 1400 East Washington Avenue, P.O. Box 8366,
Madison, Wisconsin 53708; telephone 608-266-0955; email at
Place where comments are to be submitted and deadline for submission:
Comments may be submitted to Greg DiMiceli, Rule Coordinator, Department of Safety and
Professional Services, Division of Policy Development, 1400 East Washington Avenue, P.O.
Box 8366, Madison, WI 53708-8366, or by email to [email protected].
Comments must be received on or before (TBD) to be included in the record of rule-making
proceedings.
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Page 3
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TEXT OF RULE
SECTION 1. CB 2 (title) is amended to read:
FILING OF ANNUAL REPORTS AND MAINTAINING BURIAL RECORDS BY CEMETERY AUTHORITIES AND PRENEED SELLERS.
SECTION 2. CB 2.05 is created to read:
CB 2.05. Burial Record. (1) A cemetery authority or licensee shall maintain a record for all
human remains buried within a cemetery. This record shall include the following
information:
(a) The name of the deceased.
(b) The last-known address of the deceased.
(c) The date of birth of the deceased.
(d) The date of death as listed on the disposition of human remains.
(e) The date remains are placed in the grave, niche, or crypt.
(f) The exact location in the cemetery where the human remains are buried or
placed. The specific location shall correspond to the map or plat maintained by
the cemetery authority or licensee.
(g) The name of the person authorizing the burial and his or her relationship to the
deceased.
(h) The name of the funeral establishment, as defined in s. 445.01 (6).
(i) The type of burial vault used, if any, including, poured concrete, precast
concrete, plastic, or polyurethane.
(j) The type of the grave marker or monument, including granite, along with the
marker style, including, flush, upright, or slanted.
(2) A cemetery authority or licensee shall record burial information under CB 2.05 (1) no
more than 10 business days following the burial. All burial records completed after the
effective date of this rule shall be maintained either in an electronic format which is easily
accessible for review or in a legibly written format.
(3) All burial records shall be maintained by the cemetery authority. Upon conveyance of a
cemetery, burial records shall be transferred to the new cemetery authority who shall then
maintain the transferred records.
Section 3. CB 5.03 (3) is renumbered and amended to read:
CB 1.015. Definitions. As used in this chapter: (3 1) “Board” means the cemetery board.
Section 4. CB 1.015 (2) is created to read:
CB 1.015 (2). “Mausoleum” has the meaning given in s. 157.061 (9).
SECTION 5. CB 6 is created to read:
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Page 4
Chapter CB 6. MAUSOLEUMS.
CB 6.01. Mausoleum construction review. The board, or its designee, shall review the
location, construction plans, building material, and the construction of mausoleums. The
board shall make this review under the requirements of SPS 361.30 and s. 157.12 Stats.
CB 6.02. Mausoleum plan approval. Mausoleum construction plans shall be reviewed by
the board, or its designee. Plans shall be reviewed under SPS 361.30 and s. 440.92 (2) (e),
Stats. Plans shall expire 3 years after the date indicated on the approved building plans of the
building shell if not closed within those 3 years.
CB 6.03. Mausoleum construction code. In addition to board construction requirements,
mausoleum construction shall follow the requirements of SPS 362.3100 and the International
Building Code, chapter 31. Mausoleum structures shall be designed, constructed, and
maintained in accordance with IBC chapter 31. Mausoleums shall be classified as a Group
S−1 storage occupancy and shall be constructed of reinforced concrete or other materials of
similar durability.
CB 6.04. Mausoleum construction. A mausoleum shall be constructed to last as long as
possible, taking into consideration the technology and economics applicable to mausoleum
construction at the time of construction with construction materials reviewed by the board
under SPS 361.50 and s. 157.12 (2) (d) Stats.
CB 6.05. Mausoleum inspections. The board or its designee shall inspect a mausoleum
under SPS 361.41 and provide written notification of violations within 30 days after receiving
written notice from a cemetery authority that the construction or conversion of a mausoleum
has been completed, except as provided in s. 157.12 (2) (b), Stats., public mausoleum spaces
may not be sold prior to approval by the board or its designee.
SECTION 6. CB 6.05 (Note) is created to read:
Note. See Wis. Stat. § 440.70 for the definition of ‘Columbarium’” or “see subch. VII of
Wis. Stat. ch. 440 for information about columbaria and other matters relating to Crematory
Authorities.” See Wis. Stat. §157.061 (9) for the definition of “Mausoleum” and Wis. Stat.
§157.061 (14) for the definition of “Public Mausoleum”.
SECTION 7. EFFECTIVE DATE. The rules adopted in this order shall take effect on the first
day of the month following publication in the Wisconsin administrative register, pursuant to s.
227.22 (2) (intro.), Stats.
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(END OF TEXT OF RULE)
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13
STATE OF WISCONSIN DEPARTMENT OF ADMINISTRATION DOA-2049 (R03/2012)
DIVISION OF EXECUTIVE BUDGET AND FINANCE 101 EAST WILSON STREET, 10TH FLOOR
P.O. BOX 7864 MADISON, WI 53707-7864
FAX: (608) 267-0372
ADMINISTRATIVE RULES Fiscal Estimate & Economic Impact Analysis
1
1. Type of Estimate and Analysis
Original Updated Corrected
2. Administrative Rule Chapter, Title and Number
CB 1-5
3. Subject
Cemeteries, mausoleums, and cemetery burial records
4. Fund Sources Affected 5. Chapter 20, Stats. Appropriations Affected
GPR FED PRO PRS SEG SEG-S 20.165(1)(g)
6. Fiscal Effect of Implementing the Rule
No Fiscal Effect
Indeterminate
Increase Existing Revenues
Decrease Existing Revenues
Increase Costs
Could Absorb Within Agency’s Budget
Decrease Cost
7. The Rule Will Impact the Following (Check All That Apply)
State’s Economy
Local Government Units
Specific Businesses/Sectors
Public Utility Rate Payers
Small Businesses (if checked, complete Attachment A)
8. Would Implementation and Compliance Costs Be Greater Than $20 million?
Yes No
9. Policy Problem Addressed by the Rule
The rule creates a cemetery burial record and provides cemetery board guidance for the oversight of mausoleum
construction and inspections.
10. Summary of the businesses, business sectors, associations representing business, local governmental units, and individuals that may be affected by the proposed rule that were contacted for comments.
This rule was posted for economic comments for 14 days and none were received.
11. Identify the local governmental units that participated in the development of this EIA.
None. This does not affect local governmental units.
12. Summary of Rule’s Economic and Fiscal Impact on Specific Businesses, Business Sectors, Public Utility Rate Payers, Local Governmental Units and the State’s Economy as a Whole (Include Implementation and Compliance Costs Expected to be Incurred)
This rule will not have an economic impact on specific businesses, business sectors, public utility rate payers, local
governmental units or the state’s economy as a whole.
13. Benefits of Implementing the Rule and Alternative(s) to Implementing the Rule
The revision implements the requirements of 2015 Act 237 and creates a cemetery burial record and provides cemetery
board guidance for the oversight and inspection of mausoleums and mausoleum construction. The alternative of not
updating the rules will mean that the administrative rules will be outdated based upon statutory changes.
14. Long Range Implications of Implementing the Rule
The rule will comply with current statutory requirements.
15. Compare With Approaches Being Used by Federal Government
None.
16. Compare With Approaches Being Used by Neighboring States (Illinois, Iowa, Michigan and Minnesota)
Illinois: In 2010 the state of Illinois passed the cemetery oversight act. This act included provisions guiding cemetery
licensing, reporting, ethics, continuing education, and cemetery sales.
14
STATE OF WISCONSIN DEPARTMENT OF ADMINISTRATION DOA-2049 (R03/2012)
DIVISION OF EXECUTIVE BUDGET AND FINANCE 101 EAST WILSON STREET, 10TH FLOOR
P.O. BOX 7864 MADISON, WI 53707-7864
FAX: (608) 267-0372
ADMINISTRATIVE RULES Fiscal Estimate & Economic Impact Analysis
2
Iowa: All forms, certificates and reports pertaining to the registration of death events are the property of the Iowa
regulatory agency and are required to be surrendered to the state registrar upon demand. Under Iowa code 641- 97.17
and 641- 97.18 the funeral director is responsible for recording final disposition records.
Michigan: Cemeteries are required maintain accurate, complete, and legible records of any books, contracts, records, or
documents pertaining to, prepared in, or generated by, the cemetery operation including, but not limited to, forms,
reports, accounting records, ledgers, internal audit records, correspondence, and personnel records. All records are
required to be maintained for at least 7 years from the date of record completion.
Minnesota: Cemeteries are not licensed by the state of Minnesota but are governed by local units of government.
17. Contact Name 18. Contact Phone Number
Greg DiMiceli (608) 266-0955
This document can be made available in alternate formats to individuals with disabilities upon request.
15
STATE OF WISCONSIN DEPARTMENT OF ADMINISTRATION DOA-2049 (R03/2012)
DIVISION OF EXECUTIVE BUDGET AND FINANCE 101 EAST WILSON STREET, 10TH FLOOR
P.O. BOX 7864 MADISON, WI 53707-7864
FAX: (608) 267-0372
ADMINISTRATIVE RULES Fiscal Estimate & Economic Impact Analysis
3
ATTACHMENT A
1. Summary of Rule’s Economic and Fiscal Impact on Small Businesses (Separately for each Small Business Sector, Include
Implementation and Compliance Costs Expected to be Incurred)
2. Summary of the data sources used to measure the Rule’s impact on Small Businesses
3. Did the agency consider the following methods to reduce the impact of the Rule on Small Businesses?
Less Stringent Compliance or Reporting Requirements
Less Stringent Schedules or Deadlines for Compliance or Reporting
Consolidation or Simplification of Reporting Requirements
Establishment of performance standards in lieu of Design or Operational Standards
Exemption of Small Businesses from some or all requirements
Other, describe:
4. Describe the methods incorporated into the Rule that will reduce its impact on Small Businesses
5. Describe the Rule’s Enforcement Provisions
6. Did the Agency prepare a Cost Benefit Analysis (if Yes, attach to form)
Yes No
16
One East Main Street, Suite 401 • Madison, WI 53703-3382
(608) 266–1304 • Fax: (608) 266–3830 • Email: [email protected] http://legis.wisconsin.gov/lc/
WISCONSIN LEGISLATIVE COUNCIL RULES CLEARINGHOUSE
Scott Grosz
Clearinghouse Director
Margit S. Kelley
Clearinghouse Assistant Director
Terry C. Anderson
Legislative Council Director
Jessica Karls-Ruplinger
Legislative Council Deputy Director
CLEARINGHOUSE REPORT TO AGENCY
[THIS REPORT HAS BEEN PREPARED PURSUANT TO S. 227.15, STATS. THIS
IS A REPORT ON A RULE AS ORIGINALLY PROPOSED BY THE AGENCY; THE
REPORT MAY NOT REFLECT THE FINAL CONTENT OF THE RULE IN FINAL
DRAFT FORM AS IT WILL BE SUBMITTED TO THE LEGISLATURE. THIS
REPORT CONSTITUTES A REVIEW OF, BUT NOT APPROVAL OR DISAPPROVAL
OF, THE SUBSTANTIVE CONTENT AND TECHNICAL ACCURACY OF THE
RULE.]
CLEARINGHOUSE RULE 17-050
AN ORDER to renumber and amend CB 5.03 (3); to amend CB 2 (title); and to create CB 1.015
(2), 2.05, ch. CB 6, and 6.05 (Note), relating to mausoleums and burial records.
Submitted by CEMETERY BOARD
06-29-2017 RECEIVED BY LEGISLATIVE COUNCIL.
07-27-2017 REPORT SENT TO AGENCY.
MSK:MS
LCRC
FORM 2
17
Clearinghouse Rule No. 17-050
Form 2 – page 2
LEGISLATIVE COUNCIL RULES CLEARINGHOUSE REPORT
This rule has been reviewed by the Rules Clearinghouse. Based on that review, comments are
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18
COURT OF APPEALS
DECISION
DATED AND FILED
August 29, 2017
Diane M. Fremgen
Clerk of Court of Appeals
NOTICE
This opinion is subject to further editing. If
published, the official version will appear in
the bound volume of the Official Reports.
A party may file with the Supreme Court a
petition to review an adverse decision by the
Court of Appeals. See WIS. STAT. § 808.10
and RULE 809.62.
Appeal No. 2016AP1599 Cir. Ct. No. 2014CV1763
STATE OF WISCONSIN IN COURT OF APPEALS
DISTRICT II
E. GLENN PORTER, III AND HIGHLAND MEMORIAL PARK, INC.,
PLAINTIFFS-APPELLANTS,
V.
STATE OF WISCONSIN, DAVE ROSS AND
WISCONSIN FUNERAL DIRECTORS EXAMINING BOARD,
DEFENDANTS-RESPONDENTS.
APPEAL from an order of the circuit court for Waukesha County:
PATRICK C. HAUGHNEY, Judge. Affirmed.
Before Stark, P.J., Hruz and Seidl, JJ.
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No. 2016AP1599
2
¶1 STARK, P.J. In this appeal, E. Glenn Porter, III and Highland
Memorial Park, Inc.,1 contend two statutes, which the parties refer to as the “anti-
combination laws,” are facially unconstitutional on equal protection and
substantive due process grounds. Generally speaking, the anti-combination laws
prohibit the joint ownership or operation of a cemetery and a funeral home. The
State2 asserts the anti-combination laws survive rational basis scrutiny and are
therefore constitutionally permissible. Porter agrees the anti-combination laws are
subject to rational basis review; however, he urges us to apply a more stringent
form of rational basis scrutiny, sometimes referred to as “rational basis with bite.”
¶2 We conclude that, whether analyzed using traditional rational basis
scrutiny or a so-called “rational basis with bite” standard, the anti-combination
laws pass constitutional muster, in that Porter has failed to show beyond a
reasonable doubt they are not rationally related to a legitimate government
interest. We therefore affirm the circuit court’s order granting summary judgment
to the State.
BACKGROUND
¶3 For purposes of this case, the term “the anti-combination laws”
refers to WIS. STAT. §§ 157.067(2) and 445.12(6) (2015-16).3 Section 157.067(2)
provides:
1 We refer to the plaintiffs-appellants, collectively, as “Porter” throughout the remainder
of this opinion. We also refer to them individually where needed.
2 We refer to the defendants-respondents, collectively, as “the State.”
3 All references to the Wisconsin Statutes are to the 2015-16 version unless otherwise
noted.
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No cemetery authority may permit a funeral establishment to be located in the cemetery. No cemetery authority may have or permit an employee or agent of the cemetery to have any ownership, operation or other financial interest in a funeral establishment. Except as provided in sub. (2m), no cemetery authority or employee or agent of a cemetery may, directly or indirectly, receive or accept any commission, fee, remuneration or benefit of any kind from a funeral establishment or from an owner, employee or agent of a funeral establishment.
Section 445.12(6) provides:
No licensed funeral director or operator of a funeral establishment may operate a mortuary or funeral establishment that is located in a cemetery or that is financially, through an ownership or operation interest or otherwise, connected with a cemetery. No licensed funeral director or his or her employee may, directly or indirectly, receive or accept any commission, fee, remuneration or benefit of any kind from any cemetery, mausoleum or crematory or from any owner, employee or agent thereof in connection with the sale or transfer of any cemetery lot, outer burial container, burial privilege or cremation, nor act, directly or indirectly, as a broker or jobber of any cemetery property or interest therein.
¶4 Porter is the president and one of the principal owners of Highland
Memorial Park, a cemetery located in New Berlin, Wisconsin. Porter would like
to expand his business by operating a funeral establishment in conjunction with his
existing cemetery operations. However, the anti-combination laws prevent him
from doing so.
¶5 As a result, Porter filed this lawsuit, asserting the anti-combination
laws are facially unconstitutional on substantive due process and equal protection
grounds. In support of his substantive due process claim, Porter alleged the anti-
combination laws “arbitrarily and irrationally prevent cemetery operators from
owning an interest in a funeral establishment and owners and operators of funeral
establishments from having an ownership interest in a cemetery.” Porter further
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No. 2016AP1599
4
contended the laws infringe on his right to earn a living and do not further any
legitimate government interest.
¶6 Porter’s equal protection claim alleged the anti-combination laws
“create anticompetitive, irrational, and arbitrary distinctions between classes of
Wisconsin citizens,” in that only cemetery operators are prohibited from operating
or obtaining ownership interests in funeral establishments, and only funeral
directors are prohibited from obtaining ownership interests in cemeteries. Porter
alleged there is “no reasonable basis” for these classifications, and they serve “no
legitimate governmental purpose.” As relief, Porter sought: (1) a declaratory
judgment that the anti-combination laws violate equal protection and substantive
due process; (2) an order permanently enjoining the State from enforcing the anti-
combination laws; and (3) reasonable costs and attorney fees.
¶7 The State moved for summary judgment, arguing rational basis
scrutiny applied to both of Porter’s claims because he had not alleged the creation
of a suspect class or the violation of a fundamental right. The State asserted the
anti-combination laws survived rational basis review because they were rationally
related to three legitimate government interests—“preserving competition in the
death care services industry, protecting consumers from higher prices and poor
service, and reducing the potential for abuses from commingling of cemetery and
funeral revenues.” In support of its motion, the State submitted, among other
things, a report authored by economics professor Jeffrey Sundberg, who opined to
a reasonable degree of professional certainty that the anti-combination laws serve
the State’s claimed government interests. In response, Porter relied primarily on a
report and affidavit authored by economics professor David Harrington, who
opined to a reasonable degree of professional certainty that the anti-combination
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No. 2016AP1599
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laws do not actually advance the State’s claimed interests. Porter argued any
dispute as to that issue created a material question of fact requiring a trial.
¶8 The circuit court granted summary judgment in favor of the State.
The court concluded the anti-combination laws are constitutional because they are
rationally related to a number of legitimate government interests—namely,
“preserving competition, avoiding commingling of funds, preserving consumer
choices, avoiding higher prices, fostering personal service, [and] avoiding undue
pressure on consumers.” The court explained it was “satisfied … that if there are
arguments over whether some of this works or some of that doesn’t work, it stands
as proof then that there is a basis for the law.” The court emphasized it was “not
supposed to decide whether or not one type of law is better than the other, but only
whether or not there’s a rational basis for it.” Given the court’s determination
there was a rational basis for the anti-combination laws, it concluded it did not
“need to go beyond summary judgment and to have a trial on the matter, because
… there’s enough information before the court that the court finds the law is
constitutional.”
STANDARDS OF REVIEW
¶9 We independently review a grant of summary judgment, applying
the same standard as the circuit court. Hardy v. Hoefferle, 2007 WI App 264, ¶6,
306 Wis. 2d 513, 743 N.W.2d 843. Summary judgment is appropriate if “the
pleadings, depositions, answers to interrogatories, and admissions on file, together
with the affidavits, if any, show that there is no genuine issue as to any material
fact and that the moving party is entitled to a judgment as a matter of law.” WIS.
STAT. § 802.08(2).
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¶10 Porter raises a facial challenge to the constitutionality of the anti-
combination laws. “A facial constitutional challenge to a statute is an uphill
endeavor.” State v. Dennis H., 2002 WI 104, ¶5, 255 Wis. 2d 359, 647 N.W.2d
851. To succeed, Porter must demonstrate the anti-combination laws cannot be
constitutionally enforced under any circumstances. See Winnebago Cty. v.
Christopher S., 2016 WI 1, ¶34, 366 Wis. 2d 1, 878 N.W.2d 109, cert. denied sub
nom. Christopher S. v. Winnebago Cty., Wis., 136 S. Ct. 2464 (2016). The
constitutionality of a statute presents a question of law that we review
independently. Madison Teachers, Inc. v. Walker, 2014 WI 99, ¶13, 358 Wis. 2d
1, 851 N.W.2d 337.
¶11 In assessing Porter’s constitutional claims, we presume the anti-
combination laws are constitutional. See Blake v. Jossart, 2016 WI 57, ¶27, 370
Wis. 2d 1, 884 N.W.2d 484, cert. denied, 137 S. Ct. 669 (2017). To overcome this
presumption, Porter must demonstrate the laws are unconstitutional beyond a
reasonable doubt.4 Id. “It is not sufficient for the challenging party merely to
establish doubt about a statute’s constitutionality, and it is not enough to establish
that a statute probably is unconstitutional.” Id. (quoting Aicher ex rel. LaBarge v.
Wisconsin Patients Comp. Fund, 2000 WI 98, ¶19, 237 Wis. 2d 99, 613 N.W.2d
849). If there is any doubt regarding a statute’s constitutionality, we resolve that
doubt in favor of upholding the statute. Id.
4 Our supreme court has clarified that, although the “beyond a reasonable doubt” burden
of proof is reminiscent of the evidentiary burden of proof in criminal cases, “the constitutionality
of a statute is an issue of law, not fact.” Madison Teachers, Inc. v. Walker, 2014 WI 99, ¶13 n.8,
358 Wis. 2d 1, 851 N.W.2d 337 (quoting Ferdon ex rel. Petrucelli v. Wisconsin Patients Comp.
Fund, 2005 WI 125, ¶68 n.71, 284 Wis. 2d 573, 701 N.W.2d 440). “The beyond a reasonable
doubt burden of proof in a constitutional challenge case means that a court gives great deference
to the legislature, and a court’s degree of certainty about the unconstitutionality results from the
persuasive force of legal argument.” Id. (quoting Ferdon, 284 Wis. 2d 573, ¶68 n.71).
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No. 2016AP1599
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DISCUSSION
¶12 As noted above, Porter argues the anti-combination laws are
unconstitutional on two grounds. First, he contends the laws violate his
constitutional right to substantive due process. The right to substantive due
process is “rooted in the Fourteenth Amendment to the United States Constitution,
and Article I, Section 1 of the Wisconsin Constitution.”5 State v. Wood, 2010 WI
17, ¶17, 323 Wis. 2d 321, 780 N.W.2d 63. Substantive due process “addresses
‘the content of what government may do to people under the guise of the law.’”
Dane Cty. DHS v. Ponn P., 2005 WI 32, ¶19, 279 Wis. 2d 169, 694 N.W.2d 344
(quoting Reginald D. v. State, 193 Wis. 2d 299, 307, 533 N.W.2d 181 (1995)). It
protects against government action that shocks the conscience or interferes with
rights implicit in the concept of ordered liberty. Id. Stated differently, it protects
against state action that is “arbitrary, wrong or oppressive, regardless of whether
the procedures applied to implement the action were fair.” Id.
¶13 Second, Porter argues the anti-combination laws violate his
constitutional right to equal protection of the laws. See U.S. CONST. amend XIV,
§ 1; WIS. CONST. art. I, § 1.6 To demonstrate unconstitutionality on this basis,
5 Our supreme court has observed that the United States and Wisconsin Constitutions
“provide substantively similar due process guarantees.” Winnebago Cty. v. Christopher S., 2016
WI 1, ¶35 n.18, 366 Wis. 2d 1, 878 N.W.2d 109, cert. denied sub nom. Christopher S. v.
Winnebago Cty., Wis., 136 S. Ct. 2464 (2016). Accordingly, the court has, on multiple
occasions, declined to distinguish between the federal and state due process protections, and the
parties do not ask us to do so here. See id.; see also Blake v. Jossart, 2016 WI 57, ¶28 & n.15,
370 Wis. 2d 1, 884 N.W.2d 484, cert. denied, 137 S. Ct. 669 (2017); State v. Wood, 2010 WI 17,
¶17 n.9, 323 Wis. 2d 321, 780 N.W.2d 63.
6 As with the constitutional right to substantive due process, our supreme court “appli[es]
the same interpretation to the equal protection provisions of both the Wisconsin Constitution and
the federal constitution.” Aicher ex rel. LaBarge v. Wisconsin Patients Comp. Fund, 2000 WI
98, ¶55 n.14, 237 Wis. 2d 99, 613 N.W.2d 849.
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No. 2016AP1599
8
Porter must show that the anti-combination laws “treat[] members of similarly
situated classes differently.” See Blake, 370 Wis. 2d 1, ¶30. “The right to equal
protection does not require that such similarly situated classes be treated
identically, but rather requires that the distinction made in treatment have some
relevance to the purpose for which classification of the classes is made.” State v.
West, 2011 WI 83, ¶90, 336 Wis. 2d 578, 800 N.W.2d 929.
¶14 When a statute is challenged on substantive due process or equal
protection grounds, a court must first determine which level of judicial scrutiny to
apply. State v. Alger, 2015 WI 3, ¶39, 360 Wis. 2d 193, 858 N.W.2d 346.
“Whether reviewing substantive due process or equal protection, the threshold
question is whether a fundamental right is implicated or whether a suspect class[7]
is disadvantaged by the challenged legislation.” State v. Smith, 2010 WI 16, ¶12,
323 Wis. 2d 377, 780 N.W.2d 90. If a statute implicates a fundamental right or
disadvantages a suspect class, “the challenged legislation must survive strict
scrutiny.” Id. Under strict scrutiny, a law will be upheld only if it is narrowly
tailored to serve a compelling state interest. Alger, 360 Wis. 2d 193, ¶39.
¶15 If a challenged law does not implicate a fundamental right or
disadvantage a suspect class, courts generally apply rational basis scrutiny.8
7 The United States Supreme Court has stated a “suspect class is one ‘saddled with such
disabilities, or subjected to such a history of purposeful unequal treatment, or relegated to such a
position of political powerlessness as to command extraordinary protection from the majoritarian
political process.’” Massachusetts Bd. of Ret. v. Murgia, 427 U.S. 307, 313 (1976) (quoting San
Antonio Indep. Sch. Dist. v. Rodriguez, 411 U.S. 1, 28 (1973)). Examples of suspect classes
include classifications based on race or national origin. See id.
8 “A third level of scrutiny, intermediate scrutiny, … typically applies to ‘discriminatory
classifications based on sex or illegitimacy.’” Milwaukee Cty. v. Mary F.-R., 2013 WI 92, ¶35
n.22, 351 Wis. 2d 273, 839 N.W.2d 581 (quoting Clark v. Jeter, 486 U.S. 456, 461 (1988)).
Intermediate scrutiny is plainly inapplicable to Porter’s constitutional claims regarding the anti-
combination laws, and, as such, we do not address it further.
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No. 2016AP1599
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Smith, 323 Wis. 2d 377, ¶12. Under rational basis scrutiny, we will uphold a
challenged law unless it is patently arbitrary and bears no rational relationship to a
legitimate government interest. Id.
¶16 It is undisputed the anti-combination laws do not affect any
fundamental right or disadvantage a suspect class. Accordingly, the parties agree
we should analyze the laws’ constitutionality using rational basis scrutiny.
However, while agreeing in principle that rational basis scrutiny is appropriate, the
parties dispute how, precisely, rational basis scrutiny should be applied under the
specific circumstances of this case.
¶17 The State urges us to apply what we will refer to as “traditional”
rational basis scrutiny. In other words, the State argues our review is limited to
determining whether the anti-combination laws are rationally related to some
legitimate government interest. See id. The State emphasizes that, on traditional
rational basis review, a court must “identify or, if necessary, construct a rationale
supporting the legislature’s determination,” regardless of whether that rationale
actually influenced the legislature to pass the challenged law. Blake, 370 Wis. 2d
1, ¶32. The State also cites FCC v. Beach Communications, Inc., 508 U.S. 307,
315 (1993), in which the United States Supreme Court stated, “[L]egislative
choice is not subject to courtroom fact-finding and may be based on rational
speculation unsupported by evidence or empirical data.” The State further notes
the rational basis test “does not require the legislature to choose the best or wisest
means to achieve its goals. Deference to the means chosen is due even if the court
believes that the same goal could be achieved in a more effective manner.”
Ferdon ex rel. Petrucelli v. Wisconsin Patients Comp. Fund, 2005 WI 125, ¶76,
284 Wis. 2d 573, 701 N.W.2d 440 (footnotes omitted); see also Monarch
Beverage Co. v. Cook, 861 F.3d 678, 685 (7th Cir. 2017) (stating the United States
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Supreme Court has “never invalidated an economic regulation on rational-basis
review because a more direct or effective policy alternative was available”).
¶18 Applying these principles, the State argues on appeal that the anti-
combination laws satisfy rational basis scrutiny because they are conceivably
related to two legitimate government interests: protecting consumers from
increased prices, and limiting or minimizing the manipulation of funds required to
be held in trust by funeral directors and cemetery operators. The State asserts the
identification of these “conceivable, rational” bases for the anti-combination laws
should end our analysis.
¶19 Porter, in contrast, argues something more is required for the anti-
combination laws to satisfy rational basis review. Porter asserts, and the State
does not dispute, that the anti-combination laws were enacted decades ago at the
behest of the Wisconsin Funeral Directors and Embalmers Association. Porter
contends the laws were (and continue to be) a protectionist measure intended to
insulate funeral directors from competition by combination firms—i.e., firms
providing both funeral home and cemetery services. Because there is evidence
showing there was a protectionist motive for the enactment of the anti-
combination laws, Porter argues we must view the laws with a more skeptical eye.
Citing Ferdon, Porter asserts that, instead of simply asking whether the anti-
combination laws are rationally related to some legitimate government objective,
we must consider whether the laws have a “real and substantial relationship” to
such an objective. In other words, Porter argues the anti-combination laws survive
rational basis review only if the evidence shows the laws actually—not just
conceivably—advance a legitimate government interest. As Porter notes, this
evidence-based form of rational basis review is sometimes referred to as “rational
basis with teeth” or “rational basis with bite.” See Ferdon, 284 Wis. 2d 573, ¶78.
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¶20 Porter relies on several cases in support of his argument that we
should employ a “rational basis with bite” analysis in the instant case, rather than
the traditional rational basis analysis espoused by the State. Perhaps the most
persuasive of these cases are State ex rel. Grand Bazaar Liquors, Inc. v. City of
Milwaukee, 105 Wis. 2d 203, 313 N.W.2d 805 (1982), and Ferdon.9
¶21 At issue in Grand Bazaar Liquors was the constitutionality of a City
of Milwaukee ordinance establishing an eligibility requirement that an applicant
for a Class “A” liquor license—that is, a license to sell packaged beer and liquor to
be consumed off the premises—receive at least fifty percent of the applicant’s
income from the on-the-premises sale of intoxicants. Grand Bazaar Liquors, 105
Wis. 2d at 204, 205 n.3. The record showed the ordinance was enacted at the
behest of special interest groups “as an anticompetitive measure to keep large
retail stores out of the retail liquor business.” Id. at 209-10. However, during
litigation, the City raised two alternative purposes for the ordinance. Id. at 210.
Addressing these alternative purposes—which it did immediately after noting the
record supported the notion the ordinance was an anti-competitive measure
supported by special interest groups—our supreme court stated:
While this after-the-fact reasoning does not necessarily make it any less worthy of consideration because our review is focused on the reasonable person’s perspective of the ordinance regardless of testimony and evidence in the record, we cannot help but conclude in this case that “the Court should receive with some skepticism post hoc hypotheses about legislative purpose, unsupported by the legislative history.”
9 Porter also relies on a number of older cases, including John F. Jelke Co. v. Emery,
193 Wis. 311, 214 N.W. 369 (1927), and Dairy Queen of Wisconsin, Inc. v. McDowell, 260 Wis.
471, 51 N.W.2d 34 (1952).
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No. 2016AP1599
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Id. at 210-11 (quoting Schweiker v. Wilson, 450 U.S. 221, 244 (1981) (Powell, J.,
dissenting)). The court further explained that, while rational basis review prevents
a court from substituting its own notions of good public policy for those of the
legislative body that adopted a particular law, “this does not mean that our
evaluation is limited to form and not substance.” Id. at 209.
¶22 The Grand Bazaar Liquors court later quoted a secondary source
for the proposition that “the reasonableness of an ordinance is dependent upon
whether it tends to accomplish the objects for which the municipality exists. In
other words, to be reasonable, an ordinance must tend in some degree to
accomplish the object for which the municipal corporation was created and powers
conferred upon it.” Id. at 212 (quoting 5 MCQUILLIN, MUNICIPAL
CORPORATIONS, § 18.06, 347 (3d ed. 1969)). Applying this standard, the court
concluded the ordinance in question did not actually accomplish either of the two
purposes the City articulated during litigation—namely, limiting the number of
premises in the City licensed to sell intoxicants, and encouraging adherence to the
City’s liquor regulations. Id. at 210, 212. The court noted there was “no evidence
in the record to demonstrate … any public need to limit the number of new liquor
licenses,” nor was there evidence “regarding any public health, safety, morals, or
general welfare problem or concern with observance of the city of Milwaukee’s
laws.” Id. at 212-13. Based on this lack of evidence, the court concluded the
ordinance was not rationally related to either of the purposes the City advanced.
Id. at 212-14.
¶23 Porter argues Grand Bazaar Liquors is relevant to this case for two
reasons. First, Porter asserts Grand Bazaar Liquors demonstrates that, when the
record shows the actual motivation for a law was economic protectionism, we
must view alternative purposes for the law that are subsequently advanced during
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No. 2016AP1599
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litigation with a degree of skepticism. Second, Porter contends Grand Bazaar
Liquors shows that the “factual question” of whether a law actually furthers its
purported objectives is relevant in a proper rational basis analysis.
¶24 Porter also relies heavily on Ferdon. In Ferdon, our supreme court
considered the constitutionality of statutes limiting noneconomic damages in
medical malpractice cases to $350,000. Ferdon, 284 Wis. 2d 573, ¶8. The court
concluded rational basis was the appropriate level of scrutiny because the statutes
did not involve any fundamental right or suspect classification. Id., ¶¶65-66. The
court recited the traditional standard for rational basis review. Id., ¶73. However,
the court then stated, “For judicial review under rational basis to have any
meaning, there must be a meaningful level of scrutiny, a thoughtful examination of
not only the legislative purpose, but also the relationship between the legislation
and the purpose.” Id., ¶77. The court further explained:
The rational basis test is “not a toothless one.” “Rational basis with teeth,” sometimes referred to as “rational basis with bite,” focuses on the legislative means used to achieve the ends. This standard simply requires the court to conduct an inquiry to determine whether the legislation has more than a speculative tendency as the means for furthering a valid legislative purpose. “The State may not rely on a classification whose relationship to an asserted goal is so attenuated as to render the distinction arbitrary or irrational.”
Id., ¶78 (footnotes omitted).
¶25 The Ferdon court identified one overarching legislative objective for
the $350,000 cap on noneconomic damages, as well as five underlying objectives.
Id., ¶¶89-95. The court then addressed whether a rational relationship existed
between the cap and each of those identified objectives. In so doing, the court
analyzed extensive evidence provided by the parties—including government
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No. 2016AP1599
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reports, scientific studies, and testimony—and concluded that, in practice, the cap
did not actually further the identified government objectives. Id., ¶¶97-176. For
instance, the court concluded the cap was not rationally related to the objective of
ensuring quality health care by creating an environment that health care providers
are likely to move into because the “available evidence” indicated health care
providers “do not decide to practice in a particular state based on that state’s cap
on noneconomic damages.” Id., ¶171. Elsewhere, the court observed that while it
was plausible at first blush that a cap on damages would reduce health care costs,
id., ¶161, the evidence showed the correlation between such caps and a reduction
in health care costs was “at best indirect, weak, and remote.” Id., ¶166. Because
the evidence did not show that the challenged cap actually furthered the identified
government interests, the court concluded there was no rational basis for the cap.
Id., ¶¶184-87.
¶26 Porter asserts he has presented evidence that the anti-combination
laws do not actually further any of the State’s claimed government interests and, in
fact, operate contrary to some of those interests. Consequently, under the rational
basis with bite standard set forth in Ferdon, which Porter contends was also used
in Grand Bazaar Liquors, Porter argues there is at least a dispute of material fact
as to the constitutionality of the anti-combination laws. Accordingly, Porter
asserts the circuit court erred by granting summary judgment to the State.
¶27 In response, the State points out that no Wisconsin Supreme Court
case since Ferdon has employed the same sort of searching rational basis analysis
used in Ferdon when assessing a statute’s constitutionality on substantive due
process or equal protection grounds. See, e.g., Blake, 370 Wis. 2d 1; Madison
Teachers, 358 Wis. 2d 1; Northwest Airlines, Inc. v. DOR, 2006 WI 88, 293
Wis. 2d 202, 717 N.W.2d 280. However, Porter contends our supreme court did
32
No. 2016AP1599
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not employ a rational basis with bite analysis in cases like Blake, Madison
Teachers, and Northwest Airlines because the specific nature of the arguments,
issues, and factual records in those cases did not require such an analysis.
Moreover, in an opinion released after oral argument in this case, the court of
appeals followed the Ferdon court’s approach in concluding a $750,000 cap on
noneconomic damages in medical malpractice cases was facially unconstitutional.
Mayo v. Wisconsin Injured Patients & Families Comp. Fund, No. 2014AP2812,
slip op. recommended for publication ¶¶19-29 (WI App July 5, 2017). Our
opinion in Mayo undercuts the State’s argument that Ferdon is an outlier whose
methodology has not been repeated.
¶28 Both the parties and this court have devoted significant time and
attention to the issue of the proper way to apply rational basis scrutiny in the
instant case. However, we need not resolve the parties’ dispute regarding whether
the applicable level of scrutiny, here, is traditional rational basis review or rational
basis with bite. Ultimately, under either standard, we conclude as a matter of law
that the anti-combination laws are not unconstitutional on substantive due process
or equal protection grounds.10
10
Neither Porter nor the State draws a substantive distinction between Porter’s
arguments regarding substantive due process and equal protection. In addition, neither party
addresses the five-factor test Wisconsin courts have traditionally employed in equal protection
challenges to determine whether a legislative classification satisfies the rational basis test. See
Aicher, 237 Wis. 2d 99, ¶58. Instead, the parties appear to agree that both of Porter’s arguments
rise and fall on the question of whether the anti-combination laws are rationally related to a
legitimate government interest. This approach is consistent with State v. Smith, 2010 WI 16,
¶16, 323 Wis. 2d 377, 780 N.W.2d 90, in which our supreme court stated:
(continued)
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No. 2016AP1599
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¶29 In the following paragraphs, we first analyze the constitutionality of
the anti-combination laws using what we perceive as traditional rational basis
review. We then apply a rational basis with bite analysis.11
Finally, we address
Porter’s argument that a remand for further proceedings is necessary because
disputed issues of material fact precluded the circuit court from granting summary
judgment to the State.
I. Traditional rational basis review
¶30 As noted above, on rational basis review, our task is to determine
whether the anti-combination laws are rationally related to some legitimate
government interest. Smith, 323 Wis. 2d 377, ¶12. Under traditional rational
basis scrutiny, we are not concerned with the actual reasons the legislature passed
the anti-combination laws. See Madison Teachers, 358 Wis. 2d 1, ¶77 (describing
legislature’s actual motivations as “irrelevant” and stating that there need not be
evidence supporting a law’s rationality). Rather, the laws survive rational basis
review if we can conceive of any rational basis for them. See State v. Radke, 2003
WI 7, ¶27, 259 Wis. 2d 13, 657 N.W.2d 66. Our ultimate inquiry is whether the
Although substantive due process and equal protection may have
different implications, “[t]he analysis under both the due process
and equal protection clauses is largely the same.” Accordingly,
as a practical matter, the rational basis analysis applicable to [a
party’s] substantive due process challenge is also relevant to [the
party’s] equal protection challenge.
See also State v. Alger, 2015 WI 3, ¶49, 360 Wis. 2d 193, 858 N.W.2d 346 (resolving both equal
protection and substantive due process claims by determining whether the challenged state action
was rationally related to a legitimate government interest).
11 We recognize that Porter perceives there is but one rational basis review, not two
different types of analyses. Be that as it may, we dispose of Porter’s arguments in the course of
applying what we identify as the rational basis with bite analysis.
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legislature could have “rationally concluded” or “reasonably believed” that the
anti-combination laws would advance a legitimate government interest. See
Northwest Airlines, 293 Wis. 2d 202, ¶¶57, 59-61. Moreover, we presume the
anti-combination laws are constitutional, and to overcome that presumption Porter
must demonstrate their unconstitutionality beyond a reasonable doubt. See Blake,
370 Wis. 2d 1, ¶27.
¶31 On appeal, the State asserts the anti-combination laws are rationally
related to two legitimate government interests: protecting consumers from
increased prices, and limiting or minimizing the manipulation of funds required to
be held in trust by funeral directors and cemetery operators.12
With respect to the
first of these interests, the State contends that, without the anti-combination laws,
combination firms would, in the short run, offer lower prices than stand-alone
funeral homes and limit stand-alone firms’ access to cemeteries. The State asserts
this would drive stand-alone funeral homes from the market, at which point
combination firms would increase their prices. The State therefore contends that
allowing combination firms to operate in Wisconsin would ultimately increase the
price of death care services for Wisconsin consumers to their detriment.
¶32 As for its second claimed government interest—limiting the
manipulation of funds required to be held in trust—the State asserts that “different
types of sales within the death care industry are subject to different requirements
for holding in trust those funds paid for ‘pre-need’ purchase.” The State explains:
12
The State argued in the circuit court that the anti-combination laws were rationally
related to other legitimate government interests. However, the State has abandoned those
arguments on appeal, and we therefore do not address them. See A.O. Smith Corp. v. Allstate
Ins. Cos., 222 Wis. 2d 475, 491, 588 N.W.2d 285 (Ct. App. 1998).
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For example, caskets purchased pre-need are subject to a 100% trusting requirement, meaning all funds paid for a casket before death must be held in trust. See WIS. STAT. § 445.125(1)(a)1. Other merchandise, however, is subject to different trusting requirements: for example, “monuments, markers, nameplates, vases, and urns” are subject to a 40% trusting requirement. See WIS. STAT. § 440.92(3)(a), 157.061(3). And sales of cemetery plots require the seller to place in trust 15% of the principal paid for the plot, to cover perpetual care expenses. See WIS. STAT. § 157.11(9g)(c).
¶33 The State asserts the potential for abuse arises when a combination
firm sells both cemetery plots and other merchandise subject to higher trusting
requirements. The State contends that such a firm could “charge[] more for
merchandise that is subject to a lower trusting requirement, and lower[] its prices
for that merchandise which is subject to higher trusting requirements.” The State
asserts, “Doing so would give the firm immediate access to more funds, at the risk
that funds are not available when the pre-need purchaser dies and needs the paid-
for merchandise.”
¶34 Porter does not dispute—and we agree—that the State’s two claimed
bases for the anti-combination laws are legitimate government interests. Both
interests conceivably serve to protect consumers in markets encountered by
virtually everyone, and at a time in their lives when they may be particularly
vulnerable to questionable marketing influences due to the loss of loved ones.
Using a traditional rational basis analysis, we conclude the legislature could have
reasonably believed the anti-combination laws would advance both of the State’s
claimed interests. See Northwest Airlines, 293 Wis. 2d 202, ¶¶57, 59-61. It is of
no import that the legislature may actually have been motivated by other concerns
when it enacted the anti-combination laws, nor was the legislature required to cite
evidence supporting the laws’ rationality. See Madison Teachers, 358 Wis. 2d 1,
¶77. For purposes of traditional rational basis review, it is sufficient that the
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anti-combination laws conceivably advance the legitimate government interests
now relied upon by the State. Thus, under traditional rational basis review, Porter
has failed to demonstrate beyond a reasonable doubt that the anti-combination
laws are unconstitutional.13
II. Rational basis with bite
¶35 We similarly conclude, under a rational basis with bite analysis, that
Porter has failed to show the anti-combination laws are unconstitutional. As
discussed above, Porter contends that, under rational basis with bite, the anti-
combination laws are constitutional only if they bear a “real and substantial
relationship” to a legitimate government objective. Porter argues the anti-
combination laws do not meet this standard because an examination of the
materials submitted by the parties shows the laws do not, in fact, further any of the
State’s claimed interests.
¶36 In support of its argument that the anti-combination laws are
constitutional, the State relies primarily on the report of its expert witness,
economics professor Jeffrey Sundberg. Sundberg opined, to a reasonable degree
13
Porter asserts the anti-combination laws are not rationally related to the State’s first
claimed interest—protecting consumers from increased prices—because the type of exclusionary
behavior described by the State is already illegal under state and federal antitrust law. Porter
contends the legislature cannot rationally enact a statute to combat an evil that is already illegal.
We are not convinced the fact that some of the exclusionary conduct described by the
State may be illegal under other laws obviates the rational basis for the anti-combination laws.
Despite the existence of state and federal antitrust law, the legislature could have reasonably
deemed it prudent to enact additional measures aimed at specifically preventing exclusionary
conduct in the death care industry—an industry in which consumers are particularly vulnerable.
The legislature may also have reasonably wanted to prevent anti-competitive behavior by
combination firms that, while not rising to the level of an antitrust violation, could nevertheless
be detrimental to consumers.
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of professional certainty, that the anti-combination laws “protect the interest of
consumers” by “encourag[ing], or prevent[ing] the discouragement of,
competition.” Sundberg explained that combination firms, if permitted, would
“have an opportunity to significantly reduce the amount of competition they face”
through a process called “foreclosure.” According to Sundberg:
[A] cemetery with a financial interest in a funeral home could easily create an advantage by charging a normal or perhaps lower price for burials from its partner home, and a higher price for burials from other funeral homes. This would allow the combination to achieve a higher market share and create a disadvantage for rival firms, as long as the number of cemeteries was limited. This at least appears to be a consumer-friendly result, as long as it lasts. However, as the combination captures more market share, the amount of competition will decline and the firm can then charge full prices that include the artificially higher cost of the burial plot previously charged to other firms. Prices faced by consumers will rise.
¶37 Sundberg conceded foreclosure is “not a common result,” but he
asserted it is “most likely to work in a case where one part of the integrated firm is
a special resource, one that cannot easily be replicated by others.” Sundberg
opined, “This is likely to be the case with cemeteries,” because there are far fewer
cemeteries in the United States than funeral homes. Sundberg continued:
Given the land, capital, and regulatory requirements, it is reasonable to believe that entering the cemetery industry is much more difficult than starting a new funeral home.
As a result, a funeral home that is owned by, or owns, a cemetery has access to a scarce resource, one that gives it an advantage over other funeral homes. As other firms exit the market it becomes advantageous for the combination to use its market power to extract more money from consumers, perhaps by charging higher prices or perhaps by simply encouraging distraught consumers with few alternatives to add more features to their loved one’s service.
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The small number of cemeteries and the barriers to creating new ones, especially in urban areas, give a special advantage to well-capitalized large firms that can afford to purchase multiple funeral homes. With enough funeral homes, it may be profitable for a cemetery to completely exclude burials from funeral homes owned by others.
¶38 Porter relies on the contrary report and affidavit of his expert
witness, economist David Harrington. Harrington opined that the anti-
combination laws actually increase the cost of death care services to Wisconsin
consumers by, on average, $192 per death. Harrington explained it is less costly
to produce funeral services at combination firms because those firms are able to
benefit from economies of scale and scope. Harrington also disputed Sundberg’s
assertion that permitting combination firms would lead to foreclosure, ultimately
resulting in higher prices for Wisconsin consumers. He explained:
Perhaps the best evidence for this point is [the] fact that combination firms already exist and do business in almost all of the states. Although I have not deliberately investigated the possibility, I can say that over the many years I have studied the industry I have not seen any evidence that combination firms actually engage in the kind of exclusionary behavior that [Sundberg] says that he fears. If they did so, their conduct would likely have been the subject of a challenge under the antitrust laws. I am not aware that any such case has ever been brought in the states where combination firms are permitted to do business.
¶39 Porter argues Harrington’s opinions show that the anti-combination
laws do not, in fact, further the State’s claimed interest in protecting consumers
from increased prices. We disagree. Sundberg sharply disputed Harrington’s
assertion that the anti-combination laws increase the cost of death care services in
Wisconsin by $192 per death, raising several specific and reasonable criticisms of
Harrington’s methodology. In addition, although Harrington opined that, in his
experience, he has not seen any evidence that combination firms engage in
exclusionary behavior in the states where they are permitted, he conceded he has
39
No. 2016AP1599
22
not “deliberately investigated the possibility.” Moreover, even accepting as true
Harrington’s assertion that there is no evidence foreclosure and resultant price
increases have occurred in other states where combination firms are permitted,
there is similarly no evidence in the record establishing that those results do not
occur.14
On this record, Porter has not established, beyond a reasonable doubt,
that the anti-combination laws do not actually further the State’s claimed interest
in protecting consumers from increased prices.
¶40 As for the State’s second claimed governmental interest, Sundberg
opined that the anti-combination laws “reduce[] the potential for abuses from
comingling of cemetery and funeral revenues.” (Formatting altered.) Sundberg
explained:
[T]here is some potential for abuse when combinations exist. The amount of money set aside is supposed to be 15% of the value of [a cemetery] plot. By providing funeral services as well as cemetery plots, a firm could potentially exploit [the trusting requirement for cemetery plots] by increasing the price of something like burial vaults and reducing the price of the plot itself, collecting the same amount of revenue while being required to set aside less money for perpetual care, without actually reducing the actual expenses of perpetual care.
14
Sundberg noted in his affidavit that there is “no industrial organization literature that
specifically evaluates the possibility of foreclosure in the death services industry.” However,
Sundberg continued:
[A] very recent paper suggests that there are reasons to be
concerned about foreclosure in industries structured the same
way as the funeral homes industry. Loertscher and Reisinger use
a theoretical analysis to argue that while vertical integration
tends to be pro-competitive under most circumstances, it is likely
to be anti-competitive in cases where the integrating firm faces
many competitors, as is the case in the funeral homes industry at
the present time.
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Sundberg opined that having a single firm selling more categories of merchandise
“makes the commingling potentially easier to disguise, if a firm were interested in
doing so.” He asserted that, at a minimum, without the anti-combination laws,
“detecting such activity would be more difficult.”
¶41 Harrington disagreed with Sundberg’s conclusions regarding the
potential for abuse of trusting requirements. He opined:
Wisconsin has a state statute (WIS. STAT. § 157.11) designed to ensure that cemeteries are cared for in perpetuity. This statute applies to cemeteries operated by combination firms to the same extent that it applies to any cemetery. Abuse or misuse of funds is no more or less likely simply because a cemetery firms [sic] operates a funeral establishment. By defendant’s logic, a cemetery should be precluded from operating a flower shop because of the possibility that funds could be comingled. Wisconsin law does not prohibit cemeteries from engaging in the flower business or from selling any other complementary goods other than funeral services.
¶42 Again, Harrington’s opinion does not establish, beyond a reasonable
doubt, that the anti-combination laws do not actually advance the State’s interest
in limiting the potential for abuse of trusting requirements. While Harrington
asserted the abuse or misuse of funds is no more likely to occur in a combination
firm than a stand-alone firm, Sundberg offered a contrary opinion and further
opined, without contradiction, that having more categories of merchandise makes
the commingling of funds with different trusting requirements easier to disguise
and more difficult to detect. Sundberg also directly addressed Harrington’s point
that cemeteries are not prohibited from operating flower shops, noting, “While
such commingling could also occur with funds from flower sales, … funeral
revenues are likely to be much more significant than flower sales.”
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No. 2016AP1599
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¶43 Based on the expert opinions contained in Sundberg’s report, one
could reasonably conclude the anti-combination laws advance the State’s interest
in limiting the potential for abuse of trusting requirements. See Northwest
Airlines, 293 Wis. 2d 202, ¶57. Ultimately, while it is true the State has not
presented conclusive evidence showing the anti-combination laws actually limit
abuse of trusting requirements in practice, Porter has similarly failed to present
definitive evidence that the anti-combination laws do not have that effect. Stated
differently, Porter has failed to demonstrate, beyond a reasonable doubt, that the
laws do not actually serve the State’s interest in limiting the potential for abuse of
trusting requirements.
¶44 The principal cases Porter relies on in support of his argument that
the anti-combination laws do not satisfy rational basis with bite—Grand Bazaar
Liquors and Ferdon—are distinguishable. As discussed above, in Grand Bazaar
Liquors, the City of Milwaukee argued an ordinance requiring Class “A” liquor
license applicants to receive at least fifty percent of their income from the on-the-
premises sale of intoxicants was rationally related to the City’s interests in limiting
the number of premises in the City licensed to sell intoxicants and encouraging
adherence to liquor regulations. Grand Bazaar Liquors, 105 Wis. 2d at 204, 210.
Our supreme court disagreed, noting there was no evidence in the record of any
need to limit the number of new liquor licenses or evidence of any problem with
observance of the City’s liquor laws. Id. at 212-13. Here, in contrast, there is
evidence in the record—namely, Sundberg’s report and opinions—that the anti-
combination laws further the State’s claimed objectives. Unlike the Grand
Bazaar Liquors court, we are not faced with a complete lack of evidence
regarding the rational relation between the challenged laws and the government’s
claimed purposes.
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¶45 In Ferdon, our supreme court analyzed an extensive evidentiary
record in assessing whether a $350,000 cap on noneconomic damages in medical
malpractice cases furthered several government objectives. Ferdon, 284 Wis. 2d
573, ¶¶97-176. The court generally concluded the evidence supporting a rational
relationship between the cap and the government’s interests was weak, while the
plaintiff had presented significantly stronger evidence that the cap did not actually
further any of the government’s interests. See, e.g., id., ¶¶120-25, 144-158, 163-
66, 168-176.
¶46 In this case, each side has presented a single expert witness
supporting its position. The opinions of Sundberg, the State’s expert, support a
conclusion that the anti-combination laws advance the State’s interests in
protecting consumers from increased prices and limiting the potential for abuse of
trusting requirements. Although the opinions of Porter’s expert support a contrary
conclusion, they do not negate the rationality of Sundberg’s opinions or
definitively establish that the anti-combination laws do not actually advance the
State’s claimed interests. As a result, Porter’s expert’s opinions fail to rebut the
presumption the laws are constitutional. Thus, unlike the plaintiff in Ferdon,
Porter has failed to demonstrate the unconstitutionality of the anti-combination
laws beyond a reasonable doubt.
III. Necessity of a remand for further proceedings
¶47 Porter argues that, even if he has not definitively established that the
anti-combination laws are unconstitutional, he has, at the very least, raised a
genuine issue of material fact regarding the laws’ constitutionality. Porter
therefore contends the circuit court erred by granting the State’s summary
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26
judgment motion. Porter asks us to reverse the court’s order and remand for
further proceedings—presumably an evidentiary hearing.
¶48 We decline Porter’s invitation to remand this case for further
proceedings, as none are necessary. While evidence, including expert opinion,
has been presented in this case, the court must determine the relative merit of that
evidence during a constitutional challenge. Even under a rational basis “with bite”
analysis, neither the Ferdon court nor any authority Porter has cited stands for the
proposition that evidence bearing on a rational basis review is for some fact-finder
to determine. In addition to being unprecedented, allowing for a fact-finding
hearing would improperly elevate a so-called factual determination—presumably
one made under a mere preponderance-of-the-evidence standard—as dispositive of
the question of the anti-combination laws’ constitutionality—which determination
we know involves a more stringent standard that is a question of law. See
Madison Teachers, 358 Wis. 2d 1, ¶13.15
¶49 In sum, we presume the anti-combination laws are constitutional,
and in order to overcome that presumption, Porter must demonstrate the laws are
unconstitutional beyond a reasonable doubt. See Blake, 370 Wis. 2d 1, ¶27.
Under these circumstances, if the evidence indicates there is a reasonable
difference of opinion as to whether the anti-combination laws are rationally related
to the State’s claimed interests, then the State has prevailed because Porter cannot
meet his burden. The circuit court therefore properly granted summary judgment
to the State.
15
See also supra n.4.
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CONCLUSION
¶50 Under either traditional rational basis scrutiny or rational basis with
bite, Porter has failed to establish that the anti-combination laws are
unconstitutional beyond a reasonable doubt. We therefore affirm the circuit
court’s order granting summary judgment to the State.
¶51 We emphasize that our decision in this case does not express any
opinion as to the wisdom of the anti-combination laws or whether they are the best
way to accomplish the State’s legitimate interests in protecting consumers from
potential increased prices and limiting the possibility for abuse of trusting
requirements. The wisdom and efficacy of the anti-combination laws are issues
for the legislature, not this court, to decide. Rational basis review “does not ‘allow
us to substitute our personal notions of good public policy for those of’ the
legislature.” Id., ¶32 n.16 (quoting Schweiker v. Wilson, 450 U.S. 221, 234
(1981)). It is, instead, “a paradigm of judicial restraint.” Smith, 323 Wis. 2d 377,
¶17 (quoting Beach Commc’ns, 508 U.S. at 314). What is more, even if Porter’s
arguments caused us to doubt the anti-combination laws’ constitutionality, “it is
not enough to establish that a statute probably is unconstitutional.” Blake, 370
Wis. 2d 1, ¶27 (quoting Aicher, 237 Wis. 2d 99, ¶19). Here, for all of the reasons
discussed above, we conclude Porter has failed to show beyond a reasonable doubt
that the anti-combination laws are not rationally related to some legitimate
government interest. That conclusion ends our inquiry.
By the Court.—Order affirmed.
Recommended for publication in the official reports.
45
46