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sr-042710-1h~® City C®uncil ep®rt City of Santa Monica City Council Meeting: April 27, 2010 Agenda Item: I F! To: Mayor and City Council. From: Lee E. Swain, Director of Public Works Subject: Cemetery Business Plan Amendment and Branding Recommended Action Staff recommends that the City Council approve an amendment to the Cemetery Business Plan and the related Resolution (Attachment A) to: 1) Apply for a mortuary license and offer mortuary services at the Woodlawn Cemetery; 2) Modify the name of the Woodlawn Cemetery to City of Santa Monica Woodlawn Cemetery, Mausoleum, and Mortuary; and 3) Approve a new logo for the Cemetery. Executive Summary On April 28, 2009, the City Council approved the Cemetery Business Plan designed to achieve financial sustainability through increased capacity at the Woodlawn Cemetery (Cemetery) by developing additional interment space (graves, crypts, and cremation niches) for sale, implementing a marketing plan, and restructuring pricing for services. In order to implement the Business Plan as approved by Council, staff sought additional Council approvals on November 10. 2009 to eliminate the residency requirement for the Cemetery and on December 18. 2009 to vacate excess public right-of-way within the Cemetery to increase capacity. With these subsequent approvals, staff implemented the Cemetery Business Plan in January 2010. This amendment and the related Resolution (Attachment A) help to achieve the objectives set forth in the original Plan through offering additional services and branding. Background As part of the implementation of the Cemetery Business Plan, staff is continually seeking ways to enhance the level of care provided to the community, to provide additional services to the public, and to improve the marketability of the Cemetery in an ongoing effort to achieve financial sustainability. 1 The establishment of a mortuary at the Cemetery is requested as means to provide the community with additional services and to make the Cemetery more competitive with surrounding cemeteries that already offer mortuary services The name modification is requested so that the Cemetery can distinguish itself from other similarly named cemeteries in the area. The proposed name will identify the Cemetery as a City-owned facility and part of the City's panoply of services offered to the community. Discussion Mortuary Services Program There are numerous differences between cemetery services and mortuary services. Cemetery services include the operation of a cemetery. Operation of the facilities includes maintenance of the grounds, development of interment space and mapping, and the maintenance of records related to interments. Goods and services offered by a cemetery include the sale of interment spaces, products (e.g. urns, vaults; and flowers), and the excavation of graves to accommodate burials. Mortuary services include the transportation, storage, and care of the deceased including .embalming, cosmetics, casketing, and cremation. Additionally, planning funeral ceremonies, filing death certificates, and conferring with the coroner and other officials are included in mortuary services. At present, the Cemetery offers only cemetery services to the community. Families the Cemetery currently serves often request mortuary services. All of the Cemetery's major competitors (Attachment B) offer mortuary services. This places the Cemetery at a significant disadvantage in marketing services. Cemeteries that offer mortuary services have proven to be successful as they afford clientele the convenience of making all necessary arrangements at one location. Clients appreciate the ability to work with the same establishment to handle all of their 2 needs versus having to deal with different people at various locations during a stressful and emotional time. The additional revenues generated from providing mortuary services will assist the Cemetery in achieving financial sustainability. The recent economic crisis has negatively impacted revenue at the Cemetery, particularly in the volume of pre-need sales, specifically purchases. of an interment space before death. Pre-need sales have historically accounted for nearly half of all sales while at-need sales, a purchase related to a death, were just over half of all sales. The Cemetery Business Plan is geared towards maintaining a sales split as close to 50 percent as possible to maintain financial sustainability. Currently at-need sales are approximately 74 percent of total sales, while-pre-need sales have dipped to a low 26 percent of total sales during this fiscal year. The decline of pre-need sales is expected to continue until the economy improves. Implementing a Mortuary Services Program at the Cemetery does not require hiring additional staff. Arrangement of full-range funeral services can be made during one meeting with families in need. The staff person that currently meets with families to conduct the cemetery portion of the arrangement and sales appointment would be the same person who handles mortuary-related issues. Transportation, preparation, and cremation of the deceased would be provided through service contracts. Installing a crematory on site and hiring additional staff to operate the crematory and transport and care for the deceased can be explored in the future. Overall, this Mortuary Services Program is cost effective while providing simplicity and maximum care to families during an extremely emotional. time. 3 Implementation The following two service contracts, which staff will obtain through the issuance of a Request for Proposals, are necessary to implement a Mortuary Services Program at the Cemetery: 1) Transportation and Crematory Service Contract This service is for the transportation of the deceased from their place of death to the mortuary holding facility on site at the Cemetery for either cremation or burial. It also includes the procurement of the death certificate from the attending physician or coroner, the transportation of the remains to the crematory, and the cremation of the remains. 2) Preparation and Care of Deceased Service Contract This service is for the necessary care and preparation of the deceased including embalming; dressing, and casketing of the deceased. The average cost of funeral service is $6,000 in the Los Angeles area. Staff set the Cemetery prices (Exhibit 1 of Attachment A) based on this area and sought opinion from the City Attorney's Office oh the appropriateness of the methodology. The City Attorney's Office agrees that this is one appropriate method of establishing the charge for funeral services. Staff projects the program to generate approximately $792,000 during FY2010-11, the first year of implementation, and increase revenues steadily in subsequent years (Attachment C). This is based on the number and a survey of at-need families the Cemetery currently serves each year. The cost to implement a Mortuary Services Program is approximately $155,779 and consists of the following: 4 Description Modification of the existing maintenance building at the Cemetery to create a preparation and holding facility Essential equipment for the care and preparation of the deceased State license application fee Total Cost: Associated Cost $133,196 $22,183 $400 $155,779 The California Department of Consumer Affairs Cemetery and Funeral Bureau (DCA) licenses all funeral establishments in the State. To implement a Mortuary Services Program, the Cemetery will have to apply for licensure with DCA as a funeral establishment and comply with the following requirements: • Submit application to DCA The application requires that four senior officers of the City be designated and listed on the application as follows: City Manager as President, Assistant City Manager as Vice President, Director of Finance as Treasurer, and City Clerk. as Secretary. Each of these individuals needs to be Live Scan fingerprinted. In addition, the City's Cemetery Administrator will be designated on the application as the Mortuary Manager for which. a licensed funeral director is required. • Allow DCA to inspect room as suitable for storaoe of human remains A preparation room needs to be furnished with sanitary flooring, necessary drainage, and cooling ventilation. It also needs to contain necessary instruments and supplies for the preparation, sanitation, or embalming of human remains for burial or transportation. The facility has to pass inspection by DCA prior to license issuance. Once the application is received by DCA, it takes approximately 45 days before the license is issued and mortuary services can be offered. 5 Name Modification and Logo Modifying the name of the Cemetery will help with branding and raising the Cemetery's profile. Currently the Cemetery is frequently mistaken for another privately-owned cemetery in the region with the same name. To distinguish the Cemetery and help with marketing efforts, staff recommends modifying the name to "City of Santa Monica Woodtawn Cemetery, Mausoleum, and Mortuary." This modification is crucial to the Cemetery's sales and marketing strategy as it will: 1) Identify the Cemetery as being located in Santa Monica; 2) Convey the Cemetery's association with the City, which is considered to be a positive factor among potential clients; and 3) Inform consumers that the Cemetery offers mausoleum and mortuary services. While the City's name is considered to be a positive association, using the City's brightly colored bay logo to define the Cemetery presents a unique challenge as most visits to the Cemetery are for a somber occasion. The use of program logos in certain limited circumstances when special needs require an application that does not conform to the guidelines on the use of City logo is allowable, per the City's identity guidelines. For example, certain revenue-generating programs, or programs that are the result of a partnership between various agencies, have been granted permission to use a special program logo in connection with the City logo. Given the nature of the Cemetery's core services and the need to have an identity that complements these services, the Cemetery began to explore unique logo and branding elements. In the fall of 2009 staff collaborated with students from the Los Angeles Art Institute to develop preliminary ideas for a new logo. The graphic design firm Heavenspot was retained in February 2010 to further develop and refine the student logo. The proposed logo (Attachment D) for the Cemetery is a depiction of a stained glass magnolia tree set in an arched window frame. The image of the tree itself represents the lush landscape of the Cemetery and highlights the majestic magnolia trees that greet the visitors at the entrance. The stained glass detailing and window frame are reminiscent of the Mausoleum's magnificent stained glass windows. An element of the City logo is 6 incorporated to communicate and reinforce that the Cemetery is part of the City of Santa Monica's panoply of community services. The proposed logo preserves key elements of the original student design that make it unique to the City of Santa Monica and the Cemetery. Financial Impacts & Budget Actions One-time start-up costs of $155,779 to implement the Mortuary Services Program are available in CIP account 374047.589000. Ongoing operating revenue and expenditure assumptions will be included in the FY2010-11 budget. Budget authority for subsequent years will be requested in each annual budget cycle for Council approval. Prepared by: Virgil County, Cemetery Administrator Approved: -~{ L E. ain Director of Public Works Forwarded to Council: ----- Rod Gould City Manager Attachments: A -Resolution B -Cemetery Competitors C -Projected Mortuary Revenue D -Cemetery Logo 7 ATTACHMENT B WOODLAWN CEMETERY COMPETITORS B- Pierce Brothers Westwood Village Memorial Park & Mortuary (Westwood) C- Hillside Memorial Park & Mortuary (Culver City) D- Holy Cross Cemetery & Mortuary (Culver City) E- Angelus/Rosedale Cemetery (Los Angeles) F- Inglewood Park Cemetery & Mortuary (Inglewood) G- Hollywood Forever Cemetery & Mortuary (Hollywood) H- Forest Lawn Memorial Parks & Mortuaries (Los Angeles) ATTACHMENT C Five-Year Mortuary Services Revenue Projections* FY2010-11 FY2011-12 FY 2012-13 FY2013-14 FY2014-15 $792,000 $831,600 $873,180 $916,837 $962,680 *5% annual escalator combination of CPI and projected growth through advertising. ATTACHMENT D Proposed Cemetery Logo Cass srt ~atota Mas~iw ~~~ G~m'dcsY • MatsaQle~sss ~i#arsvvy Reference Resolution No. 10468 (CCS).