Grave Questions: Cemeteries Fight for Life
Colorado Springs Gazette, 22 February 2009, page Business 1
Cemeteries Fight for Life
City Mulls Alliances to Offset Loss from Burial Decrease
By Bill McKeown
Burial is quickly becoming a quaint anachronism in the Pikes Peak region, and that has raised the possibility that the city’s two historical cemeteries could close to new burials long before they run out of land.
The decline in the popularity of traditional burials also threatens to reduce the size of a 106-year-old endowment fund meant to maintain Evergreen and Fairview cemeteries in perpetuity after they close to new burials.
That prospect has spurred an unusual bid solicitation from the city. It is advertising nationally for interest in potential business alliances with private industry that would grow profits at Evergreen and Fairview cemeteries, which as city enterprises must be operated not on tax dollars but on revenue they generate.
Death, of course, remains a going concern in El Paso County: About 3,400 residents on average die each year, a figure that has slowly but steadily increased as the county has grown, according to state statistics.
The problem confronting the cemeteries: An increasing number of people, especially in the West, are being cremated, not buried. That trend is even greater in El Paso County, which cemetery manager Will DeBoer says has one of the highest cremation rates in the nation.
In fact, in 2007, the last year for which statistics are available, 63 percent of the 3,345 people who died in the county were cremated. And the cremains of only 10 percent of those people come to Evergreen and Fairview cemeteries.
About 15 percent of those cremated, DeBoer estimated, have their ashes scattered outdoors or kept in a relative’s home. Some ashes are even abandoned at funeral homes. Many others choose to have their ashes kept in private funeral home and church columbariums, vaults lined with recesses for urns of cremated remains, called cremains.
Another potential threat exists for the cemeteries — the possible creation of a nearby national cemetery offering free burial for veterans. A committee has been studying locations convenient to Colorado Springs, and if lawmakers find money for a national cemetery in the area, DeBoer said the city’s cemeteries could lose a third of their business.
All those trends bode ill for a business built on burials.
“We sell a product no one wants to buy,” DeBoer said. “Our business is flat, and for any business to be successful — and this is a business — it has to make money.”
The city has kept a pretty good market share in its traditional business, garnering about 53 percent of all burials in the county. The trouble is that those 700 or so burials each year are just covering the cost of maintaining the cemeteries, and paying the salaries and benefits of their 11 employees, about $1.4 million annually. As those costs continue to rise in coming years — water, for example, rose from $37,710 in 2003 to $115,000 in 2007 — the price of burial services will need to rise.
In 2007, for example, the price of a burial plot rose from $695 to $800. Although that price is still among the lowest on the Front Range, DeBoer fears that unless new revenue sources are found, burial prices will rise until they become noncompetitive. That, combined with fewer burials to cover ever-rising costs, would force the cemeteries to close to new burials.
When that happens, an endowment created in 1903 and funded by 15 percent of a burial’s cost will be used to maintain the cemeteries. But that fund, reduced from $9 million to about $7.5 million by the recent collapse in the stock market, may not be enough if burials continue to decline.
The solicitation of ideas for expanding revenue is the result of a request from City Council about six months ago that the enterprise come up with a “business plan,” said Councilman Larry Small.
“We told them ‘You can’t really do it yourself — you can’t afford to hire people,’” Small said. “They need to find some professionals who might be able to help, who will work on commission or a fee arrangement to put a marketing program in place and bring in preneed revenues. That’s where others are making money.”
DeBoer agreed he doesn’t have the staff to pre-sell burial or cremation services. He, too, hopes someone in the private sector will propose a profitsharing way of capturing that business. But he said that market, at any one time, tends to be limited, so he’s hoping for some additional ideas on ways to make money.
The single biggest potential for more revenue, he said, is capitalizing on cremation. He said Evergreen has three columbariums and Fairview one, but neither cemetery has a crematory. He said that means many relatives prefer to go to a funeral home, which can cremate bodies, sell urns and plaques and store the remains in their own columbariums. He said the city’s biggest competitor, Memorial Gardens Cemetery, has a funeral home, a crematory, columbariums and a monument business onsite, which makes it difficult to compete.
“Quite honestly, there’s onestop shopping at Memorial Gardens,” he said. “Boomers like convenience. If they come to us, they have to deal with a cemetery, a funeral home and a monument company.”
Among other revenue-producing ideas DeBoer would like to explore with private industry are:
Green burials: a small but growing trend in which bodies are buried in bags, wicker baskets or egg-carton boxes, ofiering customers lower costs and fewer environmental consequences. The city’s costs also would decline because the plots would not be watered.
Estate sales: a small but lucrative market in which land is sold to families to build monuments, sculptures, crypts, walls, benches and gates. Some cemeteries charge up to $200,000 for a family plot.
Sale of assets: Evergreen has 1 acre on its eastern border and 22 acres on its western border that could be sold. However, since 1,200 to 1,300 bodies can be buried on one acre, the sale of the parcels would reduce the usable life span of Evergreen.
Management of the enterprise: DeBoer said the city will entertain the notion that a private company would take over day-to-day management of the cemeteries on a fee basis.
DeBoer said the solicitation for sealed bids does not end until the end of February so he does not know whether any bids have yet been submitted.
One seemingly likely candidate, Costas Rombocos, owner of nearby Shrine of Remembrance Funeral Home, said he won’t submit a bid.
Neither will the single biggest player in the death-care industry nationwide, Service Corporation International, which owns five funeral homes locally and Memorial Gardens Cemetery, a spokeswoman said.
DeBoer said a similar bid proposal was floated years ago and failed to generate interest. He hopes this one will, but he said there are obstacles to forging alliances with private industry.
“It’s hard to get into a market where maximum profits already are being taken by the private sector,” he said. “There’s only one dollar, and if we want to get more of that dollar, it has to come from the private sector. That’s where it’s difficult being a government business.”
In 2007,the last year for which statistics are available, 63 percent of the 3,345 people who died in the county were cremated.
The jewel of the city’s cemetery enterprise, Evergreen Cemetery, was established shortly after the city was founded in 1871, although evidence of burials as early as 1860 have been found on the land off Hancock Avenue. It was deeded to the city in 1875 by town founder Gen. William Palmer. It contains the remains of more than 80,000 people.
Twenty years later, Fairview Cemetery was established in Colorado City near 26th Street, and Colorado Springs assumed ownership when the small city was annexed in 1917.