A state agency has told the company that had been operating the embattled Mount Hope and Valley View cemeteries that it can't just quit.
Mid-America Growth and Development Corp. on Saturday decided to shutter Mount Hope in Belleville and Valley View in Edwardsville, according to landscaping maintenance employee Clyde Mager, who was told last weekend he and six other employees no longer had jobs at the cemeteries.
In a letter sent Wednesday to Mid-America and its attorney, a representative from the office of Illinois Comptroller Daniel Hynes wrote that Mid-America has to honor prepurchased burial contracts. An order from the comptroller that was included with the letter barred Mid-America from issuing new ones.
However, more than $300,000 is missing from more than 450 prepaid burial accounts at the two cemeteries, the comptroller reported last year. So it's not yet clear whether money is available for the burials. If a consumer's prepaid dollars are gone, the funds could be recovered later from a designated insurance fund, but the consumer likely would have to pay out-of-pocket for the funeral and be reimbursed later.
No one has been charged in connection with the missing funds. Illinois State Police have not confirmed whether they are investigating.
The letter from the comptroller's office said family members of 85-year-old Hillman Crowell, the president of Mid-America who died earlier this year in a car accident, closed the cemeteries because they are actually owned by another company, Forever Illinois Inc. Mager said Carol Horton, Crowell's daughter, had been running the cemeteries and told the staff she couldn't afford to operate them.
But because Mid-America holds the licenses to sell burials, the letter says, the company can't just give up on the people who purchased the services. Mid-America would have to terminate the state license to escape that responsibility. Even then, Mid-America could still be held accountable for what happened with the funds before the license was terminated.
Horton couldn't be reached for comment Thursday. But on Wednesday, before hanging up on a reporter, she said she was not operating the cemeteries, but rather making sure employees were paid.
The order sent from the comptroller Wednesday also demanded financial statements, an explanation of Crowell's estate plan, including the owner of Mid-America, and documents regarding the company's sales and entrustments.
The comptroller's office has started the process of revoking the Mid-America's license to sell prepaid services and putting the cemeteries under the control of a receiver. The cemeteries were last placed in receivership in 1997 after previous owner Larry Esterlen took money from the cemeteries' trust funds.
Property tax records show Forever Illinois, which owned the cemeteries before Mid-America bought them in 2005, had purchased the cemeteries back from Mid-America in June 2006. Crowell was required by law to notify the state of the sale, and he did not, Hynes spokeswoman Carol Knowles said. Before his death, Crowell maintained that he did not sell back the cemeteries.
Brent Cassity, the president of Forever Illinois, has not returned a reporter's calls.
Forever Illinois is affiliated with National Prearranged Services Inc., which is missing potentially millions of dollars in prepaid funeral accounts in several states and is now under the control of a receiver in Texas.
"Regardless of whether or not they transferred ownership of the cemetery, they still have a responsibility to the consumers who purchased preneed contracts," Knowles said of Mid-America. "Upon a consumer's death, it's Mid-America, not Forever, that has a duty to provide the goods and services detailed in the contracts."
Mid-America has seven days to respond to the letter from the comptroller's office. If the company doesn't respond, the comptroller will simply revoke Mid-America's license to sell prepaid burials.
In the meantime, Belleville and Edwardsville leaders are monitoring the cemeteries, and Edwardsville has said it may resume maintenance of the cemetery until a receiver is appointed.
Knowles warns consumers to not cease payment on their cemetery accounts, and she encourages those concerned about the status of their prepaid contracts to contact the comptroller's cemetery care hot line at (312) 814-3090 or (877) 203-3401.