House committee substitute makes the following changes to the 1st edition.

Amends GS 90-210.23, Powers and duties of the Board, providing that the reinspection fee for funeral establishments or embalming facilities that fail to meet the article's requirements is to be based on the actual costs of reinspection, after considering the salary of any employees involved and any expenses incurred during the reinspection, but will not exceed $300 per reinspection (previously, no fee limit was included). Creates new GS 90-210.23(e2), which provides that if, after any inspection, a funeral establishment is found to have required documents that are not in compliance, the Board can charge a reinspection fee, which cannot exceed $25 per submission, to determine whether the documents are in compliance.

Amends GS 90-210.25, Licensing, making technical changes to statute citations and a typographical change.

Amends GS 90-210.25(a)(5)(a2), making technical changes.  Adds new criteria to established criteria that allows a licensee to practice funeral directing or funeral service without owning, being employed by, or being an agent of a licensed funeral establishment, to include (1) obtaining and maintaining professional liability insurance with limits of at least $1 million, with specified requirements for submitting proof of the insurance and notifying the Board of any change to such insurance and (2) providing funeral directing services to no more than two funeral establishments, with a requirement to submit identifying information of the establishments to the Board annually, with any changes due to the Board within 30 days of change.

Makes a clarifying change to GS 90-210.25(a)(5)(d)(5).

Creates new GS 90-210.25(a)(5)(d)(6), in regards to establishment permits, providing that a funeral establishment cannot contract or affiliate with more than two licensees which are permitted under GS 90-210.25(a2)(2). Also requires any funeral establishment that contracts with such a licensee to report specified information to the Board, with any changes to the submitted information due to the Board within 30 days of the change occurring.

Makes a clarifying change to GS 90-210.25(a)(5)(e)(p).

Amends GS 90-210.25(a)(5)(f), in regards to unlawful practices, providing that any person who knowingly or willfully abuses (previously, also included carelessly neglects), mutilates, or fails to treat with reasonable care (previously, also included concern) a dead human body in a person's custody will be guilty of a Class 2 misdemeanor.

Amends GS 90-210.27A, which allows the suspension of the requirements for preparation rooms in funeral establishments if the preparation room is damaged by fire, weather, or other natural disaster. Allows suspension for a period not to exceed 180 days (was, 90 days), provided the establishment complies with other specified requirements and laws. Establishes that in order to receive a suspension of more than 90 days, the applicant will have to show good cause for the additional time. Provides that, in regards to chapel registration, a registrant will have to, on or after January 1 for which the chapel is to be registered, pay a late fee in addition to the fee to register the chapel, if registration is not already paid.  Also establishes liability insurance requirements for funeral establishments, which must have limits of at least $1 million. Sets out other requirements regarding the maintaining of liability insurance.  Establishes that human remains must be stored in a licensed funeral establishment or licensed crematory when the remains are not in transit for visitation or funeral service.

Amends GS 90-210.28, Fees, establishing a Funeral Industry Practices document reinspection fee of $25.

Amends GS 90-210.29B, Exemptions from public records, providing that documents containing information collected or compiled by the Board or its inspectors or employees as a result of a complaint, investigation, audit, or interview in connection with a licensee, permitee, or registrant or any application (previously, only included licensee) for a license, permit, or registration is not considered public record until the Board has taken final action.

Amends GS 90-210.63(a)(4), providing that any funeral establishment holding a permit that accepts the transfer of a preneed funeral contract after the death of the contract beneficiary must file the certificate of performance with the Board and mail a copy to the contracting preneed licensee. Sets out requirements in cases where the funeral contract is performed in another state.

Amends GS 90-210.64(d), increasing the applicable preneed funeral fund balances to $1,000 or less (was, $500 in previous edition).

Amends GS 90-210.67, providing that a preneed sales licensee may sell preneed funeral contracts, prearrangement insurance policies, and make funded funeral prearrangements only on behalf of one preneed funeral establishment licensee; provided, however, the preneed sales licensee may also sell preneed funeral contracts or preneed insurance policies at any preneed establishment owned by the same corporation or at two or more preneed establishments owned by different individuals, corporations, or business entities located within a 30-mile radius.

Enacts new GS 90-210.68(a2), establishing that in January 2015, and each subsequent January, preneed licensees must prepare and submit an annual report to the Board on its preneed funeral contract sales and performance of preneed funeral contracts.

Deletes GS 90-210.69(c)(3), which previously established that a conviction involving a crime of fraud or moral turpitude could be used by the Board as a basis to refuse to issue or renew a license, or to suspend or revoke a license.

Amends GS 90-210.123, Licensing and inspection, providing that an owner of a cremation facility must be a licensed funeral director or funeral service licensee. Establishes that any crematory inspected and found to not meet all of the requirements of this Article must pay a reinspection fee for each additional inspection. Reinspection fee cannot exceed $300 per reinspection. Makes conforming and clarifying changes.

Enacts new GS 90-210.123(f1), providing that a crematory must sell or offer only cremation services, including the making of preneed cremation arrangements, or sell or offer containers, urns, and other cremation merchandise through a person licensed by the Board to practice funeral directing or funeral service who is an owner, employee, or agent of the crematory.

Amends GS 90-210.124(b), providing in what circumstances the director of social services becomes vested with all interests and rights to a dead body. Establishes that the director must authorize and arrange for disposition, including cremation, of the body.

Amends GS 90-210.129, providing that for any death occurring in North Carolina certified by the attending physician or other person authorized by law to sign a death certificate under the supervision of a physician, the body will not be cremated before the crematory licensee receives a death certificate signed by the person authorized to sign the death certificate. Provides exceptions to the prohibitions on cremating more than one person in the same cremation chamber.

Amends GS 90-210.132(a), making a clarifying change.

Amends GS 130A-415(a), exempting licensed funeral directors or funeral service licensees in North Carolina from the provisions of this subsection. Enacts new GS 130A-415(j), requiring funeral directors or funeral service licensees in North Carolina, with physical possession of a dead body, to make reasonable efforts to contact relatives of the deceased or other persons who might wish to claim the body for final disposition. Sets out procedures and responsibilities to follow if the body remains unclaimed. Makes conforming changes.

Enacts new GS 130A-420(b1), establishing that a person who does not exercise his or her right to dispose of the decedent's body under subsection (b) of this section within five days' notice or 10 days from the date of death, whichever is earlier, is deemed to have waived his or her right to authorize disposition of the decedent's body or to contest disposition. Sets out who retains authority of decedent's body in the case of a waiver occurring.

Effective December 1, 2013 (was, Section 15 effective January 1, 2015, with the remainder effective January 1, 2014).