The Howell-Nelson funeral homes in Mount Airy and Pilot Mountain have closed, and an official of a state regulatory board says steps are being taken to protect consumers with preneed funeral plans obtained from the operation.
Closings at both locations have occurred abruptly within the past week, accompanied by signs being posted to that effect at the Howell-Nelson sites on West Lebanon Street in Mount Airy and U.S. 52-Bypass in Pilot Mountain.
Ralph Howell, who is listed as funeral director and embalmer/owner of the operation, did not respond to a voice-mail message left on his cell phone Wednesday seeking comment about the circumstances surrounding the closings.
However, information obtained by The Mount Airy News revealed that this is coinciding with First Bank launching legal proceedings to take over the properties in Mount Airy and Pilot Mountain. Howell-Nelson is said to have defaulted on a $1.7 million loan obtained to build a dog training/crematory facility at the latter site.
The bank has approached other area funeral home officials about either assuming the loan or purchasing the operation’s three buildings in both communities, which so far reportedly have been unsuccessful.
A website listing for Howell-Nelson Funeral Service and Crematory shows that the last arrangements handled by the business were for a woman who died in early May.
The issue of how the Howell-Nelson closure will impact preneed contracts, entered into by persons making funeral arrangements in advance, is a concern due to earlier problems with such contracts which led to disciplinary action against the business.
It was disclosed in May 2018 that Howell-Nelson Funeral Service had been charged by the N.C. Board of Funeral Service, a state regulatory agency, with violations of laws and rules involving preneed funeral planning. This originated with customer complaints.
Collectively for the Mount Airy and Pilot Mountain locations, this included improper processing of preneed payments, pertinent records being unavailable for review along with additional paperwork shortcomings and the co-mingling of entrusted preneed funds with operating revenues, among other problems.
Both funeral homes’ preneed permits and all connected sales licenses were suspended for three years, but the state board issued a stay on the suspensions if certain conditions were met. They also were each fined $3,000.
The executive director of the N.C. Board of Funeral Service, Stephen E. Davis, said Wednesday that a process is in place aimed at ensuring those with existing preneed contracts from Howell-Nelson Funeral Service are safeguarded. He added that no recent consumer complaints about the operation have been made, on the heels of the preneed problems surfacing in earlier years.
Under such plans, money to pay for a funeral and/or burial is held in a trust using an escrow account or paid through an insurance policy on the life of the person covered by the plan.
An insurance company is the most frequent method used, according to Davis.
He said Wednesday that in any case where a licensed funeral home closes, “with notice or short notice,” the procedure involves a compliance team reviewing all records of the business to build an inventory of preneed contracts and other pertinent documents.
This seeks to ensure all records are intact and all funds accounted for, Davis said. “We have to have a full accounting of everything.”
There are believed to be no problems with unaccounted-for monies at Howell-Nelson Funeral Service, a local source familiar with the situation says.
Compliance field inspectors of the state regulatory agency routinely check funeral homes every three years to make sure records and revenues are in order, Davis said.
Once the compliance review is completed for the Howell-Nelson closure and a report issued — for which the board official could not suggest a time frame — the preneed contracts will be assigned to a “successor” funeral home in the area.
“We have not identified a successor firm” for Howell-Nelson, Davis said.
That firm will send letters to those with contracts informing them about the change and their options, which can include transferring a preneed contract to some other funeral home in the area. “So they have a choice,” Davis said.
He suggested that those with such plans should make sure their insurance premiums are paid and they also can contact the insurance carriers involved to help ensure a smooth transition.
Tom Joyce may be reached at 336-415-4693 or on Twitter @Me_Reporter.