Business

Funeral home feud reaches Taos

By Cody Hooks
chooks@taosnews.com
Posted 9/20/18

Besides hosting funerals for Taos families, a trio of companies have marketed themselves so aggressively that the free-market battle has erupted beyond local media advertising...

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Business

Funeral home feud reaches Taos

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If any business is promised a steady stream of customers, it's a funeral home.

For many years, Rivera Family Funeral Home has been the only such business in Taos, but two competitors are trying to change that.

Riverside Funeral Home started in Belen while the other competitor, DeVargas Funeral Home, originated in Española and is now owned by a publicly traded company in Canada. Both are working to open their own funeral homes in Taos -- on the same side of road as Rivera and all within a mile and a half of each other.

The tone of the feud is, notably, not serene.

Besides hosting funerals for Taos families, the trio of companies have marketed themselves so aggressively that the free-market battle has erupted beyond local media advertising, including in The Taos News, and into lawsuits aimed at sussing out which businesses count as local in Northern New Mexico.

Lawsuits

As the saying goes, funerals are for the living, not the dead. That's why solid relationships and a good reputation are essential across the industry but especially in a small town like Taos.

"We've been working with generations of families," said Tim Rivera, owner of Taos' only funeral home.

Rivera's father ran a funeral home in Pueblo, Colorado but sold that enterprise before moving to Taos and relaunching the family business with the purchase of a local facility in the early 1980s. Rivera has been in the business ever since.

Despite that background, his claim to being the only locally owned and operated outfit became the center of a lawsuit brought against him by SMI-ABQ Assets, the company that owns the DeVargas Funeral Home and Crematory. The suit, filed in district court in Santa Fe, claims Rivera peddled "false and misleading facts" that are detrimental to the DeVargas brand.

Last year, owner Johnny DeVargas sold his funeral business to The Signature Group, a Delaware company licensed to do business in New Mexico but headquartered in Houston, Texas. The company acquired an Albuquerque funeral business in 2012 "as a sturdy foundation on which to build" and bought several other funeral homes in New Mexico before purchasing the DeVargas Funeral Home in June 2017, according to its website.

Rivera ran an advertisement in the Rio Grande Sun in July 2017 congratulating DeVargas for his "retirement," noting the sale of his funeral home to a "chain" and pitching itself as "Española's only locally and family owned and operated funeral home," according to the lawsuit brought against Rivera and his companies.

The suit, filed in district court in Sept. 2017, also cites a Taos News "Success Story," which is a paid advertisement, as an example of "falsity and hypocrisy," given Rivera is from Colorado and has also expanded his brand in Northern New Mexico. Rivera owns funeral homes in Taos, Santa Fe and Española.

"Signature (Group) is no more a large conglomerate funeral home chain than Rivera, with each company being comprised of relatively small, out-of-state ownership groups that have bought into the New Mexico funeral service market," the lawsuit states.

In October 2017, Rivera countersued the company built on "aggressive growth and acquisition," he said.

Since then, the Park Lawn Corp., which is headquartered in Canada, bought Signature Group for approximately $123 million. The May 2018 acquisition brought the number of cemeteries, funeral homes and related businesses in Park Lawn's portfolio to 139 across the U.S. and Canada.

The expansion is lucrative. According to the company's financial reports, Park Lawn Corp. saw $40 million in revenue in the second quarter of 2018 -- a 100 percent increase in revenue over the same period last year. Funeral services are a multi-billion dollar industry that analysts expect to keep growing at an unprecedented rate. and the number of death per year in the U.S. has increased by 35 percent in the last 35 years, according to stock analysts Raymond James.

However, Rivera is not the only funeral business to face a lawsuit from the DeVargas parent company.

In Aug. of 2017, SMI-ABQ Assets and its chief operating officer Jay Dodds also sued Charles Finegan and his business, Riverside Funeral Home, for defamation. That suit, like the one against Rivera, says that all of its funeral homes "are locally operated and staffed by native New Mexicans with decades of experience serving their respective communities in the funeral profession."

Over the last year, that lawsuit has moved through the court system; a district judge ordered the DeVargas parent corporation to turn over documents.

The fight between Finegan and SMI-ABQ Assets is even bloodier than the Taos tug-of-war. Finegan said that fight "stems way back" to when the two executives worked together decades ago.

An anonymous website excerpts some of Finegan's Facebook posts slamming everyone from the Hispanic community to incarcerated people, which Finegan said were "basically my opinion on a few things." He said the website is meant to "make the public have a bad opinion of me."

Rivera feels his business is essentially "collateral damage" in an unprofessional "war" between the two other companies, he said.

The Taos News called Park Lawn Corp. for comment on this story but was directed to the Signature Group. Phone messages left with Mark Shalz, the New Mexico executive for the DeVargas parent company who is listed on a permit application at the Taos County Planning Department, were not returned.

Making inroads in Taos

The Riverside and DeVargas funeral homes have continued closing in on the Taos market.

Over several months this year, DeVargas ran advertisements showing plans for a future funeral home on the south side of Taos.

"Personally knowing the families of Taos, we understand quality service and affordability are both very important. We also know people are more comfortable when they have a choice. You now have a choice," the DeVargas advertisement read.

Over the past 18 months, the DeVargas business has served Taos County families out of its Española office, according to Joaquin Gonzales, a lifelong Taoseño and DeVargas employee who will be the manager of the Taos location.

"We want to give Taos professional, compassionate and, most importantly, an affordable choice in funeral services," said Gonzales, who worked for Rivera for many years. Instead of shying away from DeVargas' ownership by Park Lawn Corp., Gonzales says he feels privileged to work for a company that is able to finance a "multi-million dollar facility in Taos."

DeVargas Funeral Home took it's application for the new facility to the Taos County Planning Commission Sept. 12. That application called for rehabilitating the dilapidated Lujan's Funeral Home, located just south of the Sagebrush Inn on Paseo del Pueblo Sur. The board unanimously approved the application.

Gonzales said they hope to break ground on the DeVargas Funeral Home of Taos in the coming weeks. The facility will have to pass inspection by the state funeral board.

Yet Riverside has also remained steadfast in its march into the Taos market.

According to Finegan, his company is "coming to Taos five to six times a week." Finegan said business has been "very good."

Regardless of newspaper advertisements being the basis of the lawsuit against him, Finegan has run many in The Taos News since last year touting his company's lower prices and his employees are who are Taoseños. "Keep your hard-earned money local and quit over-paying," an advertisement from June read.

Riverside advertises a basic funeral for about $3,000 and a cremation for $745. Rivera told The Taos News his company offers a basic burial package for $2,795 and cremation for $699, but noted that with additional services, the cost can be between $3,900 and $7,000. At DeVargas, a traditional burial is $3,995 and direct cremation costs $1,295, according to Gonzales, who said his company will "match or beat any other funeral homes prices without sacrificing quality."

Outside of pricing funerals, Rivera noted how funeral companies are basically "financial institutions" in a local community. "Because so many of our families have prepaid their cremation and burial plans, it is vital that a funeral home have pricing that is sustainable for the future. In the last 15 years, Taos has had four funeral homes go (out of business) that all aggressively advertised low prices and then left Taoseños high and dry for (thousands of dollars) on low-cost prepaid funeral plans."

Riverside sidelined

Riverside Funeral Homes, a company based out of Los Lunas with three properties in the state, took its application to open a funeral home before the Taos Planning and Zoning Commission during the Sept. 5 meeting.

Finegan's plan is to renovate a shuttered restaurant, the former Earlene's Cafe on Paseo del Pueblo Sur. Town planning staff recommended approval.

But several commissioners were concerned over what they thought would be insufficient parking, even though Riverside's proposed location has the parking spaces required in the town zoning code.

"If you've ever been to a funeral in Taos, you know darn well that parking gets horrible," said Alfred Peralta, owner of the dry cleaner next door to the proposed Riverside location.

"None of us go to funerals in the same car because we'll be fighting by the end," said another person at the meeting.

Ultimately, the parking issues prevented the application from getting the OK. Only five members of the seven-person board were present and board chairman Douglas Patterson recused himself because he is the architect for the DeVargas funeral home. The vote was a tie and the application stalled.

But Finegan told The Taos News he's going to give his application "another shot" at a future commission meeting. First, he'll speak with nearby businesses about a plan for overflow parking.

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