This chapter governs the permit process for persons, regulated under Business Regulation Article, Title 5, Annotated Code of Maryland, who operate a reduction facility in the State and the fees for reduction facilities and registered reduction operator permits. A person who holds a permit or registration under Business Regulation Article, Title 5, Annotated Code of Maryland, and owns a greater interest in a reduction facility than a licensee under Health Occupations Article, Title 7, Annotated Code of Maryland, shall obtain a permit to engage in the operation of a reduction facility from the Office. A person whose ownership interest in a reduction facility is equal to the ownership interest in the reduction facility of a licensee under Health Occupations Article, Title 7, Annotated Code of Maryland, shall obtain a permit to engage in the operation of a reduction facility from the Office. A person who owns a reduction facility and is neither a licensee under Health Occupations Article, Title 7, Annotated Code of Maryland, nor a registrant or permit holder under Business Regulation Article, Title 5, Annotated Code of Maryland, shall obtain a permit to engage in the operation of a reduction facility from the Office. A person who is a licensee or holder of a corporation license under Health Occupations Article, Title 7, Annotated Code of Maryland, and owns a greater interest in a reduction facility than a person who holds a permit or registration under Business Regulation Article, Title 5, Annotated Code of Maryland, shall obtain a permit to engage in the operation of a reduction facility from the Board. An individual, who is designated as the registered reduction operator by a person required to obtain a permit to operate a reduction facility from the Office, shall obtain a registered reduction operator permit from the Office. All operating reduction facilities and individuals designated as the registered reduction operator required to obtain a permit from the Office shall apply to the Office for a permit. A corporation, limited liability company, or partnership shall receive a permit to operate a reduction facility in this State if the corporation, limited liability company, or partnership meets the permit requirements of this regulation. A corporation, limited liability company, or partnership shall receive a permit if the entity: Completes an application form; Pays the nonrefundable application fee and any other fees due under this chapter; Provides the name, address, and phone number of each affiliated reduction facility; Designates a registered reduction operator as the responsible party for each affiliated reduction facility provided that the registered reduction operator may not be designated as the responsible party for more than a total of two reduction facilities; Provides a list of the officers, directors, members, partners, agents, and employees of the entity applying for the permit; Provides a certificate of status, issued by the Maryland Department of Assessments and Taxation, indicating that the entity is in good standing, or its equivalent as determined by the Office, and dated not earlier than 30 days before the date of the application; Provides evidence of a bond, letter of credit, or trust account established to meet the requirements of Regulation .07 of this chapter; and Provides an affidavit stating that: No local, federal, or State taxes or fees are delinquent; and The corporation, limited liability company or partnership is financially stable. A sole proprietor applicant for a reduction facility permit shall receive a permit to operate a reduction facility in this State if the sole proprietor applicant meets the permit requirements of this regulation. A sole proprietor shall receive a permit if the sole proprietor: Completes an application form; Pays the nonrefundable application fee and any other fees due under this chapter; Provides the name, address, and phone number of each affiliated reduction facility; Designates a registered reduction operator as the responsible party for each affiliated reduction facility provided that the registered reduction operator may not be designated as the responsible party for more than a total of two reduction facilities; Provides evidence of a bond, letter of credit, or trust account established to meet the requirements of Regulation .07 of this chapter; Provides an affidavit stating that: No local, federal, or State taxes or fees are delinquent; and The reduction facility business is financially stable. An individual shall register with and receive a permit from the Office as a registered reduction operator if the individual meets the registration requirements of this regulation. An individual shall be registered with the Office as a registered reduction operator if the individual: Completes an application form; Pays the nonrefundable application fee and any other fees due under this chapter; Is 18 years old or older; Is of good character and reputation and provides at least three character references from employers, community leaders, or professional societies, that the applicant is an individual of good character and reputation; Has achieved certification as a reduction operator by the Cremation Association of North America, International Cemetery, Cremation and Funeral Association, or other equivalent certification recognized by the Office and the Board; Has successfully completed the operator training course of the manufacturer of each vessel located in the reduction facility with which the applicant is affiliated; States the name and mailing address of the reduction facility with which the applicant is affiliated; States whether the reduction facility with which the applicant is affiliated is owned or controlled by: A corporation; A partnership; A limited liability company; or A sole proprietorship; and States whether the applicant is the responsible party for the affiliated reduction facility. Additional Requirements. An individual applying for a permit as a registered reduction operator shall provide the Office with a detailed description of activities including, but not limited to, whether the applicant has: Had a license, certification, registration, or permit of the type for which the application is being made ever denied, suspended, or revoked by any jurisdiction; Been convicted of a felony in any state or federal court; Been convicted in any State or federal court of a misdemeanor directly related to the ownership or operation of a reduction facility; Had any civil judgments or settlements within the 5 years before applying for a permit which directly related to the ownership or operation of a reduction facility; or Been convicted by a court in this State of violating a usury provision under Commercial Law Article, Title 12, Annotated Code of Maryland, or an unfair and deceptive trade practices provision under Commercial Law Article, Title 13, Annotated Code of Maryland. An applicant shall submit copies of all: Charging documents which were issued and docket entries for convictions, which occurred before applying for a permit, for a misdemeanor or felony referred to in §C(1)(b), (c), or (e) of this regulation; Disciplinary actions, judgments, and final orders which occurred or were issued before applying for a permit for any regulatory probation, suspension, or revocation referred to in §C(1)(a) of this regulation; and Civil judgments or settlements against the applicant within the past 5 years which directly relate to the ownership or operation of a reduction facility. An individual applying for a permit, who is designated by the permit holder as the responsible party, shall state the name and residential address of each employee who sells goods or services to the public while engaging in the operation of a reduction facility. A registered reduction operator may not be designated as the responsible party for more than two reduction facilities. An individual may be issued permits for affiliations with more than two reduction facilities if each affiliated reduction facility is owned by the same individual or entity. An individual who will become the registered reduction operator for a reduction facility which was in operation prior to the effective date of this chapter or for a reduction facility which has filed an application for a permit pursuant to this chapter shall obtain the certification and training required by §B(5) and (6) of this regulation within 90 days from the effective date of this chapter or be subject to action by the Office. A sole proprietor, corporation, limited liability company, or partnership shall receive a permit to operate a new reduction facility in this State if the sole proprietor, corporation, limited liability company, or partnership meets the permit requirements of this regulation. A sole proprietor, corporation, limited liability company, or partnership shall receive a permit from the Office if, at least 30 days prior to the opening of the new reduction facility, the entity: Completes an application form; Pays the nonrefundable application fee and any other fees due under this chapter; Provides the name, address, and phone number of each affiliated reduction facility; Designates a registered reduction operator as the responsible party for each affiliated reduction facility provided that the registered reduction operator may not be designated as the responsible party for more than a total of two reduction facilities; A corporation, limited liability company, or partnership shall provide a list of the officers, members, partners, agents, and employees of the entity applying for the permit; Provides evidence of a surety bond established to meet the requirements of Regulation .07 of this chapter; and Provides an affidavit stating that the sole proprietor, corporation, limited liability company, or partnership: Is financially stable; and Has the ability to continue to operate the reduction facility business for a 2-year period after issuance of a permit. With each application for a new permit and renewal for an existing permit, a permit holder or an applicant shall provide proof of a surety bond with the Office. Surety Bond. The bond shall run to the Office, as obligee, for the benefit of: The State; and Any consumer who has been damaged by a violation committed by a permit holder of any law or regulation governing the activities of reduction facilities. The bond shall be: In an amount determined by the Office under §C of this regulation; and Issued by a surety company that: Is authorized to do business in the State; Holds a certificate of authority issued by the Maryland Insurance Commissioner; and Conditioned that the licensee shall comply with all Maryland laws regulating the activities of natural organic reduction. The liability of the surety: Shall be continuous; May not be aggregated or cumulative, whether or not the bond is renewed, continued, replaced, or modified; May not be determined by adding together the penal sum of the bond, or any part of the penal sum of the bond, in existence at any two or more points in time; Shall be considered to be one continuous obligation, regardless of increases or decreases in the penal sum of the bond; May not be affected by: The insolvency or bankruptcy of the permit holder; Any misrepresentation, breach of warranty, failure to pay a premium, or any other act or omission of the permit holder or an agent of the permit holder; or The suspension of the permit; May not require an administrative enforcement action by the Office as a prerequisite to liability; and Shall continue for 3 years after the later of the date on which: The bond is canceled; or The permit holder, for any reason, ceases to be permitted. A bond may be canceled by the surety or the licensee by giving notice of cancellation to the Office. Notice of cancellation shall: Be in writing; and Be sent by certified mail, return receipt requested. A cancellation of a bond is not effective until 90 days after receipt of a notice of cancellation by the Office. A claim against the bond may be filed with the surety by: A claimant; or The Office for the benefit of a claimant or the State. If the amount of claims against a bond exceeds the amount of the bond, the surety: Shall pay the amount of the bond to the Office for pro rata distribution to claimants; and Is relieved of liability under the bond. If the penal amount of a bond is reduced by payment of a claim or judgment, the permit holder shall file a new or additional bond with the Office. A penalty imposed against a permit holder under Business Regulation Article, §5-905, Annotated Code of Maryland may be collected and paid from the proceeds of a bond required under this section. Annuity and Surety Bond. The amount of the surety bond under §B of this regulation shall be in an amount of not less than $10,000 and not more than $20,000, as determined by the Office for each vessel used for natural organic reduction by the permit holder. In setting the amount of the surety bond, the Office may consider: The nature and volume of the business or proposed business of the permit holder or applicant; The financial condition of the permit holder or applicant, including: The amount, nature, quality, and liquidity of the assets of the permit holder or applicant; The amount and nature of the liabilities, including contingent liabilities, of the permit holder or applicant; The history of and prospects for the permit holder or applicant to earn and retain income; The potential harm to consumers if the applicant or permit holder becomes financially impaired; and Any other factor that the Office considers relevant. Subject to approval by the Office, an applicant for a permit who files an application for a new permit or renewal of a permit may satisfy the bonding requirement under this section by establishing a trust account with or obtaining an irrevocable letter of credit from a financial institution insured by the Federal Deposit Insurance Corporation in an amount equal to the bond required under this section. If a permit holder is subject to a receivership proceeding, the Office or a court-appointed receiver without regard to any priorities, preferences, or adverse claims, may: Reduce the bond or the deposit in lieu of a bond to cash; and Use the cash to defray the costs associated with the receivership. The responsible party shall notify the Office of any change in the information provided in the application for permit for a reduction facility or for a permit as a registered reduction operator, either before or after the issuance of a permit, within 1 week of the date of the change. Before the expiration date of a permit, a permit holder shall complete and return the renewal form, pay the renewal fee, and submit any required documentation. A person who has a permit to engage in the operation of a reduction facility or a permit as a registered reduction operator may renew the permit every 2 years, beginning on a date specified by the Office, in the following manner: Complete the renewal application form; Pay the nonrefundable renewal fee set forth in Regulation .12 of this chapter; Meet the permit requirements under Regulation .03, .04, or .05 of this chapter; and Submit the documentation required by Regulation .03, .04, or .05 of this chapter. After the expiration date of a permit, if a permit holder has not yet applied for renewal, the permit holder is no longer authorized to engage in the operation of a reduction facility or to act as a registered reduction operator. If a permit holder completes the renewal application process set forth in §B of this regulation before the expiration date of the permit and the Office does not renew the permit before its expiration date, the permit holder is considered to be actively permitted until receipt from the Office of either a renewed permit or a notice of denial of a permit. If a permit holder applies for renewal of a permit after the expiration date of the permit, the permit holder shall pay the renewal fee plus the late renewal fee under Regulation .12 of this chapter. A person who has been issued a permit and who has allowed the permit to lapse for at least 6 months may apply for a permit in the following manner: Complete a permit application form; Pay the permit fee and the late renewal fee under Regulation .12 of this chapter; Meet the permit requirements under Regulation .03, .04, or .05 of this chapter; Submit the documentation required by Regulation .03, .04, or .05 of this chapter; Provide a full written explanation to the Office detailing the reasons why the permit was allowed to expire and why a permit is now sought; and Submit to the Office an affidavit stating that the person did not engage in the operation of a reduction facility or act as a registered reduction operator in this State while the permit was lapsed. Permit Denial. An applicant or permit holder applying for an initial or renewal permit to the Office may be denied the issuance of a permit, subject to the hearing provisions of Business Regulation Article, §5-312, Annotated Code of Maryland. Hearing Before Director of Office. Except as otherwise provided in §B(2)-(6) of this regulation, all contested cases before the Director of the Office shall be governed by COMAR 09.01.02. An applicant who has been notified that a new or renewal permit has been or may be denied and who requests a hearing before the Director of the Office must file the request for a hearing not later than 30 days after the notice of proposed action was mailed. The Director of the Office shall send the hearing notice described in COMAR 09.01.02.07B at least 10 days before the hearing or, if the parties have agreed to a date for which 10 days notice cannot be given, at the earliest time possible. The notice to an applicant that a new or renewal permit has been or may be denied shall state that the proposed action of the Director of the Office shall be affirmed if: A hearing is not requested within 30 days after the date the notice of proposed action was mailed; or The applicant fails to appear for the hearing after requesting a hearing. If, after a hearing, the proposed action of the Director of the Office is upheld, the appellant shall pay the hearing costs described in Regulation .12 of this chapter. Hearings Delegated by the Office to the Office of Administrative Hearings. All contested case hearings delegated to the Office of Administrative Hearings shall be governed by COMAR 09.01.03. Permit fees: Initial and renewal reduction facility permit – $350; Initial and renewal registered reduction operator permit – $300; and Late renewal fee – $200. Miscellaneous fees: Replacement of permit – $50; Returned check fee – $50; Additional copy of permit – $50; Business name change – $50; Personal name change – $50; and Business address change – $50. Hearing costs described in Business Regulation Article, §5-312(h), Annotated Code of Maryland, shall be determined to be the cost of a court reporter and the transcripts ordered by the Office, or by the Office of the Attorney General, for the purpose of presenting a case alleging violation of Business Regulation Article, Title 5, Annotated Code of Maryland, before the Office or before the Office of Administrative Hearings. A permit holder shall display the permit conspicuously, in a public area at each business address of the permit holder. Reduction facilities may perform the natural organic reduction of one decedent prior to obtaining a permit from the Office provided: The natural organic reduction is only performed as part of the manufacturer’s operator training course for the vessel in which the natural organic reduction takes place; and The authorizing agent of the decedent is notified and has given permission prior to the natural organic reduction. Business Regulation Article, §5-204, Annotated Code of Maryland Effective date: March 30, 2026 (53:6 Md. R. 287)