Does a cemetery need a Phase I environmental assessment for an SBA loan?
Not automatically: it turns on embalming or cremation at the property and on the land's past uses. Cemeteries are NAICS 812220 Cemeteries and Crematories (13 CFR 121.201), which falls under this entry in Appendix 6 of SOP 50 10 8.1, SBA's list of environmentally sensitive industries:
8122 DEATH CARE SERVICES (unless no embalming or cremation at the Property)
For a cemetery the bracket is the whole question. When the land is offered as security for a 7(a) or 504 loan, the lender determines the NAICS codes for "the Property’s current and known prior uses" and compares them with Appendix 6 (Section A, Chapter 5, Paragraph E). A burial ground with no embalming and no cremation at the property falls within the stated exception; if no other current or known prior use matches, the loan amount sets the starting point: a questionnaire alone up to and including $250,000, and above that at least a questionnaire plus a Records Search with Risk Assessment. Add a crematory or an embalming room and the investigation "must begin with a Phase I, regardless of the amount of the loan". If a crematorium is anywhere in your plan, even phase two, raise it with the lender early.
Known prior uses are part of the test: land that was once a golf course, for example, matches a different Appendix 6 entry. The steps that can lead from a questionnaire to a Phase I, and all 55 listed codes, are in our SBA environmental requirements guide; confirm your site's route with your lender or Certified Development Company (CDC).
Frequently asked questions
How much does it cost to start a cemetery?
Starting a private cemetery in the US typically costs $1,000,000 to $5,000,000 all-in before the first plot is sold. Land is the biggest variable: a 20-acre rural parcel may cost $400,000 while a suburban site can exceed $2,000,000. Add site development, roads, landscaping, a small office building, equipment, and your perpetual care trust seed deposit.
Do you need a license to open a cemetery?
It depends on your state. Cemetery licensing is state law, not federal: many states license at least some cemeteries through a state cemetery board, banking regulator, or consumer-services agency. You also need local zoning approval, and in most states you must establish an irrevocable perpetual care trust fund before selling the first burial right.
What is a perpetual care fund and how much must you contribute?
A perpetual care fund is an irrevocable trust that ensures long-term maintenance of the cemetery grounds. Where state law requires one, it sets the share of each burial-right sale that must be deposited, commonly 10% to 15%, and the deadline for each deposit. The principal is preserved and only the investment income is used for maintenance.
How long does it take for a new cemetery to become profitable?
New cemeteries face a long ramp because 80% of cemetery sales are driven by the heritage factor, meaning families choosing where relatives are already buried. Most consultants estimate 10 to 20 years to reach sustained profitability, though a well-located pre-need program and columbarium component can shorten that timeline.
Can a cemetery add a columbarium or mausoleum?
Yes, and most modern cemetery business plans include both. A columbarium niche sells for $750 to $2,800 to consumers and generates far higher revenue per square foot than ground burial. Community mausoleum crypts sell for $4,000 to $8,000. Many states require a separate trust or performance bond before selling pre-constructed columbarium or mausoleum spaces.
Reviewed by Muhammad Tayyab Shabbir, Founder of AVVALE. Our team has prepared funding documents for 500+ businesses across regulated, capital-intensive and main-street industries, from SBA and bank loans to investor and visa applications.
Related business plans
Sources: IBISWorld Cemetery Services in the US (2025, $6.3B market size); NFDA 2025 Cremation & Burial Report (projected 2025 US burial rate 31.6% and cremation rate 63.4%; cremation projected at 82.3% by 2045); Bayer Cemetery Brokers market analysis (plot prices up 65% from 2018 to 2024, 17% year-over-year mid-2023 to mid-2024); Signature Headstones 2025 US Burial Plot Cost Report (city-level pricing); retipster.com cemetery business revenue analysis (perpetual care fund: up to 10% of plot sales; operating margin data); The Foresight Companies case study (land $80,000/acre, $1.2M to $1.5M annual sales needed to cover interest); Crestmont Capital cemetery financing guide (commercial loan terms); Florida Division of Funeral, Cemetery and Consumer Services (perpetual care 10% statutory requirement); Oklahoma Insurance Department (10% perpetual care minimum); North Carolina General Statutes Chapter 65, Section 65-63 (10% perpetual care requirement); Maine DHHS cemetery environmental regulations; 13 M.R.S. 1303 (who may own and operate a new cemetery in Maine); GAO, Survey of State Regulators, Regulation of Cemeteries (state answers on cemetery licensing); IBISWorld Funeral Homes in the US (2025, $20.8B market); Mausoleums.com crypt pricing guide (community mausoleum $4,000 to $8,000 per single crypt). All figures are industry ranges for planning purposes; confirm land costs, perpetual care percentages and licensing requirements for your specific state before filing. SBA rules: SBA SOP 50 10 8.1, effective 1 October 2026; 13 CFR 121.201; SBA's 504 loans page. We are not a lender, a CDC or an Environmental Professional: the SBA paragraphs are general information, so confirm them with your SBA lender or CDC.