DETROIT—Government budget cuts have reached the potter's field.

Communities have long provided simple burials for the indigent or unidentified, but cash-strapped jurisdictions from North Dakota to Arizona are trimming subsidies, raising fees or switching to cremation. The deliberations over such changes underscore that in an era of austerity, governments have to face issues that touch on both the economic and the moral.

"Do we continue this benefit for those who are deceased, or do we divert [resources] to those who are living?" said Robert Lamkey, director of public safety for Sedgwick County, Kan., which is paying for such burials out of its general fund after the state ended its support.

Toledo, Ohio, is running out of burial funds and space in city-owned Forest Cemetery, Parks Commissioner Dennis Garvin told the City Council this month. So city leaders have proposed adopting cremation as the default option for indigent people, unless their religion bars it. The remains would then be commingled and poured into a double-deep vault. City Councilman Steve Steele asked Mr. Garvin whether the vault was like a "mass grave."

The change would save Toledo $600 per body and tens of thousands of dollars a year, according to the Parks and Forestry Division. The city buried 38 people last year.