[Adopted 3-16-2004 by Ord. No. 553]
The Borough Secretary or such official's designee
is hereby appointed as the designated officer who is authorized to
carry out all responsibilities and duties stated herein.
No insurance company, association or exchange
(hereinafter the "insuring agent") doing business in the Commonwealth
of Pennsylvania shall pay a claim of a named insured for fire damage
to a structure located within the Borough of Heidelberg (hereinafter
the "municipality") where the amount recoverable for the fire loss
to the structure under all policies exceeds $5,000, unless the insuring
agent is furnished by the Borough Treasurer with a municipal certificate
pursuant to § 508 of Act 98 of 1992 and unless there is compliance with § 508 (c)
and (d) of Act 98 of 1992 and the provisions of this article.
Where pursuant to § 508 (b) (1) (I)
of Act 98 of 1992, the Borough Treasurer issues a certificate indicating
that there are no delinquent taxes, assessments, penalties or user
charges against real property, the insuring agent shall pay the claim
of the named insured; provided, however, that if the loss agreed upon
by the named insured and the insuring agent equals or exceeds 60%
of the aggregate limits of liability on all fire policies covering
the building restructure, the following procedures must be followed:
A. The insuring agent shall transfer from the insurance
proceeds to the designated officer of the Borough in the aggregate
of $1,000 for each $20,000 of a claim and for each fraction of that
amount of a claim, this section to be applied such that if the claim
is $20,000 or less, the amount transferred to the Borough shall be
$1,000; or
B. If at the time of a proof of loss agreed to between
the named insured and the insuring agent, the named insured has submitted
a contractor's signed estimate of the costs of removing, repairing
or securing the building or other structure, the insuring agent shall
transfer to the Borough from the insurance proceeds the amount specified
in the estimate.
C. The transfer of proceeds shall be on pro rata basis
by all companies, associations or exchanges insuring the building
or other structure.
D. After the transfer, the named insured may submit a
contractor's signed estimate of the costs of removing, repairing or
securing the building or other structure, and the designated officer
shall return the amount of the funds transferred to the Borough in
excess of the estimate to the named insured, if the Borough has not
commenced to remove, repair or secure the building or other structure.
E. Upon receipt of proceeds under this section, the Borough
shall do the following:
(1) The designated officer shall place the proceeds in
a separate fund to be used solely as security against the total costs
of removing, repairing or securing the building or structure which
are incurred by the Borough. Such costs shall include, without limitation,
any engineering, legal or administrative costs incurred by the Borough
in connection with such removal, repair or securing of the building
or any proceedings related thereto; and
(2) It is the obligation of the insuring agent when transferring
the proceeds to provide the Borough with the name and address of the
named insured. Upon receipt of the transferred funds and the name
and address of the named insured, the designated officer shall contact
the named insured, certify that the proceeds have been received by
the Borough and notify the named insured that the procedures under
this subsection shall be followed; and
(3) When repairs, removal or securing of the building
or other structure have been completed in accordance with all applicable
regulations and orders of the Borough and the required proof of such
completion received by the designated officer, and if the Borough
has not incurred any costs for repairs, removal or securing, the fund
shall be returned to the named insured. If the Borough has incurred
costs for repairs, removal or securing of the building or other structure,
the costs shall be paid from the fund and, if the excess funds remain,
the Borough shall transfer the remaining funds to the named insured;
and
(4) To the extent that interest is earned on proceeds
held by the Borough pursuant to this section, and not returned to
the named insured, such interest shall belong to the Borough. To the
extent that proceeds are returned to the named insured, interest earned
on such proceeds shall be distributed to the named insured at the
time that the proceeds are returned.
F. Nothing in this section shall be construed to limit
the ability of the Borough to recover any deficiency. Furthermore,
nothing in this section shall be construed to prohibit the Borough
and the named insured from entering into an agreement that permits
the transfer of funds to the named insured if some other reasonable
disposition of the damaged property has been negotiated.
The Borough Council of the Borough of Heidelberg
may, by resolution, adopt procedures and regulations to implement
Act 98 of 1992, and this article and may, by resolution, fix reasonable
fees to be charged for Borough activities or services provided pursuant
to Act 98 of 1992, and this article, including, but not limited to,
issuance of certificates and bills, performance of inspections and
opening separate fund accounts.
Any owner of property, any named insured or
any insuring agent who violates this article shall be subject to a
penalty of up to $1,000 per violation.