[HISTORY: Adopted by the Borough Council
of the Borough of Trappe as indicated in article histories. Amendments
noted where applicable.]
[Adopted 1-5-1993 by Ord. No. 283 (Part
3, Ch. 5, of the 1987 Code)]
B.
Whereas, it is the purpose of said legislation to
deter the commission of arson and related crimes, to discourage the
abandonment of property, and to prevent urban blight and deterioration;
and
C.
Whereas, the Borough of Trappe desires to adopt an
ordinance pursuant to Section 508 of the Insurance Company Law of
1921 to provide for the payment of proceeds from certain fire loss
claims to the municipality.
The Borough Secretary or such officer'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 Trappe (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 Municipal Treasurer with a municipal certificate
pursuant to Section 508(B) of Act 98 of 1992[1] (and unless there is compliance with Section 508(C) and
(D) of Act 98 of 1992 and the provisions of this chapter).
[1]
Editor's Note: See 40 P.S. § 638(b).
Where pursuant to Section 508(B)(1)(I) of Act
98 of 1992, the Municipal 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 municipality 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 municipality 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 municipality from the insurance proceeds the amount
specified in the estimate.
C.
The transfer of proceeds shall be on a 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 municipality
in excess of the estimate to the named insured, if the municipality
has not commenced to remove, repair or secure the building or other
structure.
E.
Upon receipt of proceeds under this section, the municipality
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 other structure
which are incurred by the municipality. Such costs shall include,
without limitation, any engineering, legal or administrative costs
incurred by the municipality 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 municipality 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 municipality 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 municipality and the required proof
of such completion received by the designated officer, and if the
municipality has not incurred any costs for repairs, removal or securing,
the fund shall be returned to the named insured. If the municipality
has incurred costs for repairs, removal or securing of the building
or other structure, the costs shall be paid from the fund, and if
excess funds remain, the municipality shall transfer the remaining
funds to the named insured; and
(4)
To the extent that interest is earned on the proceeds
held by the municipality pursuant to this section, and not returned
to the named insured, such interest shall belong to the municipality.
To the extent that proceeds are returned to the named insured, interest
earned on such proceed 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 municipality to recover any deficiency. Furthermore,
nothing in this subsection shall be construed to prohibit the municipality
and the named insured from entering into an agreement that permits
the transfer of funds to the named insured if some other reasonable
disposition to the damaged property has been negotiated.
The Borough hereby charges an amount as set
by resolution of the Borough Council from time to time[2] to cover the fees and costs for the activities or services
provided pursuant to Act 98 of 1992 and this chapter, and, at such
time in the future, may by resolution adopt further procedures and
regulations to implement further Act 98 of 1992 and modify or otherwise
change and fix reasonable fees and charges for the services rendered
hereunder.
[Amended 1-5-1993 by Ord. No. 283]
Any owner of property, any named insured or
any insuring agent who violates this chapter shall be subject to a
penalty of up to $1,000 per violation.
