[HISTORY: Adopted by the Board of Commissioners of the Township of Spring Garden as indicated in article histories. Amendments noted where applicable.]
[Adopted 12-13-2006 by Ord. No. 06-10 (Ch. 1, Part 8, of the 1994 Code)]
The Fire Chief of Spring Garden Township or such official's designee is hereby appointed as the designated officer who is authorized to carry out all responsibilities and duties stated in this article.
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 Spring Garden Township (hereinafter, the "Township") where the amount recoverable for the fire loss to the structure under all policies exceeds $7,500, unless the insuring agent is furnished by the Township Treasurer with a municipal certificate pursuant to § 638(B) of Act 98 of 1992 and unless there is compliance with § 638(C) and (D) of Act 98 of 1992 and the provisions of this article.
Editor's Note: See 40 P.S. § 638 et seq.
The Township Treasurer shall, upon the written request of the named insured specifying the tax description of the property, name and address of the insuring agent and the named insured as of the date of the receipt of a loss report of the claim, furnish the insuring agent either of the following within 14 working days of the request:
A certificate or, at the discretion of the Township, a verbal notification which shall be confirmed in writing by the insurer to the effect that, as of the date specified in the request, there are no delinquent taxes, assessment, penalties or user charges against the property and that, as of the date of the Treasurer's certificate or verbal notification, no municipality has certified any amount as total costs incurred by the municipality for the removal, repair or securing of a building or other structure on the property; or
A certificate and bills showing the amount of delinquent taxes, assessment, penalties and user charges against the property as of the date specified in the request that have not been paid as of the date of the certificate and also showing, as of the date of the Treasurer's certificate, the amount of the total costs, if any, certified to the Treasurer that have been insured by a municipality for the removal, repair, or securing of a building or other structure on the property. The municipality shall certify to the Treasurer the total amount, if any, of such costs. A tax, assessment, penalty or user charge becomes delinquent at the time and on the date a lien could otherwise have been filed against the property by the municipality under applicable law.
Where, pursuant to § 638(B)(1) of Act 98 of 1992, the Township Treasurer issues a certificate indicating that there are not delinquent taxes, assessments, penalties or user charges against real property, the insuring agent shall pay the claim of the named insured in accordance with the policy terms; provided, however, that, if the loss agreed to between the named insured and the insuring agent equals or exceeds 60% of the aggregate limits of liability on all fire policies covering the building or structure, the following procedures must be followed:
The insuring agent shall transfer from the insurance proceeds to the designated officer of the Township in the aggregate of $2,000 for each $15,000 of a claim; and for each fraction of that amount of a claim, this section is to be applied such that, if the claim is $15,000 or less, the amount transferred to the Township shall be $2,000; or if at the time of a loss report the named insured has submitted a contractor's signed estimate of the costs of removing, repairing or securing the building or other structure in an amount less than the foregoing transfer formula, the insuring agent shall transfer to the Township from the insurance proceeds the amount specified in the estimate.
The transfer of proceeds shall be on a pro rata basis by all insuring agents insuring the building or other structure. Policy proceeds remaining after the transfer to the Township shall be disbursed in accordance with the policy terms.
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 Township in excess of the estimate to the named insured if the Township has not commenced to remove, repair or secure the building or other structure.
Upon receipt of proceeds under this section:
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 Township. Such costs shall include, without limitation, any engineering, legal or administrative costs incurred by the Township in connection with such removal, repair or securing of the building or any proceedings related thereto.
It is the obligation of the insuring agent, when transferring the proceeds, to provide the Township 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 Township, and notify the named insured that the procedures under this subsection shall be followed.
When repairs, removal or securing of the building or other structure have been completed in accordance with all applicable regulations and orders of the Township and the required proof of such completion received by the designated officer, and if the Township has not incurred any costs for repairs, removal or securing, the fund shall be returned to the named insured. If the Township 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 Township shall transfer the remaining funds to the named insured.
To the extent that interest is earned on proceeds held by the Township pursuant to this section and not returned to the named insured, such interest shall belong to the Township. 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.
Nothing in this section shall be construed to limit the ability of the Township to recover any deficiency. Furthermore, nothing in this subsection shall be construed to prohibit the Township 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.
Proof of payment by the insuring agent under a policy in accordance with this article is conclusive evidence of the discharge of its obligation to the insured under the policy to the extent of the payment and of compliance by the insuring agent with this article.
Editor's Note: See 40 P.S. § 638(b)(1).
Upon receipt of a certificate and bill from the Treasurer, the insuring agent shall return the bill to the Treasurer and transfer to the Treasurer an amount from the insurance proceeds necessary to pay the taxes, assessments, penalties, charges, and costs as shown on the bill. The Township shall receive the amount and apply or credit it to the payment of the items shown in the bill.
An insuring agent making payments of policy proceeds under this article for delinquent taxes or structure removal liens or removal expenses incurred by a municipality shall have a full benefit of such payment, including all rights of subrogation and of assignment.
The Township of Spring Garden 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 municipal 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 any provision of this article shall, upon conviction thereof, be sentenced to a fine of not more than $1,000 plus costs and, in default of payment of said fine and costs, to a term of imprisonment not to exceed 30 days. Each offense and each day on which each offense shall continue shall be deemed a separate offense.