[HISTORY: Adopted by the Borough Council of the Borough of
Northampton as indicated in article histories. Amendments noted where
applicable.]
GENERAL REFERENCES
Fire department — See Ch. 28.
[Adopted 5-6-1993 by Ord. No. 1045 (Ch. 1, Part 12, of the
1993 Code of Ordinances)]
With respect to any fire loss to any building located within
the Borough occurring after the effective date of this article, the
following procedure shall be established.
In all cases in which the loss agreed to between the named insured
and the insurance company, association or exchange covering the property
for fire damage equals or exceeds 60% of the aggregate limit of liability
on all fire policies covering the building (so long as the amount
recoverable for said fire loss also exceeds $5,000), then said company,
association or exchange shall be required to pay to the appropriate
Borough official as designated hereunder an amount calculated as follows:
A.
An amount in the aggregate of $1,000 for each $20,000 (and/or fraction
thereof) amount of said loss.
B.
In the alternative, if at the time said loss is agreed to between
the named insured and the insurance company, the named insured has
submitted a contractor's signed estimate of the cost of removing,
repairing or securing the building or other structure, the amount
specified in such estimate.
The amount transferred in the event that there is more than
one company providing insurance shall be apportioned between said
companies on a pro rata basis calculated on the amount of insurance
provided by each said company.
[Amended 7-16-2009 by Ord. No. 1167]
In the event that payment is made to the designated municipal official as provided under § 140-2A, if after said transfer the named insured submits a contractor's signed estimate of the cost of removing, repairing and securing the building or other structure, then the Borough Manager shall return the amount of the funds transferred (if any) in excess of said estimate, providing that the Borough has not already commenced to remove, repair and secure the building itself.
Upon receipt of the proceeds transferred under § 140-2 hereunder, the designated Borough official shall place the proceeds in a separate escrow fund to be used solely as security against the total cost of removing, repairing or securing said property as incurred by the Borough.
Upon receipt of said funds, the Borough shall immediately notify
the named insured (providing that the company, association or exchange
providing insurance has properly notified the Borough of the name
and address of the named insured) and certify that the proceeds have
been received and that this article will be in effect.
[Amended 7-16-2009 by Ord. No. 1167]
Said escrow funds shall be maintained until all repairs, required
removals and securing of the building or other structure in accordance
with the Borough Health and Safety Codes has been completed and proof
thereof submitted to the designated municipal official, at which time
the funds shall be disbursed as follows:
A.
In the event the Borough has itself incurred costs for repairs, removal
or securing of the property as authorized by the Borough health and
safety codes, then said costs shall be paid from said escrow fund.
B.
Following the completion of said repairs, removal and securing of
a building or other structure, and reimbursement from said fund to
the Borough (if said repairs, removal and securing has been performed
by the Borough), the remainder of the funds, if any, shall be released
to the named insured or his/its designee.
C.
No payment shall be made unless and until the insured or his/its
designee certifies, warrants, and represents that he/it or the designee
is solely entitled to the escrow funds; and generally releases and
discharges the Borough of Northampton from all claims from any third
parties, persons, or entities who may claim said funds; and further
indemnifies, and holds harmless the Borough from any such claims.
Said general release shall be in substantially the attached form as
set forth in Exhibit A.[1]
[1]
Editor's Note: Exhibit A is on file in the Borough offices.
Nothing in this article shall be construed to limit the ability
of the Borough to take any action against the named insured or any
other responsible individual under the Borough health and safety codes,
nor shall the establishment of said escrow fund limit in any way the
Borough's ability to pursue any action for imposition of any
penalties or recovery of any amounts in excess of said escrow fund
from any responsible party including the named insured.
The designated Borough official responsible for administering
said escrow fund shall be the Borough Manager.
[Adopted 4-1-1999 by Ord. No. 1095]
The Treasurer of the Borough of Northampton or such official's
designee is hereby appointed as the designated Borough officer who
is authorized to carry out all responsibilities and duties stated
herein.
A "fire loss" or claim for fire damage is defined as any loss
occurring after the effective date of this article and covered under
an policy of fire insurance, including all endorsements or riders
to the policy.
No insurance company, association or exchange (hereinafter the
"insuring entity") 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 Northampton (hereinafter the "Borough")
where the amount recoverable for the fire loss to the structure under
all policies exceeds $7,500, unless the insuring entity is furnished
by the Borough Treasurer with a municipal certificate pursuant to
Section 508(b) of the Insurance Company Law of 1921,[1] as amended (the "Insurance Law") and § 140-13 of this article, and unless there is compliance with Sections 508(c) and (d) of the Insurance Law and the provisions of this article.
[1]
Editor's Note: See 40 P.S. § 638.
The Borough 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 date agreed upon by the
insuring entity and the named insured as the date of the receipt of
a loss report of the claim, furnish the insuring entity either of
the following within 14 working days of the request:
A.
A certificate to the effect that, as of the date specified in the
request, there are no delinquent taxes, assessments, penalties or
user charges against the property and that, as of the date of the
Borough Treasurer's certificate, the Borough has not certified
any amount as total costs incurred by the Borough for the removal,
repair or securing of a building or other structure on the property;
or
B.
A certificate and bill showing the amount of delinquent taxes, assessments,
penalties and use charges against the property as of the date specified
in the request that have not been paid as of the date of the Borough
Treasurer's certificate and also showing, as of the date of the
Borough Treasurer's certificate, the amount of the total costs,
if any, certified to the Borough Treasurer that have been incurred
by the Borough for the removal, repair or securing of a building or
other structure on the property. For the purposes of this subsection,
the Borough shall provide to the Borough Treasurer the total amount,
if any, of such costs, if available, or the amount of costs known
to the Borough at the time of the Borough Treasurer's certificate.
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 Borough under applicable law.
Upon receipt of a certificate pursuant to § 140-13A, the insuring entity shall pay the claim of the named insured in accordance with policy terms, except that if the loss agreed upon by the named insured and the insuring entity equals or exceeds 60% of the aggregate limits of liability on all fire insurance policies covering the building or other structure, the procedures set forth in § 140-16 below shall be followed.
Upon the receipt of a certificate and bill pursuant to § 140-13B, the insuring entity shall return the bill to the Borough Treasurer and transfer to the Borough Treasurer an amount from the insurance proceeds necessary to pay taxes, assessments, penalties, charges and costs as shown on the bill, or the full amount of the insurance proceeds, whichever is the lesser amount. The Borough shall receive the amount and apply or credit it to payment of the items shown in the bill. Further, the terms of § 140-16 shall be followed, if applicable. Nothing in this section shall be construed to limit the ability of the Borough to recover any deficiency.
Where pursuant to Section 508(b)(1)(i) of the Insurance Law,[1] and § 140-13A, the Borough Treasurer issues a certificate indicating that there are no delinquent taxes, assessments, penalties or user charges against real property, the Insuring Entity 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 insurance policies covering the building or other structure, the following procedures must be followed:
A.
The insuring entity shall transfer from the insurance proceeds to
the Borough Treasurer 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
to be applied such that if the claim is $15,000 or less, the amount
transferred to the Borough shall be $2,000.
B.
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 amount calculated under Subsection A above, the insuring entity shall transfer to the Borough from the insurance proceeds the amount specified in the estimate.
C.
The transfer of proceeds to the Borough shall be on a pro rata basis
by all companies, associations or exchanges insuring the building
or other structure. Policy proceeds remaining after the transfer to
the Borough shall be disbursed in accordance with the policy terms.
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 Borough Treasurer 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 Borough Treasurer 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;
(2)
It is the obligation of the insuring entity 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 Borough Treasurer 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;
(3)
When repairs, removal or securing of the building or other structure
have been completed in accordance with all applicable procedures,
regulations and orders of the Borough and the required proof of such
completion received by the Borough Treasurer, 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 cots shall be paid from the fund and if 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 such proceeds are 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
subsection 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.
[1]
Editor's Note: See 40 P.S. § 638(b)(1)(i).
The Borough Council may by resolution adopt procedures and regulations
to implement Section 508 of the Insurance Law[1] and this article and may by resolution fix reasonable
fees to be charged for municipal activities or services provided pursuant
to the Insurance Law and this article, including but not limited to
issuance of certificates and bills, performance of inspections and
opening separate fund accounts.
[1]
Editor's Note: See 40 P.S. § 638.
Any owner of property, any named insured or any insuring entity
who or which violates any provision of this article shall, upon a
judicial determination thereof, be subject to a judgment for each
such violation of not more than $1,000, reasonable attorney's
fees, plus costs of suit. All such sums shall be paid to the Borough
of Northampton.
Upon adoption of this article, an exact copy hereof shall be
filed with the Pennsylvania Department of Community and Economic Development,
together with the name, position and phone number of the Borough Treasurer.
