[HISTORY: Adopted by the Borough Council of the Borough of Columbia as indicated in article histories. Amendments noted where applicable.]
[Adopted 5-8-1995 by Ord. No. 663]
The Secretary/Treasurer of the Borough of Columbia or such official's designee (hereinafter the "municipal officer") is hereby appointed as the designated officer who is authorized to carry out all responsibilities and duties of the municipality stated herein.
As used in this article, the following terms shall have the meanings indicated:
- FIRE LOSS or CLAIM FOR FIRE DAMAGE
- Any loss occurring after the effective date of this article and covered under a policy of fire insurance, including any endorsement or riders to said policy of fire insurance.
No insurance company, association or exchange (hereinafter the "insurer") 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 Columbia, County of Lancaster, Commonwealth of Pennsylvania (hereinafter the "municipality"), where the amount recoverable for the fire loss to the structure under all policies exceeds $7,500, unless the insurer and the named insured comply with the provisions of Section 508(b) and the provisions of this article.
Editor's Note: See 40 P.S. § 638.
The municipal officer shall, upon the written request of the named insured specifying the tax description of the property, name and address of the insurer and the date agreed upon by the insurer and the named insured as the date of a receipt of a loss report of the claim, furnish the insurer either of the following within 14 working days of the request:
A certificate or, at the discretion of the municipality, 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, assessments, penalties or user charges against the property and that, as of the date of the municipal officer's certificate or verbal notification, the municipality has not 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 bill showing the amount of the municipal liens, delinquent taxes, assessments, penalties and use charges against the property (including administration costs and attorney's fees) 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 municipal officer's certificate, the amount of the total cost, if any, certified to the municipal officer that have been incurred by the municipality for the removal, repair or securing of a building or other structure on the property. For the purposes of this clause, the municipality shall provide to the municipal officer the total amount, if any, of such costs, if available, or the amount of costs known to the municipality at the time of the municipal officer's certificate. A tax, assessment, penalty or user charge (including administration costs and attorney's fees) 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.
Upon the receipt of a certificate pursuant to Subsection B(1) of this section, the insurer shall pay the claim of the named insured in accordance with the policy terms.
Upon the receipt of a certificate and bill pursuant to Subsection B(2) of this section, the insurer shall return the bill to the municipal officer and transfer to the municipal officer an amount from the insurance proceeds necessary to pay the 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 municipality shall receive the amount and apply or credit it to payment of the items shown in the bill.
Nothing in this article shall be construed to limit the ability of the municipality to recover any deficiency in taxes, assessments, penalties, charges and costs (including administration costs and attorney's fees) as detailed herein following payment from the insurer and crediting of such payment to the bill by the municipality.
No insurer doing business in the Commonwealth of Pennsylvania shall pay a claim of a named insured for a fire damage to a structure located within the municipality where the amount recoverable for the fire loss to the structure under all policies exceeds $7,500, unless the insurer is furnished by the municipal officer with a municipal certificate pursuant to Section 508(b) and § 134-3B of this article and unless there is compliance with Sections 508(c) and (d).
After full compliance with the requirements of Section 508(b)(1)(i) and § 134-3B through F of this article, the insurer shall pay the claim of the named insured; provided, however, that if the loss as agreed upon by the named insured and the insurer equals 60% of the aggregate limits of liability on all fire policies covering the building structure, the following procedures shall be followed:
The insurer shall transfer from the insurance proceeds to the municipal officer the aggregate of $2,000 for each $15,000 of a claim and for each fraction of that amount of a claim, provided that this section is to be applied such that if the claim is $15,000 or less, the amount transferred to the municipality shall be $2,000; and that, if at the time of a loss report the named insured has submitted a contract or signed estimate of the costs of removing, repairing or securing the building or other structure in an amount less than the amount calculated under the foregoing transfer formula, the insurer shall transfer to the municipality from the insurance proceeds the amount based upon the estimate.
After the transfer of proceeds to the municipal officer pursuant to Subsection B of this section, the named insured may submit a contract or signed estimate of the cost of removing, repairing or securing the building or other structure, and the municipal 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.
Upon receipt of proceeds of insurance under Subsection B of this section, the municipality shall do the following:
The municipal 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 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
It is the obligation of the insurer 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 municipal officer shall contact the named insured, certify that the proceeds have been received by the municipality and notify the named insured that the procedures established under this Subsection D shall be followed; and
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 municipal officer, and if the municipality has not incurred any costs for repairs, removal or securing, the funds 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
To the extent that interest is earned on proceeds held by the municipality pursuant to Subsection D of this section and retained by it, such interest shall belong to the municipality. To the extent that the 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 Subsections A through D of this section shall be construed to limit the ability of the municipality to recover any deficiency remaining after application of the proceeds escrowed by the municipality against costs incurred by the municipality in removing, repairing or securing the building or structure. Furthermore, nothing in Subsections A through D of this section 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 of the damaged property has been negotiated.
The Borough Council of the municipality may, by resolution, adopt additional procedures and regulations to implement Section 508 and this article and may, by resolution, fix reasonable fees to be charged for municipal activities or services provided pursuant to Section 508 in this article, including, but not limited to, issuance of certificates and bills.
Any owner of property, any named insured or any insurer who violates this article shall be subject to a penalty of up to $1,000 per violation.
A certified copy of this article shall be filed with the Department of Community and Economic Development of Pennsylvania on or before its effective date.