[HISTORY: Adopted by the City Council of the City of Auburn 7-2-1998
by L.L. No. 1-1998. Amendments noted where applicable.]
The City of Auburn, like other municipalities, experiences fires which
damage or destroy residential, commercial and industrial structures within
its city limits, many of which remain standing unrepaired. Oftentimes, insurance
proceeds are paid to the owner without the structure being repaired or demolished.
In addition, taxes are often due and outstanding on such real property which
often are not paid by the owner after a fire. General Municipal Law § 22
provides a procedure by which a municipality may file a lien with the Superintendent
of Insurance for any unpaid taxes, special ad valorem levy, special assessment
or other charges imposed upon real property.
As used in this chapter, the following terms shall have the meanings
indicated:
The City Treasurer.
An unpaid tax, special ad valorem levy, special assessment or other
charge imposed upon real property by or on behalf of the City of Auburn, whether
or not evidenced by written instrument, and provided that one such tax, levy,
assessment or other charge has remained undischarged for a period of one year
or more.
Property upon which there is erected any residential, commercial,
or industrial building or structure except a one- or two-family residential
structure.
Pursuant to General Municipal Law § 22, a claim against fire
insurance procedure is hereby established as follows: The City of Auburn is
hereby authorized and empowered to claim against the proceeds of a policy
of fire insurance insuring the interests of an owner and issued on real property
located within the City of Auburn to the extent of any liens thereon, which
claim, when made and perfected in a manner provided herein, shall further
constitute a lien against such proceeds and which shall, as to such proceeds,
be prior to all other liens and claims except the claim of a mortgagee of
record named in such policy.
Upon the adoption of a resolution by the City Council of the City of
Auburn, the City Treasurer shall cause a notice of intention to claim against
proceeds to be served upon the State Superintendent of Insurance for entry
into the index of tax districts maintained by him or her as provided in § 331
of the Insurance Law. Thereafter, the City Treasurer shall render to any insured
the certificate required and in the manner described by such section, and
the amount stated in such certificate shall be a lien on the proceeds of the
insurance policy until paid.
The City Treasurer shall release or return to the insured any amounts
to which the City of Auburn would otherwise be entitled to claim, provided
that the insured agrees with the City of Auburn, in writing, to restore the
affected premises to the same or improved condition that it was in prior to
the time that the lien of the City of Auburn against proceeds provided for
herein arose, subject to such conditions as such resolution shall provide
to guarantee performance of such obligation, including but not limited to
an agreement to deposit such proceeds in an escrow account or a requirement
that the insured obtain a performance bond.
The provisions herein shall not be deemed or construed to alter or impair
the right of the City of Auburn to acquire or enforce any lien against real
property but shall be in addition to any other power provided by law to acquire
or enforce such right.
