[HISTORY: Adopted by the Borough Council of Montgomery Borough
as indicated in article histories. Amendments noted where applicable.]
[Adopted 6-13-2006 by Ord. No. 2006-2]
The Borough Office Manager/Assistant Secretary 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 Montgomery (hereinafter the "Borough")
where the amount recoverable for the fire loss to the structure under
all policies exceeds $7,500 unless the insurance company, association
or exchange (hereinafter the "insuring agent") is furnished by the
Borough Treasurer with a municipal certificate pursuant to § 508(a)
of Act 98 of 1992, and unless there is compliance with § 508(c)
and (d) of Act 98 of 1992[1] and the provisions of this article.
[1]
Editor's Note: See 40 P.S. § 638.
Where pursuant to § 508(b)(1)(i) of Act 98 of 1992,
the Borough Treasurer issues a certificate indicating that there are
no delinquent taxes, assessments, penalties or user charges against
real property, nor any costs incurred by the Borough for the removal,
repair or securing of a building or other structure on the 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 Borough 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 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 Borough 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 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 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 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 agent 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 designated officer 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 regulations
and orders of the Borough, and the required proof of such completion
has been received by the designated officer, and if the Borough has
not incurred 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 costs shall be paid from the fund, and if excess funds remain,
the Borough shall transfer the remaining funds to the named insured.
(4)
To the extent that interest is earned on proceeds held by the Borough
pursuant to this section and 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 the limit the ability
of the Borough to recover any deficiency. Furthermore, nothing in
this section 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.
The Montgomery Borough 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 Borough
activities or services provided pursuant to Act 98 of 1992 and this
article, including, but not limited to, issuances of certificates
and bills.
Any person, firm or corporation who shall violate any provision
of this article shall, upon conviction thereof, be sentenced to pay
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 day that a violation of this article, or any section hereof,
continues shall constitute a separate offense.
