As used in this chapter, any inconsistent provisions of law
notwithstanding, the following terms shall have the following meanings:
LIEN
Any unpaid tax, special ad valorem levy, special assessment
or other charge imposed upon real property by or on behalf of the
City or special district, which is an encumbrance on real property,
and which has remained undischarged for a period of one year or more.
REAL PROPERTY
Any property upon which there is erected any residential,
commercial or industrial building or structure except an owner-occupied
single-family or two-family residence.
SPECIAL LIEN
A lien upon fire insurance proceeds pursuant to this chapter
and § 22 of the General Municipal Law.
Upon the adoption of a resolution by the Common Council providing
therefor, the enforcing officer shall file a notice of intention to
claim against the proceeds of fire insurance policies with the State
Superintendent of Insurance for entry in the Index of Tax Districts
in accordance with § 22 of the General Municipal Law, the
New York State Insurance Law and all rules and regulations promulgated
by the New York State Department of Insurance with respect to this
procedure.
Prior to the payment of any proceeds of a policy of insurance
for damages caused by fire to real property, which policy insures
the interest of an owner and is issued on real property located within
the City, and following notification to the enforcing officer by an
insurer of the filing of a claim for payment of such proceeds, the
enforcing officer shall claim, by serving a certificate of lien, against
such proceeds to the extent of any lien, including interest and penalties
to the date of the claim thereon, which claims, when made and perfected
in the manner provided for in § 22 of the General Municipal
Law and § 331 of the Insurance Law, shall constitute a special
lien against such proceeds and 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. Notice of the service of the certificate of
the special lien shall be given to the insured by certified mail.
The provisions of this chapter shall not be deemed or construed
to alter or impair the right of the City to acquire or enforce any
lien against property but shall be in addition to any other power
provided by law to acquire or enforce such right.
Whenever the proceeds of a policy of fire insurance will be or have been paid to the City instead of an insured, all or part of such proceeds may be paid or released to the insured if the insured satisfies to the enforcing officer that the affected premises have been or will be repaired or restored or demolished with all debris removed, that such repairs or restoration or demolition are in the public interest and that the insured is issued and complies with an agreement entered into pursuant to this chapter. To secure such payment or release of proceeds, the insured must notify the enforcing officer within 45 days after the mailing to the insured of a notice of the service of the certificate of special lien pursuant to §
169-3 of this chapter of the intention to restore or repair or demolish with all debris removed the affected premises and must file with the enforcing officer a completed application with all required supporting documentation pursuant to §
169-6 of this chapter within 60 days thereafter, unless the enforcing officer grants an extension for a stated period of time.
The release or return to the insured of any amounts to which
he or she or it would otherwise be entitled to claim shall be subject
to the following conditions:
A. Such release or return shall be subject to the repair or restoration
of the affected premises, in accordance with applicable building laws,
to the condition it was in prior to the time the lien of the City
arose or to an improved condition or demolished with all debris removed.
B. The insured shall file with the enforcing officer an application
in affidavit form with such supporting documentation as the enforcing
officer shall require containing the following:
(1) A complete description of the nature and extent of the damage to
the insured premises and of the condition of the premises prior to
the time the lien of the City arose.
(2) A complete description of the nature of the repairs or restoration
or demolition to be undertaken and the cost thereof.
(3) A statement as to the source of funds needed to complete such repairs
or restoration or demolition if the insurance proceeds are not sufficient
therefor.
(4) The name and address of each contractor who will effect such repairs
or restoration or demolition.
(5) An estimated time schedule showing how long the repairs or restoration
and each phase thereof will take.
(6) Such other information as may be required by the enforcing officer
to enable him or her to determine whether the repairs or restoration
or demolition are in the public interest and will be or have been
timely and properly made.
C. Upon preliminary approval of an application by the enforcing officer,
the enforcing officer may enter into a written agreement with the
insured, in a form approved by the City Attorney, which shall set
forth the terms and conditions for the release and return of all or
part of the proceeds, and the enforcing officer is hereby authorized
to enter into such agreement on behalf of the City.
D. The repairs or restoration or demolition required by the enforcing
officer shall be completed in compliance with the terms and conditions
of the agreement prior to the release or return of any part of the
insurance proceeds; provided, however, that the enforcing officer
may, upon written request of the insured and in his or her sole discretion,
approve a prior release of such proceeds or a portion thereof in a
lump sum or in installments, where the insured certifies and demonstrates
that such release is required to permit such repairs or restoration
or demolition to go forward. Any such insurance proceeds released
or returned prior to the completion of the repairs or restoration
or demolition required by the enforcing officer may be paid directly
to the contractor or contractors responsible for making such repairs
or restoration or demolition. Such payment shall, to the extent thereof,
release the enforcing officer from further liability to the insured.
E. Whenever the enforcing officer releases the entire amount of the
proceeds prior to compliance with the terms and conditions of agreement,
the insured shall post a bond in an amount sufficient to assume the
restoration or improvement of the property.
If the insured fails to notify the City of his or her or its intention to repair or restore the affected premises as required in §
169-5 of this chapter or fails to file a completed application pursuant to this chapter or fails to enter an agreement with the enforcing officer or comply therewith within the time set forth, the right of the insured to assert a claim against the insurance proceeds, except to the extent they exceed the amount of the lien, shall terminate.
There shall be established in the office of the City Chamberlain
a fund for the deposit of fire insurance proceeds to be held and applied
in accordance with this chapter. Such funds shall not be held together
with the general tax levies in the general fund.
Until such termination, any insurance proceeds received by the
City shall be deposited in a special fund and shall be retained therein.
Upon termination of the insured's right to claim against the
proceeds, the proceeds and any interest accrued thereon shall be applied
to the liens affecting the premises in a manner to be determined by
the enforcing officer and may be transferred to the general fund.
The lien or liens against the affected premises upon which the
special lien against proceeds is based shall continue in full force
and effect, except to the extent that such lien or liens are or have
been paid.
Any agreement entered into by the enforcing officer pursuant
to this chapter shall be for the purpose of preserving and evidencing
the right of release of the special lien created by this chapter and
shall be subject solely to the provisions of this chapter. Any repair
or restoration or demolition performed in anticipation of a release
of insurance proceeds shall not be deemed to be a public work or municipal
project or to have been done pursuant to a municipal contract.
In the event of a loss which is subject to this chapter, it
shall be the duty of the Code Enforcement Officer, and in lieu thereof
the Mayor, to promptly notify the owner of the applicability of this
chapter. Nevertheless, failure to notify the owner shall not affect
the applicability of this chapter.
The enforcing officer shall be empowered to promulgate rules
and regulations, in consultation with the City Attorney, and to adopt
approved forms to be used by applicants.
Violation of this chapter shall be punishable by fine or imprisonment
or both as prescribed by the City Code. Each separate violation shall
constitute a separate additional offense.