Pursuant to Section 508 (B)(1)(I) of Act 98 of 1992, the Treasurer issues a certificate indicating that there are no delinquent taxes, assessments, penalties or user charges against real property, the insuring agent shall pay the claim of the named insured, provided however, that if the loss is agreed upon by the named insured and the insuring agent equals or exceeds sixty percent (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 City in the lesser of two thousand dollars ($2,000) for each fifteen thousand dollars ($15,000) of a claim or the estimate amount less than the amount calculated under the foregoing transfer formula.
(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 City from the insurance proceeds the amount specified in the estimate.
(c) The transfer of proceeds shall be on pro rata basis by all insuring agent's 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 City in excess of the estimate to the named insured, if the City has not commenced to remove, repair or secure the building or other structure.
(e) Upon receipt of proceeds under this section, the City shall do the following:
(1) The Treasurer shall place the proceeds in the 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 City. Such costs shall include, without limitation, any engineering, legal or administrative costs incurred by the City 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 City 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 City 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 City and the required proof of such completion received by the Building Official, and if the City has not incurred any costs for repairs, removal or securing, the fund shall be returned to the named insured. If the City 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 City shall transfer the remaining funds to the named insured.
(4) To the extent that interest is earned on proceeds held by the City pursuant to this section, and not returned to the named insured, such interest shall belong to the City.
(f) Nothing in this section shall be construed to limit the ability of the City to recover any deficiency. Furthermore, nothing in this subsection shall be construed to prohibit the City and the named insured from entering an agreement that permits the transfer of funds to the named insured of some other reasonable disposition of the damaged property has been negotiated.
(Ord. 24-1992 Sec. 1. Passed 10-6-92; Ord. 14-1994 Sec. 2. Passed 12-20-94.)