I have been contacting my borough, police department, council members, mayor, fire marshal about the abandoned house next door for years. The house has been broken into hundreds of times. I have had mice, rats and a bat in my house and could never get the borough to do anything. I have been on record for years about this. I have been afraid that someone would break in and burnt he house down and my biggest fear happened on December 7, 2013 and someone set in on fire. I am lucky to get out of my house as my neighbor saw the smoke and got me out. I have damage to my house and had to be out of it for days. This house was to be tore down years ago by the borough but they did not take care of this. Also, the mortgage company owns the house. The sheriffs dept said to send a letter of intent.
It sounds like you have claims against either the borough or the record owner of the house, or possibly both. You will want to be certain who, exactly, owned it at the time the fire occurred, as well as who had care, custody and control of the property. Be advised, suing a municipality is different than suing a person or corporation. For starters, what the officer told you was correct: to sue a municipality in Pennsylvania, you have to send a "letter of intent" within six months of the event or cause of action. Consult a local attorney who is familiar with municipal law.