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Home warranty fliers confuse residents in 1 Arkansas city

by Karl Richter Texarkana Gazette | October 30, 2017 at 4:30 a.m.

TEXARKANA -- A sales pitch for a plumbing warranty that appears to be from Texarkana City Hall is arriving in Arkansas-side residents' mailboxes.

But Texarkana's mayor said people should research the proposal and that there is no obligation to purchase coverage.

The letter is the result of an agreement between Texarkana and Service Line Warranties of America approved in May by the city's Board of Directors. The contract lets the private company use the city's name and logo on its marketing materials for a license fee of 50 cents per month per warranty sold to a resident.

The Texarkana, Texas, City Council approved an identical agreement with the company in April. Similar letters will be sent to Texas-side residents by Thanksgiving, city Communication Manager Lisa Thompson said.

The offer promises to cover the cost of any needed repairs to a home's external water lines -- the outside pipes that run from a Texarkana Water Utilities main to a house at a cost of $5.33 per month. Service Line Warranties of America also offers warranties for external sewer lines and in-home plumbing.

"This program is administered by [Service Line Warranties of America], and no public funds were used for the mailing of this letter," the recent letter from Service Line Warranties of America to Arkansas-side residents states. Under the heading "Important Questions & Answers," it also makes clear that "[Service Line Warranties of America] is an independent company, separate from your city, local utility or municipality."

But the letter is printed on what resembles official city letterhead, featuring the city logo and printed signature of Texarkana Mayor Ruth Penney Bell. "Important Information for City of Texarkana Homeowners" is printed at the top of the first of two pages.

Penney Bell said the letter is not exactly what she had expected and she is concerned that it implies more endorsement on the part of the city than was intended.

"This was not presented as I had heard it when I was initially exposed to it. This is not the same wording," she said. "All they had told me was that they would like me as the mayor to say that it had been looked at by the city and approved, and that was it."

A Service Line Warranties of America official did not return a phone call seeking comment.

Penney Bell took responsibility for any confusion that may occur, saying she suggested inviting the company to make a presentation to the Texarkana Board of Directors after seeing it make one at an Arkansas Municipal League executive meeting last year.

"Several mayors stood up and said, 'This is the best kind of insurance we've ever seen. Our citizens love it, especially people in older homes.' ... I did not think that I was doing anything improper or endorsing anything that would be questionable," she said.

Texarkana Water Utilities has fielded some phone calls from customers who did not understand that the warranty is not being offered by the utility, Administrative Coordinator Pam White said. Some thought buying a warranty was something they had to do and were worried that their water bills would automatically be going up. One person mailed a payment for the warranty to the Texarkana Water Utilities offices.

Penney Bell said that kind of misunderstanding is what worries her most about the situation.

"I don't want anyone to believe that our city or water department is asking for $5 a month," she said.

Penney Bell advised residents to check with their insurance companies to see whether external water lines are already covered. People should consider the warranty offer carefully, she said.

"I want them to look at it," she said. "If they think this is something they could use that would give them a little more security, fine. But not to think that we're endorsing it. All we wanted to do was make something available maybe to those people who don't have homeowners insurance."

Metro on 10/30/2017

Print Headline: Fliers confuse Texarkanans; Mayor says home warranty offers come from firm, not city


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