Unsure of whether the city could add an amendment to its new agreement with a company who could provide service line warranties for residents, the Newton City Council opted to table the item at the Aug. 5 meeting until officials know for sure if they can redistribute the 10 percent cut the city receives from the premiums.
Newton News previously reported about a presentation during the July 15 council meeting that proposed an optional program for citizens experiencing water line and sewer line issues. For a monthly payment, residents would be protected up to a certain amount for each external water/sewer line or plumbing incident.
Essentially functioning as a voluntary insurance program for residents, it would not cost the city any money to partner with a company. In fact, it would add a small revenue stream. The city’s portion of the premiums could go directly into the general fund or help larger water line issues. But officials were skeptical.
Council member Stacy Simbro suggested the agreement be amended so that the 10 percent the city makes from paid premiums would be refunded to the citizens or be used as a discount. Council member Steve Mullan agreed with Simbro’s idea, saying the city should not be making money off this program.
Jody Rhone, utilities director for the City of Newton, was brought forth to provide any insight about the agreement and whether it could be amended. Although Rhone reached out to Utility Service Partners, Inc., a HomeServe company, he did not have any answer. He suggested it could be tabled until he knew for sure.
Rhone said when it was discussed during the July presentation, it was proposed the premium cuts could be set aside for extreme hardship cases or for low- to moderate-income families and their water line issues. Simbro liked that idea but it still felt like it would be coming out of the pockets of residents buying the policy.
The motion to table the agreement passed in a 5-1 vote, with council member Joel Mills voting no. According to city documents, the agreement is largely a marketing agreement allowing Utility Service Partners access to the city’s branding when sending city-approved letters to residents about the program.
Which is largely how the program is implemented. Residents can enroll via mail, phone or web. Utility Service Partners handles all customer billing. Residents can choose to have annual, quarterly or monthly billing, and they can pay by check, direct debit or credit card. The city’s agreement would initially last three years.
The service line warranty program was conceived in partnership with the National League of Cities to educate property owners about their service line responsibilities and to help residents avoid the out-of-pocket expense for unanticipated and potentially costly service line repairs and replacements.
For Newton, this accomplishes a number of goals by:
• Providing homeowners affordable protection against significant and unexpected costs to remedy leaking/broken/clogged water lines, sewer lines and in-home plumbing lines.
• Ensuring the delivery of timely, high‐quality repair services in adherence to all applicable codes.
• Providing exemplary service that reflects positively on the city.
• Generating an ongoing, sustainable source of revenue for partner municipalities.
• Stimulating the local economy by using fully vetted and local contractors to complete the repairs.
Three kinds of service are provided by the voluntary warranty program: exterior water service line ($7.99), exterior sewer service line ($12.99) and internal plumbing and drainage ($12.99). There are no service fees or deductibles or annual or lifetime limits. Residents can cancel warranties at any time.
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