Council moves forward with voluntary water line warranty program

Following council member concerns over the City of Newton potentially taking 10 percent royalties from the premiums collected in a voluntary water line warranty program, staff met with the company providing the services and presented officials with a new contract devoid of any such revenue stream for the city.

Newton City Council decided earlier this month to table the city’s agreement with Utility Service Partners, a HomeServe company that partners with the National League of Cities to administer the warranty program. Council member Stacy Simbro suggested the 10 percent the city received should go back to citizens.

Essentially functioning as a voluntary insurance program for residents, the program does not cost the city any money to be apart of. But it does require a marketing agreement be made with the city so that Utility Services Partners can have access to City of Newton’s branding when sending letters to residents.

All letters must have the approval of the city before being sent to residents.

Newton City Administrator Matt Muckler told Newton News that there are two different kinds of contracts offered to cities for this program. The contract that is normally proposed to cities is the one in which a municipal gains access to an extra revenue stream. The council decided on the royalty-free agreement.

“So now the amount they charge the residents will be less for the same amount of coverage, because the city is not taking an additional revenue,” Muckler said.

Ultimately, the discount to residents amounts to $0.50 in savings per month. Three kinds of services are provided by the program: exterior water service line ($7.49), exterior sewer service line ($12.49) and internal plumbing and drainage ($12.49). There are no service fees or deductibles or annual or lifetime limits.

When the city was first discussing the idea of the water line warranty program, it was proposed the extra revenue stream could be used for a hardship fund. It would have been used for individuals who are at a lower income level and may encounter more difficulties paying for water line or sewer line repairs.

Discussions at council meetings have covered all kinds of water issues faced by residents. Muckler emphasized the water line warranty program does not address stormwater, but rather water lines and sanitary sewer lines. With the program now approved, residents can decide now whether they want to sign up.

According to city documents, the program helps the city achieve its 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.

• Using fully vetted local contractors to complete the repairs.

Muckler said residents should understand that HomeServe is a company that is involved with the water line warranty program and also Black Hills Energy. But the programs they offer are different. The city administrator encouraged citizens to understand the differences between those two programs.