Plano Continues Controversial Utility Program

Plano homeowners can soon expect another round of letters promoting sewer, water line insurance

By Catherine Ross
|  Friday, Sep 14, 2012  |  Updated 7:28 PM CDT
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Plano is getting backlash from residents who want to know why the city is partnering with a private company to insure sewer and water lines running to their homes.

Catherine Ross, NBC 5 Collin County Reporter

Plano is getting backlash from residents who want to know why the city is partnering with a private company to insure sewer and water lines running to their homes.

A program that provides utility warranties for sewer and water lines on private property is expanding despite some public skepticism.

Earlier this year, Plano sent out letters that offered homeowners the option to purchase coverage for the sewer and water lines, which usually run underneath a home's front yard, that connect into the municipal system.

Repairs to those lines generally are not covered by homeowners insurance.

Gloria Meir's said she did not purchase coverage.

"I just was cautious in, what Plano was doing by promoting this?" she said.

Brian Davis, who works for Utility Service Partners Inc., said such reactions are typical, although the response in Plano was unique.

"I'vie never seen quite the negative attention as we had in Plano," he said.

Utility Service Partners offers the type of coverage in about 150 cities across the country.

Meir's said she and others were confused about why a public municipality would license its name to a private company.

More than 7,000 people eventually signed up for the warranties, but some discontinued their policies during the height of the debate this spring.

However, Plano is continuing its commitment to the program. The city sees it as an alternate revenue stream, a way to bring in money without raising taxes or fees.

The partnership gives the city 12 percent of the royalties for the use of the city's name in recruiting new customers.

This month, Plano homeowners can expect a new round of letters in their mailboxes promoting water line coverage.

"Four months into it, the numbers show for themselves," said Davis, referring to what he hopes is future success in Plano. "The second round is always much smoother."

Coverage begins at about $5 per month.

Both the city and the warranty provider emphasize the policies are completely optional.

Utility Service Partners often sees a 20 percent participation rate in other member cities in North Texas, Davis said.

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