Dallas Can't Get Out Of Contract To Sell Logo
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DALLAS (CBSDFW.COM) -- Dallas city leaders met behind closed doors Wednesday to reconsider an agreement that allows a Pennsylvania based company to pitch sewer line insurance—with a letter bearing the city's logo.
But, it appears that the council is locked in. The contract with Service Line Warranties extends through April 2016. Councilmembers plan to reconsider the agreement with a vote in August.
Although the letters look legitimate and the process is legal, many homeowners have complained that the solicitation letters are misleading.
"If someone gets a letter from the city of Dallas or with the logo of the City of Dallas on it, there is an implicit understanding that this is perhaps a directive from the city or certainly an endorsement," says Michael Braun.
Braun is a marketing professor at SMU's Cox School of Business. He's also a Dallas homeowner. And yes, he has already received a solicitation letter from the company.
"My first reaction was `I can't believe the city is endorsing this'," says Braun.
According to Braun, assurances in the letter that the policies are optional are often lost. "The legal doesn't really matter—people are going to act based on what they think the city's involvement in this is."
Officially, the city's involvement is to allow the use of the logo in exchange for a fee. Company officials staunchly today defended the product as a win for the city and homeowners. The policies cover breaks in sewer lines that cross private property and are not the responsibility of the city. So, why pay to use the logo?
"Without the logo, people simply don't open the letter," says Brian Davis, a General Manager with Service Line Warranties. "They don't take this opportunity seriously and they will not enroll."
Davis touted similar arrangements with cities across the country—but, a quick internet search also found similar controversies from Albuquerque to Ft. Lauderdale.
Plano entered into an agreement with the company three years ago. According to a city spokesperson, a lot of confusion followed with homeowners there also wondering if the official looking letter suggested the policies were required. The Plano city council revisited the arrangement in December and voted to keep it. Still, many in Dallas are anxious for it to go away.
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