Thanks Rick but have checked the heater and working just fine. The flapper (damper door) was the problem as it was warped and not sealing the opening of the chute in the door. Cost of new flapper was very inexpensive (less than $10.00) especially when I still have my G.E. discount.
Just as an FYI, my water line issue ending up being a faulty freezer defrost element resulting in iced over coils - which in turn froze water line. Replaced defrost element and we got water back with the coils no longer frozen over.