can a company use a state or town's name on its product ex. "texas soft balls" with out paying or trade marking the name?
Yes -- no state or municipality has any trademark rights in its name as it is outwith the federal trademark law. However, be careful about a false designation of geographic origin -- states get VERY huffy about things like Idaho potatoes, Washington apples, as they sink a lot of money into promoting their origin as being tied to the best of a kind of produce.
Best wishes,
LDWG