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Staff Writer

TOWNSEND — Outstanding taxes owed to the state may delay the final purchase of Witch’s Brook Water Company by the town.

Town treasurer Kathleen Rossbach and town clerk Dan Murphy presented paperwork to the Board of Selectmen to request $359,409.47 to purchase the Witch’s Brook Water Company. The bond will have 3.95 percent interest for one year, and go to bid next year for a different rate.

Witch’s Brook supplies water to Townsend resident’s in Timberlee Park. Townsend officials have been working toward the acquisition of the company for several months since they became aware of it being for sale in the spring.

Selectman David Chenelle said he was hesitant to sign the document since he had received multiple e-mails from town counsel warning of possible extra costs to the town.

“The issues that I saw reflected were whether or not Witch’s Brook was actually marketable, because there’s apparently some outstanding state taxes that may affect the purchase price,” said Chenelle.

Town counsel warned that the seller’s attorney told the town they were unable to provide a Certificate of Good Standing from the Department of Revenue for the closing date on July 27. Since the town is purchasing all of Witch’s Brook assets, it could be responsible for paying any taxes owed, if they are not negotiated with the seller.

“We know that there’s some outstanding tax, but we don’t know how much it is or what we actually need to take to correct it,” said Chenelle. “Right now, I personally am not willing to sign that unless we have a set figure from the town counsel to see what’s due on the state tax.”

Murphy and Rossbach, who had not received the e-mails from town counsel, clarified that the paperwork was just to request the funds and wasn’t a transfer.

“What happens if we sign this tonight and on Friday it’s decided that it’s no deal. Can we get our money back?” asked Selectman Denig.

Rossbach said the request for funds didn’t commit the town to spend them, if the purchase were to be delayed or entirely fall through. The sale is expected to close on Friday, July 27.

Hearing that, the selectmen signed the paperwork for the funds. Selectmen also agreed that they would express their concerns to the Townsend Water Commissioners before the final agreement was signed.