TOWNSEND -- If the proposed 2 1/2 mile rail trail becomes a financial risk for the town, selectmen say they will not support the project.

Cleanup costs for potentially contaminated areas along the proposed site are a major concern for board members and some residents.

The trail, if constructed, will run from the Harbor Village Shopping Center, near the Groton town line, west toward Depot Street in the town center.

The town is currently negotiating an agreement with the MBTA to lease the trails that would be converted.

"If there will be any costs to the town, all feasibility studies can stop now," said Selectman Maureen Denig. "The town has too many other financial responsibilities right now."

Last night, the board asked members of the Squannacook River Rail Trail Feasibility Committee, a private organization that has studied the project for the past three years, to address concerns of environmental liability and financial responsibility to the town.

"The idea is to construct the rail trail at minimal cost to the town," said Steve Meehan, chairman committee.

The committee plans to cover the costs of the project through federal and state grants and private funding.

But Meehan's comment sparked a debate among residents who were angered by the idea of spending any money on this project.

"We voted to go forward with this study because the project was originally presented as free," said John Beaulieu of 110 Main St. "The bottom line is the town does not want to spend money on this and it's obvious that this is going to cost the town money, so why don't we just stop this right here."

Resident Bob Shank said he is concerned about areas along the proposed site with known contamination.

"Who's going to pay for that?" asked Shank.

Steve Winslow, an environmental lawyer who has worked on numerous rails-to-trails projects across the state, said the town will not be liable. He discussed ways the town can protect itself from environmental liability, including the purchase, through private funding of environmental insurance.

The policy according to Winslow can be purchased for about $5,000 per year during a five-year period. It would require a $50,000 deductible per incident.

"The insurance policy covers unknown situations, but you can pretest and plan some fixes for pre-existing contamination into the lease agreement," he said.

According to Winslow, state General Law Chapter 21A provides exemption to the MBTA and cities or towns for liability on environmental cleanup once a lease is signed.

"Some towns, like Salisbury and Newburyport, have gone ahead with similar projects without purchasing the insurance just based on the new environmental liability exemption from Senator (Pam) Resor," said Winslow.