BANGOR – The trustee of the bankrupt Bangor and Aroostook Railroad estate has reached a financial settlement with 19 towns that were owed back property taxes.

The agreement was not easy to reach, and took months of negotiations that included Gov. John Baldacci and his office’s attorney, Kurt Adams. U.S. Bankruptcy Chief Judge James B. Haines Jr. approved terms of the settlement Wednesday.

In court documents, Andrew Sarapas, an attorney for trustee James B. Howard, said that “although the decision to settle was not easily made by the towns,” they “ultimately recognized” that decisions in other railroad bankruptcy cases would bolster the trustee’s case if he pursued legal action to lower their tax payments.

The settlement takes the place of any tax liens or tax assessments before Jan. 9, the day the railroad was sold to Rail World Inc., a Chicago-based consortium, and renamed Montreal, Maine and Atlantic Railway.

Under the terms of the settlement, the town of Hermon, where B&A Railroad was headquartered, would be paid $323,820. The town was owed $404,575, according to court documents.

The 18 other towns will split $452,369. They were owed $572,619, according to court documents.

The $201,305 difference between what was owed the towns and what they are being paid represents property that is held by various estates under the railroad’s Chapter 11 bankruptcy proceeding and will be retained by them free and clear of all liens and claims.

The 18 towns are Patten, Eagle Lake, Chapman, Portage Lake, East Millinocket, Glenburn, Mapleton, Medford, Hampden, Easton, Van Buren, Bangor, Caribou, Millinocket, Presque Isle, Brownville, Houlton and Milo.