The First Parish Congregational Church has agreed to accept a town proposal to lease and house Gorham’s town clock for 99 years. The lease is for $1 a year.

Mark Faunce, church moderator, said Tuesday the church membership accepted the offer on Sunday. Faunce said the Rev. David Butler, senior pastor at the church, hand-delivered a signed letter to the town Tuesday confirming acceptance.

“We’re very pleased,” Faunce said.

The clock was a gift from Toppan Robie, a leading Gorham citizen and community benefactor, in 1868. Clockworks had turned hands on four faces for 138 years in the steeple at the church until last fall, when the town had it removed for repairs.

The future location of the clock had been clouded by a concern over separation of church and state after taxpayer money was allocated for restoration. The town set aside $75,000 in a clock account to cover a variety of options, but just restoration of the clockworks is expected to cost about $38,000.

The town council proposed the lease arrangement to the church earlier this month and the deal hinged on approval by church membership. A previous attempt to locate the town clock in the municipal center failed in a deadlock council vote last month.

A generous gift resolved the problem, clearing the way for the clock to be returned to the church. Gorham residents John and Rosamond Phinney, members of the church, are donating the $38,000 to the church to reimburse the town for repairing the clock.

Faunce said the church has formed a subcommittee to plan where the clock would be placed in the church. The two options are the vestibule or a former organ chamber in a lower portion of the steeple. The clock had been 65 feet above the street in the steeple and once tolled the church Paul Revere bell.

The town council wants the clock to be available for public view. The church has a month to formulate a plan and present it to the town council, Faunce said. He said the church hopes the clock would be reinstalled by the end of the year.

Faunce said there’s a “fair amount” of work to be done to ready a space for the clock in the church. A shaft up through the steeple would be needed to turn the hands on the clock faces.

The clock was manufactured by the Howard Clock Co. of Boston, and is considered priceless. It is now in the hands of Balzer Family Clock Works in Freeport, where it is being restored. Restoration was 90 percent completed a month ago. Faunce said the company would have the clock ready to return with 10 days’ notification.

Under terms of the lease from the town, the church would have to insure the clock and pay for annual maintenance.