MONTPELIER, Vt. — A company that owns a Bennington factory has agreed to pay for a $20 million public water line extension to about 200 homes in an area where some private water supplies are contaminated with the chemical PFOA, the state of Vermont announced Tuesday.

The settlement between the state and Saint Gobain-Performance Plastics covers parts of Bennington and North Bennington in the southwestern part of the state.

Construction will begin this year to extend municipal water lines to homes where private wells were found to be contaminated. No contamination has been found in the public water systems in the area.

Bennington Town Manager Stuart Hurd said only some of the homes have contaminated water. All people in the area are going to be hooked up to the municipal water system, regardless of whether their wells are contaminated.

The state says Saint Gobain has also agreed to continue investigating possible contamination in other nearby areas. Once that investigation is complete, the state will seek a similar funding agreement from Saint Gobain or any other group found to be responsible for the contamination.

Hurd said the town and many members of the community were pleased with the settlement, but more needs to be done.

“Yes, we’re halfway home,” Hurd said. “The next half will be, perhaps, more difficult.”

There is a long-closed landfill in the area still under investigation. Scientists have not been able to determine if some of the PFOA contamination found in that area — which has perhaps another 200 homes — could have come from the landfill, Hurd said.

Saint Gobain President Tom Kinisky said the company’s willingness to fund the water line extension shows its commitment to resolving the issue.

“Providing potable drinking water to citizens of Bennington and North Bennington has always been our shared goal,” Kinisky said.

PFOA, or perfluorooctanoic acid, has been linked to certain types of cancer. For decades, the water and oil repellent was used in products including non-stick cookware, stain-resistant carpeting and microwave popcorn bags. Manufacturers agreed to phase it out by the end of 2015.

In Vermont, PFOA was used at the now-closed Chemfab plant in North Bennington. The plant, which made fabrics, is now owned by Saint Gobain.

Saint Gobain had previously provided bottled drinking water to affected homes and filters for home water systems.

Jim Sullivan and his wife built a home in the affected area in 2008. Tests have consistently found elevated levels of PFOA in their water.

“My wife and I have been living on bottled water for a year and a half,” Sullivan said Tuesday. “It’s welcome news that they’ve finally come to a settlement agreement.”

Vermont officials began testing private wells in the North Bennington area in early 2016 after the chemical was found in the water supply in nearby Hoosick Falls, New York. In the New York community, PFOA was found in the municipal water system, more than 800 private water wells and a public school.

In New Hampshire, PFOA and similar chemicals have been found in a number of homes in about a half dozen communities in the southern part of the state. So far a number of homes in those communities have been connected to public water supplies, while others are in the works.