I think the money part of the article was probably a bit of Globe yellow press hysteria. Rockport isn't a poor town, they have $112K median income and a >$30M annual budget. From the article it looks like much of the current legal action/cost for this so far is in the MA AG's office anyway.

I currently live in a small town, and (though not on the ocean) we've been sued many times by rich snobs and others like developers, and have generally not had big costs defending (I think the record was someone claimed they spent ~$150K suing the town, insinuating in a public meeting that the town must be spending a similar amount defending. We actually spent ~13K defending and won.) My town's legal budget usually comes to around $30 per household per year, with probably half of that on contract negotiations and personnel issues, so not a huge burden.