[Briguy]

I would drill it out with a 3/8" bit. Only go in about 3/4 inch into your transom. This will allow any more water to come out for shore. If the rest of the transom is dry and solid then just prep the hole after sufficient drying time and epoxy it. If you are really worried, you could drill 2 or 3, 1/4 inch inspection holes an inch or two below the wet area for peace of mind. If they are dry, you are out of the woods, if they seep, you might still be ok, if water squirts out; well let's not get ahead of ourselves. Try it and get back to me.