South Holland District Council has formally accepted £224,000 of money from central government to help fund a major infrastructure development in Spalding.
Councillors agreed to accept the grant for the Northern Spalding Sustainable Urban Extension at a full council meeting on July 26.
The funding will be used to support the development of design work for the northern phase of the Spalding Western Relief Road, which is designed to support the town’s predicted housing growth over the next two decades.
Councillors also agreed to support the project with £100,000 from the council’s growth budget.
A public consultation is expected to be held in spring 2018.
Councillor Nick Worth, portfolio holder for growth and commercialisation at South Holland District Council, said: “This is very positive news for Spalding and the district so I am delighted we were successful in our bid.
“Although the project is in the very early stages I am excited by such huge potential of this development.”
Lincolnshire county councillor Richard Davies, responsible for highways at the authority, said: “This is an important step towards a relief road for Spalding, providing a new route around the west side of the town.
“This is particularly needed as we expect there to be an increase in rail freight passing through the town in the coming years, meaning that the barriers are down for longer at level crossings.
“This new road will help reduce the delays stemming from this and cut congestion in the town centre, improving journey times for motorists.
“It will also help drive economic growth in the area. We’ll continue to work closely with our partners to take this project forward.”