A Picton overbridge being built to keep traffic flowing when larger ferries brought more vehicles into town has been parked and it's unclear if it will ever be built.
Dublin Street had been closed since August for construction of the overbridge, as part of the multibillion-dollar Inter-island Resilient Connection (iReX) Project to introduce new, larger ferries. The government pulled funding from the project in December.
KiwiRail iReX programme director David Warburton said while the organisation continued discussions with New Zealand Transport Agency Waka Kotahi (NZTA), it had made the decision to reinstate the level crossing at Dublin St.
It meant the community could use the road, while decisions were worked through about the future of the roading network, Warburton said.
"Dublin Street will reopen in two phases, with work starting after Easter to reopen the street west of Market St, including Market Street and the side streets.
"East of Market Street will come second. We don't have firm dates but are working to do this as quickly as possible, however it does rely on the availability of specialist equipment."
Warburton said KiwiRail was working with the council and NZTA on how the Broadway intersection in Picton would be left moving forward. Broadway was planned to become a cul-de-sac instead of crossing the railway.
"We are also working with Port Marlborough on the best options for the old terminal buildings and the new temporary terminal and we are completing the Waitohi Awa Culvert strengthening work."
Marlborough Mayor Nadine Taylor said KiwiRail's decision to reopen Dublin Street would be "welcome news".
"The Waitohi Picton community who have been and continue to be disrupted by the iReX project works will be pleased to hear that KiwiRail has confirmed Dublin Street will be reopened," Taylor said.
"This is a good outcome for the local community until a longer-term decision is made about the future of the roading network in the town."
Finance Minister Nicola Willis announced in December she had declined to provide $1.47 billion to continue the project.
Originally, when it was announced in 2020, the work was expected to cost under $1b. On Wednesday, Willis said the latest briefing indicated it would cost $3b. She described it as a "massive cost blowout".
The iReX project would have transformed the Interislander fleet, with two new rail-capable, low-emissions ferries and new terminal infrastructure in both Wellington and Picton.
The first new ship was meant to be launched in January 2025.
LDR is local body journalism co-funded by RNZ and NZ on Air.