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Berkshire St, the main arterial road leading into Arrowtown from Malaghans Rd and the Arrowtown-Lake Hayes Rd, is due for an upgrade.
The Queenstown Lakes District Council's utilities committee this week approved the design concept for the changes to Berkshire St.
The main part of the project will be pavement rehabilitation of the entire stretch from Malaghans Rd to Durham St. Drains along the street will be cleaned out and improved.
The street will be widened slightly in some areas, but QLDC project manager Steve Hewland said the avenue of trees along Berkshire St would not be touched.
An arborist would be on site to monitor and advise when work was taking place near the trees.
The plan also includes improvements to the Berkshire St-Caernarvon St intersection, which has been identified as an accident black spot after reports of one serious injury and four minor injuries in crashes at the intersection in the last five years.
"All the reported crashes were caused by vehicles on Caernarvon St failing to give way.
"The sight distances from this intersection are limited by the avenue of trees, and I am surprised there has not been more accidents there," Mr Hewland said.
Kerb "build-outs" in schist will reduce the width of Caernarvon St, causing motorists travelling on Caernarvon St to slow significantly when they approach the intersection.
The project will cost an estimated $574,174. The majority of this amount ($532,287) is already set aside in the council's long-term council community plan, and the remaining amount will come from the budget for "minor improvements".