A Clutha District Council committee has recommended retaining the town's traffic flow along State Highway 1, Clyde St.
The decision was greeted with clapping at the meeting's public forum yesterday.
The council's district assets committee met to discuss the traffic flows and make a recommendation to the council, to be considered at its May 17 meeting.
The committee voted unanimously to recommend the council retain Balclutha's traffic flow.
Councillor Stewart Cowie said the decision was an easy one as the council had received a "pretty clear mandate" from its ratepayers. The majority of 769 submissions favoured doing so.
An overwhelming majority, 95%, supported the status quo, retaining the two heavy-traffic bypasses and State Highway 1 passing through on Clyde St.
Two-thirds of the submissions were from Balclutha residents.
Cr Gaynor Finch said the bypasses worked well, and she hoped the consultation process had brought businesses together.
Cr Chris Hargest said the main street was the "lifeblood" of the town and businesses needed certainty about traffic flows.
Balclutha resident James Creighton hailed the recommendation as "a triumph of common sense."
Mr Creighton said he was "definitely relieved and excited" following the committee's recommendation.
At the verbal submission hearing yesterday morning before the council's meeting in the afternoon, Mr Creighton said his wife Jo had recently opened a new shop on the main street, Clyde St.
"The location on State Highway 1 is vital to her business ... the majority of her sales are from passing trade."
Mr Creighton told the committee that, earlier this week, a prominent New Zealand author had driven through Balclutha, saw the boutique clothing store, stopped, bought nearly $1000 worth of clothes, and asked to be added to the store's mailing list - all because she drove past the store on SH1.
A $2.6 million main street upgrade has been budgeted for the next year. It was planned for the 2011-12 year but was deferred while the council completed consultation with the community and New Zealand Transport Agency about the traffic flow.