Construction on Tyrrell Street Bridge began on Monday, in an effort to reduce the impacts of flooding in Wallsend.
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The work, which marks the first step in a wider plan, will see the bridge and its supporting pillars removed and replaced with a single-span overpass above the existing stormwater drain.
Member for Wallsend Sonia Hornery welcomed the project but said it had been a long time coming.
"It has been more than 12 years since the Pasha Bulker storm decimated the Wallsend CBD," she said. "This is a great day - one I often thought I might never see."
Bridges over Nelson and Boscawen streets are also in line for replacement as stormwater drains throughout the Wallsend CBD are widened, Ms Hornery said.
"Thankfully the City of Newcastle has stepped up and was willing to put up the money to replace the bridge.
"Despite pleas from council, residents and businesses, the State Government has refused to contribute a single cent towards any of the works required," she said, and called on the state Planning minister to support the city and Hunter Water to deliver the works.
"It's time to get this done for the people of Wallsend" Ms Hornery concluded," she said.
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