Calderdale Council Cabinet on Monday night, agreed to repair the road - which runs along the front of Central Street Infant School just behind Market Street - but only if the majority of nearby shops and homeowners put up cash in advance by the end of September.
"It is an absolute disgrace that Central Street, in the middle of Hebden Bridge should be left in this condition for so long," said Coun Barry Collins
"Everyone wants it to be made up because apart from anything else, it is crucial to the feel and ambience of this market town," he said.
Calderdale Council has already earmarked £20,000 towards repairing Central Street and the surrounding areas of, Pitt Street, Fielding Street and Hilton Street and Hebden Royd Town Council has set aside £30,000. In principal, Central Street Infants School has allocated £20,000 and the Co-op supermarket upto £10,000 which leaves residents to find around £20,000 for the estimated £100,000 scheme to go-ahead.
Coun Craig Whittaker said there were 1,600 unadopted streets in Calderdale and repairing this one could set a precedent. "In these hard economic times, I would not want the council to impose a charge for the work on nearby property owners," he said.
Coun Nader Fekri said: "The situation in Central Street is almost unique and so no precedent would be set and recently Calderdale Council had adopted a road in Mytholmroyd anyway.
"The Town Council has managed to gained the support of all property frontagers for the work to be undertaken and we were asking for the charge to be put on the properties on sale."
But council leader Stephen Baines said providing the majority of properties fronting the street "paid up front" the council would undertake the work.
After the meeting Coun Fekri said: "I am glad that cabinet have seen sense over the issue and agreed with the majority of residents, parents and children of the school, the Town Council and all three ward councillors.
"This will be of benefit to everyone in Hebden Bridge and Calderdale as a whole. At the moment it is not only unsightly but physically hazardous with pot holes several inches deep and children frequently stumble and fall."
Calderdale Council's Cabinet member for regeneration and development, Coun Amanda Byrne, said: "When Cabinet made its original decision in October 2008, members were clear that they would not support any scheme which would lead to a charge being imposed on people's property, particularly in the current economic climate.
"However, it appears that the non residential frontagers, who form a significant part of the scheme, may now be willing to provide up front funding.
"Therefore once this evidence is brought to Cabinet then I see no reason why full support of this scheme should not be fully supported. It will greatly enhance the appearance of the area, promoting a sustainable heritage, and support what is a vibrant market town."
Mayor of Hebden Royd, Coun John Beacroft-Mitchell said: " We are cautiously optimistic that the scheme will go ahead. Hebden Royd Town Council has been more than willing to allocate a large proportion of it's budget and years of officer time to getting the Central Street area up to a standard fit for the centre of our town. It is encouraging to see Calderdale Council rise to our challenge and hope they will live up to their commitment in the near future," he added.