Parts of College Road were closed in October.
Natural England previously said it issued the council with a licence on 13 October “to carry out this work ahead of the badger breeding season”.
The council said it then built an “alternative badger sett to allow repairs to go ahead”, but the badgers returned to their original sett.
Badger setts are legally protected and it is a criminal offence to interfere with one without government approval.
Waltham said the lifting of restrictions would make “a real difference” for residents of East Halton.
“This has never been just about a stretch of road. It’s been about residents facing long detours, farmers trying to run their businesses, and a community feeling cut off. Being able to get spades in the ground again is a crucial turning point,” he said.
According to the council, the existing road surface would be removed in February, with full reconstruction starting in the spring, meaning the road could reopen as early as May.
The spokesperson for Natural England said the body had “provided the necessary licence on time”, each time the council had applied.
“The licences enable the work to progress,” they added.
“We fully understand the difficulties the villagers were experiencing and are pleased the issues have been resolved.”