The Coastal Highway will see various improvements made to the A158, the main link road from Lincoln to resorts like Skegness.
The route is subject to long delays - especially during the during the summer - and one of the most notorious bottlenecks junction of the A158 and A153 in Horncastle.
Residents, town councillors, MP Victoria Atkins and several other political figures have been calling for a bypass for many decades.
They claim it would end the traffic jams and attracting new businesses, delivering a boost to the local economy.
However, while the County Council has confirmed the funding pot, it stresses there is no provision for a bypass.
The £6.5m figure - and other information - is included in an email sent by County Councillor Hugo Marfleet to Belchford resident David Perrin who is campaigning for a reduction in traffic through his village
Mr Perrin believes delays on the A158 are causing more vehicles to use rural back roads, leading to safety and speed issues.
Coun Marfleet said that in 2018, the council put forward a series of improvements and added three additional projects - a Horncastle bypass, a Skegness Relief Road and pedestrian crossings in Wragby.
Coun Marfleet goes on to state: “The Horncastle bypass concept paper was completed which identified expected costs and benefits.
“Due to the Department for Transport scoring mechanism, the benefits are very low in comparison to the cost and therefore would not attract any central government funding.
“This project is therefore currently not being progressed but is included in the council’s pipeline of projects to consider in the future.”
Coun Marfleet reveals a Skegness Relief Road would attract a relatively high ‘benefit to cost ratio’
A Skegness Relief Road concept paper has also been completed which indicates a route that attracts a relatively high ‘benefit to cost ratio’ - meaning it may attract third party funding.
He adds: “Following the announcement of a Coastal Highway budget allocation a programme or works are being developed over a number of years.
“Approximately £6.5m has been allocated to date, towards various improvements along and around the Coastal Highway.
“ This includes carriageway reconstruction, carriageway resurfacing, guard rail replacement, white lining and new/improved pedestrian facilities.”
A new pedestrian crossing has been provided on the A158 in Wragby - another ‘hot spot’ for delays.
However, that has sparked complaints in Horncastle where calls for a pedestrian across on East Street (A157) crossing have fallen on deaf ears.
Meanwhile, Coun Marfleet assured Mr Perrin - and many rural parish councils concerned about increasing traffic volumes - he will continue to ‘keep pushing’ for road improvements and repairs.
There are increasing concerns that delays on the A158 - and satellite navigation systems - are adding to traffic volumes in villages.
Town councillors have indicated they will be lobbying for some of the funding to be spent on improvements to the A158 through Horncastle - including pedestrian crossings.