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One possible path for Lac Megantic new main street and bridge, next to the Centre Sportif on the north shore of the river, Tuesday, August 13, 2013.michel huneault

A plan to dramatically reshape Lac-Mégantic is gathering speed and local leaders are preparing to cut the ribbon on a new main street in October, reconnecting a town shattered more than a month ago.

For the 125 businesses displaced by the July 6 derailment and explosion of a train carrying crude oil, the move will be permanent.

Two blocks from the main thoroughfare, a new downtown will be driven through forests and mud and across a planned bridge over the narrow Chaudière River. The historic downtown will be replaced with a memorial park honouring the disaster's 47 victims, after a large-scale, years-long cleanup is completed.

But one question remains, fuelling the worry of the businesses expected to build on the new main street: Who will pay?

According to Mayor Colette Roy-Laroche's office, the federal and provincial governments will cover the bill for new infrastructure.

Private donations to help the town of 6,000 rebuild will also be directed to the project. The mayor's office says it's too soon to say who will help businesses.

The federal and provincial governments have pledged $120-million to Lac-Mégantic's cleanup and rebuilding, $35-million of it earmarked for the local economy.

"Everyone in the government is aware of the problem and they are all talking," said Pascal Hallé, president of the local chamber of commerce. "This will cost money, it won't be bric-à-brac, we are going to build something pleasing."

Mr. Hallé's personal story reflects the difficulties the town will face before rebuilding. The chamber president owns two businesses downtown: One was destroyed by fire, the other is standing but presumed to be too contaminated to ever use again.

Like many of the buildings left after fires and explosions gutted half the downtown, Mr. Hallé's surviving office will need to be torn down. His insurance has refused to pay for reconstruction due to contamination.

Despite the uncertainty, the plan – first shown to business leaders last Thursday – has garnered widespread applause.

"With the little amount of time they've had to work, this is an excellent and reasonable plan," said Gilles Pansera, who operates four factories in the Lac-Mégantic area. "However, I've warned the town not to get too involved in construction, this can be done privately. They can zone and we can build," added Mr. Pansera, who expressed concern that local taxes could increase significantly in the future.

The local government has taken the lead on plans to build a large market in the parking lot of the arena. The building could house businesses during the holiday period, before being converted into a public market, anchoring the northern edge of the new downtown.

Local officials have also pledged to move an existing lumberyard from the centre of the proposed new downtown.

The relocation plan could bring unprecedented change to the town's working-class Fatima district, across the river from downtown.

Sitting on his porch in Fatima, Réal Grenier says the neighbourhood hasn't really changed in the 30 years he's lived here. The plan would transform sleepy Lévis Street into part of the town's main drag, moving upscale businesses and organic grocery stores into the area.

With a credit union and one of Quebec's ubiquitous diners, the area is home to little more than bungalows and a car dealership. Locals say Fatima has seen businesses pack up to move downtown for decades.

At the southern edge of the proposed downtown, a realtor's sign is in the yard of the Notre-Dame-de-Fatima Catholic Church. The property has been on the market for four months, the realtor says, but interest has spiked.

"There isn't much to see here right now," said Mr. Grenier with a chuckle, gesturing at the deserted street. "I never thought that would change."