The project, formerly known as the Croxley Rail Link, is expected to create over 6500 permanent jobs and provide a £2bn boost to the local economy, and involves building two new stations at Cassiobridge and Watford Vicarage Road.
A full funding package, amounting to £284.4m, has been agreed between the Department for Transport (DfT), Hertfordshire County Council and Transport for London (TfL). TfL and the DfT will provide £49.2m and £109.8m, respectively, with the remaining £125.3m funded locally.
Mr Nick Brown, managing director LU, said: "For 100 years, the Tube has been enabling growth in 'Metro-land' and this new part of the Underground network will support further rapid development in the area. By 2020 we will have built a 400m viaduct, two completely new stations and numerous new and reconstructed bridges along the route, transforming transport links in Watford.
"With the funding package complete we're now turning all our attention to appointing contractors, finalising designs and beginning construction in 2016."
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