Promoters of the £228M Oxford to Cambridge 'East-West Rail' project will combine the money from the Department for Communities and Local Government with a further £1M from local authorities benefiting from the route.
Buckinghamshire County Council senior transport policy officer Richard Ward said the money would help Network Rail's Guide to Railway Investment Projects process, leaving designs sufficiently complete to begin construction.
The line will be relatively cheap to complete, with much of the track abandoned but intact.
"The biggest challenges are at Aylesbury and between Bedford and the East Coast Main Line, where the track has not been secured," said Ward.
Once designs are finalised, funding for the project will come from a tax on property developments in areas such as Milton Keynes and Oxford.
"These are both strong growth areas and a supplementary roof tax would raise £100M relatively easily," added Ward.
The initial focus of the project is Bedford to Oxford, with a spur to Aylesbury. The final route would link Oxford to East Anglia.