Government plans to use a 60-acre disused Army barracks in Kildare for social housing are being opposed by businesses and residents in the town.
The group, the Kildare Town Development Association, is also against the continued use of Magee Army Barracks to house asylum-seekers and Travellers.
The group claimed the current Government proposals makes no sense because the owner of the barracks, the Department of Defence, is due to move to nearby Newbridge under the decentralisation plans.
The group has also said that its continued use to house asylum-seekers and Travellers has prevented the proper development of a prime site in the town.
Recently advertisements have been placed in local papers by the Office of Public Works inviting proposals from interested landowners for suitable sites in the Newbridge area.
A spokesman for the association rejected suggestions that the group was anti-asylum-seeker or Travellers.
Mr Rory de Bruir said the site had been used in recent years "by four different Government Departments for the resolution of their own crises".
The delayed sell-off of the barracks to private developers has hindered the growth of the town, according to Mr de Bruir.
The sale of the barracks for private development was originally announced by the minister for defence in 1998. This never took place.
However, since 1999 it has been used to accommodate asylum-seekers. In 2000 a local Traveller family was also accommodated on the site.
Last year the Taoiseach, Mr Ahern, announced that the site would be handed over to the Department of the Environment for use as social housing.
According to Mr de Bruir, local groups received assurances in 1999 that the housing of asylum-seekers there was a temporary measure.
Mr de Bruir said the group was not opposed to social housing or asylum-seekers.
However, they were looking for the site to be developed for various uses.
"There are 63 acres there of prime development land zoned for mixed use," he said.
He said the group was not objecting to the inclusion of some level of housing on the site, but was opposed to the site being devoted to social housing, which he said was "madness".
"There has to be balanced development," he said.
He described the use of the entire site for housing as "bad planning when you have a large land bank worth 22 million in the centre of the town with a great potential for development".
"Houses could be built on land much more affordable."
He also described as "paradoxical, that a Minister hands over land, and is now seeking land in a town just five miles away which is going to cost a premium.
"To be fair I believe it would no longer be appropriate because Kildare town has for five years had asylum-seekers and we've made our contribution.
"At present the fact that they're there has prevented the objective being obtained of the proper development of the town for five years," he said.