The planned development of up to 44 modular homes in Tallow may not go ahead.
That is according to Councillor John Pratt, who believes that issues from amenities and how tax payers money is being spend are contributing factors.
He added: "Obviously the Irish Water issues with Sewage and water services and also value for money from a tax payers point of view.
"The decision has to be confirmed by the OPW hopefully the decision can be made sooner rather than later.
"It is unlikely it will proceed in my opinion, but we need confirmation from the OPW until they confirm it and say it will not proceed."
Some concerns were raised by locals previously in relation to the development in the area in relation to the town being able to cope with the numbers.
He continued to say: "The main concern in the area is that the town can cope with the numbers. The original number was 44 and that is a large number for the town.
Another update was that it would be 20 homes, but the most recent update from the council is that there are challenges on the site".
The councilor says Facilities and access remains a concern for families arriving into the town.
"There is no doubt that it has been a challenging couple of weeks for all the local representatives and the hotel in Lismore as we welcome these people into our community.
Even in this instance regarding the modular homes, we have Ukrainian families in the town but it comes back again to even if this were to go ahead the reality is that we need to ensure that amenities are easily accessible."
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