Chelmsford council, which changed control from Liberal Democrat to Conservative in the May local elections, looks likely to vote against a plan to build 1900 houses on a 106 ha greenfield site at Boreham, near Chelmsford.
If the government fails to contest the decision, it is likely to make the implementation of its 10-year communities plan more difficult. The plan, which is the centrepiece of deputy prime minister John Prescott's housing policy, calls for residential growth in designated areas in the South-east.
The joint owners of the site are materials producers RMC and Hanson, and local developer MDR. They have written to housing minister Keith Hill to ask the government to exercise its power, under section 50 of the Town and County Planning Act, to force the council to proceed with the plan.
Under the government's blueprint for the Chelmsford area, 11,160 homes are to be built by 2011.
Neil Gulliver, the council's portfolio holder for planning and transport, said it was essential to have sufficient money set aside for a railway station and other infrastructure before the houses were built. The council believed there were no such funds available.
MDR says the council's opposition is based on ideological resistance to greenfield development and that its understanding of the transport issues is mistaken.
Its letter to Hill reads: "A station can be delivered in 2008, which ties in with the housing completions … The same issues of timescale/delivery apply to the proposal for a station as part of Beaulieu Park." This is a separate development on the outskirts of Chelmsford.
One source close to MDR said the company was furious with the council. He said: "The council is abandoning its duty by pulling the plug on a plan that is nine-tenths of the way through the system."
A spokesperson for the Office of the Deputy Prime Minister said a decision on whether to enforce plans was imminent.