Aboriginals and non-aboriginals in a southeastern Ontario community are hopeful that a meeting between the federal government and a local Mohawk chief has defused a potential clash over a proposed housing development.

Construction was to begin Nov. 15 on a $30-million, 8.5-hectare waterfront subdivision in Deseronto, about 80 kilometres west of Kingston.

But the proposed site is on land the Mohawks of the nearby Tyendinaga Territory say still belongs to them because they never properly surrendered it. 

The situation was similar to that which led to a tense dispute in Caledonia, Ont., where, since February, Six Nations protesters have occupied land originally slated for a housing development.

Tyendinaga Territory Chief Don Maracle sounded optimistic after a meeting Thursday between the territory's band council and federal Minister of Indian Affairs Jim Prentice.

"I think the minister made a very positive gesture," Maracle said. "It was one we appreciate. I'm very hopeful there's an opportunity to work out something."

Deseronto Mayor Clarence Ziemen said he hopes the meeting results in the postponement of the construction.

"I'm not in favour of proceeding with this at all at this time until we get some of this land claim issue out of the way," he said, adding that the federal government has confirmed there is a land claim concerning the proposed site.

Local politicians were originally enthusiastic about the economic boost that the housing development would give the town. But Zieman said they now realize it is more important to preserve the good relations that his community and the Tyendinaga Mohawks have had for generations.