Educate Together schools are non-fee-paying schools open to students of all backgrounds. They are co-educational, have no school uniform and are state funded.
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Minister McHugh issued a "disappointing" response after being questioned by local Sinn Féin representative David Cullinane.
Deputy Cullinane has since called on the government to review its decision.
He said: "Fine Gael and their supporters in government, Fianna Fáil, need to reflect on this decision to exclude Waterford from current plans.
"It is simply unacceptable.
"I call on the Minister to commission a study on the need and demand for an Educate Together Secondary School in Waterford.
"It is the only sensible to so and needs to be completed as a matter of urgency."
(CM/JG)
