Q Does a municipality have the authority to secure an option to purchase land? If so, is an appraisal required if the price for the option is only $3,000?

A Obtaining an option to purchase land constitutes the buying of an intangible right, rather than the making of an impermissible donation. Therefore, pursuant to a municipality’s home rule authority under Section 21-17-5, a municipality has the authority to procure an option to purchase real property, provided that it is not paying more than fair market value for said option. To determine fair market value of the option itself, the municipality would be required to have an appraisal of the option to purchase. Note that this will not have any effect on the requirements of Section 43-37-3 once the municipality exercises the option to purchase and proceeds to purchase the real property. (Attorney General’s Opinion to Barton, dated February 21, 2012)