Section 188 provides that all money received by a local government from the sale of land or improvements must be placed to the credit of a special fund and that money to repay an outstanding debt on the property must be set aside for that purpose.
A local government may accept any property, subject to any trusts on which the property is transferred. If the sale of the property is necessary to carry out the terms of a trust under which it was transferred, a local government may sell the property despite any limitations or restrictions in the Municipal Act. All money held by a local government subject to a trust, until required for the purposes of the trust, must be invested in the same manner as authorized for sinking funds.
Local governments are no longer prohibited from granting options to purchase property owned by the local government. Options are now treated as a form of disposal, with the same procedural requirements as are applicable to the sale or lease of local government real property. This will be advantageous when public private partners are interested in acquiring land or improvements in addition to the real property initially acquired in the partnering agreement. However, local governments need to ensure that the option is subject to the same forms of competitive processes as are other disposals (e.g., advertising requirements and offering property for sale to the public).