(a) The department may execute an option contract for the acquisition of right of way and control of development rights if the Texas Transportation Commission has authorized the expenditure of option fees for a transportation facility project or corridor and the district engineer determines that:
  (1) the property to be optioned is or may possibly be used in or in connection with the transportation facility;
  (2) the size and location of the property to be optioned is reasonably related to the possible future design and alignment of the transportation facility; and
  (3) the terms of the option contract may be economically beneficial to the department by:
    (A) establishing the purchase price at current market value as of the date of the option contract;
    (B) establishing a methodology for determining a purchase price at the time the option is exercised to avoid the necessity for condemnation;
    (C) restricting development or improvements that would substantially increase the purchase price; or
    (D) reducing the time required for the acquisition of the property.
(b) An option contract shall be for a primary period of not more than 5 years, but may be subject to one or more extensions beyond the primary term, each extension period not to exceed 5 years.
(c) An option fee to be paid to the property owner may be:
  (1) a one-time fee paid at the time the option contract is executed;
  (2) in the form of periodic payments; or
  (3) a combination of paragraphs (1) and (2) of this subsection.

Source Note: The provisions of this §21.16 adopted to be effective October 21, 2004, 29 TexReg 9695; amended to be effective January 5, 2006, 30 TexReg 8997