Plans by Wicklow County Council to spend millions of euro on land for social housing - which it is now thought is unlikely to be developed - have been referred by the Department of the Environment to the Attorney General.
The council needs to borrow €3m to complete the purchase of the 2.4 acres of land at Three Trouts in Charlesland in Greystones.
The council acquired the land through a Compulsory Purchase Order in July 2006.
However, a dispute arose between the landowners and the council over the value of the property, and this delayed the payment for the land and the transfer of it to the local authority for several years.
The issue was finally resolved in March of this year with a price tag of €3m agreed by both sides.
In the interim, central government funding for the construction of new social housing ceased due to the economic and property crash, and it is thought unlikely that the land will ever be used for social housing.
It is estimated that it is now only worth around €300,000 to €400,000.
But because the council effectively took ownership of the land in 2006 when the Compulsory Purchase Order was executed, the council claims it is legally obliged to complete the purchase for the €3m agreed.
However, to do so, the council is planning to borrow the money through the Housing Finance Agency. Agreement was given by a majority of councillors to do this at a special meeting last month.
Legally, the transaction has to be completed by the end of this month.
However, with just two days left in the month, Wicklow County Council has told RTÉ News that it has not yet filed an application for the funds with the Housing Finance Agency as it is awaiting approval from the Department of the Environment.
The Department, however, has told RTÉ News that it has referred the matter to the Attorney General for advice.
A spokesman for the department said the purpose of the referral was to allow the Attorney General's office examine the circumstances of the case, in the event a similar case arises in the future.
He denied that the department was examining it to see whether it might still be possible to unpick the deal.
It is also understood that Wicklow County Council engaged a senior counsel to advise it on the matter.
Last month, Labour TD for Wicklow Anne Ferris wrote to the chairman of the Dáil Public Accounts Committee seeking to have it examined.
Describing it as a scandalous waste of taxpayers' money, Ms Ferris said the committee should contact the Department of the Environment urging it to change the laws governing CPOs.
