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Qualified Contaminated Property



Proposition 1 allows for base year value transfers to from a qualified contaminated property to a replacement property within the same county.  A qualified contaminated property is one that has been designated as toxic or environmental hazard by a state or federal agency.  

About Proposition 1

California law allows an owner of a qualified contaminated property to transfer the base year value of that property to a comparable replacement property of equal or lesser value that is acquired or newly constructed after January 1, 1995.

In addition, a replacement property must meet all of the following requirements:

  1. It must have been acquired or newly constructed within five (5) years after the date of the sale or transfer; and
  2. It must be used in the same manner as the qualified contaminated property; and
  3. A claim for relief must be filed within three (3) years after the replacement property is acquired or newly constructed. 


  • Contaminated property and replacement property must be within the same county
  • Condition as a result of contamination
    • Residential must be uninhabitable – unfit for human habitation
    • Non-residential has to be unusable – unhealthy and unsuitable for occupancy
  • Owner limitation
    • Could not have caused contamination
    • Known of contamination when property was acquired or constructed
    • Be related to individual or entity that caused contamination
  • Contaminated property must be sold
  • Replacement must be acquired or constructed within 5 years after the sale of contaminated property
  • Replacement property must be comparable
    • Similar in function and utility – used in the same manner
    • Equal or lesser value

A claim must be filed within 3 years after the purchase or new construction of replacement property

In addition to the claim, the property owner must provide proof that he did not cause contamination.

Revenue & Taxation Code section 69.4