Transfer of base-year value from qualified contaminated property to replacement property
California law allows an owner of a qualified contaminated property to transfer its base-year value to a comparable replacement 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; (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.
Both the original property and the replacement property must be located in the same county. If not, the county in which the replacement property is located must have a resolution authorizing intercounty transfers under this code section.
A qualified contaminated property must meet all of the following:
Residential property that is uninhabitable or nonresidential property that is unusable as a result of environmental problems.
Located on a site that has been designated as a toxic or environmental hazard or as an environmental clean-up site by an agency of the state of California or the federal government.
Owned by a person or entity that did not participate or acquiesce in any act or omission that rendered the property uninhabitable or unusable. The owner cannot be related to the person or affiliated with the entity that committed the act or omission that contaminated the property.
