On November 3, 1998, the voters of California approved Proposition 1, which amends Section 2 of Article XIII of the California Constitution by adding subdivision (i). This amendment allows property tax relief in one of two forms for qualified contaminated property.

1. Property owners may sell or otherwise transfer the qualified contaminated property and transfer its base year value to a replacement property of equal or lesser value. The replacement property must be acquired or newly constructed within five years after the sale or transfer of the qualified contaminated property. If the replacement property is located in a different county than the qualified contaminated property, than the county in which the replacement property is located must have passed a resolution accepting such base year value transfer.
   
   
2. If structures located on the qualified contaminated property are substantially damaged or destroyed in the course of the remediation of the environmental problems, the repair or replacement of such structures may be excluded from the definition of "new construction" provided that the repaired or replacement structure is similar in size, utility, and function to the original structure.

• The property is rendered uninhabitable (residential real property) or unusable (nonresidential real property) due to environmental problems or the remediation of such problems
  
  
• The owner did not know the property was contaminated at the time the property was acquired or constructed
  
  
• The property is located on a site that a state or federal agency has designated as a toxic or environmental hazard or as an environmental cleanup site
  
  
• The property has structures upon it which are either substantially damaged or destroyed as a result of the environmental clean up activities
  
  
• The lead state or federal agency has stipulated that the owner of the property did not cause the environmental problems.