California law provides that under certain conditions a person may transfer the base year value of his or her property to a
comparable replacement property if that original property has been taken by eminent domain proceedings, acquisition by a public entity,
or governmental action resulting in a judgment of inverse condemnation.
To be considered comparable, a replacement property acquired by a person displaced under one of the three con ditions above must
be similar in size, utility, and function to the taken property. Replacement property is similar in size if its full cash value does not
exceed 120 percent of the award or purchase price paid for the property taken. Replacement property is similar in utility and function
if it is, or is intended to be, used in the same manner as the property taken. Property is similar in utility and function if the property
taken and the replacement property fall into the same category: Category A - single family and duplex; Category B - commercial,
investment, income, or vacant property; Category C - agricultural property. If replacement property is not similar in size, function, and
utility, the excess portion is considered to have undergone a change in ownership and will be subject to reappraisal.
The base year value of the replacement property will be determined by comparing the award or purchase price paid for the taken
property with the full cash value of the replacement property:
• If this value does not exceed 120 percent of the award or purchase price paid for the taken property, then
the adjusted base year value of the taken property becomes the replacement property’s base year value.
• If the full cash value of the replacement property exceeds the 120 percent level, the amount of full cash value
in excess of 120 percent will be added to the base year value of the taken property. This sum becomes the base year
value of the replacement property.
• If the full cash value of the replacement property is less than the base year value of the property taken, that
lower value becomes the base year value of the replacement property.
• If there is no award or price paid for the property taken (i.e., an exchange), the Assessor must determine
the full cash value of both the property taken and the replacement property.
Only the owner(s) of the property taken may receive this property tax relief. Owner means the fee owner or life estate owner of the real property taken.
For replacement property acquired on or after January 1, 1983, a request for relief is considered timely if made within four years of
one of the following dates, whichever is applicable:
• The date the final order of condemnation is recorded or the taxpayer vacates the replaced property,
whichever is later.
• The date of the conveyance or the date the taxpayer vacates the replaced property, whichever is later.
• The date the judgment of inverse condemnation becomes final or the date the taxpayer vacates the replaced
property, whichever is later.
Replacement property is eligible for relief if acquired after March 1, 1975, and on or after the earliest of:
• The date the initial written offer is made by the acquiring entity.
• The date the acquiring entity takes final action to approve a project leading to the offer.
• The date the “Notice of Determination,” “Notice of Exemption,” or similar notice, as required by the California
Environmental Quality Act (CEQA), is recorded by the public entity acquiring the taxpayer’s property and the
public project has been approved.
• The date, as declared by the court, that the replaced property was taken.
Relief is limited to the date of displacement, which is the earliest of:
• The date of conveyance to the acquiring entity or the recording of the final order of condemnation.
• The date of actual possession by the acquiring entity.
• The date on or after which an order for possession authorizes the acquiring entity to take the property.
You must provide the Assessor a certified copy of the final order of condemnation or order for possession; a certified copy of the recorded
deed showing acquisition by a public entity; a certified copy of the judgment of inverse condemnation; or a certified copy of a document
which clearly indicates the name of the acquiring agency, the date condemnation proceedings began, and the date of possession by
the acquiring agency.
The Assessor will forward information relative to each claim for property tax relief under this program to the Board of Equalization,
County-Assessed Properties Division, MIC:64, P.O. Box 942879, Sacramento, CA 94279-0064, which will determine whether more
than one claim for such assessment relief has been made and, if so, will notify the appropriate Assessor(s).
