subparagraph (D)(i) with respect to such 
property, including expenditures—
‘‘(I) to manage, remove, control, 
contain, abate, or otherwise remediate 
a hazardous substance, pollutant, or 
contaminant on the property, 
‘‘(II) to obtain a Phase II envi-
ronmental site assessment of the 
property, including any expenditure to 
monitor, sample, study, assess, or oth-
erwise evaluate the release, threat of 
release, or presence of a hazardous 
substance, pollutant, or contaminant 
on the property, 
‘‘(III) to obtain environmental 
regulatory certifications and approvals 
required to manage the remediation 
and monitoring of the hazardous sub-
stance, pollutant, or contaminant on 
the property, and 
‘‘(IV) regardless of whether it is 
necessary to obtain a certification de-
scribed in subparagraph (D)(i)(II), to 
obtain remediation cost-cap or stop-
loss coverage, re-opener or regulatory
action coverage, or similar coverage 
under environmental insurance poli-
cies, or financial guarantees required 
to manage such remediation and mon-
itoring. 
‘‘(ii) EXCEPTIONS.—Such term shall 
not include—
‘‘(I) any portion of the purchase 
price paid or incurred by the eligible 
taxpayer to acquire the qualifying 
brownfield property, 
‘‘(II) 
environmental 
insurance 
costs paid or incurred to obtain legal 
defense coverage, owner/operator li-
ability coverage, lender liability cov-
erage, professional liability coverage, 
or similar types of coverage, 
‘‘(III) any amount paid or in-
curred to the extent such amount is 
reimbursed, funded, or otherwise sub-
sidized by grants provided by the 
United States, a State, or a political 
subdivision of a State for use in con-
nection with the property, proceeds of 
an issue of State or local government
obligations used to provide financing 
for the property the interest of which 
is exempt from tax under section 103, 
or subsidized financing provided (di-
rectly or indirectly) under a Federal, 
State, or local program provided in 
connection with the property, or 
‘‘(IV) any expenditure paid or in-
curred before the date of the enact-
ment of this paragraph. 
For purposes of subclause (III), the Sec-
retary may issue guidance regarding the 
treatment of government-provided funds 
for purposes of determining eligible reme-
diation expenditures. 
‘‘(F) 
DETERMINATION
OF
GAIN
OR 
LOSS.—For purposes of this paragraph, the de-
termination of gain or loss shall not include an 
amount treated as gain which is ordinary in-
come with respect to section 1245 or section 
1250 property, including amounts deducted as 
section 198 expenses which are subject to the 
recapture rules of section 198(e), if the tax-
payer had deducted such amounts in the com-
putation of its unrelated business taxable in-
come. 
‘‘(G) SPECIAL
RULES
FOR
PARTNER-
SHIPS.—
‘‘(i) IN GENERAL.—In the case of an 
eligible taxpayer which is a partner of a 
qualifying partnership which acquires, re-
mediates, and sells, exchanges, or other-
wise disposes of a qualifying brownfield 
property, this paragraph shall apply to the 
eligible taxpayer’s distributive share of the 
qualifying partnership’s gain or loss from 
the sale, exchange, or other disposition of 
such property. 
‘‘(ii) QUALIFYING
PARTNERSHIP.—
The term ‘qualifying partnership’ means a 
partnership which—
‘‘(I) has a partnership agreement 
which satisfies the requirements of 
section 514(c)(9)(B)(vi) at all times 
beginning on the date of the first cer-
tification received by the partnership 
under subparagraph (C)(i), 
‘‘(II) satisfies the requirements 
of subparagraphs (B)(i), (C), (D), and
(E), if ‘qualified partnership’ is sub-
stituted for ‘eligible taxpayer’ each 
place it appears therein (except sub-
paragraph (D)(iii)), and 
‘‘(III) is not an organization 
which would be prevented from consti-
tuting an eligible taxpayer by reason 
of subparagraph (B)(ii). 
‘‘(iii) REQUIREMENT
THAT
TAX-EX-
EMPT
PARTNER
BE
A
PARTNER
SINCE 
FIRST
CERTIFICATION.—This paragraph 
shall apply with respect to any eligible tax-
payer which is a partner of a partnership 
which acquires, remediates, and sells, ex-
changes, or otherwise disposes of a quali-
fying brownfield property only if such eligi-
ble taxpayer was a partner of the quali-
fying partnership at all times beginning on 
the date of the first certification received 
by the partnership under subparagraph 
(C)(i) and ending on the date of the sale, 
exchange, or other disposition of the prop-
erty by the partnership. 
‘‘(iv) REGULATIONS.—The Secretary 
shall prescribe such regulations as are nec-