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FORM 10-K
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT
OF 1934 (FEE REQUIRED)
For the fiscal year ended March 31, 1998
Commission File Number 0-21762
Gateway Tax Credit Fund III Ltd.
(Exact name of Registrant as specified in its charter)
Florida 59-3090386
(State or other jurisdiction of ( I.R.S. Employer No.)
incorporation or organization)
880 Carillon Parkway, St. Petersburg, Florida 33716
(Address of principal executive offices) (Zip Code)
Registrant's Telephone No., Including Area Code: (813)573-3800
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act:
Title of Each Class: Beneficial Assignee Certificates
Indicate by check mark whether the Registrant: (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.
YES X NO
Indicate by check mark if disclosure of delinquent filers pursuant to item
405 of Regulation S-K (Sec. 229.405 of this chapter) is not contained
herein, and will be contained to the best of registrant's knowledge, in
definitive proxy or information statements incorporated by reference in
Park III of this Form 10-K or any amendment to this Form 10-K. X
Number of Record Holders
Title of Each Class March 31, 1998
Limited Partnership Interest 2,205
General Partner Interest 2
DOCUMENTS INCORPORATED BY REFERENCE
Parts III and IV - Form S-11 Registration Statement and all amendments and
supplements thereto.
File No. 33-44238
PART I
Item 1. Business
Gateway Tax Credit Fund III Ltd. ("Gateway") is a Florida Limited
Partnership. The general partners are Raymond James Tax Credit Funds,
Inc., the Managing General Partner, and Raymond James Partners, Inc., both
sponsors of Gateway Tax Credit Fund III Ltd. and wholly-owned subsidiaries
of Raymond James Financial, Inc. Gateway was formed October 17, 1991 and
commenced operations July 16, 1992 with the first admission of Limited
Partners.
Gateway is engaged in only one industry segment, to acquire limited
partnership interests in unaffiliated limited partnerships ("Project
Partnerships"), each of which owns and operates one or more apartment
complexes eligible for Low-Income Housing Tax Credits under Section 42 of
the Internal Revenue Code ("Tax Credits"), received over a ten year period.
Subject to certain limitations, Tax Credits may be used by Gateway's
investors to reduce their income tax liability generated from other income
sources. Gateway will terminate on December 31, 2040, or sooner, in
accordance with the terms of its Limited Partnership Agreement. As of
March 31, 1998, Gateway received capital contributions of $1,000 from the
General Partners and from the Limited Partners, $10,395,000 in Series 7,
$9,980,000 from Series 8, $6,254,000 from Series 9, $5,043,000 from Series
10 and $5,127,000 from Series 11.
Gateway offered Limited Partnership units in series. Each series is
treated as though it were a separate partnership, investing in a separate
and distinct pool of Project Partnerships. Net proceeds from each series
are used to acquire Project Partnerships which are specifically allocated
to such series. Income or loss and all tax items from the Project
Partnerships acquired by each series are specifically allocated among the
limited partners of such series.
Operating profits and losses, cash distributions from operations and Tax
Credits are allocated 99% to the Limited Partners and 1% to the General
Partners. Profit or loss and cash distributions from sales of property
will be allocated as described in the Limited Partnership Agreement.
As of March 31, 1998, Gateway had invested in 39 Project Partnerships for
Series 7, 43 Project Partnerships for Series 8, 24 Project Partnerships for
Series 9, 15 Project Partnerships for Series 10 and 12 Project Partnerships
for Series 11. Gateway acquired its interests in these properties by
becoming a limited partner in the Project Partnerships that own the
properties. The primary source of funds for each series is the capital
contributions from Limited Partner investors.
All but eight of the properties are financed with mortgage loans from the
Farmers Home Administration (now called Rural Economic and Community
Development) ("RECD") under Section 515 of the Housing Act of 1949. These
mortgage loans are made at low interest rates for multi-family housing in
rural and suburban areas, with the requirement that the interest savings be
passed on to low income tenants in the form of lower rents. A significant
portion of the project partnerships also receive rental assistance from
RECD to subsidize certain qualifying tenants. One recently acquired
property in Series 7 received conventional financing. One property in
Series 9, two properties in Series 10 and one property in Series 11 are
fully financed through the HOME Investment Partnerships Program. These
HOME Program loans provide financing at rates of 0 % to 0.5% for a period
of 15 to 42 years. One property in Series 11 is partially financed by
HOME. Two properties in Series 11 received conventional financing.
Risks related to the operations of Gateway are described in detail on
pages 29 through 38 of the Prospectus, as supplemented, under the Caption
"Risk Factors" which is incorporated herein by reference. The investment
objectives of Gateway are to:
1) Provide tax benefits to Limited Partners in the form of Tax
Credits during the period in which each Project is eligible to claim
tax credits;
2) Preserve and protect the capital contribution of Investors;
3) Participate in any capital appreciation in the value of the
Projects; and
4) Provide passive losses to i) individual investors to offset
passive income from other passive activities, and ii) corporate
investors to offset business income.
The investment objectives and policies of Gateway are described in detail
on pages 39 through 47 of the Prospectus, as supplemented, under the
caption "Investment Objectives and Policies" which is incorporated herein
by reference.
Gateway's goal is to invest in a diversified portfolio of Project
Partnerships located in rural and suburban locations with a high demand for
low income housing. As of March 31, 1998 the Series' investor capital
contributions were successfully invested in Project Partnerships which met
the investment criteria. Management anticipates that competition for
tenants will only be with other low income housing projects and not with
conventionally financed housing. With a significant number of rural
American households living below the poverty level in substandard housing,
management believes there will be a continuing demand for affordable low
income housing for the foreseeable future.
Gateway has no direct employees. Services are performed by the Managing
General Partner and its affiliates and by agents retained by it. The
Managing General Partner has full and exclusive discretion in management
and control of Gateway.
Item 2. Properties
Gateway owns a majority interest in properties through its limited
partnership investments in Project Partnerships. The largest single net
investment in a Project Partnership in Series 7 is 11.1% of the Series'
total balance sheet assets, Series 8 is 4.6%, Series 9 is 12.5%, Series 10
is 18.4% and Series 11 is 20.4%. The following table provides certain
summary information regarding the Project Partnerships in which Gateway had
an interest as of December 31, 1997:
Item 2 - Properties (continued):
SERIES 7
OCCU-
LOCATION OF # OF DATE PROPERTY PANCY
PARTNERSHIP PROPERTY UNIT ACQUIRED COST RATE
- ----------- ----------- ---- -------- -------- -----
Nottingham Pisgah, AL 18 6/92 $ 717,067 94%
Cedar Hollow Waterloo, NE 24 7/92 927,565 100%
Sunrise Mission, SD 44 7/92 2,507,687 93%
Mountain City Mountain City, TN 40 8/92 1,598,107 100%
Burbank Falls City, NE 24 8/92 979,819 92%
Washington Bloomfield, NE 24 9/92 962,552 88%
BrookStone McCaysville, GA 40 9/92 1,457,196 98%
Tazewell New Tazewell, TN 44 9/92 1,716,442 93%
N. Irvine Irvine, KY 24 9/92 1,018,407 100%
Horton Horton, KS 24 9/92 932,540 92%
Manchester Manchester, GA 42 9/92 1,473,065 98%
Waynesboro Waynesboro, GA 24 9/92 815,851 100%
Lakeland II Lakeland, GA 30 9/92 1,009,647 93%
Mt. Vernon Mt. Vernon, GA 24 9/92 900,526 75%
Meadow Run Dawson, GA 48 9/92 1,744,840 94%
Spring Creek II Quitman, GA 24 9/92 808,475 96%
Warm Springs Warm Springs, GA 22 9/92 820,758 91%
Blue Ridge Blue Ridge, GA 41 9/92 1,334,613 100%
Walnut Elk Point, SD 24 9/92 995,726 54%
Pioneer Mountain View, AR 48 9/92 1,331,576 100%
Dilley Dilley, TX 28 9/92 889,051 96%
Elsa Elsa, TX 40 9/92 1,340,481 100%
Clinch View Gate City, VA 42 9/92 1,781,033 100%
Jamestown Jamestown, TN 40 9/92 1,499,883 98%
Leander Leander, TX 36 9/92 1,114,334 100%
Louisa Sr. Louisa, KY 36 9/92 1,504,659 100%
Orchard Commons Crab Orchard, KY 12 9/92 479,661 100%
Vardaman Vardaman, MS 24 9/92 905,694 96%
Heritage Park Paze, AZ 32 9/92 1,547,051 97%
BrooksHollow Jasper, GA 40 9/92 1,435,132 100%
Cavalry Crossing Ft. Scott, KS 40 9/92 1,751,111 98%
Carson City Carson City, KS 24 11/92 957,011 92%
Matteson Capa, KS 24 11/92 936,745 100%
Pembroke Pembroke, KY 16 12/92 623,304 100%
Robynwood Cynthiana, KY 24 12/92 1,011,684 100%
Atoka Atoka, OK 24 1/93 835,334 100%
Coalgate Coalgate, OK 24 1/93 828,505 100%
Hill Creek West Blocton, AL 24 11/93 956,253 96%
Cardinal Mountain Home, AR 32 11/93 777,266 97%
---- ----------
1,195 $45,226,651
===== ==========
An average effective rental per unit is $3,212 per year ($268 per month).
Item 2 - Properties (continued):
SERIES 8
OCCU-
LOCATION OF # OF DATE PROPERTY PANCY
PARTNERSHIP PROPERTY UNIT ACQUIRED COST RATE
- ----------- ----------- ----- -------- -------- ------
Purdy Purdy, MO 16 12/92 $ 565,034 88%
Galena Galena, KS 24 12/92 747,304 92%
Antlers 2 Antlers, OK 24 1/93 787,859 96%
Holdenville Holdenville, OK 24 1/93 892,598 100%
Wetumka Wetumka, OK 24 1/93 812,853 100%
Mariners Cove Marine City, MI 32 1/93 1,263,433 94%
Mariners Cove Sr. Marine City, MI 24 1/93 984,739 96%
Antlers Antlers, OK 36 3/93 1,321,039 86%
Bentonville Bentonville, AR 24 3/93 758,489 96%
Deerpoint Elgin, AL 24 3/93 932,474 88%
Aurora Aurora, MO 28 3/93 882,856 100%
Baxter Baxter Springs, KS 16 4/93 532,875 100%
Arbor Gate Bridgeport, AL 24 5/93 918,303 88%
Timber Ridge Collinsville, AL 24 5/93 895,627 75%
Concordia Sr. Concordia, KS 24 5/93 826,389 100%
Mountainburg Mountainburg, AR 24 6/93 883,990 100%
Lincoln Pierre, SD 25 5/93 1,084,491 96%
Fox Ridge Russellville, AL 24 6/93 902,785 96%
Meadow View Bridgeport, NE 16 6/93 717,544 81%
Sheridan Auburn, NE 16 6/93 744,452 75%
Morningside Kenton, OH 32 6/93 1,184,805 97%
Grand Isle Grand Isle, ME 16 6/93 1,200,210 69%
Meadowview Van Buren, AR 29 8/93 994,717 100%
Taylor Taylor, TX 44 9/93 1,530,768 100%
Brookwood Gainesboro, TN 44 9/93 1,809,449 100%
Pleasant Valley Lynchburg, TN 33 9/93 1,346,228 100%
Reelfoot Ridgely, TN 20 9/93 814,568 100%
River Rest Newport, TN 34 9/93 1,403,425 100%
Kirskville Kirksville, MO 24 9/93 831,492 100%
Cimmaron Arco, ID 24 9/93 1,087,841 96%
Kenton Kenton, OH 46 9/93 1,764,144 91%
Lovingston Lovingston, VA 64 9/93 2,720,846 100%
Pontotoc Pontotoc, MS 36 10/93 1,326,113 94%
So. Brenchley Rexburg, ID 30 10/93 1,548,673 97%
Hustonville Hustonville, KY 16 10/93 693,139 94%
Northpoint Jackson, KY 24 10/93 1,082,599 100%
Brooks Field Louisville, GA 32 10/93 1,171,823 100%
Brooks Lane Clayton, GA 36 10/93 1,348,191 100%
Brooks Point Dahlonega, GA 41 10/93 1,657,691 100%
Brooks Run Jasper, GA 24 10/93 923,814 100%
Logan Heights Russellville, KY 24 11/93 951,730 83%
Lakeshore 2 Tuskegee, AL 36 12/93 1,415,885 94%
Cottondale Cottondale, FL 25 1/94 948,319 96%
----- -----------
1,207 $47,211,604
===== ===========
An average effective rental per unit is $3,133 per year ($261 per month).
Item 2 - Properties (continued):
SERIES 9
OCCU-
LOCATION OF # OF DATE PROPERTY PANCY
PARTNERSHIP PROPERTY UNIT ACQUIRED COST RATE
- ----------- ----------- ----- -------- -------- ------
Jay Jay, OK 24 9/93 $ 810,597 100%
Boxwood Lexington, TX 24 9/93 770,939 96%
Stilwell 3 Stilwell, OK 16 9/93 587,132 88%
Arbor Trace Lake Park, GA 24 11/93 918,358 100%
Arbor Trace 2 Lake Park, GA 42 11/93 1,806,435 98%
Omega Omega, GA 36 11/93 1,407,304 81%
Cornell 2 Watertown, SD 24 11/93 1,142,441 92%
Elm Creek Pierre, SD 24 11/93 1,162,144 79%
Marionville Marionville, MO 20 11/93 696,510 95%
Lamar Lamar, AR 24 12/93 904,325 96%
Mt. Glen Heppner, OR 24 12/93 1,058,211 83%
Centreville Centreville, AL 24 12/93 973,835 100%
Skyview Troy, AL 36 12/93 1,395,014 100%
Sycamore Coffeyville, KS 40 12/93 1,765,516 100%
Bradford Cumberland, KY 24 12/93 1,055,632 100%
Cedar Lane London, KY 24 12/93 995,281 100%
Stanton Stanton, KY 24 12/93 1,001,158 100%
Abernathy Abernathy, TX 24 1/94 781,898 96%
Pembroke Pembroke, KY 24 1/94 998,687 96%
Meadowview Greenville, AL 24 2/94 1,134,218 96%
Town Branch Mt. Vernon, KY 24 12/93 984,410 100%
Fox Run Ragland, AL 24 3/94 968,994 88%
Maple Street Emporium, PA 32 3/94 1,697,719 100%
Manchester Manchester, GA 18 5/94 735,135 100%
----- ----------
624 $25,751,893
===== ==========
An average effective rental per unit is $3,256 per year ($271 per month).
Item 2 - Properties (continued):
SERIES 10
OCCU-
LOCATION OF # OF DATE PROPERTY PANCY
PARTNERSHIP PROPERTY UNIT ACQUIRED COST RATE
- ----------- ----------- ----- -------- -------- ------
Redstone Challis, ID 24 11/93 $1,099,763 96%
Albany Albany, KY 24 1/94 1,029,662 96%
Oak Terrace Bonifay, FL 18 1/94 661,663 100%
Wellshill West Liberty, KY 32 1/94 1,345,844 100%
Applegate Florence, AL 36 2/94 1,835,686 97%
Heatherwood Alexander, AL 36 2/94 1,607,378 92%
Peachtree Gaffney, SC 28 3/94 1,046,466 96%
Donna Donna, TX 50 1/94 1,776,522 98%
Wellsville Wellsville, NY 24 2/94 1,332,613 92%
Tecumseh Tecumseh, NE 24 4/94 1,059,765 75%
Clay City Clay City, KY 24 5/94 1,021,084 96%
Irvine West Irvine, KY 24 5/94 1,086,338 96%
New Castle New Castle, KY 24 5/94 1,019,050 100%
Stigler Stigler, OK 20 7/94 754,056 100%
Courtyard Huron, SD 21 8/94 764,318 100%
---- -----------
409 $17,440,208
==== ===========
An average effective rental per unit is $3,235 per year ($270 per month).
Item 2 - Properties (continued):
SERIES 11
OCCU-
LOCATION OF # OF DATE PROPERTY PANCY
PARTNERSHIP PROPERTY UNIT ACQUIRED COST RATE
- ----------- ----------- ----- -------- -------- ------
Homestead Pinetop, AZ 32 9/94 $1,754,502 100%
Mountain Oak Collinsville, AL 24 9/94 879,424 88%
Eloy Eloy, AZ 24 11/94 896,409 100%
Gila Bend Gila Bend, AZ 36 11/94 1,274,647 92%
Creekstone Dallas, GA 40 12/94 2,008,604 100%
Tifton Tifton, GA 36 12/94 1,679,705 100%
Cass Towne Cartersville, GA 10 12/94 324,320 100%
Warsaw Warsaw, VA 56 12/94 3,352,879 100%
Royston Royston, GA 25 12/94 932,820 96%
Red Bud Mokane, MO 8 12/94 301,117 75%
Cardinal Mountain Home, AR 32 12/94 507,090 97%
Parsons Parsons, KS 38 12/94 1,319,843 97%
---- -----------
361 $15,231,360
==== ===========
An average effective rental per unit is $3,653 per year ($304 per month).
A summary of the cost of the properties at December 31, 1997, 1996 and 1995
is as follows:
12/31/97
SERIES 7 SERIES 8 SERIES 9
Land $ 1,615,119 $ 1,978,810 $ 1,099,659
Land Improvements 78,933 425,076 178,022
Buildings 41,938,629 43,289,922 23,558,060
Furniture and Fixtures 1,593,970 1,517,796 916,152
Construction in Progress 0 0 0
----------- ----------- -----------
Properties, at Cost 45,226,651 $47,211,604 $25,751,893
Less: Accum.Depreciation 7,267,152 6,410,571 3,111,495
----------- ----------- -----------
Properties, Net $37,959,499 $40,801,033 $22,640,398
=========== =========== ===========
SERIES 10 SERIES 11 TOTAL
Land $ 648,625 $ 599,197 $ 5,941,410
Land Improvements 58,185 0 740,216
Buildings 16,279,503 14,270,891 139,337,005
Furniture and Fixtures 453,895 361,272 4,843,085
Construction in Progress 0 0 0
----------- ----------- ------------
Properties, at Cost $17,440,208 $15,231,360 $150,861,716
Less: Accum.Depreciation 1,734,926 1,240,103 19,764,247
----------- ----------- ------------
Properties, Net $15,705,282 $13,991,257 $131,097,469
=========== =========== ============
Item 2 - Properties (continued):
12/31/96
SERIES 7 SERIES 8 SERIES 9
Land $ 1,615,119 $ 1,978,810 $ 1,099,659
Land Improvements 87,542 411,365 174,250
Buildings 45,053,147 43,294,684 23,548,626
Furniture and Fixtures 1,412,182 1,469,856 898,992
Construction in Progress 0 0 0
----------- ----------- -----------
Properties, at Cost $45,167,990 $47,154,715 $25,721,527
Less: Accum.Depreciation 5,712,059 4,790,218 2,212,706
----------- ----------- -----------
Properties, Net $39,455,931 $42,364,497 $23,508,821
=========== =========== ===========
SERIES 10 SERIES 11 TOTAL
Land $ 648,625 $ 599,470 $ 5,941,683
Land Improvements 57,572 0 730,729
Buildings 16,312,322 14,291,880 139,500,659
Furniture and Fixtures 412,688 327,601 4,521,319
Construction in Progress 0 0 0
----------- ----------- ------------
Properties, at Cost $17,431,207 $15,218,951 $150,694,390
Less: Accum.Depreciation 1,230,341 738,925 14,684,249
----------- ----------- ------------
Properties, Net $16,200,866 $14,480,026 $136,010,141
=========== =========== ============
12/31/95
SERIES 7 SERIES 8 SERIES 9
Land $ 1,615,119 $ 1,978,810 $ 1,099,659
Land Improvements 177,159 409,921 167,424
Buildings 41,501,608 43,293,853 23,549,661
Furniture and Fixtures 1,412,943 1,435,197 888,379
Construction in Progress 330,777 0 0
----------- ----------- -----------
Properties, at Cost $45,037,606 $47,117,781 $25,705,123
Less: Accum.Depreciation 4,103,029 3,146,594 1,301,928
----------- ----------- -----------
Properties, Net $40,934,577 $43,971,187 $24,403,195
=========== =========== ===========
SERIES 10 SERIES 11 TOTAL
Land $ 648,625 $ 606,221 $ 5,948,434
Land Improvements 56,777 0 811,281
Buildings 16,357,696 13,294,591 137,997,409
Furniture and Fixtures 343,848 264,287 4,344,654
Construction in Progress 0 535,974 866,751
----------- ----------- ------------
Properties, at Cost $17,406,946 $14,701,073 $149,968,529
Less: Accum.Depreciation 719,972 205,821 9,477,344
----------- ----------- ------------
Properties, Net $16,686,974 $14,495,252 $140,491,185
=========== =========== ============
Item 3. Legal Proceedings
Gateway is not a party to any material pending legal proceedings.
Item 4. Submission of Matters to a Vote of Security Holders
As of March 31, 1998, no matters were submitted to a vote of security
holders, through the solicitation of proxies or otherwise.
PART II
Item 5. Market for the Registrant's Securities and Related Security Holder
Matters
(a) Gateway's Limited Partnership interests are not publicly
traded. There is no market for Gateway's Limited Partnership
interests and it is unlikely that any will develop. No transfers
of Limited Partnership Interests are permitted without the prior
written consent of the Managing General Partner. There have been
several transfers from inception to date with most being from
individuals to their trusts or heirs. The Managing General Partner
is not aware of the price at which Limited Partnership units are
transferred. The criteria for and the details regarding transfers
are found on pages A-28 and A-29 of the Limited Partnership
Agreement under ARTICLE XII under the caption "Transfers of Units"
found in the Prospectus, which is incorporated herein by reference.
There have been no distributions to Limited Partner investors from
inception to date.
(b) Approximate Number of Equity Security Holders:
Number of Holders
Title of Class as of March 31, 1998
Limited Partner Interest 2,205
General Partner Interest 2
Item 6. Selected Financial Data
FOR THE YEARS ENDED MARCH 31,
SERIES 7 1998 1997 1996 1995 1994
---- ---- ---- ---- ----
Total
Revenues $ 44,592 $ 43,466 $ 54,373 $ 64,102 $ 83,225
Net Loss (1,010,863) (1,026,918) (1,014,650) (1,187,932) (837,731)
Equity in
Losses of
Project
Partnerships (909,991) (936,184) (936,257) (1,118,343) (783,073)
Total Assets 4,255,853 5,218,302 6,203,282 7,167,131 8,485,924
Investments
In Project
Partnerships 3,517,852 4,483,546 5,464,982 6,022,991 7,343,297
Per Weighted
Average
Limited
Partnership
Unit: (A)
Tax Credits 161.50 160.60 153.40 140.20 68.50
Portfolio
Income 10.30 9.80 9.60 8.90 9.90
Passive Loss (117.30) (113.20) (121.90) (131.60) (95.50)
Net Loss (96.27) (97.81) (96.63) (113.14) (79.78)
FOR THE YEARS ENDED MARCH 31,
SERIES 8 1998 1997 1996 1995 1994
---- ---- ---- ---- ----
Total
Revenues $ 46,987 $ 48,637 $ 46,431 $ 67,069 $ 142,722
Net Loss (1,060,938) (1,089,189) (1,201,546) (1,076,492) (244,729)
Equity in
Losses of
Project
Partnerships (963,455) (999,833) (1,110,855) (996,606) (297,929)
Total Assets 4,446,829 5,451,625 6,480,200 7,853,765 9,991,144
Investments
In Project
Partnerships 3,608,229 4,614,122 5,658,160 6,909,627 8,229,829
Per Weighted
Average
Limited
Partnership
Unit: (A)
Tax Credits 160.80 159.20 143.80 104.62 21.60
Portfolio
Income 10.60 8.90 8.00 9.50 17.10
Passive Loss (130.60) (138.30) (131.60) (125.50) (36.20)
Net Loss (105.56) (108.37) (119.55) (107.11) (24.35)
FOR THE YEARS ENDED MARCH 31,
SERIES 9 1998 1997 1996 1995 1994
---- ---- ---- ---- ----
Total
Revenues $ 25,209 $ 25,848 $ 29,092 $ 56,756 $ 45,037
Net Loss (512,506) (557,202) (504,713) (290,577) 13,099
Equity in
Losses of
Project
Partnerships (459,629) (506,807) (458,221) (271,414) (15,788)
Total Assets 3,830,465 4,307,579 4,824,662 5,615,793 6,583,534
Investments
In Project
Partnerships 3,363,377 3,848,367 4,397,301 4,901,634 4,825,074
Per Weighted
Average
Limited
Partnership
Unit: (A)
Tax Credits 153.40 153.30 143.10 50.40 .00
Portfolio
Income 9.10 8.10 8.50 12.30 4.80
Passive Loss (100.80) (108.70) (102.70) (61.20) (4.80)
Net Loss (81.13) (88.20) (79.90) (46.00) 4.15
FOR THE YEARS ENDED MARCH 31,
SERIES 10 1998 1997 1996 1995 1994
---- ---- ---- ---- ----
Total
Revenues $ 24,885 $ 24,953 $ 27,591 $ 62,023 $ 15,622
Net Loss (224,779) (214,923) (189,034) (110,564) 10,369)
Equity in
Losses of
Project
Partnerships (195,183) (190,191) (167,857) (121,762) (309)
Total Assets 3,784,494 4,006,856 4,203,400 4,537,644 5,754,711
Investments
In Project
Partnerships 3,352,669 3,571,518 3,788,041 3,966,411 2,868,929
Per Weighted
Average
Limited
Partnership
Unit: (A)
Tax Credits 149.60 149.60 139.10 47.40 .00
Portfolio
Income 9.70 8.88 8.80 18.70 .00
Passive Loss (82.30) (79.00) (79.80) (39.30) .00
Net Loss (44.13) (42.19) (37.11) (21.71) 9.77
FOR THE YEARS ENDED MARCH 31,
SERIES 11 1998 1997 1996 1995 1994
---- ---- ---- ---- ----
Total
Revenues $ 26,502 $ 30,465 $ 69,130 $ 158,326 $ 0
Net Loss (183,183) (196,029) (108,465) 136,410 0
Equity in
Losses of
Project
Partnerships (163,364) (182,485) (134,308) (9,886) 0
Total Assets 4,314,491 4,487,039 4,962,767 5,619,288 0
Investments
In Project
Partnerships 3,861,731 4,070,301 4,340,316 3,771,207 0
Per Weighted
Average
Limited
Partnership
Unit: (A)
Tax Credits 146.20 57.50 32.70 .00 .00
Portfolio
Income 9.50 11.00 20.70 24.40 .00
Passive Loss (58.40) (57.50) (37.60) (2.40) .00
Net Loss (35.37) (37.85) (20.94) 26.34 .00
(A) The tax information is as of December 31, the year end for tax
purposes.
The above selected financial data should be read in conjunction with the
financial statements and related notes appearing elsewhere in this report.
This statement is not covered by the auditor's opinion included elsewhere
in this report.
Item 7. Management's Discussion and Analysis of Financial Condition and
Results of Operations
Results of Operations, Liquidity and Capital Resources
Operations commenced on July 16, 1992 with the first admission of
Limited Partners in Series 7. The proceeds from Limited Partner investors'
capital contributions available for investment are used to acquire
interests in Project Partnerships.
As disclosed on the statement of operations for each Series, except as
described below, interest income is comparable for the years ended March
31, 1998, March 31, 1997 and March 31, 1996. General and Administrative
expenses - General Partner and General and Administrative expenses - Other
for the year ended March 31, 1998 are comparable to March 31, 1997 and
March 31, 1996.
The capital resources of each Series are used to pay General and
Administrative operating costs including personnel, supplies, data
processing, travel and legal and accounting associated with the
administration and monitoring of Gateway and the Project Partnerships. The
capital resources are also used to pay the Asset Management Fee due the
Managing General Partner, but only to the extent that Gateway's remaining
resources are sufficient to fund Gateway's ongoing needs. (Payment of any
Asset Management Fee unpaid at the time Gateway sells its interests in the
Project Partnerships is subordinated to the investors' return of their
original capital contribution.)
The sources of funds to pay the operating costs of each Series are short-
term investments and interest earned thereon, the maturity of U.S. Treasury
Security Strips ("Zero Coupon Treasuries") which were purchased with funds
set aside for this purpose, and cash distributed to the Series from the
operations of the Project Partnerships.
Series 7 - Gateway closed this series on October 16, 1992 after
receiving $10,395,000 from 635 Limited Partner investors. As of March 31,
1998, the series had invested $7,732,089 in 39 Project Partnerships located
in 14 states containing 1,195 apartment units. Average occupancy of the
Project Partnerships was 96% at December 31, 1997.
Equity in losses of Project Partnerships for the year ended March 31,
1998 of $909,991 were comparable to the Equity in losses of Project
Partnerships of $936,184 for the year ended March 31, 1997 and $936,257 for
the year ended March 31, 1996. In general, it is common in the real estate
industry to experience losses for financial and tax reporting purposes
because of the non-cash expenses of depreciation and amortization. (These
Project Partnerships reported depreciation and amortization of $1,553,899,
$1,625,748 and $1,573,077 for the periods ended December 31, 1995, 1996 and
1997, respectively.) As a result, management expects that this Series, as
well as the Series described below, will report its equity in Project
Partnerships as a loss for tax and financial reporting purposes. Overall
management believes the Project Partnerships are operating as expected and
are generating tax credits which meet projections. However, one Project
Partnership experienced significant operating problems worth noting.
At March 31, 1998, the Series had $286,106 of short-term investments
(Cash and Cash Equivalents). It also had $451,895 in Zero Coupon
Treasuries with annual maturities providing $45,000 in fiscal year 1999
increasing to $86,000 in fiscal year 2008. Management believes the sources
of funds are sufficient to meet current and ongoing operating costs for the
foreseeable future, and to pay part of the Asset Management Fee.
As disclosed on the statement of cash flows, the Series had a net loss
of $1,010,863 for the year ending March 31, 1998. However, after adjusting
for Equity in Losses of Project Partnerships of $909,991 and the changes in
operating assets and liabilities, net cash used in operating activities was
$51,020 of which $41,281 was the Asset Management Fee actually paid. Cash
provided by investing activities totaled $69,146 consisting of $34,057 in
cash distributions from the Project Partnerships and $35,089 from matured
Zero Coupon Treasuries. There were no unusual events or trends to
describe.
A Project Partnership located in Elk Point, SD experienced cash
shortages from operations in 1997due to low occupancy. The local general
partner has funded the deficit by lending $5,080 in 1997 and from $5,000
withdrawn from the property's replacement reserve account. Occupancy was
84% at June 30, 1998. Management does not expect any materially adverse
effect to Gateway from this Project Partnership.
Series 8 - Gateway closed this Series on June 28, 1993 after receiving
$9,980,000 from 664 Limited Partner investors. As of March 31, 1998, the
series had invested $7,586,105 in 43 Project Partnerships located in 18
states containing 1,207 apartment units. Average occupancy of the Project
Partnerships was 95% at December 31, 1997.
Equity in losses of Project Partnerships for the year ended March 31,
1998 of $963,455 was comparable to the years ended March 31, 1997 and 1996.
(These Project Partnerships reported depreciation and amortization of
$1,521,763, $1,652,936 and $1,627,815 for the periods ended December 31,
1995, 1996 and 1997, respectively.) Overall management believes the
Project Partnerships are operating as expected and are generating tax
credits which meet projections.
At March 31, 1998, the Series had $410,727 of short-term investments
(Cash and Cash Equivalents). It also had $427,873 in Zero Coupon
Treasuries with annual maturities providing $45,000 in fiscal year 1999
increasing to $82,000 in fiscal year 2008. Management believes the sources
of funds are sufficient to meet current and ongoing operating costs for the
foreseeable future, and to pay part of the Asset Management Fee.
As disclosed on the statement of cash flows, the Series had a net loss
of $1,060,938 for the year ending March 31, 1998. However, after adjusting
for Equity in Losses of Project Partnerships of $963,455 and the changes
in operating assets and liabilities, net cash used in operating activities
was $45,918 of which $40,379 was the Asset Management Fee actually paid.
Cash provided by investing activities totaled $60,607 consisting of $27,736
received in cash distributions from the Project Partnerships and $32,418
from matured Zero Coupon Treasuries. Management believes the sources of
funds are sufficient to meet current and ongoing operating costs for the
foreseeable future, and to pay part of the Asset Management Fee. There
were no unusual events or trends to describe.
A Project Partnership located in Bridgeport, NE experienced significant
cash shortages from operations in 1997due to low occupancy. The local
general partner has funded the deficit by lending $10,015 in 1997.
Occupancy improved to 92% at June 30, 1998. Management does not expect any
materially adverse effect to Gateway from this Project Partnership.
A Project Partnership located in Russellville, KY experienced cash
shortages from operations in 1997 due to low occupancy. The deficit was
funded using withdrawals from the property's replacement reserve account.
We are in discussion with the local general partner regarding funding the
deficits and working toward a permanent solution. Management does not
expect any materially adverse effect to Gateway from this Project
Partnership.
Series 9 - Gateway closed this Series on September 30, 1993 after
receiving $6,254,000 from 406 Limited Partner investors. As of March 31,
1998, the series had invested $4,914,116 in 24 Project Partnerships located
in 11 states containing 624 apartment units. Average occupancy of the
Project Partnerships was 95% at December 31, 1997.
Equity in losses of Project Partnerships of $459,627 for the year ended
March 31, 1998 were comparable to $508,807 for the year ended March 31,
1997 and to $458,221 for the year ended March 31, 1996. (These Project
Partnerships reported depreciation and amortization of $863,953, $913,666,
and $901,709 for the years ended December 31, 1995, 1996 and 1997,
respectively.) Overall management believes the Project Partnerships are
operating as expected and are generating tax credits which meet
projections.
At March 31, 1998, the Series had $180,104 of short-term investments
(Cash and Cash Equivalents). It also had $286,984 in Zero Coupon
Treasuries with annual maturities providing $29,000 in fiscal year 1999
increasing to $47,000 in fiscal year 2009. Management believes the sources
of funds are sufficient to meet current and ongoing operating costs for the
foreseeable future, and to pay part of the Asset Management Fee.
As disclosed on the statement of cash flows, the Series had net loss of
$512,506 for the period ending March 31, 1998. After adjusting for Equity
in Losses of Project Partnerships of $459,629 and the changes in operating
assets and liabilities, net cash used in operating activities was $23,797
of which $17,861 was the Asset Management Fee actually paid. Cash provided
by investing activities totaled $42,088 consisting of $19,291 received in
cash distributions from the Project Partnerships and $22,797 from matured
Zero Coupon Treasuries. Management believes the sources of funds are
sufficient to meet current and ongoing operating costs for the foreseeable
future, and to pay part of the Asset Management Fee. There were no unusual
events or trends to describe.
Series 10 - Gateway closed this Series on January 21, 1994 after
receiving $5,043,000 from 325 Limited Partner investors. As of March 31,
1998, the series had invested $3,914,672 in 15 Project Partnerships located
in 10 states containing 409 apartment units. Average occupancy of the
Project Partnerships was 96% at December 31, 1997.
Equity in losses of Project Partnerships increased from $167,857 for the
year ended March 31, 1996 to $190,191 for the year ended March 31, 1997 as
properties were acquired and placed in service. Equity in losses of
Project Partnerships was comparable for the year ended March 31, 1998 at
$195,183. (These Project Partnerships reported depreciation and
amortization of $475,696, $516,816 and $511,020 for the years ended
December 31, 1995, 1996, and 1997 respectively.) Overall management
believes the Project Partnerships are operating as expected and are
generating tax credits which meet projections.
At March 31, 1998, the Series had $202,435 of short-term investments
(Cash and Cash Equivalents). It also had $229,390 in Zero Coupon
Treasuries with annual maturities providing $24,000 in fiscal year 1999
increasing to $40,000 in fiscal year 2010. Management believes the sources
of funds are sufficient to meet current and ongoing operating costs for the
foreseeable future, and to pay part of the Asset Management Fee.
As disclosed on the statement of cash flows, the Series had net loss of
$224,779 for the year ending March 31, 1998. After adjusting for Equity in
Losses of Project Partnerships of $195,183 and the changes in operating
assets and liabilities, net cash used in operating activities was $25,089
of which $26,179 was the Asset Management Fee actually paid. Cash provided
by investing activities totaled $27,781 consisting of $17,848 received in
cash distributions from the Project Partnerships, $17,645 from matured Zero
Coupon Treasuries. Management believes the sources of funds are sufficient
to meet current and ongoing operating costs for the foreseeable future, and
to pay part of the Asset Management Fee. There were no unusual events or
trends to describe.
Series 11 - Gateway closed this Series on April 29, 1994 after receiving
$5,127,000 from 330 Limited investors. As of March 31, 1998 the series had
invested $4,128,042 in 12 Project Partnerships located in 7 states
containing 361 apartments. Average occupancy of the Project Partnerships
was 97% at December 31, 1997.
Equity in losses of Project Partnerships increased from $134,308 for the
year ended March 31, 1996 to $182,485 for the year ended March 31, 1997 due
to the number of properties moving from the construction and rent-up phases
to fully operational. Equity in losses of Project Partnerships of $163,364
for the year ended March 31, 1998 was comparable to March 31, 1997. (These
Project Partnerships reported depreciation and amortization of $198,591,
$537,223 and $506,631 for the periods ended December 31, 1995, 1996 and
1997.) Overall management believes the Project Partnerships are operating
as expected and are generating tax credits which meet projections.
At March 31, 1998, the Series had $208,198 of short-term investments
(Cash and Cash Equivalents). It also had $244,562 in Zero Coupon
Treasuries with annual maturities providing $23,000 in fiscal year 1999
increasing to $44,000 in fiscal year 2010. Management believes the sources
of funds are sufficient to meet current and ongoing operating costs for the
foreseeable future, and to pay part of the Asset Management Fee.
As disclosed on the statement of operations interest income decreased
from $69,130 for the year ended March 31, 1996 to $30,465 for the year
ended March 31, 1997 due to the lowering of the average cash balance
available for investment. Interest income of $26,502 for the year ended
March 31, 1998 was comparable to the year ended March 31, 1997.
As disclosed on the statement of cash flows, the Series had net loss of
$183,183 for the year ending March 31, 1998. After adjusting for Equity in
Losses of Project Partnerships of $163,364 and the changes in operating
assets and liabilities, net cash used in operating activities was $16,475
of which $17,943 was the Asset Management Fee actually paid. Cash provided
by investing activities totaled $55,288 consisting of $16,574 from matured
Zero Coupon Treasures and $38,714 received in cash distributions from
Project Partnerships. Management believes the sources of funds are
sufficient to meet current and ongoing operating costs for the foreseeable
future, and to pay part of the Asset Management Fee. There were no unusual
events or trends to describe.
Item 8. Financial Statements and Supplementary Data
INDEPENDENT AUDITOR'S REPORT
To the Partners of Gateway Tax Credit Fund III Ltd.
We have audited the accompanying balance sheets of each of the five Series
(Series 7 through 11) constituting Gateway Tax Credit Fund III Ltd. (a
Florida Limited Partnership) as of March 31, 1998 and 1997 and the related
statements of operations, partners' equity, and cash flows of each of the
five Series for each of the periods presented. These financial statements
are the responsibility of the Partnership's management. Our responsibility
is to express an opinion on these financial statements based on our audits.
We did not audit the financial statements of certain underlying Project
Partnerships owned by Gateway Tax Credit Fund III Ltd. for each of the
periods presented, the investments in which are recorded using the equity
method of accounting. The investments in these partnerships represent the
following percentages of the Partnership's assets as of March 31, 1998 and
1997 and the equity in their losses for each of the periods indicated:
Assets Partnership Loss
March 31, Year Ended March 31,
--------- ---------------------
1998 1997 1998 1997 1996
---- ---- ---- ---- ----
Series 7 55% 58% 59% 63% 54%
Series 8 51% 51% 54% 53% 59%
Series 9 44% 42% 28% 24% 20%
Series 10 56% 54% 33% 20% 28%
Series 11 76% 77% 91% 93% 70%
Those statements were audited by other auditors whose reports have been
furnished to us, and our opinion, insofar as it relates to the amounts
included for such underlying partnerships, is based solely on the reports
of the other auditors.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles
used and significant estimates made by management, as well as evaluating
the overall financial statement presentation. We believe that our audits
and the reports of other auditors provide a reasonable basis for our
opinion.
In our opinion, based on our audits and the reports of other auditors, the
financial statements referred to above present fairly, in all material
respects, the financial position of each of the five Series (Series 7
through 11) constituting Gateway Tax Credit Fund III Ltd. as of March 31,
1998 and 1997, and the results of their operations and their cash flows for
each of the periods presented, in conformity with generally accepted
accounting principles.
Our audits were made for the purpose of forming an opinion on the basic
financial statements taken as a whole. The schedules listed under Item
14(a)(2) in the index are presented for purposes of complying with the
Securities and Exchange Commission's rules and are not part of the basic
financial statements. These schedules have been subjected to the auditing
procedures applied in the audit of the basic financial statements and, in
our opinion, based on our audits and the reports of other auditors, fairly
state in all material respects the financial data required to be set forth
therein in relation to the basic financial statements taken as a whole.
/s/ Spence Marston, Bunch, Morris & Co.
SPENCE, MARSTON, BUNCH, MORRIS & CO.
Certified Public Accountants
Clearwater, Florida
July 2, 1998
PART I - Financial Information
Item 1. Financial Statements
GATEWAY TAX CREDIT FUND III LTD.
(A Florida Limited Partnership)
BALANCE SHEETS
MARCH 31, 1998 AND 1997
SERIES 7 1998 1997
---- ----
ASSETS
Current Assets:
Cash and Cash Equivalents $ 286,106 $ 267,980
Investments in Securities 47,675 44,933
Receivable from Project Partnerships 0 0
----------- ----------
Total Current Assets 333,781 312,913
Investments in Securities 404,220 421,843
Investments in Project Partnerships, Net 3,517,852 4,483,546
----------- ----------
Total Assets $4,255,853 $5,218,302
=========== ==========
LIABILITIES AND PARTNERS' EQUITY
Current Liabilities:
Payable to General Partners 55,760 54,499
Payable to Project Partnerships 0 0
----------- ----------
Total Current Liabilities 55,760 54,499
Long-Term Liabilities:
Payable to General Partners 226,886 179,733
----------- ----------
Partners' Equity:
Limited Partners (10,395 units for Series 7,
9,980 for Series 8, 6,254 for Series 9, 5,043
for Series 10 and 5,127 for Series 11 at
March 31, 1998 and 1997) 4,024,753 5,025,507
General Partners (51,546) (41,437)
----------- ----------
Total Partners' Equity 3,973,207 4,984,070
----------- -----------
Total Liabilities and Partners' Equity $4,255,853 $5,218,302
=========== ===========
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND III LTD.
(A Florida Limited Partnership)
BALANCE SHEETS
MARCH 31, 1998 AND 1997
SERIES 8 1998 1997
---- ----
ASSETS
Current Assets:
Cash and Cash Equivalents $ 410,727 $ 396,038
Investments in Securities 42,967 40,189
Receivable from Project Partnerships 0 453
----------- ----------
Total Current Assets 453,694 436,680
Investments in Securities 384,906 400,823
Investments in Project Partnerships, Net 3,608,229 4,614,122
----------- ----------
Total Assets $4,446,829 $5,451,625
=========== ==========
LIABILITIES AND PARTNERS' EQUITY
Current Liabilities:
Payable to General Partners 46,515 42,185
Payable to Project Partnerships 0 0
---------- ----------
Total Current Liabilities 46,515 42,185
Long-Term Liabilities:
Payable to General Partners 269,107 217,295
Partners' Equity:
Limited Partners (10,395 units for Series 7,
9,980 for Series 8, 6,254 for Series 9, 5,043
for Series 10 and 5,127 for Series 11 at March
31, 1998 and 1997) 4,177,520 5,227,849
General Partners (46,313) (35,704)
----------- -----------
Total Partners' Equity 4,131,207 5,192,145
----------- -----------
Total Liabilities and Partners' Equity $4,446,829 $5,451,625
=========== ===========
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND III LTD.
(A Florida Limited Partnership)
BALANCE SHEETS
MARCH 31, 1998 AND 1997
SERIES 9 1998 1997
---- ----
ASSETS
Current Assets:
Cash and Cash Equivalents $ 180,104 $ 161,813
Investments in Securities 27,803 26,879
Receivable from Project Partnerships 0 0
----------- -----------
Total Current Assets 207,907 188,692
Investments in Securities 259,181 270,520
Investments in Project Partnerships, Net 3,363,377 3,848,367
----------- -----------
Total Assets $3,830,465 $4,307,579
=========== ===========
LIABILITIES AND PARTNERS' EQUITY
Current Liabilities:
Payable to General Partners 26,911 24,250
Payable to Project Partnerships 0 0
----------- -----------
Total Current Liabilities 26,911 24,250
Long-Term Liabilities:
Payable to General Partners 151,733 119,002
Partners' Equity:
Limited Partners (10,395 units for Series 7,
9,980 for Series 8, 6,254 for Series 9, 5,043
for Series 10 and 5,127 for Series 11 at March
31, 1998 and 1997) 3,670,140 4,177,521
General Partners (18,319) (13,194)
----------- -----------
Total Partners' Equity 3,651,821 4,164,327
Total Liabilities and Partners' Equity $ 3,830,465 $4,307,579
============ ===========
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND III LTD.
(A Florida Limited Partnership)
BALANCE SHEETS
MARCH 31, 1998 AND 1997
SERIES 10 1998 1997
---- ----
ASSETS
Current Assets:
Cash and Cash Equivalents $ 202,435 $ 199,743
Investments in Securities 22,865 20,995
Receivable from Project Partnerships 0 0
----------- -----------
Total Current Assets 225,300 220,738
Investments in Securities 206,525 214,600
Investments in Project Partnerships, Net 3,352,669 3,571,518
----------- -----------
Total Assets $3,784,494 $4,006,856
=========== ===========
LIABILITIES AND PARTNERS' EQUITY
Current Liabilities:
Payable to General Partners 30,279 28,072
Payable to Project Partnerships 0 7,712
----------- -----------
Total Current Liabilities 30,279 35,784
Long-Term Liabilities:
Payable to General Partners 45,106 37,184
Partners' Equity:
Limited Partners (10,395 units for Series 7,
9,980 for Series 8, 6,254 for Series 9, 5,043
for Series 10 and 5,127 for Series 11 at March
31, 1999 and 1997) 3,716,198 3,938,729
General Partners (7,089) (4,841)
----------- -----------
Total Partners' Equity 3,709,109 3,933,888
Total Liabilities and Partners' Equity $3,784,494 $4,006,856
=========== ===========
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND III LTD.
(A Florida Limited Partnership)
BALANCE SHEETS
MARCH 31, 1998 AND 1997
SERIES 11 1998 1997
---- ----
ASSETS
Current Assets:
Cash and Cash Equivalents $ 208,198 $ 169,385
Investments in Securities 21,794 19,915
Receivable from Project Partnerships 0 0
----------- ----------
Total Current Assets 229,992 189,300
Investments in Securities 222,768 227,438
Investments in Project Partnerships, Net 3,861,731 4,070,301
----------- -----------
Total Assets $4,314,491 $4,487,039
=========== ===========
LIABILITIES AND PARTNERS' EQUITY
Current Liabilities:
Payable to General Partners 29,179 27,882
Payable to Project Partnerships 0 0
---------- -----------
Total Current Liabilities 29,179 27,882
Long-Term Liabilities:
Payable to General Partners 17,499 8,161
Partners' Equity:
Limited Partners (10,395 units for Series 7,
9,980 for Series 8, 6,254 for Series 9, 5,043
for Series 10 and 5,127 for Series 11 at March
31, 1998 and 1997) 4,271,126 4,452,477
General Partners (3,313) (1,481)
----------- -----------
Total Partners' Equity 4,267,813 4,450,996
----------- -----------
Total Liabilities and Partners' Equity $4,314,491 $4,487,039
=========== ===========
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND III LTD.
(A Florida Limited Partnership)
BALANCE SHEETS
MARCH 31, 1998 AND 1997
TOTAL SERIES 7 -11 1998 1997
---- ----
ASSETS
Current Assets:
Cash and Cash Equivalents $ 1,287,570 $ 1,194,959
Investments in Securities 163,104 152,911
Receivable from Project Partnerships 0 453
------------ ------------
Total Current Assets 1,450,674 1,348,323
Investments in Securities 1,477,600 1,535,224
Investments in Project Partnerships, Net 17,703,858 20,587,854
------------ ------------
Total Assets $20,632,132 23,471,401
LIABILITIES AND PARTNERS' EQUITY
Current Liabilities:
Payable to General Partners 188,644 176,888
Payable to Project Partnerships 0 7,712
------------ -----------
Total Current Liabilities 188,644 184,600
Long-Term Liabilities:
Payable to General Partners 710,331 561,375
Partners' Equity:
Limited Partners (10,395 units for Series 7,
9,980 for Series 8, 6,254 for Series 9,
5,043 for Series 10 and 5,127 for Series 11
at March 31, 1998 and 1997) 19,859,737 22,822,083
General Partner s (126,580) (96,657)
------------ ------------
Total Partners' Equity 19,733,157 22,725,426
Total Liabilities and Partners' Equity $20,632,132 $23,471,401
============ ============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND III LTD.
(A Florida Limited Partnership)
STATEMENTS OF OPERATIONS
FOR THE YEAR ENDED MARCH 31,
SERIES 7 1998 1997 1996
---- ---- ----
Revenues:
Interest Income $ 44,592 $ 43,466 $ 54,373
Expenses:
Asset Management Fee-General
Partner 88,433 80,591 79,980
General and Administrative:
General Partner 14,380 12,039 11,913
Other 21,005 19,895 18,825
Amortization 21,646 21,675 22,048
------------ ------------ -----------
Total Expenses 145,464 134,200 132,766
Loss Before Equity in Losses
of Project Partnerships (100,872) (90,734) (78,393)
Equity in Losses of Project
Partnerships (909,991) (936,184) (936,257)
------------ ------------ ------------
Net Loss $(1,010,863) $(1,026,918) $(1,014,650)
============ ============ ============
Allocation of Net Loss:
Assignees (1,000,754) (1,016,649) (1,004,503)
General Partners (10,109) (10,269) (10,147)
------------ ------------ ------------
$(1,010,863) $(1,026,918) $(1,014,650)
============ ============ ============
Net Loss Per Beneficial
Assignee Certificate (96.27) (97.80) (96.63)
Number of Beneficial Assignee
Certificates Outstanding 10,395 10,395 10,395
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND III LTD.
(A Florida Limited Partnership)
STATEMENTS OF OPERATIONS
FOR THE YEAR ENDED MARCH 31,
SERIES 8 1998 1997 1996
---- ---- ----
Revenues:
Interest Income $ 46,987 $ 48,637 $ 46,431
Expenses:
Asset Management Fee-General
Partner 92,191 88,857 88,183
General and Administrative:
General Partner 15,855 13,275 13,312
Other 21,722 21,160 20,633
Amortization 14,702 14,701 14,994
---------- ------------ -----------
Total Expenses 144,470 137,993 137,122
Loss Before Equity in Losses
of Project Partnerships (97,483) (89,356) (90,691)
Equity in Losses of Project
Partnerships (963,455) (999,833) (1,110,855)
---------- ------------ ------------
Net Loss $(1,060,938) $(1,089,189) $(1,201,546)
=========== ============ ============
Allocation of Net Loss:
Assignees (1,050,329) (1,078,297) (1,189,531)
General Partners (10,609) (10,892) (12,015)
------------ ------------ ------------
$(1,060,938) $(1,089,189) $(1,201,546)
============ ============ ============
Net Loss Per Beneficial
Assignee Certificate (105.56) (108.37) (119.55)
Number of Beneficial Assignee
Certificates Outstanding 9,950 9,950 9,950
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND III LTD.
(A Florida Limited Partnership)
STATEMENTS OF OPERATIONS
FOR THE YEAR ENDED MARCH 31,
SERIES 9 1998 1997 1996
---- ---- ----
Revenues:
Interest Income $ 25,209 $ 25,848 $ 29,092
Expenses:
Asset Management Fee-General
Partner 50,592 49,594 49,218
General and Administrative:
General Partner 8,849 7,410 7,430
Other 12,575 12,122 11,819
Amortization 6,070 7,117 7,117
----------- ------------ -----------
Total Expenses 78,086 76,243 75,584
Loss Before Equity in Losses
of Project Partnerships (52,877) (50,395) (46,492)
Equity in Losses of Project
Partnerships (459,629 (506,807) (458,221)
----------- ----------- -----------
Net Loss $ (512,506) $ (557,202) $ (504,713)
=========== =========== ===========
Allocation of Net Loss:
Assignees (507,381) (551,630) (499,666)
General Partners (5,125) (5,572) (5,047)
----------- ----------- -----------
$ (512,506) $ (557,202) $ (504,713)
=========== =========== ===========
Net Loss Per Beneficial
Assignee Certificate (81.13) (88.20) (79.90)
Number of Beneficial Assignee
Certificates Outstanding 6,254 6,254 6,254
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND III LTD.
(A Florida Limited Partnership)
STATEMENTS OF OPERATIONS
FOR THE YEAR ENDED MARCH 31,
SERIES 10 1998 1997 1996
---- ---- ----
Revenues:
Interest Income $ 24,885 $ 24,953 $ 27,591
Expenses:
Asset Management Fee-General
Partner 34,101 30,997 30,761
General and Administrative:
General Partner 5,531 4,630 4,641
Other 9,031 8,221 7,529
Amortization 5,818 5,837 5,837
----------- ------------ -----------
Total Expenses 54,481 49,685 48,768
Loss Before Equity in Losses
of Project Partnerships (29,596) (24,732) (21,177)
Equity in Losses of Project
Partnerships (195,183) (190,191) (167,857)
----------- ----------- -----------
Net Loss $ (224,779) $ (214,923) $ (189,034)
=========== =========== ===========
Allocation of Net Loss:
Assignees (222,531) (212,774) (187,144)
General Partners (2,248) (2,149) (1,890)
----------- ----------- -----------
$ (224,779) $ (214,923) $ (189,034)
=========== =========== ===========
Net Loss Per Beneficial
Assignee Certificate (44.13) (42.19) (37.11)
Number of Beneficial Assignee
Certificates Outstanding 5,043 5,043 5,043
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND III LTD.
(A Florida Limited Partnership)
STATEMENTS OF OPERATIONS
FOR THE YEAR ENDED MARCH 31,
SERIES 11 1998 1997 1996
---- ---- ----
Revenues:
Interest Income $ 26,502 $ 30,465 $ 69,130
Expenses:
Asset Management Fee-General
Partner 27,281 24,797 24,609
General and Administrative:
General Partner 4,424 3,702 3,654
Other 8,124 8,322 7,475
Amortization 6,492 7,188 7,549
----------- ------------ -----------
Total Expenses 46,321 44,009 43,287
Loss Before Equity in Losses
of Project Partnerships (19,819) (13,544) 25,843
Equity in Losses of Project
Partnerships (163,364) (182,485) (134,308)
----------- ----------- -----------
Net Loss $ (183,183) $ (196,029) $ (108,465)
=========== =========== ===========
Allocation of Net Loss:
Assignees (181,351) (194,069) (107,380)
General Partners (1,832) (1,960) (1,085)
----------- ----------- -----------
$ (183,183) $ (196,029) $ (108,465)
=========== =========== ===========
Net Loss Per Beneficial
Assignee Certificate (35.37) (37.85) (20.94)
Number of Beneficial Assignee
Certificates Outstanding 5,127 5,127 5,127
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND III LTD.
(A Florida Limited Partnership)
STATEMENTS OF OPERATIONS
FOR THE YEAR ENDED MARCH 31,
TOTAL SERIES 7 - 11 1998 1997 1996
---- ---- ----
Revenues:
Interest Income $ 168,175 $ 173,369 $ 226,617
Expenses:
Asset Management Fee-General
Partner 292,598 274,836 272,751
General and Administrative:
General Partner 49,039 41,056 40,950
Other 72,457 69,720 66,281
Amortization 54,728 56,518 57,545
---------- ----------- -----------
Total Expenses 468,822 442,130 437,527
Loss Before Equity in Losses
of Project Partnerships (300,647) (268,761) (210,910)
Equity in Losses of Project
Partnerships (2,691,622) (2,815,500) (2,807,498)
----------- ------------ ------------
Net Loss $(2,992,269) $(3,084,261) $(3,018,408)
=========== ============ ============
Allocation of Net Loss:
Assignees (2,962,346) (3,053,419) (2,988,224)
General Partners (29,923) (30,842) (30,184)
----------- ------------ ------------
$(2,992,269) $(3,084,261) $(3,018,408)
=========== ============ ============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF PARTNERS' EQUITY
FOR THE YEARS ENDED MARCH 31, 1998, 1997 AND 1996:
Limited General
SERIES 7 Partners Partners Total
--------- -------- -----
Balance at March 31, 1995 $ 7,046,659 $ (21,021) $ 7,025,638
Distributions 0 0 0
------------ ------------ ------------
Net Loss (1,004,503) (10,147) (1,014,650)
Balance at March 31, 1996 6,042,156 (31,168) 6,010,988
Net Loss (1,016,649) (10,269) (1,026,918)
------------ ------------ ------------
Balance at March 31, 1997 5,025,507 (41,437) 4,984,070
Net Loss (1,000,754) (10,109) (1,010,863)
------------ ------------ ------------
Balance at March 31, 1998 $ 4,024,753 $ (51,546) $ 3,973,207
============ ============ ============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF PARTNERS' EQUITY
FOR THE YEARS ENDED MARCH 31, 1998, 1997 AND 1996:
Limited General
SERIES 8 Partners Partners Total
--------- -------- -----
Balance at March 31, 1995 $ 7,495,677 $ (12,797) $ 7,482,880
Distributions 0 0 0
------------ ------------ ------------
Net Loss (1,189,531) (12,015) (1,201,546)
Balance at March 31, 1996 6,306,146 (24,812) 6,281,334
Net Loss (1,078,297) (10,892) (1,089,189)
------------ ------------ ------------
Balance at March 31, 1997 5,227,849 (35,704) 5,192,145
Net Loss (1,050,329) (10,609) (1,060,938)
------------ ------------ ------------
Balance at March 31, 1998 $ 4,177,520 $ (46,313) $ 4,131,207
============ ============ ============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF PARTNERS' EQUITY
FOR THE YEARS ENDED MARCH 31, 1998, 1997 AND 1996:
Limited General
SERIES 9 Partners Partners Total
--------- -------- -----
Balance at March 31, 1995 $ 5,228,817 $ (2,575) $ 5,226,242
Distributions 0 0 0
Net Loss (499,666) (5,047) (504,713)
------------ ------------ ------------
Balance at March 31, 1996 4,729,151 (7,622) 4,721,529
Net Loss (551,630) (5,572) (557,202)
------------ ------------ ------------
Balance at March 31, 1997 4,177,521 (13,194) 4,164,327
Net Loss (507,381) (5,125) (512,506)
------------ ------------ ------------
Balance at March 31, 1998 $ 3,670,140 $ (18,319) $ 3,651,821
============ ============ ============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF PARTNERS' EQUITY
FOR THE YEARS ENDED MARCH 31, 1998, 1997 AND 1996:
Limited General
SERIES 10 Partners Partners Total
--------- -------- -----
Balance at March 31, 1995 $ 4,338,647 $ (802) $ 4,337,845
Distributions 0 0 0
Net Loss (187,144) (1,890) (189,034)
------------ ------------ ------------
Balance at March 31, 1996 4,151,503 (2,692) 4,148,811
Net Loss (212,774) (2,149) (214,923)
------------ ------------ ------------
Balance at March 31, 1997 3,938,729 (4,841) 3,933,888
Net Loss (222,531) (2,248) (224,779)
------------ ------------ ------------
Balance at March 31, 1998 $ 3,716,198 $ (7,089) $ 3,709,109
============ ============ ============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF PARTNERS' EQUITY
FOR THE YEARS ENDED MARCH 31, 1998, 1997 AND 1996:
Limited General
SERIES 11 Partners Partners Total
--------- -------- -----
Balance at March 31, 1995 $ 4,800,616 1,564 4,802,180
Distributions (46,690) 0 (46,690)
Net Loss (107,380) (1,085) (108,465)
------------ ------------ ------------
Balance at March 31, 1996 4,646,546 479 4,647,025
Net Loss (194,069) (1,960) (196,029)
------------ ------------ ------------
Balance at March 31, 1997 4,452,477 (1,481) 4,450,996
Net Loss (181,351) (1,832) (183,183)
------------ ------------ ------------
Balance at March 31, 1998 $ 4,271,126 $ (3,313) $ 4,267,813
============ ============ ============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF PARTNERS' EQUITY
FOR THE YEARS ENDED MARCH 31, 1998, 1997 AND 1996:
Limited General
TOTAL SERIES 7 - 11 Partners Partners Total
--------- -------- -----
Balance at March 31, 1995 $28,910,416 $ (35,631) $28,874,785
Distributions (46,690) 0 (46,690)
Net Loss (2,988,224) (30,184) (3,018,408)
------------ ------------ ------------
Balance at March 31, 1996 25,875,502 (65,815) 25,809,687
Net Loss (3,053,419) (30,842) (3,084,261)
------------ ------------ ------------
Balance at March 31, 1997 22,822,083 (96,657) 22,725,426
Net Loss (2,962,346) (29,923) (2,992,269)
------------ ------------ ------------
Balance at March 31, 1998 $19,859,737 $ (126,580) $19,733,157
============ ============ ============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED MARCH 31, 1998, 1997 AND 1996:
SERIES 7 1998 1997 1996
- -------- ---- ---- ----
Cash Flows from Operating
Activities:
Net Loss $(1,010,863) $(1,026,918) $(1,014,650)
Adjustments to Reconcile Net
Loss to Net Cash Provided by
(Used in) Operating Activities:
Amortization 21,646 21,675 22,048
Accreted Interest Income on
Investments in Securities (32,118) (32,259) (32,064)
Equity in Losses of Project
Partnerships 909,991 936,184 936,257
Interest Income from
Redemption of Securities 11,911 8,658 5,751
Changes in Operating Assets
and Liabilities:
Increase in Payable to
General Partners 48,413 41,939 50,803
----------- ----------- -----------
Net Cash Used in Operating
Activities (51,020) (50,721) (31,855)
----------- ----------- -----------
Cash Flows from Investing
Activities:
Investments in Project
Partnerships 0 (3,332) (421,183)
(Increase) Decrease in
Receivable from Project
Partnerships 0 0 0
Acquisition Fees and Expenses 0 (272) (2,142)
Distributions Received from
Project Partnerships 34,057 27,181 23,027
Redemption of Investment in
Securities 35,089 35,342 35,249
Increase (Decrease) in Payable
to Project Partnerships -
Capital Contributions 0 0 0
----------- ----------- -----------
Net Cash Provided by (Used
in) Investing Activities 69,146 58,919 (365,049)
----------- ----------- -----------
Increase (Decrease) in Cash and
Cash Equivalents 18,126 8,198 (396,904)
Cash and Cash Equivalents at
Beginning of Year 267,980 259,782 656,686
----------- ----------- -----------
Cash and Cash Equivalents at
End of Year $ 286,106 $ 267,980 $ 259,782
=========== =========== ===========
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED MARCH 31, 1998, 1997 AND 1996:
SERIES 8 1998 1997 1996
- -------- ---- ---- ----
Cash Flows from Operating
Activities:
Net Loss $(1,060,938) $(1,089,189) $(1,201,546)
Adjustments to Reconcile Net
Loss to Net Cash Provided by
(Used in) Operating Activities:
Amortization 14,702 14,701 14,994
Accreted Interest Income on
Investments in Securities (28,861) (29,020) (28,902)
Equity in Losses of Project
Partnerships 963,455 999,833 1,110,855
Interest Income from
Redemption of Securities 9,582 6,822 4,431
Changes in Operating Assets
and Liabilities:
Increase in Payable to
General Partners 56,142 60,615 69,381
----------- ----------- -----------
Net Cash Used in Operating
Activities (45,918) (36,238) (30,787)
----------- ----------- -----------
Cash Flows from Investing
Activities:
Investments in Project
Partnerships 0 453 107,457
(Increase) Decrease in
Receivable from Project
Partnerships 453 75,574 65,112
Acquisition Fees and Expenses 0 0 0
Distributions Received from
Project Partnerships 27,736 29,050 18,162
Redemption of Investment in
Securities 32,418 32,178 32,569
Increase (Decrease) in Payable
to Project Partnerships -
Capital Contributions 0 0 (241,400)
----------- ----------- -----------
Net Cash Provided by (Used
in) Investing Activities 60,607 137,255 (18,100)
----------- ----------- -----------
Increase (Decrease) in Cash and
Cash Equivalents 14,689 101,017 (48,887)
Cash and Cash Equivalents at
Beginning of Year 396,038 295,021 343,908
----------- ----------- -----------
Cash and Cash Equivalents at
End of Year $ 410,727 $ 396,038 $ 295,021
=========== =========== ===========
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED MARCH 31, 1998, 1997 AND 1996:
SERIES 9 1998 1997 1996
- -------- ---- ---- ----
Cash Flows from Operating
Activities:
Net Loss $ (512,506) $ (557,202) $ (504,713)
Adjustments to Reconcile Net
Loss to Net Cash Provided by
(Used in) Operating Activities:
Amortization 6,070 7,117 7,117
Accreted Interest Income on
Investments in Securities (17,585) (17,836) (17,906)
Equity in Losses of Project
Partnerships 459,629 506,807 458,221
Interest Income from
Redemption of Securities 5,203 3,669 2,190
Changes in Operating Assets
and Liabilities:
Increase in Payable to
General Partners 35,392 40,120 46,588
----------- ----------- -----------
Net Cash Used in Operating
Activities (23,797) (17,325) (8,503)
----------- ----------- -----------
Cash Flows from Investing
Activities:
Investments in Project
Partnerships 0 18,076 29,737
(Increase) Decrease in
Receivable from Project
Partnerships 0 8,545 5,837
Acquisition Fees and Expenses 0 0 (5,124)
Distributions Received from
Project Partnerships 19,291 16,934 14,385
Redemption of Investment in
Securities 22,797 23,331 22,810
Increase (Decrease) in Payable
to Project Partnerships -
Capital Contributions 0 0 (333,006)
----------- ----------- -----------
Net Cash Provided by (Used
in) Investing Activities 42,088 66,886 (265,361)
----------- ----------- -----------
Increase (Decrease) in Cash and
Cash Equivalents 18,291 49,561 (273,864)
Cash and Cash Equivalents at
Beginning of Year 161,813 112,252 386,116
----------- ----------- -----------
Cash and Cash Equivalents at
End of Year $ 180,104 $ 161,813 $ 112,252
=========== =========== ===========
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED MARCH 31, 1998, 1997 AND 1996:
SERIES 10 1998 1997 1996
- -------- ---- ---- ----
Cash Flows from Operating
Activities: $ (224,779) $ (214,923) $ (189,034)
Net Loss
Adjustments to Reconcile Net
Loss to Net Cash Provided by
(Used in) Operating Activities:
Amortization 5,818 5,837 5,837
Accreted Interest Income on
Investments in Securities (15,796) (15,871) (15,771)
Equity in Losses of Project
Partnerships 195,183 190,191 167,857
Interest Income from
Redemption of Securities 4,355 2,874 1,605
Changes in Operating Assets
and Liabilities:
Increase in Payable to
General Partners 10,130 18,380 11,602
----------- ----------- -----------
Net Cash Used in Operating
Activities (25,089) (13,512) (17,904)
----------- ----------- -----------
Cash Flows from Investing
Activities:
Investments in Project
Partnerships 0 0