Attached files
| file | filename |
|---|---|
| EX-32 - BCTC III CERTIFICATION 906 - BOSTON CAPITAL TAX CREDIT FUND III L P | b30916cert906mnt.htm |
| EX-32 - BCTC III CERTIFICATION 906 - BOSTON CAPITAL TAX CREDIT FUND III L P | b30916cert906jpm.htm |
| EX-31 - BCTC III CERTIFICATION 302 - BOSTON CAPITAL TAX CREDIT FUND III L P | b30916cert302mnt.htm |
| EX-31 - BCTC III CERTIFICATION 302 - BOSTON CAPITAL TAX CREDIT FUND III L P | b30916cert302jpm.htm |
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934.
For the quarterly period ended September 30, 2016
or
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from _______ to _______
Commission file number 0-21718
BOSTON CAPITAL TAX CREDIT FUND III L.P.
(Exact name of registrant as specified in its charter)
|
Delaware |
52-1749505 |
|
(State or other jurisdiction |
(I.R.S. Employer |
|
of incorporation or organization) |
Identification No.) |
One Boston Place, Suite 2100, Boston, Massachusetts 02108
(Address of principal executive offices) (Zip Code)
(617) 624-8900
(Registrant's telephone number, including area code)
(Former name, former address and former fiscal year, if changed since last report)
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 ý |
No o |
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).
|
Yes ý |
No |
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer," and "smaller reporting company" in Rule 12b-2 of the Exchange Act (check one):
|
Large accelerated filer o |
Accelerated filer o |
|
Non-accelerated filer o |
Smaller reporting company ý |
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
|
Yes o |
No ý |
BOSTON CAPITAL TAX CREDIT FUND III L.P.
QUARTERLY REPORT ON FORM 10-Q
FOR THE QUARTER ENDED SEPTEMBER 30, 2016
TABLE OF CONTENTS
|
PART I - FINANCIAL INFORMATION |
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Pages |
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Item 1. Condensed Financial Statements |
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Condensed Balance Sheets |
3-8 |
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Condensed Statements of Operations |
9-20 |
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Condensed Statements of Changes in |
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Condensed Statements of Cash Flows |
25-30 |
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Notes to Condensed Financial |
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Item 2. Management's Discussion and Analysis of Financial Condition and Results of |
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Item 3. Quantitative and Qualitative |
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Item 4. Controls and Procedures |
55 |
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PART II - OTHER INFORMATION |
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Item 1. Legal Proceedings |
56 |
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Item 1A. Risk Factors |
56 |
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Item 2. Unregistered Sales of Equity |
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Item 3. Defaults Upon Senior Securities |
56 |
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Item 4. Mine Safety Disclosures |
56 |
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Item 5. Other Information |
56 |
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Item 6. Exhibits |
56 |
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Signatures |
57 |
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Boston Capital Tax Credit Fund III L.P.
CONDENSED BALANCE SHEETS
(Unaudited)
|
|
September 30, |
March 31, |
|
|
ASSETS |
|||
|
Cash and cash equivalents |
$ 1,754,738 |
$ 1,783,433 |
|
|
|
|
||
|
LIABILITIES |
|||
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Accounts payable & accrued expenses |
$ 23,746 |
$ 60,728 |
|
|
Accounts payable affiliates (Note C) |
15,416,582 |
15,273,764 |
|
|
Capital contributions payable (Note D) |
26,447 |
76,455 |
|
|
|
|
||
|
PARTNERS' CAPITAL (DEFICIT) |
|||
|
Assignees 21,996,102 issued and 21,902,747 outstanding as of September 30, 2016 and March 31, 2016
|
(11,819,188) |
(11,735,510) |
|
|
General Partner |
(1,892,849) |
(1,892,004) |
|
|
|
|
||
|
|
|
||
The accompanying notes are an integral part of these condensed statements
Boston Capital Tax Credit Fund III L.P.
CONDENSED BALANCE SHEETS
(Unaudited)
|
|
September 30, |
March 31, |
|
|
ASSETS |
|
|
|
|
Cash and cash equivalents |
$ 67,871 |
$ 116,858 |
|
|
|
|
||
|
LIABILITIES |
|||
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Accounts payable & accrued expenses |
$ 6,246 |
$ 12,744 |
|
|
Accounts payable affiliates (Note C) |
3,022,455 |
3,004,401 |
|
|
Capital contributions payable (Note D) |
- |
- |
|
|
|
|
||
|
PARTNERS' CAPITAL (DEFICIT) |
|||
|
Assignees outstanding as of September 30, 2016 and March 31, 2016 |
(2,609,033) |
(2,549,095) |
|
|
General Partner |
(351,797) |
(351,192) |
|
|
|
|
||
|
|
|
||
The accompanying notes are an integral part of these condensed statements
Boston Capital Tax Credit Fund III L.P.
CONDENSED BALANCE SHEETS
(Unaudited)
|
|
September 30, |
March 31, |
||
|
ASSETS |
|
|||
|
Cash and cash equivalents |
$ 592,700 |
$ 381,450 |
||
|
|
|
|||
|
LIABILITIES |
||||
|
Accounts payable & accrued expenses |
$ - |
$ 10,987 |
||
|
Accounts payable affiliates (Note C) |
8,207,635 |
8,130,679 |
||
|
Capital contributions payable (Note D) |
- |
50,008 |
||
|
|
|
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PARTNERS' CAPITAL (DEFICIT) |
||||
|
Assignees outstanding as of September 30, 2016 and March 31, 2016 |
(7,072,178) |
(7,265,514) |
||
|
General Partner |
(542,757) |
(544,710) |
||
|
|
|
|||
|
|
|
|||
The accompanying notes are an integral part of these condensed statements
Boston Capital Tax Credit Fund III L.P.
CONDENSED BALANCE SHEETS
(Unaudited)
Series 17
|
|
September 30, |
March 31, |
|
ASSETS |
|
|
|
Cash and cash equivalents |
$ 550,318 |
$ 640,398 |
|
|
|
|
|
LIABILITIES |
||
|
Accounts payable & accrued expenses |
$ 10,000 |
$ 16,499 |
|
Accounts payable affiliates (Note C) |
- |
- |
|
Capital contributions payable (Note D) |
7,893 |
7,893 |
|
|
|
|
|
PARTNERS' CAPITAL (DEFICIT) |
||
|
Assignees outstanding as of September 30, 2016 and March 31, 2016
|
899,308 |
982,053 |
|
General Partner |
(366,883) |
(366,047) |
|
|
|
|
|
|
|
The accompanying notes are an integral part of these condensed statements
Boston Capital Tax Credit Fund III L.P.
CONDENSED BALANCE SHEETS
(Unaudited)
Series 18
|
|
September 30, |
March 31, |
|
ASSETS |
|
|
|
Cash and cash equivalents |
$ 319,580 |
$ 353,832 |
|
|
|
|
|
LIABILITIES |
||
|
Accounts payable & accrued expenses |
$ - |
$ 6,499 |
|
Accounts payable affiliates (Note C) |
4,186,492 |
4,138,684 |
|
Capital contributions payable (Note D) |
18,554 |
18,554 |
|
|
|
|
|
PARTNERS' CAPITAL (DEFICIT) |
||
|
Assignees outstanding as of September 30, 2016 and March 31, 2016
|
(3,536,383) |
(3,461,578) |
|
General Partner |
(349,083) |
(348,327) |
|
|
|
|
|
|
|
The accompanying notes are an integral part of these condensed statements
Boston Capital Tax Credit Fund III L.P.
CONDENSED BALANCE SHEETS
(Unaudited)
Series 19
|
|
September 30, |
March 31, |
|
ASSETS |
|
|
|
Cash and cash equivalents |
$ 224,269 |
$ 290,895 |
|
|
|
|
|
LIABILITIES |
||
|
Accounts payable & accrued expenses |
$ 7,500 |
$ 13,999 |
|
Accounts payable affiliates (Note C) |
- |
- |
|
Capital contributions payable (Note D) |
- |
- |
|
|
|
|
|
PARTNERS' CAPITAL (DEFICIT) |
||
|
Assignees outstanding as of September 30, 2016 and March 31, 2016
|
499,098 |
558,624 |
|
General Partner |
(282,329) |
(281,728) |
|
|
|
|
|
|
|
The accompanying notes are an integral part of these condensed statements
Boston Capital Tax Credit Fund III L.P.
CONDENSED STATEMENTS OF OPERATIONS
Three Months Ended September 30,
(Unaudited)
|
|
|
|||
|
Income |
||||
|
Interest income |
$ 808 |
$ 2,565 |
||
|
Other income |
16,812 |
4,504 |
||
|
|
|
|||
|
Share of Income from Operating |
|
|
||
|
Expenses |
||||
|
Professional fees |
97,181 |
102,247 |
||
|
Fund management fee, net (Note C) |
89,842 |
99,876 |
||
|
General and administrative expenses |
97,198 |
29,574 |
||
|
|
|
|
||
|
NET INCOME (LOSS) |
$ (95,640) |
$ 210,133 |
||
|
Net income (loss) allocated to limited assignees |
$ (94,683) |
$ 208,032 |
||
|
Net income (loss) allocated to general partner |
$ (957) |
$ 2,101 |
||
|
Net income (loss) per BAC |
$ .00 |
$ .01 |
||
The accompanying notes are an integral part of these condensed statements
Boston Capital Tax Credit Fund III L.P.
CONDENSED STATEMENTS OF OPERATIONS
Three Months Ended September 30,
(Unaudited)
|
|
|
|||
|
Income |
||||
|
Interest income |
$ 114 |
$ 252 |
||
|
Other income |
321 |
321 |
||
|
|
|
|||
|
Share of Income from Operating |
|
|
|
|
|
Expenses |
||||
|
Professional fees |
22,614 |
23,168 |
||
|
Fund management fee, net (Note C) |
5,777 |
6,527 |
||
|
General and administrative expenses |
18,031 |
5,561 |
||
|
|
|
|
||
|
NET INCOME (LOSS) |
$ (45,987) |
$ (25,361) |
||
|
Net income (loss) allocated to limited assignees |
$ (45,527) |
$ (25,107) |
||
|
Net income (loss) allocated to general partner |
$ (460) |
$ (254) |
||
|
Net income (loss) per BAC |
$ (.01) |
$ (.01) |
||
The accompanying notes are an integral part of these condensed statements
Boston Capital Tax Credit Fund III L.P.
CONDENSED STATEMENTS OF OPERATIONS
Three Months Ended September 30,
(Unaudited)
|
|
|
||
|
Income |
|||
|
Interest income |
$ 258 |
$ 136 |
|
|
Other income |
- |
- |
|
|
|
|
||
|
Share of Income from Operating |
|
|
|
|
Expenses |
|||
|
Professional fees |
22,397 |
26,161 |
|
|
Fund management fee, net (Note C) |
31,815 |
37,720 |
|
|
General and administrative expenses |
23,787 |
6,775 |
|
|
|
|
|
|
|
NET INCOME (LOSS) |
$ 90,720 |
$ 172,480 |
|
|
Net income (loss) allocated to limited assignees |
$ 89,813 |
$ 170,755 |
|
|
Net income (loss) allocated to general partner |
$ 907 |
$ 1,725 |
|
|
Net income (loss) per BAC |
$ .02 |
$ .03 |
|
The accompanying notes are an integral part of these condensed statements
Boston Capital Tax Credit Fund III L.P.
CONDENSED STATEMENTS OF OPERATIONS
Three Months Ended September 30,
(Unaudited)
|
|
|
|||
|
Income |
||||
|
Interest income |
$ 272 |
$ 1,518 |
||
|
Other income |
2,558 |
4,183 |
||
|
|
|
|||
|
Share of Income from Operating |
|
|
||
|
Expenses |
||||
|
Professional fees |
20,211 |
19,173 |
||
|
Fund management fee, net (Note C) |
22,603 |
23,632 |
||
|
General and administrative expenses |
20,654 |
6,406 |
||
|
|
|
|
||
|
NET INCOME (LOSS) |
$ (58,138) |
$ 123,635 |
||
|
Net income (loss) allocated to limited assignees |
$ (57,557) |
$ 122,399 |
||
|
Net income (loss) allocated to general partner |
$ (581) |
$ 1,236 |
||
|
Net income (loss) per BAC |
$ (.01) |
$ .02 |
||
The accompanying notes are an integral part of these condensed statements
Boston Capital Tax Credit Fund III L.P.
CONDENSED STATEMENTS OF OPERATIONS
Three Months Ended September 30,
(Unaudited)
|
|
|
|
|
Income |
||
|
Interest income |
$ 78 |
$ 152 |
|
Other income |
13,933 |
- |
|
|
|
|
|
Share of Income from Operating |
|
|
|
Expenses |
||
|
Professional fees |
17,460 |
20,228 |
|
Fund management fee, net (Note C) |
22,354 |
23,204 |
|
General and administrative expenses |
16,058 |
5,109 |
|
|
|
|
|
NET INCOME (LOSS) |
$ (41,861) |
$ (33,095) |
|
Net income (loss) allocated to limited assignees |
$ (41,442) |
$ (32,764) |
|
Net income (loss) allocated to general partner |
$ (419) |
$ (331) |
|
Net income (loss) per BAC |
$ (.01) |
$ (.01) |
The accompanying notes are an integral part of these condensed statements
Boston Capital Tax Credit Fund III L.P.
CONDENSED STATEMENTS OF OPERATIONS
Three Months Ended September 30,
(Unaudited)
|
|
|
|
|
Income |
||
|
Interest income |
$ 86 |
$ 507 |
|
Other income |
- |
- |
|
|
|
|
|
Share of Income from Operating |
|
|
|
Expenses |
||
|
Professional fees |
14,499 |
13,517 |
|
Fund management fee, net (Note C) |
7,293 |
8,793 |
|
General and administrative expenses |
18,668 |
5,723 |
|
|
|
|
|
NET INCOME (LOSS) |
$ (40,374) |
$ (27,526) |
|
Net income (loss) allocated to limited assignees |
$ (39,970) |
$ (27,251) |
|
Net income (loss) allocated to general partner |
$ (404) |
$ (275) |
|
Net income (loss) per BAC |
$ (.01) |
$ (.01) |
The accompanying notes are an integral part of these condensed statements
Boston Capital Tax Credit Fund III L.P.
CONDENSED STATEMENTS OF OPERATIONS
Six Months Ended September 30,
(Unaudited)
|
|
|
|||
|
Income |
||||
|
Interest income |
$ 1,616 |
$ 3,842 |
||
|
Other income |
26,440 |
21,125 |
||
|
|
|
|||
|
Share of Income from Operating |
|
|
|
|
|
Expenses |
||||
|
Professional fees |
123,483 |
128,887 |
||
|
Fund management fee, net (Note C) |
172,181 |
109,688 |
||
|
General and administrative expenses |
135,499 |
46,963 |
||
|
|
|
|
||
|
NET INCOME (LOSS) |
$ (84,523) |
$ 6,024,918 |
||
|
Net income (loss) allocated to limited assignees |
$ (83,678) |
$ 5,964,669 |
||
|
Net income (loss) allocated to general partner |
$ (845) |
$ 60,249 |
||
|
Net income (loss) per BAC |
$ (.00) |
$ .27 |
||
The accompanying notes are an integral part of these condensed statements
Boston Capital Tax Credit Fund III L.P.
CONDENSED STATEMENTS OF OPERATIONS
Six Months Ended September 30,
(Unaudited)
Series 15
|
|
|
|||
|
Income |
||||
|
Interest income |
$ 262 |
$ 437 |
||
|
Other income |
321 |
321 |
||
|
|
|
|||
|
Share of Income from Operating |
|
|
|
|
|
Expenses |
||||
|
Professional fees |
28,518 |
29,288 |
||
|
Fund management fee, net (Note C) |
8,092 |
(51,509) |
||
|
General and administrative expenses |
24,516 |
8,927 |
||
|
|
|
|
||
|
NET INCOME (LOSS) |
$ (60,543) |
$ 349,143 |
||
|
Net income (loss) allocated to limited assignees |
$ (59,938) |
$ 345,652 |
||
|
Net income (loss) allocated to general partner |
$ (605) |
$ 3,491 |
||
|
Net income (loss) per BAC |
$ (.02) |
$ .09 |
||
The accompanying notes are an integral part of these condensed statements
Boston Capital Tax Credit Fund III L.P.
CONDENSED STATEMENTS OF OPERATIONS
Six Months Ended September 30,
(Unaudited)
Series 16
|
|
|
||
|
Income |
|||
|
Interest income |
$ 470 |
$ 257 |
|
|
Other income |
603 |
401 |
|
|
|
|
||
|
Share of Income from Operating |
|
|
|
|
Expenses |
|||
|
Professional fees |
28,896 |
32,941 |
|
|
Fund management fee, net (Note C) |
61,010 |
76,010 |
|
|
General and administrative expenses |
31,962 |
10,729 |
|
|
|
|
|
|
|
NET INCOME (LOSS) |
$ 195,289 |
$ 123,978 |
|
|
Net income (loss) allocated to limited assignees |
$ 193,336 |
$ 122,738 |
|
|
Net income (loss) allocated to general partner |
$ 1,953 |
$ 1,240 |
|
|
Net income (loss) per BAC |
$ .04 |
$ .02 |
|
The accompanying notes are an integral part of these condensed statements
Boston Capital Tax Credit Fund III L.P.
CONDENSED STATEMENTS OF OPERATIONS
Six Months Ended September 30,
(Unaudited)
Series 17
|
|
|
|||
|
Income |
||||
|
Interest income |
$ 542 |
$ 1,832 |
||
|
Other income |
11,500 |
20,320 |
||
|
|
|
|||
|
Share of Income from Operating |
2,500 |
|
5,692,104 |
|
|
Expenses |
||||
|
Professional fees |
25,267 |
24,303 |
||
|
Fund management fee, net (Note C) |
42,535 |
21,943 |
||
|
General and administrative expenses |
30,321 |
10,002 |
||
|
|
|
|
||
|
NET INCOME (LOSS) |
$ (83,581) |
$ 5,658,008 |
||
|
Net income (loss) allocated to limited assignees |
$ (82,745) |
$ 5,601,428 |
||
|
Net income (loss) allocated to general partner |
$ (836) |
$ 56,580 |
||
|
Net income (loss) per BAC |
$ (.02) |
$ 1.12 |
||
The accompanying notes are an integral part of these condensed statements
Boston Capital Tax Credit Fund III L.P.
CONDENSED STATEMENTS OF OPERATIONS
Six Months Ended September 30,
(Unaudited)
Series 18
|
|
|
|
|
Income |
||
|
Interest income |
$ 163 |
$ 309 |
|
Other income |
13,933 |
- |
|
|
|
|
|
Share of Income from Operating |
|
|
|
Expenses |
||
|
Professional fees |
22,482 |
25,358 |
|
Fund management fee, net (Note C) |
45,208 |
46,408 |
|
General and administrative expenses |
21,967 |
8,245 |
|
|
|
|
|
NET INCOME (LOSS) |
$ (75,561) |
$ (64,408) |
|
Net income (loss) allocated to limited assignees |
$ (74,805) |
$ (63,764) |
|
Net income (loss) allocated to general partner |
$ (756) |
$ (644) |
|
Net income (loss) per BAC |
$ (.02) |
$ (.02) |
The accompanying notes are an integral part of these condensed statements
Boston Capital Tax Credit Fund III L.P.
CONDENSED STATEMENTS OF OPERATIONS
Six Months Ended September 30,
(Unaudited)
Series 19
|
|
|
|
|
Income |
||
|
Interest income |
$ 179 |
$ 1,007 |
|
Other income |
83 |
83 |
|
|
|
|
|
Share of Income from Operating |
|
|
|
Expenses |
||
|
Professional fees |
18,320 |
16,997 |
|
Fund management fee, net (Note C) |
15,336 |
16,836 |
|
General and administrative expenses |
26,733 |
9,060 |
|
|
|
|
|
NET INCOME (LOSS) |
$ (60,127) |
$ (41,803) |
|
Net income (loss) allocated to limited assignees |
$ (59,526) |
$ (41,385) |
|
Net income (loss) allocated to general partner |
$ (601) |
$ (418) |
|
Net income (loss) per BAC |
$ (.01) |
$ (.01) |
The accompanying notes are an integral part of these condensed statements
Boston Capital Tax Credit Fund III L.P.
CONDENSED STATEMENTS OF CHANGES IN PARTNERS' CAPITAL (DEFICIT)
Six Months Ended September 30, 2016
(Unaudited)
|
|
|
|
|
|
Partners' capital |
|
|
|
|
(83,678) |
(845) |
(84,523) |
|
|
Partners' capital |
|
|
|
The accompanying notes are an integral part of these condensed statements
Boston Capital Tax Credit Fund III L.P.
CONDENSED STATEMENTS OF CHANGES IN PARTNERS' CAPITAL (DEFICIT)
Six Months Ended September 30, 2016
(Unaudited)
|
|
General |
Total |
|
|
|
|||
|
Partners' capital |
|
|
|
|
Net income (loss) |
(59,938) |
(605) |
(60,543) |
|
Partners' capital |
|
|
|
|
|
|||
|
Partners' capital |
|
|
|
|
Net income (loss) |
193,336 |
1,953 |
195,289 |
|
Partners' capital |
|
|
|
The accompanying notes are an integral part of these condensed statements
Boston Capital Tax Credit Fund III L.P.
CONDENSED STATEMENTS OF CHANGES IN PARTNERS' CAPITAL (DEFICIT)
Six Months Ended September 30, 2016
(Unaudited)
|
|
General |
Total |
|
|
|
|||
|
Partners' capital |
|
|
|
|
Net income (loss) |
(82,745) |
(836) |
(83,581) |
|
Partners' capital |
|
|
|
|
|
|||
|
Partners' capital |
|
|
|
|
Net income (loss) |
(74,805) |
(756) |
(75,561) |
|
Partners' capital |
|
|
|
The accompanying notes are an integral part of these condensed statements
Boston Capital Tax Credit Fund III L.P.
CONDENSED STATEMENTS OF CHANGES IN PARTNERS' CAPITAL (DEFICIT)
Six Months Ended September 30, 2016
(Unaudited)
|
|
General |
Total |
|
|
|
|||
|
Partners' capital |
|
|
|
|
Net income (loss) |
(59,526) |
(601) |
(60,127) |
|
Partners' capital |
|
|
|
The accompanying notes are an integral part of these condensed statements
Boston Capital Tax Credit Fund III L.P.
CONDENSED STATEMENTS OF CASH FLOWS
Six Months Ended September 30,
(Unaudited)
|
2016 |
2015 |
|||
|
Cash flows from operating activities: |
||||
|
Net Income (Loss) |
$ (84,523) |
$ 6,024,918 |
||
|
Adjustments to reconcile net income |
||||
|
Share of Income from |
|
|
||
|
Changes in assets and liabilities |
||||
|
(Decrease) Increase in accounts payable and accrued expenses |
(36,982) |
12,750 |
||
|
Decrease in other assets |
- |
2,200 |
||
|
(Decrease) Increase in accounts |
|
|
||
|
Net cash (used in) provided by |
|
|
||
|
Cash flows from investing activities: |
||||
|
Proceeds from the disposition of |
|
|
||
|
Net cash provided by |
|
|
||
|
INCREASE (DECREASE) IN CASH AND |
|
|
||
|
Cash and cash equivalents, beginning |
1,783,433 |
2,523,234 |
||
|
Cash and cash equivalents, ending |
$ 1,754,738 |
$ 8,372,695 |
||
The accompanying notes are an integral part of these condensed statements
Boston Capital Tax Credit Fund III L.P.
CONDENSED STATEMENTS OF CASH FLOWS
Six Months Ended September 30,
(Unaudited)
Series 15
|
2016 |
2015 |
|||
|
Cash flows from operating activities: |
||||
|
Net Income (Loss) |
$ (60,543) |
$ 349,143 |
||
|
Adjustments to reconcile net income |
||||
|
Share of Income from |
|
|
||
|
Changes in assets and liabilities |
||||
|
(Decrease) Increase in accounts payable and accrued expenses |
|
|
||
|
Decrease in other assets |
- |
- |
||
|
(Decrease) Increase in accounts |
|
|
||
|
Net cash (used in) provided by |
|
|
||
|
Cash flows from investing activities: |
||||
|
Proceeds from the disposition of |
- |
335,091 |
||
|
Net cash provided by |
- |
335,091 |
||
|
INCREASE (DECREASE) IN CASH AND |
|
|
||
|
Cash and cash equivalents, beginning |
116,858 |
414,859 |
||
|
Cash and cash equivalents, ending |
$ 67,871 |
$ 523,919 |
||
The accompanying notes are an integral part of these condensed statements
Boston Capital Tax Credit Fund III L.P.
CONDENSED STATEMENTS OF CASH FLOWS
Six Months Ended September 30,
(Unaudited)
Series 16
|
2016 |
2015 |
|||
|
Cash flows from operating activities: |
||||
|
Net Income (Loss) |
$ 195,289 |
$ 123,978 |
||
|
Adjustments to reconcile net income |
||||
|
Share of Income from |
|
|
||
|
Changes in assets and liabilities |
||||
|
(Decrease) Increase in accounts payable and accrued expenses |
|
|
||
|
Decrease in other assets |
- |
- |
||
|
(Decrease) Increase in accounts |
|
|
||
|
Net cash (used in) provided by |
|
|
||
|
Cash flows from investing activities: |
||||
|
Proceeds from the disposition of |
266,076 |
243,000 |
||
|
Net cash provided by |
266,076 |
243,000 |
||
|
INCREASE (DECREASE) IN CASH AND |
|
|
||
|
Cash and cash equivalents, beginning |
381,450 |
221,108 |
||
|
Cash and cash equivalents, ending |
$ 592,700 |
$ 359,929 |
||
The accompanying notes are an integral part of these condensed statements
Boston Capital Tax Credit Fund III L.P.
CONDENSED STATEMENTS OF CASH FLOWS
Six Months Ended September 30,
(Unaudited)
Series 17
|
2016 |
2015 |
|||
|
Cash flows from operating activities: |
||||
|
Net Income (Loss) |
$ (83,581) |
$ 5,658,008 |
||
|
Adjustments to reconcile net income |
||||
|
Share of Income from |
|
|
||
|
Changes in assets and liabilities |
||||
|
(Decrease) Increase in accounts payable and accrued expenses |
|
|
||
|
Decrease in other assets |
- |
2,200 |
||
|
(Decrease) Increase in accounts |
|
|
||
|
|
|
|||
|
Net cash (used in) provided by |
|
|
||
|
Cash flows from investing activities: |
||||
|
Proceeds from the disposition of |
|
|
||
|
Net cash provided by |
|
|
||
|
INCREASE (DECREASE) IN CASH AND |
|
|
||
|
Cash and cash equivalents, beginning |
640,398 |
197,779 |
||
|
Cash and cash equivalents, ending |
$ 550,318 |
$ 5,807,762 |
||
The accompanying notes are an integral part of these condensed statements
Boston Capital Tax Credit Fund III L.P.
CONDENSED STATEMENTS OF CASH FLOWS
Six Months Ended September 30,
(Unaudited)
Series 18
|
2016 |
2015 |
|||
|
Cash flows from operating activities: |
||||
|
Net Income (Loss) |
$ (75,561) |
$ (64,408) |
||
|
Adjustments to reconcile net income |
||||
|
Share of Income from |
|
|
||
|
Changes in assets and liabilities |
||||
|
(Decrease) Increase in accounts payable and accrued expenses |
|
|
||
|
Decrease in other assets |
- |
- |
||
|
(Decrease) Increase in accounts |
|
|
||
|
Net cash (used in) provided by |
|
|
||
|
Cash flows from investing activities: |
||||
|
Proceeds from the disposition of |
|
|
||
|
Net cash provided by |
|
|
||
|
INCREASE (DECREASE) IN CASH AND |
|
|
||
|
Cash and cash equivalents, beginning |
353,832 |
306,518 |
||
|
Cash and cash equivalents, ending |
$ 319,580 |
$ 339,918 |
||
The accompanying notes are an integral part of these condensed statements
Boston Capital Tax Credit Fund III L.P.
CONDENSED STATEMENTS OF CASH FLOWS
Six Months Ended September 30,
(Unaudited)
Series 19
|
2016 |
2015 |
|||
|
Cash flows from operating activities: |
||||
|
Net Income (Loss) |
$ (60,127) |
$ (41,803) |
||
|
Adjustments to reconcile net income |
||||
|
Share of Income from |
|
|
||
|
Changes in assets and liabilities |
||||
|
(Decrease) Increase in accounts payable and accrued expenses |
|
|
||
|
Decrease in other assets |
- |
- |
||
|
(Decrease) Increase in accounts |
|
|
||
|
Net cash (used in) provided by |
|
|
||
|
Cash flows from investing activities: |
||||
|
Proceeds from the disposition of |
- |
- |
||
|
Net cash provided by |
- |
- |
||
|
INCREASE (DECREASE) IN CASH AND |
|
|
||
|
Cash and cash equivalents, beginning |
290,895 |
1,382,970 |
||
|
Cash and cash equivalents, ending |
$ 224,269 |
$ 1,341,167 |
||
The accompanying notes are an integral part of these condensed statements
Boston Capital Tax Credit Fund III L.P.
NOTES TO CONDENSED FINANCIAL STATEMENTS
September 30, 2016
(Unaudited)
Boston Capital Tax Credit Fund III L.P. (the "Fund") was formed under the laws of the State of Delaware as of September 19, 1991 for the purpose of acquiring, holding, and disposing of limited partnership interests in operating partnerships which will acquire, develop, rehabilitate, operate and own newly constructed, existing or rehabilitated low-income apartment complexes ("Operating Partnerships"). Effective as of June 1, 2001 there was a restructuring, and as a result, the Fund's general partner was reorganized as follows. The general partner of the Fund continues to be Boston Capital Associates III L.P., a Delaware limited partnership. The general partner of the general partner of the Fund is now BCA Associates Limited Partnership, a Massachusetts limited partnership, whose sole general partner is C&M Management, Inc., a Massachusetts corporation whose limited partners are Herbert F. Collins and John P. Manning. Mr. Manning is the principal of Boston Capital Partners, Inc. The limited partner of the general partner is Capital Investment Holdings, a general partnership whose partners are various officers and employees of Boston Capital Partners, Inc. and its affiliates. The assignor limited partner is BCTC III Assignor Corp., a Delaware corporation which is wholly-owned by Herbert F. Collins and John P. Manning.
Pursuant to the Securities Act of 1933, the Fund filed a Form S-11 Registration Statement with the Securities and Exchange Commission, effective January 24, 1992 which covered the offering (the "Public Offering") of the Fund's beneficial assignee certificates ("BACs") representing assignments of units of the beneficial interest of the limited partnership interest of the assignor limited partner. The Fund registered 20,000,000 BACs at $10 per BAC for sale to the public in one or more series. On September 4, 1993 the Fund filed an amendment to Form S-11 with the Securities and Exchange Commission which registered an additional 2,000,000 BACs at $10 per BAC for sale to the public in one or more series. The registration for the additional BACs became effective on October 6, 1993. Offers and sales of BACs in Series 15 through 19 of the Fund were completed and the last of the BACs in Series 15, 16, 17, 18 and 19 were issued by the Fund on September 26, 1992, December 28, 1992, September 17, 1993, September 22, 1993, and December 17, 1993, respectively. The Fund sold 3,870,500 of Series 15 BACs, for a total of $38,705,000; 5,429,402 of Series 16 BACs, for a total of $54,293,000; 5,000,000 of Series 17 BACs, for a total of $50,000,000; 3,616,200 of Series 18 BACs, for a total of $36,162,000; and 4,080,000 of Series 19 BACs, for a total of $40,800,000. As of September 30, 2016, 3,848,900 BACs in Series 15, 5,404,500 BACs in Series 16, 4,972,947 BACs in Series 17, 3,605,200 BACs in Series 18, and 4,071,200 BACs in Series 19, respectively, are outstanding. The Fund issued the last BACs in Series 19 on December 17, 1993. This concluded the Public Offering of the Fund.
Boston Capital Tax Credit Fund III L.P.
NOTES TO CONDENSED FINANCIAL STATEMENTS - CONTINUED
September 30, 2016
NOTE B - ACCOUNTING AND FINANCIAL REPORTING POLICIES
The condensed financial statements included herein as of September 30, 2016 and for the three and six months then ended have been prepared by the Fund, without audit. The Fund accounts for its investments in Operating Partnerships using the equity method, whereby the Fund adjusts its investment cost for its share of each Operating Partnership's results of operations and for any distributions received or accrued. Costs incurred by the Fund in acquiring the investments in the Operating Partnerships are capitalized to the investment account.
The Fund's accounting and financial reporting policies are in conformity with generally accepted accounting principles and include adjustments in interim periods considered necessary for a fair presentation of the results of operations. Such adjustments are of a normal recurring nature. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations. It is suggested that these condensed financial statements be read in conjunction with the financial statements and notes thereto included in the Fund's Annual Report on Form 10-K for the fiscal year ended March 31, 2016.
Boston Capital Tax Credit Fund III L.P.
NOTES TO CONDENSED FINANCIAL STATEMENTS - CONTINUED
September 30, 2016
(Unaudited)
NOTE C - RELATED PARTY TRANSACTIONS
The Fund has entered into several transactions with various affiliates of its general partner, including Boston Capital Holdings LP, Boston Capital Partners, Inc., and Boston Capital Asset Management Limited Partnership, as follows:
An annual fund management fee, based on .5 percent of the aggregate cost of all apartment complexes owned by the Operating Partnerships, has been accrued to Boston Capital Asset Management Limited Partnership. Since reporting fees collected by the series were added to reserves and not paid to Boston Capital Asset Management Limited Partnership, the amounts accrued are not net of reporting fees received. The fund management fees accrued for the three months ended September 30, 2016 and 2015 are as follows:
|
2016 |
2015 |
|
|
Series 15 |
$ 9,027 |
$ 13,511 |
|
Series 16 |
33,735 |
44,070 |
|
Series 17 |
21,603 |
26,532 |
|
Series 18 |
23,904 |
23,904 |
|
Series 19 |
8,793 |
8,793 |
|
$ 97,062 |
$116,810 |
The fund management fees paid for the three months ended September 30, 2016 and 2015 are as follows:
|
2016 |
2015 |
|
|
Series 15 |
$ - |
$ 278,475 |
|
Series 16 |
- |
82,001 |
|
Series 17 |
21,603 |
26,532 |
|
Series 18 |
- |
305,289 |
|
Series 19 |
8,793 |
8,793 |
|
$ 30,396
|
$ 701,090 |
The fund management fees paid for the six months ended September 30, 2016 and 2015 are as follows:
|
2016 |
2015 |
|
|
Series 15 |
$ - |
$ 278,475 |
|
Series 16 |
- |
82,001 |
|
Series 17 |
43,632 |
113,915 |
|
Series 18 |
- |
305,289 |
|
Series 19 |
17,586 |
17,586 |
|
$ 61,218
|
$ 797,266 |
Boston Capital Tax Credit Fund III L.P.
NOTES TO CONDENSED FINANCIAL STATEMENTS - CONTINUED
September 30, 2016
(Unaudited)
NOTE D - INVESTMENTS IN OPERATING PARTNERSHIPS
At September 30, 2016 and 2015, the Fund had limited partnership interests in 57 and 62 Operating Partnerships, respectively, which own or are constructing apartment complexes. The breakdown of Operating Partnerships within the Fund at September 30, 2016 and 2015 is as follows:
|
2016 |
2015 |
|
|
Series 15 |
14 |
15 |
|
Series 16 |
17 |
20 |
|
Series 17 |
8 |
9 |
|
Series 18 |
12 |
12 |
|
Series 19 |
6 |
6 |
|
57 |
62 |
Under the terms of the Fund's investment in each Operating Partnership, the Fund is required to make capital contributions to the Operating Partnerships. These contributions are payable in installments over several years upon each Operating Partnership achieving specified levels of construction and/or operations. The contributions payable at September 30, 2016 and 2015 are as follows:
|
2016 |
2015 |
|
|
Series 15 |
$ - |
$ - |
|
Series 16 |
- |
50,008 |
|
Series 17 |
7,893 |
7,893 |
|
Series 18 |
18,554 |
18,554 |
|
Series 19 |
- |
- |
|
$ 26,447 |
$ 76,455 |
During the six months ended September 30, 2016 the Fund disposed of four Operating Partnerships. A summary of the dispositions by Series for September 30, 2016 is as follows:
|
Operating |
Sale of |
Fund Proceeds |
Gain on |
||||||
|
Series 15 |
- |
- |
$ |
- |
$ |
- |
|||
|
Series 16 |
2 |
1 |
266,076 |
316,084 |
|||||
|
Series 17 |
1 |
- |
2,500 |
2,500 |
|||||
|
Series 18 |
- |
- |
- |
- |
|||||
|
Series 19 |
- |
- |
- |
- |
|||||
|
Total |
3 |
1 |
$ |
268,576 |
$ |
318,584 |
|||
* Fund proceeds from disposition does not include $50,008 which was due to a writeoff of capital contribution payable in Series 16.
Boston Capital Tax Credit Fund III L.P.
NOTES TO CONDENSED FINANCIAL STATEMENTS - CONTINUED
September 30, 2016
(Unaudited)
NOTE D - INVESTMENTS IN OPERATING PARTNERSHIPS (continued)
During the six months ended September 30, 2015 the Fund disposed of eight Operating Partnerships and the Fund received additional proceeds from one operating limited partnership disposed of in the prior year. A summary of the dispositions by Series for September 30, 2015 is as follows:
|
Operating |
Sale of |
Fund Proceeds |
Gain on |
||||||
|
Series 15 |
2 |
1 |
$ |
335,091 |
$ |
335,091 |
|||
|
Series 16 |
1 |
- |
243,000 |
243,000 |
|||||
|
Series 17 |
3 |
1 |
5,692,104 |
5,692,104 |
|||||
|
Series 18 |
- |
- |
370,583 |
15,294 |
|||||
|
Series 19 |
- |
- |
- |
- |
|||||
|
Total |
6 |
2 |
$ |
6,640,778 |
$ |
6,285,489 |
|||
* Fund proceeds from disposition include $355,289 which was receivable as of March 31, 2015 for Series 18.
The gain described above is for financial statement purposes only. There are significant differences between the equity method of accounting and the tax reporting of income and losses from Operating Partnership investments. The largest difference is the ability, for tax purposes, to deduct losses in excess of the Fund's investment in the Operating Partnership. As a result, the amount of gain recognized for tax purposes may be significantly higher than the gain recorded in the condensed financial statements.
The Fund's fiscal year ends March 31st of each year, while all the Operating Partnerships' fiscal years are the calendar year. Pursuant to the provisions of each Operating Partnership Agreement, financial results for each of the Operating Partnerships are provided to the Fund within 45 days after the close of each Operating Partnerships quarterly period. Accordingly, the current financial results available for the Operating Partnerships are for the six months ended June 30, 2016.
Boston Capital Tax Credit Fund III L.P.
NOTES TO CONDENSED FINANCIAL STATEMENTS - CONTINUED
September 30, 2016
(Unaudited)
NOTE D - INVESTMENTS IN OPERATING PARTNERSHIPS (continued)
COMBINED CONDENSED SUMMARIZED STATEMENTS OF OPERATIONS
Six Months Ended June 30,
(Unaudited)
|
2016 |
2015 |
|
|
Revenues |
||
|
Rental |
$ 5,211,464 |
$ 6,316,814 |
|
Interest and other |
101,215 |
131,891 |
|
5,312,679 |
6,448,705 |
|
|
Expenses |
||
|
Interest |
633,554 |
784,026 |
|
Depreciation and amortization |
1,291,363 |
1,657,094 |
|
Operating expenses |
4,190,981 |
4,750,149 |
|
|
|
|
|
NET LOSS |
$ (803,219) |
$ (742,564) |
|
Net loss allocation to Boston |
|
|
|
Net loss allocated to other |
|
|
* Amounts include $795,185 and $735,137 for 2016 and 2015, respectively, of loss not recognized under the equity method of accounting.
The Fund accounts for its investments using the equity method of
accounting. Under the equity method of accounting, the Fund adjusts
its investment cost for its share of each Operating Partnership's results of
operations and for any distributions received or accrued. However, the
Fund recognizes individual operating losses only to the extent of
capital contributions. Excess losses are suspended for use in future years to
offset excess income.
Boston Capital Tax Credit Fund III L.P.
NOTES TO CONDENSED FINANCIAL STATEMENTS - CONTINUED
September 30, 2016
(Unaudited)
NOTE D - INVESTMENTS IN OPERATING PARTNERSHIPS (continued)
COMBINED CONDENSED SUMMARIZED STATEMENTS OF OPERATIONS
Six Months Ended June 30,
(Unaudited)
|
2016 |
2015 |
|
|
Revenues |
||
|
Rental |
$ 1,174,081 |
$ 1,349,023 |
|
Interest and other |
26,849 |
30,803 |
|
1,200,930 |
1,379,826 |
|
|
Expenses |
||
|
Interest |
154,795 |
182,807 |
|
Depreciation and amortization |
279,803 |
339,402 |
|
Operating expenses |
885,807 |
1,038,780 |
|
|
|
|
|
NET LOSS |
$ (119,475) |
$ (181,163) |
|
Net loss allocation to Boston |
|
|
|
Net loss allocated to other |
|
|
* Amounts include $118,280 and $179,351 for 2016 and 2015, respectively, of loss not recognized under the equity method of accounting.
The Fund accounts for its investments using the equity method of
accounting. Under the equity method of accounting, the Fund adjusts
its investment cost for its share of each Operating Partnership's results of
operations and for any distributions received or accrued. However, the
Fund recognizes individual operating losses only to the extent of
capital contributions. Excess losses are suspended for use in future years to
offset excess income.
Boston Capital Tax Credit Fund III L.P.
NOTES TO CONDENSED FINANCIAL STATEMENTS - CONTINUED
September 30, 2016
(Unaudited)
NOTE D - INVESTMENTS IN OPERATING PARTNERSHIPS (continued)
COMBINED CONDENSED SUMMARIZED STATEMENTS OF OPERATIONS
Six Months Ended June 30,
(Unaudited)
Series 16
|
2016 |
2015 |
|
|
Revenues |
||
|
Rental |
$ 1,639,035 |
$ 2,336,187 |
|
Interest and other |
24,810 |
39,794 |
|
1,663,845 |
2,375,981 |
|
|
Expenses |
||
|
Interest |
197,987 |
295,892 |
|
Depreciation and amortization |
366,909 |
598,462 |
|
Operating expenses |
1,318,902 |
1,631,545 |
|
|
|
|
|
NET LOSS |
$ (219,953) |
$ (149,918) |
|
Net loss allocation to Boston |
|
|
|
Net loss allocated to other |
|
|
|
|
||
* Amounts include $217,753 and $148,419 for 2016 and 2015, respectively, of loss not recognized under the equity method of accounting.
The Fund accounts for its investments using the equity method of
accounting. Under the equity method of accounting, the Fund adjusts
its investment cost for its share of each Operating Partnership's results of
operations and for any distributions received or accrued. However, the
Fund recognizes individual operating losses only to the extent of
capital contributions. Excess losses are suspended for use in future years to
offset excess income.
Boston Capital Tax Credit Fund III L.P.
NOTES TO CONDENSED FINANCIAL STATEMENTS - CONTINUED
September 30, 2016
(Unaudited)
NOTE D - INVESTMENTS IN OPERATING PARTNERSHIPS (continued)
COMBINED CONDENSED SUMMARIZED STATEMENTS OF OPERATIONS
Six Months Ended June 30,
(Unaudited)
Series 17
|
2016 |
2015 |
|
|
Revenues |
||
|
Rental |
$ 1,026,457 |
$ 1,221,132 |
|
Interest and other |
17,039 |
21,168 |
|
1,043,496 |
1,242,300 |
|
|
Expenses |
||
|
Interest |
106,241 |
145,301 |
|
Depreciation and amortization |
314,896 |
362,917 |
|
Operating expenses |
800,813 |
915,707 |
|
|
|
|
|
NET LOSS |
$ (178,454) |
$ (181,625) |
|
Net loss allocation to Boston |
|
|
|
Net loss allocated to other |
|
|
|
|
|
|
* Amounts include $176,668 and $179,808 for 2016 and 2015, respectively, of loss not recognized under the equity method of accounting.
The Fund accounts for its investments using the equity method of
accounting. Under the equity method of accounting, the Fund adjusts
its investment cost for its share of each Operating Partnership's results of
operations and for any distributions received or accrued. However, the
Fund recognizes individual operating losses only to the extent of
capital contributions. Excess losses are suspended for use in future years to
offset excess income.
Boston Capital Tax Credit Fund III L.P.
NOTES TO CONDENSED FINANCIAL STATEMENTS - CONTINUED
September 30, 2016
(Unaudited)
NOTE D - INVESTMENTS IN OPERATING PARTNERSHIPS (continued)
COMBINED CONDENSED SUMMARIZED STATEMENTS OF OPERATIONS
Six Months Ended June 30,
(Unaudited)
Series 18
|
2016 |
2015 |
|
|
Revenues |
||
|
Rental |
$ 999,311 |
$ 1,040,147 |
|
Interest and other |
21,479 |
30,360 |
|
1,020,790 |
1,070,507 |
|
|
Expenses |
||
|
Interest |
128,750 |
110,648 |
|
Depreciation and amortization |
247,517 |
284,019 |
|
Operating expenses |
861,838 |
840,923 |
|
|
|
|
|
NET LOSS |
$ (217,315) |
$ (165,083) |
|
Net loss allocation to Boston |
|
|
|
Net loss allocated to other |
|
|
The Fund accounts for its investments using the equity method of
accounting. Under the equity method of accounting, the Fund adjusts
its investment cost for its share of each Operating Partnership's results of
operations and for any distributions received or accrued. However, the
Fund recognizes individual operating losses only to the extent of
capital contributions. Excess losses are suspended for use in future years to
offset excess income.
Boston Capital Tax Credit Fund III L.P.
NOTES TO CONDENSED FINANCIAL STATEMENTS - CONTINUED
September 30, 2016
(Unaudited)
NOTE D - INVESTMENTS IN OPERATING PARTNERSHIPS (continued)
COMBINED CONDENSED SUMMARIZED STATEMENTS OF OPERATIONS
Six Months Ended June 30,
(Unaudited)
Series 19
|
2016 |
2015 |
|
|
Revenues |
||
|
Rental |
$ 372,580 |
$ 370,325 |
|
Interest and other |
11,038 |
9,766 |
|
383,618 |
380,091 |
|
|
Expenses |
||
|
Interest |
45,781 |
49,378 |
|
Depreciation and amortization |
82,238 |
72,294 |
|
Operating expenses |
323,621 |
323,194 |
|
|
|
|
|
NET LOSS |
$ (68,022) |
$ (64,775) |
|
Net loss allocation to Boston |
|
|
|
Net loss allocated to other |
|
|
* Amounts include $67,342 and $64,127 for 2016 and 2015, respectively, of loss not recognized under the equity method of accounting.
The Fund accounts for its investments using the equity method of
accounting. Under the equity method of accounting, the Fund adjusts
its investment cost for its share of each Operating Partnership's results of
operations and for any distributions received or accrued. However, the
Fund recognizes individual operating losses only to the extent of
capital contributions. Excess losses are suspended for use in future years to
offset excess income.
Boston Capital Tax Credit Fund III L.P.
NOTES TO CONDENSED FINANCIAL STATEMENTS - CONTINUED
September 30, 2016
(Unaudited)
NOTE E - TAXABLE LOSS
The Fund's taxable loss for the calendar year ended December 31, 2016 is expected to differ from its loss for financial reporting purposes. This is primarily due to accounting differences in depreciation incurred by the Operating Partnerships and also differences between the equity method of accounting and the IRS accounting methods.
NOTE F - INCOME TAXES
The Fund has elected to be treated as a pass-through entity for income tax purposes and, as such, is not subject to income taxes. Rather, all items of taxable income, deductions and tax credits are passed through to and are reported by its owners on their respective income tax returns. The Fund's federal tax status as a pass-through entity is based on its legal status as a partnership. Accordingly, the Fund is not required to take any tax positions in order to qualify as a pass-through entity. The Fund is required to file and does file tax returns with the Internal Revenue Service and other taxing authorities. Accordingly, these financial statements do not reflect a provision for income taxes and the Fund has no other tax positions which must be considered for disclosure.
Income tax returns filed by the Fund are subject to examination by the Internal Revenue Service for a period of three years. While no income tax returns are currently being examined by the Internal Revenue Service, tax years since 2012 remain open.
NOTE G - SUBSEQUENT EVENTS
Events that occur after the balance sheet date but before the financial statements were available to be issued must be evaluated for recognition or disclosure. The effects of subsequent events that provide evidence about conditions that existed at the balance sheet date are recognized in the accompanying financial statements. Subsequent events, which provide evidence about conditions that existed after the balance sheet date, require disclosure in the accompanying notes. Management evaluated the activity of the Fund through the date the financial statements were issued, and concluded that no subsequent events have occurred that would require recognition in the financial statements or disclosure in the notes to the financial statements.
Boston Capital Tax Credit Fund III L.P.
NOTES TO CONDENSED FINANCIAL STATEMENTS - CONTINUED
September 30, 2016
(Unaudited)
NOTE H - Plan of Liquidation
On March 30, 2016, our General Partner recommended that the BAC holders approve a plan of liquidation and dissolution for the Partnership, or the "Plan." The Plan was approved by the BAC holders on June 1, 2016, and was adopted by the General Partner on June 1, 2016. Pursuant to the Plan, the General Partner would be able to, without further action by the BAC holders:
- liquidate the assets and wind up the business of the Partnership;
- make liquidating distributions in cancellation of the BACs, if any;
- dissolve the Partnership after the sale of all of the Partnership's assets; and
- take, or cause the Partnership to take, such other acts and deeds and shall do, or cause the Partnership to do, such other things, as are necessary or appropriate in connection with the dissolution, winding up and liquidation of the Partnership, the termination of the responsibilities and liabilities of the Partnership under applicable law, and the termination of the existence of the Partnership.
Since the approval of the Plan by the BAC holders, we have continued to seek to sell the assets of the Partnership and use the sale proceeds and/or other Partnership funds to pay all expenses in connection with such sales, pay or make provision for payment of all Partnership obligations and liabilities, including accrued fees, and unpaid loans to the General Partner, and distribute the remaining assets as set forth in the Partnership Agreement. We expect to complete the sale of the apartment complexes approximately three to five years after the BAC holders approval of the Plan, which was June 1, 2016. However, because of numerous uncertainties, the liquidation may take longer or shorter than expected, and the final liquidating distributions, if any, may occur months after all of the apartment complexes of any given Series have been sold. As liquidation is not imminent, the Partnership will continue to report as a going concern.
For additional information regarding the sale of Partnership assets, see "Management's Discussion and Analysis of Financial Condition and Results of Operations" in this Annual Report on Form 10-K.
Item 2. Management's Discussions and Analysis of Financial Condition and
Results of Operations
This Management's Discussion and Analysis of Financial Condition and Results of Operations contains forward-looking statements including our intentions, hopes, beliefs, expectations, strategies and predictions of our future activities, or other future events or conditions. These statements are "forward looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and are intended to be covered by the safe harbors created by these acts. Investors are cautioned that all forward-looking statements involve risks and uncertainty, including, for example, the factors identified in Part I, Item 1A. "Risk Factors" of our Annual Report on Form 10-K for the fiscal year ended March 31, 2016. Although we believe that the assumptions underlying these forward-looking statements are reasonable, any of the assumptions could be inaccurate, and there can be no assurance that the forward-looking statements included in this Report will prove to be accurate. In light of the significant uncertainties inherent in these forward-looking statements, the inclusion of this information should not be regarded as a representation by us or any other person that our objectives and plans will be achieved.
The Fund's primary source of funds was the proceeds of its Public Offering. Other sources of liquidity include (i) interest earned on capital contributions unpaid for the six months ended September 30, 2016 or on working capital reserves, (ii) cash distributions from operations of the Operating Partnerships in which the Fund has invested and (iii) proceeds received from the dispositions of the Operating Partnership that are returned to fund reserves. These sources of liquidity, along with the Fund's working capital reserve, are available to meet the obligations of the Partnership. The Fund does not anticipate significant cash distributions from operations of the Operating Partnerships.
The Fund is currently accruing the fund management fee. Fund management fees accrued during the quarter ended September 30, 2016 were $97,062 and total fund management fees accrued as of September 30, 2016 were $15,416,582. During the three months ended September 30, 2016, $30,396 of accrued fund management fees were paid. Pursuant to the Partnership Agreement, these liabilities will be deferred until the Fund receives proceeds from sales of the Operating Partnerships, which will be used to satisfy these liabilities. The Fund's working capital and sources of liquidity coupled with affiliated party liability accruals allow sufficient levels of liquidity to meet the third party obligations of the Fund. The Fund is currently unaware of any trends which would create insufficient liquidity to meet future third party obligations of the Fund.
The Fund offered BACs in a Public Offering declared effective by the Securities and Exchange Commission on January 24, 1992. The Fund received $38,705,000, $54,293,000, $50,000,000, $36,162,000 and $40,800,000 representing 3,870,500, 5,429,402, 5,000,000, 3,616,200 and 4,080,000 BACs from investors admitted as BAC Holders in Series 15, Series 16, Series 17, Series 18, and Series 19, respectively. The Public Offering was completed on December 17, 1993.
(Series 15) The Fund commenced offering BACs in Series 15 on January 24, 1992. Offers and sales of BACs in Series 15 were completed on September 26, 1992. The Fund has committed proceeds to pay initial and additional installments of capital contributions to 68 Operating Partnerships in the amount of $28,257,701. Series 15 has since sold its interest in 54 of the Operating Partnerships.
During the quarter ended September 30, 2016, none of Series 15 net offering proceeds were used to pay capital contributions. No additional net offering proceeds remain to be used by the Fund to pay capital contributions to the Operating Partnerships that Series 15 has invested in as of September 30, 2016.
(Series 16) The Fund commenced offering BACs in Series 16 on July 13, 1992. Offers and sales of BACs in Series 16 were completed on December 28, 1992. The Fund has committed proceeds to pay initial and additional installments of capital contributions to 64 Operating Partnerships in the amount of $39,579,774. Series 16 has since sold its interest in 47 of the Operating Partnerships.
During the quarter ended September 30, 2016, none of Series 16 net offering proceeds were used to pay capital contributions. No additional net offering proceeds remain to be used by the Fund to pay capital contributions to the Operating Partnerships that Series 16 has invested in as of September 30, 2016.
(Series 17) The Fund commenced offering BACs in Series 17 on January 24, 1993. Offers and sales of BACs in Series 17 were completed on September 17, 1993. The Fund has committed proceeds to pay initial and additional installments of capital contributions to 49 Operating Partnerships in the amount of $36,538,204. Series 17 has since sold its interest in 41 of the Operating Partnerships.
During the quarter ended September 30, 2016, none of Series 17 net offering proceeds were used to pay capital contributions. Series 17 has contributions payable to 1 Operating Partnership in the amount of $7,893 as of September 30, 2016. The remaining contributions will be released to the Operating Partnership when it has achieved the conditions set forth in its partnership agreement.
(Series 18) The Fund commenced offering BACs in Series 18 on September 17, 1993. Offers and sales of BACs in Series 18 were completed on September 22, 1993. The Fund has committed proceeds to pay initial and additional installments of capital contributions to 34 Operating Partnerships in the amount of $26,442,202. Series 18 has since sold its interest in 22 of the Operating Partnerships.
During the quarter ended September 30, 2016, none of Series 18 net offering proceeds were used to pay capital contributions. Series 18 has contributions payable to 2 Operating Partnerships in the amount of $18,554 as of September 30, 2016. The remaining contributions will be released to the Operating Partnerships when they have achieved the conditions set forth in their partnership agreements.
(Series 19) The Fund commenced offering BACs in Series 19 on October 8, 1993. Offers and sales of BACs in Series 19 were completed on December 17, 1993. The Fund has committed proceeds to pay initial and additional installments of capital contributions to 26 Operating Partnerships in the amount of $29,614,506. Series 19 has since sold its interest in 20 of the Operating Partnerships.
During the quarter ended September 30, 2016, none of Series 19 net offering proceeds were used to pay capital contributions. No additional net offering proceeds remain to be used by the Fund to pay capital contributions to the Operating Partnerships that Series 19 has invested in as of September 30, 2016.
As of September 30, 2016 and 2015, the Fund held limited partnership interests in 57 and 62 Operating Partnerships, respectively. In each instance the apartment complex owned by the applicable Operating Partnership is eligible for the federal housing tax credit. Initial occupancy of a unit in each apartment complex which complied with the minimum set-aside test (i.e., initial occupancy by tenants with incomes equal to no more than a certain percentage of area median income) and the rent restriction test (i.e., gross rent charged tenants does not exceed 30% of the applicable income standards) is referred to as "Qualified Occupancy." Each of the Operating Partnerships and each of the respective apartment complexes are described more fully in the Prospectus or applicable report on Form 8-K. The general partner of the Fund believes that there is adequate casualty insurance on the properties.
The Fund incurs a fund management fee to Boston Capital Asset Management Limited Partnership (formerly Boston Capital Communications Limited Partnership), or BCAMLP, in an amount equal to .5 percent of the aggregate cost of the apartment complexes owned by the Operating Partnerships, less the amount of various asset management and reporting fees paid by the Operating Partnerships. The fund management fees incurred and the reporting fees paid by the Operating Partnerships for the three and six months ended September 30, 2016 are as follows:
|
3 Months |
|
3 Months Fund |
|
|
Series 15 |
$ 9,027 |
$ 3,250 |
$ 5,777 |
|
Series 16 |
33,735 |
1,920 |
31,815 |
|
Series 17 |
21,603 |
(1,000) |
22,603 |
|
Series 18 |
23,904 |
1,550 |
22,354 |
|
Series 19 |
8,793 |
1,500 |
7,293 |
|
$ 97,062 |
$ 7,220 |
$ 89,842 |
|
|
6 Months |
6 Months |
6 Months Fund |
|
|
Series 15 |
$ 18,054 |
$ 9,962 |
$ 8,092 |
|
Series 16 |
76,956 |
15,946 |
61,010 |
|
Series 17 |
43,632 |
1,097 |
42,535 |
|
Series 18 |
47,808 |
2,600 |
45,208 |
|
Series 19 |
17,586 |
2,250 |
15,336 |
|
$204,036 |
$ 31,855 |
$ 172,181 |
The Fund's investment objectives do not include receipt of significant cash distributions from the Operating Partnerships in which it has invested or intends to invest. The Fund's investments in Operating Partnerships have been made principally with a view towards realization of federal housing tax credits for allocation to its partners and BAC holders.
Series 15
As of September 30, 2016 and 2015, the average Qualified Occupancy for the series was 100%. The series had a total of 14 properties September 30, 2016, all of which were at 100% Qualified Occupancy.
For the six month periods ended September 30, 2016 and 2015, Series 15 reflects a net loss from Operating Partnerships of $(119,475) and $(181,163), respectively, which includes depreciation and amortization of $279,803 and $339,402, respectively. This is an interim period estimate; it is not indicative of the final year end results.
Livingston Plaza, Limited (Livingston Plaza) is a 24-unit, family property located in Livingston, Texas. Due to low economic occupancy and a lack of qualified applicants the property operates at or just below breakeven. The operating general partner's operating deficit guarantee has expired. The operating general partner has informed the investment general partner that it is exploring various disposition strategies for this property. The investment general partner has concluded that these strategies would be consistent with the investment objectives of the investment partnership and that it is unlikely that any proceeds will be available for distribution to the investment limited partnership when disposition of the Operating Partnership occurs at some point in the future. The 15-year low income housing tax credit compliance period with respect to Livingston Plaza expired on December 31, 2008.
In February 2015, the operating general partner of Graham Housing Limited Partnership entered into an agreement to sell the property to a non-affiliated entity and the transaction closed on April 28, 2015. The sales price of the property was $1,425,000, which included the outstanding mortgage balance of approximately $817,589 and cash proceeds to the investment partnership of $402,258. Of the total proceeds received by the investment partnership, $73,489 represents reporting fees due to an affiliate of the investment partnership and the balance represents proceeds from the sale. Of the remaining proceeds, $3,000 was paid to BCAMLP for expenses related to the sale, which include third party legal costs. The remaining proceeds from the sale of $325,769 were returned to cash reserves held by Series 15. The monies held in cash reserves will be utilized to pay current operating expenses, accrued but unpaid asset management fees, and accrued but unpaid expenses of the investment partnership. After all outstanding obligations of the investment partnership are satisfied, any remaining monies will be distributed based on the number of BACs held by each investor at the time of distribution. Annual losses generated by the Operating Partnership, which were applied against the investment limited partnership investment in the Operating Partnership in accordance with the equity method of accounting, had previously reduced the investment limited partnership investment in the Operating Partnership to zero. Accordingly, a gain on the sale of the Operating Partnership, net of the overhead and expense reimbursement, has been recorded in the amount of $325,769 as of June 30, 2015.
In July 2015, the investment general partner transferred its interest in Deerfield Associates Limited Partnership to an entity affiliated with the operating general partner for its assumption of the outstanding mortgage balance of approximately $1,124,981 and cash proceeds to the investment partnership of $10,000. Of the total proceeds received, $2,750 was paid to BCAMLP for expenses related to the transfer, which include third party legal costs. The remaining proceeds of approximately $7,250 were returned to cash reserves held by Series 15. The monies held in cash reserves will be utilized to pay current operating expenses, accrued but unpaid asset management fees, and accrued but unpaid expenses of the investment partnership. After all outstanding obligations of the investment partnership are satisfied, any remaining monies will be distributed based on the number of BACs held by each investor at the time of distribution. In addition, the investment general partner on behalf of the investment partnership entered into a residual receipt promissory note (the" RRN") with the Operating Partnership for receipt of a residual payment. Under the terms of the RRN, if there is a capital transaction involving the property owned by the Operating Partnership at any time within 15 years from the initial transfer date, there would be a residual payment distributable to the investment partnership in accordance with the terms of the RRN. Annual losses generated by the Operating Partnership, which were applied against the investment limited partnership investment in the Operating Partnership in accordance with the equity method of accounting, had previously reduced the investment limited partnership investment in the Operating Partnership to zero. Accordingly, a gain on the transfer of the Operating Partnership, net of the overhead and expense reimbursement, has been recorded in the amount of $7,250 as of September 30, 2015.
In July 2015 the investment general partner transferred its interest in East Machias Limited Partnership to an entity affiliated with the operating general partner for its assumption of the outstanding mortgage balance of approximately $943,748 and cash proceeds to the investment partnership of $2,072. The total proceeds of approximately $2,072 were returned to cash reserves held by Series 15. The monies held in cash reserves will be utilized to pay current operating expenses, accrued but unpaid asset management fees, and accrued but unpaid expenses of the investment partnership. After all outstanding obligations of the investment partnership are satisfied, any remaining monies will be distributed based on the number of BACs held by each investor at the time of distribution. Annual losses generated by the Operating Partnership, which were applied against the investment limited partnership investment in the Operating Partnership in accordance with the equity method of accounting, had previously reduced the investment limited partnership investment in the Operating Partnership to zero. Accordingly, a gain on the transfer of the Operating Partnership, net of the overhead and expense reimbursement, has been recorded in the amount of $2,072 as of September 30, 2015.
In December 2015 the investment general partner transferred its interest in P.D.C Fifty Five LP to an entity affiliated with the operating general partner for its assumption of the outstanding mortgage balance of approximately $1,153,060 and cash proceeds to the investment partnership of $133,600. Of the total proceeds received, $3,000 was paid to BCAMLP for expenses related to the transfer, which include third party legal costs. The remaining proceeds of approximately $130,600 were returned to cash reserves held by Series 15. The monies held in cash reserves will be utilized to pay current operating expenses, accrued but unpaid asset management fees, and accrued but unpaid expenses of the investment partnership. After all outstanding obligations of the investment partnership are satisfied, any remaining monies will be distributed based on the number of BACs held by each investor at the time of distribution. Annual losses generated by the Operating Partnership, which were applied against the investment limited partnership investment in the Operating Partnership in accordance with the equity method of accounting, had previously reduced the investment limited partnership investment in the Operating Partnership to zero. Accordingly, a gain on the transfer of the Operating Partnership, net of the overhead and expense reimbursement, has been recorded in the amount of $130,600 as of December 31, 2015.
The investment general partner will continue to monitor the following Operating Partnerships because of operational or other issues. However, these Operating Partnerships have all exited their LIHTC compliance period and there is therefore no risk to past credit delivery.
Beckwood Manor Eight Limited Partnership
Sunset Square Limited Partnership
University Meadows L.D.H.A. Limited Partnership
Series 16
As of September 30, 2016 and 2015, the average Qualified Occupancy for the series was 100%. The series had a total of 17 properties at September 30, 2016, all of which were at 100% Qualified Occupancy.
For the six month periods ended September 30, 2016 and 2015, Series 16 reflects a net loss from Operating Partnerships of $(219,953) and $(149,918), respectively, which includes depreciation and amortization of $366,909 and $598,462, respectively. This is an interim period estimate; it is not indicative of the final year end results.
In August 2015, the investment general partner transferred its interest in St. Croix Commons Limited Partnership to an entity affiliated with the operating general partner for its assumption of the outstanding mortgage balance of approximately $1,192,312 and cash proceeds to the investment partnership of $250,000. Of the total proceeds received, $7,000 was paid to BCAMLP for expenses related to the transfer, which include third party legal costs. The remaining proceeds of approximately $243,000 were returned to cash reserves held by Series 16. The monies held in cash reserves will be utilized to pay current operating expenses, accrued but unpaid asset management fees, and accrued but unpaid expenses of the investment partnership. After all outstanding obligations of the investment partnership are satisfied, any remaining monies will be distributed based on the number of BACs held by each investor at the time of distribution. Annual losses generated by the Operating Partnership, which were applied against the investment limited partnership investment in the Operating Partnership in accordance with the equity method of accounting, had previously reduced the investment limited partnership investment in the Operating Partnership to zero. Accordingly, a gain on the transfer of the Operating Partnership, net of the overhead and expense reimbursement, has been recorded in the amount of $243,000 as of September 30, 2015.
In June 2016, the investment general partner of Series 16 and Boston Capital Tax Credit Fund IV - Series 23 transferred their respective interests in Mid City Associates Limited Partnership to an entity affiliated with the operating general partner for its assumption of the outstanding mortgage balance of approximately $4,890,361 and cash proceeds to the investment partnerships of $124,955 and $4,545, for Series 16 and Series 23, respectively. Of the total proceeds received, $27,340 and $995, for Series 16 and Series 23, respectively, was paid to BCAMLP for expenses related to the transfer, which include third party legal costs. The remaining proceeds of approximately $97,615 and $3,550, for Series 16 and Series 23, respectively, were returned to cash reserves. The monies held in cash reserves will be utilized to pay current operating expenses, accrued but unpaid asset management fees, and accrued but unpaid expenses of the investment partnership. After all outstanding obligations of the investment partnership are satisfied, any remaining monies will be distributed based on the number of BACs held by each investor at the time of distribution. Annual losses generated by the Operating Partnership, which were applied against the investment limited partnership investment in the Operating Partnership in accordance with the equity method of accounting, had previously reduced the investment limited partnership investment in the Operating Partnership to zero. Accordingly, a gain on the transfer of the Operating Partnership, net of the overhead and expense reimbursement, has been recorded in the amount of $97,615 and $3,550, for Series 16 and Series 23, respectively, as of June 30, 2016. In addition, equity outstanding for the Operating Partnership in the amount of $50,008 for Series 16 was recorded as gain on the transfer of the Operating Partnership as of June 30, 2016.
In July 2016, the investment general partner transferred its interest in Stony Ground Villas, Limited Partnership to a non-affiliated entity for its assumption of the outstanding mortgage balance of approximately $1,254,826 and cash proceeds to the investment partnership of $30,000. Of the total proceeds received, $3,000 was paid to BCAMLP for expenses related to the transfer, which include third party legal costs. The remaining proceeds of approximately $27,000 were returned to cash reserves held by Series 16. The monies held in cash reserves will be utilized to pay current operating expenses, accrued but unpaid asset management fees, and accrued but unpaid expenses of the investment partnership. After all outstanding obligations of the investment partnership are satisfied, any remaining monies will be distributed based on the number of BACs held by each investor at the time of distribution. Annual losses generated by the Operating Partnership, which were applied against the investment limited partnership investment in the Operating Partnership in accordance with the equity method of accounting, had previously reduced the investment limited partnership investment in the Operating Partnership to zero. Accordingly, a gain on the transfer of the Operating Partnership, net of the overhead and expense reimbursement, has been recorded in the amount of $27,000 as of September 30, 2016.
In September 2016, the investment general partner sold its interest in Idabel Properties, Limited Partnership to an entity affiliated with the operating general partner. The sales price of the property was $1,359,124, which included the outstanding mortgage balance of approximately $1,215,163 and cash proceeds to the investment partnership of $143,961. Of the total proceeds received by the investment partnership, $2,500 was paid to BCAMLP for expenses related to the sale, which include third party legal costs. The remaining proceeds from the sale of $141,461 were returned to cash reserves held by Series 16. The monies held in cash reserves will be utilized to pay current operating expenses, accrued but unpaid asset management fees, and accrued but unpaid expenses of the investment partnership. After all outstanding obligations of the investment partnership are satisfied, any remaining monies will be distributed based on the number of BACs held by each investor at the time of distribution. Annual losses generated by the Operating Partnership, which were applied against the investment limited partnership investment in the Operating Partnership in accordance with the equity method of accounting, had previously reduced the investment limited partnership investment in the Operating Partnership to zero. Accordingly, a gain on the sale of the Operating Partnership, net of the overhead and expense reimbursement, has been recorded in the amount of $141,461 as of September 30, 2016.
The investment general partner will continue to monitor the following Operating Partnerships because of operational or other issues. However, these Operating Partnerships have all exited their LIHTC compliance period and there is therefore no risk to past credit delivery.
Anson Limited Partnership
Falcon Ridge, Limited Partnership
Greenfield Properties, Limited Partnership
Series 17
As of September 30, 2016 and 2015, the average Qualified Occupancy for the series was 100%. The series had a total of 8 properties at September 30, 2016, all of which were at 100% Qualified Occupancy.
For the six month periods ended September 30, 2016 and 2015, Series 17 reflects a net loss from Operating Partnerships of $(178,454) and $(181,625), respectively, which includes depreciation and amortization of $314,896 and $362,917, respectively. This is an interim period estimate; it is not indicative of the final year end results.
In December 2013, the investment general partner transferred 99% of its interest in Quail Village LP to a non-affiliated entity for its assumption of the outstanding mortgage balance of approximately $799,778 and cash proceeds to the investment partnership of $20,000. Of the total proceeds received, $8,221 represents reporting fees due to an affiliate of the investment partnership and the balance represents proceeds from the transfer. Of the remaining proceeds, $5,000 will be paid to BCAMLP for expenses related to the transfer, which include third party legal costs. The remaining proceeds of approximately $6,779 were returned to cash reserves held by Series 17. The remaining 1% investment limited partner interest in the Operating Partnership transferred in July 2015. The monies held in cash reserves will be utilized to pay current operating expenses, accrued but unpaid asset management fees, and accrued but unpaid expenses of the investment partnership. After all outstanding obligations of the investment partnership are satisfied, any remaining monies will be distributed based on the number of BACs held by each investor at the time of distribution. Annual losses generated by the Operating Partnership, which were applied against the investment limited partnership investment in the Operating Partnership in accordance with the equity method of accounting, had previously reduced the investment limited partnership investment in the Operating Partnership to zero. Accordingly, a gain on the 99% transfer of the Operating Partnership, net of the overhead and expense reimbursement, has been recorded in the amount of $6,779 as of December 31, 2013. In July 2015, the remaining 1% of interest was transferred to a non-affiliated entity resulting in no proceeds or gain on the transaction.
In April 2015, the operating general partner of Henson Creek Manor Associates Limited Partnership entered into an agreement to sell the property to a non-affiliated entity and the transaction closed on June 16, 2015. The sales price of the property was $12,752,326, which included the outstanding mortgage balance of approximately $4,293,415 and cash proceeds to the investment partnership of $5,541,959. Of the total proceeds received by the investment partnership, $17,000 was paid to BCAMLP for expenses related to the sale, which include third party legal costs. The remaining proceeds from the sale of $5,524,959 were returned to cash reserves held by Series 17. The monies held in cash reserves will be utilized to pay current operating expenses, accrued but unpaid asset management fees, and accrued but unpaid expenses of the investment partnership. After all outstanding obligations of the investment partnership are satisfied, any remaining monies will be distributed based on the number of BACs held by each investor at the time of distribution. Annual losses generated by the Operating Partnership, which were applied against the investment limited partnership investment in the Operating Partnership in accordance with the equity method of accounting, had previously reduced the investment limited partnership investment in the Operating Partnership to zero. Accordingly, a gain on the sale of the Operating Partnership, net of the overhead and expense reimbursement, has been recorded in the amount of $5,524,959 as of June 30, 2015. In August 2015, additional proceeds of $160,000 were received and returned to the cash reserves held by Series 17 resulting in an additional gain on sale.
In August 2015, the investment general partner transferred its interest in Green Acres Limited Partnership to an entity affiliated with the operating general partner for its assumption of the outstanding mortgage balance of approximately $845,218 and cash proceeds to the investment partnership of $2,385. The total proceeds of approximately $2,385 were returned to cash reserves held by Series 17. The monies held in cash reserves will be utilized to pay current operating expenses, accrued but unpaid asset management fees, and accrued but unpaid expenses of the investment partnership. After all outstanding obligations of the investment partnership are satisfied, any remaining monies will be distributed based on the number of BACs held by each investor at the time of distribution. Annual losses generated by the Operating Partnership, which were applied against the investment limited partnership investment in the Operating Partnership in accordance with the equity method of accounting, had previously reduced the investment limited partnership investment in the Operating Partnership to zero. Accordingly, a gain on the transfer of the Operating Partnership, net of the overhead and expense reimbursement, has been recorded in the amount of $2,385 as of September 30, 2015.
In August 2015, the investment general partner transferred its interest in Skowhegan Housing Limited Partnership to an entity affiliated with the operating general partner for its assumption of the outstanding mortgage balance of approximately $1,266,135 cash proceeds to the investment partnership of $4,760. The total proceeds of approximately $4,760 were returned to cash reserves held by Series 17. The monies held in cash reserves will be utilized to pay current operating expenses, accrued but unpaid asset management fees, and accrued but unpaid expenses of the investment partnership. After all outstanding obligations of the investment partnership are satisfied, any remaining monies will be distributed based on the number of BACs held by each investor at the time of distribution. Annual losses generated by the Operating Partnership, which were applied against the investment limited partnership investment in the Operating Partnership in accordance with the equity method of accounting, had previously reduced the investment limited partnership investment in the Operating Partnership to zero. Accordingly, a gain on the transfer of the Operating Partnership, net of the overhead and expense reimbursement, has been recorded in the amount of $4,760 as of September 30, 2015.
In August 2016, the investment general partner transferred its interest in White Castle Senior Citizen Partnership to an entity affiliated with the operating general partner for its assumption of the outstanding mortgage balance of approximately $703,433 and cash proceeds to the investment partnership of $5,000. Of the total proceeds received, $2,500 was paid to BCAMLP for expenses related to the transfer, which include third party legal costs. The remaining proceeds of approximately $2,500 were returned to cash reserves held by Series 17. The monies held in cash reserves will be utilized to pay current operating expenses, accrued but unpaid asset management fees, and accrued but unpaid expenses of the investment partnership. After all outstanding obligations of the investment partnership are satisfied, any remaining monies will be distributed based on the number of BACs held by each investor at the time of distribution. Annual losses generated by the Operating Partnership, which were applied against the investment limited partnership investment in the Operating Partnership in accordance with the equity method of accounting, had previously reduced the investment limited partnership investment in the Operating Partnership to zero. Accordingly, a gain on the transfer of the Operating Partnership, net of the overhead and expense reimbursement, has been recorded in the amount of $2,500 as of September 30, 2016.
Series 18
As of September 30, 2016 and 2015 the average Qualified Occupancy for the series was 100%. The series had a total of 12 properties at September 30, 2016, all of which were at 100% Qualified Occupancy.
For the six month periods ended September 30, 2016 and 2015, Series 18 reflects a net loss from Operating Partnerships of $(217,315) and $(165,083), respectively, which includes depreciation and amortization of $247,517 and $284,019, respectively. This is an interim period estimate; it is not indicative of the final year end results.
In March 2015, the investment general partner sold its interest in Lakeview Meadows II LDHA LP to a non-affiliated entity for its assumption of the outstanding mortgage balance of approximately $1,437,436 and cash proceeds to the investment partnership of $360,289. Of the total proceeds received by the investment partnership, $50,000 represents reporting fees due to an affiliate of the investment partnership and the balance represents proceeds from the sale. Of the remaining proceeds, $5,000 was paid to BCAMLP for expenses related to the sale, which include third party legal costs. The remaining proceeds of approximately $305,289 were returned to cash reserves held by Series 18. The monies held in cash reserves will be utilized to pay current operating expenses, accrued but unpaid asset management fees, and accrued but unpaid expenses of the investment partnership. After all outstanding obligations of the investment partnership are satisfied, any remaining monies will be distributed based on the number of BACs held by each investor at the time of distribution. Annual losses generated by the Operating Partnership, which were applied against the investment partnership's investment in the Operating Partnership in accordance with the equity method of accounting, had previously reduced the investment in the Operating Partnership to zero. A receivable in the amount of $355,289 was recorded as of March 31, 2015. Sale proceeds in the amount of $341,833 were received in April 2015 and the balance of $13,456 was received in August 2015. Accordingly, a gain on the sale of the Operating Partnership of the proceeds from the sale, net of the overhead and expenses, was recorded in the amount of $305,289 as of March 31, 2015. In August 2015, additional proceeds of $15,294 were received and returned to the cash reserves held by Series 18 resulting in an additional gain on sale.
The investment general partner will continue to monitor the following Operating Partnerships because of operational or other issues. However, these Operating Partnerships have all exited their LIHTC compliance period and there is therefore no risk to past credit delivery.
Humboldt I, Limited Partnership
Marengo Park Apartments, Limited Partnership
Natchitoches Elderly Apartments, A Louisiana Partnership
Vivian Elderly Apartments, A Louisiana Partnership
Series 19
As of September 30, 2016 and 2015 the average Qualified Occupancy for the series was 100%. The series had a total of 6 properties at September 30, 2016, all of which were at 100% Qualified Occupancy.
For the six month periods ended September 30, 2016 and 2015, Series 19 reflects a net loss from Operating Partnerships of $(68,022) and $(64,775), respectively, which includes depreciation and amortization of $82,238 and $72,294, respectively. This is an interim period estimate; it is not indicative of the final year end results.
The investment general partner will continue to monitor the following Operating Partnerships because of operational or other issues. However, these Operating Partnerships have all exited their LIHTC compliance period and there is therefore no risk to past credit delivery.
Carrollton Villa, L.P.
Munford Village, Ltd.
Off Balance Sheet Arrangements
None.
Principal Accounting Policies and Estimates
The condensed financial statements are prepared in accordance with accounting principles generally accepted in the United States of America (GAAP), which require the Fund to make various estimates and assumptions. The following section is a summary of some aspects of those accounting policies that may require subjective or complex judgments and are most important to the portrayal of the Fund's financial condition and results of operations. The Fund believes that there is a low probability that the use of different estimates or assumptions in making these judgments would result in materially different amounts being reported in the financial statements.
The Fund is required to assess potential impairments to its long-lived assets, which are primarily investments in limited partnerships. The Fund accounts for its investment in limited partnerships in accordance with the equity method of accounting since the Fund does not control the operations of the Operating Partnerships. The purpose of an impairment analysis is to verify that the real estate investment balance reflected on the balance sheet does not exceed the value of the underlying investments.
If the book value of the Fund's investment in an Operating Partnership exceeds the estimated value derived by management, which generally consists of the remaining future Low-Income Housing Credits allocable to the Fund and the estimated residual value to the Fund, the Fund reduces its investment in the Operating Partnership.
In accordance with the accounting guidance for the consolidation of variable interest entities, the Fund determines when it should include the assets, liabilities, and activities of a variable interest entity (VIE) in its financial statements, and when it should disclose information about its relationship with a VIE. The analysis that must be performed to determine which entity should consolidate a VIE focuses on control and economic factors. A VIE is a legal structure used to conduct activities or hold assets, which must be consolidated by a company if it is the primary beneficiary because it has (1) the power to direct the activities of the VIE that most significantly impact the VIE's economic performance and (2) the obligation to absorb losses or receive benefits that could potentially be significant to the VIE. If multiple unrelated parties share such power, as defined, no party will be required to consolidate the VIE. Further, the guidance requires continual reconsideration of the primary beneficiary of a VIE.
Based on this guidance, the Operating Partnerships in which the Fund invests meet the definition of a VIE because the owners of the equity at risk in these entities do not have the power to direct their operations. However, management does not consolidate the Fund's interests in these VIEs, as it is not considered to be the primary beneficiary since it does not have the power to direct the activities that are considered most significant to the economic performance of these entities. The Fund currently records the amount of its investment in these partnerships as an asset on its balance sheets, recognizes its share of partnership income or losses in the statements of operations, and discloses how it accounts for material types of these investments in its financial statements. The Fund's balance in investment in Operating Partnerships plus advances made to Operating Partnerships represents its maximum exposure to loss. The Fund's exposure to loss on these partnerships is mitigated by the condition and financial performance of the underlying Housing Complexes as well as the strength of the general partners and their guarantee against credit recapture to the investors of the Fund.
Recent Accounting Pronouncements
In February, 2015, the FASB issued ASU No. 2015-02, "Consolidation (Topic 810): Amendments to the Consolidation Analysis". This will improve certain areas of consolidation guidance for reporting organizations that are required to evaluate whether to consolidate certain legal entities such as limited partnerships, limited liability corporations, and securitization structures. ASU 2015-02 simplifies and improves GAAP by: eliminating the presumption that a general partner should consolidate a limited partnership, eliminating the indefinite deferral of FASB Statement No. 167, thereby reducing the number of Variable Interest Entity (VIE) consolidation models from four to two (including the limited partnership consolidation model), and clarifying when fees paid to a decision maker should be a factor to include in the consolidation of VIEs. ASU 2015-02 will be effective for periods beginning after December 15, 2015. The Fund has determined that there is no material impact to its financial statements as a result of this guidance.
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Item 3. |
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Not Applicable |
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Item 4. |
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(a) |
Evaluation of Disclosure Controls and Procedures |
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As of the end of the period covered by this report, the Fund's general partner, under the supervision and with the participation of the Principal Executive Officer and Principal Financial Officer of C&M Management Inc., carried out an evaluation of the effectiveness of the Fund's "disclosure controls and procedures" as defined under the Securities Exchange Act of 1934 Rules 13a-15 and 15d-15 with respect to each series individually, as well as the Fund as a whole. Based on that evaluation, the Fund's Principal Executive Officer and Principal Financial Officer have concluded that as of the end of the period covered by this report, the Fund's disclosure controls and procedures were effective to ensure that information relating to any series or the Fund as a whole required to be disclosed by it in the reports that it files or submits under the Securities Exchange Act of 1934 (i) is recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms and (ii) is accumulated and communicated to the Fund's management, including the Fund's Principal Executive Officer and Principal Financial Officer, as appropriate, to allow timely decisions regarding required disclosure with respect to each series individually, as well as the Fund as a whole. |
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(b) |
Changes in Internal Controls |
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There were no changes in the Fund's internal control over financial reporting that occurred during the quarter ended September 30, 2016 that materially affected, or are reasonably likely to materially affect, the Fund's internal control over financial reporting. |
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Item 1. |
Legal Proceedings |
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None |
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Item 1A. |
Risk Factors |
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There have been no material changes from the risk factors set forth under Part I, Item 1A. "Risk Factors" in our Form 10-K for the fiscal year ended March 31, 2016. |
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Item 2. |
Unregistered Sales of Equity Securities and Use of Proceeds |
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None |
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Item 3. |
Defaults upon Senior Securities |
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None |
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Item 4. |
Mine Safety Disclosures |
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Not Applicable |
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Item 5. |
Other Information |
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None |
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Item 6. |
Exhibits |
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(a)Exhibits |
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31.a Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, of John P. Manning, Principal Executive Officer, filed herein |
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31.b Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, of Marc N. Teal, Principal Financial Officer, filed herein |
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32.a Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, of John P. Manning, Principal Executive Officer, filed herein |
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32.b Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, of Marc N. Teal, Principal Financial Officer, filed herein
101. The following materials from the Boston Capital Tax Credit Fund III, L.P. Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2016 formatted in Extensible Business Reporting Language (XBRL): (i) the Condensed Balance Sheets, (ii) the Condensed Statements of Operations, (iii) the Condensed Statements of Changes in Partners' Capital (Deficit), (iv) the Condensed Statements of Cash Flows and (v) related notes, filed herein |
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SIGNATURES
Pursuant to the requirements of Section 13 of the Securities Exchange Act of 1934, the Fund has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized.
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Boston Capital Tax Credit Fund III L.P. |
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By: |
Boston Capital Associates III L.P. |
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General Partner |
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By: |
BCA Associates Limited Partnership, |
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General Partner |
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By: |
C&M Management Inc., |
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General Partner |
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Date: November 14, 2016 |
By: |
/s/ John P. Manning |
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John P. Manning |
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Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Fund and in the capacities and on the dates indicated:
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DATE: |
SIGNATURE: |
TITLE: |
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November 14, 2016 |
/s/ John P. Manning |
Director, President |
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John P. Manning |
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DATE: |
SIGNATURE: |
TITLE: |
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November 14, 2016 |
/s/ Marc N. Teal |
Chief Financial Officer |
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Marc N. Teal |