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, 2002
OR
- ------ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
Commission File Number 0-24652
FREEDOM TAX CREDIT PLUS L.P.
(Exact name of registrant as specified in its charter)
Delaware 13-3533987
--------------------------- -----------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
625 Madison Avenue, New York, New York 10022
-------------------------------------- -----------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (212)421-5333
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes X No ____
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
FREEDOM TAX CREDIT PLUS L.P.
AND CONSOLIDATED PARTNERSHIPS
CONSOLIDATED BALANCE SHEETS
============== =============
September 30, March 31,
2002 2002
-------------- -------------
(Unaudited)
ASSETS
Property and equipment - (at cost,
net of accumulated depreciation
of $56,608,050 and $54,178,153,
respectively) $86,067,594 $88,272,567
Cash and cash equivalents 2,166,212 1,833,843
Investment in marketable securities 80,918 109,005
Cash held in escrow 4,956,103 4,671,259
Deferred costs (net of accumulated
amortization of $1,749,005
and $1,655,647, respectively) 1,192,934 1,286,292
Other assets 1,191,279 1,002,139
----------- -----------
Total Assets $95,655,040 $97,175,105
=========== ===========
2
FREEDOM TAX CREDIT PLUS L.P.
AND CONSOLIDATED PARTNERSHIPS
CONSOLIDATED BALANCE SHEETS
(continued)
============== =============
September 30, March 31,
2002 2002
-------------- -------------
(Unaudited)
LIABILITIES AND PARTNERS' CAPITAL (DEFICIT)
Liabilities:
Mortgage notes payable $67,638,688 $68,063,227
Accounts payable and other
liabilities 2,392,164 1,649,957
Due to local general partners and
affiliates 3,558,323 3,819,933
Due to general partners and
affiliates (Note 2) 6,503,386 6,020,763
----------- -----------
Total Liabilities 80,092,561 79,553,880
----------- -----------
Minority interests 7,984,445 8,015,243
----------- -----------
Partners' Capital (Deficit):
Limited partners (72,896 BACs
issued and outstanding) 8,206,603 10,186,465
General partners (604,627) (584,628)
Accumulated other comprehensive
income:
Unrealized (gain) loss on marketable
securities (23,942) 4,145
----------- -----------
Total Partners' Capital (Deficit) 7,578,034 9,605,982
----------- -----------
Total Liabilities and Partners'
Capital (Deficit) $95,655,040 $97,175,105
=========== ===========
The accompanying notes are an integral part of these consolidated condensed
financial statements.
3
FREEDOM TAX CREDIT PLUS L.P.
AND CONSOLIDATED PARTNERSHIPS
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
======================= ========================
Three Months Ended Six Months Ended
September 30, September 30,
----------------------- ------------------------
2002 2001 2002 2001
----------------------- ------------------------
Revenues
Rental income $3,561,670 $3,403,347 $ 7,072,331 $ 6,779,237
Other 387,619 397,048 678,132 736,665
---------- ---------- ----------- -----------
Total revenues 3,949,289 3,800,395 7,750,463 7,515,902
---------- ---------- ----------- -----------
Expenses
General and
administrative 671,036 642,837 1,384,382 1,385,566
General and
administrative-
related parties
(Note 2) 407,916 363,663 836,055 730,096
Operating and
other 382,072 363,972 739,843 764,951
Repairs and
maintenance 657,321 496,106 1,229,664 998,390
Real estate taxes 240,264 248,857 491,436 500,343
Insurance 132,743 114,387 257,947 220,223
Financial 1,165,618 1,196,755 2,307,775 2,351,229
Depreciation and
amortization 1,258,181 1,285,674 2,523,255 2,571,197
---------- ---------- ----------- -----------
Total expenses 4,915,151 4,712,251 9,770,357 9,521,995
---------- ---------- ----------- -----------
Loss before
minority interest (965,862) (911,856) (2,019,894) (2,006,093)
Minority interest
in loss of
subsidiary
partnerships 9,219 9,223 20,033 21,312
---------- ---------- ----------- -----------
Net loss $ (956,643) $ (902,633) $(1,999,861) $(1,984,781)
========== ========== =========== ===========
Net loss - limited
partners $ (947,076) $ (893,606) $(1,979,862) $(1,964,933)
========== ========== =========== ===========
Number of BACs
outstanding 72,896 72,896 72,896 72,896
========== ========== =========== ===========
Net loss per BAC $ (12.99) $ (12.26) $ (27.16) $ (26.96)
========== ========== =========== ===========
The accompanying notes are an integral part of these consolidated condensed
financial statements.
4
FREEDOM TAX CREDIT PLUS L.P.
AND CONSOLIDATED PARTNERSHIPS
CONSOLIDATED STATEMENT OF CHANGES IN PARTNERS' CAPITAL (DEFICIT)
(Unaudited)
Accumulated
Other
Limited General Comprehensive Comprehensive
Total Partners Partners Income (loss) Loss
----------- ----------- ----------- ------------- -------------
Partners' capital (deficit) April 1, 2002 $ 9,605,982 $10,186,465 $ (584,628) $ 4,145
Comprehensive Loss:
Net loss - Six months ended
September 30, 2002 (1,999,861) (1,979,862) (19,999) $(1,999,861)
Net unrealized loss on marketable
securities (28,087) 0 0 (28,087) (28,087)
----------- ----------- ----------- ----------- -----------
Total Comprehensive Loss $(2,027,948)
===========
Partners' capital (deficit)
September 30, 2002 $ 7,578,034 $ 8,206,603 $ (604,627) $ (23,942)
=========== =========== =========== ===========
The accompanying notes are an integral part of these consolidated condensed
financial statements.
5
FREEDOM TAX CREDIT PLUS L.P.
AND CONSOLIDATED PARTNERSHIPS
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
=============================
Six Months Ended
September 30,
-----------------------------
2002 2001
-----------------------------
Cash flows from operating activities:
Net loss $(1,999,861) $(1,984,781)
Adjustments to reconcile net loss
to net cash provided by
operating activities:
Depreciation and amortization 2,523,255 2,571,197
Minority interest in loss of
subsidiaries (20,033) (21,312)
Increase in cash held
in escrow (284,844) (255,459)
Increase in other assets (189,140) (123,194)
Increase in accounts payable
and other liabilities 742,207 566,734
Increase in due to general partners
and affiliates 482,623 474,769
Increase in due to local general
partners and affiliates 58,917 55,017
Decrease in due to local general
partners and affiliates (320,527) (168,770)
----------- -----------
Net cash provided by
operating activities 992,597 1,114,201
----------- -----------
Cash flows from investing activities:
Acquisition of property and
equipment (224,924) (422,130)
----------- -----------
Net cash used in investing
activities (224,924) (422,130)
----------- -----------
6
FREEDOM TAX CREDIT PLUS L.P.
AND CONSOLIDATED PARTNERSHIPS
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(continued)
=============================
Six Months Ended
September 30,
-----------------------------
2002 2001
-----------------------------
Cash flows from financing activities:
Repayments of mortgage notes (424,539) (405,712)
Decrease in capitalization of
consolidated subsidiaries and
distributions attributable to
minority interest (10,765) (20,297)
----------- -----------
Net cash used in financing
activities (435,304) (426,009)
----------- -----------
Net increase in cash and cash
equivalents 332,369 266,062
Cash and cash equivalents at
beginning of period 1,833,843 1,671,096
----------- -----------
Cash and cash equivalents at
end of period $ 2,166,212 $ 1,937,158
=========== ===========
Supplemental disclosure of cash
flow information:
Cash paid during period for interest $ 2,079,207 $ 2,159,373
=========== ===========
The accompanying notes are an integral part of these consolidated condensed
financial statements.
7
FREEDOM TAX CREDIT PLUS L.P.
AND CONSOLIDATED PARTNERSHIPS
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 2002
(Unaudited)
Note 1 - General
The consolidated financial statements include the accounts of Freedom Tax Credit
Plus L.P. ("the Partnership") and 42 subsidiary partnerships ("subsidiaries",
"subsidiary partnerships" or "Local Partnerships") in which the Partnership is a
Limited Partner. Through the rights of the Partnership and/or an affiliate of a
General Partner, which affiliate has a contractual obligation to act on behalf
of the Partnership, to remove the general partner of the Local Partnerships and
to approve certain major operating and financial decisions, the Partnership has
a controlling financial interest in the Local Partnerships.
The Partnership's fiscal quarter ends September 30. All subsidiaries have fiscal
quarters ending June 30 in order to allow adequate time for the subsidiaries'
financial statements to be prepared and consolidated. Accounts of the
subsidiaries have been adjusted for intercompany transactions from July 1
through September 30.
All intercompany accounts and transactions have been eliminated in
consolidation.
Increases (decreases) in the capitalization of consolidated subsidiaries
attributable to minority interest arise from cash contributions from and cash
distributions to the minority interest partners.
Losses attributable to minority interests aggregated approximately $9,000,
$9,000, $20,000 and $21,000 for the three and six months ended September 30,
2002 and 2001, respectively. The Partnership's investment in each subsidiary is
generally equal to the respective subsidiary's partners' equity less minority
interest capital, if any.
The books and records of the Partnership are maintained on the accrual basis of
accounting in accordance with accounting principles generally accepted in the
United States of America. In the opinion of the General Partners of the
Partnership, the accompanying unaudited financial statements contain all
adjustments (consisting only of normal recurring adjustments) necessary to
present fairly the financial position of the Partnership as of September 30,
2002, the results of operations for the three and six months ended September 30,
2002 and 2001 and cash flows for the six months ended September 30, 2002 and
2001. However, the operating results and cash flows for the six months ended
September 30, 2002 may not be indicative of the results for the year.
8
FREEDOM TAX CREDIT PLUS L.P.
AND CONSOLIDATED PARTNERSHIPS
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 2002
(Unaudited)
Certain information and note disclosures normally included in financial
statements prepared in accordance with accounting principles generally accepted
in the United States of America have been omitted or condensed. These condensed
financial statements should be read in conjunction with the financial statements
and notes thereto included in the Partnership's Annual Report on Form 10-K for
the year ended March 31, 2002.
Note 2 - Related Party Transactions
The costs incurred to related parties for the three and six months ended
September 30, 2002 and 2001 were as follows:
Three Months Ended Six Months Ended
September 30, September 30,
--------------------- ---------------------
2002 2001 2002 2001
--------------------- ---------------------
Partnership manage-
ment fees (a) $169,000 $169,000 $338,000 $338,000
Expense reimburse-
ment (b) 34,464 19,679 87,330 45,929
Local administra-
tive fee (c) 14,000 14,000 27,000 27,000
-------- -------- -------- --------
Total general and
administrative-
General Partners 217,464 202,679 452,330 410,929
-------- -------- -------- --------
Property manage-
ment fees
incurred to
affiliates of
the subsidiary
partnerships'
general
partners (d) 190,452 160,984 383,725 319,167
-------- -------- -------- --------
Total general and
administrative-
related parties $407,916 $363,663 $836,055 $730,096
======== ======== ======== ========
9
FREEDOM TAX CREDIT PLUS L.P.
AND CONSOLIDATED PARTNERSHIPS
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 2002
(Unaudited)
(a) The General Partners are entitled to receive a partnership management fee,
after payment of all Partnership expenses, which together with the annual local
administrative fees, will not exceed a maximum of 0.5% per annum of invested
assets (as defined in the Partnership Agreement), for administering the affairs
of the Partnership. Subject to the foregoing limitation, the partnership
management fee will be determined by the General Partners in their sole
discretion based upon their review of the Partnership's investments. Unpaid
partnership management fees for any year will be accrued without interest and
will be payable from working capital reserves or to the extent of available
funds after the Partnership has made distributions to the Limited Partners and
BACs holders of sale or refinancing proceeds equal to their original capital
contributions plus a 10% priority return thereon (to the extent not theretofore
paid out of cash flow). Partnership management fees owed to the General Partners
amounting to approximately $5,194,000 and $4,856,000 were accrued and unpaid as
of September 30, 2002 and March 31, 2002, respectively. Without the General
Partners' continued accrual without payment, the Partnership will not be in a
position to meet its obligations. The General Partners have continued allowing
the accrual without payment of these amounts, but are under no obligation to
continue to do so. The Partnership is dependent upon the support of the General
Partners and certain of their affiliates in order to meet its obligations at the
Partnership level. The General Partners and these affiliates have agreed to
continue such support for the foreseeable future.
(b) The Partnership reimburses the General Partners and their affiliates for
actual Partnership operating expenses incurred by the General Partners and their
affiliates on the Partnership's behalf. The amount of reimbursement from the
Partnership is limited by the provisions of the Partnership Agreement. Another
affiliate of the General Partners performs asset monitoring for the Partnership.
These services include site visits and evaluations of the subsidiary
partnerships' performance.
(c) Freedom SLP L.P., a special limited partner of the subsidiary partnerships,
is entitled to receive an annual local administrative fee of up to $2,500 per
year from each subsidiary partnership.
(d) Property management fees incurred by subsidiary partnerships amounted to
$253,677, $248,853, $510,819 and $497,327 for the three and six months ended
September 30, 2002 and 2001, respectively. Of these fees, $190,452, $160,984,
10
FREEDOM TAX CREDIT PLUS L.P.
AND CONSOLIDATED PARTNERSHIPS
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 2002
(Unaudited)
$383,725 and $319,167, respectively, were incurred to affiliates of the
subsidiary partnerships' general partners for the three and six months ended
September 30, 2002 and 2001, respectively.
11
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations
Liquidity and Capital Resources
- -------------------------------
During the quarter ended September 30, 2002, net cash flow from property
operations, working capital and interest earned on working capital represents
the primary source of liquidity to fund distributions, debt service, capital
improvements and non-revenue enhancing tenant improvements. The net cash flow
from property operations is dependent upon the occupancy level of the properties
owned by the Local Partnerships, the collectibility of rent from tenants, the
level of operating and other expenses, and other factors. Material changes in
these factors may adversely affect the net cash flow from property operations.
Such changes, in turn, would adversely affect the Local Partnerships' ability to
fund distributions, debt service, capital improvements and non-revenue enhancing
tenant improvements. In addition, a material adverse change in the net cash flow
from operations may affect the financial performance covenants under the
mortgage notes within each Local Partnership. If the Local Partnerships fail to
meet any of these financial performance covenants, these properties' mortgage
notes may become due and in default, or the interest charged on refinancing the
notes may increase. Either of these circumstances could adversely affect the
Local Partnerships' ability to fund working capital and revenue enhancing tenant
improvements, and unanticipated cash needs.
As of September 30, 2002, there was approximately $20,000 in working capital
reserves available to fund Partnership level expenses, including Partnership
management fees payable to the General Partners and advances to Local
Partnerships if warranted. The Partnership is dependent upon the support of the
General Partners and certain of its affiliates in order to meet its obligations
at the Partnership level. The General Partners and these affiliates have agreed
to continue such support for the foreseeable future.
Cash distributions from Local Partnerships are not expected to reach a level
sufficient to permit cash distributions to BACs holders. These distributions as
well as the working capital reserves referred to in the preceding paragraph and
the continued deferral by the General Partners of fees owed to them will be used
to meet the operating expenses of the Partnership.
During the six months ended September 30, 2002, cash and cash equivalents of the
Partnership and its forty-two consolidated Local Partnerships increased
approximately $332,000 due to cash provided by operating activities ($993,000)
which exceeded acquisitions of property and equipment ($225,000), a decrease in
capitalization of consolidated subsidiaries attributable to minority interest
($11,000) and repayments of mortgage notes ($425,000). Included in the
adjustments to reconcile the net loss to cash provided by operating activities
is depreciation and amortization of approximately $2,523,000.
12
The Partnership's most critical accounting policy relates to the evaluation of
the fair value of real estate. Each Local Partnership evaluates the need for an
impairment loss on its real estate assets when indicators of impairment are
present and the undiscounted cash flows are not sufficient to recover the
asset's carrying amount. The impairment loss is measured by comparing the fair
value of the asset to its carrying amount. In addition, estimates are used when
accounting for the allowance for doubtful accounts and contingent liabilities,
among others. These estimates are susceptible to change and actual results could
differ from these estimates. The affects of changes in these estimates are
recognized in the period they are determined.
Commitments and Contingencies
- -----------------------------
The Partnership is subject to risks incidental to potential losses arising from
the management and ownership of improved real estate by the Local Partnerships
in which it invests. The Partnership can also be affected by poor economic
conditions. However, no more than 24% of the properties are located in any
single state. There are also substantial risks associated with owning properties
receiving government assistance; for example, the possibility that Congress may
not appropriate funds to enable HUD to make rental assistance payments. HUD also
restricts annual cash distributions to partners based on operating results and a
percentage of the owners' equity contribution. The Partnership cannot sell or
substantially liquidate its investments in Local Partnerships during the period
that the subsidy agreements are in existence, without HUD's approval.
Furthermore, there may not be market demand for apartments at full market rents
when the rental assistance contract expires.
Except as described above, management is not aware of any trends or events,
commitments or uncertainties, which have not otherwise been disclosed, that will
or are likely to impact liquidity in a material way. Management believes the
only impact would be from laws that have not yet been adopted. The portfolio is
diversified by the location of the properties around the United States so that
if one area of the country is experiencing downturns in the economy, the
remaining properties in the portfolio may not be affected. However, the
geographic diversification of the portfolio may not protect against a general
downturn in the national economy.
13
The Partnership's loss of its investment in a Local Partnership would eliminate
the ability to generate future Housing Tax Credits from such Local Partnership
and may also result in recapture of Housing Tax Credits if the investment is
lost before the expiration of the Credit Period.
The Partnership has fully invested the proceeds of its offering in 42 Local
Partnerships, all of which have their Housing Tax Credits in place. The Housing
Tax Credits, which expire in the years ended December 31, 2002 and 2003, are
attached to the property for a period of ten years and are transferable with the
property during the remainder of the ten year period. If trends in the real
estate market warranted the sale of a property, the remaining Housing Tax
Credits would transfer to the new owner, thereby adding significant value to the
property on the market.
Related Party Transactions and Transactions with General Partners and Affiliates
- --------------------------------------------------------------------------------
The Local General Partners may from time to time advance the Local Partnerships
money to fund certain property costs. These advances are to be repaid to the
Local General Partners without interest from available surplus cash of the
respective Local Partnership, or at the time of sale or refinancing. Unpaid
balance amounted to $3,558,323 and $3,819,933 at September 30, 2002 and March
31, 2002, respectively, and is recorded as due to Local General Partners and
affiliates on the consolidated balance sheets.
Certain costs are also incurred by the Partnership that are payable to
affiliates. The General Partners are entitled to receive a partnership
management fee, after payment of all Partnership expenses, which together with
the annual local administrative fees will not exceed a maximum of 0.5% per annum
of Invested Assets (as defined in the Partnership Agreement), for administering
the affairs of the Partnership. Subject to the foregoing limitation, the
partnership management fee will be determined by the General Partners in their
sole discretion based upon their review of the Partnership's investment.
Partnership management fee amounted to $338,000 for each of the six months ended
September 30, 2002 and 2001. Unpaid partnership management fees for any year
will be accrued without interest and will be payable from working capital
reserves or to the extent of available funds after the Partnership has made
distributions to the Limited Partners and BACs holders of sale or refinancing
proceeds equal to their original capital contributions plus a 10% priority
return thereon (to the extent not theretofore paid out of cash flow).
Partnership management fees owed to General Partners amounting to approximately
$5,194,000 and $4,856,000 were accrued and unpaid as of September 30, 2002 and
March 31, 2002, respectively. Without the General Partners' continued accrual
without payment, the Partnership will not be in a position to meet its
obligations. The General Partners have continued allowing the accrual without
payment of these amounts, but are under no obligation to continue to do so. The
Partnership is dependent upon the support of the General Partner and certain of
its affiliates in order to meet its obligations at the Partnership level. The
General Partner and these affiliates have agreed to continue such support for
the foreseeable future.
14
Furthermore, the Partnership reimburses the General Partners and their
affiliates for actual Partnership operating expenses incurred by the General
Partners and their affiliates on the Partnership's behalf. The amount of
reimbursement from the Partnership is limited by the provision of the
Partnership Agreement and could fluctuate from year to year depending upon the
level of activities and transactions for the year. Services performed by these
affiliates include monitoring of partnership assets, site visits and evaluations
of Local Partnership performance. Reimbursements amounted to approximately
$87,000 and $119,000 for the six months ended September 30, 2002 and the year
ended March 31, 2002, respectively.
Results of Operations
- ---------------------
The results of operations for the three and six months ended September 30, 2002
continued to be in the form of rental income with corresponding expenses divided
among operations, depreciation and mortgage interest.
Rental income remained fairly consistent with increases of approximately 5% and
4% for the three and six months ended September 30, 2002 as compared to the
corresponding periods in 2001, primarily due to rental rate increases.
General and administrative-related parties expenses increased approximately
$44,000 and $106,000 for the three and six months ended September 30, 2002 as
compared to the corresponding periods in 2001, primarily due to an increase in
expenses reimbursements due to the General Partner for asset monitoring and
overhead and an increase in property management fees incurred to affiliates of
the Local Partnership's general partners.
15
Repairs and maintenance expenses increased approximately $161,000 and $231,000
for the three and six months ended September 30, 2002 as compared to the
corresponding periods in 2001, primarily due to insurance reimbursements for
fire damages at one Local Partnership in 2001 and an increase in ground
maintenance at two other Local Partnerships in 2002.
Insurance expenses increased approximately $18,000 and $38,000 for the three and
six months ended September 30, 2002 as compared to the corresponding periods in
2001, primarily due to an increase in insurance premiums at the Local
Partnerships.
Item 3. Quantitative and Qualitative Disclosures about Market Risk.
The Partnership is not exposed to market risk since its mortgage indebtedness
bears fixed rates of interest.
Item 4 Controls and Procedures
The Principal Executive Officer and Principal Financial Officer of Related
Freedom Associates L.P. and Freedom GP Inc., each of which is a general partner
of Freedom Tax Credit Plus L.P. (the "Partnership"), has evaluated the
Partnership's disclosure controls and procedures relating to the Partnership's
quarterly report on Form 10-Q for the period ending September 30, 2002 as filed
with the Securities and Exchange Commission and has judged such controls and
procedures to be effective as of September 30, 2002 (the "Evaluation Date").
There have been no significant changes in the internal controls or in other
factors that could significantly affect internal controls relating to the
Partnership since the Evaluation Date.
16
PART II. OTHER INFORMATION
Item 1. Legal Proceedings - None
Item 2. Changes in Securities and Use of Proceeds - None
Item 3. Defaults Upon Senior Securities - None
Item 4. Submission of Matters to a Vote of Security Holders - None
Item 5. Other Information - None
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
99.1 Certification Pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
(b) Reports on Form 8-K
Current report on Form 8-K/A dated August 28, 2002, was filed on
September 3, 2002, relating to the change in Partnership's accountant.
17
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.
FREEDOM TAX CREDIT PLUS L.P.
(Registrant)
By: RELATED FREEDOM ASSOCIATES L.P.,
a General Partner
By: RELATED FREEDOM ASSOCIATES INC.,
General Partner
Date: November 5, 2002
By:/s/ Alan P. Hirmes
------------------
Alan P. Hirmes, President
(Principal Executive and
Financial Officer)
Date: November 5, 2002
By:/s/ Glenn F. Hopps
------------------
Glenn F. Hopps, Treasurer
(Principal Accounting Officer)
and
By: FREEDOM GP INC.,
a General Partner
Date: November 5, 2002
By:/s/ Alan P. Hirmes
------------------
Alan P. Hirmes, President
(Principal Executive and
Financial Officer)
Date: November 5, 2002
By:/s/ Glenn F. Hopps
------------------
Glenn F. Hopps, Treasurer
(Principal Accounting Officer)
CERTIFICATION
I, Alan P. Hirmes, Principal Executive Officer and Principal Financial Officer
of Related Freedom Associates L.P. and Freedom GP Inc. (the "General Partners"),
each of which is a general partner of Freedom Tax Credit Plus L.P. (the
"Partnership"), hereby certify that:
1. I have reviewed this quarterly report on Form 10-Q for the period
ended September 30, 2002 of the Partnership;
2. Based on my knowledge, this quarterly report does not contain any
untrue statement of a material fact or omit stating a material fact
necessary in order to make the statements made, in light of the
circumstances under which such statements were made, not misleading
with respect to the period covered by this quarterly report;
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present, in all
material respects the financial condition, results of operations and
cash flows of the Partnership as of, and for, the periods presented in
this quarterly report;
4. I am responsible for establishing and maintaining disclosure controls
and procedures (as defined in Exchange Act Rules 13a-14 and 15-d-14)
for the Partnership and I have:
a) designed such disclosure controls and procedures to ensure that the
material information relating to the Partnership is made known to me,
particularly during the period in which this quarterly report was
being prepared;
b) evaluated the effectiveness of the Partnership's disclosure
controls and procedures as of September 30, 2002 (the "Evaluation
Date"); and
c) presented in this quarterly report my conclusions about the
effectiveness of the disclosure controls and procedures based on our
evaluation as of the Evaluation Date;
5. I have disclosed, based on my most recent evaluation, to the
Partnership's auditors and to the boards of directors of the General
Partners:
a) all significant deficiencies in the design or operation of internal
controls which could adversely affect the Partnership's ability to
record, process, summarize and report financial data and have
identified for the Partnership's auditors any material weaknesses in
internal controls; and
b) any fraud, whether or not material, that involves management or
other employees who have a significant role in the Partnership's
internal controls; and
6. I have indicated in this quarterly report whether or not there were
significant changes in internal controls or in other factors that
could significantly affect internal controls subsequent to the date of
our most recent evaluation, including any corrective actions with
regard to significant deficiencies and material weaknesses.
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Partnership has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
By: /s/ Alan P. Hirmes
-------------------
Alan P. Hirmes
Principal Executive Officer and
Principal Financial Officer
November 5, 2002
Exhibit 99.1
CERTIFICATION PURSUANT TO
18.U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report of Freedom Tax Credit Plus L.P. (the
"Partnership") on Form 10-Q for the period ending September 30, 2002 as filed
with the Securities and Exchange Commission on the date hereof (the "Report"),
I, Alan P. Hirmes, Principal Executive Officer and Principal Financial Officer
of Related Freedom Associates L.P. and Freedom GP Inc., each of which is the
general partner of the Partnership, certify, pursuant to 18 U.S.C. Section 1350,
as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:
(1) The Report fully complies with the requirements of section 13(a) or
15(d) of the Securities Exchange Act of 1934; and
(2) The information contained in the Report fairly presents, in all
material respects, the financial condition and result of operations of the
Partnership.
By: /s/ Alan P. Hirmes
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Alan P. Hirmes
Principal Executive Officer and Principal Financial Officer
November 5, 2002