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FORM 10-Q

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

(Mark One)

(X)   QUARTERLY REPORT PERSUANT TO SECTION 13 OR 15 (D) OF THE SECURITIES EXCHANGE ACT OF 1934.

      For the quarterly period ended June 30, 2002

                                             or

( )   TRANSITION REPORT PERSUANT 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)

Registrants telephone number, including area code (617)624-8900

(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 preceeding 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

_

 

 

 

 

BOSTON CAPITAL TAX CREDIT FUND III L.P.

QUARTERLY REPORT ON FORM 10-Q
FOR THE QUARTER ENDED JUNE 30,2002

TABLE OF CONTENTS

FOR THE QUARTER ENDED June 30,2002

Balance_Sheets *

Balance_Sheets_Series_15 *

Balance_Sheets_Series_16 *

Balance_Sheets_Series_17 *

Balance_Sheets_Series_18 *

Balance_Sheets_Series_19 *

Statements_of_Operations *

THREE MONTHS ENDED JUNE 30 *

Statements_of_Operations_Series_15 *

Statements_of_Operations_Series_16 *

Statements_of_Operations_Series_17 *

Statements_of_Operations_Series_18 *

Statements_of_Operations_Series_19 *

Changes_in_Partners_Capital 16

Changes_in_Partners_Capital_Series_15 17

Changes_in_Partners_Capital_Series_16 17

Changes_in_Partners_Capital_Series_17 18

Changes_in_Partners_Capital_Series_18 18

Changes_in_Partners_Capital_Series_19 19

Statements_of_Cash_Flows 20

tHREE MONTHS ENDED JUNE 30

Statements_of_Cash_Flows_Series_15 22

Statements_of_Cash_Flows_Series_16 24

Statements_of_Cash_Flows_Series_17 26

Statements_of_Cash_Flows_Series_18 28

Statements_of_Cash_Flows_Series_19 30

Notes_to_Financial_Statements *

Note_A_Organization *

Note_B_Accounting *

Investment *

Cost

Note_C_Related_Party_Transactions 34

Note_D_Investments 35

Combined_Statements_of_Operations 36

Combined_Statements_Series_15 36

Combined_Statements_Series_16 37

Combined_Statements_Series_17 38

Combined_Statements_Series_18 39

Combined_Statements_Series_19 40

Liquidity 42

Capital_Resources 42

Results_of_Operations 43

Part_II_Other_Information 49

SIGNATURES 50

 

 

 

 

 

Boston Capital Tax Credit Fund III L.P.

BALANCE SHEETS

 

 

June 30,

2002

(Unaudited)

March 31,

2002

(Audited)

ASSETS

INVESTMENTS IN OPERATING
   PARTNERSHIPS(Note D)

$ 72,824,096

$ 75,098,878
     

OTHER ASSETS

    

Cash and cash equivalents

2,064,295

2,273,043

Investments

-

-

Notes receivable

1,309,982

1,309,982

Deferred acquisition costs, 

   net of accumulated amortization

  (Note B)

 

1,388,335

 

1,405,559

Other assets

  2,971,602

  2,971,523
 

$ 80,558,310

$ 83,058,985
     

LIABILITIES

    
     

Accounts payable & accrued expenses 
(Note C)

$      4,553

$      4,553

Accounts payable affiliates

17,039,529

    16,790,272

Capital contributions payable

  1,313,890

  1,384,034
 

 18,357,972

 18,178,859
     

PARTNERS CAPITAL

    
     

Limited Partners 
  
   Units of limited partnership 
   interest, $10 stated value per BAC; 
   22,000,000 authorized BACs; 
   21,996,102 issued and outstanding, 
   as of June 30, 2002   







63,467,998







66,120,988

General Partner

(1,267,660)

(1,240,862)
 

 62,200,338

 64,880,126
 

$ 80,558,310

$ 83,058,985

 

 

 

 

The accompanying notes are an integral part of this statement

 

 

 

Boston Capital Tax Credit Fund III L.P.

BALANCE SHEETS

Series 15

 

 

June 30,

2002

(Unaudited)

March 31,

2002

(Audited)

ASSETS

 

 

 

INVESTMENTS IN OPERATING
   PARTNERSHIPS(Note D)

$ 9,118,097

$ 9,478,582
     

OTHER ASSETS

    
     

Cash and cash equivalents

372,362

444,415

Investments

-

   -

Notes receivable

-

-

Deferred acquisition costs, 
   net of accumulated amortization
  (Note B)

 

212,860

 

215,488

Other assets

   793,901

   793,901
 

$10,497,220

$10,932,386
     

LIABILITIES

    
     

Accounts payable & accrued expenses 
  (Note C)

$     1,145

$     1,145

Accounts payable affiliates

4,703,529

4,666,517

Capital contributions payable

    16,206

    16,206
 

 4,720,880

 4,683,868
     

PARTNERS CAPITAL

    
     

Limited Partners 
  
   Units of limited partnership 
   interest, $10 stated value per
   BAC; 22,000,000 authorized BACs;
   3,870,500 issued and outstanding,
   as of June 30, 2002   







6,051,248







6,518,704


General Partner

 (274,908)

 (270,186)
 

 5,776,340

 6,248,518
 

$10,497,220

$10,932,386



The accompanying notes are an integral part of this statement

 

 

 

Boston Capital Tax Credit Fund III L.P.

BALANCE SHEETS

Series 16



June 30,

2002

(Unaudited)

March 31,

2002

(Audited)

ASSETS

  

 

INVESTMENTS IN OPERATING
   PARTNERSHIPS (Note D)

$16,882,137

$17,545,233

 

    

OTHER ASSETS

    
     

Cash and cash equivalents

388,555

489,893

Investments

-

-

Notes receivable

-

-

Deferred acquisition costs, 
   net of accumulated amortization 
  (Note B)

 

341,258

 

345,471

Other assets

   119,178

   119,178
 

$17,731,128

$18,499,775
     

LIABILITIES

    
     

Accounts payable & accrued expenses 
  (Note C)

$         -

$         -

Accounts payable affiliates

3,875,998

3,803,006

Capital contributions payable

    78,362

   138,506
 

 3,954,360

 3,941,512
     

PARTNERS CAPITAL

    
     

Limited Partners 
  
   Units of limited partnership    
   interest, $10 stated value per
   BAC; 22,000,000 authorized BACs;
   5,429,402 issued and outstanding,
   as of June 30, 2002







14,105,610







14,879,290

General Partner

 (328,842)

 (321,027)

 

13,776,768

14,558,263
 

$17,731,128

$18,499,775


The accompanying notes are an integral part of this statement

 

Boston Capital Tax Credit Fund III L.P.

BALANCE SHEETS

Series 17



June 30,

2002

(Unaudited)

March 31,

2002

(Audited)

ASSETS

  

 

INVESTMENTS IN OPERATING 
   PARTNERSHIPS (Note D)

$16,544,683

$16,878,320

 

    

OTHER ASSETS

    
     

Cash and cash equivalents

495,953

491,940

Investments

-

-

Notes receivable

1,309,982

1,309,982

Deferred acquisition costs, 
   net of accumulated amortization
  (Note B)

 

307,111

 

310,998

Other assets

 1,963,567

 1,964,133
 

$20,621,296

$20,955,373
     

LIABILITIES

    
     

Accounts payable & accrued expenses 
  (Note C)

$         -

$         -

Accounts payable affiliates

5,315,220

5,174,295

Capital contributions payable

1,176,768

 1,186,768
 

6,491,988

 6,361,063
     

PARTNERS CAPITAL

    
     

Limited Partners 
  
   Units of limited partnership    
   interest, $10 stated value per
   BAC; 22,000,000 authorized BACs;
   5,000,000 issued and outstanding,
   as of June 30, 2002   







14,417,695







14,878,047


General Partner

 (288,387)

 (283,737)
 

14,129,308

14,594,310
 

$20,621,296

$20,955,373


The accompanying notes are an integral part of this statement

 

 

 

Boston Capital Tax Credit Fund III L.P.

BALANCE SHEETS

Series 18



June 30,

2002

(Unaudited)

March 31,

2002

(Audited)

ASSETS

  

 

INVESTMENTS IN OPERATING   

   PARTNERSHIPS (NOTE D)

$12,097,969

$12,586,199
     

OTHER ASSETS

    
     

Cash and cash equivalents

371,742

365,987

Investments

-

-

Notes receivable

-

-

Deferred acquisition costs,  

   Net of accumulated amortization

  (Note B)

 

232,064

 

234,917

Other assets

    89,184

    89,184
 

$12,790,959

$13,276,287
     

LIABILITIES

    
     

Accounts payable & accrued expenses 

  (Note C)


$         -

$         -

Accounts payable affiliates

2,296,322

2,200,833

Capital contributions payable

    18,554

    18,554
 

 2,314,876

 2,219,387
     

PARTNERS CAPITAL

    
     

Limited Partners 
  
   Units of limited partnership    
   interest, $10 stated value per
   BAC; 22,000,000 authorized BACs;
   3,616,200 issued and outstanding,
   as of June 30, 2002       







10,681,550







11,256,559


General Partner

 (205,467)

 (199,659)
 

10,476,083

11,056,900
 

$12,790,959

$13,276,287



The accompanying notes are an integral part of this statement

 

 

 

Boston Capital Tax Credit Fund III L.P.

BALANCE SHEETS

Series 19



June 30,

2002

(Unaudited)

March 31,

2002

(Audited)

ASSETS

  

 

INVESTMENTS IN OPERATING
   PARTNERSHIPS (NOTE D)    

$18,181,210

$18,610,544
     

OTHER ASSETS

    
     

Cash and cash equivalents

435,683

480,808

Investments

-

-

Notes receivable

-

-

Deferred acquisition costs, 
   net of accumulated amortization
   (Note B)

 

295,042

 

298,685

Other assets

     5,772

     5,127
 

$18,917,707

$19,395,164
     

LIABILITIES

    
     

Accounts payable & accrued expenses
   (Note C)

$     3,408

$     3,408

Accounts payable affiliates

848,460

945,621

Capital contributions payable

    24,000

    24,000
 

  875,868

   973,029
     

PARTNERS CAPITAL

    
     

Limited Partners 
  
   Units of limited partnership    
   interest, $10 stated value per
   BAC; 22,000,000 authorized BACs;
   4,080,000 issued and outstanding,
   as of June 30, 2002    







18,211,895







18,588,388


General Partner

 (170,056)

 (166,253)
 

18,041,839

18,422,135
 

$18,917,707

$19,395,164

The accompanying notes are an integral part of this statement

 

Boston Capital Tax Credit Fund III L.P.

STATEMENTS OF OPERATIONS


Three Months Ended June 30,
(Unaudited)

 


2002


2001
     

Income

    

  Interest income

$     6,817

$     28,524

  Other income

      6,177

     16
 

     12,994

     28,540

Share of loss from Operating 
  Partnerships(Note D)

(2,120,766)

(2,356,628)
     

Expenses

    

  Professional fees

43,961

73,407

  Fund management fee (Note C) 

487,661

548,490

  Amortization

17,224

17,225

  General and administrative expenses

     23,170

     21,574

  

  572,016

    660,696
     

  NET LOSS

$(2,679,788)

$(2,988,784)
     

Net loss allocated to limited partners

$(2,652,990)

$(2,958,896)
     

Net loss allocated to general partner

$   (26,798)

$   (29,888)
     

Net loss per BAC

$      (.61)

$      (.68)
     















The accompanying notes are an integral part of this statement

Boston Capital Tax Credit Fund III L.P.

STATEMENTS OF OPERATIONS

Three Months Ended June 30,
(Unaudited)

Series 15


2002


2001
     

Income

    

  Interest income

$     1,386

$     5,727

  Other income

     1,033

     16

     2,419

     5,743

Share of loss from Operating 
  Partnerships(Note D)

 (357,374)

 (310,584)
     

Expenses

    

  Professional fees

11,195

9,690

  Fund management fee    

99,030

119,368

  Amortization

2,628

2,628

  General and administrative expenses

     4,370

     3,891

  

  117,223

   135,577
     

  NET LOSS

$ (472,178)

$ (440,418)
     

Net loss allocated to limited partners

$ (467,456)

$ (436,014)
     

Net loss allocated to general partner

$   (4,722)

$   (4,404)
     

Net loss per BAC

$     (.12)

$     (.11)
     

















The accompanying notes are an integral part of this statement

 

 

Boston Capital Tax Credit Fund III L.P.

STATEMENTS OF OPERATIONS

Three Months Ended June 30,
(Unaudited)

Series 16


2002


2001
     

Income

    

  Interest income

$     1,588

$     8,605

  Other income

     5,052

      -
 

     

     6,640

     8,605

Share of loss from Operating 
  Partnerships(Note D)

 (660,885)

 (608,222)
     

Expenses

    

  Professional fees

10,700

12,922

  Fund management fee    

106,590

 136,198

  Amortization

4,213

     4,213

  General and administrative expenses

     5,747

     5,230

  

  127,250

   158,563
     

  NET LOSS

$ (781,495)

$ (758,180)
     

Net loss allocated to limited partners

$ (773,680)

$ (750,598)
     

Net loss allocated to general partner

$   (7,815)

$   (7,582)
     

Net loss per BAC

$     (.14)

$     (.14)
     














 

 

 

The accompanying notes are an integral part of this statement

Boston Capital Tax Credit Fund III L.P.

STATEMENTS OF OPERATIONS

Three Months Ended June 30,
(Unaudited)

Series 17


2002


2001
     

Income

    

  Interest income

$     1,312

$     2,176

  Other income

      92

      -
 

     1,404

     2,176

Share of loss from Operating 
  Partnerships(Note D)

 (330,807)

 (481,118)
     

Expenses

    

  Professional fees

8,845

39,993

  Fund management fee    

117,876

119,219

  Amortization

3,887

3,888

  General and administrative expenses

     4,991

     5,361

  

  135,599

   168,461
     

  NET LOSS

$ (465,002)

$ (647,403)
     

Net loss allocated to limited partners

$ (460,352)

$ (640,929)
     

Net loss allocated to general partner

$   (4,650)

$   (6,474)
     

Net loss per BAC

$     (.09)

$     (.13)
     















 



The accompanying notes are an integral part of this statement

Boston Capital Tax Credit Fund III L.P.

STATEMENTS OF OPERATIONS
Three Months Ended June 30,
(Unaudited)

Series 18


2002


2001
     

Income

    

  Interest Income

$     1,021

$     2,879

  Other income

      -

      -
 

     1,021

     2,879

Share of loss from Operating 
  Partnerships(Note D)

 (488,008)

 (594,861)
     

Expenses

    

  Professional fees

7,216

6,309

  Fund management fee    

79,966

86,634

  Amortization

2,853

2,854

  General and administrative expenses

     3,795

     3,339

  

  93,830

    99,136
     

  NET LOSS

$ (580,817)

$ (691,118)
     

Net loss allocated to limited partners

$ (575,009)

$ (684,207)
     

Net loss allocated to general partner

$   (5,808)

$   (6,911)
     

Net loss per BAC

$     (.16)

$     (.19)
     















 



The accompanying notes are an integral part of this statement

 

Boston Capital Tax Credit Fund III L.P.

STATEMENTS OF OPERATIONS

Three Months Ended June 30,
(Unaudited)

Series 19


2002


2001
     

Income

    

  Interest income

$     1,510

$     9,137

  Other income

      -

      -

     1,510

  9,137

Share of loss from Operating 
  Partnerships(Note D)

 (283,692)

 (361,843)
     

Expenses

    

  Professional fees

6,005

4,493

  Fund management fee    

84,199

87,071

  Amortization

3,643

3,642

  General and administrative expenses

     4,267

     3,753

  

  98,114

    98,959
     

  NET LOSS

$ (380,296)

$ (451,665)
     

Net loss allocated to limited partners

$ (376,493)

$ (447,148)
     

Net loss allocated to general partner

$   (3,803)

$   (4,517)

Net loss per BAC

$     (.09)

$     (.11)
     



















The accompanying notes are an integral part of this statement

 

Boston Capital Tax Credit Fund III L.P.

STATEMENTS OF CHANGES IN PARTNERS' CAPITAL

Three Months Ended June 30, 2002
(Unaudited)

 





Assignees



General
Partner





Total
       

Partners' capital 
 (deficit)
  April 1, 2002



$ 66,120,988



$(1,240,862)



$ 64,880,126

    

      
       

Net income (loss)

(2,652,990)

   (26,798)

(2,679,788)
       

Partners' capital 
 (deficit),
  June 30, 2002



$ 63,467,998



$(1,267,660)



$ 62,200,338
       





























The accompanying notes are an integral part of this statement

Boston Capital Tax Credit Fund III L.P.

STATEMENTS OF CHANGES IN PARTNERS' CAPITAL

Three Months Ended June 30, 2002
(Unaudited)

 

Assignees

General
Partner

Total

Series 15

      

Partners' capital 
 (deficit)
  April 1, 2002



$  6,518,704



$  (270,186)



$  6,248,518

    

      
       

Net income (loss)

(467,456)

    (4,722)

(472,178)
       

Partners' capital 
 (deficit)
  June 30, 2002    



$  6,051,248



$  (274,908)



$  5,776,340
       
       

Series 16

      

Partners' capital 
 (deficit)
  April 1, 2002



$ 14,879,290



$  (321,027)



$ 14,558,263
       
       

Net income (loss)

(773,680)

    (7,815)

(781,495)
       

Partners' capital 
 (deficit)
  June 30, 2002    

 

$ 14,105,610

 

$ (328,842)

 

$ 13,776,768
       


















The accompanying notes are an integral part of these statements.

 

 

 

Boston Capital Tax Credit Fund III L.P.

STATEMENTS OF CHANGES IN PARTNERS' CAPITAL

Three Months Ended June 30, 2002
(Unaudited)

 

Assignees

General
Partner

Total

Series 17

      

Partners' capital 
 (deficit)
  April 1, 2002



$ 14,878,047



$  (283,737)



$ 14,594,310

    

      
       

Net income (loss)

(460,352)

  (4,650)

(465,002)
       

Partners' capital 
 (deficit)
  June 30, 2002    

 

$ 14,417,695

 

$ (288,387)

 

$ 14,129,308
       
       

Series 18

      

Partners' capital 
 (deficit)
  April 1, 2002



$ 11,256,559



$  (199,659)



$ 11,056,900
       
       

Net income (loss)

(575,009)

    (5,808)

(580,817)
       

Partners' capital 
 (deficit),
June 30, 2002   

 

$ 10,681,550

 

$ (205,467)

 

$ 10,476,083
       


















The accompanying notes are an integral part of this statement

 

 

 

Boston Capital Tax Credit Fund III L.P.

STATEMENTS OF CHANGES IN PARTNERS' CAPITAL

Three Months Ended June 30, 2002
(Unaudited)

 

Assignees

General
Partner

Total

Series 19

      

Partners' capital 
 (deficit)
  April 1, 2002



  $ 18,588,388



$  (166,253)



$ 18,422,135

    

      
       

Net income (loss)

(376,493)

    (3,803)

(380,296)
       

Partners' capital 
 (deficit),
  June 30, 2002

 

$ 18,211,895

 

$ (170,056)

 

$ 18,041,839
       
































The accompanying notes are an integral part of this statement

 

 

 

 

Boston Capital Tax Credit Fund III L.P.

STATEMENTS OF CASH FLOWS

Three Months Ended June 30,
(Unaudited)

 

2002

2001

Cash flows from operating activities:

    
     

   Net Loss

$(2,679,788)

$(2,988,784)

   Adjustments

    

      Distributions from Operating
        Partnerships


154,016


53,426

      Amortization

17,224

17,225

      Share of Loss from Operating
        Partnerships


2,120,766


2,356,628

   Changes in assets and liabilities

    

     (Decrease) Increase in accounts
        payable and accrued expenses


- -


      -

      Decrease (Increase) in other assets

(79)

(141,135)

      Decrease (Increase) in accounts
        payable affiliates


  249,257


   777,422
     

      Net cash (used in) provided by 
        operating activities


  (138,604)


   74,782
     
     

Cash flows from investing activities:

    
     

   Capital contributions paid to 
     Operating Partnerships


(70,144)


-

   Advances to Operating Partnerships

-

  -

   Investments

  -

    674,886
     

   Net cash (used in) provided by
     investing activities


  (70,144)


    674,886














The accompanying notes are an integral part of this statement

 

Boston Capital Tax Credit Fund III L.P.

STATEMENTS OF CASH FLOWS

Three Months Ended June 30,
(Unaudited)

 

2002

2001
     

Continued

    
     

Cash flows from financing activity:

    
     

   Credit adjusters received from
     Operating Partnerships


          -


          -
     

      Net cash (used in) provided by
        financing activity


          -


          -
     
     

      INCREASE (DECREASE) IN CASH AND
        CASH EQUIVALENTS


(208,748)


  749,668
     

Cash and cash equivalents, beginning

  2,273,043

  1,122,380
     

Cash and cash equivalents, ending

$  2,064,295

$  1,872,048
     




























The accompanying notes are an integral part of this statement

Boston Capital Tax Credit Fund III L.P.

STATEMENTS OF CASH FLOWS

Three Months Ended June 30,
(Unaudited)

Series 15

 

2002

2001

Cash flows from operating activities:

    
     

   Net Loss

$ (472,178)

$ (440,418)

   Adjustments

    

      Distributions from Operating
        Partnerships


3,111


313

Amortization

2,628

2,628

      Share of Loss from Operating
        Partnerships


357,374


310,584

   Changes in assets and liabilities

    

     (Decrease) Increase in accounts
        payable and accrued expenses


- -


- -

      Decrease (Increase) in other assets

-

(4,393)

      Decrease (Increase) in accounts
        payable affiliates


    37,012


    137,015
     

      Net cash (used in) provided by 
        operating activities


   (72,053)


      5,729
     
     

Cash flows from investing activities:

    
     

   Capital contributions paid to 
     Operating Partnerships


- -


- -

   Advances to Operating Partnerships

-

  -

   Investments

     -

     -
     

   Net cash (used in) provided by
     investing activities


     -


      -














The accompanying notes are an integral part of this statement

 

Boston Capital Tax Credit Fund III L.P.

STATEMENTS OF CASH FLOWS

Three Months Ended June 30,
(Unaudited)

Series 15

 

2002

2001
     

Continued

    
     

Cash flows from financing activity:

    
     

   Credit adjusters received from
     Operating Partnerships


          -


          -
     

      Net cash (used in) provided by
        financing activity


          -


          -
     
     

      INCREASE (DECREASE) IN CASH AND
        CASH EQUIVALENTS

 (72,053)

   5,729
     

Cash and cash equivalents, beginning

    444,415

    229,627
     

Cash and cash equivalents, ending

$    372,362

$    235,356
     




























The accompanying notes are an integral part of this statement

Boston Capital Tax Credit Fund III L.P.

STATEMENTS OF CASH FLOWS

Three Months Ended June 30,
(Unaudited)

Series 16

 

2002

2001

Cash flows from operating activities:

    
     

   Net Loss

$ (781,495)

$ (758,180)

   Adjustments

    

      Distributions from Operating
        Partnerships


2,211


3,679

      Amortization

4,213

4,213

      Share of Loss from Operating
        Partnerships


660,885


608,222

   Changes in assets and liabilities

    

     (Decrease) Increase in accounts
        payable and accrued expenses


- -


- -

      Decrease (Increase) in accounts
        receivable


-


1,093

      Decrease (Increase) in accounts
        payable affiliates


     72,992


    172,996
     

      Net cash (used in) provided by 
        operating activities


   (41,194)


    32,023
     
     

Cash flows from investing activities:

    
     

   Capital contributions paid to 
     Operating Partnerships


(60,144)


-

   Advances to Operating Partnerships

-

 -

   Investments

     -

    535,809
     

   Net cash (used in) provided by
     investing activities


  (60,144)


   535,809














The accompanying notes are an integral part of this statement

 

Boston Capital Tax Credit Fund III L.P.

STATEMENTS OF CASH FLOWS

Three Months Ended June 30,
(Unaudited)

Series 16

 

2002

2001
     

Continued

    
     

Cash flows from financing activity:

    
     

   Credit adjusters received from
     Operating Partnerships


          -


          -
     

      Net cash (used in) provided by
        financing activity


          -


          -
     
     

      INCREASE (DECREASE) IN CASH AND
        CASH EQUIVALENTS

(101,338)

567,832
     

Cash and cash equivalents, beginning

    489,893

    113,123
     

Cash and cash equivalents, ending

$    388,555

$    680,955
     




























The accompanying notes are an integral part of this statement

Boston Capital Tax Credit Fund III L.P.

STATEMENTS OF CASH FLOWS

Three Months Ended June 30,
(Unaudited)

Series 17

 

2002

2001

Cash flows from operating activities:

    
     

   Net Loss

$ (465,002)

$ (647,403)

   Adjustments

    

      Distributions from Operating
        Partnerships


2,830


12

      Amortization

3,887

3,888

      Share of Loss from Operating
        Partnerships


330,807


481,118

   Changes in assets and liabilities

    

     (Decrease) Increase in accounts
        payable and accrued expenses


- -


- -

      Decrease (Increase) in other assets

566

(128,160)

      Decrease (Increase) in accounts
        payable affiliates


    140,925

    269,085
 

 

  

      Net cash (used in) provided by 
        operating activities


     14,013


   (21,460)
     
     

Cash flows from investing activities:

    
     

   Capital contributions paid to 
     Operating Partnerships


(10,000)


-

   Advances to Operating Partnerships

-

-

   Investments

          -

          -
     

   Net cash (used in) provided by
     investing activities


   (10,000)


       -














The accompanying notes are an integral part of this statement

 

Boston Capital Tax Credit Fund III L.P.

STATEMENTS OF CASH FLOWS

Three Months Ended June 30,
(Unaudited)

Series 17

 

2002

2001
     

Continued

    
     

Cash flows from financing activity:

    
     

   Credit adjusters received from
     Operating Partnerships


          -


          -
     

      Net cash (used in) provided by
        financing activity


          -


          -
     
     

      INCREASE (DECREASE) IN CASH AND
        CASH EQUIVALENTS


4,013


 (21,460)
     

Cash and cash equivalents, beginning

    491,940

    397,122
     

Cash and cash equivalents, ending

$    495,953

$    375,662
     




























The accompanying notes are an integral part of this statement

Boston Capital Tax Credit Fund III L.P.

STATEMENTS OF CASH FLOWS

Three Months Ended June 30,
(Unaudited)

Series 18

 

2002

2001

Cash flows from operating activities:

    
     

   Net Loss

$ (580,817)

$ (691,118)

   Adjustments

    

      Distributions from Operating
        Partnerships


222


2,956

      Amortization

2,853

2,854

      Share of Loss from Operating
        Partnerships


488,008


594,861

   Changes in assets and liabilities

    

     (Decrease) Increase in accounts
        payable and accrued expenses


- -


- -

      Decrease (Increase) in accounts
        receivable


-


(1,749)

      Decrease (Increase) in accounts
        payable affiliates


     95,489


     95,487
     

      Net cash (used in) provided by 
        operating activities


    5,755


   3,291
     
     

Cash flows from investing activities:

    
     

   Capital contributions paid to 
     Operating Partnerships


- -


- -

   Advances to Operating Partnerships

  

-

   Investments

   -

     -
     

   Net cash (used in) provided by
     investing activities


     -


     -














The accompanying notes are an integral part of this statement

 

Boston Capital Tax Credit Fund III L.P.

STATEMENTS OF CASH FLOWS

Three Months Ended June 30,
(Unaudited)

Series 18

 

2002

2001
     

Continued

    
     

Cash flows from financing activity:

    
     

   Credit adjusters received from
     Operating Partnerships


          -


          -
     

      Net cash (used in) provided by
        financing activity


          -


          -
     
     

      INCREASE (DECREASE) IN CASH AND
        CASH EQUIVALENTS

5,755

3,291
     

Cash and cash equivalents, beginning

    365,987

    238,396
     

Cash and cash equivalents, ending

$    371,742

$    241,687
     




























The accompanying notes are an integral part of this statement

Boston Capital Tax Credit Fund III L.P.

STATEMENTS OF CASH FLOWS

Three Months Ended June 30,
(Unaudited)

Series 19

 

2002

2001

Cash flows from operating activities:

    
     

   Net Loss

$ (380,296)

$ (451,665)

   Adjustments

    

      Distributions from Operating
        Partnerships


145,642


46,466

      Amortization

3,643

3,642

      Share of Loss from Operating
        Partnerships


283,692


361,843

   Changes in assets and liabilities

    

     (Decrease) Increase in accounts
        payable and accrued expenses


- -


- -

      Decrease (Increase) in accounts
        receivable


(645)


(7,926)

      Decrease (Increase) in accounts
        payable affiliates


   (97,161)


    102,839
     

      Net cash (used in) provided by 
        operating activities


   (45,125)


   55,199
     
     

Cash flows from investing activities:

    
     

   Capital contributions paid to 
     Operating Partnerships


- -


-

   Advances to Operating Partnerships

-

 -

   Investments

     -

    139,077
     

   Net cash (used in) provided by
     investing activities


     -


    139,077














The accompanying notes are an integral part of this statement

 

Boston Capital Tax Credit Fund III L.P.

STATEMENTS OF CASH FLOWS

Three Months Ended June 30,
(Unaudited)

Series 19

 

2002

2001
     

Continued

    
     

Cash flows from financing activity:

    
     

   Credit adjusters received from
     Operating Partnerships


          -


          -
     

      Net cash (used in) provided by
        financing activity


          -


          -
     
     

      INCREASE (DECREASE) IN CASH AND
        CASH EQUIVALENTS

(45,125)

 194,276
     

Cash and cash equivalents, beginning

    480,808

    144,105
     

Cash and cash equivalents, ending

$    435,683

$    338,381
     




























The accompanying notes are an integral part of this statement

 

 

Boston Capital Tax Credit Fund III L.P.

NOTES TO FINANCIAL STATEMENTS
June 30, 2002

(Unaudited)

 

NOTE A - ORGANIZATION


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 is now BCA Associates Limited Partnership, a Massachusetts limited partnership, whose sole general partner is C&M Management, Inc., a Massachusetts corporation and 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 certain 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 June 26, 1992, December 28, 1992, June 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.  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 FINANCIAL STATEMENTS - CONTINUED
June 30, 2002

(Unaudited)

NOTE B - ACCOUNTING AND FINANCIAL REPORTING POLICIES

The condensed financial statements included herein as of June 30, 2002 and for the three 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.

Investments

The Fund has included in investments Certificates of Deposit with original materities of one year or less. These investments are carried at cost.





























Boston Capital Tax Credit Fund III L.P.

NOTES TO FINANCIAL STATEMENTS - CONTINUED
June 30, 2002

(Unaudited)

Amortization

On July 1, 1995, the Fund began amortizing unallocated acquisition costs over 330 months from April 1, 1995. As of June 30, 2002 the Fund has accumulated unallocated acquisition amortization totaling $505,003.  The breakdown of accumulated unallocated acquisition amortization within the fund as of June 30, 2002 and 2001 is as follows:

 

       2002

     2001
     

Series 15

$ 76,309

$ 65,797

Series 16

122,171

105,321

Series 17

120,640

105,090

Series 18

82,877

71,463

Series 19

103,006

 88,436

$505,003

$436,107

 

NOTE C - RELATED PARTY TRANSACTIONS

The Fund has entered into several transactions with various affiliates of the 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.  The fund management fees accrued for the quarter ended June 30, 2002 and 2001 are as follows:

 

        2002

        2001
     

Series 15

$137,013

$137,013

Series 16

172,995

172,995

Series 17

140,925

140,925

Series 18

95,487

95,487

Series 19

102,837

102,837
 

$649,257

$649,257




 

 

 

 

 

 

Boston Capital Tax Credit Fund III L.P.

NOTES TO FINANCIAL STATEMENTS - CONTINUED
June 30, 2002

(Unaudited)

NOTE D - INVESTMENTS IN OPERATING PARTNERSHIPS

At June 30, 2002 and 2001, the Fund had limited partnership interests in 241 Operating Partnerships which own or are constructing apartment complexes. The breakdown of Operating Partnerships within the Fund at June 30, 2002 and 2001 is as follows:

 

   

Series 15

68

Series 16

64

Series 17

49

Series 18

34

Series 19

 26
 

241


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 June 30, 2002 and 2001 are as follows:  

 

        2002

        2001
     

Series 15

$ 16,206

$   16,206

Series 16

78,362

138,506

Series 17

1,176,768

1,186,768

Series 18

18,554

18,554

Series 19

24,000

   24,000
 

$1,313,890

$1,384,034

 

The Funds 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 three months ended March 31, 2002.









 

Boston Capital Tax Credit Fund III L.P.

NOTES TO FINANCIAL STATEMENTS
June 30, 2002
(Unaudited)

NOTE D - INVESTMENTS IN OPERATING PARTNERSHIPS (continued)

COMBINED SUMMARIZED STATEMENTS OF OPERATIONS
Three Months Ended March 31,
(Unaudited)

Series 15

 

        2002

        2001
     

Revenues

    

   Rental

$  2,586,969

$  2,552,986

   Interest and other

    226,983

    100,993
     
 

  2,813,952

  2,653,979
     

Expenses

    

   Interest

775,740

690,636

   Depreciation and amortization

903,076

872,515

   Operating expenses

  1,747,919

  1,707,206
 

  3,426,735

  3,270,357
     

NET LOSS

$ (612,783)

$ (616,378)
     

Net loss allocation to Boston  
   Capital Tax Credit Fund 
   III L.P.



$  (357,374)



$ (310,584)
     
     

Net loss allocated to other 
   Partners


$    (6,128)


$    (6,164)
     

Net loss suspended

$  (249,281)

$  (299,630)

 

 

 

 

The Partnership accounts for its investments using the equity method of
accounting. Under the equity method of accounting, the Partnership adjusts
its investment cost for its share of each Operating Partnerships results of
operations and for any distributions received or accrued. However, the
Partnership 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 FINANCIAL STATEMENTS
June 30, 2002
(Unaudited)

NOTE D - INVESTMENTS IN OPERATING PARTNERSHIPS (continued)

COMBINED SUMMARIZED STATEMENTS OF OPERATIONS
Three Months Ended March 31,
(Unaudited)

Series 16

 

        2002

        2001
     

Revenues

    

   Rental

$  3,213,068

$  3,260,693

   Interest and other

   281,349

    131,989
     
 

  3,494,417

 3,392,682
     

Expenses

    

   Interest

988,543

    878,033

   Depreciation and amortization

1,130,573

1,152,243

   Operating expenses

  2,197,680

  2,118,641
 

  4,316,796

  4,148,917
     

NET LOSS

$ (822,379)

$ (756,235)
     

Net loss allocation to Boston  
   Capital Tax Credit Fund 
   III L.P.



$ (660,885)



$ (608,222)
     
     

Net loss allocated to other 
   Partners


$    (8,224)


$    (7,562)
     

Net loss suspended

$  (153,270)

$  (140,451)

 

 

 

 

The Partnership accounts for its investments using the equity method of
accounting. Under the equity method of accounting, the Partnership adjusts
its investment cost for its share of each Operating Partnerships results of
operations and for any distributions received or accrued. However, the
Partnership 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 FINANCIAL STATEMENTS
June 30, 2002
(Unaudited)

NOTE D - INVESTMENTS IN OPERATING PARTNERSHIPS (continued)

COMBINED SUMMARIZED STATEMENTS OF OPERATIONS
Three Months Ended March 31,
(Unaudited)

Series 17
 

        2002

        2001
     

Revenues

    

   Rental

$  3,220,034

$  3,040,833

   Interest and other

    153,110

    105,039
     
 

  3,373,144

  3,145,872
     

Expenses

    

   Interest

1,034,341

  942,480

   Depreciation and amortization

890,404

  957,277

   Operating expenses

  1,949,519

  1,870,452
 

  3,874,264

  3,770,209
     

NET LOSS

$ (501,120)

$ (624,337)
     

Net loss allocation to Boston  
   Capital Tax Credit Fund 
   III L.P.



$ (330,807)



$ (481,118)
     
     

Net loss allocated to other 
   Partners


$    (5,012)


$    (6,244)
     

Net loss suspended

$  (165,301)

$  (136,975)

 

 

 

 

The Partnership accounts for its investments using the equity method of
accounting. Under the equity method of accounting, the Partnership adjusts
its investment cost for its share of each Operating Partnerships results of
operations and for any distributions received or accrued. However, the
Partnership 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 FINANCIAL STATEMENTS
June 30, 2002
(Unaudited)

NOTE D - INVESTMENTS IN OPERATING PARTNERSHIPS (continued)

COMBINED SUMMARIZED STATEMENTS OF OPERATIONS
Three Months Ended March 31,
(Unaudited)

Series 18

 

        2002

        2001
     

Revenues

    

   Rental

$  1,732,553

$  1,691,947

   Interest and other

    123,044

    45,151
     
 

  1,855,597

  1,737,098
     

Expenses

    

   Interest

497,995

   512,831

   Depreciation and amortization

643,484

   642,559

   Operating expenses

  1,286,588

1,214,852
 

  2,428,067

  2,370,242
     

NET LOSS

$ (572,470)

$ (633,144)
     

Net loss allocation to Boston  
   Capital Tax Credit Fund 
   III L.P.



$ (488,008)



$ (594,861)
     
     

Net loss allocated to other 
   Partners


$    (5,725)


$    (6,331)

Net loss suspended

$   (78,737)

$   (31,952)

 

 

 

 

The Partnership accounts for its investments using the equity method of
accounting. Under the equity method of accounting, the Partnership adjusts
its investment cost for its share of each Operating Partnerships results of
operations and for any distributions received or accrued. However, the
Partnership 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 FINANCIAL STATEMENTS
June 30, 2002
(Unaudited)

NOTE D - INVESTMENTS IN OPERATING PARTNERSHIPS (continued)

COMBINED SUMMARIZED STATEMENTS OF OPERATIONS
Three Months Ended March 31,
(Unaudited)

Series 19
 

        2002

        2001
     

Revenues

    

   Rental

$  2,521,910

$  2,442,319

   Interest and other

    122,021

     61,362
     
 

  2,643,931

  2,503,681
     

Expenses

    

   Interest

839,223

   822,043

   Depreciation and amortization

704,516

   724,214

   Operating expenses

  1,399,207

  1,334,282
 

  2,942,946

  2,880,539
     

NET LOSS

$ (299,015)

$ (376,858)
     

Net loss allocation to Boston  

   Capital Tax Credit Fund 
   III L.P.



$ (283,692)



$ (361,843)
     
     

Net loss allocated to other 
   Partners


$    (2,990)


$    (3,769)
     

Net loss suspended

$   (12,333)

$   (11,246)

 

 

 

 

The Partnership accounts for its investments using the equity method of
accounting. Under the equity method of accounting, the Partnership adjusts
its investment cost for its share of each Operating Partnerships results of
operations and for any distributions received or accrued. However, the
Partnership 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 FINANCIAL STATEMENTS
June 30, 2002
(Unaudited)




NOTE E - TAXABLE LOSS

The Fund's taxable loss for the year ended December 31, 2002 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.  No provision or benefit for income taxes has been included in these financial statements since taxable income or loss passesthrough to, and is reportable by, the partners and assignees individually.

Item 2.  Management's Discussions and Analysis of Financial Condition and
Results of Operations

Liquidity

The Funds primary source of funds is the proceeds of its Public Offering.  Other sources of liquidity will include (i) interest earned on capital contributions held pending investment and on Working Capital Reserves and (ii) cash distributions from operations of the operating Partnerships in which the Fund has and will invest.  Interest income is expected to decrease over the life of the Fund as capital contributions are paid to the Operating Partnerships and Working Capital Reserves are expended.    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 June 30, 2002 were $649,257 and total fund management fees accrued as of June 30, 2002 were $15,869,309. Pursuant to the Partnership Agreement, such liabilities will be deferred until the Fund receives sales of refinancing proceeds from Operating Partnerships which will be used to satisfy such liabilities. The Funds 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 has recorded an additional $1,170,220 as payable to affiliates. This represents fundings to make advances and/or loans to certain Operating Partnerships in Series 15 and Series 17 of $213,564, and $956,656, respectively.

Capital Resources

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 June 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.

During the quarter ended June 30, 2002, none of Series 15 net offering proceeds had been used to pay capital contributions. Series 15 net offering proceeds in the amount of $16,206 remain to be used by the Fund to pay remaining capital contributions to the Operating Partnerships that Series 15 has invested in as of June 30, 2002.

(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.

     During the quarter ended June 30, 2002, $60,144 of Series 16 net offering proceeds had been used to pay capital contributions.  Series 16 net offering proceeds in the amount of $78,362 remain to be used by the Fund to pay remaining capital contributions to the Operating Partnerships that Series 16 has invested in as of June 30, 2002.

(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 June 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.

     During the quarter ended June 30, 2002, $10,000 of Series 17 net offering proceeds had been used to pay capital contributions.  Series 17 has outstanding contributions payable in the amount of $1,176,768 as of June 30, 2002. Of the amount outstanding, $1,139,873 has been advanced or loaned to the Operating Partnerships. The advances and loans will be converted to capital and the remaining contributions of $36,895 will be released from available net offering proceeds when the Operating Partnerships have achieved the conditions set forth in their partnership agreements.

(Series 18)  The Fund commenced offering BACs in Series 18 on June 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.

During the quarter ended June 30, 2002, none of Series 18 net offering proceeds had been used to pay capital contributions.  Series 18 net offering proceeds in the amount of $18,554 remain to be used by the Fund to pay remaining capital contributions to the Operating Partnerships that Series 18 has invested in as of June 30, 2002.

(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.

During the quarter ended June 30, 2002, none of Series 19 net offering proceeds had been used to pay capital contributions.  Series 19 net offering proceeds in the amount of $24,000 remain to be used by the Fund to pay remaining capital contributions to the Operating Partnerships that Series 19 has invested in as of June 30, 2002.

Results of Operations

As of June 30, 2002 and 2001 the Fund held limited partnership interests in 241 Operating Partnerships.  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 hereinafter 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 believes that there is adequate casualty insurance on the properties.

The Fund incurred a fund management fee to Boston Capital Asset Management Limited Partnerships (formerly Boston Capital Communications Limited Partnership) in an amount equal to .5 percent of the aggregate cost of the apartment complexes owned by the Operating Partnerships, less the amount of certain asset management and reporting fees paid by the Operating Partnerships.  The fund management fees incurred, net of reporting fees received, for the quarter ended June 30, 2002 for Series 15, Series 16, Series 17, Series 18 and Series 19 were $99,030, $106,590, $117,876, $79,966, and $84,199 respectively.

The Funds investment objectives do not include receipt of significant cash distributions from the Operating Partnerships in which it has invested or intends to invest.  The Funds 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 June 30, 2002 and 2001, the average qualified occupancy for the series was 100%.  The series had a total of 68 properties June 30, 2002, all of which were at 100% qualified occupancy.

For the three months being reported Series 15 reflects a net loss from Operating Partnerships of $612,783.  When adjusted for depreciation, which is a non-cash item, the Operating Partnerships reflect positive operations of $290,293.  This is an interim period estimate; it is not necessarily indicative of the final year end results.

Operations continue to improve at Hidden Cove Apartments (Hidden Cove) as evidenced by stabilized occupancy and increased rental collections. Occupancy through June 2002 has averaged 98%. To date, the property has been able to complete minor capital improvements and fund its replacement reserve account without outside financial assistance. The property is currently operating at or slightly above breakeven. Cash flow and reserves will be utilized to make improvements necessary to maintain building safety. The Operating General Partner has been negotiating to refinance the permanent mortgage. The mortgage note on the property was sold in the third quarter of 2001 to another party. The new lender is unwilling at this time to entertain any refinance proposal not involving a complete pay down of all outstanding debt, including all accrued interest. It is not in the Partnerships best interest to structure a refinance as proposed.

In April of 2000, School Street I LP, (School Street Apartments - Phase I) inserted Marshall School Street I, LLC, as the Operating General Partner and property management company. Since taking control, the Management Company completed the capital improvements program and improved the tenant selection criteria. As a result, physical occupancy at the property has increased and stabilized. During 2001 occupancy averaged 99%. The property averaged 98% for the first six months of 2002. The improved occupancy and the improved tenant selection criteria increased cash flow significantly during 2001, but operations still remained below breakeven due to high operating expenses. During 2001 operating expenses declined by 13% versus 2000. The General Partner projects the property to cash flow in the second half of 2002 as they further control operating expenses and increase rents. The Operating General Partner continues to fund any operating cash deficits. The mortgage, property taxes, insurance and payab les are current.

Series 16

As of June 30, 2002 and 2001, the average qualified occupancy for the series was 100% and 99.9%, respectively. The series had a total of 64 properties at June 30, 2002, all of which were at 100% qualified occupancy.

For the three months being reported Series 16 reflects a net loss from Operating Partnerships of $822,379.  When adjusted for depreciation, which is a non-cash item, the Operating Partnerships reflect positive operations of $308,194.  This is an interim period estimate; it is not necessarily indicative of the final year end results.

Cass Partners, L.P. (Fitzgerald Apartments) continues to operate below breakeven due to low occupancy. An increased supply of affordable housing in the area with superior amenities hampered marketing efforts and made tenant retention difficult. Average occupancy for 2001 was 70%, which increased slightly to 72% through the second quarter of 2002. In an effort to attract tenants property management lowered rents in June of 2001 and again in December of 2001. There are three commercial spaces at the property, two of which are currently vacant. Marketing efforts for the apartment units consist of referrals from the nearby Air Force Base, newspaper advertising and flyers. Also, the property is located on a main street in the center of town and accessible parking is limited. At the recommendation of the ILP, the management company has requested additional parking spaces from the City of Plattsmouth. The Operating General Partner continues to support the property financially. The mortgage, taxes, in surance and accounts payable are current.

Series 17

   As of June 30, 2002 and 2001, the average qualified occupancy for the series was 99.7%.  The series had a total of 49 properties at June 30, 2002.  Out of the total 48 were at 100% qualified occupancy.

For the three months being reported Series 17 reflects a net loss from Operating Partnerships of $501,120.  When adjusted for depreciation, which, is a non-cash item, the Operating Partnerships reflect positive operations of $389,284. This is an interim period estimate; it is not necessarily indicative of the final year end results.

Annadale Housing Partners (Annadale Apartments) has historically reported net losses due to operational issues associated with the property.  As a result of efforts by the management company operations have improved significantly. Rental increases combined with improved collections, increased rental revenues by $99,860 (11.3%) in 2001. This combined with stabilized operating expenses allowed the property to operate above breakeven. This positive trend has continued into the second quarter of 2002, with net rental income exceeding budgeted projections. Occupancy remains stable at 89% through the second quarter of 2002. In accordance with the loan agreements, the property continues to fund capital improvements from operations. A welfare tax exemption was approved in 2001, and the Partnership received a refund of $29,982 in January 2002. If operations continue to demonstrate improvement, the Investment General Partner will no longer continue to report on this Partnership.

Operations at California Investors VI (Orchard Park Apartments) continue to show improvement. Historically, the property has suffered from low occupancy due to the remote location of the site. The area has experienced economic growth over the past few years, and as a result operations at the property have improved as well. Occupancy remains stable averaging 97% through the second quarter of 2002. A rent increase was implemented in March 2001, resulting in an increase in rental revenues of $68,822 (9.1%)in 2001. The increase was phased in as leases expired. The full benefit of the increase has become evident in 2002. Reports submitted by management demonstrate a 13% increase in rental income for the first six months of 2002 compared with the prior year. The property operated below breakeven in 2001 largely due to the fact that the welfare tax exemption was not in place, and the property paid the full value of the property taxes. The exemption has been submitted, and if approved, the Partnership will receive a refund of approximately $32,000. The application is currently under review by the state. The Operating General Partner will continue to monitor the status of the exemption. In addition to the positive changes affecting this partnership, an affiliate of the management company assumed the General Partner responsibilities for the Partnership on January 1, 2001, and is now responsible for funding all future operating deficits.

Operations at Palmetto Properties Ltd. (Palmetto Villas) suffered from low occupancy in 1999 and the first half of 2000 due to poor on-site management and significant deferred maintenance issues. As a result, the property Management Company was replaced in January 2001. Since the management company change occurred, occupancy levels have steadily increased as improvements have been made at the property and deferred maintenance has been addressed. Occupancy averaged 95.07% for the year 2001, and remains steady at that level into the second quarter of 2002. Rental revenues increased by $62,670 in 2001 (an increase of 32.6% from the prior year) Property taxes remain an issue for this Partnership. Rural Development paid the 1998 delinquent taxes as an advance against the mortgage. The 1999 taxes were paid in 2001 from property operations. The Investment General Partner is attempting to work with Rural Development to develop a workout plan to address the tax issue. Attempts to negotiate a plan have been unsuccessful to date. Although the increased rental revenues have allowed the Partnership to escrow funds for the payment of taxes and insurance, fiscal year 2000 and 2001 taxes remain delinquent. The Investment General Partner continues negotiations with the current Operating General Partner aimed at removing him from the partnership. The new management company has expressed interest in assuming the role of Operating General Partner, and based on the management company's performance to date, the partnership would benefit from this arrangement.

Mt. Vernon Associates, L.P. (Green Court Apartments) is a 76-unit building located in Mt. Vernon, NY. The Partnership suffers from negative cash flow as a result of high operating expenses. The property has been able to meet obligations due to the Operating General Partner funding deficits. As the management agent is an affiliate of the Operating General Partner, the Partnership has also been deferring management fees. Operating statements through June 30, 2002 demonstrate operating expenses are running below budget, and as a result the Partnership is operating just slightly below breakeven. As a result of an audit performed by the State Agency in 1999, several instances of non-compliance were noted in the files. The non-compliance was reported to the IRS and subsequently 8823's were issued. Management has corrected the files to the best of their ability, however the files are not complete. The Investment General Partner has requested copies of the first year tenant files to make an assessment of the situation. Based upon a preliminary review, the Investment General Partner has a concern that the Partnership may not meet the minimum set-aside requirements, and may be subject to either partial recapture or disallowance of credits. To date no recapture of credits have been taken. The Operating General Partner and the Investment General Partner are continuing to work together along with legal counsel to determine an appropriate course of action. The Investment Limited Partner continues to monitor this situation closely.

Series 18

 As of June 30, 2002 and 2001 the average qualified occupancy for the series was 100%.  The series had a total of 34 properties at June 30, 2002, all of which were at 100% qualified occupancy.

For the three months being reported Series 18 reflects a net loss from Operating Partnerships of $572,470. When adjusted for depreciation, which is a non-cash item, the Operating Partnerships reflect positive operations of $71,014. This is an interim period estimate; it is not necessarily indicative of the final year end results.

Harris Housing Limited Partnership (Harris Music Lofts) located in West Palm Beach, Florida, operated slightly below break-even for the second quarter of 2002 mainly due to high operating expenses and high debt service payments. The property consists of 38 apartments with commercial space on the ground level. The apartments are predominately occupied by young, single residents. As a result, many of these residents have become first-time buyers which have led to somewhat increased turnover causing higher vacancies and increased turnover costs. The property continues to perform necessary maintenance including carpet replacement and roof repairs in order to preserve the existing asset and maintain the marketability of the rental units. Maintenance costs have risen over the years due to the aging of the property and the increased turnover noted above. The General Partner continues to share payroll costs including a community director, admin and maintenance personal with an affiliated property in the same neighborhood in an attempt to reduce expenses. Average occupancy for the second quarter of 2002 was 96%. The property taxes, insurance and replacement reserve deposits are current at June 30, 2002.

Parvin's Limited Partnership (Parvin's Branch Townhomes) continues to incur operating deficits due to high debt service payments.  The loan has an interest rate of 10.5% and is amortized over 15 years. The Investment Limited Partner will be working with the Operating General Partner on options for refinancing. The Operating General Partner and the management company have been deferring their respective fees to improve the property's cash flow.  In addition, the Operating General Partner continues to fund deficits. The average occupancy through June of 2002 was 96%. The mortgage, taxes, insurance and payables are current.

Glen Place Apartments Limited Partnership (Glen Place Apartments) received 60-Day letters issued by the IRS stating that the Operating Partnership had not met certain IRC Section 42 requirements for the tax years 1996 and 1997. The 60-Day letters were the result of an IRS audit of the Operating Partnership's tenant files. As a result of their audit, the IRS has proposed an adjustment that would disallow 59% of past and future tax credits. The adjustment will also include interest and penalties on the past tax credits being disallowed. The Investment General Partner and its counsel along with the Operating General Partner and its counsel have filed an appeal and continue ongoing discussions with the appellate officer. We believe the audit is nearing completion, and while an actual audit settlement has not been reached, it is our belief that there is a likelihood of a favorable settlement. However, in the absence of a settlement, the auditors continue to include a contingency footnote in the annual financial statement (Note I) which is a part of the most recently filed 10-K dated, March 31, 2002.

Chelsea Square Development LP (Chelsea Square Apartments) is a six unit property, which incurred negative cash flow during 2001 as a result of low residential rental rates, payment of back taxes and water/sewer and the non payment of commercial rental revenue to the property. To resolve the negative cash flow, residential and rental rates were increased in June 2001. Additionally, the General Partner began allocating the commercial rental income to the property in 2002. The back property taxes and water and sewer are on an approved payment plan with the municipality and will be brought current by the end of 2002. The property will not break even in 2002, however applications of current and past due commercial rental revenue, coupled with the rental rate increase should allow the property to breakeven in 2003. The mortgage and property insurance are current. The General Partner guarantee is unlimited as to amount and time.

Series 19

  As of June 30, 2002 and 2001 the average qualified occupancy for the series was 100%.  The series had a total of 26 properties at June 30, 2002, all of which were at 100% qualified occupancy.

For the three months being reported Series 19 reflects a net loss from Operating Partnerships of $299,015.  When adjusted for depreciation, which is a non-cash item, the Operating Partnerships reflect positive operations of $405,501. This is an interim period estimate; it is not necessarily indicative of the final year end results.

Carrollton Villa, L.P. (Carrollton Villa), located in Carrollton, Missouri, operated below breakeven during the second quarter of 2002 as a result of low occupancy. In anticipation of a changing housing market the property was reconfigured in late 2000 from 1 and 2 bedrooms only to include 3 and 4 bedroom units. Occupancy averaged 71% during the second quarter of 2002. Management is currently running ads in the local newspaper, and flyers with pull-tabs have been posted throughout the community and in surrounding areas. Moreover, the site manager has a very successful relationship with the local housing authority, which should generate tenant referrals. The property's mortgage, taxes and insurance were all current as of June 30, 2002.

 


PART II - OTHER INFORMATION

 

Item 1.

Legal Proceedings
   
 

None
   

Item 2.

Changes in Securities
   
 

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 (a) Certification pursuant to 18 U.S.C. Section 1350, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, filed herein
     
   

99 (b) Certification pursuant to 18 U.S.C. Section 1350, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, filed herein
   
 

(b)Reports on Form 8-K
   
   

None

 

 

 

 

 

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.  
 

Boston Capital Tax Credit Fund III L.P.
     
 

By:

Boston Capital Associates III L.P.
   

General Partner
     
 

By:

BCA Associates Limited Partnership,
   

General Partner
     
 

By:

C&M Management Inc.,
   

General Partner

Date:

    
     

August 20, 2002

By:

/s/ John P. Manning 
     
   

John P. Manning

 

 

  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:

DATE:

SIGNATURE:

TITLE:
     

August 20, 2002

/s/ John P. Manning

Director, President
   

(Principal Executive
 

John P. Manning

Officer) C&M Management
   

Inc.; Director,
   

President (Principal
   

Executive Officer)
   

BCTC III Assignor Corp.