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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
- ----- EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2002
OR
- ----- TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
Commission File Number 0-24650
INDEPENDENCE TAX CREDIT PLUS L.P. III
-------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 13-3746339
- --------------------------- -------------------
(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
INDEPENDENCE TAX CREDIT PLUS L.P. III
AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)
============ ============
September 30, March 31,
2002 2002
------------ ------------
ASSETS
Property and equipment - at cost,
less accumulated depreciation
of $15,724,286 and $14,367,307,
respectively $70,237,515 $71,576,597
Cash and cash equivalents 663,588 709,852
Cash held in escrow 5,384,898 5,200,566
Deferred costs, less accumulated
amortization of $413,774
and $385,422, respectively 813,987 842,339
Other assets 580,498 652,721
----------- -----------
Total assets $77,680,486 $78,982,075
=========== ===========
2
INDEPENDENCE TAX CREDIT PLUS L.P. III
AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(continued)
============= =============
September 30, March 31,
2002 2002
------------- -------------
LIABILITIES AND PARTNERS' CAPITAL (DEFICIT)
Liabilities:
Mortgage notes payable $ 42,991,232 $ 43,168,559
Construction loan payable 600,000 600,000
Accounts payable and other
liabilities 5,240,464 4,920,155
Due to local general partners and
affiliates 2,026,709 2,249,134
Due to general partner and affiliates 3,194,766 2,848,701
------------ ------------
Total liabilities 54,053,171 53,786,549
------------ ------------
Minority interest 3,419,528 3,455,741
------------ ------------
Commitments and contingencies (Note 3)
Partners' capital (deficit):
Limited partners (43,440 BACs
issued and outstanding) 20,391,837 21,908,515
General partner (184,050) (168,730)
------------ ------------
Total partners' capital (deficit) 20,207,787 21,739,785
------------ ------------
Total liabilities and partners' capital
(deficit) $ 77,680,486 $ 78,982,075
============ ============
See accompanying notes to consolidated financial statements.
3
INDEPENDENCE TAX CREDIT PLUS L.P. III
AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
========================== ==========================
Three Months Ended Six Months Ended
September 30, September 30,
-------------------------- --------------------------
2002 2001 2002 2001
-------------------------- --------------------------
Revenues
Rental income $ 1,534,211 $ 1,462,830 $ 3,048,627 $ 3,061,943
Other income 68,935 59,031 113,444 120,632
----------- ----------- ----------- -----------
Total revenues 1,603,146 1,521,861 3,162,071 3,182,575
----------- ----------- ----------- -----------
Expenses
General and ad-
ministrative 402,367 414,967 825,329 843,777
General and ad-
ministrative-
related parties
(Note 2) 219,089 209,512 431,419 421,982
Repairs and
maintenance 308,481 286,164 615,762 568,174
Operating 151,781 148,879 348,511 436,867
Taxes 86,658 83,889 159,502 153,034
Insurance 103,998 88,487 188,543 172,730
Financial, princi-
pally interest 387,742 389,766 764,411 769,445
Depreciation and
amortization 692,114 696,624 1,385,331 1,394,608
----------- ----------- ----------- -----------
Total expenses 2,352,230 2,318,288 4,718,808 4,760,617
----------- ----------- ----------- -----------
Net loss before
minority interest (749,084) (796,427) (1,556,737) (1,578,042)
Minority interest
in loss of subsidi-
ary partnerships 17,075 8,803 24,739 17,787
----------- ----------- ----------- -----------
Net loss $ (732,009) $ (787,624) $(1,531,998) $(1,560,255)
=========== =========== =========== ===========
Limited Partners
Share: Net loss -
limited partners $ (724,689) $ (779,747) $(1,516,678) $(1,544,652)
=========== =========== =========== ===========
Number of BACs
outstanding 43,440 43,440 43,440 43,440
=========== =========== =========== ===========
Net loss per BAC $ (16.68) $ (17.95) $ (34.91) $ (35.56)
=========== =========== =========== ===========
See accompanying notes to consolidated financial statements.
4
INDEPENDENCE TAX CREDIT PLUS L.P. III
AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CHANGES IN
PARTNERS' CAPITAL
(DEFICIT)
(Unaudited)
=================================================
Limited General
Total Partners Partner
-------------------------------------------------
Partners' capital -
(deficit)
April 1, 2002 $ 21,739,785 $ 21,908,515 $ (168,730)
Net loss - six
months ended
September 30, 2002 (1,531,998) (1,516,678) (15,320)
------------ ------------ ------------
Partners' capital -
(deficit)
September 30, 2002 $ 20,207,787 $ 20,391,837 $ (184,050)
============ ============ ============
See accompanying notes to consolidated financial statements.
5
INDEPENDENCE TAX CREDIT PLUS L.P. III
AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
(Unaudited)
===========================
Six Months Ended
September 30,
---------------------------
2002 2001
---------------------------
Cash flows from operating activities:
Net loss $(1,531,998) $(1,560,255)
----------- -----------
Adjustments to reconcile net loss to
net cash provided by (used in)
operating activities:
Depreciation and amortization 1,385,331 1,394,608
Minority interest in loss
of subsidiaries (24,739) (17,787)
Increase in cash held
in escrow (84,379) (440,378)
Decrease (increase) in other assets 72,223 (216,409)
Increase in accounts
payable and other liabilities 320,309 278,924
Increase in due to local general
partners and affiliates 18,375 23,399
Decrease in due to local general
partners and affiliates (10,871) (31,792)
Increase due to general partner
and affiliates 346,065 244,390
----------- -----------
Total adjustments 2,022,314 1,234,955
----------- -----------
Net cash provided by (used in)
operating activities 490,316 (325,300)
----------- -----------
Cash flows from investing activities:
Purchase of property
and equipment (17,897) (20,418)
Increase in cash held in escrow (99,953) (701,193)
Decrease in due to local general
partners and affiliates (229,929) (121,501)
----------- -----------
Net cash used in investing activities (347,779) (843,112)
----------- -----------
6
INDEPENDENCE TAX CREDIT PLUS L.P. III
AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
(Unaudited)
(continued)
===========================
Six Months Ended
September 30,
---------------------------
2002 2001
---------------------------
Cash flows from financing activities:
Repayments of mortgage notes (177,327) (85,270)
Decrease in due to local general
partners and affiliates 0 (10,239)
Decrease in capitalization
of consolidated subsidiaries
attributable to minority interest (11,474) (80,853)
----------- -----------
Net cash used in
financing activities (188,801) (176,362)
----------- -----------
Net decrease in cash and cash
equivalents (46,264) (1,344,774)
Cash and cash equivalents at
beginning of period 709,852 2,668,404
----------- -----------
Cash and cash equivalents at
end of period $ 663,588 $ 1,323,630
=========== ===========
7
INDEPENDENCE TAX CREDIT PLUS L.P. III
AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 2002
(Unaudited)
Note 1 - General
The consolidated financial statements include the accounts of Independence Tax
Credit Plus L.P. III (the "Partnership") and 20 other limited partnerships
("subsidiary partnerships", "subsidiaries" or "Local Partnerships") owning
apartment complexes that are eligible for the low-income housing tax credit. The
general partner of the Partnership is Related Independence Associates III L.P.,
a Delaware limited partnership (the "General Partner"). Through the rights of
the Partnership and/or an affiliate of the General Partner, which affiliate has
a contractual obligation to act on behalf of the Partnership, to remove the
general partner of the subsidiary local partnerships and to approve certain
major operating and financial decisions, the Partnership has a controlling
financial interest in the subsidiary partnerships.
For financial reporting purposes, the Partnership's fiscal quarter ends
September 30, 2002. All subsidiaries have fiscal quarters ending June 30, 2002.
Accounts of the subsidiaries have been adjusted for intercompany transactions
from July 1 through September 30. The Partnership's fiscal quarter ends
September 30 in order to allow adequate time for the subsidiaries financial
statements to be prepared and consolidated.
All intercompany accounts and transactions with the subsidiary partnerships 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 which exceed the minority interests'
investment in a subsidiary have been charged to the Partnership. Such losses
aggregated approximately $4,000 and $4,000 and $9,000 and $10,000 for the three
and six months ended September 30, 2002 and 2001, respectively. The
Partnership's investment in each subsidiary is equal to the respective
subsidiary's partners' equity less minority interest capital, if any. In
consolidation, all subsidiary partnership losses are included in the
Partnership's capital account except for losses allocated to minority interest
capital.
8
INDEPENDENCE TAX CREDIT PLUS L.P. III
AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 2002
(Unaudited)
Certain information and note disclosures normally included in financial
statements prepared in accordance with generally accepted accounting principles
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.
The books and records of the Partnership are maintained on the accrual basis of
accounting in accordance with generally accepted accounting principles. In the
opinion of the General Partner 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 its cash flows for the six
months ended September 30, 2002 and 2001. However, the operating results for the
six months ended September 30, 2002 may not be indicative of the results for the
year.
9
INDEPENDENCE TAX CREDIT PLUS L.P. III
AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 2002
(Unaudited)
Note 2 - Related Party Transactions
An affiliate of the General Partner has a .01% interest as a special limited
partner, in each of the Local Partnerships.
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) $ 95,500 $ 95,500 $191,000 $191,000
Expense reimburse-
ment (b) 40,916 26,266 80,086 55,891
Local administrative
fee (c) 15,000 14,000 30,000 28,000
-------- -------- -------- --------
Total general and
administrative-
General Partner 151,416 135,766 301,086 274,891
-------- -------- -------- --------
Property manage-
ment fees incurred
to affiliates of the
subsidiary partner-
ships' general part-
ners (d) 67,673 73,746 130,333 147,091
-------- -------- -------- --------
Total general and
administrative-
related parties $219,089 $209,512 $431,419 $421,982
======== ======== ======== ========
(a) The General Partner is 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 Partner in its sole discretion
based upon its review of the Partnership's investments. Unpaid partnership
management fees for any year will be accrued without interest and will be
payable only to the extent of available funds after the Partnership has made
distributions to the limited partners of sale or refinancing proceeds equal to
10
INDEPENDENCE TAX CREDIT PLUS L.P. III
AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 2002
(Unaudited)
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 Partner amounting to approximately $1,752,000 and $1,561,000 were
accrued and unpaid as of September 30, 2002 and March 31, 2002, respectively.
Without the General Partner's continued allowance of accrual without payment of
certain fees and expense reimbursements, the Partnership will not be in a
position to meet its obligations. The General Partner has continued to allow the
accrual without payment of these amounts but is under no obligation to continue
do so.
(b) The Partnership reimburses the General Partner and its affiliates for actual
Partnership operating expenses incurred by the General Partner and its
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 Partner performs asset monitoring for the Partnership.
These services include site visits and evaluations of the subsidiary
partnerships' performance.
(c) Independence SLP III L.P., a special limited partner of the subsidiary
partnerships, is entitled to receive a local administrative fee of up to $5,000
per year from each subsidiary partnership.
(d) Property management fees incurred by Local Partnerships amounted to $112,912
and $98,485 and $214,220 and $197,304 for the three and six months ended
September 30, 2002 and 2001, respectively. Of these fees $67,673 and $73,746 and
$130,333 and $147,091 were incurred to affiliates of the subsidiary
partnerships' general partners.
Note 3 - Commitments and Contingencies
There were no material changes and/or additions to disclosures regarding the
subsidiary partnerships which were included in the Partnership's Annual Report
on Form 10-K for the year ended March 30, 2002.
Lewis Street L.P.
- -----------------
In January of 1998, Lewis Street Limited Partnership ("Lewis Street") was
informed that it was a defendant in cause of action 1998-755 filed in Erie
County Supreme Court for the alleged value of work and services provided by
11
INDEPENDENCE TAX CREDIT PLUS L.P. III
AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 2002
(Unaudited)
Phase Six Paul for interference with contractual relations and for fraud that
was brought by the project's original developer. The complaint seeks damages for
the alleged value of work and services provided in the amount of $296,940 and
damages to reputation in the amount of at least $1,000,000 plus unspecified
punitive damages. This litigation has been vigorously contested by the Local
Partnership. Legal counsel for the Local Partnership has indicated that the
ultimate liability, if any, with respect to this possible action cannot be
determined at this time.
12
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations
Liquidity and Capital Resources
- -------------------------------
The Partnership's primary source of funds is interest earned on Gross Proceeds
which are invested in tax-exempt money market instruments pending final payments
to Local Partnerships. This source of funds is available to meet obligations of
the Partnership, although it does not generate a significant amount of cash to
the Partnership.
The Partnership has invested all of its net proceeds in twenty Local
Partnerships of which approximately $193,000 remains to be paid to the Local
Partnerships (not including approximately $297,000 being held in escrow).
For the six months ended September 30, 2002, cash and cash equivalents of the
Partnership and its twenty consolidated Local Partnerships decreased
approximately $46,000 due to purchases of property and equipment ($18,000), an
increase in cash held in escrow relating to investing activities ($100,000), a
decrease in due to local general partners and affiliates relating to investing
activities ($230,000), repayments of mortgage notes ($177,000) and a decrease in
capitalization of consolidated subsidiaries attributable to minority interest
($11,000) which exceeded cash provided by operating activities ($490,000).
Included in the adjustments to reconcile the net loss to cash provided by
operating activities is depreciation and amortization in the amount of
approximately $1,385,000.
During the six months ended September 30, 2002, the Partnership received no
distributions from operations of the Local Partnerships. Management anticipates
receiving distributions in the future, although not to a level sufficient to
permit providing cash distributions to the BACs holders. These distributions
will be set aside as working capital reserves and although likely not sufficient
to cover all Partnership expenses, will be used to meet the operating expenses
of the Partnership.
Partnership management fees owed to the General Partner amounting to
approximately $1,752,000 and $1,561,000 were accrued and unpaid as of September
30, 2002 and March 31, 2002, respectively (see Note 2). Without the General
Partner's continued accrual without payment of certain fees and expense
reimbursements, the Partnership will not be in a position to meet its
obligations. The General Partner has continued allowing the accrual without
payment of these amounts but is under no obligation to continue do so.
13
For a discussion of contingencies affecting certain Local Partnerships, see Note
3 to the financial statements. Since the maximum loss the Partnership would be
liable for is its net investment in the respective subsidiary partnerships, the
resolution of the existing contingencies is not anticipated to impact future
results of operations, liquidity or financial condition in a material way.
However, the Partnership's loss of its investment in a Local Partnership will
eliminate the ability to generate future tax credits from such Local Partnership
and may also result in recapture of tax credits if the investment is lost before
the expiration of the compliance period.
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 be experiencing upswings. However, the geographic
diversification of the portfolio may not protect against a general downturn in
the national economy. The Partnership has invested the proceeds of its offering
in twenty Local Partnerships, all of which fully have their tax credits in
place. The tax credits are attached to the project for a period of ten years,
and are transferable with the property during the remainder of such ten year
period. If the General Partner determined that a sale of a property is
warranted, the remaining tax credits would transfer to the new owner, thereby
adding value to the property on the market, which are not included in the
financial statement carrying amount.
Results of Operations
- ---------------------
The Partnership's results of operations for the three and six months ended
September 30, 2002 and 2001 consisted primarily of the results of the
Partnership's investment in twenty consolidated Local Partnerships. The majority
of Local Partnership income continues to be in the form of rental income with
the corresponding expenses being divided among operations, depreciation and
mortgage interest.
Rental income increased by approximately 5% and decreased less than 1% for the
three and six months ended September 30, 2002 as compared to 2001. The increase
for the three months is primarily due to an increase in rental rates. The
decrease for the six months is primarily due to an overaccrual of rent subsidies
in 2001 at one Local Partnership.
14
Other income increased approximately $10,000 for the three months ended
September 30, 2002 as compared to 2001, primarily due to an underaccrual of
interest income in 2001 at one Local Partnership, partially offset by a decrease
in 2002 in interest earned at the Partnership level and Local Partnerships due
to a decrease in interest rates, as well as lower cash and cash equivalent
balances earning interest at the Partnership level.
Total expenses, excluding operating and insurance, remained fairly consistent
with an increase of approximately 1% for both the three and six months ended
September 30, 2002 as compared to 2001.
Operating expense decreased approximately $88,000 for the six months ended
September 30, 2002 as compared to 2001, primarily due to the underaccrual of
utilities at two Local Partnerships in 2000.
Insurance expense increased approximately $15,000 and $15,000 for the three and
six months ended September 30, 2002, as compared to 2001, primarily due to an
increase in insurance premiums at one Local Partnership.
Item 3. Quantitative and Qualitative Disclosures about Market Risk
None.
Item 4. Controls and Procedures
The Chief Executive Officer and Chief Financial Officer of Related Independence
Associates III L.P., which is the general partner of Independence Tax Credit
Plus L.P. III (the "Partnership"), have 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 have 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.
15
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
(3A) Agreement of Limited Partnership of Independence Tax Credit
Plus L.P. III as adopted on December 23, 1993*
(3B) Form of Amended and Restated Agreement of Limited
Partnership of Independence Tax Credit Plus L.P. III, attached to the Prospectus
as Exhibit A**
(3C) Certificate of Limited Partnership of Independence Tax
Credit Plus L.P. III as filed on December 23, 1993*
(10A) Form of Subscription Agreement attached to the Prospectus
as Exhibit B**
(10B) Escrow Agreement between Independence Tax Credit Plus L.P.
III and Bankers Trust Company*
(10C) Form of Purchase and Sales Agreement pertaining to the
Partnership's acquisition of Local Partnership Interests*
(10D) Form of Amended and Restated Agreement of Limited
Partnership of Local Partnerships*
99.1 Certification Pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
*Incorporated herein as an exhibit by reference to exhibits filed
with Post-Effective Amendment No. 4 to the Registration Statement on Form S-11
{Registration No. 33-37704}
16
**Incorporated herein as an exhibit by reference to exhibits
filed with Post-Effective Amendment No. 8 to the Registration Statement on Form
S-11 {Registration No. 33-37704}
(b) Reports on Form 8-K - No reports on Form 8-K were filed
during this quarter.
17
SIGNATURES
Pursuant to the requirements 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.
INDEPENDENCE TAX CREDIT PLUS L.P. III
-------------------------------------
(Registrant)
By: RELATED INDEPENDENCE
ASSOCIATES III L.P., General Partner
By: RELATED INDEPENDENCE
ASSOCIATES III INC., General Partner
Date: November 13, 2002
By: /s/ Alan P. Hirmes
------------------
Alan P. Hirmes,
President
(principal executive and financial officer)
Date: November 13, 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 Independence Associates III Inc. ("RIAI"), the general partner of
Related Independence Associates III L.P. (the "General Partner"), which is the
general partner of Independence Tax Credit Plus L.P. III (the "Partnership"),
hereby certify that:
1. I have reviewed this quarterly report on Form 10-Q for the period
ending 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 to state 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 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 board of directors of RIAI:
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.
By: /s/ Alan P. Hirmes
------------------
Alan P. Hirmes
Principal Executive Officer and
Principal Financial Officer
November 13, 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 Independence Tax Credit Plus L.P. III
(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, Chief Executive Officer and Chief Financial
Officer of Related Independence Associates III Inc. a general partner of Related
Independence Associates III L.P., the general partner of the Partnership,
certify, pursuant to 18 U.S.C. ss. 1350, as adopted pursuant to ss. 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
------------------
Alan P. Hirmes
Principal Executive Officer and Principal Financial Officer
November 13, 2002