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FORM 10-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(Mark One)
|X| ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the fiscal year ended March 31, 2003
OR
|_| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from __________ to __________
Commission file number: 0-21494
WNC HOUSING TAX CREDIT FUND III, L.P.
California 33-0463432
State or other jurisdiction of (I.R.S. Employer
incorporation or organization Identification No.)
3158 Redhill Avenue, Suite 120, Costa Mesa, CA 92626
(714) 662-5565
Securities registered pursuant to Section 12(b) of the Act:
NONE
Securities registered pursuant to section 12(g) of the Act:
UNITS OF LIMITED PARTNERSHIP INTEREST
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes X No
---------- ---------
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. |X|
Indicate by check mark whether the registrant is an accelerated
Yes No X
---------- ---------
State the aggregate market value of the voting and non-voting common equity held
by non-affiliates computed by reference to the price at which the common equity
was last sold, or the average bid and asked price of such common equity, as of
the last business day of the registrant's most recently completed second fiscal
quarter.
INAPPLICABLE
DOCUMENTS INCORPORATED BY REFERENCE
List hereunder the following documents if incorporated by reference and the Part
of the Form 10-K (e.g., Part I, Part II, etc.) into which the document is
incorporated: (1) Any annual report to security holders; (2) Any proxy or
information statement; and (3) Any prospectus filed pursuant to Rule 424(b) or
(c) under the Securities Act of 1933. The listed documents should be clearly
described for identification purposes (e.g., annual report to security holders
for fiscal year ended December 24, 1980).
NONE
2
UNIT I.
Item 1. Business
Organization
WNC Housing Tax Credit Fund III, L.P. ("the Partnership") is a California
Limited Partnership formed under the laws of the State of California on May 10,
1991. The Partnership was formed to acquire limited partnership interests in
other limited partnerships or limited liability companies ("Local Limited
Partnerships") which own multifamily apartment complexes that are eligible for
low-income housing federal and, in some cases, California income tax credits
(the "Low Income Housing Credit").
The general partner of the Partnership is WNC Tax Credit Partners, L.P. ("TCP"
or the "General Partner"). The chairman and president own substantially all of
the outstanding stock of WNC. The business of the Partnership is conducted
primarily through WNC, as the Partnership has no employees of its own.
Pursuant to a registration statement filed with the Securities and Exchange
Commission on January 2, 1992, the Partnership commenced a public offering of
15,000 Units of Limited Partnership Interest ("Units") at a price of $1,000 per
Unit. As of the close of the public offering on September 30, 1993, a total of
15,000 Units representing $15,000,000 had been sold. Holders of Units are
referred to herein as "Limited Partners."
Description of Business
The Partnership's principal business objective is to provide its Limited
Partners with Low Income Housing Credits. The Partnership's principal business
therefore consists of investing as a limited partner or non-managing member in
Local Limited Partnerships each of which will own and operate a multi-family
housing complex (the "Housing Complexes") which will qualify for the Low Income
Housing Credit. In general, under Section 42 of the Internal Revenue Code, an
owner of low-income housing can receive the Low Income Housing Credit to be used
to reduce Federal taxes otherwise due in each year of a ten-year period. In
general, under Section 17058 of the California Revenue and Taxation Code, an
owner of low-income housing can receive the Low Income Housing Credit to be used
against California taxes otherwise due in each year of a four-year period. Each
Housing Complex is subject to a fifteen-year compliance period (the "Compliance
Period"), and under state law may have to be maintained as low income housing
for 30 or more years.
In general, in order to avoid recapture of Low Income Housing Credits, the
Partnership does not expect that it will dispose of its interests in Local
Limited Partnerships ("Local Limited Partnership Interests") or approve the sale
by any Local Limited Partnership of its Housing Complex prior to the end of the
applicable Compliance Period. Because of (i) the nature of the Housing
Complexes, (ii) the difficulty of predicting the resale market for low-income
housing 15 or more years in the future, and (iii) the ability of government
lenders to disapprove of transfer, it is not possible at this time to predict
whether the liquidation of the Partnership's assets and the disposition of the
proceeds, if any, in accordance with the Partnership's Agreement of Limited
Partnership, dated May 10, 1991 (the "Partnership Agreement"), will be able to
be accomplished promptly at the end of the 15-year period. If a Local Limited
Partnership is unable to sell its Housing Complex, it is anticipated that the
local general partner ("Local General Partner") will either continue to operate
such Housing Complex or take such other actions as the Local General Partner
believes to be in the best interest of the Local Limited Partnership.
Notwithstanding the preceding, circumstances beyond the control of the General
Partner or the Local General Partners may occur during the Compliance Period,
which would require the Partnership to approve the disposition of a Housing
Complex prior to the end thereof, possibly resulting in recapture of Low Income
Housing Credits.
As of March 31, 2003, the Partnership had invested in forty-eight Local Limited
Partnerships. Each of these Local Limited Partnerships owns a Housing Complex
that is eligible for the federal Low Income Housing Credit. Certain Local
Limited Partnerships may also benefit from government programs promoting low- or
moderate-income housing.
3
Certain Risks and Uncertainties
An investment in the Partnership and the Partnership's investments in Local
Limited Partnerships and their Housing Complexes are subject to risks. These
risks may impact the tax benefits of an investment in the Partnership, and the
amount of proceeds available for distribution to the Limited Partners, if any,
on liquidation of the Partnership's investments. Some of those risks include the
following:
The Low Income Housing Credit rules are extremely complicated. Noncompliance
with these rules results in the loss of future Low Income Housing Credits and
the fractional recapture of Low Income Housing Credits already taken. In most
cases the annual amount of Low Income Housing Credits that an individual can use
is limited to the tax liability due on the person's last $25,000 of taxable
income. The Local Limited Partnerships may be unable to sell the Housing
Complexes at a profit. Accordingly, the Partnership may be unable to distribute
any cash to its investors. Low Income Housing Credits may be the only benefit
from an investment in the Partnership.
The Partnership has invested in a limited number of Local Limited Partnerships.
Such limited diversity means that the results of operation of each single
Housing Complex will have a greater impact on the Partnership. With limited
diversity, poor performance of one Housing Complex could impair the
Partnership's ability to satisfy its investment objectives. Each Housing Complex
is subject to mortgage indebtedness. If a Local Limited Partnership failed to
pay its mortgage, it could lose its Housing Complex in foreclosure. If
foreclosure were to occur during the first 15 years, the loss of any remaining
Low Income Housing Credits, a fractional recapture of prior Low Income Housing
Credits and a loss of the Partnership's investment in the Housing Complex would
occur. The Partnership is a limited partner or non-managing member of each Local
Limited Partnership. Accordingly, the Partnership will have very limited rights
with respect to management of the Local Limited Partnerships. The Partnership
will rely totally on the Local General Partners. Neither the Partnership's
investments in Local Limited Partnerships, nor the Local Limited Partnerships'
investments in Housing Complexes, are readily marketable. To the extent the
Housing Complexes receive government financing or operating subsidies, they may
be subject to one or more of the following risks: difficulties in obtaining
tenants for the Housing Complexes; difficulties in obtaining rent increases;
limitations on cash distributions; limitations on sales or refinancing of
Housing Complexes; limitations on transfers of interests in Local Limited
Partnerships; limitations on removal of Local General Partners; limitations on
subsidy programs; and possible changes in applicable regulations. Uninsured
casualties could result in loss of property and Low Income Housing Credits and
recapture of Low Income Housing Credits previously taken. The value of real
estate is subject to risks from fluctuating economic conditions, including
employment rates, inflation, tax, environmental, land use and zoning policies,
supply and demand of similar properties, and neighborhood conditions, among
others.
The ability of Limited Partners to claim tax losses from the Partnership is
limited. The IRS may audit the Partnership or a Local Limited Partnership and
challenge the tax treatment of tax items. The amount of Low Income Housing
Credits and tax losses allocable to the investors could be reduced if the IRS
were successful in such a challenge. The alternative minimum tax could reduce
tax benefits from an investment in the Partnership. Changes in tax laws could
also impact the tax benefits from an investment in the Partnership and/or the
value of the Housing Complexes.
No trading market for the Units exists or is expected to develop. Investors may
be unable to sell their Units except at a discount and should consider their
Units to be a long-term investment. Individual investors will have no recourse
if they disagree with actions authorized by a vote of the majority of Limited
Partners.
Exit Strategy
The IRS compliance period for low-income housing tax credit properties is
generally 15 years from occupancy following construction or rehabilitation
completion. WNC was one of the first in the industry to offer investments using
the tax credit. Now these very first programs are completing their compliance
period.
With that in mind, we are continuing our review of the Partnership's holdings,
with special emphasis on the more mature properties including those that have
satisfied the IRS compliance requirements. Our review will consider many factors
including extended use requirements on the property (such as those due to
mortgage restrictions or state compliance agreements), the condition of the
property, and the tax consequences to the investors from the sale of the
property.
4
Upon identifying those properties with the highest potential for a successful
sale, refinancing or syndication, we expect to proceed with efforts to liquidate
those properties. Our objective is to maximize the investors' return wherever
possible and, ultimately, to wind down those funds that no longer provide tax
benefits to investors. To date no properties in the Partnership have been
selected.
Item 2. Properties
Through its investments in Local Limited Partnerships, the Partnership holds
limited partnership interests in the Housing Complexes. The following table
reflects the status of the forty-eight Housing Complexes as of the dates and for
the periods indicated:
5
---------------------------------- -----------------------------------------------
As of March 31, 2003 As of December 31, 2002
---------------------------------- -----------------------------------------------
Partnership's Original
Total Original Estimated Low Encumbrances
Investment in Amount of Income of Local
General Partner Local Limited Investment Number Housing Limited
Partnership Name Location Name Partnerships Paid to Date of Units Occupancy Credits Partnerships
- ------------------------------------------------------------------------------------------------------------------------------------
Beaumont
Elderly
Housing, Beaumont, Donald W.
L.P. Mississippi Sowell $ 229,000 $ 229,000 30 83% $ 462,000 $ 922,000
Brownfield
Seniors
Community, Brownfield, Winston
Ltd. Texas Sullivan 147,000 147,000 24 100% 292,000 707,000
Buffalo
Apartments, Buffalo, Donald W.
Ltd. Texas Sowell 91,000 91,000 24 100% 177,000 406,000
Cambridge
Court
Associates The
Limited Grottoes, Humphrey
Partnership Virginia Companies 254,000 254,000 39 100% 557,000 1,311,000
Candleridge
Apartments of Bondurant, Eric A.
Bondurant L.P. Iowa Sheldahl 99,000 99,000 23 100% 222,000 590,000
Candleridge
Apartments
of Waukee Waukee, Eric A.
L.P. Iowa Sheldahl 101,000 101,000 23 96% 227,000 644,000
Carlinville
Associates Carlinville, Kenneth M.
I, L.P. Illinois Vitor 105,000 105,000 20 90% 208,000 496,000
Thomas H. Cooksey
Cherokee Cedar and Apartment
Housing, Bluff, Developers,
Ltd. Alabama Inc. 110,000 110,000 19 100% 272,000 616,000
Chester
Associates
I, a Limited Chester, Kenneth M.
Partnership Illinois Vitor 159,000 159,000 24 92% 358,000 686,000
Clinton
Terrace
Apartments, Albany, Eddie C.
Ltd. Kentucky Dalton 138,000 138,000 24 96% 290,000 760,000
6
---------------------------------- -----------------------------------------------
As of March 31, 2003 As of December 31, 2002
---------------------------------- -----------------------------------------------
Partnership's Original
Total Original Estimated Low Encumbrances
Investment in Amount of Income of Local
General Partner Local Limited Investment Number Housing Limited
Partnership Name Location Name Partnerships Paid to Date of Units Occupancy Credits Partnerships
- ------------------------------------------------------------------------------------------------------------------------------------
Thomas H. Cooksey
Coffeeville and Apartment
Housing, Coffeeville, Developers,
Ltd. Alabama Inc. 103,000 103,000 19 63% 239,000 538,000
Coosa Thomas H. Cooksey
County and Apartment
Housing, Rockford, Developers,
Ltd. Alabama Inc. 103,000 103,000 19 95% 265,000 554,000
Crockett Crockett, Jean
Manor, Ltd. Texas Johnson 184,000 184,000 40 95% 383,000 880,000
Crockett
Manor Senior
Citizens Crockett, Jean
Complex, Ltd. Texas Johnson 203,000 203,000 36 97% 446,000 1,012,000
Delta Manor, Techula, Glenn D.
L.P. Mississippi Miller 227,000 227,000 36 92% 499,000 1,225,000
Eupora Richard Tenhet
Apartments, Eupora, and
L.P. Mississippi Geraldine Tenhet 138,000 138,000 36 94% 310,000 1,194,000
Fairview
Village V,
Limited Carroll,
Partnership Iowa Kevin A. Bierl 119,000 119,000 20 100% 273,000 584,000
Fox Lake Manor William E. Paschke,
Limited Fox Lake, Jr. and Robert E.
Partnership Wisconsin Campbell 84,000 84,000 12 50% 161,000 369,000
Thomas H. Cooksey
Ft. Deposit Fort and Apartment
Housing, Deposit, Developers,
Ltd. Alabama Inc. 127,000 127,000 23 87% 330,000 698,000
Gulf Coast
Apartments, Gulfport,
L.P. Mississippi Philip Napier 320,000 320,000 60 92% 698,000 1,409,000
Gulf Coast
Apartments
of Long Beach, Long Beach,
L.P. Mississippi Philip Napier 315,000 315,000 59 97% 685,000 1,425,000
7
---------------------------------- -----------------------------------------------
As of March 31, 2003 As of December 31, 2002
---------------------------------- -----------------------------------------------
Partnership's Original
Total Original Estimated Low Encumbrances
Investment in Amount of Income of Local
General Partner Local Limited Investment Number Housing Limited
Partnership Name Location Name Partnerships Paid to Date of Units Occupancy Credits Partnerships
- ------------------------------------------------------------------------------------------------------------------------------------
Heritage Robert J. Deharder
Colonial Blackshear, and Jacqueline F.
Homes, L.P. Georgia McPhillips 115,000 115,000 20 100% 126,000 521,000
HOI Limited Benson, Housing
Partnership North Opportunities,
of Benson Carolina Inc. 269,000 269,000 50 98% 577,000 1,162,000
HOI Limited Dallas, Housing
Partnership North Opportunities,
of Dallas Carolina Inc. 366,000 366,000 60 92% 787,000 1,681,000
HOI Limited Dunn, Housing
Partnership North Opportunities,
of Dunn Carolina Inc. 170,000 170,000 34 100% 366,000 809,000
HOI Limited Kings
Partnership Mountain, Housing
of Kings North Opportunities,
Mt. Carolina Inc. 262,000 262,000 46 93% 563,000 1,213,000
HOI Limited Sanford, Housing
Partnership North Opportunities,
of Lee Carolina Inc. 419,000 419,000 78 96% 901,000 1,952,000
HOI Limited Sanford, Housing
Partnership North Opportunities,
of Sanford Carolina Inc. 277,000 277,000 50 96% 594,000 1,213,000
HOI Limited Selma, Housing
Partnership North Opportunities,
of Selma Carolina Inc. 271,000 271,000 58 98% 582,000 1,169,000
Killbuck
Limited Killbuck, Georg E.
Partnership Ohio Maharg 151,000 151,000 24 79% 338,000 743,000
8
---------------------------------- -----------------------------------------------
As of March 31, 2003 As of December 31, 2002
---------------------------------- -----------------------------------------------
Partnership's Original
Total Original Estimated Low Encumbrances
Investment in Amount of Income of Local
General Partner Local Limited Investment Number Housing Limited
Partnership Name Location Name Partnerships Paid to Date of Units Occupancy Credits Partnerships
- ------------------------------------------------------------------------------------------------------------------------------------
Lake Ridge Lewis Beasley,
Apartments, Tiptonville, Jr. and
L.P. Tennessee Carol Beasley 317,000 317,000 44 100% 647,000 1,450,000
Levelland Levelland, 1600 Capital
Manor, L.P. Texas Company 175,000 175,000 36 100% 393,000 898,000
Logan Park
Associates
Limited Caldwell,
Partnership Idaho Riley J. Hill 571,000 571,000 50 96% 1,281,000 2,259,000
Meadow Run
Associates The
Limited Gordonsville, Humphrey
Partnership Virginia Companies 302,000 302,000 43 100% 662,000 1,483,000
Oakdale
Senior Oakdale
Housing Senior
Limited Oakdale, Housing
Partnership California Corporation 919,000 919,000 80 100% 2,110,000 2,900,000
Thomas H. Cooksey
Orange Beach Orange and Apartment
Housing, Beach, Developers,
Ltd. Alabama Inc. 208,000 208,000 31 87% 472,000 1,080,000
Parks I Sallie B. Garst
Limited Chatham, and
Partnership Virginia Lillien S. Brown 253,000 253,000 39 100% 568,000 1,232,000
Post Manor, Post, 1600 Capital
L.P. Texas Company 122,000 122,000 24 83% 263,000 627,000
Red Bud
Associates
I,a Limited Red Bud, Kenneth M.
Partnership Illinois Vitor 135,000 135,000 20 95% 303,000 594,000
Steeleville
Associates
I, a Limited Steeleville, Kenneth M.
Partnership Illinois Vitor 110,000 110,000 16 94% 247,000 546,000
9
---------------------------------- -----------------------------------------------
As of March 31, 2003 As of December 31, 2002
---------------------------------- -----------------------------------------------
Partnership's Original
Total Original Estimated Low Encumbrances
Investment in Amount of Income of Local
General Partner Local Limited Investment Number Housing Limited
Partnership Name Location Name Partnerships Paid to Date of Units Occupancy Credits Partnerships
- ------------------------------------------------------------------------------------------------------------------------------------
Tanglewood Georg E. Maharg
Limited Frankfurt, and Maharg
Partnership Ohio Realty, Inc. 212,000 212,000 36 100% 475,000 1,058,000
Village Lane
Properties,
a Limited Farmington, ERC Properties,
Partnership Arkansas Inc. 168,000 168,000 36 100% 370,000 879,000
Whitted Hillsborough
Forest Hillsborough, Affordable
Limited North Housing
Partnership Carolina Corporation 685,000 685,000 35 91% 1,572,000 973,000
Thomas H. Cooksey
Wilcam and Apartment
Housing, Camden, Developers,
Ltd. Alabama Inc. 106,000 106,000 19 100% 299,000 616,000
Wills Point Wills Point, 1600 Capital
Manor, L.P. Texas Company 124,000 124,000 24 100% 277,000 624,000
Windmere
Associates The
Limited Lexington, Humphrey
Partnership Virginia Companies 291,000 291,000 38 100% 539,000 1,476,000
Woodlands Mount
Apartments, Pleasant, 1600 Capital
L.P. Texas Company 239,000 239,000 48 94% 537,000 1,243,000
Chillicothe,
Woodview Illinois and
Limited Glassford, Michael K.
Partnership Illinois Moore 269,000 269,000 36 94% 362,000 1,187,000
------------ ------------ ------ --- ------------- ------------
$10,862,000 $ 10,862,000 1,685 94% $ 23,565,000 $ 48,614,000
============ ============ ====== === ============= ============
10
--------------------------------------------------------------------------------
For the year ended December 31, 2002
--------------------------------------------------------------------------------
Low Income
Housing Credits
Allocated to
Partnership Name Rental Income Net Income/(loss) Partnership
- -------------------------------------------------------------------------------------------------------------------
Beaumont Elderly Housing, L.P. $ 104,000 $ (21,000) 99%
Brownfield Seniors Community, Ltd. 117,000 (26,000) 99%
Buffalo Apartments, Ltd. 93,000 (3,000) 99%
Cambridge Court Associates
Limited Partnership 138,000 (44,000) 99%
Candleridge Apartments of
Bondurant L.P. 127,000 (14,000) 99%
Candleridge Apartments of Waukee
L.P. 137,000 (8,000) 99%
Carlinville Associates I, L.P. 65,000 (1,000) 99%
Cherokee Housing, Ltd. 75,000 (13,000) 99%
Chester Associates I, a Limited
Partnership 89,000 (6,000) 99%
Clinton Terrace Apartments, Ltd. 83,000 (8,000) 99%
Coffeeville Housing, Ltd. 41,000 (25,000) 99%
Coosa County Housing, Ltd. 67,000 (7,000) 99%
Crockett Manor, Ltd. 156,000 (14,000) 99%
Crockett Manor Senior Citizens
Complex, Ltd. 142,000 1,000 99%
Delta Manor, L.P. 154,000 (45,000) 99%
Eupora Apartments, L.P. 131,000 (15,000) 99%
Fairview Village V, Limited
Partnership 71,000 (14,000) 99%
Fox Lake Manor Limited Partnership 27,000 (12,000) 99%
Ft. Deposit Housing, Ltd. 83,000 (12,000) 99%
Gulf Coast Apartments, L.P. 226,000 (17,000) 99%
11
--------------------------------------------------------------------------------
For the year ended December 31, 2002
--------------------------------------------------------------------------------
Low Income
Housing Credits
Allocated to
Partnership Name Rental Income Net Income/(loss) Partnership
- -------------------------------------------------------------------------------------------------------------------
Gulf Coast Apartments of Long
Beach, L.P. 229,000 (19,000) 99%
Heritage Colonial Homes, L.P. 69,000 (19,000) 99%
HOI Limited Partnership of Benson 208,000 (24,000) 99%
HOI Limited Partnership of Dallas 234,000 (66,000) 99%
HOI Limited Partnership of Dunn 124,000 (51,000) 99%
HOI Limited Partnership of Kings
Mt. 162,000 (23,000) 99%
HOI Limited Partnership of Lee 318,000 (63,000) 99%
HOI Limited Partnership of Sanford 240,000 (27,000) 99%
HOI Limited Partnership of Selma 248,000 (10,000) 99%
Killbuck Limited Partnership 82,000 (22,000) 99%
Lake Ridge Apartments, L.P. 149,000 (54,000) 99%
Levelland Manor, L.P. 127,000 (25,000) 99%
Logan Park Associates Limited
Partnership 421,000 (26,000) 99%
Meadow Run Associates Limited
Partnership 168,000 (60,000) 99%
Oakdale Senior Housing Limited
Partnership 353,000 (237,000) 99%
Orange Beach Housing, Ltd. 116,000 (25,000) 99%
Parks I Limited Partnership 210,000 (24,000) 99%
Post Manor, L.P. 75,000 (23,000) 99%
Red Bud Associates I, a Limited
Partnership 67,000 (16,000) 99%
12
--------------------------------------------------------------------------------
For the year ended December 31, 2002
--------------------------------------------------------------------------------
Low Income
Housing Credits
Allocated to
Partnership Name Rental Income Net Income/(loss) Partnership
- -------------------------------------------------------------------------------------------------------------------
Steeleville Associates I, a
Limited Partnership 56,000 (15,000) 99%
Tanglewood Limited Partnership 115,000 (22,000) 99%
Village Lane Properties, a
Limited Partnership 173,000 (21,000) 99%
Whitted Forest Limited Partnership 181,000 (29,000) 99%
Wilcam Housing, Ltd. 74,000 (13,000) 99%
Wills Point Manor, L.P. 85,000 (24,000) 99%
Windmere Associates Limited
Partnership 173,000 (38,000) 99%
Woodlands Apartments, L.P. 162,000 (44,000) 99%
Woodview Limited Partnership 161,000 (27,000) 99%
----------- ------------
$ 6,906,000 $(1,351,000) 99%
=========== ============
13
Item 3. Legal Proceedings
NONE.
Item 4. Submission of Matters to a Vote of Security Holders
NONE.
PART II.
Item 5. Market for Registrant's Common Equity and Related Stockholder Matters
Item 5a.
(a) The Units are not traded on a public exchange but were sold through a
public offering. It is not anticipated that any public market will develop
for the purchase and sale of any Unit and none exists. Units can be
assigned only if certain requirements in the Partnership Agreement are
satisfied.
(b) At March 31, 2003, there were 1,040 Limited Partners.
(c) The Partnership was not designed to provide cash distributions to Limited
Partners in circumstances other than refinancing or disposition of its
investments in Local Limited Partnerships.
(d) No unregistered securities were sold by the Partnership during the year
ended March 31, 2003.
Item 5b.
NOT APPLICABLE
Item 6. Selected Financial Data
Selected balance sheet information for the Partnership is as follows:
March 31 December 31
----------------------------------------------------------------- ------------
2003 2002 2001 2000 1999 1998
----------- ---------- ----------- ----------- ------------ ------------
ASSETS
Cash and cash equivalents $ 251,056 $ 294,946 $ 310,526 $ 330,386 $ 335,746 $ 338,486
Investments in limited
partnerships, net 1,358,412 1,816,995 2,387,646 3,533,290 4,556,343 4,811,538
----------- ---------- ----------- ----------- ------------ ------------
$ 1,609,468 $ 2,111,941 $ 2,698,172 $ 3,863,676 $ 4,892,089 $ 5,150,024
=========== ========== =========== =========== ============ ============
LIABILITIES
Payables to limited
partnerships $ - $ - $ 50,818 $ 50,818 $ 50,818 $ 50,818
Accrued fees and expenses
due to General Partner
and affiliates 2,392,085 2,122,532 1,850,328 1,581,300 1,295,236 1,225,414
PARTNERS' (DEFICIT) EQUITY (782,617) (10,591) 797,026 2,231,558 3,546,035 3,873,792
----------- ---------- ----------- ----------- ------------ ------------
$ 1,609,468 $ 2,111,941 $ 2,698,172 $ 3,863,676 $ 4,892,089 $ 5,150,024
=========== ========== =========== =========== ============ ============
14
Selected results of operations, cash flows, and other information for the Partnership are as follows:
For the
For the Years Ended March 31 For the Three Months Year Ended
Ended March 31 December 31
-------------------------------------------------- ------------------------- -------------
2003 2002 2001 2000 1999 1998 1998
----------- ----------- ----------- ---------- ---------- ---------- -------------
(Unaudited)
Loss from operations $ (362,294) $ (312,218)$ (353,285)$ (354,817)$ (96,591)$ (86,217)$ (360,770)
Equity in losses of
limited
partnerships (409,732) (495,399) (1,081,247) (959,660) (231,166) (292,600) (1,047,939)
----------- ----------- ----------- ---------- ---------- ---------- -------------
Net loss $ (772,026) $ (807,617)$ (1,434,532)$ (1,314,477)$ (327,757)$ (378,817)$ (1,408,709)
=========== =========== =========== ========== ========== ========== =============
Net loss allocated to:
General partner $ (7,720) $ (8,076)$ (14,345)$ (13,145)$ (3,278)$ (3,788)$ (14,087)
=========== =========== =========== ========== ========== ========== =============
Limited partners $ (764,306) $ (799,541)$ (1,420,187)$ (1,301,332)$ (324,479)$ (375,029)$ (1,394,622)
=========== =========== =========== ========== ========== ========== =============
Net loss per limited
partner unit $ (50.95) $ (53.30)$ (94.68)$ (86.76)$ (21.63)$ (25.00)$ (92.97)
=========== =========== =========== ========== ========== =========== =============
Outstanding weighted
limited partner units 15,000 15,000 15,000 15,000 15,000 15,000 15,000
=========== =========== =========== ========== ========== ========== =============
For the
For the Years Ended March 31 For the Three Months Year Ended
Ended March 31 December 31
-------------------------------------------------- ------------------------- -------------
2003 2002 2001 2000 1999 1998 1998
----------- ----------- ----------- ---------- ---------- ---------- -------------
(Unaudited)
Net cash provided by
(used in):
Operating activities $ (63,801)$ (14,092)$ (37,009)$ (21,505)$ (14,957)$ (463)$ (11,507)
Investing activities 19,911 (1,488) 17,149 16,145 12,217 11,569 16,625
----------- ----------- ----------- ---------- ---------- ---------- ------------
Net change in cash and
cash equivalents (43,890) (15,580) (19,860) (5,360) (2,740) 11,106 5,118
Cash and cash
equivalents,
beginning of period 294,946 310,526 330,386 335,746 338,486 333,368 333,368
----------- ----------- ----------- ---------- ---------- ---------- ------------
Cash and cash
equivalents,
end of period $ 251,056 $ 294,946 $ 310,526 $ 330,386 $ 335,746 $ 344,474 $ 338,486
=========== =========== =========== ========== ========== ========== ============
Low Income Housing Credit per Unit was as follows for the years ended December 31:
2002 2001 2000 1999 1998
------------- --------------- --------------- ------------- --------------
Federal $ 136 $ 157 $ 157 $ 157 $ 157
State - - - - -
------------- --------------- --------------- ------------- -------------
Total $ 136 $ 157 $ 157 $ 157 $ 157
============= =============== =============== ============= ==============
15
Item 7. Management's Discussion and Analysis of Financial Condition and Results
of Operations
Forward Looking Statements
With the exception of the discussion regarding historical information,
"Management's Discussion and Analysis of Financial Condition and Results of
Operations" and other discussions elsewhere in this Form 10-K contain forward
looking statements. Such statements are based on current expectations subject to
uncertainties and other factors which may involve known and unknown risks that
could cause actual results of operations to differ materially from those
projected or implied. Further, certain forward-looking statements are based upon
assumptions about future events which may not prove to be accurate.
Risks and uncertainties inherent in forward looking statements include, but are
not limited to, our future cash flows and ability to obtain sufficient
financing, level of operating expenses, conditions in the low income housing tax
credit property market and the economy in general, as well as legal proceedings.
Historical results are not necessarily indicative of the operating results for
any future period.
Subsequent written and oral forward looking statements attributable to us or
persons acting on our behalf are expressly qualified in their entirety by
cautionary statements in this Form 10-K and in other reports we filed with the
Securities and Exchange Commission. The following discussion should be read in
conjunction with the Financial Statements and the Notes thereto included
elsewhere in this filing.
Critical Accounting Policies and Certain Risks and Uncertainties
The Company believes that the following discussion addresses the Partnership's
most significant accounting policies, which are the most critical to aid in
fully understanding and evaluating the Company's reported financial results, and
certain of the Partnership's risks and uncertainties.
Use of Estimates
The preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements, and the reported amounts of revenues and expenses
during the reporting period. Actual results could materially differ from those
estimates.
Method of Accounting For Investments in Limited Partnerships
The Partnership accounts for its investments in limited partnerships using the
equity method of accounting, whereby the Partnership adjusts its investment
balance for its share of the Local Limited Partnerships' results of operations
and for any contributions made or distributions received. The Partnership
reviews the carrying amount of an individual investment in a Local Limited
Partnership for possible impairment whenever events or changes in circumstances
indicate that the carrying amount of such investment may not be recoverable.
Recoverability of such investment is measured by a comparison of the carrying
amount to future undiscounted net cash flows expected to be generated. If an
investment is considered to be impaired, the impairment to be recognized is
measured by the amount by which the carrying amount of the investment exceeds
fair value. The accounting policies of the Local Limited Partnerships are
generally consistent with those of the Partnership. Costs incurred by the
Partnership in acquiring the investments are capitalized as part of the
investment account and are being amortized over 30 years.
Equity in losses of the Local Limited Partnerships for each year ended March 31
have been recorded by the Partnership based on nine months of reported results
provided by the Local Limited Partnerships for each year ended December 31 and
on three months of results estimated by management of the Partnership for each
three-month period ended March 31. Management's estimate for the three-month
period is based on either actual unaudited results reported by the Local Limited
Partnerships or historical trends in the operations of the Local Limited
Partnerships. Equity in losses of the Local Limited Partnerships are recognized
in the financial statements until the related investment account is reduced to a
zero balance. Losses incurred after the investment account is reduced to zero
are not recognized. If the Local Limited Partnerships report net income in
future years, the Partnership will
16
resume applying the equity method only after its share of such net income equals
the share of net losses not recognized during the period(s) the equity method
was suspended.
Distributions received from the Local Limited Partnerships are accounted for as
a reduction of the investment balance. Distributions received after the
investment has reached zero are recognized as income.
Income Taxes
No provision for income taxes has been recorded in the financial statements as
any liability for income taxes is the obligation of the partners of the
Partnership.
Certain Risks and Uncertainties
An investment in the Partnership and the Partnership's investments in Local
Limited Partnerships and their Housing Complexes are subject to risks. These
risks may impact the tax benefits of an investment in the Partnership, and the
amount of proceeds available for distribution to the Limited Partners, if any,
on liquidation of the Partnership's investments. Some of those risks include the
following:
The Low Income Housing Credit rules are extremely complicated. Noncompliance
with these rules results in the loss of future Low Income Housing Credit s and
the fractional recapture of Low Income Housing Credits already taken. In most
cases the annual amount of Low Income Housing Credits that an individual can use
is limited to the tax liability due on the person's last $25,000 of taxable
income. The Local Limited Partnerships may be unable to sell the Housing
Complexes at a profit. Accordingly, the Partnership may be unable to distribute
any cash to its investors. Low Income Housing Credits may be the only benefit
from an investment in the Partnership.
The Partnership has invested in a limited number of Local Limited Partnerships.
Such limited diversity means that the results of operation of each single
Housing Complex will have a greater impact on the Partnership. With limited
diversity, poor performance of one Housing Complex could impair the
Partnership's ability to satisfy its investment objectives. Each Housing Complex
is subject to mortgage indebtedness. If a Local Limited Partnership failed to
pay its mortgage, it could lose its Housing Complex in foreclosure. If
foreclosure were to occur during the first 15 years, the loss of any remaining
Low Income Housing Credits, a fractional recapture of prior Low Income Housing
Credits and a loss of the Partnership's investment in the Housing Complex would
occur. The Partnership is a limited partner or non-managing member of each Local
Limited Partnership. Accordingly, the Partnership will have very limited rights
with respect to management of the Local Limited Partnerships. The Partnership
will rely totally on the Local General Partners. Neither the Partnership's
investments in Local Limited Partnerships, nor the Local Limited Partnerships'
investments in Housing Complexes, are readily marketable. To the extent the
Housing Complexes receive government financing or operating subsidies, they may
be subject to one or more of the following risks: difficulties in obtaining
tenants for the Housing Complexes; difficulties in obtaining rent increases;
limitations on cash distributions; limitations on sales or refinancing of
Housing Complexes; limitations on transfers of interests in Local Limited
Partnerships; limitations on removal of Local General Partners; limitations on
subsidy programs; and possible changes in applicable regulations. Uninsured
casualties could result in loss of property and Low Income Housing Credits and
recapture of Low Income Housing Credits previously taken. The value of real
estate is subject to risks from fluctuating economic conditions, including
employment rates, inflation, tax, environmental, land use and zoning policies,
supply and demand of similar properties, and neighborhood conditions, among
others.
The ability of Limited Partners to claim tax losses from the Partnership is
limited. The IRS may audit the Partnership or a Local Limited Partnership and
challenge the tax treatment of tax items. The amount of Low Income Housing
Credits and tax losses allocable to the investors could be reduced if the IRS
were successful in such a challenge. The alternative minimum tax could reduce
tax benefits from an investment in the Partnership. Changes in tax laws could
also impact the tax benefits from an investment in the Partnership and/or the
value of the Housing Complexes.
No trading market for the Units exists or is expected to develop. Investors may
be unable to sell their Units except at a discount and should consider their
Units to be a long-term investment. Individual investors will have no recourse
if they disagree with actions authorized by a vote of the majority of Limited
Partners.
17
To date, certain Local Limited Partnerships have incurred significant operating
losses and have working capital deficiencies. In the event these Local Limited
Partnerships continue to incur significant operating losses, additional capital
contributions by the Partnership and/or the Local General Partner may be
required to sustain the operations of such Local Limited Partnerships. If
additional capital contributions are not made when they are required, the
Partnership's investment in certain of such Local Limited Partnerships could be
impaired, and the loss and recapture of the related tax credits could occur.
Financial Condition
The Partnership's assets at March 31, 2003 consisted primarily of $251,000 in
cash and aggregate investments in the forty-eight Local Limited Partnerships of
$1,358,000. Liabilities at March 31, 2003 primarily consisted of $2,392,000 of
accrued annual management fees and operating expenses due to the General
Partner.
Results of Operations
Year Ended March 31, 2003 Compared to Year Ended March 31, 2002. The
Partnership's net loss for the year ended March 31, 2003 was $(772,000),
reflecting a decrease of $36,000 from the net loss experienced for the year
ended March 31, 2002. The decline in net loss is due to a reduction in the
equity in losses of Local Limited Partnerships by $85,000. The decrease in
equity in losses of Local Limited Partnerships is primarily due to the
Partnership not recognizing certain losses of Local Limited Partnerships. The
investments in such Local Limited Partnerships had reached $0 at March 31, 2003.
Since the Partnership's liability with respect to its investments is limited,
losses in excess of investment are not recognized. The decrease in equity in
losses of limited partnerships is offset by an increase in loss from operations
by $50,000 due to a decrease in total income by $46,000 and an increase in
operating expenses by $4,000.
Year Ended March 31, 2002 Compared to Year Ended March 31, 2001. The
Partnership's net loss for the year ended March 31, 2002 was $(808,000),
reflecting a decrease of $627,000 from the net loss experienced for the year
ended March 31, 2001. The decrease in net loss is primarily due to equity in
losses of Local Limited Partnerships which decreased by $586,000 to $(495,000)
for the year ended March 31, 2002 from $(1,081,000) for the year ended March 31,
2001. The decrease in equity in losses of limited partnerships is due to the
decline in the reduction of the respective net acquisition fee component of
investments in Local Limited Partnerships to zero for those Local Limited
Partnerships which would otherwise be below a zero balance. This decline was in
conjunction with an increase of the Partnership not recognizing certain losses
of the Local Limited Partnerships. The investments in such Local Limited
Partnerships had reached $0 at March 31, 2002. Since the Partnership's liability
with respect to its investments is limited, losses in excess of investment are
not recognized. In addition, as the investment in such Local Limited
Partnerships had reached $0, distributions received were recognized as
distribution income, which resulted in an increase in distribution income of
$5,000 and reporting fee income of $39,000, offset by a decrease of interest
income of $10,000.
Liquidity and Capital Resources
Year Ended March 31, 2003 Compared to Year Ended March 31, 2002. Net cash used
during the year ended March 31, 2003 was $(44,000), compared to a net cash
decrease for the year ended March 31, 2002 of $(16,000). The change was due
primarily to an increase of $49,000 in net cash used by operating activities,
which was offset by an increase of $16,000 in distributions.
18
Year Ended March 31, 2002 Compared to Year Ended March 31, 2001. Net cash used
during the year ended March 31, 2002 was $(16,000), compared to net cash
decrease for the year ended March 31, 2001 of $(20,000). The change was due
primarily to an increase in reporting fees, offset by a decrease in interest and
distribution income along with an additional investment in limited partnerships.
During the years ended March 31, 2003, 2002 and 2001, accrued payables, which
consist primarily of related party management fees due to the General Partner,
increased by $270,000, 272,000 and $269,000, respectively. The General Partner
does not anticipate that these accrued fees will be paid in full until such time
as capital reserves are in excess of future foreseeable working capital
requirements of the Partnership.
The Partnership expects its future cash flows, together with its net available
assets at March 31, 2002, to be sufficient to meet all currently foreseeable
future cash requirements. This excludes amounts owed to Associates by the
Partnership disclosed below.
Future Contractual Cash Obligations
The following table summarizes our future contractual cash obligations as of
March 31, 2003:
2004 2005 2006 2007 2008 Thereafter Total
----------- --------- --------- --------- --------- ------------ -------------
Asset Management Fees (1) $ 2,688,911 $ 299,028 $ 299,028 $ 299,028 $ 299,028 $ 12,559,176 $ 16,444,199
Capital Contributions
Payable to Lower Tier
Partnerships - - - - - - -
----------- --------- --------- --------- --------- ------------ -------------
Total contractual cash
obligations $ 2,688,911 $ 299,028 $ 299,028 $ 299,028 $ 299,028 $ 12,559,176 $ 16,444,199
=========== ========= ========= ========= ========= ============ =============
(1) Asset Management Fees are payable annually until termination of the
Partnership, which is to occur no later than 2050. The estimate of the fees
payable included herein assumes the retention of the Partnership's interest
in all Housing Complexes until 2050. Amounts due to the General Partners as
of March 31, 2003 have been included in the 2004 column. The General
Partner does not anticipate that these fees will be paid until such time as
capital reserves are in excess of the future foreseeable working capital
requirements of the Partnership.
For additional information on our Asset Management Fees, see Note 3 to the
financial statements included elsewhere herein.
Exit Strategy
The IRS compliance period for low-income housing tax credit properties is
generally 15 years from occupancy following construction or rehabilitation
completion. WNC was one of the first in the industry to offer investments using
the tax credit. Now these very first programs are completing their compliance
period.
With that in mind, we are continuing our review of the Partnership's holdings,
with special emphasis on the more mature properties including those that have
satisfied the IRS compliance requirements. Our review will consider many factors
including extended use requirements on the property (such as those due to
mortgage restrictions or state compliance agreements), the condition of the
property, and the tax consequences to the investors from the sale of the
property.
Upon identifying those properties with the highest potential for a successful
sale, refinancing or syndication, we expect to proceed with efforts to liquidate
those properties. Our objective is to maximize the investors' return wherever
possible and, ultimately, to wind down those funds that no longer provide tax
benefits to investors. To date no properties in the Partnership have been
selected.
19
Impact of New Accounting Pronouncements
In June 2001, the Financial Accounting Standards Board ("FASB") issued Statement
of Financial Accounting Standards ("SFAS") No. 143, "Accounting for Asset
Retirement Obligations", which requires that the fair value of a liability for
an asset retirement obligation be recognized in the period in which it is
incurred with the associated asset retirement costs being capitalized as a part
of the carrying amount of the long-lived asset. SFAS No. 143 also includes
disclosure requirements that provide a description of asset retirement
obligations and reconciliation of changes in the components of those
obligations. The statement is effective for fiscal years beginning after June
15, 2002. The adoption of SFAS No. 143 did not have a material effect on the
Partnerhip's financial position or results of operations.
In August 2001, the FASB issued SFAS No. 144, "Impairment or Disposal of
Long-Lived Assets," which addresses accounting and financial reporting for the
impairment or disposal of long-lived assets. This standard was effective for the
Partnership's financial statements beginning January 1, 2002. The implementation
of SFAS No. 144 did not have a material impact on the Partnership's financial
position or results of operations.
In April 2002, the FASB issued SFAS No. 145, "Rescission of FASB Statements No.
4, 44, and 64, Amendment of FASB Statement No. 13, and Technical Corrections."
SFAS No. 145 rescinded three previously issued statements and amended SFAS No.
13, "Accounting for Leases." The statement provides reporting standards for debt
extinguishments and provides accounting standards for certain lease
modifications that have economic effects similar to sale-leaseback transactions.
The statement is effective for certain lease transactions occurring after May
15, 2002 and all other provisions of the statement shall be effective for
financial statements issued on or after May 15, 2002. The implementation of SFAS
No. 145 did not have a material impact on the Partnership's financial position
or results of operations.
In June 2002, the FASB issued SFAS No. 146, "Accounting for Costs Associated
with Exit or Disposal Activities," which updates accounting and reporting
standards for personnel and operational restructurings. The Partnership adopted
SFAS No. 146 for exit, disposal or other restructuring activities initiated
after December 31, 2002. The adoption of SFAS No. 146 did not have a material
effect on the Partnership's financial position or results of operations.
In November 2002, the FASB issued Interpretation No. 45 ("FIN 45"), "Guarantor's
Accounting and Disclosure Requirements for Guarantees, Including Indirect
Guarantees of Indebtedness of Others." The adoption of FIN 45 did not have a
material impact on the Partnership's finacial position or results of operations.
In December 2002, the FASB issued SFAS No. 148, "Accounting for Stock-Based
Compensation - Transition and Disclosure - an Amendment to SFAS No. 123." SFAS
No. 148 provides alternative methods of transition for a voluntary change to the
fair value based method on accounting for stock-based employee compensation. The
adoption of SFAS No. 148 did not have a material effect on the Partnership's
financial position or results of operations.
In January 2003, the FASB issued Interpretation No. 46 ("FIN 46"),
"Consolidation of Variable Interest Entities." The adoption of FIN 46 did not
have a material impact on the Partnership's financial position or results of
operations.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk
NOT APPLICABLE
Item 8. Financial Statements and Supplementary Data
20
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
To the Partners
WNC Housing Tax Credit Fund III, L.P.
We have audited the accompanying balance sheets of WNC Housing Tax Credit Fund
III, L.P. (a California Limited Partnership) (the "Partnership") as of March 31,
2003 and 2002, and the related statements of operations, partners' equity
(deficit) and cash flows for the years ended March 31, 2003, 2002 and 2001.
These financial statements are the responsibility of the Partnership's
management. Our responsibility is to express an opinion on these financial
statements based on our audits. A significant portion of the financial
statements of the limited partnerships in which the Partnership is a limited
partner were audited by other auditors whose reports have been furnished to us.
As discussed in Note 2 to the financial statements, the Partnership accounts for
its investments in limited partnerships using the equity method. The portion of
the Partnership's investment in limited partnerships audited by other auditors
represented 58% and 59% of the total assets of the Partnership at March 31, 2003
and 2002, respectively, and 58%, 64% and 59% of the Partnership's equity in
losses of limited partnerships for the years ended March 31, 2003, 2002 and
2001, respectively. Our opinion, insofar as it relates to the amounts included
in the financial statements for the limited partnerships which were audited by
others, is based solely on the reports of the other auditors.
We conducted our audits in accordance with auditing standards generally accepted
in the United States of America. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits and the reports of
the other auditors provide a reasonable basis for our opinion.
In our opinion, based on our audits and the reports of the other auditors, the
financial statements referred to above present fairly, in all material respects,
the financial position of WNC Housing Tax Credit Fund III, L.P. (a California
Limited Partnership) as of March 31, 2003 and 2002, and the results of its
operations and its cash flows for the years ended March 31, 2003, 2002 and 2001,
in conformity with accounting principles generally accepted in the United States
of America.
/s/ BDO SEIDMAN, LLP
Costa Mesa, California
June 24, 2003
21
WNC HOUSING TAX CREDIT FUND III, L.P.
(A California Limited Partnership)
BALANCE SHEETS
March 31
------------------------------
2003 2002
------------- --------------
ASSETS
Cash and cash equivalents $ 251,056 $ 294,946
Investments in limited partnerships, net (Notes 2 and 3) 1,358,412 1,816,995
------------- --------------
$ 1,609,468 $ 2,111,941
============= ==============
LIABILITIES AND PARTNERS' EQUITY (DEFICIT)
Liabilities:
Accrued fees and expenses due to General
Partner and affiliates (Note 3) $ 2,392,085 $ 2,122,532
============= ==============
Commitments and contingencies
Partners' equity (deficit):
General partner (48,347) (40,627)
Limited partners (15,000 units authorized;
15,000 units issued and outstanding) (734,270) 30,036
------------- --------------
Total partners' deficit (782,617) (10,591)
------------- --------------
$ 1,609,468 $ 2,111,941
============= ==============
See accompanying notes to financial statements
22
WNC HOUSING TAX CREDIT FUND III, L.P.
(A California Limited Partnership)
STATEMENTS OF OPERATIONS
For the Years Ended March 31
--------------------------------------------
2003 2002 2001
------------ ------------ -------------
Interest income $ 4,018 $ 8,115 $ 18,117
Reporting fee income 1,883 38,691 -
Distribution income - 4,870 12,220
------------ ------------ -------------
Total income 5,901 51,676 30,337
------------ ------------ -------------
Operating expenses:
Amortization (Notes 2 and 3) 28,940 25,922 47,248
Asset management fees (Note 3) 299,028 299,028 299,028
Other 40,227 38,944 37,346
------------ ------------ -------------
Total operating expenses 368,195 363,894 383,622
------------ ------------ -------------
Loss from operations (362,294) (312,218) (353,285)
Equity in losses of limited
partnerships (Note 2) (409,732) (495,399) (1,081,247)
------------ ------------ -------------
Net loss $ (772,026) $ (807,617)$ (1,434,532)
============ ============ =============
Net loss allocated to:
General partner $ (7,720) $ (8,076)$ (14,345)
============ ============ =============
Limited partners $ (764,306) $ (799,541)$ (1,420,187)
============ ============ =============
Net loss per limited partnership unit $ (50.95) $ (53.30)$ (94.68)
============ ============ =============
Outstanding weighted limited partner units 15,000 15,000 15,000
============ ============ =============
See accompanying notes to financial statements
23
WNC HOUSING TAX CREDIT FUND III, L.P.
(A California Limited Partnership)
STATEMENTS OF PARTNERS' EQUITY (DEFICIT)
For The Years Ended March 31, 2003, 2002 and 2001
General Limited Total
Partner Partners
--------------- --------------- ---------------
Partners' equity (deficit) at March 31, 2000 $ (18,206) $ 2,249,764 $ 2,231,558
Net loss (14,345) (1,420,187) (1,434,532)
--------------- --------------- ---------------
Partners' equity (deficit) at March 31, 2001 (32,551) 829,577 797,026
Net loss (8,076) (799,541) (807,617)
--------------- --------------- ---------------
Partners' equity (deficit) at March 31, 2002 (40,627) 30,036 (10,591)
Net loss (7,720) (764,306) (772,026)
--------------- --------------- ---------------
Partners' deficit at March 31, 2003 $ (48,347) $ (734,270) $ (782,617)
=============== =============== ===============
See accompanying notes to financial statements
24
WNC HOUSING TAX CREDIT FUND III, L.P.
(A California Limited Partnership)
STATEMENTS OF CASH FLOWS
For the Years Ended
March 31
------------------------------------------------
2003 2002 2001
------------- ------------- --------------
Cash flows from operating activities:
Net loss $ (772,026) $ (807,617)$ (1,434,532)
Adjustments to reconcile net loss to
net cash used in operating
activities:
Amortization 28,940 25,922 47,248
Equity in losses of limited
partnerships 409,732 495,399 1,081,247
Increase in accrued fees and
expenses due to General Partner
and affiliates 269,553 272,204 269,028
------------- ------------- --------------
Net cash used in operating activities (63,801) (14,092) (37,009)
------------- ------------- --------------
Cash flows from investing activities:
Investments in limited partnerships - (5,000) -
Distributions from limited
partnerships 19,911 3,512 17,149
------------- ------------- --------------
Net cash provided (used) by
investing activities 19,911 (1,488) 17,149
------------- ------------- --------------
Net decrease in cash and
cash equivalents (43,890) (15,580) (19,860)
Cash and cash equivalents, beginning
of period 294,946 310,526 330,386
------------- ------------- --------------
Cash and cash equivalents, end of
period $ 251,056 $ 294,946 $ 310,526
============= ============= ==============
SUPPLEMENTAL DISCLOSURE OF
CASH FLOW INFORMATION:
Taxes paid $ 800 $ 800 $ 800
============= ============= ==============
See accompanying notes to financial statements
25
WNC HOUSING TAX CREDIT FUND III, L.P.
(A California Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
For The Years Ended March 31, 2003, 2002 and 2001
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
- ---------------------------------------------------
Organization
- ------------
WNC Housing Tax Credit Fund III, L.P., a California Limited Partnership (the
"Partnership"), was formed on May 10, 1991 under the laws of the State of
California. The Partnership was formed to invest primarily in other limited
partnerships (the "Local Limited Partnerships") which own and operate
multi-family housing complexes (the "Housing Complexes") that are eligible for
low income housing credits. The local general partners (the "Local General
Partners") of each Local Limited Partnership retain responsibility for
maintaining, operating and managing the Housing Complex.
WNC & Associates, Inc., a California corporation ("WNC"), and Wilfred N. Cooper,
Sr., are general partners of the Partnership (the "General Partners"). The
chairman and president own substantially all of the outstanding stock of WNC.
The business of the Partnership is conducted primarily through WNC, as the
Partnership has no employees of its own.
The Partnership shall continue in full force and effect until December 31, 2050
unless terminated prior to that date pursuant to the partnership agreement or
law.
The financial statements include only activity relating to the business of the
Partnership, and do not give effect to any assets that the partners may have
outside of their interests in the Partnership, or to any obligations, including
income taxes, of the partners.
The Partnership Agreement authorized the sale of up to 15,000 units at $1,000
per Unit ("Units"). The offering of Units concluded on September 30, 1993 at
which time 15,000 Units representing subscriptions in the amount of $15,000,000
had been accepted. The General Partner has a 1% interest in operating profits
and losses, taxable income and losses, cash available for distribution from the
Partnership and tax credits. The limited partners will be allocated the
remaining 99% of these items in proportion to their respective investments.
After the limited partners have received proceeds from a sale or refinancing
equal to their capital contributions and their return on investment (as defined
in the Partnership Agreement) and the General Partner has received proceeds
equal to its capital contribution and a subordinated disposition fee (as
described in Note 3) from the remainder, any additional sale or refinancing
proceeds will be distributed 90% to the limited partners (in proportion to their
respective investments) and 10% to the General Partner.
Risks and Uncertainties
- -----------------------
An investment in the Partnership and the Partnership's investments in Local
Limited Partnerships and their Housing Complexes are subject to risks. These
risks may impact the tax benefits of an investment in the Partnership, and the
amount of proceeds available for distribution to the Limited Partners, if any,
on liquidation of the Partnership's investments. Some of those risks include the
following:
The Low Income Housing Credit rules are extremely complicated. Noncompliance
with these rules results in the loss of future Low Income Housing Credit s and
the fractional recapture of Low Income Housing Credits already taken. In most
cases the annual amount of Low Income Housing Credits that an individual can use
is limited to the tax liability due on the person's last $25,000 of taxable
income. The Local Limited Partnerships may be unable to sell the Housing
Complexes at a profit. Accordingly, the Partnership may be unable to distribute
any cash to its investors. Low Income Housing Credits may be the only benefit
from an investment in the Partnership.
26
WNC HOUSING TAX CREDITS FUND III, L.P.
(A California Limited Partnership)
NOTES TO FINANCIAL STATEMENTS - CONTINUED
For the Years Ended March 31, 2003, 2002 and 2001
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, continued
The Partnership has invested in a limited number of Local Limited Partnerships.
Such limited diversity means that the results of operation of each single
Housing Complex will have a greater impact on the Partnership. With limited
diversity, poor performance of one Housing Complex could impair the
Partnership's ability to satisfy its investment objectives. Each Housing Complex
is subject to mortgage indebtedness. If a Local Limited Partnership failed to
pay its mortgage, it could lose its Housing Complex in foreclosure. If
foreclosure were to occur during the first 15 years, the loss of any remaining
Low Income Housing Credits, a fractional recapture of prior Low Income Housing
Credits and a loss of the Partnership's investment in the Housing Complex would
occur. The Partnership is a limited partner or non-managing member of each Local
Limited Partnership. Accordingly, the Partnership will have very limited rights
with respect to management of the Local Limited Partnerships. The Partnership
will rely totally on the Local General Partners. Neither the Partnership's
investments in Local Limited Partnerships, nor the Local Limited Partnerships'
investments in Housing Complexes, are readily marketable. To the extent the
Housing Complexes receive government financing or operating subsidies, they may
be subject to one or more of the following risks: difficulties in obtaining
tenants for the Housing Complexes; difficulties in obtaining rent increases;
limitations on cash distributions; limitations on sales or refinancing of
Housing Complexes; limitations on transfers of interests in Local Limited
Partnerships; limitations on removal of Local General Partners; limitations on
subsidy programs; and possible changes in applicable regulations. Uninsured
casualties could result in loss of property and Low Income Housing Credits and
recapture of Low Income Housing Credits previously taken. The value of real
estate is subject to risks from fluctuating economic conditions, including
employment rates, inflation, tax, environmental, land use and zoning policies,
supply and demand of similar properties, and neighborhood conditions, among
others.
The ability of Limited Partners to claim tax losses from the Partnership is
limited. The IRS may audit the Partnership or a Local Limited Partnership and
challenge the tax treatment of tax items. The amount of Low Income Housing
Credits and tax losses allocable to the investors could be reduced if the IRS
were successful in such a challenge. The alternative minimum tax could reduce
tax benefits from an investment in the Partnership. Changes in tax laws could
also impact the tax benefits from an investment in the Partnership and/or the
value of the Housing Complexes.
No trading market for the Units exists or is expected to develop. Investors may
be unable to sell their Units except at a discount and should consider their
Units to be a long-term investment. Individual investors will have no recourse
if they disagree with actions authorized by a vote of the majority of Limited
Partners.
Exit Strategy
- -------------
The IRS compliance period for low-income housing tax credit properties is
generally 15 years from occupancy following construction or rehabilitation
completion. WNC was one of the first in the industry to offer investments using
the tax credit. Now these very first programs are completing their compliance
period.
With that in mind, the Partnership is continuing to review the Partnership's
holdings, with special emphasis on the more mature properties including those
that have satisfied the IRS compliance requirements. The Partnership's review
will consider many factors including extended use requirements on the property
(such as those due to mortgage restrictions or state compliance agreements), the
condition of the property, and the tax consequences to the investors from the
sale of the property.
Upon identifying those properties with the highest potential for a successful
sale, refinancing or syndication, the Partnership expects to proceed with
efforts to liquidate those properties. The Partnership's objective is to
maximize the investors' return wherever possible and, ultimately, to wind down
those funds that no longer provide tax benefits to investors. To date no
properties in the Partnership have been selected.
27
WNC HOUSING TAX CREDIT FUND III, L.P.
(A California Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
For The Years Ended March 31, 2003, 2002 and 2001
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, continued
Method of Accounting for Investments in Limited Partnerships
- ------------------------------------------------------------
The Partnership accounts for its investments in limited partnerships using the
equity method of accounting, whereby the Partnership adjusts its investment
balance for its share of the Local Limited Partnerships' results of operations
and for any contributions made and distributions received. The Partnership
reviews the carrying amount of an individual investment in a Local Limited
Partnership for possible impairment whenever events or changes in circumstances
indicate that the carrying amount of such investment may not be recoverable.
Recoverability of such investment is measured by a comparison of the carrying
amount to future undiscounted net cash flows expected to be generated. If an
investment is considered to be impaired, the impairment to be recognized is
measured by the amount by which the carrying amount of the investment exceeds
fair value. The accounting policies of the Local Limited Partnership's are
generally consistent with those of the Partnership. Costs incurred by the
Partnership in acquiring the investments are capitalized as part of the
investment account and are being amortized over 30 years (See Notes 2 and 3).
Equity in losses from Local Limited Partnerships for the years ended March 31,
2003, 2002 and 2001 have been recorded by the Partnership based on nine months
of reported results provided by the Local Limited Partnerships and on three
months of results estimated by management at the Partnership. Management's
estimate for the three-month period is based on either actual unaudited results
reported by the Local Limited Partnerships or historical trends in the
operations of the Local Limited Partnerships. Equity in losses from Local
Limited Partnerships allocated to the Partnership are not recognized to the
extent that the investment balance would be adjusted below zero. As soon as the
investment balance reaches zero, amortization of the related costs of acquiring
the investment are accelerated to the extent of losses available (See Note 3).
Offering Expenses
- -----------------
Offering expenses consist of underwriting commissions, legal fees, printing,
filing and recordation fees, and other costs incurred with selling limited
partnership interests in the Partnership. The General Partner is obligated to
pay all offering and organization costs in excess of 15% (including sales
commissions) of the total offering proceeds. Offering expenses are reflected as
a reduction of partners' capital and amounted to $2,250,000 at the end of all
periods presented.
Use of Estimates
- ----------------
The preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements, and the reported amounts of revenues and expenses
during the reporting period. Actual results could materially differ from those
estimates.
Cash and Cash Equivalents
- -------------------------
The Partnership considers all highly liquid investments with remaining
maturities of three months or less when purchased to be cash equivalents. As of
March 31, 2003 and 2002, the Partnership had cash equivalents of $0 and $12,288,
respectively.
28
WNC HOUSING TAX CREDIT FUND III, L.P.
(A California Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
For The Years Ended March 31, 2003, 2002 and 2001
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, continued
Concentration of Credit Risk
- ----------------------------
At March 31, 2003, the Partnership has maintained cash balances at a certain
financial institution in excess of the maximum federally insured amounts.
Net Loss Per Limited Partner Unit
- ---------------------------------
Net loss per limited partner unit is calculated pursuant to Statement of
Financial Accounting Standards No. 128, Earnings Per Share. Net loss per unit
includes no dilution and is computed by dividing loss available to limited
partners by the weighted average number of units outstanding during the period.
Calculation of diluted net loss per unit is not required.
Reporting Comprehensive Income
- ------------------------------
The Statement of Financial Accounting Standards ("SFAS") No. 130, Reporting
Comprehensive Income established standards for the reporting and display of
comprehensive income (loss) and its components in a full set of general-purpose
financial statements. The Partnership had no items of other comprehensive income
during the years ended March 31, 2002, 2001 and 2000, as defined by SFAS No.
130.
New Accounting Pronouncements
- -----------------------------
In June 2001, the Financial Accounting Standards Board ("FASB") issued Statement
of Financial Accounting Standards ("SFAS") No. 143, "Accounting for Asset
Retirement Obligations", which requires that the fair value of a liability for
an asset retirement obligation be recognized in the period in which it is
incurred with the associated asset retirement costs being capitalized as a part
of the carrying amount of the long-lived asset. SFAS No. 143 also includes
disclosure requirements that provide a description of asset retirement
obligations and reconciliation of changes in the components of those
obligations. The statement is effective for fiscal years beginning after June
15, 2002. The adoption of SFAS No. 143 did not have a material effect on the
Partnerhip's financial position or results of operations.
In August 2001, the FASB issued SFAS No. 144, "Impairment or Disposal of
Long-Lived Assets," which addresses accounting and financial reporting for the
impairment or disposal of long-lived assets. This standard was effective for the
Partnership's financial statements beginning January 1, 2002. The implementation
of SFAS No. 144 did not have a material impact on the Partnership's financial
position or results of operations.
In April 2002, the FASB issued SFAS No. 145, "Rescission of FASB Statements No.
4, 44, and 64, Amendment of FASB Statement No. 13, and Technical Corrections."
SFAS No. 145 rescinded three previously issued statements and amended SFAS No.
13, "Accounting for Leases." The statement provides reporting standards for debt
extinguishments and provides accounting standards for certain lease
modifications that have economic effects similar to sale-leaseback transactions.
The statement is effective for certain lease transactions occurring after May
15, 2002 and all other provisions of the statement shall be effective for
financial statements issued on or after May 15, 2002. The implementation of SFAS
No. 145 did not have a material impact on the Partnership's financial position
or results of operations.
In June 2002, the FASB issued SFAS No. 146, "Accounting for Costs Associated
with Exit or Disposal Activities," which updates accounting and reporting
standards for personnel and operational restructurings. The Partnership adopted
SFAS No. 146 for exit, disposal or other restructuring activities initiated
after December 31, 2002. The adoption of SFAS No. 146 did not have a material
effect on the Partnership's financial position or results of operations.
29
WNC HOUSING TAX CREDIT FUND III, L.P.
(A California Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
For The Years Ended March 31, 2003, 2002 and 2001
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, continued
In November 2002, the FASB issued Interpretation No. 45 ("FIN 45"), "Guarantor's
Accounting and Disclosure Requirements for Guarantees, Including Indirect
Guarantees of Indebtedness of Others." The adoption of FIN 45 did not have a
material impact on the Partnership's finacial position or results of operations.
In December 2002, the FASB issued SFAS No. 148, "Accounting for Stock-Based
Compensation - Transition and Disclosure - an Amendment to SFAS No. 123." SFAS
No. 148 provides alternative methods of transition for a voluntary change to the
fair value based method on accounting for stock-based employee compensation. The
adoption of SFAS No. 148 did not have a material effect on the Partnership's
financial position or results of operations.
In January 2003, the FASB issued Interpretation No. 46 ("FIN 46"),
"Consolidation of Variable Interest Entities." The adoption of FIN 46 did not
have a material impact on the Partnership's financial position or results of
operations.
NOTE 2 - INVESTMENTS IN LIMITED PARTNERSHIPS
For all periods presented, the Partnership had acquired limited partnership
interests in forty-eight Local Limited Partnerships, each of which owns one
Housing Complex consisting of an aggregate of 1,685 apartment units. The
respective Local General Partners of the Local Limited Partnerships manage the
day-to-day operations of the entities. Significant Local Limited Partnership
business decisions require approval from the Partnership. The Partnership, as a
limited partner, is generally entitled to 99%, as specified in the Local Limited
Partnership agreements, of the operating profits and losses, taxable income and
losses and tax credits of the Local Limited Partnerships.
The Partnership's investments in Local Limited Partnerships as reflected in the
balance sheets at March 31, 2003 and 2002, are approximately $3,931,000 and
$2,946,000, respectively, greater than the Partnership's combined equity at the
preceding December 31 as shown in the Local Limited Partnerships' combined
financial statements presented below. This difference is primarily due to
unrecorded losses, as discussed below, and acquisition, selection, and other
costs related to the acquisition of the investments which have been capitalized
in the Partnership's investment account. The Partnership's investment is also
lower than the Partnership's equity as shown in the Local Limited Partnership's
combined financial statements due to the losses recorded by the Partnership for
the three month period ended March 31.
Equity in losses of the Local Limited Partnerships is recognized in the
financial statements until the related investment account is reduced to a zero
balance. Losses incurred after the investment account is reduced to zero are not
recognized. If the Local Limited Partnerships report net income in future years,
the Partnership will resume applying the equity method only after its share of
such net income equals the share of net losses not recognized during the
period(s) the equity method was suspended.
Distributions from the Local Limited Partners are accounted for as a reduction
of the investment balance. Distributions received after the investment has
reached zero are recognized as income.
At March 31, 2003 and 2002, the investment accounts in certain Local Limited
Partnerships have reached a zero balance. Consequently, a portion of the
Partnership's estimate of its share of losses for the years ended March 31,
2003, 2002 and 2001 amounting to approximately $928,000, $823,000 and $329,000,
respectively, have not been recognized. As of March 31, 2003, the aggregate
share of net losses not recognized by the Partnership amounted to $3,158,000.
30
WNC HOUSING TAX CREDIT FUND III, L.P.
(A California Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
For The Years Ended March 31, 2003, 2002 and 2001
NOTE 2 - INVESTMENTS IN LIMITED PARTNERSHIPS, continued
Following is a summary of the equity method activity of the investments in Local
Limited Partnerships for the periods presented:
For the Years Ended
March 31
------------------------------------------------
2003 2002 2001
------------- -------------- --------------
Investments per balance sheet, beginning of period $ 1,816,995 $ 2,387,646 $ 3,533,290
Capital contributions paid - 5,000 -
Capital contributions payable to limited partnerships - (50,818) -
Equity in losses of limited partnerships (409,732) (495,399) (1,081,247)
Distributions received from limited partnerships (19,911) (3,512) (17,149)
Amortization of paid acquisition fees and costs (28,940) (25,922) (47,248)
------------- -------------- --------------
Investments per balance sheet, end of period $ 1,358,412 $ 1,816,995 $ 2,387,646
============= ============== ==============
The financial information from the individual financial statements of the Local
Limited Partnerships include rental and interest subsidies. Rental subsidies are
included in total revenues and interest subsidies are generally netted against
interest expense. Approximate combined condensed financial information from the
individual financial statements of the Local Limited Partnerships as of December
31 and for the years then ended is as follows:
COMBINED CONDENSED BALANCE SHEETS
2002 2001
--------------- ---------------
ASSETS
Buildings and improvements, net of accumulated
depreciation for 2002 and 2001 of $18,503,000 and
$16,668,000, respectively $ 42,602,000 $ 44,297,000
Land 4,173,000 4,100,000
Due from related parties - 3,000
Other assets 5,329,000 5,207,000
--------------- ---------------
$ 52,104,000 $ 53,607,000
=============== ===============
LIABILITIES
Mortgage loans payable $ 48,614,000 $ 48,907,000
Due to related parties 3,004,000 2,987,000
Other liabilities 924,000 905,000
--------------- ---------------
52,542,000 52,799,000
--------------- ---------------
PARTNERS' CAPITAL (DEFICIT)
WNC Housing Tax Credit Fund III, L.P. (2,573,000) (1,129,000)
Other partners 2,135,000 1,937,000
--------------- ---------------
(438,000) 808,000
--------------- ---------------
$ 52,104,000 $ 53,607,000
=============== ===============
31
WNC HOUSING TAX CREDIT FUND III, L.P.
(A California Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
For The Years Ended March 31, 2003, 2002 and 2001
NOTE 2 - INVESTMENTS IN LIMITED PARTNERSHIPS, continued
COMBINED CONDENSED STATEMENTS OF OPERATIONS
2002 2001 2000
--------------- --------------- ---------------
Revenues $ 7,088,000 $ 6,968,000 $ 6,616,000
--------------- --------------- ---------------
Expenses:
Operating expenses 4,811,000 4,513,000 4,352,000
Interest expense 1,760,000 1,894,000 1,783,000
Depreciation and amortization 1,868,000 1,898,000 1,902,000
--------------- --------------- ---------------
Total expenses 8,439,000 8,305,000 8,037,000
--------------- --------------- ---------------
Net loss $ (1,351,000) $ (1,337,000) $ (1,421,000)
=============== =============== ===============
Net loss allocable to the Partnership $ (1,338,000) $ (1,323,000) $ (1,407,000)
=============== =============== ===============
Net loss recorded by the Partnership $ (410,000) $ (495,000) $ (1,081,000)
=============== =============== ===============
Certain Local Limited Partnerships have incurred significant operating losses
and over 35% have working capital deficiencies. In the event these Local Limited
Partnerships continue to incur significant operating losses, additional capital
contributions by the Partnership and/or the Local General Partner may be
required to sustain the operations of such Local Limited Partnerships. If
additional capital contributions are not made when they are required, the
Partnership's investment in certain of such Local Limited Partnerships could be
impaired, and the loss and recapture of the related tax credits could occur.
NOTE 3 - RELATED PARTY TRANSACTIONS
Under the terms of the Partnership Agreement, the Partnership has paid or is
obligated to the General Partner or their affiliates for the following items:
Acquisition fees not to exceed 9% of the gross proceeds from the sale
of Units as compensation for services rendered in connection with the
acquisition of Local Limited Partnerships. At the end of all periods
presented, the Partnership incurred acquisition fees of $1,350,000.
Accumulated amortization of these capitalized costs was $1,038,126 and
$875,167 as of March 31, 2003 and 2002, respectively. Of the
accumulated amortization recorded on the balance sheet at March 31,
2003, $134,019, $106,359 and $391,520 of the related expense was
reflected as equity in losses of limited partnerships during the years
ended March 31, 2003, 2002 and 2001, respectively, to reduce the
respective net acquisition fee component of investments in local
limited partnerships to zero for those Local Limited Partnerships
which would otherwise be below a zero balance.
32
WNC HOUSING TAX CREDIT FUND III, L.P.
(A California Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
For The Years Ended March 31, 2003, 2002 and 2001
NOTE 3 - RELATED PARTY TRANSACTIONS, continued
Reimbursement of costs incurred by the General Partner or an affiliate
in connection with the acquisition of Local Limited Partnerships.
These reimbursements have not exceeded 1.6% of the gross proceeds. As
of the end of all periods presented, the Partnership incurred
acquisition costs of $67,423, which have been included in investments
in limited partnerships. Accumulated amortization was $67,423, as of
March 31, 2003 and 2002. Of the accumulated amortization recorded on
the balance sheet at March 31, 2003, $0, $0 and $50,037 of the related
expense was reflected as equity in losses of limited partnerships
during the years ended March 31, 2003, 2002 and 2001, respectively, to
reduce the respective net acquisition cost component of investments in
local limited partnerships to zero for those Local Limited
Partnerships which would otherwise be below a zero balance.
An annual asset management fee equal to 0.5% of the invested assets of
the Local Limited Partnerships, including the Partnership's allocable
share of the mortgages. Management fees of $299,028 were incurred
during each of the years ended March 31, 2003, 2002 and 2001; of which
$30,000, $28,500 and $30,000 were paid during the years ended March
31, 2003, 2002 and 2001, respectively.
A subordinated disposition fee in an amount equal to 1% of the sales
price of real estate sold. Payment of this fee is subordinated to the
limited partners receiving a preferred return of 16% through December
31, 2002 and 6% thereafter (as defined in the Partnership Agreement)
and is payable only if the General Partner or its affiliates render
services in the sales effort.
The accrued fees and expenses due to General Partner and affiliates consist of
the following at:
March 31
-----------------------------
2003 2002
------------ ------------
Advances from WNC $ 2,202 $ 1,677
Asset management fee payable 2,389,883 2,120,855
------------ ------------
$ 2,392,085 $ 2,122,532
============ ============
The General Partner does not anticipate that these accrued fees will be paid in
full until such time as capital reserves are in excess of the future foreseeable
working capital requirements of the Partnership.
NOTE 4 - INCOME TAXES
No provision for income taxes has been recorded in the accompanying financial
statements as any liability for income taxes is the obligation of the partners
of the Partnership.
33
WNC HOUSING TAX CREDIT FUND III, L.P.
(A California Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
For The Years Ended March 31, 2003, 2002 and 2001
NOTE 5 - QUARTERLY RESULTS OF OPERATIONS (UNAUDITED)
The following is a summary of the quarterly operations for the years ended March 31, 2003 and 2002:
June 30 September 30 December 31 March 31
--------------- --------------- --------------- ---------------
2003
Income $ 1,000 $ 8,000 $ 3,000 $ (6,000)
Operating expenses (91,000) (98,000) (86,000) (93,000)
Equity in losses of limited
partnerships (68,000) (75,000) (67,000) (200,000)
Net loss (158,000) (165,000) (150,000) (299,000)
Loss available to limited partners (157,000) (163,000) (149,000) (295,000)
Loss per limited partner unit (10) (11) (10) (20)
2002
Income $ 3,000 $ 20,000 $ 1,000 $ 28,000
Operating expenses (90,000) (100,000) (88,000) (86,000)
Equity in losses of limited
partnerships (122,000) (203,000) (131,000) (40,000)
Net loss (209,000) (283,000) (218,000) (98,000)
Loss available to limited partners (207,000) (280,000) (215,000) (97,000)
Loss per limited partner unit (14) (19) (15) (6)
34
Item 9. Changes in and Disagreements With Accountants on Accounting and
Financial Disclosure
NOT APPLICABLE
UNIT III.
Item 10. Directors and Executive Officers of the Registrant
(a) Identification of Directors, (b) Identification of Executive Officers, (c)
Identification of Certain Significant Employees, (d) Family Relationships,
and (e) Business Experience
The Partnership has no directors, executive officers or employees of its own.
The following biographical information is presented for the directors, executive
officers and significant employees of Associates, which has principal
responsibility for the Partnership's affairs.
Associates is a California corporation which was organized in 1971. Its officers
and significant employees are:
Wilfred N. Cooper, Sr. Chairman of the Board
Wilfred N. Cooper, Jr. President and Chief Executive Officer
David N. Shafer, Esq. Executive Vice President and Director of Asset Management
Sylvester P. Garban Senior Vice President - Institutional Investments
David C. Turek Senior Vice President - Originations
Thomas J. Riha, CPA Vice President - Chief Financial Officer
Michael J. Gaber Vice President - Acquisitions
Diemmy T. Tran Vice President - Portfolio Management
J. Brad Hurlbut Director of Syndications
In addition to Wilfred N. Cooper, Sr., the directors of Associates are Wilfred
N. Cooper, Jr., David N. Shafer, and Kay L. Cooper. The principal shareholder of
Associates is a trust established by Wilfred N. Cooper, Sr.
Wilfred N. Cooper, Sr., age 72, is the founder and Chairman of the Board of
Directors of Associates, a Director of WNC Capital Corporation, and a general
partner in some of the partnerships previously sponsored by Associates. Mr.
Cooper has been actively involved in the affordable housing industry since 1968.
Previously, during 1970 and 1971, he was founder and a principal of Creative
Equity Development Corporation, a predecessor of Associates, and of Creative
Equity Corporation, a real estate investment firm. For 12 years before that, Mr.
Cooper was employed by Rockwell International Corporation, last serving as its
manager of housing and urban developments where he had responsibility for
factory-built housing evaluation and project management in urban planning and
development. He has testified before committees of the U.S. Senate and the U.S.
House of Representatives. Mr. Cooper is a Life Director of the National
Association of Home Builders and a National Trustee for NAHB's Political Action
Committee, and the Chairman of NAHB's Multifamily Council. He is a Director of
the National Housing Conference and a member of NHC's Executive Committee, and a
founder and Director of the California Housing Consortium. He is the husband of
Kay Cooper and the father of Wilfred N. Cooper, Jr. Mr. Cooper graduated from
Pomona College in 1956 with a Bachelor of Arts degree.
Wilfred N. Cooper, Jr., age 40, is President, Chief Executive Officer, Secretary
and a Director and a member of the Acquisition Committee of Associates. He is
President of, and a registered principal with, WNC Capital Corporation, and is a
Director of WNC Management, Inc. He has been involved in real estate investment
and acquisition activities since 1988 when he joined Associates. Previously, he
served as a Government Affairs Assistant with Honda North America in Washington,
D.C. Mr. Cooper is a member of the Editorial Advisory Boards of Affordable
Housing Finance and LIHC Monthly Report, a Steering Member of the Housing Credit
Group of the National Association of Home Builders, an Alternate Director of
NAHB, a member of the Advisory Board of the New York State Association for
Affordable Housing and a member of the Urban Land Institute. He is the son of
Wilfred Cooper, Sr. and Kay Cooper. Mr. Cooper graduated from The American
University in 1985 with a Bachelor of Arts degree.
35
David N. Shafer, age 50, is Executive Vice President, a Director, Director of
Asset Management and a member of the Acquisition Committee of Associates, and a
Director and Secretary of WNC Management, Inc. Mr. Shafer has been active in the
real estate industry since 1984. Before joining Associates in 1990, he was
engaged as an attorney in the private practice of law with a specialty in real
estate and taxation. Mr. Shafer is a Director and President of the California
Council of Affordable Housing, and a member of the State Bar of California. Mr.
Shafer graduated from the University of California at Santa Barbara in 1978 with
a Bachelor of Arts degree, from the New England School of Law in 1983 with a
Juris Doctor degree cum laude and from the University of San Diego in 1986 with
a Master of Law degree in Taxation.
Sylvester P. Garban, age 57, is Senior Vice President - Institutional
Investments of Associates Mr. Garban has been involved in real estate investment
activities since 1978. Before joining Associates in 1989, he served as Executive
Vice President with MRW, Inc., a real estate development and management firm.
Mr. Garban is a member of the National Association of Affordable Housing Lenders
and the Financial Planning Association. He graduated from Michigan State
University in 1967 with a Bachelor of Science degree in Business Administration.
David C. Turek, age 48, is Senior Vice President - Originations of Associates.
His experience with real estate investments and finance has continued since
1976, and he has been employed by Associates since 1996. Previously, from 1995
to 1996, Mr. Turek served as a consultant for a national tax credit sponsor
where he was responsible for on-site feasibility studies and due diligence
analyses of tax credit properties. From 1992 to 1995 he served as Executive Vice
President for Levcor, Inc., a multi-family development company, and from 1990 to
1992 he served as Vice President for the Paragon Group where he was responsible
for tax credit development activities. He is a Director of the National Housing
and Rehabilitation Association, the Rural Rental Housing Association of Texas,
and the Alabama Council of Affordable Rental Housing. Mr. Turek graduated from
Southern Methodist University in 1976 with a Bachelor of Business Administration
degree.
Thomas J. Riha, age 47, is Vice President - Chief Financial Officer and a member
of the Acquisition Committee of Associates and President, Treasurer and a
Director of WNC Management, Inc. He has been involved in real estate acquisition
and investment activities since 1979. Before joining Associates in 1994, Mr.
Riha was employed by Trust Realty Advisor, a real estate acquisition and
management company, last serving as Vice President - Operations. He is a
Director of the Task Force on Housing Credit Certification of the National
Association of Home Builders. Mr. Riha graduated from the California State
University, Fullerton in 1977 with a Bachelor of Arts degree cum laude in
Business Administration with a concentration in Accounting and is a Certified
Public Accountant and a member of the American Institute of Certified Public
Accountants.
Michael J. Gaber, age 37, is Vice President - Acquisitions and a member of the
Acquisition Committee of Associates. Mr. Gaber has been involved in real estate
acquisition, valuation and investment activities since 1989 and has been
associated with Associates since 1997. Prior to joining Associates, he was
involved in the valuation and classification of major assets, restructuring of
debt and analysis of real estate taxes with H.F. Ahmanson & Company, parent of
Home Savings of America. Mr. Gaber graduated from the California State
University, Fullerton in 1991 with a Bachelor of Science degree in Business
Administration - Finance.
Diemmy T. Tran, age 37, is Vice President - Portfolio Management of Associates.
She is responsible for overseeing portfolio management and investor reporting
for all WNC funds, and for monitoring investment returns for all WNC
institutional funds. Ms. Tran has been involved in real estate asset management
and finance activities for 12 years. Prior to joining Associates in 1998, Ms.
Tran served as senior asset manager for a national Tax Credit sponsor and as an
asset specialist for the Resolution Trust Corporation where she was responsible
for the disposition and management of commercial loan and REO portfolios. Ms.
Tran is licensed as a California real estate broker. She graduated from
California State University, Northridge in 1989 with a Bachelor of Science
degree in finance and a minor in real estate.
J. Brad Hurlbut, age 43, is Director of Syndications of Associates. He is
responsible for the financial structuring of WNC's institutional funds. Mr.
Hurlbut has 20 years of experience in real estate investment and development.
Prior to joining WNC in 2000, he served as corporate controller for Great
Western Hotels Corporation. Mr. Hurlbut has been an enrolled agent licensed to
practice before the IRS since 1984. He graduated from the University of Redlands
in 1981 with a Bachelor of Science degree in business management and from
California State University, Fullerton in 1985 with a Master of Science degree
in taxation.
36
Kay L. Cooper, age 66, is a Director of Associates. Mrs. Cooper was the sole
proprietor of Agate 108, a manufacturer and retailer of home accessory products,
from 1975 until its sale in 1998. She is the wife of Wilfred Cooper, Sr. and the
mother of Wilfred Cooper, Jr. Ms. Cooper graduated from the University of
Southern California in 1958 with a Bachelor of Science degree.
(f) Involvement in Certain Legal Proceedings
Inapplicable.
(g) Promoters and Control Persons
Inapplicable.
(h) Audit Committee Financial Expert
Neither the Partnership nor Associates has an audit committee.
Item 11. Executive Compensation
The Partnership has no officers, employees, or directors. However, under the
terms of the Partnership Agreement the Partnership is obligated to the General
Partner or its affiliates for the following fees:
(a) Annual Asset Management Fee. An annual asset management fee in an amount
equal to 0.5% of the Invested Assets of the Partnership, as defined.
"Invested Assets" is defined as the sum of the Partnership's Investment in
Local Limited Partnership Interests and the Partnership's allocable share
of the amount of the mortgage loans on and other debts related to the
Housing Complexes owned by such Local Limited Partnerships. Fees of
$299,028, were incurred during each of the years ended March 31, 2003, 2002
and 2001. The Partnership paid the General Partner or its affiliates,
$30,000, $28,500 and $30,000, of those fees during the years ended March
31, 2003, 2002 and 2001, respectively.
(b) Subordinated Disposition Fee. A subordinated disposition fee in an amount
equal to 1% of the sale price received in connection with the sale or
disposition of an Housing Complex. Subordinated disposition fees will be
subordinated to the prior return of the Limited Partners' capital
contributions and payment of the Preferred Return on investment to the
Limited Partners. "Preferred Return" means an annual, cumulative but not
compounded, "return" to the Limited Partners (including Low Income Housing
Credits) as a class on their adjusted capital contributions commencing for
each Limited Partner on the last day of the calendar quarter during which
the Limited Partner's capital contribution is received by the Partnership,
calculated at the following rates: (i) 16% through December 31, 2002, and
(ii) 6% for the balance of the Partnerships term. No disposition fees have
been paid.
(c) Operating Expenses. The Partnership reimbursed the General Partner or its
affiliates for operating expenses of approximately $30,000, $24,000 and
$23,000 during the years ended March 31, 2003, 2002 and 2001, respectively.
(d) Interest in Partnership. The General Partner receives 1% of the
Partnership's allocated Low Income Housing Credits, which approximated
$24,000 for the General Partner for each of the years ended December 31,
2002, 2001 and 2000. The General Partner is also entitled to receive 1% of
cash distributions. There were no distributions of cash to the General
Partner during the years ended March 31, 2003, 2002 and 2001.
Item 12. Security Ownership of Certain Beneficial Owners and Management and
Related Stockholder Matters
(a) Securities Authorized for Issuance Under Equity Compensation Plans
Inapplicable.
37
(b) Security Ownership of Certain Beneficial Owners
No person is known to own beneficially in excess of 5% of the outstanding
Units.
(c) Security Ownership of Management
Neither the General Partner, its affiliates, nor any of the officers or
directors of the General Partner or its affiliates own directly or
beneficially any Units in the Partnership.
(d) Changes in Control
The management and control of the General Partner may be changed at any
time in accordance with their respective organizational documents, without
the consent or approval of the Limited Partners. In addition, the
Partnership Agreement provides for the admission of one or more additional
and successor General Partners in certain circumstances.
First, with the consent of any other General Partners and a
majority-in-interest of the Limited Partners, any General Partner may
designate one or more persons to be successor or additional General
Partners. In addition, any General Partner may, without the consent of any
other General Partner or the Limited Partners, (I) substitute in its stead
as General Partner any entity which has, by merger, consolidation or
otherwise, acquired substantially all of its assets, stock or other
evidence of equity interest and continued its business, or (ii) cause to be
admitted to the Partnership an additional General Partner or Partners if it
deems such admission to be necessary or desirable so that the Partnership
will be classified a partnership for Federal income tax purposes. Finally,
a majority-in-interest of the Limited Partners may at anytime remove the
General Partner of the Partnership and elect a successor General Partner.
Item 13. Certain Relationships and Related Transactions
The General Partner manages all of the Partnership's affairs. The transactions
with the General Partner are primarily in the form of fees paid by the
Partnership for services rendered to the Partnership, reimbursement of expenses,
and the General Partner's interest in the Partnership, as discussed in Item 11
and in the notes to the Partnership's financial statements.
Item 14. Controls and Procedures
Associates, on behalf of the Partnership, maintains disclosure controls and
procedures that are designed to ensure that information required to be disclosed
in our periodic reports filed with the Securities and Exchange Commission
("SEC") is recorded, processed, summarized and reported within the time periods
specified in the rules and forms of the SEC and that such information is
accumulated and communicated to our management as appropriate to allow timely
decisions regarding required disclosure. In designing and evaluating the
disclosure controls and procedures, our management recognized that any controls
and procedures, no matter how well designed and operated, can provide only
reasonable assurance of achieving the desired control objectives and management
necessarily was required to apply its judgment in evaluating the cost-benefit
relationship of possible controls and procedures.
Based on their most recent evaluation, which was completed within 90 days of the
filing of this Annual Report on Form 10-K, our Principal Executive Officer and
Principal Financial Officer believe that our disclosure controls and procedures
(as defined in Rules 13a-14 and 15d-14 of the Securities Exchange Act of 1934,
as amended) are effective. There were no significant changes in internal
controls or in other factors that could significantly affect these internal
controls subsequent to the date of their most recent evaluation.
38
UNIT IV.
Item 15. Exhibits, Financial Statement Schedules, and Reports on Form 8-K
Financial Statements
(a)(1) Financial statements included in Part II hereof:
Report of Independent Certified Public Accountants
Balance Sheets, March 31, 2003 and 2002
Statements of Operations for the years ended March 31, 2003, 2002 and
2001
Statements of Partners' Equity (Deficit) for the years ended March 31,
2003, 2002 and 2001
Statements of Cash Flows for the years ended March 31, 2003, 2002
and 2001
Notes to Financial Statements
(a)(2) Financial statement schedules included in Part IV hereof:
Report of Independent Certified Public Accountants on Financial Statement
Schedules
Schedule III - Real Estate Owned by Local Limited Partnerships
(b) Reports on Form 8-K.
None
(c) Exhibits.
3.1 Articles of incorporation and by-laws: The registrant is not
incorporated. The Partnership Agreement dated May 10, 1991 is included as
Exhibit B to the Prospectus dated January 2, 1992, filed as Exhibit 28.1
to Form 10 K for the year ended December 31, 1994.
10.1 Second Amended and Restated Agreement and Certificate of Limited
Partnership of Tanglewood Limited Partnership (7) filed as exhibit 10.11
to Post-Effective Amendment No. 9 dated March 31, 1993 is hereby
incorporated herein by reference as exhibit 10.1.
10.2 Amendedand Restated Agreement of Limited Partnership of Windemere
Associates Limited Partnership filed as exhibit 10.12 to Post-Effective
Amendment No. 9 dated March 31, 1993 is hereby incorporated herein by
reference as exhibit 10.2.
10.3 Amended and Restated Agreement of Limited Partnership of Woodland
Apartments, L.P. filed as exhibit 10.13 to Post-Effective Amendment No. 9
dated March 31, 1993 is hereby incorporated herein by reference as
exhibit 10.3.
10.4 Amended and Restated Agreement of Limited Partnership of Meadow Run
Associates Limited Partnership filed as exhibit 10.14 to Post-Effective
Amendment No. 9 dated March 31, 1993 is hereby incorporated herein by
reference as exhibit 10.4.
10.5 Amended and Restated Agreement of Limited Partnership of Candleridge
Apartments of Bondurant L.P. filed as exhibit 10.15 to Post-Effective
Amendment No. 9 dated March 31, 1993 is hereby incorporated herein by
reference as exhibit 10.5.
10.6 Amended and Restated Agreement of Limited Partnership of Candleridge
Apartments of Waukee L.P. filed as exhibit 10.16 to Post-Effective
Amendment No. 9 dated March 31, 1993 is hereby incorporated herein by
reference as exhibit 10.6.
39
10.7 Amended and Restated Agreement and Certification of Limited Partnership
of Fairview Village V, Limited Partnership filed as exhibit 10.17 to
Post-Effective Amendment No. 9 dated March 31, 1993 is hereby
incorporated herein by reference as exhibit 10.7.
10.8 Woodview Limited Partnership Amended and Restated Limited Partnership
Agreement filed as exhibit 10.18 to Post-Effective Amendment No. 9 dated
March 31, 1993 is hereby incorporated herein by reference as exhibit
10.8.
10.9 Amended and Restated Agreement of Limited Partnership of Coffeeville
Housing, Ltd. filed as exhibit 10.19 to Post-Effective Amendment No. 9
dated March 31, 1993 is hereby incorporated herein by reference as
exhibit 10.9.
10.10 Amended and Restated Agreement of Limited Partnership of Crockett Manor
Senior Citizens Complex, Ltd. filed as exhibit 10.20 to Post-Effective
Amendment No. 9 dated March 31, 1993 is hereby incorporated herein by
reference as exhibit 10.10.
10.11 Amended and Restated Agreement and Certificate of Limited Partnership of
Delta Manor, L.P. filed as exhibit 10.21 to Post-Effective Amendment No.
9 dated March 31, 1993 is hereby incorporated herein by reference as
exhibit 10.11.
10.12 Amended and Restated Agreement and Certificate of Limited Partnership of
Eupora Apartments, L.P. filed as exhibit 10.22 to Post-Effective
Amendment No. 9 dated March 31, 1993 is hereby incorporated herein by
reference as exhibit 10.12.
10.13 Amended and Restated Agreement of Limited Partnership of Levelland Manor,
L.P. filed as exhibit 10.23 to Post-Effective Amendment No. 9 dated March
31, 1993 is hereby incorporated herein by reference as exhibit 10.13.
10.14 Third Amendment to the Partnership Agreement of Parks I Limited
Partnership filed as exhibit 10.24 to Post-Effective Amendment No. 9
dated March 31, 1993 is hereby incorporated herein by reference as
exhibit 10.14.
10.15 Second Amendment Village Lane Properties Certificate and Agreement of
Limited Partnership filed as exhibit 10.25 to Post-Effective Amendment
No. 9 dated March 31, 1993 is hereby incorporated herein by reference as
exhibit 10.15.
10.16 Amended and Restated Agreement of Limited Partnership of Gulf Coast
Apartments, L.P. filed as exhibit 10.1 to Form 8-K/A Current Report
Amendment No. 1 dated June 23, 1993 is hereby incorporated herein by
reference as exhibit 10.16.
10.17 Amended and Restated Agreement of Limited Partnership of Gulf Coast
Apartments of Long Beach, L.P. filed as exhibit 10.2 to Form 8-K/A
Current Report Amendment No. 1 dated June 23, 1993 is hereby incorporated
herein by reference as exhibit 10.17.
10.18 Amended and Restated Agreement of Limited Partnership of HOI Limited
Partnership of Benson filed as exhibit 10.3 to Form 8-K/A Current Report
Amendment No. 1 dated June 23, 1993 is hereby incorporated herein by
reference as exhibit 10.18.
10.19 Amended and Restated Agreement of Limited Partnership of HOI Limited
Partnership of Dallas filed as exhibit 10.4 to Form 8-K/A Current Report
Amendment No. 1 dated June 23, 1993 is hereby incorporated herein by
reference as exhibit 10.19.
10.20 Amended and Restated Agreement of Limited Partnership of HOI Limited
Partnership of Dunn filed as exhibit 10.5 to Form 8-K/A Current Report
Amendment No. 1 dated June 23, 1993 is hereby incorporated herein by
reference as exhibit 10.20.
40
10.21 Amended and Restated Agreement of Limited Partnership of HOI Limited
Partnership of Kings Mountain filed as exhibit 10.6 to Form 8-K/A Current
Report Amendment No. 1 dated June 23, 1993 is hereby incorporated herein
by reference as exhibit 10.21.
10.22 Amended and Restated Agreement of Limited Partnership of HOI Limited
Partnership of Lee filed as exhibit 10.7 to Form 8-K/A Current Report
Amendment No. 1 dated June 23, 1993 is hereby incorporated herein by
reference as exhibit 10.22.
10.23 Amended and Restated Agreement of Limited Partnership of HOI Limited
Partnership of Sanford filed as exhibit 10.8 to Form 8-K/A Current Report
Amendment No. 1 dated June 23, 1993 is hereby incorporated herein by
reference as exhibit 10.23.
10.24 Amended and Restated Agreement of Limited Partnership of HOI Limited
Partnership of Selma filed as exhibit 10.9 to Form 8-K/A Current Report
Amendment No. 1 dated June 23, 1993 is hereby incorporated herein by
reference as exhibit 10.24.
10.25 Amended and Restated Agreement of Limited Partnership of Logan Park
Associates Limited Partnership filed as exhibit 10.10 to Form 8-K/A
Current Report Amendment 10.25.
10.26 Agreement of Limited Partnership of Oakdale Senior Housing Limited
Partnership filed as exhibit 10.11 to Form 8-K/A Current Report Amendment
No. 1 dated June 23, 1993 is hereby incorporated herein by reference as
exhibit 10.26.
10.27 Amended and Restated Agreement of Limited Partnership of Clinton Terrace
Apartments, Ltd. filed as exhibit 10.12 to Form 8-K/A Current Report
Amendment No. 2 dated June 23, 1993 is hereby incorporated herein by
reference as exhibit 10.27.
10.28 Amended and Restated Agreement and Certification of Limited Partnership
of Wilcam Housing, Ltd. filed as exhibit 10.38 to Post-Effective
Amendment No. 13 dated October 22, 1993 is hereby incorporated herein by
reference as exhibit 10.28.
10.29 Amended and Restated Agreement and Certificate of Limited Partnership of
Cherokee Housing, Ltd. filed as exhibit 10.39 to Post-Effective Amendment
No. 13 dated October 22, 1993 is hereby incorporated herein by reference
as exhibit 10.29.
10.30 Amended and Restated Agreement of Limited Partnership of Beaumont Elderly
Housing, L.P. filed as exhibit 10.1 to Form 8-K dated January 4, 1994 is
hereby incorporated herein by reference as exhibit 10.30.
10.31 Amended and Restated Agreement of Limited Partnership of Lake Ridge
Apartments, Ltd. filed as exhibit 10.2 to Form 8-K dated January 4, 1994
is hereby incorporated herein by reference as exhibit 10.31.
10.32 Amended and Restated Agreement of Limited Partnership of Orange Beach
Housing, Ltd. filed as exhibit 10. 3 to Form 8-K dated January 4, 1994 is
hereby incorporated herein by reference as exhibit 10.32.
10.33 Amended and Restated Agreement of Limited Partnership of Cambridge Court
Associates Limited Partnership filed as exhibit 10.3 to Form 10-K dated
December 31, 1992 is hereby incorporated herein by reference as exhibit
10.33.
10.34 Amended and Restated Agreement of Limited Partnership of Chester
Associates I, A Limited Partnership filed as exhibit 10.4 to form 10-K
dated December 31, 1992 is hereby incorporated herein by reference as
exhibit 10.34.
10.35 Amended and Restated Agreement of Limited Partnership of Red Bud
Associates I, A Limited Partnership filed as exhibit 10.5 to form 10-K
dated December 31, 1992 is hereby incorporated herein by reference as
exhibit 10.35.
41
10.36 Amended and Restated Agreement of Limited Partnership of Post Manor, L.P.
filed as exhibit 10.6 to form 10-K dated December 31, 1992 is hereby
incorporated herein by reference as exhibit 10.36.
10.37 Amended and Restated Agreement of Limited Partnership of Steeleville
Associates I, a limited Partnership filed as exhibit 10.7 to form 10-K
dated December 31, 1992 is hereby incorporated herein by reference as
exhibit 10.37.
10.38 Amended and Restated Agreement of Limited Partnership of Wills Point
Manor, L.P. filed as exhibit 10.8 to form 10-K dated December 31, 1992 is
hereby incorporated herein by reference as exhibit 10.38.
10.39 Amended and Restated Agreement of Limited Partnership of Killbuck Limited
Partnership filed as exhibit 10.9 to form 10-K dated December 31, 1992 is
hereby incorporated herein by reference as exhibit 10.39.
10.40 Amended and Restated Agreement of Limited Partnership of Coosa Co.
Housing, Ltd. filed as exhibit 10.10 to form 10-K dated December 31, 1992
is hereby incorporated herein by reference as exhibit 10.40.
10.41 Amended and Restated Agreement of Limited Partnership of Ft. Deposit
Housing, Ltd. Filed as exhibit 10.11 to form 10-K dated December 31, 1992
is hereby incorporated herein by reference as exhibit 10.41.
99.1 Certification of the Principal Executive Officer pursuant to 18 U.S.C.
section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley
Act of 2002. (filed herewith)
99.2 Certification of the Principal Financial Officer pursuant to 18 U.S.C.
section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley
Act of 2002. (filed herewith)
99.3 Financial Statements of Whitted Forest Limited Partnership, as of and for
the years ended December 31, 2001 and 2000 together with Independent
Auditors Report thereon; filed as exhibit 99.3 on form 10-K dated March
31, 2002; a significant subsidiary of the Partnership.
99.4 Financial Statements of Whitted Forest Limited Partnership, as of and for
the years ended December 31, 2002 and 2001 together with Independent
Auditors Report thereon; a significant subsidiary of the Partnership.
(filed herewith)
(d) Financial statement schedules follow, as set forth in subsection (a)(2)
hereof.
42
Report of Independent Certified Public Accountants on Financial Statement
Schedules
To the Partners
WNC Housing Tax Credit Fund III, L.P.
The audits referred to in our report dated June 24, 2003, relating to the 2003,
2002 and 2001 financial statements of WNC Housing Tax Credit Fund III, L.P. (the
"Partnership"), which are contained in Item 8 of this Form 10-K, included the
audit of the accompanying financial statement schedules. The financial statement
schedules listed in item 15(a)2, are the responsibility of the Partnership's
management. Our responsibility is to express an opinion on these financial
statement schedules based upon our audits.
In our opinion, such financial statement schedules present fairly, in all
material respects, the financial information set forth therein.
/s/ BDO SEIDMAN, LLP
Costa Mesa, California
June 24, 2003
43
WNC Housing Tax Credit Fund III, L.P.
Schedule III
Real Estate Owned by Local Limited Partnerships
March 31, 2003
------------------------------------ ------------------------------------------------
As of March 31, 2003 As of December 31, 2002
- ------------------------------------------------------------------------------------------------------------------------------------
Partnerships Total Amount of Encumbrances
Original Investment Investment of Local Net
in Local Limited Paid Limited Property and Accumulated Book
Partnership Name Location Partnerships to Date Partnerships Equipment Depreciation Value
- ------------------------------------------------------------------------------------------------------------------------------------
Beaumont
Elderly
Housing, Beaumont,
L.P. Mississippi $ 229,000 $ 229,000 $ 922,000 $ 1,310,000 $ 252,000 $ 1,058,000
Brownfield
Seniors
Community, Brownfield,
Ltd. Texas 147,000 147,000 707,000 841,000 176,000 665,000
Buffalo
Apartments, Buffalo,
Ltd. Texas 91,000 91,000 406,000 600,000 136,000 464,000
Cambridge
Court
Associates
Limited Grottoes,
Partnership Virginia 254,000 254,000 1,311,000 1,652,000 440,000 1,212,000
Candleridge
Apartments of Bondurant,
Bondurant L.P. Iowa 99,000 99,000 590,000 806,000 280,000 526,000
Candleridge
Apartments
of Waukee Waukee,
L.P. Iowa 101,000 101,000 644,000 828,000 263,000 565,000
Carlinville
Associates Carlinville,
I, L.P. Illinois 105,000 105,000 496,000 545,000 143,000 402,000
Cherokee Cedar
Housing, Bluff,
Ltd. Alabama 110,000 110,000 616,000 743,000 207,000 536,000
Chester
Associates
I, a Limited Chester,
Partnership Illinois 159,000 159,000 686,000 1,011,000 359,000 652,000
Clinton
Terrace
Apartments, Albany,
Ltd. Kentucky 138,000 138,000 760,000 931,000 274,000 657,000
Coffeeville
Housing, Coffeeville,
Ltd. Alabama 103,000 103,000 538,000 663,000 198,000 465,000
Coosa
County
Housing, Rockford,
Ltd. Alabama 103,000 103,000 554,000 690,000 202,000 488,000
44
WNC Housing Tax Credit Fund III, L.P.
Schedule III
Real Estate Owned by Local Limited Partnerships
March 31, 2003
------------------------------------ ------------------------------------------------
As of March 31, 2003 As of December 31, 2002
- ------------------------------------------------------------------------------------------------------------------------------------
Partnerships Total Amount of Encumbrances
Original Investment Investment of Local Net
in Local Limited Paid Limited Property and Accumulated Book
Partnership Name Location Partnerships to Date Partnerships Equipment Depreciation Value
- ------------------------------------------------------------------------------------------------------------------------------------
Crockett Crockett,
Manor, Ltd. Texas 184,000 184,000 880,000 1,184,000 274,000 910,000
Crockett
Manor
Senior
Citizens Crockett,
Complex, Ltd. Texas 203,000 203,000 1,012,000 1,350,000 262,000 1,088,000
Delta Techula,
Manor, L.P. Mississippi 227,000 227,000 1,225,000 1,553,000 584,000 969,000
Eupora Eupora,
Apartments, L.P. Mississippi 138,000 138,000 1,194,000 1,421,000 370,000 1,051,000
Fairview
Village V,
Limited Carroll,
Partnership Iowa 119,000 119,000 584,000 785,000 232,000 553,000
Fox Lake
Manor
Limited Fox Lake,
Partnership Wisconsin
84,000 84,000 369,000 394,000 167,000 227,000
Ft. Deposit Fort Deposit,
Housing, Ltd. Alabama 127,000 127,000 698,000 865,000 256,000 609,000
Gulf Coast Gulfport,
Apartments, L.P. Mississippi 320,000 320,000 1,409,000 1,889,000 670,000 1,219,000
Gulf Coast
Apartments
of Long Long Beach,
Beach, L.P. Mississippi 315,000 315,000 1,425,000 1,911,000 668,000 1,243,000
Heritage
Colonial Blackshear,
Homes, L.P. Georgia 115,000 115,000 521,000 752,000 186,000 566,000
HOI Limited Benson,
Partnership North
of Benson Carolina 269,000 269,000 1,162,000 1,700,000 464,000 1,236,000
HOI Limited Dallas,
Partnership North
of Dallas Carolina 366,000 366,000 1,681,000 2,293,000 667,000 1,626,000
45
WNC Housing Tax Credit Fund III, L.P.
Schedule III
Real Estate Owned by Local Limited Partnerships
March 31, 2003
------------------------------------ ------------------------------------------------
As of March 31, 2003 As of December 31, 2002
- ------------------------------------------------------------------------------------------------------------------------------------
Partnerships Total Amount of Encumbrances
Original Investment Investment of Local Net
in Local Limited Paid Limited Property and Accumulated Book
Partnership Name Location Partnerships to Date Partnerships Equipment Depreciation Value
- ------------------------------------------------------------------------------------------------------------------------------------
HOI Limited Dunn,
Partnership North
of Dunn Carolina 170,000 170,000 809,000 1,101,000 328,000 773,000
HOI Limited Kings
Partnership Mountain,
of Kings Mt. North Carolina 262,000 262,000 1,213,000 1,648,000 476,000 1,172,000
HOI Limited Sanford,
Partnership North
of Lee Carolina 419,000 419,000 1,952,000 2,646,000 710,000 1,936,000
HOI Limited Sanford,
Partnership North
of Sanford Carolina 277,000 277,000 1,213,000 1,751,000 474,000 1,277,000
HOI Limited Selma,
Partnership North
of Selma Carolina 271,000 271,000 1,169,000 1,765,000 514,000 1,251,000
Killbuck
Limited Killbuck,
Partnership Ohio 151,000 151,000 743,000 936,000 349,000 587,000
Lake Ridge Tiptonville,
Apartments, L.P. Tennessee 317,000 317,000 1,450,000 1,835,000 603,000 1,232,000
Levelland Levelland,
Manor, L.P. Texas 175,000 175,000 898,000 1,125,000 269,000 856,000
Logan Park
Associates
Limited Caldwell,
Partnership Idaho 571,000 571,000 2,259,000 3,022,000 918,000 2,104,000
Meadow Run
Associates
Limited Gordonsville,
Partnership Virginia 302,000 302,000 1,483,000 1,856,000 425,000 1,431,000
Oakdale Senior
Housing
Limited Oakdale,
Partnership California 919,000 919,000 2,900,000 4,669,000 1,347,000 3,322,000
46
WNC Housing Tax Credit Fund III, L.P.
Schedule III
Real Estate Owned by Local Limited Partnerships
March 31, 2003
------------------------------------ ------------------------------------------------
As of March 31, 2003 As of December 31, 2002
- ------------------------------------------------------------------------------------------------------------------------------------
Partnerships Total Amount of Encumbrances
Original Investment Investment of Local Net
in Local Limited Paid Limited Property and Accumulated Book
Partnership Name Location Partnerships to Date Partnerships Equipment Depreciation Value
- ------------------------------------------------------------------------------------------------------------------------------------
Orange Beach Orange Beach,
Housing, Ltd. Alabama 208,000 208,000 1,080,000 1,362,000 324,000 1,038,000
Parks I
Limited Chatham,
Partnership Virginia 253,000 253,000 1,232,000 1,586,000 438,000 1,148,000
Post Manor, L.P. Post, Texas 122,000 122,000 627,000 734,000 174,000 561,000
Red Bud
Associates I,
a Limited Red Bud,
Partnership Illinois 135,000 135,000 594,000 939,000 311,000 628,000
Steeleville
Associates
I, a Limited Steeleville,
Partnership Illinois 110,000 110,000 546,000 735,000 253,000 481,000
Tanglewood
Limited Frankfurt,
Partnership Ohio 212,000 212,000 1,058,000 1,326,000 498,000 828,000
Village
Lane
Properties, a
Limited Farmington,
Partnership Arkansas 168,000 168,000 879,000 984,000 352,000 632,000
Whitted
Forest Hillsborough,
Limited North
Partnership Carolina 685,000 685,000 973,000 2,028,000 392,000 1,636,000
Wilcam Camden,
Housing, Ltd. Alabama 106,000 106,000 616,000 762,000 205,000 557,000
Wills Point Wills Point,
Manor, L.P. Texas 124,000 124,000 624,000 766,000 184,000 582,000
Windmere
Associates
Limited Lexington,
Partnership Virginia 291,000 291,000 1,476,000 1,839,000 403,000 1,436,000
Woodlands Mount
Apartments, Pleasant,
L.P. Texas 239,000 239,000 1,243,000 1,530,000 367,000 1,163,000
47
WNC Housing Tax Credit Fund III, L.P.
Schedule III
Real Estate Owned by Local Limited Partnerships
March 31, 2003
------------------------------------ ------------------------------------------------
As of March 31, 2003 As of December 31, 2002
- ------------------------------------------------------------------------------------------------------------------------------------
Partnerships Total Amount of Encumbrances
Original Investment Investment of Local Net
in Local Limited Paid Limited Property and Accumulated Book
Partnership Name Location Partnerships to Date Partnerships Equipment Depreciation Value
- ------------------------------------------------------------------------------------------------------------------------------------
Chillicothe,
Woodview Illinois and
Limited Glassford,
Partnership Illinois 269,000 269,000 1,187,000 1,616,000 459,000 1,157,000
-------------- ------------- -------------- ------------- ------------ ------------
$ 10,862,000 $ 10,862,000 $ 48,614,000 $ 65,278,000 $ 18,503,000 $ 46,775,000
============== ============= ============== ============= ============ ============
48
WNC Housing Tax Credit Fund III, L.P.
Schedule III
Real Estate Owned by Local Limited Partnerships
March 31, 2003
------------------------------------------------------------------------------
For the year ended December 31, 2002
------------------------------------------------------------------------------
Rental Net Year Investment Status Estimated Useful
Partnership Name Income Income/(loss) Acquired Life (Years)
- --------------------------------------------------------------------------------------------------------------------
Beaumont Elderly Housing, L.P. $ 104,000 $ (21,000) 1995 Completed 45
Brownfield Seniors Community, Ltd. 117,000 (26,000) 1994 Completed 40
Buffalo Apartments, Ltd. 93,000 (3,000) 1995 Completed 35
Cambridge Court Associates Limited
Partnership 138,000 (44,000) 1992 Completed 35
Candleridge Apartments of Bondurant
L.P. 127,000 (14,000) 1992 Completed 27.5
Candleridge Apartments of Waukee L.P. 137,000 (8,000) 1992 Completed 27.5
Carlinville Associates I, L.P. 65,000 - 1994 Completed 30
Cherokee Housing, Ltd. 75,000 (14,000) 1993 Completed 40
Chester Associates I, a Limited
Partnership 89,000 (6,000) 1992 Completed 27.5
Clinton Terrace Apartments, Ltd. 83,000 (8,000) 1993 Completed 40
Coffeeville Housing, Ltd. 41,000 (25,000) 1993 Completed 40
Coosa County Housing, Ltd. 67,000 (7,000) 1992 Completed 40
Crockett Manor, Ltd. 156,000 (14,000) 1994 Completed 40
Crockett Manor Senior Citizens
Complex, Ltd. 142,000 1,000 1993 Completed 50
Delta Manor, L.P. 154,000 (45,000) 1993 Completed 27.5
Eupora Apartments, L.P. 131,000 (15,000) 1992 Completed 40
Fairview Village V, Limited
Partnership 71,000 (14,000) 1992 Completed 40
Fox Lake Manor Limited Partnership 27,000 (12,000) 1994 Completed 27.5
Ft. Deposit Housing, Ltd. 83,000 (12,000) 1992 Completed 40
Gulf Coast Apartments, L.P. 226,000 (17,000) 1993 Completed 30
49
WNC Housing Tax Credit Fund III, L.P.
Schedule III
Real Estate Owned by Local Limited Partnerships
March 31, 2003
------------------------------------------------------------------------------
For the year ended December 31, 2002
------------------------------------------------------------------------------
Rental Net Year Investment Status Estimated Useful
Partnership Name Income Income/(loss) Acquired Life (Years)
- --------------------------------------------------------------------------------------------------------------------
Gulf Coast Apartments of Long Beach,
L.P. 229,000 (19,000) 1993 Completed 30
Heritage Colonial Homes, L.P. 69,000 (19,000) 1994 Completed 40
HOI Limited Partnership of Benson 208,000 (24,000) 1993 Completed 40
HOI Limited Partnership of Dallas 234,000 (66,000) 1993 Completed 40
HOI Limited Partnership of Dunn 124,000 (51,000) 1993 Completed 40
HOI Limited Partnership of Kings Mt. 162,000 (23,000) 1993 Completed 40
HOI Limited Partnership of Lee 318,000 (63,000) 1993 Completed 40
HOI Limited Partnership of Sanford 240,000 (27,000) 1993 Completed 40
HOI Limited Partnership of Selma 248,000 (10,000) 1993 Completed 40
Killbuck Limited Partnership 82,000 (22,000) 1992 Completed 27.5
Lake Ridge Apartments, L.P. 149,000 (54,000) 1994 Completed 50
Levelland Manor, L.P. 127,000 (25,000) 1993 Completed 40
Logan Park Associates Limited
Partnership 421,000 (26,000) 1993 Completed 27.5
Meadow Run Associates Limited
Partnership 168,000 (60,000) 1992 Completed 35
Oakdale Senior Housing Limited
Partnership 353,000 (237,000) 1993 Completed 30
Orange Beach Housing, Ltd. 116,000 (25,000) 1994 Completed 40
Parks I Limited Partnership 210,000 (24,000) 1993 Completed 40
Post Manor, L.P. 75,000 (23,000) 1992 Completed 40
Red Bud Associates I, a Limited
Partnership 67,000 (16,000) 1992 Completed 27.5
Steeleville Associates I, a Limited
Partnership 56,000 (15,000) 1992 Completed 27.5
Tanglewood Limited Partnership 115,000 (22,000) 1992 Completed 27.5
50
WNC Housing Tax Credit Fund III, L.P.
Schedule III
Real Estate Owned by Local Limited Partnerships
March 31, 2003
------------------------------------------------------------------------------
For the year ended December 31, 2002
------------------------------------------------------------------------------
Rental Net Year Investment Status Estimated Useful
Partnership Name Income Income/(loss) Acquired Life (Years)
- --------------------------------------------------------------------------------------------------------------------
Village Lane Properties, a Limited
Partnership 173,000 (21,000) 1993 Completed 25
Whitted Forest Limited Partnership 181,000 (29,000) 1993 Completed 40
Wilcam Housing, Ltd. 74,000 (13,000) 1993 Completed 40
Wills Point Manor, L.P. 85,000 (24,000) 1992 Completed 40
Windmere Associates Limited
Partnership 173,000 (38,000) 1992 Completed 35
Woodlands Apartments, L.P. 162,000 (44,000) 1992 Completed 40
Woodview Limited Partnership 161,000 (27,000) 1992 Completed 40
---------- ------------
$6,906,000 $(1,351,000)
========== ============
51
WNC Housing Tax Credit Fund III, L.P.
Schedule III
Real Estate Owned by Local Limited Partnerships
March 31, 2002
------------------------------------ ------------------------------------------------
As of March 31, 2002 As of December 31, 2001
- ------------------------------------------------------------------------------------------------------------------------------------
Partnerships Total Amount of Encumbrances
Original Investment Investment of Local Net
in Local Limited Paid Limited Property and Accumulated Book
Partnership Name Location Partnerships to Date Partnerships Equipment Depreciation Value
- ------------------------------------------------------------------------------------------------------------------------------------
Beaumont
Elderly
Housing, Beaumont,
L.P. Mississippi $ 229,000 $ 229,000 $ 925,000 $ 1,291,000 $ 219,000 $ 1,072,000
Brownfield
Seniors
Community, Brownfield,
Ltd. Texas 147,000 147,000 685,000 840,000 155,000 685,000
Buffalo
Apartments, Buffalo,
Ltd. Texas 91,000 91,000 408,000 589,000 116,000 473,000
Cambridge
Court
Associates
Limited Grottoes,
Partnership Virginia 254,000 254,000 1,317,000 1,653,000 394,000 1,259,000
Candleridge
Apartments of Bondurant,
Bondurant L.P. Iowa 99,000 99,000 594,000 787,000 244,000 543,000
Candleridge
Apartments
of Waukee Waukee,
L.P. Iowa 101,000 101,000 648,000 821,000 231,000 590,000
Carlinville
Associates Carlinville,
I, L.P. Illinois 105,000 105,000 499,000 537,000 129,000 408,000
Cherokee Cedar
Housing, Bluff,
Ltd. Alabama 110,000 110,000 618,000 738,000 187,000 551,000
Chester
Associates
I, a Limited Chester,
Partnership Illinois 159,000 159,000 688,000 1,005,000 323,000 682,000
Clinton
Terrace
Apartments, Albany,
Ltd. Kentucky 138,000 138,000 764,000 930,000 251,000 679,000
Coffeeville
Housing, Coffeeville,
Ltd. Alabama 103,000 103,000 541,000 663,000 180,000 483,000
Coosa
County
Housing, Rockford,
Ltd. Alabama 103,000 103,000 557,000 688,000 184,000 504,000
52
WNC Housing Tax Credit Fund III, L.P.
Schedule III
Real Estate Owned by Local Limited Partnerships
March 31, 2002
------------------------------------ ------------------------------------------------
As of March 31, 2002 As of December 31, 2001
- ------------------------------------------------------------------------------------------------------------------------------------
Partnerships Total Amount of Encumbrances
Original Investment Investment of Local Net
in Local Limited Paid Limited Property and Accumulated Book
Partnership Name Location Partnerships to Date Partnerships Equipment Depreciation Value
- ------------------------------------------------------------------------------------------------------------------------------------
Crockett Crockett,
Manor, Ltd. Texas 184,000 184,000 887,000 1,162,000 245,000 917,000
Crockett
Manor
Senior
Citizens Crockett,
Complex, Ltd. Texas 203,000 203,000 1,016,000 1,323,000 234,000 1,089,000
Delta Techula,
Manor, L.P. Mississippi 227,000 227,000 1,229,000 1,553,000 528,000 1,025,000
Eupora Eupora,
Apartments, L.P. Mississippi 138,000 138,000 1,198,000 1,422,000 336,000 1,086,000
Fairview
Village V,
Limited Carroll,
Partnership Iowa 119,000 119,000 588,000 783,000 208,000 575,000
Fox Lake
Manor
Limited Fox Lake,
Partnership Wisconsin 84,000 84,000 371,000 480,000 153,000 327,000
Ft. Deposit Fort Deposit,
Housing, Ltd. Alabama 127,000 127,000 700,000 865,000 233,000 632,000
Gulf Coast Gulfport,
Apartments, L.P. Mississippi 320,000 320,000 1,421,000 1,862,000 621,000 1,241,000
Gulf Coast
Apartments
of Long Long Beach,
Beach, L.P. Mississippi 315,000 315,000 1,435,000 1,881,000 618,000 1,263,000
Heritage
Colonial Blackshear,
Homes, L.P. Georgia 115,000 115,000 523,000 752,000 168,000 584,000
HOI Limited Benson,
Partnership North
of Benson Carolina 269,000 269,000 1,182,000 1,690,000 416,000 1,274,000
HOI Limited Dallas,
Partnership North
of Dallas Carolina 366,000 366,000 1,692,000 2,270,000 609,000 1,661,000
53
WNC Housing Tax Credit Fund III, L.P.
Schedule III
Real Estate Owned by Local Limited Partnerships
March 31, 2002
------------------------------------ ------------------------------------------------
As of March 31, 2002 As of December 31, 2001
- ------------------------------------------------------------------------------------------------------------------------------------
Partnerships Total Amount of Encumbrances
Original Investment Investment of Local Net
in Local Limited Paid Limited Property and Accumulated Book
Partnership Name Location Partnerships to Date Partnerships Equipment Depreciation Value
- ------------------------------------------------------------------------------------------------------------------------------------
HOI Limited Dunn,
Partnership North
of Dunn Carolina 170,000 170,000 815,000 1,090,000 297,000 793,000
HOI Limited Kings
Partnership Mountain,
of Kings Mt. North Carolina 262,000 262,000 1,222,000 1,638,000 428,000 1,210,000
HOI Limited Sanford,
Partnership North
of Lee Carolina 419,000 419,000 1,968,000 2,642,000 642,000 2,000,000
HOI Limited Sanford,
Partnership North
of Sanford Carolina 277,000 277,000 1,233,000 1,740,000 426,000 1,314,000
HOI Limited Selma,
Partnership North
of Selma Carolina 271,000 271,000 1,192,000 1,756,000 462,000 1,294,000
Killbuck
Limited Killbuck,
Partnership Ohio 151,000 151,000 746,000 936,000 317,000 619,000
Lake Ridge Tiptonville,
Apartments, L.P. Tennessee 317,000 317,000 1,455,000 1,835,000 545,000 1,290,000
Levelland Levelland,
Manor, L.P. Texas 175,000 175,000 901,000 1,125,000 242,000 883,000
Logan Park
Associates
Limited Caldwell,
Partnership Idaho 571,000 571,000 2,267,000 3,022,000 851,000 2,171,000
Meadow Run
Associates
Limited Gordonsville,
Partnership Virginia 302,000 302,000 1,486,000 1,856,000 374,000 1,482,000
Oakdale Senior
Housing
Limited Oakdale,
Partnership California 919,000 919,000 2,951,000 4,669,000 1,204,000 3,465,000
54
WNC Housing Tax Credit Fund III, L.P.
Schedule III
Real Estate Owned by Local Limited Partnerships
March 31, 2002
------------------------------------ ------------------------------------------------
As of March 31, 2002 As of December 31, 2001
- ------------------------------------------------------------------------------------------------------------------------------------
Partnerships Total Amount of Encumbrances
Original Investment Investment of Local Net
in Local Limited Paid Limited Property and Accumulated Book
Partnership Name Location Partnerships to Date Partnerships Equipment Depreciation Value
- ------------------------------------------------------------------------------------------------------------------------------------
Orange Beach Orange Beach,
Housing, Ltd. Alabama 208,000 208,000 1,085,000 1,359,000 285,000 1,074,000
Parks I
Limited Chatham,
Partnership Virginia 253,000 253,000 1,237,000 1,586,000 399,000 1,187,000
Post Manor, L.P. Post, Texas 122,000 122,000 629,000 734,000 156,000 578,000
Red Bud
Associates I,
a Limited Red Bud,
Partnership Illinois 135,000 135,000 597,000 931,000 278,000 653,000
Steeleville
Associates
I, a Limited Steeleville,
Partnership Illinois 110,000 110,000 536,000 732,000 228,000 504,000
Tanglewood
Limited Frankfurt,
Partnership Ohio 212,000 212,000 1,061,000 1,326,000 452,000 874,000
Village
Lane
Properties, a
Limited Farmington,
Partnership Arkansas 168,000 168,000 883,000 984,000 319,000 665,000
Whitted
Forest Hillsborough,
Limited North
Partnership Carolina 685,000 685,000 993,000 2,028,000 343,000 1,685,000
Wilcam Camden,
Housing, Ltd. Alabama 106,000 106,000 619,000 761,000 184,000 577,000
Wills Point Wills Point,
Manor, L.P. Texas 124,000 124,000 626,000 766,000 166,000 600,000
Windmere
Associates
Limited Lexington,
Partnership Virginia 291,000 291,000 1,480,000 1,838,000 354,000 1,484,000
55
WNC Housing Tax Credit Fund III, L.P.
Schedule III
Real Estate Owned by Local Limited Partnerships
March 31, 2002
------------------------------------ ------------------------------------------------
As of March 31, 2002 As of December 31, 2001
- ------------------------------------------------------------------------------------------------------------------------------------
Partnerships Total Amount of Encumbrances
Original Investment Investment of Local Net
in Local Limited Paid Limited Property and Accumulated Book
Partnership Name Location Partnerships to Date Partnerships Equipment Depreciation Value
- ------------------------------------------------------------------------------------------------------------------------------------
Woodlands Mount
Apartments, Pleasant,
L.P. Texas 239,000 239,000 1,248,000 1,530,000 329,000 1,201,000
Chillicothe,
Woodview Illinois and
Limited Glassford,
Partnership Illinois 269,000 269,000 1,191,000 1,596,000 405,000 1,191,000
-------------- ------------- -------------- ------------- ------------ ------------
$ 10,862,000 $ 10,862,000 $ 48,907,000 $ 65,065,000 $ 16,668,000 $ 48,397,000
============== ============= ============== ============= ============ ============
56
WNC Housing Tax Credit Fund III, L.P.
Schedule III
Real Estate Owned by Local Limited Partnerships
March 31, 2002
------------------------------------------------------------------------------
For the year ended December 31, 2001
------------------------------------------------------------------------------
Rental Net Year Investment Status Estimated Useful
Partnership Name Income Income/(loss) Acquired Life (Years)
- --------------------------------------------------------------------------------------------------------------------
Beaumont Elderly Housing, L.P. $ 103,000 $ (14,000) 1995 Completed 45
Brownfield Seniors Community, Ltd. 88,000 (24,000) 1994 Completed 40
Buffalo Apartments, Ltd. 88,000 (14,000) 1995 Completed 35
Cambridge Court Associates Limited
Partnership 140,000 (45,000) 1992 Completed 35
Candleridge Apartments of Bondurant
L.P. 123,000 (14,000) 1992 Completed 27.5
Candleridge Apartments of Waukee L.P. 134,000 (3,000) 1992 Completed 27.5
Carlinville Associates I, L.P. 80,000 (9,000) 1994 Completed 30
Cherokee Housing, Ltd. 71,000 (6,000) 1993 Completed 40
Chester Associates I, a Limited
Partnership 123,000 (25,000) 1992 Completed 27.5
Clinton Terrace Apartments, Ltd. 76,000 (14,000) 1993 Completed 40
Coffeeville Housing, Ltd. 51,000 (19,000) 1993 Completed 40
Coosa County Housing, Ltd. 62,000 (6,000) 1992 Completed 40
Crockett Manor, Ltd. 146,000 (11,000) 1994 Completed 40
Crockett Manor Senior Citizens
Complex, Ltd. 125,000 4,000 1993 Completed 50
Delta Manor, L.P. 154,000 (33,000) 1993 Completed 27.5
Eupora Apartments, L.P. 121,000 (9,000) 1992 Completed 40
Fairview Village V, Limited
Partnership 71,000 (14,000) 1992 Completed 40
Fox Lake Manor Limited Partnership 29,000 (21,000) 1994 Completed 27.5
Ft. Deposit Housing, Ltd. 85,000 (9,000) 1992 Completed 40
Gulf Coast Apartments, L.P. 199,000 (33,000) 1993 Completed 30
57
WNC Housing Tax Credit Fund III, L.P.
Schedule III
Real Estate Owned by Local Limited Partnerships
March 31, 2002
------------------------------------------------------------------------------
For the year ended December 31, 2001
------------------------------------------------------------------------------
Rental Net Year Investment Status Estimated Useful
Partnership Name Income Income/(loss) Acquired Life (Years)
- --------------------------------------------------------------------------------------------------------------------
Gulf Coast Apartments of Long Beach,
L.P. 226,000 (27,000) 1993 Completed 30
Heritage Colonial Homes, L.P. 70,000 (15,000) 1994 Completed 40
HOI Limited Partnership of Benson 197,000 (18,000) 1993 Completed 40
HOI Limited Partnership of Dallas 233,000 (56,000) 1993 Completed 40
HOI Limited Partnership of Dunn 116,000 (28,000) 1993 Completed 40
HOI Limited Partnership of Kings Mt. 162,000 (23,000) 1993 Completed 40
HOI Limited Partnership of Lee 296,000 (48,000) 1993 Completed 40
HOI Limited Partnership of Sanford 208,000 (87,000) 1993 Completed 40
HOI Limited Partnership of Selma 221,000 (34,000) 1993 Completed 40
Killbuck Limited Partnership 82,000 (22,000) 1992 Completed 27.5
Lake Ridge Apartments, L.P. 146,000 (53,000) 1994 Completed 50
Levelland Manor, L.P. 122,000 (14,000) 1993 Completed 40
Logan Park Associates Limited
Partnership 420,000 (31,000) 1993 Completed 27.5
Meadow Run Associates Limited
Partnership 163,000 (33,000) 1992 Completed 35
Oakdale Senior Housing Limited
Partnership 340,000 (222,000) 1993 Completed 30
Orange Beach Housing, Ltd. 110,000 (31,000) 1994 Completed 40
Parks I Limited Partnership 208,000 (34,000) 1993 Completed 40
Post Manor, L.P. 77,000 (19,000) 1992 Completed 40
Red Bud Associates I, a Limited
Partnership 90,000 (27,000) 1992 Completed 27.5
Steeleville Associates I, a Limited
Partnership 86,000 (15,000) 1992 Completed 27.5
Tanglewood Limited Partnership 114,000 (21,000) 1992 Completed 27.5
58
WNC Housing Tax Credit Fund III, L.P.
Schedule III
Real Estate Owned by Local Limited Partnerships
March 31, 2002
------------------------------------------------------------------------------
For the year ended December 31, 2001
------------------------------------------------------------------------------
Partnership Name Rental Net Year Investment Status Estimated Useful
Income Income/(loss) Acquired Life (Years)
- --------------------------------------------------------------------------------------------------------------------
Village Lane Properties, a Limited
Partnership 173,000 (23,000) 1993 Completed 25
Whitted Forest Limited Partnership 189,000 (25,000) 1993 Completed 40
Wilcam Housing, Ltd. 66,000 (21,000) 1993 Completed 40
Wills Point Manor, L.P. 83,000 (11,000) 1992 Completed 40
Windmere Associates Limited
Partnership 172,000 (32,000) 1992 Completed 35
Woodlands Apartments, L.P. 162,000 (29,000) 1992 Completed 40
Woodview Limited Partnership 155,000 (19,000) 1992 Completed 40
------------ ------------
$ 6,756,000 $(1,337,000)
============ ============
59
WNC Housing Tax Credit Fund III, L.P.
Schedule III
Real Estate Owned by Local Limited Partnerships
March 31, 2001
------------------------------------ ------------------------------------------------
As of March 31, 2001 As of December 31, 2000
- ------------------------------------------------------------------------------------------------------------------------------------
Partnerships Total Amount of Encumbrances
Original Investment Investment of Local Net
in Local Limited Paid Limited Property and Accumulated Book
Partnership Name Location Partnerships to Date Partnerships Equipment Depreciation Value
- ------------------------------------------------------------------------------------------------------------------------------------
Beaumont
Elderly
Housing, Beaumont,
L.P. Mississippi $ 229,000 $ 229,000 $ 927,000 $ 1,288,000 $ 187,000 $ 1,101,000
Brownfield
Seniors
Community, Brownfield,
Ltd. Texas 147,000 147,000 687,000 838,000 135,000 703,000
Buffalo
Apartments, Buffalo,
Ltd. Texas 91,000 91,000 412,000 558,000 99,000 459,000
Cambridge
Court
Associates
Limited Grottoes,
Partnership Virginia 254,000 254,000 1,323,000 1,652,000 347
,000 1,305,000
Candleridge
Apartments of Bondurant,
Bondurant L.P. Iowa 99,000 99,000 598,000 780,000 213,000 567,000
Candleridge
Apartments
of Waukee Waukee,
L.P. Iowa 101,000 101,000 652,000 813,000 202,000 611,000
Carlinville
Associates Carlinville,
I, L.P. Illinois 105,000 105,000 501,000 537,000 115,000 422,000
Cherokee Cedar
Housing, Bluff,
Ltd. Alabama 110,000 110,000 620,000 738,000 168,000 570,000
Chester
Associates
I, a Limited Chester,
Partnership Illinois 159,000 159,000 691,000 1,000,000 289,000 711,000
Clinton
Terrace
Apartments, Albany,
Ltd. Kentucky 138,000 138,000 767,000 930,000 229,000 701,000
Coffeeville
Housing, Coffeeville,
Ltd. Alabama 103,000 103,000 543,000 660,000 160,000 500,000
Coosa
County
Housing, Rockford,
Ltd. Alabama 103,000 103,000 560,000 688,000 167,000 521,000
60
WNC Housing Tax Credit Fund III, L.P.
Schedule III
Real Estate Owned by Local Limited Partnerships
March 31, 2001
------------------------------------ ------------------------------------------------
As of March 31, 2001 As of December 31, 2000
- ------------------------------------------------------------------------------------------------------------------------------------
Partnerships Total Amount of Encumbrances
Original Investment Investment of Local Net
in Local Limited Paid Limited Property and Accumulated Book
Partnership Name Location Partnerships to Date Partnerships Equipment Depreciation Value
- ------------------------------------------------------------------------------------------------------------------------------------
Crockett Crockett,
Manor, Ltd. Texas 184,000 184,000 893,000 1,159,000 216,000 943,000
Crockett
Manor
Senior
Citizens Crockett,
Complex, Ltd. Texas 203,000 203,000 1,020,000 1,313,000 207,000 1,106,000
Delta Techula,
Manor, L.P. Mississippi 227,000 227,000 1,232,000 1,549,000 473,000 1,076,000
Eupora Eupora,
Apartments, L.P. Mississippi 138,000 138,000 1,202,000 1,422,000 302,000 1,120,000
Fairview
Village V,
Limited Carroll,
Partnership Iowa 119,000 119,000 591,000 776,000 184,000 592,000
Fox Lake
Manor
Limited Fox Lake,
Partnership Wisconsin 84,000 84,000 373,000 480,000 136,000 344,000
Ft. Deposit Fort Deposit,
Housing, Ltd. Alabama 127,000 127,000 702,000 864,000 209,000 655,000
Gulf Coast Gulfport,
Apartments, L.P. Mississippi 320,000 320,000 1,432,000 1,848,000 556,000 1,292,000
Gulf Coast
Apartments
of Long Long Beach,
Beach, L.P. Mississippi 315,000 315,000 1,445,000 1,871,000 550,000 1,321,000
Heritage
Colonial Blackshear,
Homes, L.P. Georgia 125,000 115,000 525,000 752,000 149,000 603,000
HOI Limited Benson,
Partnership North
of Benson Carolina 269,000 269,000 1,200,000 1,689,000 369,000 1,320,000
HOI Limited Dallas,
Partnership North
of Dallas Carolina 366,000 366,000 1,702,000 2,270,000 542,000 1,728,000
61
WNC Housing Tax Credit Fund III, L.P.
Schedule III
Real Estate Owned by Local Limited Partnerships
March 31, 2001
------------------------------------ ------------------------------------------------
As of March 31, 2001 As of December 31, 2000
- ------------------------------------------------------------------------------------------------------------------------------------
Partnerships Total Amount of Encumbrances
Original Investment Investment of Local Net
in Local Limited Paid Limited Property and Accumulated Book
Partnership Name Location Partnerships to Date Partnerships Equipment Depreciation Value
- ------------------------------------------------------------------------------------------------------------------------------------
HOI Limited Dunn,
Partnership North
of Dunn Carolina 170,000 170,000 820,000 1,090,000 262,000 828,000
HOI Limited Kings
Partnership Mountain,
of Kings Mt. North Carolina 262,000 262,000 1,230,000 1,637,000 380,000 1,257,000
HOI Limited Sanford,
Partnership North
of Lee Carolina 419,000 419,000 1,982,000 2,640,000 570,000 2,070,000
HOI Limited Sanford,
Partnership North
of Sanford Carolina 277,000 277,000 1,251,000 1,740,000 378,000 1,362,000
HOI Limited Selma,
Partnership North
of Selma Carolina 271,000 271,000 1,213,000 1,756,000 409,000 1,347,000
Killbuck
Limited Killbuck,
Partnership Ohio 151,000 151,000 432,000 671,000 343,000 328,000
Lake Ridge Tiptonville,
Apartments, L.P. Tennessee 317,000 317,000 1,460,000 1,835,000 484,000 1,351,000
Levelland Levelland,
Manor, L.P. Texas 175,000 175,000 904,000 1,125,000 213,000 912,000
Logan Park
Associates
Limited Caldwell,
Partnership Idaho 571,000 571,000 2,274,000 3,022,000 784,000 2,238,000
Meadow Run
Associates
Limited Gordonsville,
Partnership Virginia 302,000 302,000 1,490,000 1,856,000 323,000 1,533,000
Oakdale Senior
Housing
Limited Oakdale,
Partnership California 919,000 919,000 2,999,000 4,671,000 1,060,000 3,611,000
62
WNC Housing Tax Credit Fund III, L.P.
Schedule III
Real Estate Owned by Local Limited Partnerships
March 31, 2001
------------------------------------ ------------------------------------------------
As of March 31, 2001 As of December 31, 2000
- ------------------------------------------------------------------------------------------------------------------------------------
Partnerships Total Amount of Encumbrances
Original Investment Investment of Local Net
in Local Limited Paid Limited Property and Accumulated Book
Partnership Name Location Partnerships to Date Partnerships Equipment Depreciation Value
- ------------------------------------------------------------------------------------------------------------------------------------
Orange Beach Orange Beach,
Housing, Ltd. Alabama 229,000 208,000 1,089,000 1,357,000 245,000 1,112,000
Parks I
Limited Chatham,
Partnership Virginia 253,000 253,000 1,242,000 1,583,000 359,000 1,224,000
Post Manor, L.P. Post, Texas 117,000 117,000 601,000 734,000 138,000 596,000
Red Bud
Associates I,
a Limited Red Bud,
Partnership Illinois 135,000 135,000 599,000 931,000 246,000 685,000
Steeleville
Associates
I, a Limited Steeleville,
Partnership Illinois 110,000 110,000 538,000 727,000 203,000 524,000
Tanglewood
Limited Frankfurt,
Partnership Ohio 212,000 212,000 1,065,000 1,322,000 406,000 916,000
Village
Lane
Properties, a
Limited Farmington,
Partnership Arkansas 168,000 168,000 886,000 984,000 285,000 699,000
Whitted
Forest Hillsborough,
Limited North
Partnership Carolina 685,000 685,000 1,018,000 2,028,000 293,000 1,735,000
Wilcam Camden,
Housing, Ltd. Alabama 126,000 106,000 621,000 760,000 161,000 599,000
Wills Point Wills Point,
Manor, L.P. Texas 124,000 124,000 628,000 766,000 147,000 619,000
Windmere
Associates
Limited Lexington,
Partnership Virginia 291,000 291,000 1,483,000 1,839,000 305,000 1,534,000
Woodlands Mount
Apartments, Pleasant,
L.P. Texas 239,000 239,000 1,252,000 1,530,000 291,000 1,239,000
63
WNC Housing Tax Credit Fund III, L.P.
Schedule III
Real Estate Owned by Local Limited Partnerships
March 31, 2001
------------------------------------ ------------------------------------------------
As of March 31, 2001 As of December 31, 2000
- ------------------------------------------------------------------------------------------------------------------------------------
Partnerships Total Amount of Encumbrances
Original Investment Investment of Local Net
in Local Limited Paid Limited Property and Accumulated Book
Partnership Name Location Partnerships to Date Partnerships Equipment Depreciation Value
- ------------------------------------------------------------------------------------------------------------------------------------
Chillicothe,
Woodview Illinois and
Limited Glassford,
Partnership Illinois 269,000 269,000 1,194,000 1,581,000 353,000 1,228,000
-------------- ------------- -------------- ------------- ------------ ------------
$ 10,908,000 $ 10,857,000 $ 48,871,000 $ 64,660,000 $ 14,842,000 $ 49,818,000
============== ============= ============== ============= ============ ============
64
WNC Housing Tax Credit Fund III, L.P.
Schedule III
Real Estate Owned by Local Limited Partnerships
March 31, 2001
------------------------------------------------------------------------------
For the year ended December 31, 2000
------------------------------------------------------------------------------
Rental Net Year Investment Status Estimated Useful
Partnership Name Income Income/(loss) Acquired Life (Years)
- --------------------------------------------------------------------------------------------------------------------
Beaumont Elderly Housing, L.P. $ 97,000 $ (26,000) 1995 Completed 45
Brownfield Seniors Community, Ltd. 85,000 (9,000) 1994 Completed 40
Buffalo Apartments, Ltd. 92,000 12,000 1995 Completed 35
Cambridge Court Associates Limited
Partnership 135,000 (25,000) 1992 Completed 35
Candleridge Apartments of Bondurant
L.P. 126,000 (2,000) 1992 Completed 27.5
Candleridge Apartments of Waukee L.P. 135,000 (3,000) 1992 Completed 27.5
Carlinville Associates I, L.P. 86,000 (8,000) 1994 Completed 30
Cherokee Housing, Ltd. 69,000 (10,000) 1993 Completed 40
Chester Associates I, a Limited
Partnership 63,000 (39,000) 1992 Completed 27.5
Clinton Terrace Apartments, Ltd. 80,000 (5,000) 1993 Completed 40
Coffeeville Housing, Ltd. 57,000 (12,000) 1993 Completed 40
Coosa County Housing, Ltd. 60,000 (8,000) 1992 Completed 40
Crockett Manor, Ltd. 144,000 (20,000) 1994 Completed 40
Crockett Manor Senior Citizens
Complex, Ltd. 117,000 (6,000) 1993 Completed 50
Delta Manor, L.P. 145,000 (37,000) 1993 Completed 27.5
Eupora Apartments, L.P. 108,000 (24,000) 1992 Completed 40
Fairview Village V, Limited
Partnership 67,000 (14,000) 1992 Completed 40
Fox Lake Manor Limited Partnership 26,000 (17,000) 1994 Completed 27.5
Ft. Deposit Housing, Ltd. 77,000 (14,000) 1992 Completed 40
Gulf Coast Apartments, L.P. 184,000 (44,000) 1993 Completed 30
65
WNC Housing Tax Credit Fund III, L.P.
Schedule III
Real Estate Owned by Local Limited Partnerships
March 31, 2001
------------------------------------------------------------------------------
For the year ended December 31, 2000
------------------------------------------------------------------------------
Rental Net Year Investment Status Estimated Useful
Partnership Name Income Income/(loss) Acquired Life (Years)
- --------------------------------------------------------------------------------------------------------------------
Gulf Coast Apartments of Long Beach,
L.P. 216,000 (46,000) 1993 Completed 30
Heritage Colonial Homes, L.P. 67,000 (8,000) 1994 Completed 40
HOI Limited Partnership of Benson 191,000 (12,000) 1993 Completed 40
HOI Limited Partnership of Dallas 218,000 (54,000) 1993 Completed 40
HOI Limited Partnership of Dunn 117,000 (15,000) 1993 Completed 40
HOI Limited Partnership of Kings Mt. 150,000 (35,000) 1993 Completed 40
HOI Limited Partnership of Lee 286,000 (69,000) 1993 Completed 40
HOI Limited Partnership of Sanford 200,000 (54,000) 1993 Completed 40
HOI Limited Partnership of Selma 223,000 (27,000) 1993 Completed 40
Killbuck Limited Partnership 61,000 (11,000) 1992 Completed 27.5
Lake Ridge Apartments, L.P. 138,000 (68,000) 1994 Completed 50
Levelland Manor, L.P. 111,000 (36,000) 1993 Completed 40
Logan Park Associates Limited
Partnership 402,000 (20,000) 1993 Completed 27.5
Meadow Run Associates Limited
Partnership 155,000 (36,000) 1992 Completed 35
Oakdale Senior Housing Limited
Partnership 329,000 (210,000) 1993 Completed 30
Orange Beach Housing, Ltd. 107,000 (31,000) 1994 Completed 40
Parks I Limited Partnership 212,000 (24,000) 1993 Completed 40
Post Manor, L.P. 62,000 (37,000) 1992 Completed 40
Red Bud Associates I, a Limited
Partnership 52,000 (39,000) 1992 Completed 27.5
Steeleville Associates I, a Limited
Partnership 48,000 (21,000) 1992 Completed 27.5
Tanglewood Limited Partnership 107,000 (28,000) 1992 Completed 27.5
66
WNC Housing Tax Credit Fund III, L.P.
Schedule III
Real Estate Owned by Local Limited Partnerships
March 31, 2001
------------------------------------------------------------------------------
For the year ended December 31, 2000
------------------------------------------------------------------------------
Rental Net Year Investment Status Estimated Useful
Partnership Name Income Income/(loss) Acquired Life (Years)
- --------------------------------------------------------------------------------------------------------------------
Village Lane Properties, a Limited
Partnership 177,000 (22,000) 1993 Completed 25
Whitted Forest Limited Partnership 177,000 (44,000) 1993 Completed 40
Wilcam Housing, Ltd. 60,000 (25,000) 1993 Completed 40
Wills Point Manor, L.P. 81,000 (21,000) 1992 Completed 40
Windmere Associates Limited
Partnership 168,000 (29,000) 1992 Completed 35
Woodlands Apartments, L.P. 152,000 (39,000) 1992 Completed 40
Woodview Limited Partnership 149,000 (49,000) 1992 Completed 40
------------ ------------
$ 6,369,000 $(1,421,000)
============ ============
67
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.
WNC HOUSING TAX CREDIT FUND III, L.P.
By: WNC & Associates, Inc.,
General Partner
By: /s/ Wilfred N. Cooper, Jr.
--------------------------
Wilfred N. Cooper, Jr.,
President of WNC & Associates, Inc.
Date: ________ ___, 2003
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 registrant and
in the capacities and on the dates indicated.
By: /s/ Wilfred N. Cooper, Jr.
--------------------------
Wilfred N. Cooper, Jr.,
Chief Executive Officer, President and Director of
WNC & Associates, Inc. (principal executive officer)
Date: ________ ___, 2003
By: /s/ Thomas J. Riha
------------------
Thomas J. Riha,
Vice-President - Chief Financial Officer of WNC & Associates, Inc.
(principal financial officer and principal accounting
officer)
Date: ________ ___, 2003
By: /s/ Wilfred N. Cooper, Sr.
--------------------------
Wilfred N. Cooper, Sr.,
Chairman of the Board of WNC & Associates, Inc.
Date: ________ ___, 2003
By: /s/ David N. Shafer
--------------------
David N Shafer,
Director of WNC & Associates, Inc.
Date: ________ ___, 2003
68
CERTIFICATIONS
I, Wilfred N. Cooper, Jr., certify that:
1. I have reviewed this annual report on Form 10-K of WNC HOUSING TAX
CREDIT FUND III, L.P.;
2. Based on my knowledge, this annual report does not contain any untrue
statement of a material fact or omit to state a material fact
necessary to make the statements made, in light of the circumstances
under which such statements were made, not misleading with respect to
the periods covered by this annual report;
3. Based on my knowledge, the financial statements, and other financial
information included in this annual report, fairly present in all
material respects the financial condition, results of operations and
cash flows of the registrant as of, and for, the periods presented in
this annual report;
4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant
and we have:
(a) designed such disclosure controls and procedures to ensure that
material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within
those entities, particularly during the period in which this
annual report is being prepared;
(b) evaluated the effectiveness of the registrant's disclosure
controls and procedures as of a date within 90 days prior to the
filing date of this annual report (the "Evaluation Date"); and
(c) presented in this annual report our conclusions about the
effectiveness of the disclosure controls and procedures based on
our evaluation as of the Evaluation Date;
5. The registrant's other certifying officers and I have disclosed, based
on our most recent evaluation, to the registrant's auditors and the
audit committee of registrant's board of directors (or persons
performing the equivalent function):
(a) all significant deficiencies in the design or operation of
internal controls which could adversely affect the registrant's
ability to record, process, summarize and report financial data
and have identified for the registrant'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 registrant's
internal controls; and
6. The registrant's other certifying officers and I have indicated in
this annual 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.
Date: ________ ___, 2003
/s/ Wilfred N. Cooper, Jr.
---------------------------
[Signature]
Chairman and Chief Executive Officer of WNC & Associates, Inc.
69
CERTIFICATIONS
I, Thomas J. Riha, certify that:
1. I have reviewed this annual report on Form 10-K of WNC HOUSING TAX
CREDIT FUND III, L.P.;
2. Based on my knowledge, this annual report does not contain any untrue
statement of a material fact or omit to state a material fact
necessary 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 annual report;
3. Based on my knowledge, the financial statements, and other financial
information included in this annual report, fairly present in all
material respects the financial condition, results of operations and
cash flows of the registrant as of, and for, the periods presented in
this annual report;
4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant
and we have:
(a) designed such disclosure controls and procedures to ensure that
material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within
those entities, particularly during the period in which this
annual report is being prepared;
(b) evaluated the effectiveness of the registrant's disclosure
controls and procedures as of a date within 90 days prior to the
filing date of this annual report (the "Evaluation Date"); and
(c) presented in this annual report our conclusions about the
effectiveness of the disclosure controls and procedures based on
our evaluation as of the Evaluation Date;
5. The registrant's other certifying officers and I have disclosed, based
on our most recent evaluation, to the registrant's auditors and the
audit committee of registrant's board of directors (or persons
performing the equivalent function):
(a) all significant deficiencies in the design or operation of
internal controls which could adversely affect the registrant's
ability to record, process, summarize and report financial data
and have identified for the registrant'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 registrant's
internal controls; and
6. The registrant's other certifying officers and I have indicated in
this annual 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.
Date: ________ ___, 2003
/s/ Thomas J. Riha
[Signature]
Vice-President - Chief Financial Officer of WNC & Associates, Inc.
70