Supplemental Financial Report for

Quarter Ended March 31, 2018

Pages

Supplemental Letter from the CEO

4

Quarterly Fact Sheet

5

Financial Performance Trend Graphs

6-13

Other Partnership Information

14

Partnership Financial Statements

15-17

Partnership Financial Measures and Schedules

18-24

•

Total assets of $1.03 billion;

•

Total Mortgage Revenue Bond investments of $756.0 million;

•

Total revenue of $16.5 million;

•

Net income, basic and diluted, of 0.09 per Unit;

•

Cash Available for Distribution of $0.10 per Unit;

•

Increased its Investment in unconsolidated entities by $12.3 million;

•

Redemptions of three Mortgage Revenue Bonds for approximately $10.4 million; and

•

Entered into a Commercial Purchase and Sale Agreement to sell its Jade Park MF Property.

4

PARTNERSHIP DETAILS

ATAX was formed for the primary purpose of acquiring a portfolio of mortgage revenue bonds (“MRBs”) that are issued to provide construction and/or permanent financing of multifamily residential properties.  We continue to expect most of the interest paid on these MRBs is excludable from gross income for federal income tax purposes. We continue to pursue a business strategy of acquiring additional MRBs and other investments on a leveraged basis.  We also invest in other securities which, if not secured by a direct or indirect interest in a property, must be rated in one of the four highest rating categories by at least one nationally recognized securities rating agency.  We have also acquired interests in multifamily apartments (“MF Properties”) in order to position ourselves for future investments in mortgage revenue bonds issued to finance these properties.  In addition, we have invested in equity interests of multifamily, market rate, projects throughout the U.S.

(As of March 31, 2018)

Symbol (NASDAQ)

ATAX

Annual Distribution

$

0.50

Price

$

6.18

Yield

8.1%

Units Outstanding (including Restricted Units)

60,452,928

Market Capitalization

$

373,599,095

52-week Unit price range

$5.60 to $6.40

Partnership Financial Information for the Q1 2018

(amounts in thousands, except per Unit)

Total Revenue

$

16,458

Net Income – ATAX Partnership

$

6,004

Total Assets

$

1,033,500

Leverage Ratio³

64%

Cash Available for Distribution (“CAD”)¹

$

5,904

Distribution Declared per unit²

$

0.125

¹

Management utilizes a calculation of Cash Available for Distribution (“CAD”) to assess the Partnership’s operating performance. This is a non-GAAP financial measure and a reconciliation of our GAAP net income to CAD is provided on page 18 of the Supplement herein.

²

The most recent distribution was paid on April 30, 2018 for Unitholders of record as of March 30, 2018. The distribution is payable to Unitholders of record as of the last business day of the quarter end and ATAX trades ex-dividend two days prior to the record date, with a payable date of the last business day of the subsequent month.

³

Our overall leverage ratio is calculated as total outstanding debt divided by total partnership assets using the carrying value of the MRBs, PHC Certificates, initial finance costs, and the MF Properties at cost.

5

6

•

Total mortgage revenue bonds, core assets of ATAX, have increased to 73% of Total Assets at March 31, 2018, from 35% of Total Assets at December 31, 2012.

7

8

Description

- 25 basis points

+ 50 basis points

+ 100 basis points

+ 150 basis points

+ 200 basis points

TOB & Term A/B Debt

Financings

$7,092

$(19,169)

$(46,583)

$(66,229)

$(83,589)

TEBS Debt Financings

$133,965

$(112,350)

$(188,722)

$(289,412)

$(369,069)

Other Investment Financings

$101,365

$(204,210)

$(412,011)

$(615,974)

$(818,934)

Total

$242,422

$(335,729)

$(647,316)

$(971,615)

$(1,271,592)

¹

Represents the change over the next 12 months assuming an immediate shift in rates and management does not adjust its strategy in response.

9

¹

Total outstanding debt divided by total assets using the carrying value of the MRBs, PHC Certificates, initial finance costs and the MF Properties at cost.

10

•

During the fourth quarter of 2017, we recognized gains on the sale of approximately $6.7 million, net of income taxes and before direct and indirect expense, from the sale of three MF Properties and contingent interest of approximately $2.9 million. Tier 2 income paid to the General Partner for these items was approximately $874,000.

•

During the second quarter of 2017, we recognized contingent interest of approximately $87,000,

•

During the first quarter of 2017, we recognized a gain on the sale of Northern View (an MF Property) of approximately $3.2 million, net of income taxes and Tier 2 income paid to the General Partner, and before direct and indirect expense, and contingent interest of approximately $133,000,

•

During the fourth quarter of 2016, we recognized contingent interest of approximately $1.7 million,

•

During the third quarter of 2016, we recognized a gain of approximately $1.1 million, net of tax, on the sale of Woodland Park, an MF Property, and contingent interest of $90,000, and

•

During the second quarter of 2016, we recognized a gain of approximately $8.3 million, net of tax, on the sale of the Arboretum, an MF Property, and contingent interest income of approximately $45,000.

11

•

Since April 1, 2016, the ratio of “Salaries and benefits” and “General and administrative” expenses has averaged approximately 0.42% of Total Assets.

12

•

In 2017, we realized approximately $3.1 million of contingent interest and gains on sale of real estate assets of approximately $10.9 million, net of tax. Approximately $2.0 million was allocated to the General Partner and approximately $12.0 million that was allocated to the Unitholders.

•

In 2016, we realized approximately $2.0 million of contingent interest, of which $505,000 was due the General Partner. In addition, we reported the sale of the Arboretum and Woodland Park which resulted in gains of approximately $8.3 million and $1.1 million, respectively, net of tax, of which approximately $2.4 million was due the General Partner.  There was approximately $8.6 million that was allocated to the Unitholders.

13

OTHER PARTNERSHIP INFORMATION

Corporate Office:

Transfer Agent:

1004 Farnam Street

American Stock Transfer & Trust Company

Suite 400

59 Maiden Lane

Omaha, NE  68102

Plaza Level

Phone:

402-444-1630

New York, NY 10038

Investor Services:

402-930-3098

Phone: 718-921-8124

K-1 Services:

855-4AT-AXK1

888-991-9902

Fax:

402-930-3047

Fax:718-236-2641

Web Site:

www.ataxfund.com

K-1 Services Email:

k1s@ataxfund.com

Ticker Symbol:

ATAX

Corporate Counsel:

Independent Accountants:

Barnes & Thornburg LLP

PwC

11 S. Meridian Street

1 North Wacker Drive

Indianapolis, IN 46204

Chicago, Illinois 60606

Burlington Capital LLC, General Partner of the General Partner for ATAX

Board of Managers

Michael B. Yanney

Chairman Emeritus of the Board

Lisa Y. Roskens

Chairman of the Board

Mariann  Byerwalter

Manager

Dr. William S. Carter

Manager

Patrick J. Jung

Manager

George  Krauss

Manager

Dr. Gail Yanney

Manager

Walter K. Griffith

Manager

Senator Michael Johanns

Manager

Corporate Officers

Chief Executive Officer – Chad L. Daffer

Chief Financial Officer – Craig S. Allen

14

Partnership Financial

Statements and Information

Schedules

March 31, 2018

December 31, 2017

Assets

Cash and cash equivalents

$

53,959,775

$

69,597,699

Restricted cash

1,115,880

1,985,630

Interest receivable, net

8,197,276

6,541,132

Mortgage revenue bonds held in trust, at fair value

681,201,158

710,867,447

Mortgage revenue bonds, at fair value

74,758,296

77,971,208

Public housing capital fund trusts, at fair value

48,939,254

49,641,588

Real estate assets:

Land and improvements

7,414,657

7,319,235

Buildings and improvements

79,130,567

78,953,488

Real estate assets before accumulated depreciation

86,545,224

86,272,723

Accumulated depreciation

(10,484,484

)

(9,580,531

)

Net real estate assets

76,060,740

76,692,192

Investment in equity interests

52,809,740

39,608,927

Property loans, net

29,430,525

29,513,874

Other assets

7,026,986

7,348,302

Total Assets

$

1,033,499,630

$

1,069,767,999

Liabilities

Accounts payable, accrued expenses and other liabilities

$

7,752,984

$

8,494,227

Distribution payable

7,632,945

8,423,803

Unsecured lines of credit

50,000,000

50,000,000

Debt financing, net

550,425,793

558,328,347

Mortgages payable and other secured financing, net

35,453,563

35,540,174

Derivative swaps, at fair value

341,740

826,852

Total Liabilities

651,607,025

661,613,403

Redeemable preferred units

94,323,338

94,314,326

Partners' Capital

General Partner

185,189

437,256

Beneficial Unit Certificate holders

287,384,078

313,403,014

Total Partners' Capital

287,569,267

313,840,270

Total Liabilities and Partners' Capital

$

1,033,499,630

$

1,069,767,999

16

For The Three Months Ended March 31, 2018

For The Three Months Ended March 31, 2017

Revenues:

Investment income

$

13,378,486

$

11,470,186

Property revenues

2,336,512

3,729,778

Contingent interest income

-

132,650

Other interest income

743,036

645,137

Other income

-

62,637

   Total Revenues

16,458,034

16,040,388

Expenses:

Real estate operating (exclusive of items shown below)

1,395,493

2,484,216

Depreciation and amortization

906,315

1,592,826

Amortization of deferred financing costs

464,772

740,238

Interest expense

4,882,305

5,442,253

General and administrative

2,811,845

3,130,880

   Total Expenses

10,460,730

13,390,413

Other Income:

Gain on sale of real estate assets, net

-

7,168,587

Income before income taxes

5,997,304

9,818,562

Income tax expense

(7,000)

2,458,047

Net income before noncontrolling interest

6,004,304

7,360,515

Income (loss) attributable to noncontrolling interest

-

71,653

Net income - ATAX Partnership

$

6,004,304

$

7,288,862

Net income - ATAX Partnership

6,004,304

7,288,862

   Redeemable preferred unit distributions and accretion

(717,763)

(324,642)

Net income available to Partners

$

5,286,541

$

6,964,220

Selected Segment Data (Partnership):

Revenue and Other Income

   Mortgage Revenue Bond Investments

$

12,070,556

$

10,588,498

   MF Properties

2,336,512

10,961,002

   Public Housing Capital Fund Trusts

620,106

708,786

Other Investments

1,430,860

950,689

Total  Revenue and Other Income

$

16,458,034

$

23,208,975

Total Expenses:

   Mortgage Revenue Bond Investments

$

7,770,961

$

8,359,445

   MF Properties

2,699,242

7,215,457

   Public Housing Capital Fund Trusts

(26,016)

345,211

Other Investments

9,543

-

Total

$

10,453,730

$

15,920,113

Net Income (loss) - ATAX Partnership

   Mortgage Revenue Bond Investments

$

4,299,595

$

2,229,053

   MF Properties

(362,730)

3,745,545

   Public Housing Capital Fund Trusts

646,122

363,575

Other Investments

1,421,317

950,689

Income from continuing operations

$

6,004,304

$

7,288,862

17

March 31, 2018

December  31, 2017

September 30, 2017

June 30, 2017

March 31, 2017

December 31, 2016

September 30, 2016

June 30,  2016

Partnership net income

$

6,004,304

$

15,647,453

$

3,545,483

$

4,109,400

$

7,288,862

$

5,623,335

$

4,623,542

$

11,005,930

Change in fair value of derivatives and interest

   rate derivative amortization

(989,995

)

(129,595

)

66,917

181,420

121,349

(1,395,730

)

(263,684

)

531,389

Depreciation and amortization expense

906,315

1,090,599

1,259,055

1,270,379

1,592,826

1,569,641

1,361,259

1,806,732

Impairment of securities

-

761,960

-

-

-

-

-

-

Impairment charge on real estate assets

-

-

-

-

-

-

-

61,506

Amortization of deferred financing costs

464,772

444,299

577,413

562,585

740,238

512,309

425,520

392,493

Restricted units compensation expense

206,636

455,119

550,390

438,893

170,840

802,092

31,050

-

Deferred income taxes

34,000

(26,000

)

(9,000

)

(201,000

)

(164,000

)

(51,000

)

(136,000

)

553,000

Redeemable Series A Preferred Unit distribution

   and accretion

(717,763

)

(701,664

)

(523,682

)

(432,550

)

(324,642

)

(274,772

)

(181,969

)

(124,982

)

Bond purchase premium (discount) amortization

   (accretion), net of cash received

(4,098

)

(193,530

)

(26,270

)

(26,741

)

(23,507

)

(27,770

)

(147,033

)

33,668

Tier 2 Income distributable to the General Partner

-

(873,893

)

-

(16,224

)

(1,104,401

)

(426,774

)

(291,295

)

(2,096,982

)

CAD

$

5,904,171

$

16,474,748

$

5,440,306

$

5,886,162

$

8,297,565

$

6,331,331

$

5,421,390

$

12,162,754

Weighted average number of units outstanding, basic

60,124,333

59,895,229

59,811,578

59,862,969

60,037,687

59,995,789

60,176,937

60,252,928

Partnership Only:

Net income, basic and diluted, per unit

$

0.09

$

0.23

$

0.05

$

0.06

$

0.10

$

0.09

$

0.07

$

0.15

CAD per unit, basic

$

0.10

$

0.27

$

0.09

$

0.10

$

0.14

$

0.11

$

0.09

$

0.20

Distributions declared, per unit

$

0.125

$

0.125

$

0.125

$

0.125

$

0.125

$

0.125

$

0.125

$

0.125

18

Base

Maturity

Interest

Principal

Estimated

Property Name

Location

Date

Rate

Outstanding

Fair Value

15 West Apartments

Vancouver, WA

7/1/2054

6.25

%

$

9,783,080

$

11,188,788

Arbors at Hickory Ridge

Memphis, TN

1/1/2049

6.25

%

11,207,341

12,479,986

Avistar on the Boulevard - Series A

San Antonio, TX

3/1/2050

6.00

%

16,068,745

17,336,951

Avistar at the Crest - Series A

San Antonio, TX

3/1/2050

6.00

%

9,432,184

10,217,830

Avistar (February 2013 Acquisition) - Series B (2 Bonds)

San Antonio, TX

4/1/2050

9.00

%

1,193,205

1,243,298

Avistar at the Oak - Series A

San Antonio, TX

8/1/2050

6.00

%

7,616,915

8,246,425

Avistar in 09 - Series A

San Antonio, TX

8/1/2050

6.00

%

6,576,911

7,091,071

Avistar on the Hill - Series A

San Antonio, TX

8/1/2050

6.00

%

5,262,510

5,697,437

Avistar (June 2013 Acquisition) - Series B (2 Bonds)

San Antonio, TX

9/1/2050

9.00

%

999,149

1,035,979

Avistar at Copperfield - Series A

Houston, TX

5/1/2054

5.75

%

10,000,000

10,198,101

Avistar at Copperfield - Series B

Houston, TX

6/1/2054

12.00

%

4,000,000

4,012,133

Avistar at the Parkway - Series A

San Antonio, TX

5/1/2052

6.00

%

13,204,519

13,686,410

Avistar at the Parkway - Series B

San Antonio, TX

6/1/2052

12.00

%

124,799

150,955

Avistar at Wilcrest - Series A

Houston, TX

5/1/2054

5.75

%

3,775,000

3,745,738

Avistar at Wilcrest - Series B

Houston, TX

6/1/2054

12.00

%

1,550,000

1,554,770

Avistar at Wood Hollow - Series A

Austin, TX

5/1/2054

5.75

%

31,850,000

32,353,531

Avistar at Wood Hollow - Series B

Austin, TX

6/1/2054

12.00

%

8,410,000

8,437,371

Bella Vista

Gainesville, TX

4/1/2046

6.15

%

6,295,000

6,367,246

Bridle Ridge

Greer, SC

1/1/2043

6.00

%

7,430,000

7,477,812

Brookstone

Waukegan, IL

5/1/2040

5.45

%

8,953,982

8,899,547

Bruton

Dallas, TX

8/1/2054

6.00

%

18,022,873

19,998,262

Columbia Gardens

Columbia, SC

12/1/2050

5.50

%

13,161,000

14,603,907

Companion at Thornhill Apartments

Lexington, SC

1/1/2052

5.80

%

11,377,893

12,337,932

Concord at Gulfgate - Series A

Houston, TX

2/1/2032

6.00

%

19,185,000

21,279,593

Concord at Little York - Series A

Houston, TX

2/1/2032

6.00

%

13,440,000

14,970,165

Concord at Williamcrest - Series A

Houston, TX

2/1/2032

6.00

%

20,820,000

23,190,389

Copper Gate Apartments

Lafayette, IN

12/1/2029

6.25

%

5,100,000

5,724,322

Courtyard Apartments - Series A

Fullerton, CA

12/1/2033

5.00

%

10,230,000

11,013,927

Courtyard Apartments - Series B

Fullerton, CA

12/1/2018

8.00

%

6,228,000

6,217,762

Cross Creek

Beaufort, SC

3/1/2049

6.15

%

8,145,133

8,844,284

Crossing at 1415 - Series A

San Antonio, TX

12/1/2052

6.00

%

7,524,044

8,049,675

Decatur Angle

Fort Worth, TX

1/1/2054

5.75

%

22,754,649

24,220,525

Glenview - Series A

Cameron Park, CA

12/1/2031

5.75

%

4,616,146

5,008,167

Greens of Pine Glen - Series A

Durham, NC

10/1/2047

6.50

%

8,104,000

9,025,283

Greens of Pine Glen - Series B

Durham, NC

10/1/2047

9.00

%

936,570

1,106,314

Harden Ranch - Series A

Salinas, CA

3/1/2030

5.75

%

6,828,743

7,714,907

Harmony Court Bakersfield - Series A

Bakersfield, CA

12/1/2033

5.00

%

3,730,000

3,997,644

Harmony Terrace - Series A

Simi Valley, CA

1/1/2034

5.00

%

6,900,000

7,465,636

Harmony Terrace - Series B

Simi Valley, CA

1/1/2019

8.00

%

7,400,000

7,395,022

Heights at 515 - Series A

San Antonio, TX

12/1/2052

6.00

%

6,888,392

7,488,957

Heritage Square - Series A

Edinburg, TX

9/1/2051

6.00

%

11,037,518

11,714,190

Lake Forest Apartments

Daytona Beach, FL

12/1/2031

6.25

%

8,469,000

9,650,238

Las Palmas II - Series A

Coachella, CA

11/1/2033

5.00

%

1,695,000

1,815,860

Las Palmas II - Series B

Coachella, CA

11/1/2018

8.00

%

1,770,000

1,768,262

19

Base

Maturity

Interest

Principal

Estimated

Property Name

Location

Date

Rate

Outstanding

Fair Value

Live 929

Baltimore, MD

7/1/2049

5.78

%

39,965,000

43,518,657

Montclair - Series A

Lemoore, CA

12/1/2031

5.75

%

2,500,824

2,822,507

Montecito at Williams Ranch Apartments - Series A

Salinas, CA

10/1/2034

5.50

%

7,690,000

8,475,929

Montecito at Williams Ranch Apartments - Series B

Salinas, CA

10/1/2019

5.50

%

4,781,000

4,771,455

Oaks at Georgetown - Series A

Georgetown, TX

1/1/2034

5.00

%

12,330,000

12,747,098

Oaks at Georgetown - Series B

Georgetown, TX

1/1/2019

8.00

%

5,512,000

5,501,238

Ohio Bond - Series A

Ohio

6/1/2050

7.00

%

14,083,000

14,717,474

Ohio Bond - Series B

Ohio

6/1/2050

10.00

%

3,532,410

3,662,939

Pro Nova - 2014-1

Knoxville, TN

5/1/2034

6.00

%

10,000,000

9,964,149

Renaissance - Series A

Baton Rouge, LA

6/1/2050

6.00

%

11,211,177

12,706,618

Rosewood Townhomes - Series A

Goose Creek, SC

7/1/2055

5.75

%

9,280,000

8,821,856

Rosewood Townhomes - Series B

Goose Creek, SC

8/1/2055

12.00

%

470,000

476,406

Runnymede

Austin, TX

10/1/2042

6.00

%

10,150,000

10,290,110

San Vicente - Series A

Soledad, CA

11/1/2033

5.00

%

3,495,000

3,677,421

San Vicente - Series B

Soledad, CA

11/1/2018

8.00

%

1,825,000

1,821,196

Santa Fe - Series A

Hesperia, CA

12/1/2031

5.75

%

3,029,654

3,444,124

Seasons at Simi Valley - Series A

Simi Valley, CA

9/1/2032

5.75

%

4,356,248

5,004,795

Seasons at Simi Valley - Series B

Simi Valley, CA

9/1/2018

8.00

%

1,944,000

1,942,864

Seasons Lakewood - Series A

Lakewood, CA

1/1/2034

5.00

%

7,350,000

7,916,282

Seasons San Juan Capistrano - Series A

San Juan Capistrano, CA

1/1/2034

5.00

%

12,375,000

13,087,746

Seasons San Juan Capistrano - Series B

San Juan Capistrano, CA

1/1/2019

8.00

%

6,574,000

6,560,875

Silver Moon - Series A

Albuquerque, NM

8/1/2055

6.00

%

7,865,663

8,548,870

South Pointe - Series A

Hanahan, SC

7/1/2055

5.75

%

21,600,000

20,629,426

South Pointe - Series B

Hanahan, SC

8/1/2055

12.00

%

1,100,000

1,113,331

Southpark

Austin, TX

12/1/2049

6.13

%

13,300,000

14,391,532

Summerhill - Series A

Bakersfield, CA

12/1/2033

5.00

%

6,423,000

6,883,878

Sycamore Walk - Series A

Bakersfield, CA

1/1/2033

5.25

%

3,625,940

3,938,435

The Palms at Premier Park

Columbia, SC

1/1/2050

6.25

%

19,191,003

21,136,447

The Village at Madera - Series A

Madera, CA

12/1/2033

5.00

%

3,085,000

3,306,362

The Village at Madera - Series B

Madera, CA

12/1/2018

8.00

%

1,719,000

1,717,464

Tyler Park Townhomes

Greenfield, CA

1/1/2030

5.75

%

5,950,280

6,520,861

Vantage at Judson

San Antonio, TX

1/1/2053

6.00

%

26,078,566

28,189,581

Village at River's Edge

Columbia, SC

6/1/2033

6.00

%

9,984,860

11,309,766

Vineyard Gardens - Series A

Oxnard, CA

1/1/2035

5.50

%

3,995,000

4,497,367

Vineyard Gardens - Series B

Oxnard, CA

1/1/2020

5.50

%

2,846,000

2,825,904

Westside Village Market

Shafter, CA

1/1/2030

5.75

%

3,888,497

4,371,158

Willow Run

Columbia, SC

12/1/2050

5.50

%

12,977,000

14,347,673

Woodlynn Village

Maplewood, MN

11/1/2042

6.00

%

4,267,000

4,277,058

$

708,448,423

$

755,959,454

20

Weighted

Weighted Avg.

Principal

Estimated

Name

Average Lives

Coupon Rate

Outstanding

Fair Value

Public Housing Capital Fund Trust Certificate I

7.26

5.37

%

$

24,913,137

$

24,836,229

Public Housing Capital Fund Trust Certificate II

6.30

4.33

%

9,536,833

9,087,367

Public Housing Capital Fund Trust Certificate III

7.57

5.29

%

15,674,330

15,015,658

$

50,124,300

$

48,939,254

21

Base

Maturity

Interest

Principal

Estimated

Property Name

Location

Date

Rate

Outstanding

Fair Value

15 West Apartments

Vancouver, WA

7/1/2054

6.25

%

$

9,797,833

$

11,637,481

Arbors at Hickory Ridge

Memphis, TN

1/1/2049

6.25

%

11,237,041

13,035,860

Avistar on the Boulevard - Series A

San Antonio, TX

3/1/2050

6.00

%

16,109,972

18,057,437

Avistar at the Crest - Series A

San Antonio, TX

3/1/2050

6.00

%

9,456,384

10,643,526

Avistar (February 2013 Acquisition) - Series B (2 Bonds)

San Antonio, TX

4/1/2050

9.00

%

1,194,783

1,286,887

Avistar at the Oak - Series A

San Antonio, TX

8/1/2050

6.00

%

7,635,895