Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Jun. 30, 2013 | |
Document and Entity Information: | ' | ' |
Entity Registrant Name | 'NATIONAL TAX CREDIT INVESTORS II | ' |
Document Type | '10-K | ' |
Document Period End Date | 31-Dec-13 | ' |
Amendment Flag | 'false | ' |
Entity Central Index Key | '0000859921 | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Common Stock, Shares Outstanding | 72,017 | ' |
Entity Public Float | ' | $0 |
Entity Filer Category | 'Smaller Reporting Company | ' |
Entity Current Reporting Status | 'Yes | ' |
Entity Voluntary Filers | 'No | ' |
Entity Well-known Seasoned Issuer | 'No | ' |
Document Fiscal Year Focus | '2013 | ' |
Document Fiscal Period Focus | 'FY | ' |
Balance_Sheets
Balance Sheets (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Assets | ' | ' |
Cash and cash equivalents | $3,577 | $5,163 |
Mortgage note receivable | 3,478 | 3,533 |
Accounts receivable - limited partners | 181 | 181 |
Other assets | 54 | 54 |
Total assets | 7,290 | 8,931 |
Liabilities: | ' | ' |
Accounts payable and accrued expenses | 32 | 40 |
Partners' (deficiency) capital: | ' | ' |
General partner | -556 | -540 |
Limited partners | 7,814 | 9,431 |
Total partners' (deficiency) capital | 7,258 | 8,891 |
Total liabilities and partners' (deficiency) capital | $7,290 | $8,931 |
Statements_of_Operations
Statements of Operations (USD $) | 12 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Revenues: | ' | ' |
Interest Income | $0 | $12 |
Other Income | 0 | 19 |
Total Revenues | 0 | 31 |
Operating Expenses: | ' | ' |
Management fees - general partner | 107 | 107 |
General and administrative | 54 | 50 |
Tax expense | 0 | 13 |
Legal and accounting | 83 | 72 |
Total operating expenses | 244 | 242 |
Loss from partnership operations | -244 | -211 |
Gain from sales of limited partnership interests in Local Partnerships | -10 | -3,652 |
Advance recognized as expense as income (loss) | -1,344 | ' |
Equity in income (loss) of Local Partnerships and amortization of acquisition costs | -55 | -141 |
Net Income (Loss) | -1,633 | 3,300 |
Net Income (Loss) allocated to general partner (1%) | -16 | 33 |
Net Income (Loss) allocated to limited partners (99%) | ($1,617) | $3,267 |
Net Income (Loss) per limited partnership interest | ($22.45) | $45.25 |
Statement_of_Changes_in_Partne
Statement of Changes in Partners' (Deficiency) Capital (USD $) | General Partner | Limited Partners | Total |
In Thousands | |||
Partners' (deficiency) capital, beginning balance at Dec. 31, 2011 | ($573) | $6,164 | $5,591 |
Net Income (Loss) | 33 | 3,267 | 3,300 |
Partners' (deficiency) capital, ending balance at Dec. 31, 2012 | -540 | 9,431 | 8,891 |
Net Income (Loss) | -16 | -1,617 | -1,633 |
Partners' (deficiency) capital, ending balance at Dec. 31, 2013 | ($556) | $7,814 | $7,258 |
Statements_of_Cash_Flows
Statements of Cash Flows (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Cash flows from operating activities: | ' | ' |
Net Income (Loss) | ($1,633) | $3,300 |
Adjustments to reconcile Net Income (Loss) to net cash used in operating activities: | ' | ' |
Gain from sales of limited partnership interests in Local Partnerships | -10 | -3,652 |
Advances made to Local Partnership recognized as expense | 1,344 | ' |
Equity in loss of Local Partnerships | 55 | 141 |
Change in Accounts Receivable - Limited Partners | ' | -181 |
Change in Other Assets | ' | -54 |
Change in Accounts payable and accrued expenses | -8 | -85 |
Net cash used in operating activities | -252 | -531 |
Cash flows provided by (used in) investing activities: | ' | ' |
Advances to Local Partnership | -1,344 | ' |
Proceeds from sales of limited partnership interests in Local Partnerships | 10 | 3,550 |
Net cash flows provided by (used in) investing activities | -1,334 | 3,550 |
Net decrease in cash and cash equivalents | -1,586 | 3,019 |
Cash and cash equivalents, beginning of period | 5,163 | 2,144 |
Cash and cash equivalents, end of period | $3,577 | $5,163 |
Note_1_Organization_and_Summar
Note 1 - Organization and Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2013 | |
Notes | ' |
Note 1 - Organization and Summary of Significant Accounting Policies | ' |
Note 1 - Organization and Summary of Significant Accounting Policies | |
Organization | |
National Tax Credit Investors II (“NTCI II” or the “Partnership”) is a limited partnership formed under the California Revised Local Partnership Act as of January 12, 1990. The Partnership was formed to invest primarily in other limited partnerships (“Local Partnerships”) which own and operate multifamily housing complexes that are eligible for low income housing federal income tax credits (the “Housing Tax Credit”). The general partner of the Partnership is National Partnership Investments, LLC (the “General Partner” or “NAPICO”), a California limited liability company. The General Partner is a subsidiary of Bethesda Holdings II, LLC, a privately held real estate asset management company (“Bethesda”). Bethesda acquired the General Partner on December 19, 2012, pursuant to an option agreement with Aimco/Bethesda Holdings, Inc., a subsidiary of Apartment Investment and Management Company (“Aimco”), a publicly traded real estate investment trust. The business of NTCI II is conducted primarily by NAPICO. The Partnership shall continue in full force and effect until December 31, 2030, unless terminated earlier pursuant to the Partnership Agreement or law. | |
The General Partner has a one percent interest in operating profits and losses of the Partnership. The limited partners will be allocated the remaining 99 percent interest in proportion to their respective investments. | |
Upon total or partial liquidation of the Partnership or the disposition or partial disposition of a project or project interest and distribution of the proceeds, the General Partner will be entitled to a property disposition fee as mentioned in the partnership agreement. The limited partners will have a priority item equal to their invested capital plus 6 percent priority return as defined in the partnership agreement. This property disposition fee may accrue but shall not be paid until the limited partners have received distributions equal to 100 percent of their capital contributions plus the 6 percent priority return. No disposition fees have been paid or accrued. | |
At December 31, 2013 and 2012, the Partnership had outstanding 72,017 and 72,032 limited partnership interests, respectively. | |
Basis of Presentation | |
The accompanying financial statements have been prepared in conformity with accounting principles generally accepted in the United States. | |
Cash and Cash Equivalents | |
Cash and cash equivalents include cash on hand and in banks. At certain times, the amount of cash deposited at a bank may exceed the limit on insured deposits. The entire cash balance at December 31, 2012 was maintained by an affiliated management company on behalf of affiliated entities in a cash concentration account. In 2013 the affiliated management company maintained separate cash accounts with an FDIC insured bank for each of its affiliated entities including National Tax Credit Investors II. | |
Method of Accounting for Investments in Local Partnerships | |
The investments in Local Partnerships are accounted for using the equity method. Acquisition fees, selection fees and other costs related to the acquisition of the projects have been capitalized as part of the investment account and are being amortized by the straight line method over the estimated lives of the underlying assets, which is generally 30 years. | |
Use of Estimates | |
The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates. | |
Net Income Per Limited Partnership Interest | |
Net income per limited partnership interest was computed by dividing the limited partners' share of net income by the number of limited partnership interests outstanding at the beginning of the year. The number of limited partnership interests used was 72,032 and 72,205 for the years ended December 31, 2013 and 2012, respectively. | |
Abandoned Interests | |
During 2013 and 2012, the number of limited partnership interests decreased by 15 and 173 units, respectively, due to limited partners abandoning their interests. In abandoning his or her partnership interests, a limited partner relinquishes all right, title and interest in the Partnership as of the date of the abandonment. | |
Mortgage Note Receivable | |
The Partnership reviews its mortgage note receivable whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. The Partnership has recorded its mortgage note receivable at December 31, 2013 and December 31, 2012 at the amount at which the Partnership ultimately expects to receive. No impairment was recognized during the years ended December 31, 2013 or 2012. See “Note 3 – Mortgage Note Receivable” for further information. | |
Impairment of Long-Lived Assets | |
The Partnership reviews long-lived assets to determine if there has been any impairment whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. If the sum of the expected future cash flows is less than the carrying amount of the assets, the Partnership recognizes an impairment loss. There were no impairment losses recognized during the years ended December 31, 2013 and 2012. | |
Fair Value of Financial Instruments | |
Financial Accounting Standards Board Accounting Standards Codification (“ASC”) Topic 825, “Financial Instruments”, requires disclosure of fair value information about financial instruments, whether or not recognized in the balance sheet, for which it is practicable to estimate fair value. Fair value is defined as the amount at which the instruments could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale. At December 31, 2013, the Partnership believes that the carrying amount of other assets and liabilities reported on the balance sheet that require such disclosure approximated their fair value due to the short-term maturity of these instruments. | |
Segment Reporting | |
ASC Topic 280-10, “Segment Reporting”, established standards for the way that public business enterprises report information about operating segments in annual financial statements and requires that those enterprises report selected information about operating segments in interim financial reports. ASC Topic 280-10 also established standards for related disclosures about products and services, geographic areas, and major customers. As defined in ASC Topic 280-10, the Partnership has only one reportable segment. | |
Variable Interest Entities | |
The Partnership consolidates any variable interest entities in which the Partnership holds a variable interest and is the primary beneficiary. Generally, a variable interest entity, or VIE, is an entity with one or more of the following characteristics: (a) the total equity investment at risk is not sufficient to permit the entity to finance its activities without additional subordinated financial support; (b) as a group the holders of the equity investment at risk lack (i) the ability to make decisions about an entity’s activities through voting or similar rights, (ii) the obligation to absorb the expected losses of the entity, or (iii) the right to receive the expected residual returns of the entity; or (c) the equity investors have voting rights that are not proportional to their economic interests and substantially all of the entity’s activities either involve, or are conducted on behalf of, an investor that has disproportionately few voting rights. The primary beneficiary of a VIE is generally the entity that has (a) the power to direct the activities of the VIE that most significantly impact the VIE’s economic performance, and (b) the obligation to absorb losses or the right to receive benefits that could potentially be significant to the VIE. | |
In determining whether it is the primary beneficiary of a VIE, the Partnership considers qualitative and quantitative factors, including, but not limited to: which activities most significantly impact the VIE’s economic performance and which party controls such activities; the amount and characteristics of the Partnership’s investment; the obligation or likelihood for the Partnership or other investors to provide financial support; and the similarity with and significance to the business activities of the Partnership and the other investors. Significant judgments related to these determinations include estimates about the current and future fair values and performance of real estate held by these VIEs and general market conditions. | |
At December 31, 2013 and 2012, the Partnership held variable interests in two and four VIEs, respectively, for which the Partnership was not the primary beneficiary. The Partnership has concluded, based on its qualitative consideration of the partnership agreement, the partnership structure and the role of the general partner in each of the Local Partnerships, that the general partner of each of the Local Partnerships is the primary beneficiary of the respective Local Partnership. In making this determination, the Partnership considered the following factors: | |
· the general partners conduct and manage the business of the Local Partnerships; | |
· the general partners have the responsibility for and sole discretion over selecting a property management agent for the Local Partnerships’ underlying real estate properties; | |
· the general partners are responsible for approving operating and capital budgets for the properties owned by the Local Partnerships; | |
· the general partners are obligated to fund any recourse obligations of the Local Partnerships; | |
· the general partners are authorized to borrow funds on behalf of the Local Partnerships; and | |
· the Partnership, as a limited partner in each of the Local Partnerships, does not have the ability to direct or otherwise significantly influence the activities of the Local Partnerships that most significantly impact such entities’ economic performance. | |
The two VIEs at December 31, 2013 consisted of Local Partnerships that were directly engaged in the ownership and management of two apartment properties with a total of 355 units. The Partnership is involved with those VIEs as a non-controlling limited partner equity holder. The Partnership’s maximum exposure to loss as a result of its involvement with the unconsolidated VIEs is limited to the Partnership’s recorded investments in and receivables from these VIEs, which was approximately $3,478,000 and $3,533,000 at December 31, 2013 and 2012, respectively. The Partnership may be subject to additional losses to the extent of any financial support that the Partnership voluntarily provides in the future. |
Note_2_Investments_in_and_Adva
Note 2 - Investments in and Advances To Local Partnerships | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Notes | ' | ||||||||
Note 2 - Investments in and Advances To Local Partnerships | ' | ||||||||
Note 2 - Investments In and Advances to Local Partnerships | |||||||||
As of December 31, 2013 and 2012, the Partnership holds limited partnership interests in two and four Local Partnerships, respectively, located in two and four states, respectively. As a limited partner of the Local Partnerships, the Partnership does not have authority over day-to-day management of the Local Partnerships or their properties (the "Apartment Complexes"). The general partners responsible for management of the Local Partnerships (the "Local Operating General Partners") are not affiliated with the General Partner of the Partnership, except as discussed below. | |||||||||
At December 31, 2013 and 2012, the Local Partnerships own residential projects consisting of 355 and 494 apartment units, respectively. During the year ended December 31, 2013, the Partnership sold its limited partnership interest in two of the Local Partnerships owning residential projects consisting of 139 apartment units. | |||||||||
The projects owned by the Local Partnerships in which the Partnership has invested were developed by the Local Operating General Partners who acquired the sites and applied for applicable mortgages and subsidies, if any. The Partnership became the principal limited partner in these Local Partnerships pursuant to arm's-length negotiations with the Local Operating General Partners. As a limited partner, the Partnership’s liability for obligations of the Local Partnerships is limited to its investment. The Local Operating General Partner of the Local Partnerships retains responsibility for developing, constructing, maintaining, operating and managing the Projects. Under certain circumstances, an affiliate of NAPICO or the Partnership may act as the Local Operating General Partner. An affiliate of NAPICO, National Tax Credit Inc. II ("NTC-II") is acting either as a special limited partner or non-managing administrative general partner (the “Administrative General Partner”) of each Local Partnership in which the Partnership had an investment. | |||||||||
The Partnership, as a limited partner, does not have a contractual relationship with the Local Partnerships or exercise control over the activities and operations, including refinancing or selling decisions, of the Local Partnerships that would require or allow for consolidation. Accordingly, the Partnership accounts for its investments in the Local Partnerships using the equity method. The Partnership is allocated profits and losses of the Local Partnerships based upon its respective ownership percentage (between 98.90% and 99%). The Partnership is allocated profits and losses and receives distributions from refinancings and sales in accordance with the Local Partnerships’ partnership agreements. These agreements usually limit the Partnership’s distributions to an amount substantially less than its ownership percentage in the Local Partnership. | |||||||||
The individual investments are carried at cost plus the Partnership’s share of the Local Partnership’s profits less the Partnership’s share of the Local Partnership’s losses, distributions and impairment charges. See “Note 1 – Organization and Summary of Significant Accounting Policies” for a description of the impairment policy. The Partnership is not legally liable for the obligations of the Local Partnerships and is not otherwise committed to provide additional support to them. Therefore, the Partnership does not recognize losses once the Partnership’s investment in each of the Local Partnerships reaches zero. Distributions from the Local Partnerships are accounted for as a reduction of the investment balance until the investment balance is reduced to zero. When the investment balance has been reduced to zero, subsequent distributions received are recognized as income in the accompanying statements of operations. During the year ended December 31, 2013 and 2012, there were no such distributions received. | |||||||||
For those investments where the Partnership has determined that the carrying value of the Partnership’s investments approximates the estimated fair value of those investments, the Partnership’s policy is to recognize equity in income of the Local Partnerships only to the extent of distributions received and amortization of acquisition costs from those Local Partnerships. Therefore, the Partnership limits its recognition of equity earnings to the amount it expects to ultimately realize. | |||||||||
In October 2013, the Partnership assigned its limited partnership interest in Jamestown Terrace to an affiliate of the Local Operating General Partner for a total of $10,000. This amount will be recognized as a gain on sales of limited partnership interest in Local Partnerships during the year ended December 31, 2013 as the Partnership had no investment balance remaining at the date of the assignment. | |||||||||
In November 2013, the Partnership assigned its limited partnership interest in Virginia Park Meadows to an affiliate of the Local Operating General Partner for no consideration. This agreement was subject to the Partnership paying a $3,000 transfer fee to the state of Michigan. The Partnership had no investment balance remaining as of the date of the agreement. | |||||||||
During November 2011, the Partnership entered into an assignment and assumption agreement with a third party affiliated with the operating general partner of Countryside North American Partners, L.P. (“Countryside”). The agreement provided for an assignment of the Partnership’s 99% limited partnership interest in Countryside for $3,700,000. The assignment was subject to the consent of the Executive Director of the New Jersey Housing and Mortgage Finance Agency, which was received during December 2011. | |||||||||
Upon receipt of approval from the Executive Director of the New Jersey Housing and Mortgage Finance Agency, the assignment of the Partnership’s 99% limited partnership interest in Countryside became effective on December 30, 2011. Pursuant to the terms of the assignment agreement, the Partnership received a deposit of $150,000 in cash and a promissory note in the principal amount of $3,550,000 in December 2011. The promissory note had a maturity date of June 30, 2012 and bore interest at the annual rate of two percent if paid on or before March 31, 2012 and seven percent if paid after March 31, 2012. At December 31, 2011, this sale was accounted for under the deposit method, as it lacked adequate initial investment by the buyer to qualify as a sale transaction. Accordingly, the Partnership recorded deferred revenues of $145,000 (cash portion of the sales price received less $5,000 of expenses incurred in connection with the assignment) and excluded the promissory note from its assets at December 31, 2011. During the year ended December 31, 2012, the Partnership paid approximately $43,000 of New Jersey taxes associated with the sale, which was recognized as a reduction to the gain. During the year ended December 31, 2012, the Partnership received approximately $3,562,000 in payment of the note receivable of approximately $3,550,000 and accrued interest of approximately $12,000. The Partnership recognized a gain from sale of limited partnership interest of approximately $3,652,000 and interest income of approximately $12,000 during the year ended December 31, 2012. | |||||||||
During September 2013, the Partnership entered into an Assignment and Assumption Agreement to assign its limited partnership interest in Michigan Beach to a third party for a total amount of $10.00. Additionally, during September 2013, the Partnership entered into a Loan Purchase Agreement with the same third party, to sell the second mortgage held by the Partnership for an amount equal to the outstanding principal on the Loan. As of December 31, 2013, the outstanding principal balance on the Loan was $3,596,000. The Partnership's investment balance in Michigan Beach was reduced to zero. The assignment and the Loan purchase are subject to i) the consent of the United States Department of Housing and Urban Development and ii) the consent of Midland Loan Services, Inc. If either condition was not met prior to December 31, 2013, the Assignment Agreement and the Loan Agreement would terminate. All parties have agreed to extend and reinstate the loan agreement. Negotiations are ongoing at this time. An extension is expected to be signed in the second quarter of 2014. In the event that the closing does not timely occur due to the default by Assignee of its obligations under the Assignment Agreement or the Loan Agreement, then the Partnership will be entitled to keep the $1,000 escrow deposit made by Assignee in connection with the Loan Agreement. In the event that the closing does not timely occur due to the default by the Partnership, then the rights and obligations of both parties under both agreements terminate, except for certain indemnification rights. | |||||||||
As of December 31, 2013 and 2012, the investment balance in one of the two and three of the four Local Partnerships, respectively, had been reduced to zero. The Partnership’s remaining investment balance relates to the mortgage note receivable, which is discussed in “Note 3 – Mortgage Note Receivable”. | |||||||||
At times, advances are made to Local Partnerships. Advances made by the Partnership to the individual Local Partnerships are considered part of the Partnership’s investment in limited partnerships. Advances made to Local Partnerships in which the investment balance has been reduced to zero are charged to expense. The Partnership made advances of approximately $1,344,000 to Michigan Beach during the year ended December 31, 2013, for deferred capital needs. Subsequent to December 31, 2013, the Partnership advanced approximately $89,000. While not obligated to make advances to any of the Local Partnerships, the Partnership may make future advances in order to protect its economic investment in the Local Partnerships. | |||||||||
The difference between the investment per the accompanying balance sheets at December 31, 2013 and 2012 and the equity per the Local Partnerships' condensed combined financial statements is due primarily to cumulative unrecognized equity in losses of certain Local Partnerships, costs capitalized to the investment account, and cumulative distributions recognized as income. | |||||||||
The Partnership’s value of its investments and its equity in the income/loss and/or distributions from the Local Partnerships are, for certain Local Partnerships, individually, not material to the overall financial position of the Partnership. The financial information from the unaudited condensed combined financial statements of such Local Partnerships at December 31, 2013 and 2012 and for each of the two years in the period then ended is presented below. The Partnership’s value of its investment in Michigan Beach Limited Partnership, (the “Material Investee”) is considered material to the Partnership’s financial position and amounts included below for the Material Investee are included on an audited basis. | |||||||||
The following are estimated unaudited condensed combined statements of operations for the years ended December 31, 2013 and 2012 for the Local Partnerships in which the Partnership has investments. The 2013 and 2012 amounts exclude Jamestown and Virginia Park, for which the Partnership assigned its limited partnership interest in October 2013; The 2012 amounts exclude Countryside Place, for which the Partnership sold its limited partnership interest in April 2012. | |||||||||
Condensed Combined Balance Sheets of the Local Partnerships | |||||||||
(in thousands) | |||||||||
31-Dec-13 | |||||||||
Assets: | Unaudited | Material Investee | Total | ||||||
Land | $ 112 | $ 1,010 | $1,122 | ||||||
Building and improvements | 4,109 | 9,751 | 13,860 | ||||||
Accumulated depreciation | (2,355) | (4,393) | (6,748) | ||||||
Other assets | 67 | 588 | 655 | ||||||
Total assets | $1,933 | $ 6,956 | $8,889 | ||||||
Liabilities and Partners Deficit: | |||||||||
Liabilities: | |||||||||
Mortgage notes payable and interest | $2,047 | $ 12,375 | $14,422 | ||||||
Other liabilities | 284 | 7,093 | 7,377 | ||||||
Partners’ deficit | (398) | (12,512) | (12,910) | ||||||
Total liabilities and partners' deficit | $1,933 | $ 6,956 | $ 8,889 | ||||||
31-Dec-12 | |||||||||
Assets | Unaudited | Material Investee | Total | ||||||
Land | $ 185 | $ 843 | $ 1,028 | ||||||
Building and improvements | 4,025 | 8,222 | 12,247 | ||||||
Accumulated depreciation | (2,241) | (3,967) | (6,208) | ||||||
Other assets | 58 | 736 | 794 | ||||||
Total assets | $2,027 | $ 5,834 | $ 7,861 | ||||||
Liabilities and Partners Deficit: | |||||||||
Liabilities: | |||||||||
Mortgage notes payable | $2,047 | $ 9,073 | $11,120 | ||||||
Other liabilities | 286 | 9,032 | 9,318 | ||||||
Partners’ deficit | (306) | (12,271) | (12,577) | ||||||
Total liabilities and partners' deficit | $2,027 | $ 5,834 | $7,861 | ||||||
Condensed Combined Results of Operations of the Local Partnerships | |||||||||
(in thousands) | |||||||||
For the year Ended December 31, 2013 | For the year Ended December 31, 2012 | ||||||||
Unaudited | Material Investee | Total | Unaudited | Material Investee | Total | ||||
Rental and other revenue | $ 430 | $ 2,433 | $2,863 | $ 459 | $2,288 | $2,747 | |||
Expenses: | |||||||||
Operating expenses | 383 | 588 | 971 | 440 | 1,837 | 2,277 | |||
Interest and entity | |||||||||
expenses | 24 | 430 | 454 | -- | (15) | (15) | |||
Depreciation and amortization | 115 | 1,659 | 1,774 | 109 | 417 | 526 | |||
Total expenses | 522 | 2,677 | 3,199 | 549 | 2,239 | 2,788 | |||
Income (loss) from continuing operations | $ (92) | $ (244) | $ (336) | $ (90) | $ 49 | $ (41) | |||
Real Estate and Accumulated Depreciation of Local Partnerships | |||||||||
The following tables exclude the Local Partnerships sold in 2013 and 2012 as described above. | |||||||||
(1) Schedule of Encumbrances and Investment Properties (all amounts unaudited except for those amounts relative to the Material Investee and are the gross amounts at which carried at December 31, 2013) (in thousands): | |||||||||
Description | Encumbrances | Land | Buildings And Related Personal Property | Total | Accumulated Depreciation | ||||
Lincoln Grove | $ 2,047 | $ 112 | $ 4,109 | $ 4,221 | $ 2,355 | ||||
Michigan Beach | 12,375 | 1,010 | 9,751 | 10,761 | 4,393 | ||||
Total | $ 14,422 | $1,122 | $ 13,860 | $ 14,982 | $ 6,748 | ||||
(2) Reconciliation of real estate (all amounts unaudited except for those amounts relative to the Material Investee) (in thousands): | |||||||||
Year Ended December 31, 2013 | Year Ended December 31, 2012 | ||||||||
Unaudited | Material Investee | Total | Unaudited | Material Investee | Total | ||||
Real estate: | |||||||||
Balance at beginning of year | $4,210 | $9,065 | $13,275 | $4,190 | $8,557 | $12,747 | |||
Improvements | 11 | 1,696 | 1,707 | 20 | 508 | 528 | |||
Balance at end of year | $4,221 | $10,761 | $14,982 | $4,210 | $9,065 | $13,275 | |||
(3) Reconciliation of accumulated depreciation (all amounts unaudited except for those amounts relative to the Material Investee) (in thousands): | |||||||||
Year Ended December 31, 2013 | Year Ended December 31, 2012 | ||||||||
Unaudited | Material Investee | Total | Unaudited | Material Investee | Total | ||||
Accumulated depreciation: | |||||||||
Balance at beginning of year | $ 2,241 | $ 3,967 | $6,208 | $ 2,133 | $ 3,555 | $5,688 | |||
Depreciation expense | 114 | 426 | 540 | 108 | 412 | 520 | |||
Balance at end of year | $ 2,355 | $ 4,393 | $6,748 | $ 2,241 | $ 3,967 | $6,208 | |||
An affiliate of the General Partner is currently the Local Operating General Partner in one of the Partnership’s four Local Partnerships included above, and a former affiliate received property management fees of approximately 5 percent of gross revenues from the same Local Partnership (See “Note 4 – Transactions with Affiliated Parties”). |
Note_3_Mortgage_Note_Receivabl
Note 3 - Mortgage Note Receivable | 12 Months Ended | ||
Dec. 31, 2013 | |||
Notes | ' | ||
Note 3 - Mortgage Note Receivable | ' | ||
Note 3 – Mortgage Note Receivable | |||
On May 30, 2006, the Partnership purchased the second mortgage for a Local Partnership, Michigan Beach, from the second mortgage holder, PAMI Midatlantic, LLC (“PAMI”) for a purchase price of $ 4,320,000. The second mortgage had a principal balance of approximately $ 3,596,000 and accrued interest outstanding at the time of the purchase. PAMI had filed an action for foreclosure and the appointment of a receiver for the alleged failure to make surplus cash payments and provide required financial reporting. As a result of the purchase, the Partnership was substituted in place of PAMI in the foreclosure action and then the Partnership dismissed the foreclosure action with prejudice on June 9, 2006. The Partnership is the sole limited partner in Michigan Beach. | |||
The second mortgage accrues interest at a fixed rate of 6.11%. Semiannual payments from 50% of surplus cash are required and the note matures in July of 2031. There is an option to the noteholder to accelerate maturity of the second mortgage after October of 2008. There have been no payments made on the loan. The Partnership recognized approximately $55,000 and $141,000 in equity in loss from Michigan Beach during the years ended December 31, 2013 and 2012, respectively, and reduced the carrying value of the mortgage note receivable. With respect to the second mortgage from Michigan Beach, the Partnership has fully reserved any accrued interest. | |||
The following is a summary of the mortgage note receivable activity for the years ended December 31, 2013 and 2012 (in thousands): | |||
2013 | 2012 | ||
Mortgage note receivable balance, beginning of year | $ 3,533 | $ 3,674 | |
Equity in losses of Local Partnership | (55) | (141) | |
Mortgage note receivable balance, end of year | $ 3,478 | $ 3,533 |
Note_4_Transactions_With_Affil
Note 4 - Transactions With Affiliated Parties | 12 Months Ended |
Dec. 31, 2013 | |
Notes | ' |
Note 4 - Transactions With Affiliated Parties | ' |
Note 4 – Transactions with Affiliated Parties | |
Under the terms of its Partnership Agreement, the Partnership is obligated to the General Partner for the following fees: | |
(a) An annual Partnership management fee in an amount equal to 0.5 percent of invested assets (as defined in the Partnership Agreement) at the beginning of the year is payable to the General Partner. For the years ended December 31, 2013 and 2012, partnership management fees in the amount of approximately $107,000, for each year, were recorded as an expense. | |
(b) A property disposition fee is payable to the General Partner in an amount equal to the lesser of (i) one-half of the competitive real estate commission that would have been charged by unaffiliated third parties providing comparable services in the area where the apartment complex is located, or (ii) 3 percent of the sale price received in connection with the sale or disposition of the apartment complex or local partnership interest, but in no event will the property disposition fee and all amounts payable to unaffiliated real estate brokers in connection with any such sale exceed in the aggregate, the lesser of the competitive rate (as described above) or 6 percent of such sale price. Receipt of the property disposition fee will be subordinated to the distribution of sale or refinancing proceeds by the Partnership until the limited partners have received distributions of sale or refinancing proceeds in an aggregate amount equal to (i) their 6 percent priority return for any year not theretofore satisfied (as defined in the Partnership Agreement) and (ii) an amount equal to the aggregate adjusted investment (as defined in the Partnership Agreement) of the limited partners. No disposition fees have been paid or accrued. | |
(c) The Partnership reimburses NAPICO for certain expenses. The reimbursement to NAPICO was approximately $29,000 for each of the years ended December 31, 2013 and 2012, respectively, and is included in general and administrative expenses. | |
NTC-II is typically either a special limited partner or an administrative general partner in each Local Partnership in which the Partnership has an investment. | |
A former affiliate of the General Partner managed one property owned by a Local Partnership during the year ended December 31, 2012. The Local Partnership paid the affiliate property management fees in the amount of five percent of its gross rental revenues and data processing fees. The amounts paid were approximately $91,000 for the year ended December 31, 2012. On October 31, 2012, the former affiliate ceased to manage the property and management was transferred to a third party. | |
The General Partner is not obligated to advance funds to the Partnership for operations or to fund Partnership advances to Local Partnerships, but may voluntarily do so from time to time. There were no advances received by the Partnership during the years ended December 31, 2013 and 2012. The Partnership may receive future advances of funds from the General Partner although the General Partner is not obligated to provide such advances. | |
Bethesda and its affiliates owned 397 limited partnership interests (the "Units") in the Partnership representing .55% of the outstanding Units in the Partnership at December 31, 2013. It is possible that Bethesda or its affiliates will acquire additional Units in the Partnership either through private purchases or tender offers. Pursuant to the Partnership Agreement, unitholders holding a majority of the Units are entitled to take action with respect to a variety of matters that include, but are not limited to, voting on certain amendments to the Partnership Agreement and voting to remove the General Partner. Although the General Partner owes fiduciary duties to the limited partners of the Partnership, the General Partner also owes fiduciary duties to Bethesda as its sole stockholder. As a result, the duties of the General Partner, as general partner, to the Partnership and its limited partners may come into conflict with the duties of the General Partner to Bethesda as its sole stockholder. |
Note_5_Income_Taxes
Note 5 - Income Taxes | 12 Months Ended | ||
Dec. 31, 2013 | |||
Notes | ' | ||
Note 5 - Income Taxes | ' | ||
Note 5 - Income Taxes | |||
The Partnership is not taxed on its income. The partners are taxed in their individual capacities based upon their distributive share of the Partnership's taxable income or loss and are allowed the benefits to be derived from off-setting their distributive share of the tax losses against taxable income from other sources subject to passive loss limitations. The taxable income or loss differs from amounts included in the statements of operations because different methods are used in determining the losses of the Local Partnerships as discussed below. The taxable income or loss is allocated to the partner groups in accordance with Section 704(b) of the Internal Revenue Code and therefore is not necessarily proportionate to the interest percentage owned. | |||
A reconciliation between the Partnership’s reported net income and the net income (loss) per tax return follows (in thousands, except per limited partnership interest): | |||
Years Ended December 31, | |||
2013 | 2012 | ||
Net income (loss) per financial statements | (1,633) | $ 3,300 | |
Sale of partnership interest | 0 | (3,612) | |
Other | 0 | (177) | |
Investment in Local Partnerships | 5,068 | (289) | |
Net income (loss) per tax return | $ 3,435 | $ (778) | |
Net income (loss) per limited partnership interest | $ 47.22 | $ (53.36) | |
The following is a reconciliation between the Partnership’s reported amounts and the Federal tax basis of net assets at December 31, 2013 and 2012 (in thousands): | |||
2013 | 2012 | ||
Net assets as reported | $ 7,258 | $ 8,891 | |
Add (deduct): | |||
Deferred offering costs | 9,367 | 9,367 | |
Investment in Local Partnerships | (8,000) | (13,392) | |
Other | 3,349 | 3,673 | |
Net assets – Federal tax basis | $ 11,974 | $ 8,539 | |
The Partnership was subject to a New Jersey tax based upon the number of resident and non-resident limited partners and apportionment of income related to the Partnership’s investment in certain Local Partnerships. For the year ended December 31, 2012 the expense related to this tax is reflected in tax expense in the accompanying statements of operations. During the year ended December 31, 2012, the Partnership paid approximately $66,000 as a required deposit for estimated 2012 New Jersey taxes, which was based on half of the previous year’s taxes. However, the Partnership’s estimate of the actual tax due for 2012 was approximately $12,000. The remaining balance paid of approximately $54,000 is reflected as another asset on the accompanying balance sheet at December 31, 2013 and 2012. As a result of the sale of Countryside during 2012, the Partnership is no longer subject to pay New Jersey taxes. |
Note_6_Contingencies
Note 6 - Contingencies | 12 Months Ended |
Dec. 31, 2013 | |
Notes | ' |
Note 6 - Contingencies | ' |
Note 6 - Contingencies | |
The General Partner is involved in various lawsuits arising from transactions in the ordinary course of business. In the opinion of management and the General Partner, the claims will not result in any material liability to the Partnership. |
Note_7_Subsequent_Events
Note 7 - Subsequent Events | 12 Months Ended |
Dec. 31, 2013 | |
Notes | ' |
Note 7 - Subsequent Events | ' |
Note 7 - Subsequent Events | |
The Partnership’s management evaluated subsequent events through the time this Annual Report on Form 10-K was filed. |
Note_1_Organization_and_Summar1
Note 1 - Organization and Summary of Significant Accounting Policies: Organization (Policies) | 12 Months Ended |
Dec. 31, 2013 | |
Policies | ' |
Organization | ' |
Organization | |
National Tax Credit Investors II (“NTCI II” or the “Partnership”) is a limited partnership formed under the California Revised Local Partnership Act as of January 12, 1990. The Partnership was formed to invest primarily in other limited partnerships (“Local Partnerships”) which own and operate multifamily housing complexes that are eligible for low income housing federal income tax credits (the “Housing Tax Credit”). The general partner of the Partnership is National Partnership Investments, LLC (the “General Partner” or “NAPICO”), a California limited liability company. The General Partner is a subsidiary of Bethesda Holdings II, LLC, a privately held real estate asset management company (“Bethesda”). Bethesda acquired the General Partner on December 19, 2012, pursuant to an option agreement with Aimco/Bethesda Holdings, Inc., a subsidiary of Apartment Investment and Management Company (“Aimco”), a publicly traded real estate investment trust. The business of NTCI II is conducted primarily by NAPICO. The Partnership shall continue in full force and effect until December 31, 2030, unless terminated earlier pursuant to the Partnership Agreement or law. | |
The General Partner has a one percent interest in operating profits and losses of the Partnership. The limited partners will be allocated the remaining 99 percent interest in proportion to their respective investments. | |
Upon total or partial liquidation of the Partnership or the disposition or partial disposition of a project or project interest and distribution of the proceeds, the General Partner will be entitled to a property disposition fee as mentioned in the partnership agreement. The limited partners will have a priority item equal to their invested capital plus 6 percent priority return as defined in the partnership agreement. This property disposition fee may accrue but shall not be paid until the limited partners have received distributions equal to 100 percent of their capital contributions plus the 6 percent priority return. No disposition fees have been paid or accrued. | |
At December 31, 2013 and 2012, the Partnership had outstanding 72,017 and 72,032 limited partnership interests, respectively. |
Note_1_Organization_and_Summar2
Note 1 - Organization and Summary of Significant Accounting Policies: Basis of Presentation (Policies) | 12 Months Ended |
Dec. 31, 2013 | |
Policies | ' |
Basis of Presentation | ' |
Basis of Presentation | |
The accompanying financial statements have been prepared in conformity with accounting principles generally accepted in the United States. |
Note_1_Organization_and_Summar3
Note 1 - Organization and Summary of Significant Accounting Policies: Cash and Cash Equivalents (Policies) | 12 Months Ended |
Dec. 31, 2013 | |
Policies | ' |
Cash and Cash Equivalents | ' |
Cash and Cash Equivalents | |
Cash and cash equivalents include cash on hand and in banks. At certain times, the amount of cash deposited at a bank may exceed the limit on insured deposits. The entire cash balance at December 31, 2012 was maintained by an affiliated management company on behalf of affiliated entities in a cash concentration account. In 2013 the affiliated management company maintained separate cash accounts with an FDIC insured bank for each of its affiliated entities including National Tax Credit Investors II. |
Note_1_Organization_and_Summar4
Note 1 - Organization and Summary of Significant Accounting Policies: Method of Accounting For Investment in Local Partnerships (Policies) | 12 Months Ended |
Dec. 31, 2013 | |
Policies | ' |
Method of Accounting For Investment in Local Partnerships | ' |
Method of Accounting for Investments in Local Partnerships | |
The investments in Local Partnerships are accounted for using the equity method. Acquisition fees, selection fees and other costs related to the acquisition of the projects have been capitalized as part of the investment account and are being amortized by the straight line method over the estimated lives of the underlying assets, which is generally 30 years. |
Note_1_Organization_and_Summar5
Note 1 - Organization and Summary of Significant Accounting Policies: Use of Estimates (Policies) | 12 Months Ended |
Dec. 31, 2013 | |
Policies | ' |
Use of Estimates | ' |
Use of Estimates | |
The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates. |
Note_1_Organization_and_Summar6
Note 1 - Organization and Summary of Significant Accounting Policies: Net Income Per Limited Partnership Interest (Policies) | 12 Months Ended |
Dec. 31, 2013 | |
Policies | ' |
Net Income Per Limited Partnership Interest | ' |
Net Income Per Limited Partnership Interest | |
Net income per limited partnership interest was computed by dividing the limited partners' share of net income by the number of limited partnership interests outstanding at the beginning of the year. The number of limited partnership interests used was 72,032 and 72,205 for the years ended December 31, 2013 and 2012, respectively. |
Note_1_Organization_and_Summar7
Note 1 - Organization and Summary of Significant Accounting Policies: Abandoned Interests (Policies) | 12 Months Ended |
Dec. 31, 2013 | |
Policies | ' |
Abandoned Interests | ' |
Abandoned Interests | |
During 2013 and 2012, the number of limited partnership interests decreased by 15 and 173 units, respectively, due to limited partners abandoning their interests. In abandoning his or her partnership interests, a limited partner relinquishes all right, title and interest in the Partnership as of the date of the abandonment. |
Note_1_Organization_and_Summar8
Note 1 - Organization and Summary of Significant Accounting Policies: Mortgage Note Receivable (Policies) | 12 Months Ended |
Dec. 31, 2013 | |
Policies | ' |
Mortgage Note Receivable | ' |
Mortgage Note Receivable | |
The Partnership reviews its mortgage note receivable whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. The Partnership has recorded its mortgage note receivable at December 31, 2013 and December 31, 2012 at the amount at which the Partnership ultimately expects to receive. No impairment was recognized during the years ended December 31, 2013 or 2012. See “Note 3 – Mortgage Note Receivable” for further information. |
Note_1_Organization_and_Summar9
Note 1 - Organization and Summary of Significant Accounting Policies: Impairment of Long-lived Assets (Policies) | 12 Months Ended |
Dec. 31, 2013 | |
Policies | ' |
Impairment of Long-lived Assets | ' |
Impairment of Long-Lived Assets | |
The Partnership reviews long-lived assets to determine if there has been any impairment whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. If the sum of the expected future cash flows is less than the carrying amount of the assets, the Partnership recognizes an impairment loss. There were no impairment losses recognized during the years ended December 31, 2013 and 2012. |
Recovered_Sheet1
Note 1 - Organization and Summary of Significant Accounting Policies: Fair Value of Financial Instruments (Policies) | 12 Months Ended |
Dec. 31, 2013 | |
Policies | ' |
Fair Value of Financial Instruments | ' |
Fair Value of Financial Instruments | |
Financial Accounting Standards Board Accounting Standards Codification (“ASC”) Topic 825, “Financial Instruments”, requires disclosure of fair value information about financial instruments, whether or not recognized in the balance sheet, for which it is practicable to estimate fair value. Fair value is defined as the amount at which the instruments could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale. At December 31, 2013, the Partnership believes that the carrying amount of other assets and liabilities reported on the balance sheet that require such disclosure approximated their fair value due to the short-term maturity of these instruments. |
Recovered_Sheet2
Note 1 - Organization and Summary of Significant Accounting Policies: Segment Reporting (Policies) | 12 Months Ended |
Dec. 31, 2013 | |
Policies | ' |
Segment Reporting | ' |
Segment Reporting | |
ASC Topic 280-10, “Segment Reporting”, established standards for the way that public business enterprises report information about operating segments in annual financial statements and requires that those enterprises report selected information about operating segments in interim financial reports. ASC Topic 280-10 also established standards for related disclosures about products and services, geographic areas, and major customers. As defined in ASC Topic 280-10, the Partnership has only one reportable segment. |
Recovered_Sheet3
Note 1 - Organization and Summary of Significant Accounting Policies: Variable Interest Entities (Policies) | 12 Months Ended |
Dec. 31, 2013 | |
Policies | ' |
Variable Interest Entities | ' |
Variable Interest Entities | |
The Partnership consolidates any variable interest entities in which the Partnership holds a variable interest and is the primary beneficiary. Generally, a variable interest entity, or VIE, is an entity with one or more of the following characteristics: (a) the total equity investment at risk is not sufficient to permit the entity to finance its activities without additional subordinated financial support; (b) as a group the holders of the equity investment at risk lack (i) the ability to make decisions about an entity’s activities through voting or similar rights, (ii) the obligation to absorb the expected losses of the entity, or (iii) the right to receive the expected residual returns of the entity; or (c) the equity investors have voting rights that are not proportional to their economic interests and substantially all of the entity’s activities either involve, or are conducted on behalf of, an investor that has disproportionately few voting rights. The primary beneficiary of a VIE is generally the entity that has (a) the power to direct the activities of the VIE that most significantly impact the VIE’s economic performance, and (b) the obligation to absorb losses or the right to receive benefits that could potentially be significant to the VIE. | |
In determining whether it is the primary beneficiary of a VIE, the Partnership considers qualitative and quantitative factors, including, but not limited to: which activities most significantly impact the VIE’s economic performance and which party controls such activities; the amount and characteristics of the Partnership’s investment; the obligation or likelihood for the Partnership or other investors to provide financial support; and the similarity with and significance to the business activities of the Partnership and the other investors. Significant judgments related to these determinations include estimates about the current and future fair values and performance of real estate held by these VIEs and general market conditions. | |
At December 31, 2013 and 2012, the Partnership held variable interests in two and four VIEs, respectively, for which the Partnership was not the primary beneficiary. The Partnership has concluded, based on its qualitative consideration of the partnership agreement, the partnership structure and the role of the general partner in each of the Local Partnerships, that the general partner of each of the Local Partnerships is the primary beneficiary of the respective Local Partnership. In making this determination, the Partnership considered the following factors: | |
· the general partners conduct and manage the business of the Local Partnerships; | |
· the general partners have the responsibility for and sole discretion over selecting a property management agent for the Local Partnerships’ underlying real estate properties; | |
· the general partners are responsible for approving operating and capital budgets for the properties owned by the Local Partnerships; | |
· the general partners are obligated to fund any recourse obligations of the Local Partnerships; | |
· the general partners are authorized to borrow funds on behalf of the Local Partnerships; and | |
· the Partnership, as a limited partner in each of the Local Partnerships, does not have the ability to direct or otherwise significantly influence the activities of the Local Partnerships that most significantly impact such entities’ economic performance. | |
The two VIEs at December 31, 2013 consisted of Local Partnerships that were directly engaged in the ownership and management of two apartment properties with a total of 355 units. The Partnership is involved with those VIEs as a non-controlling limited partner equity holder. The Partnership’s maximum exposure to loss as a result of its involvement with the unconsolidated VIEs is limited to the Partnership’s recorded investments in and receivables from these VIEs, which was approximately $3,478,000 and $3,533,000 at December 31, 2013 and 2012, respectively. The Partnership may be subject to additional losses to the extent of any financial support that the Partnership voluntarily provides in the future. |
Note_2_Investments_in_and_Adva1
Note 2 - Investments in and Advances To Local Partnerships: Condensed Combined Balance Sheets of the Local Partnerships (Tables) | 12 Months Ended | |||
Dec. 31, 2013 | ||||
Tables/Schedules | ' | |||
Condensed Combined Balance Sheets of the Local Partnerships | ' | |||
Condensed Combined Balance Sheets of the Local Partnerships | ||||
(in thousands) | ||||
31-Dec-13 | ||||
Assets: | Unaudited | Material Investee | Total | |
Land | $ 112 | $ 1,010 | $1,122 | |
Building and improvements | 4,109 | 9,751 | 13,860 | |
Accumulated depreciation | (2,355) | (4,393) | (6,748) | |
Other assets | 67 | 588 | 655 | |
Total assets | $1,933 | $ 6,956 | $8,889 | |
Liabilities and Partners Deficit: | ||||
Liabilities: | ||||
Mortgage notes payable and interest | $2,047 | $ 12,375 | $14,422 | |
Other liabilities | 284 | 7,093 | 7,377 | |
Partners’ deficit | (398) | (12,512) | (12,910) | |
Total liabilities and partners' deficit | $1,933 | $ 6,956 | $ 8,889 | |
31-Dec-12 | ||||
Assets | Unaudited | Material Investee | Total | |
Land | $ 185 | $ 843 | $ 1,028 | |
Building and improvements | 4,025 | 8,222 | 12,247 | |
Accumulated depreciation | (2,241) | (3,967) | (6,208) | |
Other assets | 58 | 736 | 794 | |
Total assets | $2,027 | $ 5,834 | $ 7,861 | |
Liabilities and Partners Deficit: | ||||
Liabilities: | ||||
Mortgage notes payable | $2,047 | $ 9,073 | $11,120 | |
Other liabilities | 286 | 9,032 | 9,318 | |
Partners’ deficit | (306) | (12,271) | (12,577) | |
Total liabilities and partners' deficit | $2,027 | $ 5,834 | $7,861 |
Note_2_Investments_in_and_Adva2
Note 2 - Investments in and Advances To Local Partnerships: Estimated condensed combined statements of operations for Local Partnerships (Tables) | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Tables/Schedules | ' | |||||||
Estimated condensed combined statements of operations for Local Partnerships | ' | |||||||
Condensed Combined Results of Operations of the Local Partnerships | ||||||||
(in thousands) | ||||||||
For the year Ended December 31, 2013 | For the year Ended December 31, 2012 | |||||||
Unaudited | Material Investee | Total | Unaudited | Material Investee | Total | |||
Rental and other revenue | $ 430 | $ 2,433 | $2,863 | $ 459 | $2,288 | $2,747 | ||
Expenses: | ||||||||
Operating expenses | 383 | 588 | 971 | 440 | 1,837 | 2,277 | ||
Interest and entity | ||||||||
expenses | 24 | 430 | 454 | -- | (15) | (15) | ||
Depreciation and amortization | 115 | 1,659 | 1,774 | 109 | 417 | 526 | ||
Total expenses | 522 | 2,677 | 3,199 | 549 | 2,239 | 2,788 | ||
Income (loss) from continuing operations | $ (92) | $ (244) | $ (336) | $ (90) | $ 49 | $ (41) | ||
Note_2_Investments_in_and_Adva3
Note 2 - Investments in and Advances To Local Partnerships: Schedule of Encumbrances and Investment Properties (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Tables/Schedules | ' | ||||||||
Schedule of Encumbrances and Investment Properties | ' | ||||||||
(1) Schedule of Encumbrances and Investment Properties (all amounts unaudited except for those amounts relative to the Material Investee and are the gross amounts at which carried at December 31, 2013) (in thousands): | |||||||||
Description | Encumbrances | Land | Buildings And Related Personal Property | Total | Accumulated Depreciation | ||||
Lincoln Grove | $ 2,047 | $ 112 | $ 4,109 | $ 4,221 | $ 2,355 | ||||
Michigan Beach | 12,375 | 1,010 | 9,751 | 10,761 | 4,393 | ||||
Total | $ 14,422 | $1,122 | $ 13,860 | $ 14,982 | $ 6,748 | ||||
Note_2_Investments_in_and_Adva4
Note 2 - Investments in and Advances To Local Partnerships: Schecule of Reconciliation of real estate (Tables) | 12 Months Ended | ||||||
Dec. 31, 2013 | |||||||
Tables/Schedules | ' | ||||||
Schecule of Reconciliation of real estate | ' | ||||||
(2) Reconciliation of real estate (all amounts unaudited except for those amounts relative to the Material Investee) (in thousands): | |||||||
Year Ended December 31, 2013 | Year Ended December 31, 2012 | ||||||
Unaudited | Material Investee | Total | Unaudited | Material Investee | Total | ||
Real estate: | |||||||
Balance at beginning of year | $4,210 | $9,065 | $13,275 | $4,190 | $8,557 | $12,747 | |
Improvements | 11 | 1,696 | 1,707 | 20 | 508 | 528 | |
Balance at end of year | $4,221 | $10,761 | $14,982 | $4,210 | $9,065 | $13,275 |
Note_2_Investments_in_and_Adva5
Note 2 - Investments in and Advances To Local Partnerships: Schedule of Reconciliation of accumulated depreciation (Tables) | 12 Months Ended | ||||||
Dec. 31, 2013 | |||||||
Tables/Schedules | ' | ||||||
Schedule of Reconciliation of accumulated depreciation | ' | ||||||
(3) Reconciliation of accumulated depreciation (all amounts unaudited except for those amounts relative to the Material Investee) (in thousands): | |||||||
Year Ended December 31, 2013 | Year Ended December 31, 2012 | ||||||
Unaudited | Material Investee | Total | Unaudited | Material Investee | Total | ||
Accumulated depreciation: | |||||||
Balance at beginning of year | $ 2,241 | $ 3,967 | $6,208 | $ 2,133 | $ 3,555 | $5,688 | |
Depreciation expense | 114 | 426 | 540 | 108 | 412 | 520 | |
Balance at end of year | $ 2,355 | $ 4,393 | $6,748 | $ 2,241 | $ 3,967 | $6,208 |
Note_3_Mortgage_Note_Receivabl1
Note 3 - Mortgage Note Receivable: Summary of mortgage note receivable activity (Tables) | 12 Months Ended | ||
Dec. 31, 2013 | |||
Tables/Schedules | ' | ||
Summary of mortgage note receivable activity | ' | ||
The following is a summary of the mortgage note receivable activity for the years ended December 31, 2013 and 2012 (in thousands): | |||
2013 | 2012 | ||
Mortgage note receivable balance, beginning of year | $ 3,533 | $ 3,674 | |
Equity in losses of Local Partnership | (55) | (141) | |
Mortgage note receivable balance, end of year | $ 3,478 | $ 3,533 |
Note_5_Income_Taxes_Reconcilia
Note 5 - Income Taxes: Reconciliation between the Partnership's reported net income and the net income (loss) per tax return (Tables) | 12 Months Ended | ||
Dec. 31, 2013 | |||
Tables/Schedules | ' | ||
Reconciliation between the Partnership's reported net income and the net income (loss) per tax return | ' | ||
A reconciliation between the Partnership’s reported net income and the net income (loss) per tax return follows (in thousands, except per limited partnership interest): | |||
Years Ended December 31, | |||
2013 | 2012 | ||
Net income (loss) per financial statements | (1,633) | $ 3,300 | |
Sale of partnership interest | 0 | (3,612) | |
Other | 0 | (177) | |
Investment in Local Partnerships | 5,068 | (289) | |
Net income (loss) per tax return | $ 3,435 | $ (778) | |
Net income (loss) per limited partnership interest | $ 47.22 | $ (53.36) |
Note_5_Income_Taxes_Reconcilia1
Note 5 - Income Taxes: Reconciliation between the Partnership's reported amounts and the Federal tax basis of net assets (Tables) | 12 Months Ended | ||
Dec. 31, 2013 | |||
Tables/Schedules | ' | ||
Reconciliation between the Partnership's reported amounts and the Federal tax basis of net assets | ' | ||
The following is a reconciliation between the Partnership’s reported amounts and the Federal tax basis of net assets at December 31, 2013 and 2012 (in thousands): | |||
2013 | 2012 | ||
Net assets as reported | $ 7,258 | $ 8,891 | |
Add (deduct): | |||
Deferred offering costs | 9,367 | 9,367 | |
Investment in Local Partnerships | (8,000) | (13,392) | |
Other | 3,349 | 3,673 | |
Net assets – Federal tax basis | $ 11,974 | $ 8,539 |
Recovered_Sheet4
Note 1 - Organization and Summary of Significant Accounting Policies: Organization (Details) | Dec. 31, 2013 | Dec. 31, 2012 |
Details | ' | ' |
OutstandingLimitedPartnershipInterests | 72,017 | 72,032 |
Recovered_Sheet5
Note 1 - Organization and Summary of Significant Accounting Policies: Net Income Per Limited Partnership Interest (Details) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Details | ' | ' |
Number of limited partnership interests | 72,032 | 72,205 |
Recovered_Sheet6
Note 1 - Organization and Summary of Significant Accounting Policies: Impairment of Long-lived Assets (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Details | ' | ' |
Impairment Losses | $0 | $0 |
Note_2_Investments_in_and_Adva6
Note 2 - Investments in and Advances To Local Partnerships: Condensed Combined Balance Sheets of the Local Partnerships (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
In Thousands, unless otherwise specified | |||
Land | $1,122 | $1,028 | ' |
Buildings and Improvements, Gross | 13,860 | 12,247 | ' |
SEC Schedule III, Real Estate Accumulated Depreciation | -6,748 | -6,208 | -5,688 |
Other Partnership Assets | 655 | 794 | ' |
Partnership Assets | 8,889 | 7,861 | ' |
Other Notes Payable | 14,422 | 11,120 | ' |
Other Liabilities | 7,377 | 9,318 | ' |
Partnership Equity (Deficit) | -12,910 | -12,577 | ' |
Partnership Liabilities and Equity (Deficit) | 8,889 | 7,861 | ' |
Unaudited | ' | ' | ' |
Land | 112 | 185 | ' |
Buildings and Improvements, Gross | 4,109 | 4,025 | ' |
SEC Schedule III, Real Estate Accumulated Depreciation | -2,355 | -2,241 | -2,133 |
Other Partnership Assets | 67 | 58 | ' |
Partnership Assets | 1,933 | 2,027 | ' |
Other Notes Payable | 2,047 | 2,047 | ' |
Other Liabilities | 284 | 286 | ' |
Partnership Equity (Deficit) | -398 | -306 | ' |
Partnership Liabilities and Equity (Deficit) | 1,933 | 2,027 | ' |
Material Investee | ' | ' | ' |
Land | 1,010 | 843 | ' |
Buildings and Improvements, Gross | 9,751 | 8,222 | ' |
SEC Schedule III, Real Estate Accumulated Depreciation | -4,393 | -3,967 | -3,555 |
Other Partnership Assets | 588 | 736 | ' |
Partnership Assets | 6,956 | 5,834 | ' |
Other Notes Payable | 12,375 | 9,073 | ' |
Other Liabilities | 7,093 | 9,032 | ' |
Partnership Equity (Deficit) | -12,512 | -12,271 | ' |
Partnership Liabilities and Equity (Deficit) | $6,956 | $5,834 | ' |
Note_2_Investments_in_and_Adva7
Note 2 - Investments in and Advances To Local Partnerships: Estimated condensed combined statements of operations for Local Partnerships (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Rental Income, Nonoperating | $2,863 | $2,747 |
Expenses | ' | ' |
Operating Costs and Expenses | 971 | 2,277 |
Interest Expense | 454 | -15 |
Depreciation, Depletion and Amortization, Nonproduction | 1,774 | 526 |
TotalExpenses | 3,199 | 2,788 |
Income (Loss) from Continuing Operations, Including Portion Attributable to Noncontrolling Interest | -336 | -41 |
Unaudited | ' | ' |
Rental Income, Nonoperating | 430 | 459 |
Expenses | ' | ' |
Operating Costs and Expenses | 383 | 440 |
Interest Expense | 24 | ' |
Depreciation, Depletion and Amortization, Nonproduction | 115 | 109 |
TotalExpenses | 522 | 549 |
Income (Loss) from Continuing Operations, Including Portion Attributable to Noncontrolling Interest | -92 | -90 |
Material Investee | ' | ' |
Rental Income, Nonoperating | 2,433 | 2,288 |
Expenses | ' | ' |
Operating Costs and Expenses | 588 | 1,837 |
Interest Expense | 430 | -15 |
Depreciation, Depletion and Amortization, Nonproduction | 1,659 | 417 |
TotalExpenses | 2,677 | 2,239 |
Income (Loss) from Continuing Operations, Including Portion Attributable to Noncontrolling Interest | ($244) | $49 |
Note_2_Investments_in_and_Adva8
Note 2 - Investments in and Advances To Local Partnerships: Schedule of Encumbrances and Investment Properties (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
In Thousands, unless otherwise specified | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Amount of Encumbrances | $14,422 | ' | ' |
Land | 1,122 | 1,028 | ' |
Buildings and Improvements, Gross | 13,860 | 12,247 | ' |
Real Estate Assets | 14,982 | 13,275 | 12,747 |
SEC Schedule III, Real Estate Accumulated Depreciation | 6,748 | 6,208 | 5,688 |
Lincoln Grove | ' | ' | ' |
SEC Schedule III, Real Estate and Accumulated Depreciation, Amount of Encumbrances | 2,047 | ' | ' |
Land | 112 | ' | ' |
Buildings and Improvements, Gross | 4,109 | ' | ' |
Real Estate Assets | 4,221 | ' | ' |
SEC Schedule III, Real Estate Accumulated Depreciation | 2,355 | ' | ' |
Michigan Beach | ' | ' | ' |
SEC Schedule III, Real Estate and Accumulated Depreciation, Amount of Encumbrances | 12,375 | ' | ' |
Land | 1,010 | ' | ' |
Buildings and Improvements, Gross | 9,751 | ' | ' |
Real Estate Assets | 10,761 | ' | ' |
SEC Schedule III, Real Estate Accumulated Depreciation | $4,393 | ' | ' |
Note_2_Investments_in_and_Adva9
Note 2 - Investments in and Advances To Local Partnerships: Schecule of Reconciliation of real estate (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Real Estate Assets | $13,275 | $12,747 |
SEC Schedule III, Real Estate, Improvements | 1,707 | 528 |
Real Estate Assets | 14,982 | 13,275 |
Unaudited | ' | ' |
Real Estate Assets | 4,210 | 4,190 |
SEC Schedule III, Real Estate, Improvements | 11 | 20 |
Real Estate Assets | 4,221 | 4,210 |
Material Investee | ' | ' |
Real Estate Assets | 9,065 | 8,557 |
SEC Schedule III, Real Estate, Improvements | 1,696 | 508 |
Real Estate Assets | $10,761 | $9,065 |
Recovered_Sheet7
Note 2 - Investments in and Advances To Local Partnerships: Schedule of Reconciliation of accumulated depreciation (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
SEC Schedule III, Real Estate Accumulated Depreciation, Beginning Balance | $6,208 | $5,688 |
Depreciation | 540 | 520 |
SEC Schedule III, Real Estate Accumulated Depreciation, Ending Balance | 6,748 | 6,208 |
Unaudited | ' | ' |
SEC Schedule III, Real Estate Accumulated Depreciation, Beginning Balance | 2,241 | 2,133 |
Depreciation | 114 | 108 |
SEC Schedule III, Real Estate Accumulated Depreciation, Ending Balance | 2,355 | 2,241 |
Material Investee | ' | ' |
SEC Schedule III, Real Estate Accumulated Depreciation, Beginning Balance | 3,967 | 3,555 |
Depreciation | 426 | 412 |
SEC Schedule III, Real Estate Accumulated Depreciation, Ending Balance | $4,393 | $3,967 |
Note_3_Mortgage_Note_Receivabl2
Note 3 - Mortgage Note Receivable: Summary of mortgage note receivable activity (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Details | ' | ' |
Mortgage note receivable balance, beginning of year | $3,533 | $3,674 |
Equity in losses of Local Partnership | -55 | -141 |
Mortgage note receivable balance, end of year | $3,478 | $3,533 |
Note_5_Income_Taxes_Reconcilia2
Note 5 - Income Taxes: Reconciliation between the Partnership's reported net income and the net income (loss) per tax return (Details) (USD $) | 12 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Details | ' | ' |
Net Income (Loss) | ($1,633) | $3,300 |
Proceeds from Sale of Interest in Partnership Unit | 0 | -3,612 |
Effective Income Tax Rate Reconciliation, Other Adjustments, Amount | 0 | -177 |
Investment in Local Partnerships | 5,068 | -289 |
Net income (loss) per tax return | $3,435 | ($778) |
Net income (loss) per limited partnership interest | $47,220 | ($53,360) |
Note_5_Income_Taxes_Reconcilia3
Note 5 - Income Taxes: Reconciliation between the Partnership's reported amounts and the Federal tax basis of net assets (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Details | ' | ' |
Assets, Net | $7,258 | $8,891 |
Deferred offering costs | 9,367 | 9,367 |
Investment in Local Partnerships | -8,000 | -13,392 |
Assets Reconciliation, Other | 3,349 | 3,673 |
Net assets - Federal tax basis | $11,974 | $8,539 |