February 14, 2001
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Re: Boston Financial Tax Credit Fund VIII, A Limited Partnership
Report on Form 10-QSB for the Quarter Ended December 31, 2000
File Number 0-26522
Dear Sir/Madam:
Pursuant to the requirements of Section 15(d) of the Securities Exchange Act of
1934, filed herewith is a copy of subject report.
Very truly yours,
/s/Stephen Guilmette
Stephen Guilmette
Assistant Controller
TC8-Q3.DOC
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
(Mark One)
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended December 31, 2000
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OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
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Commission file number 0-26522
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Boston Financial Tax Credit Fund VIII, A Limited Partnership
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(Exact name of registrant as specified in its charter)
Massachusetts 04-3205879
- ------------------------------------------- ----------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
101 Arch Street, Boston, Massachusetts 02110-1106
- --------------------------------------------- -------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (617) 439-3911
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Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes X No .
BOSTON FINANCIAL TAX CREDIT FUND VIII
(A Limited Partnership)
TABLE OF CONTENTS
PART I. FINANCIAL INFORMATION Page No.
- ------------------------------ --------
Item 1. Financial Statements
Balance Sheet - December 31, 2000 (Unaudited) 1
Statements of Operations (Unaudited) - For the Three and Nine
Months Ended December 31, 2000 and 1999 2
Statement of Changes in Partners' Equity (Deficiency) (Unaudited) -
For the Nine Months Ended December 31, 2000 3
Statements of Cash Flows (Unaudited) - For the Nine
Months Ended December 31, 2000 and 1999 4
Notes to the Financial Statements (Unaudited) 5
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 6
PART II - OTHER INFORMATION
Items 1-6 8
SIGNATURE 9
BOSTON FINANCIAL TAX CREDIT FUND VIII
(A Limited Partnership)
BALANCE SHEET
December 31, 2000
(Unaudited)
Assets
Cash and cash equivalents $ 125,243
Investments in Local Limited Partnerships, net (Note 1) 19,518,164
Marketable securities, at fair value 1,495,513
Other assets 22,322
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Total Assets $ 21,161,242
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Liabilities and Partners' Equity
Liabilities
Accounts payable to affiliate $ 476,022
Accrued expenses 40,142
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Total Liabilities 516,164
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General, Initial and Investor Limited Partners' Equity 20,637,841
Net unrealized gains on marketable securities 7,237
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Total Partners' Equity 20,645,078
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Total Liabilities and Partners' Equity $ 21,161,242
=============
The accompanying notes are an integral part of these financial statements.
BOSTON FINANCIAL TAX CREDIT FUND VIII
(A Limited Partnership)
STATEMENTS OF OPERATIONS
For the Three and Nine Months Ended December 31, 2000 and 1999
(Unaudited)
Three Months Ended Nine Months Ended
December 31, December 31, December 31, December 31,
2000 1999 2000 1999
------------- ------------- -------------- ---------------
Revenue:
Investment $ 25,266 $ 23,506 $ 74,696 $ 67,779
Other 50 50 1,030 1,200
------------- ------------- -------------- ---------------
Total Revenue 25,316 23,556 75,726 68,979
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Expenses:
Asset management fees,
related party 52,679 51,555 158,037 154,665
General and administrative
expenses (includes
reimbursements to affiliates
in the amounts of $18,957
and $57,340 in 2000 and
1999, respectively) (26,186) 38,800 55,466 105,844
Provision for valuation
of Investment in Local
Limited Partnerships 8,884 - 8,884 -
Amortization 7,486 7,486 22,458 22,457
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Total Expenses 42,863 97,841 244,845 282,966
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Loss before equity in losses
of Local Limited Partnerships (17,547) (74,285) (169,119) (213,987)
Equity in losses of Local
Limited Partnerships (Note 1) (536,791) (466,111) (1,488,771) (1,515,738)
------------- ------------- -------------- ---------------
Net Loss $ (554,338) $ (540,396) $ (1,657,890) $ (1,729,725)
============= ============= ============== ===============
Net Loss allocated:
To General Partners $ (5,543) $ (5,404) $ (16,579) $ (17,297)
To Limited Partners (548,795) (534,992) (1,641,311) (1,712,428)
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$ (554,338) $ (540,396) $ (1,657,890) $ (1,729,725)
============= ============= ============== ===============
Net Loss per Limited
Partnership Unit (36,497 Units) $ (15.04) $ (14.66) $ (44.97) $ (46.92)
============= ============= ============== ===============
The accompanying notes are an integral part of these financial statements.
BOSTON FINANCIAL TAX CREDIT FUND VIII
(A Limited Partnership)
STATEMENT OF CHANGES IN PARTNERS' EQUITY (DEFICIENCY)
For the Nine Months Ended December 31, 2000
(Unaudited)
Net
Initial Investor Unrealized
General Limited Limited Gains
Partner Partner Partners (Losses) Total
Balance at March 31, 2000 $ (93,390) $ 100 $ 22,389,021 $ (22,329) $ 22,273,402
----------- --------- -------------- ----------- -------------
Comprehensive Income (Loss):
Change in net unrealized gains
(losses) on marketable securities
available for sale - - - 29,566 29,566
Net Loss (16,579) - (1,641,311) - (1,657,890)
----------- --------- -------------- ----------- -------------
Comprehensive Income (Loss) (16,579) - (1,641,311) 29,566 (1,628,324)
----------- --------- -------------- ----------- -------------
Balance at December 31, 2000 $ (109,969) $ 100 $ 20,747,710 $ 7,237 $ 20,645,078
=========== ========= ============== =========== =============
The accompanying notes are an integral part of these financial statements.
BOSTON FINANCIAL TAX CREDIT FUND VIII
(A Limited Partnership)
STATEMENTS OF CASH FLOWS
For the Nine Months Ended December 31, 2000 and 1999
(Unaudited)
2000 1999
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Net cash used for operating activities $ (150,771) $ (142,923)
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Net cash provided by investing activities 87,369 260,480
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Net increase (decrease) in cash and cash equivalents (63,402) 117,557
Cash and cash equivalents, beginning of period 188,645 180,030
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Cash and cash equivalents, end of period $ 125,243 $ 297,587
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The accompanying notes are an integral part of these financial statements.
BOSTON FINANCIAL TAX CREDIT FUND VIII
(A Limited Partnership)
Notes to Financial Statements
(Unaudited)
The unaudited financial statements presented herein have been prepared in
accordance with the instructions to Form 10-QSB and do not include all of the
information and note disclosures required by generally accepted accounting
principles. These statements should be read in conjunction with the financial
statements and notes thereto included with the Fund's Form10-KSB for the year
ended March 31, 2000. In the opinion of management, these financial statements
include all adjustments, consisting only of normal recurring adjustments,
necessary to present fairly the Fund's financial position and results of
operations. The results of operations for the periods may not be indicative of
the results to be expected for the year.
The Managing General Partner has elected to report results of the Local Limited
Partnerships on a 90 day lag basis, because the Local Limited Partnerships
report their results on a calendar year basis. Accordingly, the financial
information about the Local Limited Partnerships that is included in the
accompanying financial statements is as of September 30, 2000 and 1999.
1. Investments in Local Limited Partnerships
The Fund uses the equity method to account for its limited partnership interests
in ten Local Limited Partnerships which own and operate multi-family housing
complexes. The Fund, as Investor Limited Partner, pursuant to the Local Limited
Partnership Agreements, which contain certain operating and distribution
restrictions, has acquired a 99% interest in the profits, losses, tax credits
and cash flows from operations of the Local Limited Partnerships, with the
exception of Springwood, Hemlock Ridge, Pike Place and West End Place, where
79.20%, 77%, 90% and 90% interests were acquired, respectively. Another
partnership sponsored by an affiliate of the General Partner owns the remaining
19.80% Limited Partnership interest in Springwood. Upon dissolution, proceeds
will be distributed according to the partnership agreements.
The following is a summary of Investments in Local Limited Partnerships at
December 31, 2000:
Capital Contributions and advances paid to Local
Limited Partnerships $ 29,273,743
Cumulative equity in losses of Local
Limited Partnerships (10,169,580)
Cumulative cash distributions received
from Local Limited Partnerships (461,836)
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Investments in Local Limited Partnerships
before adjustments 18,642,327
Excess of investment cost over the underlying net assets acquired:
Acquisition fees and expenses 1,048,010
Accumulated amortization of acquisition
fees and expenses (163,289)
Provision for valuation of investment in Local
Limited Partnership (8,884)
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Investments in Local Limited Partnerships $ 19,518,164
=============
The Fund's share of net losses of the Local Limited Partnerships for the nine
months ended December 31, 2000 is $1,488,771.
BOSTON FINANCIAL TAX CREDIT FUND VIII
(A Limited Partnership)
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Certain matters discussed herein constitute forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of 1995. The Fund
intends such forward-looking statements to be covered by the safe harbor
provisions for forward-looking statements and is including this statement for
purposes of complying with these safe harbor provisions. Although the Fund
believes the forward-looking statements are based on reasonable assumptions, the
Fund can give no assurance that their expectations will be attained. Actual
results and timing of certain events could differ materially from those
projected in or contemplated by the forward-looking statements due to a number
of factors, including, without limitation, general economic and real estate
conditions and interest rates.
Liquidity and Capital Resources
At December 31, 2000, the Fund had cash and cash equivalents of $125,243, as
compared, to $188,645 at March 31, 2000. This decrease is primarily attributable
to purchases of marketable securities in excess of proceeds from sales and
maturities of marketable securities. This decrease is partially offset by cash
distributions received from Local Limited Partnerships.
At December 31, 2000, approximately $1,113,000 of marketable securities has been
designated as Reserves. The Reserves are established to be used for working
capital of the Fund and contingencies related to the ownership of Local Limited
Partnership interests. Management believes that the interest income earned on
Reserves, along with cash distributions received from Local Limited
Partnerships, to the extent available, will be sufficient to fund the Fund's
ongoing operations. Reserves may be used to fund operating deficits if the
General Partner deems funding appropriate.
Since the Fund invests as a limited partner, the Fund has no contractual duty to
provide additional funds to Local Limited Partnerships beyond its specified
investment. Thus, as of December 31, 2000, the Fund had no contractual or other
obligation to any Local Limited Partnership which had not been paid.
In the event a Local Limited Partnership encounters operating difficulties
requiring additional funds, the Fund might deem it in its best interests to
voluntarily provide such funds, in order to protect its investment.
Cash Distributions
No cash distributions were made during the nine months ended December 31, 2000.
Results of Operations
For the three and nine months ended December 31, 2000, the Fund's operations
resulted in a net losses of $554,338 and $1,657,890, respectively, as compared
to net losses of $540,396 and $1,729,725 for the same periods in 1999. The
overall decrease in net loss is primarily due to a decrease in general and
administrative expense due to a change in the method used to allocate
operational and administratiave expenses and lower salary reimbursements paid to
an affiliate of the General Partner. The decrease is also attributable to a
decrease in equity in losses of Local Limited Partnerships due to an increase in
total income of Local Limited Partnerships, partially offset by an increase in
Local Limited Partnership operating expenses.
BOSTON FINANCIAL TAX CREDIT FUND VIII
(A Limited Partnership)
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)
Property Discussions
Live Oaks Plantation (West Palm Beach, Florida) continues to experience
operating deficits due primarily to difficulty in attracting and retaining
quality tenants. In addition, the property's curb appeal has diminished due to
the deferral of certain maintenance and repair projects. It is likely that the
Fund will advance up to approximately $800,000 of reserves to the property to
fund capital improvements and deferred maintenance expenses in the near future.
During October 2000, the Local General Partner indicated a desire to transfer
his interest in the property to a replacement Local General Partner. The
Managing General Partner believes that it would be in the best interests of the
property to replace the Local General Partner. Accordingly, the Managing General
is working with the Local General Partner to identify an acceptable replacement.
Recently, the Managing General Partner learned that the Live Oaks Plantation was
undergoing an audit by the Internal Revenue Service ("IRS"). The audit is
currently in its information gathering phase and we are fulfilling all IRS
information requests. However, we are aware that the audit will focus on the tax
treatment of certain items, such as land improvements, impact fees, utility fees
and developer fees. We believe that the IRS wants to allocate some, or all, of
these costs to land rather than to the buildings. Since land cannot be included
in eligible basis and is not depreciable, tax credits and losses may be at risk.
We will keep you apprised of the status of the IRS audit.
The Fund has implemented policies and practices for assessing potential
impairment of its investments in Local Limited Partnerships. Real estate experts
analyze the investments to determine if impairment indicators exist. If so, the
carrying value is compared to the undiscounted future cash flows expected to be
derived from the asset. If a significant impairment in carrying value exists, a
provision to write down the asset to fair value will be recorded in the Fund's
financial statements.
BOSTON FINANCIAL TAX CREDIT FUND VIII
(A Limited Partnership)
PART II OTHER INFORMATION
Items 1-5 Not applicable
Item 6 Exhibits and reports on Form 8-K
(a) Exhibits - None
(b) Reports on Form 8-K - No reports on Form 8-K were filed
during the quarter ended December 31, 2000.
BOSTON FINANCIAL TAX CREDIT FUND VIII
(A Limited Partnership)
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
DATED: February 14, 2001 BOSTON FINANCIAL TAX CREDIT FUND VIII,
A LIMITED PARTNERSHIP
By: Arch Street VIII Limited Partnership,
its General Partner
/s/Jenny Netzer
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Jenny Netzer
Managing Director and President