FORM 10-QSB--QUARTERLY OR TRANSITIONAL REPORT UNDER SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Quarterly or Transitional Report
U.S. 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 June 30, 2000
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the transition period from _________to _________
Commission file number 0-13465
NATIONAL HOUSING PARTNERSHIP REALTY FUND I (Exact name of
small business issuer as specified in its charter)
Maryland 52-1358879
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
55 Beattie Place, P.O. Box 1089
Greenville, SC 29601
(Address of principal executive offices)
(864) 239-1000
(Issuer's telephone number)
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. Yes X No____
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
a)
NATIONAL HOUSING PARTNERSHIP REALTY FUND I
Statement of Financial Position
(Unaudited)
(in thousands)
June 30, 2000
ASSETS
Cash and cash equivalents $ --
Investments in and advances to Local Limited
Partnerships (Note 2) 1,863
$1,863
LIABILITIES AND PARTNERS' (DEFICIT) EQUITY
Liabilities
Administrative and reporting fee payable to
General Partner (Note 3) $1,047
Due to General Partner (Note 3) 9
Accrued interest on partner loans (Note 3) 2
Other accrued expenses 17
1,075
Partners' (deficit) equity
General Partner -- The National Housing
Partnership (NHP) (87)
Original Limited Partner -- 1133 Fifteenth
Street Associates (92)
Other Limited Partners -- 11,509 investment
units 967
788
$1,863
See Accompanying Notes to Financial Statements
b)
NATIONAL HOUSING PARTNERSHIP REALTY FUND I
Statements of Operations
(in thousands, except unit data)
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
2000 1999 2000 1999
revenues:
Share of profits from Local
<S> <C> <C> <C> <C> <C>
Limited Partnerships (Note 2) $ 22 $ 31 $ 22 $ 23
Distributions in excess of investment
in Local Limited Partnership (Note 2) 34 -- 34 --
56 31 56 23
Costs and Expenses:
Administrative and reporting fees to
General Partner (Note 3) 22 21 44 43
Other operating expenses 25 12 35 30
Total expenses 47 33 79 73
Net income (loss) $ 9 $ (2) $ (23) $ (50)
Allocation of net income (loss):
General Partner - NHP $ -- $ -- $ -- $ --
Original Limited Partner - 1133
Fifteenth Street Associates -- -- -- --
Other Limited Partners $ 9 $ (2) $ (23) $ (50)
Net income (loss) per Other Limited
Partnership Interest $ .78 $ (.17) $ (2.00) $ (4.34)
See Accompanying Notes to Financial Statements
</TABLE>
c)
NATIONAL HOUSING PARTNERSHIP REALTY FUND I
Statement of Partners' (Deficit) Equity
(in thousands)
(Unaudited)
<TABLE>
<CAPTION>
The National 1133
Housing Fifteenth Other
Partnership Street Limited
(NHP) Associates Partners Total
(Deficit) equity at
<S> <C> <C> <C> <C> <C> <C>
December 31, 1999 $ (87) $ (92) $ 990 $ 811
Net loss - six months ended
June 30, 2000 -- -- (23) (23)
(Deficit) equity at
June 30, 2000 $ (87) $ (92) $ 967 $ 788
Percentage interest at
June 30, 2000 1% 1% 98% 100%
(A) (B) (C)
(A) General Partner
(B) Original Limited Partner
(C) Consists of 11,509 investment units
See Accompanying Notes to Financial Statements
</TABLE>
d)
NATIONAL HOUSING PARTNERSHIP REALTY FUND I
Statements of Cash Flows
(in thousands)
(Unaudited)
<TABLE>
<CAPTION>
Six Months Ended
June 30,
2000 1999
CASH FLOWS USED IN OPERATING ACTIVITIES:
Distributions in excess of investment in Local Limited
<S> <C> <C>
Partnerships $ 34 $ --
Operating expenses paid (57) (40)
Net cash used in operating activities (23) (40)
CASH FLOWS FROM INVESTING ACTIVITIES
Distributions received from Local Limited
Partnerships with equity balances -- 39
CASH FLOWS FROM FINANCING ACTIVITIES:
Net advances from General Partner -- 1
NET DECREASE IN CASH AND CASH EQUIVALENTS (23) --
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 23 --
CASH AND CASH EQUIVALENTS, END OF PERIOD $ -- $ --
RECONCILIATION OF NET LOSS TO NET CASH USED IN OPERATING
ACTIVITIES:
Net loss $ (23) $ (50)
Adjustments to reconcile net loss to net cash used in
operating activities:
Share of profits from Local Limited Partnerships (22) (23)
Increase in administrative and reporting fees payable 44 43
Decrease in other accrued expenses (22) (10)
Total adjustments -- 10
Net cash used in operating activities $ (23) $ (40)
See Accompanying Notes to Financial Statements
</TABLE>
e)
NATIONAL HOUSING PARTNERSHIP REALTY FUND I
Notes to Financial Statements
(Unaudited)
(1) ACCOUNTING POLICIES
Organization
National Housing Partnership Realty Fund I (the "Partnership" or the
"Registrant") is a limited partnership organized under the Maryland Revised
Uniform Limited Partnership Act on October 21, 1983. The Partnership was formed
for the purpose of raising capital by offering and selling limited partnership
interests and then investing in limited partnerships (Local Limited
Partnerships), each of which owns and operates an existing rental housing
project which is financed and/or operated with one or more forms of rental
assistance or financial assistance from the U.S. Department of Housing and Urban
Development ("HUD").
The National Housing Partnership, a District of Columbia limited partnership
("NHP" or the "General Partner"), raised capital for the Partnership by offering
and selling to additional limited partners 11,519 investment units at a price of
$1,000 per unit. During 1984, the Partnership acquired limited partnership
interests ranging from 98% to 99% in ten Local Limited Partnerships, each of
which was organized to acquire and operate an existing rental housing project.
Apartment Investment and Management Company ("AIMCO") and its affiliates
ultimately control the General Partner. The Original Limited Partner of the
Partnership is 1133 Fifteenth Street Associates, whose limited partners were key
employees of the general partner of NHP at the time the Partnership was formed.
The general partner of 1133 Fifteenth Street Associates is NHP.
Basis of Presentation
The accompanying unaudited interim financial statements reflect all adjustments
which are, in the opinion of management, necessary for a fair statement of the
financial condition and results of operations for the interim periods presented.
All such adjustments are of a normal and recurring nature.
While the General Partner believes that the disclosures presented are adequate
to make the information not misleading, it is suggested that these financial
statements be read in conjunction with the financial statements and notes
included in the Partnership's Annual Report filed on Form 10-KSB for the year
ended December 31, 1999.
(2) INVESTMENTS IN AND ADVANCES TO LOCAL LIMITED PARTNERSHIPS
The Partnership owns a 98% limited partnership interest in Gates Mills I Limited
Partnership and 99% limited partnership interests in nine other Local Limited
Partnerships: Fairmeadows Limited Partnership, Forest Green Limited Partnership,
Griffith Limited Partnership, Northgate Village Limited Partnership, Southward
Limited Partnership, San Jose Limited Partnership, Southridge Apartments Limited
Partnership, Hurbell IV Limited Partnership, and Village Green Limited
Partnership. Since the Partnership, as a limited partner, does not exercise
control over the activities of the Local Limited Partnerships in accordance with
the partnership agreements, these investments are accounted for using the equity
method. Thus, the investments (and the advances made to the Local Limited
Partnerships as discussed below) are carried at cost plus the Partnership's
share of the Local Limited Partnerships' profits less the Partnership's share of
the Local Limited Partnerships' losses and distributions. However, since the
Partnership is not legally liable for the obligations of the Local Limited
Partnerships, or is not otherwise committed to provide additional support to
them, it does not recognize losses once its investment in each of the individual
Local Limited Partnerships, increased for its share of profits, reduced for its
share of losses and cash distributions, reaches zero. As of June 30, 2000,
investments in eight of the ten Local Limited Partnerships had been reduced to
zero. As a result, the Partnership did not recognize approximately $363,000 and
$420,000 of losses from Local Limited Partnerships during the six months ended
June 30, 2000 and 1999, respectively. As of June 30, 2000, the Partnership has
not recognized a total of approximately $18,081,000 of its allocated share of
cumulative losses from the Local Limited Partnerships in which its investment is
zero.
Eight of the Local Limited Partnerships in which the Partnership has invested
have deferred acquisition notes due to the original owner of each Property. With
the exception of Fairmeadows and Southridge, these notes were due between 1997
and 1999, and are currently in default. Fairmeadows and Southridge are currently
in default due to non-payment of required annual interest payments for 1999 (see
below). These notes are secured by both the Partnership's and NHP's interests in
the Local Limited Partnerships. The noteholders have not exercised their rights
under the notes, including the foreclosure on NHP's and the Partnership's
interests in the Local Limited Partnerships. There can be no assurance as to
when, or if, such holders may seek to exercise such rights.
The Fairmeadows and Southridge notes, both of which were issued in connection
with the Partnership's initial acquisition of the property, initially accrued
interest at the rate of 10% per annum. The notes are nonrecourse and are secured
by a security interest in all partnership interests in the Partnership. In 1996,
the Partnership and the holders of the Fairmeadows and Southridge notes entered
into a Modification, Renewal and Extension of Liens Agreement (the Agreement)
which extended the maturity of the notes to December 1, 2011. Interest on the
notes continues to accrue at 10% and is due and payable at maturity; provided,
however, that minimum annual installments of interest are paid on or before
December 31 of each year through December 31, 2010. Such minimum annual
installment increases each year by not less than 2.5% and not more than 5%,
based on the Consumer Price Index for All Urban Consumers (CPI-U). No minimum
payments were paid in 1999 or during the six months ended June 30, 2000 on
either note.
Griffith, Southward, Northgate Village, San Jose, Gates Mill I and Hurbell IV
Limited Partnerships all have notes which were executed by the respective Local
Limited Partnerships with the seller as part of the acquisition of the property
by the Local Limited Partnership. The notes were nonrecourse notes secured by a
security interest in all partnership interests in the Local Limited Partnership
and are subordinated to the respective mortgage notes on each property for as
long as the mortgage notes are insured by HUD. Any payments due from project
income are payable from surplus cash, as defined by the HUD Regulatory
Agreement. Neither the Limited Partnership nor any partner thereof, present or
future, assume any personal liability for the payment of the notes. The notes
were due October 31, 1997, October 4, 1998, July 26, 1999, August 29, 1999,
October 1, 1999, and November 9, 1999, respectively. Interest continues to be
paid or accrued under the original terms of the respective agreements. Each note
is in default and the Local Limited Partnership interests are subject to
potential foreclosure. Continuation of the Local Limited Partnerships'
operations in the present form is dependent on its ability to extend the
maturity date of their respective notes, or to repay or refinance their note.
The financial statements do not include any adjustments which might result from
the outcome of this uncertainty.
Advances made by the Partnership to the individual Local Limited Partnerships
are considered part of the Partnership's investment in Local Limited
Partnerships. When advances are made, they are charged to operations as a loss
on investment in the Local Limited Partnership using previously unrecognized
cumulative losses. As discussed above, due to the cumulative losses incurred by
eight of the Local Limited Partnerships, the aggregate balance of investments in
and advances to Local Limited Partnerships, for these eight Local Limited
Partnerships, has been reduced to zero at June 30, 2000. To the extent these
advances are repaid by the Local Limited Partnerships in the future, the
repayments will be credited as distributions and repayments in excess of
investment in Local Limited Partnerships. These advances are payable to the
Partnership. Interest is calculated at the Chase Manhattan prime rate plus 2%
(11.50% at June 30, 2000). Payment of principal and interest is contingent upon
the Local Limited Partnerships having available surplus cash, as defined by HUD
regulations, from operations or from refinancing or sale of the Local Limited
Partnership properties.
During the six months ended June 30, 2000 and 1999, the Partnership made no
advances for working capital purposes. At June 30, 2000, the amount owed to the
Partnership for working capital advances to Local Limited Partnerships amounted
to approximately $362,000.
The following are combined statements of operations for the three and six months
ended June 30, 2000 and 1999, respectively, of the Local Limited Partnerships in
which the Partnership has invested. The statements are compiled from financial
statements of the Local Limited Partnerships, prepared on the accrual basis of
accounting, as supplied by the management agents of the projects, and are
unaudited.
COMBINED STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
2000 1999 2000 1999
(in thousands)
<S> <C> <C> <C> <C>
Rental income $ 1,939 $ 1,865 $ 3,838 $ 3,680
Other income 94 60 165 119
Total income 2,033 1,925 4,003 3,799
Operating expenses 1,262 1,248 2,470 2,440
Interest, taxes, and insurance 600 575 1,188 1,127
Depreciation 323 289 634 585
Total expense 2,185 2,112 4,292 4,152
Net loss $ (152) $ (187) $ (289) $ (353)
National Housing Partnership
Realty Fund I share of losses $ (150) $ (183) $ (285) $ (347)
</TABLE>
(3) TRANSACTIONS WITH THE GENERAL PARTNER
During the six month periods ended June 30, 2000 and 1999, the Partnership
accrued administrative and reporting fees payable to the General Partner in the
amount of approximately $44,000 and $43,000, respectively, for services provided
to the Partnership. No payments for such fees were made to the General Partner
during the six months ended June 30, 2000 and 1999. As of June 30, 2000, the
Partnership owed approximately $1,047,000 to the General Partner for accrued
administrative and reporting fees.
During the six months ended June 30, 1999, approximately $1,000 of working
capital advances were made by the General Partner to the Partnership. No such
amounts were advanced or repaid during the six months ended June 30, 2000. The
amount owed to the General Partner at June 30, 2000 was approximately $9,000.
Interest is charged on borrowings at the Chase Manhattan Bank rate of prime plus
2% (11.50% at June 30, 2000). Accrued interest on this loan amounted to
approximately $2,000 at June 30, 2000.
The advances and accrued administrative and reporting fees payable to the
General Partner will be paid as cash flow permits or from proceeds generated
from the sale or refinancing of one or more of the underlying properties of the
Local Limited Partnerships.
(4) SEGMENT INFORMATION
The Partnership has only one reportable segment. Due to the very nature of the
Partnership's operations, the General Partner believes that segment-based
disclosures will not result in a more meaningful presentation than the financial
statements as currently presented.
(5) GOING CONCERN
Certain of the Local Partnership's notes payable are past due (see Note 2).
Continuation of the Local Partnerships' operations in the present form is
dependent on its ability to extend the maturity date of these notes, or to repay
or to refinance the notes. These conditions raise substantial doubt about their
ability to continue as a going concern. The financial statements do not include
any adjustments which might result from the outcome of this uncertainty.
(6) LEGAL PROCEEDINGS
In 1997, NHP received subpoenas from the HUD Inspector General ("IG") requesting
documents relating to arrangements whereby NHP or any of its affiliates provided
compensation to owners of HUD-assisted or HUD-insured multi-family projects in
exchange for or in connection with property management of a HUD project. In July
1999, NHP received a grand jury subpoena requesting documents relating to the
same subject matter as the HUD IG subpoenas and NHP's operation of a group
purchasing program created by NHP, known as Buyers Access. To date, neither the
HUD IG nor the grand jury has initiated any action against NHP or AIMCO, the
ultimate controlling entity of NHP or, to NHP's or AIMCO's knowledge, any owner
of a HUD property managed by NHP. AIMCO believes that NHP's operations and
programs are in compliance, in all material respects, with all laws, rules and
regulations relating to HUD-assisted or HUD-insured properties. NHP and AIMCO
are cooperating with the investigations and does not believe that the
investigations will result in a material adverse impact on its operations.
However, as with any similar investigation, there can be no assurance that these
will not result in material fines, penalties or other costs.
The Partnership is unaware of any other pending or outstanding litigation that
is not of a routine nature arising in the ordinary course of business.
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
The matters discussed in this Form 10-QSB contain certain forward-looking
statements and involve risks and uncertainties (including changing market
conditions, competitive and regulatory matters, etc.) detailed in the
disclosures contained in this Form 10-QSB and the other filings with the
Securities and Exchange Commission made by the Registrant from time to time. The
discussion of the Registrant's business and results of operations, including
forward-looking statements pertaining to such matters, does not take into
account the effects of any changes to the Registrant's business and results of
operation. Accordingly, actual results could differ materially from those
projected in the forward-looking statements as a result of a number of factors,
including those identified herein.
This item should be read in conjunction with the financial statements and other
items contained elsewhere in this report.
LIQUIDITY AND CAPITAL RESOURCES
The Properties in which the Partnership has invested, through its investments in
the Local Limited Partnerships, receive one or more forms of assistance from the
Federal Government. As a result, the Local Limited Partnerships' ability to
transfer funds either to the Partnership or among themselves in the form of cash
distributions, loans or advances is generally restricted by these
government-assistance programs. These restrictions, however, are not expected to
impact the Partnership's ability to meet its cash obligations.
The Partnership had no cash and cash equivalents at June 30, 2000 and 1999. The
Partnership had cash and cash equivalents of approximately $23,000 at December
31, 1999. The ability of the Partnership to meet its on-going cash requirements,
in excess of cash on hand at June 30, 2000, is dependent on distributions from
recurring operations received from the Local Limited Partnerships and proceeds
from the sales or refinancings of the underlying properties. The Partnership's
only other form of liquidity is from General Partner loans. For the six months
ended June 30, 1999, the General Partner advanced the Partnership approximately
$1,000 to pay operating expenses. There were no advances for the six months
ended June 30, 2000. The General Partner will evaluate lending the Partnership
additional funds as such funds are needed, but is in no way legally obligated to
make such loans.
At June 30, 2000, the Partnership currently owes the General Partner
approximately $1,047,000 for administrative and reporting services performed.
During the six months ended June 30, 2000 and 1999, no payments were made by the
Partnership to the General Partner for administrative and reporting services.
There is no guarantee that the Local Limited Partnerships will generate future
surplus cash sufficient to distribute to the Partnership in amounts adequate to
repay administrative and reporting fees owed, rather the payment of the unpaid
administrative and reporting fees will most likely result from the sale or
refinancing of the underlying properties of the Local Limited Partnerships,
rather than through recurring operations.
During the six months ended June 30, 2000 and 1999, no working capital advances
were made by the Partnership to the Local Limited Partnerships. No repayments of
advances were received from the Local Limited Partnerships during the six months
ended June 30, 2000 or 1999. The combined amount carried as due to the
Partnership by the Local Limited Partnerships was approximately $362,000 as of
June 30, 2000.
Distributions received in excess of investment in Local Limited Partnerships
represent the Partnership's proportionate share of the excess cash available for
distribution from the Local Limited Partnerships. As a result of the use of the
equity method of accounting for the Partnership's investments, as of June 30,
2000, investments in eight of the Local Limited Partnerships has been decreased
to zero. Cash distributions received are recorded in revenues as distributions
received in excess of investment in Local Limited Partnerships. Cash
distributions of approximately $34,000 were received from two Local Limited
Partnerships during the six months ended June 30, 2000. No cash distributions
were received from the Local Limited Partnerships during the six months ended
June 30, 1999. The receipt of distributions in future years is dependent on the
operations of the underlying properties of the Local Limited Partnerships.
Eight of the Local Limited Partnerships in which the Partnership has invested
have deferred acquisition notes due to the original owner of each Property. With
the exception of Fairmeadows and Southridge, these notes were due between 1997
and 1999, and are currently in default. Fairmeadows and Southridge are currently
in default due to non-payment of required annual interest payments for 1999 (see
below). These notes are secured by both the Partnership's and NHP's interests in
the Local Limited Partnerships. The noteholders have not exercised their rights
under the notes, including the foreclosure on NHP's and the Partnership's
interests in the Local Limited Partnerships. There can be no assurance as to
when, or if, such holders may seek to exercise such rights.
The Fairmeadows and Southridge notes, both of which were issued in connection
with the Partnership's initial acquisition of the property, initially accrued
interest at the rate of 10% per annum. The notes are nonrecourse and are secured
by a security interest in all partnership interests in the Partnership. In 1996,
the Partnership and the holders of the Fairmeadows and Southridge notes entered
into a Modification, Renewal and Extension of Liens Agreement (the Agreement)
which extended the maturity of the notes to December 1, 2011. Interest on the
notes continues to accrue at 10% and is due and payable at maturity; provided,
however, that minimum annual installments of interest are paid on or before
December 31 of each year through December 31, 2010. Such minimum annual
installment increases each year by not less than 2.5% and not more than 5%,
based on the Consumer Price Index for All Urban Consumers (CPI-U). No minimum
payments were paid in 1999 or during the six months ended June 30, 2000 on
either note.
Griffith, Southward, Northgate Village, San Jose, Gates Mill I and Hurbell IV
Limited Partnerships all have notes which were executed by the respective Local
Limited Partnerships with the seller as part of the acquisition of the property
by the Local Limited Partnership. The notes were nonrecourse notes secured by a
security interest in all partnership interests in the Local Limited Partnership
and are subordinated to the respective mortgage notes on each property for as
long as the mortgage notes are insured by HUD. Any payments due from project
income are payable from surplus cash, as defined by the HUD Regulatory
Agreement. Neither the Limited Partnership nor any partner thereof, present or
future, assume any personal liability for the payment of the notes. The notes
were due October 31, 1997, October 4, 1998, July 26, 1999, August 29, 1999,
October 1, 1999, and November 9, 1999, respectively. Interest continues to be
paid or accrued under the original terms of the respective agreements. Each note
is in default and the Local Limited Partnership interests are subject to
potential foreclosure. Continuation of the Local Limited Partnerships'
operations in the present form is dependent on its ability to extend the
maturity date of their respective notes, or to repay or refinance their note.
The financial statements do not include any adjustments which might result from
the outcome of this uncertainty.
RESULTS OF OPERATIONS
The Partnership has invested as a limited partner in Local Limited Partnerships
which operate ten rental housing properties. Due to the use of the equity method
of accounting as discussed in Note 2 to the Partnership's financial statements,
to the extent the Partnership still has a carrying basis in a respective Local
Limited Partnership, results of operations would be impacted by the
Partnership's share of the profits or losses of the Local Limited Partnerships.
Eight of the ten investments in Local Limited Partnership have been reduced to
zero. As a result, the Partnership's operations are no longer being affected by
its share of the operations. The Partnership has recorded its share of
operations in the remaining two Local Limited Partnerships which amounted to
profits of approximately $22,000 and $23,000 for the six months ended June 30,
2000 and 1999, respectively.
The Partnership realized net income of approximately $9,000 and a net loss of
approximately $23,000 for the three and six months ended June 30, 2000,
respectively, compared to a net loss of approximately $2,000 and $50,000 for the
three and six months ended June 30, 1999. Net income (loss) per unit of limited
partnership interest was approximately $.78 and ($2.00) for the three and six
months ended June 30, 2000 and approximately ($.17) and ($4.34) for the three
and six months ended June 30, 1999. The decrease in net loss was due primarily
to the distributions received in excess of the Partnership's investment in Local
Limited Partnerships during the three and six months ended June 30, 2000. The
decrease in net loss was partially offset by an increase in the Partnership's
operating expenses.
The Partnership did not recognize approximately $363,000 of its allocated share
of losses from six Local Limited Partnerships and approximately $56,000 of its
allocated share of profits from two Local Limited Partnerships for the six
months ended June 30, 2000, as the Partnership's net carrying basis in these
Local Limited Partnerships had been reduced to zero. The Partnership did not
recognize approximately $420,000 of its allocated share of losses from seven
Local Limited Partnerships and approximately $49,000 of its allocated share of
profit from one Local Limited Partnership for the six months ended June 30,
1999, as the Partnership's net carrying basis in these Local Limited
Partnerships had been reduced to zero.
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
In 1997, NHP received subpoenas from the HUD Inspector General ("IG") requesting
documents relating to arrangements whereby NHP or any of its affiliates provided
compensation to owners of HUD-assisted or HUD-insured multi-family projects in
exchange for or in connection with property management of a HUD project. In July
1999, NHP received a grand jury subpoena requesting documents relating to the
same subject matter as the HUD IG subpoenas and NHP's operation of a group
purchasing program created by NHP, known as Buyers Access. To date, neither the
HUD IG nor the grand jury has initiated any action against NHP or Apartment
Investment and Management Company ("AIMCO"), the ultimate controlling entity of
NHP or, to NHP's or AIMCO's knowledge, any owner of a HUD property managed by
NHP. AIMCO believes that NHP's operations and programs are in compliance, in all
material respects, with all laws, rules and regulations relating to HUD-assisted
or HUD-insured properties. NHP and AIMCO are cooperating with the investigations
and does not believe that the investigations will result in a material adverse
impact on its operations. However, as with any similar investigation, there can
be no assurance that these will not result in material fines, penalties or other
costs.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
a) Exhibits
Exhibit 27, Financial Data Schedule
b) Reports on Form 8-K:
None filed during the quarter ended June 30, 2000.
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
NATIONAL HOUSING PARTNERSHIP REALTY FUND I
(Registrant)
By: The National Housing Partnership,
Its sole General Partner
By: National Corporation for Housing
Partnerships, its sole General Partner
By: /s/Patrick J. Foye
Patrick J. Foye
President
By: /s/Martha L. Long
Martha L. Long
Senior Vice President and
Controller
Date: August 11, 2000
