GTWY2
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE
ACT OF 1934
For The Quarterly Period Ended September 30, 2000
Commission File Number 0-19022
Gateway Tax Credit Fund II Ltd.
(Exact name of Registrant as specified in its charter)
Florida 65-0142704
(State or other jurisdiction of ( I.R.S. Employer No.)
incorporation or organization)
880 Carillon Parkway, St. Petersburg, Florida 33716
(Address of principal executive offices) (Zip Code)
Registrant's Telephone Number, Including Area Code: (727)573-3800
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
Number of Units
Title of Each Class September 30, 2000
Beneficial Assignee Certificates:
$1,000 per certificate 37,228
DOCUMENTS INCORPORATED BY REFERENCE
Parts I and II, 1998 Form 10-K, filed with the
Securities and Exchange Commission on July 13, 1999
Parts III and IV - Form S-11 Registration Statement
and all amendments and supplements thereto
File No. 33-31821
PART I - Financial Information
Item 1. Financial Statements
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
BALANCE SHEETS
SERIES 2 September 30, March 31,
2000 2000
--------- ----------
(Unaudited) (Audited)
ASSETS
Current Assets:
Cash and Cash Equivalents $ 206,509 $ 188,570
Investments in Securities 51,932 51,800
------------ ------------
Total Current Assets 258,441 240,370
Investments in Securities 233,284 274,482
Investments in Project Partnerships, Net 90,403 208,215
------------- -------------
Total Assets $ 582,128 $ 723,067
============= =============
LIABILITIES AND PARTNERS' EQUITY
Current Liabilities:
Payable to General Partners $ 43,798 $ 45,773
------------- -------------
Total Current Liabilities 43,798 45,773
------------- -------------
Long-Term Liabilities:
Payable to General Partners 363,609 361,953
------------- -------------
Partners' Equity (Deficit):
Assignor Limited Partner
Units of limited partnership interest
consisting of 40,000 authorized BAC's, of
which 37,228 at September 30, 2000 and
March 31,2000 have been issued to the
assignees
Assignees
Units of beneficial interest of the
limited partnership interest of the
assignor limited partner, $1,000 stated
value per BAC, 37,228 at September 30,
2000 and March 31, 2000, issued and
outstanding 226,773 365,987
General Partners (52,052) (50,646)
------------- -------------
Total Partners' Equity 174,721 315,341
------------- -------------
Total Liabilities and Partners' Equity $ 582,128 $ 723,067
============= =============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
BALANCE SHEETS
SERIES 3 September 30, March 31,
2000 2000
--------- ----------
(Unaudited) (Audited)
ASSETS
Current Assets:
Cash and Cash Equivalents $ 170,032 $ 155,487
Investments in Securities 46,192 46,075
------------ ------------
Total Current Assets 216,224 201,562
Investments in Securities 207,501 244,145
Investments in Project Partnerships, Net 65,905 100,190
------------- -------------
Total Assets $ 489,630 $ 545,897
============= =============
LIABILITIES AND PARTNERS' EQUITY
Current Liabilities:
Payable to General Partners $ 48,091 $ 49,763
Payable to Other Series 0 0
------------- -------------
Total Current Liabilities 48,091 49,763
------------- -------------
Long-Term Liabilities:
Payable to General Partners 263,851 269,872
------------- -------------
Partners' Equity (Deficit):
Assignor Limited Partner
Units of limited partnership interest
consisting of 40,000 authorized BAC's, of
which 37,228 at September 30, 2000 and
March 31, 2000 have been issued to the
assignees
Assignees
Units of beneficial interest of the
limited partnership interest of the
assignor limited partner, $1,000 stated
value per BAC, 37,228 at September 30,
2000 and March 31, 2000, issued and
outstanding 223,727 271,815
General Partners (46,039) (45,553)
------------- -------------
Total Partners' Equity 177,688 226,262
------------- -------------
Total Liabilities and Partners' Equity $ 489,630 $ 545,897
============= =============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
BALANCE SHEETS
SERIES 4 September 30, March 31,
2000 2000
--------- ----------
(Unaudited) (Audited)
ASSETS
Current Assets:
Cash and Cash Equivalents $ 246,710 $ 226,648
Investments in Securities 58,521 58,372
------------ ------------
Total Current Assets 305,231 285,020
Investments in Securities 262,882 309,308
Investments in Project Partnerships, Net 352,733 487,692
------------- -------------
Total Assets $ 920,846 $ 1,082,020
============= =============
LIABILITIES AND PARTNERS' EQUITY
Current Liabilities:
Payable to General Partners $ 52,948 $ 54,952
------------- -------------
Total Current Liabilities 52,948 54,952
------------- -------------
Long-Term Liabilities:
Payable to General Partners 346,403 348,096
------------- -------------
Partners' Equity (Deficit):
Assignor Limited Partner
Units of limited partnership interest
consisting of 40,000 authorized BAC's, of
which 37,228 at September 30, 2000 and
March 31, 2000 have been issued to the
assignees
Assignees
Units of beneficial interest of the
limited partnership interest of the
assignor limited partner, $1,000 stated
value per BAC, 37,228 at September 30,
2000 and March 31, 2000, issued and
outstanding 576,934 732,836
General Partners (55,439) (53,864)
------------- -------------
Total Partners' Equity 521,495 678,972
------------- -------------
Total Liabilities and Partners' Equity $ 920,846 $ 1,082,020
============= =============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
BALANCE SHEETS
SERIES 5 September 30, March 31,
2000 2000
--------- ----------
(Unaudited) (Audited)
ASSETS
Current Assets:
Cash and Cash Equivalents $ 330,968 $ 318,707
Investments in Securities 72,939 72,753
------------ ------------
Total Current Assets 403,907 391,460
Investments in Securities 327,650 385,513
Investments in Project Partnerships, Net 806,963 951,449
------------- -------------
Total Assets $ 1,538,520 $ 1,728,422
============= =============
LIABILITIES AND PARTNERS' EQUITY
Current Liabilities:
Payable to General Partners $ 71,185 $ 73,415
------------- -------------
Total Current Liabilities 71,185 73,415
------------- -------------
Long-Term Liabilities:
Payable to General Partners 337,236 345,734
------------- -------------
Partners' Equity (Deficit):
Assignor Limited Partner
Units of limited partnership interest
consisting of 40,000 authorized BAC's, of
which 37,228 at September 30, 2000 and
March 31, 2000 have been issued to the
assignees
Assignees
Units of beneficial interest of the
limited partnership interest of the
assignor limited partner, $1,000 stated
value per BAC, 37,228 at September 30,
2000 and March 31, 2000, issued and
outstanding 1,194,422 1,371,804
General Partners (64,323) (62,531)
------------- -------------
Total Partners' Equity 1,130,099 1,309,273
------------- -------------
Total Liabilities and Partners' Equity $ 1,538,520 $ 1,728,422
============= =============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
BALANCE SHEETS
SERIES 6 September 30, March 31,
2000 2000
--------- ----------
(Unaudited) (Audited)
ASSETS
Current Assets:
Cash and Cash Equivalents $ 366,558 $ 422,800
Investments in Securities 56,952 55,114
------------ ------------
Total Current Assets 423,510 477,914
Investments in Securities 329,695 318,064
Investments in Project Partnerships, Net 1,700,772 1,997,390
------------- -------------
Total Assets $ 2,453,977 $ 2,793,368
============= =============
LIABILITIES AND PARTNERS' EQUITY
Current Liabilities:
Payable to General Partners $ 66,624 $ 69,212
------------- -------------
Total Current Liabilities 66,624 69,212
------------- -------------
Long-Term Liabilities:
Payable to General Partners 437,879 438,798
------------- -------------
Partners' Equity (Deficit):
Assignor Limited Partner
Units of limited partnership interest
consisting of 40,000 authorized BAC's, of
which 37,228 at September 30, 2000 and
March 31, 2000 have been issued to the
assignees
Assignees
Units of beneficial interest of the
limited partnership interest of the
assignor limited partner, $1,000 stated
value per BAC, 37,228 at September 30,
2000 and March 31, 2000, issued and
outstanding 2,018,705 2,351,230
General Partners (69,231) (65,872)
------------- -------------
Total Partners' Equity 1,949,474 2,285,358
------------- -------------
Total Liabilities and Partners' Equity $ 2,453,977 $ 2,793,368
============= =============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
BALANCE SHEETS
TOTAL SERIES 2 - 6 September 30, March 31,
2000 2000
--------- ----------
(Unaudited) (Audited)
ASSETS
Current Assets:
Cash and Cash Equivalents $ 1,320,777 $ 1,312,212
Investments in Securities 286,536 284,114
------------ ------------
Total Current Assets 1,607,313 1,596,326
Investments in Securities 1,361,012 1,531,512
Investments in Project Partnerships, Net 3,016,776 3,744,936
------------- -------------
Total Assets $ 5,985,101 $ 6,872,774
============= =============
LIABILITIES AND PARTNERS' EQUITY
Current Liabilities:
Payable to General Partners $ 282,646 $ 293,115
------------- -------------
Total Current Liabilities 282,646 293,115
------------- -------------
Long-Term Liabilities:
Payable to General Partners 1,748,978 1,764,453
------------- -------------
Partners' Equity (Deficit):
Assignor Limited Partner
Units of limited partnership interest
consisting of 40,000 authorized BAC's, of
which 37,228 at September 30, 2000 and
March 31, 2000 have been issued to the
assignees
Assignees
Units of beneficial interest of the
limited partnership interest of the
assignor limited partner, $1,000 stated
value per BAC, 37,228 at September 30,
2000 and March 31, 2000, issued and
outstanding 4,240,559 5,093,672
General Partners (287,082) (278,466)
------------- -------------
Total Partners' Equity 3,953,477 4,815,206
------------- -------------
Total Liabilities and Partners' Equity $ 5,985,101 $ 6,872,774
============= =============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED SEPTEMBER 30,
(Unaudited)
SERIES 2 2000 1999
---- ----
Revenues:
Interest Income $ 8,761 $ 8,235
------------ ------------
Expenses:
Asset Management Fee-General Partner 17,128 17,162
General and Administrative:
General Partner 3,255 2,681
Other 4,087 5,627
Amortization 816 1,212
------------ ------------
Total Expenses 25,286 26,682
------------ ------------
Loss Before Equity in Losses of
Project Partnerships (16,525) (18,447)
Equity in Losses of Project Partnerships (56,543) (75,793)
------------ ------------
Net Loss $ (73,068) $ (94,240)
============ ============
Allocation of Net Loss:
Assignees $ (72,338) $ (93,297)
General Partners (730) (943)
------------ ------------
$ (73,068) $ (94,240)
============ ============
Net Loss Per Beneficial
Assignee Certificate $ (11.79) $ (15.21)
Number of Beneficial Assignee ============ ============
Certificates Outstanding 6,136 6,136
============ ============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED SEPTEMBER 30,
(Unaudited)
SERIES 3 2000 1999
---- ----
Revenues:
Interest Income $ 7,682 $ 7,141
------------ ------------
Expenses:
Asset Management Fee-General Partner 15,825 15,870
General and Administrative:
General Partner 3,402 2,803
Other 4,396 4,966
Amortization 280 760
------------ ------------
Total Expenses 23,903 24,399
------------ ------------
Loss Before Equity in Losses of
Project Partnerships (16,221) (17,258)
Equity in Losses of Project Partnerships (8,355) (12,099)
------------ ------------
Net Loss $ (24,576) $ (29,357)
============ ============
Allocation of Net Loss:
Assignees $ (24,330) $ (29,064)
General Partners (246) (293)
------------ ------------
$ (24,576) $ (29,357)
============ ============
Net Loss Per Beneficial
Assignee Certificate $ (4.46) $ (5.32)
Number of Beneficial Assignee ============ ============
Certificates Outstanding 5,456 5,456
============ ============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED SEPTEMBER 30,
(Unaudited)
SERIES 4 2000 1999
---- ----
Revenues:
Interest Income $ 10,110 $ 9,424
------------ ------------
Expenses:
Asset Management Fee-General Partner 19,458 19,497
General and Administrative:
General Partner 4,289 3,530
Other 5,454 6,116
Amortization 1,664 1,932
------------ ------------
Total Expenses 30,865 31,075
------------ ------------
Loss Before Equity in Losses of
Project Partnerships (20,755) (21,651)
Equity in Losses of Project Partnerships (57,942) (48,440)
------------ ------------
Net Loss $ (78,697) $ (70,091)
============ ============
Allocation of Net Loss:
Assignees $ (77,910) $ (69,390)
General Partners (787) (701)
------------ ------------
$ (78,697) $ (70,091)
============ ============
Net Loss Per Beneficial Assignee
Certificate $ (11.27) $ (10.04)
Number of Beneficial Assignee ============ ============
Certificates Outstanding 6,915 6,915
============ ============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED SEPTEMBER 30,
(Unaudited)
SERIES 5 2000 1999
---- ----
Revenues:
Interest Income $ 13,042 $ 12,055
------------ ------------
Expenses:
Asset Management Fee-General Partner 24,060 24,115
General and Administrative:
General Partner 5,325 4,387
Other 6,692 7,501
Amortization 1,540 1,632
------------ ------------
Total Expenses 37,617 37,635
------------ ------------
Loss Before Equity in Losses of
Project Partnerships (24,575) (25,580)
Equity in Losses of Project Partnerships (69,923) (91,579)
------------ ------------
Net Loss $ (94,498) $ (117,159)
============ ============
Allocation of Net Loss:
Assignees $ (93,553) $ (115,988)
General Partners (945) (1,171)
------------ ------------
$ (94,498) $ (117,159)
============ ============
Net Loss Per Beneficial Assignee
Certificate $ (10.86) $ (13.46)
Number of Beneficial Assignee ============ ============
Certificates Outstanding 8,616 8,616
============ ============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED SEPTEMBER 30,
(Unaudited)
SERIES 6 2000 1999
---- ----
Revenues:
Interest Income $ 12,759 $ 11,485
------------ ------------
Expenses:
Asset Management Fee-General Partner 26,222 26,704
General and Administrative:
General Partner 5,621 4,631
Other 7,347 8,074
Amortization 3,745 4,014
------------ ------------
Total Expenses 42,935 43,423
------------ ------------
Loss Before Equity in Losses of
Project Partnerships (30,176) (31,938)
Equity in Losses of Project Partnerships (154,483) (262,361)
------------ ------------
Net Loss $ (184,659) $ (294,299)
============ ============
Allocation of Net Loss:
Assignees $ (182,812) $ (291,356)
General Partners (1,847) (2,943)
------------ ------------
$ (184,659) $ (294,299)
============ ============
Net Loss Per Beneficial Assignee
Certificate $ (18.09) $ (28.83)
Number of Beneficial Assignee ============ ============
Certificates Outstanding 10,105 10,105
============ ============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED SEPTEMBER 30,
(Unaudited)
TOTAL SERIES 2 - 6 2000 1999
---- ----
Revenues:
Interest Income $ 52,354 $ 48,340
------------ ------------
Expenses:
Asset Management Fee-General Partner 102,693 103,348
General and Administrative:
General Partner 21,892 18,032
Other 27,976 32,284
Amortization 8,045 9,550
------------ ------------
Total Expenses 160,606 163,214
------------ ------------
Loss Before Equity in Losses of
Project Partnerships (108,252) (114,874)
Equity in Losses of Project Partnerships (347,246) (490,272)
------------ ------------
Net Loss $ (455,498) $ (605,146)
============ ============
Allocation of Net Loss:
Assignees $ (450,943) $ (599,094)
General Partners (4,555) (6,052)
------------ ------------
$ (455,498) $ (605,146)
============ ============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF OPERATIONS
FOR THE SIX MONTHS ENDED SEPTEMBER 30,
(Unaudited)
SERIES 2 2000 1999
---- ----
Revenues:
Interest Income $ 17,462 $ 16,217
------------ ------------
Expenses:
Asset Management Fee-General Partner 34,256 34,324
General and Administrative:
General Partner 5,092 4,478
Other 6,299 7,343
Amortization 1,632 2,424
------------ ------------
Total Expenses 47,279 48,569
------------ ------------
Loss Before Equity in Losses of
Project Partnerships (29,817) (32,352)
Equity in Losses of Project Partnerships (110,803) (121,407)
------------ ------------
Net Loss $ (140,620) $ (153,759)
============ ============
Allocation of Net Loss:
Assignees $ (139,214) $ (152,221)
General Partners (1,406) (1,538)
------------ ------------
$ (140,620) $ (153,759)
============ ============
Net Loss Per Beneficial
Assignee Certificate $ (22.69) $ (24.81)
Number of Beneficial Assignee ============ ============
Certificates Outstanding 6,136 6,136
============ ============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF OPERATIONS
FOR THE SIX MONTHS ENDED SEPTEMBER 30,
(Unaudited)
SERIES 3 2000 1999
---- ----
Revenues:
Interest Income $ 15,050 $ 14,135
------------ ------------
Expenses:
Asset Management Fee-General Partner 31,650 31,740
General and Administrative:
General Partner 5,323 4,681
Other 6,256 6,939
Amortization 560 1,520
------------ ------------
Total Expenses 43,789 44,880
------------ ------------
Loss Before Equity in Losses of
Project Partnerships (28,739) (30,745)
Equity in Losses of Project Partnerships (19,835) (50,563)
------------ ------------
Net Loss $ (48,574) $ (81,308)
============ ============
Allocation of Net Loss:
Assignees $ (48,088) $ (80,495)
General Partners (486) (813)
------------ ------------
$ (48,574) $ (81,308)
============ ============
Net Loss Per Beneficial
Assignee Certificate $ (8.81) $ (14.75)
Number of Beneficial Assignee ============ ============
Certificates Outstanding 5,456 5,456
============ ============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF OPERATIONS
FOR THE SIX MONTHS ENDED SEPTEMBER 30,
(Unaudited)
SERIES 4 2000 1999
---- ----
Revenues:
Interest Income $ 19,834 $ 18,609
------------ ------------
Expenses:
Asset Management Fee-General Partner 38,916 38,994
General and Administrative:
General Partner 6,711 5,898
Other 7,764 8,296
Amortization 3,328 3,864
------------ ------------
Total Expenses 56,719 57,052
------------ ------------
Loss Before Equity in Losses of
Project Partnerships (36,885) (38,443)
Equity in Losses of Project Partnerships (120,592) (126,996)
------------ ------------
Net Loss $ (157,477) $ (165,439)
============ ============
Allocation of Net Loss:
Assignees $ (155,902) $ (163,785)
General Partners (1,575) (1,654)
------------ ------------
$ (157,477) $ (165,439)
============ ============
Net Loss Per Beneficial Assignee
Certificate $ (22.55) $ (23.69)
Number of Beneficial Assignee ============ ============
Certificates Outstanding 6,915 6,915
============ ============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF OPERATIONS
FOR THE SIX MONTHS ENDED SEPTEMBER 30,
(Unaudited)
SERIES 5 2000 1999
---- ----
Revenues:
Interest Income $ 25,651 $ 23,846
------------ ------------
Expenses:
Asset Management Fee-General Partner 48,120 48,230
General and Administrative:
General Partner 8,332 7,327
Other 9,677 10,339
Amortization 3,080 3,264
------------ ------------
Total Expenses 69,209 69,160
------------ ------------
Loss Before Equity in Losses of
Project Partnerships (43,558) (45,314)
Equity in Losses of Project Partnerships (135,616) (112,020)
------------ ------------
Net Loss $ (179,174) $ (157,334)
============ ============
Allocation of Net Loss:
Assignees $ (177,382) $ (155,761)
General Partners (1,792) (1,573)
------------ ------------
$ (179,174) $ (157,334)
============ ============
Net Loss Per Beneficial Assignee
Certificate $ (20.59) $ (18.08)
Number of Beneficial Assignee ============ ============
Certificates Outstanding 8,616 8,616
============ ============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF OPERATIONS
FOR THE SIX MONTHS ENDED SEPTEMBER 30,
(Unaudited)
SERIES 6 2000 1999
---- ----
Revenues:
Interest Income $ 25,259 $ 22,760
------------ ------------
Expenses:
Asset Management Fee-General Partner 52,844 53,408
General and Administrative:
General Partner 8,795 7,734
Other 10,302 10,975
Amortization 7,490 8,028
------------ ------------
Total Expenses 79,431 80,145
------------ ------------
Loss Before Equity in Losses of
Project Partnerships (54,172) (57,385)
Equity in Losses of Project Partnerships (281,712) (337,943)
------------ ------------
Net Loss $ (335,884) $ (395,328)
============ ============
Allocation of Net Loss:
Assignees $ (332,525) $ (391,375)
General Partners (3,359) (3,953)
------------ ------------
$ (335,884) $ (395,328)
============ ============
Net Loss Per Beneficial Assignee
Certificate $ (32.91) $ (38.73)
Number of Beneficial Assignee ============ ============
Certificates Outstanding 10,105 10,105
============ ============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF OPERATIONS
FOR THE SIX MONTHS ENDED SEPTEMBER 30,
(Unaudited)
TOTAL SERIES 2 - 6 2000 1999
---- ----
Revenues:
Interest Income $ 103,256 $ 95,567
------------ ------------
Expenses:
Asset Management Fee-General Partner 205,786 206,696
General and Administrative:
General Partner 34,253 30,118
Other 40,298 43,892
Amortization 16,090 19,100
------------ ------------
Total Expenses 296,427 299,806
------------ ------------
Loss Before Equity in Losses of
Project Partnerships (193,171) (204,239)
Equity in Losses of Project Partnerships (668,558) (748,929)
------------ ------------
Net Loss $ (861,729) $ (953,168)
============ ============
Allocation of Net Loss:
Assignees $ (853,113) $ (943,637)
General Partners (8,616) (9,531)
------------ ------------
$ (861,729) $ (953,168)
============ ============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF PARTNERS' EQUITY (DEFICIT)
FOR THE SIX MONTHS ENDED SEPTEMBER 30, 2000 AND 1999
(Unaudited)
General
SERIES 2 Assignees Partners Total
--------- -------- -----
Balance at March 31, 1999 $ 530,860 $ (48,981) $ 481,879
Net Loss (152,221) (1,538) (153,759)
------------- ------------ -------------
Balance at September 30,1999 $ 378,639 $ (50,519) $ 328,120
============= ============ =============
Balance at March 31, 2000 $ 365,987 $ (50,646) $ 315,341
Net Loss (139,214) (1,406) (140,620)
------------- ------------ -------------
Balance at September 30,2000 $ 226,773 $ (52,052) $ 174,721
============= ============ =============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF PARTNERS' EQUITY (DEFICIT)
FOR THE SIX MONTHS ENDED SEPTEMBER 30, 2000 AND 1999
(Unaudited)
General
SERIES 3 Assignees Partners Total
--------- -------- -----
Balance at March 31, 1999 $ 417,412 $ (44,082) $ 373,330
Net Loss (80,495) (813) (81,308)
------------- ------------ -------------
Balance at September 30,1999 $ 336,917 $ (44,895) $ 292,022
============= ============ =============
Balance at March 31, 2000 $ 271,815 $ (45,553) $ 226,262
Net Loss (48,088) (486) (48,574)
------------- ------------ -------------
Balance at September 30,2000 $ 223,727 $ (46,039) $ 177,688
============= ============ =============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF PARTNERS' EQUITY (DEFICIT)
FOR THE SIX MONTHS ENDED SEPTEMBER 30, 2000 AND 1999
(Unaudited)
General
SERIES 4 Assignees Partners Total
--------- -------- -----
Balance at March 31, 1999 $ 965,972 $ (51,509) $ 914,463
Net Loss (163,785) (1,654) (165,439)
------------- ------------ -------------
Balance at September 30,1999 $ 802,187 $ (53,163) $ 749,024
============= ============ =============
Balance at March 31, 1999 $ 732,836 $ (53,864) $ 678,972
Net Loss (155,902) (1,575) (157,477)
------------- ------------ -------------
Balance at September 30,2000 $ 576,934 $ (55,439) $ 521,495
============= ============ =============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF PARTNERS' EQUITY (DEFICIT)
FOR THE SIX MONTHS ENDED SEPTEMBER 30, 2000 AND 1999
(Unaudited)
General
SERIES 5 Assignees Partners Total
--------- -------- -----
Balance at March 31, 1999 $ 1,613,346 $ (60,091) $ 1,553,255
Net Loss (155,761) (1,573) (157,334)
------------- ------------ -------------
Balance at September 30,1999 $ 1,457,585 $ (61,664) $ 1,395,921
============= ============ =============
Balance at March 31, 2000 $ 1,371,804 $ (62,531) $ 1,309,273
Net Loss (177,382) (1,792) (179,174)
------------- ------------ -------------
Balance at September 30,2000 $ 1,194,422 $ (64,323) $ 1,130,099
============= ============ =============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF PARTNERS' EQUITY (DEFICIT)
FOR THE SIX MONTHS ENDED SEPTEMBER 30, 2000 AND 1999
(Unaudited)
General
SERIES 6 Assignees Partners Total
--------- -------- -----
Balance at March 31, 1999 $ 2,877,858 $ (60,553) $ 2,817,305
Net Loss (391,375) (3,953) (395,328)
------------- ------------ -------------
Balance at September 30,1999 $ 2,486,483 $ (64,506) $ 2,421,977
============= ============ =============
Balance at March 31, 2000 $ 2,351,230 $ (65,872) $ 2,285,358
Net Loss (332,525) (3,359) (335,884)
------------- ------------ -------------
Balance at September 30,2000 $ 2,018,705 $ (69,231) $ 1,949,474
============= ============ =============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF PARTNERS' EQUITY (DEFICIT)
FOR THE SIX MONTHS ENDED SEPTEMBER 30, 2000 AND 1999
(Unaudited)
General
TOTAL SERIES 2 - 6 Assignees Partners Total
--------- -------- -----
Balance at March 31, 1999 $ 6,405,448 $ (265,216) $ 6,140,232
Net Loss (943,637) (9,531) (953,168)
------------- ------------ -------------
Balance at September 30,1999 $ 5,461,811 $ (274,747) $ 5,187,064
============= ============ =============
Balance at March 31, 2000 $ 5,093,672 $ (278,466) $ 4,815,206
Net Loss (853,113) (8,616) (861,729)
------------- ------------ -------------
Balance at September 30,2000 $ 4,240,559 $ (287,082) $ 3,953,477
============= ============ =============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF CASH FLOWS
FOR THE SIX MONTHS ENDED SEPTEMBER 30, 2000 AND 1999
(Unaudited)
SERIES 2 2000 1999
-------- ---- ----
Cash Flows from Operating Activities:
Net Loss $ (140,620) $ (153,759)
Adjustments to Reconcile Net Loss to Net
Cash Used in Operating Activities:
Amortization 1,632 2,424
Accreted Interest Income on Investments
in Securities (10,734) (11,741)
Equity in Losses of Project
Partnerships 110,803 121,407
Interest Income from Redemption of
Securities 23,536 20,241
Changes in Operating Assets and
Liabilities:
Increase (Decrease) in Payable to
General Partners (318) 3,156
------------ ------------
Net Cash Used in Operating
Activities (15,701) (18,272)
------------ ------------
Cash Flows from Investing Activities:
Distributions Received from Project
Partnerships 5,377 4,156
Redemption of Investment in Securities 28,263 29,297
------------ ------------
Net Cash Provided by Investing
Activities 33,640 33,453
------------ ------------
Increase in Cash and Cash Equivalents 17,939 15,181
Cash and Cash Equivalents at Beginning
of Year 188,570 169,513
------------ ------------
Cash and Cash Equivalents at End of Year $ 206,509 $ 184,694
============ ============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF CASH FLOWS
FOR THE SIX MONTHS ENDED SEPTEMBER 30, 2000 AND 1999
(Unaudited)
SERIES 3 2000 1999
-------- ---- ----
Cash Flows from Operating Activities:
Net Loss $ (48,574) $ (81,308)
Adjustments to Reconcile Net Loss to Net
Cash Used in Operating Activities:
Amortization 560 1,520
Accreted Interest Income on Investments
in Securities (9,547) (10,444)
Equity in Losses of Project
Partnerships 19,835 50,563
Interest Income from Redemption of
Securities 20,936 18,004
Changes in Operating Assets and
Liabilities:
Decrease in Payable to General
Partners (7,694) (8,231)
------------ ------------
Net Cash Used in Operating
Activities (24,484) (29,896)
------------ ------------
Cash Flows from Investing Activities:
Distributions Received from Project
Partnerships 13,890 13,944
Redemption of Investment in Securities 25,139 26,059
------------ ------------
Net Cash Provided by Investing
Activities 39,029 40,003
------------ ------------
Increase in Cash and Cash Equivalents 14,545 10,107
Cash and Cash Equivalents at Beginning of
Year 155,487 137,981
------------ ------------
Cash and Cash Equivalents at End of Year $ 170,032 $ 148,088
============ ============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF CASH FLOWS
FOR THE SIX MONTHS ENDED SEPTEMBER 30, 2000 AND 1999
(Unaudited)
SERIES 4 2000 1999
-------- ---- ----
Cash Flows from Operating Activities:
Net Loss $ (157,477) $ (165,439)
Adjustments to Reconcile Net Loss to Net
Cash Used in Operating Activities:
Amortization 3,328 3,864
Accreted Interest Income on Investments
in Securities (12,096) (13,231)
Equity in Losses of Project
Partnerships 120,592 126,996
Interest Income from Redemption of
Securities 26,523 22,808
Changes in Operating Assets and
Liabilities:
Decrease in Payable to General
Partners (3,696) (1,477)
------------ ------------
Net Cash Used in Operating
Activities (22,826) (26,479)
------------ ------------
Cash Flows from Investing Activities:
Distributions Received from Project
Partnerships 11,039 10,998
Redemption of Investment in Securities 31,849 33,015
------------ ------------
Net Cash Provided by Investing
Activities 42,888 44,013
------------ ------------
Increase in Cash and Cash Equivalents 20,062 17,534
Cash and Cash Equivalents at Beginning of
Year 226,648 207,632
------------ ------------
Cash and Cash Equivalents at End of Year $ 246,710 $ 225,166
============ ============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF CASH FLOWS
FOR THE SIX MONTHS ENDED SEPTEMBER 30, 2000 AND 1999
(Unaudited)
SERIES 5 2000 1999
-------- ---- ----
Cash Flows from Operating Activities:
Net Loss $ (179,174) $ (157,334)
Adjustments to Reconcile Net Loss to Net
Cash Used in Operating Activities:
Amortization 3,080 3,264
Accreted Interest Income on Investments
in Securities (15,076) (16,491)
Equity in Losses of Project
Partnerships 135,616 112,020
Interest Income from Redemption of
Securities 33,057 28,428
Changes in Operating Assets and
Liabilities:
Decrease in Payable to General
Partners (10,728) (7,878)
------------ ------------
Net Cash Used in Operating
Activities (33,225) (37,991)
------------ ------------
Cash Flows from Investing Activities:
Distributions Received from Project
Partnerships 5,790 9,155
Redemption of Investment in Securities 39,696 41,148
------------ ------------
Net Cash Provided by Investing
Activities 45,486 50,303
------------ ------------
Increase in Cash and Cash Equivalents 12,261 12,312
Cash and Cash Equivalents at Beginning of
Year 318,707 292,994
------------ ------------
Cash and Cash Equivalents at End of Year $ 330,968 $ 305,306
============ ============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF CASH FLOWS
FOR THE SIX MONTHS ENDED SEPTEMBER 30, 2000 AND 1999
(Unaudited)
SERIES 6 2000 1999
-------- ---- ----
Cash Flows from Operating Activities:
Net Loss $ (335,884) $ (395,328)
Adjustments to Reconcile Net Loss to Net
Cash Used in Operating Activities:
Amortization 7,490 8,028
Accreted Interest Income on Investments
in Securities (13,468) (14,208)
Equity in Losses of Project
Partnerships 281,712 337,943
Changes in Operating Assets and
Liabilities:
Increase (Decrease) in Payable to
General Partners (3,508) 54
------------ ------------
Net Cash Used in Operating
Activities (63,658) (63,511)
------------ ------------
Cash Flows from Investing Activities:
Distributions Received from Project
Partnerships 7,416 9,466
Redemption of Investment in Securities 0 0
------------ ------------
Net Cash Provided by Investing
Activities 7,416 9,466
------------ ------------
Decrease in Cash and Cash Equivalents (56,242) (54,045)
Cash and Cash Equivalents at Beginning of
Year 422,800 408,672
------------ ------------
Cash and Cash Equivalents at End of Year $ 366,558 $ 354,627
============ ============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF CASH FLOWS
FOR THE SIX MONTHS ENDED SEPTEMBER 30, 2000 AND 1999
(Unaudited)
TOTAL SERIES 2 - 6 2000 1999
-------- ---- ----
Cash Flows from Operating Activities:
Net Loss $ (861,729) $ (953,168)
Adjustments to Reconcile Net Loss to Net
Cash Used in Operating Activities:
Amortization 16,090 19,100
Accreted Interest Income on Investments
in Securities (60,921) (66,115)
Equity in Losses of Project
Partnerships 668,558 748,929
Interest Income from Redemption of
Securities 104,052 89,481
Changes in Operating Assets and
Liabilities:
Decrease in Payable to General
Partners (25,944) (14,376)
------------ ------------
Net Cash Used in Operating
Activities (159,894) (176,149)
------------ ------------
Cash Flows from Investing Activities:
Distributions Received from Project
Partnerships 43,512 47,719
Redemption of Investment in Securities 124,947 129,519
------------ ------------
Net Cash Provided by Investing
Activities 168,459 177,238
------------ ------------
Increase in Cash and Cash Equivalents 8,565 1,089
Cash and Cash Equivalents at Beginning of
Year 1,312,212 1,216,792
------------ ------------
Cash and Cash Equivalents at End of Year $ 1,320,777 $ 1,217,881
============ ============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
SEPTEMBER 30, 2000
NOTE 1 - ORGANIZATION:
Gateway Tax Credit Fund II Ltd. ("Gateway"), a Florida Limited Partnership,
was formed September 12, 1989, under the laws of Florida. Operations
commenced on September 14, 1990 for Series 2, September 28, 1990 for Series
3, February 1, 1991 for Series 4, July 1, 1991 for Series 5 and January 1,
1992 for Series 6. Gateway has invested, as a limited partner, in other
limited partnerships ("Project Partnerships") each of which owns and operates
one or more apartment complexes expected to qualify for Low-Income Housing
Tax Credits. Gateway will terminate on December 31, 2040, or sooner, in
accordance with the terms of the Limited Partnership Agreement. As of
September 30, 2000, Gateway had received capital contributions of $1,000 from
the General Partners and $37,228,000 from Beneficial Assignee Certificate
investors (the "Assignees"). The fiscal year of Gateway for reporting
purposes ends on March 31.
Pursuant to the Securities Act of 1933, Gateway filed a Form S-11
Registration Statement with the Securities and Exchange Commission, effective
September 12, 1989, which covered the offering (the "Public Offering") of
Gateway's Beneficial Assignee Certificates ("BACs") representing assignments
of units for the beneficial interest of the limited partnership interest of
the Assignor Limited Partner. The Assignor Limited Partner was formed for
the purpose of serving in that capacity for the Fund and will not engage in
any other business.
Raymond James Partners, Inc. and Raymond James Tax Credit Funds, Inc.,
wholly-owned subsidiaries of Raymond James Financial, Inc., are the General
Partner and the Managing General Partner, respectively. The Managing General
Partner manages and controls the business of Gateway.
Gateway offered BACs in five series. BACs in the amounts of $6,136,000,
$5,456,000, $6,915,000, $8,616,000 and $10,105,000 for Series 2, 3, 4, 5 and
6, respectively had been issued as of March 31, 1997. Each Series is treated
as a separate partnership, investing in a separate and distinct pool of
Project Partnerships. Net proceeds from each Series are used to acquire
Project Partnerships which are specifically allocated to such Series. Income
or loss and all tax items from the Project Partnerships acquired by each
Series are specifically allocated among the Assignees of such Series.
Operating profits and losses, cash distributions from operations and tax
credits are allocated 99% to the Assignees and 1% to the General Partners.
Profit or loss and cash distributions from sales of properties will be
allocated as formulated in the Limited Partnership Agreement.
NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES:
Basis of Accounting
Gateway utilizes the accrual basis of accounting whereby revenues are
recognized when earned and expenses are recognized when obligations are
incurred.
Gateway accounts for its investments as the sole limited partner in Project
Partnerships ("Investments in Project Partnerships") using the equity method
of accounting, because management believes that Gateway does not have a
majority control of the major operating and financial policies of the Project
Partnerships in which it invests, and reports the equity in losses of the
Project Partnerships on a 3-month lag in the Statements of Operations. Under
the equity method, the Investments in Project Partnerships initially include:
1) Gateway's capital contribution,
2) Acquisition fees paid to the General Partner for services rendered
in selecting properties for acquisition, and
3) Acquisition expenses including legal fees, travel and other
miscellaneous costs relating to acquiring properties.
Quarterly the Investments in Project Partnerships are increased or decreased
as follows:
1) Increased for equity in income or decreased for equity in losses of
the Project Partnerships,
2) Decreased for cash distributions received from the Project
Partnerships, and
3) Decreased for the amortization of the acquisition fees and expenses.
Amortization is calculated on a straight-line basis over 35 years, as this
is the average estimated useful life of the underlying assets. The
amortization is shown as amortization expense on the Statements of
Operations.
Pursuant to the limited partnership agreements for the Project Partnerships,
cash losses generated by the Project Partnerships are allocated to the
general partners of those partnerships. In subsequent years, cash profits,
if any, are first allocated to the general partners to the extent of the
allocation of prior years' cash losses.
Since Gateway invests as a limited partner, and therefore is not obligated
to fund losses or make additional capital contributions, it does not
recognize losses from individual Project Partnerships to the extent that
these losses would reduce the investment in those Project Partnerships below
zero. The suspended losses will be used to offset future income from the
individual Project Partnerships.
Gateway recognizes a decline in the carrying value of its investment in the
Project Partnerships when there is evidence of a non-temporary decline in the
recoverable amount of the investment. There is a possibility that the
estimates relating to reserves for non-temporary declines in carrying value
of the investments in Project Partnerships may be subject to material near
term adjustments.
Gateway, as a limited partner in the Project Partnerships, is subject to
risks inherent in the ownership of property which are beyond its control,
such as fluctuations in occupancy rates and operating expenses, variations in
rental schedules, proper maintenance and continued eligibility of tax
credits. If the cost of operating a property exceeds the rental income
earned thereon, Gateway may deem it in its best interest to voluntarily
provide funds in order to protect its investment.
Cash and Cash Equivalents
It is Gateway's policy to include short-term investments with an original
maturity of three months or less in Cash and Cash Equivalents. Short-term
investments are comprised of money market mutual funds.
Concentration of Credit Risk
Financial instruments which potentially subject Gateway to concentrations of
credit risk consist of cash investments in a money market mutual fund that is
a wholly-owned subsidiary of Raymond James Financial, Inc.
Use of Estimates in the Preparation of Financial Statements
The preparation of financial statements in conformity with generally
accepted accounting principles requires the use of estimates that affect
certain reported amounts and disclosures. These estimates are based on
management's knowledge and experience. Accordingly, actual results could
differ from these estimates.
Investment in Securities
Effective April 1, 1995, Gateway adopted Statement of Financial Accounting
Standards No. 115, Accounting for Certain Investments in Debt and Equity
Securities ("FAS 115"). Under FAS 115, Gateway is required to categorize its
debt securities as held-to-maturity, available-for-sale or trading
securities, dependent upon Gateway's intent in holding the securities.
Gateway's intent is to hold all of its debt securities (U. S. Government
Security Strips) until maturity and to use these reserves to fund Gateway's
ongoing operations. Interest income is recognized ratably on the U. S.
Government Strips using the effective yield to maturity.
Offering and Commission Costs
Offering and commission costs were charged against Assignees' Equity upon
the admission of Limited Partners.
Income Taxes
No provision for income taxes has been made in these financial statements,
as income taxes are a liability of the partners rather than of Gateway.
Reclassifications
For comparability, the 1999 figures have been reclassified, where
appropriate, to conform with the financial statement presentation used in
2000.
Basis of Preparation
The unaudited financial statements presented herein have been prepared in
accordance with the instructions to Form 10-Q 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 Partnership's Form
10-K for the year ended March 31, 2000. In the opinion of management these
financial statements include adjustments, consisting only of normal recurring
adjustments, necessary to fairly summarize the Partnership'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.
NOTE 3 - INVESTMENT IN SECURITIES:
The September 30, 2000 Balance Sheet includes Investment in Securities
consisting of U.S. Government Security Strips which represents their cost,
plus accreted interest income of $139,844 for Series 2, $124,388 for Series
3, $157,588 for Series 4, $196,414 for Series 5 and $167,200 for Series 6.
For convenience, the Investment in Securities are commonly held in a
brokerage account with Raymond James and Associates, Inc. A separate
accounting is maintained for each series' share of the investments.
Gross Unrealized
Estimated Market Cost Plus Gains and
Value Accreted Interest (Losses)
----------------- ----------------- ----------------
Series 2 $ 298,143 $ 285,216 $ 12,927
Series 3 265,105 253,693 11,412
Series 4 335,993 321,403 14,590
Series 5 418,643 400,589 18,054
Series 6 401,925 386,647 15,278
As of September 30, 2000, the cost and accreted interest of debt securities
by contractual maturities is as follows:
Series 2 Series 3 Series 4
-------- -------- --------
Due within 1 year $ 51,932 $ 46,192 $ 58,521
After 1 year through 5 years 190,147 169,132 214,274
After 5 years through 10 years 43,137 38,369 48,608
---------- ---------- ----------
Total Amount Carried on
Balance Sheet $ 285,216 $ 253,693 $ 321,403
========== ========== ==========
Series 5 Series 6 Total
-------- -------- --------
Due within 1 year $ 72,939 $ 56,952 $ 286,536
After 1 year through 5 years 267,064 224,010 1,064,627
After 5 years through 10 years 60,586 105,685 296,385
---------- ---------- ----------
Total Amount Carried on
Balance Sheet $ 400,589 $ 386,647 $1,647,548
========== ========== ==========
NOTE 4 - RELATED PARTY TRANSACTIONS:
The Payable to General Partners primarily represents the asset management
fees owed to the General Partners at the end of the period. It is unsecured,
due on demand and, in accordance with the limited partnership agreement, non-
interest bearing. Within the next 12 months, the Managing General Partner
does not intend to demand payment on the portion of Asset Management Fees
payable classified as long-term on the Balance Sheet.
The Payable to Project Partnerships represents unpaid capital contributions
to the Project Partnerships and will be paid after certain performance
criteria are met. Such contributions are in turn payable to the general
partner of the Project Partnerships.
For the six months ended September 30, 2000 and 1999 the General Partners and
affiliates are entitled to compensation and reimbursement for costs and
expenses incurred by Gateway as follows:
Asset Management Fee - The Managing General Partner is entitled to be paid
an annual asset management fee equal to 0.25% of the aggregate cost of
Gateway's interest in the projects owned by the Project Partnerships. The
asset management fee will be paid only after all other expenses of Gateway
have been paid. These fees are included in the Statements of Operations.
2000 1999
---- ------
Series 2 $ 34,256 $ 34,324
Series 3 31,650 31,740
Series 4 38,916 38,994
Series 5 48,120 48,230
Series 6 52,844 53,408
--------- ---------
Total $ 205,786 $ 206,696
========= =========
General and Administrative Expenses - The Managing General Partner is reim
bursed for general and administrative expenses of Gateway on an accountable
basis. This expense is included in the Statements of Operations.
Series 2 $ 5,092 $ 4,478
Series 3 5,323 4,681
Series 4 6,711 5,898
Series 5 8,332 7,327
Series 6 8,795 7,734
--------- --------
Total $ 34,253 $ 30,118
========= ========
NOTE 5 - INVESTMENTS IN PROJECT PARTNERSHIPS:
As of September 30, 2000, the Partnership had acquired a 99% interest in
the profits, losses and tax credits as a limited partner in 148 Project
Partnerships for the Series which own and operate government assisted multi-
family housing complexes(Series 2 - 22,Series 3 - 23, Series 4 - 29, Series 5
- 36 and Series 6 - 38).
Cash flows from operations are allocated according to each partnership
agreement. Upon dissolution proceeds will be distributed according to each
partnership agreement.
The following is a summary of Investments in Project Partnerships as of:
SERIES 2 SEPTEMBER 30, MARCH 31,
2000 2000
-------------- ----------
Capital Contributions to Project Partner-
ships and purchase price paid for limited
partner interests in Project Partnerships $ 4,524,678 $ 4,524,678
Cumulative equity in losses of Project
Partnerships (1) (4,664,029) (4,553,226)
Cumulative distributions received from (79,588) (74,211)
Project Partnerships ------------ -------------
Investment in Project Partnerships before
Adjustment (218,939) (102,759)
Excess of investment cost over the
underlying assets acquired:
Acquisition fees and expenses 390,838 390,838
Accumulated amortization of acquisition
fees and expenses (81,496) (79,864)
----------- ------------
Investments in Project Partnerships $ 90,403 $ 208,215
============ ============
(1) In accordance with the Partnership's accounting policy to not carry
Investments in Project Partnerships below zero, cumulative suspended losses
of $2,031,378 for the period ended September 30, 2000 and cumulative
suspended losses of $1,743,287 for the year ended March 31, 1999 are not
included.
The following is a summary of Investments in Project Partnerships as of:
SERIES 3 SEPTEMBER 30, MARCH 31,
2000 2000
-------------- ----------
Capital Contributions to Project Partner-
ships and purchase price paid for limited
partner interests in Project Partnerships $ 3,888,713 $ 3,888,713
Cumulative equity in losses of Project
Partnerships (1) (4,062,136) (4,042,301)
Cumulative distributions received from
Project Partnerships (172,566) (158,676)
----------- -------------
Investment in Project Partnerships before
Adjustment (345,989) (312,264)
Excess of investment cost over the
underlying assets acquired:
Acquisition fees and expenses 491,746 491,746
Accumulated amortization of acquisition
fees and expenses (79,852) (79,292)
----------- ------------
Investments in Project Partnerships $ 65,905 $ 100,190
============ ============
(1) In accordance with the Partnership's accounting policy to not carry
Investments in Project Partnerships below zero, cumulative suspended losses
of $2,922,599 for the period ended September 30, 2000 and cumulative
suspended losses of $2,455,000 for the year ended March 31, 2000 are not
included.
The following is a summary of Investments in Project Partnerships as of:
SERIES 4 SEPTEMBER 30, MARCH 31,
2000 2000
-------------- ----------
Capital Contributions to Project Partner-
ships and purchase price paid for limited
partner interests in Project Partnerships $ 4,952,519 $ 4,952,519
Cumulative equity in losses of Project
Partnerships (1) (4,930,601) (4,810,009)
Cumulative distributions received from
Project Partnerships (118,206) (107,167)
----------- -------------
Investment in Project Partnerships before
Adjustment (96,288) 35,343
Excess of investment cost over the
underlying assets acquired:
Acquisition fees and expenses 562,967 562,967
Accumulated amortization of acquisition
fees and expenses (113,946) (110,618)
----------- ------------
Investments in Project Partnerships $ 352,733 $ 487,692
============ ============
(1) In accordance with the Partnership's accounting policy to not carry
Investments in Project Partnerships below zero, cumulative suspended losses
of $1,800,186 for the period ended September 30, 2000 and cumulative
suspended losses of $1,531,158 for the year ended March 31, 2000 are not
included.
The following is a summary of Investments in Project Partnerships as of:
SERIES 5 SEPTEMBER 30, MARCH 31,
2000 2000
-------------- ----------
Capital Contributions to Project Partner-
ships and purchase price paid for limited
partner interests in Project Partnerships $ 6,164,472 $ 6,164,472
Cumulative equity in losses of Project
Partnerships (1) (5,721,155) (5,585,539)
Cumulative distributions received from
Project Partnerships (162,338) (156,548)
----------- -------------
Investment in Project Partnerships before
Adjustment 280,979 422,385
Excess of investment cost over the
underlying assets acquired:
Acquisition fees and expenses 650,837 650,837
Accumulated amortization of acquisition
fees and expenses (124,853) (121,773)
------------ ------------
Investments in Project Partnerships $ 806,963 $ 951,449
============ ============
(1) In accordance with the Partnership's accounting policy to not carry
Investments in Project Partnerships below zero, cumulative suspended losses
of $2,081,674 for the period ended September 30, 2000 and cumulative
suspended losses of $1,642,901 for the year ended March 31, 2000 are not
included.
The following is a summary of Investments in Project Partnerships as of:
SERIES 6 SEPTEMBER 30, MARCH 31,
2000 2000
-------------- ----------
Capital Contributions to Project Partner-
ships and purchase price paid for limited
partner interests in Project Partnerships $ 7,462,215 $ 7,462,215
Cumulative equity in losses of Project
Partnerships (1) (6,211,533) (5,929,821)
Cumulative distributions received from
Project Partnerships (171,189) (163,773)
------------ -------------
Investment in Project Partnerships before
Adjustment 1,079,493 1,368,621
Excess of investment cost over the
underlying assets acquired:
Acquisition fees and expenses 785,179 785,179
Accumulated amortization of acquisition
fees and expenses (163,900) (156,410)
------------ ------------
Investments in Project Partnerships $ 1,700,772 $ 1,997,390
============ ============
(1) In accordance with the Partnership's accounting policy to not carry
Investments in Project Partnerships below zero, cumulative suspended losses
of $1,316,110 for the period ended September 30, 2000 and cumulative
suspended losses of $1,029,135 for the year ended March 31, 2000 are not
included.
The following is a summary of Investments in Project Partnerships as of:
TOTAL SERIES 2 - 6 SEPTEMBER 30, MARCH 31,
2000 2000
-------------- ----------
Capital Contributions to Project Partner-
ships and purchase price paid for limited
partner interests in Project Partnerships $ 26,992,597 $ 26,992,597
Cumulative equity in losses of Project
Partnerships (1) (25,589,454) (24,920,896)
Cumulative distributions received from
Project Partnerships (703,887) (660,375)
----------- -------------
Investment in Project Partnerships before
Adjustment 699,256 1,411,326
Excess of investment cost over the
underlying assets acquired:
Acquisition fees and expenses 2,881,567 2,881,567
Accumulated amortization of acquisition
fees and expenses (564,047) (547,957)
----------- ------------
Investments in Project Partnerships $ 3,016,776 $ 3,744,936
============ ============
In accordance with the Partnership's policy of presenting the financial
information of the Project Partnerships on a three month lag, below is the
summarized financial information for the Series' Project Partnerships as of
June 30, of each year:
JUNE 30,
2000 1999
SERIES 2 ---- ----
SUMMARIZED BALANCE SHEETS
Assets:
Current assets $ 2,003,116 $ 1,816,046
Investment properties, net 19,440,706 20,322,293
Other assets 1,646 14,201
----------- -----------
Total assets $21,445,468 $22,152,540
=========== ===========
Liabilities and Partners' Equity:
Current liabilities $ 574,758 $ 568,789
Long-term debt 23,102,611 23,155,354
----------- -----------
Total liabilities 23,677,369 23,724,143
----------- -----------
Partners' equity
Limited Partner (2,232,707) (1,592,829)
General Partners 806 21,226
----------- -----------
Total Partners' equity (2,231,901) (1,571,603)
----------- -----------
Total liabilities and partners'
equity $21,445,468 $22,152,540
=========== ===========
SUMMARIZED STATEMENTS OF OPERATIONS
Rental and other income $ 1,416,685 $ 1,240,418
Expenses: ----------- -----------
Operating expenses 917,289 942,468
Interest expense 453,713 330,924
Depreciation and amortization 448,606 458,920
----------- -----------
Total expenses 1,819,608 1,732,312
----------- -----------
Net loss $ (402,923) $ (491,894)
=========== ===========
Other partners' share of net loss $ (4,029) $ (4,919)
=========== ===========
Partnerships' share of net loss $ (398,894) $ (486,975)
Suspended losses 288,091 365,568
----------- -----------
Equity in Losses of Project Partnerships $ (110,803) $ (121,407)
=========== ===========
In accordance with the Partnership's policy of presenting the financial
information of the Project Partnerships on a three month lag, below is the
summarized financial information for the Series' Project Partnerships as of
June 30, of each year:
JUNE 30,
2000 1999
SERIES 3 ---- ----
SUMMARIZED BALANCE SHEETS
Assets:
Current assets $ 2,108,779 $ 2,215,363
Investment properties, net 16,463,288 17,622,467
Other assets 198,473 212,916
----------- -----------
Total assets $18,770,540 $20,050,746
=========== ===========
Liabilities and Partners' Equity:
Current liabilities $ 483,987 $ 533,518
Long-term debt 21,628,968 21,693,402
----------- -----------
Total liabilities 22,112,955 22,226,920
----------- -----------
Partners' equity
Limited Partner (3,555,582) (2,429,165)
General Partners 213,167 252,991
----------- -----------
Total Partners' equity (3,342,415) (2,176,174)
----------- -----------
Total liabilities and partners'
equity $18,770,540 $20,050,746
=========== ===========
SUMMARIZED STATEMENTS OF OPERATIONS
Rental and other income $ 1,272,072 $ 1,218,434
Expenses: ----------- -----------
Operating expenses 986,004 826,215
Interest expense 316,561 314,660
Depreciation and amortization 463,544 452,925
----------- -----------
Total expenses 1,766,109 1,593,800
----------- -----------
Net loss $ (494,037) $ (375,366)
=========== ===========
Other partners' share of net loss $ (6,603) $ (3,754)
=========== ===========
Partnerships' share of net loss $ (487,434) $ (371,612)
Suspended losses 467,599 321,049
----------- -----------
Equity in Losses of Project Partnerships $ (19,835) $ (50,563)
=========== ===========
In accordance with the Partnership's policy of presenting the financial
information of the Project Partnerships on a three month lag, below is the
summarized financial information for the Series' Project Partnerships as of
June 30, of each year:
JUNE 30,
2000 1999
SERIES 4 ---- ----
SUMMARIZED BALANCE SHEETS
Assets:
Current assets $ 2,492,590 $ 2,421,613
Investment properties, net 22,857,794 23,796,605
Other assets 33,935 25,015
----------- -----------
Total assets $25,384,319 $26,243,233
=========== ===========
Liabilities and Partners' Equity:
Current liabilities $ 772,440 $ 849,130
Long-term debt 26,353,796 26,350,949
----------- -----------
Total liabilities 27,126,236 27,200,079
----------- -----------
Partners' equity
Limited Partner (1,873,108) (1,137,532)
General Partners 131,191 180,686
----------- -----------
Total Partners' equity (1,741,917) (956,846)
----------- -----------
Total liabilities and partners'
equity $25,384,319 $26,243,233
=========== ===========
SUMMARIZED STATEMENTS OF OPERATIONS
Rental and other income $ 1,647,276 $ 1,500,178
Expenses: ----------- -----------
Operating expenses 1,092,497 1,030,493
Interest expense 458,189 334,559
Depreciation and amortization 491,450 507,620
----------- -----------
Total expenses 2,042,136 1,872,672
----------- -----------
Net loss $ (394,860) $ (372,494)
=========== ===========
Other partners' share of net loss $ (5,240) $ (3,725)
=========== ===========
Partnerships' share of net loss $ (389,620) $ (368,769)
Suspended losses 269,028 241,773
----------- -----------
Equity in Losses of Project Partnerships $ (120,592) $ (126,996)
=========== ===========
In accordance with the Partnership's policy of presenting the financial
information of the Project Partnerships on a three month lag, below is the
summarized financial information for the Series' Project Partnerships as of
June 30, of each year:
JUNE 30,
2000 1999
SERIES 5 ---- ----
SUMMARIZED BALANCE SHEETS
Assets:
Current assets $ 3,060,608 $ 2,943,437
Investment properties, net 28,592,878 29,808,118
Other assets 22,285 5,756
----------- -----------
Total assets $31,675,771 $32,757,311
=========== ===========
Liabilities and Partners' Equity:
Current liabilities $ 838,274 $ 1,026,137
Long-term debt 32,654,996 32,709,285
----------- -----------
Total liabilities 33,493,270 33,735,422
----------- -----------
Partners' equity
Limited Partner (1,710,701) (853,820)
General Partners (106,798) (124,291)
----------- -----------
Total Partners' equity (1,817,499) (978,111)
----------- -----------
Total liabilities and partners'
equity $31,675,771 $32,757,311
=========== ===========
SUMMARIZED STATEMENTS OF OPERATIONS
Rental and other income $ 1,859,179 $ 1,806,888
Expenses: ----------- -----------
Operating expenses 1,378,389 1,338,080
Interest expense 417,828 448,287
Depreciation and amortization 643,153 656,570
----------- -----------
Total expenses 2,439,370 2,442,937
----------- -----------
Net loss $ (580,191) $ (636,049)
=========== ===========
Other partners' share of net loss $ (5,802) $ (6,360)
=========== ===========
Partnerships' share of net loss $ (574,389) $ (629,689)
Suspended losses 438,773 517,669
----------- -----------
Equity in Losses of Project Partnerships $ (135,616) $ (112,020)
=========== ===========
In accordance with the Partnership's policy of presenting the financial
information of the Project Partnerships on a three month lag, below is the
summarized financial information for the Series' Project Partnerships as of
June 30, of each year:
JUNE 30,
2000 1999
SERIES 6 ---- ----
SUMMARIZED BALANCE SHEETS
Assets:
Current assets $ 3,179,341 $ 3,167,201
Investment properties, net 32,515,674 33,752,053
Other assets 13,038 15,073
----------- -----------
Total assets $35,708,053 $36,934,327
=========== ===========
Liabilities and Partners' Equity:
Current liabilities $ 724,555 $ 1,026,293
Long-term debt 35,459,556 35,485,020
----------- -----------
Total liabilities 36,184,111 36,511,313
----------- -----------
Partners' equity
Limited Partner (214,295) 639,094
General Partners (261,763) (216,080)
----------- -----------
Total Partners' equity (476,058) 423,014
----------- -----------
Total liabilities and partners' $35,708,053 $36,934,327
equity =========== ===========
SUMMARIZED STATEMENTS OF OPERATIONS
Rental and other income $ 2,011,038 $ 1,875,629
Expenses: ----------- -----------
Operating expenses 1,321,774 1,250,340
Interest expense 579,199 527,298
Depreciation and amortization 685,915 707,458
----------- -----------
Total expenses 2,586,888 2,485,096
----------- -----------
Net loss $ (575,850) $ (609,467)
=========== ===========
Other partners' share of net loss $ (7,163) $ (6,095)
=========== ===========
Partnerships' share of net loss $ (568,687) $ (603,372)
Suspended losses 286,975 265,429
----------- -----------
Equity in Losses of Project Partnerships $ (281,712) $ (337,943)
=========== ===========
In accordance with the Partnership's policy of presenting the financial
information of the Project Partnerships on a three month lag, below is the
summarized financial information for the Series' Project Partnerships as of
June 30, of each year:
JUNE 30,
2000 1999
TOTAL SERIES 2- 6 ---- ----
SUMMARIZED BALANCE SHEETS
Assets:
Current assets $ 12,844,434 $ 12,563,660
Investment properties, net 119,870,340 125,301,536
Other assets 269,377 272,961
------------ ------------
Total assets $132,984,151 $138,138,157
============ ============
Liabilities and Partners' Equity:
Current liabilities $ 3,394,014 $ 4,003,867
Long-term debt 139,199,927 139,394,010
------------ ------------
Total liabilities 142,593,941 143,397,877
------------ ------------
Partners' equity
Limited Partner (9,586,393) (5,374,252)
General Partners (23,397) 114,532
------------ ------------
Total Partners' equity (9,609,790) (5,259,720)
------------ ------------
Total liabilities and partners'
equity $132,984,151 $138,138,157
============ ============
SUMMARIZED STATEMENTS OF OPERATIONS
Rental and other income $ 8,206,250 $ 7,641,547
Expenses: ------------ ------------
Operating expenses 5,695,953 5,387,596
Interest expense 2,225,490 1,955,728
Depreciation and amortization 2,732,668 2,783,493
------------ ------------
Total expenses 10,654,111 10,126,817
------------ ------------
Net loss $ (2,447,861) $ (2,485,270)
============ ============
Other partners' share of net loss $ (28,837) $ (24,853)
============ ============
Partnerships' share of net loss $ (2,419,024) $ (2,460,417)
Suspended losses 1,750,466 1,711,488
------------ ------------
Equity in Losses of Project
Partnerships $ (668,558) $ (748,929)
============ ============
Item 7. Management's Discussion and Analysis of Financial Condition and
Results of Operations
Results of Operations, Liquidity and Capital Resources
Operations commenced on September 14, 1990, with the first admission of
Assignees in Series 2. The proceeds from Assignees' capital contributions
available for investment were used to acquire interests in Project
Partnerships.
As disclosed on the statement of operations for each Series, except as
described below, interest income is comparable for the six and three months
ended September 30, 2000 and September 30, 1999. The General and
Administrative expenses - General Partner and General and Administrative
expenses - Other for the six and three months ended September 30, 2000 are
comparable for the same period ended September 30, 1999. There were no
unusual variations in the operating results between these two periods.
The capital resources of each Series are used to pay General and
Administrative operating costs including personnel, supplies, data
processing, travel and legal and accounting associated with the
administration and monitoring of Gateway and the Project Partnerships. The
capital resources are also used to pay the Asset Management Fee due the
Managing General Partner, but only to the extent that Gateway's remaining
resources are sufficient to fund Gateway's ongoing needs. (Payment of any
Asset Management Fee unpaid at the time Gateway sells its interests in the
Project Partnerships is subordinated to the return of the investors' original
capital contributions).
The sources of funds to pay the operating costs of each Series are short
term investments and interest earned thereon, the maturity of U.S. Treasury
Security Strips ("Zero Coupon Treasuries") which were purchased with funds
set aside for this purpose, and cash distributed to the Series from the
operations of the Project Partnerships.
From inception, no Series has paid distributions and management does not
anticipate distributions in the future.
Series 2 - Gateway closed this series on September 14, 1990 after receiving
$6,136,000 from 375 Assignees. Equity in Losses of Project Partnerships for
the six months ended September 30, 1999 were comparable for the six months
ended September 30, 2000. In general, it is common in the real estate
industry to experience losses for financial and tax reporting purposes
because of the non-cash expenses of depreciation and amortization. As a
result, management expects that this Series, as well as those described
below, will report its equity in Project Partnerships as a loss for tax and
financial reporting purposes. Overall, management believes the Project
Partnerships are operating as expected and are generating tax credits which
meet projections.
At September 30, 2000, the Series had $206,509 of short-term investments
(Cash and Cash Equivalents). It also had $285,216 in Zero Coupon Treasuries
with annual maturities providing $53,836 in fiscal year 2001 increasing to
$66,285 in fiscal year 2007. Management believes the sources of funds are
sufficent to meet current and ongoing operating costs for the foreseeable
future, and to pay part of the Asset Management Fee.
As disclosed on the statement of cash flows, the Series had a net loss of
$140,620 for the six months ended September 30, 2000. However, after
adjusting for Equity in Losses of Project Partnerships of $110,803 and the
changes in operating assets and liabilities, net cash used in operating
activities was $15,701. Net cash provided by investing activities totaled
$33,640, consisting of $5,377 in cash distributions from the Project
Partnerships and $28,263 from matured Zero Coupon Treasuries. There were no
unusual events or trends to describe.
Series 3 - Gateway closed this series on December 13, 1990 after receiving
$5,456,000 from 398 Assignees. Equity in Losses of Project Partnerships for
the six months ended September 30, 2000 decreased from $50,563 for the six
months ended September 30, 1999 to $19,835 as a result of not including
losses of $467,599 in 2000 as compared to $321,049 in 1999, as these losses
would reduce the investment in certain Project Partnerships below zero.
At September 30, 2000, the Series had $170,032 of short-term investments
(Cash and Cash Equivalents). It also had $253,693 in Zero Coupon Treasuries
with annual maturities providing $47,886 in fiscal year 2001 increasing to
$58,940 in fiscal year 2007. Management believes the sources of funds are
sufficient to meet current and ongoing operating costs for the foreseeable
future, and to pay part of the Asset Management Fee.
As disclosed on the statement of cash flows, the Series had a net loss of
$48,574 for the six months ended September 30, 2000. However, after
adjusting for Equity in Losses of Project Partnerships of $19,835 and the
changes in operating assets and liabilities, net cash used in operating
activities was $24,484. Net cash provided by investing activities totaled
$39,029, consisting of $13,890 in cash distributions from the Project
Partnerships and $25,139 from matured Zero Coupon Treasuries. There were no
unusual events or trends to describe.
Series 4 - Gateway closed this series on May 31, 1991 after receiving
$6,915,000 from 465 Assignees. Equity in losses of Project Partnerships for
the six months ended September 30, 1999 were comparable for the six months
ended September 30, 2000.
At September 30, 2000, the Series had $246,710 of short-term investments
(Cash and Cash Equivalents). It also had $321,403 in Zero Coupon Treasuries
with annual maturities providing $60,666 in fiscal year 2001 increasing to
$74,700 in fiscal year 2007. Management believes the sources of funds are
sufficient to meet current and ongoing operating costs for the foreseeable
future, and to pay part of the Asset Management Fee.
As disclosed on the statement of cash flows, the Series had a net loss of
$157,477 for the six months ended September 30, 2000. However, after
adjusting for Equity in Losses of Project Partnerships of $120,592 and the
changes in operating assets and liabilities, net cash used in operating
activities was $22,826. Net cash provided by investing activities totaled
$42,888, consisting of $11,039 in cash distributions from the Project
Partnerships and $31,849 from matured Zero Coupon Treasuries. There were no
unusual events or trends to describe.
Series 5 - Gateway closed this series on October 11, 1991 after receiving
$8,616,000 from 535 Assignees. Gateway's share of net loss prior to
suspended losses for the six months ended September 30, 1999 were comparable
for the six months ended September 30, 2000.
At September 30, 2000, the Series had $330,968 of short-term investments
(Cash and Cash Equivalents). It also had $400,589 in Zero Coupon Treasuries
with annual maturities providing $75,613 in fiscal year 2001 increasing to
$93,075 in fiscal year 2007. Management believes the sources of funds are
sufficient to meet current and ongoing operating costs for the foreseeable
future, and to pay part of the Asset Management Fee.
As disclosed on the statement of cash flows, the Series had a net loss of
$179,174 for the six months ended September 30, 2000. However, after
adjusting for Equity in Losses of Project Partnerships of $135,616 and the
changes in operating assets and liabilities, net cash used in operating
activities was $33,225. Net cash provided by investing activities totaled
$45,486, consisting of $5,790 in cash distributions from the Project
Partnerships and $39,696 from matured Zero Coupon Treasuries. There were no
unusual events or trends to describe.
Series 6 - Gateway closed this series on March 11, 1992 after receiving
$10,105,000 from 625 Assignees. Equity in Losses of Project Partnerships for
the six months ended September 30, 2000 decreased from $337,943 for the six
months ended September 30, 1999 to $281,712 as a result of not including
losses of $286,975 in 2000 as compared to $265,429 in 1999, as these losses
would reduce the investment in certain Project Partnerships below zero.
At September 30, 2000, the Series had $366,558 of short-term investments
(Cash and Cash Equivalents). It also had $386,647 in Zero Coupon Treasuries
with annual maturities providing $58,000 in fiscal year 2001 increasing to
$83,000 in fiscal year 2007. Management believes the sources of funds are
sufficient to meet current and ongoing operating costs for the foreseeable
future, and to pay part of the Asset Management Fee.
As disclosed on the statement of cash flows, the Series had a net loss of
$335,884 for the six months ended September 30, 2000. However, after
adjusting for Equity in Losses of Project Partnerships of $281,712 and the
changes in operating assets and liabilities, net cash used in operating
activities was $63,658. Net cash provided by investing activities totaled
$7,416, consisting of cash distributions from the Project Partnerships.
There were no unusual events or trends to describe.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed by the following persons on behalf of the Registrant
and in the capacities and on the dates indicated.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
By: Raymond James Tax Credit Funds,Inc.
Date: November 14, 2000 By:/s/ Ronald M. Diner
Ronald M. Diner
President
Date: November 14, 2000 By:/s/ Sandra L. Furey
Sandra L. Furey
Secretary and Treasurer
