24
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 June 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 June 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 14, 2000
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 June 30, March 31,
2000 2000
--------- ----------
(Unaudited) (Audited)
ASSETS
Current Assets:
Cash and Cash Equivalents $ 239,062 $ 188,570
Investments in Securities 50,970 51,800
------------ ------------
Total Current Assets 290,032 240,370
Investments in Securities 228,828 274,482
Investments in Project Partnerships, Net 149,362 208,215
------------- -------------
Total Assets $ 668,222 $ 723,067
============= =============
LIABILITIES AND PARTNERS' EQUITY
Current Liabilities:
Payable to General Partners $ 42,138 $ 45,773
------------- -------------
Total Current Liabilities 42,138 45,773
------------- -------------
Long-Term Liabilities:
Payable to General Partners 378,295 361,953
------------- -------------
Partners' Equity (Deficit):
Assignor Limited Partner
Units of limited partnership interest
consisting of 40,000 authorized BAC's, of
which 37,228 at June 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 June 30, 2000
and March 31,2000, issued and outstanding 299,111 365,987
General Partners (51,322) (50,646)
------------- -------------
Total Partners' Equity 247,789 315,341
------------- -------------
Total Liabilities and Partners' Equity $ 668,222 $ 723,067
============= =============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
BALANCE SHEETS
SERIES 3 June 30, March 31,
2000 2000
--------- ----------
(Unaudited) (Audited)
ASSETS
Current Assets:
Cash and Cash Equivalents $ 208,723 $ 155,487
Investments in Securities 45,337 46,075
------------ ------------
Total Current Assets 254,060 201,562
Investments in Securities 203,536 244,145
Investments in Project Partnerships, Net 75,662 100,190
------------- -------------
Total Assets $ 533,258 $ 545,897
============= =============
LIABILITIES AND PARTNERS' EQUITY
Current Liabilities:
Payable to General Partners $ 46,117 $ 49,763
------------- -------------
Total Current Liabilities 46,117 49,763
------------- -------------
Long-Term Liabilities:
Payable to General Partners 284,877 269,872
------------- -------------
Partners' Equity (Deficit):
Assignor Limited Partner
Units of limited partnership interest
consisting of 40,000 authorized BAC's, of
which 37,228 at June 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 June 30, 2000 and
March 31, 2000, issued and outstanding 248,057 271,815
General Partners (45,793) (45,553)
------------- -------------
Total Partners' Equity 202,264 226,262
------------- -------------
Total Liabilities and Partners' Equity $ 533,258 $ 545,897
============= =============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
BALANCE SHEETS
SERIES 4 June 30, March 31,
2000 2000
--------- ----------
(Unaudited) (Audited)
ASSETS
Current Assets:
Cash and Cash Equivalents $ 284,569 $ 226,648
Investments in Securities 57,439 58,372
------------ ------------
Total Current Assets 342,008 285,020
Investments in Securities 257,858 309,308
Investments in Project Partnerships, Net 417,435 487,692
------------- -------------
Total Assets $ 1,017,301 $ 1,082,020
============= =============
LIABILITIES AND PARTNERS' EQUITY
Current Liabilities:
Payable to General Partners $ 50,590 $ 54,952
------------- -------------
Total Current Liabilities 50,590 54,952
------------- -------------
Long-Term Liabilities:
Payable to General Partners 366,519 348,096
------------- -------------
Partners' Equity (Deficit):
Assignor Limited Partner
Units of limited partnership interest
consisting of 40,000 authorized BAC's, of
which 37,228 at June 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 June 30, 2000 and
March 31, 2000, issued and outstanding 654,844 732,836
General Partners (54,652) (53,864)
------------- -------------
Total Partners' Equity 600,192 678,972
------------- -------------
Total Liabilities and Partners' Equity $ 1,017,301 $ 1,082,020
============= =============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
BALANCE SHEETS
SERIES 5 June 30, March 31,
2000 2000
--------- ----------
(Unaudited) (Audited)
ASSETS
Current Assets:
Cash and Cash Equivalents $ 389,719 $ 318,707
Investments in Securities 71,588 72,753
------------ ------------
Total Current Assets 461,307 391,460
Investments in Securities 321,390 385,513
Investments in Project Partnerships, Net 878,426 951,449
------------- -------------
Total Assets $ 1,661,123 $ 1,728,422
============= =============
LIABILITIES AND PARTNERS' EQUITY
Current Liabilities:
Payable to General Partners $ 68,017 $ 73,415
------------- -------------
Total Current Liabilities 68,017 73,415
------------- -------------
Long-Term Liabilities:
Payable to General Partners 368,509 345,734
------------- -------------
Partners' Equity (Deficit):
Assignor Limited Partner
Units of limited partnership interest
consisting of 40,000 authorized BAC's, of
which 37,228 at June 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 June 30, 2000
and March 31,2000, issued and outstanding 1,287,975 1,371,804
General Partners (63,378) (62,531)
------------- -------------
Total Partners' Equity 1,224,597 1,309,273
------------- -------------
Total Liabilities and Partners' Equity $ 1,661,123 $ 1,728,422
============= =============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
BALANCE SHEETS
SERIES 6 June 30, March 31,
2000 2000
--------- ----------
(Unaudited) (Audited)
ASSETS
Current Assets:
Cash and Cash Equivalents $ 421,454 $ 422,800
Investments in Securities 56,021 55,114
------------ ------------
Total Current Assets 477,475 477,914
Investments in Securities 323,795 318,064
Investments in Project Partnerships, Net 1,860,362 1,997,390
------------- -------------
Total Assets $ 2,661,632 $ 2,793,368
============= =============
LIABILITIES AND PARTNERS' EQUITY
Current Liabilities:
Payable to General Partners $ 63,435 $ 69,212
------------- -------------
Total Current Liabilities 63,435 69,212
------------- -------------
Long-Term Liabilities:
Payable to General Partners 464,064 438,798
------------- -------------
Partners' Equity (Deficit):
Assignor Limited Partner
Units of limited partnership interest
consisting of 40,000 authorized BAC's, of
which 37,228 at June 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 June 30, 2000
and March 31,2000, issued and outstanding 2,201,517 2,351,230
General Partners (67,384) (65,872)
------------- -------------
Total Partners' Equity 2,134,133 2,285,358
------------- -------------
Total Liabilities and Partners' Equity $ 2,661,632 $ 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 June 30, March 31,
2000 2000
--------- ----------
(Unaudited) (Audited)
ASSETS
Current Assets:
Cash and Cash Equivalents $ 1,543,527 $ 1,312,212
Investments in Securities 281,355 284,114
------------ ------------
Total Current Assets 1,824,882 1,596,326
Investments in Securities 1,335,407 1,531,512
Investments in Project Partnerships, Net 3,381,247 3,744,936
------------- -------------
Total Assets $ 6,541,536 $ 6,872,774
============= =============
LIABILITIES AND PARTNERS' EQUITY
Current Liabilities:
Payable to General Partners $ 270,297 $ 293,115
------------- -------------
Total Current Liabilities 270,297 293,115
------------- -------------
Long-Term Liabilities:
Payable to General Partners 1,862,264 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 June 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 June 30, 2000 and
March 31, 2000, issued and outstanding 4,691,502 5,093,672
General Partners (282,527) (278,466)
------------- -------------
Total Partners' Equity 4,408,975 4,815,206
------------- -------------
Total Liabilities and Partners' Equity $ 6,541,536 $ 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 JUNE 30,
(Unaudited)
SERIES 2 2000 1999
---- ----
Revenues:
Interest Income $ 8,701 $ 7,982
------------ ------------
Expenses:
Asset Management Fee-General Partner 17,128 17,162
General and Administrative:
General Partner 1,837 1,797
Other 2,212 1,716
Amortization 816 1,212
------------ ------------
Total Expenses 21,993 21,887
------------ ------------
Loss Before Equity in Losses of
Project Partnerships (13,292) (13,905)
Equity in Losses of Project Partnerships (54,260) (45,614)
------------ ------------
Net Loss $ (67,552) $ (59,519)
============ ============
Allocation of Net Loss:
Assignees $ (66,876) $ (58,924)
General Partners (676) (595)
------------ ------------
$ (67,552) $ (59,519)
============ ============
Net Loss Per Beneficial
Assignee Certificate $ (10.90) $ (9.60)
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 JUNE 30,
(Unaudited)
SERIES 3 2000 1999
---- ----
Revenues:
Interest Income $ 7,368 $ 6,994
------------ ------------
Expenses:
Asset Management Fee-General Partner 15,825 15,870
General and Administrative:
General Partner 1,921 1,878
Other 1,860 1,973
Amortization 280 760
------------ ------------
Total Expenses 19,886 20,481
------------ ------------
Loss Before Equity in Losses of
Project Partnerships (12,518) (13,487)
Equity in Losses of Project Partnerships (11,480) (38,464)
------------ ------------
Net Loss $ (23,998) $ (51,951)
============ ============
Allocation of Net Loss:
Assignees $ (23,758) $ (51,431)
General Partners (240) (520)
------------ ------------
$ (23,998) $ (51,951)
============ ============
Net Loss Per Beneficial
Assignee Certificate $ (4.35) $ (9.43)
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 JUNE 30,
(Unaudited)
SERIES 4 2000 1999
---- ----
Revenues:
Interest Income $ 9,724 $ 9,185
------------ ------------
Expenses:
Asset Management Fee-General Partner 19,458 19,497
General and Administrative:
General Partner 2,422 2,368
Other 2,310 2,180
Amortization 1,664 1,932
------------ ------------
Total Expenses 25,854 25,977
------------ ------------
Loss Before Equity in Losses of
Project Partnerships (16,130) (16,792)
Equity in Losses of Project Partnerships (62,650) (78,556)
------------ ------------
Net Loss $ (78,780) $ (95,348)
============ ============
Allocation of Net Loss:
Assignees $ (77,992) $ (94,395)
General Partners (788) (953)
------------ ------------
$ (78,780) $ (95,348)
============ ============
Net Loss Per Beneficial Assignee
Certificate $ (11.28) $ (13.65)
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 JUNE 30,
(Unaudited)
SERIES 5 2000 1999
---- ----
Revenues:
Interest Income $ 12,609 $ 11,791
------------ ------------
Expenses:
Asset Management Fee-General Partner 24,060 24,115
General and Administrative:
General Partner 3,007 2,940
Other 2,985 2,838
Amortization 1,540 1,632
------------ ------------
Total Expenses 31,592 31,525
------------ ------------
Loss Before Equity in Losses of
Project Partnerships (18,983) (19,734)
Equity in Losses of Project Partnerships (65,693) (20,441)
------------ ------------
Net Loss $ (84,676) $ (40,175)
============ ============
Allocation of Net Loss:
Assignees $ (83,829) $ (39,773)
General Partners (847) (402)
------------ ------------
$ (84,676) $ (40,175)
============ ============
Net Loss Per Beneficial Assignee
Certificate $ (9.73) $ (4.62)
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 JUNE 30,
(Unaudited)
SERIES 6 2000 1999
---- ----
Revenues:
Interest Income $ 12,500 $ 11,275
------------ ------------
Expenses:
Asset Management Fee-General Partner 26,622 26,704
General and Administrative:
General Partner 3,174 3,103
Other 2,955 2,901
Amortization 3,745 4,014
------------ ------------
Total Expenses 36,496 36,722
------------ ------------
Loss Before Equity in Losses of
Project Partnerships (23,996) (25,447)
Equity in Losses of Project Partnerships (127,229) (75,582)
------------ ------------
Net Loss $ (151,225) $ (101,029)
============ ============
Allocation of Net Loss:
Assignees $ (149,713) $ (100,019)
General Partners (1,512) (1,010)
------------ ------------
$ (151,225) $ (101,029)
============ ============
Net Loss Per Beneficial Assignee
Certificate $ (14.82) $ (9.90)
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 JUNE 30,
(Unaudited)
TOTAL SERIES 2 - 6 2000 1999
---- ----
Revenues:
Interest Income $ 50,902 $ 47,227
------------ ------------
Expenses:
Asset Management Fee-General Partner 103,093 103,348
General and Administrative:
General Partner 12,361 12,086
Other 12,322 11,608
Amortization 8,045 9,550
------------ ------------
Total Expenses 135,821 136,592
------------ ------------
Loss Before Equity in Losses of
Project Partnerships (84,919) (89,365)
Equity in Losses of Project Partnerships (321,312) (258,657)
------------ ------------
Net Loss $ (406,231) $ (348,022)
============ ============
Allocation of Net Loss:
Assignees $ (402,170) $ (344,543)
General Partners (4,061) (3,479)
------------ ------------
$ (406,231) $ (348,022)
============ ============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF PARTNERS' EQUITY (DEFICIT)
FOR THE THREE MONTHS ENDED JUNE 30, 2000 AND 1999
(Unaudited)
General
SERIES 2 Assignees Partners Total
--------- -------- -----
Balance at March 31, 1999 $ 530,860 $ (48,981) $ 481,879
Net Loss (58,924) (595) (59,519)
------------- ------------ -------------
Balance at June 30, 1999 $ 471,936 $ (49,576) $ 422,360
============= ============ =============
Balance at March 31, 2000 $ 365,987 $ (50,646) $ 315,341
Net Loss (66,876) (676) (67,552)
------------- ------------ -------------
Balance at June 30, 2000 $ 299,111 $ (51,322) $ 247,789
============= ============ =============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF PARTNERS' EQUITY (DEFICIT)
FOR THE THREE MONTHS ENDED JUNE 30, 2000 AND 1999
(Unaudited)
General
SERIES 3 Assignees Partners Total
--------- -------- -----
Balance at March 31, 1999 $ 417,412 $ (44,082) $ 373,330
Net Loss (51,431) (520) (51,951)
------------- ------------ -------------
Balance at June 30, 1999 $ 365,981 $ (44,602) $ 321,379
============= ============ =============
Balance at March 31, 2000 $ 271,815 $ (45,553) $ 226,262
Net Loss (23,758) (240) (23,998)
------------- ------------ -------------
Balance at June 30, 2000 $ 248,057 $ (45,793) $ 202,264
============= ============ =============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF PARTNERS' EQUITY (DEFICIT)
FOR THE THREE MONTHS ENDED JUNE 30, 2000 AND 1999
(Unaudited)
General
SERIES 4 Assignees Partners Total
--------- -------- -----
Balance at March 31, 1999 $ 965,972 $ (51,509) $ 914,463
Net Loss (94,395) (953) (95,348)
------------- ------------ -------------
Balance at June 30, 1999 $ 871,577 $ (52,462) $ 819,115
============= ============ =============
Balance at March 31, 2000 $ 732,836 $ (53,864) $ 678,972
Net Loss (77,992) (788) (78,780)
------------- ------------ -------------
Balance at June 30, 2000 $ 654,844 $ (54,652) $ 600,192
============= ============ =============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF PARTNERS' EQUITY (DEFICIT)
FOR THE THREE MONTHS ENDED JUNE 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 (39,773) (402) (40,175)
------------- ------------ -------------
Balance at June 30, 1999 $ 1,573,573 $ (60,493) $ 1,513,080
============= ============ =============
Balance at March 31, 2000 $ 1,371,804 $ (62,531) $ 1,309,273
Net Loss (83,829) (847) (84,676)
------------- ------------ -------------
Balance at June 30, 2000 $ 1,287,975 $ (63,378) $ 1,224,597
============= ============ =============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF PARTNERS' EQUITY (DEFICIT)
FOR THE THREE MONTHS ENDED JUNE 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 (100,019) (1,010) (101,029)
------------- ------------ -------------
Balance at June 30, 1999 $ 2,777,839 $ (61,563) $ 2,716,276
============= ============ =============
Balance at March 31, 2000 $ 2,351,230 $ (65,872) $ 2,285,358
Net Loss (149,713) (1,512) (151,225)
------------- ------------ -------------
Balance at June 30, 2000 $ 2,201,517 $ (67,384) $ 2,134,133
============= ============ =============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF PARTNERS' EQUITY (DEFICIT)
FOR THE THREE MONTHS ENDED JUNE 30, 2000 AND 1999
(Unaudited)
General
TOTAL SERIES 2 - 6 Assignees Partners Total
--------- -------- -----
Balance at March 31, 1999 $ 5,861,842 $ (270,707) $ 5,591,135
Net Loss (344,543) (3,479) (348,022)
------------- ------------ -------------
Balance at June 30, 1999 $ 5,517,299 $ (274,186) $ 5,243,113
============= ============ =============
Balance at March 31, 2000 $ 5,093,672 $ (278,466) $ 4,815,206
Net Loss (402,170) (4,061) (406,231)
------------- ------------ -------------
Balance at June 30, 2000 $ 4,691,502 $ (282,527) $ 4,408,975
============= ============ =============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED JUNE 30, 2000 AND 1999
(Unaudited)
SERIES 2 2000 1999
-------- ---- ----
Cash Flows from Operating Activities:
Net Loss $ (67,552) $ (59,519)
Adjustments to Reconcile Net Loss to Net
Cash Used in Operating Activities:
Amortization 816 1,212
Accreted Interest Income on Investments
in Securities (5,315) (5,815)
Equity in Losses of Project
Partnerships 54,260 45,614
Interest Income from Redemption of
Securities 23,536 20,241
Changes in Operating Assets and
Liabilities:
Increase in Payable to Other Series 0 170,818
Increase in Payable to General
Partners 12,707 17,154
------------ ------------
Net Cash Used in Operating
Activities 18,452 189,705
------------ ------------
Cash Flows from Investing Activities:
Distributions Received from Project
Partnerships 3,777 2,556
Redemption of Investment in Securities 28,263 29,297
------------ ------------
Net Cash Provided by Investing
Activities 32,040 31,853
------------ ------------
Increase in Cash and Cash Equivalents 50,492 221,558
Cash and Cash Equivalents at Beginning
Of Year 188,570 169,513
------------ ------------
Cash and Cash Equivalents at End of Year $ 239,062 $ 391,071
============ ============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED JUNE 30, 2000 AND 1999
(Unaudited)
SERIES 3 2000 1999
-------- ---- ----
Cash Flows from Operating Activities:
Net Loss $ (23,998) $ (51,951)
Adjustments to Reconcile Net Loss to Net
Cash Provided by (Used in) Operating
Activities:
Amortization 280 760
Accreted Interest Income on Investments
in Securities (4,728) (5,172)
Equity in Losses of Project
Partnerships 11,480 38,464
Interest Income from Redemption of
Securities 20,936 18,004
Changes in Operating Assets and
Liabilities:
Decrease in Payable to Other Series 0 (44,415)
Increase in Payable to General
Partners 11,359 16,175
------------ ------------
Net Cash Provided by (Used in)
Operating Activities 15,329 (28,135)
------------ ------------
Cash Flows from Investing Activities:
Distributions Received from Project
Partnerships 12,768 8,478
Redemption of Investment in Securities 25,139 26,059
------------ ------------
Net Cash Provided by Investing
Activities 37,907 34,537
------------ ------------
Increase in Cash and Cash Equivalents 53,236 6,402
Cash and Cash Equivalents at Beginning of
Year 155,487 137,981
------------ ------------
Cash and Cash Equivalents at End of Year $ 208,723 $ 144,383
============ ============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED JUNE 30, 2000 AND 1999
(Unaudited)
SERIES 4 2000 1999
-------- ---- ----
Cash Flows from Operating Activities:
Net Loss $ (78,780) $ (95,348)
Adjustments to Reconcile Net Loss to Net
Cash Provided by (Used in) Operating
Activities:
Amortization 1,664 1,932
Accreted Interest Income on Investments
in Securities (5,990) (6,553)
Equity in Losses of Project
Partnerships 62,650 78,556
Interest Income from Redemption of
Securities 26,523 22,808
Changes in Operating Assets and
Liabilities:
Decrease in Payable to Other Series 0 (56,270)
Increase in Payable to General
Partners 14,062 19,675
------------ ------------
Net Cash Provided by (Used in)
Operating Activities 20,129 (35,200)
------------ ------------
Cash Flows from Investing Activities:
Distributions Received from Project
Partnerships 5,943 7,621
Redemption of Investment in Securities 31,849 33,015
------------ ------------
Net Cash Provided by Investing
Activities 37,792 40,636
------------ ------------
Increase in Cash and Cash Equivalents 57,921 5,436
Cash and Cash Equivalents at Beginning of
Year 226,648 207,632
------------ ------------
Cash and Cash Equivalents at End of Year $ 284,569 $ 213,068
============ ============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED JUNE 30, 2000 AND 1999
(Unaudited)
SERIES 5 2000 1999
-------- ---- ----
Cash Flows from Operating Activities:
Net Loss $ (84,676) $ (40,175)
Adjustments to Reconcile Net Loss to Net
Cash Provided by (Used in) Operating
Activities:
Amortization 1,540 1,632
Accreted Interest Income on Investments
in Securities (7,466) (8,167)
Equity in Losses of Project
Partnerships 65,693 20,441
Interest Income from Redemption of
Securities 33,057 28,428
Changes in Operating Assets and
Liabilities:
Increase in Payable to Other Series 0 (70,133)
Increase in Payable to General
Partners 17,378 24,470
------------ ------------
Net Cash Provided by (Used in)
Operating Activities 25,526 (43,504)
------------ ------------
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 71,012 6,799
Cash and Cash Equivalents at Beginning of
Year 318,707 292,994
------------ ------------
Cash and Cash Equivalents at End of Year $ 389,719 $ 299,793
============ ============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED JUNE 30, 2000 AND 1999
(Unaudited)
SERIES 6 2000 1999
-------- ---- ----
Cash Flows from Operating Activities:
Net Loss $ (151,225) $ (101,029)
Adjustments to Reconcile Net Loss to Net
Cash Used in Operating Activities:
Amortization 3,745 4,014
Accreted Interest Income on Investments
in Securities (6,638) (7,004)
Equity in Losses of Project
Partnerships 127,229 75,582
Changes in Operating Assets and
Liabilities:
Increase in Payable to General
Partners 19,489 26,828
------------ ------------
Net Cash Used in Operating
Activities (7,400) (1,609)
------------ ------------
Cash Flows from Investing Activities:
Distributions Received from Project
Partnerships 6,054 6,532
Redemption of Investment in Securities 0 0
------------ ------------
Net Cash Provided by Investing
Activities 6,054 6,532
------------ ------------
Increase (Decrease) in Cash and Cash
Equivalents (1,346) 4,923
Cash and Cash Equivalents at Beginning of
Year 422,800 408,672
------------ ------------
Cash and Cash Equivalents at End of Year $ 421,454 $ 413,595
============ ============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED JUNE 30, 2000 AND 1999
(Unaudited)
TOTAL SERIES 2 - 6 2000 1999
-------- ---- ----
Cash Flows from Operating Activities:
Net Loss $ (406,231) $ (348,022)
Adjustments to Reconcile Net Loss to Net
Cash Provided by Operating Activities:
Amortization 8,045 9,550
Accreted Interest Income on Investments
in Securities (30,137) (32,711)
Equity in Losses of Project
Partnerships 321,312 258,657
Interest Income from Redemption of
Securities 104,052 89,481
Changes in Operating Assets and
Liabilities:
Decrease in Accounts Payable 0 (170,818)
Increase in Payable to Other Series 0 170,818
Increase in Payable to General
Partners 74,995 104,302
------------ ------------
Net Cash Provided by Operating
Activities 72,036 81,257
------------ ------------
Cash Flows from Investing Activities:
Distributions Received from Project
Partnerships 34,332 34,342
Redemption of Investment in Securities 124,947 129,519
------------ ------------
Net Cash Provided by Investing
Activities 159,279 163,861
------------ ------------
Increase in Cash and Cash Equivalents 231,315 245,118
Cash and Cash Equivalents at Beginning of
Year 1,312,212 1,216,792
------------ ------------
Cash and Cash Equivalents at End of Year $ 1,543,527 $ 1,461,910
============ ============
See accompanying notes to financial statements.
GATEWAY TAX CREDIT FUND II LTD.
(A Florida Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
JUNE 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 June
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 and 1998 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 June 30, 2000 Balance Sheet includes Investment in Securities
consisting of U.S. Government Security Strips which represents their cost,
plus accreted interest income of $134,426 for Series 2, $119,568 for Series
3, $151,483 for Series 4, $188,804 for Series 5 and $160,370 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 $ 290,788 $ 279,798 $ 10,990
Series 3 258,566 248,873 9,693
Series 4 327,705 315,297 12,408
Series 5 408,318 392,978 15,340
Series 6 392,605 379,816 12,789
As of June 30, 2000, the cost and accreted interest of debt securities by
contractual maturities is as follows:
Series 2 Series 3 Series 4
-------- -------- --------
Due with 1 year $ 50,970 $ 45,337 $ 57,439
After 1 year through 5 years 186,526 165,909 210,191
After 5 years through 10 years 42,302 37,627 47,667
---------- ---------- ----------
Total Amount Carried on
Balance Sheet $ 279,798 $ 248,873 $ 315,297
========== ========== ==========
Series 5 Series 6 Total
-------- -------- --------
Due with 1 year $ 71,588 $ 56,021 $ 281,355
After 1 year through 5 years 261,977 220,080 1,044,683
After 5 years through 10 years 59,413 103,715 290,724
---------- ---------- ----------
Total Amount Carried on
Balance Sheet $ 392,978 $ 379,816 $1,616,762
========== ========== ==========
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 three months June 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 $ 17,128 $ 17,162
Series 3 15,825 15,870
Series 4 19,458 19,497
Series 5 24,060 24,115
Series 6 26,622 26,704
--------- ---------
Total $ 103,093 $ 103,348
========= =========
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 $ 1,837 $ 1,797
Series 3 1,921 1,878
Series 4 2,422 2,368
Series 5 3,007 2,940
Series 6 3,174 3,103
--------- --------
Total $ 12,361 $ 12,086
========= ========
NOTE 5 - INVESTMENTS IN PROJECT PARTNERSHIPS:
As of June 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 JUNE 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) (4,607,486) (4,553,226)
Cumulative distributions received from
Project Partnerships (77,988) (74,211)
------------ -------------
Investment in Project Partnerships before
Adjustment (160,796) (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 (80,680) (79,864)
----------- ------------
Investments in Project Partnerships $ 149,362 $ 208,215
============ ============
(1) In accordance with the Partnership's accounting policy to not carry
Investments in Project Partnerships below zero, cumulative suspended losses
of $1,903,364 for the period ended June 30, 2000 and cumulative suspended
losses of $1,743,287 for the year ended March 31, 2000 are not included.
NOTE 5 - INVESTMENTS IN PROJECT PARTNERSHIPS (continued):
The following is a summary of Investments in Project Partnerships as of:
SERIES 3 JUNE 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) (4,053,781) (4,042,301)
Cumulative distributions received from
Project Partnerships (171,444) (158,676)
----------- -------------
Investment in Project Partnerships before
Adjustment (336,512) (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 (79,572) (79,292)
----------- ------------
Investments in Project Partnerships $ 75,662 $ 100,190
============ ============
(1) In accordance with the Partnership's accounting policy to not carry
Investments in Project Partnerships below zero, cumulative suspended losses
of $2,650,278 for the period ended June 30, 2000 and cumulative suspended
losses of $2,455,000 for the year ended March 31, 2000 are not included.
NOTE 5 - INVESTMENTS IN PROJECT PARTNERSHIPS (continued):
The following is a summary of Investments in Project Partnerships as of:
SERIES 4 JUNE 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) (4,872,659) (4,810,009)
Cumulative distributions received from
Project Partnerships (113,110) (107,167)
----------- -------------
Investment in Project Partnerships before
Adjustment (33,250) 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 (112,282) (110,618)
----------- ------------
Investments in Project Partnerships $ 417,435 $ 487,692
============ ============
(1) In accordance with the Partnership's accounting policy to not carry
Investments in Project Partnerships below zero, cumulative suspended losses
of $1,655,339 for the period ended June 30, 2000 and cumulative suspended
losses of $1,531,158 for the year ended March 31, 2000 are not included.
NOTE 5 - INVESTMENTS IN PROJECT PARTNERSHIPS (continued):
The following is a summary of Investments in Project Partnerships as of:
SERIES 5 JUNE 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) (5,651,232) (5,585,539)
Cumulative distributions received from
Project Partnerships (162,338) (156,548)
----------- -------------
Investment in Project Partnerships before
Adjustment 350,902 422,385
Excess of investment cost over the
underlying assets acquired:
Acquisition fees and expenses 650,837 650,837
Accumulated amortization of acquisition
fees and expenses (123,313) (121,773)
------------ ------------
Investments in Project Partnerships $ 878,426 $ 951,449
============ ============
(1) In accordance with the Partnership's accounting policy to not carry
Investments in Project Partnerships below zero, cumulative suspended losses
of $1,836,922 for the period ended June 30, 2000 and cumulative suspended
losses of $1,642,901 for the year ended March 31, 2000 are not included.
NOTE 5 - INVESTMENTS IN PROJECT PARTNERSHIPS (continued):
The following is a summary of Investments in Project Partnerships as of:
SERIES 6 JUNE 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) (6,057,050) (5,929,821)
Cumulative distributions received from
Project Partnerships (169,827) (163,773)
------------ -------------
Investment in Project Partnerships before
Adjustment 1,235,338 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 (160,155) (156,410)
------------ ------------
Investments in Project Partnerships $ 1,860,362 $ 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 $1,172,724 for the period ended June 30, 2000 and cumulative suspended
losses of $1,029,135 for the year ended March 31, 2000 are not included.
NOTE 5 - INVESTMENTS IN PROJECT PARTNERSHIPS (continued):
The following is a summary of Investments in Project Partnerships as of:
TOTAL SERIES 2 - 6 JUNE 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) (25,242,208) (24,920,896)
Cumulative distributions received from
Project Partnerships (694,707) (660,375)
----------- -------------
Investment in Project Partnerships before
Adjustment 1,055,682 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 (556,002) (547,957)
----------- ------------
Investments in Project Partnerships $ 3,381,247 $ 3,744,936
============ ============
NOTE 5 - INVESTMENTS IN PROJECT PARTNERSHIPS (continued):
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
March 31, of each year:
MARCH 31,
2000 1999
SERIES 2 ---- ----
SUMMARIZED BALANCE SHEETS
Assets:
Current assets $ 1,926,243 $ 1,763,428
Investment properties, net 19,665,009 20,551,425
Other assets 1,345 15,740
----------- -----------
Total assets $21,592,597 $22,330,593
=========== ===========
Liabilities and Partners' Equity:
Current liabilities $ 532,966 $ 501,446
Long-term debt 23,105,111 23,165,507
----------- -----------
Total liabilities 23,638,077 23,666,953
----------- -----------
Partners' equity
Limited Partner (2,048,150) (1,361,567)
General Partners 2,670 25,207
----------- -----------
Total Partners' equity (2,045,480) (1,336,360)
----------- -----------
Total liabilities and partners'
equity $21,592,597 $22,330,593
=========== ===========
SUMMARIZED STATEMENTS OF OPERATIONS
Rental and other income $ 691,499 $ 704,648
Expenses: ----------- -----------
Operating expenses 465,534 495,055
Interest expense 218,164 239,187
Depreciation and amortization 224,303 229,460
----------- -----------
Total expenses 908,001 963,702
----------- -----------
Net loss $ (216,502) $ (259,054)
=========== ===========
Other partners' share of net loss $ (2,165) $ (2,591)
=========== ===========
Partnerships' share of net loss $ (214,337) $ (256,463)
Suspended losses 160,077 210,849
----------- -----------
Equity in Losses of Project Partnerships $ (54,260) $ (45,614)
=========== ===========
NOTE 5 - INVESTMENTS IN PROJECT PARTNERSHIPS (continued):
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
March 31, of each year:
MARCH 31,
2000 1999
SERIES 3 ---- ----
SUMMARIZED BALANCE SHEETS
Assets:
Current assets $ 2,182,523 $ 2,198,970
Investment properties, net 16,695,060 17,834,880
Other assets 207,508 216,095
----------- -----------
Total assets $19,085,091 $20,249,945
=========== ===========
Liabilities and Partners' Equity:
Current liabilities $ 505,229 $ 499,172
Long-term debt 21,638,076 21,712,606
----------- -----------
Total liabilities 22,143,305 22,211,778
----------- -----------
Partners' equity
Limited Partner (3,274,906) (2,222,181)
General Partners 216,692 260,348
----------- -----------
Total Partners' equity (3,058,214) (1,961,833)
----------- -----------
Total liabilities and partners'
equity $19,085,091 $20,249,945
=========== ===========
SUMMARIZED STATEMENTS OF OPERATIONS
Rental and other income $ 628,629 $ 608,864
Expenses: ----------- -----------
Operating expenses 446,146 369,595
Interest expense 160,547 181,793
Depreciation and amortization 231,772 229,140
----------- -----------
Total expenses 838,465 780,528
----------- -----------
Net loss $ (209,836) $ (171,664)
=========== ===========
Other partners' share of net loss $ (3,078) $ (1,717)
=========== ===========
Partnerships' share of net loss $ (206,758) $ (169,947)
Suspended losses 195,278 131,483
----------- -----------
Equity in Losses of Project Partnerships $ (11,480) $ (38,464)
=========== ===========
NOTE 5 - INVESTMENTS IN PROJECT PARTNERSHIPS (continued):
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
March 31, of each year:
MARCH 31,
2000 1999
SERIES 4 ---- ----
SUMMARIZED BALANCE SHEETS
Assets:
Current assets $ 2,451,965 $ 2,331,677
Investment properties, net 23,088,334 24,043,020
Other assets 12,338 21,916
----------- -----------
Total assets $25,552,637 $26,396,613
=========== ===========
Liabilities and Partners' Equity:
Current liabilities $ 705,966 $ 682,879
Long-term debt 26,383,242 26,489,140
----------- -----------
Total liabilities 27,089,208 27,172,019
----------- -----------
Partners' equity
Limited Partner (1,670,319) (967,012)
General Partners 133,748 191,606
----------- -----------
Total Partners' equity (1,536,571) (775,406)
----------- -----------
Total liabilities and partners'
equity $25,552,637 $26,396,613
=========== ===========
SUMMARIZED STATEMENTS OF OPERATIONS
Rental and other income $ 821,323 $ 806,616
Expenses: ----------- -----------
Operating expenses 536,175 429,834
Interest expense 228,937 332,606
Depreciation and amortization 245,725 253,810
----------- -----------
Total expenses 1,010,837 1,016,250
----------- -----------
Net loss $ (189,514) $ (209,634)
=========== ===========
Other partners' share of net loss $ (2,683) $ (2,096)
=========== ===========
Partnerships' share of net loss $ (186,831) $ (207,538)
Suspended losses 124,181 128,982
----------- -----------
Equity in Losses of Project Partnerships $ (62,650) $ (78,556)
=========== ===========
NOTE 5 - INVESTMENTS IN PROJECT PARTNERSHIPS (continued):
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
March 31, of each year:
MARCH 31,,
2000 1999
SERIES 5 ---- ----
SUMMARIZED BALANCE SHEETS
Assets:
Current assets $ 2,988,236 $ 2,846,257
Investment properties, net 28,914,417 30,120,120
Other assets 8,581 7,499
----------- -----------
Total assets $31,911,234 $32,973,876
=========== ===========
Liabilities and Partners' Equity:
Current liabilities $ 757,940 $ 818,028
Long-term debt 32,652,940 32,737,670
----------- -----------
Total liabilities 33,410,880 33,555,698
----------- -----------
Partners' equity
Limited Partner (1,396,026) (472,278)
General Partners (103,620) (109,544)
----------- -----------
Total Partners' equity (1,499,646) (581,822)
----------- -----------
Total liabilities and partners'
equity $31,911,234 $32,973,876
=========== ===========
SUMMARIZED STATEMENTS OF OPERATIONS
Rental and other income $ 931,151 $ 901,356
Expenses: ----------- -----------
Operating expenses 662,688 612,614
Interest expense 209,217 218,343
Depreciation and amortization 321,584 328,285
----------- -----------
Total expenses 1,193,489 1,159,242
----------- -----------
Net loss $ (262,338) $ (257,886)
=========== ===========
Other partners' share of net loss $ (2,624) $ (2,579)
=========== ===========
Partnerships' share of net loss $ (259,714) $ (255,307)
Suspended losses 194,021 234,866
----------- -----------
Equity in Losses of Project Partnerships $ (65,693) $ (20,441)
=========== ===========
NOTE 5 - INVESTMENTS IN PROJECT PARTNERSHIPS (continued):
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
March 31, of each year:
MARCH 31,
2000 1999
SERIES 6 ---- ----
SUMMARIZED BALANCE SHEETS
Assets:
Current assets $ 3,151,260 $ 3,160,853
Investment properties, net 32,850,632 34,052,870
Other assets 6,887 31,775
----------- -----------
Total assets $36,008,779 $37,245,498
=========== ===========
Liabilities and Partners' Equity:
Current liabilities $ 712,394 $ 791,217
Long-term debt 35,470,856 35,588,981
----------- -----------
Total liabilities 36,183,250 36,380,198
----------- -----------
Partners' equity
Limited Partner 83,574 1,071,248
General Partners (258,045) (205,948)
----------- -----------
Total Partners' equity (174,471) 865,300
----------- -----------
Total liabilities and partners'
equity $36,008,779 $37,245,498
=========== ===========
SUMMARIZED STATEMENTS OF OPERATIONS
Rental and other income $ 1,007,346 $ 1,011,534
Expenses: ----------- -----------
Operating expenses 651,321 588,704
Interest expense 287,330 247,932
Depreciation and amortization 342,958 353,728
----------- -----------
Total expenses 1,281,609 1,190,364
----------- -----------
Net loss $ (274,263) $ (178,830)
=========== ===========
Other partners' share of net loss $ (3,445) $ (1,788)
=========== ===========
Partnerships' share of net loss $ (270,818) $ (177,042)
Suspended losses 143,589 101,460
----------- -----------
Equity in Losses of Project Partnerships $ (127,229) $ (75,582)
=========== ===========
NOTE 5 - INVESTMENTS IN PROJECT PARTNERSHIPS (continued):
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
March 31, of each year:
MARCH 31,
2000 1999
TOTAL SERIES 2- 6 ---- ----
SUMMARIZED BALANCE SHEETS
Assets:
Current assets $ 12,700,227 $ 12,301,185
Investment properties, net 121,213,452 126,602,315
Other assets 236,659 293,025
----------- -----------
Total assets $134,150,338 $139,196,525
=========== ===========
Liabilities and Partners' Equity:
Current liabilities $ 3,214,495 $ 3,292,742
Long-term debt 139,250,225 139,693,904
----------- -----------
Total liabilities 142,464,720 142,986,646
----------- -----------
Partners' equity
Limited Partner (8,305,827) (3,951,790)
General Partners (8,555) 161,669
----------- -----------
Total Partners' equity (8,314,382) (3,790,121)
----------- -----------
Total liabilities and partners'
equity $134,150,338 $139,196,525
=========== ===========
SUMMARIZED STATEMENTS OF OPERATIONS
Rental and other income $ 4,079,948 $ 4,033,018
Expenses: ----------- -----------
Operating expenses 2,761,864 2,495,802
Interest expense 1,104,195 1,219,861
Depreciation and amortization 1,366,342 1,394,423
----------- -----------
Total expenses 5,232,401 5,110,086
----------- -----------
Net loss $(1,152,453) $(1,077,068)
=========== ===========
Other partners' share of net loss $ (13,995) $ (10,771)
=========== ===========
Partnerships' share of net loss $(1,138,458) $(1,066,297)
Suspended losses 817,146 807,640
----------- -----------
Equity in Losses of Project
Partnerships $ (321,312) $ (258,657)
=========== ===========
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 three months ended
June 30, 2000 and June 30, 1999. The General and Administrative expenses -
General Partner and General and Administrative expenses - Other for the three
months ended June 30, 2000 are comparable for the same period ended June 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 three months ended June 30, 1999 were comparable for the three months
ended June 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 June 30, 2000, the Series had $239,062 of short-term investments (Cash
and Cash Equivalents). It also had $279,798 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 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
$67,552 for the three months ended June 30, 2000. However, after adjusting
for Equity in Losses of Project Partnerships of $54,260 and the changes in
operating assets and liabilities, net cash provided by activities was $8,452,
primarily due to the interest income from the maturity of the Zero Coupon
Treasuries. Cash provided by investing activities totaled $32,040,
consisting of $3,777 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 three months ended June 30, 2000 decreased from $38,464 for the three
months ended June 30, 1999 to $11,480 as a result of not including losses of
$195,278, as these losses would reduce the investment in certain Project
Partnerships below zero.
At June 30, 1999, the Series had $208,723 of short-term investments (Cash and
Cash Equivalents). It also had $248,873 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
$23,998 for the three months ended June 30, 2000. However, after adjusting
for Equity in Losses of Project Partnerships of $11,480 and the changes in
operating assets and liabilities, net cash provided by operating activities
was $15,329, primarily due to the Interest Income from the Redemption of Zero
Coupon Treasuries of $20,936. Cash provided by investing activities totaled
$37,907, consisting of $12,768 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 three months ended June 30, 1999 were comparable for the three months
ended June 30, 2000.
At June 30, 2000, the Series had $284,569 of short-term investments (Cash
and Cash Equivalents). It also had $315,297 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
$78,780 for the three months ended June 30, 2000. However, after adjusting
for Equity in Losses of Project Partnerships of $62,650 and the changes in
operating assets and liabilities, net cash provided by operating activities
was $20,129, primarily due to the Interest Income from the Redemption of Zero
Coupon Treasuries of $26,523. Cash provided by investing activities totaled
$37,792, consisting of $5,943 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 three months ended June 30, 1999 were comparable for
the three months ended June 30, 2000.
At June 30, 2000, the Series had $389,719 of short-term investments (Cash
and Cash Equivalents). It also had $392,978 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
$84,676 for the three months ended June 30, 2000. However, after adjusting
for Equity in Losses of Project Partnerships of $65,693 and the changes in
operating assets and liabilities, net cash provided by operating activities
was $25,526, primarily due to the Interest Income from the Redemption of Zero
Coupon Treasuries of $33,057. 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 three months ended June 30, 2000 increased from $75,582 for the three
months ended June 30, 1999 to $127,229 as a result of not including losses of
$143,589 in 2000 as compared to $101,460 in 1999, as these losses would
reduce the investment in certain Project Partnerships below zero.
At June 30, 2000, the Series had $421,454 of short-term investments (Cash
and Cash Equivalents). It also had $379,816 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
$151,225 for the three months ended June 30, 2000. However, after adjusting
for Equity in Losses of Project Partnerships of $127,229 and the changes in
operating assets and liabilities, net cash used in operating activities was
$7,400, primarily due to the increase in payable to the General Partners.
Cash provided by investing activities totaled $6,054, 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: August 16, 2000 By:/s/ Ronald M. Diner
Ronald M. Diner
President
Date: August 16, 2000 By:/s/ Sandra L. Furey
Sandra L. Furey
Secretary and Treasurer
