Other Assets

The Company had the following Other Assets as of dates shown:



	December 31, 2011			December 31, 2010
Property loans receivable	$	19,808,803		$	16,465,960
Less: Loan loss reserves	(16,782,918		)	(9,899,749		)
Deferred financing costs - net	4,035,964			4,040,735
Fair value of derivative contracts	1,323,270			3,406,791
Taxable bonds at fair market value	774,946			204,449
Other assets	1,213,581			2,340,014
Total Other Assets	$	10,373,646		$	16,558,200

In addition to the tax-exempt mortgage revenue bonds held by the Company, taxable mortgage loans have been made to the owners of the properties which secure certain of the tax-exempt mortgage revenue bonds and are reported as Other Assets, net of allowance. The Company periodically, or as changes in circumstances or operations dictate, evaluates such taxable loans for impairment. The value of the underlying property assets is ultimately the most relevant measure of the value to support the taxable loan values. The Company utilizes a discounted cash flow model in estimating a property fair value. A number of different discounted cash flow models containing varying assumptions are considered. The various models may assume multiple revenue and expense scenarios, various capitalization rates and multiple discount rates. In estimating the property valuation, the most significant assumptions utilized in the discounted cash flow model were the same as those discussed in Note 2 above except that the specific discount rate used to estimate the property valuation in the current year models was 6.5%. The Company believes this represents a rate at which a multifamily property could obtain current tax-exempt financing similar to the current existing outstanding bonds. Other information, such as independent appraisals, may be considered in estimating a property fair value. If the estimated fair value of the property after deducting the amortized cost basis of any senior tax-exempt mortgage revenue bond exceeds the principle balance of the property loan then no potential loss is indicated and no allowance for loan loss is needed.

The following is a summary of the taxable loans, accrued interest and allowance on amount due at December 31, 2011 and 2010:



	December 31, 2011
	Outstanding Balance		Accrued Interest		Loan Loss Reserves			Net Taxable Loans
Ashley Square	$	4,786,342	$	1,331,186	$	(4,927,528	)	$	1,190,000
Cross Creek	6,769,227		1,360,270		(4,564,742		)	3,564,755
Iona Lakes	7,339,118		2,207,301		(6,208,923		)	3,337,496
Woodland Park	914,116		167,609		(1,081,725		)	—
	$	19,808,803	$	5,066,366	$	(16,782,918	)	$	8,092,251

	December 31, 2010
	Outstanding Balance		Accrued Interest		Allowance			Net Taxable Loans
Ashley Square	$	4,786,342	$	1,018,634	$	(4,614,976	)	$	1,190,000
Cross Creek	6,388,227		1,119,201		(4,323,674		)	3,183,754
Foundation for Affordable Housing	4,377,275		397,110		—			4,774,385
Woodland Park	914,116		46,983		(961,099		)	—
	$	16,465,960	$	2,581,928	$	(9,899,749	)	$	9,148,139

In September 2011, the Foundation for Affordable Housing sold its ownership interest in the property securing the taxable loan with the Company and used the sales proceeds to repay approximately $4.5 million principal and interest.

During 2011, the Partnership advanced additional funds to Cross Creek and Iona Lakes of approximately $381,000 and $618,000, respectively. The Partnership believes that these properties will be self-sufficient from an operating cash flow perspective over the term of the bond but will continue to provide property loan advances to cover their short-term working capital needs.

As discussed in Note 4, the Partnership deconsolidated the VIE that owns the Iona Lakes property during 2011. During 2010, the Partnership deconsolidated the VIEs that own the Ashley Square and Cross Creek properties. As a result of these VIEs being deconsolidated, the taxable loan and the corresponding loan loss was recognized in the Partnership financial statements. The 2011 taxable loans impairment evaluations resulted in the Partnership recording a $4.2 million loan loss reserve against the Iona Lakes taxable loan. In 2010, the impairment analysis resulted in an additional $562,385 provision for loan loss against the Ashely Square and Cross Creek taxable loans and the $700,000 provision for loan loss in 2009 was recorded against the Woodland Park taxable loan.

The following is a detail of loan loss reserves for the years ended December 31:



	2011		2010		2009
Balance, beginning of year	$	9,899,719	$	735,719	$	—
Provision for loan loss	4,242,571		562,385		701,731
Deconsolidation of VIEs	1,861,051		7,589,901		—
Accrued interest not recognized	779,577		1,011,744		33,988
Balance, end of year	$	16,782,918	$	9,899,749	$	735,719

Accrued interest not recognized represents interest accrued that the Partnership has determined they are not reasonably assured of collecting. During 2011, the Partnership recorded an allowance for accrued interest not recognized on Ashley Square, Cross Creek, Iona Lakes, and Woodland Park taxable loans. Amounts reflected in 2010 relate to accrued interest not recognized on the Woodland Park, Ashley Square, and Cross Creek taxable loans.

The Company, at December 31, 2011 and 2010, holds an asset held for sale valued at an appraised value of $375,000, along with a receivable of approximately $711,000 representing amounts due from a project owner of Prairebrook Village. In 2008 the Company foreclosed on the Prairebrook Village bond and obtained a summary judgment against ownership. The Partnership placed liens on assets identified and garnished wages from the judgment parties. In 2009, the Company recorded a $700,000 provision for loan loss reserve against this judgment receivable. In February 2010, the Company was informed that bankruptcy protection may be sought by the judgment party. This reserve is $711,000 and $700,000 at December 31, 2011 and 2010 while the Company continues to pursue this receivable.