UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark one)

  x   QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2007.

OR

o   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                               to                               .

Commission file no. 0-16191

DEL TACO RESTAURANT PROPERTIES I

a California limited partnership

(Exact name of registrant as specified in its charter)

California	95-3852699
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification Number)
25521 Commercentre Drive, Lake Forest, California	92630
(Address of principal executive offices)	(Zip Code)

(949) 462-9300

(Registrant’s telephone number, including area code)

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 þ  No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act (check one):

Large accelerated filer o     Accelerated filer o     Non-accelerated filer þ

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  Yes o  No þ

INDEX

DEL TACO RESTAURANT PROPERTIES I

	PAGE NUMBER
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements	3
Condensed Balance Sheets at September 30, 2007 (Unaudited) and December 31, 2006	3
Condensed Statements of Income for the three and nine months ended September 30, 2007 and 2006 (Unaudited)	4
Condensed Statements of Cash Flows for the nine months ended September 30, 2007 and 2006 (Unaudited)	5
Notes to Condensed Financial Statements (Unaudited)	6
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	9
Item 3. Quantitative and Qualitative Disclosures About Market Risk	11
Item 4. Controls and Procedures	11
PART II. OTHER INFORMATION
Item 1. Legal Proceedings	12
Item 6. Exhibits and Reports	12
SIGNATURE	13
EXHIBIT 31.1
EXHIBIT 31.2
EXHIBIT 32.1

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PART I. FINANCIAL INFORMATION

ITEM I. FINANCIAL STATEMENTS

DEL TACO RESTAURANT PROPERTIES I

CONDENSED BALANCE SHEETS

	September 30,		December 31,
	2007		2006
	(Unaudited)
ASSETS
CURRENT ASSETS:
Cash	$	232,956	$	259,468
Receivable from Del Taco LLC		61,442		61,641
Deposits		986		1,130
Total current assets		295,384		322,239
PROPERTY AND EQUIPMENT:
Land and improvements		1,852,482		1,852,482
Buildings and improvements		1,013,134		1,013,134
Machinery and equipment		1,136,026		1,136,026
		4,001,642		4,001,642
Less—accumulated depreciation		2,069,798		2,048,087
		1,931,844		1,953,555
	$	2,227,228	$	2,275,794
LIABILITIES AND PARTNERS’ EQUITY
CURRENT LIABILITIES:
Payable to limited partners	$	42,461	$	81,877
Accounts payable		10,023		9,421
Total current liabilities		52,484		91,298
PARTNERS’ EQUITY:
Limited partners; 8,751 units outstanding at September 30, 2007 and December 31, 2006		1,912,900		1,922,554
General partner-Del Taco LLC		261,844		261,942
		2,174,744		2,184,496
	$	2,227,228	$	2,275,794

See accompanying notes to condensed financial statements.

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DEL TACO RESTAURANT PROPERTIES I

CONDENSED STATEMENTS OF INCOME

(Unaudited)

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2007		2006		2007		2006
RENTAL REVENUES	$	188,813	$	180,681	$	543,869	$	543,322
EXPENSES:
General and administrative		10,682		9,137		64,124		60,176
Depreciation		7,237		7,237		21,711		21,711
		17,919		16,374		85,835		81,887
Operating income		170,894		164,307		458,034		461,435
OTHER INCOME:
Interest		986		1,347		3,395		3,444
Other		250		300		1,500		650
Net income	$	172,130	$	165,954	$	462,929	$	465,529
Net income per limited partnership unit (note 2)	$	19.47	$	18.77	$	52.37	$	52.67
Number of units used in computing per unit amounts		8,751		8,751		8,751		8,751

See accompanying notes to condensed financial statements.

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DEL TACO RESTAURANT PROPERTIES I

CONDENSED STATEMENTS OF CASH FLOWS

(Unaudited)

	Nine Months Ended
	September 30,
	2007			2006
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	462,929		$	465,529
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation		21,711			21,711
Changes in operating assets and liabilities:
Receivable from Del Taco LLC		199			5,813
Deposits		144			(674	)
Payable to limited partners		(39,416	)		(4,310	)
Accounts payable		602			(94	)
Net cash provided by operating activities		446,169			487,975
CASH FLOWS FROM FINANCING ACTIVITIES:
Cash distributions to partners		(472,681	)		(502,379	)
Net decrease in cash		(26,512	)		(14,404	)
Beginning cash balance		259,468			268,272
Ending cash balance	$	232,956		$	253,868

See accompanying notes to condensed financial statements.

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DEL TACO RESTAURANT PROPERTIES I

NOTES TO CONDENSED FINANCIAL STATEMENTS

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2007

UNAUDITED

NOTE 1 — BASIS OF PRESENTATION

The accompanying unaudited condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements and should therefore be read in conjunction with the financial statements and notes thereto contained in the annual report on Form 10-K for the year ended December 31, 2006 for Del Taco Restaurant Properties I (the Partnership or the Company). Amounts related to disclosure of December 31, 2006 balances within these interim financial statements were derived from the audited 2006 financial statements and notes thereto included in the 2006 Form 10-K. In the opinion of management, all adjustments (consisting of normal recurring adjustments) necessary to present fairly the Partnership’s financial position at September 30, 2007, the results of operations for the three and nine month periods ended September 30, 2007 and 2006 and cash flows for the nine month periods ended September 30, 2007 and 2006 have been included. Operating results for the three and nine months ended September 30, 2007 are not necessarily indicative of the results that may be expected for the year ending December 31, 2007.

NOTE 2 — NET INCOME PER LIMITED PARTNERSHIP UNIT

Net income per limited partnership unit is based on net income attributable to the limited partners (after 1% allocation to the general partner) using the weighted average number of units outstanding during the periods presented, which amounted to 8,751 units in 2007 and 2006.

Pursuant to the partnership agreement, annual partnership net income is allocated one percent to Del Taco LLC, formerly known as Del Taco, Inc., (Del Taco or the General Partner), and 99 percent to the limited partners. A partnership net loss in any year will be allocated 24 percent to the General Partner and 76 percent to the limited partners until the losses so allocated equal income previously allocated. Any additional losses will be allocated one percent to the General Partner and 99 percent to the limited partners. Partnership gains from any sale or refinancing will be allocated one percent to the General Partner and 99 percent to the limited partners until allocated gains and profits equal losses. Additional gains will be allocated 24 percent to the General Partner and 76 percent to the limited partners.

NOTE 3 — LEASING ACTIVITIES

The Partnership leases certain properties for operation of restaurants to Del Taco on a triple net basis. The leases are for terms of 35 years commencing with the completion of the restaurant facility located on each property and require monthly rentals equal to 12 percent of the gross sales of the restaurants. The leases expire in the years 2019 to 2020. There is no minimum rental payments required under any of the leases.

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DEL TACO RESTAURANT PROPERTIES I

NOTES TO CONDENSED FINANCIAL STATEMENTS — CONTINUED

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2007

UNAUDITED

NOTE 3 — LEASING ACTIVITIES — continued

For the three months ended September 30, 2007, the five restaurants operated by Del Taco, for which the Partnership is the lessor, had combined, unaudited sales of $1,315,056 and unaudited net income of $3,767 as compared to $1,254,188 and $12,406, respectively, for the corresponding period in 2006. Net income or loss of each restaurant includes charges for general and administrative expenses incurred in connection with supervision of restaurant operations and interest expense. For the three months ended September 30, 2007, the one restaurant operated by a Del Taco franchisee, for which the Partnership is the lessor, had unaudited sales of $258,388 as compared with $251,487 during the same period in 2006.

For the nine months ended September 30, 2007, the five restaurants operated by Del Taco, for which the Partnership is the lessor, had combined, unaudited sales of $3,775,425 and unaudited net income of $7,778 as compared to $3,774,789 and $121,512, respectively, for the corresponding period in 2006. Net income or loss of each restaurant includes charges for general and administrative expenses incurred in connection with supervision of restaurant operations and interest expense and the decrease in net income from the corresponding period of the prior year primarily relates to additional interest expense from the debt that was issued in connection with the acquisition of Del Taco (see Note 8). For the nine months ended September 30, 2007, the one restaurant operated by a Del Taco franchisee, for which the Partnership is the lessor, had unaudited sales of $756,813 as compared with $752,892 during the same period in 2006.

NOTE 4 — TRANSACTIONS WITH DEL TACO

The receivable from Del Taco consists primarily of rent accrued for the month of September 2007. The September rent receivable was collected in October 2007.

Del Taco serves in the capacity of general partner in other partnerships which are engaged in the business of operating restaurants, and three other partnerships which were formed for the purpose of acquiring real property in California for construction of Mexican-American restaurants for lease under long-term agreements to Del Taco for operation under the Del Taco trade name.

In addition, see Note 5 with respect to certain distributions to the General Partner.

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DEL TACO RESTAURANT PROPERTIES I

NOTES TO CONDENSED FINANCIAL STATEMENTS — CONTINUED

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2007

UNAUDITED

NOTE 5 — DISTRIBUTIONS

Total cash distributions declared and paid in January, April, and July 2007 were $172,599, $153,730 and $146,352 respectively. On October 29, 2007, a distribution to the limited partners of $183,640, or approximately $20.99 per limited partnership unit, was approved. Such distribution was paid on October 31, 2007. The General Partner also received a distribution of $1,855 with respect to its 1% partnership interest.

NOTE 6 — PAYABLE TO LIMITED PARTNERS

Payable to limited partners represents a reclassification from cash for distribution checks made to limited partners that have remained outstanding for 6 months or longer. The reduction in payable to limited partners from December 31, 2006 to September 30, 2007 is primarily due to reissuing outstanding distribution checks to limited partners who were located in connection with the Partnership’s review of unclaimed property.

NOTE 7 — CONCENTRATION OF RISK

The six restaurants leased to Del Taco make up all of the income producing assets of the Partnership and contributed all of the Partnership’s rental revenues during the three and nine months ended September 30, 2007 and 2006.  Therefore, the business of the Partnership is entirely dependent on the success of the Del Taco trade name restaurants that lease the properties. 

NOTE 8 — ACQUISITION OF GENERAL PARTNER

On January 30, 2006, the parent company of the General Partner entered into an agreement to sell all of its issued and outstanding common stock to Sagittarius Acquisitions II, Inc. The transaction was consummated on March 29, 2006 and did not have an impact on the financial position, results of operations or cash flows of the Partnership.

NOTE 9 — COMMENTS AND CONTINGENIES

Litigation

The General Partner of the Partnership is a defendant in a lawsuit related to a property line dispute for the restaurant on Baseline & Archibald in Rancho Cucamonga, California. The Partnership has an express easement covering the alleged encroachment and believes a blanket development easement covers the remainder of the alleged encroachment. The General Partner intends to defend against this lawsuit, although resolution of this matter could involve the Partnership acquiring the encroached territory.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Liquidity and Capital Resources

Del Taco Restaurant Properties I (the Partnership or the Company) offered limited partnership units for sale between March 1983 and March 1984. $4.375 million was raised through the sale of limited partnership units and used to acquire sites and build six restaurants and also to pay commissions to brokers and to reimburse Del Taco LLC (the General Partner or Del Taco) for offering costs incurred.

The six restaurants leased to Del Taco make up all of the income producing assets of the Partnership. Therefore, the business of the Partnership is entirely dependent on the success of the Del Taco trade name restaurants that lease the properties. The success of the restaurants is dependent on a large variety of factors, including, but not limited to, competition, consumer demand and preference for fast food, in general, and for Mexican-American food in particular.

Results of Operations

The Partnership owns six properties that are under long-term lease to Del Taco for restaurant operations (Del Taco, in turn, has subleased one of the restaurants to a Del Taco franchisee).

The following table sets forth rental revenue earned by restaurant for the three and nine months ended September 30, 2007 and 2006 (unaudited):

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2007		2006		2007		2006
Riverside Avenue, Rialto, CA	$	29,604	$	30,324	$	86,944	$	86,889
Elden Avenue, Moreno Valley, CA		27,120		29,279		79,051		93,676
Foothill Boulevard, La Verne, CA		44,979		43,856		130,225		129,950
Baseline & Archibald, Rancho Cucamonga, CA		31,007		30,179		90,818		90,347
Elkhorn Boulevard, Sacramento, CA		20,871		17,632		59,317		53,633
Haven Avenue, Rancho Cucamonga, CA		35,232		29,411		97,514		88,827
Total	$	188,813	$	180,681	$	543,869	$	543,322

The Partnership receives rental revenues equal to 12 percent of gross sales from the restaurants. The Partnership earned rental revenue of $188,813 during the three month period ended September 30, 2007, which represents an increase of $8,132 from the corresponding period in 2006. The Partnership earned rental revenue of $543,869 during the nine month period ended September 30, 2007, which represents an increase of $547 from the corresponding period in 2006. The changes in rental revenues between 2007 and 2006 are directly attributable to changes in sales levels at the restaurants under lease due to local competitive and industry factors.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations — continued

The following table breaks down general and administrative expenses by type of expense:

	Percent of Total
	General & Administrative Expense
	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2007			2006			2007			2006
Accounting fees		53.60	%		57.05	%		69.72	%		70.48	%
Distribution of information to limited partners		46.40	%		42.95	%		30.28	%		29.52	%
		100.00	%		100.00	%		100.00	%		100.00	%

General and administrative costs for the three month and nine month periods ended September 30, 2007 increased from the corresponding periods in 2006 due to increased costs for accounting fees related to certain statutory filing requirements and increased printing costs.

For the three month period ended September 30, 2007, net income increased $6,176 from 2007 to 2006 due to the increase in revenues of $8,132, which was partially offset by the decrease in interest and other income of $411, and the $1,545 increase in general and administrative expenses. For the nine month period ended September 30, 2007, net income decreased by $2,600 from 2007 to 2006 due to the increase in general and administrative expenses of $3,948, which was partially offset by increases in revenues of $547 and interest and other income of $801.

Significant Recent Accounting Pronouncements

None.

Off-Balance Sheet Arrangements

None.

Critical Accounting Policies and Estimates

Management’s discussion and analysis of financial condition and results of operations, as well as disclosures included elsewhere in this report on Form 10-Q are based upon the Partnership’s financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these financial statements requires management to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses. The Partnership believes the critical accounting policies that most impact the financial statements are described below. A summary of the significant accounting policies of the Partnership can be found in Note 1 to the Financial Statements which is included in the Partnership’s December 31, 2006 Form 10-K.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations — continued

Property and Equipment: Property and equipment is stated at cost. Depreciation is computed using the straight-line method over estimated useful lives which are 20 years for land improvements, 35 years for buildings and improvements, and 10 years for machinery and equipment.

The Partnership accounts for property and equipment in accordance with Statement of Financial Accounting Standards No. (SFAS) 144, “Accounting for the Impairment or Disposal of Long Lived Assets.” SFAS 144 requires that long-lived assets be reviewed for impairment whenever events or changes in circumstances indicate that the carrying value of the asset may not be recoverable. In evaluating long-lived assets held for use, an impairment loss is recognized if the sum of the expected future cash flows (undiscounted and without interest charges) is less than the carrying value of the asset.

Once a determination has been made that an impairment loss should be recognized for long-lived assets, various assumptions and estimates are used to determine fair value including, among others, estimated costs of construction and development, recent sales of comparable properties and the opinions of fair value prepared by independent real estate appraisers. Long-lived assets to be disposed of are reported at the lower of carrying amount or fair value less cost to sell.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

None.

Item 4. Controls and Procedures

     (a) Evaluation of disclosure controls and procedures:

As of the end of the period covered by this quarterly report, we carried out an evaluation, under the supervision and with the participation of the Company’s management, including the Company’s President and Treasurer, of the effectiveness of the design and operation of the Company’s disclosure controls and procedures. Based upon that evaluation, the President and Treasurer concluded that the Company’s disclosure controls and procedures are effective in timely alerting them to material information relating to the Company required to be included in the Company’s periodic Securities and Exchange Commission filings.

     (b) Changes in internal controls:

There were no significant changes in the Company’s internal controls over financial reporting that occurred during our most recent fiscal quarter that materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

     (c) Asset-Backed issuers:

Not applicable.

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PART II. OTHER INFORMATION

There is no information required to be reported for any items under Part II, except as follows:

Item 1. Legal Proceedings

The General Partner of the Partnership is a defendant in a lawsuit related to a property line dispute for the restaurant on Baseline & Archibald in Rancho Cucamonga, California. The Partnership has an express easement covering the alleged encroachment and believes a blanket development easement covers the remainder of the alleged encroachment. The General Partner intends to defend against this lawsuit, although resolution of this matter could involve the Partnership acquiring the encroached territory.

Item 6. Exhibits and Reports

(a) Exhibits

31.1	Shirlene Lopez’s Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2	Steven L. Brake’s Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1	Certification pursuant to subsections (a) and (b) of Section 1350, Chapter 63 of Title 18, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

(b)	Reports
	None.

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	DEL TACO RESTAURANT PROPERTIES I
	(a California limited partnership)
	Registrant
	Del Taco LLC
	General Partner
Date: November 14, 2007	/s/ Steven L. Brake
	Steven L. Brake
	Treasurer

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EXHIBIT INDEX

Exhibits	Description
31.1	Shirlene Lopez’s Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2	Steven L. Brake’s Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1	Certification pursuant to subsections (a) and (b) of Section 1350, Chapter 63 of Title 18, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

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