SC TO-T/A

Securities and Exchange Commission

Washington, DC 20549

Schedule TO-T/A

Tender offer statement under section 14(d)(1) OR 13(e)(1)

of the Securities Exchange Act of 1934

(Amendment No. 2)

Boston Financial Qualified Housing Tax Credits L.P. III

(Name of Subject Company(issuer))

Paco Development, L.L.C. (offeror)

SLCas, L.L.C. (other person)

(Names of Filing Persons (identifying status as

offeror, issuer or other person))

Units of Limited Partnership Interest

(Title of Class of Securities)

None

(CUSIP Number of Class of Securities)

Lathrop & Gage L.C.

Attn: Scott M. Herpich

2345 Grand Boulevard

Suite 2400

Kansas City, Missouri 64108

Telephone (816) 292-2000

(Name, address and telephone number of person

authorized to receive notices and communications

on behalf of filing persons)

Calculation of Filing Fee

Transaction valuation*	Amount of filing fee
$214,500	$42.90

* Calculated as the product of the Units on which the Offer is made and the gross cash price per Unit.

[X] Check box if any part of the fee is offset as provided by Rule 0-11(a)(2) and identify the filing with which the offsetting fee was previously paid. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.

Amount previously paid:	$42.90	Filing party:	Paco Development, L.L.C.
Form or registration no.:	SC TO-T	Date filed:	March 10, 2006

[ ] Check box if the filing relates solely to preliminary communications made before the commencement of a tender offer.

Check the appropriate boxes below to designate any transactions to which the statement relates:

[X] third-party tender offer subject to Rule 14d-1.

[ ] issuer tender offer subject to Rule 13e-4.

[ ] going-private transaction subject to Rule 13e-3.

[ ] amendment to Schedule 13D under Rule 13d-2.

Check the following box if the filing is a final amendment reporting the results of the tender offer: [   ]

This Amendment No. 2 (this “Amendment”) amends and supplements the Tender Offer Statement on Schedule TO (the “Schedule TO”) filed with the Securities and Exchange Commission on March 10, 2006, as amended on April 11, 2006, by Paco Development, L.L.C., a Missouri limited liability company (the “Purchaser”), relating to an offer (the “Offer”) by the Purchaser to purchase Units of limited partnership interests of Boston Financial Qualified Housing Tax Credits L.P. III, a Delaware limited partnership (the “Partnership”) at a cash purchase price of $63 per Unit, without interest, less the amount of Distributions (as defined in the Offer to Purchase (as defined below)) per Unit, if any, made to Unit holders by the Partnership after the date of the Offer, and less any transfer fees imposed by the Partnership for each transfer (the Purchaser believes the Partnership is currently charging $150 per trade) upon the terms and subject to the conditions set forth in the Offer to Purchase, dated March 10, 2006, as it may be supplemented or amended from time to time (the “Offer to Purchase”), and the related Agreement of Transfer and Letter of Transmittal, as it may be supplemented or amended from time to time (the “Letter of Transmittal,” which, together with the Offer to Purchase, constitutes the “Offer”), copies of which were filed as Exhibits (a)(1)(i) and (a)(1)(ii) to the Schedule TO, respectively. Capitalized terms used but not defined herein have the meaning ascribed to them in the Offer to Purchase.

SLCas, LLC added as bidder

Although not involved in structuring and determining the terms of the Offer, SLCas, LLC is being added as a bidder as a result of its ownership of the Purchaser. The Offer to Purchase and all related documents are amended to reflect the addition of SLCas, LLC as a bidder.

Item 1. Summary Term Sheet

Item 1 is amended and supplemented as follows.

(a)The eighth bullet point under “RISK FACTORS” in the Offer to Purchase is deleted in its entirety and replaced with the following:

We believe that the Partnership’s agreement of limited partnerships prohibits the transfer of an interest if such transfer, together with all other transfers during the preceding 12 months, would cause 50% of the total interest in capital and profits of that partnership to be transferred within such 12-month period. Because an unaffiliated third party maintains the transfer records of the Partnership, we have been unable to ascertain how many Units have been transferred in the previous twelve month period (we are aware of approximately 5,040Units being transferred in the last 12 months, which amounts to approximately 5.0% of the 100,000 Units believed to be outstanding). If Units are validly tendered and not withdrawn that would cause more than 50% of the total interest and capital of the Partnership to be transferred within a 12-month period, we will accept for payment and pay for those Units so tendered pro rata according to the number of Units so tendered, with appropriate adjustments to avoid purchases of fractional Units. The Partnership's general partner has indicated that it will enforce a transfer limitation, in which case the Purchaser will not be able to acquire 100% of the Units.

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Item 3. Identity and Background of Filing Person

The second paragraph under "CERTAIN INFORMATION CONCERNING THE PURCHASER" in the Offer to Purchase is deleted in its entirety and replaced with the following:

Although not involved in structuring and determining the terms of the Offer, SLCas is also included as a bidder as a result of its ownership of the Purchaser. Sandra L. Castetter (“Ms. Castetter”) is the sole member of SLCas. Ms. Castetter is a citizen of the United States whose address is 104 Armour Road, North Kansas City, Missouri 64116. Ms. Castetter invests in various real estate and other business ventures, but is not otherwise employed, nor has she been employed during the past five years.

Item 4. Terms of the Transaction

Item 4 of the Schedule TO is supplemented and amended as follows:

(a)The third paragraph under “DETAILS OF THE OFFER - 1. TERMS OF THE OFFER; EXPIRATION DATE; PRORATION” in the Offer to Purchase is deleted in its entirety and replaced with the following:

If transfers of Units are limited by the Partnership Agreement to a number of Units (the “Transfer Limit”), and the number of Units that are Properly Tendered exceeds the Transfer Limit, the Purchaser will, upon the terms and subject to the other conditions of the Offer, accept for payment and pay for Units equal to the Transfer Limit, pro rata, according to the number of Units that are Properly Tendered by each Unit Holder, with appropriate adjustments to avoid purchases of fractional Units. Specifically, the Purchaser anticipates rounding up or down to the nearest whole Unit; provided, however, if necessary, the Purchaser might have to round down to avoid purchasing more than the stated maximum number of Units. Subject to its obligation to pay for Units promptly after the Expiration Date (as set forth below in "Acceptance for Payment and Payment of Purchase Price"), the Purchaser intends to pay for any Units accepted for payment pursuant to the Offer after determining the final proration or other adjustments. The Purchaser does not believe it would take any longer than five business days to determine the effects of any proration required. If the number of Units that are Properly Tendered is less than or equal to the Transfer Limit, if any, the Purchaser will purchase all Units that are Properly Tendered, upon the terms and subject to the other conditions of the Offer. See “Effects of the Offer - Limitations on Resales.”

(b)The following is added after the last paragraph under "FEDERAL INCOME TAX MATTERS" in the Offer to Purchase:

The Code provides that if 50% or more of the capital and profits interests in a partnership are sold or exchanged within a single 12-month period, such partnership generally will terminate for federal income tax purposes. It is possible that the Partnership could terminate for federal income tax purposes as a result of consummation of the Offer (although the Partnership Agreement prevents transfers of Units that would cause such a termination). A tax termination of the Partnership could have an effect on a corporate or other non-individual Unit holder whose tax year is not the calendar year, as

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such a Unit holder might recognize more than one year's Partnership tax items in one tax return, thus accelerating by a fraction of a year the effects from such items.

(c)The third paragraph under “EFFECTS OF THE OFFER” in the Offer to Purchase is deleted in its entirety and replaced with the following:

The possibility exists that the general partner will deny the transfer of Units. The Purchaser is aware of approximately 5,040Units being transferred in the last 12 months (which amounts to approximately 5.0% of the 100,000 Units outstanding). The Purchaser should know whether the general partner will transfer the Units tendered when the Partnership's transfer agent provides confirmation of transfers, which occurs on a quarterly basis (the next confirmation date subsequent to the expiration of this offer will beJuly 1, 2006).

Item 11. Additional Information

Item 11 is amended and supplemented as follows.

(c)The fourth paragraph under "CERTAIN INFORMATION CONCERNING THE PURCHASER - Prior Acquisitions of Units and Prior Contacts" in the Offer to Purchase is deleted in its entirety and replaced with the following:

On October 27, 2005, Bond Purchase, L.L.C. ("Bond Purchase") filed a lawsuit against an affiliate of the Partnership in the District Court of Johnson County, Kansas, Case No. 05-CV-8489. Bond Purchase brought claims relating to the affiliate's disposing of its investments and/or dissolving without obtaining the approval of the limited partners. Bond Purchase filed a motion to dismiss the case without prejudice because the affiliate indicated that statements in the Form 10-K were mistakes. The motion was granted, and the lawsuit was dismissed without prejudice on April 3, 2006.

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SIGNATURE

After due inquiry and to the best of my knowledge and belief, the undersigned certify that the information set forth in this statement is true, complete and correct.

Dated: April 21, 2006.

PACO DEVELOPMENT, L.L.C., a Missouri limitedliability company
By: /s/ DeAnn Duffield
	DeAnn Duffield, Manager
SLCas, L.L.C.
By: /s/ DeAnn Duffield
	DeAnn Duffield, Manager

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CORRESP

LATHROP & GAGE L.C.

2345 GRAND BOULEVARD, SUITE 2800

KANSAS CITY, MISSOURI 64108

April 21, 2006

Via Facsimile (202) 772-9203

and Edgar

Celeste M. Murphy, Esq.

Special Counsel

Securities and Exchange Commission

100 F Street, N.E.

Washington D.C. 20549

Re: Boston Financial Qualified Housing Tax Credits L.P. III

       Schedule TO-T filed on March 10, 2006, by Paco Development, L.L.C.

 File No. 5-81103

Dear Ms. Murphy:

We received your letter dated April 17, 2006 (the “Comment Letter”), in which you commented on the Schedule TO-T (the “Schedule TO”) described above. The responses of Paco Development, L.L.C.("Paco") to your comments are set forth below. For your convenience, the original comments from your Comment Letter are reproduced below in bold type. Capitalized terms used herein have the same meanings as in the Schedule TO.

Cover Page

1.   We note that you have added SLCas, L.L.C. as a filing person to your schedule TO. Please amend your Schedule TO to identify this filing person, explain why you have added such filing person, why SLCas was not included in the initial filing. Please amend your definition of “Purchaser” in your offering materials to include SLCas.

Response: Although not involved in structuring and determining the terms of the Offer, SLCas was included as a signing person in the initial Schedule TO because of the possibility it would be deemed a bidder as a result of its ownership of the Purchaser.

As an expedient to completing this tender offer, following SEC comments to other tender offers involving Paco (and without agreeing with the position that SLCas is a bidder), we revised the Schedule TO to add SLCas to the cover page. Furthermore, in this amendment, Paco revised disclosure in the Offer to Purchase indicating that SLCas might be deemed a bidder to reflect that SLCas is a bidder, which revised disclosures are

reflected in the Schedule TO amendment filed contemporaneously with Paco's responses to this Comment Letter.

Because Paco is the actual Purchaser, and will be the only entity having direct beneficial ownership of the Units acquired in the tender offer, it is the only entity included in the definition of Purchaser. However, the Offer to Purchase has been amended to state definitively that SLCas is a bidder, and previously contained the requisite disclosure regarding SLCas as a bidder.

Units Sought, page 2

2.   We note that you have amended your offer to purchase all of the outstanding units. Further, we note that your Schedule TO filed March 10, 2006 addresses the Partnership’s agreement of limited partnerships prohibiting the transfer of an interest if such transfer, together with all other transfers during the preceding 12 months, would cause 50% of the total interest in capital and profits of that partnership to be transferred within such 12-month period. You state, in that March 10, 2006 filing that you do “not know whether the general partner will enforce a transfer limitation.” We believe that the general partner has made clear, in both 14D-9 filings of March 17, 2006 and April 14, 2006, that the general partner will enforce transfer limitations. Please revise your disclosure accordingly. In addition, we believe that you should detail the pro-ration procedures in the event of “oversubscription.” Further, you should state that you cannot acquire 100% of the units through the tender offer.

Response: The Schedule TO has been revised in response to your comment.

Certain Information Concerning the Participants, page 4

3.   We note that you have filed, together with other participants, a preliminary proxy filing for a consent solicitation. We are unable to locate such filing. Please advise.

Response: Paco, together with certain participants made a preliminary proxy filing with the SEC in connection with a consent solicitation with respect to Boston Financial Qualified Housing Tax Credits, L.P. IV ("Boston Financial 4"). Those participants have not made any preliminary proxy filing with respect to the Partnership. On April 10, 2006, Paco sent a letter to limited partners which references the Boston Financial 4 preliminary proxy filing, and in the abundance of caution, we included the required legend in the letter in case the letter was deemed to be proxy solicitation materials with respect to the Boston Financial 4 consent solicitation. The legend clearly identified that the consent solicitation related to Boston Financial 4.

4.   Please provide us with your detailed legal analysis of how the parties you list as participants are related to Paco Development L.L.C. and why these parties should not be included as filing persons on this Schedule TO. We expect this detailed

analysis of your structure, including these parties, and bidder legal analysis regardless of the answer to our comment above.

Response: As set forth in the answer to Comment 3 above, Paco, together with certain participants made a preliminary proxy filing with the SEC in connection with a consent solicitation with respect to Boston Financial Qualified Housing Tax Credits, L.P. IV. Because those participants have not made any preliminary proxy filing with respect to the Partnership (only with respect to Boston Financial 4), and had no involvement with this tender offer, they should not be included as filing persons.

Closing Comments

While acknowledging the Staff's position, and without implying any specific issue with such position, we respectfully decline to make the statements requested. There is no requirement that we do so. To the extent the requested statements are accurate statements of applicable law, there is no reason to obtain from bidders a recitation of such law. To the extent the statements go beyond applicable law or reflect interpretations of law that may be open to dispute, it would not be fair or appropriate to require bidders to make statements that might prejudice their right to take a contrary position at some later time, if the occasion arose.

Paco is filing an amendment concurrently with this letter. We do not believe that the amendment materially changes the information already provided to the Unit holders. Please do not hesitate to contact me at (816) 460-5806 with any questions or comments you may have regarding the above responses and to advise us if the Staff has any further comments

Very truly yours,

LATHROP & GAGE L.C.

By: /s/ Scott M. Herpich

Scott M. Herpich