-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, QK90lIB7OT+zgjFJ/oxHRLP8YIbRAcfGWO+Na/kNq4U2HJXZMLf3zp+0O7NCbTzc MpCEatyOicA7RoOcY3iG7w== 0000810663-06-000017.txt : 20060214 0000810663-06-000017.hdr.sgml : 20060214 20060214153927 ACCESSION NUMBER: 0000810663-06-000017 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20051231 FILED AS OF DATE: 20060214 DATE AS OF CHANGE: 20060214 FILER: COMPANY DATA: COMPANY CONFORMED NAME: BOSTON FINANCIAL TAX CREDIT FUND VIII LP CENTRAL INDEX KEY: 0000911568 STANDARD INDUSTRIAL CLASSIFICATION: OPERATORS OF APARTMENT BUILDINGS [6513] IRS NUMBER: 043205879 FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: 10QSB SEC ACT: 1934 Act SEC FILE NUMBER: 000-26522 FILM NUMBER: 06614341 BUSINESS ADDRESS: STREET 1: 101 ARCH ST CITY: BOSTON STATE: MA ZIP: 02110 BUSINESS PHONE: 6174393911 FORMER COMPANY: FORMER CONFORMED NAME: BOSTON FINANCIAL TAX CREDIT FUND VIII DATE OF NAME CHANGE: 19930902 10QSB 1 tc8q305.txt TC8Q305 February 14, 2006 Securities and Exchange Commission 450 Fifth Street, N.W. Washington, D.C. 20549 Re: Boston Financial Tax Credit Fund VIII, A Limited Partnership Report on Form 10-QSB for the Quarter Ended December 31, 2005 File Number 0-26522 Dear Sir/Madam: Pursuant to the requirements of Section 15(d) of the Securities Exchange Act of 1934, filed herewith is a copy of subject report. Very truly yours, /s/Stephen Guilmette Stephen Guilmette Assistant Controller TC8-Q2.DOC UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-QSB (Mark One) [ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended December 31, 2005 -------------------------------------- OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to --------------------- ---------------- Commission file number 0-26522 Boston Financial Tax Credit Fund VIII, A Limited Partnership (Exact name of registrant as specified in its charter) Massachusetts 04-3205879 - --------------------------------- ----------------------------- (State or other jurisdiction of (I.R.S. Employer Identification No.) incorporation or organization) 101 Arch Street, Boston, Massachusetts 02110-1106 - --------------------------------------------- ----------------------------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code (617) 439-3911 ----------------------- 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 . BOSTON FINANCIAL TAX CREDIT FUND VIII, A LIMITED PARTNERSHIP TABLE OF CONTENTS
PART I. FINANCIAL INFORMATION Page No. - ------------------------------ -------- Item 1. Financial Statements Balance Sheet (Unaudited) - December 31, 2005 1 Statements of Operations (Unaudited) - For the Three and Nine Months Ended December 31, 2005 and 2004 2 Statement of Changes in Partners' Equity (Deficiency) (Unaudited) - For the Nine Months Ended December 31, 2005 3 Statements of Cash Flows (Unaudited) - For the Nine Months Ended December 31, 2005 and 2004 4 Notes to the Financial Statements (Unaudited) 5 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 7 PART II - OTHER INFORMATION Items 1-6 12 SIGNATURE 13 CERTIFICATIONS 14
BOSTON FINANCIAL TAX CREDIT FUND VIII, A LIMITED PARTNERSHIP BALANCE SHEET December 31, 2005 (Unaudited)
Assets Cash and cash equivalents $ 262,212 Investment securities, at fair value (Note 1) 274,180 Investments in Local Limited Partnerships (Note 2) 7,207,592 Other assets 2,855 --------------- Total Assets $ 7,746,839 =============== Liabilities and Partners' Equity Due to affiliate $ 677,068 Accrued expenses 56,696 --------------- Total Liabilities 733,764 --------------- General, Initial and Investor Limited Partners' Equity 7,015,512 Net unrealized losses on investment securities (2,437) --------------- Total Partners' Equity 7,013,075 --------------- Total Liabilities and Partners' Equity $ 7,746,839 ===============
The accompanying notes are an integral part of these financial statements. BOSTON FINANCIAL TAX CREDIT FUND VIII, A LIMITED PARTNERSHIP STATEMENTS OF OPERATIONS For the Three and Nine Months Ended December 31, 2005 and 2004 (Unaudited)
Three Months Ended Nine Months Ended December 31, December 31, December 31, December 31, 2005 2004 2005 2004 ---------------- ---------------- ---------------- -------------- Revenue Investment $ 10,447 $ 1,454 $ 28,271 $ 4,093 ---------------- ---------------- ---------------- -------------- Total Revenue 10,447 1,454 28,271 4,093 ---------------- ---------------- ---------------- -------------- Expenses: Asset management fees, related party 59,627 57,721 178,879 174,239 Provision for valuation of advances to Local Limited Partnerships (Note 2) - 73,076 - 73,076 Provision for valuation of investments in Local Limited Partnerships (Note 2) 11,633 - 11,633 - General and administrative (includes reimbursement to affiliate in the amounts of $46,297 and $84,079 in 2005 and 2004, respectively) 35,097 47,046 123,866 140,106 Amortization 3,437 7,032 17,502 21,096 ---------------- ---------------- ---------------- -------------- Total Expense 109,794 184,875 331,880 408,517 ---------------- ---------------- ---------------- -------------- Loss before equity in losses of Local Limited Partnerships (99,347) (183,421) (303,609) (404,424) Equity in losses of Local Limited Partnerships (Note 2) (245,543) (121,986) (538,436) (507,056) ---------------- ---------------- ---------------- -------------- Net Loss $ (344,890) $ (305,407) $ (842,045) $ (911,480) ================ ================ ================ ============== Net Loss allocated: General Partners $ (3,449) $ (3,054) $ (8,420) $ (9,115) (3,054) Limited Partners (341,441) (302,353) (833,625) (902,365) ---------------- ---------------- ---------------- -------------- $ (344,890) $ (305,407) $ (842,045) $ (911,480) ================ ================ ================ ============== Net Loss Per Limited Partner Unit (36,497) Units $ (9.35) $ (8.28) $ (22.84) $ (24.72) ================ ================ ================ ============== The accompanying notes are an integral part of these financial statements.
BOSTON FINANCIAL TAX CREDIT FUND VIII, A LIMITED PARTNERSHIP STATEMENT OF CHANGES IN PARTNERS' EQUITY (DEFICIENCY) For the Nine Months Ended December 31, 2005 (Unaudited)
Net Initial Investor Unrealized General Limited Limited Gains Partners Partner Partner (Losses) Total Balance at March 31, 2005 $ (237,771) $ 100 $ 8,095,228 $ 44 $ 7,857,601 ----------- ----------- -------------- ------------- -------------- Comprehensive Loss: Change in net unrealized gains on investment securities available for sale - - - (2,481) (2,481) Net Loss (8,420) - (833,625) - (842,045) ----------- ----------- -------------- ------------ -------------- Comprehensive Loss (8,420) - (833,625) (2,481) (844,526) ----------- ----------- -------------- ------------ -------------- Balance at December 31, 2005 $ (246,191) $ 100 $ 7,261,603 $ (2,437) $ 7,013,075 =========== =========== ============== ============ ==============
The accompanying notes are an integral part of these financial statements. BOSTON FINANCIAL TAX CREDIT FUND VIII, A LIMITED PARTNERSHIP STATEMENTS OF CASH FLOWS For the Nine Months Ended December 31, 2005 and 2004 (Unaudited)
2005 2004 ------------- --------- Net cash used for operating activities $ (815,093) $ (38,278) Net cash provided by investing activities 744,919 43,567 ------------- -------------- Net increase (decrease) in cash and cash equivalents (70,174) 5,289 Cash and cash equivalents, beginning 332,386 341,433 ------------- -------------- Cash and cash equivalents, ending $ 262,212 $ 346,722 ============= ==============
The accompanying notes are an integral part of these financial statements. BOSTON FINANCIAL TAX CREDIT FUND VIII, A LIMITED PARTNERSHIP NOTES TO FINANCIAL STATEMENTS (Unaudited) The unaudited financial statements presented herein have been prepared in accordance with the instructions to Form 10-QSB and do not include all of the information and note disclosures required by accounting principles generally accepted in the United States of America. These statements should be read in conjunction with the financial statements and notes thereto included with the Fund's Form 10-KSB for the year ended March 31, 2005. In the opinion of the General Partner, these financial statements include all adjustments, consisting only of normal recurring adjustments, necessary to present fairly the Fund'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. The General Partner of the Fund has elected to report results of the Local Limited Partnerships in which the Fund has a limited partnership interest on a 90 day lag basis because the Local Limited Partnerships report their results on a calendar year basis. Accordingly, the financial information about the Local Limited Partnerships that is included in the accompanying financial statements is as of September 30, 2005 and 2004. 1. Investment Securities The Fund's investment securities are classified as "Available for Sale" and are carried at fair value as reported by the brokerage firms at which they are held, with unrealized gains or losses excluded from earnings and reported as a separate component of partner's equity. 2. Investments in Local Limited Partnerships The Fund has limited partnership interests in ten Local Limited Partnerships, which were organized for the purpose of owning and operating multi-family housing complexes, all of which are government assisted. The Fund's ownership interest in the Local Limited Partnerships is 99%, with the exception of Springwood, which is 79.20%, Hemlock Ridge, which is 77% and Pike Place and West End Place, which are 90%. The Fund may have negotiated or may negotiate options with the Local General Partners to purchase or sell the Fund's interests in the Local Limited Partnerships at the end of the Compliance Period at nominal prices. In the event that Local Limited Partnerships are sold to a third parties, or upon dissolution of the Local Limited Partnerships, proceeds will be distributed according to the terms of each Local Limited Partnership agreement. The following is a summary of investments in Local Limited Partnerships at December 31, 2005:
Capital contributions and advances paid to Local Limited Partnerships and purchase price paid to withdrawing partners of Local Limited Partnerships $ 30,513,168 Cumulative equity in losses of Local Limited Partnerships (excluding cumulative unrecognized losses of $2,394,078) (19,137,226) Cumulative cash distributions received from Local Limited Partnerships (2,127,316) --------------- Investments in Local Limited Partnerships before adjustments 9,248,626 Excess investment costs over the underlying assets acquired: Acquisition fees and expenses 1,048,010 Cumulative amortization of acquisition fees and expenses (304,976) --------------- Investments in Local Limited Partnerships before impairment allowance 9,991,660 Impairment allowance on investments in Local Limited Partnerships (2,784,068) --------------- Investments in Local Limited Partnerships $ 7,207,592 ===============
BOSTON FINANCIAL TAX CREDIT FUND VIII, A LIMITED PARTNERSHIP NOTES TO FINANCIAL STATEMENTS (continued) (Unaudited) 2. Investments in Local Limited Partnerships (continued) The Fund has recorded an impairment allowance for its investments in certain Local Limited Partnerships in order to appropriately reflect the estimated net realizable value of these investments. The Fund's share of net losses of the Local Limited Partnerships for the nine months ended December 31, 2005 is $818,156. For the nine months ended December 31, 2005, the Fund has not recognized $279,720 of equity in losses relating to two Local Limited Partnerships where cumulative equity in losses and cumulative distributions exceeded its total investment in the Local Limited Partnership. 3. Significant Equity Investees The following Local Limited Partnerships invested in by the Fund represent more than 20% of the Fund's total assets or equity as of either December 31, 2005 or 2004 or net losses for the three months ended either December 31, 2005 or 2004. The following financial information represents the performance of these Local Limited Partnerships for the three months ended December 31, 2005 and/or 2004:
Beaverdam Creek Associates, a Limited Partnership 2005 2004 ------------------------------------------------- ------------- ------------- Revenue $ 296,782 $ 306,576 Net Income (Loss) $ (41,178) $ 43,749 Oak Knoll Renaissance, a Limited Partnership Revenue $ 494,656 $ 517,514 Net Income $ (47,393) $ 32,636 Live Oaks Plantation Revenue $ N/A $ 456,961 Net Loss $ N/A $ (69,474)
BOSTON FINANCIAL TAX CREDIT FUND VIII, A LIMITED PARTNERSHIP MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Certain matters discussed herein constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The Fund intends such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements and is including this statement for purposes of complying with these safe harbor provisions. Although the Fund believes the forward-looking statements are based on reasonable assumptions, the Fund can give no assurance that its expectations will be attained. Actual results and timing of certain events could differ materially from those projected in or contemplated by the forward-looking statements due to a number of factors, including, without limitation, general economic and real estate conditions and interest rates. Critical Accounting Policies The Fund's accounting polices include those that relate to its recognition of investments in Local Limited Partnerships using the equity method of accounting. The Fund's policy is as follows: The Fund accounts for its investments in Local Limited Partnerships using the equity method of accounting. Under the equity method, the investment is carried at cost, adjusted for the Fund's share of net income or loss and for cash distributions from the Local Limited Partnerships; equity in income or loss of the Local Limited Partnerships is included currently in the Fund's operations. Under the equity method, a Local Limited Partnership investment will not be carried below zero. To the extent that equity in losses are incurred when the Fund's carrying value of the respective Local Limited Partnership has been reduced to a zero balance, the losses will be suspended and offset against future income. Income from Fund investments where cumulative equity in losses plus cumulative distributions have exceeded the total investment in Local Limited Partnerships will not be recorded until all of the related unrecorded losses have been offset. To the extent that a Local Limited Partnership with a carrying value of zero distributes cash to the Fund, that distribution is recorded as income on the books of the Fund and is included in "Other Revenue" in the accompanying financial statements. The Fund has implemented policies and practices for assessing potential impairment of its investments in Local Limited Partnerships. The investments are reviewed for impairment whenever events or changes in circumstances indicate that the Fund may not be able to recover its carrying value. If an other than temporary impairment in carrying value exists, a provision to reduce the asset to fair value will be recorded in the Fund's financial statements. In January 2003, the FASB issued Interpretation No. 46 ("Interpretation"), "Consolidation of Variable Interest Entities", which provides new criteria for determining whether or not consolidation accounting is required. The Interpretation, which was modified in December 2003 in order to address certain technical and implementation issues, requires the Fund to consider consolidation or provide additional disclosures of financial information for Local Limited Partnerships meeting the definition of a Variable Interest Entity ("VIE"). The Fund was required to apply the Interpretation to the Local Limited Partnerships meeting the definition of a VIE as of March 31, 2005. This Interpretation requires consolidation by the Fund of the Local Limited Partnerships' assets and liabilities and results of operations if the Fund determined that the Local Limited Partnerships were VIEs and that the Fund was the "Primary Beneficiary". Minority interests may be recorded for the Local Limited Partnerships' ownership share attributable to other investors. Where consolidation of Local Limited Partnerships is not required, additional financial information disclosures of Local Limited Partnerships may be required. The Fund has assessed the Interpretation and concluded that it is not the Primary Beneficiary of any of the Local Limited Partnerships that meet the definition of a VIE. The Fund is involved with those VIEs as a non-controlling limited partner equity holder. The Fund is required to disclose its maximum exposure to economic and financial statement losses as a result of its involvement with the VIEs. The Fund's exposure to economic and financial statement losses from the VIEs is limited to its investment in the VIEs ($7,207,592 at December 31, 2005). The Fund may be subject to additional losses to the extent of any financial support that the Fund voluntarily provides in the future. BOSTON FINANCIAL TAX CREDIT FUND VIII, A LIMITED PARTNERSHIP MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued) Liquidity and Capital Resources At December 31, 2005, the Fund had cash and cash equivalents of $262,212, as compared to $332,386 at March 31, 2005. This decrease is primarily attributable to cash used for operations and purchases of investment securities and is partially offset by cash distributions received from Local Limited Partnerships. Cash used for operations includes $775,000 paid to the General Partner for Asset Management Fees. The General Partner initially designated 5% of the Gross Proceeds as Reserves, as defined in the Partnership Agreement. The Reserves were established to be used for working capital of the Fund and contingencies related to the ownership of Local Limited Partnership interests. The General Partner may increase or decrease such Reserves from time to time, as it deems appropriate. At December 31, 2005, $536,392 of cash, cash equivalents and investment securities has been designated as Reserves. To date, professional fees relating to various Property issues totaling approximately $62,000 have been paid from Reserves. In the event a Local Limited Partnership encounters operating difficulties requiring additional funds, the Fund's management might deem it in its best interest to voluntarily provide such funds in order to protect its investment. As of December 31, 2005, the Fund has advanced approximately $1,248,000 to Local Limited Partnerships to fund operating deficits. The General Partner believes that the investment income earned on the Reserves, along with cash distributions received from Local Limited Partnerships, to the extent available, will be sufficient to fund the Fund's ongoing operations. Reserves may be used to fund operating deficits, if the General Partner deems funding appropriate. To date, the Fund has used approximately $22,000 of operating funds to replenish Reserves. If Reserves are not adequate to cover the Fund's operations, the Fund will seek other financing sources including, but not limited to, the deferral of Asset Management Fees paid to an affiliate of the General Partner or working with Local Limited Partnerships to increase cash distributions. Since the Fund invests as a limited partner, the Fund has no contractual duty to provide additional funds to Local Limited Partnerships beyond its specified investment. Thus, as of December 31, 2005, the Fund had no contractual or other obligation to any Local Limited Partnership which had not been paid or provided for. Cash Distributions No cash distributions were made to Limited Partners during the nine months ended December 31, 2005. It is not expected that cash available for distribution, if any, will be significant during the 2006 calendar year. Based on the results of Property operations, most of the Local Limited Partnerships are not expected to distribute significant amounts of cash to the Fund as such amounts may be needed to fund Property operating costs. In addition, some of the Properties benefit from some type of federal or state subsidy and, as a consequence, are subject to restrictions on cash distributions. Results of Operations Three Month Period For the three months ended December 31, 2005, the Fund's operations resulted in a net loss of $344,890, as compared to $305,407 for the three months ended December 31, 2004. The increase in net loss is primarily attributable to an increase in equity in losses of Local Limited Partnerships and an increase in provision for valuation of investments. The increase in equity in losses of Local Limited Partnerships is primarily due to an increase in property operating expenses at some of the Properties. The increase in provision for valuation of investments in Local Limited Partnerships is a result of the Partnership recognizing non-temporary declines in the carrying value of its investment in certain Local Limited Partnerships. BOSTON FINANCIAL TAX CREDIT FUND VIII, A LIMITED PARTNERSHIP MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued) Results of Operations (continued) Nine Month Period For the nine months ended December 31, 2005, the Fund's operations resulted in a net loss of $842,045, as compared to $911,480 for the nine months ended December 31, 2004. The decrease in net loss is primarily attributable to a decrease in provision for valuation of advances to Local Limited Partnerships and an increase in investment revenue and is partially offset by an increase in equity in losses of Local Limited Partnerships. The decrease in provision for valuation of advances to Local Limited Partnerships is the result of a decrease in advances made to Local Limited Partnerships during the current year. The increase in investment revenue is due to an increase in the average balance of funds held for investments. Portfolio Update The Fund's investment portfolio consists of limited partnership interests in ten Local Limited Partnerships, each of which owns and operates a multi-family apartment complex and each of which has generated Tax Credits. Since inception, the Fund has generated Tax Credits of approximately $1,379 per Limited Partner Unit, with approximately $53 of Tax Credits expected to be generated for 2005, the expected final year of Tax Credits. In the aggregate, actual and estimated Tax Credits will enable the Fund to meet the objective specified in the Fund's prospectus. Properties that receive low income housing Tax Credits must remain in compliance with rent restrictions and set aside requirements for at least 15 years from the date the property is completed (the "Compliance Period"). Failure to do so would result in the recapture of a portion of the property's Tax Credits. Between 2008 and continuing through 2009, the Compliance Period of the ten Properties in which the Fund has an interest will expire. It is unlikely that the General Partner will be able to dispose of the Fund's Local Limited Partnership interests concurrently with the expiration of each Property's Compliance Period. The Fund shall dissolve and its affairs shall be wound up upon the disposition of the final Local Limited Partnership interest and other assets of the Fund. Investors will continue to be Limited Partners, receiving K-1s and quarterly and annual reports, until the Fund is dissolved. On August 24, 2004, the Fund, Boston Financial Qualified Housing Tax Credits L.P., Boston Financial Qualified Housing Tax Credits L.P. II, Boston Financial Qualified Housing Tax Credits L.P. III, Boston Financial Qualified Housing Tax Credits L.P. IV, Boston Financial Qualified Housing Tax Credits L.P. V, Boston Financial Tax Credit Fund Plus, A Limited Partnership and Boston Financial Tax Credit Fund VII, A Limited Partnership (collectively, the "Partnerships"), and their general partners commenced litigation against Everest Housing Investors 2, LLC ("Everest 2") and several other Everest-related entities (collectively, the "Everest Entities") in Massachusetts state court, seeking a declaratory judgment that certain materials the Everest Entities sought to inspect are not "books and records" of the Partnerships and that the Everest Entities are in any case not entitled to inspect said information under applicable partnership agreements, partnership law or otherwise. On October 7, 2004, the Everest Entities filed an answer and counterclaim against the Partnerships and their purported general partners, claiming that they breached applicable partnership agreements, partnership law and their fiduciary duties to the Everest Entities by failing to make the purported "books and records" available. On January 12, 2005, the Partnerships served a motion to amend their complaint to, among other things, add a claim based on Everest 2's breach of a November 24, 2003 letter agreement which compelled Everest 2 to keep confidential certain information contemporaneously disseminated by four of the Partnerships to Everest 2. Having received no opposition within the specified time, the Partnerships filed the motion to amend with the proposed first amended complaint on January 31, 2005. The Court has granted this Motion, and the discovery process is continuing. BOSTON FINANCIAL TAX CREDIT FUND VIII, A LIMITED PARTNERSHIP MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued) Portfolio Update (continued) The Partnerships maintain that the Everest Entities are not entitled to review the materials requested and/or use the materials in secondary market transactions because, among other things: (i) they are not "books and records" of the Partnerships; (ii) the Everest Entities do not seek to review them for a proper purpose; and (iii) selective disclosure of the information to the Everest Entities would give them an unfair informational advantage in secondary market transactions and may violate federal and/or state securities laws. The Partnerships have not formed an opinion that an unfavorable outcome is either probable or remote. Therefore, the Partnerships' counsel refrains from expressing an opinion as to the likely outcome of the case or the range of any loss. Property Discussions Most of the Properties in which the Fund has an interest have stabilized operations and operate above break-even. A few Properties generate cash flow deficits that the Local General Partners of those Properties fund through project expense loans, subordinated loans or operating escrows. However, a few Properties have had persistent operating difficulties that could either: i) have an adverse impact on the Fund's liquidity; ii) result in their foreclosure; or iii) result in the General Partner deeming it appropriate for the Fund to dispose of its interest in the Local Limited Partnership prior to the expiration of the Compliance Period. Also, the General Partner, in the normal course of the Fund's business, may arrange for the future disposition of its interest in certain Local Limited Partnerships. The following Property discussions focus only on such Properties. As previously reported, the Local General Partner of Live Oaks Plantation, located in West Palm Beach, Florida, indicated a desire to transfer its interest in the Local Limited Partnership to a replacement Local General Partner. Accordingly, the General Partner began working with the Local General Partner to identify an acceptable replacement. Negotiations to replace the Local General Partner were then delayed due to an audit by the Internal Revenue Service ("IRS"). The audit focused on the tax treatment of certain items, such as land improvements, impact fees, utility fees and developer fees. In April 2002, the Florida office of the IRS issued their report indicating an eligible basis reduction of approximately $1,000,000, which would reduce the amount of Tax Credits and losses generated by the Property. The Local General Partner filed an appeal of the report to the Washington D.C. office of the IRS. The appeal was successful, and during April 2004 a settlement was reached whereby the eligible basis was reduced by approximately $93,000. As a result, the Fund had recapture of previously taken Tax Credits of approximately $2 per Unit. Tax Credits for 2005 will also be reduced by approximately $0.25 per Unit. Subsequent to reaching a settlement with the IRS, negotiations to replace the Local General Partner resumed. Effective June 28, 2004, an affiliate of the General Partner replaced the Local General Partner. In June 2005, the Local General Partner interest was transferred from the affiliate of the General Partner to a replacement Local General Partner. While occupancy and working capital levels at the Property have consistently remained adequate, the Property generated significant operating deficits in 2001 and 2002. The Fund funded slightly more than $1,000,000 of deficits from Fund Reserves. The General Partner anticipates that cash from operations will continue to fund the monthly debt service. Occupancy at the Property averaged 88% for the three months ended September 30, 2005, while debt service coverage and working capital have remained above appropriate levels during the same period. As previously reported, turnover at Green Wood Apartments, located in Gallatin, Tennessee, as a result of few employment opportunities in the immediate area, continues to cause a decline in Property operations. Rental concessions, in an effort to alleviate the turnover issue, along with higher utility and administrative expenses, continue to hinder the Property's ability to operate at above breakeven. Despite an overall improvement in occupancy levels since 2004, occupancy and debt service coverage both remain below appropriate levels as of September 30, 2005. The Local General Partner continues to fund the operating deficits, enabling the Property to remain current on its loan obligations. The General Partner will continue to closely monitor Property operations. BOSTON FINANCIAL TAX CREDIT FUND VIII, A LIMITED PARTNERSHIP MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued) Property Discussions (continued) As previously reported, Meadow Wood of Pella, located in Pella, Iowa, had experienced operating deficits in recent quarters due to reduced revenues resulting from low occupancy and high expenses. While very acceptable levels of occupancy over the six months ended September 30, 2005 have alleviated revenue issues, high expenses, mainly administrative and insurance, resulted in an operating deficit for the six months ended September 30, 2005.This operating deficit was funded by the Property's operating reserve as well as working capital. The Local General Partner has fulfilled its working capital obligation and will no longer fund operating deficits. A recent modification to the Property's HOME loan resulting in a reduction to the required annual debt service payment beginning in 2006 is expected to lead to an improvement in operations. The Property remains current on its debt service. The General Partner will continue to closely monitor Property operations. As previously reported, in 2004 the Local General Partner of Beaverdam Creek, located in Mechanicsville, Virginia, requested approval for a refinancing on the Property's first mortgage. As part of the agreement to provide the General Partner's approval of the refinancing, a put agreement was entered into whereby the Fund has the right to transfer its interest in the Local Limited Partnership for a nominal price at any time after December 31, 2009, the end of the Property's Compliance Period. As a result of the refinancing, which closed on May 4, 2005, the Fund received Sale or Refinancing Proceeds, as defined in the Local Limited Partnership Agreement, of $890,727. The General Partner, in accordance with and as permitted by the Partnership Agreement, retained the entire amount of net proceeds in Reserves. BOSTON FINANCIAL TAX CREDIT FUND VIII, A LIMITED PARTNERSHIP PART II OTHER INFORMATION Items 1-5 Not applicable Item 6 Exhibits and reports on Form 8-K (a) Exhibits 31.1 Certification of Principal Executive Officer and Principal Financial Officer pursuant to section 302 of the Sarbanes-Oxley Act of 2002 32.1 Certification of Principal Executive Officer and Principal Financial Officer pursuant to section 906 of the Sarbanes-Oxley Act of 2002 (b) Reports on Form 8-K - No reports on Form 8-K were filed during the quarter ended December 31, 2005. BOSTON FINANCIAL TAX CREDIT FUND VIII, A LIMITED PARTNERSHIP 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. DATED: February 14, 2006 BOSTON FINANCIAL TAX CREDIT FUND VIII, A LIMITED PARTNERSHIP By: Arch Street VIII Limited Partnership, its General Partner /s/Jenny Netzer Jenny Netzer Executive Vice President MMA Financial, LLC EX-32 2 exhinit32.txt TC8Q305 BOSTON FINANCIAL TAX CREDIT FUND VIII, A LIMITED PARTNERSHIP EXHIBIT 32.1 CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 In connection with the Quarterly Report of Boston Financial Tax Credit Fund VIII (the "Fund") on Form 10-QSB for the period ended December 31, 2005 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), the undersigned, the Principal Executive Officer and Principal Financial Officer, hereby certifies pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that: 1. the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and 2. the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Partnership. /s/Jenny Netzer ------------------------------------ Jenny Netzer Principal Executive Officer and Principal Financial Officer Arch Street VIII, LP, as General Partner of Boston Financial Tax Credit Fund VIII, A Limited Partnership Date: February 14, 2006 A signed original of this written statement required by Section 906 has been provided to the Fund and will be retained by the Fund and furnished to the Securities and Exchange Commission or its staff upon request. EX-31 3 exhibit31.txt TC8Q305 BOSTON FINANCIAL TAX CREDIT FUND VIII, A LIMITED PARTNERSHIP EXHIBIT 31.1 I, Jenny Netzer, certify that: 1. I have reviewed this quarterly report on Form 10-QSB of Boston Financial Tax Credit Fund VIII; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the small business issuer as of, and for, the periods presented in this report; 4. I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act rules 13a-15(e) and 15d-15(e)) for the small business issuer and have: (a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under my supervision, to ensure that material information relating to the small business issuer, including its consolidated subsidiaries, is made known to me by others within those entities, particularly during the period in which this report is being prepared; (b) Evaluated the effectiveness of the small business issuer's disclosure controls and procedures and presented in this report my conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and (c) Disclosed in this report any change in the small business issuer's internal control over financial reporting that occurred during the small business issuer's most recent fiscal quarter (the small business issuer's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the small business issuer's internal control over financial reporting; and 5. I have disclosed, based on my most recent evaluation of internal control over financial reporting, to the small business issuer's auditors and the audit committee of the small business issuer's board of directors (or persons performing the equivalents functions): (a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the small business issuer's ability to record, process, summarize and report financial information; and (b) any fraud, whether or not material, that involves management or other employees who have a significant role in the small business issuer's internal control over financial reporting. Date: February 14, 2006 /s/Jenny Netzer ------------------------------------ Jenny Netzer Principal Executive Officer and Principal Financial Officer Arch Street VIII, LP, as General Partner of Boston Financial Tax Credit Fund VIII, A Limited Partnership -----END PRIVACY-ENHANCED MESSAGE-----