-----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, EW7zkGXABWofExWF6aktRppGSjjhYwzNxmTSSdd7ifwsT8GcOU+/gp5lT6bHzro5 eQ+S53jwpUfcB9M1l9DGag== 0000810663-06-000082.txt : 20061114 0000810663-06-000082.hdr.sgml : 20061114 20061114171903 ACCESSION NUMBER: 0000810663-06-000082 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20060930 FILED AS OF DATE: 20061114 DATE AS OF CHANGE: 20061114 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: 061216829 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 tc8q206.txt TC8Q206 Microsoft Word 11.0.6502; November 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 September 30, 2006 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 September 30, 2006 -------------------------------------- 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) - September 30, 2006 1 Statements of Operations (Unaudited) - For the Three and Six Months Ended September 30, 2006 and 2005 2 Statement of Changes in Partners' Equity (Deficiency) (Unaudited) - For the Six Months Ended September 30, 2006 3 Statements of Cash Flows (Unaudited) - For the Six Months Ended September 30, 2006 and 2005 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 September 30, 2006 (Unaudited)
Assets Cash and cash equivalents $ 261,556 Investment securities, at fair value 149,625 Investments in Local Limited Partnerships (Note 1) 6,872,730 Other assets 2,887 --------------- Total Assets $ 7,286,798 =============== Liabilities and Partners' Equity Due to affiliate $ 915,065 Accrued expenses 81,233 --------------- Total Liabilities 996,298 --------------- General, Initial and Investor Limited Partners' Equity 6,290,875 Net unrealized losses on marketable securities (375) --------------- Total Partners' Equity 6,290,500 --------------- Total Liabilities and Partners' Equity $ 7,286,798 ===============
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 Six Months Ended September 30, 2006 and 2005 (Unaudited) Three Months Ended Six Months Ended September 30, September 30, September 30, September 30, 2006 2005 2006 2005 ---------------- ---------------- ---------------- -------------- Revenue Investment $ 4,869 $ 13,364 $ 11,894 $ 17,824 ---------------- ---------------- ---------------- --------------- Total Revenue 4,869 13,364 11,894 17,824 ---------------- ---------------- ---------------- --------------- Expenses: Asset management fees, related party 61,892 59,626 123,545 119,252 Provision for valuation allowance on advances to Local Limited Partnerships (Note 1) - - 136,323 - General and administrative (includes reimbursement to affiliate in the amounts of $36,551 and $35,396 for the six months ended September 30, 2006 and 2005, respectively) 39,431 47,937 127,399 88,769 Amortization 3,174 7,033 6,611 14,065 ---------------- ---------------- ---------------- --------------- Total Expense 104,497 114,596 393,878 222,086 ---------------- ---------------- ---------------- --------------- Loss before equity in losses of Local Limited Partnerships (99,628) (101,232) (381,984) (204,262) Equity in income (losses) of Local Limited Partnerships (Note 1) 113,626 (154,008) (3,056) (292,893) ---------------- ---------------- ---------------- --------------- Net Income (Loss) $ 13,998 $ (255,240) $ (385,040) $ (497,155) ================ ================ ================ =============== Net Income (Loss) allocated: General Partners $ 140 $ (2,552) $ (3,850) $ (4,971) Limited Partners 13,858 (252,688) (381,190) (492,184) ---------------- ---------------- ---------------- --------------- $ 13,998 $ (255,240) $ (385,040) $ (497,155) ================ ================ ================ =============== Net Income (Loss) Per Limited Partner Unit (36,497) Units $ 0.38 $ (6.92) $ (10.44) $ (13.49) ================ ================ ================ ===============
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 Six Months Ended September 30, 2006 (Unaudited)
Initial Investor Net General Limited Limited Unrealized Partners Partner Partner Losses Total Balance at March 31, 2006 $ (249,587) $ 100 $ 6,925,402 $ (1,079) $ 6,674,836 ----------- ----------- -------------- ------------- -------------- Comprehensive Income (Loss): Change in net unrealized losses on investment securities available for sale - - - 704 704 Net Loss (3,850) - (381,190) - (385,040) ----------- ----------- -------------- ------------ -------------- Comprehensive Income (Loss) (3,850) - (381,190) 704 (384,336) ----------- ----------- -------------- ------------ -------------- Balance at September 30, 2006 $ (253,437) $ 100 $ 6,544,212 $ (375) $ (6,290,500) =========== =========== ============== ============ ==============
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 Six Months Ended September 30, 2006 and 2005 (Unaudited)
2006 2005 ------------- --------------- Net cash used for operating activities $ (53,818) $ (34,624) Net cash provided by (used for) investing activities (31,292) 723,102 ------------- -------------- Net increase (decrease) in cash and cash equivalents (85,110) 688,478 Cash and cash equivalents, beginning 346,666 332,386 ------------- -------------- Cash and cash equivalents, ending $ 261,556 $ 1,020,864 ============= ============== 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 Form10-KSB for the year ended March 31, 2006. In the opinion of the Managing 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 Managing 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 June 30, 2006 and 2005. 1. 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 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 September 30, 2006:
Capital contributions and advances paid to Local Limited Partnerships $ 30,649,491 Cumulative equity in losses of Local Limited Partnerships (excluding cumulative unrecognized losses of $2,884,666) (19,357,010) Cumulative cash distributions received from Local Limited Partnerships (2,232,347) --------------- Investments in Local Limited Partnerships before adjustments 9,060,134 Excess investment costs over the underlying assets acquired: Acquisition fees and expenses 1,048,010 Cumulative amortization of acquisition fees and expenses (315,023) --------------- Investments in Local Limited Partnerships before valuation allowance 9,793,121 Valuation allowance on investments in Local Limited Partnerships (2,920,391) --------------- Investments in Local Limited Partnerships $ 6,872,730 ===============
BOSTON FINANCIAL TAX CREDIT FUND VIII, A LIMITED PARTNERSHIP NOTES TO FINANCIAL STATEMENTS (continued) (Unaudited) 1. Investments in Local Limited Partnerships (continued) During the six months ended September 30, 2006, the Fund advanced $136,323 to one of the Local Limited Partnerships, all of which was reserved. The Fund has recorded a valuation 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 six months ended September 30, 2006 is $235,493. For the six months ended September 30, 2006, the Fund has not recognized $232,437 of equity in losses relating to five Local Limited Partnerships where cumulative equity in losses and cumulative distributions exceeded its total investment in the Local Limited Partnership. 2. Significant Subsidiaries The following Local Limited Partnerships invested in by the Fund represent more than 20% of the Fund's total assets or equity as of September 30, 2006 or 2005 or net losses for the three months ended either September 30, 2006 or 2005. The following financial information represents the performance of these Local Limited Partnerships for the three months ended June 30, 2006 and 2005:
Beaverdam Creek Associates, a Limited Partnership 2006 2005 - ------------------------------------------------- --------------- ------------- Revenue $ 290,615 $ 247,263 Net Income $ 60,382 $ 25,032 Oak Knoll Renaissance, Limited Partnership Revenue $ 515,754 $ 536,371 Net Income $ 90,306 $ 59,343 Schickedanz Brothers Palm Beach Limited Revenue $ N/A $ 449,600 Net Loss $ N/A $ (84,400) Spring Apartments, A Limited Partnership Revenue $ 260,561 $ 223,075 Net Loss $ (28,316) $ (42,917) Pike Place, A Limited Partnership Revenue $ 176,923 $ 160,684 Net Loss $ (11,121) $ (9,044)
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 Local Limited Partnerships in which the Fund invests are Variable Interest Entities ("VIE"s). The Fund is involved with the VIEs as a non-controlling limited partner equity holder. Because the Fund is not the primary beneficiary of these VIEs, it accounts for its investments in the Local Limited Partnerships using the equity method of accounting. As a result of its involvement with the VIEs, the Fund exposure to economic and financial statement losses is limited to its investments in the VIEs ($6,872,730 at September 30, 2006). The Fund may be subject to additional losses to the extent of any financial support that the Fund voluntarily provides in the future. 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 Local Limited Partnerships, 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 other-than-temporary declines in values of its investments in Local Limited Partnerships. Periodically, the carrying values of the investments are compared to their respective fair values. If an other-than-temporary decline in carrying value exists, a provision to reduce the asset to fair value, as calculated based primarily on remaining tax benefits, will be recorded in the Fund's financial statements. Generally, the carrying values of most Local Limited Partnerships will decline through losses and distributions in amounts sufficient to prevent other-than-temporary impairments. However, the Fund may record impairment losses in the future if the expiration of tax credits outpaces losses and distributions from any of the Local Limited Partnerships. Liquidity and Capital Resources At September 30, 2006, the Fund had cash and cash equivalents of $261,556, as compared to $346,666 at March 31, 2006. The decrease is primarily attributable to advances paid to Local Limited Partnerships and cash used for operations. These losses were partially offset by cash distributions received from Local Limited Partnerships. 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 September 30, 2006, $411,181 of cash, cash equivalents and investment securities has been designated as Reserves. 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 (continued) 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 September 30, 2006, the Fund has advanced approximately $1,385,000 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 Fund operating deficits, if the General Partner deems funding appropriate. To date, the Fund has used approximately $33,000 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 September 30, 2006, 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 during the six months ended September 30, 2006. Results of Operations Three Month Period For the three months ended September 30, 2006, the Fund's operations resulted in net income of $13,998, as compared to a net loss of $255,240 for the three months ended September 30, 2005. The decrease in net loss is primarily attributable to a decrease in equity in losses of Local Limited Partnerships. Equity in losses of Local Limited Partnerships decreased to due an increase in rental income at some of the properties. Six Month Period For the six months ended September 30, 2006, the Fund's operations resulted in a net loss of $385,040, as compared to a net loss of $497,155 for the six months ended September 30, 2005. The decrease in net loss is primarily attributable to a decrease in equity in losses of Local Limited Partnerships. The decrease in equity in losses of Local Limited Partnerships is primarily due to an increase in rental income at some of the properties. The decrease is partially offset by an increase in provision for valuation allowance on advances to Local Limited Partnerships and an increase in general and administrative expenses. The increase in provision for valuation allowance on advances to Local Limited Partnership is the result of an increase in advances made to Local Limited Partnerships in 2006, as compared to the same period of 2005. General and administrative expenses increased due to increased legal expenses associated with litigation in which the Fund is currently involved. BOSTON FINANCIAL TAX CREDIT FUND VIII, A LIMITED PARTNERSHIP MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued) Portfolio Update The Fund is a Massachusetts limited partnership organized to invest in Local Limited Partnerships which own and operate apartment complexes which are eligible for low income housing tax credits that may be applied against the federal income tax liability of an investor. The Fund's objectives are to: (i) provide investors with annual tax credits which they may use to reduce their federal income tax liability; (ii) provide limited cash distributions rom the operations of apartment complexes; and (iii) preserve and protect the Fund's capital. Arch Street VIII Limited Partnership ("Arch Street L.P."), a Massachusetts limited partnership consisting of Arch Street VIII, Inc., a Massachusetts corporation ("Arch Street, Inc.") as the sole general partner and MMA as the sole limited partner, is the sole General Partner of the Fund. Arch Street L.P. and Arch Street, Inc. are affiliates of MMA. The fiscal year of the Fund ends on March 31. As of September 30, 2006, 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 $1,429 per Limited Partner Unit. The aggregate amount of Tax Credits generated by the Fund was consistent with the objective specified in the Fund's prospectus. Properties that receive low income housing Tax Credits must remain in compliance with rent restriction and set-aside requirements for at least 15 calendar years from the date the property is placed in service (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. The General Partner has negotiated an agreement that will ultimately allow the Funds to dispose of its interest in one Local Limited Partnership. The Fund has not disposed of any Local Limited Partnership interests during the six months ended September 30, 2006. On August 24, 2004, the Fund, Boston Financial Qualified Housing Limited Partnership, 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 and the general partners moved 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. The Court granted this Motion. Discovery is continuing in this matter, but no activity has taken place in recent months as the parties have been discussing whether a negotiated resolution of the matter is possible. 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 and their general partners 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 and their general partners have not formed an opinion that an unfavorable outcome is either probable or remote, and their counsel refrains from expressing an opinion as to the likely outcome of the case or the range of any loss. Property Discussions All of the Properties in which the Fund has an interest had stabilized operations and operated above break-even at June 30, 2006. A few Properties have generated cash flow deficits in prior periods that the Local General Partners of those Properties funded through project expense loans, subordinated loans or operating escrows. However, a few Properties have previously experienced 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, in the event below breakeven operations recur. 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. 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 95% for the six months ended June 30, 2006, while debt service coverage and working capital remained above appropriate levels during the same period. 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 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued) Property Discussions (continued) As previously reported, turnover at Green Wood Apartments, located in Gallatin, Tennessee, as a result of few employment opportunities in the immediate area, was the main cause for below breakeven operations at the Property. Rental concessions, provided in an effort to alleviate the turnover issue, have proven successful, at least in the short term, as rental revenue increased to a level sufficient to result in above breakeven operations at June 30,2006. Occupancy averaged 92% throughout the six-month period ending June 30,2006 while debt service coverage and working capital were at acceptable levels as of June 30, 2006 The General Partner will continue to closely monitor Property operations. The General Partner and Local General Partner have reached an agreement that may result in a 2006 sale of this Property. Under the current terms, a sale would result in net proceeds to the Fund of approximately $370,000, or $10 per Unit, and taxable income of approximately $33,000, or $1 per Unit. 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 September 30, 2006 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: November 14, 2006 BOSTON FINANCIAL TAX CREDIT FUND VIII, A LIMITED PARTNERSHIP By: Arch Street VIII Limited Partnership, its General Partner /s/Gary Mentesana Gary Mentesana President Arch Street VIII, Inc. EX-31 2 exhibit31q2.txt TC8EXH31Q2 BOSTON FINANCIAL TAX CREDIT FUND VIII, A LIMITED PARTNERSHIP EXHIBIT 31.1 I, Gary Mentesana, 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 our supervision, to ensure that material information relating to the small business issuer, including its consolidated subsidiaries, is made known to us 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 our 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 our 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 November 14, 2006 /s/Gary Mentesana -------------------------------------- Gary Mentesana Principal Executive Officer and Principal Financial Officer Arch Street VIII, LP, as Managing General Partner of Boston Financial Tax Credit Fund VIII EX-32 3 exhibit32q2.txt TC8EXH32Q2 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 September 30, 2006 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/Gary Mentesana -------------------------------------- Gary Mentesana Principal Executive Officer and Principal Financial Officer Arch Street VIII, LP, as Managing General Partner of Boston Financial Tax Credit Fund VIII, A Limited Partnership Date: November 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. -----END PRIVACY-ENHANCED MESSAGE-----