Related Party Disclosures

6 Months Ended

Jun. 30, 2011

Related Party Disclosures

Related Party Transactions Disclosure [Text Block]

NOTE 3 – TRANSACTIONS WITH AFFILIATED PARTIES

Under the terms of the Amended and Restated Agreement of the Limited Partnership, the Partnership is obligated to the General Partner for the following fees:

(a)   An annual Partnership management fee in an amount equal to 0.5 percent of invested assets (as defined in the Partnership Agreement) as of the beginning of the year is payable to the General Partner. For the six months ended June 30, 2011 and 2010, approximately $81,000 and $93,000, respectively, has been expensed. During the six months ended June 30, 2011, approximately $130,000 of partnership management fees were paid from the proceeds received from the Partnership’s sale of its limited partnership interest in Rolling Hills. There were no payments made during the six months ended June 30, 2010. At June 30, 2011 and December 31, 2010, approximately $1,058,000 and $1,107,000, respectively, is owed to the General Partner and is included in accrued fees due to affiliates.

(b)   A property disposition fee is payable to the General Partner in an amount equal to the lesser of (i) one-half of the competitive real estate commission that would have been charged by unaffiliated third parties providing comparable services in the area where the apartment complex is located, or (ii) 3 percent of the sales price received in connection with the sale or disposition of the apartment complex or local partnership interest, but in no event will the property disposition fee and all amounts payable to unaffiliated real estate brokers in connection with any such sale exceed in the aggregate, the lesser of the competitive rate (as described above) or 6 percent of such sale price. Receipt of the property disposition fee will be subordinated to the distribution of sale or refinancing proceeds by the Partnership until the limited partners have received distributions of sale or refinancing proceeds in an aggregate amount equal to (i) their 10 percent priority return for any year not theretofore satisfied (as defined in the Partnership Agreement) and (ii) an amount equal to the aggregate adjusted investment (as defined in the Partnership Agreement) of the limited partners.  No disposition fees have been paid.

(c)   The Partnership reimburses NAPICO for certain expenses. The reimbursement to NAPICO was approximately $20,000 and $30,000 for the six months ended June 30, 2011 and 2010, respectively, and is included in general and administrative expenses. During the six months ended June 30, 2011, the Partnership paid all outstanding reimbursements of approximately $173,000 from the proceeds received from sale of its limited partnership interest in Rolling Hills. There were no payments made during the six months ended June 30, 2010. At December 31, 2010, approximately $153,000 was owed to NAPICO and was included in accrued fees due to affiliates. There were no such fees owed at June 30, 2011.

As of June 30, 2011, the fees due to the General Partner exceeded the Partnership’s cash. The Partnership Agreement provides that the fees due to the General Partner may only be paid from the Partnership’s available cash, however, the Partnership still remains liable for all such amounts.

NTC, or another affiliate of the General Partner, is the Local Operating General Partner in three of the Partnership's five Local Partnerships.  In addition, NTC is either a special limited partner or an administrative general partner in each Local Partnership.

An affiliate of the General Partner managed one property owned by a Local Partnership, Tyrone Elderly, during the six months ended June 30, 2010. The Local Partnership paid the affiliate property management fees in the amount of 5 percent of their gross rental revenues.  The amount paid was approximately $19,000 for the six months ended June 30, 2010. Tyrone Elderly sold its investment property on August 25, 2010.

The General Partner is not obligated to advance funds to the Partnership for operations or to fund Partnership advances to Local Partnerships, but may voluntarily do so from time to time. Accordingly during the six months ended June 30, 2010, an affiliate of the General Partner advanced the Partnership approximately $63,000 to fund partnership operating expenses. The advances bore interest at prime plus 2% and incurred interest expense of approximately $2,000 for the six months ended June 30, 2010, which was included in general and administrative expenses. During the third quarter of 2010 the Partnership repaid all outstanding advances and associated accrued interest of approximately $90,000 from a distribution received from the sale of the investment property owned by Tyrone Elderly. There were no advances during the six months ended June 30, 2011. The Partnership may receive additional advances of funds from AIMCO Properties, L.P., although AIMCO Properties, L.P. is not obligated to provide such advances.  For more information on AIMCO Properties, L.P., including copies of its audited balance sheet, please see its reports filed with the Securities and Exchange Commission.