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                                                                    Exhibit 99.1






                                BALANCE SHEET AND
                          INDEPENDENT AUDITORS' REPORT

                             RCC PARTNERS 96, L.L.C.

                                 MARCH 31, 2002



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                             RCC Partners 96, L.L.C.

                                TABLE OF CONTENTS

                                                                          PAGE

INDEPENDENT AUDITORS' REPORT                                               3


FINANCIAL STATEMENTS


     BALANCE SHEET                                                         4


     NOTES TO BALANCE SHEET                                                5


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                          INDEPENDENT AUDITORS' REPORT

To the Members of
RCC Partners 96, L.L.C.

We have audited the accompanying balance sheet of RCC Partners 96, L.L.C. as of
March 31, 2002. This balance sheet is the responsibility of the Company's
management. Our responsibility is to express an opinion on this balance sheet
based on our audit.

We conducted our audit in accordance with auditing standards generally accepted
in the United States of America. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the balance sheet
is free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the balance sheet. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall balance sheet
presentation. We believe that our audit provides a reasonable basis for our
opinion.

In our opinion, the balance sheet referred to above presents fairly, in all
material respects, the financial position of RCC Partners 96, L.L.C. as of March
31, 2002, in conformity with accounting principles generally accepted in the
United States of America.

Bethesda, Maryland
June 4, 2002


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                             RCC Partners 96, L.L.C.

                                  BALANCE SHEET

                                 March 31, 2002


<Table>
<Caption>
                                     ASSETS
<S>                                                                  <C>
Investment in limited partnership                                    $      0
Due from limited partnership                                          440,212
                                                                     --------

                                                                     $440,212
                                                                     ========
<Caption>
                         LIABILITIES AND MEMBERS' EQUITY
<S>                                                                  <C>
Due to affiliate                                                     $440,212
Members' equity                                                             0
                                                                     --------

                                                                     $440,212
                                                                     ========
</Table>




        The accompanying notes are an integral part of this balance sheet

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                             RCC Partners 96, L.L.C.

                             NOTES TO BALANCE SHEET

                                 March 31, 2002

NOTE A - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

RCC Partners 96, L.L.C. (the "Company") was organized under the laws of the
State of Delaware as of July 23, 1996, to act as the general partner of, and to
acquire and hold a general partnership interest in Patriot Tax Credit
Properties, L.P. ("Patriot").

On October 1, 1997, as part of a settlement of class litigation known as
Prudential Securities Inc. Limited Partnership Litigation, MDL No. 1005,
Prudential-Bache Properties, Inc. ("PBP") withdrew as the general partner and
transferred its General Partner interest in the Partnership to the Company, an
affiliate of Related Capital Company ("RCC") pursuant to a purchase agreement
dated as of December 19, 1996 among PBP and its affiliates and RCC.

Affiliates of the Company and RCC have had significant involvement with Patriot
and the Local Partnerships, of which five are owned by RCC affiliates. RCC in
the past provided, and will continue to provide ongoing monitoring services with
respect to the Limited Partnership's investments pursuant to the Property
Investment Monitoring Agreement.

INVESTMENT IN LIMITED PARTNERSHIP

The Company accounts for its investment in Patriot using the equity method,
whereby the Company adjusts the investment cost for its share of Patriot's
results of operations and for any distributions received or accrued.

The Company regularly assesses the carrying value of its investment in Patriot.
If the carrying value is considered to exceed the estimated value derived by
management (which contemplates remaining Low-income Tax Credits and potential
residual value, among other things), the Company reduces its investment in
Patriot.

USE OF ESTIMATES

The preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenue and expenses during
the reporting period. Actual results could differ from those estimates.

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                             RCC Partners 96, L.L.C.

                             NOTES TO BALANCE SHEET

                                 March 31, 2002

INCOME TAXES

The Company is not a taxpaying entity for income tax purposes and, accordingly,
no provision has been made for income taxes. The member's allocable shares of
the Company's taxable income or loss are reportable on their income tax returns.

NOTE B - RELATED PARTY TRANSACTIONS

DUE TO/FROM AFFILIATES

As of March 31, 2002, Patriot owes the Company $440,212 for partnership
management fees pursuant to the Limited Partnership Agreement. The Company owes
$440,212 to their affiliates as of March 31, 2002.

NOTE C - INVESTMENT IN LIMITED PARTNERSHIP

On October 1, 1997, the Company was admitted as the general partner in Patriot
Tax Credit Properties, L.P. which was formed to invest as a limited partner in
other partnerships owning apartment complexes that are eligible for the
low-income housing tax credit or the rehabilitation tax credit.

The investment in Limited Partnership is as follows:

<Table>
<S>                                                                 <C>
General Partner capital
     at December 31, 2001                                           $ 742,802

Less: Adjustment to estimates
     realizable value                                                (742,802)
                                                                    ---------

Balance - March 31, 2002                                            $       0
                                                                    =========
</Table>

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                             RCC Partners 96, L.L.C.

                             NOTES TO BALANCE SHEET

                                 March 31, 2002

The summarized consolidated balance sheet at March 31, 2002 and the summarized
consolidated statement of operations for the year then ended for Patriot Tax
Credit Properties, L.P. are as follows:

<Table>
<Caption>
                           CONSOLIDATED BALANCE SHEET

                                     ASSETS
<S>                                                                  <C>
INVESTMENT IN PROPERTY                                               $55,621,528

OTHER ASSETS
     Cash and cash equivalents                                         1,005,628
     Cash and cash equivalents, held in escrow                         1,681,511
     Deferred financing costs, net                                     1,879,582
     Other assets                                                        303,834
                                                                     -----------

Total assets                                                         $60,492,083
                                                                     ===========


<Caption>
                   LIABILITIES AND PARTNERS' CAPITAL (DEFICIT)
<S>                                                                  <C>
LIABILITIES

     Mortgage notes payable                                          $46,015,770
     Accrued interest payable                                          2,040,908
     Other accrued expenses and liabilities                            1,775,134
     Due to general partners and affiliates of local partnerships      4,651,838
     Development fees payable                                          1,151,510
     Real estate taxes payable                                            81,878
     Due to general partners and its affiliates                        6,565,471
                                                                     -----------

Total liabilities                                                     62,282,509
                                                                     -----------

Minority interest in local partnerships                                 (606,601)
                                                                     -----------

Partners' capital (deficit)
     Limited partners (38,125 BUC$ issued and outstanding)            (1,926,627)
     General partner (1 BUC$ issued and outstanding)                     742,802
                                                                     -----------

Total partners' capital (deficit)                                     (1,183,825)
                                                                     -----------

Total liabilities and partners' capital (deficit)                    $60,492,083
                                                                     ===========
</Table>


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                             RCC Partners 96, L.L.C.

                             NOTES TO BALANCE SHEET

                                 March 31, 2002

                      CONSOLIDATED STATEMENT OF OPERATIONS

NOTE C - INVESTMENT IN LIMITED PARTNERSHIP (Continued)

<Table>
<S>                                                                  <C>
Revenues

     Rental income                                                   $ 9,530,921
     Other income                                                        802,113
     Interest income                                                      38,065
                                                                     -----------

                                                                      10,371,099
                                                                     -----------

Expenses

     Interest                                                          4,689,172
     Depreciation and amortization                                     2,447,028
     Operating and other                                                 918,938
     Taxes and insurance                                               1,158,871
     Repairs and maintenance                                           2,540,544
     General and administrative                                        2,762,046
     Property management fees                                            424,360
     Partnership management fees                                         245,367
                                                                     -----------

     Total expenses                                                   15,186,326
                                                                     -----------

Loss before minority interest                                         (4,815,277)
Minority interest in loss of local partnership                         1,207,124
                                                                     -----------

Net loss                                                             $(3,608,103)
                                                                     ===========
</Table>

NOTE D - CONTINGENCIES

The Company is contingently liable for all debts, liabilities and other
obligations of Patriot Tax Credit Properties L.P. to the extent not paid by the
partnership.