FORM 10-Q

                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549

                                   (Mark One)

      x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
                              EXCHANGE ACT OF 1934

                  For the quarterly period ended June 30, 2000

                                       OR

      o 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: 0-23908


                  WNC CALIFORNIA HOUSING TAX CREDITS III, L.P.


California                                                           33-0531301
(State or other jurisdiction of                                (I.R.S. Employer
incorporation or organization)                               Identification No.)


              3158 Redhill Avenue, Suite 120, Costa Mesa, CA 92626

                                 (714) 662-5565


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 ____ No X .




<PAGE>
                  WNC CALIFORNIA HOUSING TAX CREDITS III, L.P.
                       (A California Limited Partnership)

                               INDEX TO FORM 10-Q

                       For the Quarter Ended June 30, 2000


PART I. FINANCIAL INFORMATION

 Item 1. Financial Statements

  Balance Sheets,
           June 30, 2000 and March 31, 2000.................................2

  Statements of Operations
           For the three months ended June 30, 2000 and 1999................3

  Statement of Partners' Equity (Deficit)
           For the three months ended June 30, 2000.........................4

  Statements of Cash Flows
           For the three months ended June 30, 2000 and 1999................5

  Notes to Financial Statements.............................................6

 Item 2. Management's Discussion and Analysis of Financial
  Condition and Results of Operations......................................11

 Item 3. Quantitative and Qualitative Disclosures About Market Risks.......13

PART II. OTHER INFORMATION

 Item 1. Legal Proceedings.................................................13

 Item 6. Exhibits and Reports on Form 8-K..................................13

 Signatures ...............................................................14


                                       1

<PAGE>
                  WNC CALIFORNIA HOUSING TAX CREDITS III, L.P.
                       (A California Limited Partnership)

                                 BALANCE SHEETS
<TABLE>
<CAPTION>

                                                                   June 30, 2000                  March 31, 2000
                                                                --------------------            --------------------
                                                                    (unaudited)
                                     ASSETS
<S>                                                           <C>                            <C>
Cash and cash equivalents                                     $           486,323            $            480,598
Investments in limited
 partnerships, net (Note 2)                                             7,986,258                       8,224,971
                                                                --------------------            --------------------

                                                              $         8,472,581            $          8,705,569
                                                                ====================            ====================

                   LIABILITIES AND PARTNERS' EQUITY (DEFICIT)

Liabilities:
 Accrued fees and expenses due to
  General Partner and affiliates (Note 3)                     $           763,125            $            718,279
                                                                --------------------            --------------------

     Total liabilities                                                    763,125                         718,279
                                                                --------------------            --------------------
Partners' equity (deficit):
 General Partner                                                          (93,036)                        (90,258)
 Limited Partners (30,000 units
  Authorized; 18,000 units issued
  and outstanding)                                                      7,802,492                       8,077,548
                                                                --------------------            --------------------

     Total partners' equity                                             7,709,456                       7,987,290
                                                                --------------------            --------------------

                                                              $         8,472,581            $          8,705,569
                                                                ====================            ====================
</TABLE>

                 See accompanying notes to financial statements
                                        2

<PAGE>
                  WNC CALIFORNIA HOUSING TAX CREDITS III, L.P.
                       (A California Limited Partnership)

                            STATEMENTS OF OPERATIONS

                For the Three Months Ended June 30, 2000 and 1999
                                   (unaudited)
<TABLE>
<CAPTION>


                                                                    2000                              1999
                                                         ---------------------------         -----------------------

<S>                                                    <C>                                 <C>
Interest income                                        $                     5,264         $                 4,987
                                                         ---------------------------         -----------------------

                                                                             5,264                           4,987
                                                         ---------------------------         -----------------------
Operating expenses:
 Amortization (Note 2)                                                      15,116                          15,116
 Asset management fees (Note 3)                                             45,346                          45,346
 Other                                                                       4,477                           8,012
                                                         ---------------------------         -----------------------

   Total operating expenses                                                 64,939                          68,474
                                                         ---------------------------         -----------------------

Loss from operations                                                       (59,675)                        (63,487)
                                                         ---------------------------         -----------------------

Equity in losses of
 limited partnerships (Note 2)                                            (218,159)                       (229,696)
                                                         ---------------------------         -----------------------

Net loss                                               $                  (277,834)        $              (293,183)
                                                         ===========================         =======================

Net loss allocated to:
 General partner                                       $                    (2,778)        $                (2,932)
                                                         ===========================         =======================

 Limited partners                                      $                  (275,056)        $              (290,251)
                                                         ===========================         =======================

Net loss per limited partnership unit
 (18,000 issued and outstanding)                       $                       (15)        $                   (16)
                                                         ===========================         =======================

</TABLE>

                 See accompanying notes to financial statements
                                        3

<PAGE>
                  WNC CALIFORNIA HOUSING TAX CREDITS III, L.P.
                       (A California Limited Partnership)

                     STATEMENT OF PARTNERS' EQUITY (DEFICIT)

                    For the Three Months Ended June 30, 2000
                                   (unaudited)
<TABLE>
<CAPTION>

                                                     General                  Limited
                                                     Partner                  Partners                  Total
                                                ------------------        -----------------        -----------------

<S>                                           <C>                       <C>                      <C>
Equity (deficit), March 31, 2000              $          (90,258)       $       8,077,548        $       7,987,290

Net loss for the three months ended
 June 30, 2000                                            (2,778)                (275,056)                (277,834)
                                                ------------------        -----------------        -----------------

Equity (deficit), June 30, 2000               $          (93,036)       $       7,802,492        $       7,709,456
                                                ==================        =================        =================


</TABLE>



                 See accompanying notes to financial statements
                                        4



<PAGE>
                  WNC CALIFORNIA HOUSING TAX CREDITS III, L.P.
                       (A California Limited Partnership)

                            STATEMENTS OF CASH FLOWS

                For the Three Months Ended June 30, 2000 and 1999
                                   (unaudited)
<TABLE>
<CAPTION>
                                                                          2000                      1999
                                                                   -----------------         ------------------
<S>                                                             <C>                       <C>
Cash flows from operating activities:
 Net loss                                                       $        (277,834)        $         (293,183)
 Adjustments to reconcile net loss to net cash
  provided by operating activities:
  Amortization                                                             15,116                     15,116
  Equity in losses of limited partnerships                                218,159                    229,696
  Change in accrued fees and expenses due
   to General Partner and affiliates                                       44,846                    52,558
                                                                   -----------------         ------------------

      Net cash provided by operating activities                               287                      4,187
                                                                   -----------------         ------------------

Cash flows provided by investing activities:
 Distributions from limited partnerships                                    5,438                      4,335
                                                                   -----------------         ------------------

Net increase in cash and cash equivalents                                   5,725                      8,522

Cash and cash equivalents, beginning of period                            480,598                    509,695
                                                                   -----------------         ------------------

Cash and cash equivalents, end of period                        $         486,323         $          518,217
                                                                   =================         ==================

</TABLE>


                 See accompanying notes to financial statements
                                        5

<PAGE>
                  WNC CALIFORNIA HOUSING TAX CREDITS III, L.P.
                       (A California Limited Partnership)

                          NOTES TO FINANCIAL STATEMENTS

                                  June 30, 2000
                                   (unaudited)

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

General

The accompanying condensed consolidated unaudited financial statements have been
prepared in accordance with generally accepted accounting principles for interim
financial  information  and with the  instructions  to Form  10-Q for  quarterly
reports  under  Section  13 or 15(d)  of the  Securities  Exchange  Act of 1934.
Accordingly,  they do not include all of the information and footnotes  required
by generally accepted accounting  principles for complete financial  statements.
In the opinion of management,  all adjustments  (consisting of normal  recurring
accruals)  considered  necessary  for a fair  presentation  have been  included.
Operating  results for the three months ended June 30, 2000 are not  necessarily
indicative  of the results that may be expected for the fiscal year ending March
31,  2001.  For  further  information,  refer to the  financial  statements  and
footnotes thereto included in the  Partnership's  annual report on Form 10-K for
the fiscal year ended March 31, 2000.

Organization

WNC California  Housing Tax Credits III, L.P. a California  Limited  Partnership
(the  "Partnership"),  was formed on October 5, 1992 under the laws of the state
of California and began  operations on July 19, 1993. The Partnership was formed
to  invest  primarily  in  other  limited   partnerships   (the  "Local  Limited
Partnerships")  which  own  and  operate  multi-family  housing  complexes  (the
"Housing  Complex") that are eligible for low income housing credits.  The local
general   partners  (the  "Local  General   Partners")  of  each  Local  Limited
Partnership retain  responsibility  for maintaining,  operating and managing the
Housing Complex.

The  general  partner  is WNC  Tax  Credit  Partners  III,  L.P.  (the  "General
Partner"). WNC & Associates, Inc. ("WNC" or "Associates") is the general partner
of WNC Tax Credit Partners III, L.P.  Wilfred N. Cooper Sr.,  through the Cooper
Revocable Trust owns 66.8% of the outstanding stock of WNC. John B. Lester,  Jr.
was the original limited partner of the Partnership and owns, through the Lester
Family Trust,  28.6% of the outstanding  stock of WNC.  Wilfred N. Cooper,  Jr.,
President of WNC, owns 2.1% of the outstanding stock of WNC. The business of the
Partnership  is  conducted  primarily  through  WNC,  as WNC  TCP  III  and  the
Partnership have no employees of their own.

The  Partnership  Agreement  authorized the sale of up to 30,000 units at $1,000
per Unit  ("Units").  The offering of Units concluded in July 1994 at which time
17,990 Units, representing subscriptions in the amount of $17,990,000,  had been
accepted. During 1995, an additional 10 units amounting to $10,000 was collected
on  subscriptions  accepted and  previously  deemed  uncollectible.  The General
Partner has a 1% interest in operating  profits and losses,  taxable  income and
losses,  cash available for distribution from the Partnership and tax credits of
the  Partnership.  The limited  partners  will be allocated the remaining 99% of
these items in proportion to their respective investments.

After the limited  partners  have received  proceeds from a sale or  refinancing
equal to their capital  contributions and their return on investment (as defined
in the  Partnership  Agreement)  and the General  Partner has received  proceeds
equal  to its  capital  contribution  and a  subordinated  disposition  fee  (as
described in Note 3) from the  remainder,  any  additional  sale or  refinancing
proceeds will be distributed 90% to the limited partners (in proportion to their
respective investments) and 10% to the General Partner.

                                       6

<PAGE>
                  WNC CALIFORNIA HOUSING TAX CREDITS III, L.P.
                       (A California Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

                       For the Quarter Ended June 30, 2000
                                   (unaudited)

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, continued

Risks and Uncertainties

The Partnership's  investments in Local Limited  Partnerships are subject to the
risks incident to the management and ownership of low-income  housing and to the
management and ownership of multi-unit  residential  real estate.  Some of these
risks  are that the low  income  housing  credit  could be  recaptured  and that
neither the  Partnership's  investments  nor the Housing  Complexes owned by the
Local Limited Partnerships will be readily marketable. To the extent the Housing
Complexes  receive  government  financing  or operating  subsidies,  they may be
subject to one or more of the following risks: difficulties in obtaining tenants
for the Housing Complexes; difficulties in obtaining rent increases; limitations
on cash distributions; limitations on sales or refinancing of Housing Complexes;
limitations on transfers of Local Limited Partnership Interests;  limitations on
removal of Local Partners; limitations on subsidy programs; and possible changes
in  applicable  regulations.  The  Housing  Complexes  are or will be subject to
mortgage indebtedness. If a Local Limited Partnership does not make its mortgage
payments,  the lender could foreclose resulting in a loss of the Housing Complex
and low  income  housing  credits.  As a limited  partner  of the Local  Limited
Partnerships,  the  Partnership  will have very  limited  rights with respect to
management of the Local Limited Partnerships, and will rely totally on the Local
General  Partners of the Local Limited  Partnerships for management of the Local
Limited Partnerships. The value of the Partnership's investments will be subject
to changes in national and local  economic  conditions,  including  unemployment
conditions, which could adversely impact vacancy levels, rental payment defaults
and operating expenses.  This, in turn, could substantially increase the risk of
operating  losses for the Housing  Complexes and the  Partnership.  In addition,
each Local Limited  Partnership  is subject to risks  relating to  environmental
hazards  and  natural   disasters  which  might  be  uninsurable.   Because  the
Partnership's  operations  will  depend on these and other  factors  beyond  the
control of the General Partner and the Local General  Partners,  there can be no
assurance that the  anticipated  low income housing credits will be available to
Limited Partners.

In addition,  Limited  Partners are subject to risks in that the rules governing
the low income  housing  credit are  complicated,  and the use of credits can be
limited.  The only  material  benefit from an investment in Units may be the low
income housing credits. There are limits on the transferability of Units, and it
is unlikely that a market for Units will develop.  All management decisions will
be made by the General Partner.

Method of Accounting For Investments in Limited Partnerships

The Partnership  accounts for its investments in limited  partnerships using the
equity method of  accounting,  whereby the  Partnership  adjusts its  investment
balance for its share of the Local Limited  Partnership's  results of operations
and for any distributions received. The accounting policies of the Local Limited
Partnerships are consistent with those of the Partnership. Costs incurred by the
Partnership  in  acquiring  the  investments  are  capitalized  as  part  of the
investment account and are being amortized over 30 years (see Note 2).

Offering Expenses

Offering  expenses consist of underwriting  commissions,  legal fees,  printing,
filing and  recordation  fees,  and other costs  incurred  with selling  limited
partnership  interests in the  Partnership.  The General Partner is obligated to
pay all  offering  and  organization  costs in  excess of 15%  (including  sales
commissions) of the total offering proceeds.  Offering expenses are reflected as
a reduction of partners'  capital and amounted to  $2,366,564  at the end of all
periods presented.

                                       7

<PAGE>
                  WNC CALIFORNIA HOUSING TAX CREDITS III, L.P.
                       (A California Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

                       For the Quarter Ended June 30, 2000
                                   (unaudited)

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, continued

Use of Estimates

The preparation of financial  statements in conformity  with generally  accepted
accounting principles 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 revenues  and expenses  during the  reporting  period.
Actual results could materially differ from those estimates.

Cash and Cash Equivalents

The Partnership considers highly liquid investments with remaining maturities of
three months or less when purchased to be cash equivalents.  The Partnership had
no such equivalents at the end of all periods presented.

Net Loss Per Limited Partner Unit

Net loss per limited  partnership  unit is  calculated  pursuant to Statement of
Financial  Accounting  Standards No. 128,  Earnings Per Share. Net loss per unit
includes no dilution  and is computed  by  dividing  loss  available  to limited
partners by the weighted average number of units outstanding  during the period.
Calculation of diluted net income per unit is not required.

Concentration of Credit Risk

At June 30,  2000,  the  Partnership  maintained  a cash  balance  at a  certain
financial institution in excess of the maximum federally insured amounts.

NOTE 2 - INVESTMENTS IN LIMITED PARTNERSHIPS

As of the periods  presented,  the Partnership had acquired limited  partnership
interests in eighteen Local Limited Partnerships, each of which owns one Housing
Complex  consisting  of an  aggregate of 635  apartment  units.  The  respective
general  partners  of the  Local  Limited  Partnerships  manage  the  day-to-day
operations  of the entities.  Significant  Local  Limited  Partnership  business
decisions require approval from the Partnership.  The Partnership,  as a limited
partner,  is  generally  entitled  to 99%,  as  specified  in the Local  Limited
Partnership agreements,  of the operating profits and losses, taxable income and
losses and tax credits of the Limited Partnerships.

Equity  in  losses  of the  Local  Limited  Partnerships  is  recognized  in the
financial  statements until the related  investment account is reduced to a zero
balance. Losses incurred after the investment account is reduced to zero are not
recognized. If the Local Limited Partnerships report net income in future years,
the  Partnership  will resume applying the equity method only after its share of
such net  income  equals  the share of net  losses  not  recognized  during  the
period(s) the equity method was suspended.

                                       8
<PAGE>
                  WNC CALIFORNIA HOUSING TAX CREDITS III, L.P.
                       (A California Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

                       For the Quarter Ended June 30, 2000
                                   (unaudited)

NOTE 2 - INVESTMENTS IN LIMITED PARTNERSHIP, continued

Following is a summary of the equity method activity of the investments in Local
Limited Partnerships for the periods presented below:
<TABLE>
<CAPTION>

                                                         June 30, 2000                  March 31, 2000
                                                     ----------------------         ------------------------
<S>                                                <C>                            <C>
  Investments per balance sheet,
   beginning of period                             $            8,224,971         $              9,164,197
  Distributions received                                           (5,438)                          (5,909)
  Equity in losses of limited
   partnerships                                                  (218,159)                        (872,853)
  Amortization of paid
   acquisition fees and costs                                     (15,116)                         (60,464)
                                                     ----------------------         ------------------------
  Investments per balance sheet,
   end of period                                   $            7,986,258         $              8,224,971
                                                     ======================         ========================

Selected  financial  information  for the three  months  ended  June 30 from the
unaudited combined financial statements of the limited partnerships in which the
Partnership has invested as follows:
                                                               2000                            1999
                                                     ----------------------         ------------------------

  Total revenue                                    $              787,000         $                745,000
                                                     ----------------------         ------------------------

  Interest expense                                                258,000                          237,000
  Depreciation                                                    292,000                          297,000
  Operating expenses                                              472,000                          450,000
                                                     ----------------------         ------------------------
  Total expenses                                                1,022,000                          984,000
                                                     ----------------------         ------------------------

  Net loss                                         $             (235,000)        $               (239,000)
                                                     ======================         ========================
  Net loss allocable to the
   Partnership                                     $             (232,000)        $               (237,000)
                                                     ======================         ========================
  Net loss recorded by the
   Partnership                                     $             (218,000)        $               (230,000)
                                                     ======================         ========================

</TABLE>

                                       9

<PAGE>
                  WNC CALIFORNIA HOUSING TAX CREDITS III, L.P.
                       (A California Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

                       For the Quarter Ended June 30, 2000
                                   (unaudited)

NOTE 3 - RELATED PARTY TRANSACTIONS

The Partnership has no officers,  employees,  or directors.  However,  under the
terms of the  Partnership  Agreement the Partnership is obligated to the General
Partner or its  affiliates  during the current or future years for the following
fees:

(a)  Annual Asset  Management  Fee. An annual asset  management fee in an amount
     equal  to 0.5% of the  Invested  Assets  of the  Partnership,  as  defined.
     "Invested  Assets" means the sum of the  Partnership's  Investment in Local
     Limited Partnership Interests and the Partnership's  allocable share of the
     amount of the  mortgage  loans on and other  debts  related to, the Housing
     Complexes  owned by such Local  Limited  Partnerships.  Fees of $45,346 and
     $45,346 were incurred during the three months ended June 30, 2000 and 1999,
     respectively. The Partnership paid the General Partner or its affiliates $0
     of those fees during the three months ended June 30, 2000 and 1999.

(b)  A subordinated  disposition fee in an amount equal to 1% of the sales price
     of real estate  sold.  Payment of this fee is  subordinated  to the limited
     partners  receiving a preferred return of 16% through December 31, 2003 and
     6% thereafter (as defined in the Partnership Agreement) and is payable only
     if the  General  Partner or its  affiliates  render  services  in the sales
     effort.

The "accrued fees and expenses due to general partner and affiliates"  presented
on the balance sheets consists of the following:
<TABLE>
<CAPTION>
                                                                June 30, 2000               March 31, 2000
                                                           ----------------------        --------------------
<S>                                                     <C>                           <C>
  Reimbursement for expenses paid by the General
   Partner or an affiliate                              $                      -      $                  500
  Asset management fee payable                                           763,125                     717,779
                                                           ----------------------        --------------------

                                                        $                763,125      $              718,279
                                                           ======================        ====================
</TABLE>

NOTE 4 - INCOME TAXES

No provision for income taxes has been  recorded in the financial  statements as
any  liability  for  income  taxes  is the  obligation  of the  partners  of the
Partnership.

                                       10

<PAGE>
Item 2. Management's  Discussion and Analysis of Financial Condition and Results
of Operations

This  Quarterly  Report  contains  forward-looking   statements  concerning  the
Partnership's anticipated future revenues and earnings,  adequacy of future cash
flow and related matters. These forward-looking  statements include, but are not
limited to, statements containing the words "expect",  "believe", "will", "may",
"should", "project", "estimate", and like expressions, and the negative thereof.
These statements are subject to risks and uncertainties  that could cause actual
results to differ materially from the statements, including competition, as well
as those  risks  described  in the  Partnership's  SEC  reports,  including  the
Partnership's  Form 10-K filed  pursuant to the  Securities  and Exchange Act of
1934 on June 29, 2000.

The following discussion and analysis compares the results of operations for the
fiscal  quarter ended June 30, 2000 and 1999,  and should be read in conjunction
with the condensed  consolidated  financial  statements and  accompanying  notes
included within this report.

Financial Condition

The  Partnership's  assets at June 30, 2000  consisted  primarily of $486,000 in
cash and aggregate  investments  in the eighteen Local Limited  Partnerships  of
$7,986,000.  Liabilities  at June 30, 2000  primarily  consisted  of $763,000 of
accrued annual management fees due to the General Partners.

Results of Operations

Three Months  Ended June 30, 2000  Compared to Three Months Ended June 30, 1999.
The  Partnership's  net loss  for the  three  months  ended  June  30,  2000 was
$(278,000),  reflecting  a decrease of $15,000  from the net loss of  $(293,000)
experienced for the three months ended June 30, 1999. The decline in net loss is
primarily  due to equity in losses of limited  partnerships  which  declined  by
$12,000 to $(218,000)  for the three months ended June 30, 2000 from  $(230,000)
for the three  months  ended June 30,  1999.  This  decrease was a result of the
Partnership  not recognizing  certain losses of the Local Limited  Partnerships.
The  investments in such Local Limited  Partnerships  had reached $0 at June 30,
2000.  Since the  Partnership's  liability  with respect to its  investments  is
limited,  losses in excess of  investment  are not  recognized.  Along  with the
decrease  in equity in losses of limited  partnerships,  there was a decrease in
loss from  operations  of $3,000 for the three  months  ended  June 30,  2000 to
$(60,000),  from  $(63,000)  for the three months ended June 30, 1999,  due to a
comparable decrease in operating expense allocations.

Cash Flows

Three Months  Ended June 30, 2000  Compared to Three Months Ended June 30, 1999.
Net cash  provided  during  the three  months  ended  June 30,  2000 was  $6,000
compared to a net  increase in cash for the three  months ended June 30, 1999 of
$9,000.  The change was due  primarily  to an increase  in expenses  paid to the
General Partner or affiliates of $9,000, offset by a decrease in operating costs
of $3,000 and an increase in distributions from limited partnerships of $1,000.

During the three months ended June 30, 2000,  accrued  payables,  which  consist
primarily of related party management fees due to the General Partner, increased
by $45,000. The General Partner does not anticipate that these accrued fees will
be paid until such time as capital reserves are in excess of future  foreseeable
working capital requirements of the partnership.

The Partnership  expects its future cash flows,  together with its net available
assets at June 30, 2000,  to be  sufficient  to meet all  currently  foreseeable
future cash requirements.

                                       11
<PAGE>
Impact of Year 2000

WNC & Associates, Inc.

Status of Readiness

Information Technology (IT) Systems. The Partnership relies on the IT systems of
WNC, its ultimate  general  partner.  IT systems include  computer  hardware and
software  used to produce  financial  reports and tax return  information.  This
information  is then  used to  generate  reports  to  investors  and  regulatory
agencies, including the Internal Revenue Service and the Securities and Exchange
Commission. The IT systems of WNC are year 2000 compliant.

Non-IT Systems. The Partnership also relies on the non-IT systems of WNC. Non-IT
systems  include  machinery and  equipment  such as  telephones,  voice mail and
electronic postage equipment. The non-IT systems of WNC are year 2000 compliant.

Service  Providers.  WNC also  relies on the IT and  non-IT  systems  of service
providers. Service providers include utility companies,  financial institutions,
telecommunications carriers,  municipalities, and other outside vendors. WNC has
obtained verbal assurances from its material service providers (electrical power
provider,  financial institutions and telecommunications carriers) that their IT
and non-IT systems are year 2000  compliant.  To date,  WNC has not  encountered
significant year 2000 issues or business disruptions from its service providers.

Costs to Address Year 2000 Issues

The cost to address year 2000 issues for WNC has been less than $25,000.

Risk of Year 2000 Issues

Although WNC has  encountered no significant  year 2000 issues to date, the most
reasonable  and likely result from  non-year  2000  compliance of systems of the
service  providers  noted  above  would be the  disruption  of  normal  business
operations for WNC. This disruption could, in turn, lead to delays in performing
reporting and fiduciary responsibilities on behalf of the Partnership. The worst
case scenario would be the replacement of a service provider. These delays would
likely  be  temporary  and  would  likely  not  have a  material  effect  on the
Partnership or WNC.

Local Limited Partnerships

Status of Readiness

To date, WNC and the  Partnership  have  encountered  no  significant  year 2000
issues with respect to the Local Limited Partnerships.

Costs to Address Year 2000 Issues

There has been and will be no cost to the  Partnership  as a result of assessing
year 2000 issues for the Local  Limited  Partnerships.  Although no  significant
year 2000 issues have been  encountered to date, the cost to deal with potential
year 2000 issues of the Local Limited  Partnerships  cannot be estimated at this
time.

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<PAGE>
Risk of Year 2000 Issues

Although no significant  year 2000 issues have been  encountered to date,  there
can be no assurance that the Partnership will be unaffected by year 2000 issues.
The most  reasonable and likely result from non-year 2000 compliance will be the
disruption of normal  business  operations  for the Local Limited  Partnerships,
including but not limited to the possible  failure to properly collect rents and
meet their obligations in a timely manner.  This disruption would, in turn, lead
to  delays  by the  Local  Limited  Partnerships  in  performing  reporting  and
fiduciary responsibilities on behalf of the Partnership. The worst-case scenario
would  include the  initiation  of  foreclosure  proceedings  on the property by
mortgage debt holders.  Under these  circumstances,  WNC or its affiliates  will
take  actions  necessary  to minimize  the risk of  foreclosure,  including  the
removal and  replacement of a Local General  Partner by the  Partnership.  These
delays would likely be temporary and would likely not have a material  effect on
the Partnership or WNC.

Item 3.  Quantitative and Qualitative Disclosures About Market Risks

         NOT APPLICABLE

Part II. Other Information

Item 1.  Legal Proceedings

         NONE

Item 6.  Exhibits and Reports on Form 8-K

         NONE







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<PAGE>

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.

WNC CALIFORNIA HOUSING TAX CREDITS III, L.P.

By:  WNC California Tax Credit Partners III , L.P.
General Partner of the Registrant

By:  WNC & Associates, Inc.
General Partner of WNC California Housing Tax Credits III, L.P.



By: /s/ Will N Cooper, Jr.

Will N Cooper,  Jr.,
President - Chief  Operating  Officer of WNC & Associates, Inc.

Date: August 10, 2000



By:  /s/ Michael L. Dickenson

Michael L. Dickenson,
Vice-President - Chief Financial Officer of WNC & Associates, Inc.

Date: August 10, 2000



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