<PAGE>
Annual Report
as of March 31, 2000
EVERGREEN STATE MUNICIPAL BOND FUNDS
[LOGO OF EVERGREEN FUNDS]
[SEAL]
<PAGE>
Table of Contents
Letter to Shareholders .................................................... 1
Evergreen Connecticut Municipal
Bond Fund
Fund at a Glance ........................................................ 2
Portfolio Manager Interview ............................................. 3
Evergreen New Jersey Municipal
Bond Fund
Fund at a Glance ........................................................ 4
Portfolio Manager Interview ............................................. 5
Evergreen Pennsylvania Municipal
Bond Fund
Fund at a Glance ........................................................ 6
Portfolio Manager Interview ............................................. 7
Financial Highlights
Evergreen Connecticut Municipal
Bond Fund ............................................................... 8
Evergreen New Jersey Municipal
Bond Fund ............................................................... 10
Evergreen Pennsylvania Municipal
Bond Fund ............................................................... 12
Schedule of Investments
Evergreen Connecticut Municipal
Bond Fund ............................................................... 14
Evergreen New Jersey Municipal
Bond Fund ............................................................... 16
Evergreen Pennsylvania Municipal
Bond Fund ............................................................... 20
Statements of Assets and Liabilities ...................................... 28
Statements of Operations .................................................. 29
Statements of Changes in Net Assets ....................................... 30
Combined Notes to Financial
Statements ................................................................ 32
Independent Auditors' Report .............................................. 40
Additional Information .................................................... 41
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Evergreen Funds
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Evergreen Funds is one of the nation's fastest growing investment companies with
approximately $80 billion in assets under management.
With over 80 mutual funds to choose among and acclaimed service and operations
capabilities, investors enjoy a broad range of quality investment products and
services designed to meet their needs.
The Evergreen Funds employ intensive, research-driven investment strategies
executed by over 90 research analysts and portfolio managers. The fund company
remains dedicated to meeting the needs of investors and their advisors in a
global economy. Look to Evergreen Funds to provide a distinctive level of
service and excellence in investment management.
This annual report must be preceded or accompanied by a prospectus of an
Evergreen fund contained herein. The prospectus contains more complete
information, including fees and expenses, and should be read carefully before
investing or sending money.
---------------------------------------------------------------
Mutual Funds: ARE NOT FDIC INSURED May lose value . Not bank guaranteed
---------------------------------------------------------------
Evergreen Distributor,Inc.
Evergreen Funds(SM) is a service mark of Evergreen Investment Services,Inc.
<PAGE>
Letter to Shareholders
----------------------
May 2000
[PHOTO]
William M. Ennis
President and CEO
Dear Evergreen Shareholders,
We are pleased to provide the Evergreen State Municipal Bond Funds annual
report, which covers the twelve-month period ended March 31, 2000.
U.S. Bond Markets Experience Volatility
The bond market environment has suffered a great deal of volatility and
unpredictability for the past twelvemonth period. The Federal Reserve Board
increased interest rates five times during the period as a response to a
potential inflationary environment. In addition, the Treasury's announcement of
a plan to curtail new and existing supplies of long-term government bonds led
investors to seek longer-term issues in anticipation of possible shortages. For
the last half of the period, counteractive forces caused the yield on the
bellwether 30-year Treasury bond to decrease 0.22%, while the 10-Year Treasury
yield increased approximately 0.10%. These factors are indicative of an abnormal
investment environment where longer-term bonds paid lower rates than short-term
bonds, this is also known as an "inverted yield curve". Amidst this volatile
environment, we still believe that bonds are relatively attractive over the long
term.
We believe that sound investing is about taking steps to meet your long-term
financial needs and goals. We remind you to take advantage of your financial
advisor's expertise to develop and refine a financial plan that will enable you
to meet your objectives. Evergreen Funds offers a broad mix of stock, bond and
money market funds that could make it simple for you to choose the most
appropriate for your portfolio.
Website Enhancements
Please visit our enhanced website, evergreen-funds.com, for more information
about Evergreen Funds. The site offers an array of helpful information including
an investment education center, interactive calculators to assist your
investment planning and general information about Evergreen Funds.
Thank you for your continued investment in Evergreen Funds.
Sincerely,
/s/ William M. Ennis
William M. Ennis
President and CEO
Evergreen Investment Company, Inc.
1
<PAGE>
EVERGREEN
Connecticut Municipal Bond Fund
Fund at a Glance as of March 31, 2000
Portfolio
Characteristics
---------------
Total Net Assets $72,509,328
Average Credit Quality AA
Effective Maturity 9.6 years
Average Duration 6.7 years
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CURRENT INVESTMENT STYLE1
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[STYLE BOX]
Morningstar's Style Box is based on a portfolio date as of 3/31/2000.
The Fixed-Income Style Box placement is based on a fund's average effective
maturity or duration and the average credit rating of the bond portfolio.
1 Source: 2000 Morningstar, Inc.
2 Past performance is no guarantee of future results. The investment return and
principal value will fluctuate so that an investor's shares, when redeemed, may
be worth more or less than original cost. The performance of each class may vary
based on differences in loads, fees and expenses paid by the shareholders
investing in each class. Performance includes the reinvestment of income
distributions and capital gain distributions.
Historical performance shown for Class Y prior to its inception is based on the
Fund's predecessor common trust fund's (CTF) performance, adjusted for estimated
mutual fund expenses. The CTF was not registered under the 1940 Act and was not
subject to certain investment restrictions. If the CTF had been registered, its
performance might have been adversely affected. For Classes A and B prior to
their inception, the historical performance is based on the performance of Class
Y and has not been adjusted to reflect the effect of each Class' 12b-1 fees.
These fees are 0.25% for Class A and 1.00% for Class B. If these fees had been
reflected, returns for Classes A and B would have been lower. The advisor is
waiving a portion of its advisory fee. Had the fee not been waived, returns
would have been lower. Performance for the common trust fund has been adjusted
to include the effect of estimated mutual fund classgross expense ratios at the
time the Fund was converted to a mutual fund. If fee waivers and expense
reimbursements had been calculated into the mutual fund class expense ratio, the
total returns would be as follows: Class A - 3 year = 2.24%, 5 year = 3.30%, 10
year = 4.46% and since 1/31/1981 = 6.13%; Class B - 3 year = 2.24%, 5 year =
3.21%, 10 year = 4.19% and since 1/31/1981 = 5.60%; Class Y - 3 year = 4.19%, 5
year = 4.59%, 10 year = 5.23% and since 1/31/1981 = 6.66%.
Funds that concentrate their investments in a single state may face increased
risk of price fluctuation over more diversified funds due to adverse
developments within that state.
Funds that invest in high yield, lower-rated bonds may contain more risks due to
the increased possibility of default.
Income may be subject to federal alternative minimum tax.
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PERFORMANCE AND RETURNS2
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Portfolio Inception Date: 1/31/1981 Class A Class B Class Y
Class Inception Date 12/30/1997 1/9/1998 11/24/1997
Average Annual Returns*
1 year with sales charge -6.17% -6.92% n/a
1 year w/o sales charge -1.47% -2.21% -1.22%
5 years 3.15% 3.06% 4.44%
10 years 4.24% 3.97% 5.01%
Since Portfolio Inception 5.88% 5.35% 6.41%
Maximum Sales Charge 4.75% 5.00% n/a
Front End CDSC
30-day SEC Yield 4.30% 3.77% 4.76%
Taxable Equivalent Yield** 7.12% 6.24% 7.88%
12-month income dividends per share $0.26 $0.22 $0.27
12-month capital gains distributions
per share $0.02 $0.02 $0.02
* Adjusted for maximum applicable sales charge.
** Assumes maximum 39.6% federal tax rate. Results for investors subject to
lower tax rates would not be as advantageous.
The Fund's yield will fluctuate and there can be no guarantee the Fund will
achieve its investment objectives or any particular tax-exempt yield.
All data is as of 3/31/2000 and subject to change.
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LONG TERM GROWTH
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[GRAPH]
Connecticut Municipal Bond A LBMBI CPI
3/31/90 9,525 10,000 10,000
3/31/91 10,329 10,923 10,490
3/31/92 11,041 12,013 10,824
3/31/93 11,851 13,518 11,158
3/31/94 12,003 13,832 11,437
3/31/95 12,512 14,859 11,764
3/31/96 13,389 16,105 12,098
3/31/97 13,773 16,982 12,432
3/31/98 14,907 18,802 12,603
3/31/99 15,699 19,967 12,821
3/31/00 15,470 19,917 13,219
Comparison of a $10,000 investment in Evergreen
Connecticut Municipal Bond Fund, Class A shares(2), versus a similar investment
in the Lehman Brothers Municipal Bond Index (LBMBI) and the Consumer Price Index
(CPI).
The LBMBI is an unmanaged market index and does not include transaction costs
associated with buying and selling securities nor any mutual fund expenses. The
CPI is a commonly used measure of inflation and does not represent an investment
return. It is not possible to invest directly in an index.
2
<PAGE>
EVERGREEN
Connecticut Municipal Bond Fund
Portfolio Manager Interview
Portfolio
Management
------------------
[PHOTO]
Diane Beaver
Tenure: November 1999
For the twelve-month period ended March 31, 2000, the Connecticut Municipal Bond
Fund Class A Shares returned -1.47% compared to the Lehman Brothers Municipal
Bond Index which returned -0.08% for the same period. Performance is before
deduction of any applicable sales charge.
The Fund purchased bonds with higher defensive coupons and increased the coupon
rate by 0.25%. We concentrated on buying bonds in the intermediate range of
10-20 years. We were able to increase the yield in accordance with the new
strategy to focus on yield and a stable net asset value rather than total
return. This helped to align our strategy with the goals of the Fund's investors
who invest mainly for income.
We will continue trying to add yield to the fund, however there is a shortage of
high yielding bond securities in Connecticut. Spreads between AAA/AA high
quality bonds versus A-rated bonds is tight, while spreads between lower-rated
securities and high grades are extremely wide. The Fund continues to be heavily
weighted in AAA bonds.
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PORTFOLIO COMPOSITION
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(as a percentage of 03/31/2000 portfolio assets)
[PIE CHART]
Hospital -- 16.8%
General Obligation-Local --
15.2%
General Obligation-State --
13.5%
Special Tax -- 11.9%
Housing -- 9.1%
Education -- 5.9%
Transportation -- 5.4%
Water & Sewer -- 3.4%
Residential Care -- 3.0%
Other -- 15.8%
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PORTFOLIO QUALITY
- --------------------------------------------------------------------------------
(as a percentage of 03/31/2000 portfolio assets)
[PIE CHART]
AAA -- 49.1%
AA -- 34.4%
A -- 7.0%
BBB -- 7.7%
Not Rated -- 1.8%
3
<PAGE>
EVERGREEN
New Jersey Municipal Bond Fund
Fund at a Glance as of March 31, 2000
Portfolio
Characteristics
---------------
Total Net Assets $216,348,921
Average Credit Quality AA
Effective Maturity 9.1 years
Average Duration 6.2 years
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CURRENT INVESTMENT STYLE1
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[STYLE BOX]
Morningstar's Style Box is based on a portfolio date as of 3/31/2000.
The Fixed-Income Style Box placement is based on a fund's average effective
maturity or duration and the average credit rating of the bond portfolio.
1 Source: 2000 Morningstar, Inc.
2 Past performance is no guarantee of future results. The investment return and
principal value will fluctuate so that an investor's shares, when redeemed, may
be worth more or less than original cost. The performance of each class may vary
based on differences in loads, fees and expenses paid by the shareholders
investing in each class. Performance includes the reinvestment of income
distributions and capital gain distributions.
Historical performance shown for Classes B and Y prior to their inception is
based on the performance of Class A, the original class offered. These
historical returns for Classes B and Y have not been adjusted to reflect the
effect of each Class' 12b-1 fees. These fees are 0.25% for Class A and 1.00% for
Class B. Class Y does not pay a 12b-1 fee. If these fees had been reflected,
returns for Class B would have been lower while returns for Class Y would have
been higher. Returns reflect expense limits previously in effect, without which
returns would have been lower.
Funds that concentrate their investments in a single state may face increased
risk of price fluctuation over more diversified funds due to adverse
developments within that state.
Funds that invest in high yield, lower-rated bonds may contain more risks due to
the increased possibility of default.
Income may be subject to federal alternative minimum tax.
- --------------------------------------------------------------------------------
PERFORMANCE AND RETURNS2
- --------------------------------------------------------------------------------
Portfolio Inception Date: 7/16/1991 Class A Class B Class Y
Class Inception Date 7/16/1991 1/30/1996 2/8/1996
Average Annual Returns*
1 year with sales charge -6.05% -6.91% n/a
1 year w/o sales charge -1.33% -2.21% -1.23%
5 years 4.04% 3.96% 5.13%
Since Portfolio Inception 5.49% 5.64% 6.13%
Maximum Sales Charge 4.75% 5.00% n/a
Front End CDSC
30-day SEC Yield 4.58% 3.90% 4.90%
Taxable Equivalent Yield** 7.58% 6.46% 8.11%
12-month income dividends per share $ 0.51 $ 0.41 $ 0.52
12-month capital gains distributions
per share $ 0.02 $ 0.02 $ 0.02
* Adjusted for maximum applicable sales charge
** Assumes maximum 39.6% federal tax rate. Results for investors subject to
lower tax rates would not be as advantageous.
The Fund's yield will fluctuate and there can be no guarantee the Fund will
achieve its investment objectives or any particular tax-exempt yield. All data
is as of 3/31/2000 and subject to change.
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LONG TERM GROWTH
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[GRAPH]
New Jersey
Municipal Bond A LB Muni CPI
7/16/91 9,525 10,000 10,000
3/31/92 10,074 10,639 10,228
3/31/93 11,414 11,972 10,543
3/31/94 11,659 12,249 10,808
3/31/95 12,444 13,160 11,116
3/31/96 13,346 14,263 11,432
3/31/97 13,972 15,040 11,747
3/31/98 15,279 16,651 11,909
3/31/99 16,146 17,683 12,115
3/31/00 15,930 17,639 12,491
Comparison of a $10,000 investment in Evergreen New Jersey Municipal Bond Fund,
Class A shares(2), versus a similar investment in the Lehman Brothers Municipal
Bond Index (LBMBI) and the Consumer Price Index (CPI).
The LBMBI is an unmanaged market index and does not include transaction costs
associated with buying and selling securities nor any mutual fund expenses. The
CPI is a commonly used measure of inflation and does not represent an investment
return. It is not possible to invest directly in an index.
4
<PAGE>
EVERGREEN
New Jersey Municipal Bond Fund
Portfolio Manager Interview
Portfolio
Management
----------------
Keith Lowe,CFA
Tenure: November 1999
For the one-year period ended March 31, 2000, the New Jersey Municipal Bond Fund
Class A shares returned -1.33% compared with the Lehman Brothers Municipal Bond
Index which returned -0.08% for the same period. Performance is before deduction
of any applicable sales charge.
The Fund continues to perform well in conjunction with its new income-based
strategy, which was implemented in January 1999. Our income approach served the
Fund well over the last twelve months. As interest rates rose significantly, we
were able to reduce our exposure to longer maturity, lower coupon bonds. The
Fund's income also increased significantly over this time period as we increased
yield by buying higher coupon, more defensive structures and selling lower
yielding bonds.
During the year, the Fund shortened its effective maturity to 9.1 years and
lowered its duration to 6.23 years. The Fund also avoided credit risk by
maintaining an average credit quality of AA during this period.
We will attempt to continue increasing the tax-exempt yield provided by the
Fund, while working to maintain competitive total return results for our
shareholders.
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PORTFOLIO COMPOSITION
- --------------------------------------------------------------------------------
(as a percentage of 3/31/2000 portfolio assets)
[PIE CHART]
General Obligation-Local -- 20.2%
Health -- 17.8%
Water & Sewer -- 13.5%
Escrow -- 12.1%
Transportation -- 11.0%
Housing -- 4.9%
Education -- 3.7%
Port Authority -- 3.5%
Airport -- 2.5%
Other -- 10.8%
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PORTFOLIO QUALITY
- --------------------------------------------------------------------------------
(as a percentage of 3/31/2000 portfolio assets)
[PIE CHART]
AAA -- 60.3%
AA -- 22.0%
A -- 6.7%
BBB -- 2.5%
B -- 1.5%
Not Rated -- 7.0%
5
<PAGE>
EVERGREEN
Pennsylvania Municipal Bond Fund
Fund at a Glance as of March 31, 2000
Portfolio
Characteristics
---------------
Total Net Assets $870,432,160
Average Credit Quality AA
Effective Maturity 11.5 years
Average Duration 6.0 years
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CURRENT INVESTMENT STYLE1
- --------------------------------------------------------------------------------
[STYLE BOX]
Morningstar's Style Box is based on a portfolio date as of 3/31/2000.
The Fixed-Income Style Box placement is based on a fund's average effective
maturity or duration and the average credit rating of the bond portfolio.
1 Source: 2000 Morningstar, Inc.
2 Past performance is no guarantee of future results. The investment return and
principal value will fluctuate so that an investor's shares, when redeemed, may
be worth more or less than original cost. The performance of each class may vary
based on differences in loads, fees and expenses paid by the shareholders
investing in each class. Performance includes the reinvestment of income
distributions and capital gain distributions.
Historical performance shown for Classes B, C and Y prior to their inception is
based on the performance of Class A, the original class offered. These
historical returns for Classes B, C and Y have not been adjusted to reflect the
effect of each Class' 12b-1 fees. These fees are 0.25% for Class A and 1.00% for
Classes B and C. Class Y does not pay a 12b-1 fee. If these fees had been
reflected, returns for Classes B and C would have been lower while returns for
Class Y would have been higher. Returns reflect expense limits previously in
effect, without which returns would have been lower.
Funds that concentrate their investments in a single state may face increased
risk of price fluctuation over more diversified funds due to adverse
developments within that state.
Funds that invest in high yield, lower-rated bonds may contain more risks due to
the increased possibility of default.
Income may be subject to federal alternative minimum tax.
- --------------------------------------------------------------------------------
PERFORMANCE AND RETURNS2
- --------------------------------------------------------------------------------
Portfolio Inception Date: 12/27/1990 Class A Class B Class C Class Y
Class Inception Date 12/27/1990 2/1/1993 2/1/1993 11/24/1997
Average Annual Returns*
1 year with sales charge -6.51% -6.92% -4.18% n/a
1 year w/o sales charge -1.86% -2.23% -2.31% -1.62%
5 years 4.21% 4.20% 4.53% 5.35%
Since Portfolio Inception 6.24% 6.23% 6.22% 6.88%
Maximum Sales Charge 4.75% 5.00% 2.00% n/a
Front End CDSC CDSC
30-day SEC Yield 4.87% 4.36% 4.36% 5.36%
Taxable Equivalent Yield ** 8.06% 7.22% 7.22% 8.87%
12-month income dividends
per share $ 0.54 $ 0.46 $ 0.46 $ 0.57
12-month capital gains
distributions per share $ 0.01 $ 0.01 $ 0.01 $ 0.01
* Adjusted for maximum applicable sales charge.
** Assumes maximum 39.6% federal tax rate. Results for investors subject to
lower tax rates would not be as advantageous.
The Fund's yield will fluctuate and there can be no guarantee the Fund will
achieve its investment objectives or any particular tax-exempt yield.
All data is as of 3/31/2000 and subject to change.
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LONG TERM GROWTH
- --------------------------------------------------------------------------------
[GRAPH]
Pennsylvania
Municipal Bond A LBMBI CPI
12/7/90 9,525 10,000 10,000
3/31/91 9,941 10,226 10,090
3/31/92 11,143 11,247 10,411
3/31/93 12,623 12,656 10,732
3/31/94 12,949 12,950 11,001
3/31/95 13,585 13,912 11,315
3/31/96 14,624 15,078 11,637
3/31/97 15,399 15,899 11,958
3/31/98 16,945 17,603 12,123
3/31/99 17,850 18,694 12,332
3/31/00 17,519 18,647 12,715
Comparison of a $10,000 investment in Evergreen Pennsylvania Municipal Bond
Fund, Class A shares(2), versus a similar investment in the Lehman Brothers
Municipal Bond Index (LBMBI) and the Consumer Price Index (CPI).
The LBMBI is an unmanaged market index and does not include transaction costs
associated with buying and selling securities nor any mutual fund expenses. The
CPI is a commonly used measure of inflation and does not represent an investment
return. It is not possible to invest directly in an index.
6
<PAGE>
EVERGREEN
Pennsylvania Municipal Bond Fund
Portfolio Manager Interview
Portfolio
Management
------------------
[PHOTO]
Charles Jeanne, CFA
Tenure: November 1999
For the one-year period ended March 31, 2000, the Pennsylvania Municipal Bond
Fund Class A Shares returned -1.86% compared to the -0.08% return for the Lehman
Brothers Municipal Bond Index for the same period. Performance is before
deduction of any applicable sales charge.
The Fund's investment strategies are centered on maximizing income and yield,
and enhancing price stability. In order to implement these strategies, we
selected securities with both higher coupons and yields, such as housing and
healthcare bonds, focusing on maturities in the 15-20 year range. Tax swaps also
played a key role in bolstering the Fund's yield, as we sold lower yielding
bonds and bought bonds with higher yields.
In anticipation of rising interest rates due to continued economic strength and
tight labor markets, we shortened the duration of the fund in order to reduce
its volatility to rising interest rates early in the period. This was
accomplished by selling longer, higher duration bonds and replacing them with
bonds having a more defensive structure.
During the latter part of the period, we reduced the cash position to around 1%.
This decrease in our cash position was implemented in order take advantage of
favorable interest rates thus maximizing income and yield.
- --------------------------------------------------------------------------------
PORTFOLIO COMPOSITION
- --------------------------------------------------------------------------------
(as a percentage of 3/31/2000 portfolio assets)
[PIE CHART]
Prerefunded/Escrowed -- 20.6%
Health Care -- 18.6%
Education -- 12.6%
General Obligation -- 11.6%
Water & Sewer -- 6.7%
Housing -- 4.4%
Industrial Development -- 4.1%
Transportation -- 2.4%
Residential Care -- 2.3%
Airport -- 1.6%
Other -- 15.1%
- --------------------------------------------------------------------------------
PORTFOLIO QUALITY
- --------------------------------------------------------------------------------
(as a percentage of 3/31/2000 portfolio assets)
[PIE CHART]
AAA -- 59.8%
AA -- 20.6%
A -- 6.6%
BBB -- 7.6%
Not Rated -- 5.4%
7
<PAGE>
EVERGREEN
Connecticut Municipal Bond Fund
Financial Highlights
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Year Ended March 31,
-------------------------
2000 1999 1998 (a)
<S> <C> <C> <C>
CLASS A SHARES
Net asset value, beginning of period $ 6.38 $ 6.38 $ 6.40
------ ------ ------
Income from investment operations
Net investment income 0.26 0.26 0.07
Net realized and unrealized gains or losses on
securities (0.35) 0.06 (0.02)
------ ------ ------
Total from investment operations (0.09) 0.32 0.05
------ ------ ------
Less distributions to shareholders from
Net investment income (0.26) (0.26) (0.07)
Net realized gains (0.02) (0.06) 0
------ ------ ------
Total distributions to shareholders (0.28) (0.32) (0.07)
------ ------ ------
Net asset value, end of period $ 6.01 $ 6.38 $ 6.38
------ ------ ------
Total return* (1.47%) 5.14% 0.77%
Ratios and supplemental data
Net assets, end of period (thousands) $ 744 $ 570 $ 146
Ratios to average net assets
Expenses++ 0.86% 0.84% 0.86%+
Net investment income 4.25% 4.04% 4.38%+
Portfolio turnover rate 86% 42% 17%
</TABLE>
<TABLE>
<CAPTION>
Year Ended March 31,
-------------------------
2000 1999 1998 (b)
<S> <C> <C> <C>
CLASS B SHARES
Net asset value, beginning of period $ 6.38 $ 6.38 $ 6.44
------ ------ ------
Income from investment operations
Net investment income 0.22 0.21 0.05
Net realized and unrealized gains or losses on
securities (0.35) 0.06 (0.06)
------ ------ ------
Total from investment operations (0.13) 0.27 (0.01)
------ ------ ------
Less distributions to shareholders from
Net investment income (0.22) (0.21) (0.05)
Net realized gains (0.02) (0.06) 0
------ ------ ------
Total distributions to shareholders (0.24) (0.27) (0.05)
------ ------ ------
Net asset value, end of period $ 6.01 $ 6.38 $ 6.38
------ ------ ------
Total return* (2.21%) 4.35% (0.21%)
Ratios and supplemental data
Net assets, end of period (thousands) $1,375 $1,180 $ 331
Ratios to average net assets
Expenses++ 1.61% 1.58% 1.61%+
Net investment income 3.45% 3.25% 3.36%+
Portfolio turnover rate 86% 42% 17%
</TABLE>
(a) For the period from December 30, 1997 (commencement of class operations) to
March 31, 1998.
(b) For the period from January 9, 1998 (commencement of class operations) to
March 31, 1998.
* Excluding applicable sales charges.
++ The ratio of expenses to average net assets excludes expense reductions and
includes fee waivers.
+ Annualized.
See Combined Notes to Financial Statements.
8
<PAGE>
EVERGREEN
Connecticut Municipal Bond Fund
Financial Highlights
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Year Ended March 31,
--------------------------
2000 1999 1998(a)
<S> <C> <C> <C>
CLASS Y SHARES
Net asset value, beginning of period $ 6.38 $ 6.37 $ 6.32
------- ------- -------
Income from investment operations
Net investment income 0.27 0.28 0.10
Net realized and unrealized gains or losses on
securities (0.35) 0.07 0.05
------- ------- -------
Total from investment operations (0.08) 0.35 0.15
------- ------- -------
Less distributions to shareholders from
Net investment income (0.27) (0.28) (0.10)
Net realized gains (0.02) (0.06) 0
------- ------- -------
Total distributions to shareholders (0.29) (0.34) (0.10)
------- ------- -------
Net asset value, end of period $ 6.01 $ 6.38 $ 6.37
------- ------- -------
Total return (1.22%) 5.56% 2.39%
Ratios and supplemental data
Net assets, end of period (thousands) $70,390 $73,890 $67,675
Ratios to average net assets
Expenses++ 0.61% 0.58% 0.61%+
Net investment income 4.47% 4.33% 4.50%+
Portfolio turnover rate 86% 42% 17%
</TABLE>
(a) For the period from November 24, 1997 (commencement of class operations) to
March 31, 1998.
++ The ratio of expenses to average net assets excludes expense reductions and
includes fee waivers.
+ Annualized.
See Combined Notes to Financial Statements.
9
<PAGE>
EVERGREEN
New Jersey Municipal Bond Fund
Financial Highlights
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Year Ended March 31,
------------------------------------ Period Ended Year Ended
2000 1999 1998 1997 (a) August 31, 1996 (b) February 29, 1996
<S> <C> <C> <C> <C> <C> <C>
CLASS A SHARES
Net asset value,
beginning of period $ 11.16 $ 11.11 $ 10.74 $ 10.75 $ 11.01 $ 10.53
------- ------- ------- ------- ------- -------
Income from investment
operations
Net investment income 0.51 0.51 0.53 0.31 0.28 0.56
Net realized and
unrealized gains or
losses on securities (0.66) 0.11 0.46 (0.01) (0.26) 0.48
------- ------- ------- ------- ------- -------
Total from investment
operations (0.15) 0.62 0.99 0.30 0.02 1.04
------- ------- ------- ------- ------- -------
Less distributions to
shareholders from
Net investment income (0.51) (0.51) (0.53) (0.31) (0.28) (0.56)
Net realized gains (0.02) (0.06) (0.09) 0 0 0
------- ------- ------- ------- ------- -------
Total distributions to
shareholders (0.53) (0.57) (0.62) (0.31) (0.28) (0.56)
------- ------- ------- ------- ------- -------
Net asset value, end of
period $ 10.48 $ 11.16 $ 11.11 $ 10.74 $ 10.75 $ 11.01
------- ------- ------- ------- ------- -------
Total return* (1.33%) 5.66% 9.34% 2.83% 0.19% 10.08%
Ratios and supplemental
data
Net assets, end of
period (thousands) $28,135 $33,657 $31,614 $31,434 $32,377 $41,762
Ratios to average net
assets
Expenses++ 0.56% 0.50% 0.50% 0.44%+ 0.34%+ 0.36%
Net investment income 4.72% 4.52% 4.77% 5.02%+ 5.08%+ 5.15%
Portfolio turnover rate 55% 40% 37% 15% 0% 4%
<CAPTION>
Year Ended March 31,
------------------------------------ Period Ended Period Ended
2000 1999 1998 1997 (a) August 31, 1996 (b) February 29, 1996 (c)
<S> <C> <C> <C> <C> <C> <C>
CLASS B SHARES
Net asset value,
beginning of period $ 11.16 $ 11.11 $ 10.74 $ 10.75 $ 11.01 $ 11.08
------- ------- ------- ------- ------- -------
Income from investment
operations
Net investment income 0.41 0.40 0.43 0.25 0.24 0.05
Net realized and
unrealized gains or
losses on securities (0.66) 0.11 0.46 0 (0.26) (0.07)
------- ------- ------- ------- ------- -------
Total from investment
operations (0.25) 0.51 0.89 0.25 (0.02) (0.02)
------- ------- ------- ------- ------- -------
Less distributions to
shareholders from
Net investment income (0.41) (0.40) (0.43) (0.26) (0.24) (0.05)
Net realized gains (0.02) (0.06) (0.09) 0 0 0
------- ------- ------- ------- ------- -------
Total distributions to
shareholders (0.43) (0.46) (0.52) (0.26) (0.24) (0.05)
------- ------- ------- ------- ------- -------
Net asset value, end of
period $ 10.48 $ 11.16 $ 11.11 $ 10.74 $ 10.75 $ 11.01
------- ------- ------- ------- ------- -------
Total return* (2.21%) 4.71% 8.35% 2.29% (0.20%) (0.22%)
Ratios and supplemental
data
Net assets, end of
period (thousands) $19,582 $20,199 $13,645 $ 7,847 $ 2,709 $ 186
Ratios to average net
assets
Expenses++ 1.47% 1.41% 1.41% 1.36%+ 1.28%+ 0.31%+
Net investment income 3.81% 3.59% 3.85% 4.07%+ 4.14%+ 5.23%+
Portfolio turnover rate 55% 40% 37% 15% 0% 4%
</TABLE>
(a) For the seven months ended March 31, 1997. The Fund changed its fiscal year
end from August 31 to March 31, effective March 31, 1997.
(b) For the six months ended August 31, 1996. The Fund changed its fiscal year
end from February 28 to August 31, effective August 31, 1996.
(c) For the period from January 30, 1996 (commencement of class operations) to
February 29, 1996.
* Excluding applicable sales charges.
++ The ratio of expenses to average net assets excludes expense reductions and
includes fee waivers.
+ Annualized.
See Combined Notes to Financial Statements.
10
<PAGE>
EVERGREEN
New Jersey Municipal Bond Fund
Financial Highlights
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Year Ended March 31,
--------------------------------------- Period Ended Period Ended
2000 1999 1998 1997 (a) August 31, 1996 (b) February 29, 1996 (c)
<S> <C> <C> <C> <C> <C> <C>
CLASS Y SHARES
Net asset value,
beginning of period $ 11.16 $ 11.11 $ 10.74 $10.75 $11.01 $11.14
-------- -------- -------- ------ ------ ------
Income from investment
operations
Net investment income 0.52 0.52 0.54 0.32 0.28 0.03
Net realized and
unrealized gains or
losses on securities (0.66) 0.11 0.46 (0.01) (0.26) (0.13)
-------- -------- -------- ------ ------ ------
Total from investment
operations (0.14) 0.63 1.00 0.31 0.02 (0.10)
-------- -------- -------- ------ ------ ------
Less distributions to
shareholders from
Net investment income (0.52) (0.52) (0.54) (0.32) (0.28) (0.03)
Net realized gains (0.02) (0.06) (0.09) 0 0 0
-------- -------- -------- ------ ------ ------
Total distributions to
shareholders (0.54) (0.58) (0.63) (0.32) (0.28) (0.03)
-------- -------- -------- ------ ------ ------
Net asset value, end of
period $ 10.48 $ 11.16 $ 11.11 $10.74 $10.75 $11.01
-------- -------- -------- ------ ------ ------
Total return (1.23%) 5.76% 9.44% 2.88% 0.20% (0.87%)
Ratios and supplemental
data
Net assets, end of
period (thousands) $168,632 $123,419 $105,331 $9,436 $9,076 $ 18
Ratios to average net
assets
Expenses++ 0.47% 0.41% 0.41% 0.36%+ 0.31%+ 0.31%+
Net investment income 4.83% 4.61% 4.79% 5.08%+ 5.12%+ 5.28%+
Portfolio turnover rate 55% 40% 37% 15% 0% 4%
</TABLE>
(a) For the seven months ended March 31, 1997. The Fund changed its fiscal year
end from August 31 to March 31, effective March 31, 1997.
(b) For the six months ended August 31, 1996. The Fund changed its fiscal year
end from February 28 to August 31, effective August 31, 1996.
(c) For the period from February 8, 1996 (commencement of class operations) to
February 29, 1996.
++ The ratio of expenses to average net assets excludes expense reductions and
includes fee waivers.
+ Annualized.
See Combined Notes to Financial Statements.
11
<PAGE>
EVERGREEN
Pennsylvania Municipal Bond Fund
Financial Highlights
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Year Ended March 31,
--------------------------------------------
2000 1999 1998 1997 1996
<S> <C> <C> <C> <C> <C>
CLASS A SHARES
Net asset value, beginning of
period $ 11.66 $ 11.70 $ 11.14 $ 11.15 $ 10.91
------- ------- ------- ------- -------
Income from investment
operations
Net investment income 0.54 0.51 0.55 0.59 0.60
Net realized and unrealized
gains or losses on securities (0.76) 0.10 0.55 (0.01) 0.23
------- ------- ------- ------- -------
Total from investment
operations (0.22) 0.61 1.10 0.58 0.83
------- ------- ------- ------- -------
Less distributions to
shareholders from
Net investment income (0.54) (0.51) (0.54) (0.59) (0.59)
Net realized gains (0.01) (0.14) 0 0 0
------- ------- ------- ------- -------
Total distributions to
shareholders (0.55) (0.65) (0.54) (0.59) (0.59)
------- ------- ------- ------- -------
Net asset value, end of period $ 10.89 $ 11.66 $ 11.70 $ 11.14 $ 11.15
------- ------- ------- ------- -------
Total return* (1.86%) 5.36% 10.02% 5.30% 7.66%
Ratios and supplemental data
Net assets, end of period
(thousands) $32,796 $28,646 $24,119 $24,535 $28,710
Ratios to average net assets
Expenses++ 0.73% 0.82% 0.76% 0.76% 0.76%
Net investment income 4.89% 4.36% 4.79% 5.26% 5.29%
Portfolio turnover rate 28% 69% 54% 84% 55%
</TABLE>
<TABLE>
<CAPTION>
Year Ended March 31,
--------------------------------------------
2000 1999 1998 1997 1996
<S> <C> <C> <C> <C> <C>
CLASS B SHARES
Net asset value, beginning of
period $ 11.52 $ 11.55 $ 10.99 $ 11.00 $ 10.81
------- ------- ------- ------- -------
Income from investment
operations
Net investment income 0.45 0.42 0.46 0.49 0.51
Net realized and unrealized
gains or losses on securities (0.70) 0.11 0.54 (0.01) 0.22
------- ------- ------- ------- -------
Total from investment
operations (0.25) 0.53 1.00 0.48 0.73
------- ------- ------- ------- -------
Less distributions to
shareholders from
Net investment income (0.46) (0.42) (0.44) (0.49) (0.54)
Net realized gains (0.01) (0.14) 0 0 0
------- ------- ------- ------- -------
Total distributions to
shareholders (0.47) (0.56) (0.44) (0.49) (0.54)
------- ------- ------- ------- -------
Net asset value, end of period $ 10.80 $ 11.52 $ 11.55 $ 10.99 $ 11.00
------- ------- ------- ------- -------
Total return* (2.23%) 4.68% 9.27% 4.50% 6.84%
Ratios and supplemental data
Net assets, end of period
(thousands) $35,334 $37,823 $37,036 $37,215 $37,719
Ratios to average net assets
Expenses++ 1.48% 1.58% 1.52% 1.51% 1.48%
Net investment income 4.11% 3.60% 4.04% 4.50% 4.55%
Portfolio turnover rate 28% 69% 54% 84% 55%
</TABLE>
* Excluding applicable sales charges.
++ The ratio of expenses to average net assets excludes expense reductions and
includes fee waivers.
See Combined Notes to Financial Statements.
12
<PAGE>
EVERGREEN
Pennsylvania Municipal Bond Fund
Financial Highlights
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Year Ended March 31,
---------------------------------------
2000 1999 1998 1997 1996
<S> <C> <C> <C> <C> <C>
CLASS C SHARES
Net asset value, beginning of period $11.55 $11.59 $11.02 $11.03 $10.83
------ ------ ------ ------ ------
Income from investment operations
Net investment income 0.45 0.42 0.45 0.47 0.51
Net realized and unrealized gains or
losses on securities (0.71) 0.10 0.57 0.01 0.23
------ ------ ------ ------ ------
Total from investment operations (0.26) 0.52 1.02 0.48 0.74
------ ------ ------ ------ ------
Less distributions to shareholders
from
Net investment income (0.46) (0.42) (0.45) (0.49) (0.54)
Net realized gains (0.01) (0.14) 0 0 0
------ ------ ------ ------ ------
Total distributions to shareholders (0.47) (0.56) (0.45) (0.49) (0.54)
------ ------ ------ ------ ------
Net asset value, end of period $10.82 $11.55 $11.59 $11.02 $11.03
------ ------ ------ ------ ------
Total return* (2.31%) 4.59% 9.34% 4.49% 6.92%
Ratios and supplemental data
Net assets, end of period
(thousands) $5,726 $6,945 $6,414 $6,830 $9,675
Ratios to average net assets
Expenses++ 1.48% 1.58% 1.52% 1.51% 1.48%
Net investment income 4.11% 3.60% 4.05% 4.52% 4.57%
Portfolio turnover rate 28% 69% 54% 84% 55%
</TABLE>
<TABLE>
<CAPTION>
Year Ended March 31,
-----------------------------
2000 1999 1998 (a)
<S> <C> <C> <C>
CLASS Y SHARES
Net asset value, beginning of period $ 11.66 $ 11.70 $ 11.60
-------- -------- --------
Income from investment operations
Net investment income 0.57 0.54 0.19
Net realized and unrealized gains or losses
on securities (0.76) 0.10 0.10
-------- -------- --------
Total from investment operations (0.19) 0.64 0.29
-------- -------- --------
Less distributions to shareholders from
Net investment income (0.57) (0.54) (0.19)
Net realized gains (0.01) (0.14) 0
-------- -------- --------
Total distributions to shareholders (0.58) (0.68) (0.19)
-------- -------- --------
Net asset value, end of period $ 10.89 $ 11.66 $ 11.70
-------- -------- --------
Total return (1.62%) 5.63% 2.54%
Ratios and supplemental data
Net assets, end of period (thousands) $796,576 $181,919 $152,960
Ratios to average net assets
Expenses++ 0.47% 0.57% 0.59%+
Net investment income 5.20% 4.61% 4.75%+
Portfolio turnover rate 28% 69% 54%
</TABLE>
(a) For the period from November 24, 1997 (commencement of class operations) to
March 31, 1998.
* Excluding applicable sales charges.
++ The ratio of expenses to average net assets excludes expense reductions and
includes fee waivers.
+ Annualized.
See Combined Notes to Financial Statements.
13
<PAGE>
EVERGREEN
Connecticut Municipal Bond Fund
Schedule of Investments
March 31, 2000
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
MUNICIPAL OBLIGATIONS - 96.4%
Connecticut - 83.2%
Bristol, CT GO:
$ 130,000 5.00%, 6/15/2005...................................... $ 131,235
355,000 5.25%, 6/15/2008...................................... 362,565
Cheshire, CT GO:
660,000 5.375%, 10/15/2013.................................... 667,056
275,000 5.75%, 8/15/2009...................................... 285,359
4,250,000 Connecticut Arpt. RB,
7.65%, 10/1/2012...................................... 4,706,067
2,000,000 Connecticut Dev. Auth. PCRB, United Illuminating,
4.35%, 6/1/2026....................................... 1,901,840
Connecticut Dev. Auth. RB:
2,000,000 Church Homes, Inc. Proj.,
5.80%, 4/1/2021....................................... 1,683,040
Mary Wade Home, Ser. A:
200,000 5.60%, 12/1/2007...................................... 192,368
100,000 5.70%, 12/1/2008...................................... 95,811
1,000,000 6.375%, 12/1/2018..................................... 972,080
890,000 Connecticut Dev. Auth. Spl. Obl. RB, State General
Fund, Ser. A, (Insd. by FGIC),
5.50%, 5/1/2008....................................... 919,851
1,000,000 Connecticut Dev. Auth., Wtr. Facs. RB, Bridgeport
Hydraulic Corp.,
6.15%, 4/1/2035....................................... 987,820
Connecticut GO
Ser. A:
2,000,000 5.60%, 11/15/2009..................................... 2,061,020
1,000,000 6.00%, 3/1/2006....................................... 1,057,960
3,000,000 6.25%, 5/15/2006...................................... 3,218,340
500,000 Ser. B,
6.00%, 11/15/2002..................................... 517,200
200,000 Ser. C,
5.875%, 8/15/2009..................................... 209,840
Connecticut HFA RB, Mtge. Fin. Program:
275,000 Ser. A-2, 5.40%, 5/15/2002............................ 276,832
100,000 Ser. C-1, 5.75%, 5/15/2005............................ 101,452
550,000 Ser. D-1, 5.75%, 11/15/2017........................... 539,225
1,300,000 Ser. E-1, 5.90%, 5/15/2019............................ 1,309,217
2,000,000 Ser. H-1, 5.10%, 5/15/2017............................ 1,816,840
Connecticut Higher Ed. Loan Auth. RB, Ser. A:
295,000 7.00%, 11/15/2000..................................... 298,493
1,205,000 Family Ed. Loan Program,
5.375%, 11/15/2008.................................... 1,192,251
Connecticut Hlth. & Edl. Facs. RB:
225,000 Choate Rosemary Hall, Ser. A, (Insd. by MBIA),
6.50%, 7/1/2009....................................... 240,829
2,000,000 Eastern CT Hlth. Network, Ser. A, 6.375%, 7/1/2016.... 2,112,460
500,000 Greenwich Hosp. Assn., Ser. A, 5.40%, 7/1/2009........ 511,310
500,000 Hebrew Home & Hosp., Ser. B, 5.15%, 8/1/2028.......... 447,755
2,000,000 Hosp. for Spl. Care, Ser. B,
5.125%, 7/1/2007...................................... 1,886,140
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
MUNICIPAL OBLIGATIONS - continued
Connecticut - continued
Connecticut Hlth. & Edl. Facs.
RB: - continued
$1,000,000 Hosp. of St. Raphael, Ser. H, (Insd. by AMBAC),
5.00%, 7/1/2006..................................... $ 1,003,120
1,000,000 Kent Sch. Corp., Ser. B,
5.50%, 7/1/2015..................................... 1,004,060
625,000 Lawrence & Mem. Hosp., Ser. D, 4.875%, 7/1/2007..... 612,075
250,000 New Britain Gen. Hosp., Ser. B, (Insd. by AMBAC),
5.875%, 7/1/2008.................................... 259,422
Newington Children's Hosp., Ser. B, (Insd. by MBIA):
1,000,000 5.90%, 7/1/2008..................................... 1,039,010
250,000 6.05%, 7/1/2010..................................... 260,785
1,000,000 Stamford Hosp., Ser. F,
5.25%, 7/1/2011..................................... 1,001,240
100,000 Trinity College, Ser. F, (Insd. by MBIA), 5.00%,
7/1/2015............................................ 94,579
1,000,000 Veterans Mem. Med. Ctr., Ser. A, 5.375%, 7/1/2014... 996,460
1,500,000 Westminster Sch., Ser. A,
5.50%, 7/1/2016..................................... 1,499,865
1,000,000 Yale New Haven Hosp., Ser. H, 5.625%, 7/1/2016...... 1,007,450
Connecticut Spl. Tax Obl. RB, Trans. Infrastructure:
1,000,000 Ser. A, (Insd. by FGIC),
6.00%, 6/1/2006..................................... 1,056,770
3,905,000 Ser. B,
6.50%, 10/1/2010.................................... 4,345,250
3,800,000 Ser. C,
6.00%, 10/1/2008.................................... 4,057,830
525,000 Guilford, CT GO,
5.00%, 11/15/2007................................... 527,121
Hamdem, CT GO, (Insd. by MBIA):
1,000,000 5.375%, 8/15/2010................................... 1,024,650
1,275,000 5.40%, 8/15/2011.................................... 1,303,330
Middletown, CT GO:
445,000 5.60%, 4/15/2000.................................... 445,262
1,000,000 6.00%, 4/15/2007.................................... 1,061,740
500,000 Milford, CT GO,
5.20%, 1/15/2013.................................... 500,420
300,000 Montville, CT GO,
5.25%, 12/1/2008.................................... 306,048
250,000 Naugatuck, CT GO,
5.40%, 3/15/2008.................................... 256,655
New Britain, CT GO, Ser. A:
370,000 5.10%, 4/1/2011..................................... 370,000
370,000 5.15%, 4/1/2012..................................... 369,083
370,000 5.20%, 4/1/2013..................................... 368,135
500,000 New Haven, CT GO, (Insd. by FSA),
6.50%, 8/1/2000..................................... 503,850
385,000 Putnam, CT GO, (Insd. by MBIA),
5.60%, 11/15/2000................................... 388,723
2,500,000 Stamford, CT Hsg. Auth. MHRB, Fairfield Apts Proj.,
4.75%, 12/1/2028.................................... 2,244,025
</TABLE>
14
<PAGE>
EVERGREEN
Connecticut Municipal Bond Fund
Schedule of Investments(continued)
March 31, 2000
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
MUNICIPAL OBLIGATIONS - continued
Connecticut - continued
Wallingford, CT GO:
$ 170,000 5.50%, 6/15/2008.................................... $ 176,462
170,000 5.60%, 6/15/2009.................................... 177,478
Waterbury, CT GO:
645,000 6.00%, 2/1/2012..................................... 673,167
680,000 6.00%, 2/1/2013..................................... 705,500
-----------
60,341,821
-----------
Guam - 0.4%
250,000 Guam Pwr. Auth. RB, Ser. A,
(Insd. by AMBAC),
5.90%, 10/1/2008.................................... 267,255
-----------
Puerto Rico - 12.8%
1,000,000 Cmnwlth. of Puerto Rico Aqueduct & Swr. Auth. RB,
(Insd. by MBIA),
5.20%, 7/1/2008..................................... 1,021,440
Cmnwlth. of Puerto Rico Hwy. & Trans. Auth. RB:
2,100,000 Ser. A,
5.50%, 7/1/2011..................................... 2,189,334
1,425,000 Ser. Y,
(Insd. by MBIA),
6.25%, 7/1/2014..................................... 1,577,176
1,000,000 Cmnwlth. of Puerto Rico Pub. Bldg. Auth. RB, Pub. Ed.
& Hlth. Facs.,
Ser. M, (Insd. by AMBAC),
5.70%, 7/1/2009..................................... 1,057,320
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
MUNICIPAL OBLIGATIONS - continued
Puerto Rico - continued
Cmnwlth. of Puerto Rico, GO:
$ 205,000 5.50%, 7/1/2008..................................... $ 213,530
2,000,000 6.50%, 7/1/2014..................................... 2,265,700
1,000,000 Pub. Impt.,
5.375%, 7/1/2025.................................... 942,660
-----------
9,267,160
-----------
Total Municipal Obligations
(cost $70,189,014).................................. 69,876,236
-----------
<CAPTION>
Shares
<C> <S> <C>
MUTUAL FUND SHARES - 3.7%
2,728,000 Federated Municipal Obligations Fund (cost
$2,728,000)......................................... 2,728,000
-----------
</TABLE>
<TABLE>
<C> <S> <C> <C>
Total Investments -
(cost $72,917,014)........................... 100.1% 72,604,236
Other Assets and Liabilities - net............ (0.1) (94,908)
----- -----------
Net Assets ................................... 100.0% $72,509,328
===== ===========
</TABLE>
See Combined Notes to Schedules of Investments.
15
<PAGE>
EVERGREEN
New Jersey Municipal Bond Fund
Schedule of Investments
March 31, 2000
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
MUNICIPAL OBLIGATIONS - 92.1%
Delaware - 0.4%
$1,000,000 Delaware River & Bay Auth. RB, (Insd. by FGIC),
5.40%, 1/1/2016...................................... $ 990,500
-----------
New Jersey - 79.8%
300,000 Atlantic Cnty., NJ GO, Spl. Svcs. Vocational Sch.,
(Insd. by MBIA),
5.70%, 8/1/2006...................................... 312,081
150,000 Bayonne, NJ GO, (Insd. by FGIC),
5.90%, 5/1/2008...................................... 157,469
Bergen Cnty., NJ GO:
1,000,000 5.25%, 10/1/2010..................................... 1,013,600
200,000 6.25%, 11/15/2000.................................... 202,720
Bergen Cnty., NJ Util. Auth. & Wtr. PCRB, (Insd. by
FGIC):
1,000,000 Ser. A,
5.50%, 12/15/2006.................................... 1,031,560
500,000 Ser. B,
5.625%, 12/15/2004................................... 516,940
160,000 Branchburg Township, NJ GO,
6.45%, 8/1/2005...................................... 170,499
500,000 Brick Township, NJ Muni. Util. Auth. RB, (Insd. by
FGIC),
5.00%, 12/1/2016..................................... 469,790
400,000 Bridgewater Township, NJ GO,
6.40%, 7/15/2001..................................... 410,056
500,000 Brigantine, NJ GO, (Insd. by MBIA),
6.35%, 8/1/2004...................................... 520,675
Burlington Cnty., NJ Bridge Commission Sys. RB:
1,000,000 5.20%, 10/1/2006..................................... 1,011,180
500,000 5.30%, 10/1/2013..................................... 500,635
Camden Cnty., NJ Impt. Auth. Lease RB:
500,000 5.60%, 12/1/2004..................................... 514,675
500,000 5.625%, 10/1/2015.................................... 504,105
1,705,000 Camden Cnty., NJ Muni. Util. Auth., Swr. RB, (Insd.
by FGIC),
5.20%, 7/15/2014..................................... 1,664,233
500,000 Cape May Cnty., NJ GO, (Insd. by AMBAC),
5.85%, 4/15/2002..................................... 511,905
500,000 Cape May Cnty., NJ Muni. Util. Auth., Swr. RB, Ser.
A, (Insd. by MBIA), 5.75%, 1/1/2016.................. 505,740
Cherry Hill Township, NJ GO:
50,000 5.90%, 6/1/2005...................................... 52,063
500,000 6.00%, 6/1/2006...................................... 521,508
250,000 Eatontown, NJ GO,
6.70%, 10/1/2004..................................... 267,353
500,000 Essex Cnty., NJ Impt. Auth. GO, East Orange Sch.
Dist., Ser. A,
5.80%, 11/1/2007..................................... 521,760
3,090,000 Essex Cnty., NJ Impt. Auth. Lease RB, Cnty.
Correctional Facs. Proj., (Insd. by FGIC),
5.75%, 10/1/2012..................................... 3,226,176
325,000 Essex Cnty., NJ Impt. Auth. RB, (Insd. by AMBAC),
6.65%, 12/1/2000..................................... 330,411
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
MUNICIPAL OBLIGATIONS - continued
New Jersey - continued
Essex Cnty., NJ Util. Auth. Solid Wst. RB, Ser. A,
(Insd. by FSA):
$ 250,000 5.50%, 4/1/2011...................................... $ 261,190
250,000 5.60%, 4/1/2016...................................... 262,475
1,000,000 Fair Lawn, NJ GO, (Insd. by FGIC),
4.70%, 8/1/2010...................................... 962,050
50,000 Flemington Raritan, NJ Sch. Dist. GO,
5.70%, 5/1/2006...................................... 52,473
Franklin Township, NJ GO:
1,355,000 5.60%, 11/1/2005..................................... 1,394,580
160,000 5.90%, 11/1/2008..................................... 166,822
500,000 Franklin Township, Somerset Cnty., NJ Sch. Dist. GO,
6.20%, 4/1/2005...................................... 529,970
1,455,000 Freehold Township, NJ Board of Ed. GO, (Insd. by FSA),
5.40%, 7/15/2024..................................... 1,397,848
Freehold, NJ Regl. High Sch. GO, (Insd. by FGIC):
1,630,000 5.60%, 3/1/2012...................................... 1,685,045
1,065,000 5.60%, 3/1/2013...................................... 1,094,969
Gloucester Cnty., NJ GO, (Insd. by MBIA):
300,000 6.25%, 2/1/2006...................................... 313,725
500,000 6.25%, 2/1/2008...................................... 522,875
500,000 Gloucester Cnty., NJ Util. Auth. RB,
6.50%, 1/1/2021...................................... 513,285
Gloucester Township, NJ GO, (Insd. by AMBAC):
500,000 5.45%, 7/15/2007..................................... 515,720
500,000 6.375%, 9/15/2004.................................... 517,320
1,000,000 Gloucester Township, NJ Muni. Util. Auth. RB, (Insd.
by AMBAC),
5.55%, 3/1/2009...................................... 1,033,320
1,000,000 Hamilton Township, Atlantic Cnty., NJ Sch. Dist. GO,
(Insd. by FGIC),
5.875%, 12/15/2006................................... 1,040,870
500,000 Hunterdon Cnty., NJ GO,
5.50%, 12/1/2002..................................... 512,275
1,000,000 Hunterdon, NJ Central Regl. High Sch. Dist. GO, (Insd.
by FSA),
5.65%, 5/1/2014...................................... 1,021,220
250,000 Jersey City, NJ GO, Ser. A, (Insd. by AMBAC),
5.30%, 10/1/2009..................................... 253,655
225,000 Kearny, NJ GO, (Insd. by FSA),
6.30%, 2/1/2002...................................... 231,777
400,000 Lakewood Township, NJ Sch. Dist. GO, (Insd. by AMBAC),
6.25%, 2/15/2012..................................... 437,944
Mercer Cnty., NJ Impt. Auth. RB:
900,000 Governmental Leasing,
5.40%, 12/1/2005..................................... 918,504
Spl. Svcs. Sch. Dist., Ser. A:
500,000 5.40%, 12/15/2003.................................... 511,225
500,000 5.95%, 12/15/2012.................................... 536,335
1,150,000 Middlesex Cnty., NJ Util. Auth., Swr. RB, Ser. A,
(Insd. by FGIC),
5.375%, 9/15/2015.................................... 1,143,411
</TABLE>
16
<PAGE>
EVERGREEN
New Jersey Municipal Bond Fund
Schedule of Investments(continued)
March 31, 2000
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
MUNICIPAL OBLIGATIONS - continued
New Jersey - continued
$ 335,000 Middletown Township, NJ GO,
5.20%, 8/1/2007..................................... $ 339,251
960,000 Millburn Township, NJ Sch. Dist. GO,
5.35%, 7/15/2011.................................... 984,307
Monmouth Cnty., NJ Impt. Auth., RB:
800,000 6.40%, 8/1/2008..................................... 834,944
200,000 6.40%, 8/1/2009..................................... 208,736
200,000 Montgomery Township, NJ GO,
6.75%, 6/1/2002..................................... 208,628
1,000,000 Morris Cnty., NJ GO,
6.00%, 7/15/2004.................................... 1,048,700
New Jersey Bldg. Auth. RB:
1,000,000 5.00%, 6/15/2013.................................... 966,160
100,000 6.75%, 6/15/2002.................................... 104,306
New Jersey EDA RB:
1st Mtge., Fellowship Village, Ser. A:
530,000 5.20%, 1/1/2009..................................... 476,189
585,000 5.30%, 1/1/2010..................................... 520,328
4,500,000 1st Mtge., Franciscan Oaks Proj.,
5.75%, 10/1/2023.................................... 3,640,320
1st Mtge., Keswick Pines:
805,000 5.00%, 1/1/2002..................................... 789,874
845,000 5.10%, 1/1/2003..................................... 820,064
3,550,000 5.70%, 1/1/2018..................................... 2,917,603
1,400,000 1st Mtge., Reformed Church,
5.375%, 12/1/2018................................... 1,135,442
1st Mtge., The Evergreens:
680,000 6.00%, 10/1/2017.................................... 590,118
4,110,000 6.00%, 10/1/2022.................................... 3,462,387
3,000,000 Continental Airlines Inc. Proj.,
6.625%, 9/15/2012................................... 3,040,770
2,430,000 Dept. of Human Svcs., Ser. A,
5.70%, 7/1/2012..................................... 2,446,816
500,000 Performing Arts Ctr. Proj., (Insd. by AMBAC),
5.50%, 6/15/2013.................................... 506,875
1,000,000 Pub. Sch. Small Proj. Loan Prog.,
5.40%, 8/15/2013.................................... 1,005,020
55,000 Rutgers State Univ. Civic Square, (Insd. by AMBAC),
6.125%, 7/1/2024.................................... 56,354
1,000,000 Trans. Proj., Ser. A, (Insd. by FSA),
5.75%, 5/1/2011..................................... 1,052,730
200,000 Trenton Office Complex,
6.625%, 6/15/2001................................... 204,976
300,000 New Jersey EDA Wtr. Facs. RB, Ser. A,
6.60%, 8/1/2021..................................... 309,438
New Jersey Edl. Facs. Auth. RB:
2,000,000 Higher Ed. Facs., Ser. A, (Insd. by AMBAC),
5.125%, 9/1/2010.................................... 1,995,920
1,000,000 Montclair Univ., Ser. C, (Insd. by AMBAC),
5.25%, 7/1/2007..................................... 1,014,970
250,000 Princeton Univ., Ser. A,
5.75%, 7/1/2009..................................... 256,692
1,500,000 Princeton Univ., Ser. C,
6.375%, 7/1/2022.................................... 1,580,100
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
MUNICIPAL OBLIGATIONS - continued
New Jersey - continued
New Jersey Edl. Facs. Auth.
RB: - continued
$ 500,000 Rider College, Ser. D, (Insd. by AMBAC),
6.20%, 7/1/2017....................................... $ 513,585
Stevens Institute of Technology, Ser. I:
150,000 4.60%, 7/1/2008....................................... 142,181
200,000 5.00%, 7/1/2009....................................... 194,928
500,000 Trenton State College, Ser. B, (Insd. by AMBAC),
5.80%, 7/1/2009....................................... 522,475
1,000,000 New Jersey Environmental Infrastructure RB,
4.50%, 9/1/2015....................................... 886,410
New Jersey GO:
890,000 4.75%, 3/1/2015....................................... 817,518
500,000 6.25%, 8/1/2006....................................... 521,475
500,000 Ser. D,
5.80%, 2/15/2007...................................... 524,175
6,500,000 Ser. E,
6.00%, 7/15/2009...................................... 6,957,730
3,000,000 Ser. F,
5.50%, 8/1/2011....................................... 3,096,870
New Jersey Healthcare Facs. Fin. Auth. RB:
1,525,000 5.875%, 7/1/2024...................................... 1,580,114
3,365,000 Atlantic City Med. Ctr.,
6.30%, 7/1/2001....................................... 3,415,811
1,345,000 Atlantic Health Sys. Hosp. Corp., Ser. A, (Insd. by
AMBAC),
6.00%, 7/1/2011....................................... 1,429,748
50,000 Bridgeton Hosp. Assn., Ser. B,
6.00%, 7/1/2013....................................... 52,988
3,825,000 Burdette Tomlin Mem. Hosp.,
5.60%, 7/1/2019....................................... 3,500,487
50,000 Burlington Cnty. Mem. Hosp. Proj.,
6.00%, 7/1/2012...................................... 53,124
750,000 Hackensack Med. Ctr., (Insd. by FGIC),
6.625%, 7/1/2017..................................... 783,660
500,000 Kimball Community Ctr.,
4.75%, 7/1/2019....................................... 439,025
Meridian Health Sys.,
(Insd. by FSA):
3,750,000 5.50%, 7/1/2010....................................... 3,844,162
6,235,000 5.625%, 7/1/2011...................................... 6,432,961
500,000 Shore Mem. Healthcare Sys., (Insd. by MBIA),
5.00%, 7/1/2012....................................... 483,945
1,000,000 St. Joseph's Hosp. & Med. Ctr., Ser. D,
5.70%, 7/1/2011....................................... 1,031,750
905,000 New Jersey Higher Ed. Assistance Auth. RB, Ser. A,
(Insd. by MBIA),
5.80%, 6/1/2016....................................... 918,403
New Jersey Hsg. & Mtge. Fin. Agcy. MHRB:
3,140,000 5.30%, 10/1/2008...................................... 3,144,270
4,385,000 5.40%, 10/1/2009...................................... 4,412,319
1,000,000 Ser. A, (Insd. by FSA),
5.05%, 11/1/2018...................................... 911,720
750,000 Ser. B, (Insd. by FSA),
6.05%, 11/1/2017...................................... 764,512
</TABLE>
17
<PAGE>
EVERGREEN
New Jersey Municipal Bond Fund
Schedule of Investments (continued)
March 31, 2000
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
MUNICIPAL OBLIGATIONS - continued
New Jersey - continued
$ 400,000 New Jersey Hsg. Fin. Agcy. GO, Ser. A,
6.70%, 11/1/2004.................................... $ 414,316
New Jersey Hwy. Auth. RB, Garden State Parkway:
1,000,000 5.15%, 1/1/2007..................................... 1,009,000
1,500,000 6.25%, 1/1/2014..................................... 1,557,800
New Jersey Sports & Exposition Auth. RB, Ser. A:
1,000,000 5.375%, 9/1/2015.................................... 996,320
4,085,000 5.75%, 3/1/2010..................................... 4,295,949
200,000 6.00%, 3/1/2002..................................... 205,072
1,000,000 6.00%, 3/1/2015..................................... 1,048,680
1,000,000 6.00%, 3/1/2021..................................... 1,009,466
New Jersey Trans. Auth. RB:
Ser. A:
1,200,000 5.625%, 6/15/2013................................... 1,245,852
1,500,000 5.625%, 6/15/2014................................... 1,548,855
1,300,000 5.75%, 6/15/2015.................................... 1,354,899
1,000,000 6.00%, 6/15/2002.................................... 1,026,520
3,000,000 (Insd. by MBIA),
6.00%, 12/15/2006................................... 3,177,630
Ser. B:
2,750,000 5.25%, 6/15/2015.................................... 2,690,627
1,000,000 (Insd. by MBIA),
6.50%, 6/15/2010.................................... 1,106,860
300,000 New Jersey Transit Corp., COP,
(Insd. by FSA),
6.50%, 10/1/2016.................................... 322,362
New Jersey Univ. of Medicine & Dentistry RB, Ser. E:
400,000 5.75%, 12/1/2021.................................... 407,308
500,000 6.50%, 12/1/2018.................................... 524,270
New Jersey Wst. & Wtr. Treatment RB:
2,670,000 7.00%, 5/15/2007.................................... 2,988,184
Ser. A:
1,000,000 5.25%, 9/1/2012..................................... 1,002,650
2,000,000 6.00%, 7/1/2011..................................... 2,074,715
2,000,000 Ser. C, (Insd. by MBIA),
6.625%, 5/15/2007................................... 2,189,460
2,000,000 New Jersey Wtr. Supply Auth. RB, Raritan Sys., (Insd.
by MBIA),
5.25%, 11/1/2008.................................... 2,015,020
1,000,000 North Bergen Township, NJ Muni. Util. Auth. Swr. RB,
(Insd. by FGIC),
5.375%, 12/15/2012.................................. 1,006,990
North Brunswick Township, NJ Board of Ed. GO:
700,000 5.00%, 2/1/2012..................................... 682,262
150,000 6.30%, 2/1/2012..................................... 158,862
250,000 7.15%, 12/15/2004................................... 273,688
North Brunswick Township, NJ GO:
1,000,000 6.00%, 12/1/2008.................................... 1,046,520
350,000 6.125%, 5/15/2004................................... 365,162
1,000,000 North Hudson, NJ Swr. Auth. RB,
(Insd. by FGIC),
5.50%, 8/1/2006..................................... 1,028,970
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
MUNICIPAL OBLIGATIONS - continued
New Jersey - continued
$ 350,000 North Jersey Dist. Wtr. Supply RB, Wanaque North
Proj., Ser. B,
(Insd. by MBIA),
6.25%, 11/15/2017................................... $ 364,455
1,000,000 Northwest Bergen Cnty., NJ Util. Auth. Sys. RB,
(Insd. by MBIA),
6.00%, 7/15/2009.................................... 1,043,520
500,000 Ocean City., NJ GO, (Insd. by MBIA),
5.90%, 3/15/2003.................................... 516,085
Ocean Cnty., NJ GO:
250,000 6.375%, 4/15/2003................................... 261,710
1,000,000 Ser. A,
6.25%, 10/1/2010.................................... 1,043,520
Ocean Cnty., NJ Util. Auth. Wst. & Wtr. RB, Ser. A:
500,000 5.75%, 1/1/2018..................................... 502,790
200,000 6.60%, 1/1/2011..................................... 205,234
300,000 Ocean Township, NJ Muni. Util. Auth. RB, (Insd. by
MBIA),
5.20%, 8/1/2005..................................... 304,038
Old Bridge Township, NJ Muni. Util. Auth. RB, (Insd.
by FGIC):
285,000 5.75%, 11/1/2000.................................... 287,722
500,000 6.25%, 11/1/2016.................................... 524,120
500,000 Orange Township, NJ GO,
(Insd. by FSA),
6.60%, 2/1/2007..................................... 525,825
1,000,000 Parsippany Troy Hills Township, NJ GO, (Insd. by
MBIA),
4.75%, 12/1/2011.................................... 960,940
500,000 Passaic Cnty., NJ GO, (Insd. by MBIA),
5.40%, 12/1/2002.................................... 510,400
500,000 Passaic Valley, NJ Swr. Comm. RB,
Ser. D, (Insd. by AMBAC),
5.75%, 12/1/2013.................................... 510,600
500,000 Patterson, NJ GO, (Insd. by FSA),
6.20%, 2/15/2002.................................... 513,910
500,000 Randolph Township, NJ Sch. Dist. GO, (Insd. by FSA),
6.30%, 3/15/2006.................................... 535,445
500,000 Rutgers State Univ. RB, Ser. 1,
5.25%, 5/1/2012..................................... 499,535
500,000 Secaucus, NJ Muni. Util. Auth. Swr. RB, Ser. A,
6.10%, 12/1/2010.................................... 522,745
100,000 Somerset Raritan Valley, NJ RB, Ser. E,
6.95%, 7/1/2003..................................... 106,339
1,000,000 South Brunswick Township, NJ Board of Ed. GO, (Insd.
by FGIC),
6.40%, 8/1/2011..................................... 1,070,540
1,100,000 Sparta Township, NJ GO,
(Insd. by MBIA),
5.80%, 9/1/2023..................................... 1,152,657
Stafford, NJ Muni. Util. Auth. RB:
500,000 6.20%, 6/1/2007..................................... 523,509
400,000 6.30%, 6/1/2006..................................... 408,708
460,000 Ser. A, (Insd. by FGIC),
5.80%, 12/1/2008.................................... 472,535
</TABLE>
18
<PAGE>
EVERGREEN
New Jersey Municipal Bond Fund
Schedule of Investments (continued)
March 31, 2000
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
MUNICIPAL OBLIGATIONS - continued
New Jersey - continued
Stony Brook, NJ Regl. Sewage Auth. RB:
$ 400,000 Ser. A,
5.40%, 12/1/2004................................... $ 409,396
500,000 Ser. B,
5.45%, 12/1/2012................................... 512,200
500,000 Sussex Cnty., NJ GO, (Insd. by AMBAC),
6.00%, 4/1/2002.................................... 512,560
1,000,000 Sussex Cnty., NJ Muni. Util. Auth. Solid Wst. RB,
Ser. B, (Insd. by MBIA),
5.50%, 12/1/2013................................... 1,005,080
Tinton Falls, NJ Sch. GO:
(Insd. by MBIA)
490,000 5.85%, 10/15/2002.................................. 504,984
745,000 5.85%, 10/15/2004.................................. 777,780
1,095,000 Toms River, NJ Board of Ed., Sch. Bond Reserve Act
GO, (Insd. by FGIC),
5.75%, 7/15/2019................................... 1,147,286
200,000 Totowa, NJ GO,
7.20%, 1/15/2001................................... 204,298
500,000 Trenton, NJ GO, (Insd. by MBIA),
6.55%, 8/15/2009................................... 529,435
Voorhees Township, NJ GO:
370,000 5.95%, 7/15/2007................................... 390,894
200,000 6.875%, 9/1/2004................................... 215,836
200,000 Warren Township, NJ Swr. Auth. GO,
6.65%, 12/1/2012................................... 213,300
130,000 Washington Township, NJ Board of Ed. GO, Warren
Cnty.,
7.50%, 4/15/2009................................... 150,427
200,000 West Morris, NJ Regl. High Sch.
Dist. GO,
5.875%, 1/15/2001.................................. 202,710
50,000 West Windsor Township, NJ Pkg.
Auth. RB,
6.10%, 12/1/2012................................... 52,104
Winslow Township, NJ GO,
(Insd. by FGIC):
400,000 6.10%, 10/1/2002................................... 414,360
500,000 6.50%, 10/1/2018................................... 529,840
------------
172,576,022
------------
New York - 3.2%
Port Auth. NY & NJ RB:
300,000 Ser. 78,
6.20%, 10/15/2003.................................. 310,734
50,000 Ser. 81,
5.70%, 8/1/2007.................................... 51,137
650,000 Ser. 94,
5.60%, 12/1/2009................................... 666,647
1,000,000 Ser. 104, (Insd. by AMBAC),
5.20%, 7/15/2015................................... 972,390
5,000,000 Spl. Obl., JFK Intl. Arpt. Terminal, 5.75%,
12/1/2025.......................................... 4,913,950
------------
6,914,858
------------
Pennsylvania - 2.0%
Delaware River Joint Toll Brdg. Commission RB,
(Insd. by FGIC):
300,000 6.00%, 7/1/2002.................................... 308,337
475,000 6.25%, 7/1/2012.................................... 487,953
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
MUNICIPAL OBLIGATIONS - continued
Pennsylvania - continued
Delaware River Port Auth. PA & NJ RB: (Insd. by
FGIC),
$2,500,000 5.40%, 1/1/2015.................................... $ 2,492,225
1,000,000 5.40%, 1/1/2016.................................... 990,500
------------
4,279,015
------------
Puerto Rico - 4.7%
1,000,000 Cmnwlth. of Puerto Rico Aqueduct & Swr. Auth. RB,
(Gtd. by IBC & Insd. by MBIA),
6.25%, 7/1/2012.................................... 1,110,470
500,000 Cmnwlth. of Puerto Rico Elec. Pwr. Auth. RB, Ser. P,
7.00%, 7/1/2021.................................... 526,450
Cmnwlth. of Puerto Rico GO:
1,000,000 5.375%, 7/1/2021................................... 973,360
500,000 5.50%, 7/1/2013.................................... 503,575
1,115,000 6.50%, 7/1/2008.................................... 1,234,773
1,000,000 6.50%, 7/1/2023.................................... 1,084,060
Cmnwlth. of Puerto Rico Hwy. & Trans. Auth. RB:
2,300,000 Ser. W,
(Gtd. by IBC & Insd. by MBIA),
5.50%, 7/1/2015.................................... 2,357,201
2,000,000 Ser. Z, (Insd. by FSA),
6.00%, 7/1/2018.................................... 2,140,400
250,000 Cmnwlth. of Puerto Rico Pub. Bldg. Auth. RB, Govt.
Facs., Ser. A,
(Insd. by AMBAC),
6.25%, 7/1/2009.................................... 274,060
------------
10,204,349
------------
U. S. Virgin Islands - 2.0%
1,500,000 Virgin Islands Wtr. & Pwr. Auth. Elec. Sys. RB,
5.125%, 7/1/2003................................... 1,491,690
3,000,000 Virgin Islands, Pub. Fin. Auth. RB, Sr. Lien, Ser.
A,
5.50%, 10/1/2013................................... 2,846,610
------------
4,338,300
------------
Total Municipal Obligations (cost $199,112,139)..... 199,303,044
------------
<CAPTION>
Shares
<C> <S> <C>
MUTUAL FUND SHARES - 6.4%
9,943,000 Federated Municipal Obligations Fund................ 9,943,000
3,928,000 Federated Tax Free Obligations Fund................. 3,928,000
------------
Total Mutual Fund Shares
(cost $13,871,000)................................. 13,871,000
------------
</TABLE>
<TABLE>
<C> <S> <C> <C>
Total Investments -
(cost $212,983,139).......................... 98.5% 213,174,044
Other Assets and Liabilities - net............ 1.5 3,174,877
----- ------------
Net Assets ................................... 100.0% $216,348,921
===== ============
</TABLE>
See Combined Notes to Schedules of Investments.
19
<PAGE>
EVERGREEN
Pennsylvania Municipal Bond Fund
Schedule of Investments
March 31, 2000
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
MUNICIPAL OBLIGATIONS - 98.3%
Delaware - 0.1%
$ 1,000,000 Delaware River & Bay Auth. RB,
(Ins. by FGIC),
5.40%, 1/1/2016.................................... $ 990,500
-----------
Pennsylvania - 95.6%
Abington, PA Sch. Dist., GO, Ser. A:
2,000,000 5.625%, 5/15/2020.................................. 2,070,380
2,000,000 5.75%, 5/15/2025................................... 2,082,540
2,090,000 Ser. AA,
5.625%, 5/15/2020.................................. 2,058,922
2,000,000 Albert Gallatin, PA Area Sch. Dist., GO, (Insd. by
MBIA),
5.30%, 9/1/2017.................................... 1,939,320
5,500,000 Allegheny Cnty., PA Arpt. RB, Pittsburgh Intl.
Arpt.,
5.75%, 1/1/2012.................................... 5,660,545
Allegheny Cnty., PA GO, Ser. C-43:
1,500,000 5.70%, 9/15/2008................................... 1,550,505
60,000 5.875%, 9/15/2010.................................. 62,436
Allegheny Cnty., PA Higher Ed. Bldg. Auth. RB,
Chatham College:
1,000,000 Community College, (Ins. by MBIA),
5.80%, 6/1/2013.................................... 1,020,720
6,075,000 Ser. A,
5.375%, 9/1/2028................................... 5,046,563
Allegheny Cnty., PA Hosp. Dev. Auth. RB:
825,000 Allegheny General Hosp. Proj.,
7.25%, 7/1/2003.................................... 854,510
1,000,000 Children's Hosp. of Pittsburgh,
(Insd. by MBIA),
5.375%, 7/1/2017................................... 959,220
75,000 Montefiore Hosp. Assn. of
Western PA,
5.80%, 10/1/2003................................... 76,332
Pittsburgh Mercy Hlth. Sys.:
1,865,000 5.40%, 8/15/2009................................... 1,897,806
1,510,000 5.50%, 8/15/2010................................... 1,531,125
2,445,000 5.50%, 8/15/2011................................... 2,507,225
2,000,000 5.625%, 8/15/2018.................................. 1,995,320
3,870,000 5.625%, 8/15/2026.................................. 3,807,035
200,000 6.45%, 4/1/2001.................................... 204,288
1,000,000 South Hills Hlth. Sys., Ser. A,
5.125%, 5/1/2023................................... 813,200
Univ. of Pittsburgh Med. Ctr. Hlth. Sys., Ser. B:
2,755,000 5.50%, 12/15/2013.................................. 2,759,022
(Insd. by AMBAC),
8,295,000 5.50%, 12/15/2014.................................. 8,261,157
Univ. of Pittsburgh Med. Ctr. Hlth. Sys.,
Presbyterian Univ. Hosp.:
360,000 6.25%, 11/1/2023................................... 373,079
1,000,000 Ser. A, (Ins. by MBIA),
6.00%, 4/1/2005.................................... 1,040,180
Ser. B:
1,000,000 6.00%, 11/1/2006................................... 1,037,150
(Insd. by MBIA),
25,000 6.00%, 11/1/2012................................... 25,733
Allegheny Cnty., PA IDA RB
Env. Impt., USX Corp.:
10,675,000 5.60%, 9/1/2030.................................... 9,133,423
2,000,000 Ser. A,
6.70%, 12/1/2019................................... 2,003,740
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
MUNICIPAL OBLIGATIONS - continued
Pennsylvania - continued
Allegheny Cnty., PA Port Auth. RB:
$ 5,000,000 6.25%, 3/1/2017.................................... $ 5,279,500
5,500,000 6.375%, 3/1/2014................................... 5,929,165
4,500,000 6.375%, 3/1/2015................................... 4,829,670
5,000 Allegheny Cnty., PA Redev. Auth. RB, Home Impt.
Loan, Ser. A,
(Insd. by FHA),
5.70%, 2/1/2007.................................... 4,994
Allegheny Cnty., PA Residential Fin. Auth. SFHRB,
(Coll. by GNMA):
1,285,000 Ser. P,
7.15%, 6/1/2017.................................... 1,304,737
955,000 Ser. Y,
6.60%, 11/1/2014................................... 966,594
Allegheny Cnty., PA Sanitation Auth. Swr. RB:
460,000 6.80%, 7/1/2003.................................... 477,871
2,000,000 Ser. B,
6.50%, 12/1/2011................................... 2,051,340
Allentown, PA Area Hosp. Auth. RB, Sacred Heart
Healthcare Sys., Ser. A:
2,550,000 4.75%, 7/1/2008.................................... 2,292,093
2,350,000 5.00%, 7/1/2010.................................... 2,159,955
Allentown, PA GO:
170,000 5.65%, 7/15/2010................................... 177,261
1,500,000 6.90%, 7/15/2011................................... 1,543,335
1,000,000 Allentown, PA Wtr. RB,
6.85%, 7/15/2008................................... 1,025,950
390,000 Armstrong, PA Sch. Dist. GO,
7.75%, 12/1/2004................................... 415,592
Berks Cnty., PA GO:
1,000,000 6.05%, 11/15/2003.................................. 1,040,710
2,000,000 6.10%, 11/15/2004.................................. 2,093,640
Berks Cnty., PA Muni. Auth. Hosp. RB:
6,255,000 Healthcare Pooled Financing Proj.,
5.00%, 3/1/2028.................................... 5,166,943
Reading Hosp. & Med. Ctr. Proj.:
2,110,000 5.70%, 10/1/2014................................... 2,155,597
65,000 Ser. B,
5.60%, 10/1/2006................................... 66,670
250,000 Bethlehem, PA Ctr. Sch. Dist. GO,
6.95%, 6/1/2011.................................... 257,363
1,000,000 Blair Cnty., PA Hosp. Auth. RB, Altoona Hosp. Proj.,
Ser. A,
5.50%, 7/1/2010.................................... 1,013,200
Bradford, PA Area Sch. Dist. GO:
1,000,000 5.35%, 10/1/2008................................... 1,021,470
1,000,000 5.40%, 10/1/2009................................... 1,023,850
1,105,000 5.50%, 10/1/2010................................... 1,136,625
2,000,000 5.75%, 10/1/2015................................... 2,081,100
Bucks Cnty., PA GO, Ser. A:
2,000,000 6.10%, 3/1/2003.................................... 2,072,080
5,500,000 6.20%, 3/1/2004.................................... 5,763,725
9,825,000 Bucks Cnty., PA IDA RB, USX Corp. Proj.,
5.60%, 3/1/2033.................................... 8,384,164
5,000,000 Bucks Cnty., PA St. Mary's Hosp. Auth. RB, Catholic
Hlth. Initiatives, Ser. A,
5.00%, 12/1/2018................................... 4,346,400
</TABLE>
20
<PAGE>
EVERGREEN
Pennsylvania Municipal Bond Fund
Schedule of Investments (continued)
March 31, 2000
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
MUNICIPAL OBLIGATIONS - continued
Pennsylvania - continued
Bucks Cnty., PA Wtr. & Swr. Auth. RB:
$ 2,000,000 Collection Sewer Sys.,
6.50%, 12/1/2012..................................... $ 2,088,160
1,000,000 Neshaminy Interceptor, (Insd. by FGIC),
6.20%, 12/1/2003..................................... 1,022,540
4,485,000 Cambria Cnty., PA GO, Ser. A,
(Insd. by FGIC),
6.625%, 8/15/2012.................................... 4,799,757
Center City Dist., PA Bus. Impt. Spl. Assmt. RB:
1,085,000 5.45%, 12/1/2006..................................... 1,112,928
1,145,000 5.55%, 12/1/2007..................................... 1,182,407
1,210,000 5.60%, 12/1/2008..................................... 1,251,007
Central Bucks, PA Sch. Dist. GO:
175,000 6.60%, 2/1/2003...................................... 178,131
3,000,000 6.90%, 2/1/2008...................................... 3,057,240
Ser. A:
1,000,000 6.90%, 11/15/2013.................................... 1,082,190
1,405,000 6.90%, 11/15/2014.................................... 1,520,477
1,000,000 Central Dauphin, PA Sch. Dist. GO,
5.90%, 6/1/2000...................................... 1,002,840
Chester Cnty., PA GO:
3,000,000 7.00%, 12/15/2011.................................... 3,096,390
4,290,000 Ser. B,
5.625%, 11/15/2016................................... 4,434,573
3,275,000 Cocalico, PA Lancaster Cnty. Sch. Dist. GO, (Insd. by
MBIA),
6.85%, 3/1/2011...................................... 3,352,126
4,755,000 Columbia Cnty., PA Hosp. Auth. RB, Bloomburg Hosp.
Proj.,
5.80%, 6/1/2019...................................... 3,988,114
2,500,000 Conestoga Valley, PA Sch. Dist. GO,
7.10%, 5/1/2011...................................... 2,573,375
1,500,000 Conrad Weiser, PA Area Sch. Dist. GO, (Insd. by MBIA),
6.85%, 12/15/2014.................................... 1,624,065
1,405,000 Cornwall & Lebanon, PA Suburban Joint Sch. Auth. RB,
(Insd. by FGIC),
5.60%, 3/1/2007...................................... 1,442,120
2,000,000 Council Rock, PA Sch. Dist. GO,
6.60%, 3/1/2003...................................... 2,038,840
Crawford Cnty., PA Central Sch. Dist. GO, (Insd. by
FGIC):
1,500,000 5.55%, 2/15/2008..................................... 1,541,715
2,085,000 5.65%, 2/15/2009..................................... 2,151,908
1,000,000 Crawford Cnty., PA Hosp. Auth. RB, Wesbury United
Methodist Community Hosp.,
6.125%, 8/15/2019.................................... 889,950
1,000,000 Dauphin Cnty., PA Gen. Auth. Hlth. Sys. RB, Pinnacle
Hlth. Sys. Proj.,
(Insd. by MBIA),
5.50%, 5/15/2017..................................... 976,110
Dauphin Cnty., PA Gen. Auth. RB, Forum Place Office &
Pkg.:
15,000,000 Ser. A,
6.00%, 1/15/2025..................................... 13,438,200
6,300,000 Hyatt Regency Hotel & Conf. Ctr.,
6.00%, 1/1/2010...................................... 5,901,588
3,000,000 Dauphin Cnty., PA GO,
5.45%, 8/1/2007...................................... 3,061,230
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
MUNICIPAL OBLIGATIONS - continued
Pennsylvania - continued
Delaware Cnty., PA College Auth. RB, Haverford
College:
$ 1,000,000 5.75%, 11/15/2025.................................... $ 991,980
(Insd. by MBIA):
1,000,000 7.00%, 11/15/2005.................................... 1,036,850
1,250,000 7.25%, 11/15/2010.................................... 1,297,962
Delaware Cnty., PA GO:
310,000 5.50%, 10/1/2015..................................... 310,146
1,750,000 5.55%, 10/1/2010..................................... 1,804,810
2,385,000 Prerefunded,
5.50%, 10/1/2015..................................... 2,449,800
Delaware Cnty., PA Hosp. Auth. RB, Riddle Mem. Hosp.:
5,345,000 5.25%, 1/1/2016...................................... 5,070,053
9,450,000 5.50%, 1/1/2022...................................... 8,967,105
1,350,000 Delaware Cnty., PA IDA PCRB, Philadelphia Elec. Co.,
Ser. A,
7.375%, 4/1/2021..................................... 1,400,287
1,300,000 Delaware Cnty., PA Regl. Wtr. RB,
Ser. A,
7.20%, 5/1/2004...................................... 1,303,081
Delaware Cnty., PA Univ. Auth. RB, Villanova Univ.:
5,000,000 5.80%, 8/1/2025...................................... 4,974,550
3,000,000 6.85%, 8/1/2011...................................... 3,091,560
1,400,000 Delaware River Port Auth., PA & NJ RB, (Insd. by
FGIC),
5.45%, 1/1/2012...................................... 1,420,188
5,250,000 Delaware Valley, PA Regl. Fin. RB,
Ser. A,
5.50%, 8/1/2028...................................... 5,069,925
Delaware Valley, PA Sch. Dist. GO,
Ser. A:
1,000,000 6.40%, 4/1/2000...................................... 1,000,000
200,000 6.50%, 10/1/2001..................................... 205,476
15,000 Dover Township, PA Swr. Auth. RB,
6.25%, 5/1/2012...................................... 15,664
1,700,000 Downingtown, PA Area Sch. Dist. GO,
7.25%, 4/1/2007...................................... 1,726,146
3,600,000 Elizabethtown, PA Area Sch. Dist. GO,
5.125%, 9/1/2009..................................... 3,602,952
5,000,000 Erie Cnty., PA GO, Ser. B,
6.75%, 9/1/2016...................................... 5,153,850
500,000 Erie Cnty., PA IDA Env. Impt. RB, Intl. Paper Co.
Proj., Ser. A,
7.625%, 11/1/2018.................................... 536,335
1,000,000 Fox Chapel, PA Area Sch. Dist., GO,
5.50%, 8/15/2009..................................... 1,011,880
1,000,000 Gateway, PA Allegheny Cnty. Sch. Dist. GO, (Insd. by
FGIC),
5.25%, 7/15/2017..................................... 958,260
Geisinger, PA Hlth. Sys. Auth. RB,
Ser. A:
1,640,000 5.00%, 8/15/2028..................................... 1,363,824
1,685,000 5.50%, 8/15/2010..................................... 1,691,487
1,385,000 6.00%, 7/1/2006...................................... 1,446,857
1,500,000 Greene Cnty., PA IDA RB, Monongahela Pwr. Co., Ser. B,
5.10%, 2/1/2012...................................... 1,400,160
</TABLE>
21
<PAGE>
EVERGREEN
Pennsylvania Municipal Bond Fund
Schedule of Investments(continued)
March 31, 2000
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
MUNICIPAL OBLIGATIONS - continued
Pennsylvania - continued
$ 1,000,000 Harrisburg, PA Lease Auth. RB,
(Insd. by FSA),
6.25%, 6/1/2001.................................... $ 1,021,230
2,985,000 Hatboro-Horsham, PA Sch. Dist. GO, Ser. A,
6.75%, 4/1/2010.................................... 3,050,252
750,000 Haverford Township, PA GO,
6.70%, 12/1/2011................................... 775,493
Hempfield, PA Lancaster Cnty. Sch. Dist. GO:
2,405,000 6.10%, 8/15/2002................................... 2,479,483
300,000 7.10%, 10/15/2005.................................. 301,476
3,650,000 Horizon Hosp. Sys. Auth. PA Hosp. RB,
6.35%, 5/15/2026................................... 3,214,993
9,600,000 Indiana Cnty., PA IDA PCRB, PA Elec. Co. Proj.,
(Insd. by MBIA),
5.35%, 11/1/2010................................... 9,767,232
Lancaster Cnty., PA Hosp. Auth. RB, Lancaster
General Hosp. Proj.,
(Insd. by AMBAC):
1,220,000 4.70%, 7/1/2009.................................... 1,146,507
3,000,000 4.75%, 7/1/2011.................................... 2,774,850
Lancaster, PA Sch. Dist. GO,
(Insd. by FGIC):
1,000,000 5.60%, 5/15/2007................................... 1,027,660
1,585,000 5.80%, 5/15/2009................................... 1,640,554
1,000,000 Lancaster, PA Solid Wst. Mgmt. Auth. RB, Resource
Recovery Sys., Ser. A, 6.30%, 12/15/2000........... 1,005,890
Latrobe, PA IDA College RB,
St. Vincent College Proj.:
2,635,000 5.375%, 5/1/2018................................... 2,314,584
5,600,000 5.375%, 5/1/2024................................... 4,748,128
Lehigh Cnty., PA Gen. Purpose Auth. RB,
Good Shepherd Rehab. Hosp.:
1,700,000 7.30%, 11/15/2004.................................. 1,801,762
1,000,000 7.50%, 11/15/2021.................................. 1,062,950
1,600,000 Healtheast Inc., Ser. A, (Insd. by MBIA),
7.00%, 7/1/2015.................................... 1,640,608
Lehigh Valley Hosp. Inc. Ser. A:
2,245,000 5.875%, 7/1/2015................................... 2,281,144
1,250,000 (Insd. by MBIA),
7.00%, 7/1/2016.................................... 1,446,650
Lower Merion Township, PA GO:
100,000 5.625%, 8/1/2005................................... 101,485
1,000,000 5.75%, 8/1/2009.................................... 1,018,890
Manheim, PA Central Sch. Dist., GO:
1,085,000 5.60%, 5/15/2006................................... 1,115,011
100,000 6.10%, 5/15/2014................................... 104,613
1,370,000 McKeesport, PA Area Sch. Dist. GO, Ser. A,
6.80%, 4/1/2000.................................... 1,370,000
1,305,000 Mon Valley, PA Swr. Auth. RB,
(Insd. by MBIA),
6.55%, 11/1/2019................................... 1,394,575
Montgomery Cnty., PA Higher Ed. & Hlth. Auth. RB:
1,000,000 Abington Mem. Hosp., Ser. A,
(Insd. by AMBAC),
6.40%, 6/1/2002..................................... 1,022,850
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
MUNICIPAL OBLIGATIONS - continued
Pennsylvania - continued
Montgomery Cnty., PA Higher Ed. & Hlth. Auth. RB -
continued
$ 1,560,000 Beaver College,
5.70%, 4/1/2027.................................... $ 1,493,591
1,025,000 Cnty. Cmnty. College Proj.,
6.75%, 11/1/2002................................... 1,040,170
6,000,000 Philadelphia Geriatric Ctr., Ser. A,
7.25%, 12/1/2024................................... 5,668,200
1,665,000 St. Joseph's Univ.,
6.40%, 12/15/2006.................................. 1,751,164
950,000 Montgomery Cnty., PA IDA PCRB, Philadelphia Elec.
Co., Ser. A,
7.60%, 4/1/2021.................................... 988,599
22,000,000 Montgomery Cnty., PA IDA RB, Retirement-Life
Communities,
5.25%, 11/15/2028.................................. 17,090,040
1,000,000 Neshaminy, PA Sch. Dist. GO,
6.10%, 2/15/2007................................... 1,030,970
1,815,000 Neshaminy, PA Wtr. Resources Auth. RB,
5.40%, 3/1/2013.................................... 1,814,891
2,560,000 New Morgan, PA Muni. Auth. RB, Cmnwlth. Office
Proj., Ser. A,
6.50%, 6/1/2025.................................... 2,347,776
1,000,000 Norristown, PA Area Sch. Dist. GO,
6.90%, 9/1/2011.................................... 1,033,090
3,550,000 North Penn, PA Sch. Dist. GO, Ser. AAA,
6.15%, 9/15/2009................................... 3,665,162
North Penn, PA Wtr. Auth. RB,
(Insd. by FGIC):
3,705,000 5.75%, 11/1/2018................................... 3,722,339
1,000,000 6.00%, 11/1/2007................................... 1,035,410
North Wales, PA Wtr. Auth. RB,
(Insd. by FGIC):
4,530,000 5.60%, 11/1/2020................................... 4,448,369
100,000 6.75%, 11/1/2010................................... 107,677
Northampton Cnty., PA Higher Ed. Auth. RB, Lehigh
Univ. (Insd. by MBIA):
1,000,000 6.90%, 10/15/2006.................................. 1,053,690
3,000,000 7.00%, 10/15/2011.................................. 3,165,480
500,000 Moravian College
5.125%, 7/1/2019................................... 447,255
830,000 Northampton Cnty., PA Hosp. Auth. RB, Easton Hosp.,
7.70%, 1/1/2004.................................... 840,583
735,000 Northampton Cnty., PA IDA RB, Strawbridge Proj.,
7.20%, 12/15/2001.................................. 757,947
Northeastern PA Hosp. Auth. RB, Nesbitt Mem. Hosp.:
745,000 Ser. A,
7.50%, 7/1/2007.................................... 765,644
1,000,000 Ser. B,
7.50%, 7/1/2007.................................... 1,027,710
600,000 Ser. C,
7.50%, 7/1/2007.................................... 616,626
Norwin, PA Sch. Dist. GO,
(Insd. by FGIC):
1,030,000 6.00%, 4/1/2011.................................... 1,096,930
1,090,000 6.00%, 4/1/2012.................................... 1,155,585
</TABLE>
22
<PAGE>
EVERGREEN
Pennsylvania Municipal Bond Fund
Schedule of Investments (continued)
March 31, 2000
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
MUNICIPAL OBLIGATIONS - continued
Pennsylvania - continued
Norwin, PA Sch. Dist. GO, (Insd. by FGIC) -
continued
$ 1,155,000 6.25%, 4/1/2013.................................... $ 1,241,186
2,000,000 Owen J. Roberts Sch. Dist., PA
GO, Ser. A, (Insd. by MBIA),
5.375%, 5/15/2018.................................. 1,942,400
Parkland, PA Sch. Dist. GO:
1,535,000 5.60%, 9/1/2010.................................... 1,571,349
2,125,000 5.65%, 9/1/2011.................................... 2,175,235
2,250,000 5.70%, 9/1/2012.................................... 2,299,657
1,000,000 Penn Hills, PA GO, (Insd. by AMBAC),
5.60%, 12/1/2005................................... 1,022,040
Pennridge, PA Sch. Dist. GO, Ser. A:
1,000,000 6.05%, 2/15/2002................................... 1,023,950
1,000,000 (Insd. by AMBAC),
6.15%, 2/15/2003................................... 1,023,470
Pennsylvania Convention Ctr. Auth. RB: Ser. A,
(Insd. by FGIC):
1,000,000 6.60%, 9/1/2000.................................... 1,010,170
8,500,000 6.70%, 9/1/2016.................................... 9,595,990
12,295,000 Ser. A., (Insd. by MBIA),
6.75%, 9/1/2019.................................... 13,163,273
2,000,000 Ser. A, (Eff. Yield 6.95%),
(Insd. by FGIC),
0.00%, 9/1/2008 (a)................................ 1,285,600
Pennsylvania Econ. Dev. Financing Auth. Resource
Recovery RB, Colver Proj., Ser. D:
1,000,000 7.05%, 12/1/2010................................... 1,031,270
1,000,000 7.125%, 12/1/2015.................................. 1,039,270
5,000,000 7.15%, 12/1/2018................................... 5,122,800
1,500,000 Pennsylvania Fin. Auth. Community College RB, Beaver
Cnty. Proj., Ser. A,
6.00%, 12/1/2014................................... 1,571,160
5,000,000 Pennsylvania Fin. Auth. RB, Muni. Capital Impts.
Program,
6.60%, 11/1/2009................................... 5,300,650
Pennsylvania GO:
2,500,000 6.50%, 11/15/2010.................................. 2,609,950
1st Ser:
2,705,000 6.00%, 1/15/2012................................... 2,883,341
1,000,000 6.00%, 1/15/2014................................... 1,054,120
2nd Ser:
3,000,000 5.50%, 6/15/2010................................... 3,065,910
10,000,000 5.75%, 10/1/2014................................... 10,322,900
25,000 6.00%, 7/1/2005.................................... 26,234
5,000,000 6.25%, 7/1/2010.................................... 5,441,600
5,060,000 6.25%, 7/1/2011.................................... 5,534,830
Pennsylvania HFA SFHRB:
290,000 7.30%, 10/1/2017................................... 295,829
1,300,000 Rental Hsg., (Coll. by FNMA),
6.40%, 7/1/2012.................................... 1,342,172
1,140,000 Ser. 33,
6.90%, 4/1/2017.................................... 1,168,295
2,000,000 Ser. 34A, (Insd. by FHA),
6.85%, 4/1/2016.................................... 2,028,520
3,000,000 Ser. 36,
5.45%, 10/1/2014................................... 2,880,960
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
MUNICIPAL OBLIGATIONS - continued
Pennsylvania - continued
Pennsylvania HFA SFHRB: - continued
$ 750,000 Ser. 40,
6.80%, 10/1/2015..................................... $ 774,532
1,840,000 Ser. 50A,
6.00%, 10/1/2013..................................... 1,910,950
1,500,000 Ser. 57B, (Insd. by FHA),
5.625%, 10/1/2011.................................... 1,517,940
5,000,000 Ser. 65A,
5.20%, 10/1/2018..................................... 4,659,150
Ser. 68A:
2,465,000 5.875%, 4/1/2017..................................... 2,494,506
3,450,000 6.05%, 10/1/2028..................................... 3,477,255
2,000,000 6.10%, 4/1/2021...................................... 2,018,640
Ser. 69A, (Insd. by FHA):
5,900,000 6.15%, 10/1/2020..................................... 5,972,039
1,000,000 6.25%, 4/1/2031...................................... 1,013,720
3,465,000 Ser. 1991-32,
7.15%, 4/1/2015...................................... 3,557,308
Pennsylvania Higher Edl. Facs. Auth. RB:
1,720,000 6.80%, 12/1/2000..................................... 1,747,675
1,500,000 7.25%, 5/1/2010...................................... 1,503,870
Allegheny Delaware Valley Obl.:
3,550,000 5.175%, 11/15/2021................................... 3,535,090
3,000,000 Hlth. Svcs., Ser. A,
5.10%, 11/15/2008.................................... 3,010,020
Bryn Mawr College:
2,450,000 5.40%, 12/1/2009..................................... 2,504,905
2,000,000 5.625%, 12/1/2027.................................... 1,945,180
Drexel Univ.:
1,855,000 5.20%, 5/1/2008...................................... 1,873,940
2,065,000 5.20%, 5/1/2009...................................... 2,078,567
2,200,000 2nd Ser., (Insd. by MBIA),
5.375%, 5/1/2016..................................... 2,159,278
1,000,000 Lasalle Univ.,
5.625%, 5/1/2017..................................... 1,001,550
485,000 Ser. A, (Insd. by MBIA),
6.625%, 8/15/2009.................................... 511,796
5,260,000 Ser. M, (Insd. by AMBAC),
5.625%, 6/15/2019.................................... 5,213,817
State Sys.:
Ser. D:
200,000 7.00%, 6/15/2005..................................... 201,168
1,000,000 7.10%, 6/15/2007..................................... 1,006,040
2,000,000 Ser. E,
7.00%, 6/15/2011..................................... 2,060,200
2,800,000 Ser. K, (Insd. by AMBAC),
5.50%, 6/15/2010..................................... 2,836,400
Ser. N, (Insd. by MBIA):
3,500,000 5.80%, 6/15/2024..................................... 3,482,535
4,000,000 5.875%, 6/15/2021.................................... 4,017,120
Thomas Jefferson Univ.:
3,000,000 (Insd. by AMBAC),
5.375%, 7/1/2013..................................... 3,007,320
Ser. A:
285,000 (Insd. by MBIA),
5.15%, 11/1/2010..................................... 284,341
1,115,000 Prerefunded,
6.625%, 8/15/2009.................................... 1,179,135
</TABLE>
23
<PAGE>
EVERGREEN
Pennsylvania Municipal Bond Fund
Schedule of Investments (continued)
March 31, 2000
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
MUNICIPAL OBLIGATIONS - continued
Pennsylvania - continued
Pennsylvania Higher Edl. Facs. Auth.
RB - continued
Univ. of PA:
Ser. A:
$ 1,100,000 5.70%, 1/1/2011.................................... $ 1,021,471
2,715,000 6.00%, 1/1/2003.................................... 2,719,452
3,440,000 6.00%, 1/1/2004.................................... 3,436,216
Ser. B:
1,000,000 5.30%, 9/1/2006.................................... 1,014,510
1,520,000 5.50%, 1/1/2009.................................... 1,421,519
2,725,000 5.55%, 9/1/2009.................................... 2,780,972
2,145,000 5.60%, 9/1/2010.................................... 2,190,024
4,000,000 5.75%, 1/1/2017.................................... 3,471,800
3,740,000 5.85%, 9/1/2013.................................... 3,828,862
Univ. of PA Hlth. Svcs.:
Ser. A:
2,525,000 5.60%, 1/1/2010.................................... 2,353,855
1,000,000 6.00%, 1/1/2007.................................... 980,910
100,000 6.00%, 1/1/2010.................................... 96,839
4,460,000 Ser. B,
5.70%, 1/1/2011.................................... 4,141,601
Pennsylvania IDA RB,
Econ. Dev.:
2,215,000 (Insd. by AMBAC),
5.80%, 1/1/2008.................................... 2,317,377
250,000 5.80%, 7/1/2009.................................... 262,380
7,595,000 (Insd. by AMBAC)
6.00%, 1/1/2005.................................... 7,928,193
2,000,000 6.00%, 7/1/2006.................................... 2,106,040
305,000 6.00%, 7/1/2009.................................... 324,782
2,000,000 7.00%, 1/1/2006.................................... 2,189,200
7,215,000 Ser. 1994,
6.00%, 1/1/2012.................................... 7,447,395
Pennsylvania Infrastructure Investment Auth. RB:
Pennvest Loan Pool Program,
(Insd. by MBIA),
3,845,000 5.30%, 9/1/2008.................................... 3,907,443
4,365,000 5.40%, 9/1/2009.................................... 4,450,510
2,140,000 5.50%, 9/1/2010.................................... 2,190,526
Pennsylvania Intergovernmental Cooperative Auth.
Spl. Tax RB:
Philadelphia Funding Program,
(Insd. by FGIC):
3,665,000 5.60%, 6/15/2012................................... 3,729,944
3,000,000 5.625%, 6/15/2013.................................. 3,045,960
1,650,000 6.75%, 6/15/2021................................... 1,788,600
Pennsylvania Pub. Sch. Bldg. Auth. RB:
2,400,000 Harrisburg Area Community College,
Ser. D, (Insd. by MBIA),
6.75%, 4/1/2011.................................... 2,493,336
1,260,000 Montgomery Cnty. Community College, Ser. B:
5.60%, 11/1/2005................................... 1,300,093
1,500,000 Tuscarora Sch. Dist. Refunding Proj., Ser. B,
5.70%, 10/15/2003.................................. 1,535,580
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
MUNICIPAL OBLIGATIONS - continued
Pennsylvania - continued
Pennsylvania Turnpike Commission:
Oil Franchise Tax RB,
Ser. A, (Insd. by AMBAC):
$ 2,360,000 5.45%, 12/1/2003..................................... $ 2,412,605
2,000,000 5.50%, 12/1/2004..................................... 2,053,560
Turnpike RB:
Ser. L, (Insd. by AMBAC):
1,000,000 6.45%, 6/1/2003...................................... 1,040,050
1,000,000 6.60%, 6/1/2005...................................... 1,041,740
Ser. O, (Insd. by FGIC):
3,000,000 5.45%, 12/1/2003..................................... 3,064,650
1,000,000 5.60%, 12/1/2005..................................... 1,025,040
1,500,000 5.70%, 12/1/2006..................................... 1,540,590
2,075,000 Ser. P,
5.80%, 12/1/2006..................................... 2,132,747
5,000,000 Ser. U, (Insd. by FGIC),
5.80%, 12/1/2007..................................... 5,130,800
Pennsylvania Univ. RB:
1,000,000 5.30%, 8/15/2003..................................... 1,015,340
2,535,000 5.50%, 8/15/2016..................................... 2,521,311
3,035,000 6.15%, 3/1/2005...................................... 3,160,801
1,000,000 6.25%, 3/1/2011...................................... 1,035,650
1,000,000 6.60%, 7/1/2002...................................... 1,043,450
4,000,000 7.00%, 7/1/2016...................................... 4,193,000
5,000,000 Ser. A,
5.00%, 8/15/2022..................................... 4,438,950
Philadelphia, PA Arpt. Pkg. Auth. RB:
3,695,000 5.625%, 9/1/2016..................................... 3,718,020
1,000,000 5.75%, 9/1/2008...................................... 1,044,680
4,215,000 Philadelphia, PA Arpt. RB, Philadelphia Arpt. Sys.,
Ser. A,
5.125%, 6/15/2013.................................... 4,095,378
Philadelphia, PA GO:
1,530,000 5.00%, 5/15/2015..................................... 1,437,083
2,315,000 Ser. B,
5.80%, 11/15/2007.................................... 2,431,521
Philadelphia, PA Hosp. & Higher Ed. Facs. Auth. RB:
6,000,000 5.125%, 5/15/2018.................................... 5,505,000
1,015,000 Ser. A,
7.00%, 8/15/2017..................................... 1,062,258
240,000 Agnes Med. Ctr. Proj., (Insd. by FHA),
6.75%, 8/15/2001..................................... 240,216
Chestnut Hill College:
1,565,000 5.35%, 10/1/2007..................................... 1,466,374
1,000,000 6.00%, 10/1/2029..................................... 898,720
Children's Hosp. Proj, Ser. A:
1,470,000 5.20%, 2/15/2005..................................... 1,459,930
3,035,000 6.00%, 2/15/2002..................................... 3,090,025
1,500,000 6.25%, 2/15/2005..................................... 1,568,325
Children's Seashore House:
500,000 7.40%, 8/15/2000..................................... 505,960
500,000 7.40%, 8/15/2001..................................... 505,960
Philadelphia, PA Hosp. & Higher Ed. Facs. Auth. RB:
150,000 7.50%, 8/15/2002..................................... 151,841
</TABLE>
24
<PAGE>
EVERGREEN
Pennsylvania Municipal Bond Fund
Schedule of Investments(continued)
March 31, 2000
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
MUNICIPAL OBLIGATIONS - continued
Pennsylvania - continued
Philadelphia, PA Hosp. & Higher Ed. Facs. Auth. RB -
continued
$ 4,000,000 Ser. A,
7.00%, 8/15/2022................................... $ 4,175,600
Community College, Ser. B,
(Insd. by MBIA):
1,135,000 6.25%, 5/1/2005.................................... 1,198,458
1,205,000 6.25%, 5/1/2006.................................... 1,280,517
Jefferson Hlth. Sys., Ser. A:
3,395,000 5.125%, 5/15/2011.................................. 3,125,098
3,555,000 5.125%, 5/15/2012.................................. 3,226,731
5,895,000 5.25%, 5/15/2013................................... 5,725,990
1,250,000 Presbyterian Med. Ctr.,
5.80%, 12/1/2001................................... 1,270,825
Philadelphia, PA IDA RB:
500,000 Girard Estate Coal Mining Proj.,
5.25%, 11/15/2009.................................. 505,240
Natl. Board of Med. Examiners Proj.:
830,000 6.15%, 5/1/2001.................................... 844,608
580,000 6.25%, 5/1/2002.................................... 595,683
Simpson House Proj.:
1,000,000 5.25%, 8/15/2015................................... 821,590
2,200,000 5.375%, 8/15/2020.................................. 1,757,250
2,000,000 Philadelphia, PA Muni. Auth. RB, Justice Lease,
Ser. B,
7.10%, 11/15/2011.................................. 2,115,800
1,900,000 Philadelphia, PA Regl. Port Auth. RB,
6.00%, 9/1/2007.................................... 1,952,307
4,000,000 Philadelphia, PA Sch. Dist. GO, Ser. B,
5.50%, 9/1/2025.................................... 3,800,520
Philadelphia, PA Wtr. & Wst. Wtr. RB:
4,000,000 (Insd. by MBIA),
6.25%, 8/1/2012.................................... 4,374,680
10,355,000 Ser. A,
5.00%, 8/1/2022.................................... 9,205,699
4,500,000 Pittsburgh & Allegheny Cnty., PA Regl. Asset Dist.
Sales Tax RB,
5.25%, 2/1/2031.................................... 4,110,120
25,000 Pittsburgh, PA GO, Ser. D,
(Insd. by AMBAC),
6.125%, 9/1/2017................................... 26,249
1,090,000 Pittsburgh, PA Urban Redev. Auth. RB, Ctr. Triangle
Tax Increment, Ser. A,
6.10%, 5/1/2019.................................... 1,094,905
Pittsburgh, PA Wtr. & Swr. Sys. RB
(Insd. by FGIC):
1,000,000 7.25%, 9/1/2014.................................... 1,141,500
1st Lien, Ser. A:
2,845,000 5.40%, 9/1/2012.................................... 2,911,829
2,715,000 5.50%, 9/1/2013.................................... 2,791,563
1,000,000 Pleasant Valley, PA Sch. Dist. GO,
(Insd. by FGIC),
5.60%, 11/15/2014.................................. 1,005,190
2,000,000 Pocono Mtn., PA Sch. Dist. GO, Ser. AA, (Insd. by
AMBAC),
6.10%, 10/1/2003................................... 2,048,380
8,245,000 Pottsville, PA Hosp. Auth. RB, Ascension Hlth.
Credit, Ser. A,
6.375%, 11/15/2019................................. 8,649,747
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
MUNICIPAL OBLIGATIONS - continued
Pennsylvania - continued
$ 195,000 Radnor Township, PA Sch. Auth. RB, Ser. C,
9.875%, 9/15/2000.................................... $ 199,284
3,800,000 Schuylkill Cnty., PA IDA RB, Variable Pine Grove
Landfill, Inc.,
5.10%, 10/1/2019..................................... 3,263,326
Schuylkill Valley, PA Sch. Dist. GO (Insd. by MBIA):
1,110,000 5.55%, 4/15/2007..................................... 1,134,131
1,185,000 5.65%, 4/15/2008..................................... 1,214,080
Scranton-Lackwanna, PA Hlth. & Welfare Auth. RB:
250,000 Mercy Hlth. Sys. Proj., Ser. B,
(Insd. by MBIA),
5.00%, 1/1/2006...................................... 248,380
Univ. of Scranton Proj.:
1,000,000 5.10%, 11/1/2010..................................... 993,100
150,000 Ser. A,
6.15%, 3/1/2003...................................... 153,315
103,000 Seneca Valley, PA Sch. Dist. GO,
(Insd. by FGIC),
5.85%, 2/15/2015..................................... 109,655
2,000,000 Sharon, PA Regl. Hlth. Sys. Auth. RB,
5.00%, 12/1/2018..................................... 1,795,720
3,450,000 Solanco, PA Sch. Dist. GO,
5.90%, 2/15/2009..................................... 3,576,270
12,220,000 South Fork, PA Muni. Hosp. Auth. RB, Conemaugh Valley
Mem. Hosp.,
Ser. B, (Insd. by MBIA),
5.375%, 7/1/2022..................................... 11,372,421
Southeastern, PA Trans. Auth. Spl. RB, Ser. A:
3,090,000 5.625%, 3/1/2007..................................... 3,211,036
1,290,000 5.75%, 3/1/2008...................................... 1,347,508
185,000 Prerefunded, (Insd. by FGIC),
5.625%, 3/1/2007..................................... 192,246
2,405,000 Stroudsburg, PA Area Sch. Dist. GO,
5.65%, 10/1/2009..................................... 2,491,051
500,000 Swarthmore Borough, PA College Auth. RB,
6.85%, 9/15/2001..................................... 511,025
2,805,000 Union Cnty., PA Higher Edl. Facs. RB, Bucknell Univ.,
(Insd. by MBIA),
4.50%, 4/1/2018...................................... 2,406,550
Unionville-Chadds Ford, PA Sch. Dist. GO:
1,000,000 5.80%, 6/1/2013...................................... 1,028,770
1,000,000 6.65%, 6/1/2004...................................... 1,022,750
1,000,000 6.70%, 6/1/2005...................................... 1,023,310
Univ. of Pittsburgh, PA RB:
40,000 Ser. A, (Insd. by MBIA),
6.125%, 6/1/2021..................................... 40,545
Ser. B, (Insd. by MBIA):
4,010,000 5.50%, 6/1/2009...................................... 4,128,937
5,000 5.90%, 6/1/2003...................................... 5,159
3,265,000 6.10%, 6/1/2005...................................... 3,411,553
2,000,000 6.25%, 6/1/2008...................................... 2,095,981
4,255,000 Area Joint Swr. Auth., (Insd. by MBIA),
5.25%, 11/1/2014..................................... 4,216,322
</TABLE>
25
<PAGE>
EVERGREEN
Pennsylvania Municipal Bond Fund
Schedule of Investments(continued)
March 31, 2000
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
MUNICIPAL OBLIGATIONS - continued
Pennsylvania - continued
Univ. of Pittsburgh, PA RB - continued
$ 4,895,000 University Capital Projs.,
5.125%, 6/1/2022.................................. $ 4,446,765
Upper Merion, PA GO:
2,595,000 5.55%, 8/15/2007.................................. 2,636,209
2,910,000 6.90%, 9/1/2016................................... 3,004,371
Upper Merion, PA Muni. Util. Auth.,
Swr. RB:
1,000,000 6.00%, 8/15/2012.................................. 1,029,050
2,325,000 6.00%, 8/15/2016.................................. 2,358,015
Upper Moreland-Hatboro, PA Joint Swr. Auth. RB,
(Insd. by MBIA):
1,025,000 6.25%, 10/15/2002................................. 1,063,079
1,000,000 6.35%, 10/15/2003................................. 1,050,870
2,065,000 Valley View, PA Sch. Dist. GO, Ser. A, (Insd. by
FGIC),
5.375%, 11/15/2010................................ 2,092,981
1,000,000 Wallenpaupack, PA Area Sch. Dist. GO, Ser. B,
(Insd. by FGIC),
6.00%, 9/1/2003................................... 1,007,010
1,300,000 Washington Cnty., PA Hosp. Auth. RB, Shadyside
Hosp. Proj.,
5.875%, 12/15/2004................................ 1,359,891
West Chester, PA Area Sch. Dist. GO:
2,195,000 6.20%, 9/1/2012................................... 2,254,155
1,000,000 Ser. A:
6.70%, 1/15/2011.................................. 1,019,200
West Mifflin, PA Muni. Sanitation Swr. Auth. RB:
1,000,000 (Insd. by FGIC):,
5.70%, 8/1/2015................................... 1,040,830
2,500,000 Ser. A:,
5.80%, 8/1/2024................................... 2,615,525
6,240,000 West View, PA Muni. Auth. Wtr. RB,
5.15%, 11/15/2017................................. 5,873,650
8,530,000 Westmoreland Cnty., PA IDA RB, Citizens General
Hosp.,
5.00%, 7/1/2008................................... 7,722,977
1,000,000 York Cnty., PA GO, (Insd. by FGIC),
6.00%, 10/1/2004.................................. 1,021,290
1,805,000 York Cnty., PA Hosp. Auth. RB,
York Hosp., (Insd. by AMBAC),
5.25%, 7/1/2017................................... 1,699,371
York, PA City Sch. Dist. GO,
(Insd. by FGIC):
35,000 5.60%, 3/1/2007................................... 35,543
40,000 Prerefunded,
5.60%, 3/1/2007................................... 40,892
------------
832,213,268
------------
Virginia - 0.3%
1,000,000 Arlington Cnty., VA IDA MHRB, Woodbury Park Apts.,
Ser. B,
6.50%, 7/1/2024................................... 922,270
1,750,000 James City Cnty., VA IDA Residential Care Facs. RB,
Williamsburg Landing Inc.,
6.625%, 3/1/2019.................................. 1,735,912
------------
2,658,182
------------
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
MUNICIPAL OBLIGATIONS - continued
Puerto Rico - 1.4%
$ 3,950,000 Cmnwlth. of Puerto Rico GO, Linked BPO, Ser. D,
(Insd. by MBIA),
7.00%, 7/1/2010 (b)............................... $ 4,573,744
3,250,000 Cmnwlth. of Puerto Rico Indl., Tourist, Edl., Med.
& Env. Control Facs. RB, Hosp. Auxilio Mutuo Obl.,
Group A, (Insd. by MBIA),
6.25%, 7/1/2024................................... 3,350,490
1,000,000 Cmnwlth. of Puerto Rico Muni. Fin. Agy. RB, Ser. A,
(Insd. by FSA),
6.00%, 7/1/2011................................... 1,086,960
1,800,000 Cmnwlth. of Puerto Rico Pub. Bldgs. Auth. RB, Gtd.
Pub. Ed. & Hlth. Facs., Ser. M,
5.70%, 7/1/2009................................... 1,880,046
1,000,000 Univ. of Puerto Rico Univ. RB, Ser. N, (Insd. by
MBIA),
6.25%, 6/1/2007................................... 1,084,450
------------
11,975,690
------------
U. S. Virgin Islands - 0.9%
Virgin Islands Pub. Fin. Auth. RB, Sr. Lien,
Ser. A:
1,000,000 5.20%, 10/1/2009.................................. 953,140
1,000,000 5.50%, 10/1/2013.................................. 948,870
1,000,000 5.50%, 10/1/2022.................................. 897,840
2,000,000 5.625%, 10/1/2025................................. 1,809,880
Virgin Islands Wtr. & Pwr. Auth. Elec. Sys. RB:
1,835,000 5.25%, 7/1/2008................................... 1,794,043
1,370,000 5.25%, 7/1/2009................................... 1,331,777
------------
7,735,550
------------
Total Municipal Obligations (cost $857,543,848).... 855,573,190
------------
<CAPTION>
Shares
<C> <S> <C>
MUTUAL FUND SHARES - 0.8%
6,867,000 Federated Municipal Obligations Fund (cost
$6,867,000) ...................................... 6,867,000
------------
</TABLE>
<TABLE>
<C> <S> <C> <C>
Total Investments - (cost $864,410,848)..... 99.1% 862,440,190
Other Assets and Liabilities - net........... 0.9 7,991,970
----- ------------
Net Assets................................... 100.0% $870,432,160
===== ============
</TABLE>
See Combined Notes to Schedules of Investments.
26
<PAGE>
EVERGREEN
State Municipal Bond Funds
Combined Notes to Schedules of Investments
March 31, 2000
(a) Effective yield (calculated at date of purchase) is the annual yield
at which the bond accretes until its maturity date.
(b) At the discretion of the portfolio manager, these securities may be
separated into securities with interest or principal payments that
are linked to another rate or index and therefore would be considered
derivative securities.
Summary of Abbreviations:
AMBAC American Municipal Bond Assurance Corporation
BPO Bond Payment Obligation
COP Certificates of Participation
EDA Economic Development Authority
FGIC Federal Guaranty Insurance Company
FHA Federal Housing Authority
FNMA Federal National Mortgage Association
FSA Financial Security Assurance Incorporated
GNMA Government National Mortgage Association
GO General Obligation
HFA Housing Finance Authority
IBC Insured Bond Certificate
IDA Industrial Development Authority
MBIA Municipal Bond Investors Assurance Corporation
MHRB Multifamily Housing Revenue Bond
PCRB Pollution Control Revenue Bond
RB Revenue Bond
SFHRB Single Family Housing Revenue Bond
See Combined Notes to Financial Statements.
27
<PAGE>
EVERGREEN
State Municipal Bond Funds
Statements of Assets and Liabilities
March 31, 2000
<TABLE>
<CAPTION>
Connecticut New Jersey Pennsylvania
Fund Fund Fund
- -------------------------------------------------------------------------------
<S> <C> <C> <C>
Assets
Identified cost of securities...... $72,917,014 $212,983,139 $864,410,848
Net unrealized gains or losses on
securities........................ (312,778) 190,905 (1,970,658)
- -------------------------------------------------------------------------------
Market value of securities......... 72,604,236 213,174,044 862,440,190
Cash............................... 51 510 134
Receivable for Fund shares sold.... 0 850,608 922,655
Interest receivable................ 1,329,445 3,388,951 13,860,915
Receivable from related parties.... 3,617 2,024 24,186
Prepaid expenses and other assets.. 811 3,003 177,620
- -------------------------------------------------------------------------------
Total assets...................... 73,938,160 217,419,140 877,425,700
- -------------------------------------------------------------------------------
Liabilities
Distributions payable.............. 287,972 788,933 4,046,432
Payable for securities purchased... 1,109,049 0 976,529
Payable for Fund shares redeemed... 0 216,590 1,542,577
Advisory fee payable............... 0 12,414 0
Distribution Plan expenses
payable........................... 128 0 4,022
Due to other related parties....... 594 1,769 7,148
Accrued expenses and other
liabilities....................... 31,089 50,513 416,832
- -------------------------------------------------------------------------------
Total liabilities................. 1,428,832 1,070,219 6,993,540
- -------------------------------------------------------------------------------
Net assets.......................... $72,509,328 $216,348,921 $870,432,160
- -------------------------------------------------------------------------------
Net assets represented by
Paid-in capital.................... $74,543,276 $221,316,543 $889,762,449
Undistributed (overdistributed) net
investment income................. 13,921 6,634 (95,035)
Accumulated net realized gains or
losses on securities.............. (1,735,091) (5,165,161) (17,264,596)
Net unrealized gains or losses on
securities........................ (312,778) 190,905 (1,970,658)
- -------------------------------------------------------------------------------
Total net assets.................... $72,509,328 $216,348,921 $870,432,160
- -------------------------------------------------------------------------------
Net assets consists of
Class A............................ $ 744,119 $ 28,135,177 $ 32,795,481
Class B............................ 1,375,394 19,581,770 35,334,085
Class C............................ 0 0 5,726,393
Class Y............................ 70,389,815 168,631,974 796,576,201
- -------------------------------------------------------------------------------
Total net assets.................... $72,509,328 $216,348,921 $870,432,160
- -------------------------------------------------------------------------------
Shares outstanding
Class A............................ 123,781 2,684,163 3,010,789
Class B............................ 228,792 1,868,060 3,271,479
Class C............................ 0 0 529,208
Class Y............................ 11,709,057 16,087,480 73,132,496
- -------------------------------------------------------------------------------
Net asset value per share
Class A............................ $ 6.01 $ 10.48 $ 10.89
- -------------------------------------------------------------------------------
Class A--Offering price (based on
sales charge of 4.75%)............ $ 6.31 $ 11.00 $ 11.43
- -------------------------------------------------------------------------------
Class B............................ $ 6.01 $ 10.48 $ 10.80
- -------------------------------------------------------------------------------
Class C............................ -- -- $ 10.82
- -------------------------------------------------------------------------------
Class Y............................ $ 6.01 $ 10.48 $ 10.89
- -------------------------------------------------------------------------------
</TABLE>
See Combined Notes to Financial Statements.
28
<PAGE>
EVERGREEN
State Municipal Bond Funds
Statements of Operations
Year Ended March 31, 2000
<TABLE>
<CAPTION>
Connecticut New Jersey Pennsylvania
Fund Fund Fund
- ------------------------------------------------------------------------------
<S> <C> <C> <C>
Investment income
Interest........................... $ 3,742,993 $ 11,209,489 $ 42,232,518
- ------------------------------------------------------------------------------
Expenses
Advisory fee....................... 428,618 1,016,585 2,402,813
Distribution Plan expenses......... 15,755 283,859 511,368
Administrative services fees....... 30,921 90,536 296,370
Transfer agent fee................. 2,311 41,095 82,897
Trustees' fees and expenses........ 1,066 4,265 7,488
Printing and postage expenses...... 17,706 29,145 56,848
Custodian fee...................... 21,127 65,132 261,733
Registration and filing fees....... 4,569 20,011 284,093
Professional fees.................. 23,231 29,260 30,426
Other.............................. 8,572 10,485 64,996
- ------------------------------------------------------------------------------
Total expenses.................... 553,876 1,590,373 3,999,032
Less: Expense reductions........... (2,515) (8,971) (34,474)
Fee waivers.................. (92,329) (360,513) 0
- ------------------------------------------------------------------------------
Net expenses...................... 459,032 1,220,889 3,964,558
- ------------------------------------------------------------------------------
Net investment income.............. 3,283,961 9,988,600 38,267,960
- ------------------------------------------------------------------------------
Net realized and unrealized gains
or losses on securities
Net realized gains or losses on
securities........................ (1,735,091) (5,165,161) (17,264,056)
Net change in unrealized gains or
losses on securities.............. (2,471,997) (6,976,635) (22,426,156)
- ------------------------------------------------------------------------------
Net realized and unrealized gains
or losses on securities........... (4,207,088) (12,141,796) (39,690,212)
- ------------------------------------------------------------------------------
Net decrease in net assets
resulting from operations......... $ (923,127) $ (2,153,196) $ (1,422,252)
- ------------------------------------------------------------------------------
</TABLE>
See Combined Notes to Financial Statements.
29
<PAGE>
EVERGREEN
State Municipal Bond Funds
Statements of Changes in Net Assets
Year Ended March 31, 2000
<TABLE>
<CAPTION>
Connecticut New Jersey Pennsylvania
Fund Fund Fund
- ------------------------------------------------------------------------------
<S> <C> <C> <C>
Operations
Net investment income............. $ 3,283,961 $ 9,988,600 $ 38,267,960
Net realized gains or losses on
securities....................... (1,735,091) (5,165,161) (17,264,056)
Net change in unrealized gains or
losses on securities............. (2,471,997) (6,976,635) (22,426,156)
- ------------------------------------------------------------------------------
Net decrease in net assets
resulting from operations....... (923,127) (2,153,196) (1,422,252)
- ------------------------------------------------------------------------------
Distributions to shareholders from
Net investment income
Class A.......................... (29,677) (1,442,654) (1,552,010)
Class B.......................... (47,904) (790,701) (1,509,695)
Class C.......................... 0 0 (268,474)
Class Y.......................... (3,186,337) (7,750,828) (34,893,891)
Net realized gains
Class A.......................... (2,299) (67,202) (21,064)
Class B.......................... (3,951) (46,764) (22,866)
Class C.......................... 0 0 (4,212)
Class Y.......................... (210,673) (399,038) (528,176)
- ------------------------------------------------------------------------------
Total distributions to
shareholders.................... (3,480,841) (10,497,187) (38,800,388)
- ------------------------------------------------------------------------------
Capital share transactions
Proceeds from shares sold......... 14,810,856 48,598,866 187,587,317
Net asset value of shares issued
in reinvestment of
distributions.................... 282,337 2,163,636 2,638,961
Payment for shares redeemed....... (13,818,971) (46,953,178) (202,177,638)
Net asset value of shares issued
in acquisition................... 0 47,915,180 667,273,557
- ------------------------------------------------------------------------------
Net increase in net assets
resulting from capital share
transactions.................... 1,274,222 51,724,504 655,322,197
- ------------------------------------------------------------------------------
Total increase (decrease) in net
assets.......................... (3,129,746) 39,074,121 615,099,557
Net assets
Beginning of period............... 75,639,074 177,274,800 255,332,603
- ------------------------------------------------------------------------------
End of period..................... $ 72,509,328 $216,348,921 $870,432,160
- ------------------------------------------------------------------------------
Undistributed (overdistributed)
net investment income............ $ 13,921 $ 6,634 $ (95,035)
- ------------------------------------------------------------------------------
</TABLE>
See Combined Notes to Financial Statements.
30
<PAGE>
EVERGREEN
State Municipal Bond Funds
Statements of Changes in Net Assets
Year Ended March 31, 1999
<TABLE>
<CAPTION>
Connecticut New Jersey Pennsylvania
Fund Fund Fund
- ------------------------------------------------------------------------------
<S> <C> <C> <C>
Operations
Net investment income.............. $ 3,068,565 $ 7,400,681 $ 10,561,862
Net realized gains on securities
and futures contracts............. 446,743 1,059,203 2,213,443
Net change in unrealized gains or
losses on securities and futures
contracts......................... 211,471 500,469 (103,155)
- ------------------------------------------------------------------------------
Net increase in net assets
resulting from operations........ 3,726,779 8,960,353 12,672,150
- ------------------------------------------------------------------------------
Distributions to shareholders from
Net investment income
Class A........................... (14,533) (1,503,706) (1,183,965)
Class B........................... (20,474) (599,178) (1,343,223)
Class C........................... 0 0 (232,806)
Class Y........................... (3,035,168) (5,302,623) (7,805,137)
Net realized gains
Class A........................... (3,518) (186,362) (354,194)
Class B........................... (7,346) (96,217) (459,774)
Class C........................... 0 0 (79,621)
Class Y........................... (648,594) (645,270) (2,122,788)
- ------------------------------------------------------------------------------
Total distributions to
shareholders..................... (3,729,633) (8,333,356) (13,581,508)
- ------------------------------------------------------------------------------
Capital share transactions
Proceeds from shares sold.......... 16,967,545 43,862,993 51,920,065
Net asset value of shares issued
in reinvestment of
distributions..................... 672,410 2,333,384 4,457,478
Payment for shares redeemed........ (10,150,268) (22,427,518) (40,292,580)
Net asset value of shares issued
in acquisitions................... 0 2,289,213 19,628,667
- ------------------------------------------------------------------------------
Net increase (decrease) in net
assets resulting from capital
share transactions............... 7,489,687 26,058,072 35,713,630
- ------------------------------------------------------------------------------
Total increase (decrease) in net
assets.......................... 7,486,833 26,685,069 34,804,272
Net assets
Beginning of period................ 68,152,241 150,589,731 220,528,331
- ------------------------------------------------------------------------------
End of period...................... $ 75,639,074 $177,274,800 $255,332,603
- ------------------------------------------------------------------------------
Undistributed (overdistributed)
net investment income............. $ (1,610) $ 3,635 $ (109,513)
</TABLE>
- --------------------------------------------------------------------------------
See Combined Notes to Financial Statements.
31
<PAGE>
Combined Notes to Financial Statements
1. ORGANIZATION
The Evergreen State Municipal Bond Funds consist of Evergreen Connecticut
Municipal Bond Fund ("Connecticut Fund"), Evergreen New Jersey Municipal Bond
Fund ("New Jersey Fund") and Evergreen Pennsylvania Municipal Bond Fund
("Pennsylvania Fund"), (collectively, the "Funds"). Each Fund is a non-
diversified series of Evergreen Municipal Trust (the "Trust"), a Delaware
business trust organized on September 18, 1997. The Trust is an open-end
management investment company registered under the Investment Company Act of
1940, as amended (the "1940 Act").
The Funds offer Class A, Class B, Class C and/or Class Y shares. Class A shares
are sold with a maximum front-end sales charge of 4.75%. Class B and Class C
shares are sold without a front-end sales charge, but pay a higher ongoing dis-
tribution fee than Class A. Class B shares are sold subject to a contingent de-
ferred sales charge that is payable upon redemption and decreases depending on
how long the shares have been held. Class B shares purchased after January 1,
1997 will automatically convert to Class A shares after seven years. Class B
shares purchased prior to January 1, 1997 follow the conversion rights at the
time the shares were purchased. Class C shares are sold subject to a 2.00% con-
tingent deferred sales charge payable on shares redeemed within one year after
the month of purchase and a 1.00% contingent deferred sales charge if such
shares are redeemed within two years after the month of purchase. Class C
shares purchased prior to February 1, 2000 follow the contingent deferred sales
charge schedule at the time the shares were initially purchased. Class Y shares
are sold at net asset value and are not subject to contingent deferred sales
charges or distribution fees. Class Y shares are sold only to investment advi-
sory clients of First Union Corporation ("First Union") and its affiliates,
certain institutional investors or Class Y shareholders of record of certain
other funds managed by First Union and its affiliates as of December 30, 1994.
2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies consistently fol-
lowed by the Funds in the preparation of their financial statements. The poli-
cies are in conformity with generally accepted accounting principles, which re-
quire management to make estimates and assumptions that affect amounts reported
herein. Actual results could differ from these estimates.
A. Valuation of Securities
An independent pricing service values each Fund's municipal bonds at fair value
using a variety of factors which may include yield, liquidity, interest rate
risk, credit quality, coupon, maturity and type of issue. Securities for which
valuations are not available from an independent pricing service may be valued
by brokers which use prices provided by market makers or estimates of market
value obtained from yield data relating to investments or securities with simi-
lar characteristics. Otherwise, securities for which valuations are not avail-
able from an independent pricing service (including restricted securities) are
valued at fair value as determined in good faith according to procedures estab-
lished by the Board of Trustees.
Mutual fund shares held in a Fund are valued at the net asset value of each mu-
tual fund.
Short-term investments with remaining maturities of 60 days or less are carried
at amortized cost, which approximates market value.
B. When-issued and Delayed Delivery Transactions
The Funds record when-issued or delayed delivery transactions on the trade date
and will segregate with the custodian qualifying assets having a value suffi-
cient to make payment for the securities purchased. Securities purchased on a
when-issued or delayed delivery basis are marked-to-market daily and the Fund
begins earning interest on the settlement date. Losses may arise due to changes
in the market value of the underlying securities or if the counterparty does
not perform under the contract.
32
<PAGE>
Combined Notes to Financial Statements (continued)
C. Security Transactions and Investment Income
Securities transactions are accounted for no later than one business day after
the trade date. Realized gains and losses are computed on the identified cost
basis. Interest income is recorded on the accrual basis and includes accretion
of discounts and amortization of premiums.
D. Federal Taxes
The Funds have qualified and intend to continue to qualify as regulated invest-
ment companies under the Internal Revenue Code of 1986, as amended (the
"Code"). Thus, the Funds will not incur any federal income tax liability since
they are expected to distribute all of their net investment company taxable in-
come net tax-exempt income and net capital gains, if any, to their sharehold-
ers. The Funds also intend to avoid any excise tax liability by making the re-
quired distributions under the Code. Accordingly, no provision for federal
taxes is required. To the extent that realized capital gains can be offset by
capital loss carryforwards, it is each Fund's policy not to distribute such
gains.
E. Distributions
Distributions from net investment income for the Funds are declared daily and
paid monthly. Distributions from net realized capital gains, if any, are paid
at least annually. Distributions to shareholders are recorded at the close of
business on the ex-dividend date.
Income and capital gains distributions to shareholders are determined in accor-
dance with income tax regulations, which may differ from generally accepted ac-
counting principles. To the extent these differences are permanent in nature,
such amounts are reclassified within the components of net assets.
F. Class Allocations
Income, expenses (other than class specific expenses) and realized and
unrealized gains and losses are prorated among the classes based on the rela-
tive net assets of each class. Currently, class specific expenses are limited
to expenses incurred under the Distribution Plans for each class.
3. INVESTMENT ADVISORY AGREEMENT AND OTHER AFFILIATED TRANSACTIONS
First Union National Bank ("FUNB"), a subsidiary of First Union, is the invest-
ment advisor to the Connecticut Fund and New Jersey Fund and is paid a manage-
ment fee that is computed and paid daily. The management fee for the Connecti-
cut Fund is computed at an annual rate of 0.52% of the Fund's average daily net
assets. Prior to January 3, 2000, the management fee for the Connecticut Fund
was computed at an annual rate of 0.60% of the Fund's average daily net assets.
The management fee for the New Jersey Fund is calculated by applying percentage
rates, starting at 0.42% and declining to 0.27% per annum as net assets in-
crease, to the Fund's average daily net assets. Prior to January 3, 2000, the
management fee for the New Jersey Fund was calculated by applying percentage
rates, starting at 0.50% and declining to 0.35% per annum as net assets in-
creased, to the Fund's average daily net assets.
Evergreen Investment Management Company ("EIMC"), an indirect wholly owned sub-
sidiary of First Union National Bank ("FUNB"), is the investment advisor for
the Pennsylvania Fund. In return for providing investment management services
to the Pennsylvania Fund, the Fund pays EIMC a management fee that is computed
and paid daily. The management fee is calculated by applying percentage rates,
starting at 0.46% and declining to 0.16% per annum as net assets increase, to
the Fund's average daily net assets. Prior to January 3, 2000, the management
fee for the Pennsylvania Fund was calculated by applying percentage rates,
starting at 0.55% and declining to 0.25% per annum as net assets increased, to
the Fund's average daily net assets.
33
<PAGE>
Combined Notes to Financial Statements (continued)
During the year ended March 31, 2000, the amount of investment advisory fees
waived by each investment advisor and the impact on each Fund's annualized ex-
pense ratio represented as a percentage of its average net assets were as fol-
lows:
<TABLE>
<CAPTION>
% of Average
Fees Daily
Waived Net Assets
---------------------
<S> <C> <C>
Connecticut Fund.......................... $ 92,329 0.13%
New Jersey Fund........................... 313,481 0.15%
</TABLE>
Evergreen Investment Services ("EIS"), an indirect, wholly-owned subsidiary of
First Union, is the administrator to the Funds. As administrator, EIS provides
the Funds with facilities, equipment and personnel. Prior to March 15, 2000,
The BISYS Group, Inc. ("BISYS") served as the sub-administrator to the Funds
and provided the officers of the Funds. Officers of the Funds and affiliated
Trustees receive no compensation directly from the Funds.
For its services, the Connecticut Fund and New Jersey Fund pay the administra-
tor a fee at the annual rate of 0.10% of each Fund's average daily net assets.
The sub-administrator was paid by the administrator out of its fees until the
sub-administration agreement with BISYS was terminated on March 14, 2000. Prior
to January 3, 2000, the administrator and sub-administrator for the Connecticut
Fund and New Jersey Fund were entitled to an annual fee based on the combined
average daily net assets of all the funds administered by EIS for which First
Union or its investment advisory subsidiaries are also the investment advisors.
The administration fee was calculated by applying percentage rates, which
started at 0.05% and declined to 0.01% per annum as net assets increased, to
the average daily net assets of each Fund. The sub-administration fee was cal-
culated by applying percentage rates, which started at 0.01% and declined to
0.004% per annum as net assets increased, to the average daily net assets of
each Fund.
For its services, the Pennsylvania Fund pays the administrator a fee at the an-
nual rate of 0.10% of its average daily net assets. Prior to January 3, 2000,
the administration fee was paid by the advisor and was not a fund expense. How-
ever, the Funds reimbursed EIMC for providing certain administration and ac-
counting expenses. The sub-administration fee was paid by the investment advi-
sor until the sub-administration agreement with BISYS was terminated.
During the year ended March 31, 2000, the Connecticut Fund and New Jersey Fund
paid or accrued the following amounts for administrative and sub-administrative
services:
<TABLE>
<CAPTION>
Administration Sub-administration
Fee Fee
---------------------------------
<S> <C> <C>
Connecticut Fund............. $27,423 $ 3,498
New Jersey Fund.............. 79,028 11,508
</TABLE>
Evergreen Service Company ("ESC"), an indirectly, wholly-owned subsidiary of
FUNB, serves as the transfer and dividend disbursing agent for the Funds.
4. DISTRIBUTION PLANS
Evergreen Distributor, Inc. ("EDI"), a wholly-owned subsidiary of BISYS, serves
as principal underwriter to the Funds.
Each Fund has adopted Distribution Plans, as allowed by Rule 12b-1 of the 1940
Act, for each class of shares, except Class Y. Distribution plans permit a Fund
to compensate its principal underwriter for costs related to selling shares of
the Fund and for various other services. These costs, which consist primarily
of commissions and service fees to broker-dealers who sell shares of the Fund,
are paid by the Fund through "Distribution Plan expenses". Under the Distribu-
tion Plans, Class A incurs distribution fees equal to 0.25% of the average
daily net asset of the class, all of which is used to pay for shareholder serv-
ice fees. Class B and Class C incur distribution fees equal to 1.00% of the av-
erage daily net assets of each class. Of this amount, 0.25% of the distribution
fees incurred is used to pay for shareholder service fees and 0.75% is used to
pay for distribution-related costs. Distribution Plan expenses are calculated
and paid daily.
34
<PAGE>
Combined Notes to Financial Statements(continued)
During the year ended March 31, 2000, amounts paid or accrued to EDI pursuant
to each Fund's Class A, Class B, and Class C Distribution Plans as well as dis-
tribution fees waived and the impact of the waiver as a percentage of the aver-
age net assets of the class were as follows:
<TABLE>
<CAPTION>
Fees % of Class A
Waived Average Net
Class A Class B Class C Class A Assets
---------------------------------------------
<S> <C> <C> <C> <C> <C>
Connecticut
Fund........... $ 1,763 $ 13,992 -- -- --
New Jersey
Fund........... 76,470 207,389 -- $47,032 0.16%
Pennsylvania
Fund........... 79,177 366,911 $65,280 -- --
</TABLE>
With respect to Class B and Class C shares, the principal underwriter may pay
distribution fees greater than the allowable annual amounts each Fund is per-
mitted to pay under the Distribution Plans.
Each of the Distribution Plans may be terminated at any time by vote of the In-
dependent Trustees or by vote of a majority of the outstanding voting shares of
the respective class.
5. ACQUISITIONS
On June 25, 1999, as a result of the conversion of common trust funds managed
by CoreStates Financial Corp., the New Jersey Fund and Pennsylvania Fund each
acquired substantially all the net assets of comparable common trusts in ex-
change for Class Y shares of the respective funds.
Effective on the close of business on July 27, 1998, the New Jersey Fund ac-
quired substantially all the assets and assumed certain liabilities of CoreFund
New Jersey Municipal Bond Fund in an exchange for Class A and Class Y shares of
New Jersey Fund. Also, the Pennsylvania Fund acquired substantially all the as-
sets and assumed certain liabilities of CoreFund Pennsylvania Municipal Bond
Fund in an exchange for Class A and Class Y shares of Pennsylvania Fund.
These conversions and acquisitions were accomplished by a tax-free exchange of
the respective shares of each Fund. The value of net assets acquired, number of
shares issued, unrealized appreciation acquired and the aggregate net assets of
each Fund immediately after the acquisition were as follows:
<TABLE>
<CAPTION>
Value of Net Number of Unrealized Net Assets
Acquiring Fund Acquired Fund Assets Acquired Shares Issued Appreciation After Acquisition
------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
New Jersey Fund Common Trust Fund $ 47,915,180 4,436,670 $ (1,033,417) $223,996,388
CoreFund New Jersey
Municipal Bond Fund 2,289,213 205,813 104,332 160,691,863
Pennsylvania Fund Common Trust Fund 667,273,557 59,201,637 (12,011,107) 922,757,172
CoreFund Pennsylvania
Municipal Bond Fund 19,628,667 1,676,246 443,113 242,223,339
</TABLE>
35
<PAGE>
Combined Notes to Financial Statements(continued)
6. CAPITAL SHARE TRANSACTIONS
The Funds have an unlimited number of shares of beneficial interest with $0.001
par value authorized. Shares of beneficial interest of the Funds are currently
divided into Class A, Class B, Class C and/or Class Y. Transactions in shares
of the Funds were as follows:
Connecticut Fund
<TABLE>
<CAPTION>
Year Ended Year Ended
March 31, 2000 March 31, 1999
------------------------ ----------------------
Shares Amount Shares Amount
- ------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class A
Shares sold................. 106,760 $ 656,854 134,138 $ 866,051
Shares issued in
reinvestment of
distributions.............. 2,402 14,585 1,796 11,544
Shares redeemed............. (74,680) (455,294) (69,560) (447,872)
- ------------------------------------------------------------------------------
Net increase................ 34,482 216,145 66,374 429,723
- ------------------------------------------------------------------------------
Class B
Shares sold................. 113,496 703,201 130,130 839,983
Shares issued in
reinvestment of
distributions.............. 5,539 33,611 2,852 18,307
Shares redeemed............. (75,158) (456,902) 0 0
- ------------------------------------------------------------------------------
Net increase................ 43,877 279,910 132,982 858,290
- ------------------------------------------------------------------------------
Class Y
Shares sold................. 2,210,525 13,450,801 2,378,864 15,261,511
Shares issued in
reinvestment of
distributions.............. 38,879 234,141 100,241 642,559
Shares redeemed............. (2,123,745) (12,906,775) (1,511,719) (9,702,396)
- ------------------------------------------------------------------------------
Net increase................ 125,659 778,167 967,386 6,201,674
- ------------------------------------------------------------------------------
Net increase................ $ 1,274,222 $7,489,687
</TABLE>
- --------------------------------------------------------------------------------
New Jersey Fund
<TABLE>
<CAPTION>
Year Ended Year Ended
March 31, 2000 March 31, 1999
------------------------ ------------------------
Shares Amount Shares Amount
- -------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class A
Shares sold................ 513,462 $ 5,471,875 471,657 $ 5,285,409
Automatic conversion of
Class B shares to Class A
shares.................... 13,772 142,552
Shares issued in
reinvestment of
distributions............. 89,772 954,868 93,355 1,046,688
Shares redeemed............ (947,781) (10,123,431) (469,865) (5,263,660)
Shares issued in
acquisition of CoreFund
New Jersey Municipal Bond
Fund...................... 0 0 74,925 833,392
- -------------------------------------------------------------------------------
Net increase (decrease).... (330,775) (3,554,136) 170,072 1,901,829
- -------------------------------------------------------------------------------
Class B
Shares sold................ 483,331 5,225,508 708,495 7,932,617
Shares issued in
reinvestment of
distributions............. 56,035 596,343 46,484 521,268
Automatic conversion of
Class B shares to Class A
shares.................... (13,772) (142,552)
Shares redeemed............ (466,917) (4,955,647) (173,473) (1,935,932)
- -------------------------------------------------------------------------------
Net increase............... 58,677 723,652 581,506 6,517,953
- -------------------------------------------------------------------------------
Class Y
Shares sold................ 3,554,144 37,901,483 2,736,002 30,644,967
Shares issued in
reinvestment of
distributions............. 57,872 612,425 68,267 765,428
Shares redeemed............ (3,016,740) (31,874,100) (1,358,173) (15,227,926)
Shares issued in
acquisition of:
Common Trust Fund.......... 4,436,670 47,915,180 0 0
CoreFund New Jersey
Municipal Bond Fund....... 0 0 130,888 1,455,821
- -------------------------------------------------------------------------------
Net increase............... 5,031,946 54,554,988 1,576,984 17,638,290
- -------------------------------------------------------------------------------
Net increase............... $ 51,724,504 $ 26,058,072
</TABLE>
- --------------------------------------------------------------------------------
36
<PAGE>
Combined Notes to Financial Statements (continued)
Pennsylvania Fund
<TABLE>
<CAPTION>
Year Ended Year Ended
March 31, 2000 March 31, 1999
------------------------- -------------------------
Shares Amount Shares Amount
- -------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class A
Shares sold.............. 1,951,256 $ 21,690,494 422,289 $ 4,962,719
Automatic conversion of
Class B shares to Class
A shares................ 10,624 113,974 0 0
Shares issued in
reinvestment of
distributions........... 76,879 772,835 73,831 866,664
Shares redeemed.......... (1,484,308) (16,315,550) (617,772) (7,248,653)
Shares issued in
acquisition of CoreFund
Pennsylvania............
Municipal Bond Fund..... 0 0 517,010 6,054,216
- -------------------------------------------------------------------------------
Net increase............. 554,451 6,261,753 395,358 4,634,946
- -------------------------------------------------------------------------------
Class B
Shares sold.............. 683,376 7,707,239 599,763 6,993,005
Shares redeemed.......... (768,838) (8,471,290) (617,387) (7,159,590)
Shares issued in
reinvestment of
distributions........... 85,068 931,987 94,274 1,092,986
Automatic conversion of
Class B shares to Class
A shares................ (10,719) (113,974) 0 0
- -------------------------------------------------------------------------------
Net increase (decrease).. (11,113) 53,962 76,650 926,401
- -------------------------------------------------------------------------------
Class C
Shares sold.............. 48,560 569,348 82,623 962,589
Shares issued in
reinvestment of
distributions........... 16,711 183,853 18,631 216,583
Shares redeemed.......... (137,215) (1,503,074) (53,731) (622,506)
- -------------------------------------------------------------------------------
Net increase (decrease).. (71,944) (749,873) 47,523 556,666
- -------------------------------------------------------------------------------
Class Y
Shares sold.............. 14,330,293 157,620,236 3,324,052 39,001,752
Shares issued in
reinvestment of
distributions........... 68,152 750,286 195,060 2,281,245
Shares redeemed.......... (16,066,843) (175,887,724) (2,151,154) (25,261,831)
Shares issued in
acquisition of:
Common Trust Fund....... 59,201,637 667,273,557 0 0
CoreFund Pennsylvania
Municipal Bond Fund.... 0 0 1,159,236 13,574,451
- -------------------------------------------------------------------------------
Net increase............. 57,533,239 649,756,355 2,527,194 29,595,617
- -------------------------------------------------------------------------------
Net increase............. $655,322,197 $ 35,713,630
</TABLE>
- --------------------------------------------------------------------------------
7. SECURITIES TRANSACTIONS
Cost of purchases and proceeds from sales of investment securities (excluding
short-term securities) were as follows for the year ended March 31, 2000:
<TABLE>
<CAPTION>
Cost of Purchases Proceeds from Sales
-------------------------------------
<S> <C> <C>
Connecticut Fund.......... $ 61,360,899 $ 60,182,880
New Jersey Fund........... 149,040,833 113,180,556
Pennsylvania Fund......... 202,400,250 220,972,026
</TABLE>
On March 31, 2000, the composition of unrealized appreciation and depreciation
on securities based on the aggregate cost of securities for federal income tax
purposes were as follows:
<TABLE>
<CAPTION>
Gross Gross Net Unrealized
Unrealized Unrealized Appreciation
Tax Cost Appreciation Depreciation (Depreciation)
------------------------------------------------------
<S> <C> <C> <C> <C>
Connecticut
Fund........... $ 72,917,014 $ 792,085 $ (1,104,863) $ (312,778)
New Jersey
Fund........... 212,983,139 3,332,364 (3,141,459) 190,905
Pennsylvania
Fund........... 864,410,848 18,700,252 (20,670,910) (1,970,658)
</TABLE>
As of March 31, 2000, Connecticut Fund, New Jersey Fund and Pennsylvania Fund
had respective capital loss carryovers for federal income tax purposes of
$527,818, 1,004,794 and $3,935,444 which expire on March 31, 2008.
In addition to the capital loss carryovers, capital losses incurred after Octo-
ber 31 within a Fund's fiscal year end are deemed to arise on the first busi-
ness day of the fund's following fiscal year. For the fiscal year ended March
31, 2000, the Connecticut Fund, New Jersey Fund and Pennsylvania Fund incurred
and elected to defer $1,207,273, $4,160,367 and $13,329,151, respectively, of
capital losses.
37
<PAGE>
Combined Notes to Financial Statements (continued)
8. EXPENSE REDUCTIONS
The Funds have entered into expense offset arrangements with ESC and their cus-
todian whereby credits realized as a result of uninvested cash balances were
used to reduce a portion of each Fund's related expenses. The assets deposited
with ESC and the custodian under these expense offset arrangements could have
been invested in income-producing assets. The amount of expense reductions re-
ceived by each Fund and the impact of the total expense reductions on each
Fund's expense ratio represented as a percentage of its average net assets were
as follows:
<TABLE>
<CAPTION>
Total Expense
Reductions % of Average
Received Daily Net Assets
------------------------------
<S> <C> <C>
Connecticut Fund................. $ 2,515 0.00%
New Jersey Fund.................. 8,971 0.00%
Pennsylvania Fund................ 34,474 0.00%
</TABLE>
9. DEFERRED TRUSTEES' FEES
Each Independent Trustee of each Fund may defer any or all compensation related
to performance of their duties as Trustee. The Trustees' deferred balances are
allocated to deferral accounts, which are included in the accrued expenses for
the Fund. The investment performance of the deferral accounts are based on the
investment performance of certain Evergreen Funds. Any gains earned or losses
incurred in the deferral accounts are reported in the Fund's Trustees' fees and
expenses. At the election of the Trustees, the deferral account will be paid
either in one lump sum or in quarterly installments for up to ten years.
10. FINANCING AGREEMENTS
Certain Evergreen Funds, State Street Bank and Trust Company ("State Street")
and The Bank of New York ("BONY") entered into an amended financing agreement
on December 22, 1998. Under this agreement, State Street and BONY provided an
unsecured credit facility in the aggregate amount of $150 million ($125 million
committed and $25 million uncommitted). The credit facility was allocated, un-
der the terms of the financing agreement between State Street and BONY. The
credit facility was accessed by the Funds for temporary or emergency purposes
only and was subject to each Fund's borrowing restrictions. Borrowings under
this facility bore interest at 0.50% per annum above the Federal Funds rate. A
commitment fee of 0.065% per annum was incurred on the unused portion of the
committed facility, which was allocated to all funds. State Street served as
administrative agent and was entitled to a fee of $20,000 per annum which was
allocated to all of the funds. This agreement was terminated on July 27, 1999.
On July 27, 1999, certain Evergreen Funds and a group of banks (the "lenders")
entered into a credit agreement. Under this agreement, the Lenders provide an
unsecured revolving credit commitment in the aggregate amount of $1.050 bil-
lion. The credit facility is allocated, under the terms of the financing agree-
ment, among the Lenders. The credit facility is accessed by the Funds for tem-
porary or emergency purposes to fund the redemption of their shares or for gen-
eral working capital purposes as permitted by each Fund's borrowing restric-
tions. Borrowings under this facility bear interest at 0.75% per annum above
the Federal Funds rate (1.50% per annum above the Federal Funds rate during the
period from and including December 1, 1999 through and including January 31,
2000). A commitment fee of 0.10% per annum is incurred on the average daily un-
used portion of the revolving credit commitment. The commitment fee is allo-
cated to all funds. For its assistance in arranging this financing agreement,
First Union Capital Markets Corp. was paid a one-time arrangement fee of
$250,000. State Street serves as paying agent for the funds and as paying agent
is entitled to a fee of $20,000 per annum which is allocated to all the funds.
During the year ended March 31, 2000 the Pennsylvania Fund had average
borrowings outstanding of $27,712 at a rate of 6.45% and paid interest of
$1,826.
38
<PAGE>
Combined Notes to Financial Statements (continued)
11. CONCENTRATION OF CREDIT RISK
Each Fund invests a substantial portion of its assets in issuers of municipal
debt securities located in a single state, therefore, it may be more affected
by economic and political developments in that state or region than would be a
comparable general tax-exempt mutual fund.
39
<PAGE>
INDEPENDENT AUDITORS' REPORT
Board of Trustees and Shareholders
Evergreen Municipal Trust
We have audited the accompanying statements of assets and liabilities, in-
cluding the schedules of investments of the Evergreen Connecticut Municipal
Bond Fund, Evergreen New Jersey Municipal Bond Fund and Evergreen Pennsylvania
Municipal Bond Fund, portfolios of Evergreen Municipal Trust, as of March 31,
2000, and the related statements of operations for the year then ended, state-
ments of changes in net assets for each of the years in the two-year period
then ended and the financial highlights for each of the years or periods in the
five-year period then ended. These financial statements and financial high-
lights are the responsibility of the Funds' management. Our responsibility is
to express an opinion on these financial statements and financial highlights
based on our audits.
We conducted our audits in accordance with auditing standards generally ac-
cepted in the United States of America. Those standards require that we plan
and perform our audit to obtain reasonable assurance about whether the finan-
cial statements and financial highlights are free of material misstatement. An
audit includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. Our procedures included confirmation
of securities owned as of March 31, 2000 by correspondence with the custodian
and brokers. An audit also includes assessing the accounting principles used
and significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a reason-
able basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of Ever-
green Connecticut Municipal Bond Fund, Evergreen New Jersey Municipal Bond Fund
and Evergreen Pennsylvania Municipal Bond Fund as of March 31, 2000, the re-
sults of their operations, changes in their net assets and financial highlights
for each of the years or periods described above in conformity with accounting
principles generally accepted in the United States of America.
/s/KPMG LLP
Boston, Massachusetts
May 5, 2000
40
<PAGE>
Additional Information (Unaudited)
FEDERAL INCOME TAX STATUS OF DISTRIBUTIONS
For the fiscal period ended March 31, 2000, the following percentages represent
the portion of dividends from net investment income which are exempt from fed-
eral income tax, other than alternative minimum tax:
<TABLE>
<S> <C>
Connecticut Fund.......................................... 99.85%
New Jersey Fund........................................... 99.82%
Pennsylvania Fund......................................... 99.72%
</TABLE>
Pursuant to section 852 of the Internal Revenue Code, the Funds have designated
the following amounts as long-term capital gain distributions for the fiscal
year ended March 31, 2000:
<TABLE>
<CAPTION>
Fund Aggregate Per Share
----------------------------------------------------------------
<S> <C> <C>
Connecticut Fund............................ $ 29,424 $0.002
New Jersey Fund............................. 285,123 0.013
Pennsylvania Fund........................... 290,406 0.004
</TABLE>
Shareholders are advised to use information received on Form 1099 to determine
their taxable long-term capi-tal gain distributions rather than the per share
amounts presented above.
41
<PAGE>
Evergreen Funds
Money Market
Treasury Money Market Fund
Money Market Fund
Municipal Money Market Fund
Florida Municipal Money Market Fund
New Jersey Municipal Money Market Fund
Pennsylvania Municipal Money Market Fund
Tax Advantaged
Short Intermediate Municipal Bond Fund
High Grade Municipal Bond Fund
Municipal Bond Fund
Connecticut Municipal Bond Fund
Florida Municipal Bond Fund
Florida High Income Municipal Bond Fund
Georgia Municipal Bond Fund
Maryland Municipal Bond Fund
New Jersey Municipal Bond Fund
North Carolina Municipal Bond Fund
Pennsylvania Municipal Bond Fund
South Carolina Municipal Bond Fund
Virginia Municipal Bond Fund
Tax-Free High Income Fund
Income
Short-Duration Income Fund
Intermediate Term Bond Fund
U.S. Government Fund
Quality Income Fund
Diversified Bond Fund
Strategic Income Fund
High Yield Bond Fund
Balanced
Tax Strategic Foundation Fund
Foundation Fund
Balanced Fund
Growth & Income
Utility Fund
Income and Growth Fund
Value Fund
Blue Chip Fund
Growth and Income Fund
Small Cap Value Fund
Select Equity Index Fund
Domestic Growth
Tax Strategic Equity Fund
Capital Growth Fund
Stock Selector Fund
Evergreen Fund
Strategic Growth Fund
Masters Fund
Omega Fund
Small Company Growth Fund
Growth Fund
Aggressive Growth Fund
Select Special Equity Fund
Global International
Global Leaders Fund
Perpetual Global Fund
International Growth Fund
Perpetual International Fund
Global Opportunities Fund
Precious Metals Fund
Emerging Markets Growth Fund
Latin America Fund
Express Line
800.346.3858
Investor Services
800.343.2898
www.evergreen-funds.com
64378 543688 5/2000
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[LOGO OF EVERGREEN FUNDS] PRSRT STD
U.S.
200 Berkeley Street POSTAGE
Boston,MA 02116 PAID
HUDSON, MA
PERMIT NO. 19
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