<PAGE> 1
VANGUARD(R)
MUNICIPAL BOND
FUNDS
Annual Report
October 31, 1999
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VANGUARD TAX-EXEMPT
MONEY MARKET FUND
VANGUARD SHORT-TERM
TAX-EXEMPT FUND
VANGUARD LIMITED-TERM
TAX-EXEMPT FUND
VANGUARD INTERMEDIATE-TERM
TAX-EXEMPT FUND
VANGUARD INSURED LONG-TERM
TAX-EXEMPT FUND
VANGUARD LONG-TERM
TAX-EXEMPT FUND
VANGUARD HIGH-YIELD
TAX-EXEMPT FUND
[PHOTO]
[MEMBERS OF THE VANGUARD GROUP(R) LOGO]
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[PHOTO]
JOHN C. BOGLE
FELLOW SHAREHOLDERS:
Two roads diverged in a wood, and I--I took the one less traveled by, and
that has made all the difference.
I can think of no better words than those of Robert Frost to begin this special
letter to our shareholders, who have placed such extraordinary trust in me and
in Vanguard over the past quarter century. When the firm was founded 25 years
ago, we deliberately took a new road to managing a mutual fund enterprise.
Instead of having the funds controlled by an outside management company with its
own financial interests, the Vanguard funds--there were only 11 of them
then--would be controlled by their own shareholders and operate solely in their
financial interests. The outcome of our unprecedented decision was by no means
certain. We described it then as "The Vanguard Experiment."
Well, I guess it's fair to say it's an experiment no more. During the past
25 years, the assets we hold in stewardship for investors have grown from $1
billion to more than $500 billion, and I believe that our reputation for
integrity, fair-dealing, and sound investment principles is second to none in
this industry. Our staggering growth--which I never sought-- has come in
important part as a result of the simple investment ideas and basic human values
that are the foundation of my personal philosophy. I have every confidence that
they will long endure at Vanguard, for they are the right ideas and right
values, unshakable and eternal.
While Emerson believed that "an institution is the lengthened shadow of one
man," Vanguard today is far greater than any individual. The Vanguard crew has
splendidly implemented and enthusiastically supported our founding ideas and
values, and deserves the credit for a vital role in forging our success over the
years. It is a dedicated crew of fine human beings, working together in an
organization that is well prepared to press on regardless long after I am gone.
Creating and leading this enterprise has been an exhilarating run. Through it
all, I've taken the kudos and the blows alike, enjoying every moment to the
fullest, and even getting a second chance at life with a heart transplant three
years ago. What more could a man ask?
While I shall no longer be serving on the Vanguard Board, I want to assure
you that I will remain vigorous and active in a newly created Vanguard unit,
researching the financial markets, writing, and speaking. I'll continue to focus
whatever intellectual power and ethical strength I possess on my mission to
assure that mutual fund investors everywhere receive a fair shake. In the spirit
of Robert Frost:
But I have promises to keep, and miles to go before I sleep, and miles to
go before I sleep.
You have given me your loyalty and friendship over these long years, and I
deeply appreciate your thousands of letters of support. For my part, I will
continue to keep an eagle eye on your interests, for you deserve no less. May
God bless you all, always.
/s/ JCB
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CONTENTS
REPORT FROM THE CHAIRMAN 1
THE MARKETS IN PERSPECTIVE 6
REPORT FROM THE ADVISER 8
FUND PROFILES 10
PERFORMANCE SUMMARIES 18
FINANCIAL STATEMENTS 25
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REPORT FROM THE CHAIRMAN
[PHOTO]
JOHN J. BRENNAN
Inflation worries upset the bond market during the 12 months ended October 31,
1999, the fiscal year for the Vanguard Municipal Bond Funds. Bond returns were
the lowest in five years, with long-term bonds hardest hit. Despite this
difficult environment, six of our seven funds outperformed its average peer.
However, only three of the funds provided positive total returns (capital change
plus reinvested dividends) for the year. The others recorded negative returns
because falling bond prices more than offset their interest income. The adjacent
table breaks each fund's total return into its income and capital components. It
also presents each fund's yield as of October 31.
<TABLE>
<CAPTION>
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COMPONENTS OF TOTAL RETURNS
FISCAL YEAR ENDED OCTOBER 31, 1999
---------------------------------- SEC
TOTAL INCOME CAPITAL ANNUALIZED
TAX-EXEMPT FUND RETURN RETURN RETURN YIELD*
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<S> <C> <C> <C> <C>
Money Market** 3.1% 3.1% 0.0% 3.27%
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Short-Term 2.7% 3.7% -1.0% 3.80%
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Limited-Term 1.8% 4.2% -2.4% 4.28%
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Intermediate-Term -0.4% 4.8% -5.2% 4.84%
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Insured Long-Term -2.7% 5.0% -7.7% 5.22%
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Long-Term -3.5% 4.8% -8.3% 5.29%
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High-Yield -2.8% 5.0% -7.8% 5.51%
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</TABLE>
* 7-day yield for the Tax-Exempt Money Market Fund; 30-day yield for other
funds.
** An investment in a money market fund is not insured nor guaranteed by the
Federal Deposit Insurance Corporation or any other government agency.
Although the fund seeks to preserve the value of your investment at $1
per share, it is possible to lose money by investing in the fund.
The table on page 2 shows how our funds' returns for fiscal 1999 compared
with those of competing funds. And in a table following this letter, we present
each fund's net asset value at the beginning and end of the fiscal year, along
with the per-share amount of income dividends and any distribution from net
realized capital gains. The Performance Summaries on pages 18 through 24 show
the returns of each fund for various periods, compared with an appropriate
unmanaged index.
FINANCIAL MARKETS IN REVIEW
When the fiscal year began, interest rates were still near the lows reached in
early October 1998, and bond investors were basking in an environment that
featured both low inflation and solid expansion in economic activity. But a few
months later, investors were increasingly focused on the possibility that the
continuing strength of the U.S. economy, coupled with renewed growth in overseas
economies, would cause the prices of goods and services to rise significantly.
These inflation fears and a weakening dollar helped to push bond yields
higher and bond prices lower. The Federal Reserve Board, after cutting
short-term interest rates by a total of 0.75 percentage point in autumn 1998,
switched direction and boosted short-term rates by 0.25 percentage point in both
June and August 1999. The market had acted before the Fed, pushing rates higher
across the maturity spectrum. On balance, the yield of the 30-year U.S. Treasury
bond moved up 100 basis points (1 percentage point) to end the period at 6.16%,
while the 10-year Treasury's yield jumped 141 basis points to 6.02%, and the
3-month Treasury bill's yield rose 0.77 percentage point to 5.09%.
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Bond prices move in the opposite direction from interest rates, so higher
rates caused the prices of existing bonds to fall. The Lehman Brothers Aggregate
Bond Index, a proxy for the taxable investment-grade portion of the U.S. bond
market, provided a meager 12-month total return of 0.5%. Inflation, as measured
by the Consumer Price Index, was 2.6% during our fiscal year. Although this was
a moderate pace by historical standards, it was above the 1.5% inflation rate
experienced during our previous fiscal year. For most bond investors, returns
failed to outrun inflation.
Municipal bond prices also suffered from the general rise in interest
rates, although the damage was less severe than for Treasury securities. The
Lehman Brothers Municipal Bond Index, a proxy for high-grade tax-exempt issues
that has an intermediate average maturity, had a total return of -1.8%,
consisting of a 4.2% return from income and a -6.0% price decline. In
comparison, the Lehman 5-10 Year U.S. Treasury Index had a total return of
- -3.1%, as a 6.0% income return was overcome by a -9.1% price decline. The
somewhat better performance of municipal bonds led to a widening of the spread
between tax-exempt and Treasury yields.
At the outset of the period, high-grade long-term municipal bonds
provided roughly 95% of the yield of the benchmark 30-year U.S. Treasury bond--a
remarkable fact, given that the former deliver tax-exempt income, while
Treasuries are subject to federal income taxes at rates as high as 39.6%. The
yield on long-term municipals rose 95 basis points on balance to 6.08% from
5.13% at the beginning of the fiscal year. Yields on high-quality, short-term
municipal securities ended the period at 3.80%, up 92 basis points from 2.88% at
the end of last October. For investors in the maximum marginal tax bracket,
tax-exempt yields of 6.08% and 3.80% are equivalent to yields of 10.07% and
6.29%, respectively, on taxable bonds with the same maturities.
While bond prices withered, the U.S. stock market continued its assault on
the record books. During the 12 months ended October 31, the Wilshire 5000 Total
Market Index, a proxy for all domestic stocks, gained 25.7%. Virtually all of
the gains came in the first half of the fiscal year, before rising interest
rates dampened investor enthusiasm.
FISCAL 1999 PERFORMANCE OVERVIEW
The table below shows the total return of each of the Vanguard Municipal Bond
Funds in relation to the average return for funds with comparable credit quality
and average maturities. All but one of our funds surpassed their real-world
competitors, with margins ranging from 0.2 percentage point (for our High-Yield
Tax-Exempt Fund) to 1.7 percentage points (for our Insured Long-Term Tax-Exempt
Fund). However, as shown in the Performance Summaries, five of our funds lagged
their unmanaged benchmark indexes during the fiscal year. The indexes are tough
competitors because they exist only on paper and incur no operating or
transaction costs, which all real portfolios bear to one degree or another. Our
Short-Term Tax-Exempt Fund beat its index benchmark largely because the average
maturity of its holdings was shorter
<TABLE>
<CAPTION>
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TOTAL RETURNS
FISCAL YEAR ENDED OCTOBER 31, 1999
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AVERAGE
VANGUARD COMPETING
TAX-EXEMPT FUND FUND FUND* DIFFERENCE
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<S> <C> <C> <C>
Money Market 3.1% 2.6% +0.5%
Short-Term 2.7 2.7** 0.0
Limited-Term 1.8 1.2 +0.6
Intermediate-Term -0.4 -1.5 +1.1
Insured Long-Term -2.7 -4.4 +1.7
Long-Term -3.5 -4.2 +0.7
High-Yield -2.8 -3.0 +0.2
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</TABLE>
* Derived from data provided by Lipper Inc.
** Adjusted to exclude funds with a dollar-weighted average maturity greater
than 2 years as of September 30, 1999.
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than that of the index--making the fund's share price less sensitive than the
index to interest rate fluctuations. The Tax-Exempt Money Market Fund maintained
its share price of $1, as is expected but not guaranteed.
Operating expenses directly reduce the income that bond funds pay to their
shareholders. Although these costs put all funds at a disadvantage versus their
index benchmarks, the Vanguard funds remain well ahead of our competitors in
this regard. Our low operating costs mean that more of our funds' interest
income is passed along in dividends to shareholders. The Vanguard Municipal Bond
Funds had expense ratios--annual operating expenses as a percentage of average
net assets--of either 0.18% or 0.19% during the fiscal year, far below the
expense ratios charged by the average funds in their peer groups. Expenses
charged by our peers averaged from 0.69% (for tax-exempt money market funds) to
1.16% (for high-yield funds), according to data from Lipper Inc. Obviously, cost
matters.
Our other key competitive weapon is Vanguard's Fixed Income Group, which
advises our funds. The group carefully scrutinizes the credit quality of each
potential investment before committing your money, and its managers ensure that
each fund stays within its stated maturity guidelines. They serve you very well.
LONG-TERM PERFORMANCE OVERVIEW
During the decade of the 1990s, the bond market amply demonstrated the fact that
bond prices are volatile. Rising interest rates depressed bond prices in our
funds' fiscal years 1990, 1994, 1996, and 1999. On the other hand, falling rates
boosted prices in the six other years. These short-term fluctuations in bond
prices largely offset each other over the full decade. The result, as is typical
over long periods, was that interest income, rather than capital gains or
losses, was the dominant factor in the total return from bonds. That said, our
longer-term funds enjoyed a slight tailwind during the decade because interest
rates declined modestly, on balance, over the period.
The table at right presents the ten- year records of the Vanguard Municipal
Bond Funds. It presents the average annual returns for the funds and their peer
groups, as well as the results of hypothetical $10,000 investments in each fund,
assuming the reinvestment of all dividends and capital gains distributions. I'm
pleased to report that six of the funds outperformed their average peers during
the decade by annual margins ranging from 0.4 percentage point to 1 percentage
point. Our seventh fund, the Short-Term Tax-Exempt Fund, finished in a dead heat
with its average peer fund, returning an average of 4.5% annually. As the table
shows, even small differences in annual returns
<TABLE>
<CAPTION>
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TOTAL RETURNS
10 YEARS ENDED OCTOBER 31, 1999
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AVERAGE FINAL VALUE OF
ANNUAL A $10,000
RETURN INITIAL INVESTMENT*
-----------------------------------------------------------------
AVERAGE AVERAGE
VANGUARD COMPETING VANGUARD COMPETING VANGUARD
TAX-EXEMPT FUND FUND FUND FUND FUND ADVANTAGE
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<S> <C> <C> <C> <C> <C>
Money Market 3.6% 3.2% $14,259 $13,675 $ 584
Short-Term 4.5 4.5 15,583 15,511 72**
Limited-Term 5.5 4.9 17,056 16,189 867
Intermediate-Term 6.9 6.0 19,439 17,831 1,608
Insured Long-Term 7.1 6.1 19,772 18,089 1,683
Long-Term 7.2 6.2 20,093 18,320 1,773
High-Yield 7.4 6.4 20,347 18,570 1,777
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</TABLE>
*Assuming reinvestment of all income dividends and capital gains distributions.
**Difference due to rounding of returns.
3
<PAGE> 6
result in substantial differences in earnings over a ten-year period. On $10,000
investments made a decade ago, our margins of superiority over other funds
amounted to extra earnings of as much as $1,700 (or 17% of the initial
investment). In reality, our margins were even wider, because some tax-exempt
bond funds carry sales loads that are not factored into the return calculations
for the peer groups.
In comparison with their unmanaged index benchmarks, our funds had mixed
results during the past decade. Three of our funds topped their indexes, while
two trailed and one stayed even. The fact that our funds so closely tracked the
indexes was a notable achievement given that the indexes don't bear the
operating, advisory, or transaction costs that all mutual funds incur.
No one knows what absolute returns the municipal bond market will provide
in the future. I am confident, however, that our low costs and sound management
will enable our tax-exempt funds to continue providing returns that exceed those
provided by our peer groups.
IN SUMMARY
The returns of bonds and stocks diverged sharply during the 12 months ended
October 31. Though this divergence was unsettling to some bond investors, it
should not be considered unusual. The fact is, individual securities,
industries, and entire asset classes sometimes struggle while others shine.
Because of such divergences and the unpredictable nature of the financial
markets, we firmly believe in diversified investment programs, which have
exposure to the different asset classes as well as to a variety of issues within
each class. Such a balanced approach is the surest road to long-term investing
success. Creating a program tailored to your objectives, time horizon for
investing, and tolerance for risk--and sticking with it through good times and
bad--allows you to participate in the rewards of the financial markets while
limiting the risk.
/s/ JOHN J. BRENNAN
John J. Brennan
Chairman and Chief Executive Officer
November 15, 1999
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A NOTE OF THANKS TO OUR FOUNDER
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As you may have read on the inside cover of our report, our founder, John C.
Bogle, is retiring December 31, 1999, as Senior Chairman of our Board after
nearly 25 years of devoted service to Vanguard and our shareholders. Vanguard
investors have Jack to thank for creating a truly mutual mutual fund company
that operates solely in the interest of its fund shareholders. And mutual fund
investors everywhere have benefited from his energetic efforts to improve this
industry. Finally, on a personal note, I am forever grateful to Jack for giving
me the opportunity to join this great company in 1982.
4
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<TABLE>
<CAPTION>
FUND STATISTICS
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NET ASSET VALUE
PER SHARE TWELVE MONTHS
------------------------------------------- ----------------------------------
OCTOBER 31, OCTOBER 31, INCOME CAPITAL
TAX-EXEMPT FUND 1998 1999 DIVIDENDS GAINS*
- ----------------- ---------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Money Market 1.00 1.00 $0.030 $0.000
Short-Term 15.65 15.48 0.578 0.006
Limited-Term 10.85 10.59 0.457 0.000
Intermediate-Term 13.52 12.79 0.648 0.035
Insured Long-Term 12.73 11.69 0.644 0.069
Long-Term 11.39 10.34 0.565 0.115
High-Yield 11.06 10.13 0.571 0.072
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</TABLE>
*Includes long-term and short-term capital gains distributions.
5
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THE MARKETS IN PERSPECTIVE
YEAR ENDED OCTOBER 31, 1999
Caution followed exuberance in the U.S. stock market during the fiscal year
ended October 31, 1999. Improving economic conditions during the first half
of the year set off a raucous rally from the lows of summer 1998, when fears of
a global economic slump swept world markets. However, during the second half of
the fiscal year, interest rates kept rising, pulling down bond prices and
tempering the stock market's optimism. The notion of a global slump was replaced
by worries that economic growth might be so strong as to threaten a surge in
inflation.
U.S. STOCK MARKETS
A booming U.S. economy and solid increases in corporate earnings lifted the U.S.
stock market, especially during the first half of the fiscal year. The nation's
economic output increased by about 4% during the year. Consumer spending, which
accounts for roughly two-thirds of economic activity, powered the expansion.
Americans spent virtually every dollar they earned, encouraged by rising wealth
from a long bull market, plentiful employment, and rising incomes. (After-tax
personal income rose about 5% during the year; unemployment fell to a 30-year
low of 4.1% of the workforce in October.)
<TABLE>
<CAPTION>
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AVERAGE ANNUAL RETURNS
PERIODS ENDED OCTOBER 31, 1999
-----------------------------------
1 YEAR 3 YEARS 5 YEARS
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
STOCKS
S&P 500 Index 25.7% 26.5% 26.0%
Russell 2000 Index 14.9 9.4 12.6
Wilshire 5000 Index 25.7 23.8 23.8
MSCI EAFE Index 23.4 12.5 9.5
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BONDS
Lehman Aggregate Bond Index 0.5% 6.2% 7.9%
Lehman 10 Year Municipal Bond Index -1.2 5.2 7.0
Salomon Smith Barney 3-Month
U.S. Treasury Bill Index 4.6 5.0 5.2
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OTHER
Consumer Price Index 2.6% 2.0% 2.4%
- --------------------------------------------------------------------------------
</TABLE>
From October 31, 1998, through April 30, 1999, the stock market rose 22.8%,
as measured by the Wilshire 5000 Total Market Index. Investor confidence,
already high due to the booming economy, was bolstered by easier monetary
policy--the Federal Reserve cut short-term interest rates in November 1998 for
the third time in less than two months. But by summer, the Fed reversed course,
twice boosting its target for short-term interest rates to slow the economy and
reduce inflationary pressures.
Higher interest rates helped take the steam out of the stock market's rally
during the second half of the fiscal year, even though estimates of corporate
earnings kept rising. Higher rates tend to hurt stocks because many investors
use current interest rates to discount the value of a stock's projected earnings
and dividends. The higher the rate, the more future earnings are discounted, and
the less investors will pay for the stock now. After a second-half gain of 2.3%,
the Wilshire 5000 Index recorded a 25.7% return for the full fiscal year.
Big stocks outperformed small stocks in fiscal 1999, and growth stocks
outpaced value stocks. The S&P 500 Index, which is dominated by large-
capitalization stocks, gained
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25.7%, while the small-cap Russell 2000 Index was up 14.9%. Growth stocks--whose
high prices in relation to earnings, book value, and dividends indicate high
expectations for future growth--lost none of their appeal, despite soaring
valuations for many. Both large- and small-cap growth issues gained roughly 30%,
while value stocks within the S&P 500 Index were up 19.0%, and the Russell
2000's value stocks had a scant 0.7% return.
The growth/value gap was due partly to the incredible performance of
technology stocks, most of which are classified as growth issues. Within the S&P
500 Index, tech stocks gained 67% during the fiscal year. Advances of about 30%
were recorded by retailers and other consumer-discretionary stocks and by the
utilities sector, where gains were concentrated in telecommunications stocks.
The only sector with a loss was consumer staples (-8%), where food and beverage
company stocks suffered from falling profits. Other laggards were the auto &
transportation sector (+6%) and health-care stocks (+9%).
U.S. BOND MARKETS
Rapid economic growth was a help to the stock market but a hindrance to bonds.
Investors worried that, with unemployment so low, growth above the 2.5% to 3%
range would cause wages and prices to accelerate. Indeed, inflation did rise a
bit, although the Consumer Price Index was up a relatively modest 2.6% during
the 12-month period.
As mentioned, the Fed sought to combat inflationary pressures by increasing
short-term interest rates by a quarter-point on June 30 and again on August 24.
The bond market was already pushing up rates well before the Fed acted. Yields
of long-term U.S. Treasury bonds began rising significantly in February. By
fiscal year-end, the 30-year Treasury bond's yield was 6.16%, up precisely 1
percentage point for the year. The 10-year Treasury's yield rose 1.41 percentage
points, from 4.61% to 6.02%. Short-term interest rates didn't rise as far, and
3-month Treasury bill yields were up 0.77 point to 5.09% at fiscal year-end.
Rising interest rates mean lower prices for existing bonds, of course.
Price declines were higher for longer-term bonds, which are most sensitive to
changing rates. For the taxable bond market as a whole, as measured by the
Lehman Aggregate Bond Index, prices fell -5.7%, resulting in a total return of
just 0.5% for the fiscal year. High-yield (junk) bonds and mortgage-backed
securities posted higher returns than Treasuries.
INTERNATIONAL STOCK MARKETS
International markets soared in local currencies during the 12 months ended
October 31, with European stocks gaining 22.7% and Pacific-region stocks
advancing 37.8%. The U.S. dollar rose in value against most European currencies
but fell against the Japanese yen. For U.S. investors, the upshot of these
currency fluctuations was to trim returns from Europe to 12.7% in dollar terms
and to boost returns from the Pacific to 50.5%.
In the major developed international markets, U.S. investors earned 23.4%,
as measured by the Morgan Stanley Capital International Europe, Australasia, Far
East (EAFE) Index. The bull markets in most nations stemmed from a renewed
appetite for risk on the part of investors encouraged by clear signs of
expanding business activity and generally easier monetary policy. Japan and the
rest of Asia, which were hit hardest by currency and economic crises in 1997 and
1998, saw the biggest gains. In Japan, massive government spending programs
appeared to be working--at least in the short run--to lift that nation out of a
recession.
Emerging markets, as measured by the Select Emerging Markets Free Index,
gained 34.1% for U.S. investors, as local returns of better than 70% were cut
nearly in half by weaker currencies in Latin America and eastern Europe.
7
<PAGE> 10
REPORT FROM THE ADVISER
The year ended October 31, 1999, our last fiscal year of the century, was an
eventful 12 months. When the period began, economic instability in developing
countries was still fresh in investors' minds. As part of a worldwide effort by
central bankers to allay fears of a global economic slide, the Federal Reserve
Board lowered short-term interest rates during autumn 1998 by a total of 0.75
percentage point. These actions, coupled with a flight of capital to the safety
of U.S. Treasury securities, pushed yields on long-term Treasury bonds lower.
The yield of the 30-year Treasury reached a low of 4.72% on October 5, 1998.
Amid the distress abroad, the United States benefited from the combination
of low inflation and low unemployment, which resulted from an obverse of
"Murphy's Law." For a while, it seemed as if anything that could go right for
the U.S. economy did, and anything that could go wrong didn't. Many positive
events influenced the American economy. Low prices for imported goods and the
aggressive use of technology in the workplace helped to keep down inflation. The
price of crude oil fell to $10.44 per barrel on December 10, 1998. The
unemployment rate moved lower and lower, yet excessive wage inflation never
surfaced.
Interest rates rose slightly in November and December of 1998, and the
30-year Treasury bond's yield ended December at 5.10%. Yields on municipal bonds
were unchanged during these first two months of the fiscal year. Although
municipal yields had moved lower in 1998, they had not fallen as far as Treasury
yields. The market in 1998 had to work through near-record levels of newly
issued municipal securities with little increase in demand for them. This
supply/demand imbalance kept muni yields high; indeed the yields of some
long-term insured municipal bonds were equal to 97% of the yields on equivalent
Treasury bonds when 1999 began.
Throughout the remainder of our fiscal year, interest rates moved higher.
The economies of Brazil and South Korea were recovering at a surprisingly rapid
pace and the Organization of Petroleum Exporting Countries agreed to limit oil
production, which helped oil prices to rise; the price of a barrel has since
reached the $20-$25 level. Domestically, the economy was strong and unemployment
remained low. The U.S. jobless rate fell to a 30-year low of 4.1% in October
1999. The economy continued its robust expansion (gross domestic product
increased at a 5.5% annual rate in the third quarter of 1999), even though most
economists expected growth to slow. The venerable stock market indicator, the
Dow Jones Industrial Average, crossed 10,000 on March 29, 1999, and its meteoric
rise continued until it reached a record 11,326 on August 25. All these factors
prompted the Fed to raise short-term interest rates twice, each time by 0.25
percentage point, reclaiming two-thirds of the autumn 1998 reductions in
short-term rates. The Fed's actions slowed the stock market's rise, and may be
beginning to slow the economy.
8
<PAGE> 11
The fiscal year was a difficult one for all fixed-income markets, and the
municipal bond market was no exception. Most fixed-income investments posted
negative total returns for the period. Compared with Treasury bonds, municipals
performed well during the first half of the fiscal year, both because muni
yields were high relative to Treasury yields and because the supply of new
issues declined from the high levels of 1998. By June 30, 1999, the yield of a
30-year insured municipal bond was down to 88.5% of the yield of a comparable
Treasury bond, compared with 95.0% when the fiscal year started. However,
through the final months of the fiscal year, there was increased competition
from corporate bonds for investors' bond investment dollars. The corporate bond
market suffered from the same type of supply imbalance that the municipal market
encountered in fiscal 1998, as corporations rushed to sell bonds and complete
their financing before the century's end. This imbalance caused yields on
corporate bonds to rise. The municipal market underperformed during this period
as the relatively high yields on corporate bonds attracted some large
institutional investors away.
During the fiscal year, the performance of the Vanguard Municipal Bond
Funds was consistent with their stated maturity levels. In other words, the best
returns were achieved by the funds with the shortest average maturities, and the
worst returns by those with the longest maturities.
The price sensitivity of a bond or a bond fund rises as its average
maturity and duration increases. Therefore, when interest rates go up, prices of
long-term bonds and bond funds fall further than those of intermediate-term or
short-term bonds or funds. Conversely, when interest rates are falling, price
gains are largest for long-term bonds or bond funds and smallest for short-term
bonds or funds.
Unlike interest rates, our goals and approach to investing for our
shareholders do not fluctuate. As always, we endeavor to deliver superior total
returns for investors, in part by operating our funds at the lowest reasonable
cost. Over the long term, we believe this approach will continue to serve our
shareholders well.
Ian A. MacKinnon, Managing Director
Christopher M. Ryon, Principal
Pamela Wisehaupt Tynan, Principal
Reid O. Smith, Principal
Vanguard Fixed Income Group
November 12, 1999
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INVESTMENT PHILOSOPHY
Each fund holds a diversified group of municipal bonds designed to produce a
high level of current, tax-exempt income consistent with each fund's maturity
and quality mandates. In managing the fund, Vanguard Fixed Income Group follows
a disciplined investment policy, meeting well-defined standards for credit
quality and keeping each fund within its stated maturity range, while seeking to
exceed, with reasonable consistency over the long term, average returns achieved
by comparable funds.
- --------------------------------------------------------------------------------
9
<PAGE> 12
FUND PROFILE
TAX-EXEMPT MONEY MARKET FUND
This Profile provides a snapshot of the fund's characteristics as of October 31,
1999. Key elements of this Profile are defined on page 11.
<TABLE>
<CAPTION>
FINANCIAL ATTRIBUTES
- -------------------------------------------------------
<S> <C>
Yield 3.3%
Average Maturity 60 days
Average Quality MIG-1
Expense Ratio 0.18%
</TABLE>
<TABLE>
<CAPTION>
DISTRIBUTION BY CREDIT QUALITY
(% OF PORTFOLIO)
- -------------------------------------------------------
<S> <C>
MIG-1/SP-1 65.8%
A-1/P-1 32.6
AAA/AA 1.6
A 0.0
- -------------------------------------------------------
Total 100.0%
</TABLE>
<TABLE>
<CAPTION>
LARGEST STATE CONCENTRATIONS
(% OF TOTAL NET ASSETS)
- -------------------------------------------------------
<S> <C>
Texas 11.1%
New York 8.3
Illinois 8.0
Florida 6.9
Ohio 5.7
Utah 5.0
Kentucky 4.0
Georgia 3.9
Missouri 3.6
Wisconsin 3.4
- -------------------------------------------------------
Top Ten 59.9%
</TABLE>
10
<PAGE> 13
AVERAGE COUPON. The average interest rate paid on the securities held by a fund.
It is expressed as a percentage of face value.
AVERAGE DURATION. An estimate of how much a bond fund's share price will
fluctuate in response to a change in interest rates. To see how the price could
shift, multiply the fund's duration by the change in rates. If interest rates
rise by one percentage point, the share price of a fund with an average duration
of five years would decline by about 5%. If rates decrease by a percentage
point, the fund's share price would rise by 5%.
AVERAGE MATURITY. The average length of time until bonds held by a fund reach
maturity (or are called) and are repaid. In general, the longer the average
maturity, the more a fund's share price will fluctuate in response to changes in
market interest rates.
AVERAGE QUALITY. An indicator of credit risk, this figure is the average of the
ratings assigned to a fund's securities holdings by credit-rating agencies. The
agencies make their judgment after appraising an issuer's ability to meet its
obligations. Quality is graded on a scale, with Aaa or AAA indicating the most
creditworthy bond issuers and A-1 or MIG-1 indicating the most creditworthy
issuers of money market securities.
BETA. A measure of the magnitude of a fund's past share-price fluctuations in
relation to the ups and downs of the overall market (or appropriate market
index). The market (or index) is assigned a beta of 1.00, so a fund with a beta
of 1.20 would have seen its share price rise or fall by 12% when the overall
market rose or fell by 10%.
CASH RESERVES. The percentage of a fund's net assets invested in "cash
equivalents"--highly liquid, short-term, interest-bearing securities. This
figure does not include cash invested in futures contracts to simulate bond
investment.
DISTRIBUTION BY CREDIT QUALITY. This breakdown of a fund's securities by credit
rating can help in gauging the risk that returns could be affected by defaults
or other credit problems.
DISTRIBUTION BY MATURITY. An indicator of interest-rate risk. In general, the
higher the concentration of longer-maturity issues, the more a fund's share
price will fluctuate in response to changes in interest rates.
EXPENSE RATIO. The percentage of a fund's average net assets used to pay its
annual administrative and advisory expenses. These expenses directly reduce
returns to investors.
INVESTMENT FOCUS. This grid indicates the focus of a fund in terms of two
attributes: average maturity (short, medium, or long) and average credit quality
(high, medium, or low).
LARGEST STATE CONCENTRATIONS. An indicator of diversification. The less
concentrated a fund's holdings of bonds, the less the fund will be hurt by any
financial problems in a single state or region.
NUMBER OF ISSUES. An indicator of diversification. The more separate issues a
fund holds, the less susceptible it is to a price decline stemming from the
problems of a particular issue.
R-SQUARED. A measure of how much of a fund's past returns can be explained by
the returns from the overall market (or its benchmark index). If a fund's total
return were precisely synchronized with the overall market's return, its
R-squared would be 1.00. If a fund's returns bore no relationship to the
market's returns, its R-squared would be 0.
YIELD. A snapshot of a fund's income from interest and dividends. The yield,
expressed as a percentage of the fund's net asset value, is based on income
earned over the past 30 days (7 days for money market funds) and is annualized,
or projected forward for the coming year.
YIELD TO MATURITY. The rate of return an investor would receive if the
securities held by a fund were held to their maturity dates.
11
<PAGE> 14
FUND PROFILE
SHORT-TERM TAX-EXEMPT FUND
This Profile provides a snapshot of the fund's characteristics as of October 31,
1999, compared where appropriate to an unmanaged index. Key elements of this
Profile are defined on page 11.
<TABLE>
<CAPTION>
FINANCIAL ATTRIBUTES
- -----------------------------------------------------------
SHORT-TERM LEHMAN
TAX-EXEMPT INDEX*
- -----------------------------------------------------------
<S> <C> <C>
Number of Issues 253 51,753
Yield 3.8% --
Yield to Maturity 4.0% --
Average Coupon 5.1% 5.5%
Average Maturity 442 days 12.9 years
Average Quality AA+ AA+
Average Duration 1.2 years 7.5 years
Expense Ratio 0.18% --
Cash Reserves 0% --
</TABLE>
*Lehman Municipal Bond Index.
<TABLE>
<CAPTION>
INVESTMENT FOCUS
- -----------------------------------------------------------
<S> <C>
AVERAGE MATURITY
CREDIT QUALITY
</TABLE>
<TABLE>
<CAPTION>
VOLATILITY MEASURES
- -----------------------------------------------------------
SHORT-TERM LEHMAN
TAX-EXEMPT INDEX*
- -----------------------------------------------------------
<S> <C> <C>
R-Squared 0.74 1.00
Beta 0.15 1.00
</TABLE>
*Lehman Municipal Bond Index.
<TABLE>
<CAPTION>
DISTRIBUTION BY CREDIT QUALITY
(% OF PORTFOLIO)
- ------------------------------------------------------
<S> <C>
AAA 63.1%
AA 26.5
A 5.0
BBB 5.4
BB 0.0
B 0.0
Not Rated 0.0
- ------------------------------------------------------
Total 100.0%
</TABLE>
<TABLE>
<CAPTION>
DISTRIBUTION BY MATURITY
(% OF PORTFOLIO)
- -------------------------------------------------------
<S> <C>
Under 1 Year 46.3%
1-3 Years 47.8
3-5 Years 5.9
Over 5 Years 0.0
- -------------------------------------------------------
Total 100.0%
</TABLE>
<TABLE>
<CAPTION>
LARGEST STATE CONCENTRATIONS
(% OF TOTAL NET ASSETS)
- -------------------------------------------------------
<S> <C>
New York 14.2%
Texas 12.5
Pennsylvania 8.6
Massachusetts 6.8
Florida 4.5
Michigan 3.6
Wisconsin 3.5
Wyoming 3.4
Georgia 2.9
California 2.9
- -------------------------------------------------------
Top Ten 62.9%
</TABLE>
12
<PAGE> 15
FUND PROFILE
LIMITED-TERM TAX-EXEMPT FUND
This Profile provides a snapshot of the fund's characteristics as of October 31,
1999, compared where appropriate to an unmanaged index. Key elements of this
Profile are defined on page 11.
FINANCIAL ATTRIBUTES
<TABLE>
<CAPTION>
- -----------------------------------------------------------
LIMITED-TERM LEHMAN
TAX-EXEMPT INDEX*
- -----------------------------------------------------------
<S> <C> <C>
Number of Issues 352 51,753
Yield 4.3% --
Yield to Maturity 4.5% --
Average Coupon 5.6% 5.5%
Average Maturity 3.1 years 12.9 years
Average Quality AA AA+
Average Duration 2.7 years 7.5 years
Expense Ratio 0.18% --
Cash Reserves 0.8% --
</TABLE>
*Lehman Municipal Bond Index.
<TABLE>
<CAPTION>
INVESTMENT FOCUS
- -----------------------------------------------------------
<S> <C>
AVERAGE MATURITY
CREDIT QUALITY
</TABLE>
<TABLE>
<CAPTION>
VOLATILITY MEASURES
- -----------------------------------------------------------
LIMITED-TERM LEHMAN
TAX-EXEMPT INDEX*
- -----------------------------------------------------------
<S> <C> <C>
R-Squared 0.86 1.00
Beta 0.42 1.00
</TABLE>
*Lehman Municipal Bond Index.
<TABLE>
<CAPTION>
DISTRIBUTION BY CREDIT QUALITY
(% OF PORTFOLIO)
- -------------------------------------------------------
<S> <C>
AAA 58.4%
AA 28.4
A 4.6
BBB 6.8
BB 1.8
B 0.0
Not Rated 0.0
- -------------------------------------------------------
Total 100.0%
</TABLE>
<TABLE>
<CAPTION>
DISTRIBUTION BY MATURITY
(% OF PORTFOLIO)
- -------------------------------------------------------
<S> <C>
Under 1 Year 15.8%
1-3 Years 35.8
3-5 Years 33.7
Over 5 Years 14.7
- -------------------------------------------------------
Total 100.0%
</TABLE>
<TABLE>
<CAPTION>
LARGEST STATE CONCENTRATIONS
(% OF TOTAL NET ASSETS)
- -------------------------------------------------------
<S> <C>
New York 15.5%
Texas 11.7
Michigan 7.1
Pennsylvania 5.5
California 5.0
Illinois 5.0
Massachusetts 4.6
Washington 3.6
Louisiana 3.3
Connecticut 3.2
- -------------------------------------------------------
Top Ten 64.5%
</TABLE>
13
<PAGE> 16
FUND PROFILE
INTERMEDIATE-TERM TAX-EXEMPT FUND
This Profile provides a snapshot of the fund's characteristics as of October 31,
1999, compared where appropriate to an unmanaged index. Key elements of this
Profile are defined on page 11.
<TABLE>
<CAPTION>
FINANCIAL ATTRIBUTES
- --------------------------------------------------------------
INTERMEDIATE-TERM LEHMAN
TAX-EXEMPT INDEX*
- --------------------------------------------------------------
<S> <C> <C>
Number of Issues 976 51,753
Yield 4.8% --
Yield to Maturity 4.9% --
Average Coupon 5.4% 5.5%
Average Maturity 7.4 years 12.9 years
Average Quality AA+ AA+
Average Duration 5.6 years 7.5 years
Expense Ratio 0.18% --
Cash Reserves 1.2% --
</TABLE>
*Lehman Municipal Bond Index.
<TABLE>
<CAPTION>
INVESTMENT FOCUS
- -----------------------------------------------------------
<S> <C>
AVERAGE MATURITY
CREDIT QUALITY
</TABLE>
<TABLE>
<CAPTION>
VOLATILITY MEASURES
- -----------------------------------------------------------
INTERMEDIATE-TERM LEHMAN
TAX-EXEMPT INDEX*
- -----------------------------------------------------------
<S> <C> <C>
R-Squared 0.94 1.00
Beta 0.80 1.00
</TABLE>
*Lehman Municipal Bond Index.
<TABLE>
<CAPTION>
DISTRIBUTION BY CREDIT QUALITY
(% OF PORTFOLIO)
- -----------------------------------------------------
<S> <C>
AAA 65.5%
AA 24.1
A 5.2
BBB 4.9
BB 0.3
B 0.0
Not Rated 0.0
- ------------------------------------------------------
Total 100.0%
</TABLE>
<TABLE>
<CAPTION>
DISTRIBUTION BY MATURITY
(% OF PORTFOLIO)
- -----------------------------------------------------
<S> <C>
Under 1 Year 9.7%
1-5 Years 20.5
5-10 Years 36.6
10-20 Years 32.6
20-30 Years 0.6
Over 30 Years 0.0
- ------------------------------------------------------
Total 100.0%
</TABLE>
<TABLE>
<CAPTION>
LARGEST STATE CONCENTRATIONS
(% OF TOTAL NET ASSETS)
- -----------------------------------------------------
<S> <C>
New York 14.8%
Texas 11.1
Pennsylvania 8.9
California 8.4
Massachusetts 7.1
New Jersey 5.0
Florida 3.8
Nevada 3.4
Illinois 3.2
Michigan 3.2
- -----------------------------------------------------
Top Ten 68.9%
</TABLE>
14
<PAGE> 17
FUND PROFILE
INSURED LONG-TERM TAX-EXEMPT FUND
This Profile provides a snapshot of the fund's characteristics as of October 31,
1999, compared where appropriate to an unmanaged index. Key elements of this
Profile are defined on page 11.
<TABLE>
<CAPTION>
FINANCIAL ATTRIBUTES
- ----------------------------------------------------------
INSURED LONG-TERM LEHMAN
TAX-EXEMPT INDEX*
- ----------------------------------------------------------
<S> <C> <C>
Number of Issues 258 51,753
Yield 5.2% --
Yield to Maturity 5.5% --
Average Coupon 5.5% 5.5%
Average Maturity 14.3 years 12.9 years
Average Quality AAA AA+
Average Duration 8.8 years 7.5 years
Expense Ratio 0.19% --
Cash Reserves 0% --
</TABLE>
*Lehman Municipal Bond Index.
<TABLE>
<CAPTION>
INVESTMENT FOCUS
- -------------------------------------------------
<S> <C>
AVERAGE MATURITY
CREDIT QUALITY
</TABLE>
<TABLE>
<CAPTION>
DISTRIBUTION BY CREDIT QUALITY
(% OF PORTFOLIO)
- -----------------------------------------------------
<S> <C>
AAA 98.8%
AA 1.2
A 0.0
BBB 0.0
BB 0.0
B 0.0
Not Rated 0.0
- ------------------------------------------------------
Total 100.0%
</TABLE>
<TABLE>
<CAPTION>
VOLATILITY MEASURES
INSURED LONG-TERM LEHMAN
TAX-EXEMPT INDEX*
- -----------------------------------------------------------
<S> <C> <C>
R-Squared 0.98 1.00
Beta 1.14 1.00
</TABLE>
*Lehman Municipal Bond Index.
<TABLE>
<CAPTION>
DISTRIBUTION BY MATURITY
(% OF PORTFOLIO)
- -----------------------------------------------------
<S> <C>
Under 1 Year 6.4%
1-5 Years 7.6
5-10 Years 17.3
10-20 Years 43.0
20-30 Years 23.2
Over 30 Years 2.5
- -----------------------------------------------------
Total 100.0%
</TABLE>
<TABLE>
<CAPTION>
LARGEST STATE CONCENTRATIONS
(% OF TOTAL NET ASSETS)
- -----------------------------------------------------
<S> <C>
California 10.2%
Florida 8.7
Texas 8.4
Pennsylvania 8.0
New Jersey 5.7
Georgia 5.1
Ohio 5.0
Illinois 4.2
New York 3.9
Colorado 3.7
- -----------------------------------------------------
Top Ten 62.9%
</TABLE>
15
<PAGE> 18
FUND PROFILE
LONG-TERM TAX-EXEMPT FUND
This Profile provides a snapshot of the fund's characteristics as of October 31,
1999, compared where appropriate to an unmanaged index. Key elements of this
Profile are defined on page 11.
<TABLE>
<CAPTION>
FINANCIAL ATTRIBUTES
- -----------------------------------------------------------
LONG-TERM LEHMAN
TAX-EXEMPT INDEX*
- -----------------------------------------------------------
<S> <C> <C>
Number of Issues 204 51,753
Yield 5.3% --
Yield to Maturity 5.6% --
Average Coupon 5.5% 5.5%
Average Maturity 14.7 years 12.9 years
Average Quality AA+ AA+
Average Duration 9.0 years 7.5 years
Expense Ratio 0.18% --
Cash Reserves 0% --
</TABLE>
*Lehman Municipal Bond Index.
<TABLE>
<CAPTION>
INVESTMENT FOCUS
- -----------------------------------------------------------
<S> <C>
AVERAGE MATURITY
CREDIT QUALITY
</TABLE>
<TABLE>
<CAPTION>
DISTRIBUTION BY CREDIT QUALITY
(% OF PORTFOLIO)
- -----------------------------------------------------
<S> <C>
AAA 61.8%
AA 22.2
A 12.4
BBB 3.6
BB 0.0
B 0.0
Not Rated 0.0
- -----------------------------------------------------
Total 100.0%
</TABLE>
<TABLE>
<CAPTION>
VOLATILITY MEASURES
LONG-TERM LEHMAN
TAX-EXEMPT INDEX*
- ----------------------------------------------------
<S> <C> <C>
R-Squared 0.98 1.00
Beta 1.12 1.00
</TABLE>
*Lehman Municipal Bond Index.
<TABLE>
<CAPTION>
DISTRIBUTION BY MATURITY
(% OF PORTFOLIO)
- -----------------------------------------------------
<S> <C>
Under 1 Year 7.5%
1-5 Years 10.3
5-10 Years 4.0
10-20 Years 52.5
20-30 Years 23.6
Over 30 Years 2.1
- -----------------------------------------------------
Total 100.0%
</TABLE>
<TABLE>
<CAPTION>
LARGEST STATE CONCENTRATIONS
(% OF TOTAL NET ASSETS)
- -----------------------------------------------------
<S> <C>
California 15.4%
Texas 14.3
New York 10.0
Pennsylvania 9.5
Massachusetts 8.4
Illinois 4.4
Florida 3.2
Washington 2.9
Tennessee 2.7
New Jersey 2.5
- -----------------------------------------------------
Top Ten 73.3%
</TABLE>
16
<PAGE> 19
FUND PROFILE
HIGH-YIELD TAX-EXEMPT FUND
This Profile provides a snapshot of the fund's characteristics as of October 31,
1999, compared where appropriate to an unmanaged index. Key elements of this
Profile are defined on page 11.
<TABLE>
<CAPTION>
FINANCIAL ATTRIBUTES
- ----------------------------------------------------------
HIGH-YIELD LEHMAN
TAX-EXEMPT INDEX*
- ----------------------------------------------------------
<S> <C> <C>
Number of Issues 317 51,753
Yield 5.5% --
Yield to Maturity 5.8% --
Average Coupon 5.4% 5.5%
Average Maturity 14.3 years 12.9 years
Average Quality A+ AA+
Average Duration 8.7 years 7.5 years
Expense Ratio 0.18% --
Cash Reserves 0% --
</TABLE>
*Lehman Municipal Bond Index.
<TABLE>
<CAPTION>
INVESTMENT FOCUS
- ----------------------------------------------------------
<S> <C>
AVERAGE MATURITY
CREDIT QUALITY
</TABLE>
<TABLE>
<CAPTION>
DISTRIBUTION BY CREDIT QUALITY
(% OF PORTFOLIO)
- -----------------------------------------------------
<S> <C>
AAA 42.0%
AA 9.9
A 10.5
BBB 22.8
BB 3.2
B 0.0
Not Rated 11.6
- ----------------------------------------------------
Total 100.0%
</TABLE>
VOLATILITY MEASURES
<TABLE>
<CAPTION>
- --------------------------------------------------------
HIGH-YIELD LEHMAN
TAX-EXEMPT INDEX*
- --------------------------------------------------------
<S> <C> <C>
R-Squared 0.97 1.00
Beta 1.03 1.00
</TABLE>
*Lehman Municipal Bond Index.
<TABLE>
<CAPTION>
DISTRIBUTION BY MATURITY
(% OF PORTFOLIO)
- -----------------------------------------------------
<S> <C> <C>
Under 1 Year 4.7%
1-5 Years 9.9
5-10 Years 20.6
10-20 Years 39.8
20-30 Years 23.9
Over 30 Years 1.1
- -----------------------------------------------------
Total 100.0%
</TABLE>
<TABLE>
<CAPTION>
LARGEST STATE CONCENTRATIONS
(% OF TOTAL NET ASSETS)
- -----------------------------------------------------
<S> <C>
Pennsylvania 10.6%
California 10.1
New York 9.1
Texas 8.8
Massachusetts 6.6
Michigan 4.5
Ohio 4.0
Colorado 3.9
New Jersey 3.4
Illinois 3.3
- -----------------------------------------------------
Top Ten 64.3%
</TABLE>
17
<PAGE> 20
PERFORMANCE SUMMARY
TAX-EXEMPT MONEY MARKET FUND
All of the data on this page represent past performance, which cannot be used to
predict future returns that may be achieved by the fund. Note that annual
returns can fluctuate widely. An investment in a money market fund is not
insured or guaranteed by the Federal Deposit Insurance Corporation or any other
government agency. Although the fund seeks to preserve the value of your
investment at $1 per share, it is possible to lose money by investing in the
fund.
<TABLE>
<CAPTION>
TOTAL INVESTMENT RETURNS: JUNE 10, 1980-OCTOBER 31, 1999
- --------------------------------------------------------
TAX-EXEMPT MONEY MARKET FUND AVERAGE
FUND*
FISCAL CAPITAL INCOME TOTAL TOTAL
YEAR RETURN RETURN RETURN RETURN
- --------------------------------------------------------
<S> <C> <C> <C> <C>
1980 0.0% 1.3% 1.3% 0.1%
1981 0.0 6.4 6.4 6.2
1982 0.0 7.4 7.4 7.8
1983 0.0 5.1 5.1 4.8
1984 0.0 5.8 5.8 5.4
1985 0.0 5.4 5.4 5.0
1986 0.0 4.9 4.9 4.6
1987 0.0 4.4 4.4 3.9
1988 0.0 5.0 5.0 4.7
1989 0.0 6.3 6.3 5.9
1990 0.0 5.9 5.9 5.5
1991 0.0 4.8 4.8 4.5
1992 0.0 3.3 3.3 2.8
1993 0.0 2.5 2.5 2.0
1994 0.0 2.5 2.5 2.1
1995 0.0 3.7 3.7 3.3
1996 0.0 3.4 3.4 3.0
1997 0.0 3.5 3.5 3.0
1998 0.0 3.4 3.4 3.0
1999 0.0 3.1 3.1 2.6
- --------------------------------------------------------
</TABLE>
Average Tax-Exempt Money Market Fund; derived from data provided by Lipper Inc.
See Financial Highlights table on page 31 for dividend information for the past
five years.
- --------------------------------------------------------
SEC 7-Day Annualized Yield (10/31/1999): 3.27% *
<TABLE>
<CAPTION>
CUMULATIVE PERFORMANCE: OCTOBER 31, 1989-OCTOBER 31, 1999
- ---------------------------------------------------------
Tax-Exempt Money Average Tax-Exempt
Market Fund Money Market Fund
<S> <C> <C>
1989 10 10000 10000
1990 01 10148 10139
1990 04 10291 10275
1990 07 10437 10412
1990 10 10587 10553
1991 01 10735 10696
1991 04 10861 10808
1991 07 10979 10912
1991 10 11099 11024
1992 01 11210 11125
1992 04 11300 11201
1992 07 11384 11272
1992 10 11462 11336
1993 01 11537 11402
1993 04 11604 11453
1993 07 11673 11504
1993 10 11745 11560
1994 01 11813 11620
1994 04 11879 11670
1994 07 11953 11731
1994 10 12043 11805
1995 01 12150 11903
1995 04 12263 11998
1995 07 12379 12097
1995 10 12492 12194
1996 01 12606 12296
1996 04 12707 12381
1996 07 12813 12467
1996 10 12921 12558
1997 01 13031 12656
1997 04 13138 12744
1997 07 13257 12842
1997 10 13373 12940
1998 01 13493 13047
1998 04 13603 13139
1998 07 13721 13235
1998 10 13833 13328
1999 01 13939 13422
1999 04 14036 13500
1999 07 14145 13585
1999 10 14259 13675
</TABLE>
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED OCTOBER 31, 1999
--------------------------------- FINAL VALUE OF A
1 YEAR 5 YEARS 10 YEARS $10,000 INVESTMENT
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Tax-Exempt Money Market Fund 3.08% 3.43% 3.61% $14,259
Average Tax-Exempt Money Market Fund* 2.60 2.98 3.18 13,675
- ---------------------------------------------------------------------------------------------------------------------
</TABLE>
*Derived from data provided by Lipper Inc.
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS: PERIODS ENDED SEPTEMBER 30, 1999*
- -------------------------------------------------------------------------------------------------------------------------
10 YEARS
INCEPTION -------------------------------
DATE 1 YEAR 5 YEARS CAPITAL INCOME TOTAL
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Tax-Exempt Money Market Fund 6/10/1980 3.07% 3.43% 0.00% 3.64% 3.64%
- -------------------------------------------------------------------------------------------------------------------------
</TABLE>
*SEC rules require that we provide this average annual total return information
through the latest calendar quarter.
18
<PAGE> 21
PERFORMANCE SUMMARY
SHORT-TERM TAX-EXEMPT FUND
All of the data on this page represent past performance, which cannot be used
to predict future returns that may be achieved by the fund. Note, too, that
both share price and return can fluctuate widely, so an investment in the fund
could lose money.
<TABLE>
<CAPTION>
TOTAL INVESTMENT RETURNS: OCTOBER 31, 1979-OCTOBER 31, 1999
- --------------------------------------------------------------
SHORT-TERM TAX-EXEMPT FUND LEHMAN*
FISCAL CAPITAL INCOME TOTAL TOTAL
YEAR RETURN RETURN RETURN RETURN
- --------------------------------------------------------------
<S> <C> <C> <C> <C>
1980 0.9% 5.3% 6.2% N/A
1981 0.1 6.7 6.8 N/A
1982 2.4 8.3 10.7 N/A
1983 -0.5 6.1 5.6 N/A
1984 -0.1 6.5 6.4 N/A
1985 0.7 6.5 7.2 N/A
1986 1.6 6.1 7.7 11.0%
1987 -2.2 5.0 2.8 3.2
1988 1.6 5.4 7.0 5.9
1989 0.3 6.0 6.3 6.2
1990 0.4 6.1 6.5 7.0
1991 1.2 5.7 6.9 9.4
1992 0.8 4.5 5.3 7.8
1993 0.3 3.9 4.2 6.6
1994 -1.3 3.5 2.2 1.4
1995 1.2 4.1 5.3 8.0
1996 -0.1 4.0 3.9 4.5
1997 0.0 4.0 4.0 5.5
1998 0.5 4.0 4.5 5.7
1999 -1.0 3.7 2.7 2.2
- --------------------------------------------------------------
</TABLE>
*Lehman 3 Year Municipal Bond Index.
See Financial Highlights table on page 32 for dividend and capital gains
information for the past five years.
CUMULATIVE PERFORMANCE: OCTOBER 31, 1989-OCTOBER 31, 1999
- --------------------------------------------------------------
<TABLE>
<CAPTION>
CUMULATIVE PERFORMANCE: OCTOBER 31, 1989-OCTOBER 31, 1999
- ------------------------------------------------------------------------------
Short-Term Average Adjusted Short Lehman 3 Year Municipal
Tax-Exempt Fund Municipal Debt Fund* Bond Index
<S> <C> <C> <C> <C>
1989 10 10000 10000 10000
1990 01 10168 10139 10177
1990 04 10278 10275 10251
1990 07 10499 10412 10559
1990 10 10651 10553 10698
1991 01 10883 10824 11021
1991 04 11057 11036 11234
1991 07 11195 11083 11406
1991 10 11382 11286 11699
1992 01 11612 11578 12055
1992 04 11690 11690 12122
1992 07 11938 11889 12614
1992 10 11990 11941 12609
1993 01 12168 12177 12870
1993 04 12296 12351 13109
1993 07 12355 12325 13235
1993 10 12489 12453 13445
1994 01 12626 12714 13678
1994 04 12595 12648 13466
1994 07 12704 12660 13646
1994 10 12764 12682 13627
1995 01 12872 12883 13775
1995 04 13080 13107 14094
1995 07 13296 13239 14496
1995 10 13437 13371 14718
1996 01 13624 13682 14990
1996 04 13666 13702 14976
1996 07 13808 13723 15163
1996 10 13960 13870 15381
1997 01 14091 14157 15600
1997 04 14179 14232 15665
1997 07 14390 14328 16074
1997 10 14524 14447 16226
1998 01 14694 14771 16492
1998 04 14787 14854 16533
1998 07 14963 14889 16802
1998 10 15175 15098 17152
1999 01 15326 15405 17394
1999 04 15404 15482 17483
1999 07 15478 15392 17439
1999 10 15583 15464 17524
</TABLE>
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED OCTOBER 31, 1999
------------------------------ FINAL VALUE OF A
1 YEAR 5 YEARS 10 YEARS $10,000 INVESTMENT
- -----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Short-Term Tax-Exempt Fund 2.69% 4.07% 4.54% $15,583
Average Adjusted Short Municipal Debt Fund* 2.73 4.11 4.49 15,511
Lehman 3 Year Municipal Bond Index 2.17 5.16 5.77 17,524
- -----------------------------------------------------------------------------------------------
</TABLE>
*Derived from data provided by Lipper Inc.; adjusted to exclude funds with a
dollar-weighted average maturity greater than 2 years as of September 30, 1999.
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS: PERIODS ENDED SEPTEMBER 30, 1999*
- -----------------------------------------------------------------------------------------------
10 YEARS
INCEPTION -----------------------
DATE 1 YEAR 5 YEARS CAPITAL INCOME TOTAL
- -----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Short-Term Tax-Exempt Fund 9/1/1977 2.96% 4.06% 0.23% 4.36% 4.59%
- -----------------------------------------------------------------------------------------------
</TABLE>
*SEC rules require that we provide this average annual total return information
through the latest calendar quarter.
19
<PAGE> 22
PERFORMANCE SUMMARY
LIMITED-TERM TAX-EXEMPT FUND
All of the data on this page represent past performance, which cannot be used
to predict future returns that may be achieved by the fund. Note, too, that
both share price and return can fluctuate widely, so an investment in the fund
could lose money.
<TABLE>
<CAPTION>
TOTAL INVESTMENT RETURNS: AUGUST 31, 1987-OCTOBER 31, 1999
- ------------------------------------------------------------
LIMITED-TERM TAX-EXEMPT FUND LEHMAN*
FISCAL CAPITAL INCOME TOTAL TOTAL
YEAR RETURN RETURN RETURN RETURN
- ------------------------------------------------------------
<S> <C> <C> <C> <C>
1987 -0.6% 1.0% 0.4% -0.2%
1988 2.2 6.3 8.5 5.9
1989 0.0 6.5 6.5 6.2
1990 0.7 6.5 7.2 7.0
1991 2.8 6.1 8.9 9.4
1992 1.7 5.3 7.0 7.8
1993 2.4 4.6 7.0 6.6
1994 -3.1 4.2 1.1 1.4
1995 2.5 4.7 7.2 8.0
1996 -0.2 4.6 4.4 4.5
1997 0.5 4.5 5.0 5.5
1998 1.0 4.4 5.4 5.7
1999 -2.4 4.2 1.8 2.2
- ------------------------------------------------------------
</TABLE>
*Lehman 3 Year Municipal Bond Index.
See Financial Highlights table on page 32 for dividend information for the past
five years.
CUMULATIVE PERFORMANCE: OCTOBER 31, 1989-OCTOBER 31, 1999
- ------------------------------------------------------------
<TABLE>
<CAPTION>
CUMULATIVE PERFORMANCE: OCTOBER 31, 1989-OCTOBER 31, 1999
- --------------------------------------------------------------------------------
Limited-Term Average Short Municipal Lehman 3 Year
Tax-Exempt Debt Blend Fund Municipal Bond Index
<S> <C> <C> <C> <C>
1989 10 10000 10000 10000
1990 01 10190 10162 10177
1990 04 10270 10252 10251
1990 07 10577 10503 10559
1990 10 10724 10628 10698
1991 01 11023 10880 11021
1991 04 11240 11075 11234
1991 07 11400 11223 11406
1991 10 11682 11451 11699
1992 01 11989 11722 12055
1992 04 12047 11828 12122
1992 07 12475 12197 12614
1992 10 12495 12198 12609
1993 01 12796 12504 12870
1993 04 13010 12759 13109
1993 07 13116 12844 13235
1993 10 13368 13103 13445
1994 01 13585 13259 13678
1994 04 13390 13069 13466
1994 07 13546 13166 13646
1994 10 13513 13168 13627
1995 01 13640 13252 13775
1995 04 13977 13563 14094
1995 07 14299 13808 14496
1995 10 14490 14004 14718
1996 01 14779 14216 14990
1996 04 14722 14238 14976
1996 07 14904 14349 15163
1996 10 15126 14542 15381
1997 01 15311 14683 15600
1997 04 15337 14809 15665
1997 07 15744 15113 16074
1997 10 15887 15248 16226
1998 01 16149 15447 16492
1998 04 16166 15554 16533
1998 07 16434 15714 16802
1998 10 16748 16000 17152
1999 01 17006 16159 17394
1999 04 17056 16301 17483
1999 07 17016 16176 17439
1999 10 17056 16189 17524
</TABLE>
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED OCTOBER 31, 1999
------------------------------ FINAL VALUE OF A
1 YEAR 5 YEARS 10 YEARS $10,000 INVESTMENT
- -----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Limited-Term Tax-Exempt Fund 1.83% 4.77% 5.48% $17,056
Average Short Municipal Debt Blend Fund* 1.18 4.22 4.94 16,189
Lehman 3 Year Municipal Bond Index 2.17 5.16 5.77 17,524
- -----------------------------------------------------------------------------------------------
</TABLE>
*Derived from data provided by Lipper Inc.
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS: PERIODS ENDED SEPTEMBER 30, 1999*
- --------------------------------------------------------------------------------------------
10 YEARS
INCEPTION -----------------------
DATE 1 YEAR 5 YEARS CAPITAL INCOME TOTAL
- --------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Limited-Term Tax-Exempt Fund 8/31/1987 2.21% 4.73% 0.62% 4.94% 5.56%
- --------------------------------------------------------------------------------------------
</TABLE>
*SEC rules require that we provide this average annual total return information
through the latest calendar quarter.
20
<PAGE> 23
PERFORMANCE SUMMARY
INTERMEDIATE-TERM TAX-EXEMPT FUND
All of the data on this page represent past performance, which cannot be used
to predict future returns that may be achieved by the fund. Note, too, that
both share price and return can fluctuate widely, so an investment in the fund
could lose money.
<TABLE>
<CAPTION>
TOTAL INVESTMENT RETURNS: OCTOBER 31, 1979-OCTOBER 31, 1999
- ------------------------------------------------------------
INTERMEDIATE-TERM TAX-EXEMPT FUND LEHMAN*
FISCAL CAPITAL INCOME TOTAL TOTAL
YEAR RETURN RETURN RETURN RETURN
- ------------------------------------------------------------
<S> <C> <C> <C> <C>
1980 -11.6% 5.9% -5.7% N/A
1981 -18.4 7.4 -11.0 N/A
1982 15.4 11.3 26.7 N/A
1983 0.3 8.4 8.7 N/A
1984 -1.7 8.9 7.2 N/A
1985 7.2 9.4 16.6 N/A
1986 10.8 8.5 19.3 19.8%
1987 -7.9 6.6 -1.3 -0.4
1988 6.4 7.5 13.9 10.5
1989 0.3 7.2 7.5 6.3
1990 0.3 7.0 7.3 8.0
1991 5.6 7.0 12.6 11.2
1992 1.2 6.0 7.2 8.2
1993 8.4 5.9 14.3 12.0
1994 -6.5 5.0 -1.5 -1.9
1995 6.3 5.8 12.1 12.3
1996 -0.3 5.2 4.9 4.7
1997 1.3 5.3 6.6 7.4
1998 1.7 5.1 6.8 7.4
1999 -5.2 4.8 -0.4 0.0
- ------------------------------------------------------------
</TABLE>
*Lehman 7 Year Municipal Bond Index.
See Financial Highlights table on page 33 for dividend and capital gains
information for the past five years.
CUMULATIVE PERFORMANCE: OCTOBER 31, 1989-OCTOBER 31, 1999
- ------------------------------------------------------------
<TABLE>
<CAPTION>
CUMULATIVE PERFORMANCE: OCTOBER 31, 1989-OCTOBER 31, 1999
- ---------------------------------------------------------------------------
Inter-Term Average Intermediate Lehman 7 Year
Tax-Exempt Fund Municipal Debt Fund* Municipal Bond Index
<S> <C> <C> <C> <C>
1989 10 10000 10000 10000
1990 01 10212 10181 10255
1990 04 10223 10202 10258
1990 07 10722 10586 10679
1990 10 10735 10651 10800
1991 01 11172 10997 11189
1991 04 11456 11215 11425
1991 07 11668 11386 11591
1991 10 12083 11731 12007
1992 01 12343 12036 12332
1992 04 12463 12102 12401
1992 07 13259 12753 13108
1992 10 12958 12590 12991
1993 01 13589 13076 13487
1993 04 14046 13429 13803
1993 07 14298 13668 14099
1993 10 14809 14119 14546
1994 01 15125 14414 14837
1994 04 14591 13780 14232
1994 07 14863 13993 14479
1994 10 14591 13768 14270
1995 01 14987 14032 14543
1995 04 15482 14500 15064
1995 07 15966 14894 15647
1995 10 16358 15270 16030
1996 01 16840 15660 16454
1996 04 16568 15421 16205
1996 07 16835 15622 16440
1996 10 17154 15933 16775
1997 01 17405 16140 17067
1997 04 17449 16188 17072
1997 07 18173 16863 17855
1997 10 18279 16987 18021
1998 01 18746 17404 18503
1998 04 18663 17342 18411
1998 07 19053 17638 18794
1998 10 19518 18097 19353
1999 01 19912 18394 19735
1999 04 19865 18353 19661
1999 07 19588 18035 19409
1999 10 19439 17831 19355
</TABLE>
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED OCTOBER 31, 1999
------------------------------- FINAL VALUE OF A
1 YEAR 5 YEARS 10 YEARS $10,000 INVESTMENT
- -------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Intermediate-Term Tax-Exempt Fund -0.40% 5.91% 6.87% $19,439
Average Intermediate Municipal Debt Fund* -1.47 5.31 5.95 17,831
Lehman 7 Year Municipal Bond Index 0.01 6.29 6.83 19,355
- -------------------------------------------------------------------------------------------------
</TABLE>
*Derived from data provided by Lipper Inc.
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS: PERIODS ENDED SEPTEMBER 30, 1999*
- ------------------------------------------------------------------------------------------
10 YEARS
INCEPTION ------------------------
DATE 1 YEAR 5 YEARS CAPITAL INCOME TOTAL
- ------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Intermediate-Term Tax-Exempt Fund 9/1/1977 0.38% 5.80% 1.31% 5.71% 7.02%
- ------------------------------------------------------------------------------------------
</TABLE>
*SEC rules require that we provide this average annual total return information
through the latest calendar quarter.
21
<PAGE> 24
PERFORMANCE SUMMARY
INSURED LONG-TERM TAX-EXEMPT FUND
All of the data on this page represent past performance, which cannot be used
to predict future returns that may be achieved by the fund. Note, too, that
both share price and return can fluctuate widely, so an investment in the fund
could lose money.
<TABLE>
<CAPTION>
TOTAL INVESTMENT RETURNS: SEPTEMBER 30, 1984-OCTOBER 31, 1999
- ------------------------------------------------------------
INSURED LONG-TERM TAX-EXEMPT FUND LEHMAN*
FISCAL CAPITAL INCOME TOTAL TOTAL
YEAR RETURN RETURN RETURN RETURN
- ------------------------------------------------------------
<S> <C> <C> <C> <C>
1984 -1.6% 0.8% -0.8% 1.3%
1985 6.7 9.7 16.4 18.7
1986 14.3 9.2 23.5 22.6
1987 -9.2 6.9 -2.3 -0.8
1988 7.9 8.2 16.1 14.6
1989 1.3 7.5 8.8 8.1
1990 -0.8 7.2 6.4 7.4
1991 6.0 7.2 13.2 12.2
1992 0.2 6.5 6.7 8.4
1993 10.7 6.4 17.1 14.1
1994 -10.8 5.2 -5.6 -4.3
1995 9.5 6.4 15.9 14.8
1996 0.7 5.6 6.3 5.7
1997 1.9 5.7 7.6 8.5
1998 2.4 5.5 7.9 8.0
1999 -7.7 5.0 -2.7 -1.8
- ------------------------------------------------------------
</TABLE>
*Lehman Municipal Bond Index.
See Financial Highlights table on page 33 for dividend and capital gains
information for the past five years.
CUMULATIVE PERFORMANCE: OCTOBER 31, 1989-OCTOBER 31, 1999
- ------------------------------------------------------------
<TABLE>
<CAPTION>
CUMULATIVE PERFORMANCE: OCTOBER 31, 1989-OCTOBER 31, 1999
- -----------------------------------------------------------------------
Insured Long- Average Insured Lehman Municipal
Term Tax-Exempt Municipal Debt Fund* Bond Index
Fund
<S> <C> <C> <C> <C>
1989 10 10000 10000 10000
1990 01 10107 10126 10210
1990 04 10062 10116 10230
1990 07 10694 10609 10700
1990 10 10640 10582 10742
1991 01 11167 11028 11154
1991 04 11380 11253 11405
1991 07 11562 11466 11635
1991 10 12048 11843 12049
1992 01 12317 12142 12370
1992 04 12432 12241 12489
1992 07 13432 13062 13233
1992 10 12860 12688 13060
1993 01 13640 13315 13585
1993 04 14237 13812 14069
1993 07 14451 14088 14403
1993 10 15059 14581 14898
1994 01 15427 14913 15251
1994 04 14425 13919 14372
1994 07 14831 14207 14677
1994 10 14219 13662 14254
1995 01 14924 14195 14713
1995 04 15525 14797 15334
1995 07 15952 15130 15834
1995 10 16482 15662 16370
1996 01 17195 16269 16927
1996 04 16668 15741 16553
1996 07 17055 16045 16879
1996 10 17516 16442 17303
1997 01 17733 16604 17577
1997 04 17799 16646 17650
1997 07 18801 17576 18609
1997 10 18843 17656 18772
1998 01 19478 18208 19354
1998 04 19309 18054 19291
1998 07 19786 18432 19724
1998 10 20328 18925 20278
1999 01 20751 19219 20641
1999 04 20732 19147 20632
1999 07 20274 18651 20292
1999 10 19772 18089 19919
</TABLE>
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED OCTOBER 31, 1999
------------------------------ FINAL VALUE OF A
1 YEAR 5 YEARS 10 YEARS $10,000 INVESTMENT
- -------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Insured Long-Term Tax-Exempt Fund -2.74% 6.82% 7.05% $19,772
Average Insured Municipal Debt Fund* -4.42 5.77 6.11 18,089
Lehman Municipal Bond Index -1.77 6.92 7.13 19,919
- -------------------------------------------------------------------------------------------
</TABLE>
*Derived from data provided by Lipper Inc.
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS: PERIODS ENDED SEPTEMBER 30, 1999*
- -------------------------------------------------------------------------------------------
10 YEARS
INCEPTION -------------------------
DATE 1 YEAR 5 YEARS CAPITAL INCOME TOTAL
- -------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Insured Long-Term Tax-Exempt Fund 9/30/1984 -1.87% 6.62% 1.22% 6.09% 7.31%
- -------------------------------------------------------------------------------------------
</TABLE>
*SEC rules require that we provide this average annual total return information
through the latest calendar quarter.
22
<PAGE> 25
PERFORMANCE SUMMARY
LONG-TERM TAX-EXEMPT FUND
All of the data on this page represent past performance, which cannot be used
to predict future returns that may be achieved by the fund. Note, too, that
both share price and return can fluctuate widely, so an investment in the fund
could lose money.
<TABLE>
<CAPTION>
TOTAL INVESTMENT RETURNS: OCTOBER 31, 1979-OCTOBER 31, 1999
- ------------------------------------------------------------
LONG-TERM TAX-EXEMPT FUND LEHMAN*
FISCAL CAPITAL INCOME TOTAL TOTAL
YEAR RETURN RETURN RETURN RETURN
- ------------------------------------------------------------
<S> <C> <C> <C> <C>
1980 -19.2% 6.5% -12.7% N/A
1981 -21.4 8.4 -13.0 -11.4%
1982 19.0 13.3 32.3 31.6
1983 1.8 9.5 11.3 4.4
1984 -3.3 9.6 6.3 7.6
1985 8.3 10.1 18.4 18.7
1986 14.5 9.3 23.8 22.6
1987 -11.0 6.9 -4.1 -0.8
1988 9.0 8.3 17.3 14.6
1989 1.2 7.6 8.8 8.1
1990 -1.1 7.2 6.1 7.4
1991 6.7 7.6 14.3 12.2
1992 0.8 6.7 7.5 8.4
1993 10.5 6.4 16.9 14.1
1994 -10.7 5.2 -5.5 -4.3
1995 9.5 6.5 16.0 14.8
1996 1.1 5.6 6.7 5.7
1997 2.6 5.6 8.2 8.5
1998 2.4 5.4 7.8 8.0
1999 -8.3 4.8 -3.5 -1.8
- ------------------------------------------------------------
</TABLE>
*Lehman Municipal Bond Index.
See Financial Highlights table on page 34 for dividend and capital gains
information for the past five years.
CUMULATIVE PERFORMANCE: OCTOBER 31, 1989-OCTOBER 31, 1999
- ------------------------------------------------------------
<TABLE>
<CAPTION>
CUMULATIVE PERFORMANCE: OCTOBER 31, 1989-OCTOBER 31, 1999
- -------------------------------------------------------------------------
Long-Term Average General Lehman Municipal
Tax-Exempt Municipal Debt Bond Index
Fund Fund*
<C> <C> <C> <C> <C>
1989 10 10000 10000 10000
1990 01 10124 10113 10210
1990 04 10044 10086 10230
1990 07 10698 10604 10700
1990 10 10610 10545 10742
1991 01 11192 10971 11154
1991 04 11437 11221 11405
1991 07 11652 11443 11635
1991 10 12131 11836 12049
1992 01 12440 12123 12370
1992 04 12574 12258 12489
1992 07 13606 13087 13233
1992 10 13047 12706 13060
1993 01 13806 13332 13585
1993 04 14465 13838 14069
1993 07 14655 14143 14403
1993 10 15257 14669 14898
1994 01 15607 14975 15251
1994 04 14654 13987 14372
1994 07 15049 14257 14677
1994 10 14416 13809 14254
1995 01 15083 14254 14713
1995 04 15701 14808 15334
1995 07 16197 15177 15834
1995 10 16721 15705 16370
1996 01 17451 16254 16927
1996 04 16985 15797 16553
1996 07 17395 16072 16879
1996 10 17842 16508 17303
1997 01 18074 16708 17577
1997 04 18181 16766 17650
1997 07 19210 17692 18609
1997 10 19310 17848 18772
1998 01 19962 18399 19354
1998 04 19822 18278 19291
1998 07 20298 18641 19724
1998 10 20812 19119 20278
1999 01 21199 19409 20641
1999 04 21175 19335 20632
1999 07 20706 18857 20292
1999 10 20093 18320 19919
</TABLE>
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED OCTOBER 31, 1999
------------------------------ FINAL VALUE OF A
1 YEAR 5 YEARS 10 YEARS $10,000 INVESTMENT
- ------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Long-Term Tax-Exempt Fund -3.45% 6.87% 7.23% $20,093
Average General Municipal Debt Fund* -4.18 5.82 6.24 18,320
Lehman Municipal Bond Index -1.77 6.92 7.13 19,919
- ------------------------------------------------------------------------------------------------
</TABLE>
*Derived from data provided by Lipper Inc.
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS: PERIODS ENDED SEPTEMBER 30, 1999*
- ------------------------------------------------------------------------------------------------
10 YEARS
INCEPTION -----------------------
DATE 1 YEAR 5 YEARS CAPITAL INCOME TOTAL
- ------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Long-Term Tax-Exempt Fund 9/1/1977 -2.49% 6.66% 1.40% 6.13% 7.53%
- ------------------------------------------------------------------------------------------------
</TABLE>
*SEC rules require that we provide this average annual total return information
through the latest calendar quarter.
23
<PAGE> 26
PERFORMANCE SUMMARY
HIGH-YIELD TAX-EXEMPT FUND
All of the data on this page represent past performance, which cannot be used
to predict future returns that may be achieved by the fund. Note, too, that
both share price and return can fluctuate widely, so an investment in the fund
could lose money.
<TABLE>
<CAPTION>
TOTAL INVESTMENT RETURNS: OCTOBER 31, 1979-OCTOBER 31, 1999
- ------------------------------------------------------------
HIGH-YIELD TAX-EXEMPT FUND LEHMAN*
FISCAL CAPITAL INCOME TOTAL TOTAL
YEAR RETURN RETURN RETURN RETURN
- ------------------------------------------------------------
<S> <C> <C> <C> <C>
1980 -15.3% 7.1% -8.2% N/A
1981 -19.4 9.0 -10.4 -11.4%
1982 16.1 13.7 29.8 31.6
1983 2.4 9.8 12.2 4.4
1984 -2.6 10.0 7.4 7.6
1985 8.5 10.4 18.9 18.7
1986 14.7 9.6 24.3 22.6
1987 -11.7 7.0 -4.7 -0.8
1988 10.1 8.7 18.8 14.6
1989 1.1 7.7 8.8 8.1
1990 -1.9 7.5 5.6 7.4
1991 7.2 8.0 15.2 12.2
1992 0.6 7.1 7.7 8.4
1993 10.0 6.8 16.8 14.1
1994 -10.5 5.5 -5.0 -4.3
1995 9.0 6.8 15.8 14.8
1996 0.3 5.7 6.0 5.7
1997 2.5 5.9 8.4 8.5
1998 2.6 5.6 8.2 8.0
1999 -7.8 5.0 -2.8 -1.8
- ------------------------------------------------------------
</TABLE>
*Lehman Municipal Bond Index.
See Financial Highlights table on page 34 for dividend and capital gains
information for the past five years.
CUMULATIVE PERFORMANCE: OCTOBER 31, 1989-OCTOBER 31, 1999
- ------------------------------------------------------------
<TABLE>
<CAPTION>
CUMULATIVE PERFORMANCE: OCTOBER 31, 1989-OCTOBER 31, 1999
- ------------------------------------------------------------
High-Yield Average High Yield Lehman Municipal
Tax-Exempt Municipal Debt Bond Index
Fund Fund*
<S> <C> <C> <C> <C>
1989 10 10000 10000 10000
1990 01 10123 10110 10210
1990 04 10042 10123 10230
1990 07 10706 10556 10700
1990 10 10557 10502 10742
1991 01 11077 10762 11154
1991 04 11376 11049 11405
1991 07 11642 11318 11635
1991 10 12165 11653 12049
1992 01 12450 11912 12370
1992 04 12617 12113 12489
1992 07 13639 12824 13233
1992 10 13102 12528 13060
1993 01 13869 13069 13585
1993 04 14500 13530 14069
1993 07 14719 13848 14403
1993 10 15303 14291 14898
1994 01 15640 14589 15251
1994 04 14795 13815 14372
1994 07 15148 14095 14677
1994 10 14533 13729 14254
1995 01 15163 14098 14713
1995 04 15807 14652 15334
1995 07 16308 15041 15834
1995 10 16835 15476 16370
1996 01 17414 16002 16927
1996 04 16999 15664 16553
1996 07 17407 15948 16879
1996 10 17851 16364 17303
1997 01 18107 16631 17577
1997 04 18183 16801 17650
1997 07 19174 17622 18609
1997 10 19343 17882 18772
1998 01 19992 18452 19354
1998 04 19917 18497 19291
1998 07 20406 18831 19724
1998 10 20926 19136 20278
1999 01 21320 19386 20641
1999 04 21336 19471 20632
1999 07 20915 19196 20292
1999 10 20347 18570 19919
</TABLE>
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED OCTOBER 31, 1999
------------------------------ FINAL VALUE OF A
1 YEAR 5 YEARS 10 YEARS $10,000 INVESTMENT
- --------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
High-Yield Tax-Exempt Fund -2.77% 6.96% 7.36% $20,347
Average High-Yield Municipal Debt Fund* -2.96 6.23 6.38 18,570
Lehman Municipal Bond Index -1.77 6.92 7.13 19,919
- --------------------------------------------------------------------------------------------------
</TABLE>
*Derived from data provided by Lipper Inc.
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS: PERIODS ENDED SEPTEMBER 30, 1999*
- --------------------------------------------------------------------------------------------------
10 YEARS
INCEPTION -----------------------
DATE 1 YEAR 5 YEARS CAPITAL INCOME TOTAL
- --------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
High-Yield Tax-Exempt Fund 12/27/1978 -1.51% 6.79% 1.21% 6.39% 7.60%
- --------------------------------------------------------------------------------------------------
</TABLE>
*SEC rules require that we provide this average annual total return information
through the latest calendar quarter.
24
<PAGE> 27
FINANCIAL STATEMENTS
OCTOBER 31, 1999
The Statements of Net Assets, integral parts of the Financial Statements for
each of the Vanguard Municipal Bond Funds, and the Report of Independent
Accountants are included as an insert to this report.
STATEMENT OF OPERATIONS
This Statement shows interest earned by each fund during the reporting period,
and details the operating expenses charged to the fund. These expenses directly
reduce the amount of investment income available to pay to shareholders as
tax-exempt income dividends. This Statement also shows any Net Gain (Loss)
realized on the sale of investments, and the increase or decrease in the
Unrealized Appreciation (Depreciation) on investments during the period. If a
fund invested in futures contracts during the period, the results of these
investments are shown separately.
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------
TAX-EXEMPT SHORT-TERM LIMITED-TERM INTERMEDIATE-TERM
MONEY MARKET TAX-EXEMPT TAX-EXEMPT TAX-EXEMPT
FUND FUND FUND FUND
- --------------------------------------------------------------------------------------------------
YEAR ENDED OCTOBER 31, 1999
- --------------------------------------------------------------------------------------------------
(000) (000) (000) (000)
- --------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
INVESTMENT INCOME
INCOME
Interest $216,332 $68,952 $111,042 $414,700
-------------------------------------------------------------
Total Income 216,332 68,952 111,042 414,700
-------------------------------------------------------------
EXPENSES
The Vanguard Group--Note B
Investment Advisory Services 826 219 310 1,019
Management and Administrative 9,910 2,580 3,747 12,475
Marketing and Distribution 1,554 412 513 1,431
Custodian Fees 68 18 23 68
Auditing Fees 12 9 10 13
Shareholders' Reports 59 18 27 106
Trustees' Fees and Expenses 8 2 3 11
-------------------------------------------------------------
Total Expenses 12,437 3,258 4,633 15,123
Expenses Paid Indirectly--Note C (68) (42) (85) (262)
-------------------------------------------------------------
Net Expenses 12,369 3,216 4,548 14,861
- --------------------------------------------------------------------------------------------------
NET INVESTMENT INCOME 203,963 65,736 106,494 399,839
- --------------------------------------------------------------------------------------------------
REALIZED NET GAIN (LOSS)
Investment Securities Sold (124) 495 568 (6,853)
Futures Contracts -- -- (419) 21,098
- --------------------------------------------------------------------------------------------------
REALIZED NET GAIN (LOSS) (124) 495 149 14,245
- --------------------------------------------------------------------------------------------------
CHANGE IN UNREALIZED APPRECIATION
(DEPRECIATION)
Investment Securities -- (19,834) (67,918) (478,537)
Futures Contracts -- -- 4,351 24,498
- --------------------------------------------------------------------------------------------------
CHANGE IN UNREALIZED APPRECIATION
(DEPRECIATION) -- (19,834) (63,567) (454,039)
- --------------------------------------------------------------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS $203,839 $46,397 $43,076 $ (39,955)
==================================================================================================
</TABLE>
25
<PAGE> 28
STATEMENT OF OPERATIONS (continued)
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------
INSURED LONG-TERM LONG-TERM HIGH-YIELD
TAX-EXEMPT TAX-EXEMPT TAX-EXEMPT
FUND FUND FUND
---------------------------------------------
YEAR ENDED OCTOBER 31, 1999
---------------------------------------------
(000) (000) (000)
- -----------------------------------------------------------------------------------------
<S> <C> <C> <C>
INVESTMENT INCOME
INCOME
Interest $122,201 $83,121 $161,880
---------------------------------------------
Total Income 122,201 83,121 161,880
---------------------------------------------
EXPENSES
The Vanguard Group--Note B
Investment Advisory Services 285 195 365
Management and Administrative 3,520 2,376 4,474
Marketing and Distribution 341 255 497
Custodian Fees 22 16 27
Auditing Fees 9 9 10
Shareholders' Reports 33 22 43
Trustees' Fees and Expenses 3 2 4
---------------------------------------------
Total Expenses 4,213 2,875 5,420
Expenses Paid Indirectly--Note C (91) (37) (88)
---------------------------------------------
Net Expenses 4,122 2,838 5,332
- -----------------------------------------------------------------------------------------
NET INVESTMENT INCOME 118,079 80,283 156,548
- -----------------------------------------------------------------------------------------
REALIZED NET GAIN (LOSS)
Investment Securities Sold (5,552) (4,233) (18,888)
Futures Contracts 16,252 8,452 20,359
- -----------------------------------------------------------------------------------------
REALIZED NET GAIN (LOSS) 10,700 4,219 1,471
- -----------------------------------------------------------------------------------------
CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION)
Investment Securities (192,304) (142,240) (249,465)
Futures Contracts 259 2,290 3,818
- -----------------------------------------------------------------------------------------
CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) (192,045) (139,950) (245,647)
- -----------------------------------------------------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING
FROM OPERATIONS $ (63,266) $(55,448) $ (87,628)
=========================================================================================
</TABLE>
26
<PAGE> 29
STATEMENT OF CHANGES IN NET ASSETS
This Statement shows how each fund's total net assets changed during the two
most recent reporting periods. The Operations section summarizes information
detailed in the Statement of Operations. Because the fund distributes its
income to shareholders each day, the amounts of Distributions--Net Investment
Income generally equal the net income earned as shown under the Operations
section. The amounts of Distributions--Realized Capital Gain may not match the
capital gains shown in the Operations section, because distributions are
determined on a tax basis and may be made in a period different from the one in
which the gains were realized on the financial statements. The Capital Share
Transactions section shows the amount shareholders invested in the fund, either
by purchasing shares or by reinvesting distributions, and the amounts redeemed.
The corresponding numbers of Shares Issued and Redeemed are shown at the end of
the Statement.
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------
TAX-EXEMPT SHORT-TERM
MONEY MARKET FUND TAX-EXEMPT FUND
------------------ ------------------
YEAR ENDED OCTOBER 31,
-----------------------------------------------
1999 1998 1999 1998
(000) (000) (000) (000)
- -----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
OPERATIONS
Net Investment Income $ 203,963 $ 193,699 $ 65,736 $ 60,583
Realized Net Gain (Loss) (124) 29 495 627
Change in Unrealized Appreciation -- -- (19,834) 6,658
(Depreciation)
----------------------------------------------------
Net Increase (Decrease) in Net
Assets Resulting from
Operations 203,839 193,728 46,397 67,868
----------------------------------------------------
DISTRIBUTIONS
Net Investment Income (203,963) (193,699) (65,736) (60,583)
Realized Capital Gain -- -- (624) (585)
----------------------------------------------------
Total Distributions (203,963) (193,699) (66,360) (61,168)
----------------------------------------------------
CAPITAL SHARE TRANSACTIONS(1)
Issued 8,274,792 6,814,946 1,121,980 947,896
Issued in Lieu of Cash
Distributions 190,776 181,732 56,651 51,299
Redeemed (7,566,794) (6,131,356) (919,627) (836,797)
----------------------------------------------------
Net Increase from Capital Share
Transactions 898,774 865,322 259,004 162,398
- -----------------------------------------------------------------------------------------
Total Increase (Decrease) 898,650 865,351 239,041 169,098
- -----------------------------------------------------------------------------------------
NET ASSETS
Beginning of Year 6,245,761 5,380,410 1,653,663 1,484,565
----------------------------------------------------
End of Year $7,144,411 $6,245,761 $1,892,704 $1,653,663
=========================================================================================
(1)Shares Issued (Redeemed)
Issued 8,274,792 6,814,946 72,029 60,783
Issued in Lieu of Cash
Distributions 190,776 181,732 3,640 3,290
Redeemed (7,566,794) (6,131,356) (59,043) (53,669)
----------------------------------------------------
Net Increase in Shares
Outstanding 898,774 865,322 16,626 10,404
=========================================================================================
</TABLE>
27
<PAGE> 30
STATEMENT OF CHANGES IN NET ASSETS (continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
LIMITED-TERM INTERMEDIATE-TERM
TAX-EXEMPT FUND TAX-EXEMPT FUND
------------------------ ------------------
YEAR ENDED OCTOBER 31,
----------------------------------------------------
1999 1998 1999 1998
(000) (000) (000) (000)
- -----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
OPERATIONS
Net Investment Income $ 106,494 $ 90,913 $ 399,839 $ 355,726
Realized Net Gain (Loss) 149 579 14,245 20,267
Change in Unrealized Appreciation
(Depreciation) (63,567) 22,307 (454,039) 98,989
----------------------------------------------------
Net Increase (Decrease) in
Net Assets
Resulting from Operations 43,076 113,799 (39,955) 474,982
----------------------------------------------------
DISTRIBUTIONS
Net Investment Income (106,494) (90,913) (399,839) (355,726)
Realized Capital Gain -- -- (20,547) (26,386)
----------------------------------------------------
Total Distributions (106,494) (90,913) (420,386) (382,112)
----------------------------------------------------
CAPITAL SHARE TRANSACTIONS(1)
Issued 1,062,991 927,565 2,371,429 1,986,864
Issued in Lieu of Cash
Distributions 83,769 71,458 317,269 286,110
Redeemed (846,527) (643,738) (1,773,115) (1,362,906)
----------------------------------------------------
Net Increase from Capital
Share Transactions 300,233 355,285 915,583 910,068
- -----------------------------------------------------------------------------------------
Total Increase (Decrease) 236,815 378,171 455,242 1,002,938
- -----------------------------------------------------------------------------------------
NET ASSETS
Beginning of Year 2,340,180 1,962,009 7,773,077 6,770,139
----------------------------------------------------
End of Year $2,576,995 $2,340,180 $8,228,319 $7,773,077
=========================================================================================
(1)Shares Issued (Redeemed)
Issued 98,675 86,051 178,445 147,963
Issued in Lieu of Cash
Distributions 7,792 6,626 23,965 21,322
Redeemed (78,694) (59,721) (134,015) (101,633)
----------------------------------------------------
Net Increase in Shares
Outstanding 27,773 32,956 68,395 67,652
=========================================================================================
</TABLE>
28
<PAGE> 31
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------
INSURED LONG-TERM LONG-TERM
TAX-EXEMPT FUND TAX-EXEMPT FUND
------------------- --------------------
YEAR ENDED OCTOBER 31,
----------------------------------------------
1999 1998 1999 1998
(000) (000) (000) (000)
- ------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
OPERATIONS
Net Investment Income $ 118,079 $ 110,968 $ 80,283 $ 70,509
Realized Net Gain (Loss) 10,700 4,877 4,219 13,447
Change in Unrealized Appreciation
(Depreciation) (192,045) 46,601 (139,950) 18,016
---------------------------------------------------
Net Increase (Decrease) in Net
Assets Resulting from
Operations (63,266) 162,446 (55,448) 101,972
---------------------------------------------------
DISTRIBUTIONS
Net Investment Income (118,079) (110,968) (80,283) (70,509)
Realized Capital Gain (12,271) (13,338) (15,575) (6,527)
---------------------------------------------------
Total Distributions (130,350) (124,306) (95,858) (77,036)
---------------------------------------------------
CAPITAL SHARE TRANSACTIONS(1)
Issued 410,769 358,616 436,934 380,652
Issued in Lieu of Cash Distributions 83,680 80,270 66,604 52,583
Redeemed (375,764) (285,010) (333,511) (198,533)
---------------------------------------------------
Net Increase from Capital Share
Transactions 118,685 153,876 170,027 234,702
- ------------------------------------------------------------------------------------------------
Total Increase (Decrease) (74,931) 192,016 18,721 259,638
- ------------------------------------------------------------------------------------------------
NET ASSETS
Beginning of Year 2,235,135 2,043,119 1,508,775 1,249,137
---------------------------------------------------
End of Year $2,160,204 $2,235,135 $1,527,496 $1,508,775
================================================================================================
(1)Shares Issued (Redeemed)
Issued 33,075 28,400 39,639 33,634
Issued in Lieu of Cash Distributions 6,763 6,361 6,046 4,653
Redeemed (30,568) (22,594) (30,394) (17,574)
---------------------------------------------------
Net Increase in Shares Outstanding 9,270 12,167 15,291 20,713
=================================================================================================
</TABLE>
29
<PAGE> 32
<TABLE>
<CAPTION>
STATEMENT OF CHANGES IN NET ASSETS (continued)
- ------------------------------------------------------------------------------------------------------
HIGH-YIELD TAX-EXEMPT FUND
YEAR ENDED OCTOBER 31,
--------------------------
1999 1998
(000) (000)
- ------------------------------------------------------------------------------------------------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
OPERATIONS
Net Investment Income $ 156,548 $ 130,990
Realized Net Gain (Loss) 1,471 8,508
Change in Unrealized Appreciation (Depreciation) (245,647) 54,301
-------------------------
Net Increase (Decrease) in Net Assets Resulting from Operations (87,628) 193,799
-------------------------
DISTRIBUTIONS
Net Investment Income (156,548) (130,990)
Realized Capital Gain (18,021) (10,865)
-------------------------
Total Distributions (174,569) (141,855)
-------------------------
CAPITAL SHARE TRANSACTIONS(1)
Issued 1,018,305 739,666
Issued in Lieu of Cash Distributions 121,185 97,798
Redeemed (714,278) (440,631)
-------------------------
Net Increase from Capital Share Transactions 425,212 396,833
- -----------------------------------------------------------------------------------------------------
Total Increase (Decrease) 163,015 448,777
- -----------------------------------------------------------------------------------------------------
NET ASSETS
Beginning of Year 2,704,349 2,255,572
-------------------------
End of Year $2,867,364 $2,704,349
=====================================================================================================
(1)Shares Issued (Redeemed)
Issued 94,318 67,558
Issued in Lieu of Cash Distributions 11,294 8,924
Redeemed (67,058) (40,243)
-------------------------
Net Increase in Shares Outstanding 38,554 36,239
=====================================================================================================
</TABLE>
30
<PAGE> 33
FINANCIAL HIGHLIGHTS
This table summarizes each fund's investment results and distributions to
shareholders on a per-share basis. It also presents the fund's Total Return and
shows net investment income and expenses as percentages of average net assets.
These data will help you assess: the variability of the fund's net income and
total returns from year to year; the relative contributions of net income and
capital gains to the fund's total return; how much it costs to operate the fund;
and the extent to which the fund tends to distribute capital gains. The table
also shows the Portfolio Turnover Rate, a measure of trading activity. A
turnover rate of 100% means that the average security is held in the fund for
one year. Money market funds are not required to report a Portfolio Turnover
Rate.
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------
TAX-EXEMPT MONEY MARKET FUND
YEAR ENDED OCTOBER 31, YEAR ENDED AUGUST 31,
--------------------- SEP. 1 TO --------------------------
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD 1999 1998 OCT. 31, 1997 1997 1996 1995
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
- -----------------------------------------------------------------------------------------------------------------------
INVESTMENT OPERATIONS
Net Investment Income .030 .034 .006 .034 .034 .036
Net Realized and Unrealized Gain (Loss)
on Investments -- -- -- -- -- --
------------------------------------------------------------------
Total from Investment Operations .030 .034 .006 .034 .034 .036
------------------------------------------------------------------
DISTRIBUTIONS
Dividends from Net Investment Income (.030) (.034) (.006) (.034) (.034) (.036)
Distributions from Realized Capital Gains -- -- -- -- -- --
------------------------------------------------------------------
Total Distributions (.030) (.034) (.006) (.034) (.034) (.036)
- -----------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
=======================================================================================================================
TOTAL RETURN 3.08% 3.44% 0.59% 3.47% 3.48% 3.63%
=======================================================================================================================
RATIOS/SUPPLEMENTAL DATA
Net Assets, End of Period (Millions) $7,144 $6,246 $5,380 $5,345 $4,624 $4,166
Ratio of Total Expenses to Average Net Assets 0.18% 0.20% 0.18%* 0.19% 0.20% 0.22%
Ratio of Net Investment Income to
Average Net Assets 3.03% 3.37% 3.53%* 3.41% 3.42% 3.56%
=======================================================================================================================
*Annualized.
</TABLE>
31
<PAGE> 34
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS (continued)
- ---------------------------------------------------------------------------------------------------------------------------
SHORT-TERM TAX-EXEMPT FUND
YEAR ENDED OCTOBER 31, YEAR ENDED AUGUST 31,
---------------------- SEP. 1 TO ----------------------------
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD 1999 1998 OCT. 31, 1997 1997 1996 1995
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $15.65 $15.58 $15.57 $15.54 $15.59 $15.46
- ---------------------------------------------------------------------------------------------------------------------------
INVESTMENT OPERATIONS
Net Investment Income .578 .609 .103 .610 .609 .600
Net Realized and Unrealized Gain (Loss)
on Investments (.164) .076 .010 .034 (.050) .131
--------------------------------------------------------------------
Total from Investment Operations .414 .685 .113 .644 .559 .731
--------------------------------------------------------------------
DISTRIBUTIONS
Dividends from Net Investment Income (.578) (.609) (.103) (.610) (.609) (.600)
Distributions from Realized Capital Gains (.006) (.006) -- (.004) -- (.001)
--------------------------------------------------------------------
Total Distributions (.584) (.615) (.103) (.614) (.609) (.601)
- ---------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $15.48 $15.65 $15.58 $15.57 $15.54 $15.59
===========================================================================================================================
TOTAL RETURN 2.69% 4.49% 0.73% 4.22% 3.64% 4.83%
===========================================================================================================================
RATIOS/SUPPLEMENTAL DATA
Net Assets, End of Period (Millions) $1,893 $1,654 $1,485 $1,464 $1,457 $1,442
Ratio of Total Expenses to Average Net Assets 0.18% 0.20% 0.18%* 0.19% 0.20% 0.22%
Ratio of Net Investment Income to
Average Net Assets 3.71% 3.90% 3.96%* 3.91% 3.90% 3.88%
Portfolio Turnover Rate 56% 36% 4% 34% 33% 32%
===========================================================================================================================
*Annualized.
- ---------------------------------------------------------------------------------------------------------------------------
LIMITED-TERM TAX-EXEMPT FUND
YEAR ENDED OCTOBER 31, YEAR ENDED AUGUST 31,
---------------------- SEP. 1 TO -----------------------
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD 1999 1998 OCT. 31, 1997 1997 1996 1995
- ---------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $10.85 $10.74 $10.71 $10.62 $10.71 $10.57
- ---------------------------------------------------------------------------------------------------------------------------
INVESTMENT OPERATIONS
Net Investment Income .457 .460 .078 .476 .483 .476
Net Realized and Unrealized Gain (Loss)
on Investments (.260) .110 .030 .090 (.090) .140
----------------------------------------------------------------
Total from Investment Operations .197 .570 .108 .566 .393 .616
----------------------------------------------------------------
DISTRIBUTIONS
Dividends from Net Investment Income (.457) (.460) (.078) (.476) (.483) (.476)
Distributions from Realized Capital Gains -- -- -- -- -- --
----------------------------------------------------------------
Total Distributions (.457) (.460) (.078) (.476) (.483) (.476)
- ---------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $10.59 $10.85 $10.74 $10.71 $10.62 $10.71
===========================================================================================================================
TOTAL RETURN 1.83% 5.42% 1.01% 5.44% 3.73% 5.99%
===========================================================================================================================
RATIOS/SUPPLEMENTAL DATA
Net Assets, End of Period (Millions) $2,577 $2,340 $1,962 $1,929 $1,761 $1,669
Ratio of Total Expenses to Average Net Assets 0.18% 0.21% 0.18%* 0.19% 0.21% 0.22%
Ratio of Net Investment Income to
Average Net Assets 4.25% 4.27% 4.34%* 4.46% 4.51% 4.51%
Portfolio Turnover Rate 14% 35% 2% 28% 27% 35%
===========================================================================================================================
*Annualized.
</TABLE>
32
<PAGE> 35
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------------------
INTERMEDIATE-TERM TAX-EXEMPT FUND
YEAR ENDED OCTOBER 31, YEAR ENDED AUGUST 31,
---------------------- SEP. 1 TO -------------------------
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD 1999 1998 OCT. 31, 1997 1997 1996 1995
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $13.52 $13.35 $13.30 $13.04 $13.14 $13.02
- --------------------------------------------------------------------------------------------------------------------------
INVESTMENT OPERATIONS
Net Investment Income .648 .661 .111 .669 .671 .686
Net Realized and Unrealized Gain (Loss)
on Investments (.695) .222 .050 .263 (.091) .278
----------------------------------------------------------------------
Total from Investment Operations (.047) .883 .161 .932 .580 .964
----------------------------------------------------------------------
DISTRIBUTIONS
Dividends from Net Investment Income (.648) (.661) (.111) (.669) (.671) (.686)
Distributions from Realized Capital Gains (.035) (.052) -- (.003) (.009) (.158)
----------------------------------------------------------------------
Total Distributions (.683) (.713) (.111) (.672) (.680) (.844)
- --------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $12.79 $13.52 $13.35 $13.30 $13.04 $13.14
==========================================================================================================================
TOTAL RETURN -0.40% 6.78% 1.21% 7.31% 4.47% 7.82%
==========================================================================================================================
RATIOS/SUPPLEMENTAL DATA
Net Assets, End of Period (Millions) $8,228 $7,773 $6,770 $6,658 $5,927 $5,448
Ratio of Total Expenses to Average Net Assets 0.18% 0.21% 0.18%* 0.19% 0.20% 0.22%
Ratio of Net Investment Income to
Average Net Assets 4.83% 4.93% 4.99%* 5.07% 5.09% 5.35%
Portfolio Turnover Rate 17% 14% 1% 15% 14% 12%
==========================================================================================================================
*Annualized.
- --------------------------------------------------------------------------------------------------------------------------
LONG-TERM TAX-EXEMPT FUND
YEAR ENDED OCTOBER 31, YEAR ENDED AUGUST 31,
---------------------- SEP. 1 TO -------------------------
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD 1999 1998 OCT. 31, 1997 1997 1996 1995
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $12.73 $12.51 $12.45 $12.14 $12.12 $11.98
- --------------------------------------------------------------------------------------------------------------------------
INVESTMENT OPERATIONS
Net Investment Income .644 .658 .111 .674 .670 .684
Net Realized and Unrealized Gain (Loss)
on Investments (.971) .301 .060 .382 .020 .313
---------------------------------------------------------------
Total from Investment Operations (.327) .959 .171 1.056 .690 .997
---------------------------------------------------------------
DISTRIBUTIONS
Dividends from Net Investment Income (.644) (.658) (.111) (.674) (.670) (.684)
Distributions from Realized Capital Gains (.069) (.081) -- (.072) -- (.173)
---------------------------------------------------------------
Total Distributions (.713) (.739) (.111) (.746) (.670) (.857)
- --------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $11.69 $12.73 $12.51 $12.45 $12.14 $12.12
==========================================================================================================================
TOTAL RETURN -2.74% 7.88% 1.37% 8.93% 5.77% 8.88%
==========================================================================================================================
RATIOS/SUPPLEMENTAL DATA
Net Assets, End of Period (Millions) $2,160 $2,235 $2,043 $2,024 $1,936 $1,935
Ratio of Total Expenses to
Average Net Assets 0.19% 0.20% 0.18%* 0.19% 0.20% 0.22%
Ratio of Net Investment Income to
Average Net Assets 5.20% 5.22% 5.32%* 5.47% 5.46% 5.82%
Portfolio Turnover Rate 17% 16% 1% 18% 18% 7%
==========================================================================================================================
*Annualized.
</TABLE>
33
<PAGE> 36
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS (continued)
- --------------------------------------------------------------------------------------------------------------------------
LONG-TERM TAX-EXEMPT FUND
YEAR ENDED OCTOBER 31, YEAR ENDED AUGUST 31,
---------------------- SEP. 1 TO -------------------------
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD 1999 1998 OCT. 31, 1997 1997 1996 1995
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $11.39 $11.18 $11.11 $10.73 $10.68 $10.58
- --------------------------------------------------------------------------------------------------------------------------
INVESTMENT OPERATIONS
Net Investment Income .565 .580 .098 .588 .591 .608
Net Realized and Unrealized Gain (Loss)
on Investments (.935) .268 .070 .403 .050 .256
-----------------------------------------------------------------
Total from Investment Operations (.370) .848 .168 .991 .641 .864
DISTRIBUTIONS -----------------------------------------------------------------
Dividends from Net Investment Income (.565) (.580) (.098) (.588) (.591) (.608)
Distributions from Realized Capital Gains (.115) (.058) -- (.023) -- (.156)
-----------------------------------------------------------------
Total Distributions (.680) (.638) (.098) (.611) (.591) (.764)
- --------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $10.34 $11.39 $11.18 $11.11 $10.73 $10.68
==========================================================================================================================
TOTAL RETURN -3.45% 7.78% 1.52% 9.46% 6.08% 8.74%
==========================================================================================================================
RATIOS/SUPPLEMENTAL DATA
Net Assets, End of Period (Millions) $1,527 $1,509 $1,249 $1,222 $1,110 $1,054
Ratio of Total Expenses to Average Net Assets 0.18% 0.21% 0.18%* 0.19% 0.20% 0.23%
Ratio of Net Investment Income to
Average Net Assets 5.13% 5.13% 5.28%* 5.37% 5.45% 5.87%
Portfolio Turnover Rate 15% 18% 1% 9% 26% 35%
==========================================================================================================================
*Annualized.
</TABLE>
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------------------
HIGH-YIELD TAX-EXEMPT FUND
YEAR ENDED OCTOBER 31, YEAR ENDED AUGUST 31,
---------------------- SEP. 1 TO ------------------------
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD 1999 1998 OCT. 31, 1997 1997 1996 1995
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $11.06 $10.83 $10.76 $10.39 $10.43 $10.39
- --------------------------------------------------------------------------------------------------------------------------
INVESTMENT OPERATIONS
Net Investment Income .571 .582 .106 .589 .594 .625
Net Realized and Unrealized Gain (Loss)
on Investments (.858) .282 .070 .370 (.040) .213
-------------------------------------------------------------------
Total from Investment Operations (.287) .864 .176 .959 .554 .838
-------------------------------------------------------------------
DISTRIBUTIONS
Dividends from Net Investment Income (.571) (.582) (.106) (.589) (.594) (.625)
Distributions from Realized Capital Gains (.072) (.052) -- -- -- (.173)
-------------------------------------------------------------------
Total Distributions (.643) (.634) (.106) (.589) (.594) (.798)
- --------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $10.13 $11.06 $10.83 $10.76 $10.39 $10.43
==========================================================================================================================
TOTAL RETURN -2.77% 8.19% 1.63% 9.45% 5.39% 8.69%
==========================================================================================================================
RATIOS/SUPPLEMENTAL DATA
Net Assets, End of Period (Millions) $2,867 $2,704 $2,256 $2,193 $1,985 $1,865
Ratio of Total Expenses to Average Net Assets 0.18% 0.20% 0.19%* 0.19% 0.20% 0.22%
Ratio of Net Investment Income to
Average Net Assets 5.33% 5.28% 6.08%* 5.56% 5.66% 6.15%
Portfolio Turnover Rate 22% 24% 3% 27% 19% 33%
==========================================================================================================================
*Annualized.
</TABLE>
34
<PAGE> 37
NOTES TO FINANCIAL STATEMENTS
Vanguard Municipal Bond Funds comprise the Tax-Exempt Money Market, Short-Term
Tax-Exempt, Limited-Term Tax-Exempt, Intermediate-Term Tax-Exempt, Insured
Long-Term Tax-Exempt, Long-Term Tax-Exempt, and High-Yield Tax-Exempt Funds,
each of which is registered under the Investment Company Act of 1940 as a
diversified open-end investment company, or mutual fund. Each fund invests in
debt instruments of many municipal issuers; the issuers' abilities to meet their
obligations may be affected by economic and political developments in a specific
state or region. Effective in 1997, each fund's fiscal year changed from August
31 to October 31.
A. The following significant accounting policies conform to generally accepted
accounting principles for mutual funds. The funds consistently follow such
policies in preparing their financial statements.
1. SECURITY VALUATION: Tax-Exempt Money Market Fund: Investment securities
are valued at amortized cost, which approximates market value. Other funds:
Bonds, and temporary cash investments acquired over 60 days to maturity, are
valued using the latest bid prices or using valuations based on a matrix system
(which considers such factors as security prices, yields, maturities, and
ratings), both as furnished by independent pricing services. Other temporary
cash investments are valued at amortized cost, which approximates market value.
2. FEDERAL INCOME TAXES: Each fund intends to continue to qualify as a
regulated investment company and distribute all of its income. Accordingly, no
provision for federal income taxes is required in the financial statements.
3. FUTURES CONTRACTS: Each fund, except the Tax-Exempt Money Market Fund,
may use Municipal Bond Index, U.S. Treasury Bond, and U.S. Treasury Note futures
contracts to a limited extent, with the objectives of enhancing returns,
managing interest-rate risk, maintaining liquidity, diversifying credit risk,
and minimizing transaction costs. The funds may purchase or sell futures
contracts instead of bonds to take advantage of pricing differentials between
the futures contracts and the underlying bonds. The funds may also seek to take
advantage of price differences among bond market sectors by simultaneously
buying futures (or bonds) of one market sector and selling futures (or bonds) of
another sector. Futures contracts may also be used to simulate a fully invested
position in the underlying bonds while maintaining a cash balance for liquidity.
The primary risks associated with the use of futures contracts are imperfect
correlation between changes in market values of bonds held by the funds and the
prices of futures contracts, and the possibility of an illiquid market.
Futures contracts are valued based upon their quoted daily settlement
prices. The aggregate principal amounts of the contracts are not recorded in the
financial statements. Fluctuations in the values of futures contracts are
recorded in the Statement of Net Assets as an asset (liability) and in the
Statement of Operations as unrealized appreciation (depreciation) until the
contracts are closed, when they are recorded as realized futures gains (losses).
4. DISTRIBUTIONS: Distributions from net investment income are declared
daily and paid on the first business day of the following month. Annual
distributions from realized capital gains, if any, are recorded on the
ex-dividend date.
5. OTHER: Security transactions are accounted for on the date securities
are bought or sold. Costs used to determine realized gains (losses) on the sale
of investment securities are those of the specific securities sold. Premiums and
original issue discounts are amortized and accreted, respectively, to interest
income over the lives of the respective securities.
B. The Vanguard Group furnishes at cost investment advisory, corporate
management, administrative, marketing, and distribution services. The costs of
such services are allocated to each fund under methods approved by the Board of
Trustees. Each fund has committed to provide up to
35
<PAGE> 38
NOTES TO FINANCIAL STATEMENTS (continued)
0.40% of its net assets in capital contributions to Vanguard. At October 31,
1999, the funds had contributed capital to Vanguard (included in Other Assets)
of: 0.40% of its net assets in capital contributions to Vanguard. At October 31,
1999, the funds had contributed capital to Vanguard (included in Other Assets)
of:
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------
CAPITAL CONTRIBUTION PERCENTAGE PERCENTAGE OF
TO VANGUARD OF FUND VANGUARD'S
TAX-EXEMPT FUND (000) NET ASSETS CAPITALIZATION
- -----------------------------------------------------------------------------------
<S> <C> <C> <C>
Money Market $1,530 0.02% 1.5%
Short-Term 400 0.02 0.4
Limited-Term 560 0.02 0.6
Intermediate-Term 1,800 0.02 1.8
Insured Long-Term 480 0.02 0.5
Long-Term 340 0.02 0.3
High-Yield 640 0.02 0.6
- -----------------------------------------------------------------------------------
</TABLE>
The funds' Trustees and officers are also Directors and officers of Vanguard.
C. The funds' investment adviser may direct new issue purchases, subject to
obtaining the best price and execution, to underwriters who have agreed to
rebate or credit to the funds part of the underwriting fees generated. Such
rebates or credits are used solely to reduce the funds' management and
administrative expenses. The funds' custodian bank has also agreed to reduce its
fees when the funds maintain cash on deposit in their non-interest-bearing
custody accounts. For the year ended October 31, 1999, these arrangements
reduced expenses by:
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------
EXPENSE REDUCTION
(000)
---------------------------------
MANAGEMENT AND CUSTODIAN
TAX-EXEMPT FUND ADMINISTRATIVE FEES
- -----------------------------------------------------------------------------------
<S> <C> <C>
Money Market -- $68
Short-Term $ 24 18
Limited-Term 62 23
Intermediate-Term 194 68
Insured Long-Term 69 22
Long-Term 21 16
High-Yield 61 27
- -----------------------------------------------------------------------------------
</TABLE>
D. During the year ended October 31, 1999, purchases and sales of investment
securities other than temporary cash investments were:
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------
(000)
--------------------------------
TAX-EXEMPT FUND PURCHASES SALES
- -----------------------------------------------------------------------------------
<S> <C> <C>
Short-Term $1,072,393 $ 852,377
Limited-Term 666,368 341,851
Intermediate-Term 1,986,659 1,367,744
Insured Long-Term 585,692 377,207
Long-Term 421,127 229,279
High-Yield 1,033,026 625,369
- -----------------------------------------------------------------------------------
</TABLE>
36
<PAGE> 39
E. Capital gains distributions are determined on a tax basis and may differ from
realized capital gains for financial reporting purposes due to differences in
the timing of realization of gains. At October 31, 1999, the following funds had
capital losses to offset future capital gains through the following fiscal
year-ends:
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------
CAPITAL LOSS
----------------------------------
AMOUNT EXPIRATION: FISCAL YEAR(S)
TAX-EXEMPT FUND (000) ENDING OCTOBER 31
- -----------------------------------------------------------------------------------
<S> <C> <C>
Money Market $ (738) 2002-2007
Limited-Term (909) 2003-2006
Insured Long-Term (1,557) 2007
Long-Term (1,908) 2007
High-Yield (10,705) 2007
- -----------------------------------------------------------------------------------
</TABLE>
The Short-Term and Intermediate-Term Tax Exempt Funds plan to use a tax
accounting practice to apply a portion of the price of capital shares redeemed
during the year to eliminate capital gain distribution requirements of $452,000
and $1,897,000, respectively.
The following funds had realized losses through October 31, 1999, which are
deferred for tax purposes and reduce the amount of unrealized appreciation
(depreciation) on investment securities for tax purposes (see Note F).
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------
DEFERRED LOSSES
TAX-EXEMPT FUND (000)
- -----------------------------------------------------------------------------------
<S> <C>
Limited-Term $ 806
Intermediate-Term 40,564
Insured Long-Term 27,174
Long-Term 11,616
High-Yield 18,948
- -----------------------------------------------------------------------------------
</TABLE>
F. At October 31, 1999, net unrealized appreciation (depreciation) of investment
securities for federal income tax purposes was:
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------
(000)
--------------------------------------------------
NET
UNREALIZED
APPRECIATED DEPRECIATED APPRECIATION
TAX-EXEMPT FUND SECURITIES SECURITIES (DEPRECIATION)
- -----------------------------------------------------------------------------------
<S> <C> <C> <C>
Short-Term $ 1,240 $ (7,405) $ (6,165)
Limited-Term* 7,598 (24,884) (17,286)
Intermediate-Term* 116,021 (160,053) (44,032)
Insured Long-Term* 64,928 (49,773) 15,155
Long-Term* 37,577 (62,176) (24,599)
High-Yield* 62,126 (133,620) (71,494)
- -----------------------------------------------------------------------------------
*See Note E.
</TABLE>
37
<PAGE> 40
<TABLE>
<CAPTION>
THE VANGUARD FAMILY OF FUNDS
STOCK FUNDS
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
500 Index Fund Growth Index Fund* Tax-Managed Capital
Aggressive Growth Fund Health Care Fund Appreciation Fund*
Capital Opportunity Fund Institutional Index Fund* Tax-Managed Growth and
Convertible Securities Fund International Growth Fund Income Fund*
Emerging Markets Stock International Value Fund Tax-Managed Small-Cap Fund*
Index Fund Mid-Cap Index Fund* Total International Stock
Energy Fund Morgan Growth Fund Index Fund
Equity Income Fund Pacific Stock Index Fund Total Stock Market Index Fund*
European Stock Index Fund PRIMECAP Fund U.S. Growth Fund
Explorer Fund REIT Index Fund Utilities Income Fund
Extended Market Index* Selected Value Fund Value Index Fund*
Global Equity Fund Small-Cap Growth Index Fund* Windsor Fund
Gold and Precious Metals Fund Small-Cap Index Fund* Windsor II Fund
Growth and Income Fund Small-Cap Value Index Fund*
BALANCED FUNDS
- ---------------------------------------------------------------------------------------------------------------------
Asset Allocation Fund LifeStrategy Growth Fund STAR Fund
Balanced Index Fund LifeStrategy Income Fund Tax-Managed Balanced Fund
Global Asset Allocation Fund LifeStrategy Moderate Wellesley Income Fund
LifeStrategy Conservative Growth Fund Wellington Fund
Growth Fund
BOND FUNDS
- ----------------------------------------------------------------------------------------------------------------------
Admiral Intermediate-Term Intermediate-Term Corporate Fund Short-Term Corporate Fund*
Treasury Fund Intermediate-Term Tax-Exempt Short-Term Federal Fund
Admiral Long-Term Treasury Fund Fund Short-Term Tax-Exempt Fund
Admiral Short-Term Treasury Fund Intermediate-Term Treasury Fund Short-Term Treasury Fund
GNMA Fund Limited-Term Tax-Exempt Fund State Tax-Exempt Bond Funds
High-Yield Corporate Fund Long-Term Bond Index Fund (California, Florida,
High-Yield Tax-Exempt Fund Long-Term Corporate Fund Massachusetts, New Jersey,
Insured Long-Term Tax-Exempt Long-Term Tax-Exempt Fund New York, Ohio, Pennsylvania)
Fund Long-Term Treasury Fund Total Bond Market Index Fund*
Intermediate-Term Bond Preferred Stock Fund
Index Fund Short-Term Bond Index Fund
MONEY MARKET FUNDS
- ----------------------------------------------------------------------------------------------------------------------
Admiral Treasury Money State Tax-Exempt Money Market Tax-Exempt Money Market Fund
Market Fund Funds (California, New Jersey, Treasury Money Market Fund
Federal Money Market Fund New York, Ohio, Pennsylvania)
Prime Money Market Fund*
VARIABLE ANNUITY PLAN
- ----------------------------------------------------------------------------------------------------------------------
Balanced Portfolio High-Grade Bond Portfolio Money Market Portfolio
Diversified Value Portfolio High Yield Bond Portfolio REIT Index Portfolio
Equity Income Portfolio International Portfolio Short-Term Corporate Portfolio
Equity Index Portfolio Mid-Cap Index Portfolio Small Company Growth Portfolio
Growth Portfolio
</TABLE>
*Offers Institutional Shares.
38
<PAGE> 41
THE PEOPLE WHO GOVERN YOUR FUND
The Trustees of your mutual fund are there to see that the fund is operated and
managed in your best interests since, as a shareholder, you are part owner of
the fund. Your fund Trustees also serve on the Board of Directors of The
Vanguard Group, which is owned by the funds and exists solely to provide
services to them on an at-cost basis.
The majority of Vanguard's board members are independent, meaning that they
have no affiliation with Vanguard or the funds they oversee, apart from the
sizable personal investments they have made as private individuals. They bring
distinguished backgrounds in business, academia, and public service to their
task of working with Vanguard officers to establish the policies and oversee
the activities of the funds.
Among board members' responsibilities are selecting investment advisers for
the funds; monitoring fund operations, performance, and costs; reviewing
contracts; nominating and selecting new Trustees/Directors; and electing
Vanguard officers.
The list below provides a brief description of each Trustee's professional
affiliations. Noted in parentheses is the year in which the Trustee joined the
Vanguard Board.
TRUSTEES
JOHN C. BOGLE - (1967) Founder, Senior Chairman of the Board, and
Director/Trustee of The Vanguard Group, Inc., and each of the investment
companies in The Vanguard Group.
JOHN J. BRENNAN - (1987) Chairman of the Board, Chief Executive Officer, and
Director/Trustee of The Vanguard Group, Inc., and each of the investment
companies in The Vanguard Group.
JOANN HEFFERNAN HEISEN - (1998) Vice President, Chief Information Officer, and a
member of the Executive Committee of Johnson & Johnson; Director of Johnson &
JohnsonoMerck Consumer Pharmaceuticals Co., The Medical Center at Princeton, and
Women's Research and Education Institute.
BURTON G. MALKIEL - (1977) Chemical Bank Chairman's Professor of Economics,
Princeton University; Director of Prudential Insurance Co. of America, Banco
Bilbao Gestinova, Baker Fentress & Co., The Jeffrey Co., and Select Sector SPDR
Trust.
ALFRED M. RANKIN, JR. - (1993) Chairman, President, Chief Executive Officer,
and Director of NACCO Industries, Inc.; Director of The BFGoodrich Co.
JOHN C. SAWHILL - (1991) President and Chief Executive Officer of The Nature
Conservancy; formerly, Director and Senior Partner of McKinsey & Co. and
President of New York University; Director of Pacific Gas and Electric Co.,
Procter & Gamble Co., NACCO Industries, and Newfield Exploration Co.
JAMES O. WELCH, JR. - (1971) Retired Chairman of Nabisco Brands, Inc.; retired
Vice Chairman and Director of RJR Nabisco; Director of TECO Energy, Inc., and
Kmart Corp.
J. LAWRENCE WILSON - (1985) Retired Chairman of Rohm & Haas Co.; Director of
Cummins Engine Co. and The Mead Corp.; Trustee of Vanderbilt University.
OTHER FUND OFFICERS
RAYMOND J. KLAPINSKY - Secretary; Managing Director and Secretary of The
Vanguard Group, Inc.; Secretary of each of the investment companies in The
Vanguard Group.
THOMAS J. HIGGINS - Treasurer; Principal of The Vanguard Group, Inc.; Treasurer
of each of the investment companies in The Vanguard Group.
VANGUARD MANAGING DIRECTORS
R. GREGORY BARTON - Legal Department.
ROBERT A. DISTEFANO - Information Technology.
JAMES H. GATELY - Individual Investor Group.
KATHLEEN C. GUBANICH - Human Resources.
IAN A. MACKINNON - Fixed Income Group.
F. WILLIAM MCNABB, III - Institutional Investor Group.
MICHAEL S. MILLER - Planning and Development.
RALPH K. PACKARD - Chief Financial Officer.
GEORGE U. SAUTER - Core Management Group.
<PAGE> 42
ABOUT OUR COVER
Our cover art, depicting HMS Vanguard at sea, is a reproduction of Leading the
Way, a 1984 work created and copyrighted by noted naval artist Tom Freeman, of
Forest Hill, Maryland.
Post Office Box 2600
Valley Forge, Pennsylvania 19482-2600
All comparative mutual fund data are from Lipper Inc. or Morningstar, Inc.,
unless otherwise noted.
"Standard & Poor's(R)," "S&P(R)," "S&P 500(R)," "Standard & Poor's 500," and
"500" are trademarks of The McGraw-Hill Companies, Inc.
Frank Russell Company is the owner of trademarks and copyrights relating to the
Russell Indexes. "Wilshire 4500" and "Wilshire 5000" are trademarks of Wilshire
Associates.
[VANGUARD LOGO]
WORLD WIDE WEB
www.vanguard.com
FUND INFORMATION
1-800-662-7447
INDIVIDUAL ACCOUNT SERVICES
1-800-662-2739
INSTITUTIONAL INVESTOR SERVICES
1-800-523-1036
This report is intended for the fund's shareholders. It may not be distributed
to prospective investors unless it is preceded or accompanied by the current
fund prospectus.
Q950-12/21/1999
(C) 1999 The Vanguard Group, Inc.
All rights reserved.
Vanguard Marketing
Corporation, Distributor.
<PAGE> 43
VANGUARD MUNICIPAL BOND FUNDS
STATEMENT OF NET ASSETS - OCTOBER 31, 1999
The Statement of Net Assets should be read in conjunction with the Statement of
Operations, Statement of Changes in Net Assets, Financial Highlights, and Notes
to Financial Statements, all of which appear in the accompanying report.
This Statement provides a detailed list of each fund's municipal bond
holdings by state, including each security's market value on the last day of the
reporting period and information on credit enhancements such as insurance or
letters of credit. Other assets are added to, and liabilities are subtracted
from, the value of Total Municipal Bonds to calculate the fund's Net Assets.
Finally, Net Assets are divided by the outstanding shares of the fund to arrive
at its share price, or Net Asset Value (NAV) Per Share.
At the end of the Statement of Net Assets of each fund, you will find a
table displaying the composition of the fund's net assets on both a dollar and
per-share basis. Undistributed Net Investment Income is usually zero because the
fund distributes its net income to shareholders as a dividend each day. Any
realized gains must be distributed annually, so the bulk of net assets consists
of Paid in Capital (money invested by shareholders). The balance shown for
Accumulated Net Realized Gains usually approximates the amount available to
distribute to shareholders as taxable capital gains as of the statement date,
but may differ because certain investments or transactions may be treated
differently for financial statement and tax purposes. Any Accumulated Net
Realized Losses, and any cumulative excess of distributions over net realized
gains, will appear as negative balances. Unrealized Appreciation (Depreciation)
is the difference between the value of the fund's investments and their cost,
and reflects the gains (losses) that would be realized if the fund were to sell
all of its investments at their statement-date values.
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------------------
CONTENTS
<S> <C>
Tax-Exempt Money Market Fund............................1
Short-Term Tax-Exempt Fund.............................11
Limited-Term Tax-Exempt Fund...........................18
Intermediate-Term Tax-Exempt Fund......................27
Insured Long-Term Tax-Exempt Fund......................46
Long-Term Tax-Exempt Fund..............................53
High-Yield Tax-Exempt Fund.............................59
Key to Abbreviations...................................67
Report of Independent Accountants......................68
- --------------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
FACE MARKET
MATURITY AMOUNT VALUE*
TAX-EXEMPT MONEY MARKET FUND COUPON DATE (000) (000)
- ---------------------------------------------------------------------------------------------------------------------------
MUNICIPAL BONDS (102.5%)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
ALABAMA (2.7%)
Alabama GO 5.50% 10/1/2000 $ 5,000 $ 5,071
Alabama Public School and College Auth. TOB VRDO 3.52% 11/3/1999 (3) 5,000 5,000
Alabama Special Care Fac. Finance Auth. Rev. VRDO
(Montgomery Hosp.) 3.50% 11/3/1999 (3) 17,900 17,900
Birmingham AL GO VRDO 3.45% 11/3/1999 LOC 28,900 28,900
Birmingham AL GO VRDO 3.45% 11/4/1999 LOC 21,100 21,100
Birmingham AL GO VRDO 3.50% 11/3/1999 (2) LOC 35,200 35,200
Jefferson County AL GO Warrants VRDO 3.52% 11/3/1999 LOC 40,000 40,000
Mobile AL IDR VRDO (Kimberly-Clark Tissue Co. Project) 3.50% 11/3/1999 33,550 33,550
Mobile AL Port City Clinic Board CP
(Infirmary Health System Inc.) 3.60% 11/4/1999 (2) 7,000 7,000
----------
193,721
----------
ALASKA (1.3%)
Alaska Housing Finance Corp. TOB VRDO 3.57% 11/4/1999 6,505 6,505
Anchorage AK Electric Util. Rev. VRDO (Muni. Light & Power) 3.45% 11/3/1999 LOC 17,500 17,500
Valdez AK Marine Terminal Rev. VRDO (Exxon Pipeline Co. Project) 3.50% 11/2/1999 41,000 41,000
Valdez AK Marine Terminal Rev. VRDO
(Mobil Alaska Pipeline Co. Project) 3.50% 11/3/1999 28,650 28,650
----------
93,655
----------
</TABLE>
1
<PAGE> 44
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
FACE MARKET
MATURITY AMOUNT VALUE*
TAX-EXEMPT MONEY MARKET FUND COUPON DATE (000) (000)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
ARIZONA (2.1%)
Arizona Health Fac. Auth. Rev. VRDO (Samaritan Health Services) 3.45% 11/4/1999 (3) $15,415 $ 15,415
Arizona Transp. Board Excise Tax Rev.
(Maricopa County Regional Area Road Fund) 4.75% 7/1/2000 (2) 16,995 17,142
Maricopa County AZ PCR VRDO (Arizona Public Service Palo Verde) 3.50% 11/2/1999 LOC 7,300 7,300
Mesa AZ IDA VRDO (Discovery Health) 3.55% 11/3/1999 (1) 14,300 14,300
Phoenix AZ GO 4.70% 7/1/2000 2,500 2,523
Salt River Project Agricultural Improvement & Power Dist. AZ CP 3.40% 11/9/1999 18,900 18,900
Salt River Project Agricultural Improvement & Power Dist. AZ CP 3.60% 11/4/1999 3,100 3,100
Salt River Project Agricultural Improvement & Power Dist. AZ CP 3.70% 3/14/2000 28,900 28,900
Salt River Project Agricultural Improvement & Power Dist. AZ CP 3.70% 3/9/2000 15,300 15,300
Salt River Project Agricultural Improvement & Power Dist. AZ Rev. 5.50% 1/1/2000 7,375 7,402
Scottsdale AZ IDA Hosp. Rev. VRDO
(Scottsdale Memorial Health Systems) 3.45% 11/3/1999 (2) 18,680 18,680
----------
148,962
----------
ARKANSAS (0.8%)
Arkansas Dev. Finance Auth. Health Care Fac. VRDO
(Sisters of Mercy) 3.45% 11/4/1999 14,700 14,700
Arkansas Dev. Finance Auth. PUT
(Mortgage-Backed Securities Program) 3.00% 3/1/2000 10,300 10,300
Univ. of Arkansas Board of Trustees Rev. VRDO 3.55% 11/3/1999 (1) 31,400 31,400
----------
56,400
----------
CALIFORNIA (0.5%)
California Community College Financing Auth. TRAN 4.00% 7/28/2000 20,000 20,062
California Student Loan Marketing Corp. 3.45% 11/4/1999 LOC 18,800 18,800
----------
38,862
----------
COLORADO (2.1%)
Colorado Springs CO School Dist. No. 11 El Paso County TAN 4.25% 6/30/2000 36,500 36,629
Colorado Student Obligation Bond Auth. Rev. VRDO 3.50% 11/3/1999 (2) 5,500 5,500
Colorado Student Obligation Bond Auth. Rev. VRDO 3.55% 11/3/1999 (2) 20,000 20,000
Denver CO City & County 6.00% 8/1/2000 (Prere.) 3,925 4,028
Douglas County CO School Dist. No. 1
(Douglas & Elbert Counties) TAN 4.50% 6/30/2000 7,800 7,845
Jefferson County CO School Dist. No. R-001 TAN 4.50% 6/30/2000 45,000 45,223
Regional Transp. Dist. of Colorado COP VRDO
(Transit Vehicles Project) 3.55% 11/4/1999 LOC 27,920 27,920
----------
147,145
----------
DELAWARE (1.0%)
Delaware Econ. Dev. Auth. VRDO (Hosp. Billing & Collection) 3.50% 11/3/1999 (1) 9,200 9,200
Delaware Econ. Dev. Auth. VRDO (Hosp. Billing & Collection) 3.50% 11/3/1999 (1) 59,850 59,850
----------
69,050
----------
FLORIDA (6.9%)
Collier County FL Health Fac. Auth. Hosp. Rev. VRDO
(Cleveland Clinic Obligated Group) 3.65% 11/2/1999 4,400 4,400
Dade County FL Water & Sewer System Rev. VRDO 3.45% 11/3/1999 (3) 1,000 1,000
Florida Board of Educ. Lottery Rev. 4.50% 7/1/2000 (3) 3,670 3,700
Florida Board of Educ. Rev. GO (Capital Outlay) 5.25% 6/1/2000 3,910 3,955
Florida Dept. of General Services Rev.
(Dept. of Environmental Protection Preservation-2000) 4.00% 7/1/2000 (3) 16,590 16,664
Florida Dept. of General Services Rev.
(Dept. of Environmental Protection Preservation-2000) 5.50% 7/1/2000 (2) 14,095 14,252
Florida Dept. of General Services Rev. TOB VRDO
(Dept. of Environmental Protection Preservation-2000) 3.57% 11/4/1999 (4) 17,930 17,930
Florida Hosp. Assn. Loan Program VRDO (Capital Projects Auth.) 3.55% 11/3/1999 (4) 115,400 115,400
Florida Housing Finance Corp. Homeowner Mortgage Rev. 3.15% 3/31/2000 31,925 31,925
Florida Inland Protection Finance Corp. Special Obligation Rev. 5.00% 7/1/2000 (4) 10,000 10,084
Gulf Breeze FL Local Govt. Loan Program VRDO 3.50% 11/4/1999 (3) 29,400 29,400
Hillsborough County FL IDA PCR VRDO (Tampa Electric Co. Project) 3.55% 11/2/1999 2,125 2,125
Jacksonville FL Electric Auth. Electric System 3.70% 3/9/2000 9,000 9,000
Lee County FL Hosp. Board CP (Lee Memorial Hosp. Project) 3.80% 3/13/2000 22,500 22,500
</TABLE>
2
<PAGE> 45
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
FACE MARKET
MATURITY AMOUNT VALUE*
COUPON DATE (000) (000)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Lee County FL Hosp. Board CP (Lee Memorial Hosp. Project) 3.80% 3/27/2000 $ 59,005 $ 59,005
Orange County FL Health Fac. Auth. VRDO
(Adventist Health System/Sunbelt) 3.50% 11/4/1999 LOC 41,000 41,000
Orlando FL Util. Comm. Water & Electric Rev. BAN CP 3.50% 11/18/1999 30,500 30,500
Orlando FL Util. Comm. Water & Electric Rev. BAN CP 3.55% 11/17/1999 20,000 20,000
Orlando FL Util. Comm. Water & Electric Rev. BAN CP 3.70% 3/21/2000 22,600 22,600
St. Lucie County FL PCR VRDO (Florida Power & Light Co.) 3.55% 11/2/1999 4,300 4,300
Sunshine State FL Governmental Financing Commission Rev. CP 3.60% 11/4/1999 (2) 28,225 28,225
Tampa Bay FL Water Utility Systems Rev. TOB VRDO 3.57% 11/4/1999 (3) 2,500 2,500
----------
490,465
----------
GEORGIA (3.9%)
Burke County GA Dev. Auth. PCR VRDO
(Georgia Power Co. Plant Vogtle Project) 3.50% 11/2/1999 9,970 9,970
Burke County GA Dev. Auth. PCR VRDO
(Georgia Power Co. Plant Vogtle Project) 3.60% 11/2/1999 30,100 30,100
Burke County GA Dev. Auth. PCR (Oglethorpe Power Corp.) CP 3.45% 11/16/1999 (2) 32,800 32,800
Burke County GA Dev. Auth. PCR (Oglethorpe Power Corp.) CP 3.55% 11/17/1999 (2) 9,600 9,600
Burke County GA Dev. Auth. PCR VRDO (Oglethorpe Power Corp.) 3.40% 11/3/1999 (3) 2,800 2,800
Burke County GA Dev. Auth. PCR VRDO (Oglethorpe Power Corp.) 3.50% 11/3/1999 (3) 28,395 28,395
Cobb County GA School Dist. TAN 3.50% 12/31/1999 30,000 30,016
Floyd County GA Dev. Auth. Rev. VRDO (Berry College) 3.60% 11/3/1999 LOC 5,000 5,000
Fulco GA Hosp. Auth. RAN Certificates VRDO
(Shepherd Center Project) 3.45% 11/3/1999 LOC 7,300 7,300
Fulco GA Hosp. Auth. VRDO (Piedmont Hosp. Project) 3.60% 11/3/1999 LOC 11,600 11,600
Georgia Environmental Fac. Auth. Water & Wastewater Loan GO 4.50% 7/1/2000 4,825 4,846
Georgia GO 5.75% 8/1/2000 9,210 9,362
Georgia GO TOB VRDO 3.57% 11/4/1999 22,000 22,000
Gwinnett County GA School Dist. Sales Tax Notes 3.50% 12/31/1999 14,400 14,404
Macon-Bibb County GA Hosp. Auth Rev. VRDO
(Medical Center of Central Georgia) 3.60% 11/3/1999 LOC 15,650 15,650
Muni. Electric Auth. of Georgia VRDO 3.40% 11/3/1999 LOC 14,600 14,600
Private Colleges & Univ. Auth. GA PUT (Emory Univ. Project) 3.70% 3/9/2000 9,000 9,000
Richmond County GA Hosp. Auth. VRDO (Univ. of Health Services) 3.60% 11/3/1999 LOC 20,000 20,000
----------
277,443
----------
HAWAII (0.1%)
Hawaii State GO TOB VRDO 3.57% 11/4/1999 7,810 7,810
----------
IDAHO (0.5%)
Idaho TAN 4.25% 6/30/2000 35,000 35,191
----------
ILLINOIS (8.0%)
Bi-State Dev. Agency of the Missouri-Illinois Metro. Dist. VRDO
(St. Clair County Metrolink Extension) 3.45% 11/4/1999 (1) 80,000 80,000
Chicago IL GO TOB VRDO 3.55% 11/4/1999 (3) 7,800 7,800
Chicago IL Park Dist. Tax Anticipation Warrants 4.375% 9/15/2000 20,000 20,127
Chicago IL Public Building Comm. Rev. TOB VRDO
(Chicago School Reform Board) 3.57% 11/4/1999 (3) 7,800 7,800
Chicago IL Rev. VRDO (Midway Airport) 3.70% 11/2/1999 (1) 81,800 81,800
Cook County IL GO TOB VRDO 3.57% 11/4/1999 (3) 4,995 4,995
Illinois Dev. Finance Auth. PCR VRDO (Illinois Power Co. Project) 3.45% 11/3/1999 LOC 32,670 32,670
Illinois Dev. Finance Auth. PCR VRDO (Illinois Power Co. Project) 3.50% 11/3/1999 LOC 13,900 13,900
Illinois Dev. Finance Auth. PCR VRDO (Illinois Power Co. Project) 3.55% 11/3/1999 (1) 27,000 27,000
Illinois Dev. Finance Auth. VRDO (Provena Health) 3.45% 11/3/1999 (1) 51,200 51,200
Illinois Dev. Finance Auth. VRDO (Provena Health) 3.55% 11/2/1999 (1) 17,000 17,000
Illinois Educ. Fac. Auth. Rev. VRDO (DePaul Univ.) 3.45% 11/3/1999 LOC 33,000 33,000
Illinois GO TOB VRDO 3.55% 11/4/1999 (3) 20,000 20,000
Illinois Health Fac. Auth. Rev. VRDO (Pooled Finance) 3.45% 11/3/1999 LOC 10,500 10,500
Illinois Health Fac. Auth. Rev. VRDO (Univ. of Chicago Hosp. Project) 3.40% 11/3/1999 (1) 36,700 36,700
Illinois Health Fac. Auth. Rev. VRDO (Univ. of Chicago Hosp. Project) 3.60% 11/2/1999 (1) 3,150 3,150
Illinois Housing Dev. Auth. PUT (Homeowner Mortgage) 3.90% 10/26/2000 6,500 6,500
Illinois Toll Highway Auth. Rev. VRDO 3.50% 11/3/1999 (1) LOC 85,380 85,380
</TABLE>
3
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<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
FACE MARKET
MATURITY AMOUNT VALUE*
TAX-EXEMPT MONEY MARKET FUND COUPON DATE (000) (000)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Regional Transportation Auth. IL TOB VRDO 3.57% 11/4/1999 (3) $ 12,895 $ 12,895
Schaumburg IL GO VRDO 3.50% 11/3/1999 20,200 20,200
----------
572,617
INDIANA (2.3%) ----------
Delaware County IN Hosp. Auth. Rev. VRDO
(Cardinal Health Systems) 3.45% 11/3/1999 (2) 40,000 40,000
Indiana Educ. Fac. Auth. VRDO (Univ. of Notre Dame du Lac Project) 3.35% 11/4/1999 24,500 24,500
Indiana Health Fac. Financing Auth. Hosp. Rev. VRDO
(Charity Obligated Group - Daughters of Charity) 3.60% 11/3/1999 700 700
Indiana Health Fac. Financing Auth. Hosp. Rev. VRDO
(Clarian Health Partners) 3.50% 11/3/1999 58,500 58,500
Indiana Muni. Power Agency VRDO 3.50% 11/3/1999 LOC 10,000 10,000
Indianapolis Indiana Airport Auth. Subordinate CP 3.75% 3/9/2000 LOC 24,000 24,000
Mount Vernon, Indiana PCR & Solid Waste Disposal CP
(General Electric Co. Project) 3.55% 11/4/1999 4,000 4,000
----------
161,700
----------
IOWA (1.2%)
Iowa Finance Auth. VRDO (Wheaton Franciscan Services Inc.) 3.55% 11/3/1999 (1) 10,000 10,000
Iowa State School Cash Anticipation Program (Iowa School Corp.) 4.00% 6/23/2000 (4) 76,320 76,527
----------
86,527
----------
KANSAS (0.5%)
Sedwick County KS Airport Fac. Rev. VRDO 3.60% 11/4/1999 34,000 34,000
----------
KENTUCKY (4.0%)
Jefferson County KY Board of Educ. RAN 4.25% 6/30/2000 15,645 15,720
Kentucky Asset/Liability Comm. General Fund Notes 4.50% 6/28/2000 58,000 58,249
Kentucky Asset/Liability Comm. Project CP 3.425% 11/16/1999 LOC 10,000 10,000
Kentucky Asset/Liability Comm. Project CP 3.45% 11/29/1999 LOC 10,000 10,000
Kentucky Asset/Liability Comm. Project CP 3.70% 12/10/1999 11,100 11,100
Kentucky Asset/Liability Comm. Project TAN 3.50% 11/1/1999 35,000 35,000
Kentucky Econ. Dev. Finance Auth. Hosp. Fac. Rev. VRDO
(Baptist Healthcare) 3.40% 11/3/1999 (1) 43,500 43,500
Kentucky Econ. Dev. Finance Auth. Hosp. Fac. Rev. VRDO
(Baptist Healthcare) 3.55% 11/2/1999 (1) 8,700 8,700
Kentucky Econ. Dev. Finance Auth. Hosp. Fac. Rev. VRDO
(Health Alliance of Greater Cincinnati) 3.45% 11/3/1999 (1) 29,300 29,300
Louisville & Jefferson County KY Regional Airport Auth. Special
Fac. Rev. VRDO (UPS Worldwide Forwarding) 3.50% 11/2/1999 20,500 20,500
Louisville & Jefferson County KY Regional Airport Auth. Special
Fac. Rev. VRDO (UPS Worldwide Forwarding) 3.55% 11/2/1999 28,800 28,800
Louisville & Jefferson County KY Regional Airport Auth. Special
Fac. Rev. VRDO (UPS Worldwide Forwarding) 3.65% 11/2/1999 12,000 12,000
----------
282,869
----------
LOUISIANA (0.6%)
Louisiana GO 6.00% 8/1/2000 (3) 9,250 9,408
Louisiana Public Fac. Auth. Rev. CP (Christus Health) 3.50% 3/13/2000 (2) 31,000 31,000
----------
40,408
----------
MAINE (0.2%)
Maine Health & Higher Educ. Fac. Auth. VRDO (Bowdoin College) 3.50% 11/3/1999 LOC 13,100 13,100
----------
MARYLAND (1.7%)
Frederick County MD Consolidated Public Improvement VRDO 3.45% 11/3/1999 25,435 25,435
Maryland GO TOB VRDO 3.54% 11/3/1999 46,595 46,595
Maryland GO TOB VRDO 3.57% 11/4/1999 5,000 5,000
Montgomery MD Consolidated BAN CP 3.40% 11/9/1999 27,000 27,000
Washington MD Suburban Sanitation Dist. VRDO 3.45% 11/3/1999 18,700 18,700
----------
122,730
----------
MASSACHUSETTS (2.4%)
Massachusetts GO 5.00% 6/1/2000 (4) 3,500 3,535
Massachusetts GO 5.00% 8/1/2000 9,950 10,042
Massachusetts GO 5.50% 7/1/2000 5,000 5,057
</TABLE>
4
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<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
FACE MARKET
MATURITY AMOUNT VALUE*
COUPON DATE (000) (000)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Massachusetts GO VRDO 3.50% 11/4/1999 $ 22,000 $ 22,000
Massachusetts Water Resources Auth. CP 3.50% 12/13/1999 25,000 25,000
Massachusetts Water Resources Auth. CP 3.50% 12/14/1999 26,500 26,500
Massachusetts Water Resources Auth. CP 3.60% 12/16/1999 32,300 32,300
Plymouth MA BAN 4.25% 10/18/2000 10,000 10,044
Sudbury MA BAN 4.00% 8/11/2000 34,500 34,648
----------
169,126
----------
MICHIGAN (3.1%)
Detroit MI School Dist. State School Aid 4.00% 6/1/2000 20,000 20,091
Michigan Muni. Bond Auth. 4.25% 8/25/2000 32,500 32,667
Michigan Housing Dev. Auth. Rental Rev. VRDO 3.40% 11/3/1999 LOC 28,400 28,400
Michigan Housing Dev. Auth. Rev. 3.00% 12/1/1999 9,000 9,000
Michigan Muni. Bond Auth. 4.25% 8/25/2000 LOC 41,000 41,220
Oakland County MI Econ. Dev. Corp. VRDO
(Cranbrook Educ. Comm.) 3.60% 11/4/1999 6,500 6,500
Regents of Univ. of MI Hosp. Rev. VRDO 3.50% 11/2/1999 18,200 18,200
Univ. of Michigan Hosp. Rev. VRDO 3.50% 11/2/1999 27,745 27,745
Univ. of Michigan Hosp. Rev. VRDO (Medical Service Plan) 3.50% 11/2/1999 37,700 37,700
-----------
221,523
-----------
MINNESOTA (0.8%)
Canby MN Community Hosp. Dist. VRDO
(Sioux Valley Hosp. & Health Systems) 3.60% 11/5/1999 3,740 3,740
Minnesota GO TOB VRDO 3.52% 11/4/1999 51,975 51,975
-----------
55,715
-----------
MISSISSIPPI (1.3%)
Jackson County MS PCR PUT (Chevron USA Inc. Project) 3.85% 5/1/2000 18,305 18,305
Jackson County MS Port Fac. Refunding Bonds PUT
(Chevron USA Inc. Project) 3.85% 5/1/2000 64,000 64,000
Mississippi Capital Improvements GO 5.00% 11/1/2000 + 4,765 4,814
Mississippi GO TOB VRDO 3.57% 11/4/1999 (Prere.) 5,050 5,050
-----------
92,169
-----------
MISSOURI (3.6%)
Missouri Health & Educ. Fac. Auth. CP (Washington Univ.) 3.65% 3/1/2000 33,600 33,600
Missouri Health & Educ. Fac. Auth. VRDO (Washington Univ.) 3.55% 11/2/1999 6,400 6,400
Missouri Health & Educ. Fac. Auth. VRDO
(Sisters of Mercy Health Care System) 3.45% 11/4/1999 100,300 100,300
Missouri Health & Educ. Fac. Auth. VRDO
(St. Anthony's Medical Center) 3.45% 11/3/1999 58,500 58,500
Univ. of Missouri Capital Project 4.25% 6/30/2000 60,000 60,329
-----------
259,129
----------
NEBRASKA (0.2%)
Nebraska Higher Educ. Loan Program VRDO 3.55% 11/3/1999 LOC 17,000 17,000
-----------
NEVADA (0.8%)
Clark County NV Airport Improvement Rev. VRDO
(McCarran International Airport) 3.45% 11/3/1999 LOC 26,740 26,740
Clark County NV Airport Improvement Rev. VRDO
(McCarran International Airport) 3.60% 11/3/1999 (1) 26,200 26,200
Clark County NV Flood Control GO 4.25% 11/1/2000 4,845 4,859
-----------
57,799
-----------
NEW HAMPSHIRE (0.3%)
New Hampshire Higher Educ. & Health Fac. Auth. VRDO
(St. Paul's School) 3.45% 11/3/1999 25,000 25,000
-----------
NEW JERSEY (0.8%)
New Jersey Econ. Dev. Auth. Natural Gas Fac. Rev. VRDO
(New Jersey Natural Gas Project) 3.40% 11/2/1999 (2) 3,400 3,400
New Jersey TRAN CP 3.45% 11/15/1999 25,000 25,000
New Jersey TRAN CP 3.50% 11/15/1999 25,500 25,500
-----------
53,900
-----------
</TABLE>
5
<PAGE> 48
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
FACE MARKET
MATURITY AMOUNT VALUE*
TAX-EXEMPT MONEY MARKET FUND COUPON DATE (000) (000)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
NEW MEXICO (0.4%)
Hurley NM PCR VRDO (Kennecott Sante Fe Corp. Project-
British Petroleum) 3.50% 11/2/1999 $ 2,250 $ 2,250
New Mexico Finance Auth. Administrative Fee Rev. VRDO
(Trims Project) 3.55% 11/3/1999 LOC 11,681 11,681
New Mexico Highway Comm. Rev. VRDO 3.45% 11/3/1999 (4) 18,000 18,000
-----------
31,931
-----------
NEW YORK (8.3%)
Long Island NY Power Auth. Electric System Rev. CP 3.55% 11/17/1999 LOC 10,000 10,000
Long Island NY Power Auth. Electric System Rev. CP 3.55% 11/22/1999 LOC 8,700 8,700
Long Island NY Power Auth. Electric System Rev. CP 3.625% 3/15/2000 LOC 14,200 14,200
Metro. Transp. Auth. of New York (Service Contract) 7.40% 7/1/2000 (Prere.) 4,075 4,264
Muni. Assistance Corp. for New York City NY 5.50% 7/1/2000 15,000 15,182
New York City NY Cultural Resources (Museum of Modern Art) 5.00% 1/1/2000 (2) 7,250 7,271
New York City NY GO VRDO 3.50% 11/2/1999 LOC 11,400 11,400
New York City NY GO VRDO 3.50% 11/2/1999 (1) 10,500 10,500
New York City NY Muni. Water Finance Auth. Water & Sewer
System Rev. TOB VRDO 3.53% 11/4/1999 (3) 20,495 20,495
New York City NY Muni. Water Finance Auth. Water & Sewer
System Rev. VRDO 3.55% 11/2/1999 (3) 50,615 50,615
New York City NY Muni. Water Finance Auth. Water & Sewer
System Rev. VRDO 3.75% 11/2/1999 (3) 18,800 18,800
New York City NY Municipal Water Finance Auth. CP 3.50% 12/23/1999 LOC 12,000 12,000
New York City NY Municipal Water Finance Auth. CP 3.55% 12/23/1999 LOC 25,500 25,500
New York City NY Municipal Water Finance Auth. CP 3.65% 12/23/1999 LOC 28,500 28,500
New York City NY TOB VRDO 3.57% 11/4/1999 (3) 4,000 4,000
New York City NY Transitional Finance Auth. Future Tax Rev. VRDO 3.50% 11/2/1999 25,270 25,270
New York City NY Transitional Finance Auth. Future Tax Rev. VRDO 3.50% 11/3/1999 58,600 58,600
New York Metro. Transp. Auth. TOB VRDO 3.53% 11/4/1999 (3) 5,700 5,700
New York Metro. Transp. Auth. Transit Fac. CP 3.50% 3/13/2000 LOC 21,000 21,000
New York State Dormitory Auth. Rev. (City Univ. System) 7.625% 7/1/2000 (Prere.) 8,130 8,524
New York State Dormitory Auth. Rev. TOB VRDO
(City Univ. of New York) 3.53% 11/4/1999 (1) 19,995 19,995
New York State Dormitory Auth. Rev. (City Univ. System) 7.875% 7/1/2000 (Prere.) 17,165 18,025
New York State Energy Research & Dev. Auth. VRDO
(Consolidated Edison) 3.40% 11/3/1999 18,500 18,500
New York State Energy Research & Dev. Auth. VRDO
(Consolidated Edison) 3.50% 11/3/1999 73,300 73,300
New York State Environmental Fac. Corp. Rev. PCR TOB VRDO 3.53% 11/4/1999 (1) 10,670 10,670
New York State Environmental Fac. Corp. TOB VRDO
(New York City Muni. Water Financial Auth. Project) 3.53% 11/4/1999 (1) 11,180 11,180
New York State Environmental Quality GO PUT 3.00% 12/8/1999 LOC 30,000 30,000
New York State Housing Finance Agency (Service Contract) 7.80% 9/15/2000 (Prere.) 4,760 5,011
New York State Local Govt. Assistance Corp. TOB VRDO 3.53% 11/4/1999 (2) 9,070 9,070
New York State Medical Care Fac. Fin. Agency Rev. TOB VRDO 3.53% 11/4/1999 (3) 5,920 5,920
New York State Power Auth. CP 3.55% 11/15/1999 11,950 11,950
New York State Urban Dev. Corp. Capital Fac. Rev. TOB VRDO 3.53% 11/4/1999 (4) 7,995 7,995
Syosset NY Central School Dist. TAN 4.00% 6/29/2000 13,700 13,748
-----------
595,885
-----------
NORTH CAROLINA (1.8%)
North Carolina Educ. Fac. Finance Auth. VRDO
(Bowman Gray School of Medicine Project) 3.50% 11/3/1999 LOC 11,000 11,000
North Carolina Medical Care Comm. Hosp. Rev. VRDO
(Moses H. Cone Memorial Hosp. Project) 3.50% 11/4/1999 41,500 41,500
North Carolina Medical Care Comm. Hosp. Rev. VRDO
(North Carolina Baptist Hosp. Project) 3.50% 11/4/1999 41,000 41,000
Wake County NC Industrial Fac. & Pollution Control Finance
Auth. VRDO (Carolina Power & Light) 3.45% 11/3/1999 LOC 26,600 26,600
Winston-Salem NC COP VRDO 3.55% 11/4/1999 8,850 8,850
-----------
128,950
-----------
</TABLE>
6
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<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
FACE MARKET
MATURITY AMOUNT VALUE*
COUPON DATE (000) (000)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
OHIO (5.7%)
Cincinnati OH City School Dist. TAN 5.00% 12/1/1999 (2) $ 5,000 $ 5,008
Clermont County OH Hosp. Rev. VRDO (Mercy Health Systems) 3.45% 11/3/1999 84,400 84,400
Cuyahoga County OH Econ. Dev. Rev. VRDO (Cleveland Orchestra) 3.50% 11/2/1999 LOC 3,700 3,700
Cuyahoga County OH Hosp. Rev. VRDO (Cleveland Clinic Foundation) 3.45% 11/3/1999 78,255 78,255
Cuyahoga County OH Hosp. Rev. VRDO (Cleveland Clinic Foundation) 3.45% 11/3/1999 (2) 5,600 5,600
Cuyahoga County OH Hosp. Rev. VRDO (Cleveland Clinic Foundation) 3.45% 11/3/1999 LOC 13,000 13,000
Cuyahoga County OH Hosp. Rev. VRDO (Cleveland Clinic Health
Cuyahoga County OH Hosp. Rev. VRDO (University Health
System Obligated Group) 3.45% 11/3/1999 30,000 30,000
Systems, Inc.) 3.50% 11/4/1999 34,360 34,360
Franklin County OH Hosp. Rev. (Riverside United Methodist) 7.60% 5/15/2000 (Prere.) 7,880 8,216
Franklin County OH Hosp. Rev. VRDO (U.S. Health Corp.) 3.48% 11/4/1999 LOC 9,095 9,095
Hamilton County OH Hosp. Fac. Rev. VRDO (Health Alliance of
Lorain County OH Hosp. Fac. Rev. CP (Catholic Healthcare Partners) 3.60% 12/16/1999 5,000 5,000
Greater Cincinnati) 3.45% 11/3/1999 (1) 23,400 23,400
Lorain County OH Hosp. Fac. Rev. VRDO
(Catholic Healthcare Partners) 3.50% 11/3/1999 22,700 22,700
Montgomery County OH VRDO (Catholic Health Initiatves) 3.45% 11/3/1999 14,300 14,300
Ohio Public Fac. Comm. Higher Educ. Fac. Rev. 4.50% 12/1/1999 20,965 20,991
Ohio Public Fac. Comm. Higher Educ. Fac. Rev. 4.50% 11/1/2000 10,000 10,075
Ohio Public Fac. Comm. Higher Educ. Fac. Rev. 5.00% 11/1/1999 6,370 6,370
Ohio Public Fac. Comm. Higher Educ. Fac. Rev. 5.50% 12/1/1999 7,685 7,700
Ohio State Univ. CP 3.50% 11/9/1999 10,800 10,800
Ohio State Univ. CP 3.65% 11/29/1999 7,500 7,500
Ohio Water Dev. Auth. Rev. (Pure Water) 5.40% 6/1/2000 (1) 3,260 3,300
-----------
403,770
-----------
OKLAHOMA (0.7%)
Garfield County OK IDA PCR VRDO (Oklahoma Gas & Electric
Co. Project) 3.57% 11/3/1999 40,300 40,300
Oklahoma Student Loan Auth. VRDO 3.55% 11/3/1999 (1) 8,000 8,000
-----------
48,300
-----------
OREGON (1.2%)
Oregon Health Housing Educ. & Cultural Fac. Auth. VRDO
(Peacehealth) 3.50% 11/4/1999 LOC 14,585 14,585
Oregon Veterans Welfare Program VRDO 3.40% 11/3/1999 65,700 65,700
Port of Portland OR Portland International Airport Passenger
Fac. Rev. TOB VRDO 3.62% 11/4/1999 (2) 5,130 5,130
-----------
85,415
-----------
PENNSYLVANIA (2.2%)
Allegheny County PA IDA PCR PUT (Dusquesne Light Co.) 3.60% 11/18/1999 LOC 10,000 10,000
Delaware County PA IDA Airport Fac. Rev. VRDO
(United Parcel Service) 3.60% 11/2/1999 2,000 2,000
Delaware County PA IDA PCR CP (PECO) 3.70% 3/14/2000 LOC 16,600 16,600
Geisinger Health System Auth. of Pennsylvania VRDO
(Penn State Geisinger Health System) 3.60% 11/2/1999 24,175 24,175
Montgomery County PA IDA PCR CP (PECO) 3.60% 11/17/1999 LOC 9,400 9,400
Pennsylvania Higher Educ. Assistance Agency Student Loan
Rev. VRDO 3.55% 11/3/1999 (2) 23,200 23,200
Pennsylvania Higher Educ. Fac. Auth. Rev. VRDO
(Carnegie Mellon Univ.) 3.60% 11/2/1999 9,500 9,500
Philadelphia PA Hosp. & Higher Educ. Fac. Auth. Rev. VRDO
(Children's Hosp. Project) 3.60% 11/2/1999 2,800 2,800
Philadelphia PA IDA VRDO (Fox Chase Institute for Cancer Research) 3.60% 11/2/1999 LOC 3,900 3,900
Sayre PA Health Care Fac. Auth. VRDO (VHA of Pennsylvania,
Pooled Capital Asset Financial Program) 3.50% 11/3/1999 (2) 56,000 56,000
-----------
157,575
-----------
PUERTO RICO (0.1%)
Puerto Rico Govt. Dev. Bank CP 3.55% 11/15/1999 6,736 6,736
-----------
</TABLE>
7
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<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
FACE MARKET
MATURITY AMOUNT VALUE*
TAX-EXEMPT MONEY MARKET FUND COUPON DATE (000) (000)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
RHODE ISLAND (0.2%)
Rhode Island Capital Dev. Loan VRDO 3.40% 11/3/1999 $ 14,390 $ 14,390
-----------
SOUTH CAROLINA (1.3%)
Lexington SC School Dist. No. 1 BAN 4.50% 9/29/2000 23,930 24,092
South Carolina Public Service Auth. (Santee Cooper) CP 3.55% 11/16/1999 40,000 40,000
South Carolina Public Service Auth. (Santee Cooper) CP 3.60% 11/18/1999 30,000 30,000
-----------
94,092
-----------
SOUTH DAKOTA (0.3%)
South Dakota Health & Educ. Fac. Auth. VRDO
(Sioux Valley Hosp. & Health System) 3.60% 11/5/1999 18,480 18,480
-----------
TENNESSEE (2.1%)
Metro. Govt. of Nashville & Davidson County TN
Health & Educ. Fac. PUT (Vanderbilt Univ.) 3.10% 1/15/2000 9,000 9,000
Metro. Govt. of Nashville & Davidson County TN
Industrial Dev. Board VRDO (Country Music Hall of Fame) 3.45% 11/4/1999 LOC 14,500 14,500
Metro. Govt. of Nashville TN Airport Auth. Improvement
Refunding VRDO 3.45% 11/3/1999 (3) LOC 36,600 36,600
Shelby County TN TAN 4.25% 6/30/2000 39,200 39,334
Tennessee BAN VRDO 3.50% 11/3/1999 20,000 20,000
Tennessee GO TOB VRDO 3.52% 11/4/1999 30,750 30,750
-----------
150,184
-----------
TEXAS (11.1%)
Austin City TX CP (Travis & Williamson Counties
Combined Utility Systems) 3.45% 11/10/1999 LOC 10,825 10,825
Coastal Bend TX Health Fac. Dev. Corp. Rev. VRDO
(Incarnate Word Health System) 3.55% 11/3/1999 (2) 34,700 34,700
Gulf Coast TX IDA Environmental Fac. Rev. VRDO
(Citgo Petroleum Corp. Project) 3.65% 11/2/1999 LOC 6,100 6,100
Gulf Coast TX Waste Disposal Auth. PCR VRDO (Exxon Project) 3.50% 11/2/1999 4,460 4,460
Harris County TX Health Fac. Dev. Corp. Rev. (Christus Health) 5.00% 7/1/2000 10,580 10,664
Harris County TX Health Fac. Dev. Corp. Hosp. ) VRDO
(Methodist Hosp. of Houston) 3.60% 11/2/1999 116,400 116,400
Harris County TX Health Fac. Dev. Corp. Hosp. Rev. VRDO
(St. Lukes Episcopal Hosp.) 3.65% 11/2/1999 60,280 60,280
Harris County TX Health Fac. Dev. Corp. Hosp. Rev. VRDO
(Young Men's Christian Assoc. of the Greater Houston Area) 3.60% 11/2/1999 LOC 29,800 29,800
Harris County TX Toll Road VRDO 3.40% 11/3/1999 24,000 24,000
Harris County TX Toll Road VRDO 3.55% 11/3/1999 19,800 19,800
Houston City TX 3.55% 11/23/1999 10,000 10,000
Houston City TX 3.60% 11/17/1999 19,700 19,700
Houston TX Higher Educ. Finance Corp. Rev. TOB VRDO
(Rice Univ.) 3.60% 11/4/1999 7,500 7,500
Katy TX Independent School Dist. VRDO 3.45% 11/4/1999 23,500 23,500
Midland TX Independent School Dist. VRDO 3.45% 11/4/1999 5,100 5,100
North Central TX Health Fac. Dev. Corp. VRDO
(Presbyterian Medical Center) 3.65% 11/2/1999 (1) 7,800 7,800
North Central TX Health Fac. CP (Methodist Hosp. of Dallas) 3.60% 11/10/1999 (2) 22,200 22,200
North Harris TX Montgomery Community College Dist. VRDO 3.45% 11/4/1999 (3) 15,750 15,750
Pasadena TX Independent School Dist. VRDO 3.45% 11/4/1999 18,600 18,600
Red River TX Auth. PCR VRDO (Southwest Public Service) 3.45% 11/4/1999 (2) 20,000 20,000
Richardson TX Independent School Dist. VRDO 3.45% 11/4/1999 4,800 4,800
Southwest Texas Higher Educ. Auth. Inc. VRDO
(Southern Methodist Univ. Project) 3.45% 11/3/1999 LOC 24,000 24,000
Tarrant County TX Junior College Dist. Rev. 3.65% 2/15/2000 2,865 2,870
Texas A&M Univ. System Board of Regents 3.55% 11/29/1999 7,200 7,200
Texas Dept. Housing & Community Affairs Residential
Mortgage Rev. PUT 3.90% 5/1/2000 + 30,000 30,000
Texas TRAN 4.50% 8/31/2000 255,000 256,618
-----------
792,667
-----------
</TABLE>
8
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<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
FACE MARKET
MATURITY AMOUNT VALUE*
COUPON DATE (000) (000)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
UTAH (5.0%)
Central Utah Water Conservancy Dist. VRDO 3.55% 11/3/1999 (2) $ 13,810 $ 13,810
Emery County UT PCR VRDO (PacifiCorp Project) 3.45% 11/3/1999 LOC 35,500 35,500
Intermountain Power Agency Utah Power Supply Rev. 5.50% 7/1/2000 (1) 6,685 6,772
Intermountain Power Agency Utah Power Supply Rev. 10.375% 7/1/2000 (Prere.) 33,470 35,339
Intermountain Power Agency Utah Power Supply Rev. CP 3.70% 3/21/2000 (2) 8,400 8,400
Intermountain Power Agency Utah Power Supply Rev. TOB VRDO 3.57% 11/4/1999 (1) 6,495 6,495
Intermountain Power Agency Utah TOB VRDO 3.48% 11/3/1999 (1) 37,600 37,600
Salt Lake City UT TRAN 3.50% 6/30/2000 16,000 16,028
Salt Lake County UT TRAN 4.00% 12/29/1999 5,000 5,004
Utah GO TOB VRDO 3.54% 11/4/1999 43,860 43,860
Utah GO VRDO 3.35% 11/3/1999 67,325 67,325
Utah GO VRDO 3.40% 11/4/1999 28,500 28,500
Utah Transit Auth. Sales Tax & Transp. Rev. VRDO (Salt Lake County
Light Rail Transit 'TRAX' Program) 3.40% 11/4/1999 LOC 50,800 50,800
-----------
355,433
-----------
VIRGINIA (1.0%)
Arlington County VA TOB VRDO 3.55% 11/4/1999 33,470 33,470
Fairfax County VA GO 7.25% 6/1/2000 5,805 5,936
Fairfax County VA IDA Rev. VRDO (Fairfax Hosp. System) 3.45% 11/3/1999 17,750 17,750
Fairfax County VA Public Improvement GO 5.50% 6/1/2000 3,375 3,419
Norfolk VA 4.50% 6/1/2000 6,525 6,556
Virginia State Public School Auth. School Financing Rev. 4.25% 8/1/2000 7,005 7,031
-----------
74,162
-----------
WASHINGTON (2.8%)
Port of Seattle Washington CP 3.70% 3/14/2000 LOC 50,000 50,000
Port of Seattle Washington CP 3.75% 3/14/2000 LOC 76,000 76,000
Seattle WA Muni. Light & Power Rev. VRDO 3.50% 11/3/1999 30,500 30,500
Seattle WA Muni. Metro. Seattle Sewer Rev. 6.875% 1/1/2000 (Prere.) 3,625 3,718
Seattle WA Water System Rev. VRDO 3.50% 11/3/1999 LOC 19,800 19,800
Snohomish County WA Public Util. Dist. Generation System Rev.
TOB VRDO 3.62% 11/4/1999 (1) 4,995 4,995
Washington GO 5.75% 7/1/2000 5,820 5,915
Washington GO 6.50% 7/1/2000 9,695 9,901
-----------
200,829
-----------
WEST VIRGINIA (0.5%)
Putnam County WV Solid Waste Disposal Rev. VRDO
(Toyota Manufacturing Corp.) 3.50% 11/3/1999 38,200 38,200
-----------
WISCONSIN (3.4%)
Milwaukee WI IDR VRDO (Wisconsin Electric Power Co. Project) 3.50% 11/4/1999 10,000 10,000
Oak Creek City WI VRDO (Wisconsin Electric Power Co. Project) 3.45% 11/3/1999 47,100 47,100
Univ. of Wisconsin Hosp. & Clinics Auth. Rev. VRDO
(Univ. of Wisconsin Hosp.) 3.45% 11/3/1999 (1) 21,500 21,500
Village of Pleasant Prairie WI PCR VRDO (Wisconsin Electric Power
Co. Project) 3.50% 11/4/1999 28,500 28,500
Wisconsin GO 4.25% 11/1/1999 4,000 4,000
Wisconsin Health & Educ. Fac. Auth. Rev. VRDO
(Charity Obligated Group-Daughters of Charity National
Health System) 3.60% 11/3/1999 300 300
Wisconsin Health & Educ. Fac. Auth. Rev. VRDO (Wausau Hosp.) 3.45% 11/3/1999 (2) 20,000 20,000
Wisconsin Health & Educ. Fac. Auth. Rev. VRDO
(Wheaton Franciscan Services) 3.55% 11/4/1999 LOC 48,300 48,300
Wisconsin Dept. of Transp. Rev. CP 3.40% 11/9/1999 LOC 5,022 5,022
Wisconsin Dept. of Transp. Rev. CP 3.45% 11/29/1999 LOC 27,423 27,423
Wisconsin Dept. of Transp. Rev. CP 3.50% 11/18/1999 LOC 27,159 27,159
Wisconsin Dept. of Transp. Rev. CP 3.50% 12/13/1999 LOC 5,547 5,547
-----------
244,851
-----------
</TABLE>
9
<PAGE> 52
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
FACE MARKET
MATURITY AMOUNT VALUE*
TAX-EXEMPT MONEY MARKET FUND COUPON DATE (000) (000)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
WYOMING (0.7%)
Uinta County WY PCR PUT (Chevron USA Inc. Project) 3.85% 5/1/2000 $ 54,100 $ 54,100
--------
- ---------------------------------------------------------------------------------------------------------------------------
TOTAL MUNICIPAL BONDS
(COST $7,319,966) 7,319,966
- ---------------------------------------------------------------------------------------------------------------------------
OTHER ASSETS AND LIABILITIES (-2.5%)
- ---------------------------------------------------------------------------------------------------------------------------
Other Assets--Note B 111,164
Payables for Investment Securities Purchased (261,939)
Other Liabilities (24,780)
-----------
(175,555)
- ---------------------------------------------------------------------------------------------------------------------------
NET ASSETS (100%)
- ---------------------------------------------------------------------------------------------------------------------------
Applicable to 7,145,128,219 outstanding $.001 par value shares
of beneficial interest (unlimited authorization) $7,144,411
===========================================================================================================================
NET ASSET VALUE PER SHARE $1.00
===========================================================================================================================
</TABLE>
*See Note A in Notes to Financial Statements.
For key to abbreviations and other references, see page 67.
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
AT OCTOBER 31, 1999, NET ASSETS CONSISTED OF:
- ---------------------------------------------------------------------------------------------------------------------------
AMOUNT PER
(000) SHARE
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Paid in Capital $7,145,146 $1.00
Undistributed Net Investment Income -- --
Accumulated Net Realized Losses--Note E (735) --
Unrealized Appreciation -- --
- ---------------------------------------------------------------------------------------------------------------------------
NET ASSETS $7,144,411 $1.00
===========================================================================================================================
</TABLE>
10
<PAGE> 53
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
FACE MARKET
MATURITY AMOUNT VALUE*
SHORT-TERM TAX-EXEMPT FUND COUPON DATE (000) (000)
- ---------------------------------------------------------------------------------------------------------------------------
MUNICIPAL BONDS (100.6%)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
ALABAMA (1.8%)
Alabama GO 5.50% 10/1/2003 $10,000 $ 10,332
Birmingham AL GO VRDO 3.50% 11/3/1999 (2)LOC 4,400 4,400
Montgomery City AL Industrial Dev. Board Pollution Control &
Solid Waste Disposal Rev. CP (General Electric Co.) 3.55% 11/4/1999 19,600 19,600
-----------
34,332
-----------
ALASKA (1.0%)
North Slope Borough AK GO 0.00% 1/1/2002 (1) 7,650 6,913
Valdez AK Marine Terminal Rev. VRDO (Exxon Pipeline Co. Project) 3.50% 11/2/1999 13,100 13,100
-----------
20,013
-----------
ARIZONA (0.9%)
Arizona Transp. Board Highway Rev. 5.00% 7/1/2001 + 12,010 12,155
Arizona Transp. Board Highway Rev. 6.00% 7/1/2000 4,500 4,564
Maricopa County AZ PCR VRDO (Arizona Public Service Palo Verde) 3.50% 11/2/1999 LOC 500 500
-----------
17,219
-----------
CALIFORNIA (2.9%)
California Dept. of Water (Central Valley Project) Rev. 8.75% 12/1/2000 4,540 4,784
California Statewide Community Dev. Auth. Rev. TRAN
(Riverside County) 4.00% 9/29/2000 18,250 18,313
Santa Barbara County CA TRAN 4.25% 9/29/2000 19,800 19,958
Santa Clara CA United School Dist. TRAN 4.25% 9/29/2000 11,000 11,062
-----------
54,117
-----------
COLORADO (0.8%)
Jefferson County CO School Dist. GO 5.00% 12/15/2002 (3) 4,500 4,577
Jefferson County CO School Dist. GO 5.00% 12/15/2001 (3) 5,800 5,893
Platte River CO Power Auth. Rev. 5.00% 6/1/2000 (1) 5,000 5,034
-----------
15,504
-----------
CONNECTICUT (0.9%)
Connecticut Special Assessment Unemployment Compensation 5.50% 5/15/2000 (2) 17,500 17,657
-----------
DISTRICT OF COLUMBIA (2.6%)
District of Columbia GO 0.00% 6/1/2000 (1)(ETM) 6,900 6,738
District of Columbia GO 5.50% 6/1/2001 20,000 20,262
District of Columbia GO 5.90% 6/1/2000 (1) 9,860 9,975
District of Columbia GO 5.90% 6/1/2000 (1)(ETM) 245 248
District of Columbia GO 6.00% 6/1/2001 (1) 7,920 8,133
District of Columbia GO 6.00% 6/1/2001 (1)(ETM) 195 200
District of Columbia GO 7.10% 6/1/2000 (4) 3,535 3,598
District of Columbia GO 7.10% 6/1/2000 (4)(ETM) 85 86
-----------
49,240
-----------
FLORIDA (4.5%)
Collier County FL Health Fac. Auth. Hosp. Rev. VRDO
(Cleveland Clinic Obligated Group) 3.65% 11/2/1999 600 600
Dade County FL Sales Tax Rev. 6.00% 10/1/2001 (2) 2,500 2,583
Dade County FL Water & Sewer System Rev. VRDO 3.45% 11/3/1999 (3) 1,100 1,100
Florida Board of Educ. Rev. (Capital Outlay) 5.00% 6/1/2002 10,535 10,693
Florida Muni. Power Agency VRDO (Stanton Project) 3.40% 11/3/1999 (1) 9,690 9,690
Florida State Board of Educ. Public Educ. Capital Outlay Refunding 5.00% 6/1/2000 15,455 15,558
Florida State Board of Higher Educ. 5.40% 5/1/2001 (ETM) 3,600 3,664
Jacksonville FL Electric Auth. Rev. (St. John River) 5.00% 10/1/2002 11,910 12,110
Miami-Dade County FL School Board COP 4.25% 8/1/2000 (4) 3,000 3,008
Miami-Dade County FL School Board COP 5.00% 8/1/2001 (4) 3,850 3,901
Miami-Dade County FL School Board COP 5.00% 8/1/2002 (4) 5,795 5,884
Osceola County FL Capital Improvement Rev. 4.50% 9/1/2000 (1) 5,000 5,026
Tampa FL Health System Rev. (Catholic Health East) 4.50% 11/15/1999 (1) 5,355 5,356
Tampa FL Health System Rev. (Catholic Health East) 5.00% 11/15/2001 (1) 4,035 4,093
Tampa FL Rev. (Allegany Health System-St. Joseph) 7.125% 12/1/1999 (Prere.) 2,500 2,557
-----------
85,823
-----------
</TABLE>
11
<PAGE> 54
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
FACE MARKET
MATURITY AMOUNT VALUE*
SHORT-TERM TAX-EXEMPT FUND COUPON DATE (000) (000)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
GEORGIA (2.9%)
Burke County GA Dev. Auth. PCR VRDO (Georgia Power Co. ) 3.60% 11/2/1999 $ 6,600 $ 6,600
Burke County GA Dev. Auth. PCR VRDO (Oglethorpe Power Corp.) 3.50% 11/3/1999 (3) 17,390 17,390
Georgia GO 5.00% 8/1/2001 5,070 5,142
Georgia GO 6.80% 8/1/2000 2,230 2,279
Georgia GO 7.00% 11/1/1999 7,500 7,501
Georgia GO 7.40% 8/1/2000 5,000 5,131
Georgia GO 7.50% 4/1/2001 5,500 5,749
Georgia GO 7.70% 2/1/2001 5,000 5,214
-----------
55,006
-----------
HAWAII (2.6%)
Hawaii GO 5.00% 11/1/1999 20,000 20,001
Hawaii GO 5.25% 4/1/2003 (1) 5,000 5,105
Hawaii GO 6.00% 9/1/2001 3,000 3,085
Hawaii GO 8.00% 2/1/2001 5,000 5,215
Hawaii Highway Rev. 5.00% 7/1/2002 (3) 3,530 3,577
Honolulu HI City & County GO 4.70% 10/1/2000 4,375 4,404
Honolulu HI City & County GO 4.70% 10/1/2000 (ETM) 125 126
Honolulu HI City & County GO 5.00% 7/1/2002 (3) 4,675 4,738
Honolulu HI City & County GO 5.25% 11/1/2003 (3)(ETM) 2,550 2,619
Honolulu HI City & County GO 5.25% 11/1/2003 (3) 5 5
-----------
48,875
-----------
ILLINOIS (1.4%)
Chicago IL Metro. Water Reclamation Dist. GO 6.40% 1/1/2000 5,000 5,021
Illinois Dev. Finance Auth. VRDO (Provena Health) 3.45% 11/3/1999 (1) 3,300 3,300
Illinois Educ. Fac. Auth. (Northwestern Univ.) 4.75% 12/1/2000 10,000 10,093
Illinois Toll Highway Auth. Rev. VRDO PUT 3.50% 11/3/1999 (1) LOC 8,200 8,200
-----------
26,614
-----------
INDIANA (0.4%)
Indianapolis IN Airport Auth. Rev. 4.50% 7/1/2000 (3) 3,500 3,511
Merrillville IN Multiple School Building Corp. Rev. 7.50% 7/15/2000 (Prere.) 4,000 4,178
-----------
7,689
-----------
KANSAS (0.4%)
Merriam KS Hosp. Rev. (Shawnee Medical Center Project) 7.25% 9/1/2001 (Prere.) 3,580 3,827
Wyandotte County, Kansas City KS Unified Govt. GO 5.00% 9/1/2001 (2) 4,150 4,207
-----------
8,034
-----------
KENTUCKY (0.5%)
Kentucky Econ. Dev. Finance Auth. Hosp. Fac. Rev. VRDO
(Baptist Healthcare) 3.40% 11/3/1999 (1) 9,250 9,250
-----------
LOUISIANA (2.3%)
Jefferson Parish LA Hosp. Dist. VRDO
(West Jefferson Medical Center) 3.45% 11/3/1999 LOC 11,820 11,820
Louisiana Gasoline and Fuels Tax Rev. 4.50% 11/15/2000 28,735 28,855
Louisiana GO 5.00% 4/15/2002 (2) 3,400 3,442
-----------
44,117
-----------
MARYLAND (1.8%)
Maryland Health & Higher Educ. Fac. (Francis Scott Key) 7.00% 7/1/2000 (Prere.) 4,000 4,161
Maryland Health & Higher Educ. Fac. VRDO (Johns Hopkins Hosp.) 3.45% 11/3/1999 LOC 30,000 30,000
-----------
34,161
-----------
MASSACHUSETTS (6.8%)
Massachusetts Bay Transp. Auth. 7.00% 3/1/2001 (Prere.) 6,000 6,330
Massachusetts Bay Transp. Auth. 7.625% 3/1/2000 (Prere.) 5,550 5,729
Massachusetts GO 6.25% 7/1/2002 11,000 11,501
Massachusetts GO 6.50% 8/1/2001 (Prere.) 3,115 3,293
Massachusetts GO 7.25% 3/1/2000 (3)(Prere.) 3,910 4,032
Massachusetts GO 7.625% 6/1/2001 (Prere.) 10,000 10,706
Massachusetts GO 9.25% 7/1/2000 10,000 10,351
Massachusetts Health & Educ. Fac. Auth. Rev.
(Caritas Christi Obligated Group) 5.25% 7/1/2000 2,580 2,586
</TABLE>
12
<PAGE> 55
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
FACE MARKET
MATURITY AMOUNT VALUE*
COUPON DATE (000) (000)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Massachusetts Health & Educ. Fac. Auth. Rev.
(Caritas Christi Obligated Group) 5.25% 7/1/2002 $ 5,040 $ 5,029
Massachusetts Health & Educ. Fac. Auth. Rev. PUT
(Fairview Extended Care) 4.55% 7/14/2002 (1) 3,350 3,329
Massachusetts Housing Finance Agency (Construction Loan Notes) 4.10% 3/1/2002 (4) 11,500 11,348
Massachusetts Water Resources Auth. Rev. 6.50% 12/1/2001 (Prere.) 4,300 4,575
Massachusetts Water Resources Auth. Rev. 7.00% 4/1/2000 (Prere.) 10,485 10,829
Massachusetts Water Resources Auth. Rev. 7.30% 4/1/2000 (Prere.) 5,000 5,170
Massachusetts Water Resources Auth. Rev. 7.50% 4/1/2000 (Prere.) 15,850 16,402
Massachusetts Water Resources Auth. Rev. 7.625% 4/1/2000 (Prere.) 17,645 18,269
-----------
129,479
-----------
MICHIGAN (3.6%)
Greater Detroit MI Resource Recovery Auth. 5.00% 12/13/1999 (2) 12,000 12,017
Michigan Building Auth. Rev. (Fac. Program) 5.00% 10/1/2000 (2) 4,000 4,041
Michigan Hosp. Finance Auth. Rev. (McLaren Obligated Group) 7.50% 9/15/2001 (Prere.) 5,750 6,192
Michigan Housing Dev. Auth. Rental Rev. VRDO 3.40% 11/3/1999 LOC 10,700 10,700
Michigan Muni. Bond Bank Auth. Rev. 5.00% 12/1/2002 11,905 12,093
Michigan Strategic Fund Limited Obligation Rev. PUT (Detroit Edison) 4.73% 9/1/2001 15,065 15,035
Univ. of Michigan Hosp. Rev. VRDO (Medical Service Plan) 3.50% 11/2/1999 8,500 8,500
-----------
68,578
-----------
MINNESOTA (1.8%)
Minneapolis MN GO 5.00% 12/1/2001 16,210 16,473
Minnesota GO 4.625% 8/1/2000 10,385 10,449
Minnesota GO 6.40% 8/1/2000 6,700 6,828
-----------
33,750
-----------
MISSISSIPPI (1.2%)
Jackson County MS Port Fac. Refunding Bonds VRDO
(Chevron USA Inc. Project) 3.70% 11/3/1999 17,000 17,000
Mississippi GO 5.00% 8/1/2001 2,495 2,527
Mississippi GO (Capital Improvements) 5.00% 11/1/2001 3,555 3,607
-----------
23,134
-----------
MISSOURI (0.7%)
Missouri Health & Educ. Fac. Auth. VRDO
(Sisters of Mercy Health Care System) 3.45% 11/4/1999 4,600 4,600
St. Louis County MO Rockwood School Dist. GO 8.50% 2/1/2001 8,000 8,415
-----------
13,015
-----------
MONTANA (0.5%)
Forsyth MT PCR PUT (Portland General Electric Co.) 4.60% 5/1/2003 10,000 9,920
-----------
NEBRASKA (1.2%)
Nebraska Public Power Dist. Rev. 5.00% 1/1/2001 8,500 8,555
Nebraska Public Power Dist. Rev. 5.00% 1/1/2002 (1) 5,000 5,058
Nebraska Public Power Dist. Rev. 5.00% 1/1/2003 (1) 5,000 5,063
Omaha NE Public Power Dist. Electric Rev. 5.00% 2/1/2001 4,250 4,291
-----------
22,967
-----------
NEVADA (2.5%)
Clark County NV Airport Improvement Rev. VRDO
(McCarran International Airport) 3.45% 11/3/1999 LOC 7,245 7,245
Clark County NV Airport Improvement Rev. VRDO
(McCarran International Airport) 3.45% 11/3/1999 (1) 17,630 17,630
Clark County NV GO 5.25% 11/1/2002 6,255 6,392
Clark County NV Improvement and Refunding Rev. 6.00% 10/1/2001 4,845 4,999
Clark County NV School Dist. GO (Computer Equipment) 7.50% 6/15/2000 (3) 6,000 6,133
Nevada GO 4.50% 7/1/2001 5,085 5,104
-----------
47,503
-----------
NEW JERSEY (1.7%)
New Jersey Econ. Dev. Auth. Market Transition Fac. Rev. 5.125% 7/1/2000 (1) 2,710 2,732
(NJ Natural Gas Project) 3.65% 11/2/1999 (2) 3,000 3,000
New Jersey Health Care Fac. Finance Auth. Rev.
(Community Medical Center, Kimball Medical Center,
Kensington Manor Care Center Obligated Group) 4.50% 7/1/2001 (4) 4,835 4,852
</TABLE>
13
<PAGE> 56
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
FACE MARKET
MATURITY AMOUNT VALUE*
SHORT-TERM TAX-EXEMPT FUND COUPON DATE (000) (000)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
New Jersey Transit Corp. Rev. 5.25% 9/1/2001 $ 5,000 $ 5,069
New Jersey Turnpike Auth. Rev. VRDO 3.40% 11/3/1999 (3) LOC 5,900 5,900
Port Auth. of New York & New Jersey 4.75% 9/15/2001 (3) 9,655 9,729
-----------
31,282
-----------
NEW MEXICO (0.6%)
New Mexico GO 5.50% 9/1/2000 6,350 6,436
New Mexico GO 5.50% 9/1/2001 4,475 4,578
-----------
11,014
-----------
NEW YORK (14.2%)
Erie County NY GO 5.00% 11/1/2002 (3) 2,000 2,028
Long Island NY Power Auth. Electric System Rev. 5.00% 4/1/2002 8,000 8,074
Long Island NY Power Auth. Electric System Rev. 5.00% 4/1/2003 8,500 8,571
Muni. Assistance Corp. for New York City NY 5.00% 7/1/2001 10,000 10,124
Muni. Assistance Corp. for New York City NY 5.25% 7/1/2001 5,110 5,194
Nassau County NY General Improvement 4.90% 3/1/2001 (3) 11,060 11,147
Nassau County NY General Improvement 5.125% 11/1/1999 (3) 7,525 7,526
New York City NY GO 7.25% 8/15/2001 (Prere.) 22,745 23,934
New York City NY GO 7.50% 2/1/2002 (Prere.) 7,860 8,454
New York City NY GO 7.625% 2/1/2002 (Prere.) 8,190 8,867
New York City NY Muni. Water Finance Auth. Water &
Sewer System Rev. VRDO 3.55% 11/2/1999 (3) 1,950 1,950
New York City NY Muni. Water Finance Auth. Water &
Sewer System Rev. VRDO 3.75% 11/2/1999 (3) 1,700 1,700
New York State COP 4.10% 8/1/2000 5,600 5,606
New York State COP 5.00% 3/1/2002 16,230 16,361
New York State Dormitory Auth. Rev. (Brookdale Hosp.) 5.00% 2/15/2001 4,335 4,368
New York State Dormitory Auth. Rev. (City Univ.) 7.625% 7/1/2000 (Prere.) 23,600 24,644
New York State Dormitory Auth. Rev. (Interfaith Medical Center) 5.25% 2/15/2002 2,565 2,599
New York State Dormitory Auth. Rev. (Jamaica Hosp.) 5.00% 2/15/2001 2,725 2,745
New York State Dormitory Auth. Rev. (State Univ.) 7.25% 5/15/2000 (Prere.) 2,070 2,148
New York State Dormitory Auth. Rev. (State Univ.) 7.70% 5/15/2000 (Prere.) 4,000 4,161
New York State Dormitory Auth. Rev. (Wycoff Heights) 5.00% 2/15/2001 2,605 2,624
New York State Energy Research & Dev. Auth. VRDO
(Consolidated Edison) 3.40% 11/3/1999 20,200 20,200
New York State Environmental Fac. (Riverbank State Park) 7.375% 4/1/2002 (Prere.) 5,000 5,429
New York State Hosp. Finance Agency (Service Contract) 7.80% 3/15/2001 (Prere.) 15,000 15,978
New York State Local Govt. Assistance Corp. 7.00% 4/1/2001 (Prere.) 7,675 8,114
New York State Local Govt. Assistance Corp. 7.50% 4/1/2001 (Prere.) 10,000 10,639
New York State Medical Care Fac. Finance Agency Rev. (St. Luke's) 7.45% 2/15/2000 (1)(Prere.) 5,000 5,151
New York State Power Auth Rev. & General Purpose 6.75% 1/1/2001 (Prere.) 7,900 8,283
New York State Urban Dev. Corp. Rev.
(Community Enhancement Fac.) 4.25% 4/1/2000 9,495 9,508
New York State Urban Dev. Corp. Rev.
(Community Enhancement Fac.) 4.50% 4/1/2001 11,645 11,657
New York State Urban Dev. Corp. Rev.
(Community Enhancement Fac.) 4.50% 4/1/2002 3,000 2,990
New York State Urban Dev. Corp. Rev.
(Correction Fac.) 7.75% 1/1/2000 (Prere.) 3,900 4,003
New York State Urban Dev. Corp. Rev.
(Correctional Fac. Service Contract) 5.00% 1/1/2002 4,350 4,389
-----------
269,166
-----------
NORTH CAROLINA (0.2%)
North Carolina Medical Care Comm. Hosp. Rev. VRDO
(North Carolina Baptist Hosp. Project) 3.50% 11/4/1999 3,000 3,000
-----------
OHIO (2.5%)
Cincinnati OH School Dist. TAN 5.50% 12/1/2000 (2) 4,300 4,374
Clermont County OH Hosp. Rev. VRDO (Mercy Health Systems) 3.45% 11/3/1999 11,300 11,300
Columbus OH GO 5.00% 5/15/2002 3,000 3,045
Cuyahoga County OH Hosp. Rev. (Meridia Health System) 7.25% 8/15/2000 (Prere.) 4,980 5,207
Franklin County OH Hosp. Rev. VRDO (U.S. Health Corp.) 3.48% 11/4/1999 LOC 3,950 3,950
</TABLE>
14
<PAGE> 57
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
FACE MARKET
MATURITY AMOUNT VALUE*
COUPON DATE (000) (000)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Lorain County OH Hosp. Fac. Rev. VRDO
(Catholic Healthcare Partners) 3.50% 11/3/1999 $ 6,000 $ 6,000
Ohio Building Auth. Rev. (State Correctional Fac.) 6.50% 10/1/2001 5,100 5,309
Ohio Housing Finance Agency Mortgage Rev. 3.60% 9/1/2001 2,595 2,547
Ohio Housing Finance Agency Mortgage Rev. 3.80% 9/1/2002 2,790 2,716
Ohio Housing Finance Agency Mortgage Rev. 3.95% 9/1/2003 2,595 2,507
-----------
46,955
-----------
OKLAHOMA (1.2%)
Garfield County OK IDA PCR VRDO
(Oklahoma Gas & Electric Co. Project) 3.57% 11/3/1999 1,900 1,900
Oklahoma Ind. Auth. Rev. VRDO (Health System Baptist Center) 3.55% 11/3/1999 10,500 10,500
Tulsa County OK Independent School Dist. No. 9
Union Board of Educ. 4.50% 6/1/2001 3,500 3,508
Tulsa County OK Independent School Dist. No. 9
Union Board of Educ. 4.50% 6/1/2002 3,500 3,496
Tulsa County OK Independent School Dist. No. 9
Union Board of Educ. 4.625% 6/1/2003 3,500 3,491
-----------
22,895
-----------
OREGON (0.4%)
Oregon Health, Housing, Educ., & Cultural Fac. Auth. College
Housing Project PUT (Portland State Univ.) 5.00% 5/1/2003 LOC 5,240 5,235
Port Auth. of Portland OR Airport Rev. (Portland
International Airport) 5.00% 7/1/2002 (3) 3,195 3,223
-----------
8,458
-----------
PENNSYLVANIA (8.6%)
Allegheny County PA Airport Rev. (Pittsburgh International Airport) 5.00% 1/1/2002 (1) 4,055 4,086
Berks County PA GO 7.25% 11/15/2000 (3)(Prere.) 6,700 7,058
Geisinger Health System Auth. of Pennsylvania VRDO
(Penn State Geisinger Health System) 3.60% 11/2/1999 12,750 12,750
Pennsylvania GO 5.00% 6/1/2001 (1) 14,250 14,421
Pennsylvania GO 5.00% 10/15/2002 5,500 5,585
Pennsylvania GO 5.25% 11/15/2000 (3) 7,500 7,606
Pennsylvania Higher Educ. Fac. Auth. Health Services Rev.
(Allegheny/Delaware Valley) 4.60% 11/15/1999 (1) 4,830 4,830
Pennsylvania Higher Educ. Fac. Auth. Rev. VRDO
(Carnegie Mellon Univ.) 3.60% 11/2/1999 13,800 13,800
Pennsylvania Intergovernmental Cooperation Auth. Rev. 5.00% 6/15/2001 (3) 9,380 9,489
Pennsylvania Intergovernmental Cooperation Auth. Rev. 5.00% 6/15/2002 (3) 10,040 10,175
Pennsylvania Intergovernmental Cooperation Auth. Rev. 5.75% 6/15/2000 (3) 6,675 6,753
Pennsylvania Intergovernmental Cooperation Auth. Rev. 6.00% 6/15/2002 (3) 7,000 7,266
Philadelphia PA Gas Works 7.00% 7/1/2002 (8) 12,090 12,842
Philadelphia PA GO 5.00% 5/15/2000 4,485 4,506
Philadelphia PA GO 5.00% 5/15/2001 5,940 5,973
Philadelphia PA GO 5.00% 5/15/2003 (3) 5,845 5,917
Philadelphia PA GO 6.00% 11/15/1999 (3) 10,000 10,009
Philadelphia PA Muni. Auth. Rev. 8.625% 11/15/2001 (Prere.) 15,500 17,106
Pittsburgh PA GO 5.00% 9/1/2000 (2) 2,250 2,271
-----------
162,443
-----------
RHODE ISLAND (0.5%)
Rhode Island Depositors Econ. Protection Corp. 6.95% 8/1/2002 (Prere.) 9,000 9,749
-----------
SOUTH CAROLINA (0.7%)
Berkeley County SC Exempt Fac. Ind. Rev. VRDO
(Amoco Chemical Co. Project) 3.60% 11/2/1999 2,500 2,500
South Carolina Public Service Auth. Rev. (Santee Cooper) 6.50% 7/1/2002 10,000 10,709
-----------
13,209
-----------
SOUTH DAKOTA (0.2%)
South Dakota Building Auth. Rev. 6.125% 9/1/2000 (ETM) 4,400 4,482
-----------
</TABLE>
15
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<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
FACE MARKET
MATURITY AMOUNT VALUE*
SHORT-TERM TAX-EXEMPT FUND COUPON DATE (000) (000)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
TENNESSEE (0.5%)
Metro. Govt. of Nashville & Davidson County TN 6.15% 5/15/2002 (Prere.) $ 8,050 $ 8,536
-----------
TEXAS (12.5%)
Austin TX Combined Util. System Rev. 7.60% 11/15/1999 (1) 2,300 2,304
Austin TX Combined Util. System Rev. 7.60% 11/15/1999 (1)(ETM) 2,700 2,704
Austin TX Combined Util. System Rev. 11.125% 11/15/1999 (Prere.) 4,000 4,013
Brazos River Auth. Texas PCR PUT (Texas Utility Electric Co.) 3.70% 4/1/2000 27,500 27,451
Fort Worth TX Water & Sewer Rev. 5.90% 2/15/2001 2,900 2,960
Gulf Coast TX IDA Environmental Fac. Rev. VRDO
(Citgo Petroleum Corp. Project) 3.65% 11/2/1999 LOC 2,100 2,100
Harris County TX Capital Appreciation GO 0.00% 10/1/2001 (1) 11,890 10,913
Harris County TX Health Fac. Dev. Corp. (Christus Health) 5.00% 7/1/2001 11,100 11,166
Harris County TX Health Fac. Dev. Corp. Hosp. Rev.
(Hermann Memorial Hosp. System Project) 5.00% 6/1/2000 (4) 4,095 4,119
Harris County TX Health Fac. Dev. Corp. Hosp. Rev.
(Hermann Memorial Hosp. System Project) 5.00% 6/1/2001 (4) 1,500 1,512
Harris County TX Health Fac. Dev. Corp. Hosp. Rev. VRDO
(Methodist Hosp. of Houston) 3.60% 11/2/1999 700 700
Harris County TX Health Fac. Dev. Corp. Hosp. Rev. VRDO
(St. Luke's Episcopal Hosp.) 3.65% 11/2/1999 5,610 5,610
Harris County TX IDA VRDO (Shell Oil Co. Project) 3.50% 11/2/1999 13,850 13,850
Harris County TX Toll Road Refunding GO 6.50% 8/15/2002 (2)(Prere.) 10,000 10,726
Houston TX Refunding and Public Improvement GO 5.00% 3/1/2003 13,500 13,670
Lubbock TX Health Fac. Dev. Corp. Rev.
(St. Joseph Health System Obligated Group) 5.00% 7/1/2000 2,000 2,015
Lubbock TX Health Fac. Dev. Corp. Rev.
(St. Joseph Health System Obligated Group) 5.00% 7/1/2001 2,070 2,094
Matagorda County TX Navigation Dist. No. 1 PCR
(Central Power & Light) PUT 4.90% 11/1/2001 + 7,700 7,700
North East TX Independent School Dist. GO 6.50% 10/1/2002 3,350 3,535
Port Arthur TX Navigation Dist. PCR VRDO (Texaco Inc.) 3.55% 11/2/1999 6,300 6,300
Round Rock TX Independent School Dist. 6.50% 8/1/2002 1,745 1,837
San Antonio TX Electric & Gas Rev. 5.00% 2/1/2002 7,500 7,591
Southwest Texas Higher Educ. Auth. VRDO
(Southern Methodist Univ.) 3.55% 11/2/1999 LOC 1,300 1,300
Tarrant County TX Water Control & Improvement Dist. No. 1 5.90% 3/1/2001 (Prere.) 7,000 7,155
Tarrant County TX Water Control & Improvement Dist. No. 1 6.20% 3/1/2001 (Prere.) 10,000 10,260
Texas GO 5.375% 10/1/2000 5,000 5,069
Texas National Research Lab Comm. (Super Conductors) 7.125% 4/1/2000 (Prere.) 4,125 4,262
Texas TRAN 4.50% 8/31/2000 50,000 50,278
Travis County TX GO 5.00% 3/1/2002 6,090 6,171
Univ. of Texas Board of Regents Rev. 7.00% 8/15/2001 (Prere.) 6,700 7,145
-----------
236,510
-----------
UTAH (1.6%)
Salt Lake City & County UT Airport Rev. VRDO 3.50% 11/4/1999 LOC 12,800 12,800
Utah GO 4.70% 7/1/2000 2,650 2,665
Utah GO 5.50% 7/1/2002 4,000 4,113
Utah GO VRDO 3.35% 11/3/1999 10,600 10,600
-----------
30,178
-----------
VIRGINIA (0.8%)
Virginia Port Auth. Commonwealth Port Fund Rev. 4.60% 7/1/2002 4,900 4,907
Virginia Public School Auth. GO 4.50% 8/1/2001 7,055 7,091
Virginia Public School Auth. GO 5.30% 8/1/2000 2,370 2,396
-----------
14,394
-----------
WASHINGTON (1.2%)
King County WA GO 5.40% 12/1/2002 3,400 3,496
Snohomish County WA Public Util. Dist. Rev. 5.00% 1/1/2000 (3) 3,000 3,006
Spokane WA Regional Solid Waste Management System Rev. 6.25% 1/1/2003 (2) 7,945 8,249
Washington GO 6.40% 9/1/2003 7,000 7,304
-----------
22,055
-----------
</TABLE>
16
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<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
FACE MARKET
MATURITY AMOUNT VALUE*
COUPON DATE (000) (000)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
WEST VIRGINIA (0.3%)
West Virginia Water Dev. Auth. 7.70% 11/1/2000 (Prere.) $ 4,960 $ 5,241
-----------
WISCONSIN (3.5%)
Appleton WI Water System Rev. BAN 3.95% 7/1/2002 18,000 17,891
Milwaukee WI Metro. Sewer Dist. 7.00% 9/1/2001 5,000 5,240
Wisconsin Clean Water Rev. 6.30% 6/1/2000 3,000 3,042
Wisconsin GO 5.80% 5/1/2001 4,000 4,091
Wisconsin GO 6.00% 5/1/2003 4,000 4,185
Wisconsin Housing & EDA Home Ownership Rev. 3.95% 12/1/2000 11,000 10,968
Wisconsin Public Power System Rev. 7.40% 7/1/2000 (2)(Prere.) 19,500 20,332
-----------
65,749
-----------
WYOMING (3.4%)
Wyoming Community Dev. Auth. Housing Rev. 3.60% 12/1/2000 17,090 16,889
Wyoming Community Dev. Auth. Housing Rev. 3.70% 12/1/2000 22,910 22,640
Wyoming Community Dev. Auth. Housing Rev. 3.80% 6/1/2001 9,200 9,161
Wyoming Community Dev. Auth. Housing Rev. 4.25% 8/1/2001 15,000 14,892
-----------
63,582
-----------
- ---------------------------------------------------------------------------------------------------------------------------
TOTAL MUNICIPAL BONDS
(COST $1,911,060) 1,904,895
- ---------------------------------------------------------------------------------------------------------------------------
OTHER ASSETS AND LIABILITIES (-0.6%)
- ---------------------------------------------------------------------------------------------------------------------------
Other Assets--Note B 28,060
Liabilities (40,251)
-----------
(12,191)
-----------
- ---------------------------------------------------------------------------------------------------------------------------
NET ASSETS (100%)
- ---------------------------------------------------------------------------------------------------------------------------
Applicable to 122,286,638 outstanding $.001 par value shares
of beneficial interest (unlimited authorization) $1,892,704
===========================================================================================================================
NET ASSET VALUE PER SHARE $15.48
===========================================================================================================================
</TABLE>
*See Note A in Notes to Financial Statements.
For key to abbreviations and other references, see page 67.
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
AT OCTOBER 31, 1999, NET ASSETS CONSISTED OF:
- ---------------------------------------------------------------------------------------------------------------------------
AMOUNT PER
(000) SHARE
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Paid in Capital $1,898,417 $15.53
Undistributed Net Investment Income -- --
Accumulated Net Realized Gains--Note E 452 --
Unrealized Depreciation--Note F (6,165) (.05)
- ---------------------------------------------------------------------------------------------------------------------------
NET ASSETS $1,892,704 $15.48
===========================================================================================================================
</TABLE>
17
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<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
FACE MARKET
MATURITY AMOUNT VALUE*
LIMITED-TERM TAX-EXEMPT FUND COUPON DATE (000) (000)
- ---------------------------------------------------------------------------------------------------------------------------
MUNICIPAL BONDS (99.2%)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
ALABAMA (1.3%)
Alabama GO 5.50% 10/1/2002 $ 6,500 $ 6,689
Huntsville AL Health Care Fac. Auth. PUT 4.65% 6/1/2005 (1) 26,500 25,864
-----------
32,553
-----------
ALASKA (1.4%)
Alaska Housing Finance Corp. Rev. (State Capital Project) 5.00% 6/1/2004 2,000 1,999
Alaska Housing Finance Corp. Rev. (State Capital Project) 5.00% 12/1/2004 7,200 7,175
Anchorage AK GO 4.70% 8/1/2001 (1) 5,000 5,035
North Slope Borough AK GO 7.25% 6/30/2000 (3) 20,000 20,438
Valdez AK Marine Terminal Rev. VRDO (Exxon Pipeline Co. Project) 3.50% 11/2/1999 2,400 2,400
-----------
37,047
-----------
ARIZONA (2.6%)
Arizona Transp. Board Excise Tax Rev.
(Maricopa County Regional Area Road) 5.00% 7/1/2002 8,880 9,001
Arizona Transp. Board Excise Tax Rev.
(Maricopa County Regional Area Road) 5.00% 7/1/2004 15,165 15,334
Arizona Transp. Board Excise Tax Rev.
(Maricopa County Regional Area Road) 6.00% 7/1/2002 (2) 15,185 15,778
Arizona Transp. Board Highway Rev. 5.50% 7/1/2004 + 15,040 15,490
Phoenix AZ Civic Improvement Corp. Waste Water System 6.125% 7/1/2003 (Prere.) 10,000 10,721
-----------
66,324
-----------
ARKANSAS (0.2%)
Arkansas Dev. Finance Auth. Single Family Mortgage Rev. PUT 2.95% 3/1/2000 5,150 5,136
-----------
CALIFORNIA (5.0%)
California Dept. of Water Rev. (Central Valley Project) 8.25% 12/1/2002 5,060 5,634
California Dept. of Water Rev. (Central Valley Project) 8.25% 12/1/2001 4,790 5,186
California Dept. of Water Rev. (Central Valley Project) 8.25% 12/1/2005 5,685 6,762
California GO 7.50% 11/1/2003 (3) 6,000 6,679
California GO 9.00% 6/1/2000 5,000 5,156
California GO 10.50% 10/1/2000 3,000 3,183
California Public Works Board Lease Rev.
(Univ. of California Project) 5.50% 9/1/2005 (2) 3,900 4,088
California Statewide Community Dev. Auth.
(St. Joseph Health System) 5.00% 7/1/2004 4,055 4,100
Los Angeles CA Dept. of Water & Power Waterworks Rev. 9.00% 5/15/2002 9,135 10,136
Los Angeles CA Dept. of Water & Power Waterworks Rev. 9.00% 5/15/2003 5,355 6,132
Los Angeles County CA Public Works Auth. 5.00% 10/1/2004 3,640 3,729
Los Angeles County CA Public Works Auth. 6.00% 10/1/2003 13,010 13,771
Los Angeles County CA School Pooled Financing Program TRAN 4.00% 9/29/2000 10,000 10,038
San Joaquin Hills CA Transp. Corridor Agency Toll Road Rev. 0.00% 1/15/2000 (1) 2,000 1,984
San Joaquin Hills CA Transp. Corridor Agency Toll Road Rev. 0.00% 1/15/2001 (1) 10,000 9,512
San Joaquin Hills CA Transp. Corridor Agency Toll Road Rev. 0.00% 1/15/2002 21,815 19,652
Univ. of California Rev. (Multiple Purpose Dist. Project) 10.00% 9/1/2000 (2) 7,755 8,158
Univ. of California Rev. (Multiple Purpose Dist. Project) 10.00% 9/1/2001 (2) 5,500 6,070
-----------
129,970
-----------
COLORADO (1.0%)
Arapahoe County CO Capital Improvement Trust Fund Highway Rev. 0.00% 8/31/2005 (Prere.) 43,920 18,006
Denver CO City & County Airport Rev. 7.50% 11/15/2002 6,080 6,452
-----------
24,458
-----------
CONNECTICUT (3.2%)
Connecticut GO 5.30% 3/15/2004 9,500 9,764
Connecticut GO 5.50% 11/1/2001 13,630 13,979
Connecticut GO 6.00% 11/15/2004 7,500 7,939
Connecticut GO 6.25% 11/15/2002 (Prere.) 5,300 5,676
Connecticut GO 6.25% 5/15/2005 13,700 14,712
Connecticut GO 9.875% 3/1/2001 6,750 7,239
Connecticut Special Assessment Second Injury Fund Rev. 5.00% 1/1/2001 4,230 4,271
</TABLE>
18
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<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
FACE MARKET
MATURITY AMOUNT VALUE*
COUPON DATE (000) (000)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Connecticut Special Assessment Unemployment Compensation Rev. 5.50% 5/15/2001 (2) $ 13,455 $ 13,718
Connecticut Special Tax Obligation Rev. (Transp. Infrastructure) 6.25% 10/1/2002 (3) 4,000 4,200
-----------
81,498
-----------
DELAWARE (0.3%)
Delaware GO 5.00% 1/1/2002 5,085 5,154
Delaware GO 5.00% 4/1/2002 3,000 3,043
-----------
8,197
-----------
DISTRICT OF COLUMBIA (2.3%)
District of Columbia GO 4.90% 6/1/2000 19,020 19,101
District of Columbia GO 4.90% 6/1/2000 (ETM) 980 985
District of Columbia GO 5.00% 6/1/2002 (1) 5,710 5,766
District of Columbia GO 5.00% 6/1/2003 (1) 5,995 6,048
District of Columbia GO 5.00% 6/1/2005 (1) 3,000 2,998
District of Columbia GO 5.50% 6/1/2001 5,000 5,065
District of Columbia GO 5.50% 6/1/2002 15,000 15,230
Metro. Washington DC Airports Auth. General Airport Rev. 5.50% 10/1/2006 4,745 4,854
-----------
60,047
-----------
FLORIDA (3.1%)
Dade County FL School Dist. GO 5.00% 2/15/2001 (1) 4,525 4,572
Florida Board of Educ. Rev. (Capital Outlay) 6.50% 6/1/2004 5,565 5,983
Florida Board of Educ. Rev. (Capital Outlay) 6.50% 6/1/2002 4,505 4,733
Florida Dept. of General Services Rev.
(Dept. of Environmental Protection Preservation-2000) 6.00% 7/1/2004 (2) 10,815 11,430
Florida Inland Protection Financing Corp. 5.00% 7/1/2003 (4) 5,000 5,075
Florida School Board Assn. Rev. (Orange County) 7.00% 7/1/2000 (2) 13,820 14,107
Lakeland FL Electric & Water Rev. 6.30% 10/1/2002 (4) 5,000 5,256
Lee County FL School Board COP 6.00% 8/1/2002 (4) 2,750 2,863
Miami-Dade County FL School Board COP 5.25% 8/1/2005 (4) 6,155 6,308
Orange County FL Health Fac. Auth. Rev.
(Orlando Regional Healthcare) 6.00% 10/1/2004 (1) 1,160 1,224
Orange County FL Health Fac. Auth. Rev.
(Orlando Regional Healthcare) 6.00% 10/1/2004 (1)(ETM) 2,815 2,978
Tampa FL Health System Rev. (Catholic Healthcare East) 5.00% 11/15/2002 (1) 8,035 8,162
Tampa FL Health System Rev. (Catholic Healthcare East) 5.25% 11/15/2003 (1) 2,500 2,560
Tampa FL Hillsborough County Expressway Auth. Rev. 6.50% 7/1/2003 (2) 4,770 5,086
-----------
80,337
-----------
GEORGIA (1.9%)
Cobb County GA School Dist. GO 5.00% 2/1/2000 8,040 8,064
Georgia GO 5.75% 3/1/2002 5,600 5,775
Georgia GO 7.20% 3/1/2002 3,000 3,186
Georgia GO 7.25% 7/1/2002 5,620 6,021
Georgia GO 7.25% 9/1/2002 8,160 8,776
Georgia GO 7.40% 8/1/2002 12,360 13,310
Metro. Atlanta GA Rapid Transp. Auth. Sales Tax Rev. 6.35% 7/1/2004 3,560 3,729
-----------
48,861
-----------
HAWAII (2.9%)
Hawaii GO 5.25% 4/1/2004 (1) 14,600 14,905
Hawaii GO 5.50% 4/1/2004 (1) 11,920 12,287
Hawaii GO 5.50% 4/1/2005 (1) 13,630 14,054
Hawaii GO 5.70% 10/1/2004 (1) 10,000 10,417
Hawaii GO 7.75% 2/1/2002 9,600 10,233
Honolulu HI City & County GO 5.25% 11/1/2003 (3) 13,135 13,434
-----------
75,330
-----------
ILLINOIS (5.0%)
Chicago IL GO 6.25% 10/31/2002 (1) 4,250 4,454
Chicago IL Metro. Water Reclamation Dist. GO 4.70% 12/1/1999 7,710 7,716
Chicago IL Public Building Commission Board of Educ. GO 5.125% 2/1/2003 (3) 7,500 7,608
Chicago IL School Finance Auth. GO 5.00% 6/1/2003 (3) 25,190 25,453
Chicago IL School Finance Auth. GO 5.10% 6/1/2004 (3) 10,000 10,114
Illinois Dev. Finance Auth. PCR PUT (Commonwealth Edison) 4.40% 12/1/2006 (2) 19,000 18,028
</TABLE>
19
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<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
FACE MARKET
MATURITY AMOUNT VALUE*
LIMITED-TERM TAX-EXEMPT FUND COUPON DATE (000) (000)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Illinois Dev. Finance Auth. Rev. (Provena Health) 5.50% 5/15/2004 (1) $ 4,740 $ 4,856
Illinois Dev. Finance Auth. Rev. (Provena Health) 5.50% 5/15/2005 (1) 2,500 2,557
Illinois Dev. Finance Auth. Rev. (Provena Health) 5.50% 5/15/2006 (1) 2,000 2,042
Illinois Educ. Fac. Auth. Rev. PUT (Univ. of Chicago) 4.40% 7/1/2004 6,225 6,124
Illinois Health Fac. Auth. Rev. (Advocate Health Care Network) 5.25% 8/15/2005 3,700 3,702
Illinois Health Fac. Auth. Rev. (Alexian Brothers Health System) 5.00% 1/1/2001 4,815 4,817
Illinois Health Fac. Auth. Rev. (Hosp. Sisters Services Inc.) 5.00% 6/1/2003 (1) 2,895 2,922
Illinois Health Fac. Auth. Rev. (Hosp. Sisters Services Inc.) 5.00% 6/1/2004 (1) 3,080 3,099
Illinois Health Fac. Auth. Rev. (Hosp. Sisters Services Inc.) 5.00% 6/1/2006 (1) 4,400 4,375
Illinois Health Fac. Auth. Rev. (Hosp. Sisters Services Inc.) 5.25% 6/1/2007 (1) 5,270 5,289
Illinois Health Fac. Auth. Rev. PUT (Edgewater Medical Center) 4.70% 7/1/2004 LOC 11,120 10,941
Metro. Pier & Exposition Auth. IL Dedicated State Tax Rev. 6.50% 6/15/2003 (Prere.) 4,140 4,483
-----------
128,580
-----------
INDIANA (0.9%)
Indianapolis IN Airport Auth. Rev. 5.00% 7/1/2004 (3) 14,535 14,600
Richmond IN Hosp. Auth. Rev. PUT
(Reid Hosp. and Health Care Services) 4.35% 1/1/2002 10,000 9,857
-----------
24,457
-----------
KANSAS (0.7%)
Burlington KS Environmental Rev. Refunding PUT
(Kansas City Power & Light Co. Project) 4.35% 9/1/2001 15,810 15,710
Unified Govt. of Wyandotte County Kansas City KS
Util. System Improvement Refunding Rev. 5.00% 9/1/2004 (1) 2,500 2,534
-----------
18,244
-----------
KENTUCKY (0.4%)
Kentucky Property & Building Comm. Rev. 6.00% 11/1/2002 2,000 2,083
Kentucky Property & Building Comm. Rev. 6.75% 11/1/1999 9,500 9,502
-----------
11,585
-----------
LOUISIANA (3.3%)
Jefferson Parish LA Sales Tax Dist. Special Sales Tax Rev. 5.50% 12/1/2004 (4) 5,145 5,320
Jefferson Parish LA Sales Tax Dist. Special Sales Tax Rev. 5.50% 12/1/2005 (4) 3,790 3,912
Louisiana GO 5.50% 4/15/2002 (4) 6,160 6,308
Louisiana GO 6.00% 8/1/2000 (3) 5,000 5,079
Louisiana GO 6.00% 8/1/2001 (3) 19,325 19,887
Louisiana Public Fac. Auth. Hosp. Rev. (Franciscan Missionaries) 5.50% 7/1/2005 (4) 5,865 6,014
New Orleans LA GO 6.50% 10/1/2001 (2) 10,655 11,083
St. Charles Parish LA PCR PUT (Entergy Inc.) 4.85% 6/1/2002 18,000 17,840
St. Charles Parish LA PCR PUT (Entergy Inc.) 5.35% 10/1/2003 10,000 9,958
-----------
85,401
-----------
MAINE (0.2%)
Maine Health & Higher Educ. (Sebasticook Hosp.) 10.10% 7/1/2001 (Prere.) 4,250 4,726
-----------
MARYLAND (0.4%)
Maryland Health & Higher Educ. Fac. Auth.
VRDO (Johns Hopkins Hosp.) 3.45% 11/3/1999 LOC 10,000 10,000
-----------
MASSACHUSETTS (4.6%)
Massachusetts Bay Transit Auth. Rev. 5.00% 3/1/2003 5,000 5,071
Massachusetts Educ. Finance Auth. Educ. Loan Rev. 4.40% 12/1/2005 2,345 2,257
Massachusetts Educ. Finance Auth. Educ. Loan Rev. 4.50% 12/1/2006 2,835 2,714
Massachusetts Educ. Finance Auth. Educ. Loan Rev. 4.55% 12/1/2007 3,815 3,619
Massachusetts GO 5.00% 4/1/2004 8,500 8,614
Massachusetts GO 6.25% 7/1/2002 12,500 13,070
Massachusetts GO 6.875% 7/1/2001 (Prere.) 17,400 18,469
Massachusetts GO 7.00% 12/1/2000 (Prere.) 5,000 5,166
Massachusetts GO 7.50% 12/1/2000 (Prere.) 24,750 26,173
Massachusetts GO 9.25% 7/1/2000 10,000 10,351
Massachusetts Health & Educ. Fac. Auth. Rev.
(Caritas Christi Obligated Group) 5.25% 7/1/2001 3,795 3,797
Massachusetts Health & Educ. Fac. Auth. Rev.
(Caritas Christi Obligated Group) 5.25% 7/1/2004 2,500 2,458
</TABLE>
20
<PAGE> 63
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
FACE MARKET
MATURITY AMOUNT VALUE*
COUPON DATE (000) (000)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Massachusetts Health & Educ. Fac. Auth. Rev.
(Caritas Christi Obligated Group) 5.25% 7/1/2005 $ 3,930 $ 3,833
Massachusetts Health & Educ. Fac. Auth. Rev. PUT
(Fairview Extended Care) 4.55% 7/14/2002 (1) 3,450 3,428
Massachusetts Water Resources Auth. 6.875% 12/1/2001 (Prere.) 9,945 10,655
-----------
119,675
-----------
MICHIGAN (7.1%)
Detroit MI GO 5.60% 5/1/2000 (2) 7,040 7,101
Detroit MI GO 5.70% 5/1/2001 (2) 5,000 5,104
Greater Detroit MI Resource Recovery Auth. Rev. 5.00% 12/13/2000 (2) 6,290 6,363
Greater Detroit MI Resource Recovery Auth. Rev. 5.50% 12/13/2001 (2) 5,000 5,123
Greater Detroit MI Resource Recovery Auth. Rev. 5.50% 12/13/2003 (2) 17,995 18,578
Greater Detroit MI Resource Recovery Auth. Rev. 5.50% 12/13/2004 (2) 12,990 13,434
Michigan Building Auth. Rev. 5.25% 10/15/2003 13,890 14,215
Michigan Building Auth. Rev. 5.25% 10/15/2004 19,885 20,346
Michigan Building Auth. Rev. 6.20% 10/1/2002 5,450 5,709
Michigan Building Auth. Rev. 6.30% 10/1/2003 (4) 7,800 8,208
Michigan Building Auth. Rev. 6.50% 10/1/2004 6,500 6,997
Michigan Building Auth. Rev. (Fac. Program) 5.00% 10/15/2005 9,260 9,336
Michigan GO (Environmental Protection Program) 6.00% 11/1/2002 4,845 5,063
Michigan GO (Recreation Program) 6.00% 11/1/2000 11,910 12,161
Michigan GO (Recreation Program) 6.00% 11/1/2001 5,910 6,112
Michigan Hosp. Finance Auth. (Genesys Regional Medical) 5.25% 10/1/2003 2,500 2,559
Michigan Hosp. Finance Auth. (Genesys Regional Medical) 5.50% 10/1/2005 6,655 6,879
Michigan Strategic Fund Limited Obligation Rev. PUT (Detroit Edison) 4.73% 9/1/2001 10,000 9,980
Royal Oak MI Hosp. Financial Auth. (William Beaumont Hosp.) 6.75% 1/1/2001 (Prere.) 12,450 13,049
Wayne Charter County MI Airport Rev. (Detroit Metro. Wayne County) 5.25% 12/1/2006 (1) 6,620 6,678
-----------
182,995
-----------
MINNESOTA (0.5%)
Minneapolis MN Community Dev. Agency Tax Increment Rev.
(Capital Appreciation) 0.00% 9/1/2003 (1) 5,875 4,906
Minnesota GO 6.00% 8/1/2004 5,000 5,296
Minnesota Public Fac. Water Rev. PCR 5.00% 3/1/2002 2,620 2,657
-----------
12,859
-----------
MISSOURI
Missouri Health & Educ. Fac. Auth. VRDO (Washington Univ.) 3.55% 11/2/1999 900 900
-----------
MONTANA (0.5%)
Forsyth MT PCR PUT (Portland General Electric Co.) 4.60% 5/1/2003 12,410 12,311
-----------
NEVADA (1.4%)
Clark County NV Passenger Fac. Charge Rev.
(McCarran International Airport) 6.25% 7/1/2004 (1) 8,240 8,755
Clark County NV Passenger Fac. Charge Rev.
(McCarran International Airport) 6.25% 7/1/2005 (1) 4,310 4,566
Clark County NV School Dist. GO 6.00% 6/15/2003 (3) 4,830 5,055
Clark County NV School Dist. GO 9.75% 6/1/2001 (1) 10,000 10,820
Nevada GO 5.00% 7/1/2004 7,030 7,108
-----------
36,304
-----------
NEW HAMPSHIRE (0.4%)
New Hampshire Business Finance Auth. PCR PUT
(United Illuminating) 4.55% 2/1/2004 10,000 9,680
-----------
NEW JERSEY (1.2%)
New Jersey Transp. Trust Fund Auth. Rev. 6.00% 6/15/2000 12,655 12,822
New Jersey Transp. Trust Fund Auth. Rev. 6.00% 6/15/2003 (2) 5,000 5,241
New Jersey Turnpike Auth. Rev. 5.60% 1/1/2000 (2) 4,000 4,012
Passaic County NJ Util. Solid Waste Disposal Rev. 0.00% 3/1/2000 (1) 4,220 4,163
Passaic Valley NJ Sewer System Rev. 5.70% 12/1/2003 (2) 3,980 4,150
-----------
30,388
-----------
</TABLE>
21
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<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
FACE MARKET
MATURITY AMOUNT VALUE*
LIMITED-TERM TAX-EXEMPT FUND COUPON DATE (000) (000)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
NEW MEXICO (0.7%)
Albuquerque NM Water & Sewer System Rev. 5.00% 7/1/2004 $ 4,500 $ 4,565
Albuquerque NM Water & Sewer System Rev. 5.00% 7/1/2005 4,000 4,039
New Mexico Severance Tax Rev. 5.00% 7/1/2002 9,600 9,738
-----------
18,342
-----------
NEW YORK (15.5%)
Hempstead Town NY IDA Resource Recovery (American Fuel Co.) 4.40% 12/1/2001 (1) 6,810 6,826
Long Island NY Power Auth. Electric System Rev. 5.25% 12/1/2004 (2) 15,000 15,355
Long Island NY Power Auth. Electric System Rev. 5.25% 12/1/2005 (2) 17,000 17,336
Long Island NY Power Auth. Electric System Rev. 5.50% 12/1/2006 (2) 8,000 8,250
Muni. Assistance Corp. for New York City NY 5.00% 7/1/2003 7,200 7,301
Muni. Assistance Corp. for New York City NY 5.50% 7/1/2000 42,940 43,409
Muni. Assistance Corp. for New York City NY 5.50% 7/1/2002 5,500 5,645
Muni. Assistance Corp. for New York City NY 6.00% 7/1/2000 (2) 10,000 10,142
Muni. Assistance Corp. for New York City NY 6.00% 7/1/2005 10,370 10,965
New York City NY GO 5.00% 8/1/2003 (1) 4,400 4,467
New York City NY GO 7.50% 2/1/2002 (Prere.) 4,615 4,984
New York City NY GO 7.50% 8/1/2002 (Prere.) 4,440 4,853
New York City NY GO 7.625% 2/1/2002 (Prere.) 4,600 4,980
New York City NY GO 7.70% 2/1/2002 (Prere.) 3,350 3,632
New York City NY GO VRDO 3.50% 11/2/1999 (1) 3,950 3,950
New York City NY IDA (USTA National Tennis Center Project) 7.75% 11/15/2000 (4) 3,125 3,247
New York City NY IDA (USTA National Tennis Center Project) 7.75% 11/15/2001 (4) 4,380 4,676
New York City NY IDA (USTA National Tennis Center Project) 7.75% 11/15/2002 (4) 3,100 3,384
New York State COP 5.00% 9/1/2002 4,050 4,088
New York State Dormitory Auth. Rev. (Bronx/Lebanon Hosp.) 5.00% 2/15/2002 5,000 5,040
New York State Dormitory Auth. Rev. (Brookdale Hosp.) 5.00% 2/15/2002 5,445 5,492
New York State Dormitory Auth. Rev. (Brookdale Hosp.) 5.50% 2/15/2004 6,040 6,183
New York State Dormitory Auth. Rev. (City Univ.) 7.625% 7/1/2000 (Prere.) 6,200 6,474
New York State Dormitory Auth. Rev. (City Univ.) 7.875% 7/1/2000 (Prere.) 15,725 16,446
New York State Dormitory Auth. Rev. (City Univ.) 9.00% 7/1/2000 (3) 15,515 16,035
New York State Dormitory Auth. Rev. (Dept. of Health) 7.70% 7/1/2000 (Prere.) 6,790 7,094
New York State Dormitory Auth. Rev. (North General Hosp.) 5.00% 2/15/2002 4,710 4,748
New York State Dormitory Auth. Rev. (North General Hosp.) 5.50% 2/15/2003 4,945 5,054
New York State Dormitory Auth. Rev. (Presbyterian Hosp.) 5.50% 2/15/2002 (2) 4,000 4,083
New York State Dormitory Auth. Rev. (Presbyterian Hosp.) 5.50% 2/15/2003 (2) 8,620 8,834
New York State Dormitory Auth. Rev. (Presbyterian Hosp.) 5.50% 2/15/2004 (2) 4,500 4,621
New York State Dormitory Auth. Rev. (State Univ.) 7.70% 5/15/2000 (Prere.) 6,500 6,761
New York State Dormitory Auth. Rev. (Univ. of Rochester) 5.00% 7/1/2003 (1) 3,210 3,258
New York State Dormitory Auth. VRDO (Cornell Univ.) 3.55% 11/2/1999 1,000 1,000
New York State Energy Research & Dev. Auth. PCR PUT
(Central Hudson Gas & Electric Corp.) 4.20% 12/1/2003 (2) 7,390 7,179
New York State Environmental Fac. Rev.
(Clean Water & Drinking Revolving Funds) 5.00% 6/15/2003 4,285 4,346
New York State Environmental Fac. Rev.
(Clean Water & Drinking Revolving Funds) 5.00% 6/15/2004 4,000 4,046
New York State Environmental Fac. (Riverbank State Park) 7.375% 4/1/2002 (Prere.) 6,800 7,384
New York State Environmental Fac. PCR
(New York City Water Finance Auth.) 5.50% 6/15/2003 (1) 3,000 3,094
New York State Housing Finance Agency Rev.
(Nursing Home & Health Care Project) 4.40% 11/1/2004 (1) 9,040 8,818
New York State Housing Finance Agency Rev.
(Nursing Home & Health Care Project) 4.50% 11/1/2005 (1) 7,475 7,245
New York State Housing Finance Agency Rev.
(Nursing Home & Health Care Project) 4.60% 11/1/2006 (1) 4,450 4,302
New York State Housing Finance Agency Rev. 8.00% 11/1/2000 (Prere.) 4,140 4,386
New York State Local Govt. Assistance Corp. 6.25% 4/1/2002 (Prere.) 10,000 10,607
New York State Local Govt. Assistance Corp. 7.00% 4/1/2001 (Prere.) 6,875 7,268
New York State Medical Care Fac. Finance Agency Rev. 7.875% 8/15/2000 (Prere.) 8,000 8,402
New York State Thruway Auth. (Highway & Bridge Trust Fund) 5.00% 4/1/2003 (3) 4,350 4,411
New York State Thruway Auth. (Highway & Bridge Trust Fund) 5.25% 4/1/2002 (3) 10,000 10,191
New York State Thruway Auth. (Highway & Bridge Trust Fund) 6.00% 4/1/2002 (1) 11,965 12,397
</TABLE>
22
<PAGE> 65
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
FACE MARKET
MATURITY AMOUNT VALUE*
COUPON DATE (000) (000)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
New York State Urban Dev. Corp. Rev.
(Community Enhancement Fac.) 5.00% 4/1/2004 $ 8,570 $ 8,600
New York State Urban Dev. Corp. Rev. (Correctional Fac.) 7.50% 1/1/2001 (Prere.) 7,100 7,502
Suffolk County NY Water Auth. Water System Rev. 5.25% 6/1/2004 (2)(Prere.) 10,000 10,253
-----------
399,044
-----------
NORTH CAROLINA (0.2%)
Mecklenberg County NC GO 5.90% 3/1/2005 4,075 4,244
-----------
OHIO (2.8%)
Butler County OH Transp. Improvement Dist. 5.00% 4/1/2003 (4) 3,000 3,042
Cleveland OH School Dist. RAN 5.00% 6/1/2001 (2) 6,000 6,070
Cleveland OH Water Works Rev. 6.25% 1/1/2002 (2)(Prere.) 4,245 4,487
Franklin County OH PUT (U.S. Health Corp.) 4.50% 6/1/2000 LOC 10,000 10,019
Ohio Air Quality Dev. Auth. PCR PUT (Cleveland Electric) 4.60% 10/1/2003 4,500 4,349
Ohio Water Dev. Auth. PCR (Cleveland Electric) 5.58% 6/15/2004 21,700 21,266
Ohio Water Dev. Auth. PCR PUT (Cleveland Electric) 4.60% 10/1/2003 12,255 11,824
Ohio Water Dev. Auth. PCR PUT (Toledo Edison) 5.25% 9/1/2002 10,000 9,934
-----------
70,991
-----------
OKLAHOMA (0.9%)
Oklahoma Dev. Finance Auth. (Hillcrest Hosp.) 4.80% 8/15/2006 2,000 1,845
Oklahoma Dev. Finance Auth. (Hillcrest Hosp.) 4.90% 8/15/2007 2,195 2,011
Oklahoma Dev. Finance Auth. (Hillcrest Hosp.) 5.00% 8/15/2008 1,500 1,367
Tulsa County OK Criminal Justice Auth. Sales Tax Rev. 5.25% 9/1/2001 (2) 6,960 7,070
Tulsa County OK Criminal Justice Auth. Sales Tax Rev. 5.25% 3/1/2001 (2) 6,525 6,601
Tulsa County OK Independent School Dist. 4.75% 6/1/2004 3,500 3,491
-----------
22,385
-----------
OREGON (0.2%)
Port Auth. of Portland OR Airport Rev. (Portland International 5.00% 7/1/2003 (3) 5,035 5,070
Airport) -----------
PENNSYLVANIA (5.5%)
Delaware County PA IDA PCR (PECO Energy Co. Project) 5.20% 10/1/2004 11,000 10,938
Delaware County PA IDA Rev. (Resource Recovery Fac.) 5.50% 1/1/2002 1,865 1,840
Pennsylvania GO 5.00% 5/1/2000 2,710 2,726
Pennsylvania GO 5.00% 3/1/2003 6,250 6,333
Pennsylvania GO 5.25% 11/15/2001 (3) 10,000 10,200
Pennsylvania GO 5.375% 11/15/2003 (3) 2,000 2,058
Pennsylvania GO 5.40% 7/1/2000 4,000 4,041
Pennsylvania Higher Educ. Fac. Health Services
(Allegheny/Delaware Valley) 5.00% 11/15/2002 (1) 7,990 7,995
Pennsylvania Intergovernmental Cooperation Auth. Rev. 6.00% 6/15/2001 (3) 10,000 10,272
Pennsylvania Intergovernmental Cooperation Auth. Rev.
(Philadelphia Funding Program) 5.00% 6/15/2003 (3) 5,000 5,066
Pennsylvania Intergovernmental Cooperation Auth. Rev.
(Philadelphia Funding Program) 6.80% 6/15/2002 (Prere.) 5,050 5,348
Pennsylvania Turnpike Comm. Rev. 5.60% 12/1/2005 (3) 6,575 6,774
Pennsylvania Turnpike Comm. Rev. 7.50% 12/1/1999 (Prere.) 15,000 15,348
Philadelphia PA Gas Works 7.00% 7/1/2002 (8) 4,035 4,286
Philadelphia PA GO 6.00% 11/15/1999 (3) 8,505 8,513
Philadelphia PA GO 6.00% 11/15/2000 (3) 13,000 13,274
Philadelphia PA Hosp. & Higher Educ. Fac. Auth. Rev.
(Jefferson Health System) 5.00% 5/15/2002 (2) 2,905 2,935
Philadelphia PA Hosp. & Higher Educ. Fac. Auth. Rev.
(Jefferson Health System) 5.00% 5/15/2004 (2) 4,990 5,024
Philadelphia PA Hosp. & Higher Educ. Fac. Auth. Rev.
(Jefferson Health System) 5.50% 5/15/2003 (2) 1,425 1,461
Philadelphia PA Ind. Dev. Airport Rev.
(Philadelphia Airport System Project) 4.50% 7/1/2002 (3) 2,205 2,197
Philadelphia PA Ind. Dev. Airport Rev.
(Philadelphia Airport System Project) 5.25% 6/15/2001 (3) 4,590 4,661
Philadelphia PA Water & Waste Water Rev. 6.25% 8/1/2002 (1) 5,450 5,698
Pittsburgh PA GO 5.00% 3/1/2003 (1) 5,000 5,061
-----------
142,049
-----------
</TABLE>
23
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<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
FACE MARKET
MATURITY AMOUNT VALUE*
LIMITED-TERM TAX-EXEMPT FUND COUPON DATE (000) (000)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
RHODE ISLAND (0.9%)
Rhode Island GO 6.00% 8/1/2003 (1) $ 9,665 $ 10,139
Rhode Island GO 6.00% 8/1/2004 (1) 11,345 11,981
-----------
22,120
-----------
SOUTH CAROLINA (0.7%)
South Carolina Capital Improvement GO 5.00% 8/1/2004 4,950 5,035
South Carolina GO 5.10% 2/1/2004 3,940 4,017
South Carolina Transp. Infrastructure Rev. 5.00% 10/1/2007 (1) 9,445 9,432
-----------
18,484
-----------
TENNESSEE (0.4%)
Johnson City TN Health & Higher Educ. Fac. Board Rev.
(Johnson City Medical Center) 5.00% 7/1/2005 (1) 4,265 4,277
Memphis TN Refunding GO 5.00% 10/1/2003 4,750 4,822
-----------
9,099
-----------
TEXAS (11.7%)
Austin TX Util. System 5.375% 11/15/2005 6,495 6,574
Austin TX Util. System 9.50% 5/15/2000 (Prere.) 5,705 5,876
Austin TX Util. System 10.00% 5/15/2000 (Prere.) 5,000 5,163
El Paso County TX Hosp. Dist. GO 0.00% 8/15/2000 (1) 2,260 2,188
El Paso County TX Hosp. Dist. GO 0.00% 8/15/2001 (1) 2,260 2,085
El Paso County TX Hosp. Dist. GO 0.00% 8/15/2002 (1) 2,260 1,982
El Paso County TX Hosp. Dist. GO 0.00% 8/15/2003 (1) 2,260 1,882
Harris County TX Flood Control Dist. GO 5.50% 10/1/2000 3,000 3,044
Harris County TX GO 5.50% 10/1/2000 2,645 2,684
Harris County TX Health Fac. Dev. Corp. (Christus Health) 5.00% 7/1/2002 11,680 11,726
Harris County TX Health Fac. Dev. Corp. (Christus Health) 5.00% 7/1/2003 12,250 12,257
Harris County TX Health Fac. Dev. Corp. (Memorial Hosp.) 5.00% 6/1/2000 (1) 3,025 3,042
Harris County TX Health Fac. Dev. Corp. (Memorial Hosp.) 5.00% 6/1/2001 (1) 5,835 5,883
Harris County TX Toll Road GO 6.125% 8/15/2004 6,375 6,877
Harris County TX Toll Road GO 6.50% 8/15/2002 (2)(Prere.) 5,765 6,183
Houston TX GO 5.00% 3/1/2003 20,000 20,264
Houston TX GO 5.50% 3/1/2004 8,620 8,884
Houston TX GO 5.90% 3/1/2002 (Prere.) 980 1,012
Houston TX GO 5.90% 3/1/2003 2,495 2,567
Houston TX Hotel Occupancy Tax Rev. 6.00% 7/1/2000 (4) 4,250 4,308
Houston TX Hotel Occupancy Tax Rev. 6.00% 7/1/2001 (4) 4,000 4,106
Houston TX Hotel Occupancy Tax Rev. 6.00% 7/1/2002 (4) 2,250 2,333
Houston TX Independent School Dist. 0.00% 2/15/2006 4,000 2,881
Houston TX Independent School Dist. 6.40% 8/15/2001 (Prere.) 4,095 4,250
Houston TX Refunding & Public Improvement GO 5.00% 3/1/2004 12,000 12,125
Houston TX Water & Sewer System Rev. 0.00% 12/1/2000 (2) 6,130 5,864
Houston TX Water & Sewer System Rev. 5.40% 12/1/2000 8,000 8,114
Klein TX Independent School Dist. GO 0.00% 8/1/2003 6,690 5,588
Lewisville TX Independent School Dist. 6.55% 8/15/2003 (ETM) 5,000 5,353
Lubbock TX Health Fac. Dev. Corp. Rev.
(St. Joseph Health System Obligated Group) 5.00% 7/1/2003 6,505 6,589
Lubbock TX Health Fac. Dev. Corp. Rev.
(St. Joseph Health System Obligated Group) 5.00% 7/1/2004 6,440 6,506
Lubbock TX Health Fac. Dev. Corp. Rev.
(St. Joseph Health System Obligated Group) 5.00% 7/1/2005 7,610 7,647
Matagorda County TX Navigation Dist. No. 1 PCR
(Central Power & Light) 4.90% 11/1/2001 + 15,000 15,000
North East TX Independent School Dist. GO 6.50% 10/1/2005 4,075 4,415
North East TX Independent School Dist. GO 6.50% 10/1/2006 4,350 4,738
Plano TX Independent School Dist. GO 6.00% 2/15/2003 4,510 4,706
San Antonio TX GO 5.40% 8/1/2002 (Prere.) 725 743
San Antonio TX GO 5.40% 8/1/2004 6,770 6,894
San Antonio TX Independent School Dist. 6.00% 8/15/2004 4,165 4,398
Texas Muni. Power Agency Rev. 5.25% 9/1/2004 (1) 5,300 5,422
Texas Muni. Power Agency Rev. 5.80% 9/1/2003 (1) 6,750 7,036
Texas Public Finance Auth. Refunding 5.50% 10/1/2006 4,000 4,142
Texas TRAN 4.50% 8/31/2000 25,000 25,139
</TABLE>
24
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<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
FACE MARKET
MATURITY AMOUNT VALUE*
COUPON DATE (000) (000)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Texas Water Dev. Financial Assistance Refunding GO 5.00% 8/1/2004 $ 4,735 $ 4,790
Texas Water Dev. Financial Assistance Refunding GO 5.00% 8/1/2005 3,405 3,429
Univ. of Texas Board of Regents Rev. 5.00% 8/15/2004 5,645 5,724
Univ. of Texas Permanent Univ. Fund 6.10% 7/1/2004 11,555 11,985
Univ. of Texas Permanent Univ. Fund 6.50% 7/1/2001 (Prere.) 4,285 4,523
Univ. of Texas Permanent Univ. Fund 9.50% 7/1/2000 3,545 3,675
-----------
302,596
-----------
UTAH (0.8%)
Intermountain Power Agency UT Power Supply Rev.
Capital Appreciation 0.00% 7/1/2002 7,825 6,888
Intermountain Power Agency UT Power Supply Rev.
Capital Appreciation 0.00% 7/1/2002 (2) 8,490 7,495
Utah GO VRDO 3.35% 11/3/1999 1,000 1,000
Utah Water Finance Agency Rev. 4.70% 10/1/2001 (1) 5,000 5,040
-----------
20,423
-----------
VIRGINIA (1.3%)
Virginia Port Auth. Rev. 4.75% 7/1/2004 8,210 8,193
Virginia Public School Auth. GO 5.00% 8/1/2000 6,345 6,400
Virginia Public School Auth. GO 5.00% 8/1/2002 12,415 12,608
Virginia Public School Auth. GO 5.00% 8/1/2003 6,200 6,301
-----------
33,502
-----------
WASHINGTON (3.6%)
King County WA School Dist. GO 6.30% 12/1/2003 5,375 5,670
Port Seattle WA Passenger Fac. Charge Rev. 5.00% 12/1/2003 (2) 3,000 3,022
Port Seattle WA Passenger Fac. Charge Rev. 5.00% 12/1/2004 (2) 7,465 7,501
Spokane WA Regional Solid Waste Management System Rev. 6.25% 1/1/2004 (2) 8,440 8,810
Spokane WA Regional Solid Waste Management System Rev. 6.25% 1/1/2005 (2) 8,975 9,393
Spokane WA Regional Solid Waste Management System Rev. 6.50% 1/1/2007 (2) 5,150 5,470
Washington GO 6.10% 9/1/2000 5,000 5,092
Washington GO 6.30% 9/1/2002 4,700 4,894
Washington GO 6.50% 7/1/2002 5,035 5,291
Washington GO 6.625% 9/1/2006 4,000 4,189
Washington GO 6.75% 6/1/2001 (Prere.) 20,000 20,769
Washington GO 7.00% 8/1/2002 4,000 4,258
Washington Health Care Fac. Auth. (Sisters of Providence) 6.00% 10/1/2000 (2) 3,030 3,085
Washington Health Care Fac. Auth. (Sisters of Providence) 6.00% 10/1/2001 (2) 4,735 4,877
-----------
92,321
-----------
WEST VIRGINIA (0.5%)
West Virginia Building Comm. Lottery Rev. 5.50% 7/1/2000 (1) 5,500 5,559
West Virginia Capital Appreciation Infrastructure 0.00% 11/1/2005 (3) 3,850 2,855
West Virginia Capital Appreciation Infrastructure 0.00% 11/1/2006 (3) 6,850 4,800
-----------
13,214
-----------
WISCONSIN (1.5%)
Milwaukee WI GO 6.00% 2/1/2005 9,300 9,808
Wisconsin GO 5.00% 5/1/2004 10,895 11,035
Wisconsin GO 6.00% 5/1/2003 14,055 14,703
Wisconsin Public Power System Rev. 7.30% 7/1/2000 (3)(Prere.) 4,000 4,168
-----------
39,714
-----------
WYOMING (0.2%)
Platte County WY PCR (Basin Electric Power Corp.) 4.40% 1/1/2000 3,945 3,948
-----------
- ---------------------------------------------------------------------------------------------------------------------------
TOTAL MUNICIPAL BONDS
(COST $2,571,889) 2,555,409
- ---------------------------------------------------------------------------------------------------------------------------
</TABLE>
25
<PAGE> 68
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
MARKET
VALUE*
LIMITED-TERM TAX-EXEMPT FUND (000)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C>
OTHER ASSETS AND LIABILITIES (0.8%)
- ---------------------------------------------------------------------------------------------------------------------------
Other Assets--Note B $ 64,386
Liabilities (42,800)
------------
21,586
- ---------------------------------------------------------------------------------------------------------------------------
NET ASSETS (100%)
- ---------------------------------------------------------------------------------------------------------------------------
Applicable to 243,407,964 outstanding $.001 par value shares
of beneficial interest (unlimited authorization) $2,576,995
===========================================================================================================================
NET ASSET VALUE PER SHARE $10.59
===========================================================================================================================
</TABLE>
*See Note A in Notes to Financial Statements.
For key to abbreviations and other references, see page 67.
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
AT OCTOBER 31, 1999, NET ASSETS CONSISTED OF:
- ---------------------------------------------------------------------------------------------------------------------------
AMOUNT PER
(000) SHARE
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Paid in Capital $2,595,190 $10.67
Undistributed Net Investment Income -- --
Accumulated Net Realized Losses--Note E (1,715) (.01)
Unrealized Depreciation--Note F (16,480) (.07)
- ---------------------------------------------------------------------------------------------------------------------------
NET ASSETS $2,576,995 $10.59
===========================================================================================================================
</TABLE>
26
<PAGE> 69
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
FACE MARKET
MATURITY AMOUNT VALUE*
INTERMEDIATE-TERM TAX-EXEMPT FUND COUPON DATE (000) (000)
- ---------------------------------------------------------------------------------------------------------------------------
MUNICIPAL BONDS (98.8%)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
ALABAMA (0.5%)
Huntsville AL Health Care Auth. VRDO 3.50% 11/3/1999 (1) $ 19,700 $ 19,700
Huntsville AL Health Care Fac. Auth. PUT 4.65% 6/1/2005 (1) 22,000 21,472
Columbia Al Industrial Dev. Board PCR VRDO
(Alabama Power Co. Project) 3.50% 11/2/1999 1,000 1,000
Univ. of Southern Alabama Hosp. Rev. 7.00% 5/15/2000 (2) 3,250 3,304
-----------
45,476
-----------
ALASKA (0.2%)
Anchorage AK Electric Util. Rev. 8.00% 12/1/2011 (1) 5,395 6,617
Matanuska-Susitna Borough AK GO 5.50% 3/1/2012 (3) 6,000 5,984
Valdez AK Marine Terminal Rev. VRDO (Exxon Pipeline Co. Project) 3.50% 11/2/1999 8,300 8,300
-----------
20,901
-----------
ARIZONA (1.5%)
Arizona Transp. Board Excise Tax Rev. 6.00% 7/1/2005 (2) 18,885 19,968
Arizona Transp. Board Highway Rev. 8.75% 7/1/2003 10,000 11,371
Maricopa County AZ (Samaritan Health Service) 7.15% 12/1/2004 (1) 9,900 10,863
Maricopa County AZ (Samaritan Health Service) 7.15% 12/1/2005 (1) 6,080 6,606
Maricopa County AZ COP 6.00% 6/1/2004 5,275 5,421
Maricopa County AZ GO 6.25% 7/1/2002 (3) 5,100 5,330
Maricopa County AZ PCR VRDO (Arizona Public Service Palo Verde) 3.50% 11/2/1999 LOC 5,800 5,800
Maricopa County AZ Unified School Dist. 0.00% 1/1/2007 (3) 6,000 4,140
Mesa AZ GO 5.70% 7/1/2003 (1)(Prere.) 5,600 5,900
Phoenix Arizona General Obligation 7.50% 7/1/2008 5,000 5,834
Phoenix AZ Civic Improvement Corp. Airport Rev. 5.25% 7/1/2009 (4) 4,795 4,813
Phoenix AZ Civic Improvement Corp. Airport Rev. 5.25% 7/1/2010 (4) 2,500 2,488
Phoenix AZ Civic Improvement Corp. Airport Rev. 5.25% 7/1/2011 (4) 3,000 2,954
Phoenix AZ Civic Improvement Corp. Water System 5.95% 7/1/2006 (Prere.) 6,600 7,009
Phoenix AZ Highway Rev. GO 9.25% 7/1/2007 4,000 5,049
Tucson AZ Unified School Dist. 7.50% 7/1/2006 (3) 8,840 10,118
Tucson AZ Unified School Dist. 7.50% 7/1/2007 (3) 8,000 9,244
-----------
122,908
-----------
CALIFORNIA (8.4%)
Anaheim CA Public Finance Auth. Rev. 6.00% 9/1/2009 (4) 2,000 2,152
California Dept. of Veteran Affairs 5.45% 12/1/2019 (2) 14,370 14,021
California Dept. of Water (Central Valley Project) 8.25% 12/1/2003 5,000 5,713
California Dept. of Water (Central Valley Project) 8.25% 12/1/2004 5,545 6,475
California GO 5.50% 10/1/2006 (1) 20,525 21,559
California GO 5.70% 8/1/2004 (Prere.) 16,500 17,656
California GO 5.70% 8/1/2007 1,000 1,051
California GO 5.75% 8/1/2004 (3)(Prere.) 14,145 15,191
California GO 5.75% 8/1/2008 (3) 855 898
California GO 6.75% 6/1/2004 13,165 14,369
California GO 7.00% 10/1/2005 (1) 5,000 5,610
California GO 7.10% 6/1/2005 12,495 13,971
California GO 11.00% 3/1/2006 13,185 17,597
California Health Fac. Finance Auth. (Catholic Healthcare West) 6.25% 7/1/2004 (1) 4,515 4,834
California Health Fac. Finance Auth. (Catholic Healthcare West) 6.25% 7/1/2005 (1) 5,875 6,329
California Health Fac. Finance Auth. (Catholic Healthcare West) 6.25% 7/1/2006 (1) 5,000 5,415
California Health Fac. Finance Auth. (Catholic Healthcare West) 6.25% 7/1/2007 (1) 5,290 5,742
California Health Fac. Finance Auth. (Sisters of Providence) 6.00% 10/1/2002 3,865 4,034
California Health Fac. Finance Auth. (Sisters of Providence) 6.00% 10/1/2003 4,095 4,312
California Health Fac. Finance Auth. (Sisters of Providence) 6.00% 10/1/2004 4,340 4,599
California Public Works Board Lease Rev.
(Community College Project) 5.625% 3/1/2016 (2) 20,000 19,777
California Public Works Board Lease Rev. (Dept. of Corrections) 5.375% 11/1/2011 6,500 6,497
California Public Works Board Lease Rev. (Dept. of Corrections) 5.375% 11/1/2012 7,990 7,913
California Public Works Board Lease Rev. (Dept. of Corrections) 5.50% 1/1/2015 (2) 10,000 9,808
California Public Works Board Lease Rev. (Dept. of Corrections) 6.00% 1/1/2008 (2) 14,865 15,938
California Public Works Board Lease Rev. (State Archives) 5.375% 12/1/2009 4,555 4,638
California Public Works Board Lease Rev. (State Archives) 5.375% 12/1/2010 6,635 6,689
</TABLE>
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<CAPTION>
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FACE MARKET
MATURITY AMOUNT VALUE*
INTERMEDIATE-TERM TAX-EXEMPT FUND COUPON DATE (000) (000)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
California Public Works Board Lease Rev. (State Archives) 5.375% 12/1/2012 $ 7,895 $ 7,818
California Public Works Board Lease Rev. (Univ. of California) 6.10% 12/1/2005 (2) 6,515 6,935
California Public Works Board Lease Rev. (Univ. of California) 6.20% 12/1/2006 (2) 3,320 3,577
California Statewide Community Dev. Auth. PUT (Irvine Apartments) 4.90% 5/15/2008 65,000 61,225
California Statewide Community Dev. Auth. PUT (Irvine Apartments) 5.10% 5/17/2010 5,000 4,674
California Statewide Community Dev. Auth. TRAN (Riverside County) 4.00% 9/29/2000 30,000 30,104
Clovis CA Unified School Dist. GO 0.00% 8/1/2000 7,000 6,807
Clovis CA Unified School Dist. GO 0.00% 8/1/2001 11,180 10,395
Contra Costa CA COP (Merrithew Memorial Hosp. Project) 5.50% 11/1/2011 (1) 5,660 5,751
Fresno CA Sewer Rev. 6.25% 9/1/2014 (2) 12,000 12,866
Irvine CA Unified School Dist. GO 5.50% 11/1/2013 (2) 4,565 4,582
Los Angeles County CA School Pooled Financing Program TRAN 4.00% 9/29/2000 20,000 20,076
Los Angeles County CA Transp. Auth. Sales Tax Rev. 8.00% 7/1/2001 (2) 6,365 6,762
Los Angeles County CA Transp. Auth. Sales Tax Rev. 8.00% 7/1/2002 (2) 3,915 4,275
Los Angeles County CA Transp. Comm. Sales Tax Rev. 6.50% 7/1/2010 (4) 51,070 56,627
Metro. Water Dist. of Southern California 7.75% 7/1/2001 (Prere.) 9,380 10,125
Northern California Power Agency (Hydroelectric Project) 6.10% 7/1/2005 (1) 5,575 5,988
Northern California Power Agency (Hydroelectric Project) 6.20% 7/1/2006 (1) 5,940 6,445
Northern California Power Agency (Hydroelectric Project) 6.25% 7/1/2007 (1) 6,685 7,296
Oakland CA Redev. Agency (Central Dist. Project) 5.75% 2/1/2004 (2) 1,535 1,613
Orange County CA Local Transp. Auth. Sales Tax Rev. 5.50% 2/15/2009 (1) 5,000 5,176
Orange County CA Local Transp. Auth. Sales Tax Rev. 5.50% 2/15/2010 (1) 10,035 10,304
San Bernardino CA Medical Center COP 5.50% 8/1/2004 (1) 4,100 4,266
San Bernardino CA Medical Center COP 5.50% 8/1/2005 (1) 10,000 10,414
San Bernardino CA Medical Center COP 6.75% 8/1/2001 (Prere.) 11,385 12,134
San Bernardino CA Medical Center COP 7.00% 8/1/2008 (1) 9,045 10,335
San Bernardino CA Medical Center COP 7.00% 8/1/2009 (1) 9,705 11,123
San Bernardino CA Medical Center COP 7.00% 8/1/2010 (1) 10,525 12,126
San Diego County CA Regional Transp. Auth. Sales Tax Rev. 7.00% 4/1/2001 (Prere.) 3,220 3,416
San Diego County CA Regional Transp. Auth. Sales Tax Rev. 7.00% 4/1/2006 1,780 1,879
San Diego County CA Water Rev. COP 5.50% 5/1/2005 4,245 4,435
San Joaquin Hills CA Transp. Corridor Agency Toll Road Rev. 0.00% 1/15/2004 25,000 20,566
San Joaquin Hills CA Transp. Corridor Agency Toll Road Rev. 0.00% 1/15/2005 25,000 19,515
San Joaquin Hills CA Transp. Corridor Agency Toll Road Rev. 0.00% 1/15/2006 (1) 16,000 11,838
Santa Margarita/Dana Point CA Water Dist. Rev. 5.50% 8/1/2011 (2) 4,785 4,871
Santa Margarita/Dana Point CA Water Dist. Rev. 5.50% 8/1/2012 (2) 3,315 3,347
South Orange County CA Public Finance Auth. 7.00% 9/1/2006 (1) 500 564
Southern California Rapid Transit Dist. Rev. 5.70% 9/1/2004 (2) 14,040 14,814
Univ. of California Rev. (Multiple Purpose Project) 9.25% 9/1/2005 (1) 5,000 6,165
Univ. of California Rev. (Multiple Purpose Project) 10.00% 9/1/2003 (2) 3,790 4,532
-----------
688,549
-----------
COLORADO (0.8%)
Colorado Health Fac. Auth. Rev.
(Sisters of Charity Health System Inc.) 5.25% 12/1/2009 (1) 2,965 2,956
Colorado Health Fac. Auth. Rev.
(Sisters of Charity Health System Inc.) 5.25% 12/1/2010 (1) 1,740 1,714
Colorado Health Fac. Auth. Rev.
(Sisters of Charity Health System Inc.) 5.25% 12/1/2011 (1) 3,415 3,334
Colorado Health Fac. Auth. Rev.
(Sisters of Charity Health System Inc.) 8.50% 5/15/2004 (1) 17,500 19,176
Denver CO City & County School Dist. 6.95% 12/15/1999 (3)(Prere.) 4,390 4,451
Denver CO City & County School Dist. 6.95% 12/15/2000 (3) 4,860 4,928
E-470 Public Highway Auth. CO Rev. 0.00% 9/1/2011 (1) 8,000 4,122
E-470 Public Highway Auth. CO Rev. 4.80% 9/1/2009 (1) 6,095 5,841
E-470 Public Highway Auth. CO Rev. 4.90% 9/1/2010 (1) 5,000 4,775
E-470 Public Highway Auth. CO Rev. 5.00% 9/1/2011 (1) 7,250 6,974
Northern CO Muni. Subdist. Water Conservancy Dist. Rev. 6.35% 12/1/2007 (2) 4,155 4,523
-----------
62,794
-----------
CONNECTICUT (1.6%)
Connecticut GO 5.00% 12/1/2010 3,500 3,444
Connecticut GO 5.30% 11/15/2006 16,940 17,379
Connecticut GO 5.40% 11/15/2007 10,510 10,782
Connecticut GO 6.00% 5/15/2003 5,000 5,246
Connecticut GO 6.00% 10/1/2004 5,660 6,005
Connecticut GO 7.00% 3/15/2003 5,000 5,385
</TABLE>
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<CAPTION>
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FACE MARKET
MATURITY AMOUNT VALUE*
COUPON DATE (000) (000)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Connecticut Special Tax Obligation Rev. (Transp. Infrastructure) 5.125% 9/1/2005 $ 11,575 $ 11,758
Connecticut Special Tax Obligation Rev. (Transp. Infrastructure) 5.25% 9/1/2006 42,550 43,274
Connecticut Special Tax Obligation Rev. (Transp. Infrastructure) 7.125% 6/1/2010 12,000 13,674
Connecticut Special Tax Obligation Rev. (Transp. Infrastructure) 7.75% 6/1/2000 11,300 11,554
-----------
128,501
-----------
DELAWARE (0.1%)
Delaware Transp. Auth. Rev. 5.80% 7/1/2002 (Prere.) 2,595 2,730
Delaware Transp. Auth. Rev. 5.80% 7/1/2008 4,950 5,106
-----------
7,836
-----------
DISTRICT OF COLUMBIA (1.8%)
District of Columbia GO 5.20% 6/1/2008 (2) 4,390 4,357
District of Columbia GO 5.25% 6/1/2008 (1) 10,000 9,959
District of Columbia GO 5.30% 6/1/2009 (2) 4,600 4,569
District of Columbia GO 5.375% 6/1/2011 (2) 5,255 5,155
District of Columbia GO 5.50% 6/1/2004 (4) 12,845 13,216
District of Columbia GO 5.50% 6/1/2006 (4) 6,205 6,339
District of Columbia GO 5.50% 6/1/2007 (4) 2,950 3,018
District of Columbia GO 5.50% 6/1/2008 (4) 5,000 5,092
District of Columbia GO 5.50% 6/1/2010 (2) 10,490 10,473
District of Columbia GO 5.50% 6/1/2013 (2) 5,750 5,594
District of Columbia GO 5.75% 6/1/2003 (2)(Prere.) 190 201
District of Columbia GO 5.75% 6/1/2007 (2) 4,860 4,969
District of Columbia GO 5.75% 6/1/2010 (1) 23,590 24,019
District of Columbia GO 5.80% 6/1/2004 (3)(ETM) 955 998
District of Columbia GO 6.00% 6/1/2004 (1)(Prere.) 8,890 9,490
District of Columbia GO 6.10% 6/1/2004 (1)(Prere.) 7,000 7,501
District of Columbia GO 6.30% 6/1/2002 (1)(Prere.) 15,120 16,058
District of Columbia GO 6.30% 6/1/2005 (1) 4,880 5,187
District of Columbia Hosp. Rev. (Medlantic Health Group) 6.00% 8/15/2007 (1) 2,985 3,174
District of Columbia Hosp. Rev. (Medlantic Health Group) 6.00% 8/15/2008 (1) 3,160 3,364
District of Columbia Hosp. Rev. (Medlantic Health Group) 6.00% 8/15/2010 (1) 2,555 2,711
District of Columbia Hosp. Rev. (Medlantic Health Group) 6.00% 8/15/2012 (1) 2,995 3,145
-----------
148,589
-----------
FLORIDA (3.8%)
Broward County FL School Board COP 5.75% 7/1/2003 (2) 9,000 9,355
Broward County FL School Board COP 5.75% 7/1/2004 (2) 9,515 9,941
Broward County FL School Board COP 5.75% 7/1/2005 (2) 5,445 5,707
Broward County FL School Dist. GO 5.40% 2/15/2005 5,000 5,160
Broward County FL School Dist. GO 5.50% 2/15/2006 10,080 10,401
Collier County FL Health Fac. Auth. Hosp. Rev. VRDO
(Cleveland Clinic Obligated Group) 3.65% 11/2/1999 6,100 6,100
Dade County FL Sales Tax Rev. 6.00% 10/1/2002 (2) 5,000 5,223
Dade County FL School Board COP 5.25% 8/1/2009 (2) 11,320 11,422
Dade County FL School Board COP 5.25% 8/1/2010 (2) 12,140 12,129
Dade County FL School Board COP 5.375% 5/1/2006 (2)(Prere.) 4,775 4,951
Dade County FL School Dist. GO 6.25% 2/15/2004 (1) 5,520 5,866
Florida Board of Educ. (Capital Outlay Rev.) 0.00% 6/1/2000 (Prere.) 15,000 5,121
Florida Board of Educ. (Capital Outlay Rev.) 5.25% 1/1/2009 15,065 15,217
Florida Board of Educ. (Capital Outlay Rev.) 5.25% 6/1/2005 4,815 4,936
Florida Board of Educ. (Capital Outlay Rev.) 5.25% 1/1/2010 15,775 15,785
Florida Board of Educ. (Capital Outlay Rev.) 5.50% 6/1/2004 5,095 5,276
Florida Board of Educ. (Capital Outlay Rev.) 6.50% 6/1/2005 5,000 5,422
Florida Board of Educ. (Lottery Rev.) 5.25% 7/1/2010 (3) 10,300 10,299
Florida Board of Educ. (Lottery Rev.) 5.25% 7/1/2011 (3) 10,840 10,737
Florida Board of Educ. (Lottery Rev.) 5.25% 7/1/2012 (3) 11,410 11,192
Florida Dept. of General Services Rev.
(Dept. of Environmental Protection Preservation-2000) 5.00% 7/1/2011 (2) 6,575 6,393
Florida Dept. of General Services Rev.
(Dept. of Environmental Protection Preservation-2000) 5.125% 7/1/2009 (2) 5,325 5,338
Florida Dept. of General Services Rev.
(Dept. of Environmental Protection Preservation-2000) 5.25% 7/1/2003 (3) 18,350 18,791
</TABLE>
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<TABLE>
<CAPTION>
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FACE MARKET
MATURITY AMOUNT VALUE*
INTERMEDIATE-TERM TAX-EXEMPT FUND COUPON DATE (000) (000)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Florida Dept. of General Services Rev.
(Dept. of Environmental Protection Preservation-2000) 5.625% 7/1/2008 (2) $ 5,000 $ 5,166
Florida GO 6.00% 6/1/2006 6,605 7,036
Florida Turnpike Auth. Rev. 5.25% 7/1/2009 (3) 6,000 6,081
Florida Turnpike Auth. Rev. 5.25% 7/1/2010 (3) 6,000 6,022
Florida Turnpike Auth. Rev. 5.25% 7/1/2011 (3) 7,185 7,147
Florida Turnpike Auth. Rev. 5.25% 7/1/2012 (3) 7,560 7,449
Florida Turnpike Auth. Rev. 5.25% 7/1/2013 (3) 7,755 7,563
Hillsborough County FL School Dist. GO 7.10% 8/15/2000 (Prere.) 23,665 24,721
Lakeland FL Electric & Water Rev. 6.30% 10/1/2003 (4) 6,465 6,864
Lee County FL School Board COP 6.00% 8/1/2005 (3) 4,175 4,435
Palm Beach County FL School Board 6.00% 8/1/2005 (2) 6,115 6,495
Palm Beach County FL School Board 6.00% 8/1/2006 (2) 6,480 6,904
Palm Beach County FL Solid Waste Auth. Rev. 5.25% 10/1/2003 (2) 7,760 7,947
Palm Beach County FL Solid Waste Auth. Rev. 5.25% 10/1/2003 (2)(ETM) 1,240 1,274
St. Lucie County FL PCR VRDO (Florida Power & Light Co.) 3.55% 11/2/1999 2,995 2,995
Tampa FL Health System Rev. (Catholic Healthcare East) 5.25% 11/15/2011 (1) 3,000 2,958
-----------
311,819
-----------
GEORGIA (2.8%)
Atlanta GA Water & Wastewater Rev. 5.50% 11/1/2010 (3) 10,000 10,157
Atlanta GA Water & Wastewater Rev. 5.50% 11/1/2011 (3) 10,000 10,096
Atlanta GA Water & Wastewater Rev. 5.50% 11/1/2012 (3) 5,000 5,005
DeKalb County GA GO 5.60% 1/1/2005 3,040 3,148
Fulton County GA School Dist. GO 6.375% 5/1/2010 15,000 16,414
Georgia GO 6.25% 4/1/2006 12,200 13,160
Georgia GO 6.30% 4/1/2002 3,820 3,989
Georgia GO 6.30% 3/1/2007 15,000 16,269
Georgia GO 6.50% 8/1/2001 3,230 3,355
Georgia GO 6.50% 12/1/2003 5,000 5,368
Georgia GO 6.50% 7/1/2005 5,000 5,438
Georgia GO 6.75% 8/1/2007 6,100 6,812
Georgia GO 6.75% 9/1/2010 8,000 9,024
Georgia GO 6.80% 8/1/2002 8,000 8,500
Georgia GO 7.00% 11/1/2004 5,000 5,522
Georgia GO 7.00% 11/1/2005 15,670 17,502
Georgia GO 7.00% 11/1/2006 16,780 18,912
Georgia GO 7.00% 11/1/2007 17,960 20,382
Georgia GO 7.10% 9/1/2009 3,400 3,925
Georgia GO 7.25% 9/1/2005 3,630 4,088
Georgia GO 7.25% 9/1/2006 7,860 8,946
Georgia GO 7.40% 8/1/2007 11,200 12,944
Georgia Muni. Electric Power Auth. Rev. 6.30% 1/1/2005 (1) 12,775 13,479
Monroe County GA PCR (Oglethorpe Power Corp.) 6.65% 1/1/2008 (1) 9,220 10,113
-----------
232,548
-----------
HAWAII (2.3%)
Hawaii Airport System Rev. 5.40% 7/1/2002 (1) 7,855 8,039
Hawaii Airport System Rev. 5.85% 7/1/2002 (1) 7,830 8,101
Hawaii Airport System Rev. 5.95% 7/1/2003 (1) 2,590 2,707
Hawaii Airport System Rev. 6.05% 7/1/2004 (1) 3,145 3,315
Hawaii Airport System Rev. 6.15% 7/1/2005 (1) 10,735 11,365
Hawaii Airport System Rev. 6.25% 7/1/2006 (1) 5,000 5,320
Hawaii GO 5.00% 2/1/2004 10,000 10,056
Hawaii GO 5.00% 2/1/2005 6,650 6,649
Hawaii GO 5.125% 2/1/2006 11,605 11,617
Hawaii GO 5.25% 4/1/2003 (1) 5,000 5,105
Hawaii GO 5.50% 7/1/2001 6,500 6,616
Hawaii GO 6.00% 11/1/2010 (4) 10,000 10,552
Hawaii GO 6.40% 3/1/2007 5,555 5,950
Honolulu HI City & County GO 5.125% 7/1/2010 19,415 19,015
Honolulu HI City & County GO 5.125% 7/1/2011 (3) 2,305 2,231
Honolulu HI City & County GO 5.125% 7/1/2011 (3) 5,000 4,840
Honolulu HI City & County GO 5.125% 7/1/2013 (3) 3,710 3,496
</TABLE>
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<CAPTION>
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FACE MARKET
MATURITY AMOUNT VALUE*
COUPON DATE (000) (000)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Honolulu HI City & County GO 5.50% 11/1/2008 (3) $ 7,130 $ 7,293
Honolulu HI City & County GO 5.75% 1/1/2006 10 10
Honolulu HI City & County GO 5.75% 1/1/2006 (ETM) 8,815 9,209
Honolulu HI City & County GO 6.00% 1/1/2008 5 5
Honolulu HI City & County GO 6.00% 1/1/2008 (ETM) 4,995 5,316
Honolulu HI City & County GO 6.30% 3/1/2002 (Prere.) 4,830 5,121
Honolulu HI City & County GO 8.00% 10/1/2009 26,940 32,195
Honolulu HI City & County GO 8.00% 10/1/2009 (ETM) 3,620 4,407
-----------
188,530
-----------
ILLINOIS (3.2%)
Chicago IL Metro. Sanitation Dist. 8.75% 1/1/2000 (Prere.) 2,980 3,004
Chicago IL Metro. Water Reclamation Dist. 5.85% 12/1/2003 6,355 6,644
Chicago IL Metro. Water Reclamation Dist. 5.90% 12/1/2006 4,450 4,700
Chicago IL Metro. Water Reclamation Dist. 6.00% 12/1/2008 9,900 10,504
Chicago IL Metro. Water Reclamation Dist. 6.05% 12/1/2009 3,000 3,193
Chicago IL Metro. Water Reclamation Dist. 6.10% 12/1/2006 5,300 5,616
Chicago IL Metro. Water Reclamation Dist. 6.25% 12/1/2005 (Prere.) 15,000 16,128
Chicago IL School Finance Auth. 5.20% 6/1/2005 (3) 3,000 3,035
Chicago IL School Finance Auth. 5.375% 6/1/2008 (3) 9,500 9,567
Chicago IL School Finance Auth. 6.00% 6/1/2001 (3) 8,305 8,513
Chicago IL School Finance Auth. 6.10% 6/1/2002 (3) 11,945 12,393
Chicago IL Water Rev. 5.50% 11/1/2003 (2) 5,000 5,150
Cook County IL GO 5.75% 11/15/2003 (3) 5,000 5,200
Cook County IL GO 5.80% 11/15/2004 10,000 10,457
Cook County IL GO 6.60% 11/1/2001 (2)(Prere.) 4,785 5,092
Cook County IL GO 6.75% 11/1/2001 (2)(Prere.) 3,000 3,201
Illinois Dev. Finance Auth. PCR PUT (Commonwealth Edison) 4.40% 12/1/2006 (2) 45,400 43,076
Illinois GO 6.25% 10/1/2005 6,000 6,357
Illinois Health Fac. Auth. Rev. (Hosp. Sisters Services Inc.) 5.25% 6/1/2008 (1) 4,000 3,989
Illinois Health Fac. Auth. Rev. (Hosp. Sisters Services Inc.) 5.25% 6/1/2009 (1) 4,695 4,656
Illinois Health Fac. Auth. Rev. (Hosp. Sisters Services Inc.) 5.25% 6/1/2010 (1) 5,000 4,904
Illinois Health Fac. Auth. Rev. (Hosp. Sisters Services Inc.) 5.25% 6/1/2011 (1) 4,000 3,888
Illinois Health Fac. Auth. Rev. (Hosp. Sisters Services Inc.) 5.25% 6/1/2012 (1) 4,280 4,112
Illinois Metro. Pier & Exposition Auth. Rev. 6.50% 6/1/2006 (2) 11,885 12,868
Illinois Metro. Pier & Exposition Auth. Rev. 6.75% 6/1/2010 (2) 25,000 27,630
Illinois Metro. Pier & Exposition Auth. Rev. 7.25% 6/15/2005 (2) 12,895 14,335
Illinois Metro. Pier & Exposition Auth. Rev. 7.25% 6/15/2005 (2)(ETM) 2,105 2,358
Illinois Regional Transp. Auth. 9.00% 6/1/2005 (2) 5,220 6,241
Illinois Regional Transp. Auth. 9.00% 6/1/2008 (2) 6,840 8,594
Illinois Regional Transp. Auth. 9.00% 6/1/2009 (2) 4,255 5,419
Illinois Sales Tax Rev. 6.50% 6/15/2013 5,000 5,430
-----------
266,254
-----------
INDIANA (0.6%)
Hammond IN PCR VRDO (Amoco Co. Project) 3.50% 11/2/1999 1,885 1,885
Indiana Muni. Power Agency 5.875% 1/1/2010 (1) 4,500 4,676
Indiana Office Building Comm. Rev. 6.65% 7/1/2001 4,500 4,642
Indiana Office Building Comm. Rev. 6.70% 7/1/2002 5,290 5,480
Indiana Univ. Student Fee Bonds 7.00% 8/1/2000 (Prere.) 5,845 6,093
Indiana Univ. Student Fee Bonds 6.80% 8/1/2004 25,000 26,403
-----------
49,179
-----------
KENTUCKY (0.8%)
Kentucky Dev. Finance Auth. (St. Elizabeth Medical Center) 6.625% 11/1/2004 (3) 20,025 21,079
Kentucky Dev. Finance Auth. Hosp. Rev. (Sisters of Charity) 6.60% 11/1/2001 (Prere.) 5,000 5,317
Kentucky Econ. Dev. Finance Auth. Hosp. Fac. Rev. VRDO
(Baptist Healthcare) 3.55% 11/2/1999 (1) 2,900 2,900
Kentucky Property & Buildings Comm. Rev. 5.25% 11/1/2008 2,500 2,506
Kentucky Property & Buildings Comm. Rev. 5.50% 9/1/2003 8,000 8,238
Kentucky Property & Buildings Comm. Rev. 5.60% 9/1/2004 3,000 3,109
Kentucky Property & Buildings Comm. Rev. 5.70% 9/1/2005 7,350 7,600
Kentucky Property & Buildings Comm. Rev. 6.875% 8/1/2001 (Prere.) 10,400 11,061
-----------
61,810
-----------
</TABLE>
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<CAPTION>
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FACE MARKET
MATURITY AMOUNT VALUE*
INTERMEDIATE-TERM TAX-EXEMPT FUND COUPON DATE (000) (000)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
LOUISIANA (1.9%)
Jefferson Parish LA Sales Tax Rev. 6.75% 12/1/2002 (3)(Prere.) $ 3,400 $ 3,625
Jefferson Parish LA Sales Tax Rev. 6.75% 12/1/2006 (3) 7,600 8,047
Louisiana Gas & Fuel Tax Rev. 7.20% 11/15/1999 9,500 9,514
Louisiana Gas & Fuel Tax Rev. 7.25% 11/15/2000 5,250 5,363
Louisiana Gas & Fuel Tax Rev. 7.25% 11/15/2004 11,000 11,236
Louisiana GO 5.25% 4/15/2011 (4) 11,395 11,164
Louisiana GO 5.50% 4/15/2003 (3) 4,445 4,572
Louisiana GO 6.00% 4/15/2004 (3) 7,210 7,571
Louisiana GO 6.25% 4/15/2005 (3) 6,455 6,871
Louisiana GO 6.75% 5/15/2002 (1) 7,680 8,110
Louisiana GO 7.00% 9/1/2000 (Prere.) 11,540 12,059
Louisiana GO 7.00% 8/1/2004 (1) 5,810 6,352
Louisiana GO 7.75% 8/1/2006 (1) 10,970 12,646
Louisiana GO 8.75% 9/1/2000 (4) 8,830 9,180
Louisiana GO 8.75% 9/1/2000 (4)(Prere.) 9,445 10,002
Louisiana Public Fac. Auth. (Franciscan Missionaries) 5.375% 7/1/2011 (1) 4,990 4,903
St. Charles Parish LA Pollution Rev. (Entergy Inc.) 5.35% 10/1/2003 24,000 23,898
-----------
155,113
-----------
MAINE
Maine Muni. Bond Bank 4.90% 11/1/2002 2,500 2,533
-----------
MASSACHUSETTS (7.1%)
Boston MA GO 5.25% 4/1/2010 (3) 5,670 5,656
Boston MA GO 5.25% 4/1/2011 (3) 5,925 5,855
Boston MA GO 5.25% 4/1/2012 (3) 5,715 5,592
Boston MA Water & Sewer Comm. Rev. 5.75% 11/1/2013 5,785 5,923
Chelsea MA GO 5.50% 6/15/2008 (2) 5,735 5,865
Chelsea MA GO 5.50% 6/15/2009 (2) 5,400 5,501
Chelsea MA GO 5.50% 6/15/2011 (2) 5,000 5,012
Chelsea MA GO 5.50% 6/15/2012 (2) 5,000 4,973
Malden MA GO 5.00% 10/1/2015 (2) 2,120 1,919
Massachusetts Bay Transp. Auth. 5.125% 3/1/2011 3,355 3,261
Massachusetts Bay Transp. Auth. 5.125% 3/1/2012 5,820 5,591
Massachusetts Bay Transp. Auth. 5.125% 3/1/2013 5,000 4,734
Massachusetts Bay Transp. Auth. 7.25% 3/1/2003 (3) 16,000 16,488
Massachusetts Dev. Finance Agency Rev. VRDO (Brook's School) 3.45% 11/3/1999 (1) 800 800
Massachusetts GO 5.10% 2/1/2005 25,000 25,331
Massachusetts GO 5.125% 11/1/2013 11,000 10,458
Massachusetts GO 5.25% 4/1/2010 12,930 12,878
Massachusetts GO 5.25% 4/1/2011 13,525 13,342
Massachusetts GO 5.50% 7/1/2005 (2)(Prere.) 5,360 5,596
Massachusetts GO 5.50% 2/1/2011 17,575 17,645
Massachusetts GO 5.50% 2/1/2011 (1) 10,000 10,049
Massachusetts GO 5.70% 2/1/2008 (1) 6,805 7,046
Massachusetts GO 6.25% 7/1/2002 10,000 10,456
Massachusetts GO 6.50% 8/1/2002 (Prere.) 3,840 4,116
Massachusetts GO 6.90% 6/1/2000 (2) 2,500 2,541
Massachusetts GO 7.50% 6/1/2004 3,975 4,326
Massachusetts Grant Anticipation Notes 5.125% 6/15/2010 10,755 10,577
Massachusetts Grant Anticipation Notes 5.125% 12/15/2010 5,000 4,914
Massachusetts Grant Anticipation Notes 5.125% 6/15/2011 8,555 8,317
Massachusetts Grant Anticipation Notes 5.125% 12/15/2012 5,000 4,799
Massachusetts Grant Anticipation Notes 5.125% 6/15/2013 5,000 4,735
Massachusetts Grant Anticipation Notes 5.25% 6/15/2010 23,675 23,483
Massachusetts Grant Anticipation Notes 5.25% 12/15/2010 26,275 26,055
Massachusetts Grant Anticipation Notes 5.25% 6/15/2011 15,000 14,718
Massachusetts Grant Anticipation Notes 5.25% 12/15/2011 14,820 14,533
Massachusetts Health & Educ. Fac. Auth. Rev.
(Boston Medical Center) 5.25% 7/1/2009 (1) 4,215 4,193
Massachusetts Health & Educ. Fac. Auth. Rev.
(Boston Medical Center) 5.25% 7/1/2010 (1) 4,440 4,369
</TABLE>
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<CAPTION>
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FACE MARKET
MATURITY AMOUNT VALUE*
COUPON DATE (000) (000)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Massachusetts Health & Educ. Fac. Auth. Rev.
(Boston Medical Center) 5.25% 7/1/2011 (1) $ 4,670 $ 4,554
Massachusetts Health & Educ. Fac. Auth. Rev.
(Boston Medical Center) 5.25% 7/1/2012 (1) 1,850 1,784
Massachusetts Health & Educ. Fac. Auth. Rev. (Brandeis Univ.) 5.25% 10/1/2016 (1) 450 418
Massachusetts Health & Educ. Fac. Auth. Rev.
(Caritas Christi Obligated Group) 5.25% 7/1/2006 5,000 4,833
Massachusetts Health & Educ. Fac. Auth. Rev.
(Caritas Christi Obligated Group) 5.25% 7/1/2007 5,390 5,172
Massachusetts Health & Educ. Fac. Auth. Rev.
(Caritas Christi Obligated Group) 5.25% 7/1/2008 5,030 4,773
Massachusetts Health & Educ. Fac. Auth. Rev.
(Harvard Pilgrim Health) 5.25% 7/1/2009 (4) 6,375 6,341
Massachusetts Health & Educ. Fac. Auth. Rev.
(Harvard Pilgrim Health) 5.25% 7/1/2010 (4) 5,970 5,874
Massachusetts Health & Educ. Fac. Auth. Rev.
(Harvard Pilgrim Health) 5.25% 7/1/2011 (4) 3,530 3,443
Massachusetts Health & Educ. Fac. Auth. Rev.
(Harvard Pilgrim Health) 5.25% 7/1/2012 (4) 6,310 6,083
Massachusetts Health & Educ. Fac. Auth. Rev.
(Partners Healthcare System) 5.25% 7/1/2003 (4) 3,975 4,049
Massachusetts Health & Educ. Fac. Auth. Rev. VRDO (Harvard Univ.) 3.34% 11/4/1999 755 755
Massachusetts Ind. Finance Agency (Refusetech Inc. Project) 6.30% 7/1/2005 30,250 31,445
Massachusetts Ind. Finance Agency Resource Recovery Rev.
(Refusetech Inc. Project) 6.15% 7/1/2002 4,560 4,669
Massachusetts Ind. Finance Auth. Rev. (BioMed Research Corp.) 0.00% 8/1/2004 9,480 7,471
Massachusetts Turnpike Auth. Rev. 4.75% 1/1/2004 2,500 2,509
Massachusetts Water Pollution Abatement Trust 5.125% 8/1/2009 4,000 4,007
Massachusetts Water Pollution Abatement Trust 5.125% 8/1/2011 5,000 4,894
Massachusetts Water Pollution Abatement Trust 5.125% 8/1/2014 2,500 2,349
Massachusetts Water Pollution Abatement Trust 5.25% 8/1/2011 7,305 7,204
Massachusetts Water Pollution Abatement Trust 5.25% 8/1/2012 2,375 2,319
Massachusetts Water Pollution Abatement Trust 6.00% 8/1/2010 + 5,000 5,284
Massachusetts Water Pollution Abatement Trust 6.00% 8/1/2011 + 4,150 4,351
Massachusetts Water Pollution Abatement Trust 6.00% 8/1/2012 + 6,455 6,708
Massachusetts Water Pollution Abatement Trust 6.00% 8/1/2013 + 5,000 5,155
Massachusetts Water Resources Auth. Rev. 5.25% 3/1/2007 5,000 5,023
Massachusetts Water Resources Auth. Rev. 5.25% 3/1/2009 7,175 7,138
Massachusetts Water Resources Auth. Rev. 5.50% 11/1/2007 32,860 33,362
Massachusetts Water Resources Auth. Rev. 6.50% 7/15/2010 30,220 32,945
Massachusetts Water Resources Auth. Rev. 6.50% 7/15/2019 37,515 40,089
Massachusetts Water Resources Auth. Rev. 7.25% 4/1/2001 9,800 10,109
-----------
586,757
-----------
MICHIGAN (3.2%)
Detroit MI GO 5.80% 5/1/2002 (2) 8,970 9,254
Detroit MI GO 5.90% 5/1/2003 (2) 9,490 9,888
Detroit MI Sewer System Rev. 5.25% 7/1/2015 (1) 4,000 3,771
Greater Detroit MI Resource Recovery Auth. 5.50% 12/13/2004 (2) 7,505 7,761
Greater Detroit MI Resource Recovery Auth. 6.25% 12/13/2005 (2) 17,205 18,429
Greater Detroit MI Resource Recovery Auth. 6.25% 12/13/2006 (2) 22,475 24,154
Greater Detroit MI Resource Recovery Auth. 6.25% 12/13/2007 (2) 11,070 11,915
Greater Detroit MI Resource Recovery Auth. 6.25% 12/13/2008 (2) 5,625 6,054
Michigan Building Auth. Rev. 4.75% 10/15/2013 15,000 13,401
Michigan Building Auth. Rev. 5.25% 10/15/2010 3,485 3,459
Michigan Building Auth. Rev. 5.25% 10/15/2011 5,825 5,718
Michigan Building Auth. Rev. 5.25% 10/15/2013 2,500 2,397
Michigan Building Auth. Rev. 5.375% 10/15/2010 5,880 5,896
Michigan Building Auth. Rev. 6.00% 10/1/2001 (2)(Prere.) 8,735 9,024
Michigan Building Auth. Rev. 6.50% 10/1/2001 (2)(Prere.) 3,000 3,182
Michigan Hosp. Finance Auth. Rev.
(Genesys Regional Medical Center) 5.30% 10/1/2011 10,840 10,745
</TABLE>
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<CAPTION>
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FACE MARKET
MATURITY AMOUNT VALUE*
INTERMEDIATE-TERM TAX-EXEMPT FUND COUPON DATE (000) (000)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Michigan Hosp. Finance Auth. Rev.
(Genesys Regional Medical Center) 5.375% 10/1/2013 $ 4,000 $ 3,876
Michigan Hosp. Finance Auth. Rev.
(Genesys Regional Medical Center) 5.50% 10/1/2006 3,340 3,448
Michigan Hosp. Finance Auth. Rev.
(Genesys Regional Medical Center) 5.50% 10/1/2007 3,910 4,039
Michigan Muni. Bond Auth. Local Govt. Loan Auth. 0.00% 12/1/1999 (3) 6,000 5,979
Michigan Muni. Bond Auth. Local Govt. Loan Auth. 0.00% 12/1/2000 (3) 5,590 5,349
Michigan Muni. Bond Auth. Local Govt. Loan Auth. 0.00% 12/1/2001 (3) 9,630 8,779
Michigan Public Power Agency Rev. 5.30% 1/1/2005 13,075 13,340
Michigan Public Power Agency Rev. 5.375% 1/1/2006 13,790 14,054
Michigan Public Power Agency Rev. 5.50% 1/1/2007 14,545 14,839
Michigan Public Power Agency Rev. 5.50% 1/1/2008 9,360 9,506
Wayne Charter County MI Airport Rev. 5.25% 12/1/2010 (1) 12,000 11,753
Wayne Charter County MI Airport Rev. 5.25% 12/1/2011 (1) 10,845 10,524
Wayne Charter County MI Airport Rev. 5.25% 12/1/2012 (1) 15,770 15,121
-----------
265,655
-----------
MINNESOTA (0.7%)
Minnesota GO 5.00% 6/1/2010 8,485 8,375
Minnesota GO 5.00% 6/1/2011 8,675 8,473
Minnesota GO 5.00% 6/1/2012 3,255 3,143
Minnesota GO 5.125% 11/1/2009 8,275 8,306
Northern Minnesota Muni. Power Agency Electric System Rev. 5.25% 1/1/2012 (4) 6,000 5,878
Western Minnesota Muni. Power Agency 5.375% 1/1/2008 (2) 5,645 5,759
Western Minnesota Muni. Power Agency 5.50% 1/1/2010 (2) 14,045 14,256
-----------
54,190
-----------
MISSISSIPPI (0.6%)
Jackson County MS Port Facility Refunding Bonds PUT
(Chevron USA Inc. Project) 3.85% 11/2/1999 1,600 1,600
Mississippi GO 5.125% 12/1/2011 2,750 2,676
Mississippi GO 5.25% 5/1/2008 5,805 5,838
Mississippi GO 6.00% 12/1/2006 6,380 6,784
Mississippi GO 6.00% 11/1/2011 + 9,225 9,656
Mississippi GO 6.00% 11/1/2012 + 9,725 10,103
Mississippi GO 6.50% 5/1/2003 4,285 4,547
Mississippi GO 6.50% 9/1/2006 5,125 5,581
Mississippi GO 7.00% 5/1/2005 4,840 5,333
-----------
52,118
-----------
MISSOURI (0.2%)
Missouri Health & Educ. Fac. Auth. VRDO
(Sisters of Mercy Health Care System) 3.45% 11/3/1999 12,900 12,900
St. Louis County MO Rockwood School Dist. GO 8.50% 2/1/2002 5,940 6,450
-----------
19,350
-----------
MONTANA (0.3%)
Forsyth MT PCR PUT (Portland General Electric Co.) 4.60% 5/1/2003 10,000 9,920
Montana Health Fac. Auth. Rev. (Sisters of Charity Health System) 5.25% 12/1/2009 (1) 3,330 3,335
Montana Health Fac. Auth. Rev. (Sisters Of Charity Health System) 5.25% 12/1/2010 (1) 2,445 2,425
Montana Health Fac. Auth. Rev. (Sisters Of Charity Health System) 5.25% 12/1/2011 (1) 4,980 4,884
Montana Health Fac. Auth. Rev. (Sisters Of Charity Health System) 5.25% 12/1/2012 (1) 2,725 2,645
-----------
23,209
-----------
NEBRASKA (0.7%)
Nebraska Public Power Dist. Rev. 5.25% 1/1/2010 (1) 26,500 26,354
Nebraska Public Power Dist. Rev. 5.25% 1/1/2011 (1) 10,000 9,842
Nebraska Public Power Dist. Rev. 5.25% 1/1/2012 (1) 5,000 4,872
Nebraska Public Power Dist. Rev. 5.60% 7/1/2003 13,175 13,615
-----------
54,683
-----------
NEVADA (3.4%)
Clark County NV Airport System Rev. 5.25% 7/1/2012 (1) 4,225 4,092
Clark County NV Airport System Rev. 5.375% 7/1/2010 (1) 8,470 8,473
Clark County NV GO 5.50% 6/1/2012 (3) 6,365 6,336
Clark County NV GO 5.60% 6/1/2013 (3) 7,175 7,141
</TABLE>
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FACE MARKET
MATURITY AMOUNT VALUE*
COUPON DATE (000) (000)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Clark County NV GO 5.625% 6/1/2014 (3) $ 7,450 $ 7,351
Clark County NV GO 7.50% 6/1/2006 (2) 3,575 4,069
Clark County NV GO 7.50% 6/1/2007 (2) 9,550 10,971
Clark County NV GO 7.50% 6/1/2009 (2) 6,825 7,947
Clark County NV GO 8.00% 6/1/2008 (2) 9,875 11,747
Clark County NV Passenger Fac. Rev.
(McCarran International Airport) 5.375% 7/1/2010 (1) 6,435 6,447
Clark County NV Passanger Fac. Rev.
(McCarran International Airport) 5.375% 7/1/2011 (1) 9,445 9,375
Clark County NV Passanger Fac. Rev.
(McCarran International Airport) 5.375% 7/1/2012 (1) 8,295 8,149
Clark County NV School Dist. GO 5.375% 5/1/2006 (3) 3,740 3,812
Clark County NV School Dist. GO 5.375% 5/1/2007 (3) 9,195 9,328
Clark County NV School Dist. GO 5.375% 5/1/2008 (3) 9,170 9,259
Clark County NV School Dist. GO 5.50% 6/15/2010 (3) 16,325 16,469
Clark County NV School Dist. GO 5.60% 6/15/2009 (3) 9,640 10,104
Clark County NV School Dist. GO 5.625% 6/15/2013 (3) 10,000 9,957
Clark County NV School Dist. GO 5.70% 6/15/2009 (1) 10,825 11,399
Clark County NV School Dist. GO 5.875% 6/15/2005 (1)(Prere.) 23,760 25,223
Clark County NV School Dist. GO 5.90% 6/15/2006 (3)(Prere.) 10,000 10,649
Clark County NV School Dist. GO 6.50% 6/15/2006 (3) 13,865 15,033
Clark County NV School Dist. GO 7.25% 6/15/2002 (1) 3,995 4,264
Clark County NV School Dist. GO 9.75% 6/1/2000 (1) 4,580 4,733
Nevada GO 5.25% 5/15/2010 8,555 8,473
Nevada GO 5.25% 5/15/2011 16,455 16,106
Nevada GO 5.25% 5/15/2012 17,300 16,759
Nevada GO 6.00% 5/1/2005 10,450 10,775
Washoe County NV Hosp. Medical Center 6.00% 6/1/2009 (2) 6,310 6,581
-----------
281,022
-----------
NEW HAMPSHIRE (0.2%)
New Hampshire Business Finance Auth. PCR PUT
(United Illuminating) 4.55% 2/1/2004 15,000 14,520
-----------
NEW JERSEY (5.0%)
Camden County NJ Muni. Util. Auth. 0.00% 9/1/2000 (3) 18,500 17,875
Camden County NJ Muni. Util. Auth. 0.00% 9/1/2002 (3) 18,545 16,235
Camden County NJ Muni. Util. Auth. 0.00% 9/1/2003 (3) 18,545 15,417
Essex County NJ Solid Waste Util. Auth. 5.50% 4/1/2011 (4) 3,000 3,152
New Jersey Econ. Dev. Auth. 5.50% 5/1/2008 (4) 10,920 11,272
New Jersey Econ. Dev. Auth. Market Transition Fac. 5.70% 7/1/2005 (1) 6,330 6,606
New Jersey Econ. Dev. Auth. Market Transition Fac. 5.80% 7/1/2008 (1) 4,000 4,134
New Jersey Econ. Dev. Auth. Market Transition Fac. 7.00% 7/1/2003 (1) 26,195 28,249
New Jersey Econ. Dev. Auth. Rev. (Market Transition) 5.80% 7/1/2007 (1) 17,800 18,588
New Jersey Econ. Dev. Auth. Rev. (Market Transition) 5.875% 7/1/2011 (1) 6,000 6,178
New Jersey Econ. Dev. Auth. VRDO (Natural Gas Fac. NUI Corp.) 3.40% 11/2/1999 (2) 2,500 2,500
New Jersey GO 6.00% 7/15/2006 3,300 3,523
New Jersey Health Care Fac. Finance Auth. Rev.
(Saint Barnabas Health Care) 5.25% 7/1/2010 (1) 8,050 8,010
New Jersey Health Care Fac. Finance Auth. Rev.
(Saint Barnabas Health Care) 5.25% 7/1/2011 (1) 8,230 8,117
New Jersey Health Care Fac. Finance Auth. Rev.
(Saint Barnabas Health Care) 5.25% 7/1/2012 (1) 2,600 2,539
New Jersey Health Care Fac. Finance Auth. Rev.
(Saint Barnabas Health Care) 5.25% 7/1/2014 (1) 3,850 3,675
New Jersey Health Care Fac. Finance Auth. Rev.
(Union Hosp./Mega Care) 6.40% 7/1/2000 (ETM) 3,295 3,349
New Jersey Sports & Exposition Auth. 6.50% 3/1/2002 (Prere.) 1,340 1,427
New Jersey Sports & Exposition Auth. 6.50% 3/1/2006 3,955 4,185
New Jersey Sports & Exposition Auth. 6.50% 3/1/2007 2,930 3,101
New Jersey Transp. Corp. Grant Anticipation Notes 5.50% 9/1/2003 12,500 12,867
New Jersey Transp. Trust Fund Auth. 5.30% 12/15/2001 5,000 5,114
New Jersey Transp. Trust Fund Auth. 5.50% 6/15/2011 (1) 4,250 4,284
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FACE MARKET
MATURITY AMOUNT VALUE*
INTERMEDIATE-TERM TAX-EXEMPT FUND COUPON DATE (000) (000)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
New Jersey Transp. Trust Fund Auth. 6.00% 12/15/2004 (1) $ 4,000 $ 4,245
New Jersey Transp. Trust Fund Auth. 6.00% 6/15/2008 34,660 36,888
New Jersey Transp. Trust Fund Auth. 6.00% 6/15/2009 37,000 39,361
New Jersey Transp. Trust Fund Auth. 6.50% 6/15/2005 (2) 5,000 5,417
New Jersey Turnpike Auth. Rev. 4.75% 1/1/2006 (ETM) 15,115 15,140
New Jersey Turnpike Auth. Rev. 5.60% 1/1/2000 (2) 5,000 5,015
New Jersey Turnpike Auth. Rev. 5.90% 1/1/2003 (2) 4,700 4,887
New Jersey Turnpike Auth. Rev. 5.90% 1/1/2004 (2) 19,030 19,863
New Jersey Turnpike Auth. Rev. 6.00% 1/1/2005 (2) 22,220 23,205
New Jersey Turnpike Auth. Rev. 6.50% 1/1/2009 (2) 50,000 54,881
New Jersey Turnpike Auth. Rev. VRDO 3.40% 11/3/1999 (3)LOC 10,800 10,800
Rutgers State Univ. NJ GO 6.40% 5/1/2013 4,675 5,076
-----------
415,175
-----------
NEW YORK (14.8%)
Long Island NY Power Auth. Electric System Rev. 5.00% 4/1/2004 (1) 15,600 15,772
Long Island NY Power Auth. Electric System Rev. 5.00% 4/1/2006 (4) 24,755 24,794
Long Island NY Power Auth. Electric System Rev. 5.00% 4/1/2008 (1) 5,000 4,892
Long Island NY Power Auth. Electric System Rev. 5.125% 4/1/2012 (1) 25,195 24,133
Long Island NY Power Auth. Electric System Rev. 5.50% 12/1/2008 (2) 5,000 5,118
Long Island NY Power Auth. Electric System Rev. 5.50% 12/1/2010 (2) 15,000 15,198
Long Island NY Power Auth. Electric System Rev. 5.50% 12/1/2011 (2) 25,000 25,197
Long Island NY Power Auth. Electric System Rev. 5.50% 12/1/2012 (4) 22,500 22,499
Metro. Transp. Auth. NY 5.20% 7/1/2005 (2) 5,760 5,853
Metro. NY Transp. Auth. Dedicated Tax Fund 5.25% 4/1/2013 (3) 11,755 11,274
Metro. NY Transp. Auth. Dedicated Tax Fund 5.50% 4/1/2015 (1) 4,500 4,341
Metro. Transp. Auth. NY Commuter Fac. Rev. 5.00% 7/1/2011 (1) 16,625 15,901
Metro. Transp. Auth. NY Commuter Fac. Rev. 5.00% 7/1/2012 (2) 8,730 8,243
Metro. Transp. Auth. NY Commuter Fac. Rev. 5.00% 7/1/2013 (1) 18,000 16,748
Metro. Transp. Auth. NY Commuter Fac. Rev. 5.60% 7/1/2011 + 4,755 4,762
Metro. Transp. Auth. NY Commuter Fac. Rev. 5.625% 7/1/2012 + 4,805 4,777
Metro. Transp. Auth. NY Commuter Fac. Rev. 5.75% 7/1/2013 + 4,880 4,861
Metro. Transp. Auth. NY Commuter Fac. Rev. 5.875% 7/1/2014 + 5,000 4,992
Metro. Transp. Auth. NY Commuter Fac. Rev. 6.10% 7/1/2007 (1) 3,625 3,859
Metro. Transp. Auth. NY Commuter Fac. Rev. 6.10% 7/1/2008 (1) 7,200 7,661
Metro. Transp. Auth. NY Service Contract 5.50% 7/1/2012 (4) 5,000 4,950
Metro. Transp. Auth. NY Transp. Fac. Rev. 5.125% 7/1/2012 (4) 10,765 10,304
Metro. Transp. Auth. NY Transp. Fac. Rev. 5.125% 7/1/2013 (4) 16,455 15,520
Metro. Transp. Auth. NY Transp. Fac. Rev. 5.25% 7/1/2009 (4) 20,000 19,998
Metro. Transp. Auth. NY Transp. Fac. Rev. 5.25% 7/1/2010 (4) 2,575 2,550
Metro. Transp. Auth. NY Transp. Fac. Rev. 5.40% 7/1/2003 10,560 10,795
Metro. Transp. Auth. NY Transit Rev. 5.875% 7/1/2014 + 6,285 6,275
Muni. Assistance Corp. for New York City NY 5.20% 7/1/2007 (2) 4,500 4,548
Muni. Assistance Corp. for New York City NY 5.25% 7/1/2001 4,000 4,066
Muni. Assistance Corp. for New York City NY 5.50% 7/1/2001 4,500 4,592
Muni. Assistance Corp. for New York City NY 5.50% 7/1/2002 10,000 10,264
Muni. Assistance Corp. for New York City NY 6.00% 7/1/2004 4,200 4,428
Muni. Assistance Corp. for New York City NY 6.00% 7/1/2006 13,500 14,312
Muni. Assistance Corp. for New York City NY 6.00% 7/1/2008 10,000 10,602
Muni. Assistance Corp. for New York City NY 6.25% 7/1/2005 5,000 5,346
Nassau County NY GO 5.00% 6/1/2003 (2) 5,210 5,275
Nassau County NY GO 5.00% 6/1/2004 (2) 5,210 5,259
Nassau County NY GO 5.00% 6/1/2005 (2) 4,670 4,688
Nassau County NY GO 5.00% 9/1/2011 (3) 7,550 7,186
Nassau County NY GO 5.00% 9/1/2012 (3) 6,720 6,313
Nassau County NY GO 5.00% 9/1/2013 (3) 5,730 5,303
New York City NY GO 5.25% 8/15/2010 (1) 5,000 4,963
New York City NY GO 5.25% 8/1/2011 (1) 7,000 6,873
New York City NY GO 5.60% 8/1/2005 10,380 10,687
New York City NY GO 5.70% 8/1/2007 9,800 10,109
New York City NY GO 5.75% 2/15/2005 (Prere.) 1,245 1,310
New York City NY GO 5.75% 2/15/2007 7,705 7,957
New York City NY GO 5.875% 8/15/2012 (3) 7,000 7,166
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<CAPTION>
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FACE MARKET
MATURITY AMOUNT VALUE*
COUPON DATE (000) (000)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
New York City NY GO 5.90% 8/1/2009 $ 6,125 $ 6,344
New York City NY GO 5.90% 8/1/2010 4,750 4,883
New York City NY GO 6.00% 8/1/2011 5,600 5,753
New York City NY GO 6.00% 8/1/2012 4,000 4,081
New York City NY GO 6.10% 8/1/2002 4,000 4,152
New York City NY GO 6.15% 8/15/2000 2,980 3,029
New York City NY GO 6.15% 8/15/2000 (ETM) 190 193
New York City NY GO 6.375% 8/1/2004 3,985 4,190
New York City NY GO 7.00% 8/1/2000 15 15
New York City NY GO 7.00% 2/1/2002 (Prere.) 4,395 4,700
New York City NY GO 7.00% 2/1/2005 605 642
New York City NY GO 7.00% 8/1/2005 6,500 7,129
New York City NY GO 7.10% 8/15/2004 (Prere.) 10,000 11,103
New York City NY GO 8.00% 11/1/2000 (2) 2,175 2,220
New York City NY GO 8.00% 4/1/2006 (2) 5,955 6,919
New York City NY GO 8.00% 8/1/2001 (Prere.) 3,185 3,432
New York City NY GO 8.00% 8/15/2001 (Prere.) 3,090 3,334
New York City NY GO VRDO 3.50% 11/2/1999 LOC 4,100 4,100
New York City NY GO VRDO 3.55% 11/2/1999 LOC 1,865 1,865
New York City NY IDA (USTA National Tennis Center Project) 6.375% 11/15/2007 (4) 6,200 6,716
New York City NY IDA (USTA National Tennis Center Project) 6.40% 11/15/2008 (4) 4,105 4,451
New York City NY IDA (USTA National Tennis Center Project) 6.50% 11/15/2009 (4) 6,745 7,343
New York City NY IDA (USTA National Tennis Center Project) 6.50% 11/15/2010 (4) 3,500 3,786
New York City NY Muni. Water Finance Auth. Water &
Sewer System Rev. 5.30% 6/15/2006 27,665 28,053
New York City NY Transitional Finance Auth. Rev 5.25% 11/15/2012 5,000 4,857
New York City NY Transitional Finance Auth. Rev. 5.00% 11/15/2009 5,000 4,907
New York City NY Transitional Finance Auth. Rev. 5.00% 11/15/2010 6,375 6,185
New York City NY Transitional Finance Auth. Rev. 5.00% 11/15/2010 10,000 9,703
New York City NY Transitional Finance Auth. Rev. 5.125% 11/1/2010 7,570 7,436
New York City NY Transitional Finance Auth. Rev. 5.125% 11/1/2011 7,245 7,033
New York City NY Transitional Finance Auth. Rev. 5.125% 11/1/2012 7,000 6,714
New York City NY Transitional Finance Auth. Rev. 5.125% 11/1/2013 6,000 5,671
New York City NY Transitional Finance Auth. Rev. 5.25% 11/15/2011 12,585 12,354
New York City NY Transitional Finance Auth. Rev. 5.25% 5/1/2012 3,475 3,379
New York City NY Transitional Finance Auth. Rev. 5.50% 11/15/2008 2,000 2,050
New York City NY Transitional Finance Auth. Rev. 5.75% 8/15/2010 (3) 14,740 15,266
New York City NY Transitional Finance Auth. VRDO 3.50% 11/3/1999 6,000 6,000
New York State Dormitory Auth. Rev. (City Univ.) 5.50% 7/1/2016 16,000 15,391
New York State Dormitory Auth. Rev. (City Univ.) 6.25% 7/1/2003 4,250 4,446
New York State Dormitory Auth. Rev. (City Univ.) 6.25% 7/1/2004 6,570 6,984
New York State Dormitory Auth. Rev. (City Univ.) 6.35% 7/1/2004 2,500 2,639
New York State Dormitory Auth. Rev. (City Univ.) 6.45% 7/1/2005 1,500 1,594
New York State Dormitory Auth. Rev. (City Univ.) 7.00% 7/1/2001 (3) 8,090 8,446
New York State Dormitory Auth. Rev. (City Univ.) 7.00% 7/1/2001 (3)(ETM) 1,910 1,996
New York State Dormitory Auth. Rev. (Jewish Medical Center) 5.25% 7/1/2010 (1) 5,910 5,810
New York State Dormitory Auth. Rev. (Jewish Medical Center) 5.25% 7/1/2011 (1) 9,170 8,935
New York State Dormitory Auth. Rev. (Mental Health Services) 5.25% 2/15/2011 (1) 7,370 7,186
New York State Dormitory Auth. Rev. (New York Univ.) 6.375% 7/1/2007 (3) 27,000 28,346
New York State Dormitory Auth. Rev. (Second Hosp.) 5.00% 2/15/2010 (4) 4,500 4,321
New York State Dormitory Auth. Rev. (Second Hosp.) 5.10% 2/15/2011 (4) 6,285 6,012
New York State Dormitory Auth. Rev. (Second Hosp.) 5.10% 2/15/2011 (2) 6,000 5,739
New York State Dormitory Auth. Rev. (Second Hosp.) 5.10% 2/15/2011 (2) 4,040 3,864
New York State Dormitory Auth. Rev. (State Univ.) 5.80% 5/15/2005 5,400 5,625
New York State Dormitory Auth. Rev. (State Univ.) 5.90% 5/15/2006 2,000 2,095
New York State Dormitory Auth. Rev. (State Univ.) 6.00% 7/1/2003 (2) 4,000 4,194
New York State Dormitory Auth. Rev. (State Univ.) 6.00% 7/1/2004 (2) 4,000 4,216
New York State Dormitory Auth. Rev. (State Univ.) 6.10% 5/15/2004 (Prere.) 2,000 2,152
New York State Dormitory Auth. Rev. (State Univ.) 7.10% 5/15/2000 6,050 6,153
New York State Dormitory Auth. Rev. (Univ. of Rochester) 5.75% 7/1/2014 (1) 9,725 9,629
New York State Dormitory Auth. (Upstate Community Colleges) 5.25% 7/1/2010 (2) 3,920 3,882
New York State Dormitory Auth. (Upstate Community Colleges) 5.25% 7/1/2011 (2) 3,610 3,536
</TABLE>
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<CAPTION>
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FACE MARKET
MATURITY AMOUNT VALUE*
INTERMEDIATE-TERM TAX-EXEMPT FUND COUPON DATE (000) (000)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
New York State Environmental Fac. Corp.
(Clean Water & Drinking Revolving Funds) 5.25% 6/15/2010 $ 9,245 $ 9,155
New York State Environmental Fac. Corp.
(Clean Water & Drinking Revolving Funds) 5.25% 6/15/2011 9,885 9,682
New York State Environmental Fac. Corp.
(Clean Water & Drinking Revolving Funds) 5.25% 6/15/2012 6,350 6,156
New York State GO 6.00% 10/1/2003 4,800 5,041
New York State GO 6.00% 10/1/2004 9,195 9,706
New York State GO 7.80% 11/15/1999 5,000 5,009
New York State Local Govt. Assistance Corp. 5.00% 4/1/2011 (3) 11,000 10,529
New York State Local Govt. Assistance Corp. 5.00% 4/1/2012 (3) 10,000 9,451
New York State Local Govt. Assistance Corp. 5.00% 4/1/2013 (3) 5,000 4,657
New York State Local Govt. Assistance Corp. 5.125% 4/1/2010 (2) 31,400 30,791
New York State Local Govt. Assistance Corp. VRDO 3.25% 11/3/1999 LOC 34,515 34,515
New York State Medical Care Fac. Finance Agency Rev. 5.375% 2/15/2014 (4) 4,460 4,244
New York State Medical Care Fac. Finance Agency Rev. 6.00% 8/15/2002 (1) 5,350 5,551
New York State Thruway Auth. (Highway & Bridge Trust Fund) 5.25% 4/1/2009 (3) 4,510 4,523
New York State Thruway Auth. (Highway & Bridge Trust Fund) 5.25% 4/1/2010 (3) 9,800 9,745
New York State Thruway Auth. (Highway & Bridge Trust Fund) 5.25% 4/1/2011 (3) 11,615 11,429
New York State Thruway Auth. (Highway & Bridge Trust Fund) 5.25% 4/1/2011 (2) 5,000 4,920
New York State Thruway Auth. (Highway & Bridge Trust Fund) 5.25% 4/1/2012 (3) 6,220 6,059
New York State Thruway Auth. (Highway & Bridge Trust Fund) 5.25% 4/1/2013 (3) 5,435 5,227
New York State Thruway Auth. (Highway & Bridge Trust Fund) 5.30% 4/1/2008 (1) 7,740 7,820
New York State Thruway Auth. (Highway & Bridge Trust Fund) 5.40% 4/1/2007 (1) 9,215 9,424
New York State Thruway Auth. (Highway & Bridge Trust Fund) 6.25% 4/1/2006 (3) 10,000 10,713
New York State Thruway Auth. Rev. (Service Contract) 5.375% 4/1/2009 (1) 16,500 16,663
New York State Thruway Auth. Rev. (Service Contract) 5.375% 4/1/2012 (1) 16,520 16,248
New York State Thruway Auth. Rev. (Service Contract) 5.75% 4/1/2004 (1)(Prere.) 14,000 14,849
New York State Urban Dev. Corp. Rev. (Correctional Fac.) 6.40% 1/1/2004 9,685 10,231
Onondaga County NY PCR (Anheuser-Busch Cos., Inc. Project) 6.625% 8/1/2006 10,000 10,670
Port Auth. of New York & New Jersey 5.50% 9/15/2008 (3) 5,810 5,953
Suffolk County NY Water Auth. 6.80% 6/1/2012 (ETM) 10,660 11,915
Triborough Bridge & Tunnel NY Auth. Rev. 0.00% 1/1/2003 19,185 16,449
Triborough Bridge & Tunnel NY Auth. Rev. 5.25% 1/1/2010 (4) 11,000 10,914
Triborough Bridge & Tunnel NY Auth. Rev. 5.50% 1/1/2006 (4) 1,000 1,029
Triborough Bridge & Tunnel NY Auth. Rev. 6.00% 1/1/2012 12,000 12,559
Triborough Bridge & Tunnel NY Auth. Rev. 6.60% 1/1/2010 55,325 60,947
-----------
1,218,467
-----------
NORTH CAROLINA (0.8%)
Cumberland County NC Hosp. Fac. Rev. (Cape Fear Hosp.) 5.25% 10/1/2019 10,000 8,735
North Carolina Muni. Power Agency (Catawba Electric) 6.00% 1/1/2004 (2) 7,000 7,300
North Carolina Muni. Power Agency (Catawba Electric) 6.00% 1/1/2005 (2) 28,750 30,057
North Carolina Muni. Power Agency (Catawba Electric) 7.00% 1/1/2000 (Prere.) 6,040 6,191
North Carolina Muni. Power Agency (Catawba Electric) 7.25% 1/1/2007 (1) 5,410 6,053
North Carolina Muni. Power Agency (Catawba Electric) 7.25% 1/1/2007 (2) 5,000 5,594
-----------
63,930
-----------
OHIO (2.8%)
Cleveland OH GO 5.50% 8/1/2008 (1) 6,295 6,461
Cleveland OH Water Works 5.25% 1/1/2009 (4) 10,110 10,175
Cleveland OH Water Works 5.25% 1/1/2010 (4) 7,000 6,988
Cleveland OH Water Works 5.25% 1/1/2011 (4) 5,745 5,687
Cleveland OH Water Works 5.25% 1/1/2012 (4) 10,695 10,496
Cleveland OH Water Works 6.00% 1/1/2002 (1) 11,190 11,563
Cleveland OH Water Works 6.00% 1/1/2003 (1) 2,105 2,196
Cleveland OH Water Works 6.00% 1/1/2004 (1) 6,855 7,199
Cleveland OH Water Works 6.00% 1/1/2005 (1) 4,545 4,794
Cleveland OH Water Works 6.00% 1/1/2006 (1) 2,100 2,223
Cleveland OH Water Works 6.25% 1/1/2005 (2) 4,910 5,165
Franklin County OH Hosp. Rev. 5.75% 5/15/2012 (2) 5,000 5,023
Hamilton County OH Hosp. Fac. Rev. VRDO
(Health Alliance of Greater Cincinnati) 3.45% 11/3/1999 (1) 7,545 7,545
Lorain County OH Hosp. Rev. (Catholic Healthcare Partners) 5.625% 9/1/2013 (1) 3,000 2,964
</TABLE>
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<TABLE>
<CAPTION>
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FACE MARKET
MATURITY AMOUNT VALUE*
COUPON DATE (000) (000)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Ohio Building Auth. (Adult Correctional Building) 5.75% 4/1/2008 $ 5,375 $ 5,615
Ohio Building Auth. (Adult Correctional Building) 5.75% 4/1/2009 (2) 5,485 5,720
Ohio Building Auth. (Adult Correctional Building) 5.90% 10/1/2009 (1) 4,435 4,600
Ohio Building Auth. (Adult Correctional Building) 6.00% 10/1/2007 (2) 3,710 3,953
Ohio Building Auth. (Data Center) 5.70% 10/1/2004 2,895 3,021
Ohio Building Auth. (Data Center) 5.75% 10/1/2005 3,070 3,215
Ohio Building Auth. (Highway Safety Building) 5.375% 10/1/2009 (2) 4,605 4,678
Ohio Building Auth. (Highway Safety Building) 5.75% 10/1/2008 (2) 5,055 5,292
Ohio Building Auth. (Highway Safety Building) 6.00% 4/1/2007 (2) 4,640 4,927
Ohio Building Auth. (State Correctional Fac.) 5.70% 10/1/2003 3,305 3,437
Ohio Building Auth. (State Correctional Fac.) 5.70% 10/1/2004 2,725 2,843
Ohio Building Auth. (State Correctional Fac.) 5.80% 10/1/2006 4,360 4,583
Ohio Building Auth. (State Correctional Fac.) 5.90% 10/1/2007 2,500 2,642
Ohio Building Auth. (State Correctional Fac.) 6.50% 10/1/2002 3,790 4,001
Ohio Building Auth. (State Correctional Fac.) 6.50% 10/1/2002 (1) 5,350 5,649
Ohio Building Auth. (State Correctional Fac.) 6.50% 10/1/2003 (1) 5,710 6,100
Ohio Building Auth. (State Correctional Fac.) 6.50% 10/1/2003 5,500 5,809
Ohio Building Auth. (State Correctional Fac.) 6.50% 10/1/2004 2,500 2,641
Ohio Higher Educ. Fac. 5.90% 12/1/2005 8,175 8,489
Ohio Housing Finance Agency Mortgage Rev. 5.025% 3/1/2021 25,000 24,695
Ohio Public Fac. Comm. Higher Educ. Fac. 5.00% 12/1/2009 5,190 5,109
Ohio Public Fac. Comm. Higher Educ. Fac. 5.25% 5/1/2010 (2) 5,950 5,940
Ohio Public Fac. Comm. Higher Educ. Fac. 5.50% 12/1/2006 5,465 5,594
Ohio Turnpike Comm. Rev. 5.50% 2/15/2010 (1) 4,435 4,502
Ohio Water Dev. Auth. 6.00% 12/1/2004 (2)(Prere.) 2,520 2,661
Ohio Water Dev. Auth. 6.00% 12/1/2008 (2) 3,480 3,642
Ohio Water Dev. Auth. PCR 5.00% 6/1/2015 (1) 2,000 1,828
-----------
229,665
-----------
OKLAHOMA (1.5%)
Grand River Dam Auth. OK 5.70% 6/1/2005 (4) 20,000 20,902
Grand River Dam Auth. OK 5.75% 6/1/2006 (4) 19,350 20,299
Grand River Dam Auth. OK 6.25% 6/1/2011 (2) 7,600 8,185
Grand River Dam Auth. OK 8.00% 6/1/2002 21,000 22,771
Oklahoma Dev. Finance Auth. Rev. (Hillcrest Hosp.) 5.125% 8/15/2010 2,955 2,637
Oklahoma Dev. Finance Auth. Rev. (Hillcrest Hosp.) 5.20% 8/15/2011 3,000 2,652
Oklahoma Dev. Finance Auth. Rev. (Hillcrest Hosp.) 5.625% 8/15/2019 14,445 12,402
Oklahoma Dev. Finance Auth. Rev. (Hillcrest Hosp.) 5.75% 8/15/2012 3,000 2,748
Oklahoma Dev. Finance Auth. Rev. (Hillcrest Hosp.) 5.75% 8/15/2013 2,000 1,811
Oklahoma Dev. Finance Auth. Rev. (Hillcrest Hosp.) 5.75% 8/15/2014 5,805 5,212
Oklahoma Dev. Finance Auth. Rev. (Hillcrest Hosp.) 5.75% 8/15/2015 2,000 1,779
Oklahoma Turnpike Auth. 5.00% 1/1/2007 4,775 4,798
Tulsa County OK Ind. Dev. PUT (St. Francis Hosp.) 5.15% 12/15/2003 8,715 8,802
Tulsa OK Metro. Util. Auth. Rev. 7.00% 2/1/2003 6,720 6,954
-----------
121,952
-----------
OREGON (0.7%)
Clackamas County OR Hosp. Fac. Auth. Rev. (Legacy Health System) 5.50% 2/15/2009 7,715 7,815
Clackamas County OR Hosp. Fac. Auth. Rev. (Legacy Health System) 5.50% 2/15/2010 9,955 10,009
Port Auth. of Portland OR Airport Rev.
(Portland International Airport) 5.00% 7/1/2013 (3) 2,520 2,307
Portland OR Sewer System Rev. 5.00% 6/1/2010 (3) 18,980 18,597
Portland OR Sewer System Rev. 5.00% 6/1/2012 (3) 13,580 13,004
Portland OR Sewer System Rev. 6.00% 6/1/2007 (3) 5,600 5,968
-----------
57,700
-----------
PENNSYLVANIA (8.9%)
Beaver County PA IDA PCR (Ohio Edison Project) 4.65% 6/1/2004 35,000 33,765
Berks County PA GO 7.25% 11/15/2000 (3)(Prere.) 10,000 10,535
Delaware County PA IDA Resource Recovery Rev. (American Fuel) 6.10% 1/1/2004 5,000 4,893
Delaware County PA IDA Resource Recovery Rev. (Browning Ferris) 6.00% 1/1/2009 5,355 5,069
Delaware County PA IDA Resource Recovery Rev. (Browning Ferris) 6.10% 1/1/2007 7,955 7,677
Delaware County PA IDA Resource Recovery Rev. (Browning Ferris) 6.10% 7/1/2013 9,750 9,053
Erie County PA Prison Auth. Lease Rev. 6.75% 11/1/2001 (1)(Prere.) 5,295 5,553
Montgomery County PA IDA PCR (PECO Energy) 5.20% 10/1/2004 24,500 24,373
Northumberland County PA Commonwealth Lease Rev. 6.70% 10/15/2001 (1)(Prere.) 7,005 7,333
</TABLE>
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<TABLE>
<CAPTION>
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FACE MARKET
MATURITY AMOUNT VALUE*
INTERMEDIATE-TERM TAX-EXEMPT FUND COUPON DATE (000) (000)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Northumberland County PA Commonwealth Lease Rev. 7.75% 10/15/2001 (1)(Prere.) $ 6,000 $ 6,396
Pennsbury PA School Dist. GO 5.50% 8/15/2014 (3) 6,000 5,840
Pennsylvania Convention Center Auth. 6.25% 9/1/2004 15,200 15,666
Pennsylvania Convention Center Auth. 6.70% 9/1/2014 (1) 4,000 4,339
Pennsylvania Convention Center Auth. 6.70% 9/1/2016 (3)(ETM) 3,000 3,336
Pennsylvania COP 4.80% 7/1/2001 (2) 20,000 20,088
Pennsylvania COP 4.90% 7/1/2002 (2) 13,665 13,735
Pennsylvania COP 5.00% 7/1/2003 (2) 4,555 4,580
Pennsylvania GO 5.00% 6/1/2003 (1) 13,870 14,065
Pennsylvania GO 5.00% 4/15/2005 24,290 24,497
Pennsylvania GO 5.00% 6/1/2005 (1) 6,070 6,129
Pennsylvania GO 5.00% 6/1/2006 (1) 14,200 14,279
Pennsylvania GO 5.00% 4/15/2007 7,950 7,940
Pennsylvania GO 5.00% 4/15/2008 9,250 9,174
Pennsylvania GO 5.00% 3/1/2011 11,525 11,090
Pennsylvania GO 5.125% 9/15/2009 (2) 20,000 19,930
Pennsylvania GO 5.375% 5/15/2013 (3) 3,515 3,441
Pennsylvania GO 5.50% 5/1/2013 (3) 8,025 7,965
Pennsylvania GO 5.90% 11/15/2001 1,500 1,549
Pennsylvania GO 6.20% 11/15/2001 (Prere.) 12,480 13,138
Pennsylvania GO 6.50% 11/1/2001 (Prere.) 4,260 4,506
Pennsylvania GO 10.00% 4/15/2002 (2) 10,160 11,438
Pennsylvania Higher Educ. Fac. Auth. Rev.
(Allegheny/Delaware Valley) 5.00% 11/15/2003 (1) 7,380 7,319
Pennsylvania Higher Educ. Fac. Auth. Rev.
(Allegheny/Delaware Valley) 5.00% 11/15/2004 (1) 9,295 9,161
Pennsylvania Higher Educ. Fac. Auth. Rev.
(Allegheny/Delaware Valley) 5.00% 11/15/2005 (1) 7,690 7,548
Pennsylvania Higher Educ. Fac. Auth. Rev.
(Allegheny/Delaware Valley) 5.00% 11/15/2006 (1) 3,250 3,182
Pennsylvania Higher Educ. Fac. Auth. Rev.
(Univ. of Pittsburgh Medical Center) 5.25% 8/1/2010 (4) 10,570 10,315
Pennsylvania Higher Educ. Fac. Auth. Rev.
(Univ. of Pittsburgh Medical Center) 5.25% 8/1/2011 (4) 11,195 10,794
Pennsylvania Higher Educ. Fac. Auth. Rev.
(Univ. of Pittsburgh Medical Center) 5.25% 8/1/2012 (4) 2,750 2,619
Pennsylvania Higher Educ. Fac. Auth. Rev.
(Univ. of Pittsburgh Medical Center) 5.25% 8/1/2013 (4) 4,000 3,757
Pennsylvania Housing Finance Agency Single Family Mortgage Rev. 5.40% 10/1/2024 7,250 7,240
Pennsylvania IDA 6.70% 7/1/2000 9,080 9,249
Pennsylvania IDA 6.80% 1/1/2001 5,000 5,148
Pennsylvania IDA 6.80% 7/1/2001 5,480 5,706
Pennsylvania Intergovernmental Cooperation Auth. Rev. 5.25% 6/15/2010 (3) 14,870 14,726
Pennsylvania Intergovernmental Cooperation Auth. Rev. 5.25% 6/15/2011 (3) 10,000 9,795
Pennsylvania Intergovernmental Cooperation Auth. Rev. 5.25% 6/15/2012 (3) 8,660 8,395
Pennsylvania Intergovernmental Cooperation Auth. Rev. 5.25% 6/15/2013 (3) 5,000 4,784
Pennsylvania Intergovernmental Cooperation Auth. Rev. 5.45% 6/15/2008 (3) 18,095 18,664
Pennsylvania Intergovernmental Cooperation Auth. Rev. 6.00% 6/15/2002 (3) 28,500 29,582
Pennsylvania Turnpike Comm. Oil Franchise Tax Rev. 5.25% 12/1/2009 (2) 5,000 5,015
Pennsylvania Turnpike Comm. Oil Franchise Tax Rev. 5.25% 12/1/2010 (2) 6,025 5,990
Pennsylvania Turnpike Comm. Oil Franchise Tax Rev. 5.25% 12/1/2011 (2) 11,000 10,816
Pennsylvania Turnpike Comm. Oil Franchise Tax Rev. 5.25% 12/1/2012 (2) 5,000 4,866
Philadelphia PA Airport Rev. (Philadelphia Airport Systems) 5.75% 6/15/2011 (3) 4,695 4,789
Philadelphia PA Airport Rev. (Philadelphia Airport Systems) 6.00% 6/15/2003 (3) 5,530 5,784
Philadelphia PA Gas Works Rev. 5.25% 7/1/2010 (4) 10,180 10,073
Philadelphia PA Gas Works Rev. 5.25% 7/1/2011 (4) 5,000 4,893
Philadelphia PA Gas Works Rev 5.50% 7/1/2009 (4) 10,820 10,998
Philadelphia PA GO 5.00% 3/15/2009 (4) 3,270 3,203
Philadelphia PA GO 5.125% 5/15/2009 (3) 2,000 1,978
Philadelphia PA GO 5.125% 5/15/2010 (3) 11,695 11,448
Philadelphia PA GO 5.125% 5/15/2011 (3) 12,290 11,889
Philadelphia PA GO 5.125% 5/15/2012 (3) 6,975 6,667
</TABLE>
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<TABLE>
<CAPTION>
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FACE MARKET
MATURITY AMOUNT VALUE*
INTERMEDIATE-TERM TAX-EXEMPT FUND COUPON DATE (000) (000)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Philadelphia PA GO 5.125% 5/15/2013 (3) $ 5,000 $ 4,709
Philadelphia PA GO 5.25% 3/15/2010 (4) 1,755 1,736
Philadelphia PA GO 5.25% 3/15/2011 (4) 3,610 3,531
Philadelphia PA GO 5.25% 3/15/2012 (4) 3,000 2,904
Philadelphia PA GO 6.00% 11/15/2000 (3) 11,995 12,247
Philadelphia PA Hosp. & Higher Educ. Fac. Auth. Rev. VRDO
(Children's Hosp. Project) 3.60% 11/2/1999 2,500 2,500
Philadelphia PA Muni. Lease Rev. 6.00% 7/15/2003 4,470 4,518
Philadelphia PA Parking Auth. 5.25% 9/1/2010 (2) 4,875 4,823
Philadelphia PA School Dist. GO 0.00% 7/1/2000 (2) 15,500 15,085
Philadelphia PA School Dist. GO 5.25% 4/1/2011 (1) 3,920 3,841
Philadelphia PA School Dist. GO 5.375% 7/1/2005 (1) 7,500 7,682
Philadelphia PA School Dist. GO 6.25% 9/1/2005 (2) 5,000 5,341
Philadelphia PA School Dist. GO 6.25% 9/1/2006 (2) 2,000 2,144
Philadelphia PA School Dist. GO 6.25% 9/1/2008 (2) 4,000 4,297
Philadelphia PA School Dist. GO 6.25% 9/1/2009 (2) 2,080 2,236
Philadelphia PA Water & Waste Water Rev. 5.25% 8/1/2009 (2) 6,460 6,455
Philadelphia PA Water & Waste Water Rev. 5.50% 6/15/2003 (3) 3,000 3,088
Philadelphia PA Water & Waste Water Rev. 6.25% 8/1/2007 (1) 5,000 5,364
Pittsburgh PA GO 5.125% 3/1/2009 (3) 10,000 9,908
Pittsburgh PA GO 5.20% 3/1/2010 (3) 22,000 21,705
Pittsburgh PA Water & Sewer Auth. Rev. 5.60% 9/1/2005 (3)(Prere.) 6,000 6,238
Schuylkill PA Redev. Auth. 6.95% 6/1/2001 (3)(Prere.) 3,995 4,222
-----------
732,339
-----------
PUERTO RICO (0.9%)
Puerto Rico Electric Power Auth. Rev. 5.00% 7/1/2009 (1) 2,500 2,498
Puerto Rico Electric Power Auth. Rev. 5.00% 7/1/2009 (4) 10,280 10,271
Puerto Rico Electric Power Auth. Rev. 5.00% 7/1/2010 (1) 9,645 9,542
Puerto Rico Electric Power Auth. Rev. 5.00% 7/1/2010 (4) 7,000 6,925
Puerto Rico Electric Power Auth. Rev. 5.00% 7/1/2011 (1) 5,000 4,896
Puerto Rico Electric Power Auth. Rev. 5.00% 7/1/2011 (4) 7,500 7,344
Puerto Rico Electric Power Auth. Rev. 5.125% 7/1/2013 (4) 11,955 11,562
Puerto Rico Electric Power Auth. Rev. 5.25% 7/1/2009 (1) 7,235 7,366
Puerto Rico Govt. Dev. Bank VRDO 3.25% 11/3/1999 (1) 1,900 1,900
Puerto Rico Telephone Auth. Rev. 5.40% 1/1/2008 9,550 10,000
-----------
72,304
-----------
RHODE ISLAND (0.5%)
Rhode Island Consolidated Capital Dev. Loan GO 6.00% 8/1/2005 (1) 4,000 4,234
Rhode Island Consolidated Capital Dev. Loan GO 6.00% 8/1/2006 (1) 5,000 5,307
Rhode Island Depositors Econ. Protection Corp. 6.55% 8/1/2010 (1) 8,385 9,176
Rhode Island Depositors Econ. Protection Corp. 6.55% 8/1/2010 (1) (ETM) 18,465 20,328
-----------
39,045
-----------
SOUTH CAROLINA (0.2%)
Piedmont SC Muni. Power Agency Rev. 5.40% 1/1/2007 (1) 1,800 1,820
Piedmont SC Muni. Power Agency Rev. 5.40% 1/1/2007 (1)(ETM) 1,400 1,443
South Carolina Transp. Infrastructure Bank 5.00% 10/1/2010 (1) 10,215 9,946
-----------
13,209
-----------
SOUTH DAKOTA (0.1%)
South Dakota Building Auth. Lease Rev. 5.25% 12/1/2010 (2) 4,800 4,740
-----------
TENNESSEE (0.4%)
Knox County Health, Educ., and Housing Board Rev. 5.40% 4/1/2011 3,465 3,241
Knox County Health, Educ., and Housing Board Rev. 5.50% 4/1/2012 2,660 2,486
Knox County Health, Educ., and Housing Board Rev. 5.50% 4/1/2013 4,495 4,147
Knox County Health, Educ., and Housing Board Rev. 5.625% 4/1/2014 2,000 1,856
Knox County Health, Educ., and Housing Board Rev. 5.75% 4/1/2019 14,000 12,650
Shelby County TN GO 5.625% 4/1/2005 (Prere.) 1,245 1,304
Shelby County TN GO 5.625% 4/1/2012 3,755 3,788
Shelby County TN (Methodist Health Systems) 6.25% 8/1/2006 4,915 5,246
-----------
34,718
-----------
</TABLE>
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<TABLE>
<CAPTION>
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FACE MARKET
MATURITY AMOUNT VALUE*
INTERMEDIATE-TERM TAX-EXEMPT FUND COUPON DATE (000) (000)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
TEXAS (11.1%)
Anderson County TX Rev. (Coffield Prison Farm Project) 5.50% 3/15/2003 (2)(Prere.) $ 6,985 $ 7,202
Anderson County TX Rev. (Coffield Prison Farm Project) 5.50% 3/15/2003 (2)(Prere.) 5,715 5,893
Anderson County TX Rev. (Coffield Prison Farm Project) 5.50% 3/15/2003 (2)(Prere.) 5,590 5,764
Austin TX Combined Util. System Rev. 5.20% 11/15/2003 (1) 3,360 3,432
Austin TX Combined Util. System Rev. 5.30% 5/15/2004 (1) 5,770 5,903
Austin TX Combined Util. System Rev. 5.75% 11/15/2003 (4) 7,500 7,817
Austin TX Combined Util. System Rev. 6.00% 11/15/2006 (1) 4,000 4,240
Austin TX Combined Util. System Rev. 7.25% 11/15/2003 (ETM) 395 433
Austin TX Independent School Dist. 0.00% 8/1/2007 3,400 2,264
Austin TX Independent School Dist. 5.75% 8/1/2006 (Prere.) 3,470 3,646
Austin TX Independent School Dist. 5.75% 8/1/2012 1,530 1,550
Bell County TX Health Fac. Dev. Corp. (Scott & White Hosp.) 7.625% 9/1/2003 8,340 8,447
Birdville TX Independent School Dist. 5.75% 2/15/2003 4,990 5,168
Dallas TX Civic Center Refunding & Improvement 4.60% 8/15/2009 (1) 12,000 11,191
Dallas TX Civic Center Refunding & Improvement 4.70% 8/15/2010 (1) 11,000 10,180
Dallas TX Civic Center Refunding & Improvement 4.80% 8/15/2011 (1) 12,635 11,645
Dallas TX Civic Center Refunding & Improvement 4.90% 8/15/2012 (1) 13,240 12,232
Dallas TX Independent School Dist. 5.30% 8/15/2005 (Prere.) 3,780 3,882
Dallas TX Independent School Dist. 5.30% 8/15/2008 1,220 1,233
Dallas TX Independent School Dist. 5.40% 8/15/2005 (Prere.) 7,890 8,142
Dallas TX Independent School Dist. 5.40% 8/15/2009 2,550 2,580
Dallas TX Independent School Dist. 5.50% 8/15/2005 (Prere.) 18,300 18,977
Dallas TX Independent School Dist. 5.50% 8/15/2010 5,910 5,977
Dallas TX Independent School Dist. 5.60% 8/15/2003 (Prere.) 2,220 2,304
Dallas TX Independent School Dist. 5.60% 8/15/2004 5,780 5,956
Dallas TX Independent School Dist. 5.70% 8/15/2003 (Prere.) 2,410 2,510
Dallas TX Independent School Dist. 5.70% 8/15/2006 2,340 2,405
Grapevine-Colleyville Independent School Dist. 8.25% 6/15/2008 3,000 3,624
Harris County TX Health Fac. Dev. Corp. Hosp. Rev. (Christus Health) 5.25% 7/1/2004 9,000 9,059
Harris County TX Health Fac. Dev. Corp. Hosp. Rev. (Memorial Hosp.) 6.00% 6/1/2008 (1) 6,080 6,357
Harris County TX Health Fac. Dev. Corp. Hosp. Rev. (Memorial Hosp.) 6.00% 6/1/2010 (1) 1,500 1,568
Harris County TX IDA VRDO (Shell Oil Co. Project) 3.50% 11/2/1999 1,300 1,300
Harris County TX Toll Road 6.30% 8/15/2002 (3)(Prere.) 4,470 4,771
Harris County TX Toll Road 6.30% 8/15/2004 (3) 840 891
Houston TX Airport System Rev. 6.00% 7/1/2011 (3) 4,200 4,293
Houston TX Airport System Rev. 6.00% 7/1/2012 (3) 4,460 4,526
Houston TX GO 4.80% 3/1/2009 5,820 5,570
Houston TX GO 5.00% 3/1/2004 6,265 6,316
Houston TX GO 5.00% 3/1/2010 7,245 7,051
Houston TX GO 5.00% 3/1/2011 4,535 4,360
Houston TX GO 5.10% 3/1/2006 12,200 12,244
Houston TX GO 5.25% 3/1/2010 9,865 9,771
Houston TX GO 5.25% 3/1/2011 6,000 5,879
Houston TX GO 5.80% 3/1/2002 5,080 5,231
Houston TX GO 7.00% 3/1/2008 48,405 53,928
Houston TX Hotel Occupancy Tax Rev. 5.25% 7/1/2007 (4) 6,585 6,621
Houston TX Housing Finance Corp. TOB VRDO 3.57% 11/4/1999 (4) 8,975 8,975
Houston TX Water & Sewer System Rev. 0.00% 12/1/2000 (2) 6,130 5,864
Houston TX Water & Sewer System Rev. 5.375% 12/1/2010 (4) 5,000 4,998
Houston TX Water & Sewer System Rev. 5.75% 12/1/2015 (1) 3,315 3,311
Houston TX Water & Sewer System Rev. 7.00% 12/1/2001 (2) 3,220 3,393
Houston TX Water & Sewer System Rev. 7.00% 12/1/2002 (2) 4,125 4,418
Houston TX Water & Sewer System Rev. 7.00% 12/1/2003 (2) 3,100 3,368
Lower Colorado River Auth. TX Rev. 5.00% 1/1/2010 (4) 4,590 4,536
Lower Colorado River Auth. TX Rev. 5.00% 1/1/2012 (4) 2,520 2,440
Lower Colorado River Auth. TX Rev. 5.50% 8/15/2010 + 4,155 4,188
Lower Colorado River Auth. TX Rev. 5.75% 5/15/2011 + 11,200 11,421
Lower Colorado River Auth. TX Rev. 5.75% 5/15/2012 + 24,000 24,302
Lower Colorado River Auth. TX Rev. 5.875% 5/15/2014 + 10,000 10,090
Lower Colorado River Auth. TX Rev. 6.00% 5/15/2007 (4)+ 46,565 49,221
Lubbock TX Health Fac. Dev. Corp. Rev. (St. Joseph's Health System) 5.25% 7/1/2009 8,070 8,057
</TABLE>
42
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<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
FACE MARKET
MATURITY AMOUNT VALUE*
COUPON DATE (000) (000)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Lubbock TX Health Fac. Dev. Corp. Rev. (St. Joseph's Health System) 5.25% 7/1/2010 $ 9,355 $ 9,249
Lubbock TX Health Fac. Dev. Corp. Rev. (St. Joseph's Health System) 5.25% 7/1/2011 9,875 9,655
Lubbock TX Health Fac. Dev. Corp. Rev. (St. Joseph's Health System) 5.25% 7/1/2012 5,000 4,838
Lubbock TX Health Fac. Dev. Corp. Rev. (St. Joseph's Health System) 5.25% 7/1/2014 5,000 4,712
North Texas Health Fac. Dev. 5.75% 2/15/2010 (1) 4,115 4,204
San Antonio TX Electric & Gas Rev. 5.25% 2/1/2007 (Prere.) 1,335 1,368
San Antonio TX Electric & Gas Rev. 5.25% 2/1/2009 11,615 11,648
San Antonio TX Electric & Gas Rev. 5.25% 2/1/2010 13,775 13,688
San Antonio TX Electric & Gas Rev. 5.25% 2/1/2012 7,500 7,301
San Antonio TX Electric & Gas Rev. 5.25% 2/1/2013 6,000 5,767
San Antonio TX Electric & Gas Rev. 5.50% 2/1/2002 (Prere.) 1,845 1,906
San Antonio TX Electric & Gas Rev. 5.50% 2/1/2004 2,700 2,763
San Antonio TX Electric & Gas Rev. 5.60% 2/1/2007 (Prere.) 745 779
San Antonio TX Electric & Gas Rev. 5.80% 2/1/2006 7,655 7,975
San Antonio TX Electric & Gas Rev. 5.80% 2/1/2006 (ETM) 345 362
Tarrant County TX Health Resources 5.75% 2/15/2013 (1) 7,670 7,648
Tarrant County TX Water Control & Improvement Dist. 4.50% 3/1/2011 (3) 5,000 4,492
Texas GO 0.00% 10/1/2013 20,000 9,035
Texas GO 5.125% 10/1/2010 16,125 15,932
Texas GO 5.125% 10/1/2011 13,500 13,177
Texas GO 8.00% 10/1/2007 50,000 59,638
Texas Public Finance Auth. Building Rev. 6.60% 2/1/2000 (1) 5,000 5,034
Texas Public Finance Auth. Building Rev. 6.75% 2/1/2002 (1) 5,000 5,139
Texas Public Finance Auth. Building Rev. 6.80% 2/1/2003 (1) 5,000 5,143
Texas Public Finance Auth. Rev. 5.75% 10/1/2004 (Prere.) 13,625 14,252
Texas Public Finance Auth. Rev. GO 4.90% 10/1/2010 32,235 31,076
Texas TRAN 4.50% 8/31/2000 140,000 140,777
Texas Water Finance Assistance GO 5.00% 8/1/2008 5,000 4,968
Texas Water Finance Assistance GO 5.00% 8/1/2009 5,000 4,939
Texas Water Finance Assistance GO 5.25% 8/1/2010 6,565 6,554
Texas Water Finance Assistance GO 5.25% 8/1/2012 3,600 3,531
Tomball TX Hosp. Auth. Rev. 5.75% 7/1/2014 8,500 7,800
Tomball TX Hosp. Auth. Rev. 6.00% 7/1/2019 3,600 3,332
Univ. of Texas Permanent Univ. Fund 6.40% 7/1/2000 5,000 5,270
Univ. of Texas Refunding Finance System Rev. 7.00% 8/15/2007 14,050 14,922
-----------
911,789
-----------
UTAH (1.0%)
Intermountain Power Agency UT Power Supply Rev. 5.25% 7/1/2009 41,240 41,268
Intermountain Power Agency UT Power Supply Rev. 5.25% 7/1/2012 20,550 19,938
Jordon UT School Dist. 5.75% 6/15/2005 4,235 4,437
Salt Lake County UT Building Auth. Lease Rev. 5.90% 10/1/2006 (1) 4,000 4,187
Utah GO VRDO 3.35% 11/3/1999 11,700 11,700
-----------
81,530
-----------
VIRGINIA (0.7%)
Arlington County VA IDA Resource Recovery Rev.
(Alexandria/Arlington Waste) 5.375% 1/1/2012 (4) 3,000 2,887
Chesapeake Bay Bridge & Tunnel VA 5.40% 7/1/2005 (3) 6,090 6,275
Virginia Beach VA Refunding & Public Improvement 5.25% 8/1/2009 4,000 4,039
Virginia Beach VA Refunding & Public Improvement 5.25% 8/1/2010 9,690 9,697
Virginia Beach VA Refunding & Public Improvement 5.25% 8/1/2011 5,000 4,961
Virginia Beach VA Refunding & Public Improvement 5.25% 8/1/2012 3,000 2,951
Virginia Beach VA Refunding & Public Improvement 5.25% 8/1/2013 1,750 1,698
Virginia Housing Dev. Auth. 7.10% 1/1/2017 8,000 8,222
Virginia Public School Auth. 5.00% 8/1/2005 4,360 4,416
Virginia Public School Auth. 5.00% 8/1/2011 3,380 3,275
Virginia Public School Auth. 5.25% 8/1/2008 2,540 2,577
Virginia Public School Auth. 5.40% 6/1/2009 5,750 5,846
-----------
56,844
-----------
</TABLE>
43
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<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
FACE MARKET
MATURITY AMOUNT VALUE*
INTERMEDIATE-TERM TAX-EXEMPT FUND COUPON DATE (000) (000)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
WASHINGTON (2.3%)
King County WA GO 6.00% 12/1/2004 $ 5,000 $ 5,226
King County WA GO 6.10% 12/1/2005 5,000 5,242
King County WA School Dist. 5.50% 12/1/2016 (3) 5,635 5,400
Seattle WA GO 5.60% 1/15/2009 5,020 5,120
Seattle WA Power & Light Rev. 5.00% 7/1/2011 5,715 5,471
Seattle WA Power & Light Rev. 5.10% 5/1/2005 10,575 10,691
Seattle WA Water System Rev. 5.00% 12/1/2003 2,000 2,028
Seattle WA Water System Rev. 5.10% 12/1/2004 4,000 4,064
Spokane WA Regional Solid Waste Management System 6.50% 1/1/2008 3,500 3,723
Spokane WA Regional Solid Waste Management System 6.50% 1/1/2009 3,000 3,202
Tacoma WA Electric System Rev. 5.50% 1/1/2012 (2) 5,500 5,461
Tacoma WA Electric System Rev. 5.70% 1/1/2003 (2) 5,785 5,974
Tacoma WA Electric System Rev. 5.70% 1/1/2003 (2)(ETM) 1,060 1,108
Washington GO 5.00% 1/1/2010 4,705 4,577
Washington GO 5.00% 7/1/2011 12,870 12,352
Washington GO 5.00% 1/1/2013 4,925 4,613
Washington GO 5.50% 7/1/2002 5,000 5,132
Washington GO 5.60% 9/1/2004 5,000 5,190
Washington GO 5.75% 9/1/2008 4,000 4,168
Washington GO 5.75% 5/1/2009 5,000 5,105
Washington GO 6.00% 7/1/2003 5,200 5,447
Washington GO 6.00% 7/1/2004 3,115 3,282
Washington GO 6.10% 6/1/2006 9,495 10,100
Washington GO 6.25% 6/1/2009 11,465 12,337
Washington GO 6.25% 9/1/2009 21,550 22,211
Washington GO 6.25% 2/1/2011 6,680 7,159
Washington Health Care Fac. Auth. (Sisters of Providence) 6.00% 10/1/2002 (2) 5,105 5,305
Washington Health Care Fac. Auth. (Sisters of Providence) 6.00% 10/1/2003 (2) 5,270 5,514
Washington Health Care Fac. Auth. (Sisters of Providence) 6.00% 10/1/2004 (2) 5,515 5,802
Washington Health Care Fac. Auth. (Sisters of Providence) 6.00% 10/1/2005 (2) 4,830 5,087
Washington Health Care Fac. Auth. (Sisters of Providence) 6.00% 10/1/2006 (2) 6,055 6,387
-----------
192,478
-----------
WEST VIRGINIA (0.1%)
West Virginia Building Comm. Rev. 5.25% 7/1/2008 (1) 1,000 1,005
West Virginia School Building Auth. Rev. 5.30% 7/1/2009 (2) 8,000 8,060
-----------
9,065
-----------
WISCONSIN (0.2%)
Green Bay WI PCR (Procter & Gamble) 5.15% 5/1/2004 9,600 9,669
Wisconsin GO 5.00% 5/1/2008 6,395 6,347
Wisconsin GO 5.20% 5/1/2010 4,150 4,120
-----------
20,136
-----------
WYOMING (0.1%)
Lincoln County WY PCR VRDO (Exxon Project) 3.50% 11/2/1999 1,900 1,900
Lincoln County WY PCR VRDO (Exxon Project) 3.60% 11/2/1999 4,500 4,500
Platte County WY PCR (Basin Electric Power Corp.) 4.60% 1/1/2002 2,430 2,433
-----------
8,833
-----------
- ---------------------------------------------------------------------------------------------------------------------------
TOTAL MUNICIPAL BONDS
(COST $8,132,231) 8,128,763
- ---------------------------------------------------------------------------------------------------------------------------
</TABLE>
44
<PAGE> 87
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
MARKET
VALUE*
(000)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C>
OTHER ASSETS AND LIABILITIES (1.2%)
- ---------------------------------------------------------------------------------------------------------------------------
Other Assets--Note B $ 332,458
Liabilities (232,902)
-----------
99,556
- ---------------------------------------------------------------------------------------------------------------------------
NET ASSETS (100%)
- ---------------------------------------------------------------------------------------------------------------------------
Applicable to 643,307,654 outstanding $.001 par value shares
of beneficial interest (unlimited authorization) $8,228,319
===========================================================================================================================
NET ASSET VALUE PER SHARE $12.79
===========================================================================================================================
</TABLE>
*See Note A in Notes to Financial Statements.
For key to abbreviations and other references, see page 67.
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
AT OCTOBER 31, 1999, NET ASSETS CONSISTED OF:
- ---------------------------------------------------------------------------------------------------------------------------
AMOUNT PER
(000) SHARE
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Paid in Capital $8,270,454 $12.86
Undistributed Net Investment Income -- --
Overdistributed Net Realized Gains--Note E (38,667) (.06)
Unrealized Depreciation--Note F (3,468) (.01)
===========================================================================================================================
NET ASSETS $8,228,319 $12.79
===========================================================================================================================
</TABLE>
45
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<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------
FACE MARKET
MATURITY AMOUNT VALUE*
INSURED LONG-TERM TAX-EXEMPT FUND COUPON DATE (000) (000)
- ------------------------------------------------------------------------------------------------------------------------------
MUNICIPAL BONDS (101.8%)
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
ALABAMA (1.3%)
Birmingham AL Medical Center (Special Care Medical Center) 7.25% 7/1/2015 (1) $ 6,715 $ 6,731
Medical Clinic Board of Bessemer AL (Bessemer Carraway Hosp.) 7.25% 4/1/2015 (1) 5,000 5,156
Medical Clinic Board of Montgomery AL (Jackson Hosp.) 6.00% 3/1/2026 (2) 12,000 11,843
Mobile AL Water & Sewer Comm. 5.50% 1/1/2010 (3) 4,000 4,045
-----------
27,775
-----------
ALASKA (0.9%)
Anchorage AK Electric Rev. 8.00% 12/1/2009 (1) 2,565 3,092
Anchorage AK Electric Rev. 8.00% 12/1/2010 (1) 2,960 3,612
Anchorage AK Water GO 7.20% 6/1/2017 (2) 11,000 11,136
Valdez AK Marine Terminal Rev. VRDO (Exxon Pipeline Co. Project) 3.50% 11/2/1999 1,000 1,000
-----------
18,840
-----------
ARIZONA (0.6%)
Maricopa County AZ (Samaritan Health Service) 7.00% 12/1/2016 (1) 8,650 9,811
Maricopa County AZ PCR VRDO (Arizona Public Service Palo Verde) 3.60% 11/2/1999 LOC 3,000 3,000
-----------
12,811
-----------
ARKANSAS (0.4%)
North Little Rock AR Electric System Rev. 6.50% 7/1/2010 (1) 3,500 3,836
North Little Rock AR Electric System Rev. 6.50% 7/1/2015 (1) 4,500 4,850
-----------
8,686
-----------
CALIFORNIA (10.2%)
California Community College Financing Auth. TRAN 4.00% 7/28/2000 20,785 20,852
California Health Fac. Finance Auth. (Adventist Health Sytem) 6.75% 3/1/2011 (1) 12,000 12,574
California Health Fac. Finance Auth. (Pomona Valley Hosp.) 5.75% 7/1/2015 8,205 8,171
California Housing Finance Agency Multifamily Housing Rev. 8.625% 8/1/2015 (1) 2,165 2,202
California PCR Finance Auth. VRDO (Pacific Gas & Electric Co.) 3.55% 11/2/1999 300 300
California Statewide Community Dev. Auth. Rev. TRAN
(Riverside County) 4.00% 9/29/2000 21,000 21,073
Los Angeles CA Unified School Dist. GO 5.375% 7/1/2016 (3) 1,500 1,445
Modesto CA Irrigation Dist. Finance Auth. Rev. (Woodland Project) 6.50% 10/1/2022 (2) 20,225 21,659
MSR California Public Power Agency (San Juan Project) 6.125% 7/1/2013 (2) 7,000 7,472
MSR California Public Power Agency (San Juan Project) 6.75% 7/1/2020 (1) 13,000 14,359
MSR California Public Power Agency VRDO (San Juan Project) 3.50% 11/2/1999 (1) 1,000 1,000
Oakland CA Redev. Agency (Central Dist. Project) 5.50% 2/1/2014 (2) 6,300 6,269
Port of Oakland CA Rev. 5.40% 11/1/2017 (1) 25,575 24,507
Sacramento CA Muni. Util. Dist. 5.75% 8/15/2013 (1) 12,360 12,447
Sacramento CA Muni. Util. Dist. 6.50% 9/1/2013 (1) 8,895 9,821
San Jose CA Tax Redev. 6.00% 8/1/2010 (1) 8,105 8,695
San Jose CA Redev. Agency (Merged Area Redev. Project) 4.75% 8/1/2029 (2) 11,600 9,488
Santa Clara CA Redev. Agency (Bayshore North Project) 7.00% 7/1/2010 (2) 3,000 3,380
Santa Clara CA Valley Water Dist. COP 6.00% 2/1/2024 (3) 5,000 5,005
Santa Rosa CA Waste Water Rev. 6.00% 9/1/2015 (3) 5,000 5,176
South County CA Regional Waste Water Auth. (Gilroy) 5.50% 8/1/2022 (3) 8,000 8,284
South County CA Regional Waste Water Auth. (Morgan Hill) 5.50% 8/1/2022 (3) 7,000 6,609
Southern California Public Power Auth. (Palo Verde) 5.00% 7/1/2015 (2) 2,605 2,412
Ukiah CA Electric Rev. 6.25% 6/1/2018 (1) 6,330 6,681
-----------
219,881
-----------
COLORADO (3.7%)
Colorado Health Fac. Auth. (Sisters of Charity Health System Inc.) 6.00% 5/15/2001 (1) 4,525 4,646
E-470 Public Highway Auth. CO Rev. 0.00% 9/1/2004 (1) 13,750 10,832
E-470 Public Highway Auth. CO Rev. 0.00% 9/1/2005 (1) 17,200 12,818
E-470 Public Highway Auth. CO Rev. 0.00% 9/1/2007 (1) 12,250 8,129
E-470 Public Highway Auth. CO Rev. 0.00% 9/1/2008 (1) 14,355 8,963
E-470 Public Highway Auth. CO Rev. 0.00% 9/1/2009 (1) 16,500 9,693
E-470 Public Highway Auth. CO Rev. 0.00% 9/1/2015 (1) 5,795 2,244
Northern Colorado Water Conservation Dist. Rev. 6.50% 12/1/2012 (2) 20,575 22,352
-----------
79,677
-----------
</TABLE>
46
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<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------
FACE MARKET
MATURITY AMOUNT VALUE*
COUPON DATE (000) (000)
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
CONNECTICUT (0.1%)
Connecticut Special Obligation Transp. Infrastructure Rev. 5.625% 10/1/2014 (3) $ 3,000 $ 2,992
-----------
DELAWARE (0.7%)
Delaware Econ. Dev. Auth. (Delmarva Power & Light) 7.30% 9/1/2015 (3) 1,160 1,205
Delaware Health Fac. Auth. (Delaware Medical Center) 7.00% 10/1/2015 (1) 6,000 6,597
Dover DE Electric Rev. 5.75% 7/1/2015 (3) 5,225 5,214
Dover DE Electric Rev. 6.10% 7/1/2011 (3) 2,000 2,077
-----------
15,093
-----------
DISTRICT OF COLUMBIA (0.5%)
District of Columbia Rev. (Howard Univ.) 5.75% 10/1/2017 (1) 10,030 9,778
-----------
FLORIDA (8.7%)
Broward County FL Airport System Rev. 5.25% 10/1/2010 (1) 11,365 11,225
Broward County FL Airport System Rev. 5.25% 10/1/2011 (1) 13,275 12,976
Coral Springs FL Improvement Dist. Water & Sewer GO 6.00% 6/1/2010 (1) 3,000 3,159
Davie FL Water & Sewer Rev. 6.375% 10/1/2012 (2) 2,620 2,845
Hillsborough County FL School Board COP 5.50% 7/1/2018 (1) 14,945 14,387
Hillsborough County FL School Board COP 6.00% 7/1/2025 (1) 10,000 10,133
Jacksonville FL PCR VRDO (Florida Power & Light Co. Project) 3.55% 11/2/1999 1,300 1,300
Orange & Orlando County FL Expressway Auth. 8.25% 7/1/2013 (3) 9,695 12,227
Orange & Orlando County FL Expressway Auth. 8.25% 7/1/2015 (3) 8,360 10,544
Orange & Orlando County FL Expressway Auth. 8.25% 7/1/2016 (3) 12,295 15,569
Orange County FL Health Fac. Auth. (Adventist for Sunbelt Group) 6.25% 11/15/2010 (2) 4,000 4,233
Palm Beach County FL Criminal Justice Fac. Rev. 7.20% 6/1/2014 (3) 16,300 18,875
Palm Beach County FL Criminal Justice Fac. Rev. 7.20% 6/1/2015 (3) 4,000 4,614
Sarasota County FL Public Hosp. Rev. (Sarasota Memorial Hosp.) 5.75% 10/1/2017 (1) 28,850 28,311
Seacoast FL Util. Auth. Water & Sewer Rev. 5.50% 3/1/2019 (3) 2,000 1,931
St. Lucie County FL Util. System Rev. 6.00% 10/1/2020 (3)(ETM) 2,350 2,375
Tampa FL Util. Rev. 6.75% 10/1/2010 (2) 9,330 10,498
Tampa FL Util. Rev. 6.75% 10/1/2011 (2) 9,965 11,220
Tampa FL Util. Rev. 6.75% 10/1/2012 (2) 10,635 11,958
-----------
188,380
-----------
GEORGIA (5.1%)
Atlanta GA Water & Sewer Rev. 5.25% 1/1/2007 (3)(Prere.) 21,950 22,550
Atlanta GA Water & Wastewater Rev. 5.50% 11/1/2017 (3) 8,000 7,751
Atlanta GA Water & Wastewater Rev. 5.50% 11/1/2018 (3) 15,360 14,782
Atlanta GA Water & Wastewater Rev. 5.50% 11/1/2019 (3) 9,040 8,690
George L. Smith Georgia World Congress Center Auth. Rev.
(Domed Stadium Project) 5.50% 7/1/2020 (1)+ 24,740 22,771
George L. Smith Georgia World Congress Center Auth. Rev.
(Domed Stadium Project) 5.70% 7/1/2013 (1)+ 5,000 4,897
George L. Smith Georgia World Congress Center Auth. Rev.
(Domed Stadium Project) 5.75% 7/1/2014 (1)+ 5,000 4,895
George L. Smith Georgia World Congress Center Auth. Rev.
(Domed Stadium Project) 5.75% 7/1/2015 (1)+ 3,680 3,564
Henry County GA School Dist. GO 6.45% 8/1/2011 (1) 4,000 4,354
Muni. Electric Auth. of Georgia 5.375% 1/1/2019 6,500 6,005
Private Colleges & Univ. Auth. of Georgia (Mercer Univ. Project) 6.50% 11/1/2015 (1) 5,000 5,423
Rockdale County GA Water & Sewer Auth. Rev. 5.375% 7/1/2029 (1) 5,000 4,543
-----------
110,225
-----------
HAWAII (1.5%)
Hawaii Airport System Rev. 6.35% 7/1/2007 (1) 8,000 8,538
Hawaii Dept. of Budget & Finance (Hawaii Electric Co. Inc.) 5.65% 10/1/2027 (1) 9,750 9,044
Hawaii Highway Rev. 5.25% 7/1/2011 1,150 1,116
Hawaii Highway Rev. 5.25% 7/1/2012 1,500 1,438
Honolulu HI City & County GO 8.00% 10/1/2010 8,695 10,493
Honolulu HI City & County GO 8.00% 10/1/2010 (ETM) 2,305 2,825
-----------
33,454
-----------
</TABLE>
47
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<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------
FACE MARKET
MATURITY AMOUNT VALUE*
INSURED LONG-TERM TAX-EXEMPT FUND COUPON DATE (000) (000)
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
ILLINOIS (4.2%)
Chicago IL Board of Educ. GO 6.25% 1/1/2011 (1) $ 7,000 $ 7,439
Chicago IL GO (Emergency Telephone System) 5.50% 1/1/2019 (3) 10,000 9,532
Chicago IL Public Building Comm. 7.00% 1/1/2020 (1)(ETM) 21,500 24,320
Cook County IL GO 7.25% 11/1/2007 (1) 6,000 6,814
Illinois Dev. Finance Auth. PCR
(Illinois Power Co. Project) 7.40% 12/1/2024 (1) 14,000 15,503
Illinois Regional Transit Auth. GO (Cook, DuPage,
and Kane Counties) 7.20% 11/1/2020 (2) 24,000 27,539
-----------
91,147
-----------
INDIANA (0.7%)
Indiana Muni. Power Agency Rev. 6.125% 1/1/2013 (1)(ETM) 13,250 14,176
-----------
KANSAS (0.9%)
Kansas Dev. Finance Auth. Rev. (Sisters of Charity) 5.00% 12/1/2025 (1) 10,000 8,526
Kansas Health System Dev. Auth. (St. Luke Mission) 5.375% 11/15/2016 (1) 9,300 8,637
Kansas Health System Dev. Auth. (St. Luke Mission) 5.375% 11/15/2021 (1) 3,000 2,752
-----------
19,915
-----------
KENTUCKY (1.6%)
Jefferson County KY Health System Rev. (Jewish Hosp.) 5.75% 1/1/2026 (2) 7,700 7,427
Kentucky Dev. Finance Auth. Hosp. Fac. Rev.
(St. Elizabeth's Medical Center) 6.00% 11/1/2010 (3) 23,885 24,533
Kentucky Educ. Dev. Auth. Medical Center Rev. (Ashland Hosp.) 5.00% 2/1/2018 (4) 2,000 1,746
Kentucky Educ. Dev. Auth. Medical Center Rev. (Ashland Hosp.) 5.00% 2/1/2028 (4) 2,250 1,900
-----------
35,606
-----------
LOUISIANA (2.6%)
Jefferson Parish LA Sales Tax Rev. 5.00% 12/1/2022 (4) 7,500 6,477
Jefferson Parish LA Sales Tax Rev. 6.75% 12/1/2006 (3) 5,865 6,210
New Orleans LA GO 0.00% 9/1/2010 (2) 8,500 4,701
New Orleans LA GO 0.00% 9/1/2011 (2) 10,475 5,422
New Orleans LA GO 0.00% 9/1/2013 (2) 9,000 4,058
New Orleans LA GO 6.00% 9/1/2001 (2)(Prere.) 7,750 7,994
New Orleans LA GO 6.00% 9/1/2021 (2) 14,500 14,377
Ouachita Parish LA Hosp. Service (Glenwood Medical Center) 5.70% 5/15/2016 (4) 4,900 4,735
Ouachita Parish LA Hosp. Service (Glenwood Medical Center) 5.75% 5/15/2021 (4) 3,200 3,063
-----------
57,037
-----------
MAINE (0.4%)
Maine Health & Higher Educ. Fac. Auth.
(Eastern Maine Medical System) 6.375% 10/1/2001 (3) 8,000 8,464
-----------
MARYLAND (3.3%)
Maryland Health & Higher Educ. Fac. Auth. Rev.
(Medlantic\Helix) 5.25% 8/15/2038 (4) 62,055 54,177
Maryland Health & Higher Educ. Fac. Auth. Rev.
(Univ. of Maryland Medical System) 7.00% 7/1/2022 (3) 12,025 13,649
Maryland Health & Higher Educ. Fac. Auth. Rev.
(Upper Chesapeake Hosp.) 5.375% 1/1/2028 (4) 3,500 3,200
-----------
71,026
-----------
MASSACHUSETTS (3.6%)
Boston MA GO 6.50% 7/1/2002 (2)(Prere.) 4,750 5,084
Massachusetts Consolidated Loan GO 7.00% 7/1/2009 (3) 32,250 36,499
Massachusetts Health & Educ. Fac. Auth. Rev.
(Boston College) 6.75% 7/1/2001 (3)(Prere.) 6,385 6,765
Massachusetts Health & Educ. Fac. Auth. Rev.
(Boston College) 6.75% 7/1/2011 (3) 210 221
Massachusetts Health & Educ. Fac. Auth. Rev.
(Falmouth Hosp.) 5.50% 7/1/2008 (1) 1,425 1,442
Massachusetts Health & Educ. Fac. Auth. Rev.
(Lahey Clinic) 7.85% 7/1/2003 (1) 3,000 3,309
Massachusetts Health & Educ. Fac. Auth. Rev.
(Massachusetts General Hosp.) 6.25% 7/1/2012 (2) 19,150 20,628
Massachusetts Health & Educ. Fac. Auth. Rev. VRDO
(Harvard Univ.) 3.34% 11/4/1999 1,300 1,300
Massachusetts St. College Bldg Auth. Rev. 0.00% 5/1/2017 (1) 7,460 2,615
-----------
77,863
-----------
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<CAPTION>
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FACE MARKET
MATURITY AMOUNT VALUE*
COUPON DATE (000) (000)
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
MICHIGAN (3.4%)
Detroit MI Sewer System Rev. 5.00% 7/1/2027 $ 5,500 $ 4,696
Detroit MI Sewer System Rev. 5.45% 7/1/2007 (3) 6,850 7,083
Michigan Hosp. Finance Auth. Rev. (Mercy Health) 5.375% 8/15/2026 (2) 5,000 4,500
Michigan Strategic Fund (Detroit Edison) 7.00% 7/15/2008 (1) 18,375 20,721
Monroe County MI Econ. Dev. Corp. (Detroit Edison) 6.95% 9/1/2022 (3) 25,000 28,199
St. Clair MI Econ. Dev. Corp. (Detroit Edison) 6.40% 8/1/2024 (2) 8,000 8,262
-----------
73,461
-----------
MINNESOTA (0.5%)
Southern Minnesota Muni. Power Agency Supply System Rev. 5.50% 1/1/2015 (2) 6,120 5,942
Southern Minnesota Muni. Power Agency Supply System Rev. 5.50% 1/1/2015 (2)(Prere.) 3,880 3,825
-----------
9,767
-----------
MISSOURI (0.2%)
Missouri Health & Educ. Fac. Auth. (Lester Cox Medical Center) 5.25% 6/1/2015 (1) 5,000 4,657
-----------
MONTANA (0.2%)
Montana Health Fac. Auth. Rev. (Providence Services) 5.375% 12/1/2025 4,750 4,349
-----------
NEBRASKA (2.5%)
Nebraska Public Power Dist. Rev. 0.00% 1/1/2006 (1) 24,465 17,811
Nebraska Public Power Dist. Rev. 0.00% 1/1/2007 (1) 24,485 16,814
Nebraska Public Power Dist. Rev. 0.00% 1/1/2008 (1) 15,000 9,697
Nebraska Public Power Dist. Rev. 5.25% 1/1/2011 (1) 10,000 9,842
-----------
54,164
-----------
NEVADA (0.2%)
Clark County NV GO 6.50% 6/1/2017 (2) 5,000 5,382
-----------
NEW HAMPSHIRE (0.4%)
New Hampshire Higher Educ. (Hitchcock Clinic) 6.00% 7/1/2015 (1) 7,560 7,567
-----------
NEW JERSEY (5.7%)
Atlantic County NJ Public Fac. COP 7.40% 3/1/2012 (3) 4,335 5,078
Hoboken-Union City-Weehawken NJ Sewerage Auth. 6.25% 8/1/2014 (1) 10,185 10,885
Hoboken-Union City-Weehawken NJ Sewerage Auth. 6.25% 8/1/2015 (1) 10,820 11,490
New Jersey Econ. Dev. Auth. Rev. Transp. Project
(Light Rail Transit System) 5.875% 5/1/2015 10,000 10,134
New Jersey Health Care Fac. Finance Auth. Rev.
(Saint Barnabas Health Care) 5.25% 7/1/2015 (1) 7,000 6,613
New Jersey Health Care Fac. Finance Auth. Rev.
(Saint Clares Riverside Medical Center) 5.75% 7/1/2014 (1) 3,000 3,008
New Jersey Health Care Fac. Finance Auth. Rev.
(Virtua Health) 5.25% 7/1/2014 (4) 14,985 14,305
New Jersey Sports & Exposition Auth. Rev. 6.50% 3/1/2013 (1) 18,795 20,676
New Jersey Turnpike Auth. Rev. 6.50% 1/1/2013 (1) 30,000 32,665
New Jersey Turnpike Auth. Rev. 6.50% 1/1/2016 (1) 5,000 5,436
New Jersey Turnpike Auth. Rev. VRDO 3.40% 11/3/1999 (3)LOC 3,100 3,100
-----------
123,390
-----------
NEW MEXICO (0.5%)
Albuquerque NM Hosp. System (Presbyterian Health) 6.375% 8/1/2007 (1) 4,000 4,248
Farmington NM Util. System Rev. 5.75% 5/15/2013 (3) 2,055 2,066
Farmington NM Util. System Rev. 5.75% 5/15/2013 (3)(ETM) 945 962
Univ. of New Mexico Rev. 5.375% 6/1/2026 (1) 5,000 4,581
-----------
11,857
-----------
NEW YORK (3.9%)
Long Island NY Power Auth. Electric System Rev. VRDO 3.50% 11/2/1999 LOC 1,000 1,000
Metro. NY Transit Auth. Rev. (Commuter Fac.) 5.25% 7/1/2028 (4) 4,750 4,223
Metro. NY Transit Auth. Rev. (Dedicated Petroleum Tax) 6.00% 4/1/2020 (1) 18,000 18,340
New York City NY Muni. Water Finance Auth.
Water & Sewer System Rev. 7.00% 6/15/2001 (2)(Prere.) 335 353
New York City NY Muni. Water Finance Auth.
Water & Sewer System Rev. 7.00% 6/15/2009 (2) 1,510 1,586
</TABLE>
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<CAPTION>
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FACE MARKET
MATURITY AMOUNT VALUE*
INSURED LONG-TERM TAX-EXEMPT FUND COUPON DATE (000) (000)
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
New York City NY Muni. Water Finance Auth.
Water & Sewer System Rev. VRDO 3.55% 11/2/1999 (3) $ 1,300 $ 1,300
New York City NY Muni. Water Finance Auth.
Water & Sewer System Rev. VRDO 3.55% 11/2/1999 (3) 115 115
New York City NY VRDO 3.35% 11/3/1999 1,150 1,150
New York State Dormitory Auth. Rev. (St. John's Univ.) 5.25% 7/1/2025 (1) 6,000 5,371
New York State Housing Finance Agency Auth. Rev.
(Nursing Home & Health Care) 4.70% 11/1/2008 (1) 7,125 6,756
New York State Housing Finance Agency Auth. Rev.
(Nursing Home & Health Care) 4.80% 11/1/2009 (1) 13,765 12,995
New York State Housing Finance Agency Auth. Rev.
(Nursing Home & Health Care) 4.90% 11/1/2010 (1) 4,575 4,301
New York State Medical Care Fac. Finance Agency
(Mental Health Serivces) 6.00% 2/15/2005 (1)(Prere.) 4,805 5,148
New York State Medical Care Fac. Finance Agency
(Mental Health Services) 6.00% 8/15/2015 (1) 195 199
Port Auth. of New York & New Jersey Special Obligation Rev.
(JFK International Airport) 5.75% 12/1/2022 (1) 8,455 8,213
Suffolk County NY Water Auth. 5.75% 6/1/2013 (2) 7,345 7,386
Triborough Bridge & Tunnel Auth. Rev. NY 6.00% 1/1/2014 4,500 4,569
Triborough Bridge & Tunnel Auth. Rev. NY 6.00% 1/1/2015 (2) 260 262
-----------
83,267
-----------
NORTH CAROLINA (1.8%)
New Hanover County NC Hosp. Rev.
(New Haven Regional Medical Center Project) 5.00% 10/1/2028 (1) 11,200 9,508
North Carolina Medical Care Rev.
(St. Joseph's Health System) 5.125% 10/1/2028 (1) 10,000 8,635
North Carolina Medical Care Rev. (Wake County Hosp.) 5.25% 10/1/2017 (1) 14,250 12,911
North Carolina Muni. Power Agency (Catawba Electric) 6.00% 1/1/2010 (1) 6,750 7,020
-----------
38,074
-----------
NORTH DAKOTA (0.5%)
Mercer County ND PCR (Basin Electric Power) 6.05% 1/1/2019 (2) 10,000 10,039
-----------
OHIO (5.0%)
Cleveland OH Public Power System Rev. 7.00% 11/15/2004 (1)(Prere.) 5,000 5,600
Cleveland OH School Dist. GO 5.875% 12/1/2011 (3) 4,720 4,888
Cleveland OH Water Works Rev. 6.25% 1/1/2002 (2)(Prere.) 2,405 2,542
Cleveland OH Water Works Rev. 6.25% 1/1/2015 (2) 95 99
Cuyahoga County OH Hosp. Refunding & Improvement
(Univ. Hosp.) 5.625% 1/15/2021 (1) 11,480 10,940
Franklin County OH Convention Center Rev. 0.00% 12/1/2006 (1) 4,355 3,039
Greater Cleveland OH Regional Transp. Auth. GO 5.65% 12/1/2006 (3)(Prere.) 5,000 5,273
Hamilton County OH Hosp. Fac. Rev. VRDO
(Health Alliance of Greater Cincinnati) 3.45% 11/3/1999 (1) 4,500 4,500
Hamilton County OH Sales Tax Rev.
(Hamilton County Football Project) 5.00% 12/1/2027 (1) 10,000 8,589
Northeast OH Regional Sewer Dist. Rev. 6.50% 11/15/2001 (2)(Prere.) 5,750 6,061
Ohio Air Quality Dev. Auth. PCR (Ohio Edison Project) 7.10% 6/1/2018 (3) 6,500 6,721
Ohio Air Quality Dev. Auth. PCR (Ohio Edison Project) 7.45% 3/1/2016 (3) 9,500 9,782
Ohio GO 7.625% 8/1/2009 4,345 5,155
Ohio Water Dev. Auth. PCR (Water Control Loan Fund) 5.125% 6/1/2019 (1) 18,000 16,221
Ohio Water Dev. Auth. PCR (Water Control Loan Fund) 5.50% 12/1/2010 (1) 3,575 3,644
Ohio Water Dev. Auth. PCR (Water Control Loan Fund) 5.50% 6/1/2012 (1) 3,175 3,189
Ohio Water Dev. Auth. PCR (Water Control Loan Fund) 5.50% 6/1/2013 (1) 3,420 3,407
Ohio Water Dev. Auth. PCR (Water Control Loan Fund) 5.50% 6/1/2014 (1) 7,475 7,371
-----------
107,021
-----------
OREGON (1.0%)
Oregon Health Sciences Univ. Rev. 5.25% 7/1/2025 (1) 4,500 4,012
Oregon Health, Housing, Educ. & Culture Fac.
(Lewis & Clark College) 6.00% 10/1/2013 (1) 2,250 2,315
Portland OR Sewer System Rev. 5.50% 6/1/2017 (1) 15,000 14,475
-----------
20,802
-----------
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<CAPTION>
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FACE MARKET
MATURITY AMOUNT VALUE*
COUPON DATE (000) (000)
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
PENNSYLVANIA (8.0%)
Allegheny County PA Sanitation Auth. Sewer Rev. 5.50% 12/1/2016 (3) $ 10,000 $ 9,521
Allegheny County PA Sanitation Auth. Sewer Rev. 6.00% 12/1/2019 (1) 20,000 20,104
Armstrong County PA Hosp. Auth. Rev. 6.25% 6/1/2013 (2) 18,400 19,330
Delaware Valley PA Regional Finance Auth. Local Govt. Rev. 5.50% 8/1/2028 (2) 30,000 28,385
Lehigh County PA General Purpose Auth. (Lehigh Valley Hosp.) 6.50% 7/1/2002 (1)(Prere.) 6,655 7,123
Pennsylvania Convention Center Auth. Rev. 6.00% 9/1/2019 (3)(ETM) 10,000 10,186
Pennsylvania Convention Center Auth. Rev. 6.70% 9/1/2016 (3)(ETM) 9,970 11,088
Pennsylvania Higher Educ. Fac. Health Services Rev.
(Allegheny/Delaware Valley) 5.875% 11/15/2016 (1) 10,000 9,833
Pennsylvania Higher Educ. Fac. Health Services Rev.
(Delaware Valley) 5.875% 11/15/2016 (1) 10,000 9,899
Pennsylvania Turnpike Comm. Rev. 6.00% 6/1/2015 (1) 1,000 1,021
Philadelphia PA Gas Works Rev. 6.00% 5/15/2000 (2)(Prere.) 3,000 3,094
Philadelphia PA Water & Waste Water Rev. 7.00% 6/15/2010 (3) 15,000 16,946
Philadelphia PA Water & Waste Water Rev. 7.00% 6/15/2011 (3) 16,500 18,680
Pittsburgh PA Water & Sewer System Rev. 7.25% 9/1/2014 (3)(ETM) 5,000 5,702
Sharon PA Reqional Health System Auth. Rev.
(Mercer County PA Health System Rev.) 5.00% 12/1/2028 (1) 2,920 2,440
-----------
173,352
-----------
PUERTO RICO (0.2%)
Puerto Rico Public Building Auth. Rev. 0.00% 7/1/2001 (3) 4,150 3,871
-----------
RHODE ISLAND (0.2%)
Rhode Island Public Building Auth. 6.00% 2/1/2011 (2) 3,805 3,890
-----------
SOUTH CAROLINA (2.3%)
Piedmont SC Muni. Power Agency Rev. 6.75% 1/1/2019 (3) 10,600 11,612
Piedmont SC Muni. Power Agency Rev. 6.75% 1/1/2020 (3) 23,515 25,764
Public Service Auth. Rev. of South Carolina 6.25% 1/1/2022 (2) 13,000 13,098
-----------
50,474
-----------
SOUTH DAKOTA (0.5%)
South Dakota Health & Educ. Fac. Auth. Rev. (McKennan Hosp.) 7.625% 1/1/2008 (1)(Prere.) 10,065 11,669
-----------
TENNESSEE (2.3%)
Jackson TN Hosp. Rev. (Madison County General Hosp.) 5.00% 4/1/2028 (2) 13,750 11,628
Johnson City TN Health & Educ. Rev.
(Johnson City Medical Center) 5.125% 7/1/2025 (1) 15,000 13,027
Johnson City TN Health & Educ. Rev.
(Johnson City Medical Center) 5.25% 7/1/2028 (1) 9,250 8,160
Nashville & Davidson County TN Health & Educ. Fac.
(Meharry Medical College) 6.00% 12/1/2012 (2) 3,405 3,582
Tennessee Health, Educ. & Housing Fac.
(Methodist Health System) 5.50% 8/1/2012 (1) 2,500 2,468
Tennessee Housing Dev. Agency 7.125% 7/1/2017 (1) 2,665 2,747
Tennessee School Board Auth. 5.50% 5/1/2006 (4)(Prere.) 990 1,037
Tennessee School Board Auth. Higher Educ. Fac. 5.50% 5/1/2022 (4) 8,010 7,519
-----------
50,168
-----------
TEXAS (8.4%)
Austin TX Combined Util. System Rev. 5.75% 11/15/2016 (2) 10,000 9,840
Corpus Christi TX Util. System Rev. 7.00% 7/15/2010 (3) 7,500 7,791
Houston TX Water & Sewer System Rev. 0.00% 12/1/2019 (4) 62,100 18,143
Houston TX Water & Sewer System Rev. 0.00% 12/1/2021 (4) 40,000 10,294
Houston TX Water & Sewer System Rev. 7.00% 12/1/2000 (1)(Prere.) 12,280 12,923
Houston TX Water Conveyance System 6.25% 12/15/2012 (2) 8,340 8,799
Houston TX Water Conveyance System 6.80% 12/15/2010 (2) 5,490 6,071
Houston TX Water Conveyance System 6.80% 12/15/2011 (2) 8,910 9,863
Lower Colorado River Auth. Rev. of Texas 5.625% 1/1/2015 (4)(Prere.) 3,055 3,047
Lower Colorado River Auth. Rev. of Texas 5.75% 5/15/2012 (4) + 7,500 7,594
Lower Colorado River Auth. Rev. of Texas 6.00% 5/15/2013 (4) + 12,500 12,834
Northeast Texas Hosp. Auth. (Northeast Medical Center) 5.625% 5/15/2017 (4) 7,425 7,086
Northeast Texas Hosp. Auth. (Northeast Medical Center) 5.625% 5/15/2022 (4) 7,110 6,699
Northeast Texas Hosp. Auth. (Northeast Medical Center) 6.00% 5/15/2009 (4) 3,945 4,132
Northeast Texas Hosp. Auth. (Northeast Medical Center) 6.00% 5/15/2010 (4) 2,000 2,079
</TABLE>
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<CAPTION>
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FACE MARKET
MATURITY AMOUNT VALUE*
INSURED LONG-TERM TAX-EXEMPT FUND COUPON DATE (000) (000)
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
San Antonio TX Electric & Gas System Rev. 0.00% 2/1/2007 (3) $ 15,000 $ 10,306
Texas TRAN 4.50% 8/31/2000 40,000 40,222
Texas Turnpike Auth. Dallas Northway Rev.
(President George Bush Turnpike) 0.00% 1/1/2010 (2) 6,000 3,428
-----------
181,151
-----------
VIRGINIA (0.6%)
Henry County VA Public Service Auth. 6.25% 11/15/2019 (3) 1,500 1,514
Norfolk VA Water Dev. 5.90% 11/1/2025 (1) 12,150 12,023
-----------
13,537
-----------
WASHINGTON (1.1%)
Chelan County WA Public Util. Dist.
(Rock Island Hydro Project) 0.00% 6/1/2009 (1) 10,950 6,502
Chelan County WA Public Util. Dist.
(Rock Island Hydro Project) 0.00% 6/1/2015 (1) 12,585 4,925
Chelan County WA Public Util. Dist.
(Rock Island Hydro Project) 0.00% 6/1/2017 (1) 11,000 3,758
Snohomish County WA Mukilteo School Dist. 5.65% 12/1/2010 (3) 3,950 4,075
Snohomish County WA Mukilteo School Dist. 5.70% 12/1/2011 (3) 5,000 5,154
-----------
24,414
-----------
WEST VIRGINIA (1.2%)
West Virginia Hosp. Finance Auth. Rev.
(Charleston Medical Center) 5.75% 9/1/2013 (1) 8,000 8,044
West Virginia State Building Comm. Rev.
(Jail & Correctional Fac.) 7.00% 7/1/2011 (1) 7,325 8,419
West Virginia State Building Comm. Rev.
(Jail & Correctional Fac.) 7.00% 7/1/2012 (1) 7,840 9,003
-----------
25,466
-----------
WISCONSIN (0.2%)
Wisconsin Health & Educ. Fac. Auth. Rev.
(St. Luke's Medical Center) 7.10% 8/15/2001 (1) 4,000 4,271
-----------
- ------------------------------------------------------------------------------------------------------------------------------
TOTAL MUNICIPAL BONDS
(COST $2,156,557) 2,198,886
- ------------------------------------------------------------------------------------------------------------------------------
OTHER ASSETS AND LIABILITIES (-1.8%)
- ------------------------------------------------------------------------------------------------------------------------------
Other Assets--Note B 38,139
Payables for Investment Securities Purchased (69,453)
Other Liabilities (7,368)
-----------
(38,682)
- ------------------------------------------------------------------------------------------------------------------------------
NET ASSETS (100%)
- ------------------------------------------------------------------------------------------------------------------------------
Applicable to 184,785,252 outstanding $.001 par value shares
of beneficial interest (unlimited authorization) $2,160,204
==============================================================================================================================
NET ASSET VALUE PER SHARE $11.69
==============================================================================================================================
*See Note A in Notes to Financial Statements.
For key to abbreviations and other references, see page 67.
- ------------------------------------------------------------------------------------------------------------------------------
AT OCTOBER 31, 1999, NET ASSETS CONSISTED OF:
- ------------------------------------------------------------------------------------------------------------------------------
AMOUNT PER
(000) SHARE
- ------------------------------------------------------------------------------------------------------------------------------
Paid in Capital $2,146,606 $11.62
Undistributed Net Investment Income -- --
Overdistributed Net Realized Gains--Note E (28,731) (.16)
Unrealized Appreciation--Note F 42,329 .23
- ------------------------------------------------------------------------------------------------------------------------------
NET ASSETS $2,160,204 $11.69
==============================================================================================================================
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FACE MARKET
MATURITY AMOUNT VALUE*
LONG-TERM TAX-EXEMPT FUND COUPON DATE (000) (000)
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
MUNICIPAL BONDS (102.4%)
- ------------------------------------------------------------------------------------------------------------------------------
ALABAMA (0.5%)
Birmingham AL Airport Auth. 5.375% 7/1/2020 (2) + $ 6,585 $ 5,978
Huntsville AL Health Care Auth. VRDO 3.50% 11/3/1999 (1) 1,800 1,800
-----------
7,778
-----------
ARIZONA (0.6%)
Scottsdale AZ IDA (Memorial Hosp.) 6.00% 9/1/2012 (2) 4,000 4,083
Scottsdale AZ IDA (Memorial Hosp.) 6.125% 9/1/2017 (2) 4,700 4,739
-----------
8,822
-----------
CALIFORNIA (15.4%)
Anaheim CA Public Finance Auth. 6.00% 9/1/2013 (4) 7,000 7,391
Anaheim CA Public Finance Auth. 6.00% 9/1/2014 (4) 2,500 2,617
California Dept. of Veteran Affairs 5.45% 12/1/2019 (2) 7,655 7,469
California GO 4.75% 12/1/2028 10,000 8,114
California GO 6.25% 9/1/2012 5,000 5,409
California Health Fac. (Cedars-Sinai Medical Center) 6.25% 12/1/2034 + 5,000 4,928
California Public Works Lease Board Rev.
(California State Univ.) 5.50% 10/1/2014 3,000 2,943
California Public Works Lease Board Rev.
(Community College Project) 5.625% 3/1/2016 (2) 11,370 11,243
California Public Works Lease Board Rev.
(Dept. of Corrections) 5.25% 1/1/2021 (2) 5,000 4,587
California Public Works Lease Board Rev.
(Dept. of Corrections) 5.625% 11/1/2016 (1) 16,675 16,451
California Statewide Community Dev. Auth.
(Riverside County) Rev. TRAN 4.00% 9/29/2000 30,000 30,104
California Statewide Community Dev. Auth. PUT
(Irvine Apartments) 5.10% 5/17/2010 10,000 9,348
Contra Costa County CA TRAN 4.00% 9/29/2000 24,000 24,086
Fresno CA Sewer Rev. 6.25% 9/1/2010 (2) 6,395 6,995
Irvine CA Ranch Water Dist. VRDO 3.50% 11/2/1999 LOC 500 500
Irvine CA Ranch Water Dist. VRDO 3.65% 11/2/1999 LOC 350 350
Los Angeles County CA COP (Capital Fac. Project) 6.50% 3/1/2000 (Prere.) 21,815 22,455
Los Angeles County CA Public Works Rev. 5.50% 10/1/2011 5,000 5,072
Los Angeles County CA Public Works Rev. 5.50% 10/1/2012 6,750 6,796
San Bernardino CA Medical Center COP 5.50% 8/1/2019 (1) 11,400 10,884
San Bernardino CA Medical Center COP 5.50% 8/1/2024 (1) 11,295 10,598
San Bernardino County CA COP (Capital Fac. Project) 6.875% 8/1/2024 (ETM) 18,000 20,305
San Diego CA Unified School Dist. GO 0.00% 7/1/2012 (3) 5,420 2,688
San Diego CA Unified School Dist. GO 0.00% 7/1/2013 (3) 7,160 3,316
San Jose CA Redevelopment Agency
(Merged Area Redevelopment Project) 4.75% 8/1/2029 (2) 8,400 6,871
Southern California Public Power Auth. Transmission Project 0.00% 7/1/2014 8,500 3,637
-----------
235,157
-----------
COLORADO (1.2%)
E-470 Public Highway Auth. CO Rev. 0.00% 9/1/2013 (1) 10,000 4,484
E-470 Public Highway Auth. CO Rev. 0.00% 9/1/2016 (1) 10,185 3,685
E-470 Public Highway Auth. CO Rev. 5.00% 9/1/2015 (1) 11,645 10,564
-----------
18,733
-----------
DISTRICT OF COLUMBIA (1.4%)
District of Columbia GO 5.40% 6/1/2012 (2) 5,000 4,864
District of Columbia GO 6.00% 6/1/2011 (1) 8,990 9,309
District of Columbia GO 6.75% 6/1/2000 (2)(Prere.) 6,100 6,320
District of Columbia GO 6.75% 6/1/2005 (1) 40 41
-----------
20,534
-----------
FLORIDA (3.2%)
Dade County FL Water & Sewer System Rev. VRDO 3.45% 11/3/1999 (3) 9,200 9,200
Florida Board of Educ. Capital Outlay 4.75% 6/1/2028 3,000 2,452
Florida Turnpike Auth. Rev. 5.00% 7/1/2019 (3) 10,320 9,180
Orange County FL Health Fac. Auth. VRDO
(AdventistHealth System/Sunbelt) 3.50% 11/4/1999 LOC 400 400
Orange County FL School Dist. COP 5.375% 8/1/2017 (1) 5,000 4,718
Sunrise FL Util. System Rev. 5.50% 10/1/2018 (2) 12,000 11,602
Tampa Bay FL Water Util. System Rev. 5.00% 10/1/2021 (3) 12,860 11,360
-----------
48,912
-----------
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FACE MARKET
MATURITY AMOUNT VALUE*
LONG-TERM TAX-EXEMPT FUND COUPON DATE (000) (000)
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
GEORGIA (2.3%)
Atlanta GA Water & Wastewater Rev. 5.50% 11/1/2022 (3) $ 10,000 $ 9,573
College Park GA IDA GO (Civic Center) 7.00% 9/1/2010 11,500 12,908
Metro. Atlanta GA Rapid Transit Auth. Rev. 6.25% 7/1/2018 12,170 12,943
-----------
35,424
-----------
HAWAII (0.5%)
Honolulu HI GO 5.125% 7/1/2012 (3) 4,000 3,825
Honolulu HI GO 5.125% 7/1/2013 (3) 4,580 4,316
-----------
8,141
-----------
ILLINOIS (4.4%)
Chicago IL Board of Educ. 0.00% 12/1/2013 (2) 5,000 2,201
Chicago IL Board of Educ. 0.00% 12/1/2014 (2) 5,000 2,046
Chicago IL Board of Educ. 0.00% 12/1/2016 (2) 8,545 3,030
Chicago IL Metro. Water Capital Improvement Rev. 7.00% 1/1/2011 20,000 22,620
Chicago IL Public Building Comm. 7.00% 1/1/2020 (1)(ETM) 6,000 6,787
Illinois Dev. Finance Auth. PCR (Illinois Power Co. Project) 7.40% 12/1/2024 (1) 8,150 9,025
Illinois Metro. Pier & Exposition Auth. Rev. 0.00% 12/15/2014 16,100 6,602
Illinois Metro. Pier & Exposition Auth. Rev. 6.75% 6/1/2010 (1) 6,000 6,630
Illinois Toll Highway Auth. Rev. VRDO 3.50% 11/3/1999 (1) LOC 3,555 3,555
Will County IL Community School Dist. 0.00% 11/1/2013 (4) 10,000 4,423
-----------
66,919
-----------
INDIANA (1.5%)
Indiana Health Fac. Financing Auth. Hosp. Rev.
(Ancilla System, Inc.) 5.75% 7/1/2015 (1) 4,470 4,366
Indiana Office Building Comm. Rev. (Capitol Complex) 6.90% 7/1/2011 16,875 18,847
-----------
23,213
-----------
LOUISIANA (1.7%)
De Soto Parish LA PCR (Southwestern Electric Power Co.) 7.60% 1/1/2019 24,300 26,426
-----------
MAINE (0.7%)
Maine Health & Higher Educ. Fac. Auth Rev. 5.25% 7/1/2023 (1) 11,495 10,174
-----------
MARYLAND (1.0%)
Maryland Health & Higher Educ. Fac. Auth. Rev.
(Medlantic\Helix) 5.25% 8/15/2038 (4) 17,500 15,278
-----------
MASSACHUSETTS (8.4%)
Massachusetts Bay Transp. Auth. 7.00% 3/1/2021 15,000 16,848
Massachusetts GO 5.75% 5/1/2002 (Prere.) 7,500 7,869
Massachusetts GO 6.00% 6/1/2001 (Prere.) 3,500 3,596
Massachusetts GO 6.50% 8/1/2011 2,345 2,468
Massachusetts Health & Educ. Fac. Auth. Rev.
(Boston Medical Center) 5.00% 7/1/2019 (1) 3,450 2,972
Massachusetts Health & Educ. Fac. Auth. Rev.
(Caritas Christi Obligated Group) 5.70% 7/1/2015 8,665 7,651
Massachusetts Health & Educ. Fac. Auth. Rev.
(Harvard Pilgrim Health) 5.00% 7/1/2018 (4) 9,920 8,593
Massachusetts Health & Educ. Fac. Auth. Rev.
(Univ. of Massachusetts Memorial) 5.00% 7/1/2018 (2) 3,685 3,192
Massachusetts Health & Educ. Fac. Auth. Rev.
(Univ. of Massachusetts Memorial) 5.00% 7/1/2028 (2) 3,500 2,937
Massachusetts Health & Educ. Fac. Auth. Rev. VRDO
(Harvard Univ.) 3.34% 11/4/1999 1,325 1,325
Massachusetts Housing Finance Agency 6.125% 11/15/2008 3,500 3,617
Massachusetts Port Auth. Rev. 5.00% 7/1/2018 3,500 3,078
Massachusetts Turnpike Auth. Rev. (Metro. Highway System) 5.125% 1/1/2023 (1) 23,000 20,290
Massachusetts Water Resources Auth. Rev. 5.50% 7/15/2002 (Prere.) 5,000 5,140
Massachusetts Water Resources Auth. Rev. 5.50% 11/1/2006 (3)(Prere.) 4,880 5,098
Massachusetts Water Resources Auth. Rev. 6.50% 7/15/2019 32,000 34,196
-----------
128,870
-----------
</TABLE>
54
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<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------
FACE MARKET
MATURITY AMOUNT VALUE*
COUPON DATE (000) (000)
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
MICHIGAN (1.7%)
Detroit MI GO 6.375% 4/1/2007 $ 4,500 $ 4,755
Grand Rapids MI Tax Increment Rev. (Downtown Project) 6.875% 6/1/2024 (1) 7,500 8,098
Wayne Charter County MI Airport Rev. 5.25% 12/1/2018 (1) 15,005 13,484
-----------
26,337
-----------
MISSISSIPPI (1.4%)
Mississippi GO 6.00% 11/1/2013 + 10,250 10,569
Mississippi GO 6.00% 11/1/2014 + 10,800 11,053
-----------
21,622
-----------
MISSOURI (0.7%)
Missouri Health & Educ. Fac. Auth. VRDO
(Sisters of Mercy Health Care System) 3.45% 11/3/1999 10,300 10,300
-----------
NEVADA (2.4%)
Clark County NV Building Auth. 5.25% 6/15/2016 (3) 7,000 6,473
Clark County NV Passenger Fac. Rev. 5.375% 7/1/2014 (1) 14,780 14,150
Humboldt County NV PCR (Idaho Power Co.) 8.30% 12/1/2014 9,100 10,241
Nevada GO 5.25% 5/15/2016 6,570 6,077
-----------
36,941
-----------
NEW JERSEY (2.5%)
New Jersey Health Care Fac. Auth. Rev.
(Atlantic City Medical Center) 6.80% 7/1/2005 3,500 3,729
New Jersey Sports & Exposition Auth. Rev. 6.50% 3/1/2002 (Prere.) 3,255 3,467
New Jersey Sports & Exposition Auth. Rev. 6.50% 3/1/2013 10,000 11,001
New Jersey Sports & Exposition Auth. Rev. 6.50% 3/1/2019 16,745 17,537
New Jersey Turnpike Auth. Rev. VRDO 3.40% 11/3/1999 (3)LOC 2,000 2,000
-----------
37,734
-----------
NEW YORK (10.0%)
Babylon NY Waste Water Fac. GO 9.00% 8/1/2008 (3) 4,900 6,148
Babylon NY Waste Water Fac. GO 9.00% 8/1/2009 (3) 2,800 3,556
Babylon NY Waste Water Fac. GO 9.00% 8/1/2010 (3) 4,900 6,301
Metro. Transit Auth. of New York (Dedicated Petroleum Tax) 5.25% 4/1/2026 (1) 4,675 4,173
Metro. Transit Auth. of New York (Dedicated Petroleum Tax) 6.00% 4/1/2020 (1) 13,665 13,923
Metro. Transit Auth. of New York (Transp. Fac. Rev.) 5.70% 7/1/2017 (1) 8,320 8,099
New York City NY GO 7.10% 2/1/2002 (1)(Prere.) 355 380
New York City NY GO 7.10% 2/1/2010 (1) 720 766
New York City NY Muni. Water Finance Auth. Water &
Sewer System Rev. 7.00% 6/15/2001 (Prere.) 2,520 2,654
New York City NY Transitional Finance Auth. Future Tax Rev.
VRDO 3.50% 11/3/1999 LOC 4,600 4,600
New York City NY Transitional Finance Auth. Rev. 4.75% 11/1/2023 5,750 4,747
New York City NY Transitional Finance Auth. Rev. 5.00% 5/1/2017 5,000 4,428
New York City NY VRDO 3.35% 11/3/1999 LOC 400 400
New York State Dormitory Auth. Rev. (State Univ.) 5.00% 5/15/2014 10,000 9,020
New York State Dormitory Auth. Rev. (State Univ.) 7.50% 5/15/2011 18,900 21,617
New York State Dormitory Auth. Rev. VRDO
(Sloan-Kettering Cancer Center) 3.50% 11/2/1999 LOC 900 900
New York State Local Govt. Assistance Corp. 5.375% 4/1/2012 5,275 5,142
New York State Local Govt. Assistance Corp. 5.40% 4/1/2013 13,125 12,699
New York State Local Govt. Assistance Corp. 5.40% 4/1/2015 5,700 5,363
New York State Medical Care Fac. Finance Auth. Agency Rev.
(Hosp. & Nursing Home Mortgage Rev.) 6.875% 2/15/2002 (7)(Prere.) 640 685
New York State Medical Care Fac. Finance Auth. Agency Rev.
(Hosp. & Nursing Home Mortgage Rev.) 6.875% 2/15/2032 (7) 4,360 4,612
Triborough Bridge & Tunnel Auth. Rev. NY 5.00% 1/1/2015 (4) 5,000 4,525
Triborough Bridge & Tunnel Auth. Rev. NY 5.00% 1/1/2016 (4) 5,000 4,487
Triborough Bridge & Tunnel Auth. Rev. NY 5.00% 1/1/2024 6,845 5,883
Triborough Bridge & Tunnel Auth. Rev. NY 5.50% 1/1/2030 7,750 7,141
Triborough Bridge & Tunnel Auth. Rev. NY 6.125% 1/1/2021 10,000 10,343
-----------
152,592
-----------
</TABLE>
55
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<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------
FACE MARKET
MATURITY AMOUNT VALUE*
LONG-TERM TAX-EXEMPT FUND COUPON DATE (000) (000)
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
NORTH CAROLINA (2.4%)
Cumberland County NC Hosp. Fac. Rev. (Cape Fear Hosp.) 5.25% 10/1/2024 $ 5,000 $ 4,250
New Hanover County NC Hosp. Rev.
(New Haven Regional Medical Center Project) 5.00% 10/1/2028 (1) 5,000 4,245
North Carolina Eastern Muni. Power Agency Rev. 6.50% 1/1/2018 (ETM) 4,625 5,002
North Carolina Eastern Muni. Power Agency Rev. 7.50% 1/1/2009 (Prere.) 4,935 5,814
North Carolina Medical Care Rev. (Novant Health Project) 5.00% 10/1/2024 5,200 4,460
North Carolina Medical Care Rev. (St. Joseph's Health System) 5.10% 10/1/2018 5,000 4,395
North Carolina Medical Care Rev. (St. Joseph's Health System) 5.125% 10/1/2028 (1) 2,000 1,727
North Carolina Medical Care Rev. (Wake County Hosp.) 5.25% 10/1/2017 (1) 7,100 6,433
-----------
36,326
-----------
OHIO (0.3%)
Franklin County OH Hosp. Rev. (Children's Hosp.) 5.75% 11/1/2020 2,945 2,800
Hamilton County OH Hosp. Fac. Rev. VRDO
(Health Alliance of Greater Cincinnati) 3.45% 11/3/1999 (1) 1,740 1,740
-----------
4,540
-----------
OKLAHOMA (1.0%)
Oklahoma Dev. Finance Auth. (Hillcrest Hosp.) 5.625% 8/15/2029 12,000 9,881
Tulsa OK Metro. Util. Auth. Rev. 5.75% 9/1/2019 (1) 5,525 5,397
-----------
15,278
-----------
OREGON (1.1%)
Clackamas County OR Hosp. Fac. Auth. Rev.
(Legacy Health System) 5.50% 2/15/2014 7,330 7,097
Portland OR Sewer System Rev. 5.50% 6/1/2017 (1) 10,090 9,737
-----------
16,834
-----------
PENNSYLVANIA (9.5%)
Allegheny County PA Sanitation Auth. Sewer Rev. 6.00% 12/1/2019 (1) 10,000 10,052
Delaware County PA IDA Resource Recovery Rev.
(Browning Ferris) 6.10% 7/1/2013 15,000 13,927
Delaware Valley PA Regional Finance Auth. Local Govt. Rev. 5.50% 8/1/2028 (2) 15,000 14,192
Pennsylvania GO 6.375% 9/15/2009 11,000 11,561
Pennsylvania GO 6.375% 9/15/2010 8,820 9,260
Pennsylvania GO 6.375% 9/15/2011 5,975 6,273
Pennsylvania GO 6.375% 9/15/2012 13,500 14,072
Pennsylvania Higher Educ. Fac. Auth. Rev. VRDO
(Carnegie Mellon Univ.) 3.60% 11/2/1999 400 400
Pennsylvania Housing Finance Agency Residential Dev. Rev. 7.50% 7/1/2006 3,890 4,085
Pennsylvania Turnpike Comm. Oil Franchise Tax Rev. 5.00% 12/1/2023 (2) 7,975 6,884
Philadelphia PA Hosp. & Higher Educ. Fac. Auth. Rev.
(Jefferson Health System) 5.125% 5/15/2018 (2) 10,000 8,815
Philadelphia PA Water & Waste Water Rev. 7.00% 6/15/2010 (3) 20,000 22,595
Pittsburgh PA GO 5.25% 9/1/2016 (3) 8,195 7,581
Pittsburgh PA School Dist. 5.50% 9/1/2014 (1) 4,715 4,589
Pittsburgh PA Water & Sewer Auth. Rev. 6.50% 9/1/2013 (3) 10,000 10,878
Radnor Township PA School Auth. 9.875% 9/15/2000 (ETM) 110 115
-----------
145,279
-----------
PUERTO RICO (0.7%)
Puerto Rico Electric Power Auth. Rev. 5.25% 7/1/2014 (1) 2,580 2,503
Puerto Rico Electric Power Auth. Rev. 5.25% 7/1/2014 (4) 2,000 1,940
Puerto Rico Govt. Dev. Bank VRDO 3.25% 11/3/1999 (1) 5,600 5,600
-----------
10,043
-----------
SOUTH CAROLINA (1.0%)
Piedmont SC Muni. Power Agency Rev. 6.50% 1/1/2015 (3) 12,210 13,000
Piedmont SC Muni. Power Agency Rev. 6.50% 1/1/2015 (3)(ETM) 2,035 2,212
-----------
15,212
-----------
TENNESSEE (2.7%)
Johnson City TN Health & Educ. Rev.
(Johnson City Medical Center) 5.125% 7/1/2025 (1) 15,000 13,027
Johnson City TN Health & Educ. Rev.
(Johnson City Medical Center) 5.25% 7/1/2028 (1) 10,570 9,324
Knoxville TN Health, Educ. & Housing Board Rev.
(Univ. Health System Inc.) 5.625% 4/1/2024 22,000 19,246
-----------
41,597
-----------
</TABLE>
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<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------
FACE MARKET
MATURITY AMOUNT VALUE*
COUPON DATE (000) (000)
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
TEXAS (14.3%)
Austin TX Independent School Dist. 0.00% 8/1/2013 $ 7,325 $ 3,301
Bexar County TX Health Fac. Dev. Corp.
(Baptist Health System) 5.375% 11/15/2022 (1) 5,000 4,531
Brazos County TX Health Dev. Franciscan Service Corp. 5.375% 1/1/2022 (1) 5,750 5,220
Harris County TX Health Fac. Dev. Corp. Hosp. Rev. VRDO
(St. Lukes Episcopal Hosp.) 3.65% 11/2/1999 5,600 5,600
Houston TX Hotel Occupancy Tax Rev. 5.50% 7/1/2011 (4) 21,760 21,684
Houston TX Independent School Dist. 0.00% 9/15/2012 (2) 6,150 2,953
Houston TX Water & Sewer System Rev. 0.00% 12/1/2012 (2) 20,500 9,724
Houston TX Water & Sewer System Rev. 6.375% 12/1/2001 (2)(Prere.) 360 382
Houston TX Water & Sewer System Rev. 6.375% 12/1/2017 (2) 5,640 5,799
Lewisville TX Independent School Dist. 0.00% 8/15/2016 5,630 2,042
Lewisville TX Independent School Dist. 0.00% 8/15/2017 6,940 2,350
Lower Colorado River Auth. 5.75% 5/15/2012 (4) + 5,500 5,569
Lower Colorado River Auth. 6.00% 5/15/2011 (4) + 12,605 13,135
North East TX Independent School Dist. 5.00% 2/1/2016 6,425 5,782
Round Rock TX Independent School Dist. 0.00% 8/15/2011 (1) 5,000 2,583
San Antonio TX Electric & Gas Rev. 5.00% 2/1/2002 (Prere.) 610 623
San Antonio TX Electric & Gas Rev. 5.00% 2/1/2017 13,525 12,016
Texas City TX IDA (Arco Pipeline Project) 7.375% 10/1/2020 17,000 19,741
Texas Muni. Power Agency 0.00% 9/1/2013 19,915 8,930
Texas TRAN 4.50% 8/31/2000 30,000 30,166
Texas Turnpike Auth. Dallas Northway Rev.
(President George Bush Turnpike) 5.25% 1/1/2023 (3) 19,300 17,321
Texas Water Dev. Board Rev. 5.25% 7/15/2017 7,000 6,460
Texas Water Dev. Board Rev. 6.50% 7/15/2010 17,425 19,146
Texas Water Dev. Board Rev. 7.05% 8/1/2025 5,655 6,128
Tomball TX Hosp. Auth. Rev. 6.00% 7/1/2025 3,600 3,278
Tomball TX Hosp. Auth. Rev. 6.00% 7/1/2029 5,000 4,524
-----------
218,988
-----------
UTAH (1.3%)
Intermountain Power Agency UT Power Supply Rev. 5.00% 7/1/2020 (1) 18,345 15,778
Intermountain Power Agency UT Power Supply Rev. 5.75% 7/1/2019 (1) 3,000 2,910
Utah GO VRDO 3.35% 11/3/1999 700 700
-----------
19,388
-----------
VIRGINIA (0.7%)
Richmond VA Metro. Expressway Auth. Rev. 6.375% 7/15/2016 (3) 5,400 5,770
Virginia College Building Auth.
(Washington & Lee Univ.) 5.25% 1/1/2031 (1) 5,430 4,810
-----------
10,580
-----------
WASHINGTON (2.9%)
Chelan County WA Public Util. Dist.
(Rock Island Hydro Project) 0.00% 6/1/2014 (1) 5,000 2,108
Chelan County WA Public Util. Dist.
(Rock Island Hydro Project) 0.00% 6/1/2017 (1) 11,685 3,992
Chelan County WA Public Util. Dist.
(Rock Island Hydro Project) 0.00% 6/1/2018 (1) 10,000 3,197
Seattle WA Muni. Light & Power VRDO 3.45% 11/3/1999 1,900 1,900
Washington Department of Ecology COP
(State Office Building Project) 5.00% 4/1/2016 27,820 24,332
Washington GO 5.50% 5/1/2018 4,000 3,843
Washington GO 6.75% 2/1/2015 3,450 3,797
Washington Health Care Fac. Auth. Rev. VRDO
(Virginia Mason Medical Center) 3.65% 11/2/1999 (1) 1,670 1,670
-----------
44,839
-----------
WEST VIRGINIA (0.7%)
West Virginia Building Comm. Rev.
(Jail & Correction Fac.) 7.00% 7/1/2014 (1) 8,975 10,249
-----------
WISCONSIN (2.3%)
Wisconsin Center Dist. Tax Rev. 5.25% 12/15/2023 (4) 8,000 7,221
Wisconsin Clean Water Rev. 6.875% 6/1/2011 20,500 23,041
Wisconsin State Health & Educ. Fac. (Aurora Health) 5.625% 2/15/2029 5,500 4,720
-----------
34,982
-----------
- ------------------------------------------------------------------------------------------------------------------------------
TOTAL MUNICIPAL BONDS
(COST $1,577,025) 1,564,042
- ------------------------------------------------------------------------------------------------------------------------------
</TABLE>
57
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<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------
MARKET
VALUE*
LONG-TERM TAX-EXEMPT FUND (000)
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
OTHER ASSETS AND LIABILITIES (-2.4%)
- ------------------------------------------------------------------------------------------------------------------------------
Other Assets--Note B $ 27,709
Payables for Investment Securities Purchased (57,400)
Other Liabilities (6,855)
-----------
(36,546)
- ------------------------------------------------------------------------------------------------------------------------------
NET ASSETS (100%)
- ------------------------------------------------------------------------------------------------------------------------------
Applicable to 147,705,654 outstanding $.001 par value shares
of beneficial interest (unlimited authorization) $1,527,496
==============================================================================================================================
NET ASSET VALUE PER SHARE $10.34
==============================================================================================================================
*See Note A in Notes to Financial Statements.
For key to abbreviations and other references, see page 67.
- ------------------------------------------------------------------------------------------------------------------------------
AT OCTOBER 31, 1999, NET ASSETS CONSISTED OF:
- ------------------------------------------------------------------------------------------------------------------------------
AMOUNT PER
(000) SHARE
- ------------------------------------------------------------------------------------------------------------------------------
Paid in Capital $1,554,015 $10.52
Undistributed Net Investment Income -- --
Overdistributed Net Realized Gains--Note E (13,536) (.09)
Unrealized Depreciation--Note F (12,983) (.09)
- ------------------------------------------------------------------------------------------------------------------------------
NET ASSETS $1,527,496 $10.34
==============================================================================================================================
</TABLE>
58
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<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------
FACE MARKET
MATURITY AMOUNT VALUE*
HIGH-YIELD TAX-EXEMPT FUND COUPON DATE (000) (000)
- ------------------------------------------------------------------------------------------------------------------------------
MUNICIPAL BONDS (100.6%)
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
ALABAMA (1.0%)
Alabama Special Care Fac. (Baptist Health System) 5.875% 11/15/2026 (1) $ 5,000 $ 4,845
Courtland AL Industrial Dev. Board Solid Waste
(International Corp. Project) 6.70% 11/1/2029 + 9,500 9,500
McIntosh AL IDR (Environmental Improvement) 5.375% 6/1/2028 17,000 15,008
-----------
29,353
-----------
ALASKA (0.2%)
North Slope Borough AK GO 7.50% 6/30/2001 (3) 3,000 3,152
Valdez AK Marine Terminal Rev. VRDO
(Exxon Pipeline Co. Project) 3.50% 11/2/1999 1,200 1,200
-----------
4,352
-----------
ARIZONA (1.2%)
Board of Regents Rev. (Univ. of Arizona) 6.20% 6/1/2016 26,660 28,148
Pima County AZ IDA Multi Family Mortgage
(La Cholla Project) 8.50% 7/1/2020 6,615 7,195
-----------
35,343
-----------
ARKANSAS (0.1%)
North Little Rock AR Electric System Rev. 6.50% 7/1/2015 (1) 3,450 3,718
-----------
CALIFORNIA (10.1%)
California Health Fac. (Cedars-Sinai Medical Center) 6.25% 12/1/2034 + 7,500 7,392
California Statewide Community Dev. Auth.
(Archstone/LeClub) 5.30% 6/1/2008 5,000 4,872
California Statewide Community Dev. Auth.
(Archstone/Oak Ridge) 5.30% 6/1/2029 5,900 5,749
California Statewide Community Dev. Auth.
(Archstone/Pelican Hill) 5.30% 6/1/2008 5,000 4,872
California Statewide Community Dev. Auth.
(Archstone/River Meadows) 5.30% 6/1/2008 5,000 4,872
California Statewide Community Dev. Auth. PUT
(Irvine Apartments) 5.10% 5/17/2010 22,000 20,566
California Statewide Community Dev. Auth. PUT
(Irvine Apartments) 5.25% 5/15/2013 20,000 18,639
California Statewide Community Dev. Auth. TRAN
(Riverside County) 4.00% 9/29/2000 35,000 35,122
California Veterans GO 5.20% 12/1/2010 22,000 21,725
California Veterans GO 5.25% 12/1/2011 38,000 37,233
Capistrano CA Unified School Dist. Community Fac. Dist.
Special Tax 5.40% 9/1/2012 2,020 1,892
Capistrano CA Unified School Dist. Community Fac. Dist.
Special Tax 5.60% 9/1/2014 1,570 1,459
Capistrano CA Unified School Dist. Community Fac. Dist.
Special Tax 5.65% 9/1/2015 2,555 2,363
Capistrano CA Unified School Dist. Community Fac. Dist.
Special Tax 5.75% 9/1/2029 8,000 7,108
Roseville CA Community Fac. Dist. 5.40% 9/1/2008 2,000 1,911
Roseville CA Community Fac. Dist. 5.80% 9/1/2017 10,000 9,306
Sacramento CA Muni. Util. Dist. Electric Rev. 5.25% 7/1/2028 18,000 15,916
San Bernardino County CA COP (Capital Fac. Project) 6.875% 8/1/2024 (ETM) 25,220 28,450
San Bernardino County CA COP (Medical Center Funding) 7.00% 8/1/2020 12,180 13,660
San Joaquin Hills CA Transp. Corridor Agency Toll Road Rev. 0.00% 1/15/2007 (1) 3,500 2,450
San Joaquin Hills CA Transp. Corridor Agency Toll Road Rev. 0.00% 1/15/2009 (1) 4,095 2,538
San Joaquin Hills CA Transp. Corridor Agency Toll Road Rev. 0.00% 1/15/2016 22,500 14,059
San Joaquin Hills CA Transp. Corridor Agency Toll Road Rev. 0.00% 1/15/2017 20,000 12,453
Southern California Public Power Auth. Rev. 6.00% 7/1/2018 3,985 3,986
Univ. of California Hosp. (Medical Center) 6.00% 7/1/2026 (2) 10,260 10,138
-----------
288,731
-----------
COLORADO (3.9%)
Denver CO City & County School Dist. 5.00% 12/1/2023 (3) 25,800 22,328
E-470 Public Highway Auth. CO Rev. 0.00% 9/1/2003 (1) 8,200 6,825
E-470 Public Highway Auth. CO Rev. 0.00% 9/1/2006 (1) 22,000 15,486
E-470 Public Highway Auth. CO Rev. 0.00% 9/1/2007 (1) 12,500 8,295
E-470 Public Highway Auth. CO Rev. 0.00% 9/1/2008 (1) 14,000 8,742
E-470 Public Highway Auth. CO Rev. 0.00% 9/1/2009 (1) 16,195 9,514
E-470 Public Highway Auth. CO Rev. 0.00% 9/1/2010 (1) 7,185 3,957
E-470 Public Highway Auth. CO Rev. 0.00% 9/1/2012 (1) 26,795 12,892
E-470 Public Highway Auth. CO Rev. 0.00% 9/1/2013 (1) 5,000 2,242
E-470 Public Highway Auth. CO Rev. 0.00% 9/1/2014 (1) 5,000 2,086
E-470 Public Highway Auth. CO Rev. 0.00% 9/1/2015 (1) 5,000 1,936
E-470 Public Highway Auth. CO Rev. 0.00% 9/1/2017 (1) 23,795 8,034
E-470 Public Highway Auth. CO Rev. 0.00% 9/1/2019 (1) 33,000 9,790
-----------
112,127
-----------
</TABLE>
59
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<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------
FACE MARKET
MATURITY AMOUNT VALUE*
HIGH-YIELD TAX-EXEMPT FUND COUPON DATE (000) (000)
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
CONNECTICUT (0.8%)
Connecticut Dev. Auth. PCR (Connecticut Power & Light) 5.85% 9/1/2028 $ 25,475 $ 23,281
-----------
DISTRICT OF COLUMBIA (2.1%)
District of Columbia GO 5.75% 6/1/2010 (1) 15,000 15,273
District of Columbia GO 6.00% 6/1/2012 (1) 7,000 7,205
Metro. Washington D.C. Airport Auth. Rev. 5.50% 10/1/2009 (3) 6,795 6,883
Metro. Washington D.C. Airport Auth. Rev. 5.50% 10/1/2010 (3) 7,270 7,303
Metro. Washington D.C. Airport Auth. Rev. 5.50% 10/1/2024 (1) 2,000 1,847
Metro. Washington D.C. Airport Auth. Rev. 5.70% 10/1/2007 (1) 12,900 13,308
Metro. Washington D.C. Airport Auth. Rev. 5.875% 10/1/2015 (1) 8,400 8,335
-----------
60,154
-----------
FLORIDA (2.6%)
Citrus County FL PCR (Florida Power Corp.) 6.35% 2/1/2022 6,500 6,577
Hillsborough County FL Aviation Auth. Rev.
(Tampa Airport) 5.25% 10/1/2003 (2) 2,000 2,040
Lee County FL IDA Health Care Fac. Rev.
(Shell Point Village Project) 5.50% 11/15/2021 3,750 3,199
Lee County FL IDA Health Care Fac. Rev.
(Shell Point Village Project) 5.75% 11/15/2011 1,475 1,413
Lee County FL IDA Health Care Fac. Rev.
(Shell Point Village Project) 5.75% 11/15/2014 1,000 936
Northern Palm Beach County FL Improvement Dist.
Water Control & Improvement Unit Dev. 5.85% 8/1/2013 2,500 2,364
Northern Palm Beach County FL Improvement Dist.
Water Contol & Improvement Unit Dev. 6.00% 8/1/2029 2,000 1,830
Orange County FL School Master Lease COP 6.00% 8/1/2008 (1) 11,580 12,350
Orange County FL School Master Lease COP 6.00% 8/1/2009 (1) 12,255 13,064
Orange County FL School Master Lease COP 6.00% 8/1/2010 (1) 12,825 13,596
Orlando FL Special Assessment Rev.
(Conroy Road Interchange Project) 5.25% 5/1/2005 2,005 1,923
Orlando FL Special Assessment Rev.
(Conroy Road Interchange Project) 5.50% 5/1/2010 1,000 935
Orlando FL Special Assessment Rev.
(Conroy Road Interchange Project) 5.80% 5/1/2026 1,000 888
Orlando FL Util. Comm. Rev. 6.75% 10/1/2017 2,200 2,440
Palm Beach County FL Solid Waste Auth. Rev. 6.00% 10/1/2007 (2) 10,850 11,589
-----------
75,144
-----------
GEORGIA (3.3%)
Atlanta GA Water & Sewer Rev. 5.25% 1/1/2007 (3)(Prere.) 7,850 8,065
Atlanta GA Water & Wastewater Rev. 5.50% 11/1/2015 (3) 8,500 8,349
Atlanta GA Water & Wastewater Rev. 5.50% 11/1/2016 (3) 7,000 6,834
Cartersville GA Water & Waste Water Fac.
(Anheuser-Busch Cos., Inc.) 7.40% 11/1/2010 5,000 5,580
Dalton County GA Dev. Auth. (Hamilton Health Care System) 5.50% 8/15/2017 (1) 5,000 4,808
Dalton County GA Dev. Auth. (Hamilton Health Care System) 5.50% 8/15/2026 (1) 12,000 11,249
Effingham County GA Dev. Auth. Solid Waste Disposal Rev.
(Fort James Project) 5.625% 7/1/2018 32,550 28,929
Georgia Muni. Electric Auth. Rev. 6.60% 1/1/2018 (1) 5,000 5,404
Savannah GA Hosp. Auth. Rev. (Candler Hosp.) 7.00% 1/1/2003 (Prere.) 13,000 14,083
-----------
93,301
-----------
HAWAII (1.8%)
Hawaii Dept. of Budget & Finance (Hawaiian Electric Co.) 4.95% 4/1/2012 (1) 15,000 14,107
Hawaii GO 6.25% 3/1/2007 (3) 5,000 5,364
Hawaii Harbor Capital Improvement Rev. 5.50% 7/1/2027 (1) 18,500 16,795
Honolulu HI City & County Waste Water Systen Rev. 0.00% 7/1/2017 (3) 6,000 2,043
Honolulu HI City & County Waste Water System Rev. 0.00% 7/1/2018 (3) 2,000 637
Honolulu HI GO 5.125% 7/1/2015 (3) 4,095 3,746
Honolulu HI GO 5.125% 7/1/2016 (3) 10,655 9,672
-----------
52,364
-----------
ILLINOIS (3.3%)
Chicago IL Public Building Comm. 7.00% 1/1/2015 (1)(ETM) 10,000 11,036
Chicago IL Public Building Comm. 7.00% 1/1/2020 (1)(ETM) 10,000 11,312
Chicago IL O'Hare International Airport Special Fac. Rev.
(International Terminal) 7.50% 1/1/2000 (Prere.) 4,000 4,104
</TABLE>
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FACE MARKET
MATURITY AMOUNT VALUE*
COUPON DATE (000) (000)
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Cook County IL GO 6.60% 11/15/2002 (1)(Prere.) $12,000 $ 12,954
Illinois Dev. Finance Auth. PCR (Illinois Power Co. Project) 7.40% 12/1/2024 (1) 20,000 22,148
Illinois Dev. Finance Auth. Rev. (Regency Park Project) 10.25% 4/15/2019 - 6,500 5,265
Illinois Dev. Finance Auth. Rev. (Regency Park Project) 10.625% 4/15/2020 - 6,000 4,860
Illinois Dev. Finance Auth. Rev. Solid Waste Disposal
(Waste Management Project) 5.05% 1/1/2010 4,000 3,505
Illinois Health Fac. Auth. Rev. (Centegra Health System) 5.10% 9/1/2011 (2) 3,105 2,965
Illinois Health Fac. Auth. Rev. (Centegra Health System) 5.25% 9/1/2018 (2) 3,500 3,074
Illinois Health Fac. Auth. Rev. (Centegra Health System) 5.25% 9/1/2024 (2) 7,500 6,577
Illinois Health Fac. Auth. Rev. (United Medical Center) 8.125% 7/1/2003 (Prere.) 2,140 2,327
Illinois Toll Highway Auth. Rev. 6.30% 1/1/2011 5,000 5,334
-----------
95,461
-----------
INDIANA (2.3%)
Indiana Health Fac. Finance Auth. Rev. (Ancilla System, Inc.) 7.375% 7/1/2023 19,400 21,662
Indiana Office Building Comm. Rev. (Capitol Complex) 6.90% 7/1/2011 15,660 17,490
Indianapolis IN Local Public Improvement Bond Bank 6.75% 2/1/2014 21,500 23,779
Indianapolis IN Local Public Improvement Bond Bank 6.75% 2/1/2020 2,500 2,641
-----------
65,572
-----------
IOWA (0.3%)
Des Moines IA Rev. (Des Moines General Hosp.) 8.25% 11/15/2011 9,620 9,438
-----------
KANSAS (0.2%)
Topeka KS Public Building Comm. 5.00% 6/1/2027 (1) 5,750 4,910
-----------
KENTUCKY (0.4%)
Jefferson County KY (Jewish Hosp. Health) 5.65% 1/1/2017 (2) 8,000 7,678
Jefferson County KY (Jewish Hosp. Health) 5.70% 1/1/2021 (2) 2,000 1,930
Kentucky Property & Buildings Comm. Rev. 5.80% 9/1/2006 3,100 3,204
-----------
12,812
-----------
LOUISIANA (2.1%)
Calcasieu Parish LA IDR PCR (Entergy Gulf States Inc.) 5.45% 7/1/2010 5,000 4,642
Iberia Parish LA Hosp. Services Dist. Rev. 8.00% 5/26/2016 6,250 6,251
Louisiana GO 5.25% 4/15/2010 (4) 10,610 10,509
Louisiana Health Educ. Auth. (Lambeth House Project) 8.75% 10/1/2006 (Prere.) 12,295 15,135
West Feliciana Parish LA PCR (Gulf States Util.) 9.00% 5/1/2015 4,000 4,194
West Feliciana Parish LA PCR PUT (Entergy Gulf States) 5.65% 9/1/2004 19,000 18,793
-----------
59,524
-----------
MAINE (0.2%)
Jay ME Solid Waste Disposal Rev. Refunding 6.20% 9/1/2019 6,250 5,960
-----------
MARYLAND (0.1%)
Hagerstown MD Energy Financing Administration Solid
Waste Disp. Rev. (Hagerstown Fiber Project) 9.00% 10/15/2016 - 17,500 3,675
-----------
MASSACHUSETTS (6.6%)
Massachusetts GO 6.00% 6/1/2001 (Prere.) 14,750 15,156
Massachusetts Grant Anticipation Notes 5.25% 6/15/2012 20,000 19,424
Massachusetts Health & Educ. Fac. Auth. Rev.
(Caritas Christi Obligated Group) 5.70% 7/1/2015 23,500 20,750
Massachusetts Health & Educ. Fac. Auth. Rev.
(Harvard Pilgrim Health) 5.00% 7/1/2028 (4) 24,500 20,559
Massachusetts Health & Educ. Fac. Auth. Rev. VRDO
(Harvard Univ.) 3.34% 11/4/1999 1,000 1,000
Massachusetts Housing Finance Agency Rev. 5.95% 10/1/2008 (2) 27,485 28,342
Massachusetts Ind. Finance Agency (Refusetech Inc. Project) 6.30% 7/1/2005 34,500 35,863
Massachusetts Ind. Finance Agency Solid Waste Disposal Rev.
(Massachusetts Paper Co. Project) 8.50% 11/1/2012 5,677 2,441
Massachusetts Water Resources Auth. Rev. 6.50% 7/15/2019 43,700 46,699
-----------
190,234
-----------
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FACE MARKET
MATURITY AMOUNT VALUE*
HIGH-YIELD TAX-EXEMPT FUND COUPON DATE (000) (000)
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
MICHIGAN (4.5%)
Detroit MI GO 6.25% 4/1/2005 $ 13,000 $ 13,631
Detroit MI GO 6.375% 4/1/2006 8,635 9,124
Dickinson County MI Memorial Hosp. System Rev. 7.625% 11/1/2005 855 928
Dickinson County MI Memorial Hosp. System Rev. 8.00% 11/1/2014 5,700 6,543
Flint MI Hosp. Building Auth. (Hurley Medical Center) 5.25% 7/1/2016 2,250 1,931
Michigan Hosp. Finance Auth. Rev. (Genesys Health System) 7.50% 10/1/2005 (Prere.) 6,620 7,524
Michigan Hosp. Finance Auth. Rev. (Genesys Health System) 8.10% 10/1/2005 (Prere.) 5,000 5,908
Michigan Hosp. Finance Auth. Rev. (Genesys Health System) 8.125% 10/1/2005 (Prere.) 15,000 17,741
Michigan Hosp. Finance Auth. Rev. (McLaren Health Care Corp.) 5.00% 6/1/2028 22,000 17,584
Michigan Housing Dev. Auth. Rev. 6.30% 4/1/2004 6,500 6,805
Michigan Public Power Agency Rev. (Belle River Project) 5.50% 1/1/2013 27,000 26,478
Michigan Strategic Fund Limited Obligation Rev.
(UTD Waste Systems Project) 5.20% 4/1/2010 1,500 1,335
Michigan Strategic Fund Limited Obligation Rev. PUT
(Detroit Edison) 4.73% 9/1/2001 12,000 11,976
Univ. of Michigan Hosp. Rev. VRDO (Medical Service Plan) 3.50% 11/2/1999 1,300 1,300
-----------
128,808
-----------
MINNESOTA (1.1%)
Rochester MN Health Care Fac. Rev. (Mayo Foundation) 5.375% 11/15/2018 12,000 11,220
Rochester MN Health Care Fac. Rev. (Mayo Foundation) 5.50% 11/15/2027 9,000 8,381
Washington County MN Housing & Redev. Auth. Rev.
(Woodland Park Project) 0.00% 5/1/2020 35,070 2,360
Washington County MN Housing & Redev. Auth. Rev.
(Woodland Park Project) 9.75% 5/1/2020 10,035 9,533
-----------
31,494
-----------
MISSOURI (0.8%)
Missouri Health & Educ. Fac. Auth. (SSM Health Care) 5.00% 6/1/2022 (1) 16,000 13,839
Missouri Health & Educ. Fac. Auth.
(St. Luke Mission Health System) 5.375% 11/15/2016 (1) 8,000 7,430
-----------
21,269
-----------
NEBRASKA (1.0%)
Nebraska Public Power Dist. Rev. 5.00% 1/1/2028 (1) 34,000 28,833
-----------
NEVADA (0.2%)
Clark County NV Airport Improvement Rev. VRDO
(McCarran International Airport) 3.45% 11/3/1999 (1) 5,415 5,415
-----------
NEW HAMPSHIRE (0.6%)
New Hampshire Business Finance Auth. PCR PUT
(United Illuminating) 4.55% 2/1/2004 10,000 9,680
New Hampshire Health & Higher Educ. Rev.
(Catholic Medical Center) 6.00% 7/1/2017 6,580 6,371
-----------
16,051
-----------
NEW JERSEY (3.4%)
Hudson County NJ Improvement Auth. Solid Waste Systems Rev. 6.00% 1/1/2029 7,500 7,006
Hudson County NJ Improvement Auth. Solid Waste Systems Rev. 6.125% 1/1/2019 2,000 1,885
Hudson County NJ Improvement Auth. Solid Waste Systems Rev. 6.125% 1/1/2029 16,000 14,909
New Jersey Econ. Dev. Auth. Rev.
(Kapkowski Road Landfill-DST Project Elizabeth) 6.375% 4/1/2018 2,250 2,206
New Jersey Econ. Dev. Auth. Rev.
(Kapkowski Road Landfill -DST Project Elizabeth) 6.375% 4/1/2031 15,000 14,437
New Jersey Econ. Dev. Auth. Rev. (Market Transition) 5.875% 7/1/2011 (1) 8,000 8,237
New Jersey Econ. Dev. Auth. Rev. VRDO (Hoffman-La Roche
Project) 3.60% 11/2/1999 LOC 6,800 6,800
New Jersey Econ. Dev. Auth. Special Fac. Rev.
(Continental Airlines, Inc. Project) 6.25% 9/15/2019 16,000 15,147
New Jersey Sports & Exposition Auth. Rev. 6.50% 3/1/2013 15,000 16,501
New Jersey Transp. Trust Fund Auth. 6.00% 6/15/2011 (1) 10,000 10,445
Port Auth. of New York & New Jersey Structure Obligation VRDO 3.45% 11/2/1999 1,300 1,300
-----------
98,873
-----------
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FACE MARKET
MATURITY AMOUNT VALUE*
COUPON DATE (000) (000)
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
NEW YORK (9.1%)
Long Island NY Power Auth. Electric System Rev. 0.00% 12/1/2006 (4) $ 5,000 $ 3,496
Long Island NY Power Auth. Electric System Rev. VRDO 3.45% 11/3/1999 LOC 5,900 5,900
Metro. NY Transit Auth. Rev. (Dedicated Petroleum Tax) 6.00% 4/1/2020 (1) 18,000 18,340
Metro. NY Transit Auth. Rev. (Service Contract) 7.375% 7/1/2008 22,870 25,447
Metropolitan Transp. Auth. Transit Fac. Rev. 6.00% 7/1/2019 + 30,855 30,432
Metropolitan Transp. Auth. Transit Fac. Rev. 6.00% 7/1/2024 + 13,000 12,753
New York City NY Muni. Water Finance Auth.
Water & Sewer System Rev. 5.50% 6/15/2020 25,000 23,418
New York State Dormitory Auth. Rev. (City Univ.) 6.375% 7/1/2008 1,340 1,412
New York State Dormitory Auth. Rev. (City Univ.) 7.50% 7/1/2010 5,500 6,238
New York State Dormitory Auth. Rev. (State Univ.) 5.375% 5/15/2007 (2) 2,100 2,145
New York State Dormitory Auth. Rev. (State Univ.) 7.50% 5/15/2013 11,500 13,423
New York State Energy Research & Dev. Auth. VRDO
(Consolidated Edison) 3.50% 11/3/1999 5,300 5,300
New York State Housing Finance Agency Auth. Rev.
(Nursing Home & Health Care) 4.90% 11/1/2010 (1) 9,890 9,297
New York State Housing Finance Agency Auth. Rev.
(Nursing Home & Healthcare) 5.00% 11/1/2011 8,900 8,408
New York State Housing Finance Agency Auth. Rev.
(Nursing Home & Healthcare) 5.10% 11/1/2012 10,895 10,277
New York State Local Govt. Assistance Corp. 6.00% 4/1/2016 6,400 6,464
New York State Local Govt. Assistance Corp. 6.50% 4/1/2001 (Prere.) 16,110 16,924
Niagara Falls NY COP (High School Fac.) 5.875% 6/15/2019 (1) 9,000 8,922
Port Auth. of New York & New Jersey Special Obligation Rev.
(JFK International Airport) 6.25% 12/1/2008 (1) 4,000 4,265
Suffolk County NY IDR (Nissequogue Cogen Partners Fac.) 4.875% 1/1/2008 1,500 1,413
Suffolk County NY IDR (Nissequogue Cogen Partners Fac.) 5.30% 1/1/2013 1,750 1,621
Suffolk County NY IDR (Nissequogue Cogen Partners Fac.) 5.50% 1/1/2023 6,500 5,729
Triborough Bridge & Tunnel Auth. NY Rev.
(Convention Center Project) 7.25% 1/1/2010 13,500 15,041
Triborough Bridge & Tunnel Auth. NY Rev.
(General Purpose Rev.) 5.00% 1/1/2024 5,000 4,298
Triborough Bridge & Tunnel Auth. NY Rev.
(General Purpose Rev.) 5.25% 1/1/2028 12,325 10,892
Triborough Bridge & Tunnel Auth. NY Rev.
(General Purpose Rev.) 5.50% 1/1/2017 10,000 9,707
-----------
261,562
-----------
NORTH CAROLINA (0.7%)
New Hanover County NC Hosp. Rev.
(New Haven Regional Medical Center Project) 5.75% 10/1/2016 (2) 12,500 12,274
North Carolina Eastern Muni. Power Agency Rev. 6.50% 1/1/2018 (ETM) 6,665 7,208
-----------
19,482
-----------
OHIO (4.0%)
Butler County OH Transp. Improvement Dist. Rev. 5.125% 4/1/2017 (4) 5,000 4,552
Butler County OH Transp. Improvement Dist. Rev. 5.50% 4/1/2009 (4) 3,000 3,075
Hamilton County OH Hosp. Fac. Rev. VRDO
(Health Alliance of Greater Cincinnati) 3.45% 11/3/1999 (1) 4,100 4,100
Lucas County OH Hosp. Fac. Rev. (Flower Memorial Hosp.) 8.125% 12/1/2001 (Prere.) 8,900 9,722
Montgomery County OH Hosp. Fac. Rev. (Grandview Hosp.) 5.20% 12/1/2006 (9) 5,000 4,994
Montgomery County OH Hosp. Fac. Rev. (Grandview Hosp.) 5.25% 12/1/2004 (9) 2,250 2,265
Montgomery County OH Hosp. Fac. Rev. (Grandview Hosp.) 5.35% 12/1/2008 (9) 4,615 4,557
Montgomery County OH Hosp. Fac. Rev. (Grandview Hosp.) 5.375% 12/1/2005 (9) 2,400 2,418
Montgomery County OH Hosp. Fac. Rev. (Grandview Hosp.) 5.40% 12/1/2009 (9) 3,850 3,785
Montgomery County OH Hosp. Fac. Rev. (Grandview Hosp.) 5.75% 12/1/2007 (9) 3,300 3,368
Ohio Air Quality Dev. Auth. PCR PUT 4.60% 10/1/2003 4,500 4,349
Ohio Water Dev. Auth. PCR PUT (Cleveland Electric) 4.40% 10/1/2000 23,255 23,128
Ohio Water Dev. Auth. PCR PUT (Cleveland Electric) 4.60% 10/1/2003 3,550 3,425
Ohio Water Dev. Auth. PCR PUT (Toledo-Edison) 5.25% 9/1/2002 6,000 5,961
Ohio Water Dev. Auth. PCR PUT (Toledo-Edison) 5.58% 6/15/2004 18,800 18,513
Parma OH Hosp. Improvement Rev.
(Parma Community General Hosp.) 5.35% 11/1/2018 2,500 2,218
Scioto County OH Marine Terminal Fac.
(Norfolk Southern Corp. Project) 5.30% 8/15/2013 14,750 13,466
-----------
113,896
-----------
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FACE MARKET
MATURITY AMOUNT VALUE*
HIGH-YIELD TAX-EXEMPT FUND COUPON DATE (000) (000)
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
OKLAHOMA (1.5%)
Jackson County OK Memorial Hosp. Auth. Rev.
(Jackson Memorial) 6.75% 8/1/2004 $ 3,555 $ 3,520
Jackson County OK Memorial Hosp. Auth. Rev.
(Jackson Memorial) 7.30% 8/1/2015 4,000 4,048
Norman OK Regional Hosp. Auth. 5.625% 9/1/2016 (1) 4,510 4,323
Oklahoma Dev. Finance Auth. (Hillcrest Hosp.) 5.625% 8/15/2029 36,850 30,343
-----------
42,234
-----------
OREGON (1.7%)
Klamath Falls OR Electric Rev. 5.50% 1/1/2007 11,000 10,491
Klamath Falls OR Electric Rev. 5.75% 1/1/2013 20,000 18,534
Oregon State Department Administrative Services 5.70% 5/1/2016 (2) 4,290 4,530
Portland OR Sewer System Rev. 5.50% 6/1/2017 (1) 15,000 14,475
-----------
48,030
-----------
PENNSYLVANIA (10.6%)
Allegheny County PA Airport Rev.
(Pittsburgh International Airport) 5.75% 1/1/2011 (1) 6,000 6,078
Allegheny County PA Sanitation Auth. Sewer Rev. 6.00% 12/1/2019 (1) 14,630 14,706
Beaver County PA IDA PCR PUT (Cleveland Electric Project) 4.60% 10/1/2003 12,950 12,619
Beaver County PA IDA PCR PUT (Toledo- Edison) 4.85% 6/1/2004 20,850 20,620
Bucks County IDA (Chandler Health Care) 5.70% 5/1/2009 1,800 1,682
Bucks County IDA (Chandler Health Care) 6.20% 5/1/2019 1,250 1,134
Delaware County PA Hosp. Auth. (Crozer Chester Medical Center) 5.125% 12/1/2013 3,400 2,933
Delaware County PA Hosp. Auth. (Crozer Chester Medical Center) 5.30% 12/1/2027 8,905 7,161
Delaware County PA IDA Resource Recovery Rev.
(Browning Ferris) 5.50% 1/1/2002 5,000 4,932
Delaware County PA IDA Resource Recovery Rev.
(Browning Ferris) 6.10% 1/1/2006 5,500 5,335
Delaware County PA IDA Resource Recovery Rev.
(Browning Ferris) 6.10% 7/1/2013 30,500 28,318
Delaware Valley PA Regional Finance Auth. Local Govt. Rev. 5.50% 8/1/2028 (2) 10,000 9,462
Geisinger Health System Auth. of Pennsylvania VRDO
(Penn State Geisinger Health System) 3.60% 11/2/1999 5,600 5,600
Geisinger Health System Auth. of Pennsylvania
(Penn State Geisinger Health System) 5.50% 8/15/2023 27,700 25,822
Langhorne PA Higher Educ. & Health Auth. Rev.
(Lower Bucks Hosp.) 7.30% 7/1/2012 4,500 3,523
Langhorne PA Higher Educ. & Health Auth. Rev.
(Lower Bucks Hosp.) 7.35% 7/1/2022 8,625 6,654
Montgomery County PA Higher Educ. & Health Auth. Rev.
(Brittany Point Project) 8.50% 1/1/2003 (Prere.) 5,000 5,661
Montgomery County PA IDA Pollution Rev. (PECO Energy) 5.20% 10/1/2004 10,000 9,948
Pennsylvania Convention Center Auth. Rev. 6.60% 9/1/2009 (4) 2,500 2,724
Pennsylvania Convention Center Auth. Rev. 6.70% 9/1/2014 (4) 3,500 3,796
Pennsylvania Convention Center Auth. Rev. 6.75% 9/1/2019 (4) 3,695 3,952
Pennsylvania Econ. Dev. Auth. Rev. (Colver Project) 7.05% 12/1/2010 2,500 2,650
Pennsylvania Econ. Dev. Auth. Rev. (Colver Project) 7.125% 12/1/2015 14,000 14,819
Pennsylvania Housing Finance Agency Rev. 7.60% 7/1/2013 10,000 10,544
Pennsylvania Intergovernmental Cooperative Auth. Rev. 5.25% 6/15/2016 7,750 7,174
Philadelphia PA Hosp. & Higher Educ. Fac. Auth. Rev.
(Children's Seashore Hosp.) 7.00% 8/15/2012 3,540 3,735
Philadelphia PA Hosp. & Higher Educ. Fac. Auth. Rev.
(Children's Seashore Hosp.) 7.00% 8/15/2017 1,000 1,055
Philadelphia PA Hosp. & Higher Educ. Fac. Auth. Rev.
(Children's Seashore Hosp.) 7.00% 8/15/2022 500 528
Philadelphia PA Hosp. & Higher Educ. Fac. Auth. Rev.
(Methodist Hosp.) 7.75% 7/1/2004 (Prere.) 11,955 13,535
Philadelphia PA Hosp. & Higher Educ. Fac. Auth. Rev.
(Roxborough Memorial Hosp.) 7.25% 3/1/2024 9,480 9,500
Philadelphia PA Muni. Auth. Rev. 6.125% 7/15/2008 4,000 4,068
Philadelphia PA Muni. Auth. Rev. 6.25% 7/15/2013 5,785 5,834
Philadelphia PA Muni. Auth. Rev. 6.30% 7/15/2017 1,750 1,752
Philadelphia PA Muni. Auth. Rev. 8.625% 11/15/2016 620 663
Philadelphia PA Water & Waste Water Rev. 7.00% 6/15/2011 (3) 21,500 24,341
Schuylkill County PA IDA (Waste Managment) 5.10% 10/1/2019 2,400 2,124
Scranton-Lackawanna PA Health & Welfare (Moses Taylor Hosp.) 8.50% 7/1/2001 (Prere.) 14,375 15,619
Westmoreland County PA IDA (Waste Management) 5.10% 5/1/2018 4,400 3,931
-----------
304,532
-----------
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FACE MARKET
MATURITY AMOUNT VALUE*
COUPON DATE (000) (000)
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
PUERTO RICO (0.2%)
Puerto Rico Electric Power Auth. Rev. 5.25% 7/1/2016 (4) $ 5,000 $ 4,749
-----------
RHODE ISLAND (0.4%)
Rhode Island Convention Center Auth. Rev. 5.75% 5/15/2020 (2) 5,000 4,813
Rhode Island Public Building Auth. 5.25% 2/1/2010 (2) 5,000 4,953
-----------
9,766
-----------
SOUTH CAROLINA (0.2%)
Piedmont SC Muni. Power Agency Rev. 6.25% 1/1/2021 (3) 6,640 6,918
-----------
TENNESSEE (1.0%)
Johnson City TN Health & Educ. Rev.
(Johnson City Medical Center) 5.125% 7/1/2025 (1) 4,000 3,474
Metro. Govt. of Nashville and Davidson County TN
Electric Rev. 5.20% 5/15/2023 20,000 17,720
Springfield TN Health & Educ. Fac. Board Hosp. Rev.
(Northcrest Medical Center) 4.90% 8/1/2008 4,010 3,714
Springfield TN Health & Educ. Fac. Board Hosp. Rev.
(Northcrest Medical Center) 5.25% 8/1/2013 5,450 4,731
-----------
29,639
-----------
TEXAS (8.8%)
Austin TX Airport System Rev. 6.125% 11/15/2025 (1) 38,000 37,730
Austin TX Airport System Rev. 6.45% 11/15/2020 (1) 17,040 17,399
Austin TX Water, Sewer & Electric Rev. 14.00% 11/15/2001 120 131
Austin TX Water, Sewer & Electric Rev. 14.00% 11/15/2001 (ETM) 15 17
Brazos River TX Auth. Rev. (Reliant Energy Inc.) 5.375% 4/1/2019 11,500 9,852
Coastal Bend TX Health Fac. Dev. Corp. Rev. VRDO
(Incarnate Word Health System) 3.55% 11/3/1999 (2) 1,200 1,200
Harris County TX Hosp. Dist. Rev. 7.40% 2/15/2010 (2) 17,500 19,905
Harris County TX Improvement GO 0.00% 10/1/2013 (1) 9,630 4,298
Hidalgo County TX Health Mission Hosp. 6.875% 8/15/2026 7,880 7,993
Houston TX Water & Sewer System Rev. 0.00% 12/1/2004 (2) 12,590 9,792
Houston TX Water & Sewer System Rev. 0.00% 12/1/2011 (2) 24,810 12,606
Houston TX Water & Sewer System Rev. 0.00% 12/1/2012 (2) 26,000 12,333
Houston TX Water & Sewer System Rev. 6.375% 12/1/2017 (2) 4,530 4,658
North Central Texas Health Fac. Dev. Corp. VRDO
(Presbyterian Medical Center) 3.65% 11/2/1999 (1) 700 700
Odessa TX Junior College Dist. Rev. 8.125% 6/1/2005 (Prere.) 10,000 11,678
San Antonio TX Electric & Gas Rev. 5.00% 2/1/2002 (Prere.) 150 153
San Antonio TX Electric & Gas Rev. 5.00% 2/1/2017 3,350 2,976
Texas GO 5.50% 4/1/2002 (Prere.) 40,050 41,752
Texas Muni. Power Agency Rev. 0.00% 9/1/2006 6,205 4,365
Texas TRAN 4.50% 8/31/2000 10,000 10,056
Texas Turnpike Auth. Dallas Northway Rev. 5.50% 1/1/2015 (3) 14,605 14,137
Texas Turnpike Auth. Dallas Northway Rev.
(President George Bush Turnpike) 0.00% 1/1/2011 (2) 7,000 3,744
Tomball TX Hosp. Auth. Rev. 6.00% 7/1/2025 7,400 6,739
Tomball TX Hosp. Auth. Rev. 6.00% 7/1/2029 10,000 9,049
Tyler TX Health Fac. Dev. Corp. (Mother Frances Hosp.) 5.30% 7/1/2007 2,250 2,152
Tyler TX Health Fac. Dev. Corp. (Mother Frances Hosp.) 5.40% 7/1/2008 2,500 2,381
Tyler TX Health Fac. Dev. Corp. (Mother Frances Hosp.) 5.50% 7/1/2009 2,000 1,884
Tyler TX Health Fac. Dev. Corp. (Mother Frances Hosp.) 5.625% 7/1/2013 1,680 1,518
-----------
251,198
-----------
UTAH (1.1%)
Intermountain Power Agency Utah Power Supply Rev. 5.70% 7/1/2017 (1) 12,000 11,694
Intermountain Power Agency Utah Power Supply Rev. 5.75% 7/1/2019 (1) 13,000 12,612
Salt Lake City & County UT Airport Rev. VRDO 3.50% 11/4/1999 LOC 8,200 8,200
-----------
32,506
-----------
VIRGIN ISLANDS (1.1%)
Virgin Islands Public Finance Auth. Rev. 5.20% 10/1/2009 3,065 2,944
Virgin Islands Public Finance Auth. Rev. 5.50% 10/1/2007 6,530 6,517
Virgin Islands Public Finance Auth. Rev. 5.75% 10/1/2013 11,000 10,642
</TABLE>
65
<PAGE> 108
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------
FACE MARKET
MATURITY AMOUNT VALUE*
HIGH-YIELD TAX-EXEMPT FUND COUPON DATE (000) (000)
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Virgin Islands Public Finance Auth. Rev. 5.875% 10/1/2018 $ 6,500 $ 6,197
Virgin Islands Public Finance Auth. Rev. 6.00% 10/1/2008 4,915 4,948
-----------
31,248
-----------
VIRGINIA (2.6%)
Alexandria VA Redev. & Housing Auth. Rev.
(Portals West Project) 9.50% 7/15/2020 -- 9,680 6,098
Charles City County VA IDA Solid Waste Disposal Rev.
(Waste Management Project) 4.875% 2/1/2009 7,750 6,785
Chesterfield County VA Mortgage Rev.
(Brandermill Woods Project) 6.50% 1/1/2028 15,803 14,051
Lynchburg VA IDA Healthcare Facs. Rev. (Centra Health) 5.20% 1/1/2018 4,400 3,902
Lynchburg VA IDA Healthcare Facs. Rev. (Centra Health) 5.20% 1/1/2023 1,000 872
Pocahontas Parkway Assoc. VA Route 5.00% 8/15/2010 (3) 6,100 5,652
Pocahontas Parkway Assoc. VA Route 5.00% 8/15/2011 3,900 3,564
Pocahontas Parkway Assoc. VA Route 5.25% 8/15/2007 4,600 4,471
Pocahontas Parkway Assoc. VA Route 5.25% 8/15/2009 6,000 5,734
Pocahontas Parkway Assoc. VA Route 5.50% 8/15/2028 28,000 23,954
-----------
75,083
-----------
WASHINGTON (1.6%)
Chelan County WA Public Util. Dist. (Rock Island Hydro Project) 0.00% 6/1/2010 (1) 19,550 10,882
Chelan County WA Public Util. Dist. (Rock Island Hydro Project) 0.00% 6/1/2011 (1) 11,400 5,937
Chelan County WA Public Util. Dist. (Rock Island Hydro Project) 0.00% 6/1/2012 (1) 19,650 9,555
Port Auth. of Seattle WA GO 5.75% 5/1/2014 15,600 15,642
Spokane WA Downtown Parking Rev. (River Park Square Project) 5.60% 8/1/2019 6,000 5,285
-----------
47,301
-----------
WEST VIRGINIA (0.3%)
West Virginia Building Comm. Rev. (Jail & Correction Fac.) 7.00% 7/1/2013 (1) 8,390 9,614
-----------
WISCONSIN (1.4%)
Wisconsin Health & Educ. Fac. Auth. Rev.
(Aurora Health Care Inc.) 5.60% 2/15/2029 36,000 30,780
Wisconsin Health & Educ. Fac. Auth. Rev.
(Aurora Health Care Inc.) 5.625% 2/15/2020 9,000 7,943
-----------
38,723
-----------
WYOMING (0.1%)
Lincoln County WY PCR VRDO (Exxon Project) 3.60% 11/2/1999 3,000 3,000
-----------
- ------------------------------------------------------------------------------------------------------------------------------
TOTAL MUNICIPAL BONDS
(COST $2,938,224) 2,885,678
- ------------------------------------------------------------------------------------------------------------------------------
OTHER ASSETS AND LIABILITIES (-0.6%)
- ------------------------------------------------------------------------------------------------------------------------------
Other Assets--Note B 51,379
Liabilities (69,693)
-----------
(18,314)
- ------------------------------------------------------------------------------------------------------------------------------
NET ASSETS (100%)
- ------------------------------------------------------------------------------------------------------------------------------
Applicable to 283,051,693 outstanding $.001 par value shares
of beneficial interest (unlimited authorization) $2,867,364
==============================================================================================================================
NET ASSET VALUE PER SHARE $10.13
==============================================================================================================================
*See Note A in Notes to Financial Statements.
For key to abbreviations and other references, see page 67.
- ------------------------------------------------------------------------------------------------------------------------------
AT OCTOBER 31, 1999, NET ASSETS CONSISTED OF:
- ------------------------------------------------------------------------------------------------------------------------------
AMOUNT PER
(000) SHARE
- ------------------------------------------------------------------------------------------------------------------------------
Paid in Capital $2,949,563 $10.42
Undistributed Net Investment Income -- --
Overdistributed Net Realized Gains--Note E (29,653) (.10)
Unrealized Depreciation--Note F (52,546) (.19)
- ------------------------------------------------------------------------------------------------------------------------------
NET ASSETS $2,867,364 $10.13
==============================================================================================================================
</TABLE>
66
<PAGE> 109
KEY TO ABBREVIATIONS
BAN--Bond Anticipation Note.
COP--Certificate of Participation.
CP--Commercial Paper.
GO--General Obligation Bond.
IDA--Industrial Development Authority Bond.
IDR--Industrial Development Revenue Bond.
PCR--Pollution Control Revenue Bond.
PUT--Put Option Obligation.
RAN--Revenue Anticipation Note.
TAN--Tax Anticipation Note.
TOB--Tender Option Bond.
TRAN--Tax Revenue Anticipation Note.
VRDO--Variable Rate Demand Obligation.
(ETM)--Escrowed to Maturity.
(Prere.)--Prerefunded.
-Non-Income-Producing Security--Interest Payments in Default.
- --Only partial interest was paid on the last interest payment date.
+Security purchased on a when-issued or delayed delivery basis for which the
fund has not taken delivery as of October 31, 1999.
Scheduled principal and interest payments are guaranteed by:
(1) MBIA (Municipal Bond Insurance Association).
(2) AMBAC (Ambac Assurance Corporation).
(3) FGIC (Financial Guaranty Insurance Company).
(4) FSA (Financial Security Assurance).
(5) BIGI (Bond Investors Guaranty Insurance).
(6) Connie Lee Inc.
(7) FHA (Federal Housing Authority).
(8) CapMAC (Capital Markets Assurance Corporation).
(9) American Capital Access Financial Guaranty Corporation.
The insurance does not guarantee the market value of the municipal bonds.
LOC--Scheduled principal and interest payments are guaranteed by bank letter of
credit.
67
<PAGE> 110
REPORT OF INDEPENDENT ACCOUNTANTS
To the Shareholders and Trustees of
Vanguard Municipal Bond Funds
In our opinion, the accompanying statements of net assets and the related
statements of operations and of changes in net assets and the financial
highlights appearing in the Annual Report to Shareholders present fairly, in all
material respects, the financial position of Vanguard Tax-Exempt Money Market
Fund, Vanguard Short-Term Tax-Exempt Fund, Vanguard Limited-Term Tax-Exempt
Fund, Vanguard Intermediate-Term Tax-Exempt Fund, Vanguard Insured Long-Term
Tax-Exempt Fund, Vanguard Long-Term Tax-Exempt Fund and Vanguard High-Yield
Tax-Exempt Fund (separate portfolios of Vanguard Municipal Bond Funds, hereafter
referred to as the "Funds") at October 31, 1999, the results of each of their
operations for the year then ended and the changes in each of their net assets
and the financial highlights for each of the periods indicated, in conformity
with generally accepted accounting principles. These financial statements and
financial highlights (hereafter referred to as "financial statements") are the
responsibility of the Funds' management; our responsibility is to express an
opinion on these financial statements based on our audits. We conducted our
audits of these financial statements in accordance with generally accepted
auditing standards which require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements, assessing the
accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audits, which included confirmation of securities at October 31, 1999 by
correspondence with the custodian and brokers, provide a reasonable basis for
the opinion expressed above.
PricewaterhouseCoopers LLP
Thirty South Seventeenth Street
Philadelphia, Pennsylvania 19103
November 30, 1999
- --------------------------------------------------------------------------------
SPECIAL 1999 TAX INFORMATION (UNAUDITED) FOR
VANGUARD MUNICIPAL BOND FUNDS
This information for the fiscal year ended October 31, 1999, is included
pursuant to provisions of the Internal Revenue Code.
The Short-Term Tax-Exempt Fund, Intermediate-Term Tax-Exempt Fund, Insured
Long-Term Tax-Exempt Fund, Long-Term Tax-Exempt Fund, and High-Yield Tax-Exempt
Fund distributed $154,000, $20,558,000, $12,271,000, $15,507,000 and
$17,896,000, respectively, as capital gain dividends (from net long-term capital
gains) to shareholders in December 1998, all of which is designated as a 20%
rate gain distribution.
Each fund designates 100% of its income dividends as exempt-interest
dividends.
- --------------------------------------------------------------------------------
68
F950-12/21/1999
