<PAGE>
PAGE 1
IDS High Yield Tax-Exempt Fund
1995 annual report
(prospectus enclosed)
(Icon of) Shield with basket of apples enclosed
The goal of IDS High Yield Tax-Exempt Fund, Inc. is to provide high
yield generally exempt from federal income taxes.
(This annual report includes a prospectus that describes in detail
the Fund's objective, investment policies, risks, sales charges,
fees and other matters of interest. Please read the prospectus
carefully before you invest or send money.)
Distributed by American Express Financial Advisors Inc.
<PAGE>
PAGE 2
(Icon of) Shield with basket of apples enclosed
More yield, less taxes
Most of the time, making money means paying taxes. But investors
still can enjoy income that generally is free from federal taxes by
taking advantage of tax-exempt bonds. High Yield Tax-Exempt Fund,
the largest national municipal bond fund, strives to provide the
maximum amount of tax-free income by focusing on municipal bonds
that pay above-average interest. However, certain income may be
subject to state or local or the alternative minimum tax. To
reduce the investment risk, the Fund holds a large, widely
diversified portfolio of bonds providing protection to shareholders
seeking to avoid the impact of default by an individual bond. The
result may be a superior after-tax return for investors in higher
tax brackets.
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PAGE 3
Contents
(Icon of) One open book inside of another.
The purpose of this annual report is to tell investors how the Fund
performed.
The prospectus, which is bound into the middle of this annual
report, describes the Fund in detail.
1995 annual report
From the president 4
From the portfolio manager 4
Ten largest holdings 6
Making the most of your Fund 7
Long-term performance 8
Independent auditors' report 9
Financial statements 10
Notes to financial statements 13
Investments in securities 20
IDS mutual funds 46
Federal income tax information 49
1995 prospectus
The Fund in brief 3p
Goal 3p
Types of Fund investments and their risks 3p
Proposed conversion to master/feeder structure 3p
Manager and distributor 3p
Portfolio manager 3p
Alternative purchase arrangements 3p
Sales charge and Fund expenses 4p
Performance 6p
Financial highlights 6p
Total returns 8p
Yield 10p
Investment policies and risks 11p
Facts about investments and their risks 11p
Valuing Fund shares 17p
How to purchase, exchange or redeem shares 18p
Alternative purchase arrangements 18p
How to purchase shares 21p
How to exchange shares 23p
How to redeem shares 23p
Reductions and waivers of the sales charge 28p
Special shareholder services 33p
Services 33p
Quick telephone reference 33p
Distributions and taxes 34p
Dividend and capital gain distributions 34p
Reinvestments 35p
Taxes 35p
How to determine the correct TIN 38p
How the Fund is organized 39p
Shares 39p
Voting rights 40p
Shareholder meetings 40p
Special considerations regarding
master/feeder structure 41p
Board members and officers 44p
Investment manager and transfer agent 46p
Distributor 47p
About American Express Financial Corporation 49p
General information 49p
Appendices 50p
Description of bond ratings 50p
Tax-exempt vs. taxable income 52p
Descriptions of derivative instruments 54p
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PAGE 4
To our shareholders
(Photo of) William R. Pearce, President of the Fund
(Photo of) Kurt Larson, Portfolio manager
From the president
If you're an experienced investor, you know that 1995 was an
unusually strong year for the U.S. financial markets. Perhaps just
as important, you also know that history shows that bull markets
don't last forever. Though they're often unpredictable, declines -
whether they're brief or long-lasting, moderate or substantial -
are always a possibility.
That fact reinforces the need for investors to review periodically
their long-term goals and assess whether their investment program
remains on track to achieving them. Your quarterly investment
statements are one part of that monitoring process. The other is a
meeting with your American Express financial advisor. That becomes
even more important if there's a major change in your financial
situation or in the financial markets.
William R. Pearce
From the portfolio manager
What a difference a year can make.
In 1994, the bond market suffered through one of its worst years
ever, as rising interest rates drove down prices almost
continually. In 1995, the interest-rate trend reversed direction
and sent bond prices soaring. IDS High Yield Tax-Exempt Fund's
performance reflected the market's recent comeback, as it generated
a total return of nearly 19% (Class A shares) during its fiscal
year - December 1994 through November 1995.
The market's turnaround coincided almost exactly with the beginning
of the Fund's fiscal year. In mid-December, with their fears of
higher inflation abating somewhat, investors began moving
cautiously back into bonds. The increased buying began driving
down long-term interest rates and, in the process, pushing up bond
prices and the net asset value of the Fund.
An extended advance
In a matter of just a few weeks, bond investors' increasing
confidence turned a market upturn into a roaring rally that, except
for a comparatively brief summer slump, lasted through November.
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PAGE 5
In the process, long-term interest rates on municipal bonds fell
nearly one and a half percentage points, settling at 5.8% at
period-end.
The only thing to mar the otherwise excellent investment
environment was talk coming out of Washington regarding tax
reform - specifically, proposals for a flat federal income tax.
Because a flat tax would negate municipal bonds' tax-free-income
advantage, municipals came under some selling pressure at times,
especially during summer. Our view is that major tax reform, if it
ever became a reality, would not be enacted until 1997, at the
earliest.
Successful strategies
Beyond the inherent benefit of falling long-term interest rates,
the Fund's performance also enjoyed a boost from our decision to
lengthen the average maturity of the bonds in the portfolio. This
strategy centered on our belief that interest rates would decline
in 1995. Because a bond's price sensitivity to interest-rate
changes increases with its maturity (for example, a 30-year bond is
more price sensitive than a 10-year bond), we were rewarded even
more by the overall decline in rates.
Another strategy that paid off was to maintain some exposure to
lower-rated bonds, whose prices rose faster than higher-quality
issues. Lastly, we kept a low level of cash reserves, which
offered a meager return compared with what we were able to realize
from our municipal bond holdings.
Looking to the current fiscal year, the environment appears little
changed from several months ago. At this writing, the economy is
still moving forward and inflation remains low. The only notable
difference is that long-term interest rates have come down
substantially since the start of 1995, resulting in uncommonly
strong bond-price appreciation (reflected in the Fund's higher net
asset value). While rates could continue to move down in 1996, we
expect any decline to be less dramatic. Ultimately, that is likely
to mean that the dividend will account for most of the Fund's
return in the months ahead. In the meantime, we will continue to
manage the portfolio with a focus on maintaining an above-average
yield.
Kurt Larson
Class A
12-month performance
(All figures per share)
Net assest value (NAV)
Nov. 30, 1995 $ 4.66
Nov. 30, 1994 $ 4.18
Increase $ 0.48
Distributions
Dec. 1, 1994-Nov. 30, 1995
From income $ 0.28
From capital gains $ --
Total distributions $ 0.28
Total return** +18.6%***
Class B
March 20, 1995-Nov. 30, 1995
(All figures per share)
Net asset value (NAV)
Nov. 30, 1995 $ 4.66
March 20, 1995* $ 4.46
Increase $ 0.20
Distributions
March 20, 1995*-Nov. 30, 1995
From income $ 0.19
From capital gains $ --
Total distributions $ 0.19
Total return** + 8.9%***
Class Y
March 20, 1995-Nov. 30, 1995
(All figures per share)
Net asset value (NAV)
Nov. 30, 1995 $ 4.66
March 20, 1995* $ 4.46
Increase $ 0.20
Distributions
March 20, 1995*-Nov. 30, 1995
From income $ 0.22
From capital gains $ --
Total distributions $ 0.22
Total return** + 9.5%***
*Inception date.
**The prospectus discusses the effect of sales charges, if any,
on the various classes.
***The total return is a hypothetical investment in the Fund with
all distributions reinvested.
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PAGE 6
<TABLE>
<CAPTION>
IDS High Yield Tax-Exempt Fund, Inc.
Your Fund's ten largest holdings
The ten holdings here make up 7.31% of the Fund's net assets
_____________________________________________________________________________________
Percent Value
(of Fund's net assets (as of Nov. 30, 1995)
_____________________________________________________________________________________
<S> <C> <C>
New York City Municipal Water Financial Authority
Water & Sewer System Revenue Bonds Series A
6.25% 2021 .89% $56,799,255
New Hampsire Industrial Development Authority
Pollution Control Revenue Bonds State Public Service
Series 1991B
7.50% 2021 .85 54,650,813
Eastern North Carolina Municipal Power Agency
Power System Refunding Revenue Bonds Series 1991A
5.75% 2019 .83 52,958,400
Northern California Power Agency Geothermal #3
Revenue Bonds
5.00% 2009 .75 47,738,447
Broward County Florida Resource Recovery Revenue Bonds
L.P. South Project
7.95% 2008 .74 47,589,700
Utah Intermountain Power Agency Power Supply Refunding
Revenue Bonds Series 1996C
5.70% 2017 .69 44,334,800
Monroe County Michigan Pollution Control Revenue Bonds
Detroit Edison
7.75% 2019 .69 44,267,755
Puerto Rico Electric Power Agency Revenue Bonds
Series N
6.00% 2010 .63 40,640,800
Texas Alliance Airport Authority Special Facility
Revenue Bonds American Airlines Series 1990
7.50% 2029 .62 39,965,266
Dormitory Authority New York City University System
Consolidated 2nd General Resource Revenue Bonds
Series 1990C
6.00% 2016 .62 39,556,559
</TABLE>
<PAGE>
PAGE 7
Making the most of your Fund
Average annual total return
(as of Nov. 30, 1995)
Class A
1 year 5 years 10 years
+12.71% +7.03% +8.30%
Total returns for Class A, Class B and Class Y for the period from
March 20, 1995 to Nov. 30, 1995 were +3.78%, +3.87% and +9.45%,
respectively. March 20, 1995 was the inception date for Class B
and Class Y. Total return for Class A is shown for comparative
purposes. The performance of Class B and Class Y will vary from
the performance of Class A based on differences in sales charges
and fees.
Your investment and return values fluctuate so that your shares,
when redeemed, may be worth more or less than the original cost.
Figures for Class A and Class B reflect the effect of the maximum
5% sales charge. This was a period of widely fluctuating security
prices. Past performance is no guarantee of future results.
Build your assets systematically
One of the best ways to invest in the Fund is by dollar-cost
averaging -- a time-tested strategy that can make market
fluctuations work for you. To dollar-cost average, simply invest a
fixed amount of money regularly. You'll automatically buy more
shares when the Fund's share price is low, fewer shares when it is
high.
This does not ensure a profit or avoid a loss if the market
declines. But, if you can continue to invest regularly through
changing market conditions, it can be an effective way to
accumulate shares to meet your long-term goals.
How dollar-cost averaging works
Month Amount Per-share Number of shares purchased
invested market price
Jan $100 $20 5.00
Feb 100 18 5.56
Mar 100 17 5.88
Apr 100 15 6.67
May 100 16 6.25
June 100 18 5.56
July 100 17 5.88
Aug 100 19 5.26
Sept 100 21 4.76
Oct 100 20 5.00
(footnotes to table) By investing an equal number of dollars each
month...
(arrow in table pointing to April) you automatically buy more
shares when the per share market price is low.
(arrow in table pointing to September) and fewer shares when the
per share market price is high.
You have paid an average price of only $17.91 per share over the 10
months, while the average market price actually was $18.10.
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PAGE 8
Your Fund's long-term performance
Three ways to benefit from a mutual Fund:
o your shares increase in value when the Fund's investments do
well
o you receive capital gains when the gains on investments sold
by the Fund exceed losses
o you receive income when the Fund's interest and short-term
gains exceed its expenses.
All three make up your total return. And you potentially can
increase your investment if, like most investors, you reinvest your
dividends and capital gain distributions to buy additional shares
of the Fund or another Fund.
Class A*
How your $10,000 has grown in IDS High Yield Tax-Exempt Fund
Average annual total return
(as of Nov. 30, 1995)
1 year 5 years 10 years
+12.71% +7.03% +8.30%
$22,197
High Yield
$20,000 Tax-Exempt Fund
Lehman Muni Index
$9,500
'85 '86 '87 '88 '89 '90 '91 '92 '93 '94 '95
* The graph above is for Class A only. Class B and Class Y are not
shown. Total returns for class A, Class B and Class Y for the
period from March 20, 1995 to Nov. 30, 1995 were +3.78%, +3.87% and
+9.45%, respectively. March 20, 1995 was the inception date for
Class B and Class Y. Total return for Class A is shown for
comparative purposes. The performance of Class B and Class Y will
vary from the performance of Class A based on differences in sales
charges and fees.
Assumes: Holding period from 11/30/85 to 11/30/95. Returns do not
reflect taxes payable on distributions. Reinvestment of all income
and capital gain distributions for the Fund, with a value of
$11,828. Also see "Performance" in the Fund's current prospectus.
Lehman Brothers Municipal Bond Index is made up of a representative
list of general obligation, revenue, insured and prefunded bonds.
The index is frequently used as a general measure of tax-exempt
bond market performance. However, the securities used to create
the index may not be representative of the bonds held in High Yield
Tax-Exempt Fund.
On the graph above you can see how the Fund's total return compared
to a widely cited performance measure, the Lehman Brothers
Municipal Bond Index. In comparing High Yield Tax-Exempt Fund with
this index, you should take into account the fact that the Fund's
performance reflects the maximum sales charge of 5%, while such
charges are not reflected in the performance of the index. If you
were actually to buy either individual bonds or bond mutual funds,
any sales charge that you pay would reduce your total return as
well.
Your investment and return values fluctuate so that your shares,
when redeemed, may be worth more or less than the original cost.
This was a period of widely fluctuating security prices. Past
performance is no guarantee of future results.
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PAGE 9
Independent auditors' report
___________________________________________________________________
The board of directors and shareholders
IDS High Yield Tax-Exempt Fund, Inc.:
We have audited the accompanying statement of assets and
liabilities, including the schedule of investments in securities,
of IDS High Yield Tax-Exempt Fund, Inc. as of November 30, 1995,
and the related statement of operations for the year then ended and
the statements of changes in net assets for each of the years in
the two-year period ended November 30, 1995, and the financial
highlights for each of the years in the four-year period ended
November 30, 1995, the eleven months ended November 30, 1991, and
for each of the years in the five-year period ended December 31,
1990. These financial statements and the financial highlights are
the responsibility of fund management. Our responsibility is to
express an opinion on these financial statements and the financial
highlights based on our audits.
We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements and the financial highlights are free of
material misstatement. An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the
financial statements. Investment securities held in custody are
confirmed to us by the custodian. As to securities purchased and
sold but not received or delivered, we request confirmations from
brokers, and where replies are not received, we carry out other
appropriate auditing procedures. An audit also includes assessing
the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of IDS
High Yield Tax-Exempt Fund, Inc. at November 30, 1995, and the
results of its operations for the year then ended and the changes
in its net assets for each of the years in the two-year period
ended November 30, 1995 and the financial highlights for the
periods stated in the first paragraph above, in conformity with
generally accepted accounting principles.
KPMG Peat Marwick LLP
Minneapolis, Minnesota
January 5, 1996
<PAGE>
PAGE 10
<TABLE>
<CAPTION>
Financial statements
Statement of assets and liabilities
IDS High Yield Tax-Exempt Fund, Inc.
Nov. 30, 1995
_____________________________________________________________________________________________________________
Assets
_____________________________________________________________________________________________________________
<S> <C>
Investments in securities, at value (Note 1)
(identified cost $5,819,390,076) $6,368,385,523
Accrued interest receivable 133,225,662
Receivable for investment securities sold 8,075,387
_____________________________________________________________________________________________________________
Total assets 6,509,686,572
_____________________________________________________________________________________________________________
Liabilities
_____________________________________________________________________________________________________________
Disbursements in excess of cash on demand deposit 8,039,134
Dividends payable to shareholders 3,129,604
Payable for investment securities purchased 85,670,999
Accrued investment management services fee 152,575
Accrued distribution fee 2,892
Accrued service fee 60,851
Accrued transfer agency fee 8,882
Accrued administrative services fee 10,269
Other accrued expenses 414,061
_____________________________________________________________________________________________________________
Total liabilities 97,489,267
_____________________________________________________________________________________________________________
Net assets applicable to outstanding capital stock $6,412,197,305
_____________________________________________________________________________________________________________
Represented by
_____________________________________________________________________________________________________________
Capital stock -- authorized 10,000,000,000 shares of $.01 par value $ 13,770,553
Additional paid-in capital 5,919,751,620
Undistibuted net investment income 6,694
Accumulated net realized loss (Notes 1 and 5) (86,902,133)
Unrealized appreciation (Note 4) 565,570,571
_____________________________________________________________________________________________________________
Total -- representing net assets applicable to outstanding capital stock $6,412,197,305
_____________________________________________________________________________________________________________
Net assets applicable to outstanding shares: Class A $6,315,912,069
Class B $ 71,409,025
Class Y $ 24,876,211
Net asset value per share of outstanding capital stock: Class A shares 1,356,375,237 $ 4.66
Class B shares 15,336,396 $ 4.66
Class Y shares 5,343,662 $ 4.66
_____________________________________________________________________________________________________________
See accompanying notes to financial statements.
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PAGE 11
Financial statements
Statement of operations
IDS High Yield Tax-Exempt Fund, Inc.
Year ended Nov. 30, 1995
_____________________________________________________________________________________________________________
Investment income
_____________________________________________________________________________________________________________
Income:
Interest $ 426,651,811
_____________________________________________________________________________________________________________
Expenses (Note 2):
Investment management services fee 27,955,627
Distribution fee
Class A 340,583
Class B 190,821
Transfer agency fee 2,894,330
Incrementel transfer agency fee - Class B 1,445
Service fee
Class A 7,545,233
Class B 44,512
Administrative services fee 1,291,773
Compensation of directors 154,268
Compensation of officers 55,001
Custodian fees 251,981
Postage 416,409
Registration fees 100,498
Reports to shareholders 239,742
Audit fees 41,250
Administrative 44,577
Other 68,769
_____________________________________________________________________________________________________________
Total expenses 41,636,819
_____________________________________________________________________________________________________________
Earning credits on cash balances (Note 2) (85,528)
_____________________________________________________________________________________________________________
Total net expenses 41,551,291
_____________________________________________________________________________________________________________
Investment income -- net 385,100,520
_____________________________________________________________________________________________________________
Realized and unrealized gain -- net
_____________________________________________________________________________________________________________
Net realized gain on security transactions (Note 3) 9,976,656
Net realized gain on financial futures contracts 1,876,411
_____________________________________________________________________________________________________________
Net realized gain on investments 11,853,067
Net change in unrealized appreciation or depreciation 641,790,089
_____________________________________________________________________________________________________________
Net gain on investments 653,643,156
_____________________________________________________________________________________________________________
Net increase in net assets resulting from operations $1,038,743,676
_____________________________________________________________________________________________________________
See accompanying notes to financial statements.
</TABLE>
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PAGE 12
<TABLE>
<CAPTION>
Financial statements
Statements of changes in net assets
IDS High Yield Tax-Exempt Fund, Inc.
Year ended Nov. 30,
_____________________________________________________________________________________________________________
Operations and distributions 1995 1994
_____________________________________________________________________________________________________________
<S> <C> <C>
Investment income -- net $ 385,100,520 $ 416,298,236
Net realized gain (loss) on investments 11,853,067 (76,837,611)
Net change in unrealized appreciation or depreciation 641,790,089 (714,013,228)
_____________________________________________________________________________________________________________
Net increase (decrease) in net assets resulting from operations 1,038,743,676 (374,552,603)
_____________________________________________________________________________________________________________
Distributions to shareholders from:
Net investment income
Class A (383,035,556) (416,298,458)
Class B (1,365,603) --
Class Y (697,056) --
Net realized gain
Class A -- (30,681,908)
_____________________________________________________________________________________________________________
Total distributions (385,098,215) (446,980,366)
_____________________________________________________________________________________________________________
Capital share transactions (Note 6)
_____________________________________________________________________________________________________________
Proceeds from sales
Class A shares (Note 2) 911,837,002 1,010,567,033
Class B shares 71,192,048 --
Class Y shares 125,163,992 --
Reinvestment of distributions at net asset value
Class A shares 263,493,454 316,177,064
Class B shares 1,122,982 --
Class Y shares 450 --
Payments for redemptions
Class A shares (1,278,436,169) (1,469,116,761)
Class B shares (Note 2) (2,940,998) --
Class Y shares (101,934,182) --
_____________________________________________________________________________________________________________
Decrease in net assets from capital share transactions (10,501,421) (142,372,664)
_____________________________________________________________________________________________________________
Total increase (decrease) in net assets 643,144,040 (963,905,633)
Net assets at beginning of year 5,769,053,265 6,732,958,898
_____________________________________________________________________________________________________________
Net assets at end of year
(including undistributed net investment income of
$6,694 and $0) $6,412,197,305 $5,769,053,265
_____________________________________________________________________________________________________________
See accompanying notes to financial statements.
</TABLE>
<PAGE>
PAGE 13
Notes to financial statements
IDS High Yield Tax-Exempt Fund, Inc.
___________________________________________________________________
1. Summary of significant accounting policies
The Fund is registered under the Investment Company Act of 1940
(as amended) as a diversified, open-end management investment
company. The Fund offers Class A, Class B and Class Y shares.
Class A shares are sold with a front-end sales charge. Class B
shares, which the Fund began offering on March 20, 1995, may be
subject to a contingent deferred sales charge. Class B shares
automatically convert to Class A after eight years. Class Y
shares, which the Fund also began offering on March 20, 1995,
have no sales charge and are offered only to qualifying
institutional investors.
All classes of shares have identical voting, dividend, liquidation
and other rights, and the same terms and conditions, except that
the level of distribution fee, transfer agency fee and service fee
(class specific expenses) differs among classes. Income, expenses
(other than class specific expenses) and realized and unrealized
gains or losses on investments are allocated to each class of
shares based upon its relative net assets.
Significant accounting policies followed by the Fund are summarized
below:
Valuation of securities
All securities are valued at the close of each business day.
Securities for which market quotations are not readily available
are valued at fair value according to methods selected in good
faith by the board of directors. Determination of fair value
involves, among other things, reference to market indexes, matrixes
and data from independent brokers. Short-term securities maturing
in more than 60 days from the valuation date are valued at the
market price or approximate market value based on current interest
rates; those maturing in 60 days or less are valued at amortized
cost.
Option transactions
In order to produce incremental earnings, protect gains, and
facilitate buying and selling of securities for investment
purposes, the Fund may buy and sell put and call options and write
covered call options on the portfolio securities and may write
cash-secured put options. The risk in writing a call option is
that the Fund gives up the opportunity of profit if the market
price of the security increases. The risk in writing a put option
is that the Fund may incur a loss if the market price of the
security decreases and the option is exercised. The risk in buying
an option is that the Fund pays a premium whether or not the option
is exercised. The Fund also has the additional risk of not being
able to enter into a closing transaction if a liquid secondary
market does not exist. The Fund also may write over-the-counter
options where the completion of the obligation is dependent upon
the credit standing of the other party.
<PAGE>
PAGE 14
Option contracts are valued daily at the closing prices on their
primary exchanges and unrealized appreciation or depreciation is
recorded. The Fund will realize a gain or loss upon expiration or
closing of the option transaction. When options on debt securities
or futures are exercised, the Fund will realize a gain or loss.
When other options are exercised, the proceeds on sales for a
written call option, the purchase cost for a written put option or
the cost of a security for a purchased put or call option is
adjusted by the amount of premium received or paid.
Futures transactions
In order to gain exposure to or protect itself from changes in the
market, the Fund may buy and sell interest rate futures contracts.
Risks of entering into futures contracts and related options
include the possibility that there may be an illiquid market and
that a change in the value of the contract or option may not
correlate with changes in the value of the underlying securities.
Upon entering into a futures contract, the Fund is required to
deposit either cash or securities in an amount (initial margin)
equal to a certain percentage of the contract value. Subsequent
payments (variation margin) are made or received by the Fund each
day. The variation margin payments are equal to the daily changes
in the contract value and are recorded as unrealized gains and
losses. The Fund recognizes a realized gain or loss when the
contract is closed or expires.
Securities purchased on a when-issued basis
Delivery and payment for securities that have been purchased by the
Fund on a forward-commitment or when-issued basis can take place
one month or more after the transaction date. During this period,
such securities are subject to market fluctuations, and they may
affect the Fund's net assets the same as owned securities. The
Fund designates cash or liquid high-grade short-term debt
securities at least equal to the amount of its commitment. As of
Nov. 30, 1995, the Fund had entered into outstanding when-issued or
forward commitments of $63,207,971.
Federal taxes
Since the Fund's policy is to comply with all sections of the
Internal Revenue Code applicable to regulated investment companies
and to distribute all of its taxable income to shareholders, no
provision for income or excise taxes is required.
Net investment income (loss) and net realized gains (losses) may
differ for financial statement and tax purposes primarily because
of the deferral of losses on certain futures contracts, the
recognition of certain foreign currency gains (losses) as ordinary
income (loss) for tax purposes, and losses deferred due to "wash
sale" transactions. The character of distributions made during the
year from net investment income or net realized gains may differ
from their ultimate characterization for federal income tax
purposes. Also, due to the timing of dividend distributions, the
fiscal year in which amounts are distributed may differ from the
year that the income or realized gains (losses) were recorded by
the Fund.<PAGE>
PAGE 15
On the statement of assets and liabilities, as a result of
permanent book-to-tax differences, undistributed net investment
income has been increased by $4,389 and accumulated net realized
loss has been increased by $4,389.
Dividends to shareholders
Dividends from net investment income, declared daily and payable
monthly, are reinvested in additional shares of the Fund at net
asset value or payable in cash. Capital gains, when available, are
distributed along with the last income dividend of the calendar
year.
Other
Security transactions are accounted for on the date securities are
purchased or sold. Interest income, including level-yield
amortization of premium and discount, is accrued daily.
___________________________________________________________________
2. Expenses and sales charges
Under terms of a prior agreement that ended March 19, 1995, the
Fund paid AEFC a fee for managing its investments, recordkeeping
and other specified services. The fee was a percentage of the
Fund's average daily net assets consisting of a group asset charge
in reducing percentages from 0.46% to 0.32% annually on the
combined net assets of all non-money market funds in the IDS MUTUAL
FUND GROUP and an individual annual asset charge of 0.11% of
average daily net assets.
Also under terms of the prior agreement, the Fund paid AEFC a
distribution fee at an annual rate of $6 per shareholder account
and a transfer agency fee at an annual rate of $15.50 per
shareholder account.
Effective March 20, 1995, when the Fund began offering multiple
classes of shares, the Fund entered into agreements with AEFC for
managing its portfolio, providing administrative services and
serving as transfer agent as follows: Under its Investment
Management Services Agreement, AEFC determines which securities
will be purchased, held or sold. The management fee is a
percentage of the Fund's average daily net assets in reducing
percentages from 0.49% to 0.36% annually.
Under an Administrative Services Agreement, the Fund pays AEFC for
administration and accounting services at a percentage of the
Fund's average daily net assets in reducing percentages from 0.04%
to 0.02% annually.
Under a separate Transfer Agency Agreement, AEFC maintains
shareholder accounts and records. The Fund pays AEFC an annual fee
per shareholder account for this service as follows:
o Class A $15.50
o Class B $16.50
o Class Y $15.50
<PAGE>
PAGE 16
Also effective March 20, 1995, the Fund entered into agreements
with American Express Financial Advisors Inc. for distribution and
shareholder servicing-related services as follows: Under a Plan and
Agreement of Distribution, the Fund pays a distribution fee at an
annual rate of 0.75% of the Fund's average daily net assets
attributable to Class B shares for distribution-related services.
Under a Shareholder Service Agreement, the Fund pays a fee for
service provided to shareholders by financial advisors and other
servicing agents. The fee is calculated at a rate of 0.175% of the
Fund's average daily net assets attributable to Class A and Class B
shares.
AEFC will assume and pay any expenses (except taxes and brokerage
commissions) that exceed the most restrictive applicable state
expense limitation.
Sales charges received by American Express Financial Advisors Inc.
for distributing Fund shares were $10,966,401 for Class A and
$16,882 for Class B for the year ended Nov. 30, 1995. During the
year ended Nov. 30, 1995, the Fund's custodian and transfer agency
fees were reduced by $85,528 as a result of earnings credits from
overnight cash balances.
The Fund has a retirement plan for its independent directors. Upon
retirement, directors receive monthly payments equal to one-half of
the retainer fee for as many months as they served as directors up
to 120 months. There are no death benefits. The plan is not
funded, but the Fund recognizes the cost of payments during the
time the directors serve on the board. The retirement plan expense
amounted to $74,909 for the year ended Nov. 30, 1995.
___________________________________________________________________
3. Securities transactions
Cost of purchases and proceeds from sales of securities (other than
short-term obligations) aggregated $849,400,189 and $837,487,421,
respectively, for the year ended Nov. 30, 1995. Realized gains and
losses are determined on an identified cost basis.
___________________________________________________________________
4. Interest rate futures contracts
At Nov. 30, 1995, investments in securities included securities
valued at $35,302,175 that were pledged as collateral to cover
initial margin deposits on 3,051 open purchase contracts. The
market value of the open contracts at Nov. 30, 1995 was
$365,410,406 with a net unrealized gain of $16,575,124. The Fund
maintains, in a segregated account with its custodian, securities
with at least a market value equal to the value of these open long
futures contracts.
<PAGE>
PAGE 17
___________________________________________________________________
5. Capital loss carryover
For federal income tax purposes, the Fund has a capital loss
carryover of $37,326,194 at Nov. 30, 1995 that will expire in 2002
if not offset by subsequent capital gains. It is unlikely the
board of directors will authorize a distribution of any net
realized capital gains until the available capital loss carryover
has been offset or expires.
___________________________________________________________________
6. Capital share transactions
Transactions in shares of capital stock for the years indicated are
as follows:
<TABLE>
<CAPTION>
_______________________________________________________________________________________
Year ended Nov. 30, 1995 Year ended
11/30/94
Class A Class B* Class Y* Class A
_______________________________________________________________________________________
<S> <C> <C> <C> <C>
Sold 205,021,043 15,737,180 27,954,933 222,781,222
Issued for reinvested 58,903,368 246,893 100 70,023,194
distributions
Redeemed (288,309,966) (647,677) (22,611,371) (327,007,352)
_______________________________________________________________________________________
Net increase (decrease) (24,385,555) 15,336,396 5,343,662 (34,202,936)
_______________________________________________________________________________________
*Inception date was March 20, 1995.
</TABLE>
7. Financial highlights
"Financial highlights" showing per share data and selected
information is presented on pages 6 and 7 of the prospectus.
<PAGE>
PAGE 18
<TABLE>
<CAPTION>
Investments in securities
IDS High Yield Tax-Exempt Fund, Inc. (Percentages represent value of
Nov. 30, 1995 investments compared to net assets)
_____________________________________________________________________________________________________________________________
Municipal bonds (97.5%)
_____________________________________________________________________________________________________________________________
Name of issuer and title of issue (b,c,j) Coupon Maturity Principal Value(a)
rate amount
_____________________________________________________________________________________________________________________________
<S> <C> <C> <C> <C>
Alabama (1.0%)
Baldwin County Eastern Shore Health Care Authority Hospital Revenue Bonds
Thomas Hospital Series 1991 8.50 % 2016 $ 4,765,000 $ 5,246,932
Camden Industrial Development Board Solid Waste Disposal Revenue Bonds
MacMillan Bloedel Series 1991A A.M.T. 7.75 2019 8,500,000 9,100,355
Columbia Industrial Development Board Pollution Control Revenue Bonds
Alabama Power Farley Plant Series E 9.25 2015 11,500,000 11,731,725
Courtland Industrial Development Board Pollution Control Refunding Bonds
Champion International 6.15 2019 17,000,000 17,209,610
Marengo County Limited Obligation Capital Outlay Warrants Series 1988 8.50 2018 3,000,000 3,415,980
Mobile Industrial Development Board Solid Waste Refunding Revenue Bonds
Mobile Energy Services 6.95 2020 11,250,000 11,826,337
Mobile Medical Clinic Board Psychiatric Revenue Bonds Charter Medical 11.50 2008 2,740,000 2,788,279
______________
Total 61,319,218
_____________________________________________________________________________________________________________________________
Alaska (0.6%)
Anchorage Municipality Senior Lien Electric Revenue Bonds Series 1986
(AMBAC Insured) 6.00 2019 10,150,000 10,179,740
North Slope Borough General Obligation Bonds Series 1984B
Zero Coupon (CGIC Insured) 7.051 2004 7,000,000 (f) 4,600,680
North Slope Borough General Obligation Bonds Series 1984B
Zero Coupon (CGIC Insured) 7.151 2005 7,000,000 (f) 4,336,290
State Finance Housing Authority Series 1995A (MBIA Insured) 5.875 2030 18,500,000 18,539,405
______________
Total 37,656,115
_____________________________________________________________________________________________________________________________
Arizona (0.4%)
Chandler Industrial Development Authority Beverly Enterprises
Series 1994 7.625 2008 2,900,000 3,011,505
Maricopa County Hospital System Revenue Bonds Samaritan Health Services
Series 1981 12.00 2008 4,715,000 5,370,811
Maricopa County Industrial Development Authority Hospital System
Refunding Revenue Bonds Samaritan Health Services Series 1985A 9.25 2015 7,000,000 7,141,050
Maricopa County Pollution Control Refunding Revenue Bonds
Palo Verde Public Service 6.375 2023 3,500,000 3,421,740
Phoenix Civic Improvement Waste Water System
Lease Refunding Revenue Bonds 5.00 2018 5,000,000 4,765,650
Scottsdale Industrial Development Authority Beverly Enterprises
Series 1994 7.625 2008 3,170,000 3,291,887
______________
Total 27,002,643
_____________________________________________________________________________________________________________________________
Arkansas (0.2%)
Pope County Pollution Control Revenue Bonds Arkansas Power & Light
Series 1985 11.00 2015 7,380,000 7,533,283
Pope County Solid Waste Disposal Revenue Bonds Arkansas Power & Light
Series 1991 A.M.T. 8.00 2021 3,250,000 3,544,775
______________
Total 11,078,058
_____________________________________________________________________________________________________________________________
California (7.3%)
Burbank Redevelopment Agency Tax Allocation Bonds
Golden State Series 1993A 6.00 2013-23 9,500,000 9,389,020
Community Development Authority Health Facilities Unihealth America
Certificate of Participation Series 1993 Inverse Floater (AMBAC Insured) 7.215 2011 22,400,000 (d) 23,436,000
East Bay Municipal Utility District Water Revenue Bonds
Series 1993 Inverse Floater (MBIA Insured) 6.67 2008 15,500,000 (d) 15,713,125
Eden Township Hospital District Insured Health Facilities
Refunding Revenue Bonds Certificate of Participation
Eden Hospital Health Services Series 1993 5.85 2018 3,750,000 3,671,625
Foothill Eastern Transportation Corridor Agency Toll Road Revenue Bonds
Series 1995A 5.00 2035 41,070,000 34,474,569
Foothill Eastern Transportation Corridor Agency Toll Road Revenue Bonds
Series 1995A 6.00 2034 32,250,000 31,585,972
Fresno Health Facility Refunding Revenue Bonds
Holy Cross Health System (MBIA Insured) 5.625 2013 3,000,000 3,066,750
<PAGE>
PAGE 19
Los Angeles County Certificate of Participation Inverse Floater 6.708 2015 20,000,000 (d) 19,366,600
Los Angeles County Metropolitan Transportation Authority Proposition C
Sales Tax Revenue Bonds (AMBAC Insured) 5.00 2025 17,750,000 16,656,423
Los Angeles International Airport Regional Airports Improvement
Corporation Refunding Revenue Bonds United Airlines Series 1984 8.80 2021 11,650,000 13,115,687
Los Angeles International Airport Regulatory Airports Improvement
Sublease Revenue Bonds Western Airlines Issue 1985 11.25 2025 10,000,000 10,309,900
Los Angeles Water & Power Electric Plant Refunding Revenue Bonds
Series 1992 6.375 2020 10,000,000 10,589,300
Modesto Santa Clara Redding Public Power Bonds San Juan Series C
(AMBAC Insured) 5.50 2021 4,500,000 4,373,460
Northern California Power Agency Geothermal #3 Revenue Bonds 5.00 2009 49,635,000 47,738,447
Novato Community Facility District #1 Vintage Oaks Public
Improvement Special Tax Refunding Bonds 7.25 2021 5,000,000 5,259,950
Oceanside Certificate of Participation Refunding Bonds
Oceanside Civic Center (MBIA Insured) 5.25 2019 7,000,000 6,796,370
Orange County Special Tax Community Facilities Bonds
Aliso Veijo District 88-1 Series 1992A 7.35 2018 6,000,000 7,119,180
Pleasanton Joint Powers Financing Authority Reassessment
Revenue Bonds Series 1993A 6.15 2012 4,865,000 4,975,435
Regional Airports Improvement Facilities Sublease Revenue Bonds
Continental Airlines Los Angeles International Airport
Series 1988 A.M.T. 9.00 2008-17 12,600,000 13,656,772
Sacramento Cogeneration Authority Revenue Bonds
Proctor & Gamble Series 1995 6.50 2014-21 11,800,000 12,252,910
Sacramento Municipal Utility District Electric Refunding Revenue Bonds
Series R 6.00 2015-17 20,385,000 20,390,552
Sacramento Municipal Utility District Electric Refunding Revenue Bonds
Series 1993D Inverse Floater (FSA Insured) 6.47 2005 15,800,000 (d) 17,202,250
Sacramento Municipal Utility District Electric Refunding Revenue Bonds
Series 1993D Inverse Floater (FSA Insured) 6.67 2006 16,400,000 (d) 17,712,000
Sacramento Municipal Utility District Electric Refunding Revenue Bonds
Series 1993D Inverse Floater (MBIA Insured) 7.12 2015 15,000,000 (d) 14,943,750
San Joaquin Hills Orange County Transportation Corridor Agency
Senior Lien Toll Road Revenue Bonds 6.75 2032 14,785,000 15,352,744
San Jose Redevelopment Agency Merged Area Tax Allocation Bonds
Series 1993 Inverse Floater (MBIA Insured) 5.591 2014 30,600,000 (d) 30,561,750
San Marcos Public Facility Authority Refunding Revenue Bonds
Civic Center Public Improvement Series A 6.20 2022 12,300,000 12,125,094
Sierra Unified School District Fresno County Certificate of Participation
Capital Financing Refunding Bonds Series 1993 6.125 2018 6,470,000 6,476,599
Southern California Public Power Authority Power Revenue Bonds
Palo Verde Series 1993 Inverse Floater (FGIC Insured) 6.521 2017 20,000,000 (d) 19,225,000
Southern California Public Power Authority Power Revenue Bonds
Series 1986B 5.75 2017 2,025,000 2,024,879
Southern California Public Power Authority Transmission
Refunding Revenue Bonds Series 1986B 7.00 2022 1,500,000 1,566,080
South Tahoe Joint Power Financing Authority Refunding Revenue Bonds
South Tahoe Area #1 Series 1995B 6.00 2028 4,500,000 4,325,265
Ukiah Unified School District Mendocino County
Certificate of Participation Series 1993 6.00 2010 5,000,000 5,033,250
University of California Refunding Revenue Bonds
Multiple Purpose Project (AMBAC Insured) 5.25 2016 6,000,000 5,866,020
______________
Total 466,352,728
_____________________________________________________________________________________________________________________________
Colorado (5.1%)
Arapahoe County Capital Improvement Trust Fund E-470 Highway Revenue Bonds 7.00 2026 19,000,000 20,480,290
Arapahoe County Industrial Development Revenue Bonds
Dillion Real Estate-Kroger 8.00 2009 4,000,000 4,398,040
Aurora Centretech Metropolitan District Arapahoe County Series 1987B 6.00 2023 5,732,785 4,458,903
Briargate Public Building Authority Landowner Assessment Lien Bonds
Series 1985A 10.25 2000 5,000,000 (e) 3,000,000
Colorado Health Facility Authorization Revenue Bonds
Escrowed to Maturity Liberty Heights Zero Coupon 7.50 2022 81,465,000 (f) 14,314,215
Colorado Springs Cottonwood General Improvement District
General Obligation Bonds Series 1986 9.25 2031 3,500,000 1,155,000
Colorado Springs Hospital Revenue Bonds Memorial Hospital Series 1990 7.875 2010 5,000,000 5,821,050
Colorado Springs Stetson Hills Public Building Authority
Landowner Assessment Lien Bonds Series 1988A 9.75 2008 2,869,110 (e) 84,639
Colorado Springs Utilities System Refunding Revenue Bonds Series 1991C 6.50 2015 24,895,000 27,034,725
Colorado Springs Utilities System Refunding Revenue Bonds Series 1991C 6.75 2001-21 30,000,000 33,559,298
Colorado Springs Utilities System PreRefunded Revenue Bonds Series 1991C 6.50 2015 1,505,000 1,696,496
Denver City & County Airport Systems Revenue Bonds Series 1991A A.M.T. 8.75 2023 10,000,000 11,844,000
Denver City & County Airport Systems Revenue Bonds Series 1991D A.M.T. 7.75 2021 8,650,000 9,663,347
Denver City & County Airport Systems Revenue Bonds Series 1992A 7.25 2025 20,975,000 22,989,859
Denver City & County Airport Systems Revenue Bonds Series 1992B A.M.T. 7.25 2023 20,500,000 22,186,945
Denver City & County Airport Systems Revenue Bonds Series 1994A A.M.T. 7.50 2013-23 24,340,000 27,021,931
Denver City & County Airport Systems Revenue Bonds Series 1995A
(MBIA Insured) 5.70 2025 20,000,000 20,068,200
<PAGE>
PAGE 20
Denver City & County GVR Metropolitan District
General Obligation Refunding & Improvement Bonds Series 1985 10.25 2002 4,000,000 4,040,720
Denver City & County GVR Metropolitan District
General Obligation Refunding Bonds Series 1991 8.00 2006 1,385,000 1,410,304
Denver City & County GVR Metropolitan District
General Obligation Refunding Bonds Series 1995B 11.00 2006 730,000 704,450
Denver Special Facility Airport Revenue Bonds United Air Lines
Series A A.M.T. 6.875 2032 25,400,000 26,132,790
Denver Urban Renewal Authority Tax Increment Revenue Bonds
South Broadway Montgomery Ward Urban Renewal Series 1992 8.50 2016 14,520,000 15,270,684
Denver West Metropolitan District General Obligation Refunding
Improvement Bonds Series 1995 7.00 2014 4,230,000 4,414,682
El Paso County School District #20 General Obligation Refunding Bonds
Series 1993A 6.10 2005 2,215,000 2,398,181
El Paso County School District #20 General Obligation Refunding Bonds
Series 1993A 6.15 2008 1,000,000 1,078,300
El Paso County School District #20 General Obligation Refunding Bonds
Series 1993A 6.20 2007 1,250,000 1,356,300
Hotchkiss Industrial Development Revenue Bonds Dillion Real Estate-Kroger 8.00 2009 1,500,000 1,652,565
Housing Finance Authority Single Family Program Senior Bonds
Series 1991B (FGIC Insured) 7.25 2011 3,170,000 3,394,626
Housing Finance Authority Single Family Program Senior Bonds
Series 1991B (FGIC Insured) 7.30 2018 2,865,000 3,034,665
Northern Colorado Water District Revenue Bonds Series D 6.00 2015 4,000,000 4,018,080
Superior Metropolitan District #2 Limited Tax General Obligation
Refunding Bonds MDC Holdings Series 1994B 7.50 1998 3,300,000 3,427,314
Superior Metropolitan District #2 Limited Tax General Obligation
Refunding Bonds MDC Holdings Series 1994B 8.25 2013 2,580,000 2,799,558
Superior Metropolitan District #2 Limited Tax General Obligation
Refunding Bonds MDC Holdings Series 1994B 8.50 2013 12,000,000 13,263,720
Thornton Industrial Development Revenue Bonds Dillion Real Estate-Kroger 8.00 2009 4,500,000 4,500,000
Westminster Industrial Development Revenue Bonds Dillion Real Estate-Kroger 8.00 2009 3,500,000 3,848,285
______________
Total 326,522,162
_____________________________________________________________________________________________________________________________
Connecticut (0.1%)
State Transportation Infrastructure Special Tax Obligation Revenue Bonds
Series B 5.70 1997 4,300,000 4,430,204
_____________________________________________________________________________________________________________________________
District of Columbia (1.0%)
General Obligation Refunding Bonds Series A 7.875 2006 12,625,000 13,136,313
General Obligation Refunding Bonds Series 1994A (MBIA Insured) 6.00 2010 27,875,000 28,930,626
General Obligation Refunding Bonds Series 1994A (MBIA Insured) 6.10 2011 7,580,000 7,896,162
General Obligation Refunding Bonds Series 1994B-2 (FSA Insured) 5.50 2006 12,405,000 12,703,216
Housing Finance Agency Multiple Family Mortgage Revenue Bonds
Temple Courts Section 8 Series 1985 (FHA Insured) 12.00 2022 1,320,000 1,485,884
______________
Total 64,152,201
_____________________________________________________________________________________________________________________________
Florida (4.5%)
Broward County Airport System Revenue Bonds Series 1989B A.M.T. 7.625 2013 15,000,000 16,544,700
Broward County Resource Recovery Revenue Bonds L.P. South Project 7.95 2008 42,040,000 47,589,700
Charlotte County Development Authority 1st Mortgage
Refunding Revenue Bonds Royal Palm Retirement Centre Series 1991 9.50 2014 4,230,000 4,507,192
Crossings at Fleming Island Community Development District
Special Assessment Bonds Series 1995 8.25 2016 10,375,000 11,142,543
Crossings at Fleming Island Community Development District Utility
Revenue Bonds Series 1994 7.375 2019 14,000,000 13,958,980
Department of Transportation Turnpike Revenue Bonds Series 1991A
(AMBAC Insured) 6.25 2020 20,000,000 20,907,200
Gateway Centre Development District Pinellas County Special Assessment
Revenue Bonds Series 1988 9.125 2009 2,195,000 2,334,448
Hillsborough County Utility Refunding Revenue Bonds Series 1991A
(MBIA Insured) 6.50 2016 24,760,000 26,843,554
Hillsborough County Utility Refunding Revenue Bonds Series 1991A 7.00 2014 24,000,000 26,045,987
Jacksonville Electric Authority St. John's River Power Park System
Revenue Bonds Series 1989 6.00 2015 10,300,000 10,471,495
Jacksonville Health Facilities Authority Hospital Refunding Revenue Bonds
Riverside Hospital Series 1989 7.625 2013 1,600,000 1,687,872
Lakeland Electric & Water Refunding Revenue Bonds Series 1986 7.00 2009 5,000,000 5,127,500
Lakewood Ranch Community Development District #1 Special Assessment Bonds
Series 1994 8.25 2014 9,105,000 9,591,753
Lee County Industrial Development Authority Industrial Development
Revenue Bonds Gulf Utility Series 1988A A.M.T. 9.625 2018 5,545,000 6,359,228
Lee County Industrial Development Authority Industrial Development
Revenue Bonds Gulf Utilities Series 1988B A.M.T. 9.50 2020 3,970,000 4,540,013
Miami Health Facility Authorization Revenue Bonds
Inverse Floater (AMBAC Insured) 6.37 2015 3,500,000 (d) 3,281,250
Municipal Power Agency Refunding Revenue Bonds St. Lucie Series 1986 7.375 2016 6,000,000 6,308,700
<PAGE>
PAGE 21
Palm Beach County Health Facilities Authority Hospital Revenue Bonds
Good Samaritan Health Series 1993 6.30 2022 4,250,000 4,368,703
Pinellas County Capital Improvement Revenue Bonds Series 1991 5.40 1997 5,570,000 5,719,332
Polk County Industrial Development Authority 1st Mortgage
Refunding Revenue Bonds Spring Haven II 8.75 2014 6,545,000 7,051,452
Port Everglades Port Authority Revenue Bonds Junior Lien 5.00 2016 18,635,000 17,598,894
Riverwood Community Development District Charlotte County
Special Assessment Revenue Bonds Series 1992A 8.50 2012 5,655,000 5,998,880
Riverwood Community Development District Charlotte County
Special Assessment Revenue Bonds Series 1992B 8.50 2012 1,140,000 1,209,323
State Board of Education Refunding Bonds Series 1989A 6.00 2025 16,750,000 16,980,145
Sumter County Village Community Development District #1
Capital Improvement Revenue Bonds Series 1992 8.40 2012 3,790,000 4,018,120
Sunrise Utility System Refunding & Improvement Revenue Bonds 10.75 2018 5,000,000 6,357,700
______________
Total 286,544,664
_____________________________________________________________________________________________________________________________
Georgia (2.3%)
Atlanta Special Purpose Facility Revenue Bonds Delta Air Lines
Series 1989B A.M.T. 6.25 2019 8,685,000 8,642,270
Atlanta Special Purpose Facility Revenue Bonds Delta Air Lines
Series 1989B A.M.T. 7.90 2018 13,500,000 14,474,295
Colquitt County Development Authority Revenue Bonds
Escrowed to Maturity Zero Coupon 6.87 2021 46,350,000 (f) 8,483,904
Effingham County Pollution Control Revenue Bonds Fort Howard
Series 1988 7.90 2005 19,850,000 21,275,230
Fulco Hospital Authority Revenue Anticipation Certificate
Georgia Baptist Health Care Systems Series 1992A 6.375 2022 20,300,000 20,344,660
Municipal Electric Authority Power Refunding Bonds Series 1989R 6.00 2014 9,130,000 9,203,405
Municipal Electric Authority Power Revenue Bonds 6.00 2020 3,350,000 3,349,933
Municipal Electric Authority Power Revenue Bonds 7.00 2019 1,340,000 1,343,913
Municipal Electric Authority Power Revenue Bonds Series 5 (FGIC Insured) 6.00 2025 34,490,000 35,010,454
Municipal Electric Authority Power Revenue Bonds Series L 5.00 2020 1,150,000 1,052,215
Municipal Electric Authority Power Revenue Bonds Series 1986A 7.875 2018 2,625,000 2,686,819
Rockdale County Development Authority Solid Waste Disposal Revenue Bonds
Visy Paper Series 1993 A.M.T. 7.50 2026 10,000,000 10,312,700
Savannah Georgia Economic Development Authority Revenue Bonds
Escrowed to Maturity Zero Coupon 6.87 2021 64,220,000 (f) 11,754,829
______________
Total 147,934,627
_____________________________________________________________________________________________________________________________
Hawaii (0.3%)
City & County of Honolulu Refunding & Improvement
General Obligation Bonds Series 1993B Inverse Floater 6.47 2006 10,000,000 (d) 10,712,500
City & County of Honolulu Refunding & Improvement
General Obligation Bonds Series 1993B Inverse Floater 6.62 2008 10,000,000 (d) 10,725,000
______________
Total 21,437,500
_____________________________________________________________________________________________________________________________
Idaho (--%)
The Regents of the University Student Fee Refunding Revenue Bonds
Series 1986 (FGIC Insured) 7.00 2010 1,050,000 1,071,326
_____________________________________________________________________________________________________________________________
Illinois (8.8%)
Bradley Kankakee County Tax Increment Refunding Revenue Bonds
Series 1993 8.40 2012 5,800,000 6,339,342
Broadview Cook County Senior Lien Tax Increment Revenue Bonds
Series 1993 8.25 2013 12,000,000 13,047,000
Chicago General Obligation Refunding Bonds
Series 1995A (AMBAC Insured) 5.50 2018 20,000,000 (h) 19,500,000
Chicago General Obligation Bonds Series 1991 (AMBAC Insured) 6.00 2016 6,170,000 6,344,549
Chicago General Obligation Bonds Series 1994A (AMBAC Insured) 5.875 2022 17,850,000 18,095,259
Chicago O'Hare International Airport General Airport Revenue Bonds
Series 1990A A.M.T. 6.00 2018 29,000,000 29,203,580
Chicago O'Hare International Airport General Airport Revenue Bonds
Series 1990A A.M.T. 7.50 2016 21,000,000 23,039,730
Chicago O'Hare International Airport General Airport
Refunding Revenue Bonds Series 1993A 5.00 2016 14,450,000 13,527,367
Chicago O'Hare International Airport Special Revenue Facility Bonds
Delta Airlines Series 1992 6.45 2018 10,000,000 10,200,800
Chicago O'Hare International Airport Special Revenue Facility Bonds
United Airlines Series C 8.20 2018 23,665,000 26,048,066
Chicago O'Hare International Airport Terminal Special Revenue Bonds A.M.T. 7.50 2017 32,250,000 35,270,212
Chicago O'Hare International Airport Terminal Special Revenue Bonds
(FGIC Insured) A.M.T. 7.875 2025 17,750,000 19,216,328
Chicago Ridge Special Service Area #1 Unlimited Ad Valorem Tax Bonds
Series 1990 9.00 2008 2,700,000 2,970,108
Chicago Wastewater Transmission Revenue Bonds Series 1994 (MBIA Insured) 6.375 2024 22,500,000 24,000,975
Civic Center Bonds Dedicated Tax Revenue Bonds Series 1985 9.50 2015 10,000,000 10,323,700
<PAGE>
PAGE 22
Cook County Bedford Park Senior Lien Tax Increment Revenue Bonds
Mark IV Series 1992 9.75 2012 1,740,000 1,996,493
Development Finance Authority Pollution Control Refunding Revenue Bonds
Central Illinois Public Service Series 1993B-2 5.90 2028 2,500,000 2,536,300
Development Finance Authority Pollution Control Refunding Revenue Bonds
Commonwealth Edison Series 1994 5.70 2009 2,000,000 2,044,420
Development Finance Authority Pollution Control Refunding Revenue Bonds
Commonwealth Edison Series 1994 5.85 2014 4,500,000 4,315,410
Development Finance Authority Pollution Control Refunding Revenue Bonds
Illinois Power Series 1991A 7.375 2021 19,250,000 21,432,565
Development Finance Authority Pollution Control Revenue Bonds
Illinois Power Series 1986A A.M.T. 7.625 2016 25,000,000 26,369,250
Development Finance Authority Pollution Control Revenue Bonds
Illinois Power Series 1986B A.M.T. 7.625 2016 2,000,000 2,109,540
Development Finance Authority Pollution Control Revenue Bonds
Illinois Power Series 1986C A.M.T. 7.625 2016 15,560,000 16,412,221
Development Finance Authority Retirement Housing Revenue Bonds
Escrowed to Maturity Zero Coupon 7.75 2020 68,000,000 (f) 13,859,080
Development Finance Authority Solid Waste Disposal Facility Revenue Bonds
Ford Heights Waste Tire to Energy Series 1994 A.M.T. 7.875 2011 32,000,000 31,640,000
Educational Facilities Authority Refunding Revenue Bonds
Art Institute of Chicago Series 1993 5.75 2018 1,750,000 1,745,468
Educational Facilities Authority Refunding Revenue Bonds
Art Institute of Chicago Series 1993 5.80 2027 3,350,000 3,340,051
Educational Facilities Authority Refunding Revenue Bonds
Loyola University of Chicago Series 1993 Inverse Floater (FGIC Insured) 6.22 2012 11,000,000 (d) 11,233,750
Granite City Madison County Hospital Refunding Revenue Bonds
St. Elizabeth Medical Center Series 1989A 8.125 2008 3,500,000 3,653,020
Hanover Park Cook & DuPage Counties 1st Mortgage Revenue Bonds
Windsor Park Manor Series 1989 9.50 2014 7,000,000 7,683,620
Health Facilities Authority Refunding Revenue Bonds
Edwards Hospital Series 1993A 6.00 2019 6,350,000 6,263,259
Health Facilities Authority Refunding Revenue Bonds
Masonic Hospital 6.125 2023 3,005,000 2,820,193
Health Facilities Authority Refunding Revenue Bonds
Masonic Medical Center Series 1993 5.50 2019 2,000,000 1,847,720
Health Facilities Authority Refunding Revenue Bonds
Peoria Methodist Medical Center Series 1985A 8.00 2014 4,000,000 4,011,600
Health Facilities Authority Refunding Revenue Bonds
University of Chicago Series 1993 Inverse Floater
(MBIA Insured) 7.32 2014 10,000,000 (d) 10,112,500
Health Facility Authority Revenue Bonds Delnore Community Hospital
Series 1989 8.00 2019 7,000,000 7,956,830
Health Facility Authority Revenue Bonds Sarah Bush Lincoln Health Center
Series 1992 7.25 2012-22 4,000,000 4,212,640
Health Facility Authority Revenue Bonds South Suburban Hospital
Series 1992 7.00 2009-18 9,000,000 9,603,870
Hodgkins General Obligation Tax Increment Bonds Series 1991 9.50 2009 13,000,000 16,058,762
Hodgkins General Obligation Tax Increment Bonds Series 1995C 9.00 2001 1,450,000 1,450,000
Hodgkins General Tax Increment Bonds Series 1995 A 7.625 2013 9,000,000 9,340,560
Jefferson County Housing Development Rome Meadows Elderly Housing
Section 8 8.90 2006 2,000,000 2,022,280
Lansing Cook County Tax Increment Revenue Bonds Series 1987 10.00 2007 10,000,000 10,206,100
Lansing Tax Increment Refunding Revenue Bonds Landings Redevelopment Area
Limited Sales Tax Pledge Series 1992 7.00 2008 10,000,000 11,042,500
Marion General Obligation Hospital Alternate Revenue Source Bonds
Series 1991 7.50 2016 3,800,000 4,127,066
Metropolitan Fair & Exposition Authority Dedicated State Tax
Revenue Bonds 6.00 2014 5,585,000 5,592,372
Metropolitan Pier & Exposition Authority Dedicated State Tax
Refunding Revenue Bonds McCormick Place Zero Coupon (MBIA Insured) 6.61 2017 11,210,000 (f) 3,354,480
Northwest Suburban Water Supply Joint Action Water Agency (MBIA Insured) 5.75 2012 2,000,000 2,000,000
Northwest Water Commission Cook & Lake County Water Revenue Bonds
(MBIA Insured) 6.50 2012 5,025,000 5,309,415
Pekin Pollution Control Revenue Bonds Commonwealth Edison Series 1979B 6.75 2004 2,250,000 2,256,998
Regional Transportation Authority General Obligation Bonds
Counties of Cook, Dupage, Kane, Lake, McHenery and Will
Series 1992A (AMBAC Insured) 6.125 2022 7,200,000 7,415,496
Richland County Hospital Revenue Bonds Richland Memorial Hospital
Series B 10.70 2009 2,000,000 2,040,380
Tinley Park Cook & Will Counties Limited Sales Tax Revenue Bonds
Series 1988 10.25 1999 895,000 (e) 358,000
Tinley Park Cook & Will Counties Unlimited Ad Valorem Tax Bonds
of Special Service 10.65 2007 1,390,000 1,209,300
Robbins Cook County Resource Recovery Revenue Bonds
Robbins Resource Recovery Partners Series 1994A A.M.T. 9.25 2014 18,000,000 19,526,940
Waukegan Pollution Control Revenue Bonds Commonwealth Edison Series B 6.875 2009 5,000,000 5,016,500
______________
Total 562,653,965
_____________________________________________________________________________________________________________________________
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Indiana (3.1%)
Brazil 1st Mortgage Revenue Bonds Hoosier Care II Series 1990 10.375 2020 4,280,000 4,826,342
Carmel Retirement Rental Housing Refunding Revenue Bonds
Beverly Enterprises Series 1992 8.75 2008 7,000,000 (g) 7,807,030
Hammond Multi-School Building 1st Mortgage Bonds
Series 1995 (MBIA Insured) 5.80 2015 3,590,000 3,656,631
Hammond Multi-School Building 1st Mortgage Bonds
Series 1995 (MBIA Insured) 5.85 2020 16,015,000 16,352,596
Hanover 1st Mortgage Revenue Bonds Hoosier Care II Series 1990 10.375 2020 6,995,000 7,779,979
Health Facility Authority Hospital Revenue Bonds
Community Hospital of Anderson Series 1993 6.00 2023 10,000,000 9,725,700
Health Facility Authority Hospital Revenue Bonds Union Hospital
(MBIA Insured) Series 1993 5.125 2018 10,000,000 9,392,300
Indianapolis Resource Recovery Revenue Bonds
Ogden Martin System of Indianapolis Series 1985AB 7.80 2004 9,400,000 9,978,248
Indianapolis Resource Recovery Revenue Bonds
Ogden Martin System of Indianapolis Series 1985B 7.90 2008 2,050,000 2,179,970
Kokomo Hospital Authority Hospital Refunding Revenue Bonds
St. Joseph's Hospital Series 1988A 8.75 2013 5,000,000 5,641,650
La Porte County Hospital Authority Hospital Refunding Revenue Bonds
La Porte Hospital Series 1993 6.00 2023 2,990,000 2,732,561
La Porte County Hospital Authority Hospital Refunding Revenue Bonds
La Porte Hospital Series 1993 6.25 2012 5,070,000 5,018,438
Lawrenceburg Pollution Control Refunding Revenue Bonds
Indiana-Michigan Electric Series E 5.90 2019 8,100,000 7,857,405
Marion County Hospital Authority Hospital Facility Revenue Bonds
Methodist Hospital Series 1989 6.50 2008-13 19,670,000 20,941,298
Muncie Economic Development 1st Mortgage Revenue Bonds
Delaware Advancement Series 1986 A.M.T. 8.25 2016 3,000,000 3,124,890
Municipal Power Agency Power Supply System Refunding Revenue Bonds 5.75 2018 6,470,000 6,469,288
Princeton Pollution Control Revenue Bonds State Public Service Series 1987C
(MBIA Insured) 7.60 2012 16,000,000 16,962,080
Rockport Pollution Control Refunding Revenue Bonds
Indiana-Michigan Electric Series B 7.60 2016 5,500,000 6,041,915
St. Joseph County Hospital Facility Revenue Bonds
Memorial Hospital of South Bend 9.40 2010 2,000,000 2,511,120
Sullivan Pollution Control Refunding Revenue Bonds
Indiana-Michigan Electric Series C 5.95 2009 18,500,000 18,792,115
Vincennes Community School Building 1st Mortgage Refunding Bonds
Series 1986 6.00 2016 10,000,000 10,137,600
Vincennes Economic Development Revenue Bonds Southwest Indiana
Regional Youth Village Facility Series 1993 8.50 2024 16,575,000 17,311,096
______________
Total 195,240,252
_____________________________________________________________________________________________________________________________
Iowa (0.7%)
Iowa City Refunding Revenue Bonds Mercy Hospital Series 1986 6.00 2012 6,300,000 6,339,942
Keokuk Hospital Facilities Refunding Revenue Bonds
Keokuk Area Hospital Series 1991 7.625 2021 5,350,000 5,707,112
Muscatine Electric Refunding Revenue Bonds Series 1986 5.00 2007-08 7,720,000 7,618,337
Muscatine Electric Refunding Revenue Bonds Series 1986 6.00 2005-06 23,280,000 23,302,758
Sioux City Hospital Facility Revenue Bonds
St. Lukes Regional Medical Center 10.875 2013 3,670,000 4,050,873
______________
Total 47,019,022
_____________________________________________________________________________________________________________________________
Kentucky (1.2%)
Development Finance Authority Hospital Facility Revenue Bonds
St. Luke Hospital Series 1989B 6.00 2019 22,695,000 22,214,320
Development Finance Authority Medical Center
Refunding Revenue Improvement Bonds Ashland Hospital Series 1987 9.75 2011 4,000,000 4,489,539
Jefferson County Multi-family Housing Revenue Bonds Brownsboro Gardens
Series 1986A (FHA Insured) A.M.T. 8.00 2026 5,515,000 5,681,718
Louisville Airport Lease Revenue Bonds Series 1989A A.M.T. 7.875 2019 4,000,000 4,441,680
Louisville & Jefferson County Riverport Authority Mortgage Revenue Bonds
Series 1986 A.M.T. 7.875 2016 7,185,000 7,444,307
Louisville Parking Authority of River City PARC 1st Mortgage
Refunding Revenue & Improvement Bonds Series 1985 9.25 2015 5,000,000 5,150,750
McCracken County Revenue Bonds Lourdes Hospital 6.00 2012 8,300,000 8,475,628
Muhlenberg County Hospital Refunding Revenue Bonds
Muhlenberg Community Hospital Series 1988 9.50 2010 4,205,000 4,617,847
Turnpike Authority Economic Road Development Refunding Revenue Bonds
Series 1993 Inverse Floater (AMBAC Insured) 7.006 2012 15,000,000 (d) 15,450,000
______________
Total 77,965,789
_____________________________________________________________________________________________________________________________
Louisiana (3.0%)
Calcasieu Parish Industrial Development Pollution Control
Refunding Revenue Bonds Gulf State Utilities Series 1992 6.75 2012 10,500,000 10,782,555
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Energy & Power Authority Refunding Revenue Bonds Rodemacher Unit #2
Series 1991 (FGIC Insured) 6.00 2013 28,000,000 28,649,600
Hodge Village Combined Utility System Revenue Bonds Stone Container
Series 1990 A.M.T. 9.00 2010 23,000,000 25,228,240
New Orleans Audobon Park Commission Aquarium Revenue Bonds Series 1992A 7.00 1997 1,000,000 1,032,900
New Orleans Audobon Park Commission Aquarium Revenue Bonds Series 1992A 8.00 2012 7,100,000 7,797,930
New Orleans Housing Development Elderly Assisted Tivoli Place Section 8 7.875 2010 1,500,000 1,527,015
Public Facilities Authority Revenue Bonds Alton Ochsner Medical Foundation
Series 1985A 6.00 2005 4,165,000 4,289,867
Public Facilities Authority Revenue Bonds Glen Retirement Systems
Series 1995 6.50 2015 1,000,000 994,470
Public Facilities Authority Revenue Bonds Glen Retirement Systems
Series 1995 6.70 2025 1,500,000 1,488,870
St. Charles Parish Pollution Control Revenue Bonds Louisiana Power & Light
Series 1984 8.25 2014 28,600,000 32,136,390
St. Charles Parish Pollution Control Revenue Bonds Louisiana Power & Light
Series 1991 A.M.T. 7.50 2021 20,700,000 21,801,033
St. Charles Parish Pollution Control Revenue Bonds Louisiana Power & Light
2nd Series 1984 8.00 2014 29,155,000 32,907,831
St. James Parish Pollution Control Revenue Bonds B.F. Goodrich
Series 1981 14.50 2011 500,000 563,425
Southern Louisiana Port Commission Dock & Wharf Facilities B.F. Goodrich 14.50 2011 3,335,000 3,758,045
Southern Louisiana Port Commission Terminal Refunding Revenue Bonds
Gatx Terminal Series 1993 7.00 2023 13,180,000 13,677,413
West Feliciana Parish Demand Pollution Control Revenue Bonds
Gulf State Utilities Series 1985B 9.00 2015 6,000,000 6,848,040
______________
Total 193,483,624
_____________________________________________________________________________________________________________________________
Maine (0.3%)
Bucksport Solid Waste Disposal Revenue Bonds
Champion International Series 1985 6.25 2010 14,185,000 14,378,483
Health & Higher Educational Facilities Authority Revenue Bonds
St. Mary's Hospital Series 1989 8.625 2022 3,500,000 4,035,080
______________
Total 18,413,563
_____________________________________________________________________________________________________________________________
Maryland (0.6%)
Frederick County Economic Refunding Revenue Bonds Alumax Series 1992 7.25 2017 9,880,000 10,414,804
Harford County Industrial Development Revenue Bonds Dorsey 8.00 2005 573,000 574,834
Prince George's County Hospital Revenue Bonds Dimensions Health
Series 1992 7.00 2022 7,000,000 8,135,610
Prince George's County Hospital Revenue Bonds Dimensions Health
Series 1992 7.25 2017 11,400,000 13,410,846
State Transportation Authority Facility Revenue Bonds
Series 1992 Capital Appreciation Zero Coupon (FGIC Insured) 6.33 2010-11 9,700,000 (f) 4,378,277
State Transportation Authority Facility Revenue Bonds
Series 1992 Zero Coupon (FGIC Insured) 6.35 2012 5,000,000 (f) 2,096,350
______________
Total 39,010,721
______________________________________________________________________________________________________________________________
Massachusetts (2.3%)
Bay Transportation Authority Refunding Revenue Bonds
Series 1994A (MBIA Insured) 6.00 2012 8,000,000 8,422,560
Greater Lawrence Sanitary District North Andover
General Obligation Bonds 8.50 2005 4,080,000 4,220,556
Health & Educational Facilities Authority Revenue Bonds
Berkshire Health Systems Series C 5.90 2011 2,000,000 1,865,380
Health & Educational Facilities Authority Revenue Bonds
Berkshire Health Systems Series C 6.00 2020 4,000,000 3,565,920
Health & Educational Facilities Authority Revenue Bonds
Beverly Hospital Inverse Floater (MBIA Insured) 7.27 2020 8,000,000 (d) 8,030,000
Health & Educational Facilities Authority Revenue Bonds
Charlton Memorial Hospital Series B 7.25 2013 6,455,000 6,903,300
Industrial Finance Agency 1st Mortgage Revenue Bonds
Berkshire Retirement Community Lennox Series 1988 9.00 2000 130,000 132,981
Industrial Finance Agency 1st Mortgage Revenue Bonds
Berkshire Retirement Community Lennox Series 1988 9.875 2018 2,800,000 3,005,828
Industrial Finance Agency 1st Mortgage Revenue Bonds
Berkshire Retirement Community Lennox Series 1989 9.875 2018 550,000 590,942
Industrial Finance Agency Pollution Control
Refunding Revenue Bonds Eastern Edison Series 1993 5.875 2008 4,250,000 4,247,322
Industrial Finance Agency Resource Recovery Revenue Bonds
SEMASS Series 1991A 9.00 2015 18,885,000 20,823,923
Industrial Finance Agency Resource Recovery Revenue Bonds
SEMASS Series 1991B A.M.T. 9.25 2015 25,000,000 27,691,250
Municipal Wholesale Electric Power Supply System Revenue Bonds
Series 1992B 6.75 2017 10,130,000 11,629,949
Municipal Wholesale Electric Power Supply System Revenue Bonds
Series 1993A Inverse Floater (AMBAC Insured) 6.72 2018 6,500,000 (d) 6,183,125
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State General Obligation Consolidated Loan Bonds Series 1989
(AMBAC Insured) 6.90 1997 2,500,000 2,612,175
Water Resources Authority General Refunding Revenue Bonds Series 1992B 5.50 2015 22,175,000 21,779,176
Water Resources Authority General Revenue Bonds Series 1992A 6.50 2019 3,500,000 3,939,425
Water Resources Authority General Revenue Bonds Series 1993B
(MBIA Insured) 5.00 2022 10,000,000 9,361,500
______________
Total 145,005,312
_____________________________________________________________________________________________________________________________
Michigan (4.1%)
Crawford County Economic Development Corporation Environmental
Improvement Revenue Bonds Weyerhaeuser Series 1991A 7.125 2007 10,800,000 11,950,524
Detroit Unlimited Tax General Obligation Bonds Series 1993 6.35 2014 6,300,000 6,378,876
Detroit Unlimited Tax General Obligation Bonds Series 1995A 6.80 2015 1,375,000 1,474,798
Lincoln Consolidated School District Unlimited Tax General Obligation
Refunding Bonds (FGIC Insured) 5.85 2018 6,455,000 6,606,305
Midland County Economic Development Corporation Pollution Control Limited
Obligation Refunding Revenue Bonds Midland Cogeneration
Series 1990B A.M.T. 9.50 2009 35,200,000 38,768,928
Midland County Economic Development Corporation Pollution Control Limited
Obligation Refunding Revenue Bonds Midland Cogeneration Series 1990C 8.50 2009 18,900,000 20,262,312
Monroe County Pollution Control Revenue Bonds Detroit Edison A.M.T. 7.75 2019 40,250,000 (g) 44,267,755
Monroe County Pollution Control Revenue Bonds Detroit Edison Series 1985A 10.50 2016 10,000,000 10,301,800
Regents of the University of Michigan Hospital Refunding Revenue Bonds
Series 1986A 7.75 2012 5,000,000 5,298,950
State Hospital Finance Authority Hospital Refunding Revenue Bonds
Detroit Medical Center Series 1993A 6.50 2018 10,000,000 10,370,200
State Hospital Finance Authority Hospital Revenue Bonds
McLaren Obligated Group Series 1991A 7.50 2021 7,500,000 8,814,300
State Hospital Finance Authority Hospital Refunding Revenue Bonds
Sinai Hospital Greater Detroit Series 1995 6.625 2016 2,750,000 2,727,203
State Hospital Finance Authority Hospital Refunding Revenue Bonds
Sinai Hospital Greater Detroit Series 1995 6.70 2026 3,000,000 2,984,370
State Job Development Authority Pollution Control Revenue Bonds Chrysler 5.70 1999 4,350,000 4,518,084
Strategic Fund Limited Obligation Refunding Revenue Bonds Detroit Edison
Series 1995AA (MBIA Insured) 6.40 2025 12,000,000 13,011,120
Strategic Fund Limited Obligation Refunding Revenue Bonds Ford Motor
Series 1991A 7.10 2006 16,400,000 18,696,164
Strategic Fund Limited Obligation Refunding Revenue Bonds
Great Lakes Pulp & Fibre Series 1994 A.M.T. 10.25 2016 35,000,000 37,037,350
Troy City Downtown Development Authority Revenue Bonds
Oakland County Series 1995A 6.375 2018 1,000,000 1,051,570
Van Buren County Downtown Development Authority
Tax Increment Revenue Bonds Series 1994 8.40 2016 4,000,000 4,480,640
Wayne County Special Airport Facilities Refunding Revenue Bonds
Northwest Airlines Series 1995 6.75 2015 11,325,000 11,599,178
______________
Total 260,600,427
_____________________________________________________________________________________________________________________________
Minnesota (3.3%)
Appleton Correctional Facility Revenue Bonds Series 1990A 9.875 2020 15,000,000 (e) 8,550,000
Apple Valley 1st Mortgage Nursing Home Revenue Bonds
Apple Valley Health Care (FHA Insured) 10.50 2012 445,000 513,334
Becker Solid Waste Disposal Facility Revenue Bonds
Liberty Paper Series 1994B A.M.T. 9.00 2015 18,000,000 19,136,160
Bloomington Community Development Refunding Revenue Note
24th Avenue Motel 8.50 2005 1,561,406 1,592,634
Bloomington Health Care Facility Revenue Bonds
Friendship Village of Bloomington Series 1992 8.50 2002 4,785,000 5,274,888
Brainerd Economic Development Authority Health Care Facility Revenue Bonds
Benedictine Health System St. Joseph Medical Center Series 1990 8.375 2020 4,670,000 5,479,218
Duluth Economic Development Authority Health Care Facility Revenue Bonds
Benedictine Health System St. Mary's Medical Center Series 1990 8.375 2020 8,300,000 9,738,224
Duluth Housing & Redevelopment Authority Lakeshore Lutheran Home
1st Mortgage Revenue Bonds 8.00 2000 170,000 169,998
Duluth Housing & Redevelopment Authority Lakeshore Lutheran Home
1st Mortgage Revenue Bonds 8.25 2009 750,000 750,000
Fergus Falls Health Care Facilities Revenue Bonds Series 1995 6.50 2025 1,530,000 1,530,000
International Falls Solid Waste Disposal Revenue Bonds Boise Cascade
Series 1990 A.M.T. 7.75 2015 10,000,000 10,569,600
Maplewood Elder Care Facility Revenue Bonds Care Institute Series 1994 7.75 2024 8,000,000 8,196,320
Maplewood Multifamily Housing Refunding Revenue Bonds
Carefree Cottages Series 1995 AMT 7.20 2032 5,000,000 5,027,300
Mille Lacs Capital Improvement Authority Infrastructure Revenue Bonds
Series 1992A 9.25 2012 4,710,000 5,259,704
Minneapolis Water & Sewer Revenue Bonds Series 1992 5.00 1995 7,800,000 7,800,234
St. Louis Park Health Care Facilities Revenue Bonds
Healthsystem Minnesota Obligated Group Series 1993 Inverse Floater
(AMBAC Insured) 4.825 2005 9,200,000 (d) 8,889,500
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St. Louis Park Health Care Facilities Revenue Bonds
Healthsystem Minnesota Obligated Group Series 1993 Inverse Floater
(AMBAC Insured) 5.825 2013 18,000,000 (d) 16,380,000
St. Louis Park Health Care Park Nicollet Medical Center Facility
Revenue Bonds Series 1990A 9.25 2020 6,000,000 7,200,540
St. Paul Housing & Redevelopment Authority Health Care Facility
Revenue Bonds Lyngblomsten Care Center Series 1993A 7.125 2017 2,840,000 2,927,756
St. Paul Housing & Redevelopment Authority Health Care Facility
Revenue Bonds Lyngblomsten Care Center Series 1993A 9.60 2006 2,025,000 2,198,603
St. Paul Housing & Redevelopment Authority Health Care Facility
Revenue Bonds Lyngblomsten Multi-family Rental Housing Series 1993B 7.00 2024 2,845,000 2,827,304
Southern Minnesota Municipal Power Agency Power Supply System
Refunding Revenue Bonds Series 1986B 7.00 2016 2,000,000 2,045,720
Southern Minnesota Municipal Power Agency Power Supply System
Refunding Revenue Bonds Series 1992 5.75 2018 32,210,000 32,366,541
Southern Minnesota Municipal Power Agency Power Supply System
Revenue Bonds Series 1985A 7.00 2018 8,265,000 8,289,133
Southern Minnesota Municipal Power Agency Power Supply System
Revenue Bonds Series 1985C 7.00 2016 3,885,000 3,896,344
Southern Minnesota Municipal Power Agency Power Supply System
Revenue Bonds Series 1994A Zero Coupon (MBIA Insured) 6.72 2021 13,500,000 (f) 3,476,385
Southern Minnesota Municipal Power Agency Power Supply System
Revenue Bonds Series 1994A Zero Coupon (MBIA Insured) 6.73 2022 17,500,000 (f) 4,263,700
Southern Minnesota Municipal Power Agency Power Supply System
Revenue Bonds Series 1994A Zero Coupon (MBIA Insured) 6.74 2023 27,500,000 (f) 6,340,400
Southern Minnesota Municipal Power Agency Power Supply System
Revenue Bonds Series 1994A Zero Coupon (MBIA Insured) 6.75 2024-27 87,410,000 (f) 17,694,394
______________
Total 208,383,934
_____________________________________________________________________________________________________________________________
Mississippi (1.0%)
Claiborne County Pollution Control Refunding Revenue Bonds
System Energy Resources Series 1995 7.30 2025 4,000,000 4,174,000
Claiborne County Pollution Control Revenue Bonds
Middle South Energy 9.50 2013-16 21,750,000 22,892,393
Claiborne County Pollution Control Revenue Bonds Middle South Energy
Series C 9.875 2014 15,375,000 17,656,496
Harrison County Waste Water Management District Refunding Bonds
Series 1986 5.00 2015 4,250,000 4,082,550
Jackson Industrial Development Revenue Bonds Dorsey 8.00 2005 487,000 493,813
Lowndes County Solid Waste Disposal Pollution Control Revenue Bonds
Weyerhaeuser Series 1989 A.M.T. 7.875 2005 12,250,000 13,411,055
Lowndes County Solid Waste Disposal Pollution Control
Refunding Revenue Bonds Weyerhaeuser Series 1989 Inverse Floater 8.15 2022 4,000,000 (d) 4,538,360
______________
Total 67,248,667
_____________________________________________________________________________________________________________________________
Missouri (0.7%)
Regional Convention & Sports Complex Authority Bonds
St. Louis Sponsor Series 1991B 7.00 2021 5,810,000 6,746,746
Regional Convention & Sports Complex Authority Bonds
St. Louis Sponsor Series 1991C 7.90 2021 2,700,000 3,030,237
State Environment & Improvement Energy Resources Authority
Pollution Control Revenue Bonds Chrysler 5.70 1999 9,250,000 9,456,553
Sikeston Electric System Refunding Revenue Bonds Series 1992
(MBIA Insured) 5.60 2000 4,040,000 4,252,908
Sikeston Electric System Refunding Revenue Bonds Series 1992
(MBIA Insured) 5.80 2002 4,165,000 4,467,337
St. Louis Industrial Development Authority Refunding Revenue Bonds
Kiel Center Multipurposes Arena Series 1992 A.M.T. 7.875 2024 15,400,000 16,362,654
______________
Total 44,316,435
_____________________________________________________________________________________________________________________________
Nebraska (--%)
Omaha Public Power District Electric System Revenue Bonds Series 1986A 6.00 2015 1,370,000 1,447,063
Nevada (0.5%)
Clark County Collateralized Pollution Control Revenue Bonds
State Power A.M.T. 7.80 2009 11,850,000 12,678,789
Clark County Industrial Development Revenue Bonds State Power
Series 1990 A.M.T. 7.80 2020 5,000,000 5,371,800
Humboldt County Collateralized Pollution Control & Water Facilities
Washoe County Hospital Revenue Bonds Washoe Medical Center Series 1989A 7.60 2019 2,750,000 3,075,243
Las Vegas Redevelopment Agency Tax Increment Subordinate Lien
Revenue Bonds Series 1994A 6.00 2010 2,000,000 2,000,700
Las Vegas Redevelopment Agency Tax Increment Subordinate Lien
Revenue Bonds Series 1994A 6.10 2014 2,750,000 2,752,007
Washoe County Hospital Revenue Bonds Washoe Medical Center Series 1993A 6.00 2015 7,250,000 7,307,420
______________
Total 33,185,959
_____________________________________________________________________________________________________________________________
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PAGE 27
New Hampshire (2.6%)
Business Financial Authority Pollution Control Refunding Revenue Bonds
United Illuminating Series 1993A 5.875 2033 13,200,000 12,393,348
Industrial Development Authority Pollution Control Revenue Bonds
State Public Service Series 1991B 7.50 2021 51,485,000 54,650,813
Industrial Development Authority Pollution Control Revenue Bonds
State Public Service Series 1991C A.M.T. 7.65 2021 25,000,000 26,486,000
Industrial Development Authority Pollution Control Revenue Bonds
United Illuminating Series 1987A A.M.T. 9.375 2012 15,000,000 16,552,650
Industrial Development Authority Pollution Control Revenue Bonds
United Illuminating Series 1989A A.M.T. 8.00 2014 8,000,000 8,541,360
State Higher Education & Health Facility Authority Hospital Revenue Bonds
Hitchcock Clinic Series 1994 (MBIA Insured) 6.00 2024 13,000,000 13,389,350
State Higher Education & Health Facility Authority Hospital Revenue Bonds
Mary Hitchcock Memorial Hospital Series 1993 Inverse Floater
(FGIC Insured) 5.22 2013 17,000,000 (d) 16,513,630
State Turnpike System Refunding Revenue Bonds Series 1992 5.75 2020 20,615,000 20,707,973
______________
Total 169,235,124
_____________________________________________________________________________________________________________________________
New Jersey (0.2%)
Economic Development Authority 1st Mortgage Gross Revenue Bonds
Mega Care Union Hospital 8.625 2007 2,500,000 2,731,500
Health Care Facility Finance Authority Revenue Bonds
St. Peter Medical Center Series 1994F (MBIA Insured) 5.00 2016 10,000,000 9,518,000
Health Care Facility Finance Authority Revenue Bonds
Zurbrugg Memorial Hospital Series C 8.50 2012 3,500,000 3,703,770
______________
Total 15,953,270
_____________________________________________________________________________________________________________________________
New Mexico (1.8%)
Albuquerque Airport Revenue Bonds Series 1987B A.M.T. 8.75 2019 15,000,000 16,224,450
Albuquerque Health Care System Revenue Bonds Lovelace Medical Fund 10.25 2011 55,000 55,762
Cibola County Correctional Facility Certificate of Participation
Series 1993 8.50 2015 17,355,000 18,680,922
Farmington Pollution Control Refunding Revenue Bonds State Public Service
San Juan Series 1994A 6.40 2023 30,650,000 30,488,781
Farmington Pollution Control Revenue Bonds State Public Service 6.50 2009 5,935,000 5,935,237
Farmington Pollution Control Revenue Bonds State Public Service San Juan
Series 1978A 6.00 2008 9,105,000 9,031,614
Farmington Power Refunding Revenue Bonds Generating Division 9.875 2013 5,000,000 6,805,900
Las Vegas Hospital Facility Refunding Revenue Bonds
Northeastern Regional Hospital Series 1987 9.625 2013 5,805,000 6,210,073
Lordsberg Pollution Control Refunding Revenue Bonds Phelps Dodge 6.50 2013 20,000,000 21,070,000
______________
Total 114,502,739
_____________________________________________________________________________________________________________________________
New York (7.2%)
Battery Park City Authority Refunding Revenue Bonds
Series 1993A 5.50 2010 9,940,000 9,947,057
Dormitory Authority New York State University Education Facility
Pre-Refunded Revenue Bonds Series 1990A 7.70 2012 10,000,000 11,584,400
Dormitory Authority New York State University Education Facility
Revenue Bonds Series 1993A 5.50 2013 24,530,000 24,124,274
Dormitory Authority New York City University System Consolidated
2nd General Resource Revenue Bonds Series 1990C 5.00 2017 20,820,000 18,783,179
Dormitory Authority New York City University System Consolidated
2nd General Resource Revenue Bonds Series 1990C 6.00 2016 39,465,000 39,556,559
Dormitory Authority New York City University System Consolidated
2nd General Resource Revenue Bonds Series 1990D 7.00 2009 5,000,000 5,731,550
Dormitory Authority New York City University System Consolidated
2nd General Resource Revenue Bonds Series 1994A 5.75 2018 5,500,000 5,506,600
Dormitory Authority New York Court Facility Lease Revenue Bonds
Series 1993A 5.375 2016 11,000,000 10,381,030
Metropolitan Transportation Authority Commuter Facility Revenue Bonds
Series H 6.00 2014 6,150,000 6,161,808
Metropolitan Transportation Authority Transit Facility Revenue Bonds
Series G 6.00 2014 4,970,000 4,979,542
Metropolitan Transportation Transit Facilities Service Contract Series 3 6.00 2019 6,395,000 6,402,226
New York City General Obligation Bonds Series 1992B 7.40 2000 30,000,000 32,641,500
New York City General Obligation Bonds Series 1994B 7.00 2016 16,500,000 18,008,100
New York City Industrial Development Agency Special Facility Revenue Bonds
American Airlines Series 1990 A.M.T. 8.00 2020 16,130,000 17,412,496
New York City Municipal Water Financial Authority Water & Sewer System
Revenue Bonds Series 1994B Inverse Floater (MBIA Insured) 6.32 2009 15,500,000 (d) 15,422,500
New York City Municipal Water Financial Authority Water & Sewer System
Revenue Bonds Series A 6.25 2021 55,500,000 56,799,255
New York City Municipal Water Financial Authority Water & Sewer System
Revenue Bonds Series B 5.00 2017 6,255,000 5,915,729
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PAGE 28
Port Authority Special Project Bonds La Guardia Airport Passenger Terminal
Continental & Eastern Airlines A.M.T. 9.00 2006 2,645,000 2,978,905
Port Authority Special Project Bonds La Guardia Airport Passenger Terminal
Continental & Eastern Airlines Series 2 A.M.T. 9.00 2010 8,800,000 9,927,104
Port Authority Special Project Bonds La Guardia Airport Passenger Terminal
Continental & Eastern Airlines Series 2 A.M.T. 9.125 2015 17,500,000 19,874,225
State Energy Research & Development Authority Electric Facility
Revenue Bonds Consolidated Edison A.M.T. 7.125 2022 10,750,000 11,253,638
State Energy Research & Development Authority Electric Facility
Revenue Bonds Consolidated Edison A.M.T. 7.375 2024 23,000,000 24,626,330
State Energy Research & Development Authority Electric Facility
Revenue Bonds Consolidated Edison A.M.T. 7.50 2021 9,000,000 9,394,920
State Energy Research & Development Authority Electric Facility
Revenue Bonds Consolidated Edison Series 1990A A.M.T. 7.50 2025 30,975,000 33,852,578
State Housing Finance Agency Service Contract Obligation Revenue Bonds
Series 1995A 6.50 2025 12,475,000 13,038,371
State Housing Finance Agency State University Construction
Refunding Bonds Series 1986A 6.50 2013 3,500,000 3,943,695
State Local Government Assistance Corporation Series 1991A 6.50 2020 11,000,000 11,729,630
State Medical Facilities Finance Agency Mental Health Services
Improvement Refunding Revenue Bonds Series 1993D 5.25 2023 15,000,000 13,714,050
State Medical Facilities Finance Agency Mental Health Services
Improvement Refunding Revenue Bonds Series 1993F 5.25 2019 5,790,000 5,330,737
State Urban Development Correctional Facility Refunding Revenue Bonds
Series A 5.50 2016 2,750,000 2,655,868
State Urban Development Correctional Facility Revenue Bonds Series A 7.00 2016 1,800,000 1,841,256
State Urban Development Correctional Facility Revenue Bonds Series B 7.00 2016 10,750,000 10,996,390
______________
Total 464,515,502
_____________________________________________________________________________________________________________________________
North Carolina (4.0%)
Eastern Municipal Power Agency Power Supply System
Refunding Revenue Bonds Series 1993B 6.25 2012 24,655,000 25,236,365
Eastern Municipal Power Agency Power Supply System Revenue Bonds
Series 1985D 7.50 2012 510,000 511,086
Eastern Municipal Power Agency Power System Refunding Revenue Bonds
Series 1986A 4.00 2018 8,675,000 7,099,447
Eastern Municipal Power Agency Power System Refunding Revenue Bonds
Series 1986A 5.00 2017 6,500,000 6,101,784
Eastern Municipal Power Agency Power System Refunding Revenue Bonds
Series 1988A 6.00 2026 3,125,000 3,285,797
Eastern Municipal Power Agency Power System Refunding Revenue Bonds
Series 1989A 5.50 2011 37,800,000 36,520,470
Eastern Municipal Power Agency Power System Refunding Revenue Bonds
Series 1989A 6.50 2024 16,750,000 16,995,722
Eastern Municipal Power Agency Power System Refunding Revenue Bonds
Series 1989A 7.50 2010 29,160,000 34,635,593
Eastern Municipal Power Agency Power System Refunding Revenue Bonds
Series 1991A 5.75 2019 55,000,000 52,958,400
Eastern Municipal Power Agency Power System Refunding Revenue Bonds
Series 1994B 7.25 2007 5,000,000 5,585,600
Eastern Municipal Power Agency Power System Refunding Revenue Bonds
Series B 6.125 2009 10,000,000 10,344,700
Eastern Municipal Power Agency Power System Revenue Bonds
Series 1993D 5.875 2013 2,300,000 2,274,240
Municipal Power Agency #1 Catawba Electric Revenue Bonds Series 1985A 7.00 2020 9,000,000 9,016,917
Municipal Power Agency #1 Catawba Electric Revenue Bonds Series 1985B 8.50 2017 13,000,000 13,314,470
Municipal Power Agency #1 Catawba Electric Revenue Bonds Series 1988 7.00 2016 5,140,000 5,359,735
Municipal Power Agency #1 Catawba Electric Revenue Bonds Series 1993
Inverse Floater (MBIA Insured) 6.72 2012 7,400,000 (d) 7,233,500
Municipal Power Agency #1 Catawba Electric Revenue Bonds Series 1993
Inverse Floater (MBIA Insured) 6.87 2020 15,000,000 (d) 14,643,750
Offiss Incorporation Recreational Facilities Gross Revenue Bonds
Smoky Mountain Golf Course Series 1994 7.50 2019 5,695,000 5,646,422
______________
Total 256,763,998
_____________________________________________________________________________________________________________________________
North Dakota (0.3%)
Fargo Hospital Refunding Revenue & Improvement Bonds Dakota Hospital
Series 1992 6.875 2012 3,000,000 3,465,570
Fargo Hospital Refunding Revenue & Improvement Bonds Dakota Hospital
Series 1992 7.00 2022 4,250,000 4,885,843
General Obligation Bonds Real Estate Series 1986A 6.00 2013 10,000,000 10,217,200
______________
Total 18,568,613
_____________________________________________________________________________________________________________________________
Ohio (2.5%)
Air Quality Development Authority Pollution Control Refunding Revenue Bonds
Ohio Edison Series A 5.95 2029 13,300,000 12,814,683
<PAGE>
PAGE 29
Air Quality Development Authority Pollution Control Revenue Bonds
Cincinnati Gas & Electric 10.125 2015 10,000,000 10,251,700
Air Quality Development Authority Pollution Control Revenue Bonds
Dayton Power & Light 9.50 2015 7,050,000 7,227,378
Air Quality Development Authority Pollution Control Revenue Bonds
Ohio Edison Series 1989A 7.625 2023 6,750,000 7,262,258
Bellefontaine Hospital Facilities Refunding Revenue Bonds
Mary Rutan Health Association Series 1993 6.00 2013 5,330,000 5,148,140
Butler County Hospital Facilities Refunding Revenue & Improvement Bonds
Fort Hamilton-Hughes Memorial Center Series 1991 7.50 2010 8,650,000 9,150,835
Cleveland Parking Facilities Improvement Revenue Bonds Series 1992 8.10 2022 15,000,000 16,440,900
Coshocton County Solid Waste Disposal Refunding Revenue Bonds
Stone Container Series 1992 7.875 2013 17,500,000 18,887,925
Erie County Hospital Improvement & Refunding Revenue Bonds
Firelands Community Hospital Series 1992 6.75 2015 6,540,000 6,845,941
Marion County Health Care Facilities Refunding & Improvement
Revenue Bonds United Church Homes Series 1993 6.30 2015 1,800,000 1,725,120
Marion County Health Care Facilities Refunding & Improvement
Revenue Bonds United Church Homes Series 1993 6.375 2010 2,000,000 2,027,120
Montgomery County Health Facilities Refunding Revenue Bonds
Friendship Village of Dayton Series 1990A 9.25 2016 9,000,000 (e) 9,526,770
Water Development Authority Collateralized Pollution Control
Refunding Revenue Bonds Cleveland Electric Series 1995 7.70 2025 13,000,000 13,662,610
Water Development Authority Collateralized Pollution Control Revenue Bonds
Cleveland Electric Series 1989 A.M.T. 8.00 2023 10,000,000 10,724,500
Water Development Authority Collateralized Pollution Control Revenue Bonds
Toledo Edison Series 1989 A.M.T. 8.00 2023 8,500,000 8,879,695
Water Development Authority Pollution Control Revenue Bonds
Ohio Edison A.M.P. 8.10 2023 10,000,000 10,772,200
Water Development Authority Pollution Control Refunding Revenue Bonds
Toledo Edison Series 1994A A.M.T. 8.00 2023 10,000,000 10,710,000
___________
Total 162,057,775
_____________________________________________________________________________________________________________________________
Oklahoma (1.6%)
Grand River Dam Authority Refunding Revenue Bonds Series 1987 5.00 2012 10,105,000 9,667,150
Hinton Economic Development Authority Certificate of Participation
Series 1994 8.75 2015 12,475,000 13,314,942
Hinton Economic Development Authority Certificate of Participation
Dominion Leasing Series 1990A 9.75 2015 19,090,000 21,357,701
Jackson County Memorial Hospital Authority Hospital
Refunding Revenue Bonds Jackson County Memorial Hospital Series 1994 7.30 2015 6,580,000 6,448,729
Midwest City Memorial Hospital Authority Hospital Revenue Bonds
Series 1992 7.375 2022 7,815,000 8,151,827
Municipal Power Authority Power Supply System Revenue Bonds
Series 1985C 9.625 2023 6,740,000 6,908,702
Oklahoma City Central Oklahoma Transportation & Parking Authority
Parking System Refunding Revenue Bonds Series 1986 (AMBAC Insured) 6.90 2008 8,180,000 8,484,787
Tulsa Municipal Airport Trust Revenue Bonds American Airlines Series 1995 6.25 2020 27,050,000 27,137,912
______________
Total 101,471,750
_____________________________________________________________________________________________________________________________
Oregon (0.5%)
State Veterans Welfare Department Pre-Refunded Bonds Series LXVII 12.40 2000 2,000,000 2,167,740
Western Generation Agency Revenue Bonds Wauna Cogeneration
Series 1994A 7.125 2021 19,200,000 20,121,600
Western Generation Agency Revenue Bonds Wauna Cogeneration
Series 1994B A.M.T. 7.40 2016 9,000,000 9,506,430
______________
Total 31,795,770
_____________________________________________________________________________________________________________________________
Pennsylvania (4.3%)
Alleghany County Industrial Development Authority
Environment Improvement Revenue Bonds USX Corporation Series 1994A 6.70 2020 6,000,000 6,210,300
Beaver County Industrial Development Authority Collateralized Pollution
Control Refunding Revenue Bonds Cleveland Electric Illuminating
Series 1995 7.625 2025 7,500,000 7,985,250
Beaver County Industrial Development Authority Collateralized Pollution
Control Refunding Revenue Bonds Cleveland Electric Illuminating
Series 1995A 7.75 2025 21,150,000 22,744,076
Beaver County Industrial Development Authority Collateralized Pollution
Control Refunding Revenue Bonds Toledo Edison Series 1995A 7.75 2020 14,000,000 15,037,680
Beaver County Industrial Development Authority Pollution Control
Revenue Bonds Toledo Edison-Beaver Valley Series 1995 7.625 2020 11,700,000 12,295,647
Beaver County Industrial Development Authority Pollution Control
Revenue Bonds Ohio Edison 7.75 2024 34,650,000 37,054,017
Butler County Industrial Development Authority Health Care
Refunding Revenue Bonds Pittsburgh Lifetime Care Community Sherwood Oaks
Series 1993 5.75 2011 2,000,000 1,948,020
<PAGE>
PAGE 30
Butler County Industrial Development Authority Health Care
Refunding Revenue Bonds Pittsburgh Lifetime Care Community Sherwood Oaks
Series 1993 5.75 2016 3,000,000 2,864,580
Convention Center Authority Refunding Revenue Bonds Philadelphia
Series 1994A 6.75 2019 5,300,000 5,684,886
Delaware County Authority 1st Mortgage Revenue Bonds
Whitehorse Village Continuing Care Series 1989 9.70 2009-19 11,000,000 12,306,340
Delaware County Industrial Development Authority Pollution Control
Refunding Revenue Bonds Philadelphia Electric Series A 7.375 2021 900,000 976,995
Fayette County Hospital Authority Hospital Refunding Revenue Bonds
Uniontown Hospital Series 1987 7.625 2015 9,000,000 9,377,190
Montgomery County Higher Education and Health Authority
Retirement Community Revenue Bonds G.D.L. Farms Series A 9.50 2020 3,000,000 3,608,370
Philadelphia Airport Revenue Bonds Philadelphia Airport System Series 1985 8.875 2005 1,680,000 1,739,405
Philadelphia Airport Revenue Bonds Philadelphia Airport System Series 1985 9.00 2015 5,750,000 5,952,342
Philadelphia Gas Works Revenue Bonds Series 13 7.70 2021 4,150,000 4,893,348
Philadelphia Hospital & Higher Education Facility Authority Hospital
Revenue Bonds Albert Einstein Medical Center 7.625 2011 15,545,000 16,931,303
Philadelphia Municipal Authority Lease Refunding Revenue Bonds
Series 1993D 6.25 2013 2,500,000 2,546,800
Philadelphia Municipal Authority Lease Refunding Revenue Bonds
Series 1993D 6.30 2017 1,550,000 1,573,312
Philadelphia Water & Sewer Revenue Bonds 12th Series 6.00 2016 10,000,000 10,143,400
Philadelphia Water & Sewer Revenue Bonds 12th Series 7.25 2014 12,000,000 12,375,840
Philadelphia Water & Sewer Revenue Bonds 16th Series 7.00 2018 14,000,000 15,845,200
Philadelphia Water & Sewer Revenue Bonds 16th Series 7.50 2010 13,200,000 15,475,020
Philadelphia Water & Wastewater Revenue Bonds Series 1993 (CGIC Insured) 5.50 2015 11,000,000 10,934,550
Pittsburgh Public Parking Authority Parking System Revenue Bonds
Series 1985 9.50 2007 4,200,000 4,284,672
State Department of General Services Certificate of Participation
Series 1994A (AMBAC Insured) 5.00 2015 25,000,000 23,828,250
Wilkins Industrial Development Authority Revenue Bonds
Retirement Community Longwood at Oakmont Series 1991A 10.00 2021 8,495,000 10,456,388
______________
Total 275,073,181
_____________________________________________________________________________________________________________________________
Puerto Rico (0.7%)
Electric Power Agency Revenue Bonds Series N 6.00 2010 40,000,000 40,640,800
Electric Power Agency Revenue Bonds Series O 6.00 2010 5,305,000 5,389,986
______________
Total 46,030,786
_____________________________________________________________________________________________________________________________
Rhode Island (0.1%)
Public Building Authority Revenue Bonds Series 1994A (AMBAC Insured) 5.25 2007 3,485,000 3,525,182
_____________________________________________________________________________________________________________________________
South Carolina (1.3%)
Cherokee County Spring City Knitting Cluett Peabody 7.40 2009 5,200,000 5,812,144
Greenville County Industrial Development Revenue Bonds
Merscot-Greenville Waste Water Treatment Series 1986A A.M.T. 8.00 2008 8,530,000 8,795,112
Piedmont Municipal Power Agency Electric Refunding Revenue Bonds
Series 1985 7.00 2025 17,430,000 17,480,896
Piedmont Municipal Power Agency Electric Refunding Revenue Bonds
Series 1986B 5.75 2024 7,550,000 7,334,674
Public Service Authority Electric System Expansion Revenue Bonds
Santee Cooper Series 1986D 6.375 2022 2,250,000 2,256,435
Public Service Authority Electric System Expansion Revenue Bonds
Santee Cooper Series 1991D 6.625 2031 14,975,000 17,086,325
Public Service Authority Electric System Revenue Bonds
Santee Cooper Series 1991B 6.00 2031 8,000,000 8,040,880
Public Service Authority Electric System Revenue Bonds
Santee Cooper Series 1993A Inverse Floater (MBIA Insured) 6.893 2013 17,700,000 (d) 17,434,500
______________
Total 84,240,966
_____________________________________________________________________________________________________________________________
South Dakota (0.3%)
Heartland Consumers Power District Electric System
Refunding Revenue Bonds Series 1986 6.00 2010 10,205,000 11,097,938
State Lease Revenue Trust Certificates Series 1993
(CGIC Insured) 6.70 2017 7,260,000 8,458,553
______________
Total 19,556,491
_____________________________________________________________________________________________________________________________
Tennessee (0.4%)
Chattanooga Municipal Improvement & Sewer Facility Unlimited Tax Bonds 6.50 2007 2,000,000 2,091,340
Nashville & Davidson County Health & Education Facility 1st Mortgage
Revenue Bonds Blakeford at Green Hills CCRC 9.25 2024 12,230,000 13,125,725
Knox County Health Education & Housing Facility Hospital Revenue Bonds
Baptist Health System East Tennessee Series 1989 8.60 2016 10,000,000 10,708,700
______________
Total 25,925,765
<PAGE>
PAGE 31
_____________________________________________________________________________________________________________________________
Texas (8.7%)
Alliance Airport Authority Special Facility Revenue Bonds
American Airlines Series 1990 A.M.T. 7.50 2029 37,400,000 39,965,266
Arlington Limited Tax General Obligation Bonds 6.50 2004 1,500,000 1,518,180
Austin Combined Utility Systems Refunding Revenue Bonds Series 1985 10.75 2010-15 12,000,000 15,084,360
Austin Combined Utility Systems Refunding Revenue Bonds Series 1986 5.00 2013 20,000,000 19,020,800
Austin General Obligation Public Improvement Bonds Series 1986 6.75 2006 2,000,000 2,046,940
Austin General Obligation Public Improvement Bonds Series 1986 7.00 2007 5,450,000 5,587,940
Board of Regents of the University System General Refunding Revenue Bonds
Series 1986 6.50 2007 17,500,000 17,929,409
Brazos River Authority Collateralized Pollution Control Revenue Bonds
Texas Utility Electric Series 1989A A.M.T. 8.25 2019 14,000,000 15,525,860
Brazos River Authority Collateralized Pollution Control Revenue Bonds
Texas Utility Electric Series 1990A A.M.T. 8.125 2020 13,205,000 14,737,176
Brazos River Authority Collateralized Pollution Control Revenue Bonds
Texas Utility Electric Series 1991A A.M.T. 7.875 2021 24,450,000 27,384,978
Brazos River Authority Collateralized Refunding Revenue Bonds
Houston Lighting & Power (MBIA Insured) 5.80 2015 15,000,000 15,147,150
Brazos River Authority Collateralized Refunding Revenue Bonds
Houston Lighting & Power Series 1989A 7.625 2019 26,300,000 29,071,231
Brownsville Utility System Priority Revenue Bonds Series 1990
(AMBAC Isured) 6.50 2017 10,015,000 11,138,683
Colony Municipal Utility District #1 Denton County Series 1980 9.25 2007 1,000,000 1,376,730
Dallas & Fort Worth International Airport Special Facility Revenue Bonds
American Airlines Series 1990 A.M.T. 7.50 2025 26,200,000 27,953,828
Dallas & Fort Worth International Airport Special Facility Revenue Bonds
Delta Air Lines Series 1991 A.M.T. 7.125 2026 13,500,000 13,995,180
Denison Hospital Authority Hospital Revenue Bonds
Texoma Medical Center Series 1994 7.10 2024 3,950,000 4,105,551
El Paso Water & Sewer Revenue Bonds 7.00 2003-05 7,100,000 7,160,279
Fort Bend County Municipal Utility District #23 Unlimited Tax Bonds 6.625 2016 3,085,000 3,105,484
Garland Utility System Revenue Bonds Series 1986 6.80 2003 3,335,000 3,361,213
Harris County Health Facilities Development Hospital
Refunding Revenue Bonds Memorial Hospital Series 1985 6.00 2004 6,460,000 6,460,000
Harris County Health Facilities Hospital Revenue Bonds Memorial Hospital
Series 1992 7.125 2015 16,000,000 17,528,960
Harris County Industrial Development Marine Terminal Refunding Revenue Bonds
GATX Terminal Series 1992 6.95 2022 15,000,000 15,838,650
Karnes County Public Facility Lease Revenue Bonds 9.20 2015 15,990,000 16,610,732
Kings Manor Municipal Utility District Waterworks & Sewer Systems
Combination Unlimited Tax & Revenue Bonds Series 1995 6.875 2018 2,470,000 2,582,978
Lower Colorado River Authority Priority Revenue Bonds 7.00 2013 17,000,000 17,049,640
Lower Colorado River Authority Priority Revenue Bonds 9.00 2009 10,000,000 10,245,500
Lower Colorado River Authority Priority Revenue Bonds Series 1985 8.00 2014 2,500,000 2,564,575
Matagorda County Navigation District #1 Collateral Pollution Control
Refunding Revenue Bonds Houston Power & Light (MBIA Insured) 5.80 2015 15,000,000 15,134,100
Matagorda County Navigation District #1 Collateral Pollution Control
Revenue Bonds Central Power & Light Series 1986A (AMBAC Insured) A.M.T. 7.50 2020 6,500,000 7,228,260
Matagorda County Navigation District #1 Collateral Pollution Control
Revenue Bonds Houston Power & Light Series 1986A A.M.T. 7.875 2016 8,000,000 8,422,720
Matagorda County Navigation District #1 Collateral Pollution Control
Revenue Bonds Houston Power & Light Series 1989A A.M.T. 7.875 2019 10,060,000 10,901,117
Matagorda County Navigation District #1 Pollution Control Revenue Bonds
Central Power & Light Series 1986 A.M.T. 7.875 2016 18,000,000 18,886,140
Midland County Hospital District Revenue Bonds Series 1992 7.50 2016 3,025,000 3,259,891
Mills Road Municipal Utility District Harris County Unlimited Tax
Refunding Bonds Series 1993 6.50 2014 2,690,000 2,734,681
Municipal Power Agency Refunding Revenue Bonds (MBIA Insured) 5.25 2009 8,000,000 8,085,360
Municipal Power Agency Revenue Bonds Series 1986 6.50 2014 4,000,000 4,086,520
Municipal Power Agency Revenue Bonds 5.50 2013 7,410,000 7,334,863
Municipal Power Agency Revenue Bonds (BIG Insured) 6.25 2010 13,940,000 14,749,356
North Austin Municipal Utility District #1 Austin Contract Revenue Bonds
Series 1985 9.90 2006-07 2,800,000 3,000,648
North Austin Municipal Utility District #1 Austin Contract Revenue Bonds
Series 1985 10.00 2008-09 2,625,000 2,815,339
North Central Texas Health Facility Development Hospital Revenue Bonds
University Medical Center 8.20 2019 4,245,000 4,489,936
North Central Texas Health Facility Development Hospital Revenue Bonds
University Medical Center Series 1987 7.75 2017 7,500,000 7,806,525
Plano Collin & Denton County General Obligation Bonds Limited Tax
Series 1986 6.00 2006 1,600,000 1,607,776
Rio Grande City Consolidated Independent School District Public Facilities
Lease Revenue Bonds Series 1995 6.75 2010 4,000,000 4,210,680
Sabine River Authority Collateralized Pollution Control Revenue Bonds
Texas Utilities Electric Series 1990A A.M.T. 8.125 2020 30,500,000 33,249,880
San Antonio Electric & Gas System Refunding Revenue Bonds Series 1989B 5.00 2016 11,000,000 10,346,710
San Antonio Electric & Gas System Revenue Bonds Series 1987 5.00 2014 8,680,000 8,194,180
<PAGE>
PAGE 32
West Side Calhoun County Navigation District Solid Waste Disposal
Revenue Bonds Union Carbide Chemical & Plastics Series 1991 A.M.T. 8.20 2021 17,550,000 19,987,344
_____________
Total 560,629,299
_____________________________________________________________________________________________________________________________
Utah (2.0%)
Association Municipal Power System Hunter Series A (AMBAC Insured) 5.50 2012 4,000,000 4,000,000
Carbon County Solid Waste Disposal Refunding Revenue Bonds
Sunnyside Cogeneration Associates Series 1991 A.M.T. 9.25 2018 25,350,000 27,906,801
Housing Finance Agency Single Family Mortgage Senior Bonds Series 1991C
(FGIC Insured) 7.30 2011 1,385,000 1,488,515
Housing Finance Agency Single Family Mortgage Senior Bonds Series 1991C
(FGIC Insured) 7.35 2016 1,100,000 1,176,670
Hurricane Health Facilities Development Revenue Bonds
Mission Health Services Series 1990 10.50 2020 7,770,000 8,924,078
Intermountain Power Agency Power Supply Refunding Revenue Bonds
Series F (AMBAC Insured) 5.00 2013 5,000,000 4,752,700
Intermountain Power Agency Power Supply Refunding Revenue Bonds
Series 1993B Inverse Floater 6.811 2011 7,600,000 (d) 7,628,500
Intermountain Power Agency Power Supply Refunding Revenue Bonds
Series 1996C (MBIA Insured) 5.70 2017 46,000,000 (h) 44,334,800
Intermountain Power Agency Power Supply Revenue Bonds Series 1987A
(MBIA Insured) 5.00 2012 8,000,000 7,685,760
Intermountain Power Agency Power Supply Revenue Bonds Series 1989A 6.00 2023 3,500,000 3,530,030
Intermountain Power Agency Power Supply Revenue Bonds Series 1989B 6.00 2023 10,165,000 10,252,216
Salt Lake City & County General Obligation Public Building Bonds 6.875 2010-11 5,700,000 5,858,118
West Valley City Salt Lake County K mart Industrial Development
Revenue Bonds 10.50 2005 1,450,000 1,493,761
______________
Total 129,031,949
_____________________________________________________________________________________________________________________________
Virginia (0.3%)
Hopewell City Industrial Development Authority Pollution Control
Refunding Revenue Bonds Stone Container Series 1992 8.25 2010 3,170,000 3,477,997
Housing Development Authority Commonwealth Mortgage Bonds Series 1992A 7.15 2033 15,000,000 15,904,200
_____________
Total 19,382,197
_____________________________________________________________________________________________________________________________
Washington (3.7%)
Health Care Facilities Authority Revenue Bonds
Seattle Highline Community Hospital Series 1993 (Connie Lee Insured) 5.50 2014 7,500,000 7,447,425
King County Housing Authority Pooled Housing Refunding Revenue Bonds
Series 1995A 7.20 2026 4,000,000 4,082,840
Longview Industrial Development Corporation Solid Waste Revenue Bonds
Weyerhauser Series 1991 A.M.T. 7.45 2013 20,000,000 21,695,000
Public Power Supply System Nuclear Project #1 Refunding Revenue Bonds
Series A 6.50 2015 21,000,000 22,199,940
Public Power Supply System Nuclear Project #1 Refunding Revenue Bonds
Bonneville Power Administration Series 1993A Inverse Floater
(FSA Insured) 7.17 2011 25,000,000 (d) 26,531,250
Public Power Supply System Nuclear Project #1 Revenue Bonds Series 1989 6.00 2017 28,070,000 28,130,912
Public Power Supply System Nuclear Project #1 Revenue Bonds Series 1990A 6.00 2017 38,875,000 38,980,351
Public Power Supply System Nuclear Project #2 Revenue Bonds Series 1994A 5.375 2011 10,000,000 9,606,900
Public Power Supply System Nuclear Project #2
Revenue Linked Bonds (FGIC Insured) 5.55 2010 20,000,000 20,176,400
Public Power Supply System Nuclear Project #3 Revenue Bonds Series 1989B 5.50 2017-18 27,550,000 26,189,984
Seattle Municipal Light & Power Refunding Revenue Bonds Series 1986 5.875 2010 6,000,000 6,115,140
Snohomish County Public Utility District #1 Generation System
Revenue Bonds Series 1986A 5.00 2020 17,750,000 16,730,263
State Housing Finance Commission Refunding Revenue Bonds
Horizon House Series 1995A (Asset Guaranty Insured) 6.00 2017 3,700,000 3,766,637
State Housing Finance Commission Refunding Revenue Bonds
Horizon House Series 1995A (Asset Guaranty Insured) 6.125 2027 3,600,000 3,669,084
______________
Total 235,322,126
_____________________________________________________________________________________________________________________________
West Virginia (1.7%)
Board of Regents State System Tuition Fee Revenue Bonds University 7.75 2011 8,000,000 8,265,760
Kanawha County Pollution Control Revenue Bonds Union Carbide Series 1984 7.35 2004 3,000,000 3,349,800
Marion County Solid Waste Disposal Facility Revenue Bonds
American Power Paper Recycling Series 1993 A.M.T. 7.75 2011 20,000,000 17,237,600
Marion County Solid Waste Disposal Facility Revenue Bonds
American Power Paper Recycling Series 1994 A.M.T. 8.25 2011 10,000,000 9,027,400
Marion County Solid Waste Disposal Facility Revenue Bonds
American Power Paper Recycling Series 1995 A.M.T. 9.00 2011 5,000,000 4,832,150
Mason County Pollution Control Refunding Revenue Bonds
Appalachian Power Series 1992J 6.60 2022 25,000,000 26,066,750
Pea Ridge Public Service District Sewer Refunding Revenue Bonds
Series 1990 9.25 2020 2,630,000 2,785,670
Putnam County Pollution Control Revenue Bonds Appalachian Power Series C 6.60 2019 10,600,000 11,079,014
<PAGE>
PAGE 33
School Building Authority Capital Improvement Revenue Bonds Series 1991A 6.00 2021 20,785,000 21,247,882
South Charleston Pollution Control Refunding Revenue Bonds Union Carbide
Series 1985 7.625 2005 3,000,000 3,494,910
______________
Total 107,386,936
_____________________________________________________________________________________________________________________________
Wisconsin (0.7%)
Health & Education Facilities Authority Revenue Bonds St. Clare Hospital 7.00 2022 12,115,000 12,930,218
Health Facilities Authority Refunding Revenue Bonds Villa Clement
Series 1986 8.75 2012 4,500,000 4,553,235
Madison Industrial Development Refunding Revenue Bonds
Madison Gas & Electric Series 1992B 6.70 2027 19,300,000 20,595,802
Superior Water Supply Facility Revenue Bonds
Superior Water Light & Power Series 1986 A.M.T. 7.875 2021 6,500,000 6,787,300
______________
Total 44,866,555
_____________________________________________________________________________________________________________________________
Wyoming (0.2%)
Green River & Rock Springs Sweetwater County Joint Powers
Water Board Revenue Bonds Series 1988A 8.50 2007 2,500,000 2,772,250
Natrona County Hospital Revenue Bonds Wyoming Medical Center 8.125 2010 6,500,000 7,082,530
State Farm Loan Board Capital Facilities Revenue Bonds Series 1994 6.10 2024 5,000,000 5,196,450
______________
Total 15,051,230
_____________________________________________________________________________________________________________________________
Total municipal bonds
(Cost: $5,701,378,790) $6,250,363,383
_____________________________________________________________________________________________________________________________
</TABLE>
<TABLE>
<CAPTION>
Short-term securities (1.84%)
_____________________________________________________________________________________________________________________________
Issuer (c,j) Annualized Amount Value(a)
yield on date payable at
of purchase maturity
_____________________________________________________________________________________________________________________________
<S> <C> <C> <C>
Municipal Notes
Breckenridge Health Facility Revenue Bonds (MBIA Insured)
11-15-13 4.00% $ 2,595,000 (i) $ 2,595,000
Burke County Pollution Control Revenue Bonds
Georgia Power & Light V.R.D.B. Series 1994
07-01-24 4.00 7,700,000 (i) 7,700,000
Columbia Alabama Pollution Control Revenue Bonds
Alabama Power V.R.D.B. Series D
10-01-22 3.85 13,200,000 (i) 13,200,000
Emery County Utah Pollution Control Revenue Bonds
Pacificorp V.R.D B. Series 1994
11-01-24 3.70 6,000,000 (i) 6,000,000
Georgia Municipal Electric Authority Bonds
Series C
12-04-95 3.85 10,000,000 10,000,000
Los Angeles Country T.R.A.N.
07-01-96 4.50 7,000,000 7,042,140
Minneapolis Minnesota Special School District (MBIA Insured)
02-01-15 4.00 1,285,000 (i) 1,285,000
Minnesota Housing & Redevelopment Health Care Bonds
Minneapolis & St. Paul Children's Hospital V.R.D.B. Series B
8-15-25 3.75 5,000,000 (i) 5,000,000
Moffat County Colorado Pollution Control Refunding Revenue Bonds
Pacificorp V.R.D.B. Series 1994
05-01-13 3.80 3,000,000 (i) 3,000,000
Monroe County Georgia Development Authority
Pollution Control Revenue Bonds V.R.D.B. Series 1995
09-01-24 4.00 2,200,000 (i) 2,200,000
07-01-25 4.00 5,100,000 (i) 5,100,000
New York City General Obligation Bonds V.R.D.N.
Series B (FGIC Insured)
10-01-22 4.00 3,200,000 (i) 3,200,000
Ohio State Air Quality Development Authority Revenue Bonds
Cincinnati Gas & Electric V.R.D.B. Series B
09-01-30 3.70 10,200,000 (i) 10,200,000
Parish of St. Charles Louisiana Shell Oil Bonds V.R.D.B. Series 1992B
10-01-22 3.70 2,900,000 (i) 2,900,000
Port Arthur District of Jefferson Texas
Pollution Control Revenue Bonds Texaco
10-01-24 3.75 2,000,000 (i) 2,000,000
<PAGE>
PAGE 34
Sabine River Authority Pollutin Control Revenue Utility Notes
V.R.D.N. Series B
06-01-30 4.00 3,600,000 (i) 3,600,000
St. Louis Park Minnesota Health System Revenue Bonds V.R.D.B.
07-01-13 4.00 25,000,000 (i) 25,000,000
Valdez Alaska Marine Terminal Refunding Revenue Bonds
Exxon V.R.D.B. Series 1993A
12-01-33 3.75 8,000,000 (i) 8,000,000
_____________________________________________________________________________________________________________________________
Total short-term securities
(Cost: $118,011,286) $ 118,022,140
_____________________________________________________________________________________________________________________________
Total investments in securities
(Cost: $5,819,390,076)(k) $6,368,385,523
_____________________________________________________________________________________________________________________________
Notes to investments in securities
____________________________________________________________________________________________________________________________
(a) Securities are valued by procedures described in Note 1 to the financial statements.
(b) Investments in bonds, by rating category as a percentage of total bonds, are as follows:
(Unaudited)
__________________________________________
Rating 11-30-95 11-30-94
______________________________________________________________________
AAA 29% 28%
AA 6 7
A 20 23
BBB 27 25
BB and below 18 16
Non-rated 0 1
_______________________________________________________________________
Total 100% 100%
______________________________________________________________________
(c) The following abbreviations are used in portfolio descriptions to identify
the insurer of the issue:
AMBAC -- American Municipal Bond Association Corporation
BIG -- Bond Investors Guarantee
CGIC -- Capital Guaranty Insurance Company
FGIC -- Financial Guarantee Insurance Corporation
FHA -- Federal Housing Authority
FSA -- Financial Security Assurance
MBIA -- Municipal Bond Investors Assurance
(d) Inverse floaters represent securities, that pay interest at a rate that
increases (decreases) in the same magnitude as, or in a multiple of, a
decline (increase) in market short-term rates. Interest rate disclosed
is the rate in effect on Nov. 30, 1995. Inverse floaters in the aggregate
represent 5.8% of the Fund's net assets as of Nov. 30, 1995.
(e) Presently non-income producing. For long-term debt securities items
identified are in default as to payment of interest and/or principal.
(f) For zero coupon bonds, the interest rate disclosed represents the
annualized effective yield on the date of acquisition.
(g) Partially pledged as initial deposit on the following open interest rate
futures contracts (see Note 4 to the financial statements):
Type of security National amount
Purchase contracts
_________________________________________________________________
Municipal Bonds Index Dec. 1995 $ 30,000,000
Dec. 1995 15,100,000
Dec. 1995 85,500,000
U.S. Treasury Bonds Dec. 1995 144,500,000
Dec. 1995 30,000,000
_________________________________________________________________
Total $305,100,000
_________________________________________________________________
(h) At Nov. 30, 1995, the cost of securities purchased on a when-issued basis
was $63,207,971.
(i) Interest rate varies to reflect current market conditions; rate shown is
the effective rate on Nov. 30, 1995.
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PAGE 35
(j) The following abbreviations are used in portfolio descriptions:
T.R.A.N. -- Tax & Revenue Anticipation Note
V.R.D.B. -- Variable Rate Demand Bond
V.R.D.N. -- Variable Rate Demand Note
A.M.T. -- Alternative Minimum Tax - As of Nov. 30, 1995, the value of
securities subject to alternate minimum tax represented 19.59%
of net assets.
(k) At Nov. 30, 1995, the cost of securities for federal income tax purposes was
$5,814,291,169 and the aggregate gross unrealized appreciation and depreciation
based on that cost was:
Unrealized appreciation $575,291,509
Unrealized depreciation (21,197,155)
___________________________________________________________________________
Net unrealized appreciation $554,094,354
___________________________________________________________________________
</TABLE>
<PAGE>
PAGE 36
IDS mutual funds
Cash equivalent investments
These money market funds have three main goals: conservation of
capital, constant liquidity and the highest possible current income
consistent with these objectives. Very limited risk.
IDS Cash Management Fund
Invests in such money market securities as high quality commercial
paper, bankers' acceptances, certificates of deposits (CDs) and
other bank securities.
(icon of) piggy bank
IDS Tax-Free Money Fund
Invests primarily in short-term bonds and notes issued by state and
local governments to seek high current income exempt from federal
income taxes.
(icon of) shield with piggy bank enclosed
Income investments
The funds in this group invest their assets primarily in corporate
bonds or government securities to seek interest income. Secondary
objective is capital growth. Risk varies by bond quality.
IDS Global Bond Fund
Invests primarily in debt securities of U.S. and foreign issuers to
seek high total return through income and growth of capital.
(icon of) globe
IDS Extra Income Fund
Invests mainly in long-term, high-yielding corporate fixed-income
securities in the lower rated, higher risk bond categories to seek
high current income. Secondary objective is capital growth.
(icon of) cornucopia
IDS Bond Fund
Invests mainly in corporate bonds, at least 50% in the higher
rated, lower risk bond categories, or the equivalent, and in
government bonds.
(icon of) greek column
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PAGE 37
IDS Selective Fund
Invests in high-quality corporate bonds and other highly rated debt
instruments including government securities and short-term
investments. Seeks current income and preservation of capital.
(icon of) skyline
IDS Federal Income Fund
Invests primarily in securities issued or guaranteed as to the
timely payment of principal and interest by the U.S. government,
its agencies and instrumentalities. Seeks a high level of current
income and safety of principal consistent with its type of
investments.
(icon of) federal building
Tax-exempt income investments
These funds provide tax-free income by investing in municipal
bonds. The income is generally free from federal income tax. Risk
varies by bond quality.
IDS High Yield Tax-Exempt Fund
Invests primarily in medium- and lower-quality municipal bonds and
notes. Lower-quality securities generally involve greater risk of
principal and income.
(icon of) shield with basket of apples enclosed
IDS State Tax-Exempt Funds
(CA, MA, MI, MN, NY, OH)
Invests primarily in high- and medium-grade municipal securities to
provide income to residents of each respective state that is exempt
from federal, state and local income taxes. (New York is the only
state that is exempt at the local level.)
(icon of) shield with U.S. enclosed
IDS Tax-Exempt Bond Fund
Invests mainly in bonds and notes of state or local government
units, with at least 75% in the four highest rated, lowest risk
bond categories.
(icon of) shield with Greek column
IDS Insured Tax-Exempt Fund
Invests primarily in municipal securities that are insured as to
the timely payment of principal and interest. The insurance
feature minimizes credit risk of the fund but does not guarantee
the market value of the fund's shares.
(icon of) shield with eagle head
<PAGE>
PAGE 38
Growth and income investments
These funds focus on securities of medium to large, well-
established companies that offer long-term growth of capital and
reasonable income from dividends and interest. Moderate risk.
IDS International Fund
Invests primarily in common stocks of foreign companies that offer
potential for superior growth. The fund may invest up to 20% of
its assets in the U.S. market.
(icon of) three flags
IDS Managed Retirement Fund
Invests in a combination of common stocks, fixed-income investments
and money market securities to seek a maximum total return through
a combination of growth of capital and current income.
(icon of) bird in a nest
IDS Equity Select Fund
Invests primarily in a combination of moderate growth stocks,
higher-yielding equities and bonds. Seeks growth of capital and
income.
(icon of) three apple trees
IDS Blue Chip Advantage Fund
Invests in selected stocks from a major market index. Securities
purchased are those recommended by our research analysts as the
best from each industry represented on the index. Offers potential
for long-term growth as well as dividend income.
(icon of) ribbon
IDS Stock Fund
Invests in common stock of companies representing many sectors of
the economy. Seeks current income and growth of capital.
(icon of) building with columns
IDS Equity Value Fund
Invests primarily in undervalued common stocks that offer potential
for growth of capital and income.
(icon of) three growing flowers
<PAGE>
PAGE 39
IDS Utilities Income Fund
Invests primarily in the stocks of public utility companies to seek
high current income and growth of income and capital with reduced
volatility.
(icon of) electrical cord
IDS Diversified Equity Income Fund
Invests primarily in high-yielding common stocks to seek high
current income and, secondarily, to benefit from the growth
potential offered by stock investments.
(icon of) four puzzle pieces
IDS Mutual
Invests in a balance between common stocks and senior securities
(preferred stocks and bonds). Seeks a balance of growth of capital
and current income.
(icon of) scale of justice
Growth investments
Funds in this group seek capital growth, primarily from common
stocks. They are high risk mutual funds with a potential for high
reward.
IDS Discovery Fund
Invests in small- and medium-size, growth-oriented companies
emphasizing technological innovation and productivity enhancement.
Buys and holds larger growth-oriented stocks.
(icon of) ship
IDS Strategy Aggressive Fund
Invests primarily in common stocks of companies that are selected
for their potential for above-average growth. Above-average means
that their growth potential is better, in the opinion of the
portfolio's investment manager, than the Standard & Poor's
Corporation (S&P) 500 Stock Index.
(icon of) chess piece
IDS Growth Fund
Invests primarily in companies that have above-average potential
for long-term growth as a result of new management, marketing
opportunities or technological superiority.
(icon of) flower
<PAGE>
PAGE 40
IDS Global Growth Fund
Invests in stocks of companies throughout the world that are
positioned to meet market needs in a changing world economy. These
companies offer above-average potential for long-term growth.
(icon of) world
IDS New Dimensions Fund
Invests primarily in companies with significant growth potential
due to superiority in technology, marketing or management. The
fund frequently changes its industry mix.
(icon of) dimension
IDS Progressive Fund
Invests primarily in undervalued common stocks. The fund holds
stocks for the long term with the goal of capital growth.
(icon of) shooting star
Specialty growth investment
This fund aggressively seeks capital growth as a hedge against
inflation.
IDS Precious Metals Fund
Invests primarily in the securities of foreign or domestic
companies that explore for, mine and process or distribute gold and
other precious metals. This is the most aggressive and most
speculative IDS mutual fund.
(icon of) cart of precious gems
For more complete information about any of these funds, including
charges and expenses, you can obtain a prospectus by contacting
your financial advisor or writing to American Express Shareholder
Service, P.O. Box 534, Minneapolis, MN 55440-0534. Read it
carefully before you invest or send money.
<PAGE>
PAGE 41
Federal income tax information
IDS High Yield Tax-Exempt Fund, Inc.
___________________________________________________________________
The Fund is required by the Internal Revenue Code of 1986 to tell
its shareholders about the tax treatment of the dividends it pays
during its fiscal year. The dividends listed below were reported
to you on your year-end statement, in January.
IDS High Yield Tax-Exempt Fund
Fiscal year ended Nov. 30, 1995
Class A
Exempt-interest dividends - taxable status explained below.
Payable date Per share
Dec. 28, 1994 $0.02355
Jan. 25, 1995 0.02161
Feb. 23, 1995 0.02445
March 27, 1995 0.02502
April 26, 1995 0.02340
May 25, 1995 0.02195
June 26, 1995 0.02490
July 26, 1995 0.02262
Aug. 25, 1995 0.02245
Sept. 25, 1995 0.02366
Oct. 26, 1995 0.02314
Nov. 27, 1995 0.02410
Total distributions $0.28085
Class B
Exempt-interest dividends - taxable status explained below.
March 27, 1995 0.02463
April 26, 1995 0.02085
May 25, 1995 0.01932
June 26, 1995 0.02192
July 26, 1995 0.01986
Aug. 25, 1995 0.01969
Sept. 25, 1995 0.02077
Oct. 26, 1995 0.02023
Nov. 27, 1995 0.02107
Total distributions $0.18834
<PAGE>
PAGE 42
Class Y
Exempt-interest dividends - taxable status explained below.
March 27, 1995 0.02519
April 26, 1995 0.02404
May 25, 1995 0.02258
June 26, 1995 0.02560
July 26, 1995 0.02327
Aug. 25, 1995 0.02310
Sept. 25, 1995 0.02434
Oct. 26, 1995 0.02381
Nov. 27, 1995 0.02480
Total distributions $0.21673
Source of distributions
Distributions during the fiscal year ended Nov. 30, 1995,
were derived exclusively from interst on tax-exempt securities.
Federal taxation
Exempt-interest dividends are exempt from federal income taxes and
should not be included in shareholders' gross income.
Other taxation
Exempt-interest dividends may be subject to state and local taxes.
Each shareholder should consult a tax advisor about reporting this
income for state and local tax purposes.
Source of income by state
Percentages of income from municipal securities earned by the Fund
from various states during the year ended Nov. 30, 1995 are listed
below.
Alabama 0.836%
Alaska 0.287
Arizona 0.653
Arkansas 0.258
California 5.814
Colorado 4.535
Connecticut 0.156
Florida 4.608
Georgia 2.661
Hawaii 0.306
Idaho 0.018
Illinois 8.902
Indiana 3.021
Iowa 0.799
Kentucky 1.506
Louisiana 3.224
Maine 0.290
Maryland 0.567
Massachusetts 2.314
Michigan 4.203
Minnesota 3.304
Mississippi 1.415
Missouri 0.691
Nebraska 0.020
Nevada 0.524
New Hampshire 2.642
New Jersey 0.238
New Mexico 1.860
New York 7.230
North Carolina 3.949
North Dakota 0.359
Ohio 2.756
Oklahoma 1.492
Oregon 0.502
Pennsylvania 5.156
Puerto Rico 0.674
Rhode Island 0.043
South Carolina 1.661
South Dakota 0.269
Tennessee 0.561
Texas 10.550
Utah 1.843
Virginia 0.412
Washington 3.153
Washington, DC 0.937
West Virginia 1.824
Wisconsin 0.684
Wyoming 0.293
<PAGE>
PAGE 43
Quick telephone reference
American Express Telephone Transaction Service
Redemptions and exchanges, dividend payments or reinvestments and
automatic payment arrangements
National/Minnesota: 800-437-3133
Mpls./St. Paul area: 671-3800
American Express Shareholder Service
Fund performance, objectives and account inquiries
612-671-3733
TTY Service
For the hearing impaired
800-846-4852
American Express Infoline
Automated account information (TouchToneR phones only), including
current fund prices and performance, account values and recent
account transactions
National/Minnesota: 800-272-4445
Mpls./St. Paul area: 671-1630
AMERICAN
EXPRESS
FINANCIAL
ADVISORS
IDS High Yield Tax-Exempt Fund
IDS Tower 10
Minneapolis, MN 55440-0010
<PAGE>
PAGE 44
STATEMENT OF DIFFERENCES
Difference Description
1) The layout is different 1) Some of the layout in the
throughout the annual report. annual report to
shareholders is in two
columns.
2) Headings. 2) The headings in the
annual report and
prospectus are placed
in a blue strip at the
top of the page.
3) There are pictures, icons 3) Each picture, icon and
and graphs throughout the graph is described in
annual report and prospectus. parentheses.
4) Footnotes for charts and 4) The footnotes for each
graphs are described at chart or graph are typed
the left margin. below the description of
the chart or graph.
