CMA
CMA TAX-EXEMPT FUND
Annual Report
March 31, 1999
MERRILL LYNCH BULL LOGO
This report is not authorized for use as an offer of sale or a
solicitation of an offer to buy shares of the Fund unless
accompanied or preceded by the Fund's current prospectus. An
investment in the Fund is not insured or guaranteed by the Federal
Deposit Insurance Corporation or any other Government agency.
Although the Fund seeks to preserve the value of your investment at
$1.00 per share, it is possible to lose money by investing in the
Fund. Past performance results shown in this report should not be
considered a representation of future performance, which will
fluctuate. Statements and other information herein are as dated and
are subject to change.
CMA Tax-Exempt Fund
Box 9011
Princeton, NJ 08543-9011
Printed on post-consumer recycled paper
TO OUR SHAREHOLDERS:
For the year ended March 31, 1999, CMA Tax-Exempt Fund paid
shareholders a net annualized yield of 2.87%.* As of March 31, 1999,
the Fund's 7-day yield was 2.48%.
Economic Environment
During the six-month period ended March 31, 1999, interest rates for
short-term securities were somewhat mixed. The outset of the period
was characterized by falling interest rates as investors continued
to seek the quality and safety of US Treasury bills during a time of
global financial uncertainty. In an effort to calm investors and
restore order to financial markets, including the US stock market,
the Federal Reserve Board embarked on a series of interest rate
cuts. The first cut was at the end of the previous six-month period,
but the last two came in October and November, which altogether
reduced the Federal Funds rate by 75 basis points (0.75%) to 4.75%.
The March period was marked by falling short-term interest rates
from both increased demand for US Treasury bills as well as from
investor expectations of slower economic growth and additional
Federal Reserve Board interest rate cuts. However, the 75 basis
points cut in interest rates seemed sufficient to restore order to
the financial markets, and in some cases, caused equity markets to
rally significantly. Additionally, economic growth continued to
exceed expectations in the fourth quarter of 1998 and into the first
quarter of 1999. Although inflation remained benign, this
exceedingly strong economic growth created a concern that the
Federal Reserve Board might have to actually raise interest rates in
order to keep growth from igniting inflation. Consequently, the
second half of the period was marked primarily by rising short-term
interest rates. For example, the yield on the one-year US Treasury
bill, which began the period at 4.49%, fell to the mid-3.75% range
at mid-October, but closed the period at 4.69%.
[FN]
*Based on a constant investment throughout the period, with
dividends compounded daily, and reflecting a net return to the
investor after all expenses.
During the six-month period ended March 31, 1999, interest rates on
short-term tax-exempt securities also experienced the same degree of
volatility. However, this volatility was created more by supply and
demand factors than by events in the other financial markets.
Interest rates fell in October and November for securities with
maturities of six months--one year as demand remained strong. These
rates remained low into January 1999 as demand continued to
strengthen, especially in a period of low new-issue volume. However,
as demand began to subside in February and because of historically
rich levels of short-term tax-exempt issues, interest rates began to
rise. For example, yields on nine-month--one-year tax-exempt notes,
which began the period in the 3.05% range, fell to as low as 2.75%
by early January only to rise and end the period in the 3.15% area.
Assets of the tax-exempt money fund industry rose almost $20
billion, an increase of over 11% for the six-month period. This
increase occurred in an environment in which new-issue supply fell
to $16.3 billion for the period, a decrease of 33% from the $24.2
billion issued in the previous six-month period. In general, supply
of fixed rate notes has declined in the last two years, since the
strong economy bolstered municipal balance sheets and created the
need for less borrowing. This trend is expected to continue in 1999.
Investment Strategy
During the fiscal year ended March 31, 1999, net assets of CMA Tax-
Exempt Fund rose to a record high level, closing the period at
approximately $9.6 billion. We maintained the Fund's average
portfolio maturity in the 35-day--45-day range for most of the
fiscal year as the yield curve for short-term tax-exempt securities
continued to remain flat to inverted. We deviated from this strategy
only during periods when demand for variable rate products was
exceptionally strong. In a flat or inverted yield curve environment,
there is little or no yield reward for purchasing longer-dated
securities. During times of heavier-than-normal new issuance, we
extended our average life by utilizing six-month--one-year notes or
tax-exempt commercial paper when yields appeared to be attractive.
This strategy served to enhance the Fund's performance as it
outperformed the average of its peer group for the fiscal year as
measured by Lipper Analytical Services, while at the same time
allowing us to maintain an extremely high-quality portfolio. Credit
quality and diversification remain paramount to the Fund as we seek
to offer shareholders an attractive tax-exempt market yield.
In Conclusion
We thank you for your continued support of CMA Tax-Exempt Fund, and
we look forward to serving your investment needs in the months and
years ahead.
Sincerely,
(Terry K. Glenn)
Terry K. Glenn
President and Trustee
(Vincent R. Giordano)
Vincent R. Giordano
Senior Vice President
(Peter J. Hayes)
Peter J. Hayes
Vice President and Portfolio Manager
May 12, 1999
After more than 20 years of service, Arthur Zeikel recently retired
as Chairman of Merrill Lynch Asset Management, L.P. (MLAM). Mr.
Zeikel served as President of MLAM from 1977 to 1997 and as Chairman
since December 1997. Mr. Zeikel is one of the country's most
respected leaders in asset management and presided over the growth
of Merrill Lynch's asset management business. During his tenure,
client assets under management grew from $300 million to over $500
billion. Mr. Zeikel will remain on Merrill Lynch CMA Tax-Exempt
Fund's Board of Trustees. We are pleased to announce that Terry K.
Glenn has been elected President and Trustee of the Fund. Mr. Glenn
has held the position of Executive Vice President of MLAM since
1983.
Mr. Zeikel's colleagues at MLAM join the Fund's Board of Trustees in
wishing him well in his retirement from Merrill Lynch and are
pleased that he will continue as a member of the Fund's Board of
Trustees.
Portfolio Abbreviations for CMA Tax-Exempt Fund
ACES SM Adjustable Convertible Extendible Securities
AMT Alternative Minimum Tax (subject to)
BAN Bond Anticipation Notes
COP Certificates of Participation
CP Commercial Paper
DATES Daily Adjustable Tax-Exempt Securities
EDA Economic Development Authority
FLOATS Floating Rate Securities
GO General Obligation Bonds
HFA Housing Finance Agency
IDA Industrial Development Authority
IDB Industrial Development Board
IDR Industrial Development Revenue Bonds
M/F Multi-Family
MSTR Municipal Securities Trust Receipts
PCR Pollution Control Revenue Bonds
RAN Revenue Anticipation Notes
S/F Single-Family
TAN Tax Anticipation Notes
TAW Tax Anticipation Warrants
TRAN Tax Revenue Anticipation Notes
UPDATES Unit Price Adjustable Tax-Exempt Securities
VRDN Variable Rate Demand Revenue Bonds
<TABLE>
CMA TAX-EXEMPT FUND
SCHEDULE OF INVESTMENTS AS OF MARCH 31, 1999 (IN THOUSANDS)
<CAPTION>
Face Value
State Amount Issue (Note 1a)
<S> <C> <S> <C>
Alabama--2.4% $ 9,435 Alabama Special Care Facilities Financing Authority, Montgomery
Health Care Facilities Revenue Bonds (Saint Margaret's Hospital),
VRDN, 3.20% due 11/01/2013 (h) $ 9,435
67,500 Birmingham, Alabama, Medical Clinic Board, Revenue Refunding Bonds
(U.A.H.S.F.), VRDN, 3% due 12/01/2026 (h) 67,500
Columbia, Alabama, IDB, PCR, Refunding (Alabama Power
Company Project), VRDN (h):
25,000 Series A, 2.85% due 5/01/2022 25,000
10,300 Series C, 3.05% due 10/01/2022 10,300
7,900 Series E, 3% due 10/01/2022 7,900
14,700 Mobile, Alabama, IDB, PCR, Refunding (Alabama Power Company Project),
VRDN, 2.90% due 6/01/2015 (h) 14,700
25,050 Parrish, Alabama, IDB, PCR, Refunding (Alabama Power Company Project),
VRDN, 2.85% due 6/01/2015 (h) 25,050
24,000 Stevenson, Alabama, IDB, Environmental Improvment Revenue Bonds
(Mead Corporation Project), VRDN, AMT, 2.95% due 1/01/2031 (h) 24,000
48,900 West Jefferson, Alabama, IDB, PCR, Refunding (Alabama Power
Company Project), VRDN, 2.90% due 6/01/2028 (h) 48,900
Alaska--0.5% 17,000 Anchorage, Alaska, GO, TAN, 3.75% due 1/04/2000 17,101
Valdez, Alaska, Marine Terminal Revenue Refunding Bonds
(Exxon Pipeline Company Project), VRDN (h):
27,300 2.85% due 10/01/2025 27,300
3,600 Series B, 3% due 12/01/2033 3,600
4,335 Series C, 3% due 12/01/2033 4,335
Arizona--2.0% 26,300 Apache County, Arizona, IDA, IDR (Tucson Electric), VRDN,
Series 83B, 3.05% due 12/15/2018 (h) 26,300
10,200 Arizona Educational Loan Marketing Corporation, Educational
Loan Revenue Bonds, VRDN, AMT, Series A, 3.10% due 3/01/2015 (f)(h) 10,200
6,350 Coconino County, Arizona, Pollution Control Corporation
Revenue Bonds (Arizona Public Service--Navajo Project),
VRDN, AMT, Series A, 2.95% due 10/01/2029 (h) 6,350
16,900 Maricopa County, Arizona, IDA, Hospital Facility Revenue
Refunding Bonds (Samaritan Health Service Hospital), VRDN,
Series B2, 3% due 12/01/2008 (f)(h) 16,900
11,100 Maricopa County, Arizona, Pollution Control Corporation, PCR
(El Paso Electric Company Project), VRDN, Series A, 3% due 7/01/2014 (h) 11,100
Maricopa County, Arizona, Pollution Control Corporation, PCR,
Refunding, VRDN (h):
6,650 (Arizona Public Service Company), Series A, 3% due 5/01/2029 6,650
9,200 (Arizona Public Service Company), Series D, 2.90% due 5/01/2029 9,200
25,000 (El Paso Electric Company Project), Series A, 3.15% due 8/01/2015 25,000
20,785 Phoenix, Arizona, Civic Improvement Corporation, Wastewater Systems,
Lease Revenue Bonds, Tender Option Certificates, VRDN,
Series BTP-250, 3.20% due 7/01/2023 (h) 20,785
11,100 Pinal County, Arizona, IDA, PCR (Newmont Mining), DATES, 2.85%
due 12/01/2009 (h) 11,100
</TABLE>
<TABLE>
CMA TAX-EXEMPT FUND
SCHEDULE OF INVESTMENTS AS OF MARCH 31, 1999 (CONTINUED) (IN THOUSANDS)
<CAPTION>
Face Value
State Amount Issue (Note 1a)
<S> <C> <S> <C>
Arizona Salt River Project, Arizona, Agriculture Improvement and Power
(concluded) District, Electric System Revenue Promissory Notes, CP:
$14,000 2.95% due 5/04/1999 $ 14,000
20,581 2.95% due 5/05/1999 20,581
11,006 2.90% due 5/07/1999 11,006
8,900 Tempe, Arizona, Excise Tax Revenue Bonds, VRDN, 2.90% due 7/01/2023 (h) 8,900
Arkansas-- Arkansas State Development Finance Authority, S/F Mortgage Revenue Bonds
0.2% (Mortgage Backed Securities Program), AMT (d):
3,495 Series B, 3.75% due 7/01/1999 3,495
14,000 Series C, 3% due 3/01/2000 14,000
California-- 41,425 California Higher Education Loan Authority Inc., Student Loan Revenue Bonds,
1.1% AMT, Series C, 3.75% due 6/01/1999 (i) 41,425
21,500 California Higher Education Loan Authority Inc., Student Loan Revenue
Refunding Bonds, Series A, 3.80% due 5/01/1999 21,500
40,000 Los Angeles County, California, Metropolitan Transportation
Authority, Revenue Refunding Bonds, MSTR, VRDN, Series SGB 1,
3.04% due 7/01/2025 (e)(h) 40,000
Colorado-- 69,000 Colorado Health Facilities Authority, Revenue Refunding Bonds
1.3% (Catholic Health), VRDN, Series B, 3% due 12/01/2025 (h) 69,000
10,500 Denver, Colorado, City and County Airport Revenue Bonds,
VRDN, AMT, Series F, 3.10% due 11/15/2025 (h) 10,500
14,705 Moffat County, Colorado, PCR, Refunding (Pacificorp
Projects), VRDN, 3% due 5/01/2013 (a)(h) 14,705
14,755 Palomino Park, Colorado, Public Improvements Corporation,
Assessment Lien Revenue Bonds, VRDN, 3.20% due 12/01/2035 (h) 14,755
Pitkin County, Colorado, IDR, Refunding (Aspen Skiing Company
Project), VRDN (h):
6,500 AMT, Series B, 3.05% due 4/01/2014 6,500
5,010 Series A, 2.90% due 4/01/2016 5,010
8,000 Westminster, Colorado, IDR, Refunding (Ball Corporation Project),
VRDN, 3% due 6/01/2005 (h) 8,000
Connecticut-- 28,000 Bridgeport, Connecticut, GO, BAN, 3.50% due 1/18/2000 28,054
1.1% 22,000 Connecticut State Special Assignment, Unemployment Compensation
Revenue Bonds (Connecticut Unemployment), Series C, 3.60% due 7/01/1999 (c) 22,000
8,650 Connecticut State Special Tax Obligation, Tender Option Certificates,
Series BTP-262, 3% due 8/25/1999 8,650
Connecticut State Tender Option Certificates:
7,920 Series BTP-292, 3% due 8/25/1999 7,920
3,560 VRDN, Series BTP-189, 3.20% due 5/01/2005 (h) 3,560
Eagle Tax-Exempt Trust, Connecticut, VRDN, Class 0701 (h):
13,200 Series 94, 2.95% due 8/15/2012 13,200
24,750 Series 96, 3.11% due 11/15/2004 24,750
Delaware-- ABN-Amro Munitops Certificates Trust:
1.1% 13,500 Series 1998-22, 3.20% due 6/02/1999 13,500
18,000 Series 1998-27, 3.40% due 11/17/1999 18,000
10,000 VRDN, AMT, Series 1998-15, 3.25% due 6/02/1999 (h) 10,000
20,000 VRDN, Series 1998-16, 3.18% due 10/04/2006 (h) 20,000
34,000 Delaware State EDA, IDR (Star Enterprise Project), VRDN, AMT,
Series B, 3.05% due 8/01/2029 (h) 34,000
6,930 Delaware State EDA Revenue Bonds, FLOATS, Series PMD-1,
3.26% due 3/01/2020 (h) 6,930
District of District of Columbia, GO, General Fund Recovery, VRDN (h):
Columbia-- 11,980 Series B-1, 3.10% due 6/01/2003 11,980
0.7% 14,800 Series B-3, 3.10% due 6/01/2003 14,800
16,800 District of Columbia, Hospital Revenue Bonds (Providence
Hospital), VRDN, Series A, 3.20% due 12/01/2019 (h) 16,800
26,700 Eagle Tax-Exempt Trust, Washington D.C., GO, VRDN,
Series 94-A, 3.11% due 6/01/2005 (h) 26,700
</TABLE>
<TABLE>
CMA TAX-EXEMPT FUND
SCHEDULE OF INVESTMENTS AS OF MARCH 31, 1999 (CONTINUED) (IN THOUSANDS)
<CAPTION>
Face Value
State Amount Issue (Note 1a)
<S> <C> <S> <C>
Florida--2.3% $12,000 Capital Projects Finance Authority, Florida Revenue Bonds
(Florida Hospital Association-Capital Projects Loan), VRDN,
Series A, 3.15% due 6/01/2028 (e)(h) $ 12,000
54,240 Dade County, Florida, Water and Sewer System Revenue Bonds,
VRDN, 3.15% due 10/05/2022 (c)(h) 54,240
24,750 Eagle Tax-Exempt Trust, Florida Turnpike, VRDN, Series 96C,
Class 0903, 3.10% due 7/01/2025 (h) 24,750
27,965 Florida State Board of Education, Capital Outlay, GO,
MSTR, VRDN, Series SGA-67, 3.05% due 6/01/2022 (h) 27,965
24,195 Florida State Municipal Power Agency, Revenue Refunding
Bonds (Stanton Project), VRDN, 2.90% due 10/01/2019 (f)(h) 24,195
6,050 Greater Orlando Aviation Authority, Orlando, Florida,
Airport Facilities Revenue Bonds, FLOATS, Series A-51,
Registered D, 3.15% due 10/01/2023 (h) 6,050
12,500 Hillsborough County, Florida, IDA, PCR, Refunding
(Tampa Electric Company-Gannon), VRDN, 2.90% due 5/15/2018 (h) 12,500
5,000 Jacksonville, Florida, CP, 3% due 5/06/1999 5,000
10,000 Jacksonville, Florida, PCR, Refunding (Florida Power & Light Co.
Project), VRDN, 2.90% due 5/01/2029 (h) 10,000
4,935 Jacksonville, Florida, Revenue Bonds (YMCA Florida First
Coast Project), VRDN, 3.05% due 3/01/2018 (h) 4,935
11,000 Pinellas County, Florida, HFA, S/F Housing Revenue Bonds,
Multi-County, AMT, Series A-4, 3.05% due 10/01/1999 (d) 11,000
Sunshine State Governmental Financing Commission, Florida,
Revenue Bonds, CP:
6,800 3% due 5/03/1999 6,800
20,980 2.95% due 5/13/1999 20,980
6,360 Volusia County, Florida, Health Facilities Authority Revenue Bonds
(Pooled Hospital Loan Program), ACES, 3% due 11/01/2015 (c)(h) 6,360
Georgia--4.4% Bartow County, Georgia, Development Authority, PCR, Refunding
(Georgia Power Company Plant-Bowen Project), VRDN (h):
41,400 2.90% due 3/01/2024 41,400
8,045 First Series, 2.90% due 6/01/2023 8,045
Burke County, Georgia, Development Authority, PCR
(Georgia Power Company Plant-Vogtle Project), VRDN (h):
30,200 2.90% due 9/01/2026 30,200
22,000 Third Series, 2.90% due 7/01/2024 22,000
Burke County, Georgia, Development Authority, PCR, Refunding
(Georgia Power Company Plant-Vogtle Project), VRDN (h):
37,200 AMT, 2.95% due 9/01/2034 37,200
27,025 Second Series, 2.90% due 4/01/2025 27,025
26,400 Third Series, 2.90% due 9/01/2025 26,400
29,706 Georgia Municipal Association, Pooled Bonds, COP, VRDN,
3% due 12/15/2020 (f)(h) 29,706
Georgia Municipal Gas Authority, Gas Revenue Bonds, VRDN (h):
14,615 (Agency Project), Series A, 3.05% due 11/01/2006 14,615
98,200 (Gas Portfolio II Project), Series C, 3.05% due 1/01/2008 98,200
15,800 Heard County, Georgia, Development Authority, PCR, Refunding
(Georgia Power Company Plant-Wansley), VRDN, 2.90% due 9/01/2029 (h) 15,800
Metropolitan Atlanta Rapid Transit Authority, Georgia,
Sales Tax Revenue Bonds, Tender Option Certificates, VRDN(h):
7,005 Series BTP-212, 3.12% due 7/01/2002 7,005
7,340 Series BTP-213, 3.12% due 7/01/2004 7,340
25,200 Monroe County, Georgia, Development Authority, PCR, Refunding
(Georgia Power Company-Scherer), VRDN, First Series, 2.90% due 7/01/2025 (h) 25,200
5,400 Municipal Electric Authority, Georgia, Revenue Refunding Bonds
(Project One), VRDN, Series B, 2.95% due 1/01/2016 (h) 5,400
Putnam County, Georgia, Development Authority, PCR, Refunding
(Georgia Power Company Plant Project), VRDN (h):
4,600 2.90% due 3/01/2024 4,600
16,800 First Series, 2.90% due 6/01/2023 16,800
13,700 Second Series, 2.90% due 9/01/2029 13,700
</TABLE>
<TABLE>
CMA TAX-EXEMPT FUND
SCHEDULE OF INVESTMENTS AS OF MARCH 31, 1999 (CONTINUED) (IN THOUSANDS)
<CAPTION>
Face Value
State Amount Issue (Note 1a)
<S> <C> <S> <C>
Idaho--0.2% $22,600 Idaho Health Facilities Authority Revenue Bonds, Pooled
Financing Program, ACES, 3.10% due 10/01/2010 (h) $ 22,600
Illinois--8.7% 16,650 Chicago, Illinois, GO, VRDN, Series B, 3% due 1/01/2012 (h) 16,650
7,000 Chicago, Illinois, IDR (Enterprise Center VIII Project),
VRDN, AMT, 3.09% due 6/01/2022 (h) 7,000
26,000 Chicago, Illinois, Midway Airport Revenue Bonds,
Second Lien, VRDN, AMT, Series A, 3% due 1/01/2029 (f)(h) 26,000
Chicago, Illinois, O'Hare International Airport Revenue Bonds
(American Airlines), DATES (h):
20,200 Series A, 2.90% due 12/01/2017 20,200
26,900 Series B, 2.90% due 12/01/2017 26,900
23,500 Series C, 2.90% due 12/01/2017 23,500
18,200 Series D, 2.90% due 12/01/2017 18,200
6,228 Chicago, Illinois, O'Hare International Airport Revenue Bonds
(General Airport Second Lien), VRDN, Series B, 3.05% due 1/01/2015 (h) 6,228
14,800 Chicago, Illinois, O'Hare International Airport, Special Facilities
Revenue Bonds (Compagnie Nationale-Air France), VRDN, AMT,
3.20% due 5/01/2018 (h) 14,800
15,000 Chicago, Illinois, Park District Warrants, TAW, 4.30% due 9/17/1999 15,050
125,000 Chicago, Illinois, Tender Notes, GO, VRDN, 2.95% due 1/27/2000 (h) 125,000
19,800 Eagle Tax-Exempt Trust, Chicago, Illinois, Emergency Phone,
VRDN, Series 96C, Class 1302, 2.95% due 1/01/2012 (h) 19,800
Eagle Tax-Exempt Trust, Chicago, Illinois, GO, Class 1301:
14,380 Series 95, 3% due 5/04/1999 14,380
9,900 Series 98, 2.95% due 5/04/1999 9,900
14,355 Eagle Tax-Exempt Trust, Illinois, Metropolitan Expo Center,
VRDN, Series 98, Class 1306, 2.95% due 6/15/2029 (h) 14,355
9,900 Eagle Tax-Exempt Trust, Illinois State, GO, VRDN, Series 96C,
Class 1302, 3.10% due 7/01/2020 (h) 9,900
12,200 Illinois Development Finance Authority, PCR, Refunding
(Commonwealth Edison Company Project), VRDN, Series B, 2.95%
due 10/15/2014 (h) 12,200
21,500 Illinois Development Finance Authority, Revenue Bonds
(Lyric Opera Chicago Project), VRDN, 2.95% due 12/01/2028 (h) 21,500
Illinois Development Finance Authority, Revenue Refunding Bonds, VRDN (h):
6,000 (Olin Corporation Project), Series A, 2.95% due 6/01/2004 6,000
32,000 (Provena Health), Series B, 2.90% due 5/01/2028 (f) 32,000
Illinois Educational Facilities Authority Revenue Bonds, VRDN (h):
20,000 (The Adler Planetarium), 3% due 4/01/2031 20,000
5,000 (Chicago Historical Society), 3% due 12/01/2025 5,000
26,100 (Illinois Institute of Technology), Series A, 3% due 9/01/2025 26,100
Illinois Educational Facilities Authority, Revenue
Refunding Bonds, VRDN (h):
16,300 (Art Institute of Chicago), 3.05% due 3/01/2027 16,300
17,800 (Northwestern University), 3.05% due 12/01/2025 17,800
22,000 Illinois Health Facilities Authority, Revenue Bonds (Evanston
Hospital Corporation Project), CP, 3.10% due 11/01/1999 22,000
Illinois Health Facilities Authority Revenue Bonds:
6,900 (Cent DuPage-Healthcorp Project), VRDN, 2.85% due 11/01/2020 (h) 6,900
10,000 (Evanston Hospital Corporation), CP, Series B, 2.95% due 11/30/1999 10,000
10,000 (Evanston Hospital Corporation), CP, Series C, 2.95% due 11/30/1999 10,000
10,000 (Evanston Hospital Corporation), CP, Series D, 2.95% due 11/30/1999 10,000
41,000 (Northwest Community Hospital), VRDN, 3% due 7/01/2025 (h) 41,000
5,000 (Northwestern Memorial Hospital), VRDN, 2.90% due 8/15/2025 (h) 5,000
7,000 (Revolving Fund Pooled), VRDN, Series F, 3% due 8/01/2015 (h) 7,000
Illinois Health Facilities Authority, Revenue Refunding Bonds, VRDN (h):
60,825 (Advocate Health Care), Series B, 3.20% due 8/15/2022 60,825
19,700 (The Carle Foundation), Series B, 3.05% due 7/01/2028 (a) 19,700
19,805 (Little Company of Mary Hospital), Series A, 3.10% due 8/15/2021 (f) 19,805
29,200 (University of Chicago Hospitals), 2.90% due 8/01/2026 (f) 29,200
</TABLE>
<TABLE>
CMA TAX-EXEMPT FUND
SCHEDULE OF INVESTMENTS AS OF MARCH 31, 1999 (CONTINUED) (IN THOUSANDS)
<CAPTION>
Face Value
State Amount Issue (Note 1a)
<S> <C> <S> <C>
Illinois $18,815 Illinois State, FLOATS, Series SG-60, 3.07%
(concluded) due 8/01/2019 (h) $ 18,815
6,000 Illinois State, GO, 3.50% due 3/01/2000 6,020
4,900 Illinois Student Assistance Commission, Student Loan
Revenue Bonds, VRDN, AMT, Series A, 3.10% due 3/01/2006 (h) 4,900
21,350 Regional Transportation Authority, Illinois, FLOATS, Series SG-82,
3.07% due 6/01/2025 (h) 21,350
Southwestern Illinois Development Authority, Solid Waste
Disposal Revenue Bonds (Shell Oil Company-Wood River Project),
VRDN, AMT (h):
11,100 3.05% due 8/01/2021 11,100
10,600 3.05% due 4/01/2022 10,600
7,000 Will County, Illinois, Exempt Facilities Revenue Bonds
(Amoco Chemical Company Project), VRDN, AMT, 3.05% due 3/01/2028 (h) 7,000
Indiana--4.0% 3,125 Elkhart County, Indiana, Mortgage Revenue Bonds
(Hubbard Hill Estates), VRDN, Series A, 3.35% due 7/01/2027 (h) 3,125
Fort Wayne, Indiana, Hospital Authority, Hospital Revenue
Bonds (Parkview Memorial Hospital), VRDN (h):
1,645 Series B, 3% due 1/01/2016 1,645
2,700 Series B, 3% due 1/01/2020 2,700
3,505 Series C, 3% due 1/01/2016 3,505
5,670 Series D, 3% due 1/01/2016 5,670
5,800 Hammond, Indiana, PCR, Refunding (Amoco Oil Company Project),
VRDN, 2.85% due 2/01/2022 (h) 5,800
114,000 Indiana Bond Bank Revenue Notes (Advance Funding Program
Note), Series A-2, 3.50% due 1/19/2000 114,444
15,000 Indiana Health Facilities Financing Authority, Hospital
Revenue Bonds (Community Hospitals Project), VRDN, Series A, 3.10%
due 7/01/2027 (h) 15,000
Indiana Health Facilities Financing Authority, Hospital Revenue
Refunding Bonds, VRDN (h):
14,730 (Charity Obligation Group), Series E, 3.10% due 11/01/2026 14,730
20,700 (Clarian Health Partners), Series B, 3.10% due 2/15/2026 20,700
18,200 (Clarian Health Partners), Series C, 3.10% due 2/15/2026 18,200
9,150 Indiana Health Facilities Financing Authority Revenue Bonds
(Capital Access Designated Pool), VRDN, 3% due 1/01/2012 (h) 9,150
22,500 Indiana Secondary Market Educational Loans Inc., Educational
Loan Revenue Bonds, VRDN, AMT, Series B, 3.10% due 12/01/2014 (a)(h) 22,500
23,500 Indiana State Development Finance Authority, Environmental
Revenue Refunding and Improvement Bonds (USX Corporation Project),
3% due 8/05/1999 23,500
20,700 Indianapolis, Indiana, Local Public Improvement Bond Bank
Revenue Notes, Limited Obligation Notes, Series G, 3.50% due 8/15/1999 20,738
Jasper County, Indiana, PCR, Refunding (Northern Indiana Public
Service), VRDN (h):
9,800 Series A, 3% due 8/01/2010 9,800
8,000 Series B, 3% due 6/01/2013 8,000
36,800 Series C, 3% due 4/01/2019 36,800
9,400 Princeton, Indiana, PCR, Refunding (PSI Energy Incorporated
Project), VRDN, 2.95% due 4/01/2022 (h) 9,400
9,000 Purdue University, Indiana, University Revenue Bonds (Student Fee),
VRDN, Series O, 2.95% due 7/01/2019 (h) 9,000
Rockport, Indiana, PCR, Refunding (AEP Generating Company
Project), VRDN (a)(h):
14,200 Series A, 2.90% due 7/01/2025 14,200
7,900 Series B, 3% due 7/01/2025 7,900
7,600 Whiting, Indiana, Industrial Sewer and Solid Waste Disposal,
Revenue Refunding Bonds (Amoco Oil Company Project), VRDN, AMT,
3.30% due 1/01/2026 (h) 7,600
</TABLE>
<TABLE>
CMA TAX-EXEMPT FUND
SCHEDULE OF INVESTMENTS AS OF MARCH 31, 1999 (CONTINUED) (IN THOUSANDS)
<CAPTION>
Face Value
State Amount Issue (Note 1a)
<S> <C> <S> <C>
Iowa--2.2% Iowa Finance Authority, Solid Waste Disposal
Revenue Bonds (Cedar River Paper Company Project), VRDN, AMT (h):
$ 4,730 3.10% due 3/01/2033 $ 4,730
66,400 Series A, 3.10% due 7/01/2023 66,400
42,000 Series A, 3.10% due 6/01/2024 42,000
20,500 Series A, 3.10% due 5/01/2025 20,500
45,000 Iowa State School Cash Anticipation Program Warrants
(Iowa School Corporation Warrant Certificates), Series A,
4.50% due 6/25/1999 (e) 45,087
14,500 Iowa Student Loan Liquidity Corporation, Student Loan
Revenue Bonds, VRDN, AMT, Series B, 3.15% due 12/01/2013 (a)(h) 14,500
18,300 Polk County, Iowa, Revenue Refunding Bonds (Catholic Health),
VRDN, Series B, 3% due 12/01/2015 (h) 18,300
Kansas--0.3% 9,100 Butler County, Kansas, Solid Waste Disposal Facilities
Revenue Bonds (Texaco Refining and Marketing), VRDN, AMT,
Series A, 3.10% due 8/01/2024 (h) 9,100
17,500 Kansas State Development Finance Authority, Health Facilities
Revenue Bonds (Stormont-Vail), VRDN, Series M, 2.95% due 11/15/2023 (f)(h) 17,500
Kentucky--3.1% 5,100 Ashland, Kentucky, PCR, Refunding (Calgon Carbon Corporation
Project), FLOATS, Series A, 3.25% due 10/01/2006 (h) 5,100
22,700 Carroll County, Kentucky, Collateralized Solid Waste Disposal
Facilities Revenue Bonds (Kentucky Utilities Company Project),
VRDN, AMT, Series A, 3.10% due 11/01/2024 (h) 22,700
9,900 Clark County, Kentucky, PCR, Refunding (Kentucky Power
National Rural), FLOATS, Series J-1, 3.10% due 4/15/1999 (h) 9,900
Daviess County, Kentucky, Solid Waste Disposal Facility Revenue
Bonds (Scott Paper Company Project), VRDN, AMT (h):
44,100 Series A, 2.95% due 12/01/2023 44,100
16,300 Series A, 2.95% due 5/01/2024 16,300
26,200 Series B, 2.95% due 12/01/2023 26,200
21,700 Series B, 2.95% due 5/01/2024 21,700
25,000 Kentucky Asset/Liability Commission, General Fund Revenue Notes,
Project Notes, Security Series, 3.50% due 11/01/1999 25,079
Kentucky Asset/Liability Commission, General Fund, Series A:
19,000 CP, 2.85% due 8/11/1999 19,000
35,000 TRAN, 4.50% due 6/25/1999 35,074
20,000 Kentucky Economic Development Finance Authority, Hospital Facilities
Revenue Refunding Bonds (Baptist Healthcare), VRDN, Series C,
2.95% due 8/15/2031 (f)(h) 20,000
14,000 Kentucky Economic Development Finance Authority Revenue Bonds
(Pooled Hospital Loan Program), VRDN, 3.15% due 8/01/2018 (h) 14,000
38,300 Kentucky State Pollution Abatement and Water Resource Finance
Authority Revenue Bonds (Toyota Motors), VRDN, AMT, 3.90% due 8/13/2006 (h) 38,300
Louisiana--3.2% 17,700 Ascension Parish, Louisiana, Revenue Bonds (BASF Corporation
Project), VRDN, AMT, 3.10% due 3/01/2025 (h) 17,700
31,500 Calcasieu Parish, Louisiana, Industrial Development Board,
Environmental Revenue Refunding Bonds (Citgo Petroleum Corp.),
VRDN, AMT, 3.10% due 3/01/2025 (h) 31,500
9,760 Eagle Tax-Exempt Trust, Louisiana, VRDN, Series 94, Class 1803,
3.11% due 5/01/2008 (h) 9,760
15,000 East Baton Rouge Parish, Louisiana, PCR, Refunding (Exxon Project),
VRDN, 2.90% due 11/01/2019 (h) 15,000
Louisiana Public Facilities Authority, Hospital Revenue Bonds
(Willis-Knighton Medical Center Project), VRDN (a)(h):
50,800 3.10% due 9/01/2025 50,800
30,500 3.10% due 9/01/2027 30,500
Louisiana State Offshore Terminal Authority, Deepwater Port
Revenue Refunding Bonds (First Stage A-Loop Inc.)(h):
26,400 ACES, 3% due 9/01/2006 (f) 26,400
14,000 VRDN, 3% due 9/01/2008 14,000
</TABLE>
<TABLE>
CMA TAX-EXEMPT FUND
SCHEDULE OF INVESTMENTS AS OF MARCH 31, 1999 (CONTINUED (IN THOUSANDS)
<CAPTION>
Face Value
State Amount Issue (Note 1a)
<S> <C> <S> <C>
Louisiana $24,200 Plaquemines Parish, Louisiana, Environmental Revenue Bonds
(concluded) (BP Exploration & Oil), VRDN, AMT, 3.05% due 10/01/2024 (h) $ 24,200
4,400 Saint Charles Parish, Louisiana, PCR, Refunding
(Shell Oil Company Project), VRDN, 2.90% due 6/01/2005 (h) 4,400
Saint Charles Parish, Louisiana, PCR, VRDN, AMT (h):
24,400 (Shell Oil Company-Norco Project), 3.05% due 11/01/2021 24,400
21,000 (Shell Oil Company Project), Series A, 3.05% due 10/01/2022 21,000
Saint James Parish, Louisiana, PCR, Refunding (Texas Project), CP:
24,030 Series A, 3.20% due 5/13/1999 24,030
15,000 Series B, 3.20% due 5/13/1999 15,000
4,400 South Louisiana Port Commission, Port Revenue Refunding Bonds
(Occidental Petroleum), VRDN, 3.05% due 7/01/2018 (h) 4,400
Maryland--1.5% 18,000 Anne Arundel County, Maryland, BAN, Series B, 3% due 5/14/1999 18,000
35,700 Baltimore, Maryland, Port Facilities Revenue Bonds (Occidental
Petroleum), FLOATS, 3% due 10/14/2011 (h) 35,700
17,200 Maryland State Health and Higher Educational Facilities Authority,
Revenue Refunding Bonds (Pooled Loan Program), VRDN, Series A,
3.05% due 4/01/2035 (h) 17,200
Montgomery County, Maryland, Consolidated CP:
27,500 2.70% due 5/05/1999 27,500
50,000 3.20% due 5/17/1999 50,000
Massachusetts-- 20,900 Eagle Tax-Exempt Trust, Massachusetts, GO, VRDN, Series 93-J,
1.5% 3.10% due 8/01/2005 (h) 20,900
30,000 Everett, Massachusetts, GO, BAN, 3.25% due 12/17/1999 30,027
18,300 Massachusetts State, GO, Refunding, VRDN, Series B, 2.90%
due 8/01/2015 (h) 18,300
11,400 Massachusetts State Health and Educational Facilities
Authority, Revenue Bonds (Partners Healthcare System), VRDN,
Series P-1, 2.95% due 7/01/2027 (e)(h) 11,400
2,300 Massachusetts State Health and Educational Facilities
Authority, Revenue Refunding Bonds (Harvard University),
VRDN, 2.85% due 2/01/2016 (h) 2,300
5,000 Massachusetts State Water Resources Authority, FLOATS,
Series A-52, 3.10% due 8/01/2024 (h) 5,000
60,200 Massachusetts State Water Resources Authority, Revenue
Refunding Bonds, VRDN, Sub-Series D, 2.95% due 11/01/2026 (c)(h) 60,200
Michigan-- 17,000 Grand Rapids, Michigan, Water Supply Revenue Refunding Bonds,
3.3% VRDN, 2.90% due 1/01/2020 (c)(h) 17,000
8,460 Holly, Michigan, School District, FLOATS, Series SG-50, 3.07%
due 5/01/2020 (h) 8,460
Kent Hospital Finance Authority, Michigan, Revenue Refunding
Bonds (Spectrum Health), VRDN (f)(h):
24,200 Series B, 3.10% due 1/15/2026 24,200
26,800 Series C, 3.10% due 1/15/2026 26,800
Michigan Municipal Bond Authority Revenue Notes:
73,000 Series D-1, 4.25% due 8/27/1999 73,193
20,000 Series D-2, 4.25% due 8/27/1999 20,053
16,505 Michigan State Hospital Finance Authority Revenue Refunding
Bonds, VRDN,Series 1997-24, Class A, 3.09% due 12/01/2005 (e)(h) 16,505
Michigan State Strategic Fund Limited Obligation Revenue
Refunding Bonds, VRDN (h):
11,600 (Consumers Power Company Project), Series A, 2.90% due 6/15/2010 11,600
6,150 (Detroit Edison Company), Series CC, 2.90% due 9/01/2030 6,150
17,300 Monroe County, Michigan, Economic Development Corporation,
Limited Obligation Revenue Refunding Bonds (Detroit Edison),
VRDN, Series CC, 2.90% due 10/01/2024 (h) 17,300
Royal Oak, Michigan, Hospital Finance Authority, Hospital
Revenue Bonds (William Beaumont Hospital), VRDN (h):
14,800 Series J, 2.85% due 1/01/2003 14,800
5,300 Series L, 2.85% due 1/01/2027 5,300
54,100 University of Michigan, University Hospital Revenue Bonds,
VRDN, Series A, 3% due 12/01/2027 (h) 54,100
</TABLE>
<TABLE>
CMA TAX-EXEMPT FUND
SCHEDULE OF INVESTMENTS AS OF MARCH 31, 1999 (CONTINUED) (IN THOUSANDS)
<CAPTION>
Face Value
State Amount Issue (Note 1a)
<S> <C> <S> <C>
Michigan $13,900 University of Michigan, University Hospital Revenue Refunding Bonds,
(concluded) VRDN, Series A, 3% due 12/01/2019 (h) $ 13,900
15,800 University of Michigan, University Revenue Bonds (Medical Service
Plan), VRDN, Series A, 3% due 12/01/2027 (h) 15,800
Minnesota-- Eagle Tax-Exempt Trust, Minnesota:
0.9% 24,885 Series 1993-G, 2.95% due 7/26/1999 24,885
46,825 VRDN, Series 1993-A, 2.95% due 8/01/2004 (h) 46,825
17,575 Minnesota State, GO, Refunding, Various Purpose, 4.25% due 6/01/1999 17,591
Mississippi-- 17,600 Harrison County, Mississippi, PCR, Refunding (E.I. du Pont
0.7% de Nemours), VRDN, 3% due 9/01/2010 (h) 17,600
7,000 Jackson County, Mississippi, Industrial Sewer Facilities Revenue
Bonds (Chevron U.S.A. Inc. Project), VRDN, AMT, 3.10% due 12/15/2024 (h) 7,000
Jackson County, Mississippi, PCR, Refunding (Chevron U.S.A. Inc.
Project), VRDN (h):
1,300 2.95% due 12/01/2016 1,300
4,800 2.95% due 6/01/2023 4,800
7,200 Jackson County, Mississippi, Port Facility Revenue Refunding Bonds
(Chevron U.S.A. Inc. Project), VRDN, 2.85% due 6/01/2023 (h) 7,200
13,520 Mississippi Business Finance Corporation, Mississippi, Solid Waste
Disposal Revenue Refunding Bonds (Mississippi Power Company Project),
VRDN, AMT, 3.15% due 5/01/2028 (h) 13,520
10,500 Mississippi Hospital Equipment and Facilities Authority, CP
(North Mississippi Health Services), Series 1, 3% due 5/03/1999 10,500
3,000 Mississippi Hospital Equipment and Facilities Authority Revenue
Bonds (Mississippi Baptist Medical Center), VRDN, 3% due 7/01/2012 (h) 3,000
Missouri--1.9% 30,000 Eagle Tax-Exempt Trust, Missouri, VRDN, 3.11% due 8/01/2006 (h) 30,000
Missouri Higher Education Loan Authority, Student Loan
Revenue Bonds, VRDN, AMT (h):
7,800 Series A, 3.10% due 6/01/2017 7,800
11,700 Series B, 3.10% due 6/01/2020 11,700
14,510 Missouri State, GO, Refunding (Third Street Building),
Series A, 7.50% due 8/01/1999 14,729
5,000 Missouri State Health and Educational Facilities Authority,
Health Facilities Revenue Bonds (Sisters of Mercy Health System),
VRDN, Series A, 3% due 6/01/2019 (h) 5,000
12,000 Missouri State Health and Educational Facilities Authority,
School District Advance Funding Notes (Special School District),
Series L, 4.25% due 9/13/1999 12,031
10,098 Sikeston, Missouri, Electric Revenue Bonds, Tender Option
Certificates, Series BTP-186, 3% due 6/01/2002 (g) 10,098
95,000 University of Missouri Revenue Bonds, Capital Projects Notes,
Series FY 1998-99, 4.25% due 6/30/1999 95,145
Nebraska-- NebHelp Inc., Nebraska, Revenue Bonds (Student Loan Program), VRDN (h):
0.1% 3,550 AMT, Series A, 3.20% due 12/01/2016 (i) 3,550
3,100 Series C, 3.10% due 12/01/2015 (f) 3,100
Nevada--1.5% 127,115 Clark County, Nevada, Airport Improvement Revenue Refunding
Bonds, VRDN, Series A, 2.90% due 7/01/2012 (f)(h) 127,115
7,075 Nevada Housing Division Revenue Bonds (Multi-Unit Housing-Mesquite),
VRDN, AMT, Series B, 3.30% due 5/01/2028 (h) 7,075
9,100 Nevada State Tender Option Certificates, Series BTP-236, 3% due 8/25/1999 9,100
New Hampshire-- 7,415 New Hampshire State Business Finance Authority, Resource Recovery Revenue
0.1% Refunding Bonds (Wheelabrator), VRDN, Series A, 3.05% due 1/01/2018 (h) 7,415
5,700 New Hampshire State, HFA, M/F Housing Revenue Bonds
(P.R.A. Properties-Pheasant Run Project), VRDN, AMT, 3.05% due 5/01/2025 (h) 5,700
New Jersey-- 27,300 Eagle Tax-Exempt Trust, New Jersey, VRDN, Series 96, Class 3001,
0.6% 2.95% due 2/15/2007 (h) 27,300
22,500 Essex County, New Jersey, Improvement Authority, BAN, 3.50% due 3/31/2000 22,575
6,700 New Jersey EDA, Economic Development Revenue Refunding Bonds
(Foreign Trade Zone Project), VRDN, 2.40% due 12/01/2007 (h) 6,700
</TABLE>
<TABLE>
CMA TAX-EXEMPT FUND
SCHEDULE OF INVESTMENTS AS OF MARCH 31, 1999 (CONTINUED) (IN THOUSANDS)
<CAPTION>
Face Value
State Amount Issue (Note 1a)
<S> <C> <S> <C>
New Mexico-- $ 27,600 Farmington, New Mexico, PCR (Arizona Public Service Company), VRDN,
2.1% AMT, Series C, 3% due 9/01/2024 (h) $ 27,600
Farmington, New Mexico, PCR, Refunding (Arizona Public Service
Company), VRDN (h):
3,100 Series A, 2.85% due 5/01/2024 3,100
23,220 Series B, 3% due 9/01/2024 23,220
8,600 Hurley, New Mexico, PCR (Kennecott Santa Fe), UPDATES,
2.85% due 12/01/2015 (h) 8,600
5,155 New Mexico State Highway Commission, Tax Revenue Bonds,
Senior Sub-Lien, Series A, 4.25% due 6/15/1999 5,165
32,200 New Mexico State Hospital Equipment Loan, Council Revenue
funding Bonds (Catholic Health), VRDN, Series B, 3% due 12/01/2022 (h) 32,200
100,000 New Mexico State, TRAN, 4.25% due 6/30/1999 100,156
New York-- 16,000 Brentwood, New York, Union Free High School District, GO, TAN,
7.5% 75% due 6/30/1999 16,005
8,000 Buffalo, New York, GO, RAN, Series A, 3.75% due 7/27/1999 8,019
20,000 Copake Taconic Hills, New York, Central School District, GO,
N, 4.25% due 4/08/1999 20,002
24,700 Eagle Tax-Exempt Trust, New York State Memorial (Sloan),
VRDN, Series 96, Class 3202, 2.90% due 7/01/2023 (h) 24,700
4,000 Hicksville, New York, Union Free School District, GO, TAN,
3.90% due 6/23/1999 4,002
Long Island Power Authority, New York, Electric System
Revenue Bonds:
20,000 Series A, 4.50% due 12/01/1999 20,164
79,300 VRDN, Sub-Series 2, 2.80% due 5/01/2033 (h) 79,300
34,200 VRDN, Sub-Series 5, 3.15% due 5/01/2033 (h) 34,200
31,000 Municipal Assistance Corporation for New York City, New York,
Revenue Bonds, VRDN, Series F, 2.90% due 7/01/2008 (h) 31,000
20,000 Municipal Assistance Corporation for New York City,
New York, Revenue Refunding Bonds, Sub-Series K-1, 3.15% due 5/05/1999 (g) 20,000
15,000 New York City, New York, City Municipal Water Finance Authority,
CP, Series 3, 3.05% due 4/21/1999 15,000
New York City, New York, City Municipal Water Finance Authority,
Water and Sewer System Revenue Bonds:
15,000 CP, 2.75% due 4/13/1999 15,000
5,670 FLOATS, Series A-73, 3.10% due 6/15/2029 (h) 5,670
New York City, New York, City Municipal Water Finance Authority,
Water and Sewer System Revenue Refunding Bonds, VRDN (h):
21,500 MSTR, SGB-27, 3.16% due 6/15/2024 (e) 21,500
22,450 Series G, 2.95% due 6/15/2024 (c) 22,450
New York City, New York, FLOATS (h):
106,000 Series A-76, 2.90% due 4/13/1999 106,000
17,000 Series A-77, 2.90% due 4/13/1999 16,997
40,000 Series A-78, 2.90% due 4/13/1999 40,000
11,440 New York City, New York, GO, Refunding, Series A, 4.25% due 8/01/1999 11,469
New York City, New York, GO, VRDN (h):
8,400 Series B, Sub-Series B-3, 2.90% due 8/15/2004 (f) 8,400
1,610 Series B, Sub-Series B-5, 3% due 8/15/2022 (f) 1,610
10,400 Series F-5, 2.80% due 2/15/2016 10,400
3,000 Sub-Series A-7, 2.95% due 8/01/2019 3,000
New York State, HFA, Revenue Bonds, VRDN (h):
20,390 (Normandie Court-I Project), 2.75% due 5/15/2015 20,390
12,500 (Tribeca Park Housing ), AMT, Series A, 2.80% due 11/01/2030 12,500
48,000 New York State Local Assistance Corporation Revenue Bonds,
VRDN, Series A, 2.80% due 4/01/2022 (h) 48,000
19,000 New York State Local Government Assistance Corporation, Revenue
Refunding Bonds, MSTR, VRDN, Series SGA-59, 3.05% due 4/01/2019 (h) 19,000
53,340 New York State Power Authority Revenue and General Purpose
Bonds, 2.90% due 9/01/1999 53,340
7,000 New York State Thruway Authority, General Revenue Bonds,
VRDN, 2.85% due 1/01/2024 (c)(h) 7,000
</TABLE>
<TABLE>
CMA TAX-EXEMPT FUND
SCHEDULE OF INVESTMENTS AS OF MARCH 31, 1999 (CONTINUED) (IN THOUSANDS)
<CAPTION>
Face Value
State Amount Issue (Note 1a)
<S> <C> <S> <C>
New York Port Authority of New York and New Jersey, Special Obligation Revenue
(concluded) Refunding Bonds, Versatile Structure Obligation, VRDN (h):
$14,600 Series 3, 2.85% due 6/01/2020 $ 14,600
6,500 Series 5, 2.85% due 8/01/2024 6,500
15,000 Rochester, New York, GO, BAN, Series II, 3.10% due 10/28/1999 15,000
North Carolina-- 2,940 Craven County, North Carolina, Industrial Facilities and Pollution
0.6% Control Financing Authority, Resource Revenue Bonds (Craven Wood
Energy Project), VRDN, 3.10% due 5/01/2011 (h) 2,940
16,075 North Carolina Medical Care Commission, Health Care Facilities
Revenue Bonds (Cabarrus Memorial Hospital Project), VRDN, 3%
due 3/01/2012 (h) 16,075
North Carolina Medical Care Commission, Hospital Revenue Bonds (h):
1,700 (Duke University Hospital Project), VRDN, Series B, 2.95% due 6/01/2015 1,700
2,000 (Duke University Hospital Project), VRDN, Series C, 2.95% due 6/01/2015 2,000
2,300 (Pooled Financing Project), ACES, Series A, 3% due 10/01/2020 2,300
8,800 North Carolina Medical Care Commission Revenue Bonds (Carol Woods
Project), VRDN, 2.95% due 4/01/2021 (h) 8,800
15,000 North Carolina Municipal Power Agency, Number 1 Catawba Electric
Revenue Bonds, CP, 2.95% due 5/11/1999 15,000
Raleigh Durham, North Carolina, Airport Authority, Special
Facility Revenue Refunding Bonds (American Airlines), VRDN (h):
8,300 Series A, 2.90% due 11/01/2015 8,300
2,000 Series B, 2.90% due 11/01/2015 2,000
North Dakota-- 12,700 Grand Forks, North Dakota, Health Care Facilities Revenue Bonds
0.3% (The United Hospital Obligation Group), VRDN, Series A, 2.90%
due 12/01/2025 (h) 12,700
15,000 North Dakota, State HFA, Home Mortgage Revenue Bonds (Housing
Finance Program), AMT, Series C, 3.20% due 4/01/2000 15,000
Ohio--2.1% 29,825 Cuyahoga County, Ohio, Hospital Revenue Bonds (The Cleveland
Clinic), VRDN, Series D, 2.90% due 1/01/2026 (h) 29,825
18,125 Cuyahoga County, Ohio, Hospital Revenue Refunding Bonds, VRDN,
Series A, 3% due 1/01/2016 (a)(h) 18,125
22,275 Eagle Tax-Exempt Trust, Ohio State Turnpike, VRDN, Series 98,
Class 3503, 2.95% due 2/15/2026 (h) 22,275
10,500 Eagle Tax-Exempt Trust, Ohio, VRDN, Series 95, Class 3502,
3.06% due 7/01/2015 (h) 10,500
18,150 Franklin County, Ohio, Hospital Revenue Refunding and
Improvement Bonds (U.S. Health Corporation), VRDN, Series A, 3.05%
due 12/01/2021 (h) 18,150
46,700 Montgomery County, Ohio, Revenue Refunding Bonds (Miami Valley
Hospital), VRDN, Series A, 2.85% due 11/15/2022 (h) 46,700
1,865 Ohio HFA, M/F Housing Revenue Bonds (Kenwood Congregate-Retire),
VRDN, 3% due 12/01/2015 (h) 1,865
12,500 Ohio HFA, Residential Mortgage Revenue Bonds, AMT, Series
A-2, 3.05% due 9/01/1999 12,500
17,600 Ohio State Air Quality Development Authority Revenue Bonds,
VRDN, Series B, 3% due 12/01/2015 (h) 17,600
8,100 Ohio State Air Quality Development Authority Revenue Refunding
Bonds (Cincinnati Gas and Electric), VRDN, Series B, 2.85% due 9/01/2030 (h) 8,100
17,900 Ohio State University General Receipts Revenue Bonds,
VRDN, 2.85% due 12/01/2007 (h) 17,900
4,200 Paudling County, Ohio, Solid Waste Disposal Revenue Bonds
(Lafarge Corporation Project), VRDN, AMT, 2.95% due 8/01/2026 (h) 4,200
Oklahoma-- 10,250 Grand River Dam Authority, Oklahoma, Revenue Bonds, FLOATS,
0.1% Series SG-42, 3.07% due 6/01/2009 (h) 10,250
</TABLE>
<TABLE>
CMA TAX-EXEMPT FUND
SCHEDULE OF INVESTMENTS AS OF MARCH 31, 1999 (CONTINUED) (IN THOUSANDS)
<CAPTION>
Face Value
State Amount Issue (Note 1a)
<S> <C> <S> <C>
Oregon--0.3% $10,700 Oregon State Health, Housing, Educational and Cultural
Facilities Authority Revenue Bonds (Sacred Heart Medical Center),
VRDN, Series A, 3.05% due 11/01/2028 (h) $ 10,700
4,750 Oregon State Housing and Community Services Department,
Mortgage Revenue Bonds, S/F Mortgage Program, Series I, 3.15%
due 12/01/1999 4,750
16,140 Oregon State Housing and Community Services Department, Mortgage
Revenue Refunding Bonds, S/F Mortgage Program, Series E, 3.60% due 8/31/1999 16,140
Pennsylvania-- 36,700 Allegheny County, Pennsylvania, Higher Education Building Authority,
2.6% University Revenue Bonds (Carnegie Mellon University), VRDN, 2.85%
due 12/01/2033 (h) 36,700
Allegheny County, Pennsylvania, Hospital Development Authority
Revenue Bonds (Presbyterian Health Center), VRDN (f)(h):
4,800 Series A, 3.15% due 3/01/2020 4,800
6,100 Series C, 3.15% due 3/01/2020 6,100
23,500 Allegheny County, Pennsylvania, IDA, Revenue Bonds (Duquesne
Pollution Project), CP, Series A, 2.90% due 4/15/1999 23,500
19,000 Berks County, Pennsylvania, IDA, Revenue Bonds (Healthcare-Lutheran
Services), VRDN, Series A, 3.05% due 1/01/2028 (a)(h) 19,000
2,500 Butler County, Pennsylvania, IDA, IDR, Refunding (Wetterau Finance
Co. Project), VRDN, 3.15% due 12/01/2014 (h) 2,500
5,600 Delaware County, Pennsylvania, IDA, PCR (BP Oil Inc. Project),
UPDATES, 2.90% due 12/01/2009 (h) 5,600
15,700 Delaware County, Pennsylvania, IDA, PCR, Refunding (Philadelphia
Electric Company), VRDN, Series A, 2.85% due 8/01/2016 (h) 15,700
Eagle Tax-Exempt Trust, Pennsylvania GO, VRDN(h):
18,735 Series 94, Class 3803, 3.15% due 5/01/2008 18,735
12,870 Series 96C, Class 4301, 3.11% due 5/01/2015 12,870
35,000 Emmaus, Pennsylvania, General Authority Revenue Bonds, VRDN,
3.05% due 12/01/2028 (e)(h) 35,000
12,000 Lackawanna County, Pennsylvania, GO, MSTR, VRDN, Series SGB-38,
3.16% due 9/15/2020 (h) 12,000
Pennsylvania State Higher Education Assistance Agency, Student
Loan Revenue Bonds, VRDN, AMT (h)(i):
11,200 Series A, 3.10% due 1/01/2018 11,200
5,000 Series B, 3.10% due 7/01/2018 5,000
18,010 Pennsylvania State Higher Educational Facilities Authority,
College and University Revenue Bonds (Temple University), FLOATS,
2.85% due 10/01/2009 (b)(h) 18,010
3,200 Pennsylvania State Higher Educational Facilities Authority, Revenue
Refunding Bonds (Carnegie Mellon University), VRDN, Series B, 2.85%
due 11/01/2027 (h) 3,200
19,000 Philadelphia, Pennsylvania, GO, TRAN, Series A, 4.25% due 6/30/1999 19,028
5,200 Schuylkill County, Pennsylvania, IDA, Resource Recovery Revenue
Refunding Bonds (Northeastern Power Company), VRDN, Series A, 3%
due 12/01/2022 (h) 5,200
South Carolina-- Berkeley County, South Carolina, Exempt Facilities, Industrial Revenue
2.4% Bonds (Amoco Chemical Company Project), VRDN, AMT (h):
15,300 3.05% due 4/01/2027 15,300
5,700 3.05% due 4/01/2028 5,700
2,000 Berkeley County, South Carolina, Pollution Control Facilities,
Revenue Refunding Bonds (Amoco Chemical Company Project), VRDN, 2.85%
due 7/01/2012 (h) 2,000
Charleston County, South Carolina, School District GO:
17,150 3.50% due 2/01/2000 17,208
44,000 BAN, Series B, 4% due 4/30/1999 44,018
13,500 Charleston, South Carolina, GO, TAN, 3.50% due 3/15/2000 13,563
14,850 Eagle Tax-Exempt Trust, South Carolina Public Works, VRDN, Series 96A,
3.11% due 1/01/2022 (h) 14,850
Florence County, South Carolina, Solid Waste Disposal and Wastewater
Treament Revenue Bonds (Roche Carolina Inc. Project), VRDN, AMT (h):
35,000 3.10% due 4/01/2026 35,000
19,200 3.10% due 4/01/2027 19,200
</TABLE>
<TABLE>
CMA TAX-EXEMPT FUND
SCHEDULE OF INVESTMENTS AS OF MARCH 31, 1999 (CONTINUED) (IN THOUSANDS)
<CAPTION>
Face Value
State Amount Issue (Note 1a)
<S> <C> <S> <C>
South Carolina South Carolina Jobs EDA, Economic Development Revenue Bonds,
(concluded) VRDN, AMT (h):
$ 4,430 (Saint Francis Hospital), 2.90% due 7/01/2022 $ 4,430
5,400 (Wellman Inc. Project), 3.15% due 12/01/2010 5,400
12,095 (Wellman Inc. Project), 3.15% due 12/01/2012 12,095
South Carolina State Public Service Authority, Electric Revenue
and Electric System Expansion Revenue Bonds, CP:
11,500 2.95% due 5/05/1999 11,500
10,000 3% due 7/28/1999 10,000
York County, South Carolina, PCR (North Carolina Electric Project):
10,460 Series 84N-3, 3% due 9/15/1999 10,460
15,000 Series 84N-6, 3% due 9/15/1999 15,000
South Dakota-- 13,300 Lawrence County, South Dakota, Solid Waste Disposal Revenue Bonds
0.1% (Homestake
Mining), VRDN, AMT, Series A, 3.05% due 7/01/2032 (h) 13,300
Tennessee-- 24,500 Clarksville, Tennessee, Public Building Authority Revenue Bonds, Pooled
1.5% Financing (Tennessee Municipal Bond Fund), VRDN, 3% due 11/01/2027 (h) 24,500
9,400 Cleveland, Tennessee, IDB, Revenue Bonds (Newly Weds Project),
VRDN, AMT, 3.15% due 1/01/2012 (h) 9,400
8,100 Loudon, Tennessee, IDB, Revenue Refunding Bonds (A.E. Staley
Manufacturing Co. Project), VRDN, 3.05% due 9/01/2001 (h) 8,100
13,000 Montgomery County, Tennessee, Public Building Authority, Pooled
Financing Revenue Bonds (Montgomery County Loan), VRDN, 3%
due 7/01/2019 (h) 13,000
Sevier County, Tennessee, Public Building Authority Revenue
Bonds, VRDN (a)(h):
8,000 Local Government Public Improvement II, Series F-3, 3% due 6/01/2005 8,000
10,000 Local Government Public Improvement III, Series D-2, 3% due 6/01/2017 10,000
Shelby County, Tennessee, CP, Series 97-B:
9,000 3% due 5/03/1999 9,000
5,000 3% due 5/06/1999 5,000
19,500 2.95% due 5/12/1999 19,500
22,000 Tennessee State, GO, VRDN, Series A, 3.05% due 7/01/2001 (h) 22,000
21,000 Tennessee State Local Development Authority Revenue Bonds, State
Loan Programs, BAN, Series A, 4% due 5/19/1999 21,007
Texas--17.9% 12,000 Austin, Texas, Travis and Williamson Counties Combined Utility
Local, CP, 3% due 5/04/1999 12,000
10,000 Brazos River Authority, Texas, Harbor Navigational District,
Brazoria County Revenue Bonds (BASF Corp.), VRDN, AMT, 3.10%
due 4/01/2032 (h) 10,000
Brazos River Authority, Texas, PCR, Refunding (Texas Utilities
Electric Company), VRDN, AMT (h):
8,400 Series A, 3.10% due 3/01/2026 (a) 8,400
9,700 Series A, 3.10% due 2/01/2032 (f) 9,700
24,005 Series B, 2.95% due 2/01/2032 (f) 24,005
15,800 Series C, 3.10% due 6/01/2030 (a) 15,800
8,400 Series C, 3.10% due 2/01/2032 (f) 8,400
15,600 Brazos River Authority, Texas, PCR (Texas Utilities Electric
Company), VRDN, AMT, Series A, 3.10% due 4/01/2030 (h) 15,600
20,100 Coastal Bend Health Facilities Development Corp., Texas,
Revenue Bonds (Incarnate World Health System), UPDATES, Series B,
3.075% due 8/15/2028 (a)(h) 20,100
4,000 Corpus Christi, Texas, Industrial Development Crop, IDR
(Dedietrich USA Incorporated Project), VRDN, 3.20% due 11/01/2008 (h) 4,000
Dallas-Fort Worth, Texas, Regional Airport Revenue Bonds,
VRDN, AMT (f)(h):
15,785 Series SGB-46, 3.12% due 11/01/2020 15,785
25,300 Series SGB-49, 3.05% due 11/01/2023 25,300
9,495 Series SGB-52, 3.12% due 11/01/2017 9,495
</TABLE>
<TABLE>
CMA TAX-EXEMPT FUND
SCHEDULE OF INVESTMENTS AS OF MARCH 31, 1999 (CONTINUED) (IN THOUSANDS)
<CAPTION>
Face Value
State Amount Issue (Note 1a)
<S> <C> <S> <C>
Texas $ 6,600 Dallas-Fort Worth, Texas, Regional Airport Revenue Refunding Bonds,
(continued) MSTR, VRDN, Series SGB-5, 3.16% due 11/01/2015 (c)(h) $ 6,600
9,900 Eagle Tax-Exempt Trust, Dallas-Fort Worth, Texas, VRDN,
Series 96C, Class 4301, 2.90% due 11/01/2005 (h) 9,900
5,300 Grapevine, Texas, Industrial Development Corporation, Airport
Revenue Refunding Bonds (Southern Air Transport), VRDN,
3.05% due 3/01/2010 (h) 5,300
7,300 Gulf Coast IDA, Texas, Marine Terminal Revenue Bonds
(Amoco Oil Company Project), VRDN, AMT, 3.05% due 4/01/2028 (h) 7,300
Gulf Coast IDA, Texas, Solid Waste Disposal Revenue Bonds
(Citgo Petroleum Corporation Project), VRDN, AMT (h):
13,700 3.10% due 5/01/2025 13,700
7,400 3.10% due 4/01/2026 7,400
28,500 Gulf Coast Waste Disposal Authority, Texas, Environmental
Facilities Revenue Refunding Bonds (Amoco Oil Company Project),
VRDN, AMT, 3.05% due 1/01/2026 (h) 28,500
Gulf Coast Waste Disposal Authority, Texas, PCR (Amoco Oil
Company Project), VRDN, AMT (h):
42,200 3.05% due 5/01/2023 42,200
36,300 3.05% due 6/01/2024 36,300
Gulf Coast Waste Disposal Authority, Texas, PCR, Refunding, VRDN (h):
10,000 (Amoco Oil Company Project), 3% due 10/01/2017 10,000
14,400 (Exxon Project), 2.85% due 6/01/2020 14,400
32,800 Gulf Coast Waste Disposal Authority, Texas, Revenue Bonds
(Amoco Oil Company Project), VRDN, AMT, 3.05% due 7/01/2027 (h) 32,800
Gulf Coast Waste Disposal Authority, Texas, Revenue Refunding
Bonds (Amoco Oil Company Project), VRDN, AMT (h):
37,600 3.05% due 8/01/2023 37,600
19,500 3.05% due 5/01/2024 19,500
17,710 Harris County, Texas, FLOATS, Series SG-45, 3.07% due 8/15/2016 (h) 17,710
10,000 Harris County, Texas, GO, Refunding, 3% due 10/01/1999 (f) 9,851
Harris County, Texas, GO, Refunding, Toll Road, Sub-Lien, VRDN (h):
31,900 Series B, 2.95% due 8/01/2015 31,900
20,870 Series D, 2.95% due 8/01/2015 20,870
5,000 Series E, 2.95% due 8/01/2015 5,000
25,000 Series H, 3% due 8/01/2020 25,000
145,200 Harris County, Texas, Health Facilities Development Corporation,
Hospital Revenue Bonds (Methodist Hospital), VRDN, 2.90% due 12/01/2026 (h) 145,200
11,700 Harris County, Texas, Health Facilities Development Corporation,
Hospital Revenue Refunding Bonds (Memorial Hospital System Project),
VRDN, Series B, 3.15% due 6/01/2024 (f)(h) 11,700
172,650 Harris County, Texas, Health Facilities Development Corporation,
Hospital Revenue Refunding Bonds (Methodist Hospital), VRDN,
2.90% due 12/01/2025 (h) 172,650
Harris County, Texas, Industrial Development Corporation, PCR, VRDN (h):
7,900 2.85% due 3/01/2024 7,900
8,100 (Exxon Project), AMT, 3.10% due 8/15/2027 8,100
12,000 Harris County, Texas, Industrial Development Corporation, Revenue
Refunding Bonds (Shell Oil Company Project), VRDN, 3% due 4/01/2027 (h) 12,000
Harris County, Texas, Industrial Development Corporation, Solid
Waste Disposal Revenue Bonds, VRDN, AMT (h):
46,100 (Deer Park Limited Partnership), Series A, 3.20% due 2/01/2023 46,100
11,000 (Exxon Project), 3% due 4/01/2033 11,000
24,200 Hockley County, Texas, Industrial Development Corporation, PCR
(Amoco Project-Standard Oil Company), 2.90% due 9/01/1999 24,200
12,430 Lower Colorado River Authority, Texas, Revenue Refunding Bonds,
Junior Lien, VRDN, Third Supplemental Series, 3.10% due 1/01/2013 (f)(h) 12,430
21,900 Lubbock, Texas, Health Facilities Development Corporation, Revenue
Refunding Bonds (Saint Joseph Health System), VRDN, 3% due 7/01/2013 (h) 21,900
14,955 Morristown, Tennessee, IDB, Revenue Refunding Bonds (Akzo Chemicals, Inc.
Project), VRDN, 3.05% due 8/01/2001 (h) 14,955
</TABLE>
<TABLE>
CMA TAX-EXEMPT FUND
SCHEDULE OF INVESTMENTS AS OF MARCH 31, 1999 (CONTINUED) (IN THOUSANDS)
<CAPTION>
Face Value
State Amount Issue (Note 1a)
<S> <C> <S> <C>
Texas North Central Texas Health Facility Development Corporation Revenue
(concluded) Bonds (Methodist Hospitals Dallas), Series B:
$22,000 CP, 2.90% due 4/08/1999 $ 22,000
17,200 VRDN, 2.90% due 10/01/2015 (f)(h) 17,200
North Texas Higher Education Authority Inc., Student Loan Revenue
Bonds, VRDN, AMT (a)(h)(i):
12,800 Series C, 3.10% due 4/01/2020 12,800
13,700 Series F, 3.10% due 4/01/2020 13,700
North Texas Higher Education Authority Inc., Student Loan Revenue
Refunding Bonds, VRDN, AMT (h):
27,900 3.10% due 3/01/2005 27,900
26,000 3.05% due 12/01/2032 26,000
29,000 Series A, 3.10% due 4/01/2005 29,000
5,000 Series A, 3.10% due 4/01/2020 (a) 5,000
Panhandle-Plains, Texas, Higher Education Authority Incorporated,
Student Loan Revenue Bonds, VRDN, AMT, Series A (h):
9,000 3.15% due 6/01/2021 9,000
13,700 3.15% due 6/01/2025 13,700
4,700 Panhandle-Plains, Texas, Higher Education Authority Incorporated,
Student Loan Revenue Refunding Bonds, VRDN, AMT, Series A, 3.15%
due 6/01/2008 (h) 4,700
20,000 Port Arthur, Texas, Navigation District Revenue Bonds
(BASF Corporation Project), VRDN, AMT, 3.10% due 4/01/2033 (h) 20,000
14,400 Port Arthur, Texas, Navigation District, Revenue Refunding Bonds
(Texaco Inc. Project), VRDN, 2.90% due 10/01/2024 (h) 14,400
18,800 Port Corpus Christi, Texas, Industrial Development Corporation,
Sewer and Solid Waste Revenue Bonds (Citgo Petroleum Corporation
Project), VRDN, AMT, 3.10% due 4/01/2026 (h) 18,800
20,600 Sabine River Authority, Texas, PCR, Refunding (Texas Utilities
Electric Company Project), VRDN, Series A, 3% due 3/01/2026 (a)(h) 20,600
15,900 Sabine River Authority, Texas, PCR (Texas Utilities Electric
Company Project), VRDN, AMT, Series B, 3.05% due 3/01/2026 (a)(h) 15,900
13,400 San Antonio, Texas, Higher Education Authority, Revenue Refunding
Bonds (Trinity University Project), VRDN, 3.10% due 4/01/2004 (h) 13,400
10,000 San Antonio, Texas, Hotel Occupancy Revenue Bonds, FLOATS,
Series SG-51, 3.07% due 8/15/2019 (h) 10,000
52,200 South Texas Higher Education Authority Incorporated Revenue
Bonds, VRDN, AMT, 3.15% due 12/01/2027 (f)(h) 52,200
11,300 Southwest Texas Higher Education Authority Incorporated,
Revenue Refunding Bonds (Southern Methodist University), VRDN,
2.90% due 7/01/2015 (h) 11,300
35,645 Texas State, GO, Refunding (Veterans Housing Assistance Fund I),
VRDN, 3.05% due 12/01/2016 (h) 35,645
11,300 Texas State, GO, Series B, 5% due 10/01/1999 11,404
Texas State Public Finance Authority Revenue Bonds, CP:
20,000 Series A, 3% due 5/06/1999 20,000
7,000 Series B, 3% due 5/03/1999 7,000
141,538 Texas State TRAN, 4.50% due 8/31/1999 142,259
22,770 Texas State Tender Option Certificates, VRDN, Series BTP-240,
3.20% due 10/01/2008 (h) 22,770
28,400 Texas State, Water Development Board, VRDN, Series A, 2.90%
due 3/01/2015 (h) 28,400
21,700 Texas Technology University Revenue Bonds (Board of Regents),
CP, Series A, 2.75% due 5/10/1999 21,700
21,200 Trinity River Authority, Texas, PCR, Refunding (Utilities
Electric Company), VRDN, AMT, Series A, 3.10% due 3/01/2026 (a)(h) 21,200
20,300 West Side Calhoun County, Texas, Development Revenue Bonds
(Sohio Chemical Company Project), VRDN, 2.90% due 12/01/2015 (h) 20,300
4,200 West Side Calhoun County, Texas, Navigation District Sewer and
Solid Waste District Revenue Bonds (BP Chemicals Inc. Project),
VRDN, AMT, 3.05% due 4/01/2031 (h) 4,200
</TABLE>
<TABLE>
CMA TAX-EXEMPT FUND
SCHEDULE OF INVESTMENTS AS OF MARCH 31, 1999 (CONTINUED) (IN THOUSANDS)
<CAPTION>
Face Value
State Amount Issue (Note 1a)
<S> <C> <S> <C>
Utah--2.4% $74,600 Emery County, Utah, PCR, Refunding (Pacificorp Projects), VRDN,
2.90% due 11/01/2024 (a)(h) $ 74,600
Intermountain Power Agency, Utah, Power Supply CP:
5,000 Series B-3, 2.85% due 5/07/1999 5,000
10,000 Series B-3, 3.15% due 5/07/1999 10,000
15,500 Series F, 3.15% due 5/07/1999 15,500
6,180 Jordan, Utah, School District, Tender Option Certificates, VRDN,
Series BTP-252, 3.25% due 6/15/2007 (h) 6,180
10,000 Salt Lake City, Utah, Revenue Bonds, Pooled, VRDN, Class A, 3.05%
due 1/01/2020 (h) 10,000
Salt Lake County, Utah, PCR, Refunding (Service Station Holdings
Project), VRDN (h):
36,900 2.85% due 2/01/2008 36,900
35,205 Series B, 2.90% due 8/01/2007 35,205
6,000 Utah State Board of Regents, Student Loan Revenue Bonds, VRDN,
AMT, Series C, 3.10% due 11/01/2013 (a)(h) 6,000
33,500 Utah State Board of Regents, Student Loan Revenue Refunding Bonds,
VRDN, AMT, Series L, 3.10% due 11/01/2025 (a)(h) 33,500
Vermont--0.3% 25,775 Vermont State Student Assistance Corporation, Student Loan
Revenue Bonds, FLOATS, 3% due 1/01/2004 (h) 25,775
Virginia--1.4% 8,885 Eagle Tax-Exempt Trust, Virginia, VRDN, Series 95, Class 4602,
3.06% due 1/15/2013 (h) 8,885
7,720 Fairfax County, Virginia, Sewer Revenue Bonds, 7% due 11/15/1999 (a)(g) 8,051
51,000 Metropolitan Washington D.C. Airports Authority, Virginia, General
Airport Revenue Refunding Bonds, VRDN, AMT, Series C, 3.05%
due 10/01/2027 (h) 51,000
Norfolk, Virginia, IDA Revenue Bonds (Sentara Hospital), CP, Series A:
24,600 2.90% due 4/09/1999 24,600
30,000 2.90% due 4/12/1999 30,000
16,000 Rockingham County, Virginia, IDA, PCR (Merck & Co., Inc.
Project), FLOATS, Series A, 3.25% due 10/01/2020 (h) 16,000
Washington-- 17,025 Eagle Tax-Exempt Trust, Washington, GO, VRDN, Series 96C, Class 4704,
3.6% 3.10% due 4/01/2011 (h) 17,025
31,000 King County, Washington, CP, Series A, 2.95% due 6/08/1999 31,000
30,200 Snohomish County, Washington, Public Utility District Number 001,
Electric Revenue Bonds (Generation System), VRDN, 3.05% due 1/01/2025 (f)(h) 30,200
Washington State Housing Finance Commission, M/F Housing Revenue
Bonds (Arbors on the Park Project), VRDN, AMT (h):
6,400 3.25% due 10/01/2024 6,400
10,335 3.15% due 1/01/2026 10,335
5,000 Washington State Housing Finance Commission Revenue Bonds,
S/F Program Notes, AMT, Series 1A-S, 3% due 2/01/2000 (d) 5,000
6,000 Washington State Housing Finance Commission Revenue Refunding
Bonds, S/F Program Notes, Series 1N-S, 2.95% due 2/01/2000 (d) 6,000
Washington State Public Power Supply Systems, Nuclear Project
Revenue Refunding Bonds, VRDN (h):
5,700 Series 1A-1, 3.05% due 7/01/2017 5,700
23,485 Series 1A-2, 2.95% due 7/01/2017 23,485
Washington State Public Power Supply Systems, Project Number 2,
Electric Revenue Refunding Bonds, VRDN (f)(h):
25,000 Series 2A-1, 3.05% due 7/01/2012 25,000
58,430 Series 2A-2, 2.95% due 7/01/2012 58,430
120,000 Washington State Public Power Supply Systems, Project Number 3,
Electric Revenue Refunding Bonds, Series 3A, 3% due 10/06/1999 (f) 120,000
8,400 Yakima County, Washington, Public Corporation Revenue Bonds
(Macro Plastics Inc. Project), VRDN, AMT, 3.10% due 12/01/2026 (h) 8,400
West Virginia-- 11,220 Hancock County, West Virginia, County Commission, IDR, Refunding
0.3% (The Boc Group Inc. Project), VRDN, 3.05% due 8/01/2005 (h) 11,220
13,600 Marshall County, West Virginia, PCR (Mountaineer Carbon Co.),
UPDATES, 2.90% due 12/01/2020 (h) 13,600
</TABLE>
<TABLE>
CMA TAX-EXEMPT FUND
SCHEDULE OF INVESTMENTS AS OF MARCH 31, 1999 (CONCLUDED) (IN THOUSANDS)
<CAPTION>
Face Value
State Amount Issue (Note 1a)
<S> <C> <S> <C>
Wisconsin-- $14,850 Eagle Tax-Exempt Trust, Wisconsin Ball Park, VRDN, Series 98,
2.1% Class 4901, 2.95% due 12/15/2026 (h) $ 14,850
1,560 Eagle Tax-Exempt Trust, Wisconson Housing and Economy, VRDN,
Series 94C, Class 4901, 3.11% due 9/01/2015 (h) 1,560
6,090 Hartland, Wisconsin, IDR (Commercial Communications Inc.
Project), VRDN, AMT, 3.20% due 8/01/2009 (h) 6,090
115,000 Milwaukee, Wisconsin, RAN, Series A, 3.50% due 2/24/2000 115,564
19,000 Pleasant Prairie, Wisconsin, Pollution Revenue Refunding Bonds
(Wisconsin Electric Power Company), VRDN, Series C, 3.05% due 9/01/2030 (h) 19,000
16,000 Sheboygan, Wisconsin, PCR, Refunding (Wisconsin Power and
Light Company Project), VRDN, Series A, 2.90% due 9/01/2015 (h) 16,000
14,500 Wisconsin State Health and Educational Facilities Authority
Revenue Bonds (Wheaton Franciscan Services), VRDN, 3.05% due 8/15/2016 (h) 14,500
12,375 Wisconsin State Tender Option Certificates, Series BTP-241, 3% due 8/25/1999 12,375
Wyoming--1.8% 13,000 Lincoln County, Wyoming, PCR (Exxon Project), DATES, Series A,
2.90% due 11/01/2014 (h) 13,000
Lincoln County, Wyoming, PCR (Exxon Project), VRDN, AMT (h):
26,300 Series A, 3% due 7/01/2017 26,300
9,000 Series B, 3% due 7/01/2017 9,000
10,960 Lincoln County, Wyoming, PCR, Refunding (Pacificorp Projects),
VRDN, 2.90% due 11/01/2024 (a)(h) 10,960
Sublette County, Wyoming, PCR (Exxon Project)(h):
17,150 DATES, 2.85% due 11/01/2014 17,150
10,200 VRDN, AMT, Series B, 3.10% due 7/01/2017 10,200
Sweetwater County, Wyoming, PCR, Refunding, VRDN (h):
13,900 (Idaho Power Company Project), Series C, 3% due 7/15/2026 13,900
12,000 (Pacificorp Project), 2.90% due 11/01/2024 (a) 12,000
18,000 (Pacificorp Project), Series A, 3.05% due 7/01/2015 18,000
Uinta County, Wyoming, PCR, Refunding (Chevron USA Inc.
Project), VRDN (h):
44,750 2.95% due 8/15/2020 44,750
500 2.95% due 12/01/2022 500
Total Investments (Cost--$9,759,772++)--100.3% 9,759,772
Liabilities in Excess of Other Assets--(0.3%) (29,641)
----------
Net Assets--100.0% $9,730,131
==========
<FN>
(a)AMBAC Insured.
(b)Escrowed to Maturity.
(c)FGIC Insured.
(d)FNMA/GNMA Collateralized.
(e)FSA Insured.
(f)MBIA Insured.
(g)Prerefunded.
(h)The interest rate is subject to change periodically based upon
prevailing market rates. The interest rate shown is the rate in
effect at March 31, 1999.
(i)SLMA Collateralized.
++Cost for Federal income tax purposes.
See Notes to Financial Statements.
</TABLE>
<TABLE>
CMA TAX-EXEMPT FUND
STATEMENT OF ASSETS AND LIABILITIES AS OF MARCH 31, 1999
<S> <C> <C>
Assets:
Investments, at value (identified cost--$9,759,772,203)(Note 1a) $ 9,759,772,203
Cash 119,216
Receivables:
Interest $ 61,080,615
Securities sold 280,849 61,361,464
---------------
Prepaid registration fees and other assets (Note 1d) 6,924,599
---------------
Total assets 9,828,177,482
---------------
Liabilities:
Payables:
Securities purchased 90,791,130
Investment adviser (Note 2) 3,385,431
Distributor (Note 2) 2,987,993
Dividends to shareholders (Note 1e) 290 97,164,844
---------------
Accrued expenses and other liabilities 881,182
---------------
Total liabilities 98,046,026
---------------
Net Assets $ 9,730,131,456
===============
Net Assets Consist of:
Shares of beneficial interest, $0.10 par value, unlimited number of shares
authorized $ 973,167,328
Paid-in capital in excess of par 8,757,541,175
Accumulated realized capital losses--net (Note 4) (577,047)
---------------
Net Assets--Equivalent to $1.00 per share based on 9,731,673,276 shares of
beneficial interest outstanding $ 9,730,131,456
===============
See Notes to Financial Statements.
</TABLE>
<TABLE>
CMA TAX-EXEMPT FUND
STATEMENT OF OPERATIONS FOR THE YEAR ENDED MARCH 31, 1999
<S> <C> <C>
Investment Income (Note 1c):
Interest and amortization of premium and discount earned $ 314,847,678
Expenses:
Investment advisory fees (Note 2) $ 35,897,862
Distribution fees (Note 2) 11,618,652
Transfer agent fees (Note 2) 1,482,266
Registration fees (Note 1d) 858,903
Accounting services (Note 2) 386,107
Custodian fees 260,045
Printing and shareholder reports 155,318
Professional fees 87,507
Pricing fees 53,879
Trustees' fees and expenses 46,582
Other 98,489
---------------
Total expenses 50,945,610
---------------
Investment income--net 263,902,068
Realized Gain on Investments--Net (Note 1c) 323,017
---------------
Net Increase in Net Assets Resulting from Operations $ 264,225,085
===============
See Notes to Financial Statements.
</TABLE>
<TABLE>
CMA TAX-EXEMPT FUND
STATEMENTS OF CHANGES IN NET ASSETS
<CAPTION>
For the Year Ended
March 31,
Increase (Decrease) in Net Assets: 1999 1998
<S> <C> <C>
Operations:
Investment income--net $ 263,902,068 $ 266,097,242
Realized gain on investments--net 323,017 544,094
--------------- ---------------
Net increase in net assets resulting from operations 264,225,085 266,641,336
--------------- ---------------
Dividends to Shareholders (Note 1e):
Investment income--net (263,902,068) (266,025,682)
--------------- ---------------
Net decrease in net assets resulting from dividends to shareholders (263,902,068) (266,025,682)
--------------- ---------------
Beneficial Interest Transactions (Note 3):
Net proceeds from sale of shares 33,522,924,440 31,377,164,577
Net asset value of shares issued to shareholders in reinvestment of
dividends (Note 1e) 263,901,186 266,028,068
--------------- ---------------
33,786,825,626 31,643,192,645
Cost of shares redeemed (33,413,722,416) (30,634,380,592)
--------------- ---------------
Net increase in net assets derived from beneficial interest
transactions 373,103,210 1,008,812,053
--------------- ---------------
Net Assets:
Total increase in net assets 373,426,227 1,009,427,707
Beginning of year 9,356,705,229 8,347,277,522
--------------- ---------------
End of year $ 9,730,131,456 $ 9,356,705,229
=============== ===============
See Notes to Financial Statements.
</TABLE>
<TABLE>
CMA TAX-EXEMPT FUND
FINANCIAL HIGHLIGHTS
<CAPTION>
The following per share data and ratios have been derived
from information provided in the financial statements.
For the Year Ended March 31,
Increase (Decrease) in Net Asset Value: 1999 1998 1997 1996 1995
<S> <C> <C> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of year $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
---------- ---------- ---------- ---------- ----------
Investment income--net .03 .03 .03 .03 .03
Realized gain (loss) on investments--net --++ --++ --++ --++ --++
---------- ---------- ---------- ---------- ----------
Total from investment operations .03 .03 .03 .03 .03
---------- ---------- ---------- ---------- ----------
Less dividends from investment income--net (.03) (.03) (.03) (.03) (.03)
---------- ---------- ---------- ---------- ----------
Net asset value, end of year $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
========== ========== ========== ========== ==========
Total Investment Return 2.87% 3.16% 3.00% 3.31% 2.76%
========== ========== ========== ========== ==========
Ratios to Average Net Assets:
Expenses .55% .55% .55% .55% .55%
========== ========== ========== ========== ==========
Investment income--net 2.83% 3.11% 2.94% 3.26% 2.70%
========== ========== ========== ========== ==========
Supplemental Data:
Net assets, end of year (in thousands) $9,730,131 $9,356,705 $8,347,278 $8,164,160 $7,391,964
========== ========== ========== ========== ==========
<FN>
++Amount is less than $.01 per share.
See Notes to Financial Statements.
</TABLE>
CMA TAX-EXEMPT FUND
NOTES TO FINANCIAL STATEMENTS
1. Significant Accounting Policies:
CMA Tax-Exempt Fund (the "Fund") is registered under the Investment
Company Act of 1940 as a no-load, diversified, open-end management
investment company. The Fund's financial statements are prepared in
accordance with generally accepted accounting principles which may
require the use of management accruals and estimates. The following
is a summary of significant accounting policies followed by the
Fund.
(a) Valuation of investments--Investments are valued at amortized
cost, which approximates market value. For the purpose of valuation,
the maturity of a variable rate demand instrument is deemed to be
the next coupon date on which the interest rate is to be adjusted.
In the case of a floating rate instrument, the remaining maturity is
the demand notice payment period.
(b) Income taxes--It is the Fund's policy to comply with the
requirements of the Internal Revenue Code applicable to regulated
investment companies and to distribute all of its taxable income to
its shareholders. Therefore, no Federal income tax provision is
required.
(c) Security transactions and investment income--Security
transactions are recorded on the dates the transactions are entered
into (the trade dates). Interest income (including amortization of
premium and discount) is recognized on the accrual basis. Realized
gains and losses on security transactions are determined on the
identified cost basis.
(d) Prepaid registration fees--Prepaid registration fees are charged
to expense as the related shares are issued.
(e) Dividends and distributions to shareholders--The Fund declares
dividends daily and reinvests daily such dividends (net of non-
resident alien tax and back-up withholding tax withheld) in
additional fund shares at net asset value. Dividends are declared
from the total of net investment income, excluding discounts earned
other than original issue discounts. Net realized capital gains, if
any, are normally distributed annually after deducting prior years'
loss carryforward. The Fund may distribute capital gains more
frequently than annually in order to maintain the Fund's net asset
value at $1.00 per share.
2. Investment Advisory Agreement and
Transactions with Affiliates:
The Fund has entered into an Investment Advisory Agreement with Fund
Asset Management, L.P. ("FAM"). The general partner of FAM is
Princeton Services, Inc. ("PSI"), an indirect wholly-owned
subsidiary of Merrill Lynch & Co., Inc. ("ML & Co."), which is the
limited partner.
FAM is responsible for the management of the Fund's portfolio and
provides the necessary personnel, facilities, equipment and certain
other services necessary to the operations of the Fund. For such
services, the Fund pays a monthly fee based upon the average daily
value of the Fund's net assets at the following annual rates: 0.50%
of the Fund's average daily net assets not exceeding $500 million;
0.425% of the average daily net assets in excess of $500 million but
not exceeding $1 billion; and 0.375% of the average daily net assets
in excess of $1 billion.
Pursuant to the Distribution and Shareholder Servicing Plan in
compliance with Rule 12b-1 under the Investment Company Act of 1940,
Merrill Lynch, Pierce, Fenner & Smith Incorporated ("MLPF&S")
receives a distribution fee from the Fund at the end of each month
at the annual rate of 0.125% of the average daily net assets of the
Fund. The distribution fee is to compensate MLPF&S financial
consultants and other directly involved branch office personnel for
selling shares of the Fund and for providing direct personal
services to shareholders. The distribution fee is not compensation
for the administrative and operational services rendered to the Fund
by MLPF&S in processing share orders and administering shareholder
accounts.
CMA TAX-EXEMPT FUND
NOTES TO FINANCIAL STATEMENTS (CONCLUDED)
Financial Data Services, Inc. ("FDS"), a wholly-owned subsidiary of
ML & Co., is the Fund's transfer agent.
Accounting services are provided to the Fund by FAM at cost.
Certain officers and/or trustees of the Fund are officers and/or
directors of FAM, PSI, FDS, and/or ML & Co.
3. Shares of Beneficial Interest:
The number of shares purchased and redeemed during the periods
corresponds to the amounts included in the Statements of Changes in
Net Assets for net proceeds from sale of shares and cost of shares
redeemed, respectively, since shares are recorded at $1.00 per
share.
4. Capital Loss Carryforward:
At March 31, 1999, the Fund had a net capital loss carryforward of
approximately $629,000, all of which expires in 2003. This amount
will be available to offset like amounts of any future taxable
gains.
<AUDIT-REPORT>
CMA TAX-EXEMPT FUND
INDEPENDENT AUDITORS' REPORT
The Board of Trustees and Shareholders,
CMA Tax-Exempt Fund:
We have audited the accompanying statement of assets and
liabilities, including the schedule of investments, of CMA Tax-
Exempt Fund as of March 31, 1999, the related statements of
operations for the year then ended and changes in net assets for
each of the years in the two-year period then ended, and the
financial highlights for each of the years in the five-year period
then ended. These financial statements and the financial highlights
are the responsibility of the Fund's 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.
Our procedures included confirmation of securities owned at March
31, 1999 by correspondence with the custodian and brokers. An audit
also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the
overall financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.
In our opinion, such financial statements and financial highlights
present fairly, in all material respects, the financial position of
CMA Tax-Exempt Fund as of March 31, 1999, the results of its
operations, the changes in its net assets, and the financial
highlights for the respective stated periods in conformity with
generally accepted accounting principles.
Deloitte & Touche LLP
Princeton, New Jersey
May 14, 1999
</AUDIT-REPORT>
CMA TAX-EXEMPT FUND
IMPORTANT TAX INFORMATION (UNAUDITED)
All of the net investment income distributions paid daily by CMATax-
Exempt Fund during its taxable year ended March 31, 1999 qualify as
tax-exempt interest dividends for Federal income tax purposes.
Additionally, there were no capital gains distributed by the Fund
during the year.
Please retain this information for your records.
CMA TAX-EXEMPT FUND
OFFICERS AND TRUSTEES
Terry K. Glenn--President and Trustee
Ronald W. Forbes--Trustee
Cynthia A. Montgomery--Trustee
Charles C. Reilly--Trustee
Kevin A. Ryan--Trustee
Richard R. West--Trustee
Arthur Zeikel--Trustee
Vincent R. Giordano--Senior Vice President
Peter J. Hayes--Vice President
Kenneth A. Jacob--Vice President
Helen Marie Sheehan--Vice President
Donald C. Burke--Vice President and Treasurer
Robert Harris--Secretary
Gerald M. Richard, Treasurer of CMA Tax-ExemptFund has recently
retired. His colleagues at Merrill Lynch Asset Management, L.P. join
the Fund's Board of Trustees in wishing Mr. Richard well in his
retirement.
Custodian
State Street Bank and Trust Company
P.O. Box 1713
Boston, MA 02101
Transfer Agent
Financial Data Services, Inc.
4800 Deer Lake Drive East
Jacksonville, FL 32246-6484
(800) 221-7210*
[FN]
*For inquiries regarding your CMA account,
call (800) CMA-INFO [(800) 262-4636].
