(2_FIDELITY_LOGOS)SPARTAN(Registered trademark)
INTERMEDIATE MUNICIPAL
FUND
SEMIANNUAL REPORT
FEBRUARY 28, 1994
CONTENTS
PRESIDENT'S MESSAGE 3 Ned Johnson on minimizing taxes.
PERFORMANCE 4 How the fund has done over time.
FUND TALK 7 The manager's review of fund
performance, strategy, and outlook.
INVESTMENT CHANGES 10 A summary of major shifts in the
fund's investments over the past six
months.
INVESTMENTS 11 A complete list of the fund's
investments with their market value.
FINANCIAL STATEMENTS 20 Statements of assets and liabilities,
operations, and changes in net
assets, as well as financial
highlights.
NOTES 24 Footnotes to the financial
statements.
THIS REPORT AND THE FINANCIAL STATEMENTS CONTAINED HEREIN ARE SUBMITTED FOR
THE GENERAL
INFORMATION OF THE SHAREHOLDERS OF THE FUND. THIS REPORT IS NOT AUTHORIZED
FOR
DISTRIBUTION TO PROSPECTIVE INVESTORS IN THE FUND UNLESS PRECEDED OR
ACCOMPANIED BY
AN EFFECTIVE PROSPECTUS. NEITHER THE FUND NOR FIDELITY DISTRIBUTORS
CORPORATION IS A
BANK, AND FUND SHARES ARE NOT BACKED OR GUARANTEED BY ANY BANK OR INSURED
BY THE
FDIC.
PRESIDENT'S MESSAGE
DEAR SHAREHOLDER:
No one wants to pay more taxes than they have to. But a recent survey of
500 U.S. households, conducted by Fidelity and Yankelovich Partners, showed
that few people took steps to reduce their taxes under the new tax laws
that went into effect last year. In fact, many people were not completely
aware of the changes until they filed their 1993 tax returns.
Whether or not you're someone whose tax bill increased as a result of these
changes, it may make sense to consider ways to keep more of what you earn.
First, if your employer offers a 401(k) or 403(b) retirement savings plan,
consider enrolling. These plans are set up so you can make regular
contributions -
before taxes - to a retirement savings plan. They offer a disciplined
savings strategy, the ability to accumulate earnings tax-deferred, and
immediate tax savings. For example, if you earn $40,000 a year and
contribute 7% of your salary to your 401(k) plan, your annual contribution
is $2,800. That reduces your taxable income to $37,200 and, if you're in
the
28% tax bracket, saves you $784 in federal taxes. In addition, you pay no
taxes on any earnings until withdrawal.
It may be a good idea to contact your benefits office as soon as possible
to find out when you can enroll or increase your contribution. Most
employers allow employees to make changes only a few times each year.
Second, consider an IRA. Many people are eligible to make an IRA
contribution (up to $2,000) that is fully tax deductible. That includes
people who are not covered by company pension plans, or those within
certain income brackets. Even if you don't qualify for a fully deductible
contribution, any IRA earnings will grow tax-deferred until withdrawal.
Third, consider tax-free investments like municipal bonds and municipal
bond funds. Often these can provide higher after-tax yields than comparable
taxable investments. For example, if you're in the new 36% federal income
tax bracket and invest $10,000 in a taxable investment yielding 7%, you'll
pay $252 in federal taxes and receive $448 in income. That same $10,000
invested in a tax-free bond fund yielding 5.5% would allow you to keep $550
in income.
These are three investment strategies that could help lower your tax bill
in 1994. If you're interested in learning more, please call us at
1-800-544-8888 or visit a Fidelity Investor Center. We look forward to
talking with you.
Best regards,
Edward C. Johnson 3d, Chairman
PERFORMANCE: THE BOTTOM LINE
There are several ways to evaluate a fund's historical performance. You can
look at the total percentage change in value, the average annual percentage
change, or the growth of a hypothetical $10,000 investment. Each figure
includes changes in a fund's share price, reinvestment of any dividends (or
income) and capital gains (the profits the fund earns when it sells bonds
that have grown in value), and the effect of the $5 account closeout fee.
You can also look at the fund's income. If Fidelity had not reimbursed
certain fund expenses during the periods shown, the total returns,
dividends and yields would have been lower.
CUMULATIVE TOTAL RETURNS
PERIODS ENDED FEBRUARY 28, 1994 PAST 6 LIFE OF
MONTHS FUND
Spartan Intermediate Municipal 1.47% 6.77%
Lehman Brothers Municipal Bond Index 1.05% n/a
Average Intermediate Municipal Bond Fund 1.25% n/a
Consumer Price Index 1.31% 1.88%
CUMULATIVE TOTAL RETURNS show the fund's performance in percentage terms
over a set period - in this case, six months or since the fund started on
April 26, 1993. For example, if you invested $1,000 in a fund that had a 5%
return over the past year, you would end up with $1,050. You can compare
these figures to the performance of the Lehman Brothers Municipal Bond
Index - a broad measure of the municipal bond market. To measure how the
fund stacked up against its peers, you can look at the average intermediate
municipal bond fund, which reflects the performance of 81 similar funds
tracked by Lipper Analytical Services. Both benchmarks include reinvested
dividends and capital gains, if any. Comparing the fund's performance to
the Consumer Price Index helps show how your fund did compared to
inflation. (The periods covered by the CPI numbers are the closest
available match to those covered by the fund).
AVERAGE ANNUAL TOTAL RETURNS
AVERAGE ANNUAL TOTAL RETURNS take the fund's actual (or cumulative) return
and show you what would have happened if the fund had performed at a
constant rate each year. In the fund's next report we'll report these
numbers for the fund and the benchmarks.
$10,000 OVER LIFE OF FUND
Spartan Int Muni LB Municipal
04/30/93 10000.00 10000.00
05/31/93 10042.52 10056.00
06/30/93 10223.32 10223.94
07/31/93 10237.67 10237.23
08/31/93 10494.62 10450.16
09/30/93 10638.84 10569.29
10/31/93 10653.55 10589.37
11/30/93 10584.30 10496.19
12/31/93 10814.45 10717.66
01/31/94 10921.60 10839.84
02/28/94 10650.21 10559.09
$10,000 OVER LIFE OF FUND: Let's say you invested $10,000 in Spartan
Intermediate Municipal Fund on April 30, 1993, shortly after the fund
started. As the chart shows, by February 28, 1994, the value of your
investment with dividends reinvested would have grown to $10,650 - a 6.50%
increase on your initial investment. This assumes you still owned the fund
on February 28, 1994, and therefore does not include the effect of the $5
account closeout fee. For comparison, look at how the Lehman Brothers
Municipal Bond Index did over the same period. With dividends reinvested,
the same $10,000 would have grown to $10,559 - a 5.59% increase.
UNDERSTANDING
PERFORMANCE
How a fund did yesterday is
no guarantee of how it will do
tomorrow. Bond prices, for
example, move in the
opposite direction of interest
rates. In turn, the share price,
return, and yield of a fund
that invests in bonds will vary.
That means if you sell your
shares during a market
downturn, you might lose
money. But if you can ride out
the market's ups and downs,
you may have a gain.
(checkmark)
INCOME
APRIL 26, 1993
SIX MONTHS (COMMENCEM
ENDED ENT OF
FEBRUARY 28, OPERATIONS) TO
1994 AUGUST 31,
1993
Income return 2.45% 1.82%
Capital gain return 0.38% 0.00%
Change in share price -1.36% 3.39%
Total return 1.47% 5.21%
INCOME returns, capital gain returns, and changes in share price are all
part of a bond fund's total return. An income return reflects the dividends
paid by the fund. A capital gain return reflects the amount paid by the
fund to shareholders based on the profits it has from selling bonds that
have grown in value. Both returns assume the dividends or gains are
reinvested. Changes in the fund's share price include changes in the prices
of the bonds owned by the fund. Change in share price and total return
figures include the effect of the $5 account closeout fee.
DIVIDENDS AND YIELD
PERIODS ENDED FEBRUARY 28, 1994 PAST 30 PAST 6 LIFE OF
DAYS MONTHS FUND
Dividends per share n/a 25.49(cents) 43.22(cents)
Annualized dividend rate n/a 4.95% 8.48%
Annualized yield 5.02% n/a n/a
Tax-equivalent yield 7.84% n/a n/a
DIVIDENDS per share show the income paid by the fund for a set period. If
you annualize this number, based on an average share price of $10.39 over
the past six months and $10.28 over the life of fund, you can compare the
fund's income over these two periods. The 30-day annualized YIELD is a
standard formula for all funds based on the yields of the bonds in the
fund, averaged over the past 30 days. This figure shows you the yield
characteristics of the fund's investments at the end of the period. It also
helps you compare funds from different companies on an equal basis. The
tax-equivalent yield shows what you would have to earn on a taxable
investment to equal the fund's tax-free yield, if you're in the 36% tax
bracket.
FUND TALK: THE MANAGER'S OVERVIEW
An interview with David Murphy,
Portfolio Manager of Spartan
Intermediate Municipal Fund
Q. DAVID, HOW DID THE FUND DO?
A. For the six months ended February 28, 1994, the fund had a total return
of 1.47%. That was ahead of the average intermediate municipal bond fund's
return of 1.25% for the same period, according to Lipper Analytical
Services.
Q. HOW DID YOU COME OUT AHEAD?
A. Having a longer-than-average duration - about 7.7 years at the end of
February - helped the fund when interest rates fell, as they generally did
during the period. Duration is a measure of how much a bond's price will
vary with changes in interest rates. Typically, the longer the duration,
the more a bond's price will rise as interest rates fall. In February,
however, when the Federal Reserve raised short-term interest rates by a
quarter of a percentage point, having a longer duration hurt the fund.
Q. IN LIGHT OF THE FED'S MOVE, DID YOU CHANGE YOUR STRATEGY?
A. Since I'm somewhat concerned about interest rates rising over the short
term, I have recently started to shorten the fund's duration a bit.
However, I haven't radically altered it, leaving it positioned to take
advantage of falling interest rates over the next few years. That's based
on my view that the Fed is very serious about being the inflation watchdog.
Low inflation is generally good for bonds. Historically, a pick-up in the
economy, such as we saw in the fourth quarter of 1993, means higher
inflation. But this time, I don't think that relationship will hold up.
Q. WHY NOT?
A. Because I think that inflation is low, lower than the market has
anticipated. We still haven't seen a broad-based increase in any of the
three basic components of higher inflation: commodity prices, labor costs
and the cost of borrowing money. While it's true that some commodity
prices, like gold, grains and copper, have risen, others, like oil,
haven't. Plus, some of the hike in agricultural prices can be attributed to
extraordinary factors like last year's flood and the recent cold weather.
Q. AND THE TWO OTHER INFLATIONARY
SIGNALS?
A. On the wage side, many U.S. companies now have the flexibility to move
their production overseas, where labor prices are often cheaper, and that
has kept pressure on domestic labor costs. Also, productivity has
increased, which means the actual cost of producing one unit of a given
good has come down. Finally, the cost of borrowing money or raising capital
is still low. In my view, these all add up to continued low inflation,
which could in turn lead to falling interest rates, especially in the
intermediate and longer end of the maturity spectrum - between 10 and 30
years.
Q. WHAT CHOICES HAVE YOU MADE IN TERMS OF MATURITY?
A. I've concentrated a large amount of the fund - 42.5% at the end of
February - in bonds with 10 to 15-year maturities. Up to 15 years, the
yield curve, meaning the difference in yield between bonds of different
maturities, is steep. That means you get rewarded with more yield for
buying a 12-year bond, for instance, than a bond in the five-year range.
Beyond 15 years, the yield curve is flat and you don't get rewarded much
for buying a longer-term bond. For example, a 12-year AAA-rated bond can
pay over 90% of the yield of a 30-year bond. This was balanced by bonds in
the 7- to 10-year range, which made up about 35% of the fund's investments
at the end of the period.
Q. IN WHAT STATES DID YOU FOCUS?
A. The fund's largest state concentrations were Texas at 14.7%, New York at
13.5%, and California at 12.5%. Texas bonds are attractive, in part,
because the state's economy is fairly healthy. I also favored
state-appropriated New York bonds. These rely on annual appropriations by
the legislature to meet debt service. State-appropriated bonds were
downgraded in 1992 to Baa. But we believe there's a likelihood that they'll
be upgraded in the next year, which should boost their prices. Over the
past six months, I have sold some California bonds. I continue to hold the
remainder because I think the state's economy is at a turning point. I also
believe we should see evidence of expansion soon, even though that
expansion initially will be modest.
Q. THE FUND'S LARGEST STAKE WAS IN DENVER AIRPORT BONDS AT 6.5% OF THE
FUND'S ASSETS. WERE THEY HURT WHEN THE NEW AIRPORT OPENING WAS DELAYED?
A. Yes, and that was disappointing. But the delay is only temporary and was
caused by some kinks that developed in the new airport's baggage handling
system. The bonds also suffered some on the news that Continental Airlines
will cut back on the number of flights they make to that destination.
There's some speculation that Continental might withdraw from the hub all
together, leaving United Airlines as the only carrier. But I continue to
hold the bonds for a couple reasons. First, the airport is a
state-of-the-art facility which was built at a reasonable cost. Second, I
believe the airport is viable even if United Airlines is the sole carrier
into Denver.
Q. WHAT DO YOU THINK INVESTORS CAN EXPECT FOR THE NEXT SIX MONTHS?
A. More volatility. The municipal bond market seems to be expecting the Fed
to raise short-term interest rates to 4%. Until that happens, the market
will probably remain unsettled. But eventually, I believe long-term
municipal rates will start to fall again, and that intermediate rates could
come down as well. Plus, the dwindling supply of municipal bonds should
help. Last year, the total supply of municipals issued was about $290
billion. This year, it's expected to be about half of that. Falling
interest rates and dwindling supply would be positive for municipal bond
prices.
FUND FACTS
GOAL: to provide current
income exempt from federal
income tax by investing
primarily in high-grade and
medium grade securities
START DATE: April 26, 1993
SIZE: as of February 28,
1994, over $294 million
MANAGER: David Murphy
since May 1993; manager,
Spartan California
Intermediate Municipal
Portfolio, since December
1993; Spartan New York
Intermediate Municipal
Portfolio, since December
1993; Spartan
Short-Intermediate Municipal
Fund, since December 1989;
Spartan New Jersey
Municipal High Yield Portfolio,
since April 1991; Fidelity
Limited Term Municipals,
since December 1989
(checkmark)
DAVID MURPHY ON INTERMEDIATE
BONDS:
"I think that intermediate
bonds in the five- to 15-year
range will once again be
attractive in 1994. The yield
curve - or the difference in
yield between bonds with
various maturities - is very
steep up to15 years. A
15-year AAA bond pays about
5.5% yield, compared to a
five-year bond which pays
only 4.5%. But in the 15- to
30-year range, the curve
starts to flatten. In that longer
range, you only get rewarded
with about one-quarter of a
percent in incremental yield.
What's more, some
institutional investors have
started to increase their
investments in intermediate
bonds. That increased
demand could be an
additional positive for
intermediate municipal bond
prices."
(bullet) On February 28, the fund's
largest sector concentration
was education bonds which
made up 23.8% of the fund's
investments. Most of these
were student loan bonds,
which were attractive in part
because loan defaults are
reimbursed by the federal
government and the bonds
usually carry a high rating.
They also offer relatively high
yields.
(bullet) On February 28, the fund's
second largest sector was
local and state general
obligation bonds (GOs),
which are backed by the
taxing power of the issuer.
The fund focused on GOs that
offered relatively high yields.
INVESTMENT CHANGES
TOP FIVE STATES AS OF FEBRUARY 28, 1994
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
6 MONTHS AGO
Texas 14.7 12.8
New York 13.5 11.1
California 12.5 18.0
Colorado 7.3 6.5
Washington 4.4 5.0
TOP FIVE SECTORS AS OF FEBRUARY 28, 1994
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
6 MONTHS AGO
Education 23.8 26.4
General Obligation 18.4 15.6
Transporation 11.8 9.7
Special Tax 10.6 4.5
Health Care 10.3 7.8
AVERAGE YEARS TO MATURITY AS OF FEBRUARY 28, 1994
6 MONTHS AGO
Years 9.9 9.3
AVERAGE YEARS TO MATURITY SHOWS THE AVERAGE TIME UNTIL THE PRINCIPAL OF THE
BONDS IN THE FUND IS EXPECTED TO BE REPAID, WEIGHTED BY DOLLAR AMOUNT.
DURATION AS OF FEBRUARY 28, 1994
6 MONTHS AGO
Years 7.7 7.3
DURATION SHOWS HOW MUCH A BOND'S PRICE FLUCTUATES WITH CHANGES IN INTEREST
RATES. IF RATES RISE 1%, FOR EXAMPLE, THE SHARE PRICE OF A FUND WITH A
FIVE-YEAR DURATION WILL FALL 5%.
QUALITY DIVERSIFICATION AS OF FEBRUARY 28, 1994
(MOODY'S RATINGS)
Aaa 41.4%
Aa, A 27.0%
Baa 31.1%
Non-rated 0.5%
Row: 1, Col: 1, Value: 1.8
Row: 1, Col: 2, Value: 31.1
Row: 1, Col: 3, Value: 27.0
Row: 1, Col: 4, Value: 41.4
THIS CHART EXCLUDES SHORT-TERM INVESTMENTS. WHERE MOODY'S RATINGS ARE NOT
AVAILABLE, WE HAVE USED S&P RATINGS.
INVESTMENTS FEBRUARY 28, 1994 (UNAUDITED)
Showing Percentage of Total Value of Investment in Securities
MUNICIPAL BONDS - 95.6%
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
ALASKA - 4.2%
North Slope Borough (Cap. Appreciation)
Series A:
0% 6/30/01, (MBIA Insured) Aaa $ 12,000,000 $ 8,400,000
0% 6/30/02, (MBIA Insured) Aaa 3,950,000 2,616,875
0% 6/30/03, (MBIA Insured) Aaa 2,000,000 1,260,000
12,276,875
ARIZONA - 1.0%
Maricopa County School Dist. #28 Rfdg.
(Kyrene Elementary) Series C, 0% 1/1/07,
(FGIC Insured) Aaa 5,900,000 2,927,875
CALIFORNIA - 12.0%
ABAG Fin. Auth. Nonprofit Corps. Ctfs. of Prtn.
(Stanford Univ. Hosp.) 5.25% 11/1/06 Aa 2,100,000 2,118,375
California Pub. Wks. Board Lease Rev.
Rfdg. (Dept. of Correction State Prisons)
Series A, 5.25% 12/1/04 A1 4,075,000 4,044,438
California Statewide Commty. Dev. Auth. Rev.
Ctfs. of Prtn.:
Rfdg. (Hosp. Triad Healthcare) 5.90% 8/1/01 A+ 1,115,000 1,127,544
(Insured Health Facs. Eskaton, Inc.)
5.70% 5/1/05 A+ 1,610,000 1,618,050
Carson Redev. Agcy. Rfdg. (Redev. Proj. Area 2)
(Tax Allocation):
5.40% 10/1/01 Baa 1,350,000 1,344,938
5.50% 10/1/02 Baa 1,320,000 1,315,050
5.60% 10/1/03 Baa 1,500,000 1,494,375
5.625% 10/1/04 Baa 1,085,000 1,074,150
Central Valley Fin. Auth. Cogeneration Proj. Rev.
(Carson Ice Gen. Proj.):
5.50% 7/1/01 BBB- 2,300,000 2,294,250
5.60% 7/1/02 BBB- 1,800,000 1,795,500
5.80% 7/1/04 BBB- 1,300,000 1,296,750
Clovis Unified School Dist. (Cap. Appreciation)
Series B, 0% 8/1/02 A1 5,700,000 3,662,250
Fresno Swr. Rev. Series A-1, 4.90% 9/1/07,
(AMBAC Insured) Aaa 4,475,000 4,357,531
Los Angeles Hosp. Rev. Ctfs. of Prtn.
(Insured Health Facs. Construction Loan Prog.)
(Hollywood Presbyterian Hosp.) 9% 7/1/13 A 100,000 106,250
MUNICIPAL BONDS - CONTINUED
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
CALIFORNIA - CONTINUED
Orange County Agcy. Tax Allocation
(Santa Ana Heights Proj.):
5.70% 9/1/02 Baa1 $ 1,170,000 $ 1,165,613
6% 9/1/05 Baa1 1,335,000 1,328,325
San Bernardino County Ctfs. of Prtn.
(Med. Ctr. Fin. Proj.) 5% 8/1/03 Baa1 2,000,000 1,902,500
Sequoia Hosp. Dist. Rev. Rfdg.:
5.10% 8/15/04 A 1,345,000 1,321,463
5.25% 8/15/05 A 1,415,000 1,395,544
34,762,896
COLORADO - 7.3%
Colorado Health Facs. Auth. Rev. (Rocky
Mountain Adventist) 6.25% 2/1/04 Baa 2,000,000 2,057,500
Denver City & County Arpt. Rev.:
Series A:
8.25% 11/15/02 (c) Baa1 730,000 823,988
0% 11/15/04 (c) Baa1 2,070,000 1,071,225
Series C:
6.55% 11/15/03 (c) Baa1 2,660,000 2,746,450
6.50% 11/15/06 (c) Baa1 3,500,000 3,565,625
Series D:
7.50% 11/15/02 (c) Baa1 3,090,000 3,399,000
0% 11/15/03 (c) Baa1 5,320,000 2,939,300
(Cap. Appreciation) Series D:
6.35% 11/15/01 (c) Baa1 2,000,000 2,040,000
0% 11/15/06 (c) Baa1 5,500,000 2,502,500
21,145,588
CONNECTICUT - 1.3%
Connecticut Health & Ed. Facs. Auth. Rev.
(Quinnipiac College) Series D:
4.90% 7/1/98 BBB- 2,600,000 2,596,750
5.625% 7/1/03 BBB- 1,100,000 1,097,250
3,694,000
DISTRICT OF COLUMBIA - 2.4%
District of Columbia Hosp. Rev. Rfdg.
(Medlantic Healthcare Group, Washington
Hosp. Ctr.):
Series A, 5.50% 8/15/06, (MBIA Insured) Aaa 1,100,000 1,113,750
Series B, 6.125% 8/15/99 Baa1 4,520,000 4,683,850
District of Columbia Series E, 6% 6/1/12 Baa 850,000 860,625
MUNICIPAL BONDS - CONTINUED
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
DISTRICT OF COLUMBIA - CONTINUED
District of Columbia Unltd. Tax Series B, 6%
6/1/02, (MBIA Insured) Aaa $ 150,000 $ 160,125
6,818,350
GEORGIA - 0.2%
Muni. Elec. Auth. Spl. Oblig. 3rd Crossover
6.20% 1/1/03 A1 500,000 541,250
HAWAII - 1.9%
Hawaii Arpt. Sys. Rev. 2nd Series 6.70%
7/1/05, (MBIA Insured) (c) Aaa 5,000,000 5,493,750
ILLINOIS - 4.4%
Chicago O'Hare Intl. Arpt. Rev. Series A,
5.80% 1/1/04 (c) A1 4,310,000 4,428,525
Illinois Dev. Fin. Auth. Poll. Cont. Rev. Rfdg.
(Commonwealth Edison) 5.30% 1/15/04 Baa2 2,500,000 2,453,125
Illinois Univ. Rev. (Auxiliary Facs. Sys.):
0% 4/1/07, (MBIA Insured) Aaa 2,500,000 1,221,875
0% 4/1/08, (MBIA Insured) Aaa 3,645,000 1,672,144
Metropolitan Pier & Exposition Auth.
Dedicated Tax Rev. (McCormick Place
Expansion Proj.) Series A, 0% 6/15/09,
(FGIC Insured) Aaa 5,000,000 2,093,750
Western Illinois Univ. Rev. Rfdg. (Auxiliary Facs.)
0% 4/1/08, (MBIA Insured) Aaa 1,890,000 855,225
12,724,644
IOWA - 1.6%
Iowa Student Loan Liquidity Corp. Student Loan
Rev. Rfdg. Sr. Series B, 5.75% 12/1/07 (c) Aaa 4,500,000 4,500,000
MARYLAND - 2.9%
Maryland Health & Higher Ed. Facs. Auth. Rev.
Rfdg. (Howard County General) 5.125%
7/1/03 Baa1 2,220,000 2,189,475
Northeast Maryland Waste Disp. Auth. Solid
Waste Rev. (Montgomery County Resource
Recovery Proj.) Series A:
5.80% 7/1/04 (c) A 3,375,000 3,446,719
6% 7/1/07 (c) A 1,000,000 1,016,250
Prince George County Rev. Rfdg. (Dimensions
Health Corp. Proj.) 4.75% 7/1/03 A 1,750,000 1,710,625
8,363,069
MUNICIPAL BONDS - CONTINUED
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
MASSACHUSETTS - 3.9%
New England Ed. Loan Marketing Corp.
Rfdg. (Student Loan):
Series A, 5.70% 7/1/05 (c) A1 $ 7,230,000 $ 7,284,225
Series E, 5% 7/1/99 A1 4,000,000 4,035,000
11,319,225
MICHIGAN - 3.6%
Detroit Convention Facs. Rev. Rfdg. (Cobo Hall
Expansion Proj.) 5.125% 9/30/05 A 10,830,000 10,491,563
MISSISSIPPI - 1.4%
Mississippi Higher Ed. Assistance Corp. Student
Loan Rev. Sr. Series B, 5.10% 9/1/00 Aaa 4,000,000 3,995,000
MONTANA - 4.3%
Montana Higher Ed. Student Loan Assistance
Corp. Student Loan Rev. Sr. Series B, 5%
12/1/00 (c) (f) Aaa 12,580,000 12,611,450
MULTIPLE STATES - 1.2%
New England Ed. Loan Marketing Corp.
Student Loan Rev. Rfdg. Sr. Issue A,
6.50% 9/1/02 Aaa 1,000,000 1,083,750
Washington D.C. Metro. Area Trans. Auth.
Gross Rev. Rfdg. 5% 1/1/07, (FGIC Insured) Aaa 2,500,000 2,440,625
3,524,375
NEBRASKA - 0.3%
Omaha Pub. Pwr. Dist. Elec. Rev. Series A, 6.50%
2/1/17, (Pre-Refunded to 2/1/02 @101.5) (d) Aa 900,000 1,009,125
NEW HAMPSHIRE - 1.4%
New Hampshire Higher Ed. & Health Facs. Auth.
Rev. (Frisbie Mem. Hosp.) 5.70% 10/1/04 Baa 4,145,000 4,041,375
NEW MEXICO - 2.6%
New Mexico Edl. Assistance Foundation
Student Loan Rev. Sr. Series 111 A-1:
5.65% 12/1/03 (c) (e) Aaa 2,830,000 2,773,400
6% 12/1/09 (c) (e) Aaa 5,000,000 4,868,750
7,642,150
NEW YORK - 13.5%
Metropolitan Trans. Auth. Svc. Contract
(Trans. Facs.) Series 7, 0% 7/1/10 Baa1 600,000 226,500
New York City Gen. Oblig.:
Rfdg. Unltd. Tax Series A, 6.25% 8/1/03 Baa1 4,000,000 4,205,000
Short Rites Series C, 8.64% 8/1/03 (g) Baa1 4,000,000 4,365,000
MUNICIPAL BONDS - CONTINUED
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
NEW YORK - CONTINUED
New York City:
Rfdg. Series A, 6.375% 8/1/05 Baa1 $ 1,000,000 $ 1,048,750
Rfdg. Series D, 5.70% 8/15/06 Baa1 2,500,000 2,478,125
Series E, 5.75% 5/15/06 Baa1 1,250,000 1,245,313
New York Ctfs. of Prtn. 6.70% 9/1/97 Baa1 1,800,000 1,919,250
New York State Dorm. Auth. Rev.:
(City Univ. Sys.) Series B, 5.75% 7/1/06 Baa1 1,080,000 1,092,150
(Court Facs. Lease) Series A, 6% 5/15/03 Baa1 5,055,000 5,263,519
(State Univ. Edl. Facs.):
Series A, 5.50% 5/15/07 Baa1 4,660,000 4,590,100
Series B, 5.25% 5/15/04, (FGIC Insured) Aaa 5,000,000 5,087,500
Series C, 7% 5/15/18 (Pre-Refunded to
5/15/00 @ 102) (d) Baa1 1,500,000 1,713,750
0% 7/1/06, (MBIA Insured) (c) Aaa 1,000,000 513,750
0% 7/1/07, (MBIA Insured) (c) Aaa 1,885,000 904,800
New York State Local Gov't. Assistance Corp.
Rfdg. Series E, 6% 4/1/08 A 1,205,000 1,244,163
New York State Pwr. Auth. Rev. & Gen. Purp.
Rfdg. Series CC, 5% 1/1/07 Aa 1,000,000 976,250
New York State Thruway Svc. Contract Rev.
(Local Highway & Bridge) 5.125% 4/1/07 Baa1 2,000,000 1,890,000
Suffolk County Wtr. Auth. 6% 6/1/17,
(MBIA Insured) Aaa 500,000 526,250
39,290,170
NORTH CAROLINA - 2.1%
North Carolina Eastern Muni. Pwr. Agcy. Pwr.
Sys Rev.:
Rfdg. Series B:
5.75% 1/1/04 A 500,000 523,125
6% 1/1/06 A 2,500,000 2,631,250
7.25% 1/1/07 A 2,480,000 2,864,400
6,018,775
OHIO - 1.0%
Franklin County Rev. (Online Computer Library
Ctr. Proj.):
4.80% 4/15/97 - 500,000 500,000
5% 4/15/98 - 560,000 560,700
5.65% 4/15/01 - 340,000 347,225
Ohio Dev. Commty. (Globe Ind. Project) Series 1,
7.75% 6/1/96 (c) A- 230,000 233,163
MUNICIPAL BONDS - CONTINUED
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
OHIO - CONTINUED
Ohio Bldg. Auth. Facs. (Ohio Ctr. Apts.)
Series A, 5.20% 10/1/04 A1 $ 1,375,000 $ 1,378,438
3,019,526
PENNSYLVANIA - 2.9%
Allegheny Arpt. Rev. (Pittsburgh Intl. Arpt.)
Series A, 5.60% 1/1/06, (MBIA Insured) (c) Aaa 1,250,000 1,271,875
Delaware County Unltd. Tax Rfdg. 0%
11/15/02 Aa 3,785,000 2,412,938
Pennsylvania Intergovernmental Co-op Auth. Spl.
Tax (City of Philadelphia) 5.25% 6/15/06,
(FGIC Insured) Aaa 2,500,000 2,487,500
Philadelphia Hosp. & Higher Ed. Facs. Auth.
Hosp. Rev. (Temple Univ. Hosp.) Series A,
5.60% 11/15/97 Baa1 2,100,000 2,176,125
8,348,438
TENNESSEE - 1.2%
Metropolitan Nashville Arpt. Auth. Arpt. Rev.
Series A, 6.60% 7/1/03, (FGIC Insured) (c) Aaa 1,255,000 1,378,931
Tennessee Hsg. Dev. Auth. Mtg. Fin. 5.70%
7/1/08 A1 2,000,000 2,000,000
3,378,931
TEXAS - 12.3%
Brazos Higher Ed. Auth. Student Loan Rfdg.
Series C-1:
5.50% 6/1/02 (c) Aaa 4,680,000 4,738,500
5.60% 6/1/03 (c) Aaa 6,750,000 6,842,813
5.70% 6/1/04 (c) Aaa 2,500,000 2,537,500
Central Texas Higher Ed. Auth. Student Loan
Rev. Rfdg. Sr. Series A, 5.10% 12/1/03 Aaa 5,000,000 4,918,750
Coastal Bend Health Facs. Dev. Corp. (Incarnate
Word. Health Svc.) Series A, 6% 11/15/06,
(AMBAC Insured) Aaa 390,000 416,325
Conroe Independent School Dist. Lot B Rfdg.:
0% 2/1/02, (PSF Guaranteed) Aaa 1,000,000 675,000
0% 2/1/03, (PSF Guaranteed) Aaa 2,025,000 1,288,406
0% 2/1/04, (PSF Guaranteed) Aaa 2,340,000 1,401,075
Cypress Fairbanks Independent School Dist.
Unltd. Tax Rfdg.:
0%, 2/1/02, (PSF Guaranteed) Aaa 5,105,000 3,445,875
0% 2/1/03, (PSF Guaranteed) Aaa 3,710,000 2,360,488
MUNICIPAL BONDS - CONTINUED
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
TEXAS - CONTINUED
Houston Independent School Dist. Rfdg.
(Cap. Appreciation) 0% 8/15/12, (PSF
Guaranteed) Aaa $ 6,000,000 $ 2,062,500
Katy Independent School Dist. Ltd. Tax Rfdg.
Series A, 0% 2/15/07, (PSF Guaranteed) Aaa 400,000 195,500
Socorro Independent School Dist. Unltd. Tax Rfdg.:
0% 9/1/04, (PSF Guaranteed) Aaa 3,000,000 1,740,000
0% 9/1/05, (PSF Guaranteed) Aaa 2,400,000 1,299,000
Texas Muni. Pwr. Agcy. Rev. Rfdg.:
9% 9/1/97, (Escrowed to Maturity) (d) A1 500,000 578,750
0% 9/1/07, (AMBAC Insured) Aaa 2,500,000 1,193,750
35,694,232
UTAH - 0.3%
Salt Lake County Unltd. Tax Wtr. Conservancy Dist.
Rev. (Cap. Appreciation) Series A, 0%
10/1/05, (AMBAC Insured) Aaa 1,650,000 893,063
WASHINGTON - 4.4%
Washington State Pub. Pwr. Supply Sys.:
Nuclear Proj. #2 Rev. 5.60% 7/1/07 Aa 6,000,000 6,090,000
Nuclear Proj. #3 Rev.:
Rfdg. Series B:
0% 7/1/07 Aa 4,000,000 1,885,000
0% 7/1/10 Aa 2,250,000 863,438
0% 7/1/05, (MBIA Insured) Aaa 290,000 159,138
5.10% 7/1/04, (FGIC Insured) Aaa 1,955,000 1,964,775
Rfdg. Series C, 0% 7/1/13 Aa 6,030,000 1,899,450
12,861,801
TOTAL MUNICIPAL BONDS
(Cost $278,982,734) 277,387,496
MUNICIPAL NOTES (B) - 4.4%
CALIFORNIA - 0.5%
California Poll. Cont. Fing. Auth. Resources
Recovery Rev. (Delano Proj.) Series 1991,
2.30%, LOC Algemene/ABN-AMRO Bank,
VRDN P-1 1,500,000 1,500,000
MUNICIPAL NOTES (B) - CONTINUED
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
FLORIDA - 0.6%
Dade County Health Facs. Auth. Hosp. Rev.
(Miami Children's Hosp. Proj.) Series 1990,
2.50%, LOC Barnett Bank, VRDN VMIG 1 $ 1,800,000 $ 1,800,000
PENNSYLVANIA - 0.9%
Schuylkill County Ind. Dev. Auth. Resources
Recovery Rev. (Westwood Energy Prop.)
Series 1985, 2.35%, LOC Fuji Bank, VRDN P-1 2,500,000 2,500,000
TEXAS - 2.4%
Texas Gen. Oblig. TRAN 3.25% 8/31/94 MIG 1 6,800,000 6,815,224
TOTAL MUNICPAL NOTES
(Cost $12,631,280) 12,615,224
TOTAL INVESTMENT IN SECURITIES - 100%
(Cost $291,614,014) $ 290,002,720
SECURITY TYPE ABBREVIATIONS
TRAN - Tax & Revenue Anticipation Notes
VRDN - Variable Rate Demand Notes
LEGEND
1. Standard & Poor's Corporation credit ratings are used in the absence
of a rating by Moody's Investors Service, Inc.
2. The coupon rate shown on floating or adjustable rate securities
represents the rate at period end.
3. Private activity obligations whose interest is subject to the federal
alternative minimum tax for individuals (AMT securities).
4. Security collateralized by an amount sufficient to pay interest and
principal.
5. Security purchased on a delayed delivery basis (see Note 2 of Notes to
Financial Statements).
6. A portion of the Security was pledged to cover margin requirements for
delayed delivery purchases . At the period end, the value of securities
pledged amounted to $8,521,250.
7. Inverse floating rate security is a security where the coupon is
inversely indexed to a floating interest rate. The price will be more
volatile than the price of a comparable fixed rate security.
OTHER INFORMATION
The composition of long-term debt holdings as a percentage of total value
of investment in securities, is as follows (ratings are unaudited):
MOODY'S RATINGS S&P RATINGS
Aaa, Aa, A 60.7% AAA, AA, A 52.0%
Baa 26.6% BBB 22.8%
Ba 0.0% BB 0.0%
B 0.0% B 0.0%
Caa 0.0% CCC 0.0%
Ca, C 0.0% CC, C 0.0%
D 0.0%
The percentage not rated by either S&P or Moody's amounted to 0.5%
The distribution of municipal securities by revenue source, as a percentage
of total value of investment in securities, is as follows:
Education 23.8%
General Obligation 18.4
Transporation 11.8
Special Tax 10.6
Health Care 10.3
Others (individually less than 10%) 25.1
TOTAL 100.0%
INCOME TAX INFORMATION
At February 28, 1994, the aggregate cost of investment securities for
income tax purposes was $291,614,014. Net unrealized depreciation
aggregated $1,611,294, of which $1,339,330 related to appreciated
investment securities and $2,950,624 related to depreciated investment
securities.
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
<S> <C> <C>
FEBRUARY 28, 1994 (UNAUDITED)
ASSETS
Investment in securities, at value (cost $291,614,014) $ 290,002,720
(Notes 1 and 2) - See accompanying schedule
Cash 1,199,478
Receivable for investments sold 9,875,432
Interest receivable 3,464,187
Receivable from investment adviser for expense 81,522
reductions (Note 6)
TOTAL ASSETS 304,623,339
LIABILITIES
Payable for investments purchased $ 1,950,070
Regular delivery
Delayed delivery (Note 2) 7,830,000
Dividends payable 178,517
Accrued management fee 128,106
TOTAL LIABILITIES 10,086,693
NET ASSETS $ 294,536,646
Net Assets consist of (Note 1):
Paid in capital $ 295,625,758
Accumulated undistributed net realized gain (loss) on 522,182
investments
Net unrealized appreciation (depreciation) on investment (1,611,294)
securities
NET ASSETS, for 28,884,822 shares outstanding $ 294,536,646
NET ASSET VALUE, offering price and redemption price per $10.20
share ($294,536,646 (divided by) 28,884,822 shares)
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
<S> <C> <C>
SIX MONTHS ENDED FEBRUARY 28, 1994 (UNAUDITED)
INTEREST INCOME $ 6,846,002
EXPENSES
Management fee (Note 4) $ 732,667
Non-interested trustees' compensation 732
Interest (Note 5) 141
Total expenses before reductions 733,540
Expense reductions (Note 6) (497,115) 236,425
NET INTEREST INCOME 6,609,577
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
(NOTES 1 AND 3)
Net realized gain (loss) on:
Investment securities 1,079,135
Futures contracts 68,215 1,147,350
Change in net unrealized appreciation (depreciation) on (5,193,134)
investment securities
NET GAIN (LOSS) (4,045,784)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM $ 2,563,793
OPERATIONS
</TABLE>
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
<S> <C> <C>
SIX MONTHS APRIL 26, 1993
ENDED FEBRUARY (COMMENCEMENT
28, OF
1994 OPERATIONS) TO
(UNAUDITED) AUGUST 31, 1993
INCREASE (DECREASE) IN NET ASSETS
Operations $ 6,609,577 $ 1,506,911
Net interest income
Net realized gain (loss) on investments 1,147,350 379,011
Change in net unrealized appreciation (depreciation) (5,193,134) 3,581,840
on
investments
NET INCREASE (DECREASE) IN NET ASSETS RESULTING 2,563,793 5,467,762
FROM OPERATIONS
Distributions to shareholders (6,609,577) (1,506,911)
From net interest income
From net realized gain (995,002) -
TOTAL DISTRIBUTIONS (7,604,579) (1,506,911)
Share transactions 219,732,967 231,054,621
Net proceeds from sales of shares
Reinvestment of distributions from: 5,500,505 1,306,002
Net interest income
Net realized gain 883,431 -
Cost of shares redeemed (145,939,223) (16,921,722)
Net increase (decrease) in net assets resulting from 80,177,680 215,438,901
share
transactions
TOTAL INCREASE (DECREASE) IN NET ASSETS 75,136,894 219,399,752
NET ASSETS
Beginning of period 219,399,752 -
End of period $ 294,536,646 $ 219,399,752
OTHER INFORMATION
Shares
Sold 21,123,607 22,755,876
Issued in reinvestment of distributions from: 530,181 127,558
Net interest income
Net realized gain 84,701 -
Redeemed (14,070,310) (1,666,791)
Net increase (decrease) 7,668,179 21,216,643
</TABLE>
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
<S> <C> <C>
SIX MONTHS APRIL 26, 1993
ENDED FEBRUARY (COMMENCEMEN
28, 1994 T OF OPERATIONS)
(UNAUDITED) TO
AUGUST 31, 1993
SELECTED PER-SHARE DATA
Net asset value, beginning of period $ 10.340 $ 10.000
Income from Investment Operations .255 .177
Net interest income
Net realized and unrealized gain (loss) on investments (.100) .340
Total from investment operations .155 .517
Less Distributions (.255) (.177)
From net interest income
From net realized gain on investments (.040) -
Total distributions (.295) (.177)
Net asset value, end of period $ 10.200 $ 10.340
TOTAL RETURN (dagger) (double dagger) 1.48% 5.22%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000 omitted) $ 294,537 $ 219,400
Ratio of expenses to average net assets # .18%* -
Ratio of expenses to average net assets before expense .55%* .55%*
reductions #
Ratio of net interest income to average net assets 4.96%* 5.20%*
Portfolio turnover rate 74%* 95%*
</TABLE>
* ANNUALIZED
(dagger) TOTAL RETURNS DO NOT INCLUDE THE ACCOUNT CLOSEOUT FEE AND FOR
PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED.
(double dagger) THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN
EXPENSES NOT BEEN REDUCED DURING THE PERIODS SHOWN.
# SEE NOTE 6 OF NOTES TO FINANCIAL STATEMENTS
NOTES TO FINANCIAL STATEMENTS
For the period ended February 28, 1994 (Unaudited)
1. SIGNIFICANT ACCOUNTING
POLICIES.
Spartan Intermediate Municipal Fund (the fund) is a fund of Fidelity Union
Street Trust (the trust) and is authorized to issue an unlimited number of
shares. The trust is registered under the Investment Company Act of 1940,
as amended (the 1940 Act), as an open-end management investment company
organized as a Massachusetts business trust. The following summarizes the
significant accounting policies of the fund:
SECURITY VALUATION. Securities are valued based upon a computerized matrix
system and/or appraisals by a pricing service, both of which consider
market transactions and dealer-supplied valuations. Short-term securities
maturing within sixty days are valued either at amortized cost or original
cost plus accrued interest, both of which approxi-
mate current value. Securities for which quotations are not readily
available through the pricing service are valued at their fair value as
determined in good faith under consistently applied procedures under the
general supervision of the Board of Trustees.
INCOME TAXES. As a qualified regulated investment company under Subchapter
M of the Internal Revenue Code, the fund is not subject to income taxes to
the extent that it distributes all of its taxable income for its fiscal
year. The schedule of investments includes information regarding income
taxes under the caption "Income Tax Information."
INTEREST INCOME. Interest income, which includes amortization of premium
and accretion of original issue discount, is accrued as earned.
EXPENSES. Most expenses of the trust can be directly attributed to a fund.
Expenses which cannot be directly attri-
buted are apportioned between the funds in the trust.
DISTRIBUTIONS TO SHAREHOLDERS. Distributions are declared daily and paid
monthly from net interest income. Distributions from realized gains, if
any, are recorded on the ex-dividend date.
Income and capital gain distributions are determined in accordance with
income tax regulations which may differ from generally accepted accounting
principles. These differences are primarily due to differing treatments for
futures transactions and losses deferred due to wash sales. The fund also
utilized earnings and profits distributed to share-
holders on redemption of shares as a part of the dividends paid deduction
for income tax purposes. Permanent book and tax basis differences relating
to shareholder distributions will result in reclassifications to paid in
capital.
SECURITY TRANSACTIONS. Security transactions are accounted for as of trade
date. Gains and losses on securities sold are determined on the basis of
identified cost.
2. OPERATING POLICIES.
DELAYED DELIVERY TRANSACTIONS. The fund may purchase or sell securities on
a when-issued or forward commitment
2. OPERATING POLICIES -
CONTINUED
DELAYED DELIVERY TRANSACTIONS - CONTINUED
basis. Payment and delivery may take place a month or more after the date
of the transaction. The price of the underlying securities and the date
when the securities will be delivered and paid for are fixed at the time
the transaction is negotiated. The fund identifies securities as segregated
in its custodial records with a value at least equal to the amount of the
purchase commitment.
FUTURES CONTRACTS AND OPTIONS. The fund may invest in futures contracts and
write options. These investments involve, to varying degrees, elements of
market risk and risks in excess of the amount recognized in the Statement
of Assets and Liabilities. The face or contract amounts reflect the extent
of the involvement the fund has in the particular classes of instruments.
Risks may be caused by an imperfect correlation between movements in the
price of the instruments and the price of the underlying securities and
interest rates. Risks also may arise if there is an illiquid secondary
market for the instruments, or due to the inability of counterparties to
perform.
Futures contracts are valued at the settlement price established each day
by the board of trade or exchange on which they are traded. Options traded
on an exchange are valued using the last sale price or, in the absence of a
sale, the last offering price. Options traded over-the-counter are valued
using dealer-supplied valuations.
3. PURCHASES AND SALES OF
INVESTMENTS.
Purchases and sales of securities, other than short-term securities,
aggregated $154,967,178 and $95,765,703, respectively.
The market value of futures contracts opened and closed amounted to
$22,426,178 and $22,357,963, respectively.
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES.
MANAGEMENT FEE. As the fund's investment adviser, FMR pays all expenses
except the compensation of the non-
interested Trustees and certain exceptions such as interest, taxes,
brokerage commissions and extraordinary expenses. FMR receives a fee that
is computed daily at an annual rate of .55% of the fund's average net
assets.
FMR also bears the cost of providing shareholder services to the fund. For
the period, FMR or its affiliates collected certain transaction fees from
shareholders which aggregated $4,099.
5. BANK BORROWINGS.
The fund is permitted to have bank borrowings for temporary or emergency
purposes to fund shareholder redemptions. The fund has established
borrowing arrangements with certain banks. Under the most restrictive
arrangement, the fund must pledge to the bank securities having a market
value in excess of 220%
5. BANK BORROWINGS -
CONTINUED
of the total bank borrowings. The interest rate on the borrowings is the
bank's base rate, as revised from time to time. The maximum loan and the
average daily loan balance during the period for which the loan was
outstanding amounted to $1,400,000. The weighted average interest rate
was 3.625%.
6. EXPENSE REDUCTIONS.
FMR voluntarily agreed to reimburse the fund's operating expenses
(excluding interest, taxes, brokerage commissions and extraordinary
expenses) above a specified percentage of average net assets. During the
period, this expense limitation ranged from .10% to .20% of average net
assets and the reimbursement reduced expenses by $497,115.
TO CALL FIDELITY
FOR FUND INFORMATION AND QUOTES
The Fidelity Telephone Connection offers you special automated telephone
services for quotes and balances. The services are easy to use,
confidential and quick. All you need is a Touch Tone telephone.
YOUR PERSONAL IDENTIFICATION NUMBER
(PIN)
The first time you call one of our automated telephone services, we'll ask
you
to set up your Personal Identification
Number (PIN). The PIN assures that
only you have automated telephone
access to your account information.
Please have your Customer Number
(T-account #) handy when you call --
you'll need it to establish your PIN. If
you would ever like to change your PIN, just choose the "Change your
Personal
Identification Number" option when
you call. If you forget your PIN, please
call a Fidelity representative at 1-800-
544-6666 for assistance.
(PHONE_GRAPHIC)(PHONE_GRAPHIC)(PHONE_GRAPHIC)(PHONE_GRAPHIC)(PHONE_GRAPHIC
(PHONE_GRAPHIC)MUTUAL FUND QUOTES*
1-800-544-8544
Just make a selection from this record-ed menu:
PRESS
1. For quotes on funds you own.
2. For an individual fund quote.
3. For the ten most frequently
requested Fidelity fund quotes.
4. For quotes on Fidelity Select
Portfolios(Registered trademark).
5. To change your Personal
Identification Number (PIN).
6. To speak with a Fidelity
representative.
(PHONE_GRAPHIC)(PHONE_GRAPHIC)(PHONE_GRAPHIC)(PHONE_GRAPHIC)(PHONE_GRAPHIC
(PHONE_GRAPHIC)MUTUAL FUND ACCOUNT
BALANCES 1-800-544-7544
Just make a selection from this record-
ed menu:
PRESS
1. For balances on funds you own.
2. For your most recent fund activity
(purchases, redemptions, and
dividends).
3. To change your Personal
Identification Number (PIN).
4. To speak with a Fidelity
representative.
* WHEN YOU CALL THE QUOTES LINE, PLEASE REMEMBER THAT A FUND'S YIELD AND
RETURN WILL
VARY AND, EXCEPT FOR MONEY MARKET FUNDS, SHARE PRICE WILL ALSO VARY. THIS
MEANS THAT
YOU MAY HAVE A GAIN OR LOSS WHEN YOU SELL YOUR SHARES. THERE IS NO
ASSURANCE THAT
MONEY MARKET FUNDS WILL BE ABLE TO MAINTAIN A STABLE $1 SHARE PRICE; AN
INVESTMENT IN
A MONEY MARKET FUND IS NOT INSURED OR GUARANTEED BY THE U.S. GOVERNMENT.
TOTAL
RETURNS ARE HISTORICAL AND INCLUDE CHANGES IN SHARE PRICE, REINVESTMENT OF
DIVIDENDS
AND CAPITAL GAINS, AND THE EFFECTS OF ANY SALES CHARGES. FOR MORE
INFORMATION ON ANY
FIDELITY FUND INCLUDING MANAGEMENT FEES AND CHARGES, CALL 1-800-544-8888
FOR A FREE
PROSPECTUS. READ IT CAREFULLY BEFORE YOU INVEST OR SEND MONEY.
TO VISIT FIDELITY
For directions and hours,
please call 1-800-544-9797.
ARIZONA
7373 N. Scottsdale Road
Scottsdale, AZ
CALIFORNIA
851 Hamilton Avenue
Campbell, CA
527 North Brand Boulevard
Glendale, CA
19100 Von Karman Avenue
Irvine, CA
10100 Santa Monica Blvd.
Los Angeles, CA
811 Wilshire Boulevard
Los Angeles, CA
251 University Avenue
Palo Alto, CA
1760 Challenge Way
Sacramento, CA
7676 Hazard Center Drive
San Diego, CA
455 Market Street
San Francisco, CA
1400 Civic Drive
Walnut Creek, CA
COLORADO
1625 Broadway
Denver, CO
CONNECTICUT
185 Asylum Street
Hartford, CT
265 Church Street
New Haven, CT
300 Atlantic Street
Stamford, CT
DELAWARE
222 Delaware Avenue
Wilmington, DE
FLORIDA
4400 N. Federal Highway
Boca Raton, FL
2249 Galiano Street
Coral Gables, FL
4090 N. Ocean Boulevard
Ft. Lauderdale, FL
4001 Tamiami Trail, North
Naples, FL
32 West Central Boulevard
Orlando, FL
2401 PGA Boulevard
Palm Beach Gardens, FL
8065 Beneva Road
Sarasota, FL
2000 66th Street, North
St. Petersburg, FL
GEORGIA
3525 Piedmont Road, N.E.
Atlanta, GA
1000 Abernathy Road
Atlanta, GA
HAWAII
700 Bishop Street
Honolulu, HI
ILLINOIS
215 East Erie Street
Chicago, IL
One North Franklin
Chicago, IL
540 Lake Cook Road
Deerfield, IL
1415 West 22nd Street
Oak Brook, IL
1700 East Golf Road
Schaumburg, IL
LOUISIANA
201 St. Charles Avenue
New Orleans, LA
MAINE
3 Canal Plaza
Portland, ME
MARYLAND
1 West Pennsylvania Ave.
Towson, MD
7401 Wisconsin Avenue
Bethesda, MD
MASSACHUSETTS
470 Boylston Street
Boston, MA
21 Congress Street
Boston, MA
25 State Street
Boston, MA
300 Granite Street
Braintree, MA
101 Cambridge Street
Burlington, MA
416 Belmont Street
Worcester, MA
MICHIGAN
280 North Woodward Ave.
Birmingham, MI
26955 Northwestern Hwy.
Southfield, MI
MINNESOTA
38 South Sixth Street
Minneapolis, MN
MISSOURI
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(2_FIDELITY_LOGOS)SPARTAN(Registered trademark)
INTERMEDIATE MUNICIPAL
FUND
SEMIANNUAL REPORT
FEBRUARY 28, 1994
CONTENTS
PRESIDENT'S MESSAGE 3 Ned Johnson on minimizing taxes.
PERFORMANCE 4 How the fund has done over time.
FUND TALK 7 The manager's review of fund
performance, strategy, and outlook.
INVESTMENT CHANGES 10 A summary of major shifts in the
fund's investments over the last six
months.
INVESTMENTS 11 A complete list of the fund's
investments with their market value.
FINANCIAL STATEMENTS 25 Statements of assets and liabilities,
operations, and changes in net
assets, as well as financial
highlights.
NOTES 29 Footnotes to the financial
statements.
THIS REPORT AND THE FINANCIAL STATEMENTS CONTAINED HEREIN ARE SUBMITTED FOR
THE GENERAL
INFORMATION OF THE SHAREHOLDERS OF THE FUND. THIS REPORT IS NOT AUTHORIZED
FOR
DISTRIBUTION TO PROSPECTIVE INVESTORS IN THE FUND UNLESS PRECEDED OR
ACCOMPANIED BY
AN EFFECTIVE PROSPECTUS. NEITHER THE FUND NOR FIDELITY DISTRIBUTORS
CORPORATION IS A
BANK, AND FUND SHARES ARE NOT BACKED OR GUARANTEED BY ANY BANK OR INSURED
BY THE
FDIC.
PRESIDENT'S MESSAGE
DEAR SHAREHOLDER:
No one wants to pay more taxes than they have to. But a recent survey of
500 U.S. households, conducted by Fidelity and Yankelovich Partners, showed
that few people took steps to reduce their taxes under the new tax laws
that went into effect last year. In fact, many people were not completely
aware of the changes until they filed their 1993 tax returns.
Whether or not you're someone whose tax bill increased as a result of these
changes, it may make sense to consider ways to keep more of what you earn.
First, if your employer offers a 401(k) or 403(b) retirement savings plan,
consider enrolling. These plans are set up so you can make regular
contributions -
before taxes - to a retirement savings plan. They offer a disciplined
savings strategy, the ability to accumulate earnings tax-deferred, and
immediate tax savings. For example, if you earn $40,000 a year and
contribute 7% of your salary to your 401(k) plan, your annual contribution
is $2,800. That reduces your taxable income to $37,200 and, if you're in
the
28% tax bracket, saves you $784 in federal taxes. In addition, you pay no
taxes on any earnings until withdrawal.
It may be a good idea to contact your benefits office as soon as possible
to find out when you can enroll or increase your contribution. Most
employers allow employees to make changes only a few times each year.
Second, consider an IRA. Many people are eligible to make an IRA
contribution (up to $2,000) that is fully tax deductible. That includes
people who are not covered by company pension plans, or those within
certain income brackets. Even if you don't qualify for a fully deductible
contribution, any IRA earnings will grow tax-deferred until withdrawal.
Third, consider tax-free investments like municipal bonds and municipal
bond funds. Often these can provide higher after-tax yields than comparable
taxable investments. For example, if you're in the new 36% federal income
tax bracket and invest $10,000 in a taxable investment yielding 7%, you'll
pay $252 in federal taxes and receive $448 in income. That same $10,000
invested in a tax-free bond fund yielding 5.5% would allow you to keep $550
in income.
These are three investment strategies that could help lower your tax bill
in 1994. If you're interested in learning more, please call us at
1-800-544-8888 or visit a Fidelity Investor Center. We look forward to
talking with you.
Best regards,
Edward C. Johnson 3d, Chairman
PERFORMANCE: THE BOTTOM LINE
There are several ways to evaluate a fund's historical performance. You can
look at the total percentage change in value, the average annual percentage
change, or the growth of a hypothetical $10,000 investment. Each figure
includes changes in a fund's share price, reinvestment of any dividends (or
income) and capital gains (the profits the fund earns when it sells bonds
that have grown in value), and the effect of the $5 account closeout fee.
You can also look at the fund's income. If Fidelity had not reimbursed
certain fund expenses during the periods shown, the total returns,
dividends and yields would have been lower.
CUMULATIVE TOTAL RETURNS
PERIODS ENDED FEBRUARY 28, 1994 PAST 6 PAST 1 LIFE OF
MONTHS YEAR FUND
Spartan Municipal Income 1.12% 6.58% 44.58%
Lehman Brothers Municipal Bond 1.05% 5.54% n/a
Index
Average General Municipal Bond Fund 0.75% 5.24% n/a
Consumer Price Index 1.31% 2.52% 13.54%
CUMULATIVE TOTAL RETURNS show the fund's performance in percentage terms
over a set period - in this case, six months, one year or since the fund
started on June 4, 1990. For example, if you invested $1,000 in a fund that
had a 5% return over the past year, you would end up with $1,050. You can
compare these figures to the performance of the Lehman Brothers Municipal
Bond index - a broad guage of the municipal bond market. To measure how the
fund stacked up against its peers, you can look at the average general
municipal bond fund, which reflects the performance of 177 municipal bond
funds tracked by Lipper Analytical Services. Both benchmarks include
reinvested dividends and capital gains, if any. Comparing the fund's
performance to the consumer price index helps show how your fund did
compared to inflation.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED FEBRUARY 28, 1994 PAST 1 LIFE OF
YEAR FUND
Spartan Municipal Income 6.58% 10.35%
Lehman Brothers Municipal Bond Index 5.54% n/a
Average General Municipal Bond Fund 0.75% n/a
Consumer Price Index 2.52% 3.44%
AVERAGE ANNUAL TOTAL RETURNS take the fund's actual (or cumulative) return
and show you what would have happened if the fund had performed at a
constant rate each year.
$10,000 OVER LIFE OF FUND
Spartan Muni Income LB Municipal Bond
06/30/90 10000.00 10000.00
07/31/90 10181.47 10147.00
08/31/90 9974.13 9999.87
09/30/90 10017.45 10005.87
10/31/90 10121.87 10186.97
11/30/90 10359.04 10391.73
12/31/90 10425.75 10437.46
01/31/91 10552.62 10577.32
02/28/91 10615.56 10669.34
03/31/91 10668.63 10673.61
04/30/91 10826.12 10815.57
05/31/91 10964.36 10911.83
06/30/91 10953.34 10900.91
07/31/91 11104.20 11033.91
08/31/91 11235.66 11179.55
09/30/91 11366.05 11324.89
10/31/91 11464.39 11426.81
11/30/91 11473.45 11458.81
12/31/91 11749.14 11705.17
01/31/92 11748.27 11732.09
02/29/92 11767.02 11735.61
03/31/92 11790.52 11740.31
04/30/92 11901.96 11844.80
05/31/92 12060.83 11984.56
06/30/92 12251.68 12185.90
07/31/92 12617.13 12551.48
08/31/92 12463.74 12428.48
09/30/92 12528.61 12509.26
10/31/92 12314.71 12386.67
11/30/92 12593.68 12608.39
12/31/92 12733.78 12737.00
01/31/93 12911.16 12884.75
02/28/93 13428.90 13351.18
03/31/93 13302.89 13209.65
04/30/93 13405.33 13343.07
05/31/93 13522.61 13417.79
06/30/93 13771.91 13641.87
07/31/93 13813.56 13659.60
08/31/93 14152.92 13943.72
09/30/93 14341.56 14102.68
10/31/93 14355.77 14129.48
11/30/93 14225.06 14005.14
12/31/93 14556.51 14300.65
01/31/94 14731.99 14463.67
02/28/94 14312.83 14089.06
$10,000 OVER LIFE OF FUND: Let's say you invested $10,000 in Spartan
Municipal Income Portfolio on June 30, 1990, shortly after the fund
started. As the chart shows, by February 28, 1994, the value of your
investment would have grown to $14,313 - a 43.13% increase on your initial
investment. This assumes you still own the fund on February 28, 1994, and
therefore does not include the effect of the $5 account closeout fee. For
comparison, look at how the Lehman Brothers Municipal Bond index did over
the same period. With dividends reinvested, the same $10,000 would have
grown to $14,089 - a 40.89% increase.
UNDERSTANDING
PERFORMANCE
How a fund did yesterday is
no guarantee of how it will do
tomorrow. Bond prices, for
example, move in the
opposite direction of interest
rates. In turn, the share price,
return, and yield of a fund
that invests in bonds will vary.
That means if you sell your
shares during a market
downturn, you might lose
money. But if you can ride out
the market's ups and downs,
you may have a gain.
(checkmark)
INCOME
SIX MONTHS
ENDED
FEBRUARY 28, YEARS ENDED AUGUST 31,
1994 1993 1992 1991
Income return 2.72% 6.69% 7.15% 7.90%
Capital gain return 4.74% 0.70% 0.40% 0.00%
Change in share price -6.34% 6.16% 3.37% 4.74%
Total return 1.12% 13.55% 10.92% 12.64%
INCOME returns, capital gain returns, and changes in share price are all
part of a bond fund's total return. An income return reflects the dividends
paid by the fund. A capital gain return reflects the amount paid by the
fund to shareholders based on the profits it has from selling bonds that
have grown in value. Both returns assume the dividends or gains are
reinvested. Changes in the fund's share price include changes in the prices
of the bonds owned by the fund. Change in share price and total return
figures include the effect of the $5 account closeout fee.
DIVIDENDS AND YIELD
PERIODS ENDED FEBRUARY 28, 1994 PAST 30 PAST 6 PAST 1
DAYS MONTHS YEAR
Dividends per share n/a 30.38(cents) 63.08(cents)
Annualized dividend rate n/a 5.56% 5.70%
Annualized yield 5.41% n/a n/a
Tax-equivalent yield 8.45% n/a n/a
DIVIDENDS per share show the income paid by the fund for a set period. If
you annualize this number, based on an average share price of $11.02 over
the past six months and $11.06 over the past year, you can compare the
fund's income over these two periods. The 30-day annualized YIELD is a
standard formula for all funds based on the yields of the bonds in the
fund, averaged over the past 30 days. This figure shows you the yield
characteristics of the fund's investments at the end of the period. It also
helps you compare funds from different companies on an equal basis. The
tax-equivalent yield shows what you would have to earn on a taxable
investment to equal the fund's tax-free yield, if you're in the 36% tax
bracket.
FUND TALK: THE MANAGER'S OVERVIEW
Interview with Norman Lind, Portfolio Manager of Spartan Municipal Income
Portfolio
Q. NORM, HOW DID THE FUND DO?
A. For the six months ended February 28, 1994, the fund returned 1.12%.
That beat the average municipal bond fund's return of 0.75% for the same
period, according to Lipper Analytical Services.
Q. WHAT WAS YOUR STRATEGY?
A. I invested in bonds that were more sensitive to falling interest rates.
For example, when interest rates fell - as they did for most of the period
- - having a large stake in non-callable bonds helped the fund. These bonds -
which were about 40% of the fund's investments on February 28 - can't be
repaid before their scheduled maturities. They have a long duration, which
is a measure of interest rate sensitivity. That means their prices rise
more as interest rates fall - or fall more as rates rise.
Q. SIX MONTHS AGO, YOU ALSO CREDITED PREMIUM BONDS WITH HELPING THE FUND'S
PERFORMANCE. DID THEY CONTINUE TO WORK IN THE FUND'S FAVOR?
A. Yes, particularly the premium bonds that were pre-refunded. Premium
bonds trade at more than face value because they carry an interest rate
above the current rate for similar bonds. Plus, they trade to their early
call dates rather than to maturity, and so, are less volatile. When these
bonds were pre-refunded the fund benefited. With pre-refunding, the issuer
sells a new lower-interest bond, invests the proceeds in short-term
government securities, and pays off the old bond at the earliest
opportunity which is usually the first call date. The fund's premium bonds
that were pre-refunded became worth more because they were then backed by
the highest-rated government securities.
Q. WHEN THE FEDERAL RESERVE RAISED INTEREST RATES IN FEBRUARY, DID OWNING
THESE TYPES OF BONDS BACKFIRE?
A. Yes - just as the bonds helped the fund when interest rates were
falling, they hurt the fund when interest rates rose. But I think that over
the next several months rates will probably remain stable and could even
begin to fall again by the summer. That's because I interpret the Fed's
move as a pre-emptive strike which I think means it's serious about keeping
inflation in check - which when rising can cause interest rates to rise. In
my view, that move will eventually be positive for the bond market. Plus, I
believe there's no real hard evidence that inflation is going to pick up
again and be a threat.
Q. WHY DO YOU SAY THAT?
A. Because the economy still isn't showing the kind of sustainable robust
pickup you'd normally expect at this stage of a recovery. U.S. job growth
is relatively slow, and there's been no significant improvement in the
world economy that could help ignite a stronger domestic recovery.
Q. TURNING BACK TO YOUR STRATEGY, IN WHICH STATES DID YOU FIND
OPPORTUNITIES?
A. Recently, I built a 13.4% stake in New York, the fund's largest state
concentration on February 28. Most of these bonds are state-appropriated,
which means they rely on annual appropriations by the state legislature to
meet all or part of the principal and interest payments. Recently, New York
issued a large quantity of bonds, so the heavy supply meant the bonds were
cheap relative to where they usually trade. What's more, the state's credit
quality rating stands a pretty good chance of being upgraded over the next
12 months or so. California - the fund's second largest state concentration
at 10.1% - is attractive because it appears the economy and the state's
fiscal situation are finally showing signs of stabilizing. Our research
department has determined that the recent Los Angeles earthquake doesn't
appear to have had any impact on the California bonds in the fund, but it's
something we'll continue to monitor going forward.
Q. HOW HAVE THE FUND'S HOUSING BONDS - WHICH YOU SAID WERE DISAPPOINTING
SIX MONTHS AGO - DONE
RECENTLY?
A. They continued to perform poorly. As interest rates fell, more
homeowners refinanced their older, more expensive mortgages at lower rates.
While that had been going on for a while, it was somewhat surprising just
how fast and far rates dropped. But I may consider adding more housing
bonds to the fund. That's because the housing bonds issued now are at much
lower interest rates. Unless rates drop dramatically, it's hard to picture
a rapid prepayment rate for the newer bonds.
Q. WHAT DO YOU THINK IS AHEAD FOR THE MUNICIPAL BOND MARKET?
A. Most likely more volatility in the short term. And as we've already
started to see, probably more modest returns than last year. That said, I'm
optimistic for a couple of reasons. For one thing, higher federal taxes
could increase demand for municipal bonds. At the same time, supply is
expected to taper off, since many of the refinancings that could legally
take place already have. Increased demand and decreased supply should bode
well for municipal bonds.
Q. WHAT'S YOUR PLAN FOR DEALING WITH A MORE VOLATILE MARKET?
A. I've started to use futures contracts to help hedge the fund against the
market's gyrations. The fund holds mainly longer-term issues because they
provide higher yields. But these bonds are inherently more volatile than
shorter-term bonds. Since my view is that long-term bonds could rally later
in the year, to me it doesn't make sense to sell them now after their
recent price drop. Instead, I'm trying to guard against any short-lived
decline in long-term bond prices by selling interest rate futures
contracts. When long-term bond prices decline, the futures contracts
appreciate. If I see signs that prices are rising, I should be able to sell
these futures positions fairly quickly. This strategy gives me the ability
to keep the fund's basic structure in place for the long run, while helping
to protect it in the short run.
FUND FACTS
GOAL: to provide a high level
of current income exempt
from federal taxes
START DATE: June 4, 1990
SIZE: as of February 28,
1994, over $812 million
MANAGER: Norman Lind,
since June 1990; manager,
Fidelity New York Insured
Tax-Free Portfolio, since
March 1994; Fidelity New
York Tax-Free High Yield
Portfolio and Spartan New
York Tax-Free Port-
folio, since October 1993
(checkmark)
NORM LIND'S INTEREST RATE
OUTLOOK:
"Over the next several
months, I think interest rates
will probably stabilize. Inflation
appears to be in check, and
the Federal Reserve recently
underscored its intention to
fight inflation by raising
short-term interest rates. The
economy still isn't showing the
kind of sustainable robust
pickup you'd normally expect
at this stage of a recovery.
U.S. job growth is relatively
slow, and there's been no
significant improvement in the
world economy that could help
ignite a stronger domestic
recovery."
(bullet) On February 28, about 23%
of the fund was in electric
utility bonds. Supply was
heavy as issuers refinanced
older bonds. Increased supply
translated into inexpensive
prices. With the rate of
refinancings slowing and no
future plans for major
construction projects, the
bonds could rise in value as
supply becomes scarce.
(bullet) Transportation bonds -
the fund's second largest
industry concentration -
grew to 13.8% at the end of
the period. Many of the bonds
added in this period were New
York state-appropriated
transportation bonds. They
were attractive in part because
a heavy supply of New York
bonds made their prices
relatively cheap.
INVESTMENT CHANGES
TOP FIVE STATES AS OF FEBRUARY 28, 1994
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
6 MONTHS AGO
New York 13.4 7.5
California 10.1 10.8
Colorado 7.4 8.8
Washington 6.2 10.1
Georgia 5.0 4.6
TOP FIVE SECTORS AS OF FEBRUARY 28, 1994
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
6 MONTHS AGO
Electric Revenue 22.5 30.2
Transportation 13.8 11.4
Health Care 11.8 10.9
Lease Revenue 11.5 6.8
Industrial Development 9.0 8.1
AVERAGE YEARS TO MATURITY AS OF FEBRUARY 28, 1994
6 MONTHS AGO
Years 20.5 20.6
AVERAGE YEARS TO MATURITY SHOWS THE AVERAGE TIME UNTIL THE PRINCIPAL OF THE
BONDS IN THE FUND IS EXPECTED TO BE REPAID, WEIGHTED BY DOLLAR AMOUNT.
DURATION AS OF FEBRUARY 28, 1994
6 MONTHS AGO
Years 9.3 9.1
DURATION SHOWS HOW MUCH A BOND'S PRICE FLUCTUATES WITH CHANGES IN INTEREST
RATES. IF RATES RISE 1%, FOR EXAMPLE, THE SHARE PRICE OF A FUND WITH A
FIVE-YEAR DURATION WILL FALL 5%.
QUALITY DIVERSIFICATION AS OF FEBRUARY 28, 1994
(MOODY'S RATINGS)
Aaa 23.6%
Aa, A 40.7%
Baa 23.6%
Ba or B 2.1%
Non-rated 7.6%
Row: 1, Col: 1, Value: 7.6
Row: 1, Col: 2, Value: 2.1
Row: 1, Col: 3, Value: 23.6
Row: 1, Col: 4, Value: 40.7
Row: 1, Col: 5, Value: 23.6
THIS CHART EXCLUDES SHORT-TERM INVESTMENTS. WHERE MOODY'S RATINGS ARE NOT
AVAILABLE, WE HAVE USED S&P RATINGS.
INVESTMENTS FEBRUARY 28, 1994 (UNAUDITED)
Showing Percentage of Total Value of Investment in Securities
MUNICIPAL BONDS - 97.6%
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
ALABAMA - 0.2%
Alabama Hsg. Fin. Auth. Single Family Mtg.
Rev. Series 1983 A, 0% 10/1/14 Aa $ 12,070,000 $ 1,448,400 010308GE
ARIZONA - 1.1%
Chandler:
7.375% 7/1/09, (FGIC Insured) Aaa 1,000,000 1,207,500 158843KV
4.375% 7/1/12, (FGIC Insured) Aaa 1,000,000 863,750 158843KZ
Phoenix Civic Impt. Arpt. Excise Tax Rev.
7.80% 7/1/11 Aa 4,000,000 4,435,000 718837CH
Tucson Wtr. Rev. Series D:
9.75% 7/1/07 A1 500,000 707,500 898796VR
9.75% 7/1/08 A1 500,000 703,750 898796VS
9.75% 7/1/09 A1 750,000 1,058,438 898796VT
8,975,938
CALIFORNIA - 9.7%
California Hsg. Fin. Agcy. Rev. (Home Mtg.)
Series 1983 A, 0% 2/1/15 A 312,000 40,560 130329QE
California Gen. Oblig. 4.75% 9/1/23 Aa 8,500,000 7,341,875 130627BZ
California Pub. Wrks. Board Lease Rev.
Rfdg. (Dept. Corrections St. Prisons) Series A,
5% 12/1/19, (AMBAC Insured) (c) Aaa 5,000,000 4,562,500 13068GPA
(California University Proj.) Series A:
5.50% 6/1/14 A1 3,000,000 2,895,000 13068GRB
5% 6/1/23 A1 2,800,000 2,453,500 13068GRD
Del Norte County Rev. Rfdg. (Department of
Corrections) 5.20% 12/1/09 A1 4,000,000 3,835,000 13068GSZ
Culver City Redev. Fing. Auth. Rev. Rfdg. Tax
Allocation:
5.50% 11/1/14 (AMBAC Insured) Aaa 2,000,000 1,995,000 230341BL
4.60% 11/1/20 (AMBAC Insured) Aaa 3,000,000 2,565,000 230341BM
Metropolitan Wtr. Dist. Southern California
Wtrwks. Rev. Rfdg. Series A, 5.75% 7/1/21 Aa 9,000,000 9,135,000
592663MS
Northern California Pwr. Agcy. Pub. Pwr. Rev.
Rfdg. (Geothermal Proj. #3) Series A, 5.85%
7/1/10 A 1,750,000 1,789,375 664843SB
Orange County Dev. Agcy. Tax Allocation
(Santa Ana Heights Proj.) 6% 9/1/15 Baa1 2,000,000 1,962,500 684246CA
Sacramento Fing. Auth. Lease Rev. Rfdg.
Series A, 5.40% 11/1/20, (AMBAC Insured) Aaa 10,000,000 9,687,500
785846BN
Sacramento Fing. Auth. Rev. Rfdg. Series B,
5.40% 11/1/20 Aa 12,000,000 11,295,000 785846BP
Sacramento Muni. Util. Dist. Elec. Rev. Rfdg.
Series G, 4.75% 9/1/21, (MBIA Insured) Aaa 6,350,000 5,524,500 7860044L
MUNICIPAL BONDS - CONTINUED
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
CALIFORNIA - CONTINUED
San Bernardino County Ctfs. Partn.
(Med Ctr. Fing. Proj.) 5.50% 8/1/17 Baa1 $ 4,000,000 $ 3,685,000 796815NL
San Joaquin County Ctfs. of Prtn. (Cap. Facs.
Proj.) 4.90% 11/15/08 (MBIA Insured) Aaa 4,000,000 3,780,000 798085EP
West & Central Basin Wtr. Rfdg. (West Basin Proj.):
7.42% 8/1/07 (AMBAC Insured) (g) Aaa 2,900,000 2,892,750 95122ECS
7.52% 8/1/08 (AMBAC Insured) (g) Aaa 3,050,000 3,042,375 95122ECX
78,482,435
COLORADO - 7.4%
Adams County Single Family Mtg. Rev. Rfdg.
Series A-2, 8.70% 6/1/12, (FSA Insured) Aaa 5,000,000 5,606,250
005706JS
Colorado Health Facs. Auth. Rev.:
(PSL Health Sys. Proj.):
Series A, 6.875% 2/15/23 Baa1 4,000,000 4,170,000 1964732D
Series B, 8.50% 2/15/21 Baa1 2,250,000 2,556,563 196473C5
(Rocky Mountain Adventist) 6.625% 2/1/13 Baa 6,000,000 6,187,500
1964732N
Denver City & County Arpt. Rev.:
Series A:
0% 11/15/05 (e) Baa1 4,615,000 2,232,506 249181GR
8.50% 11/15/23 (e) Baa1 11,330,000 12,902,038 249181GW
7.25% 11/15/25 Baa1 3,500,000 3,828,125 249181JS
Series 1991 A:
8.875% 11/15/12 (e) Baa1 2,000,000 2,357,500 249181HL
8.75% 11/15/23 (c) (e) Baa1 10,000,000 11,712,500 249181HR
Series D, 0% 11/15/05 (e) Baa1 5,000,000 2,418,750 249181JE
Denver City & County Ind. Dev. Rev. (Denver Univ.
Prog.) Series 1991, 7.50% 3/1/11 BBB 870,000 971,138 249188CZ
Jefferson County School Dist. #R-001, 6%
12/15/12, (AMBAC Insured) Aaa 5,000,000 5,262,500 472736XB
60,205,370
CONNECTICUT - 0.8%
Connecticut Unltd. Tax Rfdg. Series E, 6%
3/15/12 Aa 3,215,000 3,436,031 20772EDL
Connecticut Health & Ed. Facs. Auth. Rev.
(St. Raphael Hosp.) 5.30% 7/1/10,
(AMBAC Insured) Aaa 2,990,000 2,930,200 207742R2
6,366,231
DISTRICT OF COLUMBIA - 1.2%
District of Columbia Hosp. Rev. (Hosp. for
Sick Children) Series A, 8.875% 1/1/21 - 3,465,000 3,872,138 254764BS
MUNICIPAL BONDS - CONTINUED
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
DISTRICT OF COLUMBIA - CONTINUED
District of Columbia Rev. (Georgetown Univ.)
Series A, 7.40% 4/1/18 A1 $ 2,380,000 $ 2,656,675 254839BR
Metropolitan Washington Arpt. Auth. Gen. Arpt.
Rev. Series A, 7.25% 10/1/10,
(FGIC Insured) (e) Aaa 3,000,000 3,337,500 592650CH
9,866,313
FLORIDA - 1.3%
Florida Board Ed. Admin. Cap. Outlay:
(Pub. Ed.) Series A, 7.25% 6/1/23
(Pre-Refunded to 6/1/00 @ 102) (f) Aaa 3,315,000 3,845,400 341421RE
7.25% 6/1/23 Aa 3,185,000 3,579,144 341421RF
Jacksonville Health Facs. Auth. Hosp. Rev.
(Baptist Med. Ctr.) Series A, 7.30%, 6/1/19,
(MBIA Insured) Aaa 3,000,000 3,352,500 469404GJ
10,777,044
GEORGIA - 5.0%
Brunswick Wtr. & Swr. Rev. Rfdg. & Impt. 6.10%
10/1/19, (MBIA Insured) Aaa 1,500,000 1,580,625 117151FF
Cobb-Marrieta Coliseum & Exhibit Hall Auth.
Rev. Rfdg. 5.50%10/1/12, (MBIA Insured) Aaa 3,975,000 3,970,031
190760BA
Douglas County School Sys. Unltd. Tax 7.15%
1/1/10 (Pre-Refunded to 1/1/98 @ 102) (f) A 1 1,000,000 1,120,000
259032AN
Georgia Muni. Elec. Auth. Pwr. Rev. Rfdg.
Series Z, 5.50% 1/1/20 A1 10,000,000 9,750,000 373540X3
Georgia Residential Fin. Auth. Home Ownership
Mtg. Series 1984 B, 0% 12/1/15 (c) Aa 35,000,000 3,456,250 373588CP
Metro Atlanta Rapid Tran. Auth. Sales Tax Rev.
Rfdg. Series P, 6.25% 7/1/11,
(AMBAC Insured) (c) Aaa 10,000,000 10,800,000 591745QD
Muni. Elec. Auth. Spl. Oblig.:
Fourth Crossover Series Proj. #1,
6.50% 1/1/20 A1 5,750,000 6,346,563 625919CL
Fifth Crossover Series Proj. 1, 6.50% 1/1/17 A1 3,500,000 3,841,250
625919DB
40,864,719
HAWAII - 2.2%
Hawaii County Rfdg. & Impt. Series A, 5.55%
5/1/09, (FGIC Insured) Aaa 1,000,000 1,018,750 419722PZ
Hawaii Gen. Oblig.:
Rfdg. Series CI 4.75% 11/1/09 Aa 3,000,000 2,820,000 419779NU
Series CH, 6% 11/1/08 Aa 3,390,000 3,644,250 419779NT
Series CH, 6% 11/1/09 Aa 4,000,000 4,260,000 419779NV
Hawaii Arpts. Sys. Rev. 2nd Series, 7.50%
7/1/20, (FGIC Insured) (e) Aaa 1,500,000 1,702,500 419794LU
MUNICIPAL BONDS - CONTINUED
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
HAWAII - CONTINUED
Honolulu City & County Ref. & Impt. Series B,
5% 10/1/13 Aa $ 5,000,000 $ 4,756,250 438669PV
18,201,750
IDAHO - 1.5%
Idaho Falls Elec. Rfdg.:
0% 4/1/07, (FGIC Insured) Aaa 4,000,000 1,970,000 451182FD
0% 4/1/08, (FGIC Insured) Aaa 1,950,000 904,313 451182FE
Idaho Hsg. Agcy. Single Family Mtg.
Series 1991 B, 7.50% 7/1/24 AA 2,500,000 2,675,000 4512976F
Idaho Hsg. Agcy. Residential Mtg. Rev. Series
1984 A, 0% 7/1/15 Aa1 57,900,000 6,658,500 451297PV
12,207,813
ILLINOIS - 3.5%
Chicago Ill FGIC Rfdg. Series B, 5.125%
1/1/15 (AMBAC Insured) Aaa 2,250,000 2,123,438 1674833X
Chicago O'Hare Int'l. Arpt. Spl. Facs. Rev. (United
Airlines, Inc.):
8.25% 5/1/99 (e) Baa1 4,395,000 4,818,019 167590BT
Rfdg. Series A:
5% 1/1/12 A1 7,500,000 6,956,250 167592LP
5% 1/1/16 A1 2,825,000 2,546,031 167592LQ
Chicago Single Family Mtg. Rev. (Cap.
Appreciation) Series A, 0% 12/1/16,
(FGIC Insured) Aaa 55,025,000 6,465,438 167685EF
Chicago Residential Mtg. Rev. Rfdg. (Cap.
Appreciation) Series B, 0% 10/1/09,
(MBIA Insured) Aaa 9,000,000 3,150,000 16768RAB
DeKalb Single Family Mtg. Rev. 7.45% 12/1/09,
(GNMA Coll.) (e) Aaa 2,465,000 2,615,981 240818AR
28,675,157
INDIANA - 1.1%
Indiana Univ. Rev. (Bldg. #3 Student Fee) Series E,
7.375% 10/1/10, (MBIA insured) Aaa 4,000,000 4,510,000 455113BG
Indianapolis Arpt. Fac. Rev. Economic Dev. Rfdg.
(Federal Express Corp. Proj.) 6.85% 4/1/17 (b) Baa3 4,000,000 4,010,000
455256AB
8,520,000
KANSAS - 0.4%
Johnson County Wtr. Dist. #1 Wtr. Rev. Series A,
6.10% 12/1/16 Aa 2,215,000 2,303,600 478754VF
Reno County Mtg. Rev. Rfdg. (Single Family)
Series B, 8.70% 9/1/11 A1 1,125,000 1,224,844 759753BY
3,528,444
MUNICIPAL BONDS - CONTINUED
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
KENTUCKY - 1.8%
Kenton County Arpt. Board Arpt. Rev. (Spl. Facs.
Delta) Series A, 7.50% 2/1/20 (e) Ba1 $ 3,600,000 $ 3,816,000 491026JG
Kentucky Tpk. Auth. Econ. Dev. Rev. Rfdg.
(Revitalization Proj.) 5.50% 7/1/07,
(AMBAC Insured) Aaa 5,000,000 5,175,000 491552GK
Owensboro Elec. Lt. & Pwr. Rev. Series B:
Rfdg. 0% 1/1/03, (AMBAC Insured) Aaa 3,025,000 1,924,656 691021HV
Rfdg. 0% 1/1/06, (AMBAC Insured) Aaa 3,875,000 2,053,750 691021JB
0% 1/1/10, (AMBAC Insured) Aaa 4,000,000 1,635,000 691021GM
14,604,406
LOUISIANA - 0.3%
New Orleans Rfdg. (Cap. Appreciation) 0%
9/1/12, (AMBAC Insured) Aaa 6,250,000 2,164,063 647634XX
MARYLAND - 1.7%
Maryland Health & Higher Ed. Facs. Auth. Rev.:
Rfdg. (Doctors Commty. Hosp.) 5.75% 7/1/13 Baa 2,000,000 1,917,500
574216FQ
Proj. & Rfdg. (Doctors Commty. Hosp.) 5.50%
7/1/24 Baa 10,000,000 9,125,000 574216FR
Maryland Health & Higher Edl. Facs. Auth. Rev.
(Howard County Gen. Hosp.) 5.50% 7/1/13 Baa1 3,000,000 2,823,750
574216JM
13,866,250
MASSACHUSETTS - 2.4%
Massachusetts Bay Trans. Auth. Rfdg. (Gen.
Trans. Sys.) Series A, 5.50% 3/1/12 A 5,000,000 4,993,750 575566R9
Massachusetts Health & Edl. Facs. Auth. Rev.
(St. Anne's Hosp.) Series A, 9.375% 7/1/14 B1 1,000,000 1,027,500
575850MG
Massachusetts Hsg. Fin. Agcy. (Hsg. Projs.)
Series A, 6.375% 4/1/21 A1 5,000,000 5,168,750 575852VP
Massachusetts Ind. Fin. Agcy. 8.625%
10/1/23 - 1,945,000 1,930,413 575914ZU
Massachusetts Muni. Wholesale Elec. Co. Pwr.
Supply Sys. Rev.:
Series A, 6.75% 7/1/08 A 6,000,000 6,547,500 575765JJ
3.625% 7/1/17, (Pre-Refunded to
1/1/95 @ 100) (f) Baa1 5,000 5,413 575765KF
13.625% 7/1/17, (Pre-Refunded to
7/1/94 @ 100) (f) Baa1 5,000 5,169 575765KH
13.625% 7/1/17, (Pre-Refunded to
7/1/95 @ 100) (f) Baa1 5,000 5,650 575765KJ
19,684,145
MUNICIPAL BONDS - CONTINUED
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
MICHIGAN - 3.9%
Detroit Swr. Disp. Rev. 8.561% 7/1/23,
(FGIC Insured) (g) Aaa $ 3,000,000 $ 3,052,500 251237PH
Flint Hosp. Bldg. Auth. Rev. (Hurley Med. Ctr.)
7.80% 7/1/14 Baa1 2,000,000 2,170,000 339511CB
Michigan Pub. Pwr. Agcy. Rev. Rfdg.
(Belle River Proj.) Series B, 5% 1/1/19 A1 1,000,000 905,000 594570FD
Michigan Hosp. Fin. Auth. Rev. Rfdg.:
(Pontiac Osteopathic Hosp.):
Series A, 6% 2/1/14 Baa1 1,500,000 1,436,250 59465C4Q
6% 2/1/24 Baa1 4,500,000 4,246,875 59465C4R
(Sisters of Mercy Health Corp.) 5.375%
8/15/14 (MBIA Insured) Aaa 2,840,000 2,744,150 59465CX2
Michigan Hsg. Dev. Auth. Rental Hsg. Rev.
Series B, 5.70% 4/1/12 A+ 3,750,000 3,698,438 59465MER
Michigan Strategic Fund Ltd. Oblig. Rev.
(Mercy Svcs. for Aging Proj.) 9.40% 5/15/20 - 3,965,000 4,336,719
594692XT
Midland County Econ. Dev. Corp. Poll. Cont. Rev.
Rfdg. (Subordinated Ltd. Oblig.) Series B,
9.50% 7/23/09 (e) - 7,000,000 7,927,500 597901AD
Waterford Township Econ. Dev. Corp. Rev. Ltd.
Tax Oblig. (Canterbury Health Care) 8.375%
7/1/23 - 800,000 842,000 941458AU
31,359,432
MINNESOTA - 2.5%
Minneapolis & St. Paul Hsg. & Redev. Auth.
Healthcare Sys. Rev. (Healthspan Health Sys.
Corp.) (Health One Sys.) Series A, 4.75%
11/15/18 (AMBAC Insured) Aaa 5,000,000 4,400,000 603695DF
Southern Minnesota Muni. Pwr. Agcy. Pwr.
Supply Sys. Rev. Series A, 4.75% 1/1/16 A1 17,500,000 15,684,375
843375NK
20,084,375
MISSISSIPPI - 0.2%
Mississippi Hosp. Equip. & Facs. Auth. Rev.
(Rush Med. Foundation Proj.) Series A,
8.75% 1/1/16 Baa 1,500,000 1,711,875 605360BU
MISSOURI - 2.4%
Kansas City Ind. Dev. Auth. Health Facs. Rev.:
Rfdg. & Impt. (Menorah Med. Ctr. Proj.)
9.25% 6/1/16 - 6,000,000 6,442,500 484906AB
Rfdg. (Encore Nursing Ctr.) (Beverly Enterprises,
Inc.) 8% 12/1/02 - 3,175,000 3,488,531 48502PAA
MUNICIPAL BONDS - CONTINUED
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
MISSOURI - CONTINUED
Kirkwood Ind. Dev. Auth. Health Care Corp.
Rev. (St. Joseph Hosp.) 7% 7/1/22 (Pre-
Refunded to 7/1/2 @ 102) (f) Baa1 $ 2,645,000 $ 2,780,556 497606BR
Missouri Health & Edl. Facs. Auth. Health Facs.
Rev. (Still Reg'l. Med. Ctr. Proj.) 7.70%
2/1/13 Baa 2,000,000 2,177,500 6069004Q
St. Louis Regional Convention & Sports Complex
Auth. Series C:
7.75% 8/15/01 - 970,000 1,034,263 791687AA
7.90% 8/15/21 - 3,500,000 3,841,250 791687AB
19,764,600
MONTANA - 2.4%
Montana Board of Investment Payroll Tax
(Workers Compensation):
Series 1991, 6.875% 6/1/11, (MBIA Insured) Aaa 3,000,000 3,318,750
61213HDC
6.875% 6/1/20, (MBIA Insured) (c) Aaa 7,130,000 7,887,563 61213HDD
Montana Coal Severance Tax Rfdg.
(Broadwater Pwr. Proj.) Series A, 6.875%
12/1/11 (e) A1 3,050,000 3,282,563 612127FT
Montana Higher Ed. Student Loan Rev. 3.40%
12/1/94 (e) Aaa 5,390,000 5,390,000 612130CX
19,878,876
MULTI-STATE CTFS TRUST - 0.4%
Washington D.C. Metropolitan Area Trans.
Auth. 6% 7/1/08, (FGIC Insured) Aaa 3,235,000 3,457,406 938782BE
NEBRASKA - 0.7%
Omaha Pub. Pwr. Dist. Elec. Rev. Series C,
5.50% 2/1/14 Aa 5,650,000 5,579,375 681793C3
NEVADA - 1.1%
Clark County Ind. Dev. Rev.
(Southwest Gas Corp.) Series B, 7.50%
9/1/32 (e) Ba1 8,500,000 9,254,375 181004AP
NEW HAMPSHIRE - 0.2%
New Hampshire Ind. Dev. Auth. Rev.
(Poll. Cont.) (United Illuminating Co.)
Series B, 10.75% 10/1/12 (e) Baa3 1,130,000 1,363,063 644688EC
NEW JERSEY - 2.2%
New Jersey Econ. Dev. Auth. Econ. Dev. Rev.
Rfdg. (Holt Hauling & Warehouse) Series G,
8.40% 12/15/15 - 5,000,000 5,275,000 64577MLJ
New Jersey Tpk. Auth. Tpk. Rev. Rfdg. Series C,
6.50% 1/1/16 A 11,000,000 12,251,250 646139JP
17,526,250
MUNICIPAL BONDS - CONTINUED
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
NEW MEXICO - 1.1%
Farmington Poll. Cont. Rev. 6.40%
8/15/23 Ba2 $ 3,250,000 $ 3,250,000 311450CU
Farmington Util. Sys. Rev. Rfdg. 5.75%
5/15/13, (FGIC Insured) Aaa 1,750,000 1,754,375 311457CH
Hobbs Single Family Mtg. Rev. Rfdg. 8.75%
7/1/11 A 2,190,000 2,389,838 433863AX
New Mexico Univ. Rev. Rfdg. Series A,
6.25% 6/1/12 A1 1,560,000 1,702,350 914692TE
9,096,563
NEW YORK - 12.6%
Metropolitan Trans. Auth. Svc. Contract:
(Commuter Facs.) Series O, 5.75% 7/1/13 Baa1 1,000,000 987,500
592597C6
Series O, 5.75% 7/1/13 Baa1 2,000,000 1,975,000 592597C7
0% 7/1/09 Baa1 7,500,000 3,028,125 592597J7
New York State Dorm. Auth. Rev.:
(Suffolk County Judicial Facs.) Series A,
9.50% 4/15/14 Baa1 7,000,000 8,146,250 649832XV
Rfdg. (State Univ. Edl. Facs.) Series A:
5.50% 5/15/09 Baa1 4,000,000 3,915,000 649834AL
5.50% 5/15/13 Baa1 13,100,000 12,723,375 649834AQ
5.25%, 5/15/15 Baa1 10,000,000 9,337,500 649834AS
New York State Energy Research & Dev. Auth.
Elec. Facs. Rev. (Long Island Ltg.) Series B,
7.15% 2/1/22 Baa3 5,000,000 5,337,500 649841BP
New York State Local Govt. Assistance Corp.
Rdfg.:
Series C, 5% 4/1/21 A 12,000,000 10,740,000 649876JJ
Series C, 5.50% 4/1/17 A 15,000,000 14,587,500 649876JN
Series E, 5.25 4/1/16 A 4,075,000 3,835,594 649876KY
New York State Urban Dev. Corp. Rev.:
Rfdg. (Correctional Facs.) Series A,
5.50% 1/1/09 Baa1 3,500,000 3,390,625 650033E6
5/25% 1/1/21 Baa1 7,000,000 6,326,250 650033E9
New York Unltd. Tax Rfdg. Series D, 5.75%
8/15/10 Baa1 3,255,000 3,173,625 649655MQ
Triborough Bridge & Tunnel Auth. Rev.
(Gen. Purp.):
Rfdg. Series Y:
5.50% 1/1/17 Aa 3,500,000 3,469,375 896029YE
6% 1/1/12 Aa 3,000,000 3,150,000 896029YS
Series X, 6.625% 1/1/12 Aa 7,000,000 7,866,250 896029XJ
101,989,469
MUNICIPAL BONDS - CONTINUED
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
NORTH CAROLINA - 2.0%
North Carolina Muni. Pwr. Agcy. #1
Catawba Elec. Rev.:
Rfdg.:
6% 1/1/04 A $ 4,250,000 $ 4,526,250 658203QD
6% 11/1/09, (AMBAC Insured) Aaa 2,935,000 3,103,763 658203QP
6% 11/1/10, (MBIA Insured) Aaa 2,750,000 2,897,813 658203QQ
5.25% 1/1/09 A 6,155,000 5,916,494 658203RX
16,444,320
NORTH DAKOTA - 1.1%
Mercer County Poll. Cont. Rev. (Basin Elec. Pwr.)
Series E, 7% 1/1/19 A2 3,325,000 3,624,250 587850CX
Rfdg. (Antelope Valley Station) 7.20%
6/30/13, (AMBAC Insured) (b) Aaa 5,000,000 5,612,500 587850DA
9,236,750
OHIO - 0.9%
Bedford Hosp. Impt. Rev. Rfdg. (Bedford Commty.
Hosp.) Series 1990, 8.50% 5/15/09 - 1,055,000 1,155,225 076372AS
Hamilton County Swr. Sys. Rev. Rfdg. & Impt.
Metro. Swr. Dist. Series A, 5.45% 12/1/09,
(FGIC Insured) Aaa 2,250,000 2,269,688 407288FY
Ohio Hsg. Fin. Agcy. Mtg. Rev. (Oakleaf-Toledo
Apts. Proj.) 10.25% 12/20/25, (GNMA Coll.) AAA 1,595,000 1,842,225
676901LY
Ohio State Bldg. Auth. (Workers Comp.)
4.75% 4/1/14 A 2,500,000 2,259,375 6775536N
7,526,513
OKLAHOMA - 3.0%
Grand River Dam Auth. Rev. Rfdg.:
5.70% 6/1/05 A 2,000,000 2,102,500 386442PE
5.75% 6/1/06 A 5,150,000 5,407,500 386442PF
5.75% 6/1/08, (FSA Insured) Aaa 2,225,000 2,319,563 386442PH
5.50% 6/1/10 A 11,800,000 11,696,750 386442PK
Tulsa Muni. Arpt. Rev. (American Airlines Proj.)
7.375% 12/1/20 (e) Baa2 2,500,000 2,650,000 899661CL
24,176,313
OREGON - 0.5%
Port Morrow Poll. Ctr. Rev. (Pacific Northwest)
Series A, 8% 7/15/11 A+ 3,420,000 4,039,875 734739AF
PENNSYLVANIA - 4.6%
Clarion County Hosp. Auth. Hosp. Rev.
(Clarion Hosp. Proj.) 8.50% 7/1/21 BBB- 2,500,000 2,828,125 180901AP
MUNICIPAL BONDS - CONTINUED
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
PENNSYLVANIA - CONTINUED
Delaware County Auth. Rev. (First Mtg. Riddle
Village Proj.):
8% 6/1/99 - $ 3,875,000 $ 3,976,719 245913BE
9.25% 6/1/22 - 4,915,000 5,228,331 245913BF
Delaware County Ind. Dev. Auth. Poll. Cont. Rev.
(Philadelphia Elec. Co. Proj.) 7.375% 4/1/21 Baa1 2,000,000 2,190,000
246015AY
Montgomery County Ind. Dev. Auth. Rev. Rfdg.
(Poll. Cont.) (Philadelphia Elec. Co.) Series A,
7.60% 4/1/21 (e) Baa2 1,000,000 1,098,750 613609MC
Pennsylvania Intergovernmental Coop. Auth.
Spl. Tax Rev.:
(City of Philadelphia Funding Prog.)
5.75% 6/15/15 Baa 6,000,000 5,977,500 708840BN
Rfdg. Series A, 5% 6/15/15 Baa 3,000,000 2,763,750 708840CH
Philadelphia Gas Wks. Rev. Rfdg. Fourteenth
Series A:
5.50% 7/1/03 Baa1 2,000,000 2,020,000 717823MN
5.50% 7/1/03 Baa1 1,000,000 1,002,500 717823MR
Philadelphia Hosp. & Higher Ed. Facs. Auth.
Hosp. Rev. (Temple Univ. Hosp.) Series A,
6.50% 11/15/08 Baa1 2,000,000 2,152,500 717903RN
Philadelphia Wtr. & Wastewtr. Rev. 8.12%
6/15/12, (FGIC Insured) (g) Aaa 6,000,000 6,022,500 717893BF
Wilkins Area Ind. Dev. Auth. Rev. (1st Mtg.)
(Fairview Extended Care) Series A, 10.25%
1/1/21 (c) - 2,000,000 2,185,000 968422AA
37,445,675
PUERTO RICO - 0.2%
Puerto Rico Commonwealth Hwy. & Trans.
Auth. Hwy. Rev. Series W, 5.50% 7/1/15 Baa1 1,500,000 1,460,625
745181CB
SOUTH DAKOTA - 0.3%
South Dakota Health & Edl. Facs. Auth. Rev.
Rfdg. (Prairie Lakes Healthcare) 7.25% 4/1/22 Baa 2,000,000 2,152,500
837559E7
TENNESSEE - 0.8%
Metro Gov't. Nashville & Davidson County
Wtr. & Swr. Rev. Rfdg. 5.20% 1/1/13,
(FGIC Insured) Aaa 2,000,000 1,927,500 592098XF
Tennessee Hsg. Dev. Agcy. (Cap.
Appreciation Single Family Prog.)
Series 1984 B, 0% 7/1/17 A1 56,215,000 4,708,006 880458EM
6,635,506
MUNICIPAL BONDS - CONTINUED
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
TEXAS - 4.1%
Alliance Arpt. Auth. Spl. Facs. Rev.
(American Airlines, Inc. Proj.):
7.50% 12/1/29 (e) Baa1 $ 3,000,000 $ 3,191,250 01852LAA
7% 12/1/11 (e) Baa1 10,000,000 10,712,500 01852LAB
Austin Util. Sys. Rev. Rfdg.:
Series A, 0% 11/15/08, (MBIA Insured) Aaa 3,895,000 1,713,800 0524735L
(Cap. Appreciation) Series A, 0%
5/15/09, (MBIA Insured) Aaa 3,060,000 1,300,500 0524735M
East Texas Health Facs. Dev. Corp. Hosp. Rev.
(Palestine) 7.80% 8/15/18 - 3,000,000 3,007,500 275573AB
El Paso Prop. Fin. Auth. Single Family Mtg. Rev.
Series A, 8.70% 12/1/18, (GNMA Coll.) (e) Aaa 2,360,000 2,613,700
283813AB
Harris County Cultural & Ed. Facs. Fin. Corp.
(Space Ctr. Houston Proj.) 9.25% 8/15/15 - 3,515,000 3,989,525 414007AF
San Antonio Elec. & Gas Rev. Rfdg. Series B:
0% 2/1/08, (FGIC Insured) Aaa 2,000,000 920,000 7962528D
0% 2/1/09, (FGIC Insured) Aaa 2,000,000 860,000 7962528E
Texas Muni. Pwr. Agcy. Rev. Rfdg.
(Cap. Appreciation) 0% 9/1/13,
(MBIA Insured) Aaa 10,000,000 3,225,000 882555SM
Victoria Hsg. Fin. Corp. Single Family Mtg.
Rev. Rfdg. Series A, 8.50% 1/1/11 A 1,305,000 1,427,344 926320BB
Winters Wtrwks. & Swr. Sys. Rev. Rfdg.
8.50% 8/1/17 - 500,000 591,250 976188AX
33,552,369
UTAH - 1.0%
Intermountain Pwr. Agcy. Pwr. Supply
8.33% 7/1/21 (g) Aa 4,000,000 4,000,000 458840Y7
Utah Hsg. Fin. Agcy.:
(Residential Mtg.) Series 1983 A, 0% 7/1/16 A+ 10,735,060 1,140,600
917550JN
(Single Family Mtg.) Series G, 9.25%
7/1/19, (FHA Guaranteed) (e) AA 2,540,000 2,933,700 917550VF
8,074,300
VERMONT - 0.7%
Vermont Hsg. Fin. Agcy. Single Family Series 2:
7.30% 5/1/25 (e) A1 2,600,000 2,717,000 924195HF
7.30% 5/1/25 A1 650,000 671,125 924195LK
Vermont Ind. Dev. Auth. Ind. Dev. Rev.
(Radisson Hotel) Series B-1, 7.75%
11/15/15 - 2,350,000 2,455,750 924199DS
5,843,875
MUNICIPAL BONDS - CONTINUED
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
VIRGINIA - 0.5%
Virginia Hsg. Dev. Auth. Residential Mtg.
(Single Family Mtg.) Series 1983 B, 0%,
9/1/14 Aa $ 2,430,000 $ 312,863 928136FA
Virginia Resources Auth. Wtr. & Swr. Sys. Rev.
(Lot 3) 7.25% 10/1/11 (Pre-Refunded to
10/1/00 @ 102) (e) (f) AA 3,225,000 3,761,156 928180WY
4,074,019
WASHINGTON - 6.2%
Douglas County Pub. Util Dist. #1 Wells
Hydroelec. Rev. Rfdg. 8.75% 9/1/18 A 1,395,000 1,860,581 259561DS
Washington Pub. Pwr. Supply Sys. Nuclear Proj.
#1 Rev. Rfdg. Series A, 7.50% 7/1/15 Aa 11,295,000 12,763,350 939827SU
Washington Pub. Pwr. Supply Sys. Nuclear
Proj. #2:
Rfdg. Series B, 7% 7/1/12 Aa 3,700,000 4,102,375 939828LX
Series C, 0% 7/1/05, (MBIA Insured) Aaa 16,140,000 8,856,825
939828QU
7.77% 7/1/12 Aa 14,000,000 13,265,000 939828TV
Washington Pub. Pwr. Supply Sys. Nuclear
Proj. #3, 7.57% 7/1/12 (g) Aa 10,000,000 9,125,000 939830PR
49,973,131
WYOMING - 0.4%
Wyoming Commty. Dev. Auth. Single Family
Mtg. 7.15% 6/1/22 Aa 2,920,000 3,135,340 9832199A
TOTAL MUNICIPAL BONDS
(Cost $777,026,985) 793,275,248
MUNICIPAL NOTES (D) - 2.4%
CALIFORNIA - 0.4%
California Poll. Cont. Fing. Auth. Resources
Recovery Rev. (Ultra Pwr. Rocklin Proj.)
Series 1988 B, 2.35%, LOC Bank of
America Nat'l. Trust & Savings, VRDN (e) - 2,900,000 2,900,000
130535AN
MARYLAND - 0.4%
Baltimore County Econ. Dev. Rev. Rfdg.
(Blue Circle, Inc. Proj.) Series 1992,
2.50%, LOC Den Danske Bank Group, VRDN VMIG 1 2,500,000 2,500,000
059136AJ
Montgomery County Hsg. Opportunity
Commission Hsg. Rev. (Draper Lane Apts.)
2.65%, (FGIC Insured) BPA Sumitomo Bank
Ltd., VRDN (e) VMIG 1 900,000 900,000 613344JP
3,400,000
MUNICIPAL NOTES (D) - CONTINUED
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
NEW YORK - 0.8%
Amherst Ind. Dev. Auth. Ind. Dev. Rev.
(Maple Dev. Proj.) Series 1986, 2.80%,
LOC Marine Midland Bank, VRDN (e) - $ 2,430,000 $ 2,430,000 031366AQ
Chautauqua County Indl. Dev. Auth. Rev.
(Bush Industries, Inc. Proj.) Series 84,
3.15% LOC Marine Midland Bank, VRDN - 1,100,000 1,100,000 1625459T
New York City Hsg. Dev. Corp. Spl.
(Carnegie Park Proj.) Series 1984 A,
3.35% LOC Sumitomo Trust & Banking Ltd.,
VRDN VMIG 2,900,000 2,900,000 64970T9A
6,430,000
OHIO - 0.2%
Ohio Air Quality Dev. Auth. Dev. Rev.
(JMG Funding Ltd. Partnership) Series 1992 B,
2.40%, LOC Societe Generale, VRDN (e) A-1+ 1,800,000 1,800,000 677525KH
VIRGINIA - 0.6%
Richmond Ind. Dev. Auth. (Cogentrix Richmond,
Inc. Proj.) Series 1990 A, 2.35%, LOC
Banque Paribas, VRDN (e) - 3,400,000 3,400,000 765415KE
Southampton County Ind. Dev. Auth. Facs. Rev.
(Hadson Pwr. #11 - Southampton Proj.)
Series 1990-A, 2.30%,
LOC Cr. Suisse, VRDN (e) - 1,600,000 1,600,000 841022AA
5,000,000
TOTAL MUNICIPAL NOTES
(Cost $19,530,000) 19,530,000
TOTAL INVESTMENT IN SECURITIES - 100%
(Cost $796,556,985) $ 812,805,248
FUTURES CONTRACTS
EXPIRATION UNDERLYING FACE UNREALIZED
DATE AMOUNT AT VALUE GAIN/(LOSS)
SELL
170 U.S. Treasury Bond Contracts March 1994 $ 19,109,062 $ 80,797
85 U.S. Treasury Bond Contracts June 1994 9,464,219 (47,336)
$ 28,573,281 $ 33,461
THE VALUE OF FUTURES CONTRACTS SOLD AS A PERCENTAGE OF TOTAL INVESTMENT IN
SECURITIES - 3.5%
SECURITY TYPE ABBREVIATIONS
SAVRS - Select Auction Variable Rate
Securities
TRAN - Tax & Revenue Anticipation Notes
VRDN - Variable Rate Demand Notes
LEGEND
7. Standard & Poor's Corporation credit ratings are used in the absence
of a rating by Moody's Investors Service, Inc.
8. Security purchased on a delayed delivery basis (see Note 2 of Notes to
Financial Statements).
9. A portion of the securities was pledged to cover margin requirements for
futures contracts and delayed delivery purchases. At the period end, the
value of securities pledged amounted to $24,707,250.
10. The coupon rate shown on floating or adjustable rate securities
represents the rate at period end.
11. Private activity obligations whose interest is subject to the federal
alternative minimum tax for individuals (AMT securities).
12. Security collateralized by an amount sufficient to pay interest and
principal.
13. Inverse floating rate security is a security where the coupon is
inversely indexed to a floating interest rate. The price will be more
volatile than the price of a comparable fixed rate security.
OTHER INFORMATION
The composition of long-term debt holdings as a percentage of total value
of investment in securities, is as follows (ratings are unaudited):
MOODY'S RATINGS S&P RATINGS
Aaa, Aa, A 61.8% AAA, AA,A 63.3%
Baa 23.2% BBB 19.1%
Ba 2.0% BB 3.4%
B 0.1% B 0.1%
Caa 0.0% CCC 0.0%
Ca, C 0.0% CC, C 0.0%
D 0.0%
The percentage not rated by either S&P or Moody's amounted to 7.6%.
The distribution of municipal securities by revenue source, as a percentage
of total value of investment in securities, is as follows:
Electric Revenue 22.5%
Transportation 13.8
Health Care 11.8
Lease Revenue 11.5
Others (individually less than 10%) 40.4
TOTAL 100.0%
INCOME TAX INFORMATION
At February 28, 1994, the aggregate cost of investment securities for
income tax purposes was $796,576,076. Net unrealized appreciation
aggregated $16,229,172 of which $26,898,001 related to appreciated
investment securities and $10,668,829 related to depreciated investment
securities.
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
<S> <C> <C>
FEBRUARY 28, 1994 (UNAUDITED)
ASSETS
Investment in securities, at value (cost $796,556,985) $ 812,805,248
(Notes 1 and 2) - See accompanying schedule
Receivable for investments sold 11,977,337
Interest receivable 10,983,409
Redemption fees receivable (Note 1) 1,319
TOTAL ASSETS 835,767,313
LIABILITIES
Payable to custodian bank $ 243,092
Payable for investments purchased 10,205,112
Regular delivery
Delayed delivery (Note 2) 9,060,400
Payable for fund shares redeemed 2,842,468
Dividends payable 763,764
Accrued management fee 357,604
Payable for daily variation on futures contracts 196,563
TOTAL LIABILITIES 23,669,003
NET ASSETS $ 812,098,310
Net Assets consist of (Note 1):
Paid in capital $ 785,638,383
Accumulated undistributed net realized gain (loss) on 10,178,203
investments
Net unrealized appreciation (depreciation) on:
Investment securities 16,248,263
Futures contracts 33,461
NET ASSETS, for 76,285,340 shares outstanding $ 812,098,310
NET ASSET VALUE, offering price and redemption price per $10.65
share ($812,098,310 (divided by) 76,285,340 shares)
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
<S> <C> <C>
SIX MONTHS ENDED FEBRUARY 28, 1994 (UNAUDITED)
INTEREST INCOME $ 26,560,499
EXPENSES
Management fee (Note 4) $ 2,392,860
Non-interested trustees' compensation 2,832
TOTAL EXPENSES 2,395,692
NET INTEREST INCOME 24,164,807
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
(NOTES 1, 2 AND 3)
Net realized gain (loss) on:
Investment securities 22,222,712
Futures contracts (151,013) 22,071,699
Change in net unrealized appreciation (depreciation) on:
Investment securities (36,437,701)
Futures contracts 34,843 (36,402,858)
NET GAIN (LOSS) (14,331,159)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM $ 9,833,648
OPERATIONS
</TABLE>
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
<S> <C> <C>
SIX MONTHS YEAR ENDED
ENDED FEBRUARY AUGUST 31,
28, 1993
1994
(UNAUDITED)
INCREASE (DECREASE) IN NET ASSETS
Operations $ 24,164,807 $ 52,958,243
Net interest income
Net realized gain (loss) on investments 22,071,699 36,519,652
Change in net unrealized appreciation (depreciation) (36,402,858) 20,925,770
on
investments
NET INCREASE (DECREASE) IN NET ASSETS RESULTING 9,833,648 110,403,665
FROM OPERATIONS
Distributions to shareholders (24,164,807) (52,958,243)
From net interest income
From net realized gain (43,789,770) (5,730,111)
TOTAL DISTRIBUTIONS (67,954,577) (58,688,354)
Share transactions 83,038,823 268,787,536
Net proceeds from sales of shares
Reinvestment of distributions from: 18,639,323 42,345,828
Net interest income
Net realized gain 36,213,675 4,977,298
Cost of shares redeemed (180,457,937) (325,984,136)
Redemption fees (Note 1) 74,856 204,197
Net increase (decrease) in net assets resulting from (42,491,260) (9,669,277)
share transactions
TOTAL INCREASE (DECREASE) IN NET ASSETS (100,612,189) 42,046,034
NET ASSETS
Beginning of period 912,710,499 870,664,465
End of period $ 812,098,310 $ 912,710,499
OTHER INFORMATION
Shares
Sold 7,541,258 24,803,405
Issued in reinvestment of distributions from: 1,696,459 3,890,570
Net interest income
Net realized gain 3,282,683 467,786
Redeemed (16,477,116) (30,219,037)
Net increase (decrease) (3,956,716) (1,057,276)
</TABLE>
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
SIX MONTHS YEARS ENDED AUGUST 31, JUNE 4, 1990
ENDED (COMMENCEMENT
FEBRUARY 28, OF
1994 OPERATIONS) TO
AUGUST 31,
(UNAUDITED) 1993 1992 1991 1990
SELECTED PER-SHARE DATA
Net asset value, beginning $ 11.370 $ 10.710 $ 10.360 $ 9.890 $ 10.000
of period
Income from Investment .304 .663 .704 .739 .187
Operations
Net interest income
Net realized and (.171)# .727 .387 .463 (.120)
unrealized gain (loss)
on investments
Total from investment .133 1.390 1.091 1.202 .067
operations
Less Distributions (.304) (.663) (.704) (.739) (.187)
From net interest
income
From net realized gain (.550) (.070) (.040) - -
on
investments
Total distributions (.854) (.733) (.744) (.739) (.187)
Redemption fees added to .001 .003 .003 .007 .010
paid in capital
Net asset value, end of $ 10.650 $ 11.370 $ 10.710 $ 10.360 $ 9.890
period
TOTAL RETURN (dagger) (double dagger) 1.13% 13.55% 10.93 12.65 .76%
% %
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 812 $ 913 $ 871 $ 551 $ 93
(in millions)
Ratio of expenses to .55%* .47% .36 .23 -
average net assets % %
Ratio of expenses to .55%* .55% .55 .55 .55%*
average net assets % %
before expense
reductions
Ratio of net interest 5.55%* 6.09% 6.68 7.24 7.91%*
income to average net % %
assets
Portfolio turnover rate 59%* 50% 62 78 116%*
% %
</TABLE>
* ANNUALIZED
(dagger) TOTAL RETURNS DO NOT INCLUDE THE ACCOUNT CLOSEOUT FEE AND FOR
PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED.
(double dagger) THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN
EXPENSES NOT BEEN REDUCED DURING THE PERIODS SHOWN.
# THE AMOUNT SHOWN FOR A SHARE OUTSTANDING DOES NOT CORRESPOND WITH THE
AGGREGATE NET GAIN ON INVESTMENTS FOR THE PERIOD ENDED DUE TO THE TIMING OF
SALES AND REPURCHASES OF FUND SHARES IN RELATION TO FLUCTUATING MARKET
VALUES OF THE INVESTMENTS OF THE FUND.
NOTES TO FINANCIAL STATEMENTS
For the period ended February 28, 1994 (Unaudited)
1. SIGNIFICANT ACCOUNTING
POLICIES.
Spartan Municipal Income Portfolio (the fund) is a fund of Fidelity Union
Street Trust (the trust) and is authorized to issue an unlimited number of
shares. The trust is registered under the Investment Company Act of 1940,
as amended (the 1940 Act), as an open-end management investment company
organized as a Massachusetts business trust. The following summarizes the
significant accounting policies of the fund:
SECURITY VALUATION. Securities are valued based upon a computerized matrix
system and/or appraisals by a pricing service, both of which consider
market transactions and dealer-supplied valuations. Short-term securities
maturing within sixty days are valued either at amortized cost or original
cost plus accrued interest, both of which approximate current value.
Securities for which quotations are not readily available through the
pricing service are valued at their fair value as determined in good faith
under consistently applied procedures under the general supervision of the
Board of Trustees.
INCOME TAXES. As a qualified regulated investment company under Subchapter
M of the Internal Revenue Code, the fund is not subject to income taxes to
the extent that it distributes all of its taxable income for its fiscal
year. The schedule of investments includes information regarding income
taxes under the caption "Income Tax Information."
INTEREST INCOME. Interest income, which includes amortization of premium
and accretion of original issue discount, is accrued as earned.
EXPENSES. Most expenses of the trust can be directly attributed to a fund.
Expenses which cannot be directly attributed are apportioned between the
funds in the trust.
DISTRIBUTIONS TO SHAREHOLDERS. Distributions are declared daily and paid
monthly from net interest income. Distributions from realized gains, if
any, are recorded on the ex-dividend date.
Income and capital gain distributions are determined in accordance with
income tax regulations which may differ from generally accepted accounting
principles. These differences are primarily due to differing treatments for
futures and options transactions and losses deferred due to wash sales,
futures and options, and excise tax regulations. The fund also utilized
earnings and profits distributed to shareholders on redemption of shares as
a part of the dividends paid deduction for income tax purposes. Permanent
book and tax basis differences relating to shareholder distributions will
result in reclassifications to paid in capital.
REDEMPTION FEES. Shares held in the fund less than 180 days are subject to
a redemption fee equal to .50% of the proceeds of the redeemed shares. The
fee, which is retained by the fund, is accounted for as an addition to paid
in capital.
1. SIGNIFICANT ACCOUNTING
POLICIES - CONTINUED
SECURITY TRANSACTIONS. Security transactions are accounted for as of trade
date. Gains and losses on securities sold are determined on the basis of
identified cost.
CHANGE IN ACCOUNTING FOR DISTRIBUTIONS TO SHAREHOLDERS. Effective September
1, 1993, the fund adopted Statement of Position 93-2: Determination,
Disclosure, and Financial Statement Presentation of Income, Capital Gain,
and Return of Capital Distributions by Investment Companies. As a result,
the fund changed the classification of distributions to shareholders to
better disclose the differences between financial statement amounts and
distributions determined in accordance with income tax regulations.
Accordingly, amounts as of August 31, 1993 have been reclassified to
reflect an increase in paid in capital of $737,425 and a decrease in
accumulated net realized gain on investments of $737,425.
2. OPERATING POLICIES.
DELAYED DELIVERY TRANSACTIONS. The fund may purchase or sell securities on
a when-issued or forward commitment basis. Payment and delivery may take
place a month or more after the date of the transaction. The price of the
underlying securities and the date when the securities will be delivered
and paid for are fixed at the time the transaction is negotiated. The fund
identifies securities as segregated in its custodial records with a value
at least equal to the amount of the purchase commitment.
FUTURES CONTRACTS AND OPTIONS. The fund may invest in futures contracts and
write options. These investments involve, to varying degrees, elements of
market risk and risks in excess of the amount recognized in the Statement
of Assets and Liabilities. The face or contract amounts reflect the extent
of the involvement the fund has in the particular classes of instruments.
Risks may be caused by an imperfect correlation between movements in the
price of the instruments and the price of the underlying securities and
interest rates. Risks also may arise if there is an illiquid secondary
market for the instruments, or due to the inability of counterparties to
perform.
Futures contracts are valued at the settlement price established each day
by the board of trade or exchange on which they are traded. Options traded
on an exchange are valued using the last sale price or, in the absence of a
sale, the last offering price. Options traded over-the-counter are valued
using dealer-supplied valuations.
3. PURCHASES AND SALES OF
INVESTMENTS.
Purchases and sales of securities, other than short-term securities,
aggregated $246,887,602 and $325,255,479,
respectively.
The market value of futures contracts opened and closed amounted to
$370,705,185 and $345,953,407,
respectively.
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES.
MANAGEMENT FEE. As the fund's investment adviser, Fidelity Management &
Research Company (FMR) pays all expenses except the compensation of the
non-interested Trustees and certain exceptions such as interest, taxes,
brokerage commissions and extraordinary expenses. FMR receives a fee that
is computed daily at an annual rate of .55% of the fund's average net
assets.
FMR also bears the cost of providing shareholder services to the fund. For
the period, FMR or its affiliates collected certain transaction fees from
shareholders which aggregated $11,670.
INVESTMENT ADVISER
Fidelity Management & Research Company
Boston, MA
OFFICERS
Edward C. Johnson 3d, President
J. Gary Burkhead, Senior Vice President
Norman Lind, Vice President
Gary L. French, Treasurer
John H. Costello, Assistant Treasurer
Arthur S. Loring, Secretary
BOARD OF TRUSTEES
J. Gary Burkhead
Ralph F. Cox *
Phyllis Burke Davis *
Richard J. Flynn *
Edward C. Johnson 3d
E. Bradley Jones *
Donald J. Kirk *
Peter S. Lynch
Edward H. Malone *
Gerald C. McDonough *
Thomas R. Williams *
GENERAL DISTRIBUTOR
Fidelity Distributors Corporation
Boston, MA
TRANSFER AND SHAREHOLDER
SERVICING AGENT
Fidelity Service Co.
Boston, MA
CUSTODIAN
United Missouri Bank, N.A.
Kansas City, MO
Corporate Headquarters
82 Devonshire St., Boston, MA 02109
FIDELITY TAX-FREE BOND FUNDS
Aggressive Tax-Free
California Tax-Free High Yield
California Tax-Free Insured
High Yield Tax-Free
Insured Tax-Free
Limited Term Municipals
Massachusetts Tax-Free High Yield
Michigan Tax-Free High Yield
Minnesota Tax-Free
Municipal Bond
New York Tax-Free High Yield
New York Tax-Free Insured
Ohio Tax-Free High Yield
Spartan Aggressive Municipal
Spartan California Municipal High Yield
Spartan Connecticut Municipal High Yield
Spartan Florida Municipal Income
Spartan Intermediate Municipal
Spartan Maryland Municipal Income
Spartan Municipal Income
Spartan New Jersey Municipal High Yield
Spartan New York Municipal High Yield
Spartan Pennsylvania Municipal High Yield
Spartan Short-Intermediate Municipal
THE FIDELITY TELEPHONE CONNECTION
MUTUAL FUND 24-HOUR SERVICE
Account Balances 1-800-544-7544
Exchanges/Redemptions 1-800-544-7777
Mutual Fund Quotes 1-800-544-8544
Account Assistance 1-800-544-6666
Product Information 1-800-544-8888
Retirement Accounts 1-800-544-4774
(8 a.m. - 9 p.m.)
TDD Service 1-800-544-0118
for the deaf and hearing impaired
(9 a.m. - 9 p.m. Eastern time)
* INDEPENDENT TRUSTEES
AUTOMATED LINES FOR QUICKEST SERVICE
(2_FIDELITY_LOGOS)SPARTAN(Registered trademark)
INTERMEDIATE MUNICIPAL
FUND
SEMIANNUAL REPORT
FEBRUARY 28, 1994
CONTENTS
PRESIDENT'S MESSAGE 3 Ned Johnson on minimizing taxes.
PERFORMANCE 4 How the fund has done over time.
FUND TALK 7 The manager's review of fund
performance, strategy, and outlook.
INVESTMENT CHANGES 10 A summary of major shifts in the
fund's investments over the last six
months.
INVESTMENTS 11 A complete list of the fund's
investments.
FINANCIAL STATEMENTS 17 Statements of assets and liabilities,
operations, and changes in net
assets, as well as financial
highlights.
NOTES 21 Footnotes to the financial
statements.
THIS REPORT AND THE FINANCIAL STATEMENTS CONTAINED HEREIN ARE SUBMITTED FOR
THE GENERAL
INFORMATION OF THE SHAREHOLDERS OF THE FUND. THIS REPORT IS NOT AUTHORIZED
FOR
DISTRIBUTION TO PROSPECTIVE INVESTORS IN THE FUND UNLESS PRECEDED OR
ACCOMPANIED BY
AN EFFECTIVE PROSPECTUS. NEITHER THE FUND NOR FIDELITY DISTRIBUTORS
CORPORATION IS A
BANK, AND FUND SHARES ARE NOT BACKED OR GUARANTEED BY ANY BANK OR INSURED
BY THE
FDIC.
PRESIDENT'S MESSAGE
DEAR SHAREHOLDER:
No one wants to pay more taxes than they have to. But a recent survey of
500 U.S. households, conducted by Fidelity and Yankelovich Partners, showed
that few people took steps to reduce their taxes under the new tax laws
that went into effect last year. In fact, many people were not completely
aware of the changes until they filed their 1993 tax returns.
Whether or not you're someone whose tax bill increased as a result of these
changes, it may make sense to consider ways to keep more of what you earn.
First, if your employer offers a 401(k) or 403(b) retirement savings plan,
consider enrolling. These plans are set up so you can make regular
contributions -
before taxes - to a retirement savings plan. They offer a disciplined
savings strategy, the ability to accumulate earnings tax-deferred, and
immediate tax savings. For example, if you earn $40,000 a year and
contribute 7% of your salary to your 401(k) plan, your annual contribution
is $2,800. That reduces your taxable income to $37,200 and, if you're in
the
28% tax bracket, saves you $784 in federal taxes. In addition, you pay no
taxes on any earnings until withdrawal.
It may be a good idea to contact your benefits office as soon as possible
to find out when you can enroll or increase your contribution. Most
employers allow employees to make changes only a few times each year.
Second, consider an IRA. Many people are eligible to make an IRA
contribution (up to $2,000) that is fully tax deductible. That includes
people who are not covered by company pension plans, or those within
certain income brackets. Even if you don't qualify for a fully deductible
contribution, any IRA earnings will grow tax-deferred until withdrawal.
Third, consider tax-free investments like municipal bonds and municipal
bond funds. Often these can provide higher after-tax yields than comparable
taxable investments. For example, if you're in the new 36% federal income
tax bracket and invest $10,000 in a taxable investment yielding 7%, you'll
pay $252 in federal taxes and receive $448 in income. That same $10,000
invested in a tax-free bond fund yielding 5.5% would allow you to keep $550
in income.
These are three investment strategies that could help lower your tax bill
in 1994. If you're interested in learning more, please call us at
1-800-544-8888 or visit a Fidelity Investor Center. We look forward to
talking with you.
Best regards,
Edward C. Johnson 3d, Chairman
PERFORMANCE: THE BOTTOM LINE
There are several ways to evaluate a fund's historical performance. You can
look at the total percentage change in value, the average annual percentage
change, or the growth of a hypothetical $10,000 investment. Each figure
includes changes in a fund's share price, reinvestment of any dividends (or
income) and capital gains (the profits the fund earns when it sells bonds
that have grown in value), and the effect of the $5 account closeout fee.
You can also look at the fund's income.
CUMULATIVE TOTAL RETURNS
PERIODS ENDED FEBRUARY 28, 1994 PAST 6 LIFE OF
MONTHS FUND
Spartan Aggressive Municipal 2.12% 7.88%
Lehman Brothers Municipal Bond Index 1.05% n/a
Average High Yield Municipal Bond Fund 1.60% n/a
Consumer Price Index 1.31% 1.88%
CUMULATIVE TOTAL RETURNS show the fund's performance in percentage terms
over a set period - in this case, six months or since the fund started on
April 29, 1993. For example, if you invested $1,000 in a fund that had a 5%
return over the past year, you would end up with $1,050. You can compare
these figures to the performance of the Lehman Brothers Municipal Bond
index - a broad gauge of the municipal bond market. To measure how the fund
stacked up against its peers, you can look at the average high yield
municipal bond fund, which reflects the performance of 34 similar funds
tracked by Lipper Analytical Services. Both benchmarks include reinvested
dividends and capital gains, if any. Comparing the fund's performance to
the consumer price index helps show how your fund did compared to
inflation. (The periods covered by the CPI numbers are the closest
available match to those covered by the fund.)
AVERAGE ANNUAL TOTAL RETURNS
AVERAGE ANNUAL TOTAL RETURNS take the fund's actual (or cumulative) return
and show you what would have happened if the fund had performed at a
constant rate each year. In the fund's next report we'll report these
numbers for the fund and the benchmarks.
$10,000 OVER LIFE OF FUND
Spartan Aggr Muni LB Municipal Bond
04/30/93 10000.00 10000.00
05/31/93 10111.64 10056.00
06/30/93 10292.53 10223.94
07/31/93 10315.65 10237.23
08/31/93 10551.38 10450.16
09/30/93 10724.42 10569.29
10/31/93 10748.10 10589.37
11/30/93 10656.40 10496.19
12/31/93 10896.03 10717.66
01/31/94 11021.66 10839.84
02/28/94 10776.71 10559.09
$10,000 OVER LIFE OF FUND: Let's say you invested $10,000 in Spartan
Aggressive Municipal Fund on April 30, 1993, shortly after the fund
started. As the chart shows, by February 28, 1994, the value of your
investment with dividends reinvested would have grown to $10,777 - a 7.77%
increase on your initial investment. This assumes you still owned the fund
on February 28, 1994 and therefore does not include the effect of the $5
account closeout fee. For comparison, look at how the Lehman Brothers
Municipal Bond Index did over the same period. With dividends reinvested,
the same $10,000 would have grown to $10,559 - a 5.59% increase.
UNDERSTANDING
PERFORMANCE
How a fund did yesterday is
no guarantee of how it will do
tomorrow. Bond prices, for
example, move in the
opposite direction of interest
rates. In turn, the share price,
return, and yield of a fund
that invests in bonds will vary.
That means if you sell your
shares during a market
downturn, you might lose
money. But if you can ride out
the market's ups and downs,
you may have a gain.
(checkmark)
INCOME
APRIL 29, 1993
SIX MONTHS (COMMENCEM
ENDED ENT OF
FEBRUARY 28, OPERATIONS) TO
1994 AUGUST 31,
1993
Income return 2.91% 2.14%
Capital gain return 0.19% 0.00%
Change in share price -0.98% 3.49%
Total return 2.12% 5.63%
INCOME returns, capital gain returns, and changes in share price are all
part of a bond fund's total return. An income return reflects the dividends
paid by the fund. A capital gain return reflects the amount paid by the
fund to shareholders based on the profits it has from selling bonds that
have grown in value. Both returns assume the dividends or gains are
reinvested. Changes in the fund's share price include changes in the prices
of the bonds owned by the fund. Change in share price and total return
figures include the effect of the $5 account closeout fee.
DIVIDENDS AND YIELD
PERIODS ENDED FEBRUARY 28, 1994 PAST 30 PAST 6 LIFE OF
DAYS MONTHS FUND
Dividends per share n/a 30.18(cents) 51.08(cents)
Annualized dividend rate n/a 5.84% 9.99%
Annualized yield 5.87% n/a n/a
Tax-equivalent yield 9.17% n/a n/a
DIVIDENDS per share show the income paid by the fund for a set period. If
you annualize this number, based on an average share price of $10.43 over
the past six months and $10.31 over the life of fund, you can compare the
fund's income over these two periods. The 30-day annualized YIELD is a
standard formula for all funds based on the yields of the bonds in the
fund, averaged over the past 30 days. This figure shows you the yield
characteristics of the fund's investments at the end of the period. It also
helps you compare funds from different companies on an equal basis. The
tax-equivalent yield shows what you would have to earn on a taxable
investment to equal the fund's tax-free yield, if you're in the 36% tax
bracket.
FUND TALK: THE MANAGER'S OVERVIEW
An interview with Anne Punzak, Portfolio Manager of Spartan Aggressive
Municipal Fund
Q. ANNE, HOW DID THE FUND DO?
A. For the six months ended February 28, 1994, the fund had a cumulative
total return of 2.12%. That beat the average high-yield municipal bond
fund's return of 1.60% for the same period, according to Lipper Analytical
Services.
Q. WHAT MADE THE DIFFERENCE?
A. A couple factors. First, for most of the period, having a
longer-than-average duration - about 7.9 years - worked in the fund's
favor. Duration is a measure of interest rate sensitivity. That means as
interest rates dropped, the prices of bonds in the fund rose more than if
the duration had been shorter. I kept the fund's duration long because I
expected slow economic growth and low inflation, which tend to keep
interest rates down. That's what happened for most of the period, until
February when the Federal Reserve raised interest rates. Once that
happened, the fund suffered a bit from having a longer duration. While I
don't think that interest rates will go much higher from here, I've started
to shorten the duration to help insulate the fund from market volatility.
Q. WHAT WAS THE SECOND FACTOR?
A. Many of the fund's health-care bonds did well. One example is the
Denver-based hospital group Health One. The group was created when two of
Denver's leading hospitals, PSL and Swedish Medical, merged. As a result of
the merger, the new entity was able to cut costs by eliminating redundant
services. What's more, the group has strong HMO relationships, which should
help the hospital survive, and even benefit, from health-care reform.
Q. WHAT WERE THE DISAPPOINTMENTS?
A. The fund's 10.1% stake in California bonds didn't do as well as I
thought it would. A heavy supply of these bonds was issued, which somewhat
depressed prices. But I'm still optimistic about California because of some
recent signs of improvement in the state's economy. Retail sales have
picked up, and the unemployment rate appears to have hit bottom. I also
believe that over the short term the recent Los Angeles earthquake will be
a positive factor for the state's economy. After the San Francisco
earthquake, the state's economy got a boost from increased building
activity. I expect the same to occur this time around, too.
Q. WHERE ELSE HAVE YOU FOCUSED?
A. The fund's largest state concentration - at 10.2% of total investments -
is New York. Most of these bonds are state-appropriated, meaning they rely
on annual appropriations by the state legislature to meet all or part of
principal and interest payments. As the New York economy showed signs of
improvements, state-appropriated issues attracted more buyers, which pushed
up prices. On the fiscal front, the state is showing signs of improvement
and is expected to post a budget surplus for the second consecutive year.
What's more, these bonds could be upgraded in the next 12 months or so,
which should further help prices.
Q. YOU HAVE A FAIRLY LARGE STAKE - ABOUT 21% OF THE FUND'S INVESTMENTS - IN
NON-RATED BONDS. DO THESE BONDS CARRY MORE RISK THAN RATED BONDS?
A. Not necessarily. Just because the rating agencies haven't assigned a
rating doesn't mean they're low-rated or that there's more risk of their
not being able to meet their interest and principal payments. For example,
the issuer of a bond might be part of a sector or industry group that the
rating agencies don't follow. The issuer might have a substantial amount of
rated debt outstanding in the taxable market, and may not consider it
necessary to get a rating when coming to market with a small amount of
tax-exempt debt. Whatever the case, Fidelity's research staff closely
monitors these non-rated issues. Of the non-rated bonds in the fund at the
end of February, about one-fourth were considered to be investment grade or
better by Fidelity's analysts. The balance was below investment grade, but
were judged by our research team to have the potential for improved credit
quality. Bonds - both rated and non-rated - that are below investment-grade
quality are attractive because they offer both the potential for price
appreciation and relatively high yields. Of course there's no guarantee
their prices will appreciate more or their yields will be higher than
investment grade bonds.
Q. HOW DO YOU THINK HIGH-YIELD BONDS WILL DO IF INTEREST RATES RISE?
A. When interest rates rise, bond prices tend to drop. But a bond's total
return is based on the change in its price - up or down - and the income it
generates. Since high-yield bonds offer potentially high income, they
probably won't be as negatively affected as bonds that pay lower yields.
What's more, a period of higher interest rates would most likely mean the
economy was speeding up. Improvements in the economy tend to improve the
credit quality of high yield bonds, which could be positive for their
prices. At any rate, despite the recent volatility in the bond market, I
don't see interest rates rising much.
Q. SO HOW DO YOU EXPLAIN THE MARKET'S RECENT REACTION?
A. I think that's there's some confusion about what the Federal Reserve's
moves to raise rates meant. To me, it meant that it intends to be quite
vigilant in keeping inflation down. But by mid-summer, I think that things
will calm down a bit, and the market will stabilize, trading in a more
narrow range than it has over the past year.
Q. WHAT DOES THAT MEAN FOR
INVESTORS?
A. In my view, the bond market could be bumpy for the next few months, as
investors try to make sense out of conflicting economic indicators and
Federal Reserve policy. But once the market settles down, I think interest
rates won't rise or fall dramatically. What that probably means for
investors is more modest returns than we saw in 1993. Even so, I'm
optimistic that municipal bonds will continue to offer attractive returns
as new taxes cause demand to increase, while supply starts to dwindle.
Municipal bond issuance in 1994 is expected to be about half the 1993
level. Increased demand and decreased supply could be positive for
municipal bond prices.
FUND FACTS
GOAL: to provide current
income exempt from federal
income tax by investing
primarily in medium and
lower-quality
securities
START DATE: April 29, 1993
SIZE: as of February 28, 1994,
over $42 million
MANAGER: Anne Punzak, since
April 1993; manager, Fidelity
High Yield Tax-Free Portfolio,
since October 1993; Spartan
Florida Municipal Income
Portfolio, since March 1992;
Fidelity Insured Tax-Free
Portfolio, October 1989 to
September 1993
(checkmark)
ANNE PUNZAK'S INTEREST RATE
OUTLOOK:
"Even though the economy is
much healthier than it was a
year ago, inflation - which
when rising can also cause
interest rates to rise -
appears to be in check.
What's more, the Federal
Reserve has indicated that it
wants to remain vigilant in
keeping inflation low. If we do
have a low growth and low
inflation environment, that
would most likely be positive
for bonds."
(bullet) The fund's stake in
industrial revenue bonds was
cut to 17.3% on February 28,
from 22.2% six months ago.
That was due in part to a
pared back stake in airline
bonds, which were sold once
they'd reached relatively high
levels.
(bullet) On February 28, electric
revenue bonds were the
fund's third largest sector
concentration at 12.2%. They
are attractive because they
offer high yields. What's
more, they could become
scarce once most of the
refinancings to replace older,
more expensive debt, take
place. There is little need for
new electric plants in the
future, so there probably
won't be a lot of new electric
utility bonds issued. Those
factors will most likely
translate into scarcity, which
could help push prices up.
INVESTMENT CHANGES
TOP FIVE STATES AS OF FEBRUARY 28, 1994
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
6 MONTHS AGO
New York 10.2 8.7
California 10.1 13.1
Colorado 9.7 11.9
Kentucky 8.5 2.2
Michigan 7.7 6.6
TOP FIVE SECTORS AS OF FEBRUARY 28, 1994
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
6 MONTHS AGO
Health Care 28.6 24.9
Industrial Development 17.3 22.2
Electric Revenue 12.2 11.5
Lease Revenue 10.1 12.6
Education 9.3 1.2
AVERAGE YEARS TO MATURITY AS OF FEBRUARY 28, 1994
6 MONTHS AGO
Years 20.1 22.5
AVERAGE YEARS TO MATURITY SHOWS THE AVERAGE TIME UNTIL THE PRINCIPAL OF THE
BONDS IN THE FUND IS EXPECTED TO BE REPAID, WEIGHTED BY DOLLAR AMOUNT.
DURATION AS OF FEBRUARY 28, 1994
6 MONTHS AGO
Years 7.9 7.9
DURATION SHOWS HOW MUCH A BOND'S PRICE FLUCTUATES WITH CHANGES IN INTEREST
RATES. IF RATES RISE 1%, FOR EXAMPLE, THE SHARE PRICE OF A FUND WITH A
FIVE-YEAR DURATION WILL FALL 5%.
QUALITY DIVERSIFICATION AS OF FEBRUARY 28, 1994
(MOODY'S RATINGS)
Aaa 6.4%
Aa, A 19.1%
Baa 34.6%
Ba or B 18.5%
Non-rated 21.4%
Row: 1, Col: 1, Value: 21.4
Row: 1, Col: 2, Value: 18.5
Row: 1, Col: 3, Value: 34.6
Row: 1, Col: 4, Value: 19.1
Row: 1, Col: 5, Value: 6.4
THIS CHART EXCLUDES SHORT-TERM INVESTMENTS. WHERE MOODY'S RATINGS ARE NOT
AVAILABLE, WE HAVE USED S&P RATINGS.
INVESTMENTS FEBRUARY 28, 1994 (UNAUDITED)
Showing Percentage of Total Value of Investment in Securities
MUNICIPAL BONDS - 93.4%
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
ALABAMA - 2.0%
Cortland Ind. Dev. Board Solid Waste Disp. Rev.
(Champion Int'l. Corp. Proj.) Series A,
6.375% 3/1/29 Baa $ 1185,000 $ 188,459 222734AF
Cullman Med. Ctr. (Cullman Reg'l. Med. Ctr.)
Series A, 6.50% 2/15/23 Baa 425,000 426,594 230043AM
Cullman Med. Park South Med. Clinic Board
Rev. (Cullman Reg'l. Med. Ctr.) Series A,
6.50% 2/15/13 Baa 250,000 251,875 230043AL
866,928
ARKANSAS - 1.3%
Fayetteville Pub. Facs. Board. Rev. Rfdg.
(Butterfield Trail Village Proj.) Series A,
8.25% 9/1/00 - 550,000 561,688 312670AH
CALIFORNIA - 10.1%
California Statewide Commty. Dev. Corp. Rev.
Ctfs. of Partn. (Sisters of Charity Leavenworth)
5% 12/1/23 Aa 500,000 440,000 130909PR
Del Norte County Pub. Wks. Rev. Rfdg.
(Dept. of Corrections) 5.125%, 12/1/08 A1 750,000 719,063 13068GSY
Los Angeles Bldg. Auth. Lease Rev. Rfdg.
(California St. Dept. Gen. Svcs.) Series A,
5.625% 5/1/11 A1 1,000,000 990,000 544632BR
Los Angeles Dept. Wtr & Pwr. Plant Rev.
4.75% 8/15/16 Aa 1,000,000 885,000 544508JM
San Bernardino County Ctfs. Partn.
(Med Ctr. Fing. Proj.) 5.50% 8/1/17 Baa1 1,000,000 921,250 796815NL
Upland Ctfs. Partn. (San Antonio Commty. Hosp.)
5.25% 1/1/08 A 500,000 476,875 915346DN
4,432,188
COLORADO - 9.7%
Colorado Health Facs. Auth. Rev.:
(Hosp. - Swedish Med. Ctr. Proj.) Series A,
6.80% 1/1/23 Baa1 500,000 519,375 196473N3
(PSL Health Sys. Proj.) Series A,
6.875% 2/15/23 Baa1 1,850,000 1,928,625 1964732D
(Rocky Mountain Adventist) 6.625% 2/1/22 Baa 500,000 511,250 1964732M
Colorado Springs Arpt. Rev. (Cap. Appreciation)
Series C, 0% 1/1/06 BBB 250,000 118,125 196612BH
Denver City & County Arpt. Rev.:
Series A:
8.50% 11/15/23 (c) Baa1 250,000 284,688 249181GW
8% 11/15/25 (c) Baa1 150,000 166,500 249181GX
8% 11/15/25 (c) Baa1 175,000 193,813 249181HM
Series C, 6.75% 11/15/22 (c) Baa1 500,000 518,750 249181KS
4,241,126
MUNICIPAL BONDS - CONTINUED
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
CONNECTICUT - 2.6%
Connecticut Health & Ed. Facs. Auth. Rev.
(Quinnipiac Coll.) Series D, 6%, 7/1/13 BBB- $ 1,000,000 $ 997,500
207742F3
Eastern Connecticut Res. Recovery Auth. Solid
Waste Rev. (Wheelabrator Lisbon Proj.)
Series A, 5.50% 1/1/20 A 165,000 151,800 276318AN
1,149,300
GEORGIA - 0.4%
Savannah Hosp. Auth. Rev. Rfdg. & Impt.
(Candler Hosp.) 7% 1/1/11 Baa 150,000 157,125 804833CB
ILLINOIS - 1.0%
Chicago O'Hare Int'l. Arpt. Spl. Facs. Rev.
(American Airlines, Inc. Proj.) Series A,
7.875% 11/1/25 (c) Baa2 400,000 435,000 167590BR
INDIANA - 4.7%
Fishers Econ. Dev. Rev. (1st Mtg. United
Student Funds, Inc.) 8.375% 9/1/14 - 1,500,000 1,593,750 338035BK
Indianapolis Arpt. Auth. Spl. Facs. Rev.
(USAIR, Inc. Proj.) 7.50% 7/1/19 Ba3 450,000 468,000 455254CB
2,061,750
KANSAS - 1.2%
Olathe Ind. Rev. (Med. Ctr. Office Bldg. Proj.)
9% 10/1/01 - 500,000 516,250 679400KH
KENTUCKY - 8.5%
Kenton County Arpt. Board Arpt. Rev.
(Spl. Facs. Delta) Series A:
7.50% 2/1/20 (c) Ba1 1,085,000 1,150,100 491026JG
7.125% 2/1/21 (c) Ba1 500,000 516,250 491026JK
Owensboro Hosp. Rev. (Children's Psychiatric
Hosp. Western Proj.) 13% 11/1/10 - 930,000 950,925 691025AA
Winchester Ind. Bldg. Rev. Rfdg. (Kroger Co.)
7.75% 7/1/12 Ba3 1,000,000 1,103,750 972856DZ
3,721,025
LOUISIANA - 3.2%
New Orleans Gen. Oblig. Ltd. Tax Rfdg.
0% 9/1/15, (AMBAC Insured) Aaa 1,300,000 378,625 647634YA
Port New Orleans Ind. Dev. Rev. Rfdg.
(Continental Grain Co. Proj.) 7.50% 7/1/13 BB- 1,000,000 1,040,000
734786AP
1,418,625
MARYLAND - 1.1%
Queen Anne's County Econ. Dev. Rev.
(Safeway Stores Proj.) 7.75% 12/15/09 BB- 470,000 474,113 748235AA
MUNICIPAL BONDS - CONTINUED
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
MASSACHUSETTS - 2.0%
Massachusetts Ind. Fin. Agcy. 8.625% 10/1/23 - $ 300,000 $ 297,750
575914ZU
Massachusetts Muni. Wholesale Elec. Co. Pwr.
Supply Sys. Rev.:
Series D, 6.125% 7/1/19 A 350,000 355,688 575765LZ
(Inflos) Series A, 8.02% 7/1/18 (d) Aaa 250,000 238,438 575765MV
891,876
MICHIGAN - 7.7%
Detroit Gen. Oblig. 6.35% 4/1/14 Ba1 500,000 506,250 251093KD
Michigan Hosp. Fin. Auth. Rev. Rfdg.:
(Detroit Macomb Hosp. Corp.) Series A,
7.40% 6/1/13 B 150,000 152,250
(McLaren Obligated Group) Series A,
4.50% 10/15/21 A 350,000 283,063 59465CT7
59465CCV (Pontiac Osteopathic Hosp.) 6% 2/1/24 Baa1 1,000,000 943,750
59465C4R
(Saratoga Commty. Hosp.) 8.75% 6/1/10 - 500,000 548,125 59465CB6
Three Rivers Area Hosp. Rev. Series A:
10.80% 11/1/04 - 180,000 191,475 885667AT
10.90% 11/1/05 - 215,000 228,975 885667AU
11% 11/1/06 - 235,000 250,569 885667AV
11% 11/1/07 - 265,000 282,556 885667AW
3,387,013
MISSOURI - 1.1%
Kansas City Ind. Dev. Auth. (Kingswood United
Methodist Manor Proj.) Series 1993,
9% 11/15/13 - 500,000 496,875 48503PAA
NEVADA - 2.9%
Clark County Ind. Dev. Rev. (Southwest Gas Corp.):
Series B, 7.50% 9/1/32 Ba1 250,000 272,188 181004AP
Series A, 6.50% 12/1/33 Ba1 500,000 497,500 181004AS
Las Vegas Redev. Agcy. Tax Increment Rev.
(Sub. Lien Fremont St. Proj. A)
6.10% 6/15/14 BBB+ 500,000 486,250 517706BC
1,255,938
NEW MEXICO - 2.2%
Albuquerque Retirement Facs. Rev. Rfdg.
(La Vida Liena Proj.) Series A, 8.85% 2/1/23 - 200,000 200,000 013636AR
Farmington Poll. Cont. Rev. (Pub. Svc. Co. of
New Mexico San Juan Proj.) Series A,
6% 3/1/08 Ba2 800,000 787,000 311450AJ
987,000
MUNICIPAL BONDS - CONTINUED
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
NEW YORK - 10.2%
New York City Series B, 5.60% 8/15/06 Baa1 $ 350,000 $ 343,875 649653MN
New York City Rfdg.Series D:
5.70% 8/15/06 Baa1 500,000 495,625 649653MT
5.75% 8/15/07 Baa1 480,000 475,800 649654PF
New York City Series E:
5.70% 8/1/08 Baa1 500,000 490,625 649654PN
5.70% 8/1/09 Baa1 220,000 213,675 649655MR
New York State Dorm. Auth. Rev. Rfdg.:
(State Univ. Edl. Facs.) Series A:
5.50% 5/15/13 Baa1 250,000 242,813 649834AQ
5.25% 5/15/15 Baa1 650,000 606,938 649834AS
(Univ. Ed. Facs.) Series B, 5.25% 5/15/19 Baa1 350,000 323,750
649834NK
New York State Local Govt. Assistance
Corp. Rfdg. Series C, 5.50% 4/1/17 A 850,000 826,625 649876JN
New York State Urban Dev. Corp. Rev.
5/25% 1/1/21 Baa1 500,000 451,875 650033E9
4,471,601
NORTH CAROLINA - 1.7%
North Carolina Eastern Muni. Pwr. Agcy. Pwr.
Sys. Rev. Rfdg. Series C, 5% 1/1/21 A 845,000 744,656 658196TH
OKLAHOMA - 1.2%
Tulsa Muni. Arpt. Rev. (American Airlines Proj.)
7.375% 12/1/20 (c) Baa2 500,000 530,000 899661CL
PENNSYLVANIA - 6.0%
Chartiers Valley Ind. & Commercial Dev. Auth. 1st
Mtg. Rev. Rfdg. (United Methodist Health Ctr.)
Series 1988 A, 9.50% 12/1/15 - 150,000 159,563 161385BS
Delaware County Auth. Rev. (First Mtg.
Riddle Village Proj.) 8% 6/1/99 - 350,000 359,188 245913BE
Montgomery County Higher Ed. & Health Auth.
Hosp. Rev. (United Hosp., Inc.):
Series A, 8.375% 11/1/03 Ba1 135,000 146,644 613604JP
Series B, 7.50% 11/1/15 Ba1 165,000 170,363 613604KQ
Pennsylvania Intergovernmental Coop. Auth.
Spl. Tax Rev. Rfdg. Series A, 5% 6/15/15 Baa 600,000 552,750 708840CH
Philadelphia Hosp. & Higher Ed. Facs. Auth.
Rev. (Graduate Health System) Series A,
6.25% 7/1/13 Baa1 250,000 247,813 717825CN
Philadelphia Muni. Auth. Rev. Rfdg. Lease
Series D 6.125% 7/15/08 Ba 270,000 270,000 717904FY
MUNICIPAL BONDS - CONTINUED
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
PENNSYLVANIA - CONTINUED
Warren County Ind. Dev. Auth. Specialized
Dev. Rev. Rfdg. (Beverly Enterprises, Inc.):
8.75% 11/1/06 - $ 125,000 $ 143,438 935186BB
9%, 11/1/12 - 500,000 581,875 935186BC
2,631,634
TEXAS - 7.4%
Alliance Arpt. Auth. Spl. Facs. Rev. (American
Airlines, Inc. Proj.) 7.50% 12/1/29 Baa1 50,000 53,188 01852LAA
East Texas Health Facs. Dev. Corp. Hosp. Rev.
(Palestine) 7.80% 8/15/18 - 850,000 852,125 275573AB
El Paso Prop. Fin. Auth. Single Family Mtg. Rev.
Series A, 8.70% 12/1/18, (GNMA Coll.) (c) Aaa 1,380,000 1,528,350
283813AB
Harris County Cultural & Ed. Facs. Fin. Corp.
(Space Ctr. Houston Proj.) 9.25% 8/15/15 - 500,000 567,500 414007AF
Sam Rayburn Muni. Pwr. Agcy. Pwr. Supply
Sys. Rev. Rfdg. Series B, 5.50% 10/1/20 Baa 100,000 82,250 795869DM
Texas Nat'l. Research Lab Commission Fing.
Corp. Lease Rev. (Superconducting
Supercollider Proj.) 6.95% 12/1/12 A 150,000 153,000 882585AN
3,236,413
WASHINGTON - 5.2%
Washington Pub. Pwr. Supply Sys. Nuclear Proj. #2
Rev.:
Rfdg. Series A, 0% 7/1/11(MBIA Insured) Aaa 1,350,000 491,063
939828PS
8.14% 7/1/10, (FGIC Insured) (d) Aa 1,350,000 1,304,438 939828RS
7.77% 7/1/12 (d) Aa 500,000 473,750 939828TV
2,269,251
TOTAL MUNICIPAL BONDS
(Cost $41,299,780) 40,937,375
MUNICIPAL NOTES (B) - 6.6%
KANSAS - 3.4%
Olathe Edl. Facs. Rev. (College Assoc. Pooled
Ed. Loan Prog.) Series 1989 A, 2.55%,
LOC Marine Midland Bank, VRDN VMIG 1,500,000 1,500,000 679389AA
MUNICIPAL NOTES (B) - CONTINUED
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
MARYLAND - 3.2%
Montgomery County Hsg. Opportunity
Commission Hsg. Rev. (Draper Lane Apts.)
2.65%, (FGIC Insured) BPA Sumitomo Bank Ltd.,
VRDN (c) VMIG 1 $ 1,400,000 $ 1,400,000 613344JP
TOTAL MUNICIPAL NOTES
(Cost $2,900,000) 2,900,000
TOTAL INVESTMENT IN SECURITIES - 100%
(Cost $44,199,780) $ 43,837,375
SECURITY TYPE ABBREVIATIONS
VRDN - Variable Rate Demand Notes
LEGEND
1. Standard & Poor's Corporation credit ratings are used in the absence
of a rating by Moody's Investors Service, Inc.
2. The coupon rate shown on floating or adjustable rate securities
represents the rate at period end.
3. Private activity obligations whose interest is subject to the federal
alternative minimum tax for individuals (AMT securities).
4. Inverse floating rate security is a security where the coupon is
inversely indexed to a floating interest rate. The price will be more
volatile than the price of a comparable fixed rate security.
OTHER INFORMATION
The composition of long-term debt holdings as a percentage of total value
of investment in securities, is as follows (ratings are unaudited):
MOODY'S RATINGS S&P RATINGS
Aaa, Aa, A 22.4% AAA, AA, A 25.8%
Baa 28.7% BBB 25.3%
Ba 13.4% BB 11.9%
B 0.0% B 0.4%
Caa 0.0% CCC 0.0%
Ca, C 0.0% CC, C 0.0%
D 0.0%
The percentage not rated by either S&P or Moody's amounted to 20.0% .
The distribution of municipal securities by revenue source, as a percentage
of total value of investment in securities, is as follows:
Health Care 28.6%
Industrial Development 17.3
Electric Revenue 12.2
Lease Revenue 10.1
Others (individually less than 10%) 31.8
TOTAL 100.0%
INCOME TAX INFORMATION
At February 28, 1994, the aggregate cost of investment securities for
income tax purposes was $44,199,780. Net unrealized depreciation aggregated
$362,405, of which $161,683 related to appreciated investment securities
and $524,088 related to depreciated investment securities.
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
<S> <C> <C>
FEBRUARY 28, 1994 (UNAUDITED)
ASSETS
Investment in securities, at value (cost $44,199,780) $ 43,837,375
(Notes 1 and 2) - See accompanying schedule
Interest receivable 645,467
Redemption fees receivable (Note 1) 1,125
TOTAL ASSETS 44,483,967
LIABILITIES
Payable to custodian bank $ 543,715
Payable for investments purchased 951,826
Payable for fund shares redeemed 206,526
Dividends payable 50,354
Accrued management fee 19,773
TOTAL LIABILITIES 1,772,194
NET ASSETS $ 42,711,773
Net Assets consist of (Note 1):
Paid in capital $ 43,094,282
Accumulated undistributed net realized gain (loss) on (20,104)
investments
Net unrealized appreciation (depreciation) on investment (362,405)
securities
NET ASSETS, for 4,165,102 shares outstanding $ 42,711,773
NET ASSET VALUE, offering price and redemption price per $10.25
share ($42,711,773 (divided by) 4,165,102 shares)
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
<S> <C> <C>
SIX MONTHS ENDED FEBRUARY 28, 1994 (UNAUDITED)
INTEREST INCOME $ 1,032,331
EXPENSES
Management fee (Note 3) $ 95,704
Non-interested trustees' compensation 79
TOTAL EXPENSES 95,783
NET INTEREST INCOME 936,548
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS 14,760
(NOTES 1 AND 2)
Net realized gain (loss) on investment securities
Change in net unrealized appreciation (depreciation) on (609,190)
investment securities
NET GAIN (LOSS) (594,430)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM $ 342,118
OPERATIONS
</TABLE>
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
<S> <C> <C>
SIX MONTHS APRIL 29, 1993
ENDED FEBRUARY (COMMENCEMENT
28, OF
1994 OPERATIONS) TO
(UNAUDITED) AUGUST 31,
1993
INCREASE (DECREASE) IN NET ASSETS
Operations $ 936,548 $ 135,887
Net interest income
Net realized gain (loss) on investments 14,760 26,999
Change in net unrealized appreciation (depreciation) (609,190) 246,785
on
investments
NET INCREASE (DECREASE) IN NET ASSETS RESULTING 342,118 409,671
FROM
OPERATIONS
Distributions to shareholders (936,548) (135,887)
From net interest income
From net realized gain (57,070) -
TOTAL DISTRIBUTIONS (993,618) (135,887)
Share transactions 32,934,441 19,532,611
Net proceeds from sales of shares
Reinvestment of distributions from: 680,059 110,836
Net interest income
Net realized gain 45,561 -
Cost of shares redeemed (7,607,145) (2,652,686)
Redemption fees (Note 1) 43,045 2,767
Net increase (decrease) in net assets resulting from 26,095,961 16,993,528
share
transactions
TOTAL INCREASE (DECREASE) IN NET ASSETS 25,444,461 17,267,312
NET ASSETS
Beginning of period 17,267,312 -
End of period $ 42,711,773 $ 17,267,312
OTHER INFORMATION
Shares
Sold 3,159,479 1,915,939
Issued in reinvestment of distributions from: 65,383 10,820
Net interest income
Net realized gain 4,357 -
Redeemed (731,666) (259,210)
Net increase (decrease) 2,497,553 1,667,549
</TABLE>
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
<S> <C> <C>
SIX MONTHS APRIL 29, 1993
ENDED FEBRUARY (COMMENCEMENT
28, OF
1994 OPERATIONS) TO
AUGUST 31,
(UNAUDITED) 1993
SELECTED PER-SHARE DATA
Net asset value, beginning of period $ 10.350 $ 10.000
Income from Investment Operations .302 .209
Net interest income
Net realized and unrealized gain (loss) on (.094) .346
investments
Total from investment operations .208 .555
Less Distributions (.302) (.209)
From net interest income
From net realized gain on investments (.020) -
Total distributions (.322) (.209)
Redemption fees added to paid in capital .014 .004
Net asset value, end of period $ 10.250 $ 10.350
TOTAL RETURN (dagger) 2.14% 5.64%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (000 omitted) $ 42,712 $ 17,267
Ratio of expenses to average net assets .60%* .60%*
Ratio of net interest income to average net assets 5.87%* 6.24%*
Portfolio turnover rate 28%* 53%*
</TABLE>
* ANNUALIZED
(dagger) TOTAL RETURNS DO NOT INCLUDE THE ACCOUNT CLOSEOUT FEE AND FOR
PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED.
NOTES TO FINANCIAL STATEMENTS
For the period ended February 28, 1994 (Unaudited)
1. SIGNIFICANT ACCOUNTING
POLICIES.
Spartan Aggressive Municipal Fund (the fund) is a fund of Fidelity Union
Street Trust (the trust) and is authorized to issue an unlimited number of
shares. The trust is registered under the Investment Company Act of 1940,
as amended (the 1940 Act), as an open-end management investment company
organized as a Massachusetts business trust. The following summarizes the
significant accounting policies of the fund:
SECURITY VALUATION. Securities are valued based upon a computerized matrix
system and/or appraisals by a pricing service, both of which consider
market transactions and dealer-supplied valuations. Short-term securities
maturing within sixty days are valued either at amortized cost or original
cost plus accrued interest, both of which approximate current value.
Securities for which quotations are not readily available through the
pricing service are valued at their fair value as determined in good faith
under consistently applied procedures under the general supervision of the
Board of Trustees.
INCOME TAXES. The fund intends to qualify as a regulated investment company
under Subchapter M of the Internal Revenue Code. By so qualifying, the fund
will not be subject to income taxes to the extent that it distributes all
of its taxable income for its fiscal year. The schedule of investments
includes information regarding income taxes under the caption "Income Tax
Information."
INTEREST INCOME. Interest income, which includes amortization of premium
and accretion of original issue discount, is accrued as earned.
EXPENSES. Most expenses of the trust can be directly attributed to a fund.
Expenses which cannot be directly attributed are apportioned between the
funds in the trust.
DISTRIBUTIONS TO SHAREHOLDERS. Distributions are declared daily and paid
monthly from net interest income. Distributions from realized gains, if
any, are recorded on the ex-dividend date.
Income and capital gain distributions are determined in accordance with
income tax regulations which may differ from generally accepted accounting
principles. These differences are primarily due to differing treatments
from wash sales. The fund also utilized earnings and profits distributed
to shareholders on redemption of shares as a part of the dividends paid
deduction for income tax purposes. Permanent book and tax basis differences
relating to shareholder distributions will result in reclassifications to
paid in capital.
REDEMPTION FEES. Shares held in the fund less than 180 days are subject to
a redemption fee equal to 1% of the proceeds of the redeemed shares. The
fee, which is retained by the fund, is accounted for as an addition to paid
in capital.
1. SIGNIFICANT ACCOUNTING
POLICIES - CONTINUED
SECURITY TRANSACTIONS. Security transactions are accounted for as of trade
date. Gains and losses on securities sold are determined on the basis of
identified cost.
2. PURCHASES AND SALES OF
INVESTMENTS.
Purchases and sales of securities, other than short-term securities,
aggregated $28,883,262 and $3,934,048, respectively.
3. FEES AND OTHER TRANSACTIONS WITH AFFILIATES.
MANAGEMENT FEE. As the fund's investment adviser, Fidelity Management &
Research Company (FMR) pays all expenses except the compensation of the
non-interested Trustees and certain exceptions such as interest, taxes,
brokerage commissions and extraordinary expenses. FMR receives a fee that
is computed daily at an annual rate of .60% of the fund's average net
assets.
FMR also bears the cost of providing shareholder services to the fund. For
the period, FMR or its affiliates collected certain transaction fees from
shareholders which aggregated $355.
TO CALL FIDELITY
FOR FUND INFORMATION AND QUOTES
The Fidelity Telephone Connection offers you special automated telephone
services for quotes and balances. The services are easy to use,
confidential and quick. All you need is a Touch Tone telephone.
YOUR PERSONAL IDENTIFICATION NUMBER
(PIN)
The first time you call one of our automated telephone services, we'll ask
you
to set up your Personal Identification
Number (PIN). The PIN assures that
only you have automated telephone
access to your account information.
Please have your Customer Number
(T-account #) handy when you call --
you'll need it to establish your PIN. If
you would ever like to change your PIN, just choose the "Change your
Personal
Identification Number" option when
you call. If you forget your PIN, please
call a Fidelity representative at 1-800-
544-6666 for assistance.
(PHONE_GRAPHIC)(PHONE_GRAPHIC)(PHONE_GRAPHIC)(PHONE_GRAPHIC)(PHONE_GRAPHIC
(PHONE_GRAPHIC)MUTUAL FUND QUOTES*
1-800-544-8544
Just make a selection from this record-ed menu:
PRESS
1. For quotes on funds you own.
2. For an individual fund quote.
3. For the ten most frequently
requested Fidelity fund quotes.
4. For quotes on Fidelity Select
Portfolios(Registered trademark).
5. To change your Personal
Identification Number (PIN).
6. To speak with a Fidelity
representative.
(PHONE_GRAPHIC)(PHONE_GRAPHIC)(PHONE_GRAPHIC)(PHONE_GRAPHIC)(PHONE_GRAPHIC
(PHONE_GRAPHIC)MUTUAL FUND ACCOUNT
BALANCES 1-800-544-7544
Just make a selection from this record-
ed menu:
PRESS
1. For balances on funds you own.
2. For your most recent fund activity
(purchases, redemptions, and
dividends).
3. To change your Personal
Identification Number (PIN).
4. To speak with a Fidelity
representative.
* WHEN YOU CALL THE QUOTES LINE, PLEASE REMEMBER THAT A FUND'S YIELD AND
RETURN WILL
VARY AND, EXCEPT FOR MONEY MARKET FUNDS, SHARE PRICE WILL ALSO VARY. THIS
MEANS THAT
YOU MAY HAVE A GAIN OR LOSS WHEN YOU SELL YOUR SHARES. THERE IS NO
ASSURANCE THAT
MONEY MARKET FUNDS WILL BE ABLE TO MAINTAIN A STABLE $1 SHARE PRICE; AN
INVESTMENT IN
A MONEY MARKET FUND IS NOT INSURED OR GUARANTEED BY THE U.S. GOVERNMENT.
TOTAL
RETURNS ARE HISTORICAL AND INCLUDE CHANGES IN SHARE PRICE, REINVESTMENT OF
DIVIDENDS
AND CAPITAL GAINS, AND THE EFFECTS OF ANY SALES CHARGES. FOR MORE
INFORMATION ON ANY
FIDELITY FUND INCLUDING MANAGEMENT FEES AND CHARGES, CALL 1-800-544-8888
FOR A FREE
PROSPECTUS. READ IT CAREFULLY BEFORE YOU INVEST OR SEND MONEY.
INVESTMENT ADVISER
Fidelity Management & Research Company
Boston, MA
OFFICERS
Edward C. Johnson 3d, President
J. Gary Burkhead, Senior Vice President
Gary L. French, Treasurer
John H. Costello, Assistant Treasurer
Arthur S. Loring, Secretary
BOARD OF TRUSTEES
J. Gary Burkhead
Ralph F. Cox *
Phyllis Burke Davis *
Richard J. Flynn *
Edward C. Johnson 3d
E. Bradley Jones *
Donald J. Kirk *
Peter S. Lynch
Edward H. Malone *
Gerald C. McDonough *
Thomas R. Williams *
GENERAL DISTRIBUTOR
Fidelity Distributors Corporation
Boston, MA
TRANSFER AND SHAREHOLDER
SERVICING AGENT
Fidelity Service Co.
Boston, MA
CUSTODIAN
United Missouri Bank, N.A.
Kansas City, MO
Corporate Headquarters
82 Devonshire St., Boston, MA 02109
* INDEPENDENT TRUSTEES
AUTOMATED LINES FOR QUICKEST SERVICE
FIDELITY TAX-FREE BOND FUNDS
Aggressive Tax-Free
California Tax-Free High Yield
California Tax-Free Insured
High Yield Tax-Free
Insured Tax-Free
Limited Term Municipals
Massachusetts Tax-Free High Yield
Michigan Tax-Free High Yield
Minnesota Tax-Free
Municipal Bond
New York Tax-Free High Yield
New York Tax-Free Insured
Ohio Tax-Free High Yield
Spartan Aggressive Municipal
Spartan California Intermediate Municipal
Spartan California Municipal High Yield
Spartan Connecticut Municipal High Yield
Spartan Florida Municipal Income
Spartan Intermediate Municipal
Spartan Maryland Municipal Income
Spartan Municipal Income
Spartan New Jersey Municipal High Yield
Spartan New York Intermediate Municipal
Spartan New York Municipal High Yield
Spartan Pennsylvania Municipal High Yield
Spartan Short-Intermediate Municipal
THE FIDELITY TELEPHONE CONNECTION
MUTUAL FUND 24-HOUR SERVICE
Account Balances 1-800-544-7544
Exchanges/Redemptions 1-800-544-7777
Mutual Fund Quotes 1-800-544-8544
Account Assistance 1-800-544-6666
Product Information 1-800-544-8888
Retirement Accounts 1-800-544-4774
(8 a.m. - 9 p.m.)
TDD Service 1-800-544-0118
for the deaf and hearing impaired
(9 a.m. - 9 p.m. Eastern time)
(2_FIDELITY_LOGOS)SPARTAN(Registered trademark)
INTERMEDIATE MUNICIPAL
FUND
SEMIANNUAL REPORT
FEBRUARY 28, 1994
CONTENTS
PRESIDENT'S MESSAGE 3 Ned Johnson on minimizing taxes.
PERFORMANCE 4 How the fund has done over time.
FUND TALK 7 The manager's review of fund
performance, strategy, and outlook.
INVESTMENT CHANGES 10 A summary of major shifts in the
fund's investments over the last six
months.
INVESTMENTS 11 A complete list of the fund's
investments with their market value.
FINANCIAL STATEMENTS 26 Statements of assets and liabilities,
operations, and changes in net
assets, as well as financial
highlights.
NOTES 30 Footnotes to the financial
statements.
THIS REPORT AND THE FINANCIAL STATEMENTS CONTAINED HEREIN ARE SUBMITTED FOR
THE GENERAL
INFORMATION OF THE SHAREHOLDERS OF THE FUND. THIS REPORT IS NOT AUTHORIZED
FOR
DISTRIBUTION TO PROSPECTIVE INVESTORS IN THE FUND UNLESS PRECEDED OR
ACCOMPANIED BY
AN EFFECTIVE PROSPECTUS. NEITHER THE FUND NOR FIDELITY DISTRIBUTORS
CORPORATION IS A
BANK, AND FUND SHARES ARE NOT BACKED OR GUARANTEED BY ANY BANK OR INSURED
BY THE
FDIC.
PRESIDENT'S MESSAGE
DEAR SHAREHOLDER:
No one wants to pay more taxes than they have to. But a recent survey of
500 U.S. households, conducted by Fidelity and Yankelovich Partners, showed
that few people took steps to reduce their taxes under the new tax laws
that went into effect last year. In fact, many people were not completely
aware of the changes until they filed their 1993 tax returns.
Whether or not you're someone whose tax bill increased as a result of these
changes, it may make sense to consider ways to keep more of what you earn.
First, if your employer offers a 401(k) or 403(b) retirement savings plan,
consider enrolling. These plans are set up so you can make regular
contributions -
before taxes - to a retirement savings plan. They offer a disciplined
savings strategy, the ability to accumulate earnings tax-deferred, and
immediate tax savings. For example, if you earn $40,000 a year and
contribute 7% of your salary to your 401(k) plan, your annual contribution
is $2,800. That reduces your taxable income to $37,200 and, if you're in
the
28% tax bracket, saves you $784 in federal taxes. In addition, you pay no
taxes on any earnings until withdrawal.
It may be a good idea to contact your benefits office as soon as possible
to find out when you can enroll or increase your contribution. Most
employers allow employees to make changes only a few times each year.
Second, consider an IRA. Many people are eligible to make an IRA
contribution (up to $2,000) that is fully tax deductible. That includes
people who are not covered by company pension plans, or those within
certain income brackets. Even if you don't qualify for a fully deductible
contribution, any IRA earnings will grow tax-deferred until withdrawal.
Third, consider tax-free investments like municipal bonds and municipal
bond funds. Often these can provide higher after-tax yields than comparable
taxable investments. For example, if you're in the new 36% federal income
tax bracket and invest $10,000 in a taxable investment yielding 7%, you'll
pay $252 in federal taxes and receive $448 in income. That same $10,000
invested in a tax-free bond fund yielding 5.5% would allow you to keep $550
in income.
These are three investment strategies that could help lower your tax bill
in 1994. If you're interested in learning more, please call us at
1-800-544-8888 or visit a Fidelity Investor Center. We look forward to
talking with you.
Best regards,
Edward C. Johnson 3d, Chairman
PERFORMANCE: THE BOTTOM LINE
There are several ways to evaluate a fund's historical performance. You can
look at the total percentage change in value, the average annual percentage
change, or the growth of a hypothetical $10,000 investment. Each figure
includes changes in a fund's share price, reinvestment of any dividends (or
income) and capital gains (the profits the fund earns when it sells bonds
that have grown in value), and the effect of the $5 account closeout fee.
You can also look at the fund's income. If Fidelity had not reimbursed
certain fund expenses, the fund's returns would have been lower.
CUMULATIVE TOTAL RETURNS
PERIODS ENDED FEBRUARY 28, 1994 PAST 6 PAST 1 PAST 5 LIFE OF
MONTHS YEAR YEARS FUND
Spartan Short-Intermediate Municipal 1.39% 3.82% 39.20% 45.68%
Lehman Brothers Municipal Bond 1.05% 5.54% 59.02% n/a
Index
Average Short Municipal Bond Fund 1.24% 3.31% 37.22% n/a
Consumer Price Index 1.31% 2.52% 20.64% 32.76%
CUMULATIVE TOTAL RETURNS show the fund's performance in percentage terms
over a set period - in this case, six months, one year, five years or since
the fund started on December 24, 1986. For example, if you invested $1,000
in a fund that had a 5% return over the past year, you would end up with
$1,050. You can compare these figures to the performance of the Lehman
Brothers Municipal Bond Index - a broad measure of the municipal bond
market. To measure how the fund stacked up against its peers, you can look
at the average short municipal bond fund, which reflects the performance of
37 similar municipal bond funds tracked by Lipper Analytical Services. Both
benchmarks include reinvested dividends and capital gains, if any.
Comparing the fund's performance to the consumer price index helps show how
your fund did compared to inflation. (The CPI returns begin on the month
end following the fund's start.)
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED FEBRUARY 28, 1994 PAST 1 PAST 5 LIFE OF
YEAR YEARS FUND
Spartan Short-Intermediate Municipal 3.82% 6.84% 5.37%
Lehman Brothers Municipal Bond Index 5.54% 9.72% n/a
Average Short Municipal Bond Fund 3.31% 4.52% n/a
Consumer Price Index 2.52% 3.82% 4.03%
AVERAGE ANNUAL TOTAL RETURNS take the fund's actual (or cumulative) return
and show you what would have happened
if the fund had performed at a constant rate each year.
$10,000 OVER LIFE OF FUND
$10,000 OVER LIFE OF FUND: Let's say you invested $10,000 in Spartan
Short-Intermediate Municipal Fund on December 31, 1986, shortly after the
fund started. As the chart shows, by February 28, 1994, the value of your
investment would have grown to $14,675 - a 46.75% increase on your initial
investment. This assumes you still own the fund on February 28, 1994, and
therefore does not include the effect of the $5 account closeout fee. For
comparison, look at how the Lehman Brothers Municipal Bond Index - which
includes longer term bonds - did over the same period. With dividends
reinvested, the same $10,000 would have grown to $17,941 - a 79.41%
increase.
UNDERSTANDING
PERFORMANCE
How a fund did yesterday is
no guarantee of how it will do
tomorrow. Bond prices, for
example, move in the
opposite direction of interest
rates. In turn, the share price,
return, and yield of a fund
that invests in bonds will vary.
That means if you sell your
shares during a market
downturn, you might lose
money. But if you can ride out
the market's ups and downs,
you may have a gain.
(checkmark)
INCOME
SIX MONTHS YEARS ENDED AUGUST 31,
ENDED
FEBRUARY 28,
1994
1993 1992 1991 1990 1989
Income return 2.19% 4.83% 5.47% 6.30% 5.96% 5.96%
Capital gain returns 0.10% 0.00% 0.00% 0.00% 0.00% 0.00%
Change in share price -0.90% 2.53% 2.07% 2.00% -0.01% -0.22%
Total return 1.39% 7.36% 7.54% 8.30% 5.95% 5.74%
INCOME returns, capital gain returns, and changes in share price are all
part of a bond fund's total return. An income return reflects the dividends
paid by the fund. A capital gain return reflects the amount paid by the
fund to shareholders based on the profits it has from selling bonds that
have grown in value. Both returns assume the dividends or gains are
reinvested. Changes in the fund's share price include changes in the prices
of the bonds owned by the fund. Change in share price and total return
figures include the effect of the $5 account closeout fee on an average
size account.
DIVIDENDS AND YIELD
PERIODS ENDED FEBRUARY 28, 1994 PAST 30 PAST 6 PAST 1
DAYS MONTHS YEAR
Dividends per share n/a 22.02(cents) 44.88(cents)
Annualized dividend rate n/a 4.40% 4.46%
Annualized yield 3.91% n/a n/a
Tax-equivalent yield 5.88% n/a n/a
DIVIDENDS per share show the income paid by the fund for a set period. If
you annualize this number, based on an average share price of $10.10 over
the past six months and $10.07 over the past year, you can compare the
fund's income over these two periods. The 30-day annualized YIELD is a
standard formula for all funds based on the yields of the bonds in the
fund, averaged over the past 30 days. This figure shows you the yield
characteristics of the fund's investments at the end of the period. It also
helps you compare funds from different companies on an equal basis. The
tax-equivalent yield shows what you would have to earn on a taxable
investment to equal the fund's tax-free yield, if you're in the 36% tax
bracket.
FUND TALK: THE MANAGER'S OVERVIEW
An Interview with David Murphy, Portfolio Manager of Spartan
Short-Intermediate Municipal Fund
Q. DAVID, HOW DID THE FUND DO?
A. For the six months ended February 28, 1994, the fund had a total return
of 1.39%. That slightly edged out the average short municipal bond fund's
return of 1.24% for the same period, according to Lipper Analytical
Services.
Q. HOW DID YOU COME OUT AHEAD?
A. Having a longer-than-average duration - about 3.4 years at the end of
February - helped the fund when interest rates fell, as they generally did
during the last six months. Duration measures how much the fund's price
will vary with changes in interest rates. Typically, the longer the
duration, the more the fund's price will rise as interest rates fall. In
February, however, when the Federal Reserve raised short-term interest
rates by a quarter of a percentage point, having a long duration hurt the
fund.
Q. IN LIGHT OF THE FED'S MOVE, DID YOU CHANGE YOUR STRATEGY?
A. Since I'm somewhat concerned about interest rates rising over the short
term, I have recently started to shorten the fund's duration a bit. But I
haven't radically altered it, and the fund is still positioned to take
advantage of falling interest rates over the next few years. That's based
on my view that the Fed is very serious about being the inflation watchdog.
Low inflation is generally good for bonds. Historically, a pick-up in the
economy - like we saw in the fourth quarter of 1993 - means higher
inflation. But this time, I don't think that relationship will hold up.
Q. WHY NOT?
A. Because I think that inflation is low, lower than the market has
anticipated. We still haven't seen a broad-based increase in any of the
three basic components of higher inflation: commodity prices, labor costs
and the cost of borrowing money. While it's true that some commodity
prices, like gold, grains and copper, have risen, others, like oil,
haven't. Plus, some of the hike in agricultural prices can be attributed to
extraordinary factors like last year's flood and the recent cold weather.
Q. AND THE TWO OTHER INFLATIONARY
SIGNALS?
A. On the wage side, many U.S. companies now have the flexibility to move
their production overseas, where labor prices are often cheaper, and that
has kept pressure on domestic labor costs. Also, productivity has
increased, which means the actual cost of producing one unit of a given
good has come down. Finally, the cost of borrowing money or raising capital
is still low. In my view, these all add up to continued low inflation,
which could in turn lead to falling interest rates.
Q. SO HOW HAVE YOU STRUCTURED THE FUND?
A. I've concentrated a large amount of the fund - about 40% at the end of
February - in bonds with three- to five-year maturities. Up to five years,
the yield curve, or the difference in yield between bonds of different
maturities, is steep. Right now you get rewarded with 1.25% more yield for
buying bonds in the four-year range, for instance, than a bond in the
one-year range.
Q. WHAT STATES DID YOU FAVOR?
A. I've kept the fund's allocation among states about the same over the
past six months. At the end of February, one of the fund's largest state
concentrations was Texas, at 10.8%. I like Texas bonds because the economy
there is better than in most states, and so the bonds should do well.
Massachusetts was the fund's largest state concentration at 11.2%. Many of
these bonds are student loan bonds.
Q. WHY WERE STUDENT LOAN BONDS
ATTRACTIVE?
A. In late 1993, there was a flood of new student loan bonds issued due to
a change in reimbursement for loans made after October 1. So issuers had an
incentive to bring their deals to market quickly. That heavy supply pushed
prices down and made these bonds attractive. Going forward, the supply of
these bonds should dry up some, which could help their prices go higher.
Student loan bonds were included in the fund's largest industry
concentration, education bonds, which stood at 28.3% of investments on
February 28.
Q. WHAT OTHER SECTORS WERE ATTRACTIVE?
A. General obligation bonds (GOs), which are backed by the taxing power of
the issuer, were the fund's second largest sector concentration at 20.7%.
Economic recovery could translate into higher revenues for municipalities,
resulting from increased income and sales taxes. That, in turn, could help
the prices of GOs.
Q. WHAT DO YOU THINK INVESTORS CAN EXPECT FOR THE NEXT SIX MONTHS?
A. More volatility. The municipal bond market seems to be expecting the Fed
to raise short-term interest rates to 4%. Until that happens, the market
will probably remain unsettled. But eventually, I believe intermediate
municipal rates will start to fall again, and short-rates will remain
stable.
Q. HOW WILL THAT OUTLOOK AFFECT YOUR STRATEGY?
A. I'll probably keep the fund's duration somewhat long, but try to hedge
it against short-term volatility. Apart from interest rates, there are a
number of other factors that could help municipal bonds. Last year, the
total supply of municipals issued was about $290 billion. This year, it's
expected to be about half of that. A dwindling supply would be an
additional positive for municipal bond prices.
FUND FACTS
GOAL: to provide a current
income exempt from federal
income tax by investing in
high-grade and medium-grade
securities
START DATE: December 24,
1986
SIZE: as of February 28, 1994,
over $1.2 billion
MANAGER: David Murphy since
December 1989; manager,
Spartan California Intermediate
Municipal Portfolio, since
December 1993; Spartan New
York Intermediate Portfolio,
since December 1993;
Spartan Intermediate
Municipal Portfolio, since May
1993; Spartan New Jersey
Municipal High Yield Portfolio,
since April 1991; Fidelity
Limited Term
Municipals, since December
1989
(checkmark)
DAVID MURPHY ON SHORT-
INTERMEDIATE BONDS:
"I think that short-intermediate
bonds will once again be
attractive in 1994. The yield
curve, or the difference in
yield between bonds with
various maturities, is very
steep up to five years. A
five-year Aaa bond has a yield
of about 4.5%, compared to a
one-year bond which yields
about 3.0%. What's more,
some institutional investors
have started to increase their
investments in intermediate
bonds. That increased
demand could be an
additional positive for
intermediate municipal bond
prices."
(bullet) Education bonds were the
fund's largest sector at 28.3%
of the fund's investments at
the end of February. Of those,
26.7% were student loan
bonds and the balance were
university bonds. Student
loan bonds were attractive in
part because loan defaults
are reimbursed by the federal
government and the bonds
usually carry a high rating.
They also offer relatively high
yields.
(bullet) On February 28, the fund's
second largest sector at
20.7% of investments was
local and state general
obligation bonds (GOs),
which are backed by the
taxing power of the issuer.
The fund focused on GOs that
offered relatively high yields.
INVESTMENT CHANGES
TOP FIVE STATES AS OF FEBRUARY 28, 1994
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
6 MONTHS AGO
Massachusetts 11.2 9.4
Texas 10.8 14.7
Louisiana 8.3 11.8
California 7.5 6.5
Washington 5.5 4.9
TOP FIVE SECTORS AS OF FEBRUARY 28, 1994
% OF FUND'S % OF FUND'S
INVESTMENTS INVESTMENTS
6 MONTHS AGO
Education 28.3 30.0
General Obligation 20.7 21.5
Electric Revenue 12.4 9.4
Escrowed/Pre-Refunded 10.4 13.4
Transportation 6.2 5.2
AVERAGE YEARS TO MATURITY AS OF FEBRUARY 28, 1994
6 MONTHS AGO
Years 3.9 3.8
AVERAGE YEARS TO MATURITY SHOWS THE AVERAGE TIME UNTIL THE PRINCIPAL OF THE
BONDS IN THE FUND IS EXPECTED TO BE REPAID, WEIGHTED BY DOLLAR AMOUNT.
DURATION AS OF FEBRUARY 28, 1994
6 MONTHS AGO
Years 3.4 3.2
DURATION SHOWS HOW MUCH A BOND'S PRICE FLUCTUATES WITH CHANGES IN INTEREST
RATES. IF RATES RISE 1%, FOR EXAMPLE, THE SHARE PRICE OF A FUND WITH A
FIVE-YEAR DURATION WILL FALL 5%.
QUALITY DIVERSIFICATION AS OF FEBRUARY 28, 1994
(MOODY'S RATINGS)
Aaa 50.7%
Aa 7.1%
A 39.2%
Baa 2.0%
Non-Rated 9.2%
Row: 1, Col: 1, Value: 9.199999999999999
Row: 1, Col: 2, Value: 2.0
Row: 1, Col: 3, Value: 39.2
Row: 1, Col: 4, Value: 7.1
Row: 1, Col: 5, Value: 50.7
THIS CHART EXCLUDES SHORT-TERM INVESTMENTS. WHERE MOODY'S RATINGS ARE NOT
AVAILABLE, WE HAVE USED S&P RATINGS.
INVESTMENTS FEBRUARY 28, 1994 (UNAUDITED)
Showing Percentage of Total Value of Investments
MUNICIPAL BONDS - 96.8%
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
ALABAMA - 0.2%
Mobile Rfdg. & Impt. 5% 2/15/98, (MBIA Insured) $ 2,000 $ 2,055
607114WB
ALASKA - 4.8%
Alaska Student Loan Corp. Student Loan Rev.
6.90% 7/1/96, (AMBAC Insured) (b) 3,800 4,014 011857BD
North Slope Borough:
Gen. Oblig. Rfdg. Series 1988 G, 7.50% 6/30/97,
(AMBAC Insured) 28,015 30,921 662523NQ
Series B:
0% 1/1/99, (MBIA Insured) 8,000 6,400 662523RM
0%, 1/1/01, (MBIA Insured) 5,000 3,588 662523RP
Series G:
Rfdg. 8.35% 6/30/98, (MBIA Insured) 8,000 9,250 662523PF
Unltd. Tax 8.35% 6/30/98 (MBIA Insured) 4,000 4,555 662523NR
58,728
ARIZONA - 2.1%
Maricopa County School Dist. #4 (Mesa Unified):
(Cap. Appreciation) 0% 7/1/98, (FGIC Insured) 2,600 2,148 566897LQ
Dist. #28 Rfdg. 0% 7/1/00, (FGIC Insured) 2,500 1,859 567137SN
Rfdg. 6% 7/1/97, (AMBAC Insured) 5,000 5,281 566897LG
Series D, 6% 7/1/01, (FGIC Insured) 9,300 9,998 566897LL
Trans. Board Excise Tax Rev. Reg. Area
7.40% 7/1/98 (FGIC Insured) 3,750 4,148 040649AV
Tempe Unified High School Dist. #213 Rfdg.
0% 7/1/00, (FGIC Insured) 3,860 2,852 879743DW
26,286
CALIFORNIA - 7.5%
California Gen. Oblig. 6.65% 4/1/00 4,000 4,380 130621RM
California Pub. Works Board Lease Rev. Rfdg.
(Dept. of Corrections State Prison):
Series A:
4.50% 12/1/98 4,600 4,583 13068GNN
5% 12/1/01 4,735 4,723 13068GNR
Series E:
4.50% 6/1/00 4,035 3,949 13068GVD
4.625% 6/1/01 4,795 4,687 13068GVE
Clovis California Unified School Dist.
(Cap. Appreciation) Series B, 0% 8/1/00 7,000 5,040 189342QD
First California Pre-Refunded Pooled
Custodial Receipts RIB Series A,
18.091% 12/1/97 (a)(c) 12,950 18,357 31938RAB
MUNICIPAL BONDS - CONTINUED
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
CALIFORNIA - CONTINUED
Los Angeles Dept. of Water and Pwr. Rev:
Second Issue (Electric Plant) 9% 10/15/00 $ 1,300 $ 1,607 544507JG
9% 10/15/01 2,000 2,525 544507JH
Los Angeles Wastewtr. Sys. Rev. Series B,
9% 6/1/96, (AMBAC Insured) 2,305 2,544 544652QA
Northern California Pwr. Agcy. Pub. Pwr. Rev.
Rfdg. (Geothermal Proj. #3) Series A,
8.80% 7/1/95 2,750 2,929 664843DB
Redlands Ctfs. of Prtn. Rfdg. (Wtr. Treatment
Facs. Proj.) 4.50% 9/1/15, (FGIC Insured) 23,200 23,519 757564GL
Rosemead Redev. Agcy. (Sub. Lien Tax
Allocation Proj. Area 1):
0% 10/1/96 2,235 2,014 777520BF
0% 10/1/97 1,875 1,610 777520BG
0% 10/1/98 1,000 811 777520BH
0% 10/1/99 2,205 1,701 777520BJ
San Bernardino County Ctfs. of Prtn.
(Medical Center Fing. Proj.) 4.75%, 8/1/00 4,000 3,930 796815NS
Univ. of California Rev. Rfdg. (Multiple
Purpose Projs.) Series C, 10% 9/1/99,
(AMBAC Insured) 2,605 3,279 914113RX
92,188
COLORADO - 2.9%
Adams County Multi-Family Hsg. Rev. Rfdg. Series A
5.20% 6/1/03, LOC Columbia Savings & Loan 1,000 1,003 005618DK
Colorado Ctfs. of Prtn. Rfdg. & Acquisition Projs.:
4.20% 5/1/95, (AMBAC Insured) 3,250 3,282 196711EQ
4.75% 5/1/97, (AMBAC Insured) 4,000 4,080 196711EU
4.75% 11/1/97, (AMBAC Insured) 2,750 2,812 196711EV
Colorado Student Oblig. Bond Auth. Student
Loan Rev. Series A, 6% 6/1/94 1,760 1,769 196777FR
Denver City & County Arpt. Rev.:
(Stapleton Int'l. Arpt.) 10% 12/1/95,
(Escrowed to Maturity) (d) 400 435 249181EP
Rev. Series B, 4.25% 12/1/25,
(LOC Sumitomo Bank) 15,000 15,000 249181KY
Jefferson County School Dist. #R-1 Rfdg. Series A,
5.50% 12/15/01 5,000 5,225 472736XV
Pueblo Wtr. Rfdg. Series 1984 B, 9.50% 11/1/98,
(MBIA Insured) 2,250 2,666 744720MY
36,272
MUNICIPAL BONDS - CONTINUED
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
CONNECTICUT - 0.8%
Connecticut Resources Recovery Auth. Rev.:
(Bridgeport Resco Co. LP Proj.) Series B:
8% 1/1/95 $ 1,980 $ 2,042 207755BM
8.10% 1/1/96 2,960 3,152 207755BN
8.20% 1/1/97 1,490 1,609 207755BP
(Mid-Connecticut Sys.) Series A, 8.25%
11/15/94, (MBIA Insured) 2,500 2,575 207755AY
9,378
DELAWARE - 0.1%
Delaware Trans. Auth. Trans. Sys. Rev.
7.75% 7/1/06, (MBIA Insured) (Pre-Refunded to
7/1/98 @ 101.50) 1,500 1,721 246428BL
DISTRICT OF COLUMBIA - 1.5%
District of Columbia Series E:
4.75% 6/1/00, (FGIC Insured) 1,825 1,825 254760J9
5% 6/1/02, (FGIC Insured) 3,850 3,874 254760K2
District of Columbia Rfdg. Unltd. Tax Series A2
4.55% 6/1/01 (AMBAC Insured) 4,000 3,915 254760R2
District of Columbia Unltd. Tax:
Series A, 7.20% 6/1/97, (AMBAC Insured) 2,665 2,908 254760QL
Series B, 5.50% 6/1/98, (MBIA Insured) 6,165 6,427 254760XN
18,949
FLORIDA - 2.0%
Florida Ctfs. of Prtn. (Consolidated Equip. Fing.
Prog.) 5.90% 5/15/96 17,790 18,300 341598PZ
Florida Lease Ctfs. of Prtn 5.75%, 11/15/95 6,000 6,158 341598PP
24,458
GEORGIA - 1.2%
Burke County Dev. Auth. Poll. Cont. Rev.
(Oglethorpe Pwr. Corp. - Vogtle Proj.):
Series B:
10% 1/1/95 1,280 1,300 121342BV
10.10% 1/1/96 1,000 1,015 121342BW
10% 1/1/96 2,000 2,040 121342BH
Georgia Muni. Elec. Auth. Pwr. Rev. Series J,
9.90% 1/1/97 1,190 1,285 373540KW
Gwinnett County Wtr. & Swr. Ctfs. of Prtn.
7.75% 8/1/96 3,850 4,182 403712AE
MUNICIPAL BONDS - CONTINUED
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
GEORGIA - CONTINUED
Monroe County Dev. Auth. Poll. Cont. Rev. (Ogelthorpe
Pwr. Corp. Scherer) Series A, 5.75% 1/1/00 $ 4,330 $ 4,579 610530BQ
14,401
HAWAII - 0.4%
Hawaii Arpts. Sys. Rev. Rfdg. Series 1993:
4.50% 7/1/95, (MBIA Insured) 1,685 1,710 419794PD
4.85% 7/1/96, (MBIA Insured) 1,770 1,808 419794PE
5.10% 7/1/97, (MBIA Insured) 1,860 1,909 419794PF
5,427
ILLINOIS - 3.1%
Chicago Metropolitan Wtr. Reclamation 6% 1/1/98 2,875 3,044 167537PC
Chicago O'Hare Int'l. Arpt. Spl. Facs. Rev. Int'l.
Terminal) 5.50% 1/1/98, (MBIA Insured) (b) 3,460 3,577 167590CA
Illinois Edl. Facs. Auth. Rev.:
(Art Institute) 7.50% 3/1/27, LOC Mitsubishi Bank Ltd.
(DePaul Univ.) Series A, 9.10% 10/1/97,
(Pre-Refunded to 10/1/95 @ 103) (d) 500 556 452000WN
Mitsubishi Bank Ltd. (Putable to 9/1/94 @ 100) 2,840 2,886 452000R6
Illinois Scholarship Commission Student Loan Rev.:
Series F, 7% 3/1/96 (b) 6,500 6,711 452229CP
Series G, 8.10% 3/1/98 (b) 3,500 3,631 452229DB
Series I, 0.02% 3/1/96 (b) 8,725 8,005 452229EF
McHenry County Conservation Dist. (Cap.
Appreciation) 0% 2/1/96, (AMBAC Insured) 1,630 1,508 580818AR
Metropolitan Pier & Export Auth. Dedicated
Tax Rev. (McCormick Place Expansion Proj.):
Series A, 0% 6/15/96, (AMBAC Insured) 4,055 3,700 592247BG
0% 6/15/95, (AMBAC Insured) 2,500 2,391 592247BD
Rock Island County Ctfs. of Prtn.:
10% 12/1/94, (FGIC Insured) 715 751 772321AD
10% 12/1/95, (FGIC Insured) 790 873 772321AE
10% 12/1/96, (FGIC Insured) 840 966 772321AF
38,599
IOWA - 0.7%
Iowa School Corp. (warrant ctfs.) 3.60%
12/30/94, (Cap. Guaranty Insured) 8,800 8,849 462539AS
KENTUCKY - 2.5%
Kentucky Tpk. Auth. Econ. Dev. Road Rev. Rfdg.
(Revitalization Projs.):
5% 1/1/98, (FGIC Insured) 1,750 1,787 491552EM
4.60% 7/1/98, (AMBAC Insured) 3,000 3,045 491552GA
5.375% 1/1/00 5,000 5,181 491552EP
MUNICIPAL BONDS - CONTINUED
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
KENTUCKY - CONTINUED
Louisville & Jefferson County (Reg. Arpt. Auth. Arpt. Sys.
Rev.) Series C, 4.75% 7/1/00, (MBIA Insured) (b) $ 6,480 $ 6,447
546596BW
Owenboro Elec. Lt. and Pwr. Rev. Rfdg. Series B:
0%, 1/1/96, (AMBAC Insured) 1,425 1,331 691021HF
0% 7/1/96, (AMBAC Insured) 1,400 1,279 691021HG
0% 1/1/97, (AMBAC Insured) 3,025 2,685 691021HH
0% 7/1/97, (AMBAC Insured) 1,000 869 691021HJ
0% 1/1/98, (AMBAC Insured) 2,000 1,688 691021HK
0% 1/1/99, (AMBAC Insured) 3,300 2,640 691021HM
0% 1/1/01, (AMBAC Insured) 5,450 3,890 691021HR
30,842
LOUISIANA - 8.3%
East Baton Rouge Parish Sales and Use Tax
(Pub. Impt.) 12% 2/1/97, (MBIA Insured) 1,000 1,206 270848AH
Jefferson Sales Tax Dist. Spl. Sales Tax Rev.
Series A:
Rfdg. 6.50% 12/1/00, (FGIC Insured) 3,195 3,511 474176CY
6.25% 12/1/98, (FGIC Insured) 3,000 3,240 474176CU
6.375% 12/1/99, (FGIC Insured) 1,000 1,088 474176CW
Louisiana Gen. Oblig.:
Rfdg. Series A:
6.50% 9/1/95 1,000 1,018 546416PE
6.40% 8/1/96 3,100 3,247 546414BJ
8% 5/1/97, (MBIA Insured) 7,995 8,894 546414GV
8% 5/1/98, (MBIA Insured) 4,080 4,641 546414GW
8% 5/1/99, (MBIA Insured) 8,460 9,792 546414GX
Series C, 9.375% 10/1/94 1,325 1,365 546414AD
8% 9/1/95 3,365 3,542 546414FS
Louisiana Hsg. Fin. Agcy. Mtg. Rev. Rfdg.
(Residential Lien) Series 1992, 0% 3/1/95 (e) 6,615 6,276 546265XL
Louisiana Pub. Facs. Auth. Rev.:
(Loyola Univ.) 9% 10/1/95 9,710 10,510 546396TN
(Student Loan):
Sr. Series A-2, 5.90% 3/1/98 (b) 3,000 3,086 54640AJL
Sr. Series A-1, 5.90% 3/1/99 3,000 3,109 54640AJQ
(Browning-Ferris Ind., Inc.) 3.85% 11/1/96 5,000 4,938 54640AQW
(Supplemental Student Loan):
Series B, 8.125% 12/1/99, (AMBAC Insured) 8,840 10,265 546396MZ
Series C, 8.125% 12/1/99, (AMBAC Insured) 4,200 4,877 546396NA
MUNICIPAL BONDS - CONTINUED
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
LOUISIANA - CONTINUED
Louisiana Recovery Dist. Sales Tax Rev.:
Rfdg.:
5.50% 7/1/97, (MBIA Insured) $ 5,935 $ 6,165 546513BT
5.70% 7/1/98 2,500 2,613 546513BN
7.625% 7/1/96 7,500 7,978 546513AN
Ouachita Parish Hosp. Svc. Dist. #1 Rev.
(Glenwood Regional Med. Ctr.):
6.50% 7/1/95 395 406 689837BB
6.70% 7/1/96 475 497 689837BC
102,264
MAINE - 1.1%
Maine Edl. Loan. Marketing Corp. Student Loan Rev. Rfdg.:
Series A-1:
6.20% 11/1/95 (b) 7,250 7,431 560409AA
4.95% 5/1/96 (b) 1,200 1,218 560409AK
5.60% 12/1/96 (b) 2,720 2,812 560404AA
5.20% 5/1/97 (b) 1,750 1,785 560409AL
13,246
MARYLAND - 1.3%
Northeast Waste Disp. Auth. Resources Recovery
Rev. Rfdg. (Southwest Resources Recovery Fac.):
6.40% 1/1/95, (MBIA Insured) 1,075 1,099 664252BC
6.50% 1/1/96, (MBIA Insured) 3,000 3,135 664252BE
6.85% 1/1/99, (MBIA Insured) 4,000 4,385 664252BL
6.90% 1/1/00, (MBIA Insured) 5,000 5,531 664252BN
Prince George's County 6.20% 3/15/99, (MBIA Insured) 1,985 2,159
741701CG
16,309
MASSACHUSETTS - 11.2%
Fall River Gen. Oblig. Ltd. Tax 8% 6/1/96,
(MBIA Insured) 725 792 306297RA
Massachusetts Gen. Oblig.:
(Cap. Appreciation) Series A, 0% 6/1/97 3,930 3,424 575825WA
Rfdg. Series C:
4.90% 9/1/98 2,000 2,033 575825YH
5.10% 9/1/99 3,750 3,825 5758232T
Spl. Tax RIB 17.905% 6/1/97, (FGIC Insured) (c) 5,050 6,186 575825ZE
17.57% 6/1/97 (a)(c) 14,300 17,339 575825ZK
MUNICIPAL BONDS - CONTINUED
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Massachusetts Hsg. Fin. Agcy. Rfdg. (Hsg. Proj.)
Series A, 4.60% 4/1/97 $ 4,095 $ 4,131 575852UU
Massachusetts Ind. Fin. Agcy. Rev. Cap. Appreciation
(Massachusetts Biomedical Research) Series A-1:
7.10% 8/1/99 4,500 4,905 575914DU
0% 8/1/00 4,510 3,242 575914DV
Massachusetts Muni. Wholesale Elec. Co. Pwr.
Supply Sys. Rev. Rfdg.:
Series A, 4.10% 7/1/98, (AMBAC Insured) 1,000 990 575765MG
Series E, 5.375% 7/1/99, (AMBAC Insured) 4,260 4,414 575765PN
New England Ed. Loan Marketing Corp. Rfdg.
(Massachusetts Student Loan):
Sr. Issue D, 6% 9/1/99 7,000 7,341 643898AW
Series A, 6% 9/1/98 (b) 11,500 12,061 643898AR
Series B, 5.40% 6/1/00 6,250 6,383 643898BG
Series E, 5% 7/1/99 25,400 25,621 643897AD
Series G:
4.70% 8/1/98 6,675 6,700 643898BJ
5% 8/1/00 8,350 8,350 643898BK
Series H, 4.75% 12/1/99 21,000 20,948 643898BM
138,685
MICHIGAN - 1.4%
Detroit Convention Fac. Rev. Rfdg.
(Cobo Hall Expansion Project):
3.75% 9/30/96 2,090 2,064 251131AT
4% 9/30/97 2,000 1,965 251131AU
4.75% 9/30/00 5,220 5,148 251131AX
4.80% 9/30/01 3,855 3,783 251131AY
Detroit Gen. Oblig. Rfdg. (Distributable Aid)
3.40% 5/1/95, Non-Callable (AMBAC Insured) 4,240 4,245 251093JE
17,205
MINNESOTA - 0.9%
Southern Minnesota Muni. Pwr. Agcy. Pwr.
Supply Sys. Rev. Rfdg.:
Series A:
6.80% 1/1/95 1,000 1,026 843375DH
4.60% 1/1/01 2,000 1,990 843375NA
Series B, 5.1% 1/1/99 4,875 5,022 843375LS
Southern Minnesota Pwr. Rfdg. 4.4% 1/1/00 2,500 2,475 843375MZ
10,513
MUNICIPAL BONDS - CONTINUED
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
MISSISSIPPI - 1.3%
Mississippi Higher Ed. Assist Corp. Student Loan
Rev. Series B, 4.80% 9/1/98 $ 15,500 $ 15,461 605354CW
MONTANA - 4.0%
Montana Dept. Hwy. Trans. Rev. Rfdg. 4.50% 7/1/98 4,000 4,040 61212MAF
Montana Higher Ed. Student Loan Assistance
Corp. Student Loan Rev.:
Sr.:
4.30% 12/1/96 3,500 3,504 612130DB
4.50% 12/1/97 3,770 3,779 612130DD
4.70% 12/1/98 (b) 9,225 9,260 612130DF
4.90% 12/1/99 (b) 12,420 12,468 612130DH
Sr. Series A, 4.75% 12/1/98 3,600 3,636 612130DE
Series B:
6.20% 12/1/97 (b) 4,315 4,498 612130CF
6.40% 6/1/98 (b) 3,875 4,064 612130CH
6.40% 12/1/98 (b) 4,455 4,694 612130CK
49,943
MULTIPLE STATES - 1.4%
California Higher Ed. Loan Student Loan Auth.
Rev. Rfdg. Series E-2, 5.70% 12/1/98 (b) 4,000 4,150 130327BJ
IBM Tax Exempt Grantor Trust (Asset
Backed Ctfs.) Series D, 6.15% 9/30/95 508 508 643898AX
New England Ed. Loan Marketing Corp. Student
Loan Rev. Rfdg. Sr. Issue D, 6.20% 9/1/00 1,100 1,169 643898AX
Washington DC Metro Area Transit Auth. Gross
Rev. Rfdg.:
4.40% 7/1/00, (FGIC Insured) 4,725 4,695 938782AN
4.50% 7/1/01, (FGIC Insured) 1,655 1,638 938782AQ
4.60% 1/1/02, (FGIC Insured) 4,930 4,881 938782AR
17,041
NEVADA - 0.2%
Clark County Passenger Facs. Charge Rev. (Las Vegas
McCarran Int'l. Arpt.) Series A, 4.95% 7/1/97
(AMBAC Insured) 3,000 3,064 181006AA
NEW HAMPSHIRE - 1.3%
New Hampshire Higher Edl. & Health Facs. Auth.
Rev. (Frisbie Mem. Hosp.) 9.50% 10/1/08
(Pre-Refunded to 7/21/97 @ 103) (d) 13,960 16,612 644618NQ
MUNICIPAL BONDS - CONTINUED
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
NEW JERSEY - 2.7%
Delaware River Joint Toll Bridge Commission
Bridge Rev. Series I-78, 7.80% 7/1/18,
(FGIC Insured) (Pre-Refunded to 7/1/98 @ 102) (d) $ 1,450 $ 1,671
246343CB
Essex County Rfdg. (Cap. Appreciation) 0%
12/1/98 (FGIC Insured) 1,120 911 296803H9
Jersey City School Unltd. Tax 6.40% 2/15/96 1,675 1,752 476575DD
New Jersey Health Care Facs. Fing. Auth. Rev.
(Atlantic City Med. Ctr.):
Series B, 8.375% 8/1/20, (FHA Guaranteed)
(Pre-Refunded to 2/1/98 @ 102) (d) 6,820 7,921 645793SW
Series C:
5.30% 7/1/95 3,615 3,696 64579CKT
5.60% 7/1/96 3,300 3,424 64579CKU
5.80% 7/1/97 4,005 4,200 64579CKV
New Jersey Tpk. Auth. Tpk. Rev. Series A:
5.75% 1/1/97 3,695 3,852 646139HC
5.20% 1/1/98 5,000 5,144 646139KC
5.40% 1/1/99 1,000 1,039 646139KD
33,610
NEW MEXICO - 1.7%
New Mexico Edl. Assistance Foundation Student Loan Rev.:
Sr.:
Series 1-A, 4.80% 12/1/95 1,750 1,774 647111AN
Series III A-1, 5.55% 12/1/02 (b)(f) 5,000 4,906 647111CD
Series A:
6.05% 4/1/97, (AMBAC Insured ) (b) 4,025 4,146 647111AC
6.255 4/1/98, (AMBAC Insured) (b) 4,775 4,977 647111AD
6.55% 4/1/00, (AMBAC Insured) (b) 2,700 2,876 647111AF
7% 9/1/94, LOC Fuji Bank (b) 2,045 2,081 647110AX
20,760
NEW YORK - 1.8%
New York City Muni. Wtr. Fing. Auth Rev.
(Wtr. and Swr. Sys.) Series B, 4.75% 6/15/01 3,000 2,981 649706ZS
New York State Gen. Oblig.:
Crossover Rfdg. 7.80% 11/15/98 12,820 14,599 64978HET
Rfdg. 7.80% 11/15/99 3,780 4,366 6497852W
21,946
NORTH CAROLINA - 1.8%
North Carolina Eastern Muni. Pwr. Agcy. Pwr. Sys. Rev.:
Series A, 7.875% 1/1/02 8,000 9,420 658196JZ
Series E, 9% 1/1/1995 2,000 2,085 658196EJ
MUNICIPAL BONDS - CONTINUED
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
NORTH CAROLINA - CONTINUED
North Carolina Muni. Pwr. Agcy. #1 Catawba Elec. Rev.:
Rfdg. 5.10% 1/1/98 $ 3,750 $ 3,848 658203PX
4.20% 1/1/98 7,000 6,983 658203RL
22,336
NORTH DAKOTA - 0.2%
North Dakota Student Loan Rev. Rfdg. Series A,
5.70% 7/1/97 2,315 2,396 659005ED
OHIO - 2.8%
Cincinnati City School Dist.:
Ltd. Tax 5.40% 6/1/96 4,000 4,130 172252SA
5.35% 6/15/96 2,700 2,781 172252SF
5.60% 6/15/97 3,000 3,124 172252SG
Clermont County Hosp. Facs. Rev. (Mercy Health Care
System) 9.75% 9/1/13, (AMBAC Insured) 10,000 11,100 185705BM
Franklin County Rev. (OCLC-Online Computer
Library Ctr.) Series 1991:
5.80% 7/15/94 705 709 353202AP
6% 7/15/95 745 760 353202AQ
4.70% 4/15/96 270 270 353202BC
Montgomery County Hosp. Facs. Rev.
(Miami Valley Hosp.) Series A, 9% 12/1/96 1,500 1,650 613520DS
Ohio Dev. Commission (Globe Ind. Project)
Series 1, 7.75% 6/1/96, (Escrowed to
Maturity) (Pre-Refunded to 6/1/96) (b) 1,000 1,014 677555GA
Orrville Ind. Dev. Rev. (Ingersoll-Rand Co. Proj.)
12% 7/1/94 2,500 2,556 687466AA
Student Loan Funding Corp. Ohio Student Loan
Series A, 5.50% 12/1/01 (b) 7,000 7,035 863869BL
35,129
OKLAHOMA - 1.4%
Grand River Dam Auth. Rev. Rfdg.:
4.90% 6/1/98 11,000 11,289 386442NX
5% 6/1/99 2,570 2,634 386442NY
Oklahoma Student Loan Auth. Rev. Rfdg.
(Student Loan) Series A, 5.35% 9/1/96 (b) 1,930 1,947 679110BM
Tulsa Ind. Auth. Hosp. Rev. (Tulsa Regional
Med. Ctr.) Series 1991 A:
6.50% 6/1/94 500 503 899652AZ
6.75% 6/1/95 500 516 899652BA
7% 6/1/96 500 526 899652BB
17,415
MUNICIPAL BONDS - CONTINUED
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
OREGON - 0.4%
Tri City Dist. Oregon Advanced Rfdg. Swr:
5% 9/1/00 $ 2,100 $ 2,153 895428BP
5% 9/1/01 2,135 2,183 895428BQ
4,336
PENNSYLVANIA - 2.8%
Erie County School Dist. (Cap. Appreciation):
0% 6/1/1996 785 715 295528AM
0% 12/1/1996 1,125 1,004 295528AN
0% 6/1/1997 1,435 1,243 295528AP
0% 12/1/1997 1,405 1,189 295528AQ
0% 6/1/1998 905 744 295528AR
0% 12/1/1998 1,770 1,418 295528AS
Northampton County Ind. Dev. Auth. Rev. (Poll. Cont.)
(Metro Edison Co.) 10.50% 9/1/95 4,000 4,395 663549DL
Pennsylvania Tpk. Community Tpk. Rev.
Series A, 7.875% 12/1/15 9,500 10,629 709223BH
Philadelphia Gas Wks. Rev. Fifteenth Series Rfdg.:
4.10% 8/1/99, (AMBAC Insured) 2,000 1,960 717823RJ
4.10% 8/1/99, (MBIA Insured) 3,845 3,768 717823SB
4.25% 8/1/00, (AMBAC Insured) 2,325 2,273 717823RK
Philadelphia School Dist. Rfdg. Series A, 6.25%
7/1/97, (AMBAC Insured) 3,500 3,736 717880YX
St. Mary's Hosp. Auth. Bucks County Rev. (St. Mary's
Hosp. Langhorne Proj.) 11.75% 7/1/14,
(Pre-Refunded to 7/1/94 @ 102) (d) 1,965 2,049 792222BS
35,123
RHODE ISLAND - 1.6%
Rhode Island Consolidated Cap. Loan Unltd.
Tax Rev. 8% 8/1/98 4,470 5,090 762221WA
Rhode Island Student Loan Auth. Student Loan
Rev. Rfdg. Series A, 6% 12/1/97 14,000 14,560 762315AJ
19,650
TENNESSEE - 0.1%
Metropolitan Nashville Arpt. Auth. Arpt. Rev.
3.80% 7/1/94, (FGIC Insured) (b) 1,000 1,004 592192AB
TEXAS - 10.7%
Alamo Community Dist. Rfdg.:
0% 2/15/99 (AMBAC Insured) 3,530 2,798 011415CS
0% 2/15/00, (AMBAC Insured) 3,350 2,513 011415CT
MUNICIPAL BONDS - CONTINUED
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
TEXAS - CONTINUED
Arlington Independent School Dist. Rfdg.
(Cap. Appreciation) 0% 8/15/97,
(MBIA Insured) $ 1,250 $ 1,088 041826DY
Austin Gen. Oblig. Rfdg. Pub. Impt. Series B,
0%, 9/1/00, (MBIA Insured) 3,560 2,608 052394GQ
Austin Util. Sys. Rev. Rfdg.:
(Prior Lien):
Series B, 7% 11/15/98, (FGIC Insured) 8,000 8,850 052473YZ
9% 11/15/94 1,500 1,562 052473MN
Series A, 0% 11/15/98, (MBIA Insured) 3,000 2,426 0524734L
Austin Wtr. Swr. & Elec. Rev. Rfdg.:
12.75% 5/15/94 1,550 1,575 052478AZ
11% 11/15/96 12,505 14,364 052478BF
Brazos Higher Ed. Auth. Student Loan Rev. Rfdg:
Series A:
5.40% 3/1/94 5,470 5,470 106238BT
5.60% 9/1/94 (b) 7,230 7,275 106238BU
Series C:
4.75% 6/1/97 (b) 11,600 11,658 106238DN
4.95% 6/1/98 (b) 11,700 11,773 106238DP
5.15% 6/1/99 (b) 13,250 13,366 106238DQ
5.40% 6/1/01 (b) 5,000 5,056 106238DS
Colorado River Water Resources Auth. 8.5%
1/1/01 2,200 2,654 196558GL
Dallas Independent School Dist. Rfdg. Unltd. Tax.
(Cap. Appreciation):
0% 8/15/96, (PSF Guaranteed) 5,000 4,575 2353073P
0% 8/15/97, (PSF Guaranteed) 12,400 10,804 2353073Q
Denton Independent School Dist. Rfdg.
(Cap. Appreciation) 0% 2/15/98, (PSF Guaranteed) 3,960 3,331 249001SM
Harris County Toll Road Sub. Lien. Rev. Unltd.
Tax Rfdg. 0% 8/1/01 3,490 2,417 414003TA
Klein Public School Fund 0% 2/01/00 3,000 2,276 498530QN
North Texas Higher Ed. Auth. Student Loan
Rev. Series B, 4.85% 4/1/98 (b) 4,815 4,839 662826BW
Panhandle-Plains Higher Ed. Auth. Student
Loan Rev. Series C, 4.15% 9/1/97 2,800 2,779 698476CF
Richardson Independent School Dist. School
Bldg. 0% 8/15/00 (AMBAC Insured) 6,215 4,591 763260AP
Texas Higher Ed. Coordinating Board College
Student Loan Rev. (Sr. Lien) 6.60% 4/1/96 (b) 940 968 882751AF
131,616
MUNICIPAL BONDS - CONTINUED
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
UTAH - 0.8%
Intermountain Pwr. Agcy. Utah Pwr. Supply Rev.
0% 7/1/15 $ 14,000 $ 10,448 458840E3
VIRGINIA - 0.2%
Chesapeake Wtr. & Swr. Sys. Rev. 7.75% 7/1/17
(Pre-Refunded to 7/1/97 @ 102) (d) 1,700 1,925 165329AN
Virginia Hsg. Dev. Auth. (Multi-Family)
Series 1984 A, 9% 11/1/94 1,050 1,066 928134KY
2,991
WASHINGTON - 5.5%
Washington General Oblig. 9.10% 4/1/95,
(Non-Callable), (Escrowed to Maturity) 2,000 2,118 939740TJ
Washington Health Care Facs. Auth. Rev. Rfdg.:
(Franciscan Health Sys. St. Francis) 9.25%
7/1/15, (BIG Insured) (Pre-Refunded to 7/1/95
@ 102) 17,435 19,048 939780LN
(Group Health Coop. Puget Sound Seattle)
Series 1988 A, 7.40% 12/1/98, (MBIA Insured) 2,750 3,073 939780VL
(Northwest Hospital) 2.80% 11/15/94
(AMBAC Insured) 1,210 1,212 9397804U
(Pooled Cap. Facs. & Equip.) 7.30% 4/1/96,
(MBIA Insured) 580 587 939780WN
Washington Pub. Pwr. Supply Sys. Nuclear Rev. Rfdg.:
Proj. #1:
Series A:
4.625% 7/1/98 3,000 3,030 939827QJ
6.50% 7/1/02 1,000 1,090 939827NM
Series B, 5% 7/1/01 2,500 2,522 939827RX
Series C:
7.10% 7/1/96 2,235 2,383 939827ME
7.30% 7/1/98 6,370 7,044 939827MG
7.70% 7/1/02 2,500 2,938 939827ML
2.95% 7/1/94 8,000 8,000 939827TQ
Proj #2:
Series A:
5.10% 7/1/98 1,000 1,029 939828PC
6.50% 7/1/02 2,220 2,420 939828NJ
Series B:
7% 7/1/97 5,000 5,400 939830HZ
5% 7/1/00 2,150 2,185 939830ML
Series C, 7.10% 7/1/98 1,000 1,099 939828MJ
7.20% 7/1/99 1,000 1,114 939828MK
MUNICIPAL BONDS - CONTINUED
MOODY'S PRINCIPAL VALUE
RATINGS (A) AMOUNT (NOTE 1)
WASHINGTON - CONTINUED
Washington Pub. Pwr. Supply Sys. Nuclear Rev. Rfdg. - continued
Proj. #3 2.95% 7/1/94 $ 2,000 $ 2,000 939830PQ
68,292
WISCONSIN - 0.1%
Milwaukee Wisconsin Rfdg. 4.50% 12/1/98 1,000 1,003 602364LE
TOTAL MUNICIPAL BONDS
(Cost $1,185,313) 1,196,551
MUNICIPAL NOTES - 3.2%
FLORIDA - 0.5%
Naples Wtr. & Swr. Rev. BAN 6.70% 9/1/94
(Escrowed to Maturity) (d) 6,000 6,113 630514GZ
MICHIGAN - 0.2%
Farmington Hills Hosp. Fin. Auth. Hosp. Rev.
(Botsford Hosp.) 2.30%, (FGIC Insured)
Manufacturers Nat'l. Corp., VRDN 1,000 1,000 311166AV
Flint Hosp. Bldg. Auth. Rev. (Hurley Med. Ctr.)
Series 1985, 2.40%, LOC Comerica Bank, VRDN (a) 1,500 1,500 339509BD
2,500
MINNESOTA - 0.1%
Minnesota Higher Ed. Coordinating Board Rev.
(Supplemental Student Loan Prog.) Series 1984,
2.525%, LOC Mitsubishi Bank Ltd., VRDN (a) 1,500 1,500 604147BW
NEW YORK - 2.3%
New York City Hsg. Dev. Corp. Spl. (Carnegie
Park Proj.) Series 1984 A, 3.35% LOC
Sumitomo Trust & Banking Ltd., VRDN (a) 2,800 2,800 64970T9A
Niagara County Ind. Dev. Agcy. Ind. Dev. Rev.
4% 1/15/95 (mandatory put) 25,140 25,140 653358BK
27,940
TEXAS - 0.1%
Texas Gen. Oblig. TRAN 3.25% 8/31/94 1,200 1,203 882715V6
TOTAL MUNICIPAL NOTES
(Cost $39,217) 39,256
TOTAL INVESTMENTS - 100%
(Cost $1,224,530) $ 1,235,807
SECURITY TYPE ABBREVIATIONS
BAN - Bond Anticipation Notes
TRAN - Tax Revenue Anticipation Notes
VRDN - Variable Rate Demand Notes
LEGEND
1. The coupon rate shown on floating or adjustable rate securities
represents the rate at period end.
2. Private activity obligations whose interest is subject to the federal
alternative minimum tax for individuals (AMT securities).
3. Inverse floating rate security is a security where the coupon is
inversely indexed to a floating interest rate. The price will be more
volatile than the price of a comparable fixed rate security.
4. Security collateralized by an amount sufficient to pay interest and
principal.
5. A portion of the security was pledged to cover for delayed delivery
purchases. At the period end, the value of securities pledged amounted to
$4,744,000.
6. Security purchased on a delayed delivery basis (see Note 2 of Notes to
Financial Statements).
OTHER INFORMATION
The composition of long-term debt holdings as a percentage of total value
of investment in securities, is as follows (ratings are unaudited):
MOODY'S RATINGS S&P RATINGS
Aaa, Aa, A 89.2% AAA, AA, A 75.4%
Baa 1.9% BBB 1.9%
Ba 0.0% BB 0.0%
B 0.0% B 0.0%
Caa 0.0% CCC 0.0%
Ca, C 0.0% CC, C 0.0%
D 0.0%
The percentage not rated by either S&P or Moody's amounted to 1.6%.
The distribution of municipal securities by revenue source, as a percentage
of total value of investment in securities, is as follows:
Education 28.3%
General Obligation 20.7
Electric Revenue 12.4
Escrowed/pre-refunded 10.4
Others (individually less than 10%) 28.2
TOTAL 100.0%
INCOME TAX INFORMATION
At February 28, 1994, the aggregate cost of investment securities for
income tax purposes was $1,224,530,000. Net unrealized appreciation
aggregated $11,277,000 of which $15,955,000 related to appreciated
investment securities and $4,678,000 related to depreciated investment
securities.
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
<S> <C> <C>
(EXCEPT PER-SHARE AMOUNTS) FEBRUARY 28, 1994 (UNAUDITED)
ASSETS
Investment in securities, at value (cost $1,224,530) $ 1,235,807
(Notes 1 and 2) - See accompanying schedule
Receivable for investments sold 12,244
Interest receivable 18,511
Receivable from investment adviser for expense 143
reductions (Note 6)
TOTAL ASSETS 1,266,705
LIABILITIES
Payable to custodian bank $ 11
Payable for investments purchased 9,180
Regular delivery
Delayed delivery (Note 2) 5,000
Payable for fund shares redeemed 7,174
Dividends payable 511
Accrued management fee 524
TOTAL LIABILITIES 22,400
NET ASSETS $ 1,244,305
Net Assets consist of (Note 1):
Paid in capital $ 1,233,437
Accumulated undistributed net realized gain (loss) on (409)
investments
Net unrealized appreciation (depreciation) on investment 11,277
securities
NET ASSETS, for 124,429 shares outstanding $ 1,244,305
NET ASSET VALUE, offering price and redemption price per $10.00
share ($1,244,305 (divided by) 124,429 shares)
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
<S> <C> <C>
SIX MONTHS ENDED FEBRUARY 28, 1994 (UNAUDITED)
INTEREST INCOME $ 26,909
EXPENSES
Management fee (Note 4) $ 3,011
Non-interested trustees' compensation 3
Interest (Note 5) 1
Total expenses before reductions 3,015
Expense reductions (Note 6) (251) 2,764
NET INTEREST INCOME 24,145
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
(NOTES 1, 2 AND 3)
Net realized gain (loss) on:
Investment securities 1,763
Futures contracts (17) 1,746
Change in net unrealized appreciation (depreciation) on (11,893)
investment securities
NET GAIN (LOSS) (10,147)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM $ 13,998
OPERATIONS
</TABLE>
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
<S> <C> <C> <C>
AMOUNTS IN THOUSANDS SIX MONTHS YEAR ENDED
ENDED FEBRUARY EIGHT MONTHS DECEMBER 31,
28, ENDED AUGUST 1992
1994 31,
(UNAUDITED) 1993
INCREASE (DECREASE) IN NET ASSETS
Operations $ 24,145 $ 24,825 $ 22,481
Net interest income
Net realized gain (loss) on 1,746 3,827 (1,894)
investments
Change in net unrealized (11,893) 12,810 7,102
appreciation
(depreciation) on investments
NET INCREASE (DECREASE) IN NET 13,998 41,462 27,689
ASSETS RESULTING FROM
OPERATIONS
Distributions to shareholders (24,145) (24,825) (22,481)
From net interest income
From net realized gain (1,120) - -
TOTAL DISTRIBUTIONS (25,265) (24,825) (22,481)
Share transactions 746,438 678,560 718,466
Net proceeds from sales of shares
Reinvestment of distributions from: 21,065 21,754 19,486
Net interest income
Net realized gain 1,015 - -
Cost of shares redeemed (479,846) (408,742) (328,310)
Net increase (decrease) in net 288,672 291,572 409,642
assets resulting from share
transactions
TOTAL INCREASE (DECREASE) IN NET 277,405 308,209 414,850
ASSETS
NET ASSETS
Beginning of period 966,900 658,691 243,841
End of period $ 1,244,305 $ 966,900 $ 658,691
OTHER INFORMATION
Shares
Sold 73,973 67,756 73,150
Issued in reinvestment of 2,088 2,169 1,983
distributions
from:
Net interest income
Net realized gain 100 - -
Redeemed (47,535) (40,794) (33,404)
Net increase (decrease) 28,626 29,131 41,729
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C>
FINANCIAL HIGHLIGHTS SIX MONTHS EIGHT MONTHS YEARS ENDED DECEMBER 31,
ENDED ENDED
FEBRUARY 28, AUGUST 31,
1994
(UNAUDITED) 1993 1992 1991 1990 1989 1988
SELECTED PER-SHARE DATA
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning of period $ 10.090 $ 9.880 $ 9.780 $ 9.520 $ 9.490 $ 9.450 $ 9.510
Income from Investment
Operations .220 .303 .490 .559 .562 .536 .516
Net interest income
Net realized and unrealized
gain (loss) on investments (.080) .210 .100 .260 .030 .040 (.060)
Total from interest operations 140 .513 .590 .819 .592 .576 .456
Less Distributions (.220) (.303) (.490) (.559) (.562) (.536) (.516)
From net interest income
From net realized gain on investments (.010) - - - - - -
Total distributions (.230) (.303) (.490) (.559) (.562) (.536) (.516)
Net asset value, end of
period $ 10.000 $ 10.090 $ 9.880 $ 9.780 $ 9.520 $ 9.490 $ 9.450
TOTAL RETURN (dagger)
(double dagger) 1.39% 5.25% 6.18% 8.85% 6.42% 6.30% 4.89%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period
(000 omitted) $ 1,244 $ 967 $ 659 $ 244 $ 59 $ 58 $ 77
Ratio of expenses to
average net assets .50%* .55%* .55% .55% .60% .58% .35%
Ratio of expenses to
average net assets before
expense reductions .55%* .55%* .55% .75% .89% .87% .92%
Ratio of net interest
income to average net assets 4.41%* 4.55%* 4.95% 5.68% 5.90% 5.69% 5.48%
Portfolio turnover rate 36%* 56%* 28% 59% 75% 82% 96%
</TABLE>
* ANNUALIZED (dagger) TOTAL RETURNS DO NOT INCLUDE THE ACCOUNT CLOSEOUT FEE
AND FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED. (double dagger)
THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD THE ADVISOR NOT REIMBURSED
CERTAIN EXPENSES DURING THE PERIODS FOR WHICH THE FUND WAS UNDER
REIMBURSEMENT.
29
SEMIANNUAL REPORT
NOTES TO FINANCIAL STATEMENTS
For the period ended February 28, 1994 (Unaudited)
1. SIGNIFICANT ACCOUNTING
POLICIES.
Spartan Short-Intermediate Municipal Fund (the fund) is a fund of Fidelity
Union Street Trust and is authorized to issue an unlimited number of
shares. The trust is registered under the Investment Company Act of 1940,
as amended (the 1940 Act), as an open-end management investment company
organized as a Massachusetts business trust. The following summarizes the
significant accounting policies of the fund:
SECURITY VALUATION. Securities are valued based upon a computerized matrix
system and/or appraisals by a pricing service, both of which consider
market transactions and dealer-supplied valuations. Short-term securities
maturing within sixty days are valued either at amortized cost or original
cost plus accrued interest, both of which approximate current value.
Securities for which quotations are not readily available through the
pricing service are valued at their fair value as determined in good faith
under consistently applied procedures under the general supervision of the
Board of Trustees.
INCOME TAXES. As a qualified regulated investment company under Subchapter
M of the Internal Revenue Code, the fund is not subject to income taxes to
the extent that it distributes all of its taxable income for its fiscal
year. The schedule of investments includes information regarding income
taxes under the caption "Income Tax Information."
INTEREST INCOME. Interest income, which includes amortization of premium
and accretion of original issue discount, is accrued as earned.
EXPENSES. Most expenses of the trust can be directly attributed to a fund.
Expenses which cannot be directly attributed are apportioned between the
funds in the trust.
DISTRIBUTIONS TO SHAREHOLDERS. Distributions are declared daily and paid
monthly from net investment income. Distributions from realized gains, if
any, are recorded on the ex-dividend date.
Income and capital gain distributions are determined in accordance with
income tax regulations which may differ from generally accepted accounting
principles. These differences are primarily due to differing treatments for
futures transactions. The fund also utilized earnings and profits
distributed to shareholders on redemptions of shares as a part of the
dividends paid deduction for income tax purposes. Permanent book and tax
basis differences relating to shareholder distributions will result in
reclassifications to paid in capital.
SECURITY TRANSACTIONS. Security transactions are accounted for as of trade
date. Gains and losses on securities sold are determined on the basis of
identified cost.
2. OPERATING POLICIES.
DELAYED DELIVERY TRANSACTIONS. The fund may purchase or sell securities on
a when-issued or forward commitment basis. Payment and delivery may take
place a month or more after the date of the transaction. The price of the
underlying securities and the date when the securities will be delivered
and paid for are fixed at the time the transaction is negotiated. The fund
identifies securities as segregated in its custodial records.
FUTURES CONTRACTS AND OPTIONS. The fund may invest in futures contracts and
write options. These investments involve, to varying degrees, elements of
market risk and risks in excess of the amount recognized in the Statement
of Assets and Liabilities. The face or contract amounts reflect the extent
of the involvement the fund has in the particular classes of instruments.
Risks may be caused by an imperfect correlation between movements in the
price of the instruments and the price of the underlying securities and
interest rates. Risks also may arise if there is an illiquid secondary
market for the instruments, or due to the inability of counterparties to
perform.
Futures contracts are valued at the settlement price established each day
by the board of trade or exchange on which they are traded. Options traded
on an exchange are valued using the last sale price or, in the absence of a
sale, the last offering price. Options traded over-the-counter are valued
using dealer-supplied valuations.
3. PURCHASES AND SALES OF
INVESTMENTS.
Purchases and sales of securities, other
than short-term securities, aggregated $475,832,000 and $195,019,000,
respectively.
The market value of futures contracts opened and closed amounted to
$32,153,000 and $32,170,000, respectively.
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES.
MANAGEMENT FEE. As the fund's investment adviser, Fidelity Management &
Research Company (FMR) pays all expenses except the compensation of the
non-interested Trustees and certain exceptions such as interest, taxes,
brokerage commissions and extraordinary expenses. FMR receives a fee that
is computed daily at an annual rate of .55% of the fund's average net
assets.
FMR also bears the cost of providing shareholder services to the fund. For
the period, FMR or its affiliates collected certain transaction fees from
shareholders which aggregated $15,000.
DISTRIBUTION AND SERVICE PLAN. Pursuant to the Distribution and Service
Plan (the Plan), and in accordance with Rule 12b-1 of the 1940 Act, FMR or
the fund's distributor, Fidelity Distributors Corporation (FDC), an
affiliate of FMR, may use their resources to pay administrative and
promotional expenses related to the sale of the fund's shares. Subject to
the approval of the Board of Trustees, the Plan also authorizes payments to
third parties that assist in the sale of the
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES - CONTINUED
DISTRIBUTION AND SERVICE PLAN - CONTINUED
fund's shares or render shareholder support services. FMR or FDC has
informed the fund that no payments were made to third parties under the
Plan for the period.
5. BANK BORROWINGS.
The fund is permitted to have bank borrowings for temporary or emergency
purposes to fund shareholder redemptions. The fund has established
borrowing arrangements with certain banks. Under the most restrictive
arrangement, the fund must pledge to the bank securities having a market
value in excess of 220% of the total bank borrowings. The interest rate on
the borrowings is the bank's base rate, as revised from time to time. The
maximum loan and the average daily loan balance during the period for which
the loan was outstanding amounted to $6,800,000. The weighted average
interest rate was 3.63%.
6. EXPENSE REDUCTIONS.
Efective January 10, 1994, FMR voluntarily agreed to reimburse the fund's
operating expenses (excluding interest, taxes, brokerage commissions and
extraordinary expenses) above an annual rate of .40% of average net assets.
For the period, the reimbursement reduced the fund's expenses by $251,000
or .05% of average net assets under this arrangement.
TO CALL FIDELITY
FOR FUND INFORMATION AND QUOTES
The Fidelity Telephone Connection offers you special automated telephone
services for quotes and balances. The services are easy to use,
confidential and quick. All you need is a Touch Tone telephone.
YOUR PERSONAL IDENTIFICATION NUMBER
(PIN)
The first time you call one of our automated telephone services, we'll ask
you
to set up your Personal Identification
Number (PIN). The PIN assures that
only you have automated telephone
access to your account information.
Please have your Customer Number
(T-account #) handy when you call --
you'll need it to establish your PIN. If
you would ever like to change your PIN, just choose the "Change your
Personal
Identification Number" option when
you call. If you forget your PIN, please
call a Fidelity representative at 1-800-
544-6666 for assistance.
(PHONE_GRAPHIC)(PHONE_GRAPHIC)(PHONE_GRAPHIC)(PHONE_GRAPHIC)(PHONE_GRAPHIC
(PHONE_GRAPHIC)MUTUAL FUND QUOTES*
1-800-544-8544
Just make a selection from this record-ed menu:
PRESS
1. For quotes on funds you own.
2. For an individual fund quote.
3. For the ten most frequently
requested Fidelity fund quotes.
4. For quotes on Fidelity Select
Portfolios(Registered trademark).
5. To change your Personal
Identification Number (PIN).
6. To speak with a Fidelity
representative.
(PHONE_GRAPHIC)(PHONE_GRAPHIC)(PHONE_GRAPHIC)(PHONE_GRAPHIC)(PHONE_GRAPHIC
(PHONE_GRAPHIC)MUTUAL FUND ACCOUNT
BALANCES 1-800-544-7544
Just make a selection from this record-
ed menu:
PRESS
1. For balances on funds you own.
2. For your most recent fund activity
(purchases, redemptions, and
dividends).
3. To change your Personal
Identification Number (PIN).
4. To speak with a Fidelity
representative.
* WHEN YOU CALL THE QUOTES LINE, PLEASE REMEMBER THAT A FUND'S YIELD AND
RETURN WILL
VARY AND, EXCEPT FOR MONEY MARKET FUNDS, SHARE PRICE WILL ALSO VARY. THIS
MEANS THAT
YOU MAY HAVE A GAIN OR LOSS WHEN YOU SELL YOUR SHARES. THERE IS NO
ASSURANCE THAT
MONEY MARKET FUNDS WILL BE ABLE TO MAINTAIN A STABLE $1 SHARE PRICE; AN
INVESTMENT IN
A MONEY MARKET FUND IS NOT INSURED OR GUARANTEED BY THE U.S. GOVERNMENT.
TOTAL
RETURNS ARE HISTORICAL AND INCLUDE CHANGES IN SHARE PRICE, REINVESTMENT OF
DIVIDENDS
AND CAPITAL GAINS, AND THE EFFECTS OF ANY SALES CHARGES. FOR MORE
INFORMATION ON ANY
FIDELITY FUND INCLUDING MANAGEMENT FEES AND CHARGES, CALL 1-800-544-8888
FOR A FREE
PROSPECTUS. READ IT CAREFULLY BEFORE YOU INVEST OR SEND MONEY.
TO VISIT FIDELITY
For directions and hours,
please call 1-800-544-9797.
ARIZONA
7373 N. Scottsdale Road
Scottsdale, AZ
CALIFORNIA
851 Hamilton Avenue
Campbell, CA
527 North Brand Boulevard
Glendale, CA
19100 Von Karman Avenue
Irvine, CA
10100 Santa Monica Blvd.
Los Angeles, CA
811 Wilshire Boulevard
Los Angeles, CA
251 University Avenue
Palo Alto, CA
1760 Challenge Way
Sacramento, CA
7676 Hazard Center Drive
San Diego, CA
455 Market Street
San Francisco, CA
1400 Civic Drive
Walnut Creek, CA
COLORADO
1625 Broadway
Denver, CO
CONNECTICUT
185 Asylum Street
Hartford, CT
265 Church Street
New Haven, CT
300 Atlantic Street
Stamford, CT
DELAWARE
222 Delaware Avenue
Wilmington, DE
FLORIDA
4400 N. Federal Highway
Boca Raton, FL
2249 Galiano Street
Coral Gables, FL
4090 N. Ocean Boulevard
Ft. Lauderdale, FL
4001 Tamiami Trail, North
Naples, FL
32 West Central Boulevard
Orlando, FL
2401 PGA Boulevard
Palm Beach Gardens, FL
8065 Beneva Road
Sarasota, FL
2000 66th Street, North
St. Petersburg, FL
GEORGIA
3525 Piedmont Road, N.E.
Atlanta, GA
1000 Abernathy Road
Atlanta, GA
HAWAII
700 Bishop Street
Honolulu, HI
ILLINOIS
215 East Erie Street
Chicago, IL
One North Franklin
Chicago, IL
540 Lake Cook Road
Deerfield, IL
1415 West 22nd Street
Oak Brook, IL
1700 East Golf Road
Schaumburg, IL
LOUISIANA
201 St. Charles Avenue
New Orleans, LA
MAINE
3 Canal Plaza
Portland, ME
MARYLAND
1 West Pennsylvania Ave.
Towson, MD
7401 Wisconsin Avenue
Bethesda, MD
MASSACHUSETTS
470 Boylston Street
Boston, MA
21 Congress Street
Boston, MA
25 State Street
Boston, MA
300 Granite Street
Braintree, MA
101 Cambridge Street
Burlington, MA
416 Belmont Street
Worcester, MA
MICHIGAN
280 North Woodward Ave.
Birmingham, MI
26955 Northwestern Hwy.
Southfield, MI
MINNESOTA
38 South Sixth Street
Minneapolis, MN
MISSOURI
700 West 47th Street
Kansas City, MO
200 North Broadway
St. Louis, MO
NEW JERSEY
60B South Street
Morristown, NJ
501 Route 17, South
Paramus, NJ
505 Millburn Avenue
Short Hills, NJ
NEW YORK
1050 Franklin Avenue
Garden City, NY
999 Walt Whitman Road
Melville, L.I., NY
71 Broadway
New York, NY
350 Park Avenue
New York, NY
10 Bank Street
White Plains, NY
NORTH CAROLINA
2200 West Main Street
Durham, NC
OHIO
600 Vine Street
Cincinnati, OH
1903 East Ninth Street
Cleveland, OH
28699 Chagrin Boulevard
Woodmere Village, OH
OREGON
121 S.W. Morrison Street
Portland, OR
PENNSYLVANIA
1735 Market Street
Philadelphia, PA
439 Fifth Avenue
Pittsburgh, PA
TENNESSEE
5100 Poplar Avenue
Memphis, TN
TEXAS
10000 Research Boulevard
Austin, TX
7001 Preston Road
Dallas, TX
1155 Dairy Ashford
Houston, TX
1010 Lamar Street
Houston, TX
2701 Drexel Drive
Houston, TX
400 East Las Colinas Blvd.
Irving, TX
14100 San Pedro
San Antonio, TX
UTAH
175 East 400 South Street
Salt Lake City, UT
VERMONT
199 Main Street
Burlington, VT
VIRGINIA
8180 Greensboro Drive
McLean, VA
WASHINGTON
411 108th Avenue, N.E.
Bellevue, WA
1001 Fourth Avenue
Seattle, WA
WASHINGTON, DC
1775 K Street, N.W.
Washington, DC
WISCONSIN
222 East Wisconsin Avenue
Milwaukee, WI
TO WRITE FIDELITY
Please locate the address that is closest to you. We'll give your
correspondence immediate attention and send you written confirmation upon
completion of your request. Please send ALL correspondence about retirement
accounts to Dallas.
(LETTER_GRAPHIC)(LETTER_GRAPHIC)MAKING CHANGES
TO YOUR ACCOUNT
(such as changing name, address, bank, etc.)
Fidelity Investments
P.O. Box 2269
Boston, MA 02107-2269
Fidelity Investments
P.O. Box 660602
Dallas, TX 75266-0602
Fidelity Investments
P.O. Box 30280
Salt Lake City, UT 84130-0280
(LETTER_GRAPHIC)(LETTER_GRAPHIC)FOR NON-RETIREMENT
ACCOUNTS
BUYING SHARES
Fidelity Investments
Additional Payments
P.O. Box 2656
Boston, MA 02293-0656
Fidelity Investments
Additional Payments
P.O. Box 620024
Dallas, TX 75262-0024
Fidelity Investments
Additional Payments
P.O. Box 31455
Salt Lake City, UT 84131-0455
OVERNIGHT EXPRESS
Fidelity Investments
Additional Payments
World Trade Center
164 Northern Avenue
Boston, MA 02210
SELLING SHARES
Fidelity Investments
P.O. Box 193
Boston, MA 02103-0878
Fidelity Investments
P.O. Box 660602
Dallas, TX 75266-0602
Fidelity Investments
P.O. Box 30281
Salt Lake City, UT 84130-0281
OVERNIGHT EXPRESS
Fidelity Investments
Attn: Redemptions
World Trade Center
164 Northern Avenue
Boston, MA 02210
GENERAL CORRESPONDENCE
Fidelity Investments
P.O. Box 193
Boston, MA 02101-0193
Fidelity Investments
P.O. Box 660602
Dallas, TX 75266-0602
(LETTER_GRAPHIC)(LETTER_GRAPHIC)FOR RETIREMENT
ACCOUNTS
BUYING SHARES
Fidelity Investments
P.O. Box 620024
Dallas, TX 75262-0024
SELLING SHARES
Fidelity Investments
P.O. Box 660602
Dallas, TX 75266-0602
GENERAL CORRESPONDENCE
Fidelity Investments
P.O. Box 660602
Dallas, TX 75266-0602
INVESTMENT ADVISER
Fidelity Management & Research Company
Boston, MA
OFFICERS
Edward C. Johnson 3d, President
J. Gary Burkhead, Senior Vice President
David Murphy, Vice President
Gary L. French, Treasurer
John H. Costello, Assistant Treasurer
Arthur S. Loring, Secretary
BOARD OF TRUSTEES
J. Gary Burkhead
Ralph F. Cox *
Phyllis Burke Davis *
Richard J. Flynn *
Edward C. Johnson 3d
E. Bradley Jones *
Donald J. Kirk *
Peter S. Lynch
Edward H. Malone *
Gerald C. McDonough *
Thomas R. Williams *
GENERAL DISTRIBUTOR
Fidelity Distributors Corporation
Boston, MA
TRANSFER AND SHAREHOLDER
SERVICING AGENT
United Missouri Bank, N.A.
Kansas City, MO
and
Fidelity Service Co.
Boston, MA
CUSTODIAN
United Missouri Bank, N.A.
Kansas City, MO
Corporate Headquarters
82 Devonshire St., Boston, MA 02109
FIDELITY TAX-FREE BOND FUNDS
Aggressive Tax-Free
California Tax-Free High Yield
California Tax-Free Insured
High Yield Tax-Free
Insured Tax-Free
Limited Term Municipals
Massachusetts Tax-Free High Yield
Michigan Tax-Free High Yield
Minnesota Tax-Free
Municipal Bond
New York Tax-Free High Yield
New York Tax-Free Insured
Ohio Tax-Free High Yield
Spartan Aggressive Municipal
Spartan California Intermediate Municipal
Spartan California Municipal High Yield
Spartan Connecticut Municipal High Yield
Spartan Florida Municipal Income
Spartan Intermediate Municipal
Spartan Maryland Municipal Income
Spartan Municipal Income
Spartan New Jersey Municipal High Yield
Spartan New York Intermediate Municipal
Spartan New York Municipal High Yield
Spartan Pennsylvania Municipal High Yield
Spartan Short-Intermediate Municipal
THE FIDELITY TELEPHONE CONNECTION
MUTUAL FUND 24-HOUR SERVICE
Account Balances 1-800-544-7544
Exchanges/Redemptions 1-800-544-7777
Mutual Fund Quotes 1-800-544-8544
Account Assistance 1-800-544-6666
Product Information 1-800-544-8888
Retirement Accounts 1-800-544-4774
(8 a.m. - 9 p.m.)
TDD Service 1-800-544-0118
for the deaf and hearing impaired
(9 a.m. - 9 p.m. Eastern time)
* INDEPENDENT TRUSTEES
AUTOMATED LINES FOR QUICKEST SERVICE
