SPARTAN(registered trademark)
(REGISTERED TRADEMARK)
MASSACHUSETTS MUNICIPAL
FUNDS
AND
FIDELITY
MASSACHUSETTS MUNICIPAL
MONEY MARKET FUND
ANNUAL REPORT
JANUARY 31, 1998
CONTENTS
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PRESIDENT'S MESSAGE 3 NED JOHNSON ON INVESTING STRATEGIES
SPARTAN MASSACHUSETTS MUNICIPAL INCOME FUND
4 PERFORMANCE
7 FUND TALK: THE MANAGER'S OVERVIEW
10 INVESTMENT CHANGES
11 INVESTMENTS
22 FINANCIAL STATEMENTS
FIDELITY MASSACHUSETTS MUNICIPAL MONEY MARKET FUND
26 PERFORMANCE
28 FUND TALK: THE MANAGER'S OVERVIEW
30 INVESTMENT CHANGES
31 INVESTMENTS
40 FINANCIAL STATEMENTS
SPARTAN MASSACHUSETTS MUNICIPAL MONEY MARKET FUND
44 PERFORMANCE
46 FUND TALK: THE MANAGER'S OVERVIEW
48 INVESTMENT CHANGES
49 INVESTMENTS
57 FINANCIAL STATEMENTS
NOTES 61 NOTES TO THE FINANCIAL STATEMENTS
REPORT OF INDEPENDENT 65 THE AUDITORS' OPINION.
ACCOUNTANTS
DISTRIBUTIONS 66
</TABLE>
To reduce expenses and demonstrate respect for our environment, we
have initiated a project through which we will begin eliminating
duplicate copies of most financial reports and prospectuses to most
households, even if they have more than one account in the fund. If
additional copies of financial reports, prospectuses or historical
account information are needed, please call 1-800-544-6666.
THIS REPORT AND THE FINANCIAL STATEMENTS CONTAINED HEREIN ARE
SUBMITTED FOR THE GENERAL
INFORMATION OF THE SHAREHOLDERS OF THE FUNDS. THIS REPORT IS NOT
AUTHORIZED FOR DISTRIBUTION TO
PROSPECTIVE INVESTORS IN THE FUNDS UNLESS PRECEDED OR ACCOMPANIED BY
AN EFFECTIVE PROSPECTUS.
MUTUAL FUND SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR
GUARANTEED BY, ANY DEPOSITORY INSTITUTION. SHARES ARE NOT INSURED BY
THE FDIC, FEDERAL RESERVE BOARD OR ANY OTHER AGENCY, AND ARE
SUBJECT TO INVESTMENT RISKS, INCLUDING POSSIBLE LOSS OF PRINCIPAL
AMOUNT INVESTED.
NEITHER THE FUNDS NOR FIDELITY DISTRIBUTORS CORPORATION IS A BANK.
FOR MORE INFORMATION ON ANY FIDELITY FUND, INCLUDING CHARGES AND
EXPENSES, CALL 1-800-544-8888
FOR A FREE PROSPECTUS. READ IT CAREFULLY BEFORE YOU INVEST OR SEND
MONEY.
PRESIDENT'S MESSAGE
(PHOTO_OF_EDWARD_C_JOHNSON_3D)DEAR SHAREHOLDER:
As we entered 1998, the pesky economic and currency crises in
Southeast Asia were still very much with us. Adding to these concerns
was the possibility that U.S. corporate earnings might decline in the
face of lower global product demand. But the news wasn't all bad as
low inflation, low interest rates and moderate economic growth
continued to prevail. The bond market performed well, as it benefited
from the favorable economic backdrop and a "flight-to-safety"
mentality on the part of stock investors.
While it's impossible to predict the future direction of the markets
with any degree of certainty, there are certain basic principles that
can help investors plan for their future needs.
The longer your investment time frame, the less likely it is that you
will be affected by short-term market volatility. A 10-year investment
horizon appropriate for saving for a college education, for example,
enables you to weather market cycles in a long-term fund, which may
have a higher risk potential, but also has a higher potential rate of
return.
An intermediate-length fund could make sense if your investment
horizon is two to four years, while a short-term bond fund could be
the right choice if you need your money in one or two years.
If your time horizon is less than a year, you might want to consider
moving some of your bond investment into a money market fund. These
funds seek income and a stable share price by investing in
high-quality, short-term investments. Of course, it's important to
remember that there is no assurance that a money market fund will
achieve its goal of maintaining a stable net asset value of $1.00 per
share, and that these types of funds are neither insured nor
guaranteed by any agency of the U.S. government.
Finally, no matter what your time horizon or portfolio diversity, it
makes good sense to follow a regular investment plan, investing a
certain amount of money in a fund at the same time each month or
quarter and periodically reviewing your overall portfolio. By doing
so, you won't get caught up in the excitement of a rapidly rising
market, nor will you buy all your shares at market highs. While this
strategy - known as dollar cost averaging - won't assure a profit or
protect you from a loss in a declining market, it should help you
lower the average cost of your purchases.
If you have questions, please call us at 1-800-544-8888. We are
available 24 hours a day, seven days a week to provide you the
information you need to make the investments that are right for you.
Best regards,
Edward C. Johnson 3d
SPARTAN MASSACHUSETTS MUNICIPAL INCOME FUND
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. Total return reflects the change in the value of an
investment, assuming reinvestment of the fund's dividend income and
capital gains (the profits earned upon the sale of securities that
have grown in value). You can also look at the fund's income, as
reflected in its yield, to measure performance.
CUMULATIVE TOTAL RETURNS
PERIODS ENDED JANUARY 31, 1998 PAST 1 PAST 5 PAST 10
YEAR YEARS YEARS
SPARTAN MA MUNI INCOME 10.21% 41.17% 119.33%
LB MASSACHUSETTS ENHANCED 10.10% N/A N/A
MUNICIPAL BOND
MASSACHUSETTS MUNICIPAL DEBT FUNDS AVERAGE 9.55% 38.22% 111.51%
CUMULATIVE TOTAL RETURNS show the fund's performance in percentage
terms over a set period - in this case, one year, five years or 10
years. For example, if you had invested $1,000 in a fund that had a 5%
return over the past year, the value of your investment would be
$1,050. You can compare the fund's returns to the performance of the
Lehman Brothers Massachusetts Enhanced Municipal Bond Index, - a total
return performance benchmark for Massachusetts investment-grade
municipal bonds with maturities of at least one year. To measure how
the fund's performance stacked up against its peers, you can compare
it to the Massachusetts municipal debt funds average, which reflects
the performance of mutual funds with similar objectives tracked by
Lipper Analytical Services, Inc. The past one year average represents
a peer group of 54 mutual funds. These benchmarks include reinvested
dividends and capital gains, if any, and exclude the effect of sales
charges.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED JANUARY 31, 1998 PAST 1 PAST 5 PAST 10
YEAR YEARS YEARS
SPARTAN MA MUNI INCOME 10.21% 7.14% 8.17%
LB MASSACHUSETTS ENHANCED 10.10% N/A N/A
MUNICIPAL BOND
MASSACHUSETTS MUNICIPAL DEBT FUNDS AVERAGE 9.55% 6.69% 7.77%
AVERAGE ANNUAL TOTAL RETURNS take the fund's cumulative return and
show you what would have happened if the fund had performed at a
constant rate each year. (Note: Lipper calculates average annual total
returns by annualizing each fund's total return, then taking the
arithmetic average. This may produce a slightly different figure than
that obtained by averaging the cumulative total returns and
annualizing the result.)
$10,000 OVER 10 YEARS
IMAHDR PRASUN SHR__CHT 19980131 19980209 151628 S00000000000001
Spartan MA Muni Income LB Municipal Bond
00070 LB015
1988/01/31 10000.00 10000.00
1988/02/29 10114.93 10105.70
1988/03/31 9938.40 9988.47
1988/04/30 10019.38 10064.39
1988/05/31 10072.96 10035.30
1988/06/30 10181.82 10182.12
1988/07/31 10253.86 10248.50
1988/08/31 10289.09 10257.52
1988/09/30 10438.87 10443.18
1988/10/31 10627.45 10626.98
1988/11/30 10566.16 10529.64
1988/12/31 10729.21 10637.36
1989/01/31 10882.78 10857.34
1989/02/28 10811.49 10733.46
1989/03/31 10819.33 10707.80
1989/04/30 11085.13 10962.01
1989/05/31 11282.42 11189.69
1989/06/30 11378.68 11341.64
1989/07/31 11465.97 11496.00
1989/08/31 11421.50 11383.46
1989/09/30 11377.81 11349.54
1989/10/31 11485.60 11488.34
1989/11/30 11648.28 11689.39
1989/12/31 11721.31 11785.01
1990/01/31 11663.87 11729.26
1990/02/28 11808.29 11833.65
1990/03/31 11828.55 11837.20
1990/04/30 11673.24 11751.50
1990/05/31 11927.19 12008.04
1990/06/30 12052.17 12113.59
1990/07/31 12222.51 12291.66
1990/08/31 12075.89 12113.18
1990/09/30 12116.33 12120.09
1990/10/31 12157.70 12339.95
1990/11/30 12533.41 12588.10
1990/12/31 12586.85 12642.86
1991/01/31 12742.38 12812.53
1991/02/28 12840.12 12924.00
1991/03/31 12904.08 12928.65
1991/04/30 13082.94 13100.60
1991/05/31 13214.73 13217.06
1991/06/30 13240.83 13203.98
1991/07/31 13432.69 13364.80
1991/08/31 13555.07 13540.82
1991/09/30 13679.67 13717.12
1991/10/31 13801.61 13840.57
1991/11/30 13838.16 13879.19
1991/12/31 14009.86 14177.04
1992/01/31 14131.74 14209.36
1992/02/29 14176.77 14213.91
1992/03/31 14190.75 14219.17
1992/04/30 14316.78 14345.72
1992/05/31 14473.04 14514.57
1992/06/30 14713.72 14758.12
1992/07/31 15109.34 15200.57
1992/08/31 14919.25 15052.36
1992/09/30 15046.27 15150.81
1992/10/31 14792.08 15001.87
1992/11/30 15166.48 15270.56
1992/12/31 15311.18 15426.47
1993/01/31 15536.30 15605.88
1993/02/28 16070.81 16170.34
1993/03/31 15925.44 15999.42
1993/04/30 16071.78 16160.86
1993/05/31 16180.79 16251.68
1993/06/30 16435.71 16522.92
1993/07/31 16424.24 16544.57
1993/08/31 16766.96 16889.02
1993/09/30 17053.35 17081.39
1993/10/31 17095.26 17114.36
1993/11/30 16954.81 16963.58
1993/12/31 17289.53 17321.68
1994/01/31 17489.33 17519.50
1994/02/28 17123.36 17065.74
1994/03/31 16386.49 16370.82
1994/04/30 16441.71 16509.65
1994/05/31 16603.58 16652.79
1994/06/30 16526.26 16551.04
1994/07/31 16838.59 16854.42
1994/08/31 16912.70 16912.73
1994/09/30 16637.43 16664.46
1994/10/31 16302.50 16368.50
1994/11/30 15842.42 16072.55
1994/12/31 16239.44 16426.31
1995/01/31 16826.41 16895.77
1995/02/28 17297.78 17387.10
1995/03/31 17529.57 17586.88
1995/04/30 17538.08 17607.63
1995/05/31 18086.89 18169.49
1995/06/30 17807.90 18011.42
1995/07/31 17928.45 18182.17
1995/08/31 18146.24 18412.72
1995/09/30 18296.91 18529.27
1995/10/31 18595.31 18798.68
1995/11/30 18922.12 19110.55
1995/12/31 19174.12 19294.21
1996/01/31 19309.87 19439.88
1996/02/29 19108.89 19308.66
1996/03/31 18847.84 19061.89
1996/04/30 18764.99 19007.95
1996/05/31 18768.03 19000.35
1996/06/30 18952.38 19207.26
1996/07/31 19156.13 19382.05
1996/08/31 19123.68 19377.39
1996/09/30 19378.40 19648.68
1996/10/31 19601.39 19870.90
1996/11/30 19960.52 20234.54
1996/12/31 19863.86 20149.56
1997/01/31 19901.07 20187.64
1997/02/28 20086.33 20372.96
1997/03/31 19809.02 20101.39
1997/04/30 19983.59 20269.64
1997/05/31 20285.31 20574.49
1997/06/30 20496.57 20793.61
1997/07/31 21084.36 21369.60
1997/08/31 20887.99 21169.36
1997/09/30 21136.25 21420.64
1997/10/31 21262.60 21558.38
1997/11/30 21403.66 21685.14
1997/12/31 21714.94 22001.53
1998/01/30 21933.03 22228.58
IMATRL PRASUN SHR__CHT 19980131 19980209 151632 R00000000000123
$10,000 OVER 10 YEARS: Let's say hypothetically that $10,000 was
invested in Spartan Massachusetts Municipal Income Fund on January 31,
1988. As the chart shows, by January 31, 1998, the value of the
investment would have grown to $21,933 - a 119.33% increase on the
initial investment. For comparison, look at how the Lehman Brothers
Municipal Bond Index - which reflects the performance of the
investment-grade municipal bond market - did over the same period.
With dividends and capital gains, if any, reinvested, the same $10,000
would have grown to $22,229 - a 122.29% increase.
UNDERSTANDING
PERFORMANCE
HOW A FUND DID YESTERDAY IS
NO GUARANTEE OF HOW IT WILL DO
TOMORROW. BOND PRICES, FOR
EXAMPLE, GENERALLY 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)
TOTAL RETURN COMPONENTS
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YEARS ENDED JANUARY 31,
1998 1997 1996 1995 1994
DIVIDEND RETURN 5.47% 5.33% 6.41% 5.85% 6.32%
CAPITAL APPRECIATION RETURN 4.74% -2.27% 8.35% -9.64% 6.25%
TOTAL RETURN 10.21% 3.06% 14.76% -3.79% 12.57%
</TABLE>
TOTAL RETURN COMPONENTS include both dividend returns and capital
appreciation returns. A dividend return reflects the actual dividends
paid by the fund. A capital appreciation return reflects both the
amount paid by the fund to shareholders as capital gain distributions
and changes in the fund's share price. Both returns assume the
dividends or capital gains paid by the fund are reinvested, if any.
DIVIDENDS AND YIELD
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PERIODS ENDED JANUARY 31, 1998 PAST 1 PAST 6 PAST 1
MONTH MONTHS YEAR
DIVIDENDS PER SHARE 4.95(CENTS) 29.53(CENTS) 59.32(CENTS)
ANNUALIZED DIVIDEND RATE 4.87% 4.98% 5.10%
30-DAY ANNUALIZED YIELD 4.17% - -
30-DAY ANNUALIZED TAX-EQUIVALENT YIELD 7.40% - -
</TABLE>
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
$11.97 over the past one month, $11.77 over the past six months and
$11.62 over the past one year, you can compare the fund's income over
these three periods. Dividends per share show the income paid by the
fund for a set period and do not reflect any tax reclassifications.
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 43.68% combined 1997 federal
and state tax bracket, but does not reflect the payment of the
alternative minimum tax, if applicable.
SPARTAN MASSACHUSETTS MUNICIPAL INCOME FUND
FUND TALK: THE MANAGER'S OVERVIEW
MARKET RECAP
With investor sentiment, shifting
supply/demand conditions and
Federal Reserve Board policymaking
playing integral roles, municipal
bonds performed quite well for the
12 months that ended January 31,
1998. During this period, the
Lehman Brothers Municipal Bond
Index - a measure of the municipal
bond market - returned 10.11%.
To compare, the Lehman Brothers
Aggregate Bond Index - a measure
of the investment-grade taxable
bond market in the U.S. -
returned 10.72%. Through much
of the first half of 1997, low supply
and high demand helped boost muni
bond prices. One notable hiccup
came in March, when the Fed
raised a key short-term interest
rate to try to stave off inflation.
Although investors anticipated this
move, the market nonetheless
reacted negatively. From April
through mid- September,
encouraging economic data -
coupled with the Fed's reluctance
to raise rates further - tempered
concerns. The supply of muni
bonds increased in the second half of
1997 while demand varied, leading
to mixed performance. However,
volatility in Asia toward the end of
the period helped prop up the muni
bond market, because investors
felt that currency devaluations in
that region would translate into
cheaper prices for Asian goods
and help control the inflation that
can eat into bonds' fixed payments.
In January 1998, muni bond supply
increased as many issuers took
advantage of lower interest rates to
refinance their debt at lower rates.
Nevertheless, a positive inflation
outlook helped sustain the muni
market.
An interview with Jonathan Short, Portfolio Manager of Spartan
Massachusetts Municipal Income Fund
Q. HOW DID THE FUND PERFORM, JON?
A. The fund did fairly well, outpacing both its competitors and its
benchmark during the past year. For the 12-month period that ended
January 31, 1998, the fund had a total return of 10.21%. To get a
sense of how the fund did relative to its competitors, the
Massachusetts municipal debt funds average returned 9.55% for the same
12-month period, according to Lipper Analytical Services.
Additionally, the Lehman Brothers Massachusetts Enhanced Municipal
Bond Index - a broad measure of performance of the state's municipal
bond market - returned 10.10% for the same one-year period.
Q. WHY DID THE FUND PERFORM BETTER THAN THE AVERAGE AND ITS BENCHMARK
INDEX?
A. One reason was the fund's rather large stake in non-callable bonds
- - which can't be redeemed by their issuers before maturity. These
bonds performed well throughout the entire year, coming on
particularly strong in the final six months of 1997. When rates fall,
as they did in the final half of the year, municipal bond issuers
often refinance their older, more expensive debt at lower interest
rates, much in the same way that homeowners do with their mortgages.
When a bond is called or redeemed by its issuer, a bond holder often
is forced to reinvest the proceeds in bonds offering current lower
interest rates. Because interest rates were on the decline, investors
sought out non-callable bonds, creating increased demand for them and,
as a result, helping them outpace callable bonds.
Q. WHAT OTHER HOLDINGS CONTRIBUTED TO THE FUND'S PERFORMANCE?
A. A wave of consolidation among Massachusetts health care
organizations provided a strong underpinning for the performance of
bonds issued by tax-exempt health care entities - which made up 21.1%
of the fund's investments at the end of the period. As consolidation
activity quickened, the prices of many health care bonds rose in
response. A good example is the fund's holdings in bonds issued for
the Massachusetts Biomedical Research Corp. These bonds were boosted
when investors became better-informed about the facility's financial
performance.
Q. WHICH HOLDINGS DETRACTED FROM THE FUND'S PERFORMANCE?
A. Housing bonds didn't perform particularly well during the period
and modestly detracted from the fund's performance. These bonds are
subject to prepayment risk, the risk that the mortgages that make up
these securities will be prepaid by mortgage holders and the holders
of the bonds will be forced to reinvest at lower interest rates. When
interest rates fell, the level of prepayment activity increased and
put pressure on the prices of many housing bonds.
Q. WHAT WERE SOME OF YOUR OTHER KEY STRATEGIES DURING THE YEAR?
A. I continued to keep the fund's duration - which measures how
sensitive it is to changes in interest rates - in line with the
Massachusetts municipal market as a whole, as reflected by the Lehman
Brothers Massachusetts Enhanced Municipal Bond Index. As a rule, I
don't lengthen or shorten duration based on where I think interest
rates will be at some point in time because I believe it's extremely
difficult to do with any accuracy over an extended period of time. I
would rather focus my time on finding bonds that offer relatively
attractive values.
Q. WHAT'S YOUR OUTLOOK?
A. There are some factors related to municipal bond supply and demand
that I view as positives. Specifically, I expect the supply of
municipals to remain at roughly the same level we saw in 1997,
although it may be somewhat larger due to issuers refinancing their
older debt at today's lower interest rates. The demand for municipal
bonds has been relatively stable and has easily digested the increase
in supply that came from refinancings. What will drive demand for
municipals in 1998 is how attractive they are relative to other
fixed-income choices and particularly to stocks. A meaningful decline
in stock prices could ignite increased demand for municipals.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO
MANAGER ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON
THE COVER. THE MANAGER'S VIEWS ARE SUBJECT TO CHANGE AT ANY TIME BASED
ON MARKET AND OTHER CONDITIONS.
JONATHAN SHORT ON THE
MASSACHUSETTS ECONOMY,
FISCAL SITUATION AND GENERAL
OBLIGATION BONDS:
"The Massachusetts economy
currently is quite strong, evidenced
by extremely low unemployment
and rising home prices, among
other things. Because of this
continued economic strength,
the state's tax revenues have been
coming in well ahead of budget for
a number of years. In recognition of
its improved fiscal and economic
status, Massachusetts' credit rating
was upgraded in October to AA- by
Standard & Poor's."
(solid bullet) General obligation bonds
(GOs) made up the fund's largest
sector concentration at 26.5% of
investments at the end of the
period. A GO is backed by the full
faith and credit - which includes
the taxing power - of a city,
county, state or other issuer, and is
repaid with general revenue
including taxes. Rising incomes
and corporate profits boosted tax
collections, adding to the state's
coffers and generally boosting state
GO prices.
FUND FACTS
GOAL: to provide high current
income exempt from federal
income tax and Massachusetts
personal income taxes by
investing in investment-grade
municipal securities under
normal conditions
FUND NUMBER: 070
TRADING SYMBOL: FDMMX
START DATE: November 10, 1983
SIZE: as of January 31, 1998,
more than $1.2 billion
MANAGER: Jonathan Short,
since 1997; manager, various
Fidelity and Spartan municipal
income funds; joined Fidelity
in 1990
(checkmark)
SPARTAN MASSACHUSETTS MUNICIPAL INCOME FUND
INVESTMENT CHANGES
TOP FIVE SECTORS AS OF JANUARY 31, 1998
% OF FUND'S % OF FUND'S INVESTMENTS
INVESTMENTS IN THESE SECTORS
6 MONTHS AGO
GENERAL OBLIGATION 26.5 27.9
HEALTH CARE 21.1 21.1
WATER & SEWER 11.7 13.0
EDUCATION 9.4 9.9
ESCROWED/PRE-REFUNDED 7.5 4.8
AVERAGE YEARS TO MATURITY AS OF JANUARY 31, 1998
6 MONTHS AGO
YEARS 13.7 14.3
AVERAGE YEARS TO MATURITY IS BASED ON THE AVERAGE TIME UNTIL PRINCIPAL
PAYMENTS ARE EXPECTED FROM EACH OF THE FUND'S BONDS, WEIGHTED BY
DOLLAR AMOUNT.
DURATION AS OF JANUARY 31, 1998
6 MONTHS AGO
YEARS 6.8 6.7
DURATION SHOWS HOW MUCH A BOND FUND'S PRICE FLUCTUATES WITH CHANGES IN
COMPARABLE INTEREST RATES. IF RATES RISE 1%, FOR EXAMPLE, A FUND WITH
A FIVE-YEAR DURATION IS LIKELY TO LOSE ABOUT 5% OF ITS VALUE. OTHER
FACTORS ALSO CAN INFLUENCE A BOND FUND'S PERFORMANCE AND SHARE PRICE.
ACCORDINGLY, A BOND FUND'S ACTUAL PERFORMANCE MAY DIFFER FROM THIS
EXAMPLE.
QUALITY DIVERSIFICATION (MOODY'S RATINGS)
AS OF JANUARY 31, 1998 AS OF JULY 31, 1997
AAA 41.9%
AA, A 43.3%
BAA 5.9%
NON-RATED 5.8%
SHORT-TERM
INVESTMENTS 3.1%
AAA 36.6%
AA, A 49.2%
BAA 8.7%
NON-RATED 3.3%
SHORT-TERM
INVESTMENTS 2.2%
ROW: 1, COL: 1, VALUE: 3.1
ROW: 1, COL: 2, VALUE: 5.8
ROW: 1, COL: 3, VALUE: 5.9
ROW: 1, COL: 4, VALUE: 43.3
ROW: 1, COL: 5, VALUE: 41.9
ROW: 1, COL: 1, VALUE: 2.2
ROW: 1, COL: 2, VALUE: 3.3
ROW: 1, COL: 3, VALUE: 8.699999999999999
ROW: 1, COL: 4, VALUE: 49.2
ROW: 1, COL: 5, VALUE: 36.6
WHERE MOODY'S RATINGS ARE NOT AVAILABLE, WE HAVE USED S&P RATINGS.
AMOUNTS SHOWN ARE AS A PERCENTAGE OF THE FUND'S INVESTMENTS.
SPARTAN MASSACHUSETTS MUNICIPAL INCOME FUND
INVESTMENTS JANUARY 31, 1998
SHOWING PERCENTAGE OF TOTAL VALUE OF INVESTMENT IN SECURITIES
MUNICIPAL BONDS - 96.9%
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (A) AMOUNT (NOTE 1)
MASSACHUSETTS - 94.8%
Attleboro Gen. Oblig.:
6% 10/1/03 (MBIA Insured) Aaa $ 1,085,000 $ 1,188,455
6% 10/1/04 (MBIA Insured) Aaa 1,085,000 1,197,970
6% 10/1/05 (MBIA Insured) Aaa 1,085,000 1,208,831
6% 10/1/06 (MBIA Insured) Aaa 1,085,000 1,219,920
6% 10/1/07 (MBIA Insured) Aaa 1,085,000 1,225,356
Barnstable Ind. Dev. Fing. Auth. Ind. Dev. Rev.
(Whitehall Pavilion Health Proj.) 10.125%
2/15/26 (FHA Guaranteed) A 2,980,000 3,030,302
Boston Econ. Dev. & Ind. Corp.
(Boston Army Base 1983 Proj.) 6.25% 8/1/03,
LOC State Street Bank & Trust Co. A 4,310,000 4,357,410
Boston Gen. Oblig. Series A, 10% 7/1/00
(MBIA Insured) Aaa 1,000,000 1,137,120
Boston Hsg. Dev. Corp. Mtg. Rev. Rfdg.
(Section 8) Series A, 5.15% 7/1/08
(MBIA Insured) (FHA Guaranteed) Aaa 3,080,000 3,166,918
Boston Ind. Dev. Rev. (North End Commty. Nursing
Home) 11.45% 3/15/25 (FHA Guaranteed)
(Pre-Refunded to 3/15/98 @ 109) (d) AA 4,795,000 5,248,895
Boston Wtr. & Swr. Commission Rev. Gen. Sr.
Series A, 5.25% 11/1/19 A2 10,100,000 10,611,666
Brockton Hsg. Dev. Corp. Multi-Family Hsg. Rev.
Rfdg. (Douglas House Proj.) Series 1992-A,
7.375% 9/1/24 (Fannie Mae Coll.) Aaa 8,120,000 8,613,452
Chelsea School Proj. Loan Act 1948:
6.50% 6/15/12 (AMBAC Insured) Aaa 2,500,000 2,808,375
6% 6/15/14 (AMBAC Insured) Aaa 1,830,000 1,987,526
Granville Gen. Oblig.:
7.30% 7/15/05 (MBIA Insured) Aaa 145,000 173,817
7.30% 7/15/06 (MBIA Insured) Aaa 145,000 176,733
7.30% 7/15/07 (MBIA Insured) Aaa 140,000 172,637
7.30% 7/15/08 (MBIA Insured) Aaa 140,000 174,600
Halifax Gen. Oblig.:
6.20% 6/1/10 (AMBAC Insured) Aaa 325,000 362,453
6.25% 6/1/11 (AMBAC Insured) Aaa 325,000 362,385
6.30% 6/1/12 (AMBAC Insured) Aaa 325,000 363,275
6.30% 6/1/13 (AMBAC Insured) Aaa 325,000 362,892
Haverhill Gen. Oblig. Rfdg. Series A:
6.40% 9/1/03 (AMBAC Insured) Aaa 1,600,000 1,748,832
6.50% 9/1/04 (AMBAC Insured) Aaa 1,595,000 1,745,823
Holyoke Gen. Oblig.:
Series A:
5.50% 6/15/04 (FSA Insured) Aaa 1,255,000 1,340,026
6% 6/15/05 (FSA Insured) Aaa 1,350,000 1,491,777
6% 6/15/06 (FSA Insured) Aaa 1,300,000 1,447,342
5.50% 6/15/16 (FSA Insured) Aaa 2,100,000 2,196,852
Series B:
5.50% 6/15/04 (FSA Insured) Aaa 2,015,000 2,151,516
6% 6/15/06 (FSA Insured) Aaa 1,400,000 1,558,676
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (A) AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Holyoke School Proj. Loan Act:
7.35% 8/1/02 (Pre-Refunded to
8/1/01 @ 102) (d) Baa2 $ 1,960,000 $ 2,202,687
7.65% 8/1/09 (Pre-Refunded to
8/1/01 @ 102) (d) Baa2 2,205,000 2,499,367
Lowell Gen. Oblig.:
Rfdg. Series A, 5.50% 1/15/10 (FSA Insured) Aaa 2,000,000
2,114,760
Ltd. Tax:
8% 1/15/00 Baa1 500,000 520,540
6.25% 8/1/04 (AMBAC Insured) Aaa 2,035,000 2,272,240
6.25% 8/1/05 (AMBAC Insured) Aaa 2,120,000 2,385,509
5.80% 4/1/08 (FSA Insured) Aaa 1,195,000 1,308,836
8.40% 1/15/09 (Pre-Refunded to
1/15/01 @ 102) (d) Baa1 1,250,000 1,418,800
Lowell Hsg. Dev. Corp. Multi-Family Rev.
Rfdg. Series A:
7.875% 11/1/00 (Fannie Mae Coll.) Aaa 400,000 419,064
7.875% 11/1/24 (Fannie Mae Coll.) Aaa 5,440,000 5,769,066
Mansfield Gen. Oblig. Multi-Purpose Loan:
5.50% 8/15/08 (FGIC Insured) Aaa 2,075,000 2,252,060
5.50% 8/15/09 (FGIC Insured) Aaa 2,120,000 2,283,749
5.50% 8/15/10 (FGIC Insured) Aaa 2,170,000 2,320,229
Massachusetts Bay Trans. Auth.:
Rfdg. (Gen. Trans. Sys.):
Series A:
5.50% 3/1/04 (FGIC Insured) Aaa 2,000,000 2,143,320
7% 3/1/08 A1 1,000,000 1,206,650
5.50% 3/1/12 A1 4,350,000 4,732,582
6.25% 3/1/12 A1 1,500,000 1,738,845
Series B:
6.20% 3/1/16 A1 27,500,000 32,155,200
5.50% 3/1/21 A1 5,000,000 5,104,350
(Gen. Trans. Sys.):
Series A:
6.25% 3/1/05 A1 2,780,000 3,123,914
5.70% 3/1/09 A1 5,000,000 5,535,400
5.80% 3/1/11 A1 6,435,000 7,233,133
6% 3/1/11 (FGIC Insured) Aaa 5,660,000 6,272,638
5.80% 3/1/12 A1 3,000,000 3,356,160
6% 3/1/12 A1 7,440,000 8,050,378
7% 3/1/21 A1 1,500,000 1,920,690
Series B, 5.375% 3/1/25 (AMBAC Insured) Aaa 4,490,000 4,592,641
Series C, 5% 3/1/24 A1 2,500,000 2,436,275
Series D, 5% 3/1/22 A1 5,750,000 5,608,780
Massachusetts College Bldg. Auth. Proj. Rev. Rfdg.
Series A, 7.50% 5/1/05 A1 3,000,000 3,610,710
Massachusetts Ed. Loan Auth.
Ed. Loan Rev. Issue E:
5.75% 7/1/07 (AMBAC Insured) (c) Aaa 3,365,000 3,626,797
5.85% 7/1/08 (AMBAC Insured) (c) Aaa 5,000,000 5,375,450
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (A) AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Massachusetts Gen. Oblig.:
Rfdg. Series A:
6.25% 7/1/02 A1 $ 18,565,000 $ 20,158,991
6.25% 7/1/03 A1 18,500,000 20,369,055
6.25% 7/1/04 A1 9,300,000 10,354,899
6% 7/1/05 (AMBAC Insured) Aaa 4,000,000 4,454,520
5.25% 2/1/08 A1 5,000,000 5,219,550
Rfdg. Series B:
5.40% 11/1/06 A1 3,750,000 4,040,137
6.50% 8/1/08 A1 9,500,000 11,132,670
(Consolidated Loan):
Series A:
7.50% 6/1/04 A1 4,830,000 5,650,520
5.40% 11/1/06 A1 1,000,000 1,077,370
5% 3/1/08 (AMBAC Insured) Aaa 15,000,000 15,731,700
Series B:
(Cap. Appreciation) 0% 6/1/99 A1 1,000,000 948,870
(Cap. Appreciation) 0% 7/1/02 A1 12,250,000 10,196,900
5.75% 6/1/16 (Pre-Refunded to
6/1/06 @ 101) (d) A1 16,820,000 18,628,486
Series C (Cap. Appreciation) 0% 12/1/05 A1 6,500,000 4,637,035
Series D, 6% 7/1/12 (Pre-Refunded to
7/1/01 @ 100) (d) A1 1,460,000 1,549,717
Massachusetts Health & Ed. Facs. Auth. Rev.:
Rfdg.:
(Boston College) Series K:
5.25% 6/1/10 A1 3,025,000 3,213,216
5.375% 6/1/14 A1 10,445,000 11,020,415
(Emerson Hosp.) Series D, 5.70% 8/15/12
(FSA Insured) Aaa 9,475,000 10,048,522
(Fairview Extended Care) Series B, 4.55%
7/14/02 (MBIA Insured) LOC BankBoston NA Aaa 6,700,000 6,700,000
(Harvard Univ.) Series P:
6.50% 11/1/05 Aaa 1,000,000 1,160,810
5.60% 11/1/14 Aaa 1,000,000 1,061,130
5.625% 11/1/28 Aaa 1,500,000 1,579,065
(Massachusetts Gen. Hosp.) Series F, 6.25%
7/1/12 (AMBAC Insured) Aaa 4,750,000 5,416,852
(Morton Hosp. & Med. Ctr.) Series B,
5.25% 7/1/08 (Connie Lee Insured) Aaa 2,800,000 2,931,012
(Newton-Wellesley Hosp.) Series G:
6% 7/1/12 (MBIA Insured) Aaa 4,070,000 4,532,352
6.125% 7/1/15 (MBIA Insured) Aaa 4,500,000 4,991,625
(Wheaton College) Series C:
5.125% 7/1/09 A2 1,130,000 1,161,572
5.25% 7/1/14 A2 2,655,000 2,713,118
5.25% 7/1/19 A2 2,000,000 2,021,780
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (A) AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Massachusetts Health & Ed. Facs. Auth. Rev.: - continued
(Anna Jacques Hosp.) Series B:
5.90% 10/1/99 Baa1 $ 930,000 $ 950,516
6% 10/1/00 Baa1 985,000 1,017,820
6.875% 10/1/12 Baa1 3,250,000 3,484,487
(Baystate Med. Ctr.):
Series D, 5.50% 7/1/16 (FGIC Insured) Aaa 6,400,000 6,583,744
Series E:
6% 7/1/04 (FSA Insured) Aaa 1,290,000 1,412,292
6% 7/1/05 (FSA Insured) Aaa 1,385,000 1,529,372
6% 7/1/06 (FSA Insured) Aaa 1,425,000 1,585,127
(Blood Research Institute)
Series A, 6.50% 2/1/22 - 15,310,000 16,790,171
(Cape Cod Health Sys.) Series A, 5.25%
11/15/13 (Connie Lee Insured) Aaa 3,500,000 3,585,190
(Central Massachusetts Med. Ctr.)
Series B, 9.03% 6/23/22
(AMBAC Insured) INFL (f) Aaa 10,000,000 12,936,900
(Dana Farber Cancer Proj.):
Series G, 6.25% 12/1/14 A1 3,000,000 3,328,800
Series G-1, 5.50% 12/1/27 A1 18,600,000 18,799,020
(Emerson Hosp.) Series C, 8% 7/1/18
(Pre-Refunded to 7/1/00 @ 102) (d) Aaa 21,755,000 24,181,553
(Falmouth Hosp.) Series C, 5.50% 7/1/08
(MBIA Insured) Aaa 1,000,000 1,065,940
(Faulkner Hosp.) Series C:
6% 7/1/13 Baa1 9,745,000 10,151,756
6% 7/1/23 Baa1 6,010,000 6,186,634
(Hebrew Rehabilitation Ctr. for Aged) Series B,
7.375% 7/1/17 A 14,000,000 14,395,640
(Lahey Hitchcock Clinic Med. Ctr.) Series B,
5.25% 7/1/10 (MBIA Insured) Aaa 14,120,000 14,564,921
(Lowell Gen. Hosp.) Series A:
8.25% 6/1/00 (Escrowed to Maturity) (d) A3 1,915,000 2,033,328
8.40% 6/1/11 (Pre-Refunded to 6/1/01
@ 102) (d) A3 2,565,000 2,957,855
(Mass Institute of Technology) Series I,
5.20% 1/1/28 Aaa 4,000,000 4,156,400
(Medical Academic & Scientific Commission
Organizations) Series A, 6.625% 1/1/15 A- 4,150,000 4,575,458
(Mount Auburn Hosp.) Series B-1:
6.25% 8/15/14 (MBIA Insured) Aaa 1,250,000 1,385,187
6.30% 8/15/24 (MBIA Insured) Aaa 5,000,000 5,471,400
(New England Medical Ctr. Hosp.) Series G,
5.375% 7/1/24 (MBIA Insured) Aaa 1,000,000 1,013,890
(Notre Dame Health Care Ctr.) Series A:
7.25% 10/1/01 - 490,000 524,030
7.875% 10/1/22 - 5,000,000 5,400,900
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (A) AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Massachusetts Health & Ed. Facs. Auth. Rev.: - continued
(Partners Healthcare Sys.):
5.375% 7/1/24 (MBIA Insured) Aaa $ 7,850,000 $ 7,970,340
Series A:
5.25% 7/1/04 (FSA Insured) Aaa 2,000,000 2,114,220
5.50% 7/1/05 (FSA Insured) Aaa 2,000,000 2,154,880
5.50% 7/1/07 (FSA Insured) Aaa 2,390,000 2,578,093
5.25% 7/1/15 (MBIA Insured) Aaa 2,940,000 2,981,601
(Simmons College) Series B, 7.50% 10/1/20 Baa1 6,190,000 6,741,096
(Tufts Univ.) 5.85% 8/15/18 (FGIC Insured) INFL (f) Aaa 7,900,000
8,440,360
(Williams College) Series F, 5.75% 7/1/19 Aa1 3,000,000 3,173,040
Massachusetts Hsg. Fin. Agcy. Hsg. Rev.
(Single Family):
Rfdg. Series A, 6% 12/1/13 (MBIA Insured) Aaa 5,680,000 6,032,274
Series 3, 7.30% 6/1/14 Aa 6,000,000 6,082,500
Series 8, 7.70% 6/1/17 Aa 500,000 518,625
Series 10, 7.70% 12/1/17 Aa 660,000 690,888
Series 29, 6.75% 6/1/26 (c) Aa 2,700,000 2,936,790
Series 40, 6.60% 12/1/24 (c) Aa 19,550,000 21,130,422
Series 40, 6.65% 12/1/27 (c) Aa 7,000,000 7,586,810
Series 53, 5.20% 12/1/21 (MBIA Insured) (c) Aaa 1,770,000
1,829,879
Massachusetts Ind. Fin. Agcy. Rev.:
Rfdg:
(Atlanticare Med. Ctr.) Series A, 10.125%
11/1/14 - 1,900,000 2,106,910
(Chelsea Jewish Nursing Home) Series A,
11.15% 2/15/25 (FHA Guaranteed) A- 3,520,000 3,861,862
(Framingham Union Hosp.) Series A,
8.25% 7/1/00 (Pre-Refunded to 7/1/98 @
102) (d) Aaa 1,905,000 1,978,381
(Lesley College) Series A, 6.30% 7/1/15
(Connie Lee Insured) Aaa 2,525,000 2,767,752
(Milton Academy) Series B, 5.25% 9/1/19
(MBIA Insured) Aaa 2,500,000 2,524,775
(Museum of Fine Arts Boston):
5% 1/1/01 (MBIA Insured) Aaa 2,800,000 2,882,236
5.125% 1/1/04 (MBIA Insured) Aaa 1,150,000 1,208,581
5.375% 1/1/05 (MBIA Insured) Aaa 3,475,000 3,719,605
(Springfield College):
5.25% 9/15/03 Baa1 755,000 776,925
5.25% 9/15/04 Baa1 885,000 909,718
5.35% 9/15/05 Baa1 930,000 959,286
5.625% 9/15/10 Baa1 1,000,000 1,020,080
(Worcester Polytechnic Institute):
5.75% 9/1/05 (MBIA Insured) Aaa 1,340,000 1,467,287
5.75% 9/1/06 (MBIA Insured) Aaa 1,415,000 1,559,019
5.75% 9/1/07 (MBIA Insured) Aaa 1,500,000 1,654,905
5.75% 9/1/08 (MBIA Insured) Aaa 1,585,000 1,755,261
(Atlanticare Med. Ctr.) Series B, 10.125%
11/1/14 - 7,900,000 8,760,310
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (A) AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Massachusetts Ind. Fin. Agcy. Rev.: - continued
(Babson College) Series A:
5.60% 10/1/06 (MBIA Insured) Aaa $ 515,000 $ 566,994
5.70% 11/1/07 (MBIA Insured) Aaa 545,000 602,247
(Concord Academy) 6.90% 9/1/21
(FSA Insured) Aaa 1,370,000 1,507,945
(Leominster Hosp.) Series A, 8.375% 8/1/99
(Escrowed to Maturity) (d) - 2,100,000 2,181,963
(Massachusetts Biomedical Research/Mass.
Gen. Hosp.) (Cap. Appreciation):
Series A-1, 0% 8/1/02 A1 3,650,000 3,017,163
Series A-2:
0% 8/1/03 A1 1,000,000 790,390
0% 8/1/05 A1 24,600,000 17,659,602
0% 8/1/07 - 25,000,000 16,144,000
0% 8/1/08 - 15,000,000 9,128,550
(Whitehead Institute Biomedical Research)
5.125% 7/1/26 Aa2 14,600,000 14,570,070
Massachusetts Ind. Fin. Auth. Poll. Cont. Rev.
Rfdg. (Boston Edison Co. Proj.) Series A,
5.75% 2/1/14 Baa2 9,900,000 10,259,568
Massachusetts Muni. Wholesale Elec. Co.
Pwr. Supply Rev.:
Rfdg. Series A:
5.10% 7/1/08 (AMBAC Insured) Aaa 1,000,000 1,058,370
6.75% 7/1/08 Baa2 3,000,000 3,258,450
6% 7/1/18 (MBIA Insured) Aaa 10,000,000 10,422,300
Rfdg. Series B:
6.50% 7/1/02 (MBIA Insured) Aaa 2,000,000 2,195,960
6.625% 7/1/04 Baa2 4,675,000 5,127,119
6.75% 7/1/08 Baa2 2,000,000 2,172,300
Series B, 6.75% 7/1/17 Baa2 9,050,000 9,777,167
Series C, 6.625% 7/1/18 (MBIA Insured) Aaa 10,000,000 10,984,000
Series D, 6% 7/1/06 Baa2 1,000,000 1,065,800
Series E, 6% 7/1/06 Baa2 1,640,000 1,747,912
Massachusetts Port Auth. Rev.:
Rfdg.:
7.125% 7/1/12 Aa3 2,490,000 2,512,534
Series A:
5.50% 7/1/09 Aa3 3,160,000 3,296,417
5% 7/1/13 Aa3 8,835,000 8,866,983
Series A:
6% 7/1/03 Aa3 1,000,000 1,088,510
6% 7/1/04 Aa3 1,390,000 1,525,038
5.50% 9/1/10 (MBIA Insured) (c) Aaa 2,030,000 2,137,245
5.625% 7/1/12 (Escrowed to Maturity) (d) Aaa 1,900,000 2,014,000
Massachusetts Spl. Oblig. Rev.:
(Gas Tax) Series A, 6% 6/1/13 Aa3 17,695,000 19,013,808
Consolidated Loan Series A:
5.50% 6/1/12 Aa3 2,000,000 2,171,500
5.50% 6/1/13 Aa3 3,000,000 3,245,820
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (A) AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Massachusetts Spl. Oblig. Rev.: - continued
Series A:
5.20% 6/1/07 (AMBAC Insured) Aaa $ 6,950,000 $ 7,340,590
5.80% 6/1/14 (Pre-Refunded to
6/1/04 @ 101) (d) Aa3 4,185,000 4,585,421
Massachusetts Tpk. Auth.:
Metropolitan Hwy. Sys. Rev. Series A,
5% 1/1/27 (MBIA Insured) Aaa 13,000,000 12,691,510
Western Tpk. Rev. Series A,
5.55% /1/17 (MBIA Insured) Aaa 24,800,000 25,236,232
Massachusetts Wtr. Poll. Abatement Trust Wtr.
Poll. Abatement Rev. (Pooled Loan Prog.):
Series 1:
5.40% 2/1/06 Aaa 2,175,000 2,323,727
5.40% 8/1/06 Aaa 2,230,000 2,382,487
5.45% 2/1/07 Aaa 2,000,000 2,134,500
Series 3:
6% 2/1/06 Aaa 3,000,000 3,341,730
6% 2/1/07 Aaa 4,795,000 5,390,779
5.40% 2/1/10 Aaa 1,700,000 1,809,684
5.50% 2/1/13 Aaa 6,715,000 7,130,860
Series A:
8/1/02 Aa 3,255,000 3,531,447
6% 8/1/03 Aa 3,450,000 3,775,715
6% 8/1/04 Aa 3,670,000 4,065,920
5.30% 2/1/05 Aaa 1,000,000 1,065,410
6% 8/1/05 Aa 1,500,000 1,673,190
Massachusetts Wtr. Resource Auth. Rev.:
Rfdg. Series B:
5.875% 11/1/04 A 1,975,000 2,147,477
6% 11/1/08 A 4,500,000 4,862,250
6.25% 11/1/10 A 3,605,000 3,928,477
5.50% 8/1/15 (FSA Insured) Aaa 2,750,000 2,969,258
5.50% 8/1/16 (FSA Insured) Aaa 1,425,000 1,533,642
5% 3/1/22 A2 13,000,000 12,821,900
Rfdg. Series C:
6% 12/1/11 A2 2,000,000 2,279,240
4.75% 12/1/23 A2 13,000,000 12,227,020
Series A:
(Cap. Appreciation) 0% 4/1/06 (MBIA Insured) Aaa 7,500,000
5,265,825
5.50% 7/15/22 (Pre-Refunded to
7/15/02 @ 102) (d) A2 2,000,000 2,112,720
6.50% 7/15/07 A2 6,000,000 6,993,060
6.50% 7/15/09 A2 4,750,000 5,614,643
5.80% 8/1/11 (MBIA Insured) (Pre-Refunded
to 8/1/04 @ 101.50) (d) Aaa 2,740,000 3,026,440
6.50% 7/15/19 A2 16,960,000 20,851,133
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (A) AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Mendon Upton Reg'l. School Dist.:
5% 6/1/08 (FGIC Insured) Aaa $ 1,215,000 $ 1,277,500
5.125% 6/1/09 (FGIC Insured) Aaa 1,285,000 1,358,643
5.125% 6/1/10 (FGIC Insured) Aaa 1,355,000 1,420,352
5.25% 6/1/11 (FGIC Insured) Aaa 1,435,000 1,505,659
Methuen Gen. Oblig.:
5.25% 11/1/07 (FGIC Insured) Aaa 1,355,000 1,452,546
5.25% 11/1/08 (FGIC Insured) Aaa 1,415,000 1,512,706
5.25% 11/1/09 (FGIC Insured) Aaa 1,480,000 1,571,982
5.25% 11/1/10 (FGIC Insured) Aaa 1,550,000 1,633,778
Monson Gen. Oblig. Rfdg. 5.50% 10/15/10
(MBIA Insured) Aaa 1,080,000 1,179,976
Nantucket Island Gen. Oblig.:
Rfdg.:
5.50% 7/15/08 (MBIA Insured) Aaa 2,750,000 2,992,028
5.50% 7/15/09 (MBIA Insured) Aaa 2,915,000 3,148,054
5.375% 7/15/11 (MBIA Insured) Aaa 3,005,000 3,169,103
Nantucket Island Land Bank Rfdg.
Series E, 7.25% 7/1/19 A 6,175,000 6,822,140
New England Edl. Loan Marketing Corp. Student
Loan Rev. Series A:
5.80% 3/1/02 Aaa 32,000,000 33,845,760
5.70% 7/1/05 (c) A1 4,750,000 5,081,028
North Attleborough Gen. Oblig. Ltd. Tax Rfdg.
5.25% 11/1/13 (AMBAC Insured) Aaa 1,000,000 1,028,130
Pentucket Reg'l. School Dist.:
5.10% 2/15/11 (MBIA Insured) Aaa 530,000 541,236
5.10% 2/15/12 (MBIA Insured) Aaa 220,000 223,782
5.10% 2/15/13 (MBIA Insured) Aaa 575,000 582,970
5.10% 2/15/14 (MBIA Insured) Aaa 525,000 529,846
Plymouth County Ctfs. of Prtn. Series A, 7% 4/1/22 AA- 10,995,000
12,282,954
Quincy Hosp. Rev. Rfdg. (Quincy City Hosp.):
5.30% 1/15/11 (FSA Insured) Aaa 11,400,000 11,586,846
5.25% 1/15/16 (FSA Insured) Aaa 2,000,000 2,028,580
South Essex Swr. Dist. Rev.:
Rfdg. Series A:
6% 6/15/03 (MBIA Insured) Aaa 2,390,000 2,614,373
6% 6/15/04 (MBIA Insured) Aaa 2,375,000 2,621,003
6% 6/15/05 (MBIA Insured) Aaa 1,175,000 1,305,449
6% 6/15/06 (MBIA Insured) Aaa 2,305,000 2,576,529
7% 6/1/24 (MBIA Insured) (Pre-Refunded to
6/1/24 @ 102) (d) Aaa 1,000,000 1,175,520
Southern Berkshire Reg'l. School Dist. 7% 4/15/11
(MBIA Insured) (Pre-Refunded to 4/15/03
@ 100) (d)(e) Aaa 4,000,000 4,526,840
Taunton Elec. Gen. Oblig. 8% 2/1/05 A3 1,000,000 1,213,600
Taunton Ind. Dev. Fing. Auth. Ind. Dev. Rev. Rfdg.
(Pepsi Cola Metro Bottle Co. Proj.)
5.65% 8/1/12 A1 2,400,000 2,511,840
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (A) AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Tewksbury Gen. Oblig.:
7.20% 6/1/05 A2 $ 350,000 $ 403,225
7.20% 6/1/06 A2 150,000 174,825
Tewksbury Gen. Oblig. Unltd. Tax (Various Purp.):
9.60% 12/15/98 A2 595,000 623,637
9.60% 12/15/01 A2 210,000 248,228
9.60% 12/15/02 A2 210,000 256,343
Westfield Muni. Purp. Loan:
5% 9/1/10 (FSA Insured) Aaa 745,000 764,839
5% 9/1/11 (FSA Insured) Aaa 640,000 650,477
5% 9/1/12 (FSA Insured) Aaa 745,000 754,827
5% 9/1/13 (FSA Insured) Aaa 750,000 756,563
Winchedon School Proj. Loan Unltd Tax
6.05% 3/15/12 (AMBAC Insured) Aaa 1,275,000 1,379,971
Woods Hole Martha's Vineyard & Nantucket
Steamship Auth. Rfdg. Series A, 5.125% 3/1/11 A1 1,100,000
1,119,327
Worcester Gen. Oblig. Rfdg. (Muni. Purp.)
Series G, 5.50% 7/1/03 (MBIA Insured) Aaa 3,430,000 3,664,955
1,155,407,565
PUERTO RICO - 2.1%
Puerto Rico Commonwealth Gen. Oblig. Rfdg.
(Pub. Impt.) 3% 7/1/06 (MBIA Insured) Aaa 10,000,000 9,151,200
Puerto Rico Elec. Pwr. Auth. Pwr. Rev. Rfdg.:
Series W, 6.50% 7/1/05 (MBIA Insured) Aaa 9,000,000 10,368,720
Series Y, 6.50% 7/1/06 (MBIA Insured) Aaa 4,000,000 4,662,480
Puerto Rico Ind. Med. & Envir. Poll. Cont. Facs.
Fing. Auth. Rev. (Motorola, Inc. Proj.)
Series A, 6.75% 1/1/14 (h) Aa3 1,500,000 1,660,890
25,843,290
TOTAL MUNICIPAL BONDS
(Cost $1,093,889,469) 1,181,250,855
MUNICIPAL NOTES (B) - 3.1%
MASSACHUSETTS - 3.0%
Massachusetts Health & Ed. Facs. Auth. Rev.:
(Boston Univ.) Series H, 3.50% 4/1/98,
LOC Landesbank Hessen-Thuringen, VRDN P-1 1,000,000 999,980
(Cap. Asset Prog.):
Series B, 3.55% (MBIA Insured) (BPA
Sanwa Bank) VRDN VMIG 1 900,000 900,000
Series E, 3.55%, LOC First National
Bank Chicago, VRDN VMIG 1 11,200,000 11,200,000
Series 1985 D, 3.55% (MBIA Insured)
(BPA Credit Swiss First Boston) VRDN VMIG 1 700,000 700,000
MUNICIPAL NOTES (B) - CONTINUED
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (A) AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Massachusetts Health & Ed. Facs. Auth. Rev.: - continued
(Harvard Univ.) Series P, 3.60% (Liquidity
Facility Societe Generale) VRDN A-1+ $ 1,000,000 $ 1,000,000
(Partners Healthcare Sys.) Series P-1, 3.25%
(FSA Insured) VRDN VMIG 1 4,700,000 4,700,000
Massachusetts Ind. Fin. Agcy. Rev.:
Rfdg. (Showa Women's Inst. of Boston - 1994
Proj.) 3.70%, LOC Fuji Bank, VRDN VMIG 1 600,000 600,000
(Goddard House) 3.75%, LOC Fleet Nat'l.
Bank, VRDN A-1 500,000 500,000
Massachusetts Muni. Wholesale Elec. Co. Pwr.
Supply Sys. Series 1994 C, 3.25% (MBIA Insured)
LOC Credit Swiss First Boston, VRDN VMIG 1 1,000,000 1,000,000
Massachusetts Port Auth. Rev. Rfdg.
Series 1995-B, 3.70%, LOC Landesbank
Hessen-Thuringen, VRDN VMIG 1 4,200,000 4,200,000
Massachusetts Turnpike Auth. Participating VRDN:
Series B, 4.05% (Liquidity Facility Merrill Lynch
& Co., Inc.) (g) A-1+ 1,000,000 1,000,000
3.85% (Liquidity Facility Banco
Santander, SA) (g) VMIG 1 7,000,000 7,000,000
Massachusetts Wtr. Resources Auth. Multi-Modal
Subordinate Gen. Rev. Series 1997-B, 3.75%
(AMBAC Insured) (Liquidity Facility Bank of
Nova Scotia) VRDN A-1+ 2,700,000 2,700,000
36,499,980
PUERTO RICO - 0.1%
Univ. of Puerto Rico Sys. Rev. Participating VRDN
Series M, 3.75% (Liquidity Facility
Societe Generale) (g) A-1+ 1,100,000 1,100,000
TOTAL MUNICIPAL NOTES
(Cost $37,600,000) 37,599,980
TOTAL INVESTMENT IN SECURITIES - 100%
(Cost $1,131,489,469) $ 1,218,850,835
FUTURES CONTRACTS
EXPIRATION UNDERLYING FACE UNREALIZED
DATE AMOUNT AT VALUE GAIN/(LOSS)
PURCHASED
104 Municipal Bond Contracts Mar. 1998 $12,928,500 $ 122,494
75 US Treasury Contracts Mar. 1998 9,171,094 116,732
$ 239,226
THE FACE VALUE OF FUTURES SOLD AS A PERCENTAGE OF TOTAL INVESTMENT IN
SECURITIES - 1.8%
SECURITY TYPE ABBREVIATIONS
INFL - Inverse Floating Rate Security
VRDN - Variable Rate Demand Notes
LEGEND
1. Standard & Poor's 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.
4. Security collateralized by an amount sufficient to pay interest and
principal.
5. A portion of the security was pledged to cover margin requirements
for futures contracts. At the period end, the value of the security
pledged amounted to $707,319.
6. Coupon is inversely indexed to a floating interest rate. The price
will be more volatile than the price of a comparable fixed rate
security. The rate shown is the rate at period end.
7. Provides evidence of ownership in one or more underlying municipal
bonds.
8. Security exempt from registration under Rule 144A of the Securities
Act of 1933. These securities may be resold in transactions exempt
from registration, normally to qualified institutional buyers. At the
period end, the value of these securities amounted to $1,660,890 or
0.1% of net assets.
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 76.6% AAA, AA, A 74.0%
Baa 5.9% BBB 3.6%
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 Moody's or S&P amounted to 1.0%.
The distribution of municipal securities by revenue source, as a
percentage of total value of investment in securities, is as follows:
General Obligation 26.5%
Health Care 21.1
Water and Sewer 11.7
Education 9.4
Escrowed/Pre-Refunded 7.5
Electric Revenue 6.1
Housing 5.3
Transportation 5.1
Others (individually less than 5%) 7.3
TOTAL 100.0%
INCOME TAX INFORMATION
At January 31, 1998 the aggregate cost of investment securities for
income tax purposes was $1,131,531,966. Net unrealized appreciation
aggregated $87,318,869, of which $87,631,412 is related to appreciated
investment securities and $312,543 is related to depreciated
investment securities.
At January 31, 1998, the fund had a capital loss carryforward of
approximately $694,000 all of which will expire on January 31, 2004.
At January 31, 1998, the fund was required to defer approximately
$8,044,000 of losses on futures contracts.
SPARTAN MASSACHUSETTS MUNICIPAL INCOME FUND
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
JANUARY 31, 1998
ASSETS
INVESTMENT IN SECURITIES, AT VALUE $ 1,218,850,835
(COST $1,131,489,469) -
SEE ACCOMPANYING SCHEDULE
CASH 383,316
INTEREST RECEIVABLE 14,515,874
RECEIVABLE FOR DAILY VARIATION 53,219
ON FUTURES CONTRACTS
TOTAL ASSETS 1,233,803,244
LIABILITIES
DISTRIBUTIONS PAYABLE $ 1,079,162
ACCRUED MANAGEMENT FEE 395,227
OTHER PAYABLES AND ACCRUED 177,592
EXPENSES
TOTAL LIABILITIES 1,651,981
NET ASSETS $ 1,232,151,263
NET ASSETS CONSIST OF:
PAID IN CAPITAL $ 1,153,514,122
ACCUMULATED UNDISTRIBUTED NET (8,963,451)
REALIZED GAIN (LOSS)
ON INVESTMENTS
NET UNREALIZED APPRECIATION 87,600,592
(DEPRECIATION) ON INVESTMENTS
NET ASSETS, FOR 102,967,974 $ 1,232,151,263
SHARES OUTSTANDING
NET ASSET VALUE, OFFERING PRICE $11.97
AND REDEMPTION PRICE PER
SHARE ($1,232,151,263 (DIVIDED BY)
102,967,974 SHARES)
STATEMENT OF OPERATIONS
YEAR ENDED JANUARY 31, 1998
INTEREST INCOME $ 64,911,113
EXPENSES
MANAGEMENT FEE $ 4,479,749
TRANSFER AGENT FEES 1,191,887
CUSTODIAN FEES AND EXPENSES 49,313
NON-INTERESTED TRUSTEES' 5,674
COMPENSATION
ACCOUNTING FEES AND EXPENSES 358,567
REGISTRATION FEES 19,691
AUDIT 41,382
LEGAL 5,897
TOTAL EXPENSES BEFORE 6,152,160
REDUCTIONS
EXPENSE REDUCTIONS (14,522) 6,137,638
NET INTEREST INCOME 58,773,475
REALIZED AND UNREALIZED GAIN
(LOSS)
NET REALIZED GAIN (LOSS) ON:
INVESTMENT SECURITIES 6,801,403
FUTURES CONTRACTS (2,396,129) 4,405,274
CHANGE IN NET UNREALIZED
APPRECIATION (DEPRECIATION)
ON:
INVESTMENT SECURITIES 48,814,186
FUTURES CONTRACTS 267,078 49,081,264
NET GAIN (LOSS) 53,486,538
NET INCREASE (DECREASE) IN NET $ 112,260,013
ASSETS RESULTING
FROM OPERATIONS
OTHER INFORMATION
EXPENSE REDUCTION $ 1,855
CUSTODIAN CREDITS
TRANSFER AGENT CREDITS 12,667
$ 14,522
STATEMENT OF CHANGES IN NET ASSETS
YEAR ENDED YEAR ENDED
JANUARY 31, JANUARY 31,
1998 1997
INCREASE (DECREASE) IN NET
ASSETS
OPERATIONS $ 58,773,475 $ 59,360,679
NET INTEREST INCOME
NET REALIZED GAIN (LOSS) 4,405,274 2,084,824
CHANGE IN NET UNREALIZED 49,081,264 (29,165,207)
APPRECIATION (DEPRECIATION)
NET INCREASE (DECREASE) IN 112,260,013 32,280,296
NET ASSETS RESULTING
FROM OPERATIONS
DISTRIBUTIONS TO SHAREHOLDERS (58,773,475) (59,360,679)
FROM NET INTEREST INCOME
FROM NET REALIZED GAIN (203,660) (397,849)
TOTAL DISTRIBUTIONS (58,977,135) (59,758,528)
SHARE TRANSACTIONS 261,113,021 217,181,484
NET PROCEEDS FROM SALES OF
SHARES
REINVESTMENT OF DISTRIBUTIONS 45,288,591 45,372,188
COST OF SHARES REDEEMED (255,383,961) (277,432,129)
NET INCREASE (DECREASE) IN 51,017,651 (14,878,457)
NET ASSETS RESULTING
FROM SHARE TRANSACTIONS
TOTAL INCREASE (DECREASE) IN 104,300,529 (42,356,689)
NET ASSETS
NET ASSETS
BEGINNING OF PERIOD 1,127,850,734 1,170,207,423
END OF PERIOD $ 1,232,151,263 $ 1,127,850,734
OTHER INFORMATION
SHARES
SOLD 22,418,980 19,127,456
ISSUED IN REINVESTMENT OF 3,892,109 3,997,722
DISTRIBUTIONS
REDEEMED (22,025,592) (24,478,328)
NET INCREASE (DECREASE) 4,285,497 (1,353,150)
FINANCIAL HIGHLIGHTS
YEARS ENDED JANUARY 31,
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
1998 1997 1996 1995 1994
SELECTED
PER-SHARE
DATA
NET ASSET VALUE, $ 11.430 $ 11.700 $ 10.800 $ 12.210 $ 11.750
BEGINNING
OF PERIOD
INCOME FROM .593 .605 .652 .700 .714
INVESTMENT
OPERATIONS
NET INTEREST
INCOME
NET REALIZED .542 (.266) .902 (1.180) .720
AND
UNREALIZED
GAIN (LOSS)
TOTAL FROM 1.135 .339 1.554 (.480) 1.434
INVESTMENT
OPERATIONS
LESS DISTRIBUTIONS
FROM NET (.593) (.605) (.654) B (.700) (.714)
INTEREST INCOME
FROM NET (.002) (.004) - (.230) (.230)
REALIZED GAIN
IN EXCESS OF NET - - - - (.030)
REALIZED
GAIN
TOTAL (.595) (.609) (.654) (.930) (.974)
DISTRIBUTIONS
NET ASSET VALUE, $ 11.970 $ 11.430 $ 11.700 $ 10.800 $ 12.210
END OF PERIOD
TOTAL RETURN A 10.21% 3.06% 14.76% (3.79)% 12.57%
RATIOS AND
SUPPLEMENTAL
DATA
NET ASSETS, END $ 1,232,151 $ 1,127,851 $ 1,170,207 $ 1,036,181 $ 1,387,410
OF PERIOD
(000 OMITTED)
RATIO OF EXPENSES .53% .56% .55% .54% .54%
TO AVERAGE NET
ASSETS
RATIO OF EXPENSES .53% .56% .54% C .54% .54%
TO AVERAGE NET
ASSETS AFTER
EXPENSE
REDUCTIONS
RATIO OF NET 5.10% 5.29% 5.80% 6.29% 5.93%
INTEREST INCOME
TO AVERAGE NET
ASSETS
PORTFOLIO TURNOVER 21% 44% 33% 22% 40%
RATE
</TABLE>
A THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT
BEEN REDUCED DURING THE PERIODS SHOWN.
B THE AMOUNTS SHOWN REFLECT CERTAIN RECLASSIFICATIONS RELATED TO BOOK
TO TAX DIFFERENCES (SEE NOTE 1 OF NOTES TO FINANCIAL STATEMENTS).
C FMR OR THE FUND HAS ENTERED INTO VARYING ARRANGEMENTS WITH THIRD
PARTIES WHO EITHER PAID OR REDUCED A PORTION OF THE FUND'S EXPENSES.
FIDELITY MASSACHUSETTS MUNICIPAL MONEY MARKET FUND
PERFORMANCE: THE BOTTOM LINE
To measure a money market fund's performance, you can look at either
total return or yield. Total return reflects the change in the value
of an investment, assuming reinvestment of the fund's dividend income.
Yield measures the income paid by a fund. Since a money market fund
tries to maintain a $1 share price, yield is an important measure of
performance.
CUMULATIVE TOTAL RETURNS
PERIODS ENDED JANUARY 31, 1998 PAST 1 PAST 5 PAST 10
YEAR YEARS YEARS
FIDELITY MA MUNI MONEY MARKET 3.10% 13.90% 40.96%
MASSACHUSETTS TAX-FREE 3.07% 14.16% 42.17%
MONEY MARKET FUNDS AVERAGE
CUMULATIVE TOTAL RETURNS show the fund's performance in percentage
terms over a set period - in this case, one year, five years or 10
years. For example, if you had invested $1,000 in a fund that had a 5%
return over the past year, the value of your investment would be
$1,050. To measure how the fund's performance stacked up against its
peers, you can compare it to the Massachusetts tax-free money market
funds average, which reflects the performance of Massachusetts
tax-free money market funds with similar objectives tracked by IBC
Financial Data, Inc. The past one year average represents a peer group
of 12 mutual funds.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED JANUARY 31, 1998 PAST 1 PAST 5 PAST 10
YEAR YEARS YEARS
FIDELITY MA MUNI MONEY MARKET 3.10% 2.64% 3.49%
MASSACHUSETTS TAX-FREE 3.07% 2.68% 3.58%
MONEY MARKET FUNDS AVERAGE
AVERAGE ANNUAL TOTAL RETURNS take the fund's cumulative return and
show you what would have happened if the fund had performed at a
constant rate each year.
YIELDS
2/2/98 11/3/97 7/28/97 4/28/97 2/3/97
MASSACHUSETTS MUNICIPAL 2.93% 3.13% 3.12% 3.45% 2.90%
MONEY MARKET FUND
MASSACHUSETTS 2.87% 3.02% 3.05% 3.45% 2.89%
TAX-FREE MONEY MARKET
FUNDS AVERAGE
MASSACHUSETTS MUNICIPAL 5.20% 5.56% 5.54% 6.13% 5.15%
MONEY MARKET TAX-EQUIVALENT
YIELD refers to the income paid by the fund over a given period.
Yields for money market funds are usually for seven-day periods,
expressed as annual percentage rates. A yield that assumes income
earned is reinvested or compounded is called an effective yield. The
chart above shows the fund's seven-day yield at quarterly intervals
over the past year. You can compare these yields to the Massachusetts
tax-free money market funds average as tracked by IBC Financial Data,
Inc., or you can look at the fund's tax-equivalent yield, which is
based on a combined effective 1997 federal and state income tax rate
of 43.68%, but does not reflect payment of the alternative minimum
tax.
A MONEY MARKET FUND'S TOTAL RETURNS AND YIELDS WILL VARY, AND REFLECT
PAST RESULTS RATHER THAN PREDICT FUTURE PERFORMANCE.
COMPARING
PERFORMANCE
Yields on tax-free investments
are usually lower than yields
on taxable investments.
However, a straight
comparison between the two
may be misleading because
it ignores the way taxes reduce
taxable returns. Tax-equivalent
yield - the yield you'd have
to earn on a similar taxable
investment to match the tax-free
yield - makes the comparison
more meaningful. Keep in
mind that the U.S.
Government neither insures
nor guarantees a money
market fund, and there is no
assurance that a money
market fund will maintain a $1
share price.
(checkmark)
FIDELITY MASSACHUSETTS MUNICIPAL MONEY MARKET FUND
FUND TALK: THE MANAGER'S OVERVIEW
NOTE TO SHAREHOLDERS: Scott Orr became Portfolio Manager of Fidelity
Massachusetts Municipal Money Market Fund on November 1, 1997.
Q. SCOTT, WHAT WAS THE INVESTING ENVIRONMENT LIKE OVER THE PAST 12
MONTHS?
A. Overall, economic strength continued as real GDP - gross domestic
product adjusted for inflation - grew at a rate approaching 4% in
1997. In addition, the unemployment rate for the year averaged 4.9%.
Normally, one may expect this combination of strong growth and a tight
labor market to spark inflation, but inflation was benign. Early in
1997, the market expected an interest-rate increase by the Federal
Reserve Board, as the economy grew at a torrid pace. On March 25,
1997, the Fed announced it had increased the fed funds rate - the rate
banks charge each other for overnight loans - from 5.25% to 5.50%. For
the next month or so, expectations were high that the Fed would
continue to raise rates. However, at its May meeting, the Fed decided
to hold off because economic growth had moderated and inflation was
still benign.
Q. WHAT'S HAPPENED SINCE THEN?
A. For the rest of the year, economic activity was moderate to fairly
strong, and inflation remained in check. Consequently, the Fed opted
to keep rates unchanged. It wasn't until mid-October that several Fed
officials made comments indicating that they were again thinking of
raising rates in order to slow the economy before inflation emerged.
However, that was before economic and market turmoil hit Southeast
Asia in late October and continued through the end of the period. Some
Fed officials felt that the continuation of stronger-than-expected
monthly employment reports would force wage increases that could be
passed on to the consumer - meaning inflation. At the same time, the
Asian situation caused concern that U.S. export growth would weaken as
Asian goods became increasingly cheaper. Therefore, the co-existence
of tight labor markets and the uncertainty in Asia created an
equilibrium that kept rates steady.
Q. WHAT WAS THE FUND'S STRATEGY DURING THIS 12-MONTH PERIOD?
A. The Massachusetts market is unique because there typically is a
steady supply of one-year, fixed-rate Massachusetts municipal notes
coming to market throughout the year. To take advantage of this
situation, I bought these notes regularly, laddering the maturities so
that as some one-year notes matured, I purchased more to replace them.
This strategy kept the fund's average maturity a bit longer than might
be expected in some of the market environments we've seen. For
example, during the first half of the period I was expecting the Fed
to raise rates. In most cases, that would mean the fund would have a
shorter average maturity, holding more variable-rate securities whose
interest rates would float upward in a rising rate environment.
However, the plentiful supply of Massachusetts one-year, fixed-rate
notes made it more worthwhile to purchase them because they were
offering more attractive yields than those offered in the
shorter-term, variable-rate part of the market. The fund's average
maturity started the period at 51 days. For the remainder of the
period, the fund's average maturity remained in the mid-40- to
low-50-day range - a neutral stance reflecting my expectation of
fairly stable rates for the next few months.
Q. HOW DID THE FUND PERFORM?
A. The fund's seven-day yield on January 31, 1998, was 2.91%, compared
to 2.89% 12 months ago. The more recent seven-day yield was the
equivalent of a 5.17% taxable rate of return for Massachusetts
investors in the 43.68% combined state and federal income tax bracket.
Through January 31, 1998, the fund's 12-month total return was 3.10%,
compared to 3.07% for the Massachusetts tax-free money market funds
average, according to IBC Financial Data, Inc.
Q. WHAT'S YOUR OUTLOOK?
A. I think the Fed may become analogous to a hung jury in next few
months. On the one hand, the strength of the economy and the tight
labor markets make a strong case for the Fed to raise rates to head
off inflation caused by wage pressures. On the other hand, the Asian
crisis creates reasonable doubt. So much doubt, in fact, that the Fed
may want to lower rates to offset the downward pricing pressures
created by the cheapening of Asian goods - and the possible negative
effects that condition may have on U.S. corporate earnings. I think
the powerful arguments on each side will keep the Fed on the
sidelines, leaving interest rates in a state of equilibrium.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO
MANAGER ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON
THE COVER. THE MANAGER'S VIEWS ARE SUBJECT TO CHANGE AT ANY TIME BASED
ON MARKET AND OTHER CONDITIONS.
FUND FACTS
GOAL: HIGH CURRENT TAX-FREE
INCOME FOR MASSACHUSETTS
RESIDENTS WHILE MAINTAINING
A STABLE $1.00 SHARE PRICE
FUND NUMBER: 074
TRADING SYMBOL: FDMXX
START DATE: NOVEMBER 11, 1983
SIZE: AS OF JANUARY 31, 1998,
MORE THAN $1.1 BILLION
MANAGER: SCOTT ORR, SINCE
NOVEMBER 1997; MANAGER,
VARIOUS FIDELITY AND SPARTAN
MUNICIPAL MONEY MARKET
FUNDS; JOINED FIDELITY IN 1989
(CHECKMARK)
FIDELITY MASSACHUSETTS MUNICIPAL MONEY MARKET FUND
INVESTMENT CHANGES
MATURITY DIVERSIFICATION
DAYS % OF FUND ASSETS % OF FUND ASSETS % OF FUND ASSETS
1/31/98 7/31/97 1/31/97
0 - 30 71 70 70
31 - 90 13 16 11
91 - 180 7 4 9
181 - 397 9 10 10
WEIGHTED AVERAGE MATURITY
1/31/98 7/31/97 1/31/97
FIDELITY MASSACHUSETTS MUNICIPAL 49 DAYS 46 DAYS 51 DAYS
MONEY MARKET
MASSACHUSETTS TAX-FREE 50 DAYS 47 DAYS 50 DAYS
MONEY MARKET FUNDS AVERAGE*
ASSET ALLOCATION (% OF FUND'S INVESTMENTS)
AS OF JANUARY 31, 1998 AS OF JULY 31, 1997
ROW: 1, COL: 1, VALUE: 2.0
ROW: 1, COL: 2, VALUE: 17.0
ROW: 1, COL: 3, VALUE: 3.0
ROW: 1, COL: 4, VALUE: 20.0
ROW: 1, COL: 5, VALUE: 58.0
VARIABLE RATE DEMAND
NOTES (VRDNS) 59%
COMMERCIAL PAPER
(INCLUDING CP MODE) 16%
TENDER BONDS 2%
MUNICIPAL NOTES 22%
OTHER 1%
VARIABLE RATE DEMAND
NOTES (VRDNS) 60%
COMMERCIAL PAPER
(INCLUDING CP MODE) 20%
TENDER BONDS 2%
MUNICIPAL NOTES 17%
OTHER 1%
ROW: 1, COL: 1, VALUE: 2.0
ROW: 1, COL: 2, VALUE: 22.0
ROW: 1, COL: 3, VALUE: 3.0
ROW: 1, COL: 4, VALUE: 16.0
ROW: 1, COL: 5, VALUE: 57.0
*SOURCE: IBC'S MONEY FUND REPORT(registered trademark)
FIDELITY MASSACHUSETTS MUNICIPAL MONEY MARKET FUND
INVESTMENTS JANUARY 31, 1998
SHOWING PERCENTAGE OF TOTAL VALUE OF INVESTMENT IN SECURITIES
MUNICIPAL SECURITIES (A) - 100%
PRINCIPAL VALUE
AMOUNT (NOTE 1)
MASSACHUSETTS - 99.3%
Agawam Gen. Oblig. BAN 4% 2/5/99 $ 5,900,000 $ 5,920,414
Amherst-Pelham Reg'l. School Dist. BAN 4.45% 5/21/98 2,000,000
2,001,947
Ashland Gen. Oblig. BAN 4.04% 3/5/98 2,500,000 2,500,082
Barnstable Gen. Oblig. BAN:
4% 6/18/98& Trust Co. 5,500,000 5,502,972
4.25% 10/23/98 6,300,000 6,316,592
Bolton Gen. Oblig. BAN 4.50% 4/17/98 3,000,000 3,002,367
Boston Gen. Oblig. Series 1998 A, 4.50% 1/1/99 (FGIC Insured)
2,295,000 2,313,338
Boston Ind. Rev. (New Boston Seafood Center) Series 1997,
3.50%, LOC BankBoston, NA, VRDN (b) 875,000 875,000
Boston Wtr. & Swr. Participating VRDN, Series 1996 SG-75,
3.60% (Liquidity Facility Societe Generale) (c) 8,380,000 8,380,000
Brockton Area Tran. Auth. RAN 4.25% 7/17/98 4,000,000 4,005,600
Brookline Gen. Oblig. BAN:
4% 6/4/98 5,600,000 5,604,529
4% 12/16/98 3,500,000 3,509,446
Chatham BAN 4.25% 7/22/98 5,000,000 5,007,191
Cohasset Gen. Oblig. BAN 3.75% 10/1/98 3,814,750 3,818,870
Easton Gen. Oblig. BAN 4% 3/13/98 6,900,000 6,901,560
Fall River Gen. Oblig. BAN 4.25% 8/14/98
(BPA Fleet Nat'l. Bank) 2,300,000 2,304,107
Framingham Ind. Rev. Board (Perini Corp. Proj.) Series 1985,
3.65%, LOC Harris Trust & Savings Bank, Chicago, VRDN 400,000
400,000
Georgetown BAN 4% 6/12/98, LOC State Street Bank &
Trust Co., Boston 12,560,000 12,567,799
Gloucester Gen. Oblig. BAN 4% 8/7/98 4,000,000 4,002,967
Holliston Gen. Oblig. BAN 4.25% 10/15/98 3,000,000 3,008,290
Hopkinton Gen. Oblig. BAN:
4% 9/9/98 3,600,000 3,604,633
4.25% 9/9/98 4,000,000 4,008,583
Ipswich Gen. Oblig. BAN 4.25% 6/25/98 4,000,000 4,006,143
Kingston Gen. Oblig. BAN 4.25% 11/25/98 10,200,000 10,235,953
Lynn Wtr. & Swr. Commission Gen. Rev. Participating VRDN,
Series 1997 A, 3.65% (Liquidity Facility Merrill
Lynch & Co., Inc.) (c) 2,740,000 2,740,000
Mansfield Gen. Oblig. BAN 4.25% 11/19/98 3,000,000 3,008,973
Marlborough Gen. Oblig. BAN 4.25% 6/25/98 3,000,000 3,004,577
Massachusetts Bay Trans. Auth. Rev.:
Participating VRDN Series 1995 A, 3.60%
(Liquidity Facility Societe Generale) (c) 8,900,000 8,900,000
RAN:
Series D, 5% 3/1/98 2,910,000 2,912,737
Series 1997 A, 4.25% 2/27/98 18,040,000 18,047,580
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Massachusetts Bay Trans. Auth. Rev.: - continued
Series C, CP:
3.75% 2/19/98, LOC Westdeutsche Landesbank
Giron $ 3,800,000 $ 3,800,000
3.80% 2/25/98, LOC Westdeutsche Landesbank
Giron 7,000,000 7,000,000
3.50% 4/7/98, LOC Westdeutsche Landesbank
Giron 1,800,000 1,800,000
Massachusetts Gen. Oblig. Consolidated Loan:
Bonds Series A, 4% 1/1/99 6,300,000 6,320,043
Participating VRDN (c):
Series 1996 SG-38, 3.60% (Liquidity Societe
Generale) 5,000,000 5,000,000
Series 1997 B, 3.65% (Liquidity Facility Merrill
Lynch & Co., Inc.) 11,100,000 11,100,000
Series 1997 C, 3.65% (Liquidity Facility Merrill
Lynch & Co., Inc.) 3,695,000 3,695,000
Series 96C2101, 3.68% (Liquidity Facility
Citibank, NY) 4,700,000 4,700,000
Massachusetts Gen. Oblig. Rev.:
Bonds Series 1997 A, 4.25% 3/1/98 7,000,000 7,002,861
Participating VRDN (c):
Rfdg.:
Series 1997 A, 3.55% (Liquidity Facility Bankers
Trust Co.) 6,100,000 6,100,000
3.50% (Liquidity Facility Bankers Trust Co.) 9,300,000 9,300,000
Series 1993 A:
3.63%, (Liquidity Facility Citibank, NY) 5,800,000 5,800,000
3.63%, (Liquidity Facility Citibank, NY) 3,800,000 3,800,000
Series SG-47, 3.60% (Liquidity Facility Societe
Generale) 5,800,000 5,800,000
Series 1997 B, 3.40% (BPA Landesbank
Hessen-Thuringen) VRDN 35,300,000 35,300,000
Massachusetts Health & Ed. Facs. Auth.:
Bonds:
(Boston Univ.) Series H, 3.50%, tender 4/1/98,
LOC Landesbank Hessen-Thuringen 17,800,000 17,800,000
(Harvard Univ.) CP mode:
3.50% 4/7/98 2,000,000 2,000,000
3.65% 2/11/98 1,250,000 1,250,000
3.70% 2/17/98 2,600,000 2,600,000
3.75% 2/20/98 3,400,000 3,400,000
3.75% 2/20/98 10,300,000 10,300,000
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Massachusetts Health & Ed. Facs. Auth.: - continued
Bonds: - continued
(Partners Healthcare Sys.):
3.75% 2/24/98, CP mode $ 3,400,000 $ 3,400,000
Series 1997 A, 4.50% 7/1/98 (FSA Insured) 3,000,000 3,008,429
Participating VRDN (c):
Series1997 Y, 3.60% (Liquidity Facility CoreStates
Bank) 6,500,000 6,500,000
Series SG-27, 3.60% (Liquidity Facility Societe
Generale) 6,500,000 6,500,000
VRDN:
(Berklee College of Music) Series D, 3.25% (MBIA Insured)
(BPA Credit Swiss First Boston) 7,800,000 7,800,000
(Brandeis Univ.) Series H, 3.40%, LOC Fleet
Nat'l. Bank 5,385,000 5,385,000
(Brigham & Women's Hosp.) Series A, 3.50%,
LOC Sanwa Bank 1,000,000 1,000,000
(Cap. Asset Prog.) Series 1985 D, 3.55% (MBIA Insured)
(BPA Credit Swiss First Boston) 11,500,000 11,500,000
(Hallmark Health Sys.) Series 1988 B, 3.40%
(BPA Fleet Nat'l. Bank) 14,500,000 14,500,000
(Harvard Univ.):
Series I:
3.35% 12,000,000 12,000,000
3.35% 47,086,000 47,086,000
Series Q-1, 3.35% 1,700,000 1,700,000
(Massachusetts Institute of Technology) Series G,
3.20% 1,000,000 1,000,000
(Mount Ida College) 3.50%, LOC Chase Manhattan
Bank 3,600,000 3,600,000
(Partners Healthcare Sys.):
Series P-1, 3.25% (Liquidity Facility Bayerische
Landesbank Girozentrale) 26,700,000 26,700,000
Series P-2, 3.25% (Liquidity Facility Bayerische
Landesbank Girozentrale) 18,800,000 18,800,000
Massachusetts Hsg. Fin. Agcy.:
Multi-Family Hsg. Rev.:
Rfdg. Series 1995 A, 3.45%, (BPA Republic Bank of
New York) VRDN (GNMA Guaranteed) 57,255,000 57,255,000
(Princeton Crossing Proj.) Series 1996, 3.50%,
LOC General Elec. Capital Corp., VRDN (b) 13,700,000 13,700,000
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Massachusetts Hsg. Fin. Agcy.: - continued
Participating VRDN (c):
Series PA-83, 3.70% (Liquidity Facility Merrill Lynch
& Co. Inc.) (b) $ 5,920,000 $ 5,920,000
Series PA-132, 3.70% (Liquidity Facility Merrill Lynch
& Co., Inc.) (b) 1,225,000 1,225,000
Series PT-33, 3.65% (Liquidity Facility Banque Nationale
de Paris) (b) 5,180,000 5,180,000
Series PT-42, 3.65% (Liquidity Facility Commerzbank,
Germany) 5,080,000 5,080,000
Series 13-C, 3.40% (Liquidity Facility Morgan Guaranty
Trust Co.) 5,800,000 5,800,000
Single Family Hsg. Rev. Bonds Series 50, 3.90%,
tender 6/1/98 3,400,000 3,400,000
Massachusetts Ind. Fin. Agcy. Ind. Dev. Rev.:
Participating VRDN (c):
(Phillips Academy) 3.60% (Liquidity Facility Societe
Generale) 6,000,000 6,000,000
Series 1996 SG-56, 3.60% (Liquidity Facility Societe
Generale) 11,100,000 11,100,000
Rfdg., VRDN:
(Brady Enterprises) Series 1996, 3.60%, LOC Fleet Nat'l.
Bank 2,300,000 2,300,000
(First Healthcare Corp. Proj.):
Series 1992 A, 3.55%, LOC Wachovia Bank of
Georgia 2,025,000 2,025,000
Series 1993 B, 3.55%, LOC Wachovia Bank of
Georgia 700,000 700,000
(First Healthcare Corp. for Hillhaven Proj.) 3.55%, LOC
Wachovia Bank of Georgia 2,000,000 2,000,000
(WGBH Ed. Foundation Proj.) Series 1992, 3.40%,
LOC Nat'l. Westminster Bank PLC 4,575,000 4,575,000
VRDN:
(Abbott Box Co.) Series 1997, 3.60%, LOC Fleet
Nat'l. Bank (b) 3,800,000 3,800,000
(BBB Esq. LLC) Series 1996, 3.50%, LOC BankBoston,
NA (b) 1,100,000 1,100,000
(Baker School Specialty Co. Inc.) Series 1996, 3.60%,
LOC BankBoston, NA 3,160,000 3,160,000
(Barker Steel Co.) Series 1995, 3.60%, LOC State Street
Bank & Trust Co., Boston (b) 1,000,000 1,000,000
(Battery Engineering, Inc.) Series 1996, 3.90%, LOC
Bank of Tokyo-Mitsubishi (b) 1,600,000 1,600,000
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Massachusetts Ind. Fin. Agcy. Ind. Dev. Rev.: - continued
VRDN: - continued
(Bradford College) Series 1995 A, 3.40%, LOC
BankBoston, NA $ 1,700,000 $ 1,700,000
(Buckingham Browne Nichols School) 3.35%,
LOC State Street Bank & Trust Co., Boston 4,000,000 4,000,000
(Canton/Cedar Reality LLC 1997) 3.60%, LOC Fleet
Nat'l. Bank (b) 2,000,000 2,000,000
(Carand Reality Trust 1997) 3.50%, LOC State Street
Bank & Trust Co., Boston (b) 1,000,000 1,000,000
(Decas Cranberry Project 1997) 3.60%, LOC Fleet
Nat'l. Bank (b) 4,500,000 4,500,000
(Dover Instrument Corp.) Series 1997, 3.60%, LOC Fleet
Nat'l. Bank (b) 3,000,000 3,000,000
(Edgewood Retirement Commty.) Series 1995 C, 3.50%,
LOC Dresdner Bank, AG 400,000 400,000
(Falmouth Assisted Living) Series 1995, 3.35%,
LOC BankBoston, NA 4,100,000 4,100,000
(Fessenden School Issue) Series 1997, 3.50%, LOC
Fleet Nat'l. Bank 4,405,000 4,405,000
(General Signal Proj.):
3.55%, LOC Wachovia Bank of Georgia 1,100,000 1,100,000
3.55%, LOC Wachovia Bank of Georgia 7,500,000 7,500,000
(Gordon College Issue) Series 1997, 3.35%, LOC State
Street Bank & Trust Co., Boston 3,600,000 3,600,000
(Governor Dummer Academy) Series 1996, 3.35%, LOC
State Street Bank & Trust Co., Boston 1,800,000 1,800,000
(Hazen Paper Proj.) Series1996, 3.50%, LOC
BankBoston, NA (b) 1,500,000 1,500,000
(Heritage at Dartmouth) Series 1996, 3.45%, LOC
BankBoston, NA (b) 1,000,000 1,000,000
(Heritage at Hingham) Series 1997, 3.45%, LOC Fleet
Nat'l. Bank (b) 3,890,000 3,890,000
(Interpolymer Corp.) Series 1992, 3.80%, LOC
BankBoston, NA 3,200,000 3,200,000
(Jewish Geriatric Svs.) 3.50%, LOC BankBoston, NA (b) 3,000,000
3,000,000
(KMS Cos.) 3.50%, LOC State Street Bank & Trust Co.,
Boston (b) 2,300,000 2,300,000
(Lower Mills Associates II L.P.) Series 1995, 3.30%,
LOC BankBoston, NA 930,000 930,000
(Longview Fiber Co.) Series 1987, 3.50%, LOC
ABN-AMRO Bank, NV 2,070,000 2,070,000
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Massachusetts Ind. Fin. Agcy. Ind. Dev. Rev.: - continued
VRDN: - continued
(Mary Ann Morse Nursing Home):
Series 1994A, 3.80%, LOC ABN-AMRO Bank $ 5,800,000 $ 5,800,000
Series 1994 B, 3.30%, LOC ABN-AMRO Bank 6,800,000 6,800,000
(Mount Ida College) Series 1997, 3.35%, LOC
Credit Local de France 3,600,000 3,600,000
(Nutramax Products) Series 1996, 3.50%, LOC
BankBoston, NA (b) 2,800,000 2,800,000
(Parker-Hannifin Corp. Proj.) Series 1997, 3.65%,
LOC Wachovia Bank, NA 2,700,000 2,700,000
(Riverdale Mills Corp.) Series 1995, 3.50%, LOC
BankBoston, NA (b) 3,800,000 3,800,000
(Society of Prevention of Cruelty to Animals) Series 1997,
3.40%, LOC Fleet Nat'l. Bank 3,900,000 3,900,000
(Southern New England School of Law) 3.50%,
LOC Fleet Nat'l Bank 1,895,000 1,895,000
(United Medical Corp.) Series 1992, 3.40%, LOC
Chase Manhattan Bank (b) 1,300,000 1,300,000
(United Plastics 1997) 3.60%, LOC Fleet Nat'l. Bank (b) 2,200,000
2,200,000
(Univ. LLC) Series 1996, 3.50%, LOC BankBoston, NA (b) 2,000,000
2,000,000
(Wheelock College) Series A, 3.40%, LOC Nat'l.
Westminster Bank 4,200,000 4,200,000
(Youville Place Inc.) Series 1996, 3.40% (AMBAC Insured)
(BPA Fleet Nat'l. Bank) 5,300,000 5,300,000
Massachusetts Ind. Fin. Agcy. Poll. Cont. Rev.:
Rfdg. Bonds (New England Power Co. Proj.):
Series 1992 B, CP mode:
3.65% 2/9/98 5,200,000 5,200,000
3.60% 2/23/98 11,700,000 11,700,000
3.55% 4/1/98 6,000,000 6,000,000
3.50% 4/7/98 9,600,000 9,600,000
3.55% 4/8/98 4,600,000 4,600,000
Series 1993 A, CP mode:
3.60% 2/25/98 5,100,000 5,100,000
3.60% 2/27/98 1,700,000 1,700,000
3.50% 4/2/98 6,900,000 6,900,000
3.60% 4/8/98 1,000,000 1,000,000
3.55% 6/9/98 3,500,000 3,500,000
3.55% 6/10/98 2,500,000 2,500,000
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Massachusetts Ind. Fin. Agcy. Poll. Cont. Rev.: - continued
Rfdg. Bonds (New England Power Co. Proj.):
Series 1993 B, CP mode:
3.80% 2/24/98 $ 4,300,000 $ 4,300,000
3.60% 2/25/98 7,600,000 7,600,000
3.60% 2/27/98 3,600,000 3,600,000
3.55% 4/8/98 3,300,000 3,300,000
3.60% 6/8/98 5,300,000 5,300,000
VRDN:
(New England Power Co. Proj.) Series 1992 B 3.50% 1,000,000
1,000,000
(Holyoke Wtr. Pwr. Co. Proj.) Series 1990, 3.35%,
LOC Swiss Bank (b) 7,700,000 7,700,000
Massachusetts Ind. Fin. Agcy. Resource Recovery Rev.
(Ogden-Haverhill Proj.) Series 1986 B, 3.40%,
LOC Union Bank of Switzerland, VRDN (b) 14,425,000 14,425,000
Massachusetts Muni. Wholesale Elec. Co. Pwr. Supply Sys.
Rev. Series 1994 C, 3.25% (MBIA Insured)
LOC Credit Swiss First Boston, VRDN 18,500,000 18,500,000
Massachusetts Participating VRDN (c):
Series 93-I, 3.68% (Liquidity Facility Citibank, NY) 13,000,000
13,000,000
Series 93-2, 3.45% (Liquidity Facility State Street
Bank & Trust Co., Boston) 19,000,000 19,000,000
Massachusetts Port Auth. Rev.:
Participating VRDN Series 1997 B, 3.70%
(Liquidity Facility Societe Generale) (b)(c) 5,300,000 5,300,000
Series 1995 B, 3.65%, LOC Landesbanken
Hessen-Thuringen, VRDN (b) 12,370,000 12,370,000
Series 1996, 3.40% 4/7/98, LOC Canadian Imperial
Bank of Commerce, CP (b) 3,500,000 3,500,000
Series 1997, CP:
3.55% 2/27/98, LOC Canadian Imperial Bank
of Commerce (b) 1,000,000 1,000,000
3.50% 3/11/98, LOC Canadian Imperial Bank
of Commerce (b) 1,000,000 1,000,000
3.70% 4/20/98, LOC Canadian Imperial Bank
of Commerce (b) 5,500,000 5,500,000
Massachusetts Reg'l. Transit Auth. RAN 4.25% 6/26/98 4,000,000
4,005,273
Massachusetts Tpk. Auth. Participating VRDN (c):
Series PA-181, 3.65% (Liquidity Facility Merrill Lynch
& Co., Inc.) 3,740,000 3,740,000
Series PT-135, 3.65% (Liquidity Facility Banco
Santander, SA) 10,300,000 10,300,000
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Massachusetts Tpk. Auth. Participating VRDN: - continued
Series 1997 B, 3.65% (Liquidity Facility Merrill Lynch
& Co., Inc.) $ 7,000,000 $ 7,000,000
Series 1997 N, 3.71% (Liquidity Facility Bank of America
Nat'l Trust & Savings, SF) 6,000,000 6,000,000
Massachusetts Wtr. Resource Auth.:
CP:
3.70% 2/13/98, LOC Morgan Guaranty Trust Co., NY 4,000,000
4,000,000
3.65% 2/17/98, LOC Morgan Guaranty Trust Co., NY 7,000,000
7,000,000
3.80% 2/18/98, LOC Morgan Guaranty Trust Co., NY 7,000,000
7,000,000
3.75% 2/23/98, LOC Morgan Guaranty Trust Co., NY 11,000,000
11,000,000
3.70% 3/11/98, LOC Morgan Guaranty Trust Co., NY 3,100,000
3,100,000
3.40% 3/26/98, LOC Morgan Guaranty Trust Co., NY 3,000,000
3,000,000
3.45% 4/1/98, LOC Morgan Guaranty Trust Co., NY 2,400,000
2,400,000
3.45% 4/2/98, LOC Morgan Guaranty Trust Co., NY 8,250,000
8,250,000
3.45% 4/3/98, LOC Morgan Guaranty Trust Co., NY 14,300,000
14,300,000
3.40% 4/6/98, LOC Morgan Guaranty Trust Co., NY 5,200,000
5,200,000
3.45% 4/6/98, LOC Morgan Guaranty Trust Co., NY 14,700,000
14,700,000
3.75% 4/8/98, LOC Morgan Guaranty Trust Co., NY 3,500,000
3,500,000
3.75% 4/9/98, LOC Morgan Guaranty Trust Co., NY 12,400,000
12,400,000
3.75% 5/14/98, LOC Morgan Guaranty Trust Co., NY 6,000,000
6,000,000
3.60% 6/2/98, LOC Morgan Guaranty Trust Co., NY 3,800,000
3,800,000
(Multi-Modal Subordinated Gen. Rev.) VRDN:
Series 1997-A, 3.25% (Liquidity Facility Bank of Nova
Scotia) (AMBAC Insured) 30,700,000 30,700,000
Series 1997-B, 3.25% (Liquidity Facility Bank of Nova
Scotia) (AMBAC insured) 27,400,000 27,400,000
Participating VRDN (c):
Series 1995 SG-17, 3.60% (Liquidity Facility Societe
Generale) 5,000,000 5,000,000
Series 1996, SG-63 3.60% (Liquidity Facility Societe
Generale) 1,000,000 1,000,000
Merrimack Valley Reg'l. Transit Auth. RAN 4.25% 6/19/98 3,600,000
3,604,313
New Bedford Gen. Oblig. BAN 4.30% 6/30/98
(BPA Fleet Nat'l. Bank) 1,600,000 1,602,531
Northampton Gen. Oblig. BAN 4.25% 12/22/98 3,600,000 3,613,843
Northborough Gen. Oblig. BAN 4% 2/2/99 3,250,000 3,262,220
Northborough Ind. Rev. (Tru Realty Corp. Proj. Toys "R" Us,
Inc) 3.575%, LOC Chase Manhattan Bank, VRDN 2,900,000 2,900,000
Seekonk Gen. Oblig. BAN 4.25% 11/19/98 5,370,000 5,387,725
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Southeastern Reg'l. Transit Auth. RAN 4.25% 9/18/98 $ 3,600,000 $
3,607,587
Springfield Gen. Oblig. BAN:
4.40% 6/26/98 (BPA Fleet Nat'l. Bank) 2,000,000 2,003,434
4.40% 9/4/98 (BPA Fleet Nat'l. Bank) 4,200,000 4,211,883
4.25% 11/20/98 (BPA Fleet Nat'l. Bank) 7,200,000 7,222,179
4.25% 11/20/98 (BPA Fleet Nat'l. Bank) 6,000,000 6,018,491
Uxbridge Gen. Oblig. BAN 4.25% 7/15/98 4,000,000 4,006,900
Walpole Gen. Oblig. BAN:
4.15% 6/3/98 1,800,000 1,801,738
Series 1997, 4% 12/16/98 5,700,000 5,710,535
West Springfield BAN 3.75% 3/5/98 13,300,000 13,301,679
Westfield Gen. Oblig. BAN 4.10% 3/26/98 2,000,000 2,000,412
Weston Gen. Oblig. BAN 4% 9/30/98 5,000,000 5,005,396
1,173,220,722
PUERTO RICO - 0.7%
Puerto Rico Commonwealth Infrastructure Fin. Auth.
Participating VRDN, Series 1997 A, 3.45%
(Liquidity Facility CoreStates Bank) (c) 6,200,000 6,200,000
Puerto Rico Elec. Pwr. Auth. Pwr. Rev. Bonds Participating
VRDN, Series AA, 3.45% (Liquidity Facility Societe
Generale France) (c) 2,200,000 2,200,000
8,400,000
TOTAL INVESTMENTS - 100% $ 1,181,620,722
Total Cost for Income Tax Purposes $ 1,181,620,747
SECURITY TYPE ABBREVIATIONS
BAN - Bond Anticipation Notes
CP - Commercial Paper
RAN - 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.
3. Provides evidence of ownership in one or more underlying municipal
bonds.
INCOME TAX INFORMATION
At January 31, 1998, the fund had a capital loss carryforward of
approximately $66,000 of which $13,000 and $53,000 will expire on
January 31, 2003 and 2005, respectively.
FIDELITY MASSACHUSETTS MUNICIPAL MONEY MARKET FUND
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
JANUARY 31, 1998
ASSETS
INVESTMENT IN SECURITIES, AT VALUE $ 1,181,620,722
- -
SEE ACCOMPANYING SCHEDULE
CASH 22,939
RECEIVABLE FOR INVESTMENTS SOLD 11,404,123
SHARE TRANSACTIONS IN PROCESS 11,928,229
INTEREST RECEIVABLE 8,270,011
TOTAL ASSETS 1,213,246,024
LIABILITIES
PAYABLE FOR INVESTMENTS $ 13,001,504
PURCHASED
DISTRIBUTIONS PAYABLE 50,759
ACCRUED MANAGEMENT FEE 381,838
OTHER PAYABLES AND ACCRUED 265,410
EXPENSES
TOTAL LIABILITIES 13,699,511
NET ASSETS $ 1,199,546,513
NET ASSETS CONSIST OF:
PAID IN CAPITAL $ 1,199,612,732
ACCUMULATED NET REALIZED GAIN (66,219)
(LOSS) ON INVESTMENTS
NET ASSETS, FOR 1,199,523,604 $ 1,199,546,513
SHARES OUTSTANDING
NET ASSET VALUE, OFFERING PRICE $1.00
AND REDEMPTION PRICE PER
SHARE ($1,199,546,513 (DIVIDED BY)
1,199,523,604 SHARES)
STATEMENT OF OPERATIONS
YEAR ENDED JANUARY 31, 1998
INTEREST INCOME $ 38,640,580
EXPENSES
MANAGEMENT FEE $ 4,125,689
TRANSFER AGENT FEES 1,642,373
CUSTODIAN FEES AND EXPENSES 56,984
NON-INTERESTED TRUSTEES' 4,999
COMPENSATION
ACCOUNTING FEES AND EXPENSES 156,824
REGISTRATION FEES 72,323
AUDIT 33,026
LEGAL 7,407
TOTAL EXPENSES BEFORE 6,099,625
REDUCTIONS
EXPENSE REDUCTIONS (4,748) 6,094,877
NET INTEREST INCOME 32,545,703
REALIZED AND UNREALIZED GAIN 3,832
(LOSS)
NET REALIZED GAIN (LOSS) ON
INVESTMENT SECURITIES
INCREASE (DECREASE) IN NET (5,055)
UNREALIZED GAIN FROM
ACCRETION
OF DISCOUNT
NET GAIN (LOSS) (1,223)
NET INCREASE IN NET ASSETS $ 32,544,480
RESULTING FROM OPERATIONS
OTHER INFORMATION
EXPENSE REDUCTION $ 3,614
CUSTODIAN CREDITS
TRANSFER AGENT CREDITS 1,134
$ 4,748
STATEMENT OF CHANGES IN NET ASSETS
YEAR ENDED YEAR ENDED
JANUARY 31, JANUARY 31,
1998 1997
INCREASE (DECREASE) IN NET
ASSETS
OPERATIONS $ 32,545,703 $ 25,070,453
NET INTEREST INCOME
NET REALIZED GAIN (LOSS) 3,832 (51,705)
INCREASE (DECREASE) IN NET (5,055) 5,055
UNREALIZED GAIN FROM
ACCRETION OF MARKET DISCOUNT
NET INCREASE (DECREASE) IN 32,544,480 25,023,803
NET ASSETS RESULTING
FROM OPERATIONS
DISTRIBUTIONS TO SHAREHOLDERS (32,545,703) (25,070,453)
FROM NET INTEREST INCOME
SHARE TRANSACTIONS AT NET ASSET 3,380,459,506 2,699,539,513
VALUE OF $1.00 PER SHARE
PROCEEDS FROM SALES OF SHARES
REINVESTMENT OF DISTRIBUTIONS 31,602,703 24,416,904
FROM NET INTEREST INCOME
COST OF SHARES REDEEMED (3,180,203,918) (2,603,710,474)
NET INCREASE (DECREASE) IN 231,858,291 120,245,943
NET ASSETS AND SHARES
RESULTING FROM SHARE
TRANSACTIONS
TOTAL INCREASE (DECREASE) IN 231,857,068 120,199,293
NET ASSETS
NET ASSETS
BEGINNING OF PERIOD 967,689,445 847,490,152
END OF PERIOD $ 1,199,546,513 $ 967,689,445
FINANCIAL HIGHLIGHTS
YEARS ENDED JANUARY 31,
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
1998 1997 1996 1995 1994
SELECTED
PER-SHARE
DATA
NET ASSET VALUE, $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
BEGINNING
OF PERIOD
INCOME FROM .031 .029 .032 .023 .017
INVESTMENT
OPERATIONS
NET INTEREST
INCOME
LESS DISTRIBUTIONS
FROM NET (.031) (.029) (.032) (.023) (.017)
INTEREST INCOME
NET ASSET VALUE, $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
END OF PERIOD
TOTAL RETURN 3.10% 2.90% 3.20% 2.29% 1.71%
RATIOS AND
SUPPLEMENTAL
DATA
NET ASSETS, END $ 1,199,547 $ 967,689 $ 847,490 $ 756,929 $ 610,154
OF PERIOD
(000 OMITTED)
RATIO OF EXPENSES .57% .59% .60% .63% .66%
TO AVERAGE
NET ASSETS
RATIO OF NET 3.07% 2.86% 3.15% 2.28% 1.69%
INTEREST INCOME
TO AVERAGE NET
ASSETS
</TABLE>
SPARTAN MASSACHUSETTS MUNICIPAL MONEY MARKET FUND
PERFORMANCE: THE BOTTOM LINE
To measure a money market fund's performance, you can look at either
total return or yield. Total return reflects the change in the value
of an investment, assuming reinvestment of the fund's dividend income,
and the effect of the fund's $5 account closeout fee on an average
size account. Yield measures the income paid by a fund. Since a money
market fund tries to maintain a $1 share price, yield is an important
measure of performance. If Fidelity had not reimbursed certain fund
expenses, the past five years and life of fund total returns would
have been lower.
CUMULATIVE TOTAL RETURNS
PERIODS ENDED JANUARY 31, 1998 PAST 1 PAST 5 LIFE OF
YEAR YEARS FUND
SPARTAN MA MUNI MONEY MARKET 3.19% 14.67% 22.14%
MASSACHUSETTS TAX-FREE MONEY MARKET 3.07% 14.16% 20.39%
FUNDS AVERAGE
CUMULATIVE TOTAL RETURNS show the fund's performance in percentage
terms over a set period - in this case, one year, five years or since
the fund started on March 4, 1991. For example, if you had invested
$1,000 in a fund that had a 5% return over the past year, the value of
your investment would be $1,050. To measure how the fund's performance
stacked up against its peers, you can compare it to the Massachusetts
tax-free money market funds average, which reflects the performance of
Massachusetts tax-free money market funds with similar objectives
tracked by IBC Financial Data, Inc. The past one year average
represents a peer group of 12 mutual funds. (The periods covered by
the IBC Financial Data, Inc. numbers are the closest available match
to those covered by the fund.)
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED JANUARY 31, 1998 PAST 1 PAST 5 LIFE OF
YEAR YEARS FUND
SPARTAN MA MUNI MONEY MARKET 3.19% 2.78% 2.93%
MASSACHUSETTS TAX-FREE MONEY MARKET 3.07% 2.68% 2.75%
FUNDS AVERAGE
AVERAGE ANNUAL TOTAL RETURNS take the fund's cumulative return and
show you what would have happened if the fund had performed at a
constant rate each year.
YIELDS
2/2/98 11/3/97 7/28/97 4/28/97 2/3/97
SPARTAN MASSACHUSETTS 3.04% 3.17% 3.17% 3.50% 3.02%
MUNICIPAL MONEY
MARKET FUND
MASSACHUSETTS 2.87% 3.02% 3.05% 3.45% 2.89%
TAX-FREE MONEY MARKET
FUNDS AVERAGE
SPARTAN MASSACHUSETTS 5.40% 5.63% 5.63% 6.21% 5.36%
MUNICIPAL MONEY MARKET
FUND - TAX-EQUIVALENT
YIELD refers to the income paid by the fund over a given period.
Yields for money market funds are usually for seven-day periods,
expressed as annual percentage rates. A yield that assumes income
earned is reinvested or compounded is called an effective yield. The
chart above shows the fund's current seven-day yield at quarterly
intervals over the past year. You can compare these yields to the
Massachusetts tax-free money market funds average. Or you can look at
the fund's tax-equivalent yield, which is based on a combined
effective 1997 federal and state income tax rate of 43.68%. Figures
for the Massachusetts tax-free money market funds average are from IBC
Financial Data, Inc. A portion of the fund's income may be subject to
the alternative minimum tax.
A MONEY MARKET FUND'S TOTAL RETURNS AND YIELDS WILL VARY, AND REFLECT
PAST RESULTS RATHER THAN PREDICT FUTURE PERFORMANCE.
COMPARING
PERFORMANCE
Yields on tax-free investments
are usually lower than yields
on taxable investments.
However, a straight
comparison between the two
may be misleading because
it ignores the way taxes
reduce taxable returns.
Tax-equivalent yield - the
yield you'd have to earn on a
similar taxable investment to
match the tax-free yield -
makes the comparison more
meaningful. Keep in mind that
the U.S. government neither
insures nor guarantees a
money market fund. In fact,
there is no assurance that a
money market fund will
maintain a $1 share price.
(checkmark)
SPARTAN MASSACHUSETTS MUNICIPAL MONEY MARKET FUND
FUND TALK: THE MANAGER'S OVERVIEW
NOTE TO SHAREHOLDERS: Scott Orr became Portfolio Manager of Spartan
Massachusetts Municipal Money Market Fund on November 1, 1997.
Q. SCOTT, WHAT WAS THE INVESTING ENVIRONMENT LIKE OVER THE PAST 12
MONTHS?
A. Economic strength persisted as real GDP - gross domestic product
adjusted for inflation - grew at a rate approaching 4% in 1997. In
addition, the unemployment rate for the year averaged 4.9%. Normally,
one may expect this combination of strong growth and a tight labor
market to spark inflation, but inflation was benign. Early in 1997,
the market expected an interest-rate increase by the Federal Reserve
Board, as the economy grew at a torrid pace. On March 25, 1997, the
Fed announced it had increased the fed funds rate - the rate banks
charge each other for overnight loans - from 5.25% to 5.50%. For the
next month or so, expectations were high that the Fed would continue
to raise rates. However, at its May meeting, the Fed decided to hold
off because economic growth had moderated and inflation was still
benign.
Q. WHAT'S HAPPENED SINCE THEN?
A. Inflation remained in check for the rest of the year, as economic
activity continued on a moderate to fairly strong track. Consequently,
the Fed opted to keep rates unchanged. It wasn't until mid-October
that several Fed officials made comments indicating that they were
again thinking of raising rates in order to slow the economy before
inflation emerged. However, that was before economic and market
turmoil hit Southeast Asia in late October and continued through the
end of the period. Some Fed officials felt that the continuation of
stronger-than-expected monthly employment reports would force wage
increases that could be passed on to the consumer - meaning inflation.
At the same time, the Asian situation caused concern that U.S. export
growth would weaken as Asian goods became increasingly cheaper.
Therefore, the co-existence of tight labor markets and the uncertainty
in Asia created an equilibrium that kept rates steady.
Q. WHAT WAS THE FUND'S STRATEGY DURING THIS 12-MONTH PERIOD?
A. A steady supply of one-year, fixed-rate Massachusetts municipal
notes throughout the year makes the Massachusetts market unique. To
take advantage of this situation, I bought these notes regularly,
laddering the maturities so that as some one-year notes matured, I
purchased more to replace them. This strategy kept the fund's average
maturity a bit longer than might be expected in some of the market
environments we've seen. For example, during the first half of the
period I was expecting the Fed to raise rates. In most cases, that
would mean the fund would have a shorter average maturity, holding
more variable-rate securities whose interest rates would float upward
in a rising rate environment. However, the plentiful supply of
Massachusetts one-year, fixed-rate notes made it more worthwhile to
purchase them because they were offering more attractive yields than
those offered in the shorter-term, variable-rate part of the market.
The fund's average maturity started the period at 52 days. For the
remainder of the period, the fund's average maturity remained in the
mid-40- to mid-50-day range - a neutral stance reflecting my
expectation of fairly stable rates for the next few months.
Q. HOW DID THE FUND PERFORM?
A. The fund's seven-day yield on January 31, 1998, was 3.01%, compared
to 2.99% 12 months ago. The more recent seven-day yield was the
equivalent of a 5.34% taxable rate of return for Massachusetts
investors in the 43.68% combined state and federal income tax bracket.
Through January 31, 1998, the fund's 12-month total return was 3.19%,
compared to 3.07% for the Massachusetts tax-free money market funds
average, according to IBC Financial Data, Inc.
Q. WHAT'S YOUR OUTLOOK?
A. On one hand, the strength of the economy and the tight labor
markets make a strong case for the Fed to raise rates to head off
inflation caused by wage pressures. On the other hand, the Asian
crisis creates reasonable doubt. So much doubt, in fact, that the Fed
may want to lower rates to offset the downward pricing pressures
created by the cheapening of Asian goods - and the possible negative
effects that condition may have on U.S. corporate earnings. I think
the powerful arguments on each side will keep the Fed on the
sidelines, leaving interest rates in a state of equilibrium.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO
MANAGER ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON
THE COVER. THE MANAGER'S VIEWS ARE SUBJECT TO CHANGE AT ANY TIME BASED
ON MARKET AND OTHER CONDITIONS.
FUND FACTS
GOAL: HIGH CURRENT TAX-FREE
INCOME FOR MASSACHUSETTS
RESIDENTS WHILE MAINTAINING
A STABLE $1.00 SHARE PRICE
FUND NUMBER: 426
TRADING SYMBOL: FMSXX
START DATE: MARCH 4, 1991
SIZE: AS OF JANUARY 31, 1998,
MORE THAN $744 MILLION
MANAGER: SCOTT ORR, SINCE
NOVEMBER 1997; MANAGER,
VARIOUS FIDELITY AND SPARTAN
MUNICIPAL MONEY MARKET FUNDS;
JOINED FIDELITY IN 1989
(CHECKMARK)
SPARTAN MASSACHUSETTS MUNICIPAL MONEY MARKET FUND
INVESTMENT CHANGES
MATURITY DIVERSIFICATION
DAYS % OF FUND ASSETS % OF FUND ASSETS % OF FUND ASSETS
1/31/98 7/31/97 1/31/97
0 - 30 68 68 67
31 - 90 14 17 12
91 - 180 8 5 10
181 - 397 10 10 11
WEIGHTED AVERAGE MATURITY
1/31/98 7/31/97 1/31/97
SPARTAN MASSACHUSETTS MUNICIPAL 54 DAYS 46 DAYS 52 DAYS
MONEY MARKET
MASSACHUSETTS TAX-FREE 50 DAYS 47 DAYS 50 DAYS
MONEY MARKET FUNDS AVERAGE*
ASSET ALLOCATION (% OF FUND'S INVESTMENTS)
AS OF JANUARY 31, 1998 AS OF JULY 31, 1997
ROW: 1, COL: 1, VALUE: 2.0
ROW: 1, COL: 2, VALUE: 19.0
ROW: 1, COL: 3, VALUE: 3.0
ROW: 1, COL: 4, VALUE: 21.0
ROW: 1, COL: 5, VALUE: 55.0
ROW: 1, COL: 1, VALUE: 2.6
ROW: 1, COL: 2, VALUE: 23.0
ROW: 1, COL: 3, VALUE: 2.6
ROW: 1, COL: 4, VALUE: 17.0
ROW: 1, COL: 5, VALUE: 55.0
VARIABLE RATE DEMAND
NOTES (VRDNS) 57%
COMMERCIAL PAPER
(INCLUDING CP MODE) 21%
TENDER BONDS 2%
MUNICIPAL NOTES 19%
OTHER 1%
VARIABLE RATE DEMAND
NOTES (VRDNS) 56%
COMMERCIAL PAPER
(INCLUDING CP MODE) 17%
TENDER BONDS 2%
MUNICIPAL NOTES 23%
OTHER 2%
*SOURCE: IBC'S MONEY FUND REPORT(registered trademark)
SPARTAN MASSACHUSETTS MUNICIPAL MONEY MARKET FUND
INVESTMENTS JANUARY 31, 1998
SHOWING PERCENTAGE OF TOTAL VALUE OF INVESTMENT IN SECURITIES
MUNICIPAL SECURITIES (A) - 100%
PRINCIPAL VALUE
AMOUNT (NOTE 1)
MASSACHUSETTS - 99.0%
Agawam Gen. Oblig. BAN 4% 2/5/99 $ 3,730,000 $ 3,742,906
Amherst-Pelham Reg'l. School Dist. BAN 4.45% 5/21/98 1,500,000
1,501,460
Ashland Gen. Oblig. BAN 4.04% 3/5/98 1,500,000 1,500,050
Barnstable Gen. Oblig. BAN:
4% 6/18/98 3,500,000 3,501,892
4.25% 10/23/98 4,090,000 4,100,756
Bolton BAN 4.50% 4/17/98 2,000,000 2,001,578
Boston Gen. Oblig. Series 1998 A, 4.50% 1/1/99
(FGIC Insured) 1,500,000 1,511,986
Boston Ind. Rev. (New Boston Seafood Center) Series 1997,
3.50%, LOC BankBoston, NA, VRDN (b) 600,000 600,000
Boston Wtr. & Swr. Participating VRDN, Series 1996 SG-75,
3.60% (Liquidity Facility Societe Generale) (c) 5,100,000 5,100,000
Brockton Area Tran. Auth. RAN 4.25% 7/17/98 3,000,000 3,004,200
Brookline Gen. Oblig. BAN:
4% 6/4/98 3,580,000 3,582,895
4% 12/16/98 4,000,000 4,008,884
Chatham BAN 4.25% 7/22/98 3,330,000 3,334,789
Cohasset Gen. Oblig. BAN 3.75% 10/1/98 2,400,000 2,402,592
Easton Gen. Oblig. BAN 4% 3/13/98 4,570,000 4,571,033
Fall River Gen. Oblig. BAN 4.25% 8/14/98
(BPA Fleet Nat'l. Bank) 1,480,000 1,482,642
Georgetown BAN 4% 6/12/98, LOC State Street Bank &
Trust Co., Boston, 8,000,000 8,004,967
Gloucester Gen. Oblig. BAN 4% 8/7/98 9,904,323 9,910,854
Holliston Gen. Oblig. BAN 4.25% 10/15/98 2,000,000 2,005,527
Hopkinton Gen. Oblig. BAN:
4% 9/9/98 2,400,000 2,403,089
4.25% 9/9/98 2,618,000 2,623,618
Ipswich Gen. Oblig. BAN 4.25% 6/25/98 3,000,000 3,004,607
Kingston Gen. Oblig. BAN 4.25% 11/25/98 6,720,000 6,743,687
Mansfield Gen. Oblig. BAN 4.25% 11/19/98 2,000,000 2,005,982
Marlborough Gen. Oblig. BAN 4.25% 6/25/98 2,000,000 2,003,051
Massachusetts Bay Tran. Auth.:
Participating VRDN Series 1995 A, 3.60%
(Liquidity Facility Societe Generale) (c) 8,385,000 8,385,000
RAN Series 1997 A, 4.25% 2/27/98 11,100,000 11,104,531
Series C, CP:
3.75% 2/19/98, LOC Westdeutsche Landesbank
Giron 2,500,000 2,500,000
3.80% 2/25/98, LOC Westdeutsche Landesbank
Giron 5,000,000 5,000,000
3.50% 4/7/98, LOC Westdeutsche Landesbank
Giron 1,200,000 1,200,000
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Massachusetts Gen. Oblig. Consolidated Loan:
Bonds Series A, 4% 1/1/99 $ 3,950,000 $ 3,962,567
Participating VRDN (c):
Series 1997 B, 3.65% (Liquidity Facility Merrill Lynch
& Co., Inc.) 7,260,000 7,260,000
Series 1997 C, 3.65% (Liquidity Facility Merrill Lynch
& Co., Inc.) 2,500,000 2,500,000
Series 96C2101, 3.68% (Liquidity Facility Citibank, NY) 2,800,000
2,800,000
Massachusetts Gen. Oblig. Rev.:
Bonds Series 1997 A, 4.25% 3/1/98 4,735,000 4,736,935
Participating VRDN (c):
Rfdg.:
Series 1997 A, 3.55% (Liquidity Facility Bankers
Trust Co.) 3,800,000 3,800,000
3.50% (Liquidity Facility Bankers Trust Co.) 8,815,000 8,815,000
Series 1993 A:
3.63% (Liquidity Facility Citibank, NY) 3,900,000 3,900,000
3.63% (Liquidity Facility Citibank, NY) 5,700,000 5,700,000
Series SG-47, 3.60% (Liquidity Facility Societe
Generale) 4,200,000 4,200,000
Series 1997 B, 3.40% (BPA Landesbank Hessen-
Thuringen) VRDN 6,700,000 6,700,000
Massachusetts Health & Ed. Facs. Auth. Rev.:
Bonds:
(Boston Univ.) Series H, 3.50%, tender 4/1/98,
LOC Landesbank Hessen-Thuringen 11,200,000 11,200,000
(Harvard Univ.) CP mode:
3.75% 2/20/98 2,200,000 2,200,000
3.75% 2/20/98 6,400,000 6,400,000
3.75% 2/24/98 2,200,000 2,200,000
(Partners Healthcare Sys.) Series 1997 A, 4.50%,
7/1/98 (FSA Insured) 2,000,000 2,005,171
Participating VRDN (c):
(Partners Healthcare Sys.) Series 1997 Y, 3.60%
(Liquidity Facility CoreStates Bank) 4,435,000 4,435,000
Series SG-27, 3.60% (Liquidity Facility Societe
Generale) 3,935,000 3,935,000
VRDN:
(Berklee College of Music) Series D, 3.25% (MBIA
Insured) (BPA Credit Swiss First Boston) 5,000,000 5,000,000
(Boston Children's Hosp.) 3.65% (BPA Sanwa
Bank Ltd.) 1,800,000 1,800,000
(Brandeis Univ.) Series H, 3.40%, LOC Fleet Nat'l. Bank 3,600,000
3,600,000
(Cap. Asset Prog.) Series 1985 D, 3.55% (MBIA Insured)
(BPA Credit Swiss First Boston) 7,800,000 7,800,000
(Harvard Univ.):
Series I:
3.35% 14,500,000 14,500,000
3.35% 8,116,000 8,116,000
Series Q-1, 3.35% 1,000,000 1,000,000
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Massachusetts Health & Ed. Facs. Auth. Rev.: - continued
VRDN: - continued
(Mount Ida College) 3.50%, LOC Chase Manhattan Bank $ 2,700,000 $
2,700,000
(Partners Healthcare Sys.):
Series P-1, 3.25% (Liquidity Facility Bayerische
Landesbank Girozentrale) 20,300,000 20,300,000
Series P-2, 3.25% (Liquidity Facility Bayerische
Landesbank Girozentrale) 15,600,000 15,600,000
(Wellesley College) Series E, 3.25% 4,300,000 4,300,000
(Williams College) 3.10% 5,500,000 5,500,000
Massachusetts Hsg. Fin. Agcy., VRDN:
Multi-Family Hsg. Rev.:
Rfdg. Series 1995 A, 3.40% (Fannie Mae Guaranteed) 4,200,000
4,200,000
(Harbour Point Dev.) Series 1995 A, 3.45%
(BPA Republic Bank of New York)
(GNMA Guaranteed) 33,600,000 33,600,000
(Princeton Crossing Proj.) Series 1996, 3.50%,
LOC General Elec. Capital Corp. (b) 8,700,000 8,700,000
Participating VRDN (c):
Series PA-132, 3.70% (Liquidity Facility Merrill
Lynch & Co., Inc.) (b) 1,000,000 1,000,000
Series PT-33, 3.65% (Liquidity Facility Banque
Nationale de Paris) (b) 1,500,000 1,500,000
Series PT-42, 3.65% (Liquidity Facility Commerzbank,
Germany) 3,905,000 3,905,000
Series 13-C, 3.40% (Liquidity Facility Morgan
Guaranty Trust Co.) 3,700,000 3,700,000
Single Family Hsg. Rev. Bonds:
Series 50, 3.90%, tender 6/1/98 2,000,000 2,000,000
3.80%, tender 3/1/98 (AMBAC Insured)
(Liquidity Facility Citibank, NY) (b)(d) 3,600,000 3,600,000
Massachusetts Ind. Fin. Agcy. Ind. Dev. Rev.:
Participating VRDN (c):
(Phillips Academy) 3.60% (Liquidity Facility Societe Generale)
3,755,000 3,755,000
Series 1996 SG-56, 3.60% (Liquidity Facility Societe Generale)
7,025,000 7,025,000
Rfdg., VRDN:
(Baker School Specialty Co. Inc.) Series 1996, 3.60%,
LOC BankBoston, NA 2,200,000 2,200,000
(Brady Enterprises) Series 1996, 3.60%, LOC Fleet
Nat'l. Bank 1,550,000 1,550,000
(First Healthcare Corp. for Hillhaven Proj.) 3.55%,
LOC Wachovia Bank of Georgia 1,195,000 1,195,000
(First Healthcare Corp. Proj.) Series 1992 B, 3.55%,
LOC Wachovia Bank of Georgia 1,130,000 1,130,000
(WGBH Ed. Foundation Proj.) Series 1992, 3.40%,
LOC Nat'l. Westminster Bank PLC 2,540,000 2,540,000
VRDN:
(Abbott Box Co.) Series 1997, 3.60%, LOC Fleet
Nat'l. Bank (b) 2,425,000 2,425,000
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Massachusetts Ind. Fin. Agcy. Ind. Dev. Rev.: - continued
VRDN: - continued
(BBB Esq. LLC) Series 1996, 3.50%, LOC BankBoston,
NA (b) $ 800,000 $ 800,000
(Barker Steel Co.) Series 1995, 3.50%, LOC State
Street Bank & Trust Co., Boston (b) 800,000 800,000
(Bradford College) Series 1995 A, 3.40%, LOC
BankBoston, NA 1,600,000 1,600,000
(Battery Engineering, Inc.) Series 1996, 3.90%, LOC Bank
of Tokyo-Mitsubishi (b) 1,100,000 1,100,000
(Buckingham Browne Nichols School) 3.35%, LOC State
Street Bank & Trust Co., Boston 3,000,000 3,000,000
(Canton/Cedar Reality LLC 1997) 3.60%, LOC Fleet
Nat'l. Bank (b) 1,400,000 1,400,000
(Carand Reality Trust 1997) 3.50%, LOC State
Street Bank, Boston (b) 1,000,000 1,000,000
(Decas Cranberry Project 1997) 3.60%, LOC Fleet
Nat'l. Bank (b) 3,000,000 3,000,000
(Dover Instrument Corp.) Series 1997, 3.60%, LOC
Fleet Nat'l. Bank (b) 2,000,000 2,000,000
(Eastern Nazarene College) Series 1997, 3.35%,
LOC State Street Bank & Trust Co., Boston 1,750,000 1,750,000
(Edgewood Retirement Commty) Series 1995 C, 3.50%,
LOC Dresdner Bank, AG 300,000 300,000
(Falmouth Assisted Living) Series 1995, 3.35%,
LOC BankBoston, NA 1,900,000 1,900,000
(Fessenden School Issue) Series 1997, 3.50%,
LOC Fleet Nat'l. Bank 3,000,000 3,000,000
(General Signal Proj.) 3.55%, LOC Wachovia Bank
of Georgia 1,900,000 1,900,000
(Goddard House) 3.35%, LOC Fleet Bank, NA 2,500,000 2,500,000
(Gordon College Issue) Series 1997, 3.35%,
LOC State Street Bank & Trust Co., Boston, 2,400,000 2,400,000
(Governor Dummer Academy) Series 1996, 3.35%,
LOC State Street Bank & Trust Co., Boston 1,200,000 1,200,000
(Hazen Paper Proj.) Series1996, 3.50%, LOC
BankBoston, NA (b) 900,000 900,000
(Heritage at Darmouth) Series 1996, 3.45%, LOC
BankBoston, NA (b) 825,000 825,000
(Heritage at Hingham) Series 1997, 3.45%, LOC Fleet
Nat'l. Bank (b) 2,500,000 2,500,000
(Jewish Geriatric Svs.) 3.50%, LOC BankBoston, NA (b) 1,900,000
1,900,000
(Lower Mills Associates II L.P.) Series 1995, 3.30%,
LOC BankBoston, NA 953,000 953,000
(Mary Ann Morse Nursing Home):
Series 1994 A, 3.80%, LOC ABN-AMRO Bank 3,200,000 3,200,000
Series 1994 B, 3.30%, LOC ABN-AMRO Bank 4,600,000 4,600,000
(Mount Ida College) Series 1997, 3.35%,
LOC Credit Local de France 2,400,000 2,400,000
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Massachusetts Ind. Fin. Agcy. Ind. Dev. Rev.: - continued
VRDN: - continued
(Nutramax Products):
Series 1996, 3.50%, LOC BankBoston, NA (b) $ 1,000,000 $ 1,000,000
Series 1996 B, 3.50%, LOC BankBoston, NA (b) 3,100,000 3,100,000
(Parker-Hannifin Corp. Proj.) Series 1997, 3.65%,
LOC Wachovia Bank, NA 1,800,000 1,800,000
(Riverdale Mills Corp.) Series 1995, 3.50%, LOC
BankBoston, NA (b) 2,000,000 2,000,000
(Society of Prevention of Cruelty to Animals)
Series 1997, 3.40%, LOC Fleet Nat'l. Bank 2,000,000 2,000,000
(Southern New England School of Law) 3.50%,
LOC Fleet Nat'l Bank 1,500,000 1,500,000
(United Medical Corp.) Series 1992, 3.40%, LOC Chase
Manhattan Bank (b) 1,300,000 1,300,000
(United Plastics 1997) 3.60%, LOC Fleet Nat'l.
Bank (b) 2,000,000 2,000,000
(Univ. LLC) Series 1996, 3.50%, LOC BankBoston,
NA (b) 1,300,000 1,300,000
(Youville Place Inc.) Series 1996, 3.40% (AMBAC
Insured) (BPA Fleet Nat'l. Bank) 4,500,000 4,500,000
Massachusetts Ind. Fin. Agcy. Poll. Cont. Rev.:
Rfdg. Bonds (New England Power Co. Proj.):
Series 1992 B, CP mode:
3.65% 2/9/98 2,450,000 2,450,000
3.60% 2/23/98 9,300,000 9,300,000
3.60% 2/25/98 1,500,000 1,500,000
3.55% 4/1/98 3,600,000 3,600,000
3.50% 4/7/98 8,500,000 8,500,000
3.55% 4/8/98 2,200,000 2,200,000
Series 1993 A, CP mode:
3.60% 2/25/98 4,500,000 4,500,000
3.50% 4/3/98 7,600,000 7,600,000
3.55% 6/9/98 2,000,000 2,000,000
Series 1993 B, CP mode:
3.80% 2/24/98 3,200,000 3,200,000
3.60% 2/27/98 3,950,000 3,950,000
3.50% 4/3/98 2,600,000 2,600,000
3.55% 4/8/98 2,100,000 2,100,000
3.60% 6/8/98 3,300,000 3,300,000
Massachusetts Ind. Fin. Agcy. Poll. Cont. Rev.
(Holyoke Wtr. Pwr. Co. Proj.) Series 1990, 3.35%,
LOC Swiss Bank, VRDN (b) 3,000,000 3,000,000
Massachusetts Ind. Fin. Agcy. Resource Recovery Rev.
(Ogden-Haverhill Proj.) Series 1986 B, 3.40%,
LOC Union Bank of Switzerland, VRDN (b) 1,700,000 1,700,000
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Massachusetts Muni. Wholesale Elec. Co. Pwr. Supply Sys.
Rev. Series 1994 C, 3.25%, (MBIA Insured)
LOC Credit Swiss First Boston, VRDN $ 16,735,000 $ 16,735,000
Massachusetts Participating VRDN (c):
Series 93-I, 3.68% (Liquidity Facility Citibank, NY) 7,800,000
7,800,000
Series 93-2, 3.45% (Liquidity Facility State Street
Bank & Trust Co., Boston) 15,630,200 15,630,200
Massachusetts Port Auth. Rev.:
Participating VRDN Series 1997 B, 3.70%
(Liquidity Facility Societe Generale) (b)(c) 3,405,000 3,405,000
Series 1997, CP:
3.70% 2/3/98, LOC Canadian Imperial Bank of
Commerce (b) 3,000,000 3,000,000
3.70% 4/20/98, LOC Canadian Imperial Bank of
Commerce (b) 3,500,000 3,500,000
Massachusetts Reg'l. Transit Auth. RAN 4.25% 6/26/98 2,800,000
2,803,691
Massachusetts Tpk. Auth. Participating VRDN (c):
Series PA-181, 3.65% (Liquidity Facility Merrill
Lynch & Co., Inc.) 2,490,000 2,490,000
Series PT-135, 3.65% (Liquidity Facility Banco
Santander, SA) 6,800,000 6,800,000
Series 1997 B, 3.65% (Liquidity Facility Merrill
Lynch & Co., Inc.) 4,550,000 4,550,000
Series 1997 N, 3.71% (Liquidity Facility Bank of America
Nat'l Trust & Savings, SF) 4,000,000 4,000,000
Massachusetts Wtr. Resource Auth.:
CP:
3.70% 2/13/98, LOC Morgan Guaranty Trust Co., NY 6,000,000
6,000,000
3.65% 2/17/98, LOC Morgan Guaranty Trust Co., NY 5,800,000
5,800,000
3.80% 2/18/98, LOC Morgan Guaranty Trust Co., NY 1,700,000
1,700,000
3.80% 2/18/98, LOC Morgan Guaranty Trust Co., NY 2,600,000
2,600,000
3.75% 2/23/98, LOC Morgan Guaranty Trust Co., NY 4,000,000
4,000,000
3.70% 3/9/98, LOC Morgan Guaranty Trust Co., NY 5,000,000
5,000,000
3.70% 3/11/98, LOC Morgan Guaranty Trust Co., NY 1,000,000
1,000,000
3.40% 3/26/98, LOC Morgan Guaranty Trust Co., NY 2,000,000
2,000,000
3.45% 4/1/98, LOC Morgan Guaranty Trust Co., NY 10,300,000
10,300,000
3.45% 4/2/98, LOC Morgan Guaranty Trust Co., NY 4,250,000
4,250,000
3.45% 4/3/98, LOC Morgan Guaranty Trust Co., NY 4,100,000
4,100,000
3.40% 4/6/98, LOC Morgan Guaranty Trust Co., NY 3,500,000
3,500,000
3.45% 4/6/98, LOC Morgan Guaranty Trust Co., NY 3,000,000
3,000,000
3.75% 4/8/98, LOC Morgan Guaranty Trust Co., NY 2,500,000
2,500,000
3.75% 4/9/98, LOC Morgan Guaranty Trust Co., NY 7,300,000
7,300,000
3.75% 5/14/98, LOC Morgan Guaranty Trust Co., NY 4,000,000
4,000,000
3.60% 6/2/98, LOC Morgan Guaranty Trust Co., NY 2,700,000
2,700,000
(Multi-Modal Subordinated Gen. Rev.) VRDN:
Series 1997-A, 3.25% (Liquidity Facility Bank of Nova
Scotia) (AMBAC Insured) 17,000,000 17,000,000
Series 1997-B, 3.25% (Liquidity Facility Bank of Nova
Scotia) (AMBAC Insured) 22,100,000 22,100,000
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
MASSACHUSETTS - CONTINUED
Massachusetts Wtr. Resource Auth.: - continued
Participating VRDN (c):
Series 1995 SG-17, 3.60% (Liquidity Facility Societe
Generale) $ 1,000,000 $ 1,000,000
Series 1996 SG-63, 3.60% (Liquidity Facility Societe
Generale) 1,000,000 1,000,000
Merrimack Valley Reg'l. Transit Auth. RAN 4.25% 6/19/98 2,400,000
2,402,875
New Bedford Gen. Oblig. BAN 4.30% 6/30/98
(BPA Fleet Nat'l. Bank) 1,000,000 1,001,582
Northampton Gen. Oblig. BAN 4.25% 12/22/98 2,497,000 2,506,602
Northborough Gen. Oblig. BAN 4% 2/2/99 2,170,000 2,178,159
Seekonk Gen. Oblig. BAN 4.25% 11/19/98 3,500,000 3,511,552
Southeastern Reg'l. Transit Auth. RAN 4.25% 9/18/98 2,400,000
2,405,058
Springfield Gen. Oblig. BAN:
4.40% 6/26/98 (BPA Fleet Nat'l. Bank) 1,139,000 1,140,956
4.40% 9/4/98 (BPA Fleet Nat'l. Bank) 2,800,000 2,807,922
4.25% 11/20/98 (BPA Fleet Nat'l. Bank) 4,800,000 4,814,786
4.25% 11/20/98 (BPA Fleet Nat'l. Bank) 4,000,000 4,012,327
Uxbridge Gen. Oblig. BAN 4.25% 7/15/98 2,500,000 2,504,313
Walpole BAN 4.15% 6/3/98 1,200,000 1,201,158
Walpole Gen. Oblig. BAN Series 1997, 4% 12/16/98 3,815,000
3,822,051
West Springfield BAN 3.75% 3/5/98 9,132,000 9,133,153
Westfield BAN 4.10% 3/26/98 1,000,000 1,000,206
Weston Gen. Oblig. BAN 4% 9/30/98 3,010,000 3,013,248
731,781,088
PUERTO RICO - 1.0%
Puerto Rico Commonwealth Infrastructure Fin. Auth.
Participating VRDN, Series 1997 A, 3.45%
(Liquidity Facility CoreStates Bank) (c) 3,900,000 3,900,000
Puerto Rico Elec. Pwr. Auth. Pwr. Rev. Bonds
Participating VRDN, Series AA, 3.45%
(Liquidity Facility Societe Generale) (c) 3,200,000 3,200,000
7,100,000
TOTAL INVESTMENTS - 100% $ 738,881,088
Total Cost for Income Tax Purposes $ 738,881,106
SECURITY TYPE ABBREVIATIONS
BAN - Bond Anticipation Note
CP - Commercial Paper
RAN - 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.
3. Provides evidence of ownership in one or more underlying municipal
bonds.
4. Restricted securities - Investment in securities not registered
under the Securities Act of 1933 (see Note 2 of Notes to Financial
Statements).
Additional information on each holding is as follows:
ACQUISITION
SECURITY DATE COST
Massachusetts Hsg.
Fin. Agcy. Single
Family Hsg. Rev.
Bonds 3.80%,
tender 3/1/98 12/1/97 $3,600,000
OTHER INFORMATION
At the end of the period, restricted securities (excluding 144A
issues) amounted to $3,600,000 or 0.5% of net assets.
INCOME TAX INFORMATION
At January 31, 1998, the fund had a capital loss carryforward of
approximately $56,000 of which $8,000, $8,000, $30,000 and $10,000
will expire on January 31, 2003, 2004, 2005 and 2006, respectively.
SPARTAN MASSACHUSETTS MUNICIPAL MONEY MARKET FUND
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
JANUARY 31, 1998
ASSETS
INVESTMENT IN SECURITIES, AT VALUE $ 738,881,088
- -
SEE ACCOMPANYING SCHEDULE
RECEIVABLE FOR INVESTMENTS SOLD 7,700,000
SHARE TRANSACTIONS IN PROCESS 1,565,412
INTEREST RECEIVABLE 5,433,507
TOTAL ASSETS 753,580,007
LIABILITIES
PAYABLE TO CUSTODIAN BANK $ 26,966
PAYABLE FOR INVESTMENTS 8,323,657
PURCHASED
DISTRIBUTIONS PAYABLE 48,512
ACCRUED MANAGEMENT FEE 315,599
OTHER PAYABLES AND ACCRUED 5,175
EXPENSES
TOTAL LIABILITIES 8,719,909
NET ASSETS $ 744,860,098
NET ASSETS CONSIST OF:
PAID IN CAPITAL $ 744,915,957
ACCUMULATED NET REALIZED GAIN (55,859)
(LOSS) ON INVESTMENTS
NET ASSETS, FOR 744,912,966 $ 744,860,098
SHARES OUTSTANDING
NET ASSET VALUE, OFFERING PRICE $1.00
AND REDEMPTION PRICE PER
SHARE ($744,860,098 (DIVIDED BY)
744,912,966 SHARES)
STATEMENT OF OPERATIONS
YEAR ENDED JANUARY 31, 1998
INTEREST INCOME $ 25,012,177
EXPENSES
MANAGEMENT FEE $ 3,429,613
NON-INTERESTED TRUSTEES' 3,074
COMPENSATION
TOTAL EXPENSES BEFORE 3,432,687
REDUCTIONS
EXPENSE REDUCTIONS (29,121) 3,403,566
NET INTEREST INCOME 21,608,611
REALIZED AND UNREALIZED GAIN 77
(LOSS)
NET REALIZED GAIN (LOSS) ON
INVESTMENT SECURITIES
INCREASE (DECREASE) IN NET (2,930)
UNREALIZED GAIN FROM
ACCRETION
OF DISCOUNT
NET GAIN (LOSS) (2,853)
NET INCREASE IN NET ASSETS $ 21,605,758
RESULTING FROM OPERATIONS
OTHER INFORMATION
EXPENSE REDUCTION $ 3,953
CUSTODIAN CREDITS
TRANSFER AGENT CREDITS 25,168
$ 29,121
STATEMENT OF CHANGES IN NET ASSETS
YEAR ENDED YEAR ENDED
JANUARY 31, JANUARY 31,
1998 1997
INCREASE (DECREASE) IN NET
ASSETS
OPERATIONS $ 21,608,611 $ 17,028,668
NET INTEREST INCOME
NET REALIZED GAIN (LOSS) 77 (39,956)
INCREASE (DECREASE) IN NET (2,930) 2,930
UNREALIZED GAIN FROM
ACCRETION
OF MARKET DISCOUNT
NET INCREASE (DECREASE) IN 21,605,758 16,991,642
NET ASSETS RESULTING
FROM OPERATIONS
DISTRIBUTIONS TO SHAREHOLDERS (21,608,611) (17,028,668)
FROM NET INTEREST INCOME
SHARE TRANSACTIONS AT NET ASSET 797,269,094 831,825,582
VALUE OF $1.00 PER SHARE
PROCEEDS FROM SALES OF SHARES
REINVESTMENT OF DISTRIBUTIONS 21,242,709 16,774,462
FROM NET INTEREST INCOME
COST OF SHARES REDEEMED (745,111,081) (691,592,516)
NET INCREASE (DECREASE) IN 73,400,722 157,007,528
NET ASSETS AND SHARES
RESULTING FROM SHARE
TRANSACTIONS
TOTAL INCREASE (DECREASE) IN 73,397,869 156,970,502
NET ASSETS
NET ASSETS
BEGINNING OF PERIOD 671,462,229 514,491,727
END OF PERIOD $ 744,860,098 $ 671,462,229
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
YEARS ENDED JANUARY 31,
1998 1997 1996 1995 1994
SELECTED
PER-SHARE
DATA
NET ASSET VALUE, $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
BEGINNING
OF PERIOD
INCOME FROM .031 .030 .033 .024 .019
INVESTMENT
OPERATIONS
NET INTEREST
INCOME
LESS DISTRIBUTIONS
FROM NET (.031) (.030) (.033) (.024) (.019)
INTEREST INCOME
NET ASSET VALUE, $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
END OF PERIOD
TOTAL RETURN A, B 3.19% 3.00% 3.32% 2.42% 1.95%
RATIOS AND
SUPPLEMENTAL
DATA
NET ASSETS, END $ 744,860 $ 671,462 $ 514,492 $ 406,287 $ 346,880
OF PERIOD
(000 OMITTED)
RATIO OF EXPENSES .50% .50% .50% .50% .40%
TO AVERAGE C
NET ASSETS
RATIO OF NET 3.15% 2.96% 3.27% 2.40% 1.93%
INTEREST INCOME
TO AVERAGE NET
ASSETS
</TABLE>
A TOTAL RETURNS DO NOT INCLUDE THE ACCOUNT CLOSEOUT FEE.
B THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT
BEEN REDUCED DURING THE PERIODS SHOWN.
C FMR AGREED TO REIMBURSE A PORTION OF THE FUND'S EXPENSES DURING THE
PERIOD. WITHOUT THIS REIMBURSEMENT, THE FUND'S EXPENSE RATIO WOULD
HAVE BEEN HIGHER.
NOTES TO FINANCIAL STATEMENTS
For the period ended January 31, 1998
1. SIGNIFICANT ACCOUNTING POLICIES.
Spartan Massachusetts Municipal Income Fund (the income fund)
(formerly Fidelity Massachusetts Municipal Income Fund), Fidelity
Massachusetts Municipal Money Market Fund and Spartan Massachusetts
Municipal Money Market Fund (the money market funds) (collectively,
the funds) are funds of Fidelity Massachusetts Municipal Trust (the
trust). 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. Each fund is
authorized to issue an unlimited number of shares. The financial
statements have been prepared in conformity with generally accepted
accounting principles which permit management to make certain
estimates and assumptions at the date of the financial statements. The
following summarizes the significant accounting policies of the funds:
SECURITY VALUATION.
INCOME FUND. 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. Securities for
which quotations are not readily available are valued at their fair
value as determined in good faith under consistently applied
procedures under the general supervision of the Board of Trustees.
Short-term securities with remaining maturities of sixty days or less
for which quotations are not readily available are valued at amortized
cost or original cost plus accrued interest, both of which approximate
current value.
MONEY MARKET FUNDS. As permitted under Rule 2a-7 of the 1940 Act, and
certain conditions therein, securities are valued initially at cost
and thereafter assume a constant amortization to maturity of any
discount or premium.
INCOME TAXES. As a qualified regulated investment company under
Subchapter M of the Internal Revenue Code, each fund is not subject to
income taxes to the extent that it distributes substantially all of
its taxable income for the fiscal year. The schedules of investments
include information regarding income taxes under the caption "Income
Tax Information."
INTEREST INCOME. Interest income, which includes amortization of
premium and accretion of market discount, is accrued as earned. For
the money market funds, accretion of discount represents unrealized
gain until realized at the time of a security disposition or maturity.
EXPENSES. Most expenses of the trust can be directly attributed to a
fund. Expenses which cannot be directly attributed are apportioned
among 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
1. SIGNIFICANT ACCOUNTING
POLICIES - CONTINUED
DISTRIBUTIONS TO SHAREHOLDERS -
CONTINUED
differences, which may result in distribution reclassifications, are
primarily due to differing treatments for wash sales, market discount,
capital loss carryforwards, expiring capital loss carryforwards,
losses deferred due to futures and excise tax regulations. The income
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 and
may affect the per-share allocation between net interest income and
realized and unrealized gain (loss). Accumulated undistributed net
realized gain (loss) on investments may include temporary book and tax
basis differences that will reverse in a subsequent period. Any
taxable income or gain remaining at fiscal year end is distributed in
the following year.
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.
MUNICIPAL CENTRAL CASH FUND. Pursuant to an Exemptive Order issued by
the Securities and Exchange Commission, the funds may invest in the
Municipal Central Cash Fund (the Cash Fund) managed by Fidelity
Investments Money Management Inc.
(FIMM) (formerly FMR Texas Inc.) an affiliate of Fidelity Management &
Research Company (FMR). The Cash Fund is an open-end money market fund
available only to investment companies and other accounts managed by
FMR and its affiliates. The Cash Fund seeks preservation of capital,
liquidity, and current income by investing in high-quality, short-term
municipal securities of various states and municipalities. Income
distributions from the Cash Fund are declared daily and paid monthly
from net interest income. Income distributions earned by the funds are
recorded as interest income in the accompanying financial statements.
FUTURES CONTRACTS. The income fund may use futures contracts to manage
its exposure to the bond market and to fluctuations in interest rates.
Buying futures tends to increase the fund's exposure to the underlying
instrument, while selling futures tends to decrease the fund's
exposure to the underlying instrument or hedge other fund investments.
Futures contracts involve, to varying degrees, risk of loss in excess
of the futures variation margin reflected in the Statement of Assets
and Liabilities. The underlying face amount at value of any open
futures contracts at period end is shown in the schedule of
investments under the caption "Futures Contracts." This amount
reflects each contract's exposure to the underlying instrument at
period end. Losses may arise from changes in the value of the
underlying instruments or if the counterparties do not perform under
the contracts' terms. Gains (losses) are realized upon the expiration
or closing of the futures contracts. Futures contracts
2. OPERATING POLICIES -
CONTINUED
FUTURES CONTRACTS - CONTINUED
are valued at the settlement price established each day by the board
of trade or exchange on which they are traded.
RESTRICTED SECURITIES. Certain funds are permitted to invest in
securities that are subject to legal or contractual restrictions on
resale. These securities generally may be resold in transactions
exempt from registration or to the public if the securities are
registered. Disposal of these securities may involve time-consuming
negotiations and expense, and prompt sale at an acceptable price may
be difficult. Information regarding restricted securities is included
under the caption "Other Information" at the end of each applicable
fund's schedule of investments.
3. PURCHASES AND SALES OF INVESTMENTS.
INCOME FUND. Purchases and sales of securities, other than short-term
securities, aggregated $256,021,260 and $231,816,278, respectively.
The market value of futures contracts opened and closed during the
period amounted to $192,219,834 and $135,721,189, respectively.
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES.
MANAGEMENT FEE. As the fund's investment adviser for Spartan
Massachusetts Municipal Income Fund and Fidelity Massachusetts
Municipal Money Market Fund, FMR receives a monthly fee that is
calculated on the basis of a group fee rate plus a fixed individual
fund fee rate applied to the average net assets of each fund. The
group fee rate is the weighted average of a series of rates and is
based on the monthly average net assets of all the mutual funds
advised by FMR. The rates ranged from .1100% to .3700% for the period.
The individual fund fee rate is .25%. In the event that these rates
were lower than the contractual rates in effect during the period, FMR
voluntarily implemented the above rates, as they resulted in the same
or a lower management fee. For the period, the management fees were
equivalent to annual rates of .39% of average net assets for Spartan
Massachusetts Municipal Income Fund and Fidelity Massachusetts
Municipal Money Market Fund.
For Spartan Massachusetts Municipal Money Market Fund, 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 .50% of the fund's average net assets. FMR also
bears the cost of providing shareholder services to the fund. To
offset the cost of providing these services, FMR or its affiliates
collected certain transaction fees from shareholders which amounted to
$6,694 for the period.
SUB-ADVISER FEE. As the money market funds' investment sub-adviser,
FIMM receives a fee from FMR of 50% of the management fee payable to
FMR. The fee is paid prior to any voluntary expense reimbursements
which may be in effect.
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES -
CONTINUED
TRANSFER AGENT AND ACCOUNTING FEES. UMB Bank, n.a. (UMB) is the
custodian and transfer and shareholder servicing agent for Spartan
Massachusetts Municipal Income Fund and Fidelity Massachusetts
Municipal Money Market Fund. UMB has entered into a sub-contract with
Fidelity Service Company, Inc. (FSC), an affiliate of FMR, under which
FSC performs the activities associated with the funds' transfer and
shareholder servicing agent and accounting functions. The funds pay
account fees and asset-based fees that vary according to account size
and type of account. FSC pays for typesetting, printing and mailing of
all shareholder reports, except proxy statements. The accounting fee
is based on the level of average net assets for the month plus
out-of-pocket expenses.
For the period, the transfer agent fees were equivalent to an annual
rate of .10% and .15% of average net assets for Spartan Massachusetts
Municipal Income Fund and Fidelity Massachusetts Municipal Money
Market Fund, respectively.
Fidelity Massachusetts Municipal Money Market Fund shareholders
participating in the Fidelity Ultra Service Account(registered
trademark) Program (the Program) paid a $5.00 monthly fee to Fidelity
Brokerage Services, Inc. (FBSI), an affiliate of FMR, for performing
services associated with the Program. For the period, fees paid to
FBSI by shareholders participating in the Program amounted to $54,540.
Effective September 1, 1997, the monthly fee was eliminated.
5. EXPENSE REDUCTIONS.
Each fund has entered into arrangements with its custodian and
transfer agent whereby credits realized on uninvested cash balances
were used to offset a portion of each applicable funds' expenses.
For the period, the reductions under these arrangements are shown
under the caption "Other Information" on each applicable fund's
Statement of Operations.
REPORT OF INDEPENDENT ACCOUNTANTS
To the Trustees of Fidelity Massachusetts Municipal Trust and the
Shareholders of Spartan Massachusetts Municipal Income (formerly
Fidelity Massachusetts Municipal Income), Fidelity Massachusetts
Municipal Money Market and Spartan Municipal Money Market Funds:
In our opinion, the accompanying statements of assets and liabilities,
including the schedules of investments (except for Moody's and
Standard & Poor's ratings), and the related statements of operations
and of changes in net assets and the financial highlights present
fairly, in all material respects, the financial position of Spartan
Massachusetts Municipal Income Fund, Fidelity Massachusetts Municipal
Money Market and Spartan Massachusetts Municipal Money Market funds
(each a fund of Fidelity Massachusetts Municipal Trust ) at January
31, 1998, the results of their operations for the year then ended, and
the changes in their net assets and the financial highlights for the
periods indicated, in conformity with generally accepted accounting
principles. These financial statements and financial highlights
(hereafter referred to as "financial statements") are the
responsibility of the Fidelity Massachusetts Municipal Trust's
management; our responsibility is to express an opinion on these
financial statements based on our audits. We conducted our audits of
these financial statements in accordance with generally accepted
auditing standards which require that we plan and perform the audit to
obtain reasonable assurance about whether
the financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements, assessing the accounting
principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe
that our audits, which included confirmation of securities at January
31, 1998 by correspondence with the custodian and the application of
alternative auditing procedures where securities purchased were not
yet received by the custodian, provide a reasonable basis for the
opinion expressed above.
/s/Price Waterhouse LLP
Price Waterhouse LLP
Boston, Massachusetts
March 5, 1998
DISTRIBUTIONS
During fiscal year ended January 31, 1998, 100% of Spartan
Massachusetts Municipal Income, Fidelity Massachusetts Municipal Money
Market and Spartan Massachusetts Municipal Money Market funds' income
dividends was free from federal income tax, and 4.43%, 10.90% and
10.48% of the fund's income dividends was subject to the federal
alternative minimum tax, respectively.
MANAGING YOUR INVESTMENTS
Fidelity offers several ways to conveniently manage your personal
investments via your telephone or PC. You can access your account
information, conduct trades and research your investments 24 hours a
day.
BY PHONE
Fidelity TouchTone Xpressprovides a single toll-free number to access
account balances, positions, quotes and trading. It's easy to navigate
the service, and on your first call, the system will help you create a
personal identification number (PIN) for security.
SM
(PHONE_GRAPHIC)TOUCHTONE XPRESS
1-800-544-5555
PRESS
For mutual fund and brokerage trading.
For quotes.*
For account balances and holdings.
To review orders and mutual
fund activity.
To change your PIN.
To speak to a Fidelity representative.
0
*
BY PC
Fidelity's Web site on the Internet provides a wide range of
information, including daily financial news, fund performance,
interactive planning tools and news about Fidelity products and
services.
(PHONE_GRAPHIC)FIDELITY'S WEB SITE
WWW.FIDELITY.COM
If you are not currently on the Internet, call Fidelity at
1-800-544-7272 for significant savings on Web access from internetMCI.
SM
(PHONE_GRAPHIC)
FIDELITY ON-LINE XPRESS+
TM
Fidelity On-line Xpress+ software for Windows combines comprehensive
portfolio management capabilities, securities trading and access to
research and analysis tools . . . all on your desktop. Call Fidelity
at 1-800-544-7272 or visit our Web site for more information on how to
manage your investments via your PC.
* 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.
TO VISIT FIDELITY
For directions and hours,
please call 1-800-544-9797.
ARIZONA
7373 N. Scottsdale Road
Scottsdale, AZ
CALIFORNIA
815 East Birch Street
Brea, CA
851 East Hamilton Avenue
Campbell, CA
527 North Brand Boulevard
Glendale, CA
19100 Von Karman Avenue
Irvine, CA
10100 Santa Monica Blvd.
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
950 Northgate Drive
San Rafael, CA
1400 Civic Drive
Walnut Creek, CA
6300 Canoga Avenue
Woodland Hills, CA
COLORADO
1625 Broadway
Denver, CO
CONNECTICUT
48 West Putnam Avenue
Greenwich, CT
265 Church Street
New Haven, CT
300 Atlantic Street
Stamford, CT
29 South Main Street
West Hartford, CT
DELAWARE
222 Delaware Avenue
Wilmington, DE
FLORIDA
4400 N. Federal Highway
Boca Raton, FL
90 Alhambra Plaza
Coral Gables, FL
4090 N. Ocean Boulevard
Ft. Lauderdale, FL
1907 West State Road 434
Longwood, FL
4001 Tamiami Trail, North
Naples, FL
2401 PGA Boulevard
Palm Beach Gardens, FL
8065 Beneva Road
Sarasota, FL
1502 N. Westshore Blvd.
Tampa, FL
GEORGIA
3445 Peachtree Road, N.E.
Atlanta, GA
1000 Abernathy Road
Atlanta, GA
HAWAII
700 Bishop Street
Honolulu, HI
ILLINOIS
One North Franklin Street
Chicago, IL
1415 West 22nd Street
Oak Brook, IL
1700 East Golf Road
Schaumburg, IL
3232 Lake Avenue
Wilmette, IL
INDIANA
4729 East 82nd Street
Indianapolis, IN
LOUISIANA
201 St. Charles Avenue
New Orleans, LA
MAINE
3 Canal Plaza
Portland, ME
MARYLAND
7401 Wisconsin Avenue
Bethesda, MD
1 West Pennsylvania Ave.
Towson, MD
MASSACHUSETTS
470 Boylston Street
Boston, MA
155 Congress Street
Boston, MA
25 State Street
Boston, MA
300 Granite Street
Braintree, MA
44 Mall Road
Burlington, MA
416 Belmont Street
Worcester, MA
MICHIGAN
280 North Woodward Ave.
Birmingham, MI
29155 Northwestern Hwy.
Southfield, MI
MINNESOTA
7600 France Avenue South
Edina, MN
MISSOURI
700 West 47th Street
Kansas City, MO
8885 Ladue Road
Ladue, MO
200 North Broadway
St. Louis, MO
NEW JERSEY
150 Essex Street
Millburn, NJ
56 South Street
Morristown, NJ
501 Route 17, South
Paramus, NJ
NEW YORK
1055 Franklin Avenue
Garden City, NY
999 Walt Whitman Road
Melville, L.I., NY
1271 Avenue of the Americas
New York, NY
71 Broadway
New York, NY
350 Park Avenue
New York, NY
NORTH CAROLINA
4611 Sharon Road
Charlotte, NC
2200 West Main Street
Durham, NC
OHIO
600 Vine Street
Cincinnati, OH
28699 Chagrin Boulevard
Woodmere Village, OH
OREGON
16850 SW 72 Avenue
Tigard, OR
PENNSYLVANIA
1735 Market Street
Philadelphia, PA
439 Fifth Avenue
Pittsburgh, PA
TENNESSEE
6150 Poplar Road
Memphis, TN
TEXAS
10000 Research Boulevard
Austin, TX
4017 Northwest Parkway
Dallas, TX
1155 Dairy Ashford Street
Houston, TX
2701 Drexel Drive
Houston, TX
400 East Las Colinas Blvd.
Irving, TX
14100 San Pedro
San Antonio, TX
19740 IH 45 North
Spring, TX
UTAH
215 South State Street
Salt Lake City, UT
VIRGINIA
8180 Greensboro Drive
McLean, VA
WASHINGTON
411 108th Avenue, N.E.
Bellevue, WA
511 Pine Street
Seattle, WA
WASHINGTON, DC
1900 K Street, N.W.
Washington, DC
WISCONSIN
595 North Barker Road
Brookfield, WI
TO WRITE FIDELITY
If more than one address is listed, 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.
(LETTER_GRAPHIC)MAKING CHANGES
TO YOUR ACCOUNT
(such as changing name, address, bank, etc.)
Fidelity Investments
P.O. Box 770001
Cincinnati, OH 45277-0002
(LETTER_GRAPHIC)FOR NON-RETIREMENT
ACCOUNTS
BUYING SHARES
Fidelity Investments
P.O. Box 770001
Cincinnati, OH 45277-0003
OVERNIGHT EXPRESS
Fidelity Investments
2300 Litton Lane - KH1A
Hebron, KY 41048
SELLING SHARES
Fidelity Investments
P.O. Box 660602
Dallas, TX 75266-0602
OVERNIGHT EXPRESS
Fidelity Investments
Attn: Redemptions - CP6I
400 East Las Colinas Blvd.
Irving, TX 75309-5517
GENERAL CORRESPONDENCE
Fidelity Investments
P.O. Box 500
Merrimack, NH 03054-0500
(LETTER_GRAPHIC)FOR RETIREMENT
ACCOUNTS
BUYING SHARES
Fidelity Investments
P.O. Box 770001
Cincinnati, OH 45277-0003
SELLING SHARES
Fidelity Investments
P.O. Box 660602
Dallas, TX 75266-0602
OVERNIGHT EXPRESS
Fidelity Investments
Attn: Redemptions - CP6R
400 East Las Colinas Blvd.
Irving, TX 75309-5517
GENERAL CORRESPONDENCE
Fidelity Investments
P.O. Box 500
Merrimack, NH 03054-0500
