MESSAGE FROM THE CHAIRMAN
Table of Contents
Page
Message from the Chairman................... 1
Manager's Discussion........................ 3
Special Feature:............................ 6
Interview with Tom Kenny,
Senior Vice-President
Franklin Municipal Bond Department
Performance Summary......................... 11
Statement of Investments.................... 14
Financial Statements........................ 53
Notes to Financial Statements............... 55
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December 15, 1995
Fellow Shareholders:
Welcome to the 21st semi-annual report of the Franklin Federal Tax-Free Income
Fund for the period ended October 31, 1995.
During the reporting period, the Federal Reserve Board (the Fed) appeared to
have been successful in achieving its much sought-after "soft landing." The U.S.
Gross Domestic Product (GDP) fell from an annualized rate of 5.1% in the fourth
quarter of 1994 to just 1.3% in the second quarter of 1995.* This slow growth
prompted the Fed to ease monetary policy in July 1995. Long-term bond yields, as
measured by the 30-year U.S. Treasury bond, jumped slightly to 6.86% following
the shift in policy stance, then resumed the downward course they had followed
since November 1994. On October 31, 1995, the yield of the 30-year Treasury was
6.34%.**
*Source: U.S. Commerce Department.
**Source: Micropal, November 20, 1995.
Of greater importance to our shareholders is the recovery of the municipal bond
market, which can be attributed to a couple of factors. First, a declining
interest rate environment -- such as the one experienced over the reporting
period -- buoyed municipal prices. Second, the dramatically curtailed supply of
municipal issuance together with continued strong demand, further contributed to
higher prices. This recovery resulted in a 28 cent increase in the fund's Class
I net asset value per share price to $12.01 on October 31, 1995, up from $11.73
on April 30, 1995.
On the other hand, the tax-free market has grappled with negative press stemming
from a number of tax reform issues, including a flat tax proposal, a consumption
tax, a national sales tax, and a "Super" IRA. Each of these proposals pose
underlying questions for an investor: Will there be any allowed deductions? Will
I lose the benefit of investing in tax-free municipal bonds?
At Franklin, we understand these issues raise important concerns. For more
information on this topic, please see page 6 for our interview with Tom Kenny,
Director of Franklin's Municipal Bond Department.
As a Franklin shareholder, you receive the benefits of diversification,
professional management and dedicated service. If you have any questions
concerning the Franklin Federal Tax-Free Income Fund, we would certainly welcome
the opportunity to answer them.
We appreciate your trust and support and look forward to serving your investment
needs in the years ahead.
Sincerely,
Charles B. Johnson
Chairman
Franklin Federal Tax-Free Income Fund
MANAGER'S DISCUSSION
Fund Objective:
Seeks to provide high current income exempt from regular federal income tax
through a nationally diversified portfolio of municipal securities.*
Throughout the reporting period, we maintained our focus on long-term income
opportunities, bond quality and diversification. We continued our conservative
approach, managing your fund to provide you with high current income and
relative stability of principal while avoiding short-term trading to capture
possible taxable capital gains. To achieve this objective, we generally purchase
current coupon bonds close to par value or at a slight discount. We also
practice an effective "buy and hold" strategy, electing to retain higher coupons
(even when they trade at a premium) for the higher income and stability they
provide. This strategy has a number of benefits, including fairly low portfolio
turnover rates, which may result in lower fund expenses. At the same time, this
practice tends to protect the fund from extreme price volatility.
GRAPHIC MATERIAL 1 OMMITTED - SEE APPENDIX AT END OF DOCUMENT
In the low-interest rate environment of the early 1990s, municipalities issued
record volumes of new securities. Many of these were issued specifically to pay
off older, higher yielding bonds at their first call date (the earliest date the
original issuer can redeem a bond). These securities, also known as
"pre-refunded" bonds, are paid off with the proceeds from more current, lower
yielding bonds. At the start of the fund's fiscal year, 20.6% of the fund's
total net assets were invested in pre-refunded securities, many of which were
set to be called away in the next few years.
*Dividends are generally subject to state and local income taxes, if any. For
investors subject to federal or state alternative minimum tax, a small portion
of these dividends may be subject to such tax. Distributions of capital gains
and of ordinary income from accrued market discount, if any, are generally
taxable.
During the reporting period, we chose to sell several of these pre-refunded
bonds as we felt they were fully priced in the marketplace. We used the proceeds
of these sales to purchase AAA-rated insured municipal bonds at a slight
discount to par value. In general, insured bonds, which are backed by the
insurer as to the timely payment of principal and interest, have been readily
available in the marketplace. Their AAA credit rating -- the highest available
- -- also helped us to maintain our high quality standards.
Franklin Federal Tax-Free Income Fund
Portfolio Breakdown on October 31, 1995
As a Percentage of Total Investments
% of Total
Sector Investments
Utilities 27.8%
Pre-refunded 16.8%
Housing 13.7%
Transportation 10.7%
General Obligations 9.5%
Hospitals 6.5%
Industrial 4.0%
Certificates of Participation 3.7%
Other Revenue 3.5%
Education 1.9%
Health Care 1.3%
Tax Allocation Bonds 0.5%
Sales Tax Revenue 0.1%
For a complete list of portfolio holdings, please see page 14 of this report.
As you know, we attempt to purchase only investment-grade bonds for the fund's
portfolio; that is, bonds whose credit quality ratings at the time of purchase
fell within Standard & Poor's or Moody's four highest categories, or were judged
to be of equal quality by the fund's managers. On October 31, 1995, over 68% of
the fund's assets were invested in municipal securities rated A or better, with
32.5% invested in securities rated AAA. These ratings, while not guaranteeing
the fund's market value or signifying approval of the shares by Standard &
Poor's or Moody's, reflect the credit quality of the fund's portfolio as
described in the prospectus and are subject to change.
In addition to credit quality, we evaluate each issue on an individual basis,
favoring highly rated "essential service" bonds. These securities tend to have a
more reliable income stream generated from hospitals, utilities, and
transportation projects, to name a few. As a result, these bonds tend to be less
affected by budgetary and political changes, and are believed to be very
attractive in a municipal cost-cutting environment. Water and sewer system bonds
issued by Houston, Texas are some of the "essential service" bonds held in the
fund's portfolio. These bonds characterize the city's large $1.6 billion capital
improvement program, strong historical financial performance, and stable
customer base. Other municipal project bonds we purchased throughout the
reporting period include the Airport Terminal Improvement Project in Clark
County, Nevada, and bonds toward the construction of new air cargo and aircraft
maintenance facilities at McCarran International Airport and the North Las Vegas
Air Terminal.
Since long-term interest rates appear to be working their way down, the volume
of new municipal issuance may pick up from pre-refunded issues as borrowers take
advantage of interest cost savings on their outstanding debt. However, it is
unlikely that this will approach the volume of nearly $300 billion in new
issuance that the market previously experienced in 1993. Overall, low supply
should have a positive influence on bond prices. Of course, a minimum level of
new bonds should be expected to meet basic infrastructure needs. Market and
economic factors, such as the performance of the stock market and tax reform
issues, could result in lower demand and also affect prices.
Because the municipal market is expected to rise and fall periodically, we've
always encouraged our shareholders to focus on their long- term investment
goals. By concentrating on long-term investment objectives, you may be able to
overlook the short-term volatility that accompanies market cycles.
SPECIAL FEATURE: INTERVIEW WITH TOM KENNY
FPO
Tom Kenny
Senior Vice President
Director, Franklin Municipal
Bond Department
Tom Kenny, Director
of Franklin's Municipal
Bond Department,
discusses a number
of current topics,
including tax reform,
interest rates, and
his outlook for the
municipal bond market.
Tom, there's been a lot of press lately on the possibility of tax reform -- in
particular, a flat tax. What proposals are being considered?
There are three different flat tax proposals being discussed. And, these are in
addition to a number of other tax reform proposals, such as a consumption tax, a
national sales tax and a "Super" IRA. Basically, tax reform is a hot topic right
now, ever since President Clinton appeared on national TV in April after filling
out his tax forms and said, "You know, a flat tax doesn't sound so bad."
With numerous tax reform proposals being considered, do you think that one of
them is going to pass? The support for tax reform seems to be waning in recent
weeks as more details of some of these proposals are released. Ten out of ten
tax payers will tell you that taxes are too high and the current system is too
complicated. There is tremendous support for simplification. But when people
realize that they would lose their mortgage deduction -- which could cause their
home value to decline by 15 - 20% -- or that the wealthy would receive a large
tax cut while the middle class would have to pay more taxes under a flat tax
system, their opinion may change. So, I feel there is support for simplification
but not necessarily for radical reform.
However, I think something will happen. There's such a movement behind change
that it's not just going to disappear. With the election coming up, you're going
to continue hearing about tax reform, you're going to read about it, you're
going to see it on TV through next year and into 1997. But I don't think
anything will actually happen until '97, at the earliest.
Has the possibility of tax reform affected the municipal bond market at all?
The possibility of major tax reform has depressed municipal bond prices relative
to other fixed-income investments during the past few months; however, since we
have experienced a strong bond market, it hasn't been that noticeable. The
market has already somewhat priced the potential impact of tax reform, which
makes municipal yields very attractive today.
Depending on the state you live in and your tax bracket, the after-tax
equivalent yield available can be a very attractive 10%. Also, supply is down
25% in 1995 from 1994, and over 50% versus 1993. At the same time, we are
experiencing a record amount of bonds that are being called or redeemed and for
the second consecutive year, more bonds will be taken out of the muni market
than issued.
What is that in dollar terms?
The market may see about $130 to $140 billion in new issuance this year,
compared to $162 billion last year and $290 billion the year before. So new
issuance is down dramatically.
Did rising interest rates have anything to do with that?
Sure, but there are other reasons as well. One, voters simply aren't approving
as many bond issues today. Two, many governors that were elected last fall are
trying to implement tax cuts; in effect, they're reducing budgets and there's
just not a lot of debt capacity for increased debt service. And three, a big
reason we saw such high issuance in 1993 was because lower interest rates
resulted in an increase in refunding and pre-refunding issues -- just as many
homeowners refinanced their mortgages in '93 to take advantage of lower rates.
But because of tax code changes in 1986, issuers of municipal bonds can only
refund or pre-refund their bonds once. Those that could refund, did. As a
result, the potential inventory of refundable bonds is much lower than a few
years ago.
How will these factors affect prices of muni bonds?
It should be positive. The supply/demand fundamentals of the municipal market
are, in my opinion, promising, and the market has already partially discounted
the threat of tax reform. Over the long term, muni prices should improve on a
relative basis. From a historical perspective, munis are cheap today.
Investors can take advantage of this by dollar-cost averaging.
Another topic that's been a concern during the past year has been the bankruptcy
of Orange County, California. What's been the long-term impact on the municipal
bond market?
The biggest impact has been in investor perception. Historically, general
obligation bonds (those that are backed by the full faith and credit of the
issuer) have been perceived as the safest kind of municipal bond. But in a
bankruptcy situation, like in Orange County, the investments that are most
affected are general obligations. Revenue bonds, backed by dedicated revenue
streams -- such as those from airport authority, solid waste authority,
transportation and the like -- haven't really been impacted. Investors in
general have re-thought how they look at revenue bonds and general obligation
bonds.
We have also seen an increase in the use of bond insurance, especially in
California. This year, the percentage of bonds for the entire market is
approximately 44% of total issuance, while in California, 52% of all issues
obtained insurance.
Is that a big increase?
For the muni industry overall, it has increased from 37%; in California, it has
increased from 32%. In my opinion, that's a big jump. As a result, insured bonds
have become less expensive to purchase relative to uninsured bonds simply
because of the increased supply. And we have taken advantage of that by buying
more insured bonds this year.
What about interest rates? Have changes in interest rates affected your buying
decisions?
No. We don't try to second guess the market in terms of where we think rates are
headed or alter our fundamental approach because of economic changes. Many
portfolio managers attempt this in an effort to capture capital growth.
Our approach is very straight forward. We seek safety and income. I don't think
shareholders want the volatility you might generate by chasing capital growth.
We don't want to be number one in total return one year, and number 100 the
next.
We use a consistent, conservative, "plain vanilla" approach. We manage our funds
for tax-free income and take a long-term approach. Over time, income will drive
total return. For example, as measured by the Lehman Brothers 20-Year Municipal
Bond Index, income has been responsible for over 99% of total return of
municipal bonds over the last five years.1 So, by investing for income, you
should generate good total return performance. We think our shareholders are
better served by the using this consistent approach. Investors in tax-free funds
want to maximize tax-free income.
How much research do you do before you buy a bond?
It really depends on the quality and type of bond. Lower-rated and non-rated
bonds will typically require more credit analysis than higher-rated bonds. Since
we purchase over 95% of our portfolio holdings in the new issue market, we spend
a lot of time up front performing site visits, addressing legal issues, and
structuring the issue to meet our credit and portfolio requirements. We have 23
analysts who spend much of their time researching new issues. They also monitor
these issues long after purchase.
1.Source: Lehman Brothers 20-Year Municipal Bond Index.
What are Franklin's total holdings in municipal bonds?
We currently have approximately $41 billion in municipal bonds in 42 tax-free
funds. Franklin is the largest buyer of municipal bonds in the country.
Does that size give you any advantages?
Sure. We get the attention of issuers and underwriters and try to capitalize on
that by encouraging them to visit us in San Mateo to discuss their issue. This
allows us to give our input on structuring a deal. They, of course, hope that we
buy their deal.
When you say input, does that commit you to purchasing?
No. You can have input from a bond structuring standpoint, from a pricing
standpoint (in terms of coupons and maturities). And all of that input can go to
the underwriter of the issue without any commitment on our part at all. But if
they make those changes to meet our needs, then we're more likely to buy it than
if they don't. So it can be to everyone's advantage. We end up with an issue
that meets our needs in terms of credit, price, coupon and maturity, and the
issuer ends up with a marketable product.
Where do you see the municipal bond market going through the end of the year,
and through the first six months of 1996?
I'd say the muni market is going to remain stable. We're going to see more of
the same, probably through the presidential election next fall. I think
uncertainty surrounding tax reform is going to continue to hold down munis for a
while longer. No matter what happens to the bond market, the economy or interest
rates, we'll do what we've always done: we'll do our homework, maximize tax-free
income for our shareholders, and maintain a long-term investment horizon.
Thanks, Tom.
It's been my pleasure.
PERFORMANCE SUMMARY
Class I Shares
The Franklin Federal Tax-Free Income Fund's Class I share price, as measured by
net asset value, increased to $12.01 on October 31, 1995, from $11.73 on April
30, 1995.
The fund continued to meet its investment objective of providing high current
income to shareholders. Your fund's Class I shares paid monthly income
distributions totaling 37.2 cents ($0.372) per share for the six-month period
ended October 31, 1995.
At the close of the reporting period, your fund's Class I shares' distribution
rate was 5.93%, based on an annualization of the current monthly dividend of 6.2
cents ($0.062) per share and the maximum offering price of $12.54 on October 31,
1995. This tax-free rate is generally higher than the after-tax return on a
comparable taxable investment.
As the chart to the right illustrates, if you are in the maximum federal income
tax bracket of 39.6%, you would have to earn 9.82% from a taxable investment to
match your fund's tax-free distribution rate. Dividends will vary based on the
earnings of the fund's portfolio, and past distributions are not necessarily
predictive of future results.
GRAPHIC MATERIAL 2 OMMITTED - SEE APPENDIX AT END OF DOCUMENT
Based on this dividend income and change in share price, the fund's Class I
shares produced a cumulative total return of 5.65% for the six-month period and
12.55% for the one-year period ended October 31, 1995. Total return excludes the
initial sales charge and measures the change in value of an investment over the
periods indicated, assuming reinvestment of dividends and any capital gains. Of
course, past performance is not predictive of future results. As the table on
page 13 demonstrates, the fund has achieved an average annual total return of
8.54% over the 10-year period.
Class II Shares
Class II shares were introduced on May 1, 1995. The price of the fund's Class II
shares, as measured by net asset value, increased to $12.01 on October 31, 1995
from $11.67 on May 1, 1995.
The fund continued to meet its investment objective of providing shareholders
with a high level of current tax-free income. Your fund's Class II shares paid
monthly income distributions totaling 34.2 cents ($0.342) per share for the
six-month period ended October 31, 1995.
At the close of the reporting period, your fund's Class II shares' distribution
rate was 5.54%, based on an annualization of the current monthly dividend of 5.6
cents ($.056) per share and the maximum offering price of $12.13 on October 31,
1995. This tax-free rate is generally higher than the after-tax return on a
comparable taxable investment.
GRAPHIC MATERIAL 3 OMMITTED - SEE APPENDIX AT END OF DOCUMENT
As the chart above illustrates, if you are in the maximum federal income tax
bracket of 39.6%, you would have to earn 9.17% from a taxable investment to
match your fund's Class II share tax-free distribution rate. Dividends will vary
based on earnings of the fund's portfolio, and past distributions are not
predictive of future results.
We have always maintained a long-term investment perspective, and we encourage
our shareholders to do the same. While the Franklin Federal Tax-Free Income Fund
may encounter occasional volatility, we believe that its performance will be
rewarding over the long term.
<TABLE>
<CAPTION>
Franklin Federal Tax-Free Income Fund
Periods ended October 31, 1995
Since Since
Inception Inception
1-Year 5-Year 10-Year (10/7/83) (05/01/95)
Cumulative Total Return1
<S> <C> <C> <C> <C> <C>
Class I Shares 12.55% 52.23% 137.06% 201.90% --
Class II Shares -- -- -- -- 5.93%
Average Annual Total Return2
Class I Shares 7.73% 7.83% 8.54% 9.18%
Aggregate Total Return3
Class II Shares 3.33%
Distribution Rate4 Equivalent Taxable Distribution Rate5
Class I Shares 5.93% Class I Shares 9.82%
Class II Shares 5.54% Class II Shares 9.17%
30-Day Standardized Yield6 Equivalent Taxable Yield5
Class I Shares 5.06% Class I Shares 8.38%
Class II Shares 4.67% Class II Shares 7.73%
</TABLE>
1. Cumulative total return measures the change in value of an investment over
the periods indicated and does not include the maximum 4.25% initial sales
charge for Class I shares or the maximum 1.0% initial sales charge and 1. 0%
contingent deferred sales charge (CDSC) for Class II shares, applicable to
shares redeemed within the first 18 months of investment. See note below.
2. Average annual total return represents the average annual change in value of
an investment over the specified periods. The figures reflect the maximum 4.25%
initial sales charge for Class 1 shares. See note below.
3. Aggregate total return, which includes the 1.0% initial sales charge and the
1.0% CDSC applicable to shares redeemed within 18 months of purchase, and
represents the change in value of an investment since the inception date of the
fund's Class II shares. It assumes reinvestment of dividends and capital gains.
Since Class II shares have existed for less than one year, average annual total
returns are not provided. See note below.
4. Distribution rate for Class I shares is based on an annualization of the
fund's current 6.2 cents per share monthly dividend and the maximum offering
price of $12.54 on October 31, 1995. For Class II shares, distribution rate is
based on an annualization of the fund's current 5.6 cents per share monthly
dividend and the maximum offering price of $12.13 on October 31, 1995.
5. Equivalent taxable distribution rate and yield assume the 1995 maximum 39.6%
federal income tax rate.
6. Yield, calculated as required by the SEC, is based on the earnings of the
fund's portfolio for the 30 days ended October 31, 1995.
Note: Prior to July 1, 1994, fund Class I shares were offered at a lower initial
sales charge, with dividends reinvested at the public offering price. Thus,
actual total returns for purchasers of shares during that period would have been
somewhat different than noted above. Effective May 1, 1994, the fund eliminated
the sales charge on reinvested dividends and implemented a plan of distribution
under Rule 12b-1, which will affect future performance. Class II shares, which
the fund began offering on May 1, 1995, are subject to different fees and
expenses, which will affect their performance. Please see the prospectus for
more details regarding Class I and Class II shares.
All total return calculations assume reinvestment of dividends and capital gains
at net asset value. Investment return and principal value will fluctuate with
market conditions, and you may have a gain or loss when you sell your shares.
Past performance cannot guarantee future results.
FRANKLIN FEDERAL TAX-FREE INCOME FUND
<TABLE>
<CAPTION>
Statement of Investments in Securities and Net Assets, October 31, 1995 (unaudited)
Face Value
Amount (Note 1)
Long Term Investments 98.5%
Alabama .7%
<S> <C> <C>
$ 6,620,000 Alabama Water Pollution Control Authority, Revolving Fund, Series B, 7.75%,
08/15/12 ................................................................. $ 7,107,960
5,000,000 Birmingham GO, Street Improvement Warrants, Pre-Refunded, 8.00%, 07/01/13.. 5,552,000
1,000,000 Citronelle IDB, PCR, Stauffer Chemical Project, Guaranteed by Imperial
Chemical, Plc., Series 1982, 8.00%, 12/01/12 ............................. 1,140,700
18,830,000 Columbia IDB, PCR, Refunding, Alabama Power Co. Project, AMBAC Insured,
6.50%, 09/01/23 .......................................................... 19,670,383
12,000,000 Courtland IDB, IDR, Refunding, Champion International Corp., Series A, 7.20%,
12/01/13 ................................................................. 13,098,720
5,000,000 Courtland IDB, PCR, Refunding, Champion International Corp. Project, 6.15%,
06/01/19 ................................................................. 4,956,650
-------------
51,526,413
-------------
Alaska 1.2%
1,775,000 Alaska Industrial Development and Export Authority, Revolving Fund, Series A,
7.95%, 04/01/10 .......................................................... 2,012,193
Alaska State HFC,
230,000 CHM, Series A, 8.375%, 12/01/16 ........................................ 239,419
4,300,000 CHM, Series A-1, 6.75%, 12/01/32 ....................................... 4,455,187
2,075,000 CHM, Series A-3, 7.70%, 12/01/13 ....................................... 2,154,431
8,825,000 Refunding, Mortgage Insured, Program 1, Series 1990-B, 7.80%, 12/01/30 . 9,308,434
18,375,000 aRefunding, Series A, MBIA Insured, 5.875%, 12/01/24 .................... 18,134,288
11,600,000 aRefunding, Series A, MBIA Insured, 5.875%, 12/01/30 .................... 11,321,716
8,000,000 Series A, 6.60%, 12/01/23 .............................................. 8,791,920
21,940,000 Veterans Mortgage Program, MBIA Insured, 6.75%, 12/01/25 ............... 22,760,995
Anchorage Parking Authority Revenue, Refunding,
3,360,000 5th Avenue Garage Lease Project, 6.50%, 12/01/02 ....................... 3,615,696
3,500,000 5th Avenue Garage Lease Project, 6.75%, 12/01/08 ....................... 3,706,570
-------------
86,500,849
-------------
Arizona .5%
14,720,000 Glendale IDA, Hospital Revenue, Northwest Development, Inc. Project,
Pre-Refunded, 8.875%, 01/01/16 .......................................... 15,629,549
11,665,000 Pima County IDA, MFHR, Fountains La Cholla Project, FHA Mortgage Insured,
8.00%, 12/01/25 .......................................................... 11,926,413
5,690,000 Tempe IDA, Residential Care Facilities Revenue, Volunteers of America Care
Facilities, 9.00%, 06/01/18 .............................................. 6,028,214
-------------
33,584,176
-------------
Arkansas .2%
$ 3,185,000 Desha County, Residential Housing Facilities Board, SFMR, Refunding, 7.50%,
04/01/11 ................................................................. $ 3,427,442
3,115,000 Independence County, Public Health and Education Facilities Board Capital
Revenue, Refunding & Improvement, White River Control Project,
Pre-Refunded, 8.00%, 06/01/09 ............................................ 3,537,861
1,465,000 Jefferson County, PCR, Refunding, Arkansas Power and Light Co. Project,
6.30%, 06/01/18 .......................................................... 1,526,926
2,600,000 Pope County, PCR, Refunding, Power and Light Co. Project, 6.30%, 12/01/16 . 2,695,316
-------------
11,187,545
-------------
California 6.5%
Alhambra COP,
410,000 Clubhouse Facility Project, 11.25%, 01/01/08 ........................... 424,235
455,000 Clubhouse Facility Project, 11.25%, 01/01/09 ........................... 470,757
500,000 Clubhouse Facility Project, 11.25%, 01/01/10 ........................... 517,315
5,325,000 Burbank RDA, Refunding, Tax Allocation, Series A, 6.25%, 12/01/24 ......... 5,192,408
2,030,000 Butte County COP, Justice Facilities Project, 5.70%, 07/01/14 ............. 1,942,243
2,800,000 California Health Facilities, Financing Authority Revenue, Refunding, St. Francis
Medical Center, Series H, AMBAC Insured, 6.30%, 10/01/15 ................. 2,909,256
5,000,000 California HFA, HMR, Series F, MBIA Insured, 6.00%, 08/01/17 .............. 5,037,150
California State Educational Facilities Authority Revenue,
3,580,000 National University, Connie Lee Insured, 6.00%, 05/01/09 ............... 3,698,176
1,000,000 Pooled College and University Financing, Refunding, Series B, 5.70%,
06/01/01 .............................................................. 1,030,720
California State GO,
10,000,000 FGIC Insured, 6.00%, 08/01/19 .......................................... 10,165,100
3,070,000 Series 1994, 5.90%, 05/01/08 ........................................... 3,169,376
7,000,000 Series 1994, 6.00%, 05/01/18 ........................................... 7,103,320
12,500,000 Series 1994, FGIC Insured, 6.00%, 05/01/20 ............................. 12,704,125
11,750,000 Various Purposes, 5.90%, 04/01/23 ...................................... 11,701,708
California State Public Works Board Lease Revenue,
5,500,000 Series A, 5.75%, 09/01/21............................................... 5,433,890
3,500,000 Various University of California Projects, Series A, 6.625%, 10/01/10 .. 3,726,030
4,000,000 Various University of California Projects, Series A, 6.375%, 10/01/14 .. 4,137,960
2,000,000 Various University of California Projects, Series A, 6.375%, 10/01/19 .. 2,060,880
California State Veterans, GO,
33,195,000 Series B, 6.55%, 02/01/25 .............................................. 33,853,589
1,000,000 Series BC, 6.00%, 02/01/10 ............................................. 1,010,310
14,750,000 California Statewide Communities Development Authority Revenue, COP,
Sutter Health Obligation Group, MBIA Insured, 6.00%, 08/15/25 ............ 15,010,338
California (cont.)
$ 8,250,000 Chino USD, COP, Refunding, FSA Insured, 5.90%, 09/01/15 ................... $ 8,291,003
1,020,000 Coalinga Public Finance Authority Revenue, Series B, 6.25%, 09/15/07 ...... 1,028,395
1,000,000 Commerce, Refuse to Energy Authority Revenue, Refunding, Series 1994,
8.75%, 07/01/10 .......................................................... 1,138,350
4,000,000 Eden Township Hospital, District Health Facilities Revenue, Refunding, COP,
Eden Hospital Health Services Corp., 5.75%, 07/01/12 ..................... 3,862,520
Foothill/Eastern Transportation Corridor Agency, Toll Road Revenue, Senior Lien,
54,740,000 Series A, 6.50%, 01/01/32 .............................................. 54,945,275
3,000,000 Series B, 5.00%, 01/01/35 .............................................. 2,413,470
Forty-Niner Shops, Inc., Auxiliary Organization,
1,090,000 California State Long Beach Project, 6.875%, 04/01/07 .................. 1,139,028
1,565,000 California State Long Beach Project, 6.875%, 04/01/12 .................. 1,625,002
3,180,000 Los Angeles Community RDA, Housing Revenue, Refunding, Series A,
AMBAC Insured, 6.55%, 01/01/27 ........................................... 3,278,039
3,000,000 Los Angeles County Transportation Commission Sales Tax Revenue,
Proposition C, Series A, MBIA Insured, 6.00%, 07/01/23 ................... 3,031,980
Los Angeles Department of Water and Power Electric Plant Revenue,
14,925,000 Refunding, 6.40%, 11/01/31 ............................................. 15,561,551
3,000,000 Refunding, MBIA Insured, 6.00%, 02/01/28 ............................... 3,031,170
10,500,000 Second Issue, MBIA Insured, 6.40%, 11/01/31 ............................ 10,942,470
8,100,000 Los Angeles GO, Series A, FGIC Insured, 6.20%, 09/01/14 ................... 8,314,893
8,400,000 Los Angeles Regional Airport Improvements Corp., Lease Revenue, Refunding,
United Airlines, Inc. Project, 6.875%, 11/15/12 .......................... 8,664,432
24,270,000 Madera County COP, Valley Children's Hospital, MBIA Insured, 5.75%, 03/15/28 23,779,261
33,315,000 San Bernardino County COP, Medical Center Financing Project, Series A,
5.875%, 08/01/26 ......................................................... 33,409,281
7,080,000 San Francisco City and County RDAR, George Mascone Convention Center,
Lease Revenue, 6.75%, 07/01/24 ........................................... 7,643,568
12,680,000 San Francisco City and County RDAR, Tax Allocation Redevelopment Project,
6.50%, 08/01/22 .......................................................... 13,120,884
10,380,000 San Francisco City and County Sewer Revenue, Series A, FGIC Insured,
5.90%, 10/01/20 .......................................................... 10,464,493
San Joaquin Hills Transportation,
18,795,000 Corridor Agency Toll Road Revenue, 7.00%, 01/01/30 ..................... 19,538,906
44,325,000 Corridor Agency Toll Road Revenue, 6.75%, 01/01/32 ..................... 45,320,983
5,000,000 Corridor Agency Toll Road Revenue, 5.00%, 01/01/33 ..................... 4,058,650
3,150,000 Santa Barbara County Revenue, COP, Refunding, Montecito Retirement, 5.80%,
04/01/18 ................................................................. 3,024,032
10,000,000 Southern California Public Power Authority, Southern Transmission Project
Revenue, Sub-Crossover Refunding, MBIA Insured, 5.75%, 07/01/21 .......... 9,945,900
California (cont.)
$ 26,780,000 University of California Revenues, Research Facilities, Series B, 6.55%, 09/01/24 $27,653,831
2,405,000 Windsor RDAR, Tax Allocation, Windsor Project, 7.00%, 09/01/24 ............ 2,506,635
-------------
459,032,888
-------------
Colorado 4.4%
Colorado HFA, GO,
1,595,000 Series A, 7.50%, 05/01/29 .............................................. 1,683,602
2,730,000 Series A, Pre-Refunded, 8.375%, 01/01/30 ............................... 3,013,975
Denver City and County, Airport System Revenue,
11,200,000 Series A, 7.50%, 11/15/12 .............................................. 12,272,848
16,645,000 Series A, 8.875%, 11/15/12 ............................................. 19,557,043
5,000,000 Series A, 8.00%, 11/15/17 .............................................. 5,297,950
11,460,000 Series A, 7.75%, 11/15/21 .............................................. 12,506,986
2,650,000 Series A, 7.25%, 11/15/23 .............................................. 2,813,823
16,520,000 Series A, 7.50%, 11/15/23 .............................................. 18,009,939
79,945,000 Series A, 8.50%, 11/15/23 .............................................. 90,672,020
24,525,000 Series A, 7.25%, 11/15/25 .............................................. 26,380,807
2,000,000 Series A, 8.00%, 11/15/25 .............................................. 2,211,620
22,325,000 Series A, 8.00%, 11/15/25 .............................................. 24,683,860
10,010,000 Series D, 7.00%, 11/15/25 .............................................. 10,286,176
47,980,000 Denver City and County, Special Facilities Airport Revenue, United Airlines, Inc.
Project, Series A, 6.875%, 10/01/32 ...................................... 48,725,129
3,000,000 Garfield Pitkin and Eagle County, School District No. 1, MBIA Insured, 6.60%,
12/15/14 ................................................................. 3,210,630
6,730,000 Littleton IDR, Porter Memorial Hospital Medical Office Project, Series 1982,
Pre-Refunded, 8.00%, 02/01/12 ............................................ 7,174,247
16,500,000 Littleton MFR, Rental Housing, Riverpointe Project I, Series 1985, Mandatory
Put 10/01/96, 8.00%, 12/01/22 ............................................ 16,576,395
6,500,000 University of Colorado, Hospital Authority Revenue, Series A, AMBAC Insured,
6.40%, 11/15/22 .......................................................... 6,789,575
-------------
311,866,625
-------------
Connecticut
3,500,000 Connecticut State Special Tax Obligation Revenue, Transportation Infrastructure,
Series B, FGIC Insured, 5.625%, 10/01/14 ................................. 3,461,675
-------------
Delaware
1,160,000 Delaware State EDA Revenue, Refunding, Water Development, Wilmington,
Series B, 6.45%, 12/01/07 ................................................ 1,265,896
2,000,000 Delaware State Housing Authority, Refunding, MFMR, Series D, 6.75%, 07/01/06 2,137,800
-------------
3,403,696
-------------
District of Columbia .6%
$ 6,500,000 District of Columbia GO, Series A, Pre-Refunded, 8.00%, 06/01/07........... $ 6,950,775
6,110,000 District of Columbia HFA, MFHR, FHA Insured, Mayfair Mansions Apartments,
8.85%, 02/01/31 .......................................................... 6,411,162
District of Columbia HFA, MFHR, Refunding,
1,870,000 FHA Insured, Series A, 7.10%, 09/01/12 ................................. 1,962,079
6,755,000 FHA Insured, Series A, 7.15%, 03/01/24 ................................. 7,046,816
4,640,000 District of Columbia Hospital Revenue, Washington Hospital Center Corp.,
Series A, Pre-Refunded, 9.00%, 01/01/08 .................................. 5,598,438
5,685,000 District of Columbia Revenue, Association of American Medical Colleges,
7.50%, 02/15/20 .......................................................... 6,216,775
5,265,000 District of Columbia Revenue, Catholic University of America, 6.45%,
10/01/23 ................................................................. 5,507,769
-------------
39,693,814
-------------
Florida 3.6%
Bay County Resource Recovery Revenue,
2,100,000 Refunding, Series A, MBIA Insured, 6.50%, 07/01/07 ..................... 2,315,460
11,020,000 Refunding, Series B, MBIA Insured, 6.50%, 07/01/07 ..................... 12,150,652
2,620,000 Series 1984, Pre-Refunded, 8.00%, 07/01/12 ............................. 2,793,418
44,080,000 Broward County Resource Recovery Revenue, Broward Waste Energy Co.,
Limited Partnership, North Project, Series 1984, 7.95%, 12/01/08 ......... 49,119,666
3,800,000 Dunes Community Development District Revenue, Water and Sewer Project,
Pre-Refunded, 8.25%, 10/01/18 ............................................ 4,281,346
22,475,000 Florida State Board of Education Capital Outlay, Refunding, Public Education,
Series 1992, 6.40%, 06/01/19 ............................................. 23,856,314
Florida State Department of General Services, Division of Facilities
Management Revenue,
16,000,000 Florida Facilities Pool, Pre-Refunded, 7.75%, 09/01/16 ................. 16,825,760
2,000,000 Florida Facilities Pool, Pre-Refunded, 8.125%, 09/01/17 ................ 2,246,640
5,000,000 Refunding, Florida Facilities Pool, Series B, AMBAC Insured, 5.70%, 09/01/20 5,003,550
7,125,000 Florida State Department of Transportation, Turnpike Revenue, Series A,
Pre-Refunded, 7.75%, 07/01/09 ............................................ 8,083,811
20,500,000 Hillsborough County Capital Improvement Program, Water and Wastewater
Facilities Revenue, BMTF, Mode A, Sub-Series 2, Pre-Refunded, 8.30%,
08/01/16 ................................................................. 21,131,810
4,075,000 Lakeland Retirement Community, First Mortgage Revenue, Carpenters Home
Estate Project, 9.50%, 09/01/06 .......................................... 4,098,635
6,500,000 Manatee County IDR, Manatee Hospital and Health Systems, Inc., 9.25%,
03/01/21 ................................................................. 8,060,520
7,500,000 North Broward Hospital District Revenue, Pre-Refunded, 8.00%, 01/01/14 .... 7,774,350
Florida (cont.)
$ 3,500,000 Okeechobee Utilities Systems Authority Revenue, Refunding, Acquisition and
Improvement, MBIA Insured, 5.60%, 10/01/25 ............................... $ 3,464,685
Orange County Health Facilities Authority Revenue,
4,785,000 Pooled Hospital Loan Program, Series B, BIG Insured, 7.875%, 12/01/25... 5,082,436
5,940,000 Refunding, Pooled Hospital Loan Program, Series 1985-A, FGIC Insured,
7.875%, 12/01/25 ...................................................... 6,309,230
2,500,000 Santa Rosa County Health Facilities Authority Revenue, Refunding, Gulf
Breeze Hospital, Inc., Pre-Refunded, 8.70%, 10/01/14 ..................... 2,839,775
St. Augustine Water and Sewer Revenue, Refunding,
840,000 Series A, MBIA Insured, 8.125%, 10/01/00 ............................... 915,449
890,000 Series A, MBIA Insured, 8.125%, 10/01/01 ............................... 978,902
940,000 Series A, MBIA Insured, 8.125%, 10/01/02 ............................... 1,042,084
1,005,000 Series A, MBIA Insured, 8.125%, 10/01/03 ............................... 1,121,510
1,065,000 Series A, MBIA Insured, 8.125%, 10/01/04 ............................... 1,190,926
1,130,000 Series A, MBIA Insured, 8.125%, 10/01/05 ............................... 1,264,142
1,200,000 Series A, MBIA Insured, 8.125%, 10/01/06 ............................... 1,341,120
1,275,000 Series A, MBIA Insured, 8.125%, 10/01/07 ............................... 1,410,469
1,355,000 Series A, MBIA Insured, 8.125%, 10/01/08 ............................... 1,487,993
6,300,000 Series A, MBIA Insured, 8.125%, 10/01/12 ............................... 6,691,419
Tampa Capital Improvement Program Revenue,
11,010,000 Series A, 8.25%, 10/01/18 .............................................. 11,914,802
37,250,000 Series B, 8.375%, 10/01/18 ............................................. 39,689,875
-------------
254,486,749
-------------
Georgia 4.4%
Burke County Development Authority, PCR, Georgia Power Co., Plant
Vogle Project,
105,000,000 Series 1984-1, MBIA Insured, 6.60%, 07/01/24 ........................... 109,558,050
8,025,000 Series 1984-7, MBIA Insured, 6.625%, 10/01/24 .......................... 8,396,638
14,500,000 Dekalb County Residential Care Facilities for the Elderly Authority Revenue,
Refunding, King's Bridge Retirement Center, Inc., 8.75%, 01/01/17 ........ 4,350,000
Fulton County Development Authority, Special Facilities Revenue, Refunding,
3,400,000 Delta Air Lines, Inc. Project, 6.85%, 11/01/07 ......................... 3,593,766
5,500,000 Delta Air Lines, Inc. Project, 6.95%, 11/01/12 ......................... 5,781,105
7,975,000 Gainsville and Hall County Hospital Authority Revenue, Anticipation Certificates,
Refunding, Northeast Georgia Healthcare Project, MBIA Insured, 6.00%,
10/01/25 ................................................................. 8,103,398
Georgia Municipal Electric Authority Power Revenue,
19,200,000 Series A, Pre-Refunded, 7.875%, 01/01/18 ............................... 19,705,344
14,000,000 Series B, 6.375%, 01/01/16 ............................................. 14,344,540
Georgia (cont.)
Georgia Municipal Electric Authority Power Revenue, (cont.)
$ 6,325,000 Series EE, 6.40%, 01/01/23 ............................................. $ 6,814,049
26,000,000 Series EE, AMBAC Insured, 6.65%, 01/01/21 .............................. 26,906,880
50,000,000 Series L, Pre-Refunded, 7.75%, 01/01/18 ................................ 53,087,000
18,500,000 Series O, 8.125%, 01/01/17 ............................................. 20,160,560
5,505,000 Georgia State HFAR, Homeownership Opportunity Program, Series C, 6.60%,
12/01/23 ................................................................. 5,686,555
16,000,000 Monroe County Development Authority, PCR, Georgia Power Co., Plant Scherer
Project, 8.375%, 07/01/17 ................................................ 17,118,240
10,000,000 Putnam County Development Authority, PCR, Refunding, Georgia Power Co.,
Plant Branch Project, 8.375%, 07/01/17 ................................... 10,728,000
-------------
314,334,125
-------------
Hawaii .5%
Hawaii State Airports System Revenue,
1,000,000 FGIC Insured, 7.00%, 07/01/20 .......................................... 1,090,300
12,000,000 Second Series, 7.00%, 07/01/07 ......................................... 13,126,680
500,000 Second Series, 6.90%, 07/01/12 ......................................... 554,780
2,830,000 Second Series, 7.00%, 07/01/18 ......................................... 3,024,025
Hawaii State Department of Budget and Finance, Special Purposes Mortgage
Revenue,
200,000 Hawaii Electric Light Co. Project, 7.20%, 12/01/14 ..................... 213,946
1,000,000 Hawaii Electric Light Co. Project, Series A, 7.35%, 01/01/20 ........... 1,074,530
900,000 Kaiser Hospital, 6.25%, 03/01/21 ....................................... 913,086
1,000,000 Wahiawa General Hospital Project, 7.50%, 07/01/12 ...................... 1,067,350
Hawaii State HFC, SFMR,
230,000 Series A, 7.00%, 07/01/11 .............................................. 240,490
3,350,000 Series A, 7.10%, 07/01/24 .............................................. 3,471,404
360,000 Series B, 6.90%, 07/01/16 .............................................. 374,252
11,880,000 Series B, 7.00%, 07/01/31 .............................................. 12,348,547
Honolulu City and County GO,
415,000 Series A, 6.30%, 03/01/08 .............................................. 444,341
1,000,000 Series A, 6.30%, 03/01/12 .............................................. 1,046,660
-------------
38,990,391
-------------
Idaho .1%
2,260,000 Idaho Housing Agency, Refunding, Series D-1, 6.45%, 07/01/19 .............. 2,344,411
Idaho Housing Agency, SFMR,
1,300,000 Senior Bond, Series B-1, FGIC Insured, 7.85%, 07/01/09 ................. 1,377,194
2,035,000 Senior Bond, Series B-1, FGIC Insured, 7.90%, 01/01/21 ................. 2,123,909
-------------
5,845,514
-------------
Illinois 5.2%
Bryant PCR, Refunding, Central Illinois Light Co. Project,
$ 7,200,000 Series A, 6.50%, 02/01/18 .............................................. $ 7,617,528
5,000,000 Series C, 6.50%, 01/01/10 .............................................. 5,365,200
22,400,000 Chicago COP, AMBAC Insured, 7.75%, 07/15/11 ............................... 25,849,600
7,000,000 Chicago Gas Supply Revenue, Refunding, The Peoples Gas Light, Series A,
6.10%, 06/01/25 .......................................................... 6,971,020
Chicago-O'Hare International Airport Revenue,
11,720,000 Special Facility, American Airlines, Inc. Project, 8.20%, 12/01/24 ..... 13,767,367
4,300,000 Special Facility, United Airlines, Inc. Project, 8.45%, 05/01/07 ....... 4,788,179
12,305,000 Special Facility, United Airlines, Inc. Project, 8.50%, 05/01/18 ....... 13,623,112
480,000 Special Facility, United Airlines, Inc. Project, Series A, 8.40%, 05/01/18 522,768
29,330,000 Special Facility, United Airlines, Inc. Project, Series C, 8.20%, 05/01/18 31,761,750
10,000,000 Cook County, Orland Park School District No. 135, Refunding, FGIC Insured,
5.90%, 12/01/14 .......................................................... 10,128,700
Illinois Development Finance Authority, PCR,
7,500,000 Commonwealth Edison Co. Project, Series 1991, 7.25%, 06/01/11 .......... 8,053,575
15,200,000 Refunding, Central Illinois Public Services Co., Series A, 6.375%, 01/01/28 15,650,832
25,960,000 Refunding, Illinois Power Co. Project, Series A, 7.375%, 07/01/21 ...... 29,102,458
6,000,000 Illinois Development Financial Authority Revenue, Refunding, Marriott
Retirement, Series A, 7.75%, 08/01/10 .................................... 6,466,920
6,000,000 Illinois Educational Facilities Authority Revenue, Shedd Aquarium Society,
Series 1987-A, 8.625%, 07/01/17 .......................................... 6,458,400
4,250,000 Illinois HDA, Homeowner Mortgage, Series A-1, 6.85%, 08/01/17 ............. 4,520,343
Illinois HDA, MF Program,
20,000,000 Lawndale Redevelopment Project, 7.10%, 12/01/34 ........................ 21,009,000
12,915,000 Refunding, Series A, 7.10%, 07/01/26 ................................... 13,542,411
12,000,000 Series 1, 6.625%, 09/01/12 ............................................. 12,450,360
7,550,000 Series 1, 6.75%, 09/01/21 .............................................. 7,791,374
2,265,000 Series C, 7.35%, 07/01/11 .............................................. 2,354,535
7,065,000 Illinois HDA, RMR, Series B, 7.25%, 08/01/17 .............................. 7,501,405
2,000,000 Illinois Health Facilities Authority Revenue, Edwards Hospital Project, 7.00%,
02/15/22 ................................................................. 2,127,460
Illinois Health Facilities Authority Revenue, Refunding,
3,650,000 Galesburg Cottage Hospital, Pre-Refunded, 9.625%, 05/01/11 ............. 4,009,233
9,345,000 Grant Hospital of Chicago, Series 1986, Pre-Refunded, 7.50%, 06/01/13 .. 9,870,376
1,000,000 Servantcor, Series A, Pre-Refunded, 7.875%, 08/15/19 ................... 1,136,760
3,000,000 Servantcor, Series B, Pre-Refunded, 7.875%, 08/15/19 ................... 3,410,280
6,200,000 Westlake Community Hospital, 7.875%, 01/01/13 .......................... 6,544,162
7,000,000 Illinois Health Facilities Authority Revenue, Refunding, South Surburban
Hospital, 7.00%, 02/15/18 ................................................ 7,366,870
Illinois (cont.)
$ 2,600,000 Illinois State COP, CGIC Insured, 6.875%, 07/01/07 ........................ $ 2,874,586
2,950,000 Illinois State Dedicated Tax Revenue, Civic Center, Series A, AMBAC Insured,
6.00%, 12/15/15 .......................................................... 2,975,547
3,825,000 Lombard, Village of, Revenue, Refunding, Beacon Hill Project, 9.00%, 02/15/08 3,962,624
Metropolitan Pier and Exposition Authority, State Tax Revenue,
7,760,000 Expansion, Project A, 6.50%, 06/15/22 .................................. 8,039,670
26,115,000 Expansion, Project A, 6.50%, 06/15/27 .................................. 26,979,145
4,350,000 Onterie Center HFC, Mortgage Revenue, Refunding, Series 1989-A, MBIA
Insured, 7.05%, 07/01/27 ................................................. 4,592,034
3,970,000 Regional Transportation Authority, Series A, AMBAC Insured, 6.125%, 06/01/22 4,028,637
Southwestern Illinois Development Authority,
6,200,000 Anderson Hospital Project, Series A, 7.00%, 08/15/22 ................... 6,161,932
1,825,000 IDR, Spectrulite Consortium, Inc. Project, 6.20%, 02/01/05 ............. 1,893,638
3,050,000 IDR, Spectrulite Consortium, Inc. Project, 6.625%, 02/01/10 ............ 3,197,590
3,030,000 Private Activity Revenue, Glenmark Recovery, 8.50%, 08/01/10 ........... 3,404,114
5,500,000 Solid Waste Disposal Revenue, LaCede Steel Co., 8.375%, 08/01/08 ....... 6,146,525
5,390,000 Solid Waste Disposal Revenue, LaCede Steel Co., 8.50%, 08/01/20 ........ 6,017,773
-------------
370,035,793
-------------
Indiana 1.3%
Frankfort Middle School Building Corp.,
605,000 First Mortgage Revenue, Pre-Refunded, 8.00%, 01/01/07 .................. 632,655
660,000 First Mortgage Revenue, Pre-Refunded, 8.10%, 01/01/08 .................. 690,591
720,000 First Mortgage Revenue, Pre-Refunded, 8.10%, 01/01/09 .................. 753,372
785,000 First Mortgage Revenue, Pre-Refunded, 8.10%, 01/01/10 .................. 821,385
860,000 First Mortgage Revenue, Pre-Refunded, 8.10%, 01/01/11 .................. 899,861
935,000 First Mortgage Revenue, Pre-Refunded, 8.10%, 01/01/12 .................. 978,337
2,355,000 Hammond PCR, Stauffer Chemical Project, Guaranteed by Imperial Chemical,
Plc., Series 1982, 8.00%, 11/01/12 ....................................... 2,682,557
17,000,000 Hammond Industrial Sewer and Solid Waste Disposal Revenue, American
Maize-Products Co. Project A, 8.00%, 12/01/24 ............................ 18,719,380
Indiana Bond Bank, Special Program,
6,000,000 Series 1986-A, 7.75%, 08/01/09 ......................................... 6,159,660
1,155,000 Series 1988-A, Pre-Refunded, 8.375%, 02/01/18 .......................... 1,232,628
3,500,000 Indiana Health Facility Financing Authority, Hospital Revenue, Hancock
Memorial Hospital Project, Series 1990, 8.30%, 08/15/20 .................. 3,746,750
3,240,000 Indiana State Educational Facilities Authority Revenue, Manchester College
Project, 6.85%, 10/01/18 ................................................. 3,357,612
Indiana State Housing Financing Authority, SFMR,
3,805,000 Refunding, Series A, 6.75%, 01/01/10 ................................... 3,958,684
16,570,000 Refunding, Series A, 6.80%, 01/01/17 ................................... 17,181,764
Indiana (cont.)
Indianapolis Local Public Improvement,
$ 4,625,000 Refunding, Series D, 6.50%, 02/01/22 ................................... $ 4,699,416
13,075,000 Series D, 6.75%, 02/01/20 .............................................. 13,657,753
Indianapolis Resource Recovery Revenue, Ogden Martin System, Inc.,
5,550,000 Series A, 7.90%, 12/01/08 .............................................. 5,842,985
1,505,000 Series B, 7.90%, 12/01/08 .............................................. 1,584,449
2,000,000 Muncies Edit Building Corp., First Mortgage, Series A, AMBAC Insured, 6.60%,
12/01/17 ................................................................. 2,118,560
-------------
89,718,399
-------------
Iowa .1%
2,500,000 Carroll Retirement Facility Revenue, Orchard View, Inc. Project, Pre-Refunded,
8.25%, 02/01/13 .......................................................... 2,757,150
4,200,000 Woodbury County Health Systems Revenue, Refunding, St. Lukes Obligated
Group, Series A, MBIA Insured, 5.50%, 09/01/12 ........................... 4,082,946
-------------
6,840,096
-------------
Kansas .4%
Merriam Hospital Revenue,
5,815,000 Shawnee Medical Center, Inc. Project A, 7.25%, 09/01/11 ................ 6,223,039
15,215,000 Shawnee Medical Center, Inc. Project A, 7.25%, 09/01/21 ................ 16,182,370
1,560,000 Shawnee Medical Center, Inc. Project B, 7.25%, 09/01/11 ................ 1,669,465
3,580,000 Shawnee Medical Center, Inc. Project B, 7.25%, 09/01/21 ................ 3,807,616
-------------
27,882,490
-------------
Kentucky 2.1%
3,900,000 Ashland PCR, Refunding, Ashland Oil, Inc. Project, 6.65%, 08/01/09 ........ 4,116,177
8,405,000 Christian County Hospital Revenue, Refunding, Jennie Stuart Medical Center
Project, 7.625%, 04/01/10 ................................................ 8,714,472
10,000,000 Henderson County Solid Waste Disposal Revenue, MacMillan Bloedel Project,
7.00%, 03/01/25 .......................................................... 10,452,300
4,985,000 Jefferson County MFHR, Watterson Park Apartments Project, Series A, 6.35%,
11/15/11 ................................................................. 5,073,583
Kenton County Airport Board, Airport Revenue, Special Facilities,
20,000,000 Delta Air Lines, Inc., 7.80%, 12/01/15 ................................. 21,432,800
10,000,000 Delta Air Lines, Inc., Project A, 7.50%, 02/01/20 ...................... 10,648,700
9,330,000 Delta Air Lines, Inc., Project A, 7.125%, 02/01/21 ..................... 9,714,396
3,350,000 Delta Air Lines, Inc., Project B, 7.25%, 02/01/22 ...................... 3,542,927
Kentucky Housing Corp., Housing Revenue,
1,950,000 Series A, 6.70%, 07/01/17 .............................................. 2,030,262
4,910,000 Series B, 6.625%, 07/01/14 ............................................. 5,121,130
Kentucky (cont.)
$ 700,000 Kentucky State Development Financial Authority, Hospital Revenue, Claire
Medical Center Project, Pre-Refunded, 7.125%, 09/01/21 ................... $ 794,353
4,500,000 Kentucky State Property and Buildings Commission Revenue, Project No. 48,
Pre-Refunded, 8.00%, 08/01/08 ............................................ 5,014,980
Mount Sterling Lease Revenue, Kentucky League Cities,
20,375,000 Series A, 6.10%, 03/01/08 .............................................. 21,120,318
11,765,000 Series A, 6.20%, 03/01/18 .............................................. 11,838,178
27,160,000 Pendleton County, Multi-County Lease Revenue, Kentucky Association
Counties Leasing Trust, Series A, 6.50%, 03/01/19 ........................ 27,535,623
-------------
147,150,199
-------------
Louisiana 2.2%
2,000,000 Bastrop PCR, Refunding, International Paper Co. Project, 6.90%, 03/01/07 .. 2,179,460
14,285,000 Calcasieu Parish, IDB, PCR, Refunding, Gulf States Utilities Co. Project,
6.75%, 10/01/12 .......................................................... 14,508,846
Calcasieu Parish, Memorial Hospital Service District Revenue,
4,310,000 Lake Charles Parish Memorial Hospital Project, Series A, CGIC Insured,
6.375%, 12/01/12 ...................................................... 4,619,760
5,530,000 Lake Charles Parish Memorial Hospital Project, Series A, CGIC Insured,
6.50%, 12/01/18 ....................................................... 5,996,456
3,145,000 Lake Charles Parish Memorial Hospital Project, Series A, CGIC Insured,
6.65%, 12/01/21 ....................................................... 3,324,580
Calcasieu Parish, Public Transportation Authority Mortgage Revenue, Refunding,
4,580,000 Series 1991-A, 7.75%, 06/01/12 ......................................... 4,901,837
630,000 Series 1992-B, 6.375%, 11/01/02 ........................................ 662,017
845,000 Series 1992-B, 6.875%, 11/01/12 ........................................ 876,434
2,500,000 De Soto Parish, Environmental Improvement Revenue, International Paper Co.
Project, Series A, 7.70%, 11/01/18 ....................................... 2,859,150
2,365,000 Denham Spring-Livingston HFA, 6.80%, 02/01/21 ............................. 2,437,771
East Baton Rouge Mortgage Financing Authority, SFM,
6,800,000 MBS, Series A, 6.80%, 10/01/28 ......................................... 7,026,916
3,670,000 Series C, 7.00%, 04/01/32 .............................................. 3,842,784
5,570,000 Series D, 7.10%, 04/01/32 .............................................. 5,801,768
Lafayette Public Trust Finance Authority, SFMR,
2,333,604 Refunding, Series 1990-A, 8.50%, 11/15/12 .............................. 2,504,587
5,830,000 Series 1995, 6.875%, 02/01/27 .......................................... 6,006,358
2,250,000 Louisiana HFA, HMR, Refunding, 7.375%, 09/01/13 ........................... 2,322,293
3,400,000 Louisiana Office Facility Corp., Capital Facility Bonds Statewide Lease, 7.75%,
12/01/10 ................................................................. 3,781,344
Louisiana (cont.)
$ 3,500,000 Louisiana Public Facilities Authority Revenue, Refunding, Series B, Alton
Ochsner Medical Foundation Project, MBIA Insured, 6.50%, 05/15/22 ........ $ 3,658,165
New Orleans GO,
10,275,000 Refunding, AMBAC Insured, 6.125%, 10/01/16 ............................. 10,625,480
8,050,000 Refunding, AMBAC Insured, 6.20%, 10/01/21 .............................. 8,307,117
2,200,000 Pointe Coupee Parish PCR, Refunding, Gulf States Utilities Co. Project, 6.70%,
03/01/13 ................................................................. 2,231,262
4,000,000 Quachita Parish, Hospital Service District No. 1 Revenue, Glenwood Regional
Medical Center, 7.50%, 07/01/21 .......................................... 4,285,360
1,900,000 St. James' Parish, COP, Pre-Refunded, 7.50%, 07/01/10 ..................... 1,943,434
West Feliciana Parish PCR,
2,000,000 Gulf Systems Utilities Co. Project, 7.70%, 12/01/14 .................... 2,175,260
3,050,000 Gulf Systems Utilities Co. Project, 7.00%, 11/01/15 .................... 3,163,064
41,050,000 Gulf Systems Utilities Co. Project, 8.00%, 12/01/24 .................... 44,251,490
-------------
154,292,993
-------------
Maine 1.2%
5,000,000 Bucksport Solid Waste Disposal Revenue, Champion International Corp.
Project, 6.25%, 05/01/10 ................................................. 5,102,200
29,300,000 Financial Authority Solid Waste Recycling Facilities Revenue, Great Northern
Paper Co., Bowater Project, 7.75%, 10/01/22 .............................. 31,995,600
Maine State Health and Higher Education Facilities Authority Revenue,
2,445,000 Series B, FSA Insured, 7.00%, 07/01/24 ................................. 2,687,911
3,400,000 Series D, FSA Insured, 5.70%, 07/01/13 ................................. 3,377,254
Maine State Housing Authority, Mortgage Purchase,
2,500,000 Series A-5, 6.20%, 11/15/16 ............................................ 2,521,375
3,700,000 Series C, 6.55%, 11/15/12 .............................................. 3,861,838
3,500,000 Series C, 6.65%, 11/15/24 .............................................. 3,640,630
3,540,000 Series D, 6.45%, 11/15/07 .............................................. 3,620,429
5,800,000 Series D, 6.70%, 11/15/15 .............................................. 6,139,126
4,800,000 Rumford PCR, Refunding, Boise Cascade Corp. Project, 6.625%, 07/01/20 ..... 4,930,896
4,500,000 Skowhegan, PCR, Refunding, Scott Paper Co. Project, Series B, 8.10%,
10/01/15 ................................................................. 5,022,855
10,000,000 Skowhegan, Solid Waste Disposal Revenue, S.D. Warren Co. Project,
Series A, 8.40%, 10/01/15 ................................................ 11,174,700
-------------
84,074,814
-------------
Maryland 2.0%
Gaithersburg Hospital Facilities Improvement Revenue,
10,110,000 Refunding & Improvement, Shady Grove Hospital, FSA Insured, 6.00%,
09/01/21 .............................................................. 10,332,420
Maryland (cont.)
Gaithersburg Hospital Facilities Improvement Revenue, (cont.)
$ 43,225,000 Shady Grove Hospital, Series A, Pre-Refunded, 8.25%, 09/01/21 .......... $ 51,795,221
Maryland State Community Development Administration, Department of
Housing and Community Development,
5,810,000 MFHR, Insured Mortgage, Series G, 6.55%, 05/15/19 ...................... 5,981,744
1,000,000 SF, 7.25%, 04/01/27 .................................................... 1,051,260
4,900,000 Maryland State Health and Higher Educational Facilities Authority Revenue,
Hartford Memorial Hospital and Fallston General Hospital, 8.50%, 07/01/14 5,175,086
6,500,000 Montgomery County, Housing Opportunity Community, SFMR, Refunding,
Series B, 6.625%, 07/01/28 ............................................... 6,677,840
Tokoma Park Hospital Facilities Revenue, Refunding, Washington Adventist
Hospital,
20,125,000 Series A, Sub-Series 1, 8.25%, 09/01/21 ................................ 21,829,990
10,930,000 Series A, Sub-Series 1, Pre-Refunded, 8.25%, 09/01/21 .................. 13,128,242
23,210,000 Series A, Sub-Series 2, Pre-Refunded, 8.25%, 09/01/21 .................. 27,811,847
-------------
143,783,650
-------------
Massachusetts 3.0%
10,900,000 Agawam Resource Recovery Revenue, Springfield Resource Recovery Project,
Series 1986, 8.50%, 12/01/08 ............................................. 11,573,729
3,915,000 Lowell GO, Pre-Refunded, 7.625%, 02/15/10 ................................. 4,577,066
2,310,000 Massachusetts Health and Educational Facilities Authority Revenue, Notre
Dame Health Care Center, Series A, 7.875%, 10/01/22 ...................... 2,406,789
7,500,000 Massachusetts State Bay Transportation Authority, General Transportation
System, Series B, Pre-Refunded, 7.80%, 03/01/10 .......................... 8,778,525
Massachusetts State Consolidated Loan,
7,500,000 Series A, 7.50%, 06/01/04 .............................................. 8,956,350
5,000,000 Series D, 7.00%, 07/01/07 .............................................. 5,570,800
21,720,000 Massachusetts State Dedicated Income Tax, Fiscal Recovery Loan, Series A,
7.875%, 06/01/97 ......................................................... 23,013,860
5,900,000 Massachusetts State GO, Refunding, Series B, 6.50%, 08/01/08 .............. 6,613,487
Massachusetts State Health and Educational Facilities Authority Revenue,
9,020,000 Framingham Union Hospital, Series B, Pre-Refunded, 8.50%, 07/01/20 ..... 10,675,982
1,100,000 Melrose-Wakefield Hospital, Series B, Refunding, 6.35%, 07/01/06 ....... 1,150,523
4,680,000 St. Elizabeth's Hospital of Boston, Series B, FHA Mortgage Insured, FGIC
Insured, Pre-Refunded, 7.75%, 08/01/27 ................................ 5,055,617
1,000,000 Sisters Providence Health System, Series A, 6.50%, 11/15/08 ............ 1,040,810
12,050,000 Sisters Providence Health System, Series A, 6.625%, 11/15/22 ........... 11,922,511
5,250,000 Massachusetts State HFA, HDA, Series D, FGIC Insured, 6.875%, 11/15/21 .... 5,538,803
Massachusetts (cont.)
Massachusetts State HFA, Housing Projects, Refunding,
$ 25,635,000 Series A, 6.30%, 10/01/13 .............................................. $ 25,941,338
25,350,000 aSeries A, 6.375%, 04/01/21 ............................................. 25,517,310
Massachusetts State HFA, Housing Revenue,
6,250,000 aSF, Series 41, 6.30%, 12/01/14 ......................................... 6,367,875
5,750,000 aSF, Series 41, 6.35%, 06/01/17 ......................................... 5,858,158
2,410,000 Massachusetts State HFAR, SFMR, Series G, 8.10%, 12/01/14 ................. 2,538,790
Massachusetts State Housing Facilities Authority,
250,000 Series C, FGIC Insured, 6.875%, 11/15/11 ............................... 268,018
9,715,000 Series C, FGIC Insured, 6.90%, 11/15/21 ................................ 10,265,452
250,000 Series D, FGIC Insured, 6.80%, 11/15/12 ................................ 265,940
6,000,000 Massachusetts State Industrial Finance Agency, First Mortgage Revenue,
Brookhaven at Lexington Retirement Project, Pre-Refunded, 10.25%, 01/01/18 6,906,300
3,000,000 Massachusetts State Water Resources Authority, Series A, MBIA Insured,
5.75%, 12/01/21 .......................................................... 2,959,950
Plymouth County COP,
10,000,000 Series A, 7.00%, 04/01/12 .............................................. 10,892,900
5,000,000 Series A, 7.00%, 04/01/22 .............................................. 5,413,550
-------------
210,070,433
-------------
Michigan 1.9%
2,000,000 Battle Creek, Tax Increment Finance Authority, 7.40%, 05/01/16 ............ 2,216,900
2,445,000 Climax-Scotts, Community Schools, 6.35%, 05/01/23 ......................... 2,534,022
2,250,000 Detroit GO, Self-Insurance, Series A, 5.70%, 05/01/02 ..................... 2,240,348
Detroit GO,
7,265,000 Refunding, Series B, 6.375%, 04/01/06 .................................. 7,507,288
625,000 Refunding, Series B, 6.25%, 04/01/09 ................................... 633,094
4,550,000 Series A, 6.70%, 04/01/10 .............................................. 4,762,121
4,960,000 Detroit GO, Unlimited Tax, Series A, Pre-Refunded, 7.875%, 04/01/08 ....... 5,487,496
4,000,000 Detroit Water Supply System Revenue, Second Lien, Series A, MBIA Insured,
5.50%, 07/01/25 .......................................................... 3,852,600
Greater Detroit Resource Recovery Authority Revenue,
13,205,000 Series A, 9.25%, 12/13/08 .............................................. 13,654,234
5,000,000 Series B, 9.25%, 12/13/08 .............................................. 5,170,100
22,250,000 Series C, 9.25%, 12/13/08 .............................................. 23,006,945
4,590,000 Series E, 9.25%, 12/13/08 .............................................. 4,746,152
1,055,000 Series G, 8.25%, 12/13/96 .............................................. 1,082,314
7,200,000 Series G, 9.25%, 12/13/08 .............................................. 7,444,944
5,980,000 Series H, 9.25%, 12/13/08 ............................................. 6,183,440
Michigan (cont.)
Michigan State HDA,
$ 2,500,000 Limited Obligation Revenue, Fraser Woods Project, FSA Insured, 6.625%,
09/15/19 .............................................................. $ 2,599,725
5,000,000 Rental Housing Revenue, Refunding, Series A, 6.60%, 04/01/12 ........... 5,138,400
Michigan State HFA, SFMR,
2,000,000 Series A, 6.45%, 12/01/14 .............................................. 2,068,020
3,055,000 Series A, 6.875%, 06/01/23 ............................................. 3,182,119
Michigan State Hospital Finance Authority Revenue,
8,450,000 McLaren Obligated Group, Series A, Pre-Refunded, 7.50%, 09/15/21 ....... 9,873,825
5,000,000 Sisters of Mercy Hospital, Series 1991, Pre-Refunded, 7.375%, 02/15/11 . 5,735,050
9,420,000 Monroe County PCR, Detroit Edison Co. Project, Series 1985-A, 10.50%,
12/01/16 ................................................................. 9,749,794
5,600,000 a St. John's Public School District GO, 5.75%, 05/01/25 ..................... 5,560,632
-------------
134,429,563
-------------
Minnesota 2.7%
Bloomington Port Authority, Tax Increment Revenue,
1,020,000 Stadium Site Redevelopment Project, Pre-Refunded, 8.25%, 02/01/97 ...... 1,051,059
1,255,000 Stadium Site Redevelopment Project, Pre-Refunded, 8.25%, 02/01/98 ...... 1,293,215
1,515,000 Stadium Site Redevelopment Project, Pre-Refunded, 8.25%, 02/01/99 ...... 1,561,132
1,800,000 Stadium Site Redevelopment Project, Pre-Refunded, 8.25%, 02/01/00 ...... 1,854,810
2,115,000 Stadium Site Redevelopment Project, Pre-Refunded, 8.25%, 02/01/01 ...... 2,179,402
41,800,000 Stadium Site Redevelopment Project, Pre-Refunded, 8.55%, 02/01/09 ...... 43,102,906
Dakota County Housing, RDA, Limited Annual Appropriation Tax and Revenue,
515,000 Development Housing Facilities Project, 7.25%, 01/01/97 ................ 520,675
555,000 Development Housing Facilities Project, 7.25%, 01/01/98 ................ 564,424
600,000 Development Housing Facilities Project, 7.25%, 01/01/99 ................ 611,910
645,000 Development Housing Facilities Project, 7.25%, 01/01/00 ................ 659,016
695,000 Development Housing Facilities Project, 7.25%, 01/01/01 ................ 710,144
3,930,000 Development Housing Facilities Project, 7.50%, 01/01/06 ................ 4,029,743
2,580,000 Development Housing Facilities Project, 8.00%, 01/01/07 ................ 2,685,238
6,845,000 Duluth Commercial Development Revenue, Duluth Radisson Hotel Project,
10.75%, 12/01/14 ......................................................... 6,996,891
5,870,000 Minneapolis CDA, Commercial Development Revenue, WNB & Co. Project,
8.50%, 12/01/15 .......................................................... 5,877,044
Minneapolis CDA, Commercial Supported Development Revenue, Refunding,
2,500,000 Limited Tax, Series 1987-3, 8.625%, 12/01/27 ........................... 2,648,750
1,000,000 Series 1987-1, 8.625%, 12/01/12 ........................................ 1,059,500
Minneapolis CDA and St. Paul Housing RDA,
5,000 Homeownership Mortgage Revenue, Joint Housing Program, FGIC Insured,
9.875%, 12/01/15 ...................................................... 5,103
Minnesota (cont.)
Minneapolis CDA and St. Paul Housing RDA, (cont.)
$ 8,189,000 Homeownership Mortgage Revenue, Joint Housing Program, Phase II,
FGIC Insured, 7.875%, 07/01/17 ........................................ $ 8,409,038
Minnesota State HFA, SFM,
1,250,000 Refunding, Series B, 6.25%, 08/01/22 ................................... 1,261,413
3,825,000 Series D-1, 6.45%, 07/01/11 ............................................ 4,007,682
1,520,000 Series D-1, 6.50%, 01/01/17 ............................................ 1,576,058
6,500,000 Series D-1, 6.80%, 07/01/25 ............................................ 6,907,030
2,580,000 Series F, 6.30%, 07/01/25 .............................................. 2,634,051
11,500,000 Minnetonka MFR, Rental Housing, Ridgepointe Housing Project, Phase II,
Mandatory Put 10/01/96, 8.00%, 05/15/22 .................................. 11,505,750
1,500,000 Red Wing Housing, RDA, Jordan Tower II Project, 7.00%, 01/01/19 ........... 1,571,865
14,275,000 Roseville MFR, Rental Housing, Rosepointe No. 1 Project, Mandatory Put
10/01/96, 8.00%, 10/01/18 ................................................ 14,440,305
6,000,000 St. Louis Park EDA, Tax Increment Revenue, Refunding, FGIC Insured,
Pre-Refunded, 8.40%, 09/01/09 ............................................ 7,252,260
St. Paul Port Authority,
4,125,000 Energy Park, Tax Increment Revenue, Refunding, Pre-Refunded, 8.00%,
12/01/07 .............................................................. 4,641,698
370,000 Housing and Redevelopment, MFR Rental Housing, Series B, 7.00%,
09/01/97 .............................................................. 111,000
980,000 Housing and Redevelopment, MFR Rental Housing, Series B, 7.25%,
09/01/01 .............................................................. 294,000
14,835,000 Housing and Redevelopment, MFR Rental Housing, Series B, 7.50%,
09/01/22 .............................................................. 4,450,500
2,445,000 IDR, Bandana Square, Series 1989-C, 7.70%, 12/01/07 .................... 1,858,200
3,465,000 IDR, Bandana Square, Series 1989-C, 7.80%, 12/01/12 .................... 2,633,400
415,000 IDR, Brown and Bigelow Co., Series 1979-2, 7.50%, 10/01/97 ............. 411,701
445,000 IDR, Brown and Bigelow Co., Series 1979-2, 7.50%, 10/01/98 ............. 439,838
480,000 IDR, Brown and Bigelow Co., Series 1979-2, 7.50%, 10/01/99 ............. 472,805
515,000 IDR, Brown and Bigelow Co., Series 1979-2, 7.50%, 10/01/00 ............. 505,668
550,000 IDR, Brown and Bigelow Co., Series 1979-2, 7.50%, 10/01/01 ............. 538,445
595,000 IDR, Brown and Bigelow Co., Series 1979-2, 7.50%, 10/01/02 ............. 580,904
640,000 IDR, Brown and Bigelow Co., Series 1979-2, 7.50%, 10/01/03 ............. 623,251
685,000 IDR, Brown and Bigelow Co., Series 1979-2, 7.50%, 10/01/04 ............. 665,505
740,000 IDR, Brown and Bigelow Co., Series 1979-2, 7.50%, 10/01/05 ............. 717,371
795,000 IDR, Brown and Bigelow Co., Series 1979-2, 7.50%, 10/01/06 ............. 769,131
855,000 IDR, Brown and Bigelow Co., Series 1979-2, 7.50%, 10/01/07 ............. 825,631
915,000 IDR, Brown and Bigelow Co., Series 1979-2, 7.50%, 10/01/08 ............. 882,033
670,000 IDR, Brown and Bigelow Co., Series 1979-2, 7.50%, 10/01/09 ............. 644,821
Minnesota (cont.)
St. Paul Port Authority, (cont.)
$ 2,010,000 IDR, Refunding, Common Bond Fund, 8.00%, 12/01/12 ...................... $ 1,688,400
2,000,000 IDR, Series 1990-C, 7.95%, 09/01/10 .................................... 1,700,000
9,750,000 Southern Minnesota Municipal Power Agency, Supply System Revenue,
Series A, Pre-Refunded, 8.125%, 01/01/18 ................................. 10,725,000
Washington County Housing RDA,
3,000,000 Housing Development Revenue, Orleans Apartments, Project A, 8.25%,
07/01/21 .............................................................. 3,037,200
5,210,000 Housing Development Revenue, Raymie Johnson Apartments,
Pre-Refunded, 7.70%, 12/01/19 ......................................... 6,151,864
10,000,000 Pooled Housing and Redevelopment, 7.20%, 01/01/22 ...................... 10,448,200
-------------
192,792,980
-------------
Mississippi .2%
5,700,000 Claiborne County, PCR, Refunding, Systems Energy Resources, Inc., 7.30%,
05/01/25 ................................................................. 5,969,097
2,345,000 Mississippi Home Corp., SFR, Refunding, Senior Series A, FGIC Insured,
9.25%, 03/01/12 .......................................................... 2,555,534
2,490,000 Mississippi State Educational Facilities Authority Revenue, Private Nonprofit
Institutions of Higher Learning, Tougaloo College Project, Series A, 6.50%,
06/01/18 2,472,346
-------------
10,996,977
-------------
Missouri 1.0%
10,000,000 Kansas City School District Building Corp., Leasehold Revenue, Capital
Improvement Project, Series A, FGIC Insured, Pre-Refunded, 7.90%, 02/01/08 10,999,900
1,560,000 Marion County Nursing Home District Revenue, Refunding, Pre-Refunded,
9.00%, 08/01/03 .......................................................... 1,700,634
Missouri State Health and Educational Facilities Authority Revenue,
5,000,000 Series B, MBIA Insured, 6.25%, 02/15/12 ................................ 5,226,000
3,750,000 Sisters of St. Mary's Health Care Project, BIG Insured, Pre-Refunded,
7.75%, 06/01/16 ....................................................... 4,148,963
Moberly IDA, Hospital Revenue, Refunding, Moberly Regional Medical Center,
Inc., Project,
4,625,000 Pre-Refunded, 8.625%, 03/01/02 ......................................... 4,985,935
8,955,000 Pre-Refunded, 8.75%, 03/01/16 .......................................... 10,066,942
1,505,000 Pre-Refunded, 8.75%, 03/01/16 .......................................... 1,639,652
5,005,000 Newton County IDA, Hospital Revenue, Refunding, Sale Hospital, Inc. Project,
Pre-Refunded, 9.00%, 01/01/05 ............................................ 5,499,644
Missouri (cont.)
$ 16,250,000 St. Louis County IDA, Health Facilities Revenue, Refunding & Improvement,
First Mortgage, Normandy Osteopathic Hospitals Project, 9.125%, 08/01/13 . $ 17,160,163
6,000,000 St. Louis Parking Facilities Revenue, 6.625%, 12/15/21 .................... 6,272,700
3,600,000 West Plains, IDA Hospital Revenue, Ozarks Medical Center Project, Series A,
8.625%, 09/15/20 ......................................................... 3,912,048
-------------
71,612,581
-------------
Montana .4%
10,000,000 Forsyth County, PCR, Puget Sound Power and Light Co. Project, AMBAC
Insured, 6.80%, 03/01/22 ................................................. 10,771,900
3,250,000 Forsyth PCR, Refunding, The Montana Power Co., Colstrip Project, Series A,
6.125%, 05/01/23 ......................................................... 3,265,048
Montana State Board Housing, Refunding, SF Program,
2,835,000 Series A, 6.50%, 12/01/22 .............................................. 2,891,190
6,800,000 Series B-1, 6.25%, 12/01/21 ............................................ 6,944,160
2,000,000 Montana State Health Facilities Authority Revenue, Montana Developmental
Center Project, 6.40%, 06/01/16 .......................................... 2,080,920
-------------
25,953,218
-------------
Nebraska .1%
6,400,000 Nebraska Investment Financial Authority, 7.00%, 11/01/09 .................. 6,761,088
-------------
Nevada 3.5%
2,000,000 Churchill County Health Care Facilities Revenue, Western Health Network,
Series A, MBIA Insured, 6.25%, 01/01/14 .................................. 2,066,620
17,500,000 Clark County Airport System Improvement Revenue, 8.25%, 07/01/15 .......... 18,909,275
5,120,000 Clark County HFC, MFHR, FHA Insured, 7.75%, 07/01/23 ...................... 5,282,509
Clark County IDR,
12,500,000 Refunding, Nevada Power Co. Project, Series C, 7.20%, 10/01/22 ......... 13,248,500
18,080,000 Southwest Gas Corp., Series A, 7.30%, 09/01/27 ......................... 19,074,942
62,470,000 Southwest Gas Corp., Series B, 7.50%, 09/01/32 ......................... 65,878,988
4,500,000 Humboldt County PCR, Refunding, Sierra Pacific Power Co., Series A,
AMBAC Insured, 6.30%, 07/01/22 ........................................... 4,636,890
5,405,000 Nevada Housing Division, Multi-Unit Housing Revenue, Issue B, 6.55%, 10/01/25
5,580,663
8,210,000 Nevada Housing Division, Refunding, Issue C-2, 6.75%, 10/01/26 ............ 8,400,226
Nevada Housing Division, SF Program,
3,795,000 Issue 1988-A, FI/GML, 8.30%, 10/01/19 .................................. 3,986,040
3,760,000 Issue 1988 A2, FI/GML, 8.375%, 10/01/19 ................................ 3,979,546
3,900,000 Refunding, Program A-1, 6.25%, 10/01/26 ................................ 3,923,400
Nevada State Colorado River,
4,790,000 Series 1994, 6.50%, 07/01/19 ........................................... 5,067,916
Nevada (cont.)
Nevada State Colorado River, (cont.)
$ 15,915,000 Series 1994, 6.50%, 07/01/24 ........................................... $ 16,782,686
31,345,000 Series 1994, 5.50%, 07/01/27 ........................................... 29,855,486
10,275,000 Nevada State Municipal Bond Bank Project No. 40-41-A, ETM 02/01/10,
6.375%, 12/01/17 ......................................................... 11,415,628
Reno RDA, Tax Allocation, Downtown Redevelopment Project,
2,695,000 Series C, 7.75%, 09/01/05 .............................................. 2,982,934
8,290,000 Series D, 7.625%, 09/01/16 ............................................. 8,863,005
5,000,000 Washoe County Gas and Water Facilities Revenue, Refunding, AMBAC
Insured, 6.30%, 12/01/14 ................................................. 5,172,100
Washoe County Hospital Facility Revenue, Washoe Medical Center, Inc. Project,
9,295,000 Series A, AMBAC Insured, 6.25%, 06/01/13 ............................... 9,614,283
5,250,000 Series A, Pre-Refunded, 7.50%, 06/01/16 ................................ 5,459,370
-------------
250,181,007
-------------
New Hampshire 1.8%
New Hampshire Higher Education and Health Facilities Authority Revenue,
9,730,000 Kendal at Hanover Project, 8.00%, 10/01/19 ............................. 9,983,369
2,300,000 St. Joseph Hospital, 7.50%, 01/01/16 ................................... 2,442,646
New Hampshire State HFA,
4,920,000 MFHR, Series 1, 7.10%, 01/01/14 ........................................ 5,140,514
4,635,000 SF Residential, Series A, 8.50%, 07/01/14 .............................. 4,894,143
7,070,000 SFMR, Series E, 6.75%, 07/01/19 ........................................ 7,304,229
5,295,000 SFMR, Series E, 6.80%, 07/01/25 ........................................ 5,470,000
New Hampshire State IDA,
12,480,000 PCR, New England Power Co., 7.80%, 04/01/16 ............................ 12,885,974
6,870,000 Pollution Control Public Service Co., Project A, 7.65%, 05/01/21 ....... 7,316,962
50,690,000 Pollution Control Public Service Co., Project B, 7.50%, 05/01/21 ....... 54,004,112
7,450,000 Pollution Control Public Service Co., Project C, 7.65%, 05/01/21 ....... 7,934,697
1,820,000 Resource Recovery Revenue, SES Concord Co. Project, 8.15%, 01/01/00 .... 1,949,930
5,000,000 Resource Recovery Revenue, SES Concord Co. Project, 8.50%, 01/01/09 .... 5,379,400
-------------
124,705,976
-------------
New Jersey .2%
4,425,000 New Jersey EDA, First Mortgage Gross Revenue, Mega Care, Inc. Project,
Pre-Refunded, 8.625%, 08/01/07 ........................................... 4,842,322
New Jersey Health Care Facilities, Financing Authority Revenue,
3,975,000 Cathedral Health Service, 7.25%, 02/15/21 .............................. 4,303,693
900,000 Community Memorial Hospital Association, Series C, 8.00%, 07/01/14 ..... 985,257
4,150,000 Zurbrugg Memorial Hospital Issue, Series C, 8.50%, 07/01/12 ............ 4,334,011
-------------
14,465,283
-------------
New Mexico 1.7%
$ 5,000,000 Albuquerque Airport Revenue, Series A, Pre-Refunded, 9.25%, 07/01/19 ...... $ 5,480,750
10,435,000 Farmington PCR, Refunding, Public Service Co. of New Mexico, Series A,
AMBAC Insured, 6.375%, 12/15/22 .......................................... 10,906,871
Las Cruces Revenue,
2,500,000 aMBIA Insured, 5.50%, 12/01/11 .......................................... 2,442,525
1,250,000 aMBIA Insured, 5.50%, 12/01/15 .......................................... 1,197,213
17,000,000 Lordsburg PCR, Refunding, Phelps Dodge Corp. Project, 6.50%, 04/01/13 ..... 17,814,810
38,705,000 Los Alamos County, Inc., Utility System Revenue, Refunding, Series 1986-A,
Pre-Refunded, 7.75%, 01/01/15 ............................................ 41,048,975
18,460,000 New Mexico State Mortgage Financial Authority, SFM, Refunding, Series A,
6.85%, 07/01/10 .......................................................... 19,442,072
17,000,000 University of New Mexico, University Revenue, Series 1989, Pre-Refunded,
7.90%, 06/01/19 .......................................................... 19,239,920
-------------
117,573,136
-------------
New York 10.7%
Metropolitan Transportation Authority Revenue,
3,000,000 Refunding, Transit Facilities Obligation, 7.00%, 07/01/09 .............. 3,280,140
18,210,000 Refunding, Transportation Facilities, Series M, 6.00%, 07/01/14 ........ 18,208,179
1,245,000 New Rochelle IDA, Civic Facilities Revenue, College of New Rochelle Project,
6.625%, 07/01/12 ......................................................... 1,288,338
New York City GO,
5,000,000 Refunding, Series A, 6.25%, 08/01/16 ................................... 5,039,550
1,500,000 Refunding, Series B, 6.20%, 08/15/06 ................................... 1,549,860
26,875,000 Refunding, Series B, 6.30%, 08/15/08 ................................... 27,591,756
21,740,000 Refunding, Series B, 6.375%, 08/15/10 .................................. 22,271,326
8,500,000 aRefunding, Series E, 5.75%, 02/15/09 ................................... 8,283,675
95,000 Series 1986-D, Pre-Refunded, 8.50%, 08/01/16 ........................... 99,759
1,705,000 Series 1986-D, Pre-Refunded, 8.50%, 08/01/16 ........................... 1,795,859
1,180,000 Series 1987-A, Pre-Refunded, 8.50%, 11/01/12 ........................... 1,296,454
3,355,000 Series 1987-A, Pre-Refunded, 8.50%, 11/01/13 ........................... 3,686,105
2,805,000 Series 1987-A, Pre-Refunded, 8.75%, 11/01/14 ........................... 3,092,288
2,040,000 Series 1987-D, Pre-Refunded, 8.50%, 08/01/09 ........................... 2,229,965
11,750,000 Series 1988-A, Pre-Refunded, 8.00%, 08/15/07 ........................... 12,294,495
7,870,000 Series 1988-A, Pre-Refunded, 8.00%, 08/15/08 ........................... 8,234,696
5,500,000 Series 1988-A, Pre-Refunded, 8.00%, 08/15/09 ........................... 5,754,870
6,500,000 Series 1988-A, Pre-Refunded, 8.00%, 08/15/10 ........................... 6,801,210
6,500,000 Series 1989-A, Pre-Refunded, 8.00%, 08/15/11 ........................... 6,801,210
2,610,000 Series 1989-E, 6.50%, 12/01/12 ......................................... 2,647,010
7,000,000 Series 1990-B, 7.50%, 10/01/11 ......................................... 7,666,820
New York (cont.)
New York City GO, (cont.)
$ 10,985,000 Series 1990-B, 7.50%, 10/01/12 ......................................... $ 12,043,734
3,000,000 Series 1990-B, ETM 06/01/01, 8.00%, 06/01/01 ........................... 3,507,870
1,000,000 Series 1991-A, 8.00%, 03/15/12 ......................................... 1,154,790
10,000,000 Series 1991-A, 7.75%, 08/15/13 ......................................... 11,369,900
7,000,000 Series 1991-A, 7.75%, 08/15/14 ......................................... 7,966,420
3,285,000 Series 1991-A, 7.75%, 08/15/17 ......................................... 3,720,920
5,000 Series 1991-A, 8.00%, 08/15/20 ......................................... 5,779
15,000 Series 1991-A, 8.00%, 08/15/21 ......................................... 17,338
13,400,000 Series 1991-A, Pre-Refunded, 8.00%, 03/15/14 ........................... 15,474,186
1,115,000 Series 1991-A, Pre-Refunded, 8.00%, 03/15/15 ........................... 1,285,182
3,000,000 Series 1991-A, Pre-Refunded, 8.00%, 03/15/16 ........................... 3,457,890
895,000 Series 1991-A, Pre-Refunded, 8.00%, 08/15/20 ........................... 1,064,245
3,165,000 Series 1991-A, Pre-Refunded, 8.00%, 08/15/21 ........................... 3,763,502
10,000,000 Series 1991-B, 7.50%, 02/01/04 ......................................... 11,050,000
1,000,000 Series 1991-B, 8.25%, 06/01/05 ......................................... 1,175,620
15,000,000 Series 1991-B, 7.00%, 02/01/19 ......................................... 15,820,950
20,000,000 Series 1991-C, 7.00%, 08/01/18 ......................................... 21,146,400
1,760,000 Series 1991-D, 8.00%, 08/01/99 ......................................... 1,942,477
1,800,000 Series 1991-D, 8.25%, 08/01/11 ......................................... 2,096,316
490,000 Series 1991-D, 8.25%, 08/01/12 ......................................... 571,463
10,635,000 Series 1991-D, Pre-Refunded, 8.25%, 08/01/12 ........................... 12,738,497
145,000 Series 1991-D, 8.25%, 08/01/13 ......................................... 169,106
7,605,000 Series 1991-D, Pre-Refunded, 8.25%, 08/01/13 ........................... 9,109,193
85,000 Series 1991-D, 8.25%, 08/01/14 ......................................... 98,993
50,000 Series 1991-D, 8.00%, 08/01/16 ......................................... 58,241
100,000 Series 1991-D, 8.00%, 08/01/17 ......................................... 115,503
50,000 Series 1991-D, 8.00%, 08/01/18 ......................................... 57,751
30,000 Series 1991-D, 8.00%, 08/01/19 ......................................... 34,651
240,000 Series 1991-D, ETM 08/01/99, 8.00%, 08/01/99 ........................... 270,120
4,255,000 Series 1991-D, Pre-Refunded, 8.25%, 08/01/14 ........................... 5,096,596
2,450,000 Series 1991-D, Pre-Refunded, 8.00%, 08/01/16 ........................... 2,903,912
4,600,000 Series 1991-D, Pre-Refunded, 8.00%, 08/01/17 ........................... 5,452,242
3,185,000 Series 1991-D, Pre-Refunded, 8.00%, 08/01/18 ........................... 3,784,003
1,970,000 Series 1991-D, Pre-Refunded, 8.00%, 08/01/19 ........................... 2,340,498
5,335,000 Series 1991-F, 8.20%, 11/15/04 ......................................... 6,219,330
160,000 Series 1991-F, 8.25%, 11/15/15 ......................................... 187,842
200,000 Series 1991-F, 8.25%, 11/15/17 ......................................... 234,802
1,840,000 Series 1991-F, Pre-Refunded, 8.25%, 11/15/15 ........................... 2,224,266
2,300,000 Series 1991-F, Pre-Refunded, 8.25%, 11/15/17 ........................... 2,780,332
New York (cont.)
New York City GO, (cont.)
$ 9,300,000 Series 1992-B, 6.75%, 10/01/15 ......................................... $ 9,690,693
1,930,000 Series 1992-C, Sub-Series C-1, 7.00%, 08/01/17 ......................... 2,040,628
5,000,000 Series 1992-D, 7.30%, 02/01/01 ......................................... 5,440,150
9,000,000 Series 1992-D, 7.625%, 02/01/15 ........................................ 9,854,280
5,000,000 Series 1992-D, 7.50%, 02/01/16 ......................................... 5,442,450
12,000,000 Series 1992-D, 7.50%, 02/01/17 ......................................... 13,061,880
3,000,000 Series 1992-H, 7.10%, 02/01/12 ......................................... 3,184,380
10,000,000 Series 1992-H, 7.20%, 02/01/14 ......................................... 10,730,500
4,000,000 Series 1992-H, 7.00%, 02/01/16 ......................................... 4,218,920
1,850,000 Series 1993-A, Pre-Refunded, 8.00%, 03/15/13 ........................... 2,136,362
460,000 Series 1993-B, 8.50%, 08/01/09 ......................................... 497,536
11,660,000 Series 1993-B, Pre-Refunded, 8.00%, 03/15/17 ........................... 13,464,851
14,500,000 Series 1994-A, 6.125%, 08/01/06 ........................................ 14,894,545
21,810,000 Series 1994-A, 6.20%, 08/01/07 ......................................... 22,340,201
4,390,000 Series 1994-A, 6.25%, 08/01/08 ......................................... 4,482,453
8,000,000 Series 1994-B, Sub-Series B-1, 7.30%, 08/15/11 ......................... 8,702,800
3,000,000 Series 1994-B, Sub-Series B-1, 7.00%, 08/15/16 ......................... 3,192,480
11,750,000 Series 1994-H, Sub-Series H-1, 6.125%, 08/01/09 ........................ 11,835,893
5,000,000 Series 1994-H, Sub-Series H-1, 6.125%, 08/01/11 ........................ 5,016,950
8,050,000 Series 1995-F, 6.50%, 02/15/07 ......................................... 8,443,323
7,540,000 Series 1995-F, 6.50%, 02/15/08 ......................................... 7,857,509
16,000,000 Series 1995-F, 6.60%, 02/15/10 ......................................... 16,670,240
5,000,000 Series 1995-F, 7.25%, 08/15/24 ......................................... 5,346,200
735,000 Series B, 8.00%, 06/01/98 .............................................. 790,978
700,000 Series B, Pre-Refunded, 8.00%, 06/01/98 ................................ 765,562
2,325,000 Series B, 8.25%, 06/01/02 .............................................. 2,595,145
2,175,000 Series B, Pre-Refunded, 8.25%, 06/01/02 ................................ 2,695,466
1,300,000 Series B, 6.75%, 10/01/17 .............................................. 1,354,613
6,425,000 aSeries D, 6.00%, 02/15/25 .............................................. 6,226,403
New York City Health and Hospital Authority Local Government Revenue,
5,010,000 Series A, 6.00%, 02/15/07 .............................................. 4,897,225
17,735,000 Series A, 6.30%, 02/15/20 .............................................. 17,494,159
New York City Municipal Water Finance Authority, Water and Sewer System
Revenue,
11,140,000 Series 1986-B, Pre-Refunded, 7.875%, 06/15/16 ............................. 11,634,505
8,500,000 Series 1987-A, Pre-Refunded, 9.00%, 06/15/17 .............................. 9,320,505
2,965,000 Series 1989-B, Pre-Refunded, 7.00%, 06/15/19 .............................. 3,216,076
2,455,000 Series 1994-A, 7.10%, 06/15/12 ............................................ 2,726,989
4,980,000 Series 1994-A, 7.00%, 06/15/15 ............................................ 5,492,143
New York (cont.)
New York State Dormitory Authority Revenue,
$ 4,000,000 City University General Resources, Series 2, MBIA Insured, 6.25%, 07/01/19 $ 4,140,040
12,150,000 City University System Consolidated, Series F, Pre-Refunded, 7.875%,
07/01/17 .............................................................. 14,137,133
4,240,000 State University Educational Facilities, Series B, Refunding, 7.375%,
05/15/14 .............................................................. 4,635,634
2,000,000 State University Educational Facilities, Series B, Refunding, 7.00%, 05/15/16 2,135,180
New York State Energy Research and Development Authority, Electric Facilities
Revenue,
5,000,000 Consolidated Edison Co., Inc. Project B, 9.25%, 09/15/22 ............... 5,474,300
17,500,000 Long Island Light, Series A, 7.15%, 06/01/20 ........................... 17,823,575
1,500,000 Long Island Light, Series A, 7.15%, 02/01/22 ........................... 1,527,735
8,500,000 Refunding, Consolidated Edison Co., Inc., Series A, 6.10%, 08/15/20 .... 8,591,120
New York State Housing Finance Agency Service Contract Revenue,
15,000,000 Refunding, Series C, 6.125%, 03/15/20 .................................. 15,026,100
3,155,000 Series A, 6.375%, 09/15/14 ............................................. 3,235,484
3,785,000 Series A, 6.375%, 09/15/16 ............................................. 3,851,389
10,000,000 Series A, 6.50%, 03/15/25 .............................................. 10,316,300
New York State Local Government Assistance Corp.,
6,000,000 Series A, 6.50%, 04/01/20 .............................................. 6,319,740
4,000,000 Series C, 5.50%, 04/01/22 .............................................. 3,781,840
New York State Medical Care Facilities, Financial Agency Revenue,
7,215,000 Hospital and Nursing Home, FSA Mortgage Insured, 6.50%, 02/15/34 ....... 7,521,710
11,210,000 Hospital and Nursing Home, Refunding, FSA Mortgage Insured, 6.40%,
08/15/14 .............................................................. 11,936,744
7,600,000 Hospital Mortgage, Series A, AMBAC Insured, 6.50%, 08/15/29 ............ 8,054,556
12,500,000 The Hospital for Special Surgery, Series A, 6.375%, 08/15/24 ........... 12,937,000
7,160,000 New York State Power Authority Revenue and General Purpose Services,
Series CC, Refunding, 5.25%, 01/01/18 .................................... 6,748,228
New York State Tollway Authority Service Contract Revenue, Local Highway
and Bridge,
11,600,000 6.25%, 04/01/14 ........................................................ 11,788,384
5,000,000 Pre-Refunded, 7.25%, 01/01/10 .......................................... 5,693,600
7,685,000 New York State Urban Development Corp., Correctional Capital Facilities,
Series 5, 6.10%, 01/01/12 ................................................ 7,777,220
5,000,000 Warren and Washington Counties IDAR, Refunding, Adirondack Resource
Recovery Project, Series A, 7.90%, 12/15/07 .............................. 5,176,550
-------------
758,808,980
-------------
North Carolina 3.7%
Charlotte GO,
$ 3,995,000 Refunding, 5.40%, 06/01/16 ............................................. $ 3,931,440
3,965,000 Refunding, 5.40%, 06/01/17 ............................................. 3,900,291
North Carolina Eastern Municipal Power Agency, Power System Revenue,
60,480,000 Refunding, Series 1986-A, Pre-Refunded, 7.75%, 01/01/15 ................ 62,666,352
5,705,000 Refunding, Series 1987-A, Pre-Refunded, 7.50%, 01/01/15 ................ 6,041,196
18,645,000 Refunding, Series 1988-A, Pre-Refunded, 8.00%, 01/01/21 ................ 20,461,955
1,355,000 Refunding, Series 1988-A, Pre-Refunded, 8.00%, 01/01/21 ................ 1,487,045
3,250,000 Refunding, Series 1989-A, 6.50%, 01/01/24 .............................. 3,280,940
24,700,000 Refunding, Series 1991-A, 6.50%, 01/01/17 .............................. 25,229,568
6,875,000 Refunding, Series 1993-B, 6.25%, 01/01/12 .............................. 6,941,000
39,030,000 Refunding, Series 1993-B, 6.25%, 01/01/23 .............................. 39,589,690
4,000,000 Refunding, Series 1993-B, FGIC Insured, 6.25%, 01/01/23 ................ 4,111,840
2,000,000 Series 1993-C, 5.50%%, 01/01/07 ........................................ 1,944,620
15,960,000 Series 1993-G, 5.875%, 01/01/14 ........................................ 15,380,971
19,220,000 Series 1993-G, 5.75%, 12/01/16 ......................................... 18,080,062
1,355,000 Series B, 6.00%, 01/01/05 .............................................. 1,389,403
3,750,000 Series D, 5.875%, 01/01/13 ............................................. 3,637,388
North Carolina Municipal Power Agency No. 1, Catawba Electric Revenue,
Refunding,
12,435,000 5.75%, 01/01/15 ........................................................ 11,932,377
15,620,000 Series 1982, 6.25%, 01/01/17 ........................................... 15,715,594
10,000,000 Series 1985-B, Pre-Refunded, 8.50%, 01/01/17 ........................... 10,273,400
5,000,000 Wake County IPC, Financing Authority Revenue, Carolina Power and Light,
6.90%, 04/01/09 .......................................................... 5,365,550
-------------
261,360,682
-------------
North Dakota .9%
7,750,000 Dickinson Health Care Facilities Revenue, BHS Long-Term Care, Inc., 7.625%,
02/15/20 ................................................................. 8,357,058
401,000 Ellendale MFHR, Ellendale Manor Apartments Project, 9.75%, 07/01/16 ....... 412,100
Mercer County PCR,
5,000,000 Basin Electric Power Corp., Second Series, AMBAC Insured, 6.05%,
01/01/19 .............................................................. 5,097,050
3,665,000 Basin Electric Power Corp., Series 1984-A, 7.70%, 01/01/19 ............. 3,796,244
14,945,000 Basin Electric Power Corp., Series 1984-B, 8.125%, 01/01/19 ............ 15,489,446
20,090,000 Basin Electric Power Corp., Series 1984-D, 8.125%, 01/01/19 ............ 20,821,879
11,910,000 Basin Electric Power Corp., Series 1984-E, 7.00%, 01/01/19 ............. 12,575,174
839,000 Wahpeton MFHR, Evergreen Apartments Project, 9.75%, 07/01/16 .............. 862,224
-------------
67,411,175
-------------
Ohio 1.2%
$ 6,740,000 Franklin County Hospital Facility Mortgage Revenue, Refunding, Presbyterian
Retirement Services, Series 1987-A, 9.00%, 07/01/10 ...................... $ 7,139,210
2,865,000 Franklin County Nursing Home, First Mortgage Revenue, Volunteers of America
Care Facilities Project, 8.75%, 11/01/18 ................................. 3,033,032
Montgomery County Health Systems Revenue,
2,500,000 Franciscan, Series B-2, 8.10%, 07/01/01 ................................ 2,703,750
12,000,000 Franciscan, Series B-2, 8.10%, 07/01/18 ................................ 13,510,440
1,680,000 Muskingum County Hospital Facilities Revenue, Care One Health System,
Bethesda Hospital, 8.00%, 12/01/16 ....................................... 1,747,922
1,500,000 Muskingum County Revenue, Refunding, Franciscan Health Advisory Service,
Good Samaritan and Holy Family Hospital Project, 7.50%, 03/01/12 ......... 1,553,310
Ohio State Air Quality Development Authority Revenue,
6,325,000 Collateral Pollution Toledo Edison, Series B, 8.00%, 05/15/19 .......... 6,658,581
10,000,000 Dayton Power and Light Co. Project, 9.50%, 12/01/15 .................... 10,293,600
12,000,000 Refunding, Dayton Power and Light Co. Project, 6.10%, 09/01/30 ......... 12,242,040
1,705,000 Ohio State EDR, Good Samaritan Medical Center, Series 1990-3, 7.875%,
12/01/10 ................................................................. 1,827,231
3,250,000 Ohio State Water Development Authority Revenue, Refunding, Water
Development Dayton Power, Series A, 6.40%, 08/15/27 ...................... 3,402,848
Ohio State Water Development Facilities Authority, PCR,
4,000,000 Cleveland Electric Illumination Co. Project, Series A-1, 9.75%, 11/01/22 4,253,320
10,000,000 Cleveland Electric Illumination Co. Project, Series A-2, 9.75%, 11/01/22 10,633,300
10,000,000 Toledo Edison, Series A, 8.00%, 05/15/19 ............................... 10,527,400
-------------
89,525,984
-------------
Oklahoma 1.5%
Canadian County HFA, SFMR,
1,900,000 Series 1990-A, 7.70%, 09/01/05 ......................................... 1,990,839
3,955,000 Series 1990-A, 7.80%, 09/01/12 ......................................... 4,165,406
6,000,000 Jackson County Memorial Hospital Authority Revenue, Refunding, Jackson
Memorial Hospital Project, Pre-Refunded, 9.00%, 08/01/15 ................. 6,608,760
Oklahoma State Municipal Power Authority, Power Supply System Revenue,
7,000,000 Series A, Pre-Refunded, 8.25%, 01/01/23 ................................ 7,188,020
20,000,000 Series B, Pre-Refunded, 8.25%, 01/01/23 ................................ 20,537,200
Oklahoma State Turnpike System Authority,
19,090,000 First Senior Revenue, Pre-Refunded, 7.875%, 01/01/21 ................... 21,419,171
610,000 First Senior Revenue, Pre-Refunded, 7.875%, 01/01/21 ................... 670,500
660,000 Tulsa County Home Financial Authority, Mortgage Revenue, Series D, GNMA
Insured, 6.95%, 12/01/22 ................................................. 689,377
Oklahoma (cont.)
Tulsa County Municipal Airport Revenue, American Airlines, Inc.,
$ 10,000,000 a6.25%, 06/01/20 ........................................................ $ 9,924,900
11,000,000 7.375%, 12/01/20 ....................................................... 11,570,020
Tulsa County Parking Authority,
3,000,000 Series B, 6.90%, 12/01/07 .............................................. 3,344,100
5,500,000 Series B, 7.00%, 12/01/14 .............................................. 5,981,855
Tulsa County Public Facilities Authority,
2,000,000 Recreation Facility Revenue, Pre-Refunded, 8.875%, 02/01/03 ............ 2,235,400
2,000,000 Recreation Facility Revenue, Pre-Refunded, 9.00%, 02/01/08 ............. 2,240,700
2,740,000 Tulsa Housing Assistance Corp., First Lien Revenue, Refunding, 6.80%,
07/01/11 ................................................................. 2,846,723
2,000,000 Tulsa Industrial Authority Hospital Revenue, St. John Medical Center Project,
Series A, 6.25%, 02/15/14 ................................................ 2,050,060
4,000,000 Tulsa Municipal Airport Revenue, American Airlines-AMR Corp., 7.35%,
12/01/11 ................................................................. 4,300,040
-------------
107,763,071
-------------
Pennsylvania 4.3%
5,250,000 Allegheny County, IDAR, Environmental Improvement, 6.70%, 12/01/20 ........ 5,422,253
14,250,000 Beaver County IDA, PCR, Ohio Edison Co., Beaver Valley Project, Series A,
7.75%, 09/01/24 .......................................................... 15,101,010
Cambria County HDA, Hospital Revenue, Conemaugh Valley Memorial
Hospital, Refunding,
9,600,000 Series B, 6.30%, 07/01/08 .............................................. 10,149,696
10,740,000 Series B, 6.375%, 07/01/18 ............................................. 11,080,995
3,000,000 Series B, Pre-Refunded, 8.875%, 07/01/18 ............................... 3,396,540
Delaware County IDAR, Refunding,
6,500,000 Philadelphia Electric, Series 1991, 7.375%, 04/01/21 ................... 7,014,215
41,300,000 Resource Recovery Project, Series A, 8.10%, 12/01/13 ................... 43,066,814
22,500,000 Lancaster County Solid Waste Management Authority, Resource Recovery
System Revenue, Series A, 8.50%, 12/15/10 ................................ 24,073,875
4,000,000 Lehigh County IDA, PCR, Refunding, Pennsylvania Power and Light Co. Project,
Series A, MBIA Insured, 6.15%, 08/01/29 ................................. 4,127,920
5,000,000 Montgomery County GO, Series A, 6.10%, 10/15/25 ........................... 5,078,550
Montgomery County Higher Education and Health Authority, Hospital Revenue,
5,150,000 Frankford Hospital, Pre-Refunded, 7.875%, 01/01/19 ..................... 5,469,094
5,500,000 Jeanes Health System Project, Pre-Refunded, 8.75%, 07/01/20 ............ 6,554,130
5,000,000 Montgomery County IDA, PCR, Philadelphia Electric Co., Series 1986-A,
8.875%, 06/01/16 ......................................................... 5,214,600
5,000,000 Pennsylvania EDA, Financing Authority Revenue, Macmillan, Ltd. Partnership
Project, 7.60%, 12/01/20 ................................................. 5,540,600
Pennsylvania (cont.)
$ 13,500,000 Pennsylvania EDA, Financing Resources, Recovery Revenue Colver Project,
Series D, 7.125%, 12/01/15 ............................................... $ 14,234,265
33,280,000 Pennsylvania State Financial Authority Revenue, Refunding, Municipal Capital
Improvements Program, 6.60%, 11/01/09 .................................... 35,906,458
Pennsylvania State HFA,
10,590,000 Refunding, Rental Housing, FGIC Insured, 6.40%, 07/01/12 ............... 10,800,106
4,200,000 SFM, Series 1991, 7.15%, 04/01/15 ...................................... 4,426,254
2,000,000 Pennsylvania State Higher Educational Facilities Authority, College and
University Revenues, Lycoming College, Pre-Refunded, 8.375%, 10/01/18 .... 2,254,220
4,445,000 Pennsylvania State Pooled Finance Authority, Lease Revenue, Capital
Improvement, Series B, MBIA Insured, 8.00%, 11/01/09 ..................... 4,715,701
Philadelphia City GO, Refunding,
26,000,000 Series 1986-A, Pre-Refunded, 7.625%, 08/01/16 .......................... 27,206,660
1,000,000 Series 1987-A, 11.50%, 08/01/97 ........................................ 1,111,380
1,545,000 Series 1987-A, 11.50%, 08/01/98 ........................................ 1,803,185
2,400,000 Series 1987-A, 11.50%, 08/01/99 ........................................ 2,921,736
1,000,000 Series 1987-A, 11.50%, 08/01/00 ........................................ 1,259,300
2,850,000 Philadelphia Gas Works Revenue, Series 13, Pre-Refunded, 7.70%, 06/15/21 .. 3,334,614
3,950,000 Philadelphia Gas Works Revenue, Series A, 6.375%, 07/01/26 ................ 3,987,802
14,240,000 Philadelphia Hospital and Higher Education Facilities Authority, Hospital
Revenue, Albert Einstein Medical Center, 7.50%, 04/01/99 ................. 15,232,386
Philadelphia Housing RDAR,
355,000 Sub-Series 2-A, 8.375%, 02/01/14 ....................................... 361,493
4,140,000 Sub-Series 2-B, 8.625%, 08/01/26 ....................................... 4,215,845
1,000,000 Philadelphia Municipal Authority, Gas Works Lease Revenue, 7.50%, 05/01/01 1,102,170
7,250,000 a Philadelphia School District, Series B, AMBAC Insured, 5.50%, 09/01/25 .... 6,992,190
10,890,000 Philadelphia Water and Sewer Revenue, Series 10, ETM 09/01/04, 7.35%,
09/01/04 ................................................................. 12,697,413
3,000,000 Westmoreland County IDAR, Refunding, Citizens General Hospital Project,
Series A, 8.25%, 07/01/13 ................................................ 3,158,220
-------------
309,011,690
-------------
Puerto Rico .5%
15,750,000 Puerto Rico Commonwealth, Series 1994, 6.50%, 07/01/23 .................... 16,705,868
3,200,000 Puerto Rico Commonwealth Urban Renewal and Housing Corp., Refunding,
7.875%, 10/01/04 ......................................................... 3,638,176
Puerto Rico Electric Power Authority, Power Revenue, Refunding,
4,000,000 Series 1987-K, Pre-Refunded, 9.375%, 07/01/17 .......................... 4,424,960
2,000,000 Series 1988-M, Pre-Refunded, 8.00%, 07/01/08 ........................... 2,234,260
5,000,000 Puerto Rico Municipal Finance Agency, Series 1988-A, 8.25%, 07/01/08 ...... 5,507,150
-------------
32,510,414
-------------
Rhode Island 1.3%
$ 9,900,000 Providence Special Obligation Tax Increment, Series A, 7.65%, 06/01/16 .... $ 10,898,415
2,200,000 Rhode Island Clean Water Financial Agency Revenue, Drinking Water
Providence, Series A, AMBAC Insured, 6.70%, 01/01/15 ..................... 2,383,392
Rhode Island Housing and Mortgage Finance Corp., Homeownership
Opportunity,
1,925,000 Series 2, 7.75%, 04/01/22 .............................................. 2,038,787
20,200,000 Series 10-A, 6.50%, 10/01/22 ........................................... 20,580,972
13,085,000 Series 10-A, 6.50%, 04/01/27 ........................................... 13,287,032
7,400,000 Series 13, 6.70%, 10/01/15 ............................................. 7,707,544
4,185,000 Series 13, 6.85%, 04/01/27 ............................................. 4,374,413
15,000,000 Series 15-A, 6.85%, 10/01/24 ........................................... 15,809,250
2,720,000 Series 16-A, 6.375%, 10/01/26 .......................................... 2,730,853
2,320,000 Series 17-A, 6.25%, 04/01/17 ........................................... 2,350,044
3,000,000 Rhode Island Port Authority and Economic Development Corp., Refunding,
Shepard Building Project, Series B, AMBAC Insured, 6.75%, 06/01/25 ....... 3,240,030
Rhode Island State Health and Educational Building Corp. Revenue,
3,000,000 Health Facilities Tockwotton Home, 7.25%, 04/15/17 ..................... 3,241,470
955,000 Roger William Realty, FHA Insured, 7.50%, 08/01/29 ..................... 1,011,307
2,320,000 St. Antoine Residence, 6.70%, 11/15/12 ................................. 2,386,422
2,750,000 St. Antoine Residence, 6.75%, 11/15/18 ................................. 2,828,540
-------------
94,868,471
-------------
South Carolina 1.4%
1,800,000 Berkeley County School District COP, Berkeley School Facilities Group, Inc.,
AMBAC Insured, 6.30%, 02/01/16 ........................................... 1,897,020
24,000,000 Charleston County Resource Recovery Revenue, Foster Wheeler, Inc. Project,
Series A, 9.25%, 01/01/10 ................................................ 26,423,520
5,000,000 Myrtle Beach COP, Myrtle Beach Convention Center Project, 6.875%, 07/01/17 5,236,600
Piedmont Municipal Power Agency, South Carolina Electric Revenue,
6,700,000 Refunding, 7.25%, 01/01/22 ............................................. 6,859,058
5,500,000 Refunding, 6.375%, 01/01/25 ............................................ 5,565,890
3,150,000 Refunding, Series A, 5.75%, 01/01/24 ................................... 2,962,008
5,050,000 Refunding, Series A, AMBAC Insured, 5.75%, 01/01/24 .................... 4,973,341
3,000,000 Richland County PCR, Refunding, Union Camp Corp. Project, Series C,
6.55%, 11/01/20 .......................................................... 3,183,990
South Carolina State Public Service Authority Revenue, Refunding,
2,760,000 Electric System and Expansion, Series A, Pre-Refunded, 7.875%, 07/01/21 2,832,864
13,045,000 Electric System and Expansion, Series A, Pre-Refunded, 7.875%, 07/01/21 13,389,388
4,175,000 Electric System and Expansion, Series A, Pre-Refunded, 7.875%, 07/01/21 4,285,220
South Carolina (cont.)
South Carolina State Public Service Authority Revenue, Refunding, (cont.)
$ 12,765,000 Series A, AMBAC Insured, 6.375%, 07/01/21 .............................. $ 13,161,481
10,000,000 Series B, 6.00%, 07/01/31 .............................................. 10,008,500
-------------
100,778,880
-------------
South Dakota .5%
5,000,000 Lawrence County PCR, Refunding, Black Hills Power and Light Co. Project,
6.70%, 06/01/10 .......................................................... 5,382,700
South Dakota State HDA, Homeownership Mortgage,
6,000,000 Series A, 6.30%, 05/01/17 .............................................. 6,068,400
10,580,000 Series A, 7.15%, 05/01/27 .............................................. 11,033,670
3,205,000 Series B, 7.10%, 05/01/17 .............................................. 3,352,398
3,480,000 Series D, 6.65%, 05/01/14 .............................................. 3,634,964
5,000,000 Series G, 7.125%, 05/01/14 ............................................. 5,364,850
-------------
34,836,982
-------------
Tennessee .8%
6,690,000 Gatlinburg COP, Gatlinburg Convention Center, Inc., Pre-Refunded, 9.25%,
12/01/12 ................................................................. 7,549,264
4,835,000 Knox County Health, Educational and Housing Facilities Board, MFHR, GNMA
Secured, East Towne Village Project, 8.20%, 07/01/28 ..................... 5,074,333
Memphis-Shelby County Airport Authority, Special Facilities and Project
Revenue,
14,690,000 Federal Express Corp., 7.875%, 09/01/09 ................................ 16,330,432
6,520,000 Federal Express Corp., 6.75%, 09/01/12 ................................. 6,887,206
1,940,000 Metropolitan Nashville Airport Authority, Airport Revenue, Series C, FGIC
Insured, 6.60%, 07/01/15 ................................................. 2,060,552
1,990,000 Mount Pleasant IDR, PCR, Stauffer Chemical Co. Project, 8.00%, 12/01/12 ... 2,265,197
5,000,000 Nashville and Davidson County Revenue, IDB, Refunding & Improvement,
Osco Treatment, Inc., 6.00%, 05/01/03 .................................... 5,057,000
Tennessee HDA, Homeownership Program,
2,650,000 Series 1992, 6.80%, 07/01/17 ........................................... 2,742,459
6,135,000 Series P, 7.70%, 07/01/16 .............................................. 6,422,363
2,275,000 Tennessee State Local Development Authority Revenue, Community Provider
Pooled Loan Program, 6.45%, 10/01/14 ..................................... 2,374,463
-------------
56,763,269
-------------
Texas 7.6%
18,100,000 Austin Combined Utility System Revenue, Series A, Pre-Refunded, 8.00%,
11/15/16 ................................................................. 21,095,007
30,000 Austin HFC, SFMR, Series 1984, 11.25%, 02/01/09 ........................... 30,549
Texas (cont.)
$ 11,310,000 Austin Utility System Revenue Refunding, FGIC Insured, 6.25%, 05/15/16 .... $ 11,804,473
4,500,000 Bexar County Health Facilities Development Corp. Revenue, Incarnate Word
Facility, FSA Insured, 6.00%, 11/15/15 ................................... 4,573,125
1,750,000 Bexar County HFC, MFHR, Sunpark Apartments Project, 6.875%, 12/01/12 ...... 1,828,418
6,100,000 Brazos County Health Facilities Development Corp., Hospital Revenue, St.
Joseph Hospital Project, Pre-Refunded, 10.25%, 10/01/15 .................. 6,889,218
Brazos River Authority, Collateralized, PCR, Texas Utilities Electric Co. Project,
2,500,000 Series 1987-A, 9.875%, 10/01/17 ........................................ 2,745,975
17,550,000 Series 1988-A, 9.25%, 03/01/18 ......................................... 19,300,788
15,000,000 Series 1989-A, 8.25%, 01/01/19 ......................................... 16,414,500
Brazos River Authority, Johnson County,
480,000 Surface Water and Treatment Revenue, 8.75%, 09/01/97 ................... 493,690
520,000 Surface Water and Treatment Revenue, 8.90%, 09/01/98 ................... 534,383
560,000 Surface Water and Treatment Revenue, 9.00%, 09/01/99 ................... 574,795
605,000 Surface Water and Treatment Revenue, 9.00%, 09/01/00 ................... 620,240
655,000 Surface Water and Treatment Revenue, 9.00%, 09/01/01 ................... 670,969
705,000 Surface Water and Treatment Revenue, 9.10%, 09/01/02 ................... 722,174
765,000 Surface Water and Treatment Revenue, 9.10%, 09/01/03 ................... 783,008
825,000 Surface Water and Treatment Revenue, 9.10%, 09/01/04 ................... 844,421
890,000 Surface Water and Treatment Revenue, 9.20%, 09/01/05 ................... 911,298
960,000 Surface Water and Treatment Revenue, 9.20%, 09/01/06 ................... 982,973
1,040,000 Surface Water and Treatment Revenue, 9.20%, 09/01/07 ................... 1,064,045
1,120,000 Surface Water and Treatment Revenue, 9.20%, 09/01/08 ................... 1,145,894
1,210,000 Surface Water and Treatment Revenue, 9.25%, 09/01/09 ................... 1,237,467
1,310,000 Surface Water and Treatment Revenue, 9.25%, 09/01/10 ................... 1,339,737
1,415,000 Surface Water and Treatment Revenue, 9.25%, 09/01/11 ................... 1,446,555
1,525,000 Surface Water and Treatment Revenue, 9.25%, 09/01/12 ................... 1,559,008
1,650,000 Surface Water and Treatment Revenue, 9.25%, 09/01/13 ................... 1,686,795
1,780,000 Surface Water and Treatment Revenue, 9.25%, 09/01/14 ................... 1,819,694
1,670,000 Surface Water and Treatment Revenue, 9.25%, 09/01/15 ................... 1,707,241
3,470,000 Dallas County Flood Control District No. 1, Refunding, Pre-Refunded, 9.25%,
04/01/10 ................................................................. 3,713,351
99,000,000 Dallas-Fort Worth International Airport Facilities, Improvement Corp. Revenue,
American Airlines, Inc., 8.00%, 11/01/24.................................. 107,257,590
5,995,000 El Paso HFC, SFMR, Series 1991-A, 8.75%, 10/01/11 ......................... 6,348,345
2,700,000 Grand Prairie Health Facilities Development Corp., Hospital Revenue,
Refunding, Dallas/FT Worth Medical Center Project, AMBAC Insured,
6.875%, 11/01/10 ......................................................... 2,961,414
1,460,000 Grand Prairie HFC, SFMR, 10.75%, 09/01/14 ................................. 1,501,537
Texas (cont.)
$ 43,010,000 Harris County Hospital District, Mortgage Revenue, Refunding, Pre-Refunded,
8.50%, 04/01/05 .......................................................... $ 44,655,563
20,250,000 Harris County IDR, Marine Terminal Revenue, Refunding, 6.95%, 02/01/22 .... 21,511,170
Harris County Toll Road, Multiple Mode, Senior Lien Revenue,
2,100,000 Refunding, Series 1987, Pre-Refunded, 8.70%, 08/15/17 .................. 2,323,650
9,000,000 Series B, Pre-Refunded, 8.625%, 08/15/07 ............................... 9,946,980
18,710,000 Series B, Pre-Refunded, 8.70%, 08/15/17 ................................ 20,702,615
3,500,000 Series C, Pre-Refunded, 8.125%, 08/15/17 ............................... 3,892,910
4,000,000 Series D, Pre-Refunded, 8.25%, 08/15/07 ................................ 4,524,440
5,000,000 Series D, Pre-Refunded, 8.30%, 08/15/17 ................................ 5,662,050
Houston Water and Sewer System Revenue, Refunding,
20,000,000 Junior Lien, Series A, MBIA Insured, 6.20%, 12/01/20 ................... 20,741,800
21,000,000 Series B, 6.375%, 12/01/14 ............................................. 21,931,980
Matagorda County Navigation District No. 1, PCR, Collateralized, Refunding,
6,500,000 Central Power and Light Co. Project, MBIA Insured, 6.10%, 07/01/28 ..... 6,580,795
10,000,000 Houston Lighting and Power Co., 6.00%, 07/01/28 ........................ 10,064,500
5,500,000 Houston Lighting and Power Co., Series A, AMBAC Insured, 6.70%, 03/01/27 5,944,565
40,975,000 Houston Lighting and Power Co., Series B, 7.70%, 02/01/19 .............. 43,798,997
1,530,000 Mesquite HFC, SFMR, Series 1983, 10.75%, 09/01/14 ......................... 1,542,362
5,000,000 Nueces County Hospital District Revenue, Refunding, Pre-Refunded, 9.00%,
07/01/16 ................................................................. 5,285,150
Sabine River Authority PCR,
2,610,000 Texas Utility Electric Co. Project, Refunding, 7.75%, 04/01/16 ......... 2,687,935
7,700,000 Texas Utility Electric Co. Project, Refunding, 6.55%, 10/01/22 ......... 8,096,935
5,000,000 San Antonio Water Revenue, Refunding, MBIA Insured, 6.50%, 05/15/10 ....... 5,333,250
Southland Oaks MUD,
1,525,000 Contract Revenue, Pre-Refunded, 8.50%, 11/15/01 ........................ 1,616,027
1,700,000 Contract Revenue, Pre-Refunded, 8.50%, 11/15/02 ........................ 1,801,473
1,850,000 Contract Revenue, Pre-Refunded, 8.50%, 11/15/03 ........................ 1,960,427
2,050,000 Contract Revenue, Pre-Refunded, 8.55%, 11/15/04 ........................ 2,173,390
2,250,000 Contract Revenue, Pre-Refunded, 8.55%, 11/15/05 ........................ 2,385,428
2,475,000 Contract Revenue, Pre-Refunded, 8.60%, 11/15/06 ........................ 2,625,208
2,725,000 Contract Revenue, Pre-Refunded, 8.60%, 11/15/07 ........................ 2,890,380
3,000,000 Contract Revenue, Pre-Refunded, 8.60%, 11/15/08 ........................ 3,182,070
3,300,000 Contract Revenue, Pre-Refunded, 8.60%, 11/15/09 ........................ 3,500,277
Texas Housing Agency,
14,985,000 SFMR, Series 1986-B, 7.50%, 09/01/17 ................................... 15,341,044
3,435,000 SFMR, Series 1988-B, 8.20%, 03/01/16 ................................... 3,548,733
Texas Housing Agency, Residential Development Mortgage Revenue,
1,775,000 Series D, 8.35%, 01/01/08 .............................................. 1,851,645
3,545,000 Series D, 8.35%, 07/01/08 .............................................. 3,698,073
Texas (cont.)
$ 2,500,000 Texas Water Development Board Revenue, State Revolving Fund, 6.00%,
07/15/13 ................................................................. $ 2,578,275
2,490,000 Texas Water Resources Finance Authority Revenue, 7.625%, 08/15/08 ......... 2,726,849
5,580,000 Travis County, HFC, SFMR, Refunding, Series A, 6.95%, 10/01/27 ............ 5,913,572
Western Oaks MUD,
1,675,000 Contract Revenue, 8.60%, 11/15/05 ...................................... 1,776,656
1,825,000 Contract Revenue, 8.60%, 11/15/06 ...................................... 1,935,759
615,000 Contract Revenue, Pre-Refunded, 8.40%, 11/15/01 ........................ 651,094
500,000 Contract Revenue, Pre-Refunded, 8.45%, 11/15/02 ........................ 529,595
2,025,000 Contract Revenue, Pre-Refunded, 8.60%, 11/15/07 ........................ 2,147,897
2,225,000 Contract Revenue, Pre-Refunded, 8.60%, 11/15/08 ........................ 2,360,035
2,450,000 Contract Revenue, Pre-Refunded, 8.60%, 11/15/09 ........................ 2,598,691
-------------
541,628,922
-------------
U.S. Territories
760,000 Virgin Islands HFA, HMR, Series B, GNMA Secured, 8.10%, 12/01/18 .......... 794,154
-------------
Utah 1.8%
5,050,000 Carbon County, Solid Waste Disposal Revenue, Refunding, Laidlaw, Inc.
Project, Series A, 7.50%, 02/01/10 ....................................... 5,443,496
Intermountain Power Agency, Special Obligation,
13,450,000 First Crossover, Series, 7.875%, 07/01/14 .............................. 14,056,595
9,500,000 Refunding, Fifth Crossover, Series, 7.20%, 07/01/19 .................... 10,037,700
Intermountain Power Agency, Supply Revenue,
34,805,000 Refunding, Series B, 7.75%, 07/01/20 ................................... 38,024,811
1,805,000 Second Crossover, Series 86-C, FGIC Insured, 7.25%, 07/01/17 ........... 1,877,561
5,545,000 a North Davis County, Sewer District, FGIC Insured, 5.75%, 03/01/15 ......... 5,561,025
2,945,000 Utah State HFA, Refunding, Series A, 6.50%, 05/01/19 ...................... 2,985,199
Utah State HFA, SFM,
3,135,000 Refunding, Series A-C, 6.80%, 01/01/12 ................................. 3,272,031
1,095,000 Series A, 8.50%, 07/01/19 .............................................. 1,144,166
5,000,000 Series B, 6.55%, 07/01/26 .............................................. 5,099,300
440,000 Series C-1, 6.80%, 07/01/12 ............................................ 459,232
4,165,000 Series C-1, 8.375%, 07/01/19 ........................................... 4,619,735
1,070,000 Series D, 8.60%, 07/01/19 .............................................. 1,148,249
4,990,000 Series D-1, 6.55%, 07/01/19 ............................................ 5,124,181
3,590,000 Series E-1, 6.65%, 07/01/20 ............................................ 3,688,869
1,965,000 Series G-1, 8.10%, 07/01/16 ............................................ 2,072,387
Utah State School District Finance Cooperative Revenue, Financing Pool,
2,450,000 Series 1988, 8.375%, 02/15/10 .......................................... 2,659,402
1,730,000 Series 1988, 8.375%, 02/15/10 .......................................... 1,882,551
Utah (cont.)
Utah State School District Finance Cooperative Revenue, Financing Pool, (cont.)
$ 1,435,000 Series 1988, 8.375%, 02/15/10 .......................................... $ 1,547,992
1,420,000 Series 1988, 8.375%, 02/15/10 .......................................... 1,549,078
1,340,000 Series 1988, 8.375%, 02/15/10 .......................................... 1,465,451
1,245,000 Series 1988, 8.375%, 02/15/10 .......................................... 1,364,968
1,210,000 Series 1988, 8.375%, 02/15/10 .......................................... 1,305,275
1,195,000 Series 1988, 8.375%, 02/15/10 .......................................... 1,313,424
1,190,000 Series 1988, 8.375%, 02/15/10 .......................................... 1,309,558
1,160,000 Series 1988, 8.375%, 02/15/10 .......................................... 1,252,892
1,065,000 Series 1988, 8.375%, 02/15/10 .......................................... 1,151,722
1,040,000 Series 1988, 8.375%, 02/15/10 .......................................... 1,127,817
1,030,000 Series 1988, 8.375%, 02/15/10 .......................................... 1,115,252
635,000 Series 1988, 8.375%, 02/15/10 .......................................... 666,984
530,000 Series 1988, 8.375%, 02/15/10 .......................................... 536,168
-------------
124,863,071
-------------
Vermont .1%
9,400,000 Vermont HFA, SF, Series 5, 7.00%, 11/01/27 ................................ 9,750,150
-------------
Virginia .5%
Danville IDAR, Regional Medical Center,
5,885,000 FGIC Insured, 6.50%, 10/01/19 .......................................... 6,262,640
5,840,000 FGIC Insured, 6.50%, 10/01/24 .......................................... 6,193,670
7,250,000 Henrico County IDA, Public Facilities Lease Revenue, Henrico County Regional
Jail Project, 6.00%, 08/01/15 ............................................ 7,481,202
Virginia State HDA, Commonwealth Mortgage,
5,120,000 Series 1994-C, Sub-Series C-6, 6.25%, 01/01/15 ......................... 5,215,333
5,500,000 Series B, Sub-Series B-1, 7.20%, 07/01/17 .............................. 5,998,684
4,755,000 Series H, Sub-Series H-2, 6.55%, 01/01/17 .............................. 4,933,644
-------------
36,085,173
-------------
Washington 4.3%
5,000,000 Chelan County PUD No. 1, Cheland Hydro Consolidated System Revenue,
9.30%, 07/01/62 .......................................................... 5,516,500
32,480,000 Pierce County EDC, Refunding, Solid Waste-Steilacoom Revenue, 6.60%,
08/01/22.................................................................. 33,386,841
Port Moses Lake Public Corp., Washington PCR,
2,100,000 Union Carbide Corp., 7.50%, 08/01/04 ................................... 2,153,297
1,000,000 Union Carbide Corp., 7.875%, 08/01/06 .................................. 1,053,840
2,760,000 Seatac GO, Series 1994, 6.50%, 12/01/13 ................................... 2,942,601
Washington (cont.)
Seattle Municipality, Metropolitan Seattle Sewer Revenue,
$ 9,680,000 Refunding, Series V, 6.20%, 01/01/32 ................................... $ 9,927,904
2,500,000 Series W, MBIA Insured, 6.25%, 01/01/21 ................................ 2,573,450
9,365,000 Snohomish County PUD No. 1, Electric Revenue, Refunding, Generation
System, Series 1986-A, Pre-Refunded, 8.00%, 01/01/15 ..................... 9,960,613
7,000,000 Snohomish County USD No. 6, 6.50%, 12/01/11 ............................... 7,622,720
4,000,000 University of Washington Alumni Association Lease Revenue, Medical Center
Roosevelt II, 6.30%, 08/15/14 ............................................ 4,177,640
4,850,000 Washington State Housing Finance Commission, MFMR, Refunding, Series A,
7.90%, 07/01/30 .......................................................... 5,054,815
Washington State Public Power Supply System Revenue, Nuclear Project No. 1,
Refunding,
18,330,000 Series A, 6.00%, 07/01/09 .............................................. 18,650,774
1,500,000 Series A, 7.00%, 07/01/11 .............................................. 1,599,854
22,400,000 Series A, 6.00%, 07/01/12 .............................................. 22,304,351
35,355,000 Series A, 6.05%, 07/01/12 .............................................. 35,376,920
16,150,000 Series A, 6.25%, 07/01/12 .............................................. 16,374,484
34,070,000 Series A, 6.50%, 07/01/15 .............................................. 34,880,524
19,250,000 Series A, 6.00%, 07/01/17 .............................................. 18,814,950
23,205,000 Series A, 6.25%, 07/01/17 .............................................. 23,731,521
5,900,000 Series A, 6.875%, 07/01/17 ............................................. 6,179,542
Washington State Public Power Supply System Revenue, Nuclear Project No. 2,
Refunding,
7,500,000 Series A, 6.30%, 07/01/12 .............................................. 7,702,274
4,735,000 Series A, 7.00%, 07/01/12 .............................................. 5,028,191
Washington State Public Power Supply System Revenue, Nuclear Project No. 3,
Refunding,
6,750,000 Series 1989-B, 5.50%, 07/01/17 ......................................... 6,235,582
13,350,000 Series A, 6.50%, 07/01/18 .............................................. 13,679,611
12,945,000 Series B, 5.70%, 07/01/10 .............................................. 12,804,546
-------------
307,733,345
-------------
West Virginia .9%
3,500,000 Braxton County, Solid Waste Disposal Revenue, Weyerhaeuser Co. Project,
6.50%, 04/01/25 .......................................................... 3,628,204
New Martinsville Building Commission Revenue, City of New Martinsville Project,
2,685,000 Series A, Pre-Refunded, 8.50%, 11/01/03 ................................ 2,961,098
4,250,000 Series A, Pre-Refunded, 8.75%, 11/01/09 ................................ 4,754,900
2,400,000 Taylor County PCR, Union Carbide Corp., 7.625%, 08/01/05 .................. 2,756,975
7,000,000 West Virginia State Hospital Financing Authority Revenue, Refunding &
Improvement, Logan General Hospital Project, 7.25%, 07/01/20 ............. 7,037,240
West Virginia (cont.)
West Virginia State Housing Development Fund, Housing Finance,
$ 6,000,000 Series D, 7.00%, 05/01/17 .............................................. $ 6,264,960
9,000,000 Series D, 7.05%, 11/01/24 .............................................. 9,390,690
11,750,000 West Virginia State School Building Authority Revenue, Capital Improvement,
Series A, MBIA Insured, 6.25%, 07/01/22 .................................. 12,541,480
West Virginia State Water Development Authority Revenue,
5,000,000 Loan Program II, Series 1988-A, Pre-Refunded, 8.625%, 11/01/28 ......... 5,685,000
5,180,000 Loan Program II, Series 1991-A, 7.00%, 11/01/31 ........................ 5,421,491
-------------
60,442,038
-------------
Wisconsin 1.3%
2,200,000 Janesville IDR, Simmons Manufacturing Co., 7.00%, 10/15/17 ................ 2,233,571
4,220,000 Madison Industrial Gas and Electric Co. Project, Series A, 6.75%, 04/01/27 4,423,487
Wisconsin Housing and EDA, Homeownership Revenue,
9,190,000 Refunding, Series A, 6.10%, 11/01/10 ................................... 9,365,712
10,230,000 Series 1, 6.75%, 09/01/15 .............................................. 10,755,311
3,000,000 Series 1, 6.75%, 09/01/17 .............................................. 3,143,730
2,250,000 Series A, 6.90%, 03/01/16 .............................................. 2,392,042
5,500,000 Series A, 6.45%, 03/01/17 .............................................. 5,675,064
11,330,000 Series A, 7.10%, 03/01/23 .............................................. 11,916,441
3,000,000 Series B, 7.05%, 11/01/22 .............................................. 3,136,950
Wisconsin State Health and Educational Facilities Authority Revenue,
14,995,000 Lindengrove, Inc. Project, 10.00%, 10/01/17 ............................ 16,217,691
6,500,000 Mercy Health Systems Corp., AMBAC Insured, 6.125%, 08/15/13 ............ 6,689,020
7,500,000 Mercy Health Systems Corp., AMBAC Insured, 6.125%, 08/15/17 ............ 7,653,750
7,400,000 Wisconsin State Health Facilities Authority Revenue, Refunding, Franciscan
Health Advisory, 7.80%, 03/01/14 ......................................... 7,663,070
-------------
91,265,839
-------------
Wyoming .1%
Wyoming CDA, MF Mortgage,
1,575,000 Series A, 6.90%, 06/01/12 .............................................. 1,642,063
3,530,000 Series A, 6.95%, 06/01/24 .............................................. 3,679,990
Wyoming CDA, SFM,
2,500,000 Series A, 7.25%, 06/01/21 .............................................. 2,643,600
1,730,000 Series G, 7.375%, 06/01/17 ............................................. 1,839,491
-------------
9,805,144
-------------
Total Bonds (Cost $6,493,824,025) ................................... 6,893,242,570
-------------
c Zero Coupon Bonds 1.4%
$ 11,040,000 Calcasieu Parish, Memorial Hospital Service District Revenue, Lake Charles
Parish Memorial Hospital Project, Series A, (original accretion rate 5.59%),
12/01/22 ................................................................. $ 6,120,355
15,160,000 Chicago Residential Mortgage Revenue, Refunding, Series B, MBIA Insured,
(original accretion rate 7.30%), 10/01/09 ................................ 5,821,288
5,935,000 Coldwater Community Schools, MBIA Insured, (original accretion rate 6.794%),
05/01/18 ................................................................. 1,527,906
Colorado Springs Airport Revenue,
1,660,000 Series C, (original accretion rate 6.86%), 01/01/03 .................... 1,134,212
1,610,000 Series C, (original accretion rate 6.966%), 01/01/05 ................... 966,370
1,675,000 Series C, (original accretion rate 7.07%), 01/01/07 .................... 877,214
800,000 Series C, (original accretion rate 7.07%), 01/01/08 .................... 388,432
1,450,000 Series C, (original accretion rate 7.176%), 01/01/11 ................... 545,751
Cook County, Community Consolidated School District, No. 54 Schaumburg
Township,
3,505,000 Series B, FGIC Insured, (original accretion rate 6.50%), 01/01/07 ...... 1,824,983
4,800,000 Series B, FGIC Insured, (original accretion rate 6.55%), 01/01/08 ...... 2,320,272
4,380,000 Series B, FGIC Insured, (original accretion rate 6.60%), 01/01/09 ...... 1,956,721
5,760,000 Series B, FGIC Insured, (original accretion rate 6.60%), 01/01/10 ...... 2,400,710
6,000,000 Harrison Community Schools, AMBAC Insured, (original accretion rate 6.90%),
05/01/20 ................................................................. 1,338,780
Jefferson County, Capital Projects Corp., Lease Revenue, Refunding,
1,640,000 Series A, (original accretion rate 6.75%), 08/15/07 .................... 877,318
4,505,000 Series A, (original accretion rate 6.80%), 08/15/08 .................... 2,251,464
4,580,000 Series A, (original accretion rate 6.87%), 08/15/09 .................... 2,150,722
4,620,000 Series A, (original accretion rate 6.85%), 08/15/10 .................... 2,038,991
6,825,000 Series A, (original accretion rate 6.95%), 08/15/13 .................... 2,447,786
6,860,000 Series A, (original accretion rate 6.95%), 08/15/14 .................... 2,301,393
7,005,000 Series A, (original accretion rate 7.00%), 08/15/16 .................... 2,050,223
7,115,000 Series A, (original accretion rate 7.00%), 08/15/17 .................... 1,962,886
Metropolitan Pier and Exposition Authority Dedicated State Tax Revenue,
5,650,000 Expansion, Project A, FGIC Insured, (original accretion rate 1.97%),
06/15/07 .............................................................. 5,455,414
8,500,000 Expansion, Project A, FGIC Insured, (original accretion rate 6.526%), 06/15/08 4,270,910
11,000,000 Expansion, Project A, FGIC Insured, (original accretion rate 6.677%), 06/15/09 5,185,290
8,000,000 Expansion, Project A, FGIC Insured, (original accretion rate 6.628%), 06/15/10 3,543,200
cZero Coupon Bonds (cont.)
$ 9,690,000 Expansion, Project A, FGIC Insured, (original accretion rate 6.629%), 06/15/11 $ 3,997,997
11,800,000 Expansion, Project A, FGIC Insured, (original accretion rate 3.193%), 06/15/12 8,247,256
5,250,000 Owensboro Electric Light and Power Revenue, Series B, AMBAC Insured,
(original accretion rate 6.85%), 01/01/08 ................................ 2,704,275
Shreveport Water and Sewer Revenue,
490,000 Series B, FGIC Insured, (original accretion rate 7.05%), 12/01/07 ...... 246,308
2,530,000 Series B, FGIC Insured, (original accretion rate 7.05%), 12/01/08 ...... 1,179,284
4,080,000 Series B, FGIC Insured, (original accretion rate 7.05%), 12/01/09 ...... 1,732,205
5,630,000 Series B, FGIC Insured, (original accretion rate 7.05%), 12/01/10 ...... 2,222,611
7,000,000 Spring ISD, Refunding, FGIC Insured, Pre-Refunded, (original accretion rate
7.80%), 08/15/08 ......................................................... 3,113,740
14,250,000 University of Illinois, University Revenues, AMBAC Insured, (original accretion
rate 7.187%), 04/01/10 ................................................... 6,233,805
11,000,000 Washington State Public Power Supply System Revenue, Nuclear Project
No. 2, Refunding, Series A, (original accretion rate 7.33%), 07/01/13 .... 3,690,720
Washington State Public Power Supply System Revenue, Nuclear Project
No. 3, Refunding,
6,400,000 Series 1990-B, (original accretion rate 6.751%), 07/01/12 .............. 2,302,848
15,000,000 Series 1990-B, (original accretion rate 7.25%), 07/01/14 ............... 4,688,400
-------------
Total Zero Coupon Bonds (Cost $88,646,205) .......................... 102,118,040
-------------
Total Long Term Investments (Cost $6,582,470,230) ................... 6,995,360,610
-------------
Short Term Investments .3%
795,000 Bloomington Port Authority, Minnesota Tax Increment Revenue, Stadium Site
Redevelopment Project, Pre-Refunded, 8.25%, 02/01/96 ..................... 803,427
445,000 Brazos River Water Authority, Johnson County, Surface Water and Treatment
Revenue, 8.60%, 09/01/96 ................................................. 458,070
7,400,000 b California Statewide Communities Development Authority Revenue, COP,
Sutter Health Obligation Group, Daily VRDN and Put, AMBAC Insured, 3.80%,
07/01/15 ................................................................. 7,400,000
485,000 Dakota County Housing, Minnesota RDA, Limited Annual Appropriation Tax and
Revenue, Development Housing Facilities Project, 7.00%, 01/01/96 ......... 485,631
2,000,000 b Irvine 1915 Act, Assessment District No. 94-15, Refunding, Daily VRDN and
Put, 4.00%, 09/02/20 ..................................................... 2,000,000
b Irvine Ranch, Water District Revenue,
3,000,000 Daily VRDN and Put, 4.00%, 10/01/10 .................................... 3,000,000
2,700,000 Daily VRDN and Put, 3.85%, 08/01/16 .................................... 2,700,000
$ 4,000,000 b North Carolina Medical Care Community Hospital Revenue, Pooled Financing
Project, Series A, Daily VRDN and Put, 3.95%, 10/01/20 ................... $ 4,000,000
5,000,000 b Orange County, Office and Courthouse Projects, Crossover Refunding, Daily
VRDN and Put, 4.00%, 12/01/15 ............................................ 5,000,000
385,000 St. Paul Port Authority, IDR, Brown and Bigelow Co., Series 1979-2, 7.50%,
10/01/96 ................................................................. 383,464
-------------
Total Short Term Investments (Cost $25,674,181) ..................... 26,230,592
-------------
Total Investments (Cost $6,608,144,411) 98.8% .................. 7,021,591,202
Other Assets and Liabilities, Net 1.2% ......................... 83,310,227
-------------
Net Assets 100.0% .............................................. $7,104,901,429
=============
At October 31, 1995, the net unrealized appreciation based on
the cost of investments for income tax purposes of
$6,608,144,411 was as follows: Aggregate gross unrealized
appreciation for all investments in which there
was an excess of value over tax cost ...................................... $ 439,965,921
Aggregate gross unrealized depreciation for all investments in which there
was an excess of tax cost over value ................................... (26,519,130)
-------------
Net unrealized appreciation ............................................. $ 413,446,791
=============
</TABLE>
aSee Note 1(f) regarding securities purchased on a when-issued basis.
bVariable rate demand notes (VRDN's) are tax-exempt obligations which contain a
floating or variable interest rate adjustment formula and an unconditional right
of demand to receive payment of the principal balance plus accrued interest upon
short notice prior to specified dates. The interest rate may change on specified
dates in relationship with changes in a designated rate (such as the prime
interest rate or U.S. Treasury bills rate).
cZero coupon bonds. The current effective yield may vary. The original accretion
rate will remain constant.
PORTFOLIO ABBREVIATIONS:
1915 Act - Improvement Bond Act of 1915
AMBAC - American Municipal Bond Assurance Corp.
BIG - Bond Investors Guaranty Insurance Co.
BMTF - Bi-Modal Multi-Term Format
CDA - Community Development Authority/Agency
CGIC - Capital Guaranty Insurance Co.
CHM - Collateralized Home Mortgage
COP - Certificate of Participation
EDA - Economic Development Authority/Agency
EDC - Economic Development Corp.
EDR - Economic Development Revenue
ETM - Escrow to Maturity
FGIC - Financial Guaranty Insurance Corp.
FHA - Federal Housing Authority
FI/GML - Federally Insured or Guaranteed Mortgage Loan
FSA - Financial Security Assistance
GNMA - Government National Mortgage Association
GO - General Obligation
HDA - Housing Development Authority
HDC - Housing Development Corp.
HFA - Housing Finance Agency
HFAR - Housing Finance Agency Revenue
HFC - Housing Finance Corp.
HMR - Home Mortgage Revenue
IDA - Industrial Development Authority/Agency
IDAR - Industrial Development Authority Revenue
IDB - Industrial Development Board
IDR - Industrial Development Revenue
IPC - Industrial Pollution Control
MBIA - Municipal Bond Investors Assurance Corp.
MBS - Mortgage Backed Securities
MF - Multi-Family
MFHR - Multi-Family Housing Revenue
MFMR - Multi-Family Mortgage Revenue
MFR - Multi-Family Revenue
MUD - Municipal Utility District
PCR - Pollution Control Revenue
PUD - Public Utility District
RDA - Redevelopment Authority/Agency
RDAR - Redevelopment Agency Revenue
RMR - Residential Mortgage Revenue
SF - Single Family
SFM - Single Family Mortgage
SFMR - Single Family Mortgage Revenue
SFR - Single Family Revenue
USD - Unified School District
The accompanying notes are an integral part of these financial statements.
FRANKLIN FEDERAL TAX-FREE INCOME FUND
Financial Statements
Statement of Assets and Liabilities
October 31, 1995 (unaudited)
Statement of Operations
for the six months ended October 31, 1995 (unaudited)
Assets:
Investments in securities, at value
(identified cost $6,608,144,411) $7,021,591,202
Cash 68,147
Receivables:
Interest 143,535,282
Investment securities sold 22,543,104
Capital shares sold 6,444,895
--------------
Total assets 7,194,182,630
--------------
Liabilities:
Payables:
Investment securities purchased 79,892,907
Capital shares repurchased 4,212,803
Management fees 2,685,454
Distribution fees 1,687,493
Shareholder servicing costs 78,421
Accrued expenses and other liabilities 724,123
--------------
Total liabilities 89,281,201
--------------
Net assets, at value $7,104,901,429
==============
Net assets consist of:
Undistributed net investment income $ 2,938,152
Unrealized appreciation on investments 413,446,791
Accumulated net realized loss (82,009,743)
Class I capital shares 6,756,631,706
Class II capital shares 13,894,523
--------------
Net assets, at value $7,104,901,429
==============
Class I
Net asset value* per share
($7,090,847,851 / 590,329,114
shares outstanding) $12.01
==============
Class II
Net asset value* per share
($14,053,578 / 1,170,156
shares outstanding) $12.01
==============
Statement of Operations
for the six month ended October 31, 1995 (unaudited)
Investment income:
Interest (Note 1) $241,418,367
Expenses:
Management fees (Note 5) $15,928,166
Distribution fees - Class I
(Note 5) 2,359,934
Distribution fees - Class II
(Note 5) 22,141
Shareholder servicing
costs (Note 5) 551,144
Reports to shareholders 809,709
Custodian fees 287,952
Registration fees 226,367
Directors' fees and
expenses 70,617
Professional fees 44,651
Other 143,184
--------------
Total expenses 20,443,865
--------------
Net investment
income 220,974,502
--------------
Realized and unrealized gain
on investments:
Net realized gain 55,115,759
Net unrealized appreciation 110,290,800
--------------
Net realized and unrealized
gain on investments 165,406,559
--------------
Net increase in net assets
resulting from operations $386,381,061
==============
*Redemption price per share is equal to net asset value less any applicable
contingent deferred sales charge.
The accompanying notes are an integral part of these financial statements.
FRANKLIN FEDERAL TAX-FREE INCOME FUND Financial Statements (cont.)
<TABLE>
<CAPTION>
Statements of Changes in Net Assets for the six months ended October 31, 1995
(unaudited) and for the year ended April 30, 1995
Six months Year
ended ended
October 31, 1995 April 30, 1995
Increase (decrease) in net assets:
Operations:
<S> <C> <C>
Net investment income..................................................... $ 220,974,502 $ 438,214,189
Net realized gain (loss) from security transactions....................... 55,115,759 (52,320,273)
Net unrealized appreciation on investments................................ 110,290,800 20,943,713
-------------- -------------
Net increase in net assets resulting from operations.................. 386,381,061 406,837,629
Distributions to shareholders from
undistributed net investment income:
Class I.................................................................. (218,844,762) (452,534,171)
Class II................................................................. (165,996) --
Increase in net assets from capital share transactions (Note 2)............ 50,590,380 128,375,448
-------------- -------------
Net increase in net assets............................................ 217,960,683 82,678,906
Net assets:
Beginning of period........................................................ 6,886,940,746 6,804,261,840
-------------- -------------
End of period (including undistributed net investment income of
$2,938,152 at 10/31/95 and $974,408 at 4/30/95)............................. $7,104,901,429 $6,886,940,746
============== =============
</TABLE>
The accompanying notes are an integral part of these financial statements.
FRANKLIN FEDERAL TAX-FREE INCOME FUND
Notes to Financial Statements (unaudited)
1. SIGNIFICANT ACCOUNTING POLICIES
Franklin Federal Tax-Free Income Fund (the Fund) is an open-end, diversified
management investment company (mutual fund) registered under the Investment
Company Act of 1940 as amended.
The Fund offers two classes of shares, Class I and Class II. Class I shares are
sold with a higher front-end sales charge than Class II. Each class of shares
may be subject to a contingent deferred sales charge and has the same rights,
except with respect to the effect of the respective sales charges, the
distribution fees borne by each class, voting rights on matters affecting a
single class and the exchange privilege of each class.
The offering of Class II shares began on May 1, 1995, at which time all
previously outstanding shares became Class I shares. Realized and unrealized
gains or losses and net investment income, other than class specific expenses,
are allocated daily to each class of shares based upon the relative proportion
of net assets of each class.
The following is a summary of significant accounting policies consistently
followed by the Fund in the preparation of its financial statements. The
policies are in conformity with generally accepted accounting principles for
investment companies.
a. Security Valuation:
Tax-free bonds generally trade in the over-the-counter market rather than on a
national securities exchange. Often there are no transactions in a particular
security on any given day. In the absence of a recorded sale or reported bid and
asked prices, information with respect to bond and note transactions, quotations
from bond dealers, market transactions in comparable securities, and various
relationships between securities are used to determine the value of the
security. The Fund may utilize a pricing service, bank or broker/dealer
experienced in such matters to perform any of the pricing functions, under
procedures approved by the Board of Directors. Other securities for which market
quotations are not available, if any, are valued in accordance with procedures
established by the Board of Directors.
b. Municipal Bonds or Notes with "Puts":
The Fund has purchased municipal bonds or notes with the right to resell the
bonds or notes to the seller at an agreed upon price or yield on a specified
date or within a specified period (which will be prior to the maturity date of
the bonds or notes). Such a right to resell is commonly known as a "put." In
determining the weighted average maturity of the Fund's portfolio, municipal
bonds and notes as to which the Fund holds a put are deemed to mature on the
first day on which the put may be exercisable.
c. Income Taxes:
The Fund intends to continue to qualify for the tax treatment applicable to
regulated investment companies under the Internal Revenue Code and to make the
requisite distributions to its shareholders which will be sufficient to relieve
it from income and excise taxes. Therefore, no income tax provision is required.
d. Security Transactions:
Security transactions are accounted for on the date the securities are purchased
or sold (trade date). Realized gains and losses on security transactions are
determined on the basis of specific identification for both financial statement
and income tax purposes.
e. Investment Income, Expenses and Distributions:
Distributions to shareholders are recorded on the ex-dividend date. Interest
income and estimated expenses are accrued daily. Bond discount and premium, if
any, are amortized as required by the Internal Revenue Code.
1. SIGNIFICANT ACCOUNTING POLICIES (cont.)
f. Securities Purchased on a When-Issued or Delayed Delivery Basis:
The Fund may trade securities on a when-issued or delayed delivery basis, with
payment and delivery scheduled for a future date. These transactions are subject
to market fluctuations and are subject to the risk that the value at delivery
may be more or less than the trade date purchase price. Although the Fund will
generally purchase these securities with the intention of acquiring such
securities, it may sell such securities before the settlement date. These
securities are identified on the accompanying Statement of Investments in
Securities and Net Assets. The Fund has set aside sufficient investment
securities as collateral for these purchase commitments.
2. CAPITAL STOCK
At October 31, 1995, there were 10,000,000,000 shares of capital stock
authorized for the Fund, with 3,000,000,000 shares of no par value capital stock
currently allocated to each class of shares, and a remaining balance to be
allocated at a later date if needed. Paid in capital aggregated $6,756,631,706
and $13,894,523 for Class I and Class II, respectively.
Transactions in the Fund's Class I and Class II shares were as follows:
<TABLE>
<CAPTION>
Six Months Ended Year Ended
October 31, 1995 April 30, 1995
-------------- -------------
Class I Shares: Shares Amount Shares Amount
----------- -------- -------- ---------
<S> <C> <C> <C> <C>
Shares sold.................................... 21,813,204 $258,891,456 54,334,131 $ 630,492,584
Shares issued in reinvestment of distributions. 7,003,649 82,734,923 14,353,408 165,824,077
Shares redeemed................................ (25,064,118) (297,454,138) (56,590,781) (652,304,375)
Changes from exercise of exchange privilege:
Shares sold................................... 16,475,038 195,397,843 42,618,679 491,052,692
Shares redeemed............................... (17,097,038) (202,874,127) (43,858,952) (506,689,530)
------------ ------------- ------------- -------------
Net increase................................... 3,130,735 $ 36,695,957 10,856,485 $ 128,375,448
============ ============= ============= ============
Six Months Ended
October 31, 1995
----------------------------
Class II Shares: Shares Amount
-------------- -------------
Shares sold.................................... 1,169,520 $13,887,501
Shares issued in reinvestment of distributions. 8,214 97,335
Shares redeemed................................ (9,138) (108,903)
Changes from exercise of exchange privilege:
Shares sold................................... 1,560 18,590
-------------- --------------
Net increase................................... 1,170,156 $13,894,523
============== ==============
</TABLE>
3. DISTRIBUTIONS AND CAPITAL LOSS CARRYOVERS
At April 30, 1995, for tax purposes, the Fund had capital loss carryovers
expiring as follows:
1996...............................$ 32,151,648
1997............................... 19,946,075
1998............................... 14,050,263
2000............................... 8,032,018
2002............................... 10,591,976
2003............................... 52,353,522
------------
$137,125,502
============
For income tax purposes, the aggregate cost of securities and unrealized
appreciation are the same as for financial reporting purposes at October 31,
1995.
4. PURCHASES AND SALES OF SECURITIES
Purchases and sales of securities (excluding purchases and sales of short-term
securities) for the six months ended October 31, 1995 aggregated $722,760,527
and $674,011,474, respectively.
5. TRANSACTIONS WITH AFFILIATES AND RELATED PARTIES
Franklin Advisers, Inc., ("Advisers") under the terms of a management agreement,
provides investment advice, administrative services, office space and facilities
to the Fund, and receives fees computed monthly on the net assets of the Fund on
the last day of the month at an annualized rate of 5/8 of 1% of the first $100
million of net assets, 1/2 of 1% of net assets in excess of $100 million up to
and including $250 million, 45/100 of 1% of net assets in excess of $250 million
up to and including $10 billion, 44/100 of 1% of net assets in excess of $10
billion up to and including $12.5 billion, 42/100 of 1% of net assets in excess
of $12.5 billion up to and including $15 billion, 40/100 of 1% of net assets in
excess of $15 billion up to and including $17.5 billion, 38/100 of 1% of net
assets in excess of $17.5 billion up to and including $20 billion, and 36/100 of
1% of net assets in excess of $20 billion. Fees incurred by the Fund aggregated
$15,928,166 for the six months ended October 31, 1995. The terms of the
management agreement provide that aggregate annual expenses of the Fund be
limited to the extent necessary to comply with the limitations set forth in the
laws, regulations and administrative interpretations of the states in which the
Fund's shares are registered. For the six months ended October 31, 1995, the
Fund's expenses did not exceed these limitations.
Under the terms of Distribution Plans pursuant to Rule 12b-1 of the Investment
Company Act of 1940, which was effective May 1, 1994 for Class I shares, and May
1, 1995 for Class II shares, Class I and II shares will reimburse
Franklin/Templeton Distributors, Inc., ("Distributors") in an amount up to a
maximum of 0.10% per annum for Class I and 0.65% per annum for Class II of the
average daily net assets of such class, for costs incurred in the promotion,
offering and marketing of the Class I and Class II shares. Fees incurred under
the agreement aggregated $2,382,075 for the six months ended October 31, 1995.
In its capacity as underwriter for the capital stock of the Fund, Distributors
received commissions on sales of the Fund's capital stock. Commissions are
deducted from the gross proceeds received from the sale of the capital stock of
the Fund and as such are not expenses of the Fund. Distributors may also make
payments, out of its own resources, to dealers for certain sales of Class I and
Class II shares.
5. TRANSACTIONS WITH AFFILIATES AND RELATED PARTIES (cont.)
Commissions received by Distributors and the amounts paid to other dealers for
the six months ended October 31, 1995 were as follows:
<TABLE>
<CAPTION>
Class I Class II
---------- --------
<S> <C> <C>
Total commissions received............................................................. $8,212,842 $140,281
========== =========
Paid to other dealers.................................................................. $7,725,091 $191,811
========== =========
</TABLE>
Distributors also received contingent deferred sales charges relating to
transactions in the Fund in the amounts of $944 and $1,109, for Class I and
Class II, respectively.
Pursuant to a shareholder servicing agreement with Franklin/Templeton Investor
Services, Inc. ("Investor Services"), the Fund pays costs on a per shareholder
account basis. Such costs incurred for the six months ended October 31, 1995
aggregated $551,144, all of which was paid to Investor Services.
Certain officers and directors of the Fund are also officers and/or directors of
Franklin/Templeton Distributors, Inc., Franklin Advisers, Inc. and
Franklin/Templeton investors Services, Inc., all wholly-owned subsidiaries of
Franklin Resources, Inc.
6. CREDIT RISK
Although the Fund has a diversified portfolio, it has investments in excess of
10% of its total net assets in the state of New York. Such concentration may
subject the Fund more significantly to economic changes occurring within that
state.
The Fund has 3.83% of its portfolio invested in lower rated and comparable
quality unrated high yield securities. Investments in higher yield securities
are accompanied by a greater degree of credit risk and such lower quality
securities tend to be more sensitive to economic conditions than higher rated
securities.
7. FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
Selected data for a share of capital stock outstanding throughout the period:
Six Months Ended Year ended April 30,
Class I Shares: October 31, 1995 1995 1994 1993 1992 1991
Per Share Operating Performance
<S> <C> <C> <C> <C> <C> <C>
Net asset value at beginning of year $11.73 $11.81 $12.24 $11.68 $11.40 $11.08
--------- --------- --------- -------- -------- --------
Net investment income............... .38 .75 .77 .80 .82 .83
Net realized and unrealized gain
(loss) on securities............... .272 (.053) (.415) .576 .302 .342
--------- --------- --------- -------- -------- --------
Total from investment operations.... .652 .697 .355 1.376 1.122 1.172
Distributions from net
investment income.................. (.372) (.777) (.785) (.816) (.842) (.852)
--------- --------- --------- -------- -------- --------
Net asset value at end of year...... $12.01 $11.73 $11.81 $12.24 $11.68 $11.40
========= ========= ========= ======== ======== ========
Total Return*....................... 5.65% 6.21% 2.58% 11.89% 9.90% 10.67%
Ratios/Supplemental Data
Net assets at end of year (in 000's) $7,090,848 $6,886,941 $6,804,262 $6,414,739 $5,184,214 $4,353,043
Ratio of expenses to average
net assets......................... .58%** .59% .52% .51% .51% .50%
Ratio of net investment income to
average net assets................. 6.31%** 6.47% 6.27% 6.68% 7.07% 7.34%
Portfolio turnover rate............. 7.95% 19.88% 24.59% 13.30% 14.94% 28.79%
</TABLE>
Six Months Ended
Class II Shares: October 31, 1995
Per Share Operating Performance
Net asset value at beginning of year $11.73
--------
Net investment income............... .37
Net realized and unrealized gain
on securities...................... .252
---------
Total from investment operations.... .622
Distributions from net
investment income.................. (.342)
---------
Net asset value at end of year...... $12.01
=========
Total Return*....................... 5.39%
Ratios/Supplemental Data
Net assets at end of year (in 000's) $14,054
Ratio of expenses to average
net assets......................... 1.16%**
Ratio of net investment income to
average net assets................. 5.71%**
Portfolio turnover rate............. 7.95%
*Total return measures the changes in value of an investment over the periods
indicated. It is not annualized. It does not include the maximum front-end sales
charge or the deferred contingent sales charge. Prior to May 1, 1994, the total
return for Class I shares also assumes reinvestment of dividends at offering
price and capital gains, if any, at net asset value. Effective May 1,1994, with
the implementation of the Rule 12b-1 distribution plan for Class I shares, as
disclosed in Note 5, the sales charge on reinvested dividends was eliminated.
**Annualized.
ranklin Federal Tax-Free Income Fund
APPENDIX
DESCRIPTION OF GRAPHIC MATERIAL OMITTED FROM EDGAR FILING
(PERSUANT TO ITEM 304 (a) OF REGULATION S-T)
GRAPHIC MATERIAL (1)
This chart shows in pie chart format the fund's securities quality breakdown, as
a percentage of the fund's total net assets.
<TABLE>
<CAPTION>
Quality Breakdown on 10/31/95
<S> <C>
AAA 32.5%
AA 15.2%
A 20.7%
BBB 27.8%
Below Investment Grade 3.8%
</TABLE>
GRAPHIC MATERIAL (2)
This bar chart shows the comparison between the fund's distribution rate of
5.93% and the taxable equivalent distribution rate of 9.82%, for the Class I
shares.
GRAPHIC MATERIALS (3)
This bar chart shows the comparison between the fund's distribution rate of
5.54% and the taxable equivalent distribution rate of 9.17%, for the Class II
shares.
