GIT Tax-Free Trust
Arizona Portfolio
Maryland Portfolio
Missouri Portfolio
Virginia Portfolio
National Portfolio
Money Market Portfolio
Semi-Annual Report
March 31, 1996/Unaudited
GIT
GIT Investment Funds
<PAGE>
Letter to Shareholders
May 23, 1996
Dear Shareholder:
The six-months covered by this report began with interest
rate declines and ended with rates headed upward. By
December 1995, the yield of the 30 year treasury bond fell
below 6%, and then rose to 6.63% on April 1, 1996.
The Federal Reserve Board has since left rates unchanged,
and during the March 26, 1996 Federal Open Market Committee
meeting, Chairman Greenspan assured the bond markets that
the economy is "moving forward with inflation in check."
In this more stable environment, the performance of
municipals relative to other bonds will depend on the
perceived likelihood of tax reform, and on the financial
condition of state and local municipalities -- matters which
do not appear to be of great concern at this time. New
issuance of municipal bonds was its lowest in five years for
1995, and this more limited supply should support bond
prices in 1996.
We maintain a conservative stance in each of the GIT Tax-
Free Trust portfolios, holding general obligation and
revenue bonds weighted according to the fundamentals of each
sector. In the near term, we expect to maintain average
maturities in the 15 to 20 year range, where we now see the
best value.
National Portfolio
Economic results show the plains and mountain states
outpacing the rest of the country, and the South Central
states and Texas continuing their above average growth.
Growth in the Northeast has been trailing the rest of the
nation, leaving this region the most exposed to recession if
the national economy declines.
The National Portfolio's holdings are diversified throughout
the country, with an average credit rating of AA . Total
return for the year ending March 31, 1996 was 6.73%.
Arizona Portfolio
Arizona's work force continued to grow faster than available
jobs in 1995 but there are signs that the trend is
reversing. Service industry employers have been expanding
,and two major construction projects, a $1.5 billion Intel
Corp. factory and $250 million stadium in the Phoenix area,
have been soaking up skilled workers. Expansion by several
national retail chains, including Circuit City and Best
Buys, has caused labor shortages and driven retail wages up
by more than 10%.
Arizona has no general obligation debt and credit trends are
generally stable among the municipal issuers. The Arizona
portfolio has an average credit rating of AA, and posted a
total return of 6.70% for the year ended March 31, 1996.
Missouri Portfolio
Missouri has a broad based and diversified economy. Although
the state has been losing federal jobs, job growth
accelerated during the last quarter of 1995, helped by the
re-opening of a General Motors plant near St. Louis and a
jump in jobs in the business services sector.
Missouri has long record of responsible financial operations
as indicated by the AAA Rating of its general obligation
debt. The Missouri Portfolio has an average credit rating of
AA and a total return for the year ended March 31, 1996 of
6.56%
Maryland Portfolio
Maryland's economic base is both diverse and balanced, with
a lower than average dependence on manufacturing. Federal
government shutdowns in November and December thwarted
employment growth, which was also hurt by cutbacks in
manufacturing and retailing. Municipal credit trends are
stable, and the general obligation debt of the state is
rated AAA. The average credit rating of the portfolio is AA
and its total return for the year ended March 31, 1996 was
5.88%.
Virginia Portfolio
Although the federal government shutdowns in November and
December hurt employment numbers in Virginia, the state's
economic growth is expected to exceed that of the nation as
a whole in the near term. The state's general obligation
bonds have maintained a AAA credit rating and the credit
trend is considered stable. The average credit rating for
the Virginia portfolio is AA. The total return of the fund
for the year ended March 31, 1996 was 7.05%
Money Market Portfolio
This portfolio continues to provide a high degree of
liquidity and share price stability. As of March 31, 1996,
the fund's seven day yield was 2.37%, the equivalent of
3.70% from a taxable bond for an investor in the highest
federal tax bracket.
We appreciate your confidence in GIT Investment Funds, and
hope you will look closely at all thirteen of our no-load
mutual fund portfolios.
Sincerely,
(signature)
A. Bruce Cleveland
President
<PAGE>
Arizona Portfolio
Portfolio of Investments - March 31, 1996
(Unaudited)
Credit Rating* Principal
Moody's S&P Amount Value
LONG-TERM MUNICIPAL BONDS:
97.7% of Net Assets
AIRPORT: 5.4%
Aaa AAA Tucson Airport Authority,
Airport Revenue
(MBIA Insured), 5.7%, 6/1/13 $500,000 $502,500
EDUCATION: 4.6%
A nr Arizona Educational Loan
Marketing Corporation,
Student Loan Revenue (AMT),
7%, 3/1/03 400,000 427,000
ELECTRIC: 7.5%
Baa1 A- Puerto Rico Electric Power
Authority, Electric Power
Revenue, 6.375%, 7/1/24 190,000 194,988
Aa AA Salt River Project Agricultural
Improvements and Power District,
Electric Systems Revenue,
6%, 1/1/16 500,000 505,625
GENERAL OBLIGATION: 32.7%
Aaa AAA Chandler (FGIC Insured), 7%,
7/1/12 300,000 330,375
Aaa AAA Maricopa County School District
(FGIC Insured), 6.25%, 7/1/11 500,000 539,375
Aaa AAA Maricopa County School District
(FGIC Insured), 6.7%, 7/1/11 300,000 328,125
Aaa AAA Navajo County School District,
(FSA Insured), 6%, 7/1/09 500,000 515,000
#Aaa AA+ Phoenix, 6%, 7/1/13 500,000 529,375
Aa1 AA+ Phoenix, 5.3%, 7/1/06 100,000 102,500
#Aaa AA+ Scottsdale, 6.9%, 7/1/07 100,000 111,000
Aa1 AA+ Scottsdale, 5.5%, 7/1/09 200,000 204,500
A1 AA- Tucson, 5.6%, 7/1/16 400,000 392,500
HOSPITAL: 5.1%
Aaa AAA Arizona Health Facilities
Authority, Hospital Revenue
(Samaritan Health Services)
(MBIA Insured), 6.25%,
12/1/06 250,000 265,625
Aaa AAA Arizona Health Facilities
Authority, Hospital Revenue
(Phoenix Baptist Hospital)
(MBIA Insured), 6.25%, 9/1/11 200,000 210,250
HOUSING: 10.9%
nr AAA Phoenix Industrial Development
Authority, Mortgage Revenue
(Chris Ridge) (FHA), 6.75%,
11/1/12 500,000 515,000
nr AAA Pima County Industrial
Development Authority,
Single-Family Mortgage Revenue
(GNMA Collateralized) (AMT),
6.2%, 5/1/27 500,000 499,375
INDUSTRIAL DEVELOPMENT: 3.5%
nr A-1+ Mohave County Industrial Development
Authority, Industrial Development
Revenue (Citizens Utilities), 7.05,
8/1/20 300,000 324,750
LEASING: 3.3%
Aaa AAA Scottsdale Municipal Property
Corporation, Lease Revenue (FGIC
Insured), 6.25%, 11/1/14 300,000 309,750
TRANSPORTATION: 15.4%
Aa AA Arizona State Transportation Board,
Highway Revenue, 6%, 7/1/08 400,000 433,000
Aaa AAA Flagstaff, Street and Highway User
Revenue (FGIC Insured), 5.9%,
7/1/10 500,000 524,375
Baa1 A Puerto Rico Commonwealth Highway
and Transportation Authority,
Highway Revenue, 6.375%,
7/1/08 450,000 478,687
WATER AND SEWER: 9.3%
Aaa AAA Arizona State Wastewater Management
Authority, Revenue (AMBAC Insured),
5.95%, 7/1/12 200,000 204,000
Aaa AAA Chandler, Water and Sewer Revenue
(FGIC Insured), 6.75%, 7/1/06 250,000 271,563
A1 A+ Tucson, Water Revenue (AMBAC Insured),
5.75%, 7/1/18 400,000 398,000
TOTAL INVESTMENTS (Cost $8,729,341)+ $9,117,238
See Notes to Portfolios of Investments.
<PAGE>
Maryland Portfolio
Portfolio of Investments - March 31, 1996
(Unaudited)
Credit Rating* Principal
Moody's S&P Amount Value
LONG-TERM MUNICIPAL BONDS:
94.0% of Net Assets
EDUCATION: 9.3%
Aa1 AA- Maryland State Health and Higher
Educational Facilities Authority,
University Revenue (Johns Hopkins
University), 7.5%, 7/1/20 $100,000 $107,750
Aaa AAA Saint Mary's College, College
Revenue (MBIA Insured), 5.55%,
9/1/23 100,000 99,625
Aa AA+ University of Maryland, Auxiliary
Facilities and Tuition Revenue,
5.5%, 4/1/13 50,000 49,187
ELECTRIC: 3.7%
Baa1 A- Puerto Rico Electric Power Authority,
Power Revenue, 6%, 7/1/14 100,000 100,625
GENERAL OBLIGATION: 22.3%
Aa AA+ Anne Arundel County (AMT), 5.5%,
9/1/16 100,000 97,375
Aaa AAA Baltimore (AMBAC Insured), 6%,
10/15/04 100,000 108,125
#Aaa AAA Harford County, 5.75%, 9/1/08 25,000 26,813
Aa AA- Harford County, 5.75%, 9/1/08 25,000 25,875
Aaa AA+ Howard County, 6%, 5/15/13 150,000 154,125
Aaa AAA Maryland State, 4.6%, 2/15/09 100,000 93,875
Aaa AAA Ocean City (MBIA Insured), 6.3%,
11/1/09 50,000 54,938
Aa1 AA Washington Suburban Sanitary District,
5.875%, 6/1/08 50,000 52,312
HOSPITAL: 7.1%
A1 A Maryland State Health and Higher
Educational Facilities Authority,
Hospital Revenue (Good Samaritan
Hospital), 5.75%, 7/1/19 100,000 97,750
Baa nr Prince George's County Hospital,
Hospital Revenue (Greater
Southeast Healthcare System),
6.2%, 1/1/08 100,000 98,000
HOUSING: 11.3%
nr AAA Anne Arundel County, Mortgage
Revenue (Westwinds Apartments)
(FHA), 6%, 12/1/26 50,000 50,063
nr AA Baltimore County, Mortgage Revenue
(Olde Forge Townhouses) (FHA),
6%, 1/1/10 80,000 79,700
Aa nr Maryland State Community Development
Administration, Multifamily
Housing Revenue (GNMA Collateralized)
(FHA), 5.95%, 5/15/13 80,000 79,800
Aa nr Maryland State Community Development
Administration, Single-Family
Housing Revenue (AMT), 6.2%,
4/1/17 100,000 100,500
LEASING: 5.0%
Aa AA- Maryland State Stadium Authority,
Sports Facilities Lease Revenue
(AMT), 7.5%, 12/15/10 125,000 138,281
POLLUTION CONTROL: 8.5%
A2 A Anne Arundel County, Pollution
Control Revenue (Baltimore Gas
and Electric Company), 6%,
4/1/24 100,000 101,000
A1 A Prince George's County, Pollution
Control Revenue (Potomac Electric),
6.375%, 1/15/23 125,000 131,094
PUBLIC FACILITIES: 9.4%
Aaa AAA Baltimore, Convention Center Revenue
(FGIC Insured), 6.1%, 9/1/14 150,000 153,937
Aa AA- Howard County, Special Facilities
Revenue, 5.95%, 2/15/10 100,000 104,375
TRANSPORTATION: 8.0%
Aa3 AA- Baltimore, Port Facilities Revenue
(Consolidated Coal Sales), 6.5%,
10/1/11 100,000 107,500
#Aaa AAA Maryland State Transportation
Authority, Transportation Revenue,
6.8%, 7/1/16 100,000 111,250
See Notes to Portfolios of Investments.
<PAGE>
Maryland Portfolio
Portfolio of Investments - March 31, 1996 (continued)
Credit Rating* Principal
Moody's S&P Amount Value
UTILITY: 2.0%
A A+ Puerto Rico Telephone Authority,
Telecommunications Revenue,
5.5%, 1/1/22 $60,000 $55,800
WASTE: 3.7%
A nr Northeast Waste Disposal Authority,
Waste Revenue (Montgomery County),
6.3%, 7/1/16 100,000 100,625
WATER: 3.7%
Aaa AAA Baltimore, Water Revenue (MBIA
Insured), 5.5%, 7/1/08 100,000 102,750
TOTAL INVESTMENTS (Cost $2,551,551)+ $2,583,050
Missouri Portfolio
Portfolio of Investments - March 31, 1996
(Unaudited)
Credit Rating* Principal
Moody's S&P Amount Value
LONG-TERM MUNICIPAL BONDS:
97.0% of Net Assets
AIRPORT: 4.6%
Aaa AAA St. Louis, Airport Revenue,
Lambert-St. Louis
International (FGIC Insured)
(AMT), 6.125%, 7/1/12 $500,000 $515,000
EDUCATION: 5.7%
A nr Missouri Higher Education Loan
Authority, Student Loan Revenue
(AMT), 5.9%, 2/15/08 500,000 485,625
Aaa AAA Missouri State Health and
Educational Facilities Authority,
University Revenue (St. Louis
University) (AMBAC Insured),
6.5%, 8/1/16 150,000 160,875
ELECTRIC: 9.3%
nr AAA Puerto Rico Electric Power Authority,
Power Revenue, 8%, 7/1/08 175,000 192,937
Aaa AAA Sikeston, Electric Revenue (MBIA
Insured), 5%, 6/1/22 400,000 355,500
nr A University Development Foundation,
Lease Revenue (Missouri Power),
5.75%, 5/1/13 500,000 501,250
GENERAL OBLIGATION: 31.7%
Aa nr Clayton School District, 5.65%,
2/1/14 500,000 496,875
Aaa AAA Farmington School District (FSA
Insured), 6.35%, 3/1/12 400,000 413,500
Aa nr Jefferson City School District,
6.7%, 3/1/11 200,000 226,250
Aaa AAA Missouri State, Correctional
Facilities Improvements, 5.5%,
4/1/20 500,000 486,250
nr AAA Puerto Rico Commonwealth, 7.75%,
7/1/17 250,000 280,312
Aaa AAA St. Charles County, Francis Howell
School District (FGIC Insured),
6.5%, 3/1/05 250,000 272,500
Aa1 nr St. Louis County, 6.3%, 2/1/11 400,000 418,000
Aa nr St. Louis County School District,
5.5%, 2/15/12 500,000 500,000
Aa nr St. Louis County School District,
5.5%, 2/15/13 500,000 497,500
HOSPITAL: 12.9%
Aaa AAA Missouri State Health and
Educational Facilities Authority,
Health Facilities Revenue
(SSM Health Care) (MBIA Insured),
6.25%, 6/1/16 250,000 259,063
Aaa AAA Missouri State Health and Educational
Facilities Authority, Health
Facilities Revenue (Heartland
Health System) (AMBAC Insured),
6.35%, 11/15/17 500,000 522,500
nr nr Missouri State Health and Educational
Facilities Authority, Health
Facilities Revenue (Missouri
Baptist Medical Center),
7.625%, 7/1/18 95,000 106,756
nr nr Missouri State Health and Educational
Facilities Authority, Health
Facilities Revenue (Missouri
Baptist Medical Center), 7.625%,
7/1/18 45,000 56,194
Aaa AAA Missouri State Health and Educational
Facilities Authority, Health
Facilities Revenue (Health Midwest)
(MBIA Insured), 6.25%,
2/15/22 500,000 517,500
See Notes to Portfolios of Investments.
<PAGE>
Missouri Portfolio
Portfolio of Investments - March 31, 1996 (continued)
Credit Rating* Principal
Moody's S&P Amount Value
HOUSING: 6.8%
nr AAA Missouri State Housing
Development Commission,
Single-Family Mortgage Revenue
(GNMA Collateralized) (FHA)
(AMT), 7.75%, 6/1/22 $75,000 $79,219
nr AAA Missouri State Housing Development
Commission, Single-Family
Mortgage Revenue (GNMA
Collateralized) (FHA) (AMT),
7.375%, 8/1/23 190,000 201,875
nr AAA St. Louis County, Mortgage Revenue
(Certificates of Receipt) (AMT),
5.65%, 2/1/20 500,000 493,750
LEASING: 9.6%
#Aaa AAA Kansas City Municipal Assistance
Corporation, Lease Revenue (H.
Roe Bartle) (AMBAC Insured),
6%, 4/15/20 500,000 533,125
Aa AA Missouri State Board of Public
Buildings, Lease Revenue,
6.4%, 12/1/08 300,000 322,125
A1 A+ Missouri State Regional Convention
and Sports Complex Authority,
Lease Revenue, 5.5%, 8/15/13 250,000 237,188
WASTE: 6.1%
Aa nr Missouri State Environmental
Improvement and Energy Resources
Authority, Water Pollution
Control Revenue, 5.4%, 7/1/15 500,000 475,000
A1 AA- St. Louis Industrial Development
Authority, Pollution Control Revenue
(Anheuser Busch Company), 6.65%,
5/1/16 200,000 217,250
WATER: 10.3%
Aaa AAA Cape Girardeau, Waterworks Revenue
(FGIC Insured), 6.4%,
3/1/12 400,000 437,000
A1 AA Columbia, Water and Electric
Revenue, 6.125%, 10/1/12 400,000 416,000
Aaa AAA Liberty, Water Revenue (MBIA
Insured), 6.3%, 10/1/12 300,000 315,375
TOTAL INVESTMENTS (Cost $10,703,072)+ $10,992,294
Virginia Portfolio
Portfolio of Investments - March 31, 1996
(Unaudited)
Credit Rating* Principal
Moody's S&P Amount Value
LONG-TERM MUNICIPAL BONDS:
97.9% of Net Assets
AIRPORT: 4.5%
Aaa AAA Capital Regional Airport Commission,
Airport Revenue (Richmond
International Airport) (AMBAC
Insured), 5.625%, 7/1/15 $500,000 $490,625
Aaa AAA Metropolitan Washington D.C.
Airports Authority, Airport Revenue
(MBIA Insured) (AMT), 6.625%,
10/1/12 500,000 531,250
Aaa AAA Metropolitan Washington D.C.
Airports Authority, Airport
Revenue (FGIC Insured) (AMT),
7%, 10/1/18 500,000 540,625
EDUCATION: 13.2%
A1 nr Loudoun County Industrial Development
Authority, Facilities Revenue
(George Washington University),
6.25%, 5/15/22 500,000 509,375
nr BBB- Virginia College Building Authority,
Facilities Revenue (Marymount
University), 7%, 7/1/22 350,000 369,688
Aa AA Virginia College Building
Authority, Facilities Revenue
(Washington and Lee University),
6.4%, 1/1/12 500,000 526,875
Aa AA Virginia College Building Authority,
Facilities Revenue (Washington
and Lee University), 5.75%,
1/1/14 555,000 552,225
Aa AA Virginia State Public School
Authority, Revenue, 6.25%,
8/1/10 500,000 525,000
Aa AA Virginia State Public School
Authority, Revenue, 6.2%,
8/1/13 500,000 523,750
Aa AA Virginia State Public School
Authority, Revenue, 6.5%,
8/1/15 500,000 533,125
Aa AA Virginia State Public School
Authority, Special Obligation
(York County), 5.9%, 7/15/13 500,000 508,125
A1 AA- Virginia State Universities,
University Revenue (Virginia
Commonwealth University),
5.75%, 5/1/15 500,000 504,375
See Notes to Portfolios of Investments.
<PAGE>
Virginia Portfolio
Portfolio of Investments - March 31, 1996 (continued)
Credit Rating* Principal
Moody's S&P Amount Value
ELECTRICAL: 2.9%
Aaa AAA Hailifax County Industrial
Development Authority, Power
Revenue (Old Dominion Electric)
(MBIA Insured) (AMT), 7%,
10/1/18 $1,000,000 $1,006,250
GENERAL OBLIGATION: 25.3%
Aaa AAA Arlington County, 6%, 8/1/12 1,000,000 1,036,250
Aaa AAA Fairfax County, 5.625%, 6/1/13 500,000 500,625
Aa A+ Falls Church, 5.5%, 8/1/13 500,000 490,625
Aaa AAA Franklin County (FGIC Insured),
6.5%, 7/15/12 300,000 315,750
Aa AA- Hampton, 6%, 1/15/08 500,000 525,625
A A Henry County, 6%, 7/15/14 500,000 513,750
Aaa AAA Leesburg (AMBAC Insured), 5.6%,
6/1/15 500,000 495,625
Aaa AAA Newport News (MBIA Insured),
5.5%, 7/1/10 500,000 506,250
Aaa AAA Norfolk (MBIA Insured), 5.75%,
6/1/13 500,000 500,625
Baa1 A Puerto Rico Commonwealth, 6.3%,
7/1/09 1,000,000 1,052,500
A1 AA Richmond, 5.5%, 1/15/22 200,000 185,250
A1 AA Richmond, 6.25%, 1/15/18 750,000 767,813
Aa AA Virginia Beach, 6.2%, 9/1/13 500,000 525,625
Aa AA Virginia Beach, 5.85%, 11/1/13 350,000 354,375
Aa AA Winchester, 5.5%, 1/15/14 1,000,000 975,000
HOSPITAL: 6.1%
Aaa AAA Danville Industrial Development
Authority, Hospital Revenue
(Danville Regional Medical
Center) (FGIC Insured),
6.375%, 10/1/14 500,000 524,375
Aa AA Norfolk Industrial Development
Authority, Hospital Revenue
(Sentara Hospital),
6.5%, 11/1/13 1,000,000 1,048,750
Aaa AAA Roanoke Industrial Development
Authority, Hospital Revenue
(Roanoke Memorial Hospitals)
(MBIA Insured), 6.125%,
7/1/17 500,000 523,750
HOUSING: 3.0%
Aa1 AA+ Virginia State Housing Development
Authority, Mortgage Revenue
(AMT), 6.95%, 1/1/10 1,000,000 1,045,000
INDUSTRIAL DEVELOPMENT: 5.1%
A2 A Louisa Industrial Development
Authority, Pollution Control
Revenue, 5.45%, 1/1/24 200,000 184,000
Baa3 BBB-Peninsula Ports Authority, Coal
Terminal Revenue, 7.375%,
6/1/20 1,000,000 1,063,750
A1 A Puerto Rico, Industrial Revenue
(Pepsico, Inc.), 6.25%,
11/15/13 500,000 530,000
LEASING AND OTHER FACILITIES: 9.7%
Aa AA Fairfax County Economic Development
Authority, Lease Revenue, 5.5%,
5/15/18 500,000 477,500
nr BBB Fairfax County Park Authority,
Facilities Revenue, 6.625%,
7/15/14 500,000 510,625
nr A- Prince William County Park
Authority, Revenue, 6.875%,
10/15/16 500,000 531,875
A nr Prince William County Park
Authority, Revenue, 7.5%,
7/15/20 450,000 507,375
Aaa AAA Riverside Regional Jail Authority,
Jail Facilities Revenue (MBIA
Insured), 6%, 7/1/25 250,000 252,187
Aa AA Virginia State Public Building
Authority, Building Revenue,
6%, 8/1/08 500,000 530,625
Aa AA Virginia State Public Building
Authority, Building Revenue,
6.25%, 8/1/12 500,000 545,625
TRANSPORTATION: 11.9%
Aaa AAA Chesapeake Bay Bridge and Tunnel
Commission, Highway Revenue
(MBIA Insured), 5.25%, 7/1/19 500,000 463,125
Aaa AAA Richmond Metropolitan Authority,
Expressway Revenue (FGIC
Insured), 6.375%, 7/15/16 1,000,000 1,040,000
Aa AA Virginia State Transportation
Board, Revenue (Route 28),
6%, 4/1/10 1,000,000 1,030,000
Aa AA Virginia State Transportation
Board, Revenue (Route 58),
5.625%, 5/15/13 500,000 495,625
Aaa AAA Washington D.C. Metropolitan
Area Transportation Authority,
Transit Revenue (FGIC Insured),
6%, 7/1/07 1,000,000 1,067,500
See Notes to Portfolios of Investments.
<PAGE>
Virginia Portfolio
Portfolio of Investments - March 31, 1996 (continued)
Credit Rating* Principal
Moody's S&P Amount Value
WASTE: 7.5%
A1 A+ Fairfax County Economic
Development Authority,
Revenue (Ogden Martin Systems)
(AMT), 7.75%, 2/1/11 $500,000 $543,750
A1 AA- Henrico County, Water and Sewer
Revenue, 6.25%, 5/1/13 500,000 513,750
Aaa AAA Loudoun County Sanitation
Authority, Water and Sewer
Revenue (FGIC Insured),
6.25%, 1/1/16 500,000 525,625
nr A+ Roanoke Valley, Solid Waste
System Revenue, 5.75%, 9/1/12 770,000 760,375
Baa3 BBB West Point Industrial Development
Authority, Waste Revenue
(Chesapeake Corporation),
6.25%, 3/1/19 250,000 252,187
WATER: 8.7%
Aa AA- Fairfax County Water Authority,
Water Revenue, 6%, 4/1/22 1,500,000 1,516,875
Aaa AAA Frederick-Winchester Service
Authority, Sewer Revenue
(AMBAC Insured), 5.75%,
10/1/15 1,000,000 1,001,250
Aaa AAA Norfolk, Water Revenue (MBIA
Insured), 5.75%, 11/1/12 500,000 504,375
TOTAL INVESTMENTS (Cost $32,805,737)+ $33,856,850
National Portfolio
Portfolio of Investments - March 31, 1996
(Unaudited)
Credit Rating* Principal
Moody's S&P Amount Value
LONG-TERM MUNICIPAL BONDS:
97.9% of Net Assets
ARIZONA: 3.5%
Aa AA Arizona State Transportation
Board, Highway Revenue,
6%, 7/1/08 $1,000,000 $1,082,500
CALIFORNIA: 3.4%
Aaa AAA San Jose Redevelopment Agency,
Tax Allocation (MBIA Insured),
6%, 8/1/09 1,000,000 1,058,750
DISTRICT OF COLUMBIA: 3.5%
Aaa AAA Metropolitan Washington D.C.
Airports Authority, Airport
Revenue (MBIA Insured) (AMT),
6.625%, 10/1/19 1,000,000 1,062,500
HAWAII: 5.3%
Aaa AAA Hawaii, Airport Revenue (FGIC
Insured) (AMT), 7%, 7/1/20 1,500,000 1,642,500
ILLINOIS: 1.1%
Aaa AAA Regional Transportation
Authority, Transit Revenue
(AMBAC Insured), 7.2%,
11/1/20 300,000 348,375
IOWA: 3.5%
Aaa AAA Mason City, Hospital Facilities
Revenue (Sisters of Mercy)
(FSA Insured), 7%, 8/15/14 1,000,000 1,086,250
KANSAS: 1.7%
Aa AA Kansas State Department of
Transportation, Highway
Revenue, 6.125%, 9/1/09 500,000 533,125
LOUISIANA: 5.1%
Aaa AAA Louisiana, General Obligation
(MBIA Insured), 6%, 5/15/15 500,000 508,125
Aaa AAA Louisiana State Energy and Power
Authority, Power Revenue
(Rodemacher Unit Number Two)
(FGIC Insured), 6.75%,
1/1/08 1,000,000 1,075,000
See Notes to Portfolios of Investments.
<PAGE>
National Portfolio
Portfolio of Investments - March 31, 1996 (continued)
Credit Rating* Principal
Moody's S&P Amount Value
MAINE: 1.6%
Aaa AAA Maine State Turnpike Authority,
Turnpike Revenue (MBIA
Insured), 6%, 7/1/18 $500,000 $506,250
MARYLAND: 1.7%
Aa nr Montgomery County, Single-Family
Mortgage Revenue, 6.65%,
7/1/17 500,000 516,250
MASSACHUSETTS: 5.4%
A1 A+ Massachusetts Bay Transportation
Authority, Transit Revenue, 7%,
3/1/14 1,000,000 1,148,750
Aa AA- Massachusetts, State Water
Pollution Abatement, 6.25%,
2/1/11 500,000 525,000
MICHIGAN: 2.7%
nr AA+ Michigan State Housing Development
Authority, Single-Family
Mortgage Revenue (AMT),
7.75%, 12/1/19 790,000 822,588
MISSISSIPPI: 4.2%
Aaa AAA Harrison County Wastewater
Management District, Sewer
Revenue (Wastewater Treatment
Facilities) (FGIC Insured),
8.5%, 2/1/13 500,000 668,750
Aaa AAA Harrison County Wastewater
Management District, Sewer
Revenue (Wastewater Treatment
Facilities) (FGIC Insured),
7.75%, 2/1/14 500,000 622,500
NEVADA: 1.7%
Aaa AAA Washoe County, Gas and Water
Facilities Revenue (AMBAC
Insured), 6.3%, 12/1/14 500,000 513,750
NEW JERSEY: 1.7%
Baa1 BBB+New Jersey State Turnpike
Authority, Highway Revenue,
6.5%, 1/1/16 500,000 526,875
NEW YORK: 1.6%
Baa1 BBB+New York, General Obligation,
6%, 2/15/15 500,000 480,625
PENNSYLVANIA: 8.8%
Aaa AAA Lehigh County, Hospital Revenue
(Lehigh Valley Hospital) (MBIA
Insured), 7%, 7/1/16 1,000,000 1,138,750
Aaa AAA Pennsylvania State Higher
Educational Facilities
Authority, University Revenue
(Duquesne University) (MBIA
Insured), 6.75%, 4/1/20 500,000 531,250
Aaa AAA Pennsylvania State Industrial
Development Authority, Economic
Development Revenue (AMBAC
Insured), 6%, 1/1/12 1,000,000 1,022,500
RHODE ISLAND: 1.7%
Aa1 AA Rhode Island State Health and
Higher Educational Facilities,
University Revenue (Brown
University), 6.75%, 9/1/16 500,000 518,750
SOUTH CAROLINA: 3.6%
Aaa AAA Piedmont Municipal Power Agency,
Electric Revenue (FGIC Insured),
6.5%, 1/1/16 1,000,000 1,096,250
TEXAS: 16.2%
Aaa AAA Conroe Independent School
District, General Obligation
(PSFG Insured), 6.4%, 8/1/10 475,000 500,531
Aa AA Harris County, General
Obligation, 6.5%, 8/15/15 1,000,000 1,082,500
Aaa AAA Lower Colorado River Authority,
Electric Revenue (FSA
Insured), 6%, 1/1/16 500,000 511,250
Aaa AAA Texas Public Building Authority,
Building Revenue (MBIA Insured),
7.125%, 8/1/11 1,500,000 1,741,875
Aaa AAA United Independent School
District, General Obligation
(PSFG Insured), 7%, 8/15/05 1,000,000 1,155,000
See Notes to Portfolios of Investments.
<PAGE>
Credit Rating* Principal
Moody's S&P Amount Value
VIRGINIA: 9.6%
Aaa AAA Chesapeake Bay Bridge and
Tunnel Commission, Highway
Revenue (MBIA Insured)
5.25%, 7/1/19 $500,000 $463,125
Aa AA Fairfax County Economic
Development Authority, Lease
Revenue, 5.5%, 5/15/14 500,000 485,000
nr A- Prince William County Park
Authority, Revenue, 6.875%,
10/15/16 500,000 531,875
A1 AA Richmond, General Obligation,
6.25%, 1/15/21 500,000 541,875
Aa AA Virginia Beach, General
Obligation, 6.2%, 9/1/13 500,000 525,625
Aa AA+ Virginia State Housing
Development Authority,
Multifamily Housing Revenue,
6.65%, 11/1/13 400,000 415,500
WASHINGTON: 8.6%
A1 AA- Port Seattle, Revenue (AMBAC
Insured) (AMT), 7.6%, 12/1/09 500,000 562,500
A1 A+ Snohomish County Public Utility
District, Electric Revenue,
7%, 1/1/16 1,000,000 1,061,250
Aa AA Washington, General Obligation,
6%, 9/1/20 500,000 509,375
Aa AA Washington State Public Power
Supply System, Power Revenue
(Nuclear Project Number Three),
6.5%, 7/1/18 500,000 515,625
WYOMING: 1.7%
Aaa AAA Wyoming Municipal Power Agency
Authority, Electric Revenue
(MBIA Insured), 6.125%,
1/1/16 500,000 510,000
TOTAL LONG-TERM MUNICIPAL BONDS
(Cost $29,459,596) $30,148,869
SHORT-TERM MUNICIPAL BONDS:
0.3% of Net Assets
MISSOURI: 0.3%
VMIG1A-1 Kansas City Industrial Development
Authority, Hospital Revenue
(Research Health Services
Systems) (MBIA Insured),
3.9%, 10/15/14^ 100,000 100,000
TOTAL SHORT-TERM MUNICIPAL BONDS (Cost $100,000) 100,000
TOTAL INVESTMENTS (Cost $29,559,596)+ $30,248,869
Money Market Portfolio
Portfolio of Investments - March 31, 1996
(Unaudited)
Credit Rating* Principal
Moody's S&P Amount Value
SHORT-TERM MUNICIPAL SECURITIES:
95.7% of Net Assets
CALIFORNIA: 4.5%
MIG1 Sp1+California School Cash Reserve
Program Authority, Property
Tax Revenue (LOC - Industrial
Bank of Japan), 4.75%,
7/3/96 $400,000 $400,824
FLORIDA: 1.5%
#Aaa AA Florida State Board of Education,
General Obligation, 7.25%,
6/1/10 * 125,000 128,240
GEORGIA: 4.5%
VMIG1 nr Marietta Housing Authority,
Multifamily Revenue (Falls
at Bells Ferry) (LOC - Guardian
S&L, Houston), 3.55%,
1/15/09^ 400,000 400,000
See Notes to Portfolios of Investments.
<PAGE>
Money Market Portfolio
Portfolio of Investments - March 31, 1996 (continued)
Credit Rating* Principal
Moody's S&P Amount Value
KANSAS: 4.5%
P-1 A-1+Burlington, Pollution Control
Revenue (Kansas City Power
and Light) (LOC - Duetsche
Bank A.G.), 3.25%, 10/1/17 ^ $400,000 $400,000
LOUISIANA: 9.1%
VMIG1 AAALouisiana Public Facilities
Authority, Hospital Revenue
(Willis-Knighton) (AMBAC
Insured), 3.5%, 9/1/23 ^ 300,000 300,000
VMIG1A-1+New Orleans Aviation Board,
Airport Revenue (MBIA
Insured), 3.35%, 8/1/16 ^ 400,000 400,000
Aa3 A-1+West Feliciana Parish, Pollution
Control Revenue (Gulf States
Utilities) (LOC - Canadian
Imperial Bank), 3.8%,
12/1/15 ^ 100,000 100,000
MARYLAND: 2.3%
Aaa AAA Gaithersburg, Hospital Revenue
(Shady Grove Adventist) (FSA
Insured), 4%, 9/1/96 200,000 200,406
MINNESOTA: 2.3%
VMIG1 nr Minnesota State Higher Education
(Student Loan Revenue), 3.3%,
12/1/00 ^ 200,000 200,000
MISSOURI: 4.5%
nr A-1+ Independence Industrial Development
Authority, Industrial Revenue
(Resthaven) (LOC - Credit
Local de France), 3.35%,
2/1/25 ^ 400,000 400,000
NEBRASKA: 4.5%
VMIG1 AAANebraska Higher Education Loan
Program, Student Loan Revenue
(MBIA Insured), 3.35%,
12/1/15 ^ 400,000 400,000
NEW MEXICO: 8.2%
Aaa AAA Farmington, Utility Revenue
(FGIC Insured), 9.75%,
5/15/13 * 315,000 322,281
VMIG1 nr Santa Fe, Single-Family Mortgage
Revenue (GNMA/FNMA
Collateralized), 4%, 11/1/28 *400,000 401,168
NEW YORK: 4.5%
VMIG1 AAATriborough Bridge and Tunnel
Authority, Highway Revenue
(MBIA Insured), 2%, 1/1/04 ^ 400,000 400,000
NORTH CAROLINA: 13.0%
VMIG1A-1+North Carolina Medical Care
Commission, Hospital Revenue
(MBIA Insured), 3.35%,
12/1/25 ^ 300,000 300,000
Aaa AAA North Carolina State, General
Obligation, 4.5%, 6/1/96 100,000 100,169
VMIG1 nr University of North Carolina,
University Revenue (Kenan
Memorial Stadium) (LOC -
Wachovia Bank and Trust),
3.3%, 11/1/07 ^ 250,000 250,000
nr A-1+Winston-Salem, Floating Risk
Acceptance Management
Corporation (Certificate of
Participation), 3.4%, 7/1/09 ^500,000 500,000
PENNSYLVANIA: 2.9%
Aaa AAA Pennsylvania Industrial
Development Authority, Economic
Development Revenue (AMBAC Insured),
5%, 7/1/96 250,000 250,603
SOUTH CAROLINA: 4.7%
Aaa AA+ South Carolina, General
Obligation, 6.5%, 2/1/97 400,000 410,212
TENNESSEE: 4.5%
Aaa AA+ Tennessee State, General
Obligation, 4.25%, 6/1/96 400,000 400,504
See Notes to Portfolio of Investments.
<PAGE>
Money Market Portfolio
Portfolio of Investments - March 31, 1996 (continued)
Credit Rating* Principal
Moody's S&P Amount Value
TEXAS: 9.1%
VMIG1A-1+Port Development Corporation,
Marine Terminal Revenue (Stolt
Terminals) (LOC - Credit Suisse,
N.Y.), 3.3%, 1/15/14 ^ $400,000 $400,000
nr A-1+ San Antonio Housing Finance
Corporation (Cape Cod
Apartments) (LOC - Landesbank
Hessen, NY) (AMT), 3.45%,
6/1/20 ^ 400,000 400,000
UTAH: 4.5%
VMIG1A-1+Salt Lake City, Airport Revenue
(LOC - Credit Suisse, N.Y.)
(AMT), 3.4%, 6/1/98 ^ 400,000 400,000
VIRGINIA: 2.6%
Aaa AAA Fairfax County, General
Obligation, 6.3%, 11/1/96 125,000 127,082
Aaa AAA Southeastern Public Service
Authority, Resource Recovery
Revenue (BIG Insured), 6.4%,
7/1/96 100,000 100,715
WASHINGTON: 4.0%
nr A-1+Port Kalama, Port Facilities
Revenue (Conagra) (LOC - Morgan
Guaranty Trust), 3.25%,
1/1/04 ^ 50,000 50,000
nr A-1+Washington State Housing Finance
Commission, Multifamily Mortgage
Revenue (LOC - Pacific First
Federal Savings), 3.5%,
7/1/20 ^ 300,000 300,000
TOTAL INVESTMENTS (Cost $8,442,611)+ $8,442,204
Notes to Portfolio of Investments:
* Putable before final maturity
+ Aggregate cost and net unrealized appreciation
(depreciation) of investments for federal income
tax purposes are as follows:
Arizona Maryland Missouri
Portfolio Portfolio Portfolio
Aggregate cost $8,729,341 $2,551,551 $10,703,072
Gross unrealized
appreciation $ 392,196 $ 45,386 $ 371,981
Gross unrealized
depreciation 4,299 13,887 82,759
Net unrealized appreciation
(depreciation) $ 387,897 $ 31,499 $ 289,222
Money
Virginia National Market
Portfolio Portfolio Portfolio
Aggregate cost $32,805,737 $29,559,596 $ 8,442,611
Gross unrealized
appreciation $ 1,190,697 $ 872,079 $ 1,556
Gross unrealized
depreciation 139,584 182,806 1,963
Net unrealized appreciation
(depreciation $ 1,051,113 $ 689,273 $ (407)
^ Security has a variable coupon rate and is putable
before final maturity. Coupon rate as of March 31,
1996
#Aaa Refunded Bonds
AMBAC American Municipal Bond Assurance Corporation
AMT Subject to Alternative Minimum Tax
BIG Bond Investors Guaranty Insurance Company
CGIC Capital Guaranty Insurance Company
FGIC Financial Guaranty Insurance Company
FHA Federal Housing Administration
FNMA Federal National Mortgage Association
FSA Federal Security Assistance
GNMA Government National Mortgage Association
LOC Letter of Credit
MBIA Municipal Bond Investors Assurance Corporation
Moody's Moody's Investors Service, Inc.
nr Not rated
PSFG Permanent School Fund Guaranty
S&P Standard & Poor's Corporation
<PAGE>
Statements of Assets and Liabilities
March 31, 1996
(Unaudited)
Arizona Maryland Missouri
Portfolio Portfolio Portfolio
ASSETS
Investments, at cost $8,729,341 $2,551,551 $10,703,072
Investments, at value
(Note 1) $9,117,238 $2,583,050 $10,992,294
Cash 83,371 121,912 181,944
Receivables
Investment securities
sold -- -- --
Interest 144,981 42,779 163,443
Capital shares sold -- -- --
Share subscriptions
receivable (Note 1) -- -- --
Other assets -- -- 2
Total assets 9,345,590 2,747,741 11,337,683
LIABILITIES
Payables
Investment securities
purchased -- -- --
Dividends 10,014 711 6,426
Capital shares redeemed 121 500 --
Shares reserved for
subscription (Note 1) -- -- --
Other liabilities 2 20 --
Total liabilities 10,137 1,231 6,426
NET ASSETS (Note 4) $9,335,453 $2,746,510 $11,331,257
CAPITAL SHARES
OUTSTANDING 918,342 282,376 1,109,685
NET ASSET VALUE PER SHARE $10.166 $9.726 $10.211
Money
Virginia National Market
Portfolio Portfolio Portfolio
ASSETS
Investments, at cost $32,805,737 $29,559,596 $8,442,611
Investments, at value
(Note 1) $33,856,850 $30,248,869 $8,442,204
Cash 197,572 132,371 302,740
Receivables
Investment securities
sold 501,487 -- --
Interest 606,945 437,487 76,361
Capital shares sold -- -- 16
Share subscriptions
receivable (Note 1) 1,350 200 1,000
Other assets 196 -- --
Total assets 35,164,400 30,818,927 8,822,321
LIABILITIES
Payables
Investment securities
purchased 537,645 -- --
Dividends 18,242 8,887 636
Capital shares redeemed 12,395 -- --
Shares reserved for
subscription (Note 1) 1,350 200 1,000
Other liabilities 47 100 31
Total liabilities 569,679 9,187 1,667
NET ASSETS (Note 4) $34,594,721 $30,809,740 $8,820,654
CAPITAL SHARES
OUTSTANDING 3,097,299 3,000,109 8,821,232
NET ASSET VALUE PER
SHARE $11.169 $10.270 $1.000
Statements of Operations
For the Six Months Ended March 31, 1996
(Unaudited)
Arizona Maryland Missouri
Portfolio Portfolio Portfolio
INVESTMENT INCOME
(Note 1)
Interest income $279,003 $73,588 $317,915
EXPENSES (Notes 3 and 4)
Investment advisory fee30,722 8,902 36,037
Custodian fees 2,946 2,200 4,865
Professional fees 4,582 2,376 4,920
Salaries and related
expenses 15,935 5,990 18,851
Securities registration
and blue sky expenses 566 1,008 916
Telephone expense 955 359 1,132
Data processing and
office equipment
expense 6,888 4,915 7,451
Office and
miscellaneous expenses 3,419 1,560 3,519
Depreciation and
amortization 445 167 524
Custodian fees paid
indirectly (1,326) (1,594) (2,969)
Expenses incurred and
paid by investment
adviser -- (8,902) --
Total expenses 65,132 16,981 75,246
NET INVESTMENT INCOME 213,871 56,607 242,669
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS
Net realized gain
on investments 22,147 3,431 67,446
Net unrealized
appreciation
(depreciation) 38,914 (4,447) 25,762
NET GAIN (LOSS) ON
INVESTMENTS 61,061 (1,016) 93,208
TOTAL INCREASE IN NET
ASSETS RESULTING FROM
OPERATIONS $274,932 $55,591 $335,877
Money
Virginia National Market
Portfolio Portfolio Portfolio
INVESTMENT INCOME
(Note 1)
Interest income $981,304 $877,366 $149,828
EXPENSES (Notes 3 and 4)
Investment advisory
fee 108,117 100,364 21,592
Custodian fees 9,180 8,846 3,881
Professional fees 11,789 11,399 3,579
Salaries and related
expenses 51,037 47,783 11,530
Securities registration
and blue sky expenses 264 5,000 3,004
Telephone expense 3,067 2,865 694
Data processing and
office equipment
expense 18,830 16,632 3,876
Office and
miscellaneous
expenses 10,072 9,294 2,561
Depreciation and
amortization 1,421 1,333 322
Custodian fees paid
indirectly (4,024) (4,014) (2,719)
Expenses incurred and
paid by investment
adviser -- -- (13,341)
Total expenses 209,753 199,502 34,979
NET INVESTMENT INCOME 771,551 677,864 114,849
REALIZED AND UNREALIZED
GAIN (LOSS) ON INVESTMENTS
Net realized gain on
investments 243,017 231,505 --
Net unrealized
appreciation
(depreciation) (80,581) (12,844) 153
NET GAIN (LOSS) ON
INVESTMENTS 162,436 218,661 153
TOTAL INCREASE IN NET ASSETS
RESULTING FROM
OPERATIONS $933,987 $896,525 $115,002
The Notes to Financial Statements are an integral part of these statements.
<PAGE>
Statements of Changes in Net Assets
Arizona Portfolio
Six Months Ended
March 31, 1996 Year Ended
(Unaudited) Sept. 30, 1995
INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS
Net investment income $ 213,871 $ 465,682
Net realized gain (loss)
on investments 22,147 (270,014)
Net unrealized appreciation
(depreciation)of investments38,914 636,688
Total increase in net assets
resulting from operations 274,932 832,356
DISTRIBUTIONS TO SHAREHOLDERS
Net investment income (213,871) (465,682)
CAPITAL SHARE TRANSACTIONS
(Note 6) (734,333) (2,172,806)
TOTAL DECREASE IN NET
ASSETS (673,272) (1,806,132)
NET ASSETS
Beginning of period 10,008,725 11,814,857
End of period $ 9,335,453 $10,008,725
Maryland Portfolio
Six Months Ended
March 31, 1996 Year Ended
(Unaudited) Sept. 30, 1995
INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS
Net investment income $ 56,607 $ 131,139
Net realized gain (loss)
on investments 3,431 (30,774)
Net unrealized appreciation
(depreciation) of
investments (4,447) 153,130
Total increase in net assets
resulting from operations 55,591 253,495
DISTRIBUTIONS TO SHAREHOLDERS
Net investment income (56,607) (131,139)
CAPITAL SHARE TRANSACTIONS
(Note 6) (132,595) (324,850)
TOTAL DECREASE IN NET
ASSETS (133,611) (202,494)
NET ASSETS
Beginning of period 2,880,121 3,082,615
End of period $2,746,510 $2,880,121
Missouri Portfolio
Six Months Ended
March 31, 1996 Year Ended
(Unaudited) Sept. 30, 1995
INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS
Net investment income $ 242,669 $ 492,896
Net realized gain (loss)
on investments 67,446 (116,168)
Net unrealized appreciation
(depreciation) of
investments 25,762 537,355
Total increase in net assets
resulting from operations 335,877 914,083
DISTRIBUTIONS TO SHAREHOLDERS
Net investment income (242,669) (492,896)
CAPITAL SHARE TRANSACTIONS
(Note 6) (155,617) (517,675)
TOTAL DECREASE IN NET ASSETS (62,409) (96,488)
NET ASSETS
Beginning of period 11,393,666 11,490,154
End of period $11,331,257 $11,393,666
Virginia Portfolio
Six Months Ended
March 31, 1996 Year Ended
(Unaudited) Sept. 30, 1995
INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS
Net investment income $ 771,551 $ 1,560,008
Net realized gain (loss)
on investments 243,017 (335,404)
Net unrealized appreciation
(depreciation) of
investments (80,581) 1,732,461
Total increase in net assets
resulting from operations 933,987 2,957,065
DISTRIBUTIONS TO SHAREHOLDERS
Net investment income (771,551) (1,560,008)
CAPITAL SHARE TRANSACTIONS
(Note 6) 609,932 (3,124,224)
TOTAL INCREASE (DECREASE)
IN NET ASSETS 772,368 (1,727,167)
NET ASSETS
Beginning of period 33,822,353 35,549,520
End of period $34,594,721 $33,822,353
National Portfolio
Six Months Ended
March 31, 1996 Year Ended
(Unaudited) Sept. 30, 1995
INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS
Net investment income $ 677,864 $ 1,460,221
Net realized gain (loss)
on investments 231,505 (565,552)
Net unrealized appreciation
(depreciation) of
investments (12,844) 1,689,690
Total increase in net assets
resulting from operations 896,525 2,584,359
DISTRIBUTIONS TO SHAREHOLDERS
Net investment income (677,864) (1,460,221)
CAPITAL SHARE TRANSACTIONS
(Note 6) (2,143,314) (2,461,944)
TOTAL INCREASE (DECREASE)
IN NET ASSETS (1,924,653) (1,337,806)
NET ASSETS
Beginning of period 32,734,393 34,072,199
End of period $30,809,740 $32,734,393
Money Market Portfolio
Six Months Ended
March 31, 1996 Year Ended
(Unaudited) Sept. 30, 1995
INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS
Net investment income $ 114,849 $ 255,638
Net realized gain (loss)
on investments -- 105
Net unrealized appreciation
(depreciation) of
investments 153 2,310
Total increase in net assets
resulting from operations 115,002 258,053
DISTRIBUTIONS TO SHAREHOLDERS
Net investment income (114,954) (255,638)
CAPITAL SHARE TRANSACTIONS
(Note 6) 366,362 (464,511)
TOTAL INCREASE (DECREASE)
IN NET ASSETS 366,410 (462,096)
NET ASSETS
Beginning of period 8,454,244 8,916,340
End of period $8,820,654 $8,454,244
The Notes to Financial Statements are an integral part of
these statements.
<PAGE>
Financial Highlights
Selected data for a share outstanding throughout each
period:
<TABLE>
<CAPTION>
Arizona Portfolio
6-Months
Ended
Mar 31 Years ended September 30,
<C> <C> <C> <C> <C> <C>
1996# 1995 1994 1993 1992 1991
Net asset
value
beginning
of period $10.113 9.706 11.208 10.568 10.187 9.703
Net
investment
income $0.223 0.440 0.436 0.490 0.528 0.569
Net
realized &
unrealized
gains
(losses) on
securities $0.053 0.407 (1.102) 0.786 0.434 0.484
Total from
investment
operations $0.276 0.847 (0.666) 1.276 0.962 1.053
Distributions
from net
investment
income $(0.223)(0.440)(0.436)(0.490)(0.528)(0.569)
Distributions
from capital
gains $ -- -- (0.400)(0.146)(0.053) --
Total
Distributions$(0.223)(0.440)(0.836)(0.636)(0.581)(0.569)
Net asset
value end
of period $10.166 10.113 9.706 11.208 10.568 10.187
Total
Return 5.45%** 8.95% (6.20)%12.57% 9.74% 11.11%
Net assets
at end of
period
(thousands) $ 9,335 10,009 11,815 15,471 11,911 8,061
Ratio of
expenses to
average net
assets*** 1.35%***1.31% 1.29% 1.23% 1.15% 0.47%
Net
investment
income to
average
net assets 4.34%**4.48% 4.23% 4.54% 5.14% 5.61%
Portfolio
turnover -- 24% 67% 63% 23% 57%
Maryland Portfolio
6-Months
Ended
Mar 31 Years ended September 30,
<C> <C> <C> <C>
1996# 1995 1994 1993#
Net asset
value
beginning
of period $ 9.738 9.323 10.441 10.000
Net
investment
income $ 0.197 0.418 0.455 0.274
Net
realized &
unrealized
gains
(losses) on
securities $(0.012) 0.415 (1.102) 0.441
Total from
investment
operations $0.185 0.833 (0.647) 0.715
Distributions
from net
investment
income $(0.197)(0.418)(0.455)(0.274)
Distributions
from capital
gains $ -- -- (0.016) --
Total
Distributions$(0.197)(0.418)(0.471)(0.274)
Net asset
value end
of period $ 9.726 9.738 9.323 10.441
Total
Return 3.76%** 9.17% (6.33)%11.91%**
Net assets
at end of
period
(thousands) $2,747 2,880 3,083 3,377
Ratio of
expenses to
average net
assets*** 1.31%***0.87% 0.64% 0.20%**
Net
investment
income to
average
net assets 3.99%** 4.42% 4.60% 4.72%**
Portfolio
turnover 15% 9% 78% 35%
* For the period from February 10, 1993 (inception)
to September 30, 1993.
Missouri Portfolio
6-Months
Ended
Mar 31 Years ended September 30,
<C> <C> <C> <C> <C> <C>
1996# 1995 1994 1993 1992 1991
Net asset
value
beginning
of period $10.113 9.728 11.173 10.468 10.117 9.684
Net
investment
income $0.217 0.436 0.437 0.494 0.514 0.585
Net
realized &
unrealized
gains
(losses) on
securities $0.078 0.405 (1.058) 0.726 0.377 0.433
Total from
investment
operations $0.295 0.841 (0.621) 1.220 0.891 1.018
Distributions
from net
investment
income $(0.217)(0.436)(0.437)(0.494)(0.514)(0.585)
Distributions
from capital
gains $ -- -- (0.387)(0.021)(0.026) --
Total
Distributions$(0.217)(0.436)(0.824)(0.515)(0.540)(0.585)
Net asset
value end
of period $10.211 10.133 9.728 11.173 10.468 10.117
Total
Return 5.80%** 8.87% (5.80)%11.98% 9.06% 10.80%
Net assets
at end of
period
(thousands) $11,331 11,394 11,490 14,001 11,023 7,227
Ratio of
expenses to
average net
assets*** 1.35%***1.31% 1.29% 1.23% 1.18% 0.45%
Net
investment
income to
average
net assets 4.19%**4.43% 4.23% 4.59% 5.05% 5.85%
Portfolio
turnover 9% 16% 52% 65% 8% 33%
Virginia Portfolio
6-Months
Ended
Mar 31 Years ended September 30,
<C> <C> <C> <C> <C> <C>
1996# 1995 1994 1993 1992 1991
Net asset
value
beginning
of period $11.115 10.631 12.372 11.621 11.351 10.832
Net
investment
income $ 0.252 0.503 0.479 0.569 0.592 0.609
Net
realized &
unrealized
gains
(losses) on
securities $0.054 0.484 (1.146) 0.871 0.387 0.519
Total from
investment
operations $0.306 0.987 (0.667) 1.440 0.979 1.128
Distributions
from net
investment
income $(0.252)(0.503)(0.479)(0.569)(0.592)(0.609)
Distributions
from capital
gains $ -- -- (0.595)(0.120)(0.117) --
Total
Distributions$(0.252)(0.503)(1.074)(0.689)(0.709)(0.609)
Net asset
value end
of period $11.169 11.115 10.631 12.372 11.621 11.351
Total
Return 5.46%** 9.54% (5.67)%12.85% 8.92% 10.66%
Net assets
at end of
period
(thousands) $34,595 33,822 35,550 44,092 37,421 30,696
Ratio of
expenses to
average net
assets*** 1.23%***1.14% 1.18% 1.10% 1.13% 1.18%
Net
investment
income to
average
net assets 4.44%** 4.68% 4.23% 4.80% 5.20% 5.47%
Portfolio
turnover 16% 55% 104% 80% 74% 73%
National Portfolio*
6-Months
Ended
Mar 31 Years ended September 30,
<C> <C> <C> <C> <C> <C>
1996# 1995 1994 1993 1992 1991
Net asset
value
beginning
of period $10.211 9.851 11.910 11.329 10.794 10.364
Net
investment
income $ 0.219 0.446 0.420 0.550 0.605 0.632
Net
realized &
unrealized
gains
(losses) on
securities $0.059 0.360 (1.122) 0.793 0.535 0.430
Total from
investment
operations $0.278 0.806 (0.702) 1.343 1.140 1.062
Distributions
from net
investment
income $(0.219)(0.446)(0.420)(0.550)(0.605)(0.632)
Distributions
from capital
gains $ -- -- (0.937)(0.212) -- --
Total
Distributions$(0.219)(0.446)(1.357)(0.762)(0.605)(0.632)
Net asset
value end
of period $10.270 10.211 9.851 11.910 11.329 10.794
Total
Return 5.43%** 8.40% (6.25)%12.44% 10.83% 10.50%
Net assets
at end of
period
(thousands) $30,810 32,734 34,072 42,483 41,273 40,352
Ratio of
expenses to
average net
assets*** 1.26%***1.18% 1.23% 1.10% 1.17% 1.24%
Net
investment
income to
average
net assets 4.21%** 4.49% 3.98% 4.83% 5.47% 5.95%
Portfolio
turnover 24% 56% 175% 212% 114% 91%
Money Market Portfolio
6-Months
Ended
Mar 31 Years ended September 30,
<C> <C> <C> <C> <C> <C>
1996# 1995 1994 1993 1992 1991
Net asset
value
beginning
of period $ 1.000 1.000 1.000 1.000 1.000 1.000
Net
investment
income $ 0.013 0.028 0.015 0.020 0.030 0.040
Net
realized &
unrealized
gains
(losses) on
securities $ -- -- -- -- -- --
Total from
investment
operations $ 0.013 0.028 0.015 0.020 0.030 0.040
Distributions
from net
investment
income $(0.013)(0.028)(0.015)(0.020)(0.030)(0.040)
Distributions
from capital
gains $ -- -- -- -- -- --
Total
distributions$(0.013)(0.028)(0.015)(0.020)(0.030)(0.040)
Net asset
value end
of period $ 1.000 1.000 1.000 1.000 1.000 1.000
Total
Return 2.66%**2.87% 1.56% 1.53% 2.57% 4.13%
Net assets
at end of
period
(thousands) $8,821 8,454 8,916 13,391 14,861 17,844
Ratio of
expenses to
average net
assets*** 0.87%***0.81% 0.81% 0.81% 0.83% 0.81%
Net
investment
income to
average
net assets 2.65%** 2.83% 1.52% 1.52% 2.55% 4.12%
Portfolio
turnover -- -- -- -- -- --
# For the six months ended March 31, 1996 (unaudited)
## For the period from February 10, 1993 (inception) to
September 30, 1993
** Annualized
*** For the six months ended March 31, 1996, ratio reflects
custodian fees paid indirectly (Note 3).
</TABLE>
The Notes to Financial Statements are an integral part of
these statements.
<PAGE>
GIT Tax-Free Trust
Notes to Financial Statements
March 31, 1996
(Unaudited)
1. Summary of Significant Accounting Policies. GIT Tax-Free
Trust (the "Trust") is registered with the Securities and
Exchange Commission under the Investment Company Act of 1940
as an open-end, diversified investment management company.
The Trust maintains six separate portfolios which invest
principally in securities exempt from federal income taxes,
commonly known as "municipal" securities. The Arizona,
Maryland, Missouri and Virginia Portfolios (the "State
Portfolios") invest solely in securities exempt from both
federal and state income taxes in their respective states.
The National Portfolio (High Yield Portfolio prior to
February 1, 1993) seeks higher yields and invests in long-
term securities. The Money Market Portfolio invests in
short-term securities and is priced according to the "penny
rounding" method whereby the share price is rounded to the
nearest cent to maintain a stable share price of $1.00. The
State and National Portfolios' price per share fluctuates as
the market value of the respective underlying portfolio of
securities fluctuates.
Securities Valuation: Securities having maturities of 60
days or less are valued at amortized cost, which
approximates market value. Securities having longer
maturities, for which market quotations are readily
available are valued at the mean between their bid and asked
prices. Securities for which market quotations are not
readily available are valued at their fair value as
determined in good faith by the trustees. Investment
transactions are recorded on the trade date. The cost of
investments sold is determined on the identified cost basis
for financial statement and federal income tax purposes.
Investment Income: Interest income, net of amortization of
premium and original issue discount, and other income (if
any) is accrued as earned.
Dividends: Net investment income, determined as gross
investment income less expenses, is declared as a regular
dividend each business day. Declared dividends are
distributed to shareholders or reinvested in additional
shares as of the close of business at the end of each month.
For the National and State Portfolios, realized gains and
losses and unrealized appreciation and depreciation are
reflected as changes in net asset value per share and do not
affect regular dividends paid. Capital gain dividends,
reflecting net realized capital gains of each portfolio (if
any) are declared and paid at least once per year.
Additional distributions will be made if necessary.
Income Tax: In accordance with the provisions of Subchapter
M of the Internal Revenue Code applicable to regulated
investment companies, all taxable income of each portfolio
(if any) is distributed to its shareholders, and therefore,
no federal income tax provision is required. As of
September 30, 1995 capital loss carryover available which
may offset future capital gains, for federal income tax
purposes was $584,430 for the Arizona Portfolio; $184,066
for the Maryland Portfolio; $340,800 for the Missouri
Portfolio; $1,458,791 for the Virginia Portfolio; and
$2,256,504 for the National Portfolio. The preceding
carryover expires September 30, 2003. As of September 30,
1995 capital loss carryover available for the Money Market
Portfolio is $114, which expires September 30, 1998.
Share Subscriptions: Shares purchased by check or otherwise
not paid for in immediately available funds are accounted
for as share subscriptions receivable and shares reserved
for subscriptions.
Use of Estimates: The preparation of the financial
statements in conformity with generally accepted accounting
principles requires management to make estimates and
assumptions that affect the reported amounts of assets and
liabilities and reported amounts of increases and decreases
in net assets from operations during the reporting period.
Actual results could differ from those estimates.
2. Investment Advisory Fees and Other Transactions with
Affiliates. The investment adviser to the Trust, Bankers
Finance Investment Management Corp. ("BFIMC"), earns an
advisory fee equal to 0.625% per annum of the
<PAGE>
Notes to Financial Statements (continued)
average net assets of the State and National Portfolios and
0.5% per annum of the average net assets of the Money Market
Portfolio; the fees accrue daily and are payable monthly.
For the six months ended March 31, 1996, BFIMC waived $8,902
of such fees for the Maryland Portfolio. In order to meet
the securities registration requirements of certain states,
BFIMC has undertaken to reimburse the Trust by the amount,
if any, by which the total expenses of the Trust (less
certain excepted expenses) exceed the applicable expense
limitation in any state or other jurisdiction in which the
Trust is subject to regulation during the fiscal year. The
Trust believes the current applicable expense limitation is
2.5% per annum of the average net assets of the Trust up to
$30 million, 2% of any amount of such net assets exceeding
$30 million but not exceeding $100 million, and 1.5% per
annum of such amount in excess of $100 million. BFIMC is
responsible for the fees and expenses of trustees who are
affiliated with BFIMC, the rent expense of the Trust's
principal executive office premises and certain promotional
expenses. For the six months ended March 31, 996, outside
trustee fees were $1,000 for each portfolio. As of March
31, 1996, certain officers, trustees, companies and
individuals affiliated with the Trust had investments
aggregating 0.2%, 0.3% and 0.5% of the National, Arizona and
Money Market Portfolios' shares outstanding, respectively.
As of March 31, 1996, no outstanding shares of the Maryland,
Missouri or Virginia Portfolios were owned by any officer,
trustee, affiliated company or affiliated individual.
3. Other Expenses. With the exception of certain expenses
of the Trust payable by it directly, all support services
are provided to the Trust under a services agreement between
the Trust and BFIMC, pursuant to which, such services are to
be provided for amounts not exceeding the cost to BFIMC of
the support provided. Common expenses incurred by the Trust
are allocated among the portfolios based on the ratio of net
assets of each portfolio to the combined net assets. For
the six months ended March 31, 1996, expenses of $34,410 for
the Arizona Portfolio; $16,981 for the Maryland Portfolio;
$39,209 for the Missouri Portfolio; $101,636 for the
Virginia Portfolio; $99,138 for the National Portfolio; and
$13,387 for the Money Market Portfolio have been reimbursed
to BFIMC under the Services Agreement. As of March 31,
1996, expenses of $14,970 for the Arizona Portfolio; $4,470
for the Maryland Portfolio; and $4,509 for the Missouri
Portfolio have been incurred by BFIMC on behalf of the
portfolios, the billings of which have been deferred. For
the six months ended March 31, 1996, BFIMC incurred expenses
of $13,341 on behalf of the Money Market Portfolio, the
billing of which has been waived.
Custodian fees are reduced under an expense offset
arrangement with the Trust's Custodian. The amount of the
expense offset for the year ended March 31, 1996 was $1,326
for the Arizona Portfolio; $1,594 for the Maryland
Portfolio; $2,969 for the Missouri Portfolio; $4,024 for the
Virginia Portfolio; $4,014 for the National Portfolio; and
$2,719 for the Money Market Portfolio.
<PAGE>
Notes to Financial Statements (continued)
Had BFIMC not waived the billing advisory fees or expenses
for the Arizona Portfolio, Maryland Portfolio, Missouri
Portfolio, and Money Market Portfolio, the ratios of
expenses and net investment income to average net assets
would have been:
Ratio of Ratio of
expense to net investment
Year ended average net income to average
September 30 assets*** net assets
Arizona Portfolio 1991 1.20% 4.88%
Maryland
Portfolio** 1996## 1.93%* 3.36%*
1995 1.50 3.80
1994 1.34 3.90
1993# 1.74* 3.18*
Missouri Portfolio 1991 1.28% 5.02%
Money Market
Portfolio 1996## 1.18%* 2.34%*
1995 1.07 2.56
1994 1.02 1.31
1993 1.03 1.30
1992 1.02 2.36
1991 1.01 3.91
* Annualized
# For the period from February 10, 1993 (inception) to
September 30, 1993
** For the periods ended September 30, 1994 and 1993,
ratios include expenses of which the billing has
been deferred.
## For the six months ending March 31, 1996
*** For the six months ended March 31, 1996, the ratio
reflects custodian fees paid indirectly.
4. Net Assets. At March 31, 1996, net assets included the following:
Arizona Maryland Missouri
Portfolio Portfolio Portfolio
Net paid in capital on
shares of beneficial
interest $9,509,839 $2,895,647 $11,315,388
Accumulated net realized
losses (562,282) (180,636) (273,353)
Net unrealized appreciation
(depreciation)
of investments 387,896 31,499 289,222
Total net assets $9,335,453 $2,746,510 $11,331,257
Money
Virginia National Market
Portfolio Portfolio Portfolio
Net paid in capital on
shares of beneficial
interest $34,759,381 $32,145,467 $8,821,232
Accumulated net realized
losses (1,215,773) (2,024,999) (171)
Net unrealized appreciation
(depreciation)
of investments 1,051,113 689,272 (407)
Total net assets $34,594,721 $30,809,740 $8,820,654
5. Investment Transactions. Purchases and sales of
securities other than short-term securities, for the six
months ended March 31, 1996, were as follows:
Arizona Maryland Missouri
Portfolio Portfolio Portfolio
Purchases -- $414,279 $1,119,056
Sales $510,545 555,319 969,471
Virginia National
Portfolio Portfolio
Purchases $5,954,254 $7,511,626
Sales 5,291,300 8,690,182
<PAGE>
Notes to Financial Statements (continued)
6. Capital Share Transactions. An unlimited number of
capital shares, without par value, are authorized.
Transactions in capital shares were as follows:
Arizona Portfolio
Six Months Ended Year Ended
March 31, 1996 September 30, 1995
In Dollars
Shares sold $ 504,114 $ 1,043,837
Shares issued in
reinvestment
of dividends 152,637 325,705
Total shares issued 656,751 1,369,542
Shares redeemed (1,391,084) (3,542,348)
Net decrease $ (734,333) (2,172,806)
In Shares
Shares sold 48,930 105,634
Shares issued in
reinvestment
of dividends 14,818 33,184
Total shares issued 63,748 138,818
Shares redeemed (135,053) (366,427)
Net decrease (71,305) (227,609)
Maryland Portfolio
Six Months Ended Year Ended
March 31, 1996 September 30, 1995
In Dollars
Shares sold $ 443,611 $ 839,221
Shares issued in
reinvestment
of dividends 122,234 205,051
Total shares issued 961,455 722,643
Shares redeemed (628,396) (1,286,305)
Net decrease $ (132,595) $ (324,850)
In Shares
Shares sold 44,902 89,232
Shares issued in
reinvestment
of dividends 5,277 12,957
Total shares issued 50,179 102,189
Shares redeemed (63,552) (137,100)
Net decrease (13,373) (34,911)
Missouri Portfolio
Six Months Ended Year Ended
March 31, 1996 September 30, 1995
In Dollars
Shares sold $ 517,592 $ 1,645,931
Shares issued in
reinvestment
of dividends 205,051 408,754
Total shares issued 722,643 2,054,685
Shares redeemed (878,260) (2,572,360)
Net decrease $ (155,617) $ (517,675)
In Shares
Shares sold 50,051 166,322
Shares issued in
reinvestment
of dividends 19,760 41,558
Total shares issued 69,811 207,880
Shares redeemed (84,520) (264,672)
Net decrease (14,709) (56,792)
Virginia Portfolio
Six Months Ended Year Ended
March 31, 1996 September 30, 1995
In Dollars
Shares sold $ 2,764,540 $ 4,967,609
Shares issued in
reinvestment
of dividends 661,729 1,335,773
Total shares issued 3,426,269 6,303,382
Shares redeemed (2,816,337) (9,427,606)
Net increase (decrease)$ 609,932 $ (3,124,224)
In Shares
Shares sold 244,372 463,732
Shares issued in
reinvestment
of dividends 58,265 124,012
Total shares issued 302,637 587,744
Shares redeemed (248,392) (888,537)
Net increase (decrease) 54,245 (300,793)
National Portfolio
Six Months Ended Year Ended
March 31, 1996 September 30, 1995
In Dollars
Shares sold $ 1,432,279 $ 3,422,847
Shares issued in
reinvestment
of dividends 615,502 1,307,981
Total shares issued 2,047,781 4,730,828
Shares redeemed (4,191,095) (7,192,772)
Net increase (decrease)$ (2,143,314) $ (2,461,944)
In Shares
Shares sold 137,223 344,542
Shares issued in
reinvestment
of dividends 58,966 131,677
Total shares issued 196,189 476,219
Shares redeemed (401,920) (729,127)
Net increase (decrease) (205,731) (252,908)
Money Market Portfolio
Six Months Ended Year Ended
March 31, 1996 September 30, 1995
In Dollars
Shares sold $ 3,740,570 $ 8,322,074
Shares issued in
reinvestment
of dividends 110,273 244,526
Total shares issued 3,850,843 8,566,600
Shares redeemed (3,484,481) (9,031,111)
Net increase (decrease)$ 366,362 $ (464,511)
In Shares
Shares sold 3,740,570 8,322,074
Shares issued in
reinvestment
of dividends 110,273 244,526
Total shares issued 3,850,843 8,566,600
Shares redeemed (3,484,481) (9,031,111)
Net increase (decrease) 366,362 (464,511)
<PAGE>
Telephone Numbers
Shareholder Service
Washington, DC area: 703/528-6500
Toll-free nationwide: 800/336-3063
24-Hour ACCESS
Toll-free nationwide: 800/448-4422
The GIT Family of Mutual Funds
GIT Equity Trust
Special Growth Portfolio
Select Growth Portfolio
Equity Income Portfolio
Worldwide Growth Portfolio
GIT Income Trust
Maximum Income Portfolio
Government Portfolio
GIT Tax-Free Trust
Arizona Portfolio
Maryland Portfolio
Missouri Portfolio
Virginia Portfolio
National Portfolio
Money Market Portfolio
Government Investors Trust
For more complete information on any GIT Investment Fund,
including charges and expenses, request a prospectus by
calling the numbers above. Read it carefully before you
invest or send money. This prospectus does not constitute an
offering by the distributor in any jurisdiction in which such
offering may not be lawfully made.
GIT
GIT INVESTMENT FUNDS
1655 Fort Myer Drive
Arlington Virginia 22209
http://www.gitfunds.com
