ALLIANCE MUNICIPAL TRUST -MASSACHUSETTS PORTFOLIO
ALLIANCE CAPITAL
ANNUAL REPORT
JUNE 30, 1998
STATEMENT OF NET ASSETS
JUNE 30, 1998
ALLIANCE MUNICIPAL TRUST - MASSACHUSETTS PORTFOLIO
_______________________________________________________________________________
PRINCIPAL
AMOUNT
(000) SECURITY# YIELD VALUE
- -------------------------------------------------------------------------
MUNICIPAL BONDS-102.9%
MASSACHUSETTS-75.6%
AYER BAN
Series '98 AMBAC
$ 419 4/01/99 3.90% $ 428,476
BRIDGEWATER GO
Golf Course Revenue
Series '97 AMBAC
140 7/15/98 3.93 140,147
BROOKLINE GO
Series '98
777 6/01/99 3.77 792,440
CHATHAM GO
MBIA
500 7/01/98 3.83 500,000
DUDLEY BAN
Series '98 FSA
235 3/15/99 3.69 239,523
GARDNER GO
FGIC Series '97
1,000 11/01/98 3.88 1,010,246
GEORGETOWN GO
Series '98 MBIA
375 5/01/99 3.80 377,728
HINGHAM GO
Series '98
320 2/15/99 3.71 324,459
HOLDEN BAN
Series '97
1,000 10/01/98 3.92 1,000,799
LITTLETON GO
MBIA
270 9/15/98 3.88 271,704
MASSACHUSETTS AMBAC
Series '89C Pre-Refunded
300 6/01/99 3.90 314,050
MASSACHUSETTS
EDUCATIONAL FINANCING AUTHORITY
Student Loan Revenue
Series '98C AMT VRDN (a)
1,300 12/01/17 3.50 1,300,000
MASSACHUSETTS HEALTH &
EDUCATION FACILITY
(Amherst College) VRDN (a)
1,000 11/01/26 3.40 1,000,000
MASSACHUSETTS HEALTH &
EDUCATION FACILITY
(Falmouth Assisted Living)
Series '95A VRDN (a)
500 11/01/26 3.40 500,000
MASSACHUSETTS HEALTH &
EDUCATION FACILITY
(Harvard University)
Series '85 VRDN (a)
800 8/01/17 3.40 800,000
MASSACHUSETTS HEALTH &
EDUCATION FACILITY
(Harvard University)
Series '85Q-Z VRDN (a)
200 9/01/40 3.40 200,000
MASSACHUSETTS IFA
(ADP Inc. Project)
Series '97 VRDN (a)
1,000 12/01/19 4.00 1,000,000
MASSACHUSETTS IFA
(Berkshire Project)
Series '90 VRDN (a)
1,200 9/01/20 3.55 1,200,000
MASSACHUSETTS IFA
(Carand Realty Trust)
AMT VRDN (a)
925 5/01/17 3.55 925,000
MASSACHUSETTS IFA
(Gordon College Project)
Series '97 VRDN (a)
500 12/01/27 3.40 500,000
MASSACHUSETTS IFA
(Mount Ida College Project)
Series '97 AMT VRDN (a)
1,000 12/01/27 3.40 1,000,000
1
STATEMENT OF NET ASSETS(CONTINUED)
ALLIANCE MUNICIPAL TRUST - MASSACHUSETTS PORTFOLIO
_______________________________________________________________________________
PRINCIPAL
AMOUNT
(000) SECURITY# YIELD VALUE
- -------------------------------------------------------------------------
MASSACHUSETTS IFA
(Newbury College Project)
Series '96 VRDN (a)
$ 691 6/01/21 3.40% $ 691,000
MASSACHUSETTS IFA
(Prevention of Cruelty to Animals)
Series '97 VRDN (a)
300 8/01/27 3.65 300,000
MASSACHUSETTS IFA
(Showa Womens Institute, Inc.)
Series '94 VRDN (a)
900 3/15/04 3.70 900,000
MASSACHUSETTS IFA
(Tamasi Family Development)
VRDN (a)
1,000 5/01/13 3.55 1,000,000
MASSACHUSETTS IFA
(Techprint Issue)
Series '97 AMT VRDN (a)
872 6/01/17 3.70 872,000
MASSACHUSETTS IFA
Res. Rec. (Ogden Haverhill Project)
Series '92 VRDN (a)
800 12/01/06 3.40 800,000
MASSACHUSETTS IFA PCR
(Holyoke Water & Power Co.)
Series '90 AMT VRDN (a)
1,300 12/01/20 3.30 1,300,000
MASSACHUSETTS IFA PCR
(New England Power Co.)
Series '92 VRDN (a)
500 10/01/22 3.75 500,000
SOUTH HADLEY GO
Series '97 MBIA
200 7/15/98 3.93 200,192
WESTFORD GO
Series '98 FGIC
630 5/15/99 3.85 642,531
------------
21,030,295
COLORADO-3.9%
COLORADO STUDENT OBLIGATION
BOND AUTHORITY
Student Loan Revenue
Series '89A AMT VRDN (a)
1,100 3/01/24 3.50 1,100,000
OHIO-3.6%
OHIO AIR QUALITY
DEVELOPMENT AUTHORITY PCR
(JMG Funding Partnership)
Series '94B AMT VRDN (a)
1,000 4/01/28 3.65 1,000,000
OREGON-3.6%
OREGON ECONOMIC
DEVELOPMENT AUTHORITY IDR
(Eagle-Picher Industries)
VRDN (a)
1,000 12/01/04 3.70 1,000,000
PUERTO RICO-10.4%
PUERTO RICO GOVERNMENT
DEVELOPMENT BANK
Series '85 MBIA VRDN (a)
1,300 12/01/15 3.15 1,300,000
PUERTO RICO HIGHWAY &
TRANSPORTATION AUTHORITY
Series '98A AMBAC VRDN (a)
1,300 7/01/28 3.00 1,300,000
PUERTO RICO INDUSTRIAL,
MEDICAL, HIGHER
EDUCATION & ENVIRONMENT
(Ana G. Mendez Educ.
Foundation Project) VRDN (a)
300 12/01/15 3.65 300,000
------------
2,900,000
2
ALLIANCE MUNICIPAL TRUST - MASSACHUSETTS PORTFOLIO
_______________________________________________________________________________
PRINCIPAL
AMOUNT
(000) SECURITY# YIELD VALUE
- -------------------------------------------------------------------------
SOUTH CAROLINA-3.6%
BERKELEY COUNTY IDA
(Nucor Corp. Project)
Series '95 AMT VRDN (a)
$ 1,000 9/01/28 3.65% $ 1,000,000
VIRGINIA-2.2%
PENINSULA PORTS AUTHORITY
(Dominion Terminal Project)
Series '87D VRDN (a)
600 7/01/16 3.85 600,000
TOTAL INVESTMENTS-102.9%
(amortized cost $28,630,295) $28,630,295
Other assets less liabilities-(2.9%) (797,895)
NET ASSETS-100%
(offering and redemption
price of $1.00 per share;
27,832,400 shares outstanding) $27,832,400
# All securities either mature or their interest rate changes in one year or
less.
(a) Variable Rate Demand Notes (VRDN) are instruments whose interest rates
change on a specified date (such as coupon date or interest payment date) or
whose interest rates vary with changes in a designated base rate (such as the
prime interest rate). These instruments are payable on demand and are secured
by letters of credit or other credit support agreements from major banks.
Periodic Put Bonds (PPB) are payable on demand quarterly, semi-annually or
annually and their interest rates change less frequently than rates on Variable
Rate Demand Notes.
Glossary of Terms:
AMBAC American Municipal Bond Assurance Corporation
AMT Alternative Minimum Tax
BAN Bond Anticipation Note
FGIC Financial Guaranty Insurance Company
FSA Financial Security Assurance
GO General Obligation
IDA Industrial Development Authority
IDR Industrial Development Revenue
IFA Industrial Finance Authority
MBIA Municipal Bond Investors Assurance
PCR Pollution Control Revenue
See notes to financial statements.
3
STATEMENT OF OPERATIONS
YEAR ENDED JUNE 30, 1998
ALLIANCE MUNICIPAL TRUST - MASSACHUSETTS PORTFOLIO
_______________________________________________________________________________
INVESTMENT INCOME
Interest $922,958
EXPENSES
Advisory fee (Note B) $ 126,476
Distribution assistance and
administrative service (Note C) 125,462
Custodian fees 39,458
Audit and legal fees 22,024
Transfer agency (Note B) 14,905
Printing 9,620
Registration fees 4,369
Trustees' fees 2,494
Amortization of organization expense 1,831
Miscellaneous 1,120
Total expenses 347,759
Less: expense reimbursement and fee waiver (132,094)
Net expenses 215,665
NET INCREASE IN NET ASSETS FROM OPERATIONS $707,293
STATEMENT OF CHANGES IN NET ASSETS
_______________________________________________________________________________
APRIL 17,
YEAR ENDED 1997(A) TO
JUNE 30,1998 JUNE 30,1997
------------ ------------
INCREASE IN NET ASSETS FROM OPERATIONS
Net investment income $ 707,293 $ 60,735
DIVIDENDS TO SHAREHOLDERS FROM:
Net investment income (707,293) (60,735)
TRANSACTIONS IN SHARES OF BENEFICIAL INTEREST
Net increase (Note E) 12,786,301 15,046,099
Total increase 12,786,301 15,046,099
NET ASSETS
Beginning of period 15,046,099 -0-
End of period $27,832,400 $15,046,099
(a) Commencement of operations.
See notes to financial statements.
4
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 1998
ALLIANCE MUNICIPAL TRUST - MASSACHUSETTS PORTFOLIO
_______________________________________________________________________________
NOTE A: SIGNIFICANT ACCOUNTING POLICIES
Alliance Municipal Trust (the "Fund") is registered under the Investment
Company Act of 1940 as an open-end investment company. The Fund operates as a
series company currently consisting of: Alliance Municipal Trust-General
Portfolio, Alliance Municipal Trust-New York Portfolio, Alliance Municipal
Trust-California Portfolio, Alliance Municipal Trust-Connecticut Portfolio,
Alliance Municipal Trust-New Jersey Portfolio, Alliance Municipal
Trust-Virginia Portfolio, Alliance Municipal Trust-Florida Portfolio and
Alliance Municipal Trust-Massachusetts Portfolio (the "Portfolio"). Each series
is considered to be a separate entity for financial reporting and tax purposes.
The Portfolio pursues its objectives by maintaining a portfolio of high-quality
money market securities all of which, at the time of investment, have remaining
maturities of 397 days or less. The financial statements have been prepared in
conformity with generally accepted accounting principles which require
management to make certain estimates and assumptions that affect the reported
amounts of assets and liabilities in the financial statements and amounts of
income and expenses during the reporting period. Actual results could differ
from those estimates. The following is a summary of significant accounting
policies followed by the Portfolio.
1. VALUATION OF SECURITIES
Securities in which the Portfolio invests are traded primarily in the
over-the-counter market and are valued at amortized cost, under which method a
portfolio instrument is valued at cost and any premium or discount is amortized
on a constant basis to maturity. Amortization of premium is charged to income.
Accretion of market discount is credited to unrealized gains.
2. ORGANIZATION EXPENSES
The organization expenses of the Portfolio are being amortized against income
on a straight-line basis through July, 2002.
3. TAXES
It is the Portfolio's policy to meet the requirements of the Internal Revenue
Code applicable to regulated investment companies and to distribute all of its
investment company taxable income and net realized gains, if any, to its
shareholders. Therefore, no provisions for federal income or excise taxes are
required.
4. DIVIDENDS
The Portfolio declares dividends daily from net investment income and
automatically reinvests such dividends in additional shares at net asset value.
Net realized capital gains on investments, if any, are expected to be
distributed near year end. Dividends paid from net investment income for the
year ended June 30, 1998, are exempt from federal income taxes. However,
certain shareholders may be subject to the alternative minimum tax.
5. INVESTMENT INCOME AND INVESTMENT TRANSACTIONS
Interest income is accrued as earned. Investment transactions are recorded on a
trade date basis. Realized gain (loss) from investment transactions is recorded
on the identified cost basis.
NOTE B: ADVISORY FEE AND TRANSACTIONS WITH AN AFFILIATE OF THE ADVISER
The Portfolio pays its Adviser, Alliance Capital Management L.P., an advisory
fee at the annual rate of .50% on the first $1.25 billion of average daily net
assets; .49% on the next $.25 billion; .48% on the next $.25 billion; .47% on
the next $.25 billion; .46% on the next $1 billion; and .45% in excess of $3
billion. The Adviser has agreed, pursuant to the advisory agreement, to
reimburse the Portfolio to the extent that its annual aggregate expenses
(excluding taxes, brokerage, interest and, where permitted, extraordinary
expenses) exceed 1% of its average daily net assets for any fiscal year. The
Adviser also voluntarily agreed to reimburse the Portfolio from July 1, 1997 to
August 31, 1997 for expenses exceeding .50% of its average daily net assets
from September 1, 1997 to September 30, 1997 for expenses exceeding .60% of its
average daily net assets, from October 1, 1997 to October 26, 1997 for expenses
exceeding .70% of its average daily net assets, from October 27, 1997 to
November 19, 1997 for expenses exceeding .80% of its average daily net assets
and from November 20, 1997 to January 5, 1998 for expenses exceeding .90% of
its average daily net assets. For the year ended June 30, 1998, the
reimbursement amounted to $105,068.
5
NOTES TO FINANCIAL STATEMENTS(CONTINUED)
ALLIANCE MUNICIPAL TRUST - MASSACHUSETTS PORTFOLIO
_______________________________________________________________________________
The Portfolio compensates Alliance Fund Services, Inc., a wholly-owned
subsidiary of the Adviser, under a Transfer Agency Agreement for providing
personnel and facilities to perform transfer agency services for the Portfolio.
Such compensation amounted to $13,500 for the year ended June 30, 1998.
NOTE C: DISTRIBUTION ASSISTANCE AND ADMINISTRATIVE SERVICES PLAN
Under this Plan, the Portfolio pays the Adviser a distribution fee at the
annual rate of up to .25% of the average daily value of the Portfolio's net
assets. The Plan provides that the Adviser will use such payments in their
entirety for distribution assistance and promotional activities. For the year
ended June 30, 1998, the distribution fee amounted to $63,238, of which $27,026
was waived. In addition, the Portfolio may reimburse certain broker-dealers for
administrative costs incurred in connection with providing shareholder
services, and may reimburse the Adviser for accounting and bookkeeping, and
legal and compliance support. For the year ended June 30, 1998, such payments
by the Portfolio amounted to $62,224, of which $46,000 was paid to the Adviser.
NOTE D: INVESTMENT TRANSACTIONS
At June 30, 1998, the cost of investments for federal income tax purposes was
the same as the cost for financial reporting purposes.
NOTE E: TRANSACTIONS IN SHARES OF BENEFICIAL INTEREST
An unlimited number of shares ($.01 par value) are authorized. At June 30,
1998, capital paid-in aggregated $27,832,400. Transactions, all at $1.00 per
share, were as follows:
YEAR ENDED APRIL 17,1997(A)
JUNE 30, THROUGH
1998 JUNE 30,1997
------------- ----------------
Shares sold 134,199,946 25,831,508
Shares issued on reinvestments of dividends 707,293 60,735
Shares redeemed (122,120,938) (10,846,144)
Net increase 12,786,301 15,046,099
(a) Commencement of operations.
6
FINANCIAL HIGHLIGHTS
ALLIANCE MUNICIPAL TRUST - MASSACHUSETTS PORTFOLIO
_______________________________________________________________________________
SELECTED DATA FOR A SHARE OF BENEFICIAL INTEREST OUTSTANDING THROUGHOUT EACH
PERIOD
YEAR ENDED APRIL 17,1997(A)
JUNE 30, THROUGH
1998 JUNE 30, 1997
--------- ----------------
Net asset value, beginning of period $1.00 $1.00
INCOME FROM INVESTMENT OPERATIONS
Net investment income (b) .028 .007
LESS: DIVIDENDS
Dividends from net investment income (.028) (.007)
Net asset value, end of period $1.00 $1.00
TOTAL RETURN
Total investment return based on
net asset value (c) 2.83% 3.53%(d)
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000's omitted) $27,832 $15,046
Ratios to average net assets of:
Expenses, net of waivers and reimbursements .85% .50%(d)
Expenses, before waivers and reimbursements 1.37% 2.99%(d)
Net investment income (b) 2.80% 3.47%(d)
(a) Commencement of operations.
(b) Net of expenses reimbursed or waived by the Adviser.
(c) Total investment return is calculated assuming an initial investment made
at the net asset value at the beginning of the period, reinvestment of all
dividends and distributions at net asset value during the period, and
redemption on the last day of the period.
(d) Annualized.
7
INDEPENDENT AUDITOR'S REPORT
ALLIANCE MUNICIPAL TRUST - MASSACHUSETTS PORTFOLIO
_______________________________________________________________________________
TO THE BOARD OF TRUSTEES AND SHAREHOLDERS
ALLIANCE MUNICIPAL TRUST - MASSACHUSETTS PORTFOLIO
We have audited the accompanying statement of net assets of the Massachusetts
Portfolio of Alliance Municipal Trust as of June 30, 1998 and the related
statements of operations, changes in net assets, and financial highlights for
the periods indicated in the accompanying financial statements. These financial
statements and financial highlights are the responsibility of the Portfolio's
management. Our responsibility is to express an opinion on these financial
statements and financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of June
30, 1998, by correspondence with the custodian and brokers.
An audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of the
Massachusetts Portfolio of Alliance Municipal Trust as of June 30, 1998, and
the results of its operations, changes in its net assets, and its financial
highlights for the periods indicated, in conformity with generally accepted
accounting principles.
McGladrey & Pullen, LLP
New York, New York
July 24, 1998
8
ALLIANCE MUNICIPAL TRUST - MASSACHUSETTS PORTFOLIO
1345 Avenue of the Americas, New York, NY 10105
Toll free 1 (800) 221-5672
YIELDS. For current recorded yield information on Alliance
Municipal Trust, call on a touch-tone telephone toll-free
(800) 251-0539 and press the following sequence of keys:
1 # 1 # 1 5 #
For non-touch-tone telephones, call toll-free (800) 221-9513
ALLIANCE CAPITAL
DISTRIBUTION OF THIS REPORT OTHER THAN TO SHAREHOLDERS MUST
BE PRECEDED OR ACCOMPANIED BY THE FUND'S CURRENT PROSPECTUS,
WHICH CONTAINS FURTHER INFORMATION ABOUT THE FUND.
R THESE REGISTERED SERVICE MARKS USED UNDER LICENSE FROM
THE OWNER, ALLIANCE CAPITAL MANAGEMENT L.P.
AMAAR
