The Board of Trustees and Shareholders
Putnam California Tax Exempt Income Fund
In planning and performing our audit of the financial
statements of Putnam California Tax Exempt Income Fund for the
year ended September 30, 2000, we considered its internal
control, including control activities for safeguarding
securities, in order to determine our auditing procedures for
the purpose of expressing our opinion on the financial
statements and to comply with the requirements of Form N-SAR,
not to provide assurance on internal control.
The management of Putnam California Tax Exempt Income Fund is
responsible for establishing and maintaining internal control.
In fulfilling this responsibility, estimates and judgments by
management are required to assess the expected benefits and
related costs of controls. Generally, controls that are
relevant to an audit pertain to the entity's objective of
preparing financial statements for external purposes that are
fairly presented in conformity with accounting principles
generally accepted in the United States of America. Those
controls include the safeguarding of assets against
unauthorized acquisition, use, or disposition.
Because of inherent limitations in internal control, errors or
fraud may occur and not be detected. Also, projection of any
evaluation of internal control to future periods is subject to
the risk that it may become inadequate because of changes in
conditions or that the effectiveness of the design and
operation may deteriorate.
Our consideration of internal control would not necessarily
disclose all matters in internal control that might be
material weaknesses under standards established by the
American Institute of Certified Public Accountants. A
material weakness is a condition in which the design or
operation of one or more of the internal control components
does not reduce to a relatively low level the risk that
misstatements caused by error or fraud in amounts that would
be material in relation to the financial statements being
audited may occur and not be detected within a timely period
by employees in the normal course of performing their assigned
functions. However, we noted no matters involving internal
control and its operation, including controls for safeguarding
securities, which we consider to be material weaknesses as
defined above as of September 30, 2000.
This report is intended solely for the information and use of
management, the Board of Trustees of Putnam California Tax
Exempt Income Fund, and the Securities and Exchange Commission
and is not intended to be and should not be used by anyone
other than these specified parties.
Boston, Massachusetts
November 6, 2000
