<PAGE>
F O R T A X - E X E M P T I N C O M E
Delaware Tax-Free Idaho Fund
Delaware Tax-Free Iowa Fund
Delaware Tax-Free Kansas Fund
Delaware Tax-Free Missouri Insured Fund
Delaware Tax-Free North Dakota Fund
Delaware Tax-Free Oregon Insured Fund
Delaware Tax-Free Wisconsin Fund
service and guidance
professional management
1999
Annual Report
goals
(various photos demonstrating service and
guidance, professional management and goals)
DELAWARE(SM)
INVESTMENTS
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Philadelphia [ ] London
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A T R A D I T I O N OF S O U N D I N V E S T I N G
commitment
A Commitment
To Our Investors
Delaware Investments has a tradition of money management that dates back to
1929. We have a long and distinguished history of helping individuals and
institutions--including some of America's largest pension funds--reach their
financial goals.
Headquartered in Philadelphia, a block from the nation's oldest stock
exchange, the Delaware organization established its first mutual fund in 1938.
Delaware International Advisers Ltd., our international affiliate, was
established in 1990 and is headquartered in London.
Delaware Investments offers a full range of mutual funds. We also manage
investments for variable annuities and closed-end funds as well as offer a wide
range of retirement plan services for individuals and businesses.
Delaware Investments manages approximately $47 billion in mutual fund assets
and institutional advisory accounts for more than half-a-million investors.
Complete information on any fund offered by Delaware Investments can be found in
each fund's current prospectus. Prospectuses for all funds offered by Delaware
Investments are available from your financial adviser. Please read the
prospectus carefully before you invest or send money.
Fund Objectives
Each Tax-Free Fund and Insured Fund seeks as high a level of current income
exempt from federal income tax and from the personal income tax, if any, of a
Fund's particular state, as is consistent with preservation of capital.
Table of Contents
LETTER TO SHAREHOLDERS Page 1
PORTFOLIO MANAGER'S REVIEW Page 4
DELAWARE TAX-FREE IDAHO FUND Page 5
DELAWARE TAX-FREE IOWA FUND Page 5
DELAWARE TAX-FREE KANSAS FUND Page 6
DELAWARE TAX-FREE
MISSOURI INSURED FUND Page 6
DELAWARE TAX-FREE
NORTH DAKOTA FUND Page 7
DELAWARE TAX-FREE
OREGON INSURED FUND Page 7
DELAWARE TAX-FREE
WISCONSIN FUND Page 8
PERFORMANCE SUMMARY Page 10
STATEMENTS OF NET ASSETS Page 17
FINANCIAL HIGHLIGHTS Page 36
tax-exempt
income
tradition
[photo of computer keyboard]
[photo of illustration for Tax-Exempt income]
<PAGE>
for tax-exempt
income
1
September 7, 1999
Dear Shareholder:
FISCAL 1999 WAS A CHALLENGING YEAR for both taxable and tax exempt fixed income
investors.
Just before our fiscal year began in August, debt problems in Russia and
Brazil, along with ongoing concerns about recessions in Asia, created strong
worldwide demand for U.S. Treasury bonds. Demand for Treasuries, during times of
extreme market turbulence is often referred to as "a flight to quality."
Throughout the fall, slower corporate earnings growth also fueled demand for
the relative safety of U.S. government debt. Prices for long-term Treasury bonds
rose sharply, pushing yields to historic lows. As prices for U.S. Treasury bonds
moved higher, municipal bonds seemed to offer exceptional value as compared to
Treasuries. Last fall, as Treasury yields were plummeting, an abundant supply of
municipal bonds was met with relatively stable demand.
As winter approached, three Federal Reserve interest rate cuts helped to
restore investors' confidence in the U.S. economy and reduce concerns over
global recession. This set the stage for the significant stock market recovery
that started in the fourth quarter of 1998 and continued through the end of our
fiscal year. In the spring of 1999, the
WE ARE PLEASED TO REPORT THAT FOR FISCAL 1999 TOTAL RETURNS AT NET ASSET VALUE
FOR ALL SEVEN OF OUR FUNDS OUTPACED THE RETURNS OF THEIR RESPECTIVE LIPPER PEER
GROUPS.
TOTAL RETURNS
- --------------------------------------------------------------------------------
One Year Ended
August 31, 1999
- --------------------------------------------------------------------------------
Delaware Tax-Free Idaho Fund A Class -0.99%
Delaware Tax-Free Iowa Fund A Class -0.26%
Delaware Tax-Free North Dakota Fund A Class -0.41%
Delaware Tax-Free Wisconsin Fund A Class -0.87%
Lipper Other State Municipal Debt Fund Average (77 funds) -2.52%
- --------------------------------------------------------------------------------
Delaware Tax-Free Kansas Fund A Class +0.35%
Lipper Kansas Municipal Debt Fund Average (13 funds) -1.95%
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Delaware Tax-Free Missouri Insured Fund A Class -0.38%
Lipper Missouri Municipal Debt Fund Average (20 funds) -3.02%
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Delaware Tax-Free Oregon Insured Fund A Class -1.67%
Lipper Oregon Municipal Debt Fund Average (25 funds) -3.00%
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Lehman Brothers Municipal Bond Index +0.55%
Lehman Brothers Insured Municipal Bond Index -0.29%
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All performance shown above is at net asset value and assumes reinvestment of
distributions. Past performance does not guarantee future results. Performance
of other Fund classes varies due to different charges and expenses. The Lipper
Averages represent peer groups of municipal mutual funds from a particular state
or many states. The unmanaged Lehman Brothers Municipal Bond Index is composed
of bonds with a variety of quality ratings from many states. You cannot invest
directly in an index. Complete performance information for all funds can be
found on pages 10 through 16.
<PAGE>
for tax-exempt
income
2
Dow Jones Industrial Average closed above both the 10,000 and 11,000 marks for
the first time.
During the spring and summer, fixed-income investments took second billing to
equities. The performance of Treasury bonds suffered through June, as strength
in the domestic economy reduced demand for "safe haven" investments. Municipal
bonds weren't such a clear value as they appeared in spring 1998 when yields on
Treasury bonds and municipal bonds were nearly identical, but tax-free bonds
remained attractive in our view compared to Treasury securities. The interest
income you receive from investing in municipal bonds is free from federal income
taxes.* In most states, interest received from securities issued by government
units within the state is also exempt from state and local taxes.
On June 30, the Federal Reserve Board raised the Fed Funds rate, its target
rate for overnight loans between banks, by a quarter of a percentage point
citing inflationary concerns. The Treasury market improved as a result, posting
solid gains into the first week of July. Even U.S. equity indexes hit new
records following the rate increase (Source: Bloomberg).
On August 24th, the Federal Reserve again raised interest rates by a quarter
of a percentage point, the second increase in less than two months, saying the
action should help avert inflation. The bank increased the main rate it
controls, the Federal funds target rate on overnight loans between banks, to
5.25% from 5.00%. The Dow Jones Industrial Average reacted favorably to the
interest rate increase, reaching an annual high of 11,326 on August 25, 1999
(Source: Bloomberg).
Municipals generally weathered the turbulence in the fixed income arena
better than Treasuries this past year. The 30-year U.S. Treasury bond yield
stood at 6.21%, while 30-year AAA-rated general obligation municipal bonds
yielded 5.52% on August 31, 1999. In essence, a 30-year AAA municipal bond
provided 89% of the income available on a comparable maturity Treasury bond,
even before being adjusted for the tax advantage (Source: Bloomberg).
Despite increasing yield levels, municipal bonds, like most fixed
instruments, did not deliver exceptional total return for the fiscal year ending
August 31. Delaware's Midwest and Northwest tax-free funds were no
exception--all seven Funds were either slightly up or slightly down for the
fiscal year. We are, however, very pleased that total returns for each of our
seven Midwest and Northwest tax-free funds outpaced the returns of their
respective Lipper peer groups.
discipline
<PAGE>
for tax-exempt
income
3
Please see the Portfolio Manager's Review for a discussion of individual fund
performance.
Looking forward, we believe taxable and tax exempt bonds may remain in the
shadow of stocks as long as economic growth and the roaring bull market
continue. However, we still believe fixed income investments play a vital role
in well-balanced portfolios. Tax-exempt municipal bonds remain especially
popular with investors with good reason. They offer a wide range of benefits,
including:
o Attractive current income free from federal, and in some cases, state and
local taxes*
o High degree of safety with regard to payment of interest and repayment of
principal
o Relatively dependable income potential
o Wide range of choices to fit in with your investment objectives with regard
to investment quality, maturity, type of bond and geographical location.
In the pages that follow, your Fund's portfolio manager, Elizabeth H. Howell,
reviews the positioning of our municipal bond funds and provides an outlook for
the remainder of the year.
We thank you for your patience during a difficult year for fixed income
investors. We also appreciate your continued confidence in Delaware Investments.
Sincerely,
WAYNE A. STORK
- ------------------------------
/s/Wayne A. Stork
Chairman, Delaware Investments
Family of Funds
DAVID K. DOWNES
- ------------------------------
/s/David K. Downes
President and Chief Executive Officer
Delaware Investments Family of Funds
* A portion of the income from tax-exempt funds may be subject to the
alternative minimum tax (AMT). The AMT is a federal tax, revamped by the U.S.
Tax Reform Act of 1986, aimed at ensuring that wealthy individuals and
corporations pay at least some income tax.
<PAGE>
for tax-exempt
income
4
Portfolio Manager's Review
By Elizabeth H. Howell
Vice President/Senior Portfolio Manager
September 7, 1999
OVERVIEW
IN LATE SUMMER AND FALL OF 1998, state and local governments issued municipal
bonds at near-record levels, led by education, transportation and health care
issues. New U.S. municipal bond issuance reached $285 billion in 1998, second
only to the record $292 billion sold in 1993 (Source: The Bond Buyer).
This provided us with ample opportunities to select bonds with solid credit
ratings, high current income potential and the possibility of price
appreciation. The large municipal bond supply, however, slightly exceeded
investor demand, which temporarily stifled price gains. This led to
disappointing returns in early 1999.
New bond issuance cooled off considerably over the first three months of
1999. However, supply picked back up again in March and was sustained throughout
the summer.
Prices of most fixed income securities declined this past year as the stock
market grabbed all major attention. Municipal bonds were no exception. Despite a
difficult year, the municipal bond market began gaining luster late in the
summer as the yield gap between municipal bonds and Treasury securities
narrowed.
Less than two weeks after the Federal Reserve raised its Federal funds target
rate a second time on August 24 (by 0.25%), high-quality municipal bonds were
still looking extraordinarily attractive relative to Treasury bonds, in our
view. As of August 31, 1999, investors were giving up very little yield in
return for freedom from certain taxes.
A couple of factors that we believe are at play in the improving municipal
market:
o Treasury bond supply has been steadily tapering off this past spring and
summer, making them relatively more expensive compared to municipal bonds. For
nearly two decades, the government securities market has grown exponentially.
The government relied upon Treasuries to help it finance the nation's $5.5
trillion in debt. Now, with a back-to-back budget surplus occurring for the
first time since 1956 and 1957, Treasury bonds are becoming relatively scarce
(Source: Bloomberg).
o Moreover, a robust U.S. economy has improved the credit quality of many
overview
DESPITE A DIFFICULT YEAR, THE MUNICIPAL BOND MARKET BEGAN GAINING LUSTER LATE IN
THE SUMMER AS THE YIELD GAP BETWEEN MUNICIPALS AND TREASURY SECURITIES NARROWED.
<PAGE>
for tax-exempt
income
5
(photo of family on beach)
municipal bond jurisdictions, so default risk for high-quality muni bonds is
relatively low.
In our view, the single biggest factor weighing down municipal bonds now is
the bull market in stocks. Against annual double-digit gains in the stock
market, the yield on municipal bonds tends to look undersized.
DELAWARE TAX-FREE IDAHO FUND
Delaware Tax-Free Idaho Fund had a total return of -0.99% (for Class A shares at
net asset value with distributions reinvested) for the year ended August 31,
1999. Despite a slightly negative return, your Fund preserved principal to a
greater degree than the Fund's peer group, the Lipper Other States Municipal
Debt Fund category, which had an average annual return of -2.52%.
As of August 31, 1999, Tax-Free Idaho Fund's duration, which measures a
fund's sensitivity to interest rate changes, was 8.7 years, longer than the
duration of the Lipper Other States Municipal Debt Fund average. This allowed
the Fund to benefit as lower interest rates increased the attractiveness of
higher yielding long-term bonds.
Delaware Tax-Free Idaho Fund maintained a well-diversified portfolio, with a
majority of the Fund's assets allocated to high-quality investment grade issues.
We complemented the portfolio's investment grade holdings with well-researched
unrated bonds to help boost the Fund's income potential. In general, unrated
bonds offer more income than comparable rated bonds.
While Idaho's state economy is somewhat reliant on resource-based industries
(timber, agriculture and minerals), a growing demand for tourism and
manufacturing jobs has helped increase diversity. Idaho has also been able to
attract several technology and software companies over the past decade, which
has helped to create new jobs and boost personal incomes. Overall, we believe, a
strong regional economy has strengthened the financial position of many Idaho
municipalities.
DELAWARE TAX-FREE IOWA FUND
Delaware Tax-Free Iowa Fund had a total return of -0.26% (for Class A shares at
net asset value with distributions reinvested) for the one-year period ended
August 31, 1999. The return handily beat the average return of its 77 peer funds
as represented by the Lipper Other States Municipal Debt Fund category.
The average effective duration of the Fund as of August 31, 1999, was 7.8
years. Duration is a common measure of a bond or bond fund's sensitivity to
interest rates. The longer the duration, the more the bond's price will change
for a given increase or decrease in interest rates.
Historically, Iowa municipalities have issued relatively few bonds that are
exempt from both federal and state taxes. Nevertheless, all of the bonds held by
your Fund provide Iowa residents with a dual tax exemption. Some investors
subject to
tax-free
iowa
<PAGE>
for tax-exempt
income
6
(photo of computer keyboard)
the federal alternative minimum tax may not benefit completely from
this strategy.
Over the past few years, increased revenue from legalized gambling has
bolstered Iowa's growing economy. In the coming months, we expect strong state
and national economic trends to benefit many of this state's municipalities.
DELAWARE TAX-FREE KANSAS FUND
Delaware Tax-Free Kansas Fund provided a +0.35% total return (for Class A shares
at net asset value with distributions reinvested) as of August 31, 1999. This
beat the return of the Lipper Kansas Municipal Debt Fund Average (composed of 13
funds), which delivered a -1.95% total return.
The economy in Kansas, like the majority of other mid-western state economies
is healthy and growing. Falling overseas demand for wheat and declining
commodity prices may, however, begin to put pressure on the state's farming
industry in the coming year. In our opinion, with budgets in excellent shape and
tax revenues rising at both the state and local level, this scenario shouldn't
adversely affect the financial situations of Kansas municipalities in the coming
fiscal year.
DELAWARE TAX-FREE MISSOURI INSURED FUND
Your Fund returned -0.38% for the year ended August 31, 1999 (for Class A shares
at net asset value with distributions reinvested). We preserved principal better
than the average total return of other Missouri municipal bonds funds as tracked
by the Lipper Missouri Municipal Debt Fund Average.
Delaware Tax-Free Missouri Insured Fund invested exclusively in insured bonds
rated AAA by Standard and Poor's. This is the highest bond credit rating
available.
Increased housing and commercial development activity is promoting relatively
rapid growth in Missouri cities, especially St. Louis and Kansas City. We expect
this growth to increase tax revenues, which would in turn strengthen the credit
quality of Missouri's municipalities.
tax-free
kansas
<TABLE>
<CAPTION>
PORTFOLIO HIGHLIGHTS
TAX-FREE FUNDS
- --------------------------------------------------------------------------------------------------------
AUGUST 31, 1999
Idaho Iowa Kansas Missouri Insured
- --------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Average Credit Quality A1 AA AA3 AAA
Average Duration 8.7 years 7.8 years 7.1 years 6.3 years
Average Effective Maturity* 14.3 years 11.5 years 11.7 years 8.2 years
Average Maturity** 18.3 years 17.8 years 19.1 years 17.5 years
Alternative Minimum Tax*** 11.22% 5.11% 20.00% 17.94%
- --------------------------------------------------------------------------------------------------------
Before Expense Before Expense Before Expense Before Expense
Current 30-Day SEC Yield+ Limitation Limitation Limitation Limitation
(Class A) 4.40% 4.39% 4.17% 3.99% 4.29% 4.05% 4.03% 4.03%
(Class B) 3.83% 3.82% 3.58% 3.40% 3.69% 3.45% 3.44% 3.44%
(Class C) 3.83% 3.82% 3.58% 3.40% 3.70% 3.46% 3.43% 3.43%
- ---------------------------------------------------------------------------------------------------------
</TABLE>
* Average effective maturity takes into consideration all prepayments, puts
and adjustable coupons.
** Average maturity is the stated maturity on the bond and does not take into
account any prepayments.
*** Percentage of income generated for the year ended August 31, 1999 that was
subject to the federal alternative minimum tax.
+ Calculated according to Securities and Exchange Commission guidelines. An
expense limitation for each Fund was in effect for the period shown. Yields
would have been lower without the limitation.
<PAGE>
for tax-exempt
income
7
DELAWARE TAX-FREE NORTH DAKOTA FUND
For the year ended August 31, 1999, Delaware Tax-Free North Dakota Fund provided
a slightly negative return of -0.41% (for Class A shares at net asset value with
distributions reinvested). Although this return was negative, it compared
favorably with the -2.52% return of the Fund's peers.
Over the last year, we continued to position the Fund to perform well in a
declining interest rate environment. The Fund's average effective duration was
7.1 years. This helped us to protect capital relative to many of the Fund's
peers and achieve a higher rate of total return as interest rates fell last
fall.
Rebuilding projects in metropolitan areas such as Fargo and Grand Forks
following the 1997 Red River Valley floods created employment opportunities and
helped to boost local economies. Yet unlike most other mid-western states, North
Dakota's municipalities have not been able to accumulate significant budget
surpluses over the last several years. In the coming months, we will continue to
monitor the fiscal health of North Dakota's municipalities to ensure acceptable
credit quality for all of Delaware Tax-Free North Dakota Fund's holdings.
DELAWARE TAX-FREE OREGON INSURED FUND
Delaware Tax-Free Oregon Insured Fund provided a total return of -1.67% for the
year ended August 31, 1999 (for Class A shares at net asset value with
distributions reinvested). This return compared favorably to the -3.00% average
total return for all other Oregon municipal bond funds tracked by Lipper
Analytical Services.
Delaware Tax-Free Oregon Insured Fund invested exclusively in bonds with AAA
ratings from Standard & Poor's. The majority of the bonds in the Fund's
portfolio are protected by municipal bond insurance, which guarantees the timely
payment of principal and interest. This
REGARDLESS OF MARKET CONDITIONS, MUNICIPAL BOND FUNDS HAVE THE POTENTIAL TO
OFFER VALUABLE ASSET ALLOCATION BENEFITS WITHOUT ADDING TO TAXABLE INVESTMENT
INCOME.
tax-free
oregon
insured
PORTFOLIO HIGHLIGHTS
TAX-FREE FUNDS
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AUGUST 31, 1999
North Dakota Oregon Insured Wisconsin
- --------------------------------------------------------------------------------
Average Credit Quality AA3 AAA AA3
Average Duration 7.1 years 8.2 years 8.3 years
Average Effective Maturity* 11.2 years 11.5 years 12.0 years
Average Maturity** 18.2 years 18.0 years 21.0 years
Alternative Minimum Tax*** 14.13% 9.46% 21.04%
- --------------------------------------------------------------------------------
Before Expense Before Expense Before Expense
Current 30-Day SEC Yield+ Limitation Limitation Limitation
(Class A) 5.00% -- 4.63% 4.48% 4.38% 4.31%
(Class B) 4.44% -- 4.05% 3.90% 3.80% 3.73%
(Class C) 4.45% -- 4.05% 3.89% 3.78% 3.71%
- --------------------------------------------------------------------------------
* Average effective maturity takes into consideration all prepayments, puts
and adjustable coupons.
** Average maturity is the stated maturity on the bond and does not take into
account any prepayments.
*** Percentage of income generated for the year ended August 31, 1999 that was
subject to the federal alternative minimum tax.
+ Calculated according to Securities and Exchange Commission guidelines. An
expense limitation for each Fund was in effect for the period shown. Yields
would have been lower without the limitation.
<PAGE>
for tax-exempt
income
8
does not, however, guarantee against price volatility.
The Oregon economy continues to demonstrate economic development and
diversification. The Asian recession slowed economic growth in Oregon throughout
1998, but the state largely recovered in 1999, along with the rest of the
Northwest. In our opinion, the finances of most Oregon municipalities remain
strong and should support the credit quality of the Fund's holdings.
DELAWARE TAX-FREE
WISCONSIN FUND
Delaware Tax-Free Wisconsin Fund had a total return of -0.87% (for Class A
shares at net asset value with distributions reinvested) for the year ended
August 31, 1999. This return compared favorably to the -2.52% average total
return of other funds tracked by the Lipper Other States Municipal Debt Fund
category.
Most of the bonds issued by Wisconsin municipalities are not exempt from
state income tax. We always seek to purchase those relatively rare Wisconsin
issues that offered dual exemption from both state and federal income tax. We
supplemented these holdings with territorial bonds issued by Puerto Rico and the
Virgin Islands. These bonds not only offered dual exemption potential, but also
provided an element of diversification for the Fund.
The Wisconsin economy continues to benefit from over eight years of economic
expansion at the national level. We believe this points to a positive credit
outlook for the state's municipalities for the remainder of 1999.
OUTLOOK
The U.S. seems to be the engine of growth for the entire world at this time. We
believe strong forward momentum for the U.S. economy is likely to result in
solid growth (about 3% annually) for the remainder of this year.
We also believe that the Federal Reserve's two 0.25% interest rate increases
on June 30 and August 24 represented fine-tuning rather than fundamental changes
in policy. Both actions were made by the central bank in an attempt to avert
inflation.
(photo of couple talking to financial planner)
tax-free
wisconsin
<PAGE>
for tax-exempt
income
9
Having now taken back two of last fall's three rate cuts, the Fed did leave
open the possibility that it could raise rates a third time this year. We
believe they would do so if economic data showed inflationary pressure in the
form of further big wage increases or a substantial rise in the Consumer Price
Index, an index that tracks U.S. inflationary levels in percentage points.
In the coming year, we think that municipal bond prices have the potential to
rise. Because municipals are generally not subject to the ebb and flow of
foreign demand, like Treasuries, they have been far more stable the last two
years. According to Bloomberg, over the two years ended August 31, the price of
10-year Treasuries were three times as volatile as municipal bond prices based
on standard deviation. We believe more investors will flock to municipal bonds
in the months ahead and drive up demand.
If prices rise, state municipal bond mutual funds, such as any of our seven
Delaware Midwest and Northwest tax-free funds, have the potential to rise in
value. We see the possibility of capital appreciation considering that municipal
prices would have to rise significantly so that they yield approximately 84% of
what Treasuries yield. Historically, this has been the relationship between
Treasuries and municipal bonds (Source: Bloomberg).
If U.S. economic growth slows modestly for the remainder of 1999, the Federal
Reserve will be less likely to raise short-term rates. Bonds will breathe a sigh
of relief and long-term interest rates will most likely fall. Municipal bonds,
at their reasonable current prices, should offer investors excellent value in
the remainder of 1999.
Regardless of market conditions, municipal bond funds have the potential to
offer valuable asset allocation benefits without adding to taxable investment
income. In our view, investors seeking to diversify their portfolios with less
volatile investments will find attractive opportunities in municipal bonds and
municipal bond funds.
REGARDLESS OF MARKET CONDITIONS, MUNICIPAL BOND FUNDS HAVE THE POTENTIAL TO
OFFER VALUABLE ASSET ALLOCATION BENEFITS WITHOUT ADDING TO TAXABLE INVESTMENT
INCOME.
outlook
<PAGE>
for tax-exempt
income
10
Performance Summary
TAX-FREE IDAHO FUND'S
LIFETIME PERFORMANCE
- --------------------------------------------------------------------------------
GROWTH OF A $10,000 INVESTMENT
JANUARY 4, 1995 TO AUGUST 31, 1999
<TABLE>
<CAPTION>
Lipper Other
States Municipal
Debt Fund Average Lehman Brothers Delaware Tax-Free
(59 funds) Municipal Bond Index Idaho Fund A Class
----------------- -------------------- ------------------
<S> <C> <C> <C>
Jan. `95 $10,000 $ 9,625 $10,000
Feb. `96 $10,291 $10,168 $ 9,979
Aug. `96 $10,897 $10,676 $ 9,988
Feb. `97 $11,428 $11,305 $10,451
Aug. `97 $11,468 $11,314 $10,820
Feb. `98 $12,057 $11,910 $11,306
Aug. `98 $12,528 $12,436 $11,643
Feb. `99 $13,159 $13,118 $11,848
Aug. `99 $13,612 $13,560 $11,543
</TABLE>
Chart assumes a $10,000 investment on January 4, 1995, and includes the effect
of a 3.75% front-end sales charge and the reinvestment of all distributions. The
Lipper Average represents peer groups of municipal bond mutual funds from many
states. The unmanaged Lehman Brothers Municipal Bond Index is comprised of bonds
with a variety of quality ratings from many states. You cannot invest directly
in an index. Performance for other classes will differ due to different charges
and expenses. Past performance does not guarantee future results.
DELAWARE TAX-FREE IDAHO FUND PERFORMANCE
- --------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURNS THROUGH AUGUST 31, 1999
Lifetime Three Year One Year
- --------------------------------------------------------------------------------
Class A (Est. 1/4/95)
Excluding Sales Charge +7.43% +5.86% -0.99%
Including Sales Charge +6.55% +4.54% -4.70%
- --------------------------------------------------------------------------------
Class B (Est. 3/16/95)
Excluding Sales Charge +5.59% +5.14% -1.82%
Including Sales Charge +5.22% +4.23% -5.60%
- --------------------------------------------------------------------------------
Class C (Est. 1/11/95)
Excluding Sales Charge +6.46% +5.02% -1.82%
Including Sales Charge +6.46% +5.02% -2.76%
Performance for all classes includes reinvestment of distributions and
applicable sales charge as described below. Return and share value will
fluctuate so that shares when redeemed may be worth more or less than the
original cost. Past performance is not a guarantee of future results.
Performance for Class B and C shares excluding sales charge assumes either
contingent deferred sales charges did not apply or the investment was not
redeemed.
Class A shares of each Fund have a 3.75% maximum front-end sales charge and a
12b-1 fee.
Class B shares do not carry a front-end sales charge, but are subject to a 1%
annual distribution and service fee. They are also subject to a deferred sales
charge of up to 4% if redeemed before the end of the sixth year.
Class C shares have a 1% annual distribution and service fee. If shares are
redeemed within 12 months, a 1% contingent deferred sales charge applies.
<PAGE>
for tax-exempt
income
11
TAX-FREE IOWA FUND'S
LIFETIME PERFORMANCE
- --------------------------------------------------------------------------------
GROWTH OF A $10,000 INVESTMENT
AUGUST 31, 1993 TO AUGUST 31, 1999
<TABLE>
<CAPTION>
Lipper Other
States Municipal
Debt Fund Average Lehman Brothers Delaware Tax-Free
(23 funds) Municipal Bond Index Idaho Fund A Class
----------------- -------------------- ------------------
<S> <C> <C> <C>
Sep. `93 $10,000 $10,000 $ 9,625
Aug. `94 $ 9,901 $ 9,982 $ 9,367
Aug. `95 $10,779 $10,692 $ 9,956
Aug. `96 $11,343 $11,250 $10,433
Aug. `97 $12,392 $12,173 $11,485
Aug. `98 $13,464 $13,090 $12,424
Aug. `99 $13,537 $12,999 $12,390
</TABLE>
Chart assumes a $10,000 investment on September 1, 1993, and includes the effect
of a 3.75% front-end sales charge and the reinvestment of all distributions. The
Lipper Average represents a peer group of municipal bond mutual funds from many
states. The unmanaged Lehman Brothers Municipal Bond Index is comprised of bonds
with a variety of quality ratings from many states. You cannot invest directly
in an index. Performance for other classes will differ due to different charges
and expenses. Past performance does not guarantee future results.
DELAWARE TAX-FREE IOWA FUND PERFORMANCE
- --------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURNS THROUGH AUGUST 31, 1999
Lifetime Five Years One Year
- --------------------------------------------------------------------------------
Class A (Est. 9/1/93)
Excluding Sales Charge +4.32% +5.76% -0.26%
Including Sales Charge 3.66% +4.96% -4.04%
- --------------------------------------------------------------------------------
Class B (Est. 3/24/95)
Excluding Sales Charge +5.21% -1.03%
Including Sales Charge +4.83% -4.84%
- --------------------------------------------------------------------------------
Class C (Est. 1/4/95)
Excluding Sales Charge +6.70% -1.03%
Including Sales Charge +6.70% -1.98%
Performance for all classes includes reinvestment of distributions and
applicable sales charge as described below. Return and share value will
fluctuate so that shares when redeemed may be worth more or less than the
original cost. Past performance is not a guarantee of future results.
Performance for Class B and C shares excluding sales charge assumes either
contingent deferred sales charges did not apply or the investment was not
redeemed.
Class A shares of each Fund have a 3.75% maximum front-end sales charge and a
12b-1 fee.
Class B shares do not carry a front-end sales charge, but are subject to a 1%
annual distribution and service fee. They are also subject to a deferred sales
charge of up to 4% if redeemed before the end of the sixth year.
Class C shares have a 1% annual distribution and service fee. If shares are
redeemed within 12 months, a 1% contingent deferred sales charge applies.
<PAGE>
for tax-exempt
income
12
TAX-FREE KANSAS FUND'S
LIFETIME PERFORMANCE
- --------------------------------------------------------------------------------
GROWTH OF A $10,000 INVESTMENT
NOVEMBER 30, 1992 TO AUGUST 31, 1999
<TABLE>
<CAPTION>
Lipper Kansas
Municipal
Debt Fund Average Lehman Brothers Delaware Tax-Free
(23 funds) Municipal Bond Index Kansas Fund A Class
----------------- -------------------- -------------------
<S> <C> <C> <C>
Dec. `92 $10,000 $ 9,625 $10,000
Aug. `93 $10,948 $10,766 $11,063
Aug. `94 $10,963 $10,813 $11,041
Aug. `95 $11,935 $11,571 $11,783
Aug. `96 $12,560 $12,242 $12,346
Aug. `97 $13,721 $13,316 $13,188
Aug. `98 $14,908 $14,537 $14,050
Aug. `99 $14,990 $14,587 $14,140
</TABLE>
Chart assumes a $10,000 investment on November 30, 1992, and includes the effect
of a 3.75% front-end sales charge and the reinvestment of all distributions. The
Lipper Average represents a peer group of municipal bond mutual funds from
Kansas. The unmanaged Lehman Brothers Municipal Bond Index is comprised of bonds
with a variety of quality ratings from many states. You cannot invest directly
in an index. Performance for other classes will differ due to different charges
and expenses. Past performance does not guarantee future results.
DELAWARE TAX-FREE KANSAS FUND PERFORMANCE
- --------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURNS THROUGH AUGUST 31, 1999
Lifetime Five Years One Year
- --------------------------------------------------------------------------------
Class A (Est. 11/30/92)
Excluding Sales Charge +6.37% +6.18% +0.35%
Including Sales Charge +5.77% +5.36% -3.37%
- --------------------------------------------------------------------------------
Class B (Est. 4/8/95)
Excluding Sales Charge +5.37% -0.49%
Including Sales Charge +4.98% -4.30%
- --------------------------------------------------------------------------------
Class C (Est. 4/12/95)
Excluding Sales Charge +5.33% -0.40%
Including Sales Charge +5.33% -1.35%
Performance for all classes includes reinvestment of distributions and
applicable sales charge as described below. Return and share value will
fluctuate so that shares when redeemed may be worth more or less than the
original cost. Past performance is not a guarantee of future results.
Performance for Class B and C shares excluding sales charge assumes either
contingent deferred sales charges did not apply or the investment was not
redeemed.
Class A shares of each Fund have a 3.75% maximum front-end sales charge and a
12b-1 fee.
Class B shares do not carry a front-end sales charge, but are subject to a 1%
annual distribution and service fee. They are also subject to a deferred sales
charge of up to 4% if redeemed before the end of the sixth year.
Class C shares have a 1% annual distribution and service fee. If shares are
redeemed within 12 months, a 1% contingent deferred sales charge applies.
<PAGE>
for tax-exempt
income
13
TAX-FREE MISSOURI INSURED FUND'S
LIFETIME PERFORMANCE
- --------------------------------------------------------------------------------
GROWTH OF A $10,000 INVESTMENT
NOVEMBER 2, 1992 TO AUGUST 31, 1999
<TABLE>
<CAPTION>
Lipper Missouri
Municipal
Debt Fund Average Lehman Brothers Delaware Tax-Free
(9 funds) Municipal Bond Index Missouri Fund A Class
----------------- -------------------- ---------------------
<S> <C> <C> <C>
Dec. `92 $10,000 $10,000 $ 9,625
Aug. `93 $10,948 $11,130 $10,629
Aug. `94 $10,963 $10,994 $10,455
Aug. `95 $11,935 $11,847 $11,304
Aug. `96 $12,560 $12,430 $11,941
Aug. `97 $13,721 $13,490 $13,024
Aug. `98 $14,908 $14,564 $14,082
Aug. `99 $14,990 $14,429 $14,028
</TABLE>
Chart assumes a $10,000 investment on November 2, 1992, and includes the effect
of a 3.75% front-end sales charge and the reinvestment of all distributions. The
Lipper Average represents a peer group of municipal bond mutual funds from
Missouri. The unmanaged Lehman Brothers Municipal Bond Index is comprised of
bonds with a variety of quality ratings from many states. You cannot invest
directly in an index. Performance for other classes will differ due to different
charges and expenses. Past performance does not guarantee future results.
DELAWARE TAX-FREE MISSOURI INSURED FUND PERFORMANCE
- --------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURNS THROUGH AUGUST 31, 1999
Lifetime Five Years One Year
- --------------------------------------------------------------------------------
Class A (Est. 11/2/92)
Excluding Sales Charge +5.85% +6.06% -0.38%
Including Sales Charge +5.26% +5.26% -4.09%
- --------------------------------------------------------------------------------
Class B (Est. 3/12/94)
Excluding Sales Charge +4.53% +5.38% -1.13%
Including Sales Charge +4.38% +5.05% -4.94%
- --------------------------------------------------------------------------------
Class C (Est. 11/11/95)
Excluding Sales Charge +3.98% -1.12%
Including Sales Charge +3.98% -2.07%
Performance for all classes includes reinvestment of distributions and
applicable sales charge as described below. Return and share value will
fluctuate so that shares when redeemed may be worth more or less than the
original cost. Past performance is not a guarantee of future results.
Performance for Class B and C shares excluding sales charge assumes either
contingent deferred sales charges did not apply or the investment was not
redeemed.
Class A shares of each Fund have a 3.75% maximum front-end sales charge and a
12b-1 fee.
Class B shares do not carry a front-end sales charge, but are subject to a 1%
annual distribution and service fee. They are also subject to a deferred sales
charge of up to 4% if redeemed before the end of the sixth year.
Class C shares have a 1% annual distribution and service fee. If shares are
redeemed within 12 months, a 1% contingent deferred sales charge applies.
<PAGE>
for tax-exempt
income
14
TAX-FREE NORTH DAKOTA FUND'S
LIFETIME PERFORMANCE
- --------------------------------------------------------------------------------
GROWTH OF A $10,000 INVESTMENT
APRIL 1, 1991 TO AUGUST 31, 1999
<TABLE>
<CAPTION>
Lipper Other
States Municipal
Debt Fund Average Lehman Brothers Delaware Tax-Free
(7 funds) Municipal Bond Index North Dakota Fund A Class
----------------- -------------------- -------------------------
<S> <C> <C> <C>
Apr. `91 $10,000 $ 9,625 $10,000
Aug. `91 $10,822 $10,513 $10,273
Aug. `92 $11,776 $11,532 $11,215
Aug. `93 $13,222 $12,816 $12,376
Aug. `94 $12,543 $12,115 $12,449
Aug. `95 $14,727 $14,273 $13,326
Aug. `96 $15,380 $14,828 $14,021
Aug. `97 $16,793 $16,200 $15,098
Aug. `98 $17,881 $17,114 $16,167
Aug. `99 $17,651 $16,835 $16,117
</TABLE>
Chart assumes a $10,000 investment on April 1, 1991 and includes the effect of a
3.75% front-end sales charge and the reinvestment of all distributions. The
Lipper Average represents peer a group of municipal bond mutual funds from many
states. The unmanaged Lehman Brothers Municipal Bond Index is comprised of bonds
with a variety of quality ratings from many states. You cannot invest directly
in an index. Performance for other classes will differ due to different charges
and expenses. Past performance does not guarantee future results.
TAX-FREE NORTH DAKOTA FUND'S LIFETIME PERFORMANCE
- --------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURNS THROUGH AUGUST 31, 1999
Lifetime Five Years One Year
- --------------------------------------------------------------------------------
Class A (Est. 4/1/91)
Excluding Sales Charge +6.89% +6.15% -0.41%
Including Sales Charge +6.40% +5.34% -4.18%
- --------------------------------------------------------------------------------
Class B (Est. 5/10/94)
Excluding Sales Charge +5.88% +5.54% -1.14%
Including Sales Charge +5.73% +5.21% -4.92%
- --------------------------------------------------------------------------------
Class C (Est. 7/29/95)
Excluding Sales Charge +4.95% -1.15%
Including Sales Charge +4.95% -2.10%
Performance for all classes includes reinvestment of distributions and
applicable sales charge as described below. Return and share value will
fluctuate so that shares when redeemed may be worth more or less than the
original cost. Past performance is not a guarantee of future results.
Performance for Class B and C shares excluding sales charge assumes either
contingent deferred sales charges did not apply or the investment was not
redeemed.
Class A shares of each Fund have a 3.75% maximum front-end sales charge and a
12b-1 fee.
Class B shares do not carry a front-end sales charge, but are subject to a 1%
annual distribution and service fee. They are also subject to a deferred sales
charge of up to 4% if redeemed before the end of the sixth year.
Class C shares have a 1% annual distribution and service fee. If shares are
redeemed within 12 months, a 1% contingent deferred sales charge applies.
<PAGE>
for tax-exempt
income
15
TAX-FREE OREGON INSURED FUND'S
LIFETIME PERFORMANCE
- --------------------------------------------------------------------------------
GROWTH OF A $10,000 INVESTMENT
AUGUST 1, 1993 TO AUGUST 31, 1999
<TABLE>
<CAPTION>
Lipper Oregon
Municipal
Debt Fund Average Lehman Brothers Insured Delaware Tax-Free
(10 funds) Municipal Bond Index Oregon Fund A Class
----------------- ----------------------- -------------------
<S> <C> <C> <C>
Aug. `93 $10,000 $10,000 $ 9,625
Feb. `94 $10,105 $10,127 $ 9,958
Aug. `94 $10,014 $ 9,890 $ 9,595
Feb. `95 $10,295 $10,145 $ 9,876
Aug. `95 $10,902 $10,610 $10,352
Feb. `96 $11,432 $11,086 $10,935
Aug. `96 $11,473 $11,112 $10,892
Feb. `97 $12,062 $11,609 $11,427
Aug. `97 $12,533 $12,056 $11,896
Feb. `98 $13,164 $12,615 $12,561
Aug. `98 $13,617 $13,009 $12,940
Feb. `99 $13,973 $13,276 $13,230
Aug. `99 $13,692 $12,894 $12,723
</TABLE>
Chart assumes a $10,000 investment on August 1, 1993 and includes the effect of
a 3.75% front-end sales charge and the reinvestment of all distributions. The
Lipper Average represents peer a group of municipal bond mutual funds from
Oregon. The unmanaged Lehman Brothers Municipal Bond Index is comprised of bonds
with a variety of quality ratings from many states. You cannot invest directly
in an index. Performance for other classes will differ due to different charges
and expenses. Past performance does not guarantee future results.
TAX-FREE OREGON INSURED FUND
- --------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURNS THROUGH AUGUST 31, 1999
Lifetime Five Years One Year
- --------------------------------------------------------------------------------
Class A (Est. 8/1/93)
Excluding Sales Charge +4.71% +5.81% -1.67%
Including Sales Charge +4.06% +5.00% -5.39%
- --------------------------------------------------------------------------------
Class B (Est. 3/12/94)
Excluding Sales Charge +4.27% +5.15% -2.41%
Including Sales Charge +4.12% +4.82% -6.17%
- --------------------------------------------------------------------------------
Class C (Est. 7/7/95)
Excluding Sales Charge +4.47% -2.41%
Including Sales Charge +4.47% -3.36%
Performance for all classes includes reinvestment of distributions and
applicable sales charge as described below. Return and share value will
fluctuate so that shares when redeemed may be worth more or less than the
original cost. Past performance is not a guarantee of future results.
Performance for Class B and C shares excluding sales charge assumes either
contingent deferred sales charges did not apply or the investment was not
redeemed.
Class A shares of each Fund have a 3.75% maximum front-end sales charge. Class A
Shares have a 0.25% 12b-1 fee.
Class B shares do not carry a front-end sales charge, but are subject to a 1%
annual distribution and service fee. They are also subject to a deferred sales
charge of up to 4% if redeemed before the end of the sixth year.
Class C shares have a 1% annual distribution and service fee. If shares are
redeemed within 12 months, a 1% contingent deferred sales charge applies.
<PAGE>
for tax-exempt
income
16
TAX-FREE WISCONSIN FUND'S
LIFETIME PERFORMANCE
- --------------------------------------------------------------------------------
GROWTH OF A $10,000 INVESTMENT
SEPTEMBER 1, 1993 TO AUGUST 31, 1999
<TABLE>
<CAPTION>
Lipper Other
States Municipal
Debt Fund Average Lehman Brothers Delaware Tax-Free
(23 funds) Municipal Bond Index Wisconsin Fund A Class
----------------- -------------------- ----------------------
<S> <C> <C> <C>
Sep. '93 $10,000 $10,000 $9,625
Feb. '94 $10,123 $9,991 $9,718
Aug. '94 $9,982 $9,901 $9,394
Feb. '95 $10,245 $10,179 $9,637
Aug. '95 $10,692 $10,779 $10,055
Feb. '96 $11,213 $11,303 $10,593
Aug. '96 $11,250 $11,343 $10,654
Feb. '97 $11,765 $11,926 $11,074
Aug. '97 $12,173 $12,392 $11,477
Feb. '98 $12,713 $13,016 $12,025
Aug. '98 $13,090 $13,464 $12,411
Feb. '99 $13,335 $13,816 $12,641
Aug. '99 $12,989 $13,637 $12,302
</TABLE>
Chart assumes a $10,000 investment on September 1, 1993 and includes the effect
of a 3.75% front-end sales charge and the reinvestment of all distributions. The
Lipper Average represents a peer group of municipal bond mutual funds from many
states. The unmanaged Lehman Brothers Municipal Bond Index is comprised of bonds
with a variety of quality ratings from many states. You cannot invest directly
in an index. Performance for other classes will differ due to different charges
and expenses. Past performance does not guarantee future results.
TAX-FREE WISCONSIN FUND'S PERFORMANCE
- --------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURNS THROUGH AUGUST 31, 1999
Lifetime Five Years One Year
- --------------------------------------------------------------------------------
Class A (Est. 9/1/93)
Excluding Sales Charge +4.19% +5.55% -0.87%
Including Sales Charge +3.53% +4.75% -4.56%
- --------------------------------------------------------------------------------
Class B (Est. 4/22/95)
Excluding Sales Charge +4.50% -1.60%
Including Sales Charge +4.11% -5.38%
- --------------------------------------------------------------------------------
Class C (Est. 3/28/95)
Excluding Sales Charge +4.59% -1.70%
Including Sales Charge +4.59% -2.65%
Performance for all classes includes reinvestment of distributions and
applicable sales charge as described below. Return and share value will
fluctuate so that shares when redeemed may be worth more or less than the
original cost. Past performance is not a guarantee of future results.
Performance for Class B and C shares excluding sales charge assumes either
contingent deferred sales charges did not apply or the investment was not
redeemed.
Class A shares of each Fund have a 3.75% maximum front-end sales charge. Class A
Shares have a 0.25% 12b-1 fee.
Class B shares do not carry a front-end sales charge, but are subject to a 1%
annual distribution and service fee. They are also subject to a deferred sales
charge of up to 4% if redeemed before the end of the sixth year.
Class C shares have a 1% annual distribution and service fee. If shares are
redeemed within 12 months, a 1% contingent deferred sales charge applies.
<PAGE>
for tax-exempt income 17
Financial Statements
VOYAGEUR MUTUAL FUNDS, INC. - DELAWARE TAX-FREE IDAHO FUND
STATEMENT OF NET ASSETS
AUGUST 31, 1999
- -------------------------------------------------------------------------------
PRINCIPAL MARKET
AMOUNT VALUE
------------------------
MUNICIPAL BONDS - 93.65%
GENERAL OBLIGATION BONDS - 8.78%
Ada & Canyon County School District #2 5.50%
7/30/16 .......................................... $1,055,000 $1,068,884
Bonner County Local Improvement District # 93-1
6.20% 4/30/05 .................................... 150,000 157,395
Bonner County Local Improvement District # 93-2
6.35% 4/30/06 .................................... 185,000 194,405
Bonner County Local Improvement District # 93-3
6.40% 4/30/07 .................................... 195,000 204,902
Bonner County Local Improvement District # 93-4
6.50% 4/30/08 .................................... 110,000 115,573
Bonner County Local Improvement District # 93-5
6.50% 4/30/10 .................................... 100,000 104,726
Coeur D' Alene Local Improvement District # 6
Series 1995 6.00% 7/1/09 ......................... 85,000 88,867
Coeur D' Alene Local Improvement District # 6
Series 1996 6.05% 7/1/10 ......................... 90,000 94,185
Coeur D' Alene Local Improvement District # 6
Series 1997 6.10% 7/1/12 ......................... 40,000 41,844
Coeur D' Alene Local Improvement District # 6
Series 1998 6.10% 7/1/14 ......................... 45,000 46,959
Madison County (FSA) 5.40% 8/1/14 ................... 300,000 301,791
Puerto Rico Commonwealth 5.375% 7/1/25 .............. 1,250,000 1,195,313
Puerto Rico Commonwealth Public Improvement
4.50% 7/1/23 ..................................... 1,550,000 1,286,205
Sun Valley 5.20% 8/1/09 ............................. 180,000 180,920
----------
5,081,969
----------
HIGHER EDUCATION REVENUE BONDS - 6.49%
Boise State University Idaho Revenue Refunding
& Improvement Student Fee (FSA) 5.00%
4/1/23 ........................................... 1,000,000 920,720
Idaho State University Student Fee Bonds
(MBIA) 5.80% 4/1/20 .............................. 550,000 563,508
University of Idaho Student Fees Recreation Center
(FSA) 5.00% 4/1/25 ............................... 1,000,000 908,810
University of Idaho Student Fee Telecommunications
(FSA) 5.85% 4/1/11 ............................... 1,300,000 1,363,089
----------
3,756,127
----------
HOSPITAL REVENUE BONDS - 17.92%
Idaho Health Facilities Authority Hospital Revenue -
Elks Rehabilitation Hospital 5.45% 7/15/23 ....... 2,000,000 1,809,640
Idaho Health Facilities Authority Revenue -
Bannock Regional Medical Project
5.25% 5/1/14 ..................................... 1,500,000 1,407,870
Idaho Health Facilities Authority Revenue -
Bannock Regional Medical Center 6.125%
5/1/25 ........................................... 1,500,000 1,505,340
<PAGE>
- -------------------------------------------------------------------------------
PRINCIPAL MARKET
AMOUNT VALUE
------------------------
MUNICIPAL BONDS (CONTINUED)
HOSPITAL REVENUE BONDS (CONTINUED)
Idaho Health Facilities Authority Revenue -
Bannock Regional Medical Center 6.375%
5/1/17 ........................................... $1,695,000 $ 1,771,021
Idaho Health Facilities Authority Revenue -
Bonner General Hospital 6.50% 10/1/28 ............ 1,500,000 1,496,010
Idaho Health Facilities Bingham Memorial Hospital
6.00% 3/1/29 ..................................... 2,000,000 1,876,920
Idaho Magic Valley Health Facilities (AMBAC)
5.625% 12/1/13 ................................... 500,000 511,165
-----------
10,377,966
-----------
HOUSING REVENUE BONDS - 7.41%
Idaho State Housing Agency Multi-Family Park
Place Project (FHA) 6.50% 12/1/36 ................ 990,000 1,025,204
Idaho State Housing Finance Authority Single
Family Series A (AMBAC) 6.05% 7/1/13 ............. 390,000 398,654
Idaho State Housing Finance Authority Single
Family Series A (FHA) 6.10% 7/1/16 ............... 365,000 370,431
Idaho State Housing Finance Authority Single
Family Series A1 6.85% 7/1/12 .................... 75,000 78,170
Idaho State Housing Finance Authority Single
Family Series B (FHA) 6.45% 7/1/15 ............... 185,000 190,631
Idaho State Housing Finance Authority Single
Family Series C-2 6.35% 7/1/15 ................... 245,000 252,779
Idaho State Housing Finance Authority Single
Family Series E 6.60% 7/1/11 ..................... 105,000 109,370
Idaho State Housing Finance Authority Single
Family Series E (FHA) 6.35% 7/1/15 ............... 335,000 346,216
Idaho State Housing Finance Authority Single
Family Series G-2 6.15% 7/1/15 ................... 1,495,000 1,521,761
-----------
4,293,216
-----------
INDUSTRIAL DEVELOPMENT REVENUE BONDS - 5.65%
Idaho State Water Resource Boise Water 7.25%
12/1/21 .......................................... 100,000 105,515
Meridan EDA for Hi-Micro 5.85% 8/15/11 .............. 1,250,000 1,269,175
Pocatello Development Authority and Tax Increment
Revenue 7.25% 12/1/08 ............................ 1,700,000 1,739,916
Puerto Rico Industrial Medical Environmental
Revenue - PepsiCo Project 6.25% 11/15/13 ......... 150,000 159,864
-----------
3,274,470
-----------
LEASE/CERTIFICATES OF PARTICIPATION - 1.75%
North Idaho College Dorm Housing - Certificates of
Participation 6.45% 10/1/16 ...................... 1,000,000 1,013,730
-----------
1,013,730
-----------
POLLUTION CONTROL REVENUE BONDS - 18.83%
Nez Perce County, Idaho Pollution Control Revenue
Refunding - Potlatch Project 6.00% 10/1/24 ....... 5,500,000 5,492,575
Power County Idaho Pollution Control Revenue -
FMC Project 5.625% 10/1/14 ....................... 5,570,000 5,412,703
-----------
10,905,278
-----------
<PAGE>
18 for tax-exempt income
DELAWARE TAX-FREE IDAHO FUND
STATEMENT OF NET ASSETS (CONTINUED)
- -------------------------------------------------------------------------------
PRINCIPAL MARKET
AMOUNT VALUE
------------------------
MUNICIPAL BONDS (CONTINUED)
POWER AUTHORITY REVENUE BONDS - 3.99%
+ Puerto Rico Electric Power Authority
5.56% 7/1/19 (FSA) ............................... $1,100,000 $ 821,007
Puerto Rico Electric Power Authority (FSA) 6.00%
7/1/16 ........................................... 100,000 104,715
Puerto Rico Electric Power Authority Series X
5.50% 7/1/25 ..................................... 1,415,000 1,386,219
----------
2,311,941
----------
* PRE-REFUNDED BONDS - 5.64%
Ada & Canyon County School District #2 5.60%
7/30/12-03 ....................................... 1,325,000 1,401,532
Ammon, Idaho Urban Renewal Agency Tax Increment
Revenue 6.25% 8/1/18-06 .......................... 445,000 485,277
Ammon, Idaho Urban Renewal Agency Tax Increment
Revenue 5.875% 8/1/17-04 ......................... 350,000 376,926
Canyon County Independent School District #131
(MBIA) 5.50% 7/30/12-03 .......................... 100,000 103,145
Gooding and Lincoln Independent School District
#231 6.30% 2/1/14-04 ............................. 100,000 107,414
Idaho Holy Cross - St. Alphonsus Regional Medical
Center 6.25% 12/1/22-02 .......................... 590,000 635,288
Puerto Rico Telephone Revenue Authority 5.50%
1/1/22-03 ........................................ 150,000 157,326
----------
3,266,908
----------
TRANSPORTATION REVENUE BONDS - 0.58%
Guam Highway (FSA) 6.30% 5/1/12 ................... 150,000 158,307
Puerto Rico Highway Revenue Series W 5.50%
7/1/15 ........................................... 175,000 176,461
----------
334,768
----------
WATER & SEWER REVENUE BONDS - 2.23%
Chubbuck Water Revenue 6.35% 4/1/08 ............... 125,000 129,674
Chubbuck Water Revenue 6.40% 4/1/10 ............... 135,000 140,106
McCall Water Revenue (FSA) 5.85% 3/1/16 ........... 1,000,000 1,023,100
----------
1,292,880
----------
OTHER REVENUE BONDS - 14.38%
Boise Urban Renewal Agency Tax Increment
Revenue 6.125% 9/1/15 ............................ 4,540,000 4,642,241
Hayden, Idaho Improvement District 95 -
Special Assessment 6.30% 5/1/12 .................. 115,000 115,216
Hayden, Idaho Improvement District 95 -
Special Assessment 6.35% 5/1/13 .................. 120,000 120,236
Hayden, Idaho Improvement District 95 -
Special Assessment 6.40% 5/1/14 .................. 125,000 125,271
Hayden, Idaho Improvement District 95 -
Special Assessment 6.50% 5/1/15 .................. 125,000 125,284
Idaho State Building Authority Building Revenue
Series A 4.75% 9/1/25 ............................ 1,500,000 1,302,525
Puerto Rico Public Building Authority Revenue
Series M 5.50% 7/1/21 ............................ 1,175,000 1,158,750
<PAGE>
- -------------------------------------------------------------------------------
PRINCIPAL MARKET
AMOUNT VALUE
------------------------
MUNICIPAL BONDS (CONTINUED)
OTHER REVENUE BONDS (CONTINUED)
Virgin Islands Public Finance Authority Revenue
Sub Lien Funded Notes Series E 5.875%
10/1/18 .......................................... $750,000 $ 735,218
-----------
8,324,741
-----------
Total Municipal Bonds (cost $54,410,324) 54,233,994
-----------
NUMBER
OF SHARES
---------
SHORT-TERM INVESTMENTS - 5.06%
Dreyfus Tax-Exempt Cash Management, Inc. ............ 38,545 38,545
Norwest Advantage Municipal Money Market Fund ....... 2,890,652 2,890,652
-----------
Total Short-Term Investments (cost $2,929,197) ...... 2,929,197
-----------
TOTAL MARKET VALUE OF SECURITIES OWNED
(COST $57,339,521) - 98.71% ................................ $57,163,191
RECEIVABLES AND OTHER ASSETS NET OF LIABILITIES -
1.29% ..................................................... 746,685
-----------
NET ASSETS APPLICABLE TO 5,296,849 SHARES
($0.01 PAR VALUE) OUTSTANDING - 100.00% .................... $57,909,876
===========
NET ASSET VALUE - TAX-FREE IDAHO FUND A CLASS
($44,299,357 / 4,050,855 SHARES) ........................... $10.94
===========
NET ASSET VALUE - TAX-FREE IDAHO FUND B CLASS
($10,199,350 / 933,698 SHARES) ............................. $10.92
===========
NET ASSET VALUE - TAX-FREE IDAHO FUND C CLASS
($3,411,169 / 312,296 SHARES) .............................. $10.92
===========
COMPONENTS OF NET ASSETS AT AUGUST 31, 1999:
Common stock, $0.01 par value, 100,000,000,000 shares
authorized to the Fund with 10,000,000,000 shares
allocated to Tax-Free Idaho Fund A Class,
10,000,000,000 shares allocated to the Tax-Free
Idaho Fund B Class and 10,000,000,000 shares
allocated to the Tax-Free Idaho Fund C Class ............... $58,130,838
Accumulated net realized loss on investments .................. (44,632)
Net unrealized depreciation of investments .................... (176,330)
-----------
Total net assets .............................................. $57,909,876
===========
- ----------------------
* For Pre-Refunded Bonds, the stated maturity is followed by the year in which
the bond is pre-refunded.
+ Inverse Floaters represent a security that pays interest at rates that
increase (decrease) with a decrease (increase) in a specific index. Interest
rates disclosed are in effect August 31, 1999.
Summary of Abbreviations:
AMBAC - Insured by the AMBAC Indemnity Corporation
FHA - Insured by the Federal Housing Authority
FSA - Insured by Financial Security Assurance
MBIA - Insured by the Municipal Bond Insurance Association
<PAGE>
for tax-exempt income 19
DELAWARE TAX-FREE IDAHO FUND
STATEMENT OF NET ASSETS (CONTINUED)
- -------------------------------------------------------------------------------
------------------------
NET ASSET VALUE AND OFFERING PRICE PER SHARE -
TAX-FREE IDAHO FUND
Net asset value A Class (A) ...................................... $10.94
Sales charge (3.75% of offering price, or
3.93% of amount invested per share) (B) ....................... 0.43
------
Offering price ................................................... $11.37
======
- ----------------------
(A) Net asset value per share, as illustrated, is the estimated amount which
would be paid upon the redemption or repurchase of shares.
(B) See How to Buy Shares in the current Prospectus for purchases of $100,000 or
more.
See accompanying notes
VOYAGEUR MUTUAL FUNDS, INC.
DELAWARE TAX-FREE IOWA FUND
STATEMENT OF NET ASSETS
AUGUST 31, 1999
- -------------------------------------------------------------------------------
PRINCIPAL MARKET
AMOUNT VALUE
-----------------------
MUNICIPAL BONDS - 100.11%
GENERAL OBLIGATION BONDS - 0.95%
Puerto Rico Commonwealth Public Improvement
4.50% 7/1/23 ..................................... $ 500,000 $ 414,905
----------
414,905
----------
HIGHER EDUCATION REVENUE BONDS - 9.27%
Iowa Center Community College Dormitory -
Merged Area V 5.45% 6/1/18 ....................... 545,000 505,128
Iowa Finance Authority Revenue - Student
Housing Dormitory Revenues for Iowa Valley
Community College 5.85% 5/1/19 ................... 855,000 802,734
Iowa State University Science & Technology
Revenue Dormitory 4.85% 7/1/25 ................... 440,000 392,440
Puerto Rico Educational Facility Revenue -
Polytechnic University 6.50% 8/1/24 .............. 640,000 674,842
State University of Iowa - Board Of Regents
5.30% 7/1/13 ..................................... 500,000 508,985
University of North Iowa - Board Of Regents
5.30% 7/1/13 ..................................... 150,000 152,695
University of Puerto Rico Revenue (MBIA) 5.50%
6/1/15 ........................................... 1,000,000 1,013,750
----------
4,050,574
----------
HOSPITAL REVENUE BONDS - 2.92%
Puerto Rico Hospital Revenue - Hospital Auxilio
Mutuo Obligated Group (MBIA) 6.25%
7/1/24 ........................................... 1,200,000 1,277,292
----------
1,277,292
----------
HOUSING REVENUE BONDS - 1.60%
Puerto Rico Housing Bank & Finance Agency
(GNMA) 6.25% 4/1/29 .............................. 675,000 697,174
----------
697,174
----------
<PAGE>
- -------------------------------------------------------------------------------
PRINCIPAL MARKET
AMOUNT VALUE
------------------------
MUNICIPAL BONDS (CONTINUED)
INDUSTRIAL DEVELOPMENT REVENUE BONDS - 18.18%
Iowa Finance Authority - Underground Storage
Tank Revenue 5.125% 7/1/14 ...................... $5,200,000 $5,138,484
Lee County Urban Renewal Revenue - Keokuk
Waste Treatment 6.40% 6/1/07 .................... 500,000 519,785
Puerto Rico Commonwealth Industrial Development
General Purpose Revenue Series B 5.375%
7/1/16 .......................................... 1,000,000 973,480
Puerto Rico Port Authority Revenue - Special
Facility - American Airlines (AMT) 6.25%
6/1/26 .......................................... 1,275,000 1,312,893
----------
7,944,642
----------
POWER AUTHORITY REVENUE BONDS - 9.25%
+Puerto Rico Electric Power Authority Revenue
Series DD (FSA) 5.56% 7/1/19 .................... 1,000,000 746,370
Puerto Rico Electric Power Authority Revenue
Series EE 4.75% 7/1/24 .......................... 1,400,000 1,204,448
Puerto Rico Electric Power Authority Revenue
Series U 6.00% 7/1/14 ........................... 1,100,000 1,158,982
Virgin Islands Water & Power Authority Electric
System Revenue 5.30% 7/1/18 ..................... 1,000,000 934,400
----------
4,044,200
----------
*PRE-REFUNDED/ESCROWED TO MATURITY
BONDS - 6.59%
Puerto Rico Electric Power Authority Revenue
6.25% 7/1/17-02 ................................. 1,000,000 1,065,460
Virgin Islands Public Finance Authority (Escrowed
to maturity) 7.30% 10/1/18 ...................... 1,500,000 1,814,430
----------
2,879,890
----------
TRANSPORTATION REVENUE BONDS - 7.94%
Guam Highway (FSA) 6.30% 5/1/12 .................... 1,950,000 2,057,991
Puerto Rico Commonwealth Highway &
Transportation Revenue 5.25% 7/1/21 ............. 1,500,000 1,414,395
----------
3,472,386
----------
UTILITY REVENUE BONDS - 5.09%
Puerto Rico Telephone Revenue Authority 5.50%
1/1/22 .......................................... 2,120,000 2,223,541
----------
2,223,541
----------
WATER & SEWER REVENUE BONDS - 10.62%
Iowa Finance Authority - State Revolving Fund
Revenue 5.20% 5/1/23 ............................ 2,445,000 2,323,581
Iowa Finance Authority - State Revolving Fund
Revenue 6.25% 5/1/24 ............................ 1,750,000 1,855,963
Virgin Islands Water & Power Authority Water
System Revenue 5.50% 7/1/17 ..................... 510,000 461,560
----------
4,641,104
----------
OTHER REVENUE BONDS - 27.70%
Bettendorf, Iowa Urban Renewal Tax Increment
Revenue-Series A 5.00% 6/1/00 ................... 300,000 300,456
Bettendorf, Iowa Urban Renewal Tax Increment
Revenue-Series A 5.10% 6/1/01 ................... 315,000 316,121
<PAGE>
20 for tax-exempt income
DELAWARE TAX-FREE IOWA FUND
STATEMENT OF NET ASSETS (CONTINUED)
- -------------------------------------------------------------------------------
PRINCIPAL MARKET
AMOUNT VALUE
------------------------
MUNICIPAL BONDS (CONTINUED)
OTHER REVENUE BONDS (CONTINUED)
Bettendorf, Iowa Urban Renewal Tax Increment
Revenue-Series A 5.20% 6/1/02 .................... $ 330,000 $ 331,815
Bettendorf, Iowa Urban Renewal Tax Increment
Revenue-Series A 5.30% 6/1/03 .................... 345,000 347,529
Bettendorf, Iowa Urban Renewal Tax Increment
Revenue-Series A 5.40% 6/1/04 .................... 365,000 368,307
Bettendorf, Iowa Urban Renewal Tax Increment
Revenue-Series A 5.50% 6/1/05 .................... 385,000 389,115
Bettendorf, Iowa Urban Renewal Tax Increment
Revenue-Series A 5.60% 6/1/06 .................... 405,000 409,945
Bettendorf, Iowa Urban Renewal Tax Increment
Revenue-Series A 5.70% 6/1/07 .................... 425,000 430,797
Bettendorf, Iowa Urban Renewal Tax Increment
Revenue-Series A 5.80% 6/1/08 .................... 450,000 456,111
Bettendorf, Iowa Urban Renewal Tax Increment
Revenue-Series A 5.90% 6/1/09 .................... 800,000 810,320
Iowa Finance Authority Revenue - Correctional
Facility Program 5.70% 6/15/14 ................... 2,000,000 2,056,260
Puerto Rico Municipal Finance Authority (FSA)
6.00% 7/1/14 ..................................... 1,700,000 1,798,073
Puerto Rico Public Building Authority Revenue -
Series L 5.75% 7/1/16 ............................ 1,000,000 1,011,240
Puerto Rico Public Building Authority Revenue -
Series M 5.50% 7/1/21 ............................ 1,100,000 1,084,787
Puerto Rico Public Building Authority Revenue -
Series M 5.75% 7/1/15 ............................ 1,000,000 1,016,220
Virgin Islands Public Finance Authority Revenue -
Sub Lien Funded Loan Notes Series E 5.875%
10/1/18 .......................................... 1,000,000 980,290
-----------
12,107,386
-----------
Total Municipal Bonds (cost $42,734,514) ............ 43,753,094
-----------
<PAGE>
- -------------------------------------------------------------------------------
TOTAL MARKET VALUE OF SECURITIES OWNED - 100.11%
(COST $42,734,514) .......................................... $43,753,094
LIABILITIES NET OF RECEIVABLES AND OTHER ASSETS - (0.11%) ...... (49,972)
-----------
NET ASSETS APPLICABLE TO 4,506,043 SHARES
($0.01 PAR VALUE) OUTSTANDING - 100.00% ..................... $43,703,122
===========
NET ASSET VALUE - TAX-FREE IOWA FUND A CLASS
($37,807,080 / 3,898,185 SHARES) ............................ $9.70
=====
NET ASSET VALUE - TAX-FREE IOWA FUND B CLASS
($4,599,935 / 474,190 SHARES) ............................... $9.70
=====
NET ASSET VALUE - TAX-FREE IOWA FUND C CLASS
($1,296,107 / 133,668 SHARES) ............................... $9.70
=====
COMPONENTS OF NET ASSETS AT AUGUST 31, 1999:
Common stock, $0.01 par value, 10,000,000,000 shares
authorized to the Fund with 1,000,000,000 shares
allocated to Tax-Free Iowa Fund A Class, 1,000,000,000
shares allocated to Tax-Free Iowa Fund B Class,
1,000,000,000 shares allocated to Tax-Free Iowa
Fund C Class ................................................ $44,308,634
Accumulated net realized loss on investments ................... (1,624,092)
Net unrealized appreciation of investments ..................... 1,018,580
-----------
Total net assets ............................................... $43,703,122
===========
- ----------------------
* For Pre-Refunded Bonds, the stated maturity is followed by the year in which
each bond is pre-refunded.
+ Inverse Floaters represent a security that pays interest at rates that
increase (decrease) with a decrease (increase) in a specific index. Interest
rates disclosed are in effect August 31, 1999.
Summary of Abbreviations:
AMT - Alternative Minimum Tax
FSA - Insured by Financial Security Assurance
GNMA - Insured by the Government National Mortgage Association
MBIA - Insured by the Municipal Bond Insurance Association
NET ASSET VALUE AND OFFERING PRICE PER SHARE - TAX-FREE IOWA FUND
Net asset value A Class (A) .................................... $9.70
Sales charge (3.75% of offering price or 3.92% of amount
invested per share) (B) ..................................... 0.38
------
Offering price ................................................. $10.08
======
- ----------------------
(A) Net asset value per share, as illustrated, is the estimated amount which
would be paid upon the redemption or repurchase of shares.
(B) See How to Buy Shares in the current Prospectus for purchases of $100,000 or
more.
See accompanying notes
<PAGE>
for tax-exempt income 21
VOYAGEUR INVESTMENT TRUST
DELAWARE TAX-FREE KANSAS FUND
STATEMENT OF NET ASSETS
AUGUST 31, 1999
- -------------------------------------------------------------------------------
PRINCIPAL MARKET
AMOUNT VALUE
-------------------------
MUNICIPAL BONDS - 93.89%
CERTIFICATE OF PARTICIPATION - 7.48%
Linn County, Kansas for American One, LLC
7.25% 3/1/13 ..................................... $ 350,000 $ 342,941
Spring Hill Certificate of Participation A Spring
Hill Golf Corp. 6.50% 1/15/28 .................... 1,000,000 917,980
----------
1,260,921
----------
GENERAL OBLIGATION BONDS - 13.10%
Allen County Unified School District #258
(AMBAC) 6.875% 9/1/10 ............................ 240,000 276,389
Ellsworth County, Kansas Series 1 5.75% 9/1/17 ...... 250,000 252,870
Linn County Unified School District 5.70%
11/1/16 .......................................... 500,000 510,855
Puerto Rico Commonwealth Public Improvement
4.50% 7/1/23 ..................................... 1,100,000 912,791
Summer County Unified School District #356
(MBIA) 5.75% 9/1/11 .............................. 250,000 257,132
----------
2,210,037
----------
HIGHER EDUCATION REVENUE BONDS - 12.71%
Kansas Development Finance Authority - Kansas
Board of Regents - Wichita State University
(AMBAC) 5.875% 6/1/17 ............................ 300,000 307,077
Puerto Rico Educational Facility Revenue -
Polytechnic University 6.50% 8/1/24 .............. 1,150,000 1,212,606
Winfield Kansas Educational Facilities Revenue
Refunding and Improvement 5.75% 4/1/22 ........... 680,000 623,764
----------
2,143,447
----------
HOSPITAL REVENUE BONDS - 11.47%
Kansas State Development Finance Authority
Health Facilities Revenue Stormont - Vail
Healthcare (MBIA) 2.95% 11/15/23 ................. 600,000 600,000
Lawrence, Kansas for Lawrence Memorial
Hospital 6.20% 7/1/19 ............................ 250,000 256,032
Olathe, Kansas Health Facility Revenue for
Evangelical Lutheran Good Samaritan Project
(AMBAC) 6.00% 5/1/19 ............................. 250,000 258,138
Olathe, Kansas Health Facility Revenue for Olathe
Medical Center Series 94A (AMBAC) 5.875%
9/1/16 ........................................... 100,000 101,214
Shawnee County Sister of Charity Leavenworth
Hospital (FSA) 5.00% 12/1/23 ..................... 250,000 222,037
Wichita, Kansas Health Care Improvement
Industrial Revenue (The Kansas Masonic
Home - Series VI) 6.25% 12/1/17 .................. 500,000 496,715
----------
1,934,136
----------
HOUSING REVENUE BONDS - 9.68%
Kansas Development Finance Authority Revenue
for Martin Creek Multifamily Housing Project
(FHA) 6.50% 8/1/24 ............................... 50,000 51,841
<PAGE>
- -------------------------------------------------------------------------------
PRINCIPAL MARKET
AMOUNT VALUE
-------------------------
MUNICIPAL BONDS (CONTINUED)
HOUSING REVENUE BONDS (CONTINUED)
Kansas State Development Finance Authority
Multifamily Revenue - Oak Ridge Park
Apartments Project - Series F 6.625%
8/1/29 ........................................... $1,000,000 $1,022,140
Olathe, Kansas Multifamily Housing - Deerfield
Apartments Series 1994A (FNMA) 6.45%
6/1/19 ........................................... 250,000 258,668
Olathe, Kansas Multifamily Housing - Jefferson
Place Apartments Project - Series B 6.10%
7/1/22 ........................................... 300,000 300,576
----------
1,633,225
----------
INDUSTRIAL DEVELOPMENT REVENUE BONDS - 7.27%
Columbus Kansas Industrial Revenue ACE
Electrical Acquisition 7.00% 8/1/17 .............. 800,000 782,392
Manhattan, Kansas Industrial Revenue
Farrar Corp. Project 7.00% 8/1/14 ................ 400,000 393,796
Wamego Pollution Control Revenue Western
Resources Inc. Project (MBIA) 6.00% 2/1/33 ....... 50,000 50,952
----------
1,227,140
----------
POWER AUTHORITY REVENUE BONDS - 5.45%
+ Puerto Rico Electric Power Authority
5.60% 7/1/19 ..................................... 600,000 447,822
Puerto Rico Electric Power Authority Series Z
5.25% 7/1/21 ..................................... 500,000 471,465
----------
919,287
----------
* PRE-REFUNDED BONDS - 19.78%
Douglas County Lawrence Unified School District
#497 6.00% 9/1/15-03 ............................. 250,000 262,082
Jefferson County Unified School District #340
(FSA) 6.35% 9/1/15-04 ............................ 250,000 270,715
Johnson County G.O. Improvement 6.125%
9/1/12-02 ........................................ 600,000 626,790
Kansas City Community College Student Center
(MBIA) 6.25% 5/15/20-02 .......................... 300,000 314,973
Kansas City Utility System Revenue (FGIC)
6.375% 9/1/23-04 ................................. 295,000 324,497
Kansas Development Finance Authority Water
Pollution Control Sewer Revenue 6.00%
11/1/14-03 ....................................... 250,000 268,915
Maize Unified School District #266 Series 1994
(FSA) 5.875% 9/1/12-03 ........................... 250,000 263,560
Sedgwick County Unified School District #265
(FSA) 5.50% 10/1/13-04 ........................... 250,000 261,457
Sedgwick County Unified School District #267
6.15% 11/1/09-05 ................................. 250,000 270,288
Shawnee County Unified School District #345
(MBIA) 5.75% 9/1/11-04 ........................... 250,000 264,068
Shawnee County Unified School District #501
(FGIC) 5.75% 2/1/11-03 ........................... 200,000 208,264
----------
3,335,609
----------
<PAGE>
22 for tax-exempt income
DELAWARE TAX-FREE KANSAS FUND
STATEMENT OF NET ASSETS (CONTINUED)
- -------------------------------------------------------------------------------
PRINCIPAL MARKET
AMOUNT VALUE
-------------------------
MUNICIPAL BONDS (CONTINUED)
TRANSPORTATION REVENUE BONDS - 0.59%
Kansas Department of Transportation 5.375%
3/1/13 ........................................... $100,000 $ 100,306
-----------
100,306
-----------
WATER & SEWER REVENUE BONDS - 6.36%
Haysville Water & Sewer (FSA) 5.80% 10/1/16 ......... 250,000 256,840
Johnson County Water Revenue 5.25% 12/1/15 .......... 175,000 172,914
Kansas City Utility System Revenue (FGIC)
6.375% 9/1/23 .................................... 605,000 642,528
-----------
1,072,282
-----------
Total Municipal Bonds (cost $15,471,683) 15,836,390
-----------
TOTAL MARKET VALUE OF SECURITIES OWNED - 93.89%
(COST $15,471,683) ........................................ $15,836,390
RECEIVABLES AND OTHER ASSETS NET OF LIABILITIES - 6.11% ...... 1,030,020
-----------
NET ASSETS APPLICABLE TO 1,585,132 SHARES
($0.01 PAR VALUE) OUTSTANDING - 100.00% ................... $16,866,410
===========
NET ASSET VALUE - TAX-FREE KANSAS FUND A CLASS
($11,497,655 / 1,081,077 SHARES) .......................... $10.64
===========
NET ASSET VALUE - TAX-FREE KANSAS FUND B CLASS
($4,910,483 / 460,968 SHARES) ............................. $10.65
===========
NET ASSET VALUE - TAX-FREE KANSAS FUND C CLASS
($458,272 / 43,087 SHARES) ................................ $10.64
===========
COMPONENTS OF NET ASSETS AT AUGUST 31,1999:
Common stock, $0.01 par value, unlimited shares authorized
to the Tax-Free Kansas Fund ............................... $16,544,649
Undistributed net investment income .......................... 7,180
Accumulated net realized loss on investments ................. (50,126)
Net unrealized appreciation of investments ................... 364,707
-----------
Total net assets ............................................. $16,866,410
===========
- ----------------------
* For Pre-Refunded Bonds, the stated maturity is followed by the year in which
the bond is pre-refunded.
+ Inverse Floaters represent a security that pays interest at rates that
increase (decrease) with a decrease (increase) in a specific index. Interest
rates disclosed are in effect August 31, 1999.
<PAGE>
- --------------------------------------------------------------------------------
Summary of Abbreviations:
AMBAC - Insured by the AMBAC Indemnity Corporation
FGIC - Insured by the Financial Guaranty Insurance Company
FHA - Insured by the Federal Housing Authority
FNMA - Insured by the Federal National Mortgage Association
FSA - Insured by Financial Security Assurance
MBIA - Insured by the Municipal Bond Insurance Association
NET ASSET VALUE AND OFFERING PRICE PER SHARE -
TAX-FREE KANSAS FUND
Net asset value A Class (A) .................................. $10.64
Sales charge (3.75% of offering price or 3.85% of amount
invested per share) (B) ................................... 0.41
------
Offering price ............................................... $11.05
======
- ----------------------
(A) Net asset value per share, as illustrated, is the estimated amount which
would be paid upon the redemption or repurchase of shares.
(B) See How to Buy Shares in the current Prospectus for purchases of $100,000 or
more.
See accompanying notes
VOYAGEUR INVESTMENT TRUST -
DELAWARE TAX-FREE KANSAS FUND
STATEMENT OF ASSETS AND LIABILITIES
AUGUST 31, 1999
ASSETS:
Investments at market (Cost $15,471,683) ............ $15,836,390
Cash ................................................ 854,254
Interest receivable ................................. 252,509
Subscriptions receivable ............................ 97,007
Receivable for securities sold ...................... 779,954
Other assets ........................................ 3,449
-----------
Total assets ..................................... $17,823,563
-----------
LIABILITIES:
Payable for securities purchased .................... 922,669
Other accounts payable and accrued expenses ......... 34,484
-----------
Total liabilities ................................ 957,153
-----------
TOTAL NET ASSETS .................................... $16,866,410
===========
See accompanying notes
<PAGE>
for tax-exempt income 23
VOYAGEUR INVESTMENT TRUST
DELAWARE TAX-FREE MISSOURI INSURED FUND
STATEMENT OF NET ASSETS
AUGUST 31, 1999
- ------------------------------------------------------------------------------
PRINCIPAL MARKET
AMOUNT VALUE
------------------------
MUNICIPAL BONDS - 98.45%
GENERAL OBLIGATION BONDS - 5.40%
Springfield School District #R12 Series A (MBIA)
5.25% 3/1/11 ..................................... $ 500,000 $ 501,260
St. Charles (FSA) 5.75% 3/1/15 ...................... 1,000,000 1,021,150
St. Charles County Montana Francis Howell
School District Capital Appreciation (FGIC)
0.00% 3/1/16 ..................................... 2,000,000 791,460
St Charles County Montana Francis Howell
School District Capital Appreciation (FGIC)
0.00% 3/1/17 ..................................... 1,500,000 557,340
----------
2,871,210
----------
HIGHER EDUCATION REVENUE BONDS - 1.89%
Missouri State Health & Education Facility -
Central Missouri State University (AMBAC)
5.75% 10/1/25 .................................... 1,000,000 1,002,990
----------
1,002,990
----------
HOSPITAL REVENUE BONDS - 25.24%
Cape Girardeau SE Missouri Hospital (MBIA)
5.25% 6/1/16 ..................................... 1,000,000 977,060
Hannibal Health Facilities Series A (Hannibal
Regional Hospital) (FSA) 5.625% 3/1/12 ........... 2,500,000 2,560,150
Hannibal Health Facilities Series A (Hannibal
Regional Hospital) (FSA) 5.75% 3/1/22 ............ 1,000,000 1,005,330
Jackson County St. Joseph's Hospital (MBIA)
6.50% 7/1/12 ..................................... 1,895,000 2,020,544
Jackson County St. Mary's Hospital (MBIA)
5.75% 7/1/24 ..................................... 2,000,000 2,006,520
Missouri State Health & Education Facility
(Children's Mercy Hospital) (MBIA) 5.65%
5/15/23 .......................................... 1,000,000 1,000,390
Missouri State Health & Education Facility (Health
Midwest) (MBIA) 6.25% 2/15/22 .................... 1,000,000 1,041,600
Missouri State Health & Education Facility
(Heartland Health Systems) (AMBAC) 6.35%
11/15/17 ......................................... 1,250,000 1,317,137
Missouri State Health & Education Facility (SSM
Health Care) (MBIA) 6.40% 6/1/10 ................. 500,000 549,730
Missouri State Health & Education Facility (St.
Luke's Health Systems) (MBIA) 5.125%
11/15/19 ......................................... 1,000,000 933,720
----------
13,412,181
----------
HOUSING REVENUE BONDS - 14.76%
Missouri Single Family Housing (FNMA/GNMA)
7.20% 9/1/26 ..................................... 1,640,000 1,797,014
Missouri Single Family Housing (FNMA/GNMA)
7.25% 9/1/26 ..................................... 1,965,000 2,124,420
Missouri Single Family Housing (FNMA/GNMA)
7.45% 9/1/27 ..................................... 1,585,000 1,748,413
Missouri Single Family Housing (FNMA/GNMA)
7.55% 9/1/27 ..................................... 1,470,000 1,610,576
<PAGE>
- --------------------------------------------------------------------------------
PRINCIPAL MARKET
AMOUNT VALUE
--------------------------
MUNICIPAL BONDS (CONTINUED)
HOUSING REVENUE BONDS (CONTINUED)
Missouri Single Family Housing (GNMA) 7.20%
12/1/17 ......................................... $ 175,000 $ 185,899
Missouri Single Family Housing (GNMA) 7.25%
12/1/20 ......................................... 355,000 376,020
-----------
7,842,342
-----------
INDUSTRIAL DEVELOPMENT REVENUE BONDS - 1.95%
St. Louis Municipal Finance Corporation City
Lease Revenue - City Justice Center,
Series A (AMBAC) 5.95% 2/15/16 .................. 1,000,000 1,038,260
-----------
1,038,260
-----------
LEASE - 1.94%
Kansas City Muehlebach Hotel (FSA) 5.90%
12/1/18 ......................................... 1,000,000 1,033,290
-----------
1,033,290
-----------
POWER AUTHORITY REVENUE BONDS - 4.63%
Puerto Rico Electric Power Authority Power
Revenue-Series EE (MBIA) 4.50% 7/1/18 ........... 500,000 433,320
+Puerto Rico Electric Power Authority Power
Revenue (FSA) 5.56%
7/1/19 .......................................... 1,275,000 951,622
Sikeston Electric Revenue (MBIA) 6.00% 6/1/13 ...... 1,000,000 1,075,740
-----------
2,460,682
-----------
*PRE-REFUNDED/ESCROWED TO MATURITY
Bonds - 27.34%
Clark County School District (FSA) 5.75%
3/1/15-05 ....................................... 1,775,000 1,854,715
Franklin County School District (FGIC) 5.75%
3/1/13-03 ....................................... 1,100,000 1,134,320
Greene County Single Family Mortgage Revenue -
(Private Mortgage Insurance) (Escrowed to
maturity) 0.00% 3/1/16 .......................... 1,225,000 492,597
Kansas City Airport Revenue (FSA) 6.875%
9/1/14-04 ....................................... 1,675,000 1,866,168
Sikeston Electric Revenue (MBIA) 6.25%
6/1/12-02 ....................................... 2,000,000 2,137,000
St. Charles School District (FGIC) 6.50%
2/1/14-06 ....................................... 1,250,000 1,373,237
St. Louis County School District #8 (MBIA) 5.60%
2/15/15-05 ...................................... 1,490,000 1,559,598
St. Louis Municipal Finance Corporation
Leasehold Revenue - (FGIC) 6.25%
2/15/12-05 ...................................... 1,850,000 1,993,763
Troy School District #3 Lincoln County (MBIA)
6.10% 3/1/14-05 ................................. 1,235,000 1,322,796
West Platte School District (MBIA) 5.85%
3/1/15-05 ....................................... 750,000 794,318
-----------
14,528,512
-----------
<PAGE>
24 for tax-exempt income
DELAWARE TAX-FREE MISSOURI INSURED FUND
STATEMENT OF NET ASSETS (CONTINUED)
- ------------------------------------------------------------------------------
PRINCIPAL MARKET
AMOUNT VALUE
------------------------
MUNICIPAL BONDS (CONTINUED)
UTILITY REVENUE BONDS - 4.30%
Missouri Environmental Pollution Control Revenue -
St. Joseph's Light and Power Co. (AMBAC)
5.85% 2/1/13 .......................................$2,200,000 $ 2,281,290
-----------
2,281,290
-----------
WATER & SEWER REVENUE BONDS - 4.18%
Liberty Sewer (MBIA) 6.00% 2/1/08 ..................... 600,000 644,166
Liberty Sewer (MBIA) 6.15% 2/1/15 ..................... 1,500,000 1,577,550
-----------
2,221,716
-----------
OTHER REVENUE BONDS - 6.82%
Kansas City Municipal Assistance - Bartle Hall
Convention Center (MBIA) 5.60% 4/15/16 ............. 1,240,000 1,249,077
Missouri State Environmental - State Revolving
Fund - Branson (FSA) 6.05% 7/1/16 .................. 2,265,000 2,372,950
-----------
3,622,027
-----------
Total Municipal Bonds (cost $50,484,553) 52,314,500
-----------
TOTAL MARKET VALUE OF SECURITIES OWNED - 98.45%
(COST $50,484,553) ................................. $52,314,500
RECEIVABLES AND OTHER ASSETS NET OF LIABILITIES - 1.55% 825,381
-----------
NET ASSETS APPLICABLE TO 5,139,267 SHARES
($0.01 PAR VALUE) OUTSTANDING - 100.00% ............ $53,139,881
===========
NET ASSET VALUE - TAX FREE MISSOURI INSURED FUND A CLASS
($42,336,683 / 4,094,260 SHARES) ................... $10.34
======
NET ASSET VALUE - TAX FREE MISSOURI INSURED FUND B CLASS
($10,571,727 / 1,022,634 SHARES) ................... $10.34
======
NET ASSET VALUE - TAX FREE MISSOURI INSURED FUND C CLASS
($231,471 / 22,373 SHARES) ......................... $10.35
======
<PAGE>
- --------------------------------------------------------------------------------
COMPONENTS OF NET ASSETS AT AUGUST 31, 1999:
Common stock, $0.01 par value, 10,000,000,000 shares
authorized to the Fund with 1,000,000,000 shares allocated
to Tax Free Missouri Insured Fund A Class, 1,000,000,000
shares allocated to Tax Free Missouri Insured Fund B Class
and 1,000,000,000 shares allocated to Tax Free Missouri
Insured Fund C Class ................................... $52,155,347
Accumulated net realized loss on investments .............. (845,413)
Net unrealized appreciation of investments ................ 1,829,947
------------
Total net assets .......................................... $53,139,881
============
- ----------------------
* For Pre-Refunded Bonds, the stated maturity is followed by the year in which
each bond is pre-refunded.
+ Inverse Floaters represent a security that pays interest at rates that
increase (decrease) with a decrease (increase) in a specific index. Interest
rates disclosed are in effect August 31, 1999.
Summary of Abbreviations:
AMBAC - Insured by the Ambac Indemnity Corporation
FGIC - Insured by the Financial Guaranty Insurance Company
FNMA - Insured by the Federal National Mortgage Association
FSA - Insured by Financial Security Assurance
GNMA - Insured by the Government National Mortgage Association
MBIA - Insured by the Municipal Bond Insurance Association
NET ASSET VALUE AND OFFERING PRICE PER SHARE -
TAX-FREE MISSOURI INSURED FUND
Net asset value A Class (A) ....................................... $10.34
Sales charge (3.75% of offering price or
3.87% of amount invested per share) (B) ........................ $ 0.40
------
Offering price .................................................... $10.74
======
- ----------------------
(A) Net asset value per share, as illustrated, is the estimated amount which
would be paid upon the redemption or repurchase of shares.
(B) See How to Buy Shares in the current Prospectus for purchases of $100,000 or
more.
See accompanying notes
<PAGE>
for tax-exempt income 25
VOYAGEUR TAX-FREE FUNDS, INC.
DELAWARE TAX-FREE NORTH DAKOTA FUND
STATEMENT OF NET ASSETS
AUGUST 31, 1999
PRINCIPAL MARKET
AMOUNT VALUE
--------------------------
MUNICIPAL BONDS - 97.07%
GENERAL OBLIGATION BONDS - 0.99%
Grand Forks Sewer Revenue 6.70% 6/1/07 ............... $270,000 $279,696
----------
279,696
----------
HIGHER EDUCATION REVENUE BONDS - 6.09%
Burleigh County North Dakota University Facility
Revenue University of Mary Project 5.625%
12/1/15 ........................................... 1,000,000 949,390
North Dakota State University Housing & Auxiliary
Facility 6.30% 4/1/07 ............................. 250,000 259,520
North Dakota State University Housing & Auxiliary
Facility 6.50% 4/1/12 ............................. 500,000 519,790
----------
1,728,700
----------
HOSPITAL REVENUE BONDS - 29.00%
Cando, North Dakota Nursing Facility Revenue -
Towner County Medical Center Project
7.125% 8/1/22 ..................................... 1,000,000 1,051,280
Carrington, North Dakota Health Facility Revenue
for Carrington Health Center 6.25%
11/15/15 .......................................... 500,000 522,910
Cass County, North Dakota Health Facility Revenue
for Catholic Health - Villa Nazareth Project
6.25% 11/15/14 .................................... 1,000,000 1,047,210
Fargo Hospital Facility St. Luke's Hospital, Series
1992 6.50% 6/1/15 ................................. 1,000,000 1,050,580
Grand Forks, North Dakota Senior Housing
Revenue 4000 Valley Square Project
6.25% 12/1/34 ..................................... 2,000,000 1,944,360
Grand Forks, United Hospital Obligated Group
(MBIA) 6.125% 12/1/14.............................. 225,000 238,383
Grand Forks, United Hospital Obligated Group
(MBIA) 6.25% 12/1/19 .............................. 250,000 264,725
Killdeer, North Dakota Nursing Care Revenue -
Hill Top Home of Comfort 6.00% 11/1/12 ............ 820,000 804,584
Valley City, North Dakota Congregate Housing
Revenue - Bridgeview Estates Project 7.25%
8/1/22 ............................................ 300,000 315,918
Ward County, North Dakota Health Care Facility
Revenue - Trinity Obligated Group Series 96A
6.00% 7/1/11 ...................................... 1,000,000 997,390
----------
8,237,340
----------
HOUSING REVENUE BONDS - 25.02%
Minot Single Family Mortgage 7.70% 8/1/10 ............ 130,000 134,306
North Dakota Housing Finance Agency Single
Family Mortgage Series A (FHA) 6.75%
7/1/12 ............................................ 140,000 145,823
North Dakota Housing Finance Authority Single
Family Mortgage 6.25% 1/1/17 ...................... 2,105,000 2,175,349
North Dakota Housing Finance Authority Single
Family Mortgage Series A 6.30% 7/1/16 ............. 1,770,000 1,835,242
North Dakota State Housing Finance Agency
Revenue Multifamily (FNMA) 6.125%
12/1/15 ........................................... 500,000 515,130
<PAGE>
PRINCIPAL MARKET
AMOUNT VALUE
--------------------------
MUNICIPAL BONDS (CONTINUED)
HOUSING REVENUE BONDS (CONTINUED)
North Dakota State Housing Finance Agency
Revenue Multifamily (FNMA) 6.15%
12/1/17 ........................................... $1,300,000 $1,339,728
North Dakota State Housing Finance Agency
Single Family Mortgage Series E (FNMA)
6.30% 1/1/15 ...................................... 680,000 700,033
North Dakota State Housing Finance Authority
Single Family Mortgage Series A 6.95%
7/1/12 ............................................ 250,000 261,250
----------
7,106,861
----------
INDUSTRIAL DEVELOPMENT REVENUE BONDS - 1.85%
Mercer County Pollution Control - Otter Tail Power
Company Project 6.90% 2/1/19 ...................... 500,000 525,595
----------
525,595
----------
POWER AUTHORITY REVENUE BONDS - 11.41%
Mercer County Pollution Control Revenue
Montana - Dakota Utilities Company Project
(FGIC) 6.65% 6/1/22 ............................... 500,000 531,720
Mercer County Pollution Control Revenue for Basin
Electric Revenue 6.05% 1/1/19 ..................... 1,250,000 1,282,563
+Puerto Rico Electric Power Authority
(FSA) 5.56% 7/1/19 ................................ 900,000 671,733
Puerto Rico Electric Power Authority Series Z
5.25% 7/1/21 ..................................... 800,000 754,344
----------
3,240,360
----------
*PRE-REFUNDED BONDS - 4.08%
Bismarck Hospital Alexius Medical Center
(AMBAC) 6.90% 5/1/06-01 ........................... 500,000 531,820
Burleigh County University Facilities University
of Mary Project 7.125% 12/1/11-01 ................. 250,000 267,650
Fargo Park District Revenue 7.25% 11/1/11-00 ........ 200,000 207,358
North Dakota State Municipal Bond Bank 6.25%
12/1/11-99 ....................................... 150,000 150,942
----------
1,157,770
----------
TRANSPORTATION REVENUE BONDS - 5.13%
Puerto Rico Commonwealth Highway &
Transportation Authority Series Y 5.50%
7/1/26 ............................................ 1,500,000 1,456,890
----------
1,456,890
----------
TERRITORIAL REVENUE BONDS - 3.13%
Guam Power Series A 5.125% 10/1/29 .................. 1,000,000 890,160
----------
890,160
----------
OTHER REVENUE BONDS - 10.37%
North Dakota Building Authority Revenue (FSA)
6.00% 12/1/14 ..................................... 1,310,000 1,361,706
North Dakota Building Authority Revenue (FSA)
6.10% 12/1/16 ..................................... 1,480,000 1,543,758
North Dakota State Student Loan (AMBAC)
7.00% 7/1/05 ...................................... 40,000 41,122
----------
2,946,586
----------
Total Municipal Bonds (cost $26,954,827)............. 27,569,958
----------
<PAGE>
26 for tax-exempt income
DELAWARE TAX-FREE NORTH DAKOTA FUND
STATEMENT OF NET ASSETS (CONTINUED)
NUMBER MARKET
OF SHARES VALUE
--------------------------
SHORT-TERM INVESTMENTS - 0.05%
Norwest Advantage Municipal Money Market Fund .......... 15,037 $15,037
-----------
Total Short-Term Investments (cost $15,037)............. 15,037
-----------
TOTAL MARKET VALUE OF SECURITIES OWNED
(COST $26,969,864) - 97.12% ............................ $27,584,995
RECEIVABLES AND OTHER ASSETS NET OF LIABILITIES - 2.88%.... 817,147
-----------
NET ASSETS APPLICABLE TO 2,625,724 SHARES
($0.01 PAR VALUE) OUTSTANDING - 100.00%................. $28,402,142
===========
NET ASSET VALUE - TAX-FREE NORTH DAKOTA FUND A CLASS
($27,032,045 / 2,499,048 SHARES) ....................... $10.82
======
NET ASSET VALUE - TAX-FREE NORTH DAKOTA FUND B CLASS
($1,048,484 / 96,932 SHARES) ........................... $10.82
======
NET ASSET VALUE - TAX-FREE NORTH DAKOTA FUND C CLASS
($321,613 / 29,744 SHARES) ............................. $10.81
======
COMPONENTS OF NET ASSETS AT AUGUST 31, 1999:
Common stock, $0.01 par value, 10,000,000,000 shares
authorized to the Fund with 1,000,000,000 shares
allocated to Tax-Free North Dakota Fund A Class,
1,000,000,000 shares allocated to the Tax-Free North
Dakota Fund B Class and 1,000,000,000 shares allocated
to the Tax-Free North Dakota Fund C Class .............. $27,833,532
Accumulated net realized loss on investments .............. (46,521)
Net unrealized appreciation of investments ................ 615,131
-----------
Total net assets .......................................... $28,402,142
===========
- ----------------------
* For Pre-Refunded Bonds, the stated maturity is followed by the year in which
the bond is pre-refunded.
+ Inverse Floaters represent a security that pays interest at rates that
increase (decrease) with a decrease (increase) in a specific index. Interest
rates disclosed are in effect August 31, 1999.
Summary of Abbreviations:
AMBAC - Insured by the AMBAC Indemnity Corporation
FGIC - Insured by the Financial Guaranty Insurance Company
FHA - Insured by the Federal Housing Authority
FNMA - Insured by the Federal National Mortgage Association
FSA - Insured by Financial Security Assurance
MBIA - Insured by the Municipal Bond Insurance Association
NET ASSET VALUE AND OFFERING PRICE PER SHARE -
TAX-FREE NORTH DAKOTA FUND
Net asset value A Class (A)................................ $10.82
Sales charge (3.75% of offering price, or
3.88% of amount invested per share) (B) ................ 0.42
------
Offering price ........................................... $11.24
======
- ----------------------
(A) Net asset value per share, as illustrated, is the estimated amount which
would be paid upon the redemption or repurchase of shares.
(B) See How to Buy Shares in the current Prospectus for purchases of $100,000 or
more.
See accompanying notes
<PAGE>
VOYAGEUR INVESTMENT TRUST
DELAWARE TAX-FREE OREGON INSURED FUND
STATEMENT OF NET ASSETS
AUGUST 31, 1999
PRINCIPAL MARKET
AMOUNT VALUE
--------------------------
MUNICIPAL BONDS - 94.63%
CERTIFICATES OF PARTICIPATION - 6.11%
Oregon State Department Administrative Services
Certificate of Participation-Series A (AMBAC)
5.00% 5/1/24 ..................................... $2,500,000 $2,266,500
----------
2,266,500
----------
GENERAL OBLIGATION BONDS - 21.04%
Clackamas County Oregon School District (FGIC)
4.80% 6/1/18 ...................................... 1,500,000 1,348,815
Columbia County Oregon School District (FGIC)
0.00% 6/1/17 ...................................... 1,000,000 366,340
Hermiston Water Bonds (AMBAC) 6.20% 8/1/24 500,000 515,290
Josephine County Oregon (AMBAC) 4.875%
6/1/18............................................. 1,000,000 907,790
Lane County School District #19 (Springfield)
(FGIC) 6.00% 10/15/14.............................. 500,000 534,440
Lincoln County School District (FGIC) 5.25%
6/15/12 ........................................... 1,450,000 1,444,534
Malheur County Jail (MBIA) 6.30% 12/1/12 500,000 534,725
Multnomah County School District #3 Park Rose
(FGIC) 5.50% 12/1/11 ............................. 500,000 506,030
North Unit Irrigation District (MBIA) 5.75%
6/1/16 ........................................... 1,000,000 1,020,600
Portland (MBIA) 5.75% 6/1/15 ......................... 500,000 512,215
Umatilla County Oregon School District #6R
Umatilla (AMBAC) 0.00% 12/15/22 ................... 200,000 52,236
Washington County School District (Sherwood)
(FSA) #88J 6.10% 6/1/12 ........................... 65,000 68,559
----------
7,811,574
----------
HIGHER EDUCATION REVENUE BONDS - 12.82%
Central Oregon Community College (FGIC) 5.90%
6/1/09 ............................................ 750,000 777,173
Oregon Health and Education Authority for Lewis &
Clark College (MBIA) 6.125% 10/1/24 ............... 1,055,000 1,105,123
Oregon Health and Education Authority for Reed
College (MBIA) 5.375% 7/1/25 ...................... 1,000,000 977,400
Oregon Health Sciences University (MBIA)
0.00% 7/1/21 ...................................... 6,500,000 1,897,935
----------
4,757,631
----------
HOSPITAL REVENUE BONDS - 5.55%
Western Lane Hospital District for Sisters of
St. Joseph Peace Hospital (MBIA) 5.75%
8/1/19 ............................................ 1,000,000 1,014,160
Western Lane Hospital District for Sisters of
St. Joseph Peace Hospital (MBIA) 5.875%
8/1/12 ............................................ 1,000,000 1,045,200
----------
2,059,360
----------
<PAGE>
for tax-exempt income 27
DELAWARE TAX-FREE OREGON INSURED FUND
STATEMENT OF NET ASSETS (CONTINUED)
PRINCIPAL MARKET
AMOUNT VALUE
--------------------------
MUNICIPAL BONDS (CONTINUED)
HOUSING REVENUE BONDS - 2.98%
Oregon Health, Housing, Educational and Cultural
Facilities Authority for Pier Park Project
(GNMA) 6.05% 4/1/18 ............................... $1,095,000 $1,107,352
----------
1,107,352
----------
POWER AUTHORITY REVENUE BONDS - 6.76%
Central Lincoln Peoples Utility District (AMBAC)
5.75% 1/1/15 ...................................... 500,000 509,585
Northern Wasco County Peoples Utility District
(FGIC) 5.625% 12/1/22 ............................. 1,000,000 1,008,480
+Puerto Rico Electric Power Authority Revenue Series
DD (FSA) 5.560% 7/1/19 ............................ 750,000 559,778
Puerto Rico Electric Power Ref-EE Revenue (MBIA)
4.50% 7/1/18 ...................................... 500,000 433,320
----------
2,511,163
----------
*PRE-REFUNDED BONDS - 21.57%
Chemeketa Community College (FGIC) 5.80%
6/1/12-06 ......................................... 1,500,000 1,594,305
Eugene Electric Revenue Series C (MBIA) 5.80%
8/1/22-04 ......................................... 1,250,000 1,332,013
Lane County School District #19 Springfield
(MBIA) 6.30% 10/15/14-04 .......................... 500,000 545,155
Multnomah County School District #39 Corbett
(MBIA) 6.00% 12/1/13-04 ........................... 500,000 533,930
Oregon State Department Administrative Services
Certificate of Participation-Series A (AMBAC)
5.80% 5/1/24-07 ................................... 1,000,000 1,070,350
Portland Sewer System Revenue (FSA) 6.25%
6/1/15-04 ......................................... 1,000,000 1,082,920
Tillamook County (FGIC) 6.25% 1/1/14-05 ............. 250,000 270,993
Umatilla Pendleton School District (AMBAC)
#016R 6.00% 7/1/14-04 ............................. 500,000 536,670
Washington County Education Service (MBIA)
7.10% 6/1/25-05 ................................... 700,000 786,646
Washington County School District (Sherwood)
(FSA) #88J 6.10% 6/1/12-05 ........................ 235,000 252,352
----------
8,005,334
----------
TRANSPORTATION REVENUE BONDS - 5.25%
Portland Airport Revenue for Portland
International Airport (FGIC) 5.625% 7/1/26 ........ 2,000,000 1,949,840
----------
1,949,840
----------
ATER & SEWER REVENUE BONDS - 12.55%
Beaverton Water Revenue (FSA) 6.125% 6/1/14 ........ 500,000 525,680
Klamath Falls Water Revenue (FSA) 6.10%
6/1/14 ............................................ 500,000 528,405
Portland Oregon Sewer System Revenue (MBIA)
4.500% 6/1/18 ..................................... 1,855,000 1,577,678
Salem Water & Sewer Revenue (MBIA) 5.50%
6/1/14............................................. 1,000,000 1,012,820
Salem Water & Sewer Revenue (MBIA) 5.625%
6/1/16 ............................................ 1,000,000 1,013,610
----------
4,658,193
----------
Total Municipal Bonds (cost $34,883,725) ............ 35,126,947
----------
<PAGE>
NUMBER MARKET
OF SHARES VALUE
--------------------------
SHORT-TERM INVESTMENTS - 3.55%
Norwest Advantage Municipal Money Market Fund ....... 1,317,573 $1,317,573
----------
Total Short-Term Investments (cost $1,317,573) ....... 1,317,573
----------
TOTAL MARKET VALUE OF SECURITIES OWNED
(COST $36,201,298) - 98.18% ............................ $36,444,520
RECEIVABLES AND OTHER ASSETS NET OF LIABILITIES - 1.82% ... 675,915
-----------
NET ASSETS APPLICABLE TO 3,785,201 SHARES
($0.01 PAR VALUE) OUTSTANDING - 100.00%................. $37,120,435
===========
NET ASSET VALUE - TAX-FREE OREGON INSURED FUND A CLASS
($27,518,580 / 2,806,494 SHARES) ....................... $9.81
=====
NET ASSET VALUE - TAX-FREE OREGON INSURED FUND B CLASS
($7,998,890 / 815,429 SHARES) .......................... $9.81
=====
NET ASSET VALUE - TAX-FREE OREGON INSURED FUND C CLASS
($1,602,965 / 163,278 SHARES) .......................... $9.82
=====
COMPONENTS OF NET ASSETS AT AUGUST 31, 1999:
Common stock, $0.01 par value, unlimited shares authorized
to the Tax-Free Oregon Insured Fund ................... $37,469,847
Accumulated net realized loss on investments .............. (592,634)
Net unrealized appreciation of investments ............... 243,222
-----------
Total net assets .......................................... $37,120,435
===========
- ----------------------
* For Pre-Refunded Bonds, the stated maturity is followed by the year in which
each bond is pre-refunded.
+ Inverse Floaters represent a security that pays interest at rates that
increase (decrease) with a decrease (increase) in a specific index. Interest
rates disclosed are in effect August 31, 1999.
Summary of Abbreviations:
AMBAC - Insured by the AMBAC Indemnity Corporation
FGIC - Insured by the Financial Guaranty Insurance Company
FSA - Insured by the Financial Security Assurance
GNMA - Insured by the Government National Mortgage Association
MBIA - Insured by the Municipal Bond Insurance Association
NET ASSET VALUE AND OFFERING PRICE PER SHARE -
TAX-FREE OREGON INSURED FUND
Net asset value A Class (A) .............................. $9.81
Sales charge (3.75% of offering price, or
3.87% of amount invested per share) (B)................. 0.38
------
Offering price ............................................ $10.19
======
- ----------------------
(A) Net asset value per share, as illustrated, is the estimated amount which
would be paid upon redemption or repurchase of shares.
(B) See How to Buy Shares in the current Prospectus for purchases of
$100,000 or more.
See accompanying notes
<PAGE>
28 for tax-exempt income
VOYAGEUR MUTUAL FUNDS, INC.
DELAWARE TAX-FREE WISCONSIN FUND
STATEMENT OF NET ASSETS
AUGUST 31, 1999
PRINCIPAL MARKET
AMOUNT VALUE
--------------------------
MUNICIPAL BONDS - 101.46%
GENERAL OBLIGATION BONDS - 1.52%
Puerto Rico Commonwealth Public Improvement
4.50% 7/1/23 ...................................... $700,000 $580,867
--------
580,867
--------
HIGHER EDUCATION REVENUE BONDS - 2.17%
Madison Community Development Authority
Revenue - Edgewood College 6.25% 4/1/14 ........... 500,000 526,100
Puerto Rico Educational Facility Revenue -
Polytechnic University 6.50% 8/1/24 ............... 285,000 300,515
--------
826,615
--------
HOSPITAL REVENUE BONDS - 1.85%
Kaukauna Housing Authority Revenue - St. Paul
Home Inc. 6.10% 9/1/07 ............................ 200,000 202,174
Puerto Rico Industrial Tourist Educational Medical
& Environmental Control Facilities
(Hospital Auxilio Mutuo Project-Series A)
5.50% 7/1/17 ...................................... 500,000 503,355
--------
705,529
--------
HOUSING REVENUE BONDS - 27.76%
Dane County Multifamily Housing Revenue -
Forest Harbor Apartment Project 5.85%
7/1/11 ............................................ 125,000 126,769
Dane County Multifamily Housing Revenue -
Forest Harbor Apartment Project 5.90%
7/1/12 ............................................ 125,000 126,082
Grant County Wisconsin Housing Authority
Revenue Refunding - Housing - Orchard
Manor 5.35% 7/1/26 ................................ 1,000,000 942,950
Green Bay Wisconsin Housing Authority Multifamily
Housing Revenue - Moraine Limited -
Series A (FHA) 6.15% 12/1/30 ...................... 2,225,000 2,266,697
La Crosse Housing Authority Washburn Project
6.375% 10/1/16 .................................... 100,000 100,712
La Crosse Housing Authority Washburn Project
6.50% 10/1/26 ..................................... 250,000 250,832
Milwaukee Redevelopment Authority Multifamily
Housing 6.30% 8/1/38............................... 1,455,000 1,474,148
New Berlin Multifamily Housing Authority
Revenue 7.125% 5/1/24 ............................. 500,000 525,425
Puerto Rico Housing Authority Single Family
Mortgage Revenue 6.85% 10/15/23 ................... 625,000 649,550
Puerto Rico Housing Bank and Finance Agency
(GNMA) 6.25% 4/1/29 .............................. 680,000 702,338
Superior Housing Authority - St. Francis Project
(GNMA) 6.00% 1/20/22 .............................. 565,000 571,294
Superior Housing Authority - St. Francis Project
(GNMA) 6.15% 7/20/31 .............................. 835,000 842,841
Waukesha Wisconsin Housing Westgrove Wood Project
(GNMA) 6.00% 12/1/31 .............................. 1,500,000 1,523,220
<PAGE>
PRINCIPAL MARKET
AMOUNT VALUE
--------------------------
MUNICIPAL BONDS (CONTINUED)
HOUSING REVENUE BONDS (CONTINUED)
Wauwatosa Multifamily Housing Revenue -
Harwood Place, Inc. 5.75% 12/1/08 ................. $480,000 $ 480,490
-----------
10,583,348
-----------
INDUSTRIAL DEVELOPMENT REVENUE BONDS - 16.09%
Hartford Community Development Authority Lease
Revenue 6.15% 12/1/09 ............................. 240,000 253,819
Milwaukee Redevelopment Authority Revenue -
Goodwill Industries, Inc. 6.35% 10/1/09 ........... 2,000,000 2,067,500
Omro Community Development Authority
5.875% 12/1/11 .................................... 300,000 312,936
Puerto Rico Commonwealth Industrial
Development General Purpose Revenue
Series B 5.375% 7/1/16............................. 1,000,000 973,480
Puerto Rico Industrial Medical Environmental
Revenue - PepsiCo Project 6.25%
11/15/13 .......................................... 1,100,000 1,172,336
Two Rivers Community Development Authority
Revenue Architectural Forest Products
6.35% 12/15/12 ..................................... 250,000 251,363
West Allis Community Development Authority
Revenue - Poblocki Investments, Ltd.
5.90% 5/1/03 ...................................... 1,080,000 1,104,462
-----------
6,135,896
-----------
LEASE/CERTIFICATES OF PARTICIPATION - 14.28%
Cudahy Community Development Authority
Revenue 6.00% 6/1/11 .............................. 1,000,000 1,053,640
De Forest Redevelopment Lease Revenue
6.25% 2/1/18 ...................................... 1,000,000 1,033,220
Little Chute Community Development Lease
Revenue 5.625% 3/1/19 ............................. 680,000 681,278
Madison Community Development Authority,
Monona Terrace Community Project 5.80%
3/1/05 ............................................ 125,000 131,961
Madison Community Development Authority,
Monona Terrace Community Project 5.90%
3/1/06 ............................................ 365,000 385,268
Madison Community Development Authority,
Monona Terrace Community Project 6.10%
3/1/10 ............................................ 1,500,000 1,587,270
Redgranite Wisconsin Community Development
Authority Revenue 5.85% 3/1/18 .................... 605,000 570,473
-----------
5,443,110
-----------
*PRE-REFUNDED/ESCROWED TO MATURITY
BONDS - 9.18%
Puerto Rico Telephone Authority Revenue 5.75%
1/1/11-02 ......................................... 285,000 293,046
Southeast Wisconsin Professional Baseball Park
District Sales Tax Revenue (MBIA) 5.80%
12/15/26-07 ...................................... 1,000,000 1,069,570
<PAGE>
for tax-exempt income 29
Delaware Tax-Free Wisconsin Fund
Statement of Net Assets (Continued)
PRINCIPAL MARKET
AMOUNT VALUE
--------------------------
MUNICIPAL BONDS (CONTINUED)
*PRE-REFUNDED/ESCROWED TO MATURITY BONDS (CONTINUED)
Superior Redevelopment Authority Revenue -
Superior Memorial Hospital (FHA) 5.80%
5/1/10-02 ........................................ $250,000 $ 263,652
Virgin Islands Public Finance Authority (Escrowed
to maturity) 7.30% 10/1/18 ........................ 700,000 846,734
Wisconsin Housing Finance Authority (FHA)
6.10% 6/1/21-17 ................................... 980,000 1,027,422
----------
3,500,424
----------
POWER AUTHORITY REVENUE BONDS - 5.14%
Puerto Rico Electric Power Authority Series EE
4.75% 7/1/24 ...................................... 500,000 430,160
Puerto Rico Electric Power Authority Revenue
Series U 6.00% 7/1/14 ............................. 1,450,000 1,527,749
----------
1,957,909
----------
TERRITORIAL REVENUE BONDS - 2.33%
Guam Power Authority Revenue 99A 5.125%
10/1/29 ........................................... 1,000,000 890,160
----------
890,160
----------
OTHER REVENUE BONDS - 21.14%
Puerto Rico Municipal Finance Authority (FSA)
6.00% 7/1/14 ..................................... 1,800,000 1,903,842
Southeast Wisconsin Professional Baseball Park
District Lease Certificates Zero Coupon (MBIA)
0.00% 12/15/15 ................................... 1,000,000 401,080
Southeast Wisconsin Professional Baseball Park
District Sales Revenue Zero Coupon (MBIA)
0.00% 12/15/16 .................................... 1,115,000 419,273
Southeast Wisconsin Professional Baseball Park
District Sales Tax Revenue Zero Coupon (MBIA)
0.00% 12/15/24 .................................... 1,500,000 343,995
Southeast Wisconsin Professional Baseball Park
District Sales Tax Revenue Zero Coupon (MBIA)
0.00% 12/15/25 .................................... 1,250,000 269,750
Southeast Wisconsin Professional Baseball Park
District Sales Tax Revenue Zero Coupon
(MBIA) 0.00% 12/15/28 ............................ 6,250,000 1,129,000
Virgin Islands Public Finance Authority Revenue
Sub Lien Funded Loan Notes Series E 5.875%
10/1/18 ........................................... 750,000 735,218
Wisconsin Central District Tax Revenue - (FSA)
5.25% 12/15/23 ................................... 3,000,000 2,857,440
----------
8,059,598
----------
Total Municipal Bonds (cost $38,514,209)............. 38,683,456
----------
<PAGE>
TOTAL MARKET VALUE OF SECURITIES OWNED - 101.46%
(COST $38,514,209) ..................................... $38,683,456
LIABILITIES NET OF RECEIVABLES OTHER ASSETS - (1.46%) ..... (558,393)
-----------
NET ASSETS APPLICABLE TO 3,993,664 SHARES
($0.01 PAR VALUE) OUTSTANDING - 100.00% ................ $38,125,063
===========
NET ASSET VALUE - TAX-FREE WISCONSIN FUND A CLASS
($33,410,229 / 3,499,945 SHARES) ....................... $9.55
=====
NET ASSET VALUE - TAX-FREE WISCONSIN FUND B CLASS
($3,205,781 / 336,090 SHARES) .......................... $9.54
=====
NET ASSET VALUE - TAX-FREE WISCONSIN FUND C CLASS
($1,509,053 / 157,629 SHARES) .......................... $9.57
=====
COMPONENTS OF NET ASSETS AT AUGUST 31, 1999:
Common stock, $0.01 par value, 100,000,000,000 shares
authorized to the Fund with 10,000,000,000 shares
allocated to Tax-Free Wisconsin Fund A Class,
10,000,000,000 shares allocated to Tax-Free
Wisconsin Fund B Class, and 10,000,000,000 shares
allocated to Tax-Free Wisconsin Fund C Class ........... $38,463,373
Accumulated net realized loss on investments .............. (507,557)
Net unrealized appreciation of investments ................ 169,247
-----------
Total net assets .......................................... $38,125,063
===========
- ----------------------
* For Pre-Refunded Bonds, the stated maturity is followed by the year in which
each bond is pre-refunded.
Summary of Abbreviations:
FHA - Insured by the Federal Housing Authority
FSA - Insured by the Financial Security Assurance
GNMA - Insured by the Government National Mortgage Association
MBIA - Insured by the Municipal Bond Insurance Association
NET ASSET VALUE AND OFFERING PRICE PER SHARE -
TAX-FREE WISCONSIN FUND
Net asset value A Class (A) ............................... $9.55
Sales charge (3.75% of offering price or 3.87%
of amount invested per share) (B)....................... 0.37
-----
Offering price............................................. $9.92
=====
- ----------------------
(A) Net asset value per share, as illustrated, is the estimated amount which
would be paid upon the redemption or repurchase of shares.
(B) See How to Buy Shares in the current Prospectus for purchases of $100,000 or
more.
See accompanying notes
<PAGE>
30 for tax-exempt income
<TABLE>
<CAPTION>
STATEMENTS OF OPERATIONS
YEAR ENDED AUGUST 31, 1999
- --------------------------------------------------------------------------------------------------------------------
VOYAGEUR MUTUAL FUNDS, INC. VOYAGEUR INVESTMENT TRUST
TAX-FREE TAX-FREE TAX-FREE TAX-FREE
IDAHO IOWA KANSAS MISSOURI
FUND FUND FUND INSURED FUND
---------- ----------- ---------- -------------
<S> <C> <C> <C> <C>
INVESTMENT INCOME:
Interest ................................................ $ 2,987,647 $ 2,424,720 $1,000,057 $ 3,131,274
EXPENSES:
Management fees ......................................... 281,574 233,909 91,783 279,337
Distribution expense .................................... 215,272 156,497 77,068 224,409
Dividend disbursing and transfer agent fees and expenses. 45,672 54,766 16,577 48,336
Accounting and administration ........................... 21,356 19,525 7,293 20,075
Reports and statements to shareholders .................. 20,200 18,050 6,356 25,385
Professional fees ....................................... 27,171 6,600 4,411 19,270
Registration fees ....................................... 4,250 11,250 1,250 4,050
Custodian fees .......................................... 6,243 5,600 2,150 2,800
Taxes (other than taxes on income) ...................... 9,310 8,855 360 6,000
Directors' fees ......................................... 1,361 1,290 806 1,465
Other ................................................... 15,117 18,814 6,214 17,464
----------- ----------- ---------- -----------
647,526 535,156 214,268 648,591
Less expenses absorbed or waived ........................ (21,192) (38,183) (13,425) (27,206)
Less expenses paid indirectly ........................... (1,246) (1,041) (394) (1,287)
----------- ----------- ---------- -----------
Total operating expenses ................................ 625,088 495,932 200,449 620,098
Interest expense ........................................ 127 108 990 8,501
----------- ----------- ---------- -----------
Total expenses .......................................... 625,215 496,040 201,439 628,599
----------- ----------- ---------- -----------
NET INVESTMENT INCOME ................................... 2,362,432 1,928,680 798,618 2,502,675
----------- ----------- ---------- -----------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain (loss) on investments ................. 3,735 4,469 (39,464) 71,644
Net change in unrealized appreciation/depreciation
of investments ....................................... (3,206,434) (2,113,084) (743,441) (2,815,501)
----------- ----------- ---------- -----------
NET REALIZED AND UNREALIZED LOSS ON INVESTMENTS ......... (3,202,699) (2,108,615) (782,905) (2,743,857)
----------- ----------- ---------- -----------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING
FROM OPERATIONS ...................................... $ (840,267) $ (179,935) $ 15,713 $ (241,182)
=========== =========== ========== ===========
</TABLE>
See accompanying notes
<PAGE>
for tax-exempt income 31
<TABLE>
<CAPTION>
STATEMENTS OF OPERATIONS (CONTINUED)
- ------------------------------------------------------------------------------------------------------
VOYAGEUR VOYAGEUR VOYAGEUR
TAX-FREE TAX-FREE TAX-FREE
FUNDS, INC. TRUST FUNDS, INC.
TAX-FREE TAX-FREE TAX-FREE
NORTH DAKOTA OREGON WISCONSIN
FUND INSURED FUND FUND
------------ ------------ -----------
<S> <C> <C> <C>
INVESTMENT INCOME:
Interest ...................................................$1,772,260 $1,895,900 $2,205,402
EXPENSES:
Management fees ............................................ 158,426 181,007 207,708
Distribution expense ....................................... 87,006 151,397 132,697
Dividend disbursing and transfer agent fees and expenses ... 38,794 35,756 34,936
Accounting and administration .............................. 11,059 14,695 16,246
Reports and statements to shareholders ..................... 6,500 11,317 11,350
Professional fees .......................................... 8,550 19,613 15,705
Registration fees .......................................... 4,900 3,458 7,050
Custodian fees ............................................. 3,402 4,388 600
Taxes (other than taxes on income) ......................... 5,900 2,695 4,050
Directors' fees ............................................ 2,743 894 970
Other ...................................................... 490 8,918 13,842
---------- ---------- ----------
327,770 434,138 445,154
Less expenses absorbed or waived ........................... (10,715) (77,875) (13,413)
Less expenses paid indirectly .............................. (703) (833) (916)
---------- ---------- ----------
Total operating expenses ................................... 316,352 355,430 430,825
Interest expense ........................................... 109 74 1,355
---------- ---------- ----------
Total expenses ............................................. 316,461 355,504 432,180
---------- ---------- ----------
Net Investment Income ...................................... 1,455,799 1,540,396 1,773,222
---------- ---------- ----------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain (loss) on investments .................... 8,108 19,477 (13,496)
Net change in unrealized appreciation/depreciation
of investments ..........................................(1,549,466) (2,333,795) (2,175,827)
---------- ---------- ----------
NET REALIZED AND UNREALIZED LOSS ON INVESTMENTS ............(1,541,358) (2,314,318) (2,189,323)
---------- ---------- ----------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING
FROM OPERATIONS .........................................$ (85,559) $ (773,922) $ (416,101)
========== ========== ==========
</TABLE>
See accompanying notes
<PAGE>
32 for tax-exempt income
<TABLE>
<CAPTION>
STATEMENTS OF CHANGES IN NET ASSETS
- ------------------------------------------------------------------------------------------------------------------------------------
VOYAGEUR MUTUAL FUNDS, INC. VOYAGEUR MUTUAL FUNDS, INC.
TAX-FREE IDAHO FUND TAX-FREE IOWA FUND
--------------------------------------- ---------------------------------------
YEAR ENDED EIGHT MONTHS YEAR ENDED YEAR ENDED EIGHT MONTHS YEAR ENDED
8/31/99 ENDED 8/31/98 12/31/97 8/31/99 ENDED 8/31/98 12/31/97
<S> <C> <C> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS:
Net investment income ............................... $ 2,362,432 $ 1,374,105 $ 1,840,447 $ 1,928,680 $ 1,235,896 $ 1,895,350
Net realized gain (loss) on investments ............. 3,735 (48,367) 52,973 4,469 88,606 (58,844)
Net change in unrealized appreciation/depreciation
of investments ................................... (3,206,434) 530,971 1,890,831 (2,113,084) 339,009 1,936,561
---------- ---------- ---------- ---------- ---------- ----------
Net increase (decrease) in net assets resulting
from operations .................................. (840,267) 1,856,709 3,784,251 (179,935) 1,663,511 3,773,067
---------- ---------- ---------- ---------- ---------- ----------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income:
A Class .......................................... (1,935,872) (1,150,721) (1,561,674) (1,719,461) (1,131,168) (1,786,140)
B Class .......................................... (335,490) (189,350) (273,521) (162,016) (80,006) (84,786)
C Class .......................................... (87,683) (37,421) (40,080) (47,203) (24,722) (27,910)
Net realized gain on investments:
A Class .......................................... -- (17,132) -- -- -- --
B Class .......................................... -- (3,270) -- -- -- --
C Class .......................................... -- (743) -- -- -- --
---------- ---------- ---------- ---------- ---------- ----------
(2,359,045) (1,398,637) (1,875,275) (1,928,680) (1,235,896) (1,898,836)
---------- ---------- ---------- ---------- ---------- ----------
CAPITAL SHARE TRANSACTIONS:
Proceeds from shares sold:
A Class .......................................... 9,856,564 8,852,050 8,087,405 3,458,664 2,443,972 3,470,467
B Class .......................................... 4,177,758 1,019,252 2,019,434 1,357,796 1,090,688 1,320,305
C Class .......................................... 2,255,562 707,681 702,551 552,911 492,175 247,082
Net asset value of shares issued upon reinvestment
of distributions from net investment income and
net realized gain on investments:
A Class .......................................... 1,311,933 770,231 967,219 1,076,296 710,428 1,211,605
B Class .......................................... 223,743 120,095 155,808 107,503 57,358 64,063
C Class .......................................... 71,289 30,628 34,029 31,942 14,242 10,869
---------- ---------- ---------- ---------- ---------- ----------
17,896,849 11,499,937 11,966,446 6,585,112 4,808,863 6,324,391
---------- ---------- ---------- ---------- ---------- ----------
Cost of shares repurchased:
A Class .......................................... (4,222,098) (3,937,453) (4,493,235) (4,250,442) (2,530,245) (8,103,037)
B Class .......................................... (1,125,972) (564,955) (611,419) (557,678) (184,748) (232,768)
C Class .......................................... (475,466) (160,744) (480,962) (444,977) (166,201) (90,968)
---------- ---------- ---------- ---------- ---------- ----------
(5,823,536) (4,663,152) (5,585,616) (5,253,097) (2,881,194) (8,426,773)
---------- ---------- ---------- ---------- ---------- ----------
Increase (decrease) in net assets derived from
capital share transactions ....................... 12,073,313 6,836,785 6,380,830 1,332,015 1,927,669 (2,102,382)
---------- ---------- ---------- ---------- ---------- ----------
NET INCREASE (DECREASE) IN NET ASSETS ............... 8,874,001 7,294,857 8,289,806 (776,600) 2,355,284 (228,151)
NET ASSETS:
Beginning of period ................................. 49,035,875 41,741,018 33,451,212 44,479,722 42,124,438 42,352,589
---------- ---------- ---------- ---------- ---------- ----------
End of period ....................................... $57,909,876 $49,035,875 $41,741,018 $43,703,122 $44,479,722 $42,124,438
========== ========== ========== ========== ========== ==========
</TABLE>
See accompanying notes
<PAGE>
for tax-exempt income 33
<TABLE>
<CAPTION>
STATEMENTS OF CHANGES IN NET ASSETS (CONTINUED)
- ------------------------------------------------------------------------------------------------------------------------------------
VOYAGEUR INVESTMENT TRUST VOYAGEUR INVESTMENT TRUST
TAX-FREE KANSAS FUND TAX-FREE MISSOURI INSURED FUND
------------------------------------ ----------------------------------------
YEAR ENDED EIGHT MONTHS YEAR ENDED YEAR ENDED EIGHT MONTHS YEAR ENDED
8/31/99 ENDED 8/31/98 12/31/97 8/31/99 ENDED 8/31/98 12/31/97
<S> <C> <C> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS:
Net investment income ..............................$ 798,618 $ 466,674 $ 627,158 $ 2,502,675 $ 1,765,610 $ 2,788,692
Net realized gain (loss) on investments ............ (39,464) 119,598 127,741 71,644 155,408 176,623
Net change in unrealized appreciation/depreciation
of investments .................................. (743,441) 42,397 513,267 (2,815,501) 179,094 2,344,920
----------- ---------- --------- ----------- ---------- ----------
Net increase (decrease) in net assets resulting
from operations ................................. 15,713 628,669 1,268,166 (241,182) 2,100,112 5,310,235
----------- ---------- --------- ----------- ---------- ----------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income:
A Class ......................................... (605,332) (364,485) (506,768) (2,067,634) (1,467,138) (2,362,959)
B Class ......................................... (178,626) (99,218) (123,076) (427,632) (294,147) (458,482)
C Class ......................................... (7,598) (2,853) (4,201) (7,409) (4,325) (7,784)
Net realized gain on investments:
A Class ......................................... (38,685) -- -- -- -- --
B Class ......................................... (12,054) -- -- -- -- --
C Class ......................................... (373) -- -- -- -- --
----------- ---------- --------- ----------- ---------- ----------
(842,668) (466,556) (634,045) (2,502,675) (1,765,610) (2,829,225)
----------- ---------- --------- ----------- ---------- ----------
CAPITAL SHARE TRANSACTIONS:
Proceeds from shares sold:
A Class ......................................... 2,372,007 2,693,842 1,225,439 1,609,116 1,374,617 2,768,917
B Class ......................................... 1,912,350 420,715 948,070 511,000 399,452 2,097,849
C Class ......................................... 354,261 40,545 74,506 172,422 30,000 100,000
Net asset value of shares issued upon reinvestment
of distributions from net investment income and
net realized gain on investments:
A Class ......................................... 317,555 187,468 297,771 1,064,643 758,855 1,353,277
B Class ......................................... 131,928 66,415 83,728 257,250 183,416 349,671
C Class ......................................... 6,220 2,795 4,294 4,334 2,854 5,484
----------- ---------- --------- ----------- ---------- ----------
5,094,321 3,411,780 2,633,808 3,618,765 2,749,194 6,675,198
----------- ---------- --------- ----------- ---------- ----------
Cost of shares repurchased:
A Class ......................................... (3,158,135) (1,121,317) (1,511,541) (5,087,919) (4,032,289) (6,861,721)
B Class ......................................... (596,102) (280,393) (135,792) (970,200) (834,476) (1,840,881)
C Class ......................................... (15,377) (26,367) (66,004) (44,506) (146,282) (42,129)
----------- ---------- --------- ----------- ---------- ----------
(3,769,614) (1,428,077) (1,713,337) (6,102,625) (5,013,047) (8,744,731)
----------- ---------- --------- ----------- ---------- ----------
Increase (decrease) in net assets derived from
capital share transactions ...................... 1,324,707 1,983,703 920,471 (2,483,860) 2,263,853 (2,069,533)
----------- ---------- --------- ----------- ---------- ----------
NET INCREASE (DECREASE) IN NET ASSETS .............. 497,752 2,145,816 1,554,592 (5,227,717) (1,929,351) 411,477
NET ASSETS:
Beginning of period ................................ 16,368,658 14,222,842 12,668,250 58,367,598 60,296,949 59,885,472
----------- ---------- --------- ----------- ---------- ----------
End of period ......................................$16,866,410 $16,368,658 $14,222,842 $53,139,881 $58,367,598 $60,296,949
=========== =========== =========== =========== ========== ==========
</TABLE>
See accompanying notes
<PAGE>
34 for tax-exempt income
<TABLE>
<CAPTION>
STATEMENTS OF CHANGES IN NET ASSETS (CONTINUED)
- ------------------------------------------------------------------------------------------------------------------------------------
VOYAGEUR TAX-FREE FUNDS, INC. VOYAGEUR INVESTMENT TRUST
TAX-FREE NORTH DAKOTA FUND TAX-FREE OREGON INSURED FUND
------------------------------------ ---------------------------------------
YEAR ENDED EIGHT MONTHS YEAR ENDED YEAR ENDED EIGHT MONTHS YEAR ENDED
8/31/99 ENDED 8/31/98 12/31/97 8/31/99 ENDED 8/31/98 12/31/97
<S> <C> <C> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS:
Net investment income ................................$ 1,455,799 $ 1,015,407 $ 1,601,793 $ 1,540,396 $ 895,746 $ 1,271,100
Net realized gain (loss) on investments .............. 8,108 151,151 416,818 19,477 (11,500) 17,126
Net change in unrealized appreciation/depreciation
of investments .................................... (1,549,466) 154,096 880,044 (2,333,795) 368,882 1,188,556
---------- ---------- ---------- ---------- ---------- ----------
Net increase (decrease) in net assets resulting
from operations ................................... (85,559) 1,320,654 2,898,655 (773,922) 1,253,128 2,476,782
---------- ---------- ---------- ---------- ---------- ----------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income:
A Class ........................................... (1,406,694) (989,212) (1,597,868) (1,225,917) (714,960) (1,033,966)
B Class ........................................... (43,161) (25,072) (37,856) (261,267) (162,152) (224,133)
C Class ........................................... (5,944) (1,123) (1,691) (53,212) (18,634) (17,078)
Net realized gain on investments:
A Class ........................................... (110,320) -- -- -- -- --
B Class ........................................... (3,890) -- -- -- -- --
C Class ........................................... (110) -- -- -- -- --
---------- ---------- ---------- ---------- ---------- ----------
(1,570,119) (1,015,407) (1,637,415) (1,540,396) (895,746) (1,275,177)
---------- ---------- ---------- ---------- ---------- ----------
CAPITAL SHARE TRANSACTIONS:
Proceeds from shares sold:
A Class ........................................... 1,440,696 965,629 751,084 7,214,292 4,019,856 3,728,179
B Class ........................................... 208,846 80,892 192,597 2,756,229 561,598 1,626,102
C Class ........................................... 304,077 -- -- 722,342 507,769 164,876
Net asset value of shares issued upon reinvestment
of distributions from net investment income and
net realized gain on investments:
A Class ........................................... 910,805 599,011 1,047,157 734,060 433,739 616,492
B Class ........................................... 26,551 13,030 22,504 141,931 101,024 152,794
C Class ........................................... 5,787 1,125 1,714 39,399 13,324 11,587
---------- ---------- ---------- ---------- ---------- ----------
2,896,762 1,659,687 2,015,056 11,608,253 5,637,310 6,300,030
---------- ---------- ---------- ---------- ---------- ----------
Cost of shares repurchased:
A Class ........................................... (4,235,735) (2,329,708) (5,770,655) (3,023,459) (2,465,216) (4,116,579)
B Class ........................................... (107,320) (11,781) (61,932) (441,663) (1,179,572) (326,601)
C Class ........................................... (1,454) (12,711) (3,000) (54,713) (68,006) (25,157)
---------- ---------- ---------- ---------- ---------- ----------
(4,344,509) (2,354,200) (5,835,587) (3,519,835) (3,712,794) (4,468,337)
---------- ---------- ---------- ---------- ---------- ----------
Increase (decrease) in net assets derived from
capital share transactions ........................ (1,447,747) (694,513) (3,820,531) 8,088,418 1,924,516 1,831,693
---------- ---------- ---------- ---------- ---------- ----------
NET INCREASE (DECREASE) IN NET ASSETS ................ (3,103,425) (389,266) (2,559,291) 5,774,100 2,281,898 3,033,298
NET ASSETS:
Beginning of period .................................. 31,505,567 31,894,833 34,454,124 31,346,335 29,064,437 26,031,139
---------- ---------- ---------- ---------- ---------- ----------
End of period ........................................$28,402,142 $31,505,567 $31,894,833 $37,120,435 $31,346,335 $29,064,437
=========== =========== =========== =========== =========== ===========
</TABLE>
See accompanying notes
<PAGE>
for tax-exempt income 35
STATEMENTS OF CHANGES IN NET ASSETS (CONTINUED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
VOYAGEUR MUTUAL FUNDS, INC.
TAX-FREE WISCONSIN FUND
---------------------------------------
YEAR ENDED EIGHT MONTHS YEAR ENDED
8/31/99 ENDED 8/31/98 12/31/97
<S> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS:
Net investment income ............................ $ 1,773,222 $1,099,088 $ 1,402,926
Net realized gain (loss) on investments .......... (13,496) (55,924) 190,944
Net change in unrealized appreciation/depreciation
of investments ................................. (2,175,827) 352,874 1,023,956
----------- ----------- -------------
Net increase (decrease) in net assets resulting
from operations ................................. (416,101) 1,396,038 2,617,826
----------- ----------- -------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income:
A Class ....................................... (1,605,902) (1,011,692) (1,354,012)
B Class ....................................... (112,132) (58,302) (65,438)
C Class ....................................... (55,188) (29,094) (26,356)
Net realized gain on investments:
A Class ....................................... -- -- --
B Class ....................................... -- -- --
C Class ....................................... -- -- --
----------- ----------- -------------
(1,773,222) (1,099,088) (1,445,806)
----------- ----------- -------------
CAPITAL SHARE TRANSACTIONS:
Proceeds from shares sold:
A Class ....................................... 4,882,591 5,662,446 7,121,843
B Class ....................................... 1,147,384 955,955 505,833
C Class ....................................... 554,885 657,033 347,276
Net asset value of shares issued upon reinvestment
of distributions from net investment income and
net realized gain on investments:
A Class ....................................... 905,575 515,403 758,408
B Class ....................................... 67,376 33,882 42,097
C Class ....................................... 48,880 25,500 24,405
----------- ----------- -------------
7,606,691 7,850,219 8,799,862
----------- ----------- -------------
Cost of shares repurchased:
A Class ....................................... (4,934,768) (2,836,280) (6,376,585)
B Class ....................................... (457,430) (318,684) (20,571)
C Class ....................................... (292,994) (98,592) (262,082)
----------- ----------- -------------
(5,685,192) (3,253,556) (6,659,238)
----------- ----------- -------------
Increase (decrease) in net assets derived from
capital share transactions ...................... 1,921,499 4,596,663 2,140,624
----------- ----------- -------------
NET INCREASE (DECREASE) IN NET ASSETS (267,824) 4,893,613 3,312,644
----------- ----------- -------------
Net Assets:
Beginning of period .............................. 38,392,887 33,499,274 30,186,630
----------- ----------- -------------
End of period .................................... $38,125,063 $ 38,392,887 $ 33,499,274
=========== ============ =============
</TABLE>
See accompanying notes
<PAGE>
36 for tax-exempt income
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
Selected data for each share of the Fund outstanding throughout each period were
as follows:
<TABLE>
<CAPTION>
VOYAGEUR MUTUAL FUNDS, INC.
TAX-FREE IDAHO FUND - CLASS A
----------------------------------------------------------
EIGHT PERIOD
YEAR MONTHS YEAR YEAR 1/4/95(3)
ENDED ENDED ENDED ENDED TO
8/31/99 8/31/98(1) 12/31/97(2) 12/31/96 12/31/95
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period $11.560 $11.450 $10.910 $11.020 $10.000
Income (loss) from investment operations:
Net investment income ......................... 0.517 0.356 0.551 0.580 0.600
Net realized and unrealized gain (loss)
on investments ............................... (0.620) 0.115 0.552 (0.120) 1.100
-------- -------- -------- -------- --------
Total from investment operations .............. (0.103) 0.471 1.103 0.460 1.700
-------- -------- -------- -------- --------
Less dividends and distributions:
Dividends from net investment income .......... (0.517) (0.356) (0.563) (0.570) (0.600)
Distributions from net realized gain on
investments ................................. -- (0.005) -- -- (0.080)
-------- -------- -------- -------- --------
Total dividends and distributions ............. (0.517) (0.361) (0.563) (0.570) (0.680)
-------- -------- -------- -------- --------
Net asset value, end of period ................... $10.940 $11.560 $11.450 $10.910 $11.020
======== ======== ======== ======== ========
Total return(4) .................................. (0.99%) 4.19% 10.41% 4.36% 17.48%
Ratios and supplemental data:
Net assets, end of period (000 omitted) ....... $44,299 $39,843 $33,788 $27,684 $13,540
Ratio of expenses to average net assets ....... 1.00% 0.95% 0.87% 0.60% 0.26%(5)
Ratio of expenses to average net assets
prior to expense limitation and expenses
paid indirectly .............................. 1.04% 1.02% 1.02% 1.10% 1.25%(5)
Ratio of net investment income to average
net assets ................................... 4.52% 4.65% 4.98% 5.29% 5.24%(5)
Ratio of net investment income to average
net assets prior to expense limitation
and expenses paid indirectly ................. 4.48% 4.58% 4.83% 4.79% 4.25%(5)
Portfolio turnover ............................ 2% 8% 19% 35% 42%
</TABLE>
- ----------------------
1 Ratios have been annualized and total return has not been annualized.
2 Commencing May 1, 1997, Delaware Management Company replaced Voyageur Fund
Managers, Inc. as the Fund's investment manager.
3 Commencement of operations.
4 Total investment return is based on the change in net asset value of a share
during the period and assumes reinvestment of distributions at net asset value
and does not reflect the impact of a sales charge.
5 Annualized.
See accompanying notes
<PAGE>
for tax-exempt income 37
FINANCIAL HIGHLIGHTS (CONTINUED)
- --------------------------------------------------------------------------------
Selected data for each share of the Fund outstanding throughout each period were
as follows:
<TABLE>
<CAPTION>
VOYAGEUR MUTUAL FUNDS, INC.
TAX-FREE IDAHO FUND - CLASS B
--------------------------------------------------------------
EIGHT PERIOD
YEAR MONTHS YEAR YEAR 3/16/95(3)
ENDED ENDED ENDED ENDED TO
8/31/99 8/31/98(1) 12/31/97(2) 12/31/96 12/31/95
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period ............. $11.550 $11.440 $10.890 $11.010 $10.500
Income (loss) from investment operations:
Net investment income ......................... 0.432 0.298 0.487 0.520 0.420
Net realized and unrealized gain (loss) on
investments ................................. (0.630) 0.117 0.560 (0.130) 0.590
-------- -------- -------- -------- --------
Total from investment operations .............. (0.198) 0.415 1.047 0.390 1.010
-------- -------- -------- -------- --------
Less dividends and distributions:
Dividends from net investment income .......... (0.432) (0.300) (0.497) (0.510) (0.420)
Distributions from net realized gain on
investments ................................. -- (0.005) -- -- (0.080)
-------- -------- -------- -------- --------
Total dividends and distributions ............. (0.432) (0.305) (0.497) (0.510) (0.500)
-------- -------- -------- -------- --------
Net asset value, end of period ................... $10.920 $11.550 $11.440 $10.890 $11.010
======== ======== ======== ======== ========
Total return(4) .................................. (1.82%) 3.68% 9.87% 3.75% 9.86%
Ratios and supplemental data:
Net assets, end of period (000 omitted) ....... $10,199 $7,474 $6,827 $4,945 $1,977
Ratio of expenses to average net assets ....... 1.75% 1.70% 1.46% 1.11% 0.79%(5)
Ratio of expenses to average net assets
prior to expense limitation and expenses
paid indirectly ............................. 1.79% 1.77% 1.61% 1.85% 1.90%(5)
Ratio of net investment income to average net
assets ...................................... 3.77% 3.90% 4.39% 4.78% 4.68%(5)
Ratio of net investment income to average net
assets prior to expense limitation and
expenses paid indirectly .................... 3.73% 3.83% 4.24% 4.04% 3.57%(5)
Portfolio turnover ............................ 2% 8% 19% 35% 42%
</TABLE>
- ----------------------
1 Ratios have been annualized and total return has not been annualized.
2 Commencing May 1, 1997, Delaware Management Company replaced Voyageur Fund
Managers, Inc. as the Fund's investment manager.
3 Commencement of operations.
4 Total investment return is based on the change in net asset value of a share
during the period and assumes reinvestment of distributions at net asset value
and does not reflect the impact of a sales charge.
5 Annualized.
See accompanying notes
<PAGE>
38 for tax-exempt income
FINANCIAL HIGHLIGHTS (CONTINUED)
- --------------------------------------------------------------------------------
Selected data for each share of the Fund outstanding throughout each period were
as follows:
<TABLE>
<CAPTION>
VOYAGEUR MUTUAL FUNDS, INC.
TAX-FREE IDAHO FUND - CLASS C
-------------------------------------------------------------
EIGHT PERIOD
YEAR MONTHS YEAR YEAR 1/11/95(3)
ENDED ENDED ENDED ENDED TO
8/31/99 8/31/98(1) 12/31/97(2) 12/31/96 12/31/95
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period $11.550 $11.430 $10.900 $11.020 $10.040
Income (loss) from investment operations:
Net investment income ............................. 0.432 0.302 0.459 0.500 0.500
Net realized and unrealized gain (loss) on
investments ..................................... (0.630) 0.123 0.549 (0.130) 1.060
-------- -------- -------- -------- ----------
Total from investment operations .................. (0.198) 0.425 1.008 0.370 1.560
-------- -------- -------- -------- ----------
Less dividends and distributions:
Dividends from net investment income .............. (0.432) (0.300) (0.478) (0.490) (0.500)
Distributions from net realized gain on
investments ..................................... -- (0.005) -- -- (0.080)
-------- -------- -------- -------- --------
Total dividends and distributions ................. (0.432) (0.305) (0.478) (0.490) (0.580)
-------- -------- -------- -------- --------
Net asset value, end of period ....................... $10.920 $11.550 $11.430 $10.900 $11.020
======== ======== ======== ======= ========
Total return(4) ...................................... (1.82%) 3.77% 9.49% 3.48% 15.81%
Ratios and supplemental data:
Net assets, end of period (000 omitted) ........... $3,411 $1,719 $1,125 $822 $789
Ratio of expenses to average net assets ........... 1.75% 1.70% 1.62% 1.33% 1.05%(5)
Ratio of expenses to average net assets prior
to expense limitation and expenses paid
indirectly ...................................... 1.79% 1.77% 1.77% 1.82% 2.00%(5)
Ratio of net investment income to average
net assets ...................................... 3.77% 3.90% 4.23% 4.57% 4.48%(5)
Ratio of net investment income to average
net assets prior to expense limitation and
expenses paid indirectly ........................ 3.73% 3.83% 4.08% 4.08% 3.53%(5)
Portfolio turnover ................................ 2% 8% 19% 35% 42%
</TABLE>
- ----------------------
1 Ratios have been annualized and total return has not been annualized.
2 Commencing May 1, 1997, Delaware Management Company replaced Voyageur Fund
Managers, Inc. as the Fund's investment manager.
3 Commencement of operations.
4 Total investment return is based on the change in net asset value of a share
during the period and assumes reinvestment of distributions at net asset value
and does not reflect the impact of a sales charge.
5 Annualized.
See accompanying notes
<PAGE>
for tax-exempt income 39
FINANCIAL HIGHLIGHTS (CONTINUED)
- --------------------------------------------------------------------------------
Selected data for each share of the Fund outstanding throughout each period were
as follows:
<TABLE>
<CAPTION>
VOYAGEUR MUTUAL FUNDS, INC.
TAX-FREE IOWA FUND - CLASS A
----------------------------------------------------------------------
EIGHT FOUR
YEAR MONTHS YEAR YEAR YEAR MONTHS
ENDED ENDED ENDED ENDED ENDED ENDED
8/31/99 8/31/98(1) 12/31/97(2) 12/31/96 12/31/95 12/31/94
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period .................. $10.160 $10.060 $9.620 $9.830 $8.560 $9.260
Income (loss) from investment operations:
Net investment income .............................. 0.440 0.294 0.449 0.440 0.450 0.170
Net realized and unrealized gain (loss)
on investments .................................... (0.460) 0.100 0.440 (0.210) 1.290 (0.720)
-------- -------- --------- -------- -------- --------
Total from investment operations ................... (0.020) 0.394 0.889 0.230 1.740 (0.550)
-------- -------- --------- -------- -------- --------
Less dividends:
Dividends from net investment income ............... (0.440) (0.294) (0.449) (0.440) (0.470) (0.150)
-------- -------- --------- -------- -------- --------
Total dividends .................................... (0.440) (0.294) (0.449) (0.440) (0.470) (0.150)
-------- -------- --------- -------- -------- --------
Net asset value, end of period ........................ $9.700 $10.160 $10.060 $9.620 $9.830 $8.560
======== ======== ======== ======== ======== ========
Total return(3)........................................ (0.26%) 3.98% 9.49% 2.56% 20.80% (5.86%)
Ratios and supplemental data:
Net assets, end of period (000 omitted) ............ $37,807 $39,345 $38,343 $40,037 $42,374 $32,373
Ratio of expenses to average net assets ............ 1.00% 0.96% 0.91% 0.92% 0.72% 0.11%(4)
Ratio of expenses to average net assets prior
to expense limitation and expenses paid
indirectly ....................................... 1.08% 1.06% 0.97% 1.06% 1.06% 1.25%(4)
Ratio of net investment income to average
net assets ....................................... 4.36% 4.38% 4.62% 4.68% 4.88% 5.71%(4)
Ratio of net investment income to average
net assets prior to expense limitation and
expenses paid indirectly ......................... 4.28% 4.28% 4.56% 4.54% 4.54% 4.57%(4)
Portfolio turnover ................................. 2% 13% 14% 14% 21% 7%
</TABLE>
- ----------------------
1 Ratios have been annualized and total return has not been annualized.
2 Commencing May 1, 1997, Delaware Management Company replaced Voyageur Fund
Managers, Inc. as the Fund's investment manager.
3 Total investment return is based on the change in net asset value of a share
during the period and assumes reinvestment of distributions at net asset value
and does not reflect the impact of a sales charge.
4 Annualized.
See accompanying notes
<PAGE>
40 for tax-exempt income
FINANCIAL HIGHLIGHTS (CONTINUED)
- --------------------------------------------------------------------------------
Selected data for each share of the Fund outstanding throughout each period were
as follows:
<TABLE>
<CAPTION>
VOYAGEUR MUTUAL FUNDS, INC.
TAX-FREE IOWA FUND - CLASS B
-------------------------------------------------------------
EIGHT PERIOD
YEAR MONTHS YEAR YEAR 3/24/95(3)
ENDED ENDED ENDED ENDED TO
8/31/99 8/31/98(1) 12/31/97(2) 12/31/96 12/31/95
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period ........................... $10.160 $10.060 $9.610 $9.830 $9.180
Income (loss) from investment operations:
Net investment income ....................................... 0.363 0.243 0.366 0.380 0.310
Net realized and unrealized gain (loss) on investments ...... (0.460) 0.100 0.457 (0.220) 0.640
-------- -------- -------- -------- --------
Total from investment operations ............................ (0.097) 0.343 0.823 0.160 0.950
-------- -------- -------- -------- --------
Less dividends:
Dividends from net investment income ........................ (0.363) (0.243) (0.373) (0.380) (0.300)
-------- -------- -------- -------- --------
Total dividends ............................................. (0.363) (0.243) (0.373) (0.380) (0.300)
-------- -------- -------- -------- --------
Net asset value, end of period ................................. $9.700 $10.160 $10.060 $9.610 $9.830
======== ======== ======== ======== ========
Total return(4) ................................................ (1.03%) 3.46% 8.75% 1.76% 10.62%
Ratios and supplemental data:
Net assets, end of period (000 omitted) ..................... $4,600 $3,910 $2,910 $1,645 $819
Ratio of expenses to average net assets ..................... 1.75% 1.71% 1.67% 1.61% 1.28%(5)
Ratio of expenses to average net assets prior to
expense limitation and expenses paid indirectly ........... 1.83% 1.81% 1.73% 1.81% 1.65%(5)
Ratio of net investment income to average net assets ........ 3.61% 3.63% 3.86% 3.97% 4.06%(5)
Ratio of net investment income to average net assets
prior to expense limitation and expenses paid indirectly .. 3.53% 3.53% 3.80% 3.77% 3.69%(5)
Portfolio turnover .......................................... 2% 13% 14% 14% 21%
</TABLE>
- --------------------
(1) Ratios have been annualized and total return has not been annualized.
(2) Commencing May 1, 1997, Delaware Management Company replaced Voyageur Fund
Managers, Inc. as the Fund's investment manager.
(3) Commencement of operations.
(4) Total investment return is based on the change in net asset value of a share
during the period and assumes reinvestment of distributions at net asset
value and does not reflect the impact of a sales charge.
(5) Annualized.
See accompanying notes
<PAGE>
for tax-exempt income 41
FINANCIAL HIGHLIGHTS (CONTINUED)
- --------------------------------------------------------------------------------
Selected data for each share of the Fund outstanding throughout each period were
as follows:
<TABLE>
<CAPTION>
VOYAGEUR MUTUAL FUNDS, INC.
TAX-FREE IOWA FUND - CLASS C
-------------------------------------------------------------
EIGHT PERIOD
YEAR MONTHS YEAR YEAR 1/4/95(3)
ENDED ENDED ENDED ENDED TO
8/31/99 8/31/98(1) 12/31/97(2) 12/31/96 12/31/95
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period ............................ $10.160 $10.060 $9.610 $9.830 $8.550
Income (loss) from investment operations:
Net investment income ........................................ 0.363 0.243 0.360 0.360 0.370
Net realized and unrealized gain (loss) on investments ....... (0.460) 0.100 0.456 (0.220) 1.280
-------- -------- -------- -------- --------
Total from investment operations ............................. (0.097) 0.343 0.816 0.140 1.650
-------- -------- -------- -------- --------
Less dividends:
Dividends from net investment income ......................... (0.363) (0.243) (0.366) (0.360) (0.370)
-------- -------- -------- -------- --------
Total dividends .............................................. (0.363) (0.243) (0.366) (0.360) (0.370)
-------- -------- -------- -------- --------
Net asset value, end of period .................................. $9.700 $10.160 $10.060 $9.610 $9.830
======== ======== ======== ======== ========
Total return(4) ................................................. (1.03%) 3.46% 8.68% 1.56% 19.66%
Ratios and supplemental data:
Net assets, end of period (000 omitted) ...................... $1,296 $1,225 $871 $670 $462
Ratio of expenses to average net assets ...................... 1.75% 1.71% 1.74% 1.75% 1.61%(5)
Ratio of expenses to average net assets prior to
expense limitation and expenses paid indirectly ............ 1.83% 1.81% 1.80% 1.81% 1.72%(5)
Ratio of net investment income to average net assets ......... 3.61% 3.63% 3.79% 3.82% 3.74%(5)
Ratio of net investment income to average net assets .........
prior to expense limitation and expenses paid indirectly ... 3.53% 3.53% 3.73% 3.76% 3.63%(5)
Portfolio turnover 2% 13% 14% 14% 21%
</TABLE>
- ----------------------
(1) Ratios have been annualized and total return has not been annualized.
(2) Commencing May 1, 1997, Delaware Management Company replaced Voyageur Fund
Managers, Inc. as the Fund's investment manager.
(3) Commencement of operations.
(4) Total investment return is based on the change in net asset value of a share
during the period and assumes reinvestment of distributions at net asset
value and does not reflect the impact of a sales charge.
(5) Annualized.
See accompanying notes
<PAGE>
42 for tax-exempt income
FINANCIAL HIGHLIGHTS (CONTINUED)
- --------------------------------------------------------------------------------
Selected data for each share of the Fund outstanding throughout each period were
as follows:
<TABLE>
<CAPTION>
VOYAGEUR INVESTMENT TRUST
TAX-FREE KANSAS FUND - CLASS A
---------------------------------------------------------------------------------
EIGHT TWO
YEAR MONTHS YEAR YEAR YEAR MONTHS YEAR
ENDED ENDED ENDED ENDED ENDED ENDED ENDED
8/31/99 8/31/98(1) 12/31/97(2) 2/31/96 12/31/95 12/31/94 10/31/94
<S> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period ........... $11.160 $11.060 $10.560 $10.730 $9.500 $9.630 $10.850
Income (loss) from investment operations:
Net investment income ....................... 0.538 0.351 0.526 0.520 0.560 0.090 0.570
Net realized and unrealized gain (loss)
on investments ............................ (0.491) 0.100 0.506 (0.170) 1.220 (0.130) (1.210)
------- ------- ------- ------- ------- ------ ------
Total from investment operations ............ 0.047 0.451 1.032 0.350 1.780 (0.040) (0.640)
------- ------- ------- ------- ------- ------ ------
Less dividends and distributions:
Dividends from net investment income ........ (0.534) (0.351) (0.532) (0.520) (0.550) (0.090) (0.570)
Distributions from net realized gain
on investments ............................ (0.033) -- -- -- -- -- (0.010)
------- ------- ------- ------- ------- ------ ------
Total dividends and distributions ........... (0.567) (0.351) (0.532) (0.520) (0.550) (0.090) (0.580)
------- ------- ------- ------- ------- ------ ------
Net asset value, end of period ................. $10.640 $11.160 $11.060 $10.560 $10.730 $9.500 $9.630
======= ======= ======= ======= ======= ====== ======
Total return(3) ................................ 0.35% 4.14% 10.06% 3.43% 19.13% (0.38%) (6.10%)
Ratios and supplemental data:
Net assets, end of period (000 omitted) ..... $11,498 $12,548 $10,663 $10,176 $10,677 $7,355 $6,469
Ratio of expenses to average net assets ..... 0.98% 0.89% 0.84% 0.83% 0.37% 0.01%(4) 0.06%
Ratio of expenses to average net assets
prior to expense limitation and expenses
paid indirectly ........................... 1.06% 0.99% 1.03% 1.21% 1.11% 1.25%(4) 1.25%
Ratio of net investment income to
average net assets ........................ 4.86% 4.75% 4.92% 4.97% 5.32% 5.88%(4) 5.30%
Ratio of net investment income to average
net assets prior to expense
limitation and expenses paid indirectly ... 4.78% 4.65% 4.73% 4.59% 4.58% 4.64%(4) 4.11%
Portfolio turnover .......................... 28% 40% 30% 56% 19% 0% 38%
</TABLE>
- ----------------------
(1) Ratios have been annualized and total return has not been annualized.
(2) Commencing May 1, 1997, Delaware Management Company replaced Voyageur Fund
Managers, Inc. as the Fund's investment manager.
(3) Total investment return is based on the change in net asset value of a share
during the period and assumes reinvestment of distributions at net asset
value and does not reflect the impact of a sales charge.
(4) Annualized.
See accompanying notes
<PAGE>
for tax-exempt income 43
FINANCIAL HIGHLIGHTS (CONTINUED)
- --------------------------------------------------------------------------------
Selected data for each share of the Fund outstanding throughout each period were
as follows:
<TABLE>
<CAPTION>
VOYAGEUR INVESTMENT TRUST
TAX-FREE KANSAS FUND - CLASS B
-----------------------------------------------------------------
YEAR EIGHT MONTHS YEAR YEAR PERIOD
ENDED ENDED ENDED ENDED 4/8/95(3) TO
8/31/99 8/31/98(1) 12/31/97(2) 12/31/96 12/31/95
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period ........................... $11.180 $11.080 $10.570 $10.740 $10.190
Income (loss) from investment operations:
Net investment income ....................................... 0.455 0.296 0.440 0.450 0.340
Net realized and unrealized gain (loss) on investments ...... (0.501) 0.099 0.516 (0.170) 0.540
-------- -------- -------- -------- --------
Total from investment operations ............................ (0.046) 0.395 0.956 0.280 0.880
-------- -------- -------- -------- --------
Less dividends and distributions:
Dividends from net investment income ........................ (0.451) (0.295) (0.446) (0.450) (0.330)
Distributions from net realized gain on investments ......... (0.033) -- -- -- --
-------- -------- -------- -------- --------
Total dividends and distributions ........................... (0.484) (0.295) (0.446) (0.450) (0.330)
-------- -------- -------- -------- --------
Net asset value, end of period ................................. $10.650 $11.180 $11.080 $10.570 $10.740
======== ======== ======== ======== ========
Total return(4) ................................................ (0.49%) 3.62% 9.28% 2.69% 8.76%
Ratios and supplemental data:
Net assets, end of period (000 omitted) ..................... $4,910 $3,694 $3,452 $2,402 $677
Ratio of expenses to average net assets ..................... 1.73% 1.64% 1.61% 1.61% 0.94%(5)
Ratio of expenses to average net assets prior to
expense limitation and expenses paid indirectly ........... 1.81% 1.74% 1.80% 2.00% 1.68%(5)
Ratio of net investment income to average net assets ........ 4.11% 4.00% 4.15% 4.16% 4.63%(5)
Ratio of net investment income to average net assets
prior to expense limitation and expenses paid indirectly .. 4.03% 3.90% 3.96% 3.77% 3.89%(5)
Portfolio turnover .......................................... 28% 40% 30% 56% 19%
</TABLE>
- ----------------------
(1) Ratios have been annualized and total return has not been annualized.
(2) Commencing May 1, 1997, Delaware Management Company replaced Voyageur Fund
Managers, Inc. as the Fund's investment manager.
(3) Commencement of operations.
(4) Total investment return is based on the change in net asset value of a share
during the period and assumes reinvestment of distributions at net asset
value and does not reflect the impact of a sales charge.
(5) Annualized.
See accompanying notes
<PAGE>
44 for tax-exempt income
FINANCIAL HIGHLIGHTS (CONTINUED)
- --------------------------------------------------------------------------------
Selected data for each share of the Fund outstanding throughout each period were
as follows:
<TABLE>
<CAPTION>
VOYAGEUR INVESTMENT TRUST
TAX-FREE KANSAS FUND - CLASS C
YEAR EIGHT MONTHS YEAR YEAR PERIOD
ENDED ENDED ENDED ENDED 4/12/95(3) TO
8/31/99 8/31/98(1) 12/31/97(2) 12/31/96 12/31/95
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period .......................... $11.160 $11.050 $10.550 $10.720 $10.200
Income (loss) from investment operations:
Net investment income ...................................... 0.453 0.296 0.439 0.430 0.320
Net realized and unrealized gain (loss) on investments ..... (0.490) 0.110 0.504 (0.170) 0.510
-------- -------- -------- -------- --------
Total from investment operations ........................... (0.037) 0.406 0.943 0.260 0.830
-------- -------- -------- -------- --------
Less dividends and distributions:
Dividends from net investment income ....................... (0.450) (0.296) (0.443) (0.430) (0.310)
Distributions from net realized gain on investments ........ (0.033) -- -- -- --
-------- -------- -------- -------- --------
Total dividends and distributions .......................... (0.483) (0.296) (0.443) (0.430) (0.310)
-------- -------- -------- -------- --------
Net asset value, end of period ................................ $10.640 $11.160 $11.050 $10.550 $10.720
======== ======== ======== ======== ========
Total return(4) ............................................... (0.40%) 3.72% 9.17% 2.52% 8.29%
Ratios and supplemental data:
Net assets, end of period (000 omitted) .................... $458 $127 $108 $90 $40
Ratio of expenses to average net assets .................... 1.73% 1.64% 1.64% 1.77% 1.27%(5)
Ratio of expenses to average net assets prior to
expense limitation and expenses paid indirectly .......... 1.81% 1.74% 1.83% 2.00% 1.79%(5)
Ratio of net investment income to average net assets ....... 4.11% 4.00% 4.12% 4.02% 4.21%(5)
Ratio of net investment income to average net assets
prior to expense limitation and expenses paid indirectly . 4.03% 3.90% 3.93% 3.79% 3.69%(5)
Portfolio turnover ......................................... 28% 40% 30% 56% 19%
</TABLE>
- ----------------------
(1) Ratios have been annualized and total return has not been annualized.
(2) Commencing May 1, 1997, Delaware Management Company replaced Voyageur Fund
Managers, Inc. as the Fund's investment manager.
(3) Commencement of operations.
(4) Total investment return is based on the change in net asset value of a share
during the period and assumes reinvestment of distributions at net asset
value and does not reflect the impact of a sales charge.
(5) Annualized.
See accompanying notes
<PAGE>
for tax-exempt income 45
FINANCIAL HIGHLIGHTS (CONTINUED)
- --------------------------------------------------------------------------------
Selected data for each share of the Fund outstanding throughout each period were
as follows:
<TABLE>
<CAPTION>
VOYAGEUR INVESTMENT TRUST
TAX-FREE MISSOURI INSURED FUND - CLASS A
---------------------------------------------------------------------------
EIGHT TWO
YEAR MONTHS YEAR YEAR YEAR MONTHS YEAR
ENDED ENDED ENDED ENDED ENDED ENDED ENDED
8/31/99 8/31/98(1) 12/31/97(2) 12/31/96 12/31/95 12/31/94 10/31/94
<S> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period .................... $10.870 $10.810 $10.370 $10.540 $9.270 $9.370 $10.820
Income (loss) from investment operations:
Net investment income ................................ 0.498 0.333 0.504 0.520 0.520 0.100 0.550
Net realized and unrealized gain (loss)
on investments ..................................... (0.530) 0.060 0.446 (0.180) 1.290 (0.110) (1.430)
------- ------- ------- ------- ------- ------ ------
Total from investment operations ..................... (0.032) 0.393 0.950 0.340 1.810 (0.010) (0.880)
------- ------- ------- ------- ------- ------ ------
Less dividends and distributions:
Dividends from net investment income ................. (0.498) (0.333) (0.510) (0.510) (0.540) (0.090) (0.540)
Distributions from net realized gain
on investments ..................................... -- -- -- -- -- -- (0.030)
------- ------- ------- ------- ------- ------ ------
Total dividends and distributions .................... (0.498) (0.333) (0.510) (0.510) (0.540) (0.090) (0.570)
------- ------- ------- ------- ------- ------ ------
Net asset value, end of period .......................... $10.340 $10.870 $10.810 $10.370 $10.540 $9.270 $9.370
======= ======= ======= ======= ======= ====== ======
Total return(3).......................................... (0.38%) 3.70% 9.43% 3.41% 19.96% (0.07%) (8.28%)
Ratios and supplemental data:
Net assets, end of period (000 omitted) .............. $42,337 $46,939 $48,565 $49,301 $50,211 $37,790 $37,384
Ratio of expenses to average net assets .............. 0.97% 0.92% 0.91% 0.71% 0.50% 0.11%(4) 0.15%
Ratio of expenses to average net assets prior to
expense limitation and expenses
paid indirectly .................................... 1.02% 1.02% 0.93% 1.03% 1.07% 1.12%(4) 1.13%
Ratio of net investment income to average net assets . 4.62% 4.64% 4.81% 5.05% 5.25% 6.00%(4) 5.39%
Ratio of net investment income to average net assets
prior to expense limitation and
expenses paid indirectly ........................... 4.57% 4.54% 4.79% 4.73% 4.68% 4.99%(4) 4.41%
Portfolio turnover ................................... 7% 18% 12% 28% 31% 8% 32%
</TABLE>
- ----------------------
(1) Ratios have been annualized and total return has not been annualized.
(2) Commencing May 1, 1997, Delaware Management Company replaced Voyageur Fund
Managers, Inc. as the Fund's investment manager.
(3) Total investment return is based on the change in net asset value of a share
during the period and assumes reinvestment of distributions at net asset
value and does not reflect the impact of a sales charge.
(4) Annualized.
See accompanying notes
<PAGE>
46 for tax-exempt income
FINANCIAL HIGHLIGHTS (CONTINUED)
- --------------------------------------------------------------------------------
Selected data for each share of the Fund outstanding throughout each period were
as follows:
<TABLE>
<CAPTION>
VOYAGEUR INVESTMENT TRUST
TAX-FREE MISSOURI INSURED FUND - CLASS B
--------------------------------------------------------------------------
EIGHT TWO PERIOD
YEAR MONTHS YEAR YEAR YEAR MONTHS 3/12/94(3)
ENDED ENDED ENDED ENDED ENDED ENDED TO
8/31/99 8/31/98(1) 12/31/97(2) 12/31/96 12/31/95 12/31/94 10/31/94
<S> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period .................... $10.870 $10.810 $10.370 $10.540 $9.270 $9.370 $10.300
Income (loss) from investment operations:
Net investment income ................................ 0.416 0.279 0.425 0.460 0.480 0.080 0.330
Net realized and unrealized gain (loss)
on investments ..................................... (0.530) 0.060 0.451 (0.180) 1.280 (0.100) (0.940)
------- ------- ------- ------- ------- ------ ------
Total from investment operations ..................... (0.114) 0.339 0.876 0.280 1.760 (0.020) (0.610)
------- ------- ------- ------- ------- ------ ------
Less dividends:
Dividends from net investment income ................. (0.416) (0.279) (0.436) (0.450) (0.490) (0.080) (0.320)
------- ------- ------- ------- ------- ------ ------
Total dividends ...................................... (0.416) (0.279) (0.436) (0.450) (0.490) (0.080) (0.320)
------- ------- ------- ------- ------- ------ ------
Net asset value, end of period .......................... $10.340 $10.870 $10.810 $10.370 $10.540 $9.270 $9.370
======= ======= ======= ======= ======= ====== ======
Total return(4) ......................................... (1.13%) 3.19% 8.66% 2.93% 19.18% (0.14%) (6.16%)
Ratios and supplemental data:
Net assets, end of period (000 omitted) .............. $10,572 $11,317 $11,507 $10,432 $6,195 $2,742 $1,701
Ratio of expenses to average net assets .............. 1.72% 1.67% 1.61% 1.29% 0.97% 0.60%(5) 0.49%(5)
Ratio of expenses to average net assets prior
to expense limitation and expenses
paid indirectly .................................... 1.77% 1.77% 1.63% 1.78% 1.81% 1.84%(5) 1.83%(5)
Ratio of net investment income to average net assets . 3.87% 3.89% 4.11% 4.46% 4.70% 5.32%(5) 4.89%(5)
Ratio of net investment income to average net assets
prior to expense limitation and
expenses paid indirectly ............................. 3.82% 3.79% 4.09% 3.97% 3.86% 4.08%(5) 3.55%(5)
Portfolio turnover ................................... 7% 18% 12% 28% 31% 8% 32%
</TABLE>
- ----------------------
(1) Ratios have been annualized and total return has not been annualized.
(2) Commencing May 1, 1997, Delaware Management Company replaced Voyageur Fund
Managers, Inc. as the Fund's investment manager.
(3) Commencement of operations.
(4) Total investment return is based on the change in net asset value of a share
during the period and assumes reinvestment of distributions at net asset
value and does not reflect the impact of a sales charge.
(5) Annualized.
See accompanying notes
<PAGE>
for tax-exempt income 47
FINANCIAL HIGHLIGHTS (CONTINUED)
- --------------------------------------------------------------------------------
Selected data for each share of the Fund outstanding throughout each period were
as follows:
<TABLE>
<CAPTION>
VOYAGEUR INVESTMENT TRUST
TAX-FREE MISSOURI INSURED FUND - CLASS C
-------------------------------------------------------------
EIGHT PERIOD
YEAR MONTHS YEAR YEAR 11/11/95(3)
ENDED ENDED ENDED ENDED TO
8/31/99 8/31/98(1) 12/31/97(2) 12/31/96 12/31/95
-------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period ....................... $10.880 $10.810 $10.370 $10.540 $10.360
Income (loss) from investment operations:
Net investment income ................................... 0.419 0.279 0.405 0.430 0.060
Net realized and unrealized gain (loss) on investments .. (0.530) 0.070 0.455 (0.180) 0.170
------- ------- ------- ------- -------
Total from investment operations ........................ (0.111) 0.349 0.860 0.250 0.230
------- ------- ------- ------- -------
Less dividends:
Dividends from net investment income .................... (0.419) (0.279) (0.420) (0.420) (0.050)
------- ------- ------- ------- -------
Total dividends ......................................... (0.419) (0.279) (0.420) (0.420) (0.050)
------- ------- ------- ------- -------
Net asset value, end of period ............................. $10.350 $10.880 $10.810 $10.370 $10.540
======= ======= ======= ======= =======
Total return(4)............................................. (1.12%) 3.28% 8.49% 2.48% 2.24%
Ratios and supplemental data:
Net assets, end of period (000 omitted) ................. $231 $112 $225 $152 $20
Ratio of expenses to average net assets ................. 1.72% 1.67% 1.74% 1.62% 1.22%(5)
Ratio of expenses to average net assets prior to
expense limitation and expenses paid indirectly ....... 1.77% 1.77% 1.76% 1.78% 1.55%(5)
Ratio of net investment income to average net assets .... 3.87% 3.89% 3.98% 4.10% 4.09%(5)
Ratio of net investment income to average net assets
prior to expense limitation and expenses paid
indirectly ............................................ 3.82% 3.79% 3.96% 3.94% 3.76%5
Portfolio turnover ...................................... 7% 18% 12% 28% 31%
</TABLE>
- ----------------------
(1) Ratios have been annualized and total return has not been annualized.
(2) Commencing May 1, 1997, Delaware Management Company replaced Voyageur Fund
Managers, Inc. as the Fund's investment manager.
(3) Commencement of operations.
(4) Total investment return is based on the change in net asset value of a share
during the period and assumes reinvestment of distributions at net asset
value and does not reflect the impact of a sales charge.
(5) Annualized.
See accompanying notes
<PAGE>
48 for tax-exempt income
FINANCIAL HIGHLIGHTS (CONTINUED)
- --------------------------------------------------------------------------------
Selected data for each share of the Fund outstanding throughout each period were
as follows:
<TABLE>
<CAPTION>
VOYAGEUR TAX-FREE FUNDS, INC.
TAX-FREE NORTH DAKOTA FUND - CLASS A
----------------------------------------------------------------------
YEAR EIGHT MONTHS YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED ENDED ENDED
8/31/99 8/31/98(1) 12/31/97(2) 12/31/96 12/31/95 12/31/94
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period ........................ $11.440 $11.320 $10.880 $11.000 $9.850 $11.070
Income (loss) from investment operations:
Net investment income .................................... 0.541 0.364 0.546 0.540 0.540 0.560
Net realized and unrealized gain (loss) on investments ... (0.578) 0.120 0.451 (0.130) 1.180 (1.150)
------- ------- ------- ------- ------- ------
Total from investment operations ......................... (0.037) 0.484 0.997 0.410 1.720 (0.590)
------- ------- ------- ------- ------- ------
Less dividends and distributions:
Dividends from net investment income ..................... (0.541) (0.364) (0.557) (0.530) (0.570) (0.530)
Distributions from net realized gain on investments ...... (0.042) -- -- -- -- (0.080)
Distributions in excess of net realized gains ............ -- -- -- -- -- (0.020)
------- ------- ------- ------- ------- ------
Total dividends and distributions ........................ (0.583) (0.364) (0.557) (0.530) (0.570) (0.630)
------- ------- ------- ------- ------- ------
Net asset value, end of period .............................. $10.820 $11.440 $11.320 $10.880 $11.000 $9.850
======= ======= ======= ======= ======= ======
Total return(3) ............................................. (0.41%) 4.35% 9.43% 3.89% 17.81% (5.47%)
Ratios and supplemental data:
Net assets, end of period (000 omitted) .................. $27,032 $30,496 $30,965 $33,713 $36,096 $33,829
Ratio of expenses to average net assets .................. 1.00% 1.00% 1.00% 0.88% 0.81% 0.46%
Ratio of expenses to average net assets prior
to expense limitation and expenses paid indirectly ..... 1.04% 1.15% 1.04% 1.08% 1.05% 1.14%
Ratio of net investment income to average net assets ..... 4.79% 4.82% 4.97% 5.01% 5.07% 5.36%
Ratio of net investment income to average net assets
prior to expense limitation and expenses
paid indirectly .......................................... 4.75% 4.67% 4.93% 4.81% 4.83% 4.68%
Portfolio turnover ....................................... 28% 23% 41% 58% 45% 33%
</TABLE>
- ----------------------
(1) Ratios have been annualized and total return has not been annualized.
(2) Commencing May 1, 1997, Delaware Management Company replaced Voyageur Fund
Managers, Inc. as the Fund's investment manager.
(3) Total investment return is based on the change in net asset value of a share
during the period and assumes reinvestment of distributions at net asset
value and does not reflect the impact of a sales charge.
See accompanying notes
<PAGE>
for tax-exempt income 49
FINANCIAL HIGHLIGHTS (CONTINUED)
- --------------------------------------------------------------------------------
Selected data for each share of the Fund outstanding throughout each period were
as follows:
<TABLE>
<CAPTION>
VOYAGEUR TAX-FREE FUNDS, INC.
TAX-FREE NORTH DAKOTA FUND - CLASS B
----------------------------------------------------------------------
EIGHT PERIOD FROM
YEAR MONTHS YEAR YEAR YEAR 5/10/94(3)
ENDED ENDED ENDED ENDED ENDED TO
8/31/99 8/31/98(1) 12/31/97(2) 12/31/96 12/31/95 12/31/94
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period ..................... $11.440 $11.320 $10.880 $11.000 $9.850 $10.310
Income (loss) from investment operations:
Net investment income ................................. 0.457 0.308 0.484 0.490 0.480 0.300
Net realized and unrealized gain (loss) on investments. (0.578) 0.119 0.451 (0.130) 1.180 (0.390)
------- ------- ------- ------- ------- ------
Total from investment operations ...................... (0.121) 0.427 0.935 0.360 1.660 (0.090)
------- ------- ------- ------- ------- ------
Less dividends and distributions:
Dividends from net investment income .................. (0.457) (0.307) (0.495) (0.480) (0.510) (0.270)
Distributions from net realized gain on investments ... (0.042) -- -- -- -- (0.080)
Distributions in excess of net realized gains ......... -- -- -- -- -- (0.020)
------- ------- ------- ------- ------- ------
Total dividends and distributions ..................... (0.499) (0.307) (0.495) (0.480) (0.510) (0.370)
------- ------- ------- ------- ------- ------
Net asset value, end of period ........................... $10.820 $11.440 $11.320 $10.880 $11.000 $9.850
======= ======= ======= ======= ======= ======
Total return(4) .......................................... (1.14%) 3.83% 8.82% 3.39% 17.24% (0.77%)
Ratios and supplemental data:
Net assets, end of period (000 omitted) ............... $1,048 $980 $889 $700 $375 $144
Ratio of expenses to average net assets ............... 1.75% 1.75% 1.55% 1.36% 1.29% 0.99%(5)
Ratio of expenses to average net assets prior
to expense limitation and expenses paid indirectly .. 1.79% 1.90% 1.59% 1.83% 1.79% 1.89%(5)
Ratio of net investment income to average net assets .. 4.04% 4.07% 4.42% 4.52% 4.56% 4.97%(5)
Ratio of net investment income to average net assets
prior to expense limitation and expenses
paid indirectly ..................................... 4.00% 3.92% 4.38% 4.05% 4.06% 4.07%(5)
Portfolio turnover .................................... 28% 23% 41% 58% 45% 33%
</TABLE>
- ----------------------
(1) Ratios have been annualized and total return has not been annualized.
(2) Commencing May 1, 1997, Delaware Management Company replaced Voyageur Fund
Managers, Inc. as the Fund's investment manager.
(3) Commencement of operations.
(4) Total investment return is based on the change in net asset value of a share
during the period and assumes reinvestment of distributions at net asset
value and does not reflect the impact of a sales charge.
(5) Annualized.
See accompanying notes
<PAGE>
50 for tax-exempt income
FINANCIAL HIGHLIGHTS (CONTINUED)
- --------------------------------------------------------------------------------
Selected data for each share of the Fund outstanding throughout each period were
as follows:
<TABLE>
<CAPTION>
VOYAGEUR TAX-FREE FUNDS, INC.
TAX-FREE NORTH DAKOTA FUND - CLASS C
------------------------------------------------------------
EIGHT PERIOD FROM
YEAR MONTHS YEAR YEAR 7/29/95(3)
ENDED ENDED ENDED ENDED TO
8/31/99 8/31/98(1) 12/31/97(2) 12/31/96 12/31/95
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period ........................ $11.430 $11.320 $10.870 $11.000 $10.510
Income (loss) from investment operations:
Net investment income .................................... 0.456 0.307 0.441 0.440 0.170
Net realized and unrealized gain (loss) on investments ... (0.578) 0.110 0.468 (0.140) 0.500
------- ------- ------- ------- -------
Total from investment operations ......................... (0.122) 0.417 0.909 0.300 0.670
------- ------- ------- ------- -------
Less dividends and distributions:
Dividends from net investment income ..................... (0.456) (0.307) (0.459) (0.430) (0.180)
Distributions from net realized gain on investments ...... (0.042) -- -- -- --
Distributions in excess of net realized gains ............ -- -- -- -- --
------- ------- ------- ------- -------
Total dividends and distributions ........................ (0.498) (0.307) (0.459) (0.430) (0.180)
------- ------- ------- ------- -------
Net asset value, end of period .............................. $10.810 $11.430 $11.320 $10.870 $11.000
======= ======= ======= ======= =======
Total return(4) ............................................. (1.15%) 3.74% 8.57% 2.81% 6.47%
Ratios and supplemental data:
Net assets, end of period (000 omitted) .................. $322 $30 $41 $40 $20
Ratio of expenses to average net assets .................. 1.75% 1.75% 1.87% 1.75% 1.73%(5)
Ratio of expenses to average net assets prior
to expense limitation and expenses paid indirectly ..... 1.79% 1.90% 1.91% 1.75% 1.73%(5)
Ratio of net investment income to average net assets ..... 4.04% 4.07% 4.10% 4.06% 4.00%(5)
Ratio of net investment income to average net assets
prior to expense limitation and expenses paid indirectly 4.00% 3.92% 4.06% 4.06% 4.00%(5)
Portfolio turnover ....................................... 28% 23% 41% 58% 45%
</TABLE>
- ----------------------
(1) Ratios have been annualized and total return has not been annualized.
(2) Commencing May 1, 1997, Delaware Management Company replaced Voyageur Fund
Managers, Inc. as the Fund's investment manager.
(3) Commencement of operations.
(4) Total investment return is based on the change in net asset value of a share
during the period and assumes reinvestment of distributions at net asset
value and does not reflect the impact of a sales charge.
(5) Annualized.
See accompanying notes
<PAGE>
for tax-exempt income 51
FINANCIAL HIGHLIGHTS (CONTINUED)
- --------------------------------------------------------------------------------
Selected data for each share of the Fund outstanding throughout each period were
as follows:
<TABLE>
<CAPTION>
VOYAGEUR INVESTMENT TRUST
TAX-FREE OREGON INSURED FUND - CLASS A
-----------------------------------------------------------------------------------
YEAR EIGHT MONTHS YEAR YEAR YEAR TWO MONTHS YEAR
ENDED ENDED ENDED ENDED ENDED ENDED ENDED
8/31/99 8/31/98(1) 12/31/97(2) 12/31/96 12/31/95 12/31/94 10/31/94
<S> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period ......... $10.430 $10.310 $ 9.870 $10.050 $ 8.920 $ 9.000 $10.240
Income (loss) from investment operations:
Net investment income ....................... 0.458 0.320 0.481 0.480 0.490 0.090 0.500
Net realized and unrealized gain (loss)
on investments ............................ (0.620) 0.120 0.444 (0.180) 1.140 (0.090) (1.240)
------- ------- ------- ------- ------- ------- -------
Total from investment operations ............ (0.162) 0.440 0.925 0.300 1.630 0.000 (0.740)
------- ------- ------- ------- ------- ------- -------
Less dividends:
Dividends from net investment income ........ (0.458) (0.320) (0.485) (0.480) (0.500) (0.080) (0.500)
------- ------- ------- ------- ------- ------- -------
Total dividends ............................. (0.458) (0.320) (0.485) (0.480) (0.500) (0.080) (0.500)
------- ------- ------- ------- ------- ------- -------
Net asset value, end of period ............... $ 9.810 $10.430 $10.310 $ 9.870 $10.050 $ 8.920 $ 9.000
======= ======= ======= ======= ======= ======= =======
Total return(3) .............................. (1.67%) 4.33% 9.66% 3.15% 18.71% 0.06% (7.35%)
Ratios and supplemental data:
Net assets, end of period (000 omitted) ..... $27,518 $24,336 $22,071 $20,913 $21,590 $14,650 $14,086
Ratio of expenses to average net assets ..... 0.80% 0.71% 0.71% 0.71% 0.54% 0.05%(4) 0.03%
Ratio of expenses to average net assets .....
prior to expense limitation and expenses
paid indirectly ........................... 1.02% 1.03% 0.94% 1.07% 1.11% 1.25%(4) 1.25%
Ratio of net investment income to average
net assets ................................ 4.44% 4.64% 4.83% 4.92% 5.12% 5.79%(4) 5.17%
Ratio of net investment income to average
net assets prior to expense limitation
and expenses paid indirectly ............. 4.22% 4.32% 4.60% 4.56% 4.55% 4.59%(4) 3.95%
Portfolio turnover .......................... 10% 5% 5% 40% 41% 5% 49%
</TABLE>
- ----------------------
(1) Ratios have been annualized and total return has not been annualized.
(2) Commencing May 1, 1997, Delaware Management Company replaced Voyageur Fund
Managers, Inc. as the Fund's investment manager.
(3) Total investment return is based on the change in net asset value of a share
during the period and assumes reinvestment of distributions at net asset
value and does not reflect the impact of a sales charge.
(4) Annualized.
See accompanying notes
<PAGE>
52 for tax-exempt income
FINANCIAL HIGHLIGHTS (CONTINUED)
- --------------------------------------------------------------------------------
Selected data for each share of the Fund outstanding throughout each period were
as follows:
<TABLE>
<CAPTION>
VOYAGEUR INVESTMENT TRUST
TAX-FREE OREGON INSURED FUND - CLASS B
-----------------------------------------------------------------------------------
PERIOD
YEAR EIGHT MONTHS YEAR YEAR YEAR TWO MONTHS 3/12/94(3)
ENDED ENDED ENDED ENDED ENDED ENDED TO
8/31/99 8/31/98(1) 12/31/97(2) 12/31/96 12/31/95 12/31/94 10/31/94
<S> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period......... $10.430 $10.310 $ 9.870 $10.050 $ 8.920 $9.000 $9.850
Income (loss) from investment operations:
Net investment income ...................... 0.381 0.268 0.422 0.430 0.440 0.080 0.270
Net realized and unrealized gain (loss)
on investments............................. (0.620) 0.120 0.434 (0.180) 1.140 (0.090) (0.850)
------- ------- ------ ------- ------ ------ ------
Total from investment operations ........... (0.239) 0.388 0.856 0.250 1.580 (0.010) (0.580)
------- ------- ------ ------- ------ ------ ------
Less dividends:
Dividends from net investment income........ (0.381) (0.268) (0.416) (0.430) (0.450) (0.070) (0.270)
------- ------- ------ ------- ------ ------ ------
Total dividends............................. (0.381) (0.268) (0.416) (0.430) (0.450) (0.070) (0.270)
------- ------- ------ ------- ------ ------ ------
Net asset value, end of period............... $ 9.810 $10.430 $10.310 $ 9.870 $10.050 $8.920 $9.000
======= ======= ======= ======= ======= ====== ======
Total return(4).............................. (2.41%) 3.82% 8.90% 2.61% 18.10% 0.03% (5.95%)
Ratios and supplemental data:
Net assets, end of period (000 omitted)..... $7,999 $6,011 $6,461 $4,758 $2,786 $1,303 $1,146
Ratio of expenses to average net assets..... 1.55% 1.46% 1.39% 1.25% 1.04% 0.60%(5) 5 0.75%(5)
Ratio of expenses to average net assets
prior to expense limitation and expenses
paid indirectly ........................... 1.77% 1.78% 1.62% 1.83% 1.86% 2.00%(5) 2.00%(5)
Ratio of net investment income to average
net assets................................. 3.69% 3.89% 4.15% 4.37% 4.57% 5.19%(5) 4.43%(5)
Ratio of net investment income to average
net assets prior to expense limitation and
expenses paid indirectly .................. 3.47% 3.57% 3.92% 3.79% 3.75% 3.79%(5) 3.18%(5)
Portfolio turnover.......................... 10% 5% 5% 40% 41% 5% 49%
</TABLE>
- ----------------------
(1) Ratios have been annualized and total return has not been annualized.
(2) Commencing May 1, 1997, Delaware Management Company replaced Voyageur Fund
Managers, Inc. as the Fund's investment manager.
(3) Commencement of operations.
(4) Total investment return is based on the change in net asset value of a share
during the period and assumes reinvestment of distributions at net asset
value and does not reflect the impact of a sales charge.
(5) Annualized.
See accompanying notes
<PAGE>
for tax-exempt income 53
FINANCIAL HIGHLIGHTS (CONTINUED)
- --------------------------------------------------------------------------------
Selected data for each share of the Fund outstanding throughout each period were
as follows:
<TABLE>
<CAPTION>
VOYAGEUR INVESTMENT TRUST
TAX-FREE OREGON INSURED FUND - CLASS C
---------------------------------------------------------------
PERIOD
YEAR EIGHT MONTHS YEAR YEAR 7/7/95(3)
ENDED ENDED ENDED ENDED TO
8/31/99 8/31/98(1) 12/31/97(2) 12/31/96 12/31/95
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period ........................... $10.440 $10.320 $ 9.880 $10.050 $ 9.630
Income (loss) from investment operations:
Net investment income ......................................... 0.380 0.268 0.411 0.400 0.190
Net realized and unrealized gain (loss) on investments ........ (0.620) 0.120 0.431 (0.170) 0.410
------- ------- ------- ------- -------
Total from investment operations .............................. (0.240) 0.388 0.842 0.230 0.600
------- ------- ------- ------- -------
Less dividends:
Dividends from net investment income .......................... (0.380) (0.268) (0.402) (0.400) (0.180)
------- ------- ------- ------- -------
Total dividends ............................................... (0.380) (0.268) (0.402) (0.400) (0.180)
------- ------- ------- ------- -------
Net asset value, end of period ................................. $ 9.820 $10.440 $10.320 $ 9.880 $10.050
======= ======= ======= ======= =======
Total return(4)................................................. (2.41%) 3.81% 8.75% 2.38% 6.35%
Ratios and supplemental data:
Net assets, end of period (000 omitted)........................ $1,603 $999 $532 $360 $250
Ratio of expenses to average net assets........................ 1.55% 1.46% 1.51% 1.55% 1.39%(5)
Ratio of expenses to average net assets prior to expense
limitation and expenses paid indirectly....................... 1.77% 1.78% 1.74% 1.82% 1.74%(5)
Ratio of net investment income to average net assets........... 3.69% 3.89% 4.03% 4.03% 4.00%(5)
Ratio of net investment income to average net assets prior
to expense limitation and expenses paid indirectly ........... 3.47% 3.57% 3.80% 3.76% 3.65%(5)
Portfolio turnover............................................. 10% 5% 5% 40% 41%
</TABLE>
- ----------------------
(1) Ratios have been annualized and total return has not been annualized.
(2) Commencing May 1, 1997, Delaware Management Company replaced Voyageur Fund
Managers, Inc. as the Fund's investment manager.
(3) Commencement of operations.
(4) Total investment return is based on the change in net asset value of a share
during the period and assumes reinvestment of distributions at net asset
value and does not reflect the impact of a sales charge.
(5) Annualized.
See accompanying notes
<PAGE>
54 for tax-exempt income
FINANCIAL HIGHLIGHTS (CONTINUED)
- --------------------------------------------------------------------------------
Selected data for each share of the Fund outstanding throughout each period were
as follows:
<TABLE>
<CAPTION>
VOYAGEUR MUTUAL FUNDS, INC.
TAX-FREE WISCONSIN FUND - CLASS A
-----------------------------------------------------------------------
YEAR EIGHT MONTHS YEAR YEAR YEAR FOUR MONTHS
ENDED ENDED ENDED ENDED ENDED ENDED
8/31/99 8/31/98(1) 12/31/97(2) 12/31/96 12/31/95 12/31/94
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period.................... $10.080 $10.010 $ 9.640 $9.780 $8.740 $9.280
Income (loss) from investment operations:
Net investment income ................................. 0.452 0.304 0.466 0.460 0.480 0.160
Net realized and unrealized gain (loss) on investments. (0.530) 0.070 0.383 (0.140) 1.040 (0.550)
------- ------- ------- ------ ------ ------
Total from investment operations ...................... (0.078) 0.374 0.849 0.320 1.520 (0.390)
------- ------- ------- ------ ------ ------
Less dividends:
Dividends from net investment income................... (0.452) (0.304) (0.479) (0.460) (0.480) (0.150)
------- ------- ------- ------ ------ ------
Total dividends........................................ (0.452) (0.304) (0.479) (0.460) (0.480) (0.150)
------- ------- ------- ------ ------ ------
Net asset value, end of period.......................... $ 9.550 $10.080 $10.010 $9.640 $9.780 $8.740
======= ======= ======= ====== ====== ======
Total return(3)......................................... (0.87%) 3.80% 9.07% 3.49% 17.74% (4.12%)
Ratios and supplemental data:
Net assets, end of period (000 omitted)................ $33,410 $34,489 $30,879 $28,292 $26,449 $20,167
Ratio of expenses to average net assets................ 1.00% 1.00% 0.99% 0.98% 0.88% 0.08%(4)
Ratio of expenses to average net assets prior to
expense limitation and expenses paid indirectly...... 1.03% 1.04% 1.07% 1.09% 1.09% 1.25%(4)
Ratio of net investment income to average net assets... 4.54% 4.56% 4.76% 4.90% 5.05% 5.54%(4)
Ratio of net investment income to average net assets
prior to expense limitation and expenses paid
indirectly............................................ 4.51% 4.52% 4.68% 4.79% 4.84% 4.37%(4)
Portfolio turnover..................................... 6% 16% 30% 38% 12% 20%
</TABLE>
- ----------------------
(1) Ratios have been annualized and total return has not been annualized.
(2) Commencing May 1, 1997, Delaware Management Company replaced Voyageur Fund
Managers, Inc. as the Fund's investment manager.
(3) Total investment return is based on the change in net asset value of a share
during the period and assumes reinvestment of distributions at net asset
value and does not reflect the impact of a sales charge.
(4) Annualized.
See accompanying notes
<PAGE>
for tax-exempt income 55
FINANCIAL HIGHLIGHTS (CONTINUED)
- --------------------------------------------------------------------------------
Selected data for each share of the Fund outstanding throughout each period were
as follows:
<TABLE>
<CAPTION>
VOYAGEUR MUTUAL FUNDS, INC.
TAX-FREE WISCONSIN FUND - CLASS B
----------------------------------------------------------
PERIOD
YEAR EIGHT MONTHS YEAR YEAR 4/22/95(3)
ENDED ENDED ENDED ENDED TO
8/31/99 8/31/98(1) 12/31/97(2) 12/31/96 12/31/95
<S> <C> <C> <C> <C>
Net asset value, beginning of period ............................... $10.070 $10.000 $ 9.630 $9.770 $9.390
Income (loss) from investment operations:
Net investment income ............................................. 0.378 0.255 0.395 0.410 0.280
Net realized and unrealized gain (loss) on investments............. (0.530) 0.070 0.382 (0.140) 0.370
------- ------- ------- ------ ------
Total from investment operations .................................. (0.152) 0.325 0.777 0.270 0.650
------- ------- ------- ------ ------
Less dividends:
Dividends from net investment income............................... (0.378) (0.255) (0.407) (0.410) (0.270)
------- ------- ------- ------ ------
Total dividends ................................................... (0.378) (0.255) (0.407) (0.410) (0.270)
------- ------- ------- ------ ------
Net asset value, end of period...................................... $ 9.540 $10.070 $10.000 $9.630 $9.770
======= ======= ======= ====== ======
Total return(4)..................................................... (1.60%) 3.29% 8.27% 2.84% 7.08%
Ratios and supplemental data:
Net assets, end of period (000 omitted)............................ $3,206 $2,621 $1,931 $1,339 $725
Ratio of expenses to average net assets ........................... 1.75% 1.75% 1.72% 1.66% 1.45%(5)
Ratio of expenses to average net assets prior to expense
limitation and expenses paid indirectly .......................... 1.78% 1.79% 1.80% 1.85% 1.70%(5)
Ratio of net investment income to average net assets............... 3.79% 3.81% 4.03% 4.37% 4.31%(5)
Ratio of net investment income to average net assets
prior to expense limitation and expenses paid indirectly ......... 3.76% 3.77% 3.95% 4.18% 4.06%(5)
Portfolio turnover................................................. 6% 16% 30% 38% 12%
</TABLE>
- ----------------------
(1) Ratios have been annualized and total return has not been annualized.
(2) Commencing May 1, 1997, Delaware Management Company replaced Voyageur Fund
Managers, Inc. as the Fund's investment manager.
(3) Commencement of operations.
(4) Total investment return is based on the change in net asset value of a share
during the period and assumes reinvestment of distributions at net asset
value and does not reflect the impact of a sales charge.
(5) Annualized.
See accompanying notes
<PAGE>
56 for tax-exempt income
FINANCIAL HIGHLIGHTS (CONTINUED)
- --------------------------------------------------------------------------------
Selected data for each share of the Fund outstanding throughout each period were
as follows:
<TABLE>
<CAPTION>
VOYAGEUR MUTUAL FUNDS, INC.
TAX-FREE WISCONSIN FUND - CLASS C
-----------------------------------------------------------
PERIOD
YEAR EIGHT MONTHS YEAR YEAR 3/28/95(3)
ENDED ENDED ENDED ENDED TO
8/31/99 8/31/98(1) 12/31/97(2) 12/31/96 12/31/95
<S> <C> <C> <C> <C>
Net asset value, beginning of period................................ $10.110 $10.030 $ 9.660 $9.790 $9.340
Income (loss) from investment operations:
Net investment income ............................................. 0.377 0.259 0.380 0.390 0.300
Net realized and unrealized gain (loss) on investments ............ (0.540) 0.075 0.390 (0.130) 0.440
------- ------- ------- ------ ------
Total from investment operations................................... (0.163) 0.334 0.770 0.260 0.740
------- ------- ------- ------ ------
Less dividends:
Dividends from net investment income............................... (0.377) (0.254) (0.400) (0.390) (0.290)
------- ------- ------- ------ ------
Total dividends ................................................... (0.377) (0.254) (0.400) (0.390) (0.290)
------- ------- ------- ------ ------
Net asset value, end of period ..................................... $ 9.570 $10.110 $10.030 $9.660 $9.790
======= ======= ======= ====== ======
Total return(4)..................................................... (1.70%) 3.38% 8.16% 2.74% 8.06%
Ratios and supplemental data:
Net assets, end of period (000 omitted)............................ $1,509 $1,283 $689 $555 $73
Ratio of expenses to average net assets ........................... 1.75% 1.75% 1.81% 1.75% 1.77%(5)
Ratio of expenses to average net assets prior to expense
limitation and expenses paid indirectly .......................... 1.78% 1.79% 1.89% 1.83% 1.77%(5)
Ratio of net investment income to average net assets............... 3.79% 3.81% 3.94% 4.12% 4.04%(5)
Ratio of net investment income to average net assets
prior to expense limitation and expenses paid indirectly.......... 3.76% 3.77% 3.86% 4.04% 4.04%(5)
Portfolio turnover................................................. 6% 16% 30% 38% 12%
</TABLE>
- ----------------------
(1) Ratios have been annualized and total return has not been annualized.
(2) Commencing May 1, 1997, Delaware Management Company replaced Voyageur Fund
Managers, Inc. as the Fund's investment manager.
(3) Commencement of operations.
(4) Total investment return is based on the change in net asset value of a share
during the period and assumes reinvestment of distributions at net asset
value and does not reflect the impact of a sales charge.
(5) Annualized.
See accompanying notes
<PAGE>
for tax-exempt income 57
NOTES TO FINANCIAL STATEMENTS
AUGUST 31, 1999
- --------------------------------------------------------------------------------
Delaware Tax-Free Kansas Fund ("Tax-Free Kansas Fund"), Delaware Tax-Free
Missouri Insured Fund ("Tax-Free Missouri Insured Fund"), and Delaware Tax-Free
Oregon Insured Fund ("Tax-Free Oregon Insured Fund"), series within the Voyageur
Investment Trust, Delaware Tax-Free Idaho Fund ("Tax-Free Idaho Fund"), Delaware
Tax-Free Iowa Fund ("Tax-Free Iowa Fund"), and Delaware Tax-Free Wisconsin Fund
("Tax-Free Wisconsin Fund"), series within the Voyageur Mutual Funds, Inc., and
Delaware Tax-Free North Dakota Fund ("Tax-Free North Dakota Fund"), a series
within the Voyageur Tax-Free Funds, Inc. (each referred to as a "Fund" or
collectively as the "Funds") are registered as non-diversified, open-end
management investment companies under the Investment Company Act of 1940 (as
amended). The Funds offer three classes of shares. The A Class carries a
front-end sales charge of 3.75%. The B Class carries a back-end deferred sales
charge and the C Class carries a level load deferred sales charge.
The Tax-Free Idaho Fund, Tax-Free Iowa Fund, Tax-Free North Dakota Fund, and
Tax-Free Wisconsin Fund seek high current income free from both federal and
state income taxes by investing in investment grade municipal bonds. The
Tax-Free Missouri Insured Fund and Tax-Free Oregon Insured Fund seek high
current income free from both federal and state income taxes with the added
safety of an insured portfolio by investing in insured municipal bonds. The
Tax-Free Kansas Fund seeks high current income free from both federal and state
income taxes and local intangibles tax by investing in investment grade
municipal bonds.
1. Significant Accounting Policies
The following accounting policies are in accordance with generally accepted
accounting principles and are consistently followed by the Funds.
Security Valuation - Long-term debt securities are valued by an independent
pricing service and such prices are believed to reflect the fair value of such
securities. Money market instruments having less than 60 days to maturity are
valued at amortized cost which approximates market value. Other securities and
assets for which market quotations are not readily available are valued at fair
value as determined in good faith by or under the direction of the Funds' Board
of Directors.
Federal Income Taxes - Each Fund intends to continue to qualify as a regulated
investment company and make the requisite distributions to shareholders.
Accordingly, no provision for federal income taxes has been made in the
financial statements. Income and capital gain distributions are determined in
accordance with federal income tax regulations which may differ from generally
accepted accounting principles.
Class Accounting - Investment income, common expenses and realized and
unrealized gain (loss) on investments are allocated to the various classes of
the Funds on the basis of daily net assets of each class. Distribution expenses
relating to a specific class are charged directly to that class.
Use of Estimates - The preparation of 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 at
the date of the financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ from those
estimates.
<PAGE>
Other - Expenses common to all funds within the Delaware Investments Family of
Funds are allocated amongst the funds on the basis of average net assets.
Security transactions are recorded on the date the securities are purchased or
sold (trade date). Costs used in calculating realized gains and losses on the
sale of investment securities are those of the specific securities sold.
Interest income is recorded on the accrual basis. Original issue discounts and
market premium are amortized to interest income over the lives of the respective
securities. The Funds declare dividends from net investment income daily and pay
such dividends monthly. Capital gains, if any, are distributed annually.
Certain expenses of the Funds are paid through "soft dollar" arrangements with
brokers. These transactions are done subject to best price and execution. The
expenses paid under the above arrangement are included in their respective
expense captions on the Statement of Operations with the corresponding expenses
offset shown as "expenses paid indirectly". The amount of these expenses for the
year ended August 31, 1999 are as follows:
"SOFT DOLLAR"
EXPENSES
-------------
Tax-Free Idaho Fund .............................. $1,246
Tax-Free Iowa Fund ............................... 1.041
Tax-Free Kansas Fund ............................. 394
Tax-Free Missouri Insured Fund ................... 1,287
Tax-Free North Dakota Fund ....................... 703
Tax-Free Oregon Insured Fund ..................... 833
Tax-Free Wisconsin Fund .......................... 916
2. Investment Management and Other Transactions with Affiliates
Commencing January 1, 1999, and in accordance with the terms of the Investment
Management Agreement, the Tax-Free Missouri Insured Fund and the Tax-Free Oregon
Insured Fund pay Delaware Management Company ("DMC"), the Investment Manager of
the Funds, an annual fee which is calculated at the rate of 0.50% on the first
$500 million of average daily net assets of the funds, 0.475% on the next $500
million, 0.45% on the next $1,500 million and 0.425% on the average daily net
assets in excess of $2,500 million. Commencing April 15, 1999, with the
exception of the Tax-Free Kansas Fund which commenced January 1, 1999, the
Tax-Free Idaho Fund, Tax-Free Iowa Fund, Tax-Free Kansas Fund, Tax-Free North
Dakota Fund, and Tax-Free Wisconsin Fund pay DMC an annual fee which is
calculated at the rate of 0.55% on the first $500 million of average daily net
assets of the funds, 0.500% on the next $500 million , 0.45% on the next $1,500
million and 0.425% on the average daily net assets in excess of $2,500 million.
Prior to January 1, 1999 and April 15, 1999, respectively, all of the Funds paid
DMC an annual fee which was calculated at the rate of 0.50% of the average daily
net assets.
DMC has elected to waive its fees and reimburse each Fund to the extent that
annual operating expenses, exclusive of taxes, interest, brokerage commissions,
distribution fees, and extraordinary expenses, exceed the following percentages
of average daily net assets through December 31, 1999:
<PAGE>
58 for tax-exempt income
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
- --------------------------------------------------------------------------------
2. Investment Management and Other Transactions with Affiliates (Continued)
OPERATING
EXPENSE LIMITATION
AS A PERCENTAGE
OF AVERAGE DAILY
NET ASSETS
(PER ANNUM)
-----------------
Tax-Free Idaho Fund ................................... 0.75%
Tax-Free Iowa Fund .................................... 0.75%
Tax-Free Kansas Fund .................................. 0.75%
Tax-Free Missouri Insured Fund ........................ N/A*
Tax-Free North Dakota Fund ............................ N/A**
Tax-Free Oregon Insured Fund .......................... 0.60%***
Tax-Free Wisconsin Fund ............................... 0.75%
- ----------------------
* For the period September 1, 1998 through December 31, 1998, and the period
January 1, 1999 through June 30, 1999 the expense limitation for Tax-Free
Missouri Insured Fund was 0.66% and 0.75% respectively.
** Prior to July 1, 1999, the expense limitation for Tax-Free North Dakota Fund
was 0.75%.
*** Prior to January 1, 1999, the expense limitation for Tax-Free Oregon Insured
Fund was 0.46%.
The Funds have engaged Delaware Service Company, Inc. ("DSC"), an affiliate of
DMC, to provide dividend disbursing, transfer agent and accounting and
administrative services. Each Fund pays DSC a monthly fee based on number of
shareholder accounts, shareholder transactions and average net assets, subject
to certain minimums.
On August 31, 1999, the Funds had payables to affiliates as follows:
DIVIDEND
DISBURSING,
TRANSFER
AGENT FEES,
INVESTMENT ACCOUNTING SERVICES
MANAGEMENT AND OTHER OTHER EXPENSES
FEES PAYABLE EXPENSES PAYABLE TO DMC
TO DMC PAYABLE TO DSC AND AFFILIATES
-----------------------------------------------
Tax-Free Idaho Fund ............ -- $6,372 $23,657
Tax-Free Iowa Fund ............. $22,838 6,288 15,434
Tax-Free Kansas Fund ........... -- 2,479 5,751
Tax-Free Missouri Insured Fund . 16,483 6,876 18,003
Tax-Free North Dakota Fund ..... 17,043 3,986 11,966
Tax-Free Oregon Insured Fund ... 8,719 4,554 14,783
Tax-Free Wisconsin Fund ........ 15,418 4,659 13,485
<PAGE>
Pursuant to the Distribution Agreement, the Funds pay Delaware Distributors,
L.P. ("DDLP"), the Distributor and an affiliate of DMC, an annual fee not to
exceed 0.25% of the average daily net assets of the A Class and 1.00% of the
average daily net assets of the B and C Class.
For the year ended August 31, 1999, commissions earned by DDLP on sales of the
Funds' A Class shares were as follows:
Tax-Free Idaho Fund .................................... $33,170
Tax-Free Iowa Fund ..................................... 11,921
Tax-Free Kansas Fund ................................... 8,529
Tax-Free Missouri Insured Fund ......................... 3,518
Tax-Free North Dakota Fund ............................. 2,978
Tax-Free Oregon Insured Fund ........................... 24,691
Tax-Free Wisconsin Fund ................................ 15,344
Certain officers of DMC, DSC and DDLP are officers, directors and/or employees
of the Funds. These officers, directors and employees are paid no compensation
by the Funds.
3. Investments
During the year ended August 31, 1999, the Funds made purchases and sales of
investment securities other than U.S. government securities and temporary cash
investments as follows:
Purchases Sales
------------------------
Tax-Free Idaho Fund .............................. $9,787,624 $827,055
Tax-Free Iowa Fund ............................... 3,165,714 949,386
Tax-Free Kansas Fund ............................. 4,274,033 5,178,644
Tax-Free Missouri Insured Fund ................... 3,691,867 6,852,049
Tax-Free North Dakota Fund ....................... 8,492,337 10,448,764
Tax-Free Oregon Insured Fund ..................... 10,191,273 3,585,888
Tax-Free Wisconsin Fund .......................... 5,095,430 2,343,073
<PAGE>
for tax-exempt income 59
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
- --------------------------------------------------------------------------------
3. Investments (Continued)
At August 31, 1999, the aggregate cost of securities and unrealized appreciation
(depreciation) for federal income tax purposes for each Fund were as follows:
<TABLE>
<CAPTION>
AGGREGATE AGGREGATE AGGREGATE NET UNREALIZED
COST OF UNREALIZED UNREALIZED APPRECIATION
INVESTMENTS APPRECIATION DEPRECIATION (DEPRECIATION)
-----------------------------------------------------
<S> <C> <C> <C> <C>
Tax-Free Idaho Fund ............................ $57,339,521 $1,095,779 ($1,272,109) ($176,330)
Tax-Free Iowa Fund ............................. 42,734,514 1,597,657 (579,077) 1,018,580
Tax-Free Kansas Fund ........................... 15,471,683 582,838 (218,131) 364,707
Tax-Free Missouri Insured Fund ................. 50,484,553 2,179,229 (349,282) 1,829,947
Tax-Free North Dakota Fund ..................... 27,007,679 902,711 (325,395) 577,316
Tax-Free Oregon Insured Fund ................... 36,201,298 1,219,914 (976,692) 243,222
Tax-Free Wisconsin Fund ........................ 38,531,219 1,035,356 (883,119) 152,237
</TABLE>
For federal income tax purposes, each Fund had accumulated capital losses at
August 31, 1999 as follows:
<TABLE>
<CAPTION>
YEAR OF YEAR OF YEAR OF YEAR OF YEAR OF YEAR OF YEAR OF
EXPIRATION EXPIRATION EXPIRATION EXPIRATION EXPIRATION EXPIRATION EXPIRATION
2001 2002 2003 2004 2005 2006 2007 TOTAL
-----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Tax-Free Idaho Fund .............. -- -- -- -- -- $44,632 -- $44,632
Tax-Free Iowa Fund ............... $950,762 $18,853 $368,235 $168,308 $117,934 -- -- 1,624,092
Tax-Free Missouri Insured Fund ... -- -- 209,612 525,264 -- -- -- 734,876
Tax-Free Oregon Insured Fund ..... -- 215,801 158,365 218,468 -- -- -- 592,634
Tax-Free Wisconsin Fund .......... -- 128,938 64,926 229,647 -- -- 53,540 477,051
</TABLE>
4. Capital Stock
Transactions in capital stock shares were as follows:
<TABLE>
<CAPTION>
TAX-FREE IDAHO FUND TAX-FREE IOWA FUND
-----------------------------------------------------------------------
YEAR EIGHT MONTHS YEAR YEAR EIGHT MONTHS YEAR
ENDED ENDED ENDED ENDED ENDED ENDED
8/31/99 8/31/98 12/31/97 8/31/99 8/31/98 12/31/97
<S> <C> <C> <C> <C> <C> <C>
Shares sold:
A class ........................................... 859,702 771,907 731,650 341,908 243,079 355,433
B class ........................................... 366,423 89,150 183,407 134,546 108,244 135,405
C class ........................................... 198,983 61,814 64,124 54,506 48,973 25,201
Shares issued upon reinvestment of distributions from
net Investment income and
net realized gain on investments:
A class ........................................... 114,940 67,203 87,352 106,955 70,558 124,468
B class ........................................... 19,655 10,490 14,064 10,686 5,695 6,562
C class ........................................... 6,278 2,676 3,083 3,179 1,415 1,110
--------- --------- --------- ------- ------- -------
1,565,981 1,003,240 1,083,680 651,780 477,964 648,179
--------- --------- --------- ------- ------- -------
Shares repurchased:
A class ........................................... (370,113) (343,954) (406,050) (423,067) (251,562) (833,421)
B class ........................................... (99,593) (49,387) (54,443) (55,825) (18,336) (23,960)
C class ........................................... (41,822) (14,047) (44,185) (44,536) (16,486) (9,438)
--------- --------- --------- ------- ------- -------
(511,528) (407,388) (504,678) (523,428) (286,384) (866,819)
--------- --------- --------- -------- -------- --------
Net increase (decrease) .............................. 1,054,453 595,852 579,002 128,352 191,580 (218,640)
========= ======= ======= ======= ======= ========
</TABLE>
<PAGE>
60 for tax-exempt income
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
- -------------------------------------------------------------------------------
4. Capital Stock (Continued)
Transactions in capital stock shares were as follows:
<TABLE>
<CAPTION>
TAX-FREE KANSAS FUND TAX-FREE MISSOURI INSURED FUND
----------------------------------------------------------------------
YEAR EIGHT MONTHS YEAR YEAR EIGHT MONTHS YEAR
ENDED ENDED ENDED ENDED ENDED ENDED
8/31/99 8/31/98 12/31/97 8/31/99 8/31/98 12/31/97
<S> <C> <C> <C> <C> <C> <C>
Shares sold:
A class ...................................... 213,539 244,419 114,412 149,789 127,338 265,509
B class ...................................... 172,332 37,997 89,151 47,604 36,960 200,996
C class ...................................... 32,553 3,682 6,942 15,875 2,752 9,719
Shares issued upon reinvestment of distributions from
net investment income and
net realized gain on investments:
A class ...................................... 28,696 16,919 27,906 98,821 70,272 129,146
B class ...................................... 11,924 5,986 7,813 23,890 16,990 33,377
C class ...................................... 564 252 404 404 264 521
------- ------- ------- ------- ------- -------
459,608 309,255 246,628 336,383 254,576 639,268
------- ------- ------- ------- ------- -------
Shares repurchased:
A class ...................................... (285,048) (101,432) (142,361) (471,038) (373,253) (656,405)
B class ...................................... (53,746) (25,196) (12,598) (89,897) (77,609) (175,978)
C class ...................................... (1,377) (2,379) (6,119) (4,175) (13,547) (4,070)
------- ------- ------- ------- ------- -------
(340,171) (129,007) (161,078) (565,110) (464,409) (836,453)
------- ------- ------- ------- ------- -------
Net increase (decrease) ......................... 119,437 180,248 85,550 (228,727) (209,833) (197,185)
======= ======= ====== ======== ======== ========
</TABLE>
<TABLE>
<CAPTION>
TAX-FREE NORTH DAKOTA FUND TAX-FREE OREGON INSURED FUND
---------------------------------------------------------------------
YEAR EIGHT MONTHS YEAR YEAR EIGHT MONTHS YEAR
ENDED ENDED ENDED ENDED ENDED ENDED
8/31/99 8/31/98 12/31/97 8/31/99 8/31/98 12/31/97
<S> <C> <C> <C> <C> <C> <C>
Shares sold:
A class ...................................... 127,381 85,182 68,674 697,470 389,222 372,928
B class ...................................... 18,412 7,136 17,635 268,258 54,361 162,406
C class ...................................... 26,760 -- -- 69,203 49,358 16,538
Shares issued upon reinvestment of distributions from net
investment income and net realized gain on investments:
A class ...................................... 80,736 52,793 95,230 71,190 41,911 61,920
B class ...................................... 2,356 1,149 2,047 13,777 9,754 15,305
C class ...................................... 521 99 156 3,828 1,286 1,157
------- ------- ------- --------- -------- -------
256,166 146,359 183,742 1,123,726 545,892 630,254
------- ------- ------- --------- -------- -------
Shares repurchased:
A class ...................................... (375,693) (205,612) (529,157) (295,662) (238,227) (412,353)
B class ...................................... (9,548) (1,044) (5,593) (42,818) (114,262) (33,265)
C class ...................................... (131) (1,113) (274) (5,433) (6,562) (2,526)
------- ------- -------- --------- -------- -------
(385,372 (207,769) (535,024) (343,913) (359,051) (448,144)
------- ------- ------- --------- ------- -------
Net increase (decrease) ......................... (129,206) (61,410) (351,282) 779,813 186,841 182,110
======== ======= ======== ======= ======= =======
</TABLE>
<PAGE>
for tax-exempt income 61
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
- --------------------------------------------------------------------------------
4. Capital Stock (Continued)
Transactions in capital stock shares were as follows:
TAX-FREE WISCONSIN FUND
--------------------------------
YEAR EIGHT MONTH YEAR
ENDED ENDED ENDED
8/31/99 8/31/98 12/31/97
Shares sold:
A class ............................. 488,062 567,546 729,711
B class ............................. 114,881 95,654 51,892
C class ............................. 55,257 65,500 35,931
Shares issued upon reinvestment
of distributions from net
investment income and net
realized gain on investments:
A class ............................. 90,957 51,547 78,038
B class ............................. 6,775 3,392 4,328
C class ............................. 4,896 2,544 2,504
-------- -------- --------
760,828 786,183 902,404
-------- -------- --------
Shares repurchased:
A class ............................. (500,517) (283,460) (657,954)
B class ............................. (45,854) (31,926) (2,138)
C class ............................. (29,398) (9,845) (27,203)
-------- -------- --------
(575,769) (325,231) (687,295)
-------- -------- --------
Net increase (decrease) ............. 185,059 460,952 (215,109)
======== ======== ========
5. Lines of Credit
The Funds have a committed line of credit for the following amounts:
Tax-Free Idaho Fund .................................... $2,100,000
Tax-Free Iowa Fund ..................................... 2,100,000
Tax-Free Kansas Fund ................................... 700,000
Tax-Free Missouri Insured Fund ......................... 3,000,000
Tax-Free North Dakota Fund ............................. 1,600,000
Tax-Free Oregon Insured Fund ........................... 1,500,000
Tax-Free Wisconsin Fund ................................ 1,700,000
No amounts were outstanding at August 31, 1999, or at any time during the fiscal
year.
<PAGE>
6. Credit And Market Risk
The Funds concentrate their investments in securities mainly issued by each
specific states' municipalities. The value of these investments may be adversely
affected by new legislation within the state, regional or local economic
conditions, and differing levels of supply and demand for municipal bonds. Many
municipalities insure repayment for their obligations. Although bond insurance
reduces the risk of loss due to default by an issuer, such bonds remain subject
to the risk that market value may fluctuate for other reasons and there is no
assurance that the insurance company will meet its obligations. These securities
have been identified in the Statements of Net Assets.
7. Tax Information (Unaudited)
The information set forth below is for each Fund's fiscal year as required by
federal laws. Shareholders, however, must report distributions on a calendar
year basis for income tax purposes, which may include distributions for portions
of two fiscal years of a fund. Accordingly, the information needed by
shareholders for income tax purposes will be sent to them in early 2000. Please
consult your tax advisor for proper treatment of this information.
For the fiscal year ended August 31, 1999, each Fund designates as long term
capital gains, ordinary income, and tax-exempt income distributions paid during
the year as follows:
LONG-TERM ORDINARY TOTAL
CAPITAL GAINS INCOME TAX-EXEMPT DISTRIBUTIONS
DISTRIBUTIONS DISTRIBUTIONS INTEREST (TAX BASIS)
-----------------------------------------------------
Fund:
Tax-Free Idaho Fund ...... -- -- 100% 100%
Tax-Free Iowa Fund ....... -- -- 100% 100%
Tax-Free Kansas Fund ..... 6% -- 94% 100%
Tax-Free Missouri
Insured Fund .......... -- -- 100% 100%
Tax-Free North
Dakota Fund ........... 7% -- 93% 100%
Tax-Free Oregon
Insured Fund .......... -- -- 100% 100%
Tax-Free Wisconsin Fund .. -- -- 100% 100%
<PAGE>
62 for tax-exempt income
REPORT OF INDEPENDENT AUDITORS
- --------------------------------------------------------------------------------
TO THE SHAREHOLDERS AND BOARD OF DIRECTORS
VOYAGEUR MUTUAL FUNDS, INC. - DELAWARE TAX-FREE IDAHO FUND
VOYAGEUR MUTUAL FUNDS, INC. - DELAWARE TAX-FREE IOWA FUND
VOYAGEUR INVESTMENT TRUST - DELAWARE TAX-FREE KANSAS FUND
VOYAGEUR INVESTMENT TRUST - DELAWARE TAX-FREE MISSOURI INSURED FUND
VOYAGEUR TAX-FREE FUNDS, INC. - DELAWARE TAX-FREE NORTH DAKOTA FUND
VOYAGEUR INVESTMENT TRUST - DELAWARE TAX-FREE OREGON INSURED FUND
VOYAGEUR MUTUAL FUNDS, INC. - DELAWARE TAX-FREE WISCONSIN FUND
We have audited the accompanying statements of net assets of Delaware Tax-Free
Idaho Fund, Delaware Tax-Free Iowa Fund, Delaware Tax-Free Kansas Fund, Delaware
Tax-Free Missouri Insured Fund, Delaware Tax-Free North Dakota Fund, Delaware
Tax-Free Oregon Insured Fund and Delaware Tax-Free Wisconsin Fund (the "Funds")
and the statement of assets and liabilities for the Delaware Tax-Free Kansas
Fund as of August 31, 1999, and the related statements of operations for the
year then ended, the statements of changes in net assets for each of the periods
indicated therein, and the financial highlights for each of the periods
presented from January 1, 1997 through August 31, 1999. These financial
statements and financial highlights are the responsibility of the Funds'
management. Our responsibility is to express an opinion on these financial
statements and financial highlights based on our audits. The financial
highlights for the periods presented through December 31, 1996 were audited by
other auditors whose reports thereon dated February 14, 1997 expressed
unqualified opinions on those financial highlights.
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 and financial highlights. Our procedures included confirmation of
securities owned as of August 31, 1999, 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 each
of the respective Funds at August 31, 1999, the results of their operations for
the year then ended, the changes in their net assets for each of the periods
presented therein, and their financial highlights for each of the periods
presented from January 1, 1997 through August 31, 1999, in conformity with
generally accepted accounting principles.
/s/ Ernst & Young
----------------------
Philadelphia, Pennsylvania
October 1, 1999
<PAGE>
for tax-exempt income 63
PROXY RESULTS
(UNAUDITED)
- --------------------------------------------------------------------------------
For the year ended August 31, 1999, Voyageur Investment Trust shareholders voted
on the following proposals at the annual meeting of shareholders on December 4,
1998, the Voyageur Mutual Funds Inc. and Voyageur Tax-Free Funds, Inc.,
shareholders voted at the annual meeting of shareholders on March 17, 1999, or
as adjourned. The description of each proposal and number of shares voted are as
follows:
1. To elect the Voyageur Investment Trust Board of Directors.
SHARES SHARES VOTED
VOTED WITHHELD
FOR AUTHORITY
------------------------
Wayne A. Stork ................................ 6,708,496 780,817
Jeffrey J. Nick* .............................. 6,709,705 779,608
Walter P. Babich .............................. 6,709,705 779,608
Anthony D. Knerr .............................. 6,709,849 779,464
Ann R. Leven .................................. 6,723,556 765,757
W. Thacher Longstreth ......................... 6,723,556 765,757
Thomas F. Madison ............................. 6,723,556 765,757
Charles E. Peck ............................... 6,723,556 765,757
To elect the Voyageur Mutual Funds, Inc. Board of Directors.
SHARES SHARES VOTED
VOTED WITHHELD
FOR AUTHORITY
------------------------
Jeffrey J. Nick* .............................. 23,375,980 933,942
Walter P. Babich .............................. 23,375,739 934,183
Anthony D. Knerr .............................. 23,481,657 828,265
Ann R. Leven .................................. 23,479,947 829,975
Thomas F. Madison ............................. 23,485,349 824,573
Charles E. Peck ............................... 23,485,349 824,573
Wayne A. Stork ................................ 23,485,349 824,573
Jan L. Yeomans ................................ 23,485,349 824,573
To elect the Voyageur Tax-Free Funds, Inc. Board of Directors.
SHARES SHARES VOTED
VOTED WITHHELD
FOR AUTHORITY
-----------------------
Jeffrey J. Nick* .............................. 24,689,040 1,566,542
Walter P. Babich .............................. 24,673,024 1,582,558
Anthony D. Knerr .............................. 24,682,070 1,573,512
Ann R. Leven .................................. 24,708,871 1,546,711
Thomas F. Madison ............................. 24,678,176 1,577,406
Charles E. Peck ............................... 24,709,389 1,546,193
Wayne A. Stork ................................ 24,709,389 1,546,193
Jan L. Yeomans ................................ 24,709,389 1,546,193
- ----------------------
* Mr. Nick resigned from the Board of Directors (or Trustees for the Company)
on June 4, 1999.
<PAGE>
2. To approve the redesignation of the investment objective from fundamental to
non-fundamental.
FOR AGAINST ABSTAIN
----------------------------------
Tax-Free Idaho Fund ................. 2,622,837 58,888 298,723
Tax-Free Iowa Fund .................. 2,710,087 198,511 240,773
Tax-Free Kansas Fund ................ 664,756 28,692 70,188
Tax-Free Missouri Insured Fund ...... 2,920,325 193,729 400,358
Tax-Free North Dakota Fund .......... 1,526,728 73,421 237,097
Tax-Free Oregon Insured Fund ........ 1,448,428 47,861 198,354
Tax-Free Wisconsin Fund ............. 2,215,279 75,153 169,149
3. To approve standardized fundamental investment restrictions (proposal
involves separate votes on seven sub-proposals 3A-3G)
3A. To adopt a new fundamental investment restriction concerning concentration
of the investments in the same industry.
FOR AGAINST ABSTAIN
----------------------------------
Tax-Free Idaho Fund ................. 2,703,117 22,030 255,301
Tax-Free Iowa Fund .................. 2,710,736 146,572 292,065
Tax-Free Kansas Fund ................ 665,996 28,288 69,352
Tax-Free Missouri Insured Fund ...... 2,961,133 139,658 413,622
Tax-Free North Dakota Fund .......... 1,567,814 66,795 202,638
Tax-Free Oregon Insured Fund ........ 1,458,453 41,015 195,175
Tax-Free Wisconsin Fund ............. 2,254,928 58,915 145,738
3B. To adopt a new fundamental investment restriction concerning borrowing money
and issuing senior securities.
FOR AGAINST ABSTAIN
----------------------------------
Tax-Free Idaho Fund ................. 2,692,872 56,608 230,970
Tax-Free Iowa Fund .................. 2,655,563 231,615 262,194
Tax-Free Kansas Fund ................ 677,438 31,723 54,475
Tax-Free Missouri Insured Fund ...... 2,953,471 150,240 410,702
Tax-Free North Dakota Fund .......... 1,566,435 63,781 207,031
Tax-Free Oregon Insured Fund ........ 1,477,124 28,335 189,184
Tax-Free Wisconsin Fund ............. 2,248,732 55,957 154,892
3C. To adopt a new fundamental investment restriction concerning underwriting.
FOR AGAINST ABSTAIN
----------------------------------
Tax-Free Idaho Fund ................. 2,633,636 47,883 298,930
Tax-Free Iowa Fund .................. 2,638,663 204,631 306,077
Tax-Free Kansas Fund ................ 680,386 28,288 54,962
Tax-Free Missouri Insured Fund ...... 2,964,848 140,191 409,374
Tax-Free North Dakota Fund .......... 1,544,818 66,061 226,368
Tax-Free Oregon Insured Fund ........ 1,459,777 39,294 195,572
Tax-Free Wisconsin Fund ............. 2,228,872 64,483 166,225
<PAGE>
64 for tax-exempt income
PROXY RESULTS (CONTINUED)
- --------------------------------------------------------------------------------
3D. To adopt a new fundamental investment restriction concerning investments in
real estate.
FOR AGAINST ABSTAIN
----------------------------------
Tax-Free Idaho Fund ................. 2,653,554 57,857 269,036
Tax-Free Iowa Fund .................. 2,671,027 220,915 257,431
Tax-Free Kansas Fund ................ 687,039 27,703 48,894
Tax-Free Missouri Insured Fund ...... 2,980,740 135,413 398,259
Tax-Free North Dakota Fund .......... 1,522,123 72,064 243,059
Tax-Free Oregon Insured Fund ........ 1,470,570 30,203 193,870
Tax-Free Wisconsin Fund ............. 2,246,067 62,934 150,580
3E. To adopt a new fundamental investment restriction concerning investments in
commodities.
FOR AGAINST ABSTAIN
----------------------------------
Tax-Free Idaho Fund ................. 2,625,913 63,222 291,312
Tax-Free Iowa Fund .................. 2,626,422 229,576 293,374
Tax-Free Kansas Fund ................ 668,116 46,627 48,894
Tax-Free Missouri Insured Fund ...... 2,886,008 215,282 413,122
Tax-Free North Dakota Fund .......... 1,545,853 92,310 199,085
Tax-Free Oregon Insured Fund ........ 1,456,865 50,344 187,434
Tax-Free Wisconsin Fund ............. 2,218,125 89,120 152,336
3F. To adopt a new fundamental investment restriction concerning lending by the
Fund.
FOR AGAINST ABSTAIN
----------------------------------
Tax-Free Idaho Fund ................. 2,619,906 70,818 289,724
Tax-Free Iowa Fund .................. 2,661,827 216,495 271,050
Tax-Free Kansas Fund ................ 679,231 35,948 48,457
Tax-Free Missouri Insured Fund ...... 2,933,022 179,118 402,272
Tax-Free North Dakota Fund .......... 1,559,120 71,528 206,598
Tax-Free Oregon Insured Fund ........ 1,457,792 49,048 187,803
Tax-Free Wisconsin Fund ............. 2,214,685 99,305 145,592
3G. To reclassify all current fundamental investment restrictions as
non-fundamental.
FOR AGAINST ABSTAIN
----------------------------------
Tax-Free Idaho Fund ................. 2,633,302 51,690 295,457
Tax-Free Iowa Fund .................. 2,552,811 248,146 348,416
Tax-Free Kansas Fund ................ 663,684 30,309 69,643
Tax-Free Missouri Insured Fund ...... 2,888,983 187,232 438,196
Tax-Free North Dakota Fund .......... 1,522,045 59,327 255,875
Tax-Free Oregon Insured Fund ........ 1,452,676 40,998 200,969
Tax-Free Wisconsin Fund ............. 2,210,012 83,781 165,787
<PAGE>
4. To approve a new investment management agreement with Delaware Management
Company for the Funds.
FOR AGAINST ABSTAIN
----------------------------------
Tax-Free Idaho Fund ................. 2,703,801 30,075 246,573
Tax-Free Iowa Fund .................. 2,692,600 169,825 286,946
Tax-Free Kansas Fund ................ 673,984 31,620 58,032
Tax-Free Missouri Insured Fund ...... 3,007,138 118,442 388,832
Tax-Free North Dakota Fund .......... 1,521,690 93,616 221,940
Tax-Free Oregon Insured Fund ........ 1,490,882 26,880 176,881
Tax-Free Wisconsin Fund ............. 2,239,655 57,102 162,824
5. To ratify the selection of Ernst & Young LLP, as the independent auditors for
Voyageur Investment Trust.
FOR AGAINST ABSTAIN
----------------------------------
6,100,208 40,763 538,338
To ratify the selection of Ernst & Young LLP, as the independent auditors for
Voyageur Mutual Funds, Inc.
FOR AGAINST ABSTAIN
----------------------------------
23,192,942 243,342 873,624
To ratify the selection of Ernst & Young LLP, as the independent auditors for
Voyageur Tax-Free Funds, Inc.
FOR AGAINST ABSTAIN
----------------------------------
24,357,056 333,988 1,564,528
6. To approve the restructuring of Voyageur Investment Trust from a
Massachusetts Business Trust into a Maryland Corporation.
FOR AGAINST ABSTAIN
----------------------------------
5,232,140 136,091 604,462
To approve the restructuring of Voyageur Mutual Funds, Inc. from a Minnesota
Corporation into a Delaware Business Trust and the dissolution of the
Minnesota Corporation.
FOR AGAINST ABSTAIN
----------------------------------
18,642,505 933,974 1,312,086
To approve the restructuring of Voyageur Tax-Free Funds, Inc. from a
Minnesota Corporation into a Delaware Business Trust and the dissolution of
the Minnesota Corporation.
FOR AGAINST ABSTAIN
----------------------------------
18,966,804 3,045,110 2,212,199
<PAGE>
THIS ANNUAL REPORT IS FOR THE INFORMATION OF TAX-FREE IDAHO FUND, TAX-FREE IOWA
FUND, Tax-Free Kansas Fund, Tax-Free Missouri Insured Fund, Tax-Free North
Dakota Fund, Tax-Free Oregon Insured Fund, and Tax-Free Wisconsin Fund
shareholders, but it may be used with prospective investors when preceded or
accompanied by a current Prospectus for each Fund, which set forth details about
charges, expenses, investment objectives and operating policies of each Fund.
You should read the prospectus carefully before you invest. The figures in this
report represent past results which are not a guarantee of future results. The
return and principal value of an investment in each Fund will fluctuate so that
shares, when redeemed, may be worth more or less than their original cost.
Board of Directors
WAYNE A. STORK
Chairman
Delaware Investments Family of Funds
Philadelphia, PA
WALTER P. BABICH
Board Chairman, Citadel Constructors, Inc.
King of Prussia, PA
DAVID K. DOWNES
President and Chief Executive Officer
Delaware Investments Family of Funds
Philadelphia, PA
JOHN H. DURHAM
Partner, Complete Care Services
Horsham, PA
ANTHONY D. KNERR
Consultant, Anthony Knerr & Associates
New York, NY
ANN R. LEVEN
Treasurer, National Gallery of Art
Washington, DC
THOMAS F. MADISON
President and Chief Executive Officer
MLM Partners, Inc.
Minneapolis, MN
CHARLES E. PECK
Secretary/Treasurer, Enterprise Homes, Inc.
Fredericksburg, VA
JAN L. YEOMANS
Vice President and Treasurer
3M Corporation
St. Paul, Minnesota
<PAGE>
Affiliated Officers
RICHARD J. FLANNERY
Executive Vice President and General Counsel
Delaware Investments Family of Funds
Philadelphia, PA
BRUCE D. BARTON
President and Chief Executive Officer
Delaware Distributors, L.P.
Philadelphia, PA
ERIC E. MILLER
Senior Vice President, Secretary
and Deputy General Counsel
Delaware Investments Family of Funds
Philadelphia, PA
(photo of globes)
directors
& officers
INVESTMENT MANAGER
Delaware Management Company
Philadelphia, Pennsylvania
INTERNATIONAL AFFILIATE
Delaware International Advisers Ltd.
London, England
NATIONAL DISTRIBUTOR
Delaware Distributors, L.P.
Philadelphia, Pennsylvania
SHAREHOLDER SERVICING,
DIVIDEND DISBURSING
AND TRANSFER AGENT
Delaware Service Company, Inc.
Philadelphia, Pennsylvania
1818 Market Street
Philadelphia, PA 19103-3682
<PAGE>
When used with prospective investors, this report must be preceded or
accompanied by a current prospectus for the Funds and the Delaware Investments
Performance Update for the most recently completed calendar quarter. For a
prospectus of any other mutual fund from Delaware Investments, contact your
financial adviser or Delaware Investments.
(photo of globes)
For Shareholders
1.800.523.1918
For Securities Dealers
1.800.362.7500
For Financial Institutions
Representatives Only
1.800.659.2265
www.delawareinvestments.com
Be sure to consult your financial adviser when making investments. Mutual funds
can be a valuable part of your financial plan; however, shares of the Funds are
not FDIC or NCUSIF insured, are not guaranteed by any bank or any credit union,
and involve investment risk, including the possible loss of the principal amount
invested. Shares of the Funds are not bank or credit union deposits.
(C) Delaware Distributors, L.P.
DELAWARE(SM)
INVESTMENTS
- ----------------------
Philadelphia [] London
Printed in the USA
on recycled paper
(J5159) (2173)
AR-CORN[8/99]PPL10/99
