REPORT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
Board of Trustees
of Liberty-Stein Roe Funds Municipal Trust
In planning and performing our audit of the financial statements of the Funds
listed in the appendix attached hereto (the "Funds"), each a series of
Liberty-Stein Roe Funds Municipal Trust (formerly, Stein Roe Municipal Trust)
(the "Trust"), for the year ended June 30, 2000, we considered each Fund's
internal control, including control activities for safeguarding securities, to
determine our auditing procedures for the purpose of expressing our opinion on
the financial statements and to comply with the requirements of Form N-SAR, not
to provide assurance on internal control.
The management of the Trust is responsible for establishing and maintaining
internal control. In fulfilling this responsibility, estimates and judgments by
management are required to assess the expected benefits and related costs of
internal control. Generally, internal controls that are relevant to an audit
pertain to the Trust's objective of preparing financial statements for external
purposes that are fairly presented in conformity with generally accepted
accounting principles. Those internal controls include the safeguarding of
assets against unauthorized acquisition, use, or disposition.
Because of inherent limitations in any internal control, misstatements due to
error or fraud may occur and not be detected. Also, projections of any
evaluation of internal control to future periods are subject to the risk that
internal control may become inadequate because of changes in conditions, or that
the degree of compliance with the policies or procedures may deteriorate.
Our consideration of internal control would not necessarily disclose all matters
in internal control that might be material weaknesses under standards
established by the American Institute of Certified Public Accountants. A
material weakness is a condition in which the design or operation of one or more
of the internal control components does not reduce to a relatively low level the
risk that misstatements caused by error or fraud in amounts that would be
material in relation to the financial statements being audited may occur and not
be detected within a timely period by employees in the normal course of
performing their assigned functions. However, we noted no matters involving
internal control, including control activities for safeguarding securities, and
its operation that we consider to be material weaknesses as defined above as of
June 30, 2000.
This report is intended solely for the information and use management, the Board
of Trustees of the Trust and the Securities and Exchange Commission and is not
intended to be and should not be used by anyone other than these specified
parties.
Boston, Massachusetts
August 18, 2000
Appendix
Liberty-Stein Roe Funds Municipal Trust:
Stein Roe High-Yield Municipals Fund
Stein Roe Intermediate Municipals Fund
Stein Roe Managed Municipals Fund
Stein Roe Municipal Money Market Fund
