[Acorn, Column, Graduation Hat, Shaking Hands -- Graphics]
Semi-Annual Report
April 30, 1999
Galaxy Tax-Free Bond Funds
Galaxy Funds
Galaxy Tax-Exempt Bond Fund
Galaxy New Jersey Municipal
Bond Fund
Galaxy New York Municipal
Bond Fund
Galaxy Connecticut Municipal
Bond Fund
Galaxy Massachusetts Municipal
Bond Fund
Galaxy Rhode Island Municipal
Bond Fund
[Galaxy Funds Logo]
<PAGE>
Chairman's Message
Dear Shareholder:
Enclosed is the Galaxy Tax-Free Bond Funds' performance report for the six
months ended April 30, 1999. The report includes a Market Overview that
describes the different economic and market factors influencing tax-free bonds
during this time. Following the Market Overview are portfolio reviews for each
of the Galaxy Tax-Free Bond Funds that describe how Fleet Investment Advisors
Inc. managed the Funds' portfolios in this climate. Financial statements and a
list of portfolio holdings for each of the Funds as of April 30, 1999 appear at
the end of the report.
Although the economic outlook brightened during the recent six-month
period, bond yields moved higher and their prices fell. With investors
abandoning an earlier flight to quality, municipal bonds and other fixed-income
issues outperformed U.S. Treasury securities. Individual sectors of the stock
market also responded to a changing outlook in different ways. As in previous
transitions, experienced investors held to their long-term strategies and kept
their portfolios well diversified.
During this time, Fleet Investment Advisors Inc. has also worked with us
to expand the information we provide to our shareholders. By giving you more
information that is easier to access, we hope to help you manage current market
conditions more effectively and develop investment plans that bring you closer
to your financial goals.
At the end of 1998, we launched The Galaxy, America's first mutual fund
newspaper. Sent to more than 200,000 retail shareholders of the Galaxy Funds,
this quarterly publication provides in-depth coverage of key market trends,
investment issues, and planning tools. There are also interviews with Galaxy
Fund portfolio managers, as well as announcements of new products and services
for shareholders.
In addition, we are expanding our web site (www.galaxyfunds.com). The
revised site -- which should be completed by the end of this summer -- will
include more educational articles, interactive services, and market reports.
Shareholders will also be able to access many of the articles from The Galaxy on
the site.
We hope these new shareholder services will help you make the most of your
Galaxy Fund investments. We encourage you to contact us for any additional
information you may need, including questions about the material in this report,
by calling the Galaxy Information Center toll-free at 1-877-BUY-GALAXY
(1-877-289-4252). You can also visit our investment professionals located at
Fleet branches.
Sincerely,
/s/ Dwight E. Vicks, Jr.
Dwight E. Vicks, Jr.
Chairman of the Board of Trustees
[Begin Sidebar]
Mutual Funds:
o are not bank deposits
o are not FDIC insured
o are not obligations of Fleet Bank
o are not guaranteed by Fleet Bank
o are subject to investment risk including possible loss of principal amount
invested
[End Sidebar]
<PAGE>
Market Overview
Tax-Free Bond Market Overview
By Fleet Investment Advisors Inc.
Bond yields rose and prices fell during the six months ended April 30,
1999, as a vibrant domestic economy raised the issue of inflation in the
fixed-income markets. With greater economic optimism, however, investors sought
value in other sectors that had underperformed U.S. Treasury securities during
the flight to quality that occurred late in 1998. The municipal market had
further suffered as low absolute yields discouraged demand by retail investors
and increased debt issuance throughout 1998 had pushed supplies to record
levels. By early 1999, municipal bond yields had reached historically high
levels versus yields for U.S. Treasuries.
Lower funding needs for municipalities in the first quarter of 1999,
however, helped to reduce supply and sentiment in the municipal bond market
improved. In addition, a rise in bond yields generally rekindled retail
investors' demand for municipal bonds. These factors helped to mitigate the
decline in municipal prices as interest rates rose. As a result, municipals
outpaced Treasuries by a wide margin over the reporting period. By the end of
the period, municipal yields had moved higher by less than one-third of the
movement in Treasury yields.
Economic Outlook Brightens
At the start of the period, 30-year Treasury bonds were yielding 5.20%,
the Lehman Brothers Municipal Bond Index was yielding 4.38% and inflation was
about 1.6%. After growing at an annualized rate of 3.7% in the third quarter of
1998, the gross domestic product ("GDP"), which measures the output of U.S.
goods and services, increased by 6% in the fourth quarter of 1998. Consumer
spending was vibrant -- fueled by record low unemployment, stock market gains,
falling import prices, and dramatic cuts in interest rates by the Federal
Reserve ("the Fed") and central banks in other parts of the world.
In the second half of 1998, global economic concerns had driven investors
at home and abroad to the safety of U.S. Treasury securities. By the fourth
quarter of 1998, this flight to quality had created an international liquidity
crisis. After cutting short-term interest rates by 25 basis points (0.25%) in
both September and October to stem the crisis, the Fed imposed a third 25 basis
point cut in November.
Besides instilling confidence in U.S. growth, the cuts in short-term rates
eased demand for Treasury securities and set the stage for higher bond yields.
While the Fed indicated that it would not cut rates again unless there was
further economic deterioration, some investors felt the third rate cut was
unnecessary and might even jeopardize the benign inflation environment of recent
years. The risk that the Fed's monetary policy might be too loose, combined with
greater stability overseas, drove yields upward in the first months of 1999.
Although inflation remained low, investors felt that GDP growth in excess of 4%
would put further pressure on a labor market that was already tight and would
eventually cause higher wages and inflation. With investors worried that the Fed
might have to increase short-term rates to preempt future inflation, the yield
for long-term Treasuries rose to about 5.7% by the end of April. The yield for
the Lehman Municipal Bond Index stood at 4.46% when the reporting period closed.
[Begin Sidebar]
"By early 1999, municipal bond yields had reached historically high levels
versus yields for U.S. Treasuries. Lower funding needs for municipalities in
the first quarter of 1999, however, helped to reduce supply and sentiment in
the municipal bond market improved."
[End Sidebar]
2
<PAGE>
Anticipating Slower Growth
The current eight-year economic expansion is the longest period of
domestic growth since 1969. The lengthy expansion has been fostered in part by
low inflation that in turn has been sustained by improved productivity and
moderate wage gains. After a strong showing in the first quarter of 1999,
however, we believe the rate of GDP growth in the U.S. could slow to less than
3% later this year. Although economies abroad appear to have stabilized,
substantial imbalances remain that could continue to curb U.S. exports. At the
same time, consumer spending is likely to slow after matching or exceeding
personal income for some time.
With slower growth, price increases should remain tame, thereby allowing
the Fed to keep interest rates on hold. Once the threat of higher rates has
subsided, bond yields could decline once again. In the meantime, however, yields
could continue to rise -- especially since the Fed has indicated that its next
move would likely be to boost interest rates should a general rise in prices of
goods and services occur.
Now that most of the additional value in municipals has been absorbed, the
sector is more likely to perform in line with Treasuries if yields fall. Lower
interest rates could increase municipal debt issuance, which may hinder price
performance in the tax-exempt market. Independent of the direction of rates,
plan to continue to emphasize bonds with strong credit fundamentals --
especially as the incremental return for increased risk remains at historically
low levels. We expect to use any additional backup in rates to further improve
the overall yield and credit quality of investments in the Galaxy Tax-Free Bond
Funds.
[Begin Sidebar]
"The current eight-year economic expansion is the longest period of domestic
growth since 1969. The lengthy expansion has been fostered in part by low
inflation that in turn has been sustained by improved productivity and
moderate wage gains."
[End Sidebar]
3
<PAGE>
PERFORMANCE AT-A-GLANCE
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS -- TRUST SHARES
Periods ended April 30, 1999 6 Months 1 Year 3 Years 5 Years Life of Fund
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Tax-Exempt Bond Fund
(Inception date 12/30/91) 1.43% 6.47% 7.11% 6.81% 6.80%
..........................................................................................................
New Jersey Municipal Bond Fund
(Inception date 4/3/98) 0.96 5.92 N/A N/A 5.10
..........................................................................................................
New York Municipal Bond Fund
(Inception date 12/31/91) 1.22 6.61 6.97 6.75 6.55
..........................................................................................................
Connecticut Municipal Bond Fund
(Inception date 12/14/90) 1.16 6.46 6.91 6.79 5.72
..........................................................................................................
Massachusetts Municipal Bond Fund
(Inception date 12/14/90) 1.67 6.77 7.11 6.82 5.54
- ----------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS -- RETAIL A SHARES+
Periods ended April 30, 1999 6 Months 1 Year 3 Years 5 Years Life of Fund
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Tax-Exempt Bond Fund
(Inception date 12/30/91) -2.49% 2.23% 5.51% 5.78% 6.21%
..........................................................................................................
New Jersey Municipal Bond Fund
(Inception date 4/3/98) -2.94 1.70 N/A N/A 1.20
..........................................................................................................
New York Municipal Bond Fund
(Inception date 12/31/91) -2.71 2.46 5.42 5.75 5.87
..........................................................................................................
Connecticut Municipal Bond Fund
(Inception date 3/16/93) -2.72 2.24 5.34 5.76 4.90
..........................................................................................................
Massachusetts Municipal Bond Fund
(Inception date 3/12/93) -2.23 2.57 5.58 5.84 4.75
..........................................................................................................
Rhode Island Municipal Bond Fund
(Inception date 12/20/94) -2.34 2.15 5.65 N/A 6.64
- ----------------------------------------------------------------------------------------------------------
</TABLE>
+ Return figures have been restated to include the effect of the maximum
3.75% front-end sales charge which became effective on December 1, 1995.
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS -- RETAIL B SHARES**
6 Month 6 Month 1 Year 1 Year Life of Fund Life of Fund
Return Before Return After Return Before Return After Return Before Return After
Contingent Contingent Contingent Contingent Contingent Contingent
Periods ended Deferred Sales Deferred Sales Deferred Sales Deferred Sales Deferred Sales Deferred Sales
April 30, 1999 Charge Deducted Charge Deducted* Charge Deducted Charge Deducted* Charge Deducted Charge Deducted*
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Tax-Exempt Bond Fund
(Inception date 3/4/96) 1.00% (3.90)% 5.59% 0.59% 5.00% 4.42%
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
* As if shares were redeemed at end of period.
** Retail B Shares are subject to a 5.00% contingent deferred sales charge if
shares are redeemed within the first year. The charge decreases to 4.00%,
3.00%, 3.00%, 2.00% and 1.00% for redemptions made during the second
through sixth years, respectively. Retail B Shares automatically convert to
Retail A Shares after six years. Total returns are from the date of
inception. Six months returns are unannualized total returns.
Past performance is no guarantee of future results. Investment returns and
principal values will vary with market conditions so that an investor's shares,
when redeemed, may be worth more or less than their original cost. The
Investment Advisor is presently waiving fees and/or reimbursing expenses and may
revise or discontinue such practice at any time. Without such waivers and/or
reimbursements, performance would be lower. Total return figures in this report
include changes in share price, reinvestment of dividends and capital gains
distributions and include the deduction of any sales charges, where applicable,
unless otherwise indicated.
4
<PAGE>
Portfolio Reviews
[photo: Migliozzi]
Glenn Migliozzi is the managing director of Fixed Income Investments for Fleet
Investment Advisors Inc. He is also a member of Fleet's Tax-Exempt Investment
Policy Committee of Fleet Investment Advisors Inc., which has managed the Galaxy
Tax-Exempt Bond, New York Municipal Bond, Connecticut Municipal Bond,
Massachusetts Municipal Bond and Rhode Island Municipal Bond Funds since 1996
and the Galaxy New Jersey Municipal Bond Fund since it commenced operations in
April of 1998.
GALAXY TAX-EXEMPT BOND FUND
By Glenn Migliozzi, CFA
Managing Director, Fixed Income Investments
As an improving economic outlook drove bond yields higher in the six
months ended April 30, 1999, prices for intermediate-term issues declined less
than the prices for longer-term bonds. Our emphasis on intermediate-term issues
in the Galaxy Tax-Exempt Bond Fund helped enhance the Fund's returns in this
environment.
During the reporting period, the Fund's Trust Shares earned a total return
of 1.43%. Over the same time, Retail A Shares had a total return of 1.31% before
deducting the maximum 3.75% front-end sales charge, and Retail B Shares had a
total return of 1.00% before deducting the maximum 5.00% contingent deferred
sales charge. (Please see the chart on page 4 for total returns after deducting
the front-end sales charge and the contingent deferred sales charge.)
Over the same time, the average general municipal bond fund reporting its
performance to Lipper Analytical Services ("Lipper"), a mutual fund performance
tracking service, had a total return of 1.20%, and the Lehman Brothers Municipal
Bond Index had a total return of 1.75%.
On April 30, 1999, the Fund's Trust Shares had a 30-day Securities and
Exchange Commission ("SEC") annualized yield of 3.69%. On the same date, Retail
A Shares had a 30-day SEC annualized yield of 3.53%, and Retail B Shares had a
30-day SEC annualized yield of 3.03%. For shareholders in the 36% federal income
tax bracket, these equaled taxable yields of 5.71%, 5.51%, and 4.73%,
respectively.
Adding Intermediate-Term Issues
Having emphasized longer-term municipals for most of 1998 as bond prices
were rising, we increased attention to the intermediate sector in the fourth
quarter when prices appeared to peak. Our continued focus on premium-coupon
issues with good call protection further enhanced returns when prices fell in
the months that followed.
As an additional defensive measure, we raised the cash position of the
portfolio. Later, as interest rates became more attractive, we used these
reserves to enhance the Fund's yield.
Given the narrow spread between yields for issues of high and low credit
quality, we continued to emphasize higher-quality municipals. In particular, the
Fund benefited from a lower relative weighting in uninsured hospital bonds,
which performed poorly on concerns about earnings in the sector.
Positioned for Slower Growth
If the economy slows and bonds rally, the Fund should benefit from an
average maturity that remains slightly longer than that of its benchmark. As
slower growth causes credit spreads to widen, the Fund should also benefit from
its emphasis on higher-rated issues.
Galaxy Tax-Exempt Bond Fund
Distribution of Total Net Assets as of April 30, 1999
Cash Equivalents & Net Other Assets and Liabilities 1%
North Central 13%
South 36%
Pacific 8%
Mountain 3%
Other Territories 3%
East 36%
Galaxy Tax-Exempt Bond Fund
Growth of $10,000 investment*
Lehman Brothers Municipal Bond Index $10,000 -- $16,997
Galaxy Tax-Exempt Bond Fund - Retail A Shares $ 9,625 -- $15,428
Galaxy Tax-Exempt Bond Fund - Trust Shares $10,000 -- $16,198
Galaxy Tax-Exempt Bond Fund - Retail B Shares $10,000 -- $11,464
*Since inception on 12/30/91 for Trust and Retail A Shares. Since inception on
3/4/96 for Retail B Shares. Performance figures for Retail A Shares include the
effect of the maximum 3.75% front-end sales charge. Performance figures for
Retail B Shares reflect the deduction of the maximum 5.00% contingent deferred
sales charge as if shares were redeemed on April 30, 1999. The Lehman Brothers
Municipal Bond Index is an unmanaged index in which investors cannot invest.
Results for the index do not reflect investment management fees and other
expenses incurred by the Fund.
5
<PAGE>
Portfolio Reviews
GALAXY NEW JERSEY MUNICIPAL BOND FUND
By Glenn Migliozzi, CFA
Managing Director, Fixed Income Investments
When we launched the Galaxy New Jersey Municipal Bond Fund in April of
1998, we emphasized investments with premium coupons, intermediate maturities,
and strong credit quality. We have maintained this strategy since the Fund's
inception. Over the period, the Fund underperformed its peer group as a result
of lower relative weightings in debt with higher yields, longer maturities, and
lower credit ratings. We remain convinced that the emphasis on quality will
prove beneficial, however, as slower economic growth causes a further widening
in the yield spread between AAA and BBB rated debt.
For the six months ended April 30, 1999, the Fund's Trust Shares had a
total return of 0.96%. Over the same time, Retail A Shares had a total return of
0.85% before deducting the maximum 3.75% front-end sales charge. (Please see
chart on page 4 for total returns after deducting the front-end sales charge.)
The average New Jersey municipal bond fund tracked by Lipper had a total return
of 1.24% for the same period, and the Lehman Municipal Bond Index had a total
return of 1.75%.
On April 30, 1999, the Fund's Trust Shares had a 30-day SEC annualized
yield of 3.32%. On the same date, Retail A Shares had a 30-day SEC annualized
yield of 3.14%. This equaled taxable yields of 5.54% and 5.24%, respectively,
for shareholders in the 36% Federal income tax bracket who live in the State of
New Jersey.
Investment Strategies
Early in 1999, we increased the portfolio's cash position to protect the
value of Fund shares while interest rates were rising. We plan to deploy these
reserves in longer-maturity debt to enhance the Fund's yield and improve the
overall maturity structure of the portfolio. We expect to also continue to
emphasize investments of high credit quality. By underweighting the
hospital/healthcare sector in particular, we have avoided the poor price
performance that has occurred in the sector as a result of weak earnings and
continued concerns about rising drug costs.
Looking Ahead
Should the economy slow and bonds rally, as we expect, the Fund should
benefit from the addition of longer-maturity issues. When bond prices rise, the
prices for longer-term issues tend to outperform those for shorter maturities.
The Fund should also benefit from its emphasis on higher-rated municipals, as
slower growth causes credit spreads to widen.
Galaxy New Jersey Municipal Bond Fund
Distribution of Total Net Assets as of April 30, 1999
Cash Equivalents & Net Other Assets and Liabilities 2%
Other Territories 11%
New Jersey 87%
Galaxy New Jersey Municipal Bond Fund
Growth of $10,000 investment*
Lehman Brothers Municipal Bond Index $10,000 -- $10,647
Galaxy New Jersey Municipal Bond Fund - Retail A Shares $ 9,625 -- $ 9,748
Galaxy New Jersey Municipal Bond Fund - Trust Shares $10,000 -- $10,548
*Since inception on 4/3/98. Performance figures for Retail A Shares include the
effect of the maximum 3.75% front-end sales charge. The Lehman Brothers
Municipal Bond Index is an unmanaged index in which investors cannot invest.
Results for the index do not reflect investment management fees and other
expenses incurred by the Fund. Results for the index are calculated since
4/30/98 because the index returns are calculated at month-end only.
6
<PAGE>
Portfolio Reviews
GALAXY NEW YORK MUNICIPAL BOND FUND
By Glenn Migliozzi, CFA
Managing Director, Fixed Income Investments
During the reporting period, the Galaxy New York Municipal Bond Fund
benefited as supplies of municipals in New York shrank more than supplies
elsewhere in the country. The addition of intermediate-term issues at the end of
1998 also enhanced returns.
For the six months ended April 30, 1999, the Fund's Trust Shares had a
total return of 1.22%. During the same time, Retail A Shares returned 1.12%
before deducting the maximum 3.75% front-end sales charge. (Please see the chart
on page 4 for total returns after deducting the front-end sales charge.) Over
this period, the average New York municipal bond fund tracked by Lipper returned
1.28%, and the Lehman Municipal Bond Index returned 1.75%.
On April 30, 1999, the Fund's Trust Shares had a 30-day SEC annualized
yield of 3.71%. On the same date, Retail A Shares had a 30-day SEC annualized
yield of 3.56%. These are the same as taxable yields of 6.22% and 5.97%,
respectively, for shareholders in the 36% federal income tax bracket who live in
the State of New York.
A Shift in Maturities
For most of 1998, we emphasized municipals with longer maturities to make
the most of a decline in interest rates. During the fourth quarter, when yields
seemed to be bottoming, we found more value in intermediate-term maturities. By
increasing the portfolio's allocation to intermediate-term issues, we helped
protect the value of Fund shares as interest rates rose and bond prices fell.
Early in 1999, we modestly increased the Fund's cash allocation -- which
we will likely look to deploy in new investments at higher yields. We plan to
remain underweighted in uninsured hospital bonds, which have underperformed as
substantial cutbacks in Medicare reimbursements have helped to reduce earnings
in the sector.
Yield Spreads to Widen
Yields for municipals with lower credit ratings remain historically close
to AAA credits. If the economy slows in coming months, however, we would expect
lower-quality issues to underperform the higher credit issues and the quality
spreads to widen. The Fund is well positioned to benefit from this change in
yield spreads, given our overall emphasis on higher-quality issues.
With an average maturity that is slightly longer than that of its
benchmark, the Fund should also benefit as slower growth should prompt a rally
in bond prices.
Galaxy New York Municipal Bond Fund
Distribution of Total Net Assets as of April 30, 1999
Other Territories 3%
Cash Equivalents & Net Other Assets and Liabilities 2%
New York 95%
Galaxy New York Municipal Bond Fund
Growth of $10,000 investment*
Lehman Brothers Municipal Bond Index $10,000 -- $16,997
Galaxy New York Municipal Bond Fund - Retail A Shares $ 9,625 -- $15,189
Galaxy New York Municipal Bond Fund - Trust Shares $10,000 -- $15,923
*Since inception on 12/31/91. Performance figures for Retail A Shares include
the effect of the maximum 3.75% front-end sales charge. The Lehman Brothers
Municipal Bond Index is an unmanaged index in which investors cannot invest.
Results for the index do not reflect investment management fees and other
expenses incurred by the Fund.
7
<PAGE>
Portfolio Reviews
GALAXY CONNECTICUT MUNICIPAL BOND FUND
By Glenn Migliozzi, CFA
Managing Director, Fixed Income Investments
Over the six months ended April 30, 1999, supplies of new issue municipal
bonds in Connecticut shrank more than supplies elsewhere in the country. This
enhanced the value of existing bonds in the state as bond yields rose and prices
fell. The Galaxy Connecticut Municipal Bond Fund slightly underperformed its
Lipper peer group during this time, however, due to our continued focus on
higher-quality bonds. Returns for higher-yielding, lower-rated bonds were
relatively strong in a low interest rate environment, due to the additional
yield they provided over AA- and AAA-rated issuers.
During the reporting period, the Fund's Trust Shares earned a total return
of 1.16%. Before deducting the maximum 3.75% front-end sales charge, Retail A
Shares earned a total return of 1.06%. (Please see the chart on page 4 for total
returns after deducting the front-end sales charge.) During the same period, the
average Connecticut municipal bond fund tracked by Lipper returned 1.43% and the
Lehman Municipal Bond Index returned 1.75%.
On April 30, 1999, the Fund's Trust Shares had a 30-day SEC annualized
yield of 3.67%. On the same date, Retail A Shares had a 30-day SEC annualized
yield of 3.52%. These equal taxable yields of 6.01% and 5.76%, respectively, for
shareholders in the 36% federal income tax bracket who live in the State of
Connecticut.
Further Help from High Coupons, Call Protection
Having emphasized longer-term municipals for most of 1998, when bond
prices were rising, we added intermediate-term issues in the fourth quarter, as
prices seemed to peak. As before, we focused on premium-coupon issues with good
call protection -- which helped returns when prices fell in the months that
followed.
In the first months of 1999, we shortened the portfolio's maturity
structure by raising its cash position to protect the value of Fund shares
against rising interest rates. We used this cash to buy investments with higher
yields later in the period. We continued to emphasize municipals with higher
credit quality, as the yield spreads between high and low quality credits
remained narrow.
In particular, the Fund also benefited from an underweighting in uninsured
hospital bonds, which performed poorly on concerns about health care earnings.
Longer Maturities Should Outperform
If economic growth slows and bond prices rally, as we expect, the Fund
should benefit from an average maturity that is slightly longer than that of its
benchmark. We also anticipate that with an economic slowdown, municipals with
higher credit quality should outperform. The Fund's emphasis on quality should
enhance returns in this environment.
Galaxy Connecticut Municipal Bond Fund
Distribution of Total Net Assets as of April 30, 1999
Cash Equivalents & Net Other Assets and Liabilities 1%
Other Territories 13%
Connecticut 86%
Galaxy Connecticut Municipal Bond Fund
Growth of $10,000 investment*
Lehman Brothers Municipal Bond Index $10,000 -- $16,240
Galaxy Connecticut Municipal Bond Fund - Retail A Shares $ 9,625 -- $13,402
Galaxy Connecticut Municipal Bond Fund - Trust Shares $10,000 -- $14,059
*Since inception on 3/16/93. Performance figures for Retail A Shares include
the effect of the maximum 3.75% front-end sales charge. The Lehman Brothers
Municipal Bond Index is an unmanaged index in which investors cannot invest.
Results for the index do not reflect investment management fees and other
expenses incurred by the Fund. Results for the index are calculated since
3/31/93 because the index returns are calculated at month-end only.
8
<PAGE>
Portfolio Reviews
GALAXY MASSACHUSETTS MUNICIPAL BOND FUND
By Glenn Migliozzi, CFA
Managing Director, Fixed Income Investments
When bond prices fall, bonds with shorter maturities, high coupons, and
good call protection usually decline less in price than the market as a whole.
By placing greater emphasis on those characteristics during the six-month period
ended April 30, 1999, we helped the Galaxy Massachusetts Municipal Bond Fund
make the most of a weaker market.
For the six-month reporting period, the Fund's Trust Shares earned a total
return of 1.67%. Over the same time, Retail A Shares had a total return of 1.58%
before deducting the maximum 3.75% front-end sales charge. (Please see the chart
on page 4 for total returns after deducting the front-end sales charge.)
These returns compared to 1.26% for the average Massachusetts municipal
bond fund tracked by Lipper and 1.75% for the benchmark Lehman Municipal Bond
Index.
On April 30, 1999, the Fund's Trust Shares had a 30-day SEC annualized
yield of 3.95% and Retail A Shares had a 30-day SEC annualized yield of 3.79%.
These equaled taxable yields of 6.56% and 6.29% for shareholders in the 36%
Federal income tax bracket who live in the Commonwealth of Massachusetts.
Adjusting Maturities for Rising Yields
For most of 1998, we emphasized municipals with longer maturities to make
the most of rising bond prices. During the fourth quarter, when prices seemed to
be peaking, we found more value in intermediate maturities. We also felt this
sector would perform better in a rising rate environment.
Early in 1999, we raised our cash position modestly so that we could take
advantage of an anticipated increase in yields. As we found opportunities to
deploy this cash, we continued to focus on municipals with high credit quality.
In particular, we have maintained a lower relative weighting in the uninsured
hospital sector -- which has been experiencing poor earnings and substantial
cutbacks in Medicare reimbursements.
Continued Focus on Quality
With an average maturity that is slightly longer than that of its
benchmark, the Fund should continue to perform well if the economy slows and
bonds rally. In a rally, prices for longer maturities with good call protection
tend to outperform shorter-term bonds. We would also expect credit spreads to
widen, which would cause lower-rated bonds to underperform AAA rated securities.
As a result, we expect to maintain our emphasis on municipals with high credit
quality.
Galaxy Massachusetts Municipal Bond Fund
Distribution of Total Net Assets as of April 30, 1999
Other Territories 8%
Cash Equivalents & Net Other Assets and Liabilities 2%
Massachusetts 90%
Galaxy Massachusetts Municipal Bond Fund
Growth of $10,000 investment*
Lehman Brothers Municipal Bond Index $10,000 -- $15,961
Galaxy Massachusetts Municipal Bond Fund - Retail A Shares $ 9,625 -- $13,086
Galaxy Massachusetts Municipal Bond Fund - Trust Shares $10,000 -- $13,692
*Since inception on 3/12/93. Performance figures for Retail A Shares include
the effect of the maximum 3.75% front-end sales charge. The Lehman Brothers
Municipal Bond Index is an unmanaged index in which investors cannot invest.
Results for the index do not reflect investment management fees and other
expenses incurred by the Fund. Results for the index are calculated since
3/31/93 because the index returns are calculated at month-end only.
9
<PAGE>
Portfolio Reviews
GALAXY RHODE ISLAND MUNICIPAL BOND FUND
By Glenn Migliozzi, CFA
Managing Director, Fixed Income Investments
Like the rest of the municipal market, the issuance of new municipal
securities in Rhode Island was lower over the reporting period. When product was
available, we added intermediate-term bonds, which appeared to offer the best
value. This strategy helped enhance the Galaxy Rhode Island Municipal Bond
Fund's returns during the six months ended April 30, 1999.
During the reporting period, the Fund's Retail A Shares earned a total
return of 1.50% before deducting the maximum 3.75% front-end sales charge.
(Please see chart on page 4 for total returns after deducting the front-end
sales charge.) Over the same time the average Rhode Island municipal bond fund
tracked by Lipper had a total return of 1.38%, and the Lehman Municipal Bond
Index had a total return of 1.75%.
On April 30, 1999, the Fund's Retail A Shares had a 30-day SEC annualized
yield of 3.88%. This equaled a taxable yield of 6.70% for shareholders in the
36% Federal income tax bracket who live in the State of Rhode Island.
Raising Cash
As before, we continued to focus on enhancing the Fund's yield and overall
maturity structure. To protect the value of Fund shares in the rising interest
rate environment, we raised the portfolio's cash position early in 1999. In the
months that followed, we strategically deployed these reserves to take advantage
of available product at higher yields. Given the narrow spreads between yields
for issues of different credit quality, we continued to emphasize municipals
with strong credit ratings. In particular, we employed a relative underweighting
in the hospital/healthcare sector. These issues generally underperformed,
reflecting poor earnings of hospitals and HMOs and the effect of recent changes
in Medicare.
Yield Spreads Could Widen
Although yields for municipals with lower credit ratings remain
historically close to those for AAA credits, we expect lower-quality issues to
underperform if the economy slows in coming months. Given our overall emphasis
on higher-quality issues, the Fund is well positioned for such a change.
As slower growth helps bond prices rally, the Fund should also benefit
from an average maturity that is slightly longer than that of its benchmark.
Galaxy Rhode Island Municipal Bond Fund
Distribution of Total Net Assets as of April 30, 1999
Texas 3%
Cash Equivalents & Net Other Assets and Liabilities 2%
Other Territories 20%
Rhode Island 75%
Galaxy Rhode Island Municipal Bond Fund
Growth of $10,000 investment*
Lehman Brothers Municipal Bond Index $10,000 -- $13,746
Galaxy Rhode Island Municipal Bond Fund - Retail A Shares $ 9,625 -- $13,236
*Since inception on 12/20/94 Performance figures for Retail A Shares include
the effect of the maximum 3.75% front-end sales charge. The Lehman Brothers
Municipal Bond Index is an unmanaged index in which investors cannot invest.
Results for the index do not reflect investment management fees and other
expenses incurred by the Fund. Results for the index are calculated since
12/31/94 because the index returns are calculated at month-end only.
10
<PAGE>
Shareholder Services
AUTOMATIC INVESTMENT PROGRAM
The Golden Rule of investing is "pay yourself first." That is easy to do with
Galaxy's Automatic Investment Program. For as little as $50 per month deducted
directly from your checking, savings or bank money market account, you can
consistently and conveniently add to your Galaxy investment. When you establish
an Automatic Investment Program, the $2,500 initial investment requirement for
Galaxy is waived. Of course, such a program does not assure a profit and does
not protect against loss in a declining market.
DIVERSIFICATION
A fundamental investment practice is "diversification." A well-balanced asset
allocation plan may help to control your risk while pursuing your goals. Many
mutual funds offer a low-cost way to diversify your investments while you
benefit from professional management. Galaxy's comprehensive array of investment
choices can be used in combination to match the needs of nearly everyone.
EXCHANGE PRIVILEGES
As your investment needs change, you can conveniently exchange your shares in
one fund for shares in another fund at no cost (as long as you exchange within
the same share class).
CONSOLIDATED STATEMENTS
Timely, comprehensive mutual fund account statements offer detailed information
on your individual account. If you have a FleetOne Gold or a Fleet Private
Banking Account, your Galaxy Fund information can be added to these statements.
24-HOUR ACCESS TO REGISTERED REPRESENTATIVES
24 hours a day, seven days a week, 365 days a year, we are ready and available
to help. Our toll-free telephone lines offer round-the-clock access to Fund
information and service. Call toll-free 1-877-BUY-GALAXY (1-877-289-4252) for
information on initial purchases and current performance.
- --------------------------------------------------------------------------------
Certain shareholder services may not be available to Trust Share investors.
Please consult the Fund Prospectus.
* Shares of the Funds are distributed through First Data Distributors, Inc.,
member NASD and SIPC. Investment Specialists are registered representatives of
FIS Securities, Inc., Fleet Enterprises, Inc., or Quick & Reilly, Inc., members
NASD and SIPC.
[Begin Sidebar]
"A well-balanced asset allocation plan may help to control your risk while
pursuing your goals."
[End Sidebar]
11
<PAGE>
Shareholder Information
[Begin Sidebar]
TRUSTEES
AND OFFICERS
Dwight E. Vicks, Jr.
Chairman and Trustee
John T. O'Neill
President, Treasurer
and Trustee
Louis DeThomasis,
F.S.C., Ph.D.
Trustee
Donald B. Miller
Trustee
James M. Seed
Trustee
Bradford S. Wellman
Trustee
W. Bruce
McConnel, III, Esq.
Secretary
Jylanne Dunne
Vice President and
Assistant Treasurer
William Greilich
Vice President
INVESTMENT ADVISOR
Fleet Investment
Advisors Inc.
75 State Street
Boston, MA
02109
DISTRIBUTOR
First Data
Distributors, Inc.
4400 Computer Drive
Westborough,
Massachusetts 01581-5108
ADMINISTRATOR
First Data Investor
Services Group, Inc.
4400 Computer Drive
Westborough,
Massachusetts 01581-5108
[End Sidebar]
This report is submitted for the general information of shareholders of The
Galaxy Fund. It is not authorized for distribution to prospective investors
unless accompanied or preceded by an effective prospectus for each Fund of The
Galaxy Fund, which contains more information concerning the investment policies
and expenses of the Funds as well as other pertinent information. For complete
information, and before making an investment decision on any of the Funds of The
Galaxy Fund, you should request a prospectus from First Data Distributors, Inc.
by calling toll-free 1-877-BUY-GALAXY (1-877-289-4252). Read the prospectus
carefully before you invest.
Shares of the Funds are not bank deposits or obligations of, or guaranteed or
endorsed by, Fleet Financial Group, Inc. or any of its affiliates, Fleet
Investment Advisors Inc., or any Fleet bank. Shares of the Funds are not
federally insured by, guaranteed by, obligations of or otherwise supported by
the U.S. Government, the Federal Deposit Insurance Corporation, the Federal
Reserve Board or any other governmental agency. Investment return and principal
value will vary as a result of market conditions or other factors so that shares
of the Funds, when redeemed, may be worth more or less than their original cost.
An investment in the Funds involves investment risks, including the possible
loss of principal amount invested.
[Recycled Logo]
This report was printed on recycled paper.
12
<PAGE>
Tax-Exempt Bond Fund
Portfolio of Investments
April 30, 1999 (unaudited)
<TABLE>
<CAPTION>
Par Value Value
---------- ---------
MUNICIPAL SECURITIES - 99.47%
<S> <C> <C>
Alaska - 0.77%
$ 1,275,000 Anchorage Hospital Revenue
Sisters of Providence Project
6.75%, 10/01/00 ......................... $ 1,327,594
-----------
California - 6.85%
1,000,000 California East Bay Municipal Utilities..
District Water System, Revenue
5.25%, 06/01/17 ......................... 1,031,250
2,500,000 California Educational Facilities
Authority, Stanford University,
Series O
5.13%, 01/01/31 ......................... 2,503,125
1,915,000 California Rural Home Mortgage
Finance Authority, Series A
6.35%, 12/01/29 ......................... 2,116,075
2,000,000 California State, GO
5.00%, 10/01/19
Insured: FSA ............................ 1,997,500
1,500,000 California State, GO
5.50%, 03/01/20
Insured: FSA ............................ 1,576,875
1,500,000 California State Veteran Bond, GO
Series BH
5.40%, 12/01/15
Insured: FSA ............................ 1,539,375
1,000,000 San Diego, California
Water Utilities Funding
5.38%, 08/01/12
Insured: FGIC ........................... 1,062,500
-----------
11,826,700
-----------
Colorado - 0.63%
1,000,000 Colorado Housing Finance Authority
Single Families, Series B-3
6.55%, 05/01/25 ......................... 1,095,000
-----------
Connecticut - 2.42%
1,000,000 Connecticut State Clean Water Fund
5.13%, 09/01/15 ......................... 1,030,000
1,000,000 Connecticut State HEFA
Trinity College, Series F
5.50%, 07/01/21
Insured: MBIA ........................... 1,065,000
720,000 Connecticut State Housing Finance
Authority, Housing Mortgage Finance
Program, Series A
6.10%, 05/15/13 ......................... 763,200
730,000 Connecticut State Housing Finance
Authority, Housing Mortgage Finance
Program, SubSeries B-1
6.25%, 05/15/11 ......................... 772,887
<CAPTION>
Par Value Value
---------- ---------
<S> <C> <C>
Connecticut (continued)
$ 500,000 Connecticut State Special Tax
Obligation Transportation
Infrastructure, Series B
6.10%, 09/01/07 ......................... $ 545,625
-----------
4,176,712
-----------
Florida - 6.84%
2,000,000 Florida State Board of Education
5.50%, 01/01/02 ......................... 2,092,500
2,500,000 Florida State Board of Education
Lottery Revenue, Series C
4.50%, 07/01/17
Insured: FGIC ........................... 2,356,250
2,000,000 Hillsborough County
School Board, Series A
5.50%, 07/01/14
Insured: MBIA ........................... 2,177,500
2,835,000 Miami, Dade County
Special Obligation, Series A
5.22%, 10/01/14 (A)
Insured: MBIA ........................... 1,318,275
2,690,000 Tampa Bay Water Utilities
Series B
5.13%,10/01/14
Insured: FGIC ........................... 2,770,700
1,000,000 Tampa Catholic
Health Systems, Series A-1
5.50%, 11/15/14 ......................... 1,090,000
-----------
11,805,225
-----------
Georgia - 3.80%
2,000,000 De Kalb County
Water and Sewer, Revenue
6.25%, 10/01/06 ......................... 2,262,500
1,000,000 Fulton County School District, GO
5.60%, 01/01/11 ......................... 1,085,000
3,000,000 Georgia State, GO
Series D
5.25%,10/01/12 .......................... 3,210,000
-----------
6,557,500
-----------
Idaho - 1.00%
500,000 Boise-Kuna Irrigation District
Lucky Peak Hydroelectric Project
6.60%, 07/01/05 ......................... 537,500
1,160,000 Idaho Housing & Finance Assistance
Single Family Mortgage, Senior
Series G-2, AMT
5.70%, 07/01/16 ......................... 1,189,000
-----------
1,726,500
-----------
</TABLE>
See Notes to Financial Statements.
13
<PAGE>
Tax-Exempt Bond Fund
Portfolio of Investments (continued)
April 30, 1999 (unaudited)
<TABLE>
<CAPTION>
Par Value Value
---------- ---------
<S> <C> <C>
Illinois - 3.77%
$ 1,000,000 Cook County, GO
7.25%, 11/01/07
Insured: MBIA ............................ $ 1,201,250
3,000,000 Illinois Educational Facilities Authority
Wesleyan University
5.65%, 09/01/26
Insured: MBIA ............................ 3,135,000
1,000,000 Illinois State, GO
5.80%, 09/01/18
Insured: FGIC ............................ 1,056,250
1,000,000 Regional Transportation Authority
Series A
6.25%, 06/01/15 .......................... 1,110,000
-----------
6,502,500
-----------
Indiana - 1.26%
2,000,000 Indianapolis Local Public Improvement
Bond Bank, Series A
6.00%, 01/10/18 .......................... 2,167,500
-----------
Iowa - 1.04%
1,745,000 Iowa Finance Authority Single Family
Revenue, Mortgage, Series F
5.55%, 01/01/16 .......................... 1,797,350
-----------
Kansas - 0.98%
1,575,000 Kansas State
Department of Highway Transportation
5.50%, 09/01/14 .......................... 1,689,188
-----------
Kentucky - 1.21%
1,000,000 Kentucky Housing Corp. Guaranteed
Series C-3
5.70%, 01/01/11 .......................... 1,042,500
1,000,000 Kentucky State Turnpike Authority
Economic Development, Road Revenue
Revitalization Projects
7.13%, 05/15/01
Pre-refunded 05/15/00 .................... 1,053,880
-----------
2,096,380
-----------
Louisiana - 1.45%
2,500,000 Louisana State Offshore Terminal Authority
Deepwater Port Revenue, Series A-Loop
1st Stage A-Loop, Inc.
4.25%, 09/01/08 (B)
LOC: UBS AG .............................. 2,500,000
-----------
<CAPTION>
Par Value Value
---------- ---------
<S> <C> <C>
Maine - 1.10%
$ 250,000 Maine Municipal Bond Bank
Series B
6.75%, 11/01/12 .......................... $ 279,062
500,000 Maine Municipal Bond Bank
Sewer & Water, SRF Program, Series A
6.50%, 11/01/08 .......................... 549,375
1,000,000 Maine State Housing Authority
Mortgage, Series C-1
6.50%, 11/15/11 .......................... 1,065,000
-----------
1,893,437
-----------
Maryland - 3.47%
2,875,000 Maryland State Community
Development Administration,
Department of Housing & Community
Development, Series A, AMT
5.70%, 07/01/17 .......................... 2,975,625
1,500,000 Maryland State Health & Higher
Education, Facilities Authority
Johns Hopkins University
6.00%, 07/01/10 .......................... 1,706,250
1,250,000 Montgomery County Housing
Opportunity, Commission Single
Family Mortgage Revenue
5.75%, 07/01/13 .......................... 1,310,938
-----------
5,992,813
-----------
Massachusetts - 6.38%
2,000,000 Massachusetts State HEFA
Partners Healthcare Systems, Series A
5.38%, 07/01/17
Insured: MBIA ............................ 2,055,000
200,000 Massachusetts State HEFA
South Shore Hospital, Series D
6.50%, 07/01/10
Insured: MBIA ............................ 218,000
2,000,000 Massachusetts State IFA
Tufts University, Series H
5.50%, 02/15/12
Insured: MBIA ............................ 2,157,500
1,000,000 Massachusetts State Industrial Finance
Electric Utility Revenue
Nantucket Electric, Series A, AMT
5.88%, 07/01/17
Insured: AMBAC ........................... 1,070,000
-----------
2,000,000 Massachusetts State Port Authority
Series A
5.38%, 07/01/18 .......................... 2,057,500
2,500,000 Massachusetts State Turnpike
Authority, Series A
5.00%, 01/01/39
Insured: AMBAC ........................... 2,381,250
</TABLE>
See Notes to Financial Statements.
14
<PAGE>
Tax-Exempt Bond Fund
Portfolio of Investments (continued)
April 30, 1999 (unaudited)
<TABLE>
<CAPTION>
Par Value Value
---------- ---------
<S> <C> <C>
Massachusetts (continued)
$ 1,000,000 Massachusetts State
Water Resource Authority, Series B
5.50%, 08/01/15
Insured: FSA ........................... $ 1,073,750
-----------
11,013,000
-----------
Michigan - 0.62%
1,000,000 Central Michigan University
6.00%, 10/01/13
Insured: MBIA .......................... 1,072,500
-----------
Minnesota - 0.60%
1,000,000 Rochester Health Care Facilities
Mayo Foundation, Series A
5.50%, 11/15/27
Insured: GO of Mayo Foundation ......... 1,040,000
-----------
Missouri - 2.42%
1,000,000 Missouri State HEFA
St. Louis University
5.50%, 10/01/16 ........................ 1,066,250
770,000 Missouri State
Housing and Development,
Single Family, Series B-2
6.40%, 03/01/29 ........................ 835,450
2,000,000 Sikeston Electric Revenue
6.00%, 06/01/14
Insured: MBIA .......................... 2,280,000
-----------
4,181,700
-----------
Nevada - 0.62%
1,000,000 Clark County
Series A, GO & Revenue
6.00%, 06/01/16
Pre-refunded 06/01/02
Insured: AMBAC ......................... 1,067,500
-----------
New Jersey - 2.87%
1,000,000 Mercer County Improvement
Authority Customer Receipts,
Justice Complex
6.05%, 01/01/07 ........................ 1,001,600
1,500,000 New Jersey Health Care Facilities
Financing, AHS Hospital Corp.
Series A
6.00%, 07/01/12
Insured: AMBAC ......................... 1,700,625
1,700,000 New Jersey Health Care Facilities
Finance Authority, Medical
Center at Princeton
5.13%, 07/01/18
Insured: AMBAC ......................... 1,708,500
<CAPTION>
Par Value Value
---------- ---------
<S> <C> <C>
New Jersey (continued)
$ 500,000 New Jersey State
Transportation Systems
Series A
5.50%, 06/15/09 ........................ $ 546,875
-----------
4,957,600
-----------
New Mexico - 1.22%
750,000 Dona Ana County
Gross Receipt Tax Revenue
5.50%, 06/01/16
Insured: AMBAC ......................... 800,625
1,285,000 New Mexico Mortgage Finance
Authority Single Family Mortgage
Series B-3
5.50%, 07/01/28
Insured: Fannie Mae/
GNMA/FHLMC ............................. 1,305,881
-----------
2,106,506
-----------
New York - 11.36%
1,000,000 Battery Park City Authority
Senior Lien, Series A
5.50%, 11/01/10 ........................ 1,050,000
2,165,000 Metropolitan Transportation Authority
Dedicated Tax Fund, Series C-1
5.25%, 07/01/17
Insured: FGIC .......................... 2,213,712
1,000,000 Municipal Assistance Corp. for City
of New York, Series O
5.25%, 07/01/07
Insured: GO of Municipal
Assistance Corp. ....................... 1,071,250
1,500,000 New York City Transitional Finance
Authority Revenue, Series C
5.00%, 05/01/26 ........................ 1,453,125
1,000,000 New York Municipal Water Finance
Authority, Water and Sewer System
Series A
5.50%, 06/15/11 ........................ 1,040,000
2,110,000 New York State Dormitory Authority
Columbia University
5.00%, 07/01/18 ........................ 2,112,638
4,000,000 New York State Dormitory Authority
Capital Appreciation, State University
5.18%, 05/15/10 (A)
Insured: MBIA .......................... 2,415,000
1,000,000 New York State Dormitory Authority
Municipal Health Facilities Improvement
PG-Series I
5.00%, 01/15/09
Insured: FSA .......................... 1,042,500
30,000 New York State Dormitory Authority
University of Rochester
6.50%, 07/01/09 ....................... 30,497
</TABLE>
See Notes to Financial Statements.
15
<PAGE>
Tax-Exempt Bond Fund
Portfolio of Investments (continued)
April 30, 1999 (unaudited)
<TABLE>
<CAPTION>
Par Value Value
---------- ---------
<S> <C> <C>
New York (continued)
$ 250,000 New York State, GO
6.10%, 11/15/09 ......................... $ 271,875
1,000,000 New York State, GO
5.50%, 06/15/10 ......................... 1,057,500
2,000,000 New York State, GO
Series F
5.25%, 09/15/12 ......................... 2,095,000
1,000,000 New York State, GO
Series I
6.00%, 04/15/09 ......................... 1,108,750
1,000,000 Port Authority of New York &
New Jersey, JFK International Air
Terminal, Series 6, SP OB, AMT
6.00%, 12/01/07
Insured: MBIA ........................... 1,116,250
1,500,000 Triborough Bridge & Tunnel Authority
5.00%, 01/01/01
Insured: GO of Authority ................ 1,535,625
-----------
19,613,722
-----------
North Carolina - 1.48%
1,500,000 Charlotte Certificates of Participation
Convention Facility Project
6.35%, 12/01/00
Insured: AMBAC .......................... 1,567,500
925,000 North Carolina Housing Finance
Agency Single Family Revenue
Series Y
6.30%, 09/01/15 ......................... 982,812
-----------
2,550,312
-----------
Ohio - 3.90%
955,000 Cleveland Waterworks
First Mortgage, Series F-92 A
6.25%, 01/01/15
Insured: AMBAC .......................... 1,033,788
1,000,000 Cleveland Waterworks
Refunding & Improvement
First Mortgage
5.50%, 01/01/10
Insured: MBIA ........................... 1,073,750
45,000 Cleveland Waterworks Revenue
6.25%, 01/01/15
Insured: AMBAC .......................... 48,262
1,460,000 Forest Hills School District, GO
6.00%, 12/01/10
Insured: MBIA ........................... 1,653,450
1,000,000 Ohio State Building Authority
State Facilities, Adult Correctional
Series A
6.00%, 04/01/06
Insured: AMBAC .......................... 1,108,750
<CAPTION>
Par Value Value
---------- ---------
<S> <C> <C>
Ohio (continued)
$ 1,785,000 Ohio State Water Development
Authority Pollution Center, Facilities,
Water Control Loan Fund,
Water Quality Series
5.00%, 12/01/15
Insured: MBIA ........................... $ 1,807,313
-----------
6,725,313
-----------
Pennsylvania - 4.79%
2,000,000 Delaware Valley Regional Finance
Authority, Local Government Revenue
Series B
5.60%, 07/01/17
Insured: AMBAC .......................... 2,170,000
2,210,000 Elizabeth Forward School District
Capital Appreciation, Series B, GO
5.52%, 09/01/21 (A)
Insured: MBIA ........................... 715,488
2,210,000 Elizabeth Forward School District
Capital Appreciation, Series B, GO
5.52%, 09/01/22 (A)
Insured: MBIA ........................... 676,813
1,000,000 Luzerne County, Series B, GO
6.00%, 09/15/11
Insured: FGIC ........................... 1,025,000
1,500,000 Pennsylvania Housing Finance Agency
Single Family Mortgage
Series 59-A, AMT
5.75%, 10/01/23 ......................... 1,552,500
1,000,000 Pennsylvania State Higher Educational
Facilities Authority
Temple University, First Series
5.25%, 04/01/14
Insured: MBIA ........................... 1,040,000
1,000,000 Pennsylvania State
Second Series A, GO
6.50%, 11/01/04
Pre-refunded 11/01/01
Insured: MBIA ........................... 1,082,500
-----------
8,262,301
-----------
Rhode Island - 3.35%
200,000 Rhode Island Clean Water Protection
Finance Agency, Revolving Fund
Pooled Loan Issue, Series A
6.75%, 10/01/13
Insured: MBIA ........................... 222,687
700,000 Rhode Island Housing & Mortgage
Finance, Homeownership Opportunity
Series 13
6.70%, 10/01/15 ......................... 747,250
1,000,000 Rhode Island Housing & Mortgage
Finance, Homeownership Opportunity
Series 19-A
5.70%, 04/01/15 ......................... 1,030,000
</TABLE>
See Notes to Financial Statements.
16
<PAGE>
Tax-Exempt Bond Fund
Portfolio of Investments (continued)
April 30, 1999 (unaudited)
<TABLE>
<CAPTION>
Par Value Value
---------- ---------
<S> <C> <C>
Rhode Island (continued)
$ 1,500,000 Rhode Island State Health &
Educational Building Corp., Higher
Education, Johnson & Wales University
6.38%, 04/01/12
Insured: Connie Lee ..................... $ 1,644,375
1,500,000 Rhode Island State Health & Educational
Building Corp., Higher Education
Johnson & Wales University, Series A
5.75%, 04/01/12
Insured: Connie Lee ..................... 1,591,875
500,000 Rhode Island State Health & Educational
Building Corp., Miriam Hospital
Series B
6.50%, 04/01/13
Pre-refunded 04/01/03 ................... 556,250
-----------
5,792,437
-----------
South Carolina - 2.97%
1,500,000 Greenville Waterworks, Revenue
5.50%, 02/01/22 ......................... 1,545,000
2,100,000 Oconee County, PCR
Duke Power Co. Project
5.80%, 04/01/14 ......................... 2,241,750
500,000 Piedmont Municipal
Power Agency Electric
6.10%, 01/01/06
Insured: MBIA ........................... 556,875
750,000 Richland County
Certificates of Participation
6.90%, 02/01/01
Insured: FGIC ........................... 792,188
-----------
5,135,813
-----------
South Dakota - 0.62%
1,000,000 Rapid City Sales Tax
Series B
6.20%, 06/01/12
Insured: FGIC ........................... 1,070,000
-----------
Tennessee - 2.20%
500,000 Memphis Water Revenue
Series A
6.00%, 01/01/07 ......................... 534,375
2,000,000 Metropolitan Government Nashville &
Davidson County, GO
5.88%, 05/15/26 ......................... 2,185,000
1,000,000 Metropolitan Government Nashville &
Davidson County Health & Education
Facilities Board, Vanderbilt University
Series B
6.30%, 10/01/14 ......................... 1,078,750
-----------
3,798,125
-----------
<CAPTION>
Par Value Value
---------- ---------
<S> <C> <C>
Texas - 11.54%
$ 1,000,000 Amarillo Texas Health Facilities Corp
Baptist St. Anthony Hospital Corp.
5.50%, 01/01/14
Insured: FSA ............................ $ 1,073,750
5,000,000 Harris County Capital Appreciation
Series A, GO & Revenue
5.18%, 08/15/07 (A)
Insured: FGIC ........................... 3,481,250
2,000,000 Harris County Health Facilities
Development Corp., Medical Facilities
Baylor College, Series A
5.00%, 11/15/28
Insured: AMBAC .......................... 1,917,500
2,170,000 Harris County Health Facilities
Development Corp., Memorial Hospital
System Project, Series A
6.00%, 06/01/13
Insured: MBIA ........................... 2,438,537
4,000,000 Houston Water & Sewer System
Junior Lien, Series C
5.35%, 12/01/11 (A)
Insured: AMBAC .......................... 2,220,000
1,775,000 Katy, Texas Independent School District
Capital Appreciation Refunded
3.56%, 08/15/11 (A) ..................... 989,562
1,750,000 Lower Colorado River Authority
Capital Appreciation, Junior Lien
4th Supplement
5.45%, 01/01/13 (A)
Insured: FGIC ........................... 899,062
2,000,000 Lower Neches Valley Authority, IDC
Mobil Oil Refining Project
5.80%, 05/01/22 ......................... 2,112,500
2,000,000 New Braunfels Independent School
District, Capital Appreciation, GO
5.23%, 02/01/07 (A) ..................... 1,422,500
1,000,000 North Central Health Facilities
Development Corp., Hospital
Presbyterian Healthcare
5.90%, 06/01/21
Pre-refunded 06/01/05 ................... 1,097,500
2,000,000 San Antonio Airport System
7.13%, 07/01/05
Insured: AMBAC .......................... 2,272,500
-----------
19,924,661
-----------
Virginia - 1.25%
1,000,000 Norfolk Industrial Development
Authority Childrens Hospital
Kings Group
6.50%, 06/01/21
Insured: AMBAC .......................... 1,062,500
1,025,000 Virginia State, GO
5.38%, 06/01/04 ......................... 1,099,313
-----------
2,161,813
-----------
</TABLE>
See Notes to Financial Statements.
17
<PAGE>
Tax-Exempt Bond Fund
Portfolio of Investments (continued)
April 30, 1999 (unaudited)
<TABLE>
<CAPTION>
Par Value Value
--------- ---------
<S> <C> <C>
Washington - 1.47%
$ 1,370,000 Seattle, GO
Series A
5.50%, 03/01/11 ....................... $ 1,489,875
1,000,000 Washington State Public Power Supply
System, Nuclear Project No. 2, Series C
7.30%, 07/01/00 ....................... 1,042,500
-------------
2,532,375
-------------
West Virginia - 1.24%
2,000,000 West Virginia School Building Authority
Capital Improvement
5.50%, 07/01/11
Insured: AMBAC ........................ 2,137,500
Other Territories - 1.98%
3,000,000 Puerto Rico Electric Power Authority
Series BB
6.00%, 07/01/12
Insured: MBIA ......................... 3,420,000
-------------
Total Municipal Securities 171,717,577
-------------
(Cost $165,135,816)
<CAPTION>
Shares Value
--------- ---------
<S> <C> <C>
INVESTMENT COMPANY - 0.08%
128,535 Federated Tax-Free Obligations Fund ... $ 128,535
-------------
Total Investment Company 128,535
-------------
(Cost $128,535)
Total Investments - 99.55% .............................. 171,846,112
-------------
(Cost $165,264,351)
Net Other Assets and Liabilities - 0.45% ................ 782,008
-------------
Net Assets - 100.00% .................................... $ 172,628,120
=============
</TABLE>
- --------------------------------
(A) Zero Coupon Bond. Rate shown reflects effective yield to maturity at
time of purchase.
(B) Interest is reset once a month. The interest rate shown reflects the
rate in effect at April 30, 1999.
AMBAC American Municipal Bond Assurance Corp.
AMT Alternative Minimum Tax. Private activity obligations the interest
on which is subject to the federal AMT for individuals.
Connie Lee College Construction Loan Association
FGIC Federal Guaranty Insurance Corp.
FHLMC Federal Home Loan Mortgage Corp.
FSA Financial Security Assurance Company
GNMA Government National Mortgage Association
GO General Obligation
HEFA Health and Educational Facilities Authority
IDC Industrial Development Corp.
IFA Industrial Finance Agency
LOC Letter of Credit
MBIA Municipal Bond Insurance Association
PCR Pollution Control Revenue
SP OB Special Obligation
See Notes to Financial Statements.
18
<PAGE>
New Jersey Municipal Bond Fund
Portfolio of Investments
April 30, 1999 (unaudited)
<TABLE>
<CAPTION>
Par Value Value
---------- ---------
<S> <C> <C>
MUNICIPAL SECURITIES - 98.03%
California - 2.14%
$ 100,000 Los Angeles Regional Airports
Improvement Corp.
American Airlines, Series C
4.25%, 12/01/24 (A)
LOC: Wachovia Bank, N.A. ................. $ 100,000
100,000 Los Angeles Regional Airports
Improvement Corp.
American Airlines, Series F
4.25%, 12/01/24 (A)
LOC: Wachovia Bank, N.A. ................. 100,000
-----------
200,000
-----------
Louisiana - 2.14%
200,000 Louisana State Offshore Terminal Authority
Deepwater Port Revenue
1st Stage A-Loop, Inc.
4.25%, 09/01/08 (A)
LOC: UBS AG .............................. 200,000
-----------
New Jersey - 86.59%
235,000 Freehold Board of Education, GO
5.38%, 07/15/10
Insured: FSA ............................. 249,981
250,000 Lacey Municipal Utilities Authority
New Jersey Water Revenue
5.10%, 12/01/16
Insured: MBIA ............................ 251,562
250,000 Lenape Regional High School
District, GO
5.00%, 04/01/08
Insured: FGIC ............................ 262,188
50,000 Lenape Regional High School
District, GO
5.00%, 04/01/12
Insured: FGIC ............................ 51,187
250,000 Mercer County Improvement
Authority Revenue Youth Center
Series B
5.00%, 02/15/14
Insured: FGIC ............................ 254,063
250,000 Metuchen School District, GO
5.13%, 09/15/12
Insured: FGIC ............................ 258,437
250,000 Middlesex County
Certificate of Participation
4.63%, 02/15/11
Insured: MBIA ............................ 249,375
50,000 Monmouth County Improvement
Authority Revenue Governmental Loan
5.50%, 12/01/07
Insured: AMBAC ........................... 54,563
<CAPTION>
Par Value Value
---------- ---------
<S> <C> <C>
New Jersey (continued)
$ 100,000 Morristown, GO
5.15%, 02/01/09
Insured: FSA ............................. $ 105,375
250,000 New Brunswick, GO
4.80%, 09/15/13
Insured: MBIA ............................ 252,187
250,000 New Jersey Development Authority
Educational Testing Service, Series A
4.00%, 05/15/06 .......................... 248,125
200,000 New Jersey Economic Development
Authority Water Facilities
4.00%, 11/01/25 (A)
Insured: AMBAC ........................... 200,000
75,000 New Jersey
Environmental Infrastructure
Wastewater Treatment, Series F
5.00%, 04/01/14
Insured: MBIA ............................ 76,313
500,000 New Jersey
Environmental Infrastructure
Wastewater Treatment, Series G
5.00%, 04/01/12
Insured: FGIC ............................ 513,750
500,000 New Jersey Health Care Facilities
Financing Authority Revenue
Hackensack University Medical Center
Series A
5.38%, 01/01/13
Insured: MBIA ............................ 523,750
300,000 New Jersey Health Care Facilities
Financing Authority Revenue
Medical Center at Princeton
5.13%, 07/01/18
Insured: AMBAC ........................... 301,500
50,000 New Jersey Health Care Facilities
Kennedy Healthcare Sytems, Series B
5.00%, 07/01/09
Insured: MBIA ............................ 52,250
190,000 New Jersey Sports & Exposition
Authority Convention Center
Luxury Tax Revenue, Series A
6.00%, 07/01/13
Insured: MBIA ............................ 206,625
50,000 New Jersey State, GO
7.00%, 04/01/07
Pre-refunded 04/01/01 .................... 53,813
1,000,000 New Jersey State, GO
5.00%, 03/01/11 .......................... 1,037,500
75,000 New Jersey State, GO
Series D
5.40%, 02/15/03 .......................... 79,500
250,000 New Jersey State Building Authority
6.00%, 06/15/07 .......................... 280,312
250,000 New Jersey State
Educational Facilities Authority
Richard Stockton College, Series C
5.10%, 07/01/23
Insured: AMBAC ........................... 248,125
</TABLE>
See Notes to Financial Statements.
19
<PAGE>
New Jersey Municipal Bond Fund
Portfolio of Investments (continued)
April 30, 1999 (unaudited)
<TABLE>
<CAPTION>
Par Value Value
---------- ---------
<S> <C> <C>
New Jersey (continued)
$ 250,000 New Jersey State Higher Education
Assistance Authority
Student Loan Revenue, Series A
5.30%, 06/01/17
Insured: AMBAC .......................... $ 248,438
445,000 New Jersey State
Housing and Mortgage
Finance Authority
Home Buyer, Series G
4.63%, 04/01/15
Insured: MBIA ........................... 448,894
400,000 New Jersey State Transportation Corp.
Certificates, Series A
3.80%, 09/15/04
Insured: AMBAC .......................... 398,888
250,000 New Jersey State
Transportation Systems, Series A
5.50%, 06/15/09 ......................... 273,437
50,000 Old Tappan Board of Education, GO
5.10%, 04/01/15
Insured: FGIC ........................... 51,063
50,000 Plumstead Board of Education, GO
5.00%, 03/01/14
Insured: FGIC ........................... 51,125
250,000 Port Authority of New York &
New Jersey
5.00%, 12/01/15 ......................... 248,750
250,000 Somerset Raritan Valley, New Jersey
Sewer Authority, Series A
5.25%, 07/01/12
Insured: MBIA ........................... 259,375
250,000 Wall Township New Jersey
School District, GO
4.35%, 07/15/05
Insured: FSA ............................ 254,687
50,000 Woodbridge Sewer and Utility
6.80%, 08/01/05
Pre-refunded 08/01/00 ................... 52,500
------------
8,097,638
------------
<CAPTION>
Par Value Value
---------- ---------
<S> <C> <C>
Other Territories - 7.16%
$ 60,000 Puerto Rico Commonwealth, GO
7.63%, 07/01/10
Pre-refunded 07/01/00 ................... $ 64,125
250,000 Puerto Rico Commonwealth, GO
6.00%, 07/01/16
Insured: MBIA ........................... 286,250
250,000 Puerto Rico Commonwealth
Infrastructure, Series A
Financing Authority Special Tax
5.13%, 07/01/09
Insured: AMBAC .......................... 267,813
50,000 Puerto Rico
Electric Power Authority, Series AA
5.25%, 07/01/17
Insured: MBIA ........................... 51,500
-----------
669,688
-----------
Total Municipal Securities .............. 9,167,326
(Cost $9,053,373) -----------
Shares
-----
INVESTMENT COMPANY - 1.15%
107,891 Federated Tax-Free Obligations Fund ..... 107,891
-----------
Total Investment Company ................ 107,891
(Cost $107,891) -----------
Total Investments - 99.18% ................................ 9,275,217
(Cost $9,161,264) -----------
Net Assets and Other Liabilities - 0.82% .................. 76,684
-----------
Net Assets - 100.00% ...................................... $ 9,351,901
===========
</TABLE>
- ----------------------------
(A) Interest is reset once a month. The interest rate shown reflects the
rate in effect at April 30, 1999.
AMBAC American Municipal Bond Assurance Corp.
FGIC Federal Guaranty Insurance Corp.
FSA Financial Security Assurance Company
GO General Obligation
LOC Letter of Credit
MBIA Municipal Bond Insurance Association
See Notes to Financial Statements.
20
<PAGE>
New York Municipal Bond Fund
Portfolio of Investments
April 30, 1999 (unaudited)
<TABLE>
<CAPTION>
Par Value Value
---------- ---------
<S> <C> <C>
MUNICIPAL SECURITIES - 98.44%
Louisiana - 1.05%
$ 900,000 Louisana State Offshore Terminal Authority
Deepwater Port Revenue
1st Stage A-Loop, Inc.
4.25%, 09/01/08 (A)
LOC: UBS AG .............................. $ 900,000
-----------
New York - 95.18%
1,000,000 Albany County, GO
5.50%, 06/01/08
Insured: FGIC ............................ 1,076,250
1,000,000 Albany County Airport Authority
5.38%, 12/15/17
Insured: FSA ............................. 1,021,250
100,000 Canandaigua City
School District, GO
6.50%, 06/01/10
Insured: AMBAC ........................... 117,625
1,000,000 Dutchess County
Waste Water Authority Service Agreement
Series 1
5.38%, 06/01/19 .......................... 1,002,500
2,000,000 Long Island Power Authority
New York Electric System
Revenue, Series A
5.50%, 12/01/12
Insured: FSA ............................. 2,177,500
1,000,000 Metropolitan Transportation Authority
Dedicated Tax Fund, Series A
5.50%, 04/01/16
Insured: MBIA ............................ 1,051,250
1,000,000 Metropolitan Transportation Authority
Dedicated Tax Fund, Series C-1
5.25%, 07/01/17
Insured: FGIC ............................ 1,022,500
750,000 Monroe County
Public Improvement, GO
6.10%, 03/01/09
Insured: MBIA ............................ 797,531
900,000 Monroe County
Public Improvement, GO
6.10%, 06/01/14
Pre-refunded 06/01/04
Insured: AMBAC ........................... 1,006,875
1,000,000 Monroe County Water Authority
Series A
6.25%, 08/01/11 .......................... 1,066,250
1,000,000 Monroe Woodbury
Central School District, GO
5.63%, 05/15/18
Insured: MBIA ............................ 1,055,000
<CAPTION>
Par Value Value
---------- ---------
<S> <C> <C>
New York (continued)
$ 1,500,000 Municipal Assistance Corporation
for New York City, New York
Series L
6.00%, 07/01/08 .......................... $ 1,685,625
1,000,000 Municipal Assistance Corporation
for New York City, New York
Series O
5.25%, 07/01/07
Insured: GO of Municipal
Assistance Corp. ......................... 1,071,250
500,000 New Castle Public Improvement, GO
5.88%, 09/15/09 .......................... 538,125
1,000,000 New York, GO, Series I
6.00%, 04/15/09 .......................... 1,108,750
2,060,000 New York City
Capital Appreciation, Series F, GO
4.59%, 08/01/08 (B)
Insured: MBIA ............................ 1,375,050
3,500,000 New York City
Capital Appreciation, Series G, GO
4.65%, 08/01/08 (B)
Insured: MBIA ............................ 2,336,250
1,000,000 New York City, IDA
Civic Facility
Trinity Episcopal School Corp. Project
5.25%, 06/15/17
Insured: MBIA ............................ 1,018,750
500,000 New York City Municipal Water
Finance Authority
Water & Sewer System, Series A
6.10%, 06/15/06 .......................... 535,625
2,000,000 New York City Municipal Water
Finance Authority
Water & Sewer System, Series A
5.13%, 06/15/15 .......................... 2,025,000
1,000,000 New York City Municipal Water
Finance Authority
Water & Sewer System, Series A
6.00%, 06/15/17 .......................... 1,062,500
1,000,000 New York City Municipal Water
Finance Authority
Water & Sewer System, Series A
5.75%, 06/15/18
Insured: AMBAC ........................... 1,051,250
750,000 New York City Municipal Water
Finance Authority
Water & Sewer System, Series B
5.75%, 06/15/13
Insured: MBIA ............................ 807,188
1,000,000 New York City Municipal Water
Finance Authority
Water & Sewer System, Series B
5.75%, 06/15/26
Insured: MBIA ............................ 1,068,750
</TABLE>
See Notes to Financial Statements.
21
<PAGE>
New York Municipal Bond Fund
Portfolio of Investments (continued)
April 30, 1999 (unaudited)
<TABLE>
<CAPTION>
Par Value Value
---------- ---------
<S> <C> <C>
New York (continued)
$ 2,750,000 New York City
Transitional Finance Authority
Revenue, Series C
5.00%, 05/01/26 .......................... $ 2,664,062
2,000,000 New York City Trust
Cultural Resources
American Museum
of National History, Series A
5.60%, 04/01/18
Insured: MBIA ............................ 2,100,000
1,000,000 New York State, GO
6.25%, 09/15/07 .......................... 1,097,500
100,000 New York State, GO
6.90%, 02/01/08 .......................... 110,125
1,000,000 New York State, GO
6.13%, 11/15/10 .......................... 1,088,750
2,500,000 New York State, GO
5.25%, 09/15/13 .......................... 2,612,500
3,000,000 New York State, GO
5.25%, 03/01/15 .......................... 3,086,250
2,000,000 New York State Dormitory Authority
Columbia University
5.00%, 07/01/18 .......................... 2,002,500
1,030,000 New York State Dormitory Authority
Cornell University
5.40%, 07/01/12 .......................... 1,086,650
1,675,000 New York State Dormitory Authority
Fordham University
5.00%, 07/01/28
Insured: MBIA ............................ 1,635,219
1,000,000 New York State Dormitory Authority
Ithaca College
5.00%, 07/01/21 .......................... 985,000
1,000,000 New York State Dormitory Authority
Lease Revenue Municipal Health
Facilities Improvement, Series 1
5.13%, 01/15/14
Insured: FSA ............................. 1,023,750
1,175,000 New York State Dormitory Authority
Mt. Sinai School of Medicine, Series B
5.70%, 07/01/11
Insured: MBIA ............................ 1,291,031
500,000 New York State Dormitory Authority
New York University
6.25%, 07/01/09
Insured: FGIC ............................ 531,250
1,000,000 New York State Dormitory Authority
New York University, Series A
6.00%, 07/01/17
Insured: MBIA ............................ 1,132,500
2,225,000 New York State Dormitory Authority
Rochester Institute of Technology
5.30%, 07/01/17
Insured: MBIA ............................ 2,283,406
<CAPTION>
Par Value Value
---------- ---------
<S> <C> <C>
New York (continued)
$ 1,500,000 New York State Dormitory Authority
Rockefeller University
5.00%, 07/01/28 .......................... $ 1,475,625
1,000,000 New York State Dormitory Authority
State University Educational Facilities,
Series B
5.25%, 05/15/12 .......................... 1,035,000
15,000 New York State Dormitory Authority
University of Rochester
6.50%, 07/01/09 .......................... 15,248
1,125,000 New York State Dormitory Authority
University of Rochester, Series A
5.00%, 07/01/27
Insured: MBIA ............................ 1,098,281
1,000,000 New York State Dormitory Authority
Revenues Service Contract
Community Enhancement
4.00%, 04/01/00 .......................... 1,003,680
100,000 New York State Environmental
Facilities Corp., State Water
Revolving Fund, PCR
Pooled Loan, Series A
6.40%, 09/15/06 .......................... 109,500
1,000,000 New York State Environmental
Facilities Corp., State Water
Revolving Fund, PCR
Pooled Loan, Series A
5.40%, 09/15/07 .......................... 1,063,750
500,000 New York State Environmental
Facilities Corp., State Water
Revolving Fund, PCR
Pooled Loan, Series B
6.50%, 09/15/08 .......................... 547,500
100,000 New York State Environmental
Facilities Corp., State Water
Revolving Fund, PCR, Series E
6.88%, 06/15/10
Pre-refunded 06/15/01 .................... 108,625
1,000,000 New York State Environmental
Facilities Corp., State Clean Water and
Drinking Water, Revolving Fund, Series F
5.25%, 06/15/12 .......................... 1,048,750
1,000,000 New York State Environmental
Facilities Corp., State Water
Subordinated Revolving Fund, PCR
Series E
5.00%, 06/15/13
Insured: MBIA ............................ 1,018,750
500,000 New York State Housing
Finance Agency Multifamily Mortgage
Housing, Series A
6.95%, 08/15/12 .......................... 540,625
</TABLE>
See Notes to Financial Statements.
22
<PAGE>
New York Municipal Bond Fund
Portfolio of Investments (continued)
April 30, 1999 (unaudited)
<TABLE>
<CAPTION>
Par Value Value
---------- ---------
<S> <C> <C>
New York (continued)
$ 300,000 New York State Local
Assistance Corp., Series A
6.88%, 04/01/06
Pre-refunded 04/01/02 .................... $ 331,875
1,000,000 New York State Local
Assistance Corp., Series B
6.00%, 04/01/18 .......................... 1,081,250
1,500,000 New York State Local
Assistance Corp.,Series E
6.00%, 04/01/14
Insured: GO of New York State
Local Assistance Corp. ................... 1,668,750
800,000 New York State Medical Care Facilities
Finance Agency
Second Mortgage Program
Health Care Projects, Series B
6.35%, 11/01/14 .......................... 851,000
500,000 New York State Mortgage Agency
Homeowner Mortgage, Series 27
6.90%, 04/01/15 .......................... 535,000
3,000,000 New York State Mortgage Agency
Homeowner Mortgage, Series 67
5.70%, 10/01/17 .......................... 3,071,250
145,000 New York State Mortgage Agency
Revenue, 8th Series
6.88%, 04/01/17 .......................... 145,257
1,000,000 New York State Power Authority
Revenue, General Purpose, Series AA
6.38%, 01/01/12 .......................... 1,086,250
500,000 New York State Power Authority
Revenue, General Purpose, Series Z
6.63%, 01/01/12 .......................... 545,625
1,250,000 New York State Thruway Authority
Revenue, Series A
5.88%, 01/01/07 .......................... 1,339,063
500,000 Onondaga County, GO
5.88%, 02/15/10 .......................... 558,125
100,000 Orleans County, GO
6.50%, 09/15/08 .......................... 116,125
1,000,000 Port Authority of New York
and New Jersey
JFK International Air Terminal
6.00%, 12/01/07
Insured: MBIA ............................ 1,116,250
200,000 Port Authority of New York
and New Jersey
Consolidated Loan, Series 71
6.90%, 07/15/09 .......................... 212,000
500,000 Port Authority of New York
and New Jersey
Consolidated Loan, Series 78
6.50%, 04/15/11 .......................... 535,625
545,000 Rensselaer County, GO
5.25%, 06/01/11
Insured: AMBAC ........................... 580,425
<CAPTION>
Par Value Value
---------- ---------
<S> <C> <C>
New York (continued)
$ 1,315,000 Triborough Bridge and
Tunnel Authority, Revenue
General Purpose, Series A
5.13%, 01/02/22 .......................... $ 1,315,000
500,000 Triborough Bridge and
Tunnel Authority, Revenue
General Purpose, Series X
6.00%, 01/01/06 .......................... 526,250
500,000 Triborough Bridge and
Tunnel Authority, Revenue
General Purpose, Series X
6.00%, 01/01/07 .......................... 525,000
750,000 Triborough Bridge and
Tunnel Authority, Revenue
General Purpose, Series X
6.00%, 01/01/08 .......................... 787,500
300,000 Triborough Bridge and
Tunnel Authority, Revenue
General Purpose, Series X
6.63%, 01/01/12 .......................... 356,250
750,000 Triborough Bridge and
Tunnel Authority, Revenue
General Purpose, Series Y
6.00%, 01/01/12 .......................... 848,437
100,000 Triborough Bridge and
Tunnel Authority, Revenue, SP OB
6.10%, 01/01/05
Insured: FGIC ............................ 107,375
250,000 Triborough Bridge and
Tunnel Authority, Revenue, SP OB
6.15%, 01/01/06
Insured: FGIC ............................ 268,688
500,000 United Nations Development Corp.
Senior Lien, Series A
6.00%, 07/01/06
Pre-refunded 07/01/03 .................... 551,875
1,000,000 United Nations Development Corp.
Senior Lien, Series A
6.00%, 07/01/12
Pre-refunded 07/01/03 .................... 1,103,750
500,000 United Nations Development Corp.
Subordinated Lien, Series B
6.20%, 07/01/11
Pre-refunded 07/01/03 .................... 555,625
------------
81,594,091
------------
Pennsylvania - 0.88%
2,210,000 Elizabeth Forward School District
Capital Appreciation, Series B, GO
5.68%, 09/01/20 (B) ...................... 754,163
------------
</TABLE>
See Notes to Financial Statements.
23
<PAGE>
New York Municipal Bond Fund
Portfolio of Investments (continued)
April 30, 1999 (unaudited)
<TABLE>
<CAPTION>
Par Value Value
---------- ---------
<S> <C> <C>
Other Territories - 1.33%
$ 1,000,000 Puerto Rico Electric Power Authority
Series BB
6.00%, 07/01/12
Insured: MBIA ............................ $ 1,140,000
------------
Total Municipal Securities ............... 84,388,254
(Cost $80,751,608) ------------
Shares
------
INVESTMENT COMPANY - 0.41%
347,893 New York Federated Municipal Cash Trust .. 347,893
------------
Total Investment Company ................. 347,893
(Cost $347,893) ------------
Total Investments - 98.85% ................................. 84,736,147
(Cost $81,099,501) ------------
Net Assets and Other Liabilities - 1.15% ................... 987,639
------------
Net Assets - 100.00% ....................................... $ 85,723,786
============
</TABLE>
- ----------------------------
(A) Interest is reset once a month. The interest rate shown reflects the rate
in effect at April 30, 1999.
(B) Zero Coupon Bond. Rate shown reflects effective yield to maturity at time
of purchase.
AMBAC American Municipal Bond Assurance Corp.
FGIC Federal Guaranty Insurance Corp.
FSA Financial Security Assurance Company
GO General Obligation
IDA Industrial Development Agency
LOC Letter of Credit
MBIA Municipal Bond Insurance Association
PCR Pollution Control Revenue
SP OB Special Obligation
See Notes to Financial Statements.
24
<PAGE>
Connecticut Municipal Bond Fund
Portfolio of Investments
April 30, 1999 (unaudited)
<TABLE>
<CAPTION>
Par Value Value
---------- ---------
<S> <C> <C>
MUNICIPAL SECURITIES - 98.69%
Connecticut - 85.71%
$ 250,000 Cheshire, GO
5.10%, 08/15/07 .......................... $ 264,687
885,000 Colchester, GO, Lot A
5.40%, 08/15/10
Insured: AMBAC ........................... 961,331
400,000 Connecticut State Airport Revenue
Bradley International Airport
7.40%, 10/01/04
Insured: FGIC ............................ 459,000
500,000 Connecticut State Airport Revenue
Bradley International Airport
7.65%, 10/01/12
Insured: FGIC ............................ 582,500
325,000 Connecticut State Clean Water Fund
5.50%, 10/01/04 .......................... 352,625
500,000 Connecticut State Clean Water Fund
7.00%, 01/01/11 .......................... 536,250
200,000 Connecticut State Clean Water Fund
6.00%, 10/01/12 .......................... 226,000
250,000 Connecticut State, GO, Series A
5.10%, 11/15/04 .......................... 265,938
1,000,000 Connecticut State, GO, Series A
5.13%, 03/01/10 .......................... 1,055,000
400,000 Connecticut State, GO, Series B
5.40%, 03/15/08 .......................... 436,000
1,000,000 Connecticut State, GO, Series B
5.38%, 10/01/11 .......................... 1,056,250
500,000 Connecticut State, GO, Series C
5.50%, 08/15/05 .......................... 541,875
500,000 Connecticut State, GO, Series E
6.00%, 03/15/12 .......................... 565,625
500,000 Connecticut State HEFA
Backus (William W.) Hospital Issue
Series D
5.63%, 07/01/17
Insured: AMBAC ........................... 529,375
750,000 Connecticut State HEFA
Greenwich Hospital Issue, Series A
5.30%, 07/01/08
Insured: MBIA ............................ 805,312
250,000 Connecticut State HEFA
Hospital for Special Care Issue
Series B
5.38%, 07/01/17 .......................... 247,813
1,060,000 Connecticut State HEFA
Middlesex Hospital, Series H
5.00%, 07/01/12
Insured: MBIA ............................ 1,082,525
375,000 Connecticut State HEFA
Newington Childrens Hospital
Series A
5.65%, 07/01/05
Insured: MBIA ............................ 405,937
<CAPTION>
Par Value Value
---------- ---------
<S> <C> <C>
Connecticut (continued)
$ 500,000 Connecticut State HEFA
Trinity College, Series F
5.50%, 07/01/21
Insured: MBIA ............................ $ 532,500
1,000,000 Connecticut State HEFA
Yale-New Haven Hospital
Series F
7.10%, 07/01/25
Insured: MBIA ............................ 1,061,250
200,000 Connecticut State HFA
Housing Mortgage Finance Program
Series A
5.40%, 05/15/04 .......................... 210,750
105,000 Connecticut State HFA
Housing Mortgage Finance Program
Series A
5.60%, 05/15/05 .......................... 110,644
125,000 Connecticut State HFA
Housing Mortgage Finance Program
Series A-1
5.85%, 11/15/16 .......................... 129,531
400,000 Connecticut State HFA
Housing Mortgage Finance Program
Series B
6.25%, 11/15/05 .......................... 429,500
100,000 Connecticut State HFA
Housing Mortgage Finance Program
Series B
6.20%, 05/15/12 .......................... 106,375
415,000 Connecticut State HFA
Housing Mortgage Finance Program
Series F-1
5.60%, 05/15/14 .......................... 427,969
1,500,000 Connecticut State HFA
Housing Mortgage Finance Program
Series D-2
5.45%, 11/15/24 .......................... 1,520,625
815,000 Connecticut State Higher Education
Supplemental Loan Authority
Family Education Loan Program
Series A
5.63%, 11/15/07 .......................... 848,619
1,000,000 Connecticut State Resource
Recovery Authority
Series A
5.75%, 11/15/07 .......................... 1,102,500
150,000 Connecticut State, SP OB
Transportation Infrastructure, Series A
5.10%, 09/01/04 .......................... 158,625
950,000 Connecticut State, SP OB
Transportation Infrastructure, Series A
5.13%, 09/01/05 .......................... 1,007,000
700,000 Connecticut State, SP OB
Transportation Infrastructure, Series A
5.40%, 04/01/07 .......................... 746,375
</TABLE>
See Notes to Financial Statements.
25
<PAGE>
Connecticut Municipal Bond Fund
Portfolio of Investments (continued)
April 30, 1999 (unaudited)
<TABLE>
<CAPTION>
Par Value Value
---------- ---------
<S> <C> <C>
Connecticut (continued)
$ 1,250,000 Connecticut State, SP OB
Transportation Infrastructure, Series A
5.25%, 09/01/07 .......................... $ 1,339,063
1,500,000 Connecticut State, SP OB
Transportation Infrastructure, Series A
5.38%, 09/01/08 .......................... 1,625,625
1,750,000 Connecticut State, SP OB
Transportation Infrastructure, Series A
5.50%, 10/01/12 .......................... 1,900,937
1,000,000 Connecticut State, SP OB
Transportation Infrastructure, Series A
5.00%, 11/01/15
Insured: FSA ............................. 1,011,250
400,000 Connecticut State, SP OB
Transportation Infrastructure, Series B
6.13%, 09/01/12 .......................... 456,500
200,000 Danbury, GO
5.63%, 02/01/13 .......................... 222,250
250,000 East Hampton, GO
5.10%, 06/15/05
Insured: MBIA ............................ 264,375
1,100,000 Fairfield, GO
5.00%, 01/01/18 .......................... 1,115,125
500,000 Hamden, GO
5.50%, 08/15/14
Insured: MBIA ............................ 533,750
250,000 Hartford County
Metropolitan District, GO
6.70%, 10/01/09 .......................... 301,875
300,000 Meriden, GO
5.75%, 10/15/04
Insured: AMBAC ........................... 327,750
580,000 Monroe, GO
5.63%, 04/15/14
Insured: FGIC ............................ 622,050
370,000 Montville, GO
5.30%, 12/01/09 .......................... 406,538
500,000 New Canaan, GO
4.75%, 02/01/18 .......................... 494,375
1,500,000 New Haven, GO
5.38%, 02/15/11
Insured: FGIC ............................ 1,584,375
100,000 New Milford, GO
5.80%, 10/01/01 .......................... 105,500
250,000 New Milford, GO
5.50%, 08/01/08 .......................... 275,937
1,000,000 New Milford, GO
5.00%, 05/15/15 .......................... 1,021,250
350,000 Norwalk, GO
5.00%, 01/15/05 .......................... 367,063
<CAPTION>
Par Value Value
---------- ---------
<S> <C> <C>
Connecticut (continued)
$ 200,000 Norwalk, GO
5.00%, 01/15/06 .......................... $ 209,000
500,000 Norwich, GO
5.63%, 09/15/07 .......................... 546,875
330,000 Regional School District No. 5, GO
5.05%, 05/15/04 .......................... 340,771
135,000 Regional School District No. 5, GO
5.15%, 05/15/05 .......................... 139,319
225,000 South Central Regional
Water Authority
Water System, Series 11
5.75%, 08/01/12
Insured: FGIC ............................ 242,438
175,000 South Central Regional
Water Authority
Water System, Series 12
5.13%, 08/01/07
Insured: FGIC ............................ 183,531
100,000 Trumbull, GO
6.00%, 05/15/04 .......................... 110,375
500,000 University of Connecticut, GO
Series A
5.25%, 06/01/15
Insured: MBIA ............................ 519,375
100,000 West Hartford, GO
6.00%, 05/01/07 .......................... 113,000
250,000 West Haven, GO, Series B
5.40%, 06/01/09 .......................... 262,500
-----------
35,409,078
-----------
Other Territories - 12.98%
1,000,000 Puerto Rico Commonwealth, GO
6.00%, 07/01/16
Insured: MBIA ............................ 1,145,000
1,000,000 Puerto Rico Commonwealth, GO
Public Improvement
5.00%, 07/01/05 .......................... 1,050,000
1,000,000 Puerto Rico Commonwealth, GO
Public Improvement
5.50%, 07/01/11 .......................... 1,082,500
1,000,000 Puerto Rico Electric Power
Authority, Series GG
5.13%, 07/01/16
Insured: FSA ............................. 1,027,500
1,000,000 Puerto Rico Municipal
Finance Agency, Series A
5.50%, 07/01/17
Insured: FSA ............................. 1,055,000
-----------
5,360,000
-----------
Total Municipal Securities ............... 40,769,078
(Cost $39,020,620) -----------
</TABLE>
See Notes to Financial Statements.
26
<PAGE>
Connecticut Municipal Bond Fund
Portfolio of Investments (continued)
April 30, 1999 (unaudited)
<TABLE>
<CAPTION>
Shares Value
--------- ---------
<S> <C> <C>
INVESTMENT COMPANY - 0.18%
74,585 Connecticut Federated
Municipal Cash Trust ..................... $ 74,585
------------
Total Investment Company ................. 74,585
(Cost $74,585) ------------
Total Investments - 98.87% ................................. 40,843,663
(Cost $39,095,205) ------------
Net Assets and Other Liabilities - 1.13% ................... 466,445
------------
Net Assets - 100.00% ....................................... $ 41,310,108
============
</TABLE>
- ----------------------------
AMBAC American Municipal Bond Assurance Corp.
FGIC Federal Guaranty Assurance Corp.
FSA Federal Security Assurance Company
GO General Obligation
HEFA Health and Education Facilities Authority
HFA Housing Finance Authority
MBIA Municipal Bond Investors Assurance
SP OB Special Tax Obligation
See Notes to Financial Statements.
27
<PAGE>
Massachusetts Municipal Bond Fund
Portfolio of Investments
April 30, 1999 (unaudited)
<TABLE>
<CAPTION>
Par Value Value
---------- ---------
<S> <C> <C>
MUNICIPAL SECURITIES - 98.21%
California - 1.62%
$ 1,200,000 Los Angeles Regional
Airports Improvement Corp.
American Airlines, Los Angeles
International Airport, Series C
4.25%, 12/01/24 (B)
LOC: Wachovia Bank, N.A. ................. $ 1,200,000
-----------
Louisiana - 0.33%
250,000 Louisiana State Offshore Terminal
Authority, Deepwater Port Revenue
1st Stage A - Loop, Inc.
4.25%, 09/01/08 (B)
LOC: UBS AG .............................. 250,000
-----------
Massachusetts - 89.50%
700,000 Andover, GO
5.00%, 12/01/10 .......................... 731,500
300,000 Attleboro, GO
5.20%, 07/01/02
Insured: AMBAC ........................... 313,500
250,000 Boston, GO
5.25%, 10/01/05
Insured: MBIA ............................ 267,500
360,000 Boston, GO, Series A
5.45%, 02/01/07
Insured: AMBAC ........................... 382,050
225,000 Boston, GO, Series A
5.55%, 02/01/08
Insured: AMBAC ........................... 239,906
200,000 Boston Water and Sewer Commission
General Purpose, Senior Series A
5.50%, 11/01/01
Insured: FSA ............................. 208,750
230,000 Boston Water and Sewer Commission
General Purpose, Senior Series A
7.00%, 11/01/18
Pre-refunded 11/01/01
Insured: FGIC ............................ 252,713
100,000 Brookline, GO
5.60%, 09/01/10 .......................... 106,250
250,000 Deerfield, GO
5.60%, 06/15/02 .......................... 264,062
250,000 Franklin, GO
5.50%, 11/15/02
Insured: MBIA ............................ 265,000
100,000 Kingston, GO
5.70%, 08/01/07 .......................... 106,750
250,000 Lowell, GO
6.05%, 04/01/11
Insured: FSA ............................. 275,938
100,000 Lynn Water and Sewer Commission
5.30%, 12/01/06
Insured: FGIC ............................ 106,375
<CAPTION>
Par Value Value
---------- ---------
<S> <C> <C>
Massachusetts (continued)
$ 130,000 Massachusetts Bay Transportation
Authority, Series A
6.00%, 03/01/12 .......................... $ 140,237
200,000 Massachusetts Bay Transportation
Authority, Series A
5.75%, 03/01/22 .......................... 210,750
1,000,000 Massachusetts Bay Transportation
Authority, Series D
5.00%, 03/01/11 .......................... 1,051,250
750,000 Massachusetts Educational
Financing Authority
Issue G, Series A
5.15%, 12/01/15
Insured: MBIA ............................ 745,313
370,000 Massachusetts State, GO
Federal Assisted Housing
6.00%, 02/01/08 .......................... 406,537
250,000 Massachusetts State, GO, Series A
6.25%, 07/01/02 .......................... 269,063
250,000 Massachusetts State, GO, Series A
6.25%, 07/01/04 .......................... 276,562
1,000,000 Massachusetts State, GO, Series A
5.50%, 11/01/06 .......................... 1,046,250
750,000 Massachusetts State, GO, Series A
5.25%, 02/01/08 .......................... 783,750
200,000 Massachusetts State, GO, Series B
5.30%, 11/01/05 .......................... 214,000
100,000 Massachusetts State, GO, Series B
5.50%, 11/01/07 .......................... 108,875
4,000,000 Massachusetts State Capital
Appreciation, Series A
Federal Highway Note
5.15%, 06/15/15 (A) ...................... 1,820,000
250,000 Massachusetts State
Consolidated Loan, GO, Series A
5.75%, 02/01/15
Insured: MBIA ............................ 272,500
250,000 Massachusetts State
Consolidated Loan, GO, Series B
5.10%, 07/01/03 .......................... 262,813
1,000,000 Massachusetts State
Consolidated Loan, GO, Series C
5.02%, 08/01/18 (A) ...................... 376,250
100,000 Massachusetts State
Convention Center Authority
Boston Common Parking Garage
Series A
5.35%, 09/01/06 .......................... 107,000
100,000 Massachusetts State
Convention Center Authority
Boston Common Parking Garage
Series A
5.40%, 09/01/07 .......................... 106,750
800,000 Massachusetts State
Development Finance Agency
Regis College
5.00%, 10/01/08 .......................... 808,000
</TABLE>
See Notes to Financial Statements.
28
<PAGE>
Massachusetts Municipal Bond Fund
Portfolio of Investments (continued)
April 30, 1999 (unaudited)
<TABLE>
<CAPTION>
Par Value Value
---------- ---------
<S> <C> <C>
Massachusetts (continued)
$ 1,000,000 Massachusetts State Grant
Anticipation Notes, Series A
5.25%, 12/15/12 .......................... $ 1,065,000
1,000,000 Massachusetts State Grant
Anticipation Notes, Series A
5.50%, 06/15/14 .......................... 1,065,000
1,000,000 Massachusetts State HEFA
Amherst College, Series G
5.00%, 11/01/18 .......................... 985,000
2,000,000 Massachusetts State HEFA
Amherst College, Series G
5.38%, 11/01/20 .......................... 2,037,500
400,000 Massachusetts State HEFA
Beth Israel Hospital, Series G
5.70%, 07/01/05
Insured: AMBAC ........................... 426,000
2,000,000 Massachusetts State HEFA
Boston College, Series L
5.00%, 06/01/26 .......................... 1,945,000
1,000,000 Massachusetts State HEFA
Caregroup, Series A
5.50%, 07/01/08 .......................... 1,085,000
1,640,000 Massachusetts State HEFA
Catholic Health East, Series A
5.25%, 11/15/13 .......................... 1,707,650
1,000,000 Massachusetts State HEFA
Harvard University, Series P
5.63%, 11/01/26 .......................... 1,053,750
1,000,000 Massachusetts State HEFA
Harvard University, Series P
5.38%, 11/01/32 .......................... 1,021,250
100,000 Massachusetts State HEFA
McLean Hospital Issue, Series C
6.63%, 07/01/15
Insured: FGIC ............................ 110,500
250,000 Massachusetts State HEFA
Medical Center of Central
Massachusetts, Series B
6.00%, 07/01/02
Insured: AMBAC ........................... 266,562
1,435,000 Massachusetts State HEFA
Partners Healthcare System
Series A
5.38%, 07/01/17
Insured: MBIA ............................ 1,474,463
100,000 Massachusetts State HEFA
South Shore Hospital, Series E
5.40%, 07/01/07
Insured: MBIA ............................ 104,875
325,000 Massachusetts State HEFA
South Shore Hospital, Series E
5.50%, 07/01/13
Insured: MBIA ............................ 342,469
500,000 Massachusetts State HEFA
Williams College, Series D
5.40%, 07/01/05 .......................... 531,875
<CAPTION>
Par Value Value
---------- ---------
<S> <C> <C>
Massachusetts (continued)
$ 1,750,000 Massachusetts State HEFA
Williams College, Series F
5.50%, 07/01/26 .......................... $ 1,791,563
150,000 Massachusetts State Housing
Finance Agency
Single Family, Series 41
5.25%, 06/01/01 .......................... 153,562
1,250,000 Massachusetts State IFA
Belmont Hill School
5.63%, 09/01/20 .......................... 1,282,813
400,000 Massachusetts State IFA
Brooks School
5.95%, 07/01/23 .......................... 439,500
1,000,000 Massachusetts State IFA
Combined Jewish Philanthropies
Series A
6.38%, 02/01/15
Insured: AMBAC ........................... 1,103,750
1,000,000 Massachusetts State IFA
Concord Academy
5.50%, 09/01/27 .......................... 1,005,000
1,000,000 Massachusetts State IFA
Groton School, Series A
5.00%, 03/01/28 .......................... 975,000
250,000 Massachusetts State IFA
Lesley College Project, Series A
6.00%, 07/01/10
Insured: Connie Lee ...................... 275,938
300,000 Massachusetts State IFA
Milton Academy, Series B
5.30%, 09/01/08
Insured: MBIA ............................ 316,125
950,000 Massachusetts State IFA
Nantucket Electric Company
Series A, AMT
5.88%, 07/01/17
Insured: AMBAC ........................... 1,016,500
500,000 Massachusetts State IFA
Park School
5.90%, 09/01/26 .......................... 521,250
2,000,000 Massachusetts State IFA
Phillips Academy Issue
5.38%, 09/01/23 .......................... 2,042,500
1,210,000 Massachusetts State IFA
Trustees Deerfield Academy
5.00%, 10/01/23 .......................... 1,199,412
1,830,000 Massachusetts State IFA
Tufts University, Series H
5.50%, 02/15/13
Insured: MBIA ............................ 1,983,262
1,200,000 Massachusetts State IFA
Wentworth Institute of Technology
5.65%, 10/01/18 .......................... 1,218,000
1,300,000 Massachusetts State IFA
Worcester Polytechnic Institute
Series 2
5.25%, 09/01/14
Insured: MBIA ............................ 1,348,750
</TABLE>
See Notes to Financial Statements.
29
<PAGE>
Massachusetts Municipal Bond Fund
Portfolio of Investments (continued)
April 30, 1999 (unaudited)
<TABLE>
<CAPTION>
Par Value Value
---------- ---------
<S> <C> <C>
Massachusetts (continued)
$ 635,000 Massachusetts State Port Authority
5.63%, 07/01/12 .......................... $ 686,594
1,000,000 Massachusetts State Port Authority
Series A
5.75%, 07/01/12 .......................... 1,112,500
250,000 Massachusetts State Port Authority
Series B
5.30%, 07/01/01 .......................... 259,063
1,000,000 Massachusetts State Port Authority
Series C
5.13%, 07/01/16 .......................... 1,017,500
350,000 Massachusetts State, SP OB
and Revenue, Series A
5.80%, 06/01/00
Insured: AMBAC ........................... 359,394
300,000 Massachusetts State, SP OB
and Revenue, Series A
7.00%, 06/01/02 .......................... 328,500
1,000,000 Massachusetts State, SP OB
and Revenue, Series A
5.50%, 06/01/13 .......................... 1,080,000
200,000 Massachusetts State, SP OB
and Revenue, Series A
6.00%, 06/01/13
Insured: AMBAC ........................... 213,250
250,000 Massachusetts State, SP OB
and Revenue, Series A
5.80%, 06/01/14
Pre-refunded 06/01/04 .................... 273,437
250,000 Massachusetts State
Turnpike Authority, Series A
5.00%, 01/01/13 .......................... 259,375
2,500,000 Massachusetts State
Turnpike Authority, Series A
Metropolitan Highway Systems
4.50%, 01/01/04
Insured: AMBAC ........................... 2,556,250
1,500,000 Massachusetts State
Turnpike Authority, Series A
Metropolitan Highway Systems
5.00%, 01/01/39
Insured: AMBAC ........................... 1,428,750
250,000 Massachusetts State
Water Pollution Abatement Trust
WRA Loan Program, Series A
5.40%, 08/01/11 .......................... 263,437
250,000 Massachusetts State
Water Pollution Abatement Trust
Pooled Loan Program, Series 1
5.00%, 02/01/02 .......................... 259,062
300,000 Massachusetts State WRA
Series A
6.30%, 12/01/01 .......................... 319,875
100,000 Massachusetts State WRA
Series A
6.00%, 04/01/20 .......................... 102,476
<CAPTION>
Par Value Value
---------- ---------
<S> <C> <C>
Massachusetts (continued)
$ 190,000 Massachusetts State WRA
Series A
6.50%, 07/15/21
Pre-refunded 07/15/02 .................... $ 209,475
300,000 Massachusetts State WRA
Series B
5.88%, 11/01/04 .......................... 324,375
1,165,000 Massachusetts State WRA
Series B
5.50%, 08/01/15
Insured: FSA ............................. 1,250,919
1,000,000 Massachusetts State WRA
Series C
5.25%, 12/01/06
Insured: FGIC ............................ 1,070,000
1,000,000 Methuen, GO
5.63%, 11/15/14
Insured: FSA ............................. 1,090,000
220,000 Nantucket Island Land Bank
GO and Revenue, Series E
7.25%, 07/01/19 .......................... 240,350
450,000 New England Education
Loan Marketing Corp.
Massachusetts Student
Loan Revenue, Issue A
5.80%, 03/01/02 .......................... 471,938
200,000 Northampton, GO
5.30%, 09/01/10
Insured: AMBAC ........................... 210,000
1,500,000 Plymouth County
Certificates of Participation
Correctional Facility Project
5.00%, 04/01/22
Insured: AMBAC ........................... 1,460,625
150,000 Salem, GO
5.80%, 07/15/06
Insured: AMBAC ........................... 160,312
100,000 Salem, GO
5.90%, 07/15/07
Insured: AMBAC ........................... 107,000
200,000 Sandwich, GO
5.40%, 11/01/07
Insured: AMBAC ........................... 213,000
1,000,000 Southeastern Massachusetts
University Building Authority
Project , Series A
5.75%, 05/01/16
Insured: AMBAC ........................... 1,067,500
1,500,000 Springfield Municipal
Purpose Loan, GO
5.00%, 09/01/15 .......................... 1,522,500
400,000 Taunton, GO
8.00%, 02/01/01 .......................... 428,500
250,000 University of Lowell
Building Authority
Fifth Series A
6.75%, 11/01/03
Insured: AMBAC ........................... 280,000
</TABLE>
See Notes to Financial Statements.
30
<PAGE>
Massachusetts Municipal Bond Fund
Portfolio of Investments (continued)
April 30, 1999 (unaudited)
<TABLE>
<CAPTION>
Par Value Value
---------- ---------
<S> <C> <C>
Massachusetts (continued)
$ 200,000 University of Massachusetts
Building Authority, Series A
5.50%, 05/01/03
Insured: MBIA ............................ $ 212,250
100,000 Woods Hole, Martha's
Vineyard and Nantucket
Steamship Bonds, Series B
6.00%, 03/01/02 .......................... 106,250
1,000,000 Worcester, Series A
5.00%, 07/01/14
Insured: FSA ............................. 1,020,000
-----------
66,385,470
-----------
Other Territories - 5.90%
500,000 Puerto Rico Commonwealth
Aqueduct and Sewer Authority
6.00%, 07/01/09
Insured: Guaranteed by
Commonwealth of Puerto Rico .............. 561,250
500,000 Puerto Rico Commonwealth
Infrastructure Financing Authority
Special Tax Revenue, Series A
5.13%, 07/01/09 .......................... 535,625
1,000,000 Puerto Rico Commonwealth
Public Improvement, GO
5.50%, 07/01/13 .......................... 1,083,750
1,000,000 Puerto Rico Electric Power
Authority, Series BB
6.00%, 07/01/12
Insured: MBIA ............................ 1,140,000
1,000,000 Puerto Rico Municipal
Finance Agency, Series A
5.50%, 07/01/17
Insured: FSA ............................. 1,055,000
-----------
4,375,625
-----------
Texas - 0.86%
1,000,000 Lubbock Independent School
District, GO, Capital Appreciation
6.01%, 02/15/09 (A) ...................... 638,750
-----------
Total Municipal Securities ............... 72,849,845
(Cost $70,727,551) -----------
<CAPTION>
Shares Value
---------- ---------
<S> <C>
INVESTMENT COMPANY - 0.26%
188,297 Massachusetts Federated
Municipal Cash Trust ..................... $ 188,297
-----------
Total Investment Company ................. 188,297
(Cost $188,297) -----------
Total Investments - 98.47% ................................. 73,038,142
(Cost $70,915,848) -----------
Net Assets and Other Liabilities - 1.53% ................... 1,137,462
-----------
Net Assets - 100.00% ....................................... $74,175,604
===========
</TABLE>
- ----------------------------------
(A) Zero Coupon Bond. Rate shown reflects effective yield to maturity at
time of purchase.
(B) Variable rate bond. Rate shown reflects rate in effect at April 30,
1999.
AMBAC American Municipal Bond Assurance Corp.
AMT Alternative Minimum Tax. Private activity obligations the interest
on which is subject to the federal AMT for individuals.
Connie Lee College Construction Loan Association
FGIC Federal Guaranty Insurance Corp.
FSA Financial Security Assurance Company
GO General Obligation
HEFA Health and Educational Facilities Authority
IFA Industrial Finance Agency
LOC Letter of Credit
MBIA Municipal Bond Insurance Association
SP OB Special Obligation
WRA Water Resource Authority
See Notes to Financial Statements.
31
<PAGE>
Rhode Island Municipal Bond Fund
Portfolio of Investments
April 30, 1999 (unaudited)
<TABLE>
<CAPTION>
Par Value Value
---------- ---------
<S> <C> <C>
MUNICIPAL SECURITIES - 98.47%
California - 1.72%
$ 400,000 Los Angeles Regional
Airports Improvement Corp.
American Airlines, Inc., Los Angeles
International Airport, Series C
4.25%, 12/01/24 (B)
LOC: Wachovia Bank, N.A. ................. $ 400,000
-----------
Louisiana - 2.15%
500,000 Louisiana State Offshore Terminal
Authority, Deepwater Port Revenue
1st Stage A - Loop, Inc.
4.25%, 09/01/08 (B)
LOC: UBS AG .............................. 500,000
-----------
Rhode Island - 75.14%
500,000 Bristol County Water Authority
Revenue, General, Series A
5.00%, 07/01/16
Insured: MBIA ............................ 498,125
200,000 Burrillville, GO
5.85%, 05/01/14
Insured: FGIC ............................ 218,500
500,000 Convention Center Authority, Series A
6.38%, 05/15/23
Insured: MBIA ............................ 536,250
700,000 Lincoln, GO
5.50%, 08/15/10
Insured: MBIA ............................ 735,000
350,000 North Kingstown, GO, Series A
5.38%, 12/15/02
Insured: FGIC ............................ 369,688
300,000 Pawtucket, GO
5.63%, 04/15/07 .......................... 319,875
400,000 Pawtucket, GO
5.75%, 04/15/11
Insured: FGIC ............................ 425,000
500,000 Providence, GO
5.70%, 01/15/06
Insured: MBIA ............................ 528,750
500,000 Providence, GO
5.45%, 01/15/10
Insured: FSA ............................. 533,125
500,000 Rhode Island Clean Water
Protection Finance Agency
PCR, Series A
5.25%, 10/01/16
Insured: AMBAC ........................... 510,625
150,000 Rhode Island Clean Water
Protection Finance Agency
Safe Drinking Water
Providence, Series A
6.20%, 01/01/06
Insured: AMBAC ........................... 166,125
<CAPTION>
Par Value Value
---------- ---------
<S> <C> <C>
Rhode Island (continued)
$ 100,000 Rhode Island Clean Water
Protection Finance Agency
Safe Drinking Water
Providence, Series A
6.70%, 01/01/15
Insured: AMBAC ........................... $ 113,000
250,000 Rhode Island Clean Water
Protection Finance Agency
Wastewater Treatment
System, Cranston
5.80%, 09/01/22
Insured: MBIA ............................ 266,875
500,000 Rhode Island Depositors
Economic Protection Corp.
SP OB, Series A
5.75%, 08/01/21 .......................... 549,375
250,000 Rhode Island Depositors
Economic Protection Corp.
SP OB, Series B
5.25%, 08/01/21
Insured: MBIA ............................ 263,750
300,000 Rhode Island State HMFC
Homeownership Opportunity
Series 17-A
6.25%, 04/01/17 .......................... 314,625
500,000 Rhode Island State HMFC
Homeownership Opportunity
Series 19-A
5.70%, 04/01/15 ...... ................... 515,000
500,000 Rhode Island State HMFC
Homeownership Opportunity
Series 29-A
5.05%, 10/01/15
Insured: FHA ............................. 497,500
500,000 Rhode Island State HMFC
Homeownership Opportunity
Series 22-A
5.55%, 04/01/17 .......................... 511,875
500,000 Rhode Island State HMFC
Multifamily Housing
Series A
5.60%, 07/01/10
Insured: AMBAC ........................... 533,125
500,000 Rhode Island State HMFC
Multifamily Housing
Series A
6.15%, 07/01/17
Insured: AMBAC ........................... 532,500
250,000 Rhode Island State HMFC
Rental Housing Program
Series A
5.65%, 10/01/07 .......................... 260,312
150,000 Rhode Island State, GO, Series A
6.25%, 06/15/07
Pre-refunded 06/15/02
Insured: FGIC ............................ 163,687
</TABLE>
See Notes to Financial Statements.
32
<PAGE>
Rhode Island Municipal Bond Fund
Portfolio of Investments (continued)
April 30, 1999 (unaudited)
<TABLE>
<CAPTION>
Par Value Value
---------- ---------
<S> <C> <C>
Rhode Island (continued)
$ 200,000 Rhode Island State, GO, Series A
6.10%, 06/15/03
Insured: FGIC ............................ $ 216,750
150,000 Rhode Island State, GO, Series A
6.25%, 06/15/07
Unrefunded
Insured: FGIC ............................ 162,187
250,000 Rhode Island State
Consolidated Capital Development
Loan GO, Series A
5.13%, 07/15/12
Insured: FGIC ............................ 259,688
250,000 Rhode Island State EDC
Airport Series B
5.25%, 07/01/11
Insured: FSA ............................. 262,812
500,000 Rhode Island State EDC
Airport Series B
5.00%, 07/01/18
Insured: FSA ............................. 491,250
250,000 Rhode Island State EDC
Airport Series B
5.00%, 07/01/23
Insured: FSA ............................. 243,125
175,000 Rhode Island State HEBC
Higher Education Facility
Unrefunded
6.50%, 11/15/24
Insured: Connie Lee ...................... 192,062
500,000 Rhode Island State HEBC
Higher Education Facility
Brown University
6.00%, 09/01/20 .......................... 554,375
1,000,000 Rhode Island State HEBC
Higher Education Facility
Brown University
5.00%, 09/01/23 .......................... 976,250
275,000 Rhode Island State HEBC
Higher Education Facility
Bryant College, SP OB
6.50%, 06/01/05
Insured: MBIA ............................ 298,719
475,000 Rhode Island State HEBC
Higher Education Facility
New England Institute
6.00%, 03/01/15
Insured: Connie Lee ...................... 511,219
300,000 Rhode Island State HEBC
Higher Education Facility
Providence College
5.60%, 11/01/09
Insured: MBIA ............................ 318,375
<CAPTION>
Par Value Value
---------- ---------
<S> <C> <C>
Rhode Island (continued)
$ 500,000 Rhode Island State HEBC
Higher Education Facility
Rhode Island School of Design
5.63%, 06/01/16
Insured: MBIA ............................ $ 533,750
325,000 Rhode Island State HEBC
Higher Education Facility
Roger Williams
6.50%, 11/15/24
Insured: Connie Lee ...................... 360,344
260,000 Rhode Island State HEBC
Higher Education Facility
Salve Regina
6.25%, 03/15/13
Insured: Connie Lee ...................... 282,100
500,000 Rhode Island State HEBC
Miriam Hospital
Series B
6.60%, 04/01/19 .......................... 558,125
500,000 Rhode Island State HEBC
Newport Hospital
5.25%, 07/01/19 .......................... 486,875
300,000 Rhode Island State HEBC
Saint Antoine
6.75%, 11/15/18
LOC: Allied Irish Banks NY ............... 313,500
500,000 Rhode Island State
Industrial Facilities Corp., Revenue
Marine Terminal, Mobil Oil Refining
6.00%, 11/01/14 .......................... 543,125
100,000 South Kingstown, GO, Series B
5.50%, 06/15/10
Insured: FSA ............................. 107,125
140,000 Westerly, GO
6.00%, 09/15/14
Insured: AMBAC ........................... 152,600
300,000 Woonsocket, GO
4.75%, 12/15/16 .......................... 295,125
-----------
17,482,168
-----------
Other Territories - 14.68%
250,000 Puerto Rico Commonwealth, GO
6.00%, 07/01/16
Insured: MBIA ............................ 286,250
250,000 Puerto Rico Commonwealth, GO
Public Improvement
5.00%, 07/01/05 .......................... 262,500
500,000 Puerto Rico Commonwealth, GO
Public Improvement
5.50%, 07/01/12 .......................... 542,500
500,000 Puerto Rico Commonwealth
Special Tax Revenue, Series A
Infrastructure Finance Authority
5.00%, 07/01/16
Insured: AMBAC ........................... 507,500
</TABLE>
See Notes to Financial Statements.
33
<PAGE>
Rhode Island Municipal Bond Fund
Portfolio of Investments (continued)
April 30, 1999 (unaudited)
<TABLE>
<CAPTION>
Par Value Value
---------- ---------
<S> <C> <C>
Other Territories (continued)
$ 500,000 Puerto Rico Electric Power Authority
Revenue, Series EE
5.25%, 07/01/15
Insured: MBIA ............................ $ 524,375
400,000 Puerto Rico Municipal
Finance Agency, Series A
6.00%, 07/01/14
Insured: FSA ............................. 439,500
315,000 Puerto Rico Municipal
Finance Agency, Series A
5.50%, 07/01/17
Insured: FSA ............................. 332,325
500,000 Puerto Rico Public Buildings Authority
Government Facilities, Series A
5.50%, 07/01/21
Insured: AMBAC ........................... 520,000
-----------
3,414,950
-----------
Texas - 2.53%
300,000 Grapevine Industrial Development Corp.
American Airlines, Series B4
3.85%, 12/01/24 (B)
LOC: Morgan Guaranty Trust ............... 300,000
450,000 Lubbock Independent
School District, GO
Capital Appreciation
6.10%, 02/15/09 (A) ...................... 287,438
-----------
587,438
-----------
Washington - 2.25%
1,000,000 Seattle, GO, Series E
4.85%, 12/15/12 (A) ...................... 523,750
-----------
Total Municipal Securities ............... 22,908,306
(Cost $22,024,463) -----------
<CAPTION>
Shares Value
--------- ---------
<S> <C> <C>
INVESTMENT COMPANY - 0.44%
103,011 Federated Tax-Free Obligations Fund........ $ 103,011
-----------
Total Investment Company .................. 103,011
(Cost $103,011) -----------
Total Investments - 98.91% ................................. 23,011,317
(Cost $22,127,474) -----------
Net Other Assets and Liabilities - 1.09% ................... 253,683
-----------
Net Assets - 100.00% ....................................... $23,265,000
===========
</TABLE>
- --------------------------------------
(A) Zero Coupon Bond. Rate shown reflects effective yield to maturity at
time of purchase.
(B) Interest is reset once a year. The interest rate shown reflects the
rate in effect at April 30, 1999.
AMBAC American Municipal Bond Assurance Corp.
Connie Lee College Construction Loan Association
EDC Economic Development Corp.
FGIC Federal Guaranty Insurance Corp.
FHA Federal Housing Authority
FSA Financial Security Assurance Company
GO General Obligation
HEBC Health and Educational Building Corp.
HMFC Housing and Mortgage Finance Corp.
LOC Letter of Credit
MBIA Municipal Bond Investors Assurance
PCR Pollution Control Revenue
SP OB Special Obligation
See Notes to Financial Statements.
34
<PAGE>
This page left blank intentionally.
<PAGE>
Galaxy Tax-Free Bond Funds
Statements of Assets and Liabilities
April 30, 1999 (unaudited)
<TABLE>
<CAPTION>
New Jersey New York
Tax-Exempt Municipal Municipal
Bond Fund Bond Fund Bond Fund
----------------- ----------------- ------------------
<S> <C> <C> <C>
ASSETS:
Investments (Note 2):
Investments at cost ............................... $ 165,264,351 $ 9,161,264 $ 81,099,501
Net unrealized appreciation ....................... 6,581,761 113,953 3,636,646
----------------- ----------------- ------------------
Total investments at value ........................ 171,846,112 9,275,217 84,736,147
Cash ................................................ -- 812 45,555
Receivable for investments sold ..................... 1,061,385 -- --
Receivable for shares sold .......................... 306,509 1,131 43,872
Receivable from Investment Advisor .................. -- 3,676 --
Interest and dividend receivables ................... 2,430,338 111,668 1,247,439
Deferred organizational expense (Note 2) ............ -- 13,341 --
----------------- ----------------- ------------------
Total Assets ...................................... 175,644,344 9,405,845 86,073,013
----------------- ----------------- ------------------
LIABILITIES:
Dividends payable ................................... 601,126 25,804 265,327
Payable for investments purchased ................... 2,157,955 -- --
Payable to Custodian ................................ 7,905 -- --
Payable for shares repurchased ...................... 109,578 443 6,630
Advisory fee payable (Note 3) ....................... 78,252 2,225 39,149
Payable to Fleet affiliates (Note 3) ................ 9,749 582 4,543
Payable to Administrator (Note 3) ................... 21,485 378 16,516
Trustees' fees and expenses payable (Note 3) ........ 5,504 144 2,474
Accrued expenses and other payables ................. 24,670 24,368 14,588
----------------- ----------------- ------------------
Total Liabilities ................................. 3,016,224 53,944 349,227
----------------- ----------------- ------------------
NET ASSETS ............................................. $ 172,628,120 $ 9,351,901 $ 85,723,786
================= ================= ==================
NET ASSETS consist of:
Par value (Note 5) .................................. $ 15,586 $ 921 $ 7,561
Paid-in capital in excess of par value .............. 165,812,332 9,238,949 82,531,962
Undistributed (overdistributed) net investment
income (loss) ....................................... (18,625) 1,972 (840)
Accumulated net realized gain (loss) on
investments sold .................................... 237,066 (3,894) (451,543)
Net unrealized appreciation of investments .......... 6,581,761 113,953 3,636,646
----------------- ----------------- ------------------
TOTAL NET ASSETS ....................................... $ 172,628,120 $ 9,351,901 $ 85,723,786
================= ================= ==================
Retail A Shares:
Net Assets .......................................... $ 24,764,584 $ 1,508,530 $ 46,892,415
Shares of beneficial interest outstanding ........... 2,235,888 148,581 4,135,743
NET ASSET VALUE and redemption price per share ...... $ 11.08 $ 10.15 $ 11.34
Sales charge - 3.75% of offering price .............. 0.43 0.40 0.44
----------------- ----------------- ------------------
Maximum offering price per share .................... $ 11.51 $ 10.55 $ 11.78
================= ================= ==================
Retail B Shares:
Net Assets .......................................... $ 3,502,104 N/A N/A
Shares of beneficial interest outstanding ........... 316,188 N/A N/A
----------------- ----------------- ------------------
NET ASSET VALUE and offering price per share* ....... $ 11.08 N/A N/A
================= ================= ==================
Trust Shares:
Net Assets .......................................... $ 144,361,432 $ 7,843,371 $ 38,831,371
Shares of beneficial interest outstanding ........... 13,034,060 772,483 3,424,766
----------------- ----------------- ------------------
NET ASSET VALUE, offering and
redemption price per share ........................ $ 11.08 $ 10.15 $ 11.34
================= ================= ==================
</TABLE>
- --------------------------------------------------------
*Redemption price per share is equal to the Net Asset Value per share less any
applicable contingent deferred sales charge.
See Notes to Financial Statements.
36
<PAGE>
<TABLE>
<CAPTION>
Connecticut Massachusetts Rhode Island
Municipal Municipal Municipal
Bond Fund Bond Fund Bond Fund
----------------- ----------------- -----------------
<S> <C> <C> <C>
ASSETS:
Investments (Note 2):
Investments at cost ............................... $ 39,095,205 $ 70,915,848 $ 22,127,474
Net unrealized appreciation ....................... 1,748,458 2,122,294 883,843
----------------- ----------------- -----------------
Total investments at value ........................ 40,843,663 73,038,142 23,011,317
Cash ................................................ -- 18,589 536
Receivable for investments sold ..................... -- -- --
Receivable for shares sold .......................... 84,204 354,888 1,001
Receivable from Investment Advisor .................. -- -- --
Interest and dividend receivables ................... 574,535 1,085,325 317,962
Deferred organizational expense (Note 2) ............ -- -- 1,743
----------------- ----------------- -----------------
Total Assets ...................................... 41,502,402 74,496,944 23,332,559
----------------- ----------------- -----------------
LIABILITIES:
Dividends payable ................................... 141,821 257,153 40,992
Payable for investments purchased ................... -- -- --
Payable to Custodian ................................ 123 -- --
Payable for shares repurchased ...................... 6,620 11,883 10,128
Advisory fee payable (Note 3) ....................... 12,117 21,257 7,127
Payable to Fleet affiliates (Note 3) ................ 3,227 5,587 --
Payable to Administrator (Note 3) ................... 17,987 22,480 3,420
Trustees' fees and expenses payable (Note 3) ........ 1,795 2,875 3,018
Accrued expenses and other payables ................. 8,604 105 2,874
----------------- ----------------- -----------------
Total Liabilities ................................. 192,294 321,340 67,559
----------------- ----------------- -----------------
NET ASSETS ............................................. $ 41,310,108 $ 74,175,604 $ 23,265,000
================= ================= =================
NET ASSETS consist of:
Par value (Note 5) .................................. $ 3,852 $ 7,078 $ 2,103
Paid-in capital in excess of par value .............. 40,315,466 72,435,799 22,389,659
Undistributed (overdistributed) net investment
income (loss) ....................................... (14,614) (21,727) (13,020)
Accumulated net realized gain (loss) on
investments sold .................................... (743,054) (367,840) 2,415
Net unrealized appreciation of investments .......... 1,748,458 2,122,294 883,843
----------------- ----------------- -----------------
TOTAL NET ASSETS ....................................... $ 41,310,108 $ 74,175,604 $ 23,265,000
================= ================= =================
Retail A Shares:
Net Assets .......................................... $ 25,472,427 $ 45,048,957 $ 23,265,000
Shares of beneficial interest outstanding ........... 2,375,070 4,298,458 2,102,998
NET ASSET VALUE and redemption price per share ...... $ 10.72 $ 10.48 $ 11.06
Sales charge - 3.75% of offering price .............. 0.42 0.41 0.43
----------------- ----------------- -----------------
Maximum offering price per share .................... $ 11.14 $ 10.89 $ 11.49
================= ================= =================
Retail B Shares:
Net Assets .......................................... N/A N/A N/A
Shares of beneficial interest outstanding ........... N/A N/A N/A
----------------- ----------------- -----------------
NET ASSET VALUE and offering price per share* ....... N/A N/A N/A
================= ================= =================
Trust Shares:
Net Assets .......................................... $ 15,837,681 $ 29,126,647 $ --
Shares of beneficial interest outstanding ........... 1,476,708 2,779,273 --
----------------- ----------------- -----------------
NET ASSET VALUE, offering and
redemption price per share ........................ $ 10.72 $ 10.48 $ --
================= ================= =================
</TABLE>
37
<PAGE>
Galaxy Tax-Free Bond Funds
Statements of Operations
For the six months ended April 30, 1999 (unaudited)
<TABLE>
<CAPTION>
New Jersey New York
Tax-Exempt Municipal Municipal
Bond Fund Bond Fund Bond Fund
----------------- ----------------- ------------------
<S> <C> <C> <C>
INVESTMENT INCOME:
Interest (Note 2) ................................... $ 4,233,601 $ 198,803 $ 2,090,000
Dividends (Note 2) .................................. 29,422 3,405 13,578
----------------- ----------------- ------------------
Total investment income ........................... 4,263,023 202,208 2,103,578
----------------- ----------------- ------------------
EXPENSES:
Investment advisory fee (Note 3) .................... 626,315 32,824 316,557
Administration fee (Note 3) ......................... 63,534 3,372 32,116
Custodian fee ....................................... 6,471 11,452 4,534
Fund accounting fee (Note 3) ........................ 29,876 19,356 25,809
Legal fee (Note 3) .................................. 3,729 185 1,848
Audit fee ........................................... 8,145 12,670 8,145
Transfer agent fee (Note 3) ......................... 12,356 2,480 12,887
Shareholder servicing and 12b-1 fees (Note 3) ....... 28,972 786 34,418
Trustees' fees and expenses (Note 3) ................ 2,270 112 1,520
Amortization of organization costs (Note 2) ......... -- 1,685 --
Reports to shareholders ............................. 7,419 1,551 9,202
Miscellaneous ....................................... 16,441 3,493 10,138
----------------- ----------------- ------------------
Total expenses before reimbursement/waiver ........ 805,528 89,966 457,174
----------------- ----------------- ------------------
Less: reimbursement/waiver (Note 4) ............... (167,017) (48,705) (85,748)
----------------- ----------------- ------------------
Total expenses net of reimbursement/waiver ........ 638,511 41,261 371,426
----------------- ----------------- ------------------
NET INVESTMENT INCOME .................................. 3,624,512 160,947 1,732,152
----------------- ----------------- ------------------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
(Notes 2 & 6):
Net realized gain (loss) on investments sold ........ 244,455 (3,207) 61,806
Net change in unrealized depreciation
of investments .................................... (1,596,250) (69,139) (786,504)
----------------- ----------------- ------------------
NET REALIZED AND UNREALIZED
LOSS ON INVESTMENTS ................................. (1,351,795) (72,346) (724,698)
----------------- ----------------- ------------------
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS ........................... $ 2,272,717 $ 88,601 $ 1,007,454
================= ================= ==================
</TABLE>
See Notes to Financial Statements.
38
<PAGE>
<TABLE>
<CAPTION>
Connecticut Massachusetts Rhode Island
Municipal Municipal Municipal
Bond Fund Bond Fund Bond Fund
----------------- ----------------- -----------------
<S> <C> <C> <C>
INVESTMENT INCOME:
Interest (Note 2) ................................... $ 979,996 $ 1,719,438 $ 545,630
Dividends (Note 2) .................................. 6,491 14,395 6,215
----------------- ----------------- -----------------
Total investment income ........................... 986,487 1,733,833 551,845
----------------- ----------------- -----------------
EXPENSES:
Investment advisory fee (Note 3) .................... 151,948 264,539 80,803
Administration fee (Note 3) ......................... 15,414 26,836 8,198
Custodian fee ....................................... 3,812 4,603 4,396
Fund accounting fee (Note 3) ........................ 21,668 29,127 15,459
Legal fee (Note 3) .................................. 871 1,531 434
Audit fee ........................................... 8,701 8,701 7,673
Transfer agent fee (Note 3) ......................... 8,055 10,269 2,480
Shareholder servicing and 12b-1 fees (Note 3) ....... 18,611 32,583 --
Trustees' fees and expenses (Note 3) ................ 530 932 264
Amortization of organization costs (Note 2) ......... -- -- 1,696
Reports to shareholders ............................. 6,002 7,142 1,625
Miscellaneous ....................................... 6,321 9,219 4,828
----------------- ----------------- -----------------
Total expenses before reimbursement/waiver ........ 241,933 395,482 127,856
----------------- ----------------- -----------------
Less: reimbursement/waiver (Note 4) ............... (81,039) (141,088) (43,095)
----------------- ----------------- -----------------
Total expenses net of reimbursement/waiver ........ 160,894 254,394 84,761
----------------- ----------------- -----------------
NET INVESTMENT INCOME .................................. 825,593 1,479,439 467,084
----------------- ----------------- -----------------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
(Notes 2 & 6):
Net realized gain (loss) on investments sold ........ 55,895 4,015 3,369
Net change in unrealized depreciation
of investments .................................... (413,709) (363,365) (136,683)
----------------- ----------------- -----------------
NET REALIZED AND UNREALIZED
LOSS ON INVESTMENTS ................................. (357,814) (359,350) (133,314)
----------------- ----------------- -----------------
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS ........................... $ 467,779 $ 1,120,089 $ 333,770
================= ================= =================
</TABLE>
39
<PAGE>
Galaxy Tax-Free Bond Funds
Statements of Changes in Net Assets
<TABLE>
<CAPTION>
New Jersey New York
Tax-Exempt Bond Fund Municipal Bond Fund Municipal Bond Fund
--------------------------- ------------------------ ------------------------
Six months Year Six months Period Six months Year
ended April 30, ended ended April 30, ended ended April 30, ended
1999 October 31, 1999 October 31, 1999 October 31,
(unaudited) 1998 (unaudited) 1998* (unaudited) 1998
------------ ------------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
NET ASSETS at beginning of period....... $163,142,500 $ 149,372,871 $ 8,516,218 $ 20(a) $83,019,676 $65,995,842
------------ ------------- ----------- ----------- ----------- -----------
Increase in Net Assets
resulting from operations:
Net investment income................ 3,624,512 7,177,099 160,947 152,168 1,732,152 3,217,725
Net realized gain (loss) on
investments sold and written options 244,455 1,998,815 (3,207) (687) 61,806 822,875
Net change in unrealized appreciation
(depreciation) of investments
and written options............... (1,596,250) 2,771,283 (69,139) 183,092 (786,504) 1,441,749
------------ ------------- ----------- ----------- ----------- -----------
Net increase in net assets
resulting from operations......... 2,272,717 11,947,197 88,601 334,573 1,007,454 5,482,349
------------ ------------- ----------- ----------- ----------- -----------
Dividends to shareholders from:
Retail A Shares:
Net investment income............. (524,942) (1,112,636) (18,046) (8,997) (962,241) (1,819,081)
Net realized gain on investments.. (307,311) (209,493) -- -- -- --
------------ ------------- ----------- ----------- ----------- -----------
Total Dividends................ (832,253) (1,322,129) (18,046) (8,997) (962,241) (1,819,081)
------------ ------------- ----------- ----------- ----------- -----------
Retail B Shares:
Net investment income............. (52,711) (87,830) N/A N/A N/A N/A
Net realized gain on investments.. (32,906) (14,276) N/A N/A N/A N/A
------------ ------------- ----------- ----------- ----------- -----------
Total Dividends................ (85,617) (102,106) N/A N/A N/A N/A
------------ ------------- ----------- ----------- ----------- -----------
Trust Shares:
Net investment income............. (3,046,859) (6,048,821) (142,901) (143,171) (769,912) (1,398,277)
Dividends in excess of
net investment income.......... -- -- -- (2) -- --
Net realized gain on investments.. (1,652,450) (1,016,251) -- -- -- --
------------ ------------- ----------- ----------- ----------- -----------
Total Dividends................ (4,699,309) (7,065,072) (142,901) (143,173) (769,912) (1,398,277)
------------ ------------- ----------- ----------- ----------- -----------
Total Dividends to shareholders (5,617,179) (8,489,307) (160,947) (152,170) (1,732,153) (3,217,358)
------------ ------------- ----------- ----------- ----------- -----------
Net increase from share transactions(1). 12,830,082 10,311,739 908,029 8,333,795 3,428,809 14,758,843
------------ ------------- ----------- ----------- ----------- -----------
Net increase in net assets........... 9,485,620 13,769,629 835,683 8,516,198 2,704,110 17,023,834
------------ ------------- ----------- ----------- ----------- -----------
NET ASSETS at end of period
(including line A)................... $172,628,120 $ 163,142,500 $ 9,351,901 $ 8,516,218 $85,723,786 $83,019,676
============ ============= =========== =========== =========== ===========
(A) Undistributed (overdistributed) net
investment income................. $ (18,625) $ (18,625) $ 1,972 $ 1,972 $ (840) $ (839)
============ ============= =========== =========== =========== ===========
</TABLE>
- --------------------------------------------------
* The New Jersey Municipal Bond Fund commenced operations on April 3, 1998.
(1) For detail on share transactions by series, see Statements of Changes in
Net Assets - Capital Stock Activity on pages 42 and 43.
(a) Represents initial seed money.
See Notes to Financial Statements.
40
<PAGE>
<TABLE>
<CAPTION>
Connecticut Municipal Massachusetts Municipal Rhode Island Municipal
Bond Fund Bond Fund Bond Fund
--------------------------- ------------------------ ------------------------
Six months Year Six months Year Six months Year
ended April 30, ended ended April 30, ended ended April 30, ended
1999 October 31, 1999 October 31, 1999 October 31,
(unaudited) 1998 (unaudited) 1998 (unaudited) 1998
------------ ------------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
NET ASSETS at beginning of period....... $ 38,768,085 $ 33,221,284 $67,559,730 $47,304,792 $20,209,657 $17,134,415
------------ ------------- ----------- ----------- ----------- -----------
Increase in Net Assets
resulting from operations:
Net investment income................ 825,593 1,522,760 1,479,439 2,503,603 467,084 851,987
Net realized gain (loss) on
investments sold and written options 55,895 229,881 4,015 342,455 3,369 87,401
Net change in unrealized appreciation
(depreciation) of investments
and written options............... (413,709) 949,373 (363,365) 1,189,694 (136,683) 376,671
------------ ------------- ----------- ----------- ----------- -----------
Net increase in net assets
resulting from operations......... 467,779 2,702,014 1,120,089 4,035,752 333,770 1,316,059
------------ ------------- ----------- ----------- ----------- -----------
Dividends to shareholders from:
Retail A Shares:
Net investment income............. (500,508) (996,397) (919,207) (1,670,216) (469,881) (837,786)
Net realized gain on investments.. -- -- -- -- (87,472) (37,141)
------------ ------------- ----------- ----------- ----------- -----------
Total Dividends................ (500,508) (996,397) (919,207) (1,670,216) (557,353) (874,927)
------------ ------------- ----------- ----------- ----------- -----------
Retail B Shares:
Net investment income............. N/A N/A N/A N/A N/A N/A
Net realized gain on investments.. N/A N/A N/A N/A N/A N/A
------------ ------------- ----------- ----------- ----------- -----------
Total Dividends................ N/A N/A N/A N/A N/A N/A
------------ ------------- ----------- ----------- ----------- -----------
Trust Shares:
Net investment income............. (325,085) (526,684) (560,232) (814,636) -- --
Dividends in excess of
net investment income.......... -- -- -- -- -- --
Net realized gain on investments.. -- -- -- -- -- --
------------ ------------- ----------- ----------- ----------- -----------
Total Dividends................ (325,085) (526,684) (560,232) (814,636) -- --
------------ ------------- ----------- ----------- ----------- -----------
Total Dividends to shareholders (825,593) (1,523,081) (1,479,439) (2,484,852) (557,353) (874,927)
------------ ------------- ----------- ----------- ----------- -----------
Net increase from share transactions(1). 2,899,837 4,367,868 6,975,224 18,704,038 3,278,926 2,634,110
------------ ------------- ----------- ----------- ----------- -----------
Net increase in net assets........... 2,542,023 5,546,801 6,615,874 20,254,938 3,055,343 3,075,242
------------ ------------- ----------- ----------- ----------- -----------
NET ASSETS at end of period
(including line A)................... $ 41,310,108 $ 38,768,085 $74,175,604 $67,559,730 $23,265,000 $20,209,657
============ ============= =========== =========== =========== ============
(A) Undistributed (overdistributed) net
investment income................. $ (14,614) $ (14,614) $ (21,727) $ (21,727) $ (13,020) $ (10,223)
============ ============= =========== =========== =========== ===========
</TABLE>
41
<PAGE>
Galaxy Tax-Free Bond Funds
Statements of Changes in Net Assets --
Capital Stock Activity
<TABLE>
<CAPTION>
New Jersey New York
Tax-Exempt Bond Fund Municipal Bond Fund Municipal Bond Fund
------------------------- ------------------------ ------------------------
Six months Year Six months Period Six months Year
ended April 30, ended ended April 30, ended ended April 30, ended
1999 October 31, 1999 October 31, 1999 October 31,
(unaudited) 1998 (unaudited) 1998* (unaudited) 1998
----------- ----------- ----------- ---------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
DOLLAR AMOUNTS
Retail A Shares:
Sold ................................ $ 3,336,860 $ 4,120,071 $ 835,466 $ 795,210 $ 5,268,231 $16,948,796
Issued to shareholders in
reinvestment of dividends ......... 677,598 993,669 9,106 4,695 729,477 1,196,021
Repurchased ......................... (3,500,731) (6,326,395) (142,099) -- (6,931,873) (9,680,079)
------------ ----------- ----------- ----------- ----------- -----------
Net increase (decrease) in
shares outstanding ................ $ 513,727 $(1,212,655) $ 702,473 $ 799,905 $ (934,165) $ 8,464,738
============ =========== =========== =========== =========== ===========
Retail B Shares:
Sold ................................ $ 1,084,895 $ 1,425,757 N/A N/A N/A N/A
Issued to shareholders in
reinvestment of dividends ......... 60,313 58,048 N/A N/A N/A N/A
Repurchased ......................... (296,709) (509,491) N/A N/A N/A N/A
------------ ------------ ----------- ----------- ----------- -----------
Net increase in shares outstanding .. $ 848,499 $ 974,314 N/A N/A N/A N/A
============ =========== =========== =========== =========== ===========
Trust Shares:
Sold ................................ $ 12,867,147 $23,518,359 $ 399,500 $ 7,558,900 $ 7,091,742 $ 8,629,198
Issued to shareholders in
reinvestment of dividends ......... 2,318,481 3,119,314 -- -- 90,129 192,826
Repurchased ......................... (3,717,772) (16,087,593) (193,944) (25,010) (2,818,897) (2,527,919)
------------ ----------- ----------- ----------- ----------- -----------
Net increase in shares outstanding .. $ 11,467,856 $10,550,080 $ 205,556 $ 7,533,890 $ 4,362,974 $ 6,294,105
============ =========== =========== =========== =========== ===========
SHARE ACTIVITY
Retail A Shares:
Sold ................................ 303,223 367,769 81,969 79,151 461,916 1,490,812
Issued to shareholders in
reinvestment of dividends ......... 54,793 90,143 893 463 63,910 117,233
Repurchased ......................... (314,119) (568,242) (13,895) -- (606,613) (856,236)
------------ ----------- ----------- ----------- ----------- -----------
Net increase (decrease) in
shares outstanding ................ 43,897 (110,330) 68,967 79,614 (80,787) 751,809
============ =========== =========== =========== =========== ===========
Retail B Shares:
Sold ................................ 96,343 127,743 N/A N/A N/A N/A
Issued to shareholders in
reinvestment of dividends ......... 6,219 5,196 N/A N/A N/A N/A
Repurchased ......................... (26,690) (45,412) N/A N/A N/A N/A
------------ ----------- ----------- ----------- ----------- -----------
Net increase in shares outstanding .. 75,872 87,527 N/A N/A N/A N/A
============ =========== =========== =========== =========== ===========
Trust Shares:
Sold ................................ 1,152,383 2,106,905 39,137 754,850 621,053 771,140
Issued to shareholders in
reinvestment of dividends ......... 207,377 279,668 -- -- 7,895 17,092
Repurchased ......................... (333,953) (1,428,414) (19,018) (2,486) (247,377) (229,638)
------------ ----------- ----------- ----------- ----------- -----------
Net increase in shares outstanding .. 1,025,807 958,159 20,119 752,364 381,571 558,594
============ =========== =========== =========== =========== ===========
</TABLE>
- -----------------------------------------------------------
* The New Jersey Municipal Bond Fund commenced operations on April 3, 1998.
(1) As of April 30, 1999, the Rhode Island Municipal Bond Fund had not issued
Trust Shares.
See Notes to Financial Statements.
42
<PAGE>
<TABLE>
<CAPTION>
Connecticut Municipal Massachusetts Municipal Rhode Island Municipal
Bond Fund Bond Fund Bond Fund(1)
----------------------------- ------------------------- ------------------------
Six months Year Six months Year Six months Year
ended April 30, ended ended April 30, ended ended April 30, ended
1999 October 31, 1999 October 31, 1999 October 31,
(unaudited) 1998 (unaudited) 1998 (unaudited) 1998
----------- ----------- ----------- ------------ ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
DOLLAR AMOUNTS
Retail A Shares:
Sold ................................ $ 3,773,471 $ 7,407,851 $ 4,865,241 $ 19,663,945 $ 5,996,854 $ 8,016,637
Issued to shareholders in
reinvestment of dividends ......... 373,283 732,578 738,671 1,310,122 272,230 417,557
Repurchased ......................... (3,308,421) (7,427,287) (4,527,870) (11,175,520) (2,990,158) (5,800,084)
------------ ----------- ----------- ------------ ----------- -----------
Net increase (decrease) in
shares outstanding ................ $ 838,333 $ 713,142 $ 1,076,042 $ 9,798,547 $ 3,278,926 $ 2,634,110
============ =========== =========== ============ =========== ===========
Retail B Shares:
Sold ................................ N/A N/A N/A N/A N/A N/A
Issued to shareholders in
reinvestment of dividends ......... N/A N/A N/A N/A N/A N/A
Repurchased ......................... N/A N/A N/A N/A N/A N/A
------------ ----------- ----------- ------------ ----------- -----------
Net increase in shares outstanding .. N/A N/A N/A N/A N/A N/A
============ =========== =========== ============ =========== ===========
Trust Shares:
Sold ................................ $ 4,071,734 $13,217,871 $ 7,725,821 $ 12,225,250 $ -- $ --
Issued to shareholders in
reinvestment of dividends ......... 1,500 3,553 19,582 587 -- --
Repurchased ......................... (2,011,730) (9,566,698) (1,846,221) (3,320,346) -- --
------------ ----------- ----------- ------------ ----------- -----------
Net increase in shares outstanding .. $ 2,061,504 $ 3,654,726 $ 5,899,182 $ 8,905,491 $ -- $ --
============ =========== =========== ============ =========== ===========
SHARE ACTIVITY
Retail A Shares:
Sold ................................ 347,103 697,310 461,260 1,892,528 538,835 725,416
Issued to shareholders in
reinvestment of dividends ......... 37,441 64,175 70,009 126,721 24,446 37,745
Repurchased ......................... (307,078) (694,286) (429,505) (1,072,707) (267,980) (526,601)
------------ ----------- ----------- ------------ ----------- -----------
Net increase (decrease) in
shares outstanding ................ 77,466 67,199 101,764 946,542 295,301 236,560
============ =========== =========== ============ =========== ===========
Retail B Shares:
Sold ................................ N/A N/A N/A N/A N/A N/A
Issued to shareholders in
reinvestment of dividends ......... N/A N/A N/A N/A N/A N/A
Repurchased ......................... N/A N/A N/A N/A N/A N/A
------------ ----------- ----------- ------------ ----------- -----------
Repurchased ......................... N/A N/A N/A N/A N/A N/A
============ =========== =========== ============ =========== ===========
Trust Shares:
Sold ................................ 377,123 1,242,161 732,236 1,174,113 -- --
Issued to shareholders in
reinvestment of dividends ......... 139 308 1,857 57 -- --
Repurchased ......................... (186,577) (898,692) (174,378) (318,922) -- --
------------ ----------- ----------- ------------ ----------- -----------
Net increase in shares outstanding .. 190,685 343,777 559,715 855,248 -- --
============ =========== =========== ============ =========== ===========
</TABLE>
43
<PAGE>
Tax-Exempt Bond Fund
Financial Highlights
For a Share outstanding throughout each period.
Retail A Shares
<TABLE>
<CAPTION>
Six months ended Years ended October 31,
April 30, 1999 -------------------------------------------------------------------
(unaudited) 1998 1997 1996 1995 1994
----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period ....... $ 11.30 $ 11.06 $ 10.78 $ 10.78 $ 9.99 $ 11.12
----------- ----------- ----------- ----------- ----------- -----------
Income from Investment Operations:
Net investment income (A) .................. 0.23 0.48 0.50 0.50 0.52 0.53
Net realized and unrealized gain (loss)
on investments ........................... (0.08) 0.34 0.29 -- 0.79 (1.04)
----------- ----------- ----------- ----------- ----------- -----------
Total from Investment Operations ........... 0.15 0.82 0.79 0.50 1.31 (0.51)
----------- ----------- ----------- ----------- ----------- -----------
Less Dividends:
Dividends from net investment income ....... (0.23) (0.49) (0.50 (0.50) (0.52) (0.53)
Dividends from net realized capital gains .. (0.14) (0.09) (0.01) -- -- --
Dividends in excess of net realized
capital gains -- -- -- -- -- (0.09)
----------- ----------- ----------- ----------- ----------- -----------
Total Dividends ............................ (0.37) (0.58) (0.51 (0.50) (0.52) (0.62)
----------- ----------- ----------- ----------- ----------- -----------
Net increase (decrease) in net asset value . (0.22) 0.24 0.28 -- 0.79 (1.13)
----------- ----------- ----------- ----------- ----------- -----------
Net Asset Value, End of Period ............. $ 11.08 $ 11.30 $ 11.06 $ 10.78 $ 10.78 $ 9.99
=========== =========== =========== =========== =========== ===========
Total Return(2) ............................ 1.31%** 7.60% 7.49% 4.77% 13.40% (4.75)%
Ratios/Supplemental Data:
Net Assets, End of Period (000's) .......... $ 24,765 $ 24,764 $ 25,465 $ 28,339 $ 31,609 $ 35,911
Ratios to average net assets:
Net investment income including
reimbursement/waiver ....................... 4.16%* 4.32% 4.60% 4.68% 4.99% 5.01%
Operating expenses including
reimbursement/waiver ....................... 0.94%* 0.94% 0.95% 0.93% 0.91% 0.80%
Operating expenses excluding
reimbursement/waiver ....................... 1.14%* 1.15% 1.18% 1.18% 1.24% 1.03%
Portfolio Turnover Rate .................... 14%** 59% 78% 15% 11% 17%
</TABLE>
- ----------------------------------------------------
* Annualized
** Not Annualized
(1) The Fund began offering Retail B Shares on March 4, 1996.
(2) Calculation does not include the effect of any sales charge for Retail A
Shares and Retail B Shares.
(A) Net investment income per share before reimbursement/waiver of fees by the
Investment Advisor and/or Administrator for Retail A Shares for the six
months ended April 30, 1999 (unaudited) and the years ended October 31,
1998, 1997, 1996, 1995 and 1994 were $0.22, $0.46, $0.47, $0.48, $0.48 and
$0.50, respectively. Net investment income per share before reimbursement/
waiver of fees by the Investment Advisor and/or Administrator
for Trust Shares for the six months ended April 30, 1999 (unaudited) and
the years ended October 31, 1998, 1997, 1996, 1995 and 1994 were $0.23,
$0.48, $0.51, $0.51, $0.51 and $0.50, respectively. Net investment income
per share before reimbursement/waiver of fees by the Investment Advisor
and/or Administrator for Retail B Shares for the six months ended April 30,
1999 (unaudited), the years ended October 31, 1998 and 1997 and the period
ended October 31, 1996 were $0.19, $0.40, $0.40 and $0.25, respectively.
See Notes to Financial Statements.
44
<PAGE>
<TABLE>
<CAPTION>
Trust Shares
Years ended
Six months ended October 31,
April 30, 1999 -------------------------------------------------------------------
(unaudited) 1998 1997 1996 1995 1994
----------- ---------- ---------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period ....... $ 11.30 $ 11.06 $ 10.78 $ 10.78 $ 9.99 $ 11.12
----------- ----------- ----------- ----------- ----------- -----------
Income from Investment Operations:
Net investment income (A) .................. 0.24 0.50 0.53 0.53 0.54 0.53
Net realized and unrealized gain (loss)
on investments ........................... (0.08) 0.34 0.29 -- 0.79 (1.04)
----------- ----------- ----------- ----------- ----------- -----------
Total from Investment Operations ........... 0.16 0.84 0.82 0.53 1.33 (0.51)
----------- ----------- ----------- ----------- ----------- -----------
Less Dividends:
Dividends from net investment income ....... (0.24) (0.51) (0.53) (0.53) (0.54) (0.53)
Dividends from net realized capital gains .. (0.14) (0.09) (0.01) -- -- --
Dividends in excess of net realized
capital gains -- -- -- -- -- (0.09)
----------- ----------- ----------- ----------- ----------- -----------
Total Dividends ............................ (0.38) (0.60) (0.54) (0.53) (0.54) (0.62)
----------- ----------- ----------- ----------- ----------- -----------
Net increase (decrease) in net asset value . (0.22) 0.24 0.28 -- 0.79 (1.13)
----------- ----------- ----------- ----------- ----------- -----------
Net Asset Value, End of Period ............. $ 11.08 $ 11.30 $ 11.06 $ 10.78 $ 10.78 $ 9.99
=========== =========== =========== =========== =========== ===========
Total Return(2) ............................ 1.43%** 7.85% 7.75% 5.03% 13.62% (4.75)%
Ratios/Supplemental Data:
Net Assets, End of Period (000's) .......... $ 144,361 $ 135,664 $ 122,218 $ 103,163 $ 91,740 $ 91,647
Ratios to average net assets:
Net investment income including
reimbursement/waiver ....................... 4.39%* 4.55% 4.85% 4.91% 5.18% 5.01%
Operating expenses including
reimbursement/waiver ....................... 0.71%* 0.71% 0.70% 0.70% 0.72% 0.78%
Operating expenses excluding
reimbursement/waiver ....................... 0.91%* 0.92% 0.96% 0.95% 0.97% 1.00%
Portfolio Turnover Rate .................... 14%** 59% 78% 15% 11% 17%
<CAPTION>
Retail B Shares
Years ended
Six months ended October 31, Period ended
April 30, 1999 -------------------- October 31,
(unaudited) 1998 1997 1996(1)
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
Net Asset Value, Beginning of Period ....... $ 11.30 $ 11.06 $ 10.78 $ 10.94
---------- ---------- ---------- ----------
Income from Investment Operations:
Net investment income (A) .................. 0.20 0.42 0.43 0.27
Net realized and unrealized gain (loss)
on investments ........................... (0.08) 0.33 0.29 (0.16)
---------- ---------- ---------- ----------
Total from Investment Operations ........... 0.12 0.75 0.72 0.11
---------- ---------- ---------- ----------
Less Dividends:
Dividends from net investment income ....... (0.20) (0.42) (0.43) .27)
Dividends from net realized capital gains .. (0.14) (0.09) (0.01) --
Dividends in excess of net realized
capital gains -- -- -- --
---------- ---------- ---------- ----------
Total Dividends ............................ (0.34) (0.51) (0.44) (0.27)
---------- ---------- ---------- ----------
Net increase (decrease) in net asset value . (0.22) 0.24 0.28 (0.16)
---------- ---------- ---------- ----------
Net Asset Value, End of Period ............. $ 11.08 $ 11.30 $ 11.06 $ 10.78
========== ========== ========== ==========
Total Return(2) ............................ 1.00%** 6.95% 6.83% 1.08%**
Ratios/Supplemental Data:
Net Assets, End of Period (000's) .......... $ 3,502 $ 2,715 $ 1,690 $ 787
Ratios to average net assets:
Net investment income including
reimbursement/waiver ....................... 3.55%* 3.71% 3.95% 4.08%*
Operating expenses including
reimbursement/waiver ....................... 1.55%* 1.55% 1.60% 1.57%*
Operating expenses excluding
reimbursement/waiver ....................... 1.75%* 1.76% 1.83% 1.77%*
Portfolio Turnover Rate .................... 14%** 59% 78% 15%
</TABLE>
45
<PAGE>
New Jersey Municipal Bond Fund
Financial Highlights
For a Share outstanding throughout each period.
Retail A Shares
<TABLE>
<CAPTION>
Six months ended Period ended
April 30, 1999 October 31,
(unaudited) 1998(1)
---------------- ------------
<S> <C> <C>
Net Asset Value, Beginning of Period .................... $ 10.24 $ 10.00
---------- ----------
Income from Investment Operations:
Net investment income (A) ............................ 0.18 0.20
Net realized and unrealized gain (loss) on investments (0.09) 0.24
---------- ----------
Total from Investment Operations ................. 0.09 0.44
---------- ----------
Less Dividends:
Dividends from net investment income ................. (0.18) (0.20)
---------- ----------
Total Dividends .................................... (0.18) (0.20)
---------- ----------
Net increase (decrease) in net asset value .............. (0.09) 0.24
---------- ----------
Net Asset Value, End of Period .......................... $ 10.15 $ 10.24
========== ==========
Total Return(2) ......................................... 0.85%** 4.34%**
Ratios/Supplemental Data:
Net Assets, End of Period (000's) ....................... $ 1,509 $ 815
Ratios to average net assets:
Net investment income including reimbursement/waiver . 3.49%* 3.62%*
Operating expenses including reimbursement/waiver .... 1.13%* 1.09%*
Operating expenses excluding reimbursement/waiver .... 2.60%* 3.65%*
Portfolio Turnover Rate ................................. 11%** 53%**
</TABLE>
- --------------------------------------------------------------------------------
* Annualized.
** Not Annualized.
(1) The Fund commenced operations on April 3, 1998.
(2) Calculation does not include the effect of any sales charge for Retail A
Shares.
(A) Net investment income per share before reimbursement/waiver of fees by the
Investment Advisor and/or Administrator for Retail A Shares for the six
months ended April 30, 1999 (unaudited) and the period ended October 31,
1998 were $0.11 and $0.06, respectively. Net investment income per share
before reimbursement/waiver of fees by the Investment Advisor and/or
Administrator for Trust Shares for the six months ended April 30, 1999
(unaudited) and the period ended October 31, 1998 were $0.14 and $0.15,
respectively.
See Notes to Financial Statements.
46
<PAGE>
Trust Shares
<TABLE>
<CAPTION>
Six months ended Period ended
April 30, 1999 October 31,
(unaudited) 1998(1)
------------------ ---------------
<S> <C> <C>
Net Asset Value, Beginning of Period .................... $ 10.24 $ 10.00
----------- -------------
Income from Investment Operations:
Net investment income (A) ............................ 0.19 0.21
Net realized and unrealized gain (loss) on investments (0.09) 0.24
----------- -------------
Total from Investment Operations ................. 0.10 0.45
----------- -------------
Less Dividends:
Dividends from net investment income ................. (0.19) (0.21)
----------- -------------
Total Dividends .................................... (0.19) (0.21)
----------- -------------
Net increase (decrease) in net asset value .............. (0.09) 0.24
----------- -------------
Net Asset Value, End of Period .......................... $ 10.15 $ 10.24
=========== =============
Total Return(2) ......................................... 0.96%** 4.48%**
Ratios/Supplemental Data:
Net Assets, End of Period (000's) ....................... $ 7,843 $ 7,701
Ratios to average net assets:
Net investment income including reimbursement/waiver . 3.70%* 3.79%*
Operating expenses including reimbursement/waiver .... 0.92%* 0.92%*
Operating expenses excluding reimbursement/waiver .... 1.98%* 2.07%*
Portfolio Turnover Rate ................................. 11%** 53%**
</TABLE>
47
<PAGE>
New York Municipal Bond Fund
Financial Highlights
For a Share outstanding throughout each period.
Retail A Shares
<TABLE>
<CAPTION>
Six months ended Years ended October 31,
April 30, 1999 -------------------------------------------------------------
(unaudited) 1998 1997 1996 1995 1994
------------ ---------- --------- --------- --------- --------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period...... $ 11.44 $ 11.09 $ 10.75 $ 10.78 $ 9.89 $ 11.04
----------- ---------- --------- --------- --------- --------
Income from Investment Operations:
Net investment income (A).............. 0.23 0.48 0.49 0.48 0.49 0.49
Net realized and unrealized gain (loss)
on investments....................... (0.10) 0.35 0.34 (0.03) 0.89 (1.15)
----------- ---------- --------- --------- --------- --------
Total from Investment Operations... 0.13 0.83 0.83 0.45 1.38 (0.66)
----------- ---------- --------- --------- --------- --------
Less Dividends:
Dividends from net investment income... (0.23) (0.48) (0.49) (0.48) (0.49) (0.49)
----------- ---------- --------- --------- --------- --------
Total Dividends...................... (0.23) (0.48) (0.49) (0.48) (0.49) (0.49)
----------- ---------- --------- --------- --------- --------
Net increase (decrease) in net asset value (0.10) 0.35 0.34 (0.03) 0.89 (1.15)
----------- ---------- --------- --------- --------- --------
Net Asset Value, End of Period............ $ 11.34 $ 11.44 $ 11.09 $ 10.75 $ 10.78 $ 9.89
=========== ========== ========= ========= ========= ========
Total Return(1)........................... 1.12%** 7.65% 7.93% 4.31% 14.03% (6.14)%
Ratios/Supplemental Data:
Net Assets, End of Period (000's)......... $ 46,892 $ 48,218 $ 38,434 $ 40,154 $ 42,870 $ 42,451
Ratios to average net assets:
Net investment income including
reimbursement/waiver................. 4.02%* 4.27% 4.52% 4.50% 4.73% 4.64%
Operating expenses including
reimbursement/waiver................. 0.96%* 0.87% 0.94% 0.95% 0.92% 0.87%
Operating expenses excluding
reimbursement/waiver................. 1.17%* 1.20% 1.26% 1.35% 1.31% 1.10%
Portfolio Turnover Rate................... 9%** 27% 61% 12% 5% 18%
</TABLE>
- --------------------------------------------------------------------------------
* Annualized.
** Not Annualized.
(1) Calculation does not include the effect of any sales charge for Retail A
Shares.
(A) Net investment income per share before reimbursement/waiver of fees by the
Investment Advisor and/or Administrator for Retail A Shares for the six
months ended April 30, 1999 (unaudited) and the years ended October 31,
1998, 1997, 1996, 1995 and 1994 were $0.22, $0.45, $0.45, $0.44, $0.44 and
$0.46, respectively. Net investment income per share before
reimbursement/waiver of fees by the Investment Advisor and/or Administrator
for Trust Shares for the six months ended April 30, 1999 (unaudited) and
the years ended October 31, 1998, 1997, 1996, 1995 and 1994 were $0.22,
$0.47, $0.49, $0.47, $0.48 and $0.47, respectively.
See Notes to Financial Statements.
48
<PAGE>
Trust Shares
<TABLE>
<CAPTION>
Years ended
Six months ended October 31,
April 30, 1999 ---------------------------------------------------------------
(unaudited) 1998 1997 1996 1995 1994
----------- -------- -------- -------- ------- ---------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period...... $ 11.44 $ 11.09 $ 10.75 $ 10.78 $ 9.89 $ 11.04
-------- -------- -------- -------- ------- ---------
Income from Investment Operations:
Net investment income (A).............. 0.24 0.50 0.52 0.51 0.51 0.49
Net realized and unrealized gain (loss)
on investments....................... (0.10) 0.35 0.34 (0.03) 0.89 (1.15)
-------- -------- -------- -------- ------- ---------
Total from Investment Operations... 0.14 0.85 0.86 0.48 1.40 (0.66)
-------- -------- -------- -------- ------- ---------
Less Dividends:
Dividends from net investment income... (0.24) (0.50) (0.52) (0.51) (0.51) (0.49)
-------- -------- -------- -------- ------- ---------
Total Dividends...................... (0.24) (0.50) (0.52) (0.51) (0.51) (0.49)
-------- -------- -------- -------- ------- ---------
Net increase (decrease) in net asset value (0.10) 0.35 0.34 (0.03) 0.89 (1.15)
-------- -------- -------- -------- ------- ---------
Net Asset Value, End of Period............ $ 11.34 $ 11.44 $ 11.09 $ 10.75 $ 10.78 $ 9.89
======== ======== ======== ======== ======= =========
Total Return(1)........................... 1.22%** 7.82% 8.17% 4.55% 14.23% (6.14)%
Ratios/Supplemental Data:
Net Assets, End of Period (000's)......... $ 38,831 $ 34,801 $ 27,562 $ 23,762 $23,077 $ 24,209
Ratios to average net assets:
Net investment income including
reimbursement/waiver................. 4.21%* 4.42% 4.75% 4.75% 4.91% 4.64%
Operating expenses including
reimbursement/waiver................. 0.77%* 0.72% 0.71% 0.70% 0.74% 0.87%
Operating expenses excluding
reimbursement/waiver................. 0.97%* 0.99% 1.02% 1.10% 1.07% 1.08%
Portfolio Turnover Rate................... 9%** 27% 61% 12% 5% 18%
</TABLE>
49
<PAGE>
Connecticut Municipal Bond Fund
Financial Highlights
For a Share outstanding throughout each period.
Retail A Shares
<TABLE>
<CAPTION>
Six months ended Years ended October 31,
April 30, 1999 --------------------------------------------------------------
(unaudited) 1998 1997 1996 1995 1994
------------ ------- -------- -------- -------- -------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period...... $ 10.82 $ 10.47 $ 10.14 $ 10.13 $ 9.22 $ 10.32
-------- ------- -------- -------- -------- -------
Income from Investment Operations:
Net investment income (A).............. 0.21 0.43 0.45 0.42 0.44 0.46
Net realized and unrealized gain (loss)
on investments....................... (0.10) 0.35 0.33 0.01 0.91 (1.10)
-------- ------- -------- -------- -------- -------
Total from Investment Operations... 0.11 0.78 0.78 0.43 1.35 (0.64)
-------- ------- -------- -------- -------- -------
Less Dividends:
Dividends from net investment income... (0.21) (0.43) (0.45) (0.42) (0.44) (0.46)
-------- ------- -------- -------- -------- -------
Total Dividends...................... (0.21) (0.43) (0.45) (0.42) (0.44) (0.46)
-------- ------- -------- -------- -------- -------
Net increase (decrease) in net asset value (0.10) 0.35 0.33 0.01 0.91 (1.10)
-------- ------- -------- -------- -------- -------
Net Asset Value, End of Period............ $ 10.72 $ 10.82 $ 10.47 $ 10.14 $ 10.13 $ 9.22
======== ======= ======== ======== ======== =======
Total Return (1).......................... 1.06%** 7.58% 7.86% 4.32% 14.94% (6.39)%
Ratios/Supplemental Data:
Net Assets, End of Period (000's)......... $ 25,472 $24,856 $ 23,355 $ 23,244 $ 18,066 $18,229
Ratios to average net assets:
Net investment income including
reimbursement/waiver................. 3.99%* 4.02% 4.30% 4.13% 4.53% 4.66%
Operating expenses including
reimbursement/waiver................. 0.87%* 0.88% 0.70% 0.70% 0.68% 0.25%
Operating expenses excluding
reimbursement/waiver................. 1.27%* 1.31% 1.31% 1.38% 1.48% 1.42%
Portfolio Turnover Rate................... 13%** 46% 42% 3% 7% 4%
</TABLE>
- --------------------------------------------------------------------------------
* Annualized.
** Not Annualized.
(1) Calculation does not include the effect of any sales charge for Retail A
Shares.
(A) Net investment income per share before reimbursement/waiver of fees by the
Investment Advisor and/or Administrator for Retail A Shares for the six
months ended April 30, 1999 (unaudited) and the years ended October 31,
1998, 1997, 1996, 1995 and 1994 were $0.19, $0.38, $0.38, $0.35, $0.37 and
$0.34, respectively. Net investment income per share before
reimbursement/waiver of fees by the Investment Advisor and/or Administrator
for Trust Shares for the six months ended April 30, 1999 (unaudited) and
the years ended October 31, 1998, 1997, 1996, 1995 and 1994 were $0.21,
$0.40, $0.41, $0.37, $0.38 and $0.35, respectively.
See Notes to Financial Statements.
50
<PAGE>
Trust Shares
<TABLE>
<CAPTION>
Years ended
Six months ended October 31,
April 30, 1999 --------------------------------------------------------------
(unaudited) 1998 1997 1996 1995 1994
----------- -------- -------- -------- ------- --------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period...... $ 10.82 $ 10.47 $ 10.14 $ 10.13 $ 9.22 $ 10.32
------- -------- -------- -------- ------- --------
Income from Investment Operations:
Net investment income (A).............. 0.23 0.45 0.47 0.44 0.46 0.46
Net realized and unrealized gain (loss)
on investments....................... (0.10) 0.35 0.33 0.01 0.91 (1.10)
------- -------- -------- -------- ------- --------
Total from Investment Operations... 0.13 0.80 0.80 0.45 1.37 (0.64)
------- -------- -------- -------- ------- --------
Less Dividends:
Dividends from net investment income... (0.23) (0.45) (0.47) (0.44) (0.46) (0.46)
------- -------- -------- -------- ------- --------
Total Dividends...................... (0.23) (0.45) (0.47) (0.44) (0.46) (0.46)
------- -------- -------- -------- ------- --------
Net increase (decrease) in net asset value (0.10) 0.35 0.33 0.01 0.91 (1.10)
------- -------- -------- -------- ------- --------
Net Asset Value, End of Period............ $ 10.72 $ 10.82 $ 10.47 $ 10.14 $ 10.13 $ 9.22
======= ======== ======== ======== ======= ========
Total Return (1).......................... 1.16%** 7.81% 8.06% 4.54% 15.21% (6.37)%
Ratios/Supplemental Data:
Net Assets, End of Period (000's)......... $15,838 $ 13,913 $ 9,866 $ 6,348 $ 4,083 $ 4,419
Ratios to average net assets:
Net investment income including
reimbursement/waiver................. 4.21%* 4.24% 4.51% 4.34% 4.76% 4.66%
Operating expenses including
reimbursement/waiver................. 0.66%* 0.67% 0.49% 0.49% 0.45% 0.23%
Operating expenses excluding
reimbursement/waiver................. 1.06%* 1.10% 1.10% 1.17% 1.24% 1.41%
Portfolio Turnover Rate................... 13%** 46% 42% 3% 7% 4%
</TABLE>
51
<PAGE>
Massachusetts Municipal Bond Fund
Financial Highlights
For a Share outstanding throughout each period.
Retail A Shares
<TABLE>
<CAPTION>
Six months ended Years ended October 31,
April 30, 1999 -------------------------------------------------------------
(unaudited) 1998 1997 1996 1995 1994
------------ ------- ------- ------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period...... $ 10.53 $ 10.25 $ 9.94 $ 9.98 $ 9.12 $ 10.24
---------- ------- ------- ------- -------- --------
Income from Investment Operations:
Net investment income (A).............. 0.22 0.46 0.45 0.43 0.44 0.47
Net realized and unrealized gain (loss)
on investments....................... (0.05) 0.27 0.32 (0.04) 0.86 (1.12)
---------- ------- ------- ------- -------- --------
Total from Investment Operations... 0.17 0.73 0.77 0.39 1.30 (0.65)
---------- ------- ------- ------- -------- --------
Less Dividends:
Dividends from net investment income... (0.22) (0.45) (0.46) (0.43) (0.44) (0.47)
---------- ------- ------- ------- -------- --------
Total Dividends...................... (0.22) (0.45) (0.46) (0.43) (0.44) (0.47)
---------- ------- ------- ------- -------- --------
Net increase (decrease) in net asset value (0.05) 0.28 0.31 (0.04) 0.86 (1.12)
---------- ------- ------- ------- -------- --------
Net Asset Value, End of Period............ $ 10.48 $ 10.53 $ 10.25 $ 9.94 $ 9.98 $ 9.12
========== ======= ======= ======= ======== ========
Total Return(1)........................... 1.58%** 7.22% 7.92% 4.05% 14.52% (6.46)%
Ratios/Supplemental Data:
Net Assets, End of Period (000's)......... $45,049 $44,189 $33,318 $26,275 $ 16,113 $ 15,966
Ratios to average net assets:
Net investment income including
reimbursement/waiver................. 4.12%* 4.30% 4.38% 4.42% 4.56% 4.89%
Operating expenses including
reimbursement/waiver................. 0.79%* 0.78% 0.63% 0.66% 0.70% 0.33%
Operating expenses excluding
reimbursement/waiver................. 1.19%* 1.21% 1.20% 1.32% 1.58% 1.43%
Portfolio Turnover Rate................... 17%** 44% 48% 16% 19% 11%
</TABLE>
- --------------------------------------------------------------------------------
* Annualized.
** Not Annualized.
(1) Calculation does not include the effect of any sales charge for Retail A
Shares.
(A) Net investment income per share before reimbursement/waiver of fees by the
Investment Advisor and/or Administrator for Retail A Shares for the six
months ended April 30, 1999 (unaudited) and the years ended October 31,
1998, 1997, 1996, 1995 and 1994 were $0.20, $0.41, $0.39, $0.37, $0.36 and
$0.37, respectively. Net investment income per share before
reimbursement/waiver of fees by the Investment Advisor and/or Administrator
for Trust Shares for the six months ended April 30, 1999 (unaudited) and
the years ended October 31, 1998, 1997, 1996, 1995 and 1994 were $0.21,
$0.42, $0.40, $0.40, $0.38 and $0.38, respectively.
See Notes to Financial Statements.
52
<PAGE>
Trust Shares
<TABLE>
<CAPTION>
Years ended
Six months ended October 31,
April 30, 1999 -------------------------------------------------------
(unaudited) 1998 1997 1996 1995 1994
----------- -------- ------- ------- ------- --------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period...... $ 10.53 $ 10.25 $ 9.94 $ 9.98 $ 9.12 $ 10.24
------- -------- ------- ------- ------- --------
Income from Investment Operations:
Net investment income (A).............. 0.25 0.47 0.46 0.46 0.45 0.48
Net realized and unrealized gain (loss)
on investments....................... (0.05) 0.27 0.32 (0.04) 0.86 (1.12)
------- -------- ------- ------- ------- --------
Total from Investment Operations... 0.20 0.74 0.78 0.42 1.31 (0.64)
------- -------- ------- ------- ------- --------
Less Dividends:
Dividends from net investment income... (0.25) (0.46) (0.47) (0.46) (0.45) (0.48)
------- -------- ------- ------- ------- --------
Total Dividends...................... (0.25) (0.46) (0.47) (0.46) (0.45) (0.48)
------- -------- ------- ------- ------- --------
Net increase (decrease) in net asset value (0.05) 0.28 0.31 (0.04) 0.86 (1.12)
------- -------- ------- ------- ------- --------
Net Asset Value, End of Period............ $ 10.48 $ 10.53 $ 10.25 $ 9.94 $ 9.98 $ 9.12
======= ======== ======= ======= ======= ========
Total Return(1)........................... 1.67%** 7.42% 8.06% 4.27% 14.72% (6.46)%
Ratios/Supplemental Data:
Net Assets, End of Period (000's)......... $29,127 $ 23,371 $13,986 $11,047 $ 7,607 $ 5,617
Ratios to average net assets:
Net investment income including
reimbursement/waiver................. 4.31%* 4.49% 4.57% 4.60% 4.73% 4.89%
Operating expenses including
reimbursement/waiver................. 0.60%* 0.60% 0.44% 0.48% 0.52% 0.33%
Operating expenses excluding
reimbursement/waiver................. 1.00%* 1.03% 1.01% 1.14% 1.31% 1.41%
Portfolio Turnover Rate................... 17%** 44% 48% 16% 19% 11%
</TABLE>
53
<PAGE>
Rhode Island Municipal Bond Fund
Financial Highlights
For a Share outstanding throughout each period.
Retail A Shares
<TABLE>
<CAPTION>
Six months ended Years ended October 31, Period ended
April 30, 1999 -------------------------------------- October 31,
(unaudited) 1998 1997 1996 1995(1)
----------- -------- -------- -------- -----------
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period........... $ 11.18 $ 10.91 $ 10.65 $ 10.67 $ 10.00
------- -------- -------- -------- -------
Income from Investment Operations:
Net investment income (A)................... 0.24 0.50 0.48 0.51 0.44
Net realized and unrealized gain (loss)
on investments............................ (0.07) 0.29 0.32 0.03 0.67
------- -------- -------- -------- -------
Total from Investment Operations.......... 0.17 0.79 0.80 0.54 1.11
------- -------- -------- -------- -------
Less Dividends:
Dividends from net investment income........ (0.24) (0.50) (0.50) (0.51) (0.44)
Dividends from net realized capital gains... (0.05) (0.02) (0.04) (0.05) --
------- -------- -------- -------- -------
Total Dividends.......................... (0.29) (0.52) (0.54) (0.56) (0.44)
------- -------- -------- -------- -------
Net increase (decrease) in net asset value..... (0.12) 0.27 0.26 (0.02) 0.67
------- -------- -------- -------- -------
Net Asset Value, End of Period................. $ 11.06 $ 11.18 $ 10.91 $ 10.65 $ 10.67
======= ======== ======== ======== =======
Total Return(2)................................ 1.50%** 7.35% 7.78% 5.22% 11.29%**
Ratios/Supplemental Data:
Net Assets, End of Period (000's).............. $23,265 $ 20,210 $ 17,134 $ 14,900 $10,850
Ratios to average net assets:
Net investment income including
reimbursement/waiver...................... 4.33%* 4.52% 4.50% 4.78% 5.13%*
Operating expenses including
reimbursement/waiver 0.79%* 0.81% 0.83% 0.77% 0.40%*
Operating expenses excluding
reimbursement/waiver 1.19%* 1.23% 1.34% 1.34% 2.25%*
Portfolio Turnover Rate........................ 18%** 41% 19% 13% 34%**
</TABLE>
- --------------------------------------------------------------------------------
* Annualized
** Not Annualized
(1) The Fund commenced operations on December 20, 1994.
(2) Calculation does not include the effect of any sales charge for Retail A
Shares.
(A) Net investment income per share before reimbursement/waiver of fees by the
Investment Advisor and/or Administrator for the six months ended April 30,
1999, (unaudited), the years ended October 31, 1998, 1997 and 1996 and the
period ended October 31, 1995 were $0.21, $0.45, $0.43, $0.45 and $0.28,
respectively.
See Notes to Financial Statements.
54
<PAGE>
Notes to Financial Statements (unaudited)
1. Organization
The Galaxy Fund, a Massachusetts business trust (the "Trust"), is registered
under the Investment Company Act of 1940, as amended, as an open-end management
investment company. As of the date of this report, the Trust offered twenty-nine
managed investment portfolios. The accompanying financial statements and
financial highlights are those of the Tax-Exempt Bond, New Jersey Municipal
Bond, New York Municipal Bond, Connecticut Municipal Bond, Massachusetts
Municipal Bond and Rhode Island Municipal Bond Funds (individually, a "Fund",
collectively, the "Funds") only.
Each Fund is authorized to issue two series of shares (Trust Shares and Retail
A Shares), except for the Tax-Exempt Bond Fund, which is authorized to issue
five series of shares (Trust Shares, Retail A Shares, Retail B Shares, A Prime
Shares and B Prime Shares). As of April 30, 1999, the Rhode Island Municipal
Bond Fund has offered only Retail A Shares and the Tax-Exempt Bond Fund has
offered only Trust Shares, Retail A Shares and Retail B Shares. Trust Shares,
Retail A Shares, Retail B Shares, A Prime Shares and B Prime Shares are
substantially the same except that (i) Retail A Shares are subject to a maximum
3.75% front-end sales charge, (ii) A Prime Shares are subject to a maximum 4.75%
front-end sales charge, (iii) Retail B Shares and B Prime Shares are subject to
a maximum 5.00% contingent deferred sales charge, and (iv) each series of shares
bears the following series specific expenses: distribution fees and/or
shareholder servicing fees and transfer agency charges. Six years after
purchase, Retail B Shares will convert automatically to Retail A Shares and
eight years after purchase, B Prime Shares will convert automatically to A Prime
Shares.
2. Significant Accounting Policies
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 and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of income and expenses during the reporting period. Actual
results could differ from those estimates. The following is a summary of
significant accounting policies in conformity with generally accepted accounting
principles consistently followed by the Funds in the preparation of their
financial statements.
Portfolio Valuation: Investment securities are valued by an independent
pricing service approved by the Trust's Board of Trustees. When, in the judgment
of the service, quoted bid prices are readily available and are representative
of the bid side of the market, investments are valued at the mean between quoted
bid prices and asked prices. Other investments are carried at fair value as
determined by the service based on methods which include consideration of yields
or prices of bonds of comparable quality, coupon maturity and type; indications
as to values from dealers; and general market conditions. Short-term obligations
that mature in 60 days or less are valued at amortized cost, which approximates
fair value. All other securities and other assets are appraised at their fair
value as determined in good faith under consistently applied procedures
established by and under the general supervision of the Board of Trustees.
Securities Transactions and Investment Income: Securities transactions are
accounted for on a trade date basis. Net realized gains or losses on sales of
securities are determined by the identified cost method. Interest and dividend
income is recorded on the accrual basis. Investment income and realized and
unrealized gains and losses are allocated to the separate series of a Fund based
upon the relative net assets of each series.
Dividends to Shareholders: Dividends from net investment income are determined
separately for each series and are declared daily and paid monthly. Net realized
capital gains, if any, are distributed at least annually.
Income dividends and capital gain dividends are determined in accordance with
income tax regulations which may differ from generally accepted accounting
principles.
Federal Income Taxes: The Trust treats each Fund as a separate entity for
federal income tax purposes. Each Fund intends to continue to qualify each year
as a "regulated investment company" under Subchapter M of the Internal Revenue
Code. By so qualifying, each Fund will not be subject to federal income taxes to
the extent that it distributes substantially all of its taxable or tax-exempt
income, if any, for its tax year ending October 31. In addition, by distributing
in each calendar year substantially all of its net investment income, capital
gains and certain other amounts, if any, each Fund will not be subject to a
federal excise tax. Therefore, no federal income or excise tax provision is
recorded.
Expenses: The Trust accounts separately for the assets, liabilities and
operations of each Fund. Expenses directly attributable to a Fund are charged to
the Fund, while expenses which are attributable to more than one fund of the
Trust are allocated among the respective funds.
In addition, expenses of a Fund not directly attributable to the operations of
a particular series of shares of the Fund are allocated to the separate series
based upon the relative net assets of
55
<PAGE>
Notes to Financial Statements
each series. Operating expenses directly attributable to a series of shares of a
Fund are charged to the operations of that series.
Organization Costs: Each Fund bears all costs in connection with its
organization, including the fees and expenses of registering and qualifying its
initial shares for distribution under federal and state securities laws. All
such costs are amortized using the straight-line method over a period of five
years beginning with the commencement of each Fund's operations. In the event
that any of the initial shares purchased by a Fund's sponsor are redeemed during
such period by any holder thereof, the Fund involved will be reimbursed by such
holder for any unamortized organization costs in the same proportion as the
number of initial shares being redeemed bears to the number of initial shares
outstanding at the time of redemption.
When-Issued Securities: Each Fund may purchase and sell securities, such as
municipal obligations, on a "when-issued" basis. Delivery of the security and
payment take place after the date of the commitment to purchase and such
securities are subject to market fluctuations during this period. The fair value
of these securities is determined in the same manner as other municipal
obligations. The Trust's custodian will set aside cash or liquid portfolio
securities equal to the amount of the when-issued commitment in a separate
account.
3. Investment Advisory, Administration, Distribution,
Shareholder Services and Other Fees
The Trust and Fleet Investment Advisors Inc. (the "Investment Advisor" or
"Fleet"), an indirect wholly-owned subsidiary of Fleet Financial Group, Inc.,
are parties to an investment advisory agreement under which the Investment
Advisor provides services for a fee, computed daily and paid monthly, at the
annual rate of 0.75% of the average daily net assets of each Fund (See Note 4).
The Trust and First Data Investor Services Group, Inc. ("Investor Services
Group"), a wholly-owned subsidiary of First Data Corporation, are parties to an
administration agreement under which Investor Services Group (the
"Administrator") provides services for a fee, computed daily and paid monthly,
at the annual rate, effective September 10, 1998, of 0.09% of the first $2.5
billion of the combined average daily net assets of the Funds and the other
funds offered by the Trust (whose financial statements are provided in separate
reports), 0.085% of the next $2.5 billion of combined average daily net assets,
0.075% of the next $7 billion of combined average daily net assets, 0.065% of
the next $3 billion of combined average daily net assets, 0.06% of the next $3
billion of combined average daily net assets and 0.0575% of combined average
daily net assets in excess of $18 billion. Prior to September 10, 1998, Investor
Services Group received administration fees at the annual rate of 0.09% of the
first $2.5 billion of combined average daily net assets of the Funds and the
other funds offered by the Trust, 0.085% of the next $2.5 billion of combined
average daily net assets and 0.075% of combined average daily net assets over $5
billion.
In addition, Investor Services Group also provides certain fund accounting,
custody administration and transfer agency services in accordance with certain
fee arrangements. Pursuant to such fee arrangements, Investor Services Group
compensates The Chase Manhattan Bank, the Trust's custodian bank, for its
services.
First Data Distributors, Inc. (the "Distributor"), a wholly-owned subsidiary
of Investor Services Group and an indirect wholly-owned subsidiary of First Data
Corporation, serves as the exclusive distributor of the Trust's shares.
The Trust has adopted a shareholder services plan ("Services Plan") with
respect to Retail A Shares and Trust Shares of the Funds. Currently, the
Services Plan has not been implemented with respect to the Funds' Trust Shares.
The Services Plan provides compensation to institutions (including and currently
limited to Fleet Bank and its affiliates) which provide administrative and
support services to their customers who beneficially own Retail A Shares at an
aggregate annual rate not to exceed 0.30% of the average daily net asset value
of the outstanding Retail A Shares of each Fund beneficially owned by such
customers. The Trust, under the direction of the Board of Trustees, is currently
limiting fees payable under the Services Plan with respect to each Fund to an
aggregate annual rate not to exceed 0.15% of the average daily net asset value
of the outstanding Retail A Shares beneficially owned by such customers. No fees
were charged under the Services Plan with respect to the Rhode Island Municipal
Bond Fund for the six months ended April 30, 1999.
The Trust has adopted a distribution and shareholder services plan (the "12b-1
Plan") with respect to Retail B Shares of the Tax-Exempt Bond Fund. Under the
12b-1 Plan, the Trust may pay (i) the Distributor or another person for expenses
and activities primarily intended to result in the sale of Retail B Shares, (ii)
institutions for shareholder liaison services and (iii) institutions for
administrative support services. Currently, payments under the 12b-1 Plan for
distribution services are being made solely to broker-dealer affiliates of Fleet
Bank and payments under the 12b-1 Plan for shareholder liaison and shareholder
administrative support services are being made solely to Fleet Bank and its
affilitates. Payments for distribution expenses may not exceed an annual rate of
0.65% of the average daily net assets attributable to each of the Fund's out-
56
<PAGE>
Notes to Financial Statements
standing Retail B Shares. The fees for shareholder liaison services and/or
administrative support services may not exceed the annual rates of 0.15% and
0.15%, respectively, of the average daily net assets attributable to the Fund's
outstanding Retail B Shares owned of record or beneficially by customers of
institutions. The Trust, under the direction of the Board of Trustees, is
currently limiting each Fund's payments for shareholder liaison and
administrative support services under the 12b-1 Plan to an aggregate fee of not
more than 0.15% of the average daily net asset value of Retail B Shares owned of
record or beneficially by customers of institutions. For the six months ended
April 30, 1999, the Funds paid fees under the Services Plan and 12b-1 Plan as
follows:
<TABLE>
<CAPTION>
12b-1 Plan
Services ------------------------
Fund Plan Services Distribution
---- ---- -------- ------------
<S> <C> <C> <C>
Tax-Exempt Bond.............. $17,205 $ 2,036 $ 9,731
New Jersey Municipal Bond.... 786 N/A N/A
New York Municipal Bond...... 34,418 N/A N/A
Connecticut Municipal Bond... 18,611 N/A N/A
Massachusetts Municipal Bond. 32,583 N/A N/A
Rhode Island Municipal Bond.. -- N/A N/A
</TABLE>
The Trust has adopted a Distribution Plan (the "A Prime Shares Plan") with
respect to A Prime Shares of the Tax-Exempt Bond Fund. Under the A Prime Shares
Plan, the Trust may pay the Distributor or another person for expenses and
activities primarily intended to result in the sale of A Prime Shares. Payments
by the Trust under the A Prime Shares Plan may not exceed the annual rate of
0.30% of the average daily net assets attributable to the Fund's outstanding A
Prime Shares. The Trust, under the direction of the Board of Trustees, intends
to limit the Fund's payments under the A Prime Shares Plan to an annual rate of
not more than 0.25% of the average daily net asset value of the Fund's
outstanding A Prime Shares.
The Trust has adopted a Distribution and Services Plan (the "B Prime Shares
Plan") with respect to B Prime Shares of the Tax-Exempt Bond Fund. Under the B
Prime Shares Plan, the Trust may pay (i) the Distributor or another person for
expenses and activities primarily intended to result in the sale of B Prime
Shares, (ii) institutions for shareholder liaison services, and (iii)
institutions for administrative support services. Payments for distribution
expenses may not exceed the annual rate of 0.75% of the average daily net assets
attributable to the Fund's outstanding B Prime Shares. The fees for shareholder
liaison services and/or administrative support services may not exceed the
annual rates of 0.25% and 0.25%, respectively, of the average daily net assets
attributable to the Fund's outstanding B Prime Shares owned of record or
beneficially by customers of institutions. The Trust, under the direction of the
Board of Trustees, intends to limit the Fund's payments for shareholder liaison
and administrative support services under the B Prime Shares Plan to an
aggregate fee of not more than 0.25% of the average daily net asset value of B
Prime Shares owned of record or beneficially by customers of institutions. For
the period ended April 30, 1999, the Tax-Exempt Bond Fund paid no fees under the
A Prime Shares Plan and B Prime Shares Plan.
Retail A Shares, Retail B Shares, Trust Shares, A Prime Shares and B Prime
Shares of the Funds each bear series specific transfer agent charges based upon
the number of shareholder accounts for each series. For the six months ended
April 30, 1999, transfer agent charges for each series were as follows:
<TABLE>
<CAPTION>
Fund Retail A Retail B Trust
---- -------- -------- -----
<S> <C> <C> <C>
Tax-Exempt Bond.............. $11,454 $844 $58
New Jersey Municipal Bond.... 2,453 N/A 27
New York Municipal Bond...... 12,854 N/A 33
Connecticut Municipal Bond... 8,024 N/A 31
Massachusetts Municipal Bond. 10,240 N/A 29
Rhode Island Municipal Bond.. 2,480 N/A --
</TABLE>
For the period ended April 30, 1999, no transfer agent charges were paid with
respect to A Prime Shares and B Prime Shares of the Tax-Exempt Bond Fund.
Certain officers of the Trust may be officers of the Administrator. Such
officers receive no compensation from the Trust for serving in their respective
roles. No officer, director or employee of the Investment Advisor serves as an
officer, trustee or employee of the Trust. Effective March 5, 1998, each Trustee
is entitled to receive for services as a trustee of the Trust, The Galaxy VIP
Fund ("VIP") and Galaxy Fund II ("Galaxy II") an aggregate fee of $40,000 per
annum plus certain other fees for attending or participating in meetings as well
as reimbursement for expenses incurred in attending meetings. Prior to March 5,
1998, each Trustee was entitled to receive for services as a trustee of the
Trust, VIP and Galaxy II an aggregate fee of $29,000 per annum plus certain
other fees for attending or participating in meetings as well as reimbursement
for expenses incurred in attending meetings. The Chairman of the Boards of
Trustees and the President and Treasurer of the Trust, VIP and Galaxy II are
also entitled to additional fees for their services in these capacities. These
fees are allocated among the funds of the Trust, VIP and Galaxy II, based on
their relative net assets.
Each Trustee is eligible to participate in The Galaxy Fund/The Galaxy VIP Fund
/Galaxy Fund II Deferred Compensation Plan (the "Plan"), an unfunded,
non-qualified deferred compensation plan. The Plan allows each trustee to defer
receipt of all or a percentage of fees which otherwise would be payable for
services performed.
Expenses for the six months ended April 30, 1999 include legal fees paid to
Drinker Biddle & Reath LLP. A partner of that firm is Secretary to the Trust.
57
<PAGE>
Notes to Financial Statements
4. Waiver of Fees and Reimbursement of Expenses
The Advisor and/or its affiliates and/or the Administrator voluntarily agreed
to waive a portion of their fees and/or reimburse the Funds for certain expenses
so that total expenses would not exceed certain expense limitations established
for each Fund. The respective parties, at their discretion, may revise or
discontinue the voluntary fee waivers and/or expense reimbursements at any time.
For the six months ended April 30, 1999, the Investment Advisor and
Administrator waived fees and/or reimbursed expenses with respect to the Funds
as follows:
<TABLE>
<CAPTION>
Fund Fees Waived
---- -----------
<S> <C>
Tax-Exempt Bond.............. $167,017
New Jersey Municipal Bond.... 44,851
New York Municipal Bond...... 84,415
Connecticut Municipal Bond... 81,039
Massachusetts Municipal Bond. 141,088
Rhode Island Municipal Bond.. 43,095
<CAPTION>
Expenses
Fund Reimbursed
---- ----------
<S> <C>
New Jersey Municipal Bond.... $ 3,854
New York Municipal Bond...... 1,333
</TABLE>
5. Shares of Beneficial Interest
The Trust's Declaration of Trust authorizes the Trustees to issue an unlimited
number of shares of beneficial interest, each with a par value of $0.001. Shares
of the Trust are currently classified into thirty classes of shares each
consisting of one or more series including: Class M - Series 1 shares (Trust
Shares), Class M - Series 2 shares (Retail A Shares), Class M - Series 3 shares
(Retail B Shares), Class M - Series 4 shares (A Prime Shares) and Class M -
Series 5 shares (B Prime Shares) - Tax-Exempt Bond Fund; Class Y - Series 1
shares (Trust Shares) and Class Y - Series 2 shares (Retail A Shares) - New
Jersey Municipal Bond Fund; Class O - Series 1 shares (Trust Shares) and Class O
- - Series 2 shares (Retail A Shares) - New York Municipal Bond Fund; Class P -
Series 1 shares (Trust Shares) and Class P - Series 2 Shares (Retail A Shares) -
Connecticut Municipal Bond Fund; Class Q - Series 1 shares (Trust Shares) and
Class Q - Series 2 shares (Retail A Shares) - Massachusetts Municipal Bond Fund;
and Class R - Series 1 shares (Trust Shares) and Class R - Series 2 shares
(Retail A Shares) - Rhode Island Municipal Bond Fund.
Each share represents an equal proportionate interest in the respective Fund,
bears the same fees and expenses (except that Retail A Shares bear the expense
of payments under the Services Plan, Retail B Shares bear the expense of
payments under the 12b-1 Plan, A Prime Shares bear the expense of payments under
the A Prime Shares Plan, B Prime Shares bear the expense of payments under the B
Prime Shares Plan and Trust Shares, Retail A Shares, Retail B Shares, A Prime
Shares and B Prime Shares each bear series specific transfer agent charges) and
are entitled to such dividends and distributions of income earned as are
declared at the discretion of the Trust's Board of Trustees.
Shareholders are entitled to one vote for each full share held and a
proportionate fractional vote for each fractional share held, and will vote in
the aggregate and not by class or series, except as otherwise expressly required
by law or when the Board of Trustees determines that the matter to be voted on
affects only the interests of shareholders of a particular class or series.
6. Purchases and Sales of Securities
The cost of purchases and proceeds from sales of securities, other than
short-term investments, for the six months ended April 30, 1999 were as follows:
<TABLE>
<CAPTION>
Fund Purchases Sales
---- --------- -----
<S> <C> <C>
Tax-Exempt Bond.............. $35,406,937 $22,838,740
New Jersey Municipal Bond.... 1,698,045 963,678
New York Municipal Bond...... 11,107,491 7,260,062
Connecticut Municipal Bond... 8,036,925 5,020,388
Massachusetts Municipal Bond. 19,068,228 11,712,835
Rhode Island Municipal Bond.. 7,236,916 3,777,864
</TABLE>
The aggregate gross unrealized appreciation and depreciation, net unrealized
appreciation (depreciation), and cost for all securities as computed on a
federal income tax basis at April 30, 1999 for each Fund is as follows:
<TABLE>
<CAPTION>
Fund Appreciation (Depreciation)
---- ------------ --------------
<S> <C> <C>
Tax-Exempt Bond.............. $ 6,815,231 $ (233,470)
New Jersey Municipal Bond.... 123,074 (9,121)
New York Municipal Bond...... 3,715,974 (79,328)
Connecticut Municipal Bond... 1,777,508 (29,050)
Massachusetts Municipal Bond. 2,218,686 (96,392)
Rhode Island Municipal Bond.. 918,855 (35,012)
</TABLE>
<TABLE>
<CAPTION>
Fund Net Cost
---- --- ----
<S> <C> <C>
Tax-Exempt Bond.............. $ 6,581,761 $165,264,351
New Jersey Municipal Bond.... 113,953 9,161,264
New York Municipal Bond...... 3,636,646 81,099,501
Connecticut Municipal Bond... 1,748,458 39,095,205
Massachusetts Municipal Bond. 2,122,294 70,915,848
Rhode Island Municipal Bond.. 883,843 22,127,474
</TABLE>
58
<PAGE>
Notes to Financial Statements
At October 31, 1998, the following Funds had capital loss carryforwards:
<TABLE>
<CAPTION>
Fund Amount Expiration
---- ------ ----------
<S> <C> <C>
New Jersey Municipal Bond.... $ 687 2006
New York Municipal Bond...... 490,748 2003
16,589 2004
Connecticut Municipal Bond... 31,295 2002
685,391 2003
82,263 2005
Massachusetts Municipal Bond. 286,989 2003
</TABLE>
7. Concentration of Credit
The New Jersey Municipal Bond, New York Municipal Bond, Connecticut Municipal
Bond, Massachusetts Municipal Bond and Rhode Island Municipal Bond Funds invest
primarily in debt obligations issued by the State of New Jersey, the State of
New York, the State of Connecticut, the Commonwealth of Massachusetts and the
State of Rhode Island, respectively, and their respective political
subdivisions, agencies and public authorities to obtain funds for various public
purposes. The Funds, as non-diversified investment portfolios, are more
susceptible to economic and political factors adversely affecting issuers of
each respective state's specific municipal securities than are municipal bond
funds that are not concentrated in these issuers to the same extent.
8. Change of Accountants
On January 13, 1999, the Trust dismissed PricewaterhouseCoopers LLP ("PwC") as
the Funds' independent auditors by action of the Trust's Board of Trustees upon
the recommendation of a Special Committee of the Board. PwC's reports on the
Funds' financial statements for the fiscal years ended October 31, 1998 and
October 31, 1997 contained no adverse opinion or disclaimer of opinion nor were
they qualified or modified as to uncertainty, audit scope or accounting
principles. During the Funds' fiscal years ended October 31, 1998 and October
31, 1997 and the interim period commencing November 1, 1998 and ending January
13, 1999, (i) there were no disagreements with PwC on any matter of accounting
principles or practices, financial statement disclosure or auditing scope or
procedure, which disagreements, if not resolved to the satisfaction of PwC,
would have caused it to make reference to the subject matter of the
disagreements in connection with its reports on the Funds' financial statements
for such years, and (ii) there were no "reportable events" of the kind described
in Item 304(a)(1)(v) of Regulation S-K under the Securities Exchange Act of
1934, as amended.
On January 13, 1999, the Trust by action of its Board of Trustees upon the
recommendation of a Special Committee of the Board engaged Ernst & Young LLP
("E&Y") as the independent auditors to audit the Funds' financial statements for
the fiscal year ending October 31, 1999. During the Funds' fiscal years ended
October 31, 1998 and October 31, 1997 and the interim period commencing November
1, 1998 and ending January 13, 1999, neither the Trust, the Funds nor anyone on
their behalf has consulted E&Y on items which (i) concerned the application of
accounting principles to a specified transaction, either completed or proposed,
or the type of audit opinion that might be rendered on the Funds' financial
statements or (ii) concerned the subject of a disagreement (as defined in
paragraph (a)(1)(iv) of Item 304 of Regulation S-K) or reportable events (as
described in paragraph (a)(1)(v) of said Item 304).
59
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SEMIATXBND (7/1/99)
