GALAXY MONEY MARKET FUNDS
GALAXY FUNDS
SEMI-ANNUAL REPORT
APRIL 30, 2000
[COVER GRAPHICS OMITTED: ACORN,COLUMN, MITRE CAP,HANDSHAKE]
GALAXY MONEY MARKET FUND
GALAXY GOVERNMENT FUND
GALAXY U.S. TREASURY FUND
GALAXY TAX-EXEMPT FUND
GALAXY CONNECTICUT MUNICIPAL
MONEY MARKET FUND
GALAXY MASSACHUSETTS MUNICIPAL
MONEY MARKET FUND
[GRAPHIC OMITTED]
GALAXY
FUNDS
<PAGE>
CHAIRMAN'S MESSAGE
Dear Shareholder:
Enclosed is the Galaxy Money Market Funds' semi-annual report for the six
months ended April 30, 2000. The report includes a Market Overview that
discusses the economic and market conditions that may have affected your
investments during this time. Following the Market Overview are reviews of both
the Galaxy Taxable Money Market Funds and the Galaxy Tax-Exempt Money Market
Funds that describe how Fleet Investment Advisors Inc. managed the Funds'
portfolios in this environment. Financial statements and a list of portfolio
holdings for each of the Funds as of April 30, 2000 appear at the end of the
report.
Over the past six months inflation remained relatively moderate, despite a
pickup in growth. Concerned that the robust pace of growth would eventually
cause higher inflation, the Federal Reserve (the "Fed") imposed three hikes in
short-term interest rates of 25 basis points (0.25%) each. As short-term yields
reached their highest levels since 1991, money market yields rose in response.
With investors uncertain about how far interest rates would rise, stock and bond
prices became more volatile. In this climate, money market instruments added
stability to many portfolios.
Of course, market volatility, while unsettling, is part of the normal ups and
downs that occur with most investments. This is important to remember with all
the talk about the effect of securities from "new economy" industries, like
technology, on market behavior. In recent months the market has been caught up
in "momentum investing," in which the prices for technology issues have
outstripped their fundamentals. Most analysts believe, however, that there will
always be demand for investments in the "old economy" sectors represented by
industrial and retail firms. Such demand was clearly evident in the final weeks
of the reporting period, when investors shifted out of the technology sector.
During this time, many investors decided to stick with the portfolio
strategies that they had set to meet long-term investment goals. One strategy
that has served investors well over time is diversification. By using the broad
array of portfolios offered by the Galaxy Funds, you can reduce the impact of
market volatility on your returns. You may also be able to stabilize returns by
diversifying across a range of asset classes and market sectors. Because
individual classes and sectors often move in different directions, such
diversification improves the chance that some part of your portfolio will
perform well within a given period.
With many stock, bond and money market funds from which to choose, the Galaxy
Funds can provide much of the diversification you need. Following the completion
of the reorganization of the Boston 1784 Funds into the Galaxy Funds in June,
you will have even more funds from which to choose. Your financial professional
can help you select a mix of funds that suits your particular investment goals
and make sure that your asset allocations remain in place through any major
market changes.
If you have any questions about the information in this report, please
contact the Galaxy Information Center toll-free at 1-877-BUY-GALAXY
(1-877-289-4252). You can also visit one of our investment professionals located
at Fleet Bank branches.
Sincerely,
/S/ SIGNATURE DWIGHT E. VICKS, JR.
Dwight E. Vicks, Jr.
Chairman of the Board of Trustees
[START SIDEBAR]
MUTUAL FUNDS:
(BULLET) ARE NOT BANK DEPOSITS
(BULLET) ARE NOT FDIC INSURED
(BULLET) ARE NOT OBLIGATIONS OF FLEET BANK
(BULLET) ARE NOT GUARANTEED BY FLEET BANK
(BULLET) ARE SUBJECT TO INVESTMENT RISK INCLUDING POSSIBLE LOSS OF PRINCIPAL
AMOUNT INVESTED
[END SIDEBAR]
<PAGE>
MARKET OVERVIEW
MONEY MARKET OVERVIEW
BY FLEET INVESTMENT ADVISORS INC.
Money market yields rose significantly over the six months ended April 30,
2000, as economic growth remained unexpectedly strong. While still considered
low by historic standards, inflation rose during this time. To prevent a greater
increase in prices, the Fed raised short-term interest rates by 75 basis points
during the year ended December 31, 1999.
Uncertainty over when the Fed would raise rates, and how large the increases
would be, caused significant volatility in short-term yields during the
reporting period. By changing the maturities and mix of investments in the
Galaxy Money Market Funds to make the most of fluctuating yields, we helped the
Funds earn competitive returns over this time.
FED HIKES RATES TO SLOW GROWTH
At the start of November 1999, when the reporting period began, three-month
Treasury bills were yielding 5.1% and the annual rate of inflation was about
2.6%. After growing at an annualized rate of 5.5% in the third quarter of 1999,
the Gross Domestic Product ("GDP"), which measures the output of U.S. goods and
services, improved by 7.3% in the fourth quarter.
Recognizing that short-term rate hikes of 25 basis points each in June and
August of 1999 had not yet caused growth to slow, the Fed raised rates another
25 basis points on November 16. Short-term yields rose in anticipation of the
rate hike. Yields then stabilized, as investors assumed that the Fed would not
raise interest rates again in 1999 due to market concerns about possible Y2K
computer problems. By the end of 1999, three-month Treasuries were yielding
5.33%.
Economic growth remained strong in the first quarter of 2000, with an
annualized increase in the rate of GDP growth of 5.4%. With further upward
pressure on prices from tight employment and rising energy costs, the Fed
imposed two rate hikes of 25 basis points each on February 2 and March 21. With
these hikes, the Fed had boosted short-term rates by 125 basis points since June
of 1999.
Still, the economy showed few signs of slowing. Although higher interest
rates were raising costs for many companies, the "wealth effect" caused by a
strong stock market was helping to offset the economic impact of these higher
costs. With continued growth, inflation had increased to an annual rate of 3.7%
by March. As investors expected the tightening continued and short-term yields
rose. By the end of the reporting period, three-month Treasuries were yielding
5.83%.
PORTFOLIO STRATEGIES
With yields on the rise, the Galaxy Taxable Money Market Funds benefited from
a barbelled portfolio structure that emphasized both securities with very short
maturities and longer-maturity issues. Such a structure enabled the Funds to
make the most of higher-yielding investments and still remain flexible as yields
increased further. The use of floating-rate securities in the Galaxy Money
Market Fund helped us maximize rising yields.
In the Galaxy Tax-Exempt Money Market Funds we adjusted investment maturities
to take advantage of changes in yield that resulted from fluctuations in market
supply and demand. These Funds also benefited from investments in variable-rate
issues.
[START SIDEBAR]
"ECONOMIC GROWTH REMAINED STRONG IN THE FIRST QUARTER OF 2000, WITH AN
ANNUALIZED INCREASE IN THE RATE OF GDP GROWTH OF 5.4%."
[END SIDEBAR]
1
<PAGE>
PERFORMANCE AT-A-GLANCE As of April 30, 2000
RETAIL A RETAIL B TRUST
SHARES SHARES SHARES
-------- -------- ------
GALAXY MONEY MARKET FUND
7-day average yield................ 5.54% 4.83% 5.71%
30-day average yield............... 5.51% 4.80% 5.69%
GALAXY GOVERNMENT FUND
7-day average yield................ 5.34% N/A 5.50%
30-day average yield............... 5.34% N/A 5.50%
GALAXY TAX-EXEMPT FUND
7-day average yield................ 4.01% N/A 4.12%
30-day average yield............... 3.24% N/A 3.36%
GALAXY U.S. TREASURY FUND
7-day average yield................ 5.20% N/A 5.35%
30-day average yield............... 5.22% N/A 5.37%
GALAXY CONNECTICUT MUNICIPAL
MONEY MARKET FUND
7-day average yield................ 3.87% N/A N/A
30-day average yield............... 3.14% N/A N/A
GALAXY MASSACHUSETTS MUNICIPAL
MONEY MARKET FUND
7-day average yield................ 4.15% N/A N/A
30-day average yield............... 3.21% N/A N/A
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS. INVESTMENTS IN THE GALAXY
MONEY MARKET FUNDS ARE NEITHER INSURED NOR GUARANTEED BY THE FEDERAL DEPOSIT
INSURANCE CORPORATION OR ANY OTHER GOVERNMENT AGENCY. ALTHOUGH THE FUNDS SEEK
TO PRESERVE THE VALUE OF YOUR INVESTMENT AT $1.00 PER SHARE, IT IS POSSIBLE
TO LOSE MONEY BY INVESTING IN THE FUNDS. YIELDS ARE HISTORICAL AND WILL VARY
WITH MARKET PERFORMANCE.
RETAIL A SHARES ARE CURRENTLY SUBJECT TO A SHAREHOLDER SERVICING FEE OF 0.10%
OF AVERAGE DAILY NET ASSETS. RETAIL B SHARES ARE CURRENTLY SUBJECT TO A
DISTRIBUTION FEE OF 0.65% OF AVERAGE DAILY NET ASSETS AND A SHAREHOLDER
SERVICING FEE OF 0.10% OF AVERAGE DAILY NET ASSETS. (SEE NOTE 3 IN THE NOTES
TO FINANCIAL STATEMENTS.)
[START SIDEBAR]
"AS GROWTH EBBS, THE THREAT OF INFLATION SHOULD EASE, AND THE FED SHOULD PUT
FURTHER RATE HIKES ON HOLD. THIS SHOULD ALLOW MONEY MARKET YIELDS TO PEAK LATER
THIS YEAR."
[END SIDEBAR]
LOOKING AHEAD
We expect further increases in interest rates through the summer of 2000.
These rate hikes, along with reduced gains for stocks, should slow the rate of
GDP growth in the second half of 2000 to a rate of about 3%. As growth ebbs, the
threat of inflation should ease, and the Fed should put further rate hikes on
hold. This should allow money market yields to peak later this year.
In the meantime, consumer confidence remains high, employment remains strong,
and inflation could continue to rise. There could thus be further rate hikes and
higher yields in months to come.
As in the past six months, we expect to continue to take advantage of
opportunities to increase the yields of the Galaxy Money Market Funds that occur
due to near-term market fluctuations, while remaining focused on high-quality
investments with good liquidity.
2
<PAGE>
PORTFOLIO REVIEWS
GALAXY TAXABLE MONEY MARKET FUNDS
BY KAREN ARNEIL
PORTFOLIO MANAGER
As stronger than expected economic news and rising inflation concerns drove
money market yields higher in the past six months, we continued to focus on
securities with good liquidity and superior credit characteristics in the Galaxy
Taxable Money Market Funds -- which include the Galaxy Money Market Fund, the
Galaxy Government Fund, and the Galaxy U.S. Treasury Fund. Our decision to
capitalize on opportunities within individual market sectors also contributed
favorably to the good relative performance recorded by the Funds for the six
months ended April 30, 2000.
During the period, Trust Shares of the Galaxy Money Market Fund had a total
return of 2.73% and Retail A Shares of the Fund earned a total return of 2.65%.
Retail B Shares of the Fund earned a total return of 2.28% before deducting the
5.00% contingent deferred sales charge, and a total return of -2.72% after
deducting the 5.00% contingent deferred sales charge.
Over the same time, Lipper Analytical Services ("Lipper"), a mutual fund
performance tracking service, measured average total returns of 2.66% for trust
shares and 2.54% for retail shares of other taxable money market funds that
reported their results to Lipper.
For the six months ended April 30, 2000, Trust Shares of the Galaxy
Government Fund had a total return of 2.65% and Retail A Shares of the Fund had
a total return of 2.57%. Trust shares of other money market funds investing in
U.S. government issues that reported their performances to Lipper earned an
average total return of 2.66% over the same period. Retail shares of similar
funds that reported their performances to Lipper earned an average total return
of 2.52% for the period.
During this time, Trust Shares of the Galaxy U.S. Treasury Fund had a total
return of 2.48% and Retail A Shares of the Fund earned a total return of 2.41%.
These returns compared with an average total return of 2.56% for trust shares of
other money market funds investing in U.S. Treasury issues that reported their
results to Lipper. Retail shares of similar funds that reported their
performances to Lipper earned a total return of 2.39% for the period.
At the end of the period, the Galaxy Money Market Fund had an average
maturity of 51 days, the Galaxy Government Fund had an average maturity of 53
days, and the Galaxy U.S. Treasury Fund had an average maturity of 59 days.
MAXIMIZING CHANGES IN YIELD
Early in the reporting period, we increased our cash position in the Funds to
add liquidity in anticipation of a pickup in redemptions relating to concerns
about potential Y2K computer problems. After worries about Y2K began to diminish
late in 1999, we started putting this money back to work, which helped boost the
Funds' yields.
[PHOTO OMITTED]
KAREN ARNEIL HAS MANAGED THE GALAXY TAXABLE MONEY MARKET FUNDS AND THE GALAXY
TAX-EXEMPT MONEY MARKET FUNDS SINCE SEPTEMBER 1996. SHE HAS MANAGED MONEY MARKET
INVESTMENTS SINCE 1993.
GALAXY MONEY
MARKET FUND
DISTRIBUTION OF TOTAL NET
ASSETS AS OF APRIL 30, 2000
[GRAPHIC OMITTED]
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
CORPORATE NOTES AND BONDS 24%
COMMERCIAL PAPER 61%
CERTIFICATES OF DEPOSIT 16%
U.S. AGENCY OBLIGATIONS,
REPURCHASE AGREEMENTS & NET
OTHER ASSETS AND LIABILITIES (1)%
GALAXY MONEY MARKET FUND
7-DAY AVERAGE YIELD (%)
[GRAPHIC OMITTED]
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
GALAXY MONEY GALAXY MONEY GALAXY MONEY
MARKET FUND MARKET FUND MARKET FUND
TRUST RETAIL A RETAIL B
5/31/99 4.46 4.29 3.89
6/30/99 4.55 4.37 3.68
7/31/99 4.69 4.51 3.93
8/31/99 4.8 4.59 4.2
9/30/99 4.91 4.75 4.18
10/31/99 4.96 4.8 4
11/30/99 5.19 5.03 3.96
12/31/99 5.31 5.15 4.49
1/31/2000 5.42 5.25 4.54
2/29/2000 5.47 5.31 4.59
3/31/2000 5.66 5.49 4.78
4/30/2000 5.71 5.54 4.83
GALAXY GOVERNMENT FUND
DISTRIBUTION OF TOTAL NET ASSETS AS OF APRIL 30, 2000
[GRAPHIC OMITTED]
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
FEDERAL FARM CREDIT BANK 5%
FEDERAL HOME LOAN BANK 26%
REPURCHASE AGREEMENT & NET OTHER ASSETS AND LIABILITIES 11%
FEDERAL NATIONAL MORTGAGE ASSOCIATION 27%
FEDERAL HOME LOAN MORTGAGE CORPORATION 31%
3
<PAGE>
PORTFOLIO REVIEWS
Starting in late January of 2000, we employed a barbell investment strategy,
meaning that we held one-year securities as well as in those issues with less
than one month to maturity. This strategy proved beneficial to shareholders, as
growing concerns of higher inflation caused interest rates to rise. Our decision
to maintain an average-weighted maturity that was slightly longer than that of
our peer group throughout much of the period also proved rewarding.
A strategy that contributed positively to the performance of the Galaxy Money
Market Fund was our decision to increase the Fund's investments in floating-rate
securities, including high-quality corporate floating rate securities. As
interest rates rose, the rates on these securities also increased, raising the
level of income paid to shareholders.
As demand for Treasuries began to ease, and the yield curve flattened, we
gave greater emphasis to shorter-term issues in the Galaxy U.S. Treasury Fund.
Given the small spread between the yields of government issues with different
maturities, we emphasized shorter-term investments in both the Galaxy U.S.
Treasury Fund and the Galaxy Government Fund.
In late March and early April, we purchased cash-management bills due to
their attractive yields for the Galaxy U.S. Treasury Fund. This strategy, which
has worked well for shareholders in the past, helped returns again in the final
months of the period.
As the period closed, we locked in high yields with investments in one-year
paper. We believe this strategy will also prove rewarding should the economy
start to slow later in the year, causing interest rates to come down.
SHORT-TERM YIELDS LIKELY TO PEAK
Expecting growth to be moderate in the second half of 2000, and money market
yields to peak in coming months, we plan to maintain a slightly
longer-than-average maturity and to emphasize high-quality, short-term
securities that, in our judgment, offer both attractive yields and are liquid.
GALAXY GOVERNMENT FUND
7-DAY AVERAGE YIELD (%)
[GRAPHIC OMITTED]
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
GALAXY GALAXY
GOVERNMENT GOVERNMENT
FUND FUND
TRUST RETAIL A
5/31/99 4.34 4.16
6/30/99 4.38 4.2
7/31/99 4.54 4.35
8/31/99 4.7 4.56
9/30/99 4.65 4.51
10/31/99 4.88 4.75
11/30/99 5.09 4.96
12/31/99 5.09 4.92
1/31/2000 5.25 5.1
2/29/2000 5.34 5.18
3/31/2000 5.46 5.31
4/30/2000 5.5 5.34
GALAXY U.S. TREASURY FUND
DISTRIBUTION OF TOTAL NET ASSETS AS OF APRIL 30, 2000
[GRAPHIC OMITTED]
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
FEDERAL HOME LOAN BANK 29%
US TREASURY NOTES 24%
US TREASURY BILLS 43%
FEDERAL FARM CREDIT BANK & NET OTHER ASSETS AND LIABILITIES 4%
GALAXY U.S. TREASURY FUND
7-DAY AVERAGE YIELD (%)
[GRAPHIC OMITTED]
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
GALAXY U.S. GALAXY U.S.
TREASURY TREASURY
FUND FUND
TRUST RETAIL A
5/31/99 4.1 3.94
6/30/99 4.15 3.99
7/31/99 4.26 4.1
8/31/99 4.39 4.24
9/30/99 4.4 4.25
10/31/99 4.43 4.28
11/30/99 4.63 4.48
12/31/99 4.69 4.54
1/31/2000 4.91 4.76
2/29/2000 5.02 4.87
3/31/2000 5.25 5.1
4/30/2000 5.35 5.2
4
<PAGE>
PORTFOLIO REVIEWS
GALAXY TAX-EXEMPT
MONEY MARKET FUNDS
BY KAREN ARNEIL
PORTFOLIO MANAGER
As the yields on tax-exempt money market securities rose in an environment
punctuated by high volatility, we used the market's fluctuations to maximize
yield opportunities in the Galaxy Tax-Exempt Money Market Funds -- which include
the Galaxy Tax-Exempt Fund, the Galaxy Connecticut Municipal Money Market Fund
and the Galaxy Massachusetts Municipal Money Market Fund. These strategies
helped the Funds generate investment results that compared favorably with other
tax-exempt money market portfolios.
For the six-month reporting period ended April 30, 2000, Trust and Retail A
Shares of the Galaxy Tax-Exempt Fund had total returns of 1.54% and 1.47%,
respectively. Over the same time, trust and retail shares of other tax-exempt
money market funds reporting their performances to Lipper earned average total
returns of 1.68% and 1.54%, respectively.
Retail A Shares of the Galaxy Connecticut Municipal Money Market Fund had a
total return of 1.44%, versus 1.40% for the retail shares of other Connecticut
tax-exempt money market funds tracked by Lipper. Retail A Shares of the Galaxy
Massachusetts Municipal Money Market Fund had a total return of 1.46%, versus
1.49% for the retail shares of other Massachusetts tax-exempt money market funds
reporting their performances to Lipper.
As of April 30, 2000, the average maturity of the Galaxy Tax-Exempt Fund was
39 days, and the average maturities of the Galaxy Connecticut and Galaxy
Massachusetts Municipal Money Market Funds were 43 days and 27 days,
respectively.
ANTICIPATING CHANGES IN SUPPLY AND DEMAND
When the period began, investors were generally concerned about a slowdown in
economic activity due to potential Y2K computer concerns. The uncertainty
surrounding this once-in-a-lifetime event made for uneventful activity in the
tax-exempt arena. Demand for short-term tax-exempt securities was strong due to
the fact that investors wanted to keep cash available for any eventualities that
might arise.
After Y2K came and went with no significant problems, interest rates began
moving higher as investors focused on the strength of the economy. However,
demand for tax-exempt securities at the short-end of the yield curve increased,
which prevented tax-exempt yields from mirroring their taxable counterparts.
GALAXY
TAX-EXEMPT FUND
DISTRIBUTION OF TOTAL NET ASSETS AS OF APRIL 30, 2000
[GRAPHIC OMITTED]
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
EAST 15%
PACIFIC 2%
SOUTH 58%
MOUNTAIN 15%
NORTH CENTRAL 14%
OTHER TERRITORIES, CASH EQUIVALENTS & NET OTHER ASSETS AND LIABILITES (4)%
GALAXY TAX-EXEMPT FUND
7-DAY AVERAGE YIELD (%)
[GRAPHIC OMITTED]
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
GALAXY GALAXY
TAX-EXEMPT TAX-EXEMPT
FUND FUND
TRUST RETAIL A
5/31/99 2.7 2.55
6/30/99 3.2 3.05
7/31/99 2.64 2.5
8/31/99 2.68 2.53
9/30/99 3.21 3.08
10/31/99 2.9 2.76
11/30/99 3.16 3.02
12/31/99 3.84 3.71
1/31/2000 2.83 2.69
2/29/2000 3.2 3.07
3/31/2000 3.2 3.07
4/30/2000 4.12 4.01
GALAXY CONNECTICUT MUNICIPAL
MONEY MARKET FUND
7-DAY AVERAGE YIELD (%)
[GRAPHIC OMITTED]
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
5/31/99 2.51
6/30/99 2.94
7/31/99 2.46
8/31/99 2.51
9/30/99 2.92
10/31/99 2.71
11/30/99 3
12/31/2000 3.66
1/31/2000 2.68
2/29/2000 2.94
3/31/2000 3
4/30/2000 3.87
5
<PAGE>
PORTFOLIO REVIEWS
Although short-term yields continued to rise as the period progressed,
tax-exempt money market securities faced seasonal downward pressure on yields
due to increased demand. Against this backdrop, we boosted our exposure to
tax-exempt notes, which enhanced the level of income paid to shareholders. In
anticipation of increasing liquidations during the April tax season, we raised
cash investments in the Funds. Once yields started rising, as they typically do
during tax season, we took advantage of the higher rates.
Throughout the reporting period, the Funds benefited from investments in
variable-rate securities. Because these securities adjust their rates
periodically, they helped increase the Funds' yields as rates rose especially
during tax season.
REDUCED SUPPLIES
Many state and local governments are now starting new fiscal years, which
usually increases the supply of new tax-exempt securities. We believe this year
will be different, however. Thanks to strong tax revenues, many state and local
municipalities do not have the same financing needs that they have had in recent
years.
Usually when a flood of new issues comes to market, yields improve due to the
increase in supply. When this happens, we usually lock in the higher yields with
longer-maturity investments. We expect to continue to lock in yields on
securities that we find attractive this year, but for a different reason. We
believe that the economy will slow enough in the second half of the year, making
higher-yield securities more valuable to investors. As always, we plan to
continue to maintain our diversified investment strategy and focus only on
securities that meet our high criteria for investment.
GALAXY CONNECTICUT MUNICIPAL MONEY MARKET FUND
DISTRIBUTION OF TOTAL NET ASSETS AS OF APRIL 30, 2000
[GRAPHIC OMITTED]
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
CONNECTICUT 64%
NORTH CENTRAL 2%
SOUTH 14%
EAST 2%
PACIFIC 4%
MOUNTAIN,OTHER TERRITORIES, CASH EQUIVALENT & NET OTHER ASSETS
AND LIABILITIES 14%
GALAXY MASSACHUSETTS MUNICIPAL
MONEY MARKET FUND
DISTRIBUTION OF TOTAL NET ASSETS AS OF APRIL 30, 2000
[GRAPHIC OMITTED]
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
MASSACHUSETTS 67%
EAST 7%
SOUTH 14%
OTHER TERRITORIES CASH EQUIVALENT & NET OTHER ASSETS
AND LIABILITIES 2%
PACIFIC 4%
MOUNTAIN 3%
NORTH CENTRAL 3%
GALAXY MASSACHUSETTS MUNICIPAL MONEY MARKET FUND
7-DAY AVERAGE YIELD (%)
[GRAPHIC OMITTED]
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
5/31/99 2.54
6/30/99 2.96
7/31/99 2.44
8/31/99 2.5
9/30/99 2.93
10/31/99 2.73
11/30/99 3
12/31/99 3.81
1/31/2000 2.69
2/29/2000 3.02
3/31/2000 3.01
4/30/2000 4.15
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 EXCLUDE THE DEDUCTION OF ANY CONTINGENT DEFERRED SALES CHARGE
UNLESS OTHERWISE INDICATED. RETAIL B SHARES OF THE GALAXY MONEY MARKET FUND ARE
SUBJECT TO A 5.00% CONTINGENT DEFERRED SALES CHARGE IF SHARES ARE REDEEMED
WITHIN THE FIRST YEAR AFTER PURCHASE. 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. THERE CAN BE NO ASSURANCE THAT THE FUNDS WILL BE ABLE TO
MAINTAIN A STABLE NET ASSET VALUE OF $1.00 PER SHARE.
6
<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 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 services. 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 YOUR FUND PROSPECTUS. SHARES OF THE FUNDS ARE DISTRIBUTED
THROUGH PROVIDENT DISTRIBUTORS, INC., MEMBER NASD AND SIPC.
[START SIDEBAR]
"A WELL-BALANCED ASSET ALLOCATION PLAN MAY HELP TO CONTROL YOUR RISK WHILE
PURSUING YOUR GOALS."
[END SIDEBAR]
7
<PAGE>
SHAREHOLDER INFORMATION
[START 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
Jylanne Dunne
Vice President and
Assistant Treasurer
William Greilich
VICE PRESIDENT
W. Bruce
McConnel, Esq.
SECRETARY
INVESTMENT ADVISOR
Fleet Investment
Advisors Inc.
75 State Street
Boston, MA 02109
DISTRIBUTOR
Provident Distributors, Inc.
3200 Horizon Drive
King of Prussia
Pennsylvania 19406
ADMINISTRATOR
PFPC Inc.
4400 Computer Drive
Westborough,
Massachusetts 01581-5108
AUDITOR
Ernst & Young LLP
200 Clarendon Street
Boston, MA 02116
LEGAL COUNCEL
Drinker Biddle & Reath LLP
One Logan Square
18th and Cherry Streets
Philadelphia, PA 19103-6996
[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 Provident 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, FLEETBOSTON FINANCIAL CORPORATION 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. THERE IS NO ASSURANCE THAT THE FUNDS WILL BE
ABLE TO MAINTAIN A STABLE NET ASSET VALUE OF $1.00 PER SHARE.
[GRAPHIC OMITTED]
This report was printed on recycled paper.
8
<PAGE>
MONEY MARKET FUND
PORTFOLIO OF INVESTMENTS
APRIL 30, 2000 (UNAUDITED)
PAR VALUE VALUE
--------- -----
COMMERCIAL PAPER (A) - 60.61%
FINANCE - 35.12%
$150,000,000 ABB Treasury Center USA
6.05%, 05/01/00 (C).............. $ 150,000,000
50,000,000 American Express Credit Corp.
6.02%, 05/15/00.................. 49,882,944
100,000,000 Associates Corp. of North America
6.04%, 05/01/00.................. 100,000,000
50,000,000 Associates Corp. of North America
6.01%, 05/09/00.................. 49,933,222
65,300,000 BellSouth Capital Funding Corp.
6.00%, 05/01/00 (C).............. 65,300,000
53,000,000 BellSouth Capital Funding Corp.
6.00%, 05/16/00 (C).............. 52,867,500
50,000,000 BMW U.S. Capital Corp.
6.08%, 05/24/00.................. 49,805,778
50,000,000 CDC Commercial Paper Corp.
5.90%, 05/05/00 (C).............. 49,967,222
50,000,000 CDC Commercial Paper Corp.
6.02%, 05/15/00 (C).............. 49,882,945
50,000,000 CDC Commercial Paper Corp.
6.05%, 05/22/00 (C).............. 49,823,542
50,000,000 Ford Motor Credit Co.
6.00%, 05/17/00.................. 49,866,667
50,000,000 Ford Motor Credit Co.
6.00%, 05/19/00.................. 49,850,000
50,000,000 General Electric Capital Corp.
6.00%, 05/05/00.................. 49,966,667
50,000,000 General Electric Capital Corp.
5.99%, 06/01/00.................. 49,742,097
50,000,000 General Motors Acceptance Corp.
6.03%, 05/08/00.................. 49,941,375
50,000,000 General Motors Acceptance Corp.
6.00%, 05/22/00.................. 49,825,000
100,000,000 IBM Credit Corp.
5.96%, 05/16/00.................. 99,751,667
50,000,000 International Lease Finance Corp.
6.00%, 05/09/00.................. 49,933,333
50,000,000 International Lease Finance Corp.
6.00%, 05/16/00.................. 49,875,000
50,000,000 International Lease Finance Corp.
6.00%, 05/19/00.................. 49,850,000
100,000,000 Morgan (J.P.) & Co.
5.90%, 05/08/00.................. 99,885,278
30,000,000 National Rural Utilities Cooperative
Finance Corp.
6.00%, 05/18/00.................. 29,915,000
150,000,000 UBS Finance (DE) LLC
6.04%, 05/01/00.................. 150,000,000
33,000,000 USAA Capital Corp.
6.03%, 05/12/00.................. 32,939,198
39,261,000 USAA Capital Corp.
5.97%, 05/15/00.................. 39,169,849
-------------
1,567,974,284
-------------
PAR VALUE VALUE
--------- -----
CONSUMER STAPLES - 20.58%
$ 50,000,000 Coca Cola Co.
6.01%, 05/09/00.................. $ 49,933,222
50,000,000 Coca Cola Co.
5.95%, 05/12/00.................. 49,909,097
50,000,000 Coca Cola Co.
6.02%, 05/26/00.................. 49,790,972
38,525,000 Colgate Palmolive Co.
6.01%, 05/18/00 (C).............. 38,415,665
50,000,000 DaimlerChrysler NA Holding
5.92%, 05/10/00.................. 49,926,000
100,000,000 DaimlerChrysler NA Holding
6.01%, 05/17/00.................. 99,732,889
36,500,000 Heinz (H.J.) Co.
6.03%, 05/15/00.................. 36,414,408
36,350,000 Kimberly-Clark Corp.
6.00%, 05/12/00 (C).............. 36,283,358
85,000,000 Koch Industries, Inc.
6.03%, 05/01/00 (C).............. 85,000,000
50,000,000 Merck & Co., Inc.
6.00%, 05/19/00.................. 49,850,000
50,000,000 Procter & Gamble Co.
6.02%, 05/09/00.................. 49,933,111
50,000,000 United Parcel Service of America, Inc.
6.00%, 05/11/00.................. 49,916,667
100,190,000 Wal-Mart Stores, Inc.
6.00%, 05/16/00 (C).............. 99,939,608
50,000,000 Wal-Mart Stores, Inc.
6.00%, 05/18/00 (C).............. 49,858,333
74,000,000 Warner-Lambert Co.
6.00%, 05/11/00 (C).............. 73,876,667
50,000,000 Warner-Lambert Co.
6.00%, 05/17/00 (C).............. 49,866,667
-------------
918,646,664
-------------
TECHNOLOGY - 1.12%
50,000,000 Pitney Bowes, Inc.
6.00%, 05/10/00.................. 49,925,000
-------------
BASIC MATERIALS - 1.12%
50,000,000 duPont (E.I.) deNemours & Co.
6.01%, 05/10/00.................. 49,924,875
-------------
UTILITIES (C) - 1.03%
46,000,000 SBC Communications, Inc.
5.90%, 05/04/00.................. 45,977,383
-------------
SEE NOTES TO FINANCIAL STATEMENTS.
9
<PAGE>
MONEY MARKET FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
APRIL 30, 2000 (UNAUDITED)
PAR VALUE VALUE
--------- -----
CONSUMER CYLICAL (C) - 0.86%
$38,500,000 McDonald's Corp.
6.00%, 05/08/00.................. $ 38,455,083
-------------
ENERGY - 0.78%
35,000,000 Exxon Asset Management Co.
6.00%, 05/04/00.................. 34,982,500
-------------
TOTAL COMMERCIAL PAPER........... 2,705,885,789
-------------
(Cost $2,705,885,789)
CORPORATE NOTES AND BONDS - 24.07%
BANKING - 15.46%
68,000,000 Allfirst Bank
6.31%, 10/26/00 (B).............. 67,979,227
50,000,000 American Express Centurion Bank,
Bank Note
6.14%, 03/30/01 (B).............. 50,000,000
48,000,000 Bank of New York
6.52%, 01/22/01.................. 47,981,721
50,000,000 Bank One N.A., Bank Note
6.16%, 10/16/00.................. 49,991,222
50,000,000 Citicorp, Inc., MTN
6.10%, 04/04/01 (B).............. 50,000,000
50,000,000 Comerica Bank, Bank Note
6.15%, 09/01/00 (B).............. 49,988,192
12,500,000 Comerica Bank, Bank Note
6.20%, 09/25/00 (B).............. 12,499,297
10,000,000 Comerica Bank, Bank Note
6.05%, 02/14/01 (B).............. 9,996,356
50,000,000 Comerica Bank, Bank Note
6.04%, 03/14/01 (B).............. 49,978,644
12,500,000 First National Bank of Maryland
6.34%, 12/04/00 (B).............. 12,515,864
50,000,000 Huntington National Bank, Bank Note
6.05%, 12/13/00 (B).............. 49,972,213
30,750,000 Huntington National Bank, Bank Note
6.38%, 01/12/01 (B).............. 30,779,271
37,500,000 Key Bank N.A., Bank Note
6.09%, 06/26/00 (B).............. 37,496,607
37,000,000 Key Bank N.A., Bank Note
6.33%, 11/02/00 (B).............. 37,034,291
40,000,000 Key Bank N.A., Bank Note
6.50%, 01/29/01.................. 39,982,942
44,000,000 M & I Bank Northeast
6.36%, 10/26/00.................. 44,000,000
50,000,000 Rabobank Nederland
6.66%, 03/08/01.................. 49,979,777
-------------
690,175,624
-------------
PAR VALUE VALUE
--------- -----
FINANCE - 5.25%
$36,000,000 IBM Credit Corp., MTN
5.90%, 08/07/00.................. $ 35,996,059
60,000,000 National Rural Utilities
Cooperative, MTN
6.21%, 06/26/00 (B).............. 59,999,161
38,500,000 National Rural Utilities
Cooperative, MTN
6.13%, 08/02/00 (B).............. 38,497,952
100,000,000 Texaco Capital, Inc., MTN
5.94%, 05/03/00 (B).............. 99,999,486
-------------
234,492,658
-------------
UTILITIES (B) - 1.68%
75,000,000 AT&T Corp.
6.24%, 07/13/00 (D).............. 74,994,000
-------------
CONSUMER STAPLES - 1.68%
25,000,000 Anheuser-Busch Cos.,
6.03%, 06/16/00 (B) (D).......... 24,996,595
50,000,000 Sara Lee Corp., MTN
6.68%, 02/14/01.................. 49,977,496
-------------
74,974,091
-------------
TOTAL CORPORATE NOTES AND BONDS . 1,074,636,373
-------------
(Cost $1,074,636,373)
CERTIFICATES OF DEPOSIT - 16.47%
34,000,000 Allfirst Bank
6.07%, 02/09/01 (B).............. 33,987,088
50,000,000 Bank of Nova Scotia
6.70%, 02/12/01.................. 49,979,488
100,000,000 Barclays Bank Plc
6.09%, 05/26/00.................. 100,000,000
50,000,000 Bayerische Landesbank New York
6.03%, 12/15/00 (B).............. 49,968,852
100,000,000 Bayerische Landesbank New York
6.06%, 12/15/00 (B).............. 99,953,279
50,000,000 Canadian Imperial Bank, Yankee
5.25%, 10/18/00.................. 49,999,454
48,000,000 Canadian Imperial Bank
6.88%, 05/02/01.................. 47,990,904
88,500,000 First Union National Bank
6.13%, 11/24/00 (B).............. 88,490,110
15,000,000 Key Bank N.A.
5.71%, 07/12/00.................. 14,998,725
50,000,000 Rabobank Nederland
6.69%, 02/28/01.................. 49,980,309
50,000,000 Royal Bank of Canada, Yankee
6.52%, 01/18/01.................. 49,982,945
50,000,000 Royal Bank of Canada
6.03%, 03/14/01 (B).............. 49,976,507
50,000,000 SunTrust Bank
6.78%, 04/18/01.................. 49,986,281
-------------
TOTAL CERTIFICATES OF DEPOSIT ... 735,293,942
-------------
(Cost $735,293,942)
SEE NOTES TO FINANCIAL STATEMENTS.
10
<PAGE>
MONEY MARKET FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
APRIL 30, 2000 (UNAUDITED)
PAR VALUE VALUE
--------- -----
U.S. AGENCY OBLIGATION - 0.29%
FEDERAL HOME LOAN BANK - 0.29%
$13,000,000 5.92%, 10/13/00.................. $ 12,994,608
--------------
TOTAL U.S. AGENCY OBLIGATION .... 12,994,608
--------------
(Cost $12,994,608)
REPURCHASE AGREEMENT - 0.31%
13,669,000 Repurchase Agreement with:
Merrill Lynch
5.70%, Due 05/01/2000, dated 04/28/2000
Repurchase Price $13,675,493
(Collateralized by U.S. Treasury
Note 7.50% Due 11/15/01,
Total Par $13,320,000,
Market Value $13,943,473)........ 13,669,000
--------------
TOTAL REPURCHASE AGREEMENT ...... 13,669,000
--------------
(Cost $13,669,000)
TOTAL INVESTMENTS - 101.75%...................... 4,542,479,712
--------------
(Cost $4,542,479,712)*
NET OTHER ASSETS AND LIABILITIES - (1.75)%....... (78,263,618)
--------------
NET ASSETS - 100.00%............................ $4,464,216,094
==============
--------------------------------------------
* Aggregate cost for federal tax purposes.
(A) Discount yield at time of purchase.
(B) Interest is reset at various time intervals. The interest rate shown
reflects the rate in effect at April 30, 2000.
(C) Securities exempt from registration under section 4(2) of the Securities
Act of 1933, as amended. These securities may only be resold in an exempt
transaction to qualified institutional buyers. At April 30, 2000, these
securities amounted to $935,513,973 or 20.96% of net assets.
(D) Securities exempt from registration pursuant to Rule 144A under the
Securities Act of 1933, as amended. These securities may only be resold
in an exempt transaction to qualified institutional buyers. At April 30,
2000, these securities amounted to $99,990,595 or 2.23% of net assets.
MTN Medium Term Note
SEE NOTES TO FINANCIAL STATEMENTS.
11
<PAGE>
GOVERNMENT FUND
PORTFOLIO OF INVESTMENTS
APRIL 30, 2000 (UNAUDITED)
PAR VALUE VALUE
--------- -----
U.S. GOVERNMENT AND AGENCY OBLIGATIONS - 89.14%
FEDERAL HOME LOAN MORTGAGE CORPORATION - 30.81%
$ 8,300,000 5.88%, 05/02/00 (A).............. $ 8,298,644
40,000,000 5.88%, 05/09/00 (A).............. 39,947,733
43,000,000 5.81%, 05/11/00 (A).............. 42,930,603
10,000,000 5.94%, 05/18/00 (B).............. 9,999,539
90,000,000 5.78%, 05/25/00 (A).............. 89,649,867
40,000,000 5.94%, 12/20/00 (B), MTN......... 39,968,169
20,000,000 6.35%, 01/05/01, MTN............. 19,972,007
25,000,000 6.23%, 04/26/01 (A).............. 23,442,499
-------------
274,209,061
-------------
FEDERAL NATIONAL MORTGAGE ASSOCIATION - 27.22%
20,000,000 5.00%, 05/04/00, MTN............. 19,998,134
20,000,000 5.12%, 05/12/00, MTN............. 19,993,830
40,000,000 5.90%, 05/16/00 (A).............. 39,901,667
40,000,000 5.89%, 05/23/00 (A).............. 39,856,022
40,000,000 6.08%, 07/20/00 (A).............. 39,459,556
18,000,000 5.97%, 07/26/00 (B), MTN......... 17,997,357
25,000,000 5.92%, 08/04/00 (B), MTN......... 24,996,107
40,000,000 5.93%, 12/08/00 (B), MTN......... 39,976,330
-------------
242,179,003
-------------
FEDERAL HOME LOAN BANK - 26.08%
13,000,000 5.88%, 05/03/00 (A).............. 12,995,753
50,000,000 5.90%, 05/22/00 (A).............. 49,827,917
30,500,000 5.20%, 05/26/00.................. 30,499,229
50,000,000 5.85%, 05/26/00 (A).............. 49,797,049
15,000,000 6.00%, 07/28/00 (B).............. 14,997,836
30,000,000 5.71%, 08/09/00.................. 29,994,836
15,000,000 6.13%, 10/04/00 (B).............. 14,995,603
19,000,000 5.92%, 10/13/00.................. 18,992,120
10,000,000 6.45%, 03/16/01.................. 9,990,649
-------------
232,090,992
-------------
FEDERAL FARM CREDIT BANK - 5.03%
25,000,000 5.97%, 09/01/00 (B).............. 24,997,480
20,000,000 5.13%, 04/02/01.................. 19,757,828
-------------
44,755,308
-------------
TOTAL U.S. GOVERNMENT AND AGENCY
OBLIGATIONS ..................... 793,234,364
-------------
(Cost $793,234,364)
PAR VALUE VALUE
--------- -----
REPURCHASE AGREEMENT - 11.08%
$98,609,000 Repurchase Agreement with:
Merrill Lynch
5.70%, Due 05/01/2000, dated 04/28/2000,
Repurchase Price $98,655,839
(Collateralized by U.S. Treasury
Notes & Bonds 7.50% - 14.00%,
Due 11/15/01 through 11/15/11,
Total Par $74,703,000,
Market Value $100,588,383)....... $ 98,609,000
-------------
TOTAL REPURCHASE AGREEMENT ...... 98,609,000
-------------
(Cost $98,609,000)
TOTAL INVESTMENTS - 100.22%...................... 891,843,364
-------------
(Cost $891,843,364)*
NET OTHER ASSETS AND LIABILITIES - (0.22)%....... (1,939,059)
-------------
NET ASSETS - 100.00%............................. $ 889,904,305
=============
----------------------------------------------
* Aggregated cost for federal tax purposes.
(A) Discount yield at time of purchase.
(B) Interest is reset at various time intervals. The interest rate
shown reflects the rate in effect at April 30, 2000.
MTN Medium Term Note
SEE NOTES TO FINANCIAL STATEMENTS.
12
<PAGE>
TAX-EXEMPT FUND
PORTFOLIO OF INVESTMENTS
APRIL 30, 2000 (UNAUDITED)
PAR VALUE VALUE
--------- -----
MUNICIPAL SECURITIES - 107.40%
ALABAMA - 3.14%
$ 4,300,000 Chatom County, IDB,
National Rural Utilities, CFC
4.00%, 07/06/00.................. $ 4,300,000
11,500,000 Mobile IDB Dock & Wharf Revenue,
Holnam Inc. Project, Series A
5.00%, 06/01/32 (A)
LOC: Bayerische Landesbank GZ.... 11,500,000
1,500,000 North Alabama, PCR,
Environmental Improvement Authority,
Reynolds Metals
6.00%, 12/01/00 (A)
LOC: Bank of Nova Scotia......... 1,500,000
1,000,000 Phoenix County, IDB,
Environmental Improvements
Georgia Kraft Project
5.80%, 12/01/15 (A)
LOC: Deutsche Bank AG............ 1,000,000
-------------
18,300,000
-------------
ALASKA - 2.91%
6,500,000 Valdez Marine Terminal Revenue
Exxon Pipeline Co. Project,
Series A
5.85%, 12/01/33 (A).............. 6,500,000
8,600,000 Valdez Marine Terminal Revenue
Exxon Pipeline Co. Project,
Series B
5.85%, 12/01/33 (A).............. 8,600,000
1,850,000 Valdez Marine Terminal Revenue
Exxon Pipeline Co. Project,
Series C
5.85%, 12/01/33 (A).............. 1,850,000
-------------
16,950,000
-------------
ARIZONA - 1.20%
5,000,000 Maricopa County,
PCR, Arizona Public Service Co.
Series A
5.85%, 05/01/29 (A)
LOC: Morgan Guaranty Trust....... 5,000,000
2,000,000 Maricopa County,
PCR, Arizona Public Service Co.
Series C
5.80%, 05/01/29 (A)
LOC: Toronto Dominion Bank....... 2,000,000
-------------
7,000,000
-------------
PAR VALUE VALUE
--------- -----
ARKANSAS - 1.63%
$7,300,000 Crossett, PCR,
Georgia Pacific Corp. Project
5.00%, 10/01/07 (A)
LOC: Wachovia Bank, N.A.......... $ 7,300,000
2,200,000 Pulaski County, PCR,
Minnesota Mining & Manufacturing
4.70%, 08/01/22 (A).............. 2,200,000
-------------
9,500,000
-------------
CALIFORNIA - 1.12%
2,700,000 Los Angeles Regional
Airports Improvement Corp.
American Airlines, Inc., Series B,
LA International Airport
6.00%, 12/01/24 (A)
LOC: Wachovia Bank, N.A.......... 2,700,000
3,800,000 Los Angeles Regional
Airports Improvement Corp.
American Airlines, Inc., Series E, LA
International Airport
6.00%, 12/01/24 (A)
LOC: Wachovia Bank, N.A. ........ 3,800,000
-------------
6,500,000
-------------
COLORADO - 1.18%
3,815,000 Colorado State HFA,
Boulder Community Hospital Project
Series B
5.00%, 10/01/14 (A)
Insured: MBIA,
SPA: Rabobank Netherland NV ..... 3,815,000
3,070,000 Colorado State HFA,
Boulder Community Hospital Project
Series C
5.00%, 10/01/14 (A)
Insured: MBIA,
SPA: Rabobank Netherland NV...... 3,070,000
-------------
6,885,000
-------------
FLORIDA - 3.09%
10,000,000 Putnam County Development
Authority, PCR, Seminole Electric
Cooperative, Series D
3.80%, 12/15/09 (A)
Guaranteed: National Rural
Utilities CFC.................... 10,000,000
8,000,000 West Orange Healthcare
District Revenue, Series B
5.00%, 02/01/22 (A)
LOC: Suntrust Bank............... 8,000,000
-------------
18,000,000
-------------
SEE NOTES TO FINANCIAL STATEMENTS.
13
<PAGE>
Tax-Exempt Fund
Portfolio of Investments (continued)
April 30, 2000 (unaudited)
PAR VALUE VALUE
--------- -----
GEORGIA - 1.76%
$8,360,000 Burke County Development
Authority, PCR, Oglethorpe
Power Corp., Series A
5.05%, 01/01/16 (A)
Insured: FGIC,
SPA: Canadian Imperial
Bank of Commerce................. $ 8,360,000
1,900,000 Municipal Electric Authority,
Project One, Series D
5.05%, 01/01/22 (A)
LOC: ABN-AMRO Bank N.V. ......... 1,900,000
-------------
10,260,000
-------------
ILLINOIS - 3.91%
6,100,000 Chicago O'Hare International Airport
American Airlines, Series C
5.80%, 12/01/17 (A)
LOC: Royal Bank of Canada........ 6,100,000
5,000,000 Illinois Development Finance
Authority, PCR, Illinois Power Co.
Project, Series A
5.05%, 11/01/28 (A)
LOC: ABN-AMRO Bank N.V. ......... 5,000,000
9,800,000 Illinois Educational Facilities
Authority Revenue
3.80%, 06/14/00
LOC: Northern Trust Co........... 9,800,000
1,900,000 Northbrook, IDR,
Euromarket Designs, Inc.
5.05%, 07/01/02 (A)
LOC: Harris Trust & Savings Bank. 1,900,000
-------------
22,800,000
-------------
INDIANA - 3.21%
5,205,000 Fort Wayne Hospital Authority
Parkview Memorial Hospital,
Series B
5.00%, 01/01/16 (A)
LOC: Bank of America NT & SA..... 5,205,000
3,840,000 Fort Wayne Hospital Authority
Parkview Memorial Hospital,
Series C
5.00%, 01/01/16 (A)
LOC: Bank of America NT & SA..... 3,840,000
9,700,000 Princeton Industrial, PCR,
PSI Energy, Inc. Project
5.85%, 03/01/19 (A)
LOC: Canadian Imperial
Bank of Commerce................. 9,700,000
-------------
18,745,000
-------------
PAR VALUE VALUE
--------- -----
IOWA - 0.69%
$4,000,000 Iowa Finance Authority Revenue,
Wheaton Franciscan, Series A
5.00%, 08/15/12 (A)
Insured: MBIA,
SPA: Toronto-Dominion Bank....... $ 4,000,000
-------------
KENTUCKY - 4.09%
8,800,000 Ashland, PCR,
Ashland Oil, Inc. Project
4.90%, 04/01/09 (A)
LOC: SunTrust Bank............... 8,800,000
15,000,000 Kentucky Asset Liability Commission,
General Fund Revenue, TRAN,
Series A
4.25%, 06/28/00.................. 15,020,108
-------------
23,820,108
-------------
LOUISIANA - 8.68%
9,800,000 Ascension Parish, PCR,
Shell Oil Co.
4.90%, 05/01/26 (A).............. 9,800,000
4,000,000 East Baton Rouge Parish,
PCR, Exxon Project
5.80%, 03/01/22 (A).............. 4,000,000
1,800,000 Lake Charles Harbor &
Terminal District
Port Facilities Revenue
Citgo Petroleum Corp.
5.05%, 08/01/07 (A)
LOC: Westdeutsche Landesbank GZ.. 1,800,000
1,000,000 Louisiana Public Facilities Authority,
PCR, Ciba-Geigy Corp. Project
5.00%, 12/01/04 (A)
LOC: UBS AG...................... 1,000,000
2,100,000 Louisiana State Offshore Terminal
Authority, Deepwater Port Revenue
Loop, Inc., 1st Stage
5.90%, 09/01/06 (A)
LOC: UBS AG...................... 2,100,000
7,600,000 Louisiana State Offshore Terminal
Authority, Deepwater Port Revenue
Loop, Inc., 1st Stage A
5.85%, 09/01/08 (A)
LOC: UBS AG...................... 7,600,000
8,800,000 St. Charles Parish, PCR,
Shell Oil Co. Project
4.90%, 06/01/05 (A).............. 8,800,000
15,500,000 St. James Parish, PCR,
Texaco Project, Series A
4.25%, 10/17/00.................. 15,500,000
-------------
50,600,000
-------------
SEE NOTES TO FINANCIAL STATEMENTS.
14
<PAGE>
TAX-EXEMPT FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
APRIL 30, 2000 (UNAUDITED)
PAR VALUE VALUE
--------- -----
MAINE - 1.89%
$11,000,000 Maine Finance Authority,
Jackson Laboratory Issue
5.05%, 12/01/30 (A)
LOC: Keybank N.A. ............... $ 11,000,000
-------------
MARYLAND - 1.41%
8,185,000 Maryland State, GO
5.00%, 03/01/01.................. 8,242,817
-------------
MASSACHUSETTS - 1.87%
8,000,000 Massachusetts State HEFA,
Harvard University, Series R
5.00%, 11/01/49 (A).............. 8,000,000
2,900,000 Massachusetts State Housing Finance
Agency, Multi-Family, Series A
4.95%, 12/01/25 (A)
LOC: GNMA,
SPA: Republic National
Bank of New York................. 2,900,000
-------------
10,900,000
-------------
MICHIGAN - 3.78%
1,200,000 Cornell Township Economic
Development Corp.,
Environmental Improvement Revenue,
Mead Escabana Paper Co.
5.95%, 11/01/16 (A)
LOC: Bank of America NT & SA..... 1,200,000
6,000,000 Michigan Municipal Bond Authority,
Series A-1
4.75%, 04/26/01.................. 6,028,365
14,835,000 Michigan State University
Revenue, Series A-2
4.90%, 08/15/22 (A).............. 14,835,000
-------------
22,063,365
-------------
MINNESOTA - 0.86%
5,000,000 Minneapolis, GO
4.50%, 12/01/00.................. 5,015,512
-------------
MISSISSIPPI - 4.73%
2,200,000 Claiborne County, PCR,
National Rural/South Mississippi
4.00%, 06/15/00.................. 2,200,000
1,100,000 Harrison County, PCR,
duPont (E.I.) deNemours & Co.
5.85%, 09/01/10 (A).............. 1,100,000
2,000,000 Jackson County Water System
3.90%, 11/01/24 (A)
Guaranteed: Chevron Corp......... 2,000,000
6,600,000 Jackson County, PCR,
Chevron USA, Inc. Project
5.90%, 12/01/16 (A).............. 6,600,000
PAR VALUE VALUE
--------- -----
MISSISSIPPI (C0NTINUED)
$13,595,000 Mississippi State Highway Revenue,
Four Lane Highway Project, Series 39
4.50%, 06/01/00.................. $ 13,607,306
2,050,000 Perry County, PCR,
Leaf River Forest Project
5.90%, 03/01/02 (A)
LOC: Wachovia Bank N.A. ......... 2,050,000
-------------
27,557,306
-------------
NEVADA - 0.81%
4,700,000 Reno Hospital Revenue
St Mary's Regional Medical Center,
Series B
6.00%, 05/15/23 (A)
Insured: MBIA,
SPA: Rabobank Nederland NV....... 4,700,000
-------------
NEW MEXICO - 5.42%
6,000,000 Farmington, PCR,
Arizona Public Service Co.,
Series A
5.90%, 05/01/24 (A)
LOC: Bank of America NT & SA..... 6,000,000
5,200,000 Farmington, PCR,
Arizona Public Service Co.,
Series B
5.90%, 09/01/24 (A)
LOC: Barclays Bank Plc........... 5,200,000
3,900,000 Farmington, PCR,
El Paso Electric Co.,
Series A
5.10%, 11/01/13 (A)
LOC: Barclays Bank Plc........... 3,900,000
16,500,000 New Mexico State, TRAN
4.00%, 06/30/00.................. 16,520,153
-------------
31,620,153
-------------
NEW YORK - 4.15%
18,000,000 New York City Municipal Water
Finance Authority, Water & Sewer
System Revenue, Series G
5.90%, 06/15/24 (A)
LOC: FGIC,
SPA: FGIC-SPI.................... 18,000,000
1,700,000 New York State Energy
Research & Development Authority,
PCR, New York State Electric & Gas Corp.,
Series C
5.95%, 06/01/29 (A)
LOC: Morgan Guaranty Trust Co.... 1,700,000
4,500,000 New York State Energy Research &
Development Authority, PCR, New York
State Electric & Gas Corp., Series D
5.95%, 10/01/29 (A)
LOC: First National Bank of Chicago 4,500,000
-------------
24,200,000
-------------
SEE NOTES TO FINANCIAL STATEMENTS.
15
<PAGE>
TAX-EXEMPT FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
APRIL 30, 2000 (UNAUDITED)
PAR VALUE VALUE
--------- -----
NORTH CAROLINA - 2.72%
$9,700,000 North Carolina Educational
Facilities Finance Agency
Bowman Gray School Project
4.95%, 09/01/26 (A)
LOC: Wachovia Bank, N.A.......... $ 9,700,000
6,150,000 Wake County Industrial Facilities &
Pollution Control Financing Authority
Carolina Power & Light
Co. Project, Series A
5.95%, 06/15/14 (A)
LOC: First National Bank of Chicago 6,150,000
-------------
15,850,000
-------------
OHIO - 0.62%
1,700,000 Evandale, IDR, SHV Real Estate, Inc.
4.60%, 09/01/15 (A)
LOC: ABN-AMRO Bank NV............ 1,700,000
1,900,000 Ohio State Air Quality
Development Authority Revenue
Cincinnati Gas & Electric, Series A
5.85%, 09/01/30 (A)
LOC: ABN-AMRO Bank NV............ 1,900,000
-------------
3,600,000
-------------
PENNSYLVANIA - 5.80%
2,140,000 Delaware County IDA,
Resource Recovery Facility,
Series G
4.90%, 12/01/31 (A)
Guaranteed: General Electric Corp. 2,140,000
3,005,000 Delaware County IDA,
Resource Recovery Facility,
Series G
4.90%, 12/01/31 (A)
Guaranteed: General Electric Corp. 3,005,000
4,400,000 Delaware County IDA,
Airport Facilities Revenue,
United Parcel Service Project
5.95%, 12/01/15 (A).............. 4,400,000
3,100,000 Delaware Valley Regional
Finance Authority Local
Government Revenue,
Series A
5.05%, 12/01/19 (A)
LOC: Credit Suisse First Boston.. 3,100,000
8,100,000 Delaware Valley Regional
Finance Authority Local
Government Revenue,
Series B
5.05%, 12/01/20 (A)
LOC: Credit Suisse First Boston.. 8,100,000
PAR VALUE VALUE
--------- -----
PENNSYLVANIA (CONTINUED)
$5,000,000 Delaware Valley Regional
Finance Authority Local
Government Revenue,
Series C
5.05%, 12/01/20 (A)
LOC: Credit Suisse First Boston.. $ 5,000,000
8,100,000 Lehigh County General Purpose
Authority Lehigh Valley Hospital,
Series A
5.95%, 07/01/28 (A)
Insured: AMBAC,
SPA: Chase Manhattan Bank........ 8,100,000
-------------
33,845,000
-------------
SOUTH CAROLINA - 3.78%
10,000,000 Spartanburg County
Health Services District, Inc.
Hospital Revenue
5.00%, 04/15/23 (A)
LOC: MBIA
SPA: NationsBank N.A. ........... 10,000,000
12,000,000 Spartanburg County
School District No. 7, BAN
4.75%, 02/15/01.................. 12,057,049
-------------
22,057,049
-------------
TENNESSEE - 4.07%
3,600,000 Chattanooga-Hamilton
County Hospital Authority
5.80%, 10/01/17 (A)
LOC: Morgan Guaranty Trust Co.... 3,600,000
9,370,000 Metropolitan Nashville Airport
Authority Special Facilities Revenue,
American Airlines Project, Series A
6.00%, 10/01/12 (A)
LOC: Credit Suisse First Boston.. 9,370,000
6,300,000 Metropolitan Nashville Airport
Authority Special Facilities Revenue,
American Airlines Project, Series B
6.00%, 10/01/12 (A)
LOC: Bayerische Landesbanke GZ... 6,300,000
1,000,000 Sullivan County, IDB, PCR,
Mead Corp. Project
5.95%, 10/01/16 (A)
LOC: UBSAG....................... 1,000,000
3,450,000 Tennessee State, Series A, GO
5.00%, 05/01/00.................. 3,450,000
-------------
23,720,000
-------------
TEXAS - 20.02%
2,000,000 Grapevine IDC,
American Airlines, Series B-4
6.00%, 12/01/24 (A)
LOC: Bayerische Landesbanke GZ... 2,000,000
SEE NOTES TO FINANCIAL STATEMENTS.
16
<PAGE>
TAX-EXEMPT FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
APRIL 30, 2000 (UNAUDITED)
PAR VALUE VALUE
--------- -----
TEXAS (CONTINUED)
$11,700,000 Gulf Coast Waste Disposal
Authority, PCR,
Amoco Oil Co. Project
5.85%, 10/01/17 (A).............. $ 11,700,000
12,500,000 Gulf Coast Waste Disposal
Authority, PCR, Exxon Project
4.90%, 10/01/24 (A).............. 12,500,000
13,000,000 Harris County IDC,
Baytank Houston, Inc. Project
5.05%, 02/01/20 (A)
LOC: Rabobank Nederland.......... 13,000,000
10,000,000 Hockley County IDC, PCR,
Amoco Project, Standard Oil Co.
4.10%, 03/01/14 (A).............. 10,001,006
15,000,000 Houston, TRAN
4.25%, 06/30/00.................. 15,021,427
10,000,000 Houston Higher Education Finance Corp.,
Rice University, Series A
3.75%, 05/10/00.................. 10,000,000
3,700,000 Lone Star Airport
Improvement Authority
American Airlines, Inc. Series A-3
6.00%, 12/01/14 (A)
LOC: Royal Bank of Canada........ 3,700,000
2,000,000 Lone Star Airport
Improvement Authority
American Airlines, Inc. Series A-4
6.00%, 12/01/14 (A)
LOC: Royal Bank of Canada........ 2,000,000
13,250,000 Lower Neches Valley Authority
Chevron USA, Inc. Project
3.95%, 02/15/17 (A).............. 13,250,000
1,930,000 North Central HFDC
Presbyterian Medical Center,
Series D
6.00%, 12/01/15 (A)
LOC: MBIA
SPA: NationsBank of Texas........ 1,930,000
11,100,000 Sabine River Authority, PCR,
Texas Utilities Project, Series A
5.85%, 03/01/26 (A)
Insured:AMBAC
SPA: Bank of New York............ 11,100,000
10,500,000 Texas State, TRAN, Series A
4.50%, 08/31/00.................. 10,527,059
-------------
116,729,492
-------------
PAR VALUE VALUE
--------- -----
UTAH - 3.34%
$10,000,000 Utah State, GO,
Series B
5.00%, 07/01/16 (A)
SPA: Toronto Dominion Bank....... $ 10,000,000
9,500,000 Utah State, GO,
Series C
5.00%, 07/01/16 (A)
SPA: Toronto Dominion Bank....... 9,500,000
-------------
19,500,000
-------------
VIRGINIA - 0.34%
2,000,000 Peninsula Ports Authority,
CTR, Dominion Terminal Project,
Series C
5.95%, 07/01/16 (A)
LOC: Barclays Bank Plc........... 2,000,000
-------------
WASHINGTON - 0.17%
1,000,000 Snohomish County Public Utility
District No. 1, Electric Revenue
Generation System
5.00%, 01/01/25 (A)
Insured: MBIA
SPA: Bayerische Vereinsbank...... 1,000,000
-------------
WISCONSIN - 1.26%
7,355,000 Wisconsin State, Series A, GO
4.50%, 05/01/00.................. 7,355,000
-------------
WYOMING - 3.75%
2,650,000 Converse City, PCR,
Pacificorp Project, Series 8
4.00%, 06/02/00
LOC: Deutsche Bank AG............ 2,650,000
2,700,000 Lincoln County, PCR,
Exxon Project, Series B
5.95%, 11/01/14 (A).............. 2,700,000
1,000,000 Platte County, PCR,
Tri-State G & T, Series A
6.10%, 07/01/14 (A)
LOC: National Rural Utility CFC... 1,000,000
14,500,000 Sweetwater County, PCR,
Pacificorp Project
4.00%, 08/11/00
LOC: UBS AG....................... 14,500,000
1,000,000 Unita County, PCR,
Chevron USA, Inc.
5.90%, 04/01/10 (A).............. 1,000,000
-------------
21,850,000
-------------
TOTAL MUNICIPAL SECURITIES ...... 626,165,802
-------------
(Cost $626,165,802)
SEE NOTES TO FINANCIAL STATEMENTS.
17
<PAGE>
TAX-EXEMPT FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
APRIL 30, 2000 (UNAUDITED)
SHARES VALUE
------ -----
INVESTMENT COMPANIES - 0.09%
208,521 Dreyfus Tax-Exempt Cash
Management Fund.................. $ 208,521
306,507 Federated Investors Tax-Free
Obligations Fund................. 306,507
-------------
TOTAL INVESTMENT COMPANIES ...... 515,028
-------------
(Cost $515,028)
TOTAL INVESTMENTS - 107.49%...................... 626,680,830
-------------
(Cost $626,680,830)*
NET OTHER ASSETS AND LIABILITIES - (7.49)%....... (43,661,459)
-------------
NET ASSETS - 100.00%............................. $ 583,019,371
=============
------------------------------------------------------------------
* Aggregate cost for federal tax purposes.
(A) Variable rate demand notes are payable upon not more than one, seven or
thirty business days notice. Put bonds and notes have demand features
which mature within one year. The interest rate shown reflects the rate
in effect at April 30, 2000.
AMBAC American Municipal Bond Assurance Corp.
BAN Bond Anticipation Notes
CFC Cooperative Finance Corp.
CTR Coal Term Revenue
FGIC Federal Guaranty Insurance Corp.
GNMA Government National Mortgage Association
GO General Obligation
HEFA Health and Educational Facilities Authority
HFA Health Facilities Authority
HFDC Health Facilities Development Corp.
IDA Industrial Development Authority
IDB Industrial Development Board
IDC Industrial Development Corp.
IDR Industrial Development Revenue
LOC Letter of Credit
MBIA Municipal Bond Insurance Association
PCR Pollution Control Revenue
SPA Stand-by Purchase Agreement
TRAN Tax and Revenue Anticipation Notes
SEE NOTES TO FINANCIAL STATEMENTS.
18
<PAGE>
U.S. TREASURY FUND
PORTFOLIO OF INVESTMENTS
APRIL 30, 2000 (UNAUDITED)
PAR VALUE VALUE
--------- -----
U.S. GOVERNMENT AND AGENCY OBLIGATIONS - 100.22%
U.S. TREASURY BILLS (A) - 43.45%
$70,000,000 5.41%, 05/04/00.................. $ 69,968,442
20,000,000 5.31%, 06/01/00.................. 19,908,636
90,000,000 5.58%, 06/08/00.................. 89,469,690
40,000,000 5.68%, 06/15/00.................. 39,716,250
45,000,000 5.73%, 06/22/00.................. 44,627,549
40,000,000 5.73%, 07/06/00.................. 39,580,167
80,000,000 5.65%, 07/13/00.................. 79,083,954
90,000,000 6.97%, 07/20/00.................. 88,870,891
--------------
471,225,579
--------------
FEDERAL HOME LOAN BANK - 28.58%
154,885,000 5.88%, 05/01/00 (A).............. 154,885,000
13,200,000 5.92%, 05/05/00 (A).............. 13,191,317
35,000,000 4.00%, 07/28/00 (B).............. 34,994,951
25,000,000 5.71%, 08/09/00.................. 24,995,697
25,000,000 6.13%, 10/04/00 (B).............. 24,992,672
9,000,000 5.92%, 10/13/00.................. 8,996,267
25,000,000 6.38%, 03/13/01.................. 24,974,027
23,250,000 5.19%, 03/29/01.................. 22,985,918
--------------
310,015,849
--------------
PAR VALUE VALUE
--------- -----
U.S. TREASURY NOTES - 23.96%
$100,000,000 5.50%, 05/31/00................. $ 99,987,937
50,000,000 6.25%, 05/31/00................. 50,022,403
40,000,000 5.38%, 06/30/00................. 39,962,501
50,000,000 5.38%, 07/31/00................. 49,940,756
20,000,000 6.13%, 07/31/00................. 20,011,849
--------------
259,925,446
--------------
FEDERAL FARM CREDIT BANK - 4.23%
10,000,000 5.88%, 05/11/00 (A)............. 9,983,667
30,000,000 6.04%, 09/01/00 (B)............. 29,996,975
6,000,000 5.13%, 04/02/01................. 5,927,455
--------------
45,908,097
--------------
TOTAL INVESTMENTS - 100.22%..................... 1,087,074,971
--------------
(Cost $1,087,074,971)*
NET OTHER ASSETS AND LIABILITIES - (0.22)%...... (2,349,424)
--------------
NET ASSETS - 100.00%............................ $1,084,725,547
==============
-----------------------------------------------
* Aggregate cost for federal tax purposes.
(A) Discount yield at time of purchase.
(B) Interest is reset at various time intervals.
The interest rate shown reflects the rate in effect at April 30, 2000.
SEE NOTES TO FINANCIAL STATEMENTS.
19
<PAGE>
CONNECTICUT MUNICIPAL MONEY MARKET FUND
PORTFOLIO OF INVESTMENTS
APRIL 30, 2000 (UNAUDITED)
PAR VALUE VALUE
--------- -----
MUNICIPAL SECURITIES - 95.56%
CALIFORNIA - 3.03%
$2,000,000 Los Angeles Regional Airports
Improvement Corp.
Lease Revenue, American Airlines, Inc.,
LA International Airport, Series A
6.00%, 12/01/24 (A)
LOC: Wachovia Bank, N.A. ........ $ 2,000,000
600,000 Los Angeles Regional Airports
Improvement Corp.
Lease Revenue, American Airlines, Inc.,
LA International Airport, Series C
6.00%, 12/01/24 (A)
LOC: Wachovia Bank, N.A. ........ 600,000
5,280,000 Los Angeles Regional Airports
Improvement Corp.,
Lease Revenue, LAX Two Corp.
6.00%, 12/01/25 (A)
LOC: Societe Generale............ 5,280,000
-------------
7,880,000
-------------
CONNECTICUT - 63.53%
2,000,000 Brookfield, BAN, GO
4.25%, 12/08/00.................. 2,003,525
1,905,000 Connecticut State,
Series A, GO
6.00%, 03/15/01.................. 1,935,605
11,740,000 Connecticut State,
Series B, GO
5.20%, 05/15/14 (A)
SPA: Bayerische
Hypo-Und Vereinsbank AG.......... 11,740,000
1,300,000 Connecticut State
Development Authority
Conco Project
5.00%, 11/01/05 (A)
LOC: Bayerische
Hypo-Und Vereinsbank AG.......... 1,300,000
11,140,000 Connecticut State
Development Authority
Health Care Corp.
for Independent Living
4.95%, 07/01/15 (A)
LOC: Chase Manhattan Bank, N.A... 11,140,000
2,600,000 Connecticut State
Development Authority,
PCR, Central Vermont Public Service
4.10%, 12/01/15 (A)
LOC: Toronto Dominion Bank....... 2,600,000
3,000,000 Connecticut State HEFA,
Hospital of St. Raphael, Series J
4.70%, 07/01/22 (A)
LOC: KBC Bank NV................. 3,000,000
PAR VALUE VALUE
--------- -----
CONNECTICUT (CONTINUED)
$7,300,000 Connecticut State HEFA,
Stamford Hospital Issue, Series H
4.70%, 07/01/24 (A)
Insured: MBIA
SPA: Chase Manhattan Bank, N.A... $ 7,300,000
3,800,000 Connecticut State HEFA,
Summerwood University Park,
Series A
4.70%, 07/01/30 (A)
LOC: LaSalle Bank N.A. .......... 3,800,000
2,800,000 Connecticut State HEFA,
Taft School, Series E
4.90%, 07/01/30 (A)
LOC: First Union National Bank... 2,800,000
7,500,000 Connecticut State HEFA,
Yale University,
Municipal Commercial Paper
3.90%, 06/15/00.................. 7,500,000
5,000,000 Connecticut State HEFA,
Yale University, Series T-1
5.20%, 07/01/29 (A).............. 5,000,000
2,000,000 Connecticut State HEFA,
Yale University, Series T-2
5.20%, 07/01/29 (A).............. 2,000,000
6,500,000 Connecticut State
Housing Finance Authority,
Housing Mortgage Finance Program,
Series D-3
4.85%, 11/15/28 (A)
Insured: AMBAC
SPA: Landesbank
Hessen-Thuringen GZ.............. 6,500,000
8,100,000 Connecticut State
Housing Finance Authority,
Housing Mortgage Finance Program,
Series G
4.90%, 05/15/18 (A)
Insured AMBAC
SPA: Morgan Guaranty Trust....... 8,100,000
3,600,000 Connecticut State, IDA,
Allen Group, Inc.
4.00%, 02/01/13 (A)
LOC: Bayerische
Hypo-Und Vereinsbank AG.......... 3,600,000
6,500,000 Connecticut State Special Assessment
Second Injury Fund,
Municipal Commercial Paper
3.70%, 05/15/00
LOC: Credit Communal de Belgique. 6,500,000
5,500,000 Connecticut State Special Assessment
Second Injury Fund,
Municipal Commercial Paper
3.75%, 05/18/00
LOC: Credit Communal de Belgique. 5,500,000
SEE NOTES TO FINANCIAL STATEMENTS.
20
<PAGE>
CONNECTICUT MUNICIPAL MONEY MARKET FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
APRIL 30, 2000 (UNAUDITED)
PAR VALUE VALUE
--------- -----
CONNECTICUT (CONTINUED)
$ 7,000,000 Connecticut State Special Assessment
Unemployment Compensation
Advisory Fund, Series C
3.38%, 11/15/01 (A)
Insured: FGIC
SPA: FGIC - SPI.................. $ 7,000,000
12,200,000 Connecticut State Special Tax
Obligation Revenue, Second Lien
Transportation Infrastructure,
Series 1
5.00%, 12/01/10 (A)
LOC: Commerzbank AG.............. 12,200,000
1,290,000 Darien, GO
4.00%, 08/01/00.................. 1,291,920
3,405,000 Hamden, BAN, GO
4.25%, 01/24/01.................. 3,415,325
2,600,000 Milford, BAN, GO
4.00%, 11/09/00.................. 2,604,595
2,000,000 Regional School District No. 14,
Woodbury & Bethlehem, BAN
3.75%, 05/25/00.................. 2,000,829
7,550,000 Ridgefield, BAN, GO
3.50%, 07/12/00.................. 7,552,874
10,000,000 Shelton, BAN, GO
4.00%, 11/21/00.................. 10,009,111
8,000,000 Trumbull, BAN, GO
4.50%, 01/16/01.................. 8,038,325
10,000,000 West Haven, BAN, GO
4.50%, 07/18/00.................. 10,015,845
2,130,000 Westport, BAN, GO
3.50%, 07/26/00.................. 2,130,969
6,795,000 Wilton, BAN, GO
3.50%, 07/19/00.................. 6,797,839
-------------
165,376,762
-------------
ILLINOIS - 0.62%
1,600,000 Chicago O'Hare International Airport
American Airlines, Series C
5.80%, 12/01/17 (A)
LOC: Royal Bank of Canada........ 1,600,000
-------------
MISSISSIPPI - 3.31%
3,600,000 Jackson County, PCR,
Chevron U.S.A., Inc. Project
5.90%, 12/01/16 (A).............. 3,600,000
5,000,000 Perry County, PCR,
Leaf River Forest Project
5.90%, 03/01/02 (A)
LOC: Wachovia Bank N.A........... 5,000,000
-------------
8,600,000
-------------
PAR VALUE VALUE
--------- -----
NEW YORK - 2.31%
$5,000,000 New York City Municipal
Water Financing Authority,
Water & Sewer System Revenue,
Series G
5.90%, 06/15/24 (A)
LOC: FGIC
SPA: FGIC-SPI.................... $ 5,000,000
1,000,000 New York State
Energy Research & Development,
PCR, New York State Electric & Gas,
Series C
5.95%, 06/01/29 (A)
LOC: Morgan Guaranty Trust....... 1,000,000
-------------
6,000,000
-------------
NORTH CAROLINA - 2.80%
7,300,000 Wake County Industrial Facilities &
Pollution Control Financing Authority
Revenue,
Carolina Power & Light Co. Project,
Series A
5.95%, 06/15/14 (A)
LOC: First National Bank of Chicago 7,300,000
-------------
OHIO - 1.65%
1,400,000 Ohio State
Air Quality Development Authority Revenue,
Cincinnati Gas & Electric, Series A
5.85%, 09/01/30 (A)
LOC: ABN-AMRO Bank NV............ 1,400,000
2,900,000 Ohio State
Air Quality Development Authority Revenue,
Mead Corp.
5.95%, 10/01/01 (A)
LOC: Deutsche Bank A.G. ......... 2,900,000
-------------
4,300,000
-------------
OREGON - 1.38%
3,600,000 Portland Pollution Control,
Reynolds Metals Co.
6.00%, 12/01/09 (A)
LOC: Bank of Nova Scotia......... 3,600,000
-------------
SEE NOTES TO FINANCIAL STATEMENTS.
21
<PAGE>
CONNECTICUT MUNICIPAL MONEY MARKET FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
APRIL 30, 2000 (UNAUDITED)
PAR VALUE VALUE
--------- -----
PUERTO RICO - 8.64%
$12,600,000 Puerto Rico Commonwealth
Government Development Bank
4.75%, 12/01/15 (A)
Insured: MBIA
SPA: Credit Suisse First Boston.. $ 12,600,000
9,900,000 Puerto Rico Commonwealth
Highway & Transportation Authority,
Series A
4.90%, 07/01/28 (A)
Insured: AMBAC
SPA: Bank of Nova Scotia......... 9,900,000
-------------
22,500,000
-------------
TEXAS - 5.34%
4,500,000 Grapevine IDC, American Airlines,
Series A-3
6.00%, 12/01/24 (A)
LOC: Bayerische Landesbank....... 4,500,000
5,690,000 Guadalupe-Blanco River Authority,
PCR, Central Power & Light Co., Project
5.85%, 11/01/15 (A)
LOC: ABN AMRO Bank N.V........... 5,690,000
1,900,000 Lone Star Airport Improvement
Authority, American Airlines,
Series A-5
6.00%, 12/01/14 (A)
LOC: Royal Bank of Canada........ 1,900,000
1,800,000 Lone Star Airport Improvement
Authority, American Airlines,
Series B-3
6.00%, 12/01/14 (A)
LOC: Royal Bank of Canada........ 1,800,000
-------------
13,890,000
-------------
VIRGINIA - 2.07%
5,400,000 Peninsula Ports Authority, CTR,
Dominion Terminal Association Project,
Series C
5.95%, 07/01/16 (A)
LOC: Barclays Bank Plc........... 5,400,000
-------------
WYOMING - 0.88%
1,300,000 Lincoln County, PCR, Exxon Project,
Series A
5.95%, 11/01/14 (A).............. 1,300,000
1,000,000 Lincoln County, PCR, Exxon Project,
Series B
5.95%, 11/01/14 (A).............. 1,000,000
-------------
2,300,000
-------------
TOTAL MUNICIPAL SECURITIES ...... 248,746,762
-------------
(Cost $248,746,762)
SHARES VALUE
------ -----
INVESTMENT COMPANY - 0.48%
1,243,092 Federated Municipal Trust
Connecticut Municipal Cash Trust. $ 1,243,092
-------------
TOTAL INVESTMENT COMPANY ........ 1,243,092
-------------
(Cost $1,243,092)
TOTAL INVESTMENTS - 96.04%....................... 249,989,854
-------------
(Cost $249,989,854)*
NET OTHER ASSETS AND LIABILITIES - 3.96%......... 10,322,515
-------------
NET ASSETS - 100.00%............................. $ 260,312,369
=============
------------------------------------------------------------
* Aggregate cost for federal tax purposes.
(A) Variable rate demand notes are payable upon not more than one, seven or
thirty business days notice. Put bonds and notes have demand features
which mature within one year. The interest rate shown reflects the rate
in effect at April 30, 2000.
AMBAC American Municipal Bond Assurance Corp.
BAN Bond Anticipation Notes
CTR Coal Term Revenue
FGIC Federal Guaranty Insurance Corp.
GO General Obligation
HEFA Health and Educational Facilities Authority
IDA Industrial Development Authority
IDC Industrial Development Corp.
LOC Letter of Credit
MBIA Municipal Bond Insurance Association
PCR Pollution Control Revenue
SPA Stand-by Purchase Agreement
SEE NOTES TO FINANCIAL STATEMENTS.
22
<PAGE>
MASSACHUSETTS MUNICIPAL MONEY MARKET FUND
PORTFOLIO OF INVESTMENTS
APRIL 30, 2000 (UNAUDITED)
PAR VALUE VALUE
--------- -----
MUNICIPAL SECURITIES - 100.02%
ALASKA - 1.93%
$ 2,500,000 Valdez Alaska Marine Terminal
Exxon Pipeline Co. Project, Series A
5.85%, 12/01/33 (A).............. $ 2,500,000
2,500,000 Valdez Alaska Marine Terminal
Exxon Pipeline Co. Project, Series C
5.85%, 12/01/33 (A).............. 2,500,000
-------------
5,000,000
-------------
CALIFORNIA - 2.53%
1,100,000 Los Angeles Regional Airports
Improvement Corp., Lease Revenue,
American Airlines, Inc.,
LA International Airport, Series A
6.00%, 12/01/24 (A)
LOC: Wachovia Bank, N.A. ........ 1,100,000
5,455,000 Los Angeles Regional Airports
Improvement Corp.,
Lease Revenue, Lax Two Corp.
6.00%, 12/01/25 (A)
LOC: Societe Generale............ 5,455,000
-------------
6,555,000
-------------
LOUISIANA - 1.54%
4,000,000 Louisiana Offshore Terminal
Authority Deepwater Port Revenue
Loop, Inc., 1st Stage
5.90%, 09/01/06 (A)
LOC: UBS AG...................... 4,000,000
-------------
MASSACHUSETTS - 66.94%
1,350,000 Belmont, BAN, GO
3.75%, 09/06/00.................. 1,350,681
7,300,000 Boston Water and Sewer Commission
General Purpose, Senior Series A
4.90%, 11/01/24 (A)
LOC: State Street................ 7,300,000
4,000,000 Brookline, BAN, GO
3.50%, 06/01/00.................. 4,001,148
2,750,000 Easton, BAN, GO
3.75%, 08/11/00.................. 2,751,475
6,000,000 Hingham, BAN, GO
3.75%, 09/28/00.................. 6,001,162
3,900,000 Holyoke, PCR,
Holyoke Water & Power Co.
4.85%, 11/01/13 (A)
LOC: Toronto Dominion Bank....... 3,900,000
2,500,000 Massachusetts Municipal
Wholesale Electric Co.
Power Supply System, Series C
5.00%, 07/01/19 (A)
Insured MBIA
LOC: Credit Suisse First Boston.. 2,500,000
PAR VALUE VALUE
--------- -----
MASSACHUSETTS (CONTINUED)
$ 1,000,000 Massachusetts Port Authority,
Municipal Commercial Paper
4.05%, 06/12/00
LOC: Westdeutsche Landesbank GZ.. $ 1,000,000
13,000,000 Massachusetts State,
Series B, GO
5.00%, 09/01/16 (A)
SPA: Toronto Dominion Bank....... 13,000,000
9,320,000 Massachusetts State HEFA,
Amherst College, Series F
4.95%, 11/01/26 (A).............. 9,320,000
4,000,000 Massachusetts State HEFA,
Capital Asset Program, Series A
4.85%, 01/01/01 (A)
LOC: First National Bank of Chicago 4,000,000
3,200,000 Massachusetts State HEFA,
Capital Asset Program, Series E
5.85%, 01/01/35 (A)
LOC: First National Bank of Chicago 3,200,000
2,500,000 Massachusetts State HEFA,
Capital Asset Program, Series G-1
4.75%, 01/01/19 (A)
LOC: MBIA
SPA: Credit Suisse First Boston.. 2,500,000
4,220,000 Massachusetts State HEFA,
Harvard University
5.00%, 08/01/17 (A).............. 4,220,000
5,100,000 Massachusetts State HEFA,
Harvard University, Series Q
5.00%, 02/01/16 (A).............. 5,100,000
8,000,000 Massachusetts State HEFA,
Harvard University, Series R
5.00%, 11/01/49 (A).............. 8,000,000
11,900,000 Massachusetts State HEFA,
Newton Wellesley Hospital, Series F
4.80%, 07/01/25 (A)
Insured MBIA
LOC: Credit Suisse First Boston.. 11,900,000
4,700,000 Massachusetts State HEFA,
Partners Healthcare System, Series P-2
5.00%, 07/01/27 (A)
Insured:FSA
SPA: Morgan Guaranty
Trust/Bayerische Landesbank GZ... 4,700,000
12,000,000 Massachusetts State HEFA,
Wellesley College, Series G
5.60%, 07/01/39 (A).............. 12,000,000
11,200,000 Massachusetts State
Housing Finance Agency
Multi-Family, Series A
4.95%, 12/01/25 (A)
Insured: GNMA
SPA: Republic National
Bank of New York................. 11,200,000
SEE NOTES TO FINANCIAL STATEMENTS.
23
<PAGE>
MASSACHUSETTS MUNICIPAL MONEY MARKET FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
APRIL 30, 2000 (UNAUDITED)
PAR VALUE VALUE
--------- -----
MASSACHUSETTS (CONTINUED)
$1,800,000 Massachusetts State IFA,
Buckingham Brown Nichols Issue
4.90%, 05/01/27 (A)
LOC: State Street................ $ 1,800,000
1,500,000 Massachusetts State IFA,
Gordon College Issue
4.90%, 12/01/27 (A)
LOC: State Street................ 1,500,000
1,000,000 Massachusetts State IFA,
Governor Dummer Academy
4.90%, 07/01/26 (A)
LOC: State Street................ 1,000,000
9,300,000 Massachusetts State IFA,
PCR, Holyoke Water Power Co.,
Series A
4.85%, 05/01/22 (A)
LOC: Canadian
Imperial Bank of Commerce........ 9,300,000
10,600,000 Massachusetts State
Water Resource Authority
Subordinated, General Purpose,
Series A
4.95%, 04/01/28 (A)
Insured: AMBAC
SPA: Bank of Nova Scotia......... 10,600,000
7,000,000 Natick, BAN, GO, Lot A
3.75%, 08/04/00.................. 7,005,280
3,105,000 Norwell, BAN, GO
4.75%, 07/14/00.................. 3,108,396
2,075,000 Pembroke, BAN, GO
4.75%, 07/27/00.................. 2,077,670
7,000,000 Reading, BAN, GO
4.13%, 01/11/01.................. 7,008,189
4,970,000 Wellesley, BAN, GO
3.50%, 06/07/00.................. 4,971,702
2,750,000 Westfield, BAN, GO
4.75%, 02/01/01.................. 2,758,965
4,560,000 Weston, BAN, GO
4.10%, 09/14/00.................. 4,566,881
-------------
173,641,549
-------------
MICHIGAN - 0.58%
1,495,000 Cornell Township Economic
Development Corp.,
Mead Escabana Paper Co.
5.95%, 11/01/16 (A)
LOC: Bank of America NT & SA..... 1,495,000
-------------
MISSISSIPPI - 2.43%
1,000,000 Harrison County, PCR,
E.I. duPont deNemours Project
5.85%, 09/01/10 (A).............. 1,000,000
1,000,000 Jackson County,
PCR, Chevron U.S.A., Inc. Project
5.90%, 12/01/16 (A).............. 1,000,000
PAR VALUE VALUE
--------- -----
MISSISSIPPI (CONTINUED)
$4,300,000 Perry County, PCR,
Leaf River Forest Project
5.90%, 03/01/02 (A)
LOC: Wachovia Bank N.A. ......... $ 4,300,000
-------------
6,300,000
-------------
MISSOURI - 0.39%
1,000,000 Kansas City, IDA Hospital Revenue,
Research Health Services System
6.10%, 04/15/15 (A)
Insured: MBIA
SPA: Bank of America............. 1,000,000
-------------
NEW MEXICO - 0.50%
1,300,000 Farmington, PCR,
Arizona Public Service Co.,
Series A
5.90%, 05/01/24 (A)
LOC: Bank of America NT & SA..... 1,300,000
-------------
NEW YORK - 4.16%
5,100,000 Long Island Power Authority
Electric Systems Revenue, Series 6
5.95%, 05/01/33 (A)
LOC: ABN-AMRO
Bank NV/Morgan Guaranty Trust.... 5,100,000
5,700,000 New York City Municipal
Water Finance Authority,
Water & Sewer System Revenue,
Series G
5.90%, 06/15/24 (A)
LOC: FGIC
SPA: FGIC-SPI.................... 5,700,000
-------------
10,800,000
-------------
NORTH CAROLINA - 1.83%
4,750,000 Wake County Industrial Facilities &
Pollution Control Financing Authority
Revenue, Carolina Power &
Light Co. Project, Series A
5.95%, 06/15/14 (A)
LOC: First National Bank of Chicago 4,750,000
-------------
OHIO - 2.35%
2,000,000 Cuyahoga County Hospital Revenue,
University Hospital of Cleveland
5.95%, 01/01/16 (A)
LOC: Chase Manhattan Bank........ 2,000,000
4,100,000 Ohio State Air Quality Development
Authority, Cincinnati Gas & Electric,
Series A
5.85%, 09/01/30 (A)
LOC: ABN-AMRO Bank NV............ 4,100,000
-------------
6,100,000
-------------
SEE NOTES TO FINANCIAL STATEMENTS.
24
<PAGE>
MASSACHUSETTS MUNICIPAL MONEY MARKET FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)
APRIL 30, 2000 (UNAUDITED)
PAR VALUE VALUE
--------- -----
OREGON - 1.66%
$ 4,300,000 Port Portland, PCR, Reynolds Metals Co.
6.00%, 12/01/09 (A)
LOC: Bank of Nova Scotia......... $ 4,300,000
-------------
PENNSYLVANIA - 2.89%
2,900,000 Delaware County, IDA,
Airport Facilities Revenue,
United Parcel Service Project
5.95%, 12/01/15 (A).............. 2,900,000
4,600,000 Lehigh County General Purpose
Authority Revenues,
Lehigh Valley Hospitals, Series A
5.95%, 07/01/28 (A)
Insured: AMBAC
SPA: Chase Manhattan Bank........ 4,600,000
-------------
7,500,000
-------------
PUERTO RICO - 0.39%
1,000,000 Puerto Rico Commonwealth Highway &
Transportation Authority, Series A
4.90%, 07/01/28 (A)
Insured: AMBAC
SPA: Bank of Nova Scotia......... 1,000,000
-------------
TENNESSEE - 2.12%
5,500,000 Metropolitan Nashville Airport Authority
Special Facilities Revenue,
American Airlines Project, Series B
6.00%, 10/01/12 (A)
LOC: Bayerische Landesbank GZ.... 5,500,000
-------------
TEXAS - 3.78%
1,400,000 Grapevine IDC, American Airlines, Series B-1
6.00%, 12/01/24 (A)
LOC: Morgan Guaranty Trust....... 1,400,000
2,500,000 Harris County Industrial Development
Corp., PCR, Exxon Corp.
5.80%, 03/01/24 (A).............. 2,500,000
1,000,000 Lone Star Airport Improvement
Authority, American Airlines, Inc.,
Series A-1
6.00%, 12/01/14 (A)
LOC: Royal Bank of Canada........ 1,000,000
3,700,000 Lone Star Airport Improvement
Authority, American Airlines, Inc.,
Series B-2
6.00%, 12/01/14 (A)
LOC: Royal Bank of Canada........ 3,700,000
1,200,000 Sabine River Authority, PCR,
Texas Utilities Project, Series A
5.85%, 03/01/26 (A)
Insured: AMBAC,
SPA: Bank of New York............ 1,200,000
-------------
9,800,000
-------------
PAR VALUE VALUE
--------- -----
VIRGINIA - 1.77%
$4,605,000 Peninsula Ports Authority, CTR,
Dominion Terminal Association Project,
Series C
5.95%, 07/01/16 (A)
LOC: Barclays Bank Plc........... $ 4,605,000
-------------
WYOMING - 2.23%
2,300,000 Lincoln County, PCR, Exxon Project,
Series D
5.95%, 11/01/14 (A).............. 2,300,000
3,500,000 Uinta County, PCR, Amoco Project
5.85%, 07/01/26 (A).............. 3,500,000
-------------
5,800,000
-------------
TOTAL MUNICIPAL SECURITIES ...... 259,446,549
-------------
(Cost $259,446,549)
Shares
------
INVESTMENT COMPANIES - 0.46%
196,704 Dreyfus Massachusestts
Tax-Exempt Money Market.......... 196,704
376,677 Federated Municipal Trust
Massachusetts Municipal Cash Trust 376,677
616,322 Federated Municipal Trust
Tax-Exempt Money Market.......... 616,322
-------------
TOTAL INVESTMENT COMPANIES ...... 1,189,703
-------------
(Cost $1,189,703)
TOTAL INVESTMENTS - 100.48%...................... 260,636,252
-------------
(Cost $260,636,252)*
NET OTHER ASSETS AND LIABILITIES - (0.48)%....... (1,240,335)
-------------
NET ASSETS - 100.00%............................. $ 259,395,917
=============
----------------------------------------------------------------------
* Aggregate cost for federal tax purposes.
(A) Variable rate demand notes are payable upon not more than one, seven or
thirty business days notice. Put bonds and notes have demand features
which mature within one year.The interest rate shown reflects the rate
in effect at April 30, 2000.
AMBAC American Municipal Bond Assurance Corp.
BAN Bond Anticipation Note
CTR Coal Term Revenue
FGIC Federal Guaranty Insurance Corp.
FSA Financial Security Assurance Co.
GNMA Government National Mortgage Association
GO General Obligation
HEFA Health and Educational Facilities Authority
IDA Industrial Development Authority
IFA Industrial Finance Authority
LOC Letter of Credit
MBIA Municipal Bond Insurance Association
PCR Pollution Control Revenue
SPA Stand-by Purchase Agreement
SEE NOTES TO FINANCIAL STATEMENTS.
25
<PAGE>
GALAXY MONEY MARKET FUNDS
STATEMENTS OF ASSETS AND LIABILITIES
APRIL 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
MONEY MARKET GOVERNMENT TAX-EXEMPT U.S. TREASURY
FUND FUND FUND FUND
-------------- ------------- ------------- --------------
<S> <C> <C> <C> <C>
ASSETS:
Investments (Note 2):
Investments at amortized cost.............................. $4,528,810,712 $ 793,234,364 $ 626,680,830 $1,087,074,971
Repurchase agreement....................................... 13,669,000 98,609,000 -- --
-------------- ------------- ------------- --------------
Total investments at value............................... 4,542,479,712 891,843,364 626,680,830 1,087,074,971
Cash......................................................... 15 802 -- 170
Receivable for shares sold................................... 37,621,091 3,382,305 3,891,426 3,868,357
Interest and dividends receivable............................ 18,549,041 4,530,729 4,721,980 6,279,405
-------------- ------------- ------------- --------------
Total Assets............................................... 4,598,649,859 899,757,200 635,294,236 1,097,222,903
-------------- ------------- ------------- --------------
LIABILITIES:
Dividends payable............................................ 9,244,604 2,523,195 1,116,423 2,048,782
Payable for investments purchased............................ 47,990,904 -- -- --
Payable for shares repurchased............................... 74,706,893 6,792,992 50,860,190 9,865,298
Investment advisory fee payable (Note 3)..................... 1,346,918 293,558 212,500 349,287
Payable to Fleet affiliates (Note 3)......................... 226,744 33,073 15,354 53,429
Payable to Administrator (Note 3)............................ 429,783 88,587 50,240 103,208
Trustees' fees and expenses payable (Note 3)................. 131,404 45,964 15,698 36,860
Payable to custodian......................................... -- -- 3,159 --
Accrued expenses and other payables.......................... 356,515 75,526 1,301 40,492
-------------- ------------- ------------- --------------
Total Liabilities.......................................... 134,433,765 9,852,895 52,274,865 12,497,356
-------------- ------------- ------------- --------------
NET ASSETS...................................................... $4,464,216,094 $ 889,904,305 $ 583,019,371 $1,084,725,547
============== ============= ============= ==============
NET ASSETS consist of:
Par value (Note 6)........................................... $ 4,463,981 $ 889,948 $ 583,170 $ 1,084,393
Paid-in capital in excess of par value....................... 4,459,509,455 889,057,634 582,587,225 1,083,309,013
Undistributed (overdistributed) net investment income (loss). 242,547 (43,277) (19,453) 316,537
Accumulated net realized gain (loss) on investments sold..... 111 -- (131,571) 15,604
-------------- ------------- ------------- --------------
Total Net Assets................................................ $4,464,216,094 $ 889,904,305 $ 583,019,371 $1,084,725,547
============== ============= ============= ==============
Retail A Shares:
Net assets................................................... $2,575,953,237 $ 336,770,013 $ 193,313,613 $ 607,745,375
Shares of beneficial interest outstanding.................... 2,575,799,499 336,386,461 193,382,560 607,557,857
-------------- ------------- ------------- --------------
NET ASSET VALUE, offering and redemption price per share... $ 1.00 $ 1.00 $ 1.00 $ 1.00
============== ============= ============= ==============
Retail B Shares:
Net assets................................................... $ 2,412,948 N/A N/A N/A
Shares of beneficial interest outstanding.................... 2,412,856 N/A N/A N/A
-------------- ------------- ------------- --------------
NET ASSET VALUE and offering price per share*.............. $ 1.00 N/A N/A N/A
============== ============= ============= ==============
Trust Shares:
Net assets................................................... $1,885,849,909 $ 553,134,292 $ 389,705,758 $ 476,980,172
Shares of beneficial interest outstanding.................... 1,885,768,954 553,561,119 389,787,835 476,835,549
-------------- ------------- ------------- --------------
NET ASSET VALUE, offering and redemption price per share..... $ 1.00 $ 1.00 $ 1.00 $ 1.00
============== ============= ============= ==============
-------------------------------------------------------------------
<FN>
* Redemption price per share is equal to the Net Asset Value per share
less any applicable contingent deferred sales charge.
</FN>
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
26
<PAGE>
<TABLE>
<CAPTION>
CONNECTICUT MUNICIPAL MASSACHUSETTS MUNICIPAL
MONEY MARKET FUND MONEY MARKET FUND
----------------- -----------------
<S> <C> <C>
ASSETS:
Investments (Note 2):
Investments at amortized cost.............................. $ 249,989,854 $ 260,636,252
Repurchase agreement....................................... -- --
------------- -------------
Total investments at value............................... 249,989,854 260,636,252
Cash......................................................... 448 14
Receivable for shares sold................................... 12,185,581 1,343,425
Interest and dividends receivable............................ 1,827,245 1,662,960
------------- ------------
Total Assets............................................... 264,003,128 263,642,651
------------- ------------
LIABILITIES:
Dividends payable............................................ 280,659 338,842
Payable for investments purchased............................ -- --
Payable for shares repurchased............................... 3,255,541 3,758,348
Investment advisory fee payable (Note 3)..................... 84,260 85,327
Payable to Fleet affiliates (Note 3)......................... 21,075 21,352
Payable to Administrator (Note 3)............................ 23,780 23,977
Trustees' fees and expenses payable (Note 3)................. 7,876 6,757
Payable to custodian......................................... -- --
Accrued expenses and other payables.......................... 17,568 12,131
------------ ------------
Total Liabilities.......................................... 3,690,759 4,246,734
------------ ------------
NET ASSETS...................................................... $260,312,369 $259,395,917
============ ============
NET ASSETS consist of:
Par value (Note 6)........................................... $ 260,319 $ 259,412
Paid-in capital in excess of par value....................... 260,064,877 259,153,170
Undistributed (overdistributed) net investment income (loss). (5,391) (4,085)
Accumulated net realized gain (loss) on investments sold..... (7,436) (12,580)
------------ ------------
Total Net Assets................................................ $260,312,369 $259,395,917
============ ============
Retail A Shares:
Net assets................................................... $260,312,369 $259,395,917
Shares of beneficial interest outstanding.................... 260,318,577 259,412,418
------------ ------------
NET ASSET VALUE, offering and redemption price per share... $ 1.00 $ 1.00
============ ============
Retail B Shares:
Net assets................................................... N/A N/A
Shares of beneficial interest outstanding.................... N/A N/A
------------ ------------
NET ASSET VALUE and offering price per share*................ N/A N/A
============ ============
Trust Shares:
Net assets................................................... N/A N/A
Shares of beneficial interest outstanding.................... N/A N/A
------------ ------------
NET ASSET VALUE, offering and redemption price per share..... N/A N/A
============ ============
<FN>
* Redemption price per share is equal to the Net Asset Value per share
less any applicable contingent deferred sales charge.
</FN>
</TABLE>
27
<PAGE>
GALAXY MONEY MARKET FUNDS
STATEMENTS OF OPERATIONS
FOR THE SIX MONTHS ENDED APRIL 30, 2000 (UNAUDITED)
<TABLE>
<CAPTION>
MONEY MARKET GOVERNMENT TAX-EXEMPT U.S. TREASURY
FUND FUND FUND FUND
------------ ----------- ----------- -----------
<S> <C> <C> <C> <C> <C>
INVESTMENT INCOME:
Interest (Note 2) ........................................... $124,840,403 $ 27,077,716 $10,938,491 $28,701,583
Dividends (Note 2) .......................................... -- -- 51,498 --
------------ ----------- ----------- -----------
Total Investment Income ................................... 124,840,403 27,077,716 10,989,989 28,701,583
------------ ----------- ----------- -----------
EXPENSES:
Investment advisory fee (Note 3) ............................ 8,458,403 1,884,074 1,223,862 2,029,068
Administration fee (Note 3) ................................. 1,559,446 347,343 225,562 388,112
Custodian fee (Note 3) ...................................... 36,213 11,058 18,516 12,027
Fund accounting fee (Note 3) ................................ 72,209 47,043 69,005 81,445
Professional fees (Note 3) .................................. 93,837 25,491 23,830 27,435
Shareholder servicing and 12b-1 fees (Note 3) ............... 1,195,771 171,131 82,067 288,815
Transfer agent fee (Note 3) ................................. 1,033,071 165,912 22,044 168,693
Trustees' fees and expenses (Note 3) ........................ 62,839 18,716 9,203 18,706
Reports to shareholders (Note 3) ............................ 252,751 28,338 6,371 41,000
Miscellaneous ............................................... 212,960 40,842 43,078 39,615
------------ ----------- ----------- -----------
Total expenses before reimbursement/waiver (Note 4) ....... 12,977,500 2,739,948 1,723,538 3,094,916
------------ ----------- ----------- -----------
Less: reimbursement/waiver (Note 4) ....................... (871,455) (48,863) -- --
------------ ----------- ----------- -----------
Total expenses net of reimbursement/waiver .............. 12,106,045 2,691,085 1,723,538 3,094,916
------------ ----------- ----------- -----------
NET INVESTMENT INCOME .......................................... 112,734,358 24,386,631 9,266,451 25,606,667
------------ ----------- ----------- -----------
NET REALIZED GAIN ON INVESTMENTS SOLD (NOTE 2) ................. 111 -- -- 15,604
------------ ----------- ----------- -----------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS ............................................ $112,734,469 $ 24,386,631 $ 9,266,451 $25,622,271
============ =========== =========== ===========
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
28
<PAGE>
<TABLE>
<CAPTION>
CONNECTICUT MUNICIPAL MASSACHUSETTS MUNICIPAL
MONEY MARKET FUND MONEY MARKET FUND
------------------- -------------------
<S> <C> <C> <C>
INVESTMENT INCOME:
Interest (Note 2) ........................................... $ 4,379,128 $ 4,445,352
Dividends (Note 2) .......................................... 24,408 34,460
----------- ------------
Total Investment Income ................................... 4,403,536 4,479,812
----------- ------------
EXPENSES:
Investment advisory fee (Note 3) ............................ 503,042 505,514
Administration fee (Note 3) ................................. 92,726 93,178
Custodian fee (Note 3) ...................................... 3,223 6,898
Fund accounting fee (Note 3) ................................ 40,410 45,387
Professional fees (Note 3) .................................. 21,158 15,817
Shareholder servicing and 12b-1 fees (Note 3) ............... 125,460 124,424
Transfer agent fee (Note 3) ................................. 12,522 10,340
Trustees' fees and expenses (Note 3) ........................ 5,425 5,564
Reports to shareholders (Note 3) ............................ 2,838 2,887
Miscellaneous ............................................... 10,874 11,385
----------- ------------
Total expenses before reimbursement/waiver (Note 4) ....... 817,678 821,394
----------- ------------
Less: reimbursement/waiver (Note 4) ....................... (31,226) (31,446)
----------- ------------
Total expenses net of reimbursement/waiver .............. 786,452 789,948
----------- ------------
NET INVESTMENT INCOME .......................................... 3,617,084 3,689,864
----------- ------------
NET REALIZED GAIN ON INVESTMENTS SOLD (NOTE 2) ................. -- --
----------- ------------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS ............................................ $ 3,617,084 $ 3,689,864
=========== ============
</TABLE>
29
<PAGE>
GALAXY MONEY MARKET FUNDS
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
MONEY MARKET FUND GOVERNMENT FUND
----------------------------- -----------------------------
SIX MONTHS SIX MONTHS
ENDED YEAR ENDED ENDED YEAR ENDED
APRIL 30, 2000 OCTOBER 31, APRIL 30, 2000 OCTOBER 31,
(UNAUDITED) 1999 (UNAUDITED) 1999
-------------- ------------- ------------- --------------
<S> <C> <C> <C> <C>
NET ASSETS AT BEGINNING OF PERIOD .............................. $4,117,022,862 $3,403,719,219 $ 941,063,718 $1,075,274,938
-------------- -------------- ------------- --------------
INCREASE IN NET ASSETS RESULTING FROM OPERATIONS:
Net investment income ....................................... 112,734,358 174,007,413 24,386,631 45,883,014
Net realized gain on investments sold ....................... 111 19,413 -- 37,116
-------------- -------------- ------------- --------------
Net increase in net assets resulting from operations ...... 112,734,469 174,026,826 24,386,631 45,920,130
-------------- -------------- ------------- --------------
DIVIDENDS TO SHAREHOLDERS FROM:
RETAIL A SHARES:
Net investment income ..................................... (65,312,493) (104,393,213) (8,785,649) (15,592,532)
-------------- -------------- ------------- --------------
RETAIL B SHARES:
Net investment income ..................................... (53,426) (86,034) N/A N/A
-------------- -------------- ------------- --------------
TRUST SHARES:
Net investment income ..................................... (47,368,439) (69,528,195) (15,739,756) (30,149,607)
-------------- -------------- ------------- --------------
Total Dividends to shareholders ......................... (112,734,358) (174,007,442) (24,525,405) (45,742,139)
-------------- -------------- ------------- --------------
NET INCREASE (DECREASE) FROM SHARE TRANSACTIONS(1) ............. 347,193,121 711,961,641 (51,020,639) (135,195,652)
-------------- -------------- ------------- --------------
CAPITAL CONTRIBUTION FROM INVESTMENT ADVISOR (NOTE 5) .......... -- 1,322,618 -- 806,441
-------------- -------------- ------------- --------------
Net increase (decrease) in net assets ....................... 347,193,232 713,303,643 (51,159,413) (134,211,220)
-------------- -------------- ------------- --------------
NET ASSETS AT END OF PERIOD (INCLUDING LINE A) ................. $4,464,216,094 $4,117,022,862 $ 889,904,305 $ 941,063,718
============== ============== ============= ==============
(A) Undistributed (overdistributed) net investment income (loss) $ 242,547 $ 242,547 $ (43,277) $ 95,497
============== ============== ============= ==============
---------------------------------------------------------------------
<FN>
(1) For detail on share transactions by series, see Statements of Changes in Net
Assets - Capital Stock Activity on page 32 and 33.
</FN>
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
30
<PAGE>
<TABLE>
<CAPTION>
TAX-EXEMPT FUND U.S. TREASURY FUND
----------------------------- -----------------------------
SIX MONTHS SIX MONTHS
ENDED YEAR ENDED ENDED YEAR ENDED
APRIL 30, 2000 OCTOBER 31, APRIL 30, 2000 OCTOBER 31,
(UNAUDITED) 1999 (UNAUDITED) 1999
-------------- ------------- ------------- --------------
<S> <C> <C> <C> <C>
NET ASSETS AT BEGINNING OF PERIOD .............................. $ 716,194,717 $ 391,515,416 $1,044,155,421 $ 988,698,222
-------------- ------------- -------------- --------------
INCREASE IN NET ASSETS RESULTING FROM OPERATIONS:
Net investment income ....................................... 9,266,451 15,160,727 25,606,667 42,909,407
Net realized gain on investments sold ....................... -- -- 15,604 10,820
-------------- ------------- -------------- --------------
Net increase in net assets resulting from operations ...... 9,266,451 15,160,727 25,622,271 42,920,227
-------------- ------------- -------------- --------------
DIVIDENDS TO SHAREHOLDERS FROM:
RETAIL A SHARES:
Net investment income ..................................... (2,443,342) (4,259,280) (13,904,405) (24,098,884)
-------------- ------------- -------------- --------------
RETAIL B SHARES:
Net investment income ..................................... N/A N/A N/A N/A
-------------- ------------- -------------- --------------
TRUST SHARES:
Net investment income ..................................... (6,823,109) (10,901,372) (11,702,262) (18,810,523)
-------------- ------------- -------------- --------------
Total Dividends to shareholders ......................... (9,266,451) (15,160,652) (25,606,667) (42,909,407)
-------------- ------------- -------------- --------------
NET INCREASE (DECREASE) FROM SHARE TRANSACTIONS(1) ............. (133,175,346) 324,679,226 40,554,522 54,710,415
-------------- ------------- -------------- --------------
CAPITAL CONTRIBUTION FROM INVESTMENT ADVISOR (NOTE 5) .......... -- -- -- 735,964
-------------- ------------- -------------- --------------
Net increase (decrease) in net assets ....................... (133,175,346) 324,679.301 40,570,126 55,457,199
-------------- ------------- -------------- --------------
NET ASSETS AT END OF PERIOD (INCLUDING LINE A) ................. $ 583,019,371 $ 716,194,717 $1,084,725,547 $1,044,155,421
============== ============= ============== ==============
(A) Undistributed (overdistributed) net investment income (loss) $ (19,453) $ (19,453) $ 316,537 $ 316,537
============== ============= ============== ==============
<FN>
(1) For detail on share transactions by series, see Statements of Changes in Net
Assets - Capital Stock Activity on page 32 and 33.
</FN>
</TABLE>
<TABLE>
<CAPTION>
CONNECTICUT MUNICIPAL FUND MASSACHUSETTS MUNICIPAL FUND
----------------------------- -----------------------------
SIX MONTHS SIX MONTHS
ENDED YEAR ENDED ENDED YEAR ENDED
APRIL 30, 2000 OCTOBER 31, APRIL 30, 2000 OCTOBER 31,
(UNAUDITED) 1999 (UNAUDITED) 1999
-------------- ------------- ------------- --------------
<S> <C> <C> <C> <C>
NET ASSETS AT BEGINNING OF PERIOD .............................. $ 243,051,014 $ 165,185,627 $ 241,611,437 $ 127,921,915
-------------- ------------- ------------- --------------
INCREASE IN NET ASSETS RESULTING FROM OPERATIONS:
Net investment income ....................................... 3,617,084 5,240,021 3,689,864 5,034,474
Net realized gain on investments sold ....................... -- -- -- --
-------------- ------------- ------------- --------------
Net increase in net assets resulting from operations ...... 3,617,084 5,240,021 3,689,864 5,034,474
-------------- ------------- ------------- --------------
DIVIDENDS TO SHAREHOLDERS FROM:
RETAIL A SHARES:
Net investment income ..................................... (3,617,084) (5,240,300) (3,692,183) (5,036,187)
-------------- ------------- ------------- --------------
RETAIL B SHARES:
Net investment income ..................................... N/A N/A N/A N/A
-------------- ------------- ------------- --------------
TRUST SHARES:
Net investment income ..................................... N/A N/A N/A N/A
-------------- ------------- ------------- --------------
Total Dividends to shareholders ......................... (3,617,084) (5,240,300) (3,692,183) (5,036,187)
-------------- ------------- ------------- --------------
NET INCREASE (DECREASE) FROM SHARE TRANSACTIONS(1) ............. 17,261,355 77,865,666 17,786,799 113,691,235
-------------- ------------- ------------- --------------
CAPITAL CONTRIBUTION FROM INVESTMENT ADVISOR (NOTE 5) .......... -- -- -- --
-------------- ------------- ------------- --------------
Net increase (decrease) in net assets ....................... 17,261,355 77,865,387 17,784,480 113,689,522
-------------- ------------- ------------- --------------
NET ASSETS AT END OF PERIOD (INCLUDING LINE A) ................. $ 260,312,369 $ 243,051,014 $ 259,395,917 $ 241,611,437
============== ============= ============= ==============
(A) Undistributed (overdistributed) net investment income (loss) $ (5,391) $ (5,391) $ (4,085) $ (1,766)
============== ============= ============= ==============
<FN>
(1) For detail on share transactions by series, see Statements of Changes in Net
Assets - Capital Stock Activity on page 32 and 33.
</FN>
</TABLE>
31
<PAGE>
GALAXY MONEY MARKET FUNDS
STATEMENTS OF CHANGES IN NET ASSETS--
CAPITAL STOCK ACTIVITY
<TABLE>
<CAPTION>
MONEY MARKET FUND GOVERNMENT FUND
----------------------------- -----------------------------
SIX MONTHS SIX MONTHS
ENDED YEAR ENDED ENDED YEAR ENDED
APRIL 30, 2000 OCTOBER 31, APRIL 30, 2000 OCTOBER 31,
(UNAUDITED) 1999 (UNAUDITED) 1999
-------------- ------------- ------------- --------------
<S> <C> <C> <C> <C>
DOLLAR AMOUNTS
RETAIL A SHARES:
Sold ........................................................ $4,098,006,934 $6,810,510,960 $ 398,512,602 $ 752,972,310
Issued to shareholders in reinvestment of dividends ......... 65,005,130 103,931,212 8,755,192 15,539,078
Repurchased ................................................. (4,021,732,172) (6,619,773,827) (419,603,286) (772,791,398)
-------------- -------------- ------------- --------------
Net increase (decrease) in shares outstanding ............... $ 141,279,892 $ 294,668,345 $ (12,335,492) $ (4,280,010)
============== ============== ============= ==============
RETAIL B SHARES:
Sold ........................................................ $ 10,447,699 55,831,317 N/A N/A
Issued to shareholders in reinvestment of dividends ......... 47,210 65,248 N/A N/A
Repurchased ................................................. (10,566,910) (55,018,715) N/A N/A
-------------- -------------- ------------- --------------
Net increase (decrease) in shares outstanding ............... $ (72,001) $ 877,850 N/A N/A
============== ============== ============= ==============
TRUST SHARES:
Sold ........................................................ $1,679,267,797 $2,538,829,954 $ 674,341,514 $1,357,748,522
Issued to shareholders in reinvestment of dividends ......... 61,916 134,516 262,548 487,478
Repurchased ................................................. (1,473,344,483) (2,122,549,024) (713,289,209) (1,489,151,642)
-------------- -------------- ------------- --------------
Net increase (decrease) in shares outstanding ............... $ 205,985,230 $ 416,415,446 $ (38,685,147) $ (130,915,642)
============== ============== ============= ==============
SHARE ACTIVITY
RETAIL A SHARES:
Sold ........................................................ 4,098,006,934 6,810,510,960 398,512,602 752,972,310
Issued to shareholders in reinvestment of dividends ......... 65,005,130 103,931,212 8,755,192 15,539,078
Repurchased ................................................. (4,021,732,172) (6,619,773,827) (419,603,286) (772,791,398)
-------------- -------------- ------------- --------------
Net increase (decrease) in shares outstanding ............... 141,279,892 294,668,345 (12,335,492) (4,280,010)
============== ============== ============= ==============
RETAIL B SHARES:
Sold ........................................................ 10,447,699 55,831,317 N/A N/A
Issued to shareholders in reinvestment of dividends ......... 47,210 65,248 N/A N/A
Repurchased ................................................. (10,566,910) (55,018,715) N/A N/A
-------------- -------------- ------------- --------------
Net increase (decrease) in shares outstanding ............... (72,001) 877,850 N/A N/A
============== ============== ============= ==============
TRUST SHARES:
Sold ........................................................ 1,679,267,797 2,538,829,954 674,341,514 1,357,748,522
Issued to shareholders in reinvestment of dividends ......... 61,916 134,516 262,548 487,478
Repurchased ................................................. (1,473,344,483) (2,122,549,024) (713,289,209) (1,489,151,642)
-------------- -------------- ------------- --------------
Net increase (decrease) in shares outstanding ............... 205,985,230 416,415,446 (38,685,147) (130,915,642)
============== ============== ============= ==============
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
32
<PAGE>
<TABLE>
<CAPTION>
TAX-EXEMPT FUND U.S. TREASURY FUND
---------------------------- -----------------------------
SIX MONTHS SIX MONTHS
ENDED YEAR ENDED ENDED YEAR ENDED
APRIL 30, 2000 OCTOBER 31, APRIL 30, 2000 OCTOBER 31,
(UNAUDITED) 1999 (UNAUDITED) 1999
------------- ------------- -------------- -------------
<S> <C> <C> <C> <C>
DOLLAR AMOUNTS
RETAIL A SHARES:
Sold .................................................. $ 460,523,834 $ 579,782,056 $ 820,397,523 $1,323,763,867
Issued to shareholders in reinvestment of dividends ... 2,434,854 4,254,656 13,855,727 24,034,012
Repurchased ........................................... (429,690,882) (588,319,329) (810,883,178) (1,322,862,475)
------------- ------------- -------------- -------------
Net increase (decrease) in shares outstanding ......... $ 33,267,806 $ (4,282,617) $ 23,370,072 $ 24,935,404
============= ============= ============== =============
RETAIL B SHARES:
Sold .................................................. N/A N/A N/A N/A
Issued to shareholders in reinvestment of dividends ... N/A N/A N/A N/A
Repurchased ........................................... N/A N/A N/A N/A
------------- ------------- -------------- -------------
Net increase (decrease) in shares outstanding ......... N/A N/A N/A N/A
============= ============= ============== =============
TRUST SHARES:
Sold .................................................. $ 209,704,061 $ 618,365,910 $ 317,622,494 $ 701,245,755
Issued to shareholders in reinvestment of dividends ... -- -- 655,518 1,291,866
Repurchased ........................................... (376,147,213) (289,404,067) (301,093,562) (672,762,610)
------------- ------------- -------------- -------------
Net increase (decrease) in shares outstanding ......... $(166,443,152) $ 328,961,843 $ 17,184,450 $ 29,775,011
============= ============= ============== =============
SHARE ACTIVITY
RETAIL A SHARES:
Sold .................................................. 460,523,834 579,782,056 820,397,523 1,323,763,867
Issued to shareholders in reinvestment of dividends ... 2,434,854 4,254,657 13,855,727 24,034,012
Repurchased ........................................... (429,690,882) (588,319,329) (810,883,178)(1,322,862,475)
------------- ------------- -------------- -------------
Net increase (decrease) in shares outstanding ......... 33,267,806 (4,282,616) 23,370,072 24,935,404
============= ============= ============== =============
RETAIL B SHARES:
Sold .................................................. N/A N/A N/A N/A
Issued to shareholders in reinvestment of dividends ... N/A N/A N/A N/A
Repurchased ........................................... N/A N/A N/A N/A
------------- ------------- -------------- -------------
Net increase (decrease) in shares outstanding ......... N/A N/A N/A N/A
============= ============= ============== =============
TRUST SHARES:
Sold .................................................. 209,704,061 618,365,910 317,622,494 701,245,755
Issued to shareholders in reinvestment of dividends ... -- -- 655,518 1,291,866
Repurchased ........................................... (376,147,213) (289,404,067) (301,093,562) (672,762,610)
------------- ------------- -------------- -------------
Net increase (decrease) in shares outstanding ......... (166,443,152) 328,961,843 17,184,450 29,775,011
============= ============= ============== =============
</TABLE>
<TABLE>
<CAPTION>
CONNECTICUT MUNICIPAL MASSACHUSETTS MUNICIPAL
MONEY MARKET FUND MONEY MARKET FUND
---------------------------- -----------------------------
SIX MONTHS SIX MONTHS
ENDED YEAR ENDED ENDED YEAR ENDED
APRIL 30, 2000 OCTOBER 31, APRIL 30, 2000 OCTOBER 31,
(UNAUDITED) 1999 (UNAUDITED) 1999
------------- ------------- -------------- -------------
<S> <C> <C> <C> <C>
DOLLAR AMOUNTS
RETAIL A SHARES:
Sold ..................................................$ 311,984,554 $ 561,490,148 $ 341,284,334 $ 497,315,703
Issued to shareholders in reinvestment of dividends ... 1,910,402 2,878,303 1,533,501 2,079,087
Repurchased ........................................... (296,633,601) (486,502,785) (325,031,036) (385,703,555)
-------------- ------------- ------------- --------------
Net increase (decrease) in shares outstanding .........$ 17,261,355 $ 77,865,666 $ 17,786,799 $ 113,691,235
============== ============= ============= ==============
RETAIL B SHARES:
Sold .................................................. N/A N/A N/A N/A
Issued to shareholders in reinvestment of dividends ... N/A N/A N/A N/A
Repurchased ........................................... N/A N/A N/A N/A
-------------- ------------- ------------- --------------
Net increase (decrease) in shares outstanding ......... N/A N/A N/A N/A
============== ============= ============= ==============
TRUST SHARES:
Sold .................................................. N/A N/A N/A N/A
Issued to shareholders in reinvestment of dividends ... N/A N/A N/A N/A
Repurchased ........................................... N/A N/A N/A N/A
-------------- ------------- ------------- --------------
Net increase (decrease) in shares outstanding ......... N/A N/A N/A N/A
============== ============= ============= ==============
SHARE ACTIVITY
RETAIL A SHARES:
Sold .................................................. 311,984,554 561,490,148 341,284,334 497,315,703
Issued to shareholders in reinvestment of dividends ... 1,910,402 2,878,303 1,533,501 2,079,087
Repurchased ........................................... (296,633,601) (486,502,785) (325,031,036) (385,703,555)
-------------- ------------- ------------- --------------
Net increase (decrease) in shares outstanding ......... 17,261,355 77,865,666 17,786,799 113,691,235
============== ============= ============= ==============
RETAIL B SHARES:
Sold .................................................. N/A N/A N/A N/A
Issued to shareholders in reinvestment of dividends ... N/A N/A N/A N/A
Repurchased ........................................... N/A N/A N/A N/A
-------------- ------------- ------------- --------------
Net increase (decrease) in shares outstanding ......... N/A N/A N/A N/A
============== ============= ============= ==============
TRUST SHARES:
Sold .................................................. N/A N/A N/A N/A
Issued to shareholders in reinvestment of dividends ... N/A N/A N/A N/A
Repurchased ........................................... N/A N/A N/A N/A
-------------- ------------- ------------- --------------
Net increase (decrease) in shares outstanding ......... N/A N/A N/A N/A
============== ============= ============= ==============
</TABLE>
33
<PAGE>
MONEY MARKET FUND
FINANCIAL HIGHLIGHTS
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
RETAIL A SHARES
SIX MONTHS ENDED
APRIL 30, 2000 YEARS ENDED OCTOBER 31,
--------------------------------------------------------------
(UNAUDITED) 1999 1998 1997 1996 1995
----------- ----------- ----------- ----------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period....... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
----------- ----------- ----------- ----------- ----------- ----------
Income from Investment Operations:
Net investment income (A)................ 0.03 0.04 0.05 0.05 0.05 0.05
----------- ----------- ----------- ----------- ----------- ----------
Less Dividends:
Dividends from net investment income..... (0.03) (0.04) (0.05) (0.05) (0.05) (0.05)
----------- ----------- ----------- ----------- ----------- ----------
Net increase (decrease) in net asset value. -- -- -- -- --
----------- ----------- ----------- ----------- ----------- ----------
Net Asset Value, End of Period............. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
=========== =========== =========== =========== =========== ==========
Total Return (B)........................... 2.65%** 4.54% 5.04% 4.93% 4.78% 5.23%
Ratios/Supplemental Data:
Net Assets, End of Period (000's).......... $ 2,575,953 $ 2,434,662 $ 2,139,213 $ 1,877,889 $ 1,159,312 $ 580,762
Ratios to average net assets:
Net investment income including
reimbursement/waiver................... 5.26%* 4.45% 4.94% 4.85% 4.67% 5.12%
Operating expenses including reimbursement/waiver 0.64%* 0.65% 0.67% 0.69% 0.77% 0.74%
Operating expenses excluding reimbursement/waiver 0.68%* 0.69% 0.71% 0.73% 0.80% 0.76%
-----------------------------------------------------------------
<FN>
* Annualized.
** Not Annualized.
(1) Prior to November 1, 1994, the Fund offered a single series of shares. As
of such date, the existing series of shares was designated as Retail A
Shares and the Fund began issuing a second series of shares designated as
Trust Shares.
(2) The Fund began offering Retail B Shares on March 6, 1997.
(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, 2000 (unaudited) and the years ended October 31,
1999, 1998, 1997, 1996 and 1995 were $0.03, $0.04, $0.05, $0.05, $0.05 and
$0.05, 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, 2000 (unaudited) and
the years ended October 31, 1999, 1998, 1997, 1996 and 1995 were $0.03,
$0.05, $0.05, $0.05, $0.05 and $0.05, 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,
2000 (unaudited), the years ended October 31, 1999 and 1998 and the period
ended October 31, 1997 were $0.02, $0.04, $0.04 and $0.03, respectively.
(B) Calculation does not include the effect of any sales charge for Retail B
Shares.
</FN>
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
34
<PAGE>
<TABLE>
<CAPTION>
TRUST SHARES
SIX MONTHS ENDED
APRIL 30, 2000 YEARS ENDED OCTOBER 31,
------------------------------------------------------------
(UNAUDITED) 1999 1998 1997 1996 1995(1)
----------- ----------- ----------- ----------- ----------- ---------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period....... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
----------- ----------- ----------- ----------- ----------- -----------
Income from Investment Operations:
Net investment income (A)................ 0.03 0.05 0.05 0.05 0.05 0.05
----------- ----------- ----------- ----------- ----------- -----------
Less Dividends:
Dividends from net investment income..... (0.03) (0.05) (0.05) (0.05) (0.05) (0.05)
----------- ----------- ----------- ----------- ----------- -----------
Net increase (decrease) in net asset value. -- -- -- -- -- --
----------- ----------- ----------- ----------- ----------- -----------
Net Asset Value, End of Period............. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
=========== =========== =========== =========== =========== ===========
Total Return (B)........................... 2.73%** 4.72% 5.23% 5.13% 5.00% 5.43%
Ratios/Supplemental Data:
Net Assets, End of Period (000's).......... $ 1,885,850 $ 1,679,875 $ 1,262,900 $1,138,185 $ 924,222 $ 334,054
Ratios to average net assets:
Net investment income including
reimbursement/waiver................... 5.42%* 4.62% 5.12% 5.04% 4.89% 5.30%
Operating expenses including reimbursement/waiver 0.48%* 0.48% 0.49% 0.50% 0.55% 0.55%
Operating expenses excluding reimbursement/waiver 0.52%* 0.52% 0.53% 0.54% 0.58% 0.56%
-----------------------------------------------------------------
<FN>
* Annualized.
** Not Annualized.
(1) Prior to November 1, 1994, the Fund offered a single series of shares. As
of such date, the existing series of shares was designated as Retail A
Shares and the Fund began issuing a second series of shares designated as
Trust Shares.
(2) The Fund began offering Retail B Shares on March 6, 1997.
(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, 2000 (unaudited) and the years ended October 31,
1999, 1998, 1997, 1996 and 1995 were $0.03, $0.04, $0.05, $0.05, $0.05 and
$0.05, 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, 2000 (unaudited) and
the years ended October 31, 1999, 1998, 1997, 1996 and 1995 were $0.03,
$0.05, $0.05, $0.05, $0.05 and $0.05, 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,
2000 (unaudited), the years ended October 31, 1999 and 1998 and the period
ended October 31, 1997 were $0.02, $0.04, $0.04 and $0.03, respectively.
(B) Calculation does not include the effect of any sales charge for Retail B
Shares.
</FN>
</TABLE>
<TABLE>
<CAPTION>
RETAIL B SHARES
SIX MONTHS ENDED
APRIL 30, 2000 YEARS ENDED OCTOBER 31,
-----------------------------------
(UNAUDITED) 1999 1998 1997(2)
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Net Asset Value, Beginning of Period....... $ 1.00 $ 1.00 $ 1.00 $ 1.00
----------- ----------- ----------- -----------
Income from Investment Operations:
Net investment income (A)................ 0.02 0.04 0.04 0.03
----------- ----------- ----------- -----------
Less Dividends:
Dividends from net investment income..... (0.02) (0.04) (0.04) (0.03)
----------- ----------- ----------- -----------
Net increase (decrease) in net asset value. -- -- -- --
----------- ----------- ----------- -----------
Net Asset Value, End of Period............. $ 1.00 $ 1.00 $ 1.00 $ 1.00
=========== =========== =========== ===========
Total Return (B)........................... 2.28%** 3.85% 4.33% 2.66%**
Ratios/Supplemental Data:
Net Assets, End of Period (000's).......... $ 2,413 $ 2,485 $ 1,607 $ 749
Ratios to average net assets:
Net investment income including
reimbursement/waiver................... 4.55%* 3.81% 4.26% 4.27%*
Operating expenses including reimbursement/waiver 1.35%* 1.29% 1.35% 1.38%*
Operating expenses excluding reimbursement/waiver 1.46%* 1.41% 1.39% 1.42%*
-----------------------------------------------------------------
<FN>
* Annualized.
** Not Annualized.
(1) Prior to November 1, 1994, the Fund offered a single series of shares. As
of such date, the existing series of shares was designated as Retail A
Shares and the Fund began issuing a second series of shares designated as
Trust Shares.
(2) The Fund began offering Retail B Shares on March 6, 1997.
(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, 2000 (unaudited) and the years ended October 31,
1999, 1998, 1997, 1996 and 1995 were $0.03, $0.04, $0.05, $0.05, $0.05 and
$0.05, 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, 2000 (unaudited) and
the years ended October 31, 1999, 1998, 1997, 1996 and 1995 were $0.03,
$0.05, $0.05, $0.05, $0.05 and $0.05, 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,
2000 (unaudited), the years ended October 31, 1999 and 1998 and the period
ended October 31, 1997 were $0.02, $0.04, $0.04 and $0.03, respectively.
(B) Calculation does not include the effect of any sales charge for Retail B
Shares.
</FN>
</TABLE>
35
<PAGE>
GOVERNMENT FUND
FINANCIAL HIGHLIGHTS
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
RETAIL A SHARES
SIX MONTHS ENDED
APRIL 30, 2000 YEARS ENDED OCTOBER 31,
--------------------------------------------------------------
(UNAUDITED) 1999 1998 1997 1996 1995
----------- ----------- ----------- ----------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period....... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
----------- ----------- ----------- ----------- ----------- -----------
Income from Investment Operations:
Net investment income (A)................ 0.03 0.04 0.05 0.05 0.05 0.05
----------- ----------- ----------- ----------- ----------- ------------
Less Dividends:
Dividends from net investment income..... (0.03) (0.04) (0.05) (0.05) (0.05) (0.05)
----------- ----------- ----------- ----------- ----------- ------------
Net increase (decrease) in net asset value. -- -- -- -- -- --
----------- ----------- ----------- ----------- ----------- ------------
Net Asset Value, End of Period............. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
=========== =========== =========== =========== =========== ============
Total Return .............................. 2.57%** 4.39% 4.94% 4.85% 4.72% 5.20%
Ratios/Supplemental Data:
Net Assets, End of Period (000's).......... $ 336,770 $ 348,758 $ 352,799 $ 350,513 $ 326,411 $ 320,795
Ratios to average net assets:
Net investment income including
reimbursement/waiver................... 5.07%* 4.32% 4.84% 4.74% 4.62% 5.11%
Operating expenses including reimbursement/waiver 0.67%* 0.69% 0.70% 0.71% 0.75% 0.73%
Operating expenses excluding reimbursement/waiver 0.68%* 0.71% 0.71% 0.72% 0.76% 0.74%
---------------------------------------------------------
<FN>
* Annualized.
** Not Annualized.
(1) Prior to November 1, 1994, the Fund offered a single series of shares. As
of such date, the existing series of shares was designated as Retail A
Shares and the Fund began issuing a second series of shares designated as
Trust 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, 2000 (unaudited) and the years ended October 31,
1999, 1998, 1997, 1996 and 1995 were $0.03, $0.04, $0.05, $0.05, $0.05 and
$0.05, 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, 2000 (unaudited) and
the years ended October 31, 1999, 1998, 1997, 1996 and 1995 were $0.03,
$0.04, $0.05, $0.05, $0.05 and $0.05, respectively.
</FN>
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
36
<PAGE>
<TABLE>
<CAPTION>
TRUST SHARES
SIX MONTHS ENDED
APRIL 30, 2000 YEARS ENDED OCTOBER 31,
--------------------------------------------------
(UNAUDITED) 1999 1998 1997
------------- -------------- ------------- --------------
<S> <C> <C> <C> <C>
Net Asset Value, Beginning of Period....... $ 1.00 $ 1.00 $ 1.00 $ 1.00
------------- -------------- ------------- --------------
Income from Investment Operations:
Net investment income (A)................ 0.03 0.04 0.05 0.05
------------- -------------- ------------- --------------
Less Dividends:
Dividends from net investment income..... (0.03) (0.04) (0.05) (0.05)
------------- -------------- ------------- --------------
Net increase (decrease) in net asset value. -- -- -- --
------------- -------------- ------------- --------------
Net Asset Value, End of Period............. $ 1.00 $ 1.00 $ 1.00 $ 1.00
============= ============== ============= ==============
Total Return .............................. 2.65%** 4.58% 5.15% 5.06%
Ratios/Supplemental Data:
Net Assets, End of Period (000's).......... $ 553,134 $ 592,305 $ 722,476 $ 630,859
Ratios to average net assets:
Net investment income including
reimbursement/waiver................... 5.23%* 4.50% 5.03% 4.94%
Operating expenses including reimbursement/waiver 0.51%* 0.51% 0.51% 0.51%
Operating expenses excluding reimbursement/waiver 0.52%* 0.53% 0.52% 0.52%
---------------------------------------------------------
<FN>
* Annualized.
** Not Annualized.
(1) Prior to November 1, 1994, the Fund offered a single series of shares. As
of such date, the existing series of shares was designated as Retail A
Shares and the Fund began issuing a second series of shares designated as
Trust 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, 2000 (unaudited) and the years ended October 31,
1999, 1998, 1997, 1996 and 1995 were $0.03, $0.04, $0.05, $0.05, $0.05 and
$0.05, 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, 2000 (unaudited) and
the years ended October 31, 1999, 1998, 1997, 1996 and 1995 were $0.03,
$0.04, $0.05, $0.05, $0.05 and $0.05, respectively.
</FN>
</TABLE>
<TABLE>
<CAPTION>
YEARS ENDED OCTOBER 31,
----------------------------------
1996 1995(1)
------------- -------------
<S> <C> <C>
Net Asset Value, Beginning of Period....... $ 1.00 $ 1.00
------------- -------------
Income from Investment Operations:
Net investment income (A)................ 0.05 0.05
------------- -------------
Less Dividends:
Dividends from net investment income..... (0.05) (0.05)
------------- -------------
Net increase (decrease) in net asset value. -- --
------------- -------------
Net Asset Value, End of Period............. $ 1.00 $ 1.00
============= =============
Total Return .............................. 4.95% 5.39%
Ratios/Supplemental Data:
Net Assets, End of Period (000's).......... $ 733,759 $ 678,679
Ratios to average net assets:
Net investment income including
reimbursement/waiver................... 4.85% 5.27%
Operating expenses including reimbursement/waiver 0.52% 0.53%
Operating expenses excluding reimbursement/waiver 0.53% 0.54%
---------------------------------------------------------
<FN>
* Annualized.
** Not Annualized.
(1) Prior to November 1, 1994, the Fund offered a single series of shares. As
of such date, the existing series of shares was designated as Retail A
Shares and the Fund began issuing a second series of shares designated as
Trust 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, 2000 (unaudited) and the years ended October 31,
1999, 1998, 1997, 1996 and 1995 were $0.03, $0.04, $0.05, $0.05, $0.05 and
$0.05, 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, 2000 (unaudited) and
the years ended October 31, 1999, 1998, 1997, 1996 and 1995 were $0.03,
$0.04, $0.05, $0.05, $0.05 and $0.05, respectively.
</FN>
</TABLE>
37
<PAGE>
TAX-EXEMPT FUND
FINANCIAL HIGHLIGHTS
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
RETAIL A SHARES
SIX MONTHS ENDED
APRIL 30, 2000 YEARS ENDED OCTOBER 31,
-----------------------------------------------------------
(UNAUDITED) 1999 1998 1997 1996 1995
---------- --------- -------- -------- -------- ---------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period ............... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
--------- --------- -------- -------- -------- --------
Income from Investment Operations:
Net investment income (A) ....................... 0.01 0.02 0.03 0.03 0.03 0.03
--------- --------- -------- -------- -------- --------
Less Dividends:
Dividends from net investment income ............ (0.01) (0.02) (0.03) (0.03) (0.03) (0.03)
--------- --------- -------- -------- -------- --------
Net increase (decrease) in net asset value ......... -- -- -- -- -- --
--------- --------- -------- -------- -------- --------
Net Asset Value, End of Period ..................... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
========= ========= ======== ======== ======== ========
Total Return ....................................... 1.47%** 2.53% 2.89% 2.95% 2.82% 3.16%
Ratios/Supplemental Data:
Net Assets, End of Period (000's) .................. $ 193,314 $ 160,057 $164,340 $151,907 $117,548 $127,056
Ratios to average net assets:
Net investment income including
reimbursement/waiver .......................... 2.93%* 2.51% 2.85% 2.92% 2.78% 3.12%
Operating expenses including reimbursement/waiver 0.66%* 0.66% 0.67% 0.68% 0.68% 0.68%
Operating expenses excluding reimbursement/waiver 0.66%* 0.66% 0.67% 0.69% 0.69% 0.71%
-----------------------------------------------------------------------
<FN>
* Annualized.
** Not Annualized.
(1) Prior to November 1, 1994, the Fund offered a single series of shares. As
of such date, the existing series of shares was designated as Retail A
Shares and the Fund began issuing a second series of shares designated as
Trust 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, 2000 (unaudited) and the years ended October 31,
1999, 1998, 1997, 1996 and 1995 were $0.01, $0.02, $0.03, $0.03, $0.03 and
$0.03, 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, 2000 (unaudited) and
the years ended October 31, 1999, 1998, 1997, 1996 and 1995 were $0.02,
$0.03, $0.03, $0.03, $0.03 and $0.03, respectively.
</FN>
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
38
<PAGE>
<TABLE>
<CAPTION>
TRUST SHARES
SIX MONTHS ENDED
APRIL 30, 2000 YEARS ENDED OCTOBER 31,
-------------------------------------------------
(UNAUDITED) 1999 1998 1997
------------- -------------- ------------- --------------
<S> <C> <C> <C> <C>
Net Asset Value, Beginning of Period ............... $ 1.00 $ 1.00 $ 1.00 $ 1.00
------------- -------------- ------------- --------------
Income from Investment Operations:
Net investment income (A) ....................... 0.02 0.03 0.03 0.03
------------- -------------- ------------- --------------
Less Dividends:
Dividends from net investment income ............ (0.02) (0.03) (0.03) (0.03)
------------- -------------- ------------- --------------
Net increase (decrease) in net asset value ......... -- -- -- --
------------- -------------- ------------- --------------
Net Asset Value, End of Period ..................... $ 1.00 $ 1.00 $ 1.00 $ 1.00
============= ============== ============= ==============
Total Return ....................................... 1.54%** 2.67% 3.03% 3.10%
Ratios/Supplemental Data:
Net Assets, End of Period (000's) .................. $ 389,706 $ 556,137 $ 227,176 $ 169,316
Ratios to average net assets:
Net investment income including
reimbursement/waiver .......................... 3.06%* 2.65% 2.99% 3.05%
Operating expenses including reimbursement/waiver 0.53%* 0.52% 0.53% 0.53%
Operating expenses excluding reimbursement/waiver 0.53%* 0.52% 0.53% 0.53%
-----------------------------------------------------------------------
<FN>
* Annualized.
** Not Annualized.
(1) Prior to November 1, 1994, the Fund offered a single series of shares. As
of such date, the existing series of shares was designated as Retail A
Shares and the Fund began issuing a second series of shares designated as
Trust 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, 2000 (unaudited) and the years ended October 31,
1999, 1998, 1997, 1996 and 1995 were $0.01, $0.02, $0.03, $0.03, $0.03 and
$0.03, 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, 2000 (unaudited) and
the years ended October 31, 1999, 1998, 1997, 1996 and 1995 were $0.02,
$0.03, $0.03, $0.03, $0.03 and $0.03, respectively.
</FN>
</TABLE>
<TABLE>
<CAPTION>
YEARS ENDED OCTOBER 31,
--------------------------------
1996 1995(1)
------------- -------------
<S> <C> <C>
Net Asset Value, Beginning of Period ............... $ 1.00 $ 1.00
------------- -------------
Income from Investment Operations:
Net investment income (A) ....................... 0.03 0.03
------------- -------------
Less Dividends:
Dividends from net investment income ............ (0.03) (0.03)
------------- -------------
Net increase (decrease) in net asset value ......... -- --
------------- -------------
Net Asset Value, End of Period ..................... $ 1.00 $ 1.00
============= =============
Total Return ....................................... 2.97% 3.29%
Ratios/Supplemental Data:
Net Assets, End of Period (000's) .................. $ 184,307 $ 180,706
Ratios to average net assets:
Net investment income including
reimbursement/waiver .......................... 2.92% 3.24%
Operating expenses including reimbursement/waiver 0.54% 0.55%
Operating expenses excluding reimbursement/waiver 0.54% 0.56%
-----------------------------------------------------------------------
<FN>
* Annualized.
** Not Annualized.
(1) Prior to November 1, 1994, the Fund offered a single series of shares. As
of such date, the existing series of shares was designated as Retail A
Shares and the Fund began issuing a second series of shares designated as
Trust 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, 2000 (unaudited) and the years ended October 31,
1999, 1998, 1997, 1996 and 1995 were $0.01, $0.02, $0.03, $0.03, $0.03 and
$0.03, 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, 2000 (unaudited) and
the years ended October 31, 1999, 1998, 1997, 1996 and 1995 were $0.02,
$0.03, $0.03, $0.03, $0.03 and $0.03, respectively.
</FN>
</TABLE>
39
<PAGE>
U.S. TREASURY FUND
FINANCIAL HIGHLIGHTS
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
RETAIL A SHARES
SIX MONTHS ENDED
APRIL 30, 2000 YEARS ENDED OCTOBER 31,
------------------------------------------------------------------
(UNAUDITED) 1999 1998 1997 1996 1995
----------- ----------- ----------- ----------- ----------- ------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period........ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
----------- ----------- ----------- ----------- ----------- ------------
Income from Investment Operations:
Net investment income (A)................ 0.02 0.04 0.05 0.05 0.05 0.05
----------- ----------- ----------- ----------- ----------- ------------
Less Dividends:
Dividends from net investment income..... (0.02) (0.04) (0.05) (0.05) (0.05) (0.05)
----------- ----------- ----------- ----------- ----------- ------------
Net increase (decrease) in net asset value.. -- -- -- -- -- --
----------- ----------- ----------- ----------- ----------- ------------
Net Asset Value, End of Period.............. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
=========== =========== =========== =========== =========== ============
Total Return ............................... 2.41%** 4.14% 4.73% 4.67% 4.63% 4.99%
Ratios/Supplemental Data:
Net Assets, End of Period (000's)........... $ 607,745 $ 584,364 $ 559,053 $ 585,969 $ 443,230 $ 318,621
Ratios to average net assets:
Net investment income including
reimbursement/waiver................... 4.79%* 4.06% 4.63% 4.58% 4.53% 4.90%
Operating expenses including reimbursement/waiver 0.66%* 0.67% 0.68% 0.69% 0.69% 0.73%
Operating expenses excluding reimbursement/waiver 0.66%* 0.67% 0.68% 0.70% 0.69% 0.73%
---------------------------------------------------------------------------
<FN>
* Annualized.
** Not Annualized.
(1) Prior to November 1, 1994, the Fund offered a single series of shares. As
of such date, the existing series of shares was designated as Retail A
Shares and the Fund began issuing a second series of shares designated as
Trust 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, 2000 (unaudited) and the years ended October 31,
1999, 1998, 1997, 1996, and 1995 were $0.02, $0.04, $0.05, $0.05, $0.05 and
$0.05, 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, 2000 (unaudited) and
the years ended October 31, 1999, 1998, 1997, 1996 and 1995 were $0.02,
$0.04, $0.05, $0.05, $0.05 and $0.05, respectively.
</FN>
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
40
<PAGE>
<TABLE>
<CAPTION>
TRUST SHARES
SIX MONTHS ENDED
APRIL 30, 2000 YEARS ENDED OCTOBER 31,
-----------------------------------------------------------
(UNAUDITED) 1999 1998 1997 1996 1995(1)
----------- -------- -------- --------- --------- ----------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period........ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
--------- -------- --------- --------- --------- ----------
Income from Investment Operations:
Net investment income (A)................ 0.02 0.04 0.05 0.05 0.05 0.05
--------- -------- --------- --------- --------- ----------
Less Dividends:
Dividends from net investment income..... (0.02) (0.04) (0.05) (0.05) (0.05) (0.05)
--------- -------- --------- --------- --------- ----------
Net increase (decrease) in net asset value.. -- -- -- -- -- --
--------- -------- --------- --------- --------- ----------
Net Asset Value, End of Period.............. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
========= ======== ========= ========= ========= ==========
Total Return ............................... 2.48%** 4.30% 4.90% 4.85% 4.80% 5.18%
Ratios/Supplemental Data:
Net Assets, End of Period (000's)........... $ 476,980 $ 459,792 $ 429,645 $ 393,175 $ 354,331 $ 271,036
Ratios to average net assets:
Net investment income including
reimbursement/waiver................... 4.94%* 4.22% 4.80% 4.75% 4.69% 5.06%
Operating expenses including reimbursement/waiver 0.51%* 0.51% 0.51% 0.52% 0.53% 0.55%
Operating expenses excluding reimbursement/waiver 0.51%* 0.51% 0.51% 0.53% 0.53% 0.55
---------------------------------------------------------------------------
<FN>
* Annualized.
** Not Annualized.
(1) Prior to November 1, 1994, the Fund offered a single series of shares. As
of such date, the existing series of shares was designated as Retail A
Shares and the Fund began issuing a second series of shares designated as
Trust 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, 2000 (unaudited) and the years ended October 31,
1999, 1998, 1997, 1996, and 1995 were $0.02, $0.04, $0.05, $0.05, $0.05 and
$0.05, 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, 2000 (unaudited) and
the years ended October 31, 1999, 1998, 1997, 1996 and 1995 were $0.02,
$0.04, $0.05, $0.05, $0.05 and $0.05, respectively.
</FN>
</TABLE>
41
<PAGE>
CONNECTICUT MUNICIPAL MONEY MARKET FUND
FINANCIAL HIGHLIGHTS
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
SIX MONTHS ENDED
APRIL 30, 2000 YEAR ENDED OCTOBER 31,
-------------------------------------------------------------------
(UNAUDITED) 1999 1998 1997 1996
------------- -------------- --------------- --------------- -----------------
RETAIL A SHARES RETAIL A SHARES RETAIL A SHARES RETAIL A SHARES RETAIL A SHARES(1)
--------------- --------------- --------------- --------------- -----------------
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period ....... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
------------- --------------- --------------- --------------- -----------------
Income from Investment Operations:
Net investment income (A) ............... 0.01 0.02 0.03 0.03 0.03
------------- --------------- --------------- --------------- -----------------
Less Dividends:
Dividends from net investment income .... (0.01) (0.02) (0.03) (0.03) (0.03)
------------- --------------- --------------- --------------- -----------------
Net increase (decrease) in net asset value . -- -- -- -- --
------------- --------------- --------------- --------------- -----------------
Net Asset Value, End of Period ............. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
============= =============== =============== =============== =================
Total Return (B) .......................... 1.44%** 2.47% 2.87% 2.94% 2.83%
Ratios/Supplemental Data:
Net Assets, End of Period (000's) .......... $ 260,312 $ 243,051 $ 165,186 $ 137,095 $ 110,544
Ratios to average net assets:
Net investment income
including reimbursement/waiver ........ 2.87%* 2.44% 2.83% 2.91% 2.79%
Operating expenses
including reimbursement/waiver ........ 0.62%* 0.62% 0.62% 0.60% 0.64&
Operating expenses
excluding reimbursement/waiver ........ 0.65%* 0.65% 0.65% 0.65% 0.73%
-----------------------------------------------------------------------------------------------------------------------
<FN>
* Annualized.
** Not Annualized.
(1) The Fund commenced operations on October 4, 1993 as a separate investment
portfolio (the "Predecessor Fund") of the Shawmut Funds. On December 4,
1995, the Predecessor Fund was reorganized as a new portfolio of the Trust
with a single series of shares. Prior to the reorganization, the
Predecessor Fund offered two series of shares, Investment Shares and Trust
Shares. In connection with the reorganization, the shareholders of the
Predecessor Fund exchanged shares of the two series for a single series of
shares in the Galaxy Connecticut Municipal Money Market Fund.
(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, 2000 (unaudited) and the years ended October 31,
1999, 1998, 1997 and 1996 were $0.01, $0.02, $0.03, $0.03 and $0.03,
respectively. Net investment income per share before reimbursement/waiver
of fees by the Investment Advisor and/or other parties for Investment
Shares for the year ended October 31, 1995 was $0.03 (unaudited). Net
investment income per share before reimbursement/waiver of fees by the
Investment Advisor and/or other parties for Trust Shares for the year ended
October 31, 1995 was $0.02 (unaudited).
(B) Calculation does not include the effect of any sales charge for Investment
Shares of the Predecessor Fund.
</FN>
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
42
<PAGE>
<TABLE>
<CAPTION>
Year ended October 31,
-------------------------------
1995
-------------------------------
Investment Trust
Shares Shares
------------- --------------
<S> <C> <C>
Net Asset Value, Beginning of Period ......... $ 1.00 $ 1.00
------------- --------------
Income from Investment Operations:
Net investment income (A) ................. 0.03 0.03
------------- --------------
Less Dividends:
Dividends from net investment income ...... (0.03) (0.03)
------------- --------------
Net increase (decrease) in net asset value ... -- --
------------- --------------
Net Asset Value, End of Period ............... $ 1.00 $ 1.00
============= ==============
Total Return (B) ............................ 2.94% 3.19%
Ratios/Supplemental Data:
Net Assets, End of Period (000's) ............ $ 71,472 $ 31,164
Ratios to average net assets:
Net investment income
including reimbursement/waiver .......... 2.88% 3.14%
Operating expenses
including reimbursement/waiver .......... 0.82% 0.57%
Operating expenses
excluding reimbursement/waiver .......... 1.29% 0.79%
-----------------------------------------------------------------------------------------------------------------------
<FN>
* Annualized.
** Not Annualized.
(1) The Fund commenced operations on October 4, 1993 as a separate investment
portfolio (the "Predecessor Fund") of the Shawmut Funds. On December 4,
1995, the Predecessor Fund was reorganized as a new portfolio of the Trust
with a single series of shares. Prior to the reorganization, the
Predecessor Fund offered two series of shares, Investment Shares and Trust
Shares. In connection with the reorganization, the shareholders of the
Predecessor Fund exchanged shares of the two series for a single series of
shares in the Galaxy Connecticut Municipal Money Market Fund.
(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, 2000 (unaudited) and the years ended October 31,
1999, 1998, 1997 and 1996 were $0.01, $0.02, $0.03, $0.03 and $0.03,
respectively. Net investment income per share before reimbursement/waiver
of fees by the Investment Advisor and/or other parties for Investment
Shares for the year ended October 31, 1995 was $0.03 (unaudited). Net
investment income per share before reimbursement/waiver of fees by the
Investment Advisor and/or other parties for Trust Shares for the year ended
October 31, 1995 was $0.02 (unaudited).
(B) Calculation does not include the effect of any sales charge for Investment
Shares of the Predecessor Fund.
</FN>
</TABLE>
43
<PAGE>
MASSACHUSETTS MUNICIPAL MONEY MARKET FUND
FINANCIAL HIGHLIGHTS
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
RETAIL A SHARES
SIX MONTHS ENDED
APRIL 30, 2000 YEARS ENDED OCTOBER 31,
------------------------------------------------------------------
(UNAUDITED) 1999 1998 1997 1996(1) 1995
----------- ----------- ----------- ----------- ----------- ------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period........ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
----------- ----------- ----------- ----------- ----------- ------------
Income from Investment Operations:
Net investment income (A)................ 0.01 0.02 0.03 0.03 0.03 0.03
----------- ----------- ----------- ----------- ----------- ------------
Less Dividends:
Dividends from net investment income..... (0.01) (0.02) (0.03) (0.03) (0.03) (0.03)
----------- ----------- ----------- ----------- ----------- ------------
Net increase (decrease) in net asset value. -- -- -- -- -- --
----------- ----------- ----------- ----------- ----------- ------------
Net Asset Value, End of Period.............. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
=========== =========== =========== =========== =========== ============
Total Return .............................. 1.46%** 2.50% 2.86% 2.92% 2.83% 3.21%
Ratios/Supplemental Data:
Net Assets, End of Period (000's)........... $ 259,396 $ 241,611 $ 127,922 $ 80,966 $ 47,066 $ 40,326
Ratios to average net assets:
Net investment income including
reimbursement/waiver................... 2.91%* 2.48% 2.81% 2.90% 2.78% 3.16%
Operating expenses including
reimbursement/waiver................... 0.62%* 0.62% 0.62% 0.61% 0.62% 0.57%
Operating expenses excluding
reimbursement/waiver................... 0.65%* 0.65% 0.68% 0.69% 0.83% 1.06%
----------------------------------------------------------------------
<FN>
* Annualized.
** Not Annualized.
(1) The Fund commenced operations on October 5, 1993 as a separate investment
portfolio (the "Predecessor Fund") of the Shawmut Funds. On December 4,
1995, the Predecessor Fund was reorganized as a new portfolio of the Trust.
(A) Net investment income per share before reimbursement/waiver of fees by the
Investment Advisor and/or other parties for the six months ended April 30,
2000 (unaudited) and the years ended October 31, 1999, 1998, 1997, 1996 and
1995 were $0.01, $0.02, $0.03, $0.03, $0.03 and $0.03 (unaudited),
respectively.
</FN>
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
44
<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, (the "1940 Act") 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 Money Market, Government,
Tax-Exempt, U.S. Treasury, Connecticut Municipal Money Market and Massachusetts
Municipal Money Market Funds (individually, a "Fund," collectively, the "Funds")
only.
The Money Market Fund is authorized to issue four series of shares (Trust
Shares, Retail A Shares, Retail B Shares and BKB Shares). The Government Fund is
authorized to issue two series of Shares (Trust Shares and Retail A Shares). The
U.S. Treasury and Tax-Exempt Funds are authorized to issue three series of
shares (Trust Shares, Retail A Shares and BKB Shares). The Connecticut Municipal
Money Market and Massachusetts Municipal Money Market Funds are authorized to
issue one series of shares (Retail A Shares). Trust Shares, Retail A Shares,
Retail B Shares and BKB Shares are substantially the same, except: (i) Retail B
Shares are subject to a maximum 5.00% contingent deferred sales charge, and (ii)
each series of shares bears the following series specific expenses: distribution
fees and/or shareholder servicing fees and transfer agency charges. Six years
after the date of purchase, Retail B Shares of the Money Market Fund will
automatically convert to Retail A Shares of such Fund. BKB Shares of the Money
Market, U.S. Treasury and Tax-Exempt Funds will convert to Retail A Shares of
the same Fund on the first anniversary of the closing of the reorganization of
the Boston 1784 Funds into the Trust provided that prior thereto the Board of
Trustees of the Trust has determined that such conversion is in the best
interest of the holders of such BKB Shares. No BKB Shares of the Money Market,
U.S. Treasury and Tax-Exempt Funds were issued prior to the date of this report.
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: Securities in the Funds are valued utilizing the
amortized cost valuation method permitted in accordance with Rule 2a-7 under the
1940 Act. This method involves valuing a portfolio security initially at its
cost and thereafter assuming a constant amortization to maturity of any discount
or premium.
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 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
outstanding shares of each series.
DIVIDENDS TO SHAREHOLDERS: Dividends from net investment income are
determined separately for each series of a Fund and are declared daily and paid
monthly. Net realized capital gains, if any, are distributed at least annually.
Income dividends and capital gain distributions 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 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.
REPURCHASE AGREEMENTS: Each Fund, except the U.S. Treasury Fund, may engage
in repurchase agreement transactions with institutions that the Trust's
investment advisor has determined are creditworthy. Each repurchase agreement
transaction is recorded at cost plus accrued interest. Each Fund requires that
the securities collateralizing a repurchase agreement transaction be transferred
to the Trust's custodian in a manner that is intended to enable the Fund to
obtain those securities in the event of a counterparty default. The value of the
collateral securities is monitored daily to ensure that the value of the
collateral, including accrued interest, equals or exceeds the repurchase price.
Repurchase agreement transactions involve certain risks in the event of default
or insolvency of the counterparty, including possible delays or restrictions
upon a Fund's ability to dispose of the underlying securities, and a possible
decline in the value of the underlying securities during the period while the
Fund seeks to assert its rights.
45
<PAGE>
NOTES TO FINANCIAL STATEMENTS
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 outstanding shares of each series. Operating expenses
directly attributable to a series of shares of a Fund are charged to the
operations of that series.
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 FleetBoston Financial
Corporation, are parties to an investment advisory agreement under which the
Investment Advisor provides services for a fee, computed daily and paid monthly,
at the following annual rates: with respect to the Money Market, Government and
Tax-Exempt Funds, 0.40% of the average daily net assets of each Fund, and with
respect to the U.S. Treasury, Connecticut Municipal Money Market and
Massachusetts Municipal Money Market Funds, 0.40% of the first $750,000,000 of
net assets of each Fund plus 0.35% of net assets of each Fund in excess of
$750,000,000. The Trust has been advised by the Investment Advisor that, with
respect to the Money Market, Government and Tax-Exempt Funds, the Investment
Advisor intends to waive advisory fees payable to it by each Fund by 0.05% to
the extent that a Fund's net assets exceed $750,000,000.
The Trust and PFPC Inc. (formerly known as First Data Investor Services
Group, Inc.), a member of PNC Financial Services Group (formerly known as
PNCBank Corp.), are parties to an administration agreement under which PFPC Inc.
(the "Administrator") provides services for a fee, computed daily and paid
monthly, at the annual rate 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 December 1, 1999,the services described above
were provided by First Data Investor Services Group,Inc., a wholly-owned
subsidiary of First Data Corp. On that date, PFPC Trust Co., a wholly-owned
subsidiary of PFPC Worldwide Inc., and an indirect wholly-owned subsidiary of
PNC Bank Corp., acquired all the outstanding stock of First Data Investor
Services Group, Inc. As part of that transaction, PFPC Inc., also an indirect
wholly-owned subsidiarly of PNC Bank Corp., was merged into First Data Investor
Services Group, Inc., which then changed its name to PFPC Inc.
In addition, PFPC Inc. also provides certain fund accounting, custody
administration and transfer agency services pursuant to certain fee
arrangements. In accordance with such fee arrangements, PFPC Inc. compensates
the Trust's custodian bank, The Chase Manhattan Bank, for its services.
Provident Distributors, Inc. (the "Distributor"), serves as the distributor
of the Trust's shares. Prior to December 1, 1999, First Data Distributors, Inc.,
a wholly-owned subsidiary of First Data Investor Services Group, Inc., acted as
exclusive distributor of the Trust's shares.
The Trust has adopted a shareholder services plan (the "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 0.25% 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 the Trustees, is
currently limiting fees payable under the Services Plan with respect to each
Fund to an aggregate annual rate not to exceed 0.10% of the average daily net
asset value of the outstanding Retail A Shares beneficially owned by such
customers.
The Trust has adopted a distribution and services plan (the "12b-1 Plan")
with respect to Retail B Shares of the Money Market 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
administrative support services are being made solely to Fleet Bank and its
affiliates. Payments for distribution expenses may not exceed an annual rate of
0.65% of the average daily net assets attributable to the Money Market Fund's
outstanding Retail B Shares. The fees paid for shareholder liaison and
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 Money
Market Fund's outstanding Retail B Shares owned of record or beneficially by
customers of institutions. The Trust is currently limiting the Money Market
Fund's
46
<PAGE>
NOTES TO FINANCIAL STATEMENTS
payments for shareholder liaison and administrative support services under the
12b-1 Plan to an aggregate fee of not more than 0.10% 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, 2000, the Funds paid fees under
the Services Plan and 12b-1 Plan as follows:
SERVICES 12B-1 PLAN
----------
FUND PLAN SERVICES DISTRIBUTION
---- -------- ------------
Money Market Fund ........ $ 1,187,139 $ 1,068 $ 7,564
Government Fund .......... 171,131 -- --
Tax-Exempt Fund .......... 82,067 -- --
U.S. Treasury Fund ....... 288,815 -- --
Connecticut Municipal
Money Market Fund ........ 125,460 -- --
Massachusetts Municipal
Money Market Fund ........ 124,424 -- --
The Trust has adopted a shareholder services plan (the "BKB Plan") with
respect to BKB Shares of the Money Market, U.S. Treasury and Tax-Exempt Funds.
The BKB Plan provides compensation to institutions (including Fleet Bank and its
affiliates) which provide administrative and support services to their customers
who beneficially own BKB Shares, at an aggregate annual rate not to exceed 0.25%
of the average daily net asset value of the outstanding BKB 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 BKB Plan with
respect to each Fund to an annual aggregate rate not to exceed 0.10% of the
average daily net asset value of the outstanding BKB Shares beneficially owned
by such customers. As of the date of this report, no payments have been made
under the BKB Plan.
The Retail A Shares, Retail B Shares, Trust Shares and BKB Shares of a Fund
bear series specific transfer agent charges based upon the number of shareholder
accounts for each series. Trust Shares of the Funds (except the Tax-Exempt Fund)
also bear additional transfer agency fees in order to compensate PFPC Inc. for
payments made to Fleet Bank, an affiliate of the Investment Advisor, for
performing certain sub-account and administrative functions on a per account
basis with respect to Trust Shares held by defined contribution plans. These
additional fees are based on the number of underlying participant accounts. For
the six months ended April 30 2000, transfer agent charges for each series,
(other than BKB Shares which had not been issued prior to the date of this
report), were as follows:
FUND RETAIL A RETAIL B TRUST
-------- -------- -----
Money Market Fund ........ $ 955,319 $ 2,610 $ 75,142
Government Fund .......... 129,488 -- 36,424
Tax-Exempt Fund .......... 22,044 -- --
U.S. Treasury Fund ....... 159,097 -- 9,596
Connecticut Municipal
Money Market Fund ........ 12,522 -- --
Massachusetts Municipal
Money Market Fund ........ 10,340 -- --
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. 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 $45,000 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, 2000 include legal fees paid to
Drinker Biddle & Reath LLP. A partner of that firm is Secretary of the Trust.
4. WAIVER OF FEES AND REIMBURSEMENT OF EXPENSES
The Investment Advisor and/or its affiliates voluntarily agreed to waive a
portion of its fees and/or reimburse the Funds for certain expenses so that
total expenses would not exceed certain expense limitations established for each
Fund. The InvestmentAdvisor and/or its affiliates, at their discretion, may
revise or discontinue the voluntary fee waivers and/or expense reimbursements at
any time. For six months ended April 30, 2000, the Investment Advisor and/or its
affiliates waived fees and/or reimbursed expenses with respect to the Funds in
the following amounts:
FEES WAIVED BY
FUND INVESTMENT ADVISOR
---- ------------------
Money Market Fund ........ $ 870,645
Government Fund .......... 48,863
EXPENSES REIMBURSED BY
FUND INVESTMENT ADVISOR AND/OR ITS AFFILIATES
---- ----------------------------------------
Money Market Fund ........ $ 810
Connecticut Municipal
Money Market Fund ........ 31,226
Massachusetts Municipal
Money Market Fund ........ 31,446
47
<PAGE>
NOTES TO FINANCIAL STATEMENTS
5. CAPITAL CONTRIBUTION
On October 28, 1999, the Investment Advisor voluntarily contributed capital
to the Money Market Fund, Government Fund and U.S. Treasury Fund in the amounts
of approximately $1.3 million, $806,000 and $736,000, respectively. These
amounts were contributed to offset losses realized on the sale of certain
securities which occured in 1994. The Investment Advisor received no shares of
beneficial interest or other consideration in exchange for these contributions
which increased the net asset value of each Fund.
6. SHARES OF BENEFICIAL INTEREST
The Trust's Declaration of Trust authorizes the Trustees to issue an
unlimited number of shares of beneficial interest in the Funds, each with a par
value of $0.001. The Trust's shares are classified into forty classes of shares,
each consisting of one or more series.
Each share represents an equal proportionate interest in the respective Fund,
bears the same fees and expenses (except that Retail A Shares of a Fund bear the
expense of payments under the Services Plan, Retail B Shares of a Fund bear the
expense of payments under the 12b-1 Plan, BKB Shares of a Fund bear the expense
of payments under the BKB Plan and Retail A Shares, Retail B Shares, Trust
Shares and BKBShares of a Fund 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 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.
7. CONCENTRATION OF CREDIT
The Connecticut Municipal Money Market and Massachusetts Municipal Money
Market Funds invest primarily in debt obligations issued by the State of
Connecticut and the Commonwealth of Massachusetts, respectively, and their
respective political subdivisions, agencies and public authorities to obtain
funds for various public purposes. Such Funds are more susceptible to economic
and political factors adversely affecting issuers of each respective state's
specific municipal securities than are municipal funds that are not concentrated
in these issuers to the same extent.
8. FEDERAL TAX INFORMATION
At October 31, 1999, the following Funds had capital loss carryforwards:
Fund Amount Expiration
------------- --------- ----------
Tax-Exempt Fund .......... $ 120,301 2002
3,772 2003
7,498 2004
Connecticut Municipal
Money Market Fund ........ 6,619 2002
817 2004
Massachusetts Municipal
Money Market Fund ........ 133 2001
31 2002
12,416 2004
48
<PAGE>
[GRAPHIC OMITTED]
GALAXY
FUNDS
4400 COMPUTER DRIVE
P.O. BOX 5108
WESTBOROUGH, MA 01581-5108
SAMM(7/1/00)
