Semiannual Report
Georgia
Tax-Free
Bond Fund
August 31, 1997
T. Rowe Price
Report Highlights
Georgia Tax-Free Bond Fund
o The environment for bonds was generally favorable during
the six months ended August 31, 1997, as the Federal
Reserve held the line after raising rates in March.
o Georgia's economy remained healthy, although growth slowed
as expected with the winding down of Olympic-related
activities.
o The fund provided a solid return for the period, exceeding
its Lipper peer group average.
o As the period advanced, we modified our initially cautious
stance to take fuller advantage of the bond rally; in
August, we again pulled back a bit as rates reversed.
o Despite strong economic growth, we believe the environment
is still favorable for fixed income investors due to low
inflation and fiscal restraint.
Fellow Shareholders
The municipal bond market and your fund provided solid returns
during the six months ended August 31 as long-term interest
rates declined on balance. Strong economic growth continued into
the first quarter of 1997, and, in March, the Federal Reserve
raised the federal funds rate a quarter-point to 5.50%. With
inflation remaining subdued, the Fed subsequently has left rates
unchanged, creating a generally favorable environment for bonds.
Market Environment
Interest rates fluctuated as the market wrestled with a
conflicting combination of strong economic growth and declining
inflation. Both money market and longer-term bond yields began
rising before the March rate hike and continued to rise for a
short time afterward in anticipation of further tightening.
However, excellent news on inflation, progress on controlling
the federal budget deficit, and little evidence of wage
pressures diminished fears of further rate increases. Short-term
taxable rates subsequently fell in mid-April to their earlier
levels. Long-term taxable bond yields also began to fall in the
late spring after climbing to more than 7% in April. The 30-year
Treasury bond yield averaged just over 6.50% in July and August
and 6.80% for the past six months, almost identical to its
average over the two preceding years.
Georgia Bond Yield Index: 1-line chart showing the T. Rowe Price
index of Georgia bond yields from 8/31/96 to 8/31/97
8/31/96 5.89
9/96 5.71
10/96 5.67
11/30 5.53
12/96 5.62
1/97 5.75
2/28 5.66
3/97 5.77
4/97 5.76
5/31 5.62
6/97 5.58
7/97 5.34
8/97 5.44
Long-term municipal interest rates, including yields on Georgia
bonds, followed a similar pattern, rising in March, peaking in
April, then falling in late June and July when preliminary data
signaled a slowdown. Rates reversed in August as
stronger-than-expected economic data changed the outlook for the
third quarter. Municipal bonds outperformed Treasuries
throughout most of the period except for June. The yield on
long-term AAA general obligation (GO) bonds began the six-month
period at 5.50% and ranged between 5.75% and 5.15% before
settling at 5.35% at the end of August. Five-year AAA GO yields
were 4.40% six months ago and finished at 4.35%, while one-year
notes ended higher at 3.85%, up from 3.70% last February.
Overall, both the municipal and Treasury yield curves flattened
as short-term rates rose modestly in anticipation of further Fed
tightening and long-term rates trended lower on positive
inflation news.
Georgia's economy continued to expand, although at a somewhat
slower pace than before the 1996 summer Olympics. As expected,
construction and tourism-related activity decreased, but this
was offset by increases in the transportation and services
sectors. Personal income growth continued to outpace that of the
nation, even though the unemployment rate rose slightly from
4.3% at the end of 1996 to 4.8%. The state remains fundamentally
strong, and we look for modest growth through the remainder of
the year.
In July, Standard & Poor's upgraded the state's credit rating to
AAA...
Georgia's financial health also remained sound, evidenced by the
operating surplus for fiscal 1996. With the winding down of
Olympic-related activity and the elimination of the state sales
tax on food, weaker revenue growth was expected for 1997, but so
far revenues have exceeded projections. In July, Standard &
Poor's upgraded the state's credit rating to AAA, making Georgia
one of only eight states rated triple-A by all three major
rating agencies. S&P also upgraded Cobb and Gwinnett Counties to
AAA, reflecting their rapid growth, strong finances, and modest
debt levels. Earlier this year, many Georgia school districts
approved a 1% local sales tax for school construction and other
expenses. While this additional revenue source is welcome, state
and local governments will continue to be challenged by funding
needs arising from the state's above-average growth.
Performance and Strategy Review
Your fund's returns of 4.12% and 9.01% for the 6- and 12-month
periods, respectively, surpassed those of the average Georgia
bond fund, as shown in the table on the next page. Returns for
each period reflected both income and a rise in the fund's share
price.
Performance Comparison
Periods Ended 8/31/97 6 Months 12 Months
_________________________________________________________
Georgia Tax-Free
Bond Fund 4.12% 9.01%
Lipper Georgia Municipal
Debt Funds Average 4.04 8.79
At the outset of the period, we were cautious on interest rates
and had sought to minimize the impact of rising rates by
reducing duration and weighted average maturity to 7.8 years and
15.9 years, respectively. (Duration measures a fund's
sensitivity to interest rate changes. For instance, a duration
of seven years tells you that the fund's price would fall or
rise about 7% in response to a one-percentage-point increase or
decrease in interest levels.) By late spring, however, it became
increasingly unlikely that the Fed would tighten further, and
rates began to decline. To participate more fully in the bond
market rally, we directed new cash flow to the long end of the
market and also extended the fund's duration to 8.5 years and
weighted average maturity to over 17.0 years. The market's
abrupt reversal in August set us back a bit, and by month-end we
had trimmed duration so that it was only modestly longer than in
March. Nonetheless, our more aggressive stance for some of the
period served shareholders well on balance by enhancing the
fund's overall return.
As in the past, we continued to emphasize general obligation
bonds and other tax-supported debt in our investment strategy.
The strength of the economy in Georgia underpins these credits,
and passage of the 1% sales tax in many localities provides
additional flexibility and strength for bond issuers. Toward the
end of August, we temporarily reduced our position in local
general obligations by taking profits on several holdings that
had appreciated significantly compared with the overall market.
We expect to rebuild our position in local GOs going forward.
For the past year or more, we have watched long-term AAA
municipal yields generally trade in a range of 5.25% to 6.00%.
We expect this range to hold-barring overwhelming evidence of
strong economic growth and persistent inflation-and plan to make
any adjustments to the fund's duration with this range in mind.
We have found this trading range to be especially applicable for
long-term Georgia tax-exempt bonds because the state's strong
economy generates consistent investment demand for tax-exempt
securities at these yield levels.
Outlook
Given the high level of consumer and business confidence, we
expect the economy to continue to perform well, although not
quite as well as in the first half of the year. The Federal
Reserve has expressed uncertainty about why inflation has
remained so low at this stage of the expansion and is
maintaining a bias toward tightening in an effort to keep
inflation in check. Until visible signs of accelerating
inflation appear, there is little reason for us to be defensive,
and we believe the overall environment for fixed income
securities is still favorable. On the other hand, with long-term
municipal yields nearer the low end of the yield range (AAA
rated bonds are currently at 5.30%), we are cautious on interest
rates near term and have adopted a neutral posture for the fund.
We are focusing our efforts on preserving high tax-exempt income
consistent with prudent duration management and security
selection. As always, we will be closely monitoring developments
in the national economy and their impact on the Georgia
municipal market.
Respectfully submitted,
Hugh D. McGuirk
Chairman of the Investment Advisory Committee
September 22, 1997
T. Rowe Price Georgia Tax-Free Bond Fund
Portfolio Highlights
2/28/97 8/31/97
_______________________________________________________________________
Price Per Share $10.44 $ 10.61
Dividends Per Share
For 6 months 0.26 0.25
For 12 months 0.52 0.51
Dividend Yield *
For 6 months 5.04% 4.89%
For 12 months 5.13 5.03
Weighted Average Maturity (years) 16.0 16.5
Weighted Average Effective Duration (years) 7.8 8.0
Weighted Average Quality ** AA- AA-
* Dividends earned and reinvested for the periods indicated are
annualized and divided by the average daily net asset values per share
for the same period.
** Based on T. Rowe Price research.
T. Rowe Price Georgia Tax-Free Bond Fund
Portfolio Highlights
SECTOR Diversification
Percent of Percent of
Net Assets Net Assets
2/28/97 8/31/97
______________________________________________________________________
General Obligation - Local 22% 14%
Water and Sewer Revenue 8 14
Nuclear Revenue 13 12
Housing Finance Revenue 9 10
Dedicated Tax Revenue 6 10
Prerefunded Bonds 8 8
General Obligation - State 4 6
Escrowed to Maturity 4 5
Industrial and Pollution Control Revenue 6 5
Educational Revenue 1 4
Hospital Revenue 10 3
Lease Revenue 3 3
Miscellaneous Revenue 1 2
All Other 5 3
Other Assets Less Liabilities - 1
_______________________________________________________________________
Total 100% 100%
T. Rowe Price Georgia Tax-Free Bond Fund
Performance Comparison
This chart shows the value of a hypothetical $10,000 investment in the fund
over the past 10 fiscal year periods or since inception (for funds lacking
10-year records). The result is compared with a broad-based average or index.
The index return does not reflect expenses, which have been deducted from the
fund's return.
Georgia Tax-Free Bond Fund SEC chart
Lipper Georgia T. Rowe Price
Lehman Municipal Municipal Debt Georgia Tax-Free
Bond Index Funds Average Bond Fund
3/31/93 $ 10,000 $ 10,000 $10,000
8/93 10,556 10,645 10,712
8/94 10,571 10,532 10,627
8/95 11,508 11,312 11,482
8/96 12,111 11,895 12,219
8/97 $ 13,230 $ 12,966 $13,320
Average Annual Compound Total Return
This table shows how the fund would have performed each year if its actual
(or cumulative) returns for the periods shown had been earned at a constant
rate.
SinceInception
Periods Ended 8/31/971 Year 3 Years Inception Date
___________________________________________________________________
Georgia Tax-Free
Bond Fund 9.01% 7.82%6.70% 3/31/93
Investment return and principal value represent past performance and will
vary. Shares may be worth more or less at redemption than at original
purchase.
T. Rowe Price Georgia Tax-Free Bond Fund
Unaudited
Financial Highlights
For a share outstanding throughout each period
6 Months Year 3/31/93
Ended Ended through
8/31/97 2/28/97 2/29/96 2/28/952/28/94
NET ASSET VALUE
Beginning of period$ 10.44 $10.44 $ 9.93 $10.37 $ 10.00
Investment activities
Net investment
income 0.25* 0.52* 0.52* 0.51* 0.43*
Net realized
and unreal-
ized gain
(loss) 0.17 - 0.51 (0.39) 0.41
Total from
investment
activities 0.42 0.52 1.03 0.12 0.84
Distributions
Net investment
income (0.25) (0.52) (0.52) (0.51) (0.43)
Net realized gain - - - (0.05) (0.04)
Total distributions(0.25) (0.52) (0.52) (0.56) (0.47)
NET ASSET VALUE
End of period $10.61 $10.44 $10.44 $ 9.93 $ 10.37
Ratios/Supplemental Data
Total return 4.12%* 5.15%* 10.62%* 1.42%* 8.45%*
Ratio of expenses to
average net assets 0.65%*! 0.65%* 0.65%* 0.65%* 0.65%*!
Ratio of net investment
income to average
net assets 4.84%*! 5.01%* 5.09%* 5.26%* 4.48%*!
Portfolio turnover
rate 47.2%! 71.1% 71.5% 170.2% 154.8%!
Net assets,
end of period
(in thousands) $ 43,605 $38,726 $32,500 $23,338$22,614
* Excludes expenses in excess of a 0.65% voluntary expense limitation in
effect through 2/28/99.
! Annualized.
The accompanying notes are an integral part of these financial statements.
T. Rowe Price Georgia Tax-Free Bond Fund
Unaudited
August 31, 1997
Statement of Net Assets
Par Value
In thousands
GEORGIA 91.0%
Atlanta, Airport Fac., 6.50%,
1/1/13 (FGIC Insured) * $ 500 $ 532
Atlanta Special Purpose Fac.,
Delta Airlines, 7.90%, 12/1/18 * 135 145
Burke County Dev. Auth., PCR
Georgia Power, VRDN (Currently 3.75%) 1,900 1,900
Oglethorpe Power, 7.80%, 1/1/08
(MBIA Insured) 560 660
Cartersville Dev. Auth., PCR, Anheuser
Busch, 6.75%, 2/1/12 * 1,000 1,082
Chatham County School Dist., GO
6.25%, 8/1/16 (Prerefunded 8/1/03!) 625 690
6.75%, 8/1/18 (MBIA Insured)
(Prerefunded 8/1/03!) 750 848
Cherokee County Water and Sewage Auth.
5.50%, 8/1/23 (MBIA Insured) 1,000 1,024
Clarke County Hosp. Auth., Athens
Regional Medical Center
5.00%, 1/1/22 (MBIA Insured) 1,000 932
Cobb-Marietta Coliseum and Exhibition
Hall Auth.
5.50%, 10/1/18 (MBIA Insured) 400 409
Coffee County Hosp. Auth., Coffee
Regional Medical Center
6.25%, 12/1/06 500 498
Coweta County Residential Care Fac.
for the Elderly Auth.
Wesley Woods of Newnan-Peachtree City
8.25%, 10/1/26 500 575
DeKalb County Dev. Auth., Emory Univ.,
6.00%, 10/1/14 550 579
Fulton County Dev. Auth., PCR, Special
Fac., Delta Airlines
6.95%, 11/1/12 500 544
Fulton County Housing Auth., Single Family
6.55%, 3/1/18 (GNMA Guaranteed) * 185 194
Fulton County School Dist., GO,
6.375%, 5/1/17 700 793
Fulton County Water and Sewage
6.25%, 1/1/09 (FGIC Insured) 1,000 1,117
6.375%, 1/1/14 (FGIC Insured) 500 566
Gainesville Water and Sewage, 6.00%,
11/15/12 (FGIC Insured) 1,000 1,098
Georgia, GO, 6.30%, 3/1/08 1,300 1,464
Georgia Housing and Fin. Auth.
Home Ownership, 6.60%, 6/1/25 * 250 262
Georgia Housing and Fin. Auth.
Single Family Mortgage
5.75%, 12/1/07 (FHA Guaranteed) * $ 100 $ 104
6.05%, 12/1/16 * 500 516
6.125%, 12/1/15 500 523
6.25%, 12/1/28 * 500 520
6.50%, 12/1/17 (FHA Guaranteed) * 1,000 1,045
6.60%, 12/1/23 (FHA Guaranteed) * 520 545
6.65%, 12/1/20 * 480 506
Georgia Municipal Gas Auth.,
Southern Storage Gas
6.00%, 7/1/04 500 536
Georgia Private Colleges and Univ. Auth.,
Emory Univ.
5.125%, 11/1/27 1,000 956
Gwinnett County Water and Sewer Auth.,
5.25%, 8/1/18 600 592
Hall County School Dist., GO
6.30%, 12/1/07 (AMBAC Insured) 1,000 1,108
Jackson County School Dist., GO
6.00%, 7/1/14 (MBIA Insured) 1,000 1,052
Metropolitan Atlanta Rapid Transit Auth.
Sales Tax
5.50%, 7/1/17 (MBIA Insured) 1,000 1,011
6.25%, 7/1/20 (AMBAC Insured) 525 588
6.90%, 7/1/20 (MBIA Insured)
(Prerefunded 7/1/04!) 1,300 1,493
7.00%, 7/1/11 (Escrowed to Maturity) 1,335 1,586
7.00%, 7/1/11 (MBIA Insured)
(Escrowed to Maturity) 635 755
Milledgeville, Water and Sewer, 6.00%,
12/1/21 (FSA Insured) 500 545
Monroe County Dev. Auth., PCR,
Georgia Power
3.75%, 7/1/25 200 200
Municipal Electric Auth. of Georgia
Zero Coupon, 1/1/09 310 161
5.70%, 1/1/19 (MBIA Insured) 300 311
6.25%, 1/1/12 (FGIC Insured) 1,000 1,113
6.50%, 1/1/12 325 363
7.25%, 1/1/24 (AMBAC Insured) 1,000 1,265
Paulding County, Water and Sewer
6.00%, 12/1/13 (MBIA Insured) 1,000 1,095
Paulding County School Dist., GO
6.00%, 2/1/13 (MBIA Insured) $ 1,000 $ 1,092
Peach County School Dist., GO
6.40%, 2/1/19 (MBIA Insured) 500 549
6.50%, 2/1/07 (MBIA Insured) 300 340
Rockdale County Dev. Auth., Solid
Waste Disposal, Visy Paper
7.40%, 1/1/16 * 490 524
Rockdale County School Dist., GO,
6.50%, 1/1/09 1,000 1,108
Savannah Economic Dev. Auth.,
Union Camp, 6.15%, 3/1/17 500 539
Smyrna Downtown Dev. Auth., 6.70%,
2/1/20 (MBIA Insured) 1,000 1,123
Total Georgia (Cost $37,557) 39,676
PUERTO RICO 8.1%
Puerto Rico Highway and Transportation Auth.
5.50%, 7/1/26 1,000 984
6.625%, 7/1/12 (FSA Insured) 1,000 1,094
Puerto Rico Infrastructure Fin. Auth.,
7.50%, 7/1/09 500 525
Puerto Rico Public Building Auth.,
GO, Gov't. Fac.
5.00%, 7/1/27 (AMBAC Insured) 1,000 944
Total Puerto Rico (Cost $3,456) 3,547
Total Investments in Securities
99.1% of Net Assets (Cost $41,013) $ 43,223
Other Assets Less Liabilities 382
NET ASSETS $ 43,605
_________
Net Assets Consist of:
Accumulated net investment income -
net of distributions $ 1
Accumulated net realized gain/loss -
net of distributions (908)
Net unrealized gain (loss) 2,210
Paid-in-capital applicable to 4,107,825
no par value shares of beneficial
interest outstanding; unlimited number
of shares authorized 42,302
NET ASSETS $ 43,605
_________
NET ASSET VALUE PER SHARE $ 10.61
__________
* Interest subject to alternative minimum tax
! Used in determining portfolio maturity
AMBAC AMBAC Indemnity Corp.
FGIC Financial Guaranty Insurance Company
FHA Federal Housing Authority
FSA Financial Security Assurance Corp.
GNMA Government National Mortgage Association
GO General Obligation
MBIA Municipal Bond Investors Assurance Corp.
PCR Pollution Control Revenue
VRDN Variable Rate Demand Note
The accompanying notes are an integral part of these financial statements.
T. Rowe Price Georgia Tax-Free Bond Fund
Unaudited
Statement of Operations
In thousands
6 Months
Ended
8/31/97
Investment Income
Interest income $ 1,137
Expenses
Custody and accounting 44
Investment management 42
Shareholder servicing 27
Prospectus and shareholder reports 9
Registration 4
Legal and audit 4
Trustees 3
Miscellaneous 2
Total expenses 135
Net investment income 1,002
Realized and Unrealized Gain (Loss)
Net realized gain (loss)
Securities 134
Futures (45)
Net realized gain (loss) 89
Change in net unrealized gain or loss on securities 627
Net realized and unrealized gain (loss) 716
INCREASE (DECREASE) IN NET
ASSETS FROM OPERATIONS $ 1,718
_________
The accompanying notes are an integral part of these financial statements.
T. Rowe Price Georgia Tax-Free Bond Fund
Unaudited
Statement of Changes in Net Assets
In thousands
6 Months Year
Ended Ended
8/31/97 2/28/97
Increase (Decrease) in Net Assets
Operations
Net investment income $ 1,002 $ 1,734
Net realized gain (loss) 89 170
Change in net unrealized gain or loss 627 (99)
Increase (decrease) in net assets
from operations 1,718 1,805
Distributions to shareholders
Net investment income (1,002) (1,734)
Capital share transactions*
Shares sold 6,997 10,973
Distributions reinvested 748 1,312
Shares redeemed (3,582) (6,130)
Increase (decrease) in net
assets from capital
share transactions 4,163 6,155
Net Assets
Increase (decrease) during period 4,879 6,226
Beginning of period 38,726 32,500
End of period $ 43,605 $ 38,726
_____________________
*Share information
Shares sold 670 1,066
Distributions reinvested 71 127
Shares redeemed (342) (597)
Increase (decrease) in shares outstanding 399 596
The accompanying notes are an integral part of these financial statements.
T. Rowe Price Georgia Tax-Free Bond Fund
UnauditedAugust 31, 1997
Notes to Financial Statements
Note 1 - Significant Accounting Policies
T. Rowe Price State Tax-Free Income Trust (the trust) is registered under the
Investment Company Act of 1940. The Georgia Tax-Free Bond Fund (the fund),
a nondiversified, open-end management investment company, is one of the
portfolios established by the trust and commenced operations on March 31,
1993.
Valuation Debt securities are generally traded in the over-the-counter
market. Investments in securities are stated at fair value as furnished by
dealers who make markets in such securities or by an independent pricing
service, which considers yield or price of bonds of comparable quality,
coupon, maturity, and type, as well as prices quoted by dealers who make
markets in such securities.
Assets and liabilities for which the above valuation procedures are
inappropriate or are deemed not to reflect fair value are stated at fair
value as determined in good faith by or under the supervision of the officers
of the fund, as authorized by the Board of Trustees.
Premiums and Discounts Premiums and original issue discounts on municipal
securities are amortized for both financial reporting and tax purposes.
Market discounts are recognized upon disposition of the security as gain or
loss for financial reporting purposes and as ordinary income for tax
purposes.
Other Income and expenses are recorded on the accrual basis. Investment
transactions are accounted for on the trade date. Realized gains and losses
are reported on the identified cost basis. Distributions to shareholders are
recorded by the fund on the ex-dividend date. Income and capital gain
distributions are determined in accordance with federal income tax
regulations and may differ from those determined in accordance with generally
accepted accounting principles.
Note 2 - Investment Transactions
Purchases and sales of portfolio securities, other than short-term
securities, aggregated $12,886,000 and $9,193,000, respectively, for the six
months ended August 31, 1997.
Note 3 - Federal Income Taxes
No provision for federal income taxes is required since the fund intends to
continue to qualify as a regulated investment company and distribute all of
its income. The fund has unused realized capital loss carryforwards for
federal income tax purposes of $955,000, which expires in 2003. The fund
intends to retain gains realized in future periods that may be offset by
available capital loss carryforwards.
At August 31, 1997, the aggregate cost of investments for federal income tax
and financial reporting purposes was $41,013,000, and net unrealized gain
aggregated $2,210,000, of which $2,215,000 related to appreciated investments
and $5,000 to depreciated investments.
Note 4 - Related Party Transactions
The investment management agreement between the fund and T. Rowe Price
Associates, Inc. (the manager) provides for an annual investment management
fee, of which $9,000 was payable at August 31, 1997. The fee is computed
daily and paid monthly, and consists of an individual fund fee equal to 0.10%
of average daily net assets and a group fee. The group fee is based on the
combined assets of certain mutual funds sponsored by the manager or Rowe
Price-Fleming International, Inc. (the group). The group fee rate ranges from
0.48% for the first $1 billion of assets to 0.30% for assets in excess of $80
billion. At August 31, 1997, and for the six months then ended, the effective
annual group fee rates were 0.32% and 0.33%, respectively. The fund pays a
pro-rata share of the group fee based on the ratio of its net assets to those
of the group.
Under the terms of the investment management agreement, the manager is
required to bear any expenses through February 28, 1999, which would cause
the fund's ratio of expenses to average net assets to exceed 0.65%.
Thereafter, through February 28, 2001, the fund is required to reimburse the
manager for these expenses, provided that average net assets have grown or
expenses have declined sufficiently to allow reimbursement without causing
the fund's ratio of expenses to average net assets to exceed 0.65%. Pursuant
to this agreement, $46,000 of management fees were not accrued by the fund
for the six months ended August 31, 1997. Additionally, $216,000 of unaccrued
management fees related to a previous expense limitation are subject to
reimbursement through February 28, 1999.
In addition, the fund has entered into agreements with the manager and a
wholly owned subsidiary of the manager, pursuant to which the fund receives
certain other services. The manager computes the daily share price and
maintains the financial records of the fund. T. Rowe Price Services, Inc.,
is the fund's transfer and dividend disbursing agent and provides shareholder
and administrative services to the fund. The fund incurred expenses pursuant
to these related party agreements totaling approximately $54,000 for the six
months ended August 31, 1997, of which $10,000 was payable at period-end.
T. Rowe Price Georgia Tax-Free Bond Fund
For yield, price, last transaction,
current balance, or to conduct
transactions, 24 hours, 7 days
a week, call Tele*Access(registered trademark):
1-800-638-2587 toll free
For assistance
with your existing
fund account, call:
Shareholder Service Center
1-800-225-5132 toll free
410-625-6500 Baltimore area
To open a Discount Brokerage
account or obtain information,
call: 1-800-638-5660 toll free
Internet address:
www.troweprice.com
T. Rowe Price Associates
100 East Pratt Street
Baltimore, Maryland 21202
This report is authorized for
distribution only to shareholders
and to others who have received
a copy of the prospectus of the
T. Rowe Price Georgia Tax-Free
Bond Fund.
Investor Centers:
101 East Lombard St.
Baltimore, MD 21202
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T. Rowe Price
T. Rowe Price Investment Services, Inc., Distributor.
F92-051 8/31/97
