MESSAGE FROM THE CHAIRMAN
Table of Contents
Message from the Chairman 1
Manager's Discussion 4
Fund Reports
Franklin New York Tax-Exempt
Money Fund 7
Franklin New York Insured
Tax-Free Income Fund 9
Franklin New York Intermediate-Term
Tax-Free Income Fund 14
Statement of Investments 18
Financial Statements 31
Notes to Financial Statements 34
August 15, 1995
Fellow Shareholders:
It's a pleasure to bring you the semi-annual report of the Franklin New York
Tax-Free Trust for the period ended June 30, 1995.
Calendar year 1994 was one of the worst years for fixed-income securities. In
fact, the 20-year U.S. Treasury bond recorded its poorest performance since
1967.1 Following this disappointing year, 1995 to date has been a welcome
change. Stock and bond markets enjoyed strong performance through the first six
months of the year. In February, the Dow Jones Industrial Average(R) broke the
4,000 mark for the first time, and finished the period above 4,500. The bond
market, as measured by the Lehman Brothers Aggregate Bond Index, rose 7.69% to
$104.02 from $96.59 on December 31, 1994.
Of more importance to shareholders of the Franklin New York Tax-Free Trust is
the recent strength of the municipal bond market. Although the rally was
sidetracked in early December by the municipal bankruptcy filing of Orange
County, California, the municipal market has continued to keep pace with the
strength in the U.S. government market. Through June 30, 1995, municipal bond
prices, as measured by the Bond Buyer 40 Index, had risen 2.11% to $98.19 from
$96.16 at the beginning of 1995. Of course, there's no guarantee that these
markets will continue to rise as they have recently. In fact, debate regarding a
national flat tax has been a concern for the municipal market.
There has been a tremendous amount of press discussing various tax reform
issues, including the flat tax proposal, a consumption tax, a national sales
tax, and a "Super IRA." Each of these proposals pose various underlying
questions -- Will there be any allowed deductions? Will I lose the benefit of
investing in tax-free municipal bonds? As you can imagine, a number of details
need to be fully considered. Such news coverage has understandably caused some
concern among investors; however, it is probably too early to draw clear-cut
conclusions on how any of the proposed tax reform plans could impact the
municipal bond market. Every administration has its own tax proposals. It is
management's opinion that tax-free investing through the investments in
municipal bonds will continue to be an attractive and economic means of raising
funds for the state and local governments. We will continue to monitor this
situation.
As you know, markets experience both ups and downs, which is a normal part of
investing. That's why we've always encouraged our shareholders to focus on their
long-term investment goals. History has shown that, over the long term, stocks
and bonds have delivered impressive results.2 By concentrating on long-term
investment goals, you need not be unduly concerned with short-term market
fluctuations.
You can also help minimize the effects of market fluctuations by diversifying
your investments. Mutual funds offer a level of diversification that would be
almost impossible for individual investors to achieve on their own. Mutual funds
also provide full-time, professional management, and Franklin's Municipal Bond
Research Department is one of the largest in the industry.3 Our analysts
frequently make site visits to obtain invaluable first-hand information about
issuers and specific municipal projects. If you have any questions, we would
welcome the chance to answer them.
As always, we appreciate your trust and support, and look forward to serving you
in the years to come.
Sincerely,
Charles B. Johnson
Chairman
1. Source: Ibbotson Associates. Based on one-year total returns of long-term
government bonds from January 1926 to December 1994.
2. Past performance cannot guarantee future results.
3. Source: Research and Ratings Review, Vol. II, Issue 8, November 14, 1994.
Franklin's municipal research team ranks second out of 1,000 investment advisory
firms, in terms of municipal bond analysts, in a survey by TMS Holdings, Inc.
MANAGER'S DISCUSSION
The Franklin New York Tax-Free Trust's six month reporting period ended June 30,
1995, was one of contrasts. During the fund's previous fiscal year, bond prices
fell dramatically in the face of rapidly rising interest rates. By December of
'94, however, economic growth had slowed considerably, inflation remained
subdued, and the municipal bond market headed into a much welcomed rally. The
recovery was disrupted by the bankruptcy of Orange County, California in early
December, but this crisis was short-lived. However, municipal bond prices
continued their recovery and by June 30, 1995, had risen 6.15% to $100.34 since
December 31, 1994.1
New York's economy entered the recession earlier than the rest of the nation and
is rebounding more slowly. National employment is not expected to reach
pre-recession peaks until the end of 1998, and it is estimated that it will take
New York significantly longer to regain the more than 560,000 job losses.
However, the outlook for the state is optimistic. New York began its financial
reform in fiscal year 1993, and -- for the last two years -- the state's budget
appears to be under control. While the 1995 budget was not approved on time, the
state continued to utilize conservative spending patterns to create a budget. As
a result, New York's mid-year financial reports reflect a positive financial
operation.2
In managing our tax-free funds, we seek to provide shareholders with as high a
level of current income as is consistent with the preservation of capital that
is exempt from federal income taxes and, in most cases, state personal income
taxes as well.3 To achieve this goal, we generally purchase current coupon bonds
at a slight discount. We also practice a "buy and hold" strategy, electing to
retain higher coupon bonds (even when they trade at a premium) for the higher
income they provide, thus helping us live up to our funds' objectives. This
strategy has a number of beneficial side effects, including fairly low portfolio
turnover rates and lower expenses. This approach also tends to help protect the
funds from extreme price volatility. Since bonds that trade at a premium are
generally slower to react to market fluctuations, the large percentage of such
bonds in our funds helped to dampen the effects of 1994's uncertain bond market.
In short, we believe our investment approach provides portfolios with more
potential to pay a high level of tax-free income while enjoying comparatively
stable share prices.
We believe the coming months should be strong ones for the municipal bond market
as bond issuance has fallen dramatically in the face of higher interest rates
and voter reluctance to approve new projects. As a result, we expect the new
supply of municipal bonds to be roughly $130 to $140 billion in 1995 -- slightly
less than last year, and significantly less than 1993, when municipal bond
issuance hit an all-time high. At the same time, there will be a record number
of bonds that will be redeemed or called in 1995 (approximately $185 billion)
which will return cash to investors that will need to be reinvested. This should
help increase demand for municipal bonds. While we expected 1994's reduced
supply to bode well for the municipal bond market, dramatic increases in
interest rates by the Federal Reserve Board overshadowed any positive effects of
a lower supply. Fortunately, long-term interest rates have declined in 1995, and
the slowing economy suggests that the Fed's aggressive campaign to restrict the
money supply is near its end. In fact, given the significant drop in growth of
the Gross Domestic Product (GDP) in the first quarter of 1995 (GDP was 2.1%
compared to 5.1% for the last quarter of 1995), the Fed reduced its short-term
federal funds rate by a quarter of a percentage point on July 6, 1995.
Furthermore, yields from municipal securities are currently very attractive
relative to yields available from U.S. Treasuries and other high-quality,
taxable fixed-income securities. For instance, municipal bonds, represented by
the Bond Buyer 40 (an index of 40 municipal bonds) demonstrated a yield of 6.28%
on June 30, 1995. For investors in the maximum federal income tax bracket of
39.6%, this tax-free yield equals a taxable yield of 10.39%, whereas the average
30-year U.S. Treasury bond offered a taxable yield of 6.63% on June 30, 1995.
Given their relative value and the reduced supply available, we expect municipal
bonds to perform well in the coming year.
Sincerely,
Thomas J. Kenny
Senior Vice President --
Director, Franklin Municipal Bond Department
1. Source: Lehman Brothers Municipal Bond Index.
2. Source: Standard & Poor's Creditweek Municipal, 12/04/94.
3. For investors subject to federal or state alternative minimum tax, all or a
portion of these dividends may be subject to such tax, depending on the fund.
Distributions of capital gains and of ordinary income from accrued market
discount, if any, are generally taxable.
FRANKLIN NEW YORK TAX-EXEMPT MONEY FUND
Fund Objective:
Seeks to provide shareholders with a high level of current income exempt from
regular federal, New York state and New York City personal income taxes by
investing in a diversified portfolio of short-term municipal debt securities
issued in New York. The fund is managed to maintain a $1 share price.*
On June 30, 1995, the fund's seven-day effective yield, which assumes the
compounding of daily dividends, was 3.45%, and the fund's seven-day annualized
yield was 3.39%. This tax-free rate is generally higher than the after-tax
return on a comparable taxable investment. As the chart on page 8 illustrates,
if you are in the maximum combined federal, New York state and New York City
personal income tax bracket of 46.9%, your fund's annualized yield was
equivalent to a taxable yield of 6.38%.
Throughout the six month period, we have maintained a high degree of liquidity,
as measured by the fund's relatively short average maturity.
On June 30, 1995, the fund's average maturity was 15 days, down slightly from
the average maturity of 19 days at the start of the reporting period. By keeping
the maturity short, we were able to reinvest in securities offering higher
rates, thereby increasing the fund's yield.
We believe the economy may be in for several quarters of slow growth as
production levels for high ticket items have been scaled back and factories work
to reduce the inventory that was built up during the first two quarters of 1995.
In recognition of this, we have moved to a more neutral stance on the market and
have extended maturities slightly to protect the fund against a continued
deceleration in growth and a further decline in rates.
GRAPHIC MATERIAL 2 OMMITTED - SEE APPENDIX AT END OF DOCUMENT
The securities in which the fund invests are among the highest quality available
to money market portfolios. As the fund's objective is to provide shareholders
with a high-quality, conservative investment, we do not invest in derivatives or
other potentially volatile securities that we think involve significant risk.
As a shareholder in the Franklin New York Tax-Exempt Money Fund, you continue to
benefit from easy access to your money and high credit safety. You also enjoy a
variety of services, including free, unlimited check writing for amounts of $100
or more, free wiring privileges, and a 24-hour automated customer service line.
*The fund will seek to comply with all federal and state regulations regarding
the payment of tax-exempt income dividends. Investors subject to the federal
alternative minimum tax may find a small portion of the income dividends subject
to such tax. Distributions of capital gains and ordinary income from accrued
market discount, if any, are generally taxable. An investment in the fund is
neither insured nor guaranteed by the U.S. government. There is no assurance
that the $1.00 per share price will be maintained.
Franklin New York Tax-Exempt Money Fund
Periods ended June 30, 1995
Seven-day annualized yield 3.39%
Taxable equivalent yield2 6.38%
Seven-day effective yield1 3.45%
1. The seven-day effective yield assumes the compounding of daily dividends.
2. Taxable equivalent yield assumes the 1995 maximum combined 46.9% federal, New
York state and New York City income tax bracket, based on the maximum federal
income tax rate of 39.6%.
Annualized and effective yields are for the seven days ended June 30, 1995.
Yields reflect fluctuations in interest rates on portfolio investments, as well
as fund expenses. Yields should be viewed in terms of the current, low rate of
inflation -- just as high inflation usually results in higher yields, low
inflation often results in lower yields. Past performance does not guarantee
future results.
The fund's manager has agreed in advance to waive a portion of the management
fees, which reduces expenses and increases yield. Without these reductions, the
fund's annualized and effective yields for the period would have been 3.13% and
3.18%, respectively. The fee waiver may be discontinued at any time upon
notification to the fund's Board of Trustees.
Please remember that an investment in the fund is neither insured nor guaranteed
by the U.S. government, and there can be no assurance that the fund will be able
to maintain a stable net asset value of $1.00 per share.
FRANKLIN NEW YORK INSURED TAX-FREE INCOME FUND
Fund Objective
To provide high current income exempt from regular federal, New York state and
New York City personal income taxes consistent with prudent investment
management by investing primarily in a portfolio of insured New York municipal
securities.*
Late 1994 and early 1995 presented the municipal bond market and tax-free bond
mutual funds with many challenges. Following the corrections in 1994, 30-year
U.S. Treasury bonds have come nearly full cycle, almost returning to the low
yields of the 1992/1993 rally. Additionally, the supply of municipal bonds fell
50% to 60% of the amount issued during the 1992-'93 period.
As yields rose in 1994, we took advantage of the opportunity to sell off
lower-yielding purchases made in the previous two years, and reinvest the
proceeds in bonds with better coupons and maturities. This benefited your fund
in a couple of ways. First, it improved the income generated by the fund.
Second, higher coupon bonds exhibited greater price stability than those with
lower coupons, helping to decrease the fund's volatility. As a result, the
fund's average coupon rose to 6.26% on June 30, 1995, from 6.18% on December 31,
1994.
The insured bonds in your fund's portfolio are insured by private municipal bond
insurance companies as to the scheduled payment of principal and interest on the
portfolio's securities. Because of this insurance, the fund continues to enjoy a
"AAAf" rating -- the highest mutual fund rating possible -- from Standard &
Poor's Corporation. The rating reflects Standard & Poor's assessment of the
overall credit quality of the fund's portfolio, based primarily on the fund's
stated investment objectives and policies. It considers, for example, not only
the credit quality of portfolio investments, but the experience and stability of
management. The rating does not reflect the yield or the market price of the
fund's shares, nor does it imply approval by Standard & Poor's, and is subject
to change.
Franklin maintains a very conservative approach in seeking to achieve the fund's
objectives. We strive to maximize shareholders' current tax-free income while
attempting to minimize risk. Our strategy is simple: we purchase securities
based on their income-producing potential and avoid short-term trading to
capture capital gains. In addition, we also purchase bonds as close to par, or
face value, as possible in the current marketplace.
We continue to be selective about our investments. We evaluate each issue on an
individual basis, favoring highly rated "essential service" bonds. These
securities tend to have a more reliable income stream, as they are usually
backed by dependable revenue generated from courthouses, jails, and water, power
and sewer projects, to name a few. As a result, these bonds tend to be less
affected by budgetary and political changes, and are believed to be less
affected by a municipal cost-cutting environment. Please keep in mind, however,
that the principal value of the fund's holdings -- as well as the price of the
fund's shares -- will fluctuate with market conditions.
As interest rates begin to work their way down -- as they have recently -- the
volume of new municipal bond issuance may pick up from pre- refunded issues as
borrowers take advantage of interest cost savings on their outstanding debt.
However, it is unlikely that this will approach the volume of nearly $300
billion that the market experienced in 1993. We expect that infrastructure
borrowings will begin to add to the primary market activity in 1996;
unfortunately, this will not be of much help in 1995.
Performance Summary
The Franklin New York Insured Tax-Free Income Fund's Class I share price, as
measured by net asset value, increased to $10.98 on June 30, 1995, from $10.16
on December 31, 1994. The fund's Class II share price, as measured by net asset
value, was $10.85 on May 1, 1995, the Class II share inception date, and ended
the reporting period at $11.01 on June 30, 1995.
The fund continued to meet its primary investment objective of providing high
current income to its shareholders. For the six-month period ended June 30,
1995, your fund's Class I shares paid monthly income distributions totaling 29.4
cents ($0.294) per share. The fund's Class II shares began distributing income
on May 22, 1995, and provided shareholders with monthly income distributions
totaling 7.5 cents ($0.075) per share.a Dividends will vary based on the
earnings of the fund's portfolio, and past distributions are not necessarily
predictive of future results.
GRAPHIC MATERIAL 1 OMMITTED - SEE APPENDIX AT END OF DOCUMENT
GRAPHIC MATERIAL 3 OMMITTED - SEE APPENDIX AT END OF DOCUMENT
At the end of the reporting period, your fund's Class I shares distribution rate
was 5.13%, based on an annualization of the current monthly dividend of 4.9
cents ($0.049) per share and the maximum offering price of $11.47 on June 30,
1995. The Class II shares reported a distribution rate of 4.64%, based on the
annualization of the current monthly dividend of 4.3 cents ($0.043) per share
and the maximum offering price of $11.12 on June 30, 1995. These tax-free rates
are generally higher than the after-tax return on comparable taxable
investments. For example, if you are in the maximum combined federal, New York
state and New York City personal income tax bracket of 46.9%, you would have to
earn 9.66% from a taxable investment to match your fund's Class I shares
tax-free distribution rate, and 8.74% to match your fund's Class II shares
tax-free distribution rate.
Your fund's managers maintain a long-term investment perspective and we
encourage our shareholders to view their investments in a similar manner. While
the fund may experience volatility from time to time, we believe that its
performance will be rewarding over the long term. For example, the fund provided
a total return of over 36% since its inception in 1991.
Franklin New York Insured Tax-Free Income Fund
Periods ended June 30, 1995
<TABLE>
<CAPTION>
Since
Inception
1-Year 3-Year (05/01/91)
--------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Cumulative Total Return1
Class I Shares 8.67% 21.44% 36.20%
Average Annual Total Return2
Class I Shares 4.09% 5.16% 6.58%
Distribution Rate3 Taxable Equivalent Distribution Rate4
Class I Shares 5.13% Class I Shares 9.66%
Class II Shares 4.64% Class II Shares 8.74%
30-Day Standardized Yield5 Taxable Equivalent Yield4
Class I Shares 4.90% Class I Shares 9.23%
Class II Shares 4.79% Class II Shares 9.02%
--------------------------------------------------------------------------------------------------------
</TABLE>
1. Cumulative total return measures the change in value of an investment over
the periods indicated and does not include the maximum 4.25% initial sales
charge for Class I shares. See note below.
2. Average annual total return represents the average annual change in value of
an investment over the specified periods. The figures have been restated to
reflect the maximum 4.25% initial sales charge for Class I shares. See note
below.
3. Class I shares distribution rate is based on an annualization of the fund's
current 4.9 cent per share monthly dividend and the maximum offering price of
$11.47 on June 30, 1995. Class II shares distribution rate is based on an
annualization of the fund's current 4.3 cent per share monthly dividend and the
maximum offering price of $11.12 on June 30, 1995.
4. Taxable equivalent distribution rate and yield assume the 1995 maximum
combined federal, New York state and New York City income tax bracket of 46.9%,
based on the 39.6% federal income tax rate.
5. Yield, calculated as required by the SEC, is based on the earnings of the
fund's portfolio for the 30 days ended June 30, 1995.
Note: Prior to July 1, 1994, fund shares were offered at a lower initial sales
charge, with dividends reinvested at the public offering price. Thus, actual
total returns for purchasers of shares during that time would have been somewhat
different than noted above. Effective May 1, 1994, for Class I shares, the fund
eliminated the sales charge on reinvested dividends and implemented a plan of
distribution under Rule 12b-1, which will affect future performance. Class II
shares, which the fund began offering on May 1, 1995, are subject to different
fees and expenses, which will affect their performance. Class II shares are not
shown as they have not been available for a sufficient period of time. Please
see the prospectus for more details regarding Class I and Class II shares.
All total return calculations assume reinvestment of dividends and capital gains
at net asset value. Investment return and principal value will fluctuate with
market conditions, and you may have a gain or loss when you sell your shares.
Past performance cannot guarantee future results.
The fund's manager has agreed in advance to waive a portion of management fees,
which reduces operating expenses and increases yield, distribution rate and
total return. Without these reductions, the fund's distribution rate and total
return would have been lower, and yield for the period would have been 4.84% for
Class I shares and 4.72% for Class II shares. The fee waiver may be discontinued
at any time upon notification to the fund's Board of Trustees.
*For investors subject to the federal alternative minimum tax,
a small portion of these dividends may be subject to such tax. Distributions of
capital gains and of ordinary income from accrued market discount, if any, are
generally taxable.
+Fund shares are not insured by any U.S. government agency.
Insurance relates only to the payment of principal and interest on the
portfolio's securities. It does not eliminate market risks to the fund's share
price or insure the value of the shares. Terms of the insurance are more fully
described in the prospectus, and no representation is made as to any insurer's
ability to meet its commitments.
Franklin New York Insured
Tax-Free Income Fund
Portfolio Breakdown on June 30, 1995
As a percentage of total net assets
% of total
Sector net assets
Utilities 31.1%
Education 19.1%
Transportation 16.5%
General Obligations 13.5%
Hospitals 6.4%
Pre-Refunded 5.0%
Health Care 4.7%
Other Revenue 1.4%
Industrial 1.3%
Housing 1.0%
For a complete list of portfolio holdings, please see page 21 of this report.
aAssumes shares were purchased and held for the entire accrual period. Since
dividends accrue daily, your actual distributions will vary depending on the day
you purchased your shares and any account activity during the month. Income
distributions and total return calculations include all accrued income earned by
the fund during the reporting period.
FRANKLIN NEW YORK INTERMEDIATE-TERM TAX-FREE INCOME FUND
Fund Objective
Seeks to provide shareholders with high current income exempt from regular
federal, New York state and New York City income taxes consistent with the
preservation of capital. The fund invests primarily in a portfolio of municipal
bonds with an average weighted maturity (the time in which debt must be repaid)
between three and ten years.*
The bond market experienced a rally in November 1994, shortly after the Federal
Reserve Board raised the federal funds rate for the sixth time. This recovery
has resulted in a 4.57% gain in the fund's net asset value price, finishing the
reporting period at $10.06 on June 30, 1995, up from $9.60 on December 31, 1994.
Trading activity was light during the fund's fiscal year. We took the
opportunity to sell our lower coupon bonds and used the proceeds to fund
purchases of higher coupon bonds. Because of the lack of municipal issuance,
quality spreads among municipal bonds were much narrower. As a result, bonds
bought during the reporting period were higher coupons in the 8- to 12-year
maturity range, and were rated A to AAA in terms of credit quality. At the end
of the reporting period, the fund's average maturity was 8.9 years, down
slightly from 9.3 years on December 31, 1994.
GRAPHIC MATERIAL 5 OMMITTED - SEE APPENDIX AT END OF DOCUMENT
We remain conservative in our management of the fund. When purchasing
securities, we evaluate each issue on an individual basis, favoring highly-rated
"essential service" bonds. These securities tend to have a more reliable income
stream as they are backed by dependable revenue generated from projects such as
utilities, transportation, water, and power and sewer works, to name a few. As a
result, these bonds tend to be less affected by budgetary and political changes,
and are believed to be very attractive in a municipal cost-cutting environment.
Like all mutual funds, however, the principal value of the fund's holdings, as
well as the price of its shares, will vary with market conditions.
Our outlook for the fund is positive. Signs of a slowing economy could result in
continued declines in interest rates, which should positively affect bond prices
and, thus, the fund's price per share.
Performance Summary
The Franklin New York Intermediate-Term Tax-Free Income Fund's share price, as
measured by net asset value, increased to $10.06 on June 30, 1995, from $9.60 on
December 31, 1994.
The fund continued to meet its investment objective of providing high current
income to its shareholders. For the six-month period ended June 30, 1995, your
fund paid monthly income distributions totaling 27 cents ($0.27) per share. We
are pleased to report that due to increased income earned by the fund, we were
able to increase your monthly dividend distribution to 4.6 cents ($0.046) per
share from 4.4 cents ($0.044) per share, effective with the April 1995
distribution. Dividends will vary based on the earnings of the fund's portfolio,
and past distributions are not necessarily predictive of future results.
GRAPHIC MATERIAL 4 OMMITTED - SEE APPENDIX AT END OF DOCUMENT
At the end of the reporting period, the fund's distribution rate was 5.36%,
based on an annualization of the current monthly dividend of 4.6
cents ($0.046) per share and the maximum offering price of $10.29 on June 30,
1995.
This tax-free rate is generally higher than the after-tax return on a comparable
taxable investment. For example, if you are in the maximum combined federal, New
York state and New York City personal income tax bracket of 46.9%, you would
have to earn 10.09% from a taxable investment to match your fund's tax-free
distribution rate.
Your fund's managers maintain a long-term investment perspective and we
encourage our shareholders to do the same. While the fund may experience
volatility from time to time, we believe that its performance will be rewarding
over the long term.
Franklin New York Intermediate-Term
Tax-Free Income Fund
Period ended June 30, 1995
Since
Inception
1-Year (09/23/92)
Cumulative Total Return1 5.34% 14.72%
Average Annual Total Return2 2.99% 4.22%
Distribution Rate3 5.36%
Taxable Equivalent Distribution Rate4 10.09%
30-Day Standardized Yield5 5.08%
Taxable Equivalent Yield4 9.57%
1. Cumulative total return measures the change in value of an investment over
the periods indicated and does not include the maximum 2.25% initial sales
charge stated in the prospectus. See note below.
2. Average annual total return represents the average annual change in value of
an investment over the specified periods. The figures have been restated to
reflect the maximum 2.25% initial sales charge. See note below.
3. Based on an annualization of the fund's current 4.6 cent per share monthly
dividend and the maximum offering price of $10.29 on June 30, 1995.
4. Taxable equivalent distribution rate and yield assume the 1995 maximum
combined federal, New York state and New York City income tax bracket of 46.9%,
based on the 39.6% federal income tax rate.
5. Yield, calculated as required by the SEC, is based on the earnings of the
fund's portfolio for the 30 days ended June 30, 1995.
Note: All total return calculations assume reinvestment of dividends and capital
gains at net asset value. Investment return and principal value will fluctuate
with market conditions, and you may have a gain or loss when you sell your
shares. Past performance is not predictive of future results.
The fund's manager has agreed in advance to waive a portion of the management
fees, which reduces operating expenses and increases distribution rate, yield
and total return to shareholders. Without this waiver, the fund's distribution
rate would have been lower, and yield for the period would have been 4.65%. The
fee waiver may be discontinued at any time upon advance notice to the fund's
Board of Trustees.
*For investors subject to the federal alternative minimum tax,
a small portion of these dividends may be subject to such tax. Distributions of
capital gains and of ordinary income from accrued market discount, if any, are
generally taxable.
Franklin New York Intermediate-Term
Tax-Free Income Fund
Portfolio Breakdown on June 30, 1995
As a percentage of total net assets
% of total
Sector net assets
General Obligations 30.8%
Transportation 14.8%
Utilities 11.5%
Other Revenue 11.4%
Certificates of Participation 10.6%
Hospitals 10.5%
Education 9.2%
Industrial 1.2%
For a complete list of portfolio holdings, please see page 29 of this report.
Assumes shares were purchased and held for the entire accrual period. Since
dividends accrue daily, your actual distributions will vary depending on the day
you purchased your shares and any account activity during the month. Income
distributions and total return calculations include all accrued income earned by
the fund during the reporting period.
FRANKLIN NEW YORK TAX-FREE TRUST
Statement of Investments in Securities and Net Assets, June 30, 1995 (unaudited)
<TABLE>
<CAPTION>
Face Value
Amount Franklin New York Tax-Exempt Money Fund (Note 1)
Investments 99.3%
<S> <C> <C>
$ 712,000 Albany County Refunding, South Mall Construction, Series B, FGIC Insured,
3.75%, 10/01/95 ................................................................................ $ 712,000
1,500,000 a Babylon IDA, Resources Recovery Revenue, Equity Babylon Project, Daily VRDN
and Put, 4.40%, 12/01/24 ....................................................................... 1,500,000
300,000 a Babylon, Town of, IDA, IDR, General Microwave Corp. Facility, Series 1984,
Weekly VRDN and Put, 3.75%, 10/01/99 ........................................................... 300,000
1,300,000 a Erie County Water Authority Revenue, Series A, AMBAC Insured, Weekly VRDN
and Put, 4.00%, 2/01/16 ........................................................................ 1,300,000
1,500,000 a Great Neck North, Water Authority System Revenue, Series A, FGIC Insured,
Weekly VRDN and Put, 4.00%, 01/01/20 ........................................................... 1,500,000
500,000 Hempstead Town BAN, Series D, 4.50%, 08/17/95 ................................................... 500,138
1,000,000 a Nassau County IDA, IDR, Refunding, Credit Place, Inc. Project, Series A, Weekly
VRDN and Put, 4.35%, 06/01/07 .................................................................. 1,000,000
1,000,000 Nassau IDA, Research Facility Revenue, Cold Spring Harbor Laboratory Project,
Optional Put 08/31/95, 4.40%, 07/01/23 ......................................................... 1,000,000
3,000,000 a New York and New Jersey Port Authority, Special Obligation Revenue, Versatile
Structure Obligation, Series 3, Daily VRDN and Put, 4.15%, 06/01/20 ............................ 3,000,000
a New York City GO,
200,000 Refunding, Series D, Daily VRDN and Put, 4.00%, 08/01/95........................................ 200,000
600,000 Series B-4, Daily VRDN and Put, 4.50%, 08/15/21................................................. 600,000
800,000 Series B-4, Daily VRDN and Put, 4.25%, 08/15/23................................................. 800,000
1,000,000 Series B-4, Daily VRDN and Put, 4.50%, 08/15/23 ................................................ 1,000,000
300,000 Series B-7, AMBAC Insured, Daily VRDN and Put, 4.25%, 08/15/18 ................................. 300,000
200,000 Series B-8, Weekly VRDN and Put, 3.95%, 08/15/24 ............................................... 200,000
a New York City HDC, Mortgage Revenue,
1,000,000 Columbus Apartments, Series A, Weekly VRDN and Put, 3.80%, 03/15/25 ............................ 1,000,000
1,450,000 Parkgate Tower No. 1, Weekly VRDN and Put, 3.85%, 12/01/07 ..................................... 1,450,000
500,000 a New York City IDA, Various Civic Facilities, National Audubon Society, Daily VRDN
and Put, 4.35%, 12/01/14 ....................................................................... 500,000
1,000,000 a New York City IDA, IDR, Field Hotel Association Project, JFK Project, Weekly VRDN
and Put, 4.10%, 12/01/15 ....................................................................... 1,000,000
2,600,000 a New York City IDA, IDR, La Guardia Association Project, Weekly VRDN and Put,
4.10%, 12/01/15 ................................................................................ 2,600,000
a New York City Municipal Water Financial Authority, Water and Sewer Systems Revenue,
800,000 Series C, FGIC Insured, Daily VRDN and Put, 4.25%, 06/15/22 .................................... 800,000
1,000,000 Series G, FGIC Insured, Daily VRDN and Put, 4.10%, 06/15/24 .................................... 1,000,000
a New York City Tri-Cultural Resources Revenue,
1,200,000 American National Museum, Series B, MBIA Insured, Weekly VRDN and Put,
3.95%, 04/01/21 ................................................................................ 1,200,000
1,000,000 Solomon R. Guggenheim, Series B, Daily VRDN and Put, 4.35%, 12/01/15 ............................ 1,000,000
300,000 The Jewish Museum, Weekly VRDN and Put, 4.00%, 12/01/21 ......................................... 300,000
a New York State Dormitory Authority Revenues,
$ 2,700,000 Metropolitan Museum of Art, Series B, Weekly VRDN and Put, 3.90%, 07/01/23....................... $ 2,700,000
1,000,000 Oxford University Press, Inc., Daily VRDN and Put, 5.25%, 07/01/23 .............................. 1,000,000
a New York State Energy Research and Development Authority, PCR,
1,800,000 New York Electric & Gas, Series B, Daily VRDN and Put, 4.20%, 02/01/29 .......................... 1,800,000
500,000 Niagara Mohawk Power Corp., Series 1985-B, Daily VRDN and Put, 4.20%, 12/01/25 .................. 500,000
200,000 Niagara Mohawk Power Corp., Series 1986-A, Daily VRDN and Put, 4.30%, 12/01/26................... 200,000
1,000,000 Orange and Rockland Project, Series A, FGIC Insured, Weekly VRDN and Put,
3.95%, 10/01/14 ................................................................................ 1,000,000
200,000 a New York State Environmental Facilities Corp., Resource Recovery Revenue,
OFS Equity, Huntington Project, Daily VRDN and Put, 4.35%, 11/01/14 ............................ 200,000
1,000,000 New York State Environmental Facilities Corp., TECP, Solid Waste Disposal Revenue,
General Electric Co. Project, Series A, 3.45%, 08/02/95 ........................................ 1,000,000
2,500,000 New York State GO, TECP, 3.55%, 10/02/95 ........................................................ 2,500,000
300,000 a New York State HFA, MFR, Series A, AMBAC Insured, Weekly VRDN and Put,
3.75%, 11/01/28 ................................................................................ 300,000
1,100,000 a New York State HFA, Normandie Court I Project, Weekly VRDN and Put,
3.90%, 05/15/15 ................................................................................ 1,100,000
a New York State Job Development Authority, State Guaranteed,
320,000 Series C-1 to C-30, Monthly VRDN and Put, 3.60%, 03/01/99 ...................................... 320,000
190,000 Series G-1 to G-33, Monthly VRDN, Weekly Put, 3.60%, 03/01/99 .................................. 190,000
a New York State Local Government Assistance Corp.,
2,300,000 Series A, Weekly VRDN and Put, 3.70%, 04/01/22 ................................................. 2,300,000
400,000 Series B, Weekly VRDN and Put, 3.70%, 04/01/23 ................................................. 400,000
3,600,000 a New York State Metropolitan Transport Authority, Commuter Facilities Revenue,
Weekly VRDN and Put, 3.75%, 07/01/21 ........................................................... 3,600,000
New York State Power Authority Revenue and General Purpose, Optional Put 09/01/95,
1,000,000 4.40%, 03/01/16 ................................................................................ 1,000,000
1,000,000 Series T, 7.375%, 01/01/96 ..................................................................... 1,035,038
1,030,000 a Niagara County IDA, IDR, Pyron Corp. Project, Weekly VRDN and Put, 4.15%, 11/01/04 .............. 1,030,000
1,700,000 a Niagara Falls Bridge Commission, Toll Revenue, Series A, FGIC Insured, Weekly VRDN
and Put, 4.00%, 10/01/19 ....................................................................... 1,700,000
1,100,000 a North Hempstead Solid Waste Management Authority Revenue, Refunding, Series A,
Weekly VRDN and Put, 3.75%, 02/01/12 ........................................................... 1,100,000
800,000 a Onondaga Country IDA, IDR, FRN, Pass & Seymour, Inc., Series B, Monthly VRDN
and Weekly Put, 3.30%, 11/13/98 ................................................................ 800,000
1,000,000 a Puerto Rico Commonwealth, Government Development Bank, Refunding, Weekly
VRDN and Put, 3.80%, 12/01/15 .................................................................. 1,000,000
1,000,000 a Rotterdam IDA, IDR, Refunding, Rotterdan Industrial Park Project, Series A, Weekly
VRDN and Put, 3.80%, 11/01/09 .................................................................. 1,000,000
$ 700,000 a Schenectady County IDA, IDR, Refunding, Scotia Industrial Park Project, Series A,
Weekly VRDN and Put, 3.80%, 06/01/09 ........................................................... $ 700,000
900,000 a Seneca County IDA, Civic Facility Revenue, New York Chiropractic College, Weekly
VRDN and Put, 4.05%, 10/01/21 .................................................................. 900,000
1,600,000 a St. Lawrence IDA, Environmental Impact Revenue, Reynolds Metals Co. Project,
Weekly VRDN and Put, 4.00%, 05/01/25 ........................................................... 1,600,000
295,000 a Suffolk IDA, IDR, Refunding, Phototronics Corp. Facility, Daily VRDN, Weekly Put,
4.10%, 01/01/98 ................................................................................ 295,000
400,000 a Syracuse IDA, Civic Facilities Revenue, Multi-Modal, Syracuse University Project,
Daily VRDN and Put, 4.35%, 03/01/23 ............................................................ 400,000
2,500,000 a Triborough Bridge and Tunnel Authority, Special Obligation, FGIC Insured, Weekly
VRDN and Put, 3.75%, 01/01/24 .................................................................. 2,500,000
800,000 a Yonkers IDA, Civic Facility Revenue, Consumers Union Facility, Weekly VRDN and Put,
3.95%, 07/01/19 ................................................................................ 800,000
------------
Total Investments (Cost $59,732,176)99.3%........................................................ 59,732,176
Other Assets and Liabilities Net.7%.............................................................. 400,876
------------
Net Assets100.0%................................................................................. $ 60,133,052
============
At June 30, 1995, there was no unrealized appreciation or depreciation for
financial statement or income tax purposes.
</TABLE>
PORTFOLIO ABBREVIATIONS:
AMBAC - American Municipal Bond Assurance Corp.
BAN - Bond Anticipation Notes
FGIC - Financial Guaranty Insurance Co.
FRN - Floating Rate Notes
GO - General Obligation
HDC - Housing Development Corp.
HFA - Housing Finance Authority/Agency
IDA - Industrial Development Authority/Agency
IDR - Industrial Development Revenues
MBIA - Municipal Bond Investors Assurance Corp.
MFR - Multi-Family Revenue
PCR - Pollution Control Revenues
TECP - Tax-Exempt Commercial Paper
aVariable rate demand notes (VRDN's) are tax-exempt obligations which contain a
floating or variable interest rate adjustment formula and an unconditional right
of demand to receive payment of the principal balance plus accrued interest upon
short notice prior to specified dates. The interest rate may change on specified
dates in relationship with changes in a designated rate (such as the prime
interest rate or U.S. Treasury bills rate).
The accompanying notes are an integral part of these financial statements.
FRANKLIN NEW YORK TAX-FREE TRUST
Statement of Investments in Securities and Net Assets, June 30, 1995 (unaudited)
<TABLE>
<CAPTION>
Face Value
Amount Franklin New York Insured Tax-Free Income Fund (Note 1)
Bonds 98.5%....................................................................
<S> <C> <C>
Albany Capital Improvement GO,
$500,000 MBIA Insured, 5.25%, 11/01/11 ................................................. $ 474,220
780,000 MBIA Insured, 5.25%, 11/01/13 ................................................. 732,747
Albany County GO,
1,000,000 FGIC Insured, 5.85%, 06/01/12 ................................................. 1,004,730
1,275,000 FGIC Insured, 5.85%, 06/01/13 ................................................. 1,275,930
2,505,000 Albany Municipal Water Finance Authority, Water and Sewer System Revenue,
Refunding, Series A, FGIC Insured, 5.95%, 12/01/12 ............................ 2,535,812
Alden Central School District,
275,000 AMBAC Insured, 6.25%, 06/15/08 ................................................ 293,906
275,000 AMBAC Insured, 6.25%, 06/15/09 ................................................ 290,760
125,000 AMBAC Insured, 6.25%, 06/15/10 ................................................ 131,848
2,615,000 Amsterdam HDC, Mortgage Revenue, Refunding, MBIA Insured, 6.25%, 01/01/25 ...... 2,597,532
200,000 Brookhaven GO, Series B, MBIA Insured, 7.00%, 05/01/09 ......................... 225,638
1,000,000 Broome County COP, Public Safety Facilities, MBIA Insured, 5.25%, 04/01/22 ..... 898,190
495,000 Broome and Delaware Counties School District, AMBAC Insured, 6.35%, 06/15/10 ... 524,482
Buffalo GO,
225,000 Series A & C, AMBAC Insured, Pre-Refunded, 7.25%, 04/01/08 .................... 254,752
360,000 Series E, AMBAC Insured, 6.70%, 12/01/17....................................... 385,175
385,000 Series E, AMBAC Insured, 6.70%, 12/01/18 ...................................... 411,923
410,000 Series E, AMBAC Insured, 6.70%, 12/01/19 ...................................... 438,671
700,000 Buffalo Sewer Authority System Revenue, Refunding, Series G, FGIC Insured,
5.25%, 07/01/08 ............................................................... 683,900
100,000 Camden Central School District, AMBAC Insured, 7.10%, 06/15/07 ................. 115,291
Canandaigua City School District,
625,000 AMBAC Insured, 6.40%, 06/01/08 ................................................ 676,444
110,000 AMBAC Insured, 6.50%, 06/01/10 ................................................ 119,327
550,000 AMBAC Insured, 6.50%, 06/01/11 ................................................ 595,573
Central Square School District,
900,000 FGIC Insured, 6.50%, 06/15/08 ................................................. 986,885
900,000 FGIC Insured, 6.50%, 06/15/09 ................................................. 977,625
70,000 Chateaugay Central School District, AMBAC Insured, 6.70%, 06/15/09 ............. 77,380
Clifton Park Water Authority, Water System Revenue,
2,625,000 Series A, FGIC Insured, Pre-Refunded, 6.375%, 10/01/11 ........................ 2,937,926
2,000,000 Series A, FGIC Insured, Pre-Refunded, 6.375%, 10/01/26 ........................ 2,238,420
Eastport USD,
225,000 MBIA Insured, 6.45%, 12/01/06 ................................................. 246,917
225,000 MBIA Insured, 6.45%, 12/01/07 ................................................. 246,141
225,000 MBIA Insured, 6.45%, 12/01/08 ................................................. 245,066
$ 200,000 Erie County Water Authority Revenue, Refunding, Series B, AMBAC Insured,
ETM 12/01/09, 6.75%, 12/01/14 ................................................. $ 219,472
Evans-Brant Central School District,
100,000 Series 1991, MBIA Insured, 6.85%, 06/15/08 .................................... 112,874
55,000 Series 1991, MBIA Insured, 6.85%, 06/15/09 .................................... 61,590
Fallsburg Public Improvement, GO,
330,000 Refunding, Series B, AMBAC Insured, 5.25%, 04/01/13 ........................... 308,293
145,000 Refunding, Series B, AMBAC Insured, 5.25%, 04/01/14 ........................... 134,385
330,000 Series B, AMBAC Insured, 5.50%, 04/01/08 ...................................... 328,474
345,000 Series B, AMBAC Insured, 5.50%, 04/01/10 ...................................... 336,472
Greece Central School District No. 1,
950,000 Series 1992, FGIC Insured, 6.00%, 06/15/16 .................................... 961,286
950,000 Series 1992, FGIC Insured, 6.00%, 06/15/17 .................................... 955,729
950,000 Series 1992, FGIC Insured, 6.00%, 06/15/18 .................................... 955,852
285,000 Hamburg Town Public Improvement, MBIA Insured, 6.30%, 11/15/10 ................. 300,820
Hempstead Town,
125,000 Series B, AMBAC Insured, 6.50%, 01/01/10 ...................................... 134,770
100,000 Series B, AMBAC Insured, 6.50%, 01/01/11 ...................................... 108,155
100,000 Series B, AMBAC Insured, 6.50%, 01/01/12 ...................................... 107,919
150,000 Series C, AMBAC Insured, 6.50%, 02/15/10 ...................................... 161,778
150,000 Series C, AMBAC Insured, 6.50%, 02/15/11 ...................................... 162,284
100,000 Series C, AMBAC Insured, 6.50%, 02/15/12 ...................................... 107,948
Hermon de Kalb, Etc., Central School District,
150,000 Series 1992, MBIA Insured, 6.45%, 06/15/09 .................................... 160,715
150,000 Series 1992, MBIA Insured, 6.45%, 06/15/10 .................................... 160,425
150,000 Series 1992, MBIA Insured, 6.45%, 06/15/11 .................................... 160,857
2,000,000 Islip Resources Recovery Agency Revenue, Series B, AMBAC Insured,
6.125%, 07/01/12 .............................................................. 2,023,080
375,000 Lake George Central School District, MBIA Insured, 6.50%, 06/15/09 ............. 405,454
Lockport GO,
265,000 Series B, MBIA Insured, 6.15%, 03/15/18 ....................................... 270,170
280,000 Series B, MBIA Insured, 6.15%, 03/15/19 ....................................... 285,463
430,000 Lockport Town, Public Improvement, MBIA Insured, 5.40%, 03/01/10 ............... 417,262
155,000 Mahopac Central School District, AMBAC Insured, 6.80%, 06/15/08 ................ 174,242
210,000 Middle Country Central School District, New York Centereach, AMBAC Insured,
6.90%, 12/15/06 ............................................................... 238,541
2,000,000 Monroe County IDAR, Nazareth College Facilities Revenue, MBIA Insured,
6.00%, 06/01/20 ............................................................... 1,992,160
Monroe County Public Improvement G.O.,
985,000 AMBAC Insured, 6.15%, 06/01/18 ................................................ 1,006,906
1,730,000 AMBAC Insured, 6.15%, 06/01/19 ................................................ 1,768,475
$ 1,055,000 Mount Sinai Union Free School District, Refunding, AMBAC Insured, 6.20%, 02/15/13
$ 1,101,082
Nassau County GO, Refunding,
210,000 Series C, FGIC Insured, 5.875%, 08/01/16 ...................................... 210,067
300,000 Series D, FGIC Insured, 5.875%, 05/15/16 ...................................... 300,084
1,150,000 Nassau County IDA, Civic Facilities Revenue, Hofstra University Project, AMBAC
Insured, 6.75%, 08/01/11....................................................... 1,218,782
Nassau County Sewer District,
370,000 Refunding, Series E, MBIA Insured, 5.45%, 05/01/15 ............................ 351,903
275,000 Series G, MBIA Insured, 5.40%, 01/15/11 ....................................... 266,019
New Rochelle,
195,000 Series C, MBIA Insured, 6.25%, 03/15/21 ....................................... 201,427
390,000 Series C, MBIA Insured, 6.25%, 03/15/22 ....................................... 402,854
530,000 Series C, MBIA Insured, 6.25%, 03/15/23 ....................................... 547,469
555,000 Series C, MBIA Insured, 6.25%, 03/15/24 ....................................... 573,293
100,000 New York City Educational Construction Fund Revenue, Series A, MBIA Insured,
Pre-Refunded, 7.125%, 04/01/13 ................................................ 111,665
New York City GO,
300,000 FGIC Insured, 7.25%, 02/01/06 ................................................. 311,546
50,000 Series C-1, MBIA Insured, 6.625%, 08/01/12 .................................... 53,222
New York City Municipal Water Finance Authority, Water and Sewer System Revenue,
1,000,000 Series A, FGIC Insured, 6.75%, 06/15/16 ....................................... 1,047,210
465,000 Series A, FGIC Insured, 6.00%, 06/15/20 ....................................... 465,763
20,300,000 Series C, AMBAC Insured, 6.20%, 06/15/21 ...................................... 20,660,528
3,830,000 Series C, AMBAC Insured, 6.50%, 06/15/21 ...................................... 3,921,997
495,000 Series C, FGIC Insured, Pre-Refunded, 7.00%, 06/15/16 ......................... 561,795
New York City Trust, Cultural Resource Revenue, Refunding, Museum of Modern Art,
250,000 Series A, AMBAC Insured, 6.625%, 01/01/11 ..................................... 264,695
2,805,000 Series A, AMBAC Insured, 6.625%, 01/01/19 ..................................... 2,960,257
New York State Dormitory Authority Revenues,
140,000 Associated Children's, Inc., MBIA Insured, 7.60%, 07/01/18 .................... 151,988
2,460,000 Brooklin Law School, CGIC Insured, 6.40%, 07/01/11 ............................ 2,553,234
275,000 City University System, Series C, FGIC Insured, 7.00%, 07/01/14 ............... 299,483
600,000 Colgate University, Series A, MBIA Insured, 6.70%, 07/01/11 ................... 644,327
2,945,000 Comsewogue Public Library, MBIA Insured, 6.05%, 07/01/24 ...................... 2,954,925
2,000,000 Fordham University, FGIC Insured, 5.50%, 07/01/23 ............................. 1,870,300
750,000 Foundling Charitable Corp., MBIA Insured, 6.50%, 07/01/12 ..................... 772,380
1,000,000 Hamilton College, MBIA Insured, 6.50%, 07/01/21 ............................... 1,031,340
1,000,000 Hartwick College, MBIA Insured, 6.25%, 07/01/12 ............................... 1,032,570
2,780,000 Judicial Lease Facilities, Series B, MBIA Insured, 7.00%, 04/15/16 ............ 3,021,360
875,000 Leake and Watts Services, Inc., MBIA Insured, 6.00%, 07/01/23 ................. 877,774
2,580,000 Marist College, MBIA Insured, 6.00%, 07/01/12.................................. 2,597,750
New York State Dormitory Authority Revenues, (cont.)
$ 1,000,000 New York University, FGIC Insured, 6.25%, 07/01/09 ............................ $ 1,039,420
625,000 Refunding, Culinary Institute of America, Connie Lee Insured, 6.00%, 07/01/22 . 614,330
1,500,000 Refunding, Ithaca College, MBIA Insured, 6.25%, 07/01/21 ...................... 1,527,300
2,500,000 Refunding, Sinai School Medicine, MBIA Insured, 6.75%, 07/01/15 ............... 2,684,375
1,000,000 St. John's University, AMBAC Insured, 6.875%, 07/01/11 ........................ 1,082,700
2,500,000 State University Educational Facilities, Series A, FGIC Insured, 6.00%, 05/15/22 2,512,700
1,220,000 University of Rochester, MBIA Insured, 6.50%, 07/01/09 ........................ 1,259,882
New York State Energy Research and Development Authority, Electric Facilities
Revenue, Consolidated, Edison Co. of New York, Inc. Project,
4,000,000 Refunding, Series B, MBIA Insured, 5.25%, 08/15/20 ............................ 3,589,200
3,000,000 Series 1993, MBIA Insured, 6.00%, 03/15/28 .................................... 2,940,720
4,950,000 Series A, MBIA Insured, 6.75%, 01/15/27 ....................................... 5,127,309
210,000 Series C, MBIA Insured, 7.25%, 11/01/24 ....................................... 219,622
New York State Energy Research and Development Authority, Gas Facilities Revenue,
Brooklyn Union Gas,
3,050,000 Series II, MBIA Insured, 7.00%, 12/01/20 ...................................... 3,193,015
2,240,000 Series A, MBIA Insured, 6.75%, 02/01/24 ....................................... 2,355,360
New York State Energy Research and Development Authority, PCR, Refunding,
4,000,000 bElectric and Gas Project, Series A, MBIA Insured, 6.15%, 07/01/26 ............. 3,948,920
1,500,000 Niagara Mohawk Power Corp., Series A, FGIC Insured, 6.625%, 10/01/13........... 1,575,945
5,000,000 Niagara Mohawk Power Corp., Series A, FGIC Insured, 7.20%, 07/01/29............ 5,578,250
1,150,000 Rochester Gas and Electric Project, Series A, MBIA Insured, 6.35%, 05/15/32 ... 1,178,026
1,000,000 Rochester Gas and Electric Project, Series B, MBIA Insured, 6.50%, 05/15/32 ... 1,024,210
New York State Environmental Facilities Corp., Water Facilities Revenue,
Spring Valley Water Co., Inc. Project,
2,000,000 Series A, AMBAC Insured, 6.30%, 08/01/24....................................... 2,026,920
3,000,000 Series B, AMBAC Insured, 6.15%, 08/01/24....................................... 3,004,590
New York State Medical Care Facilities Finance Agency Revenue,
6,735,000 Long-Term Health Care, Series A, CGIC Insured, 6.80%, 11/01/14 ................ 7,108,456
5,355,000 Long-Term Health Care, Series B, CGIC Insured, 6.45%, 11/01/14 ................ 5,532,358
4,245,000 Long-Term Health Care, Series C, CGIC Insured, 6.40%, 11/01/14................. 4,371,204
1,000,000 Mental Health Service Facilities Improvement, Series D, 5.90%, 08/15/22 ....... 981,360
1,000,000 Our Lady of Victory Hospital, Series A, AMBAC Insured, 6.625%, 11/01/16........ 1,043,010
1,000,000 Refunding, Hospital and Nursing Home Mortgage, Series C, MBIA Insured,
6.25%, 08/15/12 .............................................................. 1,023,600
1,495,000 Refunding, St. Mary's Hospital Project, Series A, AMBAC Insured,
6.20%, 11/01/14 .............................................................. 1,533,780
700,000 Sisters of Charity Hospital, Series A, AMBAC Insured, 6.60%, 11/01/10 ......... 735,994
1,500,000 Sisters of Charity Hospital, Series A, AMBAC Insured, 6.625%, 11/01/18 ........ 1,564,515
New York State Power Authority Revenue and General Purpose,
$ 2,000,000 Refunding, Series Z, FGIC Insured, 6.50%, 01/01/19 ............................ $ 2,075,120
3,000,000 Series AA, MBIA Insured, 6.25%, 01/01/23 ...................................... 3,061,230
3,255,000 Series Y, AMBAC Insured, 6.50%, 01/01/11 ...................................... 3,417,91
New York State Thruway Authority, General Revenue,
1,000,000 Series C, FGIC Insured, 6.00%, 01/01/15 ....................................... 1,000,810
12,975,000 Series C, FGIC Insured, 6.00%, 01/01/25 ....................................... 12,885,992
1,000,000 New York State Thruway Authority, Highway and Bridges Trust Fund, Series B,
FGIC Insured, 6.00%, 04/01/14 ................................................. 1,000,670
7,500,000 Niagara Falls Bridge Commission Toll Revenue, Refunding, Series B, FGIC Insured,
5.25%, 10/01/21................................................................ 6,724,125
Niagara Falls Public Improvement,
1,000,000 MBIA Insured, 6.85%, 03/01/19 ................................................. 1,077,520
500,000 MBIA Insured, 6.90%, 03/01/20 ................................................. 538,665
500,000 MBIA Insured, 6.90%, 03/01/21 ................................................. 538,665
1,200,000 Niagara Falls Water Treatment Plant, MBIA Insured, 7.00%, 11/01/12 ............. 1,289,256
Niagara Frontier Transportation Authority, Airport Revenue, Greater Buffalo
International Airport,
1,000,000 Series A, AMBAC Insured, 6.25%, 04/01/24 ...................................... 1,013,140
500,000 Series C, AMBAC Insured, 6.00%, 04/01/24 ...................................... 502,695
North Hempstead GO, Refunding,
210,000 Series A, FGIC Insured, 6.40%, 02/01/11 ....................................... 223,682
1,065,000 Series B, FGIC Insured, 6.40%, 04/01/15 ....................................... 1,138,102
1,060,000 Series B, FGIC Insured, 6.40%, 04/01/16 ....................................... 1,128,063
North Hempstead Public Improvement, GO,
195,000 Series A, MBIA Insured, 5.375%, 05/15/14 ...................................... 184,275
470,000 Series A, MBIA Insured, 5.375%, 05/15/15 ...................................... 443,417
500,000 North Hempstead Solid Waste Management Revenue, Refunding, Series B,
MBIA Insured, 5.00%, 02/01/12 ................................................. 457,755
1,125,000 Oneonta HDC, Mortgage Revenue, Refunding, Oneonta SF, Series A, MBIA Insured,
5.45%, 07/01/22 ............................................................... 995,040
100,000 Onondaga Central School District, MBIA Insured, 6.80%, 06/15/10 ................ 111,495
75,000 Ontario County GO, Series A, FGIC Insured, 6.50%, 05/15/11 ..................... 81,613
Oyster Bay Public Improvement, GO,..............................................
550,000 Series A, FGIC Insured, 5.60%, 04/15/11 ....................................... 538,676
500,000 Series A, FGIC Insured, 5.60%, 04/15/12 ....................................... 489,315
375,000 Series A, FGIC Insured, 5.60%, 04/15/13 ....................................... 366,709
300,000 Series A, FGIC Insured, 5.60%, 04/15/14 ....................................... 291,492
300,000 Series A, FGIC Insured, 5.60%, 04/15/15 ....................................... 289,545
175,000 Series A, FGIC Insured, 5.60%, 04/15/16 ....................................... 168,742
Oyster Bay Public Improvement, GO, (cont.)
$175,000 Series A, FGIC Insured, 5.60%, 04/15/17 ....................................... $ 167,559
175,000 Series A, FGIC Insured, 5.60%, 04/15/18 ....................................... 167,395
175,000 Series A, FGIC Insured, 5.60%, 04/15/19 ....................................... 167,241
Port Authority of New York and New Jersey,
1,000,000 Consolidated 71st Series, AMBAC Insured, 6.50%, 01/15/26 ...................... 1,035,640
1,600,000 Consolidated 71st Series, MBIA Insured, 6.50%, 01/15/26 ....................... 1,661,632
4,230,000 Consolidated 76th Series, AMBAC Insured, 6.50%, 11/01/26 ...................... 4,359,523
2,000,000 Puerto Rico Commonwealth Electric Power Authority Revenue, Water Resources,
Series R, CGIC Insured, 6.25%, 07/01/17 ....................................... 2,037,080
Puerto Rico HFC, SFMR,
850,000 Portfolio 1-D, GNMA/MBS, 6.75%, 10/15/14 ...................................... 882,020
525,000 Portfolio 1-D, GNMA/MBS, 6.85%, 10/15/24 ...................................... 544,698
810,000 Rensselear County GO, AMBAC Insured, 6.70%, 02/15/11 ........................... 892,928
Riverhead GO,
140,000 Series B, AMBAC Insured, 5.00%, 06/15/10 ...................................... 129,562
130,000 Series B, AMBAC Insured, 5.00%, 06/15/11 ...................................... 119,271
130,000 Series B, AMBAC Insured, 5.00%, 06/15/12 ...................................... 118,871
40,000 Rome GO, AMBAC Insured , 6.375%, 03/01/05 ...................................... 43,528
125,000 Royalton Water Improvement, MBIA Insured, 6.40%, 02/15/12 ...................... 132,918
Schenevus Central School District,
330,000 Series 1991, AMBAC Insured, 6.45%, 06/15/08 ................................... 357,146
330,000 Series 1991, AMBAC Insured, 6.45%, 06/15/09 ................................... 355,222
330,000 Schodack Central School District, AMBAC Insured, 6.875%, 12/15/10 .............. 371,267
100,000 Schuylerville Central School District, MBIA Insured, 6.875%, 06/15/07 .......... 113,326
100,000 South Glens Falls Central School District, Series A, MBIA Insured, 6.85%, 06/15/10 111,995
Suffolk County GO, Public Improvement,
500,000 Refunding, Series B, FGIC Insured, 6.20%, 05/01/11 ............................ 517,090
500,000 Refunding, Series B, FGIC Insured, 6.20%, 05/01/13 ............................ 515,345
365,000 Series 1989, FGIC Insured, Pre-Refunded, 6.50%, 07/15/13 ...................... 388,943
Suffolk County Water Authority Waterworks Revenue, Refunding,
1,000,000 AMBAC Insured, Pre-Refunded, 7.10%, 06/01/10 .................................. 1,112,670
3,000,000 Series B, AMBAC Insured, 5.625%, 06/01/16 ..................................... 2,904,930
Sullivan County GO, Public Improvement,
505,000 MBIA Insured, 5.20%, 03/15/14 ................................................. 467,938
520,000 MBIA Insured, 5.20%, 03/15/15 ................................................. 480,735
510,000 MBIA Insured, 5.20%, 03/15/16 ................................................. 467,609
500,000 MBIA Insured, 5.20%, 03/15/17 ................................................. 457,434
Triborough Bridge and Tunnel Authority Revenue,
1,500,000 Series Q, AMBAC Insured, 6.00%, 01/01/13 ...................................... 1,505,805
740,000 Series S, FGIC Insured, Pre-Refunded, 7.00%, 01/01/21 ......................... 833,890
Triborough Bridge and Tunnel Authority Revenue, (cont.)
$ 175,000 Series T, AMBAC Insured, Pre-Refunded, 7.00%, 01/01/20 ........................ $ 197,885
1,900,000 Series T, AMBAC Insured, Pre-Refunded, 6.00%, 01/01/22 ........................ 2,027,661
1,100,000 Series T, MBIA Insured, Pre-Refunded, 7.00%, 01/01/20 ......................... 1,243,847
4,475,000 Series X, AMBAC Insured, 6.50%, 01/01/19 ...................................... 4,652,165
2,750,000 Series X, MBIA Insured, 6.50%, 01/01/19 ....................................... 2,858,872
Warrensburg Central School District,
250,000 Series II, AMBAC Insured, 6.25%, 06/15/08 ..................................... 267,187
250,000 Series II, AMBAC Insured, 6.25%, 06/15/09 ..................................... 264,328
250,000 Series II, AMBAC Insured, 6.25%, 06/15/10 ..................................... 262,408
440,000 Washington County Public Improvement, FGIC Insured, 6.375%, 10/15/10 ........... 467,654
65,000 Williamsville Central School District, MBIA Insured, 6.50%, 12/01/10 ........... 70,278
Total Bonds (Cost $232,273,721)................................................. 238,628,440
aShort Term Investments1.6%
New York City Municipal Water Financial Authority and Sewer System Revenue,
1,100,000 Series C, Daily VRDN and Put, 4.25%, 06/15/22 ................................. 1,100,000
100,000 Series C, Daily VRDN and Put, 4.25%, 06/15/23 ................................. 100,000
1,400,000 Series G, Daily VRDN and Put, 4.10%, 06/15/24 ................................. 1,400,000
1,200,000 New York State Energy Research and Development Authority PCR, Refunding,
New York Electric and Gas Co., Series B, Daily VRDN and Put, 4.20%, 02/01/29 ... 1,200,000
--------------
Total Short Term Investments (Cost $3,800,000).............................. 3,800,000
--------------
Total Investments (Cost $236,073,721) 100.1%........................... 242,428,440
Liabilities in Excess of Other Assets, Net (.1)%....................... (219,631)
--------------
Net Assets 100.0%...................................................... $242,208,809
==============
At June 30, 1995, the net unrealized appreciation based on the
cost of investments for income tax purposes of $236,075,000 was as follows:
Aggregate gross unrealized appreciation for all investments in which there was
an excess of value over tax cost.............................................. $ 8,183,040
Aggregate gross unrealized depreciation for all investments in which there was
an excess of tax cost over value............................................... (1,829,600)
-------------
Net unrealized appreciation..................................................... $ 6,353,440
=============
</TABLE>
PORTFOLIO ABBREVIATIONS:
AMBAC - American Municipal Bond Assurance Corp.
CGIC - Capital Guaranty Insurance Co.
COP - Certificate of Participation
ETM - Escrow to Maturity
FGIC - Financial Guaranty Insurance Corp.
GNMA - Government National Mortgage Association
GO - General Obligation
HDC - Housing Development Corp.
HFC - Housing Financial Corp.
IDA - Industrial Development Authority/Agency
IDAR - Industrial Development Authority/Agency Revenue
MBIA - Municipal Bond Investors Assurance Corp.
MBS - Mortgage-Backed Securities
PCR - Pollution Control Revenues
SF - Single Family
SFMR - Single Family Mortgage Revenues
USD - Unified School District
a Variable rate demand notes (VRDN's) are tax-exempt obligations which contain a
floating or variable interest rate adjustment formula and an unconditional right
of demand to receive payment of the principal balance plus accrued interest upon
short notice prior to specified dates. The interest rate may change on specified
dates in relationship with changes in a designated rate (such as the prime
interest rate or U.S. Treasury bills rate).
b See Note 1 regarding securities purchased on a when-issued basis.
The accompanying notes are an integral part of these financial statements.
FRANKLIN NEW YORK TAX-FREE TRUST
Statement of Investments in Securities and Net Assets, June 30, 1995 (unaudited)
<TABLE>
<CAPTION>
Face Value
Amount Franklin New York Intermediate-Term Tax-Free Income Fund (Note 1)
Bonds 101.7%
<S> <C> <C>
Buffalo General Improvement,
$ 555,000 Series D, AMBAC Insured, 5.80%, 12/01/03 ....................................... $ 585,125
555,000 Series D, AMBAC Insured, 5.90%, 12/01/04 ....................................... 587,806
590,000 Series D, AMBAC Insured, 6.00%, 12/01/05 ....................................... 625,087
100,000 Cortland County IDA, Civic Facility Revenue, Cortland Memorial Hospital, Inc. Project,
6.15%, 07/01/02 ................................................................ 100,787
85,000 Franklin County IDA, Lease Revenue, Correctional Facility Project, 6.375%, 11/01/02 88,026
260,000 Guam Airport Authority Revenue, Refunding, Series A, 6.00%, 10/01/03 ............ 263,507
2,000,000b Guam Government GO, Series A, 5.70%, 09/01/03 ................................... 1,971,680
1,300,000 Guam Power Authority Revenue, Series A, 6.00%, 10/01/04 ......................... 1,309,932
Metropolitan Transportation Authority Service,
1,000,000 Contract Commuter Facilities, Series 7, 5.40%, 07/01/06 ........................ 963,100
935,000 Contract Commuter Facilities, Series O, 5.375%, 07/01/02 ....................... 927,744
New York City GO,
5,200,000 Refunding, Series A, 6.375%, 08/01/05 .......................................... 5,251,324
3,500,000 Series H, 7.00%, 02/01/06 ...................................................... 3,713,325
New York City IDA, Civic Facility Revenue,
460,000 New York Blood Center, Inc. Project, 6.80%, 05/01/02 ........................... 490,884
1,875,000 USTA National Tennis Center Project, FSA Insured, 6.00%, 11/15/03 .............. 1,995,094
1,675,000 USTA National Tennis Center Project, FSA Insured, 6.10%, 11/15/04 .............. 1,791,848
4,010,000 New York State COP, Commissioner General Services Department, 6.50%, 03/01/00 ... 4,197,347
New York State Dormitory Authority Revenues,
690,000 Department of Health, 6.25%, 07/01/04 .......................................... 711,011
735,000 Department of Health, 6.30%, 07/01/05 .......................................... 753,596
100,000 Refunding, City University, Series U, 6.25%, 07/01/02 .......................... 103,890
1,720,000 Refunding, City University, Series U, 6.35%, 07/01/04 .......................... 1,795,284
New York State Medical Care Facilities, Finance Agency Revenue,
1,500,000 Hospital and Nursing Home, FHA Insured, 5.70%, 02/15/05 ........................ 1,546,905
675,000 Refunding, Huntington Hospital Mortgage Project, Series A, 5.90%, 11/01/04 ..... 675,891
935,000 Secured Hospital, Series A, 5.70%, 02/15/04 .................................... 919,975
960,000 Secured Hospital, Series A, 5.70%, 08/15/04 .................................... 943,901
140,000 New York State, Refunding, 7.50%, 11/15/01 ...................................... 158,688
1,900,000 New York State Tollway Authority General Revenue, Series A, 5.80%, 01/01/06 ..... 1,933,060
Northern Mariana Islands Commonwealth Port Authority, Seaport Revenue,
410,000 Series A, 5.85%, 10/01/03 ...................................................... 402,616
430,000 Series A, 5.95%, 10/01/04 ...................................................... 421,589
460,000 Series A, 6.05%, 10/01/05 ...................................................... 450,349
485,000 Series A, 6.15%, 10/01/06 ...................................................... 474,189
125,000 Oneida-Herkimer Solid Waste Management, Solid Waste Authority Systems Revenue,
Refunding, 6.65%, 04/01/05 ..................................................... 129,975
Puerto Rico Commonwealth Electric Power Authority Revenue,
$ 100,000 Refunding, Series Q, 5.90%, 07/01/01 ........................................... $ 104,029
1,500,000 Water Resources, Series T, 6.00%, 07/01/04 ..................................... 1,548,300
1,000,000 Puerto Rico Commonwealth GO, 6.00%, 07/01/05 .................................... 1,027,950
Puerto Rico Municipal Finance Agency,
300,000 Series A, 5.875%, 07/01/06 ..................................................... 303,228
300,000 Series A, FSA Insured, 5.60%, 07/01/05 ......................................... 310,908
Suffolk County IDA, Civic Facilities Revenue,
100,000 Dowling College Facilities, 6.10%, 06/01/03 .................................... 101,810
180,000 Dowling College Facilities, 6.20%, 06/01/04 .................................... 183,560
1,500,000 Suffolk County Water Authority, Refunding, Waterworks Revenue, 5.10%, 06/01/05 .. 1,484,986
350,000 United Nations Development Corp. Revenue, Refunding, Series A, 5.70%, 07/01/02 .. $ 362,002
-----------
Total Bonds (Cost $40,607,723) .................................................. 41,710,308
-----------
a Short Term Investments .7%
300,000 New York City Municipal Water Finance Authority, Water and Sewer System Revenue,
Series C, FGIC Insured, Daily VRDN and Put, 4.25%, 06/15/22 (Cost $300,000) .... 300,000
-----------
Total Investments (Cost $40,907,723)102.4%........................... 42,010,308
Liabilities in Excess of Others Assets, Net(2.4%).................... (999,393)
------------
Net Assets 100.0%................................................... $41,010,915
============
At June 30, 1995, the net unrealized appreciation based on the cost of investments
for income tax purposes of $40,907,723 was as follows:
Aggregate gross unrealized appreciation for all investments in which there was an
excess of value over tax cost................................................ $ 1,242,303
Aggregate gross unrealized depreciation for all investments in which there was an
excess of tax cost over value................................................ (139,718)
------------
Net unrealized appreciation................................................... $ 1,102,585
============
</TABLE>
PORTFOLIO ABBREVIATIONS:
AMBAC - American Municipal Bond Assurance Corp.
COP - Certificate of Participation
FGIC - Financial Guaranty Insurance Co.
FHA - Federal Housing Authority/Agency
FSA - Financial Security Assistance
GO - General Obligation
IDA - Industrial Development Authority/Agency
a Variable rate demand notes (VRDN's) are tax-exempt obligations which
contain a floating or variable interest rate adjustment formula and an
unconditional right of demand to receive payment of the principal balance
plus accrued interest upon short notice prior to specified dates. The
interest rate may change on specified dates in relationship with changes in
a designated rate (such as the prime interest rate or U.S. Treasury bills
rate).
b See Note 1 regarding securities purchased on a when-issued basis.
The accompanying notes are an integral part of these financial statements.
FRANKLIN NEW YORK TAX-FREE TRUST
Financial Statements
Statements of Assets and Liabilities
for the six months ended June 30, 1995 (unaudited)
<TABLE>
<CAPTION>
Franklin New York Franklin New York Franklin New York
Tax-Exempt Insured Tax-Free Intermediate-Term
Money Fund Income Fund Tax-Free Income Fund
----------------- ----------------- --------------------
<S> <C> <C> <C>
Assets:
Investment in securities:
At identified cost................................... $59,732,176 $236,073,721 $40,907,723
=========== ============ ===========
At value............................................. 59,732,176 242,428,440 42,010,308
Cash.................................................. 98,763 68,614 255,114
Receivables:
Interest............................................. 350,894 4,077,115 810,319
Capital shares sold.................................. -- 320,562 20,954
Unamortized organization costs (Note 2)............... -- 1,726 --
----------- ----------- -----------
Total assets..................................... 60,181,833 246,896,457 43,096,695
----------- ----------- -----------
Liabilities:
Payables:
Investment securities purchased:
When-issued basis (Note 1)............................ -- 4,002,733 1,997,727
Dividend to shareholders............................. 5,717 334,898 64,262
Capital shares repurchased........................... -- 137,648 --
Management fees...................................... 20,446 127,746 7,988
Distribution fees.................................... -- 28,550 5,883
Shareholder servicing costs.......................... 6,340 4,878 120
Accrued expenses and other liabilities................ 16,278 51,195 9,800
----------- ----------- -----------
Total liabilities................................ 48,781 4,687,648 2,085,780
----------- ----------- -----------
Net assets, at value................................... $60,133,052 $242,208,809 $41,010,915
=========== =========== ===========
Net assets consist of:
Undistributed net investment income................... $ -- $ 149,765 $ 155,085
Unrealized appreciation on investments................ -- 6,354,719 1,102,585
Accumulated net realized loss......................... -- (3,664,360) (2,880,133)
Capital shares........................................ 60,133,052 239,368,685 42,633,378
----------- ----------- -----------
Net assets, at value................................... $60,133,052 $242,208,809 $41,010,915
=========== =========== ===========
Class I shares:
Net assets, at value.................................. $60,133,052 $242,181,310 $41,010,915
=========== =========== ===========
Shares outstanding.................................... 60,133,052 22,060,206 4,077,315
=========== =========== ===========
Net asset value per share*............................ $1.00 $10.98 $10.06
=========== =========== ===========
Class II shares:
Net assets, at value.................................. -- $ 27,499 --
=========== =========== ===========
Shares outstanding.................................... -- 2,497 --
=========== =========== ===========
Net asset value per share*............................ -- $11.01 --
=========== =========== ===========
</TABLE>
*Redemption price per share is equal to net asset value less any applicable
contingent deferred sales charge.
The accompanying notes are an integral part of these financial statements.
FRANKLIN NEW YORK TAX-FREE TRUST
Financial Statements (cont.)
Statements of Operations
for the six months ended June 30, 1995 (unaudited)
<TABLE>
<CAPTION>
Franklin New York Franklin New York Franklin New York
Tax-Exempt Insured Tax-Free Intermediate-Term
Money Fund Income Fund Tax-Free Income Fund
----------------- ----------------- --------------------
<S> <C> <C> <C>
Investment income:
Interest (Note 1)..................................... $1,146,187 $ 7,283,784 $ 1,098,940
----------- ----------- -----------
Expenses:
Management fees, net (Note 6)......................... 87,826 546,945 18,395
Distribution fees - Class I (Note 6).................. -- 84,562 15,141
Distribution fees - Class II (Note 6)................. -- 2 --
Shareholder servicing costs........................... 37,219 21,687 708
Reports to shareholders............................... 41,190 47,724 5,473
Professional fees..................................... 5,301 13,464 2,978
Registration and filing fees.......................... 5,948 13,325 7,420
Custodian fees........................................ 3,577 11,969 3,024
Trustees' fees and expenses........................... 1,027 3,346 --
Amortization of organization costs (Note 2)........... -- 1,035 --
Other................................................. 2,740 23,192 3,893
----------- ----------- -----------
Total expenses......................................... 184,828 767,251 57,032
----------- ----------- -----------
Net investment income.................................. 961,359 6,516,533 1,041,908
----------- ----------- -----------
Realized and unrealized gain (loss) on investments:
Net realized loss..................................... -- (1,520,771) (69,013)
Net unrealized appreciation during the period......... -- 19,707,748 1,674,194
----------- ----------- ------------
Net realized and unrealized gain on investments........ -- 18,186,977 1,605,181
----------- ----------- ------------
Net increase in net assets resulting from operations... $ 961,359 $24,703,510 $2,647,089
=========== =========== ============
</TABLE>
The accompanying notes are an integral part of these financial statements.
FRANKLIN NEW YORK TAX-FREE TRUST
Financial Statements (cont.)
Statements of Changes in Net Assets for the six months ended June 30, 1995
(unaudited) and the year ended December 31, 1994
<TABLE>
<CAPTION>
Franklin New York
Franklin New York Franklin New York Insured Intermediate-Term
Tax-Exempt Money Fund Tax-Free Income Fund Tax-Free Income Fund
---------------------- ------------------------- ---------------------
Six months Year Six months Year Six months Year
ended ended ended ended ended ended
06/30/95 12/31/94 06/30/95 12/31/94 06/30/95 12/31/94
-------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Increase (decrease) in
net assets:
Operations:
Net investment income....... $ 961,359 $ 1,250,396 $ 6,516,533 $ 13,500,814 $ 1,041,908 $ 2,059,002
Net realized loss from
security transactions...... -- -- (1,520,771) (2,000,409) (69,013) (2,703,012)
Net unrealized appre-
ciation (depreciation)
on investments............. -- -- 19,707,748 (33,236,184) 1,674,194 (1,406,329)
---------- ---------- ---------- ---------- ---------- ----------
Net increase
(decrease) in net
assets resulting
from operations......... 961,359 1,250,396 24,703,510 (21,735,779) 2,647,089 (2,050,339)
Distributions to
shareholders from:
Undistributed net
investment income -
Class I..................... (961,359) (1,250,396) (6,553,175) (13,359,615) (1,014,003) (1,950,786)
Undistributed net
investment income -
Class II.................... -- -- (11) -- -- --
Increase (decrease) in net
assets from capital share
transactions (Note 4)......... (4,701,896) 14,517,973 (1,002,459) (3,490,386) 4,211,908 8,005,349
---------- ---------- ---------- ---------- ---------- ----------
Net increase
(decrease) in
net assets............. (4,701,896) 14,517,973 17,147,865 (38,585,780) 5,844,994 4,004,224
Net assets:
Beginning of period........... 64,834,948 50,316,975 225,060,944 263,646,724 35,165,921 31,161,697
---------- ---------- ---------- ---------- ---------- ----------
End of period................. $60,133,052 $64,834,948 $242,208,809 $225,060,944 $41,010,915 $35,165,921
========== ========== ========== ========== ========== ==========
Undistributed net investment
income included in
net assets:
Beginning of period.......... $ -- $ -- $ 186,418 $ 45,219 $ 127,180 $ 18,964
========== ========== ========== ========== ========== ==========
End of period................ $ -- $ -- $ 149,765 $ 186,418 $ 155,085 $ 127,180
========== ========== ========== ========== ========== ==========
</TABLE>
The accompanying notes are an integral part of these financial statements.
FRANKLIN NEW YORK TAX-FREE TRUST
Notes to Financial Statements (unaudited)
1. SIGNIFICANT ACCOUNTING POLICIES
Franklin New York Tax-Free Trust ("the Trust") is a non-diversified, open-end
management investment company (mutual fund), registered under the Investment
Company Act of 1940 as amended. The Trust currently consists of three separate
funds (the Funds): Franklin New York Tax-Exempt Money Fund (the "Money Fund"),
Franklin New York Insured Tax-Free Income Fund (the "Insured Fund"), and
Franklin New York Intermediate-Term Tax-Free Income Fund (the "Intermediate-Term
Fund"). Each of the funds issues a separate series of the Trust's shares and
maintains a totally separate investment portfolio.
The Insured Fund offers two classes of shares, Class I and Class II. Class I
shares are sold with a higher front-end sales charge. Class II shares are sold
with a lower front-end sales charge, but may be subject to a contingent deferred
sales charge. Each class of shares has the same rights, except with respect to
the effect of the respective sales charges, the distribution fees borne by each
class, voting rights on matters affecting a single class, and the exchange
privilege of each class.
The offering of Class II shares began May 1,1995, at which time all previously
outstanding shares became Class I shares. Realized and unrealized gains or
losses and net investment income, other than class specific expenses, are
allocated daily to each class of shares based upon the relative proportion of
net assets of each class.
The following is a summary of significant accounting policies consistently
followed by the Trust in the preparation of its financial statements. The
policies are in conformity with generally accepted accounting principles for
investment companies.
a. Security Valuations: Tax-free bonds generally trade in the over-the-counter
market rather than on a national securities exchange. Often there are no
transactions in a particular security on any given day. In the absence of a
recorded sale or reported bid and ask prices, information with respect to bond
and note transactions, quotations from bond dealers, market transactions in
comparable securities, and various relationships between securities are used to
determine the value of the security. The Trust may utilize a pricing service,
bank, or broker/dealer experienced in such matters to perform any of the pricing
functions, under procedures approved by the Board of Trustees. Other securities
for which market quotations are not available, if any, are valued in accordance
with procedures established by the Board of Trustees.
The Money Fund must maintain a dollar weighted average maturity of 90 days or
less and only purchases instruments having remaining maturities of 397 days or
less. If the Money Fund's portfolio has a remaining weighted average maturity of
greater than 90 days, the portfolio will be stated at value based on recorded
closing sales on a national securities exchange or, in the absence of a recorded
sale, within the range of the most recent quoted bid and ask prices. The
Trustees have established procedures designed to stabilize, to the extent
reasonably possible, the Money Fund's price per share as computed for the
purpose of sales and redemptions at $1.00.
b. Municipal Bonds or Notes with "Puts": The Trust has purchased municipal bonds
or notes with the right to resell the bonds or notes to the seller at an agreed
upon price or yield on a specified date or within a specified period (which will
be prior to the maturity date of the bonds or notes). Such a right to resell is
commonly known as a "put". In determining the weighted average maturity of the
Fund's portfolio, municipal bonds and notes as to which the Fund holds a put are
deemed to mature on the first day on which the put may be exercisable.
c. Variable Rate Demand Notes: The Trust has invested in certain variable
interest rate demand notes with maturities greater than 397 days but which are
redeemable at specified intervals upon demand. The maturity of these instruments
for the purposes of calculating the Fund's weighted average maturity is
considered to be the lesser of the period until the interest rate is adjusted or
until the principal can be recovered by demand.
d. Income Taxes: The Trust intends to continue to qualify for the tax treatment
applicable to regulated investment companies under the Internal Revenue Code and
to make the requisite distributions to its shareholders which will be sufficient
to relieve it from income and excise taxes. Therefore, no income tax provision
is required. Each Fund is treated as a separate entity in the determination of
compliance with the Internal Revenue Code.
1. SIGNIFICANT ACCOUNTING POLICIES (cont.)
e. Security Transactions: Security transactions are accounted for on the date
the securities are purchased or sold (trade date). Realized gains and losses on
security transactions are determined on the basis of specific identification for
both financial statement and income tax purposes.
f. Investment Income, Expenses and Distributions: Distributions to shareholders
are recorded on the ex-dividend date. Interest income and estimated expenses are
accrued daily. Bond discount and premium, if any, are amortized as required by
the Internal Revenue Code. The Funds normally declare dividends from their net
investment income daily and distribute monthly. Daily allocations of net
investment income will commence on the date of receipt of an investor's funds.
Dividends are normally declared each day the New York Stock Exchange is open for
business and are equal to an amount per day set from time to time by the Board
of Trustees, and are payable to shareholders of record at the beginning of
business on the ex-date. Once each month, dividends are reinvested in additional
shares of the Funds or paid in cash as requested by the shareholders.
For the Money Fund, net investment income includes income, calculated on an
accrual basis, amortization of original issue and market discount or premium (if
any), and estimated expenses which are accrued daily. The total available for
dividends is computed daily and includes the net investment income, plus or
minus any gains or losses on security transactions and changes in unrealized
portfolio appreciation or depreciation, (if any).
g. Securities Purchased on a When-Issued Basis: The Trust may trade securities
on a when-issued or delayed delivery basis, with payment and delivery scheduled
for a future date. These transactions are subject to market fluctuations and are
subject to the risk that the value at delivery may be more or less than the
trade date purchase price. Although the Trust will generally purchase these
securities with the intention of acquiring such securities, they may sell such
securities before the settlement date. These securities are identified on the
accompanying statement of investments in securities and net assets. The Trust
has set aside sufficient investment securities as collateral for these purchase
commitments.
h. Insurance: Each long-term municipal security in the Insured Fund is insured
as to the scheduled payments of interest and principal by either a mutual fund
Portfolio Insurance Policy, a Secondary Market Insurance Policy, a New Issue
Insurance Policy or collateral guaranteed by an agency of the U.S. government.
The providers of secondary market and new issue insurance are rated "AAA" by
Standard & Poor's.
Premiums for a mutual fund Portfolio Insurance Policy or a Secondary Market
Insurance Policy are paid from the Insured Fund's assets. Premiums for a mutual
fund Portfolio Insurance Policy (effective only so long as the Insured Fund is
in existence, Financial Guaranty (the insurer) remains in business and the
municipal security insured under the policy continues to be held by the Insured
Fund) will reduce the current income on the portfolio by the amount thereof.
Premiums paid by the Insured Fund for a Secondary Market Insurance Policy
(effective so long as the security so insured is outstanding and the insurer
remains in business) are added to the cost basis of the municipal security
insured and are not considered an expense of the Insured Fund. Premiums for a
New Issue Insurance Policy (effective so long as the security so insured is
outstanding and the insurer remains in business) are paid in advance by the
insured security issuer or by another third party prior to acquisition of the
security by the Insured Fund and are not considered an expense of the Insured
Fund.
i. Expense Allocation: Common expenses incurred by the Trust are allocated among
the Funds based on the ratio of net assets of each Fund to the combined net
assets. In all other respects, expenses are charged to each Fund as incurred on
a specific identification basis.
2. UNAMORTIZED ORGANIZATION COSTS
The organization costs of the Insured Fund are amortized on a straight-line
basis over a period of five years from May 1, 1991 (the effective date of
registration under the Securities Act of 1933). In the event Franklin Resources,
Inc. (which was the sole shareholder prior to May 1, 1991) redeems its shares
within the five-year period, the pro-rata share of the then-unamortized deferred
organization costs will be deducted from the redemption price paid to Franklin
Resources, Inc. New investors purchasing shares of the Insured Fund subsequent
to that date bear such costs during the amortization period only as such charges
are accrued daily against investment income.
3. DISTRIBUTIONS AND CAPITAL LOSS CARRYOVERS
At December 31, 1994, for tax purposes, the Trust had capital loss carryovers as
follows:
<TABLE>
<CAPTION>
Franklin New York Franklin New York
Insured Tax-Free Intermediate-Term
Income Fund Tax-Free Income Fund
----------------- --------------------
<S> <C> <C>
Capital loss carryovers expiring in:
1999...................................... $ 5,995 $ --
2000...................................... 64,646 4,489
2001...................................... 70,510 103,619
2002...................................... 2,001,159 2,703,012
----------- -----------
$ 2,142,310 $ 2,811,120
=========== ===========
</TABLE>
For income tax purposes, the aggregate cost of securities is higher (and
unrealized appreciation is lower) than for financial reporting purposes at June
30, 1995 by $1,279 in the Insured Fund.
4. TRUST SHARES
At June 30, 1995, there was an unlimited number of no par value shares of
beneficial interest authorized. Transactions in each of the Funds' Class I and
Class II shares for the six months ended June 30, 1995 and for the year ended
December 31, 1994 were as follows:
Class I Shares
<TABLE>
<CAPTION>
Franklin New York
Franklin New York Franklin New York Insured Intermediate-Term
Tax-Exempt Money Fund Tax-Free Income Fund Tax-Free Income Fund
--------------------- ------------------------- --------------------
Shares Amount Shares Amount Shares Amount
-------- --------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Six Months Ended June 30, 1995
Shares sold.................. 19,883,778 $ 19,883,778 1,087,144 $ 11,788,375 574,321 $ 5,777,592
Shares issued in reinvestment
of distributions............ 961,412 961,412 332,481 3,603,627 62,678 624,929
Shares redeemed.............. (23,586,556) (23,586,556) (1,317,694) (14,247,121) (209,752) (2,078,023)
Changes from exercise of
exchange privilege:
Shares sold................ 5,705,572 5,705,572 271,836 2,901,724 98,731 976,460
Shares redeemed............ (7,666,102) (7,666,102) (469,791) (5,076,891) (109,982) (1,089,050)
---------- ---------- ---------- ---------- ---------- ----------
Net increase (decrease) (4,701,896) $ (4,701,896) (96,024) $ (1,030,286) 415,996 $ 4,211,908
========== ========== ========== ========== ========== ==========
</TABLE>
4. TRUST SHARES (cont.)
Class I Shares (cont.)
<TABLE>
<CAPTION>
Franklin New York
Franklin New York Franklin New York Insured Intermediate-Term
Tax-Exempt Money Fund Tax-Free Income Fund Tax-Free Income Fund
---------------------- ------------------------- --------------------
Shares Amount Shares Amount Shares Amount
-------- -------- -------- -------- ------- --------
<S> <C> <C> <C> <C> <C> <C>
Year Ended December 31, 1994
Shares sold.................. 38,939,892 $ 38,939,892 3,127,880 $ 34,361,316 1,267,735 $ 13,094,484
Shares issued in reinvestment
of distributions............ 1,251,287 1,251,287 647,592 6,924,569 116,416 1,170,687
Shares redeemed.............. (45,837,955) (45,837,955) (3,750,439) (39,940,981) (778,367) (7,709,591)
Changes from exercise of
exchange privilege:
Shares sold................ 41,909,526 41,909,526 884,949 9,428,345 792,323 8,057,615
Shares redeemed............ (21,744,777) (21,744,777) (1,325,530) (14,263,635) (653,877) (6,607,846)
---------- ---------- ---------- ---------- ---------- ----------
Net increase (decrease). 14,517,973 $14,517,973 (415,548) $ (3,490,386) 744,230 $ 8,005,349
========== ========== ========== ========== ========== ==========
</TABLE>
Class II Shares Franklin New York Insured
Tax-Free Income Fund
-------------------------
Shares Amount
-------- ---------
May 1, 1995 to June 30, 1995
Shares sold.................. 2,497 $27,826
Shares issued in reinvestment
of distributions............ -- 1
-------- ---------
Net increase......... 2,497 $27,827
======== =========
5. PURCHASES AND SALES OF SECURITIES
Aggregate purchases and sales of securities (excluding purchases and sales of
short-term securities) for the six months ended June 30, 1995 were as follows:
<TABLE>
<CAPTION>
Franklin New York Franklin New York Franklin New York
Tax-Exempt Insured Tax-Free Intermediate-Term
Money Fund Income Fund Tax-Free Income Fund
----------------- ----------------- --------------------
<S> <C> <C> <C>
Purchases................. -- $37,077,877 $9,513,851
========== ========== ============
Sales..................... -- $35,218,223 $3,676,644
========== ========== ============
</TABLE>
6. TRANSACTIONS WITH AFFILIATES AND RELATED PARTIES
Franklin Advisers, Inc., under the terms of an agreement, provides investment
advice, administrative services, office space and facilities to each Fund, and
receives fees computed monthly on the net assets of the Insured Fund and the
Intermediate-Term Fund at the last day of the month and computed daily on the
net assets of the Money Fund as follows:
<TABLE>
<CAPTION>
Annualized Fee Rate Net Assets
------------------- ---------------------------------------------------
<S> <C>
.625 of 1% First $100 million
.500 of 1% over $100 million, up to and including $250 million
.450 of 1% over $250 million
</TABLE>
The terms of the management agreement provide that aggregate annual expenses of
the Funds be limited to the extent necessary to comply with the limitations set
forth in the laws, regulations and administrative interpretations of the states
in which the Funds' shares are registered. The Funds' expenses did not exceed
these limitations; however, for the six months ended June 30, 1995, Franklin
Advisers, Inc. agreed in advance to waive a portion of the management fees for
the Money Fund, the Insured Fund, and the Intermediate-Term Fund of $103,572,
$114,703, and $98,922, respectively.
In its capacity as underwriter for the shares of the Funds, Franklin/Templeton
Distributors, Inc. received commissions on sales of the Funds' shares.
Commissions are deducted from the gross proceeds received from the sale of the
Trust's shares, and as such are not expenses of the Funds. Franklin/Templeton
Distributors, Inc. may also make payments, out of its own resources, to dealers
for certain sales of Class I and Class II shares. Commissions received by
Franklin/Templeton Distributors, Inc. and the amounts paid to other dealers for
the six months ended June 30, 1995 were as follows:
<TABLE>
<CAPTION>
Franklin New York Franklin New York
Insured Tax-Free Intermediate-Term
Income Fund Tax-Free Income Fund
----------------- --------------------
Class I Class II Class I
------- -------- -------
<S> <C> <C> <C>
Total commissions received............... $420,471 $274 $75,879
======== ==== =======
Paid to other dealers.................... $397,739 $280 $66,678
======== ==== =======
</TABLE>
Under the terms of a shareholder services agreement with Franklin/Templeton
Investor Services, Inc., the Trust pays costs on a per shareholder account
basis. Shareholder servicing costs incurred for the six months ended June 30,
1995 aggregated $59,614, of which $58,981 was paid to Franklin/Templeton
Investor Services, Inc.
Under the terms of a Distribution Agreement pursuant to Rule 12b-1 of the
Investment Company Act of 1940, which was effective May 1,1994 for Class I
shares and which became effective on May 1, 1995 for Class II shares, the
Insured Fund and the Intermediate-Term Fund will reimburse Franklin/Templeton
Distributors, Inc., in an amount up to 0.10% per annum of each Fund's average
daily net assets for costs incurred in the promotion, offering and marketing of
the Fund's shares. For the six months ended June 30, 1995 fees incurred by the
Insured Fund and the Intermediate-Term Fund under the agreement totaled $84,564
and $15,141, respectively.
Certain officers and trustees of the Trust are also officers and/or directors of
Franklin/Templeton Distributors, Inc., Franklin Advisers, Inc., and
Franklin/Templeton Investor Services, Inc., all wholly-owned subsidiaries of
Franklin Resources, Inc.
7. CREDIT RISKS
Although each of the Funds has a diversified investment portfolio, all of their
investments are in the securities of issuers in the state of New York, Guam and
Puerto Rico, which may subject the Funds to economic and fiscal changes
occurring within those areas.
8. FINANCIAL HIGHLIGHTS
Selected data for each share outstanding throughout each year, by Fund, are as
follows:
<TABLE>
<CAPTION>
Per Share Operating Performance Ratios/Supplemental Data
-------------------------------------------- --------------------------
Ratio of Net
Net Asset Net Realized Total Distributions Net Asset Net Assets Ratio of Investment
Period Value at Net & Unrealized From From Net Value at at End Expenses Income Portfolio
Ended Beginning Investment Gain (Loss) Investment Investment End of Total of Year to Average to Average Turnover
Dec. 31 of Period Income on Securities Operations Income Period Return++ (in 000's) Net Assets+ Net Assets Rate
------------------------------------------------------------------------------------------------------------------------------------
Franklin New York Tax-Exempt Money Fund:
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1990 $ 1.00 $.050 $ -- $ .050 $(.050) $ 1.00 5.13% $ 92,277 .59% 5.02% -- %
1991 1.00 .036 -- .036 (.036) 1.00 3.63 70,503 .69 3.52 --
1992 1.00 .021 -- .021 (.021) 1.00 2.10 54,122 .65 2.12 --
1993 1.00 .017 -- .017 (.017) 1.00 1.67 50,317 .63 1.68 --
1994 1.00 .021 -- .021 (.021) 1.00 2.11 64,835 .60 2.12 --
19953 1.00 .016 -- .016 (.016) 1.00 1.57 60,133 .60* 3.13* --
Franklin New York Insured Tax-Free Income Fund:
Class I shares:
19911 10.00 .247 .433 .680 (.220) 10.46 6.75 37,904 .12* 5.69* 21.12
1992 10.46 .620 .369 .989 (.649) 10.80 9.49 149,054 .33 5.80 3.39
1993 10.80 .600 .880 1.480 (.600) 11.68 13.79 263,647 .50 5.28 5.38
1994 11.68 .590 (1.525) (.935) (.585) 10.16 (8.19) 225,061 .56 5.48 25.66
19953 10.16 .300 .817 1.117 (.297) 10.98 6.33 242,181 .65* 5.49* 14.99
Class II shares:
19954 10.85 .094 .154 .248 (.088) 11.01 .01 27 1.23* 4.91* 14.99
Franklin New York Intermediate-Term Tax-Free Income Fund:
19922 10.00 .090 .135 .225 (.015) 10.21 2.25 3,459 -- 4.41* 20.80
1993 10.21 .480 .536 1.016 (.546) 10.68 10.18 31,162 -- 4.96 30.95
1994 10.68 .550 (1.104) (.554) (.526) 9.60 (5.42) 35,166 .05 5.57 188.38
19953 9.60 .280 .452 .732 (.272) 10.06 7.51 41,011 .31* 5.60* 10.04
*Annualized
1For the period May 1, 1991 (effective date of registration) to December 31,
1991.
2For the period September 21, 1992 (effective date of registration) to December
31, 1992.
3For the six months ended June 30, 1995.
4For the period May 1,1995 to June 30, 1995.
++Total return measures the change in value of an investment over the periods
indicated. It is not annualized. It does not include the maximum initial sales
charge or the deferred contingent sales charge, and assumes reinvestment of
dividends and capital gains, if any, at net asset value. Prior to May 1, 1994,
dividends were reinvested at the maximum offering price for the Insured Fund.
</TABLE>
8. FINANCIAL HIGHLIGHTS (cont.)
+During the periods indicated below, Franklin Advisers, Inc., the investment
manager, agreed to waive in advance a portion of its management fees and made
payments of other expenses incurred by the Funds. Had such action not been
taken, the ratio of operating expenses to average net assets would have been as
follows:
Ratio of expenses to
average net assets
--------------------
Franklin New York Tax-Exempt
Money Fund:
1990................................ .79%
1991................................ .84
1992................................ .89
1993................................ .97
1994................................ .93
19953............................... .94*
Franklin New York Insured Tax-Free
Income Fund:
Class I:
19911............................... .79%
1992................................ .74
1993................................ .65
1994................................ .71
19953............................... .74*
Class II:
19953............................... 1.32%*
Franklin New York Intermediate-Term
Tax-Free Income Fund:
19922............................... 1.76%*
1993................................ .73
1994................................ .80
19953............................... .84*
Franklin New York Tax-Free Trust
APPENDIX
DESCRIPTION OF GRAPHIC MATERIAL OMITTED FROM EDGAR FILING
(PURSUANT TO ITEM 304(a) of REGULATION S-T)
GRAPHIC MATERIAL (1)
This bar chart shows the comparison between the fund's Class I distribution rate
of 5.13% and the taxable equivalent distribution rate of 9.66%.
GRAPHIC MATERIAL (2)
This bar chart shows the comparison between the fund's seven-day annualized
yield of 3.39% and the taxable equivalent yield of 6.38%.
GRAPHIC MATERIAL (3)
This bar chart shows the comparison between the fund's Class II distribution
rate of 4.64% and the taxable equivalent rate of 8.74%.
GRAPHIC MATERIAL (4)
This bar chart shows the comparison between the fund's distribution rate of
5.36% and the taxable equivalent rate of 10.09%.
GRAPHIC MATERIAL (5)
This chart shows in pie chart format the fund's breakdown by quality as a
percentage of total net assets.
Quality Breakdown on 6/30/95
AAA 22.5%
A 36.2%
BBB 41.3%
