ALLIANCE MUNICIPAL INCOME FUND
SEMI-ANNUAL REPORT
APRIL 30, 1996
LETTER TO SHAREHOLDERS ALLIANCE MUNICIPAL INCOME FUND
_______________________________________________________________________________
June 3, 1996
Dear Shareholder:
We're pleased to provide you with an update on municipal market activity and
the investment results for each of the five Portfolios of Alliance Municipal
Income Fund. The following pages include information that covers the period
from November 1, 1995, the beginning of the fiscal year, through April 30,
1996. During the six months, the Portfolios have provided high current tax-free
income and favorable total returns.
MARKET OVERVIEW
After posting superb performance results in fiscal year 1995, Alliance
Municipal Income Fund continued to perform well during the first half of fiscal
year 1996. A decline in the supply of new tax-exempt bond issues, combined with
ongoing strong demand, helped the municipal sector to do well in comparison to
other fixed-income investments. Also responsible for the relative
outperformance of long-term municipal bonds was a shift in focus from 'flat
tax' proposals to other issues in the ongoing public debate over tax reform.
After posting very strong returns through the end of February, municipal bond
prices followed the lead of the Treasury market and slipped in early March. The
decline was due to signs of a strengthening economy as well as diminishing
hopes for further short-term interest rate cuts by the Federal Reserve Board.
Despite generally rising interest rates, municipal bonds performed well due to
several key market factors. The tax reform debate, which had caused municipals
to underperform the market at times during the 1995 market rally, reversed
course in the first quarter of 1996. As we've seen in the past, tax reform
debate can lead institutional investors (who do not typically buy municipal
bonds) into the market, which is what happened in the last several months as
tax-exempt yields began to rise to levels on par with taxable yields.
Individual buyers also returned to the municipal market after a prolonged
absence, lured by higher overall yields and positive developments in the debate
over federal tax code reform.
Tax reform continues to be debated during this election year. We believe that
while the current tax code may be changed some time in the next several years,
any reform will be incremental in nature and will not drastically alter the tax
benefits associated with municipal bond investing. Furthermore, long-term bond
prices today appear to take into account the enactment of significant tax
reform legislation that would be negative for the municipal market. Should this
major tax reform legislation fail, municipal investors could benefit
considerably as the yield advantage over taxable investments would once again
rise. Furthermore, municipal bond income should remain exempt from state income
taxes in the state of issuance.
The improving U.S. economic performance experienced in the first quarter is
positive for state and local governments and should facilitate the meeting of
budgetary targets for fiscal year 1996. However, going forward, revenue growth
is expected to be modest which will require state and local governments to keep
expenditures under tight control. Fiscal flexibility will probably be further
constrained by voter antipathy toward many types of new tax-based spending.
This mood by tax payers should keep new issue supply at a minimum which will
bode well for market stability and long-term performance.
INVESTMENT STRATEGY
The recent rise in interest rates has once again provided an opportunity to
reposition the Portfolios to take advantage of long-term trends in the economy
and the municipal bond market. Specifically, we continue to sell older bonds
with lower yields, shorter maturities and unfavorable early redemption features
in favor of securities which offer higher tax-free income and better call
protections. Our strategy of selling securities which have appreciated in price
because of improvement in the credit of the issuer and/or market conditions,
while looking for undervalued situations, has proven to be successful again in
the first half of 1996. Consistent with our fundamental investment objective of
providing high current income and high after-tax total returns for the Fund's
shareholders, we continue to be fully invested in long-term tax-exempt bonds.
MARKET OUTLOOK
The goods news for municipal bond investors is that inflation is expected to
remain benign despite a recent surge in commodity prices. We expect interest
rates to trade in a narrow range with some potential for volatility related to
the election year. We would view any backup in interest rates as a buying
opportunity for investors.
1
ALLIANCE MUNICIPAL INCOME FUND
_______________________________________________________________________________
Moreover, we believe that with the population aging, demographic trends show
that the personal savings rate will continue to increase as will demand for
income-generating investment products. This should increase the demand for
municipal bonds and will most likely mean excellent long-term performance for
investors that currently own municipal bonds.
We believe that the long-term bull market for bonds will continue through the
remainder of the decade. The current interest rate environment provides
investors with new opportunities to lock in very attractive yields. We believe
that any potential short-term interest rate risk will be offset by the
potential for high current income and long-term capital appreciation.
Notwithstanding the uncertainties of an election year or possible tax reform,
we believe that the Fund should continue to deliver outstanding investment
results in 1996.
Thank you for your continued interest in Alliance Municipal Income Fund. As
always, if you have questions concerning your account or other matters, please
contact your financial advisor or call us at (800) 221-5672. We look forward to
reporting to you again later in the year.
Sincerely,
John D. Carifa
Chairman and President
Susan P. Keenan
Senior Vice President
2
ALLIANCE MUNICIPAL INCOME FUND
_______________________________________________________________________________
HOW YOUR PORTFOLIO PERFORMED OVER THE PAST SIX MONTHS
The Portfolios' Class A shares total returns for the periods ended April 30 are
shown below. We've also shown, for comparison, returns for the overall
municipal bond market, represented by the unmanaged Lehman Brothers Long
Municipal Bond Index, which includes approximately 15,000 issues with
maturities exceeding 22 years. Current yields and returns for Class B and Class
C shares are on page 4.
CUMULATIVE TOTAL RETURNS CLASS A SHARES
PERIODS ENDED APRIL 30, 1996
PAST 6 MONTHS PAST 12 MONTHS
------------- --------------
NATIONAL PORTFOLIO +0.63% +8.37%
INSURED NATIONAL PORTFOLIO +1.25% +8.16%
NEW YORK PORTFOLIO +0.93% +8.15%
CALIFORNIA PORTFOLIO +1.33% +8.73%
INSURED CALIFORNIA PORTFOLIO -0.61% +6.77%
LB LONG MUNICIPAL BOND INDEX +1.05% +8.80%
TOTAL RETURNS ARE BASED ON THE NET ASSET VALUES OF EACH CLASS OF SHARES AS OF
APRIL 30.
OBJECTIVE AND POLICIES
The five Portfolios of Alliance Municipal Income Fund, by investing principally
in high-yielding, predominantly medium quality municipal securities, seek to
provide their shareholders with the highest level of income exempt from Federal
and state tax that is available without assuming undue risk. These securities
generally offer current yield above those of higher quality municipal
obligations.
3
INVESTMENT RESULTS
AS OF APRIL 30, 1996 (UNAUDITED) ALLIANCE MUNICIPAL INCOME FUND
_______________________________________________________________________________
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS
---------------------------------------------------------- TAXABLE
WITHOUT SALES CHARGE WITH SALES CHARGE EQUIVALENT
---------------------------- ---------------------------- 30-DAY YIELD IN 36%
1 5 SINCE 1 5 SINCE SEC TAX BRACKET+
YEAR YEARS INCEPTION* YEAR YEARS INCEPTION* YIELD+ (AT NAV)
------ ------ ---------- ------ ------ ---------- ------ ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
NATIONAL PORTFOLIO
Class A Shares +8.37% +7.79% +7.95% +3.80% +6.86% +7.45% 5.44% 8.83%
Class B Shares +7.55 N/A +5.26 +4.55 N/A +5.26 4.97 7.78
Class C Shares +7.56 N/A +4.36 +7.56 N/A +4.36 4.98 7.80
INSURED NATIONAL
PORTFOLIO
Class A Shares +8.16% +7.69% +7.52% +3.55% +6.76% +7.02% 4.82% 8.14%
Class B Shares +7.34 N/A +5.44 +4.34 N/A +5.44 4.32 7.11
Class C Shares +7.34 N/A +4.44 +7.34 N/A +4.44 4.33 7.11
NEW YORK PORTFOLIO
Class A Shares +8.15% +7.48% +6.90% +3.55% +6.56% +6.40% 5.56% 9.05%
Class B Shares +7.35 N/A +4.76 +4.35 N/A +4.76 5.09 7.86
Class C Shares +7.35 N/A +3.69 +7.35 N/A +3.69 5.10 7.86
CALIFORNIA PORTFOLIO
Class A Shares +8.73% +7.56% +7.80% +4.15% +6.64% +7.29% 5.53% 8.86%
Class B Shares +7.92 N/A +5.45 +4.92 N/A +5.45 5.08 7.70
Class C Shares +7.93 N/A +4.56 +7.93 N/A +4.56 5.08 7.70
INSURED CALIFORNIA
PORTFOLIO
Class A Shares +6.77% +7.03% +7.62% +2.20% +6.12% +7.18% 4.98% 8.19%
Class B Shares +6.04 N/A +4.57 +3.04 N/A +4.57 4.49 6.97
Class C Shares +5.96 N/A +3.50 +5.96 N/A +3.50 4.50 6.97
</TABLE>
The average annual total returns reflect investment of dividends and/or capital
gains distributions in additional shares with and without the effect of the
4.25% maximum sales charge (Class A) or applicable contingent deferred sales
charge for Class B (3% year 1, 2% year 2, 1% year 3, 0% year 4); Class C shares
are not subject to front-end or contingent deferred sales charges. Past
performance does not guarantee future results. Investment return and principal
value will fluctuate so that an investor's shares, when redeemed, may be worth
more or less than their original cost.
* Inception: Insured California Portfolio Class A Shares, 11/85; all other
Portfolios' Class A Shares, 12/86; Class B Shares, 1/93; Class C Shares, 5/93.
+ Yields are for the 30 days ended April 30, 1996.
4
NATIONAL PORTFOLIO
PORTFOLIO OF INVESTMENTS
APRIL 30, 1996 (UNAUDITED) ALLIANCE MUNICIPAL INCOME FUND
_______________________________________________________________________________
STANDARD & PRINCIPAL
POOR'S AMOUNT
RATINGS+ (000) VALUE
- -------------------------------------------------------------------------------
MUNICIPAL BONDS-100.7%
ALASKA-0.9%
AAA Alaska International Arpt
MBIA Ser 1 AMT
5.50%, 10/01/15 $ 6,500 $ 6,136,975
ARIZONA-4.9%
AA+ Maricopa Cnty IDA
Util Rev (Citizen's Util) Ser 95 AMT
6.20%, 5/01/30 8,185 8,269,142
AA+ Mohave Cnty IDA
Util Rev (Citizen's Util) Ser 93B AMT
5.80%, 11/15/28 2,000 1,918,220
AA- Mohave Cnty IDR
(Cargill/No Star Steel Proj) Ser 95A AMT
6.70%, 3/01/20 10,155 10,639,698
BBB Navajo Cnty PCR
(Arizona Pub Serv) Ser 93A
5.875%, 8/15/28 3,540 3,300,838
AA+ Phoenix Sr Lien
(Civic Plaza Bldg Corp) Ser 94
6.00%, 7/01/12 3,635 3,695,450
A Pinal Cnty IDA
Waste Disp (Browning-Ferris) Ser 96 AMT
5.00%, 2/01/06 2,750 2,641,072
AA Salt River Proj
(Agri Imp & Pwr Dist Elec Sys) Ser 92
5.75%, 1/01/19 1,610 1,562,263
-----------
32,026,683
CALIFORNIA-13.9%
A California Poll Ctl Fin Auth
PCR (Pacific Gas & Elec) Ser 93A-B AMT
5.875%, 6/01/23 48,345 45,155,197
5.85%, 12/01/23 45,000 41,865,300
BBB- Orange Cnty Sr Lien
Foothill/Eastern
Transportation Corridor Ser 95A
Zero coupon, 1/01/25 15,000 2,200,500
Zero coupon, 1/01/27 10,000 1,283,100
Zero coupon, 1/01/28 10,000 1,200,000
-----------
91,704,097
COLORADO-5.6%
Baa* Arapahoe Cnty
Public Highway Auth
7.00%, 8/31/26 11,830 12,427,415
AAA Denver City & Cnty
(Arpt System Rev) MBIA Ser 91D AMT
7.75%, 11/15/21 15,435 17,316,372
AAA Denver City & Cnty
(Arpt System Rev) MBIA Ser 92B AMT
7.25%, 11/15/23 6,375 7,003,193
-----------
36,746,980
FLORIDA-3.5%
NR Collier Cnty IDR
(Southern St Util) Ser 96 AMT
6.50%, 10/01/25 1,905 1,827,886
AAA Dade Cnty Arpt Rev
(Miami Int'l Arpt) MBIA Ser 95B AMT
6.00%, 10/01/24 2,380 2,376,620
A Duval Cnty HFA
MFHR (St Augustine Apts)
5.90%, 9/01/16 1,000 971,110
AAA Florida HFA
SFMR (Mtg Hsg Fin Agy) Ser 94B AMT
6.65%, 7/01/26 4,655 4,814,201
AAA Hillsborough Cnty Aviation
Arpt Rev (Tampa Int'l) FGIC Ser 93D AMT
5.40%, 10/01/13 5,000 4,709,200
BBB+ Lake Cnty Res Rec
(NRG Recovery Grp) Ser 93A AMT
5.95%, 10/01/13 2,650 2,488,695
AAA Volusia Cnty Arpt Systems
(Daytona Beach Int'l) MBIA Ser 93 AMT
5.625%, 10/01/21 2,000 1,890,260
Baa* Volusia Cnty Educ Fac Auth
(Embry-Riddle Aero Univ) Ser 96A
6.125%, 10/15/26 3,860 3,758,636
-----------
22,836,608
GEORGIA-4.8%
AAA Atlanta
Arpt Fac Rev
MBIA AMT
Zero coupon, 1/01/10 70,535 31,244,889
5
NATIONAL PORTFOLIO
PORTFOLIO OF INVESTMENTS (CONTINUED) ALLIANCE MUNICIPAL INCOME FUND
_______________________________________________________________________________
STANDARD & PRINCIPAL
POOR'S AMOUNT
RATINGS+ (000) VALUE
- -------------------------------------------------------------------------------
ILLINOIS-0.8%
AAA Chicago Int'l Arpt Spec Fac
(O'Hare Int'l Terminal) MBIA AMT
6.75%, 1/01/18 $ 5,020 $ 5,285,709
INDIANA-8.1%
BB Indianapolis Arpt Auth
(United Airlines Maint Ctr Proj)
Ser 95A AMT
6.50%, 11/15/31 41,570 40,889,499
AA Warrick Cnty PCR
(So Indiana Gas & Elec) Ser 93B AMT
6.00%, 5/01/23 12,290 12,257,309
-----------
53,146,808
LOUISIANA-0.2%
BBB St Charles Parish
(Louisiana Pwr & Light) Ser 93A AMT
6.20%, 5/01/23 1,650 1,557,418
MARYLAND-0.2%
NR Maryland Ind Dev Fin Auth
(Med Waste Assoc) Ser 89 AMT
8.75%, 11/15/10 1,475 1,524,398
MASSACHUSETTS-5.5%
AAA Massachusetts HFA
MFHR (Rental Hsg) AMBAC Ser 95E AMT
6.00%, 7/01/37 2,680 2,558,248
A+ Massachusetts Bay Trans Auth
Ser 92C
6.10%, 3/01/23 1,800 1,814,274
AAA Massachusetts Ed Fin Auth
Education Loan Rev AMBAC Ser 94E AMT
6.00%, 1/01/12 4,500 4,436,730
AAA Massachusetts HFA
MFHR (Harbor Point Dev) AMBAC Ser 96A AMT
6.40%, 12/01/15 7,050 7,055,499
A+ Massachusetts HFA
SFMR Ser 40 AMT
6.65%, 12/01/27 9,005 9,159,616
AAA Massachusetts Ind Fin Auth
MFHR (Heights Crossing) FHA Ser 95 AMT
6.15%, 2/01/35 5,730 5,509,108
AA- Massachusetts Wtr Pollution Abatement
(South Essex Prog) Ser 94A
6.375%, 2/01/15 2,520 2,611,224
A Massachusetts Wtr Res Auth
Ser 92B
5.50%, 11/01/15 3,260 3,031,669
-----------
36,176,368
MICHIGAN-6.1%
AAA Detroit Eco Dev Corp
Res Rec FSA Ser 91A AMT
6.875%, 5/01/09 3,765 3,968,461
BBB Detroit GO
Ser 93
6.35%, 4/01/14 3,665 3,669,655
AAA Kent Cnty Arpt Rev GO
(Kent Cnty Int'l) Ser 95 AMT
6.10%, 1/01/25 4,405 4,404,515
A+ Michigan HDA
MFHR (Rental Hsg) Ser 94B
5.80%, 4/01/19 2,000 1,919,200
AA+ Michigan HDA
SFMR (Mortgage Rev) Ser 96B AMT
6.20%, 6/01/27 5,805 5,788,688
A+ Michigan Hosp Fin Auth
Hosp Rev (Crittenton Hosp) Ser 93A
5.25%, 3/01/14 3,335 3,012,405
A Michigan Hosp Fin Auth
Hosp Rev (Detroit Med Ctr) Ser 93B
5.50%, 8/15/23 5,250 4,705,470
AA Michigan Muni Bond Auth
Revolving Fund Ser 93
5.40%, 10/01/14 4,385 4,149,920
A- Michigan Strategic Fund PCR
(General Motors Corp) Ser 95
6.20%, 9/01/20 2,900 2,902,001
AAA Monroe Cnty PCR
(Detroit Edison) MBIA Ser 1-B AMT
6.55%, 9/01/24 1,000 1,032,250
6
ALLIANCE MUNICIPAL INCOME FUND
_______________________________________________________________________________
STANDARD & PRINCIPAL
POOR'S AMOUNT
RATINGS+ (000) VALUE
- -------------------------------------------------------------------------------
AAA Wayne Cnty Arpt Rev
(Detroit Metro Arpt) MBIA AMT
5.50%, 12/01/21 $ 3,350 $ 3,095,233
6.75%, 12/01/21 1,500 1,583,460
-----------
40,231,258
MINNESOTA-1.6%
BBB+ Bass Brook PCR
(Minnesota Pwr & Light) Ser 92
6.00%, 7/01/22 1,370 1,336,339
AA+ Duluth GO
Arpt Lease Ser 95C AMT
6.25%, 8/01/14 4,150 4,237,067
AAA Minneapolis GO
SFMR (Home Ownership) Ser 93 Stage III AMT
5.70%, 12/01/23 500 471,530
AA+ Minnesota HFA
SFMR (Home Mortgage) Ser 93-C2 AMT
6.15%, 7/01/23 2,505 2,456,153
AA+ Rochester Hosp
(Mayo Med Ctr) Ser 92F
6.25%, 11/15/21 2,000 2,023,640
-----------
10,524,729
NEBRASKA-1.7%
A Nebraska Higher Ed
Student Loan Rev Ser 93B AMT
5.875%, 6/01/14 11,705 11,220,530
NEW JERSEY-4.4%
AAA Cape May Cnty PCR
(Atlantic City Elec Co) MBIA Ser 94A AMT
7.20%, 11/01/29 5,000 5,479,800
AAA New Jersey Eco Dev Auth
(Elizabethtown Wtr Co) MBIA Ser 95 AMT
5.60%, 12/01/25 3,650 3,363,840
AA- New Jersey Eco Dev Auth
Swr Rev (Anheuser-Busch) Ser 95 AMT
5.85%, 12/01/30 6,200 5,816,840
AAA New Jersey Eco Dev Auth
(Hackensack Wtr Co) MBIA Ser 94B AMT
5.90%, 3/01/24 1,225 1,190,651
AAA New Jersey Eco Dev Auth
(NJ American Wtr Co) FGIC AMT
5.95%, 11/01/29 5,000 4,858,750
6.875%, 11/01/34 2,300 2,467,992
BBB New Jersey Hlth Care Fac Fin Auth Hosp Rev
(Englewood Hosp & Med Ctr) Ser 94
6.75%, 7/01/24 500 503,590
AAA New Jersey Hsg & Mtg Fin Agy
SFMR (Home Buyer Rev) MBIA AMT
6.35%, 10/01/27 5,000 5,035,950
-----------
28,717,413
NEW YORK-13.9%
BBB+ New York City GO
Ser 93A
6.25%, 8/01/18 6,000 5,824,080
BBB+ New York City GO
Ser 95B
7.25%, 8/15/19 8,250 8,798,048
BBB+ New York City GO
Ser 96J
6.00%, 2/15/24 10,580 9,928,272
A New York City Spec Fac
IDR (Terminal One LP) Ser 94 AMT
6.125%, 1/01/24 6,000 5,809,320
AAA Niagara Frontier Trans Auth Arpt Rev
(Gtr Buffalo Int'l) AMBAC Ser 94A AMT
6.25%, 4/01/24 5,000 5,069,650
A+ NYS Energy Res & Dev Auth
(Consolidated Edison) Ser 94A AMT
7.125%, 12/01/29 13,000 14,198,600
AAA NYS Energy Res & Dev Auth Gas Fac
(Brooklyn Union Gas) MBIA AMT
5.60%, 6/01/25 5,000 4,572,750
AAA NYS Energy Res & Dev Auth Solid Waste
(NYS Elec & Gas) MBIA Ser 93A AMT
5.70%, 12/01/28 25,050 23,403,714
7
NATIONAL PORTFOLIO
PORTFOLIO OF INVESTMENTS (CONTINUED) ALLIANCE MUNICIPAL INCOME FUND
_______________________________________________________________________________
STANDARD & PRINCIPAL
POOR'S AMOUNT
RATINGS+ (000) VALUE
- -------------------------------------------------------------------------------
BBB NYS Envir Fac Auth IDR
(Occidental Petroleum) Ser 93A AMT
5.70%, 9/01/28 $ 4,950 $ 4,411,192
AAA NYS Envir Fac Corp Wtr Fac
(Spring Valley Wtr) AMBAC Ser 94A AMT
6.30%, 8/01/24 1,400 1,419,866
AAA Port Auth of NY & NJ
Cons (96th Ser) FGIC AMT
6.60%, 10/01/23 7,250 7,611,847
-----------
91,047,339
OHIO-3.8%
AAA Columbus Arpt Rev
(Port Columbus Int'l) MBIA Ser 94A AMT
6.25%, 1/01/24 3,350 3,381,055
AAA Ohio Air Quality Dev Auth
(JMG Funding/Ohio Pwr Co)
AMBAC Ser 94B AMT
6.375%, 4/01/29 7,850 8,032,199
Baa3* Ohio Air Quality Dev Auth
PCR (Columbus So Pwr) Ser 85B
6.25%, 12/01/20 2,750 2,656,197
AA- Ohio Air Quality Dev Auth PCR
(Dayton Power & Light Proj) Ser 92B
6.40%, 8/15/27 1,900 1,956,297
AAA Ohio HFA
SFMR (Residential Mtg) GNMA Ser 94B-2 AMT
6.70%, 3/01/25 3,750 3,842,137
A Ohio Wtr Dev Auth Solid Waste
(North Star BHP) AMT
6.45%, 9/01/20 4,000 4,018,680
Aa3* Toledo-Lucas Cnty Port Auth IDR
(Cargill Inc. Proj)
5.90%, 12/01/15 1,100 1,088,604
-----------
24,975,169
PENNSYLVANIA-3.3%
AAA Allegheny Cnty Arpt
(Gtr Pittsburgh Int'l) FSA Ser 92B AMT
6.625%, 1/01/22 2,250 2,325,353
A New Morgan Solid Waste
(Browning-Ferris) Ser 94 AMT
6.50%, 4/01/19 1,300 1,328,457
BBB+ Pennsylvania Eco Dev Auth Waste Wtr
(Sun Co) Ser 94A AMT
7.60%, 12/01/24 700 771,197
AAA Pennsylvania Higher Ed Student Loan Rev
AMBAC Ser 88D AMT
6.05%, 1/01/19 8,200 8,204,838
AA+ Pennsylvania Hsg Fin Agy
SFMR (Home Mortgage) Ser 94-41B AMT
6.65%, 4/01/25 2,000 2,056,800
AAA Philadelphia Aprt Sys Rev
Ser 95A AMT
6.10%, 6/15/25 6,950 6,930,609
-----------
21,617,254
RHODE ISLAND-1.2%
AA+ Rhode Island Hsg & Mtg Fin Corp
SFMR ( Home Ownership) Ser 91-8
10.215%, 4/01/24 (a) 7,000 7,604,940
SOUTH DAKOTA-1.7%
AA+ South Dakota HDA SFMR
(Home Ownership Mtg) Ser 91D-93-II AMT
6.15%, 5/01/26 9,600 9,419,616
6.25%, 5/01/26 1,440 1,422,691
-----------
10,842,307
TENNESSEE-1.8%
BBB Memphis Shelby Cnty Spec Fac
(Federal Express) Ser 93 AMT
6.20%, 7/01/14 8,000 7,795,280
A* Volunteer Student Funding Educ Loan Rev
Ser 93C AMT
5.85%, 12/01/08 4,100 4,088,930
-----------
11,884,210
8
ALLIANCE MUNICIPAL INCOME FUND
_______________________________________________________________________________
STANDARD & PRINCIPAL
POOR'S AMOUNT
RATINGS+ (000) VALUE
- -------------------------------------------------------------------------------
TEXAS-1.2%
BB+ Alliance Arpt Auth Fac Imp
(American Airlines) Ser 90 AMT
7.50%, 12/01/29 $ 3,690 $ 3,914,463
BB+ Dallas-Ft Worth Arpt Fac Imp
(American Airlines) AMT
7.25%, 11/01/30 3,985 4,167,154
-----------
8,081,617
UTAH-2.1%
AAA Emery Cnty
PCR (Pacificorp Proj) AMBAC AMT
5.625%, 11/01/23 11,400 10,497,804
Aaa* Utah Board of Regents
Student Loan Rev Ser 93 AMT
5.90%, 11/01/13 3,600 3,549,816
-----------
14,047,620
VIRGINIA-5.2%
A Alexandria Redev & Hsg
MFHR (Buckingham Village) Ser 96A AMT
6.15%, 1/01/29 3,400 3,329,348
Aa* Chesapeake IDA
(Cargill Inc. Proj) Ser 93
5.875%, 3/01/13 1,765 1,737,978
A Henrico Cnty IDA
Solid Waste (Browning-Ferris Proj)
Ser 95 AMT
5.30%, 12/01/11 4,260 4,203,214
AA Henrico Cnty IDR
(Henrico Cnty Reg Jail) Ser 94
7.125%, 8/01/21 3,815 4,252,199
A- Isle of Wight Cnty IDA
Solid Waste (Union Camp Corp) Ser 94 AMT
6.55%, 4/01/24 3,770 3,866,323
AAA Metro Wash Arpt Auth
MBIA Ser 94A AMT
5.75%, 10/01/20 4,760 4,537,946
A Prince William Cnty IDA Hosp Rev
(Potomac Hosp Grp) Ser 95
6.75%, 10/01/15 2,250 2,318,423
AA Virginia Beach
Hosp Rev (Sentara Bayside)
6.30%, 11/01/21 400 405,232
AA Virginia College Bldg Auth Ed Fac Rev
(Washington & Lee)
5.80%, 1/01/24 3,500 3,378,270
AA+ Virginia HDA
SFMR (Commonwealth Mtg) Ser 93G AMT
5.35%, 7/01/16 5,490 5,015,499
AA Virginia Res Auth Swr
(Hopewell Fac) Ser 95A AMT
6.00%, 10/01/25 1,155 1,116,273
-----------
34,160,705
WASHINGTON-4.3%
BBB Pierce Cnty Eco Dev
PCR (Occidental Petroleum) Ser 93 AMT
5.80%, 9/01/29 6,755 5,980,269
BBB+ Pilchuck Dev Pub Corp Spec Fac
(BF Goodrich) Ser 93 AMT
6.00%, 8/01/23 24,000 22,590,480
-----------
28,570,749
TOTAL INVESTMENTS-100.7%
(cost $662,094,321) 661,912,773
Other assets less liabilities-(0.7%) (4,406,903)
NET ASSETS-100% $657,505,870
+ Unaudited.
* Moody's or Fitch Rating.
(a) Inverse floater securitythe interest rate is subject to change
periodically.
See Glossary of Terms on page 20.
See notes to financial statements.
9
INSURED NATIONAL PORTFOLIO
PORTFOLIO OF INVESTMENTS
APRIL 30, 1996 (UNAUDITED) ALLIANCE MUNICIPAL INCOME FUND
_______________________________________________________________________________
STANDARD & PRINCIPAL
POOR'S AMOUNT
RATINGS+ (000) VALUE
- -------------------------------------------------------------------------------
MUNICIPAL BONDS-99.7%
LONG TERM MUNICIPAL BONDS-96.2%
ALABAMA-8.1%
AAA West Jefferson PCR
(Alabama Power) MBIA Ser 93C
6.05%, 5/01/23 $19,000 $19,093,290
ALASKA-1.2%
A+ Alaska Hsg Fin Corp SFMR
Insured Mtg Prog Ser 93I
5.90%, 12/01/33 2,850 2,733,806
ARIZONA-7.0%
AAA Maricopa Cnty GO
Chandler Sch Imp #80 FGIC Ser 95
6.00%, 7/01/13 1,125 1,145,970
AAA Maricopa Cnty GO
Kyrene Elem Sch Imp #28 FGIC Ser 95B
6.00%, 7/01/14 2,000 2,022,920
AAA Maricopa Cnty GO
Sch Dist #28 FGIC Ser 93C
Zero coupon, 7/01/11 4,100 1,695,432
AAA Maricopa Cnty Hlth Fac
(Samaritan Hlth) MBIA Ser 90A
7.00%, 12/01/13 1,000 1,075,940
AAA Mohave Cnty IDA
(Baptist Hospital) Ser 96
5.75%, 9/01/26 600 578,292
AAA Oro Valley Wtr Sys Rev
(Municipal Property Corp)
5.375%, 7/01/26 1,600 1,475,808
AA Phoenix IDA MFHR
(Woodstone & SilverSprings)
Ser 93 Asset Gty
6.25%, 4/01/23 2,620 2,613,031
AAA Tempe IDR
(Mtg-Quadrangles) FHA Ser 93
6.25%, 6/01/26 4,775 4,768,219
AAA Yavapai Cnty GO
Humboldt Sch Imp #22 FGIC Ser 95A
5.95%, 7/01/14 1,120 1,124,424
-----------
16,500,036
CALIFORNIA-20.1%
AAA Fairfield Cnty Pub Fin Auth
Tax Alloc (Fairfield Proj) CGIC Ser 93C
5.50%, 8/01/23 $3,300 $3,062,928
AAA Fontana Pub Fin Auth
(No Fontana) MBIA Ser 93A
5.625%, 9/01/24 5,000 4,752,100
A Lancaster Redev Agy
MFHR (High Valley Apts) FHA Ser 96A
6.00%, 6/01/27 4,170 3,978,180
AAA Los Angeles Cnty
Metro Trans Auth MBIA Ser 93A
5.625%, 7/01/18 8,000 7,643,520
AAA Los Angeles Cnty Comm Redev Tax Alloc
(Bunker Hill Project) FSA Ser 93H
5.60%, 12/01/28 2,500 2,343,950
AAA Palm Springs ETM COP
Ser 91B
Zero coupon, 4/15/21 15,575 3,119,361
AAA Redding Elec Sys COP
Ser 92A
9.003%, 7/01/22 (a) 2,000 2,262,800
AAA Sacramento Muni Util
FGIC Ser 92A
8.818%, 8/15/18 (a) 2,500 2,643,275
AAA San Bernardino Cnty ETM
(Ontario Red Proj #1) MBIA Ser 93
5.80%, 8/01/23 10,000 9,602,700
AAA Univ of California Regents Hosp Rev
(UCLA Med Ctr) MBIA Ser 94
5.50%, 12/01/20 8,685 8,140,624
-----------
47,549,438
COLORADO-4.6%
AAA Denver City & Cnty Arpt System Rev
MBIA Ser 95A-96A
5.70%, 11/15/25 6,375 6,197,520
5.50%, 11/15/25 5,000 4,682,050
10,879,570
10
ALLIANCE MUNICIPAL INCOME FUND
_______________________________________________________________________________
STANDARD & PRINCIPAL
POOR'S AMOUNT
RATINGS+ (000) VALUE
- -------------------------------------------------------------------------------
FLORIDA-2.3%
AAA Florida Trpk Auth Rev
FGIC Ser 95A
5.625%, 7/01/25 $ 2,500 $ 2,387,900
AAA Pinellas Cnty Hlth Fac
(Morton Plant Hlth) MBIA
5.50%, 11/15/18 3,300 3,136,518
-----------
5,524,418
MASSACHUSETTS-14.1%
AAA Chelsea GO
AMBAC Ser 94
6.00%, 6/15/14 1,965 1,969,264
AAA Holyoke GO
FSA Ser 93B
6.125%, 8/01/13 945 965,951
AAA Lowell GO
FSA Ser 93A
5.50%, 1/15/10 3,485 3,412,512
AAA Massachusetts Elec Pwr Supply
MBIA Ser 92A
6.00%, 7/01/18 5,430 5,338,016
AAA Massachusetts GO
MBIA Ser 95A
5.75%, 2/01/15 4,490 4,428,756
AAA Massachusetts HFA
MFHR (Residential Dev) AMBAC Ser 93A
6.15%, 10/01/15 9,500 9,518,620
AAA Massachusetts HFA
MFHR (Residential Dev) FNMA Ser 92F
6.25%, 11/15/12 5,000 5,129,300
AAA Massachusetts HFA
SFMR (Residential Dev) FNMA Ser 92A
6.90%, 11/15/24 2,500 2,640,050
-----------
33,402,469
MICHIGAN-7.1%
AAA Brighton GO
Sch Dist Ser 92-II AMBAC
Zero coupon, 5/01/18 4,400 1,158,564
AAA Grand Rapids Swr Sys Rev
MBIA Ser 92
6.00%, 1/01/22 1,900 1,900,969
AAA Kalamazoo Hosp Fin Auth
(Borgess Med Ctr) FGIC Ser 94A
6.469%, 6/01/11 (a) 6,400 5,791,424
AAA Michigan Hosp Fin Auth
(St. John's Hospital) AMBAC Ser 92A
6.00%, 5/15/13 405 410,338
AAA Michigan Strategic Fund
PCR (Detroit Edison Co.) MBIA Ser 95AA
6.40%, 9/01/25 4,435 4,601,002
AAA Three Rivers GO
Sch Dist MBIA Ser 96
6.00%, 5/01/23 1,800 1,797,588
AA Troy Michigan Asset City
(Downtown Dev Auth) Ser 95A
6.375%, 11/01/18 225 225,270
AAA Yale GO Pub Sch Dist
AMBAC Ser 93
5.50%, 5/01/23 1,050 981,561
-----------
16,866,716
MINNESOTA-7.3%
AAA Burnsville-Eagan-Savage
GO (Ind Sch Dist #191) CGIC Ser 95A
6.20%, 2/01/17 1,150 1,184,247
AAA Lakeville GO
(Ind Sch Dist #194) FGIC Ser 93
5.60%, 2/01/18 3,605 3,447,570
AAA Minnesota HFA
MFHR (Rental Hsg) MBIA Ser 95D
6.00%, 2/01/22 3,630 3,615,444
AAA Minnesota Pub Fac Auth
(Wtr Poll Ctr Rev) Ser 95A
6.25%, 3/01/15 1,225 1,276,278
6.25%, 3/01/16 610 635,535
AAA No Minnesota Muni Pwr Agy
AMBAC Ser 92B
5.50%, 1/01/18 1,085 1,025,889
11
INSURED NATIONAL PORTFOLIO
PORTFOLIO OF INVESTMENTS (CONTINUED) ALLIANCE MUNICIPAL INCOME FUND
_______________________________________________________________________________
STANDARD & PRINCIPAL
POOR'S AMOUNT
RATINGS+ (000) VALUE
- -------------------------------------------------------------------------------
AAA Robbinsdale Hosp Rev
(No Memorial Med Ctr) AMBAC Ser 93A
5.45%, 5/15/13 $ 2,310 $ 2,196,810
A+ So Minnesota Muni Pwr Supply System
Ser 92A
5.75%, 1/01/18 2,870 2,759,849
AAA St Francis GO
(Ind Sch Dist #15) CGIC Ser 95A
6.375%, 2/01/16 1,175 1,235,336
-----------
17,376,958
NEBRASKA-1.4%
AAA Nebraska Inv Fin Auth Hosp Rev
(Bishop Clarkson Mem) MBIA Ser 91
9.464%, 11/15/16 (a) 3,000 3,356,130
NEW JERSEY-2.7%
AAA Cape May Cnty Swr Rev
MBIA Ser 92A
5.75%, 1/01/16 3,000 2,940,930
AAA Passaic Valley Swr Comm
AMBAC Ser 92D
5.75%, 12/01/15 3,400 3,337,168
-----------
6,278,098
NEW YORK-6.8%
AAA Glen Cove ETM IDR
(The Regency at Glen Cove) Ser 92B
Zero coupon, 10/15/19 30,000 7,005,000
AAA New York City GO
MBIA Ser 93D
6.00%, 5/15/11 5,000 5,139,750
AAA Troy HDC
MFHR (Ninth St #2) FHA Ser 90B
8.10%, 2/01/24 3,535 3,867,396
-----------
16,012,146
OHIO-2.7%
AAA Clermont Cnty Wtr Sys Rev
(Clermont Cnty Swr) AMBAC Ser 93
5.70%, 12/01/13 5,000 4,955,900
AAA Ohio Capital Corp
MFHR (Sect 8 Assist) FHA MBIA Ser 95E
6.35%, 1/01/22 1,345 1,350,340
-----------
6,306,240
PENNSYLVANIA-2.2%
AAA Pennsylvania Intergov Coop Auth
Special Tax Rev FGIC Ser 94
7.00%, 6/15/14 1,930 2,130,855
AAA Pennsylvania Trpk Comm
(Oil Franchise Tax Rev) AMBAC Ser 94A
6.00%, 12/01/19 3,000 3,009,120
-----------
5,139,975
TEXAS-1.5%
AAA Amarillo Hosp Rev
(High Plains Baptist) FSA Ser 92B
9.19%, 1/01/22 (a) 3,200 3,545,600
VIRGINIA-6.0%
AAA Chesapeake Bay Bridge & Tunnel Auth
MBIA Ser 91
5.75%, 7/01/25 1,365 1,334,670
AAA Harrisonburg Redev & Hsg Auth
MFHR (Battery Heights Assoc) GNMA
6.25%, 4/20/36 4,935 4,972,012
AAA Loudoun Cnty IDA
(Loudoun Hosp Ctr) FSA Ser 95
5.80%, 6/01/20 2,265 2,221,671
AAA Richmond Met Auth
(Expressway Rev) FGIC Ser 92B
6.25%, 7/15/22 775 787,818
AAA Virginia HFA
SFMR (Home Mtg Rev) MBIA Ser 95D
5.75%, 1/01/19 5,000 4,900,300
-----------
14,216,471
12
ALLIANCE MUNICIPAL INCOME FUND
_______________________________________________________________________________
STANDARD & PRINCIPAL
POOR'S AMOUNT
RATINGS+ (000) VALUE
- -------------------------------------------------------------------------------
WEST VIRGINIA-1.1%
AAA West Virginia Pkwys Eco Dev Rev
Ser 93
7.585%, 5/16/19 (a) $ 2,750 $ 2,621,190
------------
227,402,551
SHORT TERM MUNICIPAL NOTES-3.5%
ILLINOIS-1.5%
NR Illinois Health Fac Auth
(Elmhurst Mem Hospital) Ser 93B VRDN
4.20%, 1/01/20 (b) 3,410 3,410,000
MASSACHUSETTS-1.1%
AAA Massachusetts Hlth & Ed
MBIA Ser 85B VRDN
4.00%, 7/01/05 (b) 2,700 2,700,000
NEW YORK-0.9%
A-1+ New York City GO
Ser 94C VRDN
4.25%, 10/01/23 (b) 2,200 2,200,000
------------
8,310,000
TOTAL INVESTMENTS-99.7%
(cost $235,233,863) 235,712,551
Other assets less liabilities-0.3% 696,703
NET ASSETS-100% $236,409,254
+ Unaudited.
* Moody's or Fitch Rating.
(a) Inverse floater securitythe interest rate is subject to change
periodically.
(b) Variable Rate Demand Notes (VRDN) are instruments whose interest rates
change on a specific date (such as coupon date or interest payment date) or
whose interest rates vary with changes in a designated base rate (such as the
prime interest rate). This instrument is payable on demand and is secured by
letters of credit or other credit support agreements from major banks.
See Glossary of Terms on page 20.
See notes to financial statements.
13
NEW YORK PORTFOLIO
PORTFOLIO OF INVESTMENTS
APRIL 30, 1996 (UNAUDITED) ALLIANCE MUNICIPAL INCOME FUND
_______________________________________________________________________________
STANDARD & PRINCIPAL
POOR'S AMOUNT
RATINGS+ (000) VALUE
- -------------------------------------------------------------------------------
MUNICIPAL BONDS-98.5%
INDIANA-3.5%
AAA Indiana Dev Fin Auth (PSI Energy) PCR
MBIA Ser 93B AMT
5.75%, 2/15/28 $11,245 $10,574,348
NEW YORK-95.0%
Aaa* Cohoes IDR
(Norlite Corp Proj) Ser 92B AMT
6.75%, 5/01/09 8,500 9,213,575
A- Essex County IDA
(Int'l Paper) Ser 95A AMT
5.80%, 12/01/19 7,000 6,580,840
AAA Glen Cove IDR
(The Regency At Glen Cove) ETM Ser 92B
Zero coupon, 10/15/19 30,010 7,007,335
AAA Islip Res Rec Agy
AMBAC Ser 94B AMT
6.125%, 7/01/12 2,020 2,047,997
AAA Monroe Cnty Airport Auth
(Greater Rochester Int'l) MBIA Ser 93 AMT
5.50%, 1/01/13 4,450 4,253,310
BBB+ New York City GO
Ser 92C
7.00%, 8/01/16 2,500 2,631,500
BBB+ New York City GO
Ser 93D
6.00%, 8/01/09 9,750 9,531,405
8.106%, 8/29/14 (a) 10,000 9,557,500
BBB+ New York City GO
Ser 93E
6.00%, 5/15/11 5,000 4,822,550
BBB+ New York City GO
Ser 95B
7.25%, 8/15/19 6,500 6,931,795
BBB+ New York City GO
Ser 96J
6.00%, 2/15/24 5,000 4,692,000
BB+ New York City IDA
(American Airlines) Ser 94 AMT
6.90%, 8/01/24 12,000 12,554,280
A New York City IDA
(Terminal One LP) Ser 94 AMT
6.125%, 1/01/24 35,500 34,371,810
NR New York City IDA
(Visy Paper) Ser 95 AMT
7.80%, 1/01/16 2,000 2,027,160
AAA Niagara Frontier Trans Arpt Auth
(Gtr Buffalo Int'l) AMBAC Ser 94A AMT
6.25%, 4/01/24 11,125 11,279,971
A+ NYS Energy Res & Dev
Auth (Consolidated Edison) Ser 94A AMT
7.125%, 12/01/29 14,000 15,290,800
AAA NYS Energy Res & Dev Auth PCR
(Brooklyn Union Gas) MBIA AMT
5.60%, 6/01/25 5,000 4,572,750
AAA NYS Energy Res & Dev Auth PCR
(Brooklyn Union Gas) MBIA Ser 89B AMT
6.75%, 2/01/24 7,500 8,019,375
AAA NYS Energy Res & Dev Auth PCR
(NYS Elec & Gas) MBIA Ser 87A AMT
6.15%, 7/01/26 15,000 15,022,350
AAA NYS Energy Res & Dev Auth PCR
(NYS Elec & Gas) MBIA Ser 88A AMT
5.95%, 12/01/27 11,700 11,390,769
AAA NYS Energy Res & Dev Auth PCR
(Rochester Gas & Elec) MBIA AMT
6.50%, 5/15/32 6,460 6,696,565
BBB NYS Envir Fac Auth IDR
(Occidental Petroleum) Ser 93A AMT
5.70%, 9/01/28 15,000 13,367,250
NR NYS Envir Fac Corp Wtr Fac
(Long Island Wtr Corp) Ser 87A AMT
10.00%, 10/01/17 3,200 3,404,576
14
ALLIANCE MUNICIPAL INCOME FUND
_______________________________________________________________________________
STANDARD & PRINCIPAL
POOR'S AMOUNT
RATINGS+ (000) VALUE
- -------------------------------------------------------------------------------
AAA NYS Envir Fac Corp Wtr Fac
(Spring Valley Wtr) AMBAC Ser 94A AMT
6.30%, 8/01/24 $10,400 $10,547,576
AAA NYS Envir Fac Corp Wtr Fac
(Spring Valley Wtr) Ser 93A AMT
5.65%, 11/01/23 5,000 4,670,300
Aa* NYS HFA SONYMA
MFHR (SyracuseSpringville Proj)
Ser 93A AMT
5.85%, 8/15/13 3,000 2,935,890
5.95%, 8/15/24 5,650 5,462,025
Aa* NYS HFA SONYMA
MFHR (Westchester/Onondaga/Rockland Proj)
Ser 92F AMT
6.70%, 8/15/25 6,000 6,159,240
Aa* NYS Mtg Agy
SFMR Homeowner Mtg Ser 42 AMT
6.65%, 4/01/26 4,500 4,673,115
Aa* NYS Mtg Agy
SFMR Homeowner Mtg Ser 46 AMT
6.65%, 10/01/25 19,995 20,790,601
AAA Onondaga Cnty PCR
(Bristol-Myers Squibb) AMT
5.75%, 3/01/24 $8,000 $7,955,280
AA- Port Auth of NY & NJ
Cons (95th Ser) AMT
6.125%, 7/15/29 14,025 14,102,558
AAA Port Auth of NY & NJ
Cons (96th Ser) FGIC AMT
6.60%, 10/01/23 2,750 2,887,253
Ba* St. Lawrence Cnty Res Rec
(Solid Waste Disposal) Ser 88 AMT
8.375%, 1/01/11 2,500 2,718,650
AAA Troy HDC
MFHR (TUR Proj.) FHA Ser 90C
8.10%, 2/01/24 3,800 4,207,892
------------
292,377,843
TOTAL INVESTMENTS-98.5%
(cost $297,224,197) 302,952,191
Other assets less liabilities-1.5% 4,726,841
NET ASSETS-100% $307,679,032
+ Unaudited.
* Moody's or Fitch Rating.
(a) Inverse floater securitythe interest rate is subject to change
periodically.
See Glossary of Terms on page 20.
See notes to financial statements.
15
CALIFORNIA PORTFOLIO
PORTFOLIO OF INVESTMENTS
APRIL 30, 1996 (UNAUDITED) ALLIANCE MUNICIPAL INCOME FUND
_______________________________________________________________________________
STANDARD & PRINCIPAL
POOR'S AMOUNT
RATINGS+ (000) VALUE
- -------------------------------------------------------------------------------
CALIFORNIA MUNICIPAL BONDS-99.4%
A+ California GO
(Veterans Hsg) Ser 95 AMT
6.40%, 2/01/20 $40,000 $40,311,600
A+ California HFA
MFHR (Multi-Unit Rental Hsg) Ser 92A AMT
6.50%, 2/01/14 4,865 4,938,802
A+ California HFA
MFHR (Multi-Unit Rental) Ser 93A AMT
5.60%, 8/01/25 12,000 11,062,440
AA- California HFA
SFMR (Home Mtg Rev) Ser 91G AMT
7.05%, 8/01/27 5,570 5,727,798
AA- California HFA
SFMR (Home Mtg Rev) Ser 93D AMT
5.75%, 8/01/22 10,500 9,724,155
5.85%, 2/01/23 7,920 7,431,890
AA- California HFA
SFMR (Home Mtg Rev) Ser E AMT
6.70%, 8/01/25 9,850 10,037,446
AAA California HFA FHA/VA
SFMR (Home Mtg Rev) Ser 95A-2 AMT
6.45%, 8/01/25 13,400 13,685,420
A California Poll Ctl Fin Auth
(Browning-Ferris Ind/Keller Canyon)
Ser 92 AMT
6.875%, 11/01/27 5,000 5,170,250
A+ California Poll Ctl Fin Auth
Res Rec (Waste Mgmt Inc) Ser 91A AMT
7.15%, 2/01/11 7,000 7,546,280
A California Poll Ctl Fin Auth PCR
(Pacific Gas & Elec) Ser 93B AMT
5.85%, 12/01/23 25,000 23,258,500
A+ California Poll Ctl Fin Auth PCR
(San Diego Gas & Elec) Ser 93A-C AMT
5.85%, 6/01/21 38,335 36,683,528
A+ California Poll Ctl Fin Auth PCR
(Southern Calif Edison) Ser 92B AMT
6.40%, 12/01/24 $41,030 $41,161,296
A1* California Statewide Comm Dev Hosp
(Cedars-Sinai Med Ctr) Ser 93
5.40%, 11/01/15 (a) 28,000 25,181,800
A+ Chula Vista PCR
(San Diego Gas & Elec) Ser 92A AMT
6.40%, 12/01/27 28,240 28,759,616
AAA Contra Costa Cnty
MFHR (Byron Park Proj) GNMA Ser 93A AMT
6.40%, 1/20/31 11,860 11,978,600
NR Encinitas Comm Fac Dist #1
(Encinitas Ranch) Ser 95A
7.375%, 9/01/26 23,000 22,954,920
NR Fairfield Assess Dist
(No Cordelia Imp Dist) Ser 93
7.375%, 9/02/18 2,550 2,564,918
NR Fontana Comm Fac Dist #3
(Hunters Ridge) Ser 90A
8.70%, 10/01/15 8,000 8,179,440
NR Fontana Redev Agy
(Jurupa Hills Proj) Ser 94
8.00%, 1/01/98 5,000 5,078,700
AAA Fremont FHA
MFHR (Regency Sq Apts) Ser 86A AMT
7.75%, 11/01/28 1,500 1,577,895
AAA Garden Grove
MFHR (Tudor Grove) GNMA Collat AMT
7.25%, 5/20/32 7,300 7,521,847
AA- Long Beach Harbor Rev
Ser 93 AMT
5.125%, 5/15/13 26,150 23,728,772
5.125%, 5/15/18 36,325 31,863,563
16
ALLIANCE MUNICIPAL INCOME FUND
_______________________________________________________________________________
STANDARD & PRINCIPAL
POOR'S AMOUNT
RATINGS+ (000) VALUE
- -------------------------------------------------------------------------------
NR Los Angeles Cnty Comm Fac Dist #3
(Valencia/Newhall Area) Ser 95A
7.125%, 9/01/20 $5,500 $5,365,965
NR Los Angeles Cnty Comm Fac Dist #4
(Calabasas Area) Ser 92A
7.65%, 9/01/17 7,500 7,637,250
NR Los Angeles Cnty Comm Fac Dist #92-1
(Castaic Union SD Northlake Proj) Ser 92
9.00%, 10/01/19 8,710 8,930,537
BBB+ Los Angeles Comm Redev
MFHR (Grand Ctrl Proj) Ser 93A AMT
5.85%, 12/01/26 7,030 6,611,785
AAA Los Angeles Harbor Rev
MBIA Ser 96B AMT
6.20%, 8/01/25 10,000 10,049,900
AA Los Angeles Harbor Rev
Ser 95A AMT
6.625%, 8/01/25 25,000 26,051,000
NR Novato Comm Fac Dist #94-1
(Hamilton Field) Ser 95
7.375%, 9/01/25 6,100 6,228,161
NR Ontario Assess Dist #107
(CA Commerce Ctr So)
7.70%, 9/02/10 6,255 6,335,252
BBB- Orange Cnty
Foothill/Eastern Trans Corridor Agy
Ser 95A
Zero coupon, 1/01/15 18,500 5,350,015
AAA Orange Cnty Arpt Rev
(John Wayne Int'l) MBIA Ser 93 AMT
5.50%, 7/01/13 11,000 10,258,490
5.50%, 7/01/18 16,500 15,135,450
NR Orange Cnty Comm Fac Dist #87-2
(Portola Hills) Ser 91A
9.30%, 8/15/16 8,950 9,296,455
BBB** Orange Cnty Sr Lien
San Joaquin Hills Transportation Corridor
Ser 93
Zero coupon, 1/01/17 $16,000 $4,091,680
Zero coupon, 1/01/19 20,000 4,482,200
Zero coupon, 1/01/20 20,000 4,195,800
Zero coupon, 1/01/21 20,000 3,927,800
Zero coupon, 1/01/23 35,000 6,023,850
Zero coupon, 1/01/25 33,100 4,992,142
7.00%, 1/01/30 15,000 15,579,450
AAA Palm Springs Fin Auth Airport Rev
(Palm Springs Regional) MBIA Ser 92 AMT
6.00%, 1/01/22 6,860 6,779,669
A- Placer Cnty
(Western Placer Waste Mgmt Auth) Ser 94 AMT
6.75%, 7/01/14 7,000 7,004,200
AAA Port of Oakland
MBIA Ser 92E AMT
6.40%, 11/01/22 23,370 24,078,812
6.50%, 11/01/16 11,000 11,406,230
A Port of Oakland Spec Fac
(Mitsui O.S.K. Lines) Ser 92A AMT
6.80%, 1/01/19 3,700 3,830,499
NR Riverside Cnty Assess Dist #161
(Winchester Prop) Ser 94C
10.00%, 9/02/14 7,145 7,519,684
NR Riverside Comm Fac Dist #90-1
(Lusk-Highlander Proj) Ser 91A
8.50%, 9/01/15 2,000 2,059,840
AAA Sacramento Cnty Airport Rev Sys
FGIC Ser 92A AMT
6.00%, 7/01/20 11,750 11,615,932
NR Salinas Assess Dist #90-1
(Harden Ranch) Ser A
6.875%, 9/02/11 5,735 5,630,566
17
CALIFORNIA PORTFOLIO
PORTFOLIO OF INVESTMENTS (CONTINUED) ALLIANCE MUNICIPAL INCOME FUND
_______________________________________________________________________________
STANDARD & PRINCIPAL
POOR'S AMOUNT
RATINGS+ (000) VALUE
- -------------------------------------------------------------------------------
NR San Diego Comm Fac Dist #1
(Miramar Ranch North) Ser 95B
7.10%, 9/01/20 $ 7,000 $ 6,903,330
AAA San Francisco City & Cnty Int'l Arpt
AMBAC Ser 94 II-6 AMT Pre-refunded
6.60%, 5/01/24 5,000 5,226,850
AAA San Francisco City & Cnty Int'l Arpt
FGIC Ser 94 II-5 AMT
6.50%, 5/01/24 11,000 11,375,430
AAA San Francisco City & Cnty Int'l Arpt
MBIA Ser 10A AMT
5.70%, 5/01/26 14,385 13,615,978
AAA San Francisco City & Cnty Int'l Arpt
MBIA Ser 93 II-3 AMT
6.10%, 5/01/13 7,990 8,050,324
6.20%, 5/01/20 14,500 14,609,040
AAA San Jose Arpt Rev
FGIC Ser 93 AMT
5.625%, 3/01/13 $6,480 $6,164,878
5.70%, 3/01/18 8,825 8,360,628
AAA Southern Calif HFA
GNMA/FNMA Collat
SFMR Ser 91B-92A AMT
6.90%, 10/01/24 1,665 1,737,295
AAA 6.75%, 9/01/22 1,425 1,476,428
BBB+ Westminster Redev Agy
MFHR (Rose Garden Apt) AMT
6.75%, 8/01/24 4,300 4,302,537
A+ Yolo Cnty Hsg Auth
MFHR (Waggener Ranch Apts) FHA Ser 91 AMT
7.00%, 10/01/33 9,000 9,493,740
TOTAL INVESTMENTS-99.4%
(cost $712,541,554) 717,914,548
Other assets less liabilities-0.6% 4,211,225
NET ASSETS-100% $722,125,773
+ Unaudited.
* Moody's or Fitch Rating.
(a) Linked security.
See Glossary of Terms on page 20.
See notes to financial statements.
18
INSURED CALIFORNIA PORTFOLIO
PORTFOLIO OF INVESTMENTS
APRIL 30, 1996 (UNAUDITED) ALLIANCE MUNICIPAL INCOME FUND
_______________________________________________________________________________
STANDARD & PRINCIPAL
POOR'S AMOUNT
RATINGS+ (000) VALUE
- -------------------------------------------------------------------------------
CALIFORNIA MUNICIPAL BONDS-104.4%
LONG TERM MUNICIPAL BONDS-103.5%
AAA Alhambra COP
Assess Dist #91-1: Police Fac AMBAC Ser 92
6.75%, 9/01/23 $ 5,000 $ 5,326,150
AAA Brea Pub Fin Auth
Tax Alloc Redev Proj B MBIA Ser 91A
7.00%, 8/01/15 1,470 1,602,476
AAA California HFA
MFHR (Home Mtg Rev) AMBAC Ser 95A
6.25%, 2/01/37 5,000 5,049,100
A1 California Statewide Comm Dev Hosp
(Cedars-Sinai Med Ctr) Ser 93
5.40%, 11/01/15 (a) 7,000 6,295,450
AAA Coronado Comm Dev Proj
Tax Alloc FSA Ser 96
6.00%, 9/01/26 8,700 8,714,094
AAA Coronado Comm Dev Proj
Tax Alloc MBIA Ser 90
7.25%, 9/01/12 2,000 2,215,660
AAA Fairfield City Pub Fin Auth
Tax Alloc (Fairfield Proj) CGIC Ser 93C
5.50%, 8/01/23 5,700 5,290,512
AAA Fontana Pub Fin Auth
Tax Alloc (No Fontana) MBIA Ser 93A
5.625%, 9/01/24 4,805 4,566,768
AAA Glendale Hlth Fac Rev
(Glendale Mem Hosp) CONNIE LEE Ser 95A
5.60%, 11/15/25 2,000 1,833,240
AAA La Mirada Redev Agy
Tax Alloc (Commercial Redev) CGIC Ser 95B
5.90%, 8/15/24 5,000 4,872,050
AAA Los Angeles Cnty
Trans Comm FGIC Ser 91B
6.50%, 7/01/15 5,000 5,190,350
AAA Los Angeles Cnty Comm Redev
Tax Alloc (Bunker Hill Proj) FSA Ser 93H
5.60%, 12/01/28 7,500 7,031,850
AAA Madera Cnty COP
Hosp Rev (Valley Children's Hosp)
MBIA Ser 95
6.125%, 3/15/23 4,000 4,026,440
AAA Mojave Water Agy
(Morongo Basin Pipeline) FGIC Ser 96
5.80%, 9/01/22 10,000 9,761,800
AAA Mt Diablo School Dist
Comm Fac FGIC Ser 90
7.05%, 8/01/20 5,000 5,420,150
AAA Northern Calif Trans Agy Elec Rev
(Calif-Oregon Trans) MBIA Ser 93A
6.77%, 4/29/24 (b) 14,250 12,270,390
AAA Orange Cnty COP
(Loma Ridge Data Ctr Proj) AMBAC
6.00%, 6/01/21 1,000 988,440
AAA Orange Cnty Saddleback Valley Sch Dist
FSA Ser 95A
5.65%, 9/01/17 5,000 4,767,400
AAA Palm Springs ETM COP
Ser 91B
Zero coupon, 4/15/21 70,925 14,204,859
AAA Rancho Wtr Dist Fin Auth
AMBAC Ser 91 Pre-refunded
9.034%, 9/11/01 3,000 3,590,040
AAA Sacramento Muni Util Dist Elec Rev
MBIA Ser 93E
5.75%, 5/15/22 5,000 4,810,750
AAA San Bernardino Cnty
Joint Pwr Fin Auth CGIC Ser 95A
5.75%, 10/01/25 5,000 4,801,300
19
INSURED CALIFORNIA PORTFOLIO
PORTFOLIO OF INVESTMENTS (CONTINUED) ALLIANCE MUNICIPAL INCOME FUND
_______________________________________________________________________________
STANDARD & PRINCIPAL
POOR'S AMOUNT
RATINGS+ (000) VALUE
- -------------------------------------------------------------------------------
AAA San Dimas Redev Agy
(Creative Growth) CGIC Ser 91A
6.75%, 9/01/16 $ 1,000 $ 1,062,850
AAA San Francisco City & Cnty Int'l Arpt
MBIA Ser 10B
5.50%, 5/01/26 5,000 4,660,600
AAA San Francisco City & Cnty Int'l Arpt
MBIA Ser 93 II-4
6.00%, 5/01/14 5,000 5,037,950
AAA Shasta Lake COP
FSA Ser 96-2
6.00%, 4/01/16 2,895 2,864,979
AAA So Tahoe Jnt Pwr Fin Auth
Ser 95A CAP MAC
5.75%, 10/01/25 4,500 4,262,130
NR Tracy Pub Fac Fin Agy
Comm Fac Dist #87-1 Ser 89B Pre-refunded
7.50%, 10/01/97 5,000 5,390,200
NR Tracy Pub Fac Fin Agy
Comm Fac Dist #87-1 Ser 92E Pre-refunded
7.50%, 10/01/99 3,500 3,894,415
------------
149,802,393
SHORT TERM MUNICIPAL NOTES-0.9%
A-2 Orange Cnty (Irvine Coast Assess) Dist 88-1
Ser 88 VRDN
4.00%, 9/01/18 (c) 1,300 1,300,000
TOTAL INVESTMENTS-104.4%
(cost $152,178,133) 151,102,393
Other assets less liabilities-(4.4%) (6,413,310)
NET ASSETS-100% $144,689,083
+ Unaudited.
* Moody's or Fitch Rating.
(a) Linked security.
(b) Inverse floater securitythe interest rate is subject to change
periodically.
(c) Variable Rate Demand Notes (VRDN) are instruments whose interest rates
change on a specific date (such as coupon date or interest payment date) or
whose interest rates vary with changes in a designated base rate (such as the
prime interest rate). This instrument is payable on demand and is secured by
letters of credit or other credit support agreements from major banks.
See Glossary of Terms below.
See notes to financial statements.
Glossary of Terms:
AMBAC American Municipal Bond Assurance Corporation
AMT Alternative Minimum Tax
CAP MAC Capital Markets Assurance Corporation
CGIC Capital Guaranty Insurance Corporation
CONNIE LEE Connie Lee Insurance Company
COP Certificate of Participation
ETM Escrow to Maturity
FGIC Financial Guaranty Insurance Company
FHA Federal Housing Administration
FNMA Federal National Mortgage Association
FSA Financial Security Assurance, Inc.
GNMA Government National Mortgage Association
GO General Obligation
HDA Housing Development Authority
HDC Housing Development Corporation
HFA Housing Finance Authority
IDA Industrial Development Authority
IDR Industrial Development Revenue
LOC Letter of Credit
MBIA Municipal Bond Investors Assurance
MFHR Multi-Family Housing Revenue
NR Not Rated
PCR Pollution Control Revenue
SFMR Single Family Mortgage Revenue
SONYMA State of New York Mortgage Agency
VA Veteran's Administration
VRDN Variable Rate Demand Note
20
STATEMENTS OF ASSETS AND LIABILITIES
APRIL 30, 1996 (UNAUDITED) ALLIANCE MUNICIPAL INCOME FUND
_______________________________________________________________________________
<TABLE>
<CAPTION>
INSURED INSURED
NATIONAL NATIONAL NEW YORK CALIFORNIA CALIFORNIA
------------- ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C>
ASSETS
Investments in securities, at value (cost:
National-$662,094,321; Ins. National-
$235,233,863; New York-$297,224,197;
California-$712,541,554; Ins. California-
$152,178,133, respectively) $661,912,773 $235,712,551 $302,952,191 $717,914,548 $151,102,393
Cash -0- -0- -0- 2,150,233 -0-
Interest receivable 12,982,082 3,941,392 5,033,576 13,533,366 1,903,718
Receivable for capital stock sold 483,977 48,485 1,228,682 993,302 1,106,235
Prepaid expenses and other assets 69,472 49,377 13,456 30,502 6,064
Receivable for investment securities sold -0- 716,137 -0- -0- -0-
Total assets 675,448,304 240,467,942 309,227,905 734,621,951 154,118,410
LIABILITIES
Due to custodian 3,120,320 996,810 794,599 -0- 237,534
Payable for investment securities purchased 12,885,992 2,385,371 -0- 9,987,111 8,700,000
Distribution fee payable 355,398 103,200 149,555 323,279 60,137
Payable for capital stock redeemed 250,225 79,122 26,949 669,719 29,106
Advisory fee payable 108,115 96,764 37,669 220,980 64,521
Accrued expenses and other liabilities 1,222,384 397,421 540,101 1,295,089 338,029
Total liabilities 17,942,434 4,058,688 1,548,873 12,496,178 9,429,327
NET ASSETS $657,505,870 $236,409,254 $307,679,032 $722,125,773 $144,689,083
CLASS A SHARES
Net assets $321,678,865 $158,571,363 $177,839,290 $466,670,721 $101,157,852
Shares of capital stock outstanding 31,452,749 15,959,118 18,837,841 45,327,363 7,835,901
CLASS B SHARES
Net assets $234,781,578 $ 55,121,344 $ 96,754,959 $164,451,748 $ 29,378,678
Shares of capital stock outstanding 22,962,288 5,550,172 10,247,674 15,971,488 2,274,673
CLASS C SHARES
Net assets $101,045,427 $ 22,716,547 $ 33,084,783 $ 91,003,304 $ 14,152,553
Shares of capital stock outstanding 9,883,774 2,287,635 3,504,122 8,838,028 1,096,098
COMPOSITION OF NET ASSETS
Capital stock, at par $ 64,299 $ 23,797 $ 32,590 $ 70,137 $ 11,207
Additional paid-in capital 676,723,235 233,283,439 310,691,581 726,480,315 147,116,588
Undistributed (overdistributed) net
investment income (13,463) (188,015) (36,056) 54 (25,506)
Accumulated net realized gain (loss) (19,076,148) 2,811,345 (8,737,077) (9,797,727) (1,337,466)
Net unrealized appreciation (depreciation)
of investments (192,053) 478,688 5,727,994 5,372,994 (1,075,740)
------------- ------------- ------------- ------------- -------------
$657,505,870 $236,409,254 $307,679,032 $722,125,773 $144,689,083
CALCULATION OF MAXIMUM OFFERING PRICE
CLASS A SHARES
Net asset value and redemption price per share $10.23 $ 9.94 $ 9.44 $10.30 $12.91
Sales charge-4.25% of public offering price .45 .44 .42 .46 .57
Maximum offering price $10.68 $10.38 $ 9.86 $10.76 $13.48
CLASS B SHARES
Net asset value and offering price per share $10.22 $ 9.93 $ 9.44 $10.30 $12.92
CLASS C SHARES
Net asset value, redemption and offering price
per share $10.22 $ 9.93 $ 9.44 $10.30 $12.91
</TABLE>
See notes to financial statements.
21
STATEMENTS OF OPERATIONS
SIX MONTHS ENDED APRIL 30, 1996 (UNAUDITED) ALLIANCE MUNICIPAL INCOME FUND
_______________________________________________________________________________
<TABLE>
<CAPTION>
INSURED INSURED
NATIONAL NATIONAL NEW YORK CALIFORNIA CALIFORNIA
------------- ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C>
INVESTMENT INCOME
Interest $ 21,326,887 $ 7,272,679 $ 9,772,172 $ 23,011,382 $ 4,484,482
EXPENSES
Advisory fee 2,151,012 735,386 978,634 2,292,918 408,345
Distribution fee-Class A 504,670 245,599 273,454 714,789 156,002
Distribution fee-Class B 1,230,855 291,392 480,656 836,560 149,918
Distribution fee-Class C 528,532 112,082 173,645 449,478 72,519
Transfer agency 334,435 84,637 145,652 236,931 38,952
Custodian 77,014 46,257 45,443 75,903 37,953
Administrative 44,760 49,490 48,714 45,049 48,352
Audit and legal 41,900 21,260 13,043 18,376 11,869
Registration 40,949 26,432 3,120 2,785 2,486
Printing 19,971 8,983 8,894 18,393 5,240
Taxes 16,817 6,410 7,829 17,633 3,845
Directors' fees 2,185 2,185 2,185 2,185 2,185
Miscellaneous 30,463 6,119 5,006 9,211 2,383
Total expenses 5,023,563 1,636,232 2,186,275 4,720,211 940,049
Less advisory fee waived (see note B) (1,462,688) (124,317) (733,400) (1,086,975) -0-
Net expenses 3,560,875 1,511,915 1,452,875 3,633,236 940,049
Net investment income 17,766,012 5,760,764 8,319,297 19,378,146 3,544,433
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS
Net realized gain on investments 16,450,816 8,316,577 3,374,644 5,772,583 2,571,459
Net change in unrealized appreciation
of investments (30,941,409) (11,194,683) (9,153,793) (16,445,838) (7,084,408)
Net loss on investments (14,490,593) (2,878,106) (5,779,149) (10,673,255) (4,512,949)
NET INCREASE(DECREASE) IN NET ASSETS
FROM OPERATIONS $ 3,275,419 $ 2,882,658 $ 2,540,148 $ 8,704,891 $ (968,516)
</TABLE>
See notes to financial statements.
22
STATEMENTS OF CHANGES IN NET ASSETS ALLIANCE MUNICIPAL INCOME FUND
_______________________________________________________________________________
<TABLE>
<CAPTION>
NATIONAL INSURED NATIONAL
------------------------------ ------------------------------
SIX MONTHS ENDED SIX MONTHS ENDED
APRIL 30,1996 YEAR ENDED APRIL 30,1996 YEAR ENDED
(UNAUDITED) OCT. 31,1995 (UNAUDITED) OCT. 31,1995
-------------- ------------- -------------- -------------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET
ASSETS FROM OPERATIONS
Net investment income $ 17,766,012 $ 38,182,112 $ 5,760,764 $ 12,312,442
Net realized gain (loss) on
investments 16,450,816 (16,742,673) 8,316,577 (1,551,031)
Net change in unrealized
appreciation of investments (30,941,409) 88,985,630 (11,194,683) 29,609,236
Net increase in net assets
from operations 3,275,419 110,425,069 2,882,658 40,370,647
DIVIDENDS AND DISTRIBUTIONS TO
SHAREHOLDERS FROM:
Net investment income
Class A (9,253,537) (19,557,074) (4,157,977) (8,620,766)
Class B (5,959,022) (12,892,784) (1,292,225) (2,612,853)
Class C (2,566,916) (5,936,007) (498,577) (1,078,823)
Distributions in excess of net
investment income
Class A -0- -0- -0- (239,073)
Class B -0- -0- -0- (72,460)
Class C -0- -0- -0- (29,919)
CAPITAL STOCK TRANSACTIONS
Net decrease (26,726,151) (95,757,376) (7,328,260) (10,119,842)
Total increase (decrease) (41,230,207) (23,718,172) (10,394,381) 17,596,911
NET ASSETS
Beginning of year 698,736,077 722,454,249 246,803,635 229,206,724
End of period $657,505,870 $698,736,077 $236,409,254 $246,803,635
</TABLE>
See notes to financial statements.
23
STATEMENTS OF CHANGES IN NET ASSETS (CONT.) ALLIANCE MUNICIPAL INCOME FUND
_______________________________________________________________________________
NEW YORK
-------------------------------
SIX MONTHS ENDED
APRIL 30,1996 YEAR ENDED
(UNAUDITED) OCT. 31,1995
--------------- -------------
INCREASE (DECREASE) IN NET ASSETS
FROM OPERATIONS
Net investment income $ 8,319,297 $ 16,972,904
Net realized gain (loss) on investments 3,374,644 (8,599,808)
Net change in unrealized appreciation of
investments (9,153,793) 37,571,643
Net increase in net assets from operations 2,540,148 45,944,739
DIVIDENDS TO SHAREHOLDERS FROM:
Net investment income
Class A (5,146,194) (10,790,213)
Class B (2,359,183) (4,577,754)
Class C (849,976) (1,680,454)
CAPITAL STOCK TRANSACTIONS
Net increase (decrease) 2,848,198 (17,006,966)
Total increase (decrease) (2,967,007) 11,889,352
NET ASSETS
Beginning of year 310,646,039 298,756,687
End of period $307,679,032 $310,646,039
See notes to financial statements.
24
ALLIANCE MUNICIPAL INCOME FUND
_______________________________________________________________________________
<TABLE>
<CAPTION>
CALIFORNIA INSURED CALIFORNIA
------------------------------ ------------------------------
SIX MONTHS ENDED SIX MONTHS ENDED
APRIL 30,1996 YEAR ENDED APRIL 30,1996 YEAR ENDED
(UNAUDITED) OCT. 31,1995 (UNAUDITED) OCT. 31,1995
-------------- ------------- -------------- -------------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET
ASSETS FROM OPERATIONS
Net investment income $ 19,378,146 $ 40,567,570 $ 3,544,433 $ 7,096,605
Net realized gain (loss) on
investments 5,772,583 (10,675,369) 2,571,459 47,999
Net change in unrealized
appreciation of investments (16,445,838) 83,053,467 (7,084,408) 16,442,245
Net increase (decrease) in net
assets from operations 8,704,891 112,945,668 (968,516) 23,586,849
DIVIDENDS AND DISTRIBUTIONS TO
SHAREHOLDERS FROM:
Net investment income
Class A (13,194,016) (27,565,247) (2,617,525) (5,371,233)
Class B (4,022,425) (8,365,628) (641,691) (1,159,355)
Class C (2,161,651) (4,642,175) (310,723) (566,017)
Distributions in excess of net
investment income
Class A -0- -0- -0- (102,666)
Class B -0- -0- -0- (22,160)
Class C -0- -0- -0- (10,819)
CAPITAL STOCK TRANSACTIONS
Net increase (decrease) (287,961) (74,094,906) 3,148,306 (2,195,497)
Total increase (decrease) (10,961,162) (1,722,288) (1,390,149) 14,159,102
NET ASSETS
Beginning of year 733,086,935 734,809,223 146,079,232 131,920,130
End of period $722,125,773 $733,086,935 $144,689,083 $146,079,232
</TABLE>
See notes to financial statements.
25
NOTES TO FINANCIAL STATEMENTS
APRIL 30, 1996 (UNAUDITED) ALLIANCE MUNICIPAL INCOME FUND
_______________________________________________________________________________
NOTE A: SIGNIFICANT ACCOUNTING POLICIES
Alliance Municipal Income Fund, Inc. (the 'Fund') is registered under the
Investment Company Act of 1940 as a diversified open-end management investment
company. The Fund, which is a Maryland corporation, operates as a series
company currently comprised of five portfolios: National Portfolio, Insured
National Portfolio, New York Portfolio, California Portfolio and Insured
California Portfolio (the 'Portfolios'). Each series is considered to be a
separate entity for financial reporting and tax purposes. Each portfolio offers
three classes of shares: Class A, Class B and Class C Shares. Class A shares
are sold with a front-end sales charge of up to 4.25%. Class B shares are sold
with a contingent deferred sales charge which declines from 3% to zero
depending on the period of time the shares are held. Class B shares will
automatically convert to Class A shares six years after the end of the calendar
month of purchase. Class C shares are sold without an initial or contingent
deferred sales charge. All three classes of shares have identical voting,
dividend liquidation and other rights and the same terms and conditions, except
that each class bears different distribution expenses and has exclusive voting
rights with respect to its distribution plan. The following is a summary of the
significant accounting policies followed by the Fund.
1. SECURITY VALUATION
The Fund values municipal securities at fair value based on prices provided by
a recognized pricing service which uses information with respect to
transactions in bonds, quotations from bond dealers, market transactions in
comparable securities and various relationships between securities. Securities
for which market quotations are not readily available and restricted securities
which are subject to limitations as to their resale are valued in good faith at
fair value by the Fund's Adviser under procedures established by the Fund's
Board of Directors. Short-term securities which mature in 60 days or less are
valued at amortized cost, which approximates market value.
2. TAXES
It is the intention of each Portfolio to meet the requirements of the Internal
Revenue Code applicable to regulated investment companies and to distribute all
of its investment company taxable income and net realized gains, if applicable,
to its shareholders. Therefore, no provisions for federal income or excise
taxes are required.
3. INVESTMENT INCOME AND SECURITY TRANSACTIONS
Interest income is accrued daily. Security transactions are accounted for on
the date the securities are purchased or sold. Security gains and losses are
determined on the identified cost basis. The Fund amortizes premiums and
accrues original issue discounts and market discounts as adjustments to
interest income.
The New York, Insured California and California Portfolios follow an investment
policy of investing primarily in municipal obligations of one state. Economic
changes affecting the state and certain of its public bodies and municipalities
may affect the ability of issuers within the state to pay interest on, or repay
principal of, municipal obligations held by the Portfolios.
4. DIVIDENDS AND DISTRIBUTIONS
Dividends and distributions to shareholders are recorded on the ex-dividend
date and are determined in accordance with income tax regulations.
NOTE B: ADVISORY FEE AND OTHER TRANSACTIONS WITH AFFILIATES
Under the terms of an investment advisory agreement, the National, New York and
California Portfolios pay Alliance Capital Management L.P., (the 'Adviser') an
advisory fee at an annual rate of up to .625 of 1% of each Portfolio's average
daily net assets. For the Insured National Portfolio, the Agreement provides
for a fee at an annual rate of up to .625 of 1% of the first $200 million, .50
of 1% of the next $200 million and .45 of 1% in excess of $400 million of the
Portfolio's average daily net assets. For the Insured California Portfolio, the
Agreement provides for a fee at an annual rate of up to .55 of 1% of the first
$200 million, .50 of 1% of the next $200 million and .45 of 1% in excess of
$400 million of the Portfolio's average daily net assets.
Such fees are accrued daily and paid monthly. The Adviser has agreed, under the
terms of the investment advisory agreement, to reimburse the Fund to the extent
26
ALLIANCE MUNICIPAL INCOME FUND
_______________________________________________________________________________
that the expenses of each of its Portfolios (exclusive of interest, taxes,
brokerage, distribution fees, and extraordinary expenses) exceed the limits
prescribed by any state in which that Portfolio's shares are qualified for
sale. The most restrictive expense limitation is believed to be 2.5% of the
first $30 million, 2% of the next $70 million, and 1.5% of the excess over $100
million of each Portfolio's average daily net assets. No such reimbursement was
required for the six months ended April 30, 1996. For the six months ended
April 30, 1996 the Adviser voluntarily agreed to waive part of its advisory fee
for the National, Insured National, New York and California Portfolios.
The aggregate amounts of such fee waivers were: National Portfolio, $1,462,688;
Insured National Portfolio, $124,317; New York Portfolio, $733,400 and
California Portfolio, $1,086,975. Pursuant to the Advisory Agreement, the Fund
paid $236,365 to the Adviser representing the cost of certain legal and
accounting services provided to each Portfolio by the Adviser.
Each Portfolio compensates Alliance Fund Services, Inc. (a wholly-owned
subsidiary of the Adviser) under a Services Agreement for providing personnel
and facilities to perform transfer agency services for each Portfolio. Such
compensation amounted to $197,650 for the National Portfolio, $52,360 for the
Insured National Portfolio, $87,470 for the New York Portfolio, $143,400 for
the California Portfolio and $22,330 for the Insured California Portfolio.
Alliance Fund Distributors, Inc. (a wholly-owned subsidiary of the Adviser)
serves as the Distributor of the Fund's capital stock. The amount of front-end
sales charges received by the Distributor from sales of the respective
Portfolio's Class A shares for the six months ended April 30, 1996 were:
National Portfolio, $26,076; Insured National Portfolio, $8,936; New York
Portfolio, $13,586; California Portfolio, $48,748; and Insured California
Portfolio, $7,147. The amount of contingent deferred sales charge imposed upon
redemptions by shareholders of Class B shares were: National Portfolio,
$175,317; Insured National Portfolio, $64,649; New York Portfolio, $67,845;
California Portfolio, $154,402; and Insured California Portfolio, $18,962.
NOTE C: DISTRIBUTION SERVICES AGREEMENT
Each Portfolio has adopted a Distribution Services Agreement (the 'Agreement')
pursuant to Rule 12b-1 under the Investment Company Act of 1940 for Class A,
Class B and Class C shares. Under the Agreement, each Portfolio pays a
distribution fee to the Distributor at an annual rate of up to .30 of 1% of
each Portfolio's average daily net assets attributable to the Class A shares
and 1% of each Portfolio's average daily net assets attributable to the Class B
and Class C shares. The Agreement provides that the Distributor will use such
payments in their entirety for distribution assistance and promotional
activities. The Distributor has incurred expenses in excess of the distribution
costs reimbursed by each Portfolio as follows:
PORTFOLIO CLASS B CLASS C
- ------------------ ---------- ----------
National $4,120,237 $1,956,084
Insured National 1,841,324 655,076
New York 2,897,565 755,618
California 4,542,535 1,587,626
Insured California 1,294,597 436,164
Such costs may be recovered from each Portfolio in future periods so long as
the Agreement is in effect. In accordance with the Agreement, there is no
provision for recovery of unreimbursed distribution costs incurred by the
Distributor beyond the current fiscal year for Class A shares. The Agreement
also provides that the Adviser may use its own resources to finance the
distribution of each Portfolio's shares.
27
NOTES TO FINANCIAL STATEMENTS (CONTINUED) ALLIANCE MUNICIPAL INCOME FUND
_______________________________________________________________________________
NOTE D: INVESTMENT TRANSACTIONS
Purchases and sales of investment securities (excluding short-term securities)
for the six months ended April 30, 1996 were:
PORTFOLIO PURCHASES SALES
- ------------------ ------------ ------------
National $491,573,869 $508,712,549
Insured National 226,065,427 239,795,664
New York 81,616,796 80,654,371
California 193,046,411 193,933,823
Insured California 101,026,334 93,882,759
At April 30, 1996, the cost of securities for federal income tax purposes,
gross unrealized appreciation, gross unrealized depreciation and net unrealized
appreciation/depreciation of investments for each Portfolio were as follows:
NET
GROSS UNREALIZED UNREALIZED
---------------------------- APPRECIATION/
TAX COST APPRECIATION (DEPRECIATION) DEPRECIATION
------------ ------------ -------------- -------------
National $662,267,811 $ 9,011,425 $ (9,366,463) $ (355,038)
Insured National 235,266,820 3,238,099 (2,792,368) 445,731
New York 297,239,936 8,265,143 (2,552,888) 5,712,255
California 712,541,554 16,774,991 (11,401,997) 5,372,994
Insured California 153,039,439 2,662,547 (4,599,593) (1,937,046)
NOTE E: TAXES
For Federal income tax purposes at October 31, 1995, the Fund had capital loss
carryforwards for the following Portfolios: $17,246,158 expiring in 2002 and
$18,232,038 expiring in 2003 for the National Portfolio; $3,946,364 expiring in
2002 and $1,465,884 expiring in 2003 for the Insured National Portfolio;
$1,550,512 expiring in 2002 and $10,545,470 expiring in 2003 for the New York
Portfolio; $4,748,470 expiring in 2002 and $10,797,828 expiring in 2003 for the
California Portfolio; and $3,908,925 expiring in 2002 for the Insured
California Portfolio.
NOTE F: CAPITAL STOCK
There are 3,000,000,000 shares of $.001 par value capital stock authorized,
designated Class A, Class B and Class C shares. There are 200,000,000
authorized shares for each Class.
NATIONAL PORTFOLIO
------------------------------------------------------------
SHARES AMOUNT
---------------------------- ------------------------------
SIX MONTHS ENDED YEAR ENDED SIX MONTHS ENDED YEAR ENDED
APRIL 30,1996 OCTOBER 31, APRIL 30,1996 OCTOBER 31,
(UNAUDITED) 1995 (UNAUDITED) 1995
------------- ----------- --------------- -------------
CLASS A
Shares sold 3,689,741 4,787,898 $39,171,160 $ 47,317,764
Shares issued in
reinvestment of
dividends and
distributions 514,019 1,139,057 5,386,350 11,273,668
Shares converted from
Class B to Class A 541,437 -0- 5,660,611 -0-
Shares redeemed (5,664,334) (9,571,534) (59,744,376) (93,714,112)
Net decrease (919,137) (3,644,579) $(9,526,255) $(35,122,680)
28
ALLIANCE MUNICIPAL INCOME FUND
_______________________________________________________________________________
NATIONAL PORTFOLIO
------------------------------------------------------------
SHARES AMOUNT
---------------------------- ------------------------------
SIX MONTHS ENDED YEAR ENDED SIX MONTHS ENDED YEAR ENDED
APRIL 30,1996 OCTOBER 31, APRIL 30,1996 OCTOBER 31,
(UNAUDITED) 1995 (UNAUDITED) 1995
------------- ----------- --------------- -------------
CLASS B
Shares sold 1,209,047 3,237,841 $ 12,694,079 $ 31,671,965
Shares issued in
reinvestment of
dividends and
distributions 359,862 840,798 3,770,483 8,326,644
Shares converted from
Class B to Class A (541,437) -0- (5,660,611) -0-
Shares redeemed (2,213,864) (6,546,335) (23,302,098) (63,976,163)
Net decrease (1,186,392) (2,467,696) $(12,498,147) $(23,977,554)
CLASS C
Shares sold 1,456,970 2,513,404 $ 15,396,792 $ 24,850,658
Shares issued in
reinvestment of
dividends and
distributions 171,083 506,602 1,792,160 5,001,846
Shares redeemed (2,086,024) (6,842,684) (21,890,702) (66,509,646)
Net decrease (457,971) (3,822,678) $ (4,701,750) $(36,657,142)
INSURED NATIONAL PORTFOLIO
------------------------------------------------------------
SHARES AMOUNT
---------------------------- ------------------------------
SIX MONTHS ENDED YEAR ENDED SIX MONTHS ENDED YEAR ENDED
APRIL 30, 1996 OCTOBER 31, APRIL 30, 1996 OCTOBER 31,
(UNAUDITED) 1995 (UNAUDITED) 1995
------------- ----------- --------------- -------------
CLASS A
Shares sold 590,145 2,109,319 $ 5,995,752 $19,729,676
Shares issued in
reinvestment of
dividends and
distributions 208,636 463,475 2,121,096 4,426,013
Shares converted from
Class B to Class A 2,134 -0- 21,316 -0-
Shares redeemed (1,281,832) (3,272,946) (13,073,010) (30,921,711)
Net decrease (480,917) (700,152) $(4,934,846) $(6,766,022)
CLASS B
Shares sold 389,036 1,180,257 $ 3,985,634 $11,132,100
Shares issued in
reinvestment of
dividends and
distributions 78,327 173,416 796,263 1,661,573
Shares converted from
Class B to Class A (2,134) -0- (21,316) -0-
Shares redeemed (774,708) (1,232,039) (7,930,061) (11,659,140)
Net increas (decrease) (309,479) 121,634 $(3,169,480) $ 1,134,533
CLASS C
Shares sold 449,192 488,859 $ 4,531,673 $ 4,578,511
Shares issued in
reinvestment of
dividends and
distributions 33,889 107,163 344,469 1,023,246
Shares redeemed (407,164) (1,074,063) (4,100,076) (10,090,110)
Net increase(decrease) 75,917 (478,041) $ 776,066 $(4,488,353)
29
NOTES TO FINANCIAL STATEMENTS (CONTINUED) ALLIANCE MUNICIPAL INCOME FUND
_______________________________________________________________________________
NEW YORK PORTFOLIO
------------------------------------------------------------
SHARES AMOUNT
---------------------------- ------------------------------
SIX MONTHS ENDED YEAR ENDED SIX MONTHS ENDED YEAR ENDED
APRIL 30,1996 OCTOBER 31, APRIL 30,1996 OCTOBER 31,
(UNAUDITED) 1995 (UNAUDITED) 1995
------------- ----------- --------------- -------------
CLASS A
Shares sold 921,018 1,541,732 $ 8,936,773 $ 14,097,320
Shares issued in
reinvestment of
dividends and
distributions 336,014 730,643 3,245,959 6,699,094
Shares converted from
Class B to Class A 6,922 -0- 67,122 -0-
Shares redeemed (1,556,246) (4,026,816) (15,094,860) (36,382,127)
Net decrease (292,292) (1,754,441) $(2,845,006) $(15,585,713)
CLASS B
Shares sold 1,039,206 1,765,580 $10,051,060 $16,166,559
Shares issued in
reinvestment of
dividends and
distributions 159,939 330,093 1,544,244 3,029,271
Shares converted from
Class B to Class A (6,922) -0- (67,122) -0-
Shares redeemed (755,650) (1,678,380) (7,320,330) (15,223,910)
Net increase 436,573 417,293 $ 4,207,852 $ 3,971,920
CLASS C
Shares sold 884,294 774,912 $ 8,624,956 $ 7,137,932
Shares issued in
reinvestment of
dividends and
distributions 64,114 145,723 619,212 1,332,925
Shares redeemed (796,956) (1,539,788) (7,758,816) (13,864,030)
Net increase(decrease) 151,452 (619,153) $ 1,485,352 $ (5,393,173)
CALIFORNIA PORTFOLIO
------------------------------------------------------------
SHARES AMOUNT
---------------------------- ------------------------------
SIX MONTHS ENDED YEAR ENDED SIX MONTHS ENDED YEAR ENDED
APRIL 30,1996 OCTOBER 31, APRIL 30,1996 OCTOBER 31,
(UNAUDITED) 1995 (UNAUDITED) 1995
------------- ----------- --------------- -------------
CLASS A
Shares sold 2,350,582 4,608,607 $24,810,511 $ 45,697,476
Shares issued in
reinvestment of
dividends and
distributions 586,110 1,354,247 6,177,615 12,936,654
Shares converted from
Class B to Class A 18,014 -0- 187,011 -0-
Shares redeemed (3,435,042) (10,053,974) (36,341,028) (97,704,751)
Net decrease (480,336) (4,091,120) $(5,165,891) $(39,070,621)
30
ALLIANCE MUNICIPAL INCOME FUND
_______________________________________________________________________________
CALIFORNIA PORTFOLIO
------------------------------------------------------------
SHARES AMOUNT
---------------------------- ------------------------------
SIX MONTHS ENDED YEAR ENDED SIX MONTHS ENDED YEAR ENDED
APRIL 30,1996 OCTOBER 31, APRIL 30,1996 OCTOBER 31,
(UNAUDITED) 1995 (UNAUDITED) 1995
------------- ----------- --------------- -------------
CLASS B
Shares sold 1,355,141 2,379,727 $14,324,227 $ 23,517,537
Shares issued in
reinvestment of
dividends and
distributions 204,186 477,127 2,151,599 4,724,963
Shares converted from
Class B to Class A (18,014) -0- (187,011) -0-
Shares redeemed (1,521,653) (3,973,996) (16,083,709) (38,724,734)
Net increase(decrease) 19,660 (1,117,142) $205,106 $(10,482,234)
CLASS C
Shares sold 1,408,861 1,828,084 $14,905,089 $ 18,294,426
Shares issued in
reinvestment of
dividends and
distributions 123,438 335,322 1,299,619 3,304,549
Shares redeemed (1,093,345) (4,758,478) (11,531,884) (46,141,026)
Net increase(decrease) 438,954 (2,595,072) $ 4,672,824 $(24,542,051)
INSURED CALIFORNIA PORTFOLIO
------------------------------------------------------------
SHARES AMOUNT
---------------------------- ------------------------------
SIX MONTHS ENDED YEAR ENDED SIX MONTHS ENDED YEAR ENDED
APRIL 30,1996 OCTOBER 31, APRIL 30,1996 OCTOBER 31,
(UNAUDITED) 1995 (UNAUDITED) 1995
------------- ----------- --------------- -------------
CLASS A
Shares sold 481,549 1,612,641 $6,404,414 $19,702,408
Shares issued in
reinvestment of
dividends and
distributions 95,138 201,630 1,274,634 2,542,607
Shares redeemed (546,774) (2,051,864) (7,327,488) (25,275,836)
Net increase(decrease) 29,913 (237,593) $ 351,560 $(3,030,821)
CLASS B
Shares sold 409,002 812,573 $5,517,018 $10,053,570
Shares issued in
reinvestment of
dividends and
distributions 25,380 50,558 340,029 638,689
Shares redeemed (248,633) (859,461) (3,327,402) (10,363,603)
Net increase 185,749 3,670 $2,529,645 $ 328,656
CLASS C
Shares sold 153,954 474,208 $2,086,203 $ 5,898,558
Shares issued in
reinvestment of
dividends and
distributions 16,505 29,986 220,981 379,781
Shares redeemed (149,987) (486,148) (2,040,083) (5,771,671)
Net increase 20,472 18,046 $ 267,101 $ 506,668
31
FINANCIAL HIGHLIGHTS ALLIANCE MUNICIPAL INCOME FUND
_______________________________________________________________________________
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
NATIONAL PORTFOLIO
------------------------------------------------------------------------------
CLASS A
------------------------------------------------------------------------------
SIX MONTHS
ENDED
APRIL 30, YEAR ENDED OCTOBER 31,
1996 ----------------------------------------------------------------
(UNAUDITED) 1995 1994 1993 1992 1991
------------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of year $10.45 $ 9.41 $11.05 $10.19 $ 9.96 $ 9.47
INCOME FROM INVESTMENT OPERATIONS
Net investment income .29** .58** .57** .61** .65** .66**
Net realized and unrealized gain (loss)
on investments (.22) 1.04 (1.37) .88 .28 .49
Net increase (decrease) in net asset
value from operations .07 1.62 (.80) 1.49 .93 1.15
LESS: DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment income (.29) (.58) (.57) (.62) (.65) (.66)
Distributions in excess of net investment
income -0- -0- (.03) -0- -0- -0-
Distributions from net realized gains -0- -0- (.24) (.01) (.05) -0-
Total dividends and distributions (.29) (.58) (.84) (.63) (.70) (.66)
Net asset value, end of period $10.23 $10.45 $ 9.41 $11.05 $10.19 $ 9.96
TOTAL RETURN
Total investment return based on net
asset value(b) .63% 17.73% (7.65)% 14.94% 9.60% 12.55%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000's omitted) $321,679 $338,311 $338,814 $386,484 $261,895 $207,167
Ratio to average net assets of:
Expenses, net of waivers/reimbursements .67%(a) .71% .62% .65% .83% .75%
Expenses, before waivers/reimbursements 1.10%(a) 1.09% 1.09% 1.08% 1.11% 1.14%
Net investment income, net of
waivers/reimbursements 5.52%(a) 5.84% 5.61% 5.69% 6.35% 6.81%
Portfolio turnover rate 72% 118% 110% 233% 86% 64%
</TABLE>
See footnote summary on page 46.
32
ALLIANCE MUNICIPAL INCOME FUND
_______________________________________________________________________________
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
NATIONAL PORTFOLIO
-----------------------------------------------------
CLASS B
-----------------------------------------------------
SIX MONTHS JANUARY 4,
ENDED 1993*
APRIL 30, YEAR ENDED OCTOBER 31, TO
1996 ------------------------ OCTOBER 31,
(UNAUDITED) 1995 1994 1993
------------- ----------- ----------- ------------
<S> <C> <C> <C> <C>
Net asset value, beginning of period $10.45 $ 9.41 $11.05 $10.43
INCOME FROM INVESTMENT OPERATIONS
Net investment income .25** .51** .50** .44**
Net realized and unrealized gain (loss)
on investments (.23) 1.04 (1.38) .63
Net increase (decrease) in net asset
value from operations .02 1.55 (.88) 1.07
LESS: DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment income (.25) (.51) (.50) (.45)
Distributions in excess of net
investment income -0- -0- (.02) -0-
Distributions from net realized gains -0- -0- (.24) -0-
Total dividends and distributions (.25) (.51) (.76) (.45)
Net asset value, end of period $10.22 $10.45 $ 9.41 $11.05
TOTAL RETURN
Total investment return based on net
asset value(b) .20% 16.91% (8.34)% 10.43%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000's omitted) $234,782 $252,357 $250,391 $216,489
Ratio to average net assets of:
Expenses, net of waivers/reimbursements 1.38%(a) 1.42% 1.32% 1.36%(a)
Expenses, before waivers/reimbursements 1.81%(a) 1.80% 1.80% 1.78%(a)
Net investment income, net of
waivers/reimbursements 4.82%(a) 5.13% 4.91% 4.59%(a)
Portfolio turnover rate 72% 118% 110% 233%
</TABLE>
See footnote summary on page 46.
33
FINANCIAL HIGHLIGHTS (CONTINUED) ALLIANCE MUNICIPAL INCOME FUND
_______________________________________________________________________________
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
NATIONAL PORTFOLIO
-----------------------------------------------------
CLASS C
-----------------------------------------------------
SIX MONTHS MAY 3,
ENDED 1993*
APRIL 30, YEAR ENDED OCTOBER 31, TO
1996 ------------------------ OCTOBER 31,
(UNAUDITED) 1995 1994 1993
------------- ----------- ----------- ------------
<S> <C> <C> <C> <C>
Net asset value, beginning of period $10.45 $ 9.41 $11.05 $10.70
INCOME FROM INVESTMENT OPERATIONS
Net investment income .25** .51** .50** .26**
Net realized and unrealized gain (loss)
on investments (.22) 1.04 (1.38) .36
Net increase (decrease) in net asset
value from operations .03 1.55 (.88) .62
LESS: DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment income (.26) (.51) (.50) (.27)
Distributions in excess of net
investment income -0- -0- (.02) -0-
Distributions from net realized gains -0- -0- (.24) -0-
Total dividends and distributions (.26) (.51) (.76) (.27)
Net asset value, end of period $10.22 $10.45 $ 9.41 $11.05
TOTAL RETURN
Total investment return based on net
asset value(b) .20% 16.93% (8.33)% 5.84%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000's omitted) $101,045 $108,068 $133,249 $150,953
Ratio to average net assets of:
Expenses, net of waivers/reimbursements 1.37%(a) 1.41% 1.31% 1.36%(a)
Expenses, before waivers/reimbursements 1.80%(a) 1.78% 1.79% 1.78%(a)
Net investment income, net of
waivers/reimbursements 4.82%(a) 5.16% 4.89% 4.17%(a)
Portfolio turnover rate 72% 118% 110% 233%
</TABLE>
See footnote summary on page 46.
34
ALLIANCE MUNICIPAL INCOME FUND
_______________________________________________________________________________
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
INSURED NATIONAL PORTFOLIO
-----------------------------------------------------------------------------
CLASS A
-----------------------------------------------------------------------------
SIX MONTHS
ENDED
APRIL 30, YEAR ENDED OCTOBER 31,
1996 --------------------------------------------------------------
(UNAUDITED) 1995 1994 1993 1992 1991
------------- ----------- ----------- ----------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of year $10.07 $ 8.96 $10.76 $ 9.87 $ 9.88 $ 9.39
INCOME FROM INVESTMENT OPERATIONS
Net investment income .25** .51** .53** .56** .60** .61**
Net realized and unrealized gain (loss)
on investments (.12) 1.13 (1.40) .96 .15 .49
Net increase (decrease) in net asset
value from operations .13 1.64 (.87) 1.52 .75 1.10
LESS: DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment income (.26) (.51) (.53) (.57) (.60) (.61)
Distributions in excess of net
investment income -0- (.02) (.01) -0- -0- -0-
Distributions from net realized gains -0- -0- (.39) (.06) (.16) -0-
Total dividends and distributions (.26) (.53) (.93) (.63) (.76) (.61)
Net asset value, end of period $ 9.94 $10.07 $ 8.96 $10.76 $ 9.87 $ 9.88
TOTAL RETURN
Total investment return based on net
asset value(b) 1.25% 18.72% (8.69)% 15.82% 7.88% 12.08%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000's omitted) $158,571 $165,548 $153,656 $185,876 $149,632 $130,723
Ratio to average net assets of:
Expenses, net of waivers/reimbursements 1.00%(a) 1.01% .66% .73% .81% .92%
Expenses, before waivers/reimbursements 1.10%(a) 1.12% 1.11% 1.11% 1.12% 1.17%
Net investment income, net of
waivers/reimbursements 4.95%(a) 5.37% 5.40% 5.40% 6.04% 6.34%
Portfolio turnover rate 95% 171% 149% 165% 105% 96%
</TABLE>
See footnote summary on page 46.
35
FINANCIAL HIGHLIGHTS (CONTINUED) ALLIANCE MUNICIPAL INCOME FUND
_______________________________________________________________________________
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
INSURED NATIONAL PORTFOLIO
-----------------------------------------------------
CLASS B
-----------------------------------------------------
SIX MONTHS JANUARY 4,
ENDED 1993*
APRIL 30, YEAR ENDED OCTOBER 31, TO
1996 ------------------------ OCTOBER 31,
(UNAUDITED) 1995 1994 1993
------------- ----------- ----------- ------------
<S> <C> <C> <C> <C>
Net asset value, beginning of period $10.07 $ 8.96 $10.76 $10.10
INCOME FROM INVESTMENT OPERATIONS
Net investment income .21** .45** .46** .40**
Net realized and unrealized gain (loss)
on investments (.12) 1.12 (1.40) .66
Net increase (decrease) in net asset
value from operations .09 1.57 (.94) 1.06
LESS: DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment income (.23) (.45) (.46) (.40)
Distributions in excess of net
investment income -0- (.01) (.01) -0-
Distributions from net realized gains -0- -0- (.39) -0-
Total dividends and distributions (.23) (.46) (.86) (.40)
Net asset value, end of period $ 9.93 $10.07 $ 8.96 $10.76
TOTAL RETURN
Total invesment return based on net
asset value(b) .82% 17.91% (9.38)% 10.68%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000's omitted) $55,121 $58,990 $51,439 $42,954
Ratio to average net assets of:
Expenses, net of waivers/reimbursements 1.71%(a) 1.72% 1.37% 1.45%(a)
Expenses, before waivers/reimbursements 1.82%(a) 1.83% 1.82% 1.83%(a)
Net investment income, net of
waivers/reimbursements 4.24%(a) 4.65% 4.71% 4.31%(a)
Portfolio turnover rate 95% 171% 149% 165%
</TABLE>
See footnote summary on page 46.
36
ALLIANCE MUNICIPAL INCOME FUND
_______________________________________________________________________________
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
INSURED NATIONAL PORTFOLIO
----------------------------------------------------
CLASS C
----------------------------------------------------
SIX MONTHS MAY 3,
ENDED 1993*
APRIL 30, YEAR ENDED OCTOBER 31, TO
1996 ------------------------ OCTOBER 31,
(UNAUDITED) 1995 1994 1993
------------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Net asset value, beginning of period $10.07 $ 8.96 $10.76 $10.41
INCOME FROM INVESTMENT OPERATIONS
Net investment income .22** .45** .46** .24**
Net realized and unrealized gain (loss)
on investments (.13) 1.12 (1.40) .35
Net increase (decrease) in net asset
value from operations .09 1.57 (.94) .59
LESS: DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment income (.23) (.45) (.46) (.24)
Distributions in excess of net
investment income -0- (.01) (.01) -0-
Distributions from net realized gains -0- -0- (.39) -0-
Total dividends and distributions (.23) (.46) (.86) (.24)
Net asset value, end of period $ 9.93 $10.07 $ 8.96 $10.76
TOTAL RETURN
Total invesment return based on net
asset value(b) .82% 17.91% (9.38)% 5.75%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000's omitted) $22,717 $22,265 $24,112 $28,862
Ratio to average net assets of:
Expenses, net of waivers/reimbursements 1.70%(a) 1.71% 1.36% 1.45%(a)
Expenses, before waivers/reimbursements 1.81%(a) 1.82% 1.81% 1.83%(a)
Net investment income, net of
waivers/reimbursements 4.25%(a) 4.69% 4.68% 3.98%(a)
Portfolio turnover rate 95% 171% 149% 165%
</TABLE>
See footnote summary on page 46.
37
FINANCIAL HIGHLIGHTS (CONTINUED) ALLIANCE MUNICIPAL INCOME FUND
_______________________________________________________________________________
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
NEW YORK PORTFOLIO
-----------------------------------------------------------------------------
CLASS A
-----------------------------------------------------------------------------
SIX MONTHS
ENDED
APRIL 30, YEAR ENDED OCTOBER 31,
1996 --------------------------------------------------------------
(UNAUDITED) 1995 1994 1993 1992 1991
------------- ----------- ----------- ----------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of year $ 9.62 $ 8.72 $10.17 $ 9.53 $ 9.30 $ 8.78
INCOME FROM INVESTMENT OPERATIONS
Net investment income .27** .55** .55** .57** .60** .62**
Net realized and unrealized gain (loss)
on investments (.14) .90 (1.40) .79 .24 .52
Net increase (decrease) in net asset
value from operations .13 1.45 (.85) 1.36 .84 1.14
LESS: DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment income (.31) (.55) (.55) (.58) (.60) (.62)
Distributions in excess of net
investment income -0- -0- (.01) -0- -0- -0-
Distributions from net realized gains -0- -0- (.04) (.14) (.01) -0-
Total dividends and distributions (.31) (.55) (.60) (.72) (.61) (.62)
Net asset value, end of period $ 9.44 $ 9.62 $ 8.72 $10.17 $ 9.53 $ 9.30
TOTAL RETURN
Total investment return based on net
asset value(b) .93% 17.10% (8.76)% 14.71% 9.39% 13.36%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000's omitted) $177,839 $183,987 $182,170 $214,259 $162,549 $136,484
Ratio to average net assets of:
Expenses, net of waivers/reimbursements .63%(a) .75% .66% .68% .70% .65%
Expenses, before waivers/reimbursements 1.10%(a) 1.12% 1.11% 1.13% 1.13% 1.20%
Net investment income, net of
waivers/reimbursements 5.61%(a) 5.93% 5.75% 5.76% 6.37% 6.81%
Portfolio turnover rate 26% 69% 69% 63% 69% 48%
</TABLE>
See footnote summary on page 46.
38
ALLIANCE MUNICIPAL INCOME FUND
_______________________________________________________________________________
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
NEW YORK PORTFOLIO
-----------------------------------------------------
CLASS B
-----------------------------------------------------
SIX MONTHS JANUARY 4,
ENDED 1993*
APRIL 30, YEAR ENDED OCTOBER 31, TO
1996 ------------------------ OCTOBER 31,
(UNAUDITED) 1995 1994 1993
------------- ----------- ----------- ------------
<S> <C> <C> <C> <C>
Net asset value, beginning of period $ 9.62 $ 8.72 $10.17 $ 9.61
INCOME FROM INVESTMENT OPERATIONS
Net investment income .24** .48** .48** .41**
Net realized and unrealized gain (loss)
on investments (.18) .90 (1.41) .56
Net increase (decrease) in net asset
value from operations .06 1.38 (.93) .97
LESS: DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment income (.24) (.48) (.47) (.41)
Distributions in excess of net
investment income -0- -0- (.01) -0-
Distributions from net realized gains -0- -0- (.04) -0-
Total dividends and distributions (.24) (.48) (.52) (.41)
Net asset value, end of period $ 9.44 $ 9.62 $ 8.72 $10.17
TOTAL RETURN
Total investment return based on net
asset value(b) .57% 16.19% (9.44)% 10.29%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000's omitted) $96,755 $94,400 $81,941 $58,504
Ratio to average net assets of:
Expenses, net of waivers/reimbursements 1.34%(a) 1.45% 1.36% 1.39%(a)
Expenses, before waivers/reimbursements 1.81%(a) 1.83% 1.82% 1.84%(a)
Net investment income, net of
waivers/reimbursements 4.90%(a) 5.21% 5.05% 4.70%(a)
Portfolio turnover rate 26% 69% 69% 63%
</TABLE>
See footnote summary on page 46.
39
FINANCIAL HIGHLIGHTS (CONTINUED) ALLIANCE MUNICIPAL INCOME FUND
_______________________________________________________________________________
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
NEW YORK PORTFOLIO
-----------------------------------------------------
CLASS C
-----------------------------------------------------
SIX MONTHS MAY 3,
ENDED 1993*
APRIL 30, YEAR ENDED OCTOBER 31, TO
1996 ------------------------ OCTOBER 31,
(UNAUDITED) 1995 1994 1993
------------- ----------- ----------- ------------
<S> <C> <C> <C> <C>
Net asset value, beginning of period $ 9.62 $ 8.72 $10.17 $ 9.89
INCOME FROM INVESTMENT OPERATIONS
Net investment income .24** .48** .48** .24**
Net realized and unrealized gain (loss)
on investments (.18) .90 (1.41) .29
Net increase (decrease) in net asset
value from operations .06 1.38 (.93) .53
LESS: DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment income (.24) (.48) (.47) (.25)
Distributions in excess of net
investment income -0- -0- (.01) -0-
Distributions from net realized gains -0- -0- (.04) -0-
Total dividends and distributions (.24) (.48) (.52) (.25)
Net asset value, end of period $ 9.44 $ 9.62 $ 8.72 $10.17
TOTAL RETURN
Total investment return based on net
asset value(b) .57% 16.19% (9.44)% 5.37%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000's omitted) $33,085 $32,259 $34,646 $38,245
Ratio to average net assets of:
Expenses, net of waivers/reimbursements 1.33%(a) 1.44% 1.36% 1.38%(a)
Expenses, before waivers/reimbursements 1.80%(a) 1.82% 1.81% 1.84%(a)
Net investment income, net of
waivers/reimbursements 4.90%(a) 5.24% 5.03% 4.42%(a)
Portfolio turnover rate 26% 69% 69% 63%
</TABLE>
See footnote summary on page 46.
40
ALLIANCE MUNICIPAL INCOME FUND
_______________________________________________________________________________
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
CALIFORNIA PORTFOLIO
-----------------------------------------------------------------------------
CLASS A
-----------------------------------------------------------------------------
SIX MONTHS
ENDED
APRIL 30, YEAR ENDED OCTOBER 31,
1996 --------------------------------------------------------------
(UNAUDITED) 1995 1994 1993 1992 1991
------------- ----------- ----------- ----------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of year $10.45 $ 9.43 $10.90 $10.06 $ 9.97 $ 9.58
INCOME FROM INVESTMENT OPERATIONS
Net investment income .29** .59** .59** .61** .65** .67**
Net realized and unrealized gain (loss)
on investments (.15) 1.02 (1.41) .85 .13 .39
Net increase (decrease) in net asset
value from operations .14 1.61 (.82) 1.46 .78 1.06
LESS: DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment income (.29) (.59) (.59) (.61) (.65) (.67)
Distributions from net realized gains -0- -0- (.06) (.01) (.04) -0-
Total dividends and distributions (.29) (.59) (.65) (.62) (.69) (.67)
Net asset value, end of period $10.30 $10.45 $ 9.43 $10.90 $10.06 $ 9.97
TOTAL RETURN
Total investment return based on net
asset value(b) 1.33% 17.55% (7.73)% 14.90% 8.05% 11.42%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000's omitted) $466,671 $478,535 $470,308 $531,293 $361,661 $228,755
Ratio to average net assets of:
Expenses, net of waivers/reimbursements .74%(a) .74% .64% .74% .59% .39%
Expenses, before waivers/reimbursements 1.04%(a) 1.04% 1.05% 1.06% 1.07% 1.11%
Net investment income, net of
waivers/reimbursements 5.53%(a) 5.90% 5.78% 5.74% 6.38% 6.80%
Portfolio turnover rate 26% 39% 45% 83% 77% 106%
</TABLE>
See footnote summary on page 46.
41
FINANCIAL HIGHLIGHTS (CONTINUED) ALLIANCE MUNICIPAL INCOME FUND
_______________________________________________________________________________
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
CALIFORNIA PORTFOLIO
-----------------------------------------------------
CLASS B
-----------------------------------------------------
SIX MONTHS JANUARY 4,
ENDED 1993*
APRIL 30, YEAR ENDED OCTOBER 31, TO
1996 ------------------------ OCTOBER 31,
(UNAUDITED) 1995 1994 1993
------------- ----------- ----------- ------------
<S> <C> <C> <C> <C>
Net asset value, beginning of period $10.45 $ 9.43 $10.90 $10.27
INCOME FROM INVESTMENT OPERATIONS
Net investment income .25** .51** .52** .44**
Net realized and unrealized gain (loss)
on investments (.15) 1.02 (1.41) .63
Net increase (decrease) in net asset
value from operations .10 1.53 (.89) 1.07
LESS: DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment income (.25) (.51) (.52) (.44)
Distributions from net realized gains -0- -0- (.06) -0-
Total dividends and distributions (.25) (.51) (.58) (.44)
Net asset value, end of period $10.30 $10.45 $ 9.43 $10.90
TOTAL RETURN
Total investment return based on net
asset value(b) .96% 16.64% (8.43)% 10.60%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000's omitted) $164,452 $166,759 $160,879 $126,688
Ratio to average net assets of:
Expenses, net of waivers/reimbursements 1.45%(a) 1.45% 1.35% 1.44%(a)
Expenses, before waivers/reimbursements 1.75%(a) 1.75% 1.75% 1.78%(a)
Net investment income, net of
waivers/reimbursements 4.82%(a) 5.19% 5.07% 4.66%(a)
Portfolio turnover rate 26% 39% 45% 83%
</TABLE>
See footnote summary on page 46.
42
ALLIANCE MUNICIPAL INCOME FUND
_______________________________________________________________________________
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
CALIFORNIA PORTFOLIO
-----------------------------------------------------
CLASS C
-----------------------------------------------------
SIX MONTHS MAY 3,
ENDED 1993*
APRIL 30, YEAR ENDED OCTOBER 31, TO
1996 ------------------------ OCTOBER 31,
(UNAUDITED) 1995 1994 1993
------------- ----------- ----------- ------------
<S> <C> <C> <C> <C>
Net asset value, beginning of period $10.45 $9.43 $10.90 $10.54
INCOME FROM INVESTMENT OPERATIONS
Net investment income .25** .51** .52** .26**
Net realized and unrealized gain (loss)
on investments (.15) 1.02 (1.41) .36
Net increase (decrease) in net asset
value from operations .10 1.53 (.89) .62
LESS: DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment income (.25) (.51) (.52) (.26)
Distributions from net realized gains -0- -0- (.06) -0-
Total dividends and distributions (.25) (.51) (.58) (.26)
Net asset value, end of period $10.30 $10.45 $9.43 $10.90
TOTAL RETURN
Total investment return based on net
asset value(b) .97% 16.64% (8.43)% 5.98%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000's omitted) $91,003 $87,793 $103,622 $117,379
Ratio to average net assets of:
Expenses, net of waivers/reimbursements 1.44%(a) 1.44% 1.34% 1.44%(a)
Expenses, before waivers/reimbursements 1.74%(a) 1.74% 1.75% 1.78%(a)
Net investment income, net of
waivers/reimbursements 4.83%(a) 5.22% 5.06% 4.42%(a)
Portfolio turnover rate 26% 39% 45% 83%
</TABLE>
See footnote summary on page 46.
43
FINANCIAL HIGHLIGHTS (CONTINUED) ALLIANCE MUNICIPAL INCOME FUND
_______________________________________________________________________________
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
INSURED CALIFORNIA PORTFOLIO
-----------------------------------------------------------------------------
CLASS A
-----------------------------------------------------------------------------
SIX MONTHS
ENDED
APRIL 30, YEAR ENDED OCTOBER 31,
1996 --------------------------------------------------------------
(UNAUDITED) 1995 1994 1993 1992 1991
------------- ----------- ----------- ----------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of year $13.32 $11.79 $14.25 $12.99 $12.80 $12.19
INCOME FROM INVESTMENT OPERATIONS
Net investment income .33 .68** .69** .70** .76** .77**
Net realized and unrealized gain (loss)
on investments (.40) 1.54 (1.99) 1.30 .18 .61
Net increase (decrease) in net asset
value from operations (.07) 2.22 (1.30) 2.00 .94 1.38
LESS: DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment income (.34) (.68) (.69) (.71) (.75) (.77)
Dividends in excess of net
investment income -0- (.01) -0- -0- -0- -0-
Distributions from net realized gains -0- -0- (.47) (.03) -0- -0-
Total dividends and distributions (.34) (.69) (1.16) (.74) (.75) (.77)
Net asset value, end of period $12.91 $13.32 $11.79 $14.25 $12.99 $12.80
TOTAL RETURN
Total investment return based on net
asset value(b) (.61)% 19.29% (9.73)% 15.64% 7.52% 11.62%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000's omitted) $101,158 $103,940 $94,857 $120,734 $90,477 $69,757
Ratio to average net assets of:
Expenses, net of waivers/reimbursements 1.06%(a) 1.04% .82% .94% .78% .79%
Expenses, before waivers/reimbursements 1.06%(a) 1.09% 1.08% 1.08% 1.09% 1.20%
Net investment income, net of
waivers/reimbursements 4.98%(a) 5.34% 5.29% 5.06% 5.77% 6.13%
Portfolio turnover rate 63% 103% 100% 186% 60% 59%
</TABLE>
See footnote summary on page 46.
44
ALLIANCE MUNICIPAL INCOME FUND
_______________________________________________________________________________
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
INSURED CALIFORNIA PORTFOLIO
-----------------------------------------------------
CLASS B
-----------------------------------------------------
SIX MONTHS JANUARY 4,
ENDED 1993*
APRIL 30, YEAR ENDED OCTOBER 31, TO
1996 ------------------------ OCTOBER 31,
(UNAUDITED) 1995 1994 1993
------------- ----------- ----------- ------------
<S> <C> <C> <C> <C>
Net asset value, beginning of period $13.32 $11.79 $14.25 $13.37
INCOME FROM INVESTMENT OPERATIONS
Net investment income .29 .58** .60** .49**
Net realized and unrealized gain (loss)
on investments (.40) 1.54 (2.00) .89
Net increase (decrease) in net asset
value from operations (.11) 2.12 (1.40) 1.38
LESS: DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment income (.29) (.58) (.59) (.50)
Distributions in excess of net
investment income -0- (.01) -0- -0-
Distributions from net realized gains -0- -0- (.47) -0-
Total dividends and distributions (.29) (.59) (1.06) (.50)
Net asset value, end of period $12.92 $13.32 $11.79 $14.25
TOTAL RETURN
Total investment return based on net
asset value(b) (.90)% 18.35% (10.43)% 10.43%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000's omitted) $29,379 $27,816 $24,591 $21,234
Ratio to average net assets of:
Expenses, net of waivers/reimbursements 1.76%(a) 1.74% 1.53% 1.65%(a)
Expenses, before waivers/reimbursements 1.76%(a) 1.80% 1.78% 1.79%(a)
Net investment income, net of
waivers/reimbursements 4.28%(a) 4.61% 4.60% 3.85%(a)
Portfolio turnover rate 63% 103% 100% 186%
</TABLE>
See footnote summary on page 46.
45
FINANCIAL HIGHLIGHTS (CONTINUED) ALLIANCE MUNICIPAL INCOME FUND
_______________________________________________________________________________
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
INSURED CALIFORNIA PORTFOLIO
-----------------------------------------------------
CLASS C
-----------------------------------------------------
SIX MONTHS MAY 3,
ENDED 1993*
APRIL 30, YEAR ENDED OCTOBER 31, TO
1996 ------------------------ OCTOBER 31,
(UNAUDITED) 1995 1994 1993
------------- ----------- ----------- ------------
<S> <C> <C> <C> <C>
Net asset value, beginning of period $13.32 $11.79 $14.25 $13.78
INCOME FROM INVESTMENT OPERATIONS
Net investment income .29 .58** .60** .29**
Net realized and unrealized gain (loss)
on investments (.41) 1.54 (2.00) .48
Net increase (decrease) in net asset
value from operations (.12) 2.12 (1.40) .77
LESS: DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment income (.29) (.58) (.59) (.30)
Distributions in excess of net
investment income -0- (.01) -0- -0-
Distributions from net realized gains -0- -0- (.47) -0-
Total dividends and distributions (.29) (.59) (1.06) (.30)
Net asset value, end of period $12.91 $13.32 $11.79 $14.25
TOTAL RETURN
Total investment return based on net
asset value(b) (.98)% 18.35% (10.43)% 5.63%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000's omitted) $14,153 $14,323 $12,472 $15,971
Ratio to average net assets of:
Expenses, net of waivers/reimbursements 1.76%(a) 1.74% 1.52% 1.65%(a)
Expenses, before waivers/reimbursements 1.76%(a) 1.79% 1.77% 1.79%(a)
Net investment income, net of
waivers/reimbursements 4.28%(a) 4.64% 4.59% 3.74%(a)
Portfolio turnover rate 63% 103% 100% 186%
</TABLE>
* Commencement of distribution.
** Net of fees waived and expenses reimbursed by the Adviser.
(a) Annualized
(b) Total investment return is calculated assuming an initial investment made
at the net asset value at the beginning of the period, reinvestment of all
dividends and distributions at net asset value during the period, and
redemption on the last day of the period. Initial sales charge or contingent
deferred sales charge is not reflected in the calculation of total investment
return. Total investment return calculated for a period less than one year is
not annualized.
46
ALLIANCE MUNICIPAL INCOME FUND
_______________________________________________________________________________
BOARD OF DIRECTORS
JOHN D. CARIFA, CHAIRMAN AND PRESIDENT
RUTH BLOCK (1)
DAVID H. DIEVLER
JAMES R. GREENE (1)
DR. JAMES M. HESTER (1)
CLIFFORD L. MICHEL (1)
EUGENE F. O'NEIL (1)
ROBERT C. WHITE (1)
OFFICERS
SUSAN P. KEENAN, SENIOR VICE PRESIDENT
WAYNE D. LYSKI, SENIOR VICE PRESIDENT
KATHLEEN A. CORBET, SENIOR VICE PRESIDENT
DAVID M. DOWDEN, VICE PRESIDENT
WILLIAM E. OLIVER, VICE PRESIDENT
TERRANCE HULTS, VICE PRESIDENT
EDMUND P. BERGAN, JR., SECRETARY
MARK D. GERSTEN, TREASURER & CHIEF FINANCIAL OFFICER
JUAN J. RODRIGUEZ, CONTROLLER
CUSTODIAN
STATE STREET BANK & TRUST COMPANY
225 Franklin Street
Boston, MA 02110
PRINCIPAL UNDERWRITER
ALLIANCE FUND DISTRIBUTORS, INC.
1345 Avenue of the Americas
New York, NY 10105
LEGAL COUNSEL
SEWARD & KISSEL
One Battery Park Plaza
New York, NY 10004
INDEPENDENT AUDITORS
ERNST & YOUNG LLP
787 Seventh Avenue
New York, NY 10019
TRANSFER AGENT
ALLIANCE FUND SERVICES, INC.
P.O. Box 1520
Secaucus, NJ 07096-1520
Toll-free 1-(800) 221-5672
(1) Member of the Audit Committee.
47
ALLIANCE MUNICIPAL INCOME FUND
1345 Avenue of the Americas
New York, NY 10105
(800) 221-5672
ALLIANCE CAPITAL
INVESTING WITHOUT THE MYSTERY.
THIS REPORT IS INTENDED SOLELY FOR DISTRIBUTION TO CURRENT SHAREHOLDERS
OF THE FUND.
R THESE REGISTERED SERVICE MARKS USED UNDER LICENSE FROM THE OWNER,
ALLIANCE CAPITAL MANAGEMENT L.P.
MUNISR
