DREYFUS PREMIER STATE MUNICIPAL BOND FUND, TEXAS SERIES
- -----------------------------------------------------------------------------
LETTER TO SHAREHOLDERS
Dear Shareholder:
We are pleased to report the performance for the Dreyfus Premier State
Municipal Bond Fund -- Texas Series for the six-month reporting period ended
October 31, 1998, as shown in the following table:
<TABLE>
ANNUALIZED
TOTAL RETURN* DISTRIBUTION RATE**
___________ _______________
<S> <C> <C>
Class A shares . . . . . . . . . . . . . . . . . . . . 4.51% 4.38%
Class B shares . . . . . . . . . . . . . . . . . . . . 4.21% 4.09%
Class C shares . . . . . . . . . . . . . . . . . . . . 4.12% 3.84%
</TABLE>
ECONOMY REVIEW
In the face of soaring consumer confidence and strong first-quarter economic
growth, the Federal Reserve Board (the "Fed") earlier this year refrained from
increasing interest rates, partially to avoid further roiling international
financial markets. In addition, the Fed evidently felt then that the economic
slowdown overseas might curtail the U.S. economy to some degree, which would
alleviate the need for monetary restraint. The Fed's expectations have proven to
be true, and its judgment accurate. The U.S. balance of trade has worsened and
there have been increasing signs of a slowdown in export-related industries. On
September 29, concerns about a weakening U.S. economy caused the Federal Open
Market Committee (the F.O.M.C. is the policy-making arm of the Fed) to pare the
Federal Funds target rate by 25 basis points, the first reduction since January
1996. (The Federal Funds rate is the rate of interest that banks charge each
other for overnight loans.) At that point, Fed Chairman Alan Greenspan described
the economic outlook for the United States as having "weakened measurably." Two
weeks later, on October 15, the F.O.M.C. again reduced the target rate by an
additional 25 basis points, putting the Federal Funds rate at 5.0%.
Despite the concerns of the Fed regarding an economic slowdown, aggregate
economic statistics showed a growing and resilient economy during the reporting
period. Low unemployment and negligible inflation, combined with car makers
rebuilding inventory after a long strike and rising consumer incomes, resulted
in solid economic growth (3.3% ) for the third quarter of this year. While a
significant portion of this gain was due to inventory replenishment after the
automobile strike, the overall results were still an improvement over
second-quarter economic growth of 1.8%. Inflation as measured by the Consumer
Price Index remained at levels not witnessed since 1963.
The Fed' s responsibility is to enact monetary policy that is anticipatory of
future economic conditions. The U.S. trade deficit has continued to widen
because of the global economic slide. Slumping exports have weakened
manufacturing activity since midyear, and there is concern that this slackness
could become more pronounced and widen into other sectors of the economy. While
the increase in imports also restrains domestic production, it has helped
contain inflation as well, since domestic producers are reluctant to raise
prices. This provides additional flexibility for the Fed to lower interest rates
still further. So far, economic problems overseas have not caused any measurable
reaction in the U.S. labor market. Only the growth rate in new jobs has eased
from its torrid pace earlier in the year. The unemployment rate has remained
near 30-year lows and worker inflation-adjusted take-home pay has been rising.
The condition of the labor market is a key determinant of consumer confidence
which, of course, relates directly to consumer spending, a force that accounts
for two thirds of all economic activity. Business spending has shown signs of
weakness, so the role of the consumer will be of even greater importance in the
future. It is significant that measures of consumer confidence have receded from
earlier record high levels, largely because of concerns about the volatility of
financial markets.
MARKET ENVIRONMENT
The supply of new issues in Texas has been rather strong over the last six
months. The Fund has been able to make selective purchases of new-issue debt at
attractive levels because of this heavy supply. On the other hand, demand
remained strong only through September and is not expected to increase until
early in 1999. The Fund intends to take advantage of this excess supply by
purchasing bonds in the secondary market where issues often can be bought at
extremely attractive levels.
Municipals are still considered to be a very good investment when compared to
U. S. Treasury bonds. A twenty-year insured AAA rated tax-exempt municipal bond
currently yields over 95% of the taxable thirty-year U. S. Treasury bond. Over
the last year, municipals have averaged 89% of Treasuries. New issue supply
normally declines as we approach the end of the year, while demand should
increase because of heavy interest payments and bond maturities on January 1,
1999. If that scenario recurs, municipals may then have a good chance of
outperforming the Treasury market.
PORTFOLIO OVERVIEW
In general, the Fund has maintained an aggressive investment posture and has
continued to purchase discounted securities, which we expect to perform well in
an improving market. Over the last six months, interest rates declined through
September but then retraced most of this decline in October. The Fund
anticipated a late summer rally and positioned itself to take advantage of
strong retail demand for bonds during this time frame. By October, retail demand
for discounts had begun to decline and the Fund became more defensive. At the
end of October, interest rates had backed up to a point where the Fund began to
purchase discounts again. This strategy will remain in place as long as
discounts can be purchased at attractive yields.
The Fund is constantly selling bonds priced at modest discounts, which have
achieved our price objective and are yielding a low return. Certain types of
investors tend to favor this type of bond, so the Fund can frequently take
advantage of this situation. Since the Fund is either buying deeper discounts or
premiums at attractive yields, it can afford to sell these issues when they
become slight discounts because they have achieved our performance goals
Lower rated issues have remained fairly expensive when compared to insured
securities. The Fund continues to take advantage of this tight spread
relationship by favoring higher rated securities, which are more liquid. This
strategy will continue to give the Fund more flexibility to react to a weak
market, which can experience liquidity constraints.
The Fund's Class A shares had a six-month total return as of October 31, 1998,
of 4.51% ,* which compares favorably to the Lipper Texas Municipal Bond average
of 4.43% . Because the Fund purchased discounts over the last six months while
interest rates fell, it was able to take advantage of an improving market that
occurred through September. The Fund is anticipating a strong demand for Texas
issues in early 1999 and is positioning the Fund to take advantage of this
opportunity in late 1998.
Included in the report is a series of detailed statements about your Fund's
holdings and its financial condition. We hope you find them informative. Please
know that we appreciate greatly your continued confidence in the Fund and in The
Dreyfus Corporation.
Very truly yours,
[Richard J. Moynihan logo signature]
Richard J. Moynihan
Director, Municipal Portfolio Management
The Dreyfus Corporation
November 16, 1998
New York, N.Y.
*Total return includes reinvestment of dividends and any capital gains paid,
and does not take into consideration the maximum initial sales charge in the
case of Class A shares, or the applicable contingent deferred sales charge
imposed on redemptions in the case of Class B and Class C shares. Income may be
subject to state and local income taxes for non-Texas residents.
**Distribution rate per share is based upon dividends per share paid from net
investment income during the period (annualized) , divided by the maximum
offering price per share at the end of the period in the case of Class A shares,
or the net asset value per share in the case of Class B and Class C shares. Some
income may be subject to the Federal Alternative Minimum Tax (AMT) for certain
shareholders.
<TABLE>
DREYFUS PREMIER STATE MUNICIPAL BOND FUND, TEXAS SERIES
- -----------------------------------------------------------------------------
STATEMENT OF INVESTMENTS OCTOBER 31, 1998 (UNAUDITED)
Principal
Long-Term Municipal Investments--96.5% Amount Value
- ------------------------------------------------------- ____________ ____________
<S> <C> <C>
Texas--93.9%
Amarillo Health Facilities Corp., HR (High Plains Baptist Hospital)
6.562%, 1/3/2022 (Insured; FSA) (Prerefunded 1/28/2002) (a) . . . . . . . . . . . . . . $ 4,500,000 $ 4,947,660
Brazos County Housing Finance Corp., SFMR, Refunding
5.75%, 3/1/2017 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15,000 15,646
Brazos Higher Education Authority Inc., Student Loan Revenue, Refunding
6.80%, 12/1/2004 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 700,000 782,089
Clear Creek Independent School District (Permanent School Fund Guaranteed)
4.25%, 2/1/2013 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,575,000 1,524,946
Clint Independent School District, Refunding (Permanent School Fund Guaranteed)
7%, 3/1/2015 (Prerefunded 3/1/1999) (a) . . . . . . . . . . . . . . . . . . . . . . . . 75,000 76,007
7%, 3/1/2015 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 675,000 683,262
Coastal Water Authority, Water Conveyance System Revenue, Refunding
6.25%, 12/15/2017 (Insured; AMBAC) . . . . . . . . . . . . . . . . . . . . . . . . . . 5,885,000 6,367,923
Dallas-Fort Worth Regional Airport, Joint Revenue
6.625%, 11/1/2021 (Insured; FGIC) . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,250,000 1,336,600
Denison Hospital Authority, HR
(Texoma Medical Center Project) 6.125%, 8/15/2017 . . . . . . . . . . . . . . . . . . . 1,000,000 1,064,290
El Paso:
5%, 8/15/2018 (Insured; FGIC) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,130,000 2,135,559
Certificate of Obligation:
4.75%, 8/15/2018 (Insured; FGIC) (b) . . . . . . . . . . . . . . . . . . . . . . . 1,560,000 1,527,552
5%, 8/15/2018 (Insured; FGIC) . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,685,000 1,689,398
El Paso Housing Authority, Multi-Family Revenue
(Section 8 Projects) 6.25%, 12/1/2009 . . . . . . . . . . . . . . . . . . . . . . . . . 2,510,000 2,673,526
El Paso Independent School District, Refunding (Permanent School Fund
Guaranteed)
Zero Coupon, 8/15/2013 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,000,000 465,250
Grape Creek-Pulliam Independent School District
Public Facility Corp., School Facility LR
7.25%, 5/15/2021 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,200,000 2,504,502
Gulf Coast Waste Disposal Authority, SWDR
(Champion International Corp. Project):
7.25%, 4/1/2017 (Prerefunded 4/1/2002) (a) . . . . . . . . . . . . . . . . . . . . 440,000 495,282
7.25%, 4/1/2017 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 560,000 609,784
Gunter Independent School District, Refunding (Permanent School Fund Guaranteed
6.05%, 8/15/2026 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,020,000 1,125,539
Hillsboro Independent School District, Refunding (Permanent School Fund
Guaranteed)
5.25%, 8/15/2026 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,750,000 1,765,190
Houston:
Airport System Special Facilities Revenue
(Automated People Mover Project) 5.375%, 7/15/2009 (Insured; FSA) . . . . . . . . . 2,000,000 2,134,440
Water and Sewer System Revenue, Refunding (Junior Lien)
5.25%, 12/1/2025 (Insured; FGIC) . . . . . . . . . . . . . . . . . . . . . . . . . 2,625,000 2,669,074
DREYFUS PREMIER STATE MUNICIPAL BOND FUND, TEXAS SERIES
- -----------------------------------------------------------------------------
STATEMENT OF INVESTMENTS (CONTINUED) OCTOBER 31, 1998 (UNAUDITED)
Principal
Long-Term Municipal Investments (continued) Amount Value
- ------------------------------------------------------- ____________ ____________
Texas (continued)
Houston Independent School District (Permanent School Fund Guaranteed)
Zero Coupon, 8/15/2015 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 3,000,000 $ 1,319,880
Irving Independent School District (Permanent School Fund Guaranteed):
Zero Coupon, 2/15/2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,985,000 1,195,665
Refunding, Zero Coupon, 2/15/2016 . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,000,000 425,730
Lakeway Municipal Utility District, Refunding
Zero Coupon, 9/1/2013 (Insured; FGIC) . . . . . . . . . . . . . . . . . . . . . . . . . 1,850,000 912,624
Leon County, PCR, Refunding (Nucor Corp. Project) 7.375%, 8/1/2009 . . . . . . . . . . . . 750,000 824,543
Misson Consolidated Independent School District
(Permanent School Fund Guaranteed) 5%, 2/15/2016 . . . . . . . . . . . . . . . . . . . 2,485,000 2,507,812
Montgomery County Health Facilities Development Corp., Hospital Mortgage Revenu
(Woodlands Medical Center Project) 8.85%, 8/15/2014 (Prerefunded 8/15/1999) (a) . . . . 545,000 579,684
North Texas Higher Education Authority, Inc., Student Loan Revenue
7.25%, 4/1/2003 (Insured; AMBAC) . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,000,000 1,061,650
Port of Bay City Authority, Matagorda County Revenue
(Hoechst Celanese Corp. Project) 6.50%, 5/1/2026 . . . . . . . . . . . . . . . . . . . 3,500,000 3,914,330
Round Rock Independent School District (Permanent School Fund Guaranteed)
4.50%, 8/1/2016 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,950,000 1,870,362
Texas (Veterans Housing Assistance) 6.80%, 12/1/2023 . . . . . . . . . . . . . . . . . . . 2,725,000 2,944,226
Texas Department Housing and Community Affairs, MFHR
(Harbors and Plumtree) 6.35%, 7/1/2016 . . . . . . . . . . . . . . . . . . . . . . . . 1,300,000 1,382,888
Texas Higher Education Coordinating Board, College Student Loan Revenue
7.30%, 10/1/2003 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 525,000 575,279
Texas National Research Laboratory Commission Financing Corp., LR
(Superconducting Super Collider) 6.95%, 12/1/2012 . . . . . . . . . . . . . . . . . . . 700,000 848,015
Texas Public Property Finance Corp., Revenue (Mental Health and Retardation)
8.875%, 9/1/2011 (Prerefunded 9/1/2001) (a) . . . . . . . . . . . . . . . . . . . . . . 455,000 525,175
Texas Southern University, Revenue 5.75%, 8/1/2018 (Insured; MBIA) . . . . . . . . . . . . 3,490,000 3,668,374
Texas, University System Revenue Financing System
4.75%, 3/15/2016 (Insured; FSA) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,370,000 4,301,216
Texas Water Development Board, Revenue (State Revolving Fund)
4.75%, 7/15/2020 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,000,000 966,400
Texoma Housing Finance Corp., SFMR, Refunding
5.75%, 9/1/2017 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 235,000 242,088
Tomball Hospital Authority, Revenue, Refunding 6%, 7/1/2013. . . . . . . . . . . . . . . . 5,000,000 5,179,850
Tyler Health Facility Development Corp., HR
(East Texas Medical Center Regional Health) 6.625%, 11/1/2011 . . . . . . . . . . . . . 1,680,000 1,800,641
Waller Consolidated Independent School District
(Permanent School Fund Guaranteed) 5.25%, 2/15/2021 . . . . . . . . . . . . . . . . . . 1,000,000 1,012,020
DREYFUS PREMIER STATE MUNICIPAL BOND FUND, TEXAS SERIES
- -----------------------------------------------------------------------------
STATEMENT OF INVESTMENTS (CONTINUED) OCTOBER 31, 1998 (UNAUDITED)
Principal
Long-Term Municipal Investments (continued) Amount Value
- ------------------------------------------------------- ____________ ____________
Texas (continued)
Waxahachie Community Development Corp., Sales Tax Revenue:
Zero Coupon, 8/1/2020 (Insured; MBIA) . . . . . . . . . . . . . . . . . . . . . . . . . $ 1,430,000 $ 440,683
Zero Coupon, 8/1/2023 (Insured; MBIA) . . . . . . . . . . . . . . . . . . . . . . . . . 1,000,000 255,420
West Side Calhoun County Navigation District, SWDR
(Union Carbide Chemical and Plastics) 8.20%, 3/15/2021 . . . . . . . . . . . . . . . . 500,000 547,985
U.S. Related--2.6%
Puerto Rico Highway Transportation Authority, Highway Revenue
5.50%, 7/1/2026 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,000,000 2,090,620
_____________
TOTAL LONG-TERM MUNICIPAL INVESTMENTS
(cost $73,103,565) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $77,986,679
_____________
Short-Term Municipal Investments--4.3%
- -------------------------------------------------------
Texas:
Harris County Health Facilities Development Corp., HR, VRDN
(Methodist Hospital) 3.70%, (c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 1,300,000 $ 1,300,000
Harris County Industrial Development Corp., PCR, VRDN:
(Exxon Project) 3.70% (c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,100,000 1,100,000
(Shell Oil Co. Project) Refunding 3.70% (c) . . . . . . . . . . . . . . . . . . . . . . 1,100,000 1,100,000
_____________
TOTAL SHORT-TERM MUNICIPAL INVESTMENTS
(cost $3,500,000) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 3,500,000
_____________
TOTAL INVESTMENTS (cost $76,603,565) . . . . . . . . . . . . . . . . . . . . . . . . . . 100.8% $81,486,679
_______ _____________
LIABILITIES, LESS CASH AND RECEIVABLES . . . . . . . . . . . . . . . . . . . . . . . . . (.8%) $ (630,037)
_______ _____________
NET ASSETS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100.0% $80,856,642
_______ _____________
DREYFUS PREMIER STATE MUNICIPAL BOND FUND, TEXAS SERIES
- -----------------------------------------------------------------------------
Summary of Abbreviations
- -----------------------------------------------------------------------------
AMBAC American Municipal Bond Assurance Corporation MFHR Multi-Family Housing Revenue
FGIC Financial Guaranty Insurance Company PCR Pollution Control Revenue
FSA Financial Security Assurance SFMR Single Family Mortgage Revenue
HR Hospital Revenue SWDR Solid Waste Disposal Revenue
LR Lease Revenue VRDN Variable Rate Demand Notes
MBIA Municipal Bond Investors Assurance
Insurance Corporation
Summary of Combined Ratings (Unaudited)
- -----------------------------------------------------------------------------
Fitch or Moody's or Standard & Poor's Percentage of Value
______ _______ ________________ _________________
AAA Aaa AAA 60.7%
AA Aa AA 4.6
A A A 14.0
BBB Baa BBB 15.0
F1 MIG1/P1 SP1/A1 4.3
Not Rated (d) Not Rated (d) Not Rated (d) 1.4
_______
100.0%
_______
Notes to Statement of Investments:
- -----------------------------------------------------------------------------
(a) Bonds which are prerefunded are collateralized by U.S. Government
securities which are held in escrow and are used to pay principal and
interest on the municipal issue and to retire the bonds in full at the
earliest refunding date.
(b) Purchased on a delayed delivery basis.
(c) Securities payable on demand. Variable interest rate--subject to periodic
change.
(d) Securities which, while not rated by Fitch, Moody's and Standard & Poor's
have been determined by the Manager to be of comparable quality to those
rated securities in which the Fund may invest.
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
<TABLE>
DREYFUS PREMIER STATE MUNICIPAL BOND FUND, TEXAS SERIES
- -----------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES OCTOBER 31, 1998 (UNAUDITED)
Cost Value
____________ ____________
<S> <C> <C>
ASSETS: Investments in securities--See Statement of Investments . . $76,603,565 $81,486,679
Cash . . . . . . . . . . . . . . . . . . . . . . . . . . 228,929
Interest receivable . . . . . . . . . . . . . . . . . . . 1,262,492
Receivable for shares of Beneficial Interest subscribed . . 70,050
Prepaid expenses . . . . . . . . . . . . . . . . . . . . 6,147
_____________
83,054,297
_____________
LIABILITIES: Due to The Dreyfus Corporation and affiliates . . . . . . 34,458
Due to Distributor . . . . . . . . . . . . . . . . . . . 26,319
Payable for investment securities purchased . . . . . . . 1,527,431
Payable for shares of Beneficial Interest redeemed . . . 605,528
Accrued expenses . . . . . . . . . . . . . . . . . . . . 3,919
_____________
2,197,655
_____________
NET ASSETS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $80,856,642
_____________
_____________
REPRESENTED BY: Paid-in capital . . . . . . . . . . . . . . . . . . . . . $74,077,408
Accumulated net realized gain (loss) on investments . . . 1,896,120
Accumulated net unrealized appreciation (depreciation)
on investments--Note 4 . . . . . . . . . . . . . . . . 4,883,114
_____________
NET ASSETS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $80,856,642
_____________
NET ASSET VALUE PER SHARE
--------------------
Class A Class B Class C
_____________ _____________ ______________
Net Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $59,626,019 $20,869,249 $ 361,374
Shares Outstanding . . . . . . . . . . . . . . . . . . . . . . . . . . 2,693,238 942,847 16,332
NET ASSET VALUE PER SHARE. . . . . . . . . . . . . . . . . . . . . . . $22.14 $22.13 $22.13
_______ _______ _______
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
<TABLE>
DREYFUS PREMIER STATE MUNICIPAL BOND FUND, TEXAS SERIES
- -----------------------------------------------------------------------------
STATEMENT OF OPERATIONS SIX MONTHS ENDED OCTOBER 31, 1998 (UNAUDITED)
INVESTMENT INCOME
<S> <C> <C>
INCOME Interest Income . . . . . . . . . . . . . . . . . $2,223,170
EXPENSES: Management fee--Note 3(a) . . . . . . . . . . . . $ 223,498
Shareholder servicing costs--Note 3(c) . . . . . 119,262
Distribution fees--Note 3(b) . . . . . . . . . . 52,851
Professional fees . . . . . . . . . . . . . . . . 6,979
Registration fees . . . . . . . . . . . . . . . . 6,078
Prospectus and shareholders' reports . . . . . . 5,821
Custodian fees . . . . . . . . . . . . . . . . . 4,760
Trustees' fees and expenses--Note 3(d) . . . . . 508
Loan commitment fees--Note 2 . . . . . . . . . . 197
Miscellaneous . . . . . . . . . . . . . . . . . . 4,885
___________
Total Expenses . . . . . . . . . . . . . . . . 424,839
Less--reduction in management fee due to
undertaking--Note 3(a) . . . . . . . . . . . . (26,386)
___________
Net Expenses . . . . . . . . . . . . . . . . . 398,453
___________
INVESTMENT INCOME--NET . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,824,717
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS--Note 4:
Net realized gain (loss) on investments . . . . . $1,062,638
Net unrealized appreciation (depreciation)
on investments . . . . . . . . . . . . . . . . 604,515
___________
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS . . . . . . . . . . . . . . 1,667,153
___________
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS . . . . . . . . . . . . . . . $3,491,870
___________
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
<TABLE>
DREYFUS PREMIER STATE MUNICIPAL BOND FUND, TEXAS SERIES
- -----------------------------------------------------------------------------
STATEMENT OF CHANGES IN NET ASSETS
Six Months Ended
October 31, 1998 Year Ended
(Unaudited) April 30, 1998
_______________ _______________
<S> <C> <C>
OPERATIONS:
Investment income--net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 1,824,717 $ 3,894,454
Net realized gain (loss) on investments . . . . . . . . . . . . . . . . . . . . . 1,062,638 1,306,332
Net unrealized appreciation (depreciation) on investments . . . . . . . . . . . . 604,515 2,405,268
_____________ ____________
Net Increase (Decrease) in Net Assets Resulting from Operations . . . . . 3,491,870 7,606,054
_____________ ____________
DIVIDENDS TO SHAREHOLDERS FROM:
Investment income--net:
Class A shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1,393,331) (3,051,372)
Class B shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (424,838) (835,063)
Class C shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (6,548) (8,019)
Net realized gain on investments:
Class A shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . -- (847,695)
Class B shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . -- (260,030)
Class C shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . -- (2,729)
_____________ ____________
Total Dividends . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1,824,717) (5,004,908)
_____________ ____________
BENEFICIAL INTEREST TRANSACTIONS:
Net proceeds from shares sold:
Class A shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,881,256 2,175,343
Class B shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,301,600 3,816,097
Class C shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 101,706 126,463
Dividends reinvested:
Class A shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 604,129 1,873,726
Class B shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 265,271 650,003
Class C shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,242 1,286
Cost of shares redeemed:
Class A shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (3,854,695) (7,168,993)
Class B shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1,574,805) (1,976,539)
Class C shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (9,998) (41)
_____________ ____________
Increase (Decrease) in Net Assets from Beneficial Interest Transactions . (1,283,294) (502,655)
_____________ ____________
Total Increase (Decrease) in Net Assets . . . . . . . . . . . . . . . . 383,859 2,098,491
NET ASSETS:
Beginning of Period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80,472,783 78,374,292
_____________ ____________
End of Period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $80,856,642 $80,472,783
_____________ ____________
SEE NOTES TO FINANCIAL STATEMENTS.
DREYFUS PREMIER STATE MUNICIPAL BOND FUND, TEXAS SERIES
- -----------------------------------------------------------------------------
STATEMENT OF CHANGES IN NET ASSETS (CONTINUED)
Shares
________________________________
Six Months Ended
October 31, 1998 Year Ended
(Unaudited) April 30, 1998
_______________ _____________
CAPITAL SHARE TRANSACTIONS:
Class A
________
Shares sold . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85,517 100,070
Shares issued for dividends reinvested . . . . . . . . . . . . . . . . . . . . . . . 27,407 86,362
Shares redeemed . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (175,563) (329,855)
________ _________
Net Increase (Decrease) in Shares Outstanding . . . . . (62,639) (143,423)
________ _________
Class B
________
Shares sold . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59,135 175,410
Shares issued for dividends reinvested . . . . . . . . . . . . . . . . . . . . . . . 12,034 29,952
Shares redeemed . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (71,777) (90,921)
________ _________
Net Increase (Decrease) in Shares Outstanding . . . . . (608) 114,441
________ _________
Class C
________
Shares sold . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,635 5,845
Shares issued for dividends reinvested . . . . . . . . . . . . . . . . . . . . . . . 101 59
Shares redeemed . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (458) (2)
________ _________
Net Increase (Decrease) in Shares Outstanding . . . . . 4,278 5,902
________ _________
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
<TABLE>
DREYFUS PREMIER STATE MUNICIPAL BOND FUND, TEXAS SERIES
- -----------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
Contained below is per share operating performance data for a share of
Beneficial Interest outstanding, total investment return, ratios to average net
assets and other supplemental data for each period indicated. This information
has been derived from the Fund's financial statements.
Class A Shares
________________________________________________________________________
Six Months Ended
October 31, 1998 Year Ended April 30,
_____________________________________________________________
PER SHARE DATA: (Unaudited) 1998 1997 1996 1995 1994
____________________ _______ _______ _______ _______ _______
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period . . . $21.68 $20.99 $20.84 $20.69 $20.41 $21.23
_______ _______ _______ _______ _______ _______
Investment Operations:
Investment income--net . . . . . . . . . . .51 1.08 1.17 1.20 1.22 1.25
Net realized and unrealized gain (loss)
on investments . . . . . . . . . . . . .46 .99 .41 .45 .28 (.66)
_______ _______ _______ _______ _______ _______
Total from Investment Operations . . . . . .97 2.07 1.58 1.65 1.50 .59
_______ _______ _______ _______ _______ _______
Distributions:
Dividends from investment income--net . . . (.51) (1.08) (1.17) (1.20) (1.22) (1.25)
Dividends from net realized gain on investments -- (.30) (.26) (.30) -- (.13)
Dividends in excess of net realized gain
on investments . . . . . . . . . . . . -- -- -- -- -- (.03)
_______ _______ _______ _______ _______ _______
Total Distributions . . . . . . . . . . . . (.51) (1.38) (1.43) (1.50) (1.22) (1.41)
_______ _______ _______ _______ _______ _______
Net asset value, end of period . . . . . . $22.14 $21.68 $20.99 $20.84 $20.69 $20.41
_______ _______ _______ _______ _______ _______
TOTAL INVESTMENT RETURN(1) . . . . . . . . . . 8.95%(2) 10.03% 7.74% 8.06% 7.63% 2.62%
RATIOS/SUPPLEMENTAL DATA:
Ratio of expenses to average net assets . . .85%(2) .72% .37% .37% .37% .39%
Ratio of net investment income
to average net assets . . . . . . . . . 4.62%(2) 4.96% 5.54% 5.64% 6.01% 5.78%
Decrease reflected in above expense ratios
due to undertakings by the Manager . . .06%(2) .18% .55% .55% .55% .55%
Portfolio Turnover Rate . . . . . . . . . . 24.86%(3) 27.18% 61.22% 49.24% 38.68% 9.68%
Net Assets, end of period (000's Omitted) . . $59,626 $59,758 $60,849 $62,864 $68,103 $76,277
- ------------------
(1) Exclusive of sales load.
(2) Annualized.
(3) Not annualized.
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
<TABLE>
DREYFUS PREMIER STATE MUNICIPAL BOND FUND, TEXAS SERIES
- -----------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
Contained below is per share operating performance data for a share of
Beneficial Interest outstanding, total investment return, ratios to average net
assets and other supplemental data for each period indicated. This information
has been derived from the Fund's financial statements.
Class B Shares
________________________________________________________________________
Six Months Ended
October 31, 1998 Year Ended April 30,
_____________________________________________________________
PER SHARE DATA: (Unaudited) 1998 1997 1996 1995 1994
____________________ _______ _______ _______ _______ _______
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period . . . $21.68 $20.98 $20.84 $20.69 $20.41 $21.23
_______ _______ _______ _______ _______ _______
Investment Operations:
Investment income--net . . . . . . . . . . .46 .97 1.06 1.09 1.10 1.13
Net realized and unrealized gain (loss)
on investments . . . . . . . . . . . . .45 1.00 .40 .45 .28 (.66)
_______ _______ _______ _______ _______ _______
Total from Investment Operations . . . . . .91 1.97 1.46 1.54 1.38 .47
_______ _______ _______ _______ _______ _______
Distributions:
Dividends from investment income--net . . . (.46) (.97) (1.06) (1.09) (1.10) (1.13)
Dividends from net realized gain on investments -- (.30) (.26) (.30) -- (.13)
Dividends in excess of net realized gain
on investments . . . . . . . . . . . . -- -- -- -- -- (.03)
_______ _______ _______ _______ _______ _______
Total Distributions . . . . . . . . . . . . (.46) (1.27) (1.32) (1.39) (1.10) (1.29)
_______ _______ _______ _______ _______ _______
Net asset value, end of period . . . . . . $22.13 $21.68 $20.98 $20.84 $20.69 $20.41
_______ _______ _______ _______ _______ _______
TOTAL INVESTMENT RETURN(1) . . . . . . . . . . 8.35%(2) 9.53% 7.15% 7.51% 7.05% 2.05%
RATIOS/SUPPLEMENTAL DATA:
Ratio of expenses to average net assets . . 1.35%(2) 1.23% .88% .88% .89% .94%
Ratio of net investment income
to average net assets . . . . . . . . . 4.12%(2) 4.44% 5.03% 5.13% 5.46% 5.15%
Decrease reflected in above expense ratios
due to undertakings by the Manager . . .07%(2) .18% .55% .55% .55% .54%
Portfolio Turnover Rate . . . . . . . . . . 24.86%(3) 27.18% 61.22% 49.24% 38.68% 9.68%
Net Assets, end of period (000's Omitted) . . $20,869 $20,454 $17,396 $17,461 $16,818 $15,878
- ------------------
(1) Exclusive of sales load.
(2) Annualized.
(3) Not annualized.
SEE NOTES TO FINANCIAL STATEMENTS.
DREYFUS PREMIER STATE MUNICIPAL BOND FUND, TEXAS SERIES
- -----------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)
Contained below is per share operating performance data for a share of
Beneficial Interest outstanding, total investment return, ratios to average net
assets and other supplemental data for each period indicated. This information
has been derived from the Fund's financial statements.
Class C Shares
________________________________________________
Six Months Ended
October 31, 1998 Year Ended April 30,
_______________________________
PER SHARE DATA: (Unaudited) 1998 1997 1996(1)
_________ _______ _______ _______
Net asset value, beginning of period . . . . . . . . . . . . . . . . . $21.67 $20.97 $20.83 $20.78
_______ _______ _______ _______
Investment Operations:
Investment income (loss)--net . . . . . . . . . . . . . . . . . . . . . .43 .91 .99 .73
Net realized and unrealized gain (loss) on investments . . . . . . . . .46 1.00 .40 .35
_______ _______ _______ _______
Total from Investment Operations . . . . . . . . . . . . . . . . . . . .89 1.91 1.39 1.08
_______ _______ _______ _______
Distributions:
Dividends from investment income--net . . . . . . . . . . . . . . . . . (.43) (.91) (.99) (.73)
Dividends from net realized gain on investments . . . . . . . . . . . . -- (.30) (.26) (.30)
_______ _______ _______ _______
Total Distributions . . . . . . . . . . . . . . . . . . . . . . . . . . (.43) (1.21) (1.25) (1.03)
_______ _______ _______ _______
Net asset value, end of period . . . . . . . . . . . . . . . . . . . . $22.13 $21.67 $20.97 $20.83
_______ _______ _______ _______
TOTAL INVESTMENT RETURN(2) . . . . . . . . . . . . . . . . . . . . . . . . 8.17%(3) 9.24% 6.79% 7.29%(3)
RATIOS/SUPPLEMENTAL DATA:
Ratio of expenses to average net assets . . . . . . . . . . . . . . . . 1.60%(3) 1.52% 1.19% 1.18%(3)
Ratio of net investment income to average net assets . . . . . . . . . 3.85%(3) 4.10% 4.57% 4.77%(3)
Decrease reflected in above expense ratios due to undertakings
by the Manager . . . . . . . . . . . . . . . . . . . . . . . . . . .10%(3) .15% .54% .58%(3)
Portfolio Turnover Rate . . . . . . . . . . . . . . . . . . . . . . . . 24.86%(4) 27.18% 61.22% 49.24%
Net Assets, end of period (000's Omitted) . . . . . . . . . . . . . . . $361 $261 $129 $1
- ------------------------
(1) From August 15, 1995 (commencement of initial offering) to April 30, 1996.
(2) Exclusive of sales load.
(3) Annualized.
(4) Not annualized.
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
DREYFUS PREMIER STATE MUNICIPAL BOND FUND, TEXAS SERIES
- -----------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
NOTE 1--Significant Accounting Policies:
Dreyfus Premier State Municipal Bond Fund (the "Trust") is registered under
the Investment Company Act of 1940, as amended (the "Act") as a non-diversified
open-end management investment company, and operates as a series company
currently offering thirteen series including the Texas Series (the "Fund"). The
Fund' s investment objective is to maximize current income exempt from Federal
and, where applicable, from State income taxes, without undue risk. The Dreyfus
Corporation (the "Manager") serves as the Fund's investment adviser. The Manager
is a direct subsidiary of Mellon Bank, N.A.
Premier Mutual Fund Services, Inc. (the "Distributor") is the distributor of
the Fund's shares. The Fund is authorized to issue an unlimited number of $.001
par value shares in the following classes of shares: Class A, Class B and Class
C shares. Class A shares are subject to a sales charge imposed at the time of
purchase, Class B shares are subject to a contingent deferred sales charge
(" CDSC") imposed on Class B share redemptions made within six years of purchase
(five years for shareholders beneficially owning Class B shares on November 30,
1996) and Class C shares are subject to a CDSC imposed on Class C shares
redeemed within one year of purchase. Other differences between the classes
include the services offered to and the expenses borne by each class and certain
voting rights.
The Trust accounts separately for the assets, liabilities and operations of
each fund. Expenses directly attributable to each fund are charged to that
fund' s operations; expenses which are applicable to all funds are allocated
among them on a pro rata basis.
The Fund' s financial statements are prepared in accordance with generally
accepted accounting principles which may require the use of management estimates
and assumption. Actual results could differ from those estimates.
(A) PORTFOLIO VALUATION: Investments in securities (excluding options and
financial futures on municipal and U.S. treasury securities) are valued each
business day by an independent pricing service ("Service") approved by the Board
of Trustees. Investments for which quoted bid prices are readily available and
are representative of the bid side of the market in the judgment of the Service
are valued at the mean between the quoted bid prices (as obtained by the Service
from dealers in such securities) and asked prices (as calculated by the Service
based upon its evaluation of the market for such securities). Other investments
(which constitute a majority of the portfolio securities) are carried at fair
value as determined by the Service, based on methods which include consideration
of: yields or prices of municipal securities of comparable quality, coupon,
maturity and type; indications as to values from dealers; and general market
conditions. Options and financial futures on municipal and U.S. treasury
securities are valued at the last sales price on the securities exchange on
which such securities are primarily traded or at the last sales price on the
national securities market on each business day. Investments not listed on an
exchange or the national securities market, or securities for which there were
no transactions, are valued at the average of the most recent bid and asked
prices. Bid price is used when no asked price is available.
(B) SECURITIES TRANSACTIONS AND INVESTMENT INCOME: Securities transactions are
recorded on a trade date basis. Realized gain and loss from securities
transactions are recorded on the identified cost basis. Interest income,
adjusted for amortization of premiums and original issue discounts on
investments, is earned from settlement date and recognized on the accrual basis.
Securities purchased or sold on a when-issued or delayed-delivery basis may be
settled a month or more after the trade date. Under the terms of the custody
agreement, the Fund received net earnings credits of $5,252 during the period
ended October 31, 1998 based on available cash balances left on deposit. Income
earned under this arrangement is included in interest income.
DREYFUS PREMIER STATE MUNICIPAL BOND FUND, TEXAS SERIES
- -----------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
The Fund follows 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 Fund.
(C) DIVIDENDS TO SHAREHOLDERS: It is the policy of the Fund to declare
dividends daily from investment income-net. Such dividends are paid monthly.
Dividends from net realized capital gain are normally declared and paid
annually, but the Fund may make distributions on a more frequent basis to comply
with the distribution requirements of the Internal Revenue Code of 1986, as
amended (the "Code"). To the extent that net realized capital gain can be offset
by capital loss carryovers, it is the policy of the Fund not to distribute such
gain.
(D) FEDERAL INCOME TAXES: It is the policy of the Fund to continue to qualify
as a regulated investment company, which can distribute tax exempt dividends, by
complying with the applicable provisions of the Code, and to make distributions
of income and net realized capital gain sufficient to relieve it from
substantially all Federal income and excise taxes.
NOTE 2--Bank Line of Credit:
The Fund participates with other Dreyfus-managed funds in a $600 million
redemption credit facility (" Facility" ) to be utilized for temporary or
emergency purposes, including the financing of redemptions. In connection
therewith, the Fund has agreed to pay commitment fees on its pro rata portion of
the Facility. Interest is charged to the Fund at rates based on prevailing
market rates in effect at the time of borrowings. During the period ended
October 31, 1998, the Fund did not borrow under the Facility.
NOTE 3--Management Fee and Other Transactions With Affiliates:
(A) Pursuant to a management agreement with the Manager, the management fee is
computed at the annual rate of .55 of 1% of the value of the Fund's average
daily net assets and is payable monthly. The Manager had undertaken from May 1,
1998 to October 31, 1998 to reduce the management fee paid by the Fund, to the
extent that the Fund' s aggregate expenses, (excluding certain expenses as
described above) exceeded an annual rate of .85 of 1% of the value of the Fund's
average daily net assets. The reduction in management fee, pursuant to the
undertaking, amounted to $26,386 during the period ended October 31, 1998.
(B) Under the Distribution Plan adopted pursuant to Rule 12b-1 under the Act,
the Fund pays the Distributor for distributing the Fund's Class B and Class C
shares at an annual rate of .50 of 1% of the value of the average daily net
assets of Class B shares and .75 of 1% of the value of the average daily net
assets of Class C shares. During the period ended October 31, 1998, Class B and
Class C shares were charged $51,575 and $1,276, respectively, pursuant to the
Distribution Plan.
(C) Under the Shareholder Services Plan, the Fund pays the Distributor at an
annual rate of .25 of 1% of the value of the average daily net assets of Class
A, Class B and Class C shares for the provision of certain services. The
services provided may include personal services relating to shareholder
accounts, such as answering shareholder inquiries regarding the Fund and
providing reports and other information, and services related to the maintenance
of shareholder accounts. The Distributor may make payments to Service Agents (a
securities dealer, financial institution or other industry professional) in
respect of these services. The Distributor determines the amounts to be paid to
Service Agents. During the period ended October 31, 1998, Class A, Class B and
Class C shares were charged $75,377, $25,787 and $426 respectively, pursuant to
the Shareholder Services Plan.
DREYFUS PREMIER STATE MUNICIPAL BOND FUND, TEXAS SERIES
- -----------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
The Fund compensates Dreyfus Transfer, Inc., a wholly-owned subsidiary of the
Manager, under a transfer agency agreement for providing personnel and
facilities to perform transfer agency services for the Fund. During the period
ended October 31, 1998, the Fund was charged $12,632 pursuant to the transfer
agency agreement.
(D) Each trustee who is not an "affiliated person" as defined in the Act
receives from the Trust an annual fee of $2,500 and an attendance fee of $250
per meeting. The Chairman of the Board receives an additional 25% of such
compensation.
NOTE 4--Securities Transactions:
The aggregate amount of purchases and sales of investment securities,
excluding short-term securities, during the period ended October 31, 1998
amounted to $19,696,235 and $24,578,178, respectively.
At October 31, 1998, accumulated net unrealized appreciation on investments
was $4,883,114, consisting of $4,889,415 gross unrealized appreciation and
$6,301 gross unrealized depreciation.
At October 31, 1998, the cost of investments for Federal income tax purposes
was substantially the same as the cost for financial reporting purposes (see the
Statement of Investments).
Dreyfus Premier State Municipal
Bond Fund, Texas Series
200 Park Avenue
New York, NY 10166
Manager
The Dreyfus Corporation
200 Park Avenue
New York, NY 10166
Custodian
The Bank of New York
90 Washington Street
New York, NY 10286
Transfer Agent &
Dividend Disbursing Agent
Dreyfus Transfer, Inc.
P.O. Box 9671
Providence, RI 02940
Printed in U.S.A. 061/621SA9810
SEMI-ANNUAL REPORT
- -------------------------------------------------------------------------------
Dreyfus Premier State
Municipal Bond Fund
Texas Series
- -------------------------------------------------------------------------------
OCTOBER 31, 1998
(reg.tm)
[reg.tm signature logo]
