DREYFUS PREMIER STATE MUNICIPAL BOND FUND, MASSACHUSETTS SERIES
- -----------------------------------------------------------------------------
LETTER TO SHAREHOLDERS
Dear Shareholder:
We are pleased to report the performance for the Dreyfus Premier State
Municipal Bond Fund -- Massachusetts 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 . . . . . . . . . . . . . . . . . . . . 4.66% 4.79%
Class B shares . . . . . . . . . . . . . . . . . . . . 4.30% 4.50%
Class C shares . . . . . . . . . . . . . . . . . . . . 4.26% 4.25%
</TABLE>
THE ECONOMY
In the face of soaring consumer confidence and strong first-quarter economic
growth, the Federal Reserve Board 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 its 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.
<PAGE>
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 environment for fixed income securities during the past six months has
been extremely positive, continuing a trend toward lower long-term interest
rates that began in the spring of 1997. As has been the case for much of this
decline in rates, economic fundamentals have not been a primary influence on the
bond market. They have been pushed aside by other factors which created a flight
to quality into U.S. Government securities as a safe haven, while many other
markets were in temporary disarray. The primary engine for lower rates has been
the economic crisis which began in Asia and has since spread to Russia and Latin
America and now appears to be impacting the U.S. economy. The threat of an
economic slowdown in the U.S., coupled with a potential global credit crunch,
forced the Federal Reserve Board to lower the Federal Funds target rate 25 basis
points twice in a two week span (September 29 and October 15) in order to buy
some insurance against a possible U.S. recession in 1999. It is likely that the
Fed will maintain an accommodative stance toward interest rates in the near
future as the current global economic slump shows no sign of ending.
Municipal securities benefited from the general decline in interest rates
during the period, although to a lesser degree than U.S. Treasuries. The fact
that municipals do not command safe-haven status, combined with a general
decrease in demand as long tax-free bonds yield less than 5%, were the primary
reasons for the underperformance versus U.S. Treasuries. Also, many
corporate-backed municipals performed poorly due to reduced earnings prospects
in a slower economy. This underperformance can easily be seen as the
municipal/Treasury yield ratio (as measured by the Bond Buyer Revenue Bond
Index/30- year Treasury yield) increased from 93% to 101%. The combination of
attractive yields relative to Treasuries, a slowing economy, and a bias toward
lower short-term interest rates bodes well for municipal securities going
forward.
PORTFOLIO OVERVIEW
The primary objective in managing the portfolio continues to be the
realization of income exempt from both Federal and Massachusetts income taxes.
In pursuing this goal, the Fund maintains a nucleus of high-coupon,
income-generating securities which produce an attractive level of tax-free
income while providing stability during flat to declining markets. However, as
the trend toward lower interest rates has become more pronounced, strategy has
also focused on lengthening the duration of the portfolio to capture more price
appreciation, should interest rates continue to decline as we anticipate
We view credit spreads as too narrow to justify adding lower quality
securities in a slowing economic environment. At present, approximately 37% of
the Fund is invested in securities which are rated "AAA" and 70% is invested in
those rated "A" or better, virtually unchanged from the start of the period
<PAGE>
While it is difficult at best to predict the future of interest rates, we
feel the portfolio is well balanced at the present. We will continue to follow
our long-term objectives and monitor the volatile investment climate in order to
position the portfolio accordingly.
Sincerely,
[Richard J. Moynihan signature logo]
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-Massachusetts 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.
<PAGE>
<TABLE>
DREYFUS PREMIER STATE MUNICIPAL BOND FUND, MASSACHUSETTS SERIES
- -----------------------------------------------------------------------------
STATEMENT OF INVESTMENTS OCTOBER 31, 1998 (UNAUDITED)
Principal
Long-Term Municipal Investments--98.1% Amount Value
- -------------------------------------------------------
__________ ____________
<S> <C> <C>
Massachusetts--81.3%
Boston Industrial Development Financing Authority, Sewer Facility Revenue
(Harbor Electric Energy Co. Project) 7.375%, 5/15/2015 . . . . . . . . . . . . . . . . . $ 2,500,000 $ 2,698,125
Leominster 7.50%, 4/1/2009 (Insured; MBIA, Prerefunded 4/1/2000) (a) . . . . . . . . . . . 1,275,000 1,370,446
Lynn Water and Sewer Commission, General Revenue
7.25%, 12/1/2010 (Insured; MBIA, Prerefunded 12/1/2000) (a) . . . . . . . . . . . . . . 1,000,000 1,093,540
Massachusetts Bay Transportation Authority:
6.904%, 3/1/2021 (Insured; MBIA) (b,c) . . . . . . . . . . . . . . . . . . . . . . . . . 2,300,000 2,487,818
7%, 3/1/2021 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,000,000 1,277,670
Massachusetts Commonwealth:
7%, 8/1/2012 (Prerefunded 8/1/2001) (a) . . . . . . . . . . . . . . . . . . . . . . . . 1,850,000 2,046,433
Special Obligation Revenue, Refunding 5.50%, 6/1/2013 . . . . . . . . . . . . . . . . . 5,000,000 5,493,700
Massachusetts Education Loan Authority, Education Loan Revenue
7.75%, 1/1/2008 (Insured; MBIA) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 965,000 1,023,749
Massachusetts Educational Financing Authority, Education Loan Revenue
5.20%, 12/1/2016 (Insured, MBIA) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,235,000 1,227,071
Massachusetts Health and Educational Facilities Authority, Revenue:
(Baystate Medical Center) 6%, 7/1/2026 (Insured; FSA) . . . . . . . . . . . . . . . . . 2,000,000 2,231,440
(Harvard Pilgram Health) 4.75%, 7/1/2022 (Insured; FSA) . . . . . . . . . . . . . . . . 3,450,000 3,287,160
(Medical Center of Central Massachusetts) 7.10%, 7/1/2021 . . . . . . . . . . . . . . . 1,000,000 1,080,150
(Refunding-Boston College) 4.75%, 6/1/2031 . . . . . . . . . . . . . . . . . . . . . . . 4,500,000 4,247,415
(Refunding-Milton Hospital) 7%, 7/1/2016 (Insured; MBIA) . . . . . . . . . . . . . . . . 2,050,000 2,191,594
(University Hospital) 7.25%, 7/1/2019 (Insured; MBIA, Prerefunded 7/1/2000) ) (a) . . . 2,750,000 2,970,110
Massachusetts Industrial Finance Agency, Revenue:
(Babson College) 5.25%, 10/1/2027 . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,000,000 4,047,920
(Babson College) 4.75%, 10/1/2028 (Insured; MBIA) . . . . . . . . . . . . . . . . . . . 1,700,000 1,620,389
(Provider Lease Program) 8.75%, 7/15/2009 . . . . . . . . . . . . . . . . . . . . . . . 645,000 658,261
(Water Treatment-American Hingham) 6.95%, 12/1/2035 . . . . . . . . . . . . . . . . . . 3,000,000 3,340,860
(Wentworth Institute Technology) 5.75%, 10/1/2028 . . . . . . . . . . . . . . . . . . . 1,650,000 1,712,700
Health Care Facility (Health Foundation, Inc. Project) 6.75%, 12/1/2027 . . . . . . . . 1,000,000 1,072,740
Package Facility (Avon Associates LLC) 5.375%, 4/1/2020 (Insured; MBIA) . . . . . . . . 2,950,000 3,020,535
Resource Recovery, Refunding (Ogden Haverhill Project) 5.60%, 12/1/2019 . . . . . . . . 1,000,000 1,003,520
Massachusetts Port Authority, Revenue:
5%, 7/1/2027 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,025,000 1,001,271
5%, 7/1/2028 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 700,000 678,384
Special Project (Harborside Hyatt) 10%, 3/1/2026 . . . . . . . . . . . . . . . . . . . . 3,000,000 3,324,330
Massachusetts Water Pollution Abatement Trust
(Pool Loan Program) 5.40%, 2/1/2011 . . . . . . . . . . . . . . . . . . . . . . . . . . 175,000 187,796
Massachusetts Water Resource Authority 4%, 12/1/2018 (Insured; MBIA) . . . . . . . . . . . 2,000,000 1,765,660
U.S. Related--16.8%
Guam Airport Authority, Revenue 6.70%, 10/1/2023 . . . . . . . . . . . . . . . . . . . . . 1,500,000 1,642,740
Puerto Rico Commonwealth, Refunding 6%, 7/1/2014 . . . . . . . . . . . . . . . . . . . . . 1,000,000 1,073,960
<PAGE>
DREYFUS PREMIER STATE MUNICIPAL BOND FUND, MASSACHUSETTS SERIES
- -----------------------------------------------------------------------------
STATEMENT OF INVESTMENTS OCTOBER 31, 1998 (UNAUDITED)
Principal
Long-Term Municipal Investments (continued) Amount Value
- -------------------------------------------------------
____________ ____________
U.S. Related (continued)
Puerto Rico Commonwealth Highway and Transportation Authority, Highway Revenue:
6.106%, 7/1/2009 (b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 1,000,000 $ 1,123,750
6.206%, 7/1/2010 (b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,000,000 1,123,750
5%, 7/1/2036 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,000,000 2,015,080
Puerto Rico Housing Finance Corporation, MFMR
7.50%, 4/1/2022 (LOC; Government Development Bank) . . . . . . . . . . . . . . . . . . . 570,000 607,848
Puerto Rico Public Buildings Authority,
Guaranteed Government Facilities Revenue 6.25%, 7/1/2015 (Insured; AMBAC) . . . . . . . 1,100,000 1,297,560
Virgin Islands Public Finance Authority, Revenue, Refunding
7.25%, 10/1/2018 (Prerefunded 10/1/2002) . . . . . . . . . . . . . . . . . . . . . . . . 2,750,000 3,153,948
____________
TOTAL INVESTMENTS (cost $65,704,451) . . . . . . . . . . . . . . . . . . . . . . . . . . . 98.1% $70,199,423
_______ _____________
CASH AND RECEIVABLES (NET) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.9% $ 1,342,278
_______ _____________
NET ASSETS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100.0% $71,541,701
_______ _____________
Summary of Abbreviations
- -----------------------------------------------------------------------------
AMBAC American Municipal Bond Assurance Corporation MBIA Municipal Bond Investors Assurance
FSA Financial Security Assurance Insurance Corporation
LOC Letter of Credit MFMR Multi-Family Mortgage Revenue
Summary of Combined Ratings
- -----------------------------------------------------------------------------
Fitch or Moody's or Standard & Poor's Percentage of Value
_______ ________ _________________ ___________________
AAA Aaa AAA 37.0%
AA Aa AA 21.2
A A A 11.8
BBB Baa BBB 18.2
Not Rated (d) Not Rated (d) Not Rated (d) 11.8
_______
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) Inverse floater security-the interest rate is subject to change
periodically.
(c) Security exempt from registration under Rule 144A of the Securities Act of
1933. This security may be resold in transactions exempt from registration,
normally to qualified institutional buyers. At October 31, 1998, this
security amounted to $2,487,818 or 3.5% of net assets.
(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.
(e) At October 31, 1998, 26.2% of the Fund's net assets are insured by MBIA.
(f) At October 31, 1998, the Fund had $19,864,697 (27.8% of net assets)
invested in securities whose payment of principal and interest is dependent
upon revenues generated from health care projects.
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
<PAGE>
<TABLE>
DREYFUS PREMIER STATE MUNICIPAL BOND FUND, MASSACHUSETTS SERIES
- -----------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES OCTOBER 31, 1998 (UNAUDITED)
Cost Value
____________ ___________
<S> <C> <C>
ASSETS: Investments in securities--See Statement of Investments . . $65,704,451 $70,199,423
Cash . . . . . . . . . . . . . . . . . . . . . . . . . . 254,079
Interest receivable . . . . . . . . . . . . . . . . . . . 1,071,164
Receivable for shares of Beneficial Interest subscribed . . 75,000
Prepaid expenses . . . . . . . . . . . . . . . . . . . . 6,921
____________
71,606,587
____________
LIABILITIES: Due to The Dreyfus Corporation and affiliates . . . . . . 33,623
Due to Distributor . . . . . . . . . . . . . . . . . . . 18,088
Accrued expenses . . . . . . . . . . . . . . . . . . . . 13,175
____________
64,886
____________
NET ASSETS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $71,541,701
____________
REPRESENTED BY: Paid-in capital . . . . . . . . . . . . . . . . . . . . . $65,951,254
Accumulated net realized gain (loss) on investments . . . 1,095,475
Accumulated net unrealized appreciation (depreciation)
on investments--Note 4 . . . . . . . . . . . . . . . . 4,494,972
____________
NET ASSETS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $71,541,701
____________
NET ASSET VALUE PER SHARE
_____________________________
Class A Class B Class C
____________ ____________ ____________
Net Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $64,174,325 $7,365,185 $2,191
Shares Outstanding . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,351,154 614,513 182.509
NET ASSET VALUE PER SHARE. . . . . . . . . . . . . . . . . . . . . . . . $11.99 $11.99 $12.00
_______ _______ _______
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
</TABLE>
<TABLE>
DREYFUS PREMIER STATE MUNICIPAL BOND FUND, MASSACHUSETTS SERIES
- -----------------------------------------------------------------------------
STATEMENT OF OPERATIONS SIX MONTHS ENDED OCTOBER 31, 1998 (UNAUDITED)
INVESTMENT INCOME
<S> <C> <C>
INCOME Interest Income . . . . . . . . . . . . . . . . . . . . . $2,033,660
EXPENSES: Management fee--Note 3(a) . . . . . . . . . . . . . . . . $ 187,242
Shareholder servicing costs--Note 3(c) . . . . . . . . . 108,008
Distribution fees--Note 3(b) . . . . . . . . . . . . . . 17,499
Professional fees . . . . . . . . . . . . . . . . . . . . 5,983
Prospectus and shareholders' reports . . . . . . . . . . 5,333
Registration fees . . . . . . . . . . . . . . . . . . . . 4,301
Custodian fees . . . . . . . . . . . . . . . . . . . . . 3,989
Trustees' fees and expenses--Note 3(d) . . . . . . . . . 415
Loan commitment fees--Note 2 . . . . . . . . . . . . . . 321
Miscellaneous . . . . . . . . . . . . . . . . . . . . . . 3,558
___________
Total Expenses . . . . . . . . . . . . . . . . . . . . 336,649
___________
INVESTMENT INCOME--NET . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,697,011
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS--Note 4:
Net realized gain (loss) on investments . . . . . . . . . $ 490,008
Net unrealized appreciation (depreciation) on investments . . 825,800
___________
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS . . . . . . . . . . . . . . . . . . 1,315,808
___________
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS . . . . . . . . . . . . . . . . . . . $3,012,819
___________
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
</TABLE>
<TABLE>
DREYFUS PREMIER STATE MUNICIPAL BOND FUND, MASSACHUSETTS 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 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 1,697,011 $ 3,608,186
Net realized gain (loss) on investments . . . . . . . . . . . . . . . . . . . . . . 490,008 881,735
Net unrealized appreciation (depreciation) on investments . . . . . . . . . . . . . 825,800 1,589,834
____________ ____________
Net Increase (Decrease) in Net Assets Resulting from Operations . . . . . . . . 3,012,819 6,079,755
____________ ____________
DIVIDENDS TO SHAREHOLDERS FROM:
Investment income--net:
Class A shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1,538,777) (3,315,280)
Class B shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (158,204) (292,854)
Class C shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (30) (52)
Net realized gain on investments:
Class A shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . -------- (259,927)
Class B shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . -------- (25,975)
Class C shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . -------- (5)
____________ ____________
Total Dividends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1,697,011) (3,894,093)
____________ ____________
BENEFICIAL INTEREST TRANSACTIONS:
Net proceeds from shares sold:
Class A shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,443,256 2,030,256
Class B shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 718,102 734,207
Class C shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,011 --------
Dividends reinvested:
Class A shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 898,460 2,065,722
Class B shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93,115 187,055
Class C shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . -------- 26
Cost of shares redeemed:
Class A shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (3,875,317) (11,381,019)
Class B shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (167,206) (581,316)
____________ ____________
Increase (Decrease) in Net Assets from Beneficial Interest Transactions . . . . 3,111,421 (6,945,069)
____________ ____________
Total Increase (Decrease) in Net Assets . . . . . . . . . . . . . . . . . . . 4,427,229 (4,759,407)
NET ASSETS:
Beginning of Period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67,114,472 71,873,879
____________ ____________
End of Period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $71,541,701 $67,114,472
____________ ____________
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
DREYFUS PREMIER STATE MUNICIPAL BOND FUND, MASSACHUSETTS SERIES
- -----------------------------------------------------------------------------
STATEMENT OF CHANGES IN NET ASSETS (CONTINUED)
Shares
_________________________________
Six Months Ended
October 31, 1998 Year Ended
CAPITAL SHARE TRANSACTIONS: (Unaudited) April 30, 1998
________________ ________________
Class A
________
Shares sold . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 450,845 173,993
Shares issued for dividends reinvested . . . . . . . . . . . . . . . . . . . . . . . 75,191 175,718
Shares redeemed . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (325,310) (970,437)
________ ________
Net Increase (Decrease) in Shares Outstanding . 200,726 (620,726)
________ ________
________ ________
Class B
________
Shares sold . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60,199 62,301
Shares issued for dividends reinvested . . . . . . . . . . . . . . . . . . . . . . . 7,797 15,921
Shares redeemed . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (14,064) (49,787)
________ ________
Net Increase (Decrease) in Shares Outstanding . 53,932 28,435
________ ________
Class C
________
Shares sold . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84 ------
Shares issued for dividends reinvested . . . . . . . . . . . . . . . . . . . . . . . ------ 2
________ ________
Net Increase (Decrease) in Shares Outstanding . 84 2
________ ________
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
</TABLE>
<TABLE>
DREYFUS PREMIER STATE MUNICIPAL BOND FUND, MASSACHUSETTS 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 . . . . . . $11.75 $11.40 $11.50 $11.53 $11.64 $12.13
_______ _______ _______ _______ _______ _______
Investment Operations:
Investment income--net . . . . . . . . . . . . . .30 .61 .63 .66 .69 .71
Net realized and unrealized gain (loss)
on investments . . . . . . . . . . . . . . . .24 .40 .17 -- (.06) (.44)
_______ _______ _______ _______ _______ _______
Total from Investment Operations . . . . . . . . .54 1.01 .80 .66 .63 .27
_______ _______ _______ _______ _______ _______
Distributions:
Dividends from investment income--net . . . . . . (.30) (.61) (.63) (.66) (.69) (.71)
Dividends from net realized gain on investments . . -- (.05) (.27) (.03) -- (.05)
Dividends in excess of net realized gain
on investments . . . . . . . . . . . . . . . -- -- -- -- (.05) --
_______ _______ _______ _______ _______ _______
Total Distributions . . . . . . . . . . . . . . . (.30) (.66) (.90) (.69) (.74) (.76)
_______ _______ _______ _______ _______ _______
Net asset value, end of period . . . . . . . . . $11.99 $11.75 $11.40 $11.50 $11.53 $11.64
_______ _______ _______ _______ _______ _______
TOTAL INVESTMENT RETURN(1) . . . . . . . . . . . . . 9.24%(2) 9.04% 7.08% 5.69% 5.72% 2.08%
RATIOS/SUPPLEMENTAL DATA:
Ratio of expenses to average net assets . . . . . .93%(2) .91% .92% .92% .94% .82%
Ratio of net investment income
to average net assets . . . . . . . . . . . . 5.04%(2) 5.23% 5.46% 5.57% 6.04% 5.80%
Decrease reflected in above expense ratios
due to undertakings by the Manager . . . . . -- -- -- -- .01% .11%
Portfolio Turnover Rate . . . . . . . . . . . . . 30.36%(3) 48.69% 24.45% 34.86% 13.62% 12.04%
Net Assets, end of period (000's Omitted) . . . . $64,174 $60,529 $65,809 $68,812 $72,731 $76,865
- -----------------------------
(1) Exclusive of sales load.
(2) Annualized.
(3) Not annualized.
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
DREYFUS PREMIER STATE MUNICIPAL BOND FUND, MASSACHUSETTS 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 B Shares
__________________________________________________________________
Six Months Ended
October 31, 1998 Year Ended April 30,
________________________________________________
PER SHARE DATA: (Unaudited) 1998 1997 1996 1995 1994
__________ _______ _______ _______ _______ _______
Net asset value, beginning of period . . . . . . $11.75 $11.40 $11.49 $11.52 $11.63 $12.13
_______ _______ _______ _______ _______ _______
Investment Operations:
Investment income--net . . . . . . . . . . . . . .27 .55 .57 .60 .63 .64
Net realized and unrealized gain (loss)
on investments . . . . . . . . . . . . . . . .24 .40 .18 -- (.06) (.45)
_______ _______ _______ _______ _______ _______
Total from Investment Operations . . . . . . . . .51 .95 .75 .60 .57 .19
_______ _______ _______ _______ _______ _______
Distributions:
Dividends from investment income--net . . . . . . (.27) (.55) (.57) (.60) (.63) (.64)
Dividends from net realized gain on investments . . -- (.05) (.27) (.03) -- (.05)
Dividends in excess of net realized gain
on investments . . . . . . . . . . . . . . . -- -- -- -- (.05) --
_______ _______ _______ _______ _______ _______
Total Distributions . . . . . . . . . . . . . . . (.27) (.60) (.84) (.63) (.68) (.69)
_______ _______ _______ _______ _______ _______
Net asset value, end of period . . . . . . . . . $11.99 $11.75 $11.40 $11.49 $11.52 $11.63
_______ _______ _______ _______ _______ _______
TOTAL INVESTMENT RETURN(1) . . . . . . . . . . . . . 8.53%(2) 8.49% 6.63% 5.15% 5.15% 1.44%
RATIOS/SUPPLEMENTAL DATA:
Ratio of expenses to average net assets . . . . . 1.44%(2) 1.42% 1.43% 1.43% 1.45% 1.36%
Ratio of net investment income
to average net assets . . . . . . . . . . . . 4.52%(2) 4.71% 4.94% 5.03% 5.47% 5.18%
Decrease reflected in above expense ratios
due to undertakings by the Manager . . . . . -- -- -- -- .01% .10%
Portfolio Turnover Rate . . . . . . . . . . . . . 30.36%(3) 48.69% 24.45% 34.86% 13.62% 12.04%
Net Assets, end of period (000's Omitted) . . . . $7,365 $6,584 $6,064 $5,255 $4,220 $3,702
- -----------------------------
(1) Exclusive of sales load.
(2) Annualized.
(3) Not annualized.
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
DREYFUS PREMIER STATE MUNICIPAL BOND FUND, MASSACHUSETTS 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 . . . . . . . . . . . $11.76 $11.41 $11.48 $11.59
______ ______ ______ ______
Investment Operations:
Investment income--net . . . . . . . . . . . . . . . . . . .26 .52 .54 .40
Net realized and unrealized gain (loss)
on investments . . . . . . . . . . . . . . . . . . . . .24 .40 .20 (.08)
______ ______ ______ ______
Total from Investment Operations . . . . . . . . . . . . . .50 .92 .74 .32
______ ______ ______ ______
Distributions:
Dividends from investment income--net . . . . . . . . . . . (.26) (.52) (.54) (.40)
Dividends from net realized gain on investments . . . . . . -- (.05) (.27) (.03)
______ ______ ______ ______
Total Distributions . . . . . . . . . . . . . . . . . . . . (.26) (.57) (.81) (.43)
______ ______ ______ ______
Net asset value, end of period . . . . . . . . . . . . . . $12.00 $11.76 $11.41 $11.48
______ ______ ______ ______
TOTAL INVESTMENT RETURN(2) . . . . . . . . . . . . . . . . . . 8.45%(3) 8.22% 6.55% 3.76%(3)
RATIOS/SUPPLEMENTAL DATA:
Ratio of expenses to average net assets . . . . . . . . . . 1.68%(3) 1.64% 1.65% 1.69%(3)
Ratio of net investment income
to average net assets . . . . . . . . . . . . . . . . . 4.25%(3) 4.51% 4.64% 4.72%(3)
Portfolio Turnover Rate . . . . . . . . . . . . . . . . . . 30.36%(4) 48.69% 24.45% 34.86%
Net Assets, end of period (000's Omitted) . . . . . . . . . $2 $1 $1 $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.
<PAGE>
</TABLE>
DREYFUS PREMIER STATE MUNICIPAL BOND FUND, MASSACHUSETTS 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 Massachusetts 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 assumptions. 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 $1,881 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.
<PAGE>
DREYFUS PREMIER STATE MUNICIPAL BOND FUND, MASSACHUSETTS 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, if any, 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 (the "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.
(B) Under the Distribution Plan adopted pursuant to Rule 12b-1 under the Act,
Class B and Class C shares pay the Distributor for distributing their 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 $17,494 and $5, respectively, pursuant to the Distribution
Plan.
(C) Under the Shareholder Services Plan, Class A, Class B and Class C shares
pay the Distributor at an annual rate of .25 of 1% of the value of the average
daily net assets 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 $76,361, $8,747 and $2, respectively, pursuant to the
Shareholder Services Plan.
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 $14,371 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.
<PAGE>
DREYFUS PREMIER STATE MUNICIPAL BOND FUND, MASSACHUSETTS SERIES
- -----------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
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 $24,257,269 and $19,888,248, respectively.
At October 31, 1998, accumulated net unrealized appreciation on investment was
$4,494,972, consisting of $4,585,023 gross unrealized appreciation and $90,051
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).
<PAGE>
DREYFUS PREMIER STATE MUNICIPAL
BOND FUND, MASSACHUSETTS 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 DISTRIBUTION AGENT
Dreyfus Transfer, Inc.
P.O. Box 9671
Providence, RI 02940
Printed in U.S.A. 063/622SA9810
SEMI-ANNUAL REPORT
- -------------------------------------------------------------------------------
DREYFUS PREMIER STATE
MUNICIPAL BOND FUND
MASSACHUSETTS SERIES
- -------------------------------------------------------------------------------
OCTOBER 31, 1998
<PAGE>
