<PAGE>
SELIGMAN ADVISORS, INC.
an affiliate of
[LOGO]
J. & W. SELIGMAN & CO.
INCORPORATED
ESTABLISHED 1864
www.seligman.com
This report is intended only for the information of shareholders or those who
have received the offering prospectus covering shares of Capital Stock of
Seligman New Jersey Municipal Fund, Inc., which contains information about the
sales charges, management fee, and other costs. Please read the prospectus
carefully before investing or sending money.
TECNJ2 9/00
SELIGMAN
--------------------
NEW JERSEY
MUNICIPAL FUND, INC.
ANNUAL REPORT
SEPTEMBER 30, 2000
-------
Providing Income
Exempt From Regular
Income Tax
<PAGE>
TO THE SHAREHOLDERS
The year ended September 30, 2000 was an increasingly positive one for
fixed-income securities. The beginning of 2000 saw a climate of rising interest
rates and uncertainty about the US economy's direction. As the year progressed,
however, general economic trends and the law of supply and demand -- lower
issuances and higher investor demand -- converged to create a more favorable
environment for bonds overall and municipal bonds specifically. These factors
were reflected in the strong performance of Seligman New Jersey Municipal Fund,
which returned 5.13% during this period based on the net asset value of Class A
shares.
By June of this year it was apparent that the Federal Reserve Board's efforts to
slow the economy to a more sustainable pace were having an effect. Leading
economic indicators such as new home sales, manufacturing, corporate earnings,
and retail sales all pointed to an economy that is still strong, but whose
growth has slowed. The Fed responded to these signs by leaving interest rates
untouched in June, August, and October of this year.
Despite the slowing, the Fed indicated that inflation is still a concern going
forward because of high oil prices, the continued tight labor market, and the
fact that consumer spending still outpaces personal income. Nonetheless, because
of the presidential election and given the economic slowdown, we don't
anticipate further rate hikes in 2000, although they can't be ruled out at some
point in 2001.
Against this backdrop of stabilizing interest rates, both Treasuries and
municipal bonds have benefited from an environment of shrinking supply and
increased demand. The Treasury Department's debt buyback program, initiated in
January 2000, has reduced the supply of Treasuries. In the case of municipal
bonds, the strong economy has increased government tax revenues, and many cities
and states have therefore issued fewer bonds for the purpose of raising funds.
Moreover, higher interest rates have made it more costly for municipalities to
borrow money, further reducing the pool of available municipal bonds. These two
factors should work in conjunction to restrain new issue supply, thus increasing
the possibility of rising market prices for issued municipal bonds.
At the same time, inflation fears and earnings warnings caused great volatility
in the stock market this year, prompting some investors to seek greater
stability in fixed-income securities. If recent stock market volatility
continues and if market returns remain lackluster, there will be further
increased demand for the tax-free returns and the diversifying effect of munis.
We appreciate your confidence in Seligman New Jersey Municipal Fund and look
forward to serving your investment needs for many years to come. A discussion
with your Portfolio Manager, as well as the Fund's portfolio of investments,
financial statements, and performance history, follows this letter.
By order of the Board of Directors,
/s/ William C. Morris
William C. Morris
Chairman
/s/ Brian T. Zino
Brian T. Zino
President
November 10, 2000
1
<PAGE>
INTERVIEW WITH YOUR PORTFOLIO MANAGER,
THOMAS G. MOLES
Q: What economic and market factors have influenced Seligman New Jersey
Municipal Fund during the past twelve months?
A: Throughout the period, the direction of the municipal bond market was
influenced by a combination of factors, including the state of the economy,
supply and demand dynamics, and the planned reduction in US Treasury debt
issuance. At this time last year, long-term yields were trending higher in
response to a strengthening economy. By the start of the new year, it
appeared that the pace of growth was moderating, and long-term municipal
yields began a long-awaited decline, supported by a slowdown in municipal new
issue supply. However, the rally would prove premature as the economy, once
again, surprised financial markets with its resilience, sending bond yields
sharply higher. It would take another round of tightening by the Federal
Reserve Board in May to reverse the bond market decline and to restore
investor confidence. For the remainder of the Fund's fiscal year, municipal
market sentiment was optimistic, which contributed to the positive
performance of the market and of the Fund.
Municipal new issue supply declined during the year due mostly to a
significant reduction in refunding volume. The higher cost of borrowing
prevented many issuers from retiring outstanding, higher-coupon debt through
the issuance of refunding bonds. The lack of supply helped to stabilize the
market during periods of rising interest rates.
In January 2000, the US Treasury Department announced its proposal to
eliminate the national debt by 2013 through a reduction in future issuance
and the buyback of outstanding Treasury issues. This decision had
wide-ranging implications, not the least of which was the impact on the
Treasury yield curve. As the supply of the benchmark 30-year Treasury bond
began to contract, the yield curve inverted, and the 30-year Treasury yield
fell below the 10-year yield. While the municipal yield curve remained
positively sloped during the period, it was nevertheless influenced by the
behavior of the Treasury curve, and the spread between short-term and
long-term municipal yields narrowed significantly. This flattening, together
with the overall decline in interest rates, caused long-term municipal bonds,
which comprise the
A TEAM APPROACH
Seligman New Jersey Municipal Fund is managed by the Seligman Municipals
Team, headed by Thomas G. Moles. Mr. Moles is assisted in the management of
the Fund by a group of seasoned professionals who are responsible for
research and trading consistent with the Fund's investment objective.
[PICTURE]
Seligman Municipals Team: (standing, from left) Audrey Kuchtyak, Debra
McGuinness, (seated, from left) Eileen Comerford, Theresa Barion, Thomas G.
Moles (Portfolio Manager)
2
<PAGE>
INTERVIEW WITH YOUR PORTFOLIO MANAGER,
THOMAS G. MOLES
majority of the Fund, to significantly outperform short- and
intermediate-term municipal bonds.
The unprecedented prosperity of the past decade has improved the financial
status of the nation's states, cities, and municipalities. Credit rating
upgrades have exceeded downgrades by a wide margin in recent years, a trend
that is expected to continue. Further, the companies that insure municipal
bonds have seen their profit picture improve as a result of more conservative
underwriting policies, as well as an expansion into new, and often more
lucrative, markets. Seligman New Jersey Municipal Fund has a significant
percentage of insured bonds in its portfolio. The creditworthiness of these
holdings is enhanced by a strengthening municipal insurance industry.
Q: What was your strategy?
A: During the past year, periods of rising interest rates negatively impacted
net asset values of the Fund. As a result, Seligman New Jersey Municipal Fund
experienced an increase in redemptions which necessitated the selling of
portfolio holdings. Given our positive long-term outlook for the municipal
market, we opted to reduce holdings of defensive securities in order to
better position the Fund to benefit from an expected future decline in
interest rates. Purchases were concentrated in long-term bonds because they
continue to offer the highest yields and provide the greatest potential for
price appreciation during periods of declining interest rates. (Conversely,
when interest rates rise, long-term bonds will depreciate more in price than
shorter maturity bonds.) This strategy caused the Fund to underperform the
market while rates were still climbing, but contributed to the competitive
investment performance reported for the Fund's fiscal year.
The Fund remains diversified among the various sectors of the municipal
market. While we seek opportunities in all sectors, we increased our focus in
the health care sector, which has been experiencing financial difficulties
due primarily to a reduction in government reimbursements and the growth of
managed care. Many hospitals have been downgraded by the municipal rating
agencies and remain vulnerable to further credit deterioration. However,
there are still many well-managed, financially secure hospitals that are
trading at attractive levels because of the negative outlook for the industry
as a whole. Through in-depth credit analysis, we identified opportunities and
have selectively purchased health care bonds. During the past year, fund
holdings in the strong-performing transportation sector were increased
significantly. Housing bond positions were also boosted due to the higher
yields available in this sector. Our seasoned municipal team continually
monitors all portfolio holdings to ensure that they meet our credit criteria.
Q: What is your outlook?
A: The Fed voted to leave policy unchanged at its October meeting, a move widely
anticipated by the financial markets. The decision was motivated by growing
evidence of a slowdown in the pace of US economic growth. Further,
productivity improvements continue to contain labor costs despite the lowest
unemployment rate in over 30 years. However, the Fed stressed its intention
to remain vigilant for signs of a buildup in inflationary pressures given
prevailing tight labor markets and the more recent uptick in energy costs.
Until the Fed has declared a victory in the war on inflation, interest rates
will likely fluctuate in response to the latest economic reports. Any upward
movement in long-term interest rates should continue to be tempered by the
supply contraction in the Treasury and municipal markets. Investment
performance for Seligman New Jersey Municipal Fund's fiscal year has been
positive, and we remain hopeful that the year 2000 will end on a positive
note as well.
3
<PAGE>
PERFORMANCE OVERVIEW AND PORTFOLIO SUMMARY
This chart compares a $10,000 hypothetical investment made in Seligman New
Jersey Municipal Fund Class A shares with and without the initial 4.75% maximum
sales charge, and assumes that all distributions within the period are invested
in additional shares, for the 10-year period ended September 30, 2000, to a
$10,000 hypothetical investment made in the Lehman Brothers Municipal Bond Index
(Lehman Index) for the same period. The performances of Seligman New Jersey
Municipal Fund Class C and Class D shares are not shown in this chart but are
included in the table on page 5. It is important to keep in mind that the Lehman
Index does not include any fees or sales charges and does not reflect
state-specific bond market performance. The table on page 5 also includes
relevant portfolio characteristics. Past performance is not indicative of future
investment results.
SELIGMAN NEW JERSEY MUNICIPAL FUND CLASS A
VALUE
-------------------
With Without
DATE Load Load Lehman
----------------------------------------------
30-Sep-90 9,524 10,000 10,000
31-Dec-90 10,046 10,548 10,431
31-Mar-91 10,254 10,766 10,667
30-Jun-91 10,468 10,990 10,894
30-Sep-91 10,855 11,397 11,318
31-Dec-91 11,155 11,712 11,698
31-Mar-92 11,139 11,696 11,733
30-Jun-92 11,636 12,217 12,179
30-Sep-92 11,908 12,502 12,502
31-Dec-92 12,157 12,764 12,729
31-Mar-93 12,626 13,257 13,201
30-Jun-93 13,121 13,776 13,633
30-Sep-93 13,577 14,255 14,094
31-Dec-93 13,662 14,344 14,291
31-Mar-94 12,892 13,536 13,507
30-Jun-94 12,968 13,615 13,657
30-Sep-94 13,001 13,650 13,749
31-Dec-94 12,821 13,461 13,551
31-Mar-95 13,690 14,374 14,510
30-Jun-95 13,960 14,657 14,859
30-Sep-95 14,271 14,983 15,287
31-Dec-95 14,817 15,557 15,917
31-Mar-96 14,560 15,287 15,724
30-Jun-96 14,710 15,444 15,846
30-Sep-96 15,037 15,787 16,210
31-Dec-96 15,321 16,085 16,623
31-Mar-97 15,238 15,999 16,585
30-Jun-97 15,724 16,509 17,157
30-Sep-97 16,233 17,044 17,675
31-Dec-97 16,689 17,522 18,154
31-Mar-98 16,857 17,698 18,363
30-Jun-98 17,141 17,996 18,642
30-Sep-98 17,673 18,555 19,215
31-Dec-98 17,691 18,575 19,330
31-Mar-99 17,809 18,698 19,502
30-Jun-99 17,485 18,358 19,157
30-Sep-99 17,134 17,990 19,080
31-Dec-99 16,705 17,539 18,931
31-Mar-00 17,326 18,191 19,486
30-Jun-00 17,571 18,448 19,780
30-Sep-00 18,014 18,913 20,259
The performances of Class C and Class D shares will be greater than or less
than the performance shown for Class A shares, based on the differences in sales
charges and fees paid by shareholders.
Performance data quoted represent changes in prices and assume that all
distributions within the period are invested in additional shares. The rates of
return will vary and the principal value of an investment will fluctuate.
Shares, if redeemed, may be worth more or less than their original cost.
4
<PAGE>
PERFORMANCE OVERVIEW AND PORTFOLIO SUMMARY
Investment Results Per Share
<TABLE>
<CAPTION>
TOTAL RETURNS
For Periods Ended September 30, 2000
AVERAGE ANNUAL
---------------------------------------------------
CLASS C CLASS D
SINCE SINCE
SIX ONE FIVE 10 INCEPTION INCEPTION
MONTHS* YEAR YEARS YEARS 5/27/99 2/1/94
-------- ------- ------ ------- --------- ----------
<S> <C> <C> <C> <C> <C> <C>
Class A**
With Sales Charge (0.97)% 0.08% 3.75% 6.06% n/a n/a
Without Sales Charge 3.97 5.13 4.77 6.58 n/a n/a
Class C**
With Sales Charge and CDSC 1.56 2.21 n/a n/a (1.17)% n/a
Without Sales Charge and CDSC 3.56 4.20 n/a n/a 0.31 n/a
Class D**
With 1% CDSC 2.56 3.20 n/a n/a n/a n/a
Without CDSC 3.56 4.20 3.97 n/a n/a 3.40%
Lehman Index*** 3.97 6.18 5.79 7.32 3.16+ 5.20++
</TABLE>
<TABLE>
<CAPTION>
NET ASSET VALUE DIVIDEND, CAPITAL GAIN, AND YIELD INFORMATION
For Periods Ended September 30, 2000
9/30/00 3/31/00 9/30/99 DIVIDENDS o CAPITAL GAIN o SEC YIELD oo
-------- -------- -------- ---------- ------------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
Class A $7.12 $7.01 $7.13 Class A $0.328 $0.032 4.42%
Class C 7.20 7.09 7.22 Class C 0.278 0.032 3.89
Class D 7.20 7.09 7.22 Class D 0.278 0.032 3.93
</TABLE>
<TABLE>
<CAPTION>
HOLDINGS BY MARKET SECTOR++ MOODY'S/S&P RATINGS++
<S> <C> <C> <C>
Revenue Bonds 90% Aaa/AAA 46%
General Obligation Bonds 10 Aa/AA 15
WEIGHTED AVERAGE MATURITY 25.9 years A/A 29
Baa/BBB 10
</TABLE>
------------------
*Returns for periods of less than one year are not annualized.
**Return figures reflect any change in price and assume all distributions
within the period are invested in additional shares. Returns for Class A
shares are calculated with and without the effect of the initial 4.75%
maximum sales charge. Returns for Class C shares are calculated with and
without the effect of the initial 1% maximum sales charge and the 1%
contingent deferred sales charge ("CDSC") that is charged on redemptions made
within 18 months of the date of purchase. Returns for Class D shares are
calculated with and without the effect of the 1% CDSC, charged on redemptions
made within one year of the date of purchase. A portion of the Fund's income
may be subject to applicable state and local taxes, and any amount may be
subject to the federal alternative minimum tax.
***The Lehman Index is an unmanaged index that does not include any fees or
sales charges. It is composed of approximately 60% revenue bonds and 40%
state government obligations. Investors cannot invest directly in an index.
+From 5/31/99.
++From 1/31/94.
oRepresents per share amount paid or declared for the year ended September 30,
2000.
ooCurrent yield, representing the annualized yield for the 30-day period ended
September 30, 2000, has been computed in accordance with SEC regulations and
will vary.
++Percentages based on market values of long-term holdings at September 30,
2000.
5
<PAGE>
PORTFOLIO OF INVESTMENTS
September 30, 2000
<TABLE>
<CAPTION>
FACE RATINGS+ MARKET
AMOUNT MUNICIPAL BONDS MOODY'S/S&P VALUE
---------- ------------------- ----------- -----------
<S> <C> <C> <C>
$2,000,000 Delaware River & Bay Authority Rev., 5 3/4% due 1/1/2029 .......... Aaa/AAA $2,036,300
2,000,000 Howell Township, NJ GOs, 6.80% due 1/1/2014........................ Aaa/AAA 2,086,660
2,500,000 Middletown, NJ Board of Education School GOs, 5.80% due 8/1/2019 .. Aaa/AAA 2,555,775
2,000,000 New Jersey Economic Development Authority Rev. (The Trustees of the
Lawrenceville School Project), 5 3/4% due 7/1/2016 .............. Aa2/NR 2,046,240
3,000,000 New Jersey Economic Development Authority Gas Facilities Rev.
(NUI Corporation Project), 5.70% due 6/l/2032* .................. Aaa/AAA 2,951,340
2,900,000 New Jersey Economic Development Authority Sewage Facilities Rev.
(Anheuser-Busch Project), 5.85% due 12/l/2030* .................. A1/A+ 2,932,190
1,000,000 New Jersey Economic Development Authority Water Facilities Rev.
(Middlesex Water Co. Project), 5.20% due 10/1/2022 .............. Aaa/AAA 948,780
3,000,000 New Jersey Economic Development Authority Water Facilities Rev.
(New Jersey American Water Co., Inc.), 5 3/8% due 5/1/2032* ..... Aaa/AAA 2,831,430
3,000,000 New Jersey Educational Facilities Financing Authority Rev.
(Institute for Advanced Study), 5% due 7/l/2021 ................. Aaa/AA+ 2,787,420
2,255,000 New Jersey Health Care Facilities Financing Authority Rev.
(Meridian Health System Obligated Group), 5 3/8% due 7/1/2024.... Aaa/AAA 2,171,407
3,000,000 New Jersey Health Care Facilities Financing Authority Rev.
(Holy Name Hospital), 6% due 7/1/2025............................ NR/BBB+ 2,626,890
1,000,000 New Jersey Health Care Facilities Financing Authority Rev.
(The Medical Center at Princeton), 5% due 7/1/2028 .............. Aaa/AAA 896,900
2,450,000 New Jersey Health Care Facilities Financing Authority Rev.
(Hackensack University Medical Center), 6% due 1/1/2034 ......... A3/NR 2,415,014
2,500,000 New Jersey Highway Authority (Garden State Parkway Senior Parkway
Rev.), 5 5/8% due 1/1/2030....................................... A1/AA- 2,500,800
1,500,000 New Jersey Housing & Mortgage Finance Agency (Home Buyer Rev.),
6% due 10/1/2021*................................................ Aaa/AAA 1,524,945
750,000 New Jersey Housing & Mortgage Finance Agency (Multi-Family Housing
Rev.), 5 3/4% due 5/1/2025....................................... Aaa/AAA 757,230
930,000 New Jersey Housing & Mortgage Finance Agency (Home Buyer Rev.),
5.90% due 10/1/2029*............................................. Aaa/AAA 933,078
</TABLE>
------------------
+ Ratings have not been audited by Deloitte & Touche LLP.
* Interest income earned from this security is subject to the federal
alternative minimum tax.
See notes to financial statements.
6
<PAGE>
PORTFOLIO OF INVESTMENTS
September 30, 2000
<TABLE>
<CAPTION>
FACE RATINGS+ MARKET
AMOUNT MUNICIPAL BONDS MOODY'S/S&P VALUE
---------- ------------------- ----------- -----------
<S> <C> <C> <C>
$1,500,000 New Jersey Housing & Mortgage Finance Agency (Multi-Family
Housing Rev.), 6.35% due 11/1/2031*............................... Aaa/AAA $1,543,800
3,000,000 Port Authority of New York & New Jersey Consolidated Rev.,
5 3/4% due 6/15/2030.............................................. A1/AA- 3,026,280
2,000,000 Puerto Rico Highway & Transportation Authority Rev., 5 1/2% due
7/1/2036.......................................................... Baa1/A 1,965,420
2,300,000 Rutgers State University, NJ, 5.20% due 5/1/2027.................... A1/AA 2,155,330
1,000,000 Salem County, NJ Improvement Authority Rev. (Correctional Facility &
Courthouse Annex), 5.70% due 5/1/2017............................. Aaa/AAA 1,009,250
2,500,000 Salem County, NJ Pollution Control Financing Authority Waste Disposal
Rev. (E.I. duPont de Nemours & Co.), 6 1/8% due 7/15/2022* ....... Aa3/AA- 2,549,175
1,250,000 South Jersey Port Corporation, NJ Marine Terminal Rev., 5.60% due
1/1/2023.......................................................... NR/A+ 1,218,850
-----------
TOTAL MUNICIPAL BONDS (Cost $48,507,532) -- 100.4% ........................................ 48,470,504
OTHER ASSETS LESS LIABILITIES -- (0.4)% ................................................... (216,449)
-----------
NET ASSETS -- 100.0% ...................................................................... $48,254,055
===========
</TABLE>
------------------
+ Ratings have not been audited by Deloitte & Touche LLP.
* Interest income earned from this security is subject to the federal
alternative minimum tax.
See notes to financial statements.
7
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES
September 30, 2000
ASSETS:
Investments, at value:
Long-term holdings (Cost $48,507,532) ..................... $48,470,504
Cash ........................................................ 37,690
Interest receivable ......................................... 873,555
Receivable for Capital Stock sold ........................... 80,331
Receivable for securities sold .............................. 70,000
Expenses prepaid to shareholder service agent ............... 5,014
Other ....................................................... 816
-----------
Total Assets ................................................ 49,537,910
-----------
LIABILITIES:
Loan payable ................................................ 1,050,000
Dividends payable ........................................... 72,288
Payable for Capital Stock repurchased ....................... 27,800
Accrued expenses and other .................................. 133,767
-----------
Total Liabilities ........................................... 1,283,855
-----------
Net Assets .................................................. $48,254,055
===========
COMPOSITION OF NET ASSETS:
Capital Stock, at par ($.001 par value; 100,000,000 shares
authorized; 6,777,414 shares outstanding):
Class A ................................................... $ 6,592
Class C ................................................... 47
Class D ................................................... 138
Additional paid-in capital .................................. 48,081,696
Undistributed net realized gain ............................. 202,610
Net unrealized depreciation of investments .................. (37,028)
-----------
Net Assets .................................................. $48,254,055
===========
NET ASSET VALUE PER SHARE:
Class A ($46,917,792 / 6,591,807 shares) .................... $7.12
=====
Class C ($341,203 / 47,400 shares) .......................... $7.20
=====
Class D ($995,060 / 138,207 shares) ......................... $7.20
=====
------------------
See notes to financial statements.
8
<PAGE>
STATEMENT OF OPERATIONS
For the Year Ended September 30, 2000
INVESTMENT INCOME:
Interest ..................................................... $2,953,486
EXPENSES:
Management fee .................................... $ 253,332
Distribution and service fees ..................... 137,112
Shareholder account services ...................... 80,053
Auditing and legal fees ........................... 40,852
Shareholder reports and communications ............ 20,407
Custody and related services ...................... 18,056
Registration ...................................... 13,231
Directors' fees and expenses ...................... 10,633
Miscellaneous ..................................... 2,052
---------
Total Expenses ............................................... 575,728
----------
Net Investment Income ........................................ 2,377,758
NET REALIZED AND UNREALIZED
GAIN (LOSS) ON INVESTMENTS:
Net realized gain on investments ................... 209,558
Net change in unrealized appreciation of investments (183,459)
--------
Net Gain on Investments ...................................... 26,099
----------
Increase in Net Assets from Operations ....................... $2,403,857
==========
------------------
See notes to financial statements.
9
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
YEAR ENDED SEPTEMBER 30,
------------------------
OPERATIONS: 2000 1999
---------- -----------
<S> <C> <C>
Net investment income ....................................... $2,377,758 $2,585,327
Net realized gain on investments ............................ 209,558 257,481
Net change in unrealized appreciation of investments ........ (183,459) (4,555,415)
----------- -----------
Increase (Decrease) in Net Assets from Operations............ 2,403,857 (1,712,607)
----------- -----------
DISTRIBUTIONS TO SHAREHOLDERS:
Net investment income:
Class A ................................................... (2,325,739) (2,521,489)
Class C ................................................... (9,084) (947)
Class D ................................................... (42,935) (62,891)
Net realized gain on investments:
Class A ................................................... (239,878) (744,909)
Class C ................................................... (793) --
Class D ................................................... (6,216) (21,499)
----------- -----------
Decrease in Net Assets from Distributions.................... (2,624,645) (3,351,735)
----------- -----------
</TABLE>
<TABLE>
<CAPTION>
SHARES
------------------------
YEAR ENDED SEPTEMBER 30,
------------------------
CAPITAL SHARE TRANSACTIONS:* 2000 1999
-------- ---------
<S> <C> <C> <C> <C>
Net proceeds from sales of shares:
Class A ............................. 366,910 196,843 2,560,329 1,478,334
Class C ............................. 33,431 17,577 237,666 130,877
Class D ............................. 19,262 36,898 135,837 282,964
Shares issued in payment of dividends:
Class A ............................. 168,634 188,091 1,174,358 1,411,854
Class C ............................. 1,072 75 7,558 549
Class D ............................. 3,085 4,681 21,739 35,612
Exchanged from associated Funds:
Class A ............................. 780,029 993,398 5,362,917 7,441,980
Class C ............................. -- -- -- --
Class D ............................. 6,106 36,753 43,016 286,110
Shares issued in payment of gain
distributions:
Class A ............................. 23,538 70,420 165,005 535,893
Class C ............................. 112 -- 793 --
Class D ............................. 757 2,248 5,373 17,285
---------- ---------- ----------- ------------
Total.................................. 1,402,936 1,546,984 9,714,591 11,621,458
---------- ---------- ----------- ------------
Cost of shares repurchased:
Class A ............................. (1,487,926) (968,501) (10,347,811) (7,276,733)
Class C ............................. (2,120) -- (15,007) --
Class D ............................. (82,902) (67,008) (579,630) (505,987)
Exchanged into associated Funds:
Class A ............................. (687,113) (992,358) (4,787,928) (7,426,285)
Class C ............................. (2,747) -- (20,000) --
Class D ............................. (22,874) -- (158,373) --
---------- ---------- ----------- ------------
Total.................................. (2,285,682) (2,027,867) (15,908,749) (15,209,005)
---------- ---------- ----------- ------------
Decrease in Net Assets from Capital
Share Transactions................... (882,746) (480,883) (6,194,158) (3,587,547)
========== ========== =========== ============
Decrease in Net Assets......................................... (6,414,946) (8,651,889)
NET ASSETS:
Beginning of year.............................................. 54,669,001 63,320,890
----------- ------------
End of Year.................................................... $48,254,055 $54,669,001
============ ===========
</TABLE>
------------------
* The Fund began offering Class C shares on May 27, 1999.
See notes to financial statements.
10
<PAGE>
NOTES TO FINANCIAL STATEMENTS
1. Multiple Classes of Shares -- Seligman New Jersey Municipal Fund, Inc. (the
"Fund") offers three classes of shares. Class A shares are sold with an initial
sales charge of up to 4.75% and a continuing service fee of up to 0.25% on an
annual basis. Class A shares purchased in an amount of $1,000,000 or more are
sold without an initial sales charge but are subject to a contingent deferred
sales charge ("CDSC") of 1% on redemptions within 18 months of purchase. The
Fund began offering Class C shares on May 27, 1999. Class C shares are sold with
an initial sales charge of up to 1% and are subject to a distribution fee of up
to 0.75% and a service fee of up to 0.25% on an annual basis, and a CDSC, if
applicable, of 1% imposed on redemptions made within 18 months of purchase.
Class D shares are sold without an initial sales charge but are subject to a
distribution fee of up to 0.75% and a service fee of up to 0.25% on an annual
basis, and a CDSC, if applicable, of 1% imposed on redemptions made within one
year of purchase. The three classes of shares represent interests in the same
portfolio of investments, have the same rights, and are generally identical in
all respects except that each class bears its separate distribution and certain
other class-specific expenses, and has exclusive voting rights with respect to
any matter on which a separate vote of any class is required.
2. Significant Accounting Policies -- The financial statements have been
prepared in conformity with accounting principles generally accepted in the
United States of America, which require management to make certain estimates and
assumptions at the date of the financial statements. The following summarizes
the significant accounting policies of the Fund:
a. Security Valuation --All municipal securities and other short-term holdings
maturing in more than 60 days are valued based upon quotations provided by
an independent pricing service or, in their absence, at fair value determined
in accordance with procedures approved by the Board of Directors. Short-term
holdings maturing in 60 days or less are generally valued at amortized cost.
b. Federal Taxes -- There is no provision for federal income tax. The Fund has
elected to be taxed as a regulated investment company and intends to
distribute substantially all taxable net income and net gain realized.
c. Security Transactions and Related Investment Income -- Investment
transactions are recorded on trade dates. Identified cost of investments sold
is used for both financial statement and federal income tax purposes.
Interest income is recorded on the accrual basis. The Fund amortizes original
issue discounts and premiums paid on purchases of portfolio securities.
Discounts other than original issue discounts are not amortized.
d. Multiple Class Allocations -- All income, expenses (other than class-specific
expenses), and realized and unrealized gains or losses are allocated daily to
each class of shares based upon the relative value of the shares of each
class. Class-specific expenses, which include distribution and service fees
and any other items that are specifically attributable to a particular class,
are charged directly to such class. For the year ended September 30, 2000,
distribution and service fees were the only class-specific expenses.
e. Distributions to Shareholders -- Dividends are declared daily and paid
monthly. Other distributions paid by the Fund are recorded on the ex-dividend
date. The treatment for financial statement purposes of distributions made to
shareholders during the year from net investment income or net realized gains
may differ from their ultimate treatment for federal income tax purposes.
These differences are caused primarily by differences in the timing of the
recognition of certain components of income, expense, or realized capital
gain for federal income tax purposes. Where such differences are permanent in
nature, they are reclassified in the components of net assets based on their
ultimate characterization for federal income tax purposes. Any such
reclassifications will have no effect on net assets,
11
<PAGE>
NOTES TO FINANCIAL STATEMENTS
results of operations or net asset values per share of
the Fund.
3. Purchases and Sales of Securities -- Purchases and sales of portfolio
securities, excluding short-term investments, for the year ended September 30,
2000, amounted to $8,984,289 and $13,865,654, respectively.
At September 30, 2000, the cost of investments for federal income tax purposes
was substantially the same as the cost for financial reporting purposes, and the
tax basis gross unrealized appreciation and depreciation of investments amounted
to $828,491 and $865,519, respectively.
4. Management Fee, Distribution Services, and Other Transactions -- J. & W.
Seligman & Co. Incorporated (the "Manager") manages the affairs of the Fund and
provides the necessary personnel and facilities. Compensation of all officers of
the Fund, all directors of the Fund who are employees or consultants of the
Manager, and all personnel of the Fund and the Manager, is paid by the Manager.
The Manager's fee, calculated daily and payable monthly, is equal to 0.50% per
annum of the Fund's average daily net assets.
Seligman Advisors, Inc. (the "Distributor"), agent for the distribution of the
Fund's shares and an affiliate of the Manager, received concessions of $3,988
for sales of Class A shares. Commissions of $29,933 and $2,586 were paid to
dealers for sales of Class A and Class C shares, respectively.
The Fund has an Administration, Shareholder Services and Distribution Plan
(the "Plan") with respect to distribution of its shares. Under the Plan, with
respect to Class A shares, service organizations can enter into agreements with
the Distributor and receive a continuing fee of up to 0.25% on an annual basis,
payable quarterly, of the average daily net assets of the Class A shares
attributable to the particular service organizations for providing personal
services and/or the maintenance of shareholder accounts. The Distributor charges
such fees to the Fund pursuant to the Plan. For the year ended September 30,
2000, fees incurred aggregated $123,839, or 0.25% per annum of the average daily
net assets of Class A shares.
Under the Plan, with respect to Class C and Class D shares, service
organizations can enter into agreements with the Distributor and receive a
continuing fee for providing personal services and/or the maintenance of
shareholder accounts of up to 0.25% on an annual basis of the average daily net
assets of the Class C and Class D shares for which the organizations are
responsible, and fees for providing other distribution assistance of up to 0.75%
on an annual basis of such average daily net assets. Such fees are paid monthly
by the Fund to the Distributor pursuant to the Plan. For the year ended
September 30, 2000, fees incurred under the Plan amounted to $2,329 and $10,944,
for Class C and Class D shares, respectively, which is equivalent to 1% per
annum of the average daily net assets of each class.
The Distributor is entitled to retain any CDSC imposed on certain redemptions
of Class A and Class C shares occurring within 18 months of purchase and on
redemptions of Class D shares occurring within one year of purchase. For the
year ended September 30, 2000, such charges amounted to $347.
Seligman Services, Inc., an affiliate of the Manager, is eligible to
receive commissions from certain sales of shares of the Fund, as well as
distribution and service fees pursuant to the Plan. For the year ended
September 30, 2000, Seligman Services, Inc. received commissions of $408 from
the sale of shares of the Fund. Seligman Services, Inc. also received
distribution and service fees of $10,475, pursuant to the Plan.
Seligman Data Corp., which is owned by certain associated investment
companies, charged at cost $80,053 for shareholder account services.
Certain officers and directors of the Fund are
officers or directors of the Manager, the Distributor, Seligman Services,
Inc., and/or Seligman Data Corp.
12
<PAGE>
NOTES TO FINANCIAL STATEMENTS
The Fund has a compensation arrangement under which directors who receive fees
may elect to defer receiving such fees. Directors may elect to have their
deferred fees accrue interest or earn a return based on the performance of the
Fund or other funds in the Seligman Group of Investment Companies. The cost of
such fees and earnings accrued thereon is included in directors' fees and
expenses, and the accumulated balance thereof at September 30, 2000, of $40,686
is included in other liabilities. Deferred fees and related accrued earnings are
not deductible for federal income tax purposes until such amounts are paid.
5. Committed Line of Credit -- The Fund is a participant in a joint $825 million
committed line of credit that is shared by substantially all open-end funds in
the Seligman Group of Investment Companies. The Fund's borrowings are limited to
10% of its net assets. Borrowings pursuant to the credit facility are subject to
interest at a per annum rate equal to the overnight federal funds rate plus
0.50%. The Fund incurs a commitment fee of 0.10% per annum on its share of the
unused portion of the credit facility. The credit facility may be drawn upon
only for temporary purposes and is subject to certain other customary
restrictions. The credit facility commitment expires in June 2001, but is
renewable annually with the consent of the participating banks.
On September 29, 2000, the Fund borrowed $1,050,000 from the credit facility
at an interest rate of 7.25%. The entire loan was repaid on October 11, 2000.
There were no other borrowings during the year ended September 30, 2000.
13
<PAGE>
FINANCIAL HIGHLIGHTS
The tables below are intended to help you understand each Class's financial
performance for the past five years or from its inception if less than five
years. Certain information reflects financial results for a single share of a
Class that was held throughout the periods shown. Per share amounts are
calculated using average shares outstanding during the period. "Total return"
shows the rate that you would have earned (or lost) on an investment in each
Class, assuming you reinvested all your dividend and capital gain distributions.
Total returns do not reflect any sales charges and are not annualized for
periods of less than one year.
<TABLE>
<CAPTION>
CLASS A CLASS C
--------------------------------------------- ----------------
YEAR ENDED SEPTEMBER 30, YEAR 5/27/99*
--------------------------------------------- ENDED TO
2000 1999 1998 1997 1996 9/30/00 9/30/99
----- ----- ----- ----- ----- ------- -------
PER SHARE DATA:
<S> <C> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period ............. $7.13 $7.78 $7.56 $7.60 $7.59 $7.22 $7.58
----- ----- ----- ----- ----- ----- -----
Income from Investment Operations:
Net investment income ............................ 0.33 0.33 0.35 0.36 0.39 0.28 0.09
Net realized and unrealized investment gain (loss)
on investments ................................. 0.02 (0.55) 0.30 0.21 0.01 0.01 (0.36)
----- ----- ----- ----- ----- ----- -----
Total from Investment Operations ................. 0.35 (0.22) 0.65 0.57 0.40 0.29 (0.27)
----- ----- ----- ----- ----- ----- -----
Less Distributions:
Dividends from net investment income ............. (0.33) (0.33) (0.35) (0.36) (0.39) (0.28) (0.09)
Distributions from net realized capital gain ..... (0.03) (0.10) (0.08) (0.25) -- (0.03) --
----- ----- ----- ----- ----- ----- -----
Total Distributions .............................. (0.36) (0.43) (0.43) (0.61) (0.39) (0.31) (0.09)
----- ----- ----- ----- ----- ----- -----
Net Asset Value, End of Period.................... $7.12 $7.13 $7.78 $7.56 $7.60 $7.20 $7.22
===== ===== ===== ===== ===== ===== =====
TOTAL RETURN: 5.13% (3.05)% 8.87% 7.96% 5.37% 4.20% 3.33)%
RATIOS/SUPPLEMENTAL DATA:
Net Assets, end of period (000s omitted) ......... $46,918 $52,992 $61,739 $62,597 $66,293 $341 $127
Ratio of expenses to average net assets .......... 1.12% 1.07% 1.02% 1.06% 1.02% 1.87% 1.82%+
Ratio of net income to average net assets ........ 4.71% 4.35% 4.54% 4.90% 5.06% 3.96% 3.71%+
Portfolio turnover rate .......................... 18.08% 5.55% 23.37% 20.22% 25.65% 18.08% 5.55%++
</TABLE>
------------------
See footnotes on page 15.
14
<PAGE>
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
CLASS D
---------------------------------------------
YEAR ENDED SEPTEMBER 30,
---------------------------------------------
2000 1999 1998 1997 1996
----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C>
PER SHARE DATA:
Net Asset Value, Beginning of Year ............... $7.22 $7.86 $7.64 $7.68 $7.67
----- ----- ----- ----- -----
Income from Investment Operations:
Net investment income ............................ 0.28 0.27 0.29 0.31 0.33
Net realized and unrealized gain (loss)
on investments ................................. 0.01 (0.54) 0.30 0.21 0.01
----- ----- ----- ----- -----
Total from Investment Operations ................. 0.29 (0.27) 0.59 0.52 0.34
----- ----- ----- ----- -----
Less Distributions:
Dividends from net investment income ............. (0.28) (0.27) (0.29) (0.31) (0.33)
Distributions from net gain realized ............. (0.03) (0.10) (0.08) (0.25) --
----- ----- ----- ----- -----
Total Distributions .............................. (0.31) (0.37) (0.37) (0.56) (0.33)
----- ----- ----- ----- -----
Net Asset Value, End of Year ..................... $7.20 $7.22 $7.86 $7.64 $7.68
===== ===== ===== ===== =====
TOTAL RETURN: 4.20% (3.57)% 7.97% 7.10% 4.56%
RATIOS/SUPPLEMENTAL DATA:
Net Assets, end of year (000s omitted) ........... $995 $1,550 $1,582 $1,282 $1,152
Ratio of expenses to average net assets .......... 1.87% 1.82% 1.80% 1.83% 1.79%
Ratio of net income to average net assets 3.96% 3.60% 3.76% 4.13% 4.29%
Portfolio turnover rate........................... 18.08% 5.55% 23.37% 20.22% 25.65%
</TABLE>
------------------
* Commencement of offering of Class C shares.
+ Annualized.
++ For the year ended September 30, 1999.
See notes to financial statements.
15
<PAGE>
REPORT OF INDEPENDENT AUDITORS
The Board of Directors and Shareholders,
Seligman New Jersey Municipal Fund, Inc.:
We have audited the accompanying statement of assets and liabilities, including
the portfolio of investments, of Seligman New Jersey Municipal Fund, Inc. as of
September 30, 2000, and the related statements of operations for the year then
ended and of changes in net assets for each of the two years in the period then
ended, and the financial highlights for each of the periods presented. These
financial statements and financial highlights are the responsibility of the
Fund's management. Our responsibility is to express an opinion on these
financial statements and financial highlights based on our audits.
We conducted our audits in accordance with auditing standards generally accepted
in the United States of America. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements and financial highlights are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. Our procedures included confirmation
of securities owned as of September 30, 2000, by correspondence with the Fund's
custodian. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide reasonable
basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of
Seligman New Jersey Municipal Fund, Inc. as of September 30, 2000, the results
of its operations for the year then ended and the changes in its net assets and
the financial highlights for the respective stated periods, in conformity with
accounting principles generally accepted in the United States of America.
DELOITTE & TOUCHE LLP
New York, New York
November 10, 2000
16
<PAGE>
BOARD OF DIRECTORS
John R. Galvin 2, 4
Director, Raytheon Company
Dean Emeritus, Fletcher School of Law and Diplomacy
at Tufts University
Alice S. Ilchman 3, 4
Trustee, Committee for Economic Development
Chairman, The Rockefeller Foundation
Frank A. McPherson 2, 4
Director, Kimberly-Clark Corporation
Director, Baptist Medical Center
Director, Conoco Inc.
John E. Merow 2, 4
Director, Commonwealth Industries, Inc.
Trustee, New York-Presbyterian Hospital
Retired Chairman and Senior Partner,
Sullivan & Cromwell, Law Firm
Betsy S. Michel 2, 4
Trustee, The Geraldine R. Dodge Foundation
William C. Morris 1
Chairman
Chairman of the Board,
J. & W. Seligman & Co. Incorporated
Chairman, Carbo Ceramics Inc.
Director, Kerr-McGee Corporation
James C. Pitney 3, 4
Retired Partner, Pitney, Hardin, Kipp & Szuch, Law Firm
Leroy C. Richie 4
Chairman & CEO, Q Standards Worldwide, Inc.
James Q. Riordan 3, 4
Director, KeySpan Energy Corporation
Trustee, Committee for Economic Development
Richard R. Schmaltz 1
Managing Director, Director of Investments,
J. & W. Seligman & Co. Incorporated
Trustee Emeritus, Colby College
Robert L. Shafer 3, 4
Retired Vice President, Pfizer Inc.
James N. Whitson 2, 4
Director and Consultant, Sammons Enterprises, Inc.
Director, C-SPAN
Director, CommScope, Inc.
Brian T. Zino 1
President
President, J. & W. Seligman & Co. Incorporated
Chairman, Seligman Data Corp.
Director, ICI Mutual Insurance Company
Member of the Board of Governors,
Investment Company Institute
Fred E. Brown
Director Emeritus
----------------
Member: 1 Executive Committee
2 Audit Committee
3 Director Nominating Committee
4 Board Operations Committee
17
<PAGE>
EXECUTIVE OFFICERS
William C. Morris
Chairman
Brian T. Zino
President
Thomas G. Moles
Vice President
Lawrence P. Vogel
Vice President and Treasurer
Frank J. Nasta
Secretary
FOR MORE INFORMATION
Manager
J. & W. Seligman & Co. Incorporated
100 Park Avenue
New York, NY 10017
General Counsel
Sullivan & Cromwell
Independent Auditors
Deloitte & Touche LLP
General Distributor
Seligman Advisors, Inc.
100 Park Avenue
New York, NY 10017
Shareholder Service Agent
Seligman Data Corp.
100 Park Avenue
New York, NY 10017
Important Telephone Numbers
(800) 221-2450 Shareholder Services
(212) 682-7600 Outside the
United States
(800) 622-4597 24-Hour
Automated
Telephone Access
Service
18
<PAGE>
GLOSSARY OF FINANCIAL TERMS
Capital Gain Distribution -- A payment to mutual fund shareholders of profits
realized on the sale of securities in the fund's portfolio.
Capital Appreciation/Depreciation -- An increase or decrease in the market value
of a mutual fund's portfolio securities, which is reflected in the net asset
value of the fund's shares. Capital appreciation/depreciation of an individual
security is in relation to the original purchase price.
Compounding -- The change in the value of an investment as shareholders receive
earnings on their investment's earnings. For example, if $1,000 is invested at a
fixed rate of 7% a year, the initial investment is worth $1,070 after one year.
If the return is compounded, second year earnings will not be based on the
original $1,000, but on the $1,070, which includes the first year's earnings.
Contingent Deferred Sales Charge (CDSC) -- Depending on the class of shares
owned, a fee charged by a mutual fund when shares are sold back to the fund. The
CDSC expires after a fixed time period.
Dividend -- A payment by a mutual fund, usually derived from the fund's net
investment income (dividends and interest less expenses).
Dividend Yield -- A measurement of a fund's dividend as a percentage of the
maximum offering price or net asset value.
Expense Ratio -- The cost of doing business for a mutual fund, expressed as a
percent of the fund's net assets.
Investment Objective -- The shared investment goal of a fund and its
shareholders.
Management Fee -- The amount paid by a mutual fund to its investment advisor(s).
Multiple Classes of Shares -- Although an individual mutual fund invests in only
one portfolio of securities, it may offer investors several purchase options
which are "classes" of shares. Multiple classes permit shareholders to choose
the fee structure that best meets their needs and goals. Generally, each class
will differ in terms of how and when sales charges and certain fees are
assessed.
National Association of Securities Dealers, Inc. (NASD) -- A self-regulatory
body with authority over firms that distribute mutual funds.
Net Asset Value (NAV) Per Share -- The market worth of one fund share, obtained
by adding a mutual fund's total assets (securities, cash, and any accrued
earnings), subtracting liabilities, and dividing the resulting net assets by the
number of shares outstanding.
Offering Price -- The price at which a mutual fund's share can be purchased. The
offering price is the current net asset value per share plus any sales charge.
Portfolio Turnover -- A measure of the trading activity in a mutual fund's
investment portfolio that reflects how often securities are bought and sold.
Prospectus -- The legal document describing a mutual fund to all prospective
shareholders. It contains information required by the Securities and Exchange
Commission (SEC), such as the fund's investment objective and policies,
services, investment restrictions, how shares are bought and sold, fund fees and
other charges, and the fund's financial highlights.
SEC Yield -- SEC Yield refers to the net income earned by a fund during a recent
30-day period. This income is annualized and then divided by the maximum
offering price per share on the last day of the 30-day period. The SEC Yield
formula reflects semiannual compounding.
Securities and Exchange Commission -- The primary US federal agency that
regulates the registration and distribution of mutual fund shares. Statement of
Additional Information -- A document that contains more detailed information
about an investment company and that supplements the prospectus. It is available
at no charge upon request.
Total Return -- A measure of fund performance encompassing all elements of
return. Reflects the change in share price over a given period and assumes all
distributions are taken in additional fund shares. The Average Annual Total
Return represents the average annual compounded rate of return for the periods
presented.
Yield on Securities -- For bonds, the current yield is the coupon rate of
interest, divided by the purchase price. For stocks, the yield is measured by
dividing dividends paid by the maximum offering price of the stock.
----------------
Adapted from the Investment Company Institute's 2000 Mutual Fund Fact Book.
19
