File No. 33-14294
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [ X ]
Pre-Effective Amendment No. [ ]
Post-Effective Amendment No. 13 [ X ]
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 [ X ]
Amendment No. 13 [ X ]
(Check appropriate box or boxes.)
DREYFUS NEW YORK TAX EXEMPT MONEY MARKET FUND
(Exact Name of Registrant as Specified in Charter)
c/o The Dreyfus Corporation
200 Park Avenue, New York, New York 10166
(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, including Area Code: (212) 922-6000
Daniel C. Maclean III, Esq.
200 Park Avenue
New York, New York 10166
(Name and Address of Agent for Service)
It is proposed that this filing will become effective (check appropriate
box)
immediately upon filing pursuant to paragraph (b)
----
X on September 1, 1995 pursuant to paragraph (b)
----
60 days after filing pursuant to paragraph (a)(i)
----
on (date) pursuant to paragraph (a)(i)
----
75 days after filing pursuant to paragraph (a)(ii)
----
on (date) pursuant to paragraph (a)(ii) of Rule 485
----
If appropriate, check the following box:
this post-effective amendment designates a new effective date for
a previously filed post-effective amendment.
----
Registrant has registered an indefinite number of shares of its common
stock under the Securities Act of 1933 pursuant to Section 24(f) of the
Investment Company Act of 1940. Registrant's Rule 24f-2 Notice for the
fiscal year ended May 31, 1995 was filed on or about July 17, 1995.
DREYFUS NEW YORK TAX EXEMPT MONEY MARKET FUND
Cross-Reference Sheet Pursuant to Rule 495(a)
Items in
Part A of
Form N-1A Caption Page
_________ _______ ____
1 Cover Page Cover
2 Synopsis 3
3 Condensed Financial Information 3
4 General Description of Registrant 6
5 Management of the Fund 18
5(a) Management's Discussion of Fund's Performance *
6 Capital Stock and Other Securities 27, 29
7 Purchase of Securities Being Offered 19
8 Redemption or Repurchase 24
9 Pending Legal Proceedings *
Items in
Part B of
Form N-1A
- ---------
10 Cover Page Cover
11 Table of Contents Cover
12 General Information and History *
13 Investment Objectives and Policies B-2
14 Management of the Fund B-12
15 Control Persons and Principal B-14
Holders of Securities
16 Investment Advisory and Other B-17
Services
_____________________________________
NOTE: * Omitted since answer is negative or inapplicable.
DREYFUS NEW YORK TAX EXEMPT MONEY MARKET FUND
Cross-Reference Sheet Pursuant to Rule 495(a) (continued)
Items in
Part B of
Form N-1A Caption Page
_________ _______ _____
17 Brokerage Allocation B-27
18 Capital Stock and Other Securities B-25
19 Purchase, Redemption and Pricing B-18, B-20
of Securities Being Offered B-25
20 Tax Status *
21 Underwriters B-18
22 Calculations of Performance Data B-28
23 Financial Statements B-54
Items in
Part C of
Form N-1A
_________
24 Financial Statements and Exhibits C-1
25 Persons Controlled by or Under C-3
Common Control with Registrant
26 Number of Holders of Securities C-3
27 Indemnification C-3
28 Business and Other Connections of C-4
Investment Adviser
29 Principal Underwriters C-11
30 Location of Accounts and Records C-14
31 Management Services C-14
32 Undertakings C-14
_____________________________________
NOTE: * Omitted since answer is negative or inapplicable.
_____________________________________________________________________________
COMBINED PROSPECTUS SEPTEMBER 1, 1995
DREYFUS NEW YORK TAX EXEMPT FUNDS
_____________________________________________________________________________
OVERVIEW
Each of Dreyfus New York Tax Exempt Money Market Fund, Dreyfus New
York Tax Exempt Intermediate Bond Fund and Dreyfus New York Tax Exempt Bond
Fund, Inc. (each, a "Fund" and collectively, the "Funds") is an open-end,
non-diversified, management investment company, known as a mutual fund. The
goal of each Fund is to provide you with as high a level of current income
exempt from Federal, New York State and New York City income taxes as is
consistent with the preservation of capital and, for the money market fund
only, the maintenance of liquidity. Each Fund pursues its objective by
investing in a portfolio of New York Municipal Obligations. The Funds differ
in average portfolio maturity and quality, which in turn affects their level
of income and degree of share price fluctuation.
DREYFUS NEW YORK TAX EXEMPT MONEY MARKET FUND (the "MONEY MARKET FUND") is a
money market fund that seeks to maintain a stable share price of $1.00. AN
INVESTMENT IN THE MONEY MARKET FUND iS NEITHER INSURED NOR GUARANTEED BY THE
U.S. GOVERNMENT. THERE CAN BE NO ASSURANCE THAT THE MONEY MARKET FUND WILL BE
ABLE TO MAINTAIN A STABLE NET ASSET VALUE OF $1.00 PER SHARE.
DREYFUS NEW YORK TAX EXEMPT INTERMEDIATE BOND FUND (the "INTERMEDIATE BOND
FUND") seeks to provide you with a higher level of tax-free income than the
Money Market Fund, and greater price stability than the Bond Fund. The
dollar-weighted average maturity of its portfolio ranges between three and
ten years.
DREYFUS NEW YORK TAX EXEMPT BOND FUND, INC. (the "BOND FUND") seeks to
provide you with a higher level of tax-free income than the Intermediate Bond
Fund. Its price per share should be expected to fluctuate more than the
Intermediate Bond Fund's price per share. Its portfolio investments are not
limited by maturity.
EACH FUND IS A SEPARATE ENTITY WITH A SEPARATE PORTFOLIO. THE
OPERATIONS AND RESULTS OF ONE FUND ARE UNRELATED TO THOSE OF EACH OTHER FUND.
THIS COMBINED PROSPECTUS HAS BEEN PREPARED FOR YOUR CONVENIENCE TO PROVIDE
YOU THE OPPORTUNITY TO CONSIDER THREE INVESTMENT CHOICES IN ONE DOCUMENT.
You can invest, reinvest or redeem shares at any time without charge
or penalty imposed by your Fund.
Each Fund provides free redemption checks, which you can use in
amounts of $500 or more for cash or to pay bills. You continue to earn income
on the amount of the check until it clears. You can purchase or redeem shares
by telephone using Dreyfus TELETRANSFER.
The Dreyfus Corporation professionally manages each Fund's portfolio.
The INTERMEDIATE BOND FUND bears certain costs of advertising,
administration and/or distribution pursuant to a separate plan adopted in
accordance with Rule 12b-1 under the Investment Company Act of 1940, and the
BOND FUND and the MONEY MARKET FUND bear certain allocated expenses for
shareholder servicing pursuant to separate plans.
This Prospectus sets forth concisely information about each Fund that
you should know before investing. It should be read and retained for future
reference.
The Statement of Additional Information, dated September 1, 1995,
which may be revised from time to time, provides a further discussion of
certain areas in this Prospectus and other matters which may be of interest
to some investors. It has been filed with the Securities and Exchange
Commission and is incorporated herein by reference. For a free copy, write to
one of the Funds at 144 Glenn Curtiss Boulevard, Uniondale, New York
11556-0144, or call 1-800-645-6561. When telephoning, ask for Operator 144.
MUTUAL FUND SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED
OR ENDORSED BY, ANY BANK, AND ARE NOT FEDERALLY INSURED BY THE FEDERAL
DEPOSIT INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD, OR ANY OTHER
AGENCY. THE NET ASSET VALUE OF BOND MUTUAL FUNDS WILL FLUCTUATE FROM TIME TO
TIME.
_______________________________________________________________________________
TABLE OF CONTENTS
Page Page
Annual Fund Operating Expenses....3 Shareholder Services.................22
Condensed Financial Information...3 How to Redeem Shares.................25
Performance Information...........5 Service Plan and Shareholder
Description of the Funds..........6 Services Plans.......................27
Management of the Funds...........19 Dividends, Distributions and Taxes...28
How to Buy Shares.................20 General Information..................30
_______________________________________________________________________________
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.
_______________________________________________________________________________
(This Page Intentionally Left Blank)
Page 2
<TABLE>
<CAPTION>
ANNUAL FUND OPERATING EXPENSES
(as a percentage of average daily net assets)
Money Interm.
Market Bond Bond
Fund Fund Fund
_________ ___________ _________
<S> <C> <C> <C> <C> <C>
Management Fees......................................................... .50% .60% .60%
12b-1 Fees(distribution and servicing).................................. None .25% None
Other Expenses ......................................................... .18% .11% .12%
Total Fund Operating Expenses........................................... .68% .96% .72%
EXAMPLE:
You would pay the following expenses on a $1,000 investment in each Fund,
assuming (1) 5% annual return and (2) redemption at the end of each
period:
1 YEAR 3 YEARS 5 YEARS 10 YEARS
MONEY MARKET FUND $ 7 $ 22 $ 38 $ 85
INTERMEDIATE BOND FUND $ 10 $ 31 $ 53 $ 118
BOND FUND $ 7 $ 23 $ 40 $ 89
</TABLE>
_______________________________________________________________________________
THE AMOUNTS LISTED IN THE EXAMPLE SHOULD NOT BE CONSIDERED AS REPRESEN-
TATIVE OF PAST OR FUTURE EXPENSES AND ACTUAL EXPENSES MAY BE GREATER OR LESS
THAN THOSE INDICATED. MOREOVER, WHILE THE EXAMPLE ASSUMES A 5% ANNUAL RETURN,
EACH FUND'S ACTUAL PERFORMANCE WILL VARY AND MAY RESULT IN AN ACTUAL RETURN
GREATER OR LESS THAN 5%.
_______________________________________________________________________________
The purpose of the foregoing table is to assist you in understanding
the costs and expenses borne by a Fund, and therefore indirectly by
investors, the payment of which will reduce investors' annual returns.
Long-term investors in the INTERMEDIATE BOND FUND could pay more in 12b-1
fees than the economic equivalent of paying a front-end sales charge. The
information in the foregoing table does not reflect any fee waivers or
expense reimbursement arrangements that may be in effect. Certain Service
Agents (as defined below) may charge their clients directly for effecting
transactions in Fund shares; such fees are not reflected in the foregoing
table. See "Management of the Funds" and, as applicable, "Service Plan and
Shareholder Services Plans."
CONDENSED FINANCIAL INFORMATION
The information in the following tables has been audited by Ernst &
Young LLP, each Fund's independent auditors, whose reports thereon appear in
the Statement of Additional Information. Further financial data and related
notes are included in the Statement of Additional Information, available upon
request.
Page 3
FINANCIAL HIGHLIGHTS
MONEY MARKET FUND _ 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 year
indicated. This information has been derived from the MONEY MARKET FUND'S
financial statements.
<TABLE>
<CAPTION>
Year Ended May 31,
__________________________________________________________________
1988(1) 1989 1990 1991 1992 1993 1994 1995
________ _______ _______ ______ _______ ______ ______ ______
<S> <C> <C> <C> <C> <C> <C> <C> <C>
PER SHARE DATA:
Net asset value, beginning of year $1.0000 $1.0002 $1.0001 $.9999 $.9999 $.9999 $1.0000 $.9999
________ _______ _______ ______ _______ ______ ______ ______
INVESTMENT OPERATIONS:
Investment income-net............ .0421 .0498 .0522 .0458 .0321 .0186 .0168 .0273
Net realized and unrealized gain (loss) on investments .0002 (.0001) (.0002) __ __ .0001 (.0001 (.0001)
________ _______ _______ ______ _______ ______ ______ ______
TOTAL FROM INVESTMENT OPERATIONS .0423 .0497 .0520 .0458 .0321 .0187 .0167 .0272
________ _______ _______ ______ _______ ______ ______ ______
DISTRIBUTIONS:
Dividends from investment income-net (.0421) (.0498) (.0522) (.0458) (.0321)(.0186) (.0168)(.0273)
________ _______ _______ ______ _______ ______ ______ _____
Net asset value, end of year..... $1.0002 $1.0001 $.9999 $.9999 $.9999 $1.0000 $.9999 $.9998
======== ======= ======= ====== ====== ======= ====== ======
TOTALINVESTMENTRETURN 4.38%(2) 5.10% 5.35% 4.68% 3.26% 1.87% 1.69% 2.76%
RATIOS / SUPPLEMENTALDATA:
Ratio of expenses to average net assets .24%(2) .58% .64% .61% .64% .67% .68% .68%
Ratio of net investment income to average net assets 4.32%(2) 5.00% 5.21% 4.59% 3.22% 1.86% 1.68% 2.71%
Decrease reflected in above expense ratios due to
undertakings by The Dreyfus Corporation .43%(2) .03% __ __ __ __ __ __
Net Assets, end of year (000's omitted) $385,931 $444,491 $539,47 $478,040 $418,763 $379,816 $343,964$317,840
(1)From June 9, 1987 (commencement of operations) to
May 31, 1988.
(2)Annualized basis.
</TABLE>
FINANCIAL HIGHLIGHTS
INTERMEDIATE BOND FUND _ 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 year indicated. This information has
been derived from the INTERMEDIATE BOND FUND'S financial
statements.
<TABLE>
<CAPTION>
Year Ended May 31,
_________________________________________________________________
1988(1) 1989 1990 1991 1992 1993 1994 1995
PER SHARE DATA: ________ _______ ______ _______ ______ ______ ______ _____
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of year $16.50 $16.19 $16.53 $16.41 $16.73 $17.22 $18.06 $17.71
________ _______ _______ ______ _______ ______ ______ _____
INVESTMENT OPERATIONS:
Investment income-net............ 1.02 1.10 1.11 1.07 1.01 .94 .88 .86
Net realized and unrealized gain (loss) on investments (.31) .34 (.12) .38 .57 .94 (.31) .34
________ _______ _______ ______ _______ ______ ______ _____
TOTAL FROM INVESTMENT OPERATIONS .71 1.44 .99 1.45 1.58 1.88 .57 1.20
________ _______ _______ ______ _______ ______ ______ _____
DISTRIBUTIONS:
Dividends from investment income-net (1.02) (1.10) (1.11) (1.07) (1.01) (.93) (.89)(.86)
Dividends from net realized gain on investments __ __ __ (.06) (.08) (.11) (.03) __
________ _______ _______ ______ _______ ______ _______ ____
TOTAL DISTRIBUTIONS.............. (1.02) (1.10) (1.11) (1.13) (1.09) (1.04) (.92)(.86)
________ _______ _______ ______ _______ ______ _______ ____
Net asset value, end of year..... $16.19 $16.53 $16.41 $16.73 $17.22 $18.06 $17.71$18.05
======== ======= ======= ====== ======= ====== ====== =====
TOTAL INVESTMENT RETURN 4.63%(2) 9.25% 6.19% 9.13% 9.72% 11.22% 3.11% 7.04%
RATIOS / SUPPLEMENTALDATA:
Ratio of expenses to average net assets __ .24% .30% .60% .85% .85% .89% .96%
Ratio of net investment income to average net assets 6.58%(2) 6.80% 6.75% 6.48% 5.95% 5.25% 4.81% 4.91%
Decrease reflected in above expense ratios due to
undertakings by The Dreyfus Corporation (limited to
the expense limitation provision of the
Management Agreement) 1.50%(2) 1.10% .84% .44% .18% .15% .08% __
Portfolio Turnover Rate.......... 1.47%(3) 6.99% 37.97% 56.43% 28.51% 17.05% 20.19% 29.78%
Net Assets, end of year (000's omitted) $25,073 $57,918 $93,572 $112,868 $173,835 $318,139 $392,143 $359,199
(1)From June 12, 1987 (commencement of operations) to
May 31, 1988.
(2)Annualized basis.
(3)Not annualized.
</TABLE>
PAGE 4
FINANCIAL HIGHLIGHTS
BOND FUND _ Contained below is per share operating
performance data for a share of common stock outstanding, total
investment return, ratios to average net assets and other
supplemental data for each year indicated. This information has
been derived from the BOND FUND'S financial statements.
<TABLE>
<CAPTION>
Year Ended May 31,
_____________________________________________________________________________
1986 1987 1988 1989 1990 1991 1992 1993 1994 1995
PER SHARE DATA: ______ _______ _______ _______ _______ _______ _______ _______ ______ ______
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of year $14.10 $15.05 $14.73 $14.41 $14.92 $14.65 $14.89 $15.36 $16.06 $15.06
______ _______ _______ _______ _______ _______ _______ _______ ______ ______
INVESTMENT OPERATIONS:
Investment income-net.. 1.15 1.10 1.08 1.08 1.06 1.04 1.01 .95 .88 .84
Net realized and unrealized gain
(loss) on investments.. .95 (.32) (.32) .51 (.27) .24 .47 .92 (.62) .23
______ _______ _______ _______ _______ _______ _______ _______ ______ ______
TOTAL FROM INVESTMENT
OPERATIONS............. 2.10 .78 .76 1.59 .79 1.28 1.48 1.87 .26 1.07
______ _______ _______ _______ _______ _______ _______ _______ ______ ______
DISTRIBUTIONS:
Dividends from investment income-net (1.15) (1.10) (1.08) (1.08) (1.06) (1.04) (1.01) (.95) (.89) (.84)
Dividends from net realized
gain on investments.... __ __ __ __ __ __ __ (.22) (.37) (.08)
Dividends in excess of net realized
gain on investments.... __ __ __ __ __ __ __ __ __ (.02)
______ _______ _______ _______ _______ _______ _______ _______ ______ ______
TOTAL DISTRIBUTIONS.... (1.15) (1.10) (1.08) (1.08) (1.06) (1.04) (1.01) (1.17) (1.26) (.94)
______ _______ _______ _______ _______ _______ _______ _______ ______ ______
Net asset value, end of year $15.05 $14.73 $14.41 $14.92 $14.65 $14.89 $15.36 $16.06 $15.06 $15.19
====== ======= ======= ======= ======= ======= ======= ====== ======= ======
TOTALINVESTMENTRETURN 15.34% 4.99% 5.44% 11.39% 5.43% 9.06% 10.23% 12.63% 1.42% 7.55%
RATIOS / SUPPLEMENTALDATA:
Ratio of expenses to average net assets .71% .71% .72% .69% .70% .70% .69% .70%. .71% .72%
Ratio of net investment income to
average net assets..... 7.83% 7.04% 7.41% 7.34% 7.12% 7.08% 6.69% 6.03% 5.49% 5.70%
Portfolio Turnover Rate 14.84% 37.54% 56.96% 37.83% 31.22% 26.19% 40.05% 51.20% 35.66% 49.03%
Net Assets, end of year (000's omitted)
$1,245,440$1,537,449$1,463,109$1,643,808$1,681,206$1,752,334$1,897,988$2,098,253$1,941,233$1,879,197
</TABLE>
INTERMEDIATE BOND FUND AND BOND FUND ONLY _ Further information about the
performance of each of the INTERMEDIATE BOND FUND and BOND FUND (collectively,
the "LONGER TERM FUNDS") is contained in such Fund's respective annual report,
each of which may be obtained without charge by writing to the address or
calling the number set forth on the cover page of this Prospectus.
PERFORMANCE INFORMATION
MONEY MARKET FUND _ From time to time, the MONEY MARKET FUND advertises its
yield and effective yield. Both yield figures are based on historical
earnings and are not intended to indicate future performance. It can be
expected that these yields will fluctuate substantially. The yield of the
MONEY MARKET FUND refers to the income generated by an investment in the Fund
over a seven-day period (which period will be stated in the advertisement).
This income is then annualized. That is, the amount of income generated by
the investment during that week is assumed to be generated each week over a
52-week period and is shown as a percentage of the investment. The effective
yield is calculated similarly, but, when annualized, the income earned by an
investment in the Fund is assumed to be reinvested. The effective yield will
be slightly higher than the yield because of the compounding effect of this
assumed reinvestment. The Fund's yield and effective yield may reflect
absorbed expenses pursuant to any undertakings that may be in effect. See
"Management of the Funds."
Tax equivalent yield is calculated by determining the pre-tax yield
which, after being taxed at a stated rate, would be equivalent to a stated
current yield as described above.
Yield information is useful in reviewing the MONEY MARKET FUND'S
performance, but because yields will fluctuate, under certain conditions such
information may not provide a basis for comparison
PAGE 5
with domestic bank deposits, other investments which pay a fixed yield for a
stated period of time, or other investment companies which may use a different
method of computing yield.
Comparative performance information may be used from time to time in
advertising or marketing the Fund's shares, including data from Lipper
Analytical Services, Inc., Bank Rate Monitortrademark, N. Palm Beach, Fla.
33408, IBC/Donoghue's Money Fund ReportRegistration Mark, Morningstar, Inc.
and other industry publications.
INTERMEDIATE BOND FUND AND BOND FUND _ For purposes of advertising,
performance of the LONGER TERM FUNDS may be calculated on several bases,
including current yield, tax equivalent yield, average annual total return
and/or total return.
Current yield of a LONGER TERM FUND refers to its annualized net
investment income per share over a 30-day period, expressed as a percentage
of the net asset value per share at the end of the period. For purposes of
calculating current yield, the amount of net investment income per share
during that 30-day period, computed in accordance with regulatory require-
ments, is compounded by assuming it is reinvested at a constant rate over a
six-month period. An identical result is then assumed to have occurred during
a second six-month period which, when added to the result for the first six
months, provides an "annualized" yield for an entire one-year period. Calcula-
tions of a LONGER TERM FUND'S current yield may reflect absorbed expenses
pursuant to any undertakings that may be in effect. See "Management of the
Funds."
Tax equivalent yield is also calculated by determining the pre-tax
yield which, after being taxed at a stated rate, would be equivalent to a
stated current yield calculated as described above.
Average annual total return for each LONGER TERM FUND is calculated
pursuant to a standardized formula which assumes that an investment in such
Fund was purchased with an initial payment of $1,000 and that the investment
was redeemed at the end of a stated period of time, after giving effect to
the reinvestment of dividends and distributions during the period. The return
is expressed as a percentage rate which, if applied on a compounded annual
basis, would result in the redeemable value of the investment at the end of
the period. Advertisements of a LONGER TERM FUND'S performance will include
its average annual total return for one, five and ten year periods, or for
shorter time periods depending upon the length of time during which it has
operated.
Total return is computed on a per share basis and assumes the
reinvestment of dividends and distributions. Total return generally is
expressed as a percentage rate which is calculated by combining the income
and principal changes for a specified period and dividing by the net asset
value per share at the beginning of the period. Advertisements may include
the percentage rate of total return or may include the value of a
hypothetical investment at the end of the period which assumes the
application of the percentage rate of total return.
Comparative performance information may be used from time to time in
advertising or marketing shares of the LONGER TERM FUNDS, including data from
CDA Investment Technologies, Inc., Lipper Analytical Services, Inc., Moody's
Bond Survey Bond Index, Lehman Brothers Municipal Bond Index, Morningstar,
Inc. and other industry publications.
ALL FUNDS _ Performance will vary from time to time and past results are not
necessarily representative of future results. You should remember that
performance is a function of portfolio management in selecting the type and
quality of portfolio securities and is affected by operating expenses.
Performance information, such as that described above, may not provide a
basis for comparison with other investments or other investment companies
using a different method of calculating performance.
DESCRIPTION OF THE FUNDS
INVESTMENT OBJECTIVE
The goal of each of the Funds is to provide you with as high a level
of current income exempt from Federal, New York State and New York City
income taxes as is consistent with the preservation of capital and, for the
MONEY MARKET FUND only, the maintenance of liquidity. To accomplish this goal,
each
Page 6
Fund invests primarily in the debt securities of the State of New York,
its political subdivisions, authorities and corporations, the interest from
which is, in the opinion of bond counsel to the issuer, exempt from Federal,
New York State and New York City income taxes (collectively, "New York
Municipal Obligations"). To the extent acceptable New York Municipal
Obligations are at any time unavailable for investment by any Fund, such Fund
will invest temporarily in other debt securities the interest from which is,
in the opinion of bond counsel to the issuer, exempt from Federal, but not
New York State and New York City, income tax. The MONEY MARKET FUND invests
primarily in high-quality, short-term instruments. These securities may not
earn as high a level of current income as long-term or lower quality
securities which generally have less liquidity, greater market risk and more
fluctuation in market value. The dollar-weighted average maturity of the
INTERMEDIATE BOND FUND'S portfolio ranges between three and ten years. The
BOND FUND invests without regard to maturity. Each Fund's investment
objective cannot be changed without approval by the holders of a majority
(as defined in the Investment Company Act of 1940) of its outstanding voting
shares. There can be no assurance that a Fund's investment objective will be
achieved.
MUNICIPAL OBLIGATIONS
Debt securities the interest from which is, in the opinion of bond
counsel to the issuer, exempt from Federal income tax ("Municipal
Obligations") generally include debt obligations issued to obtain funds for
various public purposes as well as certain industrial development bonds
issued by or on behalf of public authorities. Municipal Obligations are
classified as general obligation bonds, revenue bonds or notes. General
obligation bonds are secured by the issuer's pledge of its faith, credit and
taxing power for the payment of principal and interest. Revenue bonds are
payable from the revenue derived from a particular facility or class of
facilities or, in some cases, from the proceeds of a special excise or other
specific revenue source, but not from the general taxing power. Tax exempt
industrial development bonds, in most cases, are revenue bonds that generally
do not carry the pledge of the credit of the issuing municipality, but
generally are guaranteed by the corporate entity on whose behalf they are
issued. Notes are short-term instruments which are obligations of the issuing
municipalities or agencies and are sold in anticipation of a bond sale,
collection of taxes or receipt of other revenues. Municipal Obligations
include municipal lease/purchase agreements which are similar to installment
purchase contracts for property or equipment issued by municipalities.
Municipal Obligations bear fixed, floating or variable rates of interest. The
LONGER TERM FUNDS may purchase Municipal Obligations with interest rates that
are determined by formulas under which the rate will change directly or
inversely to changes in interest rates or an index, or multiples thereof, in
many cases subject to a maximum and minimum. Certain Municipal Obligations
purchased by the LONGER TERM FUNDS are subject to redemption at a date
earlier than their stated maturity pursuant to call options, which may be
separated from the related Municipal Obligation and purchased and sold
separately.
MANAGEMENT POLICIES
It is a fundamental policy of each Fund that it will invest at least
80% of the value of its respective net assets (except when maintaining a
temporary defensive position) in Municipal Obligations. Additionally, with
respect to each LONGER TERM FUND, at least 65% of the value of its net assets
(except when maintaining a temporary defensive position) will be invested in
bonds, debentures and other debt instruments. Generally, at least 65% of the
value of each Fund's net assets will be invested in New York Municipal
Obligations and the remainder may be invested in securities that are not New
York Municipal Obligations and therefore may be subject to New York State and
New York City income taxes. See "Risk Factors_Investing in New York Municipal
Obligations" below, and "Dividends, Distributions and Taxes."
MONEY MARKET FUND _ The MONEY MARKET FUND seeks to maintain a net
asset value of $1.00 per share for purchases and redemptions. To do so, the
MONEY MARKET FUND uses the amortized cost
Page 7
method of valuing its securities pursuant to Rule 2a-7 under the Investment
Company Act of 1940, certain requirements of which are summarized as follows.
In accordance with Rule 2a-7, the MONEY MARKET FUND will maintain a dollar-
weighted average portfolio maturity of 90 days or less, purchase only instru-
ments having remaining maturities of 13 months or less and invest only in U.S.
dollar denominated securities determined in accordance with procedures
established by the Fund's Board to present minimal credit risks and which are
rated in one of the two highest rating categories for debt obligations by at
least two nationally recognized statistical rating organizations (or one
rating organization if the instrument was rated only by one such
organization) or, if unrated, are of comparable quality as determined in
accordance with procedures established by its Board. The nationally
recognized statistical rating organizations currently rating investments of
the type the Fund may purchase are Moody's Investors Service, Inc.
("Moody's"), Standard & Poor's Corporation ("S&P") and Fitch Investors
Service, Inc. ("Fitch") and their rating criteria are described in Appendix B
to the Statement of Additional Information. For further information regarding
the amortized cost method of valuing securities, see "Determination of Net
Asset Value" in the Statement of Additional Information. There can be no
assurance that the MONEY MARKET FUND will be able to maintain a stable net
asset value of $1.00 per share.
INTERMEDIATE BOND FUND AND BOND FUND _ As to each LONGER TERM FUND,
at least 80% of the value of its net assets must consist of Municipal
Obligations which, in the case of bonds, are rated no lower than Baa by
Moody's or BBB by S&P or Fitch. Each LONGER TERM FUND may invest up to 20% of
the value of its net assets in Municipal Obligations which, in the case of
bonds, are rated lower than Baa by Moody's and BBB by S&P and Fitch and as
low as the lowest rating assigned by Moody's, S&P or Fitch. Each LONGER TERM
FUND may invest in short-term Municipal Obligations which are rated in the
two highest rating categories by Moody's, S&P or Fitch. See "Appendix B" in
the Statement of Additional Information. Municipal Obligations rated BBB by
S&P or Fitch or Baa by Moody's are considered investment grade obligations;
those rated BBB by S&P and Fitch are regarded as having an adequate capacity
to pay principal and interest, while those rated Baa by Moody's are
considered medium grade obligations which lack outstanding investment
characteristics and have speculative characteristics. Investments rated Ba or
lower by Moody's and BB or lower by S&P and Fitch ordinarily provide higher
yields but involve greater risk because of their speculative characteristics.
Each LONGER TERM FUND may invest in Municipal Obligations rated C by Moody's
or D by S&P or Fitch, which is the lowest rating assigned by such rating
organizations and indicates that the Municipal Obligation is in default and
interest and/or repayment of principal is in arrears. See "Risk Factors_Lower
Rated Bonds" below for a further discussion of certain risks. Each LONGER
TERM FUND also may invest in securities which, while not rated, are
determined by The Dreyfus Corporation to be of comparable quality to the
rated securities in which such LONGER TERM FUND may invest; for the purpose
of the 80% requirement described above, such unrated securities shall be
deemed to have the rating so determined. Each LONGER TERM FUND also may
invest in Taxable Investments of the quality described below.
Each LONGER TERM FUND may invest in zero coupon securities which are
debt securities issued or sold at a discount from their face value which do
not entitle the holder to any periodic payment of interest prior to maturity
or a specified redemption date (or cash payment date). The amount of the
discount varies depending on the time remaining until maturity or cash
payment date, prevailing interest rates, liquidity of the security and
perceived credit quality of the issuer. Zero coupon securities also may take
the form of debt securities that have been stripped of their unmatured
interest coupons, the coupons themselves and receipts or certificates
representing interest in such stripped debt obligations and coupons. The
market prices of zero coupon securities generally are more volatile than the
market prices of interest-bearing securities and are likely to respond to a
greater degree to changes in interest rates than interest-bearing securities
having similar maturities and credit qualities. Each LONGER TERM FUND may
invest up to 5% of its assets in zero coupon bonds which are rated below
investment grade. See
Page 8
"Risk Factors_Lower Rated Bonds" and "Other Investment Considerations" below,
and "Investment Objective and Management Policies_Risk Factors_Lower Rated
Bonds" and "Dividends, Distributions and Taxes" in the Statement of Additional
Information.
Each LONGER TERM FUND may purchase custodial receipts representing
the right to receive certain future principal and interest payments on
Municipal Obligations which underlie the custodial receipts. A number of
different arrangements are possible. In a typical custodial receipt
arrangement, an issuer or a third party owner of Municipal Obligations
deposits such obligations with a custodian in exchange for two classes of
custodial receipts. The two classes have different characteristics, but, in
each case, payments on the two classes are based on payments received on the
underlying Municipal Obligations. One class has the characteristics of a
typical auction rate security, where at specified intervals its interest rate
is adjusted, and ownership changes, based on an auction mechanism. This
class's interest rate generally is expected to be below the coupon rate of
the underlying Municipal Obligations and generally is at a level comparable
to that of a Municipal Obligation of similar quality and having a maturity
equal to the period between interest rate adjustments. The second class bears
interest at a rate that exceeds the interest rate typically borne by a
security of comparable quality and maturity; this rate also is adjusted, but
in this case inversely to changes in the rate of interest of the first class.
If the interest rate on the first class exceeds the coupon rate of the
underlying Municipal Obligations, its interest rate will exceed the rate paid
on the second class. In no event will the aggregate interest paid with
respect to the two classes exceed the interest paid by the underlying
Municipal Obligations. The value of the second class and similar securities
should be expected to fluctuate more than the value of a Municipal Obligation
of comparable quality and maturity and their purchase by a LONGER TERM FUND
should increase the volatility of its net asset value and, thus, its price
per share. These custodial receipts are sold in private placements. Each
LONGER TERM FUND also may purchase directly from issuers, and not in a private
placement, Municipal Obligations having characteristics similar to custodial
receipts. These securities may be issued as part of a multi-class offering
and the interest rate on certain classes may be subject to a cap or a floor.
ALL FUNDS (EXCEPT AS INDICATED BELOW) _ Each Fund may invest more
than 25% of the value of its total assets in Municipal Obligations which are
related in such a way that an economic, business or political development or
change affecting one such security also would affect the other securities;
for example, securities the interest upon which is paid from revenues of
similar types of projects. As a result, each Fund may be subject to greater
risk as compared to funds that do not follow this practice.
From time to time, a Fund may invest more than 25% of the value of
its total assets in industrial development bonds which, although issued by
industrial development authorities, may be backed only by the assets and
revenues of the non-governmental users. Interest on Municipal Obligations
(including certain industrial development bonds) which are specified private
activity bonds, as defined in the Internal Revenue Code of 1986, as amended
(the "Code"), issued after August 7, 1986, while exempt from Federal income
tax, is a preference item for the purpose of the alternative minimum tax.
Where a regulated investment company receives such interest, a proportionate
share of any exempt-interest dividend paid by the investment company may be
treated as such a preference item to shareholders. No Fund will invest more
than 20% of the value of its net assets in Municipal Obligations the interest
from which gives rise to a preference item for the purpose of the alternative
minimum tax and, except for temporary defensive purposes, in other
investments subject to Federal income tax.
Each Fund may purchase floating or variable rate demand notes, which
are tax exempt obligations ordinarily having stated maturities in excess of
13 months, but which permit the holder to demand payment of principal at any
time, or at specified intervals, which for the MONEY MARKET FUND will not
exceed 13 months, and in each case will be upon not more than 30 days'
notice. Variable rate demand notes include master demand notes which are
obligations that permit the Fund to invest fluctuating amounts, at varying
rates of interest, pursuant to direct arrangements between the Fund, as
lender, and
Page 9
the borrower. These obligations permit daily changes in the amount borrowed.
Frequently, such obligations are secured by letters of credit or other credit
support arrangements provided by banks. Use of letters of credit or other
credit support arrangements will not adversely affect the tax exempt status of
these obligations. Because these obligations are direct lending arrangements
between the lender and borrower, it is not contemplated that such instruments
will generally be traded, and there generally is no established secondary
market for these obligations, although they are redeemable at face value, plus
accrued interest. Accordingly, where these obligations are not secured by
letters of credit or other credit support arrangements, the Fund's right to
redeem is dependent on the ability of the borrower to pay principal and
interest on demand. Each obligation purchased by a Fund will meet the quality
criteria established for its purchase of Municipal Obligations. The Dreyfus
Corporation, on behalf of each Fund, will consider on an ongoing basis the
creditworthiness of the issuers of the floating and variable rate demand
obligations in the Fund's portfolio.
Each Fund may purchase from financial institutions participation
interests in Municipal Obligations (such as industrial development bonds and
municipal lease/purchase agreements). A participation interest gives a Fund
an undivided interest in the Municipal Obligation in the proportion that the
respective Fund's participation bears to the total principal amount of the
Municipal Obligation. These instruments may have fixed, floating or variable
rates of interest and, in the case of the MONEY MARKET FUND, will have
remaining maturities of 13 months or less. If the participation interest is
unrated, it will be backed by an irrevocable letter of credit or guarantee of
a bank that the respective Fund's Board has determined meets the prescribed
quality standards for banks set forth below, or the payment/obligation
otherwise will be collateralized by U.S. Government securities. For certain
participation interests, the Fund will have the right to demand payment, on
not more than seven days' notice, for all or any part of the Fund's
participation interest in the Municipal Obligation, plus accrued interest. As
to these instruments, each Fund intends to exercise its right to demand
payment only upon a default under the terms of the Municipal Obligation, as
needed to provide liquidity to meet redemptions, or to maintain or improve
the quality of its investment portfolio.
Each Fund may purchase tender option bonds. A tender option bond is a
Municipal Obligation (generally held pursuant to a custodial arrangement)
having a relatively long maturity and bearing interest at a fixed rate
substantially higher than prevailing short-term tax exempt rates, that has
been coupled with the agreement of a third party, such as a bank,
broker-dealer or other financial institution, pursuant to which such
institution grants the security holders the option, at periodic intervals, to
tender their securities to the institution and receive the face value
thereof. As consideration for providing the option, the financial institution
receives periodic fees equal to the difference between the Municipal
Obligation's fixed coupon rate and the rate, as determined by a remarketing
or similar agent at or near the commencement of such period, that would cause
the securities, coupled with the tender option, to trade at par on the date
of such determination. Thus, after payment of this fee, the security holder
effectively holds a demand obligation that bears interest at the prevailing
short-term tax exempt rate. The Dreyfus Corporation, on behalf of the Funds,
will consider on an ongoing basis the creditworthiness of the issuer of the
underlying Municipal Obligation, of any custodian and of the third party
provider of the tender option. In certain instances and for certain tender
option bonds, the option may be terminable in the event of a default in
payment of principal or interest on the underlying Municipal Obligations and
for other reasons. No Fund will invest more than 15% (10% in the case of the
MONEY MARKET FUND) of the value of its net assets in securities that are
illiquid, which could include tender option bonds as to which it cannot
exercise the tender feature on not more than seven days' notice if there is
no secondary market available for these obligations.
Each Fund may acquire "stand-by commitments" with respect to
Municipal Obligations held in its portfolio. Under a stand-by commitment, the
Fund obligates a broker, dealer or bank to repurchase, at the Fund's option,
specified securities at a specified price and, in this respect, stand-by
commitments are comparable to put options. The exercise of a stand-by
commitment therefore is subject to the ability of the seller to make payment
on
Page 10
demand. Each Fund will acquire stand-by commitments solely to facilitate
portfolio liquidity and does not intend to exercise any such rights
thereunder for trading purposes. Each Fund may pay for stand-by commitments
if such action is deemed necessary, thus increasing to a degree the cost of
the underlying Municipal Obligation and similarly decreasing such security's
yield to investors. The LONGER TERM FUNDS also may acquire call options on
specific Municipal Obligations. A LONGER TERM FUND generally would purchase
these call options to protect it from the issuer of the related Municipal
Obligation redeeming, or other holder of the call option from calling away,
the Municipal Obligation before maturity. The sale by a LONGER TERM FUND of a
call option that it owns on a specific Municipal Obligation could result in
the receipt of taxable income by the Fund.
Each Fund may invest up to 15% (10% in the case of the MONEY MARKET
FUND) of the value of its net assets in securities as to which a liquid
trading market does not exist, provided such investments are consistent with
the Fund's investment objective. Such securities may include securities that
are not readily marketable, such as certain securities that are subject to
legal or contractual restrictions on resale, and repurchase agreements
providing for settlement in more than seven days after notice. As to these
securities, the Fund is subject to a risk that should the Fund desire to sell
them when a ready buyer is not available at a price the Fund deems
representative of their value, the value of the Fund's net assets could be
adversely affected.
From time to time, on a temporary basis other than for temporary
defensive purposes (but not to exceed 20% of the value of its net assets) or
for temporary defensive purposes, a Fund may invest in taxable short-term
investments ("Taxable Investments") consisting of: notes to issuers having,
at the time of purchase, a quality rating within the two highest grades of
Moody's, S&P or Fitch; obligations of the U.S. Government, its agencies or
instrumentalities; commercial paper rated not lower than P-2 by Moody's, A-2
by S&P or F-2 by Fitch; certificates of deposit of U.S. domestic banks,
including foreign branches of domestic banks, with assets of one billion
dollars or more; time deposits; bankers' acceptances and other short-term
bank obligations; and repurchase agreements in respect of any of the
foregoing. Dividends paid by a Fund that are attributable to income earned by
the Fund from Taxable Investments will be taxable to investors. See
"Dividends, Distributions and Taxes." Except for temporary defensive
purposes, at no time will more than 20% of the value of a Fund's net assets
be invested in Taxable Investments and Municipal Obligations the interest
from which gives rise to a preference item for the purpose of the alternative
minimum tax. If the MONEY MARKET FUND purchases Taxable Investments, it will
value them using the amortized cost method and comply with Rule 2a-7 relating
to purchases of taxable instruments. When a Fund has adopted a temporary
defensive position, including when acceptable New York Municipal Obligations
are unavailable for investment by the Fund, in excess of 35% of its net
assets may be invested in securities that are not exempt from New York State
and New York City income taxes. Under normal market conditions, each Fund
anticipates that not more than 5% of the value of its total assets will be
invested in any one category of Taxable Investments. Taxable Investments are
more fully described in the Statement of Additional Information to which
reference hereby is made.
INVESTMENT TECHNIQUES
Each LONGER TERM FUND may employ, among others, the investment
techniques described below. Use of these techniques may give rise to taxable
income.
FUTURES TRANSACTIONS _ IN GENERAL _ Neither LONGER TERM FUND is a commodity
pool. However, as a substitute for a comparable market position in the
underlying securities or for hedging purposes, each LONGER TERM FUND may
engage in futures and options on futures transactions as described below.
Futures and options on futures transactions involve so-called "derivative
securities."
Each LONGER TERM FUND'S commodities transactions must constitute
bona fide hedging or other permissible transactions pursuant to regulations
promulgated by the Commodity Futures Trading Commission. In addition, each
LONGER TERM FUND may not engage in such transactions if the sum of the
Page 11
amount of initial margin deposits and premiums paid for unexpired commodity
options, other than for bona fide hedging transactions, would exceed 5% of the
liquidation value of such Fund's assets, after taking into account unrealized
profits and unrealized losses on such contracts it has entered into;
provided, however, that in the case of an option that is in-the-money at the
time of purchase, the in-the-money amount may be excluded in calculating the
5%. Pursuant to regulations and/or published positions of the Securities and
Exchange Commission, each LONGER TERM FUND may be required to segregate cash
or high quality money market instruments in connection with its commodities
transactions in an amount generally equal to the value of the underlying
commodity. To the extent a LONGER TERM FUND engages in the use of futures and
options on futures for other than bona fide hedging purposes, the Fund may be
subject to additional risk.
Initially, when purchasing or selling futures contracts each LONGER
TERM FUND will be required to deposit with its custodian in the broker's name
an amount of cash or cash equivalents up to approximately 10% of the contract
amount. This amount is subject to change by the exchange or board of trade on
which the contract is traded and members of such exchange or board of trade
may impose their own higher requirements. This amount is known as "initial
margin" and is in the nature of a performance bond or good faith deposit on
the contract which is returned to such Fund upon termination of the futures
position, assuming all contractual obligations have been satisfied.
Subsequent payments, known as "variation margin," to and from the broker will
be made daily as the price of the index or securities underlying the futures
contract fluctuates, making the long and short positions in the futures
contract more or less valuable, a process known as "marking-to-market." At
any time prior to the expiration of a futures contract, a Fund may elect to
close the position by taking an opposite position at the then prevailing
price, which will operate to terminate such Fund's existing position in the
contract.
Although each LONGER TERM FUND intends to purchase or sell futures
contracts only if there is an active market for such contracts, no assurance
can be given that a liquid market will exist for any particular contract at
any particular time. Many futures exchanges and boards of trade limit the
amount of fluctuation permitted in futures contract prices during a single
trading day. Once the daily limit has been reached in a particular contract,
no trades may be made that day at a price beyond the limit or trading may be
suspended for specified periods during the trading day. Futures contract
prices could move to the limit for several consecutive trading days with
little or no trading, thereby preventing prompt liquidation of futures
positions and potentially subjecting a Fund to a substantial loss. If it is
not possible, or such Fund determines not, to close a futures position in
anticipation of adverse price movements, such Fund will be required to make
daily cash payments of variation margin. In such circumstances, an increase
in the value of the portion of the portfolio being hedged, if any, may offset
partially or completely losses on the futures contract. However, no assurance
can be given that the price of the securities being hedged will correlate
with the price movements in a futures contract and thus provide an offset to
losses on the futures contract.
To the extent a LONGER TERM FUND is engaging in a futures transaction
as a hedging device, because of the risk of an imperfect correlation between
securities in such Fund's portfolio that are the subject of a hedging
transaction and the futures contract used as a hedging device, it is possible
that the hedge will not be fully effective if, for example, losses on the
portfolio securities exceed gains on the futures contract or losses on the
futures contract exceed gains on the portfolio securities. For futures
contracts based on indices, the risk of imperfect correlation increases as
the composition of such Fund's portfolio varies from the composition of the
index. In an effort to compensate for the imperfect correlation of movements
in the price of the securities being hedged and movements in the price of
futures contracts, such Fund may buy or sell futures contracts in a greater
or lesser dollar amount than the dollar amount of the securities being hedged
if the historical volatility of the futures contract has been less or greater
than that of the securities. Such "over hedging" or "under hedging" may
adversely affect a Fund's net investment results if the market does not move
as anticipated when the hedge is established.
Page 12
Successful use of futures by each LONGER TERM FUND is also subject to
The Dreyfus Corporation's ability to predict movements correctly in the
direction of the market or interest rates. For example, if a Fund has hedged
against the possibility of a decline in the market adversely affecting the
value of securities held in its portfolio and prices increase instead, such
Fund will lose part or all of the benefit of the increased value of
securities which it has hedged because it will have offsetting losses in its
futures positions. Furthermore, if in such circumstances a Fund has
insufficient cash, it may have to sell securities to meet daily variation
margin requirements. Each LONGER TERM FUND may have to sell such securities
at a time when it may be disadvantageous to do so.
An option on a futures contract gives the purchaser the right, in
return for the premium paid, to assume a position in a futures contract (a
long position if the option is a call and a short position if the option is a
put) at a specified exercise price at any time during the option exercise
period. The writer of the option is required upon exercise to assume an
offsetting futures position (a short position if the option is a call and a
long position if the option is a put). Upon exercise of the option, the
assumption of offsetting futures positions by the writer and holder of the
option will be accompanied by delivery of the accumulated cash balance in the
writer's futures margin account which represents the amount by which the
market price of the futures contract, at exercise, exceeds, in the case of a
call, or is less than, in the case of a put, the exercise price of the option
on the futures contract.
Call options sold by each LONGER TERM FUND with respect to futures
contracts will be covered by, among other things, entering into a long
position in the same contract at a price no higher than the strike price of
the call option, or by ownership of the instruments underlying, or
instruments the prices of which are expected to move relatively consistently
with the instruments underlying, the futures contract. Put options sold by
each LONGER TERM FUND with respect to futures contracts will be covered when,
among other things, cash or liquid securities are placed in a segregated
account to fulfill the obligation undertaken.
Each LONGER TERM FUND may utilize municipal bond index futures to
protect against changes in the market value of the Municipal Obligations in
its portfolio or which it intends to acquire. Municipal bond index futures
contracts are based on an index of long-term Municipal Obligations. The index
assigns relative values to the Municipal Obligations included in an index,
and fluctuates with changes in the market value of such Municipal
Obligations. The contract is an agreement pursuant to which two parties agree
to take or make delivery of an amount of cash based upon the difference
between the value of the index at the close of the last trading day of the
contract and the price at which the index contract was originally written.
The acquisition or sale of a municipal bond index futures contract enables a
Fund to protect its assets from fluctuations in rates on tax exempt
securities without actually buying or selling such securities.
INTEREST RATE FUTURES CONTRACTS AND OPTIONS ON INTEREST RATE FUTURES
CONTRACTS _ Each LONGER TERM FUND may purchase and sell interest rate
futures contracts and options on interest rate futures contracts as a
substitute for a comparable market position or to hedge against adverse
movements in interest rates.
To the extent a LONGER TERM FUND has invested in interest rate
futures contracts or options on interest rate futures contracts as a
substitute for a comparable market position, the Fund will be subject to the
investment risks of having purchased the securities underlying the contract.
Each LONGER TERM FUND may purchase call options on interest rate
futures contracts to hedge against a decline in interest rates and may
purchase put options on interest rate futures contracts to hedge its
portfolio securities against the risk of rising interest rates.
If a Fund has hedged against the possibility of an increase in
interest rates adversely affecting the value of securities held in its
portfolio and rates decrease instead, such Fund will lose part or all of the
benefit of the increased value of the securities which it has hedged because
it will have offsetting losses in its futures positions. In addition, in such
situations, if such Fund has insufficient cash, it may have to sell
securities to meet daily variation margin requirements at a time when it may
be disadvantageous to do so. These sales of securities may, but will not
necessarily, be at increased prices which reflect the decline in interest
rates.
Page 13
Each LONGER TERM FUND may sell call options on interest rate futures
contracts to partially hedge against declining prices of its portfolio
securities. If the futures price at expiration of the option is below the
exercise price, such Fund will retain the full amount of the option premium
which provides a partial hedge against any decline that may have occurred in
that Fund's portfolio holdings. Each LONGER TERM FUND may sell put options on
interest rate futures contracts to hedge against increasing prices of the
securities which are deliverable upon exercise of the futures contract. If
the futures price at expiration of the option is higher than the exercise
price, such Fund will retain the full amount of the option premium which
provides a partial hedge against any increase in the price of securities
which that Fund intends to purchase. If a put or call option sold by such
Fund is exercised, that Fund will incur a loss which will be reduced by the
amount of the premium it receives. Depending on the degree of correlation
between changes in the value of its portfolio securities and changes in the
value of its futures positions, such Fund's losses from existing options on
futures may to some extent be reduced or increased by changes in the value of
its portfolio securities.
Each LONGER TERM FUND also may sell options on interest rate futures
contracts as part of closing purchase transactions to terminate its options
positions. No assurance can be given that such closing transactions can be
effected or that there will be a correlation between price movements in the
options on interest rate futures and price movements in such Fund's portfolio
securities which are the subject of the hedge. In addition, such Fund's
purchase of such options will be based upon predictions as to anticipated
interest rate trends, which could prove to be inaccurate.
SHORT-SELLING _ Each LONGER TERM FUND may make short sales, which are
transactions in which a Fund sells a security it does not own in anticipation
of a decline in the market value of that security. To complete such a
transaction, such Fund must borrow the security to make delivery to the buyer.
That Fund then is obligated to replace the security borrowed by purchasing
it at the market price at the time of replacement. The price at such time may
be more or less than the price at which the security was sold by such Fund. A
LONGER TERM FUND will incur a loss as a result of the short sale if the price
of the security increases between the date of the short sale and the date on
which such Fund replaces the borrowed security. The LONGER TERM FUND will
realize a gain if the security declines in price between those dates.
Each LONGER TERM FUND may purchase call options to provide a hedge
against an increase in the price of a security sold short by such Fund. When
a Fund purchases a call option it has to pay a premium to the person writing
the option and a commission to the broker selling the option. If the option
is exercised by that Fund, the premium and the commission paid may be more
than the amount of the brokerage commission charged if the security were to
be purchased directly.
No securities will be sold short if, after effect is given to any
such short sale, the total market value of all securities sold short would
exceed 25% of the value of such Fund's net assets. Neither LONGER TERM FUND
may sell short securities of any single issuer listed on a national
securities exchange to the extent of more than 5% of the value of such Fund's
net assets. Neither LONGER TERM FUND may sell short the securities of any
class of an issuer to the extent, at the time of the transaction, of more
than 5% of the outstanding securities of that class.
In addition to the short sales discussed above, each LONGER TERM FUND
may make short sales "against the box," a transaction in which such Fund
enters into a short sale of a security which the Fund owns. Neither LONGER
TERM FUND will at any time have more than 15% of the value of its net assets
in deposits on short sales against the box. It currently is anticipated that
each LONGER TERM FUND will make short sales against the box for purposes of
protecting the value of its net assets.
FUTURE DEVELOPMENTS _ Each LONGER TERM FUND may take advantage of
opportunities in the area of options and futures contracts and options on
futures contracts and any other derivative investments which are not
presently contemplated for use by such Fund or which are not currently
available but which may be developed, to the extent such opportunities are
both consistent with the Fund's invest-
Page 14
ment objective and legally permissible for such LONGER TERM FUND. Before
entering into such transactions or making any such investment, each LONGER
TERM FUND will provide appropriate disclosure in its prospectus or statement
of additional information.
BORROWING MONEY _ As a fundamental policy each LONGER TERM FUND is permitted
to borrow to the extent permitted under the Investment Company Act of 1940,
as amended. However, each LONGER TERM FUND currently intends to borrow money
only for temporary or emergency (not leveraging) purposes, in an amount up to
15% of the value of the Fund's total assets (including the amount borrowed)
valued at the lesser of cost or market, less liabilities (not including the
amount borrowed) at the time the borrowing is made. While borrowings exceed
5% of a LONGER TERM FUND'S total assets, the Fund will not make any
additional investments.
LENDING PORTFOLIO SECURITIES _ From time to time, each LONGER TERM FUND may
lend securities from its portfolio to brokers, dealers and other financial
institutions needing to borrow securities to complete certain transactions.
Such loans may not exceed 331/3% of the value of such Fund's total assets. In
connection with such loans, the Fund will receive collateral consisting of
cash, U.S. Government securities or irrevocable letters of credit which will
be maintained at all times in an amount equal to at least 100% of the current
market value of the loaned securities. A LONGER TERM FUND can increase its
income through the investment of such collateral. The LONGER TERM FUND
continues to be entitled to payments in amounts equal to the interest or
other distributions payable on the loaned security and receives interest on
the amount of the loan. Such loans will be terminable at any time upon
specified notice. A LONGER TERM FUND might experience risk of loss if the
institution with which it has engaged in a portfolio loan transaction
breaches its agreement with such Fund.
CERTAIN FUNDAMENTAL POLICIES
Each Fund may invest up to 25% of its total assets in the securities
of issuers in any single industry, provided that there is no such limitation
on investments in Municipal Obligations and, for temporary defensive
purposes, securities issued by domestic banks and obligations issued or
guaranteed by the U.S. Government, its agencies or instrumentalities. Each
LONGER TERM FUND may borrow to the extent permitted under the Investment Com-
pany Act of 1940, which currently limits borrowing to no more than 331/3% of
the value of the Fund's total assets. The MONEY MARKET FUND may borrow money
from banks, but only for temporary or emergency (not leveraging) purposes, in
an amount up to 15% of the value of its total assets (including the amount
borrowed) based on the lesser of cost or market, less liabilities (not
including the amount borrowed) at the time the borrowing is made. While
borrowings exceed 5% of the value of such Fund's total assets, the Fund will
not make any additional investments. This paragraph describes fundamental
policies that cannot be changed, as to a Fund, without approval by the
holders of a majority (as defined in the Investment Company Act of 1940) of
such Fund's outstanding voting shares. See "Investment Objective and
Management Policies_Investment Restrictions" in the Statement of Additional
Information.
RISK FACTORS
INVESTING IN NEW YORK MUNICIPAL OBLIGATIONS _ You should consider carefully
the special risks inherent in investing in New York Municipal Obligations.
These risks result from the financial condition of New York State, certain of
its public bodies and municipalities, and New York City. Beginning in early
1975, New York State, New York City and other State entities faced serious
financial difficulties which jeopardized the credit standing and impaired the
borrowing abilities of such entities and contributed to high interest rates
on, and lower market prices for, debt obligations issued by them. A
recurrence of such financial difficulties or a failure of certain financial
recovery programs could result in defaults or declines in the market values
of various New York Municipal Obligations in which each Fund may invest. If
there should be a default or other financial crisis relating to New York
State, New York City, a State or City agency, or a State municipality, the
market value and marketability of outstanding New York Municipal Obligations
in a Fund's portfolio and the interest income to the Fund could be adversely
affected. Moreover, the national recession and the significant slowdown in
the New York and regional economies
Page 15
in the early 1990s added substantial uncertainty to estimates of the State's
tax revenues, which, in part, caused the State to incur cash-basis operating
deficits in the General Fund and issue deficit notes during the fiscal periods
1989 through 1992. The State's financial operations have improved, however,
during recent fiscal years. After reflecting a 1993 year-end deposit to the
refund reserve account of $671 million, reported 1993 General Fund receipts
were $45 million higher than originally projected in April 1992. The State com-
pleted the 1994 and 1995 fiscal years with operating surpluses of $914 million
and $158 million, respectively. There can be no assurance that New York will
not face substantial potential budget gaps in future years. In January 1992,
Moody's lowered from A to Baal the ratings on certain appropriation-backed
debt of New York State and its agencies. The State's general obligation, state
guaranteed and New York State Local Government Assistance Corporation bonds
continued to be rated A by Moody's. In January 1992, S&P lowered from A to A-
its ratings of New York State general obligation bonds and stated that it
continued to assess the ratings outlook as negative. The ratings of various
agency debt, state moral obligations, contractual obligations, lease purchase
obligations and state guarantees also were lowered. In February 1991, Moody's
lowered its rating on New York City's general obligation bonds from A to Baal
and in July 1995, S&P lowered its rating on such bonds from A- to BBB+. The
rating changes reflect the rating agencies' concerns about the financial
condition of New York State and City, the heavy debt load of the State and
City, and economic uncertainties in the region. You should obtain and review
a copy of the Statement of Additional Information which more fully sets forth
these and other risk factors attendant to an investment in each of the Funds.
LOWER RATED BONDS (APPLICABLE TO THE LONGER TERM FUNDS ONLY) _ You should
carefully consider the relative risks of investing in the higher yielding
(and, therefore, higher risk) securities in which a LONGER TERM FUND may
invest up to 20% of the value of its net assets. Lower rated bonds as
discussed herein are not eligible investments for the MONEY MARKET FUND.
These are bonds such as those rated Ba by Moody's or BB by S&P or Fitch, or
as low as the lowest rating assigned by Moody's, S&P or Fitch. They generally
are not meant for short-term investing and may be subject to certain risks
with respect to the issuing entity and to greater market fluctuations than
certain lower yielding, higher rated fixed-income securities. Bonds rated Ba
by Moody's are judged to have speculative elements; their future cannot be
considered as well assured and often the protection of interest and principal
payments may be very moderate. Bonds rated BB by S&P are regarded as having
predominantly speculative characteristics and, while such obligations have
less near-term vulnerability to default than other speculative grade debt,
they face major ongoing uncertainties or exposure to adverse business,
financial or economic conditions which could lead to inadequate capacity to
meet timely interest and principal payments. Bonds rated BB by Fitch are con-
sidered speculative and the payment of principal and interest may be affected
at any time by adverse economic changes. Bonds rated C by Moody's are regarded
as having extremely poor prospects of ever attaining any real investment
standing. Bonds rated D by S&P are in default and the payment of interest
and/or repayment of principal is in arrears. Bonds rated DDD, DD or D by
Fitch are in actual or imminent default, are extremely speculative and should
be valued on the basis of their ultimate recovery value in liquidation or
reorganization of the issuer; DDD represents the highest potential for
recovery of such bonds; and D represents the lowest potential for recovery.
Such bonds, though high yielding, are characterized by great risk. See
"Appendix B" in the Statement of Additional Information for a general
description of Moody's, S&P and Fitch ratings of Municipal Obligations. The
ratings of Moody's, S&P and Fitch represent their opinions as to the quality
of the Municipal Obligations which they undertake to rate. It should be
emphasized, however, that ratings are relative and subjective and, although
ratings may be useful in evaluating the safety of interest and principal pay-
ments, they do not evaluate the market value risk of these bonds. Therefore,
although these ratings may be an initial criterion for selection of portfolio
investments, The Dreyfus Corporation also will evaluate these securities and
the ability of the issuers of such securities to pay interest and principal.
The ability of a LONGER TERM FUND to achieve its invest-
Page 16
ment objective may be more dependent on The Dreyfus Corporation's credit
analysis than might be the case for a fund that invested in higher rated
securities. Once the rating of a portfolio security held by a LONGER TERM FUND
has been changed, the Fund will consider all circumstances deemed relevant in
determining whether to continue to hold the security.
The market price and yield of bonds rated Ba or lower by Moody's and
BB or lower by S&P and Fitch are more volatile than those of higher rated
bonds. Factors adversely affecting the market price and yield of these
securities will adversely affect each LONGER TERM FUND'S net asset value. In
addition, the retail secondary market for these bonds may be less liquid than
that of higher rated bonds; adverse market conditions could make it difficult
at times for the LONGER TERM FUNDS to sell certain securities or could result
in lower prices than those used in calculating the net asset value of each
LONGER TERM FUND.
Each LONGER TERM FUND may invest up to 5% of the value of its total
assets in zero coupon securities and pay-in-kind bonds (bonds which pay
interest through the issuance of additional bonds) rated Ba or lower by
Moody's and BB or lower by S&P and Fitch. These securities may be subject to
greater fluctuations in value due to changes in interest rates than
interest-bearing securities and thus may be considered more speculative than
comparably rated interest-bearing securities. See "Other Investment
Considerations" below, and "Investment Objective and Management Policies_Risk
Factors_Lower Rated Bonds" and "Dividends, Distributions and Taxes" in the
Statement of Additional Information.
OTHER INVESTMENT CONSIDERATIONS _ Even though interest-bearing securities
are investments which promise a stable stream of income, the prices of such
securities are inversely affected by changes in interest rates and,
therefore, are subject to the risk of market price fluctuations. Certain
securities that may be purchased by a LONGER TERM FUND, such as those with
interest rates that fluctuate directly or indirectly based on multiples of a
stated index, are designed to be highly sensitive to changes in interest
rates and can subject the holders thereof to extreme reductions of yield and
possibly loss of principal. The values of fixed-income securities also may be
affected by changes in the credit rating or financial condition of the
issuing entities. The MONEY MARKET FUND seeks to maintain a stable $1.00
share price, while the net asset value of each LONGER TERM FUND generally
will not be stable and should fluctuate based upon changes in the value of
the its respective portfolio securities. Securities in which the LONGER TERM
FUNDS invest may earn a higher level of current income than certain
shorter-term or higher quality securities which generally have greater
liquidity, less market risk and less fluctuation in market value.
New issues of Municipal Obligations usually are offered on a
when-issued basis, which means that delivery and payment for such Municipal
Obligations ordinarily take place within 45 days after the date of the
commitment to purchase. The payment obligation and the interest rate that
will be received on the Municipal Obligations are fixed at the time a Fund
enters into the commitment. A Fund will make commitments to purchase such
Municipal Obligations only with the intention of actually acquiring the
securities, but the Fund may sell these securities before the settlement date
if it is deemed advisable, although any gain realized on such sale would be
taxable. The Funds will not accrue income in respect of a when-issued
security prior to its stated delivery date. No additional when-issued
commitments will be made by a Fund if more than 20% of the value of its net
assets would be so committed.
Municipal Obligations purchased on a when-issued basis and the
securities held in a Fund's portfolio are subject to changes in value (both
generally changing in the same way, i.e., appreciating when interest rates
decline and depreciating when interest rates rise) based upon the public's
perception of the creditworthiness of the issuer and changes, real or
anticipated, in the level of interest rates. Municipal Obligations purchased
by a Fund on a when-issued basis may expose the Fund to risk because they may
experience such fluctuations prior to their actual delivery. Purchasing
Municipal Obligations on a when-issued basis can involve the additional risk
that the yield available in the market when the delivery takes place actually
may be higher than that obtained in the transaction itself. Each Fund will
establish and maintain at its custodian
Page 17
bank a segregated account consisting of cash, cash equivalents or U.S.
Government securities or other high quality liquid debt securities at least
equal at all times to the amount of the when-issued commitment. Purchasing
Municipal Obligations on a when-issued basis when a Fund is fully or almost
fully invested may result in greater potential fluctuation in the value of
such Fund's net assets and its net asset value per share.
Certain municipal lease/purchase obligations in which a Fund may
invest may contain "non-appropriation" clauses which provide that the
municipality has no obligation to make lease payments in future years unless
money is appropriated for such purpose on a yearly basis. Although
"non-appropriation" lease/purchase obligations are secured by the leased
property, disposition of the leased property in the event of foreclosure
might prove difficult. In evaluating the credit quality of a municipal
lease/purchase obligation that is unrated, The Dreyfus Corporation will
consider, on an ongoing basis, a number of factors including the likelihood
that the issuing municipality will discontinue appropriating funding for the
leased property.
Federal income tax law requires the holder of a zero coupon security
or of certain pay-in-kind bonds to accrue income with respect to these
securities prior to the receipt of cash payments. To maintain its
qualification as a regulated investment company and avoid liability for
Federal income taxes, a Fund may be required to distribute such income
accrued with respect to these securities and may have to dispose of portfolio
securities under disadvantageous circumstances in order to generate cash to
satisfy these distribution requirements.
Certain provisions in the Code relating to the issuance of Municipal
Obligations may reduce the volume of Municipal Obligations qualifying for
Federal tax exemption. One effect of these provisions could be to increase
the cost of the Municipal Obligations available for purchase by the Funds and
thus reduce the available yield. Shareholders should consult their tax
advisers concerning the effect of these provisions on an investment in a
Fund. Proposals that may restrict or eliminate the income tax exemption for
interest on Municipal Obligations may be introduced in the future. If any
such proposal were enacted that would reduce the availability of Municipal
Obligations for investment by a Fund so as to adversely affect its
shareholders, such Fund would reevaluate its investment objective and
policies and submit possible changes in its structure to shareholders for
their consideration. If legislation were enacted that would treat a type of
Municipal Obligation as taxable, the Funds would treat such security as a
permissible Taxable Investment within the applicable limits set forth herein.
Classification of each Fund as a "non-diversified" investment company
means that the proportion of the Fund's assets that may be invested in the
securities of a single issuer is not limited by the Investment Company Act of
1940. A "diversified" investment company is required by the Investment
Company Act of 1940 generally to invest, with respect to 75% of its total
assets, not more than 5% of such assets in the securities of a single issuer.
However, each Fund intends to conduct its operations so as to qualify as a
"regulated investment company" for purposes of the Code which requires that,
at the end of each quarter of its taxable year, (i) at least 50% of the
market value of the Fund's total assets be invested in cash, U.S. Government
securities, the securities of other regulated investment companies and other
securities, with such other securities of any one issuer limited for the
purposes of this calculation to an amount not greater than 5% of the value of
the Fund's total assets, and (ii) not more than 25% of the value of the total
assets of the Fund be invested in the securities of any one issuer (other
than U.S. Government securities or the securities of other regulated
investment companies). Since a relatively high percentage of each Fund's
assets may be invested in the obligations of a limited number of issuers, its
portfolio securities may be more susceptible to any single economic,
political or regulatory occurrence than the portfolio securities of a
diversified investment company.
Investment decisions for each Fund are made independently from those
of other investment companies advised by The Dreyfus Corporation. However, if
such other investment companies or one or more of the Funds are prepared to
invest in, or desire to dispose of, Municipal Obligations or Taxable
Investments at the same time, available investments or opportunities for
sales will be allocated equitably
Page 18
to each investment company and Fund. In some cases, this procedure may ad-
versely affect the size of the position obtained for or disposed of by a Fund
or the price paid or received by it.
MANAGEMENT OF THE FUNDS
The Dreyfus Corporation, located at 200 Park Avenue, New York, New
York 10166, was formed in 1947 and serves as the investment adviser to each
Fund. The Dreyfus Corporation is a wholly-owned subsidiary of Mellon Bank,
N.A., which is a wholly-owned subsidiary of Mellon Bank Corporation
("Mellon"). As of August 2, 1995, The Dreyfus Corporation managed or
administered approximately $79 billion in assets for more than 1.8 million
investor accounts nationwide.
The Dreyfus Corporation supervises and assists in the overall
management of the affairs of each Fund under a separate Management Agreement
with each Fund, subject to the overall authority of the Fund's Board, in
accordance with Massachusetts law, with respect to the MONEY MARKET FUND and I
NTERMEDIATE BOND FUND, or Maryland law, with respect to the BOND FUND. The
primary portfolio manager of the INTERMEDIATE BOND FUND and BOND FUND is
Monica S. Wieboldt. She has held that position since May 1987 for the
INTERMEDIATE BOND FUND and since May 1985 for the BOND FUND and has been
employed by The Dreyfus Corporation since November 1983. Each of these Fund's
other portfolio managers are identified in the Statement of Additional
Information. The Dreyfus Corporation also provides research services for each
Fund as well as for other funds advised by The Dreyfus Corporation through a
professional staff of portfolio managers and securities analysts.
Mellon is a publicly owned multibank holding company incorporated
under Pennsylvania law in 1971 and registered under the Federal Bank Holding
Company Act of 1956, as amended. Mellon provides a comprehensive range of
financial products and services in domestic and selected international
markets. Mellon is among the twenty-five largest bank holding companies in
the United States based on total assets. Mellon's principal wholly-owned
subsidiaries are Mellon Bank, N.A., Mellon Bank (DE) National Association,
Mellon Bank (MD), The Boston Company, Inc., AFCOCredit Corporation and a
number of companies known as Mellon Financial Services Corporations. Through
its subsidiaries, including The Dreyfus Corporation, Mellon managed more than
$203 billion in assets as of June 30, 1995, including approximately $73
billion in proprietary mutual fund assets. As of June 30, 1995, Mellon,
through various subsidiaries, provided non-investment services, such as
custodial or administration services, for more than $707 billion in assets,
including approximately $71 billion in mutual fund assets.
For the fiscal year ended May 31, 1995, the MONEY MARKET FUND paid
The Dreyfus Corporation a monthly management fee at the annual rate of .50 of
1% of the value of such Fund's average daily net assets, and each LONGER TERM
FUND paid The Dreyfus Corporation a monthly management fee at the annual rate
of .60 of 1% of the value of such Fund's average daily net assets. From time
to time, The Dreyfus Corporation may waive receipt of its fees and/or
voluntarily assume certain expenses of a Fund, which would have the effect of
lowering that Fund's overall expense ratio and increasing yield to investors
at the time such amounts are waived or assumed, as the case may be. No Fund
will pay The Dreyfus Corporation at a later time for any amounts it may
waive, nor will a Fund reimburse The Dreyfus Corporation for any amounts it
may assume.
The INTERMEDIATE BOND FUND bears certain costs of distributing its
shares in accordance with a plan (the "Service Plan") adopted pursuant to
Rule 12b-1 under the Investment Company Act of 1940 and the BOND FUND and
MONEY MARKET FUND bear certain allocated expenses for shareholder servicing
pursuant to separate plans. See "Annual Fund Operating Expenses" and "Service
Plan and Shareholder Services Plans."
The Dreyfus Corporation may pay the Fund's distributor for
shareholder services from The Dreyfus Corporation's own assets, including
past profits but not including the management fee paid by the
Page 19
Funds. The Fund's distributor may use part or all of such payments to pay
Service Agents in respect of these services.
The Fund's distributor is Premier Mutual Fund Services, Inc. (the
"Distributor"), located at One Exchange Place, Boston, Massachusetts 02109.
The Distributor is a wholly-owned subsidiary of FDI Distribution Services,
Inc., a provider of mutual fund administration services, which is in turn a
wholly-owned subsidiary of FDI Holdings, Inc., the parent company of which is
Boston Institutional Group, Inc.
The Shareholder Services Group, Inc., a subsidiary of First Data
Corporation, P.O. Box 9671, Providence, Rhode Island 02940-9671, is the
Transfer and Dividend Disbursing Agent (the "Transfer Agent") for each Fund.
The Bank of New York, 90 Washington Street, New York, New York 10286, is
Custodian for each Fund.
HOW TO BUY SHARES
Fund shares are sold through the Distributor or certain financial
institutions, securities dealers ("Selected Dealers") and other industry
professionals (collectively, "Service Agents") that have entered into service
agreements with the Distributor. Share certificates are issued only upon your
written request. No certificates are issued for fractional shares. It is not
recommended that any Fund be used as a vehicle for Keogh, IRA or other
qualified plans. Each Fund reserves the right to reject any purchase order.
The minimum initial investment is $2,500, or $1,000 if you are a
client of a Service Agent which has made an aggregate minimum initial
purchase for its customers of $2,500. Subsequent investments must be at least
$100. The initial investment must be accompanied by the respective Fund's
Account Application. For full-time or part-time employees of The Dreyfus
Corporation or any of its affiliates or subsidiaries, directors of The
Dreyfus Corporation, Board members of a fund advised by The Dreyfus
Corporation, including members of a Fund's Board, or the spouse or minor
child of any of the foregoing, the minimum initial investment is $1,000. For
full-time or part-time employees of The Dreyfus Corporation or any of its
affiliates or subsidiaries who elect to have a portion of their pay directly
deposited into their Fund account, the minimum initial investment is $50. The
Fund reserves the right to vary further the initial and subsequent investment
minimum requirements at any time. Fund shares also are offered without regard
to the minimum initial investment requirements through Dreyfus-AUTOMATIC
Asset Builder, Dreyfus Government Direct Deposit Privilege or Dreyfus Payroll
Savings Plan pursuant to the Dreyfus Step Program described under
"Shareholder Services." These services enable you to make regularly scheduled
investments and may provide you with a convenient way to invest for long-term
financial goals. You should be aware, however, that periodic investment plans
do not guarantee a profit and will not protect an investor against loss in a
declining market.
You may purchase Fund shares by check or wire, or through the Dreyfus
TELETRANSFER Privilege described below. Checks should be made payable to "The
Dreyfus Family of Funds." Payments to open new accounts which are mailed
should be sent to The Dreyfus Family of Funds, P.O. Box 9387, Providence,
Rhode Island 02940-9387, together with your Account Application. For
subsequent investments, your Fund account number should appear on the check
and an investment slip should be enclosed and sent to The Dreyfus Family of
Funds, P.O. Box 105, Newark, New Jersey 07101-0105. Neither initial nor sub-
sequent investments should be made by third party check. Purchase orders may
be delivered in person only to a Dreyfus Financial Center. THESE ORDERS WILL
BE FORWARDED TO THE RELEVANT FUND AND WILL BE PROCESSED ONLY UPON RECEIPT
THEREBY. For the location of the nearest Dreyfus Financial Center, please
call one of the telephone numbers listed under "General Information."
Wire payments may be made if your bank account is in a commercial
bank that is a member of the Federal Reserve System or any other bank having
a correspondent bank in New York City. Immediately available funds may be
transmitted by wire to The Bank of New York (DDA #8900052007/DREYFUS NEW YORK
TAX EXEMPT MONEY MARKET FUND; or DDA #8900052236/DREYFUS NEW YORK TAX
Page 20
EXEMPT INTERMEDIATE BOND FUND; or DDA #8900052422/DREYFUS NEW YORK TAX EXEMPT
BOND FUND, INC.), for purchase of Fund shares in your name. The wire must in-
clude your Fund account number (for new accounts, your Taxpayer Identification
Number ("TIN") should be included instead), account registration and dealer
number, if applicable. If your initial purchase of Fund shares is by wire,
please call 1-800-645-6561 after completing your wire payment to obtain your
Fund account number. Please include your Fund account number on the Fund's
Account Application and promptly mail the Account Application to the Fund, as
no redemptions will be permitted until the Account Application is received.
You may obtain further information about remitting funds in this manner from
your bank. All payments should be made in U.S. dollars and, to avoid fees and
delays, should be drawn only on U.S. banks. A charge will be imposed if any
check used for investment in your account does not clear. Other purchase
procedures may be in effect for clients of certain Service Agents. Each Fund
makes available to certain large institutions the ability to issue purchase
instructions through compatible computer facilities.
Subsequent investments also may be made by electronic transfer of
funds from an account maintained in a bank or other domestic financial
institution that is an Automated Clearing House member. You must direct the
institution to transmit immediately available funds through the Automated
Clearing House to The Bank of New York with instructions to credit your Fund
account. The instructions must specify your Fund account registration, and
your Fund account number PRECEDED BY THE DIGITS "1111."
Management understands that some Service Agents may impose certain
conditions on their clients which are different from those described in this
Prospectus, and, to the extent permitted by applicable regulatory
authorities, may charge their clients direct fees for Servicing (as defined
under "Service Plan and Shareholder Services Plans"). These fees would be in
addition to any amounts which might be received under the Service Plan of the
INTERMEDIATE BOND FUND. Each Service Agent has agreed to transmit to its
clients a schedule of such fees. You should consult your Service Agent in
this regard.
Shares of the MONEY MARKET FUND are sold on a continuous basis at the
net asset value per share next determined after an order in proper form and
Federal Funds (monies of member banks within the Federal Reserve System which
are held on deposit at a Federal Reserve Bank) are received by the Transfer
Agent. If you do not remit Federal Funds, your payment must be converted into
Federal Funds. This usually occurs within one business day of receipt of a
bank wire or within two business days of receipt of a check drawn on a member
bank of the Federal Reserve System. Checks drawn on banks which are not
members of the Federal Reserve System may take considerably longer to convert
into Federal Funds. Prior to receipt of Federal Funds, your money will not be
invested.
The MONEY MARKET FUND'S net asset value per share is determined as of
12:00 Noon, New York time, on each day that the New York Stock Exchange is
open for business. Net asset value per share is computed by dividing the
value of the MONEY MARKET FUND'S net assets (i.e., the value of its assets
less liabilities) by the total number of shares outstanding. See
"Determination of Net Asset Value" in the Statement of Additional Information.
If your payments into the MONEY MARKET FUND are received in or
converted into Federal Funds by 12:00 Noon, New York time, by the Transfer
Agent, you will receive the dividend declared that day. If your payments are
received in or converted into Federal Funds after 12:00 Noon, New York time,
by the Transfer Agent, you will begin to accrue dividends on the following
business day.
Qualified institutions may telephone orders for purchase of MONEY
MARKET FUND shares. These orders will become effective at the price
determined at 12:00 Noon, New York time, and the shares purchased will
receive the dividend on Fund shares declared on that day if the telephone
order is placed by 12:00 Noon, New York time, and Federal Funds are received
by 4:00 p.m., New York time, on that day.
Shares of the LONGER TERM FUNDS are sold on a continuous basis at the
net asset value per share next determined after an order in proper form is
received by the Transfer Agent. Net asset value per share is determined as of
the close of trading on the floor of the New York Stock Exchange (currently
4:00 p.m.,
Page 21
New York time), on each day that the New York Stock Exchange is open for
business. For purposes of determining the net asset value of each LONGER TERM
FUND, options and futures contracts will be valued 15 minutes after the close
of trading on the floor of the New York Stock Exchange. Net asset value per
share is computed by dividing the value of the specific Fund's net assets
(i.e., the value of its assets less liabilities) by the total number
of shares outstanding. The investments of each LONGER TERM FUND are valued by
an independent pricing service approved by such Fund's Board, and are valued
at fair value as determined by the pricing service. The pricing service's
procedures are reviewed under the general supervision of the Fund's Board.
For further information regarding the methods employed in valuing each LONGER
TERM FUND'S investments, see "Determination of Net Asset Value" in the
Statement of Additional Information.
Federal regulations require that you provide a certified TIN upon
opening or reopening a Fund account. See "Dividends, Distributions and Taxes"
and each Fund's Account Application for further information concerning this
requirement. Failure to furnish a certified TIN to the Fund could subject you
to a $50 penalty imposed by the Internal Revenue Service.
DREYFUS TELETRANSFER PRIVILEGE _ You may purchase shares (minimum $500,
maximum $150,000 per day) by telephone if you have checked the appropriate
box and supplied the necessary information on the Fund's Account Application
or have filed a Shareholder Services Form with the Transfer Agent. The
proceeds will be transferred between the bank account designated in one of
these documents and your Fund account. Only a bank account maintained in a
domestic financial institution which is an Automated Clearing House member
may be so designated. The Fund may modify or terminate this Privilege at any
time or charge a service fee upon notice to shareholders. No such fee
currently is contemplated.
If you have selected the Dreyfus TELETRANSFER Privilege, you may
request a Dreyfus TELETRANSFER purchase of shares by telephoning
1-800-221-4060 or, if you are calling from overseas, call 1-401-455-3306.
SHAREHOLDER SERVICES
The services and privileges described under this heading may not be
available to shareholders who are clients of certain Service Agents, and some
Service Agents may impose certain conditions on their clients which are
different from those described in this Prospectus. You should consult your
Service Agent in this regard.
FUND EXCHANGES _ You may purchase, in exchange for shares of a Fund, shares
of certain other funds managed or administered by The Dreyfus Corporation, to
the extent such shares are offered for sale in your state of residence. These
funds have different investment objectives which may be of interest to you.
If you desire to use this service, please call 1-800-645-6561 to determine if
it is available and whether any conditions are imposed on its use.
To request an exchange, you must give exchange instructions to the
Transfer Agent in writing or by telephone. Before any exchange, you must
obtain and should review a copy of the current prospectus of the fund into
which the exchange is being made. Prospectuses may be obtained by calling
1-800-645-6561. Except in the case of personal retirement plans, the shares
being exchanged must have a current value of at least $500; furthermore, when
establishing a new account by exchange, the shares being exchanged must have
a value of at least the minimum initial investment required for the fund into
which the exchange is being made. The ability to issue exchange instructions
by telephone is given to all Fund shareholders automatically, unless you
check the applicable "No" box on the Account Application, indicating that you
specifically refuse this Privilege. The Telephone Exchange Privilege may be
established for an existing account by written request, signed by all
shareholders on the account, or by a separate signed Shareholder Services
Form, also available by calling 1-800-645-6561. If you have established the
Telephone Exchange Privilege, you may telephone exchange instructions by
calling 1-800-221-4060 or, if you are calling from overseas, call
1-401-455-3306. See "How to Redeem Fund Shares_Procedures." Upon an exchange
into a new account, the following shareholder services and privileges, as
applicable and where available, will be automatically carried over to the
fund into which the exchange is made: Telephone Exchange Privilege, Check
Redemption Privilege,Wire Redemption Privilege,
Page 22
Telephone Redemption Privilege, Dreyfus TELETRANSFER
Privilege, and the dividend/capital gain distribution option (except for
Dreyfus Dividend Sweep) selected by the investor.
Shares will be exchanged at the next determined net asset value;
however, a sales load may be charged with respect to exchanges into funds
sold with a sales load. If you are exchanging into a fund that charges a
sales load, you may qualify for share prices which do not include the sales
load or which reflect a reduced sales load, if the shares of the fund from
which you are exchanging were: (a) purchased with a sales load, (b) acquired
by a previous exchange from shares purchased with a sales load, or (c)
acquired through reinvestment of dividends or distributions paid with respect
to the foregoing categories of shares. To qualify, at the time of your
exchange you must notify the Transfer Agent or your Service Agent must notify
the Distributor. Any such qualification is subject to confirmation of your
holdings through a check of appropriate records. See "Shareholder Services"
in the Statement of Additional Information. No fees currently are charged
shareholders directly in connection with exchanges, although each Fund
reserves the right, upon not less than 60 days' written notice, to charge its
shareholders a nominal fee in accordance with rules promulgated by the
Securities and Exchange Commission. Each Fund reserves the right to reject
any exchange request in whole or in part. The availability of Fund Exchanges
may be modified or terminated by each Fund at any time upon notice to its
shareholders.
The exchange of shares of one fund for shares of another is treated
for Federal income tax purposes as a sale of the shares given in exchange by
the shareholder and, therefore, an exchanging shareholder may realize a
taxable gain or loss.
DREYFUS AUTO-EXCHANGE PRIVILEGE _ Dreyfus Auto-Exchange Privilege enables
you to invest regularly (on a semi-monthly, monthly, quarterly or annual
basis), in exchange for shares of a Fund, in shares of other funds in the
Dreyfus Family of Funds of which you are currently an investor. The amount
you designate, which can be expressed either in terms of a specific dollar or
share amount ($100 minimum), will be exchanged automatically on the first
and/or fifteenth of the month according to the schedule you have selected.
Shares will be exchanged at the then-current net asset value; however, a
sales load may be charged with respect to exchanges into funds sold with a
sales load. See "Shareholder Services" in the Statement of Additional
Information. The right to exercise this Privilege may be modified or
cancelled by your Fund or the Transfer Agent. You may modify or cancel your
exercise of this Privilege at any time by writing to The Dreyfus Family of
Funds, P.O. Box 9671, Providence, Rhode Island 02940-9671. Each Fund may
charge a service fee for this Privilege. No such fee currently is
contemplated. The exchange of shares of one fund for shares of another is
treated for Federal income tax purposes as a sale of the shares given in
exchange by the shareholder and, therefore, an exchanging shareholder may
realize a taxable gain or loss. For more information concerning this
Privilege and the funds in the Dreyfus Family of Funds eligible to
participate in this Privilege, or to obtain a Dreyfus Auto-Exchange
Authorization Form, please call toll free 1-800-645-6561.
DREYFUS-AUTOMATIC ASSET BUILDERRegistration Mark _ Dreyfus-AUTOMATIC Asset
Builder permits you to purchase Fund shares (minimum of $100 and maximum of
$150,000 per transaction) at regular intervals selected by you. Fund shares
are purchased by transferring funds from the bank account designated by you.
At your option, the bank account designated by you will be debited in the
specified amount, and Fund shares will be purchased, once a month, on either
the first or fifteenth day, or twice a month, on both days. Only an account
maintained at a domestic financial institution which is an Automated Clearing
House member may be so designated. To establish a Dreyfus-Automatic Asset
Builder account, you must file an authorization form with the Transfer Agent.
You may obtain the necessary authorization form by calling 1-800-645-6561.
You may cancel your participation in this Privilege or change the amount of
purchase at any time by mailing written notification to The Dreyfus Family of
Funds, P.O. Box 9671, Providence, Rhode Island 02940-9671, and the
notification will be effective three business days following receipt. Each
Fund may modify or terminate this Privilege at any time or charge a service
fee. No such fee currently is contemplated.
Page 23
DREYFUS GOVERNMENT DIRECT DEPOSIT PRIVILEGE _ Dreyfus Government Direct
Deposit Privilege enables you to purchase shares of a Fund (minimum of $100
and maximum of $50,000 per transaction) by having Federal salary, Social
Security, or certain veterans', military or other payments from the Federal
government automatically deposited into your Fund account. You may deposit as
much of such payments as you elect. To enroll in Dreyfus Government Direct
Deposit, you must file with the Transfer Agent a completed Direct Deposit
Sign-Up Form for each type of payment that you desire to include in this
Privilege. The appropriate form may be obtained by calling 1-800-645-6561.
Death or legal incapacity will terminate your participation in this
Privilege. You may elect at any time to terminate your participation by
notifying in writing the appropriate Federal agency. Further, each Fund may
terminate your participation upon 30 days' notice to you.
DREYFUS PAYROLL SAVINGS PLAN _ Dreyfus Payroll Savings Plan permits you to
purchase Fund shares (minimum of $100 per transaction) automatically on a
regular basis. Depending upon your employer's direct deposit program, you may
have part or all of your paycheck transferred to your existing Dreyfus
account electronically through the Automated Clearing House system at each
pay period. To establish a Dreyfus Payroll Savings Plan account, you must
file an authorization form with your employer's payroll department. Your
employer must complete the reverse side of the form and return it to The
Dreyfus Family of Funds, P.O. Box 9671, Providence, Rhode Island 02940-9671.
You may obtain the necessary authorization form by calling 1-800-645-6561.
You may change the amount of purchase or cancel the authorization only by
written notification to your employer. It is the sole responsibility of your
employer, not the Distributor, The Dreyfus Corporation, the relevant Fund,
the Transfer Agent or any other person, to arrange for transactions under the
Dreyfus Payroll Savings Plan. Each Fund may modify or terminate this
Privilege at any time or charge a service fee. No such fee currently is
contemplated.
DREYFUS STEP PROGRAM _ Dreyfus Step Program enables you to purchase Fund
shares without regard to a Fund's minimum initial investment requirements
through Dreyfus-AUTOMATIC Asset Builder, Dreyfus Government Direct Deposit
Privilege or Dreyfus Payroll Savings Plan. To establish a Dreyfus Step
Program account, you must supply the necessary information on the relevant
Fund's Account Application and file the required authorization form(s) with
the Transfer Agent. For more information concerning this Program, or to
request the necessary authorization form(s), please call toll free
1-800-782-6620. You may terminate your participation in this Program at any
time by discontinuing your participation in Dreyfus-AUTOMATIC Asset Builder,
Dreyfus Government Direct Deposit Privilege or Dreyfus Payroll Savings Plan,
as the case may be, as provided under the terms of such Privilege(s). Each
Fund may modify or terminate this Program at any time.
Dreyfus Dividend Options _ Dreyfus Dividend Sweep enables you to invest
automatically dividends or dividends and capital gain distributions, if any,
paid by a Fund in shares of another fund in the Dreyfus Family of Funds of
which you are a shareholder. Shares of the other fund will be purchased at
the then-current net asset value; however, a sales load may be charged with
respect to investments in shares of a fund sold with a sales load. If you are
investing in a fund that charges a sales load, you may qualify for share
prices which do not include the sales load or which reflect a reduced sales
load. If you are investing in a fund that charges a contingent deferred sales
charge, the shares purchased will be subject on redemption to the contingent
deferred sales charge, if any, applicable to the purchased shares. See
"Shareholder Services" in the Statement of Additional Information. Dreyfus
Dividend ACH permits you to transfer electronically on the payment date
dividends or dividends and capital gain distributions, if any, from a Fund to
a designated bank account. Only an account maintained at a domestic financial
institution which is an Automated Clearing House member may be so designated.
Banks may charge a fee for this service.
For more information concerning these privileges or to request a
Dividend Options Form, please call toll free 1-800-645-6561. You may cancel
these privileges by mailing written notification to The Dreyfus Family of
Funds, P.O. Box 9671, Providence, Rhode Island 02940-9671. To select a new
fund after cancel-
Page 24
lation, you must submit a new Dividend Options Form. Enrollment in or cancel-
lation of these privileges is effective three business days following receipt
of notification. These privileges are available only for existing accounts and
may not be used to open new accounts. Minimum subsequent investments do not
apply for Dreyfus Dividend Sweep. Each Fund may modify or terminate these pri-
vileges at any time or charge a service fee. No such fee currently is contem-
plated.
AUTOMATIC WITHDRAWAL PLAN _ The Automatic Withdrawal Plan permits you to
request withdrawal of a specified dollar amount (minimum $50) on either a
monthly or quarterly basis if you have a $5,000 minimum account. An
application for the Automatic Withdrawal Plan can be obtained by calling
1-800-645-6561. There is a service charge of 50cents for each withdrawal
check. The Automatic Withdrawal Plan may be ended at any time by you, your
Fund or the Transfer Agent. Shares for which certificates have been issued
may not be redeemed through the Automatic Withdrawal Plan.
HOW TO REDEEM SHARES
GENERAL _ You may request redemption of your shares in any of the Funds at
any time. Redemption requests should be transmitted to the Transfer Agent as
described below. When a request is received in proper form, your Fund will
redeem the shares at the next determined net asset value.
No Fund imposes a charge when shares are redeemed. Service Agents may
charge their clients a nominal fee for effecting redemptions of Fund shares.
Any certificates representing Fund shares being redeemed must be submitted
with the redemption request. The value of the shares redeemed may be more or
less than their original cost, depending upon the respective Fund's
then-current net asset value.
Each Fund ordinarily will make payment for all shares redeemed within
seven days after receipt by the Transfer Agent of a redemption request in
proper form, except as provided by the rules of the Securities and Exchange
Commission. HOWEVER, IF YOU HAVE PURCHASED FUND SHARES BY CHECK, BY DREYFUS
TELETRANSFER PRIVILEGE OR THROUGH DREYFUS-AUTOMATIC ASSET BUILDER AND
SUBSEQUENTLY SUBMIT A WRITTEN REDEMPTION REQUEST TO THE TRANSFER AGENT, THE
REDEMPTION PROCEEDS WILL BE TRANSMITTED TO YOU PROMPTLY UPON BANK CLEARANCE
OF YOUR PURCHASE CHECK, DREYFUS TELETRANSFER PURCHASE OR DREYFUS-AUTOMATIC
ASSET BUILDER ORDER, WHICH MAY TAKE UP TO EIGHT BUSINESS DAYS OR MORE. IN
ADDITION, A FUND WILL NOT HONOR REDEMPTION CHECKS UNDER THE CHECK REDEMPTION
PRIVILEGE, AND WILL REJECT REQUESTS TO REDEEM SHARES BY WIRE OR TELEPHONE OR
PURSUANT TO THE DREYFUS TELETRANSFER PRIVILEGE, FOR A PERIOD OF EIGHT
BUSINESS DAYS AFTER RECEIPT BY THE TRANSFER AGENT OF THE PURCHASE CHECK, THE
DREYFUS TELETRANSFER PURCHASE OR THE DREYFUS-AUTOMATIC ASSET BUILDER ORDER
AGAINST WHICH SUCH REDEMPTION IS REQUESTED. THESE PROCEDURES WILL NOT APPLY
IF YOUR SHARES WERE PURCHASED BY WIRE PAYMENT OR IF YOU
OTHERWISE HAVE A SUFFICIENT COLLECTED BALANCE IN YOUR ACCOUNT TO COVER THE
REDEMPTION REQUEST. PRIOR TO THE TIME ANY REDEMPTION IS EFFECTIVE, DIVIDENDS
ON SUCH SHARES WILL ACCRUE AND BE PAYABLE, AND YOU WILL BE ENTITLED TO
EXERCISE ALL OTHER RIGHTS OF BENEFICIAL OWNERSHIP. Fund shares will not be
redeemed until the Transfer Agent has received your Account Application.
Each Fund reserves the right to redeem your account at its option
upon not less than 45 days' written notice if your account's net asset value
is $500 or less and remains so during the notice period.
PROCEDURES _ You may redeem shares by using the regular redemption procedure
through the Transfer Agent, the Check Redemption Privilege, the Wire
Redemption Privilege, the Telephone Redemption Privilege, the Dreyfus TELE-
TRANSFER Privilege or, if you are a client of a Selected Dealer, through the
Selected Dealer. Other redemption procedures may be in effect for clients or
certain Service Agents. The Fund makes available to certain large
institutions the ability to issue redemption instructions through compatible
computer facilities.
You may redeem Fund shares by telephone if you have checked the
appropriate box on the Fund's Account Application or have filed a Shareholder
Services Form with the Transfer Agent. If you select a telephone redemption
privilege or telephone exchange privilege (which is granted automatically
unless you
Page 25
refuse it), you authorize the Transfer Agent to act on telephone instructions
from any person representing himself or herself to be you, or a representative
of your Service Agent, and reasonably believed by the Transfer Agent to be
genuine. The Fund will require the Transfer Agent to employ reasonable pro-
cedures, such as requiring a form of personal identification, to confirm that
instructions are genuine and, if it does not follow such procedures, the Fund
or the Transfer Agent may be liable for any losses due to unauthorized or
fraudulent instructions. Neither the Fund nor the Transfer Agent will be
liable for following telephone instructions reasonably believed to be genuine.
During times of drastic economic or market conditions, you may
experience difficulty in contacting the Transfer Agent by telephone to
request a redemption or exchange of Fund shares. In such cases, you should
consider using the other redemption procedures described herein. Use of these
other redemption procedures may result in your redemption request being
processed at a later time than it would have been if telephone redemption had
been used. During the delay, a LONGER TERM FUND'S net asset value may
fluctuate.
REGULAR REDEMPTION _ Under the regular redemption procedure, you may redeem
shares by written request mailed to The Dreyfus Family of Funds, P.O. Box
9671, Providence, Rhode Island 02940-9671. Redemption requests may be
delivered in person only to a Dreyfus Financial Center. THESE REQUESTS WILL
BE FORWARDED TO THE RELEVANT FUND AND WILL BE PROCESSED ONLY UPON RECEIPT
THEREBY. For the location of the nearest Dreyfus Financial Center, please
call one of the telephone numbers listed under "General Information."
Redemption requests must be signed by the individual shareholder, including
each owner of a joint account, and each signature must be guaranteed. The
Transfer Agent has adopted standards and procedures pursuant to which
signature-guarantees in proper form generally will be accepted from domestic
banks, brokers, dealers, credit unions, national securities exchanges,
registered securities associations, clearing agencies and savings
associations, as well as from participants in the New York Stock Exchange Meda
llion Program, the Securities Transfer Agents Medallion Program ("STAMP") and
the Stock Exchanges Medallion Program. If you have any questions with respect
to signature-guarantees, please call one of the telephone numbers listed
under "General Information." Redemption proceeds of at least $1,000 will be
wired to any member bank of the Federal Reserve System in accordance with a
written signature-guaranteed request.
CHECK REDEMPTION PRIVILEGE _ You may request on the Account Application,
Shareholder Services Form or by later written request that your Fund provide
Redemption Checks drawn on the Fund's account. Redemption Checks may be made
payable to the order of any person in the amount of $500 or more. Potential
fluctuations in the net asset value of a LONGER TERM FUND'S shares should be
considered in determining the amount of any check drawn on such LONGER TERM
FUND'S account. Redemption Checks should not be used to close your account.
Redemption Checks are free, but the Transfer Agent will impose a fee for
stopping payment of a Redemption Check upon your request or if the Transfer
Agent cannot honor the Redemption Check due to insufficient funds or other
valid reason. You should date your Redemption Checks with the current date
when you write them. Please do not postdate your Redemption Checks. If you
do, the Transfer Agent will honor, upon presentment, even if presented before
the date of the check, all postdated Redemption Checks which are dated within
six months of presentment for payment, if they are otherwise in good order.
Shares for which certificates have been issued may not be redeemed by
Redemption Check. This Privilege may be modified or terminated at any time by
your Fund or the Transfer Agent upon notice to shareholders.
WIRE REDEMPTION PRIVILEGE _ You may request by wire or telephone that
redemption proceeds (minimum $1,000) be wired to your account at a bank which
is a member of the Federal Reserve System, or a correspondent bank if your
bank is not a member. To establish the Wire Redemption Privilege, you must
check the appropriate box and supply the necessary information on the Fund's
Account Application or file a Shareholder Services Form with the Transfer
Agent. You may direct that redemption proceeds be paid by check (maximum
$150,000 per day) made out to the owners of record and mailed to your
address. Redemption proceeds of less than $1,000 will be paid automatically
by check. Holders of jointly registered
Page 26
Fund or bank accounts may have redemption proceeds of not more than $250,000
wired within any 30-day period. You may telephone redemption requests by
calling 1-800-221-4060 or, if you are calling from overseas, call 1-401-
455-3306. Each Fund reserves the right to refuse any redemption request, in-
cluding requests made shortly after a change of address, and may limit the
amount involved or the number of such requests. This Privilege may be modified
or terminated at any time by the Transfer Agent or your Fund. The Statement of
Additional Information sets forth instructions for transmitting redemption
requests by wire. Shares for which certificates have been issued are not
eligible for this Privilege.
TELEPHONE REDEMPTION PRIVILEGE _ You may redeem Fund shares (maximum
$150,000 per day) by telephone if you have checked the appropriate box on the
Fund's Account Application or have filed a Shareholder Services Form with the
Transfer Agent. The redemption proceeds will be paid by check and mailed to
your address. You may telephone redemption instructions by calling
1-800-221-4060 or, if you are calling from overseas, call 1-401-455-3306. The
Fund reserves the right to refuse any request made by telephone, including
requests made shortly after a change of address, and may limit the amount
involved or the number of telephone redemption requests. This Privilege may
be modified or terminated at any time by the Transfer Agent or your Fund.
Shares for which certificates have been issued are not eligible for this
Privilege.
DREYFUS TELETRANSFER PRIVILEGE _ You may redeem shares (minimum $500 per
day) by telephone if you have checked the appropriate box and supplied the
necessary information on the Fund's Account Application or have filed a
Shareholder Services Form with the Transfer Agent. The proceeds will be
transferred between your Fund account and the bank account designated in one
of these documents. Only such an account maintained in a domestic financial
institution which is an Automated Clearing House member may be so designated.
Redemption proceeds will be on deposit in your account at an Automated
Clearing House member bank ordinarily two days after receipt of the
redemption request or, at your request, paid by check (maximum $150,000 per
day) and mailed to your address. Holders of jointly registered Fund or bank
accounts may redeem through the Dreyfus TELETRANSFER Privilege for transfer
to their bank account not more than $250,000 within any 30-day period. The
Fund reserves the right to refuse any request made by telephone, including
requests made shortly after a change of address, and may limit the amount
involved or the number of such requests. Each Fund may modify or terminate
this Privilege at any time or charge a service fee upon notice to
shareholders. No such fee currently is contemplated.
If you have selected the Dreyfus TELETRANSFER Privilege, you may
request a Dreyfus TELETRANSFER redemption of shares by telephoning
1-800-221-4060 or, if you are calling from overseas, call 1-401-455-3306.
Shares issued in certificate form are not eligible for this Privilege.
REDEMPTION THROUGH A SELECTED DEALER _ If you are a shareholder of the
INTERMEDIATE BOND FUND and a customer of a Selected Dealer, you may make
redemption requests to your Selected Dealer. If the Selected Dealer transmits
the redemption request so that it is received by the Transfer Agent by the
close of trading on the floor of the New York Stock Exchange (currently 4:00
p.m., New York time) on a given day, the redemption request will be effective
on that day. If a redemption request is received by the Transfer Agent after
the close of trading on the floor of the New York Stock Exchange, the redemp-
tion request will be effective on the next business day. It is the responsibi-
lity of the Selected Dealer to transmit a request so that it is received in a
timely manner. The proceeds of the redemption are credited to your account
with the Selected Dealer. See "How to Buy Shares" for a discussion of
additional conditions or fees that may be imposed upon redemption.
SERVICE PLAN AND SHAREHOLDER SERVICES PLANS
INTERMEDIATE BOND FUND _ Under the Service Plan, adopted by the INTERMEDIATE
BOND FUND pursuant to Rule 12b-1 under the Investment Company Act of 1940,
the INTERMEDIATE BOND FUND (a)reimburses the Distributor for payments to
certain Service Agents for distributing the Fund's shares and
Page 27
servicing shareholder accounts ("Servicing") and (b) pays The Dreyfus Corpora-
tion, Dreyfus Service Corporation, a wholly-owned subsidiary of The Dreyfus
Corporation, and any affiliate of either of them (collectively, "Dreyfus")
for advertising and marketing relating to the Fund and for Servicing, at an
aggregate annual rate of .25 of 1% of the value of the INTERMEDIATE BOND
FUND'S average daily net assets. Each of the Distributor and Dreyfus may pay
one or more Service Agents a fee in respect of the INTERMEDIATE BOND FUND'S
shares owned by shareholders with whom the Service Agent has a Servicing
relationship or for whom the Service Agent is the dealer or holder of record.
Each of the Distributor and Dreyfus determine the amount, if any, to be paid
to Service Agents under the Service Plan and the basis on which such payments
are made. The fees payable under the Service Plan are payable without regard
to actual expenses incurred.
The INTERMEDIATE BOND FUND also bears the costs of preparing and
printing prospectuses and statements of additional information used for
regulatory purposes and for distribution to existing shareholders. Under the
Service Plan, the INTERMEDIATE BOND FUND bears (a) the costs of preparing,
printing and distributing prospectuses and statements of additional
information used for other purposes, and (b) the costs associated with
implementing and operating the Service Plan (such as costs of printing and
mailing service agreements), the aggregate of such amounts not to exceed in
any fiscal year of the INTERMEDIATE BOND FUND the greater of $100,000 or .005
of 1% of the value of its average daily net assets for such fiscal year.
MONEY MARKET FUND AND BOND FUND _ Each of the MONEY MARKET FUND and BOND
FUND have adopted a separate Shareholder Services Plan pursuant to which the
Fund reimburses Dreyfus Service Corporation, an amount not to exceed an
annual rate of .25 of 1% of the value of such Fund's average daily net assets
for certain allocated expenses of providing personal services and/or
maintaining shareholder accounts. 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.
DIVIDENDS, DISTRIBUTIONS AND TAXES
Each Fund ordinarily declares dividends from net investment income on
each day the New York Stock Exchange is open for business. Earnings for
Saturdays, Sundays and holidays are declared as dividends on the next
business day. Dividends usually are paid on the last business day (calendar
day in the case of the MONEY MARKET FUND) of each month, and are
automatically reinvested in additional Fund shares at net asset value or, at
your option, paid in cash. With respect to the LONGER TERM FUNDS, Fund shares
begin earning income dividends on the day following the date of purchase. If
you redeem all shares in your account at any time during the month, all
dividends to which you are entitled will be paid to you along with the
proceeds of the redemption. If you are an omnibus accountholder and indicate
in a partial redemption request that a portion of any accrued dividends to
which such account is entitled belongs to an underlying accountholder who has
redeemed all shares in his or her account, such portion of the accrued
dividends will be paid to you along with the proceeds of the redemption.
Distributions from net realized securities gains, if any, generally are
declared and paid once a year, but each Fund may make distributions on a more
frequent basis to comply with the distribution requirements of the Code, in
all events in a manner consistent with the provisions of the Investment
Company Act of 1940. No Fund will make distributions from net realized
securities gains unless capital loss carryovers, if any, have been utilized
or have expired. You may choose whether to receive distributions in cash or
to reinvest in additional Fund shares at net asset value. All expenses are
accrued daily and deducted before declaration of dividends to investors.
Except for dividends from Taxable Investments, each Fund anticipates
that substantially all dividends paid by it will not be subject to Federal,
New York State or New York City personal income taxes. To the
Page 28
extent investors are obligated to pay state or local taxes outside of New York
State and New York City, dividends earned by an investment in a Fund may
represent taxable income. Dividends derived from Taxable Investments, together
with distributions from any net realized short-term securities gains and all
or a portion of any gain realized from the sale or other disposition of
certain market discount bonds, paid by a Fund are subject to Federal income
tax as ordinary income whether or not reinvested in additional Fund shares.
Distributions from net realized long-term securities gains of each Fund
generally are taxable as long-term capital gains for Federal income tax
purposes if you are a citizen or resident of the United States. The Code
provides that the net capital gain of an individual generally will not be
subject to Federal income tax at a rate in excess of 28%. Under the Code,
interest on indebtedness incurred or continued to purchase or carry Fund
shares which is deemed to relate to exempt-interest dividends is not
deductible. No dividend paid by a Fund will qualify for the dividends
received deduction allowable to certain U.S. corporations.
Although all or a substantial portion of the dividends paid by a Fund
may be excluded by shareholders from their gross income for Federal income
tax purposes, each Fund may purchase specified private activity bonds, the
interest from which may be (i) a preference item for purposes of the
alternative minimum tax, (ii) a component of the "adjusted current earnings"
preference item for purposes of the corporate alternative minimum tax as well
as a component in computing the corporate environmental tax or (iii) a factor
in determining the extent to which a shareholder's Social Security benefits
are taxable. If a Fund purchases such securities, the portion of its
dividends related thereto will not necessarily be tax exempt to an investor
who is subject to the alternative minimum tax and/or tax on Social Security
benefits and may cause an investor to be subject to such taxes.
Notice as to the tax status of your dividends and distributions will
be mailed to you annually. You also will receive periodic summaries of your
account which will include information as to dividends and distributions from
securities gains, if any, paid during the year. These statements set forth
the dollar amount of income exempt from Federal tax and the dollar amount, if
any, subject to Federal tax. These dollar amounts will vary depending on the
size and length of time of your investment in a Fund. If a Fund pays
dividends derived from taxable income, it intends to designate as taxable the
same percentage of the day's dividend as the actual taxable income earned on
that day bears to total income earned on that day. Thus, the percentage of
the dividend designated as taxable, if any, may vary from day to day.
Federal regulations generally require that each Fund withhold
("backup withholding") and remit to the U.S. Treasury 31% of taxable
dividends, distributions from net realized securities gains of the Fund and,
in the case of a LONGER TERM FUND, the proceeds of a redemption, regardless
of the extent to which gain or loss may be realized, paid to a shareholder if
such shareholder fails to certify either that the TIN furnished in connection
with opening an account is correct, or that such shareholder has not received
notice from the IRS of being subject to backup withholding as a result of a
failure to properly report taxable dividend or interest income on a Federal
income tax return. Furthermore, the IRS may notify a Fund to institute backup
withholding if the IRS determines that a shareholder's TIN is incorrect or if
a shareholder has failed to properly report taxable dividend and interest
income on a Federal income tax return.
A TIN is either the Social Security number or employer identification
number of the record owner of the account. Any tax withheld as a result of
backup withholding does not constitute an additional tax imposed on the
record owner of the account, and may be claimed as a credit on the record
owner's Federal income tax return.
Management of each Fund believes the Fund has qualified for the
fiscal year ended May 31, 1995 as a "regulated investment company" under the
Code. Each Fund intends to continue to so qualify as long as such
qualification is in the best interests of its respective shareholders. Such
qualification relieves a Fund of any liability for Federal income tax to the
extent its earnings are distributed in accordance with
Page 29
applicable provisions of the Code. Each Fund is subject to a non-deductible
4% excise tax, measured with respect to certain undistributed amounts of
taxable investment income and capital gains.
You should consult your tax adviser regarding specific questions as
to Federal, state or local taxes.
GENERAL INFORMATION
MONEY MARKET FUND AND-INTERMEDIATE BOND FUND. The MONEY MARKET FUND and
INTERMEDIATE BOND FUND were organized as unincorporated business trusts under
the laws of the Commonwealth of Massachusetts pursuant to a separate Agreement
and Declaration of Trust (collectively, the "Trust Agreements"), dated
February 16, 1987. The MONEY MARKET FUND commenced operations on June 9,
1987, and the INTERMEDIATE BOND FUND commenced operations on June 12, 1987.
Each such Fund is authorized to issue an unlimited number of shares of
beneficial interest, par value $.001 per share. Each share has one vote.
Under Massachusetts law, shareholders could, under certain
circumstances, be held personally liable for the obligations of the Fund of
which they are shareholders. However, the Trust Agreements disclaim
shareholder liability for acts or obligations of the Funds and require that
notice of such disclaimer be given in each agreement, obligation or
instrument entered into or executed by the Fund or a Trustee. The Trust
Agreements provide for indemnification from the respective Fund's property
for all losses and expenses of any shareholder held personally liable for the
obligations of the Fund. Thus, the risk of a shareholder incurring financial
loss on account of a shareholder liability is limited to circumstances in
which the Fund itself would be unable to meet its obligations, a possibility
which management believes is remote. Upon payment of any liability incurred
by a Fund, the shareholder paying such liability will be entitled to
reimbursement from the general assets of the Fund. The Trustees of each Fund
intend to conduct the operations of the Fund in such a way so as to avoid, as
far as possible, ultimate liability of the shareholders for liabilities of
the Fund. As discussed under "Management of the Funds" in the Statement of
Additional Information, each Fund ordinarily will not hold shareholder
meetings; however, shareholders under certain circumstances may have the
right to call a meeting of shareholders for the purpose of voting to remove
Trustees.
BOND FUND. The BOND FUND was incorporated under Maryland law on April 26,
1983, and commenced operations on July 26, 1983. The BOND FUND is authorized
to issue 300 million shares of Common Stock, par value $.01 per share. Each
share has one vote.
Unless otherwise required by the Investment Company Act of 1940,
ordinarily it will not be necessary for the Fund to hold annual meetings of
shareholders. As a result, Fund shareholders may not consider each year the
election of Directors or the appointment of auditors. However, pursuant to
the Fund's By-Laws, the holders of at least 10% of the shares outstanding and
entitled to vote may require the Fund to hold a special meeting of
shareholders for purposes of removing a Director from office and the holders
of at least 25% of such shares may require the Fund to hold a special meeting
of shareholders for any other purpose. Fund shareholders may remove a
Director by the affirmative vote of a majority of the Fund's outstanding
voting shares. In addition, the Board of Directors will call a meeting of
shareholders for the purpose of electing Directors if, at any time, less than
a majority of the Directors then holding office have been elected by
shareholders.
ALL FUNDS. Although each Fund is offering only its own shares, it is possible
that a Fund might become liable for any misstatement in this Prospectus about
another Fund. Each Fund's Board has considered this factor in approving the
use of this single combined Prospectus.
Page 30
The Transfer Agent maintains a record of your ownership and sends
confirmations and statements of account.
Shareholder inquiries may be made to your Service Agent or by writing
to the Fund at 144 Glenn Curtiss Boulevard, Uniondale, New York 11556-0144,
or by calling toll free 1-800-645-6561. In New York City, call
1-718-895-1206; outside the U.S. and Canada, call 516-794-5452.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS AND IN EACH
FUND'S OFFICIAL SALES LITERATURE IN CONNECTION WITH THE OFFER OF THE FUND'S
SHARES, AND, IF GIVEN OR MADE, SUCH OTHER INFORMATION OR REPRESENTATIONS MUST
NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY A FUND. AS TO EACH FUND, THIS
PROSPECTUS DOES NOT CONSTITUTE AN OFFER IN ANY STATE IN WHICH, OR TO ANY
PERSON TO WHOM, SUCH OFFERING MAY NOT LAWFULLY BE MADE.
Page 31
DREYFUS
#New York
Tax Exempt
Funds
Combined Prospectus for
*Dreyfus New YorkTax Exempt
Money Market Fund
* Dreyfus New York Tax Exempt
Intermediate Bond Fund
*Dreyfus New York Tax Exempt
Bond Fund, Inc.
(Dreyfus Logo)
Registration Mark
Copy Rights 1995 Dreyfus Service Corporation
NYTEFP4090195
DREYFUS NEW YORK TAX EXEMPT FUNDS
COMBINED PART B
(STATEMENT OF ADDITIONAL INFORMATION)
FOR
DREYFUS NEW YORK TAX EXEMPT MONEY MARKET FUND
DREYFUS NEW YORK TAX EXEMPT INTERMEDIATE BOND FUND
DREYFUS NEW YORK TAX EXEMPT BOND FUND, INC.
SEPTEMBER 1, 1995
This Statement of Additional Information, which is not a prospectus,
supplements and should be read in conjunction with the current Combined
Prospectus of Dreyfus New York Tax Exempt Money Market Fund (the "Money
Market Fund"), Dreyfus New York Tax Exempt Intermediate Bond Fund (the
"Intermediate Bond Fund"), and Dreyfus New York Tax Exempt Bond Fund, Inc.
(the "Bond Fund")(collectively, the "Funds"), dated September 1, 1995, as
it may be revised from time to time. To obtain a copy of the Prospectus,
please write to the Funds at 144 Glenn Curtiss Boulevard, Uniondale, New
York 11556-0144, or call the following numbers:
Call Toll Free 1-800-645-6561
In New York City - Call 1-718-895-1206
Outside the U.S. and Canada - Call 516-794-5452
The Dreyfus Corporation (the "Manager") serves as each Fund's
investment adviser.
Premier Mutual Fund Services, Inc. (the "Distributor") is the
distributor of each Fund's shares.
Each Fund is a separate entity with a separate portfolio. The
operations and investment results of one Fund are unrelated to those of
each other Fund. This combined Statement of Additional Information has
been prepared for your convenience to provide you the opportunity to
consider three investment choices in one document.
TABLE OF CONTENTS
Page
Investment Objective and Management Policies . . . . . . . . . . B-2
Management of the Funds. . . . . . . . . . . . . . . . . . . . . B-12
Management Agreements. . . . . . . . . . . . . . . . . . . . . . B-16
Purchase of Shares . . . . . . . . . . . . . . . . . . . . . . . B-18
Service Plan and Shareholder Services Plans. . . . . . . . . . . B-19
Redemption of Shares . . . . . . . . . . . . . . . . . . . . . . B-21
Shareholder Services . . . . . . . . . . . . . . . . . . . . . . B-23
Determination of Net Asset Value . . . . . . . . . . . . . . . . B-26
Portfolio Transactions . . . . . . . . . . . . . . . . . . . . . B-27
Dividends, Distributions and Taxes . . . . . . . . . . . . . . . B-28
Performance Information. . . . . . . . . . . . . . . . . . . . . B-28
Information About the Funds. . . . . . . . . . . . . . . . . . . B-30
Custodian, Transfer and Dividend Disbursing Agent,
Counsel and Independent Auditors. . . . . . . . . . . . . . . B-30
Appendix A . . . . . . . . . . . . . . . . . . . . . . . . . . . B-32
Appendix B . . . . . . . . . . . . . . . . . . . . . . . . . . . B-46
Financial Statements and Reports of Independent Auditors
Money Market Fund . . . . . . . . . . . . . . . . . . . . . . B-54
Intermediate Bond Fund. . . . . . . . . . . . . . . . . . . . B-62
Bond Fund . . . . . . . . . . . . . . . . . . . . . . . . . . B-76
INVESTMENT OBJECTIVE AND MANAGEMENT POLICIES
The following information supplements and should be read in
conjunction with the section in the Prospectus entitled "Description of the
Funds."
Portfolio Securities
<TABLE>
<CAPTION>
The average distribution of investments (at value) in Municipal
Obligations by ratings for the fiscal year ended May 31, 1995, computed on
a monthly basis, for each Fund was as follows:
Fitch Moody's Standard & Percentage of Value
Investors Investors Poor's --------------------------------------------
Service, Inc. Service, Inc. Corporation Money Intermediate
("Fitch") or ("Moody's") or ("S&P") or Market Fund Bond Fund Bond Fund
- ------------ ------------- ----------- ----------- ------------ ---------
<S> <C> <C> <C> <C> <C>
AAA Aaa AAA 0.2% 21.6% 19.9%
AA Aa AA N/A 14.7% 24.9%
A A A N/A 30.1% 30.8%
BBB Baa BBB N/A 28.2% 20.1%
BB Ba BB N/A 0.0% 0.1%
F-1 VMIG1/MIG1,P-1 SP-1,A-1 92.1% 1.4%* 3.7%*
Not Rated Not Rated Not Rated 7.7% 4.0%** 0.5%***
------ ------- ------
100.0% 100.0% 100.0%
________________________
* Includes notes rated within the highest grades by Moody's, S&P or
Fitch, which, together with Municipal Obligations rated Baa/BBB, are
taken into account at the time of a purchase to ensure that the
portfolios of the Intermediate Bond Fund and Bond Fund (collectively,
the "Longer Term Funds") meet the 80% minimum quality standard
discussed in the Prospectus.
** Includes securities comprising 4.0% of the Intermediate Bond Fund's net
assets which, while not rated, have been determined by the Manager to
be of comparable quality to securities in the following rating
categories: Aa/AA (1.1%) and Baa/BBB (2.9%).
*** Includes securities comprising 0.5% of the Bond Fund's net assets
which, while not rated, have been determined by the Manager to be of
comparable quality to securities in the following rating categories;
Baa/BBB (0.5%).
</TABLE>
Municipal Obligations. The term "Municipal Obligations" generally
includes debt obligations issued to obtain funds for various public
purposes, including the construction of a wide range of public facilities
such as airports, bridges, highways, housing, hospitals, mass
transportation, schools, streets and water and sewer works. Other public
purposes for which Municipal Obligations may be issued include refunding
outstanding obligations, obtaining funds for general operating expenses and
lending such funds to other public institutions and facilities. In
addition, certain types of industrial development bonds are issued by or on
behalf of public authorities to obtain funds to provide for the
construction, equipment, repair or improvement of privately operated
housing facilities, sports facilities, convention or trade show facilities,
airport, mass transit, industrial, port or parking facilities, air or water
pollution control facilities and certain local facilities for water supply,
gas, electricity, or sewage or solid waste disposal; the interest paid on
such obligations may be exempt from Federal income tax, although current
tax laws place substantial limitations on the size of such issues. Such
obligations are considered to be Municipal Obligations if the interest paid
thereon qualifies as exempt from Federal income tax in the opinion of bond
counsel to the issuer. There are, of course, variations in the security of
Municipal Obligations, both within a particular classification and between
classifications.
Floating and variable rate demand notes and bonds are tax exempt
obligations normally having stated maturities in excess of one year, but
which permit the holder to demand payment of principal at any time or at
specified intervals. The issuer of such obligations normally has a
corresponding right, after a given period, to prepay in its discretion the
outstanding principal amount of the obligation plus accrued interest upon a
specified number of days' notice to the holders thereof. The interest rate
on a floating rate demand obligation is based on a known lending rate, such
as a bank's prime rate, and is adjusted automatically each time such rate
is adjusted. The interest rate on a variable rate demand obligation is
adjusted automatically at specified intervals.
The yields on Municipal Obligations are dependent on a variety of
factors, including general economic and monetary conditions, money market
factors, conditions in the Municipal Obligations market, size of a
particular offering, maturity of the obligation, and rating of the issue.
The imposition of a Fund's management fee, as well as other operating
expenses, including fees paid under a Service Plan or Shareholder Services
Plan, will have the effect of reducing the yield to investors in that Fund.
Municipal lease obligations or installment purchase contract
obligations (collectively, "lease obligations") have special risks not
normally associated with Municipal Obligations. Although lease obligations
do not constitute general obligations of the municipality for which the
municipality's taxing power is pledged, a lease obligation ordinarily is
backed by the municipality's covenant to budget for, appropriate and make
the payments due under the lease obligation. However, certain lease
obligations contain "non-appropriation" clauses which provide that the
municipality has no obligation to make lease or installment purchase
payments in future years unless money is appropriated for such purpose on a
yearly basis. Although "non-appropriation" lease obligations are secured
by the leased property, disposition of the property in the event of
foreclosure might prove difficult. The Money Market Fund will invest only
in those lease obligations that (1) are rated in one of the two highest
rating categories for debt obligations by at least two nationally
recognized statistical rating organizations (or one rating organization if
the lease obligation was rated only by one such organization); or (2) if
unrated, are purchased principally from the issuer or domestic banks or
other responsible third parties, in each case only if the seller shall have
entered into an agreement with the Money Market Fund providing that the
seller or other responsible third party will either remarket or repurchase
the lease obligation within a short period after demand by the Fund. The
staff of the Securities and Exchange Commission currently considers certain
lease obligations to be illiquid. With regard to the Longer Term Funds,
determination as to the liquidity of such securities is made in accordance
with guidelines established by each Fund's Board. Pursuant to such
guidelines, each Board has directed the Manager to monitor carefully each
Fund's investment in such securities with particular regard to (1) the
frequency of trades and quotes for the lease obligation; (2) the number of
dealers willing to purchase or sell the lease obligation and the number of
other potential buyers; (3) the willingness of dealers to undertake to make
a market in the lease obligation; (4) the nature of the marketplace trades
including the time needed to dispose of the lease obligation, the method of
soliciting offers and the mechanics of transfer; and (5) such other factors
concerning the trading market for the lease obligation as the Manager may
deem relevant. In addition, in evaluating the liquidity and credit
quality of a lease obligation that is unrated, each Fund's Board has
directed the Manager to consider (a) whether the lease can be cancelled;
(b) what assurance there is that the assets represented by the lease can be
sold; (c) the strength of the lessee's general credit (e.g., its debt,
administrative, economic, and financial characteristics); (d) the
likelihood that the municipality will discontinue appropriating funding for
the leased property because the property is no longer deemed essential to
the operations of the municipality (e.g., the potential for an "event of
nonappropriation"); (e) the legal recourse in the event of failure to
appropriate; and (f) such other factors concerning credit quality as the
Manager may deem relevant. No Fund will invest more than 15% (10% in the
case of the Money Market Fund) of the value of its net assets in lease
obligations that are illiquid and in other illiquid securities.
The Money Market Fund will not purchase tender option bonds unless (a)
the demand feature applicable thereto is exercisable by the Fund within 13
months of the date of such purchase upon no more than 30 days' notice and
thereafter is exercisable by the Fund no less frequently than annually upon
no more than 30 days' notice and (b) at the time of such purchase, the
Manager reasonably expects (i) based upon its assessment of current and
historical interest rate trends, that prevailing short-term tax exempt
rates will not exceed the stated interest rate on the underlying Municipal
Obligations at the time of the next tender fee adjustment and (ii) that the
circumstances which might entitle the grantor of a tender option to
terminate the tender option would not occur prior to the time of the next
tender opportunity. At the time of each tender opportunity, the Fund will
exercise the tender option with respect to any tender option bonds unless
the Manager reasonably expects, (x) based upon its assessment of current
and historical interest rate trends, that prevailing short-term tax exempt
rates will not exceed the stated interest rate on the underlying Municipal
Obligations at the time of the next tender fee adjustment, and (y) that the
circumstances which entitle the grantor of a tender option to terminate the
tender option would not occur prior to the time of the next tender
opportunity. The Fund will exercise the tender feature with respect to
tender option bonds, or otherwise dispose of its tender option bonds, prior
to the time the tender option is scheduled to expire pursuant to the terms
of the agreement under which the tender option is granted. The Money
Market Fund otherwise will comply with the provisions of Rule 2a-7 in
connection with the purchase of tender option bonds, including, without
limitation, the requisite determination by the Money Market Fund's Board of
Trustees that the tender option bonds in question meet the quality
standards described in Rule 2a-7, which, in the case of a tender option
bond subject to a conditional demand feature, would include a determination
that the security has received both the required short-term and long-term
quality rating or is determined to be of comparable quality. In the event
of a default of the Municipal Obligation underlying a tender option bond,
or the termination of the tender option agreement, the Money Market Fund
would look to the maturity date of the underlying security for purposes of
compliance with Rule 2a-7 and, if its remaining maturity was greater than
13 months, the Fund would sell the security as soon as would be
practicable.
Each Fund will purchase tender option bonds only when the Fund is
satisfied that the custodial and tender option arrangements will not
adversely affect the tax exempt status of the underlying Municipal
Obligations and that payment of any tender fees will not have the effect of
creating taxable income for such Fund. Based on the tender option bond
agreement, each Fund expects to be able to value the tender option bond at
par; however, the value of the instrument will be monitored to assure that
it is valued at fair value.
Ratings of Municipal Obligations. If, subsequent to being purchased
by the Money Market Fund, (a) an issue of rated Municipal Obligations
ceases to be rated in the highest rating category by at least two rating
organizations (or one rating organization if the instrument was rated by
only one organization), or the Money Market Fund's Board determines that it
is no longer of comparable quality; or (b) the Manager becomes aware that
any portfolio security not so highly rated or any unrated security has been
given a rating by any rating organization below the rating organization's
second highest rating category, the Money Market Fund's Board will reassess
promptly whether such security presents minimal credit risk and will cause
the Fund to take such action as it determines is in the best interest of
the Fund and its shareholders, provided that the reassessment required by
clause (b) is not required if the portfolio security is disposed of or
matures within five business days of the Manager becoming aware of the new
rating and the Fund's Board is subsequently notified of the Manager's
actions. Subsequent to being purchased by the Longer Term Funds, an issue
of rated Municipal Obligations may cease to be rated or its rating may be
reduced below the minimum required for purchase by such Funds. Neither
event will require the sale of such Municipal Obligations by a Longer Term
Fund, but the Manager will consider such event in determining whether the
Fund should continue to hold the Municipal Obligations.
To the extent the ratings by Moody's, S&P or Fitch for Municipal
Obligations may change as a result of changes in such organizations or
their rating systems, the Funds will attempt to use comparable ratings as
standards for its investments in accordance with the investment policies
contained in the Prospectus and this Statement of Additional Information.
The ratings of Moody's, S&P and Fitch represent their opinions as to the
quality of the Municipal Obligations which they undertake to rate. It
should be emphasized, however, that ratings are relative and subjective and
are not absolute standards of quality. Although these ratings may be an
initial criterion for selection of portfolio investments, the Manager also
will evaluate these securities and the creditworthiness of the issuers of
such securities.
Illiquid Securities. If a substantial market of qualified
institutional buyers develops pursuant to Rule 144A under the Securities
Act of 1933, as amended, for certain restricted securities held by a Fund,
the Fund intends to treat such securities as liquid securities in
accordance with procedures approved by the Fund's Board. Because it is not
possible to predict with assurance how the market for restricted securities
pursuant to Rule 144A will develop, each Fund's Board has directed the
Manager to monitor carefully the Fund's investments in such securities with
particular regard to trading activity, availability of reliable price
information and other relevant information. To the extent that, for a
period of time, qualified institutional buyers cease purchasing restricted
securities pursuant to Rule 144A, a Fund's investing in such securities may
have the effect of increasing the level of illiquidity in a Fund's
portfolio during such period.
Taxable Investments. Securities issued or guaranteed by the U.S.
Government or its agencies or instrumentalities include U.S. Treasury
securities, which differ in their interest rates, maturities and times of
issuance. Some obligations issued or guaranteed by U.S. Government
agencies and instrumentalities, for example, Government National Mortgage
Association pass-through certificates, are supported by the full faith and
credit of the U.S. Treasury; others, such as those of the Federal Home Loan
Banks, by the right of the issuer to borrow from the Treasury; others, such
as those issued by the Federal National Mortgage Association, by
discretionary authority of the U.S. Government to purchase certain
obligations of the agency or instrumentality; and others, such as those
issued by the Student Loan Marketing Association, only by the credit of the
agency or instrumentality. These securities bear fixed, floating or
variable rates of interest. Interest may fluctuate based on generally
recognized reference rates or the relationship of rates. While the U.S.
Government provides financial support to such U.S. Government-sponsored
agencies or instrumentalities, no assurance can be given that it will
always do so, since it is not so obligated by law. A Fund will invest in
such securities only when it is satisfied that the credit risk with respect
to the issuer is minimal.
Commercial paper consists of short-term, unsecured promissory notes
issued to finance short-term credit needs.
Certificates of deposit are negotiable certificates representing the
obligation of a bank to repay funds deposited with it for a specified
period of time.
Time deposits are non-negotiable deposits maintained in a banking
institution for a specified period of time (in no event longer than seven
days) at a stated interest rate. Investments in time deposits generally
are limited to London branches of domestic banks that have total assets in
excess of one billion dollars. Time deposits which may be held by a Fund
will not benefit from insurance from the Bank Insurance Fund or the Savings
Association Insurance Fund administered by the Federal Deposit Insurance
Corporation.
Bankers' acceptances are credit instruments evidencing the obligation
of a bank to pay a draft drawn on it by a customer. These instruments
reflect the obligation both of the bank and of the drawer to pay the face
amount of the instrument upon maturity. Other short-term bank obligations
may include uninsured, direct obligations bearing fixed, floating or
variable interest rates.
Repurchase agreements involve the acquisition by a Fund of an
underlying debt instrument subject to an obligation of the seller to
repurchase, and the Fund to resell, the instrument at a fixed price,
usually not more than one week after its purchase. The Fund's custodian or
sub-custodian will have custody of, and will hold in a segregated account,
securities acquired by the Fund under a repurchase agreement. Repurchase
agreements are considered by the staff of the Securities and Exchange
Commission to be loans by the Fund that enters into them. In an attempt to
reduce the risk of incurring a loss on a repurchase agreement, a Fund will
enter into repurchase agreements only with domestic banks with total assets
in excess of one billion dollars or primary government securities dealers
reporting to the Federal Reserve Bank of New York, with respect to
securities of the type in which the Fund may invest, and will require that
additional securities be deposited with it if the value of the securities
purchased should decrease below resale price. The Manager will monitor on
an ongoing basis the value of the collateral to assure that it always
equals or exceeds the repurchase price. Certain costs may be incurred by
the Fund in connection with the sale of the securities if the seller does
not repurchase them in accordance with the repurchase agreement. In
addition, if bankruptcy proceedings are commenced with respect to the
seller of the securities, realization on the securities by the Fund may be
delayed or limited. Each Fund will consider on an ongoing basis the
creditworthiness of the institutions with which it enters into repurchase
agreements.
Risk Factors
Lower Rated Bonds. This section applies only to the Longer Term
Funds. Lower rated bonds as described herein are not eligible investments
for the Money Market Fund. Each Longer Term Fund is permitted to invest in
securities rated below Baa by Moody's and below BBB by S&P or Fitch. Such
bonds, though higher yielding, are characterized by risk. See in the
Prospectus "Investment Objective and Management Policies--Risk
Factors--Lower Rated Bonds" for a discussion of certain risks and "Appendix
B" for a general description of Moody's, S&P and Fitch ratings of Municipal
Obligations. Although ratings may be useful in evaluating the safety of
interest and principal payments, they do not evaluate the market value risk
of these bonds. Each Fund will rely on the Manager's judgment, analysis
and experience in evaluating the creditworthiness of an issuer. In this
evaluation, the Manager will take into consideration, among other things,
the issuer's financial resources, its sensitivity to economic conditions
and trends, the quality of the issuer's management and regulatory matters.
It also is possible that a rating agency might not timely change the rating
on a particular issue to reflect subsequent events. As stated above, once
the rating of a bond in a Fund's portfolio has been changed, the Manager
will consider all circumstances deemed relevant in determining whether the
Fund should continue to hold the bond.
Investors should be aware that the market values of many of these
bonds tend to be more sensitive to economic conditions than are higher
rated securities. These bonds are considered by Moody's, S&P and Fitch, on
balance, as predominantly speculative with respect to capacity to pay
interest and repay principal in accordance with the terms of the obligation
and generally will involve more credit risk than securities in the higher
rating categories.
Because there is no established retail secondary market for many of
these securities, each Fund anticipates that such securities could be sold
only to a limited number of dealers or institutional investors. To the
extent a secondary trading market for these bonds does exist, it generally
is not as liquid as the secondary market for higher rated securities. The
lack of a liquid secondary market may have an adverse impact on market
price and yield and a Fund's ability to dispose of particular issues when
necessary to meet its liquidity needs or in response to a specific economic
event such as a deterioration in the creditworthiness of the issuer. The
lack of a liquid secondary market for certain securities also may make it
more difficult for a Fund to obtain accurate market quotations for purposes
of valuing its portfolio and calculating its net asset value. Adverse
publicity and investor perceptions, whether or not based on fundamental
analysis, may decrease the values and liquidity of these securities. In
such cases, judgment may play a greater role in valuation because less
reliable, objective data may be available.
These bonds may be particularly susceptible to economic downturns. It
is likely that any economic recession could severely disrupt the market for
such securities and may have an adverse impact on the value of such
securities. In addition, it is likely that any such economic downturn
could adversely affect the ability of the issuers of such securities to
repay principal and pay interest thereon and increase the incidence of
default of such securities.
Each Fund may acquire these bonds during an initial offering. Such
securities may involve special risks because they are new issues. Neither
Fund has any arrangements with the Distributor or any other persons
concerning the acquisition of such securities, and the Manager will review
carefully the credit and other characteristics pertinent to such new
issues.
Lower rated zero coupon securities, in which each Fund may invest up
to 5% of its respective total assets, involve special consideration. The
credit risk factors pertaining to lower rated securities also apply to
lower rated zero coupon bonds. Such zero coupon bonds carry an additional
risk in that, unlike bonds which pay interest throughout the period to
maturity, a Fund will realize no cash until the cash payment date unless a
portion of such securities are sold and, if the issuer defaults, the Fund
may obtain no return at all on its investment. See "Dividends,
Distributions and Taxes."
Investing in New York Municipal Obligations. Each investor should
consider carefully the special risks inherent in the investment in New York
Municipal Obligations by each Fund. These risks result from the financial
condition of New York State and certain of its public bodies and
municipalities, including New York City. Beginning in early 1975, New York
State, New York City and other State entities faced serious financial
difficulties which jeopardized the credit standing and impaired the
borrowing abilities of such entities and contributed to high interest rates
on, and lower market prices for, debt obligations issued by them. A
recurrence of such financial difficulties or a failure of certain financial
recovery programs could result in defaults or declines in the market values
of various New York Municipal Obligations in which the Fund may invest. If
there should be a default or other financial crisis relating to New York
State, New York City, a State or City agency, or a State municipality, the
market value and marketability of outstanding New York Municipal
Obligations in the Fund's portfolio and the interest income to the Fund
could be adversely affected. Moreover, the national recession and the
significant slowdown in the New York and regional economies in the early
1990s added substantial uncertainty to estimates of the State's tax
revenues, which, in part, caused the State to incur cash-basis operating
deficits in the General Fund and issue deficit notes during the fiscal
periods 1989 through 1992. The State's financial operations have improved,
however, during recent fiscal years. After reflecting a 1993 year-end
deposit to the refund reserve account of $671 million, reported 1993
General Fund receipts were $45 million higher than originally projected in
April 1992. The State completed the 1994 and 1995 fiscal years with
operating surpluses of $914 million and $158 million, respectively. There
can be no assurance that New York will not face substantial potential
budget gaps in future years. In January 1992, Moody's lowered from A to
Baa1 the ratings on certain appropriation-backed debt of New York State and
its agencies. The State's general obligation, state guaranteed and New
York State Local Government Assistance Corporation bonds continue to be
rated A by Moody's. In January 1992, S&P lowered from A to A- the ratings
of New York State general obligation bonds and stated that it continued to
assess the ratings outlook as negative. The ratings of various agency
debt, state moral obligations, contractual obligations, lease purchase
obligations and state guarantees also were lowered. In February 1991,
Moody's lowered its rating on New York City's general obligation bonds from
A to Baa1 and in July 1995, S&P lowered its rating on such bonds from A- to
BBB+. The rating changes reflect the rating agencies' concerns about the
financial condition of New York State and City, the heavy debt load of the
State and City, and economic uncertainties in the region. Investors should
review "Appendix A" which more fully sets forth these and other risk
factors.
Investment Restrictions
Money Market Fund. The Money Market Fund has adopted investment
restrictions numbered 1 through 9 as fundamental policies, which cannot be
changed without approval by the holders of a majority (as defined in the
Investment Company Act of 1940 (the "Act")) of the Money Market Fund's
outstanding voting shares. Investment restrictions numbered 10 and 11 are
non-fundamental policies and may be changed by a vote of a majority of the
Money Market Fund's Board members at any time. The Money Market Fund may
not:
1. Purchase securities other than Municipal Obligations and
Taxable Investments as those terms are defined above and
in the Prospectus.
2. Borrow money, except from banks for temporary or emergency (not
leveraging) purposes in an amount up to 15% of the value of the
Fund's total assets (including the amount borrowed) based on
the lesser of cost or market, less liabilities (not including
the amount borrowed) at the time the borrowing is made. While
borrowings of the Money Market Fund exceed 5% of the value of
the Money Market Fund's total assets, it will not make any
additional investments.
3. Sell securities short or purchase securities on margin.
4. Underwrite the securities of other issuers, except that the
Money Market Fund may bid separately or as part of a group for
the purchase of Municipal Obligations directly from an issuer
for its own portfolio to take advantage of the lower purchase
price available.
5. Purchase or sell real estate, real estate investment trust
securities, commodities or commodity contracts, or oil and gas
interests, but this shall not prevent the Fund from investing
in Municipal Obligations secured by real estate or interests
therein.
6. Make loans to others except through the purchase of qualified
debt obligations and the entry into repurchase agreements
referred to above and in the Prospectus.
7. Invest more than 25% of its total assets in the securities of
issuers in any single industry; provided that there shall be
no such limitation on the purchase of Municipal Obligations
and, for temporary defensive purposes, securities issued by
domestic banks and obligations issued or guaranteed by the
U.S. Government, its agencies or instrumentalities.
8. Purchase more than 10% of the voting securities of any issuer
or invest in companies for the purpose of exercising control.
9. Invest in securities of other investment companies, except as
they may be acquired as part of a merger, consolidation or
acquisition of assets.
10. Pledge, hypothecate, mortgage or otherwise encumber its assets,
except to the extent necessary to secure permitted borrowings.
11. Enter into repurchase agreements providing for settlement
in more than seven days after notice or purchase securities
which are illiquid, if, in the aggregate, more than 10% of
the value of the Fund's net assets would be so invested.
Intermediate Bond Fund and Bond Fund. Each Longer Term Fund has
adopted investment restrictions numbered 1 through 7 as fundamental
policies, which cannot be changed, as to a Fund, without approval by the
holders of a majority (as defined in the Act) of such Fund's outstanding
voting shares. Investment restrictions numbered 8 through 12 are non-
fundamental policies and may be changed, as to a Longer Term Fund, by vote
of a majority of such Fund's Board members at any time. Neither Longer
Term Fund may:
1. Invest more than 25% of its total assets in the securities
of issuers in any single industry; provided that there shall
be no such limitation on the purchase of Municipal Obligations
and, for temporary defensive purposes, securities issued by
domestic banks and obligations issued or guaranteed by the U.S.
Government, its agencies or instrumentalities.
2. Borrow money, except to the extent permitted under the Act
(which currently limits borrowing to no more than 33-1/3% of
the value of the Fund's total assets). For purposes of this
investment restriction, the entry into options, forward
contracts, futures contracts, including those relating to
indices, and options on futures contracts or indices shall not
constitute borrowing.
3. Purchase or sell real estate, commodities or commodity
contracts, or oil and gas interests, but this shall not
prevent the Fund from investing in Municipal Obligations
secured by real estate or interests therein, or prevent the
Fund from purchasing and selling options, forward contracts,
futures contracts, including those relating to indices, and
options on futures contracts or indices.
4. Underwrite the securities of other issuers, except that the
Fund may bid separately or as part of a group for the
purchase of Municipal Obligations directly from an issuer for
its own portfolio to take advantage of the lower purchase
price available, and except to the extent the Fund may be
deemed an underwriter under the Securities Act of 1933, as
amended, by virtue of disposing of portfolio securities.
5. Make loans to others, except through the purchase of debt
obligations and the entry into repurchase agreements;
however, the Fund may lend its portfolio securities in an
amount not to exceed 33 1/3% of the value of its total assets.
Any loans of portfolio securities will be made according to
guidelines established by the Securities and Exchange
Commission and the Fund's Board.
6. Issue any senior security (as such term is defined in
Section 18(f) of the Act), except to the extent that the
activities permitted in Investment Restrictions numbered 2, 3
and 10 may be deemed to give rise to a senior security.
7. Sell securities short or purchase securities on margin, but
the Fund may make margin deposits in connection with
transactions in options, forward contracts, futures
contracts, including those relating to indices, and options
on futures contracts or indices.
8. Purchase securities other than Municipal Obligations and
Taxable Investments and those arising out of transactions in
futures and options or as otherwise provided in the
Prospectus.
9. Invest in securities of other investment companies, except to
the extent permitted under the Act.
10. Pledge, hypothecate, mortgage or otherwise encumber its
assets, except to the extent necessary to secure permitted
borrowings and to the extent related to the deposit of assets
in escrow in connection with the purchase of securities on a
when-issued or delayed-delivery basis and collateral and
initial or variation margin arrangements with respect to
options, futures contracts, including those related to
indices, and options on futures contracts or indices.
11. Enter into repurchase agreements providing for settlement in
more than seven days after notice or purchase securities
which are illiquid (which securities could include
participation interests (including municipal lease/purchase
agreements) that are not subject to the demand feature
described in the Prospectus, and floating and variable rate
demand obligations as to which the Fund cannot exercise the
demand feature as described in the Prospectus on less than
seven days' notice and as to which there is no secondary
market), if, in the aggregate, more than 15% of its net
assets would be so invested.
12. Invest in companies for the purpose of exercising control.
All Funds - For purposes of Investment Restriction No. 7 with respect
to the Money Market Fund, and Investment Restriction No. 1 with respect to
the Longer Term Funds, industrial development bonds, where the payment of
principal and interest is the ultimate responsibility of companies within
the same industry, are grouped together as an "industry." If a percentage
restriction is adhered to at the time of investment, a later increase or
decrease in percentage resulting from a change in values or assets will not
constitute a violation of such restriction.
Each Fund may make commitments more restrictive than the respective
restrictions listed above so as to permit the sale of such Fund's shares in
certain states. Should any Fund determine that a commitment is no longer
in the best interest of such Fund and its shareholders, it reserves the
right to revoke the commitment by terminating the sale of its shares in the
state involved.
MANAGEMENT OF THE FUNDS
Trustees and officers of the Money Market Fund and Intermediate Bond
Fund, and Directors and officers of the Bond Fund, together with
information as to their principal business occupations during at least the
last five years, are shown below. Each Board member who is deemed to be an
"interested person" of the Funds, as defined in the Act, is indicated by an
asterisk.
Trustees/Directors of the Funds
*JOSEPH S. DiMARTINO, Chairman of the Board. Since January 1995, Chairman
of the Board of various funds in the Dreyfus Family of Funds. For
more than five years prior thereto, he was President, a director and,
until August 1994, Chief Operating Officer of the Manager and
Executive Vice President and a director of Dreyfus Service
Corporation, a wholly-owned subsidiary of the Manager and, until
August 24, 1994, each Fund's distributor. From August 1994 to
December 31, 1994, he was a director of Mellon Bank Corporation. He
is Chairman of the Board of Noel Group, Inc., a venture capital
company; a trustee of Bucknell University; and a director of the
Muscular Dystrophy Association, HealthPlan Services Corporation,
Belding Heminway Company, Inc., a manufacturer and marketer of
industrial threads, specialty yarns, home furnishings and fabrics,
Curtis Industries, Inc., a national distributor of security products,
chemicals and automotive and other hardware, Simmons Outdoor
Corporation and Staffing Resources, Inc.. He is 51 years old and his
address is 200 Park Avenue, New York, New York 10166.
*DAVID W. BURKE, Director/Trustee. Consultant to the Manager since August
1994. From October 1990 to August 1994, Vice President and Chief
Administrative Officer of the Manager. From 1977 to 1990, Mr. Burke
was involved in the management of national television news, as Vice
President and Executive Vice President of ABC News, and subsequently
as President of CBS News. He is 59 years old and his address is 200
Park Avenue, New York, New York 10166.
SAMUEL CHASE, Director/Trustee. Since 1982, President of Samuel Chase &
Company, Ltd., and from 1983 to 1990, Chairman of Chase, Brown &
Blaxall, Inc., economic consulting firms. He is 63 years old and his
address is 4410 Massachusetts Avenue, N.W., Suite 408, Washington,
D.C. 20016.
GORDON J. DAVIS, Director/Trustee. Since October 1994, Mr. Davis has been
a senior partner with the law firm of LeBoeuf, Lamb, Greene & MacRae.
From 1983 to September 1994, Mr. Davis was a senior partner with the
law firm of Lord Day & Lord, Barrett Smith. From 1978 to 1983, he was
Commissioner of Parks and Recreation for the City of New York. He is
also a director of Consolidated Edison, a utility company, and Phoenix
Home Life Insurance Company and a member of various other corporate
and not-for-profit boards. He is 54 years old and his address is 241
Central Park West, New York, New York 10023.
JONI EVANS, Director/Trustee. Senior Vice President of the William Morris
Agency. From September 1987 to May 1993, Executive Vice President of
Random House, Inc. and, from January 1991 to May 1993, President and
Publisher of Turtle Bay Books; from January 1987 to December 1990,
Publisher of Random House--Adult Trade Division; and from 1985 to
1987, President of Simon & Schuster--Trade Division. She is 53 years
old and her address is 1325 Avenue of the Americas, 16th Floor, New
York, New York 10019.
ARNOLD S. HIATT, Director/Trustee. Chairman of the Stride Rite Foundation.
From 1969 to June 1992, Chairman of the Board, President or Chief
Executive Officer of The Stride Rite Corporation, a multidivisional
footwear manufacturing and retailing company. Mr. Hiatt is also a
Director of the Cabot Corporation. He is 68 years old and his address
is 400 Atlantic Avenue, Boston, Massachusetts 02110.
DAVID J. MAHONEY, Director/Trustee. President of David Mahoney Ventures
since 1983. From 1968 to 1983, he was Chairman and Chief Executive
Officer of Norton Simon, Inc., a producer of consumer products and
services. Mr. Mahoney is also a director of Bionaire Inc. and
Intercostal Health Systems, Inc. He is 72 years old and his address
is 745 Fifth Avenue, Suite 700, New York, New York 10151.
BURTON N. WALLACK, Director/Trustee. President and co-owner of Wallack
Management Company, a real estate management company managing real
estate in the New York City area. He is 44 years old and his address
is 18 East 64th Street, Suite 3D, New York, New York 10021.
Each so long as the Service Plan of the Intermediate Bond Fund, or the
Shareholder Services Plan of the Money Market Fund or Bond Fund,
respectively, described in the section captioned "Service Plan and
Shareholder Services Plans" remain in effect, the Board members of such
Fund who are not "interested persons" of the Fund, as defined in the Act,
will be selected and nominated by the Board members who are not "interested
persons" of such Fund.
Each Fund typically pays its Board members an annual retainer and a
per meeting fee and reimburses them for their expenses. The Chairman of
the Board receives an additional 25% of such compensation. The aggregate
amount of compensation paid to each Board member by each Fund for the
fiscal year ended May 31, 1995, and by all other funds in the Dreyfus
Family of Funds for which such person is a Board member (the number of
which is set forth in parenthesis next to each Board members total
compensation) for the year ended December 31, 1994, is as follows:
<TABLE>
<CAPTION>
Money Market Fund
(5)
(3) Total Compensation
(2) Pension or (4) From Fund and
(1) Aggregate Retirement Benefits Estimated Annual From Fund Complex
Name of Board Compensation from Accrued as Part of Benefits Upon Paid to Board
Member Fund* Fund's Expenses Retirement Member
- ------------ ----------------- ------------------- ---------------- ----------------
<S> <C> <C> <C> <C>
Joseph S. DiMartino $3,125 none none $445,000** (93)
David W. Burke $2,245 none none $ 27,898 (51)
Samuel Chase $2,750 none none $ 46,250 (13)
Gordon J. Davis $ 505 none none $ 29,602 (24)
Joni Evans $2,500 none none $ 46,250 (13)
Arnold S. Hiatt $2,750 none none $ 42,750 (13)
David J. Mahoney $2,250 none none $ 43,000 (13)
Burton N. Wallack $2,750 none none $ 46,250 (13)
_____________________
* Amount does not include reimbursed expenses for attending Board
meetings, which amounted to $317 for all Trustees as a group.
** Estimated amount for the year ending December 31, 1995.
</TABLE>
<TABLE>
<CAPTION>
Intermediate Bond Fund
(5)
(3) Total Compensation
(2) Pension or (4) From Fund and
(1) Aggregate Retirement Benefits Estimated Annual From Fund Complex
Name of Board Compensation from Accrued as Part of Benefits Upon Paid to Board
Member Fund* Fund's Expenses Retirement Member
- ------------ ----------------- ------------------- ---------------- ----------------
<S> <C> <C> <C> <C>
Joseph S. DiMartino $5,625 none none $445,000** (93)
David W. Burke $4,075 none none $ 27,898 (51)
Samuel Chase $5,000 none none $ 46,250 (13)
Gordon J. Davis $ 925 none none $ 29,602 (24)
Joni Evans $4,500 none none $ 46,250 (13)
Arnold S. Hiatt $5,000 none none $ 42,750 (13)
David J. Mahoney $4,000 none none $ 43,000 (13)
Burton N. Wallack $5,000 none none $ 46,250 (13)
_____________________
* Amount does not include reimbursed expenses for attending Board
meetings, which amounted to $411 for all Trustees as a group.
** Estimated amount for the year ending December 31, 1995.
</TABLE>
<TABLE>
<CAPTION>
Bond Fund
(5)
(3) Total Compensation
(2) Pension or (4) From Fund and
(1) Aggregate Retirement Benefits Estimated Annual From Fund Complex
Name of Board Compensation from Accrued as Part of Benefits Upon Paid to Board
Member Fund* Fund's Expenses Retirement Member
- ------------ ----------------- ------------------- ---------------- ----------------
<S> <C> <C> <C> <C>
Joseph S. DiMartino $8,125 none none $445,000** (93)
David W. Burke $5,736 none none $ 27,898 (51)
Samuel Chase $7,000 none none $ 46,250 (13)
Gordon J. Davis $1,264 none none $ 29,602 (24)
Joni Evans $6,500 none none $ 46,250 (13)
Arnold S. Hiatt $7,000 none none $ 42,750 (13)
David J. Mahoney $6,000 none none $ 43,000 (13)
Burton N. Wallack $7,000 none none $ 46,250 (13)
_____________________
* Amount does not include reimbursed expenses for attending Board
meetings, which amounted to $458 for all Directors as a group.
** Estimated amount for the year ending December 31, 1995.
</TABLE>
Officers of the Fund
MARIE E. CONNOLLY, President and Treasurer. President and Chief Operating
Officer of the Distributor and an officer of other investment
companies advised or administered by the Manager. From December 1991
to July 1994, she was President and Chief Compliance Officer of Funds
Distributor, Inc., the ultimate parent company of which is Boston
Institutional Group, Inc. Prior to December 1991, she served as Vice
President and Controller, and later as Senior Vice President, of The
Boston Company Advisors, Inc. She is 37 years old.
JOHN E. PELLETIER, Vice President and Secretary. Senior Vice President and
General Counsel of the Distributor and an officer of other investment
companies advised or administered by the Manager. From February 1992
to July 1994, he served as Counsel for The Boston Company Advisors,
Inc. From August 1990 to February 1992, he was employed as an
Associate at Ropes & Gray. He is 30 years old.
ERIC B. FISCHMAN, Vice President and Assistant Secretary. Associate
General Counsel of the Distributor and an officer of other investment
companies advised or administered by the Manager. From September 1992
to August 1994, he was an attorney with the Board of Governors of the
Federal Reserve System. He is 30 years old.
FREDERICK C. DEY, Vice President and Assistant Treasurer. Senior Vice
President of the Distributor and an officer of other investment
companies advised or administered by the Manager. From 1988 to August
1994, he was manager of the High Performance Fabric Division of
Springs Industries Inc. He is 33 years old.
JOSEPH S. TOWER, III, Assistant Treasurer. Senior Vice President,
Treasurer and Chief Financial Officer of the Distributor and an
officer of other investment companies advised or administered by the
Manager. From July 1988 to August 1994, he was employed by The Boston
Company, Inc. where he held various management positions in the
Corporate Finance and Treasury areas. He is 32 years old.
JOHN J. PYBURN, Assistant Treasurer. Assistant Treasurer of the
Distributor and an officer of other investment companies advised or
administered by the Manager. From 1984 to July 1994, he was Assistant
Vice President in the Mutual Fund Accounting Department of the
Manager. He is 59 years old.
RUTH D. LEIBERT, Assistant Secretary. Assistant Vice President of the
Distributor and an officer of other investment companies advised or
administered by the Manager. From March 1992 to July 1994, she was a
Compliance Officer for The Managers Funds, a registered investment
company. From March 1990 until September 1991, she was Development
Director of The Rockland Center for the Arts. She is 50 years old.
The address of each officer of the Fund is 200 Park Avenue, New York,
New York 10166.
Board members and officers of each Fund, as a group, owned less than
1% of such Fund's shares of Common Stock outstanding as of August 15, 1995.
MANAGEMENT AGREEMENTS
The following information supplements and should be read in
conjunction with the section in the Prospectus entitled "Management of the
Funds."
The Manager provides management services pursuant to separate
Management Agreements (respectively, the "Agreement") with each Fund dated
August 24, 1994. As to each Fund, its Agreement is subject to annual
approval by (i) such Fund's Board, or (ii) vote of a majority (as defined
in the Act) of such Fund's outstanding voting securities, provided that in
either event the continuance of the Agreement also is approved by a
majority of such Fund's Board members who are not "interested persons" (as
defined in the Act) of the Fund or of the Manager, by vote cast in person
at a meeting called for the purpose of voting on such approval. Each
Agreement was approved by shareholders on August 2, 1994, and was last
approved by each Fund's Board, including a majority of the Board members
who are not "interested persons" of any party to the Agreement, at a
meeting held on April 26, 1995. As to each Fund, the Agreement is
terminable without penalty, on 60 days' notice, by such Fund's Board or by
vote of the holders of a majority of its shares, or, upon not less than 90
days' notice, by the Manager. Each Agreement will terminate automatically,
as to the relevant Fund, in the event of its assignment (as defined in the
Act).
The following persons are officers and/or directors of the Manager:
Howard Stein, Chairman of the Board and Chief Executive Officer; W. Keith
Smith, Vice Chairman of the Board; Robert E. Riley, President, Chief
Operating Officer and a director; Stephen E. Canter, Vice Chairman, Chief
Investment Officer and a director; Lawrence S. Kash, Vice Chairman--
Distribution and a director; Philip L. Toia, Vice Chairman--Operations and
Administration; Barbara E. Casey, Vice President--Dreyfus Retirement
Services; Diane Coffey, Vice President--Corporate Communications; Elie M.
Genadry, Vice President--Institutional Sales; William F. Glavin, Jr., Vice
President--Corporate Development; Henry D. Gottmann, Vice President--Retail
Sales and Service; Mark N. Jacobs, Vice President--Fund Legal and
Compliance and Secretary; Daniel C. Maclean, Vice President and General
Counsel; Jeffrey N. Nachman, Vice President--Mutual Fund Accounting; Andrew
S. Wasser, Vice President--Information Services; Katherine C. Wickham, Vice
President--Human Resources; Maurice Bendrihem, Controller; Elvira Oslapas,
Assistant Secretary; and Mandell L. Berman, Frank V. Cahouet, Alvin E.
Friedman, Lawrence M. Greene, Julian M. Smerling and David B. Truman,
directors.
The Manager manages each Fund's portfolio of investments in accordance
with the stated policies of the Fund, subject to the approval of the Fund's
Board. The Manager is responsible for investment decisions and provides
each Fund with portfolio managers who are authorized by its Board to
execute purchases and sales of securities. Each Fund's portfolio managers
are Richard J. Moynihan, Joseph P. Darcy, A. Paul Disdier, Karen M. Hand,
Stephen C. Kris, Jill C. Shaffro, L. Lawrence Troutman, Samuel J. Weinstock
and Monica S. Wieboldt. The Manager also maintains a research department
with a professional staff of portfolio managers and securities analysts who
provide research services for each Fund as well as for other funds advised
by the Manager. All purchases and sales are reported for the respective
Board's review at the meeting subsequent to such transactions.
All expenses incurred in the operation of a Fund are borne by that
Fund, except to the extent specifically assumed by the Manager. The
expenses borne by each Fund include: taxes, interest, brokerage fees and
commissions, if any, fees of Board members who are not officers, directors,
employees or holders of 5% or more of the outstanding voting securities of
the Manager, Securities and Exchange Commission fees, state Blue Sky
qualification fees, advisory fees, charges of custodians, transfer and
dividend disbursing agents' fees, certain insurance premiums, industry
association fees, outside auditing and legal expenses, costs of maintaining
the Fund's existence, costs of independent pricing services, costs
attributable to investor services (including, without limitation, telephone
and personnel expenses), costs of shareholders' reports and meetings, costs
of preparing and printing prospectuses and statements of additional
information for regulatory purposes and distribution to existing
shareholders, and any extraordinary expenses. Pursuant to the Service Plan
of the Intermediate Bond Fund, such Fund bears expenses for advertising,
marketing and distributing the Fund's shares and servicing shareholder
accounts. Pursuant to separate Shareholder Services Plans, the Money
Market Fund and Bond Fund bear certain allocated expenses for shareholder
servicing. See "Service Plan and Shareholder Services Plans."
The Manager maintains office facilities on behalf of each Fund, and
furnishes statistical and research data, clerical help, accounting, data
processing, bookkeeping and internal auditing and certain other required
services to each Fund. The Manager also may make such advertising and
promotional expenditures, using its own resources, as it from time to time
deems appropriate.
As compensation for the Manager's services, the Money Market Fund has
agreed to pay the Manager a monthly management fee at the annual rate of
.50 of 1% of the value of the Fund's average daily net assets. As
compensation for the Manager's services, each Longer Term Fund has agreed
to pay the Manager a monthly management fee at the annual rate of .60 of 1%
of the value of its average daily net assets. All fees and expenses for
each Fund are accrued daily and deducted before the declaration of
dividends to investors. Set forth below are the total amounts paid by each
Fund to the Manager for each of the last three fiscal years of the Funds:
Amount Paid by Amount Paid
Fiscal Year Money Market by Intermediate Amount Paid by
Ended May 31, Fund Bond Fund Bond Fund
1995 $ 1,636,701 $2,204,128 $10,933,374
1994 $ 1,769,463 $2,038,931* $12,540,757
1993 $ 1,984,999 $1,058,358* $11,974,650
________________
* Reflects the reduction in management fees of $303,115 and $350,689 in
1994 and 1993, respectively, pursuant to undertakings by the Manager then
in effect.
The Manager has agreed that if, in any fiscal year, a Fund's aggregate
expenses, exclusive of taxes, brokerage, interest on borrowings and (with
the prior written consent of the necessary state securities commissions)
extraordinary expenses, but including the management fee, exceed 1 1/2% of the
value of such Fund's average net assets for the fiscal year, the Fund may
deduct from the payment to be made to the Manager under the Agreement, or
the Manager will bear, the excess expense. Such deduction or payment, if
any, will be estimated daily, and reconciled and effected or paid, as the
case may be, on a monthly basis.
The aggregate of the fees payable to the Manager by a Fund is not
subject to reduction as the value of such Fund's net assets increase.
PURCHASE OF SHARES
The following information supplements and should be read in
conjunction with the section in the Prospectus entitled "How to Buy
Shares."
The Distributor. The Distributor serves as each Fund's distributor
pursuant to separate agreements, each of which is renewable annually. The
Distributor also acts as distributor for the other funds in the Dreyfus
Family of Funds and for certain other investment companies. In some
states, banks or other financial institutions effecting transactions in a
Fund's shares may be required to register as dealers pursuant to state law.
Dreyfus TeleTransfer Privilege. Dreyfus TeleTransfer purchase orders
may be made between the hours of 8:00 a.m. and 4:00 p.m., New York time, on
any business day that The Shareholder Services Group, Inc., each Fund's
transfer and dividend disbursing agent (the "Transfer Agent"), and the New
York Stock Exchange are open. Such purchases will be credited to the
shareholder's particular Fund account on the Transfer Agent's next business
day. To qualify to use the Dreyfus TeleTransfer Privilege, the initial
payment for purchase of Fund shares must be drawn on, and redemption
proceeds paid to, the same bank and account as are designated on the
Account Application or Shareholder Services Form on file. If the proceeds
of a particular redemption are to be wired to an account at any other bank,
the request must be in writing and signature-guaranteed. See "Redemption
of Shares--Dreyfus TeleTransfer Privilege."
Using Federal Funds. The following information is applicable only to
shares of the Money Market Fund. The Transfer Agent or the Money Market
Fund may attempt to notify the investor upon receipt of checks drawn on
banks that are not members of the Federal Reserve System as to the possible
delay in conversion into Federal Funds and may attempt to arrange for a
better means of transmitting the money. If the investor is a customer of a
securities dealer ("Selected Dealer") and his order to purchase Money
Market Fund shares is paid for other than in Federal Funds, the Selected
Dealer, acting on behalf of its customer, will complete the conversion
into, or itself advance, Federal Funds generally on the business day
following receipt of the customer order. The order is effective only when
so converted and received by the Transfer Agent. An order for the purchase
of Money Market Fund shares placed by an investor with sufficient Federal
Funds or cash balance in his brokerage account with a Selected Dealer will
become effective on the day that the order, including Federal Funds, is
received by the Transfer Agent.
Reopening an Account. An investor may reopen an account in any of the
Funds with a minimum investment of $100 without filing a new Account
Application during the calendar year the account is closed or during the
following calendar year, provided the information on the old Account
Application is still applicable.
SERVICE PLAN AND SHAREHOLDER SERVICES PLANS
The following information supplements and should be read in
conjunction with the section in the Prospectus entitled "Service Plan and
Shareholder Services Plans."
The Intermediate Bond Fund has adopted a Service Plan pursuant to Rule
12b-1 under the Act and the Money Market Fund and Bond Fund have adopted
separate Shareholder Services Plans.
Service Plan (Intermediate Bond Fund only). Rule l2b-1 (the "Rule")
adopted by the Securities and Exchange Commission under the Act provides,
among other things, that an investment company may bear expenses of
distributing its shares only pursuant to a plan adopted in accordance with
the Rule. The Intermediate Bond Fund's Board has adopted such a plan (the
"Service Plan"), pursuant to which the Intermediate Bond Fund (a)
reimburses the Distributor for payments to certain financial institutions
(which may include banks), securities dealers and other financial industry
professionals (collectively, "Service Agents") for distributing the
Intermediate Bond Fund 's shares and servicing shareholder accounts
("Servicing") and (b) pays the Manager, Dreyfus Service Corporation and any
affiliates of either of them (collectively, "Dreyfus") for advertising and
marketing relating to the Intermediate Bond Fund and for Servicing. The
Intermediate Bond Fund's Board believes that there is a reasonable
likelihood that the Service Plan adopted will benefit the Fund and its
shareholders.
A quarterly report of the amounts expended under the Service Plan, and
the purposes for which such expenditures were incurred, must be made to the
Intermediate Bond Fund's Board for its review. In addition, the Service
Plan provides that it may not be amended to increase materially the costs
which the Fund may bear for distribution pursuant to the Service Plan
without shareholder approval and that other material amendments of the
Service Plan must be approved by the Board, and by the Board members who
are not "interested persons" (as defined in the Act) of the Fund or the
Manager and have no direct or indirect financial interest in the operation
of the Service Plan or in the related service agreements, by vote cast in
person at a meeting called for the purpose of considering such amendments.
The Service Plan and the related service agreements are subject to annual
approval by such vote of the Board members cast in person at a meeting
called for the purpose of voting on the Service Plan. The Service Plan was
last so approved at a meeting held on April 26, 1995. The Service Plan is
terminable at any time by vote of a majority of the Intermediate Bond
Fund's Board members who are not "interested persons" and have no direct or
indirect financial interest in the operation of the Service Plan or in any
of the related service agreements or by vote of the holders of a majority
of such Fund's shares. Any service agreement is terminable without
penalty, at any time, by such vote of the Board members or, upon not more
than 60 days' written notice to the Service Agent, by vote of the holders
of a majority of Intermediate Bond Fund's shares, or, upon 15 days' notice,
by the Distributor. A service agreement will terminate automatically in
the event of its assignment (as defined in the Act).
Under the Service Plan, for the period August 24, 1994 (effective date
of the Service Plan) through May 31, 1995, the total amount payable by the
Intermediate Bond Fund was $693,480, of which $690,181 was payable to
Dreyfus for advertising and marketing and for servicing shareholder
accounts, and $3,299 was payable by the Intermediate Bond Fund for
preparing, printing and distributing prospectuses and statements of
additional information and for costs associated with implementing and
operating the Service Plan.
Prior Service Plan. As of August 24, 1994, the Intermediate Bond Fund
terminated its then existing service plan which provided for payments to be
made to Dreyfus Service Corporation, the Fund's distributor prior to such
date, for advertising, marketing and distributing Intermediate Bond Fund
shares at an annual rate of .25% of the value of the Intermediate Bond
Fund's average daily net assets. For the period June 1, 1994 through
August 24, 1994, the total amount charged to the Intermediate Bond Fund
under such plan was $229,333, of which $228,206 was charged for
advertising, marketing and servicing the Intermediate Bond Fund's shares
and $1,127 was charged for preparing, printing and distributing
prospectuses and statements of additional information and operating the
plan.
Shareholder Services Plans. (Money Market Fund and Bond Fund only).
The Money Market Fund and the Bond Fund each have adopted a separate
Shareholder Services Plan, pursuant to which each Fund reimburses Dreyfus
Service Corporation for certain allocated expenses for the provision of
certain services to such Fund's shareholders. 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.
A quarterly report of the amounts expended under the Shareholder
Services Plan, and the purposes for which such expenditures were incurred,
must be made to the respective Fund's Board for its review. In addition,
the Shareholder Services Plan provides that it may not be amended without
approval of the Board, and by the Board members who are not "interested
persons" (as defined in the Act) of the Fund and have no direct or indirect
financial interest in the operation of the Shareholder Services Plan, by
vote cast in person at a meeting called for the purpose of considering such
amendments. The Shareholder Services Plan is subject to annual approval by
such vote of the Board members cast in person at a meeting called for the
purpose of voting on the Shareholder Services Plan. Each Shareholder
Services Plan was so approved on April 26, 1995. The Shareholder Services
Plan is terminable at any time by vote of a majority of the Board members
who are not "interested persons" and who have no direct or indirect
financial interest in the operation of the Shareholder Services Plan.
For the fiscal year ended May 31, 1995, the Money Market Fund paid
$189,289, and the Bond Fund paid $904,669, pursuant to the Fund's
Shareholder Services Plan.
REDEMPTION OF SHARES
The following information supplements and should be read in
conjunction with the section in the Prospectus entitled "How to Redeem
Shares."
Check Redemption Privilege. An investor may indicate on the Account
Application or by later written request that the Fund provide Redemption
Checks ("Checks") drawn on the Fund's account. Checks will be sent only to
the registered owner(s) of the account and only to the address of record.
The Account Application or later written request must be manually signed by
the registered owner(s). Checks may be made payable to the order of any
person in an amount of $500 or more. When a Check is presented to the
Transfer Agent for payment, the Transfer Agent, as the investor's agent,
will cause the Fund to redeem a sufficient number of full or fractional
shares in the investor's account to cover the amount of the Check.
Dividends are earned until the Check clears. After clearance, a copy of
the Check will be returned to the investor. Investors generally will be
subject to the same rules and regulations that apply to checking accounts,
although election of this Privilege creates only a shareholder-transfer
agent relationship with the Transfer Agent.
If the amount of the Check is greater than the value of the shares in
an investor's account, the Check will be returned marked insufficient
funds. Checks should not be used to close an account.
Wire Redemption Privilege. By using this Privilege, the investor
authorizes the Transfer Agent to act on wire or telephone redemption
instructions from any person representing himself or herself to be the
investor or the investor's Service Agent, and reasonably believed by the
Transfer Agent to be genuine. Ordinarily, the Money Market Fund will
initiate payment for shares redeemed pursuant to this Privilege on the same
business day if the Transfer Agent receives the redemption request in
proper form prior to Noon on such day; otherwise the Money Market Fund will
initiate payment on the next business day. The Longer Term Funds
ordinarily will initiate payment for shares redeemed pursuant to this
privilege on the next business day after receipt by the Transfer Agent of a
redemption request in proper form. Redemption proceeds will be transferred
by Federal Reserve wire only to the commercial bank account specified by
the investor on the Account Application or Shareholder Services Form.
Redemption proceeds, if wired, must be in the amount of $1,000 or more and
will be wired to the investor's account at the bank of record designated in
the investor's file at the Transfer Agent, if the investor's bank is a
member of the Federal Reserve System, or to a correspondent bank if the
investor's bank is not a member. Fees ordinarily are imposed by such bank
and usually are borne by the investor. Immediate notification by the
correspondent bank to the investor's bank is necessary to avoid a delay in
crediting the funds to the investor's bank account.
Investors with access to telegraphic equipment may wire redemption
requests to the Transfer Agent by employing the following transmittal code
which may be used for domestic or overseas transmission:
Transfer Agent's
Transmittal Code Answer Back Sign
144295 144295 TSSG PREP
Investors who do not have direct access to telegraphic equipment may
have the wire transmitted by contacting a TRT Cables operator at
1-800-654-7171, toll free. Investors should advise the operator that the
above transmittal code must be used and should also inform the operator of
the Transfer Agent's answer back sign.
To change the commercial bank or account designated to receive
redemption proceeds, a written request must be sent to the Transfer Agent.
This request must be signed by each shareholder, with each signature
guaranteed as described below under "Share Certificates; Signatures."
Dreyfus TeleTransfer Privilege. Investors should be aware that if
they have selected the Dreyfus TeleTransfer Privilege, any request for a
wire redemption will be effected as a Dreyfus TeleTransfer transaction
through the Automated Clearing House ("ACH") system unless more prompt
transmittal specifically is requested. Redemption proceeds will be on
deposit in the investor's account at an ACH member bank ordinarily two
business days after receipt of the redemption request. See "Purchase of
Shares--Dreyfus TeleTransfer Privilege."
Share Certificates; Signature. Any certificate representing Fund
shares to be redeemed must be submitted with the redemption request.
Written redemption requests must be signed by each shareholder, including
each holder of a joint account, and each signature must be guaranteed.
Signatures on endorsed certificates submitted for redemption also must be
guaranteed. The Transfer Agent has adopted standards and procedures
pursuant to which signature-guarantees in proper form generally will be
accepted from domestic banks, brokers, dealers, credit unions, national
securities exchanges, registered securities associations, clearing agencies
and savings associations, as well as from participants in the New York
Stock Exchange Medallion Signature Program, the Securities Transfer Agents
Medallion Program ("STAMP") and the Stock Exchanges Medallion Program.
Guarantees must be signed by an authorized signatory of the guarantor and
"Signature-Guaranteed" must appear with the signature. The Transfer Agent
may request additional documentation from corporations, executors,
administrators, trustees or guardians, and may accept other suitable
verification arrangements from foreign investors, such as consular
verification. For more information concerning signature-guarantees, please
call one of the telephone numbers listed on the cover.
Redemption Commitment. Each Fund has committed itself to pay in cash
all redemption requests by any shareholder of record, limited in amount
during any 90-day period to the lesser of $250,000 or 1% of the value of
the Fund's net assets at the beginning of such period. Such commitment is
irrevocable without the prior approval of the Securities and Exchange
Commission. In the case of requests for redemption in excess of such
amount, the Board reserves the right to make payments in whole or in part
in securities or other assets in case of an emergency or any time a cash
distribution would impair the liquidity of the Fund to the detriment of the
existing shareholders. In such event, the securities would be valued in
the same manner as the Fund's portfolio is valued. If the recipient sold
such securities, brokerage charges would be incurred.
Suspension of Redemptions. The right of redemption may be suspended
or the date of payment postponed (a) during any period when the New York
Stock Exchange is closed (other than customary weekend and holiday
closings), (b) when trading in the respective markets each Fund ordinarily
utilizes is restricted, or when an emergency exists as determined by the
Securities and Exchange Commission so that disposal of such Fund's
investments or determination of its net asset value is not reasonably
practicable, or (c) for such other periods as the Securities and Exchange
Commission by order may permit to protect the respective Fund's
shareholders.
SHAREHOLDER SERVICES
The following information supplements and should be read in
conjunction with the section in the Prospectus entitled "Shareholder
Services."
Fund Exchanges. Shares of other funds purchased by exchange will be
purchased on the basis of relative net asset value per share as follows:
A. Exchanges for shares of funds that are offered without a
sales load will be made without a sales load.
B. Shares of funds purchased without a sales load may be
exchanged for shares of other funds sold with a sales load,
and the applicable sales load will be deducted.
C. Shares of funds purchased with a sales load may be exchanged
without a sales load for shares of other funds sold without a
sales load.
D. Shares of funds purchased with a sales load, shares of funds
acquired by a previous exchange from shares purchased with a
sales load, and additional shares acquired through
reinvestment of dividends or distributions of any such funds
(collectively referred to herein as "Purchased Shares") may
be exchanged for shares of other funds sold with a sales load
(referred to herein as "Offered Shares"), provided that, if
the sales load applicable to the Offered Shares exceeds the
maximum sales load that could have been imposed in connection
with the Purchased Shares (at the time the Purchased Shares
were acquired), without giving effect to any reduced loads,
the difference will be deducted.
To accomplish an exchange under item D above, shareholders must notify
the Transfer Agent of their prior ownership of fund shares and their
account number.
To request an exchange, the investor, or the investor's Service Agent
acting on the investor's behalf, must give exchange instructions to the
Transfer Agent in writing or by telephone. The ability to issue exchange
instructions by telephone is given to all Fund shareholders automatically,
unless the investor checks the applicable "No" box on the Account
Application, indicating that the investor specifically refuses this
Privilege. By using the Telephone Exchange Privilege, the investor
authorizes the Transfer Agent to act on telephonic instructions from any
person representing himself or herself to be the investor, or a
representative of the investor's Service Agent, and reasonably believed by
the Transfer Agent to be genuine. Telephone exchanges may be subject to
limitations as to the amount involved or number of telephone exchanges
permitted. Shares issued in certificate form are not eligible for
telephone exchanges.
To establish a personal retirement plan by exchange, shares of the
fund being exchanged must have a value of at least the minimum initial
investment required for the fund into which the exchange is being made.
For Dreyfus-sponsored Keogh Plans, IRAs and IRAs set up under a Simplified
Employee Pension Plan ("SEP-IRAs") with only one participant, the minimum
initial investment is $750. To exchange shares held in corporate plans,
403(b)(7) Plans and SEP-IRAs with more than one participant, the minimum
initial investment is $100 if the plan has at least $2,500 invested among
the funds in the Dreyfus Family of Funds. To exchange shares held in
personal retirement plans, the shares exchanged must have a current value
of at least $100.
Dreyfus Auto-Exchange Privilege. Dreyfus Auto-Exchange Privilege
permits an investor to purchase, in exchange for shares of a Fund, shares
of another fund in the Dreyfus Family of Funds. This Privilege is
available only for existing accounts. Shares will be exchanged on the
basis of relative net asset value as described above under "Fund
Exchanges." Enrollment in or modification or cancellation of this
Privilege is effective three business days following notification by the
investor. An investor will be notified if his account falls below the
amount designated to be exchanged under this Privilege. An investor's
account will fall to zero unless additional investments are made in excess
of the designated amount prior to the next Auto-Exchange transaction.
Shares held under IRA and other retirement plans are eligible for this
Privilege. Exchanges of IRA shares may be made between IRA accounts and
from regular accounts to IRA accounts, but not from IRA accounts to regular
accounts. With respect to all other retirement accounts, exchanges may be
made only among those accounts.
Fund Exchanges and the Dreyfus Auto-Exchange Privilege are available
to shareholders resident in any state in which shares of the fund being
acquired may legally be sold. Shares may be exchanged only between
accounts having identical names and other identifying designations.
Shareholder Services Forms and prospectuses of the other funds may be
obtained by calling 1-800-645-6561. Each Fund reserves the right to reject
any exchange request in whole or in part. The Fund Exchanges services or
the Dreyfus Auto-Exchange Privilege may be modified or terminated at any
time by a Fund upon notice to its shareholders.
Automatic Withdrawal Plan. The Automatic Withdrawal Plan permits an
investor with a $5,000 minimum account to request withdrawal of a specified
dollar amount (minimum of $50) on either a monthly or quarterly basis.
Withdrawal payments are the proceeds from sales of Fund shares, not the
yield on the shares. If withdrawal payments exceed reinvested dividends
and distributions, the investor's shares will be reduced and eventually may
be depleted. There is a service charge of $.50 for each withdrawal check.
Automatic Withdrawal may be terminated at any time by the investor, the
Fund or the Transfer Agent. Shares for which certificates have been issued
may not be redeemed through the Automatic Withdrawal Plan.
Dreyfus Dividend Sweep. Dreyfus Dividend Sweep allows investors to
invest on the payment date their dividends or dividends and capital gain
distributions, if any, from a Fund in shares of other eligible funds in the
Dreyfus Family of Funds of which the investor is a shareholder. Shares of
other funds purchased pursuant to the privilege will be purchased on the
basis of relative net asset value per share as follows:
A. Dividends and distributions paid by a fund may be invested
without imposition of a sales load in shares of other funds that
are offered without a sales load.
B. Dividends and distributions paid by a fund which does not charge
a sales load may be invested in shares of other funds sold with a
sales load, and the applicable sales load will be deducted.
C. Dividends and distributions paid by a fund which charges a sales
load may be invested in shares of other funds sold with a sales
load (referred to herein as "Offered Shares"), provided that, if
the sales load applicable to the Offered Shares exceeds the
maximum sales load charged by the fund from which dividends or
distributions are being swept, without giving effect to any
reduced loads, the difference will be deducted.
D. Dividends and distributions paid by a fund may be invested in shares
of other funds that impose a contingent deferred sales charge ("CDSC")
and the applicable CDSC, if any, will be imposed upon the redemption
of such shares.
DETERMINATION OF NET ASSET VALUE
The following information supplements and should be read in
conjunction with the section in the Prospectus entitled "How to Buy
Shares."
Amortized Cost Pricing. The information contained in this section is
applicable only to the Money Market Fund. The valuation of the Money
Market Fund's portfolio securities is based upon their amortized cost,
which does not take into account unrealized capital gains or losses. This
involves valuing an instrument at its cost, and thereafter assuming a
constant amortization to maturity of any discount or premium, regardless of
the impact of fluctuating interest rates on the market value of the
instrument. While this method provides certainty in valuation, it may
result in periods during which value, as determined by amortized cost, is
higher or lower than the price the Fund would receive if it sold the
instrument.
The Money Market Fund's Board has established, as a particular
responsibility within the overall duty of care owed to the Money Market
Fund's investors, procedures reasonably designed to stabilize the Fund's
price per share as computed for the purpose of sales and redemptions at
$1.00. Such procedures include review of the Money Market Fund's portfolio
holdings by the Board, at such intervals as it deems appropriate, to
determine whether the Money Market Fund's net asset value calculated by
using available market quotations or market equivalents deviates from $1.00
per share based on amortized cost. Market quotations and market
equivalents used in such review are obtained from an independent pricing
service (the "Service") approved by the Board. The Service values the
Money Market Fund's investments based on methods which include
consideration of: yields or prices of municipal bonds of comparable
quality, coupon, maturity and type; indications of values from dealers; and
general market conditions. The Service also may employ electronic data
processing techniques and/or a matrix system to determine valuations.
The extent of any deviation between the Money Market Fund's net asset
value based upon available market quotations or market equivalents and
$1.00 per share based on amortized cost will be examined by the Board. If
such deviation exceeds 1/2 of 1%, the Board promptly will consider what
action, if any, will be initiated. In the event the Board determines that
a deviation exists which may result in material dilution or other unfair
results to investors or existing shareholders, it has agreed to take such
corrective action as it regards as necessary and appropriate, including:
selling portfolio instruments prior to maturity to realize capital gains or
losses or to shorten average portfolio maturity; withholding dividends or
paying distributions from capital or capital gains; redeeming shares in
kind; or establishing a net asset value per share by using available market
quotations or market equivalents.
Valuation of Portfolio Securities. The information contained in this
section is applicable only to the Longer Term Funds. The investments of
each Longer Term Fund are valued each business day by an independent
pricing service (the "Service") approved by such Fund's Board. When, in
the judgment of the Service, quoted bid prices for investments are readily
available and are representative of the bid side of the market, these
investments 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 bonds of comparable quality, coupon, maturity and type;
indications as to values from dealers; and general market conditions. The
Service may employ electronic data processing techniques and/or a matrix
system to determine valuations. The Service's procedures are reviewed by
the Fund's officers under the general supervision of the relevant Fund's
Board. As to each Fund, expenses and fees, including the management fees
(reduced by the expense limitation, if any) and fees pursuant to the
Service Plan or Shareholder Services Plan, as the case may be, are accrued
daily and are taken into account for the purpose of determining the net
asset values of such Fund's shares.
New York Stock Exchange Closings. The holidays (as observed) on which
the New York Stock Exchange is closed currently are: New Year's Day,
Presidents' Day, Good Friday, Memorial Day, Independence Day, Labor Day,
Thanksgiving and Christmas.
PORTFOLIO TRANSACTIONS
Portfolio securities ordinarily are purchased from and sold to
parties acting as either principal or agent. Newly-issued securities
ordinarily are purchased directly from the issuer or from an underwriter;
other purchases and sales usually are placed with those dealers from which
it appears that the best price or execution will be obtained. Usually no
brokerage commissions, as such, are paid by any Fund for such purchases and
sales, although the price paid usually includes an undisclosed compensation
to the dealer acting as agent. The prices paid to underwriters of
newly-issued securities usually include a concession paid by the issuer to
the underwriter, and purchases of after-market securities from dealers
ordinarily are executed at a price between the bid and asked price. No
brokerage commissions have been paid by any Fund to date.
Transactions are allocated to various dealers by the portfolio
managers of a Fund in their best judgment. The primary consideration is
prompt and effective execution of orders at the most favorable price.
Subject to that primary consideration, dealers may be selected for
research, statistical or other services to enable the Manager to supplement
its own research and analysis with the views and information of other
securities firms.
Research services furnished by brokers through which a Fund effects
securities transactions may be used by the Manager in advising other funds
it advises and, conversely, research services furnished to the Manager by
brokers in connection with other funds the Manager advises may be used by
the Manager in advising each Fund. Although it is not possible to place a
dollar value on these services, it is the opinion of the Manager that the
receipt and study of such services should not reduce the overall expenses
of its research department.
The amount of transactions during the last fiscal year in newly issued
debt instruments in fixed price public offerings directed to an underwriter
in consideration of, among other things, research services provided was
$6,250 for the Intermediate Bond Fund and $130,875 for the Bond Fund.
DIVIDENDS, DISTRIBUTIONS AND TAXES
The following information supplements and should be read in
conjunction with the section in the Prospectus entitled "Dividends,
Distributions and Taxes."
All Funds. Ordinarily, gains and losses realized from portfolio
transactions will be treated as capital gain or loss. However, all or
portion of any gain realized from the sale or other disposition of certain
market discount bonds will be treated as ordinary income under Section 1276
of the Internal Revenue Code of 1986, as amended (the "Code").
Longer Term Funds Only. The Code provides that if a shareholder has
not held his Fund shares for more than six months (or such shorter period
as the Internal Revenue Service may prescribe by regulation) and has
received an exempt-interest dividend with respect to such shares, any loss
incurred on the sale of such shares will be disallowed to the extent of the
exempt-interest dividend received. In addition, any dividend or
distribution paid shortly after an investor's purchase may have the effect
of reducing the net asset value of his shares below the cost of his
investment. Such a distribution would be a return on investment in an
economic sense although taxable as stated in "Dividends, Distributions and
Taxes" in the Prospectus.
Investment by the Longer Term Funds in securities issued at a discount
or providing for deferred interest or for payment of interest in the form
of additional obligations could, under special tax rules, affect the
amount, timing and character of distributions to shareholders. For example,
a Fund could be required to take into account annually a portion of the
discount (or deemed discount) at which such securities were issued and to
distribute such portion in order to maintain its qualification as a
regulated investment company. In that case, the Fund may have to dispose
of securities which it might otherwise have continued to hold in order to
generate cash to satisfy these distribution requirements.
PERFORMANCE INFORMATION
The following information supplements and should be read in
conjunction with the section in the Prospectus entitled "Performance
Information."
Money Market Fund. For the seven-day period ended May 31, 1995, the
Money Market Fund's yield was 3.32% and its effective yield was 3.37%. The
Money Market Fund's yield is computed in accordance with a standardized
method which involves determining the net change in the value of a
hypothetical pre-existing Fund account having a balance of one share at the
beginning of a seven calendar day period for which yield is to be quoted,
dividing the net change by the value of the account at the beginning of the
period to obtain the base period return, and annualizing the results (i.e.,
multiplying the base period return by 365/7). The net change in the value
of the account reflects the value of additional shares purchased with
dividends declared on the original share and any such additional shares and
fees that may be charged to shareholder accounts, in proportion to the
length of the base period and the Fund's average account size, but does not
include realized gains and losses or unrealized appreciation and
depreciation. Effective yield is computed by adding 1 to the base period
return (calculated as described above), raising that sum to a power equal
to 365 divided by 7, and subtracting 1 from the result.
Based upon a combined 1995 Federal, New York State and New York City
personal income tax rate of 47.05%, the Money Market Fund's tax equivalent
yield for the seven-day period ended May 31, 1995 was 6.27%.
Longer Term Funds. The Intermediate Bond Fund's yield for the 30-day
period ended May 31, 1995 was 4.41%. The Bond Fund's yield for the 30-day
period ended May 31, 1995 was 4.89%. Current yield for a Longer Term Fund
is computed pursuant to a formula which operates as follows: the amount of
a Fund's expenses accrued for a 30-day period is subtracted from the amount
of the dividends and interest earned (computed in accordance with
regulatory requirements) by it during the period. That result is then
divided by the product of: (a) the average daily number of shares
outstanding during the period that were entitled to receive dividends, and
(b) the net asset value per share on the last day of the period less any
undistributed earned income per share reasonably expected to be declared as
a dividend shortly thereafter. The quotient is then added to 1, and that
sum is raised to the 6th power, after which 1 is subtracted. The current
yield is then arrived at by multiplying the result by 2.
Based upon a combined 1995 Federal, New York State and New York City
personal income tax rate of 47.05%, the Intermediate Bond Fund's tax
equivalent yield for the 30-day period ended May 31, 1995 was 8.33% and the
Bond Fund's tax equivalent yield for such period was 9.24%.
The Intermediate Bond Fund's average annual total return for the one-
and five-year periods ended May 31, 1995 and for the period from June 12,
1987 (commencement of operations) through May 31, 1995 was 7.04%, 8.01%
and 7.52%, respectively. The Bond Fund's average annual total return for
the one-, five- and ten-year periods ended May 31, 1995 was 7.55%, 8.11%
and 8.27%, respectively. Average annual total return is calculated by
determining the ending redeemable value of an investment purchased with a
hypothetical $1,000 payment made at the beginning of the period (assuming
the reinvestment of dividends and distributions), dividing by the amount of
the initial investment, taking the "n"th root of the quotient (where "n" is
the number of years in the period) and subtracting 1 from the result.
The Intermediate Bond Fund's total return for the period June 12, 1987
(commencement of operations) to May 31, 1995 was 78.18%. The Bond Fund's
total return for the period July 26, 1983 (commencement of operations) to
May 31, 1995 was 182.12%. Total return is calculated by subtracting the
amount of the Fund's net asset value per share at the beginning of a stated
period from the net asset value per share at the end of the period (after
giving effect to the reinvestment of dividends and distributions during the
period), and dividing the result by the net asset value per share at the
beginning of the period.
All Funds. Tax equivalent yield is computed by dividing that portion
of the current yield (calculated as described above) which is tax exempt by
1 minus a stated tax rate and adding the quotient to that portion, if any,
of the yield of the Fund that is not tax exempt. The tax equivalent yields
noted above represent the application of the highest Federal, New York
State and New York City marginal personal income tax rates presently in
effect. For Federal income tax purposes, a 39.6% tax rate has been used.
For New York State and New York City personal income tax purposes, tax
rates of 7.875% and 4.46%, respectively, have been used. The tax
equivalent figure, however, does not reflect the potential effect of local
(including, but not limited to, county, district or city) taxes, including
applicable surcharges. In addition, there may be pending legislation which
could affect such stated tax rates or yield. Each investor should consult
its tax adviser, and consider its own factual circumstances and applicable
tax laws, in order to ascertain the relevant tax equivalent yield.
Yields will fluctuate and are not necessarily representative of future
results. Each investor should remember that yield is a function of the
type and quality of the instruments in the portfolio, portfolio maturity
and operating expenses. An investor's principal in the Fund is not
guaranteed. See "Determination of Net Asset Value" for a discussion of the
manner in which the Fund's price per share is determined.
From time to time, each Fund may use hypothetical tax equivalent
yields or charts in their advertising. These hypothetical yields or charts
will be used for illustrative purposes only and are not indicative of the
Fund's past or future performance.
Advertising materials for a Fund also may refer to or discuss then-
current or past economic conditions, developments, and/or events, and
actual or proposed tax legislation. From time to time, advertising
materials of a Fund also may refer to statistical or other information
concerning trends relating to investment companies, as compiled by industry
associations such as the Investment Company Institute. From time to time,
advertising materials for the Longer Term Funds also may refer to
Morningstar ratings and related analyses supporting such ratings.
INFORMATION ABOUT THE FUNDS
The following information supplements and should be read in
conjunction with the section in the Prospectus entitled "General
Information."
Each Fund share has one vote and, when issued and paid for in
accordance with the terms of the offering, is fully paid and
non-assessable. Each Fund share is of one class and has equal rights as to
dividends and in liquidation. Shares have no preemptive, subscription or
conversion rights and are freely transferable.
Each Fund sends an annual and semi-annual financial statements to all
its respective shareholders.
CUSTODIAN, TRANSFER AND DIVIDEND DISBURSING AGENT,
COUNSEL AND INDEPENDENT AUDITORS
The Bank of New York, 90 Washington Street, New York, New York 10286,
acts as custodian of each Fund's investments. The Shareholder Services
Group, Inc., a subsidiary of First Data Corporation, P.O. Box 9671,
Providence, Rhode Island 02940-9671, is each Fund's transfer and dividend
disbursing agent. Neither The Bank of New York nor The Shareholder
Services Group, Inc. has any part in determining the investment policies of
any Fund or which securities are to be purchased or sold by a Fund.
Stroock & Stroock & Lavan, Seven Hanover Square, New York, New York
10004-2696, as counsel for each Fund, has rendered its opinion as to
certain legal matters regarding the due authorization and valid issuance of
the shares being sold pursuant to the Prospectus.
Ernst & Young LLP, 787 Seventh Avenue, New York, New York 10019,
independent auditors, have been selected as auditors of each Fund.
APPENDIX A
RISK FACTORS--INVESTING IN NEW YORK MUNICIPAL OBLIGATIONS
The financial condition of New York State (the "State") and certain of
its public bodies (the "Agencies") and municipalities, particularly New
York City (the "City"), could affect the market values and marketability of
New York Municipal Obligations which may be held by the Fund. The
following information constitutes only a brief summary, does not purport to
be a complete description, and is based on information drawn from official
statements relating to securities offerings of the State, the City and the
Municipal Assistance Corporation for the City of New York ("MAC") available
as of the date of this Statement of Additional Information. While the Fund
has not independently verified such information, it has no reason to
believe that such information is not correct in all material respects.
A national recession commenced in mid-1990. The downturn continued
through the remainder of the 1990-91 fiscal year, and was followed by a
period of weak economic growth during the remainder of the 1991 calendar
year. For the calendar year 1992, the national economy continued to
recover, although at a rate below all post-war recoveries. The recession
was more severe in the State than in other parts of the nation, owing to a
significant retrenchment in the financial services industry, cutbacks in
defense spending, and an overbuilt real estate market. The State economy
remained in recession until 1993, when employment growth resumed. Since
early 1993, the State has gained approximately 100,000 jobs. The State's
economy is expected to continue to expand modestly during 1995, but there
will be a pronounced slow-down during the course of the year. Although
industries that export goods and services abroad are expected to benefit
from the lower dollar, growth will be slowed by government cutbacks at all
levels. On an average annual basis, employment growth will be about the
same as 1994. Both personal income and wages are expected to record
moderate gains in 1995.
The State's budget for the 1995-96 fiscal year was enacted by the
Legislature on June 7, 1995, more than two months after the start of the
fiscal year. Prior to adoption of the budget, the Legislature enacted
appropriations for disbursements considered to be necessary for State
operations and other purposes, including all necessary appropriations for
debt service. The State Financial Plan for 1995-96 fiscal year was
formulated on June 20, 1995 and is based on the State's budget as enacted
by the Legislature and signed into law by the Governor.
The 1995-96 budget is the first to be enacted in the administration of
the Governor, who assumed office on January 1. It is the first budget in
over half a century which proposed and, as enacted, projects an absolute
year-over-decline in General Fund disbursements. Spending for State
operations is projected to drop even more sharply, by 4.6%. Nominal
spending from all State funding sources (i.e., excluding Federal aid) is
proposed to increase by only 2.5% from the prior fiscal year, in contrast
to the prior decade when such spending growth averaged more than 6.0%
annually.
In his Executive Budget, the Governor indicated that in the 1995-96
fiscal year, the State Financial Plan, based on then-current law governing
spending and revenues, would be out of balance by almost $4.7 billion, as a
result of the projected structural deficit resulting from the ongoing
disparity between sluggish growth in receipts, the effect of prior-year tax
changes, and the rapid acceleration of spending growth; the impact of
unfunded 1994-95 initiatives, primarily for local aid programs; and the use
of one-time solutions, primarily surplus funds from the prior year, to fund
recurring spending in the 1994-95 budget. The Governor proposed additional
tax cuts, to spur economic growth and provide relief for low and middle-
income tax payers, which were larger than those ultimately adopted, and
which added $240 million to the then projected imbalance or budget gap,
bringing their total to approximately $5 billion.
This gap is projected to be closed in the 1995-96 State Financial Plan
based on the enacted budget, through a series of actions, mainly spending
reductions and cost containment measures and certain reestimates that are
expected to be recurring, but also through the use of one-time solutions.
The State Financial Plan is based upon forecasts of national and State
economic activity. Economic forecasts have frequently failed to predict
accurately the timing and magnitude of changes in the national and the
State economies. Many uncertainties exist in forecasts of both the
national and State economies, including consumer attitudes toward spending,
Federal financial and monetary policies, the availability of credit and the
condition of the world economy, which could have an adverse effect on the
State. There can be no assurance that the State economy will not
experience worse-than-predicted results in the 1994-95 fiscal year, with
corresponding material and adverse effects on the State's projections of
receipts and disbursements.
The General Fund is projected to be balanced on a cash basis for the
1995-96 fiscal year. Total receipts and transfers from other funds are
projected to be $33.110 billion, a decrease of $48 million from total
receipts in the prior fiscal year. Total General fund disbursements and
transfers to other funds are projected to be $33.055 billion, a decrease of
$344 million from the total amount disbursed in the prior fiscal year.
There can be no assurance that the State will not face substantial
potential budget gaps in future years resulting from a significant
disparity between tax revenues projected from a lower recurring receipts
base and the spending required to maintain State programs at current
levels. To address any potential budgetary imbalance, the State may need
to take significant actions to align recurring receipts and disbursements
in future fiscal years.
On June 6, 1990, Moody's changed its ratings on all the State's
outstanding general obligation bonds from A1 to A. On March 26, 1990 and
January 13, 1992, S&P changed its ratings on all of the State's outstanding
general obligation bonds from AA- to A and from A to A-, respectively. In
February 1991, Moody's lowered its rating on the City's general obligation
bonds from A to Baa1 and in July 1995, S&P lowered its rating on such bonds
from A- to BBB+. Ratings reflect only the respective views of such
organizations, and their concerns about the financial condition of New York
State and City, the debt load of the State and City and any economic
uncertainties about the region. There is no assurance that a particular
rating will continue for any given period of time or that any such rating
will not be revised downward or withdrawn entirely if, in the judgment of
the agency originally establishing the rating, circumstances so warrant.
(1) The State, Agencies and Other Municipalities. During the mid-
1970s, some of the Agencies and municipalities (in particular, the City)
faced extraordinary financial difficulties, which affected the State's own
financial condition. These events, including a default on short-term notes
issued by the New York State Urban Development Corporation ("UDC") in
February 1975, which default was cured shortly thereafter, and a
continuation of the financial difficulties of the City, created substantial
investor resistance to securities issued by the State and by some of its
municipalities and Agencies. For a time, in late 1975 and early 1976,
these difficulties resulted in a virtual closing of public credit markets
for State and many State related securities.
In response to the financial problems confronting it, the State
developed and implemented programs for its 1977 fiscal year that included
the adoption of a balanced budget on a cash basis (a deficit of $92 million
that actually resulted was financed by issuing notes that were paid during
the first quarter of the State's 1978 fiscal year). In addition,
legislation was enacted limiting the occurrence of additional so-called
"moral obligation" and certain other Agency debt, which legislation does
not, however, apply to MAC debt.
State Financial Cash-Basis Results--General Fund. The General Fund is
the principal operating fund of the State and is used to account for all
financial transactions, except those required to be accounted for in
another fund. It is the State's largest fund and receives almost all State
taxes and other resources not dedicated to particular purposes. General
Fund moneys are also transferred to other funds, primarily to support
certain capital projects and debt service payments in other fund types.
New York State's financial operations have improved during recent
fiscal years. During the period 1989-90 through 1991-92, the State
incurred General Fund operating deficits that were closed with receipts
from the issuance of tax and revenue anticipation notes ("TRANs"). First,
the national recession, and then the lingering economic slowdown in the New
York and regional economy, resulted in repeated shortfalls in receipts and
three budget deficits. For its 1992-93, 1993-94 and 1994-95 fiscal years,
the State recorded balanced budgets on a cash basis, with substantial fund
balances in 1992-93 and 1993-94, and smaller fund balance in 1994-95, as
described below.
New York State ended its 1994-95 fiscal year with the General fund in
balance. The closing fund balance of $158 million reflects $157 million in
the Tax Stabilization Reserve Fund and $1 million in the Contingency
Reserve Fund ("CRF"). The CRF was established in State Fiscal year 1993-
94, funded partly with surplus moneys, to assist the State in financing the
1994-95 fiscal year costs of extraordinary ligation known or anticipated at
that time; the opening fund balance in State fiscal year 1994-95 was $265
million. The $241 million change in the fund balance reflects the use of
$264 million in the CRF as planned, as well as the required deposit of $23
million to the Tax Stabilization Reserve Fund. In addition, $278 million
was on deposit in the tax refund reserve account, $250 million of which was
deposited at the end of the State's 1994-95 fiscal year to continue the
process of restructuring the State's cash flow as part of the New York
Local Government Assistance Corporation ("LGAC") program.
Compared to the State Financial Plan for 1994-1995 as formulated on
June 16, 1994, reported receipts fell short of original projections by
$1.163 billion, primarily in the categories of personal income and business
taxes. Of this amount, the personal income tax accounts for $800 million,
reflecting weak estimated tax collections and lower withholding due to
reduced wage and salary growth, more severe reductions in brokerage
industry bonuses than projected earlier, and deferral of capital gains
realizations in anticipation of potential Federal tax changes. Business
taxes fell short by $373 million, primarily reflecting lower payments from
banks as substantial overpayments of 1993 liability depressed net
collections in the 1994-95 fiscal year. These shortfalls were offset by
better performance in the remaining taxes, particularly the user taxes and
fees, which exceeded projections by $210 million. Of this amount, $277
million was attributable to certain restatements for accounting treatment
purposes pertaining to the CRF and LGAC; these restatements had no impact
on balance in the General Fund.
Disbursements were also reduced from original projections by $848
million. After adjusting for the net impact of restatements relating to
the CRF and LGAC which raised disbursements by $38 million, the variance is
$886 million. Well over two-thirds of this variance is in the category of
grants to local governments, primarily reflecting the conservative nature
of the original estimates of projected costs for social services and other
programs. Lower education costs are attributable to the availability of
$110 million in additional lottery proceeds and the use of LGAC bond
proceeds.
The spending reductions also reflect $188 million in actions initiated
in January 1995 by the Governor to reduce spending to avert a potential gap
in the 1994-95 State Financial Plan. These actions included savings from a
hiring freeze, halting the development of certain services, and the
suspension of non-essential capital projects. These actions, together with
$71 million in other measures comprised the Governor's $259 million gap-
closing plan, submitted to the Legislature in connection with the 1995-96
Executive Budget.
The State ended its 1993-94 fiscal year with a balance of $1.140
billion in the tax refund reserve account, $265 million in the CRF and $134
million in its tax stabilization reserve fund. These fund balances were
primarily the result of an improving national economy, State employment
growth, tax collections that exceeded earlier projections and disbursements
that were below expectations. Deposits to the personal income tax refund
reserve have the effect of reducing reported personal income tax receipts
in the fiscal year when made and withdrawals from such reserve increase
receipts in the fiscal year when made. The balance in the tax reserve
account will be used to pay taxpayer refunds, rather than drawing from
1994-95 receipts.
Of the $1.140 billion deposited in the tax refund reserve account,
$1.026 billion was available for budgetary planning purposes in the 1994-95
fiscal year. The remaining $114 million will be redeposited in the tax
refund reserve account at the end of the State's 1994-95 fiscal year to
continue the process of restructuring the State's cash flow as part of the
LGAC program. The balance in the contingency reserve fund was reserved to
meet the cost of litigation facing the State in its 1994-95 fiscal year.
Before the deposit of $1.140 billion in the tax refund reserve
account, General Fund receipts in 1993-94 exceeded those originally
projected when the State Financial Plan for the year was formulated on
April 16, 1993 by $1.002 billion. Greater-than-expected receipts in the
personal income tax, the bank tax, the corporation franchise tax and the
estate tax accounted for most of this variance, and more than offset
weaker-than-projected collections from the sales and use tax and
miscellaneous receipts. Collections from individual taxes were affected
by various factors including changes in Federal business laws, sustained
profitability of banks, strong performance of securities firms, and higher-
than-expected consumption of tobacco products following price cuts.
The higher receipts resulted, in part, because the New York economy
performed better than forecasted. Employment growth started in the first
quarter of the State's 1993-94 year, and although this lagged the national
economic recovery, the growth in New York began earlier than forecasted.
The New York economy exhibited signs of strength in the service sector, in
construction, and in trade. Long Island, and the Mid-Hudson Valley
continued to lag the rest of the State in economic growth. Approximately
100,000 jobs are believed to have been added during the 1993-94 fiscal
year.
Disbursements and transfer from the General Fund were $303 million
below the level projected in April 1993, an amount that would have been
$423 million had the State not accelerated the payment of Medicaid
billings, which in the April 1993 State Financial Plan were planned to be
deferred into the 1994-95 fiscal year. Compared to the estimates included
in the State Financial Plan formulated in April 1993, disbursements were
lower for Medicaid, capital projects, and debt service (due to refundings).
In addition, $114 million of school and payments were funded from the
proceeds of LGAC bonds. Disbursements were higher-than-expected for
general support for public schools. The State also made the first of six
required payments to the State of Delaware related to the settlement of
Delaware's litigation against the State regarding the disposition of
abandoned property receipts.
During the 1993-94 fiscal year, the State also established and funded
the CRF as a way to assist the State in financing the cost of litigation
affecting the State. The CRF was initially funded with a transfer of $100
million attributable to the positive margin recorded in the 1992-93 fiscal
year. In addition, the State augmented this initial deposit with $132
million on debt service savings attributable to the refinancing of State
and public authority bonds during 1993-94. A year-end transfer of $36
million was also made to the CRF, which, after a disbursement for
authorized fund purposes, brought the CRF balance at the end of 1993-94 to
$265 million. This amount was $165 million higher than the amount
originally targeted for this reserve fund.
For its 1992-93 fiscal year the State had a balanced budget on a cash
basis with a positive margin of $671 million in the General Fund that was
deposited in the refund reserve account.
After reflecting a 1992-93 year-end deposit to the refund reserve
account of $671 million, reported 1992-93 General Fund receipts were $45
million higher than originally projected in April 1992. If not for that
year-end transaction, which had the effect of reducing 1992-93 receipts by
$671 million and making those receipts available in 1993-94, General Fund
receipts would have been $716 million higher than originally projected.
The favorable performance was primarily attributable to personal
income tax collections that were more than $700 million higher than
originally projected (before reflecting the refund reserve transaction).
The withholding and estimated payment components of the personal income tax
exceeded original estimates by more than $800 million combined, reflecting
both stronger economic activity, particularly at year's end, and the tax-
induced one-time acceleration of income into 1992. Modest shortfalls were
experienced in other components of the income tax.
There were large, but largely offsetting, variances in other
categories. Significantly higher-than-projected business tax collections
and the receipt of unbudgeted payments from the Medical Malpractice
Insurance Association and the New York Racing Association approximately
offset the loss of an anticipated $200 million Federal reimbursement, the
loss of certain budgeted hospital differential revenue as a result of
unfavorable court decisions, and shortfalls in certain miscellaneous
revenue sources.
Disbursements and transfers to other funds totaled $30.829 billion, an
increase of $45 million above projections in April 1992. After adjusting
for the impact of a $150 million payment from the Medical Malpractice
Insurance Association to health insurers made pursuant to legislation
passed in January 1993, actual disbursements were $105 million lower than
projected. This reduction primarily reflected higher-than-anticipated
costs for educational programs, as offset by lower costs in virtually all
other categories of spending, including Medicaid, local health programs,
agency operations, fringe benefits, capital projects and debt service.
During its 1989-90, 1990-91 and 1991-92 fiscal years, the State
incurred cash-basis operating deficits in the General Fund of $775 million,
$1.081 billion and $575 million, respectively, prior to the issuance of
short-term TRANs, owing to lower-than-projected receipts.
Other Governmental Funds. Activity in the three other governmental
funds has remained relatively stable over the last three fiscal years, with
Federally-funded programs comprising approximately two-thirds of these
funds. The most significant change in the structure of these funds has
been the redirection, beginning in the 1993-94 fiscal year, of a portion of
transportation-related revenues from the General Fund to two new dedicated
funds in the Special Revenue and Capital Projects Fund types. These
revenues totalling $676 million in the 1994-95 fiscal year were used to
support the capital programs of the Department of Transportation and the
Metropolitan Transportation Authority ("MTA").
The Special Revenue Funds account for State receipts from specific
sources that are legally restricted in use to specified purposes and
include all moneys received from the Federal government. Total receipts in
Special Revenue Funds are projected at $25.547 billion in the State's 1995-
96 fiscal year. Disbursements from Special Revenue Funds are projected to
be $26.002 billion for the State's 1995-96 fiscal year.
The Capital Projects Funds are used to finance the acquisition and
construction of major capital facilities and to aid local government units
and Agencies in financing capital constructions. Federal grants for
capital projects, largely highway-related, are projected to account for 24%
of the $4.170 billion in total projected receipts in Capital Projects Funds
in the State's 1995-96 fiscal year. Total disbursements for capital
projects are projected to be $4.160 billion during the State's 1995-96
fiscal year.
The Debt Service Funds serve to fulfill State debt service on long-
term general obligation State debt and other State lease/purchase and
contractual obligation financing commitments. Total receipts in Debt
Service Funds are projected to reach $2.409 billion in the State's 1995-96
fiscal year. Total disbursements from Debt Service Funds for debt service,
lease/purchase and contractual obligation financing commitments are
projected to be $2.506 billion for the 1994-95 fiscal year.
State Borrowing Plan. The State anticipates that its capital programs
will be financed, in part, through borrowings by the State and public
authorities in the 1995-96 fiscal year. The State expects to issue $248
million in general obligation bonds (including $70 million for purposes of
redeeming outstanding BANs) and $186 million in general obligation
commercial paper. The Legislature has also authorized the issuance of up
to $33 million in COPs during the State's 1995-96 fiscal year for equipment
purchases and $14 million for capital purposes. The projection of the
State regarding its borrowings for the 1995-96 fiscal year may change if
circumstances require.
In addition, the LGAC is authorized to provide net proceeds of up to
$529 million during the 1995-96 fiscal year to redeem notes sold in June
1995.
State Agencies. The fiscal stability of the State is related, at
least in part, to the fiscal stability of its localities and various of its
Agencies. Various Agencies have issued bonds secured, in part, by
non-binding statutory provisions for State appropriations to maintain
various debt service reserve funds established for such bonds (commonly
referred to as "moral obligation" provisions).
At September 30, 1994, there were 18 Agencies that had outstanding
debt of $100 million or more. The aggregate outstanding debt, including
refunding bonds, of these 18 Agencies was $70.3 billion as of September 30,
1994. As of March 31, 1995, aggregate Agency debt outstanding as State-
supported debt was $27.9 billion and as State-related was $36.1 billion.
Debt service on the outstanding Agency obligations normally is paid out of
revenues generated by the Agencies' projects or programs, but in recent
years the State has provided special financial assistance, in some cases on
a recurring basis, to certain Agencies for operating and other expenses and
for debt service pursuant to moral obligation indebtedness provisions or
otherwise. Additional assistance is expected to continue to be required in
future years.
Several Agencies have experienced financial difficulties in the past.
Certain Agencies continue to experience financial difficulties requiring
financial assistance from the State. Failure of the State to appropriate
necessary amounts or to take other action to permit certain Agencies to
meet their obligations could result in a default by one or more of such
Agencies. If a default were to occur, it would likely have a significant
effect on the marketability of obligations of the State and the Agencies.
These Agencies are discussed below.
The New York State Housing Finance Agency ("HFA") provides financing
for multifamily housing, State University construction, hospital and
nursing home development, and other programs. In general, HFA depends upon
mortgagors in the housing programs it finances to generate sufficient funds
from rental income, subsidies and other payments to meet their respective
mortgage repayment obligations to HFA, which provide the principal source
of funds for the payment of debt service on HFA bonds, as well as to meet
operating and maintenance costs of the projects financed. From January 1,
1976 through March 31, 1987, the State was called upon to appropriate a
total of $162.8 million to make up deficiencies in the debt service reserve
funds of HFA pursuant to moral obligation provisions. The State has not
been called upon to make such payments since the 1986-87 fiscal year and no
payments are anticipated during the 1995-96 fiscal year.
UDC has experienced, and expects to continue to experience, financial
difficulties with the housing programs it had undertaken prior to 1975,
because a substantial number of these housing program mortgagors are unable
to make full payments on their mortgage loans. Through a subsidiary, UDC
is currently attempting to increase its rate of collection by accelerating
its program of foreclosures and by entering into settlement agreements.
UDC has been, and will remain, dependent upon the State for appropriations
to meet its operating expenses. The State also has appropriated money to
assist in the curing of a default by UDC on notes which did not contain the
State's moral obligation provision.
The MTA oversees New York City's subway and bus lines by its
affiliates, the New York City Transit Authority and the Manhattan and Bronx
Surface Transit Operating Authority (collectively, the "TA"). Through
MTA's subsidiaries, the Long Island Rail Road Company, the Metro-North
Commuter Railroad Company and the Metropolitan Suburban Bus Authority, the
MTA operates certain commuter rail and bus lines in the New York
metropolitan area. In addition, the Staten Island Rapid Transit Authority,
an MTA subsidiary, operates a rapid transit line on Staten Island. Through
its affiliated agency, the Triborough Bridge and Tunnel Authority (the
"TBTA"), the MTA operates certain toll bridges and tunnels. Because fare
revenues are not sufficient to finance the mass transit portion of these
operations, the MTA has depended and will continue to depend for operating
support upon a system of State, local government and TBTA support and, to
the extent available, Federal operating assistance, including loans, grants
and subsidies. If current revenue projections are not realized and/or
operating expenses exceed current projections, the TA or commuter railroads
may be required to seek additional State assistance, raise fares or take
other actions.
Over the past several years the State has enacted several
taxes--including a surcharge on the profits of banks, insurance
corporations and general business corporations doing business in the
12-county region (the "Metropolitan Transportation Region") served by the
MTA and a special .25% regional sales and use tax--that provide additional
revenues for mass transit purposes, including assistance to the MTA. In
addition, since 1987, State law has required that the proceeds of .25%
mortgage recording tax paid on certain mortgages in the Metropolitan
Transportation Region be deposited in a special MTA fund for operating or
capital expenses. Further, in 1993, the State dedicated a portion of
certain additional State petroleum business tax receipts to fund operating
or capital assistance to the MTA. For the 1994-96 State fiscal year, total
State assistance to the MTA is estimated at approximately $1.1 billion.
A subway fire on December 28, 1990 and a subway derailment on August
28, 1991, each of which caused fatalities and many injuries, have given
rise to substantial claims for damages against both the TA and the City.
In 1981, the State Legislature authorized procedures for the adoption,
approval and amendment of a five-year plan for the capital program designed
to upgrade the performance of the MTA's transportation systems and to
supplement, replace and rehabilitate facilities and equipment, and also
granted certain additional bonding authorization therefor.
On April 5, 1993, the Legislature approved, and the Governor
subsequently signed into law, legislation authorizing a five-year $9.56
billion capital plan for the MTA for 1992-1996. The MTA has received
approval of the 1992-1996 Capital Program based on this legislation from
the MTA Capital Program Review Board (the "CPRB"), as State law requires.
This is the third five-year plan since the Legislature authorized
procedures for the adoption, approval and amendment of a five-year plan in
1981 for a capital program designed to upgrade the performance of the MTA's
transportation systems and to supplement, replace and rehabilitate
facilities and equipment. The MTA, the TBTA and the TA are collectively
authorized to issue an aggregate of $3.1 billion of bonds (net of certain
statutory exclusions) to finance a portion of the 1992-96 Capital Program.
The 1992-96 Capital Program was expected to be financed in significant part
through dedication of the State petroleum business tax receipts referred to
above. However, in December 1994 the proposed bond resolution based on
such tax receipts was not approved by the MTA Capital Program Review Board.
Further consideration of the resolution was deferred until 1995.
There can be no assurance that such governmental actions will be
taken, that sources currently identified will not be decreased or
eliminated, or that the 1992-1996 Capital Program will not be delayed or
reduced. If the MTA capital program is delayed or reduced because of
funding shortfalls or other factors, ridership and fare revenues may
decline, which could, among other things, impair the MTA's ability to meet
its operating expenses without additional State assistance.
The cities, towns, villages and school districts of the State are
political subdivisions of the State with the powers granted by the State
Constitution and statutes. As the sovereign, the State retains broad
powers and responsibilities with respect to the government, finances and
welfare of these political subdivisions, especially in education and social
services. In recent years the State has been called upon to provide added
financial assistance to certain localities.
Other Localities. Certain localities in addition to the City could
have financial problems leading to requests for additional State assistance
during the State's 1995-96 fiscal year and thereafter. The potential
impact on the State of such actions by localities is not included in the
projections of the State receipts and disbursements in the State's 1995-96
fiscal year.
Municipalities and school districts have engaged in substantial
short-term and long-term borrowings. In 1993, the total indebtedness of
all localities in the State, other than the City, was approximately $17.7
billion. A small portion (approximately $105 million) of this indebtedness
represented borrowing to finance budgetary deficits and was issued pursuant
to enabling State legislation. State law requires the Comptroller to
review and make recommendations concerning the budgets of those local
government units other than the City authorized by State law to issue debt
to finance deficits during the period that such deficit financing is
outstanding. Fifteen localities had outstanding indebtedness for deficit
financing at the close of their fiscal year ending in 1993.
Certain proposed Federal expenditure reductions would reduce, or in
some cases eliminate, Federal funding of some local programs and
accordingly might impose substantial increased expenditure requirements on
affected localities to increase local revenues to sustain those
expenditures. If the State, the City or any of the Agencies were to suffer
serious financial difficulties jeopardizing their respective access to the
public credit markets, the marketability of notes and bonds issued by
localities within the State could be adversely affected. Localities also
face anticipated and potential problems resulting from certain pending
litigation, judicial decisions and long-range economic trends. The
longer-range, potential problems of declining city population, increasing
expenditures and other economic trends could adversely affect localities
and require increasing State assistance in the future.
Because of significant fiscal difficulties experienced from time to
time by the City of Yonkers, a Financial Control Board was created by the
State in 1984 to oversee Yonkers' fiscal affairs. Future actions taken by
the Governor or the State Legislature to assist Yonkers in this crisis
could result in the allocation of State resources in amounts that cannot
yet be determined.
Certain litigation pending against the State or its officers or
employees could have a substantial or long-term adverse effect on State
finances. Among the more significant of these litigations are those that
involve: (i) the validity and fairness of agreements and treaties by which
various Indian tribes transferred title to the State of approximately six
million acres of land in central New York; (ii) certain aspects of the
State's Medicaid rates and regulations, including reimbursements to
providers of mandatory and optional Medicaid services; (iii) contamination
in the Love Canal area of Niagara Falls; (iv) a challenge to the State's
practice of reimbursing certain Office of Mental Health patient-care
expenses with clients' Social Security benefits; (v) a challenge to the
methods by which the State reimburses localities for the administrative
costs of food stamp programs; (vi) a challenge to the State's possession
of certain funds taken pursuant to the State's Abandoned Property law;
(vii) alleged responsibility of State officials to assist in remedying
racial segregation in the City of Yonkers; (viii) an action, in which the
State is a third party defendant, for injunctive or other appropriate
relief, concerning liability for the maintenance of stone groins
constructed along certain areas of Long Island's shoreline; (ix) actions
challenging the constitutionality of legislation enacted during the 1990
legislative session which changed the actuarial funding methods for
determining contributions to State employee retirement systems; (x) an
action against State and City officials alleging that the present level of
shelter allowance for public assistance recipients is inadequate under
statutory standards to maintain proper housing; (xi) an action challenging
legislation enacted in 1990 which had the effect of deferring certain
employer contributions to the State Teachers' Retirement System and
reducing State aid to school districts by a like amount; (xii) a challenge
to the constitutionality of financing programs of the Thruway Authority
authorized by Chapters 166 and 410 of the Laws of 1991 (described below in
this Part); (xiii) a challenge to the constitutionality of financing
programs of the Metropolitan Transportation Authority and the Thruway
Authority authorized by Chapter 56 of the Laws of 1993 (described below in
this Part); (xiv) challenges to the delay by the State Department of Social
Services in making two one-week Medicaid payments to the service providers;
(xv) challenges by commercial insurers, employee welfare benefit plans, and
health maintenance organizations to provisions of Section 2807-c of the
Public Health Law which impose 13%, 11% and 9% surcharges on inpatient
hospital bills and a bad debt and charity care allowance on all hospital
bills paid by such entities; (xvi) challenges to the promulgation of the
State's proposed procedure to determine the eligibility for and nature of
home care services for Medicaid recipients; (xvii) a challenge to State
implementation of a program which reduces Medicaid benefits to certain
home-relief recipients; and (xviii) challenges to the rationality and
retroactive application of State regulations recelebrating nursing home
Medicaid rates.
Adverse developments or decisions in such cases could affect the
ability of the State to maintain a balanced 1994-95 State Financial Plan.
(2) New York City. In the mid-1970s, the City had large
accumulated past deficits and until recently was not able to generate
sufficient tax and other ongoing revenues to cover expenses in each fiscal
year. However,the City's operating results for the fiscal year ending June
30, 1994 were balanced in accordance with GAAP, the twelfth consecutive year
in which the City achieved balanced operating results in accordance with
GAAP. The City's ability to maintain balanced operating results in future
years is subject to numerous contingencies and future developments.
The City's economy, whose rate of growth slowed substantially over the
past three years, is currently in recession. During the 1990 and 1991
fiscal years, as a result of the slowing economy, the City has experienced
significant shortfalls in almost all of its major tax sources and increases
in social services costs, and has been required to take actions to close
substantial budget gaps in order to maintain balanced budgets in accordance
with the Financial Plan.
In 1975, the City became unable to market its securities and entered a
period of extraordinary financial difficulties. In response to this
crisis, the State created MAC to provide financing assistance to the City
and also enacted the New York State Financial Emergency Act for the City of
New York (the "Emergency Act") which, among other things, created the
Financial Control Board (the "Control Board") to oversee the City's
financial affairs and facilitate its return to the public credit markets.
The State also established the Office of the State Deputy Comptroller
("OSDC") to assist the Control Board in exercising its powers and
responsibilities. On June 30, 1986, the Control Board's powers of approval
over the City Financial Plan were suspended pursuant to the Emergency Act.
However, the Control Board, MAC and OSDC continue to exercise various
monitoring functions relating to the City's financial condition. The City
prepares and operates under a four-year financial plan which is submitted
annually to the Control Board for review and which the City periodically
updates.
The City's independently audited operating results for each of its
fiscal years from 1981 through 1993 show a General Fund surplus reported in
accordance with GAAP. The City has eliminated the cumulative deficit in
its net General Fund position. In addition, the City's financial
statements for the 1993 fiscal year received an unqualified opinion from
the City's independent auditors, the eleventh consecutive year the City has
received such an opinion.
In August 1993, the City adopted and submitted to the Control Board
for its review a four-year Financial Plan covering fiscal years 1994
through 1997 (the "Financial Plan"). The Financial Plan was based on the
City's fiscal year 1994 expense budget adopted June 14, 1993 as well as
certain changes incorporated subsequent to the budget adoption process. On
November 23, 1993, the City adopted and submitted to the Control Board for
its review a first quarter modification to the Financial Plan (the
"November Modification") incorporating various re-estimates of revenues and
expenditures. For fiscal year 1994, the November Modification includes
additional resources stemming primarily from the City Comptroller's fiscal
year 1993 annual audit, savings from a reduction in prior years' accrued
expenditures, and higher State and Federal aid resulting from claims by the
City for reimbursement of various social services costs. These resources
were used to fund new needs in the November Modification including higher
costs in the uniformed agencies, at the Board of Education (the "BoE") and
for certain social services, the unlikelihood of the sale of the Off-Track
Betting Corporation (the "OTB"), and lower estimates of miscellaneous and
other revenues. After taking these adjustments into account, the November
Modification projects a balanced budget for fiscal year 1994, based upon
revenues of $31,585 billion. For fiscal years 1995, 1996 and 1997, the
November Modification projects budget gaps of $1.730 billion, $2.513
billion and $2.699 billion, respectively. These gaps are higher by about
$450 million in fiscal year 1995 and by about $700 million in each of
fiscal years 1996 and 1997 than in the Financial Plan, primarily on account
of the nonrecurring value of the fiscal year 1994 revenue adjustments, the
loss of certain one-time resources funding BoE fiscal year 1994 spending
needs, and the reclassification of anticipated State aid from the baseline
revenue estimates to the gap-closing program. To offset these larger gaps,
the November Modification relies on additional City, State and other
actions.
On December 1, 1993, a three-member panel appointed by the Mayor to
address City structural budget imbalance released a report setting forth
its findings and recommendations. In its report, the panel noted that
budget imbalance is likely to be greater than the City now projects by $255
million in fiscal year 1995, rising to nearly $1.5 billion in fiscal year
1997. The report provided a number of options that the City should
consider in addressing the structural balance issue such as severe cuts in
City-funded personnel levels, increases in residential property taxes and
the sales tax, and the imposition of bridge tolls and solid waste
collection fees. The report also noted that additional State actions will
be required in many instances to allow the City to cut its budget without
grave damage to basic services.
On December 21, 1993, OSDC issued a report reviewing the November
Modification. The report noted that while the outlook for fiscal year 1994
has improved since August, it will be necessary for the City to manage its
budget aggressively in order to stay on course for budget balance this
year. For fiscal years 1995 through 1997, the report expressed concern
that the gaps identified by the City in the November Modification are the
largest as a percentage of City-fund revenues that the City has faced at
this point in the fiscal year since budget balance in accordance with GAAP
was first achieved in fiscal year 1981.
On December 21, 1993, the staff of the Control Board issued its report
on the November Modification. The report states that the plan is now more
realistic in terms of the gaps it portrays and the solutions it offers.
However, the solutions are mostly limited to fiscal year 1994 while the gap
for fiscal year 1995 has been increased by $450 million. Beginning in
fiscal year 1995, budget gaps average over $1 billion annually. Therefore,
the staff recommends that prompt action to replace many current-year one-
shots with recurring savings is critical.
On February 2, 1994, the Mayor presented to the City Council and the
Control Board a mid-year modification to the Financial Plan (the "February
Modification"). The February Modification projects a balanced budget for
fiscal year 1994, based upon revenues of $31.735 billion, including a
general reserve of $81 million. For fiscal years 1995, 1996 and 1997, the
February Modification projects gaps of $2.261 billion, $3.167 billion and
$3.253 billion, respectively, and assumes no wage and salary increases
beyond the expiration of current labor agreements which expire in fiscal
years 1995 and 1996. These gaps have grown since November by about $530
million in fiscal year 1995, and $650 million and $550 million in fiscal
years 1996 and 1997, respectively, owing in large part to lower estimates
of real property tax revenues. To close the budget gap projected for
fiscal year 1995, the February Modification includes a gap-closing program
that consists of the following major elements: (i) an agency program of
$1.048 billion; (ii) fringe benefit and pension savings of $400 million;
(iii) an intergovernmental aid package of $400 million; (iv) a workforce
reduction program of $144 million; and (v) the assumption of a $234 million
surplus roll from fiscal year 1994. Implementation of many of the gap-
closing initiatives requires the cooperation of the municipal labor unions,
the City Council and the State and Federal governments. The February
Modification also includes a tax reduction program, with most of the
financial impact affecting the later years of the Plan period.
The City requires certain amounts of financing for seasonal and
capital spending purposes. The City has issued $1.75 billion of notes for
seasonal financing purposes during the 1994 fiscal year. The City's
capital financing program projects long-term financing requirements of
approximately $17 billion for the City's fiscal years 1995 through 1998 for
the construction and rehabilitation of the City's infrastructure and other
fixed assets. The major capital requirement include expenditures for the
City's water supply system, and waste disposal systems, roads, bridges,
mass transit, schools and housing. In addition, the City and the Municipal
Water Finance Authority have issued about $1.8 billion in refunding bonds
in the 1994 fiscal year.
State Economic Trends. The State historically has been one of the
wealthiest states in the nation. For decades, however, the State has grown
more slowly than the nation as a whole, gradually eroding its relative
economic position. Statewide, urban centers have experienced significant
changes involving migration of the more affluent to the suburbs and an
influx of generally less affluent residents. Regionally, the older
Northeast cities have suffered because of the relative success that the
South and the West have had in attracting people and business. The City
has also had to face greater competition as other major cities have
developed financial and business capabilities which make them less
dependent on the specialized services traditionally available almost
exclusively in the City.
During the 1982-83 recession, overall economic activity in the State
declined less than that of the nation as a whole. However, in the calendar
years 1984 through 1991, the State's rate of economic expansion was
somewhat slower than that of the nation. In the 1990-91 recession, the
economy of the State, and that of the rest of the Northeast, was more
heavily damaged than that of the nation as a whole and has been slower to
recover. The total employment growth rate in the State has been below the
national average since 1984. The unemployment rate in the State dipped
below the national rate in the second half of 1981 and remained lower until
1991; since then, it has been higher. According to data published by the
U.S. Bureau of Economic Analysis, during the past ten years, total personal
income in the State rose slightly faster than the national average only
from 1986 through 1988.
APPENDIX B
Description of S&P and Moody's ratings:
S&P
Municipal Bond Ratings
An S&P municipal bond rating is a current assessment of the
creditworthiness of an obligor with respect to a specific obligation.
The ratings are based on current information furnished by the issuer
or obtained by S&P from other sources it considers reliable, and will
include: (1) likelihood of default-capacity and willingness of the obligor
as to the timely payment of interest and repayment of principal in
accordance with the terms of the obligation; (2) nature of and provisions
of the obligation; and (3) protection afforded by, and relative position
of, the obligation in the event of bankruptcy, reorganization or other
arrangement under the laws of bankruptcy and other laws affecting
creditors' rights.
AAA
Debt rated AAA has the highest rating assigned by S&P. Capacity to
pay interest and repay principal is extremely strong.
AA
Debt rated AA has a very strong capacity to pay interest and repay
principal and differs from the highest rated issues only in a small degree.
A
Debt rated A has a strong capacity to pay interest and repay principal
although it is somewhat more susceptible to the adverse effects of changes
in circumstances and economic conditions than debt in higher rated
categories.
BBB
Debt rated BBB is regarded as having an adequate capacity to pay
interest and repay principal. Whereas it normally exhibits adequate
protection parameters, adverse economic conditions or changing
circumstances are more likely to lead to a weakened capacity to pay
interest and repay principal for debt in this category than in higher rated
categories.
BB, B, CCC, CC, C
Debt rated BB, B, CCC, CC or C is regarded as having predominantly
speculative characteristics with respect to capacity to pay interest and
repay principal. BB indicates the least degree of speculation and C the
highest degree of speculation. While such debt will likely have some
quality and protective characteristics, these are outweighed by large
uncertainties or major risk exposures to adverse conditions.
BB
Debt rated BB has less near-term vulnerability to default than other
speculative grade debt. However, it faces major ongoing uncertainties or
exposure to adverse business, financial or economic conditions which could
lead to inadequate capacity to meet timely interest and principal payment.
B
Debt rated B has a greater vulnerability to default but presently has
the capacity to meet interest payments and principal repayments. Adverse
business, financial or economic conditions would likely impair capacity or
willingness to pay interest and repay principal.
CCC
Debt rated CCC has a current identifiable vulnerability to default,
and is dependent upon favorable business, financial and economic conditions
to meet timely payments of interest and repayment of principal. In the
event of adverse business, financial or economic conditions, it is not
likely to have the capacity to pay interest and repay principal.
CC
The rating CC is typically applied to debt subordinated to senior debt
which is assigned an actual or implied CCC rating.
C
The rating C is typically applied to debt subordinated to senior debt
which is assigned an actual or implied CCC- debt rating.
D
Bonds rated D are in default and payment of interest and/or repayment
of principal is in arrears.
Plus (+) or minus (-): The ratings from AA to CCC may be modified by
the addition of a plus or minus designation to show relative standing
within the major ratings categories.
Municipal Note Ratings
SP-1
The issuers of these municipal notes exhibit very strong or strong
capacity to pay principal and interest. Those issues determined to possess
overwhelming safety characteristics are given a plus (+) designation.
SP-2
The issuers of these municipal notes exhibit satisfactory capacity to
pay principal and interest.
Commercial Paper Ratings
The designation A-1 by S&P indicates that the degree of safety
regarding timely payment is either overwhelming or very strong. Those
issues determined to possess overwhelming safety characteristics are
denoted with a plus sign (+) designation. Capacity for timely payment on
issues with an A-2 designation is strong. However, the relative degree of
safety is not as high as for issues designated A-1.
Moody's
Municipal Bond Ratings
Aaa
Bonds which are rated Aaa are judged to be of the best quality. They
carry the smallest degree of investment risk and are generally referred to
as "gilt edge." Interest payments are protected by a large or by an
exceptionally stable margin and principal is secure. While the various
protective elements are likely to change, such changes as can be visualized
are most unlikely to impair the fundamentally strong position of such
issues.
Aa
Bonds which are rated Aa are judged to be of high quality by all
standards. Together with the Aaa group they comprise what generally are
known as high-grade bonds. They are rated lower than the best bonds
because margins of protection may not be as large as in Aaa securities or
fluctuation of protective elements may be of greater amplitude or there may
be other elements present which make the long-term risks appear somewhat
larger than in Aaa securities.
A
Bonds which are rated A possess many favorable investment attributes
and are to be considered as upper medium-grade obligations. Factors giving
security to principal and interest are considered adequate, but elements
may be present which suggest a susceptibility to impairment sometime in the
future.
Baa
Bonds which are rated Baa are considered as medium-grade obligations,
i.e., they are neither highly protected nor poorly secured. Interest
payments and principal security appear adequate for the present but certain
protective elements may be lacking or may be characteristically unreliable
over any great length of time. Such bonds lack outstanding investment
characteristics and in fact have speculative characteristics as well.
Ba
Bonds which are rated Ba are judged to have speculative elements;
their future cannot be considered as well assured. Often the protection of
interest and principal payments may be very moderate, and thereby not well
safeguarded during both good and bad times over the future. Uncertainty of
position characterizes bonds in this class.
B
Bonds which are rated B generally lack characteristics of the
desirable investment. Assurance of interest and principal payments or of
maintenance of other terms of the contract over any long period of time may
be small.
Caa
Bonds which are rated Caa are of poor standing. Such issues may be in
default or there may be present elements of danger with respect to
principal or interest.
Ca
Bonds which are rated Ca present obligations which are speculative in
a high degree. Such issues are often in default or have other marked
shortcomings.
C
Bonds which are rated C are the lowest rated class of bonds, and
issues so rated can be regarded as having extremely poor prospects of ever
attaining any real investment standing.
Moody's applies the numerical modifiers 1, 2 and 3 to show relative
standing within the major ratings categories, except in the Aaa category
and in the categories below B. The modifier 1 indicates a ranking for the
security in the higher end of a rating category; the modifier 2 indicates a
mid-range ranking; and the modifier 3 indicates a ranking in the lower end
of a rating category.
Municipal Note Ratings
Moody's ratings for state and municipal notes and other short-term
loans are designated Moody's Investment Grade (MIG). Such ratings
recognize the difference between short-term credit risk and long-term risk.
Factors affecting the liquidity of the borrower and short-term cyclical
elements are critical in short-term ratings, while other factors of major
importance in bond risk, long-term secular trends for example, may be less
important over the short run.
A short-term rating may also be assigned on an issue having a demand
feature. Such ratings will be designated as VMIG or, if the demand feature
is not rated, as NR. Short-term ratings on issues with demand features are
differentiated by the use of the VMIG symbol to reflect such
characteristics as payment upon periodic demand rather than fixed maturity
dates and payment relying on external liquidity. Additionally, investors
should be alert to the fact that the source of payment may be limited to
the external liquidity with no or limited legal recourse to the issuer in
the event the demand is not met.
Moody's short-term ratings are designated Moody's Investment Grade as
MIG 1 or VMIG 1 through MIG 4 or VMIG 4. As the name implies, when Moody's
assigns a MIG or VMIG rating, all categories define an investment grade
situation.
MIG 1/VMIG 1
This designation denotes best quality. There is present strong
protection by established cash flows, superior liquidity support or
demonstrated broad-based access to the market for refinancing.
MIG 2/VMIG 2
This designation denotes high quality. Margins of protection are
ample although not so large as in the preceding group.
Commercial Paper Ratings
The rating Prime-1 (P-1) is the highest commercial paper rating
assigned by Moody's. Issuers of P-1 paper must have a superior capacity
for repayment of short-term promissory obligations, and ordinarily will be
evidenced by leading market positions in well established industries, high
rates of return on funds employed, conservative capitalization structures
with moderate reliance on debt and ample asset protection, broad margins in
earnings coverage of fixed financial charges and high internal cash
generation, and well established access to a range of financial markets and
assured sources of alternate liquidity.
Issuers (or related supporting institutions) rated Prime-2 (P-2) have
a strong capacity for repayment of short-term promissory obligations. This
ordinarily will be evidenced by many of the characteristics cited above but
to a lesser degree. Earnings trends and coverage ratios, while sound, will
be more subject to variation. Capitalization characteristics, while still
appropriate, may be more affected by external conditions. Ample alternate
liquidity is maintained.
Fitch
Municipal Bond Ratings
The ratings represent Fitch's assessment of the issuer's ability to
meet the obligations of a specific debt issue or class of debt. The
ratings take into consideration special features of the issue, its
relationship to other obligations of the issuer, the current financial
condition and operative performance of the issuer and of any guarantor, as
well as the political and economic environment that might affect the
issuer's future financial strength and credit quality.
AAA
Bonds rated AAA are considered to be investment grade and of the
highest credit quality. The obligor has an exceptionally strong ability to
pay interest and repay principal, which is unlikely to be affected by
reasonable foreseeable events.
AA
Bonds rated AA are considered to be investment grade and of very high
credit quality. The obligor's ability to pay interest and repay principal
is very strong, although not quite as strong as bonds rated AAA. Because
bonds rated in the AAA and AA categories are not significantly vulnerable
to foreseeable future developments, short-term debt of these issuers is
generally rated F-1+.
A
Bonds rated A are considered to be investment grade and of high credit
quality. The obligor's ability to pay interest and repay principal is
considered to be strong, but may be more vulnerable to adverse changes in
economic conditions and circumstances than bonds with higher ratings.
BBB
Bonds rated BBB are considered to be investment grade and of
satisfactory credit quality. The obligor's ability to pay interest and
repay principal is considered to be adequate. Adverse changes in economic
conditions and circumstances, however, are more likely to have an adverse
impact on these bonds and, therefore, impair timely payment. The
likelihood that the ratings of these bonds will fall below investment grade
is higher than for bonds with higher ratings.
BB
Bonds rated BB are considered speculative. The obligor's ability to
pay interest and repay principal may be affected over time by adverse
economic changes. However, business and financial alternatives can be
identified which could assist the obligor in satisfying its debt service
requirements.
B
Bonds rated B are considered highly speculative. While bonds in this
class are currently meeting debt service requirements, the probability of
continued timely payment of principal and interest reflects the obligor's
limited margin of safety and the need for reasonable business and economic
activity throughout the life of the issue.
CCC
Bonds rated CCC have certain identifiable characteristics, which, if
not remedied, may lead to default. The ability to meet obligations
requires an advantageous business and economic environment.
CC
Bonds rated CC are minimally protected. Default payment of interest
and/or principal seems probable over time.
C
Bonds rated C are in imminent default in payment of interest or
principal.
DDD, DD and D
Bonds rated DDD, DD and D are in actual or imminent default of
interest and/or principal payments. Such bonds are extremely speculative
and should be valued on the basis of their ultimate recovery value in
liquidation or reorganization of the obligor. DDD represents the highest
potential for recovery on these bonds, and D represents the lowest
potential for recovery.
Plus (+) and minus (-) signs are used with a rating symbol to indicate
the relative position of a credit within the rating category. Plus and
minus signs, however, are not used in the AAA category covering 12-36
months, or in the DDD, DD or D categories.
Short-Term Ratings
Fitch's short-term ratings apply to debt obligations that are payable
on demand or have original maturities of up to three years, including
commercial paper, certificates of deposit, medium-term notes, and municipal
and investment notes.
Although the credit analysis is similar to Fitch's bond rating
analysis, the short-term rating places greater emphasis than bond ratings
on the existence of liquidity necessary to meet the issuer's obligations in
a timely manner.
F-1+
Exceptionally Strong Credit Quality. Issues assigned this rating are
regarded as having the strongest degree of assurance for timely payment.
F-1
Very Strong Credit Quality. Issues assigned this rating reflect an
assurance of timely payment only slightly less in degree than issues rated
F-1+.
F-2
Good Credit Quality. Issues carrying this rating have a satisfactory
degree of assurance for timely payments, but the margin of safety is not as
great as the F-1+ and F-1 categories.
<TABLE>
<CAPTION>
DREYFUS NEW YORK TAX EXEMPT MONEY MARKET FUND
STATEMENT OF INVESTMENTS MAY 31, 1995
PRINCIPAL
TAX EXEMPT INVESTMENTS-100.0% AMOUNT VALUE
-------------- -------------
<S> <C> <C>
Broome County Industrial Development Agency, IDR, Refunding, VRDN
(Bing Realty Co. Project) 4.10% (LOC; Meridian Bank Corp.) (a,b)........ $ 1,350,000 $ 1,350,000
City of Buffalo, RAN 5%, Series A, 7/12/95 (LOC; Landesbank) (b)............ 10,000,000 10,008,802
East Meadow Union Free School District, TAN 4.40%, 6/29/95.................. 9,800,000 9,802,906
Erie County, RAN 4.75%, 8/15/95 (LOC; Union Bank of Switzerland) (b)........ 11,900,000 11,912,316
Town of Islip Industrial Development Agency, IDR, VRDN (Radiation Dynamics
Project)
4.40%, Series A (LOC; Sumitomo Bank) (a,b).............................. 5,900,000 5,900,000
Metropolitan Transport Authority, Commuter Facilities Revenue, VRDN
3.75% (LOC: Bank of Tokyo, Industrial Bank of Japan, Mitsubishi Bank,
Morgan Bank, Morgan Guaranty Trust Co., National Westminster Bank and
Sumitomo Bank) (a,b).................................................... 34,700,000 34,700,000
Monroe County Industrial Development Agency, Revenue, VRDN (Enbi Corp.)
3.85% (LOC; ABN-Amro Bank) (a,b)........................................ 4,700,000 4,700,000
City of New York, VRDN:
4.15%, Series E-3 (LOC; Morgan Guaranty Trust Co.) (a,b)................ 4,200,000 4,200,000
4.25%, Series E-5 (LOC; Sumitomo Bank) (a,b)............................ 3,200,000 3,200,000
4.30%, Series A-4 (SBPA; Chemical Bank) (a)............................. 5,000,000 5,000,000
4.45%, Series B (Insured; MBIA) (a)..................................... 13,000,000 13,000,000
Trust Cultural Resource Revenue, Refunding (American Museum of Natural
History)
3.85%, Series A (Insured; MBIA and BPA; Credit Suisse) (a)............ 6,000,000 6,000,000
New York City Housing Development Corp., Mortgage Revenue, VRDN:
Multi-Family (York Avenue Development Project) 3.90% (LOC; Chemical Bank) (a,b) 7,000,000 7,000,000
(Park Gate Tower) 3.80% (LOC; Citibank) (a,b)........................... 655,000 655,000
(Stroheim and Romann Project) 3.80% (LOC; WestDeutsche Landesbank) (a,b) 5,700,000 5,700,000
New York City Industrial Development Agency, VRDN:
Civil Facility Revenue (Mercy College Project)
3.75% (LOC; The Bank of New York) (a,b).............................. 2,000,000 2,000,000
IDR:
(Japan Airlines Co. Limited Project)
4.40% (LOC; Morgan Guaranty Trust Co.) (a,b)...................... 13,500,000 13,500,000
(La Guardia Association Project) 4% (LOC; Banque Indosuez) (a,b)...... 13,700,000 13,700,000
New York State Energy, Research and Development Authority, PCR:
(New York State Electric and Gas) 4.65%, 3/15/96 (LOC; JP Morgan) (b)... 5,000,000 5,000,000
(Rochester Gas and Electric Corp.) 4.40%, 11/15/95 (LOC; Credit Suisse) (b) 7,000,000 7,000,000
VRDN:
(Central Hudson Gas and Electric Co. Project)
4.05%, Series A (LOC; Bankers Trust) (a,b)........................ 2,600,000 2,600,000
(Niagara Mohawk Project Corp.)
4.80% (LOC; Toronto-Dominion Bank) (a,b).......................... 3,600,000 3,600,000
New York State Housing Finance Agency, MFHR, VRDN 3.75%, Series A (a)....... 3,100,000 3,100,000
DREYFUS NEW YORK TAX EXEMPT MONEY MARKET FUND
STATEMENT OF INVESTMENTS (CONTINUED) MAY 31, 1995
PRINCIPAL
TAX EXEMPT INVESTMENTS (CONTINUED) AMOUNT VALUE
-------------- --------------
New York State Local Government Assistance Corp., VRDN:
3.70%, Series A (LOC: Credit Suisse, Swiss Bank Corp. and
Union Bank of Switzerland) (a,b)...................................... $ 29,100,000 $ 29,100,000
3.75%, Series B (LOC: Credit Suisse and Swiss Bank Corp.) (a,b)......... 23,300,000 23,300,000
New York State Medical Care Facilities Finance Agency, Revenue, VRDN
(Childrens Hospital Buffalo) 4%, Series A (LOC; Barclays Bank) (a,b).... 4,400,000 4,400,000
New York State Thruway Authority, General Revenue, VRDN 4.30% (Insured; FGIC) (a) 6,000,000 6,000,000
Niagara County, BAN 5.50%, 1/25/96.......................................... 7,000,000 7,019,536
Orange County Industrial Development Agency, IDR, VRDN
(Minolta Advance Technology Project) 4.40% (LOC; Sanwa Bank) (a,b)...... 5,900,000 5,900,000
Rochester County, BAN:
4.75%, Series I, 11/2/95................................................ 16,000,000 16,033,668
5%, 3/12/96............................................................. 10,068,000 10,125,682
Suffolk County, TAN 5.25%, 8/15/95 (LOC; WestDeutsche Landesbank) (b)....... 10,000,000 10,009,007
Triborough Bridge and Tunnel Authority, Special Obligation, VRDN
3.75% (Insured; FGIC) (a)............................................... 15,500,000 15,500,000
Westchester County, TAN 5%, 12/14/95........................................ 10,000,000 10,025,981
William Flloyd Union Free School District, TAN 4.75%, 6/30/95............... 5,050,000 5,051,760
-------------
TOTAL INVESTMENTS
(cost $316,094,658)..................................................... $316,094,658
=============
</TABLE>
<TABLE>
<CAPTION>
DREYFUS NEW YORK TAX EXEMPT MONEY MARKET FUND
SUMMARY OF ABBREVIATIONS
<S> <C> <C> <C>
BAN Bond Anticipation Notes MFHR Multi-Family Housing Revenue
BPA Bond Purchase Agreement PCR Pollution Control Revenue
FGIC Federal Guaranty Insurance Company RAN Revenue Anticipation Notes
IDR Industrial Development Revenue SBPA Standby Bond Purchase Agreement
LOC Letter of Credit TAN Tax Anticipation Notes
MBIA Municipal Bond Investors Assurance VRDN Variable Rate Demand Notes
Insurance Corporation
</TABLE>
<TABLE>
<CAPTION>
SUMMARY OF COMBINED RATINGS (UNAUDITED)
FITCH (C) OR MOODY'S OR STANDARD & POOR'S PERCENTAGE OF VALUE
- -------- -------- ------------------ --------------------
<S> <C> <C> <C>
F1+/F1 VMIG1/MIG1 SP1+/SP1 93.6%
Not Rated (d) Not Rated (d) Not Rated (d) 6.4
-------
100.0%
=======
</TABLE>
NOTES TO STATEMENT OF INVESTMENTS:
(a) Securities payable on demand. The interest rate, which is subject to
change, is based upon bank prime rates or an index of market interest
rates.
(b) Secured by letters of credit. At May 31, 1995, 65.9% of the Fund's
net assets are backed by letters of credit issued by domestic banks,
foreign banks and brokerage firms.
(c) Fitch currently provides creditworthiness information for a limited
number of investments.
(d) Securities which, while not rated by Fitch, Moody's or Standard &
Poor's have been determined by the Fund's Board of Trustees to be of
comparable quality to those rated securities in which the Fund may
invest.
See notes to financial statements.
<TABLE>
<CAPTION>
DREYFUS NEW YORK TAX EXEMPT MONEY MARKET FUND
STATEMENT OF ASSETS AND LIABILITIES MAY 31, 1995
<S> <C> <C>
ASSETS:
Investments in securities, at value-Note 1(a)........................... $316,094,658
Interest receivable..................................................... 3,061,762
Prepaid expenses........................................................ 45,703
-------------
319,202,123
LIABILITIES:
Due to The Dreyfus Corporation.......................................... $ 133,279
Due to Custodian........................................................ 1,099,683
Accrued expenses........................................................ 129,383 1,362,345
------------- -------------
NET ASSETS ................................................................ $317,839,778
=============
REPRESENTED BY:
Paid-in capital......................................................... $317,892,053
Accumulated net realized (loss) on investments.......................... (52,275)
=============
NET ASSETS at value applicable to 317,892,053 shares outstanding
(unlimited number of $.001 par value shares of Beneficial Interest authorized)
$317,839,778
=============
NET ASSET VALUE, offering and redemption price per share
($317,839,778 / 317,892,053 shares)..................................... $1.00
=======
</TABLE>
<TABLE>
<CAPTION>
STATEMENT OF OPERATIONS YEAR ENDED MAY 31, 1995
<S> <C> <C>
INVESTMENT INCOME:
INTEREST INCOME......................................................... $ 11,097,535
EXPENSES:
Management fee-Note 2(a).............................................. $1,636,701
Shareholder servicing costs-Note 2(b)................................. 442,849
Professional fees..................................................... 50,876
Custodian fees........................................................ 26,955
Prospectus and shareholders' report................................... 18,544
Trustees' fees and expenses-Note 2(c)................................. 16,971
Registration fees..................................................... 6,480
Miscellaneous......................................................... 13,624
----------
TOTAL EXPENSES.................................................... 2,213,000
-------------
INVESTMENT INCOME-NET....................................................... 8,884,535
NET REALIZED (LOSS) ON INVESTMENTS-Note 1(b)................................ (26,195)
-------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS........................ $ 8,858,340
=============
</TABLE>
See notes to financial statements.
<TABLE>
<CAPTION>
DREYFUS NEW YORK TAX EXEMPT MONEY MARKET FUND
STATEMENT OF CHANGES IN NET ASSETS
YEAR ENDED MAY 31,
----------------------------------
1994 1995
--------------- ---------------
<S> <C> <C>
OPERATIONS:
Investment income-net................................................... $ 5,938,282 $ 8,884,535
Net realized (loss) on investments...................................... (10,006) (26,195)
--------------- ---------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS.................. 5,928,276 8,858,340
--------------- ---------------
DIVIDENDS TO SHAREHOLDERS FROM;
Investment income-net................................................... (5,938,282) (8,884,535)
--------------- ---------------
BENEFICIAL INTEREST TRANSACTIONS ($1.00 per share):
Net proceeds from shares sold........................................... 395,241,865 333,556,193
Dividends reinvested.................................................... 5,610,333 8,431,092
Cost of shares redeemed................................................. (436,693,846) (368,085,583)
--------------- ---------------
(DECREASE) IN NET ASSETS FROM BENEFICIAL INTEREST TRANSACTIONS........ (35,841,648) (26,098,298)
--------------- ---------------
TOTAL (DECREASE) IN NET ASSETS.................................... (35,851,654) (26,124,493)
NET ASSETS:
Beginning of year....................................................... 379,815,925 343,964,271
--------------- ---------------
End of year............................................................. $ 343,964,271 $ 317,839,778
=============== ===============
</TABLE>
See notes to financial statements.
DREYFUS NEW YORK TAX EXEMPT MONEY MARKET FUND
FINANCIAL HIGHLIGHTS
Reference is made to page 4 of the Prospectus dated September 1, 1995.
See notes to financial statements.
DREYFUS NEW YORK TAX EXEMPT MONEY MARKET FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DREYFUS NEW YORK TAX EXEMPT MONEY MARKET FUND
NOTES TO FINANCIAL STATEMENTS
NOTE 1-SIGNIFICANT ACCOUNTING POLICIES:
The Fund is registered under the Investment Company Act of 1940 ("Act")
as a non-diversified open-end management investment company. Dreyfus Service
Corporation, until August 24, 1994, acted as the exclusive distributor of the
Fund's shares, which are sold to the public without a sales charge. The
Dreyfus Service Corporation is a wholly-owned subsidiary of The Dreyfus
Corporation ("Manager"). Effective August 24, 1994, the Manager became a
direct subsidiary of Mellon Bank, N.A.
On August 24, 1994, Premier Mutual Fund Services, Inc. (the
"Distributor") was engaged as the Fund's distributor. The Distributor,
located at One Exchange Place, Boston, Massachusetts 02109, is a wholly-owned
subsidiary of FDI Distribution Services, Inc., a provider of mutual fund
administration services, which in turn is a wholly-owned subsidiary of FDI
Holdings, Inc. the parent company of which is Boston Institutional Group,
Inc.
It is the Fund's policy to maintain a continuous net asset value per
share of $1.00; the Fund has adopted certain investment, portfolio valuation
and dividend and distribution policies to enable it to do so. There is no
assurance, however, that the Fund will be able to maintain a stable net asset
value of $1.00.
(A) PORTFOLIO VALUATION: Investments are valued at amortized cost, which
has been determined by the Fund's Board of Trustees to represent the fair
value of the Fund's investments.
(B) SECURITIES TRANSACTIONS AND INVESTMENT INCOME: Securities
transactions are recorded on a trade date 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. Realized
gain and loss from securities transactions are recorded on the identified
cost basis.
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, if any, 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. To
the extent that net realized capital gain can be offset by capital loss
carryovers, it is the policy of the Fund not to distribute such gain.
(D) FEDERAL INCOME TAXES: It is the policy of the Fund to continue to
qualify as a regulated investment company, which can distribute tax exempt
dividends, by complying with the applicable provisions of the Internal
Revenue Code, and to make distributions of income and net realized capital
gain sufficient to relieve it from substantially all Federal income and
excise taxes.
The Fund has an unused capital loss carryover of approximately $45,000
available for Federal income tax purposes to be applied against future net
securities profits, if any, realized subsequent to May 31, 1995. The carryover
does not include net realized securities losses from November 1, 1994 through
May 31, 1995, which are treated, for Federal income tax purposes as arising in
fiscal 1996. If not applied, $15,000 expires in fiscal 1998, $1,000 expires in
fiscal 1999, $2,000 expires in fiscal 2002 and $27,000 expires in fiscal 2003.
At May 31, 1995, 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).
NOTE 2-MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATES:
(A) Pursuant to a management agreement ("Agreement") with the Manager,
the management fee is computed at the annual rate of .50 of 1% of the average
daily value of the Fund's net assets and is payable monthly. The Agreement
provides for an expense reimbursement from the Manager should the Fund's
aggregate expenses, exclusive of taxes, brokerage, interest on borrowings and
extraordinary expenses, exceed 1 1/2% of the average value of the Fund's net
assets for any full fiscal year. There was no expense reimbursement for the
year ended May 31, 1995.
(B) Pursuant to the Fund's Shareholder Services Plan, the Fund reimburses
Dreyfus Service Corporation an amount not to exceed an annual rate of .25 of
1% of the value of the Fund's average daily net assets for servicing
shareholder accounts. 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. During the year ended May
31, 1995, the Fund was charged an aggregate of $189,289 pursuant to the
Shareholder Services Plan.
(C) Prior to August 24, 1994, certain officers and trustees of the Fund
were "affiliated persons," as defined in the Act, of the Manager and/or
Dreyfus Service Corporation. Each trustee who is not an "affiliated person"
receives an annual fee of $1,500 and an attendance fee of $250 per meeting.
The Chairman of the Board receives an additional 25% of such compensation.
DREYFUS NEW YORK TAX EXEMPT MONEY MARKET FUND
REPORT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
SHAREHOLDERS AND BOARD OF TRUSTEES
DREYFUS NEW YORK TAX EXEMPT MONEY MARKET FUND
We have audited the accompanying statement of assets and liabilities of
Dreyfus New York Tax Exempt Money Market Fund, including the statement of
investments, as of May 31, 1995, and the related statement of operations for
the year then ended, the statement of changes in net assets for each of the
two years in the period then ended, and financial highlights for each of the
years indicated therein. 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 generally accepted auditing
standards. 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 May 31, 1995 by correspondence with the 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 a 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 Dreyfus New York Tax Exempt Money Market Fund, at May 31, 1995,
the results of its operations for the year then ended, the changes in its net
assets for each of the two years in the period then ended, and the financial
highlights for each of the indicated years, in conformity with generally
accepted accounting principles.
(Ernest & Young LLP Signature Logo )
New York, New York
July 7, 1995
<TABLE>
<CAPTION>
DREYFUS NEW YORK TAX EXEMPT INTERMEDIATE BOND FUND
STATEMENT OF INVESTMENTS MAY 31, 1995
PRINCIPAL
LONG-TERM MUNICIPAL INVESTMENTS-96.9% AMOUNT VALUE
-------------- --------------
<S> <C> <C>
NEW YORK-85.1%
Albany Industrial Development Agency, LR
(New York State Department of Health Building Project) 6.75%, 10/1/1995. $ 140,000 $ 140,731
Albany Parking Authority, Parking Revenue, Refunding:
6.50%, 11/1/2004........................................................ 1,000,000 1,074,140
6.70%, 11/1/2006........................................................ 1,000,000 1,072,780
Board Cooperative Educational Services, COP
(Greenport Vocational Facility Project) 7.50%, 10/1/1996................ 295,000 307,195
Buffalo Municipal Water Finance Authority, Water System Revenue
5.50%, 7/1/2005 (Insured; FSA).......................................... 1,200,000 1,238,364
Development Authority of the North Country, Solid Waste Management
System Revenue:
6.30%, 7/1/1999....................................................... 1,070,000 1,101,340
6.40%, 7/1/2000....................................................... 1,135,000 1,157,336
Franklin Industrial Development Agency, LR (County Correctional Facility
Project)
6.375%, 11/1/2002....................................................... 2,495,000 2,621,696
Franklin Solid Waste Management Authority, Solid Waste System Revenue
6%, 6/1/2005............................................................ 3,635,000 3,570,806
Grand Central District Management Association, Inc., Grand Central
Business Improvement District, Capital Improvement Refunding:
5.10%, 1/1/2008....................................................... 1,130,000 1,080,382
5.125%, 1/1/2009...................................................... 1,190,000 1,127,989
Metropolitan Transportation Authority:
Service Contract Transit Facilities:
7.25%, 7/1/1998....................................................... 2,550,000 2,753,898
6.90%, 7/1/2006....................................................... 3,615,000 3,890,355
Transit Facilities Revenue, Refunding:
4.90%, 7/1/2002 (Insured; AMBAC)...................................... 4,350,000 4,399,112
5%, 7/1/2003 (Insured; AMBAC)......................................... 3,210,000 3,256,738
5.10%, 7/1/2004 (Insured; AMBAC)...................................... 1,255,000 1,275,005
5.20%, 7/1/2005 (Insured; AMBAC)...................................... 5,650,000 5,747,350
5.30%, 7/1/2006 (Insured; AMBAC)...................................... 3,500,000 3,564,470
5.40%, 7/1/2007 (Insured; FGIC)....................................... 905,000 922,666
5.50%, 7/1/2008 (Insured; FGIC)....................................... 1,130,000 1,153,210
Nassau County, Refunding (Combined Sewer Districts)
5.30%, 7/1/2006 (Insured; MBIA)......................................... 4,860,000 4,949,521
New York City:
7.75%, 3/15/2004........................................................ 1,000,000 1,104,400
7.75%, 8/15/2004........................................................ 1,000,000 1,125,140
Refunding 5.75%, 8/1/2002 (Insured; MBIA)............................... 4,200,000 4,436,628
DREYFUS NEW YORK TAX EXEMPT INTERMEDIATE BOND FUND
STATEMENT OF INVESTMENTS (CONTINUED) MAY 31, 1995
PRINCIPAL
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) AMOUNT VALUE
-------------- --------------
NEW YORK (CONTINUED)
New York City Housing Development Corp., MFHR:
4.95%, 5/1/2002......................................................... $ 1,105,000 $ 1,078,115
5.05%, 5/1/2003......................................................... 1,140,000 1,113,791
5.15%, 5/1/2004......................................................... 1,000,000 978,290
New York City Industrial Development Agency, Revenue:
Civic Facility (YMCA of Greater New York Project) 7.25%, 8/1/1999....... 2,100,000 2,196,831
Industrial Development:
8%, Series I, 11/16/1998 (LOC; Algemene Bank Nederland) (a)........... 635,000 643,465
8%, Series J, 11/16/1998 (LOC; Algemene Bank Nederland) (a)........... 1,225,000 1,241,329
(Plaza Packaging Corp. Project)
7.65%, 12/1/2009 (LOC; Barclays Bank of New York) (a)............. 920,000 985,292
Special Facility
(Terminal One Group Association, L.P. Project):
5.60%, 1/1/2003................................................... 4,000,000 4,081,440
5.90%, 1/1/2006................................................... 4,000,000 4,059,480
6%, 1/1/2007...................................................... 2,980,000 2,977,348
New York City Municipal Water Finance Authority, Water and Sewer System
Revenue:
5.55%, 6/15/2001........................................................ 1,500,000 1,554,360
6.60%, 6/15/2002 (Prerefunded 6/15/2001) (b)............................ 3,000,000 3,339,300
5.375%, 6/15/2007 (Insured; AMBAC)...................................... 7,895,000 7,952,634
New York State:
5.625%, 6/15/1999....................................................... 2,000,000 2,079,200
6.75%, 11/15/2000....................................................... 2,000,000 2,198,240
Refunding 5.50%, 8/15/2006.............................................. 4,300,000 4,397,137
New York State Dormitory Authority, Revenue:
City University:
7.25%, 7/1/2002....................................................... 2,250,000 2,483,933
5.20%, 7/1/2005....................................................... 5,690,000 5,465,643
5.70%, 7/1/2005....................................................... 5,000,000 5,037,400
5.25%, 7/1/2006....................................................... 3,000,000 2,873,400
5.375%, 7/1/2007...................................................... 2,060,000 1,989,775
5.75%, 7/1/2009....................................................... 2,455,000 2,425,712
Refunding 6.25%, 7/1/2003............................................. 4,225,000 4,536,087
Columbia University 5.50%, 7/1/2005..................................... 3,045,000 3,181,446
Department of Health, Refunding 5.50%, 7/1/2005......................... 1,000,000 990,760
Highland Community Development Corp.
5.50%, 7/1/2001 (LOC; Marine Midland Bank) (a)........................ 3,500,000 3,526,810
State University Educational Facilities:
7%, 5/15/2000......................................................... 3,000,000 3,264,780
5.50%, 5/15/2005...................................................... 3,500,000 3,468,185
DREYFUS NEW YORK TAX EXEMPT INTERMEDIATE BOND FUND
STATEMENT OF INVESTMENTS (CONTINUED) MAY 31, 1995
PRINCIPAL
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) AMOUNT VALUE
-------------- --------------
NEW YORK (CONTINUED)
New York State Dormitory Authority, Revenue (continued):
State University Educational Facilities (continued):
6.10%, 5/15/2005...................................................... $ 2,630,000 $ 2,718,841
5.50%, 5/15/2008...................................................... 3,000,000 2,926,680
6.10%, 5/15/2008...................................................... 2,000,000 2,056,240
University of Rochester 6.10%, 7/1/2008................................. 1,115,000 1,169,903
New York State Energy Research and Development Authority,
State Service Contract Revenue (Western New York Nuclear Service Center
Project):
5.25%, 4/1/2003....................................................... 5,345,000 5,468,576
5.375%, 4/1/2004...................................................... 1,500,000 1,541,805
5.40%, 4/1/2005....................................................... 2,000,000 2,047,340
New York State Environmental Facilities Corp.:
PCR (State Water Revolving Fund):
7.30%, 6/15/2001...................................................... 4,000,000 4,505,760
6%, 5/15/2002......................................................... 1,200,000 1,286,460
6.30%, 6/15/2002...................................................... 3,000,000 3,251,130
6.20%, 3/15/2004...................................................... 1,700,000 1,856,128
6.30%, 3/15/2005...................................................... 1,800,000 1,966,410
6.60%, 6/15/2005...................................................... 3,120,000 3,339,180
7.20%, 6/15/2006...................................................... 3,000,000 3,310,350
(New York Municipal Water Finance Authority Project)
6.35%, 6/15/2006.................................................. 2,000,000 2,172,420
Special Obligation:
(Riverbank State Park) 7.10%, 4/1/2002................................ 1,130,000 1,246,582
(State Park Infrastructure) 5.75%, 3/15/2008.......................... 2,475,000 2,463,665
New York State Housing Finance Agency:
Revenue:
(Refunding- Health Facilities - New York City) 7.90%, 11/1/1999....... 2,250,000 2,517,930
(Suffolk-Help) 8%, 11/1/2001.......................................... 2,390,000 2,574,269
(Urban Rent) 5.90%, 11/1/2003........................................... 4,330,000 4,389,538
New York State Local Government Assistance Corp.:
6.70%, 4/1/2000......................................................... 2,490,000 2,699,509
6.75%, 4/1/2002......................................................... 2,500,000 2,776,325
Zero Coupon, 4/1/2005................................................... 3,865,000 2,308,178
4.80%, 4/1/2005......................................................... 7,500,000 7,226,025
5.70%, 4/1/2008......................................................... 3,000,000 3,051,420
New York State Medical Care Facilities Finance Agency, Revenue:
Hospital and Nursing Home:
(Catholic Medical Center) 7.60%, 8/15/1999 (Insured; FHA)
(Prerefunded 2/15/1998) (b)....................................... 1,000,000 1,102,790
5.875%, 2/15/2008 (Insured; FHA)...................................... 2,215,000 2,367,680
DREYFUS NEW YORK TAX EXEMPT INTERMEDIATE BOND FUND
STATEMENT OF INVESTMENTS (CONTINUED) MAY 31, 1995
PRINCIPAL
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) AMOUNT VALUE
-------------- --------------
NEW YORK (CONTINUED)
New York State Medical Care Facilities Finance Agency, Revenue (continued):
Insured Mortgage (Saint Luke's - Roosevelt Hospital Center):
4.75%, 2/15/2002 (Insured; FHA)....................................... $ 4,000,000 $ 3,894,480
4.75%, 8/15/2002 (Insured; FHA)....................................... 4,000,000 3,887,960
Mortgage Project 5.40%, 8/15/2005 (Insured; FHA)........................ 2,350,000 2,400,666
New York State Mortgage Agency, Revenue (Homeowner Mortgage):
5.85%, 10/1/1999........................................................ 1,075,000 1,104,219
6.05%, 10/1/2000........................................................ 1,150,000 1,188,974
6.15%, 10/1/2001........................................................ 1,225,000 1,270,288
7.25%, 10/1/2007........................................................ 2,450,000 2,626,033
New York State Power Authority,
General Purpose Revenue:
6.50%, 1/1/2004....................................................... 2,735,000 2,972,672
Refunding 5%, 1/1/2007................................................ 4,000,000 3,903,680
New York State Project Finance Agency 5%, 11/1/2007 (Insured; FHA).......... 2,650,000 2,527,199
New York State Thruway Authority:
(Emergency Highway Reconditioning and Preservation)
6%, 1/1/2002.......................................................... 2,000,000 2,132,840
General Revenue 5.70%, 1/1/2008 (Insured; FGIC)......................... 3,000,000 3,076,590
Local Highway and Bridge 5.75%, 4/1/2008................................ 3,200,000 3,179,648
Service Contract Revenue (Local Highway and Bridge):
6.80%, 1/1/2000....................................................... 1,920,000 2,062,234
7%, 1/1/2002.......................................................... 5,000,000 5,482,700
5.125%, 4/1/2007 (Insured; MBIA)...................................... 4,295,000 4,236,631
New York State Urban Development Corp.:
Project Revenue (Cornell Center for Theory and Simulation Science and
Engineering Grant) 5.90%, 1/1/2007.................................... 2,735,000 2,766,753
Revenue, Refunding (Correctional Facilities)
5.625%, 1/1/2007...................................................... 9,835,000 9,780,711
Niagara Falls 5.85%, 6/15/2001.............................................. 1,475,000 1,563,249
Oneida-Herkimer Solid Waste Management Authority, Solid Waste System Revenue
6.60%, 4/1/2004......................................................... 1,150,000 1,216,275
Onondaga County Industrial Development Agency, PCR, Refunding
(Anheuser-Busch Co. Inc. Project) 6.625%, 8/1/2006...................... 4,000,000 4,336,560
Oswego County 6.60%, 6/15/2004.............................................. 1,000,000 1,105,230
Port Authority of New York and New Jersey
(Consolidated Bonds 73rd Series) 6.75%, 10/15/2006...................... 2,000,000 2,177,180
Rensselaer Industrial Development Agency, IDR (Albany International Corp.)
7.55%, 6/1/2007 (LOC; Norstar Bank) (a)................................. 2,000,000 2,262,500
DREYFUS NEW YORK TAX EXEMPT INTERMEDIATE BOND FUND
STATEMENT OF INVESTMENTS (CONTINUED) MAY 31, 1995
PRINCIPAL
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) AMOUNT VALUE
-------------- --------------
NEW YORK (CONTINUED)
Suffolk County Industrial Development Agency, IDR, (Metavac Inc. Facilities)
7.25%, 12/1/1999 (LOC; Bank of Tokyo) (a)............................... $ 1,700,000 $ 1,756,627
Suffolk County Water Authority, Waterworks Revenue Refunding
5.10%, 6/1/2004 (Insured; MBIA)......................................... 4,500,000 4,538,745
Syracuse:
COP
(Syracuse Hancock International Airport):
6.50%, 1/1/2004................................................... 1,045,000 1,132,320
6.60%, 1/1/2005................................................... 1,105,000 1,207,334
6.70%, 1/1/2007................................................... 1,210,000 1,308,239
Public Improvement:
5.70%, 6/15/2004...................................................... 1,850,000 1,958,373
5.70%, 6/15/2005...................................................... 1,830,000 1,923,549
Triborough Bridge and Tunnel Authority,
General Purpose Revenue:
6%, 1/1/2006.......................................................... 2,250,000 2,352,960
Refunding 6.75%, 1/1/2009............................................. 1,000,000 1,128,700
Ulster County Resource Recovery Agency, Solid Waste System Revenue
5.90%, 3/1/2007......................................................... 1,235,000 1,239,396
Westchester County Industrial Development Agency, RRR, Refunding
(Resco Company Project) 5.50%, 7/1/2006 ................................ 2,850,000 2,928,432
U.S. RELATED-11.8%
Guam 5.10%, 11/15/2006...................................................... 4,000,000 3,767,880
Puerto Rico Public Improvement Refunding 5.20%, 7/1/2003.................... 3,600,000 3,618,036
Puerto Rico Electric Power Authority, Power Revenue 6%, 7/1/2002............ 2,500,000 2,650,725
Puerto Rico Highway and Transportation Authority, Highway Revenue, Refunding
5.35%, 7/1/2005......................................................... 10,000,000 9,877,200
Puerto Rico Housing Bank and Finance Agency, Subsidy Prepayment Refunding
(Commonwealth Appropriation) 5.125%, 12/1/2004.......................... 5,000,000 4,795,950
Puerto Rico Municipal Finance Agency 5.875%, 7/1/2007....................... 2,670,000 2,752,209
Puerto Rico Public Buildings Authority,
Guaranteed Public Education and Health Facilities, Refunding
5.50%, 7/1/2006......................................................... 2,875,000 2,898,575
Virgin Islands, Subordinated Special Tax (Insurance Claims Fund Program,
GO Matching Fund) 5.65%, 10/1/2003...................................... 5,530,000 5,630,590
Virgin Islands Port Authority, Airport Revenue (Cyril E. King Airport
Project)
7.875%, 10/1/1997....................................................... 1,475,000 1,573,839
Virgin Islands Public Finance Authority, Revenue, Refunding
Matching Fund Loan Notes 6.80%, 10/1/2000............................... 1,500,000 1,605,345
DREYFUS NEW YORK TAX EXEMPT INTERMEDIATE BOND FUND
STATEMENT OF INVESTMENTS (CONTINUED) MAY 31, 1995
PRINCIPAL
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) AMOUNT VALUE
-------------- --------------
U.S. RELATED (CONTINUED)
Virgin Islands Water and Power Authority, Electric System Revenue
6.90%, 7/1/1996......................................................... $ 2,595,000 $ 2,656,397
--------------
TOTAL LONG-TERM MUNICIPAL INVESTMENTS
(cost $330,224,193)..................................................... $341,989,262
==============
SHORT-TERM MUNICIPAL INVESTMENTS-3.1%
NEW YORK:
New York City, VRDN 4.20% (LOC; Chemical Bank) (a,c)........................ $ 3,100,000 $ 3,100,000
New York City Housing Development Corp., Mortgage Revenue, VRDN
(Residential-East 17th Street) 4.10%, (LOC; Chemical Bank) (a,c)........ 4,300,000 4,300,000
New York City Municipal Water Finance Authority, Water and Sewer System
Revenue,
VRDN 4% (Insured; FGIC) (c)............................................. 3,500,000 3,500,000
--------------
TOTAL SHORT-TERM MUNICIPAL INVESTMENTS
(cost $10,900,000)...................................................... $ 10,900,000
==============
TOTAL INVESTMENTS-100.0%
(cost $341,124,193)..................................................... $352,889,262
==============
</TABLE>
<TABLE>
<CAPTION>
DREYFUS NEW YORK TAX EXEMPT INTERMEDIATE BOND FUND
SUMMARY OF ABBREVIATIONS
<S> <C> <S> <C>
AMBAC American Municipal Bond Assurance Corporation LR Lease Revenue
COP Certificate of Participation MBIA Municipal Bond Investors Assurance
FGIC Financial Guaranty Insurance Company Insurance Corporation
FHA Federal Housing Administration MFHR Multi-Family Housing Revenue
FSA Financial Security Assurance PCR Pollution Control Revenue
GO General Obligation RRR Resources Recovery Revenue
IDR Industrial Development Revenue VRDN Variable Rate Demand Notes
LOC Letter of Credit
</TABLE>
<TABLE>
<CAPTION>
SUMMARY OF COMBINED RATINGS (UNAUDITED)
FITCH (D) OR MOODY'S OR STANDARD & POOR'S PERCENTAGE OF VALUE
- -------- -------- ------------------ --------------------
<S> <C> <C> <C>
AAA Aaa AAA 25.1%
AA Aa AA 14.2
A A A 27.8
BBB Baa BBB 26.0
F1 MIG1/P1 SP1/A1 3.1
Not Rated (e) Not Rated (e) Not Rated (e) 3.8
-------
100.0%
=======
</TABLE>
NOTES TO STATEMENT OF INVESTMENTS:
(a) Secured by letters of credit.
(b) 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.
(c) Securities payable on demand. The interest rate, which is subject to
change, is based upon bank prime rates or an index of market interest
rates.
(d) Fitch currently provides creditworthiness information for a limited
number of investments.
(e) Securities which, while not rated by Fitch, Moody's or Standard &
Poor's have been determined by the Manager to be of comparable quality to
those rated securities in which the Fund may invest.
See notes to financial statements.
<TABLE>
<CAPTION>
DREYFUS NEW YORK TAX EXEMPT INTERMEDIATE BOND FUND
STATEMENT OF ASSETS AND LIABILITIES MAY 31, 1995
ASSETS:
<S> <C> <C>
Investments in securities, at value
(cost $341,124,193)-see statement..................................... $352,889,262
Cash.................................................................... 438,311
Interest receivable..................................................... 6,362,219
Prepaid expenses........................................................ 6,420
-------------
359,696,212
LIABILITIES:
Due to The Dreyfus Corporation.......................................... $181,769
Due to Distributor...................................................... 75,870
Payable for shares of Beneficial Interest redeemed...................... 137,294
Accrued expenses........................................................ 102,673 497,606
---------- -------------
NET ASSETS ................................................................ $359,198,606
=============
REPRESENTED BY:
Paid-in capital......................................................... $348,620,766
Accumulated net realized (loss) on investments.......................... (1,187,229)
Accumulated net unrealized appreciation on investments-Note 3........... 11,765,069
-------------
NET ASSETS at value applicable to 19,898,157 shares outstanding
(unlimited number of $.001 par value shares of Beneficial
Interest authorized).................................................... $359,198,606
=============
NET ASSET VALUE, offering and redemption price per share
($359,198,606 / 19,898,157 shares)...................................... $18.05
=======
See notes to financial statements.
DREYFUS NEW YORK TAX EXEMPT INTERMEDIATE BOND FUND
STATEMENT OF OPERATIONS YEAR ENDED MAY 31, 1995
INVESTMENT INCOME:
INTEREST INCOME......................................................... $ 21,577,730
EXPENSES:
Management fee-Note 2(a).............................................. $2,204,128
Shareholder servicing costs-Note 2(b)................................. 1,160,746
Professional fees..................................................... 46,874
Custodian fees........................................................ 39,490
Trustees' fees and expenses-Note 2(c)................................. 30,521
Prospectus and shareholders' reports-Note 2(b)........................ 26,793
Registration fees..................................................... 7,059
Miscellaneous......................................................... 32,394
--------------
3,548,005
Less-reimbursement of prospectus costs-Note 2(b)...................... 4,426
--------------
TOTAL EXPENSES.................................................... 3,543,579
------------
INVESTMENT INCOME-NET............................................. 18,034,151
REALIZED AND UNREALIZED GAIN ON INVESTMENTS:
Net realized (loss) on investments-Note 3............................... $ (316,185)
Net unrealized appreciation on investments.............................. 5,287,113
--------------
NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS................... 4,970,928
-------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS........................ $ 23,005,079
=============
See notes to financial statements.
DREYFUS NEW YORK TAX EXEMPT INTERMEDIATE BOND FUND
STATEMENT OF CHANGES IN NET ASSETS
YEAR ENDED MAY 31,
------------------------------------
1994 1995
---------------- ----------------
OPERATIONS:
Investment income-net................................................... $ 18,786,157 $ 18,034,151
Net realized (loss) on investments...................................... (869,593) (316,185)
Net unrealized appreciation (depreciation) on investments for the year.. (9,167,410) 5,287,113
--------------- ---------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS.................. 8,749,154 23,005,079
--------------- ---------------
DIVIDENDS TO SHAREHOLDERS FROM:
Investment income-net................................................... (18,916,493) (18,034,151)
Net realized gain on investments........................................ (703,348) ---
--------------- ---------------
TOTAL DIVIDENDS....................................................... (19,619,841) (18,034,151)
--------------- ---------------
BENEFICIAL INTEREST TRANSACTIONS:
Net proceeds from shares sold........................................... 283,126,747 102,716,892
Dividends reinvested.................................................... 16,448,017 14,835,969
Cost of shares redeemed................................................. (214,699,800) (155,468,249)
--------------- ---------------
INCREASE (DECREASE) IN NET ASSETS FROM BENEFICIAL INTEREST TRANSACTIONS 84,874,964 (37,915,388)
--------------- ---------------
TOTAL INCREASE (DECREASE) IN NET ASSETS........................... 74,004,277 (32,944,460)
NET ASSETS:
Beginning of year....................................................... 318,138,789 392,143,066
--------------- ---------------
End of year............................................................. $ 392,143,066 $ 359,198,606
=============== ===============
SHARES SHARES
--------------- ---------------
CAPITAL SHARE TRANSACTIONS:
Shares sold............................................................. 15,416,722 5,899,261
Shares issued for dividends reinvested.................................. 898,331 851,555
Shares redeemed......................................................... (11,789,202) (8,998,947)
--------------- ---------------
NET INCREASE (DECREASE) IN SHARES OUTSTANDING......................... 4,525,851 (2,248,131)
=============== ===============
See notes to financial statements.
</TABLE>
DREYFUS NEW YORK TAX EXEMPT INTERMEDIATE BOND FUND
FINANCIAL HIGHLIGHTS
Reference is made to page 5 of the Prospectus dated September 1, 1995.
DREYFUS NEW YORK TAX EXEMPT INTERMEDIATE BOND FUND
NOTES TO FINANCIAL STATEMENTS
NOTE 1-SIGNIFICANT ACCOUNTING POLICIES:
The Fund is registered under the Investment Company Act of 1940 ("Act")
as a non-diversified open-end management investment company. Dreyfus Service
Corporation, until August 24, 1994, acted as the distributor of the Fund's
shares, which are sold to the public without a sales load. Dreyfus Service
Corporation is a wholly-owned subsidiary of The Dreyfus Corporation
("Manager"). Effective August 24, 1994, the Manager became a direct
subsidiary of Mellon Bank, N.A.
On August 24, 1994, Premier Mutual Fund Services, Inc. (the
"Distributor") was engaged as the Fund's distributor. The Distributor,
located at One Exchange Place, Boston, Massachusetts 02109, is a wholly-owned
subsidiary of FDI Distribution Services, Inc., a provider of mutual fund
administration services, which in turn is a wholly-owned subsidiary of FDI
Holdings, Inc., the parent company of which is Boston Institutional Group,
Inc.
(A) PORTFOLIO VALUATION: The Fund's investments 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.
(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.
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, if any, 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. To
the extent that net realized capital gain can be offset by capital loss
carryovers, it is the policy of the Fund not to distribute such gain.
(D) FEDERAL INCOME TAXES: It is the policy of the Fund to continue to
qualify as a regulated investment company, which can distribute tax exempt
dividends, by complying with the applicable provisions of the Internal
Revenue Code, and to make distributions of income and net realized capital
gain sufficient to relieve it from substantially all Federal income and
excise taxes.
DREYFUS NEW YORK TAX EXEMPT INTERMEDIATE BOND FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
The Fund has an unused capital loss carryover of approximately $1,186,000
available for Federal income tax purposes to be applied against future net
securities profits, if any, realized subsequent to
May 31, 1995. If not applied, $40,000 of the carryover expires in fiscal
2002, and $1,146,000 expires in fiscal 2003.
NOTE 2-MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATES:
(A) Pursuant to a management agreement ("Agreement") with the Manager,
the management fee is computed at the annual rate of .60 of 1% of the average
daily value of the Fund's net assets and is payable monthly. The Agreement
provides for an expense reimbursement from the Manager should the Fund's
aggregate expenses, exclusive of taxes, brokerage, interest on borrowings and
extraordinary expenses, exceed 1 1/2% of the average value of the Fund's net
assets for any full fiscal year. There was no expense reimbursement for the
year ended May 31, 1995.
(B) On August 2, 1994, Fund shareholders approved the adoption of a new
Service Plan (the "Plan") pursuant to Rule 12b-1 under the Act. Pursuant to
the Plan, effective August 24, 1994, the Fund (a) reimburses the Distributor
for payments to third parties for distributing the Fund's shares and
servicing shareholder accounts and (b) pays the Manager, Dreyfus Service
Corporation or any affiliate (collectively "Dreyfus") for advertising and
marketing relating to the Fund and servicing Shareholders accounts, at an
annual rate of .25 of 1% of the value of the Fund's average daily net assets.
Each of the Distributor and Dreyfus may pay Service Agents (a securities
dealer, financial institution or other industry professional) a fee in
respect of the Fund's shares owned by shareholders with whom the Service
Agent has a servicing relationship or for whom the Service Agent is the
dealer or holder of record. Each of the Distributor and Dreyfus determine the
amounts to be paid to Service Agents to which it will make payments and the
basis on which such payments are made. The Plan also separately provides for
the Fund to bear the costs of preparing, printing and distributing certain of
the Fund's prospectuses and statements of additional information and costs
associated with implementing and operating the Plan, not to exceed the
greater of $100,000 or .005 of 1% of the Fund's average daily net assets for
any full fiscal year.
Prior to August 24, 1994, the Fund's Service Plan ( "prior Service Plan")
provided that the Fund pay the Dreyfus Service Corporation at an annual rate
of .25 of 1% of the value of the Fund's average daily net assets, for costs
and expenses in connection with advertising, marketing and distributing the
Fund's shares and for servicing shareholder accounts. Dreyfus Service
Corporation made payments to one or more Service Agents based on the value of
the Fund's shares owned by clients of the Service Agents. The prior Service
Plan also separately provided for the Fund to bear the costs of preparing,
printing and distributing certain of the Fund's prospectuses and statements
of additional information and costs associated with implementing and
operating the prior Service Plan, not to exceed the greater of $100,000 or
.005 of 1% of the Fund's average daily net assets for any full fiscal year.
During the year ended May 31, 1995, $693,480 was charged to the Fund
pursuant to the Plan, of which $3,299 was waived by the Manager and $229,333
was charged pursuant to the prior Service Plan, of which $1,127 was waived by
the Manager.
DREYFUS NEW YORK TAX EXEMPT INTERMEDIATE BOND FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
(C) Prior to August 24, 1994, certain officers and trustees of the Fund
were "affiliated persons," as defined in the Act, of the Manager and/or
Dreyfus Service Corporation. Each trustee who is not an "affiliated person"
receives an annual fee of $2,500 and an attendance fee of $500 per meeting.
The Chairman of the Board receives an additional 25% of such compensation.
NOTE 3--SECURITIES TRANSACTIONS:
The aggregate amount of purchases and sales of investment securities
amounted to $253,457,784 and $290,404,637, respectively, for the year ended
May 31, 1995, and consisted entirely of long-term and short-term municipal
investments.
At May 31, 1995, accumulated net unrealized appreciation on investments
was $11,765,069, consisting of $13,476,736 gross unrealized appreciation and
$1,711,667 gross unrealized depreciation.
At May 31, 1995, the cost of investments for Federal income tax purposes
was substantially the same as the cost for financial reporting purposes (see
the Statement of Investments).
DREYFUS NEW YORK TAX EXEMPT INTERMEDIATE BOND FUND
REPORT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
SHAREHOLDERS AND BOARD OF TRUSTEES
DREYFUS NEW YORK TAX EXEMPT INTERMEDIATE BOND FUND
We have audited the accompanying statement of assets and liabilities of
Dreyfus New York Tax Exempt Intermediate Bond Fund, including the statement
of investments, as of May 31, 1995, and the related statement of operations
for the year then ended, the statement of changes in net assets for each of
the two years in the period then ended, and financial highlights for each of
the years indicated therein. 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 generally accepted auditing
standards. 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 May 31, 1995 by correspondence with the 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 a 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 Dreyfus New York Tax Exempt Intermediate Bond Fund at May 31,
1995, the results of its operations for the year then ended, the changes in
its net assets for each of the two years in the period then ended, and the
financial highlights for each of the indicated years, in conformity with
generally accepted accounting principles.
(Ernst & Young LLp Signature Logo)
New York, New York
June 30, 1995
<TABLE>
<CAPTION>
DREYFUS NEW YORK TAX EXEMPT BOND FUND, INC.
STATEMENT OF INVESTMENTS MAY 31, 1995
PRINCIPAL
LONG-TERM MUNICIPAL INVESTMENTS-94.1% AMOUNT VALUE
---------------- ----------------
<S> <C> <C>
NEW YORK-83.3%
Allegany County Industrial Development Agency, Solid Waste Disposal Facility
Revenue
(Atlantic Richfield Co. Facility) 6.625%, 9/1/2016...................... $ 5,600,000 $ 5,752,992
Cohoes Industrial Development Agency, IDR (Norlite Corp. Project)
6.75%, 5/1/2009 (LOC; Dresdner Bank)(a)................................. 5,000,000 5,227,600
Metropolitan Transportation Authority:
Service Contract, Transit Facilities 7.125%, 7/1/2009................... 5,000,000 5,461,950
Transit Facilities Revenue 5.50%, 7/1/2022 (Insured; FGIC).............. 24,000,000 23,534,880
Monroe County Industrial Development Agency, Revenue
(Genesee Hospital Civic Facility) 7%, 11/1/2018......................... 6,900,000 7,120,386
Municipal Assistance Corp. for the City of New York 7.30%, 7/1/2008......... 6,000,000 6,631,080
Nassau County Industrial Development Agency,IDR
(Hofstra University Project) 8.25%, 7/1/2003 (Prerefunded 7/1/1998)(b).. 3,000,000 3,343,170
New York City:
7.875%, 8/1/2000........................................................ 3,000,000 3,334,230
7.50%, 2/1/2003......................................................... 3,500,000 3,851,365
7.50%, 2/1/2006......................................................... 4,000,000 4,400,400
8.25%, 6/1/2006......................................................... 2,750,000 3,272,472
6.50%, 8/1/2007......................................................... 8,350,000 8,652,103
7.50%, 3/15/2009........................................................ 2,500,000 2,689,575
7.50%, 3/15/2010........................................................ 10,000,000 10,732,300
6.25%, 8/1/2010......................................................... 10,000,000 10,086,900
7%, 10/1/2010........................................................... 3,955,000 4,200,645
3.65%, 8/1/2011......................................................... 18,775,000 16,899,378
6.25%, 8/1/2011 (Insured; FSA) (Prerefunded 8/1/2002)(b)................ 3,950,000 4,386,514
5.75%, 8/15/2011........................................................ 11,870,000 11,350,806
6.85%, 10/1/2013........................................................ 5,000,000 5,144,200
7.50%, 8/1/2021......................................................... 5,000,000 5,446,600
New York City Health and Hospital Corp., Revenue
5.536%, 2/15/2011 (Insured; AMBAC)...................................... 24,000,000 23,691,120
New York City Housing Development Corp., MFHR 5.70%, 11/1/2013.............. 5,600,000 5,426,008
New York City Industrial Development Agency, Special Facility Revenue:
(Terminal One Group Assoc., L.P. Project) 6.125%, 1/1/2024.............. 48,325,000 47,584,661
New York City Municipal Water Finance Authority, Water and Sewer Systems
Revenue:
7%, 6/15/2015 (Prerefunded 6/15/2001)(b)................................ 5,655,000 6,431,940
5.50%, 6/15/2020........................................................ 29,210,000 27,763,521
6.20%, 6/15/2021 (Insured; AMBAC)....................................... 9,700,000 9,999,245
6.50%, 6/15/2021 (Insured; AMBAC)....................................... 8,200,000 8,557,930
6.50%, 6/15/2021 (Insured; AMBAC) (Prerefunded 6/15/1997)(b)............ 3,800,000 4,025,948
Refunding:
7%, 6/15/2015 (Prerefunded 6/15/2001)(b).............................. 2,440,000 2,775,232
6%, 6/15/2017......................................................... 8,000,000 8,032,880
DREYFUS NEW YORK TAX EXEMPT BOND FUND, INC.
STATEMENT OF INVESTMENTS (CONTINUED) MAY 31, 1995
PRINCIPAL
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) AMOUNT VALUE
---------------- ----------------
NEW YORK (CONTINUED)
State of New York:
5.50%, 3/1/2010......................................................... $ 5,265,000 $ 5,191,343
5.875%, 3/15/2014....................................................... 3,000,000 3,028,920
6.125%, 6/15/2014....................................................... 20,965,000 21,565,647
5.875%, 3/15/2015....................................................... 7,205,000 7,256,011
COP:
Commissioner General Services of the Executive Department 6.90%, 3/1/1998 2,030,000 2,153,079
Commissioner Office of Mental Health 8.30%, 9/1/2012.................. 4,000,000 4,384,680
Refunding:
5.625%, 8/15/2009..................................................... 15,000,000 15,123,750
5.70%, 8/15/2011...................................................... 4,500,000 4,515,255
6.125%, 11/15/2011.................................................... 3,130,000 3,233,008
New York State Dormitory Authority, Revenues:
(City University Systems):
7.875%, 7/1/2007 (Prerefunded 7/1/2000)(b)............................ 5,000,000 5,841,100
6.375%, 7/1/2008...................................................... 7,070,000 7,277,999
7%, 7/1/2009.......................................................... 8,500,000 9,428,455
5.60%, 7/1/2010....................................................... 12,000,000 11,619,720
7.50%, 7/1/2010 (Insured; FGIC)....................................... 5,000,000 6,061,950
5.50%, 7/1/2012....................................................... 23,625,000 22,420,361
5.75%, 7/1/2013....................................................... 10,000,000 9,747,300
8.125%, 7/1/2017 (Prerefunded 7/1/1997)(b)............................ 2,950,000 3,231,990
5.75%, 7/1/2018....................................................... 9,600,000 9,289,920
5%, 7/1/2020.......................................................... 34,500,000 29,932,890
Refunding:
5.75%, 7/1/2012................................................... 2,500,000 2,446,675
8.20%, 7/1/2012................................................... 5,250,000 5,904,360
(Cornell University) 7.375%, 7/1/2030................................... 11,785,000 13,165,259
Court Facilities Lease:
5.50%, 5/15/2010...................................................... 5,000,000 4,774,250
5.625%, 5/15/2013..................................................... 3,500,000 3,356,780
5.25%, 5/15/2021...................................................... 12,000,000 10,779,480
Department of Health, Refunding 5.50%, 7/1/2014......................... 10,000,000 9,414,100
(New York Medical College) 6.875%, 7/1/2021 (Insured; Asset Guaranty)... 19,310,000 20,816,566
(Park Ridge Housing Inc. Project) 7.85%, 2/1/2029....................... 7,720,000 8,516,550
(Rochester General Hospital)
8.75%, 2/1/2025 (Insured; FHA) (Prerefunded 8/1/1995)(b).............. 3,145,000 3,233,406
(Rochester Institute of Technology)
9.375%, 7/1/2003 (Collateralized; GNMA) (Prerefunded 7/1/1995)(b)..... 5,620,000 5,813,609
(State University):
7.60%, 7/1/2018....................................................... 3,000,000 3,224,340
DREYFUS NEW YORK TAX EXEMPT BOND FUND, INC.
STATEMENT OF INVESTMENTS (CONTINUED) MAY 31, 1995
PRINCIPAL
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) AMOUNT VALUE
---------------- ----------------
NEW YORK (CONTINUED)
New York State Dormitory Authority, Revenues (continued):
(State University) (continued):
Educational Facilities:
5.50%, 5/15/2008.................................................. $ 12,150,000 $ 11,853,054
7.25%, 5/15/2008 (Prerefunded 5/15/2000)(b)....................... 11,590,000 13,188,261
5.875%, 5/15/2011................................................. 20,000,000 19,968,400
7.50%, 5/15/2011.................................................. 3,750,000 4,356,112
5.50%, 5/15/2013.................................................. 3,000,000 2,852,160
6.25%, 5/15/2014.................................................. 18,000,000 18,255,780
6.375%, 5/15/2014................................................. 7,110,000 7,291,305
7.375%, 5/15/2014 (Prerefunded 5/15/2000)(b)...................... 10,155,000 11,621,077
6.25%, 5/15/2017.................................................. 9,000,000 9,112,680
7%, 5/15/2018 (Prerefunded 5/15/2000)(b).......................... 16,060,000 18,113,432
7.25%, 5/15/2018 (Prerefunded 5/15/2002)(b)....................... 16,065,000 18,782,073
5.40%, 5/15/2023.................................................. 20,390,000 18,663,579
5.75%, 5/15/2024.................................................. 15,140,000 14,562,258
Refunding 7.375%, 5/15/2014....................................... 12,945,000 14,012,574
New York State Energy Research and Development Authority:
Electric Facilities Revenue:
(Consolidated Edison Co. Project):
7.375%, 7/1/2024.................................................. 7,000,000 7,422,240
6.75%, 1/15/2027.................................................. 8,015,000 8,285,346
(Long Island Lighting):
7.15%, 9/1/2019................................................... 8,230,000 8,278,475
7.15%, 6/1/2020................................................... 4,000,000 4,023,560
Facilities Revenue (Consolidated Edison Co. Project):
6.375%, 12/1/2027..................................................... 23,715,000 24,048,433
6%, 3/15/2028......................................................... 32,600,000 32,273,348
7.125%, 12/1/2029..................................................... 13,000,000 14,123,460
Gas Facilities Revenue (Brooklyn Union Gas Co. Project):
8.75%, 7/1/2015....................................................... 19,750,000 20,212,545
7.125%,12/1/2020...................................................... 8,000,000 8,281,840
Solid Waste Disposal Revenue (New York State Electric and Gas Co.
Project)
5.70%, 12/1/2028...................................................... 17,320,000 16,841,102
New York State Environmental Facilities Corp.:
PCR 6.50%, 6/15/2014.................................................... 5,000,000 5,324,500
State Water Pollution Control Revolving Fund Revenue
(New York City Municipal Water Finance Authority Project):
6.875%, 6/15/2010................................................. 21,340,000 23,344,893
7.25%, 6/15/2010.................................................. 16,065,000 17,873,116
7%, 6/15/2012..................................................... 21,660,000 23,645,139
7.50%, 6/15/2012.................................................. 8,200,000 9,164,566
DREYFUS NEW YORK TAX EXEMPT BOND FUND, INC.
STATEMENT OF INVESTMENTS (CONTINUED) MAY 31, 1995
PRINCIPAL
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) AMOUNT VALUE
---------------- ----------------
NEW YORK (CONTINUED)
New York State Housing Finance Agency, Revenue:
(Adult Care) 7.85%, 2/15/2030 (Insured; FHA)............................ $ 2,045,000 $ 2,309,439
Insured Multi-Family Mortgage:
6.95%, 8/15/2012...................................................... 1,300,000 1,389,063
7%, 8/15/2022......................................................... 4,495,000 4,740,562
Multi-Family Housing Second Mortgage 6.95%, 8/15/2024 (Insured; FHA).... 2,970,000 3,119,837
Service Contract Obligation:
5.875%, 3/15/2011..................................................... 7,945,000 7,867,616
5.50%, 9/15/2022...................................................... 4,000,000 3,712,480
Refunding 5.375%, 9/15/2011........................................... 7,395,000 6,947,233
New York State Local Government Assistance Corp.:
7%, 4/1/2005............................................................ 4,300,000 4,801,509
6%, 4/1/2016............................................................ 12,540,000 12,687,094
6%, 4/1/2018............................................................ 43,030,000 43,436,634
7.25%, 4/1/2018 (Prerefunded 4/1/2001)(b)............................... 7,405,000 8,544,926
6%, 4/1/2024............................................................ 12,125,000 12,226,001
Refunding:
6%, 4/1/2014.......................................................... 5,125,000 5,385,709
5.50%, 4/1/2021....................................................... 21,215,000 20,393,767
New York State Medical Care Facilities Finance Agency, Revenue:
Hospital and Nursing Home Insured Mortgage:
6.45%, 2/15/2009 (Insured; FHA)....................................... 6,520,000 7,071,462
6.85%, 2/15/2012 (Insured; FHA)....................................... 6,000,000 6,391,380
6.125%, 2/15/2015 (Insured; FHA)...................................... 13,270,000 13,642,754
6.125%, 8/15/2024 (Insured; FHA) ..................................... 15,000,000 15,303,000
6.20%, 2/15/2028 (Insured; FHA)....................................... 7,000,000 7,189,840
6.375%, 8/15/2029 (Insured; FHA)...................................... 5,000,000 5,175,250
7.45%, 8/15/2031 (Insured; FHA)....................................... 4,250,000 4,649,202
Hospital and Nursing Home Mortgage (Saint Vincent's Hospital)
8%, 2/15/2027 (Insured; FHA) (Prerefunded 8/15/1997)(b)............... 2,500,000 2,664,650
Insured Hospital Mortgage:
(Hospital and Nursing Home Project) 10%, 11/1/2006.................... 4,585,000 4,834,424
(Kingston Hospital) 8.875%, 11/15/2017................................ 7,160,000 7,433,584
Refunding (Presbyterian Hospital) 5.375%, 2/15/2025 (Insured; FHA).... 9,500,000 8,835,285
Insured Long Term Health Care 6.45%, 11/1/2010 (Insured; Capital Guaranty) 11,660,000 12,668,473
Mental Health Services:
5.375%, 8/15/2013 (Insured; FGIC)..................................... 10,000,000 9,601,000
Refunding:
5.375%, 2/15/2014................................................. 16,000,000 15,584,480
5.25%, 2/15/2019 (Insured; FGIC).................................. 6,990,000 6,574,444
Mental Health Services Facilities Improvement
6%, 2/15/2025 (Insured; MBIA)......................................... 6,000,000 6,115,620
DREYFUS NEW YORK TAX EXEMPT BOND FUND, INC.
STATEMENT OF INVESTMENTS (CONTINUED) MAY 31, 1995
PRINCIPAL
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) AMOUNT VALUE
---------------- ----------------
NEW YORK (CONTINUED)
New York State Medical Care Facilities Finance Agency, Revenue (continued):
Mortgage:
(Montefiore Medical Center) 5.75%, 2/15/2015 (Insured: AMBAC,FHA)..... $ 8,750,000 $ 8,771,263
(New York Hospital) 6.50%, 8/15/2029 (Insured: AMBAC,FHA)............. 12,000,000 12,970,440
(Saint Lukes Hospital) 7.45%, 2/15/2029 (Insured; FHA)
(Prerefunded 2/15/2000)(b)........................................ 10,000,000 11,408,900
Secured Hospital 6.125%, 8/15/2013...................................... 10,000,000 9,800,200
New York State Mortgage Agency, Revenue Mortgage:
Homeowner:
7.375%, 10/1/2011..................................................... 13,260,000 14,266,036
5.50%, 4/1/2019....................................................... 5,000,000 4,760,650
6.60%, 10/1/2019...................................................... 10,685,000 11,074,468
6.45%, 10/1/2020...................................................... 18,235,000 18,701,451
6.65%, 4/1/2022 (Insured; FHA)........................................ 10,000,000 10,280,900
Homeownership 7.85%, 4/1/2022........................................... 5,000,000 5,303,050
New York State Power Authority, Revenue and General Purpose
6.625%, 1/1/2012........................................................ 5,690,000 6,151,630
New York State Thruway Authority:
General Revenue 6%, 1/1/2025 (Insured; FGIC)............................ 10,000,000 10,217,200
Service Contract Revenue (Local Highway and Bridge) 5.875%, 4/1/2014.... 5,200,000 5,126,732
New York State Township Authority, Service Contract Revenue
(Local Highway and Bridge):
7.25%, 1/1/2010....................................................... 13,000,000 14,017,900
6%, 4/1/2010.......................................................... 5,980,000 6,001,588
New York State Urban Development Corp., Revenue:
(Cornell Center Project) 6%, 1/1/2014................................... 4,500,000 4,479,750
(Correctional Facilities):
5.625%, 1/1/2007...................................................... 12,100,000 12,033,208
5.75%, 1/1/2013....................................................... 23,830,000 22,986,180
Onondaga County Industrial Development Agency, IDR (Weyerhaeuser Project)
9%, 10/1/2007........................................................... 1,000,000 1,255,670
Port Authority of New York and New Jersey:
(Consolidated Bond 53rd Series) 8.70%, 7/15/2020........................ 15,500,000 16,126,510
(Consolidated Bond 76th Series) 6.50%, 11/1/2026........................ 14,005,000 14,551,615
(Consolidated Bond 93rd Series) 6.125%, 6/1/2094........................ 14,500,000 15,074,200
Triborough Bridge and Tunnel Authority:
Capital Appreciation General Purpose:
Zero Coupon, 1/1/2012................................................. 3,835,000 1,496,417
Zero Coupon, 1/1/2013................................................. 3,925,000 1,434,980
Revenues:
7.375%, 1/1/2016 (Prerefunded 1/1/2000)(b)............................ 8,280,000 9,371,552
DREYFUS NEW YORK TAX EXEMPT BOND FUND, INC.
STATEMENT OF INVESTMENTS (CONTINUED) MAY 31, 1995
PRINCIPAL
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) AMOUNT VALUE
---------------- ----------------
NEW YORK (CONTINUED)
Triborough Bridge and Tunnel Authority (continued):
Revenues (continued):
General Purpose:
6%, 1/1/2012...................................................... $ 6,900,000 $ 7,240,998
5%, 1/1/2014...................................................... 10,750,000 10,045,660
6%, 1/1/2014...................................................... 11,625,000 11,781,705
6.50%, 1/1/2015 (Prerefunded 1/1/1999)(b)......................... 8,525,000 9,233,342
Special Obligation Refunding 7.10%, 1/1/2010............................ 6,000,000 6,605,280
U.S. RELATED-10.8%
Guam Airport Authority, Revenue:
6.60%, 10/1/2010........................................................ 4,000,000 4,141,880
6.70%, 10/1/2023........................................................ 6,200,000 6,380,792
Commonwealth of Puerto Rico, Public Improvement:
5.50%, 7/1/2001 (Insured; AMBAC)........................................ 10,000,000 10,483,200
7.70%, 7/1/2008 (Prerefunded 7/1/1999)(b)............................... 3,000,000 3,406,860
5.85%, 7/1/2011......................................................... 6,980,000 7,067,808
7.75%, 7/1/2017 (Prerefunded 7/1/1999)(b)............................... 4,850,000 5,516,730
6.80%, 7/1/2021 (Prerefunded 7/1/2002)(b)............................... 23,140,000 26,498,540
5.375%, 7/1/2022 (Insured; MBIA)........................................ 7,500,000 7,240,425
Puerto Rico Aqueduct and Sewer Authority, Revenue 10.25%, 7/1/2009.......... 13,750,000 19,350,375
Puerto Rico Electric Power Authority, Refunding:
6.10%, 7/1/2003......................................................... 5,000,000 5,336,100
8.375%, 7/1/2007 (Prerefunded 7/1/1997)(b).............................. 4,950,000 5,471,730
8.40%, 7/1/2015 (Prerefunded 7/1/1997)(b)............................... 6,700,000 7,410,937
Puerto Rico Highway and Transportation Authority,
Highway Revenue Refunding:
5.35%, 7/1/2005....................................................... 17,900,000 17,680,188
5.50%,7/1/2013........................................................ 8,125,000 7,880,275
Puerto Rico Highway Authority, Highway Revenue
8.125%, 7/1/2013 (Prerefunded 7/1/1998)(b).............................. 6,750,000 7,616,633
Puerto Rico Housing Finance Corp.:
MFMR:
7.50%, 10/1/2015 (LOC; Government Development Bank Puerto Rico)(a).... 5,475,000 5,837,336
7.50%, 4/1/2022 (LOC; Government Development Bank Puerto Rico)(a)..... 4,420,000 4,701,068
SFMR 6.562%, 8/4/2025................................................... 6,000,000 5,999,880
Puerto Rico Public Building Authority, Refunding
Guaranteed Public Education and Health Facilities
5.75%, 7/1/2010 (Insured; AMBAC)........................................ 35,355,000 36,916,277
Virigin Islands Public Finance Authority, Revenue Refunding Matching Fund
Loan Note
7.25%, 10/1/2018........................................................ 4,900,000 5,213,453
----------------
TOTAL LONG-TERM MUNICIPAL INVESTMENTS
(cost $1,647,460,361)................................................... $1,738,348,772
================
DREYFUS NEW YORK TAX EXEMPT BOND FUND, INC.
STATEMENT OF INVESTMENTS (CONTINUED) MAY 31, 1995
PRINCIPAL
SHORT-TERM MUNICIPAL INVESTMENTS-5.9% AMOUNT VALUE
---------------- ----------------
NEW YORK-5.8%
New York City, VRDN:
4.40% (c)............................................................... $ 12,000,000 $ 12,000,000
4.10% (SBPA; Citibank, N.A.)(c)......................................... 4,900,000 4,900,000
4.10% (Insured; MBIA, SBPA; Bank Austria)(c)............................ 4,100,000 4,100,000
4.45% (Insured; MBIA, SBPA; Westdeutsche Landesbank)(c)................. 3,500,000 3,500,000
4.10% (LOC; The Sumitomo Bank)(a,c)..................................... 4,700,000 4,700,000
4% (LOC; State Street Bank and Trust Co., N.A.)(a,c).................... 5,300,000 5,300,000
4.10% (LOC; Industrial Bank Japan)(a,c)................................. 3,200,000 3,200,000
4.20% (LOC; Chemical Bank)(a,c)......................................... 7,600,000 7,600,000
4.20% (LOC; Fuji Bank)(a,c)............................................. 10,000,000 10,000,000
New York City Health and Hospital Corp., Revenue VRDN:
4.06% (Insured; AMBAC)(c)............................................... 1,900,000 1,900,000
4.08% (Insured; AMBAC)(c)............................................... 2,200,000 2,200,000
New York City Municipal Water Finance Authority,
Water and Sewer Systems Revenue VRDN:
4% (Insured; FGIC, SBPA; FGIC Securities Purchase Inc.)(c)............ 28,600,000 28,600,000
4.10% (Insured; FGIC)(c).............................................. 5,600,000 5,600,000
New York State Energy Research and Development Authority, PCR
(New York State Electrical and Gas Co. Project) VRDN
4.10% (LOC; Morgan Guaranty Trust Co.)(a,c)............................. 5,000,000 5,000,000
New York State Environmental Facilities Corp., RRR VRDN
(Equity Hunington Project) 4.20% (LOC; Union Bank of Switzerland)(a,c).. 3,000,000 3,000,000
New York State Job Development Authority, State Guaranteed, VRDN
(Special Purpose) 4.10% (LOC; The Sumitomo Bank)(a,c)................... 6,580,000 6,580,000
U.S. RELATED-.1%
Commonwealth of Puerto Rico, 3.56% (Insured; AMBAC)(c)...................... 1,500,000 1,500,000
----------------
TOTAL SHORT-TERM MUNICIPAL INVESTMENTS
(cost $109,680,000)..................................................... $ 109,680,000
----------------
TOTAL INVESTMENTS-100.0%
(cost $1,757,140,361)................................................... $1,848,028,772
================
</TABLE>
<TABLE>
<CAPTION>
DREYFUS NEW YORK TAX EXEMPT BOND FUND, INC.
SUMMARY OF ABBREVIATIONS
<S> <C> <S> <C>
AMBAC American Municipal Bond Assurance Corporation MFHR Multi-Family Housing Revenue
COP Certificate of Participation MFMR Multi-Family Mortgage Revenue
FGIC Financial Guaranty Insurance Company PCR Pollution Control Revenue
FHA Federal Housing Administration RRR Resources Recovery Revenue
FSA Financial Security Assurance SBPA Standby Bond Purchase Agreement
GNMA Government National Mortgage Association SFMR Single-Family Mortgage Revenue
IDR Industrial Development Revenue VRDN Variable Rate Demand Notes
LOC Letter of Credit
MBIA Municipal Bond Investors Assurance
Insurance Corporation
</TABLE>
<TABLE>
<CAPTION>
SUMMARY OF COMBINED RATINGS (UNAUDITED)
FITCH (D) OR MOODY'S OR STANDARD & POOR'S PERCENTAGE OF VALUE
- --------- --------- -------------------- -----------------------
<S> <C> <C> <C>
AAA Aaa AAA 27.1%
AA Aa AA 21.0
A A A 28.2
BBB Baa BBB 17.7
BB Ba BB .7
F1 MIG1 SP1 5.0
Not Rated(e) Not Rated(e) Not Rated(e) .3
--------
100.0%
========
</TABLE>
NOTES TO STATEMENT OF INVESTMENTS:
(a) Secured by letters of credit.
(b) 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.
(c) Security payable on demand. The interest rate, which is subject to
change, is based upon bank prime rates or an index of market interest
rates.
(d) Fitch currently provides creditworthiness information for a limited
number of investments.
(e) Securities which, while not rated by Fitch, Moody's, or Standard &
Poor's, have been determined by the Manager to be of comparable quality
to those rated securities in which the Fund may invest.
See notes to financial statements.
<TABLE>
<CAPTION>
DREYFUS NEW YORK TAX EXEMPT BOND FUND, INC.
STATEMENT OF ASSETS AND LIABILITIES MAY 31, 1995
ASSETS:
<S> <C> <C>
Investments in securities, at value
(cost $1,757,140,361)-see statement................................... $1,848,028,772
Cash.................................................................... 11,419,905
Interest receivable..................................................... 33,033,063
Receivable for subscriptions to Common Stock............................ 20,000
Prepaid expenses........................................................ 17,944
----------------
1,892,519,684
LIABILITIES:
Due to The Dreyfus Corporation.......................................... $ 970,481
Payable for investment securities purchased............................. 11,954,173
Payable for Common Stock redeemed....................................... 118,897
Accrued expenses........................................................ 279,251 13,322,802
--------------- ----------------
NET ASSETS ................................................................ $1,879,196,882
================
REPRESENTED BY:
Paid-in capital......................................................... $1,792,626,391
Accumulated net realized capital losses and distributions in excess of
net realized gain on investments-Note 1(c)............................ (4,317,920)
Accumulated net unrealized appreciation on investments-Note 3........... 90,888,411
----------------
NET ASSETS at value applicable to 123,705,510 shares outstanding
(300 million shares of $.01 par value Common Stock authorized).......... $1,879,196,882
================
NET ASSET VALUE, offering and redemption price per share
($1,879,196,882 / 123,705,510 shares)................................... $15.19
=======
See notes to financial statements.
DREYFUS NEW YORK TAX EXEMPT BOND FUND, INC.
STATEMENT OF OPERATIONS YEAR ENDED MAY 31, 1995
INVESTMENT INCOME:
INTEREST INCOME......................................................... $117,075,312
EXPENSES:
Management fee-Note 2(a).............................................. $10,933,374
Shareholder servicing costs-Note 2(b)................................. 1,855,811
Custodian fees........................................................ 127,151
Prospectus and shareholders' reports.................................. 70,522
Professional fees..................................................... 45,115
Directors' fees and expenses-Note 2(c)................................ 44,450
Registration fees..................................................... 28,689
Miscellaneous......................................................... 91,114
-------------
TOTAL EXPENSES.................................................... 13,196,226
--------------
INVESTMENT INCOME-NET............................................. 103,879,086
REALIZED AND UNREALIZED GAIN ON INVESTMENTS:
Net realized (loss) on investments-Note 3............................... $(1,930,409)
Net unrealized appreciation on investments.............................. 29,915,882
-------------
NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS................... 27,985,473
--------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS........................ $131,864,559
==============
See notes to financial statements.
DREYFUS NEW YORK TAX EXEMPT BOND FUND, INC.
STATEMENT OF CHANGES IN NET ASSETS
YEAR ENDED MAY 31,
-----------------------------------------
1994 1995
-------------------- ------------------
OPERATIONS:
Investment income-net................................................ $ 114,666,514 $ 103,879,086
Net realized gain (loss) on investments.............................. 26,918,597 (1,930,409)
Net unrealized appreciation (depreciation) on investments for the year (107,463,939) 29,915,882
-------------------- ------------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS............... 34,121,172 131,864,559
-------------------- ------------------
DIVIDENDS TO SHAREHOLDERS:
From investment income-net........................................... (115,624,687) (103,879,086)
From net realized gain on investments................................ (49,331,298) (10,590,662)
In excess of net realized gain on investments........................ ---- (1,996,709)
-------------------- ------------------
TOTAL DIVIDENDS.................................................... (164,955,985) (116,466,457)
-------------------- ------------------
CAPITAL STOCK TRANSACTIONS:
Net proceeds from shares sold........................................ 944,177,818 1,842,837,132
Dividends reinvested................................................. 124,301,866 84,285,040
Cost of shares redeemed.............................................. (1,094,664,996) (2,004,556,426)
-------------------- ------------------
(DECREASE) IN NET ASSETS FROM CAPITAL STOCK TRANSACTIONS........... (26,185,312) (77,434,254)
-------------------- ------------------
TOTAL (DECREASE) IN NET ASSETS................................. (157,020,125) (62,036,152)
NET ASSETS:
Beginning of year.................................................... 2,098,253,159 1,941,233,034
-------------------- ------------------
End of year.......................................................... $ 1,941,233,034 $ 1,879,196,882
==================== ==================
SHARES SHARES
-------------------- ------------------
CAPITAL SHARE TRANSACTIONS:
Shares sold.......................................................... 59,571,940 126,069,512
Shares issued for dividends reinvested............................... 7,764,706 5,780,551
Share redeemed....................................................... (69,044,234) (137,056,900)
-------------------- ------------------
NET (DECREASE) IN SHARES OUTSTANDING............................... (1,707,588) (5,206,837)
==================== ==================
See notes to financial statements.
</TABLE>
DREYFUS NEW YORK TAX EXEMPT BOND FUND, INC.
FINANCIAL HIGHLIGHTS
Reference is made to page 5 of the Prospectus dated September 1, 1995.
DREYFUS NEW YORK TAX EXEMPT BOND FUND, INC.
NOTES TO FINANCIAL STATEMENTS
NOTE 1-SIGNIFICANT ACCOUNTING POLICIES:
The Fund is registered under the Investment Company Act of 1940 ("Act")
as a non-diversified open-end management investment company. Dreyfus Service
Corporation, until August 24, 1994, acted as the exclusive distributor of the
Fund's shares, which are sold to the public without a sales charge. Dreyfus
Service Corporation is a wholly-owned subsidiary of The Dreyfus Corporation
("Manager"). Effective August 24, 1994, the Manager became a direct
subsidiary of Mellon Bank, N.A.
On August 24, 1994, Premier Mutual Fund Services, Inc. (the
"Distributor") was engaged as the Fund's distributor. The Distributor,
located at One Exchange Place, Boston, Massachusetts 02109, is a wholly-owned
subsidiary of FDI Distribution Services, Inc., a provider of mutual fund
administration services, which in turn is a wholly-owned subsidiary of FDI
Holdings, Inc., the parent company of which is Boston Institutional Group,
Inc.
(A) PORTFOLIO VALUATION: The Fund's investments are valued each business
day by an independent pricing service ("Service") approved by the Board of
Directors. 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.
(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.
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. 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.
Dividends in excess of net realized gain on investments for financial
statement purposes result primarily from distributions of realized gain
necessary to satisfy tax requirements.
DREYFUS NEW YORK TAX EXEMPT BOND FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
(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 Internal Revenue 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-MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATES:
(A) Pursuant to a management agreement ("Agreement") with the Manager,
the management fee is computed at the annual rate of .60 of 1% of the average
daily value of the Fund's net assets and is payable monthly. The Agreement
provides for an expense reimbursement from the Manager should the Fund's
aggregate expenses, exclusive of taxes, interest on borrowings, brokerage
commissions and extraordinary expenses, exceed 1 1/2% of the average value of
the Fund's net assets for any full fiscal year. There was no expense
reimbursement for the year ended May 31, 1995.
(B) Pursuant to the Fund's Shareholder Services Plan, the Fund reimburses
Dreyfus Service Corporation an amount not to exceed an annual rate of .25 of
1% of the value of the Fund's average daily net assets for servicing
shareholder accounts. 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. During the year ended May
31, 1995, the Fund was charged an aggregate of $904,669 pursuant to the
Shareholder Services Plan.
(C) Prior to August 24, 1994, certain officers and directors of the Fund
were "affiliated persons," as defined in the Act, of the Manager and/or
Dreyfus Service Corporation. Each director who is not an "affiliated person"
receives an annual fee of $4,500 and an attendance fee of $500 per meeting.
The Chairman of the Board receives an additional 25% of such compensation.
NOTE 3-SECURITIES TRANSACTIONS:
The aggregate amount of purchases and sales of investment securities
amounted to $2,538,337,184 and $2,634,574,200, respectively, for the year
ended May 31, 1995, and consisted entirely of long-term and short-term
municipal investments.
At May 31, 1995, accumulated net unrealized appreciation on investments
was $90,888,411, consisting of $96,757,153 gross unrealized appreciation and
$5,868,742 gross unrealized depreciation.
At May 31, 1995, the cost of investments for Federal income tax purposes
was substantially the same as the cost for financial reporting purposes (see
the Statement of Investments).
DREYFUS NEW YORK TAX EXEMPT BOND FUND, INC.
REPORT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
SHAREHOLDERS AND BOARD OF DIRECTORS
DREYFUS NEW YORK TAX EXEMPT BOND FUND, INC.
We have audited the accompanying statement of assets and liabilities of
Dreyfus New York Tax Exempt Bond Fund, Inc., including the statement of
investments, as of May 31, 1995, and the related statement of operations for
the year then ended, the statement of changes in net assets for each of the
two years in the period then ended, and financial highlights for each of the
years indicated therein. 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 generally accepted auditing
standards. 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 May 31, 1995 by correspondence with the custodian and
brokers. 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 a
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 Dreyfus New York Tax Exempt Bond Fund, Inc. at May 31, 1995, the
results of its operations for the year then ended, the changes in its net
assets for each of the two years in the period then ended, and the financial
highlights for each of the indicated years, in conformity with generally
accepted accounting principles.
(Ernst & Young LLP Signature Logo)
New York, New York
June 28, 1995
DREYFUS NEW YORK TAX EXEMPT MONEY MARKET FUND
PART C. OTHER INFORMATION
_________________________
Item 24. Financial Statements and Exhibits. - List
_______ _________________________________________
(a) Financial Statements:
Included in Part A of the Registration Statement:
Condensed Financial Information
For the period June 9, 1987 (commencement of operations) to
May 31, 1988 and for each of the seven years in the period
ended May 31, 1995.
Included in Part B of the Registration Statement for the
Fund:
Statement of Investments--as of May 31, 1995.
Statement of Assets and Liabilities--as of May 31, 1995.
Statement of Operations--year ended May 31, 1995.
Statement of Changes in Net Assets--for the years ended
May 31, 1995 and 1994.
Notes to Financial Statements.
Report of Ernst & Young LLP, Independent Auditors, dated
July 7, 1995.
All Schedules and other financial statement information, for which provision
is made in the applicable accounting regulations of the Securities and
Exchange Commission, are either omitted because they are not required under
the related instructions, they are inapplicable, or the required information
is presented in the financial statements or notes thereto which are included
in Part B of the Registration Statement.
Item 24. Financial Statements and Exhibits. - List (continued)
_______ _____________________________________________________
(b) Exhibits:
(1)(a) Registrant's Agreement and Declaration of Trust and
Articles of Amendment.
Incorporated by reference to Exhibit 1 of the Registration
Statement filed under the Securities Act of 1933 on May 13, 1987.
(2) Registrant's By-Laws.
Incorporated by reference to Exhibit 2 of Post-Effective Amendment
No. 12 to the Registration Statement filed under the Securities
Act of 1933 on July 20, 1994.
(4) Registrant's Specimen share certificate.
Incorporated by reference to Exhibit 4 of the Registration
Statement filed under the Securities Act of 1933 on May 13, 1987.
(5) Management Agreement.
(6) Distribution Agreement.
(8)(a) Registrant's Amended and Restated Custody Agreement with The Bank
of New York.
Incorporated by reference to Exhibit 8(a) of Post-Effective
Amendment No. 4 to the Registration Statement filed under the
Securities Act of 1933 on September 26, 1990.
(b) Registrant's Forms of Sub-Custodian Agreements.
Incorporated by reference to Exhibits 8(b) through 8(e) of Post-
Effective Amendment No. 2 to the Registration Statement filed
under the Securities Act of 1933 on September 28, 1988.
(9) Shareholder Services Plan.
(10) Registrant's Opinion of Counsel of Stroock & Stroock & Lavan.
Incorporated by reference to Exhibit 10 of Pre-Effective Amendment
No. 1 to the Registration Statement filed under the Securities
Act of 1933 on June 1, 1987.
(11) Registrant's Consent of Ernst & Young, Independent Auditors.
(16) Registrant's Schedule of Calculation of Performance Data.
Incorporated by reference to Exhibit 16 of Post-Effective
Amendment No. 12 to the Registration Statement filed under the
Securities Act of 1933 on July 22, 1994.
Other Exhibits
(a) Powers of Attorney for Joseph S. DiMartino, Chairman of
the Board; David W. Burke, Samuel Chase, Gordon J.
Davis, Joni Evans, Arnold S. Hiatt, David J. Mahoney and
Burton N. Wallack, Board members; also for Marie E.
Connolly, President and Treasurer of the Fund.
(b) Registrant's Certificate of Assistant Secretary.
Item 25. Persons Controlled by or under Common Control with
Registrants
Not Applicable.
Item 26. Number of Holders of Securities of the Fund.
Number of Record
Title of Class Holders as of August 15, 1995
Shares of beneficial interest 7,538
(par value $.001 per share)
Item 27. Indemnification
Reference is made Article EIGHTH of the Agreement and Declaration
of Trust, as amended, for the Fund filed as Exhibit 1 to the
Registration Statement filed under the Securities Act of 1933 on
May 13, 1987. The application of these provisions is limited by
Article 10 of the By-Laws of the Fund, which was filed as Exhibit 2
to the Registration Statement and by the following undertaking set
forth in the rules promulgated by the Securities and Exchange
Commission.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers
and controlling persons of the Registrant pursuant to the
foregoing provisions, or otherwise, the Registrant has been
advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as
expressed in such Act and is, therefore, unenforceable. In the
event that a claim for indemnification against such liabilities
(other than the payment by the Registrant of expenses incurred
or paid by a director, officer or controlling person of the
Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, the
Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in
such Act and will be governed by the final adjudication of such
issue.
Reference is also made to the Distribution Agreement filed
as described in Item 24(b)(6) above.
Item 28. Business and Other Connections of the Fund's Investment Adviser
The Dreyfus Corporation ("Dreyfus") and subsidiary companies
comprise a financial service organization whose business
consists primarily of providing investment management services
as the investment adviser, manager and distributor for sponsored
investment companies registered under the Investment Company Act
of 1940 and as an investment adviser to institutional and
individual accounts. Dreyfus also serves as sub-investment
adviser to and/or administrator of other investment companies.
Dreyfus Service Corporation, a wholly-owned subsidiary of
Dreyfus, serves primarily as distributor of shares of investment
companies sponsored by Dreyfus and of other investment companies
for which Dreyfus acts as sub-investment adviser and
administrator. Dreyfus Management, Inc., another wholly-owned
subsidiary, provides investment management services to various
pension plans, institutions and individuals.
Item 28. Business and Other Connections of Investment Adviser (continued)
________ ________________________________________________________________
Officers and Directors of Investment Adviser
____________________________________________
Name and Position
with Dreyfus Other Businesses
_________________ ________________
MANDELL L. BERMAN Real estate consultant and private investor
Director 29100 Northwestern Highway, Suite 370
Southfield, Michigan 48034;
Past Chairman of the Board of Trustees of
Skillman Foundation.
Member of The Board of Vintners Intl.
FRANK V. CAHOUET Chairman of the Board, President and
Director Chief Executive Officer:
Mellon Bank Corporation
One Mellon Bank Center
Pittsburgh, Pennsylvania 15258;
Mellon Bank, N.A.
One Mellon Bank Center
Pittsburgh, Pennsylvania 15258
Director:
Avery Dennison Corporation
150 North Orange Grove Boulevard
Pasadena, California 91103;
Saint-Gobain Corporation
750 East Swedesford Road
Valley Forge, Pennsylvania 19482;
Teledyne, Inc.
1901 Avenue of the Stars
Los Angeles, California 90067
ALVIN E. FRIEDMAN Senior Adviser to Dillon, Read & Co. Inc.
Director 535 Madison Avenue
New York, New York 10022;
Director and member of the Executive
Committee of Avnet, Inc.**
LAWRENCE M. GREENE Director:
Director Dreyfus America Fund
JULIAN M. SMERLING None
Director
DAVID B. TRUMAN Educational consultant;
Director Past President of the Russell Sage Foundation
230 Park Avenue
New York, New York 10017;
Past President of Mount Holyoke College
South Hadley, Massachusetts 01075;
DAVID B. TRUMAN Former Director:
(cont'd) Student Loan Marketing Association
1055 Thomas Jefferson Street, N.W.
Washington, D.C. 20006;
Former Trustee:
College Retirement Equities Fund
730 Third Avenue
New York, New York 10017
HOWARD STEIN Chairman of the Board:
Chairman of the Board and Dreyfus Acquisition Corporation*;
Chief Executive Officer The Dreyfus Consumer Credit Corporation*;
Dreyfus Management, Inc.*;
Dreyfus Service Corporation*;
Chairman of the Board and Chief Executive
Officer:
Major Trading Corporation*;
Director:
Avnet, Inc.**;
Dreyfus America Fund++++;
The Dreyfus Fund International
Limited+++++;
World Balanced Fund+++;
Dreyfus Partnership Management,
Inc.*;
Dreyfus Personal Management, Inc.*;
Dreyfus Precious Metals, Inc.*;
Dreyfus Service Organization, Inc.*;
Seven Six Seven Agency, Inc.*;
Trustee:
Corporate Property Investors
New York, New York;
W. KEITH SMITH Chairman and Chief Executive Officer:
Vice Chairman of the Board The Boston Company
One Boston Place
Boston, Massachusetts 02108
Vice Chairman of the Board:
Mellon Bank Corporation
One Mellon Bank Center
Pittsburgh, Pennsylvania 15258;
Mellon Bank, N.A.
One Mellon Bank Center
Pittsburgh, Pennsylvania 15258
Director:
Dentsply International, Inc.
570 West College Avenue
York, Pennsylvania 17405
ROBERT E. RILEY Director:
President, Chief Dreyfus Service Corporation*;
Operating Officer, Former Executive Vice President:
and a Director Prudential Investment Corporation
751 Board Street
Newark, New Jersey 07102
STEPHEN E. CANTER Former Chairman and Chief Executive Officer:
Vice Chairman and Kleinwort Benson Investment Management
Chief Investment Officer, Americas Inc.*;
and a Director
LAWRENCE S. KASH Chairman, President and Chief
Vice Chairman-Distribution Executive Officer:
and a Director The Boston Company Advisors, Inc.
53 State Street
Exchange Place
Boston, Massachusetts 02109
Executive Vice President and Director:
Dreyfus Service Organization, Inc.*;
Director:
The Dreyfus Consumer Credit Corporation*;
The Dreyfus Trust Company++'
Dreyfus Service Corporation*;
President:
The Boston Company
One Boston Place
Boston, Massachusetts 02108;
Laurel Capital Advisors
One Mellon Bank Center
Pittsburgh, Pennsylvania 15258;
Boston Group Holdings, Inc.
Executive Vice President
Mellon Bank, N.A.
One Mellon Bank Center
Pittsburgh, Pennsylvania 15258;
Boston Safe Deposit & Trust
One Boston Place
Boston, Massachusetts 02108
PHILIP L. TOIA Chairman of the Board and Trust Investment
Vice Chairman-Operations Officer:
and Administration The Dreyfus Trust Company+++;
Chairman of the Board and Chief Executive
Officer:
Major Trading Corporation*;
Director:
The Dreyfus Security Savings Bank F.S.B.+;
Dreyfus Service Corporation*;
Seven Six Seven Agency, Inc.*;
President and Director:
Dreyfus Acquisition Corporation*;
The Dreyfus Consumer Credit Corporation*;
Dreyfus-Lincoln, Inc.*;
Dreyfus Management, Inc.*;
Dreyfus Personal Management, Inc.*;
Dreyfus Partnership Management, Inc.+;
Dreyfus Service Organization*;
The Truepenny Corporation*;
PHILIP L. TOIA Formerly, Senior Vice President:
(cont'd) The Chase Manhattan Bank, N.A. and
The Chase Manhattan Capital Markets
Corporation
One Chase Manhattan Plaza
New York, New York 10081
BARBARA E. CASEY President:
Vice President- Dreyfus Retirement Services Division;
Dreyfus Retirement Executive Vice President:
Services Boston Safe Deposit & Trust Co.
One Boston Place
Boston, Massachusetts 02108;
DIANE M. COFFEY None
Vice President-
Corporate Communications
ELIE M. GENADRY President:
Vice President- Institutional Services Division of Dreyfus
Institutional Sales Service Corporation*;
Broker-Dealer Division of Dreyfus Service
Corporation*;
Group Retirement Plans Division of Dreyfus
Service Corporation;
Executive Vice President:
Dreyfus Service Corporation*;
Dreyfus Service Organization, Inc.*;
Vice President:
The Dreyfus Trust Company++;
HENRY D. GOTTMANN Executive Vice President:
Vice President-Retail Dreyfus Service Corporation*;
Sales and Service Vice President:
Dreyfus Precious Metals*;
DANIEL C. MACLEAN Director, Vice President and Secretary:
Vice President and General Dreyfus Precious Metals, Inc.*;
Counsel Director and Vice President:
The Dreyfus Consumer Credit Corporation*;
Director and Secretary:
Dreyfus Partnership Management, Inc.*;
Major Trading Corporation*;
The Truepenny Corporation+;
Director:
The Dreyfus Trust Company++;
DANIEL C. MACLEAN Secretary:
(cont'd) Seven Six Seven Agency, Inc.*;
JEFFREY N. NACHMAN None
Vice President-Mutual Fund
Accounting
WILLIAM F. GLAVIN, JR. Senior Vice President:
Vice President-Corporate The Boston Company Advisors, Inc.
Development 53 State Street
Exchange Place
Boston, Massachusetts 02109
KATHERINE C. WICKHAM Formerly, Assistant Commissioner:
Vice President- Department of Parks and Recreation of the
Human Resources City of New York
830 Fifth Avenue
New York, New York 10022
MARK N. JACOBS Vice President, Secretary and Director:
Vice President-Fund Lion Management, Inc.*;
Legal and Compliance, Secretary:
and Secretary The Dreyfus Consumer Credit Corporation*;
Dreyfus Management, Inc.*;
Assistant Secretary:
Dreyfus Service Organization, Inc.*;
Major Trading Corporation*;
The Truepenny Corporation*
ANDREW S. WASSER Vice President:
Vice President-Information Mellon Bank Corporation
Services One Mellon Bank Center
Pittsburgh, Pennsylvania 15258
MAURICE BENDRIHEM Treasurer:
Controller Dreyfus Partnership Management, Inc.*;
Dreyfus Service Organization, Inc.*;
Seven Six Seven Agency, Inc.*;
The Truepenny Corporation*;
Controller:
Dreyfus Acquisition Corporation*;
The Dreyfus Trust Company++;
The Dreyfus Consumer Credit Corporation*;
Assistant Treasurer:
Dreyfus Precious Metals*
Formerly, Vice President-Financial Planning,
Administration and Tax:
Showtime/The Movie Channel, Inc.
1633 Broadway
New York, New York 10019
ELVIRA OSLAPAS Assistant Secretary:
Assistant Secretary Dreyfus Service Corporation*;
Dreyfus Management, Inc.*;
Dreyfus Acquisition Corporation, Inc.*;
The Truepenny Corporation+;
______________________________________
* The address of the business so indicated is 200 Park Avenue, New
York, New York 10166.
** The address of the business so indicated is 80 Cutter Mill Road,
Great Neck, New York 11021.
+ The address of the business so indicated is Atrium Building, 80 Route
4 East, Paramus, New Jersey 07652.
++ The address of the business so indicated is 144 Glenn Curtiss
Boulevard, Uniondale, New York 11556-0144.
+++ The address of the business so indicated is One Rockefeller Plaza,
New York, New York 10020.
++++ The address of the business so indicated is 2 Boulevard Royal,
Luxembourg.
+++++ The address of the business so indicated is Nassau, Bahama Islands.
Item 29. Principal Underwriters
________ ______________________
(a) Other investment companies for which Registrant's principal
underwriter (exclusive distributor) acts as principal underwriter or
exclusive distributor:
1) Comstock Partners Strategy Fund, Inc.
2) Dreyfus A Bonds Plus, Inc.
3) Dreyfus Appreciation Fund, Inc.
4) Dreyfus Asset Allocation Fund, Inc.
5) Dreyfus Balanced Fund, Inc.
6) Dreyfus BASIC Money Market Fund, Inc.
7) Dreyfus BASIC Municipal Fund, Inc.
8) Dreyfus BASIC U.S. Government Money Market Fund
9) Dreyfus California Intermediate Municipal Bond Fund
10) Dreyfus California Tax Exempt Bond Fund, Inc.
11) Dreyfus California Tax Exempt Money Market Fund
12) Dreyfus Capital Value Fund, Inc.
13) Dreyfus Cash Management
14) Dreyfus Cash Management Plus, Inc.
15) Dreyfus Connecticut Intermediate Municipal Bond Fund
16) Dreyfus Connecticut Municipal Money Market Fund, Inc.
17) The Dreyfus Convertible Securities Fund, Inc.
18) Dreyfus Edison Electric Index Fund, Inc.
19) Dreyfus Florida Intermediate Municipal Bond Fund
20) Dreyfus Florida Municipal Money Market Fund
21) Dreyfus Focus Funds, Inc.
22) The Dreyfus Fund Incorporated
23) Dreyfus Global Bond Fund, Inc.
24) Dreyfus Global Growth, L.P. (A Strategic Fund)
25) Dreyfus Global Investing, Inc.
26) Dreyfus GNMA Fund, Inc.
27) Dreyfus Government Cash Management
28) Dreyfus Growth and Income Fund, Inc.
29) Dreyfus Growth Opportunity Fund, Inc.
30) Dreyfus Institutional Money Market Fund
31) Dreyfus Institutional Short Term Treasury Fund
32) Dreyfus Insured Municipal Bond Fund, Inc.
33) Dreyfus Intermediate Municipal Bond Fund, Inc.
34) Dreyfus International Equity Fund, Inc.
35) Dreyfus Investors GNMA Fund
36) The Dreyfus/Laurel Funds, Inc.
37) The Dreyfus/Laurel Funds Trust
38) The Dreyfus/Laurel Tax-Free Municipal Funds
39) The Dreyfus/Laurel Investment Series
40) The Dreyfus Leverage Fund, Inc.
41) Dreyfus Life and Annuity Index Fund, Inc.
42) Dreyfus Liquid Assets, Inc.
43) Dreyfus Massachusetts Intermediate Municipal Bond Fund
44) Dreyfus Massachusetts Municipal Money Market Fund
45) Dreyfus Massachusetts Tax Exempt Bond Fund
46) Dreyfus Michigan Municipal Money Market Fund, Inc.
47) Dreyfus Money Market Instruments, Inc.
48) Dreyfus Municipal Bond Fund, Inc.
49) Dreyfus Municipal Cash Management Plus
50) Dreyfus Municipal Money Market Fund, Inc.
51) Dreyfus New Jersey Intermediate Municipal Bond Fund
52) Dreyfus New Jersey Municipal Bond Fund, Inc.
53) Dreyfus New Jersey Municipal Money Market Fund, Inc.
54) Dreyfus New Leaders Fund, Inc.
55) Dreyfus New York Insured Tax Exempt Bond Fund
56) Dreyfus New York Municipal Cash Management
57) Dreyfus New York Tax Exempt Bond Fund, Inc.
58) Dreyfus New York Tax Exempt Intermediate Bond Fund
59) Dreyfus Ohio Municipal Money Market Fund, Inc.
60) Dreyfus 100% U.S. Treasury Intermediate Term Fund
61) Dreyfus 100% U.S. Treasury Long Term Fund
62) Dreyfus 100% U.S. Treasury Money Market Fund
63) Dreyfus 100% U.S. Treasury Short Term Fund
64) Dreyfus Pennsylvania Intermediate Municipal Bond Fund
65) Dreyfus Pennsylvania Municipal Money Market Fund
66) Dreyfus Short-Intermediate Government Fund
67) Dreyfus Short-Intermediate Municipal Bond Fund
68) Dreyfus Short-Term Income Fund, Inc.
69) The Dreyfus Socially Responsible Growth Fund, Inc.
70) Dreyfus Strategic Growth, L.P.
71) Dreyfus Strategic Income
72) Dreyfus Strategic Investing
73) Dreyfus Tax Exempt Cash Management
74) Dreyfus Treasury Cash Management
75) Dreyfus Treasury Prime Cash Management
76) Dreyfus Variable Investment Fund
77) Dreyfus-Wilshire Target Funds, Inc.
78) Dreyfus Worldwide Dollar Money Market Fund, Inc.
79) General California Municipal Bond Fund, Inc.
80) General California Municipal Money Market Fund
81) General Government Securities Money Market Fund, Inc.
82) General Money Market Fund, Inc.
83) General Municipal Bond Fund, Inc.
84) General Municipal Money Market Fund, Inc.
85) General New York Municipal Bond Fund, Inc.
86) General New York Municipal Money Market Fund
87) Pacifica Funds Trust -
Pacific American Money Market Portfolio
Pacific American U.S. Treasury Portfolio
88) Peoples Index Fund, Inc.
89) Peoples S&P MidCap Index Fund, Inc.
90) Premier Insured Municipal Bond Fund
91) Premier California Municipal Bond Fund
92) Premier GNMA Fund
93) Premier Growth Fund, Inc.
94) Premier Municipal Bond Fund
95) Premier New York Municipal Bond Fund
96) Premier State Municipal Bond Fund
(b)
Positions and
Name and principal Positions and offices with offices with
business address the Distributor Registrant
__________________ ___________________________ _____________
Marie E. Connolly+ Director, President, Chief President and
Operating Officer and Compliance Treasurer
Officer
Joseph F. Tower, III+ Senior Vice President, Treasurer Assistant
and Chief Financial Officer Treasurer
John E. Pelletier+ Senior Vice President, General Vice President
Counsel, Secretary and Clerk and Secretary
Frederick C. Dey++ Senior Vice President Vice President
and Assistant
Treasurer
Eric B. Fischman++ Vice President and Associate Vice President
General Counsel and Assistant
Secretary
Lynn H. Johnson+ Vice President None
Ruth D. Leibert++ Assistant Vice President Assistant
Secretary
Paul Prescott+ Assistant Vice President None
Leslie M. Gaynor+ Assistant Treasurer None
Mary Nelson+ Assistant Treasurer None
John J. Pyburn++ Assistant Treasurer Assistant
Treasurer
Jean M. O'Leary+ Assistant Secretary and None
Assistant Clerk
John W. Gomez+ Director None
William J. Nutt+ Director None
________________________________
+ Principal business address is One Exchange Place, Boston, Massachusetts
02109.
++ Principal business address is 200 Park Avenue, New York, New York 10166.
Item 30. Location of Accounts and Records
________________________________
1. The Shareholder Services Group, Inc.,
a subsidiary of First Data Corporation
P.O. Box 9671
Providence, Rhode Island 02940-9671
2. The Bank of New York
90 Washington Street
New York, New York 10286
3. The Dreyfus Corporation
200 Park Avenue
New York, New York 10166
Item 31. Management Services
_______ ___________________
Not Applicable
Item 32. Undertakings
________ ____________
(1) To call a meeting of shareholders for the purpose of voting upon
the question of removal of a director or directors when
requested in writing to do so by the holders of at least 10% of
the Registrant's outstanding shares of common stock and in
connection with such meeting to comply with the provisions of
Section 16(c) of the Investment Company Act of 1940 relating to
shareholder communications.
(2) To furnish each person to whom a prospectus is delivered with a
copy of the Fund's latest Annual Report to Shareholders, upon
request and without charge.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant certifies that it meets all
of the requirements for effectiveness of this Amendment to the Registration
Statement pursuant to Rule 485(b) under the Securities Act of 1933 and has
duly caused this Amendment to the Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of New
York, and State of New York on the day of August, 1995.
DREYFUS NEW YORK TAX EXEMPT MONEY MARKET FUND
BY: /s/Marie E. Connolly*
__________________________________________
Marie E. Connolly, PRESIDENT
Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, this Amendment to the Registration Statement
has been signed below by the following persons in the capacities and on the
dates indicated.
Signatures Title Date
__________________________ _______________________________ _________
/s/Marie E. Connolly* President and Treasurer 8/ /95
______________________________ (Principal Executive Officer,
Marie E. Connolly Financial and Accounting Officer)
/s/Joseph S. DiMartino* Chairman of the Board 8/ /95
_____________________________
Joseph S. DiMartino
/s/David W. Burke* Board member 8/ /95
______________________________
David W. Burke
/s/Samuel Chase* Board member 8/ /95
_____________________________
Samuel Chase
/s/Gordon J. Davis* Board member 8/ /95
_____________________________
Gordon J. Davis
/s/Joni Evans* Board member 8/ /95
_____________________________
Joni Evans
/s/Arnold S. Hiatt* Board member 8/ /95
_____________________________
Arnold S. Hiatt
/s/David J. Mahoney* Board member 8/ /95
_____________________________
David J. Mahoney
/s/Burton N. Wallack* Board member 8/ /95
_____________________________
Burton N. Wallack
*BY: __________________________
Eric B. Fischman,
Attorney-in-Fact
EXHIBIT INDEX
Exhibit No.
24(b)(5) Management Agreement
24(b)(6) Distribution Agreement
24(b)(9) Shareholder Services Plan
24(b)(11) Consent of Ernst & Young LLP
Other Powers of Attorney
Certificate of Assistant Secretary
MANAGEMENT AGREEMENT
DREYFUS NEW YORK TAX EXEMPT MONEY MARKET FUND
August 24, 1994
The Dreyfus Corporation
200 Park Avenue
New York, New York 10166
Dear Sirs:
The above-named investment company (the "Fund")
herewith confirms its agreement with you as follows:
The Fund desires to employ its capital by investing and
reinvesting the same in investments of the type and in accordance
with the limitations specified in its charter documents and in
its Prospectus and Statement of Additional Information as from
time to time in effect, copies of which have been or will be
submitted to you, and in such manner and to such extent as from
time to time may be approved by the Fund's Board. The Fund
desires to employ you to act as its investment adviser.
In this connection it is understood that from time to
time you will employ or associate with yourself such person or
persons as you may believe to be particularly fitted to assist
you in the performance of this Agreement. Such person or persons
may be officers or employees who are employed by both you and the
Fund. The compensation of such person or persons shall be paid
by you and no obligation may be incurred on the Fund's behalf in
any such respect.
Subject to the supervision and approval of the Fund's
Board, you will provide investment management of the Fund's
portfolio in accordance with the Fund's investment objectives and
policies as stated in its Prospectus and Statement of Additional
Information as from time to time in effect. In connection
therewith, you will obtain and provide investment research and
will supervise the Fund's investments and conduct a continuous
program of investment, evaluation and, if appropriate, sale and
reinvestment of the Fund's assets. You will furnish to the Fund
such statistical information, with respect to the investments
which the Fund may hold or contemplate purchasing, as the Fund
may reasonably request. The Fund wishes to be informed of
important developments materially affecting its portfolio and
shall expect you, on your own initiative, to furnish to the Fund
from time to time such information as you may believe appropriate
for this purpose.
In addition, you will supply office facilities (which
may be in your own offices), data processing services, clerical,
accounting and bookkeeping services, internal auditing and legal
services, internal executive and administrative services, and
stationery and office supplies; prepare reports to the Fund's
stockholders, tax returns, reports to and filings with the
Securities and Exchange Commission and state Blue Sky
authorities; calculate the net asset value of the Fund's shares;
and generally assist in all aspects of the Fund's operations.
You shall have the right, at your expense, to engage other
entities to assist you in performing some or all of the
obligations set forth in this paragraph, provided each such
entity enters into an agreement with you in form and substance
reasonably satisfactory to the Fund. You agree to be liable for
the acts or omissions of each such entity to the same extent as
if you had acted or failed to act under the circumstances.
You shall exercise your best judgment in rendering the
services to be provided to the Fund hereunder and the Fund agrees
as an inducement to your undertaking the same that you shall not
be liable hereunder for any error of judgment or mistake of law
or for any loss suffered by the Fund, provided that nothing
herein shall be deemed to protect or purport to protect you
against any liability to the Fund or to its security holders to
which you would otherwise be subject by reason of willful
misfeasance, bad faith or gross negligence in the performance of
your duties hereunder, or by reason of your reckless disregard of
your obligations and duties hereunder.
In consideration of services rendered pursuant to this
Agreement, the Fund will pay you on the first business day of
each month a fee at the annual rate of .50 of 1% of the value of
the Fund's average daily net assets. Net asset value shall be
computed on such days and at such time or times as described in
the Fund's then-current Prospectus and Statement of Additional
Information. Upon any termination of this Agreement before the
end of any month, the fee for such part of a month shall be pro-
rated according to the proportion which such period bears to the
full monthly period and shall be payable upon the date of
termination of this Agreement.
For the purpose of determining fees payable to you, the
value of the Fund's net assets shall be computed in the manner
specified in the Fund's charter documents for the computation of
the value of the Fund's net assets.
You will bear all expenses in connection with the
performance of your services under this Agreement. All other
expenses to be incurred in the operation of the Fund will be
borne by the Fund, except to the extent specifically assumed by
you. The expenses to be borne by the Fund include, without
limitation, the following: organizational costs, taxes,
interest, loan commitment fees, interest and distributions paid
on securities sold short, brokerage fees and commissions, if any,
fees of Board members who are not your officers, directors or
employees or holders of 5% or more of your outstanding voting
securities, Securities and Exchange Commission fees and state
Blue Sky qualification fees, advisory fees, charges of
custodians, transfer and dividend disbursing agents' fees,
certain insurance premiums, industry association fees, outside
auditing and legal expenses, costs of independent pricing
services, costs of maintaining the Fund's existence, costs
attributable to investor services (including, without limitation,
telephone and personnel expenses), costs of preparing and
printing prospectuses and statements of additional information
for regulatory purposes and for distribution to existing
stockholders, costs of stockholders' reports and meetings, and
any extraordinary expenses.
If in any fiscal year the aggregate expenses of the
Fund (including fees pursuant to this Agreement, but excluding
interest, taxes, brokerage and, with the prior written consent of
the necessary state securities commissions, extraordinary
expenses) exceed 1-1/2% of the average value of the Fund's net
assets for the fiscal year, the Fund may deduct from the fees to
be paid hereunder, or you will bear, such excess expense. Your
obligation pursuant hereto will be limited to the amount of your
fees hereunder. Such deduction or payment, if any, will be
estimated daily, and reconciled and effected or paid, as the case
may be, on a monthly basis.
The Fund understands that you now act, and that from
time to time hereafter you may act, as investment adviser to one
or more other investment companies and fiduciary or other managed
accounts, and the Fund has no objection to your so acting,
provided that when the purchase or sale of securities of the same
issuer is suitable for the investment objectives of two or more
companies or accounts managed by you which have available funds
for investment, the available securities will be allocated in a
manner believed by you to be equitable to each company or
account. It is recognized that in some cases this procedure may
adversely affect the price paid or received by the Fund or the
size of the position obtainable for or disposed of by the Fund.
In addition, it is understood that the persons employed
by you to assist in the performance of your duties hereunder will
not devote their full time to such service and nothing contained
herein shall be deemed to limit or restrict your right or the
right of any of your affiliates to engage in and devote time and
attention to other businesses or to render services of whatever
kind or nature.
You shall not be liable for any error of judgment or
mistake of law or for any loss suffered by the Fund in connection
with the matters to which this Agreement relates, except for a
loss resulting from willful misfeasance, bad faith or gross
negligence on your part in the performance of your duties or from
reckless disregard by you of your obligations and duties under
this Agreement. Any person, even though also your officer,
director, partner, employee or agent, who may be or become an
officer, Board member, employee or agent of the Fund, shall be
deemed, when rendering services to the Fund or acting on any
business of the Fund, to be rendering such services to or acting
solely for the Fund and not as your officer, director, partner,
employee or agent or one under your control or direction even
though paid by you.
This Agreement shall continue until May 20, 1995, and
thereafter shall continue automatically for successive annual
periods ending on May 20th of each year, provided such
continuance is specifically approved at least annually by (i) the
Fund's Board or (ii) vote of a majority (as defined in the
Investment Company Act of 1940) of the Fund's outstanding voting
securities, provided that in either event its continuance also is
approved by a majority of the Fund's Board members who are not
"interested persons" (as defined in said Act) of any party to
this Agreement, by vote cast in person at a meeting called for
the purpose of voting on such approval. This Agreement is
terminable without penalty, on 60 days' notice, by the Fund's
Board or by vote of holders of a majority of the Fund's shares
or, upon not less than 90 days' notice, by you. This Agreement
also will terminate automatically in the event of its assignment
(as defined in said Act).
The Fund recognizes that from time to time your
directors, officers and employees may serve as directors,
trustees, partners, officers and employees of other corporations,
business trusts, partnerships or other entities (including other
investment companies) and that such other entities may include
the name "Dreyfus" as part of their name, and that your
corporation or its affiliates may enter into investment advisory
or other agreements with such other entities. If you cease to
act as the Fund's investment adviser, the Fund agrees that, at
your request, the Fund will take all necessary action to change
the name of the Fund to a name not including "Dreyfus" in any
form or combination of words.
This Agreement has been executed on behalf of the Fund
by the undersigned officer of the Fund in his capacity as an
officer of the Fund. The obligations of this Agreement shall
only be binding upon the assets and property of the Fund and
shall not be binding upon any Board member, officer or
shareholder of the Fund individually.
If the foregoing is in accordance with your
understanding, will you kindly so indicate by signing and
returning to us the enclosed copy hereof.
Very truly yours,
DREYFUS NEW YORK TAX EXEMPT MONEY
MARKET FUND
By:___________________________
Accepted:
THE DREYFUS CORPORATION
By:_______________________________
DISTRIBUTION AGREEMENT
DREYFUS NEW YORK TAX EXEMPT MONEY MARKET FUND
144 Glenn Curtiss Boulevard
Uniondale, New York 11556-0144
August 24, 1994
Premier Mutual Fund Services, Inc.
One Exchange Place
Tenth Floor
Boston, Massachusetts 02109
Dear Sirs:
This is to confirm that, in consideration of the agree-
ments hereinafter contained, the above-named investment company
(the "Fund") has agreed that you shall be, for the period of
this agreement, the distributor of (a) shares of each Series of
the Fund set forth on Exhibit A hereto, as such Exhibit may be
revised from time to time (each, a "Series") or (b) if no Series
are set forth on such Exhibit, shares of the Fund. For purposes
of this agreement the term "Shares" shall mean the authorized
shares of the relevant Series, if any, and otherwise shall mean
the Fund's authorized shares.
1. Services as Distributor
1.1 You will act as agent for the distribution of
Shares covered by, and in accordance with, the registration
statement and prospectus then in effect under the Securities Act
of 1933, as amended, and will transmit promptly any orders
received by you for purchase or redemption of Shares to the
Transfer and Dividend Disbursing Agent for the Fund of which the
Fund has notified you in writing.
1.2 You agree to use your best efforts to solicit
orders for the sale of Shares. It is contemplated that you will
enter into sales or servicing agreements with securities
dealers, financial institutions and other industry
professionals, such as investment advisers, accountants and
estate planning firms, and in so doing you will act only on your
own behalf as principal.
1.3 You shall act as distributor of Shares in
compliance with all applicable laws, rules and regulations,
including, without limitation, all rules and regulations made or
adopted pursuant to the Investment Company Act of 1940, as
amended, by the Securities and Exchange Commission or any
securities association registered under the Securities Exchange
Act of 1934, as amended.
1.4 Whenever in their judgment such action is
warranted by market, economic or political conditions, or by
abnormal circumstances of any kind, the Fund's officers may
decline to accept any orders for, or make any sales of, any
Shares until such time as they deem it advisable to accept such
orders and to make such sales and the Fund shall advise you
promptly of such determination.
1.5 The Fund agrees to pay all costs and expenses in
connection with the registration of Shares under the Securities
Act of 1933, as amended, and all expenses in connection with
maintaining facilities for the issue and transfer of Shares and
for supplying information, prices and other data to be furnished
by the Fund hereunder, and all expenses in connection with the
preparation and printing of the Fund's prospectuses and
statements of additional information for regulatory purposes and
for distribution to shareholders; provided however, that nothing
contained herein shall be deemed to require the Fund to pay any
of the costs of advertising the sale of Shares.
1.6 The Fund agrees to execute any and all documents
and to furnish any and all information and otherwise to take all
actions which may be reasonably necessary in the discretion of
the Fund's officers in connection with the qualification of
Shares for sale in such states as you may designate to the Fund
and the Fund may approve, and the Fund agrees to pay all
expenses which may be incurred in connection with such
qualification. You shall pay all expenses connected with your
own qualification as a dealer under state or Federal laws and,
except as otherwise specifically provided in this agreement, all
other expenses incurred by you in connection with the sale of
Shares as contemplated in this agreement.
1.7 The Fund shall furnish you from time to time, for
use in connection with the sale of Shares, such information with
respect to the Fund or any relevant Series and the Shares as you
may reasonably request, all of which shall be signed by one or
more of the Fund's duly authorized officers; and the Fund
warrants that the statements contained in any such information,
when so signed by the Fund's officers, shall be true and
correct. The Fund also shall furnish you upon request with:
(a) semi-annual reports and annual audited reports of the Fund's
books and accounts made by independent public accountants
regularly retained by the Fund, (b) quarterly earnings
statements prepared by the Fund, (c) a monthly itemized list of
the securities in the Fund's or, if applicable, each Series'
portfolio, (d) monthly balance sheets as soon as practicable
after the end of each month, and (e) from time to time such
additional information regarding the Fund's financial condition
as you may reasonably request.
1.8 The Fund represents to you that all registration
statements and prospectuses filed by the Fund with the Securi-
ties and Exchange Commission under the Securities Act of 1933,
as amended, and under the Investment Company Act of 1940, as
amended, with respect to the Shares have been carefully prepared
in conformity with the requirements of said Acts and rules and
regulations of the Securities and Exchange Commission there-
under. As used in this agreement the terms "registration state-
ment" and "prospectus" shall mean any registration statement and
prospectus, including the statement of additional information
incorporated by reference therein, filed with the Securities and
Exchange Commission and any amendments and supplements thereto
which at any time shall have been filed with said Commission.
The Fund represents and warrants to you that any registration
statement and prospectus, when such registration statement
becomes effective, will contain all statements required to be
stated therein in conformity with said Acts and the rules and
regulations of said Commission; that all statements of fact
contained in any such registration statement and prospectus will
be true and correct when such registration statement becomes
effective; and that neither any registration statement nor any
prospectus when such registration statement becomes effective
will include an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary
to make the statements therein not misleading. The Fund may but
shall not be obligated to propose from time to time such amend-
ment or amendments to any registration statement and such
supplement or supplements to any prospectus as, in the light of
future developments, may, in the opinion of the Fund's counsel,
be necessary or advisable. If the Fund shall not propose such
amendment or amendments and/or supplement or supplements within
fifteen days after receipt by the Fund of a written request from
you to do so, you may, at your option, terminate this agreement
or decline to make offers of the Fund's securities until such
amendments are made. The Fund shall not file any amendment to
any registration statement or supplement to any prospectus
without giving you reasonable notice thereof in advance;
provided, however, that nothing contained in this agreement
shall in any way limit the Fund's right to file at any time such
amendments to any registration statement and/or supplements to
any prospectus, of whatever character, as the Fund may deem
advisable, such right being in all respects absolute and
unconditional.
1.9 The Fund authorizes you to use any prospectus in
the form furnished to you from time to time, in connection with
the sale of Shares. The Fund agrees to indemnify, defend and
hold you, your several officers and directors, and any person
who controls you within the meaning of Section 15 of the Securi-
ties Act of 1933, as amended, free and harmless from and against
any and all claims, demands, liabilities and expenses (including
the cost of investigating or defending such claims, demands or
liabilities and any counsel fees incurred in connection there-
with) which you, your officers and directors, or any such con-
trolling person, may incur under the Securities Act of 1933, as
amended, or under common law or otherwise, arising out of or
based upon any untrue statement, or alleged untrue statement, of
a material fact contained in any registration statement or any
prospectus or arising out of or based upon any omission, or
alleged omission, to state a material fact required to be stated
in either any registration statement or any prospectus or
necessary to make the statements in either thereof not
misleading; provided, however, that the Fund's agreement to
indemnify you, your officers or directors, and any such control-
ling person shall not be deemed to cover any claims, demands,
liabilities or expenses arising out of any untrue statement or
alleged untrue statement or omission or alleged omission made in
any registration statement or prospectus in reliance upon and in
conformity with written information furnished to the Fund by you
specifically for use in the preparation thereof. The Fund's
agreement to indemnify you, your officers and directors, and any
such controlling person, as aforesaid, is expressly conditioned
upon the Fund's being notified of any action brought against
you, your officers or directors, or any such controlling person,
such notification to be given by letter or by telegram addressed
to the Fund at its address set forth above within ten days after
the summons or other first legal process shall have been served.
The failure so to notify the Fund of any such action shall not
relieve the Fund from any liability which the Fund may have to
the person against whom such action is brought by reason of any
such untrue, or alleged untrue, statement or omission, or
alleged omission, otherwise than on account of the Fund's
indemnity agreement contained in this paragraph 1.9. The Fund
will be entitled to assume the defense of any suit brought to
enforce any such claim, demand or liability, but, in such case,
such defense shall be conducted by counsel of good standing
chosen by the Fund and approved by you. In the event the Fund
elects to assume the defense of any such suit and retain counsel
of good standing approved by you, the defendant or defendants in
such suit shall bear the fees and expenses of any additional
counsel retained by any of them; but in case the Fund does not
elect to assume the defense of any such suit, or in case you do
not approve of counsel chosen by the Fund, the Fund will
reimburse you, your officers and directors, or the controlling
person or persons named as defendant or defendants in such suit,
for the fees and expenses of any counsel retained by you or
them. The Fund's indemnification agreement contained in this
paragraph 1.9 and the Fund's representations and warranties in
this agreement shall remain operative and in full force and
effect regardless of any investigation made by or on behalf of
you, your officers and directors, or any controlling person, and
shall survive the delivery of any Shares. This agreement of
indemnity will inure exclusively to your benefit, to the benefit
of your several officers and directors, and their respective
estates, and to the benefit of any controlling persons and their
successors. The Fund agrees promptly to notify you of the
commencement of any litigation or proceedings against the Fund
or any of its officers or Board members in connection with the
issue and sale of Shares.
1.10 You agree to indemnify, defend and hold the Fund,
its several officers and Board members, and any person who con-
trols the Fund within the meaning of Section 15 of the Securi-
ties Act of 1933, as amended, free and harmless from and against
any and all claims, demands, liabilities and expenses (including
the cost of investigating or defending such claims, demands or
liabilities and any counsel fees incurred in connection there-
with) which the Fund, its officers or Board members, or any such
controlling person, may incur under the Securities Act of 1933,
as amended, or under common law or otherwise, but only to the
extent that such liability or expense incurred by the Fund, its
officers or Board members, or such controlling person resulting
from such claims or demands, shall arise out of or be based upon
any untrue, or alleged untrue, statement of a material fact
contained in information furnished in writing by you to the Fund
specifically for use in the Fund's registration statement and
used in the answers to any of the items of the registration
statement or in the corresponding statements made in the pro-
spectus, or shall arise out of or be based upon any omission, or
alleged omission, to state a material fact in connection with
such information furnished in writing by you to the Fund and
required to be stated in such answers or necessary to make such
information not misleading. Your agreement to indemnify the
Fund, its officers and Board members, and any such controlling
person, as aforesaid, is expressly conditioned upon your being
notified of any action brought against the Fund, its officers or
Board members, or any such controlling person, such notification
to be given by letter or telegram addressed to you at your
address set forth above within ten days after the summons or
other first legal process shall have been served. You shall
have the right to control the defense of such action, with
counsel of your own choosing, satisfactory to the Fund, if such
action is based solely upon such alleged misstatement or
omission on your part, and in any other event the Fund, its
officers or Board members, or such controlling person shall each
have the right to participate in the defense or preparation of
the defense of any such action. The failure so to notify you of
any such action shall not relieve you from any liability which
you may have to the Fund, its officers or Board members, or to
such controlling person by reason of any such untrue, or alleged
untrue, statement or omission, or alleged omission, otherwise
than on account of your indemnity agreement contained in this
paragraph 1.10. This agreement of indemnity will inure
exclusively to the Fund's benefit, to the benefit of the Fund's
officers and Board members, and their respective estates, and to
the benefit of any controlling persons and their successors.
You agree promptly to notify the Fund of the commencement of any
litigation or proceedings against you or any of your officers or
directors in connection with the issue and sale of Shares.
1.11 No Shares shall be offered by either you or the
Fund under any of the provisions of this agreement and no orders
for the purchase or sale of such Shares hereunder shall be
accepted by the Fund if and so long as the effectiveness of the
registration statement then in effect or any necessary amend-
ments thereto shall be suspended under any of the provisions of
the Securities Act of 1933, as amended, or if and so long as a
current prospectus as required by Section 10 of said Act, as
amended, is not on file with the Securities and Exchange
Commission; provided, however, that nothing contained in this
paragraph 1.11 shall in any way restrict or have an application
to or bearing upon the Fund's obligation to repurchase any
Shares from any shareholder in accordance with the provisions of
the Fund's prospectus or charter documents.
1.12 The Fund agrees to advise you immediately in
writing:
(a) of any request by the Securities and Exchange
Commission for amendments to the registration statement
or prospectus then in effect or for additional
information;
(b) in the event of the issuance by the Securities
and Exchange Commission of any stop order suspending
the effectiveness of the registration statement or pro-
spectus then in effect or the initiation of any
proceeding for that purpose;
(c) of the happening of any event which makes
untrue any statement of a material fact made in the
registration statement or prospectus then in effect or
which requires the making of a change in such registra-
tion statement or prospectus in order to make the
statements therein not misleading; and
(d) of all actions of the Securities and
Exchange Commission with respect to any amendments to
any registration statement or prospectus which may from
time to time be filed with the Securities and Exchange
Commission.
2. Offering Price
Shares of any class of the Fund offered for sale by you
shall be offered for sale at a price per share (the "offering
price") approximately equal to (a) their net asset value
(determined in the manner set forth in the Fund's charter
documents) plus (b) a sales charge, if any and except to those
persons set forth in the then-current prospectus, which shall be
the percentage of the offering price of such Shares as set forth
in the Fund's then-current prospectus. The offering price, if
not an exact multiple of one cent, shall be adjusted to the
nearest cent. In addition, Shares of any class of the Fund
offered for sale by you may be subject to a contingent deferred
sales charge as set forth in the Fund's then-current prospectus.
You shall be entitled to receive any sales charge or contingent
deferred sales charge in respect of the Shares. Any payments to
dealers shall be governed by a separate agreement between you
and such dealer and the Fund's then-current prospectus.
3. Term
This agreement shall continue until the date (the
"Reapproval Date") set forth on Exhibit A hereto (and, if the
Fund has Series, a separate Reapproval Date shall be specified
on Exhibit A for each Series), and thereafter shall continue
automatically for successive annual periods ending on the day
(the "Reapproval Day") of each year set forth on Exhibit A
hereto, provided such continuance is specifically approved at
least annually by (i) the Fund's Board or (ii) vote of a
majority (as defined in the Investment Company Act of 1940) of
the Shares of the Fund or the relevant Series, as the case may
be, provided that in either event its continuance also is
approved by a majority of the Board members who are not
"interested persons" (as defined in said Act) of any party to
this agreement, by vote cast in person at a meeting called for
the purpose of voting on such approval. This agreement is
terminable without penalty, on 60 days' notice, by vote of
holders of a majority of the Fund's or, as to any relevant
Series, such Series' outstanding voting securities or by the
Fund's Board as to the Fund or the relevant Series, as the case
may be. This agreement is terminable by you, upon 270 days'
notice, effective on or after the fifth anniversary of the date
hereof. This agreement also will terminate automatically, as to
the Fund or relevant Series, as the case may be, in the event of
its assignment (as defined in said Act).
4. Exclusivity
So long as you act as the distributor of Shares, you
shall not perform any services for any entity other than
investment companies advised or administered by The Dreyfus
Corporation. The Fund acknowledges that the persons employed by
you to assist in the performance of your duties under this
agreement may not devote their full time to such service and
nothing contained in this agreement shall be deemed to limit or
restrict your or any of your affiliates right to engage in and
devote time and attention to other businesses or to render
services of whatever kind or nature.
5. Miscellaneous
This agreement has been executed on behalf of the Fund
by the undersigned officer of the Fund in his capacity as an
officer of the Fund. The obligations of this agreement shall
only be binding upon the assets and property of the Fund and
shall not be binding upon any Board member, officer or
shareholder of the Fund individually.
Please confirm that the foregoing is in accordance with
your understanding and indicate your acceptance hereof by
signing below, whereupon it shall become a binding agreement
between us.
Very truly yours,
DREYFUS NEW YORK TAX EXEMPT
MONEY MARKET FUND
By:
Accepted:
PREMIER MUTUAL FUND SERVICES, INC.
By:________________________
EXHIBIT A
Reapproval Date Reapproval Day
May 20, 1996 May 20th
DREYFUS NEW YORK TAX EXEMPT BOND FUND, INC.
SHAREHOLDER SERVICES PLAN
Introduction: It has been proposed that the above-
captioned investment company (the "Fund") adopt a Shareholder
Services Plan (the "Plan") under which the Fund would reimburse
Dreyfus Service Corporation ("DSC") for certain allocated
expenses of providing personal services and/or maintaining
shareholder accounts to (a) shareholders of each series of the
Fund or class of Fund shares set forth on Exhibit A hereto, as
such Exhibit may be revised from time to time, or (b) if no
series or classes are set forth on such Exhibit, shareholders of
the Fund. The Plan is not to be adopted pursuant to Rule 12b-1
under the Investment Company Act of 1940, as amended (the "Act"),
and the fee under the Plan is intended to be a "service fee" as
defined in Article III, Section 26 (a "Service Fee"), of the NASD
Rules of Fair Practice (the "NASD Rules").
The Fund's Board, in considering whether the Fund
should implement a written plan, has requested and evaluated such
information as it deemed necessary to an informed determination
as to whether a written plan should be implemented and has
considered such pertinent factors as it deemed necessary to form
the basis for a decision to use Fund assets for such purposes.
In voting to approve the implementation of such a plan,
the Board has concluded, in the exercise of its reasonable
business judgment and in light of applicable fiduciary duties,
that there is a reasonable likelihood that the plan set forth
below will benefit the Fund and its shareholders.
The Plan: The material aspects of this Plan are as
follows:
1. The Fund shall reimburse DSC an amount not to
exceed an annual rate of .25 of 1% of the value of the Fund's
average daily net assets for its allocated expenses of providing
personal services to shareholders and/or maintaining shareholder
accounts; provided that, at no time, shall the amount paid to DSC
under this Plan, together with amounts otherwise paid by the
Fund, or each series or class identified on Exhibit A, as a
Service Fee under the NASD Rules, exceed the maximum amount then
payable under the NASD Rules as a Service Fee. The amount of
such reimbursement shall be based on an expense allocation
methodology prepared by DSC annually and approved by the Fund's
Board or on any other basis from time to time deemed reasonable
by the Fund's Board.
2. For the purposes of determining the fees payable
under this Plan, the value of the net assets of the Fund or the
net assets attributable to each series or class of Fund shares
identified on Exhibit A, shall be computed in the manner
specified in the Fund's charter documents for the computation of
the value of the Fund's net assets.
3. The Board shall be provided, at least quarterly,
with a written report of all amounts expended pursuant to this
Plan. The report shall state the purpose for which the amounts
were expended.
4. This Plan will become effective immediately upon
approval by a majority of the Board members, including a majority
of the Board members who are not "interested persons" (as defined
in the Act) of the Fund and have no direct or indirect financial
interest in the operation of this Plan or in any agreements
entered into in connection with this Plan, pursuant to a vote
cast in person at a meeting called for the purpose of voting on
the approval of this Plan.
5. This Plan shall continue for a period of one year
from its effective date, unless earlier terminated in accordance
with its terms, and thereafter shall continue automatically for
successive annual periods, provided such continuance is approved
at least annually in the manner provided in paragraph 4 hereof.
6. This Plan may be amended at any time by the Board,
provided that any material amendments of the terms of this Plan
shall become effective only upon approval as provided in
paragraph 4 hereof.
7. This Plan is terminable without penalty at any
time by vote of a majority of the Board members who are not
"interested persons" (as defined in the Act) of the Fund and have
no direct or indirect financial interest in the operation of this
Plan or in any agreements entered into in connection with this
Plan.
Dated: July 14, 1993
As Revised: October 19, 1994 EXHIBIT A
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the captions "Condensed
Financial Information" and "Custodian, Transfer and Dividend Disbursing
Agent, Counsel and Independent Auditors" and to the use of our report
dated July 7, 1995, in this Registration Statement (Form N-1A 33-14294)
of Dreyfus New York Tax Exempt Money Market Fund.
ERNST & YOUNG LLP
New York, New York
August 28, 1995
OTHER EXHIBIT
DREYFUS NEW YORK TAX EXEMPT MONEY MARKET FUND
Certificate of Assistant Secretary
The undersigned, Ruth D. Leibert, Assistant Secretary of Dreyfus New
York Tax Exempt Money Market Fund (the "Fund"), hereby certifies that set
forth below is a copy of the resolution adopted by the Fund's Board
authorizing the signing by Frederick C. Dey, Eric B. Fischman, Ruth D.
Leibert and John Pelletier on behalf of the proper officers of the Fund
pursuant to a power of attorney.
RESOLVED, that the Registration Statement and any and
all amendments and supplements thereto, may be signed by any one of
Frederick C. Dey, Eric B. Fischman, Ruth D. Leibert and John Pelletier as
the attorney-in-fact for the proper officers of the Funds, with full power
of substitution and resubstitution; and that the appointment of each of
such persons as such attorney-in-fact, and each of them, shall have full
power and authority to do and perform each and every act and thing
requisite and necessary to be done in connection with such Registration
Statement and any and all amendments and supplements thereto, as fully to
all intents and purposes as the officer, for whom he or she is acting as
attorney-in-fact, might or could do in person.
IN WITNESS WHEREOF, I have hereunto signed my name and affixed the
Seal of the Fund on November 7, 1994.
/s/ Ruth D. Leibert
Ruth D. Leibert
Assistant Secretary
POWER OF ATTORNEY
The undersigned, being members of the Board of the Dreyfus New York
Tax Exempt Money Market Fund hereby constitutes and appoints Frederick C.
Dey, Eric B. Fischman, Ruth D. Leibert and John Pelletier as the attorney-
in-fact for the proper officers of the Fund, with full power of
substitution and resubstitution; to sign any and all amendments to the
Registration Statement (including Post-Effective Amendments and amendments
thereto); and the appointment of each of such persons as such attorney-in-
fact hereby is authorized and approved; and that such attorneys-in-fact,
and each of them, shall have full power and authority to do and perform
each and every act and thing requisite and necessary to be done in
connection with such Registration Statement and any and all amendments and
supplements thereto, as fully to all intents and purposes as the officer,
for whom he is acting as attorney-in-fact, might or could do in person.
IN WITNESS WHEREOF, the undersigned have executed this Consent as of
August 29, 1994.
/s/ David W. Burke /s/ Arnold S. Hiatt
David W. Burke Arnold S. Hiatt
/s/ Samuel Chase /s/ David J. Mahoney
Samuel Chase David J. Mahoney
/s/ Joni Evans /s/ Burton N. Wallack
Joni Evans Burton N. Wallack
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<NAME> DREYFUS NEW YORK TAX EXEMPT MONEY MARKET FUND
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<PER-SHARE-NAV-BEGIN> 1.000
<PER-SHARE-NII> .027
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> .027
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> .007
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
