<PAGE> 1
DEAR SHAREHOLDER:
Like nearly all fixed-income securities, municipal bonds have enjoyed the
benefits of declining long-term interest rates in 1995.
Although the Federal Reserve Board did not reduce short-term interest rates
until July 6, long-term interest rates--which are driven by market forces--had
been falling for some time based on positive underlying market fundamentals. And
when interest rates fall, bonds generally appreciate in value. As a result,
most bond markets, including the municipal bond market, have had a strong year
thus far.
INVESTMENT BREAKDOWN:
THE NEW YORK TAX-EXEMPT INCOME
FUND, INC. AS OF 10/31/95(3)
64.4% AAA
12.1% AA
6.5% A
9.2% BBB
7.8% BB
During the past 12 months, your Fund's total return at net asset value was
12.12%. And the Fund continued to provide shareholders the benefit of tax-free
income, with a dividend return of 6.61% for the month ended October 31,
1995.(1) For New York State residents in certain tax brackets, this tax-free
yield would be equivalent to a taxable yield of 11.18%.(2)
One development that has sparked some concern among municipal investors,
however, is the discussion in Congress regarding possible changes to the income
tax system. There are several proposals to create a "flat" income tax, in which
the level of taxation would be changed to the same percentage for all taxpayers
in exchange for fewer tax deductions. Other proposals would exclude all
dividends and interest from taxation. If any of these proposals were to be
enacted, the relative advantage of municipal bonds over taxable bonds could
diminish or be eliminated. While we can't be certain where these proposals will
lead, we believe that the odds of significant tax reform that would adversely
affect municipal securities in the near future are quite low and that the more
likely scenario will be modifications to the existing tax structure.
<PAGE> 2
Currently, we believe municipal bonds are trading at very attractive levels
relative to taxable investments. Typically, we would expect long-term municipal
bonds to provide yields of about 80% of taxable bonds. Recently, however,
municipal bonds were trading at yields of more than 90% of taxable securities.
Couple that with inflation of only about 3%, and it becomes clear why we
believe municipal bonds have produced some of the best real, inflation-adjusted
returns in some time.
Although the economy has shown a variety of mixed signals recently, we believe
the Federal Reserve Board will not return to a tightening policy again in the
near future, because the U.S. economy appears to be in a moderate growth period
with subdued inflation. As a result, we do not expect the bond market to weaken
anytime soon and continue to be optimistic about municipal bonds.
Thank you for your confidence in OppenheimerFunds, and we look forward to
helping you to reach your investment goals in the future.
Sincerely,
/s/ JAMES C. SWAIN
- ------------------
James C. Swain
Chairman
The New York Tax-Exempt
Income Fund, Inc.
/s/ JON S. FOSSEL
- -----------------
Jon S. Fossel
President
The New York Tax-Exempt
Income Fund, Inc.
November 21, 1995
1. Total return is based on the change in net asset value per share from
10/31/94 to 10/31/95, without deducting any brokerage costs. Dividend yield
is determined by annualizing the October 1995 dividend of $0.053 and
dividing by the closing price on the American Stock Exchange of $9.625 per
share on 10/2/95 (payment date). Past performance does not guarantee future
results.
2. Assumes a combined effective tax bracket of 40.86% for New York State
residents, using the 36% federal and the maximum New York state income
tax rates, applied to the switch between taxable and nontaxable investments.
A portion of the Fund's distributions may be subject to income taxes. For
investors subject to alternative minimum income tax, a portion of the Fund's
distributions may increase that tax.
3. Credit allocations and portfolio composition are subject to change. Chart is
based on total investments at market value rather than net assets.
<PAGE> 3
STATEMENT OF INVESTMENTS October 31, 1995
The New York Tax-Exempt Income Fund, Inc.
<TABLE>
<CAPTION>
Ratings: Market
Moody's/S&P's/Fitch's Face Value
(Unaudited) Amount See Note 1
--------------- ---------- -----------
<S> <C> <C> <C>
MUNICIPAL BONDS AND NOTES -- 94.6%
NEW YORK -- 88.1%
Babylon, New York Industrial Development Agency
Resource Recovery Revenue Bonds, Ogden Martin
Systems, Inc., Series C, 8.50%, 1/1/19........... Aaa/BBB+ $ 985,000 $ 1,120,396
City of New York General Obligation Bonds,
Prerefunded, Series A, 8.75%, 11/1/15............ Aaa/AAA 1,000,000 1,105,721
City of New York General Obligation Bonds, Series
D, 7.50%, 2/1/19................................. Baa1/BBB+ 1,300,000 1,428,673
City of New York Health & Hospital Corp. Revenue
Refunding Bonds, Series A, AMBAC Insured, Inverse
Floater, 7.19%, 2/15/23 (1)...................... Aaa/AAA/AAA 1,000,000 916,771
City of New York Municipal Water Finance Authority
Water & Sewer System Revenue Bonds, Prerefunded,
Series A, 9%, 6/15/17............................ Aaa/AAA 500,000 548,813
Dormitory Authority of the State of New York
Revenue Bonds, Judicial Facilities Lease,
Escrowed to Maturity, BIG Insured, 7.375%,
7/1/16........................................... Aaa/AAA 250,000 291,873
Dormitory Authority of the State of New York
Revenue Refunding Bonds, Long Island Jewish
Medical Center, Series A, FHA Insured,
7.75%, 8/15/27................................... Aa/AAA 1,000,000 1,080,153
Metropolitan Transportation Authority of New York
Revenue Bonds, Transportation Facilities Service
Contracts, Prerefunded, Series 1, 8.50%,
7/1/17........................................... Aaa/AAA 500,000 545,843
Municipal Assistance Corp. for the City of New York
Revenue Bonds, Series 61, MBIA Insured,
6.875%, 7/1/07................................... Aaa/AAA 500,000 532,071
Municipal Assistance Corp. for the City of New York
Revenue Bonds, Series 62, 6.90%, 7/1/07.......... Aa/AA-/AA 500,000 529,053
New York State Energy Research & Development
Authority Electric Facilities Revenue Bonds, Long
Island Lighting Co., Series C, 6.90%, 8/1/22..... Ba1/BB+ 1,300,000 1,313,931
New York State Energy Research & Development
Authority Gas Facilities Revenue Bonds, Brooklyn
Union Gas Co. Project, Series D, MBIA Insured,
Inverse Floater, 7.133%, 7/8/26 (1).............. Aaa/AAA/A 1,000,000 898,584
</TABLE>
3
<PAGE> 4
STATEMENT OF INVESTMENTS October 31, 1995 (Continued)
The New York Tax-Exempt Income Fund, Inc.
<TABLE>
<CAPTION>
Ratings: Market
Moody's/S&P's/Fitch's Face Value
(Unaudited) Amount See Note 1
--------------- ---------- -----------
<S> <C> <C> <C>
MUNICIPAL BONDS AND NOTES (CONTINUED)
NEW YORK (CONTINUED)
New York State Energy Research & Development
Authority Pollution Control Revenue Bonds,
Rochester Gas & Electric Co. Project, Series C,
8.375%, 12/1/28.................................. Baa1/BBB+ $ 250,000 $ 276,862
New York State General Obligation Refunding Bonds,
9.875%, 11/15/05................................. A/A-/A+ 400,000 554,206
New York State Housing Finance Agency Revenue
Bonds, State University Construction Project,
Prerefunded, Series A, 8.30%, 5/1/18............. Aaa/AAA 750,000 826,329
New York State Housing Finance Agency Service
Contract Obligation Revenue Bonds, Prerefunded,
Series A, 7.375%, 9/15/21........................ Aaa/AAA 575,000 673,114
New York State Local Assistance Corp. Revenue
Bonds, Prerefunded, Series B, 7.375%, 4/1/12..... Aaa/AAA 140,000 161,831
New York State Medical Care Facilities Finance
Agency Revenue Bonds, Bronx-Lebanon Hospital,
Series A, BIG Insured, 7.10%, 2/15/27............ Aaa/AAA 1,000,000 1,045,843
New York State Medical Care Facilities Finance
Agency Revenue Bonds, Mental Health Services
Facilities Improvement Project, Prerefunded,
Series A, 8.875%, 8/15/07........................ Aaa/AAA 155,000 170,978
New York State Medical Care Facilities Finance
Agency Revenue Bonds, Mental Health Services
Facilities Improvement Project, Series A,
8.875%, 8/15/07.................................. Baa1/BBB+ 345,000 374,594
New York State Medical Care Facilities Finance
Agency Revenue Bonds, Richland Memorial Hospital
& Nursing Home Mtg., Series B, FHA Insured,
9.125%, 2/15/25.................................. Aa/AA 210,000 212,883
New York State Mtg. Agency Revenue Bonds, Inverse
Floater, 5.687%, 10/1/24 (1)..................... Aa/NR 1,000,000 767,535
New York State Mtg. Agency Revenue Bonds, Ninth
Series E, 8.375%, 4/1/18......................... Aa/NR 655,000 679,331
New York State Power Authority Revenue Bonds,
Prerefunded, Series V, 8%, 1/1/17................ NR/AA 500,000 549,809
New York State Power Authority Revenue Refunding
Bonds, Series V, MBIA Insured, 7.875%, 1/1/13.... Aaa/AAA 450,000 493,232
</TABLE>
4
<PAGE> 5
STATEMENT OF INVESTMENTS October 31, 1995 (Continued)
The New York Tax-Exempt Income Fund, Inc.
<TABLE>
<CAPTION>
Ratings: Market
Moody's/S&P's/Fitch's Face Value
(Unaudited) Amount See Note 1
--------------- ---------- -----------
<S> <C> <C> <C>
MUNICIPAL BONDS AND NOTES (CONTINUED)
NEW YORK (CONTINUED)
New York State Urban Development Corp. Revenue
Refunding Bonds, Correctional Facilities Capital
Project, Prerefunded, 8%, 1/1/06................. Aaa/NR $1,000,000 $ 1,026,697
Onondaga County, New York Resources Recovery Agency
Revenue Bonds, Resources Recovery Facilities
Project, 7%, 5/1/15.............................. Baa/NR/A- 900,000 921,376
Suffolk County, New York General Obligation Bonds,
Prerefunded, FGIC Insured, 7.10%, 7/15/10........ Aaa/AAA/AAA 510,000 545,922
Suffolk County, New York General Obligation
Refunding Bonds, AMBAC Insured, 10%, 11/1/02..... Aaa/AAA/AAA 250,000 326,346
Triborough Bridge & Tunnel Authority of New York
General Purpose Revenue Bonds, Prerefunded,
Series K, 8.25%, 1/1/17.......................... Aaa/AAA 1,040,000 1,110,531
-----------
21,029,301
U.S. POSSESSIONS -- 6.5%
Puerto Rico Electric Power Authority Revenue
Refunding Bonds, Prerefunded, Series K,
9.375%, 7/1/17................................... Aaa/AAA 1,000,000 1,106,442
Puerto Rico Industrial, Medical & Environmental
Pollution Control Revenue Bonds, American
Airlines, Inc. Project, Series A, 8.75%,
12/1/25.......................................... Baa1/BB+ 435,000 445,059
-----------
1,551,501
-----------
Total Investments, at Value (Cost $21,377,218).......................... 94.6% 22,580,802
Other Assets Net of Liabilities......................................... 5.4 1,298,475
========== ===========
Net Assets.............................................................. 100.0% $23,879,277
========== ===========
</TABLE>
(1) Represents the current interest rate for a variable rate bond. Variable rate
bonds known as "inverse floaters" pay interest at a rate that varies
inversely with short-term interest rates. As interest rates rise, inverse
floaters produce less current income. Their price may be more volatile than
the price of a comparable fixed-rate security. Inverse floaters amount to
$2,582,890 or 10.8% of the Fund's net assets at October 31, 1995.
As of October 31, 1995, securities subject to the alternative minimum tax
amounted to $3,191,500 or 13.4% of the Fund's net assets.
See accompanying Notes to Financial Statements.
5
<PAGE> 6
STATEMENT OF INVESTMENTS October 31, 1995 (Continued)
The New York Tax-Exempt Income Fund, Inc.
Distribution of investments by industry, as a percentage of total
investments at value, is as follows:
<TABLE>
<CAPTION>
Market
Industry Value Percent
-------------------------------------------------------------- ----------- -----
<S> <C> <C>
Utilities..................................................... $ 4,740,068 21.0%
General Obligation Bonds...................................... 3,960,868 17.5
Housing....................................................... 3,146,677 14.0
Hospitals..................................................... 2,721,069 12.1
Pollution Control............................................. 2,489,377 11.0
Transportation................................................ 1,656,374 7.3
Lease/Rental.................................................. 1,372,026 6.1
Special Tax Bonds............................................. 1,061,124 4.7
Education..................................................... 826,329 3.6
Industrial Development........................................ 445,059 2.0
Revenue Bonds................................................. 161,831 0.7
----------- -----
$22,580,802 100.0%
=========== =====
</TABLE>
See accompanying Notes to Financial Statements.
6
<PAGE> 7
STATEMENT OF ASSETS AND LIABILITIES October 31, 1995
The New York Tax-Exempt Income Fund, Inc.
<TABLE>
<S> <C>
ASSETS:
Investments, at value (cost $21,377,218) -- see accompanying statement.................. $22,580,802
Cash.................................................................................... 3,317
Receivables:
Investments sold...................................................................... 961,068
Interest.............................................................................. 491,825
Other................................................................................... 8,979
-----------
Total assets........................................................................ 24,045,991
-----------
LIABILITIES:
Payables and other liabilities:
Dividends............................................................................. 129,255
Shareholder reports................................................................... 17,299
Transfer agent and accounting services fees -- Note 4................................. 5,669
Directors' fees....................................................................... 52
Other................................................................................. 14,439
-----------
Total liabilities................................................................... 166,714
-----------
NET ASSETS.............................................................................. $23,879,277
===========
COMPOSITION OF NET ASSETS:
Par value of shares of capital stock.................................................... 24,388
Additional paid-in capital.............................................................. 22,604,843
Undistributed net investment income..................................................... 53,705
Accumulated net realized loss from investment transactions.............................. (7,243)
Net unrealized appreciation on investments -- Note 3.................................... 1,203,584
-----------
NET ASSETS -- Applicable to 2,438,782 shares of capital stock outstanding............... $23,879,277
===========
NET ASSET VALUE PER SHARE............................................................... $ 9.79
====
</TABLE>
See accompanying Notes to Financial Statements.
7
<PAGE> 8
STATEMENT OF OPERATIONS For the Year Ended October 31, 1995
The New York Tax-Exempt Income Fund, Inc.
<TABLE>
<S> <C>
INVESTMENT INCOME -- Interest............................................................ $1,731,586
----------
EXPENSES:
Management fees -- Note 4................................................................ 115,784
Shareholder reports...................................................................... 29,417
Transfer agent and accounting service fees -- Note 4..................................... 26,135
Legal and auditing fees.................................................................. 7,565
Directors' fees and expenses............................................................. 4,545
Insurance expenses....................................................................... 2,624
Registration and filing fees............................................................. 7,204
Other.................................................................................... 9,460
----------
Total expenses....................................................................... 202,734
Less expenses paid indirectly............................................................ (2,800)
----------
Total net expenses................................................................... 199,934
----------
NET INVESTMENT INCOME.................................................................... 1,531,652
----------
REALIZED AND UNREALIZED GAIN (LOSS):
Net realized loss on investments......................................................... (2,641)
Net change in unrealized appreciation or depreciation on investments..................... 1,126,994
----------
NET REALIZED AND UNREALIZED GAIN......................................................... 1,124,353
----------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS..................................... $2,656,005
==========
</TABLE>
See accompanying Notes to Financial Statements.
8
<PAGE> 9
STATEMENTS OF CHANGES IN NET ASSETS
The New York Tax-Exempt Income Fund, Inc.
<TABLE>
<CAPTION>
Year Ended October 31,
--------------------------
1995 1994
----------- -----------
<S> <C> <C>
OPERATIONS:
Net investment income...................................................... $ 1,531,652 $ 1,558,615
Net realized loss.......................................................... (2,641) (2,690)
Net change in unrealized appreciation or depreciation...................... 1,126,994 (2,847,845)
----------- -----------
Net increase (decrease) in net assets resulting from operations.......... 2,656,005 (1,291,920)
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS:
Dividends from net investment income....................................... (1,541,374) (1,569,169)
Distributions in excess of net realized gain............................... -- (598,198)
CAPITAL STOCK TRANSACTIONS:
Proceeds from shares issued to shareholders in reinvestment of dividends
and distributions -- Note 2.............................................. 296,884 410,642
----------- -----------
Total increase (decrease).............................................. 1,411,515 (3,048,645)
NET ASSETS:
Beginning of period........................................................ 22,467,762 25,516,407
----------- -----------
End of period (including undistributed net investment income of $53,705 and
$67,276, respectively)................................................... $23,879,277 $22,467,762
=========== ===========
</TABLE>
See accompanying Notes to Financial Statements.
9
<PAGE> 10
FINANCIAL HIGHLIGHTS
The New York Tax-Exempt Income Fund, Inc.
<TABLE>
<CAPTION>
Eleven
Months
Year Ended October 31, Ended
------------------------------------------------------- October 31,
1995 1994 1993 1992 1991 1990(2)
------- ------- ------- ------- ------- -----------
<S> <C> <C> <C> <C> <C> <C>
PER SHARE OPERATING DATA:
Net asset value, beginning of period........... $ 9.33 $ 10.77 $ 10.37 $ 10.22 $ 9.78 $ 10.00
------- ------- ------- ------- ------- ---------
Income (loss) from investment operations:
Net investment income before cumulative effect
of a change in accounting principle......... .63 .65 .66 .65 .64 .57
Cumulative effect of a change in the method of
accounting for registration and initial
public offering costs....................... -- -- -- -- -- --
Net realized and unrealized gain (loss) on
investments................................. .47 (1.18) .55 .18 .47 (.12)
------- ------- ------- ------- ------- ---------
Total income (loss) from investment
operations................................. 1.10 (.53) 1.21 .83 1.11 .45
------- ------- ------- ------- ------- ---------
Dividends and distributions to shareholders:
Dividends from net investment income.......... (.64) (.66) (.74) (.64) (.64) (.56)
Distributions from net realized gain on
investments................................. -- -- (.07) (.04) (.03) (.11)
Distributions in excess of net realized gain
on investments.............................. -- (.25) -- -- -- --
------- ------- ------- ------- ------- ---------
Total dividends and distributions to
shareholders............................... (.64) (.91) (.81) (.68) (.67) (.67)
Registration and initial public offering
costs......................................... -- -- -- -- -- --
------- ------- ------- ------- ------- ---------
Net asset value, end of period................. $ 9.79 $ 9.33 $ 10.77 $ 10.37 $ 10.22 $ 9.78
======= ======= ======= ======= ======= =========
Market value, end of period.................... $ 9.63 $ 9.50 $ 12.63 $ 10.88 $ 10.00 $ 9.13
TOTAL RETURN, AT MARKET VALUE(3)............... 8.32% (17.70)% 25.11% 16.09% 17.19% 5.55%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands)....... $23,879 $22,468 $25,516 $24,266 $23,713 $22,705
Average net assets (in thousands).............. $23,143 $23,852 $24,936 $24,042 $23,101 $22,847
Number of shares outstanding at end of period
(in thousands)................................ 2,439 2,408 2,369 2,340 2,321 2,321
Ratios to average net assets:
Net investment income......................... 6.62% 6.53% 6.26% 6.32% 6.43% 6.33%(4)
Expenses(5)................................... .88% .87% .84% .97% .97% 1.12%(4)
Portfolio turnover rate(6)..................... 12% 6% 28% 9% 2% 4%
<CAPTION>
Period
Year Ended November 30, Ended
November
--------------------------- 30,
1989 1988 1987(1)
----------- ----------- -----------
<S> <C> <C> <C>
PER SHARE OPERATING DATA:
Net asset value, beginning of period........... $ 9.92 $ 9.51 $ 9.35
----------- ----------- ---------
Income (loss) from investment operations:
Net investment income before cumulative effect
of a change in accounting principle......... .62 .61 .04
Cumulative effect of a change in the method of
accounting for registration and initial
public offering costs....................... .03 -- --
Net realized and unrealized gain (loss) on
investments................................. .24 .47 .12
----------- ----------- ---------
Total income (loss) from investment
operations................................. .89 1.08 .16
----------- ----------- ---------
Dividends and distributions to shareholders:
Dividends from net investment income.......... (.63) (.59) --
Distributions from net realized gain on
investments................................. (.06) (.08) --
Distributions in excess of net realized gain
on investments.............................. -- -- --
----------- ----------- ---------
Total dividends and distributions to
shareholders............................... (.69) (.67) --
Registration and initial public offering
costs......................................... (.12) -- --
----------- ----------- ---------
Net asset value, end of period................. $ 10.00 $ 9.92 $ 9.51
=========== =========== =========
Market value, end of period.................... $ 9.25 $ 9.38 $ 10.25
TOTAL RETURN, AT MARKET VALUE(3)............... 5.70% (2.06)% .25%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands)....... $ 23,203 $ 23,004 $21,973
Average net assets (in thousands).............. $ 23,108 $ 22,132 $15,294
Number of shares outstanding at end of period
(in thousands)................................ 2,321 2,318 2,311
Ratios to average net assets:
Net investment income......................... 6.57% 6.27% 4.02%(4)
Expenses(5)................................... 1.34% 1.53% 1.46%(4)
Portfolio turnover rate(6)..................... 24% 45% 35%
</TABLE>
(1) For the period from October 15, 1987 (commencement of operations) to
November 30, 1987.
(2) On April 7, 1990, Oppenheimer Management Corporation became the investment
advisor to the Fund.
(3) Assumes a hypothetical purchase at the current market price on the business
day before the first day of the fiscal period, with all dividends and
distributions reinvested in additional shares on the reinvestment date, and
a sale at the current market price on the last business day of the period.
(4) Annualized.
(5) Beginning in fiscal 1995, the expense ratio reflects the effect of gross
expenses paid indirectly by the Fund. Prior year expense ratios have not
been adjusted.
(6) The lesser of purchases or sales of portfolio securities for a period,
divided by the monthly average of the market value of portfolio securities
owned during the period. Securities with a maturity or expiration date at
the time of acquisition of one year or less are excluded from the
calculation. Purchases and sales of investment securities (excluding
short-term securities) for the period ended October 31, 1995 were $2,714,414
and $3,365,328, respectively.
See accompanying Notes to Financial Statements.
10
<PAGE> 11
NOTES TO FINANCIAL STATEMENTS
The New York Tax-Exempt Income Fund, Inc.
1. SIGNIFICANT ACCOUNTING POLICIES
The New York Tax-Exempt Income Fund, Inc. (the Fund) is registered under
the Investment Company Act of 1940, as amended, as a diversified,
closed-end management investment company. The Fund's investment advisor is
Oppenheimer Management Corporation (the Manager). The following is a
summary of significant accounting policies consistently followed by the
Fund.
Investment Valuation -- Portfolio securities are valued at the close of the
American Stock Exchange on the last day of each week on which day the
American Stock Exchange is open. Listed and unlisted securities for which
such information is regularly reported are valued at the last sale price of
the day or, in the absence of sales, at values based on the closing bid or
asked price or the last sale price on the prior trading day. Long-term and
short-term "non-money market" debt securities are valued by a portfolio
pricing service approved by the Board of Directors. Such securities which
cannot be valued by the approved portfolio pricing service are valued using
dealer-supplied valuations provided the Manager is satisfied that the firm
rendering the quotes is reliable and that the quotes reflect current market
value, or are valued under consistently applied procedures established by
the Board of Directors to determine fair value in good faith. Short-term
"money market type" debt securities having a remaining maturity of 60 days
or less are valued at cost (or last determined market value) adjusted for
amortization to maturity of any premium or discount.
Federal Taxes -- The Fund intends to continue to comply with provisions of
the Internal Revenue Code applicable to regulated investment companies and
to distribute all of its taxable income, including any net realized gain on
investments not offset by loss carryovers, to shareholders. Therefore, no
federal income or excise tax provision is required. At October 31, 1995,
the Fund had available for federal income tax purposes an unused capital
loss carryover of approximately $886, which will expire in 2002.
Distributions to Shareholders -- The Fund intends to declare and pay
dividends from net investment income monthly. Distributions from net
realized gains on investments, if any, will be declared at least once each
year.
Classification of Distributions to Shareholders -- Net investment income
(loss) and net realized gain (loss) may differ for financial statement and
tax purposes primarily because of premium amortization. The character of
the distributions made during the year from net investment income or net
realized gains may differ from their ultimate characterization for federal
income tax purposes. Also, due to timing of dividend distributions, the
fiscal year in which amounts are distributed may differ from the year that
the income or realized gain (loss) was recorded by the Fund.
During the year ended October 31, 1995, the Fund changed the classification
of distributions to shareholders to better disclose the differences between
financial statement amounts and distributions determined in accordance with
income tax regulations. Accordingly, during the year ended October 31,
1995, amounts have been reclassified to reflect a decrease in undistributed
net investment income of $3,849. Accumulated net realized loss from
investment transactions was decreased by the same amount.
Other -- Investment transactions are accounted for on the date the
investments are purchased or sold (trade date). Discount on securities
purchased is amortized over the life of the respective securities, in
accordance with federal income tax requirements. For bonds acquired after
April 30, 1993, accrued market discount is recognized at maturity or
disposition as taxable ordinary income. Taxable ordinary income is realized
to the extent of the lesser of gain or accrued market discount. Realized
gains and
11
<PAGE> 12
NOTES TO FINANCIAL STATEMENTS (Continued)
The New York Tax-Exempt Income Fund, Inc.
losses on investments and unrealized appreciation and depreciation are
determined on an identified cost basis, which is the same basis used for
federal income tax purposes.
The Fund concentrates its investments in New York and, therefore, may have
more credit risks related to the economic conditions of New York than a
portfolio with a broader geographical diversification.
2. CAPITAL STOCK
The Fund has authorized 250,250,000 shares of $.01 par value capital stock.
Of these shares, 236,218 shares were reserved for issuance under a Dividend
Reinvestment and Cash Purchase Plan. Transactions in shares of capital
stock were as follows:
<TABLE>
<CAPTION>
Year Ended October 31,
---------------------------------------
1995 1994
----------------- -----------------
Shares Amount Shares Amount
------ -------- ------ --------
<S> <C> <C> <C> <C>
Net increase
from dividends
and distributions
reinvested.......... 30,958 $296,884 38,818 $410,642
</TABLE>
3. UNREALIZED GAINS AND LOSSES ON INVESTMENTS
At October 31, 1995, net unrealized appreciation on investments of
$1,203,584 was composed of gross appreciation of $1,623,101, and gross
depreciation of $419,517.
4. MANAGEMENT FEES AND OTHER TRANSACTIONS WITH AFFILIATES
Management fees paid to the Manager were in accordance with the investment
advisory agreement with the Fund which provides for a fee of .50% on the
Fund's average annual net assets.
The Manager acts as the accounting agent for the Fund at an annual fee of
$12,000, plus out-of-pocket costs and expenses reasonably incurred.
Shareholder Financial Services, Inc. (SFSI), a wholly-owned subsidiary of
the Manager, is the transfer agent and registrar for the Fund. Fees paid to
SFSI are based on the number of accounts and the number of shareholder
transactions, plus out-of-pocket costs and expenses.
Expenses paid indirectly represent a reduction of custodian fees for
earnings on cash balances maintained by the Fund.
12
<PAGE> 13
NOTES TO FINANCIAL STATEMENTS (Continued)
The New York Tax-Exempt Income Fund, Inc.
5. QUARTERLY RESULTS OF OPERATIONS: (UNAUDITED)
<TABLE>
<CAPTION>
Net Increase
Net Realized and (Decrease) in
Net Unrealized Gain Net Assets
Investment (Loss) on Resulting from
Income Investments Operations Market Price
--------------- ----------------- ---------------- on ASE
Total Per Total Per Total Per ------------------
Quarter ended (000) Share (000) Share (000) Share High Low
----------------------------- ------ ----- ------- ------ ------- ----- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
October 31, 1995............. $ 384 $.16 $ 251 $ .10 $ 635 $ .26 $ 10.25 $ 9.50
July 31, 1995................ 379 .15 98 .05 477 .20 10.38 9.63
April 30, 1995............... 377 .16 774 .32 1,151 .48 10.00 9.25
January 31, 1995............. 392 .16 1 .00 393 .16 9.50 8.875
------ ---- ------- ------ ------- -----
Totals................... $1,532 $.63 $ 1,124 $ .47 $ 2,656 $1.10
====== ==== ======= ====== ======= =====
October 31, 1994............. $ 400 $.17 $ (951) $ (.39) $ (551) $(.22) 10.00 9.25
July 31, 1994................ 402 .17 (12) .00 390 .17 10.25 9.50
April 30, 1994............... 375 .15 (1,836) (.77) (1,461) (.62) 11.75 9.875
January 31, 1994............. 382 .16 (52) (.02) 330 .14 12.625 11.25
------ ---- ------- ------ ------- -----
Totals................... $1,559 $.65 $(2,851) $(1.18) $(1,292) $(.53)
====== ==== ======= ====== ======= =====
October 31, 1993............. $ 377 $.16 $ 344 $ .15 $ 721 $ .31 12.875 12.00
July 31, 1993................ 399 .17 64 .03 463 .20 12.50 11.375
April 30, 1993............... 383 .16 370 .16 753 .32 12.25 11.00
January 31, 1993............. 397 .17 2,481 .21 2,878 .38 11.50 10.125
------ ---- ------- ------ ------- -----
Totals................... $1,556 $.66 $ 3,259 $ .55 $ 4,815 $1.21
====== ==== ======= ====== ======= =====
</TABLE>
13
<PAGE> 14
INDEPENDENT AUDITORS' REPORT
The New York Tax-Exempt Income Fund, Inc.
The Board of Directors and Shareholders of
The New York Tax-Exempt Income Fund, Inc.:
We have audited the accompanying statement of assets and liabilities, including
the statement of investments, of The New York Tax-Exempt Income Fund, Inc. as of
October 31, 1995, the related statement of operations for the year then ended,
the statements of changes in net assets for the years ended October 31, 1995 and
1994 and the financial highlights for the period December 1, 1989 to October 31,
1995. 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. The financial
highlights (except for total return) for the period October 15, 1987
(commencement of operations) to November 30, 1989 were audited by other auditors
whose report dated January 4, 1990, expressed an unqualified opinion on those
financial highlights.
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 at October
31, 1995 by correspondence with the custodian and brokers; where confirmations
were not received from brokers, we performed other auditing procedures. 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, such financial statements and financial highlights present
fairly, in all material respects, the financial position of The New York
Tax-Exempt Income Fund, Inc. at October 31, 1995, the results of its operations,
the changes in its net assets, and the financial highlights for the respective
stated periods, in conformity with generally accepted accounting principles.
DELOITTE & TOUCHE LLP
Denver, Colorado
November 21, 1995
14
<PAGE> 15
FEDERAL INCOME TAX INFORMATION (Unaudited)
The New York Tax-Exempt Income Fund, Inc.
In early 1996, shareholders will receive information regarding all dividends and
distributions paid to them by the Fund during calendar year 1995. Regulations of
the U.S. Treasury Department require the Fund to report this information to the
Internal Revenue Service.
None of the dividends paid by the Fund during the fiscal year ended October 31,
1995 are eligible for the corporate dividend-received deduction. The dividends
were derived from interest on municipal bonds and are not subject to federal
income tax. To the extent a shareholder is subject to any state or local tax
laws, some or all of the dividends received may be taxable.
The foregoing information is presented to assist shareholders in reporting
distributions received from the Fund to the Internal Revenue Service. Because of
the complexity of the federal regulations which may affect your individual tax
return and the many variations in state and local tax regulations, we recommend
that you consult your tax advisor for specific guidance.
SHAREHOLDER MEETING (Unaudited)
On May 3, 1995, an annual shareholder meeting was held at which the three
Directors identified below were elected and the selection of Deloitte & Touche
LLP as the independent certified public accountants and auditors of the Fund for
the fiscal year beginning November 1, 1994 was ratified (Proposal No. 1). In
addition, the terms of office of the following Directors continued after the
meeting: Messrs. Robert G. Avis, William A. Baker, Charles Conrad, Jr., Jon S.
Fossel, Raymond J. Kalinowski and James C. Swain. The following is a report of
the votes cast:
<TABLE>
<CAPTION>
Nominee For Against Abstained Total
- ------------------------------------------------- ------------- ---------- ---------- -------------
<S> <C> <C> <C> <C>
DIRECTORS
C. Howard Kast................................... 1,583,320.875 45,071.215 11,592.000 1,639,984.090
Robert M. Kirchner............................... 1,583,320.875 45,071.215 11,592.000 1,639,984.090
Ned M. Steel..................................... 1,583,320.875 45,071.215 11,592.000 1,639,984.090
</TABLE>
<TABLE>
<CAPTION>
Proposal For Against Abstained Total
- ------------------------------------------------- ------------- ---------- ---------- -------------
<S> <C> <C> <C> <C>
Proposal No. 1................................... 1,587,945.097 7,761.220 44,277.773 1,639,984.090
</TABLE>
15
<PAGE> 16
SUMMARY OF GENERAL INFORMATION
GENERAL INFORMATION CONCERNING THE FUND
The New York Tax-Exempt Income Fund, Inc. (the Fund) is a closed-end
investment company whose shares trade on the American Stock Exchange (the
ASE). The Fund seeks to provide high current income which is free from
federal, New York State and New York City income taxes. A portion of the
Fund's distributions may be subject to income tax. For investors subject to
the alternative minimum income tax, a portion of the Fund's distributions
may increase that tax. The Fund seeks to achieve its objective by investing
in municipal obligations, the income from which is tax-exempt as described
above. The Fund may invest in municipal lease obligations, municipal
obligations with variable or floating interest rates and certain derivative
investments, such as inverse floaters. The Fund may also use certain
hedging instruments. The investment advisor (the Manager) of the Fund is
Oppenheimer Management Corporation.
The Portfolio Manager of the Fund is Robert E. Patterson, who also serves
as Vice President of the Fund and Senior Vice President of the Manager. Mr.
Patterson has been the person principally responsible for the day-to-day
management of the Fund's portfolio since February 1992. During the past six
years, Mr. Patterson has also served as an officer and portfolio manager
for certain mutual funds managed by the Manager (Oppenheimer funds).
DIVIDEND REINVESTMENT AND CASH PURCHASE PLAN
Pursuant to the Fund's Dividend Reinvestment and Cash Purchase Plan (the
Plan), as to shares of the Fund (Shares) not registered in nominee name,
all dividends and capital gains distributions (Distributions) declared by
the Fund will be automatically reinvested in additional full and fractional
Shares unless a shareholder elects to receive cash. If Shares are
registered in nominee name, the shareholder should consult the nominee if
the shareholder desires to participate in the Plan. Shareholders that
participate in the Plan (Participants) may, at their option, make
additional cash investments in Shares, semi-annually in amounts of at least
$100, through payment to Shareholder Financial Services, Inc., the agent
for the Plan (the Agent), accompanied by a service fee of $.75.
Depending upon the circumstances hereinafter described, Plan Shares will be
acquired by the Agent for the Participant's account through receipt of
newly issued Shares or the purchase of outstanding Shares on the open
market. If the market price of Shares on the relevant date (normally the
payment date) equals or exceeds their net asset value, the Agent will ask
the Fund for payment of the Distribution in additional Shares at the
greater of the Fund's net asset value determined as of the date of purchase
or 95% of the then-current market price. If the market price is lower than
net asset value, the Distribution will be paid in cash, which the Agent
will use to buy Shares on the ASE, or otherwise on the open market to the
extent available. If the market price exceeds the net asset value before
the Agent has completed its purchases, the average purchase price per Share
paid by the Agent may exceed the net asset value, resulting in fewer Shares
being acquired than if the Distribution had been paid in Shares issued by
the Fund.
Participants may elect to withdraw from the Plan at any time and thereby
receive cash in lieu of Shares by sending appropriate written instructions
to the Agent. Elections received by the Agent will be effective only if
received more than ten days prior to the record date for any Distribution;
otherwise, such termination will be effective shortly after the investment
of such Distribution with respect to any subsequent
16
<PAGE> 17
Distribution. Upon withdrawal from or termination of the Plan, all Shares
acquired under the Plan will remain in the Participant's account unless
otherwise requested. For full Shares, the Participant may either: (1)
receive without charge a share certificate for such Shares; or (2) request
the Agent (after receipt by the Agent of signature guaranteed instructions
by all registered owners) to sell the Shares acquired under the Plan and
remit the proceeds less any brokerage commissions and a $2.50 service fee.
Fractional Shares may either remain in the Participant's account or be
reduced to cash by the Agent at the current market price with the proceeds
remitted to the Participant. Shareholders who have previously withdrawn
from the Plan may rejoin at any time by sending written instructions signed
by all registered owners to the Agent.
There is no direct charge for participation in the Plan; all fees of the
Agent are paid by the Fund. There are no brokerage charges for Shares
issued directly by the Fund. However, each Participant will pay a pro rata
share of brokerage commissions incurred with respect to open market
purchases of Shares to be issued under the Plan. Participants will receive
tax information annually for their personal records and to assist in
federal income tax return preparation. The automatic reinvestment of
Distributions does not relieve Participants of any income tax that may be
payable on Distributions.
The Plan may be terminated or amended at any time upon 30 days' prior
written notice to Participants which, with respect to a Plan termination,
must precede the record date of any Distribution by the Fund. Additional
information concerning the Plan may be obtained by shareholders holding
Shares registered directly in their names by writing the Agent, Shareholder
Financial Services, Inc., P.O. Box 173673, Denver, CO, 80217-3673 or by
calling 1-800-647-7374. Shareholders holding Shares in nominee name should
contact their brokerage firm or other nominee for more information.
SHAREHOLDER INFORMATION
Daily market prices for the Fund's shares are published in the ASE section
of newspapers. The Fund's ASE trading symbol is XTX. Weekly comparative net
asset value (NAV) and market price information about The New York
Tax-Exempt Income Fund, Inc. is published each Monday in The Wall Street
Journal and The New York Times and each Saturday in Barron's in a table
under the heading "Closed-End Bond Funds".
17
<PAGE> 18
(This Page Intentionally Left Blank)
<PAGE> 19
(This Page Intentionally Left Blank)
<PAGE> 20
THE NEW YORK TAX-EXEMPT INCOME FUND, INC.
Officers and Directors
James C. Swain, Chairman and Chief
Executive Officer
Robert G. Avis, Director
William A. Baker, Director
Charles Conrad, Jr., Director
Jon S. Fossel, Director and President
Raymond J. Kalinowski, Director
C. Howard Kast, Director
Robert M. Kirchner, Director
Ned M. Steel, Director
Andrew J. Donohue, Vice President
Robert E. Patterson, Vice President
George C. Bowen, Vice President,
Secretary and Treasurer
Robert J. Bishop, Assistant Treasurer
Scott Farrar, Assistant Treasurer
Robert G. Zack, Assistant Secretary
Investment Advisor
Oppenheimer Management Corporation
Transfer Agent and Registrar
Shareholder Financial Services, Inc.
Custodian of Portfolio Securities
Citibank, N.A.
Independent Auditors
Deloitte & Touche LLP
Legal Counsel
Myer, Swanson, Adams & Wolf, P.C.
This is a copy of a report to shareholders of The New York Tax-Exempt Income
Fund, Inc. It does not offer for sale or solicit orders to buy any
securities.
Notice is hereby given in accordance with Section 23(c) of the Investment
Company Act of 1940 that periodically the Fund may purchase its shares of
capital stock in the open market at prevailing market prices.
Shares of Oppenheimer funds are not deposits or obligations of any bank, are
not guaranteed by any bank, and are not insured by the FDIC or any other
agency, and involve investment risks, including possible loss of the
principal amount invested.
RA0875.001.1295 [LOGO] Printed on recycled paper
1995 ANNUAL REPORT
THE
NEW YORK
TAX-EXEMPT
INCOME
FUND, INC.
OCTOBER 31, 1995
[OPPENHEIMERFUNDS LOGO]
