<PAGE>
OPPENHEIMER MAIN STREET CALIFORNIA TAX-EXEMPT FUND
ANNUAL REPORT JUNE 30, 1995
[Photo]
"We want investment INCOME that won't add to our taxes."
[Logo]
<PAGE>
This Fund is for people who need INCOME that's EXEMPT from taxes.
HOW YOUR FUND IS MANAGED
Oppenheimer Main Street California Tax-Exempt Fund invests in a diversified
portfolio of California municipal bonds. As a Fund shareholder, you receive
income that is free from federal and state income taxes.(1) Your dividends don't
increase your taxable income the way taxable investments do, so you can keep
more of what you earn.
Main Street California Tax-Exempt Fund is managed by an experienced team of
municipal bond specialists who research investments thoroughly before they are
included in the Fund's portfolio.
PERFORMANCE
Total return at net asset value for the 12
months ended 6/30/95 was 8.93% for Class A shares and 7.90% for Class B
shares.(2)
Your Fund's average annual total returns at maximum offering price for
Class A shares for the 1- and 5-year periods ended 6/30/95 and since inception
of the Class on 5/18/90 were 3.75%, 6.85% and 7.17%, respectively. For Class B
shares, average annual total returns for the 1-year period ended 6/30/95 and
since inception of the Class on 10/29/93 were 2.90% and -1.02%, respectively.(3)
NEWS
STANDARDIZED YIELD
For the 30 Days Ended 6/30/95:(4)
Class A
4.93%
Class B
3.96%
BEAT THE AVERAGE
Total Return for the 1-Year Period Ended 6/30/95:
Oppenheimer Main Street California Tax-Exempt Fund (at net asset value)(2)
8.93%
Lipper California Municipal
Debt Funds Average(5)
7.58%
The Fund's Class A shares are ranked **** among 685 municipal bond funds for
the 3- and 5-year periods ended 6/30/95.(6)
OUTLOOK
"We believe the current market is fairly valued. There are still plenty of
positives, along with a good supply and demand relationship. As far as the Fund
is concerned, in the first half of the year, we realized significant
appreciation. For the remainder of the year, we expect a stable market. Relative
to other fixed income securities and against a low inflation backdrop, the
outlook for muni bonds is very good."
Robert Patterson, Portfolio Manager
June 30, 1995
All figures assume reinvestment of dividends and capital gains distributions.
Past performance is not indicative of future results. Investment and principal
value on an investment in the Fund will fluctuate so that an investor's shares,
when redeemed, may be worth more or less than the original cost.
1. A portion of the distributions paid by the Fund may be subject to federal and
state income taxes. For investors subject to federal and/or state alternative
minimum tax (AMT), the Fund's distributions may increase this tax. Capital gains
distributions, if any, are taxed as capital gains.
2. Based on the change in net asset value per share for the period shown,
without deducting any sales charges. Such performance would have been lower if
sales charges were taken into account.
3. Class A returns show results of hypothetical investments on 6/30/94, 6/30/90
and 5/18/90 (inception of class), after deducting the current maximum initial
sales charge of 4.75%. Class B returns show results of hypothetical investments
on 6/30/94 and 10/29/93 (inception of class), and the deduction of the
applicable contingent deferred sales charge of 5% (1 year) and 4% (since
inception). An explanation of the different performance calculations is in the
Fund's prospectus.
4. Standardized yield is net investment income calculated on a yield-to-maturity
basis for the 30-day period ended 6/30/95, divided by the maximum offering price
at the end of the period, compounded semiannually and then annualized. Falling
net asset values will tend to artificially raise yields.
5. Source: Lipper Analytical Services. The Lipper total return average for the
1-year period was for 85 California municipal debt funds. The average is shown
for comparative purposes only. Oppenheimer Main Street California Tax-Exempt
Fund is characterized by Lipper as a California municipal debt fund. Lipper
performance does not take sales charges into consideration.
6. Source: MORNINGSTAR MUTUAL FUNDS, 6/30/95. Morningstar, Inc., an independent
mutual fund monitoring service, produces proprietary monthly rankings of funds
in broad investment categories (equity, taxable bond, tax-exempt bond, or
"hybrid") based on risk-adjusted investment returns, after considering sales
charges and expenses. Investment return measures a fund's (or class's) 3-, 5-
and 10-year (depending on the inception of the class or fund) average annual
total returns in excess of 90-day U.S. Treasury bill returns. Risk measures a
fund's (or class's) performance below 90-day U.S. Treasury bill returns. Risk
and returns are combined to produce star rankings, reflecting performance
relative to the average fund in a fund's category. Five stars is the "highest"
ranking (top 10%), 4 stars is "above average" and 1 star is the "lowest" (bottom
1%). The 4-star current ranking is a weighted average of the 3- and 5-year
rankings for the class, which were both 4 stars, respectively, weighted 40% and
60%, respectively. There were 685 and 468 funds ranked in these respective
periods. Rankings are subject to change. The Fund's Class A and Class B shares
have the same portfolio.
2 Oppenheimer Main Street California Tax-Exempt Fund
<PAGE>
DEAR OPPENHEIMERFUNDS SHAREHOLDER,
In contrast to last year, the first half of 1995 has been exceptionally good for
the bond market. Almost all types of bonds have participated in the upswing and,
in many cases, have more than made up for last year's declines in the first half
alone--rewarding investors who were patient through the market's short-term
difficulties. The strength of the current market adds to evidence showing, once
again, that profitable investing calls for a long-term perspective.
The single most important factor behind the rally was a change in the
Federal Reserve's monetary policy. From February 1994 to February 1995, the Fed
raised rates aggressively to preempt possible inflation by slowing the economy
to a more moderate growth rate, thus prolonging the current cycle of economic
growth. As evidence began to mount that indicated the economy was indeed
slowing, the Fed stopped raising rates.
Like most bonds, municipal bonds benefited from the Fed's moves, but they
also gained for a number of other reasons. First, the income municipal or
tax-free bonds pay is currently very attractive compared to the after-tax income
from other fixed income investments. This has made them appealing to investors
whose primary goal is income. In addition, relatively short supply and increased
demand for municipal bonds--particularly in regions with high tax rates--have
supported higher prices.
We believe the municipal bond market is strong today; however, the ongoing
congressional budget talks may have an effect as the year continues. State
governments are under financial pressure as the Federal government moves to
reduce the deficit. Thus, states and municipalities may find that although they
will be in a position of having greater say over how money is spent locally,
they will have less money overall--lowering the ratings of some bonds, thus
decreasing the number of quality issues available. Careful credit analysis will
play an even more important role in selecting investments. The good news is that
your managers have always believed in careful analysis and will continue to
steer the Fund toward promising investment opportunities.
Going forward, your Fund's management team is optimistic, but somewhat more
conser-vative. Municipal bonds have experienced tremendous capital appreciation
during the first half of this year, and your managers want to avoid giving back
gains the Fund has made. Our goal remains to combine the income needs of our
shareholders with a desire to limit risk. Your managers believe the Fund will be
in a strong position to do both for the remainder of the year and in the future.
Your portfolio manager discusses the outlook for your Fund on the following
pages. Thank you for your confidence in OppenheimerFunds, and we look forward to
helping you continue to reach your investment goals in the future.
[Photo]
James C. Swain
Chairman
Oppenheimer
Main Street California
Tax-Exempt Fund
[Photo]
Jon S. Fossel
President
Oppenheimer
Main Street California
Tax-Exempt Fund
/s/ James C. Swain /s/ Jon S. Fossel
James C. Swain Jon S. Fossel
July 24, 1995
3 Oppenheimer Main Street California Tax-Exempt Fund
<PAGE>
Q + A
[Photo] [Photo]
Q WHAT IS YOUR OUTLOOK FOR THE MUNICIPAL MARKET?
AN INTERVIEW WITH YOUR FUND'S MANAGER.
THE FUND HAS PERFORMED VERY WELL OVER THE LAST 12 MONTHS,
AS IT BEAT THE LIPPER CALIFORNIA MUNICIPAL DEBT FUND AVERAGE FOR THE 1-YEAR
PERIOD ENDED JUNE 30, 1995. WHAT FACTORS AFFECTED THE MUNICIPAL BOND MARKET
SINCE THE LAST REPORT?
Municipal bonds had a strong run since Thanksgiving of last year and
particularly in the first quarter of this year. Toward the end of last year,
interest rates began to decline and the fixed income markets started to rally,
and most bonds participated in the rally. This, in turn, increased demand for
municipal bonds and put pressure on the already short supply. As a result, the
increased demand and short supply pushed prices higher. Thus, municipal bonds
expe-rienced significant capital appreciation over the past six months.
Because we anticipated the rally, the Fund was well positioned, and we were
able to take advantage of the positive market environment.
WHAT CHANGES HAVE YOU MADE AS A RESULT OF THE BOND RALLY?
Most of the changes we made occurred last November, when we began to anticipate
a turnaround.
We've increased our holdings of prerefunded and insured bonds in the
portfolio--these issues were hit hardest in 1994's tough market, so they've
provided the greatest appreciation since the turnaround.
We've also been selling positions in par bonds, which we bought at a
discount and which have now reached par value. Our thinking here is that having
reached par, they may underperform in the future.
In addition, we've recently moved part of the portfolio into California
Housing Finance Agency (HFA) bonds. These are AA-rated bonds that offer
a yield premium over many other top-rated issues.1
1. The Fund's porfolio is subject to change.
4 Oppenheimer Main Street California Tax-Exempt Fund
<PAGE>
Facing page
Top left: Robert Patterson,
Portfolio Manager
Top right: The trading desk
Bottom: Len Darling, Executive VP,
Director of Fixed Income Investments, with Jon Fossel,
CEO and Chairman, Oppenheimer Management Corporation
This page
Right: Robert Patterson
Below: Len Darling with Caryn Halbrecht, Tax-Exempt Portfolio Manager
A THE LONG-TERM OUTLOOK FOR THE MARKET REMAINS POSITIVE.
WITH A RECORD NUMBER OF BOND CALLS EXPECTED THIS SUMMER, HOW ARE YOU POSITIONING
THE PORTFOLIO TO PROTECT INCOME?
The calls--or built-in opportunities for issuers to buy back bonds prior to
maturity--we expect to see will continue to bolster the favorable supply/demand
characteristics in the muni bond market.
Other than that, we don't expect to feel much effect from the number of
bond calls. We invest primarily in bonds with "call protection," a feature that
allows us to be the ones who decide how long we'll own a bond. We've always
considered call protection an important feature, so the Fund is fairly well
insulated against call risk.
WHAT IS YOUR OUTLOOK FOR THE MUNICIPAL BOND MARKET?
Favorable economic fundamentals and strong technical factors, namely the
imbalance between supply and demand, continue to create a positive environment
for municipal bonds going forward.
This year, demand for municipal bonds is expected to outstrip supply, which
we believe should continue. While this "positive" for munis has been briefly
offset by concerns from various tax reform pro-posals, we believe that these
fears are overblown and the long-term outlook for the market remains positive.
WHAT IS YOUR OUTLOOK FOR THE FUND?
We believe the current market is fairly valued. As stated before, there are
still plenty of positives, along with a good supply and demand relationship.
As far as the Fund is concerned, in the first half of the year, we realized
significant appreciation. For the remainder of the year, we expect a stable
market.
Relative to other fixed income securities and against a low inflation
backdrop, the outlook for the Fund is very good. Investors were well compensated
for waiting out last year's market, and we believe the current strength should
persist through 1995 and into next year./ /
5 Oppenheimer Main Street California Tax-Exempt Fund
<PAGE>
<TABLE>
<CAPTION>
STATEMENT OF INVESTMENTS June 30, 1995
RATINGS: MOODY'S/
S&P'S/FITCH'S FACE MARKET VALUE
(UNAUDITED) AMOUNT SEE NOTE 1
<S> <C> <C> <C> <C>
- ---------------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------------
MUNICIPAL BONDS AND NOTES--96.1%
- ---------------------------------------------------------------------------------------------------------------------------------
CALIFORNIA--81.9% Alameda County, California Certificates of
Participation, Prerefunded, BIG Insured, 7.25%, 6/1/09 Aaa/AAA $1,635,000 $1,867,068
---------------------------------------------------------------------------------------------------
Anaheim, California Public Financing Authority
Tax Allocation Revenue Bonds, MBIA Insured,
6.45%, 12/28/18 Aaa/AAA 2,000,000 2,074,114
---------------------------------------------------------------------------------------------------
California Health Facilities Financing Authority
Revenue Bonds, Episcopal Homes Project,
Series A, OSHPD Insured, 7.80%, 7/1/15 NR/A 1,000,000 1,071,812
---------------------------------------------------------------------------------------------------
California Health Facilities Financing Authority
Revenue Refunding Bonds, Catholic Health Care
West, Series A, MBIA Insured, 5%, 7/1/11 Aaa/AAA 2,500,000 2,273,852
---------------------------------------------------------------------------------------------------
California Housing Finance Agency Revenue Bonds,
Home Mtg., Series C, 6.75%, 2/1/25 Aa/AA- 5,000,000 5,065,770
---------------------------------------------------------------------------------------------------
California Housing Finance Agency Single Family Mtg.
Purchase Revenue Bonds, Series A-2, 6.45%, 8/1/25 Aaa/AAA 2,500,000 2,512,050
---------------------------------------------------------------------------------------------------
California Pollution Control Financing Authority
Revenue Bonds, Pacific Gas & Electric Co.,
Series B, 6.35%, 6/1/09 A2/A 2,000,000 2,039,602
---------------------------------------------------------------------------------------------------
California State Department of Water Resources
Central Valley Project Revenue Bonds,
Series L, 5.50%, 12/1/23 Aa/AA 2,000,000 1,846,410
---------------------------------------------------------------------------------------------------
California State General Obligation Bonds,
FSA Insured, 5.50%, 4/1/19 Aaa/AAA/A 2,500,000 2,318,750
---------------------------------------------------------------------------------------------------
Capistrano, California Unified School District
Community Facilities District Special Tax Bonds,
No. 87-1, 7.60%, 9/1/14 NR/NR 1,000,000 960,948
---------------------------------------------------------------------------------------------------
Contra Costa, California Water District
Revenue Bonds, Prerefunded, Series A, 6.875%, 10/1/20 NR/NR 1,100,000 1,235,314
---------------------------------------------------------------------------------------------------
Corona, California Certificates of Participation,
Prerefunded, Series B, 10%, 11/1/20 Aaa/AAA 3,250,000 4,344,606
---------------------------------------------------------------------------------------------------
Foothill/Eastern Transportation Corridor Agency
California Toll Road Revenue Bonds, Sr. Lien,
Series A, 6.50%, 1/1/32 NR/BBB-/BBB 1,400,000 1,350,905
---------------------------------------------------------------------------------------------------
Los Angeles County, California Transportation
Revenue Bonds, Commission Sales Tax,
Prerefunded, Series A, FGIC Insured, 6.75%, 7/1/18 Aaa/AAA/AAA 1,000,000 1,125,198
---------------------------------------------------------------------------------------------------
Los Angeles, California Convention & Exhibition
Center Authority Refunding Certificates of
Participation, Prerefunded, Series A, 7.375%, 8/15/18 Aaa/AAA 1,000,000 1,120,570
---------------------------------------------------------------------------------------------------
Los Angeles, California Wastewater System Revenue
Refunding Bonds, Series D, FGIC Insured, 8.70%, 11/1/03 Aaa/AAA/AAA 5,115,000 6,316,881
</TABLE>
6 Oppenheimer Main Street California Tax-Exempt Fund
<PAGE>
<TABLE>
<CAPTION>
RATINGS: MOODY'S/
S&P'S/FITCH'S FACE MARKET VALUE
(UNAUDITED) AMOUNT SEE NOTE 1
<S> <C> <C> <C> <C>
- ---------------------------------------------------------------------------------------------------------------------------------
CALIFORNIA Metropolitan Water District of Southern California
(CONTINUED) Revenue Bonds, Waterworks Project, 5%, 7/1/20 Aa/AA $2,500,000 $2,169,650
---------------------------------------------------------------------------------------------------
Metropolitan Water District of Southern California
Revenue Bonds, Waterworks Project, Inverse
Floater, 6.05%, 10/30/20(1) Aa/AA 1,500,000 1,260,000
---------------------------------------------------------------------------------------------------
Northern California Transmission Agency Revenue
Bonds, California-Oregon Transmission Project,
Prerefunded, Series A, MBIA Insured, 7%, 5/1/24 Aaa/AAA 500,000 557,480
---------------------------------------------------------------------------------------------------
Orange County, California Community Facilities
District No. 87-3 Special Tax Bonds, Prerefunded,
Series A, 8.05%, 8/15/08 NR/NR 1,480,000 1,667,406
---------------------------------------------------------------------------------------------------
Orange County, California Community Facilities
District Special Tax Bonds, No. 88-1 Aliso Viejo,
Prerefunded, Series A, 7.35%, 8/15/18 NR/AAA 2,000,000 2,342,346
---------------------------------------------------------------------------------------------------
Pittsburg, California Improvement Bond Act of 1915
Bonds, Assessment District 1990-01, 7.75%, 9/2/20 NR/NR 95,000 97,856
---------------------------------------------------------------------------------------------------
Redding, California Electric System Revenue
Certificates of Participation, FGIC Insured,
Inverse Floater, 7.10%, 6/28/19(1) Aaa/AAA/AAA 1,150,000 1,025,663
---------------------------------------------------------------------------------------------------
Redding, California Electric System Revenue
Certificates of Participation, MBIA Insured,
Inverse Floater, 8.396%, 7/8/22(1) Aaa/AAA 500,000 535,585
---------------------------------------------------------------------------------------------------
Riverside County, California Community Facilities
District Bonds, Special Tax No. 88-12, 7.55%, 9/1/17 NR/NR 1,500,000 1,507,159
---------------------------------------------------------------------------------------------------
Sacramento, California Municipal Utility District
Electric Revenue Refunding Bonds, Series B, FGIC
Insured, Inverse Floater, 8.261%, 8/15/18(1) Aaa/AAA/AAA 1,500,000 1,483,543
---------------------------------------------------------------------------------------------------
Sacramento, California Municipal Utility
District Electric Revenue Refunding Bonds,
Series D, MBIA Insured, 5.25%, 11/15/20 Aaa/AAA/A- 2,000,000 1,798,442
---------------------------------------------------------------------------------------------------
San Bernardino County, California Certificates
of Participation, Medical Center Financing
Project, 5.50%, 8/1/17 Baa1/A- 2,500,000 2,148,832
---------------------------------------------------------------------------------------------------
San Diego County, California Water Authority
Revenue Certificates of Participation, Series B,
MBIA Insured, Inverse Floater, 8.07%, 4/8/21(1) Aaa/AAA 1,000,000 1,011,505
---------------------------------------------------------------------------------------------------
San Francisco, California Bay Area Rapid
Transit District Revenue Refunding Bonds,
AMBAC Insured, 6.75%, 7/1/11 Aaa/AAA/AAA 1,000,000 1,117,116
---------------------------------------------------------------------------------------------------
San Joaquin Hills, California Transportation Corridor
Agency Toll Road Revenue Bonds, Sr. Lien, 6.75%, 1/1/32 NR/NR/BBB 3,500,000 3,495,268
---------------------------------------------------------------------------------------------------
South Orange County, California Public Financing
Authority Special Tax Revenue Bonds, Sr. Lien,
Series A, MBIA Insured, 6.20%, 9/1/13 Aaa/AAA 1,000,000 1,002,059
</TABLE>
7 Oppenheimer Main Street California Tax-Exempt Fund
<PAGE>
STATEMENT OF INVESTMENTS (Continued)
<TABLE>
<CAPTION>
RATINGS: MOODY'S/
S&P'S/FITCH'S FACE MARKET VALUE
(UNAUDITED) AMOUNT SEE NOTE 1
<S> <C> <C> <C> <C>
- ---------------------------------------------------------------------------------------------------------------------------------
CALIFORNIA Southern California Home Financing Authority Single
(CONTINUED) Family Mtg. Revenue Bonds, GNMA and FNMA
Mtg.-Backed Securities, Series A, 7.35%, 9/1/24 NR/AAA $ 285,000 $ 298,192
---------------------------------------------------------------------------------------------------
Southern California Public Power Authority
Transmission Project Revenue Bonds, Inverse
Floater, 6.644%, 7/1/12(1) Aa/AA- 2,500,000 2,403,710
---------------------------------------------------------------------------------------------------
University of California Revenue Bonds,
Multiple Purpose Projects, Prerefunded,
Series A, 6.875%, 9/1/16 NR/A- 1,000,000 1,141,743
---------------------------------------------------------------------------------------------------
Victorville, California Special Tax Bonds,
Community Facilities District No. 90-1
Series A, 8.30%, 9/1/16 NR/NR 450,000 428,059
---------------------------------------------------------------------------------------------------
West Basin, California Municipal Water District
Certificates of Participation, Prerefunded,
AMBAC Insured, 6.85%, 8/1/16 Aaa/AAA/AAA 1,000,000 1,117,307
-----------
66,132,771
- ---------------------------------------------------------------------------------------------------------------------------------
U.S. POSSESSIONS--14.2% Puerto Rico Commonwealth General Obligation
Bonds, Yield Curve Notes, MBIA Insured, Inverse
Floater, 7.384%, 7/1/08(1) Aaa/AAA 1,500,000 1,528,726
---------------------------------------------------------------------------------------------------
Puerto Rico Commonwealth Highway Authority
Revenue Bonds, Prerefunded, Series P, 8.125%, 7/1/13 Aaa/AAA 2,000,000 2,251,906
---------------------------------------------------------------------------------------------------
Puerto Rico Commonwealth Public Improvement
General Obligation Bonds, Prerefunded, 7.25%, 7/1/12 NR/AAA 1,430,000 1,545,016
---------------------------------------------------------------------------------------------------
Puerto Rico Commonwealth Public Improvement
General Obligation Bonds, Prerefunded,
Series A, 7.75%, 7/1/17 NR/AAA 1,000,000 1,134,722
---------------------------------------------------------------------------------------------------
Puerto Rico Housing Bank & Finance Agency
Single Family Mtg. Revenue Bonds, Affordable
Housing Mtg.--Portfolio I, 6.25%, 4/1/29 Aaa/AAA 2,000,000 1,991,390
---------------------------------------------------------------------------------------------------
Puerto Rico Housing Finance Corp. Single Family Mtg.
Revenue Bonds, Portfolio 1, Series B, 7.65%, 10/15/22 Aaa/AAA 320,000 338,844
---------------------------------------------------------------------------------------------------
Puerto Rico Public Buildings Authority Guaranteed
Public Education and Health Facilities
Revenue Bonds, Prerefunded, Series H, 7.875%, 7/1/07 Aaa/AAA 2,500,000 2,728,595
---------------------------------------------------------------------------------------------------
11,519,199
-----------
Total Municipal Bonds and Notes (Cost $78,143,613) 77,651,970
- ---------------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------------
SHORT-TERM TAX-EXEMPT OBLIGATIONS--2.5%
- ---------------------------------------------------------------------------------------------------------------------------------
California Health Facilities Financing Authority
Revenue Bonds, Kaiser Permanente Medical Center
Project, Series B, 3.90% (Cost $2,000,000)(2) 2,000,000 2,000,000
- ---------------------------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENTS, AT VALUE (COST $80,143,613) 98.6% 79,651,970
- ---------------------------------------------------------------------------------------------------------------------------------
OTHER ASSETS NET OF LIABILITIES 1.4 1,130,735
------ -----------
NET ASSETS 100.0% $80,782,705
------ -----------
------ -----------
</TABLE>
8 Oppenheimer Main Street California Tax-Exempt Fund
<PAGE>
- -------------------------------------------------------------------------------
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 $9,248,732 or 11.4% of the Fund's
net assets, at June 30, 1995.
2. Floating or variable rate obligation maturing in more
than one year. The interest rate, which is based on
specific, or an index of, market interest rates, is subject
to change periodically and is the effective rate on June 30,
1995. This instrument may also have a demand feature which
allows the recovery of principal at any time, or at
specified intervals not exceeding one year, on up to 30
days' notice. Maturity date shown represents effective
maturity based on variable rate and, if applicable, demand
feature.
Distribution of investments by industry, as a percentage of
total investments at value, is as follows:
<TABLE>
<CAPTION>
INDUSTRY MARKET VALUE PERCENT
-----------------------------------------------------------
<S> <C> <C>
Utilities $22,761,490 28.6%
Housing 10,206,246 12.8
Special Tax Bonds 10,079,947 12.7
Lease/Rental 9,481,077 11.9
Transportation 9,340,392 11.7
General Obligation Bonds 9,255,809 11.6
Hospitals 3,345,664 4.2
Pollution Control 2,039,602 2.6
Industrial Development 2,000,000 2.5
Education 1,141,743 1.4
----------- ------
$79,651,970 100.0%
----------- ------
----------- ------
</TABLE>
See accompanying Notes to Financial Statements.
9 Oppenheimer Main Street California Tax-Exempt Fund
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES June 30, 1995
<TABLE>
<S> <C> <C>
- -------------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------------
ASSETS Investments, at value (cost $80,143,613)--see accompanying statement $79,651,970
-------------------------------------------------------------------------------------------------
Cash 177,049
-------------------------------------------------------------------------------------------------
Receivables:
Interest 1,531,628
Shares of capital stock sold 45,617
-------------------------------------------------------------------------------------------------
Other 5,808
-----------
Total assets 81,412,072
- -------------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------------
LIABILITIES Payables and other liabilities:
Shares of capital stock redeemed 323,109
Dividends 279,629
Directors' fees 1,998
Distribution and service plan fees--Note 4 1,556
Transfer and shareholder servicing agent fees 1,550
Other 21,525
-----------
Total liabilities 629,367
- -------------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------------
NET ASSETS $80,782,705
-----------
-----------
- -------------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------------
COMPOSITION OF Par value of shares of capital stock $66,810
NET ASSETS -------------------------------------------------------------------------------------------------
Additional paid-in capital 81,285,897
-------------------------------------------------------------------------------------------------
Overdistributed net investment income (98,805)
-------------------------------------------------------------------------------------------------
Accumulated net realized gain from investment transactions 20,446
-------------------------------------------------------------------------------------------------
Net unrealized depreciation on investments--Note 3 (491,643)
-----------
Net assets $80,782,705
-----------
-----------
- -------------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE Class A Shares:
PER SHARE Net asset value and redemption price per share (based on
net assets of $78,134,279 and 6,461,742 shares of capital stock outstanding) $12.09
Maximum offering price per share (net asset value
plus sales charge of 4.75% of offering price) $12.69
-------------------------------------------------------------------------------------------------
Class B Shares:
Net asset value, redemption price and offering price per share (based on net assets
of $2,648,426 and 219,253 shares of capital stock outstanding) $12.08
</TABLE>
See accompanying Notes to Financial Statements.
10 Oppenheimer Main Street California Tax-Exempt Fund
<PAGE>
STATEMENT OF OPERATIONS For the Year Ended June 30, 1995
<TABLE>
- -------------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
INVESTMENT INCOME Interest $5,332,382
- -------------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------------
EXPENSES Management fees--Note 4 284,916
-------------------------------------------------------------------------------------------------
Transfer and shareholder servicing agent fees--Note 4 71,023
-------------------------------------------------------------------------------------------------
Shareholder reports 43,051
-------------------------------------------------------------------------------------------------
Distribution and service plan fees: Class B--Note 4 18,367
-------------------------------------------------------------------------------------------------
Legal and auditing fees 15,655
-------------------------------------------------------------------------------------------------
Custodian fees and expenses 6,613
-------------------------------------------------------------------------------------------------
Directors' fees and expenses 3,000
-------------------------------------------------------------------------------------------------
Registration and filing fees:
Class A 1,741
Class B 540
-------------------------------------------------------------------------------------------------
Other 15,101
-----------
Total expenses 460,007
- -------------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------------
NET INVESTMENT INCOME 4,872,375
- -------------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------------
REALIZED AND UNREALIZED Net realized gain on investments 21,062
GAIN ON INVESTMENTS -------------------------------------------------------------------------------------------------
Net change in unrealized appreciation or depreciation on investments 1,550,552
-----------
Net realized and unrealized gain on investments 1,571,614
- -------------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $6,443,989
-----------
-----------
</TABLE>
See accompanying Notes to Financial Statements.
11 Oppenheimer Main Street California Tax-Exempt Fund
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
YEAR ENDED JUNE 30,
1995 1994
<S> <C> <C> <C>
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
OPERATIONS Net investment income $ 4,872,375 $ 4,995,312
-----------------------------------------------------------------------------------------------------
Net realized gain (loss) on investments 21,062 (102,647)
-----------------------------------------------------------------------------------------------------
Net change in unrealized appreciation or depreciation on investments 1,550,552 (5,742,053)
----------- -----------
Net increase (decrease) in net assets resulting from operations 6,443,989 (849,388)
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
DIVIDENDS AND Dividends from net investment income:
DISTRIBUTIONS TO Class A ($.694 and $.729 per share, respectively) (4,502,183) (4,729,265)
SHAREHOLDERS Class B ($.573 and $.37 per share, respectively) (89,348) (19,459)
-----------------------------------------------------------------------------------------------------
Dividends in excess of net investment income:
Class A ($.040 and $.028 per share, respectively) (258,329) (179,070)
Class B ($.040 and $.014 per share, respectively) (8,756) (737)
-----------------------------------------------------------------------------------------------------
Distributions in excess of net realized gain on investments:
Class A ($.028 per share) -- (186,921)
Class B ($.028 per share) -- (599)
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
CAPITAL STOCK Net increase (decrease) in net assets resulting from
TRANSACTIONS Class A capital stock transactions--Note 2 (2,943,992) 13,070,898
-----------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting from
Class B capital stock transactions--Note 2 1,383,961 1,264,874
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
NET ASSETS Total increase 25,342 8,370,333
-----------------------------------------------------------------------------------------------------
Beginning of period 80,757,363 72,387,030
----------- -----------
End of period (including overdistributed net investment income
of $98,805 and $95,768, respectively) $80,782,705 $80,757,363
----------- -----------
----------- -----------
</TABLE>
See accompanying Notes to Financial Statements.
12 Oppenheimer Main Street California Tax-Exempt Fund
<PAGE>
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
CLASS A CLASS B
------------------------------------------------------------------ ------------------
YEAR ENDED JUNE 30, YEAR ENDED JUNE 30,
1995 1994 1993 1992 1991 1990(2) 1995 1994(1)
- ---------------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
PER SHARE OPERATING DATA:
Net asset value, beginning of period $11.82 $12.66 $12.05 $11.61 $11.56 $11.43 $11.80 $12.90
- --------------------------------------------------------------------------------------------------------------------------------
Income (loss) from
investment operations:
Net investment income .73 .75 .80 .82 .83(3) .06(3) .62 .38
Net realized and unrealized
gain (loss) on investments .27 (.80) .64 .45 .05 .13 .27 (1.07)
------- ------ ------ ------ ------ ------ ------ ------
Total income (loss)
from investment operations 1.00 (.05) 1.44 1.27 .88 .19 .89 (.69)
- -----------------------------------------------------------------------------------------------------------------------------------
Dividends and distributions to shareholders:
Dividends from net
investment income (.69) (.73) (.81) (.82) (.83) (.06) (.57) (.37)
Dividends in excess of net
investment income (.04) (.03) -- -- -- -- (.04) (.01)
Distributions from net realized
gain on investments -- -- (.02) (.01) -- -- -- --
Distributions in excess of net
realized gain on investments -- (.03) -- -- -- -- -- (.03)
------- ------ ------ ------ ------ ------ ------ ------
Total dividends and
distributions to shareholders (.73) (.79) (.83) (.83) (.83) (.06) (.61) (.41)
- -----------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $12.09 $11.82 $12.66 $12.05 $11.61 $11.56 $12.08 $11.80
------- ------ ------ ------ ------ ------ ------ ------
------- ------ ------ ------ ------ ------ ------ ------
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE(4) 8.93% (.60)% 12.53% 11.21% 7.94% 1.95% 7.90% (5.42)%
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period
(in thousands) $78,134 $79,555 $72,387 $40,055 $13,924 $2,027 $2,648 $1,203
- -----------------------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $76,148 $81,741 $54,840 $26,304 $6,661 $1,685 $1,904 $649
- -----------------------------------------------------------------------------------------------------------------------------------
Number of shares outstanding
at end of period (in thousands) 6,462 6,732 5,719 3,324 1,199 175 219 102
- -----------------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets:
Net investment income 6.27% 6.09% 6.46% 6.74% 6.94% 5.48%(5) 5.17% 4.91%(5)
Expenses .57% .53% .39% .32% .33%(3) .20%(3)(5) 1.55% 1.62%(5)
- -----------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate(6) 14.2% 20.2% 5.8% 25.7% 14.6% 0.0% 14.2% 20.2%
<FN>
1. For the period from October 29, 1993 (inception of offering)
to June 30, 1994.
2. For the period from May 18, 1990 (commencement of operations)
to June 30, 1990.
3. Net investment income would have been $.82 and $.04 per share
in 1991 and 1990 absent the voluntary expense assumption,
resulting in an expense ratio of .42% and 1.93%, respectively.
4. Assumes a hypothetical initial investment 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 redemption at the net asset value calculated on the
last business day of the fiscal period. Sales charges are not
reflected in the total returns. Total returns are not annualized
for periods of less than one full year.
5. Annualized.
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 June 30, 1995 were $10,984,988 and
$14,179,152, respectively.
See accompanying Notes to Financial Statements.
</TABLE>
13 Oppenheimer Main Street California Tax-Exempt Fund
<PAGE>
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
1. SIGNIFICANT Oppenheimer Main Street California Tax-Exempt Fund
ACCOUNTING POLICIES (the Fund) is a separate series of Oppenheimer Main
Street Funds, Inc., an open-end management investment
company registered under the Investment Company Act
of 1940, as amended. The Fund's investment advisor is
Oppenheimer Management Corporation (the Manager). The
Fund offers both Class A and Class B shares. Class A
shares are sold with a front-end sales charge. Class
B shares may be subject to a contingent deferred
sales charge. Both classes of shares have identical
rights to earnings, assets and voting privileges,
except that each class has its own expenses directly
attributable to a particular class and exclusive
voting rights with respect to matters affecting a
single class. In addition, Class B shares have their
own distribution plan and will automatically convert
to Class A shares six years after the date of
purchase. 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 New York Stock Exchange on each
trading day. 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 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.
-----------------------------------------------------
ALLOCATION OF INCOME, EXPENSES AND GAINS AND LOSSES.
Income, expenses (other than those attributable to a
specific class) and gains and losses are allocated
daily to each class of shares based upon the relative
proportion of net assets represented by such class.
Operating expenses directly attributable to a
specific class are charged against the operations of
that class.
-----------------------------------------------------
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.
-----------------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS. The Fund intends to
declare dividends separately for Class A and Class B
shares from net investment income each day the New
York Stock Exchange is open for business and pay such
dividends 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 June 30, 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, amounts have been reclassified to
reflect a decrease in paid-in capital of $938, an
increase in overdistributed net investment income of
$16,796, and an increase in accumulated net realized
gain on investments of $17,734.
-----------------------------------------------------
OTHER. Investment transactions are accounted for on
the date the investments are purchased or sold (trade
date) and dividend income is recorded on the
ex-dividend date. Original issue 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 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.
14 Oppenheimer Main Street California Tax-Exempt Fund
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
2. CAPITAL STOCK The Fund has authorized 26,250,000 shares of $.01 par
value capital stock of each class. Transactions in
shares of capital stock were as follows:
<TABLE>
<CAPTION>
YEAR ENDED JUNE 30, 1995 YEAR ENDED JUNE 30, 1994(1)
----------------------------- ---------------------------
SHARES AMOUNT SHARES AMOUNT
--------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class A:
Sold 549,187 $ 6,492,313 1,640,622 $20,818,911
Dividends and distributions reinvested 262,815 3,070,057 275,074 3,448,622
Redeemed (1,081,996) (12,506,362) (903,096) (11,196,635)
---------- ----------- --------- -----------
Net increase (decrease) (269,994) $(2,943,992) 1,012,600 $13,070,898
---------- ----------- --------- -----------
---------- ----------- --------- -----------
--------------------------------------------------------------------------------------------------------
Class B:
Sold 125,642 $ 1,482,012 101,400 $ 1,258,622
Dividends and distributions reinvested 4,898 57,310 1,061 12,907
Redeemed (13,193) (155,361) (555) (6,655)
---------- ----------- --------- -----------
Net increase 117,347 $ 1,383,961 101,906 $ 1,264,874
---------- ----------- --------- -----------
---------- ----------- --------- -----------
<FN>
1. For the year ended June 30, 1994 for Class A
shares and for the period from October 29, 1993
(inception of offering) to June 30, 1994 for Class B
shares.
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
3. UNREALIZED GAINS AND At June 30, 1995, net unrealized depreciation on
LOSSES ON INVESTMENTS investments of $491,643 was composed of gross
appreciation of $1,404,320, and gross depreciation of
$1,895,963.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
4. MANAGEMENT FEES AND Management fees paid to the Manager were in
OTHER TRANSACTIONS accordance with the investment advisory agreement
WITH AFFILIATES with the Fund which provides for a fee of .55% of
average annual net assets, with a contractual waiver
when net assets are less than $100 million. Annual
fees, reflecting this waiver, are .40% of net assets
of $75 million or more but less than $100 million,
.25% of net assets of $50 million or more but less
than $75 million, .15% of net assets of $25 million
or more but less than $50 million, and 0% of net
assets less than $25 million. The Manager has agreed
to assume Fund expenses (with specified exceptions)
in excess of the regulatory limitation of the state
of California.
For the year ended June 30, 1995,
commissions (sales charges paid by investors) on
sales of Class A shares totaled $177,634, of which
$28,801 was retained by Oppenheimer Funds
Distributor, Inc. (OFDI), a subsidiary of the
Manager, as general distributor, and by an affiliated
broker/dealer. Sales charges advanced to
broker/dealers by OFDI on sales of the Fund's Class B
shares totaled $52,930. During the year ended June
30, 1995, OFDI received contingent deferred sales
charges of $6,447 upon redemption of Class B shares.
Oppenheimer Shareholder Services
(OSS), a division of the Manager, is the transfer and
shareholder servicing agent for the Fund, and for
other registered investment companies. OSS's total
costs of providing such services are allocated
ratably to these companies.
Under a separate approved plan, the
Fund may expend up to .25% of its Class B net assets
annually to reimburse OFDI for costs incurred in
connection with the personal service and maintenance
of accounts that hold Class B shares of the Fund,
including amounts paid to brokers, dealers, banks and
other institutions. In addition, Class B shares are
subject to an asset-based sales charge of .75% of net
assets annually, to reimburse OFDI for sales
commissions paid from its own resources at the time
of sale and associated financing costs. In the event
of termination or discontinuance of the Class B plan,
the Board of Directors may allow the Fund to continue
payment of the asset-based sales charge to OFDI for
distribution expenses incurred on Class B shares sold
prior to termination or discontinuance of the plan.
During the year ended June 30, 1995, OFDI retained
$17,832 as reimbursement for Class B sales
commissions and service fee advances, as well as
financing costs.
15 Oppenheimer Main Street California Tax-Exempt Fund
<PAGE>
INDEPENDENT AUDITORS' REPORT
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The Board of Directors and Shareholders of
Oppenheimer Main Street California Tax-Exempt Fund:
We have audited the accompanying statement of assets
and liabilities, including the statement of
investments, of Oppenheimer Main Street California
Tax-Exempt Fund as of June 30, 1995, the related
statement of operations for the year then ended, the
statements of changes in net assets for the years
ended June 30, 1995 and 1994, and the financial
highlights for the period May 18, 1990 to June 30,
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.
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 June 30, 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, such financial
statements and financial highlights present fairly,
in all material respects, the financial position of
Oppenheimer Main Street California Tax-Exempt Fund at
June 30, 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
July 24, 1995
16 Oppenheimer Main Street California Tax-Exempt Fund
<PAGE>
FEDERAL INCOME TAX INFORMATION (Unaudited)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
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 June 30, 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.
17 Oppenheimer Main Street California Tax-Exempt Fund
<PAGE>
OPPENHEIMER MAIN STREET CALIFORNIA TAX-EXEMPT FUND
A Series of Oppenheimer Main Street Funds, 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
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
DISTRIBUTOR Oppenheimer Funds Distributor, Inc.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
TRANSFER AND SHAREHOLDER Oppenheimer Shareholder Services
SERVICING AGENT
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
CUSTODIAN OF The Bank of New York
PORTFOLIO SECURITIES
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
INDEPENDENT AUDITORS Deloitte & Touche LLP
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
LEGAL COUNSEL Myer, Swanson, Adams & Wolf, P.C.
This is a copy of a report to shareholders of
Oppenheimer Main Street California Tax-Exempt Fund.
This report must be preceded or accompanied by a
Prospectus of Oppenheimer Main Street California
Tax-Exempt Fund. For material information concerning
the Funds, see the Prospectus.
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.
18 Oppenheimer Main Street California Tax-Exempt Fund
<PAGE>
OPPENHEIMERFUNDS FAMILY
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
OppenheimerFunds offers over 30 funds designed to fit
virtually every investment goal. Whether you're
investing for retirement, your children's education
or tax-free income, we have the funds to help you
seek your objective.
When you invest with OppenheimerFunds, you can
feel comfortable knowing that you are investing with
a respected financial institution with over 30 years
of experience in helping people just like you reach
their financial goals. And you're investing with a
leader in global, growth stock and flexible fixed
income investments--with over 2.6 million shareholder
accounts and more than $35 billion under
Oppenheimer's management and that of our affiliates.
At OppenheimerFunds, we don't charge a fee to
exchange shares of eligible funds of the same class.
And you can exchange shares easily by mail or by
telephone.(1) For more information on
OppenheimerFunds, please contact your financial
advisor or call us at 1-800-525-7048 for a
prospectus. You may also write us at the address
shown on the back cover. As always, please read the
prospectus carefully before you invest.
<TABLE>
- --------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------
<S> <C> <C>
STOCK FUNDS Discovery Fund Global Fund
Global Emerging Growth Fund(2) Oppenheimer Fund
Target Fund Value Stock Fund
Growth Fund(3) Gold & Special Minerals Fund
- --------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------
STOCK & BOND FUNDS Main Street Income & Growth Fund Equity Income Fund
Total Return Fund Asset Allocation Fund
Global Growth & Income Fund
- --------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------
BOND FUNDS High Yield Fund Strategic Short-Term Income Fund
Champion High Yield Fund International Bond Fund
Strategic Income & Growth Fund Bond Fund(4)
Strategic Income Fund U.S. Government Trust
Strategic Investment Grade Bond Fund Limited-Term Government Fund
- --------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------
TAX-EXEMPT FUNDS New York Tax-Exempt Fund(5) New Jersey Tax-Exempt Fund(5)
California Tax-Exempt Fund(5) Tax-Free Bond Fund
Pennsylvania Tax-Exempt Fund(5) Insured Tax-Exempt Bond Fund
Florida Tax-Exempt Fund(5) Intermediate Tax-Exempt Bond Fund
- --------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------
MONEY MARKET FUNDS Money Market Fund Cash Reserves
<FN>
1. Exchange privileges are subject to change or
termination.
2. Formerly Global Bio-Tech Fund.
3. Formerly Special Fund.
4. Formerly Investment Grade Bond Fund.
5. Available only to residents of certain states.
OppenheimerFunds are distributed by Oppenheimer
Funds Distributor, Inc., Two World Trade Center,
New York, NY 10048-0203. -Copyright- Copyright 1995
Oppenheimer Management Corporation. All rights
reserved.
</TABLE>
19 Oppenheimer Main Street California Tax-Exempt Fund
<PAGE>
"HOW MAY I HELP YOU?"
As an OppenheimerFunds shareholder, you have some special privileges. Whether
it's automatic investment plans, informative newsletters and hotlines, or ready
account access, you can benefit from services designed to make investing
simple.
And when you need help, our Customer Service Representatives are only a
toll-free phone call away. They can provide information about your account and
handle administrative requests. You can reach them at our General Information
number.
When you want to make a transaction, you can do it easily by calling our
toll-free Telephone Transactions number. And, by enrolling in AccountLink, a
convenient service that "links" your OppenheimerFunds accounts and your bank
checking or savings account, you can use the Telephone Transactions number to
make investments.
For added convenience, you can get automated information with
OppenheimerFunds PhoneLink service, available 24 hours a day, 7 days a week.
PhoneLink gives you access to a variety of fund, account, and market
information. Of course, you can always speak with a Customer Service
Representative during the General Information hours shown at the left.
You can count on us whenever you need assistance. That's why the
International Customer Service Association, an independent, nonprofit
organization made up of over 3,200 customer service management professionals
from around the country, honored the OppenheimerFunds' transfer agent,
Oppenheimer Shareholder Services, with their Award of Excellence in 1993.
So call us today--we're here to help.
[Photo]
Jennifer Leonard, Customer Service Representative
Oppenheimer Shareholder Services
INFORMATION
GENERAL INFORMATION
Monday-Friday 8:30 a.m.-8 p.m. ET
Saturday 10 a.m.-2 p.m. ET
1-800-525-7048
TELEPHONE TRANSACTIONS
Monday-Friday 8:30 a.m.-8 p.m. ET
1-800-852-8457
PHONELINK
24 hours a day, automated information and transactions
1-800-533-3310
TELECOMMUNICATIONS DEVICE FOR THE DEAF (TDD)
Monday-Friday 8:30 a.m.-8 p.m. ET
1-800-843-4461
OPPENHEIMERFUNDS INFORMATION HOTLINE
24 hours a day, timely and insightful messages on the economy
and issues that affect your investments
1-800-835-3104
RA0725.001.0695 August 31, 1995
- -------------------------------------------------------------------------------
--------------
[Logo] Bulk Rate
U.S. Postage
Oppenheimer Funds Distributor, Inc. PAID
P.O. Box 5270 Permit No. 469
Denver, CO 80217-6270 Denver, CO
--------------
