LETTER TO SHAREHOLDERS
Dear Shareholder:
As your Fund ended its annual reporting period on September 30, 1994, the
net asset value was $8.98 per share. The Fund is currently producing an
annualized distribution rate per share of 5.78%, based on our most recent
dividend of $.047 per share and a closing market price of $8.125 on September
30, 1994. All dividends paid from net investment income during this period
were exempt from Federal and State of California income taxes.*
The municipal market continued its decline during this period as the
economy kept growing and inflationary fears increased. While some
acceleration in economic activity had been expected, the robust growth
experienced over the past several months was a surprise to most economists
and market participants alike. It had been anticipated that the higher
interest rates brought about by the Federal Reserve Board's tighter monetary
policy would slow economic expansion.
A wide array of economic indexes are showing growth at levels that have
forecasted inflationary trends in past recoveries. Consumer spending
rebounded in August as retail sales rose by almost a full percentage point.
Job gains remain strong, and jobless claims continue to decline. Capacity
utilization rates have risen rapidly and are now near the peak level of the
last cycle. Commodity prices continue on a volatile, but upward, path.
Overall, these data suggest that strong upward growth will continue into the
fourth quarter of this year, putting further pressure on the Federal Reserve
to tighten credit again before year-end.
Our strategy in this environment is cautionary. We believe that interest
rates will peak over the next several months and that inflation will continue
to be subdued. We currently maintain a relatively high average coupon in your
portfolio. This strategy seeks to provide a high current level of tax exempt
income and is generally considered to be defensive in a rising rate
environment.
The California economy has shown some improvement over the reporting
period, but continues to lag that of the national economy. The State's budget
difficulties are continuing, military base closings remain a major issue, and
immigration policies will come under increasing scrutiny over the next
several months. We are monitoring these situations very carefully to detect
their possible influence on the portfolio at an early stage.
We have included a current Statement of Investments and recent financial
statements for your review. We greatly appreciate your investment in the
Fund, and look forward to serving your investment needs in the future.
Very truly yours,
(Richard J. Moynihan Signature Logo)
Richard J. Moynihan
Director, Municipal Portfolio Management
The Dreyfus Corporation
October 18, 1994
New York, N.Y.
* Some income may be subject to the Federal Alternative Minimum Tax (AMT) for
certain shareholders.
<TABLE>
DREYFUS CALIFORNIA MUNICIPAL INCOME, INC.
SELECTED INFORMATION SEPTEMBER 30,1994 (UNAUDITED)
<S> <C> <C>
Market Price per share September 30, 1994........................... $8 1/8
Shares Outstanding September 30, 1994............................... 4,502,021
American Stock Exchange Ticker Symbol............................... DCM
</TABLE>
<TABLE>
MARKET PRICE (AMERICAN STOCK EXCHANGE)
FISCAL YEAR ENDED SEPTEMBER 30, 1994
----------------------------------------------------------------------------------------------------
QUARTER QUARTER QUARTER QUARTER
ENDED ENDED ENDED ENDED
DECEMBER 31, 1993 MARCH 31, 1994 JUNE 30, 1994 SEPTEMBER 30, 1994
--------------------- ----------------- --------------- ----------------------
<S> <C> <C> <C> <C>
High $10 1/2 $10 1/8 $ 9 3/8 $9
Low 9 3/8 8 1/2 8 8
Close 9 1/2 8 1/2 8 5/8 8 1/8
</TABLE>
<TABLE>
PERCENTAGE GAIN (LOSS) based on change in Market Price*
<S> <C> <C>
October 21, 1988 (commencement of operations) through September 30, 1994.............. 18.43%
October 1, 1993 through September 30, 1994............................................ (14.64)
January 1, 1994 through September 30, 1994............................................ (10.41)
April 1, 1994 through September 30, 1994.............................................. (1.34)
July 1, 1994 through September 30, 1994............................................... (4.24)
</TABLE>
<TABLE>
NET ASSET VALUE PER SHARE
<S> <C> <C>
October 21, 1988 (commencement of operations)........... $ 9.22
September 30, 1993...................................... 9.98
December 31, 1993....................................... 9.77
March 31, 1994.......................................... 9.13
June 30, 1994........................................... 9.07
September 30, 1994...................................... 8.98
</TABLE>
<TABLE>
PERCENTAGE GAIN (LOSS) based on change in Net Asset Value*
<S> <C> <C>
October 21, 1988 (commencement of operations) through September 30, 1994.......... 41.97%
October 1, 1993 through September 30, 1994........................................ (4.29)
January 1, 1994 through September 30, 1994........................................ (3.72)
April 1, 1994 through September 30, 1994.......................................... 1.52
July 1, 1994 through September 30, 1994........................................... .64
- ----------------------------
*With dividends reinvested.
</TABLE>
<TABLE>
DREYFUS CALIFORNIA MUNICIPAL INCOME, INC.
STATEMENT OF INVESTMENTS SEPTEMBER 30, 1994
PRINCIPAL
LONG-TERM MUNICIPAL INVESTMENTS--100.0% AMOUNT VALUE
------------ ------------
<S> <C> <C>
Anaheim Public Financing Authority, Tax Allocation Revenue
9.32%,12/28/2018 (Insured; MBIA) (a).................................... $ 2,000,000 $ 1,987,500
California Department of Water Resources, Revenue (Central Valley Project)
8.956%, 12/1/2026 (a,b)................................................. 900,000 851,625
California Educational Facilities Authority, Revenue (University of San
Francisco)
6.40%, 10/1/2017........................................................ 1,100,000 1,069,079
California Pollution Control Financing Authority, SWDR (Browning-Ferris
Industries)
6.75%, 9/1/2019......................................................... 600,000 585,138
California Public Works Board, LR:
(Department of Corrections-State Prison)
5.375%, 6/1/2012...................................................... 2,000,000 1,714,760
(Various University of California Projects):
Refunding 5.50%, 6/1/2021............................................. 1,000,000 838,710
6.60%, 12/1/2022 (Prerefunded 12/1/2002) (c).......................... 800,000 879,152
Capistrano Unified School District, Special Tax
(Community Facilities District Number 87-1-Aliso Viejo) 8.375%, 10/1/2020 2,000,000 2,172,100
Compton Community Redevelopment Agency, Tax Allocation Revenue,
Refunding (Walnut Industrial Park) 8.10%, 8/1/2013...................... 1,000,000 1,066,850
Costa Mesa City Hall and Public Safety Facilities, Inc. LR (Victoria State)
7.60%, 10/1/2018 (Prerefunded 10/1/1997) (c)............................ 1,000,000 1,078,010
Emeryville Public Financing Authority, Revenue (Shellmound Park Redevelopment
Project)
6.80%, 5/1/2014......................................................... 500,000 489,460
Fountain Valley Agency for Community Development, Tax Allocation Revenue
(City Center Area Redevelopment Project) 9.10%, 1/1/2015................ 2,500,000 2,662,225
City of Fresno, Health Facility Revenue, Refunding (Holy Cross Health System
Corp.)
5.625%, 12/1/2018....................................................... 750,000 640,170
City of Highland, Special Tax (Community Facilities District Number 90-1)
8.60%, 9/1/2015......................................................... 2,000,000 2,060,000
Irvine Ranch Water District Joint Powers Agency, Local Pool Revenue
8.25%, 8/15/2023........................................................ 1,000,000 1,052,560
Lake Elsinore Unified School District, Special Tax
(Community Facilities District Number 89-1) 7.85%, 10/1/2019............ 630,000 641,252
Los Angeles Department of Water and Power, Electric Plant Revenue
8.89%, 1/15/2033 (a,b).................................................. 1,500,000 1,258,125
Morgan Hill Redevelopment Agency, MFHR (La Crosse Village Project)
9.30%, 2/1/2027 (Insured; FHA).......................................... 1,000,000 1,018,120
Northern California Power Agency, Public Power Revenue, Refunding
(Hydroelectric Project No.1) 8%, 7/1/2013 (Prerefunded 7/1/1996) (c).... 865,000 934,010
Orange County, Special Tax:
(Community Facilities District Number 87-5-Rancho Santa Margarita)
7.80%, 8/15/2013...................................................... 1,000,000 1,117,710
(Community Facilities District Number 88-1-Aliso Viejo) 8.10%, 8/15/2013 1,000,000 1,128,940
Redwood Empire Financing Authority, COP 6.40%, 12/1/2023.................... 4,000,000 3,661,200
DREYFUS CALIFORNIA MUNICIPAL INCOME, INC.
STATEMENT OF INVESTMENTS (CONTINUED) SEPTEMBER 30, 1994
PRINCIPAL
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) AMOUNT VALUE
------------ ------------
Riverside County, Single Family Revenue 10.50%, 9/1/2014.................... $ 60,000 $ 60,423
Sacramento Municipal Utility District, Electric Revenue, Refunding
7.875%, 8/15/2016 (Prerefunded 8/15/1998) (c)........................... 1,500,000 1,685,025
San Joaquin Hills Transportation Corridor Agency, Toll Road Revenue
6.75%, 1/1/2032......................................................... 1,000,000 936,780
San Jose, MFHR 9.410%, 4/1/2002 (a)......................................... 3,000,000 2,917,500
Santa Cruz County Public Financing Authority, Tax Allocation Revenue
6.20%, 9/1/2023......................................................... 2,000,000 1,820,720
Santa Rosa, Water Revenue 7.60%, 9/1/2017 (Prerefunded 9/1/1995) (c)........ 1,000,000 1,050,200
Temecula Valley Unified School District, Special Tax
(Community Facilities District Number 89-3) 8%, 9/1/2019 (d)........... 2,000,000 1,100,000
University of California, Facilities Mortgage Revenue (Board of Regents)
9.125%, 7/1/2012........................................................ 50,000 51,911
Walnut Improvement Agency, Tax Allocation Revenue (Walnut Improvement
Project):
8%, 9/1/2018............................................................ 230,000 254,431
8%, 9/1/2018 (Prerefunded 9/1/1998) (c)................................. 1,000,000 1,130,040
------------
TOTAL INVESTMENTS
(cost $41,443,504)...................................................... $39,913,726
============
</TABLE>
<TABLE>
SUMMARY OF ABBREVIATIONS
<S> <C> <C> <C>
COP Certificate of Participation MBIA Municipal Bond Investors Assurance
FHA Federal Housing Administration MFHR Multi-Family Housing Revenue
LR Lease Revenue SWDR Solid Waste Disposal Revenue
</TABLE>
<TABLE>
SUMMARY OF COMBINED RATINGS (UNAUDITED)
FITCH(E) OR MOODY'S OR STANDARD & POOR'S PERCENTAGE OF VALUE
- -------- --------- -------------------- ----------------------
<S> <C> <C> <C>
AAA Aaa AAA 26.5%
AA Aa AA 6.9
A A A 19.4
BBB Baa BBB 27.1
Not Rated (f) Not Rated (f) Not Rated (f) 20.1
--------
100.0%
======
</TABLE>
NOTES TO STATEMENT OF INVESTMENTS:
(a) Residual interest security - the interest rate is subject to change
periodically.
(b) Security exempt from registration under Rule 144A of the Securities
Act of 1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers. At September
30, 1994, these securities amounted to $2,109,750 or 5.2% of net assets.
(c) Bonds which are prerefunded are collateralized with U.S. Government
securities which are held in escrow and are used to pay principal and
interest on the municipal issue and to retire the bonds in full at the
earliest refunding date.
(d) Non-income producing security; interest payment in default.
(e) Fitch currently provides creditworthiness information for a limited
number of investments.
(f) Securities which, while not rated by Fitch, Moody's or Standard &
Poor's, have been determined by the Fund's Board of Directors to be of
comparable quality to those rated securities in which the Fund may
invest.
See notes to financial statements.
<TABLE>
DREYFUS CALIFORNIA MUNICIPAL INCOME, INC.
STATEMENT OF ASSETS AND LIABILITIES SEPTEMBER 30, 1994
<S> <C> <C>
ASSETS:
Investments in securities, at value
(cost $41,443,504)--see statement..................................... $39,913,726
Interest receivable..................................................... 775,857
Prepaid expenses........................................................ 229
------------
40,689,812
LIABILITIES:
Due to The Dreyfus Corporation.......................................... $ 23,456
Due to Custodian........................................................ 165,577
Accrued expenses........................................................ 59,432 248,465
--------- ------------
NET ASSETS ................................................................ $40,441,347
============
REPRESENTED BY:
Paid-in capital......................................................... $41,617,951
Accumulated undistributed investment income_net......................... 136,625
Accumulated net realized gain on investments............................ 216,549
Accumulated net unrealized (depreciation) on investments_Note 3......... (1,529,778)
------------
NET ASSETS at value applicable to 4,502,021 shares outstanding
(110 million shares of $.001 par value Common Stock authorized)......... $40,441,347
============
NET ASSET VALUE, per share
($40,441,347 / 4,502,021 shares)........................................ $8.98
======
See notes to financial statements.
</TABLE>
<TABLE>
DREYFUS CALIFORNIA MUNICIPAL INCOME, INC.
STATEMENT OF OPERATIONS YEAR ENDED SEPTEMBER 30, 1994
<S> <C> <C>
INVESTMENT INCOME:
INTEREST INCOME......................................................... $ 2,963,145
EXPENSES:
Management fee--Note 2(a)............................................. $ 295,129
Auditing fees......................................................... 25,566
Shareholder servicing costs........................................... 25,517
Directors' fees and expenses_Note 2(b)................................ 23,961
Shareholders' reports................................................. 23,477
Legal fees............................................................ 12,048
Registration fees..................................................... 8,500
Custodian fees........................................................ 4,621
Miscellaneous......................................................... 9,739
-----------
TOTAL EXPENSES.................................................... 428,558
-----------
INVESTMENT INCOME--NET............................................ 2,534,587
REALIZED AND UNREALIZED (LOSS) ON INVESTMENTS:
Net realized gain on investments--Note 3................................ $ 271,986
Net unrealized (depreciation) on investments............................ (4,716,486)
-----------
NET REALIZED AND UNREALIZED (LOSS) ON INVESTMENTS................. (4,444,500)
-----------
NET (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS...................... $(1,909,913)
============
See notes to financial statements.
</TABLE>
<TABLE>
DREYFUS CALIFORNIA MUNICIPAL INCOME, INC.
STATEMENT OF CHANGES IN NET ASSETS
YEAR ENDED SEPTEMBER 30,
---------------------------------
1993 1994
------------- -------------
<S> <C> <C>
OPERATIONS:
Investment income--net.................................................. $ 2,770,540 $ 2,534,587
Net realized gain (loss) on investments................................. (53,203) 271,986
Net unrealized appreciation (depreciation) on investments for the year.. 2,563,023 (4,716,486)
------------- -------------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS....... 5,280,360 (1,909,913)
------------- -------------
DIVIDENDS TO SHAREHOLDERS FROM;
Investment income--net.................................................. (2,669,781) (2,586,125)
------------- -------------
CAPITAL STOCK TRANSACTIONS;
Dividends reinvested--Note 1(c)......................................... 321,645 278,969
------------- -------------
TOTAL INCREASE (DECREASE) IN NET ASSETS............................... 2,932,224 (4,217,069)
NET ASSETS:
Beginning of year....................................................... 41,726,192 44,658,416
------------- -------------
End of year (including undistributed investment income_net:
$718,484 in 1993 and $136,625 in 1994)................................ $44,658,416 $40,441,347
============ =============
SHARES SHARES
------------- -------------
CAPITAL SHARE TRANSACTIONS;
INCREASE IN SHARES OUTSTANDING AS A RESULT OF DIVIDENDS REINVESTED...... 33,015 29,327
============ =============
See notes to financial statements.
</TABLE>
<TABLE>
DREYFUS CALIFORNIA MUNICIPAL INCOME, INC.
FINANCIAL HIGHLIGHTS
Contained below is per share operating performance data for a share of
Common Stock outstanding, total investment return, ratios to average net
assets and other supplemental data for each year indicated. This information
has been derived from the financial statements and market price data for the
Fund's shares.
YEAR ENDED SEPTEMBER 30,
---------------------------------------------------------
PER SHARE DATA: 1990 1991 1992 1993 1994
------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of year.............. $ 9.38 $ 9.30 $ 9.22 $ 9.40 $ 9.98
------- ------- ------- ------- -------
INVESTMENT OPERATIONS:
Investment income--net.......................... .65 .65 .60 .62 .56
Net realized and unrealized gain (loss) on investments (.07) (.07) .18 .56 (.98)
------- ------- ------- ------- -------
TOTAL FROM INVESTMENT OPERATIONS.............. .58 .58 .78 1.18 (.42)
------- ------- ------- ------- -------
DISTRIBUTIONS:
Dividends from investment income--net........... (.64) (.63) (.60) (.60) (.58)
Dividends from net realized gain on investments. (.02) (.03) -- -- --
------- ------- ------- ------- -------
TOTAL DISTRIBUTIONS........................... (.66) (.66) (.60) (.60) (.58)
------- ------- ------- ------- -------
Net asset value, end of year.................... $ 9.30 $ 9.22 $ 9.40 $ 9.98 $ 8.98
======= ======= ======= ======= =======
Market Value, end of year....................... $ 9 3/8 $ 9 7/8 $ 9 3/8 $10 1/8 $ 8 1/8
======= ======= ======= ======= =======
TOTAL INVESTMENT RETURN* 4.48% 12.92% 1.23% 14.84% (14.64%)
RATIOS/SUPPLEMENTAL DATA:
Ratio of expenses to average net assets......... 1.00% 1.04% 1.11% 1.06% 1.02%
Ratio of net investment income to average net assets 6.97% 6.96% 6.48% 6.45% 6.01%
Portfolio Turnover Rate......................... 29.53% 15.43% 27.77% 15.54% 33.65%
Net Assets, end of year (000's Omitted)......... $40,509 $40,661 $41,726 $44,658 $40,441
- ----------------------------
* Calculated based on market value.
See notes to financial statements.
</TABLE>
DREYFUS CALIFORNIA MUNICIPAL INCOME, INC.
NOTES TO FINANCIAL STATEMENTS
NOTE 1--SIGNIFICANT ACCOUNTING POLICIES:
The Fund is registered under the Investment Company Act of 1940 ("Act")
as a non-diversified closed-end management investment company. The Dreyfus
Corporation ("Manager") serves as the Fund's investment adviser. Effective
August 24, 1994, the Manager became a direct subsidiary of Mellon Bank, N.A.
(A) PORTFOLIO VALUATION: Investments in municipal debt securities
(excluding options and financial futures on municipal and U.S. treasury
securities) are valued on the last business day of each week and month by an
independent pricing service ("Service") approved by the Board of Directors.
Investments for which quoted bid prices in the judgment of the Service are
readily available and are representative of the bid side of the market are
valued at the mean between the quoted bid prices (as obtained by the Service
from dealers in such securities) and asked prices (as calculated by the
Service based upon its evaluation of the market for such securities). Other
investments (which constitute a majority of the portfolio securities) are
carried at fair value as determined by the Service, based on methods which
include consideration of: yields or prices of municipal securities of
comparable quality, coupon, maturity and type; indications as to values from
dealers; and general market conditions. Options and financial futures on munic
ipal and U.S. treasury securities are valued at the last sales price on the
securities exchange on which such securities are primarily traded or at the
last sales price on the national securities market on the last business day
of each week and month. Investments not listed on an exchange or the national
securities market, or securities for which there were no transactions, are
valued at the average of the most recent bid and asked prices. Bid price is
used when no asked price is available.
(B) SECURITIES TRANSACTIONS AND INVESTMENT INCOME: Securities
transactions are recorded on a trade date basis. Realized gain and loss from
securities transactions are recorded on the identified cost basis. Interest
income adjusted for amortization of premiums and original issue discounts on
investments is earned from settlement date and recognized on the accrual
basis. Securities purchased or sold on a when-issued or delayed-delivery
basis may be settled a month or more after the trade date.
The Fund follows an investment policy of investing primarily in municipal
obligations of one state. Economic changes affecting the state and certain of
its public bodies and municipalities may affect the ability of issuers within
the state to pay interest on, or repay principal of, municipal obligations
held by the Fund.
(C) DIVIDENDS TO SHAREHOLDERS: Dividends are recorded on the ex-dividend
date. Dividends from investment income-net are declared and paid monthly.
Dividends from net realized capital gain are declared and paid at least
annually. To the extent that net realized capital gain can be offset by
capital loss carryovers, if any, it is the policy of the Fund not to
distribute such gain.
As a result of the treatment of premium amortization for financial
reporting purposes, versus Federal income tax purposes the Fund reclassified
$530,321 from undistributed net investment income to undistributed net
realized and unrealized gains (losses). This amount represented the
cumulative effect of such difference. Results of operations and net assets
were not effected by this reclassification.
For shareholders who elect to receive their distributions in additional
shares of the Fund, in lieu of cash, such distributions will be reinvested at
the lower of the market price or net asset value per share (but not less than
95% of the market price) as defined in the dividend reinvestment plan.
On September 29, 1994, the Board of Directors declared a cash dividend of
$.047 per share from investment income-net, payable on October 27, 1994 to
shareholders of record as of the close of business on October 13, 1994.
DREYFUS CALIFORNIA MUNICIPAL INCOME, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
(D) QUARTERLY RESULTS OF OPERATIONS (UNAUDITED):
<TABLE>
NET INCREASE
NET REALIZED & (DECREASE)
UNREALIZED GAIN IN NET ASSETS
TOTAL INVESTMENT NET INVESTMENT (LOSS) ON RESULTING FROM
INCOME INCOME INVESTMENTS OPERATIONS
---------------- ---------------- ---------------- ----------------
(000'S) PER (000'S) PER (000'S) PER (000'S) PER
QUARTER ENDED OMITTED SHARE OMITTED SHARE OMITTED SHARE OMITTED SHARE
- ------------- -------- ------ -------- ------ -------- ------ -------- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
December 31, 1992........... $ 813 $ 0.18 $ 701 $ 0.16 $ 116 $ 0.02 $ 817 $ 0.18
March 31, 1993.............. 802 0.18 699 0.15 1,389 0.31 2,088 0.47
June 30, 1993............... 810 0.18 698 0.15 424 0.10 1,122 0.25
September 30, 1993.......... 803 0.18 672 0.15 581 0.13 1,253 0.28
-------- ------ -------- ------ -------- ------ -------- ------
TOTAL................... $ 3,228 $ 0.72 $ 2,770 $ 0.61 $ 2,510 $ 0.56 $ 5,280 $ 1.18
======== ====== ======== ======= ======== ====== ======== ======
December 31, 1993........... $ 788 $ 0.18 $ 666 $ 0.15 $ (944) $(0.21) $ (278) $(0.06)
March 31, 1994.............. 758 0.17 651 0.14 (2,876) (0.64) (2,225) (0.50)
June 30, 1994............... 710 0.15 600 0.13 (241) (0.05) 359 0.08
September 30, 1994.......... 707 0.15 618 0.14 (384) (0.08) 234 0.06
-------- ------ -------- ------ -------- ------ -------- ------
TOTAL................... $ 2,963 $ 0.65 $ 2,535 $ 0.56 $ (4,445) $ (.98) $ (1,910) $(0.42)
======== ====== ======== ======= ======== ====== ======== ======
</TABLE>
(E) FEDERAL INCOME TAXES: It is the policy of the Fund to continue to
qualify as a regulated investment company, which can distribute tax exempt
dividends, by complying with the applicable provisions of the Internal
Revenue Code, and to make distributions of income and net realized capital
gain sufficient to relieve it from substantially all Federal income and
excise taxes.
NOTE 2--MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATES:
(A) Pursuant to a management agreement ("Agreement") with the Manager,
the management fee is computed at the annual rate of .70 of 1% of the average
weekly value of the Fund's net assets and is payable monthly. The Agreement
provides for an expense reimbursement from the Manager should the Fund's
aggregate expenses, exclusive of taxes, interest on borrowings, brokerage and
extraordinary expenses, exceed the expense limitation of any state having
jurisdiction over the Fund for any full fiscal year. There was no expense
reimbursement for the year ended September 30, 1994.
(B) Certain officers and directors of the Fund are "affiliated persons,"
as defined in the Act, of the Manager. Each director who is not an
"affiliated person" receives an annual fee of $2,500 and an attendance fee of
$250 per meeting.
NOTE 3--SECURITIES TRANSACTIONS:
The aggregate amount of purchases and sales of investment securities
amounted to $19,761,180 and $19,357,226, respectively, for the year ended
September 30, 1994, and consisted entirely of long-term and short-term
municipal investments.
At September 30, 1994, accumulated net unrealized depreciation on
investments was $1,529,778, consisting of $1,235,075 gross unrealized
appreciation and $2,764,854 gross unrealized depreciation.
At September 30, 1994, the cost of investments for Federal income tax
purposes was substantially the same as the cost for financial reporting
purposes (see the Statement of Investments).
DREYFUS CALIFORNIA MUNICIPAL INCOME, INC.
REPORT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
SHAREHOLDERS AND BOARD OF DIRECTORS
DREYFUS CALIFORNIA MUNICIPAL INCOME, INC.
We have audited the accompanying statement of assets and liabilities of
Dreyfus California Municipal Income, Inc., including the statement of
investments, as of September 30, 1994, and the related statement of
operations for the year then ended, the statement of changes in net assets
for each of the two years in the period then ended, and financial highlights
for each of the years indicated therein. These financial statements and
financial highlights are the responsibility of the Fund's management. Our
responsibility is to express an opinion on these financial statements and
financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements and
financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures
in the financial statements. Our procedures included confirmation of
securities owned as of September 30, 1994 by correspondence with the custodian.
An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights
referred to above present fairly, in all material respects, the financial
position of Dreyfus California Municipal Income, Inc. at September 30, 1994,
the results of its operations for the year then ended, the changes in its net
assets for each of the two years in the period then ended, and the financial
highlights for each of the indicated years, in conformity with generally
accepted accounting principles.
(Ernst & Young LLP Signature Logo)
New York, New York
November 4, 1994
DREYFUS CALIFORNIA MUNICIPAL INCOME, INC.
DIVIDEND REINVESTMENT PLAN (UNAUDITED)
The Fund generally distributes net investment income monthly. From and
after any issuance of Preferred Stock, monthly distributions to the holders
of the Common Stock (the "Common Shareholders") will consist of all net
investment income of the Fund remaining after payment of dividends on such
Preferred Stock. Any net realized short-term capital gains and any net
realized long-term capital gains will be distributed at least annually.
Net realized short- or long-term capital gains, if any, will be
distributed to Common Shareholders at least once a year to the extent not
necessary to pay dividends on or meet the liquidation preference of shares of
any Preferred Stock. While there are any shares of Preferred Stock
outstanding, the Fund may not declare any cash dividend or other distribution
on its Common Stock, unless at the time of such declaration, (i) all accrued
Preferred Stock dividends have been paid and (ii) the net asset value of the
Fund's portfolio (determined after deducting the amount of such dividend or
other distribution) is at least 200% of the liquidation value of the
outstanding Preferred Stock (expected to equal the original purchase price
per share plus any accrued and unpaid dividends thereon). This limitation on
the Fund's ability to make distributions on its Common Stock could under
certain circumstances impair the ability of the Fund to maintain its
qualification for taxation as a regulated investment company.
Under the Fund's Dividend Reinvestment Plan (the "Plan"), a Common
Shareholder who has Fund shares registered in his name will have all
dividends and distributions reinvested automatically by Mellon Bank, N.A., as
Plan agent (the "Agent"), in additional shares of the Fund at the lower of
prevailing market price or net asset value (but not less than 95% of market
value at the time of valuation) unless such shareholder elects to receive
cash as provided below. If market price is equal to or exceeds net asset
value, shares will be issued at net asset value. If net asset value exceeds
market price or if a cash dividend only is declared, the Agent, as agent for
the Plan participants, will buy Fund shares in the open market. A Plan
participant is not relieved of any income tax that may be payable on such
dividends or distributions.
A Common Shareholder who owns Fund shares registered in nominee name
through his broker/dealer (i.e., in "street name") may not participate in the
Plan, but may elect to have cash dividends and distributions reinvested by
his broker/dealer in additional shares of the Fund if such service is
provided by the broker/dealer; otherwise such dividends and distributions
will be treated like any other cash dividend or distribution.
A Common Shareholder who has Fund shares registered in his name may elect
to withdraw from the Plan at any time for a $5.00 fee and thereby elect to
receive cash in lieu of shares of the Fund. Changes in elections must be in
writing, sent to Mellon Bank, N.A., P.O. Box 750, Pittsburgh, Pennsylvania
15230, Attention: Dividend Reinvestment, should include the shareholder's
name and address as they appear on the Agent's records and will be effective
only if received more than ten business days prior to the record date for any
distribution.
The Agent maintains all shareholder accounts in the Plan and furnishes
written confirmations of all transactions in the account. Shares in the
account of each Plan participant will be held by the Agent in
non-certificated form in the name of the participant, and each such
participant's proxy will include those shares purchased pursuant to the Plan.
The Fund pays the Agent's fee for reinvestment of dividends and
distributions, Plan participants pay a pro rata share of brokerage
commissions incurred with respect to the Agent's open market purchases in
connection with the reinvestment of dividends or distributions.
The Fund reserves the right to amend or terminate the Plan as applied to
any dividend or distribution paid subsequent to notice of the change sent to
Plan participants at least 90 days before the record date for such dividend
or distribution. The Plan also may be amended or terminated by the Agent on
at least 90 days' written notice to Plan participants.
DREYFUS CALIFORNIA MUNICIPAL INCOME, INC.
CERTAIN MANAGEMENT POLICY INFORMATION (UNAUDITED)
On August 4, 1994, the Fund's shareholders voted to change certain of the
Fund's fundamental policies and investment restrictions to permit the Fund to
borrow money to the extent permitted under the Investment Company Act of
1940, as amended. However, the Fund currently anticipates to borrow money
only for temporary or emergency (not leveraging) purposes, in an amount up to
15% of the value of the Fund's total assets (including the amount borrowed)
valued at the lesser of cost or market, less liabilities (not including the
amount borrowed) at the time the borrowing is made. While such borrowings
exceed 5% of the Fund's assets, the Fund would not make any additional
investments.
DREYFUS CALIFORNIA MUNICIPAL INCOME, INC.
IMPORTANT TAX INFORMATION (UNAUDITED)
In accordance with Federal tax law, the Fund hereby designates all the
dividends paid from investment income-net during the fiscal year ended
September 30, 1994 as "exempt-interest dividends" (not subject to regular
Federal and, for individuals who are California residents, California
personal income taxes).
As required by Federal tax law rules, shareholders will receive
notification of their portion of the Fund's taxable ordinary dividends (if
any) and capital gain distributions (if any) paid for the 1994 calendar year
on Form 1099-DIV which will be mailed by January 31, 1995.
OFFICERS AND DIRECTORS
DREYFUS CALIFORNIA MUNICIPAL INCOME, INC.
144 Glenn Curtiss Boulevard
Uniondale, NY 11556
DIRECTORS
Lucy Wilson Benson
David W. Burke
Martin D. Fife
Whitney I. Gerard
Robert R. Glauber
Arthur A. Hartman
George L. Perry
Paul Wolfowitz
OFFICERS
President and
Chief Investment Officer
Richard J. Moynihan
Vice President-Financial
Jeffrey N. Nachman
Treasurer
John J. Pyburn
Secretary
Daniel C. Maclean III
Assistant Secretary
Christine Pavalos
Controller
Jean Farley
Vice Presidents and
Investment Officers:
Joseph P. Darcy
A. Paul Disdier
Karen M. Hand
Stephen C. Kris
Jill C. Shaffro
L. Lawrence Troutman
Samuel J. Weinstock
Monica S. Wieboldt
INVESTMENT ADVISER
The Dreyfus Corporation
CUSTODIAN
The Bank of New York
COUNSEL
Stroock & Stroock & Lavan
TRANSFER AGENT,
DIVIDEND DISTRIBUTION AGENT
AND REGISTRAR
Mellon Bank, N.A.
STOCK EXCHANGE LISTING
AMEX Symbol: DCM
INITIAL SEC EFFECTIVE DATE
10/21/88
The Net Asset Value appears in the
following publications: Barron's,
Closed-End Bond Funds section under
the heading "Municipal Bond Funds"
every Monday; Wall Street Journal,
Mutual Funds section under the
heading "Closed-End Bond Funds" every
Monday; New York Times, Business
section under the heading "Closed-End
Bond Funds" every Monday.
- ----------------------------------------------------------------------------
Notice is hereby given in accordance with Section 23(c) of the Investment
Company Act of 1940, as amended, that the Fund may purchase shares of its
common stock in the open market when it can do so at prices below the then
current net asset value per share.
- ----------------------------------------------------------------------------
Printed in U.S.A
857AR949
DREYFUS
CALIFORNIA
MUNICIPAL
INCOME, INC.
ANNUAL REPORT
SEPTEMBER 30, 1994
FPO Map
