SELIGMAN
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QUALITY
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MUNICIPAL
FUND, INC
[LOGO]
JWS
THIRD QUARTER
REPORT JULY 31, 1995
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TO THE STOCKHOLDERS
During the past three months, Seligman Quality Municipal Fund paid Common
Stockholders federally tax-free dividends of $0.0782 per share on May 24, June
26, and July 26, bringing total dividends to $0.2346 per share for the three
months. These payments translate to an annualized distribution rate of 6.76%,
based on the market price of $13.875 on July 31. This rate is equal to a taxable
yield of 11.19% based on the maximum federal income tax rate of 39.6%. Preferred
Stockholders were paid annualized dividends ranging from 3.847% to 4.55%.
Earnings on your Fund's assets in excess of the Preferred dividend requirement
constituted dividend income available for Common Stockholders.
Your Fund's net asset value was $14.95 per share at July 31, up from $14.65
on April 30, and $14.18 on January 31. Your Fund's market price was $13.875 per
share at July 31, up from $12.50 on April 30, and $12.625 on January 31.
For the three- and six-month periods ended July 31, total returns based on
net asset value were 3.83% and 9.17%, respectively, and based on market price
were 12.93% and 13.80%, respectively. (Total return reflects change in price,
net asset value or market as applicable, and assumes all distributions within
the period are reinvested in additional shares.)
Since we last reported, long-term municipal yields fluctuated within a
narrow range. At the end of July, the Bond-Buyer 20-Bond General Obligation
Index stood at 5.97%, just nine basis points below the Index on April 30.
Year-to-date, yields have declined by 74 basis points due to a strong first
quarter bond market rally.
On July 6, the Federal Reserve Board voted to lower the federal funds rate
in response to a slowing economy. Since then, however, economic reports have
been surprisingly robust in a number of sectors, prompting speculation that the
economy may not be as weak as previously thought. The shift in market sentiment
has resulted in higher interest rates across the yield curve, particularly in
the longer maturities.
Also impacting the municipal marketplace has been confusion surrounding the
various tax reform proposals being discussed. Investors have been demanding
higher yields on municipal securities to compensate for the perceived risk to
their tax-exempt status. While it is impossible to predict what the eventual
outcome of tax reform will be, the consensus is that the final legislation will
not be as detrimental to the municipal bond market as some fear.
Looking forward, the economy is expected to resume its slowdown. The
volatility that the fixed income markets have experienced should begin to
subside as investors become convinced that growth will remain moderate and that
the inflation rate is not at risk of accelerating again.
Should you need any additional information about your Fund, or your
investment in its shares, please write, or call using the toll-free telephone
numbers listed on page 3.
By order of the Board of Directors,
/s/ William C. Morris
William C. Morris
Chairman
/s/ Thomas G. Moles
Thomas G. Moles
President
August 25, 1995
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PORTFOLIO OF INVESTMENTS (unaudited)
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PERCENT OF NET
INVESTMENT FACE RATINGS
STATE ASSETS AMOUNT MUNICIPAL BONDS MOODY'S/S&P MARKET VALUE
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<S> <C> <C> <C> <C> <C>
ALASKA 3.5 $1,425,000 Alaska Housing Finance Corporation (Collateralized
Mortgage Obligation), 7.05% due 6/1/2025 ............ Aaa/AAA $ 1,475,901
2,175,000 Alaska Housing Finance Corporation (Collateralized
Veterans' Mortgage Program), 61/2% due 6/1/2034 ..... Aaa/AAA 2,183,026
CALIFORNIA 7.6 2,750,000 San Joaquin Hills Transportation Corridor Agency Rev.
(Senior Lien Toll Road), 63/4% due 1/1/2032 ......... NR/NR 2,746,040
5,000,000 University of California Regents Rev. (Multiple
Purpose Project), 63/8% due 9/1/2024 ................ Aaa/AAA 5,094,450
FLORIDA 3.3 3,000,000 Miami Health Facilities Authority Rev. (Mercy
Hospital Project), 63/4% due 8/1/2020 ............... Aaa/AAA 3,399,120
GEORGIA 2.9 3,000,000 Atlanta Airport Facilities Rev., 61/4% due 1/1/2021* . Aaa/AAA 3,015,660
HAWAII 1.8 1,750,000 Hawaii State Airports System Rev., 7% due 7/1/2020* .. Aaa/AAA 1,881,477
ILLINOIS 6.4 3,000,000 Cook County G.O.'s, 63/4% due 11/1/2018 .............. Aaa/AAA 3,393,540
3,000,000 Regional Transportation Authority G.O.'s,
6.70% due 11/1/2011 ................................. Aaa/AAA 3,184,740
KANSAS 3.2 3,000,000 Burlington Pollution Control Rev. (Kansas Gas and
Electric Company Project), 7% due 6/1/2031 .......... Aaa/AAA 3,285,030
LOUISIANA 3.1 1,000,000 Louisiana Public Facilities Authority Hospital Rev.
(Southern Baptist Hospitals Inc. Project),
8% due 5/15/2012 .................................... NR/AAA 1,161,950
2,000,000 Louisiana Public Facilities Authority Hospital Rev.
(Our Lady of Lourdes Regional Medical Center
Project), 6.45% due 2/1/2022 ........................ Aaa/AAA 2,042,680
MASSACHUSETTS 7.1 4,000,000 Massachusetts Health & Educational Facilities
Authority Rev. (New England Medical Center),
65/8% due 7/1/2025 .................................. Aaa/AAA 4,204,240
3,000,000 Massachusetts Housing Finance Agency Rev.
(Residential Development), 67/8% due 11/15/2021 ..... Aaa/AAA 3,120,780
MONTANA 5.5 2,220,000 Forsyth Pollution Control Rev. (Puget Sound
Power & Light Co.), 71/4% due 8/1/2021* ............. Aaa/AAA 2,418,557
3,000,000 Montana State Board of Investments Payroll Tax
Rev. (Workers' Compensation Program),
67/8% due 6/1/2020 .................................. Aaa/AAA 3,209,550
NEW HAMPSHIRE 4.5 5,000,000 New Hampshire Higher Educational & Health
Facilities Authority Rev. (Dartmouth College),
53/8% due 6/1/2023 .................................. Aaa/AA+ 4,617,150
NEW YORK 11.6 5,000,000 Metropolitan Transportation Authority Rev.
(Commuter Facilities), 61/4% due 7/1/2017 ........... Aaa/AAA 5,091,850
3,500,000 New York State Thruway Authority Rev.,
6% due 1/1/2025 ..................................... Aaa/AAA 3,475,815
$3,000,000 New York State Local Government Assistance
Corporation, 7% due 4/1/2021 ........................ Aaa/AAA 3,419,460
PENNSYLVANIA 4.6 2,500,000 Allegheny County Airport Rev. (Greater Pittsburgh
International Airport), 6.80% due 1/1/2010* ......... Aaa/AAA 2,689,125
2,000,000 Allegheny County Airport Rev. (Greater Pittsburgh
International Airport), 65/8% due 1/1/2022* ......... Aaa/AAA 2,051,000
RHODE ISLAND 3.3 3,000,000 Convention Center Authority of Rhode Island Rev.,
6.70% due 5/15/2020 ................................. Aaa/AAA 3,364,470
SOUTH CAROLINA 8.9 4,000,000 South Carolina Public Service Authority (Santee
Cooper), 61/2% due 7/1/2024 ......................... Aaa/AAA 4,483,840
4,500,000 South Carolina State Ports Authority Rev., 63/4% due
7/1/2021* ........................................... Aaa/AAA 4,707,000
TEXAS 4.9 3,000,000 Houston Water and Sewer System Rev., 61/2% due
12/1/2021 ........................................... Aaa/AAA 3,086,970
1,915,000 Texas State Veterans' Housing Assistance G.O.'s,
6.80% due 12/1/2023* ................................ Aa/AA 1,953,185
VIRGINIA 3.6 3,500,000 Virginia Housing Development Authority (Multi-
family Housing), 7% due 11/1/2012 ................... Aa/AA+ 3,676,750
WASHINGTON 5.1 860,000 Douglas County Public Utilities District #1
Hydroelectric Rev., 7.80% due 9/1/2018* ............. A/A+ 944,392
1,000,000 Municipality of Metropolitan Seattle Sewer Rev.,
6.60% due 1/1/2032 .................................. Aaa/AAA 1,036,020
3,000,000 Washington Public Power Supply System Rev.
(Nuclear Project #1), 7% due 7/1/2011 ............... Aaa/AAA 3,245,370
WISCONSIN 4.1 4,000,000 Wisconsin Housing & Economic Development
Authority Housing Rev., 6.85% due 11/1/2012 ......... Aaa/AAA 4,211,040
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TOTAL MUNICIPAL BONDS (COST $92,093,942) -- 95.0% ........................................... 97,870,178
SHORT-TERM HOLDINGS (COST $3,900,000) -- 3.8% ............................................... 3,900,000
OTHER ASSETS LESS LIABILITIES -- 1.2% ....................................................... 1,247,025
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NET INVESTMENT ASSETS-- 100.0% .............................................................. $103,017,203
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* Interest income earned from this security is subject to the federal
alternative minimum tax. Note: Investments in tax-exempt securities and other
short-term holdings maturing in more than 60 days are valued based upon
quotations provided by an independent pricing service or, in their absence, at
fair value determined in accordance with procedures approved by the Board of
Directors. Short-term holdings maturing in 60 days or less, are generally valued
at amortized cost.
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Important Telephone Numbers
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(800) 874-1092 STOCKHOLDER SERVICES o (800) 622-4597 24-HOUR AUTOMATED
TELEPHONE ACCESS SERVICE
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SELIGMAN QUALITY MUNICIPAL FUND, INC.
MANAGED BY
JWS
J. & W. SELIGMAN & CO.
INCORPORATED
INVESTMENT MANAGERS AND ADVISORS
ESTABLISHED 1864
100 PARK AVENUE, NEW YORK, NY 10017
CESQF3c 7/95
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