DREYFUS MASSACHUSETTS MUNICIPAL MONEY MARKET FUND
LETTER TO SHAREHOLDERS
Dear Shareholder:
We are pleased to report the performance for Dreyfus Massachusetts
Municipal Money Market Fund for its six-month period ended July 31, 1997.
Your Fund produced an annualized yield of 2.96%, and after taking into
account the effect of compounding, the annualized effective yield was 3.00%.*
THE ECONOMY
The latest government data continued to show the U.S. economy growing at
a somewhat decelerated pace, with real Gross Domestic Product (GDP) falling
to approximately 2.2% during the April-to-June quarter. In June, stronger
chain store activity was balanced by tumbling vehicle sales, while the big
three car makers sweetened sales incentive plans, signaling a belief that
demand will remain on the soft side through the summer. In fact, consumer
spending has been weak since the spring, expanding at just 0.8% in the second
quarter. Nonetheless, many economists expect growth to pick up again,
pointing to brisk capital outlays by businesses and a combination of low
interest rates, high consumer confidence, steady job gains, huge wealth
creation, and rising disposable income that should soon jump-start consumer
spending.
Meanwhile, the economy's strength continues to be complemented by a
virtual lack of inflation. With consumer prices rising just 1.4% during the
second quarter, inflation is running at its lowest pace in 34 years.
Moreover, U.S. producer prices fell a record seventh consecutive month in
July, and falling gold and oil prices have supported the view that inflation
is also moderate globally. As expected, the Federal Reserve Board's Open
Market Committee (FOMC) left interest rates alone at its July meeting, while
Fed Chairman Alan Greenspan all but ruled out a move to tighten monetary
policy anytime soon at his semi-annual testimony before the Senate on July
23. In the money market, short-term rates remained within a trading range as
market participants deemed a Fed move in August unlikely.
MARKET ENVIRONMENT/PORTFOLIO OVERVIEW
Each year, as summer approaches, the short-term municipal market
experiences volatility that is reflective of the changing patterns of supply
and demand conditions during the period. These market "technicals" require
adjustments to portfolio strategy in anticipation of conditions such as: an
increase in supply due to funds experiencing redemptions (April tax season);
a dearth of supply of high quality issues (end of June); and substantial new
money market issuance (mid-July financings). Our portfolio adjustments
attempt to structure your Fund to take advantage of these conditions in an
effort to enhance your Fund's return, while maintaining our commitment to
high quality holdings.
In response to the available supply of high quality Massachusetts-exempt
securities in April and May, we extended the average maturity of your Fund to
the 70-day range. We were able to take advantage of higher yields prevailing
at that time, representing levels more attractive than those found on similar
securities available for purchase in early summer. The Fund's average
maturity has recently shortened to the 50-day range and is therefore
well-positioned to extend as market conditions warrant. As we endeavor to
accomplish this, we will continue to commit to those Massachusetts issues
which meet our high quality investment guidelines and which provide the
appropriate level of liquidity for your Fund's needs. Additionally, we will
monitor those conditions which affect our marketplace and adjust our
investment policy where necessary to pursue competitive returns.
Included in this report is a series of detailed statements about your
Fund's holdings and its financial condition. We hope they are informative.
Please know that we appreciate greatly your continued confidence in the Fund
and in The Dreyfus Corporation.
Very truly yours,
[Richard J. Moynihan signature logo]
Richard J. Moynihan
Director, Municipal Portfolio Management
The Dreyfus Corporation
August 18, 1997
New York, N.Y.
*Annualized effective yield is based upon dividends declared daily and
reinvested monthly.
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<CAPTION>
DREYFUS MASSACHUSETTS MUNICIPAL MONEY MARKET FUND
STATEMENT OF INVESTMENTS JULY 31, 1997 (UNAUDITED)
Principal
Tax Exempt Investments-100.0% Amount Value
------- -------
Massachusetts-97.1%
<S> <C> <C>
Town of Ashland, BAN 4.04%, 3/5/98.......................................... $ 5,000,000 $ 5,002,528
Town of Easton, BAN 4.40%, 12/19/97......................................... 5,000,000 5,010,237
Fitchburg Industrial Development Financing Authority, Industrial Revenue,
VRDN
(Nestal Machinery Project)
3.60% (LOC; Lasalle National Bank) (a,b).................................. 3,500,000 3,500,000
Town of Hingham, BAN 4%, 12/19/97........................................... 4,000,000 4,007,504
Massachusetts Bay Transportation Authority:
General Transportation System Revenue
3.45%, Series 84A, 9/1/97 (LOC; State Street Bank) (b).................. 4,000,000 4,000,000
Notes:
4.75%, Series B, 9/5/97................................................. 5,000,000 5,003,687
4.25%, Series A, 2/27/98................................................ 4,000,000 4,011,939
Massachusetts Health and Education Facilities Authority, Revenue, VRDN:
(Capital Asset Program):
3.45%, Series C (Insured; MBIA and Liquidity; Credit Suisse) (a)........ 5,500,000 5,500,000
3.45%, Series D (Insured; MBIA and Liquidity; Credit Suisse) (a)........ 18,200,000 18,200,000
3.50%, Series E (LOC; First Chicago Corp.) (a,b)........................ 6,000,000 6,000,000
(Childrens Hospital) 3.45%, Series F (LOC; Sanwa Bank) (a,b).............. 2,285,000 2,285,000
(Harvard University) 3.50%, Series I (Guaranteed by; Harvard University) (a) 7,000,000 7,000,000
(Massachusetts Institute of Technology)
3.40%, Series G (Guaranteed by; Massachusetts Institute of Technology) (a) 5,000,000 5,000,000
(Wellesley College) 3.50%, Series B (Guaranteed by; Wellesley College) (a) 4,985,000 4,985,000
Massachusetts Housing Finance Agency, Refunding, VRDN:
(Harbor Point) 3.55%, Series A (LOC; Republic National Bank of New York) (a,b) 5,100,000 5,100,000
(Multi-Family Housing Project) 3.50%, Series A (LOC; FNMA) (a,b).......... 3,800,000 3,800,000
Massachusetts Industrial Finance Agency:
Housing Revenue 3.90%, Series 50, 6/1/98 (Insured; FGIC).................. 5,400,000 5,400,000
Industrial Revenue:
(Ocean Spray Cranberries Inc. Project) 3.85%, 10/15/97.................. 3,500,000 3,500,000
VRDN:
(Cambridge Isotope Labs Inc.) 3.20% (LOC; Fleet Bank) (a,b)........... 3,755,000 3,755,000
(First Healthcare Corp.) 3.70%, Series B (LOC; Wachovia Bank and Trust) (a,b) 1,295,000 1,295,000
Refunding (Cabot Newburyport Limited) 3.65% (LOC; Bank of Boston) (a,b) 1,500,000 1,500,000
PCR, CP, Refunding (New England Power Co. Project)
3.80%, Series A, 10/8/97 (Corp. Guaranty; New England Power Co.)........ 3,000,000 3,000,000
Revenue, VRDN:
(Edgewood Retirement Community) 3.60%, Series C (LOC; Dresdner Bank) (a,b) 2,600,000 2,600,000
(Godard House) 3.55% (LOC; Fleet Bank) (a,b)............................ 1,625,000 1,625,000
(Heritage at Dartmouth) 3.60% (LOC; Bank of Boston) (a,b)............... 1,825,000 1,825,000
(Newbury College) 3.65% (LOC; Baybank) (a,b)............................ 3,870,000 3,870,000
Refunding (Showa Womens Institute) 3.55% (LOC; Bank of America) (a,b)... 9,300,000 9,300,000
RRR, VRDN (Ogden Haverhill Project)
3.45%, Series B (LOC; Union Bank of Switzerland) (a,b).................. 5,500,000 5,500,000
DREYFUS MASSACHUSETTS MUNICIPAL MONEY MARKET FUND
STATEMENT OF INVESTMENTS (CONTINUED) JULY 31, 1997 (UNAUDITED)
Principal
Tax Exempt Investments (continued) Amount Value
------- -------
Massachusetts (continued)
Massachusetts Municipal Wholesale Electric Company, Power Supply Systems Revenue, VRDN
3.50%, Series C (LOC; Canadian Imperial Bank of Commerce) (a,b)........... $ 13,365,000 $ 13,365,000
Massachusetts Water Resource Authority, CP:
3.65%, 8/4/97 (LOC; Morgan Guaranty Trust Co.) (b)........................ 5,000,000 5,000,000
3.75%, 8/13/97 (LOC; Morgan Guaranty Trust Co.) (b)....................... 5,900,000 5,900,000
Town of New Bedford, BAN 4.25%, 10/10/97 (Repo Agreement; Fleet Bank)....... 2,700,000 2,701,739
Town of Rockport, BAN 4%, 2/19/98........................................... 5,875,000 5,885,955
Town of Springfield, BAN 4.40%, 6/26/98..................................... 2,500,000 2,509,739
U.S. Related-2.9%
Commonwealth of Puerto Rico, Government Development Bank, CP 3.70%, 8/11/97. 5,000,000 5,000,000
-------
TOTAL INVESTMENTS (cost $171,938,328)....................................... $171,938,328
=======
</TABLE>
Summary of Abbreviations
BAN Bond Anticipation Notes MBIA Municipal Bond Investors
CP Commercial Paper Assurance Insurance Corporation
FGIC Financial Guaranty Insurance Company PCR Pollution Control Revenue
FNMA Federal National Mortgage Association RRR Resources Recovery Revenue
LOC Letter of Credit VRDN Variable Rate Demand Notes
Summary of Combined Ratings
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<CAPTION>
<S> <C> <C> <C><C> <C>
Fitch (c) or Moody's or Standard & Poor's Percentage of Value
- -------- -------- ------------------ -------------------
F1+/F1 VMIG1/MIG1, P1 (d) SP1+/SP1, A1+/A1 (d) 77.1%
F2 VMIG2/MIG2, P2 SP2, A2 7.5
AAA/AA (e) Aaa/Aa (e) AAA/AA (e) .8
Not Rated (f) Not Rated (f) Not Rated (f) 14.6
----
100.0%
====
</TABLE>
Notes to Statement of Investments:
(a) Securities payable on demand. The interest rate, which is subject to
change, is based upon bank prime rates or and index of market interest
rates.
(b) Secured by letters of credit. At July 31, 1997, 46.3% of the Fund's
net assets are backed by letters of credit issued by domestic banks,
foreign banks and government agencies.
(c) Fitch currently provides creditworthiness information for a limited
number of investments.
(d) P1 and A1 are the highest ratings assigned tax exempt commercial
paper by Moody's and Standard & Poor's, respectively.
(e) Notes which are not F, MIG or SP rated are represented by bond
ratings of the issuers.
(f) Securities which, while not rated by Fitch, Moody's and Standard &
Poor's have been determined by the Manager to be of comparable quality to
those rated securities in which the Fund may invest.
SEE NOTES TO FINANCIAL STATEMENTS.
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<CAPTION>
DREYFUS MASSACHUSETTS MUNICIPAL MONEY MARKET FUND
STATEMENT OF ASSETS AND LIABILITIES JULY 31, 1997 (UNAUDITED)
Cost Value
<S> <C> <C> <C> <C>
-------- --------
ASSETS: Investments in securities-See Statement of Investments $171,938,328 $171,938,328
Cash....................................... 126,347
Interest receivable........................ 1,269,380
Prepaid expenses........................... 21,796
--------
173,355,851
--------
LIABILITIES: Due to The Dreyfus Corporation and affiliates 72,319
Accrued expenses........................... 37,374
--------
109,693
--------
NET ASSETS.................................................... $173,246,158
========
REPRESENTED BY: Paid-in capital............................ $173,280,622
Accumulated net realized gain (loss) on investments (34,464)
--------
NET ASSETS.................................................... $173,246,158
========
SHARES OUTSTANDING
(unlimited number of $.001 par value shares of Beneficial Interest
authorized) ........................................... 173,295,247
NET ASSET VALUE, offering and redemption price per share.................... $1.00
========
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
<TABLE>
<CAPTION>
DREYFUS MASSACHUSETTS MUNICIPAL MONEY MARKET FUND
STATEMENT OF OPERATIONS SIX MONTHS ENDED JULY 31, 1997 (UNAUDITED)
<S> <C>
INVESTMENT INCOME <C> <C> <C>
INCOME Interest Income................................ $3,184,366
EXPENSES: Management fee-Note 2(a)....................... $ 446,285
Shareholder servicing costs-Note 2(b).......... 68,869
Professional fees.............................. 26,158
Custodian fees................................. 9,600
Registration fees.............................. 8,983
Prospectus and shareholders' reports........... 6,420
Trustees' fees and expenses-Note 2(c).......... 4,453
Miscellaneous.................................. 3,870
------
Total Expenses................... 574,638
Less-reduction in management fee due to
undertaking-Note 2(a)........................... (23,495)
------
Net Expenses........................................... 551,143
------
INVESTMENT INCOME-NET....................................................... 2,633,223
NET REALIZED GAIN (LOSS) ON INVESTMENTS-Note 1(b)........................... (2,725)
------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS........................ $2,630,498
======
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
<TABLE>
<CAPTION>
DREYFUS MASSACHUSETTS MUNICIPAL MONEY MARKET FUND
STATEMENT OF CHANGES IN NET ASSETS
Six Months Ended
July 31, 1997 Year Ended
(Unaudited) January 31, 1997
--------- ---------
<S> <C> <C>
OPERATIONS:
Investment income-net.................................................... $ 2,633,223 $ 4,991,912
Net realized gain (loss) on investments.................................. (2,725) (309)
-------- --------
Net Increase (Decrease) in Net Assets Resulting from Operations........ 2,630,498 4,991,603
-------- --------
DIVIDENDS TO SHAREHOLDERS FROM:
Investment income-net.................................................... (2,633,223) (4,991,912)
-------- --------
BENEFICIAL INTEREST TRANSACTIONS ($1.00 per share):
Net proceeds from shares sold............................................ 155,170,567 323,425,448
Proceeds from acquisition of Dreyfus/Laurel Massachusetts Tax-Free Money
Fund,
Investor Shares........................................................ ---- 73,123,414
Dividends reinvested..................................................... 1,665,475 3,277,952
Cost of shares redeemed.................................................. (175,583,108) (362,885,184)
-------- --------
Increase (Decrease) in Net Assets from Beneficial Interest Transactions (18,747,066) 36,941,630
-------- --------
Total Increase (Decrease) in Net Assets.............................. (18,749,791) 36,941,321
NET ASSETS:
Beginning of Period...................................................... 191,995,949 155,054,628
-------- --------
End of Period............................................................ $ 173,246,158 $ 191,995,949
======== ========
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
DREYFUS MASSACHUSETTS MUNICIPAL MONEY MARKET FUND
FINANCIAL HIGHLIGHTS
Contained below is per share operating performance data for a share of
Beneficial Interest outstanding, total investment return, ratios to average
net assets and other supplemental data for each period indicated. This
information has been derived from the Fund's financial statements.
<TABLE>
<CAPTION>
Six Months Ended
July 31, 1997 Year Ended January 31,
----------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
PER SHARE DATA: (Unaudited) 1997 1996 1995 1994 1993
------------ ---- ---- ---- ---- ----
Net asset value, beginning of period.. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
---- ---- ---- ---- ---- ----
Investment Operations:
Investment income-net................. .015 .028 .033 .027 .021 .028
---- ---- ---- ---- ---- ----
Distributions:
Dividends from investment income-net.. (.015) (.028) (.033) (.027) (.021) (.028)
---- ---- ---- ---- ---- ----
Net asset value, end of period........ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
==== ==== ==== ==== ==== ====
TOTAL INVESTMENT RETURN................... 2.98%* 2.86% 3.34% 2.70% 2.12% 2.81%
RATIOS/SUPPLEMENTAL DATA:
Ratio of expenses to average net assets .62%* .60% .46% .28% .28% .19%
Ratio of net investment income
to average net assets............... 2.95%* 2.82% 3.28% 2.73% 2.09% 2.74%
Decrease reflected in above expense ratios
due to undertakings by the Manager.. .03%* .06% .19% .46% .53% .66%
Net Assets, end of period (000's Omitted) $173,246 $191,996 $155,055 $150,811 $87,864 $72,383
</TABLE>
* Annualized.
SEE NOTES TO FINANCIAL STATEMENTS.
DREYFUS MASSACHUSETTS MUNICIPAL MONEY MARKET FUND
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
NOTE 1-SIGNIFICANT ACCOUNTING POLICIES:
Dreyfus Massachusetts Municipal Money Market Fund (the "Fund") is
registered under the Investment Company Act of 1940 ("Act") as a
non-diversified open-end management investment company. The Fund's investment
objective is to provide investors with as high a level of current income
exempt from Federal and Massachusetts income taxes as is consistent with the
preservation of capital and the maintenance of liquidity. The Dreyfus
Corporation ("Manager") serves as the Fund's investment adviser. The Manager
is a direct subsidiary of Mellon Bank, N.A. Premier Mutual Fund Services,
Inc. is the distributor of the Fund's shares, which are sold to the public
without a sales charge.
It is the Fund's policy to maintain a continuous net asset value per
share of $1.00; the Fund has adopted certain investment, portfolio valuation
and dividend and distribution policies to enable it to do so. There is no
assurance, however, that the Fund will be able to maintain a stable net asset
value per share of $1.00.
The Fund's financial statements are prepared in accordance with generally
accepted accounting principles which may require the use of management
estimates and assumptions. Actual results could differ from those estimates.
(a) Portfolio valuation: Investments in securities are valued at
amortized cost, which has been determined by the Fund's Board of Trustees to
represent the fair value of the Fund's investments.
(b) Securities transactions and investment income: Securities
transactions are recorded on a trade date basis. Interest income, adjusted
for amortization of premiums and original issue discounts on investments, is
earned from settlement date and recognized on the accrual basis. Realized
gain and loss from securities transactions are recorded on the identified
cost basis. Cost of investments represents amortized cost.
The Fund follows an investment policy of investing primarily in municipal
obligations of one state. Economic changes affecting the state and certain of
its public bodies and municipalities may affect the ability of issuers within
the state to pay interest on, or repay principal of, municipal obligations
held by the Fund.
(c) Dividends to shareholders: It is the policy of the Fund to declare
dividends daily from investment income-net. Such dividends are paid monthly.
Dividends from net realized capital gain, if any, are normally declared and
paid annually, but the Fund may make distributions on a more frequent basis
to comply with the distribution requirements of the Internal Revenue Code. To
the extent that net realized capital gain can be offset by capital loss
carryovers, it is the policy of the Fund not to distribute such gain.
(d) Federal income taxes: It is the policy of the Fund to continue to
qualify as a regulated investment company, which can distribute tax exempt
dividends, by complying with the applicable provisions of the Internal
Revenue Code, and to make distributions of income and net realized capital
gain sufficient to relieve it from substantially all Federal income and
excise taxes.
The Fund has an unused capital loss carryover of approximately $31,700
available for Federal income tax purposes to be applied against future net
securities profits, if any, realized subsequent to January 31, 1997. If not
applied, $30,500 of the carryover expires in fiscal 2003, $1,000 expires in
fiscal 2004 and $200 expires in fiscal 2005.
At July 31, 1997, the cost of investments for Federal income tax purposes
was substantially the same as the cost for financial reporting purposes (see
the Statement of Investments).
NOTE 2-MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATES:
(a) Pursuant to a management agreement with the Manager, the management
fee is computed at the annual rate of .50 of 1% of the value of the Fund's
average daily net assets and is payable monthly. The Manager had undertaken
from February 1, 1996 through May 8, 1997 to reduce the management fee paid
by the Fund, to the extent that the Fund's
DREYFUS MASSACHUSETTS MUNICIPAL MONEY MARKET FUND
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
aggregate annual expenses (exclusive of taxes, brokerage, interest on
borrowings and extraordinary expenses) exceeded an annual rate of .60 of 1%
of the value of the Fund's average daily net assets. The reduction in
management fee, pursuant to the undertakings, amounted to $23,495 during the
period ended July 31, 1997.
(b) Under the Shareholder Services Plan, the Fund reimburses Dreyfus
Service Corporation, a wholly-owned subsidiary of the Manager, an amount not
to exceed an annual rate of .25 of 1% of the value of the Fund's average
daily net assets for certain allocated expenses of providing personal
services and/or maintaining shareholder accounts. The services provided may
include personal services relating to shareholder accounts, such as answering
shareholder inquiries regarding the Fund and providing reports and other
information, and services related to the maintenance of shareholder accounts.
During the period ended July 31, 1997, the Fund was charged an aggregate of
$30,032 pursuant to the Shareholder Services Plan.
The Fund compensates Dreyfus Transfer, Inc., a wholly-owned subsidiary of
the Manager, under a transfer agency agreement for providing personnel and
facilities to perform transfer agency service for the Fund. Such compensation
amounted to $26,116 during the period ended July 31, 1997.
(c) Each trustee who is not an "affiliated person" as defined in the Act
receives from the Fund an annual fee of $1,000. The Chairman of the Board
receives an additional 25% of such compensation.
Registration Mark
[Dreyfus lion "d" logo]
DREYFUS MASSACHUSETTS MUNICIPAL
MONEY MARKET FUND
200 Park Avenue
New York, NY 10166
MANAGER
The Dreyfus Corporation
200 Park Avenue
New York, NY 10166
CUSTODIAN
The Bank of New York
90 Washington Street
New York, NY 10286
TRANSFER AGENT &
DIVIDEND DISBURSING AGENT
Dreyfus Transfer, Inc.
P.O. Box 9671
Providence, RI 02940
Printed in U.S.A. 639SA977
Registration Mark
[Dreyfus logo]
Massachusetts
Municipal
Money Market Fund
Semi-Annual
Report
July 31, 1997
