CMA CONNECTICUT
MUNICIPAL MONEY FUND
Semi-Annual Report
September 30, 1997
This report is not authorized for use as an offer of sale or a
solicitation of an offer to buy shares of the Fund unless accompanied
or preceded by the Fund's current prospectus. Past performance results
shown in this report should not be considered a representation of
future performance, which will fluctuate. The Fund seeks to maintain
a consistent $1.00 net asset value per share, although this cannot be
assured. An investment in the Fund is neither insured nor guaranteed
by the US Government. Statements and other information herein are as
dated and are subject to change.
CMA Connecticut
Municipal Money Fund
Box 9011
Princeton, NJ 08543-9011 #16055 -- 9/97
[RECYCLE LOGO]
Printed on post-consumer recycled paper
[FUND LOGO]
[MERRILL LYNCH BULL LOGO]
TO OUR SHAREHOLDERS:
For the six-month period ended September 30, 1997, CMA Connecticut
Municipal Money Fund paid shareholders a net annualized yield of
2.95%*. As of September 30, 1997, the Fund's 7-day yield was 3.15%.
Investment Outlook and Strategy
During the six months ended September 30, 1997, we maintained an
average portfolio maturity in the 55-day -- 70-day range. Our strategy
for the six-month period focused on several areas of holdings. First,
we repurchased $23 million in one-year mandatory put bonds with June
and July 1998 maturities, extending the Fund's average portfolio
maturity from the 55-day range to the 65-day range by the middle of
the period. Second, we made several purchases in the short-term
municipal note market, maintaining our holdings at approximately 20%
of net assets. Diversification remained one of our priorities, and
these purchases allowed us to increase the Fund's diversity while
providing high credit quality and an attractive yield. Finally, the
short-term municipal market experienced several periods of heightened
issuance, which strongly influenced the direction of short-term
municipal interest rates and our investment strategy. During these
periods, the yields on variable rate demand products moved to very
attractive levels as the market tried to absorb this additional
issuance. In light of this, we chose to reduce our commercial paper
holdings while increasing our holdings in the variable rate sector by
10% of net assets to seek to take advantage of the higher yields.
During the six-month period ended September 30, 1997, Connecticut
lawmakers approved several key pieces of legislation including a new
two-year budget and a $1.3 billion bond package. The $21.1 billion
budget included $400 million in tax cuts over the next two years.
Income, property and gasoline taxes are all to be reduced under the
agreement. The bond package authorized spending in several areas
including transportation, infrastructure and public transportation.
The state comptroller projects that the state will end fiscal year
1997 with a $255 million surplus in the general fund and a $110
million surplus in the transportation fund. In addition, despite
recently enacted tax cuts, personal income tax receipts were running
7.3% above the previous year's level. Finally, short-term municipal
issuance within the state of Connecticut increased to $355.4 million
from $113.7 million during the six-month period ended March 31, 1997.
Looking ahead, in the upcoming months we expect municipal supply to
once again influence short-term interest rates and our investment
strategy. Several issuers, including New York City and the states of
New Jersey and Pennsylvania, are expected to access the market. The
market's ability to digest this supply will be important in
determining the direction of interest rates. We also expect technical
factors associated with year-end broker/dealer inventory concerns and
January money inflows to affect the shape of the short-term yield
curve during this time.
In Conclusion
We appreciate your continued interest in CMA Connecticut Municipal
Money Fund, and we look forward to serving your investment needs in
the future.
Sincerely,
/S/ARTHUR ZEIKEL
Arthur Zeikel
President
/S/VINCENT R. GIORDANO
Vincent R. Giordano
Senior Vice President
/S/STEVEN T. LEWIS
Steven T. Lewis
Vice President and Portfolio Manager
October 24, 1997
* Based on a constant investment throughout the period, with dividends
compounded daily, and reflecting a net return to the investor after
all expenses.
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<CAPTION>
CMA CONNECTICUT MUNICIPAL MONEY FUND
SCHEDULE OF INVESTMENTS AS OF SEPTEMBER 30, 1997 (in Thousands)
Face Value
State Amount Issue (Note 1a)
<S> <C> <C> <C>
Connecticut -- $3,740 Avon, Connecticut, BAN, UT, 3.75% due 1/15/1998 $3,742
80.7% 4,735 Bethel, Connecticut, BAN, UT, 4% due 7/10/1998 4,742
25,350 Connecticut State Development Authority, Health Care Revenue Bonds
(Corporate Independent Living Project), VRDN, 4% due 7/01/2015 (a) 25,350
5,420 Connecticut State Development Authority, IDA (Sealectro Corporation
Project), 4.55% due 12/01/1997 5,420
Connecticut State Development Authority, PCR, Refunding, VRDN (a):
300 (Connecticut Light & Power Co. Project), AMT, Series B, 4% due 9/01/2028 300
21,450 (Connecticut Light & Power Co. Project), Series A, 4% due 9/01/2028 21,450
1,000 (United Illuminating Co. Project), 4% due 6/01/2026 1,000
18,100 (Western Massachusetts Electric Co.), Series A, 3.90% due 9/01/2028 18,100
8,000 Connecticut State Development Authority Revenue Bonds (Solid Waste
Project), VRDN, AMT, 3.70% due 8/01/2023 (a) 8,000
24,700 Connecticut State, GO, UT, VRDN, Series B, 4.05% due 5/15/2014 (a) 24,700
Connecticut State, HFA (Housing Mortgage Finance Program), AMT, CP,
Series D:
4,500 3.90% due 10/01/1997 4,500
3,445 3.70% due 10/08/1997 3,445
4,500 3.85% due 10/10/1997 4,500
4,505 3.75% due 10/23/1997 4,505
4,450 3.85% due 11/07/1997 4,450
Connecticut State Health and Educational Facilities Authority Revenue
Bonds:
1,000 (Sharon Hospital Issue), VRDN, Series A, 3.90% due 7/01/2027 (a) 1,000
2,815 (Yale-New Haven Hospital), Series E, 3.80% due 6/01/1998 (b) 2,815
2,500 (Yale University), CP, Series P, 3.55% due 10/06/1997 2,500
4,000 (Yale University), CP, Series P, 3.55% due 10/08/1997 4,000
3,500 (Yale University), CP, Series P, 3.55% due 10/09/1997 3,500
3,000 (Yale University), CP, Series P, 3.60% due 10/16/1997 3,000
3,300 (Yale University), CP, Series P, 3.55% due 11/12/1997 3,300
3,200 (Yale University), CP, Series P, 3.55% due 11/14/1997 3,200
3,500 (Yale University), CP, Series P, 3.60% due 11/19/1997 3,500
Connecticut State Municipal Electric Energy Cooperative, Power Supply
System Revenue Bonds, CP, Series A:
1,500 3.45% due 10/10/1997 1,500
1,500 3.40% due 10/14/1997 1,500
1,700 3.45% due 10/14/1997 1,700
1,500 3.50% due 10/28/1997 1,500
1,500 3.65% due 12/01/1997 1,500
Connecticut State Refunding (Economic Recovery Notes), UT:
1,000 5% due 12/15/1997 1,003
7,240 5% due 6/15/1998 7,301
Connecticut State Special Assessment Unemployment Compensation, Advanced
Fund Revenue Bonds:
19,900 (Connecticut Unemployment), Series C, 3.90% due 7/01/1998 (b) 19,900
1,600 Series A, 4.10% due 11/15/1997 (c) 1,601
13,700 Connecticut State Special Tax Obligation Revenue Bonds (Transportation
Infrastructure), VRDN, Second Lien, Series 1, 4.10% due 12/01/2010 (a) 13,700
3,790 Danbury, Connecticut, BAN, UT, 3.75% due 2/09/1998 3,792
8,000 Eagle Tax-Exempt Trust, Connecticut State, VRDN, Series 94, Class 071,
4.18% due 8/15/2012 (a) 8,000
East Haven, Connecticut, BAN, UT:
6,000 4.25% due 7/15/1998 6,019
1,500 4% due 9/01/1998 1,502
3,500 Hartford, Connecticut, Redevelopment Agency, M/F Mortgage Revenue
Refunding Bonds (Housing-Underwood Tower Project), VRDN, 3.80% due
6/01/2020 (a)(d) 3,500
7,900 New Britain, Connecticut, BAN, 3.95% due 4/14/1998 7,900
9,000 New Canaan, Connecticut, BAN, UT, 3.75% due 3/10/1998 9,012
2,500 Norwalk, Connecticut, BAN, UT, 4% due 7/15/1998 2,504
5,000 Stamford, Connecticut, BAN, UT, 4% due 4/01/1998 5,010
8,400 Stamford, Connecticut, Housing Authority Revenue Bonds (Morgan Street
Project), VRDN, AMT, 4.10% due 8/01/2024 (a) 8,400
12,200 Trumbull, Connecticut, BAN, UT, 3.75% due 1/21/1998 12,206
4,500 Westport, Connecticut, BAN, UT, Series A, 4% due 6/26/1998 4,510
3,000 Windsor Locks, Connecticut, GO, 3.75% due 10/15/1997 3,000
Puerto Rico -- Eagle Tax-Exempt Trust, VRDN (a):
18.2% 9,900 Puerto Rico Housing Finance Corp., 3.70% due 10/01/2011 9,900
7,200 Puerto Rico M/F Mortgage, Series C, 3.70% due 10/01/2011 7,200
Puerto Rico Commonwealth, Government Development Bank Revenue Bonds:
6,250 CP, 3.60% due 10/01/1997 6,250
6,250 CP, 3.75% due 12/04/1997 6,250
2,200 Refunding, VRDN, 3.70% due 12/01/2015 (a) 2,200
5,600 Puerto Rico Commonwealth, Highway and Transportation Authority, Highway
Revenue Bonds, VRDN, Series X, 3.70% due 7/01/1999 (a) 5,600
10,000 Puerto Rico Electric Power Authority, Power Revenue Bonds, VRDN, 3.90%
due 7/01/2022 (a)(e) 10,000
Puerto Rico Industrial, Medical and Environmental Pollution Control
Facilities Financing Authority Revenue Bonds:
1,850 3.80% due 9/01/1998 1,852
3,600 CP, 3.65% due 11/07/1997 3,600
3,200 CP, 3.75% due 11/07/1997 3,200
2,750 Series A, 3.75% due 12/01/1997 2,751
Puerto Rico Industrial, Tourist, Educational, Medical and Environmental
Control Facilities Financing Authority, Higher Education Revenue Bonds,
CP, Series A:
3,100 3.80% due 10/08/1997 3,100
3,100 3.95% due 10/10/1997 3,100
---------
Total Investments (Cost -- $352,582*) -- 98.9% 352,582
Other Assets Less Liabilities -- 1.1% 3,869
---------
Net Assets -- 100.0% $356,451
=========
(a) The interest rate is subject to change periodically based on certain indexes. The interest rate shown is the rate in
effect at September 30, 1997.
(b) FGIC Insured.
(c) AMBAC Insured.
(d) FSA Insured.
(e) MBIA Insured.
* Cost for Federal income tax purposes.
See Notes to Financial Statements.
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<TABLE>
<CAPTION>
Portfolio Abbreviations for CMA Connecticut Municipal Money Fund
<S> <C> <C> <C>
AMT Alternative Minimum Tax (subject to) IDA Industrial Development Authority
BAN Bond Anticipation Notes M/F Multi-Family
CP Commercial Paper PCR Pollution Control Revenue Bonds
GO General Obligation Bonds UT Unlimited Tax
HFA Housing Finance Agency VRDN Variable Rate Demand Notes
</TABLE>
<TABLE>
<CAPTION>
CMA CONNECTICUT MUNICIPAL MONEY FUND
STATEMENT OF ASSETS AND LIABILITIES AS OF SEPTEMBER 30, 1997
<S> <C> <C>
Assets:
Investments, at value (identified cost -- $352,581,844) (Note 1a) $352,581,844
Cash 487,348
Receivables:
Interest $2,195,799
Securities sold 1,500,986 3,696,785
-------------
Prepaid registration fees and other assets (Note 1d) 17,215
-------------
Total assets 356,783,192
-------------
Liabilities:
Payables:
Investment adviser (Note 2) 160,275
Distributor (Note 2) 82,121 242,396
-------------
Accrued expenses and other liabilities 90,051
-------------
Total liabilities 332,447
-------------
Net Assets $356,450,745
=============
Net Assets Consist of:
Shares of beneficial interest, $0.10 par value, unlimited number of shares authorized $35,662,818
Paid-in capital in excess of par 320,965,357
Accumulated realized capital losses -- net (Note 4) (177,430)
-------------
Net Assets -- Equivalent to $1.00 per share based on 356,628,175 shares of beneficial
interest outstanding $356,450,745
=============
See Notes to Financial Statements.
</TABLE>
<TABLE>
<CAPTION>
CMA CONNECTICUT MUNICIPAL MONEY FUND
STATEMENT OF OPERATIONS FOR THE SIX MONTHS ENDED SEPTEMBER 30, 1997
<S> <C> <C>
Investment Income (Note 1c):
Interest and amortization of premium and discount earned $6,133,608
Expenses:
Investment advisory fees (Note 2) $840,422
Distribution fees (Note 2) 207,221
Accounting services (Note 2) 30,086
Professional fees 27,056
Registration fees (Note 1d) 25,179
Transfer agent fees (Note 2) 23,505
Custodian fees 16,929
Printing and shareholder reports 8,006
Pricing fees 2,557
Trustees' fees and expenses 1,439
Other 2,107
-------------
Total expenses 1,184,507
-------------
Investment income -- net 4,949,101
Realized Loss on Investments -- Net (Note 1c) (35,947)
-------------
Net Increase in Net Assets Resulting from Operations $4,913,154
=============
See Notes to Financial Statements.
</TABLE>
<TABLE>
<CAPTION>
CMA CONNECTICUT MUNICIPAL MONEY FUND
STATEMENTS OF CHANGES IN NET ASSETS
For the Six For the
Months Ended Year Ended
Increase (Decrease) in Net Assets: Sept. 30, 1997 March 31, 1997
<S> <C> <C>
Operations:
Investment income -- net $4,949,101 $8,580,599
Realized loss on investments -- net (35,947) (7,261)
------------- -------------
Net increase in net assets resulting from operations 4,913,154 8,573,338
------------- -------------
Dividends to Shareholders (Note 1e):
Investment income -- net (4,949,101) (8,579,669)
------------- -------------
Net decrease in net assets resulting from dividends to shareholders (4,949,101) (8,579,669)
------------- -------------
Beneficial Interest Transactions (Note 3):
Net proceeds from sale of shares 679,831,647 1,090,795,423
Net asset value of shares issued to shareholders in reinvestment of dividends
(Note 1e) 4,949,152 8,579,691
------------- -------------
684,780,799 1,099,375,114
Cost of shares redeemed (668,224,856) (1,072,800,492)
------------- -------------
Net increase in net assets derived from beneficial interest transactions 16,555,943 26,574,622
------------- -------------
Net Assets:
Total increase in net assets 16,519,996 26,568,291
Beginning of period 339,930,749 313,362,458
------------- -------------
End of period $356,450,745 $339,930,749
============= =============
See Notes to Financial Statements.
</TABLE>
<TABLE>
<CAPTION>
CMA CONNECTICUT MUNICIPAL MONEY FUND
FINANCIAL HIGHLIGHTS
For the
The following per share data and ratios have been Six Months
derived from information provided in the financial Ended
statements. Sept. 30, For the Year Ended March 31,
1997 1997 1996 1995 1994
Increase (Decrease) in Net Asset Value:
<S> <C> <C> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of period $1.00 $1.00 $1.00 $1.00 $1.00
---------- ---------- ---------- ---------- ----------
Investment income -- net .01 .03 .03 .03 .02
---------- ---------- ---------- ---------- ----------
Total from investment operations .01 .03 .03 .03 .02
---------- ---------- ---------- ---------- ----------
Less dividends from investment income -- net (.01) (.03) (.03) (.03) (.02)
---------- ---------- ---------- ---------- ----------
Net asset value, end of period $1.00 $1.00 $1.00 $1.00 $1.00
========== ========== ========== ========== ==========
Total Investment Return 2.95%* 2.81% 3.01% 2.54% 1.77%
========== ========== ========== ========== ==========
Ratios to Average Net Assets:
Expenses .70%* .71% .72% .71% .70%
========== ========== ========== ========== ==========
Investment income -- net 2.95%* 2.76% 2.97% 2.53% 1.76%
========== ========== ========== ========== ==========
Supplemental Data:
Net assets, end of period (in thousands) $356,451 $339,931 $313,362 $260,398 $250,038
========== ========== ========== ========== ==========
* Annualized.
See Notes to Financial Statements.
</TABLE>
CMA CONNECTICUT MUNICIPAL MONEY FUND
NOTES TO FINANCIAL STATEMENTS
1. Significant Accounting Policies:
CMA Connecticut Municipal Money Fund (the "Fund") is part of CMA
Multi-State Municipal Series Trust (the "Trust"). The Fund is
registered under the Investment Company Act of 1940 as a non-
diversified, open-end management investment company. These unaudited
financial statements reflect all adjustments which are, in the opinion
of management, necessary to a fair statement of the results for the
interim period presented. All such adjustments are of a normal
recurring nature. The following is a summary of significant accounting
policies followed by the Fund.
(a) Valuation of investments -- Investments are valued at amortized
cost, which approximates market value. For the purpose of valuation,
the maturity of a variable rate demand instrument is deemed to be the
next coupon date on which the interest rate is to be adjusted. In the
case of a floating rate instrument, the remaining maturity is the
demand notice payment period.
(b) Income taxes -- It is the Fund's policy to comply with the
requirements of the Internal Revenue Code applicable to regulated
investment companies and to distribute substantially all of its
taxable income to its shareholders. Therefore, no Federal income tax
provision is required.
(c) Security transactions and investment income -- Security
transactions are recorded on the dates the transactions are entered
into (the trade dates). Interest income (including amortization of
premium and discount) is recognized on the accrual basis. Realized
gains and losses on security transactions are determined on the
identified cost basis.
(d) Prepaid registration fees -- Prepaid registration fees are charged
to expense as the related shares are issued.
(e) Dividends and distributions to shareholders -- The Fund declares
dividends daily and reinvests daily such dividends (net of non-
resident alien tax and back-up withholding tax withheld) in additional
fund shares at net asset value. Dividends are declared from the total
of net investment income, excluding discounts earned other than
original issue discounts. Net realized capital gains, if any, are
normally distributed annually after deducting prior years' loss
carryforward. The Fund may distribute capital gains more frequently
than annually in order to maintain the Fund's net asset value at $1.00
per share.
2. Investment Advisory Agreement and Transactions with Affiliates:
The Fund has entered into an Investment Advisory Agreement with Fund
Asset Management, L.P. ("FAM"). The general partner of FAM is
Princeton Services, Inc. ("PSI"), an indirect wholly-owned subsidiary
of Merrill Lynch & Co., Inc. ("ML & Co."), which is the limited
partner.
FAM is responsible for the management of the Fund's portfolio and
provides the necessary personnel, facilities, equipment and certain
other services necessary to the operations of the Fund. For such
services, the Fund pays a monthly fee based upon the average daily
value of the Fund's net assets, at the following annual rates: 0.50%
of the first $500 million of average daily net assets; 0.425% of
average daily net assets in excess of $500 million but not exceeding
$1 billion; and 0.375% of average daily net assets in excess of $1
billion.
Pursuant to the Distribution and Shareholder Servicing Plan in
compliance with Rule 12b-1 under the Investment Company Act of 1940,
Merrill Lynch, Pierce, Fenner & Smith Inc. ("MLPF&S") receives a
distribution fee from the Fund at the end of each month at the annual
rate of 0.125% of average daily net assets of the Fund. The
distribution fee is to compensate MLPF&S financial consultants and
other directly involved branch office personnel for selling shares of
the Fund and for providing direct personal services to shareholders.
The distribution fee is not compensation for the administrative and
operational services rendered to the Fund by MLPF&S in processing
share orders and administering shareholder accounts.
Merrill Lynch Financial Data Services, Inc. ("MLFDS"), a wholly-owned
subsidiary of ML & Co., is the Fund's transfer agent.
Accounting services are provided to the Fund by FAM at cost.
Certain officers and/or trustees of the Fund are officers and/or
directors of FAM, PSI, MLFDS, and/or ML & Co.
3. Shares of Beneficial Interest:
The number of shares purchased and redeemed during the period
corresponds to the amounts included in the Statements of Changes in
Net Assets for net proceeds from sale of shares and cost of shares
redeemed, respectively, since shares are recorded at $1.00 per share.
4. Capital Loss Carryforward:
At March 31, 1997, the Fund had a net capital loss carryforward of
approximately $138,000, of which $69,000 expires in 2000, $30,000
expires in 2001, $10,000 expires in 2002, $27,000 expires in 2003 and
$2,000 expires in 2005. This amount will be available to offset like
amounts of any future taxable gains.
Officers and Trustees
Arthur Zeikel -- President and Trustee
Ronald W. Forbes -- Trustee
Cynthia A. Montgomery -- Trustee
Charles C. Reilly -- Trustee
Kevin A. Ryan -- Trustee
Richard R. West -- Trustee
Terry K. Glenn -- Executive Vice President
Vincent R. Giordano -- Senior Vice President
Edward J. Andrews -- Vice President
Donald C. Burke -- Vice President
Peter J. Hayes -- Vice President
Kenneth A. Jacob -- Vice President
Steven T. Lewis -- Vice President
Darrin J. SanFillippo -- Vice President
Kevin A. Schiatta -- Vice President
Helen Marie Sheehan -- Vice President
Gerald M. Richard -- Treasurer
Robert Harris -- Secretary
Custodian
State Street Bank and Trust Company
P.O. Box 351
Boston, MA 02101
Transfer Agent
Merrill Lynch Financial Data Services, Inc.
4800 Deer Lake Drive East
Jacksonville, FL 32246-6484
(800) 221-7210*
* For inquiries regarding your CMA account, call (800) CMA-INFO
[(800) 262-4636].
