FIDELITY
(REGISTERED TRADEMARK)
CALIFORNIA
MUNICIPAL
FUNDS
ANNUAL REPORT
FEBRUARY 28, 1997
CHECK PAGE NUMBERS !!!
CONTENTS
<TABLE>
<CAPTION>
<S> <C> <C>
PRESIDENT'S MESSAGE 3 NED JOHNSON ON INVESTING
STRATEGIES
FIDELITY CALIFORNIA MUNICIPAL INCOME FUND
4 PERFORMANCE
7 FUND TALK: THE MANAGER'S OVERVI
EW
10 INVESTMENT CHANGES
11 INVESTMENTS
23 FINANCIAL STATEMENTS
FIDELITY CALIFORNIA INSURED MUNICIPAL INCOME FUND
27 PERFORMANCE
30 FUND TALK: THE MANAGER'S OVERVI
EW
33 INVESTMENT CHANGES
34 INVESTMENTS
42 FINANCIAL STATEMENTS
FIDELITY CALIFORNIA MUNICIPAL MONEY MARKET FUND
46 PERFORMANCE
48 FUND TALK: THE MANAGER'S OVERVI
EW
50 INVESTMENT CHANGES
51 INVESTMENTS
62 FINANCIAL STATEMENTS
NOTES 66 NOTES TO THE FINANCIAL STATEMENTS
REPORT OF INDEPENDENT 71 THE AUDITORS' OPINION
ACCOUNTANTS
</TABLE>
To reduce expenses and demonstrate respect for our environment, we have
initiated a project through which we will begin eliminating duplicate
copies of most financial reports and prospectuses to most households, even
if they have more than one account in the fund. If additional copies of
financial reports, prospectuses or historical account information are
needed, please call 1-800-544-6666.
THIS REPORT AND THE FINANCIAL STATEMENTS CONTAINED HEREIN ARE SUBMITTED FOR
THE
GENERAL INFORMATION OF THE SHAREHOLDERS OF THE FUNDS. THIS REPORT IS NOT
AUTHORIZED FOR
DISTRIBUTION TO PROSPECTIVE INVESTORS IN THE FUNDS UNLESS PRECEDED OR
ACCOMPANIED BY
AN EFFECTIVE PROSPECTUS.
MUTUAL FUND SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED BY,
ANY DEPOSITORY INSTITUTION. SHARES ARE NOT INSURED BY THE FDIC, THE
FEDERAL RESERVE BOARD, OR ANY OTHER AGENCY, AND ARE SUBJECT TO
INVESTMENT RISKS, INCLUDING POSSIBLE LOSS OF PRINCIPAL AMOUNT INVESTED.
NEITHER THE FUNDS NOR FIDELITY DISTRIBUTORS CORPORATION IS A BANK.
FOR MORE INFORMATION ON ANY FIDELITY FUND, INCLUDING CHARGES AND EXPENSES,
CALL
1-800-544-8888 FOR A FREE PROSPECTUS. READ IT CAREFULLY BEFORE YOU INVEST
OR SEND
MONEY.
PRESIDENT'S MESSAGE
(PHOTO_OF_EDWARD_C_JOHNSON_3D)DEAR SHAREHOLDER:
As 1997 begins, the stock and bond markets generally have continued on the
course they followed during the past year. Through February, stocks
maintained their unprecedented climb, with the large companies still
setting the pace. With low, stable interest rates, the bond market has
tended to mirror its historical returns in the mid-single digits.
While it's impossible to predict the future direction of the markets with
any degree of certainty, there are certain basic principles that can help
investors plan for their future needs.
The longer your investment time frame, the more likely it is that you will
be affected by short-term market volatility. A 10-year investment horizon
appropriate for saving for a college education, for example, enables you to
weather market cycles in a long-term fund, which may have a higher risk
potential, but also has a higher potential rate of return.
An intermediate-length fund could make sense if your investment horizon is
two to four years, while a short-term bond fund could be the right choice
if you need your money in one or two years.
If your time horizon is less than a year, you might want to consider moving
some of your bond investment into a money market fund. These funds seek
income and a stable share price by investing in high-quality, short-term
investments. Of course, it's important to remember that there is no
assurance that a money market fund will achieve its goal of maintaining a
stable net asset value of $1.00 per share, and that these types of funds
are neither insured nor guaranteed by any agency of the U.S. government.
Finally, no matter what your time horizon or portfolio diversity, it makes
good sense to follow a regular investment plan, investing a certain amount
of money in a fund at the same time each month or quarter and periodically
reviewing your overall portfolio. By doing so, you won't get caught up in
the excitement of a rapidly rising market, nor will you buy all your shares
at market highs. While this strategy - known as dollar cost averaging -
won't assure a profit or protect you from a loss in a declining market, it
should help you lower the average cost of your purchases.
If you have questions, please call us at 1-800-544-8888. We are available
24 hours a day, seven days a week to provide you the information you need
to make the investments that are right for you.
Best regards,
Edward C. Johnson 3d
FIDELITY CALIFORNIA MUNICIPAL INCOME FUND
PERFORMANCE: THE BOTTOM LINE
There are several ways to evaluate a fund's historical performance. You can
look at the total percentage change in value, the average annual percentage
change, or the growth of a hypothetical $10,000 investment. Total return
reflects the change in the value of an investment, assuming reinvestment of
the fund's dividend income and capital gains (the profits earned upon the
sale of securities that have grown in value). You can also look at the
fund's income, as reflected in the fund's yield, to measure performance.
CUMULATIVE TOTAL RETURNS
<TABLE>
<CAPTION>
<S> <C> <C> <C>
PERIODS ENDED FEBRUARY 28, 1997 PAST 1 PAST 5 PAST 10
YEAR YEARS YEARS
Fidelity California Municipal Income 6.16% 40.91% 90.87%
Lehman Brothers California Municipal 5.49% n/a n/a
Bond Index
California Municipal Debt Funds Average 4.81% 39.94% 91.06%
</TABLE>
CUMULATIVE TOTAL RETURNS show the fund's performance in percentage terms
over a set period - in this case, one year, five years, or 10 years. For
example, if you invested $1,000 in a fund that had a 5% return over the
past year, the value of your investment would be $1,050. You can compare
the fund's returns to the performance of the Lehman Brothers California
Municipal Bond Index - a total return performance benchmark for California
investment-grade municipal bonds with maturities of at least one year. To
measure how the fund's performance stacked up against its peers, you can
compare it to the California municipal debt funds average, which reflects
the performance of 98 mutual funds with similar objectives tracked by
Lipper Analytical Services Inc. over the past one year. Both benchmarks
include reinvested dividends and capital gains, if any, and exclude the
effect of sales charges.
AVERAGE ANNUAL TOTAL RETURNS
<TABLE>
<CAPTION>
<S> <C> <C> <C>
PERIODS ENDED FEBRUARY 28, 1997 PAST 1 PAST 5 PAST 10
YEAR YEARS YEARS
Fidelity California Municipal Income 6.16% 7.10% 6.68%
Lehman Brothers California Municipal 5.49% n/a n/a
Bond Index
California Municipal Debt Funds Average 4.81% 6.94% 6.67%
</TABLE>
AVERAGE ANNUAL TOTAL RETURNS take the fund's cumulative return and show you
what would have happened if the fund had performed at a constant rate each
year. (Note: Lipper calculates average annual total returns by annualizing
each fund's total return, then taking an arithmetic average. This may
produce a slightly different figure than that obtained by averaging the
cumulative total returns and annualizing the result.)
$10,000 OVER 10 YEARS
IMAHDR PRASUN SHR__CHT 19970228 19970310 123027 S00000000000001
CA Muni Income LB Municipal Bond
00091 LB015
1987/02/28 10000.00 10000.00
1987/03/31 9928.89 9894.00
1987/04/30 9168.64 9397.52
1987/05/31 9030.60 9350.91
1987/06/30 9192.73 9625.45
1987/07/31 9297.32 9723.63
1987/08/31 9343.70 9745.51
1987/09/30 8839.66 9386.19
1987/10/31 8921.84 9419.42
1987/11/30 9133.43 9665.36
1987/12/31 9311.80 9805.60
1988/01/31 9756.04 10154.88
1988/02/29 9881.50 10262.22
1988/03/31 9562.47 10143.17
1988/04/30 9601.15 10220.26
1988/05/31 9640.37 10190.73
1988/06/30 9796.64 10339.82
1988/07/31 9854.18 10407.23
1988/08/31 9894.08 10416.39
1988/09/30 10109.48 10604.93
1988/10/31 10344.86 10791.57
1988/11/30 10226.16 10692.72
1988/12/31 10408.28 10802.11
1989/01/31 10553.08 11025.50
1989/02/28 10451.49 10899.70
1989/03/31 10436.14 10873.65
1989/04/30 10738.93 11131.79
1989/05/31 10966.42 11362.99
1989/06/30 11106.09 11517.30
1989/07/31 11206.73 11674.05
1989/08/31 11070.50 11559.76
1989/09/30 11084.77 11525.32
1989/10/31 11195.17 11666.27
1989/11/30 11369.23 11870.43
1989/12/31 11414.96 11967.53
1990/01/31 11335.13 11910.92
1990/02/28 11480.00 12016.93
1990/03/31 11505.39 12020.54
1990/04/30 11341.38 11933.51
1990/05/31 11613.96 12194.02
1990/06/30 11720.72 12301.20
1990/07/31 11901.84 12482.03
1990/08/31 11737.09 12300.79
1990/09/30 11783.67 12307.80
1990/10/31 11935.94 12531.07
1990/11/30 12163.21 12783.07
1990/12/31 12209.23 12838.67
1991/01/31 12320.09 13010.97
1991/02/28 12365.58 13124.16
1991/03/31 12379.13 13128.89
1991/04/30 12525.10 13303.50
1991/05/31 12649.53 13421.77
1991/06/30 12652.35 13408.48
1991/07/31 12811.84 13571.80
1991/08/31 12926.63 13750.54
1991/09/30 13065.19 13929.57
1991/10/31 13226.52 14054.94
1991/11/30 13228.49 14094.15
1991/12/31 13449.54 14396.61
1992/01/31 13521.98 14429.43
1992/02/29 13545.04 14434.05
1992/03/31 13537.66 14439.39
1992/04/30 13644.81 14567.90
1992/05/31 13814.63 14739.37
1992/06/30 14030.25 14986.69
1992/07/31 14464.75 15435.99
1992/08/31 14264.15 15285.49
1992/09/30 14336.93 15385.46
1992/10/31 14071.18 15234.22
1992/11/30 14399.42 15507.07
1992/12/31 14621.55 15665.39
1993/01/31 14796.09 15847.58
1993/02/28 15472.68 16420.79
1993/03/31 15289.18 16247.22
1993/04/30 15426.34 16411.15
1993/05/31 15516.13 16503.39
1993/06/30 15766.18 16778.83
1993/07/31 15766.16 16800.81
1993/08/31 16150.62 17150.60
1993/09/30 16354.82 17345.95
1993/10/31 16382.74 17379.42
1993/11/30 16213.59 17226.31
1993/12/31 16585.71 17589.96
1994/01/31 16773.43 17790.84
1994/02/28 16310.01 17330.05
1994/03/31 15475.95 16624.37
1994/04/30 15540.95 16765.35
1994/05/31 15647.95 16910.70
1994/06/30 15488.04 16807.38
1994/07/31 15803.70 17115.46
1994/08/31 15858.11 17174.68
1994/09/30 15614.79 16922.55
1994/10/31 15231.70 16622.01
1994/11/30 14857.60 16321.48
1994/12/31 15112.62 16680.72
1995/01/31 15654.16 17157.45
1995/02/28 16161.40 17656.39
1995/03/31 16327.39 17859.26
1995/04/30 16330.49 17880.34
1995/05/31 16878.67 18450.90
1995/06/30 16659.65 18290.38
1995/07/31 16811.99 18463.77
1995/08/31 17008.61 18697.89
1995/09/30 17160.04 18816.25
1995/10/31 17448.91 19089.84
1995/11/30 17795.94 19406.54
1995/12/31 18010.21 19593.03
1996/01/31 18119.84 19740.96
1996/02/29 17979.98 19607.71
1996/03/31 17705.43 19357.12
1996/04/30 17647.50 19302.34
1996/05/31 17634.86 19294.62
1996/06/30 17868.26 19504.74
1996/07/31 18042.50 19682.23
1996/08/31 18075.01 19677.51
1996/09/30 18325.21 19952.99
1996/10/31 18564.41 20178.66
1996/11/30 18960.59 20547.93
1996/12/31 18866.62 20461.63
1997/01/31 18900.42 20500.30
1997/02/28 19086.83 20688.50
IMATRL PRASUN SHR__CHT 19970228 19970310 123030 R00000000000123
$10,000 OVER 10 YEARS: Let's say hypothetically that $10,000 was invested
in Fidelity California Municipal Income Fund on February 28, 1987. As the
chart shows, by February 28, 1997, the value of the investment would have
grown to $19,087 - a 90.87% increase on the initial investment. For
comparison, look at how the Lehman Brothers Municipal Bond Index, which
reflects the performance of the investment-grade municipal bond market, did
over the same period. With dividends and capital gains, if any, reinvested,
the same $10,000 would have grown to $20,688 - a 106.88% increase.
UNDERSTANDING
PERFORMANCE
How a fund did yesterday is
no guarantee of how it will do
tomorrow. Bond prices, for
example, generally move in
the opposite direction of
interest rates. In turn, the
share price, return, and yield of
a fund that invests in bonds
will vary. That means if you
sell your shares during a
market downturn, you might
lose money. But if you can ride
out the market's ups and
downs, you may have a gain.
(checkmark)
TOTAL RETURN COMPONENTS
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
YEAR ENDED YEAR ENDED YEARS ENDED FEBRUARY 28,
FEBRUARY FEBRUARY
28, 29,
1997 1996 1995 1994 1993
Dividend returns 5.37% 5.86% 5.96% 5.82% 6.89%
Capital appreciation returns 0.79% 5.39% -6.87% -0.41% 7.34%
Total returns 6.16% 11.25% -0.91% 5.41% 14.23%
</TABLE>
TOTAL RETURN COMPONENTS include both dividend returns and capital
appreciation returns. A dividend return reflects the actual dividends paid
by the fund. A capital appreciation return reflects both the amount paid by
the fund to shareholders as capital gain distributions and changes in the
fund's share price. Both returns assume the dividends or capital gains paid
by the fund are reinvested.
DIVIDENDS AND YIELD
<TABLE>
<CAPTION>
<S> <C> <C> <C>
PERIODS ENDED FEBRUARY 28, 1997 PAST PAST 6 PAST 1
MONTH MONTHS YEAR
Dividends per share 4.58(cents) 29.72(cents) 60.18(cents)
Annualized dividend rate 5.05% 5.12% 5.20%
30-day annualized yield 4.67% - -
30-day annualized tax-equivalent yield 8.05% - -
</TABLE>
DIVIDENDS per share show the income paid by the fund for a set period. If
you annualize this number, based on an average share price of $11.82 over
the past one month, $11.70 over the past six months and $11.57 over the
past one year, you can compare the fund's income over these three periods.
Dividends per share show the income paid by the fund for a set period and
do not reflect any tax reclassifications. The 30-day annualized YIELD is a
standard formula for all funds based on the yields of the bonds in the
fund, averaged over the past 30 days. This figure shows you the yield
characteristics of the fund's investments at the end of the period. It also
helps you compare funds from different companies on an equal basis. The
tax-equivalent yield shows what you would have to earn on a taxable
investment to equal the fund's tax-free yield, if you're in the 41.95%
combined effective 1997 federal and state tax bracket but does not reflect
the payment of the federal alternative minimum tax, if applicable.
FIDELITY CALIFORNIA MUNICIPAL INCOME FUND
FUND TALK: THE MANAGER'S OVERVIEW
MARKET RECAP
Stable demand helped municipal
bonds perform better than their
investment-grade taxable
counterparts in the 12 months
ending February 28, 1997.
However, anticipation of short-term
interest rate increases by the
Federal Reserve Board negatively
affected all bonds. For the period,
the Lehman Brothers
Municipal Bond Index - a
broad measure of the municipal
bond market - had a total return of
5.51%. In comparison, the Lehman
Brothers Aggregate Bond Index -
a broad measure of the
performance of the U.S. taxable
bond market - returned 5.35%.
New issue supply in the municipal
market was strong through the
first half of the period, but
insurance companies and
individual investors helped sustain
demand. The diminishing
likelihood of significant tax reform
in the near future also helped
support the muni market. Like most
domestic bonds, munis were
affected by signs of strength in the
economy in the first half of 1996.
Nevertheless, the market
conditions that supported the muni
market helped it enter the fall
trading at expensive levels relative
to its taxable counterparts. Munis
stalled because their rich
valuations inhibited demand and
encouraged selling. From
December on, most bond markets
suffered from fears - confirmed by
Fed Chairman Alan Greenspan's
testimony before Congress in late
February - that latent inflation
pressures might encourage the
Fed to raise short-term rates.
Munis, however, outperformed
over the past few months, in part
because of a thin supply of new
issues.
(Portfolio Manager: Jonathan Short photograph)
An interview with Jonathan Short, Portfolio Manager of Fidelity California
Municipal Income Fund
Q. HOW DID THE FUND PERFORM, JON?
A. For the year ending February 28, 1997, the fund had a total return of
6.16%. For comparison purposes, the California municipal debt funds
average, as tracked by Lipper Analytical Services, returned 4.81%, and the
Lehman Brothers California Municipal Bond Index returned 5.49% for the same
one year period.
Q. WHAT TYPES OF BONDS DID WELL?
A. Baa-rated securities were some of the market's - and the fund's - best
performers and were a key reason why the fund fared better than many of its
competitors. The main driver for their strong returns was tightening credit
spreads - meaning lower-quality bonds' yields fell relative to
higher-quality bonds during the period. As a result, the prices of
lower-quality bonds generally performed better than higher-quality
securities. Toward the end of the period, I sold some of these Baa-rated
securities in order to lock in their gains. I would also point to
non-callable bonds, which can't be redeemed by their issuer prior to
maturity, as other winners during the past six months. When interest rates
fall, municipal issuers often call - or redeem - bonds before their
maturity and issue new bonds as a way to lower their interest costs.
Because the bond market experienced a small rally over the past six months,
non-callable bonds generally performed better than callable bonds.
Q. WHAT STRATEGIES DID YOU EMPLOY OVER THE PAST SIX MONTHS?
A. I focused on bonds with maturities in the intermediate range - those
with maturities of between five and 20 years - while keeping the fund's
holdings in shorter- and longer-term bonds light. I chose to emphasize
intermediate bonds because I believed that their expected total return was
greater than that of longer-maturity bonds. Additionally, I did not believe
that many longer-term securities offered enough additional yield to
compensate investors for their added interest rate sensitivity. All in all,
I felt that intermediate maturity bonds were attractive on a risk/return
basis.
Q. THERE HAS BEEN A LOT OF CONSOLIDATION IN THE HEALTH CARE SECTOR
RECENTLY. DID IT HAVE ANY EFFECT ON THE FUND?
A. Yes, it did. To the benefit of the fund, bonds issued by Sequoia
Hospital performed well when it was merged with Catholic Health Care West.
Additionally, our holdings in Eisenhower Hospital, issued by Rancho Mirage
Joint Powers Financing Authority, were advance refunded. With an advance
refunding, an issuer with existing bonds in the market will issue a second
set of bonds. Proceeds from this sale are then invested in high-quality
U.S. Treasury securities, and these Treasuries then secure the original
bonds until the call date.
Q. THE FUND'S STAKE IN GENERAL OBLIGATION BONDS (GOS) ISSUED BY THE STATE
HAS INCREASED OVER THE PAST SIX MONTHS. WHY WERE THESE SECURITIES
ATTRACTIVE?
A. GOs issued by the state are backed by its full faith and credit and are
repaid by general revenue, in contrast to revenue from a specific facility
or project built with borrowed funds. In my opinion the state's credit
worthiness has improved as its economy has rebounded. In fact, revenue
collections have improved to the point where estimates call for the state's
budget to post $1 billion more in revenues than originally projected.
Q. WHAT'S YOUR OUTLOOK?
A. From a supply and demand standpoint, I'm optimistic about municipals. I
don't expect to see a tremendous amount of new bonds issued. What increase
in supply we see likely will be easily digested if demand remains firm. How
municipals fare over the next year will depend heavily on the direction of
interest rates, but I don't think anyone can accurately pinpoint where
interest rates will be a year from now. That said, we may continue to see
some volatility in the bond market as long as there are conflicting signs
about the economy and inflation trends.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO MANAGER
ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON THE COVER.
THE MANAGER'S VIEWS ARE SUBJECT TO CHANGE AT ANY TIME BASED ON MARKET AND
OTHER CONDITIONS.
FUND FACTS
GOAL: high current tax-free
income for California
residents
FUND NUMBER: 091
TRADING SYMBOL: FCTFX
START DATE: July 7, 1984
SIZE: as of February 28, 1997,
more than $485 million
MANAGER: Jonathan Short,
since 1995; manager,
Spartan Florida Municipal
Income, since 1996; Fidelity
Advisor California Municipal
Income and Spartan
Arizona Municipal Income,
since 1995; Spartan
California Municipal Income,
Spartan California
Intermediate Municipal
Income, Fidelity California
Insured Municipal Income and
Fidelity Minnesota Municipal
Income, since 1995; joined
Fidelity in 1990
(checkmark)
JONATHAN SHORT ON
CALIFORNIA'S ECONOMY:
"The strength of California's
economic rebound is an
important component in the
overall performance of
California municipal bonds.
For a number of reasons, I am
optimistic about California's
economy. The first is
employment growth,
which continues to outpace
the nation as a whole.
Second, the state budget is
posting revenues well ahead
of projections, thanks mostly
to rising tax collections. Third,
the rebound has grown to be
more broad-based, with
Southern California finally
showing improvements after
lagging behind the northern
part of the state. Finally,
permits to build new houses
are up about 15% this year
and sales of existing homes
seem to have stabilized."
FIDELITY CALIFORNIA MUNICIPAL INCOME FUND
INVESTMENT CHANGES
TOP FIVE SECTORS AS OF FEBRUARY 28, 1997
% OF FUND'S % OF FUND'S INVESTMENT
INVESTMENTS S
IN THESE SECTORS
6 MONTHS AGO
General Obligation 30.3 26.5
Electric Revenue 15.0 13.4
Health Care 11.0 11.4
Special Tax 10.8 12.3
Water & Sewer 9.6 10.3
AVERAGE YEARS TO MATURITY AS OF FEBRUARY 28, 1997
6 MONTHS AGO
Years 14.6 15.2
AVERAGE YEARS TO MATURITY IS BASED ON THE AVERAGE TIME UNTIL PRINCIPAL
PAYMENTS ARE EXPECTED FROM EACH OF THE FUND'S BONDS, WEIGHTED BY DOLLAR
AMOUNT.
DURATION AS OF FEBRUARY 28, 1997
6 MONTHS AGO
Years 7.6 7.8
DURATION SHOWS HOW MUCH A BOND FUND'S PRICE FLUCTUATES WITH CHANGES IN
COMPARABLE INTEREST RATES. IF RATES RISE 1%, FOR EXAMPLE, A FUND WITH A
FIVE-YEAR DURATION IS LIKELY TO LOSE ABOUT 5% OF ITS VALUE. OTHER FACTORS
ALSO CAN INFLUENCE A BOND FUND'S PERFORMANCE AND SHARE PRICE. ACCORDINGLY,
A BOND FUND'S ACTUAL PERFORMANCE MAY DIFFER FROM THIS EXAMPLE.
QUALITY DIVERSIFICATION (MOODY'S RATINGS)
AS OF FEBRUARY 28, 1997 AS OF AUGUST 31, 1996
Aaa 38.9%
Aa, A 42.3%
Baa 12.3%
Caa 0.0%
Non-rated 3.9%
Short-term
investments 2.6%
Aaa 40.2%
Aa, A 39.3%
Baa 13.2%
Caa 0.0%
Non-rated 4.0%
Short-term
investments 3.3%
Row: 1, Col: 1, Value: 38.9
Row: 1, Col: 2, Value: 42.3
Row: 1, Col: 3, Value: 12.3
Row: 1, Col: 4, Value: 0.0
Row: 1, Col: 5, Value: 3.9
Row: 1, Col: 6, Value: 2.6
Row: 1, Col: 1, Value: 40.2
Row: 1, Col: 2, Value: 39.3
Row: 1, Col: 3, Value: 13.2
Row: 1, Col: 4, Value: 0.0
Row: 1, Col: 5, Value: 4.0
Row: 1, Col: 6, Value: 3.3
SHOWN AS A PERCENTAGE OF THE FUND'S INVESTMENTS. WHERE MOODY'S RATINGS ARE
NOT AVAILABLE, WE HAVE USED S&P RATINGS.
FIDELITY CALIFORNIA MUNICIPAL INCOME FUND
INVESTMENTS FEBRUARY 28, 1997
Showing Percentage of Total Value of Investments in Securities
MUNICIPAL BONDS - 97.4%
<TABLE>
<CAPTION>
<S> <C> <C> <C>
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (B) AMOUNT (NOTE 1)
CALIFORNIA - 97.4%
Alameda County Ctfs. of Prtn. Rfdg.
(Santa Rita Jail Proj.) 5.375% 6/1/09
(MBIA Insured) Aaa $ 4,100,000 $ 4,212,750
Alameda Hsg. Auth. Multi-Family Hsg. Rev.
(Independence Apts.) Series A, 7.50%
2/20/31 (GNMA Coll.) AAA 2,605,000 2,673,381
Buena Park Commty. Redev. Agcy. Tax
Allocation
Rfdg. (Central Business Dist. Proj.)
7.10% 9/1/14 BBB+ 2,000,000 2,117,500
Burbank Redev. Agcy. Tax Allocation
Series A,
5.75% 12/1/08 Baa1 2,300,000 2,337,375
California Dept. Wtr. Resources Rev.
(Central Valley Proj.) Series O,
4.75% 12/1/17 Aa 2,000,000 1,775,000
California Edl. Facs. Auth. Rev.:
Rfdg. (Chapman Univ.) 5.375% 10/1/16 AAA 1,000,000 962,500
Rfdg. (Univ. of Southern California)
Series A, 5.65%10/1/10 (f) Aa3 1,000,000 1,011,250
(Stanford Univ.) Series J, 6% 11/1/16 Aaa 1,955,000 2,011,206
California Gen. Oblig.:
Unltd. Tax 6.40% 2/1/05 A1 1,685,000 1,866,138
6.10% 11/1/01 A1 1,250,000 1,339,063
5.50% 6/1/03 A1 3,000,000 3,150,000
6% 9/1/03 A1 4,000,000 4,320,000
7% 10/1/04 A1 1,000,000 1,145,000
6.90% 4/1/05 A1 1,350,000 1,542,375
6.50 2/1/07 A1 1,000,000 1,123,750
6% 10/1/08 A1 1,500,000 1,633,125
4.75% 9/1/10 A1 1,400,000 1,330,000
6.50% 9/1/10 A1 2,400,000 2,706,000
7% 10/1/10 A1 1,000,000 1,176,250
5.25% 10/1/13 A1 1,700,000 1,661,750
5.25% 10/1/14 A1 3,000,000 2,913,750
6.25% 10/1/19 A1 4,200,000 4,593,750
California Health Facs. Fing. Auth. Rev.:
Rfdg. (Alexian Brothers, San Jose):
7.05% 1/1/09 (MBIA Insured) Aaa 4,500,000 4,854,375
7.125% 1/1/16 (MBIA Insured) Aaa 2,510,000 2,691,975
Rfdg. (Children's Hosp.) Series
A, 6% 7/1/05 (MBIA Insured) Aaa 1,850,000 2,004,938
(Gould Med. Foundation) Series A, 7.30%
4/1/20 (Escrowed to Maturity) (c) A 3,000,000 3,300,000
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (B) AMOUNT (NOTE 1)
CALIFORNIA - CONTINUED
California Health Facs. Fing. Auth. Rev.: - continued
(Kaiser Permanente Health Sys.):
Series A, 0% 10/1/09 Aa3 $ 7,140,000 $ 3,632,475
Series A, 0% 10/1/10 Aa3 3,795,000 1,807,369
(St. Elizabeth Hosp. Proj.) 6.30% 11/15/15
(Pre-Refunded to 11/15/02 @ 102) (c) A1 1,000,000 1,110,000
(Sacramento Med. Foundation) Series F,
7.875% 6/1/18 A 1,000,000 1,052,500
(Summit Medical Ctr.) Series A, 5.50%
5/1/05 (FSA Insured) Aaa 1,200,000 1,251,000
California Hsg. Fin. Agcy. Rev. (Home Mtg.):
Series A, 5% 8/1/03 (MBIA Insured) Aaa 1,995,000 2,004,975
Series F, 7.875% 8/1/19 Aa 725,000 749,469
California Industry Urban Ind. Dev. Agcy.:
Rfdg. (Civic Recreational Proj.#1) Series A,
7.375% 5/1/12 - 7,990,000 8,178,484
California Poll. Cont. Fing. Auth. Poll.
Cont. Rev.:
Rfdg. (San Diego Gas & Elec.) Series A,
5.90% 6/1/14 A2 2,000,000 2,097,500
(General Motors Corp.) 5.50% 4/1/08 A3 1,500,000 1,501,875
California Pub. Cap. Impt. Fing. Auth. Rev.
(Pooled Proj.) Series B, 8.10% 3/1/18
(MBIA Insured) Aaa 945,000 989,717
California Pub. Works. Board Lease Rev.:
Rfdg. (California Commty. Colleges)
Series D,
5.37% 3/1/12 A 1,500,000 1,481,250
Rfdg. (Commty. College Proj.) Series A,
5.875% 10/1/08 A 2,000,000 2,092,500
Rfdg. (Dept. Corrections State Prisons,
Monterey):
Series A, 5% 12/1/19 (AMBAC Insured) Aaa 3,250,000 3,030,625
Series D:
5.375% 11/1/11 A 1,500,000 1,483,125
5.375% 11/1/14 A 4,000,000 3,905,000
Rfdg. (Univ. of California Projs.) Series A:
5.40% 12/1/16 (AMBAC Insured) (f) Aaa 2,000,000 1,947,500
6.375% 10/1/19 A 1,250,000 1,334,375
(California Univ. Proj.):
Series A:
6.50% 9/1/03 A 1,045,000 1,141,663
5.50% 6/1/10 A1 1,915,000 1,953,300
5.50% 6/1/14 A1 10,775,000 10,707,656
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (B) AMOUNT (NOTE 1)
CALIFORNIA - CONTINUED
California Pub. Works. Board Lease Rev.: - continued
(California Univ. Proj.): - continued
Series B:
5.25% 6/1/07 A1 $ 2,965,000 $ 3,028,006
6.40% 12/1/09 A1 1,000,000 1,113,750
5.55% 6/6/10 A1 3,195,000 3,274,875
5.50% 6/1/14 A1 2,750,000 2,667,500
(Corcoran II) Series A, 6%1/1/05
(AMBAC Insured) Aaa 3,000,000 3,228,750
(Dept. Correction State Prisons, Susanville)
Series D, 5.25% 6/1/15 (FSA Insured) Aaa 2,000,000 1,950,000
(Madera State Prison) Series E:
5% 6/1/06 A1 1,730,000 1,745,138
6.30% 10/1/10 A 2,000,000 2,155,000
5.50% 6/1/15 A 1,750,000 1,747,813
5.50% 6/1/19 A 2,000,000 1,927,500
California Rural Home Mtg. Fin. 4.45% 8/1/01
(MBIA Insured) Aaa 2,500,000 2,481,250
California Statewide Commty. Dev. Corp.
Ctfs. of Prtn.:
Rfdg. (Insured Hosp.) (Triad Healthcare)
6.25% 8/1/06 A+ 2,000,000 2,097,500
(Children's Hosp.) 6% 6/1/13 (MBIA
Insured) Aaa 900,000 955,125
(Odd Fellows) 5.375% 10/1/13 A+ 2,500,000 2,390,625
(St. Joseph Health Sys.):
5.50% 7/1/14 Aa3 3,500,000 3,438,750
5.50% 7/1/23 Aa3 1,500,000 1,456,875
(Sisters of Charity Leavenworth) 5%
12/1/23 Aa3 5,375,000 4,857,656
(Villaview Commty. Hosp., Inc.) Series A,
7% 9/1/09 A 955,000 1,034,981
7.2628% 7/1/13 (MBIA Insured) INFL (h) Aaa 2,000,000 2,005,000
California Wtr. Resources 5.90% 12/1/05 Aa 1,005,000 1,086,656
Campbell Ctfs. of Prtn. Rfdg. (Civic Center
Proj.) 6% 10/1/18 A 2,400,000 2,400,000
Carson Redev. Agcy. Rfdg. Tax Allocation:
Area #1:
6.375% 10/1/12 Baa1 1,500,000 1,531,875
6.375% 10/1/16 Baa1 1,000,000 1,017,500
Area #2 6% 10/1/13 Baa 1,750,000 1,754,375
Castaic Lake Wtr. Agcy. Ctfs. of Prtn. Rfdg.
(Wtr. Sys. Impt. Proj.) Series A, 7% 8/1/13
(MBIA Insured) Aaa 1,580,000 1,868,350
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (B) AMOUNT (NOTE 1)
CALIFORNIA - CONTINUED
Central California Joint Pwrs. Health Fing.
Auth. Ctfs. of Prtn.Rfdg.
(Commty. Hosp. of Central California)
5.25% 2/2/04 Baa1 $ 2,000,000 $ 1,960,000
Central Coast Wtr. Auth. Rev. Rfdg.
(Regional Facs.)
Series A, 5% 10/1/16 (AMBAC Insured) Aaa 1,400,000 1,307,250
Central Valley Fing. Auth. Rev.
(Cogeneration Proj.)
(Carson Ice Gen. Proj.):
5.80% 7/1/04 BBB- 1,500,000 1,552,500
6% 7/1/09 BBB- 1,750,000 1,785,000
6.10% 7/1/13 BBB- 1,000,000 1,015,000
6.20% 7/1/20 BBB- 2,450,000 2,483,688
Contra Costa County Ctfs. of Prtn.
(Merrithew Mem. Hosp.):
Cap. Appreciation 0%, 11/1/13 A1 6,805,000 2,645,444
0% 11/1/07 A1 4,615,000 2,595,938
Contra Costa Trans. Auth. Sales Tax Rev.
Series A:
6% 3/1/04 (FGIC Insured) Aaa 1,000,000 1,085,000
6% 3/1/06 (FGIC Insured) Aaa 2,500,000 2,721,875
Culver City Redev. Fing. Auth. Rev. Rfdg.
Tax Allocation 4.60% 11/1/20
(AMBAC Insured) Aaa 1,500,000 1,265,625
Desert Hosp. Dist. Rev. Ctfs. of Prtn.
6.392% 7/28/20 (FSA Insured) Aaa 5,200,000 5,382,000
Duarte Ctfs. of Prtn. (City of Hope Nat'l.
Med. Ctr.):
6% 4/1/08 Baa1 2,000,000 2,022,500
6.25% 4/1/23 Baa1 3,000,000 3,026,250
East Bay Muni. Util. Dist. Wtr. Sys. Rev.
Sub. Rfdg.:
5.75% 6/1/04 (MBIA Insured) Aaa 4,000,000 4,275,000
6.10% 6/1/07 A1 1,250,000 1,335,938
6% 6/1/09 (AMBAC Insured) Aaa 1,000,000 1,056,250
East Bay Reg. Park Dist. Series C:
6.5% 9/1/02 (FGIC Insured) Aaa 1,220,000 1,342,000
6.50% 9/1/03 (FGIC Insured) Aaa 1,285,000 1,426,350
Eastern Muni. Wtr. Dist. Wtr. & Swr. Rev.
Ctfs. of Prtn. 6.75% 7/1/12 (FGIC Insured) Aaa 1,600,000 1,846,000
Elk Grove Unified School Dist. Spl. Tax Rfdg.
(Commty. Facs. Dist. #1) 6.50%
12/1/07 (AMBAC Insured) Aaa 840,000 953,400
Encintas Unified School Dist. (Cap.
Appreciation) 0% 8/1/04 (MBIA Insured) Aaa 1,250,000 868,750
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (B) AMOUNT (NOTE 1)
CALIFORNIA - CONTINUED
Fontana Redev. Agcy. Tax Allocation Rfdg.
(Jurupa Hills):
Series 1992 A, 7.10% 10/1/23 BBB $ 2,495,000 $ 2,610,394
Series A, 7% 10/1/14 BBB+ 2,300,000 2,420,750
Foothill/Eastern Trans. California Toll
Rd. Rev. Sr. Lien Series A, 0% 1/1/05 Baa 1,000,000 641,250
Foster City Pub. Fing. Auth. Rev.
(Foster City Commty. Rev. Proj.) Series A:
6% 9/1/06 A- 1,355,000 1,400,731
6% 9/1/07 A- 1,440,000 1,495,800
6% 9/1/13 A- 1,925,000 1,929,813
Fountain Valley Agcy. for Commty. Dev. Tax
Allocation:
(Civic Recreational Proj.#1-B)
7.375% 5/1/15 - 245,000 250,799
(Ind. Area Redev. Proj.)
9.10% 1/1/15 BBB+ 1,745,000 1,777,370
Intermodal Container Transfer Facs. Joint
Pwr. Auth.
Rev. Rfdg. Series 1989 A, 7.70% 11/1/14,
LOC Industrial Bank of Japan (BIG Insured) A1 1,500,000 1,567,500
Irvine Ranch Wtr. Dist. Joint Pwr. Agcy.
Local Pool Rev.:
7.875% 2/15/23 A+ 390,000 402,386
8.25% 8/15/23 A+ 13,175,000 13,883,156
Kern High School Dist. Gen. Oblig.
7% 8/1/09 (Escrowed to Maturity) (c) A 1,090,000 1,265,763
Kings River Conservation Dist. Rev. Rfdg.
(Pine Flat Pwr. Rev.) Series D,
6.375% 1/1/12 Aa 3,830,000 4,035,863
La Quinta Redev. Agcy. Rfdg. (Tax Allocation
Proj. Area #1) 7.30% 9/1/05 (MBIA Insured) Aaa 1,000,000 1,178,750
Livermore Redev. Agcy. Tax Allocation Rev.
(Livermore Redev. Proj.) Series A, 7.75%
8/1/09 - 1,000,000 1,018,550
Local Gov't. Fin. Auth. Rev. (Oakland
Central Dist.) 0% 9/1/08 Aaa 3,710,000 2,040,500
Los Angeles Ctfs. of Prtn. (Health Facs.
Construction Loan) (Bay Harbor Hosp.)
7.30% 4/1/20 A 2,000,000 2,127,500
Los Angeles County Ctfs. of Prtn.:
(Correctional Facs.) 0%, 9/1/10 (MBIA
Insured) (Escrowed to Maturity) (c) Aaa 3,770,000 1,819,025
(Disney Parking Proj.) (Cap. Appreciation):
0% 3/1/11 Baa1 1,950,000 799,500
0% 3/1/13 Baa1 2,835,000 1,009,969
0% 9/1/17 Baa1 3,370,000 876,200
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (B) AMOUNT (NOTE 1)
CALIFORNIA - CONTINUED
Los Angeles County Ctfs. of Prtn.: - continued
(Disney Parking Proj.) (Cap. Appreciation): - continued
0% 3/1/18 Baa1 $ 3,000,000 $ 753,750
0% 3/1/20 Baa1 1,000,000 220,000
Los Angeles County Metropolitan Trans. Auth.
Sales Tax Rev. Prop. C, Series A:
5.90% 7/1/03 (AMBAC Insured) Aaa 1,655,000 1,783,263
5.90% 7/1/04 (AMBAC Insured) Aaa 2,100,000 2,273,250
5.90% 7/1/07 (AMBAC Insured) Aaa 1,730,000 1,881,375
Los Angeles Hbr. Dept. Rev. 7.60% 10/1/18
(Escrowed to Maturity) (c) Aa 7,540,000 9,340,175
Los Angeles Wastewtr. Sys. Rev. Rfdg.:
Series A, 6% 2/1/04 (FGIC Insured) Aaa 1,500,000 1,616,250
Series D:
4.70% 11/1/17 (FGIC Insured) Aaa 2,000,000 1,742,500
5.20% 11/1/21 (FGIC Insured) Aaa 2,000,000 1,850,000
Madera County. Ctfs. Prtn. (Valley
Children's Hospital) 6.25% 3/15/05 (MBIA
Insured) Aaa 500,000 547,500
Metropolitan Wtr. Dist. Southern California
Rev.:
(Special Dist. G.O.s) 5% 3/1/02 Aaa 1,600,000 1,652,000
5.75% 8/12/18 Aa 5,000,000 5,018,750
5% 7/1/20 Aa 2,515,000 2,279,219
7.661% 8/5/22 INFL (h) Aa 1,300,000 1,332,500
Modesto Irrigation Dist. Ctfs. of Prtn.
Rfdg. & Cap. Impts. Series A:
0% 10/1/05 (MBIA Insured) Aaa 2,140,000 1,404,375
0% 10/1/08 (MBIA Insured) Aaa 2,270,000 1,242,825
(Geysers Geothermal Pwr. Proj.) Series
1986, 5% 10/1/17 A1 5,000,000 4,500,000
Northern California Pwr. Agcy. Pub. Pwr. Rev.:
Rfdg. (Geothermal Proj. #3-B) 5.50%
7/1/01 (AMBAC Insured) Aaa 1,500,000 1,567,500
Rfdg. (Geothermal Proj.) Series A, 5.80%
7/1/09 (AMBAC Insured) Aaa 1,875,000 1,992,188
Crossover Rfdg. (Geothermal Proj. #3)
Series A, 5.50% 7/1/05 (AMBAC Insured) (g) Aaa 2,250,000 2,370,938
7.50% 7/1/23 (AMBAC Insured)
(Pre-Refunded to 7/1/21 @ 100) (c) Aaa 1,355,000 1,681,894
Northern California Trans. Rev. (Ore Trans.
Proj.) Series A, 7% 5/1/13 (MBIA Insured) Aaa 7,000,000 8,303,750
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (B) AMOUNT (NOTE 1)
CALIFORNIA - CONTINUED
Oakland Ctfs. of Prtn. Rfdg. (Oakland
Museum) Series A, 0%, 4/1/07
(AMBAC Insured) Aaa $ 2,750,000 $ 1,653,438
Ontario Redev. Fing. Auth. Rev. (Cap.
Appreciation Proj. #1) (Ctr. City)
0% 8/1/10 (MBIA Insured) Aaa 3,255,000 1,578,675
Orange County Local Trans. Auth. Sales
Tax Rev. First Series-Measure M, 6%
2/15/08 (AMBAC Insured) Aaa 1,250,000 1,346,875
Placer County Wtr. Agcy. Rev. (Middle
Fork Proj.) Series A, 3.75% 7/1/12 A 8,830,000 7,450,313
Pleasanton Joint Pwrs. Fing. Auth. Rev.
Reassessment Series A:
5.70% 9/2/01 Baa 1,215,000 1,243,856
5.80% 9/2/02 Baa 2,820,000 2,901,075
6.15% 9/2/12 Baa 2,830,000 2,872,450
Port Oakland Port. Rev. Rfdg. (Cap.
Appreciation) Series F:
0% 11/1/06 (MBIA Insured) Aaa 1,640,000 1,010,650
0% 11/1/07 (MBIA Insured) Aaa 4,250,000 2,465,000
0% 11/1/08 (MBIA Insured) Aaa 1,770,000 964,650
Rancho Mirage Joint Pwrs. Fing. Auth.
Ctfs. of Prtn. (Eisenhower Mem. Hosp.)
7% 3/1/22 (Pre-Refunded to 3/1/02 @102) (c) A2 3,300,000 3,733,125
Rancho Wtr. Dist. Fing. Auth. Rev. Rfdg.
6.50% 11/1/04 (FGIC Insured) Aaa 1,985,000 2,215,756
Riverside County Asset Leasing Corp.
Leasehold Rev. (Riverside County Hosp.
Proj.) Series A, 6.50% 6/1/12 A 7,000,000 7,542,500
Riverside Unified School Dist. Ctfs. of Prtn.
(Cap. Appreciation Land Acquisition Proj.)
Series B, 0% 9/1/26 (FSA Insured) (d) Aaa 1,940,000 1,852,700
Sacramento Cogeneration Auth. Cogeneration
Proj. Rev. (Proctor & Gamble Proj.) :
5.40% 7/1/98 BBB- 1,000,000 1,011,250
5.90% 7/1/02 BBB- 1,000,000 1,037,500
6.375% 7/1/10 BBB- 700,000 729,750
6.50% 7/1/14 BBB- 1,000,000 1,043,750
Sacramento Fing. Auth. Lease Rev. Rfdg.
Series A, 5.375% 11/1/14 (AMBAC Insured) Aaa 2,225,000 2,213,875
Sacramento Muni. Util. Dist. Elec. Rev.:
Rfdg. Series G, 6.5% 9/1/13 Aaa 2,100,000 2,370,375
1.76% 11/15/08 (FGIC Insured) (e) Aaa 7,000,000 6,763,750
6.30% 8/15/18 (FGIC Insured) Aaa 3,500,000 3,648,750
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (B) AMOUNT (NOTE 1)
CALIFORNIA - CONTINUED
Sacramento Pwr. Auth. Cogeneration Proj. Rev.:
6.50% 7/1/06 BBB- $ 3,000,000 $ 3,221,250
6.50% 7/1/07 BBB- 1,000,000 1,067,500
San Bernardino County Ctfs. of Prtn.:
Rfdg. (Med. Ctr. Fin.) 5.50% 8/1/22 Baa1 5,500,000 5,204,375
(Cap. Facs. Proj.) Series B, 6.875%
8/1/24 (Escrowed to Maturity) (c) Baa1 2,500,000 2,959,375
San Diego County Reg'l. Trans. Commission
Sales Tax Rev. Second Series A:
6.25% 4/1/03 (FGIC Insured) Aaa 4,000,000 4,365,000
6% 4/1/04 (FGIC Insured) Aaa 2,875,000 3,112,188
San Diego County Wtr. Auth. Crtfs. of
Prtn. 5.632% 4/25/07 (FGIC Insured) Aaa 2,500,000 2,606,250
San Diego Multi-Family Hsg. Rev.
(Island Gardens Apts. Proj.) Series B
(GNMA Coll.) 9.50% 10/20/20, LOC Swiss
Bank AAA 1,585,000 1,603,608
San Diego Pub. Facs. Fing. Swr. 6% 5/15/07
(FGIC Insured) Aaa 1,500,000 1,623,750
San Diego Swr. Rev. Series A, 5% 5/15/13
(AMBAC Insured) Aaa 2,000,000 1,890,000
San Francisco Bay Area Rapid Transition
Dist. Sales Tax Rev. Rfdg. 6.75% 7/1/10
(AMBAC Insured) Aaa 1,500,000 1,734,375
San Francisco Bldg. Auth. Lease Rev.
(Dept. Gen. Svcs. Lease)
Series A, 5% 10/1/08 A 1,320,000 1,295,250
San Francisco City & County Gen. Oblig.:
Series 1995 A & B, 6.50% 6/15/03
(FGIC Insured) Aaa 1,500,000 1,651,875
7.20% 9/1/01 A1 625,000 647,369
San Francisco City & County Public Safety Impt.
Proj. Series B, 7.20% 6/15/05 A1 1,000,000 1,056,250
San Francisco City & County Redev. Agcy.
7.75% 9/1/06 - 9,000,000 9,315,810
San Francisco City & County Redev. Fing. Auth.
Tax Allocation Rev. Series A:
0% 8/1/06 (FGIC Insured) Aaa 1,035,000 652,050
0% 8/1/07 (FGIC Insured) Aaa 1,085,000 641,506
0% 8/1/08 (FGIC Insured) Aaa 1,085,000 602,175
0% 8/1/09 (FGIC Insured) Aaa 1,085,000 562,844
0% 8/1/10 (FGIC Insured) Aaa 1,085,000 526,225
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (B) AMOUNT (NOTE 1)
CALIFORNIA - CONTINUED
San Francisco City & County School Dist. Facs.
Impt. Proj. Series C, 6.20% 6/15/11
(FGIC Insured) Aaa $ 1,755,000 $ 1,851,525
San Francisco City & County Swr. Rev. Rfdg.
5.90% 10/1/08 (AMBAC Insured) Aaa 2,000,000 2,112,500
San Joaquin County Ctfs. of Prtn.
(General Hosp. Proj.) 5.70% 9/1/01 A 1,000,000 1,023,750
San Jose Ctfs. of Prtn. Rfdg.
(Communication Ctr. Proj.)
6.50% 5/1/10 (MBIA Insured) Aaa 3,500,000 3,766,875
Santa Ana Commty. Redev. Agcy. Tax
Allocation (Santa Ana Redev. Proj.)
Series B, 6.50 12/15/14 AAA 830,000 883,950
Santa Clara Elec. Rev. Series B,
0% 7/1/06 (MBIA Insured) Aaa 2,080,000 1,310,400
Santa Clara Fing. Lease Auth. Rev.
(VMC Fac. Replacement Proj.) Series A,
7.75% 11/15/09 (AMBAC Insured) Aaa 3,725,000 4,656,250
Santa Margarita Dana Point Auth. Rev.
(Impt. Dists. 1-2-2A 8, Series A:
7.25% 8/1/07 (MBIA Insured) Aaa 2,200,000 2,615,250
7.25% 8/1/12 (MBIA Insured) Aaa 1,865,000 2,251,988
Sequoia Hosp. Rev. Rfdg. 5.375% 8/15/13
(Escrowed to Maturity) (c) Baa 2,300,000 2,291,375
South Orange County Pub. Fin. Auth. Spl.
Tax Rev.:
(Foothill Area) Series C,
7.50% 8/15/06 (FGIC Insured) Aaa 2,000,000 2,412,500
(Sr. Lien) Series A, 7% 9/1/09 (MBIA
Insured) Aaa 3,000,000 3,532,500
Southern California Pub. Pwr. Auth. Pwr.
Proj. Rev.:
Rfdg. (Mead Adelanto Proj.) Series A,
4.75% 7/1/16 (AMBAC Insured) Aaa 2,000,000 1,775,000
Rfdg. (Palo Verde Proj.) Series A,
6% 7/1/07 (AMBAC Insured) Aaa 1,000,000 1,091,250
(Multiple Proj.):
6.75% 7/1/10 A 1,400,000 1,578,500
6.75% 7/1/11 A 4,000,000 4,495,000
Southern California Pub. Pwr. Auth.
Transmission
Proj. Rev. Rfdg. (Sub Southern Transmission)
Series A, 6% 7/1/06 (MBIA Insured) Aaa 1,000,000 1,092,500
Stanislaus County Ctfs. of Prtn. 5.25%
5/1/14 (MBIA Insured) Aaa 1,500,000 1,455,000
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (B) AMOUNT (NOTE 1)
CALIFORNIA - CONTINUED
Sulphur Springs Unified School Dist.
Series A:
0% 9/1/07 (MBIA Insured) Aaa $ 4,445,000 $ 2,578,100
0% 9/1/09 (MBIA Insured) Aaa 2,485,000 1,267,350
Univ. of California Rev. (Multiple Purpose
Projs.) Series D, 6.10% 9/1/10 (MBIA
Insured) Aaa 2,000,000 2,107,500
Upland Hosp. Ctfs. of Prtn.
(San Antonio Commty. Hosp.):
5.25% 1/1/08 A 1,850,000 1,801,438
5.25% 1/1/13 A 5,500,000 5,073,750
5% 1/1/18 A 1,500,000 1,312,500
West Covina Ctfs. of Prtn. (Queen of the
Valley Hosp.) 6 50% 8/15/24 A2 1,100,000 1,142,616
TOTAL MUNICIPAL BONDS
(Cost $444,307,087) 470,446,193
MUNICIPAL NOTES (A) - 2.6%
CALIFORNIA - 2.6%
California Gen. Oblig. RAN 4.50% 6/30/97 MIG 1 2,000,000 2,005,880
California Poll. Cont. Fin. Auth.
Poll. Cont. Rev.:
Rfdg. (Pacific Gas & Elec.) Series C,
3.40%, LOC Bank of America, VRDN A-1+ 2,300,000 2,300,000
(Southern California Edison Proj.)
Series 1986 C, 3.50%, VRDN VMIG 1 3,500,000 3,500,000
California Poll. Cont. Fing. Auth.
Resource Recovery Rev. (Ultra Pwr.
Rocklin Proj.) Series 1988 A, 3.45%,
LOC Security Pacific Nat'l. Bank, VRDN (i) P-1 1,900,000 1,900,000
Fresno County Unltd. TRAN 4.75% 9/29/97 SP-1+ 2,000,000 2,012,520
Los Angeles Gen. Oblig. TRAN,
Series 1996-1997, 4.50% 6/30/97
LOC Bank of Amer. Nat'l Trust & Savings MIG 1 1,000,000 1,002,950
TOTAL MUNICIPAL NOTES
(Cost $12,721,350) 12,721,350
TOTAL INVESTMENTS - 100%
(Cost $457,028,437) $483,167,543
FUTURES CONTRACTS
EXPIRATION UNDERLYING FACE UNREALIZED
DATE AMOUNT AT VALUE GAIN/(LOSS)
PURCHASED
52 Municipal Bond Contracts June 1997 $ 5,939,375 $ (15,097)
25 30-Year Treasury Bond Contracts June 1997 2,760,938 (2,570)
$ (17,667)
</TABLE>
THE FACE VALUE OF FUTURES PURCHASED AS A PERCENTAGE OF TOTAL INVESTMENT IN
SECURITIES - 1.8%
SECURITY TYPE ABBREVIATIONS
INFL - Inverse Floating Rate Security
RAN - Revenue Anticipation Notes
TRAN - Tax and Revenue Anticipation Notes
VRDN - Variable Rate Demand Notes
LEGEND
(a) The coupon rate shown on floating or adjustable rate securities
represents the rate at period end.
(b) Standard & Poor's Corporation credit ratings are used in the absence of
a rating by Moody's Investors Service, Inc.
(c) Security collateralized by an amount sufficient to pay interest and
principal.
(d) Debt obligation initially issued in zero coupon form which converts to
coupon form at a specified rate and date.
(e) Debt obligation initially issued at one coupon which converts to a
higher coupon at a specified date.
(f) Security purchased on a delayed delivery basis (see Note 2 of Notes to
Financial Statements).
(g) A portion of the security was pledged to cover margin requirements for
futures contracts. At the period end, the value of securities pledged
amounted to $368,813.
(h) Coupon is inversely indexed to a floating interest rate. The price will
be more volatile that the price of a comparable fixed rate security. The
rate shown is the rate at period end.
(i) Private activity obligations whose interest is subject to the federal
alternative minimum tax for individuals.
OTHER INFORMATION
The composition of long-term debt holdings as a percentage of total value
of investment in securities, is as follows (ratings are unaudited):
MOODY'S RATINGS S&P RATINGS
Aaa, Aa, A 70.3% AAA, AA, A 81.9%
Baa 7.3% BBB 7.2%
Ba 0.0% BB 0.0%
B 0.0% B 0.0%
Caa 0.0% CCC 0.0%
Ca, C 0.0% CC, C 0.0%
D 0.0%
The percentage not rated by either S&P or Moody's amounted to 3.9%. FMR has
determine that unrated debt securities that are lower quality account for
0.0% of the total value of investment in securities.
The distribution of municipal securities by revenue source, as a percentage
of total value of investment in securities, is as follows:
General Obligation 30.3%
Electric Revenue 15.0
Health Care 11.0
Special Tax 10.8
Water & Sewer 9.6
Lease Revenue 8.5
Escrowed/Pre-refunded 7.0
Others (individually less than 5%) 7.8
TOTAL 100.0%
INCOME TAX INFORMATION
At February 28, 1997, the aggregate cost of investment securities for
income tax purposes was $457,028,437. Net unrealized appreci-
ation aggregated $26,139,106, of which $27,208,729 related to appreciated
investment securities and $1,069,623 related to depreciated investment
securities.
At February 28, 1997, the fund had a capital loss carryforward of
approximately $4,627,000 which will expire on February 29, 2004.
At February 28, 1997, the fund was required to defer approximately
$3,496,000 of losses on futures contracts.
During fiscal year ended 1997, 100% (unaudited) of the fund's income
dividends was free from federal income tax, and .20% (unaudited) of the
fund's income dividends was subject to the federal alternative minimum tax.
FIDELITY CALIFORNIA MUNICIPAL INCOME FUND
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
<S> <C> <C>
FEBRUARY 28, 1997
ASSETS
Investment in securities, at value (cost $457,028,437) - $ 483,167,543
See accompanying schedule
Cash 19,881
Interest receivable 6,922,366
Receivable for daily variation on futures contracts 6,313
TOTAL ASSETS 490,116,103
LIABILITIES
Payable for investments purchased
Delayed Delivery $ 2,989,189
Payable for fund shares redeemed 429,103
Distributions payable 538,831
Accrued management fee 158,637
Other payables and accrued expenses 102,428
TOTAL LIABILITIES 4,218,188
NET ASSETS $ 485,897,915
Net Assets consist of:
Paid in capital $ 467,933,886
Accumulated undistributed net realized gain (loss) (8,157,410)
on investments
Net unrealized appreciation (depreciation) on 26,121,439
investments
NET ASSETS, for 41,148,631 shares outstanding $ 485,897,915
NET ASSET VALUE, offering price and redemption price per $11.81
share ($485,897,915 (divided by) 41,148,631 shares)
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
<S> <C> <C>
YEAR ENDED FEBRUARY 28, 1997
INTEREST INCOME $ 27,744,838
EXPENSES
Management fee $ 1,897,759
Transfer agent, accounting and custodian fees and 809,619
expenses
Non-interested trustees' compensation 1,188
Registration fees 9,303
Audit 37,611
Legal 4,950
Reports to shareholders 505
Miscellaneous 5,167
Total expenses before reductions 2,766,102
Expense reductions (4,126) 2,761,976
NET INTEREST INCOME 24,982,862
REALIZED AND UNREALIZED GAIN (LOSS)
Net realized gain (loss) on:
Investment securities 2,390,191
Futures contracts 25,940 2,416,131
Change in net unrealized appreciation (depreciation) on:
Investment securities 879,193
Futures contracts 156,172 1,035,365
NET GAIN (LOSS) 3,451,496
NET INCREASE (DECREASE) IN NET ASSETS RESULTING $ 28,434,358
FROM OPERATIONS
</TABLE>
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
<S> <C> <C>
YEAR ENDED YEAR ENDED
FEBRUARY 28, FEBRUARY 29,
1997 1996
INCREASE (DECREASE) IN NET ASSETS
Operations $ 24,982,862 $ 26,643,639
Net interest income
Net realized gain (loss) 2,416,131 (252,205)
Change in net unrealized appreciation (depreciation) 1,035,365 25,696,878
NET INCREASE (DECREASE) IN NET ASSETS RESULTING 28,434,358 52,088,312
FROM OPERATIONS
Distributions to shareholders (25,083,634) (26,643,639)
From net interest income
From net realized gain (127,452) -
TOTAL DISTRIBUTIONS (25,211,086) (26,643,639)
Share transactions 68,032,151 95,232,766
Net proceeds from sales of shares
Reinvestment of distributions 17,866,882 18,770,502
Cost of shares redeemed (101,203,598) (118,512,417)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING (15,304,565) (4,509,149)
FROM SHARE TRANSACTIONS
TOTAL INCREASE (DECREASE) IN NET ASSETS (12,081,293) 20,935,524
NET ASSETS
Beginning of period 497,979,208 477,043,684
End of period (including undistributed net interest $ 485,897,915 $ 497,979,208
income of $0 and $100,772, respectively)
OTHER INFORMATION
Shares
Sold 5,877,607 8,288,904
Issued in reinvestment of distributions 1,542,356 1,634,924
Redeemed (8,759,027) (10,325,933)
Net increase (decrease) (1,339,064) (402,105)
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
FINANCIAL HIGHLIGHTS
YEAR ENDED YEAR ENDED YEARS ENDED TEN MONTHS
FEBRUARY FEBRUARY FEBRUARY 28, ENDED
28, 29, FEBRUARY
28,
1997 1996 1995 1994 C 1993
SELECTED PER-SHARE DATA
Net asset value, beginning $ 11.720 $ 11.120 $ 12.100 $ 12.430 $ 11.540
of period
Income from Investment .599 .625 .685 .719 .611
Operations
Net interest income
Net realized and unrealized .096 .597 (.830) (.060) .890
gain (loss)
Total from investment .695 1.222 (.145) .659 1.501
operations
Less Distributions
From net interest income (.602) (.622) (.685) (.719) (.611)
From net realized gain (.003) - (.150) (.270) -
Total distributions (.605) (.622) (.835) (.989) (.611)
Net asset value, end of period $ 11.810 $ 11.720 $ 11.120 $ 12.100 $ 12.430
TOTAL RETURN B 6.16% 11.25% (.91) 5.41% 13.40%
%
RATIOS AND SUPPLEMENTAL
DATA
Net assets, end of period $ 485,898 $ 497,979 $ 477,044 $ 575,289 $ 586,791
(000 omitted)
Ratio of expenses to average .57% .58% .56% .57% .60%
net assets A
Ratio of net interest income to 5.19% 5.44% 6.16% 5.78% 6.17%
average net assets A
Portfolio turnover rate 17% 37% 29% 44% 32%
A
</TABLE>
A ANNUALIZED
B TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED.
C EFFECTIVE MARCH 1, 1993, THE FUND ADOPTED STATEMENT OF POSITION 93-2,
"DETERMINATION, DISCLOSURE, AND FINANCIAL STATEMENT PRESENTATION OF INCOME,
CAPITAL GAIN, AND RETURN OF CAPITAL DISTRIBUTIONS BY INVESTMENT COMPANIES."
AS A RESULT, NET INTEREST INCOME PER SHARE MAY REFLECT CERTAIN
RECLASSIFICATIONS RELATED TO BOOK TO TAX DIFFERENCES.
FIDELITY CALIFORNIA INSURED MUNICIPAL INCOME FUND
PERFORMANCE: THE BOTTOM LINE
There are several ways to evaluate a fund's historical performance. You can
look at the total percentage change in value, the average annual percentage
change, or the growth of a hypothetical $10,000 investment. Total return
reflects the change in the value of an investment, assuming reinvestment of
the fund's dividend income and capital gains (the profits earned upon the
sale of securities that have grown in value). You can also look at the
fund's income, as reflected in the fund's yield, to measure performance. If
Fidelity had not reimbursed certain fund expenses the past five year and
past 10 year total returns would have been lower.
CUMULATIVE TOTAL RETURNS
<TABLE>
<CAPTION>
<S> <C> <C> <C>
PERIODS ENDED FEBRUARY 28, 1997 PAST 1 PAST 5 PAST 10
YEAR YEARS YEARS
Fidelity California Insured Municipal Income 5.49% 39.24% 87.28%
Lehman Brothers California Insured 1-26 Ye 5.24% n/a n/a
ar
Municipal Bond Index
California Insured Municipal Funds Averag 4.36% 42.55% 93.12%
e
</TABLE>
CUMULATIVE TOTAL RETURNS show the fund's performance in percentage terms
over a set period - in this case, one year, five years, or 10 years. For
example, if you invested $1,000 in a fund that had a 5% return over the
past year, the value of your investment would be $1,050. You can compare
the fund's returns to the performance of the Lehman Brothers California
Insured 1-26 Year Municipal Bond Index - a total return performance
benchmark for insured California investment-grade municipal bonds with
maturities between one and 26 years. To measure how the fund's performance
stacked up against its peers, you can compare it to the California insured
municipal funds average, which reflects the performance of 28 mutual funds
with similar objectives tracked by Lipper Analytical Services Inc. over the
past one year. Both benchmarks include reinvested dividends and capital
gains, if any, and exclude the effect of sales charges.
AVERAGE ANNUAL TOTAL RETURNS
<TABLE>
<CAPTION>
<S> <C> <C> <C>
PERIODS ENDED FEBRUARY 28, 1997 PAST 1 PAST 5 PAST 10
YEAR YEARS YEARS
Fidelity California Insured Municipal Income 5.49% 6.85% 6.48%
Lehman Brothers California Insured 1-26 Ye 5.24% n/a n/a
ar
Municipal Bond Index
California Insured Municipal Funds Averag 4.36% 7.34% 6.80%
e
</TABLE>
AVERAGE ANNUAL TOTAL RETURNS take the fund's cumulative return and show you
what would have happened if the fund had performed at a constant rate each
year. (Note: Lipper calculates average annual total returns by annualizing
each fund's total return, then taking an arithmetic average. This may
produce a slightly different figure than that obtained by averaging the
cumulative total returns and annualizing the result.)
$10,000 OVER 10 YEARS
IMAHDR PRASUN SHR__CHT 19970228 19970320 100641 S00000000000001
CA INSURED MUNI INCOME LB MUNICIPAL BOND
00403 LB015
1987/02/28 10000.00 10000.00
1987/03/31 9913.87 9894.00
1987/04/30 9090.42 9397.52
1987/05/31 8974.29 9350.91
1987/06/30 9090.90 9625.45
1987/07/31 9189.21 9723.63
1987/08/31 9240.18 9745.51
1987/09/30 8690.68 9386.19
1987/10/31 8935.50 9419.42
1987/11/30 9149.56 9665.36
1987/12/31 9293.49 9805.60
1988/01/31 9847.62 10154.88
1988/02/29 9981.85 10262.22
1988/03/31 9579.38 10143.17
1988/04/30 9633.09 10220.26
1988/05/31 9643.77 10190.73
1988/06/30 9799.22 10339.82
1988/07/31 9829.49 10407.23
1988/08/31 9893.59 10416.39
1988/09/30 10086.77 10604.93
1988/10/31 10378.34 10791.57
1988/11/30 10240.21 10692.72
1988/12/31 10372.52 10802.11
1989/01/31 10559.73 11025.50
1989/02/28 10429.52 10899.70
1989/03/31 10432.23 10873.65
1989/04/30 10712.42 11131.79
1989/05/31 10927.36 11362.99
1989/06/30 11041.33 11517.30
1989/07/31 11156.01 11674.05
1989/08/31 10997.97 11559.76
1989/09/30 11011.95 11525.32
1989/10/31 11090.41 11666.27
1989/11/30 11265.54 11870.43
1989/12/31 11281.51 11967.53
1990/01/31 11176.75 11910.92
1990/02/28 11354.33 12016.93
1990/03/31 11346.60 12020.54
1990/04/30 11157.10 11933.51
1990/05/31 11444.47 12194.02
1990/06/30 11553.10 12301.20
1990/07/31 11733.57 12482.03
1990/08/31 11540.73 12300.79
1990/09/30 11579.47 12307.80
1990/10/31 11763.94 12531.07
1990/11/30 12034.58 12783.07
1990/12/31 12073.12 12838.67
1991/01/31 12160.16 13010.97
1991/02/28 12183.93 13124.16
1991/03/31 12184.21 13128.89
1991/04/30 12347.30 13303.50
1991/05/31 12473.87 13421.77
1991/06/30 12448.51 13408.48
1991/07/31 12626.78 13571.80
1991/08/31 12753.92 13750.54
1991/09/30 12935.91 13929.57
1991/10/31 13118.26 14054.94
1991/11/30 13131.79 14094.15
1991/12/31 13396.42 14396.61
1992/01/31 13452.14 14429.43
1992/02/29 13449.96 14434.05
1992/03/31 13465.70 14439.39
1992/04/30 13599.41 14567.90
1992/05/31 13776.18 14739.37
1992/06/30 14017.38 14986.69
1992/07/31 14479.80 15435.99
1992/08/31 14207.76 15285.49
1992/09/30 14302.27 15385.46
1992/10/31 13972.19 15234.22
1992/11/30 14372.40 15507.07
1992/12/31 14622.73 15665.39
1993/01/31 14790.32 15847.58
1993/02/28 15568.83 16420.79
1993/03/31 15359.73 16247.22
1993/04/30 15516.44 16411.15
1993/05/31 15590.63 16503.39
1993/06/30 15890.42 16778.83
1993/07/31 15849.33 16800.81
1993/08/31 16252.86 17150.60
1993/09/30 16452.85 17345.95
1993/10/31 16466.83 17379.42
1993/11/30 16228.22 17226.31
1993/12/31 16643.45 17589.96
1994/01/31 16851.30 17790.84
1994/02/28 16282.89 17330.05
1994/03/31 15342.19 16624.37
1994/04/30 15430.30 16765.35
1994/05/31 15565.63 16910.70
1994/06/30 15369.50 16807.38
1994/07/31 15709.82 17115.46
1994/08/31 15736.33 17174.68
1994/09/30 15411.35 16922.55
1994/10/31 15025.14 16622.01
1994/11/30 14636.20 16321.48
1994/12/31 14938.96 16680.72
1995/01/31 15532.42 17157.45
1995/02/28 16071.47 17656.39
1995/03/31 16195.64 17859.26
1995/04/30 16169.24 17880.34
1995/05/31 16755.15 18450.90
1995/06/30 16428.22 18290.38
1995/07/31 16551.27 18463.77
1995/08/31 16790.76 18697.89
1995/09/30 16927.89 18816.25
1995/10/31 17235.90 19089.84
1995/11/30 17643.01 19406.54
1995/12/31 17851.49 19593.03
1996/01/31 17974.92 19740.96
1996/02/29 17753.19 19607.71
1996/03/31 17503.26 19357.12
1996/04/30 17408.07 19302.34
1996/05/31 17382.58 19294.62
1996/06/30 17580.63 19504.74
1996/07/31 17764.19 19682.23
1996/08/31 17752.68 19677.51
1996/09/30 18035.13 19952.99
1996/10/31 18255.40 20178.66
1996/11/30 18670.96 20547.93
1996/12/31 18537.50 20461.63
1997/01/31 18565.08 20500.30
1997/02/28 18728.02 20688.50
IMATRL PRASUN SHR__CHT 19970228 19970320 100644 R00000000000123
$10,000 OVER 10 YEARS: Let's say hypothetically that $10,000 was invested
in Fidelity California Insured Municipal Income Fund on February 28, 1987.
As the chart shows, by February 28, 1997, the value of the investment would
have grown to $18,728 - an 87.28% increase on the initial investment. For
comparison, look at how the Lehman Brothers Municipal Bond Index, which
reflects the performance of the investment-grade municipal bond market, did
over the same period. With dividends and capital gains, if any, reinvested,
the same $10,000 would have grown to $20,688 - a 106.88% increase.
UNDERSTANDING
PERFORMANCE
How a fund did yesterday is
no guarantee of how it will
do tomorrow.
(checkmark)
TOTAL RETURN COMPONENTS
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
YEAR ENDED YEAR ENDED YEARS ENDED FEBRUARY 28,
FEBRUARY FEBRUARY
28, 29,
1997 1996 1995 1994 1993
Dividend return 5.29% 5.48% 5.50% 5.35% 6.43%
Capital appreciation return 0.20% 4.98% -6.80% -0.76% 9.32%
Total return 5.49% 10.46% -1.30% 4.59% 15.75%
</TABLE>
TOTAL RETURN COMPONENTS include both dividend returns and capital
appreciation returns. A dividend return reflects the actual dividends paid
by the fund. A capital appreciation return reflects both the amount paid by
the fund to shareholders as capital gain distributions and changes in the
fund's share price. Both returns assume the dividends or capital gains paid
by the fund are reinvested.
DIVIDENDS AND YIELD
<TABLE>
<CAPTION>
<S> <C> <C> <C>
PERIODS ENDED FEBRUARY 28, 1997 PAST PAST 6 PAST 1
MONTH MONTHS YEAR
Dividends per share 4.04(cents) 25.90(cents) 52.48(cents)
Annualized dividend rate 5.07% 5.09% 5.16%
30-day annualized yield 4.65% - -
30-day annualized tax-equivalent yield 8.01% - -
</TABLE>
DIVIDENDS per share show the income paid by the fund for a set period. If
you annualize this number, based on an average share price of $10.38 over
the past one month, $10.27 over the past six months and $10.17 over the
past one year, you can compare the fund's income over these three periods.
Dividends per share show the income paid by the fund for a set period and
do not reflect any tax reclassifications. The 30-day annualized YIELD is a
standard formula for all funds based on the yields of the bonds in the
fund, averaged over the past 30 days. This figure shows you the yield
characteristics of the fund's investments at the end of the period. It also
helps you compare funds from different companies on an equal basis. The
tax-equivalent yield shows what you would have to earn on a taxable
investment to equal the fund's tax-free yield, if you're in the 41.95%
combined effective 1997 federal and state tax bracket but does not reflect
the payment of the federal alternative minimum tax, if applicable.
FIDELITY CALIFORNIA INSURED MUNICIPAL INCOME FUND
FUND TALK: THE MANAGER'S OVERVIEW
MARKET RECAP
Stable demand helped municipal
bonds perform better than their
investment-grade taxable
counterparts in the 12 months
ending February 28, 1997.
However, anticipation of
short-term interest rate increases
by the Federal Reserve Board
negatively affected all bonds. For
the period, the Lehman
Brothers Municipal Bond Index
- - a broad measure of the
municipal bond market - had a
total return of 5.51%. In
comparison, the Lehman Brothers
Aggregate Bond Index - a broad
measure of the performance of the
U.S. taxable bond market -
returned 5.35%. New issue supply
in the municipal market was
strong through the first half of the
period, but insurance companies
and individual investors helped
sustain demand. The diminishing
likelihood of significant tax reform
in the near future also helped
support the muni market. Like
most domestic bonds, munis were
affected by signs of strength in the
economy in the first half of 1996.
Nevertheless, the market
conditions that supported the
muni market helped it enter the fall
trading at expensive levels
relative to its taxable counterparts.
Munis stalled because their rich
valuations inhibited demand and
encouraged selling. From
December on, most bond markets
suffered from fears - confirmed
by Fed Chairman Alan
Greenspan's testimony before
Congress in late February - that
latent inflation pressures might
encourage the Fed to raise
short-term rates. Munis, however,
outperformed over the past few
months, in part because of a thin
supply of new issues.
(Portfolio Manager: Jonathan Short photograph)
An interview with Jonathan Short, Portfolio Manager of Fidelity California
Insured Municipal Income Fund
Q. HOW DID THE FUND PERFORM, JON?
A. For the year ending February 28, 1997, the fund had a total return of
5.49%. For comparison purposes, the California insured municipal debt funds
average, as tracked by Lipper Analytical Services, returned 4.36%, and the
Lehman Brothers California Insured 1-26 Year Municipal Bond Index returned
5.24% for the same one year period.
Q. WHAT TYPES OF BONDS DID WELL?
A. Uninsured municipal securities were some of the market's - and the
fund's - best performers and were a key reason why the fund fared better
than many of its competitors. While the vast majority of this fund's
holdings are insured bonds, I use uninsured bonds as a way of adding more
yield to the fund. The main driver for the strong returns of uninsured
bonds was tightening credit spreads, which meant that lower-quality bonds
provided a smaller yield advantage over higher-quality bonds at the end of
the period than they did at the beginning. As a result, uninsured bonds
generally performed better than insured bonds.
Q. WHAT STRATEGIES DID YOU EMPLOY OVER THE PAST SIX MONTHS?
A. I focused on bonds with maturities in the intermediate range - those
with maturities of between five and 20 years - while keeping the fund's
holdings in shorter- and longer-term bonds light. I chose to emphasize
intermediate bonds because I believed that their expected total return was
greater than that of longer-maturity bonds. Additionally, I did not believe
that many longer-term securities offered enough additional yield to
compensate investors for their added interest rate sensitivity. All in all,
I felt that intermediate maturity bonds were attractive on a risk/return
basis over the period.
Q. GENERAL OBLIGATION BONDS (GOS) MADE UP THE FUND'S LARGEST SECTOR
CONCENTRATION AT THE END OF THE PERIOD. WHICH TYPES OF GOS DID YOU TARGET?
A. A large portion of the fund's stake in GOs are state general obligation
bonds, which are issued by the state, backed by its full faith and credit,
and are repaid by general revenue, in contrast to revenue from a specific
facility or project built with borrowed funds. In my opinion, the state's
credit worthiness has improved as its economy has rebounded. In fact,
revenue collections have improved to the point where estimates call for the
state's budget to post $1 billion more in revenues than originally
projected.
Q. WHAT THINGS DO YOU CONSIDER WHEN DETERMINING THE OVERALL STRUCTURE OF
THE PORTFOLIO?
A. I place a lot of emphasis on the price breakdown of the bonds. I prefer
to have a lighter position in callable "par" bonds - those with prices
between $97 and $103 - and a heavier weighting in discount and premium
bonds with prices below $97 or above $103, respectively. The main reason
for this strategy is that I feel that par bonds are more susceptible to
call risk, where the issuer can redeem an issue before its maturity.
Similarly, I also look for bonds with good "call protection." When interest
rates fall, municipal issuers often call - or redeem - bonds before their
maturity and issue new bonds as a way to lower their interest costs. So I
focus on bonds with good call protection - those that have some longer
period of time before they legally can be called away - and non-callable
bonds, which can't be redeemed by their issuer before maturity.
Q. WHAT'S YOUR OUTLOOK?
A. From a supply and demand standpoint, I'm optimistic about municipals. I
don't expect to see a tremendous amount of new bonds issued. What increase
in supply we see likely will be easily digested if demand remains firm. How
municipals fare over the next year will depend heavily on the direction of
interest rates, but I don't think anyone can accurately pinpoint where
interest rates will be a year from now. That said, we may continue to see
some volatility in the bond market as long as there are conflicting signs
about the economy and inflation trends.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO MANAGER
ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON THE COVER.
THE MANAGER'S VIEWS ARE SUBJECT TO CHANGE AT ANY TIME BASED ON MARKET AND
OTHER CONDITIONS.
FUND FACTS
GOAL: high current
tax-free income for California
residents
FUND NUMBER: 403
TRADING SYMBOL: FCXIX
START DATE: September 18,
1986
SIZE: as of February 28, 1997,
more than $205 million
MANAGER: Jonathan Short,
since 1995; manager,
Spartan Florida Municipal
Income, since 1996; Fidelity
Advisor California Municipal
Income and Spartan
Arizona Municipal Income,
since 1995; Spartan California
Municipal Income, Spartan
California Intermediate
Municipal Income, Fidelity
California Municipal Income
and Fidelity Minnesota
Municipal Income, since 1995;
joined Fidelity in 1990
(checkmark)
JONATHAN SHORT ON
CALIFORNIA'S ECONOMY:
"The strength of California's
economic rebound is an
important component in the
overall performance of
California municipal bonds.
For a number of reasons, I am
optimistic about California's
economy. The first is
employment growth, which
continues to outpace the nation
as a whole. Second, the state
budget is posting revenues well
ahead of projections, thanks
mostly to rising tax collections.
Third, the rebound has grown
to be more broad-based, with
Southern California finally
showing improvements after
lagging behind the northern part
of the state. Finally, permits to
build new houses are up
about 15% this year and sales
of existing homes seem to
have stabilized."
FIDELITY CALIFORNIA INSURED MUNICIPAL INCOME FUND
INVESTMENT CHANGES
TOP FIVE SECTORS AS OF FEBRUARY 28, 1997
% OF FUND'S % OF FUND'S INVESTMENT
INVESTMENTS S
IN THESE SECTORS
6 MONTHS AGO
General Obligation 27.3 26.5
Electric Revenue 15.4 14.4
Water & Sewer 14.7 13.4
Lease Revenue 14.0 14.1
Special Tax 12.0 14.2
AVERAGE YEARS TO MATURITY AS OF FEBRUARY 28, 1997
6 MONTHS AGO
Years 15.5 15.9
AVERAGE YEARS TO MATURITY IS BASED ON THE AVERAGE TIME UNTIL PRINCIPAL
PAYMENTS ARE EXPECTED FROM EACH OF THE FUND'S BONDS, WEIGHTED BY DOLLAR
AMOUNT.
DURATION AS OF FEBRUARY 28, 1997
6 MONTHS AGO
Years 7.9 8.0
DURATION SHOWS HOW MUCH A BOND FUND'S PRICE FLUCTUATES WITH CHANGES IN
COMPARABLE INTEREST RATES. IF RATES RISE 1%, FOR EXAMPLE, A FUND WITH A
FIVE-YEAR DURATION IS LIKELY TO LOSE ABOUT 5% OF ITS VALUE. OTHER FACTORS
ALSO CAN INFLUENCE A BOND FUND'S PERFORMANCE AND SHARE PRICE. ACCORDINGLY,
A BOND FUND'S ACTUAL PERFORMANCE MAY DIFFER FROM THIS EXAMPLE.
QUALITY DIVERSIFICATION (MOODY'S RATINGS)
AS OF FEBRUARY 28, 1997 AS OF AUGUST 31, 1996
Aaa 68.1%
Aa, A 24.5%
Baa 5.0%
Caa 0.0%
Non-rated 0.0%
Short-term
investments 2.4%
Aaa 69.9%
Aa, A 21.5%
Baa 5.6%
Caa 0.0%
Non-rated 0.0%
Short-term
investments 3.0%
Row: 1, Col: 1, Value: 68.09999999999999
Row: 1, Col: 2, Value: 24.5
Row: 1, Col: 3, Value: 5.0
Row: 1, Col: 4, Value: 0.0
Row: 1, Col: 5, Value: 0.0
Row: 1, Col: 6, Value: 2.4
Row: 1, Col: 1, Value: 69.90000000000001
Row: 1, Col: 2, Value: 21.5
Row: 1, Col: 3, Value: 5.6
Row: 1, Col: 4, Value: 0.0
Row: 1, Col: 5, Value: 0.0
Row: 1, Col: 6, Value: 3.0
69.9
SHOWN AS A PERCENTAGE OF THE FUND'S INVESTMENTS. WHERE MOODY'S RATINGS ARE
NOT AVAILABLE, WE HAVE USED S&P RATINGS.
FIDELITY CALIFORNIA INSURED MUNICIPAL INCOME FUND
INVESTMENTS FEBRUARY 28, 1997
Showing Percentage of Total Value of Investments in Securities
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MUNICIPAL BONDS - 97.6%
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (B) AMOUNT (NOTE 1)
CALIFORNIA - 97.6%
Alameda County Ctfs. of Prtn. Rfdg.
(Santa Rita Jail Proj.) 5.375%
6/1/09 (MBIA Insured) Aaa $ 1,750,000 $ 1,798,125
Burbank Redev. Agcy. Tax Allocation
(City Ctr. Redev. Proj.) Series A, 5%
12/1/15 (FGIC Insured) Aaa 4,000,000 3,715,000
California Dept. Wtr. Resources Rev.
(Central VY Proj.) Series O, 4.75% 12/1/17 Aa 1,000,000 887,500
California Edl. Facs. Auth. Rev.:
Rfdg. (Univ. of Southern California) Series A,
5.65% 10/1/10 (f) Aa3 740,000 748,325
(Pooled Facs. Prog.) Series 1987,
7.625% 11/1/12 (MBIA Insured) Aaa 1,000,000 1,039,560
California Gen. Oblig.:
5.50% 6/1/03 A1 2,000,000 2,100,000
6% 9/1/03 A1 1,000,000 1,080,000
6.90% 4/1/05 A1 1,000,000 1,142,500
6.50% 9/1/10 A1 1,500,000 1,691,250
5.25% 10/1/14 A1 1,000,000 971,250
6.25% 10/1/19 A1 2,100,000 2,296,875
California Health Facs. Fin. Auth. Rev. Rfdg.
(Children's Hosp.): Aaa 1,200,000 1,293,000
6% 7/1/03 (MBIA Insured)
6% 7/1/06 (MBIA Insured) Aaa 500,000 541,875
California Hsg. Fin. Agcy. Rev. (Home Mtg.):
Series 1983 A, 0% 2/1/15 Aa 8,187,000 1,404,807
Series 1983 B, 0% 8/1/15 Aa 170,000 26,350
Series R, 5.25% 8/1/16 (MBIA Insured) (h) Aaa 1,000,000 995,000
California Pub. Cap. Impt. Fing. Auth. Rev.
(Pooled Proj.) Series B,
8.10% 3/1/18 (MBIA Insured) Aaa 2,830,000 2,963,916
California Pub. Works Board Lease Rev.:
Rfdg. (Dept. Corrections State Prisons)
Series A, 5% 12/1/19 (AMBAC Insured) Aaa 2,000,000 1,865,000
(Dept. Correction State Prisons, Madera)
Series E:
6% 6/1/07 A 1,500,000 1,603,125
5.50% 6/1/15 A 2,000,000 1,997,500
(University Projs.) Series B, 6.40% 12/1/09 A1 1,700,000 1,893,375
(Various Cmmty. College Projs.) Series C, 6%
3/1/05 (AMBAC Insured) Aaa 1,000,000 1,081,250
5% 6/1/06 A1 1,000,000 1,008,750
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (B) AMOUNT (NOTE 1)
CALIFORNIA - CONTINUED
California Statewide Commty. Dev. Auth.
5.10% 11/1/07 (MBIA Insured) Aaa $ 1,000,000 $ 1,002,500
California Statewide Commty. Dev. Auth. Rev.
Ctfs. of Prtn.:
(Childrens Hosp.) 6% 6/1/11 (MBIA Insured) Aaa 1,700,000 1,814,750
(Sisters Charity Leavenworth Sys.):
4.875% 12/1/10 Aa3 1,000,000 946,250
5.616% 7/1/13 Aaa 2,000,000 1,982,500
5% 12/1/23 Aa3 1,000,000 903,750
Carson Redev. Agcy. Redev. Proj. Area #1
Tax Allocation Rfdg. 6.375% 10/1/12 Baa1 1,000,000 1,021,250
Castaic Lake Wtr. Agcy. Ctfs. of Prtn. Rfdg.
(Wtr. Sys. Impt. Proj.) Series A:
7% 8/1/12 (MBIA Insured) Aaa 1,000,000 1,181,250
7% 8/1/13 (MBIA Insured) Aaa 1,580,000 1,868,350
Central Valley Fin. Auth. Rev.
(Cogeneration Proj.)(Carson Ice Proj.)
5.80% 7/1/04 BBB- 500,000 517,500
Chino Basin Fng. Auth. Rev. (Mun. Wtr. Dist.
Swr. Sys. Proj.) 7.0% 8/1/06 (AMBAC Insured) Aaa 1,145,000 1,332,494
Contra Costa Trans. Auth. Sales Tax Rev.
Series A: 6% 3/1/03 (FGIC Insured) Aaa 1,000,000 1,080,000
6% 3/1/04 (FGIC Insured) Aaa 500,000 542,500
Desert Hosp. Dist. Rev. Ctfs. of Prtn. 6.392%
7/28/20 (FSA Insured) Aaa 2,600,000 2,691,000
East Bay Muni. Util. Dist. Wastewtr. Treatment
6% 6/1/05 (FGIC Insured) Aaa 1,550,000 1,689,500
East Bay Muni. Util. Dist. Wtr. Sys. Rev. Rfdg:
6% 6/1/02 (FGIC Insured) Aaa 1,000,000 1,075,000
6% 6/1/06 (FGIC Insured) Aaa 1,840,000 2,014,800
6% 6/1/12 (FGIC Insured) Aaa 1,000,000 1,033,750
East Bay Reg'l. Park Dist.:
Series C, 6.50% 9/1/01 (FGIC Insured) Aaa 660,000 717,750
6.10% 9/1/06 Aa 1,000,000 1,058,750
Elk Grove Unified School Dist. Spl. Tax Rfdg.
(Commty. Facs. Dist. #1) 6.50%
12/1/24 (AMBAC Insured) Aaa 2,000,000 2,277,500
Encintas Unified School Dist. (Cap.
Appreciation) 0% 8/1/03 (MBIA Insured) Aaa 1,750,000 1,286,250
Eureka Unified School Dist. Ctfs. of Prtn.
(Cap. Appreciation):
Series A, 0% 9/1/27 (FSA Insured) (d) Aaa 660,000 715,275
Series B, 0% 9/1/27 (FSA Insured) (d) Aaa 1,555,000 1,483,081
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (B) AMOUNT (NOTE 1)
CALIFORNIA - CONTINUED
Fontana Redev. Agcy. Tax Allocation Rfdg.
(Jurupa Hills):
Series 1992 A, 7.10% 10/1/23 BBB $ 1,000,000 $ 1,046,250
Series A, 7% 10/1/14 BBB+ 2,300,000 2,420,750
Fremont Unified School Dist. Alameda County
(Cap. Appreciation) Series F, 0% 8/1/05
(MBIA Insured) Aaa 1,395,000 911,981
Irvine Ranch Wtr. Dist. Joint Pwr. Agcy.
Local Pool Rev.:
7.875% 2/15/23 A+ 3,850,000 3,972,276
8.25% 8/15/23 A+ 3,000,000 3,161,250
Kings River Conservation Dist. Rfdg.
(Pine Flats Proj.) 6.375% 1/1/12 Aa 1,000,000 1,053,750
Local Gov't. Fin. Auth. Rev. (Oakland Cent.
Dist.) 0% 9/1/09 (MBIA Insured) Aaa 3,565,000 1,840,431
Los Angeles County Ctfs. of Prtn. (Disney
Parking Proj.) (Cap. Appreciation) 0% 3/1/10 Baa1 2,000,000 885,000
Los Angeles County Metropolitan Trans. Auth.
Sales Tax Rev. Prop. C, Series A
5.90% 7/1/03 (AMBAC Insured) Aaa 1,750,000 1,885,625
Los Angeles Dept. Wtr. & Pwr. Elec. Plant Rev.
Rfdg. 4.75% 8/15/16 (FGIC Insured) Aaa 2,700,000 2,379,375
Los Angeles Hbr. Dept. Rev. 7.60% 10/1/18
(Escrowed to Maturity) (c) Aa 2,000,000 2,477,500
Los Angeles Wastewtr. Sys. Rev. Rfdg.:
Series A:
9% 6/1/00 (MBIA Insured) Aaa 500,000 570,000
6% 2/1/04 (FGIC Insured) Aaa 1,500,000 1,616,250
Series D, 5.20% 11/1/21 (FGIC Insured) Aaa 1,000,000 925,000
M-S-R Pub. Pwr. Agcy. Rev. (San Juan Proj.)
Series D, 6.75% 7/1/20 (MBIA Insured) Aaa 2,500,000 2,887,500
Metropolitan Wtr. Dist. Southern Wtrwks. Rev.:
Rfdg. Series B:
5% 7/1/14 (MBIA Insured) Aaa 1,140,000 1,074,450
5.75% 8/12/18 Aa 4,000,000 4,015,000
4.75% 7/1/21 (MBIA Insured) Aaa 3,000,000 2,636,250
Modesto Ctfs. of Prtn. (Commty. Ctr. Refing.
Proj.) Series A, 5% 11/1/23 (AMBAC Insured) Aaa 2,500,000 2,303,125
Modesto Irrigation Dist. Ctfs. of Prtn. Rfdg.
& Cap. Impts. Series A, 0% 10/1/09 (MBIA
Insured) Aaa 2,270,000 1,166,213
Moreno Valley Unified School Dist. Ctfs. of
Prtn. (Land Acquisition) 0% 9/1/11 (FSA
Insured) (d) Aaa 2,350,000 2,238,375
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (B) AMOUNT (NOTE 1)
CALIFORNIA - CONTINUED
Northern California Pwr. Agcy. Pub. Pwr. Rev.:
Rfdg. 7.50% 7/1/23 (AMBAC Insured)
(Pre-Refunded to 7/1/21 @ 100) (c) Aaa $ 1,300,000 $ 1,613,625
Crossover Rfdg. (Geothermal Proj. #3) Series
A:
5.50% 7/1/05 (AMBAC Insured) Aaa 500,000 526,875
5.80% 7/1/09 (AMBAC Insured) Aaa 1,085,000 1,152,813
Oakland Redev. Agcy. Central Dist. Redev.
(Sub. Tax Allocation) 5% 9/1/13
(MBIA Insured) Aaa 2,960,000 2,841,600
Ontario Redev. Fing. Auth.:
Rfdg. (Ontario Redev. Proj. #1) 6.90% 8/1/10
(MBIA Insured) Aaa 1,215,000 1,416,994
6.65% 8/1/07 (MBIA Insured) Aaa 500,000 572,500
6.75% 8/1/08 (MBIA Insured) Aaa 1,065,000 1,228,744
Pleasanton Joint Pwrs. Fin. Auth. Reassessment
Series A, 6% 9/2/05 Baa 1,490,000 1,549,600
Rancho Mirage Joint Pwrs. Fing. Auth.
Ctfs. of Prtn. (Eisenhower Mem. Hosp.)
7% 3/1/22 A2 1,000,000 1,131,250
Rancho Wtr. Dist. Fing. Rev. Rfdg. 6.50%
11/1/05 (FGIC Insured) Aaa 500,000 560,625
Redding Elec. Sys. Rev. Ctfs. of Prtn.
(Cap. Appreciation) Series A:
0% 6/1/05 (FGIC Insured) Aaa 2,000,000 1,340,000
0% 6/1/06 (FGIC Insured) Aaa 1,730,000 1,094,225
0% 6/1/07 (FGIC Insured) Aaa 1,890,000 1,119,825
0% 6/1/08 (FGIC Insured) Aaa 1,300,000 724,750
Redondo Beach Redev. Agcy. Tax Allocation
(South Bay Ctr.) 8.625% 5/1/14
(FGIC Insured) Aaa 1,000,000 1,016,640
Richmond Redev. Agcy. Tax Allocation
(Harbour Redev. Proj.) 7% 7/1/09
(FSA Insured) Aaa 1,750,000 1,953,438
Riverside County Asset Leasing Corp. Leasehold
Rev. (Riverside County Hosp. Proj.) Series A:
6.375% 6/1/09 A3 2,000,000 2,105,000
6.50% 6/1/12 A 5,500,000 5,926,250
Riverside Unified School Dist. Ctfs. of Prtn.
(Cap. Appreciation Land Acquisition Proj.)
Series B, 0% 9/1/26 (FSA Insured) (d) Aaa 1,710,000 1,633,050
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (B) AMOUNT (NOTE 1)
CALIFORNIA - CONTINUED
Sacramento Cogeneration Auth. Pwr. &
Gas (Cogeneration Proj.):
6% 7/1/03 BBB- $ 700,000 $ 730,625
6.50% 7/1/07 BBB- 1,000,000 1,067,500
6.5% 7/1/08 BBB- 1,000,000 1,063,750
Sacramento Fing. Auth. Gas Tax Rev. Series A,
6% 10/1/07 (AMBAC Insured) Aaa 1,290,000 1,406,100
Sacramento Fing. Auth. Lease Rev. Rfdg.
Series A, 5.375% 11/1/14
(AMBAC Insured) Aaa 6,500,000 6,467,500
Sacramento Muni. Util. Dist. Elec. Rev.:
Rfdg. Series G, 6.5% 9/1/13
(MBIA Insured) (g) Aaa 7,000,000 7,901,250
1.76% 11/15/08 (FGIC Insured) (e) Aaa 3,700,000 3,575,125
6.30% 8/15/18 (FGIC Insured) Aaa 2,000,000 2,085,000
San Diego County Reg'l. Trans. Commission
Sales Tax Rev. Second Series A.:
6.25% 4/1/03 (FGIC Insured) Aaa 4,000,000 4,365,000
6% 4/1/04 (FGIC Insured) Aaa 1,150,000 1,244,875
San Francisco City & County Int'l. Arpt. Rev.:
Rfdg. Series 2, 6.20% 5/1/05
(AMBAC Insured) Aaa 1,000,000 1,082,500
6% 5/1/13 (FGIC Insured) Aaa 1,075,000 1,115,313
San Francisco City & County Swr. Rev.:
Rfdg. 5.90% 10/1/08 (AMBAC Insured) Aaa 1,000,000 1,056,250
Series B, 0% 10/1/07 (FGIC Insured) Aaa 4,770,000 2,796,413
San Jacinto Unified School Dist. Series B,
0% 9/1/26 (FSA Insured) (d) Aaa 1,585,000 1,624,625
San Joaquin County Ctfs. of Prtn.:
Rfdg. (Cap. Facs. Proj.) 5% 11/15/09
(MBIA Insured) Aaa 1,000,000 993,750
(Gen. Hosp. Proj.) 6.625% 9/1/20 A 2,500,000 2,618,750
San Jose Arpt. Rev. Rfdg. 5.875% 3/1/07
(FGIC Insured) Aaa 1,905,000 2,055,019
San Jose Ctfs. of Prtn. Rfdg. (Communication
Ctr. Proj.) 6.50% 5/1/10 (MBIA Insured) Aaa 1,500,000 1,614,375
San Jose Redev. Agcy. Tax Alloc. (Merged Area
Redev. Proj.) 6% 8/1/15 (MBIA Insured) Aaa 3,000,000 3,202,500
Santa Ana Commty. Redev. Agcy. Tax Allocation
(South Main St. Redev.) 5.25%
9/1/13 (MBIA Insured) Aaa 3,000,000 2,895,000
Santa Rosa Waste Wtr. Rev. Rfdg. (Sub Reg'l.
Wastewtr. Proj.) Series A,
4.75% 9/1/16 (FGIC Insured) Aaa 900,000 803,250
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (B) AMOUNT (NOTE 1)
CALIFORNIA - CONTINUED
South Orange County Pub. Fing. Auth.
Spl. Tax Rev.:
(Foothill Area) Series C, 7.50%
8/15/07 (FGIC Insured) Aaa $ 2,290,000 $ 2,779,485
(Sr. Lien) Series A, 7% 9/1/09 (MBIA Insured) Aaa 2,000,000 2,355,000
Southern California Pub. Pwr. Auth.
Transmission Proj. Rev. Rfdg. (Sub Southern
Transmission) Series A, 6% 7/1/06 (MBIA
Insured) Aaa 1,000,000 1,092,500
Sulpher Springs Unified School Dist.
Series A, 0% 9/1/08 (MBIA Insured) Aaa 2,000,000 1,087,500
Tahoe-Truckee Joint Union School Dist.
(Cap. Appreciation) Series A, 0% 9/1/10
(FGIC Insured) Aaa 6,625,000 3,180,000
Upland Ctfs. of Prtn. (San Antonio Commty.
Hosp.) 5% 1/1/18 A 1,000,000 875,000
West Covina Ctfs. of Prtn. (Queen of the
Valley Hosp.) 6.50% 8/15/24 A2 1,000,000 1,038,750
TOTAL MUNICIPAL BONDS
(Cost $191,692,125) 199,526,943
MUNICIPAL NOTES (A) - 2.4%
CALIFORNIA - 2.4%
Los Angeles County Metropolitan Trans. Auth.
Participating VRDN, Series SGB-1, 3.55%
(Liquidity Facility Societe Generale
France) (i) AAA 1,975,000 1,975,000
Orange County Sanitation Dist. Ctfs. of
Prtn. (Cap. Impt. Prog.) (Dist. 1-7 & 11)
3.65% (FGIC Insured) VRDN VMIG 1 2,900,000 2,900,000
TOTAL MUNICIPAL NOTES
(Cost $4,875,000) 4,875,000
TOTAL INVESTMENTS - 100%
(Cost $196,567,125) $204,401,943
FUTURES CONTRACTS
EXPIRATION UNDERLYING FACE UNREALIZED
DATE AMOUNT AT VALUE GAIN/(LOSS)
PURCHASED
10 Municipal Bond Contracts June 1997 $ 1,142,188 $ (2,903)
17 30-Year Treasury Bond Contracts June 1997 1,877,438 (1,748)
$ (4,651)
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THE FACE VALUE OF FUTURES PURCHASED AS A PERCENTAGE OF TOTAL INVESTMENT IN
SECURITIES - 1.5%
SECURITY TYPE ABBREVIATIONS
VRDN - Variable Rate Demand Notes
LEGEND
(a) The coupon rate shown on floating or adjustable rate securities
represents the rate at period end.
(b) Standard & Poor's Corporation credit ratings are used in the absence of
a rating by Moody's Investors Service, Inc.
(c) Security collateralized by an amount sufficient to pay interest and
principal.
(d) Debt obligation initially issued in zero coupon form which converts to
coupon form at a specified rate and date.
(e) Debt obligation initially issued at one coupon which converts to a
higher coupon at a specified date.
(f) Security purchased on a delayed delivery basis (see Note 2 of Notes to
Financial Statements).
(g) A portion of the security was pledged to cover margin requirements for
futures contracts. At the period end, the value of securities pledged
amounted to $3,386,250.
(h) Private activity obligations whose interest is subject to the federal
alternative minimum tax for individuals.
(i) Provides evidence of ownership in one or more underlying municipal
bonds.
OTHER INFORMATION
The composition of long-term debt holdings as a percentage of total value
of investment in securities, is as follows (ratings are unaudited):
MOODY'S RATINGS S&P RATINGS
Aaa, Aa, A 88.7% AAA, AA, A 92.0%
Baa 1.7% BBB 4.3%
Ba 0.0% BB 0.0%
B 0.0% B 0.0%
Caa 0.0% CCC 0.0%
Ca, C 0.0% CC, C 0.0%
D 0.0%
The percentage not rated by either S&P or Moody's amounted to 0.0%. FMR has
determine that unrated debt securities that are lower quality account for
0.0% of the total value of investment in securities.
The distribution of municipal securities by revenue source, as a percentage
of total value of investment in securities, is as follows:
General Obligation 27.3%
Electric Revenue 15.4
Water & Sewer 14.7
Lease Revenue 14.0
Special Tax 12.0
Health Care 6.0
Others (individually less than 5%) 10.6
TOTAL 100.0%
INCOME TAX INFORMATION
At February 28, 1997, the aggregate cost of investment securities for
income tax purposes was $196,567,125. Net unrealized appreciation
aggregated $7,834,818, of which $8,315,831 related to appreciated
investment securities and $481,013 related to depreciated investment
securities.
At February 28, 1997, the fund had a capital loss carryforward of
approximately $7,171,000 of which $647,000 will expire on February 28, 2003
and $6,524,000 will expire on February 29, 2004.
At February 28, 1997, the fund was required to defer approximately $369,557
of losses on futures contracts.
During fiscal year ended 1997, 100% (unaudited) of the fund's income
dividends was free from federal income tax, and .23% (unaudited) of the
fund's income dividends was subject to the federal alternative minimum tax.
FIDELITY CALIFORNIA INSURED MUNICIPAL INCOME FUND
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
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FEBRUARY 28, 1997
ASSETS
Investment in securities, at value (cost $196,567,125) - $ 204,401,943
See accompanying schedule
Cash 38,092
Interest receivable 2,756,312
Receivable for daily variation on futures contracts 3,500
TOTAL ASSETS 207,199,847
LIABILITIES
Payable for investments purchased $ 739,370
Payable for fund shares redeemed 60,012
Distributions payable 349,466
Accrued management fee 67,424
Other payables and accrued expenses 66,296
TOTAL LIABILITIES 1,282,568
NET ASSETS $ 205,917,279
Net Assets consist of:
Paid in capital $ 205,623,870
Accumulated undistributed net realized gain (loss) (7,536,758)
on investments
Net unrealized appreciation (depreciation) on 7,830,167
investments
NET ASSETS, for 19,890,562 shares outstanding $ 205,917,279
NET ASSET VALUE, offering price and redemption price per $10.35
share ($205,917,279 (divided by) 19,890,562 shares)
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
<S> <C> <C>
YEAR ENDED FEBRUARY 28, 1997
INTEREST INCOME $ 11,765,684
EXPENSES
Management fee $ 827,688
Transfer agent, accounting and custodian fees and 373,388
expenses
Non-interested trustees' compensation 809
Registration fees 9,275
Audit 42,073
Legal 2,472
Miscellaneous 2,479
Total expenses before reductions 1,258,184
Expense reductions (1,795) 1,256,389
NET INTEREST INCOME 10,509,295
REALIZED AND UNREALIZED GAIN (LOSS)
Net realized gain (loss) on:
Investment securities 266,821
Futures contracts 181,518 448,339
Change in net unrealized appreciation (depreciation) on:
Investment securities (269,421)
Futures contracts (4,651) (274,072)
NET GAIN (LOSS) 174,267
NET INCREASE (DECREASE) IN NET ASSETS RESULTING $ 10,683,562
FROM OPERATIONS
</TABLE>
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
<S> <C> <C>
YEAR ENDED YEAR ENDED
FEBRUARY 28, FEBRUARY 29,
1997 1996
INCREASE (DECREASE) IN NET ASSETS
Operations $ 10,509,295 $ 11,515,316
Net interest income
Net realized gain (loss) 448,339 (2,341,007)
Change in net unrealized appreciation (depreciation) (274,072) 13,023,183
NET INCREASE (DECREASE) IN NET ASSETS RESULTING 10,683,562 22,197,492
FROM OPERATIONS
Distributions to shareholders (10,529,224) (11,515,316)
From net interest income
From net realized gain (21,363) -
TOTAL DISTRIBUTIONS (10,550,587) (11,515,316)
Share transactions 39,821,256 78,520,810
Net proceeds from sales of shares
Reinvestment of distributions 7,831,793 8,004,086
Cost of shares redeemed (63,417,542) (92,564,366)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING (15,764,493) (6,039,470)
FROM SHARE TRANSACTIONS
TOTAL INCREASE (DECREASE) IN NET ASSETS (15,631,518) 4,642,706
NET ASSETS
Beginning of period 221,548,797 216,906,091
End of period (including undistributed net interest $ 205,917,279 $ 221,548,797
income of $0 and $19,929, respectively)
OTHER INFORMATION
Shares
Sold 3,919,804 7,754,730
Issued in reinvestment of distributions 769,082 790,944
Redeemed (6,240,464) (9,155,320)
Net increase (decrease) (1,551,578) (609,646)
</TABLE>
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
YEAR ENDED YEAR ENDED YEARS ENDED FEBRUARY TEN MONTHS
FEBRUARY FEBRUARY 28, ENDED
28, 29, FEBRUARY
28,
1997 1996 1995 1994 D 1993
SELECTED PER-SHARE DATA
Net asset value, beginning $ 10.330 $ 9.840 $ 10.740 $ 11.030 $ 10.100
of period
Income from Investment .524 .517 .558 .589 .492
Operations
Net interest income
Net realized and unrealized .022 .489 (.730) (.090) .930
gain (loss)
Total from investment .546 1.006 (.172) .499 1.422
operations
Less Distributions
From net interest income (.525) (.516) (.558) (.589) (.492)
From net realized gain (.001) - (.170) (.200) -
Total distributions (.526) (.516) (.728) (.789) (.492)
Net asset value, end $ 10.350 $ 10.330 $ 9.840 $ 10.740 $ 11.030
of period
TOTAL RETURN B 5.49% 10.46% (1.30)% 4.59% 14.48%
RATIOS AND SUPPLEMENTAL
DATA
Net assets, end of period $ 205,917 $ 221,549 $ 216,906 $ 291,760 $ 274,872
(000 omitted)
Ratio of expenses to average .60% .60% .59% .48% .63% A
net assets C
Ratio of net interest income to 5.00% 5.31% 5.71% 5.31% 5.72% A
average net assets
Portfolio turnover rate 16% 49% 32% 60% 27% A
</TABLE>
A ANNUALIZED
B TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED. THE
TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN.
C FMR AGREED TO REIMBURSE A PORTION OF THE EXPENSES DURING THE PERIOD.
WITHOUT THIS REIMBURSEMENT, THE FUND'S EXPENSE RATIO WOULD HAVE BEEN
HIGHER.
D EFFECTIVE MARCH 1, 1993, THE FUND ADOPTED STATEMENT OF POSITION 93-2,
"DETERMINATION, DISCLOSURE, AND FINANCIAL STATEMENT PRESENTATION OF INCOME,
CAPITAL GAIN, AND RETURN OF CAPITAL DISTRIBUTIONS BY INVESTMENT COMPANIES."
AS A RESULT, NET INTEREST INCOME PER SHARE MAY REFLECT CERTAIN
RECLASSIFICATIONS RELATED TO BOOK TO TAX DIFFERENCES.
FIDELITY CALIFORNIA MUNICIPAL MONEY MARKET FUND
PERFORMANCE: THE BOTTOM LINE
To measure a money market fund's performance, you can look at either total
return or yield. Total return reflects the change in the value of an
investment, assuming reinvestment of the fund's dividend income. Yield
measures the income paid by a fund. Since a money market fund tries to
maintain a $1 share price, yield is an important measure of performance. If
Fidelity had not reimbursed certain fund expenses, the past 10 year total
returns would have been lower.
<TABLE>
<CAPTION>
<S> <C> <C> <C>
CUMULATIVE TOTAL RETURNS
PERIODS ENDED FEBRUARY 28, 1997 PAST 1 PAST 5 PAST 10
YEAR YEARS YEARS
Fidelity 2.90% 13.80% 43.53%
California Municipal Money Market
California Tax-Free 2.87% 13.70% 43.57%
Money Market Funds Average
</TABLE>
CUMULATIVE TOTAL RETURNS show the fund's performance in percentage terms
over a set period - in this case, one year, five years or 10 years. For
example, if you invested $1,000 in a fund that had a 5% return over the
past year, the value of your investment would be $1,050. To measure how the
fund's performance stacked up against its peers, you can compare it to the
California tax-free money market funds average, which reflects the
performance of 46 California tax-free money market funds with similar
objectives tracked by IBC Financial Data, Inc. over the past one year. (the
periods covered by the IBC Financial Data, Inc. numbers are the closest
available match to those covered by the fund.)
AVERAGE ANNUAL TOTAL RETURNS
<TABLE>
<CAPTION>
<S> <C> <C> <C>
PERIODS ENDED FEBRUARY 28, 1997 PAST 1 PAST 5 PAST 10
YEAR YEARS YEARS
Fidelity 2.90% 2.62% 3.68%
California Municipal Money Market
California Tax-Free 2.87% 2.60% 3.68%
Money Market Funds Average
</TABLE>
AVERAGE ANNUAL TOTAL RETURNS take the fund's cumulative return and show you
what would have happened if the fund had performed at a constant rate each
year.
YIELDS
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
3/3/97 12/2/96 9/2/96 6/3/96 2/26/96
California Municipal 2.77% 2.93% 2.92% 3.09% 2.76%
Money Market
California Tax-Free 2.74% 2.95% 2.84% 2.95% 2.76%
Money Market Funds
Average
California Tax-Free 4.77% 5.05% 5.03% 5.32% 4.75%
Money Market Tax-equivalen
t
</TABLE>
Row: 1, Col: 1, Value: 2.77
Row: 1, Col: 2, Value: 2.74
Row: 2, Col: 1, Value: 2.93
Row: 2, Col: 2, Value: 2.95
Row: 3, Col: 1, Value: 2.92
Row: 3, Col: 2, Value: 2.84
Row: 4, Col: 1, Value: 3.09
Row: 4, Col: 2, Value: 2.95
Row: 5, Col: 1, Value: 2.76
Row: 5, Col: 2, Value: 2.76
4% -
3% -
2% -
1% -
0%
California Municipal
Money Market
California
Tax-Free Money
Market Funds Average
YIELD refers to the income paid by the fund over a given period. Yields for
money market funds are usually for seven-day periods, expressed as annual
percentage rates. A yield that assumes income earned is reinvested or
compounded is called an effective yield. The chart above shows the fund's
seven-day yield at quarterly intervals over the past year. You can compare
these yields to the California tax-free money market funds average as
tracked by IBC Financial Data, Inc. Or you can look at the fund's
tax-equivalent yield, which is based on a combined effective 1997 federal
and state income tax rate of 41.95%. A portion of the fund's income may be
subject to the alternative minimum tax.
A MONEY MARKET FUND'S TOTAL RETURNS AND YIELDS WILL VARY, AND REFLECT PAST
RESULTS RATHER THAN PREDICT FUTURE PERFORMANCE.
COMPARING
PERFORMANCE
Yields on tax-free
investments are usually lower
than yields on taxable
investments. However, a
straight comparison between
the two may be misleading
because it ignores the way
taxes reduce taxable returns.
Tax-equivalent yield - the
yield you'd have to earn on a
similar taxable investment to
match the tax-free yield -
makes the comparison more
meaningful. Keep in mind that
the U.S. government neither
insures nor guarantees a
money market fund. And
there is no assurance that a
money market fund will
maintain a $1 share price.
(checkmark)
FIDELITY CALIFORNIA MUNICIPAL MONEY MARKET FUND
FUND TALK: THE MANAGER'S OVERVIEW
NOTE TO SHAREHOLDERS: Diane McLaughlin became Portfolio Manager of Fidelity
California Municipal Money Market Fund on August 1, 1996.
(Portfolio Manager: Diane McLaughlin photograph)
Q. DIANE, WHAT WAS THE INVESTMENT ENVIRONMENT LIKE OVER THE PAST YEAR?
A. Just prior to the beginning of the period in March 1996, market
sentiment had shifted from a fear of recession to a fear that the economy
might be expanding too rapidly. Accordingly, investors began expecting the
Federal Reserve Board to increase the rate banks charge each other for
overnight loans - the fed funds target rate - to head off possible
inflation. As it turned out, the Fed held steady for over a year, keeping
the fed funds target rate at 5.25% since February of last year. While the
economy ended 1996 on a fairly strong note, economic data released in
January suggested that the economy was proceeding at a more moderate pace.
More importantly, inflation pressures didn't materialize, vindicating the
Fed's decision to leave policy unchanged. However, the Fed had expressed
concern about tightness in the labor market and the potential upward
pressure low unemployment might exert on the economy's core inflation.
Further, the Fed has indicated a bias toward raising interest rates to keep
inflation at bay. By February, the market had grown complacent with steady
policy, but during the final days of the month Fed Chairman Alan
Greenspan's semiannual testimony before Congress caused a shift in market
sentiment. Mentioning the possibility of raising rates before price
pressure flows through to the consumer - a pre-emptive tightening - his
comments reinforced the increased probability of a near-term increase in
the fed funds target rate, causing an increase in rates in the short end of
the taxable market.
Q. WHAT KIND OF STRATEGY DID YOU PURSUE WITH THE FUND OVER THE PAST SIX
MONTHS?
A. In anticipation of higher rates, my investment focus remained on the
short end of the yield curve. My purchases were concentrated in variable
rate instruments and three-month commercial paper. This conservative
strategy resulted in the fund's maturity declining considerably from the
mid 50-day range to 38 days at the end of the period. I have been able to
take advantage of technicals - supply and demand trends - unique to the
municipal short-term market. In periods of little demand, municipal money
market rates rise relative to taxable securities with comparable
maturities. I have tried to anticipate these periods to position the fund
to buy at higher yields, and I've selectively purchased attractive
longer-term securities during these times. In addition, although the fed
funds target rate has held steady, short-term rates have been volatile.
Yields have risen as the market has digested strong economic data and have
fallen as indicators reflect mild inflation. This volatility has provided
trading opportunities for the fund.
Q. HOW DID THE FUND PERFORM?
A. The fund's seven-day yield on February 28, 1997, was 2.76%, the same as
it was 12 months ago. The latest yield was the equivalent of a 4.75%
taxable rate of return for California investors in the 41.95% combined
state and federal income tax bracket. Through February 28, 1997, the fund's
12-month total return was 2.90%, compared to 2.87% for the California
tax-free money market funds average, according to IBC Financial Data, Inc.
Q. WHAT'S YOUR OUTLOOK?
A. There is a risk that the economy's moderate strength may become more
robust, causing inflation pressures to build and possibly leading to an
upward trend in interest rates. Furthermore, seasonal outflows caused by
individual tax payments on April 15 are expected to cause yields to rise on
short-term municipal money market instruments. That being said, the fund's
average maturity should trend downward since there is virtually no new
issuance scheduled over the next few months. I'll continue to look for
trading opportunities, but intend to try to keep
the fund's average maturity close to 40 days, which will enable me to
extend the fund's average maturity if rates do increase.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO MANAGER
ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON THE COVER.
THE MANAGER'S VIEWS ARE SUBJECT TO CHANGE AT ANY TIME BASED ON MARKET AND
OTHER CONDITIONS.
FUND FACTS
GOAL: high current tax-free
income for California residents
while maintaining a stable
$1.00 share price
FUND NUMBER: 097
TRADING SYMBOL: FCFXX
START DATE: July 7, 1984
SIZE: as of February 28, 1997,
more than $819 million
MANAGER: Diane McLaughlin,
since August 1996; manager,
various Fidelity and Spartan
municipal money market
funds; joined Fidelity in 1992
(checkmark)
FIDELITY CALIFORNIA MUNICIPAL MONEY MARKET FUND
INVESTMENT CHANGES
MATURITY DIVERSIFICATION
DAYS % OF FUND ASSETS % OF FUND ASSETS % OF FUND ASSETS
2/28/97 8/31/96 2/29/96
0 - 30 73 71 66
31 - 90 4 11 8
91 - 180 21 3 19
181 - 397 2 15 7
WEIGHTED AVERAGE MATURITY
2/28/97 8/31/96 2/29/96
Fidelity California Municipal
Money Market Fund 38 days 63 days 52 days
California Tax-Free
Money Market Funds
Average* 40 days 52 days 42 days
ASSET ALLOCATION (% OF FUND'S INVESTMENTS)
AS OF FEBRUARY 28, 1997 AS OF AUGUST 31, 1996
Row: 1, Col: 1, Value: 65.0
Row: 1, Col: 2, Value: 12.0
Row: 1, Col: 3, Value: 2.0
Row: 1, Col: 4, Value: 21.0
Row: 1, Col: 5, Value: 0.0
Row: 1, Col: 1, Value: 68.0
Row: 1, Col: 2, Value: 9.0
Row: 1, Col: 3, Value: 4.0
Row: 1, Col: 4, Value: 17.0
Row: 1, Col: 5, Value: 2.0
Variable rate
demand notes
(VRDNs) 66%
Commercial
paper 12%
Tender bonds 1%
Municipal
notes 21%
Other 0%
Variable rate
demand notes
(VRDNs) 68%
Commercial
paper 9%
Tender bonds 4%
Municipal
notes 17%
Other 2%
* SOURCE: IBC'S MONEY FUND REPORT (registered trademark)
FIDELITY CALIFORNIA MUNICIPAL MONEY MARKET FUND
INVESTMENTS FEBRUARY 28, 1997
Showing Percentage of Total Value of Investments in Securities
<TABLE>
<CAPTION>
<S> <C> <C>
MUNICIPAL SECURITIES (A) - 100%
PRINCIPAL VALUE
AMOUNT (NOTE 1)
CALIFORNIA - 100.0%
Alameda County Ind. Dev. Auth. Ind. Rev. VRDN:
Rfdg. (Longview Fibre Co.) Series 1988, 3.45%,
LOC ABN-AMRO Bank, VRDN $ 1,750,000 $ 1,750,000
(Edward L. Shimmon Inc. Proj.) Series 1996 A,
3.30%, LOC Banque Nationale De Paris (b) 2,100,000 2,100,000
Alameda County TRAN 4.50% 6/30/97 2,000,000 2,003,507
Anaheim Hsg. Auth. Multi-Family Hsg. Rev. (Parka
Vista Apts) 3.30%, LOC Citibank, VRDN (b) 6,200,000 6,200,000
Azusa Multi-Family Hsg. Rev. (Pacific Glen Apt.
Proj.) Series 1994, 3.50%, VRDN 3,200,000 3,200,000
Barstow Multi-Family Hsg. Rev. (Rimrock Village Apt.
Proj.) Series 1996, 3.30%, LOC Federal Home Loan
Bank, VRDN (b) 1,650,000 1,650,000
Berkeley TRAN 4.50% 8/13/97 2,800,000 2,807,298
Butte County Office of Ed. TRAN 4.50% 8/20/97 4,400,000 4,411,362
California Dept. Of Wtr. Resources Participating
VRDN, Series PA-133, 3.25% (Liquidity Facility
Merrill Lynch & Co.) (c) 1,000,000 1,000,000
California Econ. Dev. Fin. Auth. Ind. Dev. Rev.
(Volk Enterprises) Series 1996, 3.20%,
LOC Harris Trust & Savings, VRDN 2,000,000 2,000,000
California Econ. Dev. Fin. Auth. Rev.
(Joseph Schmidt Proj.) Series A, 3.30%,
LOC Banque Nationale De Paris, VRDN (b) 1,000,000 1,000,000
California Gen. Oblig.:
Bonds:
Series 96C0502, 3.35%, tender 3/15/97
(AMBAC Insured) (Liquidity Facility Citibank) (c) 7,600,000 7,600,000
CP:
3.35% 3/10/97 3,000,000 3,000,000
3.45% 3/11/97 1,300,000 1,300,000
3.40% 3/12/97 3,225,000 3,225,000
3.45% 3/21/97 9,000,000 9,000,000
3.40% 4/9/97 2,500,000 2,500,000
Participating VRDN (c): 2,100,000 2,100,000
Series SG-84, 3.35%
(Liquidity Facility Society Generale)
Series SG-85, 3.35%
(Liquidity Facility Society Generale, France) 3,700,000 3,700,000
Series 1996 L, 3.40% (FGIC Insured)
(Liquidity Facility Caisse des Depots et
Consignations) 7,800,000 7,800,000
RAN:
Series 1996-97, 4.50% 6/30/97 32,875,000 32,954,780
3.504% 6/30/97 7,000,000 7,000,000
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
CALIFORNIA - CONTINUED
California Hsg. Fin. Agcy. Mtg. Rev. Bonds
Series 1996-J, 4%, tender 7/24/97 (FGIC Insured) $ 1,025,000 $ 1,025,000
California Hsg. Fin. Agcy. Participating VRDN (c):
Series C1, 3.40% (Liquidity Facility Bank of
America) (b) 3,225,000 3,225,000
Series PT-40A, 3.45%
(Liquidity Facility Commerzbank) (b) 6,700,000 6,700,000
Series PT-40B, 3.45%
(Liquidity Facility Bayerische Hypotheken) (b) 9,000,000 9,000,000
Series PT-40C, 3.25%
(Liquidity Facility Banque Nationale de Paris) 6,720,000 6,720,000
Series PT-40D, 3.45%
(Liquidity Facility Banque Nationale de Paris) (b) 60,000 60,000
Series PA-112, 3.45%
(MBIA Insured)(Liquidity Facility Merrill Lynch &
Co.) (b) 2,500,000 2,500,000
Series PT-14, 3.25%
(Liquidity Facility Commerzbank, Germany) 4,975,000 4,975,000
Series PT-56, 3.45%
(Liquidity Facility Credit Suisse) (b) 1,180,000 1,180,000
Series PA-90, 3.45% 2/15/18
(Liquidity Facility Merrill Lynch) (b) 2,105,000 2,105,000
Series 1994-1, 3.45%
(Liquidity Facility State Street Bank) (b)(c) 8,515,179 8,515,179
Series 1994 H, 3.45%
(AMBAC Insured) (Liquidity Facility Citibank)
(b)(c) 4,000,000 4,000,000
California Poll. Cont. Fin. Auth. Resource Recovery
Rev. (Burney Forest Prod. Proj.) 3.35%,
LOC Nat'l. Westminster Bank, VRDN 2,000,000 2,000,000
California Poll. Cont. Fin. Auth. Rev.:
Bonds:
(Chevron USA, Inc. Proj.) Series 1983,
3.90%, tender 11/15/97 1,000,000 1,001,377
(Pacific Gas & Elec. Co.):
Series 1996 B, 3.40%, tender 3/20/97,
LOC Morgan Guaranty Trust 7,100,000 7,100,000
Series 1996 E:
3.55%, tender 3/7/97,
LOC Morgan Guaranty Trust, NY 2,400,000 2,400,000
3.45%, tender 3/10/97,
LOC Morgan Guaranty Trust, NY 1,800,000 1,800,000
3.45%, tender 4/8/97,
LOC Morgan Guaranty Trust, NY 1,300,000 1,300,000
(Southern California Edison Co.) Series 1985 D,
3.25%, tender 3/18/97 1,200,000 1,200,000
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
CALIFORNIA - CONTINUED
California Poll. Cont. Fin. Auth. Rev.: - continued
VRDN:
(Pacific Gas & Elec. Co.):
Series 1996 A, 3.30%, LOC Swiss Bank
Corp. (b) $ 39,700,000 $ 39,700,000
Series 1996 B, 3.25%, LOC Rabobank Nederland (b) 5,000,000 5,000,000
Series 1996 C, 3.40%, LOC Bank of America 2,800,000 2,800,000
Series 1996 F, 3.35%, LOC Banque Nationale de
Paris 1,500,000 1,500,000
Series 1996 G, 3.45% 2,200,000 2,200,000
(Shell Oil Corp. - Martinez Proj.) Series 1994 B,
3.40% 3,000,000 3,000,000
(Southern California Edison Proj.):
Series 1986 A, 3.45% 700,000 700,000
Series 1986 B, 3.45% 600,000 600,000
Seried 1986 D, 3.45% 3,900,000 3,900,000
California Poll. Cont. Fin. Auth. Solid Waste Disp.
Rev. VRDN:
(Athens Disp. Co. Proj.) Series 1995, 3.35%,
LOC Wells Fargo Bank of San Francisco (b) 2,000,000 2,000,000
(EDCO Disposal) Series 1996-A,3.35%,
LOC Wells Fargo Bank 3,500,000 3,500,000
(Gilton Solid Waste Mgmt. Inc. Proj.) Series 1995 A,
3.30%, LOC Bank of America (b) 2,700,000 2,700,000
(Sanifill Inc. Proj.) Series 1995 A, 3.30%,
LOC California St. Teachers Retirement Sys. (b) 3,000,000 3,000,000
(Shell Oil Co. Martinez Proj.) Series 1994 S,
3.40% (b) 6,100,000 6,100,000
Series 1996 A, 3.50%, LOC Sanwa Bank Ltd. (b) 1,650,000 1,650,000
California School Cash Reserves Prog. Auth. TRAN
Series 1996 A, 4.75% 7/2/97 12,100,000 12,137,810
California Statewide Commty. Dev. Auth. Apt. Dev.
Rev. Rfdg. Series 1995 A-7, 3.30%
(FNMA Guaranteed) VRDN (b) 5,000,000 5,000,000
California Statewide Commty. Dev. Auth.
Multi-Family Hsg. Rev. VRDN:
(Canyon Creek Apts.) Series 1995 C, 3.25%
(FNMA Guaranteed) (b) 700,000 700,000
(Evapco, Inc.) Series 1996 K, 3.40%,
LOC Nations Bank (b) 1,500,000 1,500,000
California Statewide Commty. Dev. Auth. Enterprise
Zone Facs. Rev. (JTF Enterprises, LLC Proj.)
Series 1996 A, 3.35%, LOC Bank of America 3,000,000 3,000,000
California Statewide Commty. Dev. Auth. Ind. Dev.
Rev. VRDN:
(Carvin Corp.) 3.30%,
LOC California State Teachers Retirement Sys. (b) 435,000 435,000
(Cordeiro Vault Co., Inc. Proj.) Series 1996 M,
3.30%, LOC California Teachers Retirement Sys. (b) 1,130,000 1,130,000
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
CALIFORNIA - CONTINUED
California Statewide Commty. Dev. Auth. Ind.
Dev. Rev. VRDN: - continued
(Peets Coffee & Tea Inc.) Series 1995 E, 3.30%,
LOC California St. Teacher Retirement Sys. (b) $ 2,200,000 $ 2,200,000
(Santa Cruz-Wilson Entities Ltd. Proj.) Series
1993, 3.30%, LOC Bank of Tokyo (b) 1,300,000 1,300,000
(Veriflo Corp. Proj.) Series 1996 C, 3.30%,
LOC ABN-AMRO (b) 1,900,000 1,900,000
(W&H Voortman Inc. Proj.) Series 1990, 3.30%,
LOC California Teachers Retirement Sys. (b) 1,005,000 1,005,000
California Statewide Commty. Dev. Auth. Rev. VRDN:
(Andercraft Prod. Inc.) Series 1989, 3.30%,
LOC California Teachers Retirement Sys. (b) 605,000 605,000
(Covenant Retirement Commty. Inc.):
Series 1995, 3.25%, LOC LaSalle Bank 4,000,000 4,000,000
3.25%, LOC Lasalle Nat'l. Bank 10,300,000 10,300,000
(Eurodesign Cabinets Inc. Proj.) 3.30%,
LOC California Teachers Retirement Sys. (b) 1,000,000 1,000,000
(Fibrebond West Inc. Proj.) Series 1996 N, 3.30%,
LOC California State Teachers Retirement Sys. (b) 2,000,000 2,000,000
(Florestone Prod. Co.) Series 1989, 3.30%,
LOC Bank of Tokyo (b) 880,000 880,000
(Fulton Properties Ltd, Inc.) Series 1996 F, 3.40%
LOC Wells Fargo Bank (b) 3,625,000 3,625,000
(Instrument Specialties Co.) Series 1989,
3.30%, LOC California Teachers Retirement Sys. (b) 925,000 925,000
(J. Michelle of California/Edie Lee Inc.) 3.30%,
LOC California Teachers Retirement Sys. (b) 1,325,000 1,325,000
(Kaiser Foundation Hosp.) Series 1995, 3.20% 4,700,000 4,700,000
(Lansmont Corp. Proj.) Series 1996 G, 3.40%,
LOC Wells Fargo Bank (b) 1,000,000 1,000,000
(Leegin Creative Leather Prod.) Series 1995 A,
3.30%, LOC California St. Teachers Retirement
Sys. (b) 1,715,000 1,715,000
(Lorber Ind. of California Proj.) Series 1992,
3.40%, LOC Union Bank 1,120,000 1,120,000
(Marcel & Margrit Shurman Proj.) 3.30% (b) 1,655,000 1,655,000
(Northern California Retired Officers Commty.)
3.35%, LOC Dresdner Bank 700,000 700,000
(Northwest Pipe & Casing Co. Proj.)Series 1990,
3.30%, LOC California Teacher Retirement Sys. (b) 3,500,000 3,500,000
(Redline Synthetic Oil Corp.) 3.30%,
LOC California Teachers Retirement Sys. (b) 1,095,000 1,095,000
(Setton Prop. Inc. Proj.) Series 1995 E, 3.40%,
LOC Wells Fargo Bank of San Francisco (b) 2,890,000 2,890,000
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
CALIFORNIA - CONTINUED
California Statewide Commty. Dev. Auth. Rev. VRDN: - continued
(Zarn Inc. Proj.) Series 1989, 3.30%,
LOC California Teacher Retirement Sys. (b) $ 1,175,000 $ 1,175,000
(Zieman Manufacturing Co. Proj.) Series 1990,
3.30%, LOC California St. Teacher Retirement
Sys. (b) 490,000 490,000
Camarillo Multi-Family Hsg. Rev.
(Hacienda de Camarillo Proj.) Series 1996,
3.25% (FNMA Guaranteed) VRDN (b) 5,900,000 5,900,000
Carlsbad Hsg. & Redev. Multi-Family Hsg. Rev.
(Seascape Village Proj.) Series A, 3.45%, VRDN 10,600,000 10,600,000
Chula Vista Ind. Dev. Rev. (San Diego Gas & Elec.
Co.) (b):
VRDN Series B:
3.35% 2,000,000 2,000,000
3.60% 3,600,000 3,600,000
Bonds:
Series C:
3.55%, tender 3/24/97 1,000,000 1,000,000
3.50%, tender 6/16/97 5,000,000 5,000,000
Series D:
3.50%, tender 3/10/97 2,000,000 2,000,000
3.55%, tender 3/7/97 1,500,000 1,500,000
Series E, 3.55%, tender 3/11/97 2,500,000 2,500,000
Concord Multi-Family Mtg. Rev. (Crossroads Apts.)
Series 1988 B, 3.20%, (FNMA Guaranteed) VRDN 1,900,000 1,900,000
Contra Costa County Wtr. Dist. Participating VRDN,
Series SGA-24, 3.20%
(Liquidity Facility Societe Generale) (c) 11,100,000 11,100,000
Covina Redev. Agcy. Multi-Family Hsg. Rev.
(Shadowhills Apt. Proj.) Series 1994 A, 3.50%, VRDN 500,000 500,000
East Bay Muni. Util. Dist. (Wtr & Swr. Proj.) Series
1988 CP:
3.45% 3/27/97 (Liquidity Facility Westdeutsche
Landesbank) 6,000,000 6,000,000
3.30% 4/11/97
(Liquidity Facility Westdeutsche Landesbank) 1,600,000 1,600,000
Emeryville Redev. Agcy. Multi-Family Hsg.
(Emery Bay Apts. II) 3.30%,
LOC Bank of America, VRDN (b) 3,000,000 3,000,000
Escondido Commty. Dev. Commission Rev.
(Escondido Promeneade Proj.) 3.30%,
LOC Bank of America, VRDN (b) 4,000,000 4,000,000
Fowler Ind. Dev. Auth. Ind. Dev. Rev.
(Bee Sweet Citrus Inc. Proj.) 3.40%,
LOC Bank of America, VRDN (b) 2,000,000 2,000,000
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
CALIFORNIA - CONTINUED
Fremont Multi-Family Hsg. Rev. (Treetops Apts.)
Series 1996 - A, 3.25% (FNMA Guaranteed)
VRDN (b) $ 3,300,000 $ 3,300,000
Fremont (Alameda County) TRAN Series 1996,
4.50% 7/1/97 3,500,000 3,506,182
Fremont Unified School Dist. TRAN Series 1996,
4.625% 7/1/97 3,300,000 3,307,253
Fresno County TRAN:
4.50% 6/30/97 1,500,000 1,502,870
4.75% 9/29/97 3,800,000 3,823,826
Garden Grove Hsg. Auth. Multi-Family Hsg. Rev.
(Valley View Sr. Villas Proj.) Series1990 A, 3.35%,
LOC Wells Fargo Bank, VRDN (b) 1,500,000 1,500,000
Huntington Beach Multi-Family Hsg. (Five Point
Seniors Proj.) Series 1991 A,
3.25%, LOC Wells Fargo Bank, VRDN (b) 6,400,000 6,400,000
Irvine Ranch Wtr. Dist. Rev. Series 1985 C,
3.35%, LOC Sumitomo Bank Ltd., VRDN 3,200,000 3,200,000
Irvine Wtr. Dist. Series 1991, 3.35%,
LOC Natwest Group, VRDN 1,200,000 1,200,000
Kern County TRAN 4.50% 10/2/97 3,500,000 3,516,880
Lassen Muni. Util. Dist. Rev. Rfdg. Series 1996 A,
3.40% (FSA Insured) (Liquidity Facility Credit
Local De France), VRDN (b) 3,500,000 3,500,000
Livermore Ctfs. of Prtn. (Reverse Osmosis Proj.)
3.25%, LOC Nat'l. Westminster Bank 1,700,000 1,700,000
Long Beach Harbour Dept. CP Series A (b):
3.30% 3/11/97 1,300,000 1,300,000
3.45% 3/11/97 2,900,000 2,900,000
Long Beach Harbor Participating VRDN,
Series SG-73, 3.35%
(Liquidity Facility Societe Generale) (b)(c) 3,000,000 3,000,000
Los Angeles Commty. College Dist. TRAN Series
1996-97, 4.50% 7/1/97 1,100,000 1,101,764
Los Angeles Commty. Redev. Agcy. Multi-Family Hsg.
Rev. (Promenade Towers) 3.25%, LOC Tokai Bank,
VRDN 12,000,000 12,000,000
Los Angeles Convention & Exhibit Ctr. Auth.
Participating VRDN, Series PA-1006, 3.25% (MBIA
Insured) (Liquidity Facility Merrill Lynch) (c) 565,000 565,000
Los Angeles County Dev. Auth. (Caitac & Jae Proj.),
3.40%, LOC Union Bank, VRDN (b) 1,500,000 1,500,000
Los Angeles County Metropolitan Trans. Auth
Participating VRDN (c):
Series SG-54, 3.25% (AMBAC Insured)
(Liquidity Facility Societe Generale) 6,500,000 6,500,000
Series SG-B2, 3.30% (Liquidity Facility Societe
Generale) 6,550,000 6,550,000
Series SG-B3, 3.30% (Liquidity Facility Societe
Generale) 5,200,000 5,200,000
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
CALIFORNIA - CONTINUED
Los Angeles County Multi-Family Hsg. Rev. VRDN:
(Malibu Meadows Proj.) Series 1991 A,
3.35%, LOC Sumitomo Bank Ltd. $ 9,011,000 $ 9,011,000
(Malibu Meadows II Proj.) Series 1991 B,
3.35%, LOC Sumitomo Bank Ltd. 1,800,000 1,800,000
(Meadowridge Apt. Proj.) Series 1994 B, 3.50% 1,400,000 1,400,000
Los Angeles County TRAN Series 1996-97,
4.50% 6/30/97 23,945,000 24,009,134
Los Angeles Dept. of Wtr. & Pwr. Elec. Plant CP:
3.40% 5/8/97 3,000,000 3,000,000
3.40% 5/12/97 3,000,000 3,000,000
3.40% 6/12/97 2,500,000 2,500,000
Los Angeles Harbor Dept. Participating VRDN (b) (c):
Series SG-59, 3.35% (Liquidity Facility Societe
Generale) (MBIA Insured) 4,725,000 4,725,000
Series 1996 B, BPA 3.45% Bank of New York 11,185,000 11,185,000
Los Angeles Multi-Family Hsg. Rev. (Beverly Park
Apts.) Series 1988 A, 3.25%, LOC Chase Manhattan
Bank, VRDN (b) 5,000,000 5,000,000
Los Angeles Ontario Intl. Arpt. Participating VRDN,
Series SG-61, 3.35%
(Liquidity Facility Societe Generale) (c) 1,400,000 1,400,000
Los Angeles TRAN Series 1996, 4.50% 6/19/97 15,500,000 15,527,795
Los Angeles Unified School Dist. TRAN:
Series 1996-97 A, 4.50% 6/30/97 4,450,000 4,459,535
Series 1996-97 B, 4.50% 9/30/97 1,000,000 1,005,484
Los Angeles Wastewtr. Participating VRDN,
Series 1996 SGA 26, 3.20%
(Liquidity Facility Societe Generale) (c) 1,000,000 1,000,000
Los Angeles Wastewtr. Sys. 3.40% 4/8/97 CP 3,600,000 3,600,000
Los Angeles Wtr. Pwr. Elec. Plant Participating
VRDN (c)
Series PA-121, 3.25%
(Liquidity Facility Merrill Lynch & Co.) 2,000,000 2,000,000
Series PA-141, 3.25%
(Liquidity Facility Merrill Lynch & Co.) 2,600,000 2,600,000
Metropolitan Water Dist CP:
Series A, 3.30% 4/11/97 1,000,000 1,000,000
Series B:
3.45% 3/11/97
(Liquidity Facility Westdeutsche Landesbank) 2,000,000 2,000,000
3.40% 4/10/97
(Liquidity Facility Westdeutsche Landesbank) 1,500,000 1,500,000
3.40% 4/11/97
(Liquidity Facility Westdeutsche Landesbank) 3,000,000 3,000,000
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
CALIFORNIA - CONTINUED
Monterey Ind. Dev. Auth. Rev. (Slautterback Corp. Proj.)
Series 1996 A, 3.30%,
LOC Bayerische Vereinsbank, VRDN (b) $ 1,350,000 $ 1,350,000
Moreno Valley Unified School Dist. TRAN 4.50%
6/30/97 2,000,000 2,003,185
North County Schools Fing. Auth. TRAN 4.75% 7/1/97 1,500,000 1,502,886
Oakland TRAN Series 1996, 4.75% 6/30/97 2,000,000 2,005,551
Oakland Unified School Dist. TRAN (Alameda County)
Series 1996-97, 4.25% 10/14/97 2,400,000 2,407,543
Oceanside Multi-Family Rev. (Lakeridge Apt. Proj.)
Series 1994, 3.50%, VRDN 6,700,000 6,700,000
Ontario Ind. Dev. Auth. Rev. (Safari Land Proj.)
Series 1989, 3.30%, LOC Bank of America, VRDN (b) 800,000 800,000
Orange County Apt. Dev. Participating VRDN (c):
Series JT 1996 A, 3.45%, LOC Citibank (b) 6,100,000 6,100,000
Series JP 1996 B, 3.35%, LOC Citibank 6,700,000 6,700,000
Orange County Apt. Dev. Rev. VRDN:
Rfdg. (Harbor Pointe Apts.) Series 1992 D, 3.25%,
LOC Citibank 4,400,000 4,400,000
(Alicia Viego Proj.) Issue 1986 A, 3.45%,
LOC Bank of Tokyo (b) 1,970,000 1,970,000
(Foothill Oaks Apts. Proj.) Series 1989 B, 3.50%,
LOC Bank of America (b) 700,000 700,000
(Hidden Hills) Series 1985 U-C, 3.30%,
LOC Tokai Bank Ltd 7,300,000 7,300,000
(Monarch Bay Apt. Proj.) Series 1985 T, 3.30%,
LOC Mitsubishi Bank Ltd 2,200,000 2,200,000
(Niguel Summit I) Series 1985 U-A, 3.30%,
LOC Chase Manhattan Bank 4,200,000 4,200,000
(Niguel Summit II) Series 1985 U-B, 3.45%,
LOC Bank of America 1,200,000 1,200,000
(Vista Verde Apt. Proj.) Series 1988 A, 3.25%,
LOC Wells Fargo Bank of San Francisco (b) 4,200,000 4,200,000
(Wood Canyon Villas) Series 1991 B, 3.25%
LOC Bank of America (b) 1,000,000 1,000,000
(Yorba Linda Assoc.) Series 1985 D, 3.40%,
LOC Bank of Tokyo 1,500,000 1,500,000
Orange County Hsg. Auth. Apt. Dev. Rev. VRDN:
(Costa Mesa Partners) Series 1985-BB, 3.30%,
LOC Chase Manhattan Bank 13,500,000 13,500,000
(Lantern Pines Proj.-Frost Group) 3.30%,
LOC Bank of Tokyo, VRDN 3,750,000 3,750,000
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
CALIFORNIA - CONTINUED
Oxnard Redev. Agcy. Ctfs. of Prtn.
(Channel Islands Bus. Ctr. Proj.) 3.675%,
LOC Wells Fargo Bank of San Francisco, VRDN $ 3,195,000 $ 3,195,000
Paramount Unified School Dist. TRAN Series 1996,
4.50% 6/30/97 3,400,000 3,405,414
Pittsburg Multi-Family Hsg. Auth. Rev.
(Fountain Plaza Apt.) 3.30%, VRDN 8,400,000 8,400,000
Pleasant Hill Redev. Agcy. Multi-Family Hsg. Rev.
(Chateau III Proj.) Series 1996 A, 3.40%,
LOC Commerzbank, VRDN (b) 800,000 800,000
Riverside County School Dist. TRAN Series 1996-76,
4.625% 7/17/97 1,000,000 1,002,086
Riverside County TRAN 4.50% 6/30/97 5,600,000 5,614,141
Riverside Hsg. Auth. Multi-Family Hsg. Mtg. Rev.
(Mt. View Apts.) Series 1995, 3.30%,
LOC Federal Home Loan Bank of San Francisco, VRDN 2,400,000 2,400,000
Riverside Hsg. Auth. Multi-Family Hsg. Rev. VRDN:
(Polk Apt. Proj.) Series 1985 O, 3.40% 2,200,000 2,200,000
(Tyler Village Proj.) Series 1986A, 3.35%,
LOC Chase Manhattan Bank 3,060,000 3,060,000
(Victoria Springs Apts.) Series 1989 C, 3.35%,
LOC Bank of America (b) 2,500,000 2,500,000
Sacramento County Arpt. Sys. Participating VRDN,
Series SGA-33, 3.20%
(Liquidity Facility Societe Generale) (c) 3,100,000 3,100,000
Sacramento Muni. Util. Dist. Participating VRDN,
3.30% (Liquidity Facility Societe Generale) (c) 4,000,000 4,000,000
San Bernardino County Ind. Dev. Auth. Rev. VRDN:
(Mc Elroy Metal Mill Proj.) 3.30%, LOC California St.
Teacher Retirement Sys. (b) 800,000 800,000
(NRI, Inc.) 3.30%, LOC California St. Teacher
Retirement Sys. (b) 1,640,000 1,640,000
San Bernardino County Multi-Family Hsg. Rev.
(Alta park Apts.) 3.50%, LOC Sumitomo Bank, VRDN 1,700,000 1,700,000
San Bernardino County TRAN 4.50% 6/30/97,
LOC Landesbank Hessen-Thuringen/
Toronto Dominion Bank 5,200,000 5,214,793
San Diego County Reg'l. Trans. Sales Tax
Participating VRDN, Series BTP-185, 3.20%,
(Liquidity Facility Bankers Trust) (c) 3,000,000 3,000,000
San Diego County Wtr. Auth. Series 1, 3.50% 5/6/97
(Liquidity Facility Bayerische Landesbank) 2,000,000 2,000,000
San Diego Gas & Elec. Participating VRDN Series
1992 A, 3.35% (Liquidity Facility Bank of New
York) (c) 5,000,000 5,000,000
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
CALIFORNIA - CONTINUED
San Diego Hsg. Auth. Multi-Family Hsg. Rev. VRDN:
Rfdg. (Coral Pointe Apt. Proj.) Series 1993 A,
3.50% $ 3,265,000 $ 3,265,000
(Carmel Del Mar Apr. Proj.) Series 1993-E,
3.20%, LOC Citibank 3,000,000 3,000,000
(Paseo Point Apt.) Series 1994 A, 3.35%,
LOC Bank of Tokyo 4,700,000 4,700,000
San Diego Ind. Dev. Participating VRDN, Series 1997,
3.35% (Liquidity Facility Bank of New York) (c) 2,000,000 2,000,000
San Diego Ind. Dev. Rfdg. Bonds (San Diego Gas &
Elec. Co.):
Series 1995 A:
3.40%, tender 5/13/97 2,300,000 2,300,000
3.50%, tender 5/15/97 2,000,000 2,000,000
Series 1995 B, 3.40%, tender 4/21/97 2,300,000 2,300,000
San Francisco City & County Parking Auth.
Participating
VRDN, Series 1996 A,
3.25% (Liquidity Facility Bank of America) (c) 2,900,000 2,900,000
San Francisco City & County Participating VRDN (c):
Series 1996 AA1, 3.35% (Liquidity Facility Bank of
America) 3,775,000 3,775,000
Series 1996 AA2, 3.35% (Liquidity Facility Bank of
America) 2,240,000 2,240,000
San Jose Multi-Family Hsg. Rev. (Siena At
Renaissance) Series 1996 B, 3.30%, LOC Key Bank,
VRDN (b) 5,000,000 5,000,000
San Jose Redev. Agcy. Participating VRDN, Series
PA-42I, 3.25% (MBIA Insured) (Liquidity Facility
Merrill Lynch) (c) 3,400,000 3,400,000
San Luis Obispo County Office of Ed. TRAN Series
1996, 4.50% 10/9/97 4,285,000 4,302,562
San Luis Obispo County TRAN Series 1996-97,
4.50% 7/8/97 2,000,000 2,004,076
Santa Clara County Multi-Family Hsg. Rev.
(Garden Grove Apts.) 3.15% (FNMA Guaranteed) VRDN 2,600,000 2,600,000
Santa Clara County TRAN Series 1996-97, 4.50% 8/1/97 5,000,000 5,011,070
Santa Clara Unified School Dist. TRAN Series 1996,
4.50% 7/2/97 1,000,000 1,001,943
Simi Valley Multi-Family Hsg. Rev. VRDN:
(Lincoln Wood Ranch Apt.) 3.35%, LOC Sumitomo Bank 2,200,000 2,200,000
(Shadowridge Apts.) Series 1989, 3.30%, LOC
Citibank (b) 4,800,000 4,800,000
South Coast TRAN Series 1996, 4.75% 6/30/97 7,000,000 7,022,454
Southern California Pub. Pwr. Auth. Participating
VRDN (c):
Series BTP-90,
3.20% (Liquidity Facility Bankers Trust) 2,500,000 2,500,000
Series SG-35, 3.25% (Liquidity Facility Societe
Generale) 7,300,000 7,300,000
Stanislaus County Office of Ed. TRAN Series 1996,
4.50% 6/30/97 1,700,000 1,702,707
Stanislaus County TRAN 4.50% 7/1/97 6,100,000 6,111,163
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
CALIFORNIA - CONTINUED
Torrance Hospital Rev. (Little Co. of Mary Hosp.
- -Torrance Mem. Med. Ctr.) Series 1992, 3.25%,
LOC Fuji Bank Ltd., VRDN $ 2,500,000 $ 2,500,000
University of California Rev. CP:
Series A, 3.50% 5/9/97 1,500,000 1,500,000
3.30% 4/11/97 1,200,000 1,200,000
3.40% 7/15/97 7,500,000 7,500,000
Vista City Ind. Dev. Auth. Rev. (Desalination Sys.,
Inc.) Series 1995, 3.35%,
LOC Wells Fargo Bank of San Francisco, VRDN (b) 1,880,000 1,880,000
TOTAL INVESTMENTS - 100% $806,999,610
Total Cost for Income Tax Purposes $ 806,999,828
</TABLE>
SECURITY TYPE ABBREVIATIONS
CP - Commercial Paper
RAN - Revenue Anticipation Notes
TRAN - Tax and Revenue Anticipation Notes
VRDN - Variable Rate Demand Notes
LEGEND
(a) The coupon rate shown on floating or adjustable rate securities
represents the rate at period end.
(b) Private activity obligations whose interest is subject to the federal
alternative minimum tax for individuals.
(c) Provides evidence of ownership in one or more underlying bonds.
INCOME TAX INFORMATION
At February 28, 1997, the fund had a capital loss carryforward of
approximately $457,000 of which $446,000 and $11,000 will expire on
February 28, 2003 and 2005, respectively
During fiscal year ended 1997, 100% (unaudited) of the fund's income
dividends was free from federal income tax, and 27.44% (unaudited) of the
fund's income dividends was subject to the federal alternative minimum tax.
FIDELITY CALIFORNIA MUNICIPAL MONEY MARKET FUND
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
<S> <C> <C>
FEBRUARY 28, 1997
ASSETS
Investment in securities, at value - $ 806,999,610
See accompanying schedule
Cash 8,536,359
Interest receivable 7,245,923
TOTAL ASSETS 822,781,892
LIABILITIES
Payable for investments purchased $ 2,601,297
Distributions payable 45,551
Accrued management fee 260,317
Other payables and accrued expenses 170,104
TOTAL LIABILITIES 3,077,269
NET ASSETS $ 819,704,623
Net Assets consist of:
Paid in capital $ 820,159,799
Accumulated net realized gain (loss) on investments (455,176)
NET ASSETS, for 820,183,639 shares outstanding $ 819,704,623
NET ASSET VALUE, offering price and redemption price per $1.00
share ($819,704,623 (divided by) 820,183,639 shares)
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
<S> <C> <C>
YEAR ENDED FEBRUARY 28, 1997
INTEREST INCOME $ 25,747,654
EXPENSES
Management fee $ 2,929,149
Transfer agent, accounting and custodian fees and 1,637,720
expenses
Non-interested trustees' compensation 1,979
Registration fees 28,465
Audit 20,218
Legal 7,159
Miscellaneous 11,511
Total expenses before reductions 4,636,201
Expense reductions (103,299) 4,532,902
NET INTEREST INCOME 21,214,752
NET REALIZED GAIN (LOSS) ON INVESTMENTS (10,817)
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 21,203,935
</TABLE>
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
<S> <C> <C>
YEAR ENDED YEAR ENDED
FEBRUARY 28, FEBRUARY 29,
1997 1996
INCREASE (DECREASE) IN NET ASSETS
Operations $ 21,214,752 $ 23,161,505
Net interest income
Net realized gain (loss) (10,817) 140,195
Increase (decrease) in net unrealized gain from - (10,065)
accretion
of discount
NET INCREASE (DECREASE) IN NET ASSETS RESULTING 21,203,935 23,291,635
FROM OPERATIONS
Distributions to shareholders from net interest income (21,214,752) (23,161,505)
Share transactions at net asset value of $1.00 per share 2,802,872,804 2,557,400,271
Proceeds from sales of shares
Reinvestment of distributions from net interest income 20,627,708 22,361,567
Cost of shares redeemed (2,736,308,324) (2,522,553,562)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING 87,192,188 57,208,276
FROM SHARE TRANSACTIONS
TOTAL INCREASE (DECREASE) IN NET ASSETS 87,181,371 57,338,406
NET ASSETS
Beginning of period 732,523,252 675,184,846
End of period $ 819,704,623 $ 732,523,252
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
FINANCIAL HIGHLIGHTS
YEAR ENDED YEAR ENDED YEARS ENDED TEN MONTHS
FEBRUARY FEBRUARY 29, FEBRUARY 28, ENDED
28, FEBRUARY 28,
1997 1996 1995 1994 1993
SELECTED PER-SHARE DATA
Net asset value, beginning $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
of period
Income from Investment .029 .032 .026 .020 .019
Operations
Net interest income
Less Distributions
From net interest income (.029) (.032) (.026) (.020) (.019)
Net asset value, end of period $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
TOTAL RETURN B 2.90% 3.21% 2.60% 1.97% 1.92%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 819,705 $ 732,523 $ 675,185 $ 611,765 $ 568,280
(000 omitted)
Ratio of expenses to average .62% .64% .62% .64% .62%
net assets A
Ratio of expenses to average net .61% .64% .62% .64% .62%
assets after expense C A
reductions
Ratio of net interest income to 2.86% 3.17% 2.58% 1.95% 2.29%
average net assets A
</TABLE>
A ANNUALIZED
B TOTAL RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED. THE
TOTAL RETURN(S) WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN REDUCED
DURING THE PERIODS SHOWN.
C FMR OR THE FUND HAS ENTERED INTO VARYING ARRANGEMENTS WITH THIRD PARTIES
WHO EITHER PAID OR REDUCED A PORTION OF THE FUND'S EXPENSES (SEE NOTE 5 OF
NOTES TO FINANCIAL STATEMENTS).
NOTES TO FINANCIAL STATEMENTS
For the period ended February 28, 1997
1. SIGNIFICANT ACCOUNTING POLICIES.
Fidelity California Municipal Income Fund (the income fund) and Fidelity
Insured Municipal Income Fund (the insured fund) are funds of Fidelity
California Municipal Trust. Fidelity California Municipal Money Market Fund
(the money market fund) is a fund of Fidelity California Municipal Trust
II. Each trust is registered under the Investment Company Act of 1940, as
amended (the 1940 Act), as an open-end management investment company.
Fidelity California Municipal Trust and Fidelity California Municipal Trust
II (the trusts) are organized as a Massachusetts business trust and a
Delaware business trust, respectively. Each fund is authorized to issue an
unlimited number of shares. The financial statements have been prepared in
conformity with generally accepted accounting principles which permit
management to make certain estimates and assumptions at the date of the
financial statements. The following summarizes the significant accounting
policies of the income, insured and money market fund:
SECURITY VALUATION.
INCOME AND INSURED FUNDS. Securities are valued based upon a computerized
matrix system and/or appraisals by a pricing service, both of which
consider market transactions and dealer-supplied valuations. Securities for
which quotations are not readily available are valued at their fair value
as determined in good faith under consistently applied procedures under the
general supervision of the Board of Trustees. Short-term securities with
remaining maturities of sixty days or less for which quotations are not
readily available are valued at amortized cost or original cost plus
accrued interest, both of which approximate current value.
MONEY MARKET FUND. As permitted under Rule 2a-7 of the 1940 Act, and
certain conditions therein, securities are valued initially at cost and
thereafter assume a constant amortization to maturity of any discount or
premium.
INCOME TAXES. As a qualified regulated investment company under Subchapter
M of the Internal Revenue Code, each fund is not subject to income taxes to
the extent that it distributes substantially all of its taxable income for
the fiscal year. The schedules of investments include information regarding
income taxes under the caption "Income Tax Information."
INTEREST INCOME. Interest income, which includes amortization of premium
and accretion of original issue discount, is accrued as earned. For the
money market fund, accretion of discount represents unrealized gain until
realized at the time of a security disposition or maturity.
EXPENSES. Most expenses of each trust can be directly attributed to a fund.
Expenses which cannot be directly attributed are apportioned between the
funds in the trust.
DISTRIBUTIONS TO SHAREHOLDERS. Dividends are declared daily and paid
monthly from net interest income. Distributions to shareholders from
realized capital gains on investments, if any, are recorded on the
ex-dividend date.
1. SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
DISTRIBUTIONS TO SHAREHOLDERS - CONTINUED
Income and capital gain distributions are determined in accordance with
income tax regulations which may differ from generally accepted accounting
principles. These differences, which may result in distribution
reclassifications, are primarily due to differing treatments for futures
and options transactions, market discount, losses deferred due to futures
and options excise tax regulations.
Permanent book and tax basis differences relating to shareholder
distributions will result in reclassifications to paid in capital and may
affect the per-share allocation between net investment income and realized
and unrealized gain (loss). Any taxable income or gain remaining at fiscal
year end is distributed in the following year.
SECURITY TRANSACTIONS. Security transactions are accounted for as of trade
date. Gains and losses on securities sold are determined on the basis of
identified cost.
2. OPERATING POLICIES.
FUTURES CONTRACTS. Certain funds may use futures contracts to manage their
exposure to the bond markets and to fluctuations in interest rates. Buying
futures tends to increase a fund's exposure to the underlying instrument,
while selling futures tends to decrease a fund's exposure to the underlying
instrument or hedge other fund investments. Futures contracts involve, to
varying degrees, risk of loss in excess of the futures variation margin
reflected in each applicable fund's Statement of Assets and Liabilities.
The underlying face amount at value of any open futures contracts at period
end is shown in each applicable fund's schedule of investments under the
caption "Futures Contracts." This amount reflects each contract's exposure
to the underlying instrument at period end. Losses may arise from changes
in the value of the underlying instruments, if there is an illiquid
secondary market for the contracts, or if the counterparties do not perform
under the contracts' terms. Futures contracts are valued at the settlement
price established each day by the board of trade or exchange on which they
are traded.
DELAYED DELIVERY TRANSACTIONS. Each fund may purchase or sell securities on
a delayed delivery basis. Payment and delivery may take place a month or
more after the date of the transaction. The price of the underlying
securities and the date when the securities will be delivered and paid for
are fixed at the time the transaction is negotiated. The market values of
the securities purchased or sold on a delayed delivery basis are identified
as such in each applicable fund's schedule of investments. Each fund may
receive compensation for interest forgone in the purchase of a delayed
delivery security. With respect to purchase commitments, each fund
identifies securities as segregated in its custodial records with a value
at least equal to the amount of the commitment. Losses may arise due to
changes in the market value of the underlying securities or if the
counterparty does not perform under the contract.
2. OPERATING POLICIES - CONTINUED
WHEN-ISSUED SECURITIES. Each fund may purchase or sell securities on a
when-issued basis. Payment and delivery may take place a month or more
after the date of the transaction. The price of the underlying securities
is fixed at the time the transaction is negotiated. The market values of
the securities purchased on a when-issued or forward commitment basis are
identified as such in each applicable fund's schedule of investments. Each
fund may receive compensation for interest forgone in the purchase of a
when-issued security. With respect to purchase commitments, each fund
identifies securities as segregated in its custodial records with a value
at least equal to the amount of the commitment. The payables and
receivables associated with the purchases and sales of when-issued
securities having the same settlement date and broker are offset.
When-issued securities that have been purchased from and sold to different
brokers are reflected as both payables and receivables in the applicable
statements of assets and liabilities under the caption "Delayed delivery."
Losses may arise due to changes in the market value of the underlying
securities, if the counterparty does not perform under the contract, or if
the issuer does not issue the securities due to political, economic, or
other factors.
3. PURCHASES AND SALES OF INVESTMENTS.
INCOME FUND. Purchases and sales of securities, other than short-term
securities, aggregated $80,441,814 and $104,778,910, respectively.
The market value of futures contracts opened and closed during the period
amounted to $58,081,484 and $52,664,064, respectively.
INSURED FUND. Purchases and sales of securities, other than short-term
securities, aggregated $33,102,996 and $53,425,928, respectively.
The market value of futures contracts opened and closed during the period
amounted to $35,083,392 and $32,240,634, respectively.
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES.
MANAGEMENT FEE. As each fund's investment adviser, Fidelity Management &
Research Company (FMR) receives a monthly fee that is calculated on the
basis of a group fee rate plus a fixed individual fund fee rate applied to
the average net assets of each fund. The group fee rate is the weighted
average of a series of rates and is based on the monthly average net assets
of all the mutual funds advised by FMR. The rates ranged from .1100% to
.3700% for the period. In the event that these rates were lower than the
contractual rates in effect during the period, FMR voluntarily implemented
the above rates, as they resulted in the same or a lower management fee.
The annual individual fund fee rate is .25%. For the period, the management
fees were equivalent to an annual rate of .39% for the income, insured and
money market funds, respectively.
SUB-ADVISER FEE. As the money market fund's investment sub-adviser, FMR
Texas Inc., a wholly owned subsidiary of FMR, receives a fee from FMR of
50% of the
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES - CONTINUED
SUB-ADVISER FEE - CONTINUED
management fee payable to FMR. The fee is paid prior to any voluntary
expense reimbursements which may be in effect.
TRANSFER AGENT AND ACCOUNTING FEES. UMB Bank, n.a. (UMB) is the custodian
and transfer and shareholder servicing agent for the funds. UMB has entered
into a sub-contract with Fidelity Service Company, Inc. (FSC), an affiliate
of FMR, under which FSC performs the activities associated with the funds'
transfer and shareholder servicing agent and accounting functions. The
funds pay account fees and asset-based fees that vary according to account
size and type of account. FSC pays for typesetting, printing and mailing of
all shareholder reports, except proxy statements. The accounting fee is
based on the level of average net assets for the month plus out-of-pocket
expenses. For the period, FSC received transfer agent and accounting fees
amounting to $570,741 and $205,336 for the income fund,$265,238 and
$92,472 for the insured fund and $1,462,476 and $127,726 for the money
market fund, respectively.
For the period, the transfer agent fees were equivalent to an annual rate
of .12%, .13% and .20% of average net assets for the income fund, insured
fund and the money market fund, respectively.
Money market shareholders participating in the Fidelity Ultra Service
Account(registered trademark) Program (the Program) pay a $5.00 monthly fee
to Fidelity Brokerage Services, Inc. (FBSI), an affiliate of FMR, for
performing services associated with the Program. For the period, fees paid
to FBSI by shareholders participating in the Program amounted to $118,761.
5. EXPENSE REDUCTIONS.
Each fund has entered into arrangements with its custodian and transfer
agent whereby interest earned on uninvested cash balances was used to
offset a portion of each fund's expenses. During the period, the custodian
and transfer agent fees were reduced by $1,120 and $3,006, $448 and $1,347,
and $0 and $103,299 for the income fund, insured fund and money market
fund, respectively, under these arrangements.
6. PROPOSED REORGANIZATION.
The Board of Trustees has approved Agreements and Plans of Reorganization
("Agreements") between California Municipal Income Fund ("Acquiring
Fund")and California Insured Municipal Income Fund, Spartan California
Municipal Income Fund, and Spartan California Intermediate Municipal Income
Fund ("Target Funds"). The Agreements provide for the transfer of
substantially all of the assets of each of the Target Funds in exchange
solely for the number of shares of the Acquiring Fund having the same
aggregate net asset value as the outstanding shares of each of the Target
Funds at the close of business on the day that the Reorganizations are
effective. The Agreements also provide for the assumption by the Acquiring
Fund of substantially all of the liabilities of each of the Target Funds. A
Reorganization can be consummated only if, among other things,
6. PROPOSED REORGANIZATION - CONTINUED
it is approved by the vote of a majority (as defined by the Investment
Company Act of 1940) of outstanding voting securities of the Target Fund to
which the Reorganization relates. A Special Meeting of Shareholders
(Meeting) of the Target Funds will be held on August 4, 1997 to vote on the
Agreements. A detailed description of the proposed transaction and voting
information will be sent to shareholders of the Target Funds in June 1997.
If the Agreements are approved at the Meeting, the Reorganizations are
expected to become effective in August 1997.
Effective February 28, 1997, shares of California Insured Municipal Income
Fund are no longer available for purchase or exchange to new accounts of
the fund.
REPORT OF INDEPENDENT ACCOUNTANTS
To the Trustees of Fidelity California Municipal Trust and Fidelity
California Municipal Trust II and the Shareholders of Fidelity California
Municipal Income Fund, Fidelity California Insured Municipal Income Fund,
and Fidelity California Municipal Money Market Fund:
In our opinion, the accompanying statements of assets and liabilities,
including the schedules of investments (except for Moody's and Standard &
Poor's ratings), and the related statements of operations and of changes in
net assets and the financial highlights present fairly, in all material
respects, the financial position of Fidelity California Municipal Income
Fund and Fidelity California Insured Municipal Income Fund (funds of
Fidelity California Municipal Trust) and Fidelity California Municipal
Money Market Fund (a fund of Fidelity California Municipal Trust II) at
February 28, 1997, the results of each of their operations for the year
then ended, the changes in each of their net assets and the financial
highlights for the periods indicated, in conformity with generally accepted
accounting principles. These financial statements and financial highlights
(hereafter referred to as "financial statements") are the responsibility of
each fund's management; our responsibility is to express an opinion on
these financial statements based on our audits. We conducted our audits of
these financial statements in accordance with generally accepted auditing
standards which require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant
estimates made by management, and evaluating the overall financial
statement presentation. We believe that our audits, which included
confirmation of securities at February 28, 1997 by correspondence with the
custodian and brokers and the application of alternative auditing
procedures where confirmations from brokers were not received, provide a
reasonable basis for the opinion expressed above.
PRICE WATERHOUSE LLP
Boston, Massachusetts
April 3, 1997
INVESTMENT ADVISER
(registered trademark)
Fidelity Management & Research
Company
Boston, MA
INVESTMENT SUB-ADVISER,
MONEY MARKET FUND
FMR Texas Inc.
Irving, TX
OFFICERS
Edward C. Johnson 3d, President
J. Gary Burkhead, Senior Vice President
Fred L. Henning, Jr., Vice President -
FIXED-INCOME FUNDS
Sarah H. Zenoble, Vice President -
MONEY MARKET FUND
Arthur S. Loring, Secretary
Kenneth A. Rathgeber, Treasurer
Thomas D. Maher, Assistant
Vice President
John H. Costello, Assistant Treasurer
Leonard M. Rush, Assistant Treasurer
Thomas J. Simpson, Assistant Treasurer
BOARD OF TRUSTEES
J. Gary Burkhead
Ralph F. Cox *
Phyllis Burke Davis *
Edward C. Johnson 3d
E. Bradley Jones *
Donald J. Kirk *
Peter S. Lynch
Marvin L. Mann *
William O. McCoy * (dagger)
Gerald C. McDonough *
Thomas R. Williams *
* INDEPENDENT TRUSTEES
(dagger) SERVED AS A MEMBER OF THE ADVISORY BOARD FOR FIDELITY
CALIFORNIA MUNICIPAL MONEY MARKET FUND
GENERAL DISTRIBUTOR
Fidelity Distributors Corporation
Boston, MA
TRANSFER AND SHAREHOLDER
SERVICING AGENTS
UMB Bank, n.a.
Kansas City, MO
and
Fidelity Service Company, Inc.
Boston, MA
CUSTODIAN
UMB Bank, n.a.
Kansas City, MO
THE FIDELITY TELEPHONE CONNECTION
MUTUAL FUND 24-HOUR SERVICE
Exchanges/Redemptions 1-800-544-7777
Account Assistance 1-800-544-6666
Product Information 1-800-544-8888
Retirement Accounts 1-800-544-4774 (8 a.m. - 9 p.m.)
TDD Service 1-800-544-0118
for the deaf and hearing impaired
(9 a.m. - 9 p.m. Eastern time)
TouchTone Xpress 1-800-544-5555
SM
AUTOMATED LINE FOR QUICKEST SERVICE
SPARTAN(registered trademark)
(registered trademark)
CALIFORNIA
MUNICIPAL
FUNDS
ANNUAL REPORT
FEBRUARY 28, 1997
CHECK PAGE NUMBERS !!!
CONTENTS
<TABLE>
<CAPTION>
<S> <C> <C>
PRESIDENT'S MESSAGE 3 NED JOHNSON ON INVESTING
STRATEGIES
SPARTAN CALIFORNIA MUNICIPAL INCOME FUND
4 PERFORMANCE
7 FUND TALK: THE MANAGER'S OVERVI
EW
10 INVESTMENT CHANGES
11 INVESTMENTS
22 FINANCIAL STATEMENTS
SPARTAN CALIFORNIA INTERMEDIATE MUNICIPAL INCOME FUND
26 PERFORMANCE
29 FUND TALK: THE MANAGER'S OVERVI
EW
32 INVESTMENT CHANGES
33 INVESTMENTS
39 FINANCIAL STATEMENTS
SPARTAN CALIFORNIA MUNICIPAL MONEY MARKET FUND
43 PERFORMANCE
45 FUND TALK: THE MANAGER'S OVERVI
EW
47 INVESTMENT CHANGES
48 INVESTMENTS
60 FINANCIAL STATEMENTS
NOTES 64 NOTES TO THE FINANCIAL STATEMENTS
REPORT OF INDEPENDENT 68 THE AUDITOR'S OPINION
ACCOUNTANTS
DISTRIBUTIONS 69
</TABLE>
To reduce expenses and demonstrate respect for our environment, we have
initiated a project through which we will begin eliminating duplicate
copies of most financial reports and prospectuses to most households, even
if they have more than one account in the fund. If additional copies of
financial reports, prospectuses or historical account information are
needed, please call 1-800-544-6666.
THIS REPORT AND THE FINANCIAL STATEMENTS CONTAINED HEREIN ARE SUBMITTED FOR
THE GENERAL
INFORMATION OF THE SHAREHOLDERS OF THE FUNDS. THIS REPORT IS NOT AUTHORIZED
FOR
DISTRIBUTION TO PROSPECTIVE INVESTORS IN THE FUNDS UNLESS PRECEDED OR
ACCOMPANIED BY
AN EFFECTIVE PROSPECTUS.
MUTUAL FUND SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED
BY, ANY DEPOSITORY INSTITUTION. SHARES ARE NOT INSURED BY THE FDIC, THE
FEDERAL RESERVE BOARD, OR ANY OTHER AGENCY, AND ARE SUBJECT TO
INVESTMENT RISKS, INCLUDING POSSIBLE LOSS OF PRINCIPAL AMOUNT INVESTED.
NEITHER THE FUNDS NOR FIDELITY DISTRIBUTORS CORPORATION IS A BANK.
FOR MORE INFORMATION ON ANY FIDELITY FUND, INCLUDING CHARGES AND EXPENSES,
CALL
1-800-544-8888 FOR A FREE PROSPECTUS. READ IT CAREFULLY BEFORE YOU INVEST
OR SEND
MONEY.
PRESIDENT'S MESSAGE
(PHOTO_OF_EDWARD_C_JOHNSON_3D)DEAR SHAREHOLDER:
As 1997 begins, the stock and bond markets generally have continued on the
course they followed during the past year. Through February, stocks
maintained their unprecedented climb, with the large companies still
setting the pace. With low, stable interest rates, the bond market has
tended to mirror its historical returns in the mid-single digits.
While it's impossible to predict the future direction of the markets with
any degree of certainty, there are certain basic principles that can help
investors plan for their future needs.
The longer your investment time frame, the more likely it is that you will
be affected by short-term market volatility. A 10-year investment horizon
appropriate for saving for a college education, for example, enables you to
weather market cycles in a long-term fund, which may have a higher risk
potential, but also has a higher potential rate of return.
An intermediate-length fund could make sense if your investment horizon is
two to four years, while a short-term bond fund could be the right choice
if you need your money in one or two years.
If your time horizon is less than a year, you might want to consider moving
some of your bond investment into a money market fund. These funds seek
income and a stable share price by investing in high-quality, short-term
investments. Of course, it's important to remember that there is no
assurance that a money market fund will achieve its goal of maintaining a
stable net asset value of $1.00 per share, and that these types of funds
are neither insured nor guaranteed by any agency of the U.S. government.
Finally, no matter what your time horizon or portfolio diversity, it makes
good sense to follow a regular investment plan, investing a certain amount
of money in a fund at the same time each month or quarter and periodically
reviewing your overall portfolio. By doing so, you won't get caught up in
the excitement of a rapidly rising market, nor will you buy all your shares
at market highs. While this strategy - known as dollar cost averaging -
won't assure a profit or protect you from a loss in a declining market, it
should help you lower the average cost of your purchases.
If you have questions, please call us at 1-800-544-8888. We are available
24 hours a day, seven days a week to provide you the information you need
to make the investments that are right for you.
Best regards,
Edward C. Johnson 3d
SPARTAN CALIFORNIA MUNICIPAL INCOME FUND
PERFORMANCE: THE BOTTOM LINE
There are several ways to evaluate a fund's historical performance. You can
look at the total percentage change in value, the average annual percentage
change, or the growth of a hypothetical $10,000 investment. Total return
reflects the change in the value of an investment, assuming reinvestment of
the fund's dividend income and capital gains (the profits earned upon the
sale of securities that have grown in value). You can also look at the
fund's income, as reflected in the fund's yield, to measure performance. If
Fidelity had not reimbursed certain fund expenses, the past five years and
life of fund total returns would have been lower.
<TABLE>
<CAPTION>
<S> <C> <C> <C>
CUMULATIVE TOTAL RETURNS
PERIODS ENDED FEBRUARY 28, 1997 PAST 1 PAST 5 LIFE OF
YEAR YEARS FUND
Spartan California Municipal Income 6.23% 41.99% 74.26%
Lehman Brothers California 5.49% n/a n/a
Municipal Bond Index
California Municipal Debt Funds Average 4.81% 39.94% n/a
</TABLE>
CUMULATIVE TOTAL RETURNS show the fund's performance in percentage terms
over a set period - in this case, one year, five years, or since the fund
started on November 27, 1989. For example, if you invested $1,000 in a fund
that had a 5% return over the past year, the value of your investment would
be $1,050. You can compare the fund's returns to the performance of the
Lehman Brothers California Municipal Bond Index - a total return
performance benchmark for California investment-grade municipal bonds with
maturities of at least one year. To measure how the fund's performance
stacked up against its peers, you can compare it to the California
municipal debt funds average, which reflects the performance of 98 mutual
funds with similar objectives tracked by Lipper Analytical Services over
the past one year. Both benchmarks include reinvested dividends and capital
gains, if any, and exclude the effect of sales charges.
AVERAGE ANNUAL TOTAL RETURNS
<TABLE>
<CAPTION>
<S> <C> <C> <C>
PERIODS ENDED FEBRUARY 28, 1997 PAST 1 PAST 5 LIFE OF
YEAR YEARS FUND
Spartan California Municipal Income 6.23% 7.26% 7.95%
Lehman Brothers California 5.49% n/a n/a
Municipal Bond Index
California Municipal Debt Funds Average 4.81% 6.94% n/a
</TABLE>
AVERAGE ANNUAL TOTAL RETURNS take the fund's cumulative return and show you
what would have happened if the fund had performed at a constant rate each
year. (Note: Lipper calculates average annual total returns by annualizing
each fund's total return, then taking an arithmetic average. This may
produce a slightly different figure than that obtained by averaging the
cumulative total returns and annualizing the result.)
$10,000 OVER LIFE OF FUND
IMAHDR PRASUN SHR__CHT 19960930 19961009 151627 S00000000000001
Spartan CA Municipal Inc LB Municipal Bond Index
00456 SB015
1989/11/30 10000.00 10000.00
1989/12/31 10089.59 10081.80
1990/01/31 9987.25 10034.11
1990/02/28 10117.35 10123.42
1990/03/31 10159.32 10126.45
1990/04/30 10004.71 10053.14
1990/05/31 10291.89 10272.60
1990/06/30 10405.52 10362.89
1990/07/31 10581.77 10515.23
1990/08/31 10331.20 10362.55
1990/09/30 10395.14 10368.45
1990/10/31 10553.03 10556.54
1990/11/30 10839.14 10768.83
1990/12/31 10913.37 10815.67
1991/01/31 11018.97 10960.82
1991/02/28 11069.19 11056.18
1991/03/31 11087.33 11060.16
1991/04/30 11257.63 11207.26
1991/05/31 11362.91 11306.89
1991/06/30 11346.29 11295.70
1991/07/31 11518.86 11433.28
1991/08/31 11648.24 11583.86
1991/09/30 11801.25 11734.68
1991/10/31 11931.27 11840.29
1991/11/30 11937.35 11873.33
1991/12/31 12173.82 12128.13
1992/01/31 12203.84 12155.78
1992/02/29 12206.43 12159.67
1992/03/31 12224.31 12164.17
1992/04/30 12344.97 12272.43
1992/05/31 12515.95 12416.88
1992/06/30 12732.29 12625.23
1992/07/31 13141.15 13003.74
1992/08/31 12932.81 12876.95
1992/09/30 13009.44 12961.16
1992/10/31 12727.10 12833.76
1992/11/30 13058.63 13063.61
1992/12/31 13248.16 13196.99
1993/01/31 13414.28 13350.47
1993/02/28 14043.77 13833.36
1993/03/31 13901.29 13687.14
1993/04/30 14029.92 13825.24
1993/05/31 14111.35 13902.94
1993/06/30 14341.36 14134.98
1993/07/31 14346.56 14153.49
1993/08/31 14721.68 14448.17
1993/09/30 14903.97 14612.73
1993/10/31 14947.67 14640.94
1993/11/30 14794.62 14511.95
1993/12/31 15105.43 14818.30
1994/01/31 15269.35 14987.52
1994/02/28 14833.85 14599.35
1994/03/31 14078.16 14004.86
1994/04/30 14135.58 14123.62
1994/05/31 14220.77 14246.07
1994/06/30 14092.86 14159.03
1994/07/31 14375.56 14418.57
1994/08/31 14419.07 14468.45
1994/09/30 14204.30 14256.06
1994/10/31 13876.60 14002.87
1994/11/30 13517.02 13749.70
1994/12/31 13750.68 14052.33
1995/01/31 14245.85 14453.94
1995/02/28 14707.09 14874.26
1995/03/31 14837.90 15045.17
1995/04/30 14833.36 15062.92
1995/05/31 15321.72 15543.58
1995/06/30 15123.46 15408.35
1995/07/31 15240.64 15554.42
1995/08/31 15417.15 15751.65
1995/09/30 15563.13 15851.36
1995/10/31 15833.51 16081.84
1995/11/30 16163.42 16348.64
1995/12/31 16359.60 16505.75
1996/01/31 16479.48 16630.37
1996/02/29 16316.46 16518.11
1996/03/31 16094.63 16307.01
1996/04/30 16028.50 16260.86
1996/05/31 16023.93 16254.36
1996/06/30 16221.27 16431.37
1996/07/31 16390.10 16580.89
1996/08/31 16416.27 16576.91
1996/09/30 16663.22 16808.99
1996/10/31 16881.29 16999.10
1996/11/30 17242.89 17310.18
1996/12/31 17140.30 17237.48
1997/01/31 17166.98 17270.06
1997/02/28 17332.95 17428.49
IMATRL PRASUN SHR__CHT 19960930 19961009 151629 R00000000000123
$10,000 OVER LIFE OF FUND: Let's say hypothetically that $10,000 was
invested in Spartan California Municipal Income Fund on November 30, 1989,
shortly after the fund started. As the chart shows, by February 28, 1997,
the value of the investment would have grown to $17,333 - a 73.33% increase
on the initial investment. For comparison, look at how the Lehman Brothers
Municipal Bond Index, which reflects the performance of the
investment-grade municipal bond market, did over the same period. With
dividends and capital gains, if any, reinvested, the same $10,000 would
have grown to $17,429 - a 74.29% increase.
UNDERSTANDING
PERFORMANCE
How a fund did yesterday is
no guarantee of how it will do
tomorrow. Bond prices, for
example, generally move in
the opposite direction of
interest rates. In turn, the
share price, return, and yield of
a fund that invests in bonds
will vary. That means if you
sell your shares during a
market downturn, you might
lose money. But if you can ride
out the market's ups and
downs, you may have a gain.
(checkmark)
TOTAL RETURN COMPONENTS
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
YEAR ENDED YEAR ENDED YEARS ENDED FEBRUARY 28,
FEBRUARY FEBRUARY
28, 29,
1997 1996 1995 1994 1993
Dividend returns 5.45% 5.95% 5.83% 5.62% 6.72%
Capital appreciation returns 0.78% 4.99% -6.69% 0.00% 8.32%
Total returns 6.23% 10.94% -0.86% 5.62% 15.04%
</TABLE>
TOTAL RETURN COMPONENTS include both dividend returns and capital
appreciation returns. A dividend return reflects the actual dividends paid
by the fund. A capital appreciation return reflects both the amount paid by
the fund to shareholders as capital gain distributions and changes in the
fund's share price. Both returns assume the dividends or capital gains paid
by the fund are reinvested. For the periods through February 29, 1996,
capital appreciation and total returns include the effect of a $5 account
closeout fee on an average size account.
DIVIDENDS AND YIELD
<TABLE>
<CAPTION>
<S> <C> <C> <C>
PERIODS ENDED FEBRUARY 28, 1997 PAST PAST 6 PAST 1
MONTH MONTHS YEAR
Dividends per share 4.19(cents) 27.09(cents) 54.94(cents)
Annualized dividend rate 5.15% 5.20% 5.29%
30-day annualized yield 4.79% - -
30-day annualized tax-equivalent yield 8.25% - -
</TABLE>
DIVIDENDS per share show the income paid by the fund for a set period. If
you annualize this number, based on an average share price of $10.61 over
the past month, $10.51 over the past six months and $10.39 over the past
year, you can compare the fund's income over these three periods. Dividends
per share show the income paid by the fund for a set period and do not
reflect any tax reclassifications. The 30-day annualized YIELD is a
standard formula for all funds based on the yields of the bonds in the
fund, averaged over the past 30 days. This figure shows you the yield
characteristics of the fund's investments at the end of the period. It also
helps you compare funds from different companies on an equal basis. The
tax-equivalent yield shows what you would have to earn on a taxable
investment to equal the fund's tax-free yield, if you're in the 41.95%
combined effective 1997 federal and state income tax bracket, but does not
reflect payment of the federal alternative minimum tax, if applicable.
SPARTAN CALIFORNIA MUNICIPAL INCOME FUND
FUND TALK: THE MANAGER'S OVERVIEW
MARKET RECAP
Stable demand helped municipal
bonds perform better than their
investment-grade taxable
counterparts in the 12 months
ending February 28, 1997.
However, anticipation of
short-term interest rate increases
by the Federal Reserve Board
negatively affected all bonds. For
the period, the Lehman
Brothers Municipal Bond Index
- - a broad measure of the
municipal bond market - had a
total return of 5.51%. In
comparison, the Lehman Brothers
Aggregate Bond Index - a
broad measure of the
performance of the U.S. taxable
bond market - returned 5.35%.
New issue supply in the municipal
market was strong through the
first half of the period, but
insurance companies and
individual investors helped sustain
demand. The diminishing
likelihood of significant tax reform
in the near future also helped
support the muni market. Like
most domestic bonds, munis were
affected by signs of strength in the
economy in the first half of 1996.
Nevertheless, the market
conditions that supported the
muni market helped it enter the fall
trading at expensive levels
relative to its taxable counterparts.
Munis stalled because their rich
valuations inhibited demand and
encouraged selling. From
December on, most bond
markets suffered from fears -
confirmed by Fed Chairman Alan
Greenspan's testimony before
Congress in late February - that
latent inflation pressures might
encourage the Fed to raise
short-term rates. Munis, however,
outperformed over the past few
months, in part because of a thin
supply of new issues.
(Portfolio Manager: Jonathan Short photograph)
An interview with Jonathan Short, Portfolio Manager of Spartan California
Municipal Income Fund
Q. HOW DID THE FUND PERFORM, JON?
A. For the year ending February 28, 1997, the fund had a total return of
6.23%. For comparison purposes, the California municipal debt funds
average, as tracked by Lipper Analytical Services, returned 4.81%, and the
Lehman Brothers California Municipal Bond Index returned 5.49% for the same
one-year period.
Q. WHAT TYPES OF BONDS DID WELL?
A. Baa-rated securities were some of the market's - and the fund's - best
performers and were a key reason why the fund fared better than many of its
competitors. The main driver for their strong returns was tightening credit
spreads - meaning lower-quality bonds' yields fell relative to
higher-quality bonds during the period. As a result, the prices of
lower-quality bonds generally performed better than higher-quality
securities. Toward the end of the period, I sold some of these Baa-rated
securities in order to lock in their gains. Other good performers were
non-callable bonds, which can't be redeemed by their issuer prior to
maturity. When interest rates fall, municipal issuers often call - or
redeem - bonds before their maturity date and issue new bonds as a way to
lower their interest costs. Because the bond market experienced a small
rally over the past six months, non-callable bonds generally performed
better than callable bonds.
Q. WHAT STRATEGIES DID YOU EMPLOY OVER THE PAST SIX MONTHS?
A. I focused on bonds with maturities in the intermediate range - those
with maturities of between five and 20 years - while keeping the fund's
holdings in shorter- and longer-term bonds light. I chose to emphasize
intermediate bonds because I believed that their expected total return was
greater than that of longer-maturity bonds. Additionally, I did not believe
that many longer-term securities offered enough additional yield to
compensate investors for their added interest rate sensitivity. All in all,
I felt that intermediate maturity bonds were attractive on a risk/return
basis.
Q. THERE HAS BEEN A LOT OF CONSOLIDATION IN THE HEALTH CARE SECTOR
RECENTLY. DID IT HAVE ANY EFFECT ON THE FUND?
A. Yes, it did. To the benefit of the fund, bonds issued by Sequoia
Hospital performed well when it was merged with Catholic Health Care West.
Additionally, our holdings in Eisenhower Hospital, issued by Rancho Mirage
Joint Powers Financing Authority, were advance refunded. With an advance
refunding, an issuer with existing bonds in the market will issue a second
set of bonds. Proceeds from the second issue are then invested in
high-quality U.S. Treasury securities, and these Treasuries then secure the
original bonds until the call date.
Q. THE FUND'S STAKE IN GENERAL OBLIGATION BONDS (GOS) ISSUED BY THE STATE
HAS INCREASED OVER THE PAST SIX MONTHS. WHY WERE THESE SECURITIES
ATTRACTIVE?
A. GOs issued by the state are backed by its full faith and credit and are
repaid by general revenue, in contrast to revenue from a specific facility
or project built with borrowed funds. In my opinion, the state's credit
worthiness has improved as its economy has rebounded. In fact, revenue
collections have improved to the point where estimates call for the state's
budget to post $1 billion more in revenues than originally projected.
Q. WHAT'S YOUR OUTLOOK?
A. From a supply and demand standpoint, I'm optimistic about municipals. I
don't expect to see a tremendous amount of new bonds issued, and the
increase in supply we're likely to see should be easily digested if demand
remains firm. How municipals fare over the next six months or so will
depend heavily on the direction of interest rates, but I don't think anyone
can accurately pinpoint where interest rates will be a year from now. That
said, we may continue to see some volatility in the bond market as long as
there are conflicting signs about the economy and inflation trends.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO MANAGER
ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON THE COVER.
THE MANAGER'S VIEWS ARE SUBJECT TO CHANGE AT ANY TIME BASED ON MARKET AND
OTHER CONDITIONS.
FUND FACTS
GOAL: high current income
for California residents by
normally investing in
investment-grade municipal
securities whose interest is
free from federal income tax
and California personal
income tax
FUND NUMBER: 456
TRADING SYMBOL: FSCAX
START DATE: November
27,1989
SIZE: as of February 28, 1997,
more than $401 million
MANAGER: Jonathan Short,
since 1995; manager, various
Fidelity and Spartan state
municipal bond funds, since
1995; joined Fidelity in 1990
(checkmark)
JONATHAN SHORT ON
CALIFORNIA'S ECONOMY:
"The strength of California's
economic rebound is an
important component in the
overall performance of
California municipal bonds.
For a number of reasons, I am
optimistic about California's
economy. The first is
employment growth, which
continues to outpace the
nation as a whole. Second,
the state budget is posting
revenues well ahead of
projections, thanks mostly to
rising tax collections. Third,
the rebound has grown to be
more broad-based, with
southern California finally
showing improvements after
lagging behind the northern
part of the state. Finally,
permits to build new houses
are up about 15% this year
and sales of existing homes
seem to have stabilized."
SPARTAN CALIFORNIA MUNICIPAL INCOME FUND
INVESTMENT CHANGES
TOP FIVE SECTORS AS OF FEBRUARY 28, 1997
% OF FUND'S % OF FUND'S INVESTMENT
INVESTMENTS S
IN THESE SECTORS
6 MONTHS AGO
General Obligation 26.1 23.4
Water & Sewer 12.2 11.6
Electric Revenue 11.3 10.1
Special Tax 10.9 11.6
Lease Revenue 10.4 13.1
AVERAGE YEARS TO MATURITY AS OF FEBRUARY 28, 1997
6 MONTHS AGO
Years 15.7 16.4
AVERAGE YEARS TO MATURITY IS BASED ON THE AVERAGE TIME UNTIL PRINCIPAL
PAYMENTS ARE EXPECTED FROM EACH OF THE FUND'S BONDS, WEIGHTED BY DOLLAR
AMOUNT.
DURATION AS OF FEBRUARY 28, 1997
6 MONTHS AGO
Years 7.7 7.8
DURATION SHOWS HOW MUCH A BOND FUND'S PRICE FLUCTUATES WITH CHANGES IN
COMPARABLE INTEREST RATES. IF RATES RISE 1%, FOR EXAMPLE, A FUND WITH A
FIVE-YEAR DURATION IS LIKELY TO LOSE ABOUT 5% OF ITS VALUE. OTHER FACTORS
ALSO CAN INFLUENCE A BOND FUND'S PERFORMANCE AND SHARE PRICE. ACCORDINGLY,
A BOND FUND'S ACTUAL PERFORMANCE MAY DIFFER FROM THIS EXAMPLE.
QUALITY DIVERSIFICATION (MOODY'S RATINGS)
AS OF FEBRUARY 28, 1997 AS OF AUGUST 31, 1996
Aaa 40.7%
Aa, A 39.8%
Baa 14.7%
Non-rated 2.3%
Short-term and other
investments 2.5%
Aaa 41.7%
Aa, A 37.4%
Baa 16.0%
Non-rated 2.3%
Short-term and other
investments 2.6%
Row: 1, Col: 1, Value: 40.2
Row: 1, Col: 2, Value: 39.3
Row: 1, Col: 3, Value: 13.7
Row: 1, Col: 4, Value: 3.3
Row: 1, Col: 5, Value: 3.5
Row: 1, Col: 1, Value: 41.7
Row: 1, Col: 2, Value: 36.4
Row: 1, Col: 3, Value: 15.0
Row: 1, Col: 4, Value: 3.3
Row: 1, Col: 5, Value: 3.6
SHOWN AS A PERCENTAGE OF THE FUND'S INVESTMENTS. WHERE MOODY'S RATINGS ARE
NOT AVAILABLE, WE HAVE USED S&P RATINGS.
SPARTAN CALIFORNIA MUNICIPAL INCOME FUND
INVESTMENTS FEBRUARY 28, 1997
Showing Percentage of Total Value of Investments in Securities
MUNICIPAL BONDS - 97.5%
<TABLE>
<CAPTION>
<S> <C> <C> <C>
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (B) AMOUNT (NOTE 1)
CALIFORNIA - 97.5%
Alameda Hsg. Auth. Multi-Family Hsg. Rev.
(Independence Apts.) Series A,
7.50% 2/20/31 (GNMA Coll.) AAA $ 1,765,000 $ 1,811,331
Anaheim Pub. Fing. Auth. Tax Allocation Rev.
(Cap. Appreciation Redev. Proj.)
0% 12/1/06 (MBIA Insured) Aaa 5,000,000 3,068,750
Buena Park Commty. Redev. Agcy. Tax
Allocation Rfdg. (Central Bus. Dist. Proj.)
7.10% 9/1/14 BBB+ 1,500,000 1,588,125
Burbank Redev. Agcy. Tax Allocation Series
A, 5.75% 12/1/08 Baa1 2,355,000 2,393,269
Cabrillo Unified School Dist. (Cap.
Appreciation) Series A, 0% 8/1/10 (AMBAC
Insured) Aaa 2,150,000 1,029,312
California Dept. Wtr. Resources Rev.
(Central Valley Proj.):
(Wtr. Sys. Proj.) Series J-1, 7%
12/1/12 (e) Aa 1,000,000 1,170,000
Series O:
4.75% 12/1/17 Aa 2,000,000 1,775,000
4.75% 12/1/25 Aa 6,555,000 5,678,269
5% 12/1/22 Aa 1,900,000 1,726,625
California Edl. Facs. Auth. Rev.:
Rfdg. (Chapman Univ.) 5.375% 10/1/16 (h) AAA 1,000,000 962,500
Rfdg. (Univ. of Southern California)
Series A, 5.65% 10/1/10 Aa3 1,000,000 1,011,250
(Stanford Univ.) Series J, 6% 11/1/16 Aaa 1,955,000 2,011,206
California Gen. Oblig.:
Rfdg. 5.50% 6/1/03 A1 4,000,000 4,200,000
Rfdg. 5.60% 9/1/21 A1 1,900,000 1,866,750
Unltd. Tax 6% 9/1/03 A1 5,000,000 5,400,000
Unltd. Tax 6.40% 2/1/05 A1 1,690,000 1,871,675
6.10% 2/1/02 A1 1,000,000 1,071,250
6.40% 9/1/07 A1 2,000,000 2,245,000
4.75% 9/1/10 A1 1,400,000 1,330,000
6.50% 9/1/10 A1 1,950,000 2,198,625
7% 10/1/10 A1 1,000,000 1,176,250
5.25% 10/1/14 A1 1,000,000 971,250
5.25% 10/1/17 A1 1,500,000 1,430,625
6.25% 10/1/19
(Pre-Refunded to 10/1/02 @102) (d) A1 4,200,000 4,593,750
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (B) AMOUNT (NOTE 1)
CALIFORNIA - CONTINUED
California Health Facs. Fin. Auth. Rev.:
Rfdg. (Children's Hosp.)
6% 7/1/06 (MBIA Insured) Aaa $ 1,000,000 $ 1,083,750
(Gould Med. Foundation) Series A,
7.30% 4/1/20 (Escrowed to Maturity) (d) A 1,500,000 1,650,000
(Los Medanos Health Care Corp.) Series A,
7.25% 3/1/20 A 1,500,000 1,548,750
(Summit Med. Ctr.) Series A,
5.50% 5/1/05 (FSA Insured) Aaa 1,200,000 1,251,000
California Hsg. Fin. Agcy. Rev. (Home Mtg.)
(c):
Series A, 0% 8/1/23 Aa 3,650,000 483,625
Series C:
8.30% 8/1/19 Aa 945,000 978,075
0% 8/1/21 Aa 5,870,000 909,850
7.60% 8/1/30 Aa 5,815,000 6,156,631
Series F-2, 7.25% 8/1/16 Aa 3,825,000 4,035,375
Series L, 5.70% 8/1/25 (MBIA Insured) Aaa 1,150,000 1,152,875
California Poll. Cont. Fing. Auth. Poll. Cont.
Rev. Rfdg. (San Diego Gas & Elec.)
Series A, 5.90% 6/1/14 A2 1,900,000 1,992,625
California Pub. Cap. Impt. Fing. Auth. Rev.
(Pooled Proj.) Series B,
8.10% 3/1/18 (MBIA Insured) Aaa 1,825,000 1,911,359
California Pub. Wrks. Board Lease Rev.:
Rfdg. (Dept. of Corrections State Prisons,
Monterey) Series D:
5.375% 11/1/11 A 1,000,000 988,750
5.375% 11/1/14 A 1,000,000 976,250
Rfdg. (Univ. of California Projs.) Series A,
5.40% 12/1/16 (AMBAC Insured) Aaa 1,340,000 1,304,825
(Dept. of Corrections Corcoran II) Series A,
6% 1/1/05 (AMBAC Insured) Aaa 2,000,000 2,152,500
(Dept of Corrections Madera State Prison)
Series E:
5.50% 6/1/15 A 3,000,000 2,996,250
5.50% 6/1/19 A 1,000,000 963,750
(Dept. Correction State Prisons, Susanville)
Series D, 5.25% 6/1/15 (FSA Insured) Aaa 2,000,000 1,950,000
(Franchise Tax Board-PH II) Series A,
6.25% 9/1/11 A 1,150,000 1,191,687
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (B) AMOUNT (NOTE 1)
CALIFORNIA - CONTINUED
California Pub. Wrks. Board Lease Rev.: - continued
(Various California State Univ. Projs.):
Series A:
6.50% 9/1/04 A $ 1,090,000 $ 1,196,275
5.50% 6/1/14 A1 6,475,000 6,434,531
6.40% 12/1/16 Aaa 1,500,000 1,678,125
6.375% 10/1/19 A 1,250,000 1,334,375
Series B:
5% 6/1/06 A1 3,000,000 3,026,250
6.40% 12/1/09 A1 1,000,000 1,113,750
California Rural Home Mtg. Fin. 4.45%
8/1/01 (MBIA Insured) Aaa 3,000,000 2,977,500
California Statewide Commty. Dev. Corp.
Ctfs. of Prtn.:
Rfdg. (Insured Hosp.) (Triad Healthcare)
6.25% 8/1/06 A+ 2,000,000 2,097,500
(Children's Hosp.) 6% 6/1/13 (MBIA Insured) Aaa 1,570,000 1,666,162
(Odd Fellows) 5.375% 10/1/13 A+ 2,500,000 2,390,625
(St. Joseph Health Sys.) 5.50% 7/1/23 Aa3 1,500,000 1,456,875
(Sister of Charity Leavenworth Sys.):
5% 12/1/14 Aa3 1,315,000 1,218,019
5% 12/1/23 Aa3 5,000,000 4,518,750
(Villaview Commty. Hosp., Inc.) Series A,
7% 9/1/09 A 1,145,000 1,240,894
5.616% 7/1/13 (MBIA Insured) Aaa 4,000,000 3,965,000
Campbell Ctfs. of Prtn. Rfdg. (Civic Center
Proj.) 6% 10/1/18 A 2,565,000 2,565,000
Carson Redev. Agcy. Rfdg.:
(Redev. Proj. Area #1) (Tax Allocation):
6.375% 10/1/12 Baa1 1,465,000 1,496,131
6.375% 10/1/16 Baa1 1,000,000 1,017,500
(Redev. Proj. Area #2) (Tax Allocation)
5.875% 10/1/09 Baa 2,000,000 1,977,500
Castaic Lake Wtr. Agcy. Ctfs. of Prtn. Rfdg.
(Wtr. Sys. Impt. Proj.) Series A:
7% 8/1/11 (MBIA Insured) Aaa 1,500,000 1,770,000
7% 8/1/13 (MBIA Insured) Aaa 1,580,000 1,868,350
Central California Joint Pwrs. Health Fing.
Auth. Rfdg. (Commty. Hosp. of Central
California) 5.25% 2/1/04 Baa1 2,000,000 1,960,000
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (B) AMOUNT (NOTE 1)
CALIFORNIA - CONTINUED
Central Valley Fin. Auth. Rev. (Cogeneration
Proj.) (Carson Ice Gen. Proj.):
6% 7/1/09 BBB- $ 3,050,000 $ 3,111,000
6.10% 7/1/13 BBB- 1,000,000 1,015,000
6.20% 7/1/20 BBB- 3,900,000 3,953,625
Clovis Unified School Dist. Series B, 0%
8/1/03 (MBIA Insured) Aaa 3,485,000 2,574,544
Coalinga Ctfs. of Prtn. 7% 4/1/10 BBB+ 1,655,000 1,712,925
Contra Costa County Ctfs. of Prtn.(Merrithew
Mem. Hosp.) (Cap. Appreciation)
0% 11/1/14 A1 3,000,000 1,083,750
Contra Costa Schools Fin. Auth. Rev. Vista
Unified School Dist. School Sites Series A,
0% 9/1/17 (AMBAC Insured)
(Pre-Refunded to 9/1/02 @ 36.34) (d) Aaa 3,420,000 970,425
Contra Costa Trans. Auth. Sales Tax Rev.
Series A:
6% 3/1/03 (FGIC Insured) Aaa 1,000,000 1,080,000
6% 3/1/04 (FGIC Insured) Aaa 1,000,000 1,085,000
Culver City Redev. Fin. Auth. Rev. Rfdg.
Tax Allocation 4.60% 11/1/20
(AMBAC Insured) Aaa 1,500,000 1,265,625
Desert Hosp. Dist. Rev. Ctfs. of Prtn. 6.392%
7/28/20 (FSA Insured) Aaa 5,200,000 5,382,000
Duarte Ctfs. of Prtn. (City of Hope Nat'l.
Med. Ctr.):
6% 4/1/08 Baa1 1,730,000 1,749,462
6.25% 4/1/23 Baa1 2,000,000 2,017,500
East Bay Muni. Util. Dist. Wtr. Sys. Rev.
Rfdg.:
6% 6/1/02 (FGIC Insured) Aaa 1,000,000 1,075,000
6% 6/1/03 (FGIC Insured) Aaa 1,500,000 1,623,750
6% 6/1/04 (FGIC Insured) Aaa 1,460,000 1,587,750
Eastern Muni. Wtr. Dist. Wtr. & Swr. Rev.
Ctfs. of Prtn. 6.75% 7/1/12 (FGIC Insured) Aaa 2,000,000 2,307,500
East Bay Muni. Util. Dist. Wastewater
Treatment Sys.
Rev. Rfdg. 5.75% 6/1/04 (MBIA Insured) Aaa 1,000,000 1,068,750
Elk Grove Unified School Dist. Spl. Tax Rfdg.
(Commty. Facs. Dist. #1) 6.50%
12/1/24 (AMBAC Insured) Aaa 2,000,000 2,277,500
Encintas Unified School Dist. (Cap.
Appreciation) 0% 8/1/10 (MBIA Insured) Aaa 1,000,000 476,250
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (B) AMOUNT (NOTE 1)
CALIFORNIA - CONTINUED
Fairfield-Suison Swr. Dist. Swr. Rev. Rfdg.
Series A:
0% 5/1/07 (MBIA Insured) Aaa $ 1,635,000 $ 972,825
0% 5/1/08 (MBIA Insured) Aaa 2,085,000 1,167,600
0% 5/1/09 (MBIA Insured) Aaa 2,080,000 1,092,000
Folsom Pub. Fing. Auth. Local Agcy. Rev.
Series A, 7.25% 10/1/10 BBB+ 1,285,000 1,346,037
Fontana Redev. Agcy. Tax Allocation Rfdg.
(Jurupa Hills):
Series 1992 A, 7.10% 10/1/23 BBB 2,000,000 2,092,500
Series A, 7% 10/1/14 BBB+ 1,900,000 1,999,750
Foster City Pub. Fin. Auth. 5.80% 9/1/16 A- 1,000,000 987,500
Fremont Unified School Dist. Alameda County
(Cap. Appreciation) Series F,
0% 8/1/04 (MBIA Insured) Aaa 1,270,000 879,475
Irvine Ranch Wtr. Dist. Joint Pwr. Agcy.
Local Pool Rev.:
7.80% 2/15/08 A+ 1,560,000 1,609,202
7.875% 2/15/23 A+ 5,500,000 5,674,680
8.25% 8/15/23 A+ 14,365,000 15,137,119
King County Ctfs. of Prtn. 7.50% 7/1/04 - 2,800,000 2,978,500
Kings River Conservation Dist. Pine Flat Pwr.
Rev. Rfdg. 6.375% 1/1/12 Aa 2,000,000 2,107,500
Long Beach Harbor (c):
6% 5/15/06 (MBIA Insured) Aaa 3,000,000 3,225,000
5.75% 5/15/07 (MBIA Insured) Aaa 4,845,000 5,087,250
5.50% 5/15/15 (MBIA Insured) Aaa 3,710,000 3,617,250
Los Angeles County Ctfs. of Prtn.:
(Correctional Facs.) 0% 9/1/11 (MBIA Insured)
(Escrowed to Maturity) (d) Aaa 6,400,000 2,904,000
(Disney Parking Proj.):
0% 3/1/12 Baa1 2,180,000 833,850
0% 3/1/13 Baa1 2,750,000 979,688
0% 3/1/19 Baa1 3,175,000 746,125
(Health Facs. Construction Loan)
(Bay Harbor Hosp.) 7.30% 4/1/20 A 1,000,000 1,063,750
Los Angeles Dept. Wtr. & Pwr. Elec. Plant Rev.
Rfdg. 6.375% 2/1/20 Aa 1,000,000 1,050,000
Los Angeles Harbor Dept. Rev. 7.60% 10/1/18
(Escrowed to Maturity) (d) Aa 2,270,000 2,811,963
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (B) AMOUNT (NOTE 1)
CALIFORNIA - CONTINUED
Los Angeles County Metropolitan Trans. Auth.
(Sales Tax Rev.):
Second Series A, 5.90% 7/1/04
(AMBAC Insured) Aaa $ 2,135,000 $ 2,311,138
Series A, 5.90% 7/1/14 (MBIA Insured) Aaa 1,585,000 1,640,475
Los Angeles Wastewater Sys. Rev. Rfdg.:
Series A, 5% 2/1/11 (FGIC Insured) Aaa 1,345,000 1,297,925
Series D, 4.70% 11/1/17 (FGIC Insured) Aaa 2,000,000 1,742,500
Madera County Ctfs. of Partn. (Valley
Children's Hospital) 6.25% 3/15/05 (MBIA
Insured) Aaa 500,000 547,500
Metropolitan Wtr. Dist. Southern Waterworks
Rev. Rfdg.:
6% 7/1/05 (MBIA Insured) Aaa 3,000,000 3,273,750
5.75% 8/12/18 Aa 5,000,000 5,018,750
Modesto Ctfs. of Prtn.:
(Commty. Ctr. Refining Proj.) Series A,
5.60% 11/1/14 (AMBAC Insured) Aaa 1,370,000 1,397,400
(Golf Course Refining Proj.) Series B, 5%
11/1/23 (AMBAC Insured) Aaa 1,585,000 1,460,181
Modesto Irrigation Dist. Ctfs. of Prtn. Rfdg.
& Cap. Impts. Series A, 0% 10/1/10 (MBIA
Insured) Aaa 2,270,000 1,092,438
Northern California Pwr. Agcy. Pub. Pwr. Rev.:
Rfdg. (Geothermal Proj. #3) Series A:
5.50% 7/1/05 (AMBAC Insured) Aaa 2,250,000 2,370,938
5.80% 7/1/09 (AMBAC Insured) Aaa 5,675,000 6,029,688
Rfdg.( Hydro Elec. Proj. #1) 7.50% 7/1/23
(AMBAC Insured)
(Pre-Refunded to 7/1/21 @ 100) (d) Aaa 1,170,000 1,452,263
Oakland Redev. Agcy. Central Dist. Redev.
(Sub. Tax Allocation) 5% 9/1/21
(MBIA Insured) Aaa 1,000,000 923,750
Ontario Redev. Fing. Auth. Rev.:
(Ctr. City Cimarron Proj. #1):
0% 8/1/08 (MBIA Insured) Aaa 3,255,000 1,798,388
0% 8/1/09 (MBIA Insured) Aaa 3,260,000 1,691,125
(Ontario Redev. Proj. 1) 6.95% 8/1/11
(MBIA Insured) Aaa 1,000,000 1,175,000
Orange County Local Trans. Auth. Sales Tax
Rev. First Series-Measure M, 6%
2/15/08 (AMBAC Insured) Aaa 1,250,000 1,346,875
Palomar Pomerado Health Sys. Rev.
0% 11/1/05 (MBIA Insured) Aaa 3,075,000 2,010,281
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (B) AMOUNT (NOTE 1)
CALIFORNIA - CONTINUED
Pleasanton Joint Pwrs. Fin. Auth. Reassessment
Series A:
5.80% 9/2/02 Baa $ 2,445,000 $ 2,515,294
6% 9/2/05 Baa 1,390,000 1,445,600
6.15% 9/2/12 Baa 5,095,000 5,171,425
Port Oakland Port Rev.:
Rfdg. Series F:
0% 11/1/06 (MBIA Insured) Aaa 1,250,000 770,313
0% 11/1/08 (MBIA Insured) Aaa 3,500,000 1,907,500
Series G, 6% 11/1/07 (MBIA Insured) (c) Aaa 900,000 960,750
Rancho Mirage Joint Pwrs. Fing. Auth. Ctfs.
of Prtn. (Eisenhower Mem. Hosp.) 7% 3/1/22
(Pre-Refunded to 3/1/02 @ 102) (d) A2 1,000,000 1,131,250
Rancho Wtr. Dist. Fin. Auth. Rev. Rfdg.:
5.875% 11/1/10 (FGIC Insured) Aaa 2,500,000 2,621,875
4.875% 8/1/15 (AMBAC Insured) Aaa 2,005,000 1,807,006
Riverside County Asset Leasing Corp.
Leasehold Rev. (Riverside County Hosp. Proj.)
Series A:
5.75% 6/1/01 A3 1,250,000 1,285,937
6% 6/1/03 A3 1,500,000 1,567,500
6.375% 6/1/09 A3 3,000,000 3,157,500
6.50% 6/1/12 A 5,500,000 5,926,250
Riverside County Redev. Agcy. Tax Allocation
(Redev. Proj. #4) Series A:
7.50% 10/1/10 BBB 1,000,000 1,065,000
7.50% 10/1/26 BBB 2,500,000 2,687,500
Riverside Unified School Dist. Ctfs. of Prtn.
(Cap. Appreciation Land Acquisition Proj.)
Series B, 0% 9/1/26 (FSA Insured) (f) Aaa 1,835,000 1,752,425
Sacramento Cogeneration Auth. Cogeneration
Proj. Rev.:
(Proctor & Gamble Proj.):
5.40% 7/1/98 BBB- 1,000,000 1,011,250
5.70% 7/1/00 BBB- 1,200,000 1,228,500
6.375% 7/1/10 BBB- 800,000 834,000
Sacramento Fing. Auth. Lease Rev. Rfdg.
Series A, 5.40% 11/1/20 (AMBAC Insured) Aaa 1,925,000 1,886,500
Sacramento Muni. Util. Dist. Elec. Rev.:
1.76% 11/15/08 (FGIC Insured) (g) Aaa 7,000,000 6,763,750
6.30% 8/15/18 (FGIC Insured) Aaa 3,500,000 3,648,750
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (B) AMOUNT (NOTE 1)
CALIFORNIA - CONTINUED
Sacramento Pwr. Auth. Rev. (Cogeneration
Proj.) 6.50% 7/1/06 BBB- $ 1,500,000 $ 1,610,625
San Bernardino County Ctfs. of Prtn.:
(Cap. Facs. Proj.) Series B, 6.875% 8/1/24
(Escrowed to Maturity) (d) Baa1 2,500,000 2,959,375
(Med. Ctr. Fin.) 5.50% 8/1/22 Baa1 4,500,000 4,258,125
San Diego County Regional Trans. 6% 4/1/05
(AMBAC Insured) Aaa 1,500,000 1,627,500
San Diego County Regional Trans. Commission
Sales Tax Rev. Second Series A, 6%
4/1/04 (FGIC Insured) Aaa 1,875,000 2,029,687
San Diego County Wtr. Auth. 5.632%
4/25/07 (FGIC Insured) Aaa 2,500,000 2,606,250
San Francisco Bldg. Auth. Lease Rev.
(Dept. Gen. Svcs. Lease) Series A,
5% 10/1/08 A 1,320,000 1,295,250
San Francisco City & County Intl. Arpt. Rev.:
Second Series 2, 6.20%
5/1/05 (AMBAC Insured) Aaa 1,300,000 1,407,250
Second Series 9A, 5.125%
5/1/07 (FGIC Insured) (c) Aaa 2,000,000 1,992,500
San Francisco City & County Pub. School Facs.
Impt. Series A, 7.20% 9/1/01 A1 625,000 647,369
San Francisco City & County Redev. Agcy.
7.75% 9/1/06 - 6,000,000 6,210,540
San Francisco City & County Redev. Fing. Auth.
Tax Allocation Rfdg. (Cap. Appreciation)
(Redev. Proj.) Series B,
0% 8/1/10 (MBIA Insured) Aaa 1,475,000 715,375
San Francisco City & County Swr. Rev.:
Rfdg. 5.90% 10/1/08 (AMBAC Insured) Aaa 2,000,000 2,112,500
Series B:
0% 10/1/06 (FGIC Insured) Aaa 3,690,000 2,297,025
0% 10/1/08 (FGIC Insured) Aaa 1,600,000 882,000
San Joaquin County Ctfs. of Prtn.
(Gen. Hosp. Proj.):
5.70% 9/1/01 A 1,000,000 1,023,750
6.25% 9/1/13 A 2,500,000 2,559,375
Santa Ana Commty. Redev. Agcy. Tax Allocation
(Santa Ana Redev. Proj. Area) Series B,
6.50% 12/15/14 AAA 860,000 915,900
Santa Barbara Ctfs. of Prtn.
(American Baptist Hosp.) 7.40% 5/15/15 A 2,000,000 2,142,500
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (B) AMOUNT (NOTE 1)
CALIFORNIA - CONTINUED
Santa Clara County Fin. Auth. Lease Rev.
(VMC Replacement Proj.) Series A,
7.75% 11/15/08 (AMBAC Insured) Aaa $ 1,175,000 $ 1,462,875
Santa Margarita/Dana Point Auth. Rev.
(Impt. Dists. 1-2-2A & 8) 7.25%
8/1/08 (MBIA Insured) Aaa 1,780,000 2,131,550
Sequoia Hosp. Dist. Rev. Rfdg. 5.375%
8/15/13 (Escrowed to Maturity) (d) Baa 2,225,000 2,216,656
South Orange County Pub. Fin. Auth. Spl.
Tax Rev.:
Rfdg. (Sr. Lien) Series A,
7% 9/1/10 (MBIA Insured) Aaa 3,300,000 3,885,750
(Foothill Area) Series C,
8% 8/15/09 (FGIC Insured) Aaa 3,650,000 4,630,937
Southern California Pub. Pwr. Auth. Pwr.
Proj. Rev. (Multiple Proj.) 6.75% 7/1/11 A 2,500,000 2,809,375
Sulphur Springs Unified School Dist.:
Series A, 0% 9/1/08 (MBIA Insured) Aaa 2,745,000 1,492,594
Unltd. Tax Series A, 0% 9/1/12 (MBIA
Insured) Aaa 2,750,000 1,165,312
Upland Ctfs. of Prtn. (San Antonio Commty.
Hosp.):
5.25% 1/1/08 A 1,850,000 1,801,437
5.25% 1/1/13 A 3,000,000 2,767,500
West Covina Ctfs. of Prtn. (Queen of the Valley
Hosp.) 6.50% 8/15/24 A2 1,100,000 1,142,626
TOTAL MUNICIPAL BONDS
(Cost $373,932,217) 389,534,519
MUNICIPAL NOTES (A) - 2.5%
CALIFORNIA - 2.5%
California Gen. Oblig. RAN 4.50% 6/30/97 MIG 1 1,500,000 1,504,410
California Poll. Cont. Fin. Auth. Poll.
Rev., VRDN:
Rfdg. (Pacific Gas & Elec.) Series C, 3.40%,
LOC Bank of America NT & SA A-1+ 3,400,000 3,400,000
(Southern California Edison Proj.)
Series 1986 C, 3.45% VMIG 1 1,200,000 1,200,000
California Poll. Cont. Fing. Auth.
Resource Recovery Rev., VRDN (c):
(Burney Forest Prod. Proj.) 3.35%,
LOC Fleet Bank Nat'l. Bank P-1 1,500,000 1,500,000
MUNICIPAL NOTES (A) - CONTINUED
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (B) AMOUNT (NOTE 1)
CALIFORNIA - CONTINUED
California Poll. Cont. Fing. Auth. Resource
Recovery Rev., VRDN (c): - continued
(Ultra Pwr. Rocklin Proj.) Series 1988 A,
3.45%, LOC Bank of America NT & SA P-1 $ 300,000 $ 300,000
Fresno County Unltd. Tax TRAN
4.75% 9/29/97 SP-1+ 2,000,000 2,012,520
TOTAL MUNICIPAL NOTES
(Cost $9,916,930) 9,916,930
TOTAL INVESTMENTS - 100%
(Cost $383,849,147) $399,451,449
</TABLE>
FUTURES CONTRACTS
EXPIRATION UNDERLYING FACE UNREALIZED
DATE AMOUNT AT VALUE GAIN/(LOSS)
PURCHASED
68 Municipal Bond Contracts Jun. 1997 $ 7,766,875 $ (19,742)
50 30-Year Treasury Bond
Contracts Jun. 1997 5,521,875 (5,141)
$ 13,288,750 $ (24,883)
THE FACE VALUE OF FUTURES PURCHASED AS A PERCENTAGE OF TOTAL INVESTMENT IN
SECURITIES - 3.3%
SECURITY TYPE ABBREVIATIONS
RAN - Revenue Anticipation Notes
TRAN - Tax and Revenue Anticipation Notes
VRDN - Variable Rate Demand Notes
LEGEND
(d) The coupon rate shown on floating or adjustable rate securities
represents the rate at period end.
(e) Standard & Poor's credit ratings are used in the absence of a rating by
Moody's Investors Service, Inc.
(f) Private activity obligations whose interest is subject to the federal
alternative minimum tax for individuals.
(g) Security collateralized by an amount sufficient to pay interest and
principal.
(h) A portion of the Security was pledged to cover margin requirements for
futures contracts. At the period end, the value of securities pledged
amounted to $409,500.
(i) Debt obligation initially issued in zero coupon form which converts to
coupon form at a specified rate and date.
(j) Debt obligation initially issued at one coupon which converts to a
higher coupon at a specified date.
(k) Security purchased on a delayed delivery basis (see Note 2 of Notes to
Financial Statements).
OTHER INFORMATION
The composition of long-term debt holdings as a percentage of total value
of investment in securities, is as follows (ratings are unaudited):
MOODY'S RATINGS S&P RATINGS
Aaa, Aa, A 69.5% AAA, AA, A 82.1%
Baa 8.5% BBB 8.6%
Ba 0.0% BB 0.0%
B 0.0% B 0.0%
Caa 0.0% CCC 0.0%
Ca, C 0.0% CC, C 0.0%
D 0.0%
The percentage not rated by both S&P and Moody's amounted to 2.3%. FMR has
determined that unrated debt securities that are lower quality account for
0.0% of the total value of investment in securities.
The distribution of municipal securities by revenue source, as a percentage
of total value of investment in securities, is as follows:
General Obligation 26.1%
Water and Sewer 12.2
Electric Revenue 11.3
Special Tax 10.9
Lease Revenue 10.4
Health Care 7.9
Pooled Loan 5.6
Escrowed/Pre-Refunded 5.5
Others (individually less than 5%) 10.1
TOTAL 100.0%
INCOME TAX INFORMATION
At February 28, 1997, the aggregate cost of investment securities for
income tax purposes was $384,029,498. Net unrealized appreciation
aggregated $15,421,951, of which $16,499,483 related to appreciated
investment securities and $1,077,532 related to depreciated investment
securities.
At February 28,1997, the fund had a capital loss carryforward of
approximately $8,463,000 of which $1,148,000 and $7,315,000 will expire on
February 28, 2003 and 2004, respectively.
SPARTAN CALIFORNIA MUNICIPAL INCOME FUND
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
<S> <C> <C>
FEBRUARY 28, 1997
ASSETS
Investment in securities, at value (cost $383,849,147) - $ 399,451,449
See accompanying schedule
Cash 38,298
Interest receivable 5,194,243
Receivable for daily variation on futures contracts 11,500
TOTAL ASSETS 404,695,490
LIABILITIES
Payable for investments purchased
Regular delivery $ 1,333,327
Delayed delivery 999,148
Payable for fund shares redeemed 331,875
Distributions payable 352,943
Accrued management fee 169,460
Other payables and accrued expenses 5,525
TOTAL LIABILITIES 3,192,278
NET ASSETS $ 401,503,212
Net Assets consist of:
Paid in capital $ 395,666,869
Accumulated undistributed net realized gain (loss) (9,741,076)
on investments
Net unrealized appreciation (depreciation) on 15,577,419
investments
NET ASSETS, for 37,882,646 shares outstanding $ 401,503,212
NET ASSET VALUE, offering price and redemption price per $10.60
share ($401,503,212 (divided by) 37,882,646 shares)
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
<S> <C> <C>
YEAR ENDED FEBRUARY 28, 1997
INTEREST INCOME $ 23,067,140
EXPENSES
Management fee $ 2,182,509
Non-interested trustees' compensation 8,715
Total expenses before reductions 2,191,224
Expense reductions (48,551) 2,142,673
NET INTEREST INCOME 20,924,467
REALIZED AND UNREALIZED GAIN (LOSS)
Net realized gain (loss) on:
Investment securities 1,034,257
Futures contracts 396,497 1,430,754
Change in net unrealized appreciation (depreciation) on:
Investment securities 1,320,125
Futures contracts 13,946 1,334,071
NET GAIN (LOSS) 2,764,825
NET INCREASE (DECREASE) IN NET ASSETS RESULTING $ 23,689,292
FROM OPERATIONS
</TABLE>
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
<S> <C> <C>
YEAR ENDED YEAR ENDED
FEBRUARY 28, FEBRUARY 29,
1997 1996
INCREASE (DECREASE) IN NET ASSETS
Operations $ 20,924,467 $ 22,267,955
Net interest income
Net realized gain (loss) 1,430,754 (167,688)
Change in net unrealized appreciation (depreciation) 1,334,071 19,615,441
NET INCREASE (DECREASE) IN NET ASSETS RESULTING 23,689,292 41,715,708
FROM OPERATIONS
Distributions to shareholders (20,973,796) (22,267,955)
From net interest income
From net realized gain (77,905) -
TOTAL DISTRIBUTIONS (21,051,701) (22,267,955)
Share transactions 46,639,557 51,893,617
Net proceeds from sales of shares
Reinvestment of distributions 16,494,304 17,497,697
Cost of shares redeemed (73,490,444) (75,426,818)
Redemption fees 21,059 28,650
NET INCREASE (DECREASE) IN NET ASSETS RESULTING (10,335,524) (6,006,854)
FROM SHARE TRANSACTIONS
TOTAL INCREASE (DECREASE) IN NET ASSETS (7,697,933) 13,440,899
NET ASSETS
Beginning of period 409,201,145 395,760,246
End of period (including undistributed net interest $ 401,503,212 $ 409,201,145
income of $0 and $49,329, respectively)
OTHER INFORMATION
Shares
Sold 4,490,938 5,015,350
Issued in reinvestment of distributions 1,584,913 1,696,585
Redeemed (7,073,997) (7,327,672)
Net increase (decrease) (998,146) (615,737)
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
FINANCIAL HIGHLIGHTS
YEAR ENDED YEAR ENDED YEARS ENDED FEBRUARY TEN MONTHS
FEBRUARY 28, FEBRUARY 28, ENDED
29, FEBRUARY
28,
1997 1996 1995 1994 C 1993
SELECTED PER-SHARE DATA
Net asset value, beginning $ 10.520 $ 10.020 $ 10.930 $ 11.330 $ 10.540
of period
Income from Investment .548 .571 .603 .631 .543
Operations
Net interest income
Net realized and unrealized .082 .498 (.732) (.012) .858
gain (loss)
Total from investment .630 1.069 (.129) .619 1.401
operations
Less Distributions
From net interest income (.549) (.570) (.603) (.631) (.543)
From net realized gain (.002) - (.180) (.330) (.070)
In excess of net realized gain - - - (.060) -
Total distributions (.551) (.570) (.783) (1.021) (.613)
Redemption fees added to paid .001 .001 .002 .002 .002
in capital
Net asset value, end of period $ 10.600 $ 10.520 $ 10.020 $ 10.930 $ 11.330
TOTAL RETURN B 6.23% 10.94% (.85)% 5.63% 13.76%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 401,503 $ 409,201 $ 395,760 $ 566,613 $ 573,871
(000 omitted)
Ratio of expenses to average .55% .54% .55% .52% .40% A,
net assets D D D
Ratio of expenses to average net .54% .54% .55% .52% .40% A
assets after expense E
reductions
Ratio of net interest income to 5.25% 5.57% 6.04% 5.58% 6.07% A
average net assets
Portfolio turnover rate 23% 38% 30% 54% 26% A
</TABLE>
C ANNUALIZED
C TOTAL RETURNS DO NOT INCLUDE THE FORMER ACCOUNT CLOSEOUT FEE AND FOR
PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED. THE TOTAL RETURNS WOULD
HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN REDUCED DURING THE PERIODS
SHOWN.
C EFFECTIVE MARCH 1,1993, THE FUND ADOPTED STATEMENT OF POSITION 93-2,
"DETERMINATION, DISCLOSURE, AND FINANCIAL STATEMENT PRESENTATION OF INCOME,
CAPITAL GAIN, AND RETURN OF CAPITAL DISTRIBUTIONS BY INVESTMENT COMPANIES."
AS A RESULT, NET INTEREST INCOME PER SHARE MAY REFLECT CERTAIN
RECLASSIFICATIONS RELATED TO BOOK TO TAX DIFFERENCES.
C FMR AGREED TO REIMBURSE A PORTION OF THE FUND'S EXPENSES DURING THE
PERIOD. WITHOUT THIS REIMBURSEMENT, THE FUND'S EXPENSE RATIO WOULD HAVE
BEEN HIGHER.
C FMR OR THE FUND HAS ENTERED INTO VARYING ARRANGEMENTS WITH THIRD PARTIES
WHO EITHER PAID OR REDUCED A PORTION OF THE FUND'S EXPENSES (SEE NOTE 5 OF
NOTES TO FINANCIAL STATEMENTS).
SPARTAN CALIFORNIA INTERMEDIATE MUNICIPAL INCOME FUND
PERFORMANCE: THE BOTTOM LINE
There are several ways to evaluate a fund's historical performance. You can
look at the total percentage change in value, the average annual percentage
change, or the growth of a hypothetical $10,000 investment. Total return
reflects the change in the value of an investment, assuming reinvestment of
the fund's dividend income and capital gains (the profits earned upon the
sale of securities that have grown in value). You can also look at the
fund's income, as reflected in the fund's yield, to measure performance. If
Fidelity had not reimbursed certain fund expenses, the life of fund total
returns and dividends would have been lower.
CUMULATIVE TOTAL RETURNS
<TABLE>
<CAPTION>
<S> <C> <C>
PERIODS ENDED FEBRUARY 28, 1997 PAST 1 LIFE OF
YEAR FUND
Spartan California Intermediate Municipal Income 4.96% 15.99%
Lehman Brothers California 1-17 Year 5.05% n/a
Municipal Bond Index
California Intermediate Municipal Debt Funds 4.29% n/a
Average
</TABLE>
CUMULATIVE TOTAL RETURNS show the fund's performance in percentage terms
over a set period - in this case, one year, or since the fund started on
December 30, 1993. For example, if you invested $1,000 in a fund that had a
5% return over the past year, the value of your investment would be $1,050.
You can compare the fund's returns to the performance of the Lehman
Brothers California 1-17 Year Municipal Bond Index - a total return
performance benchmark for California investment-grade municipal bonds with
maturities between one and 17 years. To measure how the fund's performance
stacks up against its peers, you can compare it to the California
intermediate municipal debt funds average, which reflects the performance
of 29 mutual funds with similar objectives tracked by Lipper Analytical
Services over the past one year. Both benchmarks include reinvested
dividends and capital gains, if any, and exclude the effect of sales
charges.
AVERAGE ANNUAL TOTAL RETURNS
<TABLE>
<CAPTION>
<S> <C> <C>
PERIODS ENDED FEBRUARY 28, 1997 PAST 1 LIFE OF
YEAR FUND
Spartan California Intermediate Municipal Income 4.96% 4.79%
Lehman Brothers California 1-17 Year 5.05% n/a
Municipal Bond Index
California Intermediate Municipal Debt Funds 4.29% n/a
Average
</TABLE>
AVERAGE ANNUAL TOTAL RETURNS take the fund's cumulative return and show you
what would have happened if the fund had performed at a constant rate each
year. (Note: Lipper calculates average annual total returns by annualizing
each fund's total return, then taking an arithmetic average. This may
produce a slightly different figure than that obtained by averaging the
cumulative total returns and annualizing the result.)
$10,000 OVER LIFE OF FUND
IMAHDR PRASUN SHR__CHT 19960930 19961009 151627 S00000000000001
Spartan CA Int Muni LB Municipal Bond Index
00432 LB015
1993/12/31 10000.00 10000.00
1994/01/31 10114.46 10114.20
1994/02/28 9828.19 9852.24
1994/03/31 9522.27 9451.06
1994/04/30 9579.71 9531.20
1994/05/31 9659.48 9613.84
1994/06/30 9607.30 9555.10
1994/07/31 9783.77 9730.24
1994/08/31 9816.77 9763.91
1994/09/30 9713.91 9620.58
1994/10/31 9559.65 9449.71
1994/11/30 9394.31 9278.86
1994/12/31 9532.70 9483.09
1995/01/31 9774.19 9754.12
1995/02/28 9992.53 10037.77
1995/03/31 10067.59 10153.10
1995/04/30 10078.44 10165.08
1995/05/31 10389.38 10489.45
1995/06/30 10291.45 10398.19
1995/07/31 10419.57 10496.77
1995/08/31 10560.65 10629.87
1995/09/30 10625.07 10697.15
1995/10/31 10767.07 10852.69
1995/11/30 10919.50 11032.74
1995/12/31 10975.50 11138.76
1996/01/31 11075.45 11222.86
1996/02/29 11049.70 11147.10
1996/03/31 10915.23 11004.64
1996/04/30 10902.00 10973.50
1996/05/31 10889.28 10969.11
1996/06/30 10987.55 11088.57
1996/07/31 11075.95 11189.47
1996/08/31 11085.25 11186.79
1996/09/30 11196.12 11343.40
1996/10/31 11343.15 11471.69
1996/11/30 11535.09 11681.63
1996/12/31 11489.39 11632.56
1997/01/31 11522.67 11654.55
1997/02/28 11598.21 11761.54
IMATRL PRASUN SHR__CHT 19960930 19961009 151629 R00000000000123
$10,000 OVER LIFE OF FUND: Let's say hypothetically that $10,000 was
invested in Spartan California Intermediate Municipal Income Fund on
December 31, 1993, shortly after the fund started. As the chart shows, by
February 28, 1997, the value of the investment would have grown to $11,598
- - a 15.98% increase on the initial investment. For comparison, look at how
the Lehman Brothers Municipal Bond Index, which reflects the performance of
the investment-grade municipal bond market, did over the same period. With
dividends reinvested, the same $10,000 would have grown to $11,762 - a
17.62% increase.
UNDERSTANDING
PERFORMANCE
How a fund did yesterday is
no guarantee of how it will do
tomorrow. Bond prices, for
example, generally move in
the opposite direction of
interest rates. In turn, the
share price, return, and yield of
a fund that invests in bonds
will vary. That means if you
sell your shares during a
market downturn, you might
lose money. But if you can ride
out the market's ups and
downs, you may have a gain.
(checkmark)
TOTAL RETURN COMPONENTS
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
YEAR ENDED YEAR ENDED YEAR ENDED DECEMBER 30,
FEBRUARY FEBRUARY FEBRUARY 1993
28, 29, 28, (COMMENCEMENT
OF OPERATIONS) TO
FEBRUARY 28,
1997 1996 1995 1994
Dividend returns 4.73% 5.28% 5.05% 0.69%
Capital appreciation returns 0.23% 5.29% -3.39% -2.41%
Total returns 4.96% 10.57% 1.66% -1.72%
</TABLE>
TOTAL RETURN COMPONENTS include both dividend returns and capital
appreciation returns. A dividend return reflects the actual dividends paid
by the fund. A capital appreciation return reflects both the amount paid by
the fund to shareholders as capital gain distributions and changes in the
fund's share price. Both returns assume the dividends or capital gains paid
by the fund are reinvested. For periods through February 29, 1996, capital
appreciation and total returns include the effect of a $5 account closeout
fee on an average size account.
DIVIDENDS AND YIELD
<TABLE>
<CAPTION>
<S> <C> <C> <C>
PERIODS ENDED FEBRUARY 28, 1997 PAST PAST 6 PAST 1
MONTH MONTHS YEAR
Dividends per share 3.50(cents) 22.52(cents) 45.38(cents)
Annualized dividend rate 4.58% 4.59% 4.63%
30-day annualized yield 4.36% - -
30-day annualized tax-equivalent yield 7.51% - -
</TABLE>
DIVIDENDS per share show the income paid by the fund for a set period. If
you annualize this number, based on an average share price of $9.97 over
the past month, $9.89 over the past six months, and $9.81 over the past
year, you can compare the fund's income over these three periods. Dividends
per share show the income paid by the fund for a set period and do not
reflect any tax reclassifications. The 30-day annualized YIELD is a
standard formula for all funds based on the yields of the bonds in the
fund, averaged over the past 30 days. This figure shows you the yield
characteristics of the fund's investments at the end of the period. It also
helps you compare funds from different companies on an equal basis. The
tax-equivalent yield shows what you would have to earn on a taxable
investment to equal the fund's tax-free yield, if you're in the 41.95%
combined effective 1997 federal and state income tax bracket, but does not
reflect payment of the federal alternative minimum tax, if applicable.
SPARTAN CALIFORNIA INTERMEDIATE MUNICIPAL INCOME FUND
FUND TALK: THE MANAGER'S OVERVIEW
MARKET RECAP
Stable demand helped municipal
bonds perform better than their
investment-grade taxable
counterparts in the 12 months
ending February 28, 1997.
However, anticipation of
short-term interest rate increases
by the Federal Reserve Board
negatively affected all bonds. For
the period, the Lehman
Brothers Municipal Bond Index
- - a broad measure of the
municipal bond market - had a
total return of 5.51%. In
comparison, the Lehman Brothers
Aggregate Bond Index - a
broad measure of the
performance of the U.S. taxable
bond market - returned 5.35%.
New issue supply in the municipal
market was strong through the
first half of the period, but
insurance companies and
individual investors helped sustain
demand. The diminishing
likelihood of significant tax reform
in the near future also helped
support the muni market. Like
most domestic bonds, munis were
affected by signs of strength in the
economy in the first half of 1996.
Nevertheless, the market
conditions that supported the
muni market helped it enter the fall
trading at expensive levels
relative to its taxable counterparts.
Munis stalled because their rich
valuations inhibited demand and
encouraged selling. From
December on, most bond
markets suffered from fears -
confirmed by Fed Chairman Alan
Greenspan's testimony before
Congress in late February - that
latent inflation pressures might
encourage the Fed to raise
short-term rates. Munis, however,
outperformed over the past few
months, in part because of a thin
supply of new issues.
(Portfolio Manager: Jonathan Short photograph)
An interview with Jonathan Short, Portfolio Manager of Spartan California
Intermediate Municipal Income Fund
Q. HOW DID THE FUND PERFORM, JON?
A. For the year ending February 28, 1997, the fund had a total return of
4.96%. For comparison purposes, the California intermediate municipal debt
funds average, as tracked by Lipper Analytical Services, returned 4.29%,
and the Lehman Brothers California 1-17 Year Municipal Bond Index returned
5.05% for the same period.
Q. WHAT HELPED THE FUND PERFORM BETTER THAN ITS COMPETITORS?
A. Baa-rated securities were some of the market's - and the fund's - best
performers and were a key reason why the fund fared better than many of its
competitors. The main driver for the strong returns of Baa-rated bonds was
tightening credit spreads. Credit spreads refer to the difference in yield
between bonds carrying the lowest investment-grade rating of Baa and those
with the highest credit rating of Aaa. As spreads tightened, lower-quality
bonds' yields fell relative to higher-quality bonds during the period. As a
result, lower-quality bonds generally performed better than higher-quality
issues. Additionally, Sequoia Hospital was boosted by its merger with
Catholic Health Care West.
Q. GENERAL OBLIGATION BONDS (GOS) MADE UP THE FUND'S LARGEST SECTOR
CONCENTRATION AT THE END OF THE PERIOD. WHICH TYPES OF GOS DID YOU TARGET?
A. A large portion of the fund's stake in GOs are state general obligation
bonds, which are issued by the state, backed by its full faith and credit,
and are repaid by general revenue, in contrast to revenue from a specific
facility or project built with borrowed funds. In my opinion, the state's
credit worthiness has improved as its economy has rebounded. In fact,
revenue collections have improved to the point where estimates call for the
state's budget to post $1 billion more in revenues than originally
projected.
Q. WHAT FACTORS DID YOU CONSIDER WHEN DETERMINING THE OVERALL STRUCTURE OF
THE PORTFOLIO?
A. I placed a lot of emphasis on the price breakdown of the bonds. I prefer
to have a lighter position in callable "par" bonds - those with prices
between $97 and $103 - and a heavier weighting in discount and premium
bonds with prices below $97 or above $103, respectively. The main reason
for this strategy was that I felt that par bonds are more susceptible to
call risk, where the issuer can redeem an issue before its maturity. I also
looked for bonds with good "call protection." When interest rates fall,
municipal issuers often call - or redeem - bonds before their maturity and
issue new bonds as a way to lower their interest costs. So I focus on bonds
with good call protection - those that have some longer period of time
before they legally can be called away - and non-callable bonds, which
can't be redeemed by their issuer before maturity.
Q. WHAT'S YOUR OUTLOOK?
A. From a supply and demand standpoint, I'm optimistic about municipals. I
don't expect to see a tremendous amount of new bonds issued. And the
increase in supply we're likely to see should be easily digested if demand
remains firm. But how municipals fare over the next six months or so will
depend heavily on the direction of interest rates, and I don't think anyone
can accurately pinpoint where interest rates will be a year from now. That
said, we may continue to see some volatility in the bond market as long as
there are conflicting signs about the economy and inflation trends.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO MANAGER
ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON THE COVER.
THE MANAGER'S VIEWS ARE SUBJECT TO CHANGE AT ANY TIME BASED ON MARKET AND
OTHER CONDITIONS.
FUND FACTS
GOAL: high current income for
California residents by
normally investing in
investment-grade municipal
securities whose interest is
free from federal income
tax and California personal
income tax
FUND NUMBER: 432
TRADING SYMBOL: FSCMX
START DATE: December 30,
1993
SIZE: as of February 28,
1997, more than $74 million
MANAGER: Jonathan Short,
since 1995; manager, Spartan
Florida Municipal Income,
since 1996; Fidelity Advisor
California Municipal Income
and Spartan Arizona
Municipal Income, since 1995;
Spartan California Municipal
Income, Fidelity California
Municipal Income, Fidelity
California Insured Municipal
Income and Fidelity
Minnesota Municipal
Income, since 1995; joined
Fidelity in 1990
(checkmark)
JONATHAN SHORT ON
CALIFORNIA'S ECONOMY:
"The strength of California's
economic rebound is an
important component in the
overall performance of
California municipal bonds.
For a number of reasons, I
am optimistic about
California's economy. The
first is employment growth,
which continues to outpace
the nation as a whole.
Second, the state budget is
posting revenues well
ahead of projections, thanks
mostly to rising tax
collections. Third, the
rebound has grown to be
more broad-based, with
southern California finally
showing improvements after
lagging behind the northern
part of the state. Finally,
permits to build new houses
are up about 15% this year
and sales of existing homes
seem to have stabilized."
SPARTAN CALIFORNIA INTERMEDIATE MUNICIPAL INCOME FUND
INVESTMENT CHANGES
TOP FIVE SECTORS AS OF FEBRUARY 28, 1997
% OF FUND'S % OF FUND'S INVESTMENT
INVESTMENTS S
IN THESE SECTORS
6 MONTHS AGO
General Obligation 28.7 29.7
Special Tax 15.8 15.4
Water & Sewer 13.2 13.4
Escrowed/Pre-Refunded 8.5 8.3
Health Care 7.5 10.7
AVERAGE YEARS TO MATURITY AS OF FEBRUARY 28, 1997
6 MONTHS AGO
Years 8.8 8.4
AVERAGE YEARS TO MATURITY IS BASED ON THE AVERAGE TIME UNTIL PRINCIPAL
PAYMENTS ARE EXPECTED FROM EACH OF THE FUND'S BONDS, WEIGHTED BY DOLLAR
AMOUNT.
DURATION AS OF FEBRUARY 28, 1997
6 MONTHS AGO
Years 5.9 5.9
DURATION SHOWS HOW MUCH A BOND FUND'S PRICE FLUCTUATES WITH CHANGES IN
COMPARABLE INTEREST RATES. IF RATES RISE 1%, FOR EXAMPLE, A FUND WITH A
FIVE-YEAR DURATION IS LIKELY TO LOSE ABOUT 5% OF ITS VALUE. OTHER FACTORS
ALSO CAN INFLUENCE A BOND FUND'S PERFORMANCE AND SHARE PRICE. ACCORDINGLY,
A BOND FUND'S ACTUAL PERFORMANCE MAY DIFFER FROM THIS EXAMPLE.
QUALITY DIVERSIFICATION (MOODY'S RATINGS)
AS OF FEBRUARY 28, 1997 AS OF AUGUST 31, 1996
Aaa 46.7%
Aa, A 35.3%
Baa 13.3%
Ba, B 0.0%
Non-rated 0.0%
Short-term
investments 4.7%
Aaa 50.8%
Aa, A 35.5%
Baa 9.4%
Ba, B 0.0%
Non-rated 0.0%
Short-term
investments 4.3%
Row: 1, Col: 1, Value: 46.7
Row: 1, Col: 2, Value: 35.3
Row: 1, Col: 3, Value: 13.3
Row: 1, Col: 4, Value: 0.0
Row: 1, Col: 5, Value: 0.0
Row: 1, Col: 6, Value: 4.7
Row: 1, Col: 1, Value: 50.8
Row: 1, Col: 2, Value: 35.5
Row: 1, Col: 3, Value: 9.4
Row: 1, Col: 4, Value: 0.0
Row: 1, Col: 5, Value: 0.0
Row: 1, Col: 6, Value: 4.3
SHOWN AS A PERCENTAGE OF THE FUND'S INVESTMENTS. WHERE MOODY'S RATINGS ARE
NOT AVAILABLE, WE HAVE USED S&P RATINGS.
SPARTAN CALIFORNIA INTERMEDIATE MUNICIPAL INCOME FUND
INVESTMENTS FEBRUARY 28, 1997
Showing Percentage of Total Value of Investments in Securities
<TABLE>
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MUNICIPAL BONDS - 95.3%
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (B) AMOUNT (NOTE 1)
CALIFORNIA - 95.3%
California Dept. Wtr. Resources Wtr. Sys. Rev.
(Central Valley Proj.):
Series I, 6.95% 12/1/25
(Pre-Refunded to 6/1/00 @ 101.50) (d) Aaa $ 500,000 $ 548,750
Series J-2, 5.50% 12/1/01 Aa 500,000 523,750
California Edl. Facs. Auth. Rev. Rfdg.
(Univ. of Southern California)
Series A, 5.70% 10/1/15 (f) Aa3 1,000,000 980,000
California Gen. Oblig.:
6.40% 2/1/06 A1 575,000 641,125
6.40% 9/1/07 A1 1,000,000 1,122,500
6% 10/1/08 A1 425,000 462,719
6.50% 9/1/10 A1 1,000,000 1,127,500
7% 10/1/10 A1 500,000 588,125
6.25% 10/1/19 A1 1,040,000 1,137,500
California Hsg. Fin. Agcy. Rev. (Home Mtg.):
Series L, 5.70% 8/1/25 (MBIA Insured) (c) Aaa 1,000,000 1,002,500
Series R, 5.25% 8/1/16 (MBIA Insured) Aaa 1,200,000 1,194,000
California Pub. Wks. Board Lease Rev.:
Rfdg. (California State Univ. Proj.) Series A,
5.50% 6/1/14 A1 1,000,000 993,750
Rfdg. (Dept. Correction State Prison, Monterey
County) Series D, 5.375% 11/1/12 A 1,250,000 1,234,375
(California Univ. Proj.) Series A:
6.10% 10/1/06 (e) A 1,210,000 1,309,825
6.30% 10/1/10 A 1,000,000 1,077,500
(Dept. Corrections State Prison) (Central
California Womens Fac. Madera County)
Series A, 7% 9/1/02
(Pre-Refunded to 9/1/00 @ 102) (d) Aaa 500,000 554,375
(Dept. Correction State Prisons, Madera):
Series E, 6% 6/1/07 A 590,000 630,563
7% 9/1/00 A 1,000,000 1,082,500
California Statewide Commtys. Dev. Auth.
Rev. Ctfs. of Prtn. Rfdg.:
5.25% 8/1/97 A+ 250,000 250,313
5.90% 8/1/01 A+ 200,000 204,000
6.25% 8/1/06 A+ 1,000,000 1,048,750
California Univ. Rev. Rfdg. (Multiple Purp.
Projs.) Series C, 9% 9/1/02 (AMBAC Insured) Aaa 100,000 121,500
Carson Redev. Agcy. Rfdg. (Redev. Proj. Area #2)
(Tax Allocation) 5.50% 10/1/02 Baa 100,000 100,125
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (B) AMOUNT (NOTE 1)
CALIFORNIA - CONTINUED
Castaic Lake Wtr. Agcy. Ctfs. of Prtn.
(Wtr. Sys. Impt. Proj.) Series A, 7.25%
8/1/07 (MBIA Insured) Aaa $ 1,755,000 $ 2,086,256
Central California Joint Pwrs. Health Fing.
Auth. Ctfs. of Prtn. Rfdg. (Commty. Hosps.
of Central California) 5.25% 2/1/04 Baa1 1,000,000 980,000
Central Valley Fin. Auth. Cogeneration Proj.
Rev. (Carson Ice Gen. Proj.) 5.50% 7/1/01 BBB- 1,400,000 1,429,750
Chino Basin Fing. Auth. Rev. Rfdg. (Muni.
Wtr. Dist. Swr. Sys. Proj.):
7% 8/1/05 (AMBAC Insured) Aaa 1,185,000 1,371,638
7% 8/1/09 (AMBAC Insured) Aaa 350,000 409,938
Clovis Unified School Dist. Series B, 0%
8/1/02 (MBIA Insured) Aaa 300,000 233,625
Contra Costa Trans. Auth. Sales Tax Rev.
Series A:
6% 3/1/03 (FGIC Insured) Aaa 530,000 572,400
6% 3/1/08 (FGIC Insured) Aaa 1,000,000 1,087,500
Duarte Ctfs. of Prtn. (City of Hope Nat'l.
Med. Ctr.) 6% 4/1/08 Baa1 1,200,000 1,213,500
East Bay Regional Park Dist.:
Series B, 6.10% 9/1/06 Aa 300,000 317,625
Series C, 6.50% 9/1/01 (FGIC Insured) Aaa 500,000 543,750
Elk Grove Unified School Dist. Spl. Tax Rfdg.
(Commty. Facs. Dist. #1) 6.50%
12/1/07 (AMBAC Insured) Aaa 500,000 567,500
Encintas Unified School Dist. (Cap.
Appreciation) 0% 8/1/04 (MBIA Insured) Aaa 500,000 347,500
Escondido Joint Pwrs. Fing. Auth. Lease Rev.
Rfdg. (California Ctr. for the Arts) 0%
9/1/04 (AMBAC Insured) Aaa 570,000 396,150
Foothill/Eastern Trans. Corridor Agcy.
(California Toll Rd. Rev.) Sr. Lien Series
A, 0% 1/1/04 Baa 1,600,000 1,092,000
Foster City Pub. Fing. Auth. Rev. Commty.
Dev. Proj. Series A, 5.50% 9/1/09 A- 370,000 368,613
Fremont Unified School Dist. Alameda County
(Cap. Appreciation) Series F, 0%
8/1/09 (MBIA Insured) Aaa 1,000,000 508,750
Inglewood Hosp. Rev. (Daniel Freeman Hosp.
Inc.) 6.50% 5/1/01 A 1,000,000 1,057,500
La Quinta Redev. Agcy. Tax Alloc. Rfdg.
(Redev. Proj. Area #1):
7.30% 9/1/06 (MBIA Insured) Aaa 620,000 736,250
7.30% 9/1/11 (MBIA Insured) Aaa 555,000 668,775
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (B) AMOUNT (NOTE 1)
CALIFORNIA - CONTINUED
Long Beach Harbor Rev. (c):
5.75% 5/15/07 (MBIA Insured) Aaa $ 1,000,000 $ 1,050,000
5.50% 5/15/11 (MBIA Insured) Aaa 700,000 701,750
Los Angeles County Metropolitan Trans.
Auth. (Sales Tax Rev.):
Rfdg. (Prop. A) Series A, 5.30% 7/1/05
(MBIA Insured) Aaa 2,000,000 2,080,000
(Prop. C) Second Series A:
5.90% 7/1/08 (AMBAC Insured) Aaa 500,000 542,500
5.90% 7/1/02 (AMBAC Insured) Aaa 1,200,000 1,285,500
Series A, 6.75% 7/1/11
(Pre-Refunded to 7/1/01 @ 102) (d) Aaa 1,250,000 1,392,188
Los Angeles Dept. Arpt. Rev.
(Los Angeles Int'l. Arpt.) Series D, 5.625%
5/15/12 (FGIC Insured) (c) Aaa 1,000,000 1,003,750
Los Angeles Dept. of Wtr. & Pwr. Rev.
(Elec. Plant) Second Issue, 9% 10/15/01 Aa 110,000 130,763
Los Angeles Wastewater Sys. Rev. Rfdg.
Series A, 9% 6/1/00 (MBIA Insured) Aaa 500,000 570,000
Madera County Ctfs. of Prtn. (Valley Children's
Hosp.) 6.25% 3/15/05 (MBIA Insured) Aaa 480,000 525,600
Manhattan Beach Unified School Dist. Series A,
0% 9/1/09 (FGIC Insured) Aaa 975,000 497,250
Metropolitan Wtr. Dist. Southern California
Crossover Rfdg. Series A-2, 5% 3/1/02 Aaa 250,000 258,125
Northern California Pwr. Agcy. Pub. Pwr. Rev.
Rfdg. (Geothermal Proj. #3-B) 5.50%
7/1/01 (AMBAC Insured) Aaa 500,000 522,500
Ontario Redev. Fing. Auth. Rev. Rfdg.
(Ontario Redev. Proj. #1) 6.65%
8/1/07 (MBIA Insured) Aaa 500,000 572,500
Orange County Wtr. Dist. Ctfs. of Prtn.,
Series A, 5.50% 8/15/09 (AMBAC Insured) Aaa 1,000,000 1,015,000
Port Oakland Port Rev. Rfdg. Series F, 0%
11/1/05 (MBIA Insured) Aaa 300,000 196,125
Rancho Wtr. Dist. Fing. Auth. Rev. Rfdg.:
6.50% 11/1/00 (FGIC Insured) Aaa 1,315,000 1,413,625
6.50% 11/1/03 (FGIC Insured) Aaa 1,300,000 1,443,000
Riverside County Asset Leasing Corp. Leasehold
Rev. (Riverside County Hosp. Proj.)
Series A, 6% 6/1/03 A3 2,000,000 2,090,000
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (B) AMOUNT (NOTE 1)
CALIFORNIA - CONTINUED
Rosemead Redev. Agcy. (Sub. Lien Tax Allocation
Proj. Area 1) 0% 10/1/98
(Escrowed to Maturity) (d) A- $ 1,120,000 $ 1,050,000
Roseville Joint Unified High School Dist.
Series B, 0% 8/1/00 (FGIC Insured) Aaa 1,060,000 912,925
Sacramento City Fing. Auth. (Gas Tax Rev.)
Series A, 6.75% 12/1/08 (AMBAC Insured) Aaa 1,475,000 1,699,938
Sacramento Cogeneration Auth. Cogeneration
Proj. Rev. (Proctor & Gamble Proj.)
7% 7/1/05 BBB- 1,500,000 1,661,250
San Bernadino County Ctfs. of Prtn. Rfdg.
(Med. Ctr. Fing. Proj.) 5.25% 8/1/04 Baa1 915,000 917,288
San Diego County Regional Trans. Commission
Sales Tax Rev. Second Series A, 6.25%
4/1/03 (FGIC Insured) Aaa 1,000,000 1,091,250
San Francisco Bldg. Auth. Lease Rev. Dept.
Gen. Svcs. Lease Series A, 5% 10/1/05 A 400,000 403,500
San Francisco City & County Gen. Oblig.
Series 95 A & B, 6.50% 6/15/03
(FGIC Insured) Aaa 680,000 748,850
San Francisco City & County Pub. Utils. Wtr.
Rev. Crossover Rfdg. Series A,
6.50% 11/1/09 Aa 1,000,000 1,095,000
San Francisco Port Comm. Rev. Rfdg.
5.50% 7/1/04 A 1,000,000 1,025,000
San Joaquin County Ctfs. of Prtn.
(General Hosp. Proj.):
5.70% 9/1/01 A 250,000 255,938
5.80% 9/1/02 A 350,000 360,063
Santa Barbara Ctfs. of Prtn. Rfdg.
5.10% 3/1/03 A1 1,000,000 1,001,250
Santa Barbara Redev. Agcy. Tax Allocation 6%
3/1/05 (AMBAC Insured) Aaa 500,000 542,500
Santa Margarita/Dana Point Auth. Rev. Rfdg.
(Impt. Dists 1-2-2A & 8) Series A,
7.25% 8/1/06 (MBIA Insured) Aaa 1,500,000 1,773,750
Sequoia Hosp. Dist. Rev. Rfdg. (d):
4.90% 8/15/02 (Escrowed to Maturity) Baa 1,225,000 1,251,031
5% 8/15/03 (Escrowed to Maturity) Baa 1,285,000 1,317,125
Southern California Pub. Pwr. Auth. Pwr. Proj.
Rev. Series 11, 0% 7/1/15
(Pre-Prefunded to 7/1/00 @ 101) (d) Aaa 300,000 262,500
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS PRINCIPAL VALUE
(UNAUDITED) (B) AMOUNT (NOTE 1)
CALIFORNIA - CONTINUED
West Covina Ctfs. of Prtn. (Queen of the
Valley Hosp.):
5.90% 8/15/02 A2 $ 875,000 $ 913,281
6% 8/15/03 A2 925,000 972,401
6.125% 8/15/04 A2 980,000 1,037,575
TOTAL MUNICIPAL BONDS
(Cost $69,427,797) 71,507,656
MUNICIPAL NOTES (A) - 4.7%
CALIFORNIA - 4.7%
California Poll. Cont. Fin. Auth. Poll. Cont.
Rev. Rfdg.
(Pacific Gas & Elec.) Series C,
3.40%, LOC Bank of America NT & SA,
VRDN A-1+ 1,000,000 1,000,000
California Poll. Cont. Fing. Auth. Resource
Recovery Rev., VRDN (c):
(Burney Forest Prod. Proj.) 3.35%,
LOC Fleet Nat'l. Bank P-1 700,000 700,000
(Ultra Pwr. Rocklin Proj.) Series 1988 A,
3.45%, LOC Bank of America NT & SA P-1 500,000 500,000
Chula Vista Ind. Dev. Rev. Rfdg. (San Diego
Gas & Elec. Co.) Series B, 3.60%, VRDN (c) P-1 300,000 300,000
Los Angeles Gen. Oblig. TRAN Series 1996-1997,
4.50% 6/30/97 MIG 1 1,000,000 1,002,950
TOTAL MUNICIPAL NOTES
(Cost $3,502,950) 3,502,950
TOTAL INVESTMENTS - 100%
(Cost $72,930,747) $75,010,606
FUTURES CONTRACTS
EXPIRATION UNDERLYING FACE UNREALIZED
DATE AMOUNT AT VALUE GAIN/(LOSS)
PURCHASED
4 Municipal Bond Contracts June 1997 $ 456,875 $ (1,161)
</TABLE>
THE FACE VALUE OF FUTURES PURCHASED AS A PERCENTAGE OF TOTAL INVESTMENT IN
SECURITIES - 0.6%
SECURITY TYPE ABBREVIATIONS
TRAN - Tax Revenue Anticipation Notes
VRDN - Variable Rate Demand Notes
LEGEND
(a) The coupon rate shown on floating or adjustable rate securities
represents the rate at period end.
(b) Standard & Poor's credit ratings are used in the absence of a rating by
Moody's Investors Service, Inc.
(c) Private activity obligations whose interest is subject to the federal
alternative minimum tax for individuals.
(d) Security collateralized by an amount sufficient to pay interest and
principal.
(e) A portion of the Security was pledged to cover margin requirements for
futures contracts. At the period end, the value of securities pledged
amounted to $1,082,500.
(f) Security purchased on a delayed delivery basis (see Note 2 of Notes to
Financial Statements).
OTHER INFORMATION
The composition of long-term debt holdings as a percentage of total value
of investment in securities, is as follows (ratings are unaudited):
MOODY'S RATINGS S&P RATINGS
Aaa, Aa, A 76.7% AAA, AA, A 81.9%
Baa 9.2% BBB 10.5%
Ba 0.0% BB 0.0%
B 0.0% B 0.0%
Caa 0.0% CCC 0.0%
Ca, C 0.0% CC, C 0.0%
D 0.0%
The percentage not rated by both S&P and Moody's amounted to 0.0%.
The distribution of municipal securities by revenue source, as a percentage
of total value of investment in securities, is as follows:
General Obligation 28.7%
Special Tax 15.8
Water and Sewer 13.2
Escrowed/Pre-Refunded 8.5
Health Care 7.5
Transportation 6.8
Electric Revenue 6.7
Lease Revenue 6.7
Others (individually less than 5%) 6.1
TOTAL 100.0%
INCOME TAX INFORMATION
At February 28, 1997, the aggregate cost of investment securities for
income tax purposes was $72,930,747. Net unrealized appre-
ciation aggregated $2,079,859, of which $2,147,023 related to appreciated
investment securities and $67,164 related to depreciated investment
securities.
At February 28, 1997, the fund had a capital loss carryforward of
approximately $531,000 which will expire on February 28, 2003.
SPARTAN CALIFORNIA INTERMEDIATE MUNICIPAL INCOME FUND
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
<S> <C> <C>
FEBRUARY 28, 1997
ASSETS
Investment in securities, at value (cost $72,930,747) - $ 75,010,606
See accompanying schedule
Interest receivable 977,494
Receivable for daily variation on futures contracts 125
TOTAL ASSETS 75,988,225
LIABILITIES
Payable to custodian bank $ 9,901
Payable for investments purchased
Delayed delivery 978,848
Payable for fund shares redeemed 179,312
Distributions payable 52,813
Accrued management fee 31,444
Other payables and accrued expenses 206
TOTAL LIABILITIES 1,252,524
NET ASSETS $ 74,735,701
Net Assets consist of:
Paid in capital $ 73,199,224
Accumulated undistributed net realized gain (loss) on (542,221)
investments and foreign currency transactions
Net unrealized appreciation (depreciation) on 2,078,698
investments
NET ASSETS, for 7,509,522 shares outstanding $ 74,735,701
NET ASSET VALUE, offering price and redemption price per $9.95
share ($74,735,701 (divided by) 7,509,522 shares)
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
<S> <C> <C>
YEAR ENDED FEBRUARY 28, 1997
INTEREST INCOME $ 3,703,561
EXPENSES
Management fee $ 396,854
Non-interested trustees' compensation 503
Total expenses before reductions 397,357
Expense reductions (14,887) 382,470
NET INVESTMENT INCOME 3,321,091
REALIZED AND UNREALIZED GAIN (LOSS)
Net realized gain (loss) on:
Investment securities 121,408
Futures contracts (57,315) 64,093
Change in net unrealized appreciation (depreciation) on:
Investment securities 94,597
Futures contracts (2,633) 91,964
NET GAIN (LOSS) 156,057
NET INCREASE (DECREASE) IN NET ASSETS RESULTING $ 3,477,148
FROM OPERATIONS
</TABLE>
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
<S> <C> <C>
YEAR ENDED YEAR ENDED
FEBRUARY 28, FEBRUARY 29,
1997 1996
INCREASE (DECREASE) IN NET ASSETS
Operations $ 3,321,091 $ 2,732,937
Net interest income
Net realized gain (loss) 64,093 479,021
Change in net unrealized appreciation (depreciation) 91,964 2,234,218
NET INCREASE (DECREASE) IN NET ASSETS RESULTING 3,477,148 5,446,176
FROM OPERATIONS
Distributions to shareholders (3,326,818) (2,732,937)
From net interest income
From net realized gain (22,353) -
TOTAL DISTRIBUTIONS (3,349,171) (2,732,937)
Share transactions 34,326,389 48,603,881
Net proceeds from sales of shares
Reinvestment of distributions 2,683,021 2,118,660
Cost of shares redeemed (34,212,041) (27,396,571)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING 2,797,369 23,325,970
FROM SHARE TRANSACTIONS
TOTAL INCREASE (DECREASE) IN NET ASSETS 2,925,346 26,039,209
NET ASSETS
Beginning of period 71,810,355 45,771,146
End of period (including undistributed net interest $ 74,735,701 $ 71,810,355
income of $0 and $5,727, respectively)
OTHER INFORMATION
Shares
Sold 3,498,968 4,982,957
Issued in reinvestment of distributions 273,235 217,196
Redeemed (3,493,042) (2,822,894)
Net increase (decrease) 279,161 2,377,259
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
FINANCIAL HIGHLIGHTS
YEAR ENDED YEAR ENDED YEAR ENDED DECEMBER 30, 1993
FEBRUARY 28, FEBRUARY 29, FEBRUARY (COMMENCEMENT OF
28, OPERATIONS) TO
FEBRUARY 28,
1997 1996 1995 1994
SELECTED PER-SHARE DATA
Net asset value, beginning of period $ 9.930 $ 9.430 $ 9.760 $ 10.000
Income from Investment Operations .453 .478 .477 .070
Net interest income
Net realized and unrealized .024 .499 (.330) (.240)
gain (loss)
Total from investment operations .477 .977 .147 (.170)
Less Distributions
From net interest income (.454) (.477) (.477) (.070)
From net realized gain (.003) - - -
Total distributions (.457) (.477) (.477) (.070)
Net asset value, end of period $ 9.950 $ 9.930 $ 9.430 $ 9.760
TOTAL RETURN B 4.96% 10.58% 1.67% (1.71)%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 74,736 $ 71,810 $ 45,771 $ 22,713
(000 omitted)
Ratio of expenses to average .54% .24% C .05% C .00% C
net assets C
Ratio of expenses to average net .53% .24% .05% .00%
assets after expense reductions D
Ratio of net interest income to 4.60% 4.93% 5.16% 4.66% A
average net assets
Portfolio turnover rate 22% 35% 55% 0%
</TABLE>
C ANNUALIZED
C TOTAL RETURNS DO NOT INCLUDE THE FORMER ACCOUNT CLOSEOUT FEE AND FOR
PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED. THE TOTAL RETURNS WOULD
HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT BEEN REDUCED DURING THE PERIODS
SHOWN (SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS).
C FMR AGREED TO REIMBURSE A PORTION OF THE FUND'S EXPENSES DURING THE
PERIOD. WITHOUT THIS REIMBURSEMENT, THE FUND'S EXPENSE RATIO WOULD HAVE
BEEN HIGHER (SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS).
C FMR OR THE FUND HAS ENTERED INTO VARYING ARRANGEMENTS WITH THIRD PARTIES
WHO EITHER PAID OR REDUCED A PORTION OF THE FUND'S EXPENSES (SEE NOTE 5 OF
NOTES TO FINANCIAL STATEMENTS).
SPARTAN CALIFORNIA MUNICIPAL MONEY MARKET FUND
PERFORMANCE: THE BOTTOM LINE
To measure a money market fund's performance, you can look at either total
return or yield. Total return reflects the change in the value of an
investment, assuming reinvestment of the fund's dividend income and the
effect of the fund's $5 account closeout fee on an average size account.
Yield measures the income paid by a fund. Since a money market fund tries
to maintain a $1 share price, yield is an important measure of performance.
If Fidelity had not reimbursed certain fund expenses, the total returns
would have been lower.
CUMULATIVE TOTAL RETURNS
<TABLE>
<CAPTION>
<S> <C> <C> <C>
PERIODS ENDED FEBRUARY 28, 1997 PAST 1 PAST 5 LIFE OF
YEAR YEARS FUND
Spartan California Municipal Money Market 3.18% 15.99% 29.98%
California Tax-Free 2.87% 13.70% 25.70%
Money Market Funds Average
</TABLE>
CUMULATIVE TOTAL RETURNS show the fund's performance over a set period - in
this case, one year, five years or since the fund started on November 27,
1989. For example, if you invested $1,000 in a fund that had a 5% return
over the past year, the value of your investment would be $1,050. To
measure how the fund's performance stacked up against its peers, you can
compare it to the California tax-free money market funds average, which
reflects the performance of 46 California tax-free money market funds with
similar objectives tracked by IBC Financial Data, Inc. over the past one
year. (The periods covered by the IBC Financial Data, Inc. numbers are the
closest match to those covered by the fund.)
AVERAGE ANNUAL TOTAL RETURNS
<TABLE>
<CAPTION>
<S> <C> <C> <C>
PERIODS ENDED FEBRUARY 28, 1997 PAST 1 PAST 5 LIFE OF
YEAR YEARS FUND
Spartan California Municipal Money Market 3.18% 3.01% 3.68%
California Tax-Free 2.87% 2.60% 3.20%
Money Market Funds Average
</TABLE>
AVERAGE ANNUAL TOTAL RETURNS take the fund's cumulative return and show you
what would have happened if the fund had performed at a constant rate each
year.
YIELDS
3/3/97 12/2/96 9/2/96 6/3/96 2/26/96
Spartan California 3.08% 3.22% 3.22% 3.31% 3.06%
Municipal Money Market
If Fidelity had not reimburs 2.93% 3.07% 3.07% 3.16% 2.91%
ed
certain fund expenses
California Tax-Free Money 2.74% 2.95% 2.84% 2.95% 2.76%
Market Funds Average
Spartan California 5.31% 5.55% 5.55% 5.70% 5.27%
Municipal Money Market -
Tax-equivalent
If Fidelity had not reimburs 5.05% 5.29% 5.29% 5.44% 5.01%
ed
certain fund expenses
YIELD refers to the income paid by the fund over a given period. Yields for
money market funds are usually for seven-day periods, expressed as annual
percentage rates. A yield that assumes income earned is reinvested or
compounded is called an effective yield. The chart above shows the fund's
current seven-day yield at quarterly intervals over the past year. If the
advisor had not reimbursed certain fund expenses during the periods shown,
the yields would have been lower. You can compare these yields to the
California tax-free money market funds average as tracked by IBC Financial
Data, Inc. Or you can look at the fund's tax-equivalent yield, which is
based on a combined effective 1997 federal and state income tax rate of
41.95%. A portion of the funds income may be subject to the alternative
minimum tax.
A MONEY MARKET FUND'S TOTAL RETURNS AND YIELDS WILL VARY, AND REFLECT PAST
RESULTS RATHER THAN PREDICT FUTURE PERFORMANCE.
COMPARING
PERFORMANCE
Yields on tax-free investments
are usually lower than yields on
taxable investments.
However, a straight
comparison between the two
may be misleading because it
ignores the way taxes reduce
taxable returns. Tax-equivalent
yield - the yield you'd have to
earn on a similar taxable
investment to match the
tax-free yield - makes the
comparison more meaningful.
Keep in mind that the U.S.
Government neither insures
nor guarantees a money
market fund. In fact, there is no
assurance that a money
market fund will maintain a $1
share price.
(checkmark)
SPARTAN CALIFORNIA MUNICIPAL MONEY MARKET FUND
FUND TALK: THE MANAGER'S OVERVIEW
NOTE TO SHAREHOLDERS: Diane McLaughlin became Portfolio Manager of Spartan
California Municipal Money Market Fund on August 1, 1996.
(Portfolio Manager: Diane McLaughlin photograph)
Q. DIANE, WHAT WAS THE INVESTMENT ENVIRONMENT LIKE OVER THE PAST YEAR?
A. Just prior to the beginning of the period in March 1996, market
sentiment had shifted from a fear of recession to a fear that the economy
might be expanding too rapidly. Accordingly, investors began expecting the
Federal Reserve Board to increase the rate banks charge each other for
overnight loans - the fed funds target rate - to head off possible
inflation. As it turned out, the Fed held steady for over a year, keeping
the fed funds target rate at 5.25% since February of last year. While the
economy ended 1996 on a fairly strong note, economic data released in
January suggested that the economy was proceeding at a more moderate pace.
More importantly, inflation pressures didn't materialize, vindicating the
Fed's decision to leave policy unchanged. However, the Fed had expressed
concern about tightness in the labor market and the potential upward
pressure low unemployment might exert on the economy's core inflation.
Further, the Fed has indicated a bias toward raising interest rates to keep
inflation at bay. By February, the market had grown complacent with the
Fed's steady policy, but during the final days of the month, Fed Chairman
Alan Greenspan's semiannual testimony before Congress caused a shift in
market sentiment. Mentioning the possibility of raising rates before price
pressure flows through to the consumer - a pre-emptive tightening - his
comments reinforced the increased probability of a near-term increase in
the fed funds target rate, causing an increase in rates in the short end of
the taxable market.
Q. WHAT KIND OF STRATEGY DID YOU PURSUE WITH THE FUND OVER THE PAST SIX
MONTHS?
A. In anticipation of higher rates, my investment focus remained on the
short end of the yield curve. My purchases were concentrated in variable
rate instruments and three-month commercial paper. This conservative
strategy resulted in the fund's maturity declining considerably from the
mid 60-day range to 40 days at the end of the period. I have been able to
take advantage of technicals - supply and demand trends - unique to the
municipal short-term market. In periods of little demand, municipal money
market rates rise relative to taxable securities with comparable
maturities. I have tried to anticipate these periods to position the fund
to buy at higher yields. The fund has selectively purchased attractive
longer-term securities during these times. In addition, although the fed
funds target rate has held steady, short-term rates have been volatile.
Yields have risen as the market has digested strong economic data and
fallen as indicators reflect mild inflation. This volatility has provided
trading opportunities for the fund.
Q. HOW DID THE FUND PERFORM?
A. The fund's seven-day yield on February 28, 1997, was 3.09%, compared to
3.05% 12 months ago. The latest yield was the equivalent of a 5.32% taxable
rate of return for California investors in the 41.95% combined state and
federal income tax bracket. Through February 28, 1997, the fund's 12-month
total return was 3.18%, compared to 2.87% for the California tax-free money
market funds average, according to IBC Financial Data, Inc.
Q. WHAT'S YOUR OUTLOOK?
A. There is a risk that the economy's moderate strength may become more
robust, causing inflation pressures to build and possibly leading to an
upward trend in interest rates. Furthermore, seasonal outflows caused by
individual tax payments on April 15 are expected to cause yields to rise on
short-term municipal money market instruments. That being said, the fund's
average maturity should trend downward since there is virtually no new
issuance scheduled over the next few months. I'll continue to look for
trading opportunities, but intend to try to keep the fund's average
maturity
close to 40 days, which will enable me to extend the fund's average
maturity if rates do increase.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO MANAGER
ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON THE COVER.
THE MANAGER'S VIEWS ARE SUBJECT TO CHANGE AT ANY TIME BASED ON MARKET AND
OTHER CONDITIONS.
FUND FACTS
GOAL: high current tax-free
income for California residents
while maintaining a stable
$1.00 share price
FUND NUMBER: 457
TRADING SYMBOL: FSPXX
START DATE: November 27, 1989
SIZE: as of February 28,
1997, more than $1.3 billion
MANAGER: Diane McLaughlin,
since August 1996; manager,
various Fidelity and Spartan
municipal money market
funds; joined Fidelity in 1992
(checkmark)
SPARTAN CALIFORNIA MUNICIPAL MONEY MARKET FUND
INVESTMENT CHANGES
MATURITY DIVERSIFICATION
DAYS % OF FUND ASSETS % OF FUND ASSETS % OF FUND ASSETS
2/28/97 8/31/96 2/29/96
0 - 30 71 72 69
31 - 90 5 10 7
91 - 180 21 2 17
181 - 397 3 16 7
WEIGHTED AVERAGE MATURITY
2/28/97 8/31/96 2/29/96
Spartan California Municipal 40 days 63 days 49 days
Money Market
California Tax-free 40 days 52 days 42 days
Money Market Funds
Average *
ASSET ALLOCATION (% OF FUND'S INVESTMENTS)
AS OF FEBRUARY 28, 1997 AS OF AUGUST 31, 1996
Row: 1, Col: 1, Value: 63.0
Row: 1, Col: 2, Value: 12.0
Row: 1, Col: 3, Value: 2.0
Row: 1, Col: 4, Value: 23.0
Row: 1, Col: 5, Value: 0.0
Row: 1, Col: 1, Value: 69.0
Row: 1, Col: 2, Value: 9.0
Row: 1, Col: 3, Value: 3.0
Row: 1, Col: 4, Value: 17.0
Row: 1, Col: 5, Value: 2.0
Variable rate
demand notes
(VRDNs) 64%
Commercial
paper 12%
Tender bonds 1%
Municipal
notes 23%
Other 0%
Variable rate
demand notes
(VRDNs) 70%
Commercial
paper 9%
Tender bonds 2%
Municipal
notes 18%
Other 1%
* SOURCE: IBC'S MONEY FUND REPORT (registered trademark)
SPARTAN CALIFORNIA MUNICIPAL MONEY MARKET FUND
INVESTMENTS FEBRUARY, 1997
Showing Percentage of Total Value of Investments in Securities
<TABLE>
<CAPTION>
<S> <C> <C>
MUNICIPAL SECURITIES (A) - 100%
PRINCIPAL VALUE
AMOUNT (NOTE 1)
CALIFORNIA - 100.0%
Alameda County Ind. Dev. Auth. Ind. Rev.
(Edward L. Shimmon, Inc. Proj.) Series 1996 A,
3.30%, LOC Banque Nationale De Paris, VRDN (b) $ 3,600,000 $ 3,600,000
Alameda County TRAN 4.50% 6/30/97 3,800,000 3,806,663
Anaheim Hsg. Auth. Multi-Family Hsg. Rev., VRDN
(b):
(Bel Age Apts. Proj.) 3.30% (FNMA Guaranteed) 5,100,000 5,100,000
(Parka Vista Apts) Series 1993 A, 3.30%,
LOC Citibank, N.A. 9,800,000 9,800,000
(Sage Park Proj.) Series A, 3.30%,
LOC Bank of America NT & SA 3,900,000 3,900,000
Azusa Multi-Family Hsg. Rev. (Pacific Glen Apt.
Proj.) Series 1994, 3.50% (Continental Casualty
Co.) VRDN 3,300,000 3,300,000
Barstow Multi-Family Hsg. Rev. (Rimrock Village
Apt. Proj.) Series 1996, 3.30%, LOC Federal Home
Loan Bank, VRDN (b) 3,000,000 3,000,000
Berkeley TRAN 4.50% 8/13/97 5,200,000 5,213,554
Butte County Office of Ed. TRAN 4.50% 8/20/97 8,100,000 8,120,916
California Dept. of Wtr. Resources Participating
VRDN (c):
Series PA-131, 3.25%
(Liquidity Facility Merrill Lynch & Co., Inc.) 2,000,000 2,000,000
Series PA-133, 3.25%
(Liquidity Facility Merrill Lynch & Co., Inc.) 1,000,000 1,000,000
California Econ. Dev. Fin. Auth. Ind. Dev. Rev.
(Volk Enterprises)
Series 1996, 3.20%, LOC Harris Trust & Savings,
Chicago, VRDN 3,500,000 3,500,000
California Econ. Dev. Fing. Auth. Rev.
(Joseph Schmidt Proj.) Series A, 3.30%,
LOC Banque Nationale de Paris, VRDN (b) 2,000,000 2,000,000
California Gen. Oblig.:
CP:
3.35% 3/10/97 5,700,000 5,700,000
3.45% 3/11/97 5,000,000 5,000,000
3.40% 3/12/97 6,200,000 6,200,000
3.40% 4/9/97 10,900,000 10,900,000
3.45% 4/10/97 6,600,000 6,600,000
Participating VRDN (c):
Series 1996 L, 3.40% (FGIC Insured)
(Liquidity Facility Caisse des Depots et
Consignations) 16,210,000 16,210,000
Series PA-130, 3.35%
(Liquidity Facility Merrill Lynch & Co., Inc.) 1,000,000 1,000,000
Series SG-84, 3.35%
(Liquidity Facility Society Generale, France) 3,900,000 3,900,000
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
CALIFORNIA - CONTINUED
California Gen. Oblig.: - continued
Participating VRDN (c): - continued
Series SG-85, 3.35%
(Liquidity Facility Society Generale, France) $ 6,800,000 $ 6,800,000
RAN:
Series 1996-97, 4.50% 6/30/97 48,635,000 48,742,766
Series B, 3.504% 6/30/97 15,000,000 15,000,000
California Hsg. Fin. Agcy. Mtg. Rev. Bonds
Series 1996-J, 4%, tender 7/24/97 (FGIC Insured) 2,000,000 2,000,000
California Hsg. Fin. Agcy. Participating VRDN (c):
Series 1994 H, 3.45% (AMBAC Insured) (Liquidity
Facility Citibank, N.A.) (b) 6,900,000 6,900,000
Series 1994-1, 3.45%
(Liquidity Facility State Street Bank & Trust
Co., Boston) (b) 13,888,521 13,888,521
Series 1996 C-1, 3.40% (Liquidity Facility Bank
of America NT & SA) (b) 1,925,000 1,925,000
Series 1996 C-2, 3.40%
(Liquidity Facility Bank of America NT & SA) (b) 4,075,000 4,075,000
Series PA-90, 3.45%
(Liquidity Facility Merrill Lynch & Co.,
Inc.)(b) 5,890,000 5,890,000
Series PT-14, 3.25%
(Liquidity Facility Commerzbank, Germany) 9,220,000 9,220,000
Series PT-40A, 3.45%
(Liquidity Facility Commerzbank, Germany) (b) 1,300,000 1,300,000
Series PT-40B, 3.45%
(Liquidity Facility Bayerische Hypotheken-und
Weschel) (b) 14,150,000 14,150,000
Series PT-40C, 3.25%
(Liquidity Facility Banque Nationale de Paris) 3,370,000 3,370,000
Series PT-40D, 3.45%
(Liquidity Facility Banque Nationale de
Paris) (b) 12,280,000 12,280,000
Series PT-56, 3.45%
(Liquidity Facility Credit Suisse First
Boston) (b) 1,580,000 1,580,000
Series PT-68, 3.45%
(Liquidity Facility Credit Suisse First
Boston) (b) 3,980,000 3,980,000
Series 96C0502, 3.35%
(AMBAC Insured) (Liquidity Facility Citibank,
N.A.) 7,500,000 7,500,000
California Poll. Cont. Fing. Auth. Resource
Recovery Rev., VRDN (b):
(Burney Forest Prod. Proj.) 3.35%,
LOC Fleet Nat'l. Bank 1,200,000 1,200,000
(Delano Proj.) Series 1990, 3.45%, LOC
Algemene Bank 2,500,000 2,500,000
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
CALIFORNIA - CONTINUED
California Poll. Cont. Fing. Auth. Resource
Recovery Rev.,
VRDN (b): - continued
(Pacific Gas & Elec. Co.):
Series 1996 A, 3.30%, LOC Swiss Bank Corp. $ 38,100,000 $ 38,100,000
Series 1996 C, 3.40%, LOC Bank of America
NT & SA 9,200,000 9,200,000
Series 1996 F, 3.35%, LOC Banque Nationale
de Paris 1,200,000 1,200,000
Series 1996 G, 3.45% 5,800,000 5,800,000
(Southern California Edison Proj.):
Series 1986 A, 3.45% 600,000 600,000
Series 1986 C, 3.45% 700,000 700,000
Series 1986 D, 3.45% 3,900,000 3,900,000
California Poll. Cont. Fin. Auth. Rev.:
Bonds:
(Chevron USA, Inc. Proj.) Series 1983,
3.90%, tender 11/15/97 1,400,000 1,401,927
(Pacific Gas & Elec. Co.):
Series 1996 E, 3.40%, tender 3/20/97,
LOC Morgan Guaranty Trust, NY 5,400,000 5,400,000
Series 1996 D, 3.40%, tender 3/25/97,
LOC Union Bank of Switzerland 2,000,000 2,000,000
Series 1996 E:
3.55%, tender 3/7/97,
LOC Morgan Guaranty Trust, NY 4,400,000 4,400,000
3.45%, tender 3/10/97,
LOC Morgan Guaranty Trust, NY 3,200,000 3,200,000
3.40%, tender 3/17/97,
LOC Morgan Guaranty Trust, NY 4,500,000 4,500,000
3.45%, tender 4/8/97,
LOC Morgan Guaranty Trust, NY 2,200,000 2,200,000
3.40%, tender 4/11/97,
LOC Morgan Guaranty Trust, NY 2,000,000 2,000,000
California Poll. Cont. Fin. Auth. Solid Waste
Disp. Rev., VRDN (b):
(Athens Disp. Co. Proj.) Series 1995, 3.35%,
LOC Wells Fargo Bank of San Francisco 7,945,000 7,945,000
(EDCO Disposal) Series 1996 A, 3.35%,
LOC Wells Fargo Bank, N.A. 7,500,000 7,500,000
(Sanifill Inc. Proj.) Series 1995 A, 3.30%,
LOC California State Teachers Retirement Sys. 1,500,000 1,500,000
(Shell Oil Co. Martinez Proj.):
Series 1994 A, 3.40% 7,200,000 7,200,000
Series 1994 B, 3.40% 700,000 700,000
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
CALIFORNIA - CONTINUED
California Poll. Cont. Fin. Auth. Solid Waste
Disp. Rev., VRDN (b): - continued
(Taormina Ind. Inc. Proj.) Series 1996 A, 3.50%,
LOC Sanwa Bank Ltd. $ 3,100,000 $ 3,100,000
California School Cash Reserves Prog. TRAN
Series 1996 A, 4.75% 7/2/97 22,400,000 22,469,121
California Statewide Commty. Dev. Auth. Rev.,
VRDN:
Rfdg. (Irvine Apt. L.P.) Series 1995 A-7,
3.30% (FNMA Guaranteed) (b) 3,000,000 3,000,000
(American River Packaging) 3.30%,
LOC California State Teachers Retirement Sys.(b) 1,765,000 1,765,000
(Bro-Co Gen. Prtn. Proj.) Series 1990,
3.30%, LOC California State Teacher Retirement
Sys. (b) 3,880,000 3,880,000
(Covenant Retirement Commty., Inc.) :
3.25%, LOC LaSalle Nat'l. Bank 7,900,000 7,900,000
Series 1995, 3.25%, LOC LaSalle Nat'l. Bank 4,000,000 4,000,000
(Datatape, Inc. Proj.) Series 1996 D, 3.40%,
LOC Corestates Bank, N.A. (b) 1,700,000 1,700,000
(Duke Inc. Project) Series 1996 E, 3.40%,
LOC Wells Fargo Bank, N.A. (b) 1,500,000 1,500,000
(Fibrebond West, Inc. Proj.) Series 1996 N,
3.30%, LOC California State Teachers Retirement
Sys. (b) 4,000,000 4,000,000
(JDI Partners Proj.) 3.30%, LOC California State
Teachers Retirement Sys. (b) 1,800,000 1,800,000
(Jaygee Realty Co.) Series 1992, 3.40%,
LOC Bank of Tokyo-Mitsubishi, Ltd. 340,000 340,000
(K.U.M. Ltd. Proj.) Series 1992, 3.40%,
LOC Bank of Tokyo-Mitsubishi, Ltd. (b) 2,250,000 2,250,000
(Kennerly-Spratling Proj.) Series 1995 A, 3.30%,
LOC California State Teachers Retirement Sys.(b) 3,315,000 3,315,000
(Lance Camper Manufacturer) 3.30%,
LOC California State Teachers Retirement Sys.(b) 3,835,000 3,835,000
(Michigan Hanger Ind. Proj.) Series 1992, 3.40%,
LOC Bank of Tokyo-Mitsubishi, Ltd. (b) 640,000 640,000
(Propak-Ca. Corp. Proj.) Series 1994 B, 3.30%,
LOC California State Teachers Retirement Sys.(b) 2,410,000 2,410,000
(Rapelli of California Proj.) Series 1989, 3.30%,
LOC California State Teachers Retirement Sys.(b) 2,500,000 2,500,000
(Ring Can Proj.) Series 1992, 3.40%,
LOC Bank of Tokyo-Mitsubishi, Ltd. (b) 150,000 150,000
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
CALIFORNIA - CONTINUED
California Statewide Commty. Dev. Auth. Rev.,
VRDN: - continued
(Rix Ind. Proj.) Series 1996 I, 3.40%,
LOC Wells Fargo Bank, N.A. (b) $ 2,000,000 $ 2,000,000
(Santa Cruz-Wilson Entities Ltd. Proj.) Series
1993, 3.30%,
LOC Bank of Tokyo-Mitsubishi, Ltd. (b) 1,500,000 1,500,000
(Sunclipse, Inc.) (Alhambra Proj.) Series
1989, 3.30%,
LOC California State Teachers Retirement Sys.(b) 3,200,000 3,200,000
(Sys. Engineering & Mgmt. Co.) 3.30%,
LOC California State Teachers Retirement Sys.(b) 1,800,000 1,800,000
California Statewide Commty. Multi-Family Hsg. Dev.
Auth. (Canyon Creek Apts.) Series 1995 C, 3.25%
(FNMA Guaranteed) VRDN (b) 1,300,000 1,300,000
Camarillo Multi-Family Hsg. Auth. Rev., VRDN (b):
(Hacienda de Camarillo Proj.) Series 1996, 3.25%
(FNMA Guaranteed) 10,520,000 10,520,000
(Heritage Park Apts.) Series 1989 A, 3.30%
(FNMA Guaranteed) 7,200,000 7,200,000
Chula Vista Ind. Dev. Rev. (b):
(San Diego Gas & Elec. Co.):
Bonds:
Series C:
3.40%, tender 4/9/97 5,000,000 5,000,000
3.50%, tender 6/16/97 3,000,000 3,000,000
Series D:
3.55%, tender 3/7/97 2,500,000 2,500,000
3.50%, tender 3/10/97 4,000,000 4,000,000
Series E, 3.55%, tender 3/11/97 2,500,000 2,500,000
Series B, 3.35%, VRDN 9,800,000 9,800,000
Concord Multi-Family Hsg. Rev. (Hill Apt. Proj.)
3.30%, LOC Citibank N.A., VRDN (b) 8,400,000 8,400,000
Contra Costa County Wtr. Dist. Participating
VRDN, Series SG-24, 3.20%
(Liquidity Facility Societe Generale, France) (c) 4,425,000 4,425,000
Covina Redev. Agcy. Multi-Family Hsg. Rev.
(Shadowhills Apt. Proj.) Series 1994 A, 3.50%
(Continental Casualty Co. Guaranteed) VRDN 500,000 500,000
East Bay Muni. Util. Dist. Sys. Rev. Series 1988,
3.30% 4/11/97 (Liquidity Facility Westdeutsche
Landesbank) CP 2,900,000 2,900,000
Emeryville Redev. Agcy. Multi-Family Hsg.
(Emerybay Apts. II)
3.30%, LOC Bank of America NT & SA, VRDN (b) 14,000,000 14,000,000
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
CALIFORNIA - CONTINUED
Escondido Commty. Dev. Commission Rev.
(Escondido Promenade Proj.) 3.30%,
LOC Bank of America NT & SA, VRDN (b) $ 1,000,000 $ 1,000,000
Fairfield Ind. Dev. Auth., 3.35%,
LOC Wells Fargo Bank, N.A., VRDN (b) 1,800,000 1,800,000
Fremont Multi-Family Hsg. Rev. (Treetops Apts.)
Series 1996 A, 3.25% (FNMA Guaranteed) VRDN (b) 6,000,000 6,000,000
Fremont TRAN Series 1996, 4.50% 7/1/97 6,500,000 6,511,481
Fremont Unified School Dist. TRAN Series 1996,
4.625% 7/1/97 6,100,000 6,113,404
Fresno County TRAN 4.75% 9/29/97 6,700,000 6,742,015
Fresno TRAN 4.50% 6/30/97 2,600,000 2,604,975
Garden Grove Hsg. Auth. Multi-Family Hsg. Rev.
(Valley View Sr. Villas Proj.) Series 1990 A,
3.35%, LOC Wells Fargo Bank, N.A., VRDN (b) 6,200,000 6,200,000
Huntington Park Multi-Family Rev. (Casa Rita
Apts.) Series 1994 A, 3.30%,
LOC Wells Fargo Bank, N.A., VRDN (b) 5,700,000 5,700,000
Kern County TRAN 4.50% 10/2/97 12,900,000 12,957,103
Lassen Muni. Util. Dist. Rev. Rfdg. Series 1996
A, 3.40% (FSA Insured) (Liquidity Facility
Credit Local De France) VRDN (b) 6,510,000 6,510,000
Laverne Ind. Dev. Auth. Rev. (Paper-Pak Products
Inc. Proj.) 3.40%, LOC First Union Nat'l. Bank
of North Carolina, VRDN (b) 6,515,000 6,515,000
Livermore Ctfs. of Prtn. (Reverse Osmosis Proj.)
3.25%, LOC Nat'l. Westminster Bank PLC, VRDN 300,000 300,000
Livermore Multi-Family Mtg. Rev. (Portola Meadows
Apts.) Series 1989 A, 3.30%, LOC Bank of
America NT & SA, VRDN (b) 10,400,000 10,400,000
Long Beach Harbor Rev., Series A, CP (b):
3.30% 3/11/97 2,000,000 2,000,000
3.45% 3/11/97 4,800,000 4,800,000
Long Beach Participating VRDN, Series SG-73,
3.35% (Liquidity Facility Societe Generale,
France) (b)(c) 5,880,000 5,880,000
Los Angeles Commty. College Dist. TRAN Series
1996-97, 4.50% 7/1/97 2,200,000 2,203,530
Los Angeles Commty. Redev. Agcy. Multi-Family
Hsg. Rev. (Academy Village Apts. Proj.) Series
1989 A, 3.30%, LOC Swiss Bank Corp., VRDN (b) 5,000,000 5,000,000
Los Angeles Convention & Exhibit Ctr. Auth.
Participating VRDN, Series PA-1006, 3.25%
(MBIA Insured) (Liquidity Facility Merrill Lynch
& Co., Inc.) (c) 9,420,000 9,420,000
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
CALIFORNIA - CONTINUED
Los Angeles County Hsg. Auth. Multi-Family Hsg.
Rev. (Park Sierra Apt. Proj.) 3.30%,
LOC Citibank, N.A., VRDN (b) $ 39,200,000 $ 39,200,000
Los Angeles County Ind. Dev. Auth. (Caitac & Jae
Proj.), 3.40%, LOC Bank of Tokyo-Mitsubishi,
Ltd., VRDN (b) 2,670,000 2,670,000
Los Angeles County Multi-Family Hsg. Rev., VRDN:
(Malibu Meadows Proj.) Series 1991 A, 3.35%,
LOC Sumitomo Bank Ltd. 12,700,000 12,700,000
(Malibu Meadows II Proj.) Series 1991 B, 3.35%,
LOC Sumitomo Bank Ltd. 3,200,000 3,200,000
(Meadowridge Apt. Proj.) Series 1994 B, 3.50%
(Continental Casualty Co. Guaranteed) 4,000,000 4,000,000
Los Angeles County Metropolitan Trans. Auth.
Participating VRDN (c):
Series SG-2, 3.30%
(Liquidity Facility Societe Generale, France) 10,200,000 10,200,000
Series SG-3, 3.30%
(Liquidity Facility Societe Generale, France) 10,070,000 10,070,000
Series SG-54, 3.25% (AMBAC Insured)
(Liquidity Facility Societe Generale, France) 1,525,000 1,525,000
Series SG-55, 3.25% (MBIA Insured)
(Liquidity Facility Societe Generale, France) 10,000,000 10,000,000
Los Angeles County TRAN Series 1996-97, 4.50%
6/30/97 28,690,000 28,755,157
Los Angeles Dept. of Wtr. & Pwr. Elec. Plant
Short Term Rev., CP:
3 50% 3/13/97 11,200,000 11,200,000
3.45% 3/27/97 4,500,000 4,500,000
3.40% 5/8/97 1,400,000 1,400,000
3.40% 6/12/97 4,500,000 4,500,000
Los Angeles Harbor Dept. Participating
VRDN (b) (c):
Series SG-59, 3.35% (MBIA Insured)
(Liquidity Facility Societe Generale, France) 8,950,000 8,950,000
Series 1996 B, 3.45% (BPA Bank of New York, NY) 19,800,000 19,800,000
Los Angeles Multi-Family Hsg. Rev. (Beverly Park
Apts.) Series 1988 A, 3.25%, LOC Chase Manhattan
Bank, VRDN (b) 3,000,000 3,000,000
Los Angeles Ontario Int'l. Arpt. Participating
VRDN, Series SG-61, 3.35%
(Liquidity Facility Societe Generale, France)(c) 2,600,000 2,600,000
Los Angeles TRAN Series 1996, 4.50% 6/19/97 32,000,000 32,054,643
Los Angeles Unified School Dist. TRAN:
Series 1996-97 A, 4.50% 6/30/97 8,900,000 8,918,622
Series 1996-97 B, 4.50% 9/30/97 3,500,000 3,516,934
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
CALIFORNIA - CONTINUED
Los Angeles Wastewtr. Participating VRDN,
Series SG-26, 3.20%
(Liquidity Facility Societe Generale, France) (c) $ 15,970,000 $ 15,970,000
Los Angeles Wastewtr. Sys. Rev., CP:
3.45% 3/26/97, LOC Union Bank of Switzerland/
Morgan Guaranty Trust, NY 5,000,000 5,000,000
3.40% 4/8/97, LOC Union Bank of Switzerland/
Morgan Guaranty Trust, NY 6,400,000 6,400,000
Los Angeles Wtr. Elec. Pwr. Plant Participating
VRDN (c):
Series PA-121, 3.25%
(Liquidity Facility Merrill Lynch & Co., Inc.) 2,000,000 2,000,000
Series PA-141, 3.25%
(Liquidity Facility Merrill Lynch & Co., Inc.) 1,000,000 1,000,000
Monterey Ind. Dev. Auth. Rev. (Slautterback Corp.
Proj.) Series 1996 A, 3.30%, LOC Bayerische
Vereinsbank, VRDN (b) 2,000,000 2,000,000
Moreno Valley Unified School Dist. TRAN 4.50%
6/30/97 4,000,000 4,006,369
Newark Ind. Dev. Auth. Rev. (Gas Tech Proj.)
Series 1989 A, 3.30%, LOC Union Bank of
Switzerland, VRDN (b) 3,000,000 3,000,000
North County Schools Fing. Auth. TRAN 4.75%
7/1/97 2,700,000 2,705,194
Oakland TRAN Series 1996, 4.75% 6/30/97 3,800,000 3,810,548
Oakland Unified School Dist. TRAN (Alameda County)
Series 1996-97, 4.25% 10/14/97 4,600,000 4,614,350
Oceanside Multi-Family Rev. (Lakeridge Apt. Proj.)
Series 1994, 3.50% (Continental Casualty Co.
Guaranteed) VRDN 6,000,000 6,000,000
Ontario Ind. Dev. Auth. Rev. (Safari Land Proj.)
Series 1989, 3.30%, LOC Bank of America, VRDN (b) 3,400,000 3,400,000
Orange County Apt. Dev. Rev. Participating
VRDN (c):
Series JT 1996 A, 3.45%, LOC Citibank, N.A. (b) 10,900,000 10,900,000
Series JT 1996 B, 3.35%, LOC Citibank, N.A. 12,700,000 12,700,000
Orange County Apt. Dev. Rev., VRDN:
Rfdg. (Harbor Pointe Apts.) Series 1992 D, 3.25%,
LOC Citibank, N.A. 2,600,000 2,600,000
Rfdg. (Trabuco Woods Apts.) Series 1993 B, 3.30%,
LOC Wells Fargo Bank, N.A. 2,670,000 2,670,000
(Alicia Viego Proj.) Series 1986 A, 3.45%,
LOC Bank of Tokyo-Mitsubishi, Ltd. (b) 3,460,000 3,460,000
(Foothill Oaks Apts. Proj.) Series 1989 B,
3.50%, LOC Bank of America NT & SA (b) 12,400,000 12,400,000
(Frost Contruction Proj.) Series 1985 B, 3.30%,
LOC Wells Fargo Bank, N.A. 2,000,000 2,000,000
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
CALIFORNIA - CONTINUED
Orange County Apt. Dev. Rev., VRDN: - continued
(Hidden Hills) Series 1985 U-C, 3.30%,
LOC Chase Manhattan Bank $ 13,700,000 $ 13,700,000
(Monarch Bay Apt. Proj.) Series 1985 T, 3.30%,
LOC Bank of Tokyo-Mitsubishi, Ltd. 3,800,000 3,800,000
(Niguel Summit I) Series 1985 A, 3.30%,
LOC Chase Manhattan Bank 8,000,000 8,000,000
(Niguel Summit II) Series 1985 U-B, 3.45%,
LOC Bank of America NT & SA 2,200,000 2,200,000
(Vista Verde Apt. Proj.) Series 1988 A, 3.25%,
LOC Wells Fargo Bank, N.A. (b) 12,050,000 12,050,000
(Wood Canyon Villas) Series 1991 B, 3.25%,
LOC Bank of America NT & SA (b) 13,300,000 13,300,000
(Yorba Linda Assoc.) Series 1985 D, 3.40%,
LOC Bank of Tokyo-Mitsubishi, Ltd. 1,700,000 1,700,000
Orange County Ctfs. of Prtn. Series 1990-92 C,
3.40% (FGIC Insured) VRDN 300,000 300,000
Orange County Hsg. Auth. Apt. Dev. Rev., VRDN:
(Costa Mesa Partners) Series 1985-BB, 3.30%,
LOC Chase Manhattan Bank 5,000,000 5,000,000
(Lantern Pines Proj.-Frost Group) 3.30%,
LOC Bank of Tokyo-Mitsubishi, Ltd. 4,400,000 4,400,000
Paramount Unified School Dist. TRAN Series 1996,
4.50% 6/30/97 6,400,000 6,410,191
Pleasant Hill Redev. Agcy. Multi-Family Hsg. Rev.
(Chateau III Proj.) Series 1996 A, 3.40%,
LOC Commerzbank, Germany, VRDN (b) 1,460,000 1,460,000
Rancho Muni. Wtr. Dist. Fin. Auth. Rfdg.
Participating VRDN, 3.25%
(Liquidity Facility Societe Generale, France) (c) 8,750,000 8,750,000
Riverside County Hsg. Auth. Multi-Family Hsg. Mtg.
Rev. (Mt. View Apts.) Series 1995, 3.30%,
LOC Federal Home Loan Bank of San Francisco, VRDN 1,550,000 1,550,000
Riverside County Hsg. Auth. Multi-Family Hsg.
Rev., VRDN:
(Polk Apt. Proj.) Series 1985 O, 3.40%
(Household Finance Corp. Guaranteed) 3,690,000 3,690,000
(Tyler Village Proj.) Series 1986 A, 3.35%,
LOC Chase Manhattan Bank 3,900,000 3,900,000
Riverside County School Dist. TRAN Series 1996-76,
4.625% 7/17/97 1,300,000 1,302,712
Riverside County TRAN 4.50% 6/30/97 10,050,000 10,075,050
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
CALIFORNIA - CONTINUED
Sacramento County Arpt. Sys. Rev. Participating
VRDN (c):
Series SG-8, 3.30%,
(Liquidity Facility Societe Generale, France) $ 8,685,000 $ 8,685,000
Series SG-33, 3.20%
(Liquidity Facility Societe Generale, France) 5,810,000 5,810,000
Sacramento Muni. Util. Dist. Rev., Series I, CP:
3.40% 3/25/97, LOC Bayerische Landesbank
Girozentrale 5,100,000 5,100,000
3.50% 5/15/97, LOC Bayerische Landesbank
Girozentrale 3,100,000 3,100,000
San Bernardino County Hsg. (Alta Park Apts.)
3.50%, LOC Sumitomo Bank, Ltd., VRDN 3,100,000 3,100,000
San Bernardino County Ind. Dev. Auth. Rev.,
VRDN (b):
(McClain Citrus Inc. Proj.) 3.30%,
LOC California State Teachers Retirement Sys. 2,800,000 2,800,000
(W & H Voortman, Inc. Proj.) 3.30%,
LOC California State Teachers Retirement Sys. 2,280,000 2,280,000
San Bernardino County TRAN 4.50% 6/30/97,
LOC Landesbank Hessen-Thuringen/Toronto Dominion
Bank 6,300,000 6,318,208
San Diego County Reg'l. Trans. Sales Tax
Participating VRDN, Series BT-185, 3.20%
(Liquidity Facility Bankers Trust Company, NY)(c) 4,920,000 4,920,000
San Diego County Wtr. Auth. Series 1, 3.50%
5/6/97 (Liquidity Facility Bayerische Landesbank
Girozentrale) CP 2,000,000 2,000,000
San Diego Hsg. Auth. Multi-Family Hsg. Rev.,
VRDN:
Rfdg. (Coral Pointe Apt. Proj.) Series 1993
A, 3.50% 5,000,000 5,000,000
(Paseo Point Apt.) Series 1994 A, 3.35%,
LOC Bank of Tokyo-Mitsubishi, Ltd. 7,950,000 7,950,000
San Diego Ind. Dev. Participating VRDN, Series
1997, 3.35% (Liquidity Facility Bank of New
York, NY) (c) 12,000,000 12,000,000
San Diego Ind. Dev. Rev. Bonds:
(San Diego Gas & Elec.):
Series 1995 A, 3.40%, tender 5/13/97 4,100,000 4,100,000
Series 1995 B, 3.45%, tender 4/8/97 1,000,000 1,000,000
San Francisco City & County Parking Auth.
Participating VRDN, Series 1996 A, 3.25%
(Liquidity Facility Bank of America NT & SA) (c) 6,375,000 6,375,000
San Francisco City & County Participating VRDN
(c):
Series 1996 AA2, 3.35%
(Liquidity Facility Bank of America NT & SA) 1,740,000 1,740,000
Series 1996 AA3, 3.35% (FGIC Insured)
(Liquidity Facility Bank of America NT & SA) 4,210,000 4,210,000
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
CALIFORNIA - CONTINUED
San Francisco City & County Participating
VRDN (c): - continued
Series 1996 AA4, 3.35% (FGIC Insured)
(Liquidity Facility Bank of America NT & SA) $ 4,450,000 $ 4,450,000
San Jose Multi-Family Hsg. Rev.
(Siena at Renaissance Square) Series 1996 A,
3.30%, LOC Bank One Arizona, VRDN (b) 11,000,000 11,000,000
San Jose Multi-Family Mtg. Rev. (Somerset Park
Apts.) Series 1987 A, 3.30%, LOC Bank of America
NT & SA, VRDN (b) 3,100,000 3,100,000
San Luis Obispo County Office of Ed. TRAN
Series 1996, 4.50% 10/9/97 8,800,000 8,836,066
San Luis Obispo County TRAN Series 1996-97,
4.50% 7/8/97 4,000,000 4,008,151
Santa Barbara County TRAN Series A, 4.75% 10/1/97 1,750,000 1,760,814
Santa Clara County Multi-Family Hsg. Rev.
(Garden Grove Apts.) 3.15% (FNMA Guaranteed) VRDN 4,400,000 4,400,000
Santa Clara County TRAN Series 1996-97, 4.50%
8/1/97 10,000,000 10,022,140
Santa Clara Unified School Dist. TRAN Series
1996, 4.50% 7/2/97 1,400,000 1,402,720
Simi Valley Multi-Family Hsg. Rev., VRDN (b):
(Lincoln Wood Ranch Apt.) 3.35%,
LOC Sumitomo Bank Ltd. 3,800,000 3,800,000
(Shadowridge Apts.) Series 1989, 3.30%,
LOC Citibank, N.A. 20,200,000 20,200,000
South Coast Local Ed. TRAN Series 1996, 4.75%
6/30/97 13,900,000 13,944,920
Southern California Metropolitan Wtr. Dist.:
CP:
Series A, 3.30% 4/11/97 1,800,000 1,800,000
Series B:
3.45% 3/11/97
(Liquidity Facility Westdeutsche Landesbank) 1,000,000 1,000,000
3.45% 4/8/97
(Liquidity Facility Westdeutsche Landesbank) 1,000,000 1,000,000
3.40% 4/10/97
(Liquidity Facility Westdeutsche Landesbank) 2,500,000 2,500,000
3.40% 4/11/97
(Liquidity Facility Westdeutsche Landesbank) 1,000,000 1,000,000
3.50% 5/12/97
(Liquidity Facility Westdeutsche Landesbank) 2,000,000 2,000,000
Participating VRDN (c):
Series 32-A, 3.40%
(Liquidity Facility Morgan Guaranty Trust, NY) 2,350,000 2,350,000
Series 32-B, 3.40%
(Liquidity Facility Morgan Guaranty Trust, NY) 4,945,000 4,945,000
MUNICIPAL SECURITIES (A) - CONTINUED
PRINCIPAL VALUE
AMOUNT (NOTE 1)
CALIFORNIA - CONTINUED
Southern California Pub. Pwr. Auth.
Participating VRDN (c):
Series BT-90, 3.20%
(Liquidity Facility Bankers Trust Company, NY) $ 5,790,000 $ 5,790,000
Series SG-35, 3.25%
(Liquidity Facility Societe Generale, France) 11,765,000 11,765,000
Stanislaus County Office of Ed. TRAN Series 1996,
4.50% 6/30/97 3,300,000 3,305,255
Stanislaus County TRAN 4.50% 7/1/97 11,500,000 11,521,045
Torrance Hospital Rev. (Little Co. of Mary Hosp.
- - Torrance
Memorial Med. Ctr.) Series 1992, 3.25%,
LOC Chase Manhattan Bank, VRDN 4,300,000 4,300,000
University of California Rev. Series A, CP:
3.40% 4/10/97 6,500,000 6,500,000
3.30% 4/11/97 2,300,000 2,300,000
3.50% 5/9/97 2,000,000 2,000,000
3.40% 7/15/97 12,500,000 12,500,000
Vista City Ind. Dev. Auth. Rev. (Desalination
Sys., Inc.)
Series 1995, 3.35%, LOC Wells Fargo Bank, N.A.,
VRDN (b) 6,390,000 6,390,000
TOTAL INVESTMENTS - 100% $ 1,332,720,065
Total Cost for Income Tax Purposes $ 1,332,720,477
</TABLE>
SECURITY TYPE ABBREVIATIONS
CP - Commercial Paper
RAN - Revenue Anticipation Notes
TRAN - Tax and Revenue Anticipation Notes
VRDN - Variable Rate Demand Notes
LEGEND
(a) The coupon rate shown on floating or adjustable rate securities
represents the rate at period end.
(b) Private activity obligations whose interest is subject to the federal
alternative minimum tax for individuals.
(c) Provides evidence of ownership in one or more underlying municipal
bonds.
INCOME TAX INFORMATION
At February 28, 1997, the fund had a capital loss carryforward of
approximately $591,000 which will expire on February 28, 2003.
SPARTAN CALIFORNIA MUNICIPAL MONEY MARKET FUND
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
<S> <C> <C>
FEBRUARY 28, 1997
ASSETS
Investment in securities, at value - $ 1,332,720,065
See accompanying schedule
Cash 2,206,469
Interest receivable 12,904,149
TOTAL ASSETS 1,347,830,683
LIABILITIES
Payable for investments purchased $ 3,500,000
Distributions payable 99,234
Accrued management fee 360,348
Other payables and accrued expenses 12,920
TOTAL LIABILITIES 3,972,502
NET ASSETS $ 1,343,858,181
Net Assets consist of:
Paid in capital $ 1,344,445,808
Accumulated net realized gain (loss) on investments (587,627)
NET ASSETS, for 1,344,445,781 shares outstanding $ 1,343,858,181
NET ASSET VALUE, offering price and redemption price per $1.00
share ($1,343,858,181 (divided by) 1,344,445,781 shares)
</TABLE>
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
<S> <C> <C>
YEAR ENDED FEBRUARY 28, 1997
INTEREST INCOME $ 46,770,586
EXPENSES
Management fee $ 6,695,623
Non-interested trustees' compensation 22,077
Total expenses before reductions 6,717,700
Expense reductions (2,098,298) 4,619,402
NET INTEREST INCOME 42,151,184
NET REALIZED GAIN (LOSS) ON INVESTMENTS 9,484
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 42,160,668
</TABLE>
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
<S> <C> <C>
YEAR ENDED YEAR ENDED
FEBRUARY 28, FEBRUARY 29,
1997 1996
INCREASE (DECREASE) IN NET ASSETS
Operations $ 42,151,184 $ 44,628,135
Net interest income
Net realized gain (loss) 9,484 163,135
Increase (decrease) in net unrealized gain from - (375)
accretion
of discount
NET INCREASE (DECREASE) IN NET ASSETS RESULTING 42,160,668 44,790,895
FROM OPERATIONS
Distributions to shareholders from net interest income (42,151,184) (44,628,135)
Share transactions at net asset value of $1.00 per share 1,487,178,587 1,571,224,348
Proceeds from sales of shares
Reinvestment of distributions from net interest income 41,201,486 43,274,284
Cost of shares redeemed (1,491,837,435) (1,470,606,698)
NET INCREASE (DECREASE) IN NET ASSETS AND SHARES 36,542,638 143,891,934
RESULTING FROM SHARE TRANSACTIONS
TOTAL INCREASE (DECREASE) IN NET ASSETS 36,552,122 144,054,694
NET ASSETS
Beginning of period 1,307,306,059 1,163,251,365
End of period $ 1,343,858,181 $ 1,307,306,059
</TABLE>
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
YEAR ENDED YEAR ENDED YEAR ENDED FEBRUARY 28, TEN MONTHS
FEBRUARY 28, FEBRUARY 29, ENDED
FEBRUARY 28,
1997 1996 1995 1994 1993
SELECTED PER-SHARE DATA
Net asset value, beginning $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
of period
Income from Investment .031 .035 .030 .024 .022
Operations
Net interest income
Less Distributions
From net interest income (.031) (.035) (.030) (.024) (.022)
Net asset value, end of period $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
TOTAL RETURN B 3.18% 3.60% 3.00% 2.45% 2.24%
RATIOS AND SUPPLEMENTAL
DATA
Net assets, end of period $ 1,343,858 $ 1,307,306 $ 1,163,251 $ 1,064,603 $ 855,590
(000 omitted)
Ratio of expenses to average .35% C .31% C .28% .21% .30% A,
net assets C C C
Ratio of expenses to average .34% D .31% .28% .21% .30% A
net assets after expense
reductions
Ratio of net interest income to 3.14% 3.55% 2.96% 2.42% 2.67% A
average net assets
</TABLE>
C ANNUALIZED
C TOTAL RETURNS DO NOT INCLUDE THE ACCOUNT CLOSEOUT FEE AND FOR PERIODS OF
LESS THAN ONE YEAR ARE NOT ANNUALIZED. THE TOTAL RETURNS WOULD HAVE BEEN
LOWER HAD CERTAIN EXPENSES NOT BEEN REDUCED DURING THE PERIODS SHOWN (SEE
NOTE 5 OF NOTES TO FINANCIAL STATEMENTS).
C FMR AGREED TO REIMBURSE A PORTION OF THE FUND'S EXPENSES DURING THE
PERIOD. WITHOUT THIS REIMBURSEMENT, THE FUND'S EXPENSE RATIO WOULD HAVE
BEEN HIGHER (SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS).
C FMR OR THE FUND HAS ENTERED INTO VARYING ARRANGEMENTS WITH THIRD PARTIES
WHO EITHER PAID OR REDUCED A PORTION OF THE FUND'S EXPENSES (SEE NOTE 5 OF
NOTES TO FINANCIAL STATEMENTS).
NOTES TO FINANCIAL STATEMENTS
For the period ended February 28, 1997
7. SIGNIFICANT ACCOUNTING POLICIES.
Spartan California Municipal Income Fund (the income fund) and Spartan
California Intermediate Municipal Income Fund (the intermediate fund) are
funds of Fidelity California Municipal Trust. Spartan California Municipal
Money Market Fund (the money market fund) is a fund of Fidelity California
Municipal Trust II. Each trust is registered under the Investment Company
Act of 1940, as amended (the 1940 Act), as an open-end management
investment company. Fidelity California Municipal Trust and Fidelity
California Municipal Trust II (the trusts) are organized as a Massachusetts
business trust and a Delaware business trust, respectively. Each fund is
authorized to issue an unlimited number of shares. The financial statements
have been prepared in conformity with generally accepted accounting
principles which permit management to make certain estimates and
assumptions at the date of the financial statements. The following
summarizes the significant accounting policies of the income fund, the
intermediate fund and the money market fund:
SECURITY VALUATION.
INCOME AND INTERMEDIATE FUNDS. Securities are valued based upon a
computerized matrix system and/or appraisals by a pricing service, both of
which consider market transactions and dealer-supplied valuations.
Securities for which quotations are not readily available are valued at
their fair value as determined in good faith under consistently applied
procedures under the general supervision of the Board of Trustees.
Short-term securities with remaining maturities of sixty days or less for
which quotations are not readily available are valued at amortized cost or
original cost plus accrued interest, both of which approximate current
value.
MONEY MARKET FUND. As permitted under Rule 2a-7 of the 1940 Act, and
certain conditions therein, securities are valued initially at cost and
thereafter assume a constant amortization to maturity of any discount or
premium.
INCOME TAXES. As a qualified regulated investment company under Subchapter
M of the Internal Revenue Code, each fund is not subject to income taxes to
the extent that it distributes substantially all of its taxable income for
the fiscal year. The schedules of investments include information regarding
income taxes under the caption "Income Tax Information."
INTEREST INCOME. Interest income, which includes amortization of premium
and accretion of original issue discount, is accrued as earned. For the
money market fund, accretion of discount represents unrealized gain until
realized at the time of a security disposition or maturity.
EXPENSES. Most expenses of each trust can be directly attributed to a fund.
Expenses which cannot be directly attributed are apportioned between the
funds in the trust.
DISTRIBUTIONS TO SHAREHOLDERS. Dividends are declared daily and paid
monthly from net interest income. Distributions to shareholders from
realized capital gains on investments, if any, are recorded on the
ex-dividend date.
1. SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
DISTRIBUTIONS TO SHAREHOLDERS - CONTINUED
Income and capital gain distributions are determined in accordance with
income tax regulations which may differ from generally accepted accounting
principles. These differences, which may result in distribution
reclassifications, are primarily due to differing treatments for futures
transactions, market discount, losses deferred due to wash sales and
capital loss carryforwards.
Permanent book and tax basis differences relating to shareholder
distributions will result in reclassifications to paid in capital and may
affect the per-share allocation between net interest income and realized
and unrealized gain (loss). Any taxable gain remaining at fiscal year end
is distributed in the following year.
REDEMPTION FEES. Shares held in the income fund less than 180 days are
subject to a redemption fee equal to .50% of the proceeds of the redeemed
shares. The fee, which is retained by the fund, is accounted for as an
addition to paid in capital.
SECURITY TRANSACTIONS. Security transactions are accounted for as of trade
date. Gains and losses on securities sold are determined on the basis of
identified cost.
8. OPERATING POLICIES.
WHEN-ISSUED SECURITIES. Each fund may purchase or sell securities on a
when-issued basis. Payment and delivery may take place a month or more
after the date of the transaction. The price of the underlying securities
is fixed at the time the transaction is negotiated. The market values of
the securities purchased on a when-issued or forward commitment basis are
identified as such in each applicable fund's schedule of investments. Each
fund may receive compensation for interest forgone in the purchase of a
when-issued security. With respect to purchase commitments, each fund
identifies securities as segregated in its custodial records with a value
at least equal to the amount of the commitment. The payables and
receivables associated with the purchases and sales of when-issued
securities having the same settlement date and broker are offset.
When-issued securities that have been purchased from and sold to different
brokers are reflected as both payables and receivables in the applicable
statements of assets and liabilities under the caption "Delayed delivery."
Losses may arise due to changes in the market value of the underlying
securities, if the counterparty does not perform under the contract, or if
the issuer does not issue the securities due to political, economic, or
other factors.
FUTURES CONTRACTS. Certain funds may use futures contracts to manage their
exposure to the bond market and to fluctuations in interest rates. Buying
futures tends to increase a fund's exposure to the underlying instrument,
while selling futures tends to decrease a fund's exposure to the underlying
instrument or hedge other fund investments. Futures contracts involve, to
varying degrees, risk of loss in excess of the futures variation margin
reflected in each applicable fund's Statement of Assets and Liabilities.
2. OPERATING POLICIES - CONTINUED
FUTURES CONTRACTS - CONTINUED
The underlying face amount at value of any open futures contracts at period
end is shown in each applicable fund's schedule of investments under the
caption "Futures Contracts." This amount reflects each contract's exposure
to the underlying instrument at period end. Losses may arise from changes
in the value of the underlying instruments, if there is an illiquid
secondary market for the contracts, or if the counterparties do not perform
under the contracts' terms. Futures contracts are valued at the settlement
price established each day by the board of trade or exchange on which they
are traded.
9. PURCHASES AND SALES OF INVESTMENTS.
INCOME FUND. Purchases and sales of securities, other than short-term
securities, aggregated $88,001,522 and $106,163,017, respectively.
The market value of futures contracts opened and closed during the period
amounted to $83,322,806 and $63,989,826, respectively.
INTERMEDIATE FUND. Purchases and sales of securities, other than short-term
securities, aggregated $20,274,185 and $15,437,472, respectively.
The market value of futures contracts opened and closed during the period
amounted to $9,347,158 and $10,040,819, respectively.
10. FEES AND OTHER TRANSACTIONS WITH AFFILIATES.
MANAGEMENT FEE. As each fund's investment adviser, Fidelity Management &
Research Company (FMR) pays all expenses, except the compensation of the
non-interested Trustees and certain exceptions such as interest, taxes,
brokerage commissions and extraordinary expenses. FMR receives a fee that
is computed daily at an annual rate of .55%, .55% and .50% of average net
assets for the income, intermediate and money market funds, respectively.
FMR also bears the cost of providing shareholder services to each fund. To
offset the cost of providing these services, FMR or its affiliates
collected certain transaction fees from shareholders which amounted to
$2,646, $783 and $14,173 for the income, intermediate and money market
funds, respectively.
SUB-ADVISER FEE. As the money market fund's investment sub-adviser, FMR
Texas Inc., a wholly owned subsidiary of FMR, receives a fee from FMR of
50% of the management fee payable to FMR. The fees are paid prior to any
voluntary expense reimbursements which may be in effect.
11. EXPENSE REDUCTIONS.
FMR voluntarily agreed to reimburse the intermediate and money market
funds' operating expenses (excluding interest, taxes, brokerage commissions
and extraordinary expenses) above a specified percentage of average net
assets.
(I) INTERMEDIATE FUND. For the period, this expense limitation was .40% of
average net assets and the reimbursement reduced expenses by $9,071.
5. EXPENSE REDUCTIONS - CONTINUED
Effective April 1, 1996, the fund's expense limitation was eliminated.
(II) MONEY MARKET FUND. For the period, this expense limitation was .35% of
average net assets and the reimbursement reduced expenses by $2,015,309.
In addition, each fund has entered into arrangements with its custodian and
transfer agent whereby interest earned on uninvested cash balances was used
to offset a portion of each fund's expenses. During the period, the
custodian and transfer agent fees were reduced by $26,676 and $21,875,
$5,391 and $425, and $13,567 and $69,422, for the income, intermediate and
money market funds, respectively, under these arrangements.
12. PROPOSED REORGANIZATION.
The Boards of Trustees of the Spartan California Municipal Income Fund and
Spartan California Intermediate Municipal Income Fund have approved
Agreements and Plans of Reorganization ("Agreements") between each of these
funds and Fidelity California Municipal Income Fund ("Reorganizations").
The Agreements provide for the transfer of substantially all of the assets
of each of these funds to Fidelity California Municipal Income Fund in
exchange solely for the number of shares of Fidelity California Municipal
Income Fund having the same aggregate net asset value as the outstanding
shares of each of these funds at the close of business on the day that the
Reorganizations are effective. The Agreements also provide for the
assumption by Fidelity California Municipal Income Fund of substantially
all of the liabilities of each of these funds. A Reorganization can be
consummated only if, among other things, it is approved by the vote of a
majority (as defined by the Investment Company Act of 1940) of outstanding
voting securities of the fund to which the Reorganization relates. A
Special Meeting of Shareholders ("Meeting") of Spartan California Municipal
Income Fund and Spartan California Intermediate Municipal Income Fund will
be held on August 4, 1997 to vote on the Agreements. A detailed description
of the proposed transaction and voting information will be sent to
shareholders of each fund in June 1997. If the Agreements are approved at
the Meeting, the Reorganizations are expected to become effective in August
1997.
Effective February 28, 1997, shares of Spartan California Municipal Income
Fund and Spartan California Intermediate Municipal Fund are no longer
available for purchase or exchange to new accounts of these funds.
REPORT OF INDEPENDENT ACCOUNTANTS
To the Trustees of Fidelity California Municipal Trust and Fidelity
California Municipal Trust II and the Shareholders of Spartan California
Municipal Income Fund, Spartan California Intermediate Municipal Income
Fund, and Spartan California Municipal Money Market Fund:
In our opinion, the accompanying statements of assets and liabilities,
including the schedules of investments (except for Moody's and Standard and
Poor's ratings) and the related statements of operations and of changes in
net assets and the financial highlights present fairly, in all material
respects, the financial position of the Spartan California Municipal Income
Fund, Spartan California Intermediate Municipal Income Fund (funds of
Fidelity California Municipal Trust) and Spartan California Municipal Money
Market Fund (a fund of Fidelity California Municipal Trust II) at February
28, 1997, the results of each of their operations for the year then ended,
the changes in each of their net assets and the financial highlights for
the periods indicated, in conformity with generally accepted accounting
principles. These financial statements and financial highlights (hereafter
referred to as "financial statements") are the responsibility of each
fund's management; our responsibility is to express an opinion on these
financial statements based on our audits. We conducted our audits of these
financial statements in accordance with generally accepted auditing
standards which require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant
estimates made by management, and evaluating the overall financial
statement presentation. We believe that our audits, which included
confirmation of securities at February 28, 1997 by correspondence with the
custodian and brokers and the application of alternative auditing
procedures where confirmation from brokers were not received, provide a
reasonable basis for the opinion expressed above.
PRICE WATERHOUSE LLP
Boston, Massachusetts
April 3, 1997
DISTRIBUTIONS
DISTRIBUTIONS
During fiscal year ended February 28, 1997, 100% of each fund's income
dividends was free from federal income tax, and 6.36%, 5.14% and 41.13%,
respectively, of the income, intermediate and money market funds' income
dividends was subject to the federal alternative minimum tax.
MANAGING YOUR INVESTMENTS
Fidelity offers several ways to conveniently manage your personal
investments via your telephone or PC. You can access your account
information, conduct trades and research your investments 24 hours a day.
BY PHONE
Fidelity TouchTone Xpressprovides a single toll-free number to access
account balances, positions, quotes and trading. It's easy to navigate the
service, and on your first call, the system will help you create a personal
identification number (PIN) for security.
SM
(PHONE_GRAPHIC)TOUCHTONE XPRESS
1-800-544-5555
PRESS
For mutual fund and brokerage trading.
1
For quotes.*
2
For account balances and holdings.
3
To review orders and mutual
fund activity.
4
To change your PIN.
5
To speak to a Fidelity representative.
*
0
BY PC
Fidelity's Web site on the Internet provides a wide range of information,
including daily financial news, fund performance, interactive planning
tools and news about Fidelity products and services.
(PHONE_GRAPHIC)FIDELITY'S WEB SITE
WWW.FIDELITY.COM
If you are not currently on the Internet, call Fidelity at 1-800-544-7272
for significant savings on Web access from internetMCI.
SM
(PHONE_GRAPHIC)
FIDELITY ON-LINE XPRESS+
TM
Fidelity On-line Xpress+ software for Windows combines comprehensive
portfolio management capabilities, securities trading and access to
research and analysis tools . . . all on your desktop. Call Fidelity at
1-800-544-7272 or visit our Web site for more information on how to manage
your investments via your PC.
* WHEN YOU CALL THE QUOTES LINE, PLEASE REMEMBER THAT A FUND'S YIELD AND
RETURN WILL
VARY AND, EXCEPT FOR MONEY MARKET FUNDS, SHARE PRICE WILL ALSO VARY. THIS
MEANS THAT
YOU MAY HAVE A GAIN OR LOSS WHEN YOU SELL YOUR SHARES. THERE IS NO
ASSURANCE THAT
MONEY MARKET FUNDS WILL BE ABLE TO MAINTAIN A STABLE $1 SHARE PRICE; AN
INVESTMENT
IN A MONEY MARKET FUND IS NOT INSURED OR GUARANTEED BY THE U.S. GOVERNMENT.
TOTAL
RETURNS ARE HISTORICAL AND INCLUDE CHANGES IN SHARE PRICE, REINVESTMENT OF
DIVIDENDS
AND CAPITAL GAINS, AND THE EFFECTS OF ANY SALES CHARGES.
TO WRITE FIDELITY
If more than one address is listed, please locate the address that is
closest to you. We'll give your correspondence immediate attention and send
you written confirmation upon completion of your request.
(LETTER_GRAPHIC)MAKING CHANGES
TO YOUR ACCOUNT
(such as changing name, address, bank, etc.)
Fidelity Investments
P.O. Box 770001
Cincinnati, OH 45277-0002
(LETTER_GRAPHIC)FOR NON-RETIREMENT
ACCOUNTS
BUYING SHARES
Fidelity Investments
P.O. Box 770001
Cincinnati, OH 45277-0003
OVERNIGHT EXPRESS
Fidelity Investments
2300 Litton Lane - KH1A
Hebron, KY 41048
SELLING SHARES
Fidelity Investments
P.O. Box 660602
Dallas, TX 75266-0602
OVERNIGHT EXPRESS
Fidelity Investments
Attn: Redemptions - CP6I
400 East Las Colinas Blvd.
Irving, TX 75309-5517
GENERAL CORRESPONDENCE
Fidelity Investments
P.O. Box 193
Boston, MA 02210-0193
(LETTER_GRAPHIC)FOR RETIREMENT
ACCOUNTS
BUYING SHARES
Fidelity Investments
P.O. Box 770001
Cincinnati, OH 45277-0003
SELLING SHARES
Fidelity Investments
P.O. Box 660602
Dallas, TX 75266-0602
OVERNIGHT EXPRESS
Fidelity Investments
Attn: Redemptions - CP6R
400 East Las Colinas Blvd.
Irving, TX 75309-5517
GENERAL CORRESPONDENCE
Fidelity Investments
P.O. Box 660602
Dallas, TX 75266-0602
INVESTMENT ADVISER
(registered trademark)
Fidelity Management & Research
Company
Boston, MA
INVESTMENT SUB-ADVISER,
MONEY MARKET FUND
FMR Texas Inc.
Irving, TX
OFFICERS
Edward C. Johnson 3d, President
J. Gary Burkhead, Senior Vice President
Fred L. Henning, Jr., Vice President -
FIXED-INCOME FUNDS
Sarah H. Zenoble, Vice President -
MONEY MARKET FUND
Arthur S. Loring, Secretary
Kenneth A. Rathgeber, Treasurer
Thomas D. Maher, Assistant
Vice President
John H. Costello, Assistant Treasurer
Leonard M. Rush, Assistant Treasurer
Thomas J. Simpson, Assistant Treasurer
BOARD OF TRUSTEES
J. Gary Burkhead
Ralph F. Cox *
Phyllis Burke Davis *
Edward C. Johnson 3d
E. Bradley Jones *
Donald J. Kirk *
Peter S. Lynch
Marvin L. Mann *
William O. McCoy *
Gerald C. McDonough *
Thomas R. Williams *
* INDEPENDENT TRUSTEES
GENERAL DISTRIBUTOR
Fidelity Distributors Corporation
Boston, MA
TRANSFER AND SHAREHOLDER
SERVICING AGENTS
UMB Bank, n.a.
Kansas City, MO
and
Fidelity Service Company, Inc.
Boston, MA
CUSTODIAN
UMB Bank, n.a.
Kansas City, MO
THE FIDELITY TELEPHONE CONNECTION
MUTUAL FUND 24-HOUR SERVICE
Exchanges/Redemptions 1-800-544-7777
Account Assistance 1-800-544-6666
Product Information 1-800-544-8888
Retirement Accounts 1-800-544-4774 (8 a.m. - 9 p.m.)
TDD Service 1-800-544-0118
for the deaf and hearing impaired
(9 a.m. - 9 p.m. Eastern time)
TouchTone Xpress 1-800-544-5555
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