File No. 33-42431
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [X]
Pre-Effective Amendment No. [ ]
Post-Effective Amendment No. 5 [X]
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 [X]
Amendment No. 5 [X]
(Check appropriate box or boxes.)
DREYFUS NEW YORK MUNICIPAL CASH MANAGEMENT
(Exact Name of Registrant as Specified in Charter)
c/o The Dreyfus Corporation
200 Park Avenue, New York, New York 10166
(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, including Area Code: (212) 922-6000
Daniel C. Maclean III, Esq.
200 Park Avenue
New York, New York 10166
(Name and Address of Agent for Service)
It is proposed that this filing will become effective (check appropriate
box)
___ immediately upon filing pursuant to paragraph (b) of Rule 485
___ on pursuant to paragraph (b) of Rule 485
___ 60 days after filing pursuant to paragraph (a) of Rule 485
X on November 28, 1994 pursuant to paragraph (a) of Rule 485
Registrant has registered an indefinite number of shares of its
beneficial interest under the Securities Act of 1933 pursuant to
Section 24(f) of the Investment Company Act of 1940. Registrant's Rule
24f-2 Notice for the fiscal year ended July 31, 1994 was filed on
September 28, 1994.
DREYFUS NEW YORK MUNICIPAL CASH MANAGEMENT
Cross-Reference Sheet Pursuant to Rule 495(a)
Items in
Part A of
Form N-1A Caption Page
1 Cover Page Cover
2 Synopsis 2
3 Condensed Financial Information 3
4 General Description of Registrant 4
5 Management of the Fund 9
5(a) Management's Discussion of Fund's Performance *
6 Capital Stock and Other Securities 14
7 Purchase of Securities Being Offered 9
8 Redemption or Repurchase 11
9 Pending Legal Proceedings *
Items in
Part B of
Form N-1A
10 Cover Page Cover
11 Table of Contents Cover
12 General Information and History B-18
13 Investment Objectives and Policies B-2
14 Management of the Fund B-7
15 Control Persons and Principal B-10
Holders of Securities
16 Investment Advisory and Other B-11
Services
NOTE: * Omitted since answer is negative or inapplicable.
DREYFUS NEW YORK MUNICIPAL CASH MANAGEMENT
Cross-Reference Sheet Pursuant to Rule 495(a) (continued)
Items in
Part B of
Form N-1A Caption Page
17 Brokerage Allocation B-16
18 Capital Stock and Other Securities B-18
19 Purchase, Redemption and Pricing B-12,
of Securities Being Offered B-14, B-15
20 Tax Status *
21 Underwriters B-12
22 Calculations of Performance Data B-17
23 Financial Statements B-39
Items in
Part C of
Form N-1A
24 Financial Statements and Exhibits C-1
25 Persons Controlled by or Under C-3
Common Control with Registrant
26 Number of Holders of Securities C-3
27 Indemnification C-3
28 Business and Other Connections of C-4
Investment Adviser
29 Principal Underwriters C-10
30 Location of Accounts and Records C-13
31 Management Services C-13
32 Undertakings C-13
NOTE: * Omitted since answer is negative or inapplicable.
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PROSPECTUS NOVEMBER 28, 1994
DREYFUS NEW YORK MUNICIPAL CASH MANAGEMENT
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DREYFUS NEW YORK MUNICIPAL CASH MANAGEMENT (THE "FUND") IS AN
OPEN-END, NON-DIVERSIFIED, MANAGEMENT INVESTMENT COMPANY, KNOWN AS A MONEY
MARKET MUTUAL FUND. ITS GOAL IS TO PROVIDE INVESTORS WITH AS HIGH A LEVEL OF
CURRENT INCOME EXEMPT FROM FEDERAL, NEW YORK STATE AND NEW YORK CITY PERSONAL
INCOME TAXES TO THE EXTENT CONSISTENT WITH THE PRESERVATION OF CAPITAL AND
THE MAINTENANCE OF LIQUIDITY.
THE FUND IS DESIGNED FOR INSTITUTIONAL INVESTORS, PARTICULARLY BANKS,
ACTING FOR THEMSELVES OR IN A FIDUCIARY, ADVISORY, AGENCY, CUSTODIAL OR
SIMILAR CAPACITY. FUND SHARES MAY NOT BE PURCHASED DIRECTLY BY INDIVIDUALS,
ALTHOUGH INSTITUTIONS MAY PURCHASE SHARES FOR ACCOUNTS MAINTAINED BY
INDIVIDUALS. SUCH INSTITUTIONS HAVE AGREED TO TRANSMIT COPIES OF THIS
PROSPECTUS TO EACH INDIVIDUAL OR ENTITY FOR WHOSE ACCOUNT THE INSTITUTION
PURCHASES FUND SHARES, TO THE EXTENT REQUIRED BY LAW.
BY THIS PROSPECTUS, THE FUND IS OFFERING CLASS A SHARES AND CLASS B
SHARES. CLASS A SHARES AND CLASS B SHARES ARE IDENTICAL, EXCEPT AS TO THE
SERVICES OFFERED TO AND THE EXPENSES BORNE BY EACH CLASS. CLASS B BEARS
CERTAIN COSTS PURSUANT TO A SERVICE PLAN ADOPTED IN ACCORDANCE WITH RULE 12B-1
UNDER THE INVESTMENT COMPANY ACT OF 1940. INVESTORS CAN INVEST, REINVEST OR
REDEEM SHARES AT ANY TIME WITHOUT CHARGE OR PENALTY IMPOSED BY THE FUND.
THE DREYFUS CORPORATION SERVES AS THE FUND'S INVESTMENT ADVISER.
AN INVESTMENT IN THE FUND IS NEITHER INSURED NOR GUARANTEED BY THE
U.S. GOVERNMENT. THERE CAN BE NO ASSURANCE THAT THE FUND WILL BE ABLE TO
MAINTAIN A STABLE NET ASSET VALUE OF $1.00 PER SHARE.
THIS PROSPECTUS SETS FORTH CONCISELY INFORMATION ABOUT THE FUND THAT
AN INVESTOR SHOULD KNOW BEFORE INVESTING. IT SHOULD BE READ AND RETAINED FOR
FUTURE REFERENCE.
PART B (ALSO KNOWN AS THE STATEMENT OF ADDITIONAL INFORMATION), DATED
NOVEMBER 28, 1994, WHICH MAY BE REVISED FROM TIME TO TIME, PROVIDES A FURTHER
DISCUSSION OF CERTAIN AREAS IN THIS PROSPECTUS AND OTHER MATTERS WHICH MAY BE
OF INTEREST TO SOME INVESTORS. IT HAS BEEN FILED WITH THE SECURITIES AND
EXCHANGE COMMISSION AND IS INCORPORATED HEREIN BY REFERENCE. FOR A FREE COPY,
WRITE TO THE FUND AT 144 GLENN CURTISS BOULEVARD, UNIONDALE, NEW YORK
11556-0144, OR CALL 1-800-554-4611. WHEN TELEPHONING, ASK FOR OPERATOR 666.
MUTUAL FUND SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED
OR ENDORSED BY, ANY BANK, AND ARE NOT FEDERALLY INSURED BY THE FEDERAL
DEPOSIT INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD, OR ANY OTHER
AGENCY. ALL MONEY MARKET MUTUAL FUND SHARES INVOLVE CERTAIN INVESTMENT RISKS,
INCLUDING THE POSSIBLE LOSS OF PRINCIPAL.
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<TABLE>
<CAPTION>
TABLE OF CONTENTS
PAGE PAGE
<S> <C> <S> <C>
ANNUAL FUND OPERATING EXPENSES....... 3 INVESTOR SERVICES........................ 13
CONDENSED FINANCIAL INFORMATION...... 4 HOW TO REDEEM FUND SHARES................ 13
YIELD INFORMATION.................... 4 SERVICE PLAN............................. 14
DESCRIPTION OF THE FUND.............. 5 SHAREHOLDER SERVICES PLAN................ 15
MANAGEMENT OF THE FUND............... 10 DIVIDENDS, DISTRIBUTIONS AND TAXES ...... 15
HOW TO BUY FUND SHARES............... 11 GENERAL INFORMATION...................... 17
</TABLE>
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.
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THIS PAGE INTENTIONALLY LEFT BLANK
Page 2
<TABLE>
<CAPTION>
ANNUAL FUND OPERATING EXPENSES
(as a percentage of average daily net assets)
Class A Class B
Shares Shares
--------- ----------
<S> <C> <C>
Management Fees ..................................................... .20% .20%
12b-1 Fees (distribution and servicing) ............................. -- .25%
Total Fund Operating Expenses........................................ .20% .45%
EXAMPLE :
An investor would pay the following expenses on a $1,000
investment, assuming (1) 5% annual return and (2) redemption at
the end of each time period:
CLASS A CLASS B
SHARES SHARES
--------- ----------
1 Year.................................. $ 2 $ 5
3 Years................................. $ 6 $14
5 Years ................................ $11 $25
10 Years................................ $26 $57
</TABLE>
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THE AMOUNTS LISTED IN THE EXAMPLE SHOULD NOT BE CONSIDERED AS
REPRESENTATIVE OF PAST OR FUTURE EXPENSES AND ACTUAL EXPENSES MAY BE GREATER
OR LESS THAN THOSE INDICATED. MOREOVER, WHILE THE EXAMPLE ASSUMES A 5% ANNUAL
RETURN, THE FUND'S ACTUAL PERFORMANCE WILL VARY AND MAY RESULT IN AN ACTUAL
RETURN GREATER OR LESS THAN 5%.
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The purpose of the foregoing table is to assist investors in
understanding the various costs and expenses borne by the Fund, and therefore
indirectly by investors, the payment of which will reduce investors' return
on an annual basis. Unless The Dreyfus Corporation gives the Fund's investors
at least 90 days' notice to the contrary, The Dreyfus Corporation, and not
the Fund, will be liable for Fund expenses (exclusive of taxes, brokerage,
interest on borrowings and (with the prior written consent of the necessary
state securities commissions) extraordinary expenses) other than the
following expenses, which will be borne by the Fund: (i) the management fee
payable by the Fund monthly at the annual rate of .20 of 1% of the Fund's
average daily net assets and (ii) as to Class B shares only, payments made
pursuant to the Fund's Service Plan at the annual rate of .25 of 1% of the
value of the average daily net assets of Class B. Institutions and certain
Service Agents (as defined below) effecting transactions in Fund shares for
the accounts of their clients may charge their clients direct fees in
connection with such transactions; such fees are not reflected in the
foregoing table. See "Management of the Fund," "How to Buy Fund Shares,"
"Service Plan" and "Shareholder Services Plan."
Page 3
CONDENSED FINANCIAL INFORMATION
The information in the following table has been audited by Ernst &
Young LLP, the Fund's independent auditors, whose report thereon appears in
the Statement of Additional Information. Further financial data and related
notes are included in the Statement of Additional Information, available upon
request.
FINANCIAL HIGHLIGHTS
Contained below is per share operating performance data for a share
of beneficial interest outstanding, total investment return, ratios to
average net assets and other supplemental data for each year indicated. This
information has been derived from information provided in the Fund's
financial statements.
<TABLE>
<CAPTION>
CLASS A SHARES CLASS B SHARES
------------------------------- --------------
YEAR ENDED JULY 31, YEAR ENDED
-------------------------------
1992(1) 1993 1994 JULY 31, 1994(2)
------- ------ ------ ----------------
<S> <C> <C> <C> <C>
Per Share Data
Net asset value, beginning of year.............................. $1.0000 $1.0000 $1.0000 $1.0000
------- ------- ------- -------
INVESTMENT OPERATIONS;
Investment income--net ......................................... .0222 .0225 .0221 .0107
Net realized and unrealized gain (loss) on investments.......... -- -- -- --
------- ------- ------- -------
TOTAL FROM INVESTMENT OPERATIONS................................ .0222 .0225 .0221 .0107
DISTRIBUTIONS:
Dividends from investment income-net............................ (.0222) (.0225) (.0221) (.0107)
------- ------- ------- -------
Net asset value, end of year.................................... $1.0000 $1.0000 $1.0000 $1.0000
======= ======= ======== =======
TOTAL INVESTMENT RETURN 3.02%(3) 2.27% 2.23% 2.02%(3)
RATIOS / SUPPLEMENTAL DATA:
Ratio of expenses to average net assets......................... .20%(3) .20% .20% .45%(3)
Ratio of net investment income to average net assets ........... 2.71%(3) 2.20% 2.18% 2.12%(3)
Decrease reflected in above expense ratio due to
undertaking by The Dreyfus Corporation.......................... .37%(3) .18% .06% --
Net Assets, end of year (000's omitted)......................... $76,830 $116,527 $82,755 $53,324
- --------------------
</TABLE>
(1)From November 4, 1991 (commencement of operations) to July 31, 1992.
(2)From January 18, 1994 (commencement of initial offering) to July 31, 1994.
(3)Annualized.
YIELD INFORMATION
From time to time, the Fund advertises its yield and effective yield.
Both yield figures are based on historical earnings and are not intended to
indicate future performance. It can be expected that these yields will
fluctuate substantially. The yield of the Fund refers to the income generated
by an investment in the Fund over a seven-day period (which period will be
stated in the advertisement). This income is then annualized. That is, the
amount of income generated by the investment during that week is assumed to
be generated each week over a 52-week period and is shown as a percentage of
the investment. The effective yield is calculated similarly, but, when
annualized, the income earned by an investment in the Fund is assumed to be
reinvested. The effective yield will be slightly higher than the yield
because of the compounding effect of this assumed reinvestment. The Fund's
yield and effective yield may reflect absorbed expenses pursuant to any
undertaking that may be in effect. See "Management of the Fund." Both yield
figures also take into account any applicable distribution and service fees.
As a result, at any given time, the performance of Class B should be expected
to be lower than that of Class A. See "Service Plan."
Tax equivalent yield is calculated by determining the pre-tax yield
which, after being taxed at a stated rate (in the case of the Fund, typically
the combined highest Federal, New York State and New York City personal
income tax rates), would be equivalent to a stated yield or effective yield
calculated as described above.
Page 4
Yield information is useful in reviewing the Fund's performance, but
because yields will fluctuate, under certain conditions such information may
not provide a basis for comparison with domestic bank deposits, other
investments which pay a fixed yield for a stated period of time, or other
investment companies which may use different methods of computing yield.
Comparative performance information may be used from time to time in
advertising or marketing the Fund's shares, including data from Lipper
Analytical Services, Inc., Bank Rate Monitor trademark, IBC/Donoghue's Money
Fund Report, Morningstar, Inc. and other industry publications.
DESCRIPTION OF THE FUND
GENERAL -- By this Prospectus, two classes of shares of the Fund are being
offered -- Class A shares and Class B shares (each such class being referred
to as a "Class"). The Classes are identical, except that Class B shares are
subject to an annual distribution and service fee at the rate of .25% of the
value of the average daily net assets of Class B. The fee is payable for
advertising, marketing and distributing the Fund's Class B shares and for
ongoing personal services relating to Class B shareholder accounts and
services related to the maintenance of such shareholder accounts pursuant to
a Service Plan adopted in accordance with Rule 12b-1 under the Investment
Company Act of 1940. See "Service Plan." The distribution and service fee
paid by Class B will cause Class B to have a higher expense ratio and to pay
lower dividends than Class A.
WHEN USED IN THIS PROSPECTUS AND THE STATEMENT OF ADDITIONAL
INFORMATION, THE TERMS "INVESTOR" AND "SHAREHOLDER" REFER TO THE INSTITUTION
PURCHASING FUND SHARES AND DO NOT REFER TO ANY INDIVIDUAL OR ENTITY FOR WHOSE
ACCOUNT THE INSTITUTION MAY PURCHASE FUND SHARES. Such institutions have
agreed to transmit copies of this Prospectus and all relevant Fund materials,
including proxy materials, to each individual or entity for whose account the
institution purchases Fund shares, to the extent required by law.
INVESTMENT OBJECTIVE -- The Fund's goal is to provide investors with as high
a level of current income exempt from Federal, New York State and New York
City income taxes to the extent consistent with the preservation of capital
and the maintenance of liquidity. To accomplish this goal, the Fund invests
primarily in debt securities of the State of New York, its political
subdivisions, authorities and corporations, the interest from which is, in
the opinion of bond counsel to the issuer, exempt from Federal, New York
State and New York City income taxes (collectively, "New York Municipal
Obligations"). To the extent acceptable New York Municipal Obligations are at
any time unavailable for investment by the Fund, the Fund will invest, for
temporary defensive purposes, primarily in other debt securities the interest
from which is, in the opinion of bond counsel to the issuer, exempt from
Federal, but not New York State or New York City, income tax. The Fund's
investment objective cannot be changed without approval by the holders of a
majority (as defined in the Investment Company Act of 1940) of the Fund's
outstanding voting shares. There can be no assurance that the Fund's
investment objective will be achieved. Securities in which the Fund invests
may not earn as high a level of current income as long-term or lower quality
securities which generally have less liquidity, greater market risk and more
fluctuation in market value.
MUNICIPAL OBLIGATIONS -- Debt securities the interest from which is, in the
opinion of bond counsel to the issuer, exempt from Federal income tax
("Municipal Obligations") generally include debt obligations issued to obtain
funds for various public purposes as well as certain industrial development
bonds issued by or on behalf of public authorities. Municipal Obligations are
classified as general obligation bonds, revenue bonds and notes. General
obligation bonds are secured by the issuer's pledge of its faith, credit and
taxing power for the payment of principal and interest . Revenue bonds are
payable from the revenue derived from a particular facility or class of
facilities or, in some cases, from the proceeds of a special excise or other
specific revenue source, but not from the general taxing power. Tax exempt
Page 5
industrial development bonds, in most cases, are revenue bonds that do not
carry the pledge of the credit of the issuing municipality, but generally are
guaranteed by the corporate entity on whose behalf they are issued. Notes are
short-term instruments which are obligations of the issuing municipalities or
agencies and are sold in anticipation of a bond sale, collection of taxes or
receipt of other revenues. Municipal Obligations include municipal
lease/purchase agreements which are similar to installment purchase contracts
for property or equipment issued by municipalities. Municipal Obligations
bear fixed, floating or variable rates of interest.
MANAGEMENT POLICIES _ It is a fundamental policy of the Fund that it will
invest at least 80% of the value of its net assets (except when maintaining a
temporary defensive position) in Municipal Obligations. Under normal
circumstances, at least 65% of the value of the Fund's net assets will be
invested in New York Municipal Obligations and the remainder may be invested
in securities which are not New York Municipal Obligations and therefore may
be subject to New York State and New York City income taxes. See "Risk
Factors_Investing in New York Municipal Obligations" below, and "Dividends,
Distributions and Taxes."
The Fund seeks to maintain a net asset value of $1.00 per share for
purchases and redemptions. To do so, the Fund uses the amortized cost method
of valuing its securities pursuant to Rule 2a-7 under the Investment Company
Act of 1940, certain requirements of which are summarized as follows. In
accordance with Rule 2a-7, the Fund will maintain a dollar-weighted average
portfolio maturity of 90 days or less, purchase only instruments having
remaining maturities of 13 months or less and invest only in U.S. dollar
denominated securities determined in accordance with procedures established
by the Board of Trustees to present minimal credit risks and which are rated
in one of the two highest rating categories for debt obligations by at least
two nationally recognized statistical rating organizations (or one rating
organization if the instrument was rated only by one such organization) or,
if unrated, are of comparable quality as determined in accordance with
procedures established by the Board of Trustees. Moreover, the Fund will
purchase commercial paper, or other instruments having only commercial paper
ratings, only if the security is rated in the highest rating category by at
least one nationally recognized statistical rating organization or, if unrated
, of comparable quality as determined in accordance with such procedures. The
nationally recognized statistical rating organizations currently rating
instruments of the type the Fund may purchase are Moody's Investors Services,
Inc. ("Moody's"), Standard & Poor's Corporation ("S&P") and Fitch Investors
Service, Inc. ("Fitch") and their rating criteria are described in Appendix B
to the Fund's Statement of Additional Information. For further information
regarding the amortized cost method of valuing securities, see "Determination
of Net Asset Value" in the Fund's Statement of Additional Information. There
can be no assurance that the Fund will be able to maintain a stable net asset
value of $1.00 per share.
The Fund may invest more than 25% of the value of its total assets in
Municipal Obligations which are related in such a way that an economic,
business or political development or change affecting one such security also
would affect the other securities; for example, securities the interest upon
which is paid from revenues of similar types of projects. As a result, the
Fund may be subject to greater risk as compared to a fund that does not
follow this practice.
From time to time, the Fund may invest more than 25% of the value of
its total assets in industrial development bonds which, although issued by
industrial development authorities, may be backed only by the assets and
revenues of the non-governmental users. Interest on Municipal Obligations
(including certain industrial development bonds) which are specified private
activity bonds, as defined in the Internal Revenue Code of 1986, as amended
(the "Code"), issued after August 7, 1986, while exempt from Federal income
tax, is a preference item for the purpose of the alternative minimum tax.
Where a regulated investment company receives such interest, a proportionate
share of any exempt-interest dividend paid by the investment company may be
treated as such a preference item to shareholders. The
Page 6
Fund may invest without limitation in such Municipal Obligations if The
Dreyfus Corporation determines that their purchase is consistent with the
Fund's investment objective.
The Fund may purchase floating and variable rate demand notes and
bonds, which are tax exempt obligations ordinarily having stated maturities
in excess of 13 months, but which permit the holder to demand payment of
principal at any time, or at specified intervals not exceeding 13 months, in
each case upon not more than 30 days' notice. Variable rate demand notes
include master demand notes which are obligations that permit the Fund to
invest fluctuating amounts, which may change daily without penalty, pursuant
to direct arrangements between the Fund, as lender, and the borrower. The
interest rates on these obligations fluctuate from time to time. Frequently,
such obligations are secured by letters of credit or other credit support
arrangements provided by banks. Use of letters of credit or other credit
support arrangements will not adversely affect the tax exempt status of these
obligations. Because these obligations are direct lending arrangements
between the lender and borrower, it is not contemplated that such instruments
generally will be traded, and there generally is no secondary market for
these obligations, although they are redeemable at face value. Accordingly,
where these obligations are not secured by letters of credit or other credit
support arrangements, the Fund's right to redeem is dependent on the ability
of the borrower to pay principal and interest on demand. Each obligation
purchased by the Fund will meet the quality criteria established for the
purchase of Municipal Obligations. The Dreyfus Corporation, on behalf of the
Fund, will consider on an ongoing basis the creditworthiness of the issuers
of the floating and variable rate demand obligations in the Fund's portfolio.
The Fund will not invest more than 10% of the value of its net assets in
floating or variable rate demand obligations as to which it cannot exercise
the demand feature on not more than seven days' notice if there is no
secondary market available for these obligations, and in other securities
that are illiquid.
The Fund may purchase from financial institutions participation
interests in Municipal Obligations (such as industrial development bonds and
municipal lease/purchase agreements). A participation interest gives the Fund
an undivided interest in the Municipal Obligation in the proportion that the
Fund's participation interest bears to the total principal amount of the
Municipal Obligation. These instruments may have fixed, floating or variable
rates of interest, with remaining maturities of 13 months or less. If the
participation interest is unrated, or has been given a rating below that
which otherwise is permissible for purchase by the Fund, the participation
interest will be backed by an irrevocable letter of credit or guarantee of a
bank that the Board of Trustees has determined meets the prescribed quality
standards for banks set forth below, or the payment obligation otherwise will
be collateralized by U.S. Government securities. For certain participation
interests, the Fund will have the right to demand payment, on not more than
seven days' notice, for all or any part of the Fund's participation interest
in the Municipal Obligation, plus accrued interest. As to these instruments,
the Fund intends to exercise its right to demand payment only upon a default
under the terms of the Municipal Obligation, as needed to provide liquidity
to meet redemptions, or to maintain or improve the quality of its investment
portfolio. The Fund will not invest more than 10% of the value of its net
assets in participation interests that do not have this demand feature, and
in other securities that are illiquid.
The Fund may acquire "stand-by commitments" with respect to Municipal
Obligations held in its portfolio. Under a standby commitment, the Fund
obligates a broker, dealer or bank to repurchase at the Fund's option
specified securities at a specified price and, in this respect, stand-by
commitments are comparable to put options. The exercise of a stand-by
commitment, therefore, is subject to the ability of the seller to make
payment on demand. The Fund will acquire stand-by commitments solely to
facilitate portfolio liquidity and does not intend to exercise its rights
thereunder for trading purposes. The Fund may pay for stand-by commitments if
such action is deemed necessary, thus increasing to a degree the cost of the
underlying Municipal Obligation and similarly decreasing such security's
yield to investors. Gains realized in connection with stand-by commitments
will be taxable.
Page 7
From time to time, on a temporary basis other than for temporary
defensive purposes (but not to exceed 20% of the value of the Fund's net
assets) or for temporary defensive purposes, the Fund may invest in taxable
short-term investments ("Taxable Investments") consisting of: notes of
issuers having, at the time of purchase, a quality rating within the two
highest grades of Moody's, S&P or Fitch; obligations of the U.S. Government,
its agencies or instrumentalities; commercial paper rated not lower than P-l
by Moody's, A-l by S&P or F-l by Fitch; certificates of deposit of U.S.
domestic banks, including foreign branches of domestic banks, with assets of
one billion dollars or more; time deposits; bankers' acceptances and other
short-term bank obligations; and repurchase agreements in respect of any of
the foregoing. Dividends paid by the Fund that are attributable to income
earned by the Fund from Taxable Investments will be taxable to investors. See
"Dividends, Distributions and Taxes." Except for temporary defensive
purposes, at no time will more than 20% of the value of the Fund's net assets
be invested in Taxable Investments. If the Fund purchases Taxable
Investments, it will value them using the amortized cost method and comply
with the provisions of Rule 2a-7 relating to purchases of taxable
instruments. When the Fund has adopted a temporary defensive position,
including when acceptable New York Municipal Obligations are unavailable for
investment by the Fund, in excess of 35% of the Fund's net assets may be
invested in securities that are not exempt from New York State and New York
City income taxes. Under normal market conditions, the Fund anticipates that
not more than 5% of the value of its total assets will be invested in any one
category of Taxable Investments. Taxable Investments are more fully described
in the Statement of Additional Information, to which reference hereby is
made.
CERTAIN FUNDAMENTAL POLICIES -- The Fund may (i) borrow money from banks, but
only for temporary or emergency (not leveraging) purposes, in an amount up to
15% of the value of the Fund's total assets (including the amount borrowed)
valued at the lesser of cost or market, less liabilities (not including the
amount borrowed) at the time the borrowing is made. While borrowings exceed
5% of the Fund's total assets, the Fund will not make any additional
investments; (ii) pledge, hypothecate, mortgage or otherwise encumber its
assets, but only to secure borrowings for temporary or emergency purposes;
and (iii) invest up to 25% of its total assets in the securities of issuers
in any industry, provided that there is no such limitation on investments in
Municipal Obligations and, for temporary defensive purposes, obligations
issued or guaranteed by the U.S. Government, its agencies or
instrumentalities. This paragraph describes fundamental policies that cannot
be changed without approval by the holders of a majority (as defined in the
Investment Company Act of 1940) of the Fund's outstanding voting shares. See
"Investment Objective and Management Policies-Investment Restrictions" in the
Statement of Additional Information.
CERTAIN ADDITIONAL NON-FUNDAMENTAL POLICY -- The Fund may invest up to 10% of
its net assets in repurchase agreements providing for settlements in more
than seven days after notice and in other illiquid securities (which
securities could include participation interests (including municipal
lease/purchase agreements) that are not subject to the demand feature
described above and floating and variable rate demand obligations as to
which the Fund cannot exercise the related demand feature described above
and as to which there is no secondary market). See "Investment Objective and
Management Policies-Investment Restrictions" in the Statement of Additional
Information.
RISK FACTORS
INVESTING IN NEW YORK MUNICIPAL OBLIGATIONS -- Investors should consider
carefully the special risks inherent in the Fund's investment in New York
Municipal Obligations. These risks result from the financial condition of New
York State, certain of its public bodies and municipalities, and New York
City. Beginning in early 1975, New York State, New York City and other State
entities faced serious financial difficulties which jeopardized the credit
standing and impaired the borrowing abilities of such entities and
contributed to high interest rates on, and lower market prices for, debt
obligations issued by
Page 8
them. A recurrence of such financial difficulties or a
failure of certain financial recovery programs could result in defaults or
declines in the market values of various New York Municipal Obligations in
which the Fund may invest. If there should be a default or other financial
crisis relating to New York State, New York City, a State or City agency, or
a State municipality, the market value and marketability of outstanding New
York Municipal Obligations in the Fund's portfolio and the interest income to
the Fund could be adversely affected. Moreover, the significant slowdown in
the New York and regional economies in the early 1990's added substantial
uncertainty to estimates of the State's tax revenues, which, in part, caused
the State to overestimate its General Fund tax receipts for the 1992 fiscal
year by $575 million. The 1992 fiscal year was the fourth consecutive year in
which the State incurred a cash-basis operating deficit in the General Fund
and issued deficit notes. The State's 1993 fiscal year, however, was
characterized by national and regional economies that performed better than
projected. After reflecting a 1993 year-end deposit to the refund reserve
account of $671 million, reported 1993 General Fund receipts were $45
million higher than originally projected in April 1992. If not for that
year-end transaction, General Fund receipts would have been $716 million
higher than originally projected. There can be no assurance that New York
will not face substantial potential budget gaps in future years. In 1990,
S&P and Moody's lowered their ratings of the State's general obligation debt
from AA- to A and from Al to A, respectively. In addition, S&P and Moody's
lowered their ratings in 1990 on New York's short-term notes from SP-l+ to
SP-l and from MIG-l to MIG-2, respectively. In January l992, Moody's lowered
from A to Baa1 its ratings of certain appropriation-backed debt of New York
State and its agencies and S&P lowered from A to A- its ratings of New York
State general obligation bonds. S&P also lowered its ratings of various
agency debt, State moral obligations, contractual obligations, lease purchase
obligations and State guarantees. In February 1991, Moody's lowered its
rating of New York City's general obligation bonds from A to Baal. The rating
changes reflect the rating agencies' concerns about the financial condition
of New York State and City, the heavy debt load of the State and City, and
economic uncertainties in the region. Investors should obtain and review a
copy of the Statement of Additional Information which more fully sets forth
these and other risk factors.
INVESTMENT CONSIDERATIONS--Even though interest-bearing securities are
investments which promise a stable stream of income, the prices of such
securities are inversely affected by changes in interest rates and,
therefore, are subject to the risk of market price fluctuations. The values
of fixed-income securities also may be affected by changes in the credit
rating or financial condition of the issuing entities.
New issues of Municipal Obligations usually are offered on a
when-issued basis, which means that delivery and payment for such Municipal
Obligations ordinarily take place within 45 days after the date of the
commitment to purchase. The payment obligation and the interest rate that
will be received on the Municipal Obligations are fixed at the time the Fund
enters into the commitment. The Fund will make commitments to purchase such
Municipal Obligations only with the intention of actually acquiring the securi
ties, but the Fund may sell these securities before the settlement date if it
is deemed advisable, although any gain realized on such sale would be
taxable. The Fund will not accrue income in respect of a when-issued security
prior to its stated delivery date. No additional when-issued commitments will
be made if more than 20% of the value of the Fund's net assets would be so
committed.
Municipal Obligations purchased on a when-issued basis and the
securities held in the Fund's portfolio are subject to changes in value (both
generally changing in the same way, i.e., appreciating when interest rates
decline and depreciating when interest rates rise) based upon the public's
perception of the creditworthiness of the issuer and changes, real or
anticipated, in the level of interest rates. Municipal Obligations purchased
on a when-issued basis may expose the Fund to risk because they may experience
such fluctuations prior to their actual delivery. Purchasing Municipal
Obligations on a when-issued basis can involve the additional risk that the
yield available in the market when the delivery takes place actually may be
higher than that obtained in the transaction itself. A segregated account of
the Fund
Page 9
consisting of cash, cash equivalents or U.S. Government securities
or other high quality liquid debt securities at least equal at all times to
the amount of the when-issued commitments will be established and maintained
at the Fund's custodian bank. Purchasing Municipal Obligations on a
when-issued basis when the Fund is fully or almost fully invested may result
in greater potential fluctuation in the value of the Fund's net assets and
its net asset value per share.
Certain provisions in the Code relating to the issuance of Municipal
Obligations may reduce the volume of Municipal Obligations qualifying for
Federal tax exemption. One effect of these provisions could be to increase
the cost of the Municipal Obligations available for purchase by the Fund and
thus reduce available yield. Shareholders should consult their tax advisers
concerning the effect of these provisions on an investment in the Fund.
Proposals that may restrict or eliminate the income tax exemption for
interest on Municipal Obligations may be introduced in the future. If any
such proposal were enacted that would reduce the availability of Municipal
Obligations for investment by the Fund so as to adversely affect Fund
shareholders, the Fund would reevaluate its investment objective and policies
and submit possible changes in the Fund's structure to shareholders for their
consideration. If legislation were enacted that would treat a type of
Municipal Obligation as taxable, the Fund would treat such security as a
permissible Taxable Investment within the applicable limits set forth herein.
The Fund's classification as a "non-diversified" investment company
means that the proportion of the Fund's assets that may be invested in the
securities of a single issuer is not limited by the Investment Company Act of
1940. A "diversified" investment company is required by the Investment
Company Act of 1940 generally to invest, with respect to 75% of its total
assets, not more than 5% of such assets in the securities of a single issuer.
However, the Fund intends to conduct its operations so as to qualify as a
"regulated investment company" for purposes of the Code, which requires that,
at the end of each quarter of the taxable year, (i) at least 50% of the
market value of the Fund's total assets be invested in cash, U.S. Government
securities, the securities of other regulated investment companies and other
securities, with such other securities of any one issuer limited for the
purposes of this calculation to an amount not greater than 5% of the value of
the Fund's total assets, and (ii) not more than 25% of the value of its total
assets be invested in the securities of any one issuer (other than U.S.
Government securities or the securities of other regulated investment
companies). Since a relatively high percentage of the Fund's assets may be
invested in the obligations of a limited number of issuers, the Fund's
portfolio securities may be more susceptible to any single economic,
political or regulatory occurrence than the portfolio securities of a
diversified investment company.
Investment decisions for the Fund are made independently from those
of other investment companies advised by The Dreyfus Corporation. However, if
such other investment companies are prepared to invest in, or desire to
dispose of, Municipal Obligations or Taxable Investments at the same time as
the Fund, available investments or opportunities for sales will be allocated
equitably to each investment company. In some cases, this procedure may
adversely affect the size of the position obtained for or disposed of by the
Fund or the price paid or received by the Fund.
MANAGEMENT OF THE FUND
The Dreyfus Corporation, located at 200 Park Avenue, New York, New
York 10166, was formed in 1947 and serves as the Fund's investment adviser.
The Dreyfus Corporation is a wholly-owned subsidiary of Mellon Bank N.A.,
which is a wholly-owned subsidiary of Mellon Bank Corporation ("Mellon"). As
of August 31, 1994, The Dreyfus Corporation managed or administered
approximately $70 billion in assets for more than 1.9 million investor
accounts nationwide.
The Dreyfus Corporation supervises and assists in the overall
management of the Fund's affairs under a Management Agreement with the Fund,
subject to the overall authority of the Fund's Board of Trustees in
accordance with Massachusetts law.
Page 10
Mellon is a publicly owned multibank holding company incorporated
under Pennsylvania law in 1971 and registered under the Federal Bank Holding
Company Act of 1956, as amended. Mellon provides a comprehensive range of
financial products and services in domestic and selected international
markets. Mellon is among the twenty-five largest bank holding companies in
the United States based on total assets. Mellon's principal wholly-owned
subsidiaries are Mellon Bank, N.A., Mellon Bank (DE) National Association,
Mellon Bank (MD), The Boston Company, Inc., AFCOCredit Corporation and a
number of companies known as Mellon Financial Services Corporations. Through
its subsidiaries, Mellon managed more than $130 billion in assets as of July
31, 1994, including approximately $6 billion in mutual fund assets. As of
June 30, 1994, various subsidiaries of Mellon provided non-investment
services, such as custodial or administration services, for approximately
$747 billion in assets including approximately $97 billion in mutual fund
assets.
Under the terms of the Management Agreement, the Fund has agreed to
pay The Dreyfus Corporation a monthly fee at the annual rate of .20 of 1% of
the value of the Fund's average daily net assets. For the fiscal year ended
July 31, 1994, the Fund paid The Dreyfus Corporation a monthly management fee
at the effective annual rate of .14 of 1% of the value of the Fund's average
daily net assets, pursuant to an undertaking by the Dreyfus Corporation then
in effect. For the period from January 18, 1994 (commencement of initial
offering of Class B shares) through July 31, 1994, the effective annual rate
of the management fee was .20 of 1% of the value of the Fund's average daily
net assets.
Unless The Dreyfus Corporation gives the Fund's investors at least 90
days' notice to the contrary, The Dreyfus Corporation, and not the Fund, will
be liable for Fund expenses (exclusive of taxes, brokerage, interest on
borrowings and (with the prior written consent of the necessary state
securities commissions) extraordinary expenses) other than the following
expenses, which will be borne by the Fund: (i)the management fee payable by
the Fund monthly at the annual rate of .20 of 1% of the Fund's average daily
net assets and (ii) as to Class B shares only, payments made pursuant to the
Fund's Service Plan at the annual rate of .25 of 1% of the value of the
average daily net assets of Class B. See "Service Plan." The Fund will not
reimburse The Dreyfus Corporation in respect of any amounts the Fund may
deduct or The Dreyfus Corporation may bear.
The Shareholder Services Group, Inc., a subsidiary of First Data
Corporation, P.O. Box 9671, Providence, Rhode Island 02940-9671, is the
Fund's Transfer and Dividend Disbursing Agent (the "Transfer Agent"). The
Bank of New York, 110 Washington Street, New York, New York 10286, is the
Fund's Custodian.
HOW TO BUY FUND SHARES
The Fund's distributor is Premier Mutual Fund Services, Inc. (the
"Distributor"), located at One Exchange Place, Boston, Massachusetts 02109.
The Distributor is a wholly-owned subsidiary of Institutional Administration
Services, Inc., a provider of mutual fund administration services, the parent
company of which is Boston Institutional Group, Inc.
The Fund is designed for institutional investors, particularly banks,
acting for themselves or in a fiduciary, advisory, agency, custodial or
similar capacity. Fund shares may not be purchased directly by individuals,
although institutions may purchase shares for accounts maintained by
individuals. Generally, each investor will be required to open a single
master account with the Fund for all purposes. In certain cases, the Fund may
request investors to maintain separate master accounts for shares held by the
investor (i) for its own account, for the account of other institutions and
for accounts for which the institution acts as a fiduciary, and (ii) for
accounts for which the investor acts in some other capacity. An institution
may arrange with the Transfer Agent for sub-accounting services and will be
charged directly for the cost of such services.
The minimum initial investment is $10,000,000, unless: (a) the
investor has invested at least $10,000,000 in the aggregate among the Fund,
Dreyfus Cash Management, Dreyfus Cash Management
Page 11
Plus, Inc., Dreyfus Government Cash Management, Dreyfus Municipal Cash
Management Plus, Dreyfus Tax Exempt Cash Management, Dreyfus Treasury Cash
Management and Dreyfus Treasury Prime Cash Management; or (b) the investor
has, in the opinion of the Distributor, adequate intent and availability of
funds to reach a future level of investment of $10,000,000 among the funds
identified above. There is no minimum for subsequent purchases. The initial
investment must be accompanied by the Fund's Account Application. Management
understands that some financial institutions, securities dealers and other
industry professionals (collectively, "Service Agents") and other institutions
may charge their clients fees in connection with purchases for the accounts of
their clients. These fees would be in addition to any amounts which might be
received under the Service Plan. Service Agents may receive different levels
of compensation for selling different classes of shares. Each Service Agent
has agreed to transmit to its clients a schedule of such fees. Share
certificates are issued only upon the investor's written request. No
certificates are issued for fractional shares. It is not recommended that the
Fund be used as a vehicle for Keogh, IRA or other qualified retirement plans.
The Fund reserves the right to reject any purchase order.
Fund shares may be purchased by wire, by telephone or through
compatible computer facilities. All payments should be made in U.S. dollars
and, to avoid fees and delays, should be drawn only on U.S. banks. For
instructions concerning purchases and to determine whether their computer
facilities are compatible with the Fund's, investors should call the
Distributor at one of the telephone numbers listed under "General
Information" in this Prospectus.
Fund shares are sold on a continuous basis at the net asset value per
share next determined after an order in proper form and Federal Funds (monies
of member banks in the Federal Reserve System which are held on deposit at a
Federal Reserve Bank) are received by the Transfer Agent. If an investor does
not remit Federal Funds, its payment must be converted into Federal Funds.
This usually occurs within one business day of receipt of a bank wire and
within two business days of receipt of a check drawn on a member bank of the
Federal Reserve System. Checks drawn on banks which are not members of the
Federal Reserve System may take considerably longer to convert into Federal
Funds. Prior to receipt of Federal Funds, the investor's money will not be
invested.
The Fund's net asset value per share is determined as of 12:00 Noon,
New York time, on each day that the New York Stock Exchange is open for
business. Net asset value per share of each class is computed by dividing the
value of the Fund's net assets represented by such class (i.e., the value of
its assets less liabilities) by the total number of shares of such class
outstanding. See "Determination of Net Asset Value" in the Fund's Statement
of Additional Information.
Except in the case of telephone orders, investors whose payments are
received in or converted into Federal Funds by 12:00 Noon, New York time, by
the Transfer Agent will receive the dividend declared that day. Investors
whose payments are received in or converted into Federal Funds after 12:00
Noon, New York time, by the Transfer Agent will begin to accrue dividends on
the following business day.
Investors may telephone orders for purchase of the Fund's shares.
These orders will become effective at the price determined at 12:00 Noon, New
York time, and the shares purchased will receive the dividend on Fund shares
declared on that day if the telephone order is placed by 12:00 Noon, New York
time, and Federal Funds are received by 4:00 p.m., New York time, on that
day.
Federal regulations require that an investor provide a certified
Taxpayer Identification Number ("TIN") upon opening or reopening an account.
See "Dividends, Distributions and Taxes" and the Fund's Account Application
for further information concerning this requirement. Failure to furnish a
certified TIN to the Fund could subject an investor to a $50 penalty imposed
by the Internal Revenue Service (the "IRS").
Page 12
INVESTOR SERVICES
EXCHANGE PRIVILEGE -- The Exchange Privilege enables an investor to purchase,
in exchange for Class A or Class B shares of the Fund, shares of Dreyfus Cash
Management, Dreyfus Cash Management Plus, Inc., Dreyfus Government Cash
Management, Dreyfus Municipal Cash Management Plus, Dreyfus Tax Exempt Cash
Management, Dreyfus Treasury Cash Management and Dreyfus Treasury Prime Cash
Management, which have different investment objectives that may be of
interest to investors. Upon an exchange into a new account, the following shar
eholder services and privileges, as applicable and where available, will be
automatically carried over to the fund into which the exchange is being made:
Exchange Privilege, Redemption by Wire or Telephone, Redemption Through
Compatible Computer Facilities and the dividend/capital gain distribution
option selected by the investor.
To use this Privilege, exchange instructions must be given to the
Distributor in writing, by wire or by telephone. See "How to Redeem Fund
Shares_Procedures." Before any exchange, the investor must obtain and should
review a copy of the current prospectus of the fund into which the exchange
is being made. Prospectuses may be obtained from the Distributor. Shares will
be exchanged at the net asset value next determined after receipt of an
exchange request in proper form. The exchange of shares of one fund for
shares of another fund is treated for Federal income tax purposes as a sale
of the shares given in exchange by the investor and, therefore, an exchanging
investor may realize a taxable gain or loss. No fees currently are charged
investors directly in connection with exchanges, although the Fund reserves
the right, upon not less than 60 days' written notice, to charge investors a
nominal fee in accordance with rules promulgated by the Securities and
Exchange Commission. The Fund reserves the right to reject any exchange
request in whole or in part. The Exchange Privilege may be modified or
terminated at any time upon notice to investors.
DREYFUS AUTO-EXCHANGE PRIVILEGE -- Dreyfus Auto-Exchange Privilege enables an
investor to invest regularly (on a semi-monthly, monthly, quarterly or annual
basis), in exchange for Class A or Class B shares of the Fund, in shares of
Dreyfus Cash Management, Dreyfus Cash Management Plus, Inc., Dreyfus
Government Cash Management, Dreyfus Municipal Cash Management Plus, Dreyfus
Tax Exempt Cash Management, Dreyfus Treasury Cash Management or Dreyfus
Treasury Prime Cash Management, if the investor is currently an investor in
one of these funds. The amount an investor designates, which can be expressed
either in terms of a specific dollar or share amount, will be exchanged
automatically on the first and/or fifteenth of the month according to the
schedule that the investor has selected. Shares will be exchanged at the
then-current net asset value. The right to exercise this Privilege may be
modified or cancelled by the Fund or the Transfer Agent. An investor may
modify or cancel the exercise of this Privilege at any time by writing to The
Dreyfus Institutional Services Division, EAB Plaza, 144 Glenn Curtiss
Boulevard, 8th Floor, Uniondale, New York 11556-0144. The Fund may charge a
service fee for the use of this Privilege. No such fee currently is
contemplated. The exchange of shares of one fund for shares of another is
treated for Federal income tax purposes as a sale of the shares given in
exchange by the investor and, therefore, an exchanging investor may realize a
taxable gain or loss. For more information concerning this Privilege and the
funds eligible to participate in this Privilege, or to obtain a Dreyfus
Auto-Exchange Authorization Form, please call in New York State
1-718-895-1650; outside New York State call toll free 1-800-346-3621.
HOW TO REDEEM FUND SHARES
GENERAL -- Investors may request redemption of shares at any time and the
shares will be redeemed at the next determined net asset value.
The Fund imposes no charges when shares are redeemed directly through
the Distributor. Service Agents or other institutions may charge their
clients a nominal fee for effecting redemptions of Fund shares. Any share
certificates representing Fund shares being redeemed must be submitted with
the
Page 13
redemption request. The value of the shares redeemed may be more or less
than their original cost, depending upon the Fund's then-current net asset
value.
If a request for redemption is received in proper form by the
Distributor by 12:00 Noon, New York time, the proceeds of the redemption, if
transfer by wire is requested, ordinarily will be transmitted in Federal
Funds on the same day and the shares will not receive the dividend declared
on that day. If the request is received later that day by the Distributor,
the shares will receive the dividend on the Fund's shares declared on that
day and the proceeds of redemption, if wire transfer is requested, ordinarily
will be transmitted in Federal Funds on the next business day.
The Fund ordinarily will make payment for all shares redeemed within
seven days after receipt by the Transfer Agent of a redemption request in
proper form, except as provided by the rules of the Securities and Exchange
Commission.
PROCEDURES -- Investors may redeem Fund shares by wire or telephone, or
through compatible computer facilities as described below.
An investor may redeem or exchange Fund shares by telephone if the
investor has checked the appropriate box on the Fund's Account Application or
has filed a Shareholder Services Form with the Transfer Agent. If an investor
selects a telephone redemption or exchange privilege, the investor authorizes
the Transfer Agent or the Distributor to act on telephone instructions from
any person representing himself or herself to be an authorized representative
of the investor, and reasonably believed by the Transfer Agent or the
Distributor, as the case may be, to be genuine. The Fund will require the
Transfer Agent and the Distributor to employ procedures, such as requiring a
form of personal identification, to confirm that instructions are genuine
and, if they do not follow such procedures, the Fund, the Distributor or the
Transfer Agent may be liable for any losses due to unauthorized or fraudulent
instructions. The Fund, the Distributor or the Transfer Agent will not be
liable for following telephone instructions reasonably believed to be
genuine.
During times of drastic economic or market conditions, investors may
experience difficulty in contacting the Transfer Agent or the Distributor by
telephone to request a redemption or exchange of Fund shares. In such cases,
investors should consider using the other redemption procedures described
herein.
REDEMPTION BY WIRE OR TELEPHONE -- Investors may redeem Fund shares by wire
or telephone. The redemption proceeds will be paid by wire transfer.
Investors can redeem shares by telephone by calling the Distributor at one of
the telephone numbers listed under "General Information" in this Prospectus.
The Fund reserves the right to refuse any request made by wire or telephone
and may limit the amount involved or the number of telephone redemptions.
This procedure may be modified or terminated at any time by the Transfer
Agent or the Fund. The Fund's Statement of Additional Information sets forth
instructions for redeeming shares by wire. Shares for which certificates have
been issued may not be redeemed by wire or telephone.
REDEMPTION THROUGH COMPATIBLE COMPUTER FACILITIES -- The Fund makes available
to institutions the ability to redeem shares through compatible computer
facilities. Investors desiring to redeem shares in this manner should call
the Distributor at one of the telephone numbers listed under "General
Information" in this Prospectus to determine whether their computer
facilities are compatible and to receive instructions for redeeming shares in
this manner.
SERVICE PLAN
(Class B Only)
Class B shares are subject to a Service Plan adopted pursuant to Rule
12b-1 under the Investment Company Act of 1940. Under the Service Plan, the
Fund (a) reimburses the Distributor for distributing the Fund's Class B
shares and (b) pays The Dreyfus Corporation, Dreyfus Service Corporation, a
wholly-owned subsidiary of The Dreyfus Corporation, and any affiliate of
either of them (collectively,
Page 14
"Dreyfus") for advertising and marketing
relating to the Fund's Class B shares and for providing certain services
relating to Class B shareholder accounts, such as answering shareholder
inquiries regarding the Fund and providing reports and other information, and
services related to the maintenance of shareholder accounts("Servicing"), at
an aggregate annual rate of .25 of 1% of the value of the average daily net
assets of Class B. Each of the Distributor and Dreyfus may pay one or more
Service Agents a fee in respect of the Fund's Class B shares owned by
shareholders with whom the Service Agent has a Servicing relationship or for
whom the Service Agent is the dealer or holder of record. Each of the
Distributor and Dreyfus determines the amounts, if any, to be paid to Service
Agents under the Service Plan and the basis on which such payments are made.
The fee payable for Servicing is intended to be a "service fee" as defined in
Article III, Section 26 of the NASD Rules of Fair Practice. The fees payable
under the Service Plan are payable without regard to actual expenses
incurred.
SHAREHOLDER SERVICES PLAN
(Class A Only)
Class A shares are subject to a Shareholder Services Plan pursuant to
which the Fund has agreed to reimburse Dreyfus Service Corporation an amount
not to exceed an annual rate of .25 of 1% of the value of the average daily
net assets of the Class A shares for certain allocated expenses of providing
personal services to, and/or maintaining accounts of, Class A shareholders.
The services provided may include personal services relating to shareholder
accounts, such as answering shareholder inquiries regarding the Fund and
providing reports and other information, and services related to the
maintenance of shareholder accounts. Pursuant to an undertaking by The
Dreyfus Corporation described under "Management of the Fund," The Dreyfus
Corporation, and not the Fund, currently reimburses Dreyfus Service
Corporation for any such allocated expenses.
DIVIDENDS, DISTRIBUTIONS AND TAXES
The Fund ordinarily declares dividends from its net investment income
on each day the New York Stock Exchange or the Transfer Agent is open for
business. Fund shares begin earning income dividends on the day the purchase
order is effective. The Fund's earnings for Saturdays, Sundays and holidays
are declared as dividends on the next business day. Dividends usually are
paid on the last calendar day of each month, and are automatically reinvested
in additional Fund shares at net asset value or, at the investor's option,
paid in cash. If an investor redeems all shares in its account at any time
during the month, all dividends to which the investor is entitled will be
paid along with the proceeds of the redemption. Distributions from net
realized securities gains, if any, generally are declared and paid once a
year, but the Fund may make distributions on a more frequent basis to comply
with the distribution requirements of the Code, in all events in a manner
consistent with the provisions of the Investment Company Act of 1940. The
Fund will not make distributions from net realized securities gains unless
capital loss carryovers, if any, have been utilized or have expired.
Investors may choose whether to receive distributions in cash or to reinvest
in additional Fund shares at net asset value. All expenses are accrued daily
and deducted before declaration of dividends to investors. Dividends paid by
each Class will be calculated at the same time and in the same manner and
will be of the same amount, except that the expenses attributable solely to
Class A or Class B will be borne exclusively by such Class. Class B shares
will receive lower per share dividends than Class A shares because of the
higher expenses borne by Class B. See "Annual Fund Operating Expenses."
Except for dividends from Taxable Investments, the Fund anticipates
that substantially all dividends paid by the Fund will not be subject to
Federal, New York State and New York City personal income taxes. To the
extent that investors are obligated to pay state or local taxes outside of
New York State and New York City, dividends earned by an investment in the
Fund may represent taxable income. Dividends derived from Taxable
Investments, together with distributions from any net realized short-
Page 15
term securities gains and all or a portion of any gain realized from the
sale or other disposition of certain market discount bonds, are taxable as
ordinary income whether received in cash or reinvested in Fund shares, if the
beneficial holder of Fund shares is a citizen or resident of the United
States. No dividend paid by the Fund will qualify for the dividends received
deduction allowable to certain U.S. corporations. Distributions from net
realized long-term securities gains of the Fund generally are taxable as
long-term capital gains for Federal income tax purposes if the beneficial
holder of Fund shares is a citizen or resident of the United States,
regardless of how long shareholders have held their Fund shares and whether
such distributions are received in cash or reinvested in Fund shares. The
Code provides that the net capital gain of an individual generally will not
be subject to Federal income tax at a rate in excess of 28%. Under the Code,
interest on indebtedness incurred or continued to purchase or carry Fund
shares which is deemed to relate to exempt-interest dividends is not
deductible.
Although all or a substantial portion of the dividends paid by the
Fund may be excluded by the beneficial holders of Fund shares from their
gross income for Federal income tax purposes, the Fund may purchase specified
private activity bonds, the interest from which may be (i) a preference item
for purposes of the alternative minimum tax, (ii) a component of the
"adjusted current earnings" preference item for purposes of the corporate
alternative minimum tax as well as a component in computing the corporate
environmental tax or (iii) a factor in determining the extent to which the
Social Security benefits of a beneficial holder of Fund shares are taxable.
If the Fund purchases such securities, the portion of the Fund's dividends
related thereto will not necessarily be tax exempt to a beneficial holder of
Fund shares who is subject to the alternative minimum tax and/or tax on
Social Security benefits and may cause a beneficial holder of Fund shares to
be subject to such taxes.
Notice as to the tax status of an investor's dividends and
distributions will be mailed to such investor annually. Each investor also
will receive periodic summaries of its account which will include information
as to dividends and distributions from securities gains, if any, paid during
the year. These statements set forth the dollar amount of income exempt from
Federal tax and the dollar amount, if any, subject to Federal tax. These
dollar amounts will vary depending on the size and length of time of the
investor's investment in the Fund. If the Fund pays dividends derived from
taxable income, it intends to designate as taxable the same percentage of the
day's dividend as the actual taxable income earned on that day bears to total
income earned on that day. Thus, the percentage of the dividend designated as
taxable, if any, may vary from day to day.
Federal regulations generally require the Fund to withhold ("backup
withholding") and remit to the U.S. Treasury 31% of taxable dividends and
distributions from net realized securities gains paid to a shareholder if
such shareholder fails to certify either that the TIN furnished in connection
with opening an account is correct or that such shareholder has not received
notice from the IRS of being subject to backup withholding as a result of a
failure to properly report taxable dividend or interest income on a Federal
income tax return. Furthermore, the IRS may notify the Fund to institute
backup withholding if the IRS determines a shareholder's TIN is incorrect or
if a shareholder has failed to properly report taxable dividend and interest
income on a Federal income tax return.
A TIN is either the Social Security number or employer identification
number of the record owner of the account. Any tax withheld as a result of
backup withholding does not constitute an additional tax imposed on the
record owner of the account, and may be claimed as a credit on the record
owner's Federal income tax return.
Management of the Fund believes that the Fund has qualified for the
fiscal year ended July 31, 1994 as a "regulated investment company" under the
Code. The Fund intends to continue to so qualify if such qualification is in
the best interests of its shareholders. Such qualification relieves the Fund
of any liability for Federal income tax to the extent its earnings are
distributed in accordance with applicable provisions of the Code. The Fund is
subject to a non-deductible 4% excise tax, measured with
Page 16
respect to certain undistributed amounts of taxable investment income and
capital gains.
Each investor should consult its tax adviser regarding specific
questions as to Federal, state or local taxes.
GENERAL INFORMATION
The Fund was organized as an unincorporated business trust under the
laws of the Commonwealth of Massachusetts pursuant to an Agreement and
Declaration of Trust (the "Trust Agreement") dated September 12, 1990, and
commenced operations on November 4, 1991. The Fund is authorized to issue an
unlimited number of shares of beneficial interest, par value $.001 per share.
The Fund's shares are classified into two classes. Each share has one vote
and shareholders will vote in the aggregate and not by class except as
otherwise required by law or with respect to any matter which affects only
one class. Holders of Class B shares only, however, will be entitled to vote
on matters submitted to shareholders pertaining to the Service Plan.
Investors have agreed to vote Fund shares for which they are the record
owners according to voting instructions received from the beneficial holder
of such shares.
Under Massachusetts law, shareholders could, under certain
circumstances, be held liable for the obligations of the Fund. However, the
Trust Agreement disclaims shareholder liability for acts or obligations of
the Fund and requires that notice of such disclaimer be given in each
agreement, obligation or instrument entered into or executed by the Fund or a
Trustee. The Trust Agreement provides for indemnification from the Fund's
property for all losses and expenses of any shareholder held liable for the
obligations of the Fund. Thus, the risk of a shareholder's incurring
financial loss on account of shareholder liability is limited to
circumstances in which the Fund itself would be unable to meet its
obligations, a possibility which management believes is remote. Upon payment
of any liability incurred by the Fund, the shareholder paying such liability
will be entitled to reimbursement from the general assets of the Fund. The
Trustees intend to conduct the operations of the Fund in such a way so as to a
void, as far as possible, ultimate liability of the shareholders for
liabilities of the Fund. As described under "Management of the Fund" in the
Statement of Additional Information, the Fund ordinarily will not hold
shareholder meetings; however, shareholders under certain circumstances may
have the right to call a meeting of shareholders for the purpose of voting to
remove Trustees.
The Transfer Agent maintains a record of each investor's ownership
and sends confirmations and statements of account.
Investor inquiries may be made by writing to the Fund at 144 Glenn
Curtiss Boulevard, Uniondale, New York 11556-0144, or, in the case of
institutional investors, by calling in New York State 1-718-895-1650; outside
New York State call toll free 1-800-346-3621. Individuals or entities for
whom institutions may purchase or redeem Fund shares should call toll free
1-800-554-4611.
The Glass-Steagall Act and other applicable laws prohibit Federally
chartered or supervised banks from engaging in certain aspects of the
business of issuing, underwriting, selling and/or distributing securities.
Accordingly, banks will perform only administrative and shareholder servicing
functions. While the matter is not free from doubt, the Fund's Board of
Trustees believes that such laws should not preclude a bank from acting on
behalf of clients as contemplated by this Prospectus. However, judicial or
administrative decisions or interpretations of such laws, as well as changes
in either Federal or state statutes or regulations relating to the
permissible activities of banks and their subsidiaries or affiliates, could
prevent a bank from continuing to perform all or part of the activities
contemplated by this Prospectus. If a bank were prohibited from so acting,
its shareholder clients would be permitted to remain Fund shareholders and
alternative means for continuing the servicing of such shareholders would be
sought. In such event, changes in the operation of the Fund might occur and
shareholders serviced by such bank might no longer be able to avail
themselves of any automatic investment or other services then being provided
by the bank. The Fund does not expect that shareholders would suffer any
Page 17
adverse financial consequences as a result of any of these occurrences.
No person has been authorized to give any information or to make any
representations other than those contained in this Prospectus and in the
Fund's official sales literature in connection with the offer of the Fund's
shares, and, if given or made, such other information or representations must
not be relied upon as having been authorized by the Fund. This Prospectus
does not constitute an offer in any State in which, or to any person to whom,
such offering may not lawfully be made.
Page 18
[This Page Intentionally Left Blank]
Page 19
PROSPECTUS
(LION LOGO)
DREYFUS
NEW YORK
MUNICIPAL
CASH
MANAGEMENT
copyright logo 1994, Premier Mutual Fund Services, Inc., Distributor
DREYFUS NEW YORK MUNICIPAL CASH MANAGEMENT
CLASS A AND CLASS B SHARES
PART B
(STATEMENT OF ADDITIONAL INFORMATION)
NOVEMBER 28, 1994
This Statement of Additional Information, which is not a prospectus,
supplements and should be read in conjunction with the current Prospectus
of Dreyfus New York Municipal Cash Management (the "Fund"), dated November
28, 1994, as it may be revised from time to time. To obtain a copy of the
Fund's Prospectus, please write to the Fund at 144 Glenn Curtiss Boulevard,
Uniondale, New York 11556-0144, or, in the case of institutional investors,
call the following numbers:
Outside New York State -- Call Toll Free 1-800-346-3621
In New York State -- Call 1-718-895-1650
Individuals or entities for whom institutions may purchase or redeem
Fund shares may write to the Fund at the above address or call toll free 1-
800-554-4611 to obtain a copy of the Fund's Prospectus.
The Dreyfus Corporation (the "Manager") serves as the Fund's
investment adviser.
Premier Mutual Fund Services, Inc. (the "Distributor") is the
distributor of the Fund's shares.
TABLE OF CONTENTS
Page
Investment Objective and Management Policies. . . . . . . . . . . . B-2
Management of the Fund. . . . . . . . . . . . . . . . . . . . . . . B-7
Management Agreement. . . . . . . . . . . . . . . . . . . . . . . . B-10
Purchase of Fund Shares . . . . . . . . . . . . . . . . . . . . . . B-12
Service Plan (Class B Only) . . . . . . . . . . . . . . . . . . . . B-12
Shareholder Services Plan (Class A Only). . . . . . . . . . . . . . B-13
Redemption of Fund Shares . . . . . . . . . . . . . . . . . . . . . B-14
Determination of Net Asset Value. . . . . . . . . . . . . . . . . . B-15
Portfolio Transactions. . . . . . . . . . . . . . . . . . . . . . . B-15
Investor Services . . . . . . . . . . . . . . . . . . . . . . . . . B-16
Dividends, Distributions and Taxes. . . . . . . . . . . . . . . . . B-17
Yield Information . . . . . . . . . . . . . . . . . . . . . . . . . B-17
Information About the Fund. . . . . . . . . . . . . . . . . . . . . B-18
Custodian, Transfer and Dividend Disbursing Agent,
Counsel and Independent Auditors. . . . . . . . . . . . . . . . . B-19
Appendix A. . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-20
Appendix B. . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-34
Financial Statements B-38
Report of Independent Auditors. . . . . . . . . . . . . . . . . . . B-45
INVESTMENT OBJECTIVE AND MANAGEMENT POLICIES
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled "Description
of the Fund."
The average distribution of investments (at value) in Municipal
Obligations by ratings for the fiscal year ended July 31, 1994, computed on
a monthly basis, was as follows:
Fitch Moody's Standard
Investors Investors & Poor's
Service, Inc. Service, Inc. Corporation Percentage
("Fitch") or ("Moody's") or ("S&P") of Value
____________ _____________ __________ _________
F-1+/F-1 VMIG 1/MIG 1, SP-1+/SP-1,
P-1 A-1+/A-1 87.5%
F-2 VMIG 2/MIG 2, SP-2, A-2
P-2 0.2
AAA/AA Aaa/Aa AAA/AA 3.9
Not Rated Not Rated Not Rated 8.4
100.0%
Municipal Obligations. The term "Municipal Obligations" generally
includes debt obligations issued to obtain funds for various public
purposes, including the construction of a wide range of public facilities
such as airports, bridges, highways, housing, hospitals, mass
transportation, schools, streets and water and sewer works. Other public
purposes for which Municipal Obligations may be issued include refunding
outstanding obligations, obtaining funds for general operating expenses and
lending such funds to other public institutions and facilities. In
addition, certain types of industrial development bonds are issued by or on
behalf of public authorities to obtain funds to provide for the
construction, equipment, repair or improvement of privately operated
housing facilities, sports facilities, convention or trade show facilities,
airport, mass transit, industrial, port or parking facilities, air or water
pollution control facilities and certain local facilities for water supply,
gas, electricity, or sewage or solid waste disposal; the interest paid on
such obligations may be exempt from Federal income tax, although current
tax laws place substantial limitations on the size of such issues. Such
obligations are considered to be Municipal Obligations if the interest paid
thereon qualifies as exempt from Federal income tax in the opinion of bond
counsel to the issuer. There are, of course, variations in the security of
Municipal Obligations, both within a particular classification and between
classifications.
Floating and variable rate demand notes and bonds are tax exempt
obligations ordinarily having stated maturities in excess of 13 months, but
which permit the holder to demand payment of principal at any time, or at
specified intervals not exceeding 13 months, in each case upon not more
than 30 days' notice. The issuer of such obligations ordinarily has a
corresponding right, after a given period, to prepay in its discretion the
outstanding principal amount of the obligations plus accrued interest upon
a specified number of days' notice to the holders thereof. The interest
rate on a floating rate demand obligation is based on a known lending rate,
such as a bank's prime rate, and is adjusted automatically each time such
rate is adjusted. The interest rate on a variable rate demand obligation
is adjusted automatically at specified intervals.
The yields on Municipal Obligations are dependent on a variety of
factors, including general economic and monetary conditions, money market
factors, conditions in the Municipal Obligations market, size of a
particular offering, maturity of the obligation, and rating of the issue.
The imposition of the Fund's management fee, as well as other operating
expenses, will have the effect of reducing the yield to investors.
Municipal lease obligations or installment purchase contract
obligations (collectively, "lease obligations") have special risks not
ordinarily associated with Municipal Obligations. Although lease
obligations do not constitute general obligations of the municipality for
which the municipality's taxing power is pledged, a lease obligation
ordinarily is backed by the municipality's covenant to budget for,
appropriate and make the payments due under the lease obligation. However,
certain lease obligations contain "non-appropriation" clauses which provide
that the municipality has no obligation to make lease or installment
purchase payments in future years unless money is appropriated for such
purpose on a yearly basis. In addition to the "non-appropriation" risk,
these securities represent a relatively new type of financing that has not
yet developed the depth of marketability associated with more conventional
bonds. Although "non-appropriation" lease obligations are secured by the
leased property, disposition of the property in the event of foreclosure
might prove difficult. The Fund will seek to minimize these risks by
investing only in those lease obligations that (1) are rated in one of the
two highest rating categories for debt obligations by at least two
nationally recognized statistical rating organizations (or one rating
organization if the lease obligation was rated by only one such
organization) or (2) if unrated, are purchased principally from the issuer
or domestic banks or other responsible third parties, in each case only if
the seller shall have entered into an agreement with the Fund providing
that the seller or other responsible third party will either remarket or
repurchase the lease obligation within a short period after demand by the
Fund. The staff of the Securities and Exchange Commission currently
considers certain lease obligations to be illiquid. Accordingly, not more
than 10% of the value of the Fund's net assets will be invested in lease
obligations that are illiquid and in other illiquid securities. See
"Investment Restriction No. 10" below.
Ratings of Municipal Obligations. If, subsequent to its purchase by
the Fund, (a) an issue of rated Municipal Obligations ceases to be rated in
the highest rating category by at least two rating organizations (or one
rating organization if the instrument was rated by only one such
organization) or the Fund's Board determines that it is no longer of
comparable quality or (b) the Manager becomes aware that any portfolio
security not so highly rated or any unrated security has been given a
rating by any rating organization below the rating organization's second
highest rating category, the Fund's Board will reassess promptly whether
such security presents minimal credit risk and will cause the Fund to take
such action as it determines is in the best interest of the Fund and its
shareholders; provided that the reassessment required by clause (b) is not
required if the portfolio security is disposed of or matures within five
business days of the Manager becoming aware of the new rating and the
Fund's Board is subsequently notified of the Manager's actions.
To the extent that the ratings given by Moody's, S&P or Fitch may
change as a result of changes in such organizations or their rating
systems, the Fund will attempt to use comparable ratings as standards for
its investments in accordance with the investment policies contained in the
Fund's Prospectus and this Statement of Additional Information. The
ratings of Moody's, S&P and Fitch represent their opinions as to the
quality of the Municipal Obligations which they undertake to rate. It
should be emphasized, however, that ratings are relative and subjective and
are not absolute standards of quality. Although these ratings may be an
initial criterion for selection of portfolio investments, the Manager also
will evaluate these securities and the creditworthiness of the issuers of
such securities based upon financial and other available information.
Taxable Investments. Securities issued or guaranteed by the U.S.
Government or its agencies or instrumentalities include U.S. Treasury
securities, which differ only in their interest rates, maturities and times
of issuance. Treasury Bills have initial maturities of one year or less;
Treasury Notes have initial maturities of one to ten years; and Treasury
Bonds generally have initial maturities of greater than ten years. Some
obligations issued or guaranteed by U.S. Government agencies and
instrumentalities, for example, Government National Mortgage Association
pass-through certificates, are supported by the full faith and credit of
the U.S. Treasury; others, such as those of the Federal Home Loan Banks, by
the right of the issuer to borrow from the U.S. Treasury; others, such as
those issued by the Federal National Mortgage Association, by discretionary
authority of the U.S. Government to purchase certain obligations of the
agency or instrumentality; and others, such as those issued by the Student
Loan Marketing Association, only by the credit of the agency or
instrumentality. These securities bear fixed, floating or variable rates
of interest. Interest may fluctuate based on generally recognized
reference rates or the relationship of rates. While the U.S. Government
provides financial support to such U.S. Government-sponsored agencies or
instrumentalities, no assurance can be given that it will always do so,
since it is not so obligated by law. The Fund will invest in such
securities only when it is satisfied that the credit risk with respect to
the issuer is minimal.
Commercial paper consists of short-term, unsecured promissory notes
issued to finance short-term credit needs.
Certificates of deposit are negotiable certificates representing the
obligation of a bank to repay funds deposited with it for a specified
period of time.
Time deposits are non-negotiable deposits maintained in a banking
institution for a specified period of time at a stated interest rate.
Investments in time deposits generally are limited to London branches of
domestic banks that have total assets in excess of one billion dollars.
Time deposits which may be held by the Fund will not benefit from insurance
from the Bank Insurance Fund or the Savings Association Insurance Fund
administered by the Federal Deposit Insurance Corporation.
Bankers' acceptances are credit instruments evidencing the obligation
of a bank to pay a draft drawn on it by a customer. These instruments
reflect the obligation both of the bank and of the drawer to pay the face
amount of the instrument upon maturity. Other short-term bank obligations
may include uninsured, direct obligations bearing fixed, floating or
variable interest rates.
Repurchase agreements involve the acquisition by the Fund of an
underlying debt instrument, subject to an obligation of the seller to
repurchase, and the Fund to resell, the instrument at a fixed price usually
not more than one week after its purchase. The Fund's custodian will have
custody of, and will hold in a segregated account, securities acquired by
the Fund under a repurchase agreement. Repurchase agreements are
considered by the staff of the Securities and Exchange Commission to be
loans by the Fund. In an attempt to reduce the risk of incurring a loss on
a repurchase agreement, the Fund will enter into repurchase agreements only
with domestic banks with total assets in excess of one billion dollars or
primary government securities dealers reporting to the Federal Reserve Bank
of New York, with respect to securities of the type in which the Fund may
invest, and will require that additional securities be deposited with it if
the value of the securities purchased should decrease below resale price.
The Manager will monitor on an ongoing basis the value of the collateral to
assure that it always equals or exceeds the repurchase price. Certain
costs may be incurred by the Fund in connection with the sale of the
securities if the seller does not repurchase them in accordance with the
repurchase agreement. In addition, if bankruptcy proceedings are commenced
with respect to the seller of the securities, realization on the securities
by the Fund may be delayed or limited. The Fund will consider on an
ongoing basis the creditworthiness of the institutions with which it enters
into repurchase agreements.
Risk Factors - Investing In New York Municipal Obligations. Each
investor should consider carefully the special risks inherent in the Fund's
investment in New York Municipal Obligations. These risks result from the
financial condition of New York State and certain of its public bodies and
municipalities, including New York City. Beginning in early 1975, New York
State, New York City and other entities faced serious financial
difficulties which jeopardized the credit standing and impaired the
borrowing abilities of such entities and contributed to high interest rates
on, and lower market prices for, debt obligations issued by them. A
recurrence of such financial difficulties or a failure of certain financial
recovery programs could result in defaults or declines in the market values
of various New York Municipal Obligations in which the Fund may invest. If
there should be a default or other financial crisis relating to New York
State, New York City, a State or City agency, or a State municipality, the
market value and marketability of outstanding New York Municipal
Obligations in the Fund's portfolio and the interest income to the Fund
could be adversely affected. Moreover, the significant slowdown in the New
York and regional economies in the early 1990s added substantial
uncertainty to estimates of the State's tax revenues, which caused, in
part, the State to overestimate its General Fund tax receipts in the 1992
fiscal year by $575 million. The 1992 fiscal year was the fourth
consecutive year in which the State incurred a cash-basis operating deficit
in the General Fund and issued deficit notes. The State's 1993 fiscal
year, however, was characterized by national and regional economies that
performed better than projected. After reflecting a 1993 year-end deposit
to the refund reserve account of $671 million, reported 1993 General Fund
receipts were $45 million higher than originally projected in April 1992.
If not for that year-end transaction, General Fund receipts would have been
$716 million higher than originally projected. There can be no assurance
that New York will not face substantial potential budget gaps in future
years. In 1990, S&P and Moody's lowered their ratings of the State's
general obligation debt from AA to A and from A1 to A, respectively. In
addition, S&P and Moody's lowered their ratings in 1990 on New York State's
short-term notes from SP-1+ to SP-1 and from MIG-1 to MIG-2, respectively.
In January 1992, Moody's lowered from A to Baa1 its ratings of certain
appropriation-backed debt of New York State and its agencies and S&P
lowered from A to A- its ratings of New York State general obligation
bonds. S&P also lowered its ratings of various agency debt, State moral
obligations, contractual obligations, lease purchase obligations and State
guarantees. In February 1991, Moody's lowered its rating of New York
City's general obligation bonds from A to Baa1. The rating changes reflect
the rating agencies' concerns about the financial condition of New York
State and City, the heavy debt load of the State and City, and economic
uncertainties in the region. Investors should review Appendix A which more
fully sets forth these and other risk factors.
Investment Restrictions. The Fund has adopted investment restrictions
numbered 1 through 9 as fundamental policies. These restrictions cannot be
changed without approval by the holders of a majority (as defined in the
Investment Company Act of 1940 (the "Act")) of the Fund's outstanding
voting shares. Investment restriction number 10 is not a fundamental
policy and may be changed by vote of a majority of the Fund's Trustees at
any time. The Fund may not:
1. Purchase securities other than Municipal Obligations and Taxable
Investments as those terms are defined above and in the Fund's Prospectus.
2. Borrow money, except from banks for temporary or emergency (not
leveraging) purposes in an amount up to 15% of the value of the Fund's
total assets (including the amount borrowed) based on the lesser of cost or
market, less liabilities (not including the amount borrowed) at the time
the borrowing is made. While borrowings exceed 5% of the value of the
Fund's total assets, the Fund will not make any additional investments.
3. Pledge, hypothecate, mortgage or otherwise encumber its assets,
except to secure borrowings for temporary or emergency purposes.
4. Sell securities short or purchase securities on margin.
5. Underwrite the securities of other issuers, except that the Fund
may bid separately or as part of a group for the purchase of Municipal
Obligations directly from an issuer for its own portfolio to take advantage
of the lower purchase price available.
6. Purchase or sell real estate, real estate investment trust
securities, commodities or commodity contracts, or oil and gas interests,
but this shall not prevent the Fund from investing in Municipal Obligations
secured by real estate or interests therein.
7. Make loans to others except through the purchase of qualified
debt obligations and the entry into repurchase agreements referred to above
and in the Fund's Prospectus.
8. Invest more than 25% of its total assets in the securities of
issuers in any single industry; provided that there shall be no such
limitation on the purchase of Municipal Obligations and, for temporary
defensive purposes, obligations issued or guaranteed by the U.S.
Government, its agencies or instrumentalities.
9. Invest in securities of other investment companies, except as
they may be acquired as part of a merger, consolidation or acquisition of
assets.
10. Enter into repurchase agreements providing for settlement in
more than seven days after notice or purchase securities which are illiquid
if, in the aggregate, more than 10% of the value of the Fund's net assets
would be so invested.
Notwithstanding Investment Restriction Nos. 1, 3 and 6, the Fund
reserves the right to enter into interest rate futures contracts, and
municipal bond index futures contracts, and any options that may be offered
in respect thereof, subject to the restrictions then in effect of the
Securities and Exchange Commission and the Commodity Futures Trading
Commission and to the receipt or taking, as the case may be, of appropriate
consents, approvals and other actions from or by those regulatory bodies.
In any event, no such contracts or options will be entered into until a
general description of the terms thereof are set forth in a subsequent
prospectus and statement of additional information, the Registration
Statement with respect to which has been filed with the Securities and
Exchange Commission and has become effective.
For purposes of Investment Restriction No. 8, industrial development
bonds, where the payment of principal and interest is the ultimate
responsibility of companies within the same industry, are grouped together
as an "industry." If a percentage restriction is adhered to at the time of
investment, a later increase or decrease in percentage resulting from a
change in values or assets will not constitute a violation of such
restriction.
The Fund may make commitments more restrictive than the restrictions
listed above so as to permit the sale of Fund shares in certain states.
Should the Fund determine that a commitment is no longer in the best
interest of the Fund and its shareholders, the Fund reserves the right to
revoke the commitment by terminating the sale of Fund shares in the state
involved.
MANAGEMENT OF THE FUND
Trustees and officers of the Fund, together with information as to
their principal business occupations during at least the last five years,
are shown below. Each Trustee who is deemed to be an "interested person"
of the Fund, as defined in the Act, is indicated by an asterisk.
Trustees of the Fund
*DAVID W. BURKE, Trustee. Consultant to the Manager since August 1994.
From October 1990 to August 1994, Mr. Burke was Vice President and
Chief Administrative Officer of the Manager. During the period 1977
to 1990, Mr. Burke was involved in the management of national
television news, as Vice President and Executive Vice President of ABC
News, and subsequently as President of CBS News. His address is 200
Park Avenue, New York, New York 10166.
ISABEL P. DUNST, Trustee. Partner in the law firm of Hogan & Hartson since
1990. From 1986 to 1990, Deputy General Counsel of the United States
Department of Health and Human Services. She is also a Trustee of the
Clients Security Fund of the District of Columbia Bar and a Trustee of
Temple Sinai. Her address is c/o Hogan & Hartson, Columbia Square,
555 Thirteenth Street, N.W., Washington, D.C. 20004-1109.
LYLE E. GRAMLEY, Trustee. Consulting economist since June 1992 and Senior
Staff Vice President and Chief Economist of Mortgage Bankers
Association of America from 1985 to May 1992. Since February 1993, a
director of CWM Mortgage Holdings, Inc. From 1980 to 1985, member of
the Board of Governors of the Federal Reserve System. His address is
12901 Three Sisters Road, Potomac, Maryland 20854.
WARREN B. RUDMAN, Trustee. Since January 1993, Partner in the law firm
Paul, Weiss, Rifkind, Wharton & Garrison. From January 1981 to
January 1993, Mr. Rudman served as a United States Senator from the
State of New Hampshire. Also, since January 1993, Mr. Rudman has
served as Vice Chairman of the Federal Reserve Bank of Boston and as a
director of Chubb Corporation and Raytheon Company. He has served as
Vice Chairman of the President's Foreign Intelligence Advisory Board
since January 1993. Since 1988, Mr. Rudman has served as a trustee of
Boston College and since 1986 as a member of the Senior Advisory Board
of the Institute of Politics of the Kennedy School of Government at
Harvard University. His address is 1615 L Street, N.W., Suite 1300,
Washington D.C. 20036.
Each of the noninterested Trustees is also a trustee of Dreyfus Cash
Management, Dreyfus Government Cash Management, Dreyfus Municipal Cash
Management Plus, Dreyfus Tax Exempt Cash Management, Dreyfus Treasury Cash
Management and Dreyfus Treasury Prime Cash Management and a director of
Dreyfus Cash Management Plus, Inc. Mr. Rudman is also a trustee of Dreyfus
BASIC U.S. Government Money Market Fund, Dreyfus California Intermediate
Municipal Bond Fund, Dreyfus Connecticut Intermediate Municipal Bond Fund,
Dreyfus Massachusetts Intermediate Municipal Bond Fund, Dreyfus New Jersey
Intermediate Municipal Bond Fund, Dreyfus Pennsylvania Intermediate
Municipal Bond Fund, Dreyfus Strategic Income and Dreyfus Strategic
Investing, and a director of Dreyfus BASIC Money Market Fund, Inc. and
Dreyfus Strategic Governments Income, Inc.
For so long as the Fund's plans described in the sections captioned
"Service Plan" and "Shareholder Services Plan" remain in effect, the
Trustees of the Fund who are not "interested persons" of the Fund, as
defined in the Act, will be selected and nominated by the Trustees who are
not "interested persons" of the Fund.
The Fund does not pay any remuneration to its officers and Trustees
other than fees and expenses to Trustees who are not officers, directors,
employees or holders of 5% or more of the outstanding voting securities of
the Manager, which totalled $1,918 for the fiscal year ended July 31, 1994
for all such Trustees as a group.
Each Trustee was elected at a meeting of shareholders held on August
5, 1994. No further meetings of shareholders will be held for the purpose
of electing Trustees unless and until such time as less than a majority of
the Trustees holding office have been elected by shareholders, at which
time the Trustees then in office will call a shareholders' meeting for the
election of Trustees. Under the Act, shareholders of record of not less
than two-thirds of the outstanding shares of the Fund may remove a Trustee
through a declaration in writing or by vote cast in person or by proxy at a
meeting called for that purpose. Under the Fund's Agreement and
Declaration of Trust, the Trustees are required to call a meeting of
shareholders for the purpose of voting upon the question of removal of any
such Trustee when requested in writing to do so by the shareholders of
record of not less than 10% of the Fund's outstanding shares.
Officers of the Fund
MARIE E. CONNOLLY, President and Treasurer. President and Chief Operating
Officer and a Director of the Distributor and an officer of other
investment companies advised or administered by the Manager. From
December 1991 to July 1994, she was President and Chief Compliance
Officer of Funds Distributor, Inc., a wholly-owned subsidiary of The
Boston Company, Inc. Prior to December 1991, she served as Vice
President and Controller, and later as Senior Vice President, of The
Boston Company Advisors, Inc.
JOHN E. PELLETIER, Secretary. Senior Vice President - General Counsel of
the Distributor and an officer of other investment companies advised
or administered by the Manager. From February 1992 to July 1994, he
served as Counsel for The Boston Company Advisors, Inc. From August
1990 to February 1992, he was employed as an Associate at Ropes &
Gray, and prior to August 1990, he was employed as an Associate at
Sidley & Austin.
JOSEPH F. TOWER, III, Assistant Treasurer. Treasurer and Chief Financial
Officer of the Distributor and an officer of other investment
companies advised or administered by the Manager. From July 1988 to
August 1994, he was employed by The Boston Company, Inc. where he held
various management positions in the Corporate Finance and Treasury
areas.
FREDERICK C. DEY, Assistant Treasurer. Senior Vice President of the
Distributor and an officer of other investment companies advised or
administered by the Manager. From 1988 to August 1994, he was manager
of the High Performance Fabric Division of Springs Industries Inc.
ERIC B. FISCHMAN, Assistant Secretary. Associate General Counsel of the
Distributor and an officer of other investment companies advised or
administered by the Manager. From September 1992 to August 1994, he
was an attorney with the Board of Governors of the Federal Reserve
System.
RUTH D. LEIBERT, Assistant Secretary. Assistant Vice President of the
Distributor and an officer of other investment companies advised or
administered by the Manager. From March 1992 to July 1994, she was a
Compliance Officer for The Managers Funds, registered investment
companies. From March 1990 until September 1991, she was Development
Director of The Rockland Center for the Arts and, prior thereto, was
employed as a Research Assistant for the Bureau of National Affairs.
The address of each officer of the Fund is 200 Park Avenue, New York,
New York 10166.
Trustees and officers of the Fund, as a group, owned less than 1% of
the Fund's shares of beneficial interest outstanding on September 16, 1994.
The following shareholders are known by the Fund to own of record 5%
or more of the Fund's Class B shares of beneficial interest outstanding on
September 16, 1994: Republic National Bank of New York, 176 Broadway,
Mezzanine Level, New York, NY 10038, account number 677-0616430237
(67.10%); Republic National Bank of New York, 176 Broadway, Mezzanine
Level, New York, NY 10038 account number 0616430344 (22.50%); Gunther &
Company, Church Street Station, P.O. Box 395, New York, NY 10008-0395
(9.00%).
MANAGEMENT AGREEMENT
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled "Management
of the Fund."
The Manager provides management services pursuant to the Management
Agreement (the "Agreement") dated August 24, 1994, with the Fund, which is
subject to annual approval by (i) the Fund's Board of Trustees or (ii) vote
of a majority (as defined in the Act) of the outstanding voting securities
of the Fund, provided that in either event the continuance also is approved
by a majority of the Trustees who are not "interested persons" (as defined
in the Act) of the Fund or the Manager, by vote cast in person at a meeting
called for the purpose of voting on such approval. The Board of Trustees,
including a majority of the Trustees who are not "interested persons" of
any party to the Agreement, approved the Agreement at a meeting held on May
24, 1994. The Fund's shareholders approved the Agreement at a shareholders
meeting held on August 5, 1994. The Agreement is terminable without
penalty, on 60 days' notice, by the Fund's Board of Trustees or by vote of
the holders of a majority of the Fund's shares, or, on not less than 90
days' notice, by the Manager. The Agreement will terminate automatically
in the event of its assignment (as defined in the Act).
The following persons are officers and/or directors of the Manager:
Howard Stein, Chairman of the Board and Chief Executive Officer; Julian M.
Smerling, Vice Chairman of the Board of Directors; Joseph S. DiMartino,
President and a director; W. Keith Smith, Chief Operating Officer and a
director; Lawrence S. Kash, Vice Chairman--Distribution; Daniel C. Maclean
III, Vice President and General Counsel; Diane Coffey, Vice President--
Corporate Communications; Jeffrey N. Nachman, Vice President--Fund
Administration; Mark N. Jacobs, Vice President--Fund Legal and Compliance;
Henry D. Gottmann, Vice President--Retail; Elie M. Genadry, Vice President-
- -Wholesale; Jay R. DeMartine, Vice President--Marketing; Paul H. Snyder,
Vice President and Chief Financial Officer; Robert F. Dubuss, Vice
President; Peter A. Santoriello, Vice President; Kirk V. Stumpp, Vice
President--New Product Development; Philip L. Toia, Vice Chairman--
Operations and Administration; Katherine C. Wickham, Vice President--Human
Resources; Maurice Bendrihem, Controller; and Mandell L. Berman, Frank
Cahouet, Alvin S. Friedman, Lawrence M. Greene, Abigail Q. McCarthy and
David B. Truman, directors.
The Manager manages the Fund's portfolio of investments in accordance
with the stated policies of the Fund, subject to the approval of the Fund's
Board of Trustees. The Manager is responsible for investment decisions,
and provides the Fund with portfolio managers who are authorized by the
Trustees to execute purchases and sales of securities. The Fund's
Portfolio Managers are A. Paul Disdier, Karen M. Hand, Stephen C. Kris,
Richard J. Moynihan, Jill C. Shaffro, L. Lawrence Troutman, Samuel J.
Weinstock and Monica S. Wieboldt. The Manager also maintains a research
department with a professional staff of securities analysts who provide
research services for the Fund as well as for other funds advised by the
Manager. All purchases and sales are reported for the Trustees' review at
the meeting subsequent to such transactions.
The Manager maintains office facilities on behalf of the Fund, and
furnishes statistical and research data, clerical help, accounting, data
processing, bookkeeping and internal auditing and certain other required
services. The Manager also may make such advertising and promotional
expenditures, using its own resources, as it from time to time deems
appropriate.
As compensation for its services, the Fund has agreed to pay the
Manager a monthly fee at the annual rate of .20 of 1% of the value of the
Fund's average daily net assets. All fees and expenses are accrued daily
and deducted before the declaration of dividends to shareholders.
For the period November 4, 1991 (commencement of operations) through July
31, 1992, no management fee was paid by the Fund pursuant to an undertaking
by the Manager. The fee payable for the fiscal years ended July 31, 1993
and 1994 amounted to $202,107 and $261,339, respectively, which amounts
were reduced to $21,427 and $192,934, respectively.
Unless the Manager gives the Fund's investors at least 90 days' notice
to the contrary, the Manager, and not the Fund, will be liable for Fund
expenses (exclusive of taxes, brokerage, interest on borrowings and (with
the prior written consent of the necessary state securities commissions)
extraordinary expenses) other than the following expenses, which will be
borne by the Fund: (i) the management fee payable by the Fund monthly at
the annual rate of .20 of 1% of the Fund's average daily net assets and
(ii) as to Class B shares only, payments made pursuant to the Fund's
Service Plan at the annual rate of .25 of 1% of the value of the average
daily net assets of Class B. See "Service Plan."
In addition, the Agreement provides that if in any fiscal year the
aggregate expenses of the Fund, exclusive of taxes, brokerage, interest on
borrowings and (with the prior written consent of the necessary state
securities commissions) extraordinary expenses, but including the
management fee, exceed the expense limitation of any state having
jurisdiction over the Fund, the Fund may deduct from the payment to be made
to the Manager under the Agreement, or the Manager will bear, such excess
expense to the extent required by state law. Such deduction or payment, if
any, will be estimated daily, and reconciled and effected or paid, as the
case may be, on a monthly basis.
The aggregate of the fees payable to the Manager is not subject to
reduction as the value of the Fund's net assets increases.
PURCHASE OF FUND SHARES
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled "How to Buy
Fund Shares."
The Distributor. The Distributor serves as the Fund's distributor
pursuant to an agreement which is renewable annually. The Distributor also
acts as distributor for the other funds in the Dreyfus Family of Funds and
for certain other investment companies.
Using Federal Funds. The Shareholder Services Group, Inc., the Fund's
transfer and dividend disbursing agent (the "Transfer Agent"), or the Fund
may attempt to notify the investor upon receipt of checks drawn on banks
that are not members of the Federal Reserve System as to the possible delay
in conversion into Federal Funds and may attempt to arrange for a better
means of transmitting the money. If the investor is a customer of a
securities dealer, bank or other financial institution and his order to
purchase Fund shares is paid for other than in Federal Funds, the
securities dealer, bank or other financial institution, acting on behalf of
its customer, will complete the conversion into, or itself advance, Federal
Funds generally on the business day following receipt of the customer
order. The order is effective only when so converted and received by the
Transfer Agent. An order for the purchase of Fund shares placed by an
investor with a sufficient Federal Funds or cash balance in his brokerage
account with a securities dealer, bank or other financial institution will
become effective on the day that the order, including Federal Funds, is
received by the Transfer Agent. In some states, banks or other financial
institutions effecting transactions in Fund shares may be required to
register as dealers pursuant to state law.
SERVICE PLAN
(CLASS B ONLY)
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled "Service
Plan."
Rule 12b-1 (the "Rule") adopted by the Securities and Exchange
Commission under the Act provides, among other things, that an investment
company may bear expenses of distributing its shares only pursuant to a
plan adopted in accordance with the Rule. The Fund's shareholders and
Board of Trustees have approved such a Plan (the "Service Plan") with
respect to the Fund's Class B shares. Pursuant to the Service Plan, the
Fund (i) reimburses the Distributor for distributing the Fund's Class B
shares and (ii) pays the Manager, Dreyfus Service Corporation, a wholly-
owned subsidiary of the Manager, and any affiliate of either of them
(collectively, "Dreyfus") for advertising and marketing Class B shares and
for providing certain services to the holders of Class B shares. Under the
Service Plan, the Distributor and Dreyfus may make payments to certain
financial institutions, securities dealers and other financial industry
professionals (collectively, "Service Agents") in respect to these
services. The Fund's Board of Trustees believes that there is a reasonable
likelihood that the Service Plan will benefit the Fund and the holders of
Class B shares.
A quarterly report of the amounts expended under the Service Plan, and
the purposes for which such expenditures were incurred, must be made to the
Trustees for their review. In addition, the Service Plan provides that it
may not be amended to increase materially the costs which holders of Class
B shares may bear pursuant to the Service Plan without the approval of the
holders of Class B shares and that other material amendments of the Service
Plan must be approved by the Board of Trustees, and by the Trustees who are
not "interested persons" (as defined in the Act) of the Fund and have no
direct or indirect financial interest in the operation of the Service Plan
or in any agreements entered into in connection with the Service Plan, by
vote cast in person at a meeting called for the purpose of considering such
amendments. The Service Plan is subject to annual approval by such vote of
the Trustees cast in person at a meeting called for the purpose of voting
on the Service Plan. The Service Plan was so approved by the Trustees at a
meeting held on May 24, 1994 and approved by the shareholders on August 5,
1994. The Service Plan may be terminated at any time by vote of a majority
of the Trustees who are not "interested persons" and have no direct or
indirect financial interest in the operation of the Service Plan or in any
agreements entered into in connection with the Service Plan or by vote of
the holders of a majority of Class B shares. For the period January 18,
1994 (commencement of the initial offering of Class B shares) through July
31, 1994, for Class B shares of the Fund $40,491 was paid pursuant to the
Service Plan.
SHAREHOLDER SERVICES PLAN
(CLASS A ONLY)
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled "Shareholder
Services Plan."
The Fund has adopted a Shareholder Services Plan (the "Plan") pursuant
to which the Fund has agreed to reimburse the Distributor for certain
allocated expenses of providing personal services and/or maintaining
shareholder accounts with respect to Class A shares only. The services
provided may include personal services relating to shareholder accounts,
such as answering shareholder inquiries regarding the Fund and providing
reports and other information, and services related to the maintenance of
shareholder accounts.
A quarterly report of the amounts expended under the Plan, and the
purposes for which such expenditures were incurred, must be made to the
Trustees for their review. In addition, the Plan provides that material
amendments of the Plan must be approved by the Board of Trustees, and by
the Trustees who are not "interested persons" (as defined in the Act) of
the Fund or the Manager and have no direct or indirect financial interest
in the operation of the Plan, by vote cast in person at a meeting called
for the purpose of considering such amendments. The Plan is subject to
annual approval by such vote of the Trustees cast in person at a meeting
called for the purpose of voting on the Plan. The Plan is terminable at
any time by vote of a majority of the Trustees who are not "interested
persons" and have no direct or indirect financial interest in the operation
of the Plan.
For the period fiscal year ended July 31, 1994, $4,897 was
charged to the Fund, with respect to Class A shares, pursuant to the
Shareholder Services Plan.
REDEMPTION OF FUND SHARES
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled "How to
Redeem Fund Shares."
Redemption by Wire or Telephone. By using this procedure, the
investor authorizes the Transfer Agent to act on wire or telephone
redemption instructions from any person representing himself or herself to
be an authorized representative of the investor, and reasonably believed by
the Transfer Agent to be genuine. Ordinarily, the Fund will initiate
payment for shares redeemed pursuant to this procedure on the same business
day if the Transfer Agent receives the redemption request in proper form
prior to 12:00 Noon, New York time, on such day; otherwise, the Fund will
initiate payment on the next business day. Such payment will be made to a
bank that is a member of the Federal Reserve System.
Investors with access to telegraphic equipment may wire redemption
requests to the Transfer Agent by employing the following transmittal code
which may be used for domestic or overseas transmission:
Transfer Agent's
Transmittal Code Answer Back Sign
_______________ ________________
144295 144295 TSSG PREP
Investors who do not have direct access to telegraphic equipment may
have the wire transmitted by contacting a TRT Cables operator at 1-800-654-
7171, toll free. Investors should advise the operator that the above
transmittal code must be used and should also inform the operator of the
Transfer Agent's answer back sign.
Redemption Commitment. The Fund has committed itself to pay in cash
all redemption requests by any shareholder of record, limited in amount
during any 90-day period to the lesser of $250,000 or 1% of the value of
the Fund's net assets at the beginning of such period. Such commitment is
irrevocable without the prior approval of the Securities and Exchange
Commission. In the case of requests for redemption in excess of such
amount, the Board of Trustees reserves the right to make payments in whole
or in part in securities or other assets of the Fund in case of an
emergency or at any time a cash distribution would impair the liquidity of
the Fund to the detriment of the existing shareholders. In such event the
securities would be valued in the same manner as the Fund's portfolio is
valued. If the recipient sold such securities, brokerage charges would be
incurred.
Suspension of Redemptions. The right of redemption may be suspended
or the date of payment postponed (a) during any period when the New York
Stock Exchange is closed (other than a customary weekend and holiday
closing), (b) when trading in the markets the Fund ordinarily utilizes is
restricted, or when an emergency exists as determined by the Securities and
Exchange Commission so that disposal of the Fund's investments or
determination of its net asset value is not reasonably practicable, or (c)
for such other periods as the Securities and Exchange Commission by order
may permit to protect the Fund's shareholders.
DETERMINATION OF NET ASSET VALUE
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled "How to Buy
Fund Shares."
Amortized Cost Pricing. The valuation of the Fund's portfolio
securities is based upon their amortized cost which does not take into
account unrealized capital gains or losses. This involves valuing an
instrument at its cost and thereafter assuming a constant amortization to
maturity of any discount or premium, regardless of the impact of
fluctuating interest rates on the market value of the instrument. While
this method provides certainty in valuation, it may result in periods
during which value, as determined by amortized cost, is higher or lower
than the price the Fund would receive if it sold the instrument.
The Board of Trustees has established, as a particular responsibility
within the overall duty of care owed to the Fund's investors, procedures
reasonably designed to stabilize the Fund's price per share as computed for
purposes of purchases and redemptions at $1.00. Such procedures include
review of the Fund's portfolio holdings by the Board of Trustees, at such
intervals as it deems appropriate, to determine whether the Fund's net
asset value calculated by using available market quotations or market
equivalents deviates from $1.00 per share based on amortized cost. Market
quotations and market equivalents used in such review are obtained from an
independent pricing service (the "Service") approved by the Board of
Trustees. The Service values the Fund's investments based on methods which
include consideration of: yields or prices of municipal obligations of
comparable quality, coupon, maturity and type; indications of values from
dealers; and general market conditions. The Service also may employ
electronic data processing techniques and/or a matrix system to determine
valuations.
The extent of any deviation between the Fund's net asset value based
upon available market quotations or market equivalents and $1.00 per share
based on amortized cost will be examined by the Board of Trustees. If such
deviation exceeds 1/2 of 1%, the Board of Trustees will consider what
actions, if any, will be initiated. In the event the Board of Trustees
determines that a deviation exists which may result in material dilution or
other unfair results to investors or existing shareholders, it has agreed
to take such corrective action as it regards as necessary and appropriate,
including: selling portfolio instruments prior to maturity to realize
capital gains or losses or to shorten average portfolio maturity;
withholding dividends or paying distributions from capital or capital
gains; redeeming shares in kind; or establishing a net asset value per
share by using available market quotations or market equivalents.
New York Stock Exchange Closings. The holidays (as observed) on which
the New York Stock Exchange is closed currently are: New Year's Day,
Presidents' Day, Good Friday, Memorial Day, Independence Day, Labor Day,
Thanksgiving and Christmas.
PORTFOLIO TRANSACTIONS
Portfolio securities ordinarily are purchased from and sold to parties
acting as either principal or agent. Newly-issued securities ordinarily
are purchased directly from the issuer or from an underwriter; other
purchases and sales usually are placed with those dealers from which it
appears that the best price or execution will be obtained. Usually no
brokerage commissions, as such, are paid by the Fund for such purchases and
sales, although the price paid usually includes an undisclosed compensation
to the dealer acting as agent. The prices paid to underwriters of newly-
issued securities usually include a concession paid by the issuer to the
underwriter, and purchases of after-market securities from dealers
ordinarily are executed at a price between the bid and asked price. No
brokerage commissions have been paid by the Fund to date.
Transactions are allocated to various dealers by the Fund's Portfolio
managers in their best judgment. The primary consideration is prompt and
effective execution of orders at the most favorable price. Subject to that
primary consideration, dealers may be selected for research, statistical or
other services to enable the Manager to supplement its own research and
analysis with the views and information of other securities firms and may
be selected based upon their sales of Fund shares.
Research services furnished by brokers through which the Fund effects
securities transactions may be used by the Manager in advising other funds
it advises and, conversely, research services furnished to the Manager by
brokers in connection with other funds the Manager advises may be used by
the Manager in advising the Fund. Although it is not possible to place a
dollar value on these services, it is the opinion of the Manager that the
receipt and study of such services should not reduce the overall expenses
of its research department.
INVESTOR SERVICES
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled "Investor
Services."
Exchange Privilege. By using this Privilege, the investor authorizes
the Distributor to act on exchange instructions from any person
representing himself or herself to be an authorized representative of the
investor and reasonably believed by the Distributor to be genuine.
Telephone exchanges may be subject to limitations as to the amount involved
or the number of telephone exchanges permitted. Shares will be exchanged
at the net asset value next determined after receipt of an exchange request
in proper form. Shares in certificate form are not eligible for telephone
exchange.
Dreyfus Auto-Exchange Privilege. Dreyfus Auto-Exchange Privilege
permits an investor to purchase, in exchange for shares of the Fund, shares
of Dreyfus Cash Management, Dreyfus Cash Management Plus, Inc., Dreyfus
Government Cash Management, Dreyfus Municipal Cash Management Plus, Dreyfus
Tax Exempt Cash Management, Dreyfus Treasury Cash Management and Dreyfus
Treasury Prime Cash Management. This Privilege is available only for
existing accounts. Shares will be exchanged on the basis of relative net
asset value. Enrollment in or modification or cancellation of this
Privilege is effective three business days following notification by the
Investor. An investor will be notified if its account falls below the
amount designated to be exchanged under this Privilege. In this case, an
investor's account will fall to zero unless additional investments are made
in excess of the designated amount prior to the next Auto-Exchange
Transaction. Shares issued in certificate form are not eligible for Auto-
Exchange.
The Exchange Privilege and Dreyfus Auto-Exchange Privilege are
available to investors resident in any state in which shares of the fund
being acquired may legally be sold. Shares may be exchanged only between
accounts having identical names and other identifying designations.
The Fund reserves the right to reject any exchange request in whole or
in part. The Exchange Privilege or Dreyfus Auto-Exchange Privilege may be
modified or terminated at any time upon notice to investors.
DIVIDENDS, DISTRIBUTIONS AND TAXES
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled "Dividends,
Distributions and Taxes."
Ordinarily, gains and losses realized from portfolio transactions will
be treated as capital gain or loss. However, all or a portion of any gains
realized from the sale or other disposition of certain market discount
bonds will be treated as ordinary income under Section 1276 of the Internal
Revenue Code of 1986, as amended.
YIELD INFORMATION
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled "Yield
Information."
For the seven-day period ended July 31, 1994, yield and effective
yield for Class A shares were 2.62% and 2.65%, respectively, and for Class
B shares were 2.37% and 2.40%, respectively. Yield is computed in
accordance with a standardized method which involves determining the net
change in the value of a hypothetical pre-existing Fund account having a
balance of one share at the beginning of a seven calendar day period for
which yield is to be quoted, dividing the net change by the value of the
account at the beginning of the period to obtain the base period return,
and annualizing the results (i.e., multiplying the base period return by
365/7). The net change in the value of the account reflects the value of
additional shares purchased with dividends declared on the original share
and any such additional shares and fees that may be charged to the
shareholder's account, in proportion to the length of the base period and
the Fund's average account size, but does not include realized gains and
losses or unrealized appreciation and depreciation. Effective yield is
computed by adding 1 to the base period return (calculated as described
above), raising that sum to a power equal to 365 divided by 7, and
subtracting 1 from the result.
Based upon a 1994 Federal, New York State and New York City income tax
rate of 47.05%, the Fund's tax equivalent yield for the seven-day period
ended July 31, 1994 was 4.95% for Class A shares and 4.48% for Class B
shares. Tax equivalent yield is computed by dividing that portion of the
yield or effective yield (calculated as described above) which is tax
exempt by 1 minus a stated tax rate and adding the quotient to that
portion, if any, of the yield of the Fund that is not tax exempt.
The tax equivalent yield noted above represents the application of the
highest Federal, New York State and New York City marginal personal income
tax rates presently in effect. For Federal income tax purposes, a 39.6%
tax rate has been used. For New York State and New York City personal
income tax purposes, tax rates of 7.875% and 4.46%, respectively, have been
used. The tax equivalent figure, however, does not reflect the potential
effect of any other local (including, but not limited to, county, district
or city) taxes, including applicable surcharges. In addition, there may be
pending legislation which could affect such stated tax rates or yield.
Each investor should consult its tax adviser, and consider its own factual
circumstances and applicable tax laws, in order to ascertain the relevant
tax equivalent yield.
Yields will fluctuate and are not necessarily representative of future
results. Each investor should remember that yield is a function of the
type and quality of the instruments in the portfolio, portfolio maturity
and operating expenses. An investor's principal in the Fund is not
guaranteed. See "Determination of Net Asset Value" for a discussion of the
manner in which the Fund's price per share is determined.
From time to time, the Fund may use hypothetical tax equivalent yields
or charts in its advertising. These hypothetical yields or charts will be
used for illustrative purposes only and not as representative of the Fund's
past or future performance.
From time to time, advertising materials for the Fund may refer to or
discuss then-current or past economic conditions, developments and/or
events, including actual or proposed tax legislation. From time to time,
advertising materials for the Fund may also refer to statistical or other
information concerning trends relating to investment companies, as compiled
by industry associations such as the Investment Company Institute.
INFORMATION ABOUT THE FUND
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled "General
Information."
Each Fund share has one vote and, when issued and paid for in
accordance with the terms of the offering, is fully paid and nonassessable.
Fund shares have no preemptive, subscription or conversion rights and are
freely transferable.
The Fund sends annual and semi-annual financial statements to all its
shareholders.
In early 1974, the Manager commenced offering the first money market
fund to be widely offered on a retail basis, Dreyfus Liquid Assets, Inc.
Money market mutual funds have subsequently grown into a multi-billion
dollar industry.
The Fund is a member of the Family of Dreyfus Cash Management Funds
which are designed to meet the needs of an array of institutional
investors. As of September 15, 1994, the total net assets of the family of
Dreyfus Cash Management Funds amounted to approximately $14.6 billion.
CUSTODIAN, TRANSFER AND DIVIDEND DISBURSING AGENT, COUNSEL
AND INDEPENDENT AUDITORS
The Bank of New York, 110 Washington Street, New York, New York 10286,
acts as custodian of the Fund's investments. The Shareholder Services
Group, Inc., a subsidiary of First Data Corporation, P.O. Box 9671,
Providence, Rhode Island 02940-9671, is the Fund's transfer and dividend
disbursing agent. Neither The Bank of New York nor The Shareholder
Services Group, Inc. has any part in determining the investment policies of
the Fund or which securities are to be purchased or sold by the Fund.
Stroock & Stroock & Lavan, 7 Hanover Square, New York, New York 10004-
2696, as counsel for the Fund, has rendered its opinion as to certain legal
matters regarding the due authorization and valid issuance of the shares of
beneficial interest being sold pursuant to the Fund's Prospectus.
Ernst & Young LLP, 787 Seventh Avenue, New York, New York 10019,
independent auditors, have been selected as auditors of the Fund.
APPENDIX A
RISK FACTORS--INVESTING IN NEW YORK MUNICIPAL OBLIGATIONS
The financial condition of New York State (the "State") and certain of
its public bodies (the "Agencies") and municipalities, particularly New
York City (the "City"), could effect the market values and marketability of
New York Municipal Obligations which may be held by the Fund. The
following information constitutes only a brief summary, does not purport to
be a complete description, and is based on information drawn from official
statements relating to securities offerings of the State, the City and the
Municipal Assistance Corporation for the City of New York ("MAC") available
as of the date of this Statement of Additional Information. While the Fund
has not independently verified such information, it has no reason to
believe that such information is not correct in all material respects.
The 1990-91 fiscal year was the third consecutive year in which the
State incurred a cash-basis operating deficit in its General Fund and
issued deficit notes. The slowdown in the New York and regional economy
proved to be greater than anticipated in the 1990-91 fiscal year,
contributing to substantial reductions in actual tax receipts from amounts
projected by the State in the 1990-91 State Financial Plan. Overall, the
1990-91 State Financial Plan as formulated in May 1990 overestimated actual
tax receipts in the 1990-91 fiscal year by $1.72 billion. Approximately
$1.044 billion of the shortfall was attributable to an overestimate of
personal income tax receipts, $440 million was attributable to an
overestimate of sales and use tax receipts and approximately $124 million
was attributable to an overestimate of business tax receipts. Total
General Fund receipts, including Transfers from Other Funds, were $1.958
billion below the May 1990 projection. During the 1990-91 fiscal year, the
State implemented actions that yielded net spending reductions of $876
million. After implementing these measures, the State incurred a cash-
basis operating deficit in the General Fund of $1.081 billion, which was
financed through the public issuance of $1.082 billion in tax and revenue
anticipation notes in early 1991.
In 1990, S&P and Moody's lowered their ratings of the State's general
obligation debt from AA- to A and A-1 to A, respectively. In addition, S&P
and Moody's lowered their ratings in 1990 on New York's short-term notes
from SP-1+ to SP-1 and from MIG-1 to MIG-2, respectively. The State's A-1+
rated commercial paper and variously rated moral obligation, lease
purchase, guarantee and contractual obligation debt at that time remained
on S&P CreditWatch with negative implications. In February 1991, Moody's
lowered its rating on the City's general obligation bonds from A to Baa1.
In April 1991, S&P downgraded New York City's municipal notes from SP-1 to
SP-2. The rating changes reflect the rating agencies' concerns about the
financial condition of New York State and City, the heavy debt load of the
State and City, and economic uncertainties in the region.
(1) The State, Agencies and Other Municipalities. During the mid-
1970s, some of the Agencies and municipalities (in particular, the City)
faced extraordinary financial difficulties, which affected the State's own
financial condition. These events, including a default on short-term notes
issued by the New York State Urban Development Corporation ("UDC") in
February 1975, which default was cured shortly thereafter, and a
continuation of the financial difficulties of the City, created substantial
investor resistance to securities issued by the State and by some of its
municipalities and Agencies. For a time, in late 1975 and early 1976,
these difficulties resulted in a virtual closing of public credit markets
for State and many State related securities.
In response to the financial problems confronting it, the State
developed and implemented programs for its 1977 fiscal year that included
the adoption of a balanced budget on a cash basis (a deficit of $92 million
that actually resulted was financed by issuing notes that were paid during
the first quarter of the State's 1978 fiscal year). In addition,
legislation was enacted limiting the occurrence of additional so-called
"moral obligation" and certain other Agency debt, which legislation does
not, however, apply to MAC debt.
State Financial Results. The 1978 fiscal year saw an improvement in
the financial condition of the State, its Agencies and municipalities
generally, although certain municipalities (including the City) and certain
Agencies continued to face financial difficulties. The State adopted and
adhered to a balanced budget, with receipts and disbursements on a cash
basis of approximately $11.18 billion. For its 1979, 1980, 1981 and 1982
fiscal years, the State achieved balanced budgets with receipts and
disbursements on a cash basis of $11.9 billion, $13.2 billion, $15.2
billion and $16.781 billion, respectively. During the 1982 fiscal year,
the State had full access to the public credit markets for its borrowing
needs.
The State completed its fiscal years ended March 31, 1983, 1984, 1985
and 1986 with combined governmental funds operating deficits of $826
million, $3.399 billion, $3.425 billion and $3.124 billion, respectively,
determined in accordance with generally accepted accounting principles
("GAAP").
During the fiscal years ended March 31, 1987, 1988, 1989 and 1990, the
State experienced significant unanticipated variations in the result of the
State Financial Plan, particularly with respect to revenue projections,
which it believes resulted principally from changes in taxpayer behavior
caused by the Federal Tax Reform Act of 1986 (the "Tax Reform Act"). The
Tax Reform Act substantially altered definitions of income and deductions
in the computation of taxable income and substantially lowered tax rates
used in the computation of Federal taxes. In 1987, the State enacted
legislation that conformed State law to most of those definitional changes
and also lowered tax rates. Those changes "broadened" the income tax base
through such devices as full inclusion of capital gains, restrictions on
certain losses and adjustments to income. Those changes in the Federal tax
law are expected to continue to influence taxpayer behavior during the next
several years. For State personal income taxes, the net effect of those
changes is to make estimates and forecasts of adjusted gross income less
reliable than they had been in the past and to add substantial uncertainty
to estimates of State tax liability based on such estimates and forecasts.
In large part because of these uncertainties, the State's Financial Plan
overestimated General Fund tax receipts in the 1988-89 and 1989-90 fiscal
years by $1.9 billion and $1.6 billion, respectively.
During its 1988-89, 1989-90 and 1990-91 fiscal years, the State
incurred cash basis operating deficits in the General Fund of $529
million, $775 million and $1.081 billion, respectively, prior to the
issuance of short-term tax and revenue anticipation notes owing to lower-
than-projected receipts, which it believes to have been principally the
result of a significant slowdown in the New York and regional economy and
changes in taxpayer behavior caused by the Tax Reform Act.
In its 1988-89 fiscal year, the State experienced a significant drop
in receipts as compared to projections contained in the State Financial
Plan formulated in April 1988. General Fund tax receipts were
approximately $1.9 billion lower than projected in April 1988. After
reflecting more than $1 billion in additional receipts and transfers
resulting from deficit-reducing actions during the course of the fiscal
year, total General Fund receipts in fiscal 1988-89 were $797 million below
the original estimates.
General Fund tax receipts for 1989-90 were $1.615 billion lower than
amounts projected in April 1989. After more than $350 million in deficit
reduction measures taken during the fiscal year, consisting of additional
non-tax receipts and transfers described below, and increases in certain
other non-tax receipts, total General Fund receipts were $1.159 billion
below the April 1989 projections. The State also effected net spending
reductions of $384 million, which together with the deficit reduction
measures resulted in a cash basis operating deficit in the General Fund of
$775 million, which was financed through the issuance of tax and revenue
anticipation notes. To offset a portion of these shortfalls, the State
took several nonrecurring actions to increase receipts in its 1989-90
fiscal year. These actions included the transfer of excess balances from
several State funds, including $230 million from the State Insurance Fund,
$86 million from the Industry Fee Transfer Account of the Hazardous Waste
Remedial Fund and $34 million from the Court Facilities Incentive Aid Fund.
The advent of a recession in the national and regional economies
during 1990-91, and other factors as described below, caused major downward
revisions to estimates of receipts in 1990-91. Total General Fund receipts
and transfers from other funds in the 1990-91 fiscal year were $28.6
billion, a decline of $1.9 billion from projections made in the initial
1990-91 financial plan formulated May 23, 1990, immediately after adoption
of the 1990-91 budget. General Fund tax receipts were $27.4 billion, down
$1.7 billion from projections made in May 1990. The State implemented a
deficit-reduction plan in December 1990, which had the effect of reducing
the General Fund cash-basis operating deficit to $1.081 billion. The State
met the deficit through two issuances of tax and revenue anticipation
notes: a public sale of $905 million on February 28, 1991 and a sale of
$176.5 million to the State's Short-Term Investment Pool on March 29, 1991.
Personal income tax receipts totalled $14.516 billion, a decline of
$1.044 billion from the $15.560 billion projected in the 1990-91 State
Financial Plan formulated in May 1990, primarily as a result of the
recession.
User taxes and fees were down $509 million, as adjusted, from May 1990
projections to $7.702 billion.
Specific causes of the $509 million drop include lower growth in wage
income and nominal spending on consumer durables. Business taxes fell $124
million from the May 1990 projection to $4.017 billion. The major cause
was a drop of $114 million in collections from banks reflecting the
continued poor financial results of the banking industry. Other taxes
totalled $1.199 billion, a reduction of $43 million from the May 1990
projections. Real estate-based taxes were down $151 million to $410
million, primarily due to a sharp drop in real estate transactions caused
by the recession. Estate and gift tax revenues were up $108 million to
$789 million, resulting from a larger number of settlements of extra-large
estates.
Receipts and transfers from other funds to the General Fund increased
from $27.731 billion in its 1988-89 fiscal year to $28.914 billion in its
1989-90 fiscal year. During its 1990-91 fiscal year, however, General Fund
receipts and transfers fell to $28.592 billion. Similarly, disbursements
and transfers to other funds increased from $28.244 billion during the
State's 1988-89 fiscal year to $29.229 billion in its 1989-90 fiscal year,
but fell to $28.898 billion in its 1990-91 fiscal year.
Borrowings by the State in the public credit markets during the 1988-
89 and 1989-90 fiscal years totalled $3.6 billion and $5.8 billion,
respectively. Of these amounts $2.6 billion and $3.9 billion,
respectively, were annual seasonal borrowings. In 1990-91, State
borrowings in the public credit markets in 1990-91 totalled $6.0 billion,
including annual seasonal borrowings of $4.1 billion. In addition, $905
million in tax and revenue anticipation notes maturing on December 30, 1991
were issued in February 1991 and a $176.5 million tax and revenue
anticipation note, which matures January 17, 1992 was issued to the State's
Short-Term Investment Pool on March 29, 1991. This note is callable at any
time by the State. In addition, the State issued $758.5 million of bonds
and notes, exclusive of bonds issued to redeem bond anticipation notes,
during 1990-91 to finance capital projects. Based on preliminary analyses
made in June 1991, the Comptroller believes that the operating deficit in
the GAAP-basis General Fund for the 1990-91 fiscal year could be
approximately $500 million to $800 million, after reflecting payments of
$598 million to the Education Accumulation Revolving Account and
approximately $360 million in tax refunds on tax returns for the 1990 year
and after reflecting the $800 million benefit to General Fund operating
results resulting from the February 1991 sale of bonds. In the 1989-90
fiscal year the State had an audited GAAP General Fund operating deficit of
$673 million.
The 1991-92 State Financial Plan was formulated on June 10, 1991 only
after substantial disagreement between the Governor and the legislative
leaders over spending levels, revenue-raising measures and estimates of the
impact of legislative actions. In formulating the 1991-92 State Financial
Plan, the Governor stated that to ensure that the State's budget is
balanced, he had vetoed spending which the Legislature added to his
proposed Executive Budget without providing the necessary revenues.
The 1991-92 State Financial Plan is based on an economic projection
that the State will perform more poorly that the nation as a whole.
Although it projects that the national economy will begin to recover in the
third quarter of calendar 1991, the Division of the Budget expects that the
State's economy will take longer to recover, with modest growth resuming in
the second quarter of calendar 1992, after the close of the State's 1991-92
fiscal year. Many uncertainties exist in forecasts of both the national
and State economies, including consumer attitudes toward spending, Federal
financial and monetary policies, and the state of the world economy, which
could have an adverse effect on the State.
The volatility of employment and income since 1987 in the finance,
insurance and real estate sector of the New York City economy and related
effects on other sectors has increased the uncertainty involved in
estimating personal income and business tax receipts and has contributed to
errors in estimates of revenue from the sales tax and the real estate-based
taxes. The 1991-92 State Financial Plan assumes, among other things, a
further slowdown of the New York and regional economy, and its projection
of receipts is based in part upon that assumption. There can, however, be
no assurance that the State and regional economy will not experience
weaker-than-predicted results in the 1991-92 fiscal year with corresponding
material and adverse effects on the State's projections of receipts.
The principal operating fund of the State is the General Fund. It
receives all State income that is not required by law to be deposited in
another fund and, for 1991-92, includes approximately 92% of total State
tax receipts and many other revenues. After including transfers from Other
Funds, the 1991-92 General Fund shows a $38 million positive balance on a
cash basis with projected receipts of $30.557 billion, an increase of
$1.965 billion (6.9%) over total receipts (excluding the amount received
from temporary borrowing) in the 1990-91 fiscal year. The receipts amounts
are before the impoundment of receipts for repayment of the 1991 Deficit
Notes of $1.081 billion in 1991-92 and exclude proceeds of $1.081 billion
in 1991 deficit tax and revenue anticipation notes of 1990-91. After
including Transfers to Other Funds, total General Fund disbursements in the
1991-92 fiscal year are projected to be $29.394 billion, an increase of
$496 million (1.7%) over the total amount disbursed and transferred in the
1990-91 fiscal year.
Taxes, which account for 98% of total available General Fund receipts
before the impoundment of $1.081 billion to redeem the 1991 deficit tax and
revenue anticipation notes, are projected to total $27.433 billion, up
$1.315 billion (5%) from the amount collected during the 1990-91 fiscal
year. Of the increase in total taxes, approximately $687 million
represents higher personal income tax receipts, $42 million represents
higher user taxes and fees receipts, and $656 million represents greater
receipts from business taxes, while collections from other taxes are
projected to decline $70 million.
The Special Revenue Funds, representing approximately 35% of 1991-92
State Financial Plan receipts, account for State receipts from specific
sources that are legally restricted in use to specified purposes and
include all moneys received from the Federal government. Total receipts in
Special Revenue Funds are projected at $17.885 billion, an increase of
17.1% from fiscal year 1990-91. Total receipts consist of Federal grants
($13.232 billion), miscellaneous receipts ($3.909 billion) and dedicated
taxes ($744 million).
Federal grants account for 74% of receipts in Special Revenue Funds
with approximately 86% of the Federal funds received by the State coming
through the Department of Health and Human Services Fund. Another 10% of
these Federal funds are used in a variety of program areas, including aid
to students, home energy assistance, food and nutrition and preservation of
the environment. Miscellaneous receipts account for 22% of receipts in
Special Revenue Funds and consist of fees and other charges, the proceeds
of which are dedicated to the support of specific programs. This category
also includes the proceeds of the State's lottery, which account for 23% of
total miscellaneous receipts. Tax revenues account for 4% of receipts in
Special Revenue Funds and are dedicated to the support of transit programs,
including the MTA. Disbursements from Special Revenue Funds are projected
to be $19.016 billion, an increase of $1.888 billion (11%) from fiscal year
1990-91. Grants to local governments disbursed from this fund type are
projected at $14.023 billion for the 1991-92 fiscal year.
The Capital Projects Funds are used to finance the acquisition and
construction of major capital facilities and to aid local government units
and Agencies in financing capital constructions. Capital Projects Funds
are estimated to account for 5.3% of total receipts and 7.3% of total
disbursements in the 1991-92 State Financial Plan.
Total receipts in Capital Projects Funds are projected at $2.745
billion, representing an increase of $970 million (55%) from fiscal 1990-91
receipts. Federal grants for capital projects, largely highway-related,
are projected to account for 34% of the total receipts in Capital Projects
Funds in the State's 1991-92 fiscal year. The preponderance of Federal
grants (70%) received in Capital Projects Funds represent Federal support
for highway programs, with the balance supporting various environmental,
recreation and public protection programs. Total disbursements for capital
projects are projected to be $3.778 billion, an increase of $647 million
(21%) from fiscal 1990-91. Of total disbursements from Capital Projects
Funds, approximately 50% is for various transportation purposes, including
highways and mass transportation facilities; 7% is for programs of the
Department of Correctional Services and other public protection activities;
18% is for environmental and recreational programs; 5% is for educational
programs; 11% is for health and mental hygiene facilities; and 7% is for
housing and economic development programs. The balance is for the
maintenance of State office facilities and various other capital programs.
The Debt Service Funds serve to fulfill State debt service on long-
term general obligation State debt and other State lease/purchase and
contractual obligation financing commitments. Total receipts in Debt
Service Funds are projected to reach $2.099 billion, representing a
decrease of $743 million (26%) from fiscal 1990-91 receipts. The decrease
is mainly attributable to the reclassification of SUNY tuition from debt
service funds receipts to special revenue funds receipts. Total
disbursements from Debt Service Funds for debt service, lease-purchase and
contractual-obligation financing commitments are projected to be $1.532
billion or $512 million more than in fiscal 1990-91. Disbursements from
Debt Service Funds include $1.198 billion in debt service payments on full
faith and credit debt and lease-purchase and contractual-obligation
financing commitments largely supported by the General Fund.
The State anticipates that its borrowings for capital purposes will
consist of approximately $766 million in general obligation bonds and $140
million in new commercial paper issuances for new capital projects. In
addition, it is anticipated that the State will issue $70 million of its
bonds for the purpose of redeeming outstanding commercial paper bond
anticipation notes. The State also anticipates the issuance of
approximately $25 million in bonds for the purpose of redeeming outstanding
bond anticipation notes. The projections of the State regarding its
borrowings for the 1991-92 fiscal year may change if actual receipts fall
short of State projections or if other circumstances require. The
Legislature has authorized the issuance of up to $105 million in
certificates of participation for equipment purchases and real property
purposes during the State's 1991-92 fiscal year.
The Governor presented a summary financial plan prepared on a GAAP
basis together with the Executive Budget for the 1991-92 fiscal year. That
plan included an operating surplus on a GAAP basis for the General Fund.
The Governor also is required to prepare a summary financial plan for the
four governmental funds on a GAAP basis for the 1991-92 fiscal year as soon
as practicable after the formulation of the 1991-92 State Financial Plan.
Based upon the cash-basis 1991-92 State Financial Plan, the Division of the
Budget expects that the 1991-92 State Financial Plan will show a surplus on
a GAAP basis.
State Agencies. The fiscal stability of the State is related, at
least in part, to the fiscal stability of its localities and various of its
Agencies. Various Agencies have issued bonds secured, in part, by
non-binding statutory provisions for State appropriations to maintain
various debt service reserve funds established for such bonds (commonly
referred to as "moral obligation" provisions).
At September 30, 1990, there were 17 Agencies that had outstanding
debt of $100 million or more. The aggregate outstanding debt, including
refunding bonds, of these 17 Agencies, was $52.1 billion as of September
30, 1990, of which approximately $10.2 billion was moral obligation debt
and approximately $10.7 billion was financed under lease purchase or
contractual obligation financing arrangements. Debt service on the
outstanding Agency obligations normally is paid out of revenues generated
by the Agencies' projects or programs, but in recent years the State has
provided special financial assistance, in some cases on a recurring basis,
to certain Agencies for operating and other expenses and for debt service
pursuant to moral obligation indebtedness provisions or otherwise.
Additional assistance is expected to continue to be required in future
years.
Several Agencies have experienced financial difficulties in the past.
Certain Agencies continue to experience financial difficulties requiring
financial assistance from the State. Failure of the State to appropriate
necessary amounts or to take other action to permit certain Agencies to
meet their obligations could result in a default by one or more of such
Agencies. If a default were to occur, it would likely have a significant
effect on the marketability of obligations of the State and the Agencies.
These Agencies are discussed below.
The New York State Housing Finance Agency ("HFA") provides financing
for multifamily housing, State University construction, hospital and
nursing home development and other programs. In general, HFA depends upon
mortgagors in the housing programs it finances to generate sufficient funds
from rental income, subsidies and other payments to meet their respective
mortgage repayment obligations to HFA, which provide the principal source
of funds for the payment of debt service on HFA bonds, as well as to meet
operating and maintenance costs of the projects financed. From January 1,
1976 through March 31, 1987, the State was called upon to appropriate a
total of $162.8 million to make up deficiencies in the debt service reserve
funds of HFA pursuant to moral obligation provisions. The State has not
been called upon to make such payments since the 1986-87 fiscal year and no
payments are anticipated during the 1992 fiscal year.
UDC has experienced, and expects to continue to experience, financial
difficulties with the housing programs it had undertaken prior to 1975,
because a substantial number of these housing program mortgagors are unable
to make full payments on their mortgage loans. Through a subsidiary, UDC
is currently attempting to increase its rate of collection by accelerating
its program of foreclosures and by entering into settlement agreements.
UDC has been, and will remain, dependent upon the State for appropriations
to meet its operating expenses. The State also has appropriated money to
assist in the curing of a default by UDC on notes which did not contain the
State's moral obligation provision.
The Metropolitan Transportation Authority (the "MTA") oversees New
York City's subway and bus lines by its affiliates, the New York City
Transit Authority and the Manhattan and Bronx Surface Transit Operating
Authority (collectively, the "TA"). Through MTA's subsidiaries, the Long
Island Rail Road Company, the Metro-North Commuter Railroad Company and the
Metropolitan Suburban Bus Authority, the MTA operates certain commuter rail
and bus lines in the New York metropolitan area. In addition, the Staten
Island Rapid Transit Authority, an MTA subsidiary, operates a rapid transit
line on Staten Island. Through its affiliated agency, the Triborough
Bridge and Tunnel Authority (the "TBTA"), the MTA operates certain toll
bridges and tunnels. Because fare revenues are not sufficient to finance
the mass transit portion of these operations, the MTA has depended and will
continue to depend for operating support upon a system of State, local
government and TBTA support and, to the extent available, Federal operating
assistance, including loans, grants and operating subsidies.
For its fiscal year ended December 31, 1990, the MTA's unaudited
results show operating budgets balanced on a cash basis, reflecting
substantial assistance from the State and a 15 cent fare increase that
became effective on January 1, 1990. Over the past several years the State
has enacted several taxes--including a surcharge on the profits of banks,
insurance corporations and general business corporations doing business in
the 12-county region (the "Metropolitan Transportation Region") served by
the MTA and a special .25% regional sales and use tax--that provide
additional revenues for mass transit purposes, including assistance to the
MTA.
For 1991, the MTA's 1990-92 financial plan projected a balanced budget
for the commuter railroads, but a budget gap for the TA of approximately
$70 million, which it proposed be closed by governmental assistance,
revenue enhancements, expense decreases and, to the extent these are
insufficient to close the gap, by a fare increase to take effect by mid-
year 1991.
On June 17, 1991, TA officials announced that the TA's projected gap
for its 1991 fiscal year could reach up to $223 million, primarily as a
result of continued declines in ridership, further deterioration in
revenues from real estate taxes and proposed decreases in State and City
aid to the TA. The TA proposes to close the projected 1991 fiscal year gap
by expenditure reductions (some of which may require legislation),
refundings of outstanding bonds and implementation of a new capital
reimbursement procedure for the TA, among other things. TA officials
project that the 1991 gap would be closed if those actions are successfully
implemented.
For 1992, the MTA's financial plan projects a $375 million budget gap
for the TA, before giving effect to the recurring value of any actions
taken to close the 1991 budget gap but after giving effect to certain
assumptions, such as a 1991-92 labor settlement with net wage increases of
1.5% annually. MTA officials have recently stated, however, that the TA's
gap for 1992 has grown to more that $500 million. For 1992, the plan also
projects a $116 million budget gap for the commuter railroads. Should any
of the assumptions used in arriving at its projections prove incorrect, the
MTA could incur greater deficits and, therefore, would be required to seek
additional State assistance, increase fares, or take other actions.
The Office of the State Deputy Comptroller for New York City (the
"OSDC"), within the officer of the State Comptroller, released a report on
January 23, 1991, reviewing the MTA Financial Plan as it relates to the TA.
The report found that shortcomings in the gap closing program are likely to
result in the imposition of a fare increase. It also noted that further
deterioration in the regional economy may cause additional shortfalls.
A subway fire on December 28, 1990, which caused fatalities and many
injuries, may give rise to substantial claims for damages against both the
TA and the City.
Because the MTA has a calendar fiscal year, factors affecting the
MTA's 1990 fiscal year could affect the 1990-91 State Financial Plan.
In 1981, the State Legislature authorized procedures for the adoption,
approval and amendment of a five-year plan for the capital program designed
to upgrade the performance of the MTA's transportation systems and to
supplement, replace and rehabilitate facilities and equipment, and also
granted certain additional bonding authorization therefor.
As required by the legislation, MTA submitted, and has received
approval by the MTA Capital Program Review Board ("CPRB") of a 1987-91
Capital Program, as amended by CPRB in March 1991, totalling $8.486
billion. The TA portion of the MTA 1987-91 Capital Program totals $6.531
billion, which includes as a funding source $355 million related to the
proposed sale of the New York Coliseum. However, lawsuits challenging the
sale are pending. If the Coliseum site is not developed as planned, the TA
and the commuter railroads may have to defer certain capital projects or
seek other funding sources.
In March 1991, the MTA issued a draft 1992-96 Capital Program proposal
with projected total spending of $11.5 billion of which the TA portion is
$8.3 billion. Currently, the MTA has identified $6 billion in potential
funding sources, leaving a funding gap of $5.5 billion. The MTA expects to
submit its formal proposal to the CPRB in October 1991. If the MTA capital
program is delayed because of funding shortfalls or other factors,
ridership and fare revenues may decline. A loss of fare revenues, among
other things, could impair the MTA's ability to meet its operating expenses
without additional State assistance.
The cities, towns, villages and school districts of the State are
political subdivisions of the State with the powers granted by the State
Constitution and statutes. As the sovereign, the State retains broad
powers and responsibilities with respect to the government, finances and
welfare of these political subdivisions, especially in education and social
services. In recent years the State has been called upon to provide added
financial assistance to certain localities.
Other Localities. Certain localities in addition to the City could
have financial problems leading to requests for additional State assistance
during the State's 1991-92 fiscal year and thereafter. The 1992-92 State
Financial Plan includes a significant reduction in State aid to localities
in such programs as revenue sharing and aid to education from projected
base-line growth in such programs. It is expected that such reductions
will result in the need for localities to reduce their spending or increase
their revenues. The potential impact on the State of such actions by
localities is not included in the projections of the State receipts and
disbursements in the State's 1991-92 fiscal year.
The counties and other localities on Long Island could be affected by
problems relating to the Long Island Lighting Company ("LILCO"), the
investor-owned utility which supplies gas service and substantially all
electric service in Nassau and Suffolk counties and a small portion of
Queens County in the City. LILCO faces serious cash-flow and other
financial difficulties attributable to, among other things, construction
problems on this 809-megawatt Shoreham Nuclear Power Facility ("Shoreham"),
the cash-flow problems for carrying debt service on that facility, certain
litigation and certain problems in obtaining a Federal operating license
for Shoreham.
In February 1989, the Governor and LILCO reached an agreement pursuant
to which LILCO would sell Shoreham to the New York Power Authority for $1
(which would then decommission Shoreham) in return for a schedule of rate
increases which have since been approved by the State Public Service
Commission (the "PSC"). The agreement has been approved by the New York
Power Authority, the Long Island Power Authority (which had been
established in 1986 by the State with the power to acquire LILCO) and
LILCO's shareholders, although various actions have been initiated to
challenge its implementation. The agreement and PSC approved rate
increases have enabled LILCO to reenter the public credit markets. It is
difficult to predict the ultimate fiscal and economic impact on the State
or on local governments on Long Island of any litigation to which LILCO is
or may become a party, or of any bankruptcy by or takeover of LILCO.
Municipalities and school districts have engaged in substantial
short-term and long-term borrowings. In 1989, the total indebtedness of
all localities in the State was approximately $23.4 billion, of which $11.4
billion was debt of the City (excluding $7.5 billion in MAC debt). A small
portion (approximately $56.6 million) of this indebtedness represents
borrowing to finance budgetary deficits and was issued pursuant to enabling
State legislation. State law requires the Comptroller to review and make
recommendations concerning the budgets of those local government units
other than the City authorized by State law to finance deficits during the
period that such deficit financing is outstanding. Fifteen localities had
outstanding indebtedness for deficit financing at the close of their fiscal
year ending 1989.
Certain proposed Federal expenditure reductions would reduce, or in
some cases eliminate, Federal funding of some local programs and
accordingly might impose substantial increased expenditure requirements on
affected localities. If the State, the City or any of the Agencies were to
suffer serious financial difficulties jeopardizing their respective access
to the public credit markets, the marketability of notes and bonds issued
by localities within the State could be adversely affected. Localities
also face anticipated and potential problems resulting from certain pending
litigation, judicial decisions and long-range economic trends. The
longer-range problems of declining city population, increasing expenditures
and other economic trends could adversely affect localities and require
increasing State assistance in the future.
Because of significant fiscal difficulties experienced from time to
time by the City of Yonkers, a Financial Control Board was created by the
State in 1984 to oversee Yonkers' fiscal affairs. Future actions taken by
the Governor or the State Legislature to assist Yonkers in this crisis
could result in the allocation of State resources in amounts that cannot
yet be determined.
Certain litigation pending against the State or its officers or
employees could have a substantial or long-term adverse effect on State
finances. Among the more significant of these litigations are those that
involve: (i) the validity and fairness of agreements and treaties by which
various Indian tribes transferred title to the State of approximately six
million acres of land in central New York; (ii) certain aspects of the
State's Medicaid rates and regulations, including reimbursements to
providers of mandatory and optional Medicaid services; (iii) the care and
housing provided for individuals released from State mental health
facilities; (iv) contamination in the Love Canal area of Niagara Falls; (v)
the use by the State of certain casualty insurance reserve funds; (vi)
educational accommodations for learning-disabled students at a State
University; (vii) alleged employment discrimination by the State and its
agencies; (viii) a challenge to the State's practice of reimbursing certain
Office of Mental Hygiene patient-care expenses with clients' Social
Security benefits; (ix) the treatment provided at several State mental
hygiene facilities; (x) a challenge to the methods by which the State
reimburses localities for the administrative costs of food stamp programs;
(xi) challenges to the methods by which the State computes its aid to
localities and to school districts; (xii) a challenge to the State's
possession of certain funds taken pursuant to the State's Abandoned
Property law; (xiii) alleged responsibility of State officials to assist in
remedying racial segregation in the City of Yonkers; (xiv) an action, in
which the State is a third party defendant, for injunctive or other
appropriate relief, concerning liability for the maintenance of stone
groins constructed along certain areas of Long Island's shoreline;
(xv) actions challenging the constitutionality of legislation enacted
during the 1990 legislative session which changed the actuarial funding
methods for determining contributions to State employee retirement systems;
(xvi) actions challenging legislation enacted in 1990 which requires the
withholding of certain amounts of pay from State employees until their
separation from State employment; (xvii) a challenge to the adequacy of
care available for persons who abuse drugs; and (xviii) an action against
State and City officials alleging that the present level of shelter
allowance for public assistance recipients is inadequate under statutory
standards to maintain proper housing.
Final adverse decisions in such cases could require extraordinary
appropriations or expenditure reductions or both, and might have a
material, adverse effect upon the financial condition of the State and
various of its Agencies and municipal subdivisions.
(2) New York City. In the mid-1970s, the City had large accumulated
past deficits and until recently was not able to generate sufficient tax
and other ongoing revenues to cover expenses in each fiscal year. However,
the City's operating results for the fiscal year ending June 30, 1990 were
balanced in accordance with GAAP, the ninth consecutive year in which the
City achieved balanced operating results in accordance with GAAP. The
City's ability to maintain balanced operating results in future years is
subject to numerous contingencies and future developments.
The City's economy, whose rate of growth slowed substantially over the
past three years, is currently in recession. During the 1990 and 1991
fiscal years, as a result of the slowing economy, the City has experienced
significant shortfalls in almost all of its major tax sources and increases
in social services costs, and has been required to take actions to close
substantial budget gaps in order to maintain balanced budgets in accordance
with the Financial Plan. Since the stock market crash, the City's tax
revenues have been below expected levels, and the revised local employment
data available since January 1989 have confirmed that the City's economy
has been severely affected by the stock market crash, and that the impact
of layoffs in the finance, insurance and real estate sector is greater than
had been believed earlier.
In 1975, the City became unable to market its securities and entered a
period of extraordinary financial difficulties. In response to this
crisis, the State also enacted the New York State Financial Emergency Act
for the City of New York (the "Emergency Act") which, among other things,
created the Financial Control Board (the "Control Board") to oversee the
City's financial affairs and facilitate its return to the public credit
markets. The State also established the OSDC to assist the Control Board
in exercising its powers and responsibilities. On June 30, 1986, the
Control Board's powers of approval over the City Financial Plan were
suspended pursuant to the Emergency Act. However, the Control Board, MAC
and OSDC continue to exercise various monitoring functions relating to the
City's financial condition. The City prepares and operates under a
four-year financial plan which is submitted annually to the Control Board
for review and which the City periodically updates.
The City's independently audited operating results for each of its
fiscal years from 1981 through 1990 show a General Fund surplus reported in
accordance with GAAP, after taking into account actions in each of those
years which in effect prepaid certain City costs, averaging $450 million
per year, in the next fiscal year. The City has eliminated the cumulative
deficit in its net General Fund position. In addition, the City's
financial statements for the 1990 fiscal year received an unqualified
opinion from the City's independent auditors, the eighth consecutive year
the City has received such an opinion.
The City released its audited operating results for the 1990 fiscal
year on October 31, 1990, reporting revenues of $25.937 billion and
expenditures of $25.932 billion, on a GAAP basis, as of June 30, 1990. The
GAAP surplus was achieved despite a significant decline in revenues,
chiefly non-property tax collections, during the fiscal year resulting from
a downturn in local economic growth. The City compensated for these
revenue shortages by implementing certain expenditure reduction measures.
On July 11, 1990, the City submitted to the Control Board a four-year
financial plan for its 1991 through 1994 fiscal years. The 1991-1994
Financial Plan projected a balanced budget in fiscal year 1991, based on
revenues of $27.922 billion, and budget gaps of $970 million in fiscal year
1992, $811 million in fiscal year 1993 and $872 million in fiscal year
1994, which were projected to be eliminated through a combination of City,
State and Federal actions.
On October 1, 1990, the City reached a labor agreement with the United
Federation of Teachers (the "UFT") providing for a one-year increase in
wages and salaries of 5.5% and other benefits.
On December 20, 1990, the Bureau of Labor Statistics, in its annual
year-end report on regional employment, reported expected losses in the
City of 47,000 private-sector jobs in 1990, or a net loss of 35,700 jobs
after factoring in the increase in government employment.
On January 3, 1991, the City's Director of the Budget stated that he
estimated the budget gap for the City's 1991 fiscal year at $500 million.
On May 17, 1991, the City submitted to the Control Board its most
recent modification to the Financial Plan for the 1991 fiscal year. The
1991 modification projects a balanced budget, based on revenues of $27.973
billion, and assumes the implementation of a variety of actions required to
be taken prior to June 30, 1991 that would provide increases in revenues
and reductions in expenditures totaling $265 million to maintain this
budget balance.
On June 4, 1991, OSDC issued a report on the 1991 modification. The
report projects further declines in tax revenues over the remainder of the
fiscal year that would offset the Financial Plan's remaining $40 million
general reserve. The report noted that just a slight percentage variance
in non-property tax collections from the amounts forecast over the
remainder of the 1991 fiscal year could translate into a large revenue
surplus or shortfall, and that each of the last three fiscal years has
ended with revenue shortfalls. The report further notes that the City was
able to absorb these shortfalls and maintain budget balance because
spending did not reach planned levels. However, the City has already
counted on this lower spending for fiscal year 1991, thus leaving the City
without its customary year-end financial cushion. The report also
identified other actions the City could take to maintain balance in the
1991 fiscal year, but noted that such actions could exacerbate the already
formidable budget problems projected for the 1992 fiscal year.
On June 19, 1991, the staff of the Control Board issued its report on
the City's May 17 modification to the Financial Plan. The report stated
that the City has a remaining gap in fiscal year 1991 of about $47 million.
Noting that only two weeks remained in the fiscal year, the report stated
that some options available to the City to close the remaining gap still
await implementation and that uncertainties continued to exist that could
enlarge the gap further. The report further noted that certain actions
taken by the City to close its 1991 budget gap were short-term and non-
recurrent and concluded that such actions only make future imbalance worse
and balance harder to achieve.
The City submitted to the Control Board a new Financial Plan for its
fiscal years 1992 through 1995 on May 15, 1991. The 1992-95 Financial Plan
is based on the Mayor's Executive Budget released on May 10, 1991, which
sets forth a program to eliminate a potential budget gap of $3.5 billion in
the 1992 fiscal year. After implementation of this program, which includes
service reductions of almost $1.5 billion, tax increases of almost $1
billion, productivity initiatives of $500 million and other City and State
actions of $500 million, the 1992-95 Financial Plan projects a balanced
budget in the 1992 fiscal year, based on revenues of $28.718 billion. The
Executive Budget is subject to approval by the City Counsel, and certain
revenue-raising initiatives contained in the Executive Budget are subject
to approval by the State Legislature. The City has announced that the
1991-92 State Financial Plan contains approximately $328 million less in
aid from the State than the City had anticipated. The 1992-95 Financial
Plan projects remaining budget gaps of $883 million in fiscal year 1993,
$1.370 billion in fiscal year 1994 and $1.166 billion in fiscal year 1995,
which are proposed to be eliminated through a combination of City and State
actions.
On June 6, 1991, the City Counsel issued a report on the Mayor's
proposed 1992 budget. The City Council stated it would approve no more
than $170 million of the Mayor's proposed $646 million increase in real
property taxes; opposed $400 million of the Mayor's proposed service
reductions while proposing $276 million in alternative expenditure
reductions; called for $350 million in labor-cost savings; and called for
non-recurring revenue increases of $225 million from financing actions,
including MAC debt refinancings. On June 15, 1991, the Mayor and the City
Counsel announced that they would seek approval from the State Legislature
of a $335 million increase in the City personal income tax.
On June 17, 1991, OSDC issued a report on the 1992-95 Financial Plan.
The report noted that as a consequence of increases in the City's
workforce, questionable budget-relief devices that aggravated the City's
financial problems in the long term, a severe recession, and new labor
contracts slated to cost more than $1 billion over fiscal years 1991 and
1992, the City is confronting its worst fiscal crisis since 1975. The
report found that the budget gap for the 1992 fiscal year could be $325
million higher than projected in the 1992-95 Financial Plan, primarily
because of higher costs for personal services and debt service. In
addition, the report indicated that attainment of a number of the gap-
closing actions planned for the 1992 fiscal year, such as $250 million in
additional assistance from the State and $200 million in savings from the
Board of Education, is highly uncertain. The report also noted that the
City Council's opposition to over $800 million of the tax increases and
service reductions proposed in the 1992-95 Financial Plan and the Mayor's
rejection of many of the City Council's alternative proposals could result
in a delayed budget adoption for the 1992 fiscal year beyond the start of
such year. The report warned that such an event could possibly lead to a
lowering of the City's credit rating and a reimposition of a control period
by the Control Board. The staff of the Control Board also is reviewing the
1992-95 Financial Plan and is expected to issue a report on its review
results.
Estimates of the City's revenues and expenditures are based on
numerous assumptions and subject to many uncertainties. If expected
Federal or State aid is not forthcoming, if unforeseen developments in the
economy significantly reduce revenues derived from economically sensitive
taxes or necessitate increased expenditures for public assistance, or if
other uncertainties materialize that reduce expected revenues or increase
projected expenditures, then, to avoid operating deficits, the City may be
required to implement additional actions, including increases in taxes and
reductions in essential City services, that could weaken the City's economy
and tax base. The City also might seek additional assistance from the
State.
The City requires certain amounts of financing for seasonal and
capital spending purposes. Since 1982, the City has satisfied all of its
seasonal financing needs with sales of short-term notes in the public
credit markets. In its 1991 fiscal year, the City has issued $3.65 billion
of notes to meet its seasonal financing needs.
The City's capital financing program projects long-term financing
requirements of approximately $18.4 billion for the City's fiscal years
1991 through 1994, primarily for the construction and rehabilitation of the
City's infrastructure and other fixed assets. The major capital
requirements include capital expenditures for the City's water supply
system, sewage and waste disposal systems, roads, bridges, mass transit,
schools and housing. The City's program assumes the successful sale of its
general obligation bonds and increasing market access in each year for
water and sewer revenue bonds to be issued by a public authority. On
October 9, 1990, S&P placed the City's outstanding general obligation bonds
on "CreditWatch" with negative implications.
(3) State Economic Trends. Over the long-term, the State and the
City also face serious potential economic problems. The City accounts for
approximately 40% of the State's population and personal income, and the
City's financial health affects the State in numerous ways. The State has
long been one of the wealthiest states in the nation. For decades,
however, the State economy has grown more slowly than that of the nation as
a whole, resulting in the gradual erosion of its relative economic
affluence. The causes of this relative decline are varied and complex, in
many cases involving national and international developments beyond the
State's control. In recent years, the State's economic position has
improved in a manner consistent with that of the Northeast as a whole.
Part of the reason for the long-term relative decline in the State's
economy has been attributed to the combined State and local tax burden,
which is among the highest in the United States. The existence of this tax
burden limits the State's ability to impose higher taxes in the event of
future financial difficulties. Recently, the State has been relatively
successful in bringing the rate of growth in the public sector in the State
into line with the slower expansion in the private economy.
The burdens of State and local taxation, in combination with many
other causes of regional economic dislocation, may have contributed to the
decision of businesses and individuals to relocate outside, or not locate
within, the State. In 1987, the State enacted a major personal income tax
reduction and reform program and also reduced the tax rate on corporation
income. In addition, the State has provided various tax incentives to
encourage business relocation and expansion. While no sustained reversal
of the erosion of the State's economic position relative to the nation as a
whole has been projected, the actions to date, in combination with other
causes of regional economic change, have slowed these trends.
APPENDIX B
Description of S&P, Moody's and Fitch ratings:
S&P
Municipal Bond Ratings
An S&P municipal bond rating is a current assessment of the
creditworthiness of an obligor with respect to a specific obligation.
The ratings are based on current information furnished by the issuer
or obtained by S&P from other sources it considers reliable, and will
include: (1) likelihood of default-capacity and willingness of the obligor
as to the timely payment of interest and repayment of principal in
accordance with the terms of the obligation; (2) nature and provisions of
the obligation; and (3) protection afforded by, and relative position of,
the obligation in the event of bankruptcy, reorganization or other
arrangement under the laws of bankruptcy and other laws affecting
creditors' rights.
AAA
Debt rated AAA has the highest rating assigned by S&P. Capacity to
pay interest and repay principal is extremely strong.
AA
Debt rated AA has a very strong capacity to pay interest and repay
principal and differs from the highest rated issues only in small degree.
The AA rating may be modified by the addition of a plus or a minus sign,
which is used to show relative standing within the category.
Municipal Note Ratings
SP-1
The issuers of these municipal notes exhibit very strong or strong
capacity to pay principal and interest. Those issues determined to possess
overwhelming safety characteristics are given a plus (+) designation.
Commercial Paper Ratings
The rating A is the highest rating and is assigned by S&P to issues
that are regarded as having the greatest capacity for timely payment.
Issues in this category are delineated with the numbers 1, 2 and 3 to
indicate the relative degree of safety. Paper rated A-1 indicates that the
degree of safety regarding timely payment is either overwhelming or very
strong. Those issues determined to possess overwhelming safety
characteristics are denoted with a plus sign (+) designation.
Moody's
Municipal Bond Ratings
Aaa
Bonds which are rated Aaa are judged to be of the best quality. They
carry the smallest degree of investment risk and are generally referred to
as "gilt edge." Interest payments are protected by a large or by an
exceptionally stable margin and principal is secure. While the various
protective elements are likely to change, such changes as can be visualized
are most unlikely to impair the fundamentally strong position of such
issues.
Aa
Bonds which are rated Aa are judged to be of high quality by all
standards. Together with the Aaa group they comprise what generally are
known as high grade bonds. They are rated lower than the best bonds
because margins of protection may not be as large as in Aaa securities or
fluctuation of protective elements may be of greater amplitude or there may
be other elements present which make the long-term risks appear somewhat
larger than in Aaa securities. Bonds in the Aa category which Moody's
believes possess the strongest investment attributes are designated by the
symbol Aa1.
Commercial Paper Ratings
The rating Prime-1 (P-1) is the highest commercial paper rating
assigned by Moody's. Issuers of P-1 paper must have a superior capacity
for repayment of short-term promissory obligations, and ordinarily will be
evidenced by leading market positions in well established industries, high
rates of return on funds employed, conservative capitalization structures
with moderate reliance on debt and ample asset protection, broad margins in
earnings coverage of fixed financial charges and high internal cash
generation, and well established access to a range of financial markets and
assured sources of alternate liquidity. Issuers rated Prime-2 (P-2) have a
strong ability for repayment of senior short-term debt obligations.
Capitalization characteristics, while still appropriate, may be more
affected by external conditions. Ample alternate liquidity is maintained.
Municipal Note Ratings
Moody's ratings for state and municipal notes and other short-term
loans are designated Moody's Investment Grade (MIG). Such ratings
recognize the difference between short-term credit risk and long-term risk.
Factors affecting the liquidity of the borrower and short-term cyclical
elements are critical in short-term ratings, while other factors of major
importance in bond risk, long-term secular trends for example, may be less
important over the short run.
A short-term rating may also be assigned on an issue having a demand
feature. Such ratings will be designated as VMIG or, if the demand feature
is not rated, as NR. Short-term ratings on issues with demand features are
differentiated by the use of the VMIG symbol to reflect such
characteristics as payment upon periodic demand rather than fixed maturity
dates and payment relying on external liquidity. Additionally, investors
should be alert to the fact that the source of payment may be limited to
the external liquidity with no or limited legal recourse to the issuer in
the event the demand is not met.
Moody's short-term ratings are designated Moody's Investment Grade as
MIG 1 or VMIG 1 through MIG 4 or VMIG 4. As the name implies, when Moody's
assigns a MIG or VMIG rating, all categories define an investment grade
situation.
MIG 1/VMIG 1
This designation denotes best quality. There is present strong
protection by established cash flows, superior liquidity support or
demonstrated broad-based access to the market for refinancing.
MIG 2/VMIG 2
This designation denotes high quality. Margins of protection are
ample although not so large as in the preceding group.
Fitch
Municipal Bond Ratings
The ratings represent Fitch's assessment of the issuer's ability to
meet the obligations of a specific debt issue or class of debt. The
ratings take into consideration special features of the issue, its
relationship to other obligations of the issuer, the current financial
condition and operative performance of the issuer and of any guarantor, as
well as the political and economic environment that might affect the
issuer's future financial strength and credit quality.
AAA
Bonds rated AAA are considered to be investment grade and of the
highest credit quality. The obligor has an exceptionally strong ability to
pay interest and repay principal, which is unlikely to be affected by
reasonably foreseeable events.
AA
Bonds rated AA are considered to be investment grade and of very high
credit quality. The obligor's ability to pay interest and repay principal
is very strong, although not quite as strong as bonds rated AAA. Because
bonds rated in the AAA and AA categories are not significantly vulnerable
to foreseeable future developments, short-term debt of these issuers is
generally rated F-1+. Plus (+) and minus (-) signs are used with the
rating symbol AA to indicate the relative position of a credit within the
rating category.
Short-Term Ratings
Fitch's short-term ratings apply to debt obligations that are payable
on demand or have original maturities of up to three years, including
commercial paper, certificates of deposit, medium-term notes, and municipal
and investment notes.
Although the credit analysis is similar to Fitch's bond rating
analysis, the short-term rating places greater emphasis than bond ratings
on the existence of liquidity necessary to meet the issuer's obligations in
a timely manner.
F-1+
Exceptionally Strong Credit Quality. Issues assigned this rating are
regarded as having the strongest degree of assurance for timely payment.
F-1
Very Strong Credit Quality. Issues assigned this rating reflect an
assurance of timely payment only slightly less in degree than issues rated
F-1+.
F-2
Good Credit Quality. Issues carrying this rating have a satisfactory
degree of assurance for timely payments, but the margin of safety is not as
great as the F-1+ and F-1 categories.
<TABLE>
<CAPTION>
DREYFUS NEW YORK MUNICIPAL CASH MANAGEMENT
STATEMENT OF INVESTMENTS JULY 31, 1994
PRINCIPAL
TAX EXEMPT INVESTMENTS-100.0% AMOUNT VALUE
------------- ------------
<S> <C> <C>
Town of Islip Industrial Development Agency, IDR, VRDN:
(Brentwood Distribution Project) 3.125% (LOC; Bankers Trust) (a,b)...... $ 1,750,000 $ 1,750,000
(Radiation Dynamics Project) 3.40%, Series A (LOC; Sumitomo Bank) (a,b). 100,000 100,000
Monroe County Industrial Development Agency, Revenue, VRDN (Enbi Corp.)
2.65% (LOC; ABN-Amro Bank) (a,b)........................................ 100,000 100,000
Nassau County Industrial Development Agency, IDR, VRDN
(Manhassett Association Project) 3.275% (LOC; Bankers Trust) (a,b)...... 2,000,000 2,000,000
City of New York:
VRDN:
2.80%, Series A-9 (LOC; Industrial Bank of Japan) (a,b)............... 5,200,000 5,200,000
3.20%, Series E (LOC; Fuji Bank) (a,b)................................ 2,100,000 2,100,000
Trust Cultural Resource Revenue:
(American Museum of Natural History) 2.60%, Series A
(Insured; MBIA and SBPA; Credit Suisse) (a)..................... 3,000,000 3,000,000
(Soloman R. Guggenheim) 2.75%, Series B (LOC; Swiss Bank Corp.) (a,b) 2,900,000 2,900,000
New York City Housing Development Corp., MFMR, VRDN
(York Avenue Development Project) 2.85% (LOC; Chemical Bank) (a,b)...... 5,000,000 5,000,000
New York City Industrial Development Agency, VRDN:
Civil Facility Revenue:
(Childrens Oncology Society-Ronald McDonald House)
2.70% (LOC; Barclays Bank) (a,b).................................. 100,000 100,000
(National Audubon Society) 2.75% (LOC; Swiss Bank Corp.) (a,b)........ 5,300,000 5,300,000
IDR (Nobart-New York Ink Project) 3.25% (LOC; Dai-Ichi Kangyo Bank) (a,b) 3,100,000 3,100,000
New York City Municipal Water Finance Authority, Water and Sewer Systems
Revenue,
VRDN:
2.75%, Series C (Insured; FGIC) (a)................................... 24,000,000 24,000,000
2.75%, Series G (Insured; FGIC) (a)................................... 6,000,000 6,000,000
New York City Transportation Authority, Special Obigation Revenue, RAN
4%, Series A, 12/15/94.................................................. 5,000,000 5,018,239
New York State, GO Notes 4.90%, 3/1/95...................................... 3,060,000 3,090,364
New York State Energy, Research and Development Authority, PCR:
Bonds:
(LILCO Project) 3%, Series A, 3/1/95 (LOC; Deutsche Bank) (b)......... 7,000,000 7,000,000
(New York State Electric and Gas Corp.) 3.25%, 3/15/95 (LOC; JP Morgan) (b) 3,000,000 3,000,000
(Rochester Gas and Electric Corp.) 2.75%, 11/15/94 (LOC; Credit Suisse) (b) 5,000,000 5,000,000
VRDN:
(Central Hudson Gas and Electric Project) 2.75%, Series A (LOC; Bankers
Trust) (a,b)................................................................ 3,000,000 3,000,000
(Niagara Mohawk Power Corp.) 2.70%, Series B (LOC; Toronto Dominion) (a,b) 4,800,000 4,800,000
New York State Environment Facilities Corp., RRR, VRDN (Equity Huntington
Project)
2.85% (LOC; Union Bank of Switzerland) (a,b)............................ 6,600,000 6,600,000
New York State Local Government Assistance Corp., VRDN 2.80%, Series 93A
(LOC: Credit Suisse, Swiss Bank Corp. and Union Bank of Switzerland) (a,b) 6,000,000 6,000,000
New York State Mortgage Agency, Revenue 3.30%, Series 40-C, 12/1/94
(Collateralized; U.S. Treasury Bills and GIC; Morgan Guaranty Trust Co.) 2,500,000 2,500,000
DREYFUS NEW YORK MUNICIPAL CASH MANAGEMENT
STATEMENT OF INVESTMENTS (CONTINUED) JULY 31, 1994
PRINCIPAL
TAX EXEMPT INVESTMENTS (CONTINUED) AMOUNT VALUE
------------- ------------
New York State Thruway Authority, General Revenue, VRDN 2.60% (Insured; FGIC) (a) $ 2,700,000 $ 2,700,000
Onondaga County Industrial Development Agency, IDR, VRDN
(Edgecomb Metals Co. Project) 2.75% (LOC; Banque Nationale de Paris) (a,b) 1,100,000 1,100,000
Orange County Industrial Development Agency, IDR, VRDN
(Minolta Advance Technology Project) 3.40% (LOC; Sanwa Bank) (a,b)...... 2,100,000 2,100,000
Port Authority of New York and New Jersey, Special Obilgation Revenue, VRDN
(Third Installment) 2.85%, Series 3 (LOC; Deutsche Bank) (a,b).......... 5,000,000 5,000,000
South Huntington Union Free School District, TAN 4.25%, 6/30/95............. 4,000,000 4,012,275
Suffolk County, TAN 3%, Series II, 9/15/94 (LOC; Chemical Bank) (b)........ 4,000,000 4,000,719
Triborough Bridge and Tunnel Authority, Special Obligation, VRDN
2.75% (Insured; FGIC) (a)............................................... 5,000,000 5,000,000
Westchester County, TAN 2.75%, 12/15/94..................................... 7,000,000 7,002,515
------------
TOTAL INVESTMENTS (cost $137,574,112)....................................... $137,574,112
============
</TABLE>
<TABLE>
SUMMARY OF ABBREVIATIONS
<S> <C> <C> <C>
FGIC Financial Guaranty Insurance Corporation PCR Pollution Control Revenue
GIC Guaranty Investment Contract RAN Revenue Anticipation Notes
GO General Obligation RRR Resources Recovery Revenue
IDR Industrial Development Revenue SBPA Standby Bond Purchase Agreeement
LOC Letter of Credit TAN Tax Anticipation Notes
MBIA Municipal Bond Insurance Association VRDN Variable Rate Demand Notes
MFMR Multi-Family Mortgage Revenue
</TABLE>
<TABLE>
SUMMARY OF COMBINED RATINGS (UNAUDITED)
FITCH (C) OR MOODY'S OR STANDARD & POOR'S PERCENTAGE OF VALUE
- --------- --------- -------------------- -----------------------
<S> <C> <C> <C>
F1+/F1 VMIG1/MIG1, P1 (d) SP1+/SP1, A1+/A1 (d) 91.4%
AAA/AA (e) Aaa/Aa (e) AAA/AA (e) 3.5
Not Rated (f) Not Rated (f) Not Rated (f) 5.1
------
100.0%
======
</TABLE>
NOTES TO STATEMENT OF INVESTMENTS:
(a) Securities payable on demand. The interest rate, which is subject to
change, is based upon bank prime rates or an index of market interest
rates.
(b) Secured by letters of credit. At July 31, 1994, 55.3% of the Fund's
net assets are backed by letters of credit issued by domestic banks,
foreign banks and brokerage firms.
(c) Fitch currently provides creditworthiness information for a limited
number of investments.
(d) P1 and A1 are the highest ratings assigned tax-exempt commercial
paper by Moody's and Standard & Poor's, respectively.
(e) Notes which are not F, MIG or SP rated are represented by bond
ratings of the issuers.
(f) Securities which, while not rated by Fitch, Moody's or Standard &
Poor's have been determined by the Fund's Board of Trustees to be of
comparable quality to those rated securities in which the Fund may
invest.
See notes to financial statements.
<TABLE>
DREYFUS NEW YORK MUNICIPAL CASH MANAGEMENT
STATEMENT OF ASSETS AND LIABILITIES JULY 31, 1994
<S> <C> <C>
ASSETS:
Investments in securities, at value-Note 1(a)........................... $137,574,112
Interest receivable..................................................... 717,240
Prepaid expenses........................................................ 4,232
------------
138,295,584
LIABILITIES:
Due to The Dreyfus Corporation.......................................... $ 34,198
Due to Custodian........................................................ 2,182,287 2,216,485
------------ ------------
NET ASSETS ................................................................ $136,079,099
============
REPRESENTED BY:
Paid-in capital......................................................... $136,083,761
Accumulated net realized (loss) on investments.......................... (4,662)
------------
NET ASSETS at value......................................................... $136,079,099
============
Shares of Beneficial Interest outstanding:
Class A Shares
(unlimited number of $.001 par value shares authorized)............... 82,757,834
============
Class B Shares
(unlimited number of $.001 par value shares authorized)............... 53,325,927
============
NET ASSET VALUE per share:
Class A Shares
($82,754,837 / 82,757,834 shares)..................................... $1.00
=====
Class B Shares
($53,324,262 / 53,325,927 shares)..................................... $1.00
=====
See notes to financial statements.
</TABLE>
<TABLE>
DREYFUS NEW YORK MUNICIPAL CASH MANAGEMENT
STATEMENT OF OPERATIONS YEAR ENDED JULY 31, 1994
<S> <C> <C>
INVESTMENT INCOME:
INTEREST INCOME......................................................... $3,137,252
EXPENSES:
Management fee-Note 2(a).............................................. $261,339
Distribution fees (Class B shares)-Note 2(b).......................... 40,491
Shareholder servicing costs-Note 2(c)................................. 27,394
Legal fees............................................................ 13,838
Prospectus and shareholders' reports.................................. 8,177
Custodian fees........................................................ 5,676
Registration fees..................................................... 2,553
Trustees' fees and expenses-Note 2(d)................................. 1,918
Auditing fees......................................................... 1,565
Miscellaneous......................................................... 7,284
----------
370,235
Less-reduction in management fee due
to undertaking-Note 2(a).......................................... 68,405
----------
TOTAL EXPENSES........................................................ 301,830
------------
INVESTMENT INCOME-NET....................................................... 2,835,422
NET REALIZED (LOSS) ON INVESTMENTS-Note 1(b)................................ (3,972)
------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS........................ $2,831,450
============
See notes to financial statements.
</TABLE>
<TABLE>
DREYFUS NEW YORK MUNICIPAL CASH MANAGEMENT
STATEMENT OF CHANGES IN NET ASSETS
YEAR ENDED JULY 31,
---------------------------
1993 1994
------------ ------------
<S> <C> <C>
OPERATIONS:
Investment income-net................................................... $ 2,225,395 $ 2,835,422
Net realized (loss) on investments...................................... (135) (3,972)
Net unrealized (depreciation) on investments
for the year.......................................................... (236) ---
------------ ------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS.............. 2,225,024 2,831,450
------------ ------------
DIVIDENDS TO SHAREHOLDERS FROM;
Investment income--net:
Class A Shares........................................................ (2,225,395) (2,492,078)
Class B Shares........................................................ --- (343,344)
------------ ------------
TOTAL DIVIDENDS................................................... (2,225,395) (2,835,422)
------------ ------------
BENEFICIAL INTEREST TRANSACTIONS ($1.00 per share):
Net proceeds from shares sold:
Class A shares........................................................ 448,998,173 491,336,951
Class B shares........................................................ --- 92,810,600
Dividends reinvested:
Class A shares........................................................ 188,530 212,107
Class B shares........................................................ --- 77,110
Cost of shares redeemed:
Class A shares........................................................ (409,489,394) (525,319,271)
Class B shares........................................................ --- (39,561,783)
------------ ------------
INCREASE IN NET ASSETS FROM BENEFICIAL INTEREST TRANSACTIONS...... 39,697,309 19,555,714
------------ ------------
TOTAL INCREASE IN NET ASSETS.................................... 39,696,938 19,551,742
NET ASSETS:
Beginning of year....................................................... 76,830,419 116,527,357
------------ ------------
End of year............................................................. $116,527,357 $136,079,099
============ ============
See notes to financial statements.
</TABLE>
DREYFUS NEW YORK MUNICIPAL CASH MANAGEMENT
FINANCIAL HIGHLIGHTS
Reference is made to page 4 of the Fund's prospectus dated November 28, 1994.
See notes to financial statements.
DREYFUS NEW YORK MUNICIPAL CASH MANAGEMENT
NOTES TO FINANCIAL STATEMENTS
NOTE 1-SIGNIFICANT ACCOUNTING POLICIES:
The Fund is registered under the Investment Company Act of 1940 ("Act")
as a non-diversified open-end management investment company. Dreyfus Service
Corporation acted as the distributor of the Fund's shares until August 24,
1994, which are sold to the public without a sales load. Dreyfus Service
Corporation is a wholly-owned subsidiary of The Dreyfus Corporation ("
Manager"). Effective August 24, 1994, the Manager became a direct subsidiary
of Mellon Bank, N.A.
On August 24, 1994, Premier Mutual Fund Services Inc. ("Premier") was
engaged as the Fund's distributor. Premier, located at One Exchange Place,
Boston, Massachusetts 02109, is a wholly-owned subsidiary of Institutional
Administration Services, Inc., a provider of mutual fund administration
services, the parent company of which is Boston Institutional Group, Inc.
It is the Fund's policy to maintain a continuous net asset value per
share of $1.00; the Fund has adopted certain investment, portfolio valuation
and dividend and distribution policies to enable it to do so.
On July 14, 1993, the Fund's Board of Trustees approved an amendment to
the Fund's Agreement and Declaration of Trust to provide for the issuance of
additional classes of shares of the Fund. The amendment was approved by Fund
shareholders on January 13, 1994. Effective January 18, 1994, existing Fund
shares were classified as class A shares and unlimited number of Class B
shares were authorized. The Fund began offering both Class A and Class B
shares on January 18, 1994. Class B shares are subject to a Service Plan
adopted pursuant to Rule 12b-1 under the Act. Other differences between the
two Classes include the services offered to and the expenses borne by each
Class and certain voting rights.
(A) PORTFOLIO VALUATION: Investments are valued at amortized cost, which
has been determined by the Fund's Board of Trustees to represent the fair
value of the Fund's investments.
(B) SECURITIES TRANSACTIONS AND INVESTMENT INCOME: Securities
transactions are recorded on a trade date basis. Interest income, adjusted
for amortization of premiums and, original issue discount on investments, is
earned from settlement date and recognized on the accrual basis. Realized
gain and loss from securities transactions are recorded on the identified
cost basis.
The Fund follows an investment policy of investing primarily in municipal
obligations of one state. Economic changes affecting the state and certain of
its public bodies and municipalities may affect the ability of issuers within
the state to pay interest on, or repay principal of, municipal obligations
held by the Fund.
(C) DIVIDENDS TO SHAREHOLDERS: It is the policy of the Fund to declare
dividends daily from investment income-net. Such dividends are paid monthly.
Dividends from net realized capital gain, if any, are normally declared and
paid annually, but the Fund may make distributions on a more frequent basis
to comply with the distribution requirements of the Internal Revenue Code. To
the extent that net realized capital gain can be offset by capital loss
carryovers, it is the policy of the Fund not to distribute such gain.
(D) FEDERAL INCOME TAXES: It is the policy of the Fund to continue to
qualify as a regulated investment company, which can distribute tax exempt
dividends, by complying with the applicable provisions of the Internal
Revenue Code, and to make distributions of income and net realized capital
gain sufficient to relieve it from substantially all Federal income taxes.
DREYFUS NEW YORK MUNICIPAL CASH MANAGEMENT
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
The Fund has an unused capital loss carryover of $690 available for
Federal income tax purposes to be applied against future net securities
profits, if any, realized subsequent to July 31, 1994. The carryover does not
include net realized securities losses from November 1, 1993 through July 31,
1994 which are treated, for Federal income tax purposes, as arising in fiscal
1995. If not applied, $555 of the carryover expires in fiscal 2001 and $135
expires in fiscal 2002.
At July 31, 1994, the cost of investments for Federal income tax purposes
was substantially the same as the cost for financial reporting purposes (see
the Statement of Investments).
NOTE 2-MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATES:
(A) Pursuant to a management agreement ("Agreement") with the Manager,
the management fee is computed at the annual rate of .20 of 1% of the average
daily value of the Fund's net assets and is payable monthly.
The Agreement provides for an expense reimbursement from the Manager
should the Fund's aggregate expenses, exclusive of taxes, brokerage, interest
on borrowings and extraordinary expenses, exceed the expense limitation of
any state having jurisdiction over the Fund for any full fiscal year. The
most stringent state expense limitation applicable to the Fund presently
requires reimbursement of expenses in any full fiscal year that such expenses
(excluding certain expenses as described above) exceed 2 1/2% of the first
$30 million, 2% of the next $70 million and 1 1/2% of the excess over $100
million of the average value of the Fund's net assets in accordance with
California "blue sky" regulations. However, the Manager has undertaken to
reduce the management fee paid by, or bear such excess expenses of the Fund,
to the extent that the Fund's aggregate expenses (excluding certain expenses
as described above) exceed an annual rate of .20 of 1% of the average daily
value of the Fund's net assets. The reduction in management fee, pursuant to
the undertaking, amounted to $68,405 from August 1, 1993 through January 17,
1994.
Effective January 18, 1994, the Manager and not the Fund, is liable for
those expenses of the Fund (excluding certain expenses as described above)
other than management fee, and with respect to the Fund's Class B shares,
Rule 12b-1 Service Plan expenses.
The Manager may modify the existing undertaking provided that the Fund's
shareholders are given 90 days prior notice.
(B) Under the Service Plan ("Class B Service Plan") adopted pursuant to
Rule 12b-1 under the Act, effective January 18, 1994, the Fund pays Dreyfus
Service Corporation, at an annual rate of .25 of 1% of the value of the
Fund's Class B shares average daily net assets, for costs and expenses in
connection with advertising, marketing and distributing Class B shares and
for providing certain services to holders of Class B shares. Dreyfus Service
Corporation will make payments to one or more Service Agents (financial
institutions, securities dealers, or other industry professional) based on
the value of the Fund's Class B shares owned by clients of the Service Agent.
From January 18, 1994 through July 31, 1994, $40,491 was charged to the Fund,
pursuant to the Class B Service Plan.
DREYFUS NEW YORK MUNICIPAL CASH MANAGEMENT
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
(C) Pursuant to the Fund's Shareholder Services Plan, ("Class A
Shareholder Services Plan"), the Fund reimburses Dreyfus Service Corporation
an amount not to exceed an annual rate of .25 of 1% of the value of the Fund's
average daily net assets for servicing shareholder accounts. The services
provided may include personal services relating to shareholder accounts, such
as answering shareholder inquiries regarding the Fund and providing reports
and other information, and services related to the maintenance of shareholder
accounts. During the period from August 1, 1993 through January 17, 1994, the
Fund was charged an aggregate of $4,897 pursuant to the Class A Shareholder
Services Plan.
(D) Certain officers and trustees of the Fund are "affiliated persons,"
as defined in the Act, of the Manager and/or Dreyfus Service Corporation.
Each trustee who is not an "affiliated person" receives an annual fee of
$1,000 and an attendance fee of $250 per meeting.
DREYFUS NEW YORK MUNICIPAL CASH MANAGEMENT
REPORT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
SHAREHOLDERS AND BOARD OF TRUSTEES
DREYFUS NEW YORK MUNICIPAL CASH MANAGEMENT
We have audited the accompanying statement of assets and liabilities of
Dreyfus New York Municipal Cash Management, including the statement of
investments, as of July 31, 1994, and the related statement of operations for
the year then ended, the statement of changes in net assets for each of the
two years in the period then ended, and financial highlights for each of the
years indicated therein. These financial statements and financial highlights
are the responsibility of the Fund's management. Our responsibility is to
express an opinion on these financial statements and financial highlights
based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements and
financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures
in the financial statements. Our procedures included confirmation of
securities owned as of July 31, 1994 by correspondence with the custodian. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements and financial highlights
referred to above present fairly, in all material respects, the financial
position of Dreyfus New York Municipal Cash Management at July 31, 1994, the
results of its operations for the year then ended, the changes in its net
assets for each of the two years in the period then ended, and the financial
highlights for each of the indicated years, in conformity with generally
accepted accounting principles.
(ERNST & YOUNG LLP, Signature Logo)
New York, New York
September 8, 1994
DREYFUS NEW YORK MUNICIPAL CASH MANAGEMENT
PART C. OTHER INFORMATION
_________________________
Item 24. Financial Statements and Exhibits - List
(a) Financial Statements:
Included in Part A of the Registration Statement:
Condensed Financial Information, with respect to Class A
shares, for the period from November 4, 1991 (commencement
of operations) to July 31, 1992 and for the two fiscal years
ended July 31, 1994 and, with respect to Class B shares, for
the period from January 18, 1994 (commencement of initial
offering) to July 31, 1994.
Included in Part B of the Registration Statement:
Statement of Investments-- July 31, 1994.
Statement of Assets and Liabilities-- July 31, 1994.
Statement of Operations-- year ended July 31, 1994.
Statement of Changes in Net Assets--for the years ended
July 31, 1993 and July 31, 1994.
Notes to Financial Statements.
Report of Ernst & Young LLP, Independent Auditors,
dated September 8, 1994.
Schedule Nos. I through VII and other financial statement information, for
which provision is made in the applicable accounting regulations of the
Securities and Exchange Commission, are either omitted because they are not
required under the related instructions, they are inapplicable, or the
required information is presented in the financial statements or notes
which are included in Part B of the Registration Statement.
Item 24. Financial Statements and Exhibits - List (continued)
(b) Exhibits:
(1) Registrant's Amended and Restated Agreement and Declaration of
Trust is incorporated by reference to Exhibit (1) of Post-
Effective No. 4 to the Registration Statement on Form N-1A, filed
on September 30, 1993.
(2) Registrant's By-Laws are incorporated by reference to Exhibit (2)
of Pre-Effective Amendment No. 1 to the Registration Statement
on Form N-1A, filed on October 7, 1991.
(4) Specimen certificate for the Registrant's securities is
incorporated by reference to Exhibit (4) of Pre-Effective
Amendment No. 1 to the Registration Statement on Form N-1A, filed
on October 7, 1991.
(5) Management Agreement.
(6) Distribution Agreement.
(8)(a) Custody Agreement is incorporated by reference to Exhibit 8(a) of
Pre-Effective Amendment No. 1 to the Registration Statement on
Form N-1A, filed on October 7, 1991.
(8)(b) Forms of Sub-Custodian Agreements are incorporated by reference
to Exhibit 8(b) of Pre-Effective Amendment No. 1 to the
Registration Statement on Form N-1A, filed on October 7, 1991.
(9) Shareholder Services Plan is incorporated by reference to Exhibit
(9) of Post-Effective Amendment No. 3 to the Registration
Statement on Form N-1A, filed on August 26, 1993.
(10) Opinion and consent of Registrant's counsel is incorporated by
reference to Exhibit (10) of Pre-Effective Amendment No. 1 to the
Registration Statement on Form N-1A, filed on October 7, 1991.
(11) Consent of Independent Auditors.
(15) Service Plan.
(16) Schedule of Computation of Performance Data for Class A and Class
B shares.
Item 24. Financial Statements and Exhibits - List (continued)
_____________________________________________________
Other Exhibits
______________
(a) Power of Attorney of the Directors.
(b) Power of Attorney of the Officers.
(b) Certificate of Assistant Secretary.
Item 25. Persons Controlled by or under Common Control with Registrant
Not Applicable
Item 26. Number of Holders of Securities
(1) (2)
Number of Record
Title of Class Holders as of September 16, 1994
Shares of beneficial
interest (par value $.001)
Class A. . . . . . . . . . . . . . . . . . . 548
Class B. . . . . . . . . . . . . . . . . . . 7
Item 27. Indemnification
The Statement as to the general effect of any contract,
arrangements or statute under which a trustee, officer,
underwriter or affiliated person of the Registrant is indemnified
is incorporated by reference to Item 27 of Part C of Pre-Effective
Amendment No. 1 to the Registration Statement on Form N-1A, filed
on October 7, 1991.
Reference is also made to the Distribution Agreement filed as
Exhibit 6 hereto.
Item 28. Business and Other Connections of Investment Adviser
The Dreyfus Corporation ("Dreyfus") and subsidiary companies
comprise a financial service organization whose business consists
primarily of providing investment management services as the
investment adviser, manager and distributor for sponsored
investment companies registered under the Investment Company Act
of 1940 and as an investment adviser to institutional and
individual accounts. Dreyfus also serves as sub-investment
adviser to and/or administrator of other investment companies.
Premier Mutual Fund Services, Inc. serves primarily as distributor
of shares of investment companies sponsored by Dreyfus and of
other investment companies for which Dreyfus acts as investment
adviser, sub-investment adviser or administrator. Dreyfus
Management, Inc., another wholly-owned subsidiary, provides
investment management services to various pension plans,
institutions and individuals.
Item 28. Business and Other Connections of Investment Adviser (continued)
________ ________________________________________________________________
Officers and Directors of Investment Adviser
____________________________________________
Name and Position
with Dreyfus Other Businesses
_________________ ________________
MANDELL L. BERMAN Real estate consultant and private investor
Director 29100 Northwestern Highway, Suite 370
Southfield, Michigan 48034;
Past Chairman of the Board of Trustees of
Skillman Foundation.
Member of The Board of Vintners Intl.
FRANK CAHOUET Chairman of the Board, President and
Director Chief Executive Officer:
Mellon Bank Corporation
One Mellon Bank Center
Pittsburgh, Pennsylvania 15258;
Mellon Bank, N.A.
One Mellon Bank Center
Pittsburgh, Pennsylvania 15258
Director:
Avery Dennison Corporation
150 North Orange Grove Boulevard
Pasadena, California 91103;
Saint-Gobain Corporation
750 East Swedesford Road
Valley Forge, Pennsylvania 19482;
Teledyne, Inc.
1901 Avenue of the Stars
Los Angeles, California 90067
ALVIN E. FRIEDMAN Senior Adviser to Dillon, Read & Co. Inc.
Director 535 Madison Avenue
New York, New York 10022;
Director and member of the Executive
Committee of Avnet, Inc.**
ABIGAIL Q. McCARTHY Author, lecturer, columnist and educational
Director consultant
2126 Connecticut Avenue
Washington, D.C. 20008
DAVID B. TRUMAN Educational consultant;
Director Past President of the Russell Sage Foundation
230 Park Avenue
New York, New York 10017;
Past President of Mount Holyoke College
South Hadley, Massachusetts 01075;
Former Director:
Student Loan Marketing Association
1055 Thomas Jefferson Street, N.W.
Washington, D.C. 20006;
DAVID B. TRUMAN Former Trustee:
(cont'd) College Retirement Equities Fund
730 Third Avenue
New York, New York 10017
HOWARD STEIN Chairman of the Board:
Chairman of the Board and Dreyfus Acquisition Corporation*;
Chief Executive Officer The Dreyfus Consumer Credit
Corporation*;
Dreyfus Land Development Corporation*;
Dreyfus Management, Inc.*;
Dreyfus Service Corporation*;
Chairman of the Board and Chief Executive
Officer:
Major Trading Corporation*;
Director:
Avnet, Inc.**;
Dreyfus America Fund++++
The Dreyfus Fund International
Limited+++++
World Balanced Fund+++
Dreyfus Partnership Management,
Inc.*;
Dreyfus Personal Management, Inc.*;
Dreyfus Precious Metals, Inc.*;
Dreyfus Realty Advisors, Inc.+++;
Dreyfus Service Organization, Inc.*;
The Dreyfus Trust Company++;
Seven Six Seven Agency, Inc.*;
Trustee:
Corporate Property Investors
New York, New York;
JULIAN M. SMERLING Director and Executive Vice President:
Vice Chairman of the Dreyfus Service Corporation*;
Board of Directors Director and Vice President:
Dreyfus Service Organization, Inc.*;
Vice Chairman and Director:
The Dreyfus Trust Company++;
The Dreyfus Trust Company (N.J.)++;
Director:
The Dreyfus Consumer Credit
Corporation*;
Dreyfus Partnership Management, Inc.*;
Seven Six Seven Agency, Inc.*
JOSEPH S. DiMARTINO Director and Chairman of the Board:
President, and The Dreyfus Trust Company++;
Director Director and President:
Dreyfus Acquisition Corporation*;
The Dreyfus Consumer Credit
Corporation*;
Dreyfus Partnership Management, Inc.*;
The Dreyfus Trust Company (N.J.)++;
Director and Executive Vice President:
Dreyfus Service Corporation*;
Director and Vice President:
Dreyfus Service Organization, Inc.*;
JOSEPH S. DiMARTINO Director:
(cont'd) Dreyfus Management, Inc.*;
Dreyfus Personal Management, Inc.*;
Noel Group, Inc.
667 Madison Avenue
New York, New York 10021;
Trustee:
Bucknell University
Lewisburg, Pennsylvania 17837;
Vice President and former Treasurer and
Director:
National Muscular Dystrophy Association
810 Seventh Avenue
New York, New York 10019;
President, Chief Operating Officer and
Director:
Major Trading Corporation*
W. KEITH SMITH Chairman and Chief Executive Officer:
Chief Operating Officer The Boston Company
One Boston Place
Boston, Massachusetts 02108
Vice Chairman of the Board:
Mellon Bank Corporation
One Mellon Bank Center
Pittsburgh, Pennsylvania 15258;
Mellon Bank, N.A.
One Mellon Bank Center
Pittsburgh, Pennsylvania 15258
Director:
Dentsply International, Inc.
570 West College Avenue
York, Pennsylvania 17405
PAUL H. SNYDER Director:
Vice President and Chief Pennsylvania Economy League
Financial Officer Philadelphia, Pennsylvania;
Children's Crisis Treatment Center
Philadelphia, Pennsylvania;
Director and Vice President:
Financial Executives Institute,
Philadelphia Chapter
Philadelphia, Pennsylvania;
LAWRENCE S. KASH Chairman, President and Chief
Vice Chairman, Distribution Executive Officer:
The Boston Company Advisors, Inc.
53 State Street
Exchange Place
Boston, Massachusetts 02109
President:
The Boston Company
One Boston Place
Boston, Massachusetts 02108;
Laurel Capital Advisors
One Mellon Bank Center
Pittsburgh, Pennsylvania 15258;
Boston Group Holdings, Inc.
LAWRENCE S. KASH Executive Vice President
(cont'd) Mellon Bank, N.A.
One Mellon Bank Center
Pittsburgh, Pennsylvania 15258;
Boston Safe Deposit & Trust
One Boston Place
Boston, Massachusetts 02108
JAY R. DIMARTINE Chairman of the Board and President:
Vice President, Marketing The Woodbury Society
16 Woodbury Lane
Ogunquit, ME 03907;
Former Managing Director:
Bankers Trust Company
280 Park Avenue
New York, NY 10017;
BARBARA E. CASEY President:
Vice President, Dreyfus Retirement Services;
Retirement Services Executive Vice President:
Boston Safe Deposit & Trust Co.
One Boston Place
Boston, Massachusetts 02108;
DIANE M. COFFEY None
Vice President,
Corporate Communications
LAWRENCE M. GREENE Chairman of the Board:
Legal Consultant and The Dreyfus Security Savings
Director Bank, F.S.B.+;
Director and Executive Vice President:
Dreyfus Service Corporation*;
Director and Vice President:
Dreyfus Acquisition Corporation*;
Dreyfus Service Organization, Inc.*;
Director:
Dreyfus-Lincoln, Inc.*;
Dreyfus Management, Inc.*;
Dreyfus Precious Metals, Inc.*;
Dreyfus Thrift & Commerce+++;
The Dreyfus Trust Company (N.J.)++;
Seven Six Seven Agency, Inc.*;
ROBERT F. DUBUSS Director and Treasurer:
Vice President Major Trading Corporation*;
Director and Vice President:
The Dreyfus Consumer Credit
Corporation*;
The Truepenny Corporation*;
Treasurer:
Dreyfus Management, Inc.*;
Dreyfus Precious Metals, Inc.*;
Dreyfus Service Corporation*;
Director:
The Dreyfus Trust Company++;
The Dreyfus Trust Company (N.J.)++;
Dreyfus Thrift & Commerce****
ELIE M. GENADRY President:
Vice President, Institutional Services Division of
Dreyfus
Wholesale Service Corporation*;
Broker-Dealer Division of Dreyfus
Service
Corporation*;
Group Retirement Plans Division of
Dreyfus
Service Corporation;
Executive Vice President:
Dreyfus Service Corporation*;
Dreyfus Service Organization, Inc.*;
Vice President:
The Dreyfus Trust Company++;
Vice President-Sales:
The Dreyfus Trust Company (N.J.)++;
DANIEL C. MACLEAN Director, Vice President and Secretary:
Vice President and General Dreyfus Precious Metals, Inc.*;
Counsel Director and Vice President:
The Dreyfus Consumer Credit
Corporation*;
The Dreyfus Trust Company (N.J.)++;
Director and Secretary:
Dreyfus Partnership Management, Inc.*;
Major Trading Corporation*;
The Truepenny Corporation+;
Director:
The Dreyfus Trust Company++;
Secretary:
Seven Six Seven Agency, Inc.*;
JEFFREY N. NACHMAN None
Vice President, Fund
Administration
PETER A. SANTORIELLO Director and President
Vice President Dreyfus Management, Inc.*;
Vice President:
Dreyfus Personal Management, Inc.*
KIRK V. STUMPP Senior Vice President and
Vice President - Director of Marketing:
New Product Development Dreyfus Service Corporation*
PHILIP L. TOIA Chairman of the Board and Vice President:
Vice Chairman, Operations Dreyfus Thrift & Commerce****;
and Administration Director:
The Dreyfus Security Savings Bank
F.S.B.+;
Senior Loan Officer and Director:
The Dreyfus Trust Company++;
Vice President:
The Dreyfus Consumer Credit
Corporation*;
President and Director:
Dreyfus Personal Management, Inc.*;
Director:
Dreyfus Realty Advisors, Inc.+++;
Formerly, Senior Vice President:
The Chase Manhattan Bank, N.A. and
The Chase Manhattan Capital Markets
Corporation
PHILIP L. TOIA One Chase Manhattan Plaza
(Cont'd) New York, New York 10081
KATHERINE C. WICKHAM Formerly, Assistant Commissioner:
Vice President, Department of Parks and Recreation of the
Human Resources City of New York
830 Fifth Avenue
New York, New York 10022
MAURICE BENDRIHEM Treasurer:
Controller Dreyfus Partnership Management, Inc.*;
Dreyfus Service Organization, Inc.*;
Seven Six Seven Agency, Inc.*;
The Truepenny Corporation*;
Controller:
Dreyfus Acquisition Corporation*;
The Dreyfus Trust Company++;
The Dreyfus Trust Company (N.J.)++;
The Dreyfus Consumer Credit
Corporation*;
Assistant Treasurer:
Dreyfus Precious Metals*
Formerly, Vice President-Financial Planning,
Administration and Tax:
Showtime/The Movie Channel, Inc.
1633 Broadway
New York, New York 10019
MARK N. JACOBS Secretary:
Vice President, Fund The Dreyfus Consumer Credit
Legal and Compliance Corporation*; Dreyfus Management,
Inc.*;
Assistant Secretary:
Dreyfus Service Organization, Inc.*;
Major Trading Corporation*;
The Truepenny Corporation*
CHRISTINE PAVALOS Assistant Secretary:
Assistant Secretary Dreyfus Management, Inc.*;
Dreyfus Service Corporation*;
The Truepenny Corporation*
______________________________________
* The address of the business so indicated is 200 Park Avenue, New
York, New York 10166.
** The address of the business so indicated is 80 Cutter Mill Road,
Great Neck, New York 11021.
*** The address of the business so indicated is 45 Broadway, New York,
New York 10006.
**** The address of the business so indicated is Five Triad Center, Salt
Lake City, Utah 84180.
+ The address of the business so indicated is Atrium Building, 80
Route 4 East, Paramus, New Jersey 07652.
++ The address of the business so indicated is 144 Glenn Curtiss
Boulevard, Uniondale, New York 11556-0144.
+++ The address of the business so indicated is One Rockefeller Plaza,
New York, New York 10020.
++++ The address of the business so indicated is 2 Boulevard Royal,
Luxembourg.
+++++ The address of the business so indicated is Nassau, Bahama Islands.
Item 29. Principal Underwriters
________ ______________________
(a) Other investment companies for which Registrant's principal
underwriter (exclusive distributor) acts as principal underwriter or
exclusive distributor:
1) Comstock Partners Strategy Fund, Inc.
2) Dreyfus A Bonds Plus, Inc.
3) Dreyfus Appreciation Fund, Inc.
4) Dreyfus Asset Allocation Fund, Inc.
5) Dreyfus Balanced Fund, Inc.
6) Dreyfus BASIC Money Market Fund, Inc.
7) Dreyfus BASIC Municipal Money Market Fund, Inc.
8) Dreyfus BASIC U.S. Government Money Market Fund
9) Dreyfus California Intermediate Municipal Bond Fund
10) Dreyfus California Tax Exempt Bond Fund, Inc.
11) Dreyfus California Tax Exempt Money Market Fund
12) Dreyfus Capital Value Fund, Inc.
13) Dreyfus Cash Management
14) Dreyfus Cash Management Plus, Inc.
15) Dreyfus Connecticut Intermediate Municipal Bond Fund
16) Dreyfus Connecticut Municipal Money Market Fund, Inc.
17) The Dreyfus Convertible Securities Fund, Inc.
18) Dreyfus Edison Electric Index Fund, Inc.
19) Dreyfus Florida Intermediate Municipal Bond Fund
20) Dreyfus Florida Municipal Money Market Fund
21) Dreyfus Focus Funds, Inc.
22) The Dreyfus Fund Incorporated
23) Dreyfus Global Bond Fund, Inc.
24) Dreyfus Global Growth, L.P. (A Strategic Fund)
25) Dreyfus Global Investing, Inc.
26) Dreyfus GNMA Fund, Inc.
27) Dreyfus Government Cash Management
28) Dreyfus Growth and Income Fund, Inc.
29) Dreyfus Growth Opportunity Fund, Inc.
30) Dreyfus Institutional Money Market Fund
31) Dreyfus Institutional Short Term Treasury Fund
32) Dreyfus Insured Municipal Bond Fund, Inc.
33) Dreyfus Intermediate Municipal Bond Fund, Inc.
34) Dreyfus International Equity Fund, Inc.
35) Dreyfus Investors GNMA Fund
36) The Dreyfus Leverage Fund, Inc.
37) Dreyfus Life and Annuity Index Fund, Inc.
38) Dreyfus Liquid Assets, Inc.
39) Dreyfus Massachusetts Intermediate Municipal Bond Fund
40) Dreyfus Massachusetts Municipal Money Market Fund
41) Dreyfus Massachusetts Tax Exempt Bond Fund
42) Dreyfus Michigan Municipal Money Market Fund, Inc.
43) Dreyfus Money Market Instruments, Inc.
44) Dreyfus Municipal Bond Fund, Inc.
45) Dreyfus Municipal Cash Management Plus
46) Dreyfus Municipal Money Market Fund, Inc.
47) Dreyfus New Jersey Intermediate Municipal Bond Fund
48) Dreyfus New Jersey Municipal Bond Fund, Inc.
49) Dreyfus New Jersey Municipal Money Market Fund, Inc.
50) Dreyfus New Leaders Fund, Inc.
51) Dreyfus New York Insured Tax Exempt Bond Fund
52) Dreyfus New York Tax Exempt Bond Fund, Inc.
53) Dreyfus New York Tax Exempt Intermediate Bond Fund
54) Dreyfus New York Tax Exempt Money Market Fund
55) Dreyfus Ohio Municipal Money Market Fund, Inc.
56) Dreyfus 100% U.S. Treasury Intermediate Term Fund
57) Dreyfus 100% U.S. Treasury Long Term Fund
58) Dreyfus 100% U.S. Treasury Money Market Fund
59) Dreyfus 100% U.S. Treasury Short Term Fund
60) Dreyfus Pennsylvania Intermediate Municipal Bond Fund
61) Dreyfus Pennsylvania Municipal Money Market Fund
62) Dreyfus Short-Intermediate Government Fund
63) Dreyfus Short-Intermediate Municipal Bond Fund
64) Dreyfus Short-Term Income Fund, Inc.
65) The Dreyfus Socially Responsible Growth Fund, Inc.
66) Dreyfus Strategic Growth, L.P.
67) Dreyfus Strategic Income
68) Dreyfus Strategic Investing
69) Dreyfus Tax Exempt Cash Management
70) The Dreyfus Third Century Fund, Inc.
71) Dreyfus Treasury Cash Management
72) Dreyfus Treasury Prime Cash Management
73) Dreyfus Variable Investment Fund
74) Dreyfus-Wilshire Target Funds, Inc.
75) Dreyfus Worldwide Dollar Money Market Fund, Inc.
76) First Prairie Cash Management
77) First Prairie Diversified Asset Fund
78) First Prairie Money Market Fund
79) First Prairie Municipal Money Market Fund
80) First Prairie Tax Exempt Bond Fund, Inc.
81) First Prairie U.S. Government Income Fund
82) First Prairie U.S. Treasury Securities Cash Management
83) General California Municipal Bond Fund, Inc.
84) General California Municipal Money Market Fund
85) General Government Securities Money Market Fund, Inc.
86) General Money Market Fund, Inc.
87) General Municipal Bond Fund, Inc.
88) General Municipal Money Market Fund, Inc.
89) General New York Municipal Bond Fund, Inc.
90) General New York Municipal Money Market Fund
91) Pacific American Fund
92) Peoples Index Fund, Inc.
93) Peoples S&P MidCap Index Fund, Inc.
94) Premier Insured Municipal Bond Fund
95) Premier California Municipal Bond Fund
96) Premier GNMA Fund
97) Premier Growth Fund, Inc.
98) Premier Municipal Bond Fund
99) Premier New York Municipal Bond Fund
100) Premier State Municipal Bond Fund
(b)
Positions and
Name and principal Positions and offices with offices with
business address Premier Mutual Fund Services, Inc. Registrant
__________________ __________________________________ _____________
Marie E. Connolly Director, President and Chief President and
Operating Officer Treasurer
Joseph F. Tower, III Senior Vice President and Chief Assistant
Financial Officer Treasurer
John E. Pelletier Senior Vice President and General Secretary
Counsel
Frederick C. Dey Senior Vice President Assistant
Treasurer
Eric B. Fischman Vice President and Associate Assistant
General Counsel Secretary
Jean M. O'Leary Assistant Secretary None
Ruth D. Leibert Assistant Vice President Assistant
Secretary
Paul D. Furcinito Assistant Vice President None
John W. Gomez Director None
William J. Nutt Director None
Item 30. Location of Accounts and Records
________________________________
1. The Shareholder Services Group, Inc.,
a subsidiary of First Data Corporation
P.O. Box 9671
Providence, Rhode Island 02940-9671
2. The Bank of New York
110 Washington Street
New York, New York 10286
3. The Dreyfus Corporation
200 Park Avenue
New York, New York 10166
Item 31. Management Services
_______ ___________________
Not Applicable
Item 32. Undertakings
________ ____________
(1) To call a meeting of shareholders for the purpose of voting upon
the question of removal of a trustee(s) when requested in writing
to do so by the holders of at least 10% of the Registrant's
outstanding shares of beneficial interest and in connection with
such meeting to comply with the provisions of Section 16(c) of
the Investment Company Act of 1940 relating to shareholder
communications.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant certifies that it meets all
of the requirements for effectiveness of this Amendment to the Registration
Statement pursuant to Rule 485(a) under the Securities Act of 1933 and has
duly caused this Amendment to the Registration Statement to be signed on
its behalf by the undersigned, thereunto duly authorized, in the City of
New York, and State of New York on the 29 day of September, 1994.
DREYFUS NEW YORK MUNICIPAL CASH MANAGEMENT
BY: /s/Marie E. Connolly*
Marie E. Connolly, President
Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, this Amendment to the Registration
Statement has been signed below by the following persons in the capacities
and on the date indicated.
Signatures Title Date
/s/Marie E. Connolly* President (Principal Executive 9/29/94
Marie E. Connolly Officer, Financial and Accounting
Officer) and Treasurer
/s/David W. Burke* Trustee 9/29/94
David W. Burke
/s/Isabel P. Dunst* Trustee 9/29/94
Isabel P. Dunst
/s/Lyle E. Gramley* Trustee 9/29/94
Lyle E. Gramley
/s/Warren B. Rudman* Trustee 9/29/94
Warren B. Rudman
BY: __________________________*
Eric B. Fischman,
Attorney-in-Fact
INDEX OF EXHIBITS
ITEM Page
(5) Management Agreement. . . . . . . . . . . . . . . . . .
(6) Distribution Agreement. . . . . . . . . . . . . . . . .
(11) Consent of Ernst & Young LLP, Independent
Auditors. . . . . . . . . . . . . . . . . . . . . . . .
(15) Service Plan. . . . . . . . . . . . . . . . . . . . . .
(16) Schedules of Computation of Performance Data for
Class A and Class B shares. . . . . . . . . . . . . . .
Other Exhibit:
(a) Power of Attorney of Directors
(b) Power of Attorney of Officers
(c) Certificate of Assistant Secretary
MANAGEMENT AGREEMENT
DREYFUS NEW YORK MUNICIPAL CASH MANAGEMENT
August 24, 1994
The Dreyfus Corporation
200 Park Avenue
New York, New York 10166
Dear Sirs:
The above-named investment company (the "Fund")
herewith confirms its agreement with you as follows:
The Fund desires to employ its capital by investing and
reinvesting the same in investments of the type and in accordance
with the limitations specified in its charter documents and in
its Prospectus and Statement of Additional Information as from
time to time in effect, copies of which have been or will be
submitted to you, and in such manner and to such extent as from
time to time may be approved by the Fund's Board. The Fund
desires to employ you to act as its investment adviser.
In this connection it is understood that from time to
time you will employ or associate with yourself such person or
persons as you may believe to be particularly fitted to assist
you in the performance of this Agreement. Such person or persons
may be officers or employees who are employed by both you and the
Fund. The compensation of such person or persons shall be paid
by you and no obligation may be incurred on the Fund's behalf in
any such respect.
Subject to the supervision and approval of the Fund's
Board, you will provide investment management of the Fund's
portfolio in accordance with the Fund's investment objectives and
policies as stated in its Prospectus and Statement of Additional
Information as from time to time in effect. In connection
therewith, you will obtain and provide investment research and
will supervise the Fund's investments and conduct a continuous
program of investment, evaluation and, if appropriate, sale and
reinvestment of the Fund's assets. You will furnish to the Fund
such statistical information, with respect to the investments
which the Fund may hold or contemplate purchasing, as the Fund
may reasonably request. The Fund wishes to be informed of
important developments materially affecting its portfolio and
shall expect you, on your own initiative, to furnish to the Fund
from time to time such information as you may believe appropriate
for this purpose.
In addition, you will supply office facilities (which
may be in your own offices), data processing services, clerical,
accounting and bookkeeping services, internal auditing and legal
services, internal executive and administrative services, and
stationery and office supplies; prepare reports to the Fund's
stockholders, tax returns, reports to and filings with the
Securities and Exchange Commission and state Blue Sky
authorities; calculate the net asset value of the Fund's shares;
and generally assist in all aspects of the Fund's operations.
You shall have the right, at your expense, to engage other
entities to assist you in performing some or all of the
obligations set forth in this paragraph, provided each such
entity enters into an agreement with you in form and substance
reasonably satisfactory to the Fund. You agree to be liable for
the acts or omissions of each such entity to the same extent as
if you had acted or failed to act under the circumstances.
You shall exercise your best judgment in rendering the
services to be provided to the Fund hereunder and the Fund agrees
as an inducement to your undertaking the same that you shall not
be liable hereunder for any error of judgment or mistake of law
or for any loss suffered by the Fund, provided that nothing
herein shall be deemed to protect or purport to protect you
against any liability to the Fund or to its security holders to
which you would otherwise be subject by reason of willful
misfeasance, bad faith or gross negligence in the performance of
your duties hereunder, or by reason of your reckless disregard of
your obligations and duties hereunder.
In consideration of services rendered pursuant to this
Agreement, the Fund will pay you on the first business day of
each month a fee at the annual rate of .20 of 1% of the value of
the Fund's average daily net assets. Net asset value shall be
computed on such days and at such time or times as described in
the Fund's then-current Prospectus and Statement of Additional
Information. Upon any termination of this Agreement before the
end of any month, the fee for such part of a month shall be pro-
rated according to the proportion which such period bears to the
full monthly period and shall be payable upon the date of
termination of this Agreement.
For the purpose of determining fees payable to you, the
value of the Fund's net assets shall be computed in the manner
specified in the Fund's charter documents for the computation of
the value of the Fund's net assets.
You will bear all expenses in connection with the
performance of your services under this Agreement. All other
expenses to be incurred in the operation of the Fund will be
borne by the Fund, except to the extent specifically assumed by
you. The expenses to be borne by the Fund include, without
limitation, the following: organizational costs, taxes,
interest, loan commitment fees, interest and distributions paid
on securities sold short, brokerage fees and commissions, if any,
fees of Board members who are not your officers, directors or
employees or holders of 5% or more of your outstanding voting
securities, Securities and Exchange Commission fees and state
Blue Sky qualification fees, advisory fees, charges of
custodians, transfer and dividend disbursing agents' fees,
certain insurance premiums, industry association fees, outside
auditing and legal expenses, costs of independent pricing
services, costs of maintaining the Fund's existence, costs
attributable to investor services (including, without limitation,
telephone and personnel expenses), costs of preparing and
printing prospectuses and statements of additional information
for regulatory purposes and for distribution to existing
stockholders, costs of stockholders' reports and meetings, and
any extraordinary expenses.
If in any fiscal year the aggregate expenses of the
Fund (including fees pursuant to this Agreement, but excluding
interest, taxes, brokerage and, with the prior written consent of
the necessary state securities commissions, extraordinary
expenses) exceed the expense limitation of any state having
jurisdiction over the Fund, the Fund may deduct from the fees to
be paid hereunder, or you will bear, such excess expense to the
extent required by state law. Your obligation pursuant hereto
will be limited to the amount of your fees hereunder. Such
deduction or payment, if any, will be estimated daily, and
reconciled and effected or paid, as the case may be, on a monthly
basis.
The Fund understands that you now act, and that from
time to time hereafter you may act, as investment adviser to one
or more other investment companies and fiduciary or other managed
accounts, and the Fund has no objection to your so acting,
provided that when the purchase or sale of securities of the same
issuer is suitable for the investment objectives of two or more
companies or accounts managed by you which have available funds
for investment, the available securities will be allocated in a
manner believed by you to be equitable to each company or
account. It is recognized that in some cases this procedure may
adversely affect the price paid or received by the Fund or the
size of the position obtainable for or disposed of by the Fund.
In addition, it is understood that the persons employed
by you to assist in the performance of your duties hereunder will
not devote their full time to such service and nothing contained
herein shall be deemed to limit or restrict your right or the
right of any of your affiliates to engage in and devote time and
attention to other businesses or to render services of whatever
kind or nature.
You shall not be liable for any error of judgment or
mistake of law or for any loss suffered by the Fund in connection
with the matters to which this Agreement relates, except for a
loss resulting from willful misfeasance, bad faith or gross
negligence on your part in the performance of your duties or from
reckless disregard by you of your obligations and duties under
this Agreement. Any person, even though also your officer,
director, partner, employee or agent, who may be or become an
officer, Board member, employee or agent of the Fund, shall be
deemed, when rendering services to the Fund or acting on any
business of the Fund, to be rendering such services to or acting
solely for the Fund and not as your officer, director, partner,
employee or agent or one under your control or direction even
though paid by you.
This Agreement shall continue until June 11, 1995, and
thereafter shall continue automatically for successive annual
periods ending on June 11th of each year, provided such
continuance is specifically approved at least annually by (i) the
Fund's Board or (ii) vote of a majority (as defined in the
Investment Company Act of 1940) of the Fund's outstanding voting
securities, provided that in either event its continuance also is
approved by a majority of the Fund's Board members who are not
"interested persons" (as defined in said Act) of any party to
this Agreement, by vote cast in person at a meeting called for
the purpose of voting on such approval. This Agreement is
terminable without penalty, on 60 days' notice, by the Fund's
Board or by vote of holders of a majority of the Fund's shares
or, upon not less than 90 days' notice, by you. This Agreement
also will terminate automatically in the event of its assignment
(as defined in said Act).
The Fund recognizes that from time to time your
directors, officers and employees may serve as directors,
trustees, partners, officers and employees of other corporations,
business trusts, partnerships or other entities (including other
investment companies) and that such other entities may include
the name "Dreyfus" as part of their name, and that your
corporation or its affiliates may enter into investment advisory
or other agreements with such other entities. If you cease to
act as the Fund's investment adviser, the Fund agrees that, at
your request, the Fund will take all necessary action to change
the name of the Fund to a name not including "Dreyfus" in any
form or combination of words.
This Agreement has been executed on behalf of the Fund
by the undersigned officer of the Fund in his capacity as an
officer of the Fund. The obligations of this Agreement shall
only be binding upon the assets and property of the Fund and
shall not be binding upon any Board member, officer or
shareholder of the Fund individually.
If the foregoing is in accordance with your
understanding, will you kindly so indicate by signing and
returning to us the enclosed copy hereof.
Very truly yours,
DREYFUS NEW YORK MUNICIPAL CASH
MANAGEMENT
By:______________________________
Accepted:
THE DREYFUS CORPORATION
By:_______________________________
DISTRIBUTION AGREEMENT
DREYFUS NEW YORK MUNICIPAL CASH MANAGEMENT
144 Glenn Curtiss Boulevard
Uniondale, New York 11556-0144
August 24, 1994
Premier Mutual Fund Services, Inc.
One Exchange Place
Tenth Floor
Boston, Massachusetts 02109
Dear Sirs:
This is to confirm that, in consideration of the agree-
ments hereinafter contained, the above-named investment company
(the "Fund") has agreed that you shall be, for the period of
this agreement, the distributor of (a) shares of each Series of
the Fund set forth on Exhibit A hereto, as such Exhibit may be
revised from time to time (each, a "Series") or (b) if no Series
are set forth on such Exhibit, shares of the Fund. For purposes
of this agreement the term "Shares" shall mean the authorized
shares of the relevant Series, if any, and otherwise shall mean
the Fund's authorized shares.
1. Services as Distributor
1.1 You will act as agent for the distribution of
Shares covered by, and in accordance with, the registration
statement and prospectus then in effect under the Securities Act
of 1933, as amended, and will transmit promptly any orders
received by you for purchase or redemption of Shares to the
Transfer and Dividend Disbursing Agent for the Fund of which the
Fund has notified you in writing.
1.2 You agree to use your best efforts to solicit
orders for the sale of Shares. It is contemplated that you will
enter into sales or servicing agreements with securities
dealers, financial institutions and other industry
professionals, such as investment advisers, accountants and
estate planning firms, and in so doing you will act only on your
own behalf as principal.
1.3 You shall act as distributor of Shares in
compliance with all applicable laws, rules and regulations,
including, without limitation, all rules and regulations made or
adopted pursuant to the Investment Company Act of 1940, as
amended, by the Securities and Exchange Commission or any
securities association registered under the Securities Exchange
Act of 1934, as amended.
1.4 Whenever in their judgment such action is
warranted by market, economic or political conditions, or by
abnormal circumstances of any kind, the Fund's officers may
decline to accept any orders for, or make any sales of, any
Shares until such time as they deem it advisable to accept such
orders and to make such sales and the Fund shall advise you
promptly of such determination.
1.5 The Fund agrees to pay all costs and expenses in
connection with the registration of Shares under the Securities
Act of 1933, as amended, and all expenses in connection with
maintaining facilities for the issue and transfer of Shares and
for supplying information, prices and other data to be furnished
by the Fund hereunder, and all expenses in connection with the
preparation and printing of the Fund's prospectuses and
statements of additional information for regulatory purposes and
for distribution to shareholders; provided however, that nothing
contained herein shall be deemed to require the Fund to pay any
of the costs of advertising the sale of Shares.
1.6 The Fund agrees to execute any and all documents
and to furnish any and all information and otherwise to take all
actions which may be reasonably necessary in the discretion of
the Fund's officers in connection with the qualification of
Shares for sale in such states as you may designate to the Fund
and the Fund may approve, and the Fund agrees to pay all
expenses which may be incurred in connection with such
qualification. You shall pay all expenses connected with your
own qualification as a dealer under state or Federal laws and,
except as otherwise specifically provided in this agreement, all
other expenses incurred by you in connection with the sale of
Shares as contemplated in this agreement.
1.7 The Fund shall furnish you from time to time, for
use in connection with the sale of Shares, such information with
respect to the Fund or any relevant Series and the Shares as you
may reasonably request, all of which shall be signed by one or
more of the Fund's duly authorized officers; and the Fund
warrants that the statements contained in any such information,
when so signed by the Fund's officers, shall be true and
correct. The Fund also shall furnish you upon request with:
(a) semi-annual reports and annual audited reports of the Fund's
books and accounts made by independent public accountants
regularly retained by the Fund, (b) quarterly earnings
statements prepared by the Fund, (c) a monthly itemized list of
the securities in the Fund's or, if applicable, each Series'
portfolio, (d) monthly balance sheets as soon as practicable
after the end of each month, and (e) from time to time such
additional information regarding the Fund's financial condition
as you may reasonably request.
1.8 The Fund represents to you that all registration
statements and prospectuses filed by the Fund with the Securi-
ties and Exchange Commission under the Securities Act of 1933,
as amended, and under the Investment Company Act of 1940, as
amended, with respect to the Shares have been carefully prepared
in conformity with the requirements of said Acts and rules and
regulations of the Securities and Exchange Commission there-
under. As used in this agreement the terms "registration state-
ment" and "prospectus" shall mean any registration statement and
prospectus, including the statement of additional information
incorporated by reference therein, filed with the Securities and
Exchange Commission and any amendments and supplements thereto
which at any time shall have been filed with said Commission.
The Fund represents and warrants to you that any registration
statement and prospectus, when such registration statement
becomes effective, will contain all statements required to be
stated therein in conformity with said Acts and the rules and
regulations of said Commission; that all statements of fact
contained in any such registration statement and prospectus will
be true and correct when such registration statement becomes
effective; and that neither any registration statement nor any
prospectus when such registration statement becomes effective
will include an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary
to make the statements therein not misleading. The Fund may but
shall not be obligated to propose from time to time such amend-
ment or amendments to any registration statement and such
supplement or supplements to any prospectus as, in the light of
future developments, may, in the opinion of the Fund's counsel,
be necessary or advisable. If the Fund shall not propose such
amendment or amendments and/or supplement or supplements within
fifteen days after receipt by the Fund of a written request from
you to do so, you may, at your option, terminate this agreement
or decline to make offers of the Fund's securities until such
amendments are made. The Fund shall not file any amendment to
any registration statement or supplement to any prospectus
without giving you reasonable notice thereof in advance;
provided, however, that nothing contained in this agreement
shall in any way limit the Fund's right to file at any time such
amendments to any registration statement and/or supplements to
any prospectus, of whatever character, as the Fund may deem
advisable, such right being in all respects absolute and
unconditional.
1.9 The Fund authorizes you to use any prospectus in
the form furnished to you from time to time, in connection with
the sale of Shares. The Fund agrees to indemnify, defend and
hold you, your several officers and directors, and any person
who controls you within the meaning of Section 15 of the Securi-
ties Act of 1933, as amended, free and harmless from and against
any and all claims, demands, liabilities and expenses (including
the cost of investigating or defending such claims, demands or
liabilities and any counsel fees incurred in connection there-
with) which you, your officers and directors, or any such con-
trolling person, may incur under the Securities Act of 1933, as
amended, or under common law or otherwise, arising out of or
based upon any untrue statement, or alleged untrue statement, of
a material fact contained in any registration statement or any
prospectus or arising out of or based upon any omission, or
alleged omission, to state a material fact required to be stated
in either any registration statement or any prospectus or
necessary to make the statements in either thereof not
misleading; provided, however, that the Fund's agreement to
indemnify you, your officers or directors, and any such control-
ling person shall not be deemed to cover any claims, demands,
liabilities or expenses arising out of any untrue statement or
alleged untrue statement or omission or alleged omission made in
any registration statement or prospectus in reliance upon and in
conformity with written information furnished to the Fund by you
specifically for use in the preparation thereof. The Fund's
agreement to indemnify you, your officers and directors, and any
such controlling person, as aforesaid, is expressly conditioned
upon the Fund's being notified of any action brought against
you, your officers or directors, or any such controlling person,
such notification to be given by letter or by telegram addressed
to the Fund at its address set forth above within ten days after
the summons or other first legal process shall have been served.
The failure so to notify the Fund of any such action shall not
relieve the Fund from any liability which the Fund may have to
the person against whom such action is brought by reason of any
such untrue, or alleged untrue, statement or omission, or
alleged omission, otherwise than on account of the Fund's
indemnity agreement contained in this paragraph 1.9. The Fund
will be entitled to assume the defense of any suit brought to
enforce any such claim, demand or liability, but, in such case,
such defense shall be conducted by counsel of good standing
chosen by the Fund and approved by you. In the event the Fund
elects to assume the defense of any such suit and retain counsel
of good standing approved by you, the defendant or defendants in
such suit shall bear the fees and expenses of any additional
counsel retained by any of them; but in case the Fund does not
elect to assume the defense of any such suit, or in case you do
not approve of counsel chosen by the Fund, the Fund will
reimburse you, your officers and directors, or the controlling
person or persons named as defendant or defendants in such suit,
for the fees and expenses of any counsel retained by you or
them. The Fund's indemnification agreement contained in this
paragraph 1.9 and the Fund's representations and warranties in
this agreement shall remain operative and in full force and
effect regardless of any investigation made by or on behalf of
you, your officers and directors, or any controlling person, and
shall survive the delivery of any Shares. This agreement of
indemnity will inure exclusively to your benefit, to the benefit
of your several officers and directors, and their respective
estates, and to the benefit of any controlling persons and their
successors. The Fund agrees promptly to notify you of the
commencement of any litigation or proceedings against the Fund
or any of its officers or Board members in connection with the
issue and sale of Shares.
1.10 You agree to indemnify, defend and hold the Fund,
its several officers and Board members, and any person who con-
trols the Fund within the meaning of Section 15 of the Securi-
ties Act of 1933, as amended, free and harmless from and against
any and all claims, demands, liabilities and expenses (including
the cost of investigating or defending such claims, demands or
liabilities and any counsel fees incurred in connection there-
with) which the Fund, its officers or Board members, or any such
controlling person, may incur under the Securities Act of 1933,
as amended, or under common law or otherwise, but only to the
extent that such liability or expense incurred by the Fund, its
officers or Board members, or such controlling person resulting
from such claims or demands, shall arise out of or be based upon
any untrue, or alleged untrue, statement of a material fact
contained in information furnished in writing by you to the Fund
specifically for use in the Fund's registration statement and
used in the answers to any of the items of the registration
statement or in the corresponding statements made in the pro-
spectus, or shall arise out of or be based upon any omission, or
alleged omission, to state a material fact in connection with
such information furnished in writing by you to the Fund and
required to be stated in such answers or necessary to make such
information not misleading. Your agreement to indemnify the
Fund, its officers and Board members, and any such controlling
person, as aforesaid, is expressly conditioned upon your being
notified of any action brought against the Fund, its officers or
Board members, or any such controlling person, such notification
to be given by letter or telegram addressed to you at your
address set forth above within ten days after the summons or
other first legal process shall have been served. You shall
have the right to control the defense of such action, with
counsel of your own choosing, satisfactory to the Fund, if such
action is based solely upon such alleged misstatement or
omission on your part, and in any other event the Fund, its
officers or Board members, or such controlling person shall each
have the right to participate in the defense or preparation of
the defense of any such action. The failure so to notify you of
any such action shall not relieve you from any liability which
you may have to the Fund, its officers or Board members, or to
such controlling person by reason of any such untrue, or alleged
untrue, statement or omission, or alleged omission, otherwise
than on account of your indemnity agreement contained in this
paragraph 1.10. This agreement of indemnity will inure
exclusively to the Fund's benefit, to the benefit of the Fund's
officers and Board members, and their respective estates, and to
the benefit of any controlling persons and their successors.
You agree promptly to notify the Fund of the commencement of any
litigation or proceedings against you or any of your officers or
directors in connection with the issue and sale of Shares.
1.11 No Shares shall be offered by either you or the
Fund under any of the provisions of this agreement and no orders
for the purchase or sale of such Shares hereunder shall be
accepted by the Fund if and so long as the effectiveness of the
registration statement then in effect or any necessary amend-
ments thereto shall be suspended under any of the provisions of
the Securities Act of 1933, as amended, or if and so long as a
current prospectus as required by Section 10 of said Act, as
amended, is not on file with the Securities and Exchange
Commission; provided, however, that nothing contained in this
paragraph 1.11 shall in any way restrict or have an application
to or bearing upon the Fund's obligation to repurchase any
Shares from any shareholder in accordance with the provisions of
the Fund's prospectus or charter documents.
1.12 The Fund agrees to advise you immediately in
writing:
(a) of any request by the Securities and Exchange
Commission for amendments to the registration statement
or prospectus then in effect or for additional
information;
(b) in the event of the issuance by the Securities
and Exchange Commission of any stop order suspending
the effectiveness of the registration statement or pro-
spectus then in effect or the initiation of any
proceeding for that purpose;
(c) of the happening of any event which makes
untrue any statement of a material fact made in the
registration statement or prospectus then in effect or
which requires the making of a change in such registra-
tion statement or prospectus in order to make the
statements therein not misleading; and
(d) of all actions of the Securities and
Exchange Commission with respect to any amendments to
any registration statement or prospectus which may from
time to time be filed with the Securities and Exchange
Commission.
2. Offering Price
Shares of any class of the Fund offered for sale by you
shall be offered for sale at a price per share (the "offering
price") approximately equal to (a) their net asset value
(determined in the manner set forth in the Fund's charter
documents) plus (b) a sales charge, if any and except to those
persons set forth in the then-current prospectus, which shall be
the percentage of the offering price of such Shares as set forth
in the Fund's then-current prospectus. The offering price, if
not an exact multiple of one cent, shall be adjusted to the
nearest cent. In addition, Shares of any class of the Fund
offered for sale by you may be subject to a contingent deferred
sales charge as set forth in the Fund's then-current prospectus.
You shall be entitled to receive any sales charge or contingent
deferred sales charge in respect of the Shares. Any payments to
dealers shall be governed by a separate agreement between you
and such dealer and the Fund's then-current prospectus.
3. Term
This agreement shall continue until the date (the
"Reapproval Date") set forth on Exhibit A hereto (and, if the
Fund has Series, a separate Reapproval Date shall be specified
on Exhibit A for each Series), and thereafter shall continue
automatically for successive annual periods ending on the day
(the "Reapproval Day") of each year set forth on Exhibit A
hereto, provided such continuance is specifically approved at
least annually by (i) the Fund's Board or (ii) vote of a
majority (as defined in the Investment Company Act of 1940) of
the Shares of the Fund or the relevant Series, as the case may
be, provided that in either event its continuance also is
approved by a majority of the Board members who are not
"interested persons" (as defined in said Act) of any party to
this agreement, by vote cast in person at a meeting called for
the purpose of voting on such approval. This agreement is
terminable without penalty, on 60 days' notice, by vote of
holders of a majority of the Fund's or, as to any relevant
Series, such Series' outstanding voting securities or by the
Fund's Board as to the Fund or the relevant Series, as the case
may be. This agreement is terminable by you, upon 270 days'
notice, effective on or after the fifth anniversary of the date
hereof. This agreement also will terminate automatically, as to
the Fund or relevant Series, as the case may be, in the event of
its assignment (as defined in said Act).
4. Exclusivity
So long as you act as the distributor of Shares, you
shall not perform any services for any entity other than
investment companies advised or administered by The Dreyfus
Corporation. The Fund acknowledges that the persons employed by
you to assist in the performance of your duties under this
agreement may not devote their full time to such service and
nothing contained in this agreement shall be deemed to limit or
restrict your or any of your affiliates right to engage in and
devote time and attention to other businesses or to render
services of whatever kind or nature.
5. Miscellaneous
This agreement has been executed on behalf of the Fund
by the undersigned officer of the Fund in his capacity as an
officer of the Fund. The obligations of this agreement shall
only be binding upon the assets and property of the Fund and
shall not be binding upon any Board member, officer or
shareholder of the Fund individually.
Please confirm that the foregoing is in accordance with
your understanding and indicate your acceptance hereof by
signing below, whereupon it shall become a binding agreement
between us.
Very truly yours,
DREYFUS NEW YORK MUNICIPAL CASH
MANAGEMENT
By:
Accepted:
PREMIER MUTUAL FUND SERVICES, INC.
By:________________________
EXHIBIT A
Reapproval Date Reapproval Day
June 11, 1996 June 11th
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the captions "Condensed
Financial Information" and "Custodian, Transfer and Dividend Disbursing
Agent, Counsel and Independent Auditors" and to the use of our report
dated September 8, 1994, in this Registration Statement (Form N-1A 33-42431)
of Dreyfus New York Municipal Cash Management.
ERNST & YOUNG LLP
New York, New York
September 29, 1994
DREYFUS NEW YORK MUNICIPAL CASH MANAGEMENT
SERVICE PLAN
Introduction: It has been proposed that the above-
captioned investment company (the "Fund") adopt a Service Plan
(the "Plan") relating to its Class B shares in accordance with
Rule 12b-1, promulgated under the Investment Company Act of 1940,
as amended (the "Act"). Under the Plan, the Fund would (a)
reimburse the Fund's distributor (the "Distributor") for
distributing the Fund's Class B shares (the payments in this
clause (a) being referred to as "Distributor Payments") and
(b) pay The Dreyfus Corporation, Dreyfus Service Corporation and
any affiliate of either of them (collectively, "Dreyfus") for
advertising and marketing relating to the Fund's Class B shares
and for providing certain services relating to Class B
shareholder accounts, such as answering shareholder inquiries
regarding the Fund and providing reports and other information,
and services related to the maintenance of shareholder accounts
("Servicing") (the payments in this clause (b) being referred to
as "Dreyfus Payments"). If this proposal is to be implemented,
the Act and said Rule 12b-1 require that a written plan
describing all material aspects of the proposed financing be
adopted by the Fund.
The Fund's Board, in considering whether the Fund
should implement a written plan, has requested and evaluated such
information as it deemed necessary to an informed determination
as to whether a written plan should be implemented and has
considered such pertinent factors as it deemed necessary to form
the basis for a decision to use assets attributable to the Fund's
Class B shares for such purposes.
In voting to approve the implementation of such a plan,
the Board members have concluded, in the exercise of their
reasonable business judgment and in light of their respective
fiduciary duties, that there is a reasonable likelihood that the
plan set forth below will benefit the Fund and holders of its
Class B shares.
The Plan: The material aspects of this Plan are as
follows:
1. (a) The aggregate annual fee the Fund may pay
under this Plan for Distributor Payments and Dreyfus Payments is
.25 of 1% of the value of the Fund's average daily net assets
attributable to Class B (the "Aggregate Amount").
(b) The Fund shall reimburse the Distributor in
respect of Distributor Payments an amount not to exceed an annual
rate of .25 of 1% of the value of the average daily net assets
attributable to Class B for such year (the "Distributor Amount").
(c) The Fund shall pay Dreyfus in respect of
Dreyfus Payments an annual fee equal to the difference between
the Aggregate Amount and the Distributor Amount for such year.
(d) Each of the Distributor and Dreyfus may pay
one or more securities dealers, financial institutions (which may
include banks) or other industry professionals, such as
investment advisers, accountants and estate planning firms
(severally, a "Service Agent"), a fee in respect of the Fund's
Class B shares owned by investors with whom the Service Agent has
a Servicing relationship or for whom the Service Agent is the
dealer or holder of record. Each of the Distributor and Dreyfus
shall determine the amounts to be paid to the Service Agents to
which it will make payments under this Plan and the basis on
which such payments will be made. Payments to a Service Agent
are subject to compliance by the Service Agent with the terms of
any related Plan agreement between the Service Agent and the
Distributor or Dreyfus, as the case may be. The fee payable for
Servicing is intended to be a "service fee" as defined in Article
III, Section 26 of the NASD Rules of Fair Practice.
2. For the purposes of determining the fees payable
under this Plan, the value of the Fund's net assets attributable
to Class B shall be computed in the manner specified in the
Fund's charter documents as then in effect for the computation of
the value of the Fund's net assets attributable to such Class.
3. The Fund's Board shall be provided, at least
quarterly, with a written report of all amounts expended pursuant
to this Plan. The report shall state the purpose for which the
amounts were expended.
4. This Plan will become effective upon the later to
occur of (i) the consummation of the transactions contemplated by
the Amended and Restated Agreement and Plan of Merger dated as of
December 5, 1993 by and among Mellon Bank Corporation, Mellon
Bank, N.A., XYZ Sub Corporation and The Dreyfus Corporation or
(ii) approval by (a) holders of a majority of the Fund's
outstanding Class B shares, and (b) a majority of the Board
members, including a majority of the Board members who are not
"interested persons" (as defined in the Act) of the Fund and have
no direct or indirect financial interest in the operation of this
Plan or in any agreements entered into in connection with this
Plan, pursuant to a vote cast in person at a meeting called for
the purpose of voting on the approval of this Plan.
5. This Plan shall continue for a period of one year
from its effective date, unless earlier terminated in accordance
with its terms, and thereafter shall continue automatically for
successive annual periods, provided such continuance is approved
at least annually in the manner provided in paragraph 4(b)
hereof.
6. This Plan may be amended at any time by the Fund's
Board, provided that (a) any amendment to increase materially the
costs which the Fund may bear pursuant to this Plan shall be
effective only upon approval by a vote of the holders of a
majority of the Fund's outstanding Class B shares, and (b) any
material amendments of the terms of this Plan shall become
effective only upon approval as provided in paragraph 4(b)
hereof.
7. This Plan is terminable without penalty at any
time by (a) vote of a majority of the Board members who are not
"interested persons" (as defined in the Act) of the Fund and have
no direct or indirect financial interest in the operation of this
Plan or in any agreements entered into in connection with this
Plan, or (b) vote of the holders of a majority of the Fund's
outstanding Class B shares.
8. The obligations hereunder and under any related
Plan agreement shall only be binding upon the assets and property
of the Fund and shall not be binding upon any Board member,
officer or shareholder of the Fund individually.
Dated: May 24, 1994
DREYFUS NEW YORK MUNICIPAL CASH MANAGEMENT - CLASS B
Value of Account 7/24/94 $ 1.000000000
+ Dividend on 7/25/94 $ 0.000065672
+ Dividend on 7/26/94 0.000064128
+ Dividend on 7/27/94 0.000064202
+ Dividend on 7/28/94 0.000064589
+ Dividend on 7/29/94 0.000195189 0.000453780
-------------
Value of Account 7/31/94 1.000453780
Less the value of account 7/24/94 (1.000000000)
-------------
Change in Account 0.000453780
Divided by value of account 7/24/94 1.000000000
-------------
Base Period Return 0.000453780
=============
Annualized Seven Day Yield ( 0.000453780 x 365 / 7) 2.37%
=============
Value of Account 7/24/94 $ 1.000000000
+ Dividend on 7/25/94 $ 0.000065672
+ Dividend on 7/26/94 0.000064128
+ Dividend on 7/27/94 0.000064202
+ Dividend on 7/28/94 0.000064589
+ Dividend on 7/29/94 0.000195189 0.000453780
-------------
Value of Account 7/31/94 1.000453780
Less the value of account 7/24/94 (1.000000000)
-------------
Change in Account 0.000453780
Divided by value of account 7/24/94 1.000000000
-------------
Base Period Return 0.000453780
=============
365/7
Annualized Effective Yield [( 0.000453780 +1) ]-1 2.39%
=============
TAX EQUIVALENT YIELD
Yield = 2.37%
Taxable portion of yield = 0.00%
------
Tax exempt portion of yield = 2.37%
======
Federal, State & City Combined Tax Bracket = 47.05%
======
Tax
Equivalent Yield = 2.37 / (1- 0.4705 ) = 4.48%
======
POWER OF ATTORNEY
The undersigned hereby constitutes and appoints Frederick C. Dey, Eric
B. Fischman, Ruth D. Leibert and John E. Pelletier and each of them, with
full power to act without the other, his or her true and lawful attorney-in-
fact and agent, with full power of substitution and resubstitution, for him
or her and in his or her name, place and stead, in any and all capacities
(until revoked in writing) to sign any and all amendments to the Registration
Statement for Dreyfus New York Municipal Cash Management (including
post-effective amendments and amendments thereto), and to file the same, with
all exhibits thereto, and granting unto said attorneys-in-fact and agents,
and each of them, full power and authority to do and perform each and every
act and thing ratifying and confirming all that said attorneys-in-fact and
agents or any of them, or their or his or her substitute or substitutes, may
lawfully do or cause to be done by virtue hereof.
______________________________________
David W. Burke, Board Member
______________________________________
Isabel P. Dunst, Board Member
______________________________________
Lyle E. Gramley, Board Member
______________________________________
Warren B. Rudman, Board Member
OTHER EXHIBIT (b)
POWER OF ATTORNEY
The undersigned hereby constitutes and appoints Frederick C. Dey, Eric
B. Fischman, Ruth D. Leibert and John E. Pelletier and each of them, with
full power to act without the other, her true and lawful attorney-in-fact
and agent, with full power of substitution and resubstitution, for her and
in her name, place and stead, in any and all capacities (until revoked in
writing) to sign any and all amendments to the Registration Statement for
Dreyfus New York Municipal Cash Management (including post-effective
amendments and amendments thereto), and to file the same, with all exhibits
thereto, and other documents in connection therewith, with the Securities
and Exchange Commission, granting unto said attorneys-in-fact and agents,
and each of them, full power and authority to do and perform each and every
act and thing ratifying and confirming all that said attorneys-in-fact and
agents or any of them, or their or his or her substitute or substitutes,
may lawfully do or cause to be done by virtue hereto.
________________________________ September 26, 1994
Marie E. Connolly, President
OTHER EXHIBIT (c)
DREYFUS NEW YORK MUNICIPAL CASH MANAGEMENT
Certificate of Assistant Secretary
The undersigned, Eric B. Fischman Assistant Secretary of Dreyfus
New York Municipal Cash Management (the "Fund"), hereby certifies that set
forth below is a copy of the resolution adopted by the Fund's Board of
Trustees authorizing the signing by Frederick C. Dey, Eric B. Fischman,
Ruth D. Leibert and John Pelletier on behalf of the proper officers of the
Fund pursuant to a power of attorney.
RESOLVED, that the Registration Statement and any and
all amendments and supplements thereto, may be signed
by any one of Frederick C. Dey, Eric B. Fischman, Ruth
D. Leibert and John Pelletier as the attorney-in-fact
for the proper officers of the Fund, with full power
of substitution and resubstitution; and that the
appointment of each of such persons as such attorney-
in-fact hereby is authorized and approved; and that
such attorneys-in-fact, and each of them, shall have
full power and authority to do and perform each and
every act and thing requisite and necessary to be done
in connection with such Registration Statement and any
and all amendments and supplements thereto, as fully
to all intents and purposes as the officer, for whom
he or she is acting as attorney-in-fact, might or
could do in person.
IN WITNESS WHEREOF, I have hereunto signed my name and affixed
the Seal of the Fund on September 27, 1994.
_________________________________
Eric B. Fischman
Assistant Secretary
(SEAL)
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<ACCUMULATED-NII-PRIOR> 0
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