IDAHO TAX FREE FUND
KANSAS TAX FREE FUND
UTAH TAX FREE FUND
WASHINGTON INSURED TAX FREE FUND
SEMI-ANNUAL REPORT
Dated June 30, 1995
Voyageur offers a family of mutual funds, each with an individual objective
stated in its prospectus. Investment objectives of the funds range from high
current income to long-term capital appreciation. Exchange privileges allow you
to change your investment between Voyageur Funds as your objectives or market
conditions change.
VOYAGEUR TAX FREE FUNDS seek high current income free from both Federal income
taxes and state income taxes (where applicable). The Funds invest in investment
grade municipal bonds.
Voyageur ARIZONA Tax Free Fund Voyageur KANSAS Tax Free Fund
Voyageur CALIFORNIA Tax Free Fund Voyageur MINNESOTA Tax Free Fund
Voyageur COLORADO Tax Free Fund Voyageur NEW MEXICO Tax Free Fund
Voyageur FLORIDA Tax Free Fund Voyageur NORTH DAKOTA Tax Free Fund
Voyageur IDAHO Tax Free Fund Voyageur UTAH Tax Free Fund
Voyageur IOWA Tax Free Fund Voyageur WISCONSIN Tax Free Fund
VOYAGEUR INSURED TAX FREE FUNDS seek high current income free from both Federal
income taxes and state income taxes (where applicable) with the added safety of
an insured portfolio. The Funds invest in insured municipal bonds.
<TABLE>
<S> <C>
Voyageur ARIZONA Insured Tax Free Fund Voyageur MISSOURI Insured Tax Free Fund
Voyageur CALIFORNIA Insured Tax Free Fund Voyageur NATIONAL Insured Tax Free Fund
Voyageur FLORIDA Insured Tax Free Fund Voyageur OREGON Insured Tax Free Fund
Voyageur MINNESOTA Insured Fund Voyageur WASHINGTON Insured Tax Free Fund
</TABLE>
VOYAGEUR LIMITED TERM FUNDS seek to preserve original investment principal while
providing income free from both Federal income taxes and state income taxes
(where applicable). The Funds invest in intermediate term investment grade
municipal bonds.
<TABLE>
<S> <C>
Voyageur FLORIDA Limited Term Tax Free Fund Voyageur MINNESOTA Limited Term Tax Free Fund
</TABLE>
VOYAGEUR EQUITY FUNDS seek long term capital appreciation by investing in common
stocks.
Voyageur AGGRESSIVE GROWTH Fund Voyageur INTERNATIONAL Equity Fund
Voyageur GROWTH Stock Fund
VOYAGEUR INCOME FUNDS seek high current income from investments issued,
guaranteed or otherwise backed by the full faith and credit of the U.S.
Government.
Voyageur U.S. GOVERNMENT SECURITIES Fund
VOYAGEUR CASH TRUST SERIES MONEY MARKET FUNDS seek high current income,
principal protection and liquidity by investing in money market instruments.
Voyageur CALIFORNIA MUNICIPAL CASH Series Voyageur MUNICIPAL CASH Series
Voyageur FLORIDA MUNICIPAL CASH Series Voyageur OHIO MUNICIPAL CASH Series
Voyageur GOVERNMENT CASH Series Voyageur PRIME CASH Series
Voyageur MINNESOTA MUNICIPAL CASH Series Voyageur TREASURY CASH Series
For more complete information regarding the investment objectives, fees and
expenses of the Funds, please obtain a prospectus from your Investment
Representative or from Voyageur, 90 South Seventh Street, Suite 4400,
Minneapolis, MN 55402-4115; (612) 376-7044 (local); 800-525-6584 (MKTG).
Dear Shareholder:
The municipal bond market's dramatic rebound in the first half of 1995 caused
many mutual funds to recover much of the ground they lost in last year's bear
market. This strong rally was evidenced by the Funds' performance. I am pleased
to present a considerably brighter picture of the municipal bond market and the
Funds' performance than was presented in my last letter to you.
The results below summarize each Fund's net asset value, dividends paid and
total net assets for the reporting period.
<TABLE>
<CAPTION>
VOYAGEUR IDAHO TAX FREE FUND
NET ASSET NET ASSET TOTAL NET
VALUE VALUE DIVIDENDS ASSETS
BEGINNING END PAID PER END OF
PERIOD OF PERIOD OF PERIOD SHARE PERIOD (000'S)
<S> <C> <C> <C> <C>
Period ended June 30, 1995:
Class A Shares $10.00* $10.63 $0.33 $6,339
Class B Shares 10.50** 10.63 0.16 419
Class C Shares 10.04*** 10.63 0.29 323
</TABLE>
* Net asset value at January 4, 1995 (commencement of operations)
** Net asset value at March 16, 1995 (commencement of operations)
*** Net asset value at January 11, 1995 (commencement of operations)
<TABLE>
<CAPTION>
VOYAGEUR KANSAS TAX FREE FUND
NET ASSET NET ASSET TOTAL NET
VALUE VALUE DIVIDENDS ASSETS
BEGINNING END PAID PER END OF
PERIOD OF PERIOD OF PERIOD SHARE PERIOD (000'S)
<S> <C> <C> <C> <C>
Period ended June 30, 1995:
Class A Shares $9.50 $10.22 $0.29 $8,987
Class B Shares 10.19* 10.22 0.10 89
Class C Shares 10.20** 10.23 0.09 15
</TABLE>
* Net asset value at April 8, 1995 (commencement of operations)
** Net asset value at April 12, 1995 (commencement of operations)
<TABLE>
<CAPTION>
VOYAGEUR UTAH TAX FREE FUND
NET ASSET NET ASSET TOTAL NET
VALUE VALUE DIVIDENDS ASSETS
BEGINNING END PAID PER END OF
PERIOD OF PERIOD OF PERIOD SHARE PERIOD (000'S)
<S> <C> <C> <C> <C>
Period ended June 30, 1995:
Class A Shares $9.80 $10.50 $0.30 $4,052
Class B Shares 10.63* 10.50 0.04 99
</TABLE>
* Net asset value at May 27, 1995 (commencement of operations)
<TABLE>
<CAPTION>
VOYAGEUR WASHINGTON INSURED TAX FREE FUND
NET ASSET NET ASSET TOTAL NET
VALUE VALUE DIVIDENDS ASSETS
BEGINNING END PAID PER END OF
PERIOD OF PERIOD OF PERIOD SHARE PERIOD (000'S)
<S> <C> <C> <C> <C>
Period ended June 30, 1995:
Class A Shares $9.21 $9.96 $0.29 $2,301
Class C Shares 9.94* 9.96 0.08 17
</TABLE>
* Net asset value at April 21, 1995 (commencement of operations)
In the pages that follow, the Fund's Manager will update you on how the economy
and the municipal bond market affected the Funds' during this reporting period.
The manager will discuss each Fund's performance and some strategies used to
maximize performance.
We assert that a long-range view of investing provides the greatest benefit to
our shareholders. We encourage you to maintain a long-range view of investing;
we believe that you will derive the greatest benefit by doing so.
Thank-you for investing with Voyageur.
Sincerely,
John G. Taft
President
Voyageur Idaho Tax Free Fund
Voyageur Kansas Tax Free Fund
Voyageur Utah Tax Free Fund
Voyageur Washington Insured Tax Free Fund
DISCUSSION OF FUND MANAGEMENT BY ELIZABETH H. HOWELL, PORTFOLIO MANAGER
Ms. Howell is Senior Vice President and Tax Exempt Portfolio Manager for the
Voyageur Idaho Tax Free Fund. She has over ten years experience as a securities
analyst and portfolio manager.
The Voyageur Idaho Tax Free Fund 's total investment return for the reporting
period was 9.50%. Although the bond supply in Idaho is very light, the Fund is
fully invested. We achieved relatively stronger performance from owning 100
percent bonds and holding no cash in the portfolio. When new money came into the
fund, we invested it immediately. This enabled us to lock in higher yields.
Nearly 88 percent of the portfolio is made up of in-state bonds. Many Idaho
investors get satisfaction from knowing that their investment not only provides
an attractive return and tax exempt earnings for them, but also benefits
municipalities within their home state. We recognize Idaho residents'
preferences for in-state paper, and when possible, purchase Idaho bonds. (Note:
We had targeted a 50:50 ratio of Idaho bonds to U.S. Territory bonds, but were
able to weight the portfolio with significantly more in-state bonds.)
We manage the Fund to maintain a high credit quality profile. Over 80 percent of
the portfolio is comprised of bonds rated in the three highest categories by
Standard & Poor's Corporation and/or Moody's Investors Service (AAA/Aaa, AA/Aa,
A/A). We buy some non-rated (NR) Idaho bonds because their quality is very good.
Our analysts at Voyageur "grade" these issues to determine their credit quality.
If we deem the bond's credit worthiness to be comparable to investment grade, we
may buy it for the Fund. In fact, many of the non-rated bonds in the portfolio
can be compared to similar issues rated AA/Aa or A/A. The reason many small
issuers do not rate their bonds is to save money. Rating services, such as
Moody's or S&P, charge the issuer or underwriter a fee for their service. Since
many issues in Idaho are very small--under $3 million--the cost of rating is not
always judicious. The benefit that non-rated bonds provide to the Fund and its
shareholders is extra yield. The yield for non-rated bonds is higher than for
rated bonds. However, rest assured that we have not--and never will--compromise
on quality when purchasing NR bonds for the portfolio.
The Fund had a long average maturity of 19.66 years and a long duration of 10.2
years. Longer maturity/duration bonds are more sensitive to changes in long term
interest rates, and consequently, the bonds held in the portfolio rallied
strongly in this year's declining interest rate environment.
DISCUSSION OF FUND MANAGEMENT BY ELIZABETH H. HOWELL, PORTFOLIO MANAGER
Ms. Howell is Senior Vice President and Tax Exempt Portfolio Manager for the
Voyageur Kansas Tax Free Fund. She has over ten years experience as a securities
analyst and portfolio manager.
At the state level, The Voyageur Kansas Tax Free Fund performed extremely well
in this reporting period, posting a total return of 10.53%. The Fund ranked
first among its six fund competitors in its Lipper objective of Kansas municipal
debt funds for one year, 6/30/94 through 6/30/95. (Note: This Lipper Analytical
Services ranking and the total return information that follow represent past
performance which is no guarantee of future results. Shares may be worth more or
less than their original cost. The total return based on net asset value for the
Fund's A-shares was 8.00% for one year and 6.74% since inception.)
The Kansas municipal market performed favorably due to the extreme shortage of
supply in the first half of 1995. We expect this situation to continue for the
remainder of the year. We anticipate that the strong demand for Kansas bonds and
the continued low supply will provide outstanding price support for the bonds in
the Fund.
We attribute the favorable performance to the following factors. First, we
maintained a long duration of 9.0 years and an average maturity of 13.8 years.
Longer duration and longer maturity securities outperformed bonds with shorter
durations and maturities in a declining interest rate environment. As yields
fell in the first half of 1995, bonds with longer maturities were more sensitive
to changes in long term interest rates. Second, consistent with our strategy
from last year, we continued to hold and purchase bonds with good call
protection to maintain the longer duration in the portfolio. This allowed the
Fund to take full advantage of the declining rate environment in the first half
of 1995. A third factor that contributed favorably to strong returns was that
the Fund was fully invested in bonds. We achieved relatively stronger
performance from owning 100% bonds and holding no cash in the portfolio.
Finally, the Fund was entirely comprised of bonds rated in the three highest
categories by Standard & Poor's Corporation and Moody's Investors Service
(AAA/Aaa, AA/Aa, A/A). We shall continue to buy quality bonds for the Fund, as
we believe quality is essential for consistent, long-term performance.
DISCUSSION OF FUND MANAGEMENT BY ANDREW M. MCCULLAGH, JR., PORTFOLIO MANAGER
Mr. McCullagh is Senior Vice President and Tax Exempt Portfolio Manager for the
Voyageur Utah Tax Free Fund. He has over 22 years experience in municipal bond
trading, underwriting, and portfolio management.
At the state level, the Utah economy continues to prosper with increases in new
industry and population. This growth will most likely sustain for the remainder
of the decade. Utah municipal bonds have been extremely scarce. The shortage of
in-state bonds has helped support the strong price performance of the bonds in
the Utah market. The Fund has witnessed excellent performance in light of a
strong demand, short supply and the strong market rally in the first half of
1995.
The Fund's total investment return for the reporting period was 10.19%. At the
end of this period, education, housing, and public power were the three largest
sectors in which the Fund was invested (20%, 17% and 15% respectively). We
remain committed to quality paper, hence the entire portfolio of the Voyageur
Utah Tax Free Fund is comprised of bonds rated in the three highest categories
by Standard & Poor's Corporation and/or Moody's Investors Service (AAA/Aaa
73.9%, AA/Aa 11.7%, and A/A 14.4%).
We continue to adhere to the strategy of buying quality bonds for the Fund. We
expect that favorable returns will continue, although not at the dramatic pace
experienced during the first half of the year. We believe that the Voyageur Utah
Tax Free Fund is poised to take full advantage of current market conditions.
DISCUSSION OF FUND MANAGEMENT BY ELIZABETH H. HOWELL, PORTFOLIO MANAGER
Ms. Howell is Senior Vice President and Tax Exempt Portfolio Manager for the
Voyageur Washington Insured Tax Free Fund. She has over ten years experience as
a securities analyst and portfolio manager.
At the state level, the supply of new issue Washington bonds was low compared to
the levels in 1994. The shortage of bonds helped to bolster the strong price
performance in the Washington market. This market is unique in that the supply
and demand of securities can be erratic. As a result, the strategy for the Fund
has been to utilize the opportunities when this imbalance occurs and purchase
high quality issues as bonds become available.
The Voyageur Washington Insured Tax Free Fund performed favorably during the
reporting period with a total investment return of 11.29%. The Fund outperformed
its benchmark index, the Lehman Brothers Long Insured Index which had a total
return of 10.19% for the same period.
We attribute this strong performance to two factors. First, the longer duration
and average maturity captured superior price appreciation in the declining
interest rate market that we experienced in the first half of 1995. At the end
of the reporting period, the Fund's duration was 10 years and the average
maturity was 16.4 years. Longer maturity bonds are more sensitive to changes in
long term interest rates. Second, the Fund held high quality insured bonds with
excellent call protection. We buy strong call protection because it enables
investors to lock in to favorable yields for a longer period of time. We are
constantly swapping bonds within the market to maintain adequate call protection
within the portfolio. Maintaining adequate call protection is a key component of
our investment strategy.
We continue to believe that high quality insured bonds and the Voyageur
Washington Insured Tax Free Fund are positioned to take full advantage of the
current market conditions.
(Insert Blank Page)
<TABLE>
<CAPTION>
THE VOYAGEUR FUNDS
STATEMENTS OF ASSETS AND LIABILITIES (UNAUDITED)
VOYAGEUR VOYAGEUR
IDAHO KANSAS
TAX FREE TAX FREE
FUND FUND
<S> <C> <C>
ASSETS
Investments in securities, at market value (note 1)
(identified costs, $7,329,381, $8,760,201, $4,134,390 and $2,337,781, respectively) $ 7,411,079 $ 8,885,975
Cash in bank on demand deposit ....................................................... 4 74,228
Accrued interest receivable .......................................................... 121,922 155,369
Receivable for Fund shares sold ...................................................... 126,254 5,728
Organizational costs (note 4) ........................................................ 8,972 --
Total assets ...................................................................... 7,668,231 9,121,300
LIABILITIES
Dividends payable to shareholders .................................................... 7,964 10,416
Payable for Fund shares redeemed ..................................................... -- 42
Payable for investment securities purchased .......................................... 559,027 --
Other accrued expenses ............................................................... 20,861 18,752
Total liabilities ................................................................. 587,852 29,210
NET ASSETS APPLICABLE TO OUTSTANDING SHARES .......................................... $ 7,080,379 $ 9,092,090
Represented by:
Capital stock - $.01 par value (note 1) ........................................... $ 6,658 --
Additional paid-in capital ........................................................ 6,972,781 $ 9,107,813
Distributions in excess of net investment income (note 1) ......................... (3,187) (11,979)
Accumulated net realized gain (loss) on investments ............................... 22,429 (129,518)
Unrealized appreciation (depreciation) of investments ............................. 81,698 125,774
TOTAL NET ASSETS ................................................................ $ 7,080,379 $ 9,092,090
Net assets applicable to outstanding Class A shares .................................. $ 6,338,957 $ 8,987,462
Net assets applicable to outstanding Class B shares .................................. $ 418,577 $ 89,492
Net assets applicable to outstanding Class C shares .................................. $ 322,845 $ 15,136
SHARES OUTSTANDING AND NET ASSET VALUE PER SHARE
Class A - Shares of Capital Stock or beneficial interest outstanding:
596,109, 878,995, 386,029 and 231,056, respectively (note 5) .................... $ 10.63 $ 10.22
Class B - Shares of Capital Stock or beneficial interest outstanding:
39,374, 8,756, 9,437 and N/A, respectively (note 5) ............................. $ 10.63 $ 10.22
Class C - Shares of Capital Stock or beneficial interest outstanding:
30,357, 1,480, N/A and 1,742, respectively (note 5) ............................. $ 10.63 $ 10.23
</TABLE>
See accompanying notes to financial statements.
<TABLE>
<CAPTION>
JUNE 30, 1995
VOYAGEUR VOYAGEUR
UTAH WASHINGTON INSURED
TAX FREE TAX FREE
FUND FUND
<S> <C> <C>
$4,106,492 $2,302,853
988 9
59,630 32,335
-- --
-- --
4,167,110 2,335,197
5,088 2,758
-- --
-- --
10,873 14,061
15,961 16,819
$4,151,149 $2,318,378
-- --
$4,250,533 $2,385,115
(4,082) (2,206)
(67,404) (29,603)
(27,898) (34,928)
$4,151,149 $2,318,378
$4,052,098 $2,301,033
$ 99,051 N/A
N/A $ 17,345
$10.50 $9.96
$10.50 N/A
N/A $9.96
</TABLE>
<TABLE>
<CAPTION>
THE VOYAGEUR FUNDS
STATEMENTS OF OPERATIONS (UNAUDITED)
VOYAGEUR VOYAGEUR
IDAHO KANSAS
TAX FREE TAX FREE
FUND* FUND
<S> <C> <C>
Investment income:
Interest.................................................................. $107,531 $237,429
Expenses (note 3):
Investment advisory and management fee.................................... 9,626 20,763
Dividend-disbursing, administrative and accounting services fee........... 17,079 6,868
Printing, postage and supplies............................................ 3,059 611
Audit and accounting fees................................................. 2,013 1,179
Legal fees................................................................ 1,666 378
Distribution fees - Class A............................................... 4,504 10,358
Distribution fees - Class B............................................... 432 94
Distribution fees - Class C............................................... 1,004 47
Directors' fee............................................................ 541 199
Registration fee.......................................................... 750 361
Custodian fees............................................................ 2,036 4,101
Amortization of organizational costs...................................... 195 --
Other..................................................................... 1,637 313
Total Expenses.......................................................... 44,542 45,272
Less: Expenses waived, absorbed or reduced............................... (38,509) (29,135)
Total net expenses...................................................... 6,033 16,137
Investment income - net................................................. 101,498 221,292
Realized and unrealized gain (loss) on investments:
Realized gain (loss) of security transactions............................. 22,429 (129,518)
Net change in unrealized appreciation or depreciation of investments...... 81,698 721,821
Net gain on investments................................................. 104,127 592,303
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS.................... $205,625 $813,595
</TABLE>
* Period from January 4, 1995 (commencement of operations) to June 30, 1995.
See accompanying notes to financial statements.
<TABLE>
<CAPTION>
SIX MONTHS ENDED JUNE 30, 1995
VOYAGEUR VOYAGEUR
UTAH WASHINGTON INSURED
TAX FREE TAX FREE
FUND FUND
<S> <C> <C>
$118,213 $ 57,718
9,896 5,035
3,327 2,661
411 125
2,284 1,044
474 380
4,936 2,512
59 N/A
N/A 32
57 147
518 17
2,547 3,368
-- --
70 30
24,579 15,351
(15,339) (14,428)
9,240 923
108,973 56,795
(55,583) (29,603)
330,790 174,636
275,207 145,033
$384,180 $201,828
</TABLE>
<TABLE>
<CAPTION>
THE VOYAGEUR FUNDS
STATEMENTS OF CHANGES IN NET ASSETS (UNAUDITED)
VOYAGEUR VOYAGEUR
IDAHO KANSAS
TAX FREE TAX FREE
FUND FUND
PERIOD FROM SIX MONTHS TWO MONTHS
JANUARY 4, 1995* ENDED ENDED
TO JUNE 30, 1995 JUNE 30, 1995 DECEMBER 31,
Operations: (UNAUDITED) (UNAUDITED) 1994 (NOTE 1)
<S> <C> <C> <C>
Investment income - net.......................................$ 101,498 $ 221,292 $ 65,301
Realized gain (loss) on investments - net..................... 22,429 (129,518) --
Net change in unrealized appreciation or depreciation
of investments............................................... 81,698 721,821 (83,900)
Net increase (decrease) in net assets resulting
from operations............................................ 205,625 813,595 (18,599)
Distributions to shareholders from:
Investment income - net:
Class A..................................................... (94,759) (222,195) (63,842)
Class B..................................................... (2,046) (375) N/A
Class C..................................................... (4,688) (181) N/A
Distributions in excess of net investment income:
Class A..................................................... (2,992) (11,971) --
Class B..................................................... -- (6) N/A
Class C..................................................... (200) (2) N/A
Net realized gain on investments:
Class A..................................................... -- -- (232)
Total distributions....................................... (104,685) (234,730) (64,074)
Share transactions (note 5): Proceeds from sale of shares:
Class A (note 3)............................................ 6,876,095 1,636,754 1,112,784
Class B..................................................... 421,468 90,019 N/A
Class C..................................................... 410,055 26,166 N/A
Net asset value of shares issued in reinvestment of net
investment income distributions, distributions in excess
of net investment income and realized gain distributions:
Class A................................................. 67,686 164,349 20,355
Class B................................................. 1,097 265 N/A
Class C................................................. 3,785 167 N/A
Payments for redemption of shares:
Class A..................................................... (704,108) (747,521) (164,747)
Class B..................................................... (10) (52) N/A
Class C (note 3)............................................ (96,629) (11,437) N/A
Increase in net assets from share transactions................ 6,979,439 1,158,710 968,392
Total increase in net assets................................ 7,080,379 1,737,575 885,719
Net assets at beginning of period................................ -- 7,354,515 6,468,796
Net assets at end of period (including undistributed net
investment income or (distributions in excess of net
investment income) of $(3,187), $(11,979), $1,459, $(4,082),
$4,174, $(2,206) and $1,314, respectively).................... $7,080,379 $9,092,090 $7,354,515
</TABLE>
* Commencement of operations
See accompanying notes to financial statements.
<TABLE>
<CAPTION>
VOYAGEUR VOYAGEUR
UTAH WASHINGTON INSURED
TAX FREE TAX FREE
FUND FUND
SIX MONTHS TWO MONTHS SIX MONTHS TWO MONTHS
ENDED ENDED ENDED ENDED
JUNE 30, 1995 DECEMBER 31, JUNE 30, 1995 DECEMBER 31,
(UNAUDITED) 1994 (NOTE 1) (UNAUDITED) 1994 (NOTE 1)
<S> <C> <C> <C> <C>
$ 108,973 $ 40,565 $ 56,795 $ 17,586
(55,583) (11,322) (29,603) --
330,790 (53,028) 174,636 (33,311)
384,180 (23,785) 201,828 (15,725)
(112,951) (36,391) (57,977) (16,502)
(196) N/A N/A N/A
N/A N/A (132) N/A
(4,080) -- (2,206) --
(2) N/A N/A N/A
N/A N/A -- N/A
-- -- -- --
(117,229) (36,391) (60,315) (16,502)
365,055 61,791 397,758 418,797
100,385 N/A N/A N/A
N/A N/A 17,270 N/A
52,944 9,376 21,061 2,584
80 N/A N/A N/A
N/A N/A -- N/A
(362,749) (336,332) (308,142) (458,296)
(10) N/A N/A N/A
N/A N/A (10) N/A
155,705 (265,165) 127,937 (36,915)
422,656 (325,341) 269,450 (69,142)
3,728,493 4,053,834 2,048,928 2,118,070
$4,151,149 $3,728,493 $2,318,378 $2,048,928
</TABLE>
THE VOYAGEUR FUNDS
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Voyageur Idaho Tax Free Fund (Idaho Tax Free Fund), a fund within Voyageur
Mutual Funds, Inc.; and Voyageur Kansas Tax Free Fund (Kansas Tax Free Fund),
Voyageur Utah Tax Free Fund (Utah Tax Free Fund), and Voyageur Washington
Insured Tax Free Fund (Washington Insured Tax Free Fund), funds within Voyageur
Investment Trust, a Massachusetts business trust, are registered under the
Investment Company Act of 1940 (as amended) as open-end management investment
companies. Idaho Tax Free Fund, Kansas Tax Free Fund, Utah Tax Free Fund and
Washington Insured Tax Free Fund (the Funds) are registered as non-diversified
Funds. The Funds offer Class A, Class B and Class C Shares. Class A Shares are
sold with a front-end sales charge. Class B Shares, first offered by the Funds
on March 1, 1995, may be subject to a contingent deferred sales charge and such
shares automatically convert to Class A after eight years. Class C Shares, first
offered on January 3, 1995 by Idaho Tax Free Fund and on March 1, 1995 by Kansas
Tax Free Fund, Utah Tax Free Fund and Washington Insured Tax Free Fund, may be
subject to a contingent deferred sales charge and have no conversion feature. As
of June 30, 1995, Utah Tax Free Fund had no Class C Shares outstanding and
Washington Insured Tax Free Fund had no Class B Shares outstanding. All classes
of shares have identical voting, dividend, liquidation and other rights and the
same terms and conditions, except that the level of distribution fees charged
differs between classes. Income, expenses (other than expenses incurred under
each class' Distribution Agreement) and realized and unrealized gains or losses
on investments are allocated to each class of shares based upon its relative net
assets. Pursuant to its articles of incorporation, Voyageur Mutual Funds, Inc.
has 100 billion shares of authorized capital stock that may be issued in one or
more series. Voyageur Investment Trust has an unlimited number of authorized
shares of beneficial interest that may be issued in one or more series.
Effective December 31, 1994, Kansas Tax Free Fund, Utah Tax Free Fund and
Washington Insured Tax Free Fund changed their fiscal year ends from October 31
to December 31.
The significant accounting policies followed by the Fund are summarized as
follows:
Investments in Securities
Securities are valued at fair value as determined by the Board of Directors.
Determination of fair value involves, among other things, using pricing services
or prices quoted by independent brokers. Short-term securities are valued at
amortized cost which approximates market value.
Security transactions are accounted for on the trade date. Securities gains
and losses are calculated on the identified-cost basis. Interest income,
including level-yield amortization of premium and original issue discount, is
accrued daily.
The Funds concentrate their investments in certain geographic areas and
therefore, may have more credit risk related to the economic conditions of these
areas than a portfolio with broader geographical diversification.
Securities Purchased on a When-Issued Basis
Delivery and payment for securities which have been purchased by each Fund on
a forward commitment or when-issued basis can take place up to a month or more
after the transaction date. During this period, such securities are subject to
market fluctuations and the portfolio maintains, in a segregated account with
its custodian, assets with a market value equal to or greater than the amount of
its purchase commitments.
Federal Taxes
The Funds' policy is to comply with the requirements of the Internal Revenue
Code applicable to regulated investment companies and to distribute its income
to shareholders in amounts that will avoid or minimize federal income or excise
taxes for the Funds. For federal income tax purposes, at December 31, 1994 the
Utah Tax Free Fund had a capital loss carryover of $11,821 that will expire in
2001 and 2003 if not offset by subsequent capital gains. It is unlikely that the
Board of Trustees will authorize a distribution of any net realized capital
gains until the available capital loss carryover has been offset or expires.
Distributions to Shareholders
Dividends declared daily from net investment income are payable monthly in
cash or reinvested in additional shares of each Fund. Net short-term realized
capital gains, if any, may be distributed throughout the year and net long-term
realized capital gains, when available, are distributed annually.
(2) INVESTMENT SECURITIES TRANSACTIONS
Purchase cost and proceeds of sales of investment securities other than
short-term securities aggregated $8,005,687 and $966,205 for Idaho Tax Free
Fund, $3,458,428 and $1,588,531 for Kansas Tax Free Fund, $895,479 and $943,319
for Utah Tax Free Fund and $732,137 and $295,032 for Washington Insured Tax Free
Fund during the period ended June 30, 1995, respectively.
(3) EXPENSES
Each Fund has an investment advisory and management fee agreement with
Voyageur Fund Managers, Inc. (Voyageur) under which Voyageur manages each Fund's
assets and provides other specified services. The fee for investment management
and advisory services is payable monthly and is based on the average daily net
assets of each Fund at the annual rate of .50%. In addition, each Fund will pay
most other operating expenses including directors' fees, registration fees,
printing of shareholder reports, legal and auditing services and other
miscellaneous expenses. There was no portfolio insurance expense for Washington
Insured Tax Free Fund. Portfolio insurance expense, if any, is recognized over
the premium period. Voyageur is obligated to pay all expenses of each Fund
(excluding distribution fees, insurance premiums on portfolio securities, taxes,
interest and brokerage commissions) which exceed 1% of average daily net assets,
on an annual basis. During the period ended June 30, 1995, Voyageur absorbed
$19,583 for Idaho Tax Free Fund and $2,728 for Washington Insured Tax Free Fund
pursuant to the contractual 1% expense limitation and, excluding waivers of
distribution fees and expense reductions, voluntarily absorbed fees and expenses
totaling $15,417, $15,000, $10,000 and $7,272 for Idaho Tax Free Fund, Kansas
Tax Free Fund, Utah Tax Free Fund and Washington Insured Tax Free Fund,
respectively.
Each Fund will also pay a fee to Voyageur for acting as the Funds'
dividend-disbursing, administrative and accounting services agent. The fee is
paid monthly and is equal to the sum of $1.33 per shareholder account per month,
a fixed monthly fee ranging from $1,000 to $1,500 based on the level of each
Fund's average daily net assets and an annualized percentage of average daily
net assets at reducing rates from .11% to .02%. The Funds are also responsible
for reimbursing Voyageur's out-of-pocket expense in connection with the
performance of dividend-disbursing, administrative and accounting services.
All classes of shares have a Distribution Agreement under Rule 12b-1 of the
Investment Company Act of 1940 with Voyageur Fund Distributors, Inc. (Fund
Distributors). Under this plan each Fund is obligated to pay Fund Distributors a
monthly distribution fee at an annual rate of .25% of each Fund's average daily
net assets of the Class A Shares and 1.00% of each Fund's average daily net
assets of the Class B and C Shares. Fund Distributors may waive all or part of
its distribution fee at its sole discretion. During the period ended June 30,
1995, Fund Distributors voluntarily waived Class A distribution fees of $1,276
for Idaho Tax Free Fund, $10,008 for Kansas Tax Free Fund, $4,936 for Utah Tax
Free Fund and $2,342 for Washington Insured Tax Free Fund; Class B distribution
fees of $116 for Idaho Tax Free Fund, $26 for Kansas Tax Free Fund and $16 for
Utah Tax Free Fund; and Class C distribution fees of $81 for Idaho Tax Free
Fund. The Funds earned credits on uninvested cash balances held at the custodian
which were used to reduce certain fees for various custodial, pricing and
accounting services provided by the custodian bank. The credits earned for the
period ended June 30, 1995 were $3,067 for Idaho Tax Free Fund, $4,527 for
Kansas Tax Free Fund, $387 for Utah Tax Free Fund and $2,086 for Washington
Insured Tax Free Fund. Of these amounts $2,036, $4,101, $387 and $2,086,
respectively, were used to reduce custodian expenses. The remaining credits of
$1,031 for Idaho Tax Free Fund and $426 for Kansas Tax Free Fund are included in
interest income.
Sales charges paid by Class A shareholders during the period ended June 30,
1995 were $163,621 for Idaho Tax Free Fund, $42,312 for Kansas Tax Free Fund,
$7,846 for Utah Tax Free Fund and $13,715 for Washington Insured Tax Free Fund.
Of these amounts, Fund Distributors received $30,420 from Idaho Tax Free Fund,
$5,946 from Kansas Tax Free Fund, $1,307 from Utah Tax Free Fund and $2,006 from
Washington Insured Tax Free Fund. Contingent deferred sales charges paid by
Class C shareholders for the period ended June 30, 1995 were $342 for Idaho Tax
Free Fund and $104 for Kansas Tax Free Fund.
(4) ORGANIZATIONAL COSTS
Organizational costs of the Idaho Tax Free Fund are being amortized over 60
months on an inverse acceleration (sum of the years' digits) basis.
(5) SHARE TRANSACTIONS
Transactions in shares for the periods ended June 30, 1995 and December 31, 1994
were as follows:
<TABLE>
<CAPTION>
IDAHO TAX FREE FUND
A SHARES B SHARES C SHARES
PERIOD FROM PERIOD FROM PERIOD FROM
JANUARY 4, 1995* MARCH 16, 1995* JANUARY 11, 1995*
TO JUNE 30, 1995 TO JUNE 30, 1995 TO JUNE 30, 1995
(UNAUDITED) (UNAUDITED) (UNAUDITED)
<S> <C> <C> <C>
Shares sold.................... 658,996 39,273 39,137
Shares issued for
reinvested distributions.... 6,349 102 354
Shares redeemed................ (69,236) (1) (9,134)
Increase in shares
outstanding................. 596,109 39,374 30,357
</TABLE>
<TABLE>
<CAPTION>
KANSAS TAX FREE FUND
A SHARES B SHARES C SHARES
SIX MONTHS TWO MONTHS PERIOD FROM PERIOD FROM
ENDED ENDED APRIL 8, 1995* TO APRIL 12, 1995* TO
JUNE 30, 1995 DECEMBER 31, JUNE 30, 1995 JUNE 30, 1995
(UNAUDITED) 1994 (UNAUDITED) (UNAUDITED)
<S> <C> <C> <C> <C>
Shares sold.................... 162,380 118,014 8,735 2,568
Shares issued for
reinvested distributions.... 16,391 2,191 26 16
Shares redeemed................ (74,266) (17,413) (5) (1,104)
Increase in shares
outstanding................. 104,505 102,792 8,756 1,480
</TABLE>
* Commencement of operations.
<TABLE>
<CAPTION>
UTAH TAX FREE FUND
A SHARES B SHARES
SIX MONTHS TWO MONTHS PERIOD FROM
ENDED ENDED MAY 27, 1995* TO
JUNE 30, 1995 DECEMBER 31, JUNE 30, 1995
(UNAUDITED) 1994 (UNAUDITED)
<S> <C> <C> <C>
Shares sold......................... 35,776 6,326 9,430
Shares issued for
reinvested distributions......... 5,141 979 8
Shares redeemed..................... (35,495) (34,404) (1)
Increase (decrease) in shares
outstanding...................... 5,422 (27,099) 9,437
</TABLE>
<TABLE>
<CAPTION>
WASHINGTON INSURED TAX FREE FUND
A SHARES C SHARES
SIX MONTHS TWO MONTHS PERIOD FROM
ENDED ENDED APRIL 21, 1995* TO
JUNE 30, 1995 DECEMBER 31, JUNE 30, 1995
(UNAUDITED) 1994 (UNAUDITED)
<S> <C> <C> <C>
Shares sold......................... 39,915 45,596 1,743
Shares issued for
reinvested distributions......... 2,154 287 --
Shares redeemed..................... (33,451) (49,522) (1)
Increase (decrease) in shares
outstanding...................... 8,618 (3,639) 1,742
</TABLE>
* Commencement of operations.
(6) FINANCIAL HIGHLIGHTS
Per share data (rounded to the nearest cent) for a share of capital stock
outstanding and selected information for each period are as follows:
<TABLE>
<CAPTION>
IDAHO TAX FREE FUND
A SHARES B SHARES C SHARES
PERIOD FROM PERIOD FROM PERIOD FROM
JANUARY 4, 1995(d) MARCH 16, 1995(d) JANUARY 11, 1995(d)
TO JUNE 30, TO JUNE 30, TO JUNE 30,
1995 1995 1995
(UNAUDITED) (UNAUDITED) (UNAUDITED)
<S> <C> <C> <C>
Net asset value:
Beginning of period ................. $ 10.00 $ 10.50 $ 10.04
Operations:
Net investment income ............... .32 .16 .28
Net realized and unrealized
gain on investments ............... .64 .13 .60
Total from operations ........... .96 .29 .88
Distributions to shareholders:
From net investment income .......... (.32) (.16) (.28)
From distributions in excess of
net investment income ............. (.01) -- (.01)
Total distributions ............. (.33) (.16) (.29)
Net asset value:
End of period ....................... $ 10.63 $ 10.63 $ 10.63
Total investment return (b) ............ 9.50% 2.67% 8.49%
Net assets at end of period
(000's omitted) ..................... $6,339 $ 419 $ 323
Ratios:
Ratio of expenses to
average daily net assets .......... .26%(e) .83%(e) .98%(e)
Ratio of net investment income
to average daily net assets ....... 5.26%(e) 4.75%(e) 4.67%(e)
Assuming no voluntary waivers and
reimbursements and reductions:
Expenses (c) ................ 1.25%(e) 2.00%(e) 2.00%(e)
Net investment income ....... 4.27%(e) 3.58%(e) 3.65%(e)
Portfolio turnover rate (excluding
short-term securities) ............ 21.57% 21.57% 21.57%
</TABLE>
See accompanying notes to Financial Highlights.
<TABLE>
<CAPTION>
KANSAS TAX FREE FUND
A SHARES B SHARES C SHARES
SIX MONTHS PERIOD FROM PERIOD FROM PERIOD FROM
ENDED TWO MONTHS YEAR NOVEMBER 30, APRIL 8, APRIL 12,
JUNE 30, ENDED ENDED 1992(d) TO 1995(d) TO 1995(d) TO
1995 DECEMBER 31, OCTOBER 31, OCTOBER 31, JUNE 30, 1995 JUNE 30, 1995
(UNAUDITED) 1994 1994 1993 (UNAUDITED) (UNAUDITED)
<S> <C> <C> <C> <C> <C> <C>
Net asset value:
Beginning of period ...................... $ 9.50 $ 9.63 $ 10.85 $ 10.00 $ 10.19 $ 10.20
Operations:
Net investment income .................... .27 .09 .57 .56 .10 .09
Net realized and unrealized
gain (loss) on investments ............. .74 (.13) (1.21) .85 .03 .03
Total from operations ................ 1.01 (.04) (.64) 1.41 .13 .12
Distributions to shareholders:
From net investment income ............... (.28) (.09)(a) (.57)(a) (.56)(a) (.10) (.09)
From distributions in excess of
net investment income .................. (.01) -- -- -- -- --
From net realized gains .................. -- -- (.01) -- -- --
Total distributions .................... (.29) (.09) (.58) (.56) (.10) (.09)
Net asset value:
End of period .......................... $ 10.22 $ 9.50 $ 9.63 $ 10.85 $ 10.22 $ 10.23
Total investment return (b) ................. 10.53% (.38)% (6.10)% 14.49% 1.25% 1.15%
Net assets at end of period
(000's omitted) .......................... $8,987 $7,355 $6,469 $2,057 $ 89 $ 15
Ratios:
Ratio of expenses to
average daily net assets ............... .39%(e) .01%(e) .06% --% 1.10%(e) 1.38%(e)
Ratio of net investment income
to average daily net assets ............ 5.33%(e) 5.88%(e) 5.30% 5.26%(e) 3.97%(e) 3.91%(e)
Assuming no voluntary waivers
and reimbursements and
reductions:
Expenses (c) .................. 1.09%(e) 1.25%(e) 1.25% 1.25%(e) 1.65%(e) 1.65%(e)
Net investment income. 4.63%(e) 4.64%(e) 4.11% 4.01%(e) 3.42%(e) 3.64%(e)
Portfolio turnover rate (excluding
short-term securities) ................... 19.76% --% 38.96% 28.87% 19.76% 19.76%
</TABLE>
See accompanying notes to Financial Highlights.
<TABLE>
<CAPTION>
UTAH TAX FREE FUND
A SHARES B SHARES
SIX MONTHS PERIOD FROM PERIOD FROM
ENDED TWO MONTHS OCTOBER 5, MAY 27,
JUNE 30, ENDED 1992(d) TO 1995(d) TO
1995 DECEMBER 31, YEAR ENDED OCTOBER 31, OCTOBER 31, JUNE 30, 1995
(UNAUDITED) 1994 1994 1993 1992 (UNAUDITED)
<S> <C> <C> <C> <C> <C> <C>
Net asset value:
Beginning of period ............... $ 9.80 $ 9.94 $ 11.07 $ 10.00 $10.00 $ 10.63
Operations:
Net investment income ............. .28 .10 .60 .65 -- .04
Net realized and unrealized
gain (loss) on investments ...... .72 (.15) (1.07) 1.07 -- (.13)
Total from operations ........... 1.00 (.05) (.47) 1.72 -- (.09)
Distributions to shareholders:
From net investment income ........ (.29) (.09)(a) (.60)(a) (.65)(a) -- (.04)
Distributions in excess of net
investment income ............... (.01) -- -- -- -- --
From net realized gains ........... -- -- (.06) -- -- --
Total distributions ............. (.30) (.09) (.66) (.65) -- (.04)
Net asset value:
End of period ..................... $ 10.50 $ 9.80 $ 9.94 $ 11.07 $10.00 $ 10.50
Total investment return (b) .......... 10.19% (.41)% (4.50)% 17.54% --% (0.91)%
Net assets at end of period
(000's omitted) ................... $4,052 $3,728 $4,054 $3,913 $ 19 $ 99
Ratios:
Ratio of expenses to
average daily net assets ........ .46%(e) .11%(e) .10% --% --% 1.02%(e)
Ratio of net investment income
to average daily net assets ..... 5.51%(e) 6.38%(e) 5.64% 5.65% --% 3.30%(e)
Assuming no voluntary waivers
and reimbursements and
reductions:
Expenses (c) .......... 1.24%(e) 1.14%(e) 1.25% 1.25% --% 1.75%(e)
Net investment income . 4.73%(e) 5.35%(e) 4.49% 4.40% --% 2.57%(e)
Portfolio turnover rate (excluding
short-term securities) ............ 22.95% --% 2.77% 44.54% --% 22.95%
</TABLE>
See accompanying notes to Financial Highlights.
<TABLE>
<CAPTION>
WASHINGTON INSURED TAX FREE FUND
A SHARES C SHARES
SIX MONTHS PERIOD FROM PERIOD FROM
ENDED TWO MONTHS YEAR AUGUST 1, APRIL 21,
JUNE 30, ENDED ENDED 1993(d) TO 1995(d) TO
1995 DECEMBER 31, OCTOBER 31, OCTOBER 31, JUNE 30, 1995
(UNAUDITED) 1994 1994 1993 (UNAUDITED)
<S> <C> <C> <C> <C> <C>
Net asset value:
Beginning of period ................. $ 9.21 $ 9.37 $ 10.67 $ 10.00 $ 9.94
Operations:
Net investment income ............... .28 .09 .55 .15 .08
Net realized and unrealized
gain (loss) on investments ........ .76 (.16) (1.26) .67 .02
Total from operations ............. 1.04 (.07) (.71) .82 .10
Distributions to shareholders:
From net investment income .......... (.28) (.09)(a) (.57)(a) (.15)(a) (.08)
From distributions in excess of
net investment income ............. (.01) -- -- -- --
From net realized gains ............. -- -- (.02) -- --
Total distributions ............... (.29) (.09) (.59) (.15) (.08)
Net asset value:
End of period ....................... $ 9.96 $ 9.21 $ 9.37 $ 10.67 $ 9.96
Total investment return (b) ............ 11.29% (0.69)% (6.85)% 8.05% 0.98%
Net assets at end of period
(000's omitted) ..................... $2,301 $2,049 $2,118 $2,108 $ 17
Ratios:
Ratio of expenses to
average daily net assets .......... .09%(e) .10%(e) .14% --% 1.09%(e)
Ratio of net investment income
to average daily net assets ....... 5.64%(e) 6.18%(e) 5.44% 5.50%(e) 4.11%(e)
Assuming no voluntary waivers and
reimbursements and reductions:
Expenses (c) ................ 1.25%(e) 1.25%(e) 1.25% 1.25%(e) 1.57%(e)
Net investment income ....... 4.48%(e) 5.03%(e) 4.33% 4.25%(e) 3.63%(e)
Portfolio turnover rate (excluding
short-term securities) .............. 15.12% --% --% 45.14% 15.12%
</TABLE>
See accompanying notes to Financial Highlights.
NOTES TO FINANCIAL HIGHLIGHTS
(a) For federal income tax purposes, all of the net investment income
distributions were derived from interest on securities exempt from federal
income tax. For the year ended October 31, 1994, $.01 per share of the
distributions from net investment income was subject to state income tax
for Kansas Tax Free Fund.
(b) Total investment return is based on the change in net asset value of a
share during the period and assumes reinvestment of distributions at net
asset value and does not reflect the impact of a sales charge.
(c) Voyageur and Fund Distributors voluntarily waived or reimbursed expenses
during the periods presented. The annual contractual expense limit for each
Fund (excluding distribution fees, insurance premiums on portfolio
securities, taxes, interest and brokerage commissions) is 1% of average
daily net assets. The maximum distribution fee is .25% of each Fund's
average daily net assets for Class A Shares and 1.00% of each Fund's
average daily net assets for Class B and Class C Shares.
(d) Commencement of operations.
(e) Adjusted to an annual basis.
<TABLE>
<CAPTION>
VOYAGEUR IDAHO TAX FREE FUND
INVESTMENTS IN SECURITIES (UNAUDITED) JUNE 30, 1995
PRINCIPAL
AMOUNT COUPON MARKET
($000) NAME OF ISSUER (d) RATE MATURITY VALUE (a)
(PERCENTAGE OF EACH INVESTMENT CATEGORY RELATES TO TOTAL NET ASSETS.)
MUNICIPAL BONDS (100.9%):
GENERAL OBLIGATION (43.6%):
<S> <C> <C> <C> <C>
$300 Boise City School District UTGO (AMBAC Insured)...................... 5.40% 07-30-14 $ 290,859
150 Bonner County Local Improvement District #93-1....................... 6.20 04-30-05 152,407
185 Bonner County Local Improvement District #93-1....................... 6.35 04-30-06 188,550
195 Bonner County Local Improvement District #93-1....................... 6.40 04-30-07 198,101
110 Bonner County Local Improvement District #93-1....................... 6.50 04-30-08 111,740
100 Bonner County Local Improvement District #93-1....................... 6.50 04-30-10 100,492
450 Bonneville & Bingham County School District #93
GO (FGIC Insured).................................................. 5.50 07-30-10 448,614
590 Canyon County School District #131 (MBIA Insured).................... 5.50 07-30-12 581,634
250 Canyon County School District #139................................... 5.20 08-01-11 239,943
100 Canyon County School District #139................................... 5.20 08-01-12 95,245
85 Coeur D' Alene Local Improvement District #6
Series 1995........................................................ 6.00(c) 07-01-09 83,549
90 Coeur D' Alene Local Improvement District #6
Series 1995........................................................ 6.05(c) 07-01-10 88,436
40 Coeur D' Alene Local Improvement District #6
Series 1995........................................................ 6.10(c) 07-01-12 39,254
45 Coeur D' Alene Local Improvement District #6
Series 1995........................................................ 6.10(c) 07-01-14 44,109
100 Gooding Lincoln School District #231
(Capital Guaranty Insured)......................................... 6.30 02-01-14 104,259
100 Madison County School District #321 (AMBAC Insured).................. 5.60 02-01-08 101,239
225 Twin Falls School District #413 (AMBAC Insured)...................... 5.25 07-30-12 217,687
3,086,118
UTILITIES (7.1%):
125 Chubbock Water Revenue................................................. 6.35 04-01-08 126,522
135 Chubbock Water Revenue................................................. 6.40 04-01-10 135,177
100 Puerto Rico Electric Authority (FSA Insured)........................... 6.00 07-01-16 100,375
150 Puerto Rico Telephone Revenue Authority................................ 5.50 01-01-22 140,676
502,750
TRANSPORTATION (4.5%):
150 Guam Highway (Capital Guaranty Insured)................................ 6.30 05-01-12 155,063
175 Puerto Rico Highway Revenue Series W................................... 5.50 07-01-15 164,850
319,913
INDUSTRIAL (7.8%):
130 Boise-Kuna Lucy Peak Hydroelectric..................................... 6.00 07-01-08 133,210
100 Idaho State Water Resource Boise Water................................. 7.25(e) 12-01-21 107,650
150 Puerto Rico Pepsico Project Series A................................... 6.25 11-15-13 153,829
175 Puerto Rico Public Building Authority Revenue.......................... 5.50 07-01-21 161,014
555,703
HEALTH CARE (18.8%):
500 Idaho Magic Valley Health Facilities (AMBAC Insured)................... 5.63 12-01-13 495,900
500 Idaho St. Alphonsus Health Facility.................................... 6.25 12-01-22 512,095
340 Idaho St. Joseph Regional Medical (MBIA Insured)....................... 5.25 07-01-13 322,884
1,330,879
HOUSING (10.8%):
255 Idaho State Housing Finance Authority Series C-2....................... 6.35(e) 07-01-15 253,569
100 Idaho State Single Family Housing Authority Revenue Series A1.......... 6.85 07-01-12 103,305
200 Idaho State Single Family Housing Finance Authority ................... 6.60 07-01-11 204,464
200 Idaho State Single Family Mortgage Series 95B (FHA Insured) ........... 6.45(e) 07-01-15 200,480
761,818
EDUCATION (8.3%):
300 Idaho State University (MBIA Insured).................................. 5.80(c) 04-01-20 296,250
300 University of Idaho Revenue Facility Improvement....................... 5.35 04-01-10 290,178
586,428
TOTAL MUNICIPAL BONDS (cost: $7,061,911) $7,143,609
SHORT-TERM SECURITIES (3.8%):
267 Nuveen Investment Tax-Free Fund (cost: $267,470)....................... 3.81(b) $ 267,470
TOTAL INVESTMENTS IN SECURITIES (cost: $7,329,381) (f) $7,411,079
</TABLE>
See accompanying notes to investments in securities.
<TABLE>
<CAPTION>
VOYAGEUR KANSAS TAX FREE FUND
INVESTMENTS IN SECURITIES (UNAUDITED) JUNE 30, 1995
PRINCIPAL
AMOUNT COUPON MARKET
($000) NAME OF ISSUER (d) RATE MATURITY VALUE (a)
(PERCENTAGE OF EACH INVESTMENT CATEGORY RELATES TO TOTAL NET ASSETS.)
MUNICIPAL BONDS (97.7%):
GENERAL OBLIGATION (50.9%):
<S> <C> <C> <C> <C>
$240 Allen County United School District #258 (AMBAC Insured)............... 6.88% 09-01-10 $ 276,300
405 Atchison County United School District #409 (Capital Guaranty Insured). 5.34 09-01-15 384,665
245 Dodge City School District #443 (Capital Guaranty Insured)............. 5.00 03-01-11 227,042
215 Dodge City School District #443 (Capital Guaranty Insured)............. 5.00 03-01-14 195,239
250 Douglas County Lawrence United School District #497.................... 6.00 09-01-15 252,543
250 Jefferson County United School District #340 (Capital Guaranty Insured) 6.35 09-01-15 258,522
750 Johnson County......................................................... 6.13 09-01-12 765,098
250 Puerto Rico Commonwealth (AMBAC Insured)............................... 5.85 07-01-15 248,437
250 Riley County School District #383...................................... 5.10 11-01-14 229,967
250 Sedgwick County Maize United School District #266
(Capital Guaranty Insured)........................................... 5.88 09-01-12 251,940
250 Sedgwick County Renwick United School District #267 (AMBAC Insured).... 6.15 11-01-09 261,520
250 Sedgwick County United School District #265 (Capital Guaranty Insured). 5.50 10-01-13 242,505
130 Shawnee County School District #437 (AMBAC Insured).................... 5.25 09-01-10 124,743
200 Shawnee County School District #501 (FGIC Insured)..................... 5.75 02-01-11 200,598
250 Shawnee County United School District #345 (MBIA Insured).............. 5.75 09-01-11 250,860
250 Summer County United School District #356 (MBIA Insured).............. 5.75 09-01-11 250,932
250 Wichita Series #735.................................................... 4.00 09-01-09 211,245
4,632,156
UTILITIES (18.1%):
500 Hutchinson Water & Sewer (AMBAC Insured)............................... 5.00 12-01-11 461,790
175 Johnson County Water Revenue........................................... 5.25 12-01-15 162,183
900 Kansas City Utility System Revenue (FGIC Insured)...................... 6.38 09-01-23 928,179
100 Salina Water & Sewer Revenue (MBIA Insured)............................ 5.25 09-01-12 94,460
1,646,612
TRANSPORTATION (7.2%):
350 Kansas Department of Transportation.................................... 5.38 03-01-13 332,672
250 Kansas Department of Transportation Highway Revenue.................... 5.00 09-01-12 227,417
100 Kansas Turnpike Authority (AMBAC Insured).............................. 5.25 09-01-13 94,071
654,160
INDUSTRIAL (3.3%):
250 Kansas Development Finance Authority Water Pollution Control........... 6.00 11-01-14 251,580
50 Wamego Pollution Control Revenue Western Resources Inc. Project
(MBIA Insured)....................................................... 6.00 02-01-33 49,702
301,282
HEALTH CARE (11.5%):
250 Lawrence Memorial Hospital............................................. 6.20 07-01-19 246,620
250 Olathe Good Samaritan Lutheran Health (AMBAC Insured).................. 6.00 05-01-19 251,458
100 Olathe Health Facility (AMBAC Insured)................................. 5.88 09-01-16 99,991
250 Shawnee County Sister of Charity Hospital Revenue...................... 5.00 12-01-10 230,420
250 Shawnee County Sister of Charity Hospital (Capital Guaranty Insured)... 5.00 12-01-23 215,485
1,043,974
HOUSING (3.3%):
50 Martin Creek Multifamily Housing Revenue (FHA Insured)................. 6.50 08-01-24 50,379
250 Olathe Multifamily Deerfield Apartment Series 1994A (FNMA Insured)..... 6.45 06-01-19 251,925
302,304
EDUCATION (3.4%):
300 Kansas City Community College (MBIA Insured)........................... 6.25 05-15-20 305,487
TOTAL INVESTMENTS IN SECURITIES (cost: $8,760,201) (f) $8,885,975
</TABLE>
See accompanying notes to investments in securities.
<TABLE>
<CAPTION>
VOYAGEUR UTAH TAX FREE FUND
INVESTMENTS IN SECURITIES (UNAUDITED) JUNE 30, 1995
PRINCIPAL
AMOUNT COUPON MARKET
($000) NAME OF ISSUER (d) RATE MATURITY VALUE (a)
(PERCENTAGE OF EACH INVESTMENT CATEGORY RELATES TO TOTAL NET ASSETS.)
UTAH MUNICIPAL BONDS (97.6%):
GENERAL OBLIGATION (12.0%):
<S> <C> <C> <C> <C>
$100 Cache County School District (AMBAC Insured)........................... 5.90% 06-15-13 $ 100,040
100 Davis County School District (MBIA Insured)............................ 5.80 06-01-08 101,381
100 Provo City Independent School District................................. 6.25 06-15-13 101,382
100 Salt Lake County Service Area #1....................................... 6.00 12-15-12 98,720
100 Weber County (FGIC Insured)............................................ 5.63 01-15-11 98,021
499,544
UTILITIES (23.8%):
250 Provo City Energy System Revenue (MBIA Insured)........................ 5.75 05-15-14 244,273
100 St. George Washington County Water & Sewer (AMBAC Insured)............. 5.38 06-01-16 93,337
300 Salt Lake City Water Conservation (AMBAC Insured)...................... 5.30 10-01-13 280,443
200 Utah Associated Municipal Power Systems................................ 5.25 12-01-09 185,768
200 Utah State Municipal Power Agency Electric (FGIC Insured).............. 5.25 07-01-18 182,116
985,937
TRANSPORTATION (5.9%):
250 Salt Lake City Airport Revenue (FGIC Insured).......................... 5.88 12-01-18 245,773
INDUSTRIAL (18.0%):
200 Emery County Pollution Control (AMBAC Insured)......................... 5.65 11-01-23 189,202
100 Salt Lake County Municipal Building Authority Lease Revenue Series A... 6.38 10-01-12 101,981
100 Salt Lake County Pollution Kennecott Corporation....................... 6.55 10-01-12 104,000
100 Utah State Building Authority Lease Revenue............................ 5.75 08-15-08 99,993
250 West Valley City Municipal Building Authority Lease Revenue
(MBIA Insured)....................................................... 6.00 01-15-10 251,798
746,974
HEALTH CARE (2.2%):
100 Salt Lake City Hospital................................................ 5.50 02-15-21 92,511
HOUSING (16.3%):
175 Salt Lake City Multifamily Housing Authority........................... 6.00 04-01-25 178,938
200 Utah Housing Finance Authority Multifamily Cottonwood Project
(FNMA Insured)....................................................... 6.30 07-01-15 200,972
100 Utah Housing Finance Authority Single Family Mortgage Series 1992D-1... 6.70 07-01-12 94,698
200 Utah Housing Finance Authority Single Family Mortgage Revenue 1994C.... 6.30 07-01-16 201,216
675,824
EDUCATION (19.4%):
200 Beaver County School District (AMBAC Insured).......................... 5.20 12-15-12 185,342
100 Iron County School District (MBIA Insured)............................. 6.50 01-15-13 105,036
150 Southern Utah University Board of Regents (MBIA Insured)............... 6.35 05-01-10 157,286
100 Utah State University Board of Regents (AMBAC Insured)................. 6.30 06-01-12 102,698
150 Utah State University Revenue (MBIA Insured)........................... 6.15 12-01-14 151,986
100 Weber State University Board of Regents (MBIA Insured)................. 6.25 04-01-10 102,581
804,929
TOTAL MUNICIPAL BONDS (cost: $4,079,390) $4,051,492
SHORT-TERM SECURITIES (1.3%):
55 Nuveen Investment Tax-Free Fund (cost: $55,000)........................ 3.81 (b) $ 55,000
TOTAL INVESTMENTS IN SECURITIES (cost: $4,134,390) (f) $4,106,492
</TABLE>
See accompanying notes to investments in securities.
<TABLE>
<CAPTION>
VOYAGEUR WASHINGTON INSURED TAX FREE FUND
INVESTMENTS IN SECURITIES (UNAUDITED) JUNE 30, 1995
PRINCIPAL
AMOUNT COUPON MARKET
($000) NAME OF ISSUER (d) RATE MATURITY VALUE (a)
(PERCENTAGE OF EACH INVESTMENT CATEGORY RELATES TO TOTAL NET ASSETS.)
WASHINGTON MUNICIPAL BONDS (96.0%):
GENERAL OBLIGATION REVENUE (20.8%):
<S> <C> <C> <C> <C>
$100 Benton County Independent School District #116 G.O. (FGIC Insured)..... 5.80% 12-01-10 $ 99,641
75 Bothell G.O. (AMBAC Insured)........................................... 5.70 12-01-10 74,088
175 Jefferson County Public Hospital District #2 (FGIC Insured)............ 5.20 12-01-12 160,349
75 King County Kent School District #415 G.O. (MBIA Insured).............. 5.55 12-01-11 72,874
75 Snohomish County G.O. (MBIA Insured)................................... 5.90 12-01-15 74,380
481,332
UTILITIES (32.3%):
100 Asotin County Water Revenue (AMBAC Insured)............................ 5.60 03-01-12 96,632
100 Centralia Water & Sewer (AMBAC Insured)................................ 5.65 08-01-11 97,726
100 Clark County Public Utility Revenue District #1 G.O. (AMBAC Insured)... 5.50 01-01-15 94,628
75 Covington Water & Sewer Revenue (AMBAC Insured)........................ 6.00 03-01-15 74,907
100 Kent Water & Sewer Revenue (AMBAC Insured)............................. 5.50 11-01-13 95,150
100 Metropolitan Seattle G.O. Sewer Refund (AMBAC Insured)................. 5.45 01-01-18 93,142
100 Seattle Metropolitan Sewer Revenue (FGIC Insured)...................... 5.70 01-01-14 97,186
100 Yakima-Tieton Irrigation District (FSA Insured)........................ 6.13 06-01-13 100,568
749,939
EDUCATION (16.5%):
75 Clark County School District G.O. (FGIC Insured)....................... 6.00 12-01-11 75,409
200 Washington State Housing & Dining System (MBIA Insured)................ 6.38 10-01-18 204,712
100 Western Washington University Housing & Dining System (MBIA Insured)... 6.38 10-01-22 101,703
381,824
INDUSTRIAL (3.3%):
75 University of Washington Parking Revenue (AMBAC Insured)............... 6.13 11-01-14 75,369
HEALTH CARE (23.1%):
200 University of Washington Medical Center (Capital Guaranty Insured)..... 6.30 08-15-14 204,078
250 Washington State Health Care (Connie Lee Insured)...................... 5.75 06-01-20 236,713
100 Washington State Health Multicare Medical Center (FGIC Insured)........ 5.75 08-15-22 95,508
536,299
TOTAL MUNICIPAL BONDS (cost: $2,259,691) $2,224,763
SHORT-TERM SECURITIES (3.4%):
78 Nuveen Investment Tax-Free Fund (cost $78,090)......................... 3.81 (b) $ 78,090
TOTAL INVESTMENTS IN SECURITIES (cost: $2,337,781)(f) $2,302,853
</TABLE>
See accompanying notes to investments in securities.
VOYAGEUR IDAHO TAX FREE FUND
VOYAGEUR KANSAS TAX FREE FUND
VOYAGEUR UTAH TAX FREE FUND
VOYAGEUR WASHINGTON INSURED TAX FREE FUND
NOTES TO INVESTMENTS IN SECURITIES (UNAUDITED)
(a) Securities are valued by procedures described in note 1 to the financial
statements.
(b) Dividend yields change daily to reflect current market conditions. Rate
shown is the quoted yield as of June 30, 1995.
(c) At June 30, 1995, the cost of securities purchased on a when-issued basis
was $557,750 for Idaho Tax Free Fund.
(d) Investments in bonds, by rating category as a percentage of total bonds,
are as follows:
<TABLE>
<CAPTION>
Non-
Aaa/AAA Aa/AA A/A rated Total
<S> <C> <C> <C> <C> <C>
Idaho Tax Free Fund.................... 50% 13% 19% 18% 100%
Kansas Tax Free Fund................... 67% 30% 3% -- 100%
Utah Tax Free Fund..................... 74% 12% 14% -- 100%
Washington Insured Tax Free Fund....... -- -- -- -- 100%
</TABLE>
(e) These securities are subject to the Alternative Minimum Tax.
(f) Also represents the cost of securities for federal income tax purposes and
the aggregate gross unrealized appreciation and depreciation in securities
based on these costs were as follows:
<TABLE>
<CAPTION>
Net
Gross Gross Unrealized
Unrealized Unrealized Appreciation/
Appreciation (Depreciation) (Depreciation)
<S> <C> <C> <C>
Idaho Tax Free Fund.................... 107,377 (25,679) 81,698
Kansas Tax Free Fund................... 239,089 (113,315) 125,774
Utah Tax Free Fund..................... 52,990 (80,888) (27,898)
Washington Insured Tax Free Fund....... 18,996 (53,924) (34,928)
</TABLE>
INVESTMENT ADVISER, TRANSFER AGENT,
DIVIDEND DISBURSING AGENT AND
ACCOUNTING SERVICES AGENT
Voyageur Fund Managers, Inc.
90 South Seventh Street, Suite 4400
Minneapolis, Minnesota 55402
UNDERWRITER
Voyageur Fund Distributors, Inc.
90 South Seventh Street, Suite 4400
Minneapolis, Minnesota 55402
CUSTODIAN
Norwest Bank Minnesota, N.A.
Sixth Street & Marquette Avenue
Minneapolis, Minnesota 55479
GENERAL COUNSEL
Dorsey & Whitney P.L.L.P.
Minneapolis, Minnesota 55402
AUDITORS
KPMG Peat Marwick LLP
Minneapolis, Minnesota 55402
VOYAGEUR
IDAHO TAX FREE FUND
KANSAS TAX FREE FUND
UTAH TAX FREE FUND
WASHINGTON INSURED TAX FREE FUND
SEMI-ANNUAL REPORT
Dated June 30, 1995
INVESTMENT ADVISER, TRANSFER AGENT,
DIVIDEND DISBURSING AGENT AND
ACCOUNTING SERVICES AGENT
Voyageur Fund Managers, Inc.
90 South Seventh Street, Suite 4400
Minneapolis, Minnesota 55402
UNDERWRITER
Voyageur Fund Distributors, Inc.
90 South Seventh Street, Suite 4400
Minneapolis, Minnesota 55402
CUSTODIAN
Norwest Bank Minnesota, N.A.
Sixth Street & Marquette Avenue
Minneapolis, Minnesota 55479
GENERAL COUNSEL
Dorsey & Whitney P.L.L.P.
Minneapolis, Minnesota 55402
AUDITORS
KPMG Peat Marwick LLP
Minneapolis, Minnesota 55402
BULK RATE
U.S. Postage
PAID
Minneapolis, MN.
Permit #3322
VOYAGEUR
90 SOUTH SEVENTH STREET, SUITE 4400
MINNEAPOLIS, MINNESOTA 55402.4115
