VOYAGEUR INVESTMENT TRUST, N-30D, 1997-09-08

VOYAGEUR INVESTMENT TRUST
N-30D, 1997-09-08

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<PAGE>

For Tax-Exempt Income

DELAWARE-VOYAGEUR

Tax-Free Idaho Fund
Tax-Free Oregon Insured Fund
Tax-Free Washington Insured Fund

1997
Semi-Annual Report

professional management

service and guidance

goals

DELAWARE
GROUP
========

<PAGE>
- --------------------------------------------------------------------------------
JULY 15, 1997

Dear Shareholder,
I AM PLEASED TO PRESENT OUR FIRST SHAREHOLDER REPORT FOR THREE single-state,
tax-exempt funds in our country's Northwest since the Voyageur funds joined the
Delaware family on April 30, 1997.
On behalf of all of us here at Delaware, I welcome you to an
organization of experienced financial professionals dedicated to helping you
reach your investment goals. Delaware has managed municipal bond investments for
more than 20 years and pioneered the concept of single-state, tax-exempt funds.
I am delighted to report that during this transition period, each Fund's
performance was competitive with its unmanaged benchmark, as shown on pages 9
and 10. Elizabeth H. Howell, the Funds' portfolio manager under Voyageur,
continues to oversee all three portfolios from her office in Minneapolis.
We view the municipal bond market's long-term prospects as very
attractive, particularly in an area with an economy as robust as that of the
Northwest. Municipal bond prices have generally been stronger than U.S.
Treasuries* during 1997, despite federal tax changes in Washington and a modest
tightening of monetary policy by the Federal Reserve Board.

IN THE COMING YEARS, WE BELIEVE IT WILL BECOME MORE IMPORTANT THAN EVER TO
CONSIDER THE IMPACT OF TAXES ON THE PERFORMANCE OF AN INVESTMENT PORTFOLIO.

As our nation's leaders grapple with tax issues and states take on a
greater fiscal responsibility for managing social and public works programs, we
believe it will become more important than ever to consider the impact of taxes
on the performance of an investment portfolio.
When Delaware offered its first municipal bond fund in 1977, federal
taxpayers were able to take many more deductions on their tax returns than they
can take today. Among these were:
* Interest on student and consumer loans,
* More extensive job-related moving expenses,
* Sales and gasoline taxes; and,
* Aportion of dividend income.

*PRINCIPAL AND INTEREST OF U.S. TREASURIES IS GUARANTEED BY THE U.S. GOVERNMENT.
PRINCIPAL AND INTEREST OF MUNICIPAL BONDS MAY OR MAY NOT BE GUARANTEED BY A
STATE, LOCAL GOVERNMENT ENTITY OR PRIVATE INSURER.

1997 semi-annual report
<PAGE>

In our opinion, the income from municipal bonds and the tax-free
compounding of such income over time has the potential to help investors reach
their financial goals more quickly.
On the pages that follow, Ms. Howell reviews each Fund's performance and
outlines her approach for the coming months. We look forward to reporting to you
again in 1998 and serving your needs for many years to come.

Sincerely,

/s/ Wayne A. Stork

Wayne A. Stork
CHAIRMAN, PRESIDENT AND CHIEF EXECUTIVE OFFICER

tax-exempt income

Your Funds' Portfolio Manager

Prior to joining the Delaware-Voyageur family, Elizabeth H. Howell had managed
municipal bond funds at Voyageur Asset Management for six years. Ms. Howell has
had more than 13 years of investment experience that includes serving as a
fixed- income portfolio manager at Windsor Financial Group and
investment-management positions at Loomis Sayles & Co. and Eaton Vance
Management. Ms. Howell has an MBA from Babson College.

ELIZABETH H. HOWELL

3
1997 semi-annual report

<PAGE>

Performance Review

Delaware-Voyageur's municipal bond funds in Idaho, Oregon and Washington
provided attractive total returns during the first half of fiscal 1997 despite
substantial interest rate volatility and renewed efforts in Washington, D.C. to
cut income taxes.
Nationwide, our country's output of goods and services grew at a robust
pace in the first quarter. This prompted the Federal Reserve to raise its target
for short-term interest rates by a modest 25 basis points (0.25%) to 5.5% in an
effort to forestall inflation.
As the second calendar quarter of 1997 progressed, the bond market
welcomed news of possible slower U.S. economic growth. By the end of June,
long-term U.S. Treasury bonds yielded 6.78%, compared to more than 7% just a few
months earlier.

IN MANAGING EACH FUND'S PORTFOLIO, WE SEEK TO ACHIEVE GOOD STRUCTURE - A PRUDENT
COMBINATION OF AVERAGE COUPON, CALL DATE, AND EFFECTIVE MATURITY.

In managing each Fund's portfolio, we seek to achieve good structure - a
prudent combination of average coupon, call date, and effective maturity that
represent the mathematical underpinnings of the portfolio. By managing duration
as market conditions warranted, we sought to maximize each Fund's income and
total return potential.

TAX-FREE IDAHO FUND
STRATEGIC POSITIONING
AND OUTLOOK
For the first half of fiscal 1997, Tax-Free Idaho Fund outperformed its
unmanaged benchmark, the Lehman Brothers Municipal Bond Index. The Fund provided
a total return of +3.61% for the six months ended June 30 (capital change for
Class A shares plus reinvested dividends at net asset value).
We believe the Fund's results can be attributed to our positioning the
Fund for a decline in interest rates. Duration, at 8.9 years, was longer than
that of its peers. This allowed the Fund to achieve a relatively high rate of
return in May and June as interest rates declined and bond prices rose.
Tax-Free Idaho invests in investment and non-investment grade bonds. At
the end of June, the Fund had allocated 83% of its net assets to investment
grade bonds and 17% to unrated bonds.

4
1997 semi-annual report

<PAGE>

This reflects the fact that Idaho is an unusual state from a municipal
bond perspective. Many of the issues available to investors are small municipal
projects that are too small to make it economically feasible to get a rating
from Moody's or Standard & Poor's. Indeed, the state does not issue general
obligation bonds and as of June 30 had issued just $262 million in municipal
securities this year.
In selecting bonds for the Fund's portfolio, our experienced team of
municipal bond analysts carefully evaluate creditworthiness. We only purchase
unrated bonds that meet our high standards - securities we judge to be
comparable in quality to investment grade bonds. We continually search for small
creditworthy issues that reward investors with incremental income. Our general
approach to managing the portfolio is to balance bonds that produce an
above-average interest rate with bonds that are rated and can contribute to the
Fund's total return.
Idaho has a current population of more than 1 million and during fiscal
1996 had a state budget surplus of $11 million on revenue of $1.35 billion.
While agriculture and mining have historically been the state's top industries,
Idaho also has a growing high-tech sector. We've increased our allocation to
Idaho industrial development bonds over the past year. We are confident we can
maintain a prudent blending of bond sectors.

TAX-FREE IDAHO FUND
PORTFOLIO HIGHLIGHTS AND ASSET ALLOCATION
- --------------------------------------------------------------------------------
June 30, 1997

Certificates of Participation 2.7%
General Obligation 12.0%
Power Authority 3.4%
Hospitals 15.5%
Cash 1.5%
Other Revenue Bonds 19.7%
Pollution Control 14.7%
Water/Sewer/Utility 4.5%
Higher Education 5.1%
Housing 12.1%
Industrial Development 8.7%

- -------------------------------------------------
Average Effective Maturity 12.4 years
Average Effective Duration 8.9 years
Average Quality A
Thirty-Day Current SEC Yield* 4.88%

*FOR A CLASS SHARES BASED ON SECURITIES AND EXCHANGE COMMISSION GUIDELINES.
SEC YIELDS FOR B AND C CLASSES WERE 4.58% AND 4.33% RESPECTIVELY.

APPROXIMATELY 15.4% OF THE INCOME GENERATED BY THE FUND FOR THE SIX MONTHS ENDED
JUNE 30, 1997, WAS SUBJECT TO THE ALTERNATIVE MINIMUM TAX.

5
1997 semi-annual report

<PAGE>

TAX-FREE OREGON INSURED FUND
PORTFOLIO HIGHLIGHTS AND ASSET ALLOCATION
- --------------------------------------------------------------------------------
June 30, 1997

Higher Education 10.7%
Power Authority 6.6%
Cash 4.8%
Other Revenue Bonds 3.7%
Pre-Refunded Bonds 3.0%
Housing 4.2%
Transportation 7.4%
Hospitals 7.6%
Water/Sewer 15.4%
Certificates of Participation 3.7%
General Obligation 32.9%

- -------------------------------------------------
Average Effective Maturity 10.5 years
Average Effective Duration 8.5 years
Average Quality AAA
Thirty-Day Current SEC Yield* 4.54%

*FOR CLASS A SHARES BASED ON SECURITIES AND EXCHANGE COMMISSION GUIDELINES.
SEC YIELDS FOR B AND C CLASSES WERE 4.08% AND 3.86% RESPECTIVELY.

APPROXIMATELY 12.3% OF THE INCOME GENERATED BY THE FUND FOR THE SIX MONTHS ENDED
JUNE 30, 1997, WAS SUBJECT TO THE ALTERNATIVE MINIMUM TAX.

TAX-FREE OREGON
INSURED FUND
STRATEGIC POSITIONING
AND OUTLOOK
Tax-Free Oregon Insured Fund provided a total return term of +2.99% for the six
months ended June 30, 1997 (capital change for Class A shares plus reinvested
dividends at net asset value).
Our performance was not as strong as the Fund's unmanaged benchmark, the
Lehman Brothers Insured Municipal Bond Index. The Fund's returns were higher
than the average return of +2.68% provided by Tax-Free Oregon Insured's peers
for the period, as measured by Lipper Analytical Services.
Your Fund's results reflect high investor demand and relatively low
supply of new municipal securities in the state. Through June 30, new bond
issuance had dropped 23% compared to a year ago, from $725 million to $555
million, according to THE BOND BUYER, a trade publication.
For both median and upper income households, Oregon has a steep 9%
marginal tax rate. During fiscal 1997 the state's governor, John Kitzhaber, was
described by the Cato Institute, an independent tax watchdog, as having proposed
"the fastest spending increases" of any governor elected in the past three
years.
Nevertheless, the state's overall bond rating remains a solid AA. For
the state's 1997 fiscal year, it posted a healthy $536 million budget surplus on
revenues of $7.4 billion. To help preserve principal, the Fund invests
exclusively in bonds that are insured by one of the major municipal bond
insurance companies and are rated AAA by Moody's and/or Standard & Poor's.
Since December, our emphasis has been on bonds with discount coupons,
good call protection, and long maturities. Pursuing this strategy allowed the
fund to perform

6
1997 semi-annual report
<PAGE>

well, on a risk-adjusted basis, despite 1997's volatile interest rate
environment. In the coming months, we expect to continue to maintain a duration,
or sensitivity to interest rates, that is about a year longer than that of our
benchmark.
Oregon's annual economic growth rate of 4.9% ranks 7th nationwide, led
by the forestry, agriculture, manufacturing and tourism. Such diversity gives us
reason to be cautiously optimistic about the state's finances.

TAX-FREE WASHINGTON
INSURED FUND
STRATEGIC POSITIONING
AND OUTLOOK
Tax-Free Washington Insured Fund outperformed its unmanaged benchmark, the
Lehman Brothers Insured Municipal Bond Index, for the six months ended June
30. The Fund provided a total return of +3.44% (capital change for Class A
shares plus reinvested dividends at net asset value).
Washington is one of a handful of states that do not have a state income
tax. Two advantages of owning municipal bonds for Washington residents is that
the income they generate is exempt from federal income taxes. Washington bonds
also tend to yield more than bonds of other states. The state is home to many
investors in high federal tax brackets. Per capita ranks 15th nationwide.
Unlike many states, Washington has issued substantially more municipal
bonds in 1997 compared to a year ago. Through June 30, supply had risen 47.8% to
$2.5 billion, making the state one of the nation's top 10 issuers of new
tax-exempt debt, according to THE BOND BUYER, a trade publication. Strong
investor demand helped stabilize bond prices during the period.
Tax-Free Washington Insured Fund did well relative to the Lehman Index
and its peers since December because we positioned the

TAX-FREE WASHINGTON INSURED FUND
PORTFOLIO HIGHLIGHTS AND ASSET ALLOCATION
- --------------------------------------------------------------------------------
June 30, 1997

Housing 27.0%
Hospitals 13.0%
General Obligation 20.0%
Industrial Development 2.5%
Water/Sewer 8.3%
Cash 6.2%
Power Authority 9.7%
Higher Education 13.3%

- -------------------------------------------------
Average Effective Maturity 10.2 years
Average Effective Duration 8.5 years
Average Quality AAA
Thirty-Day Current SEC Yield* 5.03%

*FOR CLASS A SHARES BASED ON SECURITIES AND EXCHANGE COMMISSION GUIDELINES.
SEC YIELDS FOR B AND C CLASSES WERE 4.45% AND 4.35% RESPECTIVELY.

APPROXIMATELY 10.6% OF THE INCOME GENERATED BY THE FUND FOR THE SIX MONTHS ENDED
JUNE 30, 1997, WAS SUBJECT TO THE ALTERNATIVE MINIMUM TAX.

7
1997 semi-annual report
<PAGE>

Fund for a decline in interest rates. The Fund's duration, at 8.5 years, was
nearly nine months longer than the index. We believe this allowed us to achieve
a relatively high total rate of return as interest rates declined in May and
June and bond prices rose.
Our emphasis has been on bonds with discount coupons, good call protection,
and long maturities. The Fund invests exclusively in bonds that are insured by
one of the major municipal bond insurance companies and are rated AAA by Moody's
and/or Standard & Poor's.
Since 1996, we have substantially reduced our asset allocation to bonds
in the utility industry and increased our weighting in the housing sector. This
reflects our optimism about the growth prospects for the Seattle area in the
coming years, and consequent demand for housing. We have become cautious about
utilities because of possible negative effects of pending industry deregulation
and increased competition. In addition, we believe environmental constraints
designed to protect some species of salmon may affect hydroelectric power plant
output and revenue.

SUMMARY OUTLOOK
We are optimistic that investor demand for municipal bonds could remain stable
in the coming months among high tax brackets investors. Across the U.S. and in
the Northwest, inflation appears to be benign. Despite a strong U.S. economy,
the Federal Reserve Board has been able to use monetary policy to effectively
control consumer price increases. Should interest rates remain stable or decline
for the balance of 1997, municipal bond investments could potentially provide an
attractive real rate of return.
In our opinion, the long-term outlook for the Northwest's economy and
bond market is bright. Major regional employers such as the Boeing Co. and
several high-technology companies are rapidly expanding to meet customer demand,
which should help boost tax revenues.
In our opinion, Washington municipalities will continue to need capital
from private investors to meet the needs of a growing population, presenting
investors with many income opportunities.

ELIZABETH H. HOWELL
VICE PRESIDENT
SENIOR PORTFOLIO MANAGER

July 15, 1997

8
1997 semi-annual report
<PAGE>

Performance Summary

COMPARATIVE TOTAL RETURNS FOR THE SIX MONTHS
ENDED JUNE 30, 1997*
- --------------------------------------------------------------------------------

Tax-Free Idaho Fund A +3.61%
Lehman Brothers Municipal Bond Index +3.20%
Tax-Free Oregon Insured Fund A +2.99%
Tax-Free Washington Insured Fund A +3.44%
Lehman Brothers Insured Municipal Bond Index +3.12%

* TOTAL RETURN IS BASED ON CHANGE IN NET ASSET VALUE WITH DISTRIBUTIONS
REINVESTED. PAST PERFORMANCE DOES NOT GUARANTEE FUTURE RESULTS. PERFORMANCE
OF OTHER FUND CLASSES VARIES DUE TO DIFFERENT CHARGES AND EXPENSES. SEE PAGES
19, 21 AND 23 FOR SIX-MONTH RETURNS FOR B AND C CLASSES. THE UNMANAGED
INDEXES SHOWN ABOVE INCLUDE TAX-EXEMPT BONDS FROM MANY STATES AND ASSUME NO
MANAGEMENT FEES OR OTHER EXPENSES.

TAX-FREE IDAHO FUND
- --------------------------------------------------------------------------------
AVERAGE ANNUAL RETURNS THROUGH JUNE 30, 1997

LIFETIME ONE YEAR
- --------------------------------------------------------------------------------
Class A (Est. 1/4/95)
Excluding Sales Charge +10.10% +9.00%
Including Sales Charge +8.42% +8.42%
- --------------------------------------------------------------------------------
Class B (Est. 3/16/95)
Excluding Sales Charge +7.44% +8.47%
Including Sales Charge +6.24% +4.47%
- --------------------------------------------------------------------------------
Class C (Est. 1/18/95)
Excluding Sales Charge +9.00% +8.10%
Including Sales Charge +9.00% +7.10%

PLEASE TURN TO PAGE 10 FOR IMPORTANT ADDITIONAL INFORMATION. ALL PERFORMANCE
INCLUDES REINVESTMENT OF DISTRIBUTIONS AND APPLICABLE SALES CHARGES AS
DESCRIBED ON PAGE 10. PAST PERFORMANCE IS NOT A GUARANTEE OF FUTURE RESULTS.

9
1997 semi-annual report

<PAGE>

performance

TAX-FREE OREGON INSURED FUND
- --------------------------------------------------------------------------------
AVERAGE ANNUAL RETURNS THROUGH JUNE 30, 1997

LIFETIME ONE YEAR
- --------------------------------------------------------------------------------
Class A (Est. 8/1/93)
Excluding Sales Charge +5.03% +8.51%
Including Sales Charge +4.00% +4.49%
- --------------------------------------------------------------------------------
Class B (Est. 3/12/94)
Excluding Sales Charge +4.86% +6.76%
Including Sales Charge +4.03% +5.88%
- --------------------------------------------------------------------------------
Class C (Est. 7/7/95)
Excluding Sales Charge +5.70% +7.60%
Including Sales Charge +5.70% +6.60%

TAX-FREE WASHINGTON INSURED FUND
- --------------------------------------------------------------------------------
AVERAGE ANNUAL RETURNS THROUGH JUNE 30, 1997

LIFETIME ONE YEAR
- --------------------------------------------------------------------------------
Class A (Est. 8/1/93)
Excluding Sales Charge +6.71% +8.91%
Including Sales Charge +5.67% +4.83%
- --------------------------------------------------------------------------------
Class B (Est. 10/24/94)
Excluding Sales Charge +5.79% +8.17%
Including Sales Charge +3.49% +4.17%
- --------------------------------------------------------------------------------
Class C (Est. 4/21/95)
Excluding Sales Charge +6.50% +8.05%
Including Sales Charge +6.50% +7.05%

ALL PERFORMANCE INCLUDES REINVESTMENT OF DISTRIBUTIONS AND APPLICABLE SALES
CHARGE AS DESCRIBED BELOW. RETURN AND SHARE VALUE WILL FLUCTUATE SO THAT SHARES
WHEN REDEEMED MAY BE WORTH MORE OR LESS THAN THE ORIGINAL COST. PAST PERFORMANCE
IS NOT A GUARANTEE OF FUTURE RESULTS. PERFORMANCE FOR CLASS B AND C SHARES
"EXCLUDING SALES CHARGE" ASSUMES THE INVESTMENT WAS NOT REDEEMED. RETURNS
REFLECT A VOLUNTARY EXPENSE LIMITATION IN EFFECT AT THE TIME. RETURNS WOULD HAVE
BEEN LOWER WITHOUT THE LIMITATION.

CLASS A SHARES HAVE A 3.75% MAXIMUM FRONT-END SALES CHARGE. THE FUNDS ALSO
HAVE A 12B-1 FEE.

CLASS B SHARES DO NOT CARRY A FRONT-END SALES CHARGE, BUT ARE SUBJECT TO A 1%
ANNUAL DISTRIBUTION AND SERVICE FEE. THEY ARE ALSO SUBJECT TO A DEFERRED SALES
CHARGE OF UP TO 4% IF REDEEMED BEFORE THE END OF THE SIXTH YEAR.

CLASS C SHARES HAVE A 1% ANNUAL DISTRIBUTION AND SERVICE FEE. IF SHARES ARE
REDEEMED WITHIN 12 MONTHS, A 1% CONTINGENT DEFERRED SALES CHARGE APPLIES.

10
1997 semi-annual report
<PAGE>

Financial Statements
DELAWARE-VOYAGEUR TAX-FREE IDAHO FUND --
STATEMENT OF NET ASSETS
JUNE 30, 1997
(UNAUDITED)
<TABLE>
<CAPTION>

- ---------------------------------------------------------------------------------------------
PRINCIPAL MARKET
AMOUNT VALUE
-------------------------------------
<S> <C> <C>
MUNICIPAL BONDS - 98.39%
GENERAL OBLIGATION BONDS - 11.98%
Ada and Canyon County School Distritct #2
5.60% 07/30/12 ............................... $1,325,000 $1,373,455
Bonner County Local Improvement District # 93-1
6.20% 04/30/05 ............................... 150,000 152,565
Bonner County Local Improvement District # 93-2
6.35% 4/30/06 ................................ 185,000 187,313
Bonner County Local Improvement District # 93-3
6.40% 04/30/07 ............................... 195,000 197,438
Bonner County Local Improvement District # 93-4
6.50% 04/30/08 ............................... 110,000 111,375
Bonner County Local Improvement District # 93-5
6.50% 04/30/10 ............................... 100,000 101,250
Canyon County Independent School District #131
5.50% 07/30/12 (MBIA) ........................ 100,000 101,229
Coeur D' Alene Local Improvement District # 6
Series 1995 6.00% 07/01/09 .................... 85,000 89,554
Coeur D' Alene Local Improvement District # 6
Series 1996 6.05% 07/01/10 .................... 90,000 94,545
Coeur D' Alene Local Improvement District # 6
Series 1997 6.10% 07/01/12 .................... 40,000 41,897
Coeur D' Alene Local Improvement District # 6
Series 1998 6.10% 07/01/14 .................... 45,000 46,868
Fremont/Madison County Independent School
District (#215) 5.50% 08/01/12 (FSA) .......... 250,000 253,348
Gooding Lincoln Independent School District #231
6.30% 02/01/14 (FSA) ......................... 100,000 107,961
Madison County 5.40% 08/01/14 (FSA) ............ 300,000 304,098
Puerto Rico 5.38% 07/01/25 .................... 1,250,000 1,203,638
Sun Valley 5.20% 08/01/09 .................... 180,000 182,329
----------
4,548,863
----------
HIGHER EDUCATION REVENUE BONDS - 5.08%
Idaho State University (MBIA)
5.80% 04/01/20 ............................... 550,000 561,016
University Of Idaho Revenue (FSA)
5.85% 04/01/11 ............................... 1,300,000 1,366,885
----------
1,927,901
----------
HOSPITAL REVENUE BONDS - 15.46%
Idaho Health Facilities Authority Revenue-Bonner
General Hospital 6.50% 10/01/28 ............... 1,500,000 1,499,805
Idaho Health Facilities Revenue Bannock
Medical Center 6.38% 05/01/17 ................. 1,695,000 1,751,714
Idaho Health Facilities Revenue Bannock
Medical Center 6.13% 05/01/25 ................. 1,500,000 1,502,775
Idaho Magic Valley Health Facilities
5.63% 12/01/13 (AMBAC) ........................ 500,000 504,135
Idaho St. Alphonsus Health Facility
6.25% 12/01/22 ............................... 590,000 612,237
----------
5,870,666
----------
</TABLE>

<PAGE>

- ---------------------------------------------------------------------------------------------
PRINCIPAL MARKET
AMOUNT VALUE
-------------------------------------
<S> <C> <C>
MUNICIPAL BONDS (CONTINUED)
HOUSING REVENUE BONDS - 12.07%
Idaho State Housing Agency Multi-Family
PL. Plaza 6.50% 12/01/36 (FHA) ................. $1,000,000 $1,037,630
Idaho State Housing Finance Authority Single
Family Series E 6.35% 07/01/15 (FHA) ........... 350,000 364,175
Idaho State Housing Finance Authority Single
Family Series A1 6.85% 07/01/12 ................ 90,000 95,391
Idaho State Housing Finance Authority Single
Family Housing Series G-2 6.15% 07/01/15 ....... 1,500,000 1,538,235
Idaho State Housing Finance Authority Single
Family Series A 6.10% 07/01/16 (FHA) ........... 370,000 378,339
Idaho State Housing Finance Authority Single
Family Series A 6.05% 07/01/13 (AMBAC) ......... 500,000 510,115
Idaho State Housing Finance Authority Single
Family Series E 6.60% 07/01/11 ................. 175,000 185,886
Idaho State Housing Finance Authority Single
Family Series B 6.45% 07/01/15 (FHA) ........... 200,000 208,498
Idaho State Housing Finance Authority Single
Family Series C-2 6.35% 07/01/15 ............... 255,000 261,943
----------
4,580,212
----------
INDUSTRIAL DEVELOPMENT
REVENUE BONDS - 8.70%
Idaho State Water Resource Boise Water
7.25% 12/01/21 ................................ 100,000 107,079
Meridan EDA for Hi-Micro 5.85% 08/15/11 ......... 1,250,000 1,266,638
Pocatello Development Authority and Tax
Increment Revenue 7.25% 12/01/08 ............... 1,700,000 1,767,745
Puerto Rico Industrial Medical Environmental
Revenue-Pepsico Project 6.25% 1/15/13 .......... 150,000 160,772
----------
3,302,234
----------
LEASE/CERTIFICATES OF PARTICIPATION - 2.66%
North Idaho College Dorm Housing-Certificates
of Participation 6.45% 10/01/16 ................ 1,000,000 1,011,070
----------
1,011,070
----------
POLLUTION CONTROL REVENUE BONDS - 14.74%
Nez Perce County, Idaho Pollution Control Revenue
Refunding-Potlatch Project 6.00% 10/01/24 ...... 5,500,000 5,593,885
----------
5,593,885
----------
POWER AUTHORITY REVENUE BONDS - 3.51%
Puerto Rico Electric Power Authority Series X
5.50% 07/01/25 ................................ 1,375,000 1,331,151
----------
1,331,151
----------
UTILITY REVENUE BONDS - 0.66%
Puerto Rico Electric Power Authority
6.00% 07/01/16 (FSA) .......................... 100,000 104,085
Puerto Rico Telephone Revenue Authority
5.50% 01/01/22 ................................ 150,000 146,451
----------
250,536
----------
</TABLE>

11
1997 semi-annual report

<PAGE>
DELAWARE-VOYAGEUR TAX-FREE IDAHO FUND --
STATEMENT OF NET ASSETS (CONTINUED)
<TABLE>
<CAPTION>

- ---------------------------------------------------------------------------------------------
PRINCIPAL MARKET
AMOUNT VALUE
-------------------------------------
<S> <C> <C>

MUNICIPAL BONDS (CONTINUED)
TRANSPORTATION REVENUE BONDS - 0.88%
Guam Highway 6.30% 05/01/12 (FSA) ........... $ 150,000 $ 159,890
Puerto Rico Highway Revenue Series W
5.50% 07/01/15 ............................ 175,000 174,603
----------
334,493
----------
WATER AND SEWER REVENUE BONDS - 3.83%
Chubbuck Water Revenue 6.35% 04/01/08 ....... 125,000 129,699
Chubbuck Water Revenue 6.40% 04/01/10 ....... 135,000 139,640
McCall Water Revenue
5.85% 03/01/16 (FSA) ...................... 1,000,000 1,034,200
Owyhee Sewer District 95-1
5.50% 05/15/04 ............................ 150,000 150,734
----------
1,454,273
----------
OTHER REVENUE BONDS - 18.82%
Ammon, Idaho Urban Renewal Agency Revenue
6.25% 08/01/18 ............................ 445,000 453,918
Ammon Urban Renewal Tax Inc Revenue
5.88% 08/01/17 ............................ 350,000 357,256
Boise Urban Renewal Agency Tax Inc Revenue
6.13% 09/01/15 ............................ 2,500,000 2,506,750
Boise Urban Renewal Tax Inc Bd-B
6.13% 09/01/15 ............................ 2,040,000 2,045,508
City of Hayden LID #1995-2
5.80% 11/01/06 ............................ 160,000 159,998
Hayden, Idaho Improvement District
95-1-Special Assessment 6.35% 05/01/13 ..... 120,000 119,988
Hayden, Idaho Improvement District
95-Special Assessment 6.30% 05/01/12 ....... 115,000 114,989
Hayden, Idaho Improvement District
95-Special Assessment 6.40% 05/01/14 ....... 125,000 124,988
Hayden, Idaho Improvement District
95-Special Assessment 6.50% 05/01/15 ....... 125,000 124,986
Puerto Rico Public Building Authority Revenue
Series M 5.50% 07/01/21 ................... 1,175,000 1,137,012
----------
7,145,393
----------
Total Municipal Bonds (Cost $36,343,464 ) ... 37,350,677
----------
</TABLE>

<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C>
TOTAL MARKET VALUE OF SECURITIES OWNED - 98.39%
(cost $36,343,464)* ............................ $37,350,677
RECEIVABLES AND OTHER ASSETS NET OF
LIABILITIES - 1.61% ............................ 609,744
----------
NET ASSESTS APPLICABLE TO 3,447,300 SHARES
($.01 PAR VALUE) OUTSTANDING - 100% ............. $37,960,421
===========
NET ASSET VALUE - TAX-FREE IDAHO FUND A CLASS
($30,898,670 / 2,805,435 shares) ............... $ 11.01
===========
NET ASSET VALUE - TAX-FREE IDAHO FUND B CLASS
($6,219,242 / 565,269 shares) ................... $ 11.00
===========
NET ASSET VALUE - TAX-FREE IDAHO FUND C CLASS
($842,509 / 76,596 shares) ..................... $ 11.00
===========
- ----------
*Also cost for federal tax purposes.

AMBAC - Insured by the AMBAC Indemnity Corporation
FHA - Insured by the Federal Housing Authority
FSA - Insured by the Financial Security Assurance
MBIA - Insured by the Municipal Bond Insurance Association
- ----------
COMPONENTS OF NET ASSETS AT JUNE 30, 1997 ,
Common Stock $.01 par value, 100,000,000,000 shares authorized
to the Fund with 10,000,000,000 shares allocated to Tax-Free
Idaho Fund A Class 10,000,000,000 shares allocated to
Tax-Free Idaho Fund B Class 10,000,000,000 shares
allocated to Tax-Free Idaho Fund C Class. ................... $36,983,971
Accumulated overdistributed net investment income (10,294)
Accumulated net realized loss on investments ................. (20,469)
Net unrealized appreciation of investments ................... 1,007,213
-----------
Total net assets.............................................. $37,960,421
===========

</TABLE>
12
1997 semi-annual report

<PAGE>
DELAWARE-VOYAGEUR TAX-FREE OREGON INSURED FUND --
STATEMENT OF NET ASSETS
JUNE 30, 1997
(UNAUDITED)
<TABLE>
<CAPTION>

- ---------------------------------------------------------------------------------------------
PRINCIPAL MARKET
AMOUNT VALUE
-------------------------------------
<S> <C> <C>

MUNICIPAL BONDS - 95.26%
GENERAL OBLIGATION BONDS - 32.91%
Chemeketa Community College
5.80% 06/01/12 (FGIC) ......................... $1,500,000 $1,551,555
Hermiston G.O. Water Bonds
6.20% 08/01/24 (AMBAC) ........................ 500,000 527,145
Lane County School District #19
6.30% 10/15/14 (MBIA) ......................... 500,000 539,855
Lincoln County School District
5.25% 06/15/12 (FGIC) ......................... 1,450,000 1,456,337
Malheur County Jail
6.30% 12/01/12 (MBIA) ......................... 500,000 542,370
Multnomah County School District #3 Park Rose
5.50% 12/01/11 (FGIC) ......................... 500,000 510,210
Multnomah County School District #39 Corbett
6.00% 12/01/13 (MBIA) ......................... 500,000 525,250
North Unit Irrigation District
5.75% 06/01/16 (MBIA) ......................... 1,000,000 1,020,890
Portland 5.75% 06/01/15 (MBIA)500,000 ........... 509,825
Silverton Fire Protection District #2
5.63% 12/01/15 (FGIC) ......................... 550,000 555,654
Tillamook County 6.25% 01/01/14 (FGIC) .......... 250,000 269,110
Umatilla Pendleton School District #016R
6.00% 07/01/14 (AMBAC) ........................ 500,000 526,390
Washington County Sherwood School District #88J
6.10% 06/01/12 (FSA) .......................... 300,000 320,115
---------
8,854,706
---------
HIGHER EDUCATION REVENUE BONDS - 10.66%
Central Oregon Community College
5.90% 6/01/09 (FGIC) .......................... 750,000 787,650
Oregon Health and Education Authority for Lewis &
Clark College 6.13% 10/01/24 (MBIA) ............ 1,055,000 1,106,853
Oregon Health and Education Authority for
Reed College 5.38% 07/01/25 (MBIA) ............. 1,000,000 975,270
---------
2,869,773
---------
</TABLE>

<PAGE>

- ---------------------------------------------------------------------------------------------
PRINCIPAL MARKET
AMOUNT VALUE
-------------------------------------
<S> <C> <C>

MUNICIPAL BONDS (CONTINUED)
HOSPITAL REVENUE BONDS - 7.63%
Western Lane Hospital District
5.75% 08/01/19 (MBIA) ....................... $1,000,000 $1,014,060
Western Lane Hospital District
5.88% 08/01/12 (MBIA) ....................... 1,000,000 1,038,770
---------
2,052,830
---------
HOUSING REVENUE BONDS - 4.16%
Oregon Health and Education Authority for Pier
Park Project 6.05% 04/01/18 (GNMA) ........... 1,095,000 1,119,473
---------
1,119,473
---------
LEASE/CERTIFICATES OF PARTICIPATION - 3.76%
Oregon State Department Administrative Services
Certificate Participation-Series A
5.80% 05/01/24 .............................. 1,000,000 1,012,740
---------
1,012,740
---------
POWER AUTHORITY REVENUE BONDS - 6.62%
Central Lincoln Peoples Utility District
5.75% 01/01/15 (AMBAC) ...................... 500,000 508,510
Eugene Electric Revenue Series C
5.80% 08/01/22 (MBIA) ....................... 1,250,000 1,272,875
---------
1,781,385
---------
*PRE-REFUNDED BONDS- 3.01%
Washington County Education Service
7.10% 06/01/25-05 (MBIA) .................... 700,000 809,389
---------
809,389
---------
TRANSPORTATION REVENUE BONDS - 7.35%
Portland International Airport
5.63% 7/01/26 (FGIC) ........................ 2,000,000 1,978,820
---------
1,978,820
---------
</TABLE>

13
1997 semi-annual report

<PAGE>

DELAWARE-VOYAGEUR TAX-FREE OREGON INSURED FUND --
STATEMENT OF NET ASSETS (CONTINUED)
<TABLE>
<CAPTION>

- ---------------------------------------------------------------------------------------------
PRINCIPAL MARKET
AMOUNT VALUE
-------------------------------------
<S> <C> <C>

WATER AND SEWER REVENUE BONDS - 15.42%
Beaverton Water Revenue
6.13% 06/01/14 (FSA) ........................... $ 500,000 $ 530,040
Klamath Falls Water Revenue
6.10% 06/01/14 (FSA) ........................... 500,000 529,920
Portland Sewer System Revenue
6.25% 06/01/15 (FSA) ........................... 1,000,000 1,065,460
Salem Water & Sewer Revenue
5.50% 06/01/14 (MBIA) .......................... 1,000,000 1,010,460
Salem Water & Sewer Revenue
5.63% 06/01/16 (MBIA) .......................... 1,000,000 1,012,160
----------
4,148,040
----------
OTHER REVENUE BONDS - 3.74%
Northern Wasco County
5.63% 12/01/22 (FGIC) ........................... 1,000,000 1,006,840
----------
1,006,840
----------
Total Municipal Bonds (cost $24,492,752) ......... 25,633,996
----------

SHORT TERM INVESTMENTS - 3.57%
Norwest Advantage Municipal Money
Market Fund ..................................... 958,941 958,941
Total Short Term Investments ----------
(cost $958,941) ................................ 958,941
----------

TOTAL MARKET VALUE OF SECURITIES OWNED - 98.83%
(cost $25,451,693)** ........................... $26,592,937
RECEIVABLES AND OTHER ASSETS NET OF
LIABILITIES - 1.17% ............................ 315,791
----------
NET ASSESTS APPLICABLE TO 2,715,625 SHARES
($.01 PAR VALUE) OUTSTANDING - 100.00% .......... $26,908,728
===========

NET ASSET VALUE - TAX FREE OREGON INSURED A CLASS
($21,324,137 / 2,152,169 shares). . ...................................... $9.91
=====
NET ASSET VALUE - TAX FREE OREGON INSURED B CLASS
($5,125,183 / 517,121 shares). . . . . ................................... $9.91
=====
NET ASSET VALUE - TAX FREE OREGON INSURED C CLASS
($459,408 / 46,335 shares). . . . . . . . ................................ $9.92
=====

- --------------
* For Pre-Refunded Bonds, the stated maturity is followed by the year in which
each bond is pre-refunded.
**Also cost for federal tax purposes.
AMBAC - Insured by the AMBAC Indemnity Corporation
FGIC - Insured by the Financial Guaranty Insurance Company
FSA - Insured by the Financial Security Assurance
GNMA - Insured by the Government National Mortgage Association
MBIA - Insured by the Municipal Bond Insurance Association

- --------------
COMPONENTS OF NET ASSETS AT JUNE 30, 1997
Common Stock, $.01 par value, unlimited shares authorized to the
Tax-Free Oregon Insured Fund.............................................. $26,411,655
Accumulated overdistributed net investment income.......................... (22,111)
Accumulated net realized loss on investments............................... (622,060)
Net unrealized appreciation of investments................................. 1,141,244
-----------
Total net assets........................................................... $26,908,728
===========

</TABLE>
14

1997 semi-annual report

<PAGE>

DELAWARE-VOYAGEUR TAX-FREE WASHINGTON INSURED FUND
STATEMENT OF NET ASSETS
JUNE 30, 1997
(UNAUDITED)
- --------------------------------------------------------------------------------

<TABLE>
<CAPTION>
PRINCIPAL MARKET
AMOUNT VALUE
-------------------------------------
<S> <C> <C>
MUNICIPAL BONDS - 93.84%
GENERAL OBLIGATION BONDS - 19.96%
Benton County Independent School District #116
5.80% 12/01/10 (FGIC) .......................... $100,000 $103,902
Bothell 5.70% 12/01/10 (AMBAC) ................... 75,000 77,628
Clark County School District #114
6.00% 12/01/11 (FGIC) .......................... 75,000 79,566
Kent Washington Series A
6.00% 12/01/16 (MBIA) .......................... 100,000 104,449
King County Kent School District #415
5.55% 12/01/11 (MBIA) .......................... 75,000 77,251
Snohomish County 5.90% 12/01/15 (MBIA) ........... 75,000 76,985
Washington State Series 93A UTGO Utility
General Obligation 5.75% 10/01/17 (FGIC) ........ 100,000 101,706
---------
621,487
---------
HIGHER EDUCATION REVENUE BONDS - 13.26%
Washington Higher Education Pacific Lutheran
5.70% 11/01/26 (Connie Lee) ..................... 200,000 200,146
Washington State Housing & Dining System
6.38% 10/01/18 (MBIA) .......................... 200,000 212,530
---------
412,676
---------
HOSPITAL REVENUE BONDS - 13.06%
University Of Washington Medical Center
6.30% 08/15/14 (FSA) ........................... 200,000 212,904
Washington Health Care Facility
5.25% 12/01/20 (Connie Lee) ..................... 100,000 93,483
Washington State Health Care Peace Health
5.63% 11/15/15 (MBIA) .......................... 100,000 100,343
---------
406,730
---------
HOUSING REVENUE BONDS - 27.05%
King County, Washington Housing Authority-
Fred Lind Manor Project-A 6.67% 06/20/32 ........ 200,000 211,590
Kitsap County Housing
7.10% 02/20/36 (GNMA) .......................... 200,000 219,828
State Housing Single Family Mortise
6.20% 12/01/22 (GNMA) .......................... 200,000 204,418
Washington State Housing Finance AMT-Single Family
PG-Series 2A 6.30% 12/01/27 ..................... 200,000 206,070
---------
841,906
---------
INDUSTRIAL DEVELOPEMENT
REVENUE BONDS - 2.53%
University Of Washington Parking Revenue
6.13% 11/01/14 (AMBAC) ......................... 75,000 78,768
---------
78,768
---------
POWER AUTHORITY REVENUE BONDS - 9.72%
Grant County Public #2 Wanapum
5.88% 01/01/26 (MBIA) .......................... 100,000 100,271
Kittitas County Public #1
5.80% 12/01/20 (MBIA) .......................... 100,000 101,223

</TABLE>

<PAGE>

<TABLE>
<CAPTION>
PRINCIPAL MARKET
AMOUNT VALUE
-------------------------------------
<S> <C> <C>
MUNICIPAL BONDS (CONTINUED)
POWER AUTHORITY REVENUE BONDS (CONTINUED)
Washington State Public Power #1
5.75% 07/01/12 (MBIA) ............................. $ 100,000 $ 101,055
----------
302,549
----------
WATER AND SEWER REVENUE BONDS - 8.26%
Covington Water & Sewer Revenue
6.00% 03/01/15 (AMBAC) ............................ 75,000 77,644
Seattle Metropolitan Sewer Revenue
5.70% 01/01/14 (FGIC) ............................. 75,000 76,094
Vancouver Water And Sewer Revenue
6.00% 06/01/16 (FGIC) ............................. 100,000 103,296
----------
257,034
----------
Total Municipal Bonds (cost $2,808,190) ............. 2,921,150
----------
SHORT TERM INVESTMENTS - 5.18%
Norwest Advantage Municipal Money
Market Fund ........................................ 161,156 161,156
----------
Total Short Term Investments
(cost $161,156) ................................... 161,156
----------

TOTAL MARKET VALUE OF SECURITIES OWNED - 99.02%
(cost $2,969,346)* ........................................................ $3,082,306
RECEIVABLES AND OTHER ASSETS NET OF
LIABILITIES - .98% ....................................................... 30,610
----------
NET ASSESTS APPLICABLE TO 300,086 SHARES
($.01 PAR VALUE) OUTSTANDING - 100% ....................................... $3,112,916
==========

NET ASSET VALUE - TAX FREE WASHINGTON INSURED A CLASS
($2,335,074 / 225,156 shares) ............................................ $10.37
======
NET ASSET VALUE - TAX FREE WASHINGTON INSURED B CLASS
($722,178 / 69,562 shares) ............................................... $10.38
======
NET ASSET VALUE - TAX FREE WASHINGTON INSURED C CLASS
($55,664 / 5,368 shares) ................................................. $10.37
======
- ----------
*Also cost for federal tax purposes.
AMBAC - Insured by the AMBAC Indemnity Corporation
Connie Lee - Insured by the College Construction Insurance Association
FGIC -Insured by the Financial Guaranty Insurance Company
FSA - Insured by the Financial Security Assurance
GNMA - Insured by the Government National Mortgage Association
MBIA - Insured by the Municipal Bond Insurance Association

- ----------
COMPONENTS OF NET ASSETS AT JUNE 30, 1997
Common Stock, $.01 par value, unlimited shares authorized to the
Tax-Free Washington Insured Fund........................................... $3,081,922
Accumulated overdistributed net investment income .......................... (535)
Accumulated net realized loss on investments ............................... (81,431)
Net unrealized appreciation of investments ................................. 112,960
----------
Total net assets............................................................ $3,112,916
==========
</TABLE>

1997 semi-annual report
<PAGE>

THE DELAWARE-VOYAGEUR FUNDS --
STATEMENT OF OPERATIONS
SIX MONTHS ENDING JUNE 30, 1997
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
TAX-FREE TAX-FREE
TAX-FREE OREGON WASHINGTON
IDAHO FUND INSURED FUND INSURED FUND
INVESTMENT INCOME: ------------------------------------------------------
<S> <C> <C> <C>
Interest ................................................................. $ 1,056,549 $ 733,506 $ 86,183
----------- ----------- -----------
1,056,549 733,506 86,183
----------- ----------- -----------
EXPENSES:
Management fees .......................................................... 89,160 64,954 7,428
Dividend disbursing, transfer agent and custodian fees and expenses ...... 32,822 22,426 7,752
Distribution expense ..................................................... 68,894 52,023 5,945
Registration fees ........................................................ 5,836 498 498
Reports and statements to shareholders ................................... 5,447 2,623 2,567
Accounting fees and salaries ............................................. 3,473 2,688 301
Professional fees ........................................................ 4,227 2,385 2,351
Directors' fees .......................................................... 778 443 127
Amortization of organization expenses .................................... 917 -- --
Other .................................................................... 835 2,740 200
----------- ----------- -----------
212,389 150,780 27,169
Less expenses waived or absorbed ......................................... (39,960) (41,486) (17,669)
----------- ----------- -----------
Total net expenses ....................................................... 172,429 109,294 9,500
----------- ----------- -----------

NET INVESTMENT INCOME .................................................... 884,120 624,212 76,683
----------- ----------- -----------

NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain (loss) on investments ................................ 20,013 (4,323) (653)
Net change in unrealized appreciation of investments ................... 398,911 121,665 21,386
----------- ----------- -----------

NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS .......................... 418,924 117,342 20,733
----------- ----------- -----------

NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS ..................... $ 1,303,044 $ 741,554 $ 97,416
=========== =========== ===========
</TABLE>

See accompanying notes

1997 semi-annual report
<PAGE>

THE DELAWARE-VOYAGEUR FUNDS --
STATEMENT OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>

TAX-FREE OREGON TAX-FREE WASHINGTON
TAX-FREE IDAHO FUND INSURED FUND INSURED FUND
------------------------- --------------------- --------------------------
SIX MONTHS YEAR SIX MONTHS YEAR SIX MONTHS YEAR
ENDED ENDED ENDED ENDED ENDED ENDED
6/30/97 12/31/96 6/30/97 12/31/96 6/30/97 12/31/96
(UNAUDITED) (UNAUDITED) (UNAUDITED)
<S> <C> <C> <C> <C> <C> <C>
INCREASE IN NET ASSETS FROM OPERATIONS:
Net investment income ...................... $ 884,120 $ 1,366,067 $ 624,212 $ 1,206,292 $ 76,683 $ 131,570
Net realized gain (loss) on investments .... 20,013 (40,482) (4,323) (196,640) (653) (2,791)
Net change in unrealized
appreciation/(depreciation) ............... 398,911 66,395 121,665 (232,512) 21,386 (13,997)
--------- ---------- --------- --------- ------- ---------
Net increase in net assets resulting
from operations............................ 1,303,044 1,391,980 741,554 777,140 97,416 114,782
--------- ---------- --------- --------- ------- ---------

DISTRIBUTION TO SHAREHOLDERS FROM:
Net investment income:
A Class.................................... (775,738) (1,118,768) (534,875) (1,030,533) (65,320) (117,335)
B Class.................................... (133,559) (176,734) (107,798) (161,757) (13,079) (11,708)
C Class.................................... (19,945) (37,976) (7,727) (9,989) (599) (812)
--------- ---------- --------- --------- ------- ---------
(929,242) (1,333,478) (650,400) (1,202,279) (78,998) (129,855)
--------- ---------- --------- --------- ------- ---------
CAPITAL SHARE TRANSACTIONS:
Proceeds from shares sold:
A Class ................................... 4,502,176 14,993,646 1,887,081 4,388,724 195,971 512,363
B Class ................................... 1,227,449 3,034,644 529,437 2,486,473 289,932 512,470
C Class ................................... 453,543 369,077 108,431 278,889 35,648 947
Net asset value of shares issued upon
reinvestment of dividends from net
investment income:
A Class.................................... 459,360 593,826 340,702 591,621 34,530 54,645
B Class.................................... 67,630 63,171 72,575 87,855 7,837 5,371
C Class.................................... 18,030 42,079 4,690 6,822 120 0
--------- ---------- --------- --------- ------- ---------
6,728,188 19,096,443 2,942,916 7,840,384 564,038 1,085,796
--------- ---------- --------- --------- ------- ---------
Cost of shares repurchased:
A Class ................................... (2,047,958) (1,473,902) (1,889,860) (5,261,339) (291,262) (260,676)
B Class ................................... (84,131) (162,225) (251,621) (575,002) (95,694) (26,026)
C Class ................................... (460,692) (374,650) (15,000) (173,467) 0 0
--------- ---------- --------- --------- ------- ---------
(2,592,781) (2,010,777) (2,156,481) (6,009,808) (386,956) (286,702)
--------- ---------- --------- --------- ------- ---------
Increase in net assets derived from capital
share transactions ........................ 4,135,407 17,085,666 786,435 1,830,576 177,082 799,094
--------- ---------- --------- --------- ------- ---------

NET INCREASE IN NET ASSETS ................. 4,509,209 17,144,168 877,589 1,405,437 195,500 784,021

NET ASSETS:
Beginning of period ........................ 33,451,212 16,307,044 26,031,139 24,625,702 2,917,416 2,133,395
----------- ----------- ----------- ----------- ----------- ----------
End of period .............................. $37,960,421 $33,451,212 $26,908,728 $26,031,139 $ 3,112,916 $2,917,416
=========== =========== =========== =========== =========== ==========
</TABLE>

See accompanying notes

1997 semi-annual report
<PAGE>

THE DELAWARE-VOYAGEUR FUNDS --
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------

Selected data for each share of the Fund outstanding throughout each period was
as follows:
<TABLE>
<CAPTION>
TAX-FREE IDAHO FUND - A CLASS
----------------------------------------------
SIX MONTHS YEAR PERIOD FROM
ENDED ENDED 1/4/95(1)
6/30/97 12/31/96 TO 12/31/95
(UNAUDITED)
<S> <C> <C> <C>
Net asset value, beginning of period ................ $10.91 $11.02 $10.00

Income from investment operations:
Net investment income .............................. 0.27 0.58 0.60
Net realized and unrealized gain (loss)
from investments................................... 0.11 (0.12) 1.10
------ ------ ------
Net increase in net assets from
investment operations.............................. 0.38 0.46 1.70
------ ------ ------

Less dividends and distributions:
Dividends from net investment income(2)............. (0.28) (0.57) (0.60)
Distributions from net realized gain on
security transactions ............................. -- -- (0.08)
------ ------ ------
Total dividends and distributions ................... (0.28) (0.57) (0.68)
------ ------ ------

Net asset value, end of period ...................... $11.01 $10.91 $11.02
====== ====== ======

Total Return(3)...................................... 3.61% 4.36% 17.48%

Ratios and supplemental data:
Net assets, end of period (000 omitted) ............ $30,899 $27,684 $13,540
Ratio of expenses to average net assets(4).......... 0.87%(5) 0.60% 0.26%(5)
Ratio of expenses to average net assets
prior to expense limitation........................ 1.05%(5) 1.10% 1.25%(5)
Ratio of net investment income to
average net assets ................................ 5.05%(5) 5.29% 5.24%(5)
Ratio of net investment income to average
net assets prior to expense limitation ............ 4.87%(5) 4.79% 4.25%(5)
Portfolio turnover ................................. 14.17%(5) 34.68% 41.97%

</TABLE>
- ----------
(1) Commencement of operations.
(2) 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 period ended December 31, 1995, $.01 per share of
distribution from net investment income w as subject to state income tax.
(3) 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.
(4) For the years ended December 31, 1995 and 1996, the expense ratio reflects
the effect of gross expenses attributable to earnings credits on uninvested
cash balances received by the Fund. Prior period expense ratios have not
been adjusted.
(5) Annualized.

1997 semi-annual report

<PAGE>

FINANCIAL HIGHLIGHTS (CONTINUED)
- --------------------------------------------------------------------------------
Selected data for each share of the Fund outstanding throughout each period was
as follows:
<TABLE>
<CAPTION>

TAX-FREE IDAHO FUND - B CLASS TAX-FREE IDAHO FUND - C CLASS
-------------------------------------- ----------------------------------------
SIX MONTHS YEAR PERIOD FROM SIX MONTHS YEAR PERIOD FROM
ENDED ENDED 3/16/95(1) ENDED ENDED 1/11/95(1)
6/30/97 12/31/96 TO 12/31/95 6/30/97 12/31/96 TO 12/31/95
(UNAUDITED) (UNAUDITED)
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period .... $10.89 $11.01 $10.50 $10.90 $11.02 $10.04

Income from investment operations:
Net investment income .................. 0.24 0.52 0.42 0.21 0.50 0.50
Net realized and unrealized gain
(loss) from investments ............... 0.12 (0.13) 0.59 0.12 (0.13) 1.06
------ ------ ------ ------ ------ ------
Net increase in net assets from
investment operations ................. 0.36 0.39 1.01 0.33 0.37 1.56
------ ------ ------ ------ ------ ------

Less dividends and distributions:
Dividends from net
investment income(2)................... (0.25) (0.51) (0.42) (0.23) (0.49) (0.50)
Distributions from net realized gain
on security transactions............... -- -- (0.08) -- -- (0.08)
------ ------ ------ ------ ------ ------
Total dividends and distributions ....... (0.25) (0.51) (0.50) (0.23) (0.49) (0.58)
------ ------ ------ ------ ------ ------

Net asset value, end of period .......... $11.00 $10.89 $11.01 $11.00 $10.90 $11.02
====== ====== ====== ====== ====== ======

Total Return(3) ........................ 3.44% 3.75% 9.86% 3.21% 3.48% 15.81%

Ratios and supplemental data:
Net assets, end of
period (000 omitted) .................. $6,219 $4,945 $1,977 $843 $822 $789
Ratio of expenses to average
net assets(4).......................... 1.37%(5) 1.11% 0.79%(5) 1.62%(5) 1.33% 1.05%(5)
Ratio of expenses to average net assets
prior to expense limitation ........... 1.80%(5) 1.85% 1.90%(5) 1.80%(5) 1.82% 2.00%(5)
Ratio of net investment income to
average net assets .................... 4.55%(5) 4.78% 4.68%(5) 4.30%(5) 4.57% 4.48%(5)
Ratio of net investment income to average
net assets prior to expense limitation. 4.12%(5) 4.04% 3.57%(5) 4.12%(5) 4.08% 3.53%(5)
Portfolio turnover ..................... 14.17%(5) 34.68% 41.97% 14.17%(5) 34.68% 41.97%
</TABLE>
- ----------
(1) Commencement of operations
(2) 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 period ended December 31, 1995, $.01 per share of
distribution from net investment income w as subject to state income tax.
(3) 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.
(4) For the years ended December 31, 1995 and 1996, the expense ratio reflects
the effect of gross expenses attributable to earnings credits on uninvested
cash balances received by the Fund. Prior period expense ratios have not
been adjusted.
(5) Annualized.

1997 semi-annual report

<PAGE>

FINANCIAL HIGHLIGHTS (CONTINUED)
- --------------------------------------------------------------------------------

Selected data for each share of the Fund outstanding throughout each period was
as follows:
<TABLE>
<CAPTION>

TAX-FREE OREGON FUND - A CLASS
---------------------------------------------------------------------------------
SIX MONTHS YEAR YEAR TWO MONTHS YEAR PERIOD FROM
ENDED ENDED ENDED ENDED ENDED 8/1/93(1)
6/30/97 12/31/96 12/31/95 12/31/94 10/31/94 TO 10/31/93
(UNAUDITED)
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period $9.87 $10.05 $8.92 $9.00 $10.24 $10.00

Income from investment operations:
Net investment income ............... 0.23 0.48 0.49 0.09 0.50 0.13
Net realized and unrealized gain
(loss) from investments............. 0.05 (0.18) 1.14 (0.09) (1.24) 0.24
----- ------ ------- -------- ------- -------
Net increase (decrease) in net assets
from investment operations ......... 0.28 0.30 1.63 -- (0.74) 0.37
----- ------ ------- -------- ------- -------

Less dividends and distributions:
Dividends from net
investment income(2) .............. (0.24) (0.48) (0.50) (0.08) (0.50) (0.13)
Distributions from net realized
gain on security transactions...... -- -- -- -- -- --
----- ------ ------ ------- ------ ------
Total dividends and distributions .. (0.24) (0.48) (0.50) (0.08) (0.50) (0.13)
----- ------ ------- ------- ------ ------

Net asset value, end of period ...... $9.91 $9.87 $10.05 $8.92 $9.00 $10.24
===== ====== ====== ======= ====== ======

Total Return(3)...................... 2.99% 3.15% 18.71% 0.06% (7.35%) 3.64%

Ratios and supplemental data:
Net assets, end of period
(000 omitted)...................... $21,324 $20,913 $21,590 $14,650 $14,086 $4,609
Ratio of expenses to average
net assets(4) ..................... 0.71%(5) 0.71% 0.54% 0.05%(5) 0.03% 0.00%
Ratio of expenses to average net
assets prior to expense limitation. 1.01%(5) 1.07% 1.11% 1.25%(5) 1.25% 1.25%(5)
Ratio of net investment income to
average net assets ................ 4.93%(5) 4.92% 5.12% 5.79%(5) 5.17% 4.61%(5)
Ratio of net investment income to
average net assets prior to
expense limitation ................ 4.63%(5) 4.56% 4.55% 4.59%(5) 3.95% 3.36%(5)
Portfolio turnover ................. 5.88%(5) 39.54% 41.08% 0.00% 48.98% 11.08%

</TABLE>
- ----------
(1) Commencement of operations
(2) For federal income tax purposes, all of the net investment income
distributions were derived from interest on securities exempt from federal
income tax. For Class A Shares for the year ended October 31, 1994, $.01
per share of distribution from net investment income was subject to state
income tax.
(3) 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.
(4) For the years ended December 31, 1995 and 1996, the expense ratio reflects
the effect of gross expenses attributable to earnings credits on uninvested
cash balances received by the Fund. Prior period expense ratios have not
been adjusted.
(5) Annualized.

20
1997 semi-annual report

<PAGE>

FINANCIAL HIGHLIGHTS (CONTINUED)
- --------------------------------------------------------------------------------

Selected data for each share of the Fund outstanding throughout each period was
as follows:
<TABLE>
<CAPTION>

TAX-FREE OREGON FUND - B CLASS TAX-FREE OREGON FUND - C CLASS
-------------------------------------------------------- ---------------------------------------

SIX MONTHS YEAR YEAR TWO MONTHS PERIOD FROM SIX MONTHS YEAR PERIOD FROM
ENDED ENDED ENDED ENDED 3/12/94(1) ENDED ENDED 7/7/95(1)
6/30/97 12/31/96 12/31/95 12/31/94 TO 10/31/94 6/30/97 12/31/96 TO 12/31/95
(UNAUDITED) (UNAUDITED)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning of period ............ $9.87 $10.05 $8.92 $9.00 $9.85 $9.88 $10.05 $9.63

Income from investment
operations:
Net investment income .......... 0.20 0.43 0.44 0.08 0.27 0.19 0.40 0.19
Net realized and unrealized gain
(loss) from investments ....... 0.05 (0.18) 1.14 (0.09) (0.85) 0.05 (0.17) 0.41
------ ------ ------ ------ ------ ------ ------ ------
Net increase (decrease) in
net assets from investment
operations .................... 0.25 0.25 1.58 (0.01) (0.58) 0.24 0.23 0.60
------ ------ ------ ------ ------ ------ ------ ------

Less dividends and distributions:
Dividends from net
investment income(2)........... (0.21) (0.43) (0.45) (0.07) (0.27) (0.20) (0.40) (0.18)
------ ------ ------ ------ ------ ------ ------ ------
Total dividends
and distributions ............. (0.21) (0.43) (0.45) (0.07) (0.27) (0.20) (0.40) (0.18)
------ ------ ------ ------ ------ ------ ------ ------

Net asset value, end
of period ...................... $9.91 $9.87 $10.05 $8.92 $9.00 $9.92 $9.88 $10.05
====== ====== ====== ====== ====== ====== ====== ======

Total Return(3).................. 2.65% 2.61% 18.10% 0.03% (5.95%) 2.54% 2.38% 6.35%

Ratios and supplemental data:
Net assets, end of period
(000 omitted) ................. $5,125 $4,758 $2,786 $1,303 $1,146 $459 $360 $250
Ratio of expenses to average
net assets(4).................. 1.35%(5) 1.25% 1.04% 0.60%(5) 0.75%(5) 1.46%(5) 1.55% 1.39%(5)
Ratio of expenses to
average net assets prior to
expense limitation ............ 1.76%(5) 1.83% 1.86% 2.00%(5) 2.00%(5) 1.76%(5) 1.82% 1.74%(5)
Ratio of net investment
income to average net assets .. 4.01%(5) 4.37% 4.57% 5.19%(5) 4.43%(5) 4.18%(5) 4.03% 4.00%(5)
Ratio of net investment
income to average net
assets prior to
expense limitation ............ 3.88%(5) 3.79% 3.75% 3.79%(5) 3.18%(5) 3.88%(5) 3.76% 3.65%(5)
Portfolio turnover ............. 5.88%(5) 39.54% 41.08% 0.00% 48.98% 5.88%(5) 39.54% 41.08%

</TABLE>
- ----------
(1) Commencement of operations.
(2) For federal income tax purposes, all of the net investment income
distributions were derived from interest on securities exempt from federal
income tax. For Class A Shares for the year ended October 31, 1994, $.01
per share of distribution from net investment income was subject to state
income tax.
(3) 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.
(4) For the years ended December 31, 1995 and 1996, the expense ratio reflects
the effect of gross expenses attributable to earnings credits on uninvested
cash balances received by the Fund. Prior period expense ratios have not
been adjusted.
(5) Annualized.

21
1997 semi-annual report
<PAGE>

FINANCIAL HIGHLIGHTS (CONTINUED)
- --------------------------------------------------------------------------------

Selected data for each share of the Fund outstanding throughout each period was
as follows:
<TABLE>
<CAPTION>

TAX-FREE WASHINGTON INSURED FUND - A CLASS
------------------------------------------------------------------------------------
SIX MONTHS YEAR YEAR TWO MONTHS YEAR PERIOD FROM
ENDED ENDED ENDED ENDED ENDED 8/1/93(1)
6/30/97 12/31/96 12/31/95 12/31/94 10/31/94 TO 10/31/93
(UNAUDITED)
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period ..... $10.30 $10.44 $9.21 $9.37 $10.67 $10.00
Income from investment operations:
Net investment income ................... 0.27 0.54 0.59 0.09 0.55 0.15
Net realized and unrealized gain
(loss) from investments ................ 0.07 (0.14) 1.21 (0.16) (1.26) 0.67
------- ------- ------- ------- ------ -------
Net increase (decrease) in net assets
from investment operations ............. 0.34 0.40 1.80 (0.07) (0.71) 0.82
------- ------- ------- ------- ------ -------
Less dividends and distributions:
Dividends from net investment income(2) . (0.27) (0.54) (0.57) (0.09) (0.57) (0.15)
Distributions from net realized gain
on security transactions ............... -- -- -- -- (0.02) --
------- ------- ------- ------- ------ -------
Total dividends and distributions ....... (0.27) (0.54) (0.57) (0.09) (0.59) (0.15)
------- ------- ------- ------- ------ -------
Net asset value, end of period ........... $10.37 $10.30 $10.44 $9.21 $9.37 $10.67
======= ======= ======= ======= ====== =======
Total Return(3) ......................... 3.44% 3.98% 19.94% (0.69%) (6.85%) 8.05%

Ratios and supplemental data:
Net assets, end of period (000 omitted) . $2,335 $2,382 $2,099 $2,049 $2,118 $2,108
Ratio of expenses to average net assets(4) 0.49%(5) 0.44% 0.28% 0.10%(5) 0.14% 0.00%
Ratio of expenses to average net
assets prior to expense limitation ..... 1.68%(5) 1.25% 1.25% 1.25%(5) 1.25% 1.25%(5)
Ratio of net investment income to
average net assets ..................... 5.31%(5) 5.29% 5.57% 6.18%(5) 5.44% 5.50%(5)
Ratio of net investment income to
average net assets prior to
expense limitation ..................... 4.12%(5) 4.48% 4.60% 5.03%(5) 4.33% 4.25%(5)
Portfolio turnover ...................... 28.17%(5) 33.30% 50.54% 0.00% 0.00% 45.14%
</TABLE>

- ----------
(1) Commencement of operations.
(2) For federal income tax purposes, all of the net investment income
distributions were derived from interest on securities exempt from federal
income tax. For Class A Shares for the year ended October 31, 1994, $.01
per share of distribution from net investment income was subject to state
income tax.
(3) 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.
(4) For the years ended December 31, 1995 and 1996, the expense ratio reflects
the effect of gross expenses attributable to earnings credits on uninvested
cash balances received by the Fund. Prior period expense ratios have not
been adjusted.
(5) Annualized.

22
1997 semi-annual report
<PAGE>

FINANCIAL HIGHLIGHTS (CONTINUED)
- --------------------------------------------------------------------------------

Selected data for each share of the Fund outstanding throughout each period was
as follows:
<TABLE>
<CAPTION>

TAX-FREE WASHINGTON INSURED FUND - B CLASS TAX-FREE WASHINGTON INSURED FUND - C CLASS
------------------------------------------ ------------------------------------------
SIX MONTHS YEAR PERIOD FROM SIX MONTHS YEAR PERIOD FROM
ENDED ENDED 10/21/95(1) ENDED ENDED 4/21/95(1)
6/30/97 12/31/96 TO 12/31/95 6/30/97 12/31/96 TO 12/31/95
(UNAUDITED) (UNAUDITED)
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period ..... $10.31 $10.44 $10.18 $10.30 $10.43 $9.94
Income from investment operations:
Net investment income ................... 0.23 0.47 0.09 0.21 0.45 0.31
Net realized and unrealized gain
(loss) from investments ................ 0.07 (0.14) 0.25 0.08 (0.14) 0.48
------ ------ ------- ------ ------ -------
Net increase in net assets
from investment operations.............. 0.30 0.33 0.34 0.29 0.31 0.79
------ ------ ------- ------ ------ -------

Less dividends and distributions:
Dividends from net investment income(2) . (0.23) (0.46) (0.08) (0.22) (0.44) (0.30)
------ ------ ------- ------ ------ -------
Total dividends and distributions ....... (0.23) (0.46) (0.08) (0.22) (0.44) (0.30)
------ ------ ------- ------ ------ -------

Net asset value, end of period ........... $10.38 $10.31 $10.44 $10.37 $10.30 $10.43
====== ====== ======= ====== ====== =======

Total Return(3) ......................... 3.03% 3.32% 3.30% 2.98% 3.12% 8.13%

Ratios and supplemental data:
Net assets, end of period (000 omitted) . $722 $516 $15 $56 $19 $19
Ratio of expenses to average net assets(4) 1.24%(5) 1.21% 1.04%(5) 1.25%(5) 1.37% 1.30%(5)
Ratio of expenses to average net
assets prior to expense limitation...... 2.43%(5) 2.00% 2.00%(5) 2.43%(5) 2.00% 2.00%(5)
Ratio of net investment income to
average net assets ..................... 4.55%(5) 4.47% 4.44%(5) 4.54%(5) 4.36% 4.45%(5)
Ratio of net investment income to
average net assets prior to
expense limitation ..................... 3.36%(5) 3.68% 3.48%(5) 3.36%(5) 3.73% 3.75%(5)
Portfolio turnover ...................... 28.17%(5) 33.30% 50.54% 28.17%(5) 33.30% 50.54%
</TABLE>

23
1997 semi-annual report
<PAGE>

THE DELAWARE-VOYAGEUR FUNDS --
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 1997
(UNAUDITED)
- --------------------------------------------------------------------------------
Delaware-Voyageur Tax-Free Idaho Fund (formerly Voyageur Idaho Tax Free
Fund)("Tax-Free Idaho Fund"), is one of a series of funds within the Voyageur
Mutual Funds, Inc.; Delaware-Voyageur Tax-Free Oregon Insured Fund (formerly
Voyageur Oregon Insured Fund)("Tax-Free Oregon Insured Fund") and
Delaware-Voyageur Tax-Free Washington Insured Fund (formerly Voyageur Washington
Insured Tax Free Fund)("Tax-Free Washington Insured Fund"), are funds within the
Voyageur Investment Trust, (each referred to as a "Fund" or collectively as the
"Funds") are registered under the Investment Company Act of 1940 (as amended) as
open-end management investment companies. The Tax-Free Idaho Fund, Tax-Free
Oregon Insured Fund, and Tax-Free Washington Insured Fund are registered as
non-diversified funds. The Tax-Free Idaho Fund seeks high current income free
from both federal and state income taxes by investing in investment grade
municipal bonds. The Tax-Free Oregon Insured Fund and Tax-Free Washington
Insured Fund seek high current income free from both federal and state income
taxes with the added safety of an insured portfolio by investing in insured
municipal bonds.The Funds each offer three classes of shares.

1. Fund Reorganization
On April 30, 1997, Lincoln National Corporation ("LNC") acquired Voyageur Fund
Manager Inc.'s ("Voyageur") parent, Dougherty Financial Group, Inc. ("DFG")
pursuant to an agreement and plan of merger dated January 15, 1997, in which LNC
would acquire DFG including the mutual fund investment advisory business of DFG
conducted by Voyageur. Upon completion of the acquisition, Delaware Management
Company, Inc. ("DMC") became the investment adviser to the Funds, Delaware
Distributors, L.P. ("DDLP") became the distributor for the Funds, Delaware
Service Company, Inc. ("DSC") became the transfer, dividend-disbursing,
shareholder servicing agent and accounting service agent for the Funds.

2. Significant Accounting Policies
The following accounting policies are in accordance with generally accepted
accounting principles and are consistently followed by the Funds.

Security Valuation - Long-term debt securities are valued by an independent
pricing service and such prices are believed to reflect the fair value of such
securities. Money market instruments having less than 60 days to maturity are
valued at amortized cost which approximates market value. Other securities and
assets for which market quotations are not readily available are valued at fair
value as determined in good faith by or under the direction of the Fund's Board
of Directors.

Federal Income Taxes - Each Fund intends to continue to qualify as a regulated
investment company and make the requisite distributions to shareholders.
Accordingly, no provision for federal income taxes has been made in the
financial statements. Income and capital gain distributions are determined in
accordance with federal income tax regulations which may differ from generally
accepted accounting principles.

Class Accounting - Investment income, common expenses and realized and
unrealized gain (loss) on investments are allocated to the various classes of
the Funds on the basis of daily net assets of each class. Distribution expenses
relating to a specific class are charged directly to that class.

Other - Expenses common to all Funds within the Delaware-Voyageur Funds are
allocated amongst the Funds on the basis of average net assets. Security
transactions are recorded on the date the securities are purchased or sold
(trade date). Costs used in calculating realized gains and losses on the sale of
investment securities are those of the specific securities sold. Interest income
is recorded on the accrual basis. Original issue discounts are accreted to
interest income over the lives of the respective securities. The

<PAGE>

Funds declare dividends from net investment income daily and pay them monthly.
Capital gains are distributed annually.

Use of Estimates - The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities at
the date of the financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ from those
estimates.

3. Investment Management and Other Transactions with Affiliates
Commencing May 1, 1997, and in accordance with the terms of the Investment
Management Agreement, the Fund pays DMC the Investment Manager of each Fund, an
annual fee, which is calculated daily on the average daily net assets of each
Fund. The management fee rates are as follows:

Tax-Free Tax-Free
Tax-Free Oregon Washington
Idaho Fund Insured Fund Insured Fund
---------- ------------ ------------
Management fee as a
percentage of average
daily net assets
(per annum)................ 0.50% 0.50% 0.50%

DMC has elected to waive their fees and reimburse each Fund to the extent that
annual operating expenses exclusive of taxes, interest, brokerage commissions
12b-1 fees and extraordinary expenses, exceed 0.62%, 0.46%, 0.25%, of average
daily net assets for the Tax-Free Idaho Fund, Tax-Free Oregon Insured Fund, and
the Tax-Free Washington Insured Fund, respectively, through December 31, 1997.
Total expenses absorbed by DMC for the two month period ended June 30, 1997 are
as follows:
Tax-Free Tax-Free
Tax-Free Oregon Washington
Idaho Fund Insured Fund Insured Fund
---------- ------------ ------------
Total expenses
absorbed by DMC ........... $2,893 $7,506 $3,210

Prior to May 1, 1997, the Funds had an investment advisory and management
agreement with Voyageur. Voyageur received a fee for its investment advisory and
management services based on the average daily net assets of the Tax Free Idaho
Fund, Tax-Free Oregon Insured Fund and Tax-Free Washington Insured Fund at an
annual rate of .50%. During the period January 1, 1997 to April 30, 1997,
Voyageur waived $30,002, $19,764, and $12,854 of the Tax-Free Idaho Fund,
Tax-Free Oregon Insured Fund, and Tax-Free Washington Insured Fund.

Commencing May 1, 1997, the Funds have engaged DSC, an affiliate of DMC, to
serve as dividend disbursing, transfer agent and accounting services agent for
the Fund. For the two month period ended June 30, 1997, the amounts expensed for
each Fund were as follows:
Tax-Free Tax-Free
Tax-Free Oregon Washington
Idaho Fund Insured Fund Insured Fund
---------- ------------ ------------
Dividend disbursing, transfer
agent fees and other
expenses ................... $11,698 $8,690 $3,343
Accounting fees ............. $2,373 $1,688 $201

1997 semi-annual report
<PAGE>

NOTES TO FINANCIAL STATEMENTS (CONTINUED)
- --------------------------------------------------------------------------------

Prior to May 1, 1997, the Funds paid a fee to Voyageur for acting as the Fund's
dividend disbursing, administrative and accounting services agent. Each Fund is
also responsible for reimbursing Voyageur's out-of-pocket expense in connection
with the performance of dividend-disbursing, administrative andaccounting
services.

On June 30, 1997, the Funds had payables to affiliates as follows:

Tax-Free Tax-Free
Tax-Free Oregon Washington
Idaho Fund Insured Fund Insured Fund
---------- ------------ ------------
Investment Management fee
payable to DMC ................. $15,846 $11,139 $1,276
Dividend disbursing, transfer
agent fees, accounting fees
and other expenses
payable to DSC ................. $2,747 $2,325 $282
Other expenses payable to
DMC and affiliates ............. $1,958 $3,452 $968

Commencing May 1, 1997, and pursuant to the Distribution Agreement, the Funds
pay DDLP, the Distributor and an affiliate of DMC, an annual fee not to exceed
0.25% of the average daily net assets of the A Class and 1.00% of the average
daily net assets of the B and C Class for each Series. For the period May 1,
1997 to June 30, 1997, DDLP voluntarily waived $2,511 for the Tax-Free Idaho
Fund Class B Shares, $1,648, $3,158 for the Tax-Free Oregon Insured Fund Class A
and Class B Shares, respectively, $437, $108 for the Tax-Free Washington Insured
Fund Class A and Class B Shares, respectively. For the two month period ended
June 30, 1997, DDLP earned commissions on sales of the Fund A Class shares for
each Fund as follows:

Tax-Free Tax-Free
Tax-Free Oregon Washington
Idaho Fund Insured Fund Insured Fund
---------- ------------ ------------
$24,309 $7,322 $485
<PAGE>

Prior to May 1, 1997 each class of shares had a Distribution Agreement with
Voyageur Fund Distributors, Inc. ("VFD"). Under the plan the Funds paid VFD a
fee at an annual rate of 0.25% of the average daily net assets of the Class A
Shares and 1.00% of the average daily net assets of the Class B and C Shares.
For the period January 1, 1997, to April 30, 1997, VFD voluntarily waived $4,554
for the Tax-Free Idaho Fund Class B Shares, $6,207 $3,203 for the Tax-Free
Oregon Insured Fund Class A and Class B Shares, respectively, $873, $192 for the
Tax-Free Washington Insured Fund Class A and Class B Shares, respectively.

Certain officers of DMC, DSC and DDLP are officers, directors and/or employees
of the Fund. These officers, directors and employees are paid no compensation by
the Fund.

4. Investments
During the period ended June 30, 1997, the Fund made purchases and sales of
investment securities other than U.S. government securities and temporary cash
investments for each Fund as follows:

Tax-Free Tax-Free
Tax-Free Oregon Washington
Idaho Fund Insured Fund Insured Fund
---------- ------------ ------------
Purchases.................... $6,620,178 $979,950 $408,000
Sales........................ 2,466,350 737,330 446,013

At June 30, 1997, the aggregate unrealized appreciation (depreciation) of
securities for federal income tax purposes for each Fund were as follows:

Tax-Free Tax-Free
Tax-Free Oregon Washington
Idaho Fund Insured Fund Insured Fund
---------- ------------ ------------
Aggregate unrealized
appreciation.................. $1,007,263 $1,141,244 $112,960
Aggregate unrealized
depreciation.................. 50 - -
Net unrealized appreciation.... 1,007,213 1,141,244 112,960

For federal income tax purposes, as of December 31, 1996, Tax-Free Idaho Fund
had a capital loss carryover of $2,504,886 that will expire in 2003, Tax-Free
Oregon Insured Fund had a capital loss carryover of $7,559,777 that will expire
in 2001 through 2003, and Tax-Free Washington Insured Fund had a capital loss
carryover of $789,263 that will expire in 2003.

1997 semi-annual report
<PAGE>

NOTES TO FINANCIAL STATEMENTS (CONTINUED)
- --------------------------------------------------------------------------------

5. Capital Stock
<TABLE>
<CAPTION>

TAX-FREE IDAHO TAX-FREE OREGON TAX-FREE WASHINGTON
INSURED FUND INSURED FUND INSURED FUND
------------------------ ---------------------- ----------------------

SIX MONTHS YEAR SIX MONTHS YEAR SIX MONTHS YEAR
ENDED ENDED ENDED ENDED ENDED ENDED
6/30/97 12/31/96 6/30/97 12/31/96 6/30/97 12/31/96
(UNAUDITED) (UNAUDITED) (UNAUDITED)
--------- -------- --------- -------- --------- --------
<S> <C> <C> <C> <C> <C> <C>
Shares sold:
A Class .................................... 413,312 1,392,372 191,929 448,613 19,051 50,130
B Class .................................... 112,851 283,576 53,670 254,637 28,164 50,610
C Class .................................... 41,930 34,723 10,952 28,508 3,466 93

Shares issued upon reinvestment of
dividends from net investment income
A Class .................................... 42,172 55,095 34,662 60,566 3,363 5,366
B Class .................................... 6,211 5,873 7,381 9,000 762 530
C Class .................................... 1,660 3,898 477 696 12 0
------- --------- ------- ------- ------ -------
618,136 1,775,537 299,071 802,020 54,818 106,729
------- --------- ------- ------- ------ -------

Shares repurchased:
A Class .................................... (188,267) (137,976) (192,517) (539,553) (28,445) (25,440)
B Class .................................... (7,725) (15,168) (25,843) (58,924) (9,377) (2,606)
C Class .................................... (42,386) (34,878) (1,523) (17,624) 0 0
------- --------- ------- ------- ------ -------
(238,378) (188,022) (219,883) (616,101) (37,822) (28,046)
------- --------- ------- ------- ------ -------

Net Increase ................................ 379,758 1,587,515 79,188 185,919 16,996 78,683
======= ========= ====== ======= ====== ======
</TABLE>

6. Concentration of Credit Risk
The Funds may invest up to 15% of its total assets in illiquid securities which
may include securities with contractual restrictions on resale, securities
exempt from registration under Rule 144A of the Securities Act of 1933, as
amended, and other securities which may not be readily marketable. The relative
illiquidity of some of these securities may adversely affect the Fund's ability
to dispose of such securities in a timely manner and at a fair price when it is
necessary to liquidate such securities. These securities, if any, have been
denoted in the Statement of Net Assets.

The Funds concentrate their investments in securities mainly issued by each
specific states' municipalities. The value of these investments may be adversely
affected by new legislation within the state, regional of local economic
conditions, and differing levels of supply and demand for municipal bonds. Many
municipalities insure repayment for their obligations. Although bond insurance
reduces the risk of loss due to default by an issuer, such bonds remain subject
to the risk that market value may fluctuate for other reasons and there is no
assurance that the insurance company will meet its obligations. These securities
have been identified in the Statement of Net Assets.

1997 semi-annual report
<PAGE>

VOYAGEUR FUNDS
SHAREHOLDER MEETING RESULTS
- --------------------------------------------------------------------------------

A meeting of the funds' shareholders was held on April 11, 1997. The matters
submitted to a vote of shareholders were the election of new directors and the
approval of a new investment management agreement. Whenever there is a change in
control of an investment manager, the Investment Company Act of 1940 requires
shareholders to vote on a new investment management agreement.

TAX-FREE IDAHO FUND
<TABLE>
<CAPTION>

NUMBER OF VOTES
-------------------------------------------------------
FOR AGAINST / WITHHELD ABSTENTIONS
-------------------------------------------------------

<S> <C> <C>
Walter P. Babich .................................... 2,085,908 24,195 --
Anthony D. Knerr .................................... 2,090,350 19,753 --
Ann R. Leven ........................................ 2,090,350 19,753 --
W. Thacher Longstreth ............................... 2,090,350 19,753 --
Thomas F. Madison ................................... 2,090,350 19,753 --
Jeffrey J. Nick ..................................... 2,090,350 19,753 --
Charles E. Peck ..................................... 2,090,350 19,753 --
Wayne A. Stork ...................................... 2,090,350 19,753 --

Approval of New Investment Management Agreement ..... 1,863,690 18,422 227,991

TAX-FREE OREGON INSURED FUND

NUMBER OF VOTES
-------------------------------------------------------
FOR AGAINST / WITHHELD ABSTENTIONS
-------------------------------------------------------
Walter P. Babich .................................... 2,159,448 18,405 --
Anthony D. Knerr .................................... 2,161,818 16,035 --
Ann R. Leven ........................................ 2,161,818 16,035 --
W. Thacher Longstreth ............................... 2,161,818 16,035 --
Thomas F. Madison ................................... 2,161,269 16,584 --
Jeffrey J. Nick ..................................... 2,161,666 16,187 --
Charles E. Peck ..................................... 2,161,818 16,035 --
Wayne A. Stork ...................................... 2,161,818 16,035 --

Approval of New Investment Management Agreement ..... 2,007,809 13,422 156,622

TAX-FREE WASHINGTON INSURED FUND

NUMBER OF VOTES
-------------------------------------------------------
FOR AGAINST / WITHHELD ABSTENTIONS
-------------------------------------------------------
Walter P. Babich .................................... 229,147 -- --
Anthony D. Knerr .................................... 229,147 -- --
Ann R. Leven ........................................ 229,147 -- --
W. Thacher Longstreth ............................... 229,147 -- --
Thomas F. Madison ................................... 229,147 -- --
Jeffrey J. Nick ..................................... 229,147 -- --
Charles E. Peck ..................................... 229,147 -- --
Wayne A. Stork ...................................... 229,147 -- --

Approval of New Investment Management Agreement ..... 228,585 562 --

</TABLE>
27
1997 semi-annual report
<PAGE>

THIS SEMI-ANNUAL REPORT IS FOR THE INFORMATION OF TAX-FREE IDAHO FUND, TAX-FREE
OREGON INSURED FUND AND TAX-FREE WASHINGTON INSURED FUND SHAREHOLDERS, BUT IT
MAY BE USED WITH PROSPECTIVE INVESTORS WHEN PRECEDED OR ACCOMPANIED BY A CURRENT
PROSPECTUS FOR TAX-FREE IDAHO FUND, TAX-FREE OREGON INSURED FUND OR TAX-FREE
WASHINGTON INSURED FUND. PROSPECTUSES SET FORTH DETAILS ABOUT CHARGES, EXPENSES,
INVESTMENT OBJECTIVES AND OPERATING POLICIES OF THE FUNDS. YOU SHOULD READ THE
PROSPECTUS CAREFULLY BEFORE YOU INVEST. SUMMARY INVESTMENT RESULTS ARE
DOCUMENTED IN THE FUNDS' CURRENT STATEMENT OF ADDITIONAL INFORMATION. THE
FIGURES IN THIS REPORT REPRESENT PAST RESULTS WHICH ARE NOT A GUARANTEE OF
FUTURE RESULTS. THE RETURN AND PRINCIPAL VALUE OF AN INVESTMENT IN THE FUNDS
WILL FLUCTUATE SO THAT SHARES, WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN
THEIR ORIGINAL COST.

INVESTMENT MANAGER
Delaware Management Company, Inc.
Philadelphia

NATIONAL DISTRIBUTOR
Delaware Distributors, L.P.
Philadelphia

SHAREHOLDER SERVICING,
DIVIDEND DISBURSING AND
TRANSFER AGENT
Delaware Service Company, Inc.
Philadelphia

1818 Market Street
Philadelphia, PA 19103-3682

FOR SHAREHOLDERS
1.800.523.1918

FOR SECURITIES DEALERS
1.800.362.7500

FOR FINANCIAL INSTITUTIONS
REPRESENTATIVES
1.800.659.2265

Be sure to consult your financial adviser when making investments. Mutual funds
can be a valuable part of your financial plan: however, shares of the Funds are
not FDIC or NCUSIF insured, are not guaranteed by any bank or any credit union,
and involve investment risk, including the possible loss of the principal amount
invested. Shares of the Funds are not bank or credit union deposits.

Copy Rights Delaware Distributors, L.P.

Printed in the USA on
recycled paper

(138)
SA-VOY2 [--] PP8/97

DELAWARE
GROUP
- --------
Philadelphia o London