<PAGE>
DELAWARE(SM)
INVESTMENTS
- -----------
Delaware Tax-Free Florida Fund
Delaware Tax-Free Florida Insured Fund
Delaware Tax-Free New York Fund
Tax-Exempt Income
2000 SEMI-ANNUAL REPORT
(Tax-Exempt Income Artwork)
<PAGE>
A TRADITION OF SOUND INVESTING SINCE 1929
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TABLE OF CONTENTS
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Letter to Shareholders 1
Portfolio
Management Review 3
Performance Summary
Delaware Tax-Free
Florida Fund 6
Delaware Tax-Free
Florida Insured Fund 7
Delaware Tax-Free
New York Fund 8
Financial Statements
Statements of Net Assets 9
Statement of Operations 16
Statements of Changes in
Net Assets 17
Financial Highlights 18
Notes to Financial
Statements 26
<PAGE>
A Commitment To Our Investors
Experienced
o Our seasoned investment professionals average more than 15 years' experience.
o For over 70 years, we have managed money in a variety of investment styles
that have weathered a full range of economic and market environments. We
opened our first mutual fund in 1938.
Disciplined
o We follow strict investment policies and clear buy/sell guidelines.
o We strive to balance risk and reward in order to provide conservative
investment alternatives within any given asset class.
Consistent
o We believe consistent processes are the best way to seek consistent investment
performance.
o Our commitment to style consistency has earned us the confidence of
discriminating institutional and individual investors to manage approximately
$47 billion in assets as of December 31, 1999.
Comprehensive
o We offer over 70 mutual funds in these asset classes.
o Large-cap equity o High-yield bonds
o Mid-cap equity o Investment grade bonds
o Small-cap equity o Municipal bonds (24 single-state funds)
o International equity o International fixed-income
o Balanced
o Our funds are available through financial advisers who can offer you
individualized attention and valuable investment advice.
Funds are not FDIC insured and are not guaranteed. It is possible to lose the
principal amount invested. (C)Delaware Distributors, L.P.
<PAGE>
Dear Shareholder
"MUNICIPAL BONDS WEATHERED THE TURBULENCE IN THE FIXED-INCOME ARENA SOMEWHAT
BETTER THAN U.S. TREASURY SECURITIES DURING THE PAST SIX MONTHS."
March 22, 2000
Recap of Events - Economic activity in the United States continues to move along
ahead of expectations. An improving global economic outlook further enhances the
prospect of continued strong economic growth. During the last six months, U.S.
interest rates, as measured by the Treasury bond market, rose and Treasury bond
prices fell significantly. Interest rates rose for two reasons. First, there was
a perception that inflation would increase. Second, the Federal Reserve was
actively raising short-term interest rates. Each time Federal Reserve Chairman,
Alan Greenspan, addressed the media and spoke of restrictive monetary policy, it
tended to rattle the bond markets further.
The booming stock market, however, did heighten inflationary concerns during our
fiscal period. The Federal Reserve responded by following up their interest rate
increase on June 30, 1999 with four additional increases through March 21, 2000.
As of this writing, the Federal funds target rate on overnight loans between
banks stands at 6.0%, its highest level in five years. The Federal Reserve's
actions have been directed at slowing the economy and pre-empting inflation
before it takes root.
Municipal bonds weathered the turbulence in the fixed-income arena somewhat
better than U.S. Treasury securities during the past six months. Municipal bond
yields increased steadily throughout this time period, but municipal bond prices
fluctuated less than Treasuries (Source: Bloomberg). As of February 29, 2000,
the 30-year U.S. Treasury bond yield stood at 6.15%, while 30-year U.S.
AAA-rated general obligation municipal bonds closed at 5.90%. For investors in
the 28% tax bracket, a 5.90% tax-free yield would be equivalent to an 8.19%
yield on a taxable investment, a yield that surpasses that of the 30-year
Treasury.*
Average Total Returns
For Period Ended February 29, 2000 Six Months
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Delaware Tax-Free Florida Fund Class A -2.33%
Delaware Tax-Free Florida Insured Fund Class A -0.61%
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Lipper Florida Municipal Debt Fund Average (64 funds) -1.36%
Lipper Florida Insured Municipal Debt Fund Average (14 funds) -0.97%
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Delaware Tax-Free New York Fund Class A -1.57%
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Lipper New York Municipal Debt Fund Average (104 funds) -1.27%
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Lehman Brothers Municipal Bond Index -0.24%
Lehman Brothers Insured Municipal Bond Index -0.21%
- --------------------------------------------------------------------------------
All performance shown above is at net asset value and assumes reinvestment of
dividends and capital gains. Performance information for all Fund classes can be
found on pages 6, 7 and 8. The Lipper categories represent the average returns
of municipal bond funds with similar investment objectives tracked by Lipper
Analytical. (Source: Lipper Analytical Services, Inc.) The unmanaged Lehman
Brothers Indexes are composed of bonds with a variety of quality ratings from
many states. You cannot invest directly in an index. Past performance does not
guarantee future results.
* The U.S. government does not guarantee principal and interest of municipal
bonds, unlike Treasuries. Municipal bonds have historically had annual default
rates of less than 2%.
1
<PAGE>
"WE BELIEVE FIXED-INCOME INVESTMENTS PLAY AN IMPORTANT
ROLE IN WELL-BALANCED PORTFOLIOS..."
(Tax-Exempt Income Artwork)
Delaware's New York and Florida Municipal Bond Funds - Given the prevailing
market conditions, your Funds' portfolio managers followed a defensive strategy
of shortening portfolio duration while maintaining credit quality. As a result,
we were able to maintain or increase the overall yield of Delaware's Florida and
New York tax-free municipal bond funds, but at a lower level of interest rate
risk. This strategy worked well for the Delaware Tax-Free Florida Insured Fund
and the Delaware Tax-Free New York Fund. The Delaware Tax-Free Florida Fund's
relatively longer duration position hurt the Fund's performance during the
period.
Market Outlook - We believe fixed-income investments play an important role in
well-balanced portfolios, even as stocks continue to capture more attention and
a larger share of investors' assets. Looking forward, we believe bonds may
remain in the shadow of stocks as long as economic growth continues in 2000.
However, tax-exempt municipal bonds, which your Funds hold, remain popular with
investors for good reason. They offer a wide range of benefits, including:
o Attractive current income that is free from federal,* and in the case of
Delaware Tax-Free Florida and New York Funds, free of certain state and
local taxes as well;
o A high likelihood that interest and principal payments will be made as
scheduled; and,
o A wide range of choices to meet your investment objectives with regard to
investment quality, maturity, type of bond and geographical location.
We realize that the past six months have been a difficult period for
fixed-income investors. In this environment, we believe the best strategy is to
patiently reap the bounty of interest payments, without taking risky bets on
specific sectors or the direction of interest rates. We applaud you for
remaining committed to your investment plan and thank you for your continued
confidence in Delaware Investments.
Sincerely,
/s/ Wayne A. Stork /s/ David K. Downes
Wayne A. Stork David K. Downes
Chairman, President and Chief Executive Officer,
Delaware Investments Delaware Investments
Family of Funds Family of Funds
* A portion of the income from tax-exempt funds may be subject to the
alternative minimum tax.
2
<PAGE>
PORTFOLIO MANAGEMENT REVIEW
Mitchell L. Conery
Senior Portfolio Manager
Patrick P. Coyne
Senior Portfolio Manager
March 22, 2000
"OVER THE LAST SIX MONTHS, WE HAVE WITNESSED A COMBINATION OF MARKET EVENTS THAT
HAVE PUSHED MUNICIPAL BOND YIELDS HIGHER AND PRICES LOWER."
Delaware Tax-Free Florida Fund
Portfolio Characteristics
February 29, 2000
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Current 30-Day SEC Yield*
Before expense limitation 4.73%
After expense limitation 5.16%
Average Effective Duration 8.2 years
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Average Effective Maturity** 14.0 years
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* For Class A shares measured according to Securities and Exchange Commission
(SEC) guidelines. Current 30-day SEC yield as of 2/29/00 for Class B shares
was 4.16% before the expense limitation and 4.61% after the expense
limitation. For Class C shares, the yield was 4.17% before the expense
limitation and 4.62% after the limitation. Duration is a common measure of a
bond or bond fund's sensitivity to interest rates.
** Average effective maturity is the average time remaining until scheduled
replacement by issuers of portfolio securities.
The Funds' Results
Over the last six months, we have witnessed a combination of market events that
have pushed municipal bond yields higher and prices lower. Concerns related to
year 2000 computer issues helped reduce the amount of municipal bonds being
issued. Most municipalities issued bonds earlier in the year and sat out the end
of the year. In addition, investors' interest in municipal bonds was somewhat
weak compared to their intense attention to the equity markets.
In spite of the reduced supply of new bonds at year-end, the total supply of
municipal bonds was ample and that gave us the opportunity to select bonds that
have solid credit ratings and the potential for future price appreciation. Based
on value measures, the relationship of municipal bonds to Treasury bonds
vacillated throughout the year. In our view, municipal bonds offered better
relative value for much of the time.
Delaware Tax-Free Florida Fund had a total return of -2.33% (Class A shares at
net asset value with distributions reinvested) for the six-month period ended
February 29, 2000. We shortened the duration of Delaware Tax-Free Florida Fund
over the past six months from 9.2 years to 8.2 years. Duration is a common
measure of a bond or bond fund's sensitivity to interest rates. Currently, our
duration is slightly longer than the average duration of the funds in the Lipper
Florida Municipal Debt Funds (Source: Lipper Analytical Services, Inc.). Because
of this, when interest rates went up, our bond prices declined more than mutual
funds that were shorter in duration.
We maintain a focus on high-grade bonds so that as we aim to increase the Fund's
income potential, we will not significantly increase our credit risk. As of
February 29, 2000, over 80% of Delaware Tax-Free Florida Fund's net assets were
allocated to bonds rated investment grade (bonds rated BBB or higher by Moody's
or Standard & Poor's).
3
<PAGE>
Delaware Tax-Free Florida Insured Fund
Portfolio Characteristics
February 29, 2000
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Current 30-Day SEC Yield*
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Before expense limitation 4.76%
After expense limitation 4.77%
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Average Effective Duration 7.5 years
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Average Effective Maturity** 12.4 years
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* For Class A shares measured according to Securities and Exchange Commission
(SEC) guidelines. Current 30-day SEC yields as of 2/29/00 for Class B and C
shares were 4.20% before the expense limitation, and 4.21% after the expense
limitation. Duration is a common measure of a bond or bond fund's sensitivity
to interest rates.
** Average effective maturity is the average time remaining until scheduled
replacement by issuers of portfolio securities.
Delaware Tax-Free New York Fund Portfolio Characteristics
February 29, 2000
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Current 30-Day SEC Yield*
Before expense limitation 4.18%
After expense limitation 4.91%
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Average Effective Duration 8.4 years
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Average Effective Maturity** 16.6 years
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* For Class A shares measured according to Securities and Exchange Commission
(SEC) guidelines. Current 30-day SEC yield as of 2/29/00 for Class B and C
shares were 3.61% before the expense limitation, and 4.37% after the expense
limitation.
** Average effective maturity is the average time remaining until scheduled
replacement by issuers of portfolio securities.
(Tax-Exempt Income Artwork)
Delaware Tax-Free Florida Insured Fund had a total return of -0.61% (Class A
Shares at net asset value with distributions reinvested) for the six-month
period ended February 29, 2000. During this difficult period, we succeeded in
preserving capital to a greater degree than the Fund's peer group represented by
the Lipper Florida Insured Municipal Debt Fund Average, which had a -0.97%
average return for the same six-month period.
In order to remain consistent with the Fund's more conservative investment
objectives, we maintain a shorter duration for Delaware Tax-Free Florida Insured
Fund than for Delaware Tax-Free Florida Fund. We shortened Delaware Tax-Free
Florida Insured Fund's average duration over the last six months from 8.8 years
to 7.5 years. The shorter duration, which means less sensitivity to interest
rate changes, helped the Fund's performance in a rising interest rate
environment.
Over the last six months, more than 50% of all new municipal issues were insured
according to Securities Data Corporation. This demonstrates the demand for the
added security of insured municipal bonds. The bonds in Delaware Tax-Free
Florida Insured Fund's portfolio are protected by private insurance, which
guarantees the timely payment of principal and interest but does not guarantee
against price volatility.
As mandated by the Fund's investment policies, Delaware Tax-Free Florida Insured
Fund continues to invest exclusively in insured municipal bonds rated AAA by
Moody's or Standard & Poor's, the highest credit rating available.
Delaware Tax-Free New York Fund provided a total return of -1.57% (Class A
shares at net asset value with distributions reinvested) for the six-month
period ended February 29, 2000. The Fund slightly underperformed its peer group.
We attribute this underperformance partially to the Fund's average effective
duration. At the start of our fiscal period, the duration stood at 9.6 years,
which was longer than that of its peers as represented by the Lipper New York
Municipal Debt Fund Average.
As inflation fears continued and it became apparent that the Federal Reserve
Board would continue to raise the federal funds rate, we shortened the duration
of the Fund. As of February 29, 2000, Delaware Tax-Free New York Fund's duration
was positioned at 8.4 years, which was in line with the average duration of its
peer group.
4
<PAGE>
"REGARDLESS OF MARKET CONDITIONS, MUNICIPAL BOND FUNDS HAVE THE POTENTIAL TO
OFFER VALUABLE ASSET ALLOCATION BENEFITS WITHOUT ADDING TO YOUR TAXABLE
INVESTMENT INCOME."*
To offset the risk associated with investing in bonds of this duration, we
maintained our focus on pre-refunded bonds. Pre-refunded bonds are seasoned
securities that have been refinanced by municipalities in a lower interest rate
environment. Pre-refunded bonds are secured by an escrow account consisting of
U.S. government securities. Over the last six months, pre-refunded bonds
represented over 24% of your Fund's holdings and many had relatively high coupon
rates (the stated rate of interest on the bond) that have added to the Fund's
dividend. Pre-refunded bonds help the Fund because:
o The credit quality of the bonds typically increases because of the high
quality of the escrow fund.
o The price usually increases because the bond is now backed by U.S.
Treasuries and will be retired before its stated final maturity.
o In general, prices for these bonds are less sensitive to interest rate
fluctuations because of the shorter durations.
In most cases, once a bond is pre-refunded we continue to hold it. This normally
allows the Fund to collect an attractive level of current income and benefit
from better protection of principal. Pre-refunded bonds performed especially
well in the rising interest rate environment that we've experienced over the
last six months.
Outlook
The U.S. seems to be the engine of growth for the entire world at this time. We
believe strong forward momentum for the U.S. economy is likely to result in
solid growth for the remainder of this year. We don't think this will create an
inflationary environment if labor productivity continues to increase.
The Federal Reserve has been on a path of increasing short-term interest rates.
There have been five one-quarter point increases in short-term interest rates
since June 1999. Clearly, the Federal Reserve's goal is to slow the pace of U.S.
economic climate to what it believes is a non-inflationary rate of growth.
We have seen some slowdown in the economy and the equity markets, as evidenced
by the decline in the Dow Jones Industrial Average, which is down -12.56% for
the six-month period ended February 29, 2000. We think longer term bonds -
including municipal bonds - could potentially increase in price if the equity
market remains subdued.
Regardless of market conditions, municipal bond funds have the potential to
offer valuable asset allocation benefits without adding to your taxable
investment income.* In our view, investors seeking to diversify their portfolios
with generally less volatile investments will continue to find attractive
opportunities in municipal bonds and municipal bond funds in the years to come.
* A portion of the income from tax-exempt funds may be subject to the
alternative minimum tax.
5
<PAGE>
FUND BASICS
Fund Objective
This Fund seeks high current income free from both federal income taxes and
state intangibles tax by investing in investment grade municipal bonds.
Assets Under Management
$13.64 million
Number of Holdings
36
Fund Start Date
March 2, 1995
Your Fund Managers
Mitchell L. Conery received a bachelor's degree from Boston University and an
MBA in Finance from the State University of New York. Prior to joining Delaware
Investments in 1997, he served as an Investment Officer with the Travelers
Group. Before that, he held positions at CS First Boston Corporation, MBIA
Corporation, Thomson McKinnon Securities, Ovest Financial Services, and Merrill
Lynch.
Patrick P. Coyne received a bachelor's degree from Harvard University and an MBA
in Finance from the University of Pennsylvania's Wharton School. He began his
career with Kidder, Peabody & Co., where he managed the firm's trading desk for
four years. He joined Delaware Investments in 1989.
NASDAQ Symbols
Class A DVFAX
Class B DVFBX
Class C DVFCX
[TAX-EXEMPT INCOME ARTWORK]
DELAWARE TAX-FREE FLORIDA FUND PERFORMANCE
Average Total Returns
Through February 29, 2000 Lifetime One Year
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Class A (Est. 3/2/95)
Excluding Sales Charge +5.60% -5.47%
Including Sales Charge +4.79% -8.98%
- --------------------------------------------------------------------------------
Class B (Est. 9/15/95)
Excluding Sales Charge +4.14% -6.26%
Including Sales Charge +3.76% -9.86%
- --------------------------------------------------------------------------------
Class C (Est. 4/22/95)
Excluding Sales Charge +4.39% -6.27%
Including Sales Charge +4.39% -7.17%
- --------------------------------------------------------------------------------
Returns reflect reinvestment of distributions and any applicable sales charges
as noted below. Returns and share values will fluctuate so that shares, when
redeemed, may be worth more or less than the original share price. Class B and C
results, excluding sales charge, assume either that contingent sales charges did
not apply or the investment was not redeemed. Past performance does not
guarantee future results.
Class A shares have a 3.75% maximum front-end sales charge and a 12b-1 fee.
Class B shares do not have a front-end sales charge, but are subject to a 1%
annual distribution and service fee. They are also subject to a contingent
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.
An expense limitation was in effect for all classes of Delaware Tax-Free Florida
Fund during the period. Performance would have been lower if the expense
limitation was not in effect.
6
<PAGE>
FUND BASICS
Fund Objective
This Fund seeks high current income free from both federal income taxes and
state intangibles tax with the added safety of an insured portfolio by investing
in insured municipal bonds.
Assets Under Management
$119.40 million
Number of Holdings
47
Fund Start Date
January 1, 1992
Your Fund Managers
Mitchell L. Conery
Patrick P. Coyne
NASDAQ Symbols
Class A VFLIX
Class B DVDBX
Class C N/A
DELAWARE TAX-FREE FLORIDA INSURED
FUND PERFORMANCE
Average Total Returns
Through February 29, 2000 Lifetime Five Years One Year
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Class A (Est. 1/1/92)
Excluding Sales Charge +6.11% +5.48% -3.71%
Including Sales Charge +5.62% +4.68% -7.30%
- --------------------------------------------------------------------------------
Class B (Est. 3/11/94)
Excluding Sales Charge +4.22% +4.83% -4.45%
Including Sales Charge +4.08% +4.49% -8.12%
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Class C (Est. 9/30/97)
Excluding Sales Charge -0.07% -4.45%
Including Sales Charge -0.07% -5.36%
- --------------------------------------------------------------------------------
Returns reflect reinvestment of distributions and any applicable sales charges
as noted below. Returns and share values will fluctuate so that shares, when
redeemed, may be worth more or less than the original share price. Class B and C
results, excluding sales charge, assume either that contingent sales charges did
not apply or the investment was not redeemed. Past performance does not
guarantee future results.
Class A shares of each Fund have a 3.75% maximum front-end sales charge and a
12b-1 fee.
Class B shares do not have a front-end sales charge, but are subject to a 1%
annual distribution and service fee. They are also subject to a contingent
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.
An expense limitation was in effect for all classes of Delaware Tax-Free Florida
Insured Fund during the period. Performance would have been lower if the expense
limitation was not in effect.
7
<PAGE>
FUND BASICS
Fund Objective
This Fund seeks high current income free from both federal and state income
taxes by investing in investment grade municipal bonds.
Assets Under Management
$11.37 million
Number of Holdings
23
Fund Start Date
November 6, 1987
Your Fund Managers
Mitchell L. Conery
Patrick P. Coyne
NASDAQ Symbols
Class A FTNYX
Class B DVTNX
Class C DVFNX
[TAX-EXEMPT INCOME ARTWORK]
DELAWARE TAX-FREE NEW YORK FUND
PERFORMANCE
Average Total Returns
Through February 29, 2000 Lifetime 10 Years Five Years One Year
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Class A (Est. 11/6/87)
Excluding Sales Charge +6.13% +5.44% +3.28% -6.01%
Including Sales Charge +5.80% +5.04% +2.49% -9.50%
- --------------------------------------------------------------------------------
Class B (Est. 11/14/94)
Excluding Sales Charge +3.35% +2.44% -6.73%
Including Sales Charge +3.20% +2.12% -10.29%
- --------------------------------------------------------------------------------
Class C (Est. 4/26/95)
Excluding Sales Charge +2.27% -6.64%
Including Sales Charge +2.27% -7.53%
- --------------------------------------------------------------------------------
Returns reflect reinvestment of distributions and any applicable sales charges
as noted below. Returns and share values will fluctuate so that shares, when
redeemed, may be worth more or less than the original share price. Class B and C
results, excluding sales charge, assume either that contingent sales charges did
not apply or the investment was not redeemed. Past performance does not
guarantee future results.
Class A shares of each Fund have a 3.75% maximum front-end sales charge and a
12b-1 fee.
Class B shares do not have a front-end sales charge, but are subject to a 1%
annual distribution and service fee. They are also subject to a contingent
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.
An expense limitation was in effect for all classes of Delaware Tax-Free New
York Fund during the period. Performance would have been lower if the expense
limitation was not in effect.
8
<PAGE>
Statements of Net Assets
DELAWARE TAX-FREE FLORIDA FUND
- ------------------------------
Principal Market
February 29, 2000 (Unaudited) Amount Value
- --------------------------------------------------------------------------------
Municipal Bonds - 101.18%
Continuing Care/Retirement Revenue Bonds - 7.03%
Jacksonville Health Facilities Authority
(Cypress Village Project National
Benevolent Association) Series A
6.125% 12/1/16 ................................... $ 200,000 $180,324
Orange County, Florida Health Facilities
(Mayflower Retirement Project)
5.25% 6/1/19 ..................................... 360,000 322,625
Palm Beach Health Facilities Authority
(ACTs Obligated Group)
5.625% 11/15/20 .................................. 250,000 208,868
Volusia County Health Facilities Authority
(John Knox Village) Series A
6.00% 6/1/17 ..................................... 250,000 247,853
----------
959,670
----------
General Obligation Bonds - 2.96%
Florida State Board of Education
(Cap Outlay Public Education)
6.00% 6/1/21 ..................................... 400,000 403,864
----------
403,864
----------
Higher Education Revenue Bonds - 2.86%
Pinellas County Educational Facilities
Authority (Clearwater Christian College)
Private Placement 8.00% 2/1/11 ................... 375,000 390,071
----------
390,071
----------
Highway Revenue Bonds - 2.40%
Dunes Community Development District-
Intracoastal Waterway Bridge
(ITT Industries Corporation)
5.50% 10/1/07 .................................... 175,000 173,073
Florida State Mid-Bay Bridge Authority
Series D 6.125% 10/1/22 .......................... 160,000 154,587
----------
327,660
----------
Hospitals Revenue Bonds - 15.51%
Hillsborough County Industrial Development
Authority (University Community Hospital)
5.625% 8/15/23 ................................... 1,000,000 795,210
Hillsborough County (Tampa General
Hospital) 6.375% 10/1/13 (FSA) ................... 100,000 104,067
Lee County Hospital Board (Lee Memorial
Hospital) 6.35% 3/26/20 (MBIA) ................... 500,000 509,220
Leesburg Regional Medical Center Project
Series A 6.125% 7/1/12 ........................... 100,000 100,192
North Miami Health Facilities Authority
(Catholic Health Services) 6.00% 8/15/16
(LOC Suntrust Bank-Miami) ........................ 500,000 498,430
<PAGE>
Principal Market
Amount Value
- --------------------------------------------------------------------------------
Municipal Bonds (continued)
Hospitals Revenue Bonds (continued)
Puerto Rico Industrial Tourist Educational
Medical & Environmental Control Facilities
(Mennonite General Hospital) Series A
5.625% 7/1/27 .................................... $140,000 $ 108,867
----------
2,115,986
----------
Housing Revenue Bonds - 10.79%
Dade County Housing Finance Authority
(Lincoln Fields Apartments Section 8)
6.25% 7/1/24 (FHA/MBIA) .......................... 500,000 502,575
Duval Housing Finance Authority
(St. Augustine Apartments)
6.00% 3/1/21 ..................................... 300,000 293,694
Florida Housing Finance Agency
(Homeowner Mortgage) Series 1B
6.00% 7/1/17 (FHA/VA) ............................ 175,000 174,610
Florida Housing Finance Agency
(The Vineyards Project) Series H
6.40% 11/1/15 .................................... 500,000 501,745
----------
1,472,624
----------
Lease/Certificates of Participation - 2.62%
Florida St. University Systems Certificates of
Participation 5.00% 05/01/18 ..................... 400,000 357,380
----------
357,380
----------
*Pre-Refunded/Escrowed to Maturity Bonds - 5.38%
Miramar Wastewater Improvement
6.75% 10/1/25-04 (FGIC) .......................... 100,000 108,343
Palm Beach County Health Facilities Authority
(Good Samaritan Health System)
6.30% 10/1/22-05 ................................. 130,000 138,197
St. Lucie County (Special Assessment-South
Hutchinson Island)
6.10% 11/1/20-05 (AG) ............................ 150,000 159,998
Volusia, Florida Industrial Development
Authority (Bishops Glen Project Retirement
Health Facilities) 7.50% 11/1/16-06 .............. 300,000 327,753
----------
734,291
----------
Recreational Facility Revenue Bonds - 5.59%
Village Center Community Development
District (Florida Recreational Revenue)
Series A 5.50% 11/1/10 (MBIA) .................... 750,000 763,260
----------
763,260
----------
Utility Revenue Bonds - 16.07%
Puerto Rico Electric Power Authority
Series X 5.50% 7/1/25 ............................ 150,000 139,547
Tampa, Florida Utility Improvement
6.00% 10/1/17 .................................... 1,000,000 1,023,530
Tampa, Florida Utility Tax 6.125% 10/1/18 .......... 1,000,000 1,029,359
----------
2,192,436
----------
9
<PAGE>
Statements of Net Assets (continued)
Principal Market
Delaware Tax-Free Florida Fund Amount Value
- --------------------------------------------------------------------------------
Municipal Bonds (continued)
Waste Disposal Revenue Bonds - 1.05%
Jacksonville Sewer & Solid Waste Disposal
Facilities Authority (Anheuser Busch
Project) 5.875% 2/1/36 (AMT) ..................... $ 150,000 $ 143,006
----------
143,006
----------
Water & Sewer Revenue Bonds - 5.69%
Jacksonville Electric Authority Revenue
Water & Sewer Systems Series A
5.625% 10/1/37 ................................... 500,000 464,420
Northern Palm Beach County Improvement
District (Special Assessment-Abacoa
Water Control) 7.20% 8/1/16 (FGIC) ............... 300,000 311,649
----------
776,069
----------
Other Revenue Bonds - 23.23%
Brevard County Constitutional Fuel Tax
Revenue 6.00% 8/1/14 ............................. 1,000,000 1,036,749
Dade County Special Obligation Series B
5.00% 10/1/35 (AMBAC) ............................ 200,000 167,174
Florida State Board of Education (Lottery
Revenue) 6.00% 7/1/14 ............................ 1,000,000 1,034,819
Lake Bernadette Community Development
District (Special Assessment) Series A
8.00% 5/1/17 ..................................... 250,000 251,520
Orlando, Florida (Special Assessment-Conroy
Road Interchange) Series B
5.25% 5/1/05 ..................................... 450,000 430,749
Tampa Palms Community Development
District (Richmond Place Project)
7.50% 5/1/18 ..................................... 245,000 248,388
----------
.................................................... 3,169,399
----------
Total Municipal Bonds
(cost $14,113,216) ............................... 13,805,716
----------
Total Market Value of Securities - 101.18%
(cost $14,113,216) .............................. $13,805,716
Receivables and Other Assets
Net of Liabilities - (1.18)% ..................... (161,394)
----------
Net Assets Applicable to 1,360,241 Shares
Outstanding - 100% ............................... $13,644,322
===========
Net Asset Value - Delaware Tax-Free Florida Fund A Class
($9,339,743 / 931,504 Shares) .................... $10.03
------
Net Asset Value - Delaware Tax-Free Florida Fund B Class
($3,969,875 / 395,372 Shares ) ................... $10.04
------
Net Asset Value - Delaware Tax-Free Florida Fund C Class
($334,704 / 33,365 Shares ) ...................... $10.03
------
- -----------------------
*For Pre-Refunded Bonds, the stated maturity is followed by the year in which
each bond is pre-refunded.
<PAGE>
- --------------------------------------------------------------------------------
Summary of Abbreviations:
AG - Insured by Asset Guaranty
AMBAC - Insured by the AMBAC Indemnity Corporation
AMT - Subject to Federal Alternative Minimum Tax
FGIC - Insured by the Financial Guaranty Insurance Company
FHA - Insured by the Federal Housing Authority
FSA - Insured by Financial Security Assurance
LOC - Letter Of Credit
MBIA - Insured by the Municipal Bond Insurance Association
VA - Insured by the Veterans Administration
Components of Net Assets at February 29, 2000:
Shares of beneficial interest (unlimited authorization -
no par) .......................................... $14,768,316
Undistributed net investment income ................. 319
Accumulated net realized loss on
investments ...................................... (816,813)
Net unrealized depreciation of investments .......... (307,500)
----------
Total net assets .................................... $13,644,322
===========
Net Asset Value and Offering Price Per Share -
Delaware Tax-Free Florida Fund
Net asset value A Class (A) ......................... $10.03
Sales charge (3.75% of offering price or 3.89%
of amount invested per share) (B) ................ 0.39
------
Offering price ...................................... $10.42
======
- --------------------------
(A) Net asset value per share illustrated is the estimated amount which would be
paid upon the redemption or repurchase of shares.
(B) See the current prospectus for purchases of $100,000 or more.
See accompanying notes
10
<PAGE>
Statements of Net Assets (continued)
DELAWARE TAX-FREE FLORIDA INSURED FUND
- --------------------------------------
Principal Market
February 29, 2000 (Unaudited) Amount Value
- --------------------------------------------------------------------------------
Municipal Bonds - 98.52%
General Obligation Bonds - 7.14%
Florida State Board of Education Capital
Outlay Public Education-Series B
4.50% 6/1/28 (MBIA) ............................. $11,000,000 $ 8,520,599
-----------
8,520,599
-----------
Higher Education Revenue Bonds - 7.62%
Miami-Dade County Florida Educational
Facilities Authority University of Miami,
Series A 5.50% 4/1/19 (AMBAC) ................... 1,400,000 1,334,774
Miami-Dade County Florida Educational
Facilities Authority University of Miami,
Series A 5.75% 4/1/29 (AMBAC) ................... 8,000,000 7,768,800
-----------
9,103,574
-----------
Hospital Revenue Bonds - 16.33%
Hillsborough County-Tampa General
Hospital 6.375% 10/1/13 (FSA) .................. 3,600,000 3,746,412
Indian River County Hospital District
6.10% 10/1/18 (FSA) ............................. 3,000,000 3,049,860
Lee County Hospital Board (Lee Memorial
Hospital) 6.35% 3/26/20 (MBIA) .................. 10,000,000 10,184,400
Tallahassee Health Facilities (Tallahassee
Memorial Regional Medical Center)
Series B 6.00% 12/1/15 (MBIA) ................... 2,500,000 2,524,325
-----------
19,504,997
-----------
Housing Revenue Bonds - 23.98%
Florida State Housing Finance Agency
Crossings Indian Run Apartments HUD
Series V (LOC First Union National Bank
of North Carolina) 6.10% 12/1/26
(AMT) (AMBAC) ................................... 750,000 751,425
Florida State Housing Finance Agency
Crossings Indian Run Apartments HUD
Series V (LOC First Union National Bank
of North Carolina) 6.20% 12/1/36
(AMT) (AMBAC) ................................... 1,790,000 1,799,380
Florida State Housing Finance Agency
Landings at Sea Forest Apartments
FHA Series T (LOC First Union National
Bank of North Carolina) 5.85% 12/1/18
(AMT) (AMBAC) ................................... 490,000 482,826
Florida State Housing Finance Agency
Landings At Sea Forest Apartments
FHA Series T (LOC First Union National
Bank of North Carolina) 6.05% 12/1/36
(AMT) (AMBAC) ................................... 700,000 696,850
Florida State Housing Finance Agency
Leigh Meadows Apartments Section 8
Series N (LOC First Union National
Bank of North Carolina) 6.20% 9/1/26
(AMT) (AMBAC) ................................... 2,765,000 2,783,111
<PAGE>
Principal Market
Amount Value
- --------------------------------------------------------------------------------
Municipal Bonds (continued)
Housing Revenue Bonds (continued)
Florida State Housing Finance
Agency Leigh Meadows Apartments
Section 8 Series N (LOC First Union
National Bank of North Carolina)
6.30% 9/1/36 (AMT) (AMBAC) ........................ $2,000,000 $ 2,016,980
Florida State Housing Finance Agency
Mariner Club Apartments -
Series K-1 6.25% 9/1/26
(AMT) (AMBAC) ..................................... 2,000,000 2,026,260
Florida State Housing Finance Agency
Mariner Club Apartments
Series K-1 6.375% 9/1/36
(AMT) (AMBAC) ..................................... 3,500,000 3,560,725
Florida State Housing Finance Agency
Riverfront Apartments Section 8
Series A 6.25% 4/1/37
(AMT) (AMBAC) ..................................... 1,000,000 987,140
Florida State Housing Finance Agency
Spinnaker Cove Apartments Series G
(LOC First Union National Bank of
North Carolina) 6.50% 7/1/36
(AMT) (AMBAC) ..................................... 500,000 512,200
Florida State Housing Finance Agency
Sterling Palms Apartments Series D-1
(LOC First Union National Bank of
North Carolina) 6.30% 12/1/16
(AMT) (AMBAC) ..................................... 1,000,000 1,023,810
Florida State Housing Finance Agency
Sterling Palms Apartments Series D-1
(LOC First Union National Bank of
North Carolina) 6.40% 12/1/26
(AMT) (AMBAC) ..................................... 1,500,000 1,527,675
Florida State Housing Finance Agency
Sterling Palms Apartments Series D-1
(LOC First Union National Bank of
North Carolina) 6.50% 6/1/36
(AMT) (AMBAC) ..................................... 6,540,000 6,685,515
Florida State Housing Finance Agency
Woodbridge Apartments Series L
(LOC First Union National National
Bank of North Carolina)
6.15% 12/1/26 (AMT) (AMBAC) ....................... 1,750,000 1,756,843
Florida State Housing Finance Agency
Woodbridge Apartments Series L
(LOC First Union National Bank of
North Carolina) 6.25% 6/1/36
(AMT) (AMBAC) ..................................... 2,000,000 2,017,180
-----------
28,627,920
-----------
11
<PAGE>
Statements of Net Assets (continued)
Principal Market
Delaware Tax-Free Florida Insured Fund Amount Value
- --------------------------------------------------------------------------------
Municipal Bonds (continued)
Industrial Development Revenue Bonds - 0.86%
Canaveral Port Authority
6.00% 6/1/12 (FGIC) ............................... $1,000,000 $ 1,031,560
-----------
1,031,560
-----------
*Pre-Refunded Bonds - 13.38%
Florida State Turnpike Authority
6.30% 7/1/12-02 (FGIC) ............................ 2,000,000 2,087,120
Miramar Wastewater Improvement
6.75% 10/1/25-04 (FGIC) ........................... 2,425,000 2,627,318
North Port Utilities System 6.15%
10/1/09-02 (FGIC) ................................. 1,500,000 1,578,390
Palm Beach Solid Waste Authority
6.00% 12/1/07-02 (MBIA) ........................... 1,000,000 1,050,360
Palm Beach Solid Waste Authority
6.25% 12/1/08-02 (MBIA) ........................... 2,000,000 2,113,460
Pembroke Pines Capital Improvement
5.95% 10/1/20-04 (AMBAC) .......................... 1,225,000 1,297,263
Port St. Lucie Utility System
6.00% 9/1/24-04 (FGIC) ............................ 5,000,000 5,221,500
-----------
15,975,411
-----------
Sales Tax Revenue Bonds - 6.82%
Bay City, Florida Sales Tax Revenue
4.75% 9/1/23 (FSA) ................................ 5,500,000 4,562,030
Jupiter Sales Tax 6.375% 9/1/20
(AMBAC) ........................................... 2,500,000 2,540,925
Marion County Public Improvement
Sales Tax 6.125% 12/1/08 (MBIA) ................... 1,000,000 1,040,240
-----------
8,143,195
-----------
Special Utility Bonds - 0.86%
New Smyrna Beach Utilities Commission
6.00% 10/1/13 (FGIC) .............................. 1,000,000 1,021,560
-----------
1,021,560
-----------
Turnpike/Toll Roads Revenue - 2.62%
Miami Dade County Expressway Authority
Toll System 6.375% 7/1/29 (FGIC) .................. 3,000,000 3,123,780
-----------
3,123,780
-----------
Water & Sewer Revenue Bonds - 2.60%
Coral Springs Water & Sewer Series A
6.00% 9/1/10 (FGIC) ............................... 1,000,000 1,034,520
Jupiter Water Series A
6.25% 10/1/12 (AMBAC) ............................. 2,000,000 2,075,620
-----------
3,110,140
-----------
<PAGE>
Principal Market
Amount Value
- --------------------------------------------------------------------------------
Municipal Bonds (continued)
Other Revenue Bonds - 16.31%
Florida State Division Board of
Finance Department of General
Services Department of Environmental
Resources Preservation 2000 Series A
5.75% 7/1/13 (AMBAC) .............................. $5,000,000 $ 5,073,600
Nassau County Optional Gas Tax-Fuel
Sales Tax 6.00% 3/1/09 (FGIC) ..................... 1,000,000 1,031,790
Ocala Optional Gas Tax-Fuel Sales Tax
6.00% 12/1/09 (AMBAC) ............................. 1,000,000 1,036,990
Ocoee Florida Revenue Refunding &
Improvement Transportation
4.50% 10/1/23 (MBIA) .............................. 1,000,000 794,330
Ocoee Florida Revenue Refunding &
Improvement Transportation
4.50% 10/1/28 (MBIA) .............................. 1,000,000 772,620
Orange County, Florida Tourist Revenue
4.75% 10/1/20 ..................................... 1,000,000 842,600
Osceola County Celebration Community
Development District Assessment
6.10% 5/1/16 (MBIA) ............................... 695,000 707,218
Osceola County Enterprise Community
Development District - Special
Assessment 6.10% 5/1/16 (MBIA) .................... 1,000,000 1,017,580
Palm Beach County, Florida Criminal
Facility Revenue 5.75%
6/1/12 (FGIC) ..................................... 195,000 201,392
Palm Beach County, Florida Criminal
Justice Facilities Revenue Residual
Certificates - Series 191
7.27% 6/1/12 ...................................... 7,500,000 7,991,700
------------
19,469,820
------------
Total Municipal Bonds
(cost $118,547,687) ................................ 117,632,556
------------
Total Market Value of Securities - 98.52%
(cost $118,547,687) ................................ $117,632,556
------------
Receivables and Other Assets
Net of Liabilities - 1.48% ........................ 1,770,561
------------
Net Assets Applicable to 11,462,565 Shares
Outstanding - 100.00% ............................. $119,403,117
============
12
<PAGE>
Statements of Net Assets (continued)
Delaware Tax-Free Florida Insured Fund
- --------------------------------------------------------------------------------
Net Asset Value - Delaware Tax-Free
Florida Insured Fund A Class
($114,352,993 / 10,977,849 shares) ................... $10.42
------
Net Asset Value - Delaware Tax-Free
Florida Insured Fund B Class
($4,944,648 / 474,600 shares) ........................ $10.42
------
Net Asset Value - Delaware Tax-Free
Florida Insured Fund C Class
($105,476 / 10,116 shares) ........................... $10.43
------
- ----------------
*For Pre-Refunded Bonds, the stated maturity is followed by the year in which
each bond is pre-refunded.
- ----------------
Summary of Abbreviations:
AMBAC - Insured by the AMBAC Indemnity Corporation
AMT - Subject to Federal Alternative Minimum Tax
FGIC - Insured by the Financial Guaranty Insurance Company
FSA - Insured by Financial Security Assurance
MBIA - Insured by the Municipal Bond Insurance Association
LOC - Letter of Credit
<PAGE>
Components of Net Assets at February 29, 2000:
Shares of beneficial interest (unlimited
authorization - no par) .................................... $127,344,856
Undistributed net investment loss ............................ (11,517)
Accumulated net realized loss
on investments ............................................. (7,015,091)
Net unrealized depreciation
of investments ............................................. (915,131)
------------
Total net assets ............................................. $119,403,117
============
Net Asset Value and Offering Price Per Share -
Delaware Tax-Free Florida Insured Fund
Net asset value A Class (A) .................................. $10.42
Sales charge (3.75% of offering price or
3.93% of amount invested per
share) (B) ................................................. 0.41
------
Offering price ............................................... $10.83
------
- -----------------
(A) Net asset value per share, as illustrated, is the estimated amount which
would be paid upon the redemption or repurchase of shares.
(B) See the current prospectus for purchases of $100,000 or more.
See accompanying notes
13
<PAGE>
Statements of Net Assets (continued)
DELAWARE TAX-FREE NEW YORK FUND
- -------------------------------
Principal Market
February 29, 2000 (Unaudited) Amount Value
- --------------------------------------------------------------------------------
Municipal Bonds - 94.76%
City Agencies Revenue Bonds - 4.55%
New York City Transitional Finance Authority
Revenue 6.125% 11/15/15 ......................... $ 500,000 $ 517,115
----------
517,115
----------
General Obligation Bonds - 3.50%
New York City Series C
5.375% 11/15/27 ................................. 450,000 398,412
----------
398,412
----------
Higher Education Revenue Bonds - 16.62%
Albany, New York Industrial Development
Agency (Sage Colleges Project) Series A
5.30% 4/1/29 .................................... 500,000 420,895
New York State Dormitory Authority Revenue
(Chapel Oaks) 5.45% 7/1/26 (LOC Allied
Irish Bank) ..................................... 450,000 397,958
New York State Dormitory Authority Revenue
(Pratt Institute) 6.00% 7/1/20 (AG) ............. 500,000 495,320
New York State Dormitory Authority
Revenue (Pooled Capital Program)
7.80% 12/1/05 (FGIC) ............................ 121,000 121,819
New York State Dormitory Authority
Revenue (State University Educational
Facilities) 7.50% 5/15/11 ....................... 400,000 454,060
----------
1,890,052
----------
Hospital Revenue Bonds - 7.00%
New York State Dormitory Authority
Revenue (Mental Health)
5.90% 2/15/12 ................................... 250,000 254,335
New York State Dormitory Authority
Revenue (Millard Fillmore Hospital)
5.375% 2/1/32 (AMBAC) ........................... 450,000 399,762
New York State Medical Care Facility
Finance Agency Revenue (Mental Health)
7.70% 2/15/18 ................................... 140,000 141,658
----------
795,755
----------
Housing Revenue Bonds - 8.70%
New York State Mortgage Agency Revenue
(Homeowner Mortgage)
6.25% 4/1/30 (AMT) .............................. 1,000,000 989,240
----------
989,240
----------
Industrial Development Revenue Bonds - 10.01%
New York City Industrial Development
Agency (Brooklyn Navy Yard Cogen
Partners) 5.75% 10/1/36 (AMT) ................... 450,000 383,310
New York City Industrial Development
Agency (British Airways)
5.25% 12/1/32 (AMT) ............................. 600,000 491,850
<PAGE>
Municipal Bonds (continued)
Industrial Development Revenue Bonds (continued)
Oneida County, New York Industrial
Development Agency Revenue
(Mohawk Valley Handicapped)
5.35% 3/15/29 (ACA) ............................ $ 300,000 $ 262,944
----------
1,138,104
----------
*Pre-Refunded/Escrowed to Maturity Bonds - 24.25%
New York City General Obligation Series F
8.25% 11/15/17-01 ............................... 690,000 740,591
New York State (Local Government
Assistance Corporation) Series B
7.50% 4/1/20-01 ................................. 600,000 632,292
New York State Thruway Authority Service
Contract Revenue (Local Highway &
Bridge) 6.25% 4/1/14-05 ......................... 500,000 535,250
New York State Urban Development
Corporation Revenue (Correctional
Facilities) 7.375% 1/1/18-02 .................... 600,000 639,312
United Nations Development Corporation
Senior Lien Series A 6.00% 7/1/12-03 ............ 200,000 211,018
----------
2,758,463
----------
Territorial Revenue Bonds - 3.80%
Puerto Rico Commonwealth Highway &
Transportation Authority (Highway
Revenue) Series Y 5.50% 7/1/36 .................. 475,000 432,858
-----------
432,858
-----------
Transportation Revenue Bonds - 12.58%
Metropolitan Transportation Authority
New York Series A 6.125% 4/1/17 ................. 1,000,000 1,026,789
Metropolitan Transportation Authority New
York Service Contract (Commuter
Facilities) Series 0 5.75% 7/1/13 ............... 400,000 403,676
-----------
1,430,465
-----------
Water & Sewer Revenue Bonds - 3.75%
New York City Water Finance Series 97B
5.75% 6/15/29 ................................... 450,000 426,816
-----------
426,816
-----------
Total Municipal Bonds
(cost $10,983,143) .............................. 10,777,280
-----------
14
<PAGE>
Statements of Net Assets (continued)
Number of Market
Delaware Tax-Free New York Fund Shares Value
- --------------------------------------------------------------------------------
Short-Term Investments - 3.83%
Wells Fargo National Tax-Free
Money Market Fund ............................... $435,237 $ 435,237
-----------
Total Short-Term Investments
(cost $435,237) ................................. 435,237
-----------
Total Market Value of Securities - 98.59%
(cost $11,418,380) ............................. $11,212,517
Receivables and Other Assets
Net of Liabilities - 1.41% ...................... 160,824
-----------
Net Assets Applicable to 1,202,440
Shares Outstanding - 100% ....................... $11,373,341
===========
Net Asset Value - Delaware Tax-Free
New York Fund A Class
($9,967,142 / 1,053,534 Shares) ................. $9.46
-----
Net Asset Value - Delaware Tax-Free
New York Fund B Class
($1,314,687 / 139,210 Shares) ................... $9.44
-----
Net Asset Value - Delaware Tax-Free
New York Fund C Class
($91,512 / 9,696 Shares) ........................ $9.44
-----
- ------------
*For Pre-Refunded Bonds, the stated maturity is followed by the year in which
each bond is pre-refunded.
------------
Summary of Abbreviations:
ACA - American Capital Access
AG - Asset Guaranty
AMBAC - Insured by the AMBAC Indemnity Corporation
AMT - Subject to Federal Alternative Minimum Tax
FGIC - Insured by the Financial Guaranty Insurance Company
OC - Letter of Credit
<PAGE>
Components of Net Assets at February 29, 2000:
Shares of beneficial interest (unlimited
authorization - no par) ......................... $12,097,245
Distributions in excess of net investment
income .......................................... (291)
Accumulated net realized loss
on investments .................................. (517,750)
Net unrealized depreciation
of investments .................................. (205,863)
-----------
Total Net Assets .................................. $11,373,341
===========
Net Asset Value and Offering Price Per Share -
Delaware Tax-Free New York Fund
Net asset value A Class (A) ....................... $9.46
Sales charge (3.75% of offering price
or 3.91% of amount invested per
share) (B) ...................................... 0.37
-----
Offering price .................................... $9.83
=====
- ---------------------------------------
(A) Net asset value per share illustrated is the estimated amount which would
be paid upon the redemption or repurchase of shares.
(B) See the current prospectus for purchases of $100,000 or more.
See accompanying notes
15
<PAGE>
Statements of Operations
<TABLE>
<CAPTION>
Delaware Delaware Delaware
Tax-Free Tax-Free Florida Tax-Free
Six Months Ended February 29, 2000 (Unaudited) Florida Fund Insured Fund New York Fund
- ------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Investment Income:
Interest ........................................................ $ 443,802 $ 3,669,850 $ 350,614
------------------------------------------
Expenses:
Management fees ................................................. 42,474 310,358 32,500
Distribution expense ............................................ 36,928 174,134 20,139
Dividend disbursing and transfer agent fees and expenses ........ 8,100 2,130 9,600
Registration fees ............................................... 1,200 - 4,800
Reports and statements to shareholders .......................... 6,000 24,110 2,700
Accounting and administration ................................... 3,600 39,222 2,700
Custodian fees .................................................. 1,200 1,100 930
Professional fees ............................................... 6,540 25,831 1,800
Taxes (other than taxes on income) .............................. 630 - 1,000
Trustee's fees .................................................. 840 - 1,350
Other ........................................................... 197 1,434 1,109
------------------------------------------
107,709 578,319 78,628
Less expenses absorbed or waived ................................ (32,177) (1,120) (43,782)
Less expenses paid indirectly ................................... (176) (1,434) (134)
------------------------------------------
Total operating expenses ........................................ 75,356 575,765 34,712
------------------------------------------
Interest expense ................................................ - 1,674 153
------------------------------------------
Total expenses .................................................. 75,356 577,439 34,865
------------------------------------------
Net Investment Income ........................................... 368,446 3,092,411 315,749
------------------------------------------
Net Realized and Unrealized Loss on Investments:
Net realized loss on investment transactions .................... (691,559) (937,183) (497,021)
Net change in unrealized appreciation/depreciation of investments (75,355) (3,051,171) (16,798)
------------------------------------------
Net Realized and Unrealized Loss on Investments ................. (766,914) (3,988,354) (513,819)
------------------------------------------
Net Decrease in Net Assets Resulting
from Operations ................................................ $(398,468) $ (895,943) $(198,070)
==========================================
</TABLE>
See accompanying notes
16
<PAGE>
Statements of Changes in Net Assets
<TABLE>
<CAPTION>
Delaware Delaware Delaware
Tax-Free Tax-Free Florida Tax-Free
Florida Fund Insured Fund New York Fund
- ------------------------------------------------------------------------------------------------------------------------------------
Six Months Year Six Month Year Six Months Year
Ended Ended Ended Ended Ended Ended
2/29/00 8/31/99 2/29/00 8/31/99 2/29/00 8/31/99
(Unaudited) (Unaudited) (Unaudited)
<S> <C> <C> <C> <C> <C> <C>
Decrease in Net Assets from Operations:
Net investment income ............................. $368,446 $750,679 $3,092,411 $6,829,844 $315,749 $587,627
Net realized gain (loss) on investments ........... (691,559) (123,698) (937,183) 3,752,953 (497,021) (11,244)
Net change in unrealized appreciation/depreciation
of investments .................................. (75,355) (972,725) (3,051,171) (11,471,230) (16,798) (924,826)
-------------------------------------------------------------------------------
Net decrease in net assets resulting from
operations ...................................... (398,468) (345,744) (895,943) (888,433) (198,070) (348,443)
-------------------------------------------------------------------------------
Distributions to Shareholders from:
Net investment income:
A Class ......................................... (267,340) (549,061) (2,998,825) (6,646,531) (280,444) (538,857)
B Class ......................................... (90,219) (172,634) (102,901) (181,234) (33,042) (44,901)
C Class ......................................... (10,568) (28,984) (2,202) (2,079) (2,388) (3,869)
Net realized gain on investments:
A Class ......................................... -- (11,362) -- -- (166) (24,643)
B Class ......................................... -- (4,026) -- -- -- (1,574)
C Class ......................................... -- (621) -- -- -- (176)
-------------------------------------------------------------------------------
(368,127) (766,688) (3,103,928) (6,829,844) (316,040) (614,020)
-------------------------------------------------------------------------------
Capital Share Transactions:
Proceeds from shares sold:
A Class ......................................... 715,640 4,574,720 1,557,499 4,395,898 286,454 2,613,937
B Class ......................................... 860,681 2,352,953 609,890 1,543,291 286,734 1,443,259
C Class ......................................... 42,000 504,377 2 109,981 2 59,191
Net asset value of shares issued upon
reinvestment of distributions from net
investment income and net realized gain on
investments:
A Class ......................................... 126,492 260,924 916,518 1,978,302 196,470 428,293
B Class ......................................... 33,404 61,646 38,072 69,064 22,655 32,257
C Class ......................................... 3,262 11,255 2,258 1,971 2,417 3,986
-------------------------------------------------------------------------------
1,781,479 7,765,875 3,124,239 8,098,507 794,732 4,580,923
-------------------------------------------------------------------------------
Cost of shares repurchased:
A Class ......................................... (2,378,493) (2,654,355) (10,115,712) (19,743,806) (645,387) (1,595,227)
B Class ......................................... (1,181,430) (1,015,161) (348,702) (754,885) (370,574) (400,648)
C Class ......................................... (406,618) (298,373) -- -- (18,938) --
-------------------------------------------------------------------------------
(3,966,541) (3,967,889) (10,464,414) (20,498,691) (1,034,899) (1,995,875)
-------------------------------------------------------------------------------
Increase (decrease) in net assets derived from
capital share transactions ...................... (2,185,062) 3,797,986 (7,340,175) (12,400,184) (240,167) 2,585,048
-------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets: ............ (2,951,657) 2,685,554 (11,340,046) (20,118,461) (754,277) 1,622,585
Net Assets:
Beginning of period ............................... 16,595,979 13,910,425 130,743,163 150,861,624 12,127,618 10,505,033
-------------------------------------------------------------------------------
End of period ..................................... $13,644,322 $16,595,979 $119,403,117 $130,743,163 $11,373,341 $12,127,618
===============================================================================
</TABLE>
See accompanying notes
17
<PAGE>
Financial Highlights
<TABLE>
<CAPTION>
Selected data for each share of the Fund outstanding
throughout each period was as follows: Delaware Tax-Free Florida Fund A Class
- ------------------------------------------------------------------------------------------------------------------------------------
Six Months Year Eight Months Year Year Period
Ended Ended Ended Ended Ended 3/2/95(2) to
2/29/00(1) 8/31/99 8/31/98(1) 12/31/97(4) 12/31/96 12/31/95
(Unaudited)
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period .................... $10.530 $11.230 $11.020 $10.520 $10.730 $10.000
Income (loss) from investment operations:
Net investment income ................................. 0.256 0.492 0.374 0.591 0.590 0.470
Net realized and unrealized gain (loss) on investments. (0.500) (0.688) 0.215 0.523 (0.210) 0.750
------------------------------------------------------------------------
Total from investment operations ...................... (0.244) (0.196) 0.589 1.114 0.380 1.220
------------------------------------------------------------------------
Less dividends and distributions:
Dividends from net investment income .................. (0.256) (0.492) (0.374) (0.594) (0.590) (0.470)
Distributions from net realized gain on investments ... -- (0.012) (0.005) (0.020) -- (0.020)
------------------------------------------------------------------------
Total dividends and distributions ..................... (0.256) (0.504) (0.379) (0.614) (0.590) (0.490)
------------------------------------------------------------------------
Net asset value, end of period .......................... $10.030 $10.530 $11.230 $11.020 $10.520 $10.730
========================================================================
Total return(3) ......................................... (2.33%) (1.50%) 5.44% 10.93% 3.74% 12.49%
Ratios and supplemental data:
Net assets, end of period (000 omitted) ............... $ 9,340 $11,406 $9,988 $7,506 $5,76 $4,421
Ratio of expenses to average net assets ............... 0.75% 0.62% 0.55% 0.56% 0.33% 0.32%(5)
Ratio of expenses to average net assets prior to expense
limitation and expenses paid indirectly ............. 1.17% 1.16% 1.10% 1.11% 1.25% 1.25%(5)
Ratio of net investment income to average net assets .. 5.04% 4.81% 4.92% 5.53% 5.66% 5.26%(5)
Ratio of net investment income to average net assets prior
to expense limitation and expenses paid indirectly .. 4.62% 4.27% 4.37% 4.98% 4.74% 4.33%(5)
Portfolio turnover .................................... 39% 30% 20% 19% 70% 64%
</TABLE>
- --------------------------
(1) Ratios have been annualized and total return has not been annualized.
(2) Commencement of operations.
(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) Commencing May 1, 1997, Delaware Management Company replaced Voyageur Fund
Managers, Inc. as the Fund's investment manager.
(5) Annualized.
See accompanying notes
18
<PAGE>
Financial Highlights (continued)
<TABLE>
<CAPTION>
Selected data for each share of the Fund outstanding
throughout each period was as follows: Delaware Tax-Free Florida Fund B Class
- ------------------------------------------------------------------------------------------------------------------------------------
Six Months Year Eight Months Year Year Period
Ended Ended Ended Ended Ended 9/15/95(2) to
2/29/00(1) 8/31/99 8/31/98(1) 12/31/97(4) 12/31/96 12/31/95
(Unaudited)
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period .................... $10.540 $11.240 $11.030 $10.530 $10.730 $10.370
Income (loss) from investment operations:
Net investment income ................................. 0.217 0.449 0.318 0.527 0.560 0.150
Net realized and unrealized gain (loss) on investments. (0.500) (0.688) 0.215 0.531 (0.200) 0.380
-------------------------------------------------------------------------
Total from investment operations ...................... (0.283) (0.239) 0.533 1.058 0.360 0.530
-------------------------------------------------------------------------
Less dividends and distributions:
Dividends from net investment income .................. (0.217) (0.449) (0.318) (0.538) (0.560) (0.150)
Distributions from net realized gain on investments ... -- (0.012) (0.005) (0.020) -- (0.020)
-------------------------------------------------------------------------
Total dividends and distributions ..................... (0.217) (0.461) (0.323) (0.558) (0.560) (0.170)
-------------------------------------------------------------------------
Net asset value, end of period .......................... $10.040 $10.540 $11.240 $11.030 $10.530 $10.730
=========================================================================
Total return(3) ......................................... (2.69%) (2.24%) 4.91% 10.35% 3.51% 5.10%
Ratios and supplemental data:
Net assets, end of period (000 omitted) ............... $3,970 $4,468 $3,368 $2,685 $1,635 $101
Ratio of expenses to average net assets ............... 1.50% 1.37% 1.30% 1.10% 0.76% 0.44%(5)
Ratio of expenses to average net assets prior to expense
limitation and expenses paid indirectly ............. 1.92% 1.91% 1.85% 1.65% 2.00% 2.00%(5)
Ratio of net investment income to average net assets .. 4.29% 4.06% 4.17% 4.99% 5.23% 4.88%(5)
Ratio of net investment income to average net assets prior
to expense limitation and expenses paid indirectly .. 3.87% 3.52% 3.62% 4.44% 3.99% 3.32%(5)
Portfolio turnover .................................... 39% 30% 20% 19% 70% 64%
</TABLE>
- ----------------------
(1) Ratios have been annualized and total return has not been annualized.
(2) Commencement of operations.
(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) Commencing May 1, 1997, Delaware Management Company replaced Voyageur Fund
Managers, Inc. as the Fund's investment manager.
(5) Annualized.
See accompanying notes
19
<PAGE>
Financial Highlights (continued)
<TABLE>
<CAPTION>
Selected data for each share of the Fund outstanding
throughout each period was as follows: Delaware Tax-Free Florida Fund C Class
- ------------------------------------------------------------------------------------------------------------------------------------
Six Months Year Eight Months Year Year Period
Ended Ended Ended Ended Ended 4/22/95(2) to
2/29/00(1) 8/31/99 8/31/98(1) 12/31/97(4) 12/31/96 12/31/95
(Unaudited)
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period ................... $10.530 $11.240 $11.020 $10.520 $10.730 $10.200
Income (loss) from investment operations:
Net investment income ................................ 0.218 0.449 0.318 0.511 0.370 0.330
Net realized and unrealized gain (loss) on investments (0.500) (0.698) 0.225 0.521 (0.210) 0.560
-------------------------------------------------------------------------
Total from investment operations ..................... (0.282) (0.249) 0.543 1.032 0.160 0.890
-------------------------------------------------------------------------
Less dividends and distributions:
Dividends from net investment income ................. (0.218) (0.449) (0.318) (0.512) (0.370) (0.340)
Distributions from net realized gain on investments .. -- (0.012) (0.005) (0.020) -- (0.020)
-------------------------------------------------------------------------
Total dividends and distributions .................... (0.218) (0.461) (0.323) (0.532) (0.370) (0.360)
-------------------------------------------------------------------------
Net asset value, end of period ......................... $10.030 $10.530 $11.240 $11.020 $10.520 $10.730
=========================================================================
Total return(3) ........................................ (2.69%) (2.33%) 5.01% 10.09% 2.97% 8.88%
Ratios and supplemental data:
Net assets, end of period (000 omitted) .............. $335 $722 $554 $133 $16 $9
Ratio of expenses to average net assets .............. 1.50% 1.37% 1.30% 1.31% 1.15% 1.11%(5)
Ratio of expenses to average net assets prior to expense
limitation and expenses paid indirectly ............ 1.92% 1.91% 1.85% 1.86% 2.00% 2.00%(5)
Ratio of net investment income to average net assets.. 4.29% 4.06% 4.17% 4.78% 4.83% 4.57%(5)
Ratio of net investment income to average net assets prior
to expense limitation and expenses paid indirectly.. 3.87% 3.52% 3.62% 4.23% 3.98% 3.68%(5)
Portfolio turnover ................................... 39% 30% 20% 19% 70% 64%
</TABLE>
- ------------------------
(1) Ratios have been annualized and total return has not been annualized.
(2) Commencement of operations.
(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) Commencing May 1, 1997, Delaware Management Company replaced Voyageur Fund
Managers, Inc. as the Fund's investment manager.
(5) Annualized.
See accompanying notes
20
<PAGE>
Financial Highlights (continued)
<TABLE>
<CAPTION>
Selected data for each share of the Fund outstanding
throughout each period was as follows: Delaware Tax-Free Florida Insured Fund A Class
- -----------------------------------------------------------------------------------------------------------------------------------
Six Months Year Eight Months Year Year Year
Ended Ended Ended Ended Ended Ended
2/29/00(1) 8/31/99 8/31/98(1) 12/31/97(3) 12/31/96 12/31/95
(Unaudited)
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period ....................... $10.750 $11.370 $11.240 $10.710 $10.940 $9.520
Income (loss) from investment operations:
Net investment income .................................... 0.263 0.537 0.355 0.548 0.530 0.540
Net realized and unrealized gain (loss) on investments ... (0.329) (0.620) 0.130 0.536 (0.230) 1.440
---------------------------------------------------------------------
Total from investment operations ......................... (0.066) (0.083) 0.485 1.084 0.300 1.980
---------------------------------------------------------------------
Less dividends and distributions:
Dividends from net investment income ..................... (0.264) (0.537) (0.355) (0.554) (0.530) (0.560)
Distributions from net realized gain on investments ...... -- -- -- -- -- --
---------------------------------------------------------------------
Total dividends and distributions ........................ (0.264) (0.537) (0.355) (0.554) (0.530) (0.560)
---------------------------------------------------------------------
Net asset value, end of period ............................. $10.420 $10.750 $11.370 $11.240 $10.710 $10.940
=====================================================================
Total return(2) ............................................ (0.61%) (0.83%) 4.38% 10.42% 2.90% 21.22%
Ratios and supplemental data:
Net assets, end of period (000 omitted) .................. $114,353 $125,838 $146,660 $162,097 $192,171 $242,425
Ratio of expenses to average net assets .................. 0.90% 0.85% 0.87% 0.79% 0.73% 0.51%
Ratio of expenses to average net assets prior to expense
limitation and expenses paid indirectly ................ 0.90% 0.85% 1.05% 0.85% 0.96% 0.95%
Ratio of net investment income to average net assets ..... 5.00% 4.77% 4.72% 5.07% 5.02% 5.24%
Ratio of net investment income to average net assets prior
to expense limitation and expenses paid indirectly ..... 5.00% 4.77% 4.54% 5.01% 4.79% 4.80%
Portfolio turnover ....................................... 87% 25% 13% 15% 57% 101%
</TABLE>
- ----------------------
(1) Ratios have been annualized and total return has not been annualized.
(2) 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.
(3) Commencing May 1, 1997, Delaware Management Company replaced Voyageur Fund
Managers, Inc. as the Fund's investment manager.
See accompanying notes
21
<PAGE>
Financial Highlights (continued)
<TABLE>
<CAPTION>
Selected data for each share of the Fund outstanding
throughout each period was as follows: Delaware Tax-Free Florida Insured Fund B Class
- -----------------------------------------------------------------------------------------------------------------------------------
Six Months Year Eight Months Year Year Year
Ended Ended Ended Ended Ended Ended
2/29/00(1) 8/31/99 8/31/98(1) 12/31/97(3) 12/31/96 12/31/95
(Unaudited)
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period ...................... $10.750 $11.370 $11.230 $10.710 $10.940 $9.520
Income (loss) from investment operations:
Net investment income ................................... 0.225 0.452 0.299 0.477 0.480 0.500
Net realized and unrealized gain (loss)
on investments ........................................ (0.332) (0.620) 0.139 0.523 (0.230) 1.440
----------------------------------------------------------------------
Total from investment operations ........................ (0.107) (0.168) 0.438 1.000 0.250 1.940
----------------------------------------------------------------------
Less dividends and distributions:
Dividends from net investment income .................... (0.223) (0.452) (0.298) (0.480) (0.480) (0.520)
Distributions from net realized gain
on investments ........................................ -- -- -- -- -- --
----------------------------------------------------------------------
Total dividends and distributions ....................... (0.223) (0.452) (0.298) (0.480) (0.480) (0.520)
----------------------------------------------------------------------
Net asset value, end of period ............................ $10.420 $10.750 $11.370 $11.230 $10.710 $10.940
======================================================================
Total return(2) ........................................... (0.99%) (1.58%) 3.95% 9.58% 2.40% 20.76%
Ratios and supplemental data:
Net assets, end of period (000 omitted) ................. $4,945 $4,799 $4,202 $3,943 $3,222 $2,814
Ratio of expenses to average net assets ................. 1.65% 1.60% 1.62% 1.46% 1.24% 0.89%
Ratio of expenses to average net assets
prior to expense limitation and
expenses paid indirectly .............................. 1.65% 1.60% 1.80% 1.52% 1.72% 1.68%
Ratio of net investment income to average
net assets ............................................ 4.25% 4.02% 3.97% 4.40% 4.51% 4.80%
Ratio of net investment income to average
net assets prior to expense limitation
and expenses paid indirectly .......................... 4.25% 4.02% 3.79% 4.34% 4.03% 4.01%
Portfolio turnover ...................................... 87% 25% 13% 15% 57% 101%
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Delaware
Tax-Free Florida
Insured Fund C Class
- --------------------------------------------------------------------------------------------
Six Months 1/8/99(1,4)
Ended to
2/29/00(1) 8/31/99
(Unaudited)
<S> <C> <C>
Net asset value, beginning of period ...................... $10.760 $11.370
Income (loss) from investment operations:
Net investment income ................................... 0.226 0.286
Net realized and unrealized gain (loss)
on investments ........................................ (0.333) (0.610)
---------------------
Total from investment operations ........................ (0.107) (0.324)
---------------------
Less dividends and distributions:
Dividends from net investment income .................... (0.223) (0.286)
Distributions from net realized gain
on investments ........................................ -- --
---------------------
Total dividends and distributions ....................... (0.223) (0.286)
---------------------
Net asset value, end of period ............................ $10.430 $10.760
=====================
Total return(2) ........................................... (0.98%) (2.91%)
Ratios and supplemental data:
Net assets, end of period (000 omitted) ................. $105 $107
Ratio of expenses to average net assets ................. 1.65% 1.60%
Ratio of expenses to average net assets
prior to expense limitation and
expenses paid indirectly .............................. 1.65% 1.60%
Ratio of net investment income to average
net assets ............................................ 4.25% 4.02%
Ratio of net investment income to average
net assets prior to expense limitation
and expenses paid indirectly .......................... 4.25% 4.02%
Portfolio turnover ...................................... 87% 25%
</TABLE>
- ------------
(1) Ratios have been annualized and total return has not been annualized.
(2) 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.
(3) Commencing May 1, 1997, Delaware Management Company replaced Voyageur Fund
Managers, Inc. as the Fund's investment manager.
(4) For the period September 29,1997 (Commencement of Operations), through
December 18, 1997, Tax-Free Florida Insured Fund C Class sold shares which
were subsequently repurchased. There were no shares outstanding or
shareholder activity from December 19, 1997 through January 7, 1999. The
shareholder activity for the period September 29, 1997 through December 18,
1997 is not being disclosed in the Financial Highlights due to its
immateriality.
See accompanying notes
22
<PAGE>
Financial Highlights (continued)
<TABLE>
<CAPTION>
Selected data for each share of the Fund outstanding
throughout each period was as follows: Delaware Tax-Free New York Fund A Class
- -----------------------------------------------------------------------------------------------------------------------------------
Six Months Year Eight Months Year Three Months Year Year
Ended Ended Ended Ended Ended Ended Ended
2/29/00(1) 8/31/99 8/31/98(1) 8/31/97(4) 12/31/96(2) 9/30/96 9/30/95
(Unaudited)
<S> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period .......... $9.880 $10.670 $10.640 $10.690 $10.720 $10.870 $10.740
Income (loss) from investment operations:
Net investment income ....................... 0.263 0.523 0.362 0.603 0.120 0.550 0.570
Net realized and unrealized gain (loss)
on investments ............................ (0.420) (0.766) 0.040 0.128 0.010 (0.130) 0.170
----------------------------------------------------------------------------------
Total from investment operations ............ (0.157) (0.243) 0.402 0.731 0.130 0.420 0.740
----------------------------------------------------------------------------------
Less dividends and distributions:
Dividends from net investment income ........ (0.263) (0.523) (0.362) (0.606) (0.120) (0.550) (0.590)
Distributions from net realized gain
on investments ............................ -- (0.024) (0.010) (0.175) (0.040) (0.020) (0.020)
----------------------------------------------------------------------------------
Total dividends and distributions ........... (0.263) (0.547) (0.372) (0.781) (0.160) (0.570) (0.610)
----------------------------------------------------------------------------------
Net asset value, end of period ................ $9.460 $9.880 $10.670 $10.640 $10.690 $10.720 $10.870
==================================================================================
Total return(3) ............................... (1.57%) (2.44%) 3.85% 7.09% 1.21% 3.94% 7.31%
Ratios and supplemental data:
Net assets, end of period (000 omitted) ..... $9,967 $10,580 $9,978 $9,563 $10,044 $10,548 $11,931
Ratio of expenses to average net assets ..... 0.50% 0.66% 1.00% 1.00% 0.97%(5) 1.34% 1.31%
Ratio of expenses to average net assets
prior to expense limitation and expenses
paid indirectly ........................... 1.25% 1.19% 1.15% 1.39% 1.12%(5) 1.55% 1.82%
Ratio of net investment income to average
net assets ................................ 5.52% 4.99% 5.12% 5.66% 5.31%(5) 5.14% 5.66%
Ratio of net investment income to average
net assets prior
to expense limitation and expenses
paid indirectly ........................... 4.77% 4.46% 4.97% 5.27% 5.16%(5) 4.93% 5.15%
Portfolio turnover .......................... 27% 21% 21% 30% 5% 12% 10%
</TABLE>
- ---------------
(1) Ratios have been annualized and total return has not been annualized.
(2) Effective November 16, 1996, the Fund's shareholders approved a change of
investment advisor from Fortis Advisers, Inc. to Voyageur Fund Managers,
Inc.
(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) Commencing May 1, 1997, Delaware Management Company replaced Voyageur Fund
Managers, Inc. as the Fund's investment manager.
(5) Annualized.
See accompanying notes
23
<PAGE>
Financial Highlights (continued)
<TABLE>
<CAPTION>
Selected data for each share of the Fund outstanding
throughout each period was as follows: Delaware Tax-Free New York Fund B Class
- -----------------------------------------------------------------------------------------------------------------------------------
Six Months Year Eight Months Year Three Months Year Period
Ended Ended Ended Ended Ended Ended 11/14/94(6)
2/29/00(1) 8/31/99 8/31/98(1) 8/31/97(4) 12/31/96(2) 9/30/96 to 9/30/95
(Unaudited)
<S> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period ........ $9.860 $10.650 $10.610 $10.650 $10.690 $10.840 $10.340
Income (loss) from investment operations:
Net investment income ..................... 0.228 0.445 0.311 0.524 0.100 0.470 0.430
Net realized and unrealized gain (loss)
on investments .......................... (0.420) (0.766) 0.049 0.136 -- (0.130) 0.540
----------------------------------------------------------------------------------
Total from investment operations .......... (0.192) (0.321) 0.360 0.660 0.100 0.340 0.970
----------------------------------------------------------------------------------
Less dividends and distributions:
Dividends from net investment income ...... (0.228) (0.445) (0.310) (0.525) (0.100) (0.470) (0.450)
Distributions from net realized gain
on investments .......................... -- (0.024) (0.010) (0.175) (0.040) (0.020) (0.020)
----------------------------------------------------------------------------------
Total dividends and distributions ......... (0.228) (0.469) (0.320) (0.700) (0.140) (0.490) (0.470)
----------------------------------------------------------------------------------
Net asset value, end of period .............. $9.440 $9.860 $10.650 $10.610 $10.650 $10.690 $10.840
==================================================================================
Total return(3) ............................. (1.95%) (3.18%) 3.44% 6.39% 0.95% 3.14% 9.46%
Ratios and supplemental data:
Net assets, end of period (000 omitted) ... $1,315 $1,435 $469 $167 $254 $448 $266
Ratio of expenses to average net assets ... 1.25% 1.41% 1.75% 1.75% 1.87%(5) 2.09% 2.09%(5)
Ratio of expenses to average net assets
prior to expense limitation
and expenses paid indirectly ............ 2.00% 1.94% 1.90% 2.14% 2.00%(5) 2.30% 2.60%(5)
Ratio of net investment income to
average net assets ...................... 4.77% 4.24% 4.37% 4.91% 4.43%(5) 4.39% 4.68%(5)
Ratio of net investment income to average
net assets prior to expense
limitation and expenses
paid indirectly ......................... 4.02% 3.71% 4.22% 4.52% 4.30%(5) 4.18% 4.17%(5)
Portfolio turnover ........................ 27% 21% 21% 30% 5% 12% 10%
</TABLE>
- ---------------
(1) Ratios have been annualized and total return has not been annualized.
(2) Effective November 16, 1996, the Fund's shareholders approved a change of
investment advisor from Fortis Advisers, Inc. to Voyageur Fund Managers,
Inc.
(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) Commencing May 1, 1997, Delaware Management Company replaced Voyageur Fund
Managers, Inc. as the Fund's investment manager.
(5) Annualized.
(6) Commencement of operations
See accompanying notes
24
<PAGE>
Financial Highlights (continued)
<TABLE>
<CAPTION>
Selected data for each share of the Fund outstanding
throughout each period was as follows: Delaware Tax-Free New York Fund C Class
- -----------------------------------------------------------------------------------------------------------------------------------
Six Months Year Eight Months Year Three Months Year Period
Ended Ended Ended Ended Ended Ended 4/26/95(6)
2/29/00(1) 8/31/99 8/31/98(1) 8/31/97(4) 12/31/96(2) 9/30/96 to 9/30/95
(Unaudited)
<S> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period ......... $9.860 $10.640 $10.610 $10.660 $10.700 $10.850 $10.790
Income (loss) from investment operations:
Net investment income ........................ 0.228 0.445 0.308 0.522 0.100 0.470 0.210
Net realized and unrealized gain (loss)
on investments ............................. (0.420) (0.756) 0.042 0.128 -- (0.130) 0.060
----------------------------------------------------------------------------------
Total from investment operations ............. (0.192) (0.311) 0.350 0.650 0.100 0.340 0.270
----------------------------------------------------------------------------------
Less dividends and distributions:
Dividends from net investment income ......... (0.228) (0.445) (0.310) (0.525) (0.100) (0.470) (0.210)
Distributions from net realized gain
on investments ............................. -- (0.024) (0.010) (0.175) (0.040) (0.020) --
----------------------------------------------------------------------------------
Total dividends and distributions ............ (0.228) (0.469) (0.320) (0.700) (0.140) (0.490) (0.210)
----------------------------------------------------------------------------------
Net asset value, end of period ............... $9.440 $9.860 $10.640 $10.610 $10.660 $10.700 $10.850
==================================================================================
Total return(3) .............................. (1.95%) (3.08%) 3.35% 6.29% 0.95% 3.14% 2.54%
Ratios and supplemental data:
Net assets, end of period (000 omitted) ...... $92 $112 $58 $56 $53 $52 $51
Ratio of expenses to average net assets ...... 1.25% 1.41% 1.75% 1.75% 1.84%(5) 2.09% 2.09%(5)
Ratio of expenses to average net assets
prior to expense limitation and
expenses paid indirectly ................... 2.00% 1.94% 1.90% 2.14% 2.00%(5) 2.30% 2.60%(5)
Ratio of net investment income to
average net assets ......................... 4.77% 4.24% 4.37% 4.91% 4.45%(5) 4.39% 4.44%(5)
Ratio of net investment income to average
net assets prior to expense limitation
and expenses paid indirectly ............... 4.02% 3.71% 4.22% 4.52% 4.29%(5) 4.18% 3.93%(5)
Portfolio turnover ........................... 27% 21% 21% 30% 5% 12% 10%
</TABLE>
- -----------------
(1) Ratios have been annualized and total return has not been annualized.
(2) Effective November 16, 1996, the Fund's shareholders approved a change of
investment advisor from Fortis Advisers, Inc. to Voyageur Fund Managers,
Inc.
(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) Commencing May 1, 1997, Delaware Management Company replaced Voyageur Fund
Managers, Inc. as the Fund's investment manager.
(5) Annualized.
(6) Commencement of operations.
See accompanying notes
25
<PAGE>
Notes to Financial Statements
February 29, 2000 (Unaudited)
- --------------------------------------------------------------------------------
Delaware Tax-Free Florida Fund ("Tax-Free Florida Fund") and Delaware Tax-Free
Florida Insured Fund ("Tax-Free Florida Insured Fund"), series of the Voyageur
Investment Trust are registered as a Massachusetts Business Trusts under the
Investment Company Act of 1940 (as amended) as open-end management investment
companies. The Tax-Free Florida Fund is registered as a non-diversified fund.
The Tax-Free Florida Insured Fund is registered as a diversified fund. Delaware
Tax-Free New York Fund("Tax-Free New York Fund"), a series of Voyageur Mutual
Funds, is registered as a Delaware Business Trust under the Investment Company
Act of 1940 (as amended) as a non-diversified, open-end management investment
company.
Tax-Free Florida Fund, Tax-Free Florida Insured Fund and Tax-Free New York Fund
are each referred to as a "Fund" or collectively as the "Funds". The Tax-Free
Florida Fund seeks high current income free from both federal income taxes and
state intangibles tax by investing in investment grade municipal bonds. The
Tax-Free Florida Insured Fund seeks high current income free from both federal
income taxes and state intangibles tax with the added safety of an insured
portfolio by investing in insured municipal bonds. The Tax-Free New York Fund
seeks high current income free from both federal and state income taxes by
investing in investment grade municipal bonds. The Funds each offer three
classes of shares. The A Class carries a front-end sales charge of 3.75%. The B
Class carries a deferred sales charge and the C Class carries a level load
deferred sales charge.
1. 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 Funds Board
of Trustees.
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.
<PAGE>
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.
Other - Expenses common to all funds within the Delaware Investments Family of
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 and
market premiums are accreted to interest income over the lives of the respective
securities. The Funds declare dividends from net investment income daily and pay
them monthly. Capital gains, if any, are distributed annually.
Certain expenses of the Funds are paid through "soft dollar" arrangements with
brokers. These transactions are done subject to best price and execution. The
amount of these expenses for the six months ended February 29, 2000 were:
Tax-Free Tax-Free Tax-Free
Florida Fund Florida Insured Fund New York Fund
- ------------ -------------------- -------------
$176 $1,434 $134
The expenses paid under the above arrangements are included in their respective
expense captions on the Statements of Operations with the corresponding expense
offset shown as "Expenses paid indirectly".
2. Investment Management and Other Transactions with Affiliates
In accordance with the terms of the Investment Management Agreement, the Funds
pay Delaware Management Company ("DMC"), the Investment Manager of each Fund, an
annual fee, which is calculated daily on the net assets of each Fund.
Following are the management fees as a percentage of average daily net assets:
Tax-Free Tax-Free Florida Tax-Free
Florida Fund Insured Fund New York Fund
------------ ---------------- -------------
On the first
$500 million 0.55% 0.50% 0.55%
On the next
$500 million 0.50% 0.475% 0.50%
On the next
$1.5 billion 0.45% 0.45% 0.45%
In excess of
$2.5 billion 0.425% 0.425% 0.425%
26
<PAGE>
Notes to Financial Statements (continued)
- --------------------------------------------------------------------------------
DMC has elected to waive its fees and reimburse each Fund to the extent that
annual operating expenses, exclusive of taxes, interest, brokerage commissions,
distribution expenses and extraordinary expenses, exceed the following
percentages of average daily net assets through February 29, 2000:
Tax-Free Tax-Free Florida Tax-Free
Florida Fund Insured Fund New York Fund
------------ ---------------- -------------
Operating expense
limitation as a
percentage
of average daily
net assets
(per annum) 0.50% 0.65% 0.25%
The Funds have engaged Delaware Service Company, Inc. ("DSC"), an affiliate of
DMC, to provide dividend disbursing, transfer agent and accounting services.
Each Fund pays DSC a monthly fee based on the number of shareholder accounts,
shareholder transactions and average net assets, subject to certain minimums.
Pursuant to the Distribution Agreement, the Funds pay Delaware Distributors,
L.P. ("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 Fund.
On February 29, 2000, the Funds had payables to affiliates as follows:
Tax-Free Tax-Free Florida Tax-Free
Florida Fund Insured Fund New York Fund
------------ ---------------- -------------
Investment
Management
fees and other
expenses payable
to DMC $1,294 $47,252 $--
Dividend
disbursing,
transfer agent
fees, accounting
services and
other expenses
payable to DSC 1,675 15,248 1,684
Distribution fee and
other expenses
payable to DDLP 322 3,837 215
<PAGE>
For the six months ended February 29, 2000, DDLP earned commissions on sales of
the Fund A Class shares for each Fund as follows:
Tax-Free Tax-Free Tax-Free
Florida Fund Florida Insured Fund New York Fund
- ------------ -------------------- -------------
$653 $3,339 $40
Certain officers of DMC, DSC and DDLP are officers, trustees and/or employees of
the Funds. These officers, trustees and employees are paid no compensation by
the Funds.
3. Investments
During the six months ended February 29, 2000 the Funds 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 Florida Tax-Free
Florida Fund Insured Fund New York Fund
------------ ---------------- -------------
Purchases $5,759,905 $52,965,067 $3,028,340
Sales 7,284,698 60,334,221 3,417,282
At February 29, 2000 the aggregate cost of securities and unrealized
appreciation (depreciation) for federal income tax purposes for each Fund were
as follows:
Tax-Free Tax-Free Florida Tax-Free
Florida Fund Insured Fund New York Fund
------------ ---------------- -------------
Cost of
Investment $14,113,216 $118,547,687 $11,418,380
-------------------------------------------------------
Aggregate
unrealized
appreciation 154,397 2,249,826 289,349
-------------------------------------------------------
Aggregate unrealized
depreciation (461,897) (3,164,957) (495,212)
-------------------------------------------------------
Net unrealized
appreciation
(depreciation) $(307,500) $(915,131) $(205,863)
-------------------------------------------------------
For federal income tax purposes as of February 29, 2000, Tax-Free Florida had a
capital loss carryover of $17,781 that will expire in 2007, Tax-Free Florida
Insured Fund had a capital loss carryover of $5,342,463 that will expire in 2003
and $735,445 that will expire in 2004.
27
<PAGE>
Notes to Financial Statements (continued)
- --------------------------------------------------------------------------------
4. Capital Shares
Transactions in capital shares were as follows:
Tax-Free Florida Fund
-------------------------
Six Months Year
Ended Ended
2/29/00 8/31/99
(Unaudited)
Shares sold:
A Class .......................................... 70,401 411,029
B Class .......................................... 84,672 210,129
C Class .......................................... 4,145 45,217
Shares issued upon reinvestment of
distributions from net realized gain
on investments:
A Class .......................................... 12,419 23,627
B Class .......................................... 3,275 5,623
C Class .......................................... 319 1,021
------- -------
.......................................... 175,231 696,646
------- -------
Shares repurchased:
A Class .......................................... (234,972) (240,238)
B Class .......................................... (116,457) (91,522)
C Class .......................................... (39,648) (26,950)
.......................................... (391,077) (358,710)
------- -------
Net increase (decrease) ............................ (215,846) 337,936
======= =======
Tax-Free Florida Insured Fund
---------------------------------
Six Months Year
Ended Ended
2/29/00 8/31/99
(Unaudited)
Shares sold:
A Class .................................. 148,717 388,751
B Class .................................. 57,472 136,924
C Class .................................. -- 9,723
Shares issued upon reinvestment of
distributions from net realized gain
on investments:
A Class .................................. 87,257 175.844
B Class .................................. 3627 6.149
C Class .................................. 215 178
------- ---------
.................................. 297,288 717,569
------- ---------
Shares repurchased:
A Class .................................. (963,125) (1,755,957)
B Class .................................. (32,919) (66,242)
C Class .................................. -- --
.................................. (996,044) (1,822,199)
------- ---------
Net increase (decrease) .................. (698,756) (1,104,630)
======= =========
<PAGE>
Tax-Free New York Fund
-------------------------
Six Months Year
Ended Ended
2/29/00 8/31/99
(Unaudited)
Shares sold:
A Class .......................................... 30,135 247,644
B Class .......................................... 30,523 137,868
C Class .......................................... -- 5,576
Shares issued upon reinvestment of
distributions from net realized gain
on investments:
A Class .......................................... 20,559 40,908
B Class .......................................... 2,376 3,107
C Class .......................................... 253 383
------- -------
.......................................... 83,846 435,486
------- -------
Shares repurchased:
A Class .......................................... (67,923) (153,072)
B Class .......................................... (39,198) (39,547)
C Class .......................................... (1,960) --
------- -------
.......................................... (109,081) (192,619)
------- -------
Net increase (decrease) .......................... (25,235) 242,867
======= =======
5. Lines of Credit
Effective October 8, 1999, the Funds, along with certain other funds in the
Delaware Investments Family of Funds (the "Participants"), participate in a
$683,500,000 revolving line of credit facility to be used for temporary or
emergency purposes as an additional source of liquidity to fund redemptions of
investor shares. The Participants are charged an annual commitment fee, which is
allocated across the Participants on the basis of each Fund's allocation of the
entire facility. The Participants may borrow up to a maximum of one third of
their net assets under the agreement. Prior to October 8, 1999, the Delaware
Tax-Free Florida, Florida Insured, and New York Funds had committed lines of
credit of $500,000 $8,800,000 and $500,000, respectively. The Funds had no
amounts outstanding at February 29, 2000 or at any time during the fiscal year.
6. Credit and Market Risk
The Funds concentrate their investments in securities issued by municipalities,
mainly in Florida for Tax-Free Florida and Tax-Free Florida Insured Funds and in
New York for the Tax-Free New York Fund. The value of these investments may be
adversely affected by new legislation within the states, regional or 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 Statements of Net Assets.
28
<PAGE>
DELAWARE INVESTMENTS FAMILY OF FUNDS
Complete information on any fund offered by Delaware Investments can be found in
each fund's current prospectus. Prospectuses for all funds offered by Delaware
Investments are available from your financial adviser. Please read the
prospectus carefully before you invest or send money.
<TABLE>
<CAPTION>
<S> <C> <C>
Growth of Capital International and Global Tax-Exempt Income
o Technology and o Emerging Markets Fund o National High-Yield
Innovation Fund o New Pacific Fund Municipal Bond Fund
o Select Growth Fund o Overseas Equity Fund o Tax-Free USA Fund
o Trend Fund o International Equity Fund o Tax-Free Insured Fund
o Growth Opportunities o Global Equity Fund o Tax-Free USA
Fund* o Global Bond Fund Intermediate Fund
o Small Cap Value Fund o State Tax-Free Funds**
o U.S. Growth Fund Current Income
o Tax-Efficient Equity Fund o Delchester Fund Stability of Principal
o Social Awareness Fund o High-Yield o Cash Reserve
Opportunities Fund o Tax-Free Money Fund
Total Return o Strategic Income Fund
o Blue Chip Fund o Corporate Bond Fund Asset Allocation
o Devon Fund o Extended Duration o Foundation Funds
o Growth and Income Fund Bond Fund Growth Portfolio
o Decatur Equity o American Government Balanced Portfolio
Income Fund Bond Fund Income Portfolio
o REIT Fund o U.S. Government
o Balanced Fund Securities Fund
o Limited-Term
Government Fund
</TABLE>
* Formerly known as DelCap Fund.
** Available for the following states: Arizona, California, Colorado, Florida,
Idaho, Iowa, Kansas, Minnesota, Missouri, Montana, North Dakota, New Jersey,
New Mexico, New York, Oregon, Pennsylvania and Wisconsin. Insured and
intermediate bond funds are available in selected states.
(C)Delaware Distributors, L.P.
<PAGE>
DELAWARE(SM)
INVESTMENTS
- ---------------------
Philadelphia o London
For Shareholders
1.800.523.1918
For Securities Dealers
1.800.362.7500
For Financial Institutions
Representatives Only
1.800.659.2265
www.delawareinvestments.com
This semi-annual report is for the information of Delaware Tax-Free Florida
Fund, Delaware Tax-Free Florida Insured Fund and Delaware Tax-Free New York Fund
shareholders, but it may be used with prospective investors when preceded or
accompanied by a current Prospectus for the Delaware Tax-Free Florida Fund,
Delaware Tax-Free Florida Insured Fund and Delaware Tax-Free New York Fund Fund
and the Delaware Investments Performance Update for the most recently completed
calendar quarter. The prospectus sets forth details about charges, expenses,
investment objectives and operating policies of each Fund. You should read the
prospectus carefully before you invest. 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 each Fund will fluctuate so that shares,
when redeemed, may be worth more or less than their original cost.
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
BOARD OF TRUSTEES Charles E. Peck Investment Manager
Retired Delaware Management Company
Wayne A. Stork Fredericksburg, VA Philadelphia, PA
Chairman
Delaware Investments Family of Funds Janet L. Yeomans International Affiliate
Philadelphia, PA Vice President and Treasurer Delaware International Advisers Ltd.
3M Corporation London, England
Walter P. Babich St. Paul, MN
Board Chairman, National Distributor
Citadel Constructors, Inc. Delaware Distributors, L.P.
King of Prussia, PA AFFILIATED OFFICERS Philadelphia, PA
David K. Downes Charles E. Haldeman, Jr. Shareholder Servicing, Dividend
President and Chief Executive Officer President and Chief Executive Officer Disbursing and Transfer Agent
Delaware Investments Family of Funds Delaware Management Holdings, Inc. Delaware Service Company, Inc.
Philadelphia, PA Philadelphia, PA Philadelphia, PA
John H. Durham Richard J. Flannery 1818 Market Street
Private Investor Executive Vice President and Philadelphia, PA 19103-3682
Horsham, PA General Counsel
Delaware Investments Family of Funds
Anthony D. Knerr Philadelphia, PA
Consultant, Anthony Knerr & Associates
New York, NY Bruce D. Barton
President and Chief Executive Officer
Ann R. Leven Delaware Distributors, L.P.
Former Treasurer, National Gallery of Art Philadelphia, PA
Washington, DC
Thomas F. Madison
President and Chief Executive Officer
MLM Partners, Inc.
Minneapolis, MN
</TABLE>
(2901) Printed in the USA
SA-FLNY [2/00] PP 4/00 (J5749)
