<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 ANNUAL REPORT
[Tax-Exempt Income Artwork]
<PAGE>
TABLE OF CONTENTS
-----------------
Letter to Shareholders .................................................... 1
Portfolio Management
Review .................................................................... 3
Performance Summary ....................................................... 6
Financial Statements
Statements of Net Assets ................................................ 9
Statements of Operations ................................................ 15
Statements of Changes in
Net Assets .............................................................. 16
Financial Highlights .................................................... 17
Notes to Financial
Statements .............................................................. 25
Report of Independent
Auditors ................................................................ 29
A TRADITION OF SOUND INVESTING SINCE 1929
-----------------------------------------
A Commitment To Our Investors
Experienced
[] Our seasoned investment professionals average more than 15 years'
experience.
[] We began managing investments in 1929 and opened our first mutual fund in
1938. Over the past 70 years, we have weathered a full range of economic
and market environments.
Disciplined
[] We follow strict investment policies and clear buy/sell guidelines.
[] We strive to balance risk and reward in order to provide sound investment
alternatives within any given asset class.
Consistent
[] We clearly articulate our investment policies and follow them consistently.
[] Our commitment to consistency has earned us the confidence of
discriminating institutional and individual investors to manage more than
$44 billion in assets as of September 30, 2000.
Comprehensive
[] We offer more than 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 (23 single-state funds)
o International equity o International fixed-income
o Balanced
[] 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>
"WE BELIEVE RISING
TREASURY PRICES
LEFT MUNICIPAL BONDS
IN A POSITION OF
RELATIVE VALUE."
Dear Shareholder
October 9, 2000
Recap of Events - Throughout most of the Funds' fiscal year ended August 31,
2000, the Federal Reserve Board focused on tightening the U.S. money supply,
conducting a prolonged series of interest rate hikes. A strong U.S. economy and
threatening inflation prompted the Fed to bump up short-term interest rates four
times during the period, with the last increase coming on May 16, 2000.
During the fall of 1999, many bond buyers seemed to be ignoring municipal bonds
in favor of the higher-yielding corporate bonds that were flooding the market.
That scenario changed later in our fiscal year when interest rate hikes in
February and March, coupled with the U.S. Treasury buyback and turmoil in the
U.S. stock market in April, led to a marked increase in demand for the safety of
U.S. Treasury securities. We believe rising Treasury prices left municipal bonds
in a position of relative value. Retail investors began to recognize this value
as Treasury yields dropped and AAA-rated municipal bond yields exceeded 6% in
March. Since then, we have generally seen demand for municipal bonds on the
upswing.*
Increased tax revenue resulting from the strong economy and higher borrowing
costs resulting from rising interest rates caused many state and local
governments to reduce the number of municipal bonds they issued during our
fiscal year. This caused demand to exceed supply as we ended our year (Source:
Moody's Investors Service Inc.).
The flip-flop between supply and demand in the municipal markets happened
gradually throughout 2000. The Fed's latest interest rate hike in May supported
that trend. By the end of our fiscal year, demand for municipal bonds remained
high while municipal bond issuance for 2000 declined by about 19% from the same
period one year prior, a reduction of about $33 billion (Source: Thomson
Financial).
Long-term interest rates began to decline during the summer months, with the
30-year mortgage rate at 7.64% on August 31, 2000, about three quarters of a
percentage point off its spring 2000 high for the year. The average yield on
30-year AAA-rated municipal bonds, which rarely is more than the yield for the
30-year Treasury bond, stood at 5.68% on August 31, 2000. By comparison, the
30-year Treasury bond was yielding 5.66% and two-year Treasury notes were
yielding 6.16% on August 31, 2000 (Source: Bloomberg). For municipal bond
tax-equivalent yields, see the chart on page 3.
Total Return
For the Period Ended August 31, 2000 One Year
--------------------------------------------------------------------------------
Delaware Tax-Free Florida Fund Class A +4.11%
Lipper Florida Municipal Debt Funds Average (64 funds) +4.86%
--------------------------------------------------------------------------------
Delaware Tax-Free Florida Insured Fund Class A +5.29%
Lipper Florida Insured Municipal Debt Funds Average (14 funds) +5.66%
--------------------------------------------------------------------------------
Delaware Tax-Free New York Fund Class A +5.09%
Lipper New York Municipal Debt Funds Average (106 funds) +5.29%
--------------------------------------------------------------------------------
Lehman Brothers Municipal Bond Index +6.77%
Lehman Brothers Insured Municipal Bond Index +7.42%
--------------------------------------------------------------------------------
All performance shown above is at net asset value without the effect of sales
charges and assumes reinvestment of all distributions. Performance information
for all Fund classes can be found on pages 6 through 8. The Lipper categories
represent the average returns of state-specific municipal bond funds tracked by
Lipper (Source: Lipper, Inc.). The Lehman Brothers Municipal Bond Index is an
unmanaged index that generally tracks the performance of municipal bonds. The
Lehman Brothers Insured Municipal Bond Index is an unmanaged index that
generally tracks the performance of insured municipal bonds. 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.
1
<PAGE>
[Tax-Exempt Income Artwork]
Delaware Tax-Free New York Fund returned +5.09% (Class A shares at net asset
value with distributions reinvested), Delaware Tax-Free Florida Fund returned
+4.11% (Class A shares at net asset value with distributions reinvested), and
Delaware Tax-Free Florida Insured Fund returned +5.29% (Class A shares at net
asset value with distributions reinvested) for the year ended August 31, 2000.
In each case, performance trailed the Lehman Brothers Municipal Bond Index and
was slightly less than the average fund in the relative Lipper class. In all
three cases, the difference between the Fund's return and that of the respective
benchmark can be partially attributed to management's approach to the Fund's
duration, a common measure of a bond or bond fund's sensitivity to interest
rates.
Market Outlook - We are encouraged by the current market environment. As of this
writing, the predominant opinion on Wall Street is that the Fed is firmly in a
holding pattern with regard to its actions on interest rates. Evident slowing in
the U.S. economy, which has prompted the Fed to leave rates untouched at its
last three meetings, could eventually lead to lesser revenues for states and
municipalities. In our opinion, this would likely lead to a general increase in
the issuance of municipal bonds.
We believe that municipal bonds will continue to play a role in well-diversified
portfolios. In addition, we believe that in an environment where interest rates
trend downward, investing in municipal bond funds will be more attractive to
investors than buying individual bonds. In such an environment, municipal bond
funds, like Delaware's, are holding slightly older bonds -- often issued at more
attractive rates than most new issues coming to market. On the pages that
follow, your Funds' portfolio managers explain the Funds' positioning during the
period and provide a view of issues affecting the municipal markets.
Thank you for your continued confidence, and your commitment to
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 Family of Funds Delaware Investments Family of Funds
2
<PAGE>
Mitchell L. Conery
Senior Portfolio Manager
Patrick P. Coyne
Senior Portfolio Manager
October 9, 2000
PORTFOLIO MANAGEMENT REVIEW
---------------------------
The Funds' Results
During the year ended August 31, 2000, we began to see strong performance in
municipal markets despite changes in interest rates. While municipal bond fund
cash flows are negative year-to-date, July 2000 brought positive numbers, with
investors pouring a net $850 million dollars into municipal bond funds -- a
trend that we hope to see continue (Source: Investment Company Institute).
The year was characterized by a continued diminishing of municipal bond supply,
as states, counties, and municipalities issued fewer bonds. This was likely due
to strong local economies and tax bases, as well as the dramatic decline in bond
refunding. Bond issues for public projects such as water and sewer,
transportation, and higher education often exhibited strength, while credit
upgrades were substantial -- especially among bonds whose principal and interest
payments are backed by taxes (Source: Moody's Investors Service).
We continued to limit our investments in the healthcare sector. The cloudy
outlook for the future of Medicaid/Medicare may have been among the reasons that
municipal bonds in this sector often faced pressures. Of the 37 credit
downgrades that Moody's has made to revenue bonds in 2000, 28 have been to
healthcare bonds (Source: Moody's Investors Service). When investing in
healthcare issues, we use careful research and always keep an eye out for
undervalued bond issues.
The uncertainty surrounding interest rates, meanwhile, dictated the need
throughout our fiscal year for managing portfolio duration, a common measure of
a bond or bond fund's sensitivity to interest rate changes. The shorter a bond
fund's duration, the less sensitive the fund is to changes in interest rates.
30-Year AAA-Rated Municipal Bonds
Tax-Equivalent Yields
As of August 31,2000
10% 9.40% ----------------------------------
9% 8.88% As of August 31, 2000, the yield
8% 7.88% 8.23% on 30-year AAA-rated municipal
7% 6.68% bonds nationally was 5.68%
6% (Source: Bloomberg). The chart
5% shows what the equivalent yield
4% would be on a taxable investment
3% for investors in each tax bracket.*
2% -----------------------------------
1%
0%
-------------------------------------
15% 28% 31% 36% 39.6%
Income Tax Bracket
* Principal and interest of municipal bonds, unlike U.S. Treasury securities,
are not guaranteed by the U.S. government. The above illustration is not
intended to represent the yield of any mutual fund from Delaware Investments.
3
<PAGE>
Delaware Tax-Free Florida Fund
Portfolio Characteristics
August 31, 2000
----------------------------------------
Current 30-Day SEC Yield* 4.80%
----------------------------------------
Average Rating A
----------------------------------------
Average Effective Duration** 7.55 years
----------------------------------------
Average Effective Maturity***12.41 years
----------------------------------------
* For Class A shares measured according to
Securities and Exchange Commission
(SEC) guidelines. Current 30-day SEC yield
as of 8/31/00 for both Class B and C
shares was 4.24%.
Delaware Tax-Free Florida Insured
Fund Portfolio Characteristics
August 31, 2000
----------------------------------------
Current 30-Day SEC Yield* 4.42%
----------------------------------------
Average Credit Rating AAA
----------------------------------------
Average Effective Duration** 7.55 years
----------------------------------------
Average Effective Maturity***11.22 years
----------------------------------------
*For Class A shares measured according to Securities and Exchange Commission
(SEC) guidelines. Current 30-day SEC yield as of 8/31/00 for both Class B
and C shares was 3.85% and 3.84%, respectively.
**Average effective duration is a common measure of a bond or bond fund's
sensitivity to interest rate changes.
***Average effective maturity is the average time remaining until scheduled
principal payment by issuers of portfolio securities.
Delaware Tax-Free Florida Fund
During the first half of our fiscal year, we concentrated on shortening the
portfolio's duration so that the Fund would be less interest-rate sensitive. The
duration had been slightly longer than that of other funds in the Lipper Florida
Municipal Debt Funds class, which meant that the prices of our bonds generally
declined more than the average when interest rates rose (conversely, if interest
rates fall, longer-duration bonds outperform those with short durations).
As the fiscal year progressed, we managed to bring our duration more in line
with our peers and, as a result, your Fund benefited from the rally that took
place in the municipal bond market through the spring and summer of 2000. To
gain perspective on the rally in municipals, consider that municipal bond
markets, in general, had posted negative returns for the six-month period ended
February 29, 2000 (Source: Lipper Inc.). However, for the one-year period ended
August 31, 2000, your Fund had returned +4.11%.
One of our strategies during the year was to purchase bonds with higher coupons
-- higher stated rates of interest on the bond. This is considered a defensive
strategy, as we occasionally pay a premium for the higher coupons, but are
rewarded by having a portfolio which generates more income that can be
reinvested.
The Florida economy continues to be strong, and we continue to hold bonds from
the Florida State Housing Finance Agency, as well as from hospitals and schools.
We also hold a high percentage of dedicated-tax bonds. On a positive note for
Florida-based investors, the state legislature has enacted changes to limit the
intangibles tax, an annual tax imposed on residents for all intangible personal
property -- such as stocks, bonds and other securities (Source: Miami Herald).
Delaware Tax-Free Florida Insured Fund
We have traditionally taken a conservative approach to the portfolio's interest
rate sensitivity, which is in accordance with the Fund's more conservative
investment objectives. As a result, we kept the portfolio's duration short
throughout the fiscal year.
According to the Association of Financial Guaranty Insurers -- an industry
association that includes the four largest bond insurers in the U.S. -- about
50% of all new municipal bond issues are currently insured, compared to just 20%
one decade ago. Insured, AAA-rated municipal bonds comprise the top tier of
creditworthiness among municipal bonds.
Delaware Tax-Free Florida Insured Fund invests exclusively in insured, AAA-rated
municipal bonds. Although issuance of insured bonds has risen in recent years,
the universe of securities available to us is still relatively small. For this
reason, and because of the Fund's conservative investment objectives, we felt
that extending duration in an effort to increase total return would have
involved taking on an inappropriate degree of risk. At times during the period,
it appeared to us that some of our peers were more aggressive in their approach,
and we believe this to be the reason we trailed our relative Lipper Average. For
the year ended August 31, 2000, Delaware Tax-Free Florida Insured Fund returned
+5.29%, compared to +5.66% for the Lipper Florida Insured Municipal Debt Funds
Average.
4
<PAGE>
Delaware Tax-Free New York
Fund Portfolio Characteristics
August 31, 2000
----------------------------------------
Current 30-Day SEC Yield* 4.77%
----------------------------------------
Average Rating AA
----------------------------------------
Average Effective Duration** 7.79 years
----------------------------------------
Average Effective Maturity***13.49 years
----------------------------------------
*For Class A shares measured according to Securities and Exchange Commission
(SEC) guidelines. Current 30-day SEC yield as of 8/31/00 for both Class B
and C shares was 4.22%.
**Average effective duration is a common measure of a bond or bond fund's
sensitivity to interest rate changes.
***Average effective maturity is the average time remaining until scheduled
principal payment by issuers of portfolio securities.
Delaware Tax-Free New York Fund
During the first half of the fiscal year, we concentrated on shortening the
portfolio's duration, so that the Fund would be less interest-rate sensitive.
The duration had been slightly longer than that of our average peer in the
Lipper New York Municipal Debt Funds class, which meant that the prices of our
bonds generally declined more than the average when interest rates were rising
(conversely, if interest rates fall, longer-duration bonds outperform those with
short durations).
We believe that shortening our duration was a prudent strategy considering the
nature of the interest rate outlook during the period. The shorter duration
helped the Fund's performance in a rising interest rate environment. In
retrospect, given some of the credit upgrades that occurred in New York, the
shorter duration posture may not have been necessary. For example, New York's
strong economy led Standard & Poor's to upgrade the state's credit rating during
the year. Credit rating agencies also upgraded a number of water and sewer bonds
in the state (Source: Standard & Poor's).
Although shortening duration meant taking less risk and perhaps limiting the
possible upside on the Fund's return, by August 31, 2000 your Fund had returned
+5.09% for its fiscal year. As was the case with our peers, most of our positive
performance was achieved in the second half of this fiscal year.
Outlook
In the months ahead, we anticipate a positive environment for municipal bonds.
We think it is possible that the strong performance seen in the first half of
2000 could continue through the fall.
As always with municipal bonds, this depends largely on interest rate trends, as
well as supply and demand in the municipal markets. The Federal Reserve Board
has promised to remain vigilant about keeping inflation under control and could
continue with interest rate increases in the future. As of this writing,
however, many analysts and investors seem to believe that the Fed may be
finished with increases -- at least for the rest of this year. Long-term
interest rates, meanwhile, are generally trending downward.
We feel that a non-inflationary U.S. economy that has less-robust growth is
likely to boost the demand for capital funding. This would be a positive for
municipal bonds and for the Fund. In our opinion, municipal bond funds will
continue to be an important investment vehicle -- which can provide excellent
diversification to an investor's portfolio, as well allowing individual
investors to preserve their own capital and generate non-taxable income.*
*A portion of the income from tax-exempt funds may be subject to the alternative
minimum tax.
5
<PAGE>
FUND BASICS
-----------
Fund Objectives
The Fund seeks as high a level of
current income exempt from both
federal income taxes and from
Florida personal income tax as is
consistent with preservation of
capital.
Total Fund Assets
As of August 31, 2000
$13.19 million
Number of Holdings
32
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 at Albany. 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' fixed-income
department in 1990.
Nasdaq Symbols
Class A DVFAX
Class B DVFBX
Class C DVFCX
<PAGE>
DELAWARE TAX-FREE FLORIDA FUND PERFORMANCE
------------------------------------------
Growth of a $10,000 Investment
March 2, 1995 to August 31, 2000
Delaware Tax-Free Florida Fund Growth of $10,000 investment chart
-----------------------------------------------------------------
Delaware Tax-Free U.S. Consumer Lehman Brothers
Florida Fund Class A Price Index Municipal Bond Index
03/02/1995 $ 9,625 $10,000 $10,000
08/31/1995 $10,088 $10,099 $10,469
02/29/1996 $10,806 $10,231 $10,978
08/31/1996 $10,795 $10,390 $11,017
02/28/1997 $11,347 $10,542 $11,583
08/31/1997 $11,895 $10,621 $12,036
02/28/1998 $12,611 $10,694 $12,642
08/31/1998 $13,122 $10,793 $13,077
02/28/1999 $13,360 $10,865 $13,419
08/31/1999 $12,924 $11,037 $13,148
02/29/2000 $12,627 $11,209 $13,140
08/31/2000 $13,455 $11,403 $14,033
Chart assumes $10,000 invested on March 2, 1995. Fund performance includes the
effect of a 3.75% front-end sales charge and reinvestment of all distributions.
Points were plotted as of month's end. Performance for other Fund classes will
vary due to differing charges and expenses. Past performance does not guarantee
future results.
Average Annual Total Returns
Through August 31, 2000 Lifetime Five Year One Year
--------------------------------------------------------------------------------
Class A (3/2/95)
Excluding Sales Charge +6.30% +5.93% +4.11%
Including Sales Charge +5.57% +5.12% +0.21%
--------------------------------------------------------------------------------
Class B (Est. 9/15/95)
Excluding Sales Charge +4.98% +3.34%
Including Sales Charge +4.64% -0.61%
--------------------------------------------------------------------------------
Class C (Est. 4/22/95)
Excluding Sales Charge +5.15% +5.15% +3.38%
Including Sales Charge +5.15% +5.15% +2.39%
--------------------------------------------------------------------------------
Returns reflect reinvestment of distributions and any applicable sales charge as
noted below. Returns and share value will fluctuate so that shares, when
redeemed, may be worth more or less than the original cost. Class B and C share
results, excluding sales charge, assume either that contingent deferred sales
charges were not applied or the investment was not redeemed. Past performance is
not a guarantee of 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 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 periods shown. Performance would have been lower if the expense
limitation was not in effect.
6
<PAGE>
FUND BASICS
-----------
Fund Objectives
The Fund seeks as high a level of
current income exempt from both
federal income taxes and from
Florida personal income tax as is
consistent with preservation of
capital.
Total Fund Assets
As of August 31, 2000
$116.03 million
Number of Holdings
48
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 DVDCX
<PAGE>
DELAWARE TAX-FREE FLORIDA INSURED
---------------------------------
FUND PERFORMANCE
----------------
Growth of a $10,000 Investment
January 1, 1992 to August 31, 2000
Delaware Tax-Free Florida Fund Growth of $10,000 Investment chart
-----------------------------------------------------------------
Delaware Tax-Free Lehman Brothers
Florida Insured Fund U.S. Consumer Insured Municipal
Class A Price Index Bond Index
1/1/92 $ 9,625 $10,000 $10,000
8/31/92 $10,284 $10,218 $10,645
8/31/93 $11,882 $10,500 $12,045
8/31/94 $11,558 $10,805 $11,986
8/31/95 $12,500 $11,088 $13,078
8/31/96 $13,238 $11,407 $13,788
8/31/97 $14,528 $11,661 $15,085
8/31/98 $15,833 $11,849 $16,474
8/31/99 $15,700 $12,117 $16,425
8/31/00 $16,532 $12,519 $17,644
Chart assumes $10,000 invested on January 1, 1992. Fund performance includes the
effect of a 3.75% front-end sales charge and reinvestment of all distributions.
Points were plotted as of month's end. Performance for other Fund classes will
vary due to differing charges and expenses. Past performance does not guarantee
future results.
Average Annual Total Returns
Through August 31, 2000 Lifetime Five Year One Year
--------------------------------------------------------------------------------
Class A (Est.1/1/92)
Excluding Sales Charge +6.46% +5.76% +5.29%
Including Sales Charge +5.99% +4.94% +1.34%
--------------------------------------------------------------------------------
Class B (Est. 3/11/94)
Excluding Sales Charge +4.75% +5.06% +4.50%
Including Sales Charge +4.75% +4.73% +0.50%
--------------------------------------------------------------------------------
Class C (Est. 9/29/97)*
Excluding Sales Charge +3.28% +4.49%
Including Sales Charge +3.28% +3.49%
--------------------------------------------------------------------------------
*Class C shares were sold and outstanding from September 29, 1997 until December
18, 1997, when all of the outstanding Class C shares were redeemed. There were
no outstanding Class C shares or shareholder activity from December 19, 1997
through January 7, 1999. The performance for Class C shares during the period
from December 19, 1997 through January 7, 1999 is based on the performance of
Class B shares.
Returns reflect reinvestment of distributions and any applicable sales charge as
noted below. Returns and share values will fluctuate so that shares, when
redeemed, may be worth more or less than the original cost. Class B and C share
results, excluding sales charge, assume either that contingent deferred sales
charges were not applied or the investment was not redeemed. Past performance is
not a guarantee of 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 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 periods shown. Performance would have been lower if the
expense limitation was not in effect.
7
<PAGE>
FUND BASICS
-----------
Fund Objectives
The Fund seeks as high a level of
current income exempt from federal
income taxes and New York
personal income tax as is consistent
with preservation of capital.
Total Fund Assets
As of August 31, 2000
$11.44 million
Number of Holdings
24
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
[GRAPHIC OMITTED]
<PAGE>
DELAWARE TAX-FREE NEW YORK FUND PERFORMANCE
-------------------------------------------
Growth of a $10,000 Investment
August 31, 1990 to August 31, 2000
Delaware Tax-Free New York Fund Growth of $10,000 investment chart
------------------------------------------------------------------
Delaware Tax-Free U.S. Consumer Lehman Brothers
New York Fund Class A Price Index Municipal Bond Index
Aug-90 $ 9,628 $10,000 $10,000
Aug-91 $10,634 $10,380 $11,179
Aug-92 $11,931 $10,707 $12,400
Aug-93 $13,293 $11,003 $13,944
Aug-94 $13,391 $11,332 $13,963
Aug-95 $14,172 $11,609 $15,201
Aug-96 $14,670 $11,953 $15,997
Aug-97 $15,532 $12,219 $17,476
Aug-98 $16,657 $12,416 $18,987
Aug-99 $16,248 $12,698 $19,091
Aug-00 $13,118 $13,118 $20,376
Chart assumes $10,000 invested on August 31, 1990. Fund performance includes the
effect of a 3.75% front-end sales charge and reinvestment of all distributions.
Points were plotted as of month's end. Performance for other Fund classes will
vary due to differing charges and expenses. Past performance does not guarantee
future results.
Average Annual Total Returns
Through August 31, 2000 Lifetime 10 Year Five Year One Year
--------------------------------------------------------------------------------
Class A (11/6/87)
Excluding Sales Charge +6.43% +5.92% +3.82% +5.09%
Including Sales Charge +6.11% +5.51% +3.04% +1.19%
--------------------------------------------------------------------------------
Class B (Est. 11/14/94)
Excluding Sales Charge +4.17% +3.04% +4.41%
Including Sales Charge +4.04% +2.72% +0.43%
--------------------------------------------------------------------------------
Class C (Est. 4/26/95)
Excluding Sales Charge +3.24% +3.00% +4.31%
Including Sales Charge +3.24% +3.00% +3.31%
--------------------------------------------------------------------------------
Returns reflect reinvestment of distributions and any applicable sales charge as
noted below. Return and share value will fluctuate so that shares, when
redeemed, may be worth more or less than the original cost. Class B and C share
results, excluding sales charge, assume that contingent deferred sales charges
did not apply or the investment was not redeemed. Past performance is not a
guarantee of 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 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 periods shown. 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
August 31, 2000 Amount Value
--------------------------------------------------------------------------------
Municipal Bonds - 98.66%
Continuing Care / Retirement Revenue Bonds - 3.38%
Jacksonville Health Facilities Authority
(Cypress Village Project National Benevolent
Association) Series A 6.125% 12/1/16 .............. $200,000 $ 187,750
Volusia County Health Facilities Authority
(John Knox Village) Series A
6.00% 6/1/17 (ASSET GTY) .......................... 250,000 257,448
---------
445,198
---------
General Obligation Bonds - 2.00%
Florida State Board of Education (Cap Outlay
Public Education) 6.00% 6/1/21 (FGIC) ............. 250,000 263,955
---------
263,955
---------
Higher Education Revenue Bonds - 3.01%
Pinellas County Educational Facilities Authority
(Clearwater Christian College) Private
Placement 8.00% 2/1/11 ............................ 375,000 397,031
---------
397,031
---------
Highway Revenue Bonds - 1.35%
Dunes Community Development District-
Intracoastal Waterway Bridge (ITT Industries
Corporation) 5.50% 10/1/07 ........................ 175,000 178,399
---------
178,399
---------
Hospital Revenue Bonds - 12.48%
Escambia County Health Facilities Authority
Revenue (VHA Program) 5.95% 7/1/20
(AMBAC) ........................................... 500,000 518,310
Lee County Hospital Board (Lee Memorial
Hospital) 6.35% 3/26/20 (MBIA) .................... 500,000 515,105
Leesburg Regional Medical Center Project
Series A 6.125% 7/1/12 ............................ 100,000 101,633
North Miami Health Facilities Authority
(Catholic Health Services) 6.00% 8/15/16
(LOC Suntrust Bank-Miami) ......................... 500,000 510,735
---------
1,645,783
---------
Housing Revenue Bonds - 11.42%
Dade County Housing Finance Authority
(Lincoln Fields Apartments Section 8)
6.25% 7/1/24 (FHA) (MBIA) ......................... 500,000 510,130
Duval Housing Finance Authority (St. Augustine
Apartments) 6.00% 3/1/21 .......................... 300,000 305,055
Florida Housing Finance Agency (Homeowner
Mortgage) Series 1B 6.00% 7/1/17
(FHA/VA) .......................................... 170,000 174,226
Florida Housing Finance Agency (The Vineyards
Project) Series H 6.40% 11/1/15 ................... 500,000 517,315
---------
1,506,726
---------
<PAGE>
Principal Market
Amount Value
--------------------------------------------------------------------------------
Municipal Bonds (continued)
*Pre-Refunded Bonds - 3.72%
St. Lucie County (Special Assessment South
Hutchinson Island) 6.10% 11/1/20-05
(ASSET GTY) ....................................... $150,000 $ 163,521
Volusia Industrial Development Authority
(Bishops Glen Project Retirement Health
Facilities) 7.50% 11/1/16-06 ...................... 295,000 326,972
---------
490,493
---------
Territorial Revenue Bonds - 1.55%
Puerto Rico Commonwealth Highway &
Transportation Authority (Highway Revenue)
6.00% 7/1/26 ...................................... 150,000 155,565
Puerto Rico Electric Power Authority Series X
5.50% 7/1/25 ...................................... 50,000 49,462
---------
205,027
---------
Transportation Revenue Bonds - 1.22%
Florida State Mid-Bay Bridge Authority
Series D 6.125% 10/1/22 ........................... 160,000 160,232
---------
160,232
---------
Waste Disposal Revenue Bonds - 1.13%
Jacksonville Sewer & Solid Waste Disposal
Facilities Authority (Anheuser Busch Project)
5.875% 2/1/36 (AMT) ............................... 150,000 149,657
---------
149,657
---------
Water & Sewer Revenue Bonds - 9.41%
Jacksonville Electric Authority Revenue Water &
Sewer Systems Series A 5.625% 10/1/37 ............. 500,000 498,815
Tavares Water & Sewer Revenue 5.50%
10/1/30 (AMBAC) ................................... 750,000 742,350
---------
1,241,165
---------
Other Revenue Bonds - 47.99%
Brevard County Constitutional Fuel Tax 6.00%
8/1/14 ............................................ 1,145,000 1,245,210
Dade County Special Obligation Series B
5.00% 10/1/35 (AMBAC) ............................. 200,000 181,368
Florida State Board of Education (Lottery
Revenue) Series A 6.00% 7/1/14 (FGIC) ............. 1,000,000 1,079,230
Lake Bernadette Community Development
District (Special Assessment) Series A
8.00% 5/1/17 ...................................... 250,000 255,175
Northern Palm Beach County Improvement
District (Special Assessment - Abacoa Water
Control) 7.20% 8/1/16 ............................. 300,000 319,458
Orlando Special Assessment (Conroy Road
Interchange) Series B 5.25% 5/1/05 ................ 380,000 369,896
St. Lucie Improvement Revenue 5.50% 4/1/23
(MBIA) ............................................ 500,000 500,345
Tampa Palms Community Development District
(Richmond Place Project) 7.50% 5/1/18 ............. 235,000 242,541
9
<PAGE>
Statements of Net Assets (continued)
Principal Market
Delaware Tax-Free Florida Fund Amount Value
--------------------------------------------------------------------------------
Municipal Bonds (continued)
Other Revenue Bonds (continued)
Tampa Utilities Tax Revenue Series A
6.00% 10/1/17 (AMBAC) ....................... $1,000,000 $ 1,064,470
6.125% 10/1/18 (AMBAC) ...................... 1,000,000 1,070,950
-----------
6,328,643
-----------
Total Municipal Bonds
(cost $12,537,797) .......................... 13,012,309
-----------
Number of
Shares
Short-Term Investments - 0.24%
Wells Fargo National Tax-Free Money
Market Fund ................................. 32,257 32,257
-----------
Total Short-Term Investments
(cost $32,257) .............................. 32,257
-----------
Total Market Value of Securities - 98.90%
(cost $12,570,054) .......................... 13,044,566
Receivables and Other Assets
Net of Liabilities - 1.10% ................. 143,988
-----------
Net Assets Applicable to 1,256,525 Shares
Outstanding - 100.00% ....................... $13,188,554
===========
Net Asset Value - Delaware Tax-Free
Florida Fund A Class
($8,710,752 / 836,275 Shares) ............... $10.42
------
Net Asset Value - Delaware Tax-Free
Florida Fund B Class
($4,044,484 / 387,680 Shares) ............... $10.43
------
Net Asset Value - Delaware Tax-Free
Florida Fund C Class
($433,318 / 41,570 Shares) .................. $10.42
------
------------------
*For Pre-Refunded Bonds, the stated maturity is followed by the year in which
each bond is pre-refunded.
<PAGE>
--------------------------------------------------------------------------------
Components of Net Assets at August 31, 2000:
Shares of beneficial interest (unlimited
authorization - no par) ..................... $13,814,106
Accumulated net realized loss
on investments .............................. (1,100,064)
Net unrealized appreciation of investments ..... 474,512
-----------
Total net assets ............................... $13,188,554
===========
------------------
Summary of Abbreviations:
ASSET GTY - Insured by the Asset Guaranty Insurance Company
AMBAC - Insured by the AMBAC Indemnity Corporation
AMT - Subject to Alternative Minimum Tax
FGIC - Insured by the Financial Guaranty Insurance Company
FHA - Insured by the Federal Housing Authority
LOC - Letter of Credit
MBIA - Insured by the Municipal Bond Insurance Association
VA - Insured by the Veterans Administration
Net Asset Value and Offering Price per Share -
Delaware Tax-Free Florida 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
10
<PAGE>
Statements of Net Assets (continued)
DELAWARE TAX-FREE FLORIDA INSURED FUND
Principal Market
August 31, 2000 Amount Value
--------------------------------------------------------------------------------
Municipal Bonds - 99.26%
General Obligation Bonds - 7.91%
Florida State Board of Education Capital Outlay
Public Education-Series B 4.50% 6/1/28
(MBIA) .......................................... $11,000,000 $ 9,179,830
-----------
9,179,830
-----------
Higher Education Revenue Bonds - 2.58%
Miami-Dade County Florida Educational Facilities
Authority University of Miami
Series A 5.50% 4/1/19 (AMBAC) ...................... 950,000 957,239
Series A 5.75% 4/1/29 (AMBAC) ...................... 2,000,000 2,038,860
-----------
2,996,099
-----------
Hospital Revenue Bonds - 18.28%
Escambia County Florida Health Facilities
Authority Revenue (VHA Program) 5.95%
07/01/20 (AMBAC) ................................ 5,000,000 5,183,100
Indian River County Hospital District 6.10%
10/1/18 (FSA) ................................... 3,000,000 3,143,760
Lee County Hospital Board (Lee Memorial
Hospital) 6.35% 3/26/20 (MBIA) .................. 10,000,000 10,302,100
Tallahassee Health Facilities (Tallahassee
Memorial Regional Medical Center)
Series B 6.00% 12/1/15 (MBIA) ................... 2,500,000 2,575,875
-----------
21,204,835
-----------
Housing Revenue Bonds - 25.36%
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) ........... 750,000 773,400
6.20% 12/1/36 (AMT) (AMBAC) ..................... 1,790,000 1,851,558
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) ........... 485,000 496,073
6.05% 12/1/36 (AMT) (AMBAC) ..................... 700,000 714,469
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 2,859,840
6.30% 9/1/36 (AMT) (AMBAC) ...................... 2,000,000 2,068,340
Florida State Housing Finance Agency Mariner
Club Apartments - Series K-1
6.25% 9/1/26 (AMT) (AMBAC) ...................... 2,000,000 2,081,460
6.375% 9/1/36 (AMT) (AMBAC) ..................... 3,500,000 3,656,695
Florida State Housing Finance Agency Riverfront
Apartments Section 8 Series A 6.25% 4/1/37
(AMT) (AMBAC) ................................... 1,000,000 1,032,040
<PAGE>
Principal Market
Amount Value
--------------------------------------------------------------------------------
Municipal Bonds (continued)
Housing Revenue Bonds (continued)
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 $ 526,515
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 1,055,620
6.40% 12/1/26 (AMT) (AMBAC) ....................... 1,500,000 1,570,515
6.50% 6/1/36 (AMT) (AMBAC) ........................ 6,540,000 6,871,251
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 1,805,650
6.25% 6/1/36 (AMT) (AMBAC) ........................ 2,000,000 2,063,340
----------
29,426,766
----------
Ports and Harbors Revenue Bonds - 0.90%
Canaveral Port Authority 6.00%
6/1/12 (FGIC) ..................................... 1,000,000 1,039,800
----------
1,039,800
----------
*Pre-Refunded Bonds - 12.75%
Florida State Turnpike Authority 6.30%
7/1/12-02 (FGIC) .................................. 2,000,000 2,087,280
Miramar Wastewater Improvement Assessment
6.75% 10/1/25-04 (FGIC) ........................... 2,425,000 2,656,393
North Port Utilities System 6.15%
10/1/09-02 (FGIC) ................................. 1,500,000 1,581,495
Palm Beach Solid Waste Authority
6.00% 12/1/07-02 (MBIA) ........................... 1,000,000 1,053,760
6.25% 12/1/08-02 (MBIA) ........................... 2,000,000 2,118,080
Port St. Lucie Utility System 6.00%
9/1/24-04 (FGIC) .................................. 5,000,000 5,291,400
----------
14,788,408
----------
Sales Tax Revenue Bonds - 7.31%
Bay County Sales Tax Revenue
4.75% 9/1/23 (FSA) ................................ 5,500,000 4,871,405
Jupiter Sales Tax
6.375% 9/1/20 (AMBAC) ............................. 2,500,000 2,578,325
Marion County Public Improvement
Revenue Sales Tax 6.125% 12/1/08 (MBIA) ........... 1,000,000 1,037,430
----------
8,487,160
----------
Water & Sewer Revenue Bonds - 2.68%
Coral Springs Water and Sewer Series A
6.00% 9/1/10 (FGIC) ............................... 1,000,000 1,043,770
Jupiter Water Series A
6.25% 10/1/12 (AMBAC) ............................. 2,000,000 2,071,000
----------
3,114,770
----------
11
<PAGE>
Statements of Net Assets (continued)
Principal Market
Delaware Tax-Free Florida Insured Fund Amount Value
--------------------------------------------------------------------------------
Municipal Bonds (continued)
Other Revenue Bonds - 21.49%
Lee County Airport Revenue Series B 5.75%
10/01/33 (FSA) ................................. $3,000,000 $ 3,051,480
Nassau County Optional Gas Tax-Fuel Sales Tax
6.00% 3/1/09 (FGIC) ............................ 1,000,000 1,040,630
New Smyrna Beach Utilities Commission 6.00%
10/1/13 (FGIC) ................................. 1,000,000 1,039,050
Ocala Optional Gas Tax-Fuel Sales Tax 6.00%
12/1/09 (AMBAC) ................................ 1,000,000 1,050,470
Ocoee Revenue Refunding and
Improvement Transportation
4.50% 10/1/23 (MBIA) ........................... 1,000,000 847,730
4.50% 10/1/28 (MBIA) ........................... 1,000,000 832,050
Orange County Tourist Development Tax Revenue
4.75% 10/1/20 (AMBAC) .......................... 1,000,000 897,420
5.50% 10/1/31 (AMBAC) .......................... 4,000,000 3,964,520
Osceola County Celebration Community
Development District Assessment
6.10% 5/1/16 (MBIA) ............................ 690,000 714,743
Osceola County Enterprise Community
Development District - Special Assessment
6.10% 5/1/16 (MBIA) ............................ 1,000,000 1,035,860
Palm Beach County Criminal Facilities
Revenue 5.75% 6/1/12 (FGIC) .................... 195,000 209,645
Palm Beach County Criminal Justice Residual
Certificates - Series 191
6.89% 06/1/12 (FGIC) ........................... 7,500,000 8,649,975
Tampa Utilities Tax and Special Revenue
6.00% 10/01/08 ................................. 1,500,000 1,602,645
-----------
24,936,218
-----------
Total Municipal Bonds
(cost $112,608,771) 115,173,886
-----------
Number
of Shares
Short-Term Investments - 0.25%
Norwest Advantage Municipal Money
Market Fund .................................... 293,287 293,287
-----------
Total Short-Term Investments
(cost $293,287) 293,287
-----------
<PAGE>
--------------------------------------------------------------------------------
Total Market Value of Securities - 99.51%
(cost $112,902,058) ............................. $115,467,173
Receivables and Other Assets
Net of Liabilities - 0.49% ..................... 563,330
------------
Net Assets Applicable to 10,770,748 Shares
Outstanding - 100.00% .......................... $116,030,503
============
Net Asset Value - Delaware Tax-Free
Florida Insured Fund A Class
($110,707,699 / 10,276,746 Shares) ............. $10.77
------
Net Asset Value - Delaware Tax-Free
Florida Insured Fund B Class
($5,272,390 / 489,326 Shares) .................. $10.77
------
Net Asset Value - Delaware Tax-Free
Florida Insured Fund C Class
($50,414 / 4,676 Shares) ....................... $10.78
------
------------------------------
*For Pre-Refunded Bonds, the stated maturity is followed by the year in which
each bond is pre-refunded.
Components of Net Assets at August 31, 2000:
Shares of beneficial interest
(unlimited authorization - no par) ............. 120,050,719
Undistributed net investment income ............... 271
Accumulated net realized
loss on investments ............................ (6,585,602)
Net unrealized appreciation of investments ........ 2,565,115
------------
Total net assets .................................. $116,030,503
============
-----------------
Summary of Abbreviations:
AMBAC - Insured by the AMBAC Indemnity Corporation
AMT - Subject to Alternative Minimum Tax
FGIC - Insured by the Financial Guaranty Insurance Company
FSA - Insured by Financial Security Assurance
LOC - Letter of Credit
MBIA - Insured by the Municipal Bond Insurance Association
Net Asset Value and Offering Price per Share -
Delaware Tax-Free Florida Insured Fund
Net asset value A Class (A) ....................... $10.77
Sales charge (3.75% of offering price or 3.90% of
amount invested per share) (B) ................. 0.42
------
Offering price .................................... $11.19
======
-----------------
(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
12
<PAGE>
Statements of Net Assets (continued)
DELAWARE TAX-FREE NEW YORK FUND
Principal Market
August 31, 2000 Amount Value
--------------------------------------------------------------------------------
Municipal Bonds - 98.12%
City Agencies Revenue Bonds - 4.72%
New York City Transitional Finance Authority
Future Tax Secured Revenue Series B
6.125% 11/15/15 .................................. $500,000 $ 539,840
---------
539,840
---------
General Obligation Bonds - 3.76%
New York City Series C
5.375% 11/15/27 .................................. 450,000 429,867
---------
429,867
---------
Higher Education Revenue Bonds - 23.91%
Albany Industrial Development Agency
(Sage Colleges Project) Series A
5.30% 4/1/29 ..................................... 500,000 460,725
Albany Industrial Development Agency
Facilities (Albany Law School Project)
Series A 5.75% 10/1/30 (ASSET GTY) ............... 300,000 297,861
Amherst Industrial Development Agency Civic
Facility Revenue (University of Buffalo
Student Housing) Series A
5.75% 8/1/30 (AMBAC) ............................. 450,000 457,735
New York State Dormitory Authority Revenue
(Chapel Oaks) 5.45% 7/1/26
(LOC Allied Irish Bank) .......................... 450,000 427,280
(Pooled Capital Program)
7.80% 12/1/05 (FGIC) ............................. 101,000 102,796
(Pratt Institute) 6.00% 7/1/20
(ASSET GTY) ...................................... 500,000 520,135
(State University Educational Facilities)
7.50% 5/15/11 .................................... 400,000 469,592
---------
2,736,124
---------
Hospital Revenue Bonds - 7.09%
New York State Dormitory Authority Revenue
(Millard Fillmore Hospital)
5.375% 2/1/32 (AMBAC) ............................ 450,000 426,825
New York State Dormitory Authority Revenue
(Mental Health) Series D 5.90% 2/15/12 ........... 250,000 263,748
New York State Medical Care Facility Finance
Agency Revenue (Mental Health)
7.70% 2/15/18 .................................... 120,000 121,468
---------
812,041
---------
Housing Revenue Bonds - 8.96%
New York State Mortgage Agency Revenue
(Homeowner Mortgage) Series 88
6.25% 4/1/30 (AMT) ............................... 1,000,000 1,025,100
---------
1,025,100
---------
<PAGE>
Principal Market
Amount Value
--------------------------------------------------------------------------------
Municipal Bonds (continued)
Industrial Development Revenue Bonds - 8.14%
New York City Industrial Development Agency
(Brooklyn Navy Yard Cogen Partners)
5.75% 10/1/36 (AMT) .............................. $450,000 $ 409,567
New York City Industrial Development Agency
(British Airways) 5.25% 12/1/32 (AMT) ............ 600,000 522,462
---------
932,029
---------
*Pre-Refunded Bonds - 22.16%
New York City General Obligation Series F
8.25% 11/15/17-01 ................................ 690,000 731,517
New York State Local Government Assistance
Corporation Series B 7.50% 4/1/20-01 ............. 600,000 622,824
New York State Thruway Authority Service
Contract Revenue (Local Highway & Bridge)
6.25% 4/1/14-05 .................................. 500,000 546,745
New York State Urban Development
Corporation Revenue (Correctional Facilities)
Series 3 7.375% 1/1/18-02 ........................ 600,000 635,034
---------
2,536,120
---------
Territorial Revenue Bonds - 4.17%
Puerto Rico Commonwealth Highway &
Transportation Authority (Highway Revenue)
Series Y 5.50% 7/1/36 ............................ 475,000 477,959
---------
477,959
---------
Transportation Revenue Bonds - 13.00%
Metropolitan Transportation Authority New York
Service Contract (Commuter Facilities)
Series 0 5.75% 7/1/13 ............................ 400,000 419,220
Metropolitan Transportation Authority New York
Dedicated Tax Series A
6.125% 4/1/17 (FGIC) ............................. 1,000,000 1,068,220
----------
1,487,440
----------
Water & Sewer Revenue Bonds - 2.21%
New York City Municipal Water Finance
Authority Water & Sewer System Series B
5.75% 6/15/29 .................................... 250,000 252,785
----------
252,785
----------
Total Municipal Bonds
(cost $10,985,554) ............................... 11,229,305
----------
13
<PAGE>
Statements of Net Assets (continued)
Number of Market
Delaware Tax-Free New York Fund Shares Value
--------------------------------------------------------------------------------
Short-Term Investments - 0.08%
Wells Fargo National Tax-Free Money
Market Fund ...................................... 9,611 $9,611
-----------
Total Short-Term Investments
(cost $9,611) .................................... 9,611
-----------
Total Market Value of Securities - 98.20%
(cost $10,995,165) ............................... 11,238,916
Receivables and Other Assets
Net of Liabilities - 1.80% ....................... 205,526
-----------
Net Assets Applicable to 1,165,253
Shares Outstanding ............................... $11,444,442
===========
Net Asset Value - Delaware Tax-Free
New York Fund A Class
($10,082,019 / 1,026,301 Shares) ................. $9.82
-----
Net Asset Value - Delaware Tax- Free
New York Fund B Class
($1,296,903 / 132,265 Shares) .................... $9.81
-----
Net Asset Value - Delaware Tax-Free
New York Fund C Class
($65,520 / 6,687 Shares) ......................... $9.80
-----
------------------------------
*For Pre-Refunded Bonds, the stated maturity is followed by the year in which
each bond is pre-refunded.
<PAGE>
--------------------------------------------------------------------------------
Components of Net Assets at August 31, 2000:
Shares of beneficial interest
(unlimited authorization - no par) ............... $11,738,020
Accumulated net realized loss on investments ........ (537,329)
Net unrealized appreciation of investments .......... 243,751
-----------
Total net assets .................................... $11,444,442
===========
------------------------------
Summary of Abbreviations:
ASSET GTY - Insured by Asset Guaranty Insurance Company
AMBAC - Insured by the
AMBAC Indemnity Corporation
AMT - Subject to Alternative Minimum Tax
FGIC - Insured by the Financial Guaranty Insurance Company
Net Asset Value and Offering Price per Share -
Delaware Tax-Free New York Fund
Net asset value A Class (A) ......................... $9.82
Sales charge (3.75% of offering price or
3.87% of amount invested per share) (B) .......... 0.38
------
Offering price ...................................... $10.20
======
(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
14
<PAGE>
Statements of Operations
<TABLE>
<CAPTION>
Delaware Delaware Delaware
Tax-Free Tax-Free Florida Tax-Free
Year Ended August 31, 2000 Florida Fund Insured Fund New York Fund
----------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Investment Income:
Interest ........................................... $839,066 $7,113,222 $701,027
------------------------------------------
Expenses:
Management fees .................................... 78,749 603,710 63,685
Distribution expense ............................... 69,722 340,347 39,691
Dividend disbursing and transfer agent fees and
expenses ......................................... 16,075 114,523 16,800
Registration fees .................................. 1,944 -- 7,750
Reports and statements to shareholders ............. 4,652 46,780 6,708
Accounting and administration ...................... 6,515 49,473 4,692
Custodian fees ..................................... 2,694 1,100 1,805
Professional fees .................................. 6,735 84,604 4,125
Taxes (other than taxes on income) ................. 1,630 -- 2,820
Trustees' fees ..................................... 600 477 900
Other .............................................. 1,800 8,798 5,998
------------------------------------------
191,116 1,249,812 154,974
Less expenses absorbed or waived ................... (49,389) (122,338) (86,139)
Less expenses paid indirectly ...................... (329) (2,778) (265)
------------------------------------------
Total operating expenses ........................... 141,398 1,124,696 68,570
Interest expense ................................... 246 9,006 153
-------------------------------------------
Total expenses ..................................... 141,644 1,133,702 68,723
-------------------------------------------
Net Investment Income .............................. 697,422 5,979,520 632,304
------------------------------------------
Net Realized and Unrealized Gain (Loss) on Investments:
Net realized loss on investments ................... (974,810) (507,694) (516,600)
Net change in unrealized appreciation/depreciation of
investments ...................................... 706,657 429,075 432,816
------------------------------------------
Net Realized and Unrealized Loss on Investments .... (268,153) (78,619) (83,784)
------------------------------------------
Net Increase in Net Assets Resulting
from Operations .................................. $429,269 $5,900,901 $548,520
==========================================
</TABLE>
See accompanying notes
15
<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
-------------------------------------------------------------------------------------------------------------------------------
Year Ended Year Ended Year Ended
8/31/00 8/31/99 8/31/00 8/31/99 8/31/00 8/31/99
<S> <C> <C> <C> <C> <C> <C>
Increase (Decrease) in Net Assets from Operations:
Net investment income ............................ $697,422 $750,679 $5,979,520 $6,829,844 $632,304 $587,627
Net realized gain (loss) on investments .......... (974,810) (123,698) (507,694) 3,752,953 (516,600) (11,244)
Net change in unrealized
appreciation/depreciation of investments .... 706,657 (972,725) 429,075 (11,471,230) 432,816 (924,826)
------------------------------------------------------------------------------
Net increase (decrease) in net assets
resulting from operations ................... 429,269 (345,744) 5,900,901 (888,433) 548,520 (348,443)
------------------------------------------------------------------------------
Distributions to Shareholders from:
Net investment income:
A Class ..................................... (501,012) (549,061) (5,767,655) (6,646,531) (562,748) (538,857)
B Class ..................................... (177,459) (172,634) (208,057) (181,234) (65,142) (44,901)
C Class ..................................... (18,951) (28,984) (3,537) (2,079) (4,414) (3,869)
Net realized gain on investments:
A Class ..................................... -- (11,362) -- -- -- (24,643)
B Class ..................................... -- (4,026) -- -- -- (1,574)
C Class ..................................... -- (621) -- -- -- (176)
------------------------------------------------------------------------------
(697,422) (766,688) (5,979,249) (6,829,844) (632,304) (614,020)
------------------------------------------------------------------------------
Capital Share Transactions:
Proceeds from shares sold:
A Class ..................................... 1,076,052 4,574,720 1,888,609 4,395,898 482,803 2,613,937
B Class ..................................... 959,690 2,352,953 999,821 1,543,291 374,682 1,443,259
C Class ..................................... 146,663 504,377 -- 109,981 42 59,191
Net asset value of shares issued upon reinvestment
of distributions from net investment income
and net realized gain on investments:
A Class ..................................... 217,066 260,924 1,750,972 1,978,302 376,435 428,293
B Class ..................................... 66,119 61,646 78,958 69,064 42,306 32,257
C Class ..................................... 6,155 11,255 3,359 1,971 4,313 3,986
------------------------------------------------------------------------------
2,471,745 7,765,875 4,721,719 8,098,507 1,280,581 4,580,923
------------------------------------------------------------------------------
Cost of shares repurchased:
A Class ..................................... (3,787,660) (2,654,355) (18,677,031) (19,743,806) (1,285,627) (1,595,227)
B Class ..................................... (1,390,735) (1,015,161) (620,400) (754,885) (544,576) (400,648)
C Class ..................................... (432,622) (298,373) (58,600) -- (49,770) --
------------------------------------------------------------------------------
(5,611,017) (3,967,889) (19,356,031) (20,498,691) (1,879,973) (1,995,875)
------------------------------------------------------------------------------
Increase (decrease) in net assets derived
from capital share transactions ............. (3,139,272) 3,797,986 (14,634,312) (12,400,184) (599,392) 2,585,048
------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets ............ (3,407,425) 2,685,554 (14,712,660) (20,118,461) (683,176) 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 .................................... $13,188,554 $16,595,979 $116,030,503 $130,743,163 $11,444,442 $12,127,618
==============================================================================
</TABLE>
See accompanying notes
16
<PAGE>
Financial Highlights
<TABLE>
<CAPTION>
Selected data for each share of the Fund outstanding
throughout each period were as follows: Delaware Tax-Free Florida Fund A Class
------------------------------------------------------------------------------------------------------------------------------------
Year Year Eight Months Year Year Period
Ended Ended Ended Ended Ended 3/2/95(3) to
8/31/00 8/31/99 8/31/98(1) 12/31/97(2) 12/31/96 12/31/95
<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 .................................... 0.518 0.532 0.374 0.591 0.590 0.470
Net realized and unrealized gain (loss) on investments ... (0.110) (0.688) 0.215 0.523 (0.210) 0.750
---------------------------------------------------------------------
Total from investment operations ......................... 0.408 (0.156) 0.589 1.114 0.380 1.220
---------------------------------------------------------------------
Less dividends and distributions:
Dividends from net investment income ..................... (0.518) (0.532) (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 ........................ (0.518) (0.544) (0.379) (0.614) (0.590) (0.490)
---------------------------------------------------------------------
Net asset value, end of period ............................. $10.420 $10.530 $11.230 $11.020 $10.520 $10.730
=====================================================================
Total return(4) ............................................ 4.11% (1.50%) 5.44% 10.93% 3.74% 12.49%
Ratios and supplemental data:
Net assets, end of period (000 omitted) .................. $8,711 $11,406 $9,988 $7,506 $5,761 $4,421
Ratio of expenses to average net assets .................. 0.75% 0.62% 0.55% 0.56% 0.33% 0.32%
Ratio of expenses to average net assets prior to expense
limitation and expenses paid indirectly ................ 1.10% 1.16% 1.10% 1.11% 1.25% 1.25%
Ratio of net investment income to average net assets ..... 5.11% 4.81% 4.92% 5.53% 5.66% 5.26%
Ratio of net investment income to average net assets prior
to expense limitation and expenses paid indirectly ..... 4.76% 4.27% 4.37% 4.98% 4.74% 4.33%
Portfolio turnover ....................................... 64% 30% 20% 19% 70% 64%
</TABLE>
---------------------------------------
(1) Ratios have been annualized and total return has not been annualized.
(2) Commencing May 1, 1997, Delaware Management Company replaced Voyageur Fund
Managers, Inc. as the Fund's investment manager.
(3) Commencement of operations; ratios have been annualized and total return has
not been annualized.
(4) 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.
See accompanying notes
17
<PAGE>
Financial Highlights (continued)
<TABLE>
<CAPTION>
Selected data for each share of the Fund outstanding
throughout each period were as follows: Delaware Tax-Free Florida Fund B Class
------------------------------------------------------------------------------------------------------------------------------------
Year Year Eight Months Year Year Period
Ended Ended Ended Ended Ended 9/15/95(3) to
8/31/00 8/31/99 8/31/98(1) 12/31/97(2) 12/31/96 12/31/95
<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 ..................................... 0.443 0.449 0.318 0.527 0.560 0.150
Net realized and unrealized gain (loss) on investments .... (0.110) (0.688) 0.215 0.531 (0.200) 0.380
---------------------------------------------------------------------
Total from investment operations .......................... 0.333 (0.239) 0.533 1.058 0.360 0.530
---------------------------------------------------------------------
Less dividends and distributions:
Dividends from net investment income ...................... (0.443) (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 ......................... (0.443) (0.461) (0.323) (0.558) (0.560) (0.170)
---------------------------------------------------------------------
Net asset value, end of period .............................. $10.430 $10.540 $11.240 $11.030 $10.530 $10.730
=====================================================================
Total return(4) ............................................. 3.34% (2.24%) 4.91% 10.35% 3.51% 5.10%
Ratios and supplemental data:
Net assets, end of period (000 omitted) ................... $4,045 $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%
Ratio of expenses to average net assets prior to expense
limitation and expenses paid indirectly ................. 1.85% 1.91% 1.85% 1.65% 2.00% 2.00%
Ratio of net investment income to average net assets ...... 4.36% 4.06% 4.17% 4.99% 5.23% 4.88%
Ratio of net investment income to average net assets prior
to expense limitation and expenses paid indirectly ...... 4.01% 3.52% 3.62% 4.44% 3.99% 3.32%
Portfolio turnover 64% 30% 20% 19% 70% 64%
</TABLE>
--------------------------------------
(1) Ratios have been annualized and total return has not been annualized.
(2) Commencing May 1, 1997, Delaware Management Company replaced Voyageur Fund
Managers, Inc. as the Fund's investment manager.
(3) Commencement of operations; ratios have been annualized and total return has
not been annualized.
(4) 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.
See accompanying notes
18
<PAGE>
Financial Highlights (continued)
<TABLE>
<CAPTION>
Selected data for each share of the Fund outstanding
throughout each period were as follows: Delaware Tax-Free Florida Fund C Class
------------------------------------------------------------------------------------------------------------------------------------
Year Year Eight Months Year Year Period
Ended Ended Ended Ended Ended 4/22/95(3) to
8/31/00 8/31/99 8/31/98(1) 12/31/97(2) 12/31/96 12/31/95
<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 ..................................... 0.446 0.449 0.318 0.511 0.370 0.330
Net realized and unrealized gain (loss) on investments .... (0.110) (0.698) 0.225 0.521 (0.210) 0.560
---------------------------------------------------------------------
Total from investment operations .......................... 0.336 (0.249) 0.543 1.032 0.160 0.890
---------------------------------------------------------------------
Less dividends and distributions:
Dividends from net investment income ...................... (0.446) (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 ......................... (0.446) (0.461) (0.323) (0.532) (0.370) (0.360)
---------------------------------------------------------------------
Net asset value, end of period .............................. $10.420 $10.530 $11.240 $11.020 $10.520 $10.730
=====================================================================
Total return(4) ............................................. 3.38% (2.33%) 5.01% 10.09% 2.97% 8.88%
Ratios and supplemental data:
Net assets, end of period (000 omitted) ................... $433 $722 $554 $133 $16 $9
Ratio of expenses to average net assets ................... 1.50% 1.37% 1.30% 1.31% 1.15% 1.11%
Ratio of expenses to average net assets prior to expense
limitation and expenses paid indirectly ................. 1.85% 1.91% 1.85% 1.86% 2.00% 2.00%
Ratio of net investment income to average net assets ...... 4.36% 4.06% 4.17% 4.78% 4.83% 4.57%
Ratio of net investment income to average net assets prior
to expense limitation and expenses paid indirectly ...... 4.01% 3.52% 3.62% 4.23% 3.98% 3.68%
Portfolio turnover ........................................ 64% 30% 20% 19% 70% 64%
</TABLE>
--------------------------------------
(1) Ratios have been annualized and total return has not been annualized.
(2) Commencing May 1, 1997, Delaware Management Company replaced Voyageur Fund
Managers, Inc. as the Fund's investment manager.
(3) Commencement of operations; ratios have been annualized and total return has
not been annualized.
(4) 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.
See accompanying notes
19
<PAGE>
Financial Highlights (continued)
<TABLE>
<CAPTION>
Selected data for each share of the Fund outstanding
throughout each period were as follows: Delaware Tax-Free Florida Insured Fund A Class
-----------------------------------------------------------------------------------------------------------------------------------
Year Year Eight Months Year Year Year
Ended Ended Ended Ended Ended Ended
8/31/00 8/31/99 8/31/98(1) 12/31/97(2) 12/31/96 12/31/95
<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 .................................... 0.525 0.537 0.355 0.548 0.530 0.540
Net realized and unrealized gain (loss) on investments ... 0.020 (0.620) 0.130 0.536 (0.230) 1.440
---------------------------------------------------------------------
Total from investment operations ......................... 0.545 (0.083) 0.485 1.084 0.300 1.980
---------------------------------------------------------------------
Less dividends:
Dividends from net investment income ..................... (0.525) (0.537) (0.355) (0.554) (0.530) (0.560)
---------------------------------------------------------------------
Total dividends .......................................... (0.525) (0.537) (0.355) (0.554) (0.530) (0.560)
---------------------------------------------------------------------
Net asset value, end of period ............................. $10.770 $10.750 $11.370 $11.240 $10.710 $10.940
=====================================================================
Total return(3) ............................................ 5.29% (0.83%) 4.38% 10.42% 2.90% 21.22%
Ratios and supplemental data:
Net assets, end of period (000 omitted) .................. $110,708 $125,838 $146,659 $162,097 $192,171 $242,425
Ratio of expenses to average net assets .................. 0.91% 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 ................ 1.01% 0.85% 1.05% 0.85% 0.96% 0.95%
Ratio of net investment income to average net assets ..... 4.98% 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 ..... 4.88% 4.77% 4.54% 5.01% 4.79% 4.80%
Portfolio turnover ....................................... 56% 25% 13% 15% 57% 101%
</TABLE>
---------------------------------------
(1) Ratios have been annualized and total return has not been annualized.
(2) Commencing May 1, 1997, Delaware Management Company replaced Voyageur Fund
Managers, Inc. as the Fund's investment manager.
(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.
See accompanying notes
20
<PAGE>
Financial Highlights (continued)
<TABLE>
<CAPTION>
Delaware Tax-Free Delaware Tax-Free
Selected data for each share of the Fund Florida Insured Fund Florida Insured Fund
outstanding throughout each period were as follows: B Class C Class
-----------------------------------------------------------------------------------------------------------------------------------
Year Year Eight Months Year Year Year Year Period
Ended Ended Ended Ended Ended Ended Ended 1/8/99 to
8/31/00 8/31/99 8/31/98(1) 12/31/97(2) 12/31/96 12/31/95 8/31/00 8/31/99(3)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period ....... $10.750 $11.370 $11.230 $10.710 $10.940 $9.520 $10.760 $11.370
Income (loss) from investment operations:
Net investment income .................... 0.448 0.452 0.299 0.477 0.480 0.500 0.454 0.286
Net realized and unrealized gain (loss)
on investments ......................... 0.016 (0.620) 0.139 0.523 (0.230) 1.440 0.010 (0.610)
------------------------------------------------------------------------------------
Total from investment operations ......... 0.464 (0.168) 0.438 1.000 0.250 1.940 0.464 (0.324)
------------------------------------------------------------------------------------
Less dividends:
Dividends from net investment income ..... (0.444) (0.452) (0.298) (0.480) (0.480) (0.520) (0.444) (0.286)
------------------------------------------------------------------------------------
Total dividends .......................... (0.444) (0.452) (0.298) (0.480) (0.480) (0.520) (0.444) (0.286)
------------------------------------------------------------------------------------
Net asset value, end of period ............. $10.770 $10.750 $11.370 $11.230 $10.710 $10.940 $10.780 $10.760
=====================================================================================
Total return(4) ............................ 4.50% (1.58%) 3.95% 9.58% 2.40% 20.76% 4.49% (2.91%)
Ratios and supplemental data:
Net assets, end of period (000 omitted) .. $5,272 $4,799 $4,202 $3,943 $3,222 $2,814 $51 $107
Ratio of expenses to average net assets .. 1.66% 1.60% 1.62% 1.46% 1.24% 0.89% 1.66% 1.60%
Ratio of expenses to average net assets
prior to expense limitation and
expenses paid indirectly ............... 1.76% 1.60% 1.80% 1.52% 1.72% 1.68% 1.76% 1.60%
Ratio of net investment income to average
net assets ............................. 4.23% 4.02% 3.97% 4.40% 4.51% 4.80% 4.23% 4.02%
Ratio of net investment income to average
net assets prior to expense limitation
and expenses paid indirectly ........... 4.13% 4.02% 3.79% 4.34% 4.03% 4.01% 4.13% 4.02%
Portfolio turnover ....................... 56% 25% 13% 15% 57% 101% 56% 25%
</TABLE>
----------------------
(1) Ratios have been annualized and total return has not been annualized.
(2) Commencing May 1, 1997, Delaware Management Company replaced Voyageur Fund
Managers, Inc. as the Fund's investment manager.
(3) 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
insignificance. Ratios have been annualized and total return has not been
annualized.
(4) 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.
See accompanying notes
21
<PAGE>
Financial Highlights (continued)
<TABLE>
<CAPTION>
Selected data for each share of the Fund outstanding
throughout each period were as follows: Delaware Tax-Free New York Fund A Class
------------------------------------------------------------------------------------------------------------------------------------
Year Year Eight Months Year Three Months Year Year
Ended Ended Ended Ended Ended Ended Ended
8/31/00 8/31/99 8/31/98(1) 12/31/97(2) 12/31/96(3) 9/30/96 9/30/95
<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 ....................... 0.535 0.523 0.362 0.603 0.120 0.550 0.570
Net realized and unrealized gain (loss)
on investments ............................ (0.060) (0.766) 0.040 0.128 0.010 (0.130) 0.170
----------------------------------------------------------------------------------
Total from investment operations ............ 0.475 (0.243) 0.402 0.731 0.130 0.420 0.740
----------------------------------------------------------------------------------
Less dividends and distributions:
Dividends from net investment income ........ (0.535) (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 ........... (0.535) (0.547) (0.372) (0.781) (0.160) (0.570) (0.610)
----------------------------------------------------------------------------------
Net asset value, end of period ................ $9.820 $9.880 $10.670 $10.640 $10.690 $10.720 $10.870
==================================================================================
Total return(4) ............................... 5.09% (2.44%) 3.85% 7.09% 1.21% 3.94% 7.31%
Ratios and supplemental data:
Net assets, end of period (000 omitted) ..... $10,082 $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% 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% 1.55% 1.82%
Ratio of net investment income to average
net assets ................................ 5.58% 4.99% 5.12% 5.66% 5.31% 5.14% 5.66%
Ratio of net investment income to average
net assets prior to expense limitation and
expenses paid indirectly .................. 4.83% 4.46% 4.97% 5.27% 5.16% 4.93% 5.15%
Portfolio turnover .......................... 34% 21% 21% 30% 5% 12% 10%
</TABLE>
----------------------
(1) Ratios have been annualized and total return has not been annualized.
(2) Commencing May 1, 1997, Delaware Management Company replaced Voyageur Fund
Managers, Inc. as the Fund's investment manager.
(3) Effective November 16, 1996, the Fund's shareholders approved a change of
investment advisor from Fortis Advisers, Inc. to Voyageur Fund Managers,
Inc. Ratios have been annualized and total return has not been annualized.
(4) 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.
See accompanying notes
22
<PAGE>
Financial Highlights (continued)
<TABLE>
<CAPTION>
Selected data for each share of the Fund outstanding
throughout each period were as follows: Delaware Tax-Free New York Fund B Class
------------------------------------------------------------------------------------------------------------------------------------
Year Year Eight Months Year Three Months Year Period
Ended Ended Ended Ended Ended Ended 11/14/94(4)
8/31/00 8/31/99 8/31/98(1) 12/31/97(2) 12/31/96(3) 9/30/96 to 9/30/95
<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 ....................... 0.462 0.445 0.311 0.524 0.100 0.470 0.430
Net realized and unrealized gain (loss) on
investments ............................... (0.050) (0.766) 0.049 0.136 -- (0.130) 0.540
----------------------------------------------------------------------------------
Total from investment operations ............ 0.412 (0.321) 0.360 0.660 0.100 0.340 0.970
----------------------------------------------------------------------------------
Less dividends and distributions:
Dividends from net investment income ........ (0.462) (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 ........... (0.462) (0.469) (0.320) (0.700) (0.140) (0.490) (0.470)
----------------------------------------------------------------------------------
Net asset value, end of period ................ $9.810 $9.860 $10.650 $10.610 $10.650 $10.690 $10.840
==================================================================================
Total return(5) ............................... 4.41% (3.18%) 3.44% 6.39% 0.95% 3.14% 9.46%
Ratios and supplemental data:
Net assets, end of period (000 omitted) ..... $1,297 $1,435 $469 $167 $254 $448 $266
Ratio of expenses to average net assets ..... 1.25% 1.41% 1.75% 1.75% 1.87% 2.09% 2.09%
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% 2.30% 2.60%
Ratio of net investment income to average
net assets ................................ 4.83% 4.24% 4.37% 4.91% 4.43% 4.39% 4.68%
Ratio of net investment income to average
net assets prior to expense limitation
and expenses paid indirectly .............. 4.08% 3.71% 4.22% 4.52% 4.30% 4.18% 4.17%
Portfolio turnover .......................... 34% 21% 21% 30% 5% 12% 10%
</TABLE>
----------------------
(1) Ratios have been annualized and total return has not been annualized.
(2) Commencing May 1, 1997, Delaware Management Company replaced Voyageur Fund
Managers, Inc. as the Fund's investment manager.
(3) Effective November 16, 1996, the Fund's shareholders approved a change of
investment advisor from Fortis Advisers, Inc. to Voyageur Fund Managers,
Inc. Ratios have been annualized and total return has not been annualized.
(4) Commencement of operations; ratios have been annualized and total return has
not been annualized.
(5) 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.
See accompanying notes
23
<PAGE>
Financial Highlights (continued)
<TABLE>
<CAPTION>
Selected data for each share of the Fund outstanding
throughout each period were as follows: Delaware Tax-Free New York Fund C Class
------------------------------------------------------------------------------------------------------------------------------------
Year Year Eight Months Year Three Months Year Period
Ended Ended Ended Ended Ended Ended 4/26/95(4)
8/31/00 8/31/99 8/31/98(1) 12/31/97(2) 12/31/96(3) 9/30/96 to 9/30/95
<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 ....................... 0.462 0.445 0.308 0.522 0.100 0.470 0.210
Net realized and unrealized gain (loss)
on investments ............................ (0.060) (0.756) 0.042 0.128 -- (0.130) 0.060
----------------------------------------------------------------------------------
Total from investment operations ............ 0.402 (0.311) 0.350 0.650 0.100 0.340 0.270
----------------------------------------------------------------------------------
Less dividends and distributions:
Dividends from net investment income ........ (0.462) (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 ........... (0.462) (0.469) (0.320) (0.700) (0.140) (0.490) (0.210)
----------------------------------------------------------------------------------
Net asset value, end of period ................ $9.800 $9.860 $10.640 $10.610 $10.660 $10.700 $10.850
==================================================================================
Total return(5) ............................... 4.31% (3.08%) 3.35% 6.29% 0.95% 3.14% 2.54%
Ratios and supplemental data:
Net assets, end of period (000 omitted) ..... $66 $112 $58 $56 $53 $52 $51
Ratio of expenses to average net assets ..... 1.25% 1.41% 1.75% 1.75% 1.84% 2.09% 2.09%
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% 2.30% 2.60%
Ratio of net investment income to average
net assets ............................... 4.83% 4.24% 4.37% 4.91% 4.45% 4.39% 4.44%
Ratio of net investment income to average net
assets prior to expense limitation and
expenses paid indirectly .................. 4.08% 3.71% 4.22% 4.52% 4.29% 4.18% 3.93%
Portfolio turnover .......................... 34% 21% 21% 30% 5% 12% 10%
</TABLE>
----------------------
(1) Ratios have been annualized and total return has not been annualized.
(2) Commencing May 1, 1997, Delaware Management Company replaced Voyageur Fund
Managers, Inc. as the Fund's investment manager.
(3) Effective November 16, 1996, the Fund's shareholders approved a change of
investment advisor from Fortis Advisers, Inc. to Voyageur Fund Managers,
Inc. Ratios have been annualized and total return has not been annualized.
(4) Commencement of operations; ratios have been annualized and total return has
not been annualized.
(5) 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.
See accompanying notes
23
<PAGE>
Notes to Financial Statements
August 31, 2000
--------------------------------------------------------------------------------
Delaware Tax-Free Florida Fund and Delaware Tax-Free Florida Insured Fund are
series of the Voyageur Investment Trust, which is organized as a Massachusetts
business trust. Delaware Tax-Free New York Fund is a series of Voyageur Mutual
Funds, which is organized as a Delaware business trust. Each series is referred
to as a "Fund" or collectively as the "Funds". The Funds are non-diversified
open-end management investment companies under the Investment Company Act of
1940 as amended. 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 back-end
deferred sales charge and the C Class carries a level load deferred sales
charge.
Delaware Tax-Free Florida Fund, Delaware Tax-Free Florida Insured Fund, and
Delaware Tax-Free New York Fund seek as high a level of current income exempt
from federal income tax and from the personal income tax in their respective
states, as is consistent with preservation of capital.
1. Significant Accounting Policies
The following accounting policies are in accordance with accounting principles
generally accepted in the United States 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 accounting
principles generally accepted in the United States.
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
accounting principles generally accepted in the United States 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 commission arrangements with
brokers. These transactions are done subject to best execution. The amount of
these expenses for the year ended August 31, 2000 were:
Tax-Free Tax-Free Tax-Free
Florida Fund Florida Insured Fund New York Fund
------------ -------------------- --------------
$329 $2,778 $265
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, each Fund
pays 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%
25
<PAGE>
Notes to Financial Statements (continued)
August 31, 2000
--------------------------------------------------------------------------------
2. Investment Management and Other Transactions with Affiliates
(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 October 31, 2001:
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, accounting and
administrative 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 August 31, 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 payable
to DMC $11,721 -- --
Dividend
disbursing,
transfer agent
fees, accounting
services and
other expenses
payable to DSC 2,254 2,813 2,344
Other expenses
payable to DMC
and affiliates 3,422 1,138 6,206
<PAGE>
For the year ended August 31, 2000, DDLP earned commissions on sales of the Fund
A Class shares for each Fund as follows:
Tax-Free Tax-Free Florida Tax-Free
Florida Fund Insured Fund New York Fund
------------ ---------------- -------------
$1,330 $4,479 $1,030
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 year ended August 31, 2000, the Funds made purchases and sales of
investment securities other than temporary cash investments for each Fund as
follows:
Tax-Free Tax-Free Florida Tax-Free
Florida Fund Insured Fund New York Fund
------------ ----------------- -------------
Purchases $8,967,537 $66,489,767 $3,817,859
Sales 11,782,774 80,217,000 4,184,302
At August 31, 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 $12,570,402 $112,902,058 $10,995,165
---------------------------------------------------
Aggregate
unrealized
appreciation $495,914 $4,029,999 $437,125
Aggregate unrealized
depreciation (21,750) (1,464,884) (193,374)
---------------------------------------------------
Net unrealized
appreciation
(depreciation) $474,164 $2,565,115 $243,751
---------------------------------------------------
For federal income tax purposes, each Fund had accumulated capital losses as of
August 31, 2000, which may be carried forward and applied against future capital
gains. Delaware Tax-Free Florida Fund had a capital loss carryover of $17,781
that will expire in 2007 and $327,067 that will expire in 2008. Delaware
Tax-Free Florida Insured Fund had a capital loss carryover of $5,342,463 that
will expire in 2003, $735,445 that will expire in 2004 and $507,694 that will
expire in 2008. Delaware Tax-Free New York Fund had a capital loss carryover of
$20,074 that will expire in 2008.
26
<PAGE>
Notes to Financial Statements (continued)
August 31, 2000
--------------------------------------------------------------------------------
4. Capital Shares
Transactions in capital shares were as follows:
Tax-Free Florida Fund
-------------------------
Year Ended
8/31/00 8/31/99
------- -------
Shares sold:
Class A ......................................... 105,866 411,029
Class B ......................................... 94,252 210,129
Class C ......................................... 14,647 45,217
Shares issued upon reinvestment of
distributions from net investment income
and net realized gains on investments:
Class A ......................................... 21,309 23,627
Class B ......................................... 6,480 5,623
Class C ......................................... 603 1,021
------- -------
243,157 696,646
------- -------
Shares repurchased:
Class A ......................................... (374,556) (240,238)
Class B ......................................... (136,934) (91,522)
Class C ......................................... (42,229) (26,950)
------- -------
(553,719) (358,710)
------- -------
Net increase (decrease) ........................... (310,562) 337,936
======= =======
Tax-Free Florida Insured Fund
-----------------------------
Year Ended
8/31/00 8/31/99
------- -------
Shares sold:
Class A ....................................... 180,236 388,751
Class B ....................................... 94,190 136,924
Class C ....................................... -- 9,723
Shares issued upon reinvestment of
distributions from net investment income
and net realized gains on investments:
Class A ....................................... 166,282 175,844
Class B ....................................... 7,496 6,149
Class C ....................................... 319 178
------- -------
448,523 717,569
------- -------
Shares repurchased:
Class A ....................................... (1,774,772) (1,755,957)
Class B ....................................... (58,780) (66,242)
Class C ....................................... (5,544) --
--------- ---------
(1,839,096) (1,822,199)
--------- ---------
Net increase (decrease) ......................... (1,390,573) (1,104,630)
========= =========
<PAGE>
Tax-Free New York Fund
----------------------
Year Ended
8/31/00 8/31/99
------- -------
Shares sold:
Class A ....................................... 50,531 247,644
Class B ....................................... 39,792 137,868
Class C ....................................... 4 5,576
Shares issued upon reinvestment of
distributions from net investment income
and net realized gains on investments:
Class A ....................................... 39,288 40,908
Class B ....................................... 4,425 3,107
Class C ....................................... 452 383
------- -------
134,492 435,486
------- -------
Shares repurchased:
Class A ....................................... (134,281) (153,072)
Class B ....................................... (57,461) (39,547)
Class C ....................................... (5,172) --
------- -------
(196,914) (192,619)
------- -------
Net increase (decrease) ......................... (62,422) 242,867
======= =======
5. Lines of Credit
The Funds, along with certain other funds in the Delaware Investments Family of
Funds ("the Participants"), participate in a $375,400,000 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 funds' allocation of the entire facility. The Participants may
borrow up to a maximum of one-third of their net assets under the agreement. The
Funds had no amounts outstanding as of August 31, 2000, or at any time during
the period.
6. Credit and Market Risk
The Funds concentrate their investments in securities issued by municipalities,
mainly in Florida for Delaware Tax-Free Florida Fund and Delaware Tax-Free
Florida Insured Fund and in New York for Delaware 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.
27
<PAGE>
Notes to Financial Statements (continued)
August 31, 2000
--------------------------------------------------------------------------------
7. Tax Information (Unaudited)
The information set forth is for each Fund's fiscal year as required by federal
laws. Shareholders, however, report distributions on a calendar year basis for
income tax purposes, which may include distributions for portions of two fiscal
years of a fund. Accordingly, the information needed by shareholders for income
tax purposes will be sent to them in early 2001. Please consult your tax advisor
for proper treatment of this information.
For the fiscal year ended August 31, 2000, each Fund designates as
long-term capital gains, ordinary income and tax-exempt income distributions
paid during the year as follows:
(A) (B)
Long-Term Ordinary
Capital Gains Income
Distributions Distributions
------------- -------------
Delaware Tax-Free Florida Fund .................. -- --
Delaware Tax-Free
Florida Insured Fund .......................... -- --
Delaware Tax-Free New York Fund ................. -- --
(D)
(C) Total
Tax-Exempt Distributions
Distributions (Tax Basis)
------------- -------------
Delaware Tax-Free Florida Fund .................. 100% 100%
Delaware Tax-Free
Florida Insured Fund .......................... 100% 100%
Delaware Tax-Free New York Fund ................. 100% 100%
------------------
(A), (B) and (C) are based on a percentage of the Fund's total distributions.
28
<PAGE>
Report of Independent Auditors
--------------------------------------------------------------------------------
To the Shareholders and Board of Trustees
Voyageur Investment Trust - Delaware Tax-Free Florida Fund
Voyageur Investment Trust - Delaware Tax-Free Florida Insured Fund
Voyageur Mutual Funds - Delaware Tax-Free New York Fund
We have audited the accompanying statements of net assets of Delaware Tax-Free
Florida Fund, Delaware Tax-Free Florida Insured Fund and Delaware Tax-Free New
York Fund (the "Funds") as of August 31, 2000, and the related statements of
operations for the year then ended, the statements of changes in net assets for
each of the two years in the period then ended, and the financial highlights for
each of the periods presented from January 1, 1997 through August 31, 2000.
These financial statements and financial highlights are the responsibility of
the Funds' management. Our responsibility is to express an opinion on these
financial statements and financial highlights based on our audits. The financial
highlights for the periods presented through December 31, 1996 were audited by
other auditors whose reports thereon dated February 14, 1997 expressed
unqualified opinions on such financial highlights.
We conducted our audits in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements and
financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements and financial highlights. Our procedures included
confirmation of securities owned as of August 31, 2000, by correspondence with
the custodian and brokers. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of each
of the above listed funds at August 31, 2000, the results of their operations
for the year then ended, the changes in their net assets for each of the two
years in the period then ended, and their financial highlights for each of the
periods presented from January 1, 1997 through August 31, 2000, in conformity
with accounting principles generally accepted in the United States.
/s/ Ernst & Young LLP
Philadelphia, Pennsylvania
October 6, 2000
29
<PAGE>
DELAWARE(SM) For Shareholders
INVESTMENTS 1.800.523.1918
-----------
Philadelphia o London For Securities Dealers
1.800.362.7500
For Financial Institutions
Representatives Only
1.800.659.2265
www.delawareinvestments.com
This 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 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. AFFILIATED OFFICERS Delaware Distributors, L.P.
King of Prussia, PA Philadelphia, PA
Charles E. Haldeman, Jr.
David K. Downes President and Chief Executive Officer Shareholder Servicing, Dividend
President and Chief Executive Officer Delaware Management Holdings, Inc. Disbursing and Transfer Agent
Delaware Investments Family of Funds Philadelphia, PA Delaware Service Company, Inc.
Philadelphia, PA Philadelphia, PA
Richard J. Flannery
John H. Durham Executive Vice President 1818 Market Street
Private Investor and General Counsel Philadelphia, PA 19103-3682
Horsham, PA Delaware Investments Family of Funds
Philadelphia, PA
Anthony D. Knerr
Consultant, Anthony Knerr & Associates Bruce D. Barton
New York, NY President and Chief Executive Officer
Delaware Distributors, L.P.
Ann R. Leven Philadelphia, PA
Former Treasurer, National Gallery of Art
Washington, DC
Thomas F. Madison
President and Chief Executive Officer
MLM Partners, Inc.
Minneapolis, MN
</TABLE>
(3875) Printed in the USA
AR-FLNY [08/00] PPL 10/00 (J6382)
