SPARTAN(REGISTERED TRADEMARK)
NEW JERSEY MUNICIPAL
FUNDS
AND
FIDELITY (REGISTERED TRADEMARK)
NEW JERSEY MUNICIPAL
MONEY MARKET FUND
ANNUAL REPORT
NOVEMBER 30, 1999
(2_FIDELITY_LOGOS)(registered trademark)
CONTENTS
PRESIDENT'S MESSAGE 3 NED JOHNSON ON INVESTING
STRATEGIES
SPARTAN NEW JERSEY MUNICIPAL
INCOME FUND
4 PERFORMANCE
7 FUND TALK: THE MANAGER'S
OVERVIEW
10 INVESTMENT CHANGES
11 INVESTMENTS
19 FINANCIAL STATEMENTS
SPARTAN NEW JERSEY MUNICIPAL
MONEY MARKET FUND
23 PERFORMANCE
25 FUND TALK: THE MANAGER'S
OVERVIEW
27 INVESTMENT CHANGES
28 INVESTMENTS
35 FINANCIAL STATEMENTS
FIDELITY NEW JERSEY MUNICIPAL
MONEY MARKET FUND
39 PERFORMANCE
41 FUND TALK: THE MANAGER'S
OVERVIEW
43 INVESTMENT CHANGES
44 INVESTMENTS
51 FINANCIAL STATEMENTS
NOTES 55 NOTES TO THE FINANCIAL
STATEMENTS
REPORT OF INDEPENDENT 60 THE AUDITORS' OPINION
ACCOUNTANTS
PROXY VOTING RESULTS 61
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This report is printed on recycled paper using soy-based inks.
THIS REPORT AND THE FINANCIAL STATEMENTS CONTAINED HEREIN ARE
SUBMITTED FOR THE GENERAL
INFORMATION OF THE SHAREHOLDERS OF THE FUNDS. THIS REPORT IS NOT
AUTHORIZED FOR DISTRIBUTION TO
PROSPECTIVE INVESTORS IN THE FUNDS UNLESS PRECEDED OR ACCOMPANIED BY
AN EFFECTIVE PROSPECTUS.
MUTUAL FUND SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED
BY, ANY DEPOSITORY INSTITUTION. SHARES ARE NOT INSURED BY THE FDIC,
FEDERAL RESERVE BOARD OR ANY OTHER AGENCY, AND ARE SUBJECT TO
INVESTMENT RISKS, INCLUDING POSSIBLE LOSS OF PRINCIPAL AMOUNT
INVESTED.
NEITHER THE FUNDS NOR FIDELITY DISTRIBUTORS CORPORATION IS A BANK.
FOR MORE INFORMATION ON ANY FIDELITY FUND, INCLUDING CHARGES AND
EXPENSES, CALL 1-800-544-6666
FOR A FREE PROSPECTUS. READ IT CAREFULLY BEFORE YOU INVEST OR SEND
MONEY.
PRESIDENT'S MESSAGE
(PHOTO_OF_EDWARD_C_JOHNSON_3D)
DEAR SHAREHOLDER:
U.S. equity indexes once again dominated the financial headlines, led
by the NASDAQ's 15 record highs in 21 November sessions. Meanwhile,
the Standard & Poor's 500SM posted two record closings and the Dow
Jones Industrial Average crept above the 11,000 mark for the first
time since mid-September. However, another Federal Reserve Board
interest rate hike and continued inflation concerns drove down the
price of the benchmark 30-year Treasury.
While it's impossible to predict the future direction of the markets
with any degree of certainty, there are certain basic principles that
can help investors plan for their future needs.
The longer your investment time frame, the less likely it is that you
will be affected by short-term market volatility. A 10-year investment
horizon appropriate for saving for a college education, for example,
enables you to weather market cycles in a long-term fund, which may
have a higher risk potential, but also has a higher potential rate of
return.
An intermediate-length fund could make sense if your investment
horizon is two to four years, while a short-term bond fund could be
the right choice if you need your money in one or two years.
If your time horizon is less than a year, you might want to consider
moving some of your bond investment into a money market fund. These
funds seek income and a stable share price by investing in
high-quality, short-term investments. Of course, it's important to
remember that an investment in a money market fund is not insured or
guaranteed by the Federal Deposit Insurance Corporation or any other
government agency. Although money market funds seek to preserve the
value of your investment at $1.00 per share, it is possible to lose
money by investing in these types of funds.
Finally, no matter what your time horizon or portfolio diversity, it
makes good sense to follow a regular investment plan, investing a
certain amount of money in a fund at the same time each month or
quarter and periodically reviewing your overall portfolio. By doing
so, you won't get caught up in the excitement of a rapidly rising
market, nor will you buy all your shares at market highs. While this
strategy - known as dollar cost averaging - won't assure a profit or
protect you from a loss in a declining market, it should help you
lower the average cost of your purchases. Of course, you should
consider your financial ability to continue your purchases through
periods of low price levels before undertaking such a strategy.
If you have questions, please call us at 1-800-544-6666, or visit our
web site at www.fidelity.com. We are available 24 hours a day, seven
days a week to provide you the information you need to make the
investments that are right for you.
Best regards,
Edward C. Johnson 3d
SPARTAN NEW JERSEY MUNICIPAL INCOME FUND
PERFORMANCE: THE BOTTOM LINE
There are several ways to evaluate a fund's historical performance.
You can look at the total percentage change in value, the average
annual percentage change or the growth of a hypothetical $10,000
investment. Total return reflects the change in the value of an
investment, assuming reinvestment of the fund's dividend income and
capital gains (the profits earned upon the sale of securities that
have grown in value). You can also look at income, as reflected in the
fund's yield, to measure performance. If Fidelity had not reimbursed
certain fund expenses, the past 10 year total returns would have been
lower.
CUMULATIVE TOTAL RETURNS
PERIODS ENDED NOVEMBER 30, PAST 1 YEAR PAST 5 YEARS PAST 10 YEARS
1999
SPARTAN NJ MUNICIPAL INCOME -0.65% 39.51% 90.86%
LB New Jersey Municipal Bond -0.30% n/a n/a
with Port Authority of New
York and New Jersey
LB New Jersey 4 Plus Year -0.87% 43.76% n/a
Municipal Bond with Port
Authority of New York and
New Jersey
New Jersey Municipal Debt -3.36% 36.58% 86.92%
Funds Average
CUMULATIVE TOTAL RETURNS show the fund's performance in percentage
terms over a set period - in this case, one year, five years or 10
years. For example, if you had invested $1,000 in a fund that had a 5%
return over the past year, the value of your investment would be
$1,050. You can compare the fund's returns to the performance of the
Lehman Brothers New Jersey Municipal Bond with Port Authority of New
York and New Jersey Index - a market value-weighted index of New
Jersey investment-grade municipal bonds, including Port Authority of
New York and New Jersey bonds, with maturities of one year or more.
Beginning with this report, the fund will compare itself to the Lehman
Brothers New Jersey 4 Plus Year Municipal Bond Index with Port
Authority of New York and New Jersey, a market value-weighted index of
New Jersey investment-grade municipal bonds, including Port Authority
of New York and New Jersey bonds, with maturities of four years or
more. To measure how the fund's performance stacked up against its
peers, you can compare it to the New Jersey municipal debt funds
average, which reflects the performance of mutual funds with similar
objectives tracked by Lipper Inc. The past one year average represents
a peer group of 59 mutual funds. These benchmarks include reinvested
dividends and capital gains, if any, and exclude the effect of sales
charges.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED NOVEMBER 30, PAST 1 YEAR PAST 5 YEARS PAST 10 YEARS
1999
SPARTAN NJ MUNICIPAL INCOME -0.65% 6.89% 6.68%
LB New Jersey Municipal Bond -0.30% n/a n/a
with Port Authority of New
York and New Jersey
LB New Jersey 4 Plus Year -0.87% 7.53% n/a
Municipal Bond with Port
Authority of New York and
New Jersey
New Jersey Municipal Debt -3.36% 6.43% 6.45%
Funds Average
AVERAGE ANNUAL TOTAL RETURNS take the fund's cumulative return and
show you what would have happened if the fund had performed at a
constant rate each year. (Note: Lipper calculates average annual total
returns by annualizing each fund's total return, then taking an
arithmetic average. This may produce a different figure than that
obtained by averaging the cumulative total returns and annualizing the
result.)
$10,000 OVER 10 YEARS
Spartan NJ Muni Income LB Municipal Bond
00416 LB015
1989/11/30 10000.00 10000.00
1989/12/31 10046.02 10081.80
1990/01/31 9946.22 10034.11
1990/02/28 10047.49 10123.42
1990/03/31 10064.98 10126.45
1990/04/30 9934.15 10053.14
1990/05/31 10193.21 10272.60
1990/06/30 10296.20 10362.89
1990/07/31 10457.46 10515.23
1990/08/31 10255.75 10362.55
1990/09/30 10321.81 10368.45
1990/10/31 10467.93 10556.54
1990/11/30 10715.44 10768.83
1990/12/31 10763.54 10815.67
1991/01/31 10893.99 10960.82
1991/02/28 10963.39 11056.18
1991/03/31 10991.50 11060.16
1991/04/30 11144.31 11207.26
1991/05/31 11235.64 11306.89
1991/06/30 11233.64 11295.70
1991/07/31 11419.12 11433.28
1991/08/31 11554.43 11583.86
1991/09/30 11700.87 11734.68
1991/10/31 11825.74 11840.29
1991/11/30 11854.83 11873.33
1991/12/31 12090.74 12128.13
1992/01/31 12111.03 12155.78
1992/02/29 12117.65 12159.67
1992/03/31 12094.84 12164.17
1992/04/30 12192.23 12272.43
1992/05/31 12369.33 12416.88
1992/06/30 12566.64 12625.23
1992/07/31 13014.83 13003.74
1992/08/31 12833.10 12876.95
1992/09/30 12885.90 12961.16
1992/10/31 12621.79 12833.76
1992/11/30 12960.55 13063.61
1992/12/31 13143.55 13196.99
1993/01/31 13303.89 13350.47
1993/02/28 13822.83 13833.36
1993/03/31 13649.44 13687.14
1993/04/30 13808.10 13825.24
1993/05/31 13920.67 13902.94
1993/06/30 14175.02 14134.98
1993/07/31 14177.92 14153.49
1993/08/31 14509.39 14448.17
1993/09/30 14682.67 14612.73
1993/10/31 14687.97 14640.94
1993/11/30 14531.48 14511.95
1993/12/31 14859.96 14818.30
1994/01/31 15016.04 14987.52
1994/02/28 14572.79 14599.35
1994/03/31 13906.64 14004.86
1994/04/30 13986.62 14123.62
1994/05/31 14145.74 14246.07
1994/06/30 14071.42 14159.03
1994/07/31 14335.50 14418.57
1994/08/31 14391.41 14468.45
1994/09/30 14171.14 14256.06
1994/10/31 13913.37 14002.87
1994/11/30 13680.61 13749.70
1994/12/31 14006.04 14052.33
1995/01/31 14426.06 14453.94
1995/02/28 14760.36 14874.26
1995/03/31 14940.25 15045.17
1995/04/30 14968.98 15062.92
1995/05/31 15326.03 15543.58
1995/06/30 15231.55 15408.35
1995/07/31 15288.51 15554.42
1995/08/31 15415.57 15751.65
1995/09/30 15553.29 15851.36
1995/10/31 15791.14 16081.84
1995/11/30 16013.87 16348.64
1995/12/31 16156.04 16505.75
1996/01/31 16242.47 16630.37
1996/02/29 16167.13 16518.11
1996/03/31 15968.09 16307.01
1996/04/30 15908.60 16260.86
1996/05/31 15893.94 16254.36
1996/06/30 16064.60 16431.37
1996/07/31 16194.29 16580.89
1996/08/31 16178.57 16576.91
1996/09/30 16379.90 16808.99
1996/10/31 16583.34 16999.10
1996/11/30 16874.33 17310.18
1996/12/31 16813.39 17237.48
1997/01/31 16856.33 17270.06
1997/02/28 16982.94 17428.60
1997/03/31 16782.23 17196.27
1997/04/30 16899.12 17340.21
1997/05/31 17125.50 17601.00
1997/06/30 17288.75 17788.45
1997/07/31 17732.97 18281.19
1997/08/31 17572.69 18109.90
1997/09/30 17768.29 18324.86
1997/10/31 17873.57 18442.69
1997/11/30 17961.04 18551.14
1997/12/31 18217.17 18821.80
1998/01/31 18388.12 19016.04
1998/02/28 18376.72 19021.74
1998/03/31 18388.94 19038.48
1998/04/30 18317.31 18952.62
1998/05/31 18570.82 19252.64
1998/06/30 18627.78 19328.49
1998/07/31 18669.32 19377.01
1998/08/31 18957.45 19676.38
1998/09/30 19178.70 19921.55
1998/10/31 19187.90 19921.15
1998/11/30 19211.20 19991.08
1998/12/31 19270.82 20041.45
1999/01/31 19497.79 20279.75
1999/02/28 19380.99 20191.12
1999/03/31 19389.05 20219.19
1999/04/30 19445.42 20269.54
1999/05/31 19317.74 20152.18
1999/06/30 19050.28 19861.98
1999/07/31 19126.98 19934.28
1999/08/31 19030.63 19774.81
1999/09/30 19053.77 19782.91
1999/10/31 18904.96 19568.47
1999/11/30 19085.84 19776.68
IMATRL PRASUN SHR__CHT 19991130 19991213 143947 R00000000000123
$10,000 OVER 10 YEARS: Let's say hypothetically that $10,000 was
invested in Spartan New Jersey Municipal Income Fund on November 30,
1989. As the chart shows, by November 30, 1999, the value of your
investment would have grown to $19,086 - a 90.86% increase on your
initial investment. For comparison, look at how the Lehman Brothers
Municipal Bond Index - a market value-weighted index of
investment-grade municipal bonds with maturities of one year or more -
did over the same period. With dividends and capital gains, if any,
reinvested, the same $10,000 would have grown to $19,777 a 97.77%
increase.
(checkmark)UNDERSTANDING
PERFORMANCE
How a fund did yesterday
is no guarantee of how it will
do tomorrow. Bond prices, for
example, generally move in the
opposite direction of interest
rates. In turn, the share price,
return and yield of a fund that
invests in bonds will vary.
That means if you sell your
shares during a market
downturn, you might lose
money. But if you can ride
out the market's ups and
downs, you may have a gain.
TOTAL RETURN COMPONENTS
YEARS ENDED NOVEMBER 30,
1999 1998 1997 1996 1995
Dividend returns 4.57% 4.98% 5.19% 5.37% 6.40%
Capital returns -5.22% 1.98% 1.25% 0.00% 10.66%
Total returns -0.65% 6.96% 6.44% 5.37% 17.06%
TOTAL RETURN COMPONENTS include both dividend returns and capital
returns. A dividend return reflects the actual dividends paid by the
fund. A capital return reflects both the amount paid by the fund to
shareholders as capital gain distributions and changes in the fund's
share price. Both returns assume the dividends or capital gains, if
any, paid by the fund are reinvested.
DIVIDENDS AND YIELD
PERIODS ENDED NOVEMBER 30, PAST 1 MONTH PAST 6 MONTHS PAST 1 YEAR
1999
Dividends per share 4.36(cents) 26.39(cents) 52.85(cents)
Annualized dividend rate 4.87% 4.79% 4.71%
30-day annualized yield 4.76% - -
30-day annualized 7.94% - -
tax-equivalent yield
DIVIDENDS per share show the income paid by the fund for a set period
and do not reflect tax reclassifications. If you annualize this
number, based on an average share price of $10.90 over the past month,
$11.00 over the past six months and $11.23 over the past one year, you
can compare the fund's income over these three periods. The 30-day
annualized YIELD is a standard formula for all bond funds based on the
yields of the bonds in the fund, averaged over the past 30 days. This
figure shows you the yield characteristics of the fund's investments
at the end of the period. It also helps you compare funds from
different companies on an equal basis. The tax-equivalent yield shows
what you would have to earn on a taxable investment to equal the
fund's tax-free yield, if you're in the 40.08% combined effective 1999
federal and state tax bracket, but does not reflect the payment of the
federal alternative minimum tax, if applicable.
SPARTAN NEW JERSEY MUNICIPAL INCOME FUND
FUND TALK: THE MANAGER'S OVERVIEW
MARKET RECAP
Although November saw the Federal
Reserve Board levy its third 0.25%
interest-rate hike of 1999, the
municipal bond market responded
with its best single-month
performance since January. This
improvement in investor sentiment -
perhaps anticipating that the Fed's
latest rate hike would be its last for
a while - was a key contributor to
the market's improved outlook.
However, for the 12-month period
ending November 30, 1999, munis
overall dwelled in negative territory,
as the Lehman Brothers Municipal
Bond Index - an index of
approximately 50,000
investment-grade, fixed-rate,
tax-exempt bonds - declined
1.07%. A big story throughout the
year was supply, or lack thereof.
Municipal issuance fell 16.9%
through the first three quarters of
1999 compared to the same period
in 1998. Unfortunately, demand
also was tepid as the strong U.S.
economy continued to sway
investors toward higher-yielding -
and higher-risk - alternatives. Late in
the period, though, as the Fed
sought to cool down the economy
and municipal yields became more
attractive, demand showed signs of
improving. In comparison to other
bonds, munis had mixed results.
Municipal performance soundly
trounced Treasuries, as the Lehman
Brothers Long-Term Government
Bond Index fell 7.52% during the
period. Meanwhile, the Lehman
Brothers Aggregate Bond Index - a
broad measure of the taxable
bond market - posted a
marginally negative return of
- -0.04%.
(photograph of Norm Lind)
An interview with Norm Lind, Portfolio Manager of Spartan New Jersey
Municipal Income Fund
Q. HOW DID THE FUND PERFORM, NORM?
A. For the 12-month period that ended November 30, 1999, the fund had
a total return of -0.65%. To get a sense of how the fund did relative
to its competitors, the New Jersey municipal debt funds average
returned -3.36% for the same 12-month period, according to Lipper Inc.
Additionally, the Lehman Brothers New Jersey Municipal Bond Index with
Port Authority of New York and New Jersey - which tracks the types of
securities in which the fund invests- returned -0.30% for the same
12-month period. An additional benchmark, the Lehman Brothers New
Jersey 4 Plus Year Municipal Bond Index with Port Authority of New
York and New Jersey, returned -0.87%. The fund is managed to have
similar overall interest-rate risk to the new benchmark index, which
excludes securities with maturities of less than three years and is
more representative of the fund's investment universe.
Q. RISING INTEREST RATES MADE THE PAST YEAR PRETTY DIFFICULT FOR ALL
BONDS, INCLUDING MUNICIPAL BONDS. WERE THERE ANY TYPES OF MUNICIPALS
THAT HELD UP WELL AGAINST THE UNFAVORABLE BACKDROP?
A. Yes, the fund benefited from its relatively large position in
premium coupon bonds, which pay interest rates above prevailing
markets rates and trade at prices that are above their face - or par -
value. The primary reason why I favored them is because their premium
gives them DE MINIMIS protection. This protects bonds' gains from
unfavorable tax treatment that can occur during particular market
environments. In addition, individual investors tend to shy away from
premiums, so I'm often able to purchase them at attractive prices
compared to similarly rated, comparable maturity bonds with coupons at
or below prevailing rates. Separately, the fund was helped by its
emphasis on high-quality bonds, since certain lower-quality securities
- - namely hospital and industrial development bonds - came under
increased pressure as interest rates rose.
Q. WERE THERE ANY BONDS OR STRATEGIES THAT PROVED PARTICULARLY
DISAPPOINTING DURING THE PERIOD?
A. Some of the state's larger issuers - particularly the New Jersey
Turnpike Authority - floated various proposals to restructure their
debt. Those discussions helped boost the prices of their bonds. While
the fund owned some of these bonds, it didn't own as many as its
competitors.
Q. WHAT CHANGES TO THE FUND'S HOLDINGS DID YOU MAKE SINCE THE LAST
REPORT TO SHAREHOLDERS SIX MONTHS AGO?
A. One change had to do with the shift away from bonds whose fortunes
are tied to the strength of the economy and into less economically
sensitive securities. Given that the more economically sensitive bonds
offer only a small amount of additional yield, there's really no
penalty for getting some measure of protection against a potential
economic slowdown. In particular, I sold some economically sensitive
general obligation bonds, which are backed by income, sales, property
and other taxes. On the flip side, I bought bonds from issuers that
provide essential services, such as water, sewer and transportation.
Q. WHAT'S AHEAD FOR THE MUNICIPAL MARKET?
A. The main factor affecting the future of municipals probably will be
- - as it has been over the past year - the direction of interest rates.
But since I don't spend time on interest-rate forecasting, I'll look
for attractively priced bonds that I believe can perform well in
relation to other bonds, no matter what the interest-rate backdrop.
From a technical standpoint, the municipal market is in reasonably
good shape. Rising interest rates have curtailed the supply of new
issuance, and refundings - or refinancings - of existing debt have
slowed. Given that municipal bonds currently offer attractive values
relative to U.S. Treasury securities, I think we could see better
demand in the months to come. From a more local standpoint, the New
Jersey economy continues to enjoy healthy growth, which bodes well for
the credit quality of bonds issued in the state. That said, I think
that conditions now provide attractive opportunities to buy bonds that
will provide some measure of protection against a slowing economy, if
that were to occur.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO
MANAGER ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON
THE COVER AND DO NOT NECESSARILY REPRESENT THE VIEWS OF FIDELITY OR
ANY OTHER PERSON IN THE FIDELITY ORGANIZATION. ANY SUCH VIEWS ARE
SUBJECT TO CHANGE AT ANY TIME BASED UPON MARKET OR OTHER CONDITIONS
AND FIDELITY DISCLAIMS ANY RESPONSIBILITY TO UPDATE SUCH VIEWS. THESE
VIEWS MAY NOT BE RELIED ON AS INVESTMENT ADVICE AND, BECAUSE
INVESTMENT DECISIONS FOR A FIDELITY FUND ARE BASED ON NUMEROUS
FACTORS, MAY NOT BE RELIED ON AS AN INDICATION OF TRADING INTENT ON
BEHALF OF ANY FIDELITY FUND.
(checkmark)FUND FACTS
GOAL: a high level of current
income exempt from federal
income tax and the New
Jersey Gross Income Tax
FUND NUMBER: 416
TRADING SYMBOL: FNJHX
START DATE: January 1, 1988
SIZE: as of November 30,
1999, more than $380
million
MANAGER: Norm Lind, since
1997; manager, various
Fidelity and Spartan municipal
income funds; joined Fidelity
in 1986
NORM LIND ON SUPPLY AND
DEMAND CHARACTERISTICS OF
THE MUNICIPAL MARKET:
"After the direction of interest
rates, supply and demand is
probably the most important factor
determining municipal bond
performance. As a portfolio
manager, I try to take advantage of
seasonal shifts, selling bonds when
supply is light and prices are fairly
advantageous, and buying when
supply is heavy and prices are
relatively cheap. For example,
municipal supply generally slows
down during the summer when
market participants - such as
investment bankers, dealers,
investors and others - go on
vacation, although supply generally
picks up again in the remaining
months of the year. What's more
interesting, in my view, are demand
patterns. With the help of
Fidelity's research team, I look for
opportunities to exploit changes
in investor activity, buying after
certain types of investors have
unloaded municipal bonds and
prices are attractive, and selling
when there is strong demand."
SPARTAN NEW JERSEY MUNICIPAL INCOME FUND
INVESTMENT CHANGES
TOP FIVE SECTORS AS OF
NOVEMBER 30, 1999
% OF FUND'S NET ASSETS % OF FUND'S NET ASSETS 6
MONTHS AGO
General Obligations 28.0 25.5
Transportation 21.7 22.2
Water & Sewer 13.9 13.2
Health Care 8.5 8.4
Housing 8.2 7.6
AVERAGE YEARS TO MATURITY AS
OF NOVEMBER 30, 1999
6 MONTHS AGO
Years 11.9 12.2
AVERAGE YEARS TO MATURITY IS BASED ON THE AVERAGE TIME REMAINING UNTIL
PRINCIPAL PAYMENTS ARE EXPECTED FROM EACH OF THE FUND'S BONDS,
WEIGHTED BY DOLLAR AMOUNT.
DURATION AS OF NOVEMBER 30,
1999
6 MONTHS AGO
Years 6.4 6.1
DURATION SHOWS HOW MUCH A BOND FUND'S PRICE FLUCTUATES WITH CHANGES IN
COMPARABLE INTEREST RATES. IF RATES RISE 1%, FOR EXAMPLE, A FUND WITH
A FIVE-YEAR DURATION IS LIKELY TO LOSE ABOUT 5% OF ITS VALUE. OTHER
FACTORS ALSO CAN INFLUENCE A BOND FUND'S PERFORMANCE AND SHARE PRICE.
ACCORDINGLY, A BOND FUND'S ACTUAL PERFORMANCE MAY DIFFER FROM THIS
EXAMPLE.
QUALITY DIVERSIFICATION
(MOODY'S RATINGS)
AS OF NOVEMBER 30, 1999
Aaa 44.6%
Aa, A 38.5%
Baa 10.1%
Ba and Below 0.0%
Not Rated 3.6%
Short-term
Investments 3.2%
Row: 1, Col: 1, Value: 44.6
Row: 1, Col: 2, Value: 38.5
Row: 1, Col: 3, Value: 10.1
Row: 1, Col: 4, Value: 0.0
Row: 1, Col: 5, Value: 3.6
Row: 1, Col: 6, Value: 3.2
AS OF MAY 31, 1999
Aaa 47.9%
Aa, A 39.4%
Baa 7.5%
Ba and Below 0.6%
Not Rated 3.5%
Short-term
Investments 1.1%
Row: 1, Col: 1, Value: 47.9
Row: 1, Col: 2, Value: 39.4
Row: 1, Col: 3, Value: 7.5
Row: 1, Col: 4, Value: 0.6000000000000001
Row: 1, Col: 5, Value: 3.5
Row: 1, Col: 6, Value: 1.1
WHERE MOODY'S RATINGS ARE NOT AVAILABLE, WE HAVE USED S&P(registered
trademark) RATINGS. AMOUNTS SHOWN ARE AS A PERCENTAGE OF THE FUND'S
INVESTMENTS.
PRIOR TO THIS REPORT, CERTAIN INFORMATION RELATED TO PORTFOLIO
HOLDINGS WAS STATED AS A PERCENTAGE OF THE FUND'S INVESTMENTS.
SPARTAN NEW JERSEY MUNICIPAL INCOME FUND
INVESTMENTS NOVEMBER 30, 1999
Showing Percentage of Net Assets
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MUNICIPAL BONDS - 95.8%
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT VALUE (NOTE 1)
NEW JERSEY - 85.2%
Atlantic County Impt. Auth.
Luxury Tax Rev. (Convention
Ctr. Proj.):
7.375% 7/1/10 (MBIA Insured) Aaa $ 1,000,000 $ 1,134,210
(Escrowed to Maturity) (e)
7.4% 7/1/16 (MBIA Insured) Aaa 3,510,000 4,169,283
(Escrowed to Maturity) (e)
Atlantic County Util. Auth.
Swr. Rev. Rfdg.:
Series A, 5.85% 1/15/15 Aaa 2,620,000 2,650,078
(AMBAC Insured)
5.25% 1/15/11 (AMBAC Insured) Aaa 4,145,000 4,166,430
Atlantic County Gen. Oblig.
Ctfs. of Prtn. Rfdg. (Pub.
Facilities Lease Agreement
Proj.):
7.4% 3/1/07 (FGIC Insured) Aaa 3,035,000 3,474,954
7.4% 3/1/08 (FGIC Insured) Aaa 3,260,000 3,769,375
Bergen County Utils. Auth.
Wtr. Poll. Cont. Rev.:
Rfdg.:
(Cap. Appreciation) Series B, Aaa 7,500,000 5,022,674
0% 12/15/07 (FGIC Insured)
Series A, 5.125% 12/15/11 Aaa 2,500,000 2,476,025
(FGIC Insured)
Series A, 5% 12/15/13 (FGIC Aaa 2,675,000 2,567,251
Insured)
Camden County Muni. Util.
Auth. Swr. Rev. Rfdg.:
5.5% 7/15/05 (FGIC Insured) Aaa 1,110,000 1,151,936
5.5% 7/15/08 (FGIC Insured) Aaa 1,300,000 1,346,111
6% 7/15/03 (FGIC Insured) Aaa 3,180,000 3,336,297
6% 7/15/06 (FGIC Insured) Aaa 660,000 703,580
Cape May County Ind. Poll. Aaa 1,350,000 1,522,530
Cont. Fing. Auth. Rev. Rfdg.
(Atlantic City Elec. Co.
Proj.) Series A, 6.8%
3/1/21 (MBIA Insured)
Cherry Hill Township Gen. Aa2 1,115,000 1,121,255
Oblig. Rfdg. Series B, 5.25%
7/15/11
Delaware River Port Auth.
Pennsylvania and New Jersey
Rev.:
Rfdg. Series B:
5.25% 1/1/10 (AMBAC Insured) Aaa 2,245,000 2,270,144
5.25% 1/1/11 (AMBAC Insured) Aaa 2,365,000 2,372,970
Series 1995, 5.5% 1/1/26 Aaa 2,750,000 2,607,908
(FGIC Insured)
Edison Township Gen. Oblig. A1 1,000,000 1,110,170
6.5% 6/1/11
Essex County Util. Auth.
Solid Waste Rev. Series A:
5.75% 4/1/05 (FSA Insured) Aaa 1,000,000 1,047,950
6% 4/1/06 (FSA Insured) Aaa 1,000,000 1,063,620
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT VALUE (NOTE 1)
NEW JERSEY - CONTINUED
Essex County Gen. Oblig.:
Rfdg.:
Series A 1, 6% 11/15/05 (FGIC Aaa $ 3,000,000 $ 3,209,400
Insured)
Series A 2, 6.25% 9/1/10 Aaa 4,735,000 5,097,275
(AMBAC Insured)
Series A:
5.75% 9/1/07 (AMBAC Insured) Aaa 1,385,000 1,467,421
5.75% 9/1/08 (AMBAC Insured) Aaa 1,465,000 1,549,677
5.75% 9/1/09 (AMBAC Insured) Aaa 1,550,000 1,641,652
Essex County Impt. Auth. Rev. Aaa 1,800,000 1,765,908
(Util. Sys.-Orange Franchise
Proj.) Series A, 5.75%
7/1/27 (MBIA Insured)
Jersey City Swr. Auth. Swr.
Rev. Rfdg.:
6% 1/1/07 (AMBAC Insured) Aaa 2,175,000 2,313,830
6% 1/1/09 (AMBAC Insured) Aaa 1,000,000 1,066,450
Lenape Reg'l. High School
District:
7.625% 1/1/13 (MBIA Insured) Aaa 675,000 820,105
7.625% 1/1/14 (MBIA Insured) Aaa 1,000,000 1,215,000
Middlesex County Poll. Cont.
Auth. Rev. Rfdg. (Amerada
Hess Corp. Proj.):
6.875% 12/1/22 - 5,000,000 5,180,450
7.875% 6/1/22 - 7,750,000 8,494,930
Middletown Township Gen. Aaa 1,500,000 1,556,430
Oblig. Board of Ed. 5.7%
8/1/10 (MBIA Insured)
Monmouth County Impt. Auth. Aaa 1,025,000 1,020,008
Rev. 5.4% 12/1/13 (AMBAC
Insured)
Morris County Gen. Oblig. Aaa 2,180,000 2,328,523
6.5% 8/1/03
New Jersey Bldg. Auth. Bldg.
Rev. Rfdg.:
5% 6/15/14 Aa2 4,000,000 3,766,000
5.75% 6/15/09 Aa2 3,000,000 3,151,230
New Jersey Econ. Dev. Auth. A2 2,000,000 2,324,900
Econ. Dev. Rev. (Weyerhauser
Co. Proj.) 9% 11/1/04
New Jersey Econ. Dev. Auth.
Market Transition Facilities
Rev. Sr. Lien Series A:
5.8% 7/1/07 (MBIA Insured) Aaa 3,300,000 3,470,478
5.8% 7/1/09 (MBIA Insured) Aaa 5,000,000 5,235,400
5.875% 7/1/11 (MBIA Insured) Aaa 4,090,000 4,276,218
New Jersey Econ. Dev. Auth.
Rev.:
(Edl. Testing Svc. Proj.):
Series A, 6.5% 5/15/05 (MBIA Aaa 2,200,000 2,304,830
Insured)
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT VALUE (NOTE 1)
NEW JERSEY - CONTINUED
New Jersey Econ. Dev. Auth.
Rev.: - continued
Series B, 6.125% 5/15/15 Aaa $ 2,000,000 $ 2,164,620
(MBIA Insured) (Pre-Refunded
to 5/15/05 @ 102) (e)
(Trans. Proj.) Sub-Lease Aaa 2,000,000 2,098,100
Series B, 5.75% 5/1/10 (FSA
Insured)
Rfdg. (Edl. Testing Svc. Aaa 2,285,000 2,286,759
Proj.) Series A, 5% 5/15/08
(MBIA Insured)
New Jersey Econ. Dev. Auth. Aaa 7,700,000 7,584,038
Wtr. Facilities Rev.
(American Wtr. Co., Inc.
Proj.) 5.95% 11/1/29 (FGIC
Insured) (d)
New Jersey Edl. Facilities
Auth. Rev. Rfdg.:
(Saint Peters College Proj.)
Series B:
5.375% 7/1/12 Baa3 1,450,000 1,362,783
5.375% 7/1/18 Baa3 1,000,000 902,300
(Seton Hall Univ. Proj.) Aaa 2,200,000 2,223,584
5.25% 7/1/09 (AMBAC Insured)
New Jersey Envir.
Infrastructure Trust (Envir.
Infrastructure Proj.) Series
A:
5.5% 9/1/10 Aaa 2,675,000 2,765,816
5.5% 9/1/11 Aaa 2,830,000 2,912,693
5.5% 9/1/12 Aaa 2,980,000 3,040,703
New Jersey Gen. Oblig.:
Rfdg.:
Series D:
5.75% 2/15/06 Aa1 1,950,000 2,049,996
6% 2/15/13 Aa1 7,500,000 7,954,575
Series E, 6% 7/15/10 Aa1 3,000,000 3,217,830
Series F, 5.5% 8/1/08 Aa1 4,000,000 4,151,000
4.75% 3/1/17 Aa1 9,000,000 7,903,980
New Jersey Health Care
Facilities Fing. Auth. Rev.:
(East Orange Gen. Hosp. BBB+ 2,450,000 2,518,478
Proj.) Series B, 7.75% 7/1/20
(Elizabeth Gen. Med. Ctr. Baa1 1,975,000 2,028,898
Proj.) Series C, 7.25% 7/1/06
(Muhlenberg Reg'l. Med. Ctr. Aaa 2,000,000 2,023,500
Proj.) Series B, 8% 7/1/18
(AMBAC Insured)
(Pascack Valley Hosp. Assoc. BBB 5,200,000 5,480,488
Proj.) 6.7% 7/1/11
(Pre-Refunded to 7/1/01 @
102) (e)
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT VALUE (NOTE 1)
NEW JERSEY - CONTINUED
New Jersey Health Care
Facilities Fing. Auth. Rev.:
- - continued
Rfdg.:
(AHS Hosp. Corp. Proj.) Aaa $ 3,500,000 $ 3,739,855
Series A, 6% 7/1/11 (AMBAC
Insured)
(Atlantic City Med. Ctr. A3 4,200,000 4,411,680
Proj.) Series C, 6.8% 7/1/11
(Burdette Tomlin Mem. Hosp. Aaa 1,710,000 1,775,715
Proj.) Series D, 6.25%
7/1/06 (FGIC Insured)
(Cmnty. Med. Ctr./Kimball Aaa 3,835,000 3,830,053
Med. Ctr. Proj.) 5.25%
7/1/11 (FSA Insured)
(Hackensack Univ. Med. Ctr. Aaa 4,665,000 4,630,152
Proj.) Series A, 5.25%
1/1/12 (MBIA Insured)
(Kennedy Health Sys. Proj.)
Series B:
5% 7/1/09 (MBIA Insured) Aaa 1,000,000 990,460
5.75% 7/1/07 (MBIA Insured) Aaa 1,930,000 2,024,088
5.75% 7/1/08 (MBIA Insured) Aaa 1,135,000 1,190,706
(Newcomb Med. Ctr. Proj.) Baa3 1,975,000 2,016,238
Series A, 7.875% 7/1/03
(Saint Barnabas Med. Ctr. Aaa 1,125,000 1,122,581
Proj.) Series A, 5.25%
7/1/11 (MBIA Insured)
New Jersey Hsg. & Mtg. Fin.
Agcy. Rev.:
(Home Buyer Proj.) Series W, Aaa 3,995,000 3,925,727
4.75% 10/1/17 (MBIA Insured)
Rfdg.:
(Home Buyer Proj.) Series AA, Aaa 2,000,000 1,993,100
5.3% 4/1/26 (MBIA Insured)
(d)
Series 1:
6% 11/1/02 A+ 2,435,000 2,475,884
6.2% 11/1/04 A+ 3,100,000 3,238,663
6.45% 11/1/07 A+ 5,090,000 5,314,011
New Jersey Hsg. Fin. Agcy.
Gen. Resolution Series A:
6.9% 11/1/07 AA+ 2,670,000 2,784,196
6.95% 11/1/08 AA+ 2,265,000 2,359,722
7% 11/1/09 AA+ 2,855,000 2,975,338
7.05% 11/1/10 AA+ 3,500,000 3,647,420
New Jersey Hwy. Auth. Garden
State Parkway Gen. Rev.
(Senior Parkway Proj.):
6% 1/1/05 A1 2,200,000 2,292,730
6% 1/1/19 (Escrowed to Aaa 4,485,000 4,660,991
Maturity) (e)
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT VALUE (NOTE 1)
NEW JERSEY - CONTINUED
New Jersey Hwy. Auth. Garden
State Parkway Gen. Rev.
(Senior Parkway Proj.): -
continued
6.1% 1/1/06 A1 $ 1,750,000 $ 1,822,573
6.2% 1/1/10 (b) A1 8,170,000 8,789,940
New Jersey Sport and Aaa 2,675,000 2,691,772
Exposition Auth. Rev. Rfdg.
Series A, 5.25% 3/1/11 (MBIA
Insured)
New Jersey Tpk. Auth. Tpk.
Rev.:
Rfdg.:
Series A:
6.3% 1/1/01 Baa1 1,000,000 1,016,160
6.4% 1/1/02 Baa1 1,000,000 1,030,840
6.75% 1/1/08 Baa1 1,000,000 1,032,780
Series C:
6.5% 1/1/09 Baa1 1,300,000 1,385,449
6.5% 1/1/16 Baa1 615,000 656,334
Series A:
5.7% 1/1/01 Baa1 5,000,000 5,049,600
5.9% 1/1/03 Baa1 9,000,000 9,248,670
New Jersey Trans. Trust Fund
Auth.:
(Trans. Sys. Proj.):
Series A, 5% 6/15/06 Aa2 1,500,000 1,520,640
Series B:
5.25% 6/15/10 Aa2 5,000,000 5,042,200
5.25% 6/15/15 Aa2 3,000,000 2,873,190
6% 6/15/06 (AMBAC Insured) Aa2 16,450,000 17,591,625
Rfdg. (Trans. Sys. Proj.) Aaa 3,000,000 3,332,610
Series B, 6.5% 6/15/10 (MBIA
Insured)
New Jersey Wastewtr.
Treatment Trust Ln. Rev.:
Series A, 6% 7/1/10 Aa1 15,000 15,567
6.875% 6/15/06 Aa2 105,000 107,756
6.875% 6/15/09 Aa2 80,000 82,426
7% 6/15/10 Aa2 140,000 144,360
New Jersey Wtr. Supply Auth. Aaa 2,465,000 2,440,301
Rev. Rfdg. (Delaware &
Raritan Sys. Proj.) 5.375%
11/1/12 (MBIA Insured) (d)
Newark Gen. Oblig. 5.3% Aaa 3,500,000 3,378,480
9/1/16 (MBIA Insured)
North Brunswick Township Gen.
Oblig. Rfdg.:
5.25% 5/15/10 (FGIC Insured) Aaa 1,235,000 1,250,870
5.25% 5/15/11 (FGIC Insured) Aaa 1,290,000 1,297,908
Ocean County Gen. Oblig. Aa1 3,475,000 3,462,421
Rfdg. 5% 10/1/09
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT VALUE (NOTE 1)
NEW JERSEY - CONTINUED
Ocean County Util. Auth. Aa2 $ 5,000,000 $ 4,976,050
Wastewtr. Rev. Rfdg. 5.125%
1/1/10
Rutgers State Univ. of New A1 3,000,000 3,243,900
Jersey Rfdg. (State Univ.
of New Jersey Proj.) Series
A, 6.4% 5/1/13
West Orange Board of Ed. Rev. Aaa 2,000,000 1,920,540
Ctfs. of Prtn. 5.625%
10/1/29 (MBIA Insured)
323,815,279
NEW YORK & NEW JERSEY - 8.9%
Port Auth. New York & New
Jersey:
Rfdg.:
Series 107:
6% 10/15/05 (d) A1 1,740,000 1,836,083
6% 10/15/06 (d) A1 1,535,000 1,623,094
Series 94, 5.7% 12/1/10 A1 6,385,000 6,579,487
Series 104, 4.75% 1/15/26 Aaa 2,450,000 2,045,358
(AMBAC Insured)
Series 109, 5.375% 1/15/32 A1 6,500,000 5,881,590
Series 117, 5.125% 11/15/11 Aaa 5,220,000 5,128,650
(FGIC Insured) (d)
Series 77, 6.25% 1/15/27 (d) A1 5,000,000 5,102,100
Series 92, 4.75% 1/15/29 A1 7,000,000 5,710,949
33,907,311
PUERTO RICO - 1.7%
Puerto Rico Commonwealth Baa1 510,000 517,599
Infrastructure Fing. Auth.
Series A, 7.75% 7/1/08
Puerto Rico Commonwealth Pub. Baa1 2,000,000 2,074,140
Impt. Rev. Rfdg. Series A,
6% 7/1/14
Puerto Rico Elec. Pwr. Auth. Baa1 1,765,000 1,471,110
Pwr. Rev. Rfdg. Series EE,
4.75% 7/1/24
Puerto Rico Hsg. Fin. Corp. AA 2,290,000 2,345,235
Rev. (Multi-family Mtg.
Proj.) Series AI, 7.5%
4/1/22, LOC Puerto Rico
Govt. Dev. Bank
6,408,084
TOTAL MUNICIPAL BONDS 364,130,674
(Cost $361,031,612)
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MUNICIPAL NOTES - 3.2%
PRINCIPAL AMOUNT VALUE (NOTE 1)
NEW JERSEY - 2.3%
New Jersey Econ. Dev. Auth.
Natural Gas Facilities Rev.:
(Natural Gas Co. Proj.) $ 1,000,000 $ 1,000,000
Series 1998 B, 3.8% (AMBAC
Insured), VRDN (c)(d)
Rfdg. (Natural Gas Co. Proj.) 2,300,000 2,300,000
Series 1995 B, 3.6% (AMBAC
Insured) (BPA Societe
Generale, France), VRDN
(c)(d)
Series A, 3.65% (AMBAC 2,500,000 2,500,000
Insured) (BPA Societe
Generale, France), VRDN
(c)(d)
New Jersey Econ. Dev. Auth.
Wtr. Facilities Rev. Rfdg.:
(United Wtr., Inc. Proj.) 500,000 500,000
Series 1996 B, 3.85% (AMBAC
Insured) (BPA Bank of New
York NA), VRDN (c)
(United Wtr., Inc. Proj.) 2,500,000 2,500,000
Series 1996 A, 3.6% (AMBAC
Insured) (BPA Bank of New
York NA), VRDN (c)
8,800,000
NEW YORK & NEW JERSEY - 0.9%
Port Auth. New York & New 3,405,000 3,405,000
Jersey Participating VRDN
Series PA 518, 3.88%
(Liquidity Facility Merrill
Lynch & Co., Inc.) (c)(f)
TOTAL MUNICIPAL NOTES 12,205,000
(Cost $12,205,000)
TOTAL INVESTMENT PORTFOLIO - 376,335,674
99.0%
(Cost $373,236,612)
NET OTHER ASSETS - 1.0% 3,683,204
NET ASSETS - 100% $ 380,018,878
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FUTURES CONTRACTS
EXPIRATION DATE UNDERLYING FACE AMOUNT AT VALUE UNREALIZED GAIN/LOSS
PURCHASED
31 Bond Buyer Municipal Bond Dec. 1999 $ 3,410,000 $ (159,436)
Index Contracts
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The face value of futures purchased as a percentage of net assets -
0.9%
SECURITY TYPE ABBREVIATIONS
VRDN - VARIABLE RATE DEMAND NOTE
LEGEND
(a) S&P credit ratings are used in the absence of a rating by Moody's
Investors Service, Inc.
(b) A portion of the security was pledged to cover margin requirements
for futures contracts. At the period end, the value of securities
pledged amounted to $182,900.
(c) The coupon rate shown on floating or adjustable rate securities
represents the rate at period end.
(d) Private activity obligations whose interest is subject to the
federal alternative minimum tax for individuals.
(e) Security collateralized by an amount sufficient to pay interest
and principal.
(f) Provides evidence of ownership in one or more underlying municipal
bonds.
OTHER INFORMATION
The composition of long-term debt holdings as a percentage of total
value of investments in securities, is as follows (ratings are
unaudited):
MOODY'S RATINGS S&P RATINGS
Aaa, Aa, A 76.4% AAA, AA, A 78.8%
Baa 7.9% BBB 9.0%
Ba 0.0% BB 0.0%
B 0.0% B 0.5%
Caa 0.0% CCC 0.0%
Ca, C 0.0% CC, C 0.0%
D 0.0%
The percentage not rated by Moody's or S&P amounted to 3.6%.
The distribution of municipal securities by revenue source, as a
percentage of net assets, is as follows:
General Obligations 28.0%
Transportation 21.7
Water & Sewer 13.9
Health Care 8.5
Housing 8.2
Others* (individually less 19.7
than 5%)
100.0%
* Includes short-term investments and net
other assets.
INCOME TAX INFORMATION
At November 30, 1999, the aggregate cost of investment securities for
income tax purposes was $373,236,612. Net unrealized appreciation
aggregated $3,099,062, of which $8,089,314 related to appreciated
investment securities and $4,990,252 related to depreciated investment
securities.
The fund hereby designates approximately $2,031,000 as a capital gain
dividend for the purpose of the dividend paid deduction.
At November 30, 1999, the fund had a capital loss carryforward of
approximately $370,000 all of which will expire on November 30, 2007.
During the fiscal year ended November 30, 1999, 100% of the fund's
income dividends was free from federal income tax, and 7.49% of the
fund's income dividends was subject to the federal alternative minimum
tax (unaudited).
The fund hereby designates 100% of the long-term capital gain
dividends distributed during the fiscal year as 20%-rate capital gain
dividends.
The fund will notify shareholders in January 2000 of amounts for use
in preparing 1999 income tax returns.
SPARTAN NEW JERSEY MUNICIPAL INCOME FUND
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
NOVEMBER 30, 1999
ASSETS
Investment in securities, at $ 376,335,674
value (cost $373,236,612) -
See accompanying schedule
Cash 1,355,465
Receivable for investments 1,058,361
sold
Receivable for fund shares 46,762
sold
Interest receivable 6,784,754
Receivable for daily 11,625
variation on futures
contracts
TOTAL ASSETS 385,592,641
LIABILITIES
Payable for investments $ 4,257,158
purchased
Payable for fund shares 701,517
redeemed
Distributions payable 439,558
Accrued management fee 172,454
Other payables and accrued 3,076
expenses
TOTAL LIABILITIES 5,573,763
NET ASSETS $ 380,018,878
Net Assets consist of:
Paid in capital $ 377,605,815
Accumulated undistributed net (526,563)
realized gain (loss) on
investments
Net unrealized appreciation 2,939,626
(depreciation) on investments
NET ASSETS, for 34,886,516 $ 380,018,878
shares outstanding
NET ASSET VALUE, offering $10.89
price and redemption price
per share ($380,018,878
(divided by) 34,886,516
shares)
STATEMENT OF OPERATIONS
YEAR ENDED NOVEMBER 30, 1999
INTEREST INCOME $ 20,854,799
EXPENSES
Management fee $ 2,179,367
Non-interested trustees' 1,189
compensation
Total expenses before 2,180,556
reductions
Expense reductions (17,340) 2,163,216
NET INTEREST INCOME 18,691,583
REALIZED AND UNREALIZED GAIN
(LOSS)
Net realized gain (loss) on:
Investment securities (297,541)
Futures contracts 83,743 (213,798)
Change in net unrealized
appreciation (depreciation)
on:
Investment securities (21,148,207)
Futures contracts (124,786) (21,272,993)
NET GAIN (LOSS) (21,486,791)
NET INCREASE (DECREASE) IN $ (2,795,208)
NET ASSETS RESULTING FROM
OPERATIONS
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STATEMENT OF CHANGES IN NET ASSETS
YEAR ENDED NOVEMBER 30, 1999 YEAR ENDED NOVEMBER 30, 1998
INCREASE (DECREASE) IN NET
ASSETS
Operations Net interest income $ 18,691,583 $ 17,868,355
Net realized gain (loss) (213,798) 2,113,812
Change in net unrealized (21,272,993) 5,092,798
appreciation (depreciation)
NET INCREASE (DECREASE) IN (2,795,208) 25,074,965
NET ASSETS RESULTING FROM
OPERATIONS
Distributions to shareholders (18,691,583) (17,868,355)
From net interest income
From net realized gain (1,647,076) (1,741,847)
In excess of net realized (383,537) 0
gain
TOTAL DISTRIBUTIONS (20,722,196) (19,610,202)
Share transactions Net 71,810,126 60,470,984
proceeds from sales of shares
Reinvestment of distributions 15,235,926 14,908,087
Cost of shares redeemed (73,247,294) (52,762,136)
NET INCREASE (DECREASE) IN 13,798,758 22,616,935
NET ASSETS RESULTING FROM
SHARE TRANSACTIONS
Redemption fees 41,291 21,466
TOTAL INCREASE (DECREASE) (9,677,355) 28,103,164
IN NET ASSETS
NET ASSETS
Beginning of period 389,696,233 361,593,069
End of period $ 380,018,878 $ 389,696,233
OTHER INFORMATION
Shares
Sold 6,348,487 5,270,314
Issued in reinvestment of 1,356,855 1,300,244
distributions
Redeemed (6,553,756) (4,606,133)
Net increase (decrease) 1,151,586 1,964,425
</TABLE>
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FINANCIAL HIGHLIGHTS
YEARS ENDED NOVEMBER 30, 1999 1998 1997 1996 1995
SELECTED PER-SHARE DATA
Net asset value, beginning $ 11.550 $ 11.380 $ 11.380 $ 11.420 $ 10.320
of period
Income from Investment .528 .548 .561 .588 .623
Operations Net interest
income
Net realized and unrealized (.601) .224 .140 - 1.099
gain (loss)
Total from investment (.073) .772 .701 .588 1.722
operations
Less Distributions
From net interest income (.528) (.548) (.561) (.588) (.623)
From net realized gain (.049) (.055) (.140) (.040) -
In excess of net realized gain (.011) - - - -
Total distributions (.588) (.603) (.701) (.628) (.623)
Redemption fees added to .001 .001 - - .001
paid in capital
Net asset value, end of period $ 10.890 $ 11.550 $ 11.380 $ 11.380 $ 11.420
TOTAL RETURN A (0.65)% 6.96% 6.44% 5.37% 17.06%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 380,019 $ 389,696 $ 361,593 $ 357,367 $ 366,569
(000 omitted)
Ratio of expenses to average .55% .55% .55% .55% .55%
net assets
Ratio of expenses to average .55% .54% B .55% .52% B .55%
net assets after expense
reductions
Ratio of net interest income 4.71% 4.78% 5.00% 5.26% 5.64%
to average net assets
Portfolio turnover rate 19% 12% 16% 57% 36%
</TABLE>
A THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT
BEEN REDUCED DURING THE PERIODS SHOWN.
B FMR OR THE FUND HAS ENTERED INTO VARYING ARRANGEMENTS WITH THIRD
PARTIES WHO EITHER PAID OR REDUCED A PORTION OF THE FUND'S EXPENSES.
SPARTAN NEW JERSEY MUNICIPAL MONEY MARKET FUND
PERFORMANCE: THE BOTTOM LINE
To evaluate a money market fund's historical performance, you can look
at either total return or yield. Total return reflects the change in
the value of an investment, assuming reinvestment of the fund's
dividend income but does not include the effect of the $5 account
closeout fee on an average-size account. Yield measures the income
paid by a fund. Since a money market fund tries to maintain a $1 share
price, yield is an important measure of performance. If Fidelity had
not reimbursed certain fund expenses, the past five year and life of
fund total returns would have been lower.
CUMULATIVE TOTAL RETURNS
PERIODS ENDED NOVEMBER 30, 1999 PAST 1 YEAR PAST 5 YEARS LIFE OF FUND
SPARTAN NJ MUNICIPAL MONEY 2.78% 17.01% 36.79%
MARKET
New Jersey Tax-Free Money 2.46% 15.23% n/a
Market Funds Average
CUMULATIVE TOTAL RETURNS show the fund's performance in percentage
terms over a set period - in this case, one year, five years or since
the fund started on May 1, 1990. For example, if you had invested
$1,000 in a fund that had a 5% return over the past year, the value of
your investment would be $1,050. To measure how the fund's performance
stacked up against its peers, you can compare it to the New Jersey
tax-free money market funds average which reflects the performance of
tax-free money market funds with similar objectives tracked by IBC
Financial Data, Inc. The past one year average represents a peer group
of 16 money market funds.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED NOVEMBER 30, 1999 PAST 1 YEAR PAST 5 YEARS LIFE OF FUND
SPARTAN NJ MUNICIPAL MONEY 2.78% 3.19% 3.32%
MARKET
New Jersey Tax-Free Money 2.46% 2.87% n/a
Market Funds Average
AVERAGE ANNUAL TOTAL RETURNS take the fund's cumulative return and
show you what would have happened if the fund had performed at a
constant rate each year.
YIELDS
11/29/99 8/30/99 5/31/99 3/1/99 11/30/98
Spartan New Jersey 3.15% 2.71% 2.75% 2.53% 2.83%
Municipal Money Market
New Jersey Tax-Free Money 2.97% 2.40% 2.49% 2.21% 2.51%
Market Funds Average
Spartan New Jersey 5.27% 4.53% 4.60% 4.21% 4.72%
Municipal Money Market -
Tax-equivalent
Portion of fund's income 10.89% 9.54% 3.36% 9.13% 6.95%
subject to state taxes
YIELD refers to the income paid by the fund over a given period.
Yields for money market funds are usually for seven-day periods,
expressed as annual percentage rates. A yield that assumes income
earned is reinvested or compounded is called an effective yield. The
table above shows the fund's current seven-day yield at quarterly
intervals over the past year. You can compare these yields to the New
Jersey tax-free money market funds average as tracked by IBC Financial
Data, Inc. or you can look at the fund's tax-equivalent yield, which
is based on a combined effective 1999 federal and state income tax
rate of 40.08%. The fund's yields mentioned above reflect that a
portion of the fund's income was subject to state taxes. A portion of
the fund's income may be subject to the federal alternative minimum
tax.
A MONEY MARKET FUND'S TOTAL RETURNS AND YIELDS VARY, AND REFLECT PAST
RESULTS RATHER THAN PREDICT FUTURE PERFORMANCE.
(checkmark)COMPARING
PERFORMANCE
Yields on tax-free investments
are usually lower than yields
on taxable investments.
However, a straight
comparison between the
two may be misleading
because it ignores the way
taxes reduce taxable returns.
Tax-equivalent yield - the
yield you'd have to earn on a
similar taxable investment to
match the tax-free yield -
makes the comparison more
meaningful. Keep in mind that
the U.S. government neither
insures nor guarantees a
money market fund. In fact,
there is no assurance that a
money market fund will
maintain a $1 share price.
SPARTAN NEW JERSEY MUNICIPAL MONEY MARKET FUND
FUND TALK: THE MANAGER'S OVERVIEW
(photograph of Scott Orr)
An interview with Scott Orr, Portfolio Manager of Spartan New Jersey
Municipal Money Market Fund
Q. SCOTT, WHAT WAS THE INVESTMENT ENVIRONMENT LIKE OVER THE 12 MONTHS
THAT ENDED NOVEMBER 30, 1999?
A. At the beginning of the period, a global economic crisis continued
to cast a shadow over the market. There were many questions about the
pace of U.S. economic growth and the direction of interest rates.
Early in 1999, however, any doubts were put to rest, as both growth
and employment strengthened. In addition, data began to indicate that
inflation might not be as well-behaved as it had been in the recent
past. Faced with that backdrop, market observers began to feel that
the Federal Reserve Board would raise short-term interest rates to
slow growth and head off inflation. Through the rest of the period,
economic growth remained solid and unemployment stayed at historically
low levels. Such a tight labor market often leads to inflation, as
employers are forced to raise salaries in order to attract or retain
workers, passing on the additional cost to the consumer. The Fed
indicated that improvements in worker productivity had helped keep
inflation at bay. Nevertheless, with constant, broad-based economic
strength and continually tight labor markets, the Fed felt compelled
to take back all three of the rate cuts it had implemented in the fall
of 1998. It did so with a series of three 0.25 percentage point rate
hikes in June, August and November, raising the rate banks charge each
other for overnight loans - known as the fed funds rate - from 4.75%
at the beginning of the period to 5.50% by the end of November 1999.
Q. WHAT WAS YOUR STRATEGY AS THIS TRANSPIRED?
A. At the beginning of the period, the fund's average maturity was
neutral relative to its peers, given the uncertainty of the
interest-rate environment. Over the next few months, I let the average
maturity roll down as I avoided locking in the relatively low interest
rates we saw at that time. As rates began to move higher again in
March, however, I bought longer-term securities that adequately
reflected my expectations for higher interest rates. During the last
six months of the period, I returned the fund's average maturity to a
neutral position by spreading the fund's investments across all
segments of the short-term yield curve.
Q. WHY DID THE FUND INVEST OUT-OF-STATE?
A. The fund pursued this strategy - within the limits of the fund's
investment policies - in order to provide shareholders with a higher
tax-adjusted yield. In certain cases, yields on New Jersey obligations
were sufficiently low so that comparable out-of-state obligations
provided a higher tax-adjusted yield even though they are subject to
New Jersey tax. Even though more of shareholders' income for the
fund's 1999 fiscal year will be taxable than if I had purchased
exclusively New Jersey obligations, shareholders may be able to retain
more of the fund's dividends, after taxes are taken into account. The
fund may also invest out-of-state if there is a limited supply of New
Jersey obligations.
Q. HOW DID THE FUND PERFORM?
A. The fund's seven-day yield on November 30, 1999, was 3.15%,
compared to 2.83% 12 months ago. The more recent seven-day yield was
the equivalent of a 5.27% taxable rate of return for New Jersey
investors in the 40.08% combined state and federal income tax bracket.
The fund's yields reflect that a portion of the fund's income was
subject to state taxes. Through November 30, 1999, the fund's 12-month
total return was 2.78%, compared to 2.46% for the New Jersey tax-free
money market funds average, according to IBC Financial Data, Inc.
Q. WHAT IS YOUR OUTLOOK?
A. Before the Fed's most recent rate hike, market sentiment reflected
the belief that the Fed would sit back and wait to see what happens
after bringing rates back to their 1998 levels. However, judging by
its reaction to the latest Fed move, the market doesn't feel the Fed
is done implementing rate increases. If the trends of tight employment
and economic strength continue, I believe it is likely the Fed will
raise rates again in early 2000 to slow growth and prevent inflation
from cropping up. The timing and scope of any Fed rate hikes would
most probably be dictated by the pace of the economy and the tightness
of the labor market.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO
MANAGER ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON
THE COVER AND DO NOT NECESSARILY REPRESENT THE VIEWS OF FIDELITY OR
ANY OTHER PERSON IN THE FIDELITY ORGANIZATION. ANY SUCH VIEWS ARE
SUBJECT TO CHANGE AT ANY TIME BASED UPON MARKET OR OTHER CONDITIONS
AND FIDELITY DISCLAIMS ANY RESPONSIBILITY TO UPDATE SUCH VIEWS. THESE
VIEWS MAY NOT BE RELIED ON AS INVESTMENT ADVICE AND, BECAUSE
INVESTMENT DECISIONS FOR A FIDELITY FUND ARE BASED ON NUMEROUS
FACTORS, MAY NOT BE RELIED ON AS AN INDICATION OF TRADING INTENT ON
BEHALF OF ANY FIDELITY FUND.
(checkmark)FUND FACTS
GOAL: as high a level of
current income, exempt from
federal income tax and, to the
extent possible, from the New
Jersey Gross Income Tax, as is
consistent with preservation of
capital
FUND NUMBER: 423
TRADING SYMBOL: FSJXX
START DATE: May 1, 1990
SIZE: as of November 30,
1999, more than $498
million
MANAGER: Scott Orr, since
1997; manager, various
Fidelity and Spartan
municipal money market
funds; joined Fidelity in
1989
SPARTAN NEW JERSEY MUNICIPAL MONEY MARKET FUND
INVESTMENT CHANGES
<TABLE>
<CAPTION>
<S> <C> <C> <C>
MATURITY DIVERSIFICATION
DAYS % OF FUND'S INVESTMENTS % OF FUND'S INVESTMENTS 5/31/99 % OF FUND'S INVESTMENTS
11/30/99 11/30/98
0 - 30 60.3 68.0 61.0
31 - 90 23.4 10.9 11.9
91 - 180 8.3 4.2 16.2
181 - 397 8.0 16.9 10.9
WEIGHTED AVERAGE MATURITY
11/30/99 5/31/99 11/30/98
Spartan New Jersey Municipal 49 DAYS 65 Days 57 Days
Money Market Fund
New Jersey Tax-Free Money 53 DAYS 55 Days 56 Days
Market Funds Average *
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
ASSET ALLOCATION (% OF FUND'S
NET ASSETS)
AS OF NOVEMBER 30, 1999 AS OF MAY 31, 1999
Variable Rate Demand Notes Variable Rate Demand Notes
(VRDNs) 56.0% (VRDNs) 60.5%
Commercial Paper (including Commercial Paper (including
CP Mode) 15.3% CP Mode) 8.6%
Tender Bonds 3.1% Tender Bonds 0.6%
Municipal Notes 24.4% Municipal Notes 28.7%
Net Other Assets 1.2% Net Other Assets 1.6%
Row: 1, Col: 1, Value: 56.0 Row: 1, Col: 1, Value: 60.5
Row: 1, Col: 2, Value: 0.0 Row: 1, Col: 2, Value: 0.0
Row: 1, Col: 3, Value: 15.3 Row: 1, Col: 3, Value: 8.6
Row: 1, Col: 4, Value: 0.0 Row: 1, Col: 4, Value: 0.0
Row: 1, Col: 5, Value: 3.1 Row: 1, Col: 5, Value: 0.6000000000000001
Row: 1, Col: 6, Value: 0.0 Row: 1, Col: 6, Value: 0.0
Row: 1, Col: 7, Value: 24.4 Row: 1, Col: 7, Value: 28.7
Row: 1, Col: 8, Value: 1.2 Row: 1, Col: 8, Value: 1.6
</TABLE>
PRIOR TO THIS REPORT, CERTAIN INFORMATION RELATED TO PORTFOLIO
HOLDINGS WAS STATED AS A PERCENTAGE OF THE FUND'S INVESTMENTS.
SPARTAN NEW JERSEY MUNICIPAL MONEY MARKET FUND
INVESTMENTS NOVEMBER 30, 1999
Showing Percentage of Net Assets
MUNICIPAL SECURITIES - 98.8%
PRINCIPAL AMOUNT VALUE (NOTE 1)
ILLINOIS - 1.1%
Madison County Envir. Impt. $ 4,600,000 $ 4,600,000
Rev. (Shell Wood River
Proj.) Series 1998 A, 3.85%
(Shell Oil Co. Guaranteed),
VRDN (a)(b)
Southwestern Illinois Dev. 800,000 800,000
Auth. Solid Waste Disp. Rev.
(Shell Oil Co./Wood River
Proj.) Series 1992, 3.85%,
VRDN (a)(b)
5,400,000
INDIANA - 0.6%
Indiana Dev. Fin. Auth. 1,800,000 1,800,000
Envir. Rev. Rfdg. (PSI
Energy Proj.) Series 1998,
3.85%, LOC Morgan Guaranty
Trust Co., NY, VRDN (a)(b)
Whiting Ind. Swr.& Solid 1,000,000 1,000,000
Waste Disp. Rev. Rfdg.
(Amoco Oil Co. Proj.) 3.85%,
VRDN (a)(b)
2,800,000
LOUISIANA - 1.2%
Plaquemines Envir. Rev. Rfdg. 2,400,000 2,400,000
(BP Exploration & Oil, Inc.
Proj.) Series 1995, 3.85%,
VRDN (a)(b)
Saint Charles Parish Poll. 3,300,000 3,300,000
Cont. Rev. (Shell Oil Co.
Proj.) Series A, 3.85%,
VRDN (a)(b)
5,700,000
NEW JERSEY - 69.6%
Bloomfield Township Gen. 4,200,000 4,200,452
Oblig. BAN 3.8% 6/28/00
Brick Township Gen. Oblig. 6,700,000 6,709,545
BAN 3.4% 5/12/00
Burlington County Gen. Oblig.
BAN:
3.5% 4/21/00 2,136,000 2,139,208
3.75% 8/11/00 3,500,000 3,507,745
Camden County Impt. Auth. 900,000 900,000
Rev. (Jewish Cmnty. Ctr.
Proj.) Series 1995, 3.85%,
LOC Nat'l. Westminster Bank
PLC, VRDN (a)
Clifton Gen. Oblig. BAN:
3.5% 3/31/00 1,700,000 1,702,621
4% 8/18/00 4,700,000 4,714,888
Cranford Township Gen. Oblig. 2,295,634 2,298,563
BAN 3.5% 3/17/00
Delaware River Port Auth. 5,700,000 5,700,000
Pennsylvania and New Jersey
Rev. Participating VRDN
Series SG 53, 3.98%
(Liquidity Facility Societe
Generale, France) (a)(c)
East Brunswick Township Gen.
Oblig. BAN:
3.25% 3/31/00 6,547,000 6,552,252
3.9% 8/10/00 2,300,000 2,306,138
4.25% 10/13/00 4,100,000 4,118,125
MUNICIPAL SECURITIES -
CONTINUED
PRINCIPAL AMOUNT VALUE (NOTE 1)
NEW JERSEY - CONTINUED
Essex County Impt. Auth. $ 3,500,000 $ 3,500,000
Participating VRDN Series
FRRI A27, 3.9% (Liquidity
Facility Bank of New York
NA) (a)(c)
Fair Lawn Gen. Oblig. BAN 4,000,000 4,000,349
3.25% 12/16/99
Hudson County Impt. Auth. 24,960,000 24,960,000
Rev. (Essential Purp. Pooled
Govt. Ln. Prog.) Series
1986, 3.85%, LOC First Union
Nat'l. Bank, North Carolina,
VRDN (a)
Jefferson Township Gen. 2,346,000 2,352,987
Oblig. BAN 4% 7/14/00
Margate City Gen. Oblig. BAN:
3.5% 3/24/00 2,194,500 2,196,885
4% 8/17/00 3,900,000 3,911,223
Medford Township Gen. Oblig. 3,000,000 3,000,088
BAN 3.13% 1/7/00
Mercer County Impt. Auth. BAN 2,000,000 2,000,000
(Parking Facilities Proj.)
Series 1999, 3.6% 1/12/00
Mercer County Impt. Auth. 11,000,000 11,000,000
Rev. (Atlantic Foundation &
Johnson Proj.) Series 1998,
3.8% (MBIA Insured), VRDN (a)
Middlesex County Gen. Oblig. 20,600,000 20,604,450
BAN 3.25% 1/24/00
Montclair Township Gen.
Oblig. BAN:
3.4% 2/15/00 3,000,000 3,002,176
3.5% 1/21/00 3,537,000 3,539,298
Montgomery Township Gen. 3,122,160 3,122,317
Oblig. BAN Series 1998,
3.25% 12/10/99
Moorestown Township Gen. 3,900,000 3,905,697
Oblig. BAN 3.5% 6/2/00
New Jersey Econ. Dev. Auth.
Econ. Dev. Rev.:
(Arden Group Proj.) Series 1,350,000 1,350,000
1989 BB, 3.8%, LOC PNC Bank
NA, VRDN (a)(b)
(Ctr. for Aging Applewood 2,125,000 2,125,000
Proj.) Series 1989, 3.84%,
LOC Fleet Nat'l. Bank, VRDN
(a)
(Dial Realty Proj.) Series 1,850,000 1,850,000
1988 L, 3.8%, LOC PNC Bank
NA, VRDN (a)(b)
(Guttenplan's Bakery Proj.) 1,500,000 1,500,000
Series 1989 G, 3.8%, LOC PNC
Bank NA, VRDN (a)(b)
(Herzel Motor Corp. Proj.) 350,000 350,000
Series 1989 L, 3.8%, LOC PNC
Bank NA, VRDN (a)(b)
(PVC Container Corp. Proj.) 1,715,000 1,715,000
Series 1987 D, 3.95%, LOC
Nat'l. Westminster Bank PLC,
VRDN (a)(b)
(Recycle, Inc. Proj.) Series 3,700,000 3,700,000
1995, 3.95%, LOC Fleet Bank
NA, VRDN (a)(b)
New Jersey Econ. Dev. Auth. 200,000 200,000
Ind. & Econ. Dev. Rev. (Casa
Di Bertacchi Corp. Proj.)
Series 1988, 4%, LOC HSBC
Bank USA, VRDN (a)(b)
MUNICIPAL SECURITIES -
CONTINUED
PRINCIPAL AMOUNT VALUE (NOTE 1)
NEW JERSEY - CONTINUED
New Jersey Econ. Dev. Auth. $ 380,000 $ 380,000
Ind. Dev. Rev. (Nat'l.
Refrigerant Proj.) Series
1994 A, 3.95%, LOC First
Union Nat'l. Bank, North
Carolina, VRDN (a)(b)
New Jersey Econ. Dev. Auth.
Rev.:
Bonds (Chambers Cogeneration 12,200,000 12,200,000
LTP Proj.) Series 1991,
3.45% tender 2/10/00, LOC
Cr. Local de France, CP mode
(b)
Participating VRDN Series 4,225,000 4,225,000
1998 184, 3.87% (Liquidity
Facility Morgan Stanley Dean
Witter & Co.) (a)(c)
(Bayshore Health Ctr. Proj.) 1,955,000 1,955,000
Series 1998 A, 3.9%, LOC
Kredietbank NV, VRDN (a)
(E. P. Henry Corp. Proj.) 695,000 695,000
3.8%, LOC First Union Nat'l.
Bank, North Carolina, VRDN
(a)(b)
(Eastern Silk Proj.) Second 1,160,000 1,160,000
Series D2, 3.85%, LOC Banque
Nationale de Paris, VRDN
(a)(b)
(Jewish Home Rockleigh Proj.) 7,000,000 7,000,000
Series B, 3.8%, LOC PNC Bank
NA, VRDN (a)
New Jersey Econ. Dev. Auth.
Wtr. Facilities Rev.
Participating VRDN:
Series FRRI 34, 4% (Liquidity 8,415,000 8,415,000
Facility Bank of New York
NA) (a)(b)(c)
Series FRRI 35, 4% (Liquidity 1,175,000 1,175,000
Facility Bank of New York
NA) (a)(b)(c)
New Jersey Ed. Dev. Auth. 6,735,000 6,735,000
Bonds Series 1999 82,
3.75%, tender 1/19/00
(Liquidity Facility The
Bear Stearns Companies,
Inc.) (c)
New Jersey Gen. Oblig.:
Participating VRDN Series 5,000,000 5,000,000
1999 3, 3.97% (Liquidity
Facility Toronto Dominion
Bank) (a)(c)
Series Fiscal 2000 A:
3.7% 3/1/00, CP 10,000,000 10,000,000
3.8% 1/18/00, CP 18,000,000 18,000,000
3.8% 1/27/00, CP 12,700,000 12,700,000
3.9% 1/19/00, CP 5,000,000 5,000,000
3.9% 2/1/00, CP 12,000,000 12,000,000
New Jersey Higher Ed. Auth. 2,260,000 2,260,000
Student Ln. Rev.
Participating VRDN Series
1998 18, 3.92% (Liquidity
Facility Morgan Stanley Dean
Witter & Co.) (a)(c)
New Jersey Hsg. & Mtg. Fin.
Agcy. Rev.:
Bonds Series PA 117, 3.75%, 3,745,000 3,745,000
tender 2/24/00 (Liquidity
Facility Merrill Lynch &
Co., Inc.) (b)(c)(d)
MUNICIPAL SECURITIES -
CONTINUED
PRINCIPAL AMOUNT VALUE (NOTE 1)
NEW JERSEY - CONTINUED
New Jersey Hsg. & Mtg. Fin.
Agcy. Rev.: - continued
Participating VRDN:
Series 1999 V, 3.99% $ 5,000,000 $ 5,000,000
(Liquidity Facility Bank of
America NA) (a)(b)(c)
Series PT 118, 3.93% 28,055,000 28,055,000
(Liquidity Facility Banco
Santander SA) (a)(b)(c)
Series PT 92, 3.93% 5,670,000 5,670,000
(Liquidity Facility Merrill
Lynch & Co., Inc.) (a)(b)(c)
New Jersey Sport and 4,600,000 4,600,000
Exposition Auth. Rev.
Participating VRDN Series
FRRI A3, 3.95% (Liquidity
Facility Commerzbank AG)
(a)(c)
New Jersey Trans. Trust Fund 4,600,000 4,600,000
Auth. Bonds (Trans. Sys.
Proj.) Series A 1999 80,
3.75%, tender 2/7/00
(Liquidity Facility The Bear
Stearns Companies, Inc.) (c)
North Brunswick Township Gen. 2,500,000 2,500,040
Oblig. BAN 3.75% 12/6/99
Readington Township Gen. 4,900,000 4,906,181
Oblig. BAN 3.4% 4/28/00
Red Bank Borough Gen. Oblig. 2,229,500 2,234,122
BAN 4.125% 11/16/00
Ringwood Boro Gen. Oblig. BAN 2,388,000 2,391,180
3.5% 3/17/00
Secaucus Gen. Oblig. BAN 3.4% 3,009,500 3,012,630
6/1/00
Union County Util. Auth. 6,200,000 6,200,000
Solid Waste Facilities Lease
Rev. Participating VRDN
Series FRRI 38, 4%
(Liquidity Facility Bank of
New York NA) (a)(b)(c)
Vernon Township Gen. Oblig. 7,000,000 7,000,143
Board of Ed. BAN 3.5%
12/3/99
Voorhees Township Gen. Oblig. 2,430,500 2,432,378
BAN 4% 2/8/00
Warren County Gen. Oblig. BAN 2,199,921 2,200,214
3.17% 4/7/00
Woodbridge Township Gen. 4,900,000 4,915,508
Oblig. BAN 3.9% 7/28/00
347,097,403
NEW YORK & NEW JERSEY - 20.3%
Port Auth. New York & New
Jersey:
Participating VRDN Series PT 3,925,000 3,925,000
232, 3.93% (Liquidity
Facility Commerzbank AG)
(a)(b)(c)
Series 1991, 3.9519%, VRDN 6,400,000 6,400,000
(a)(b)(d)
Series 1992, 3.725%, VRDN 6,900,000 6,900,000
(a)(d)
Series 1995, 3.725%, VRDN 10,500,000 10,500,000
(a)(b)(d)
Series 1996 3, 3.95%, VRDN (a) 5,000,000 5,000,000
Series 1997 1B, 3.95%, VRDN 3,200,000 3,200,000
(a)
Series 1997 2, 3.725%, VRDN 10,400,000 10,400,000
(a)(d)
Series A:
3.4% 1/28/00, CP (b) 1,100,000 1,100,000
MUNICIPAL SECURITIES -
CONTINUED
PRINCIPAL AMOUNT VALUE (NOTE 1)
NEW YORK & NEW JERSEY -
CONTINUED
Port Auth. New York & New
Jersey: - continued
3.45% 1/26/00, CP (b) $ 4,700,000 $ 4,700,000
Port Auth. New York & New
Jersey Spl. Oblig. Rev.
Participating VRDN:
Series SG 117, 3.93% 13,100,000 13,100,000
(Liquidity Facility Societe
Generale, France) (a)(b)(c)
Series SG 92, 3.93% 3,655,000 3,655,000
(Liquidity Facility Societe
Generale, France) (a)(b)(c)
Series SG 94, 3.93% 32,400,000 32,399,999
(Liquidity Facility Societe
Generale, France) (a)(b)(c)
101,279,999
TEXAS - 5.7%
Brazos River Auth. Poll.
Cont. Rev.:
(Texas Utils. Elec. Co. 4,700,000 4,700,000
Proj.) Series 1995 A, 3.9%,
LOC Morgan Guaranty Trust
Co., NY, VRDN (a)(b)
Rfdg. (Texas Utils. Elec. Co.
Proj.):
Series 1996 A, 3.9% (AMBAC 7,500,000 7,500,000
Insured) (BPA Bank of New
York NA), VRDN (a)(b)
Series 1996 C, 3.9% (AMBAC 5,100,000 5,100,000
Insured) (BPA Bank of New
York NA), VRDN (a)(b)
Brazos River Hbr. Navigation 6,500,000 6,500,000
District (Dow Chemical Co.
Proj.) Series 1996, 3.95%,
VRDN (a)(b)
Gulf Coast Ind. Dev. Auth. 2,100,000 2,100,000
Solid Waste Disp. Rev.
(Citgo Petroleum Corp.
Proj.) Series 1995, 3.9%,
LOC Bank of America NA, VRDN
(a)(b)
Gulf Coast Waste Disp. Auth. 1,100,000 1,100,000
Poll. Cont. Rev. (Amoco Oil
Co. Proj.) Series 1994,
3.85%, VRDN (a)(b)
Gulf Coast Waste Disp. Auth. 1,400,000 1,400,000
Envir. Impt. Rev. (Amoco Oil
Co. Proj.) Series 1998,
3.85%, VRDN (a)(b)
28,400,000
MUNICIPAL SECURITIES -
CONTINUED
PRINCIPAL AMOUNT VALUE (NOTE 1)
VIRGINIA - 0.3%
Dinwiddie County Ind. Dev. $ 1,700,000 $ 1,700,000
Auth. Rev. (Chaparral Steel
Proj.) Series 1998 A, 3.9%,
LOC Bank of America NA, VRDN
(a)(b)
TOTAL INVESTMENT PORTFOLIO - 492,377,402
98.8% (Cost $492,377,402)
NET OTHER ASSETS - 1.2% 6,223,543
NET ASSETS - 100% $ 498,600,945
Total Cost for Income Tax Purposes $ 492,377,402
SECURITY TYPE ABBREVIATIONS
BAN - BOND ANTICIPATION NOTE
VRDN - VARIABLE RATE DEMAND NOTE
LEGEND
(a) The coupon rate shown on floating or adjustable rate securities
represents the rate at period end.
(b) Private activity obligations whose interest is subject to the
federal alternative minimum tax for individuals.
(c) Provides evidence of ownership in one or more underlying municipal
bonds.
(d) Restricted securities - Investment in securities not registered
under the Securities Act of 1933.
Additional information on each holding is as follows:
SECURITY ACQUISITION DATE COST
New Jersey Hsg. & Mtg. Fin. 8/24/99 $ 3,745,000
Agcy. Rev. Bonds Series PA
117, 3.75%, tender 2/24/00
(Liquidity Facility Merrill
Lynch & Co., Inc.)
Port Auth. New York & New 6/18/91 $ 6,400,000
Jersey Series 1991, 3.9519%,
VRDN
Port Auth. New York & New 2/14/92 $ 6,900,000
Jersey Series 1992, 3.725%,
VRDN
Port Auth. New York & New 9/15/95 $ 10,500,000
Jersey Series 1995, 3.725%,
VRDN
Port Auth. New York & New 9/15/97 $ 10,400,000
Jersey Series 1997 2,
3.725%, VRDN
OTHER INFORMATION
The fund invested in securities that are not registered under the
Securities Act of 1933. These securities are subject to legal or
contractual restrictions on resale. At the end of the period,
restricted securities (excluding Rule 144A issues) amounted to
$37,945,000 and 7.6% of net assets.
INCOME TAX INFORMATION
At November 30, 1999, the fund had a capital loss carryforward of
approximately $49,000 of which $2,000, $16,000, $2,000 and $29,000
will expire on November 30, 2000, 2002, 2003 and 2004, respectively.
During the fiscal year ended November 30, 1999, 100% of the fund's
income dividends was free from federal income tax, and 38.95% of the
fund's income dividends was subject to the federal alternative minimum
tax (unaudited).
The fund will notify shareholders in January 2000 of amounts for use
in preparing 1999 income tax returns.
SPARTAN NEW JERSEY MUNICIPAL MONEY MARKET FUND
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
NOVEMBER 30, 1999
ASSETS
Investment in securities, at $ 492,377,402
value - See accompanying
schedule
Receivable for fund shares 1,870,294
sold
Interest receivable 4,743,130
TOTAL ASSETS 498,990,826
LIABILITIES
Payable to custodian bank $ 115,550
Distributions payable 68,405
Accrued management fee 202,699
Other payables and accrued 3,227
expenses
TOTAL LIABILITIES 389,881
NET ASSETS $ 498,600,945
Net Assets consist of:
Paid in capital $ 498,650,070
Accumulated net realized gain (49,125)
(loss) on investments
NET ASSETS, for 498,622,875 $ 498,600,945
shares outstanding
NET ASSET VALUE, offering $1.00
price and redemption price
per share ($498,600,945
(divided by) 498,622,875
shares)
STATEMENT OF OPERATIONS
YEAR ENDED NOVEMBER 30, 1999
INTEREST INCOME $ 16,260,055
EXPENSES
Management fee $ 2,508,085
Non-interested trustees' 1,988
compensation
Total expenses before 2,510,073
reductions
Expense reductions (6,180) 2,503,893
NET INTEREST INCOME 13,756,162
NET REALIZED GAIN (LOSS) ON 21,297
INVESTMENTS
NET INCREASE (DECREASE) IN $ 13,777,459
NET ASSETS RESULTING FROM
OPERATIONS
<TABLE>
<CAPTION>
<S> <C> <C>
STATEMENT OF CHANGES IN NET ASSETS
YEAR ENDED NOVEMBER 30, 1999 YEAR ENDED NOVEMBER 30, 1998
INCREASE (DECREASE) IN NET
ASSETS
Operations Net interest income $ 13,756,162 $ 15,704,226
Net realized gain (loss) 21,297 672
NET INCREASE (DECREASE) IN 13,777,459 15,704,898
NET ASSETS RESULTING FROM
OPERATIONS
Distributions to shareholders (13,756,162) (15,704,226)
from net interest income
Share transactions at net 364,903,165 474,746,691
asset value of $1.00 per
share Proceeds from sales of
shares
Reinvestment of 12,953,174 15,281,562
distributions from net
interest income
Cost of shares redeemed (407,766,221) (485,904,369)
NET INCREASE (DECREASE) IN (29,909,882) 4,123,884
NET ASSETS AND SHARES
RESULTING FROM SHARE
TRANSACTIONS
TOTAL INCREASE (DECREASE) (29,888,585) 4,124,556
IN NET ASSETS
NET ASSETS
Beginning of period 528,489,530 524,364,974
End of period $ 498,600,945 $ 528,489,530
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
FINANCIAL HIGHLIGHTS
YEARS ENDED NOVEMBER 30, 1999 1998 1997 F 1997 G 1996 G 1995 G
SELECTED PER-SHARE DATA
Net asset value, beginning of $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
period
Income from Investment .027 .030 .003 .032 .032 .036
Operations Net interest
income
Less Distributions
From net interest income (.027) (.030) (.003) (.032) (.032) (.036)
Net asset value, end of $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
period
TOTAL RETURN B, C 2.78% 3.06% .27% 3.22% 3.24% 3.65%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 498,601 $ 528,490 $ 524,365 $ 520,551 $ 504,875 $ 469,834
(000 omitted)
Ratio of expenses to average .50% .50% .50% A .40% D .35% D .31% D
net assets
Ratio of expenses to average .50% .50% .50% A .40% .34% E .31%
net assets after expense
reductions
Ratio of net interest income 2.74% 3.02% 3.28% A 3.15% 3.20% 3.59%
to average net assets
</TABLE>
A ANNUALIZED
B THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT
BEEN REDUCED DURING THE PERIODS SHOWN.
C TOTAL RETURNS DO NOT INCLUDE THE ACCOUNT CLOSEOUT FEE AND FOR
PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED.
D FMR AGREED TO REIMBURSE A PORTION OF THE FUND'S EXPENSES DURING THE
PERIOD. WITHOUT THIS REIMBURSEMENT, THE FUND'S EXPENSE RATIO WOULD
HAVE BEEN HIGHER.
E FMR OR THE FUND HAS ENTERED INTO VARYING ARRANGEMENTS WITH THIRD
PARTIES WHO EITHER PAID OR REDUCED A PORTION OF THE FUND'S EXPENSES.
F ONE MONTH ENDED NOVEMBER 30
G YEAR ENDED OCTOBER 31
FIDELITY NEW JERSEY MUNICIPAL MONEY MARKET FUND
PERFORMANCE: THE BOTTOM LINE
To evaluate a money market fund's historical performance, you can look
at either total return or yield. Total return reflects the change in
the value of an investment, assuming reinvestment of the fund's
dividend income. Yield measures the income paid by a fund. Since a
money market fund tries to maintain a $1 share price, yield is an
important measure of performance. If Fidelity had not reimbursed
certain fund expenses, the past 10 year total return would have been
lower.
CUMULATIVE TOTAL RETURNS
PERIODS ENDED NOVEMBER 30, PAST 1 YEAR PAST 5 YEARS PAST 10 YEARS
1999
FIDELITY NJ MUNICIPAL MONEY 2.68% 15.81% 36.74%
MARKET
New Jersey Tax-Free Money 2.46% 15.23% 37.99%
Market Funds Average
CUMULATIVE TOTAL RETURNS show the fund's performance in percentage
terms over a set period - in this case, one year, five years or ten
years. For example, if you had invested $1,000 in a fund that had a 5%
return over the past year, the value of your investment would be
$1,050. To measure how the fund's performance stacked up against its
peers, you can compare it to the New Jersey tax-free money market
funds average, which reflects the performance of municipal money
market funds with similar objectives tracked by IBC Financial Data,
Inc. The past one year average represents a peer group of 16 money
market funds.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED NOVEMBER 30, PAST 1 YEAR PAST 5 YEARS PAST 10 YEARS
1999
FIDELITY NJ MUNICIPAL MONEY 2.68% 2.98% 3.18%
MARKET
New Jersey Tax-Free Money 2.46% 2.87% 3.27%
Market Funds Average
AVERAGE ANNUAL TOTAL RETURNS take the fund's cumulative return and
show you what would have happened if the fund had performed at a
constant rate each year.
YIELDS
11/29/99 8/30/99 5/31/99 3/1/99 11/30/98
Fidelity New Jersey Municipal 3.05% 2.65% 2.65% 2.41% 2.70%
Money Market Fund
New Jersey Tax-Free Money 2.97% 2.40% 2.49% 2.21% 2.51%
Market Funds Average
Fidelity New Jersey Municipal 5.07% 4.43% 4.43% 4.02% 4.51%
Money Market Fund -
Tax-equivalent
Portion of fund's income 4.97% 9.61% 3.51% 17.39% 9.36%
subject to state taxes
YIELD refers to the income paid by the fund over a given period.
Yields for money market funds are usually for seven-day periods,
expressed as annual percentage rates. A yield that assumes income
earned is reinvested or compounded is called an effective yield. The
table above shows the fund's current seven-day yield at quarterly
intervals over the past year. You can compare these yields to the New
Jersey tax-free money market funds average as tracked by IBC Financial
Data, Inc. or you can look at the fund's tax-equivalent yield, which
is based on a combined effective 1999 federal and state income tax
rate of 40.08%. The fund's yields mentioned above reflect that a
portion of the fund's income was subject to state taxes. A portion of
the fund's income may be subject to the federal alternative minimum
tax.
(checkmark)COMPARING
PERFORMANCE
Yields on tax-free investments
are usually lower than yields
on taxable investments.
However, a straight
comparison between the two
may be misleading because it
ignores the way taxes reduce
taxable returns. Tax-equivalent
yield - the yield you would
have to earn on a similar
taxable investment to match the
tax-free yield - makes the
comparison more meaningful.
Keep in mind that the U.S.
government neither insures nor
guarantees a money market
fund. In fact, there is no
assurance that a money fund
will maintain a $1 share price.
FIDELITY NEW JERSEY MUNICIPAL MONEY MARKET FUND
FUND TALK: THE MANAGER'S OVERVIEW
(photograph of Scott Orr)
An interview with Scott Orr, Portfolio Manager of Fidelity New Jersey
Municipal Money Market Fund
Q. SCOTT, WHAT WAS THE INVESTMENT ENVIRONMENT LIKE OVER THE 12 MONTHS
THAT ENDED NOVEMBER 30, 1999?
A. At the beginning of the period, a global economic crisis continued
to cast a shadow over the market. There were many questions about the
pace of U.S. economic growth and the direction of interest rates.
Early in 1999, however, any doubts were put to rest, as both growth
and employment strengthened. In addition, data began to indicate that
inflation might not be as well-behaved as it had been in the recent
past. Faced with that backdrop, market observers began to feel that
the Federal Reserve Board would raise short-term interest rates to
slow growth and head off inflation. Through the rest of the period,
economic growth remained solid and unemployment stayed at historically
low levels. Such a tight labor market often leads to inflation, as
employers are forced to raise salaries in order to attract or retain
workers, passing on the additional cost to the consumer. The Fed
indicated that improvements in worker productivity had helped keep
inflation at bay. Nevertheless, with constant, broad-based economic
strength and continually tight labor markets, the Fed felt compelled
to take back all three of the rate cuts it had implemented in the fall
of 1998. It did so with a series of three 0.25 percentage point rate
hikes in June, August and November, raising the rate banks charge each
other for overnight loans - known as the fed funds rate - from 4.75%
at the beginning of the period to 5.50% by the end of November 1999.
Q. WHAT WAS YOUR STRATEGY AS THIS TRANSPIRED?
A. At the beginning of the period, the fund's average maturity was
neutral relative to its peers, given the uncertainty of the
interest-rate environment. Over the next few months, I let the average
maturity roll down as I avoided locking in the relatively low interest
rates we saw at that time. As rates began to move higher again in
March, however, I bought longer-term securities that adequately
reflected my expectations for higher interest rates. During the last
six months of the period, I returned the fund's average maturity to a
neutral position by spreading the fund's investments across all
segments of the short-term yield curve.
Q. WHY DID THE FUND INVEST OUT-OF-STATE?
A. The fund pursued this strategy - within the limits of the fund's
investment policies - in order to provide shareholders with a higher
tax-adjusted yield. In certain cases, yields on New Jersey obligations
were sufficiently low so that comparable out-of-state obligations
provided a higher tax-adjusted yield even though they are subject to
New Jersey tax. Even though more of shareholders' income for the
fund's 1999 fiscal year will be taxable than if I had purchased
exclusively New Jersey obligations, shareholders may be able to retain
more of the fund's dividends, after taxes are taken into account. The
fund may also invest out-of-state if there is a limited supply of New
Jersey obligations.
Q. HOW DID THE FUND PERFORM?
A. The fund's seven-day yield on November 30, 1999, was 3.05%,
compared to 2.70% 12 months ago. The more recent seven-day yield was
the equivalent of a 5.09% taxable rate of return for New Jersey
investors in the 40.08% combined state and federal income tax bracket.
The fund's yields reflect that a portion of the fund's income was
subject to state taxes. Through November 30, 1999, the fund's 12-month
total return was 2.68%, compared to 2.46% for the New Jersey tax-free
money market funds average, according to IBC Financial Data, Inc.
Q. WHAT IS YOUR OUTLOOK?
A. Before the Fed's most recent rate hike, market sentiment reflected
the belief that the Fed would sit back and wait to see what happens
after bringing rates back to their 1998 levels. However, judging by
its reaction to the latest Fed move, the market doesn't feel the Fed
is done implementing rate increases. If the trends of tight employment
and economic strength continue, I believe it is likely the Fed will
raise rates again in early 2000 to slow growth and prevent inflation
from cropping up. The timing and scope of any Fed rate hikes would
most probably be dictated by the pace of the economy and the tightness
of the labor market.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO
MANAGER ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON
THE COVER AND DO NOT NECESSARILY REPRESENT THE VIEWS OF FIDELITY OR
ANY OTHER PERSON IN THE FIDELITY ORGANIZATION. ANY SUCH VIEWS ARE
SUBJECT TO CHANGE AT ANY TIME BASED UPON MARKET OR OTHER CONDITIONS
AND FIDELITY DISCLAIMS ANY RESPONSIBILITY TO UPDATE SUCH VIEWS. THESE
VIEWS MAY NOT BE RELIED ON AS INVESTMENT ADVICE AND, BECAUSE
INVESTMENT DECISIONS FOR A FIDELITY FUND ARE BASED ON NUMEROUS
FACTORS, MAY NOT BE RELIED ON AS AN INDICATION OF TRADING INTENT ON
BEHALF OF ANY FIDELITY FUND.
(checkmark)FUND FACTS
GOAL: as high a level of current
income, exempt from federal
income tax and the New Jersey
Gross Income Tax, as is
consistent with preservation of
capital
FUND NUMBER: 417
TRADING SYMBOL: FNJXX
START DATE: March 17, 1988
SIZE: as of November 30,
1999, more than $697 million
MANAGER: Scott Orr, since
1997; manager, various
Fidelity and Spartan
municipal money market
funds; joined Fidelity in 1989
FIDELITY NEW JERSEY MUNICIPAL MONEY MARKET FUND
INVESTMENT CHANGES
<TABLE>
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MATURITY DIVERSIFICATION
DAYS % OF FUND'S INVESTMENTS % OF FUND'S INVESTMENTS 5/31/99 % OF FUND'S INVESTMENTS
11/30/99 11/30/98
0 - 30 56.4 65.4 62.7
31 - 90 26.0 10.8 11.3
91 - 180 9.3 5.9 15.5
181 - 397 8.3 17.9 10.5
WEIGHTED AVERAGE MATURITY
11/30/99 5/31/99 11/30/98
Fidelity New Jersey Municipal 52 DAYS 69 Days 56 Days
Money Market Fund
New Jersey Tax-Free Money 53 DAYS 55 Days 56 Days
Market Funds Average *
</TABLE>
<TABLE>
<CAPTION>
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ASSET ALLOCATION (% OF FUND'S
NET ASSETS)
AS OF NOVEMBER 30, 1999 AS OF MAY 31, 1999
Variable Rate Demand Notes Variable Rate Demand Notes
(VRDNs) 52.3% (VRDNs) 58.8%
Commercial Paper (including Commercial Paper (including
CP Mode) 18.0% CP Mode) 11.7%
Tender Bonds 2.7% Tender Bonds 0.4%
Municipal Notes 24.8% Municipal Notes 27.5%
Other Investments 0.0% Other Investments 0.4%
Net Other Assets 2.2% Net Other Assets 1.2%
Row: 1, Col: 1, Value: 52.3 Row: 1, Col: 1, Value: 58.8
Row: 1, Col: 2, Value: 0.0 Row: 1, Col: 2, Value: 0.0
Row: 1, Col: 3, Value: 18.0 Row: 1, Col: 3, Value: 11.7
Row: 1, Col: 4, Value: 2.7 Row: 1, Col: 4, Value: 0.4
Row: 1, Col: 5, Value: 24.8 Row: 1, Col: 5, Value: 27.5
Row: 1, Col: 6, Value: 0.0 Row: 1, Col: 6, Value: 0.4
Row: 1, Col: 7, Value: 0.0 Row: 1, Col: 7, Value: 0.0
Row: 1, Col: 8, Value: 2.2 Row: 1, Col: 8, Value: 1.2
</TABLE>
PRIOR TO THIS REPORT, CERTAIN INFORMATION RELATED TO PORTFOLIO
HOLDINGS WAS STATED AS A PERCENTAGE OF THE FUND'S INVESTMENTS.
FIDELITY NEW JERSEY MUNICIPAL MONEY MARKET FUND
INVESTMENTS NOVEMBER 30, 1999
Showing Percentage of Net Assets
<TABLE>
<CAPTION>
<S> <C> <C> <C>
MUNICIPAL SECURITIES - 97.8%
PRINCIPAL AMOUNT VALUE (NOTE 1)
DELAWARE - 0.2%
Delaware Econ. Dev. Auth. $ 1,500,000 $ 1,500,000
Rev. (Delmarva Pwr. & Lt.
Co. Proj.) Series 1988,
3.85%, VRDN (a)(b)
KENTUCKY - 0.3%
Louisville & Jefferson County 1,900,000 1,900,000
Reg'l. Arpt. Auth. Series
1999 A, 3.75% (United Parcel
Svc. of America Guaranteed),
VRDN (a)(b)
LOUISIANA - 0.3%
Calcasieu Parish Ind. Dev. 2,200,000 2,200,000
Board Envir. Rev. (Citgo
Petroleum Corp. Proj.) 3.9%,
LOC Banque Nationale de
Paris, VRDN (a)(b)
NEVADA - 0.3%
Washoe County Gas Facilities 1,800,000 1,800,000
Rev. (Sierra Pacific Pwr.
Co. Proj.) Series 1990,
3.9%, LOC UBS AG, VRDN (a)(b)
NEW JERSEY - 74.9%
Bethlehem Township Gen. 3,304,000 3,314,219
Oblig. BAN 4.25% 9/20/00
Bloomfield Township Gen. 5,800,000 5,800,625
Oblig. BAN 3.8% 6/28/00
Brick Township Gen. Oblig. 8,781,000 8,793,509
BAN 3.4% 5/12/00
Burlington County Gen. Oblig.
BAN:
3.5% 4/21/00 2,800,000 2,804,205
3.75% 8/11/00 4,800,000 4,810,622
Camden County Impt. Auth. Rev.:
(Jewish Cmnty. Ctr. Proj.) 1,800,000 1,800,000
Series 1995, 3.85%, LOC
Nat'l. Westminster Bank PLC,
VRDN (a)
(Parkview Redev. Hsg. Proj.) 12,800,000 12,800,000
3.85%, LOC Gen. Elec. Cap.
Corp., VRDN (a)(b)
Clifton Gen. Oblig. BAN:
3.5% 3/31/00 2,300,000 2,303,545
4% 8/18/00 6,300,000 6,319,957
Cranford Township Gen. Oblig. 3,000,000 3,003,827
BAN 3.5% 3/17/00
Delaware River Port Auth. 10,940,000 10,940,000
Pennsylvania and New Jersey
Rev. Participating VRDN
Series SG 53, 3.98%
(Liquidity Facility Societe
Generale, France) (a)(c)
East Brunswick Township Gen.
Oblig. BAN:
3.25% 3/31/00 8,500,000 8,506,819
3.9% 8/10/00 3,212,000 3,220,572
4.25% 10/13/00 5,660,000 5,685,021
Essex County Impt. Auth. 3,150,000 3,150,000
Participating VRDN Series
FRRI A27, 3.9% (Liquidity
Facility Bank of New York
NA) (a)(c)
Fair Lawn Gen. Oblig. BAN 4,563,500 4,563,899
3.25% 12/16/99
Fairfield Township Gen. 2,025,000 2,026,196
Oblig. BAN 3.4% 3/22/00
MUNICIPAL SECURITIES -
CONTINUED
PRINCIPAL AMOUNT VALUE (NOTE 1)
NEW JERSEY - CONTINUED
Hudson County Impt. Auth. $ 28,795,000 $ 28,795,000
Rev. (Essential Purp. Pooled
Govt. Ln. Prog.) Series
1986, 3.85%, LOC First Union
Nat'l. Bank, North Carolina,
VRDN (a)
Jefferson Township Gen. 3,200,000 3,209,530
Oblig. BAN 4% 7/14/00
Lakewood Township Gen. Oblig. 3,172,788 3,173,603
BAN 3.4% 1/14/00
Margate City Gen. Oblig. BAN:
3.5% 3/24/00 2,700,000 2,702,935
4% 8/17/00 5,200,000 5,214,965
Medford Township Gen. Oblig. 3,500,000 3,500,103
BAN 3.13% 1/7/00
Mercer County Impt. Auth. BAN 2,661,000 2,661,000
(Parking Facilities Proj.)
Series 1999, 3.6% 1/12/00
Mercer County Impt. Auth. 16,000,000 16,000,000
Rev. (Atlantic Foundation &
Johnson Proj.) Series 1998,
3.8% (MBIA Insured), VRDN (a)
Middlesex County Gen. Oblig. 27,200,000 27,205,875
BAN 3.25% 1/24/00
Montclair Township Gen.
Oblig. BAN:
3.4% 2/15/00 4,000,000 4,002,901
3.5% 1/21/00 4,323,000 4,325,809
3.5% 3/10/00 1,671,000 1,673,123
Montgomery Township Gen. 3,500,000 3,500,176
Oblig. BAN Series 1998,
3.25% 12/10/99
Moorestown Township Gen. 5,200,000 5,207,597
Oblig. BAN 3.5% 6/2/00
New Jersey Econ. Dev. Auth.
Econ. Dev. Rev.:
(Ctr. for Aging Applewood 2,275,000 2,275,000
Proj.) Series 1989, 3.84%,
LOC Fleet Nat'l. Bank, VRDN
(a)
(Headquarters Proj.) Series 4,600,000 4,600,000
1997, 3.8%, LOC PNC Bank
NA, VRDN (a)
(PVC Container Corp. Proj.) 935,000 935,000
Series 1987 D, 3.95%, LOC
Nat'l. Westminster Bank PLC,
VRDN (a)(b)
New Jersey Econ. Dev. Auth. 300,000 300,000
Ind. & Econ. Dev. Rev. (Casa
Di Bertacchi Corp. Proj.)
Series 1988, 4%, LOC HSBC
Bank USA, VRDN (a)(b)
New Jersey Econ. Dev. Auth. 5,000,000 5,000,000
Natural Gas Facilities Rev.
Participating VRDN Series
1998 161, 3.92% (Liquidity
Facility Morgan Stanley Dean
Witter & Co.) (a)(b)(c)
New Jersey Econ. Dev. Auth. 3,000,000 3,000,000
Poll. Cont. Rev. (Hoffman-
La Roche Inc. Proj.) Series
1985, 3.85%, LOC Wachovia
Bank NA, VRDN (a)
New Jersey Econ. Dev. Auth.
Rev.:
Bonds:
(Chambers Cogeneration LTP
Proj.) Series 1991:
3.45% tender 1/31/00, LOC Cr. 3,200,000 3,200,000
Local de France, CP mode (b)
MUNICIPAL SECURITIES -
CONTINUED
PRINCIPAL AMOUNT VALUE (NOTE 1)
NEW JERSEY - CONTINUED
New Jersey Econ. Dev. Auth.
Rev.: - continued
3.45% tender 2/10/00, LOC Cr. $ 16,300,000 $ 16,300,000
Local de France, CP mode (b)
(Keystone Proj.) Series 1992, 4,100,000 4,100,000
3.6% tender 1/31/00, LOC
UBS AG, CP mode (b)
Participating VRDN Series 6,000,000 6,000,000
1998 184, 3.87% (Liquidity
Facility Morgan Stanley Dean
Witter & Co.) (a)(c)
(Bayshore Health Ctr. Proj.) 7,275,000 7,275,000
Series 1998 A, 3.9%, LOC
Kredietbank NV, VRDN (a)
(Jewish Home Rockleigh Proj.) 7,430,000 7,430,000
Series B, 3.8%, LOC PNC Bank
NA, VRDN (a)
New Jersey Econ. Dev. Auth. 7,825,000 7,825,000
Wtr. Facilities Rev.
Participating VRDN Series
FRRI 35, 4% (Liquidity
Facility Bank of New York
NA) (a)(b)(c)
New Jersey Ed. Dev. Auth. 9,100,000 9,100,000
Bonds Series 1999 82, 3.75%,
tender 1/19/00 (Liquidity
Facility The Bear Stearns
Companies, Inc.) (c)
New Jersey Edl. Facilities 12,455,000 12,455,000
Auth. Rev. (College of New
Jersey Proj.) Series 1999 A,
3.75% (AMBAC Insured), VRDN
(a)
New Jersey Gen. Oblig.:
Participating VRDN Series 7,000,000 7,000,000
1999 3, 3.97% (Liquidity
Facility Toronto Dominion
Bank) (a)(c)
Series Fiscal 2000 A:
3.7% 3/1/00, CP 13,000,000 13,000,000
3.8% 1/18/00, CP 24,000,000 24,000,000
3.8% 1/27/00, CP 23,300,000 23,300,000
3.9% 1/19/00, CP 14,000,000 14,000,000
3.9% 2/1/00, CP 16,000,000 16,000,000
3.7% 3/1/00, CP 6,600,000 6,600,000
New Jersey Higher Ed. Auth. 10,410,000 10,410,000
Student Ln. Rev.
Participating VRDN Series
1998 18, 3.92% (Liquidity
Facility Morgan Stanley Dean
Witter & Co.) (a)(c)
New Jersey Hsg. & Mtg. Fin.
Agcy. Rev.:
Bonds Series PA 117, 3.75%, 3,360,000 3,360,000
tender 2/24/00 (Liquidity
Facility Merrill Lynch &
Co., Inc.) (b)(c)(d)
Participating VRDN:
Series 1999 V, 3.99% 6,700,000 6,700,000
(Liquidity Facility Bank of
America NA) (a)(b)(c)
Series PT 118, 3.93% 22,505,000 22,505,000
(Liquidity Facility Banco
Santander SA) (a)(b)(c)
Series PT 92, 3.93% 8,590,000 8,590,000
(Liquidity Facility Merrill
Lynch & Co., Inc.) (a)(b)(c)
MUNICIPAL SECURITIES -
CONTINUED
PRINCIPAL AMOUNT VALUE (NOTE 1)
NEW JERSEY - CONTINUED
New Jersey Sport and $ 6,100,000 $ 6,100,000
Exposition Auth. Rev.
Participating VRDN Series
FRRI A3, 3.95% (Liquidity
Facility Commerzbank AG)
(a)(c)
New Jersey Trans. Trust Fund
Auth.:
Participating VRDN Series 5,000,000 5,000,000
1999 84, 3.95% (Liquidity
Facility The Bear Stearns
Companies, Inc.) (a)(c)
Bonds (Trans. Sys. Proj.) 6,400,000 6,400,000
Series A 1999 80, 3.75%,
tender 2/7/00 (Liquidity
Facility The Bear Stearns
Companies, Inc.) (c)
North Brunswick Township Gen. 3,250,000 3,250,051
Oblig. BAN 3.75% 12/6/99
Readington Township Gen. 6,439,000 6,447,122
Oblig. BAN 3.4% 4/28/00
Red Bank Borough Gen. Oblig. 3,000,000 3,006,220
BAN 4.125% 11/16/00
Ringwood Boro Gen. Oblig. BAN 3,000,000 3,003,995
3.5% 3/17/00
Salem County Ind. Poll. Cont. 7,660,000 7,660,000
Fing. Auth. Poll. Cont. Rev.
Participating VRDN Series PA
357, 3.88% (Liquidity
Facility Merrill Lynch &
Co., Inc.) (a)(c)
Secaucus Gen. Oblig. BAN 3.4% 3,986,000 3,990,145
6/1/00
Union County Util. Auth. 6,260,000 6,260,000
Solid Waste Facilities Lease
Rev. Participating VRDN
Series FRRI 38, 4%
(Liquidity Facility Bank of
New York NA) (a)(b)(c)
Vernon Township Gen. Oblig. 8,900,000 8,900,181
Board of Ed. BAN 3.5% 12/3/99
Voorhees Township Gen. Oblig. 3,300,000 3,302,550
BAN 4% 2/8/00
Warren County Gen. Oblig. BAN 2,800,000 2,800,373
3.17% 4/7/00
West Milford Township Gen. 3,976,000 3,978,529
Oblig. BAN 3.5% 1/21/00
Woodbridge Township Gen. 6,600,000 6,620,888
Oblig. BAN 3.9% 7/28/00
522,995,687
NEW YORK & NEW JERSEY - 19.0%
Port Auth. New York & New
Jersey:
Participating VRDN:
Series FRRI 3, 4% (Liquidity 10,660,000 10,660,000
Facility Bank of New York
NA) (a)(b)(c)
Series PT 232, 3.93% 4,200,000 4,200,000
(Liquidity Facility
Commerzbank AG) (a)(b)(c)
Series SG 52, 3.93% 4,600,000 4,600,000
(Liquidity Facility Societe
Generale, France) (a)(b)(c)
Series 1991, 3.9519%, VRDN 8,800,000 8,800,000
(a)(b)(d)
Series 1992, 3.725%, VRDN 6,800,000 6,800,000
(a)(d)
Series 1995, 3.725%, VRDN 9,400,000 9,400,000
(a)(b)(d)
MUNICIPAL SECURITIES -
CONTINUED
PRINCIPAL AMOUNT VALUE (NOTE 1)
NEW YORK & NEW JERSEY -
CONTINUED
Port Auth. New York & New
Jersey: - continued
Series 1996 2, 4.05%, VRDN $ 3,500,000 $ 3,500,000
(a)(b)
Series 1997 1, 3.725%, VRDN 8,900,000 8,900,000
(a)(d)
Series 1997 1A, 3.95%, VRDN 2,800,000 2,800,000
(a)
Series A, 3.45% 1/26/00, CP 5,935,000 5,935,000
(b)
Port Auth. New York & New
Jersey Spl. Oblig. Rev.
Participating VRDN:
Series FRRI 16, 4% (Liquidity 6,200,000 6,200,000
Facility Bank of New York
NA) (a)(b)(c)
Series SG 117, 3.93% 20,400,000 20,400,000
(Liquidity Facility Societe
Generale, France) (a)(b)(c)
Series SG 92, 3.93% 3,200,000 3,200,000
(Liquidity Facility Societe
Generale, France) (a)(b)(c)
Series SG 94, 3.93% 37,490,000 37,489,999
(Liquidity Facility Societe
Generale, France) (a)(b)(c)
132,884,999
PUERTO RICO - 0.5%
Puerto Rico Commonwealth Hwy. 3,210,000 3,210,000
& Trans. Auth. Hwy. Rev.
Participating VRDN Series ML
PA 507, 3.71% (Liquidity
Facility Merrill Lynch &
Co., Inc.) (a)(c)
TEXAS - 2.3%
Brazos River Auth. Poll. 2,000,000 2,000,000
Cont. Rev. (Texas Utils.
Elec. Co. Proj.) Series 1996
B, 4.1% (AMBAC Insured) (BPA
Bank of New York NA), VRDN
(a)(b)
Brazos River Hbr. Navigation 1,600,000 1,600,000
District of Brazoria County
Rev. (Dow Chemical Co.
Proj.) Series 1997, 3.95%,
VRDN (a)(b)
Gulf Coast Waste Disp. Auth.
Poll. Cont. Rev. (Amoco Oil
Co. Proj.):
Series 1994, 3.85%, VRDN 6,000,000 6,000,000
(a)(b)
Series 1995, 3.85%, VRDN 4,200,000 4,200,000
(a)(b)
MUNICIPAL SECURITIES -
CONTINUED
PRINCIPAL AMOUNT VALUE (NOTE 1)
TEXAS - CONTINUED
Harris County Health $ 1,000,000 $ 1,000,000
Facilities Dev. Corp. Rev.
(Saint Luke's Hosp.) Series
B, 3.7%, VRDN (a)
Port Corpus Christi Ind. Dev. 1,400,000 1,400,000
Corp. Rev. (Citgo Petroleum
Proj.) Series 1996, 3.9%,
LOC Banque Nationale de
Paris, VRDN (a)(b)
16,200,000
TOTAL INVESTMENT PORTFOLIO - 682,690,686
97.8%
(Cost $682,690,686)
NET OTHER ASSETS - 2.2% 15,235,332
NET ASSETS - 100% $ 697,926,018
Total Cost for Income Tax Purposes $ 682,690,686
</TABLE>
SECURITY TYPE ABBREVIATIONS
BAN - BOND ANTICIPATION NOTE
VRDN - VARIABLE RATE DEMAND NOTE
LEGEND
(a) The coupon rate shown on floating or adjustable rate securities
represents the rate at period end.
(b) Private activity obligations whose interest is subject to the
federal alternative minimum tax for individuals.
(c) Provides evidence of ownership in one or more underlying municipal
bonds.
(d) Restricted securities - Investment in securities not registered
under the Securities Act of 1933.
Additional information on each holding is as follows:
SECURITY ACQUISITION DATE COST
New Jersey Hsg. & Mtg. Fin. 8/24/99 $ 3,360,000
Agcy. Rev. Bonds Series PA
117, 3.75%, tender 2/24/00
(Liquidity Facility Merrill
Lynch & Co., Inc.)
Port Auth. New York & New 6/18/91 $ 8,800,000
Jersey Series 1991, 3.9519%,
VRDN
Port Auth. New York & New 2/14/92 $ 6,800,000
Jersey Series 1992, 3.725%,
VRDN
Port Auth. New York & New 9/15/95 $ 9,400,000
Jersey Series 1995, 3.725%,
VRDN
Port Auth. New York & New 9/15/97 $ 8,900,000
Jersey Series 1997 1,
3.725%, VRDN
OTHER INFORMATION
The fund invested in securities that are not registered under the
Securities Act of 1933. These securities are subject to legal or
contractual restrictions on resale. At the end of the period,
restricted securities (excluding Rule 144A issues) amounted to
$37,260,000 and 5.3% of net assets.
INCOME TAX INFORMATION
At November 30, 1999, the fund had a capital loss carryforward of
approximately $1,000 all of which will expire on November 30, 2005.
During the fiscal year ended November 30, 1999, 100% of the fund's
income dividends was free from federal income tax, and 35.77% of the
fund's income dividends was subject to the federal alternative minimum
tax (unaudited).
The fund will notify shareholders in January 2000 of amounts for use
in preparing 1999 income tax returns.
FIDELITY NEW JERSEY MUNICIPAL MONEY MARKET FUND
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
NOVEMBER 30, 1999
ASSETS
Investment in securities, at $ 682,690,686
value - See accompanying
schedule
Cash 19,941
Receivable for fund shares 12,972,640
sold
Interest receivable 7,000,786
Prepaid expenses 2,205
TOTAL ASSETS 702,686,258
LIABILITIES
Payable for fund shares $ 4,354,861
redeemed
Distributions payable 33,652
Accrued management fee 217,399
Other payables and accrued 154,328
expenses
TOTAL LIABILITIES 4,760,240
NET ASSETS $ 697,926,018
Net Assets consist of:
Paid in capital $ 697,926,418
Accumulated net realized gain (400)
(loss) on investments
NET ASSETS, for 697,926,481 $ 697,926,018
shares outstanding
NET ASSET VALUE, offering $1.00
price and redemption price
per share ($697,926,018
(divided by) 697,926,481
shares)
STATEMENT OF OPERATIONS
YEAR ENDED NOVEMBER 30, 1999
INTEREST INCOME $ 21,200,919
EXPENSES
Management fee $ 2,493,900
Transfer agent fees 1,044,654
Accounting fees and expenses 101,170
Non-interested trustees' 2,091
compensation
Custodian fees and expenses 28,417
Registration fees 54,674
Audit 23,843
Legal 33,854
Miscellaneous 23,797
Total expenses before 3,806,400
reductions
Expense reductions (9,930) 3,796,470
NET INTEREST INCOME 17,404,449
NET REALIZED GAIN (LOSS) ON 40,402
INVESTMENTS
NET INCREASE IN NET ASSETS $ 17,444,851
RESULTING FROM OPERATIONS
<TABLE>
<CAPTION>
<S> <C> <C>
STATEMENT OF CHANGES IN NET ASSETS
YEAR ENDED NOVEMBER 30, 1999 YEAR ENDED NOVEMBER 30, 1998
INCREASE (DECREASE) IN NET
ASSETS
Operations Net interest income $ 17,404,449 $ 15,601,509
Net realized gain (loss) 40,402 14,434
NET INCREASE (DECREASE) IN 17,444,851 15,615,943
NET ASSETS RESULTING FROM
OPERATIONS
Distributions to shareholders (17,404,449) (15,601,509)
from net interest income
Share transactions at net 2,306,661,152 1,801,008,658
asset value of $1.00 per
share Proceeds from sales of
shares
Reinvestment of 17,049,675 15,168,608
distributions from net
interest income
Cost of shares redeemed (2,216,315,325) (1,713,362,802)
NET INCREASE (DECREASE) IN 107,395,502 102,814,464
NET ASSETS AND SHARES
RESULTING FROM SHARE
TRANSACTIONS
TOTAL INCREASE (DECREASE) 107,435,904 102,828,898
IN NET ASSETS
NET ASSETS
Beginning of period 590,490,114 487,661,216
End of period $ 697,926,018 $ 590,490,114
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
FINANCIAL HIGHLIGHTS
YEARS ENDED NOVEMBER 30, 1999 1998 1997 1996 1995
SELECTED PER-SHARE DATA
Net asset value, beginning $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
of period
Income from Investment .026 .029 .030 .029 .033
Operations Net interest
income
Less Distributions
From net interest income (.026) (.029) (.030) (.029) (.033)
Net asset value, end of period $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
TOTAL RETURN A 2.68% 2.93% 3.03% 2.93% 3.33%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 697,926 $ 590,490 $ 487,661 $ 423,224 $ 434,709
(000 omitted)
Ratio of expenses to average .58% .60% .61% .63% .62%
net assets
Ratio of expenses to average .58% .59% B .61% .61% B .62%
net assets after expense
reductions
Ratio of net interest income 2.65% 2.90% 2.98% 2.89% 3.28%
to average net assets
</TABLE>
A THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT
BEEN REDUCED DURING THE PERIODS SHOWN.
B FMR OR THE FUND HAS ENTERED INTO VARYING ARRANGEMENTS WITH THIRD
PARTIES WHO EITHER PAID OR REDUCED A PORTION OF THE FUND'S EXPENSES.
NOTES TO FINANCIAL STATEMENTS
For the period ended November 30, 1999
1. SIGNIFICANT ACCOUNTING POLICIES.
Spartan New Jersey Municipal Income Fund (the income fund) is a fund
of Fidelity Court Street Trust. Spartan New Jersey Municipal Money
Market Fund and Fidelity New Jersey Municipal Money Market Fund (the
money market funds) are funds of Fidelity Court Street Trust II. Each
trust is registered under the Investment Company Act of 1940, as
amended (the 1940 Act), as an open-end management investment company.
Fidelity Court Street Trust and Fidelity Court Street Trust II (the
trusts) are organized as a Massachusetts business trust and a Delaware
business trust, respectively. Each fund is authorized to issue an
unlimited number of shares. The financial statements have been
prepared in conformity with generally accepted accounting principles
which require management to make certain estimates and assumptions at
the date of the financial statements. Each fund may be affected by
economic and political developments in the state of New Jersey. The
following summarizes the significant accounting policies of the income
fund and the money market funds:
SECURITY VALUATION.
INCOME FUND. Securities are valued based upon a computerized matrix
system and/or appraisals by a pricing service, both of which consider
market transactions and dealer-supplied valuations. Securities
(including restricted securities) for which quotations are not readily
available are valued at their fair value as determined in good faith
under consistently applied procedures under the general supervision of
the Board of Trustees. Short-term securities with remaining maturities
of sixty days or less for which quotations are not readily available
are valued at amortized cost or original cost plus accrued interest,
both of which approximate current value.
MONEY MARKET FUNDS. As permitted under Rule 2a-7 of the 1940 Act, and
certain conditions therein, securities are valued initially at cost
and thereafter assume a constant amortization to maturity of any
discount or premium.
INCOME TAXES. As a qualified regulated investment company under
Subchapter M of the Internal Revenue Code, each fund is not subject to
income taxes to the extent that it distributes substantially all of
its taxable income for the fiscal year. The schedules of investments
include information regarding income taxes under the caption "Income
Tax Information."
INTEREST INCOME. Interest income, which includes amortization of
premium and accretion of original issue discount, is accrued as
earned. For the money market funds, accretion of discount represents
unrealized gain until realized at the time of a security disposition
or maturity.
EXPENSES. Most expenses of each trust can be directly attributed to a
fund. Expenses which cannot be directly attributed are apportioned
among the funds in the trust.
DISTRIBUTIONS TO SHAREHOLDERS. Dividends are declared daily and paid
monthly from net interest income. Distributions to shareholders from
realized capital gains on investments, if any, are recorded on the
ex-dividend date.
1. SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
DISTRIBUTIONS TO SHAREHOLDERS - CONTINUED
Income and capital gain distributions are determined in accordance
with income tax regulations which may differ from generally accepted
accounting principles. These differences, which may result in
distribution reclassifications, are primarily due to differing
treatments for futures transactions and losses deferred due to
futures.
Permanent book and tax basis differences relating to shareholder
distributions will result in reclassifications to paid in capital and
may affect the per-share allocation between net interest income and
realized and unrealized gain (loss). Accumulated undistributed net
realized gain (loss) on investments may include temporary book and tax
basis differences that will reverse in a subsequent period. Any
taxable income or gain remaining at fiscal year end is distributed in
the following year.
SHORT-TERM TRADING (REDEMPTION) FEES. Shares held in the income fund
less than 180 days are subject to a short-term trading fee equal to
.50% of the proceeds of the redeemed shares. The fee, which is
retained by the fund, is accounted for as an addition to paid in
capital.
SECURITY TRANSACTIONS. Security transactions are accounted for as of
trade date. Gains and losses on securities sold are determined on the
basis of identified cost.
2. OPERATING POLICIES.
MUNICIPAL CENTRAL CASH FUND. Pursuant to an Exemptive Order issued by
the Securities and Exchange Commission (the SEC), the funds may invest
in the Municipal Central Cash Fund (the Cash Fund) managed by Fidelity
Investments Money Management, Inc. (FIMM), an affiliate of Fidelity
Management & Research Company (FMR). The Cash Fund is an open-end
money market fund available only to investment companies and other
accounts managed by FMR and its affiliates. The Cash Fund seeks
preservation of capital, liquidity, and current income by investing in
high-quality, short-term municipal securities of various states and
municipalities. Income distributions from the Cash Fund are declared
daily and paid monthly from net interest income. Income distributions
earned by the funds are recorded as interest income in the
accompanying financial statements.
WHEN-ISSUED SECURITIES. Each fund may purchase or sell securities on a
when-issued basis. Payment and delivery may take place after the
customary settlement period for that security. The price of the
underlying securities is fixed at the time the transaction is
negotiated. Each fund may receive compensation for interest forgone in
the purchase of a when-issued security. With respect to purchase
commitments, each fund identifies securities as segregated in its
records with a value at least equal to the amount of the commitment.
Losses may arise due to changes in the value of the underlying
securities, if
2. OPERATING POLICIES - CONTINUED
WHEN-ISSUED SECURITIES - CONTINUED
the counterparty does not perform under the contract, or if the issuer
does not issue the securities due to political, economic, or other
factors.
FUTURES CONTRACTS. The income fund may use futures contracts to manage
its exposure to the bond market and to fluctuations in interest rates.
Buying futures tends to increase a fund's exposure to the underlying
instrument, while selling futures tends to decrease a fund's exposure
to the underlying instrument or hedge other fund investments. Futures
contracts involve, to varying degrees, risk of loss in excess of the
futures variation margin reflected in the Statement of Assets and
Liabilities. The underlying face amount at value of any open futures
contracts at period end is shown in the schedule of investments under
the caption "Futures Contracts." This amount reflects each contract's
exposure to the underlying instrument at period end. Losses may arise
from changes in the value of the underlying instruments or if the
counterparties do not perform under the contracts' terms. Gains
(losses) are realized upon the expiration or closing of the futures
contracts. Futures contracts are valued at the settlement price
established each day by the board of trade or exchange on which they
are traded.
RESTRICTED SECURITIES. Certain funds are permitted to invest in
securities that are subject to legal or contractual restrictions on
resale. These securities generally may be resold in transactions
exempt from registration or to the public if the securities are
registered. Disposal of these securities may involve time-consuming
negotiations and expense, and prompt sale at an acceptable price may
be difficult. Information regarding restricted securities is included
under the caption "Other Information" at the end of each applicable
fund's schedule of investments.
3. PURCHASES AND SALES OF INVESTMENTS.
INCOME FUND. Purchases and sales of securities, other than short-term
securities, aggregated $74,301,039 and $72,888,541, respectively.
The market value of futures contracts opened and closed during the
period amounted to $33,502,901 and $32,843,185, respectively.
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES.
MANAGEMENT FEE. As the investment adviser for Fidelity New Jersey
Municipal Money Market Fund, FMR receives a monthly fee that is
calculated on the basis of a group fee rate plus a fixed individual
fund fee rate applied to the average net assets of the fund. The group
fee rate is the weighted average of a series of rates and is based on
the monthly average net assets of all the mutual funds advised by FMR.
The rates ranged from .0920% to .3700% for the period. The annual
individual fund fee rate is .25%. In the event that these rates were
lower than the
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES - CONTINUED
MANAGEMENT FEE - CONTINUED
contractual rates in effect during the period, FMR voluntarily
implemented the above rates, as they resulted in the same or a lower
management fee. For the period, the management fee was equivalent to
an annual rate of .38% of average net asset for Fidelity New Jersey
Municipal Money Market Fund.
As the investment advisor for the income fund and Spartan New Jersey
Municipal Money Market Fund, FMR receives a fee that is computed daily
at an annual rate of.55% and .50% of average net assets for Spartan
New Jersey Municipal Income Fund and Spartan New Jersey Municipal
Money Market Fund, respectively. FMR pays all other expenses, except
the compensation of the non-interested Trustees and certain exceptions
such as interest, taxes, brokerage commissions and extraordinary
expenses. The management fee paid to FMR by the income fund and
Spartan New Jersey Municipal Money Market Fund is reduced by an amount
equal to the fees and expenses paid by the fund to the non-interested
Trustees.
FMR also bears the cost of providing shareholder services to Spartan
New Jersey Municipal Money Market Fund. To offset the cost of
providing these services, FMR or its affiliates collected certain
transaction fees from shareholders which amounted to $4,235.
SUB-ADVISER FEE. As the income fund's and the money market funds'
investment sub-adviser, FIMM, a wholly owned subsidiary of FMR,
receives a fee from FMR of 50% of the management fee payable to FMR.
The fee is paid prior to any voluntary expense reimbursements which
may be in effect.
TRANSFER AGENT AND ACCOUNTING FEES. Effective June 21, 1999,
Citibank, N.A. (Citibank) replaced UMB Bank, n.a. as the custodian,
transfer agent and shareholder servicing agent for Fidelity New Jersey
Municipal Money Market Fund. Citibank has entered into a sub-contract
with Fidelity Service Company, Inc. (FSC), an affiliate of FMR, under
which FSC performs the activities associated with the fund's transfer
and shareholder servicing agent and accounting functions. Fidelity New
Jersey Municipal Money Market Fund pays account fees and asset-based
fees that vary according to account size and type of account. FSC pays
for typesetting, printing and mailing of all shareholder reports,
except proxy statements. The accounting fee is based on the level of
average net assets for the month plus out-of-pocket expenses.
For the period, the transfer agent fees were equivalent to an annual
rate of .16% of average net assets for Fidelity New Jersey Municipal
Money Market Fund.
MONEY MARKET INSURANCE. Pursuant to an Exemptive Order issued by the
the SEC, the money market funds, along with other money market funds
advised by FMR or its affiliates, have entered into insurance
agreements with FIDFUNDS Mutual Limited (FIDFUNDS), an affiliated
mutual insurance company, effective January 1, 1999. FIDFUNDS provides
limited coverage for certain loss events
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES - CONTINUED
MONEY MARKET INSURANCE -
CONTINUED
including issuer default as to payment of principal or interest and
bankruptcy or insolvency of a credit enhancement provider. The
insurance does not cover losses resulting from changes in interest
rates, ratings downgrades or other market conditions. Each money
market fund may be subject to a special assessment of up to
approximately 2.5 times the fund's annual gross premium if covered
losses exceed certain levels. Fidelity New Jersey Municipal Money
Market Fund paid premiums of $26,459 to FIDFUNDS, which are being
amortized over one year. FMR has borne the cost of Spartan New Jersey
Municipal Money Market Fund's premium payable to FIDFUNDS.
5. EXPENSE REDUCTIONS.
Through arrangements with the funds' custodian and transfer agent,
credits realized as a result of uninvested cash balances were used to
reduce a portion of each fund's expenses. During the period, the
income fund's, Spartan New Jersey Municipal Money Market Fund's and
Fidelity New Jersey Municipal Money Market Fund's expenses were
reduced by $17,340, $6,180 and $9,930, respectively, under these
arrangements.
Effective January 1, 2000, FMR voluntarily agreed to reimburse
operating expenses (excluding interest, taxes, brokerage commissions
and extraordinary expenses, if any) for the income fund above an
annual rate of .53% of the fund's average net assets.
REPORT OF INDEPENDENT ACCOUNTANTS
To the Trustees of Fidelity Court Street Trust and Fidelity Court
Street Trust II and the Shareholders of Spartan New Jersey Municipal
Income Fund, Spartan New Jersey Municipal Money Market Fund and
Fidelity New Jersey Municipal Money Market Fund:
In our opinion, the accompanying statements of assets and liabilities,
including the schedules of investments, and the related statements of
operations and of changes in net assets and the financial highlights
present fairly, in all material respects, the financial position of
Spartan New Jersey Municipal Income Fund (a fund of Fidelity Court
Street Trust) and Spartan New Jersey Municipal Money Market Fund and
Fidelity New Jersey Municipal Money Market Fund (funds of Fidelity
Court Street II Trust) at November 30, 1999, and the results of their
operations, the changes in their net assets and the financial
highlights for the periods indicated, in conformity with generally
accepted accounting principles. These financial statements and
financial highlights (hereafter referred to as "financial statements")
are the responsibility of each fund's management; our responsibility
is to express an opinion on these financial statements based on our
audits. We conducted our audits of these financial statements in
accordance with generally accepted auditing standards which require
that we plan and perform the audit to obtain reasonable assurance
about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements,
assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement
presentation. We believe that our audits, which included confirmation
of securities at November 30, 1999 by correspondence with the
custodian and brokers, provide a reasonable basis for the opinion
expressed above.
/s/PricewaterhouseCoopers LLP
PricewaterhouseCoopers LLP
Boston, Massachusetts
January 10, 2000
PROXY VOTING RESULTS
A special meeting of the fund's shareholders was held on December 15,
1999. The results of votes taken among shareholders on proposals
before them are reported below. Each vote reported represents one
dollar of net asset value held on the record date for the meeting.
PROPOSAL 1
To elect as Trustees the following twelve nominees.*
# OF % OF
VOTES CAST VOTES CAST
RALPH F. COX
Affirmative 3,135,419,311.04 97.006
Withheld 96,777,025.22 2.994
TOTAL 3,232,196,336.26 100.000
PHYLLIS BURKE DAVIS
Affirmative 3,132,582,110.71 96.918
Withheld 99,614,225.55 3.082
TOTAL 3,232,196,336.26 100.000
ROBERT M. GATES
Affirmative 3,135,664,806.55 97.013
Withheld 96,531,529.71 2.987
TOTAL 3,232,196,336.26 100.000
EDWARD C. JOHNSON 3D
Affirmative 3,134,639,545.56 96.982
Withheld 97,556,790.70 3.018
TOTAL 3,232,196,336.26 100.000
DONALD J. KIRK
Affirmative 3,136,284,719.58 97.033
Withheld 95,911,616.68 2.967
TOTAL 3,232,196,336.26 100.000
NED C. LAUTENBACH
Affirmative 3,137,914,510.94 97.083
Withheld 94,281,825.32 2.917
TOTAL 3,232,196,336.26 100.000
# OF % OF
VOTES CAST VOTES CAST
PETER S. LYNCH
Affirmative 3,138,556,508.13 97.103
Withheld 93,639,828.13 2.897
TOTAL 3,232,196,336.26 100.000
WILLIAM O. MCCOY
Affirmative 3,136,319,971.15 97.034
Withheld 95,876,365.11 2.966
TOTAL 3,232,196,336.26 100.000
GERALD C. MCDONOUGH
Affirmative 3,128,315,051.03 96.786
Withheld 103,881,285.23 3.214
TOTAL 3,232,196,336.26 100.000
MARVIN L. MANN
Affirmative 3,136,894,405.50 97.051
Withheld 95,301,930.76 2.949
TOTAL 3,232,196,336.26 100.000
ROBERT C. POZEN
Affirmative 3,137,057,584.79 97.057
Withheld 95,138,751.47 2.943
TOTAL 3,232,196,336.26 100.000
THOMAS R. WILLIAMS
Affirmative 3,128,882,711.68 96.804
Withheld 103,313,624.58 3.196
TOTAL 3,232,196,336.26 100.000
* DENOTES TRUST-WIDE PROPOSALS AND VOTING
RESULTS.
PROPOSAL 2
To ratify the selection of PricewaterhouseCoopers LLP as independent
accountants of the fund.
# OF % OF
VOTES CAST VOTES CAST
Affirmative 217,306,891.00 95.194
Against 4,571,863.04 2.002
Abstain 6,400,197.15 2.804
TOTAL 228,278,951.19 100.000
PROPOSAL 3
To adopt an Amended and Restated Declaration of Trust.*
# OF % OF
VOTES CAST VOTES CAST
Affirmative 2,887,949,756.03 90.562
Against 150,461,756.38 4.718
Abstain 150,503,417.13 4.720
TOTAL 3,188,914,929.54 100.000
Broker Non-Votes 43,281,406.72
PROPOSAL 5
To approve an amended management contract, including a management fee
structure change for the fund and allow future modifications of the
contract without a shareholder vote if permitted by the 1940 Act.
# OF % OF
VOTES CAST VOTES CAST
Affirmative 193,956,345.06 85.729
Against 17,093,218.88 7.556
Abstain 15,192,995.69 6.715
TOTAL 226,242,559.63 100.000
Broker Non-Votes 2,036,391.56
PROPOSAL 10
To eliminate the fundamental 80% investment policy and adopt a
comparable non-fundamental policy.
# OF % OF
VOTES CAST VOTES CAST
Affirmative 194,057,220.54 85.774
Against 17,799,298.47 7.867
Abstain 14,386,040.62 6.359
TOTAL 226,242,559.63 100.000
Broker Non-Votes 2,036,391.56
* DENOTES TRUST-WIDE PROPOSALS AND VOTING
RESULTS.
MANAGING YOUR INVESTMENTS
Fidelity offers several ways to conveniently manage your personal
investments via your telephone or PC. You can access your account
information, conduct trades and research your investments 24 hours a
day.
BY PHONE
Fidelity Automated Service Telephone provides a single toll-free
number to access account balances, positions, quotes and trading. It's
easy to navigate the service, and on your first call, the system will
help you create a personal identification number (PIN) for security.
(PHONE_GRAPHIC)FIDELITY AUTOMATED
SERVICE TELEPHONE (FASTSM)
1-800-544-5555
PRESS
1 For mutual fund and brokerage trading.
2 For quotes.*
3 For account balances and holdings.
4 To review orders and mutual
fund activity.
5 To change your PIN.
*0 To speak to a Fidelity representative.
BY PC
Fidelity's Web site on the Internet provides a wide range of
information, including daily financial news, fund performance,
interactive planning tools and news about Fidelity products and
services.
(COMPUTER_GRAPHIC)FIDELITY'S WEB SITE
WWW.FIDELITY.COM
If you are not currently on the Internet, call EarthLink Sprint at
1-800-288-2967, and be sure to ask for registration number SMD004 to
receive a special Fidelity package that includes 30 days of free
Internet access. EarthLink is North America's #1 independent Internet
access provider.
(COMPUTER_GRAPHIC)
FIDELITY ON-LINE XPRESS+(registered trademark)
Fidelity On-line Xpress+ software for Windows combines comprehensive
portfolio management capabilities, securities trading and access to
research and analysis tools . . . all on your desktop. Call Fidelity
at 1-800-544-0240 or visit our Web site for more information on how to
manage your investments via your PC.
* WHEN YOU CALL THE QUOTES LINE, PLEASE REMEMBER THAT A FUND'S YIELD
AND RETURN WILL VARY AND,
EXCEPT FOR MONEY MARKET FUNDS, SHARE PRICE WILL ALSO VARY. THIS MEANS
THAT YOU MAY HAVE A
GAIN OR LOSS WHEN YOU SELL YOUR SHARES. THERE IS NO ASSURANCE THAT
MONEY MARKET FUNDS WILL BE
ABLE TO MAINTAIN A STABLE $1 SHARE PRICE; AN INVESTMENT IN A MONEY
MARKET FUND IS NOT INSURED
OR GUARANTEED BY THE U.S. GOVERNMENT. TOTAL RETURNS ARE HISTORICAL AND
INCLUDE CHANGES IN SHARE
PRICE, REINVESTMENT OF DIVIDENDS AND CAPITAL GAINS, AND THE EFFECTS OF
ANY SALES CHARGES.
INVESTMENT ADVISER
Fidelity Management & Research Company
Boston, MA
INVESTMENT SUB-ADVISER
Fidelity Investments
Money Management, Inc. (FIMM),
Merrimack, NH
OFFICERS
Edward C. Johnson 3d, President
Robert C. Pozen, Senior Vice President
Fred L. Henning Jr., Vice President
Boyce I. Greer, Vice President
Dwight D. Churchill, Vice President
Norman U. Lind, Vice President -
INCOME FUND
Scott A. Orr, Vice President -
MONEY MARKET FUNDS
Eric D. Roiter, Secretary
Matthew N. Karstetter, Deputy Treasurer
Richard A. Silver, Treasurer
Stanley N. Griffith, Assistant Vice President
John H. Costello, Assistant Treasurer
Thomas J. Simpson, Assistant Treasurer
BOARD OF TRUSTEES
Ralph F. Cox *
Phyllis Burke Davis *
Robert M. Gates *
Edward C. Johnson 3d
E. Bradley Jones *
Donald J. Kirk *
Peter S. Lynch
Marvin L. Mann *
William O. McCoy *
Gerald C. McDonough *
Robert C. Pozen
Thomas R. Williams *
* INDEPENDENT TRUSTEES
NJN-ANN-0100 88396
1.539150.102
ADVISORY BOARD
J. Gary Burkhead
Abigail P. Johnson
Ned C. Lautenbach
GENERAL DISTRIBUTOR
Fidelity Distributors Corporation
Boston, MA
TRANSFER AND SHAREHOLDER
SERVICING AGENTS
Citibank N.A.
New York NY
and
Fidelity Service Company, Inc.
Boston, MA
CUSTODIAN
Citibank N.A.
New York NY
THE FIDELITY TELEPHONE CONNECTION
MUTUAL FUND 24-HOUR SERVICE
Exchanges/Redemptions
and Account Assistance 1-800-544-6666
Product Information 1-800-544-6666
Retirement Accounts 1-800-544-4774 (8 a.m. - 9 p.m.)
TDD Service 1-800-544-0118
for the deaf and hearing impaired
(9 a.m. - 9 p.m. Eastern time)
Fidelity Automated Service
Telephone (FASTSM) 1-800-544-5555
AUTOMATED LINE FOR QUICKEST SERVICE
(2_FIDELITY_LOGOS)(registered trademark)
Corporate Headquarters
82 Devonshire St., Boston, MA 02109
www.fidelity.com
SPARTAN(REGISTERED TRADEMARK)
FLORIDA
MUNICIPAL
FUNDS
ANNUAL REPORT
NOVEMBER 30, 1999
(2_FIDELITY_LOGOS)(registered trademark)
CONTENTS
PRESIDENT'S MESSAGE 3 Ned Johnson on investing
strategies.
SPARTAN FLORIDA MUNICIPAL
INCOME FUND
PERFORMANCE 4 How the fund has done over
time.
FUND TALK 7 The manager's review of fund
performance, strategy and
outlook.
INVESTMENT CHANGES 10 A summary of major shifts in
the fund's investments over
the past six months.
INVESTMENTS 11 A complete list of the fund's
investments with their
market values.
FINANCIAL STATEMENTS 21 Statements of assets and
liabilities, operations, and
changes in net assets, as
well as financial highlights.
SPARTAN FLORIDA MUNICIPAL
MONEY MARKET FUND
PERFORMANCE 25 How the fund has done over
time.
FUND TALK 27 The manager's review of fund
performance, strategy and
outlook.
INVESTMENT CHANGES 29 A summary of major shifts in
the fund's investments over
the past six months and one
year.
INVESTMENTS 30 A complete list of the fund's
investments.
FINANCIAL STATEMENTS 36 Statements of assets and
liabilities, operations, and
changes in net assets, as
well as financial highlights.
NOTES 40 Notes to the financial
statements.
REPORT OF INDEPENDENT 44 The auditors' opinion.
ACCOUNTANTS
DISTRIBUTIONS 45
PROXY VOTING RESULTS 46
Standard & Poor's, S&P and S&P 500 are registered service marks of The
McGraw-Hill Companies, Inc. and have been licensed for use by Fidelity
Distributors Corporation.
Other third party marks appearing herein are the property of their
respective owners.
All other marks appearing herein are registered or unregistered
trademarks or service marks of FMR Corp. or an affiliated company.
This report is printed on recycled paper using soy-based inks.
THIS REPORT AND THE FINANCIAL STATEMENTS CONTAINED HEREIN ARE
SUBMITTED FOR THE GENERAL
INFORMATION OF THE SHAREHOLDERS OF THE FUNDS. THIS REPORT IS NOT
AUTHORIZED FOR DISTRIBUTION TO
PROSPECTIVE INVESTORS IN THE FUNDS UNLESS PRECEDED OR ACCOMPANIED BY
AN EFFECTIVE PROSPECTUS.
MUTUAL FUND SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED
BY, ANY DEPOSITORY INSTITUTION. SHARES ARE NOT INSURED BY THE FDIC,
FEDERAL RESERVE BOARD, OR ANY OTHER AGENCY, AND ARE SUBJECT TO
INVESTMENT RISKS, INCLUDING POSSIBLE LOSS OF PRINCIPAL AMOUNT
INVESTED.
NEITHER THE FUNDS NOR FIDELITY DISTRIBUTORS CORPORATION IS A BANK.
FOR MORE INFORMATION ON ANY FIDELITY FUND, INCLUDING CHARGES AND
EXPENSES, CALL 1-800-544-6666
FOR A FREE PROSPECTUS. READ IT CAREFULLY BEFORE YOU INVEST OR SEND
MONEY.
PRESIDENT'S MESSAGE
(PHOTO_OF_EDWARD_C_JOHNSON_3D)
DEAR SHAREHOLDER:
U.S. equity indexes once again dominated the financial headlines, led
by the NASDAQ's 15 record highs in 21 November sessions. Meanwhile,
the Standard & Poor's 500SM posted two record closings and the Dow
Jones Industrial Average crept above the 11,000 mark for the first
time since mid-September. However, another Federal Reserve Board
interest rate hike and continued inflation concerns drove down the
price of the benchmark 30-year Treasury.
While it's impossible to predict the future direction of the markets
with any degree of certainty, there are certain basic principles that
can help investors plan for their future needs.
The longer your investment time frame, the less likely it is that you
will be affected by short-term market volatility. A 10-year investment
horizon appropriate for saving for a college education, for example,
enables you to weather market cycles in a long-term fund, which may
have a higher risk potential, but also has a higher potential rate of
return.
An intermediate-length fund could make sense if your investment
horizon is two to four years, while a short-term bond fund could be
the right choice if you need your money in one or two years.
If your time horizon is less than a year, you might want to consider
moving some of your bond investment into a money market fund. These
funds seek income and a stable share price by investing in
high-quality, short-term investments. Of course, it's important to
remember that an investment in a money market fund is not insured or
guaranteed by the Federal Deposit Insurance Corporation or any other
government agency. Although money market funds seek to preserve the
value of your investment at $1.00 per share, it is possible to lose
money by investing in these types of funds.
Finally, no matter what your time horizon or portfolio diversity, it
makes good sense to follow a regular investment plan, investing a
certain amount of money in a fund at the same time each month or
quarter and periodically reviewing your overall portfolio. By doing
so, you won't get caught up in the excitement of a rapidly rising
market, nor will you buy all your shares at market highs. While this
strategy - known as dollar cost averaging - won't assure a profit or
protect you from a loss in a declining market, it should help you
lower the average cost of your purchases. Of course, you should
consider your financial ability to continue your purchases through
periods of low price levels before undertaking such a strategy.
If you have questions, please call us at 1-800-544-6666, or visit our
web site at www.fidelity.com. We are available 24 hours a day, seven
days a week to provide you the information you need to make the
investments that are right for you.
Best regards,
Edward C. Johnson 3d
SPARTAN FLORIDA MUNICIPAL INCOME FUND
PERFORMANCE: THE BOTTOM LINE
There are several ways to evaluate a fund's historical performance.
You can look at the total percentage change in value, the average
annual percentage change or the growth of a hypothetical $10,000
investment. Total return reflects the change in the value of an
investment, assuming reinvestment of the fund's dividend income and
capital gains (the profits earned upon the sale of securities that
have grown in value). You can also look at the fund's income, as
reflected in the fund's yield, to measure performance. If Fidelity had
not reimbursed certain fund expenses, the life of fund total returns
would have been lower.
CUMULATIVE TOTAL RETURNS
PERIODS ENDED NOVEMBER 30, PAST 1 YEAR PAST 5 YEARS LIFE OF FUND
1999
SPARTAN FL MUNICIPAL INCOME -1.65% 44.09% 66.89%
LB Florida Municipal Bond -1.22% 44.29% n/a
Florida Municipal Debt Funds -3.36% 38.40% n/a
Average
CUMULATIVE TOTAL RETURNS show the fund's performance over a set period
- - in this case, one year, five years or since the fund started on
March 16, 1992. For example, if you had invested $1,000 in a fund that
had a 5% return over the past year, the value of your investment would
be $1,050. You can compare the fund's returns to the performance of
the Lehman Brothers Florida Municipal Bond Index - a market
value-weighted index of Florida investment-grade municipal bonds with
maturities of one year or more. To measure how the fund's performance
stacked up against its peers, you can compare it to the Florida
municipal debt funds average, which reflects the performance of mutual
funds with similar objectives tracked by Lipper Inc. The past one year
average represents a peer group of 64 mutual funds. These benchmarks
include reinvested dividends and capital gains, if any, and exclude
the effect of sales charges.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED NOVEMBER 30, PAST 1 YEAR PAST 5 YEARS LIFE OF FUND
1999
SPARTAN FL MUNICIPAL INCOME -1.65% 7.58% 6.87%
LB Florida Municipal Bond -1.22% 7.61% n/a
Florida Municipal Debt Funds -3.36% 6.71% n/a
Average
AVERAGE ANNUAL TOTAL RETURNS take the fund's cumulative return and
show you what would have happened if the fund had performed at a
constant rate each year. (Note: Lipper calculates average annual total
returns by annualizing each fund's total return, then taking an
arithmetic average. This may produce a different figure than that
obtained by averaging the cumulative total returns and annualizing the
result.)
$10,000 OVER LIFE OF FUND
Spartan FL Muni Income LB Municipal Bond
00427 LB015
1992/03/31 10000.00 10000.00
1992/04/30 10172.61 10089.00
1992/05/31 10350.03 10207.75
1992/06/30 10575.20 10379.03
1992/07/31 11028.26 10690.20
1992/08/31 10779.40 10585.97
1992/09/30 10823.45 10655.20
1992/10/31 10580.52 10550.46
1992/11/30 10944.39 10739.42
1992/12/31 11095.24 10849.07
1993/01/31 11245.75 10975.24
1993/02/28 11812.46 11372.22
1993/03/31 11626.24 11252.01
1993/04/30 11765.70 11365.54
1993/05/31 11841.80 11429.42
1993/06/30 12066.54 11620.18
1993/07/31 12101.29 11635.40
1993/08/31 12393.62 11877.65
1993/09/30 12566.59 12012.93
1993/10/31 12600.06 12036.12
1993/11/30 12423.65 11930.08
1993/12/31 12745.45 12181.92
1994/01/31 12914.00 12321.04
1994/02/28 12524.91 12001.93
1994/03/31 11935.22 11513.21
1994/04/30 12024.45 11610.84
1994/05/31 12139.04 11711.51
1994/06/30 12056.43 11639.95
1994/07/31 12310.26 11853.31
1994/08/31 12320.58 11894.32
1994/09/30 12130.96 11719.71
1994/10/31 11814.13 11511.57
1994/11/30 11530.36 11303.44
1994/12/31 11886.42 11552.23
1995/01/31 12279.67 11882.39
1995/02/28 12704.70 12227.93
1995/03/31 12848.58 12368.43
1995/04/30 12858.11 12383.03
1995/05/31 13293.09 12778.17
1995/06/30 13130.49 12667.00
1995/07/31 13237.10 12787.08
1995/08/31 13405.68 12949.22
1995/09/30 13499.13 13031.19
1995/10/31 13706.26 13220.67
1995/11/30 13961.59 13440.00
1995/12/31 14100.58 13569.15
1996/01/31 14182.96 13671.60
1996/02/29 14061.09 13579.32
1996/03/31 13892.16 13405.77
1996/04/30 13847.66 13367.84
1996/05/31 13843.25 13362.49
1996/06/30 14002.86 13508.01
1996/07/31 14127.09 13630.93
1996/08/31 14122.39 13627.66
1996/09/30 14310.34 13818.45
1996/10/31 14461.71 13974.73
1996/11/30 14742.11 14230.47
1996/12/31 14658.38 14170.70
1997/01/31 14692.85 14197.48
1997/02/28 14827.51 14327.82
1997/03/31 14596.62 14136.83
1997/04/30 14723.54 14255.15
1997/05/31 14946.39 14469.55
1997/06/30 15099.85 14623.65
1997/07/31 15539.17 15028.73
1997/08/31 15369.96 14887.91
1997/09/30 15538.41 15064.63
1997/10/31 15627.27 15161.49
1997/11/30 15728.03 15250.64
1997/12/31 15941.23 15473.15
1998/01/31 16156.40 15632.83
1998/02/28 16143.45 15637.52
1998/03/31 16136.19 15651.28
1998/04/30 16043.28 15580.69
1998/05/31 16289.98 15827.34
1998/06/30 16323.37 15889.70
1998/07/31 16400.59 15929.58
1998/08/31 16649.55 16175.69
1998/09/30 16825.46 16377.24
1998/10/31 16816.46 16376.91
1998/11/30 16892.27 16434.40
1998/12/31 16941.91 16475.81
1999/01/31 17137.87 16671.71
1999/02/28 17033.65 16598.85
1999/03/31 17039.19 16621.93
1999/04/30 17071.64 16663.31
1999/05/31 16928.43 16566.83
1999/06/30 16648.50 16328.27
1999/07/31 16714.54 16387.71
1999/08/31 16614.69 16256.60
1999/09/30 16633.23 16263.27
1999/10/31 16458.17 16086.98
1999/11/30 16614.02 16258.14
IMATRL PRASUN SHR__CHT 19991130 19991213 143650 R00000000000095
$10,000 OVER LIFE OF FUND: Let's say hypothetically that $10,000 was
invested in Spartan Florida Municipal Income Fund on March 31, 1992,
shortly after the fund started. As the chart shows, by November 30,
1999, the value of the investment would have grown to $16,614 - a
66.14% increase on the initial investment. For comparison, look at how
the Lehman Brothers Municipal Bond Index - a market value-weighted
index of investment-grade municipal bonds with maturities of one year
or more - did over the same period. With dividends and capital gains,
if any, reinvested, the same $10,000 would have grown to $16,258 - a
62.58% increase.
(checkmark)UNDERSTANDING
PERFORMANCE
How a fund did yesterday is
no guarantee of how it will
do tomorrow. Bond prices,
for example, generally move
in the opposite direction of
interest rates. In turn, the share
price, return and yield of a
fund that invests in bonds will
vary. That means if you sell
your shares during a market
downturn, you might lose
money. But if you can ride
out the market's ups and
downs, you may have a gain.
TOTAL RETURN COMPONENTS
YEARS ENDED NOVEMBER 30,
1999 1998 1997 1996 1995
Dividend returns 4.39% 4.77% 5.00% 5.10% 6.31%
Capital returns -6.04% 2.63% 1.69% 0.49% 14.78%
Total returns -1.65% 7.40% 6.69% 5.59% 21.09%
TOTAL RETURN COMPONENTS include both dividend returns and capital
returns. A dividend return reflects the actual dividends paid by the
fund. A capital return reflects both the amount paid by the fund to
shareholders as capital gain distributions and changes in the fund's
share price. Both returns assume the dividends or capital gains, if
any, paid by the fund are reinvested.
DIVIDENDS AND YIELD
PERIODS ENDED NOVEMBER 30, PAST 1 MONTH PAST 6 MONTHS PAST 1 YEAR
1999
Dividends per share 4.25(cents) 25.92(cents) 51.54(cents)
Annualized dividend rate 4.74% 4.69% 4.57%
30-day annualized yield 4.68% - -
30-day annualized 7.31% - -
tax-equivalent yield
DIVIDENDS per share show the income paid by the fund for a set period
and do not reflect any tax reclassifications. If you annualize this
number, based on an average share price of $10.90 over the past one
month, $11.02 over the past six months and $11.28 over the past one
year, you can compare the fund's income over these three periods. The
30-day annualized YIELD is a standard formula for all funds based on
the yields of the bonds in the fund, averaged over the past 30 days.
This figure shows you the yield characteristics of the fund's
investments at the end of the period. It also helps you compare funds
from different companies on an equal basis. The tax-equivalent yield
shows what you would have to earn on a taxable investment to equal the
fund's tax-free yield if you're in the 36% 1999 federal income tax
bracket, but does not reflect the payment of the federal alternative
minimum tax, if applicable.
SPARTAN FLORIDA MUNICIPAL INCOME FUND
FUND TALK: THE MANAGER'S OVERVIEW
MARKET RECAP
Although November saw the Federal
Reserve Board levy its third 0.25%
interest rate hike of 1999, the
municipal bond market responded
with its best single-month
performance since January. This
improvement in investor sentiment -
perhaps anticipating that the Fed's
latest rate hike would be its last for
a while - was a key contributor to
the market's improved outlook.
However, for the 12-month period
ending November 30, 1999, munis
overall dwelled in negative territory,
as the Lehman Brothers Municipal
Bond Index - an index of
approximately 50,000
investment-grade, fixed-rate,
tax-exempt bonds - declined
1.07%. A big story throughout the
year was supply, or lack thereof.
Municipal issuance fell 16.9%
through the first three quarters of
1999 compared to the same period
in 1998. Unfortunately, demand
also was tepid as the strong U.S.
economy continued to sway
investors toward higher-yielding -
and higher-risk - alternatives. Late in
the period, though, as the Fed
sought to cool down the economy
and municipal yields became more
attractive, demand showed signs of
improving. In comparison to other
bonds, munis had mixed results.
Municipal performance soundly
trounced Treasuries, as the Lehman
Brothers Long-Term Government
Bond Index fell 7.52% during the
period. Meanwhile, the Lehman
Brothers Aggregate Bond Index - a
broad measure of the taxable
bond market - posted a
marginally negative return of
- -0.04%.
(photograph of Christine Thompson)
An interview with Christine Thompson, Portfolio Manager of Spartan
Florida Municipal Income Fund
Q. HOW DID THE FUND PERFORM, CHRISTINE?
A. Although it was a disappointing period for municipal bonds, the
fund performed better than the average fund of its type. For the
12-month period that ended November 30, 1999, the fund had a total
return of -1.65%. To get a sense of how the fund did relative to its
competitors, the Florida municipal debt funds average returned -3.36%
for the same 12-month period, according to Lipper Inc. Additionally,
the Lehman Brothers Florida Municipal Bond Index - which tracks the
types of securities in which the fund invests - returned -1.22%.
Q. WHAT HELPED THE FUND BEAT ITS PEERS?
A. The fund's outperformance of its peers was due in part to the way
in which duration - a measure of a fund's interest-rate sensitivity -
was managed. Rather than speculate on the short-term movements of
interest rates, I managed the fund's duration to be in line with the
municipal market as a whole, as reflected by the Lehman Brothers
Florida Municipal Bond Index. While interest-rate timing strategies
often are the main contributors to performance over the short term,
they are unlikely to be successful over longer periods of time and can
swamp other value-added strategies. In keeping with Fidelity's
investment approach, I pursue strategies that have proven to have a
higher probability of success than interest-rate timing. Other funds
in the peer group do actively manage duration, and those that had
increased their interest-rate sensitivity suffered when interest rates
rose.
Q. WHICH BOND MATURITIES DID YOU FAVOR?
A. Throughout much of the past year, I emphasized
intermediate-maturity bonds - those set to mature within five to 15
years - a strategy that ultimately worked in the fund's favor.
Initially, intermediates suffered due to reduced demand and increased
supply at the hands of relatively heavy selling from institutional
investors. In contrast, shorter- and longer-term bonds held up fairly
well thanks to more or less constant demand for them. Based on
Fidelity's quantitative research models, I felt that intermediates
continued to offer the most attractive value for their given
interest-rate sensitivity and their total return potential. The fund's
focus on this maturity range worked in its favor during the past
several months because institutional investors came back into the
market with purchases of intermediate securities.
Q. THE FUND ALSO HAD A RELATIVELY LARGE EXPOSURE TO "PREMIUM" BONDS.
WHAT ARE PREMIUMS AND WHAT MADE THEM ATTRACTIVE?
A. Premium coupon bonds pay interest rates above face - or par -
value. One appealing aspect of premiums was that they were somewhat
insulated from unfavorable tax treatment that negatively affected the
prices of lower coupon, or "discounts," as rates rose. Although the
fund owned less than many of its peers, the fund did own a few
long-maturity, discount bonds, which were disappointing during the
year. Overall, the fund's focus on premium coupon bonds proved to be a
successful strategy.
Q. WHERE ELSE DID YOU FIND OPPORTUNITIES DURING THE PERIOD?
A. Transportation bonds made up 19.2% of the fund's net assets at the
end of the period. The strength of Florida's tourism and trade sectors
have helped benefit the state's airports. A number of airports have
expansion plans, which are funded with borrowings through municipal
debt. That provided opportunities to initiate positions in bonds
issued by various airport authorities at attractive levels.
Q. WHAT'S YOUR OUTLOOK FOR THE MUNICIPAL MARKET?
A. At the end of the period, municipals were priced cheaply compared
to their Treasury counterparts. To the extent that investors realize
and act on that relative cheapness, municipals could gain ground on
Treasuries. Of course, the major determinant of the bond market's
performance will, as always, be the direction of interest rates. But
instead of spending time trying to forecast interest-rate movements,
I'll look for attractively priced bonds that I believe will
outperform, no matter where interest rates end up. From a credit
quality perspective, Florida is in pretty good shape, characterized by
robust economic growth. Although that growth may slow in the months to
come, I expect the state to outpace the nation as a whole.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO
MANAGER ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON
THE COVER AND DO NOT NECESSARILY REPRESENT THE VIEWS OF FIDELITY OR
ANY OTHER PERSON IN THE FIDELITY ORGANIZATION. ANY SUCH VIEWS ARE
SUBJECT TO CHANGE AT ANY TIME BASED UPON MARKET OR OTHER CONDITIONS
AND FIDELITY DISCLAIMS ANY RESPONSIBILITY TO UPDATE SUCH VIEWS. THESE
VIEWS MAY NOT BE RELIED ON AS INVESTMENT ADVICE AND, BECAUSE
INVESTMENT DECISIONS FOR A FIDELITY FUND ARE BASED ON NUMEROUS
FACTORS, MAY NOT BE RELIED ON AS AN INDICATION OF TRADING INTENT ON
BEHALF OF ANY FIDELITY FUND.
(checkmark)FUND FACTS
GOAL: high current income
exempt from federal income tax
and the Florida intangible tax
FUND NUMBER: 427
TRADING SYMBOL: FFLIX
START DATE: March 16, 1992
SIZE: as of November 30,
1999, more than $420
million
MANAGER: Christine Thompson,
since 1998; manager,
various Fidelity and Spartan
municipal income funds;
joined Fidelity in 1985
CHRISTINE THOMPSON ON
MUNICIPAL BOND DEMAND:
"The demand for municipals can
vary a great deal in response to the
behavior of various market
participants. Corporations,
individual investors and trust
accounts tend to favor short-term
securities, which are less
interest-rate sensitive and,
therefore, tend to be less volatile
than the overall municipal
market. Individual investors,
along with mutual funds and
insurance companies - which
invest the insurance premiums
they collect in bonds - are the
primary purchasers of
intermediate-maturity bonds.
Higher-yielding, longer-term
securities, which tend to be the most
volatile, generally are the domain
of long-maturity mutual funds,
hedge funds and other investors
known as `arbitrageurs,' who seek to
exploit small differences between
various fixed-income investments.
At different points in time, a given
municipal bond maturity range
may look cheap or expensive as
different categories of investors
embrace them or step aside. With
the help of Fidelity's research
team, I try to take advantage of the
anomalies that can occur by
investing in bond maturities that
look cheap due to weak demand
and selling those that have
performed well in response to
strong demand."
SPARTAN FLORIDA MUNICIPAL INCOME FUND
INVESTMENT CHANGES
TOP FIVE SECTORS AS OF
NOVEMBER 30, 1999
% OF FUND'S NET ASSETS % OF FUND'S NET ASSETS 6
MONTHS AGO
Transportation 19.2 21.8
Health Care 15.0 13.9
Electric Utilities 13.4 15.6
Special Tax 12.7 11.1
Water & Sewer 9.9 9.6
AVERAGE YEARS TO MATURITY AS
OF NOVEMBER 30, 1999
6 MONTHS AGO
Years 12.0 11.6
AVERAGE YEARS TO MATURITY IS BASED ON THE AVERAGE TIME REMAINING UNTIL
PRINCIPAL PAYMENTS ARE EXPECTED FROM EACH OF THE FUND'S BONDS,
WEIGHTED BY DOLLAR AMOUNT.
DURATION AS OF NOVEMBER 30,
1999
6 MONTHS AGO
Years 6.7 6.4
DURATION SHOWS HOW MUCH A BOND FUND'S PRICE FLUCTUATES WITH CHANGES IN
COMPARABLE INTEREST RATES. IF RATES RISE 1%, FOR EXAMPLE, A FUND WITH
A FIVE-YEAR DURATION IS LIKELY TO LOSE ABOUT 5% OF ITS VALUE. OTHER
FACTORS ALSO CAN INFLUENCE A BOND FUND'S PERFORMANCE AND SHARE PRICE.
ACCORDINGLY, A BOND FUND'S ACTUAL PERFORMANCE MAY DIFFER FROM THIS
EXAMPLE.
QUALITY DIVERSIFICATION
(MOODY'S RATINGS)
AS OF NOVEMBER 30, 1999
Aaa 65.5%
Aa, A 18.5%
Baa 9.8%
Not Rated 3.7%
Short-term
investments 2.5%
Row: 1, Col: 1, Value: 65.5
Row: 1, Col: 2, Value: 18.5
Row: 1, Col: 3, Value: 9.800000000000001
Row: 1, Col: 4, Value: 3.7
Row: 1, Col: 5, Value: 2.5
Row: 1, Col: 6, Value: 0.0
AS OF MAY 31, 1999
Aaa 64.1%
Aa, A 18.6%
Baa 9.8%
Not Rated 3.6%
Short-term
investments 3.9%
Row: 1, Col: 1, Value: 64.09999999999999
Row: 1, Col: 2, Value: 18.6
Row: 1, Col: 3, Value: 9.800000000000001
Row: 1, Col: 4, Value: 3.6
Row: 1, Col: 5, Value: 3.9
Row: 1, Col: 6, Value: 0.0
WHERE MOODY'S RATINGS ARE NOT AVAILABLE, WE HAVE USED S&P (registered
trademark) RATINGS. AMOUNTS SHOWN ARE AS A PERCENTAGE OF THE FUND'S
INVESTMENTS.
PRIOR TO THIS REPORT, CERTAIN INFORMATION RELATED TO PORTFOLIO
HOLDINGS WAS STATED AS A PERCENTAGE OF THE FUND'S INVESTMENTS.
SPARTAN FLORIDA MUNICIPAL INCOME FUND
INVESTMENTS NOVEMBER 30, 1999
Showing Percentage of Net Assets
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
MUNICIPAL BONDS - 98.3%
MOODY'S RATINGS (UNAUDITED) (F) PRINCIPAL AMOUNT VALUE (NOTE 1)
FLORIDA - 98.3%
Alachua County Health
Facilities Auth. Health
Facilities Rev. Rfdg.
(Avmed/Santa Fe Health Sys.
Proj.):
6% 11/15/09 (Escrowed to Baa1 $ 2,595,000 $ 2,691,612
Maturity) (c)
6.05% 11/15/16 (Escrowed to Baa1 6,230,000 6,413,411
Maturity) (c)
Broward County Arpt. Sys.
Rev. Series H1:
4.5% 10/1/03 (AMBAC Insured) Aaa 3,425,000 3,406,985
(b)
4.5% 10/1/04 (AMBAC Insured) Aaa 3,280,000 3,251,858
(b)
Broward County Hsg. Fin. Aaa 1,225,000 1,251,877
Auth. Single Family Mtg.
Rev. (GNMA Collateralized)
6.65% 8/1/21 (b)
Broward County Resource A3 10,240,000 10,572,794
Recovery Rev. (SES Broward
Co. LP South Proj.) 7.95%
12/1/08
Broward County Spl. Oblig. Aaa 1,000,000 1,022,570
Rfdg. 5.5% 1/1/02 (AMBAC
Insured)
Dade County Aviation Rev.:
Rfdg.:
(Miami Int'l. Arpt. Proj.) Aaa 1,800,000 1,865,376
Series A: 5.75% 10/1/03 (FSA
Insured) (b)
6% 10/1/08 (FSA Insured) (b) Aaa 4,175,000 4,415,605
Series B, 6.3% 10/1/05 (AMBAC Aaa 1,200,000 1,294,020
Insured)
Series C, 5.5% 10/1/11 (MBIA Aaa 5,200,000 5,291,364
Insured)
Series D, 5.75% 10/1/09 Aaa 2,125,000 2,196,549
(AMBAC Insured) (b)
Series Y, 5.3% 10/1/05 Aa3 3,460,000 3,561,966
(Miami Int'l. Arpt. Proj.) Aaa 3,300,000 3,175,755
Series B, 5% 10/1/11 (FSA
Insured) (b)
Dade County Gen. Oblig. Aaa 1,820,000 2,144,269
Series DD, 7.7% 10/1/07
(AMBAC Insured)
Dade County Guaranteed
Entitlement Rev.:
(Cap. Appreciation) 0% 8/1/18 Aaa 14,835,000 4,420,682
(AMBAC Insured)
(Pre-Refunded to 2/1/06 @
40.446) (c)
Rfdg. (Cap. Appreciation) Aaa 1,810,000 1,642,304
Series B, 0% 2/1/02 (MBIA
Insured)
Dade County Resource Recovery Aaa 5,000,000 5,087,850
Facilities Rev. Rfdg. 5.5%
10/1/09 (AMBAC Insured) (b)
Dade County School Board Aaa 1,000,000 1,047,260
Ctfs. of Prtn. Series A,
5.5% 5/1/25 (AMBAC Insured)
(Pre-Refunded to 5/1/06 @
101) (c)
Dade County Seaport Rev. Rfdg.:
Series 1995, 5.75% 10/1/15 Aaa 5,100,000 5,141,106
(MBIA Insured)
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (F) PRINCIPAL AMOUNT VALUE (NOTE 1)
FLORIDA - CONTINUED
Dade County Seaport Rev.
Rfdg.: - continued
Series 1995, 6.2% 10/1/09 Aaa $ 1,845,000 $ 2,003,836
(MBIA Insured)
Dade County Spl. Oblig.:
Rfdg. (Cap. Appreciation)
Series B:
0% 10/1/03 (AMBAC Insured) Aaa 4,160,000 3,484,915
0% 10/1/04 (AMBAC Insured) Aaa 5,045,000 4,008,656
0% 10/1/16 (Pre-Refunded to Aaa 4,300,000 1,720,903
10/1/08 @ 63.0732)(AMBAC
Insured)(c)
Dade County Wtr. & Swr. Sys.
Rev.:
5.25% 10/1/21 (FGIC Insured) Aaa 2,970,000 2,737,627
6.25% 10/1/10 (FGIC Insured) Aaa 1,000,000 1,093,440
Dunedin Hosp. Rev. Rfdg. Aaa 1,400,000 1,429,036
(Mease Health Care Proj.)
5.25% 11/15/06 (MBIA Insured)
Dunedin Util. Sys. Rev. Rfdg. Aaa 1,360,000 1,486,942
6.25% 10/1/11 (FGIC Insured)
Duval County Hsg. Fin. Auth. Aaa 390,000 404,910
Single Family Mtg. Rev.
Series C, 7.7% 9/1/24 (FGIC
Insured)
Duval County School District Aaa 5,000,000 5,264,000
Rfdg. 6.3% 8/1/06 (AMBAC
Insured)
Escambia County Health
Facilities Auth. Health
Facilities Rev. Rfdg.:
(Baptist Hosp. & Baptist
Manor Proj.):
6.75% 10/1/14 BBB+ 570,000 603,698
6.75% 10/1/14 (Pre-Refunded BBB+ 2,555,000 2,770,744
to 10/1/03 @ 102) (c)
(Baptist Hosp., Inc. Proj.) BBB+ 2,825,000 2,748,217
Series B, 6% 10/1/14
Escambia County Sales Tax Aaa 2,000,000 2,057,940
Rev. Rfdg. 5.55% 1/1/07
(FGIC Insured)
Escambia County Utils. Aaa 1,500,000 1,601,175
Auth.Util. Sys. Rev. Series
B, 6.25% 1/1/15 (FGIC
Insured)
Florida Board of Ed. Cap.
Outlay:
(Pub. Ed. Proj.):
Series 1994 C, 5.4% 6/1/06 Aa2 1,500,000 1,550,370
Series B, 5.625% 6/1/08 Aa2 2,000,000 2,070,580
Series E, 5.25% 6/1/23 Aa2 1,750,000 1,612,538
Series F, 5.5% 6/1/17 Aa2 3,000,000 2,920,650
Rfdg. (Pub. Ed. Proj.) Series Aa2 2,100,000 2,035,530
D, 5.75% 6/1/22 (e)
Series B, 5% 6/1/13 Aa2 2,975,000 2,836,335
Series C, 5.75% 6/1/29 (FGIC Aaa 2,000,000 1,961,280
Insured)
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (F) PRINCIPAL AMOUNT VALUE (NOTE 1)
FLORIDA - CONTINUED
Florida Dept. of Trans. Aa2 $ 3,810,000 $ 3,928,605
(Right of Way Trans. Proj.)
Series B, 5.5% 7/1/09
Florida Div. Board Fin. Dept.
Gen. Svcs. Revs.:
(Dept. of Envir. Protection
Preservation 2000 Proj.)
Series A:
5.25% 7/1/10 (MBIA Insured) Aaa 5,000,000 5,040,200
5.7% 7/1/09 (AMBAC Insured) Aaa 3,000,000 3,088,860
5.75% 7/1/08 (AMBAC Insured) Aaa 2,700,000 2,844,072
5.75% 7/1/11 (AMBAC Insured) Aaa 3,000,000 3,105,630
Rfdg. (Dept. of Envir.
Protection Preservation
2000 Proj.):
Series A, 5.5% 7/1/09 (FSA Aaa 2,100,000 2,166,738
Insured)
Series B, 5.75% 7/1/07 (AMBAC Aaa 1,000,000 1,053,910
Insured)
Florida Hsg. Fin. Agcy.
Multi-family Hsg. Rev. Rfdg.
(Single Family Mtg. Proj.):
Series A:
6.35% 7/1/14 Aaa 1,070,000 1,093,786
6.55% 7/1/14 (b) Aaa 1,405,000 1,447,066
Series B, 6.55% 7/1/17 (b) Aaa 1,070,000 1,095,937
Florida Mid-Bay Bridge Auth.
Rev. Series A:
6.875% 10/1/22 (Escrowed to - 3,000,000 3,397,080
Maturity) (c)
7.5% 10/1/17 - 1,700,000 1,827,568
Florida Muni. Pwr. Agcy. Rev.
Rfdg. (Stanton II Proj.):
4.5% 10/1/16 (AMBAC Insured) Aaa 4,400,000 3,763,584
4.5% 10/1/27 (AMBAC Insured) Aaa 7,000,000 5,554,640
Florida Tpk. Auth. Tpk. Rev.:
(Dept. of Trans. Proj.) Aaa 1,500,000 1,498,050
Series A, 5.5% 7/1/14 (FGIC
Insured)
Rfdg. Series A, 5.25% 7/1/09 Aaa 6,740,000 6,833,551
(FGIC Insured)
Gainesville Utils. Sys. Rev.:
Rfdg.:
Series A, 5.2% 10/1/22 Aa3 3,000,000 2,744,970
Series B, 5.5% 10/1/13 Aa3 1,500,000 1,509,135
Series B, 6.5% 10/1/10 Aa3 1,600,000 1,786,704
Greater Orlando Aviation
Auth. Orlando Arpt.
Facilities Rev.:
Series A, 6.5% 10/1/05 (FGIC Aaa 3,550,000 3,767,651
Insured) (b)
5.25% 10/1/23 (FGIC Insured) Aaa 3,000,000 2,719,710
(b)
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (F) PRINCIPAL AMOUNT VALUE (NOTE 1)
FLORIDA - CONTINUED
Hillsborough County Aviation Aaa $ 6,130,000 $ 6,193,568
Auth. Rev. Rfdg. (Tampa
Intl. Arpt. Proj.) Series A,
5% 10/1/01 (AMBAC Insured)
(b)
Hillsborough County Cap. Aaa 1,000,000 1,068,160
Impt. Prog. Rev. Rfdg. 6%
8/1/06 (FGIC Insured)
Hillsborough County Gen. Aaa 2,080,000 2,162,763
Oblig. Rfdg. (Envir.
Sensitive Lands Acquisition
& Protection Proj.) 6%
7/1/02 (AMBAC Insured)
Hillsborough County Ind. Dev. Baa1 5,000,000 4,475,300
Auth. Ind. Dev. Rev. (Univ.
Cmnty. Hosp. Proj.) 5.625%
8/15/19
Hillsborough County Port
District Spl. Refing. Rev.
Rfdg. (Tampa Port Auth.
Proj.):
6.5% 6/1/03 (FSA Insured) (b) Aaa 2,000,000 2,118,060
6.5% 6/1/05 (FSA Insured) (b) Aaa 2,000,000 2,158,000
Hillsborough County School Aaa 4,370,000 4,381,755
Board Ctfs. of Ptrn. Rfdg.
(Master Lease Prog. Proj.)
Series A, 5.5% 7/1/14 (MBIA
Insured)
Hillsborough County Util.
Rev. Rfdg. (Cap.
Appreciation) Series A:
0% 8/1/05 (MBIA Insured) Aaa 6,500,000 4,952,935
0% 8/1/06 (MBIA Insured) Aaa 5,000,000 3,608,500
0% 8/1/07 (MBIA Insured) Aaa 7,000,000 4,775,470
Indian River County Wtr. & Aaa 2,000,000 2,049,560
Swr. Rev. Rfdg. Series A,
5.5% 9/1/11 (FGIC Insured)
Jacksonville Elec. Auth. Rev.:
(Second Installment Proj.) Aaa 1,355,000 1,354,743
5.25% 7/1/01 (Escrowed to
Maturity) (c)
Rfdg. (Saint John River Proj.):
Series 10 Issue 2, 6.5% Aa2 1,500,000 1,605,375
10/1/03
Series 16 Issue 2, 5.375% Aa2 4,000,000 3,997,200
10/1/13
Jacksonville Excise Tax Rev.:
Rfdg. 6.25% 10/1/05 (AMBAC Aaa 1,000,000 1,057,510
Insured)
Rfdg. & Impt. Series B:
5.5% 10/1/10 (FGIC Insured) Aaa 2,540,000 2,588,565
(b)
5.5% 10/1/11 (FGIC Insured) Aaa 2,730,000 2,764,180
(b)
Series B, 5.6% 10/1/08 (FGIC Aaa 2,300,000 2,353,567
Insured) (b)
Jacksonville Health
Facilities Auth. Hosp. Rev.
(Charity Obligated Group
Proj.) Series A:
5.25% 8/15/08 (MBIA Insured) Aaa 3,720,000 3,777,400
5.5% 8/15/05 (MBIA Insured) Aaa 1,600,000 1,659,616
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (F) PRINCIPAL AMOUNT VALUE (NOTE 1)
FLORIDA - CONTINUED
Jacksonville Health
Facilities Auth. Ind. Dev.
Rev.:
(Cypress Village Proj./Nat'l. Baa2 $ 2,740,000 $ 2,994,683
Benevolent Assoc. Proj.) 8%
12/1/24
Rfdg. (Cypress Village
Proj./Nat'l. Benevolent
Assoc. Proj.):
6.25% 12/1/23 Baa2 2,710,000 2,583,741
7% 12/1/14 Baa1 1,000,000 1,052,790
7% 12/1/22 Baa1 2,000,000 2,097,120
Jacksonville Ind. Dev. Rev. - 1,250,000 1,294,675
Rfdg. (Cargill, Inc. Proj.)
6.4% 3/1/11 (g)
Jacksonville Port Auth. Arpt. Aaa 2,550,000 2,569,712
Rev. Rfdg. 5% 10/1/05 (FGIC
Insured) (b)
Jacksonville Sales Tax Rev. Aaa 1,900,000 1,915,656
(River City Rennaissance
Proj.) 5.65% 10/1/14 (FGIC
Insured)
Lakeland Elec. & Wtr. Rev.:
(Cap. Appreciation) 0% Aaa 2,840,000 1,703,318
10/1/09 (FGIC Insured)
(Escrowed to Maturity) (c)
6.3% 10/1/02 (FSA Insured) Aaa 5,180,000 5,442,833
6.55% 10/1/07 (FSA Insured) Aaa 1,095,000 1,212,088
Lee County Ind. Dev. Auth.
Health Care Facilities Rev.
Rfdg. (Shell Point Village
Proj.) Series A:
5.25% 11/15/07 BBB- 1,250,000 1,191,275
5.5% 11/15/09 BBB- 800,000 764,856
5.5% 11/15/29 BBB- 6,250,000 5,125,500
Leesburg Hosp. Rev. Rfdg.
(Leesburg Reg'l. Med. Ctr.
Proj.):
Series A, 5.6% 7/1/08 A3 5,000,000 4,966,650
Series B, 5.625% 7/1/13 A3 2,795,000 2,674,927
Leon County Cap. Impt. Rev.
Rfdg. Series B:
5.25% 10/1/08 (AMBAC Insured) Aaa 2,115,000 2,148,057
5.25% 10/1/09 (AMBAC Insured) Aaa 2,225,000 2,259,643
5.25% 10/1/11 (AMBAC Insured) Aaa 2,465,000 2,476,857
Leon County Gen. Oblig. Rev. Aaa 1,000,000 1,039,940
Rfdg. 5.5% 10/1/07 (MBIA
Insured)
Melbourne Arpt. Rev. Rfdg.:
6.25% 10/1/00 (MBIA Insured) Aaa 230,000 234,119
(b)
6.25% 10/1/01 (MBIA Insured) Aaa 240,000 247,910
(b)
6.25% 10/1/02 (MBIA Insured) Aaa 260,000 272,147
(b)
6.25% 10/1/03 (MBIA Insured) Aaa 270,000 284,969
(b)
6.5% 10/1/04 (MBIA Insured) Aaa 290,000 311,669
(b)
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (F) PRINCIPAL AMOUNT VALUE (NOTE 1)
FLORIDA - CONTINUED
Melbourne Arpt. Rev. Rfdg.: -
continued
6.5% 10/1/05 (MBIA Insured) Aaa $ 310,000 $ 336,595
(b)
6.5% 10/1/06 (MBIA Insured) Aaa 325,000 354,039
(b)
6.75% 10/1/07 (MBIA Insured) Aaa 350,000 388,329
(b)
6.75% 10/1/08 (MBIA Insured) Aaa 375,000 419,171
(b)
6.75% 10/1/09 (MBIA Insured) Aaa 400,000 447,028
(b)
6.75% 10/1/10 (MBIA Insured) Aaa 425,000 476,574
(b)
Miami Beach Health Facilities BBB 4,400,000 3,535,180
Auth. Hosp. Rev. (Mount
Sinai Med. Ctr. of Florida
Proj.) 5.375% 11/15/28
Miami Dade County Aviation
Rev.:
Rfdg. Series A, 5% 10/1/05 Aaa 2,550,000 2,563,286
(FGIC Insured) (b)
Series C, 5.25% 10/1/12 (MBIA Aaa 5,185,000 5,064,604
Insured) (b)
Miami-Dade County Edl. Aaa 6,020,000 5,886,657
Facilities Auth. Rev. Series
A, 5.75% 4/1/29 (AMBAC
Insured)
Naples Hosp. Rev. Rfdg. Aaa 1,500,000 1,511,550
(Naples Cmnty. Hosp., Inc.
Proj.) 5.1% 10/1/07 (MBIA
Insured)
North Miami Edl. Facilities - 6,605,000 6,516,691
Rev. (Johnson & Wales Univ.
Proj.) Series A, 6.125%
4/1/20
Orange County Health
Facilities Auth. Rev.:
(Orlando Reg'l. Health Care Aaa 2,500,000 2,648,175
Proj.) Series A, 6.25%
10/1/18 (MBIA Insured)
Rfdg.:
(Adventist Health Sys. Proj.) Aaa 2,000,000 2,103,220
5.75% 11/15/05 (AMBAC
Insured)
(Orlando Reg'l Health Care Aaa 4,200,000 4,385,220
Sys. Proj.) Series 1999 D,
5.75% 10/1/11 (MBIA Insured)
Orange County Hsg. Fin. Auth. AAA 1,320,000 1,352,221
Single Family Mtg. Rev.
(Mtg. Backed Securities
Prog.) 6.4% 10/1/14 (b)
Orange County Tourist Dev. Aaa 1,795,000 1,905,698
Tax Rev. Rfdg. Series A,
5.85% 10/1/08 (MBIA Insured)
Orlando & Orange County Aaa 2,200,000 2,215,642
Expressway Auth. Rev. 5.097%
7/1/04 (FGIC Insured)
Orlando Util. Commission Wtr.
& Elec. Rev.:
Rfdg.:
Sub-Series A, 5% 10/1/20 Aa2 5,745,000 5,134,709
Sub-Series D, 6.75% 10/1/17 Aa2 7,250,000 8,066,423
6% 10/1/10 Aa1 2,505,000 2,693,952
5.538% 10/31/13 Aa2 9,400,000 9,416,638
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (F) PRINCIPAL AMOUNT VALUE (NOTE 1)
FLORIDA - CONTINUED
Palm Beach County Health A- $ 2,930,000 $ 2,704,302
Facilities Auth. Rev.
(Retirement Cmnty.-Adult
Communities Total Svc., Inc.
Proj.) 5.625% 11/15/20
Pasco County Solid Waste
Disp. & Resource Recovery
Sys. Rev. Rfdg.:
5.75% 4/1/04 (AMBAC Insured) Aaa 3,380,000 3,510,367
(b)
6% 4/1/08 (AMBAC Insured) (b) Aaa 2,400,000 2,540,208
6% 4/1/10 (AMBAC Insured) (b) Aaa 5,770,000 6,103,910
6% 4/1/11 (AMBAC Insured) (b) Aaa 5,000,000 5,284,200
Pensacola Arpt. Rev. Rfdg. Aaa 1,500,000 1,552,650
Series A, 6.125% 10/1/18
(MBIA Insured) (b)
Plantation Health Facilities - 2,500,000 2,775,725
Auth. Rev. (Covenant
Retirement Communities, Inc.
Proj.) 7.75% 12/1/22
(Pre-Refunded to 12/1/02 @
102) (c)
Polk County Ind. Dev. Auth. Aaa 1,425,000 1,502,435
Ind. Dev. Rev. (Winter Haven
Hosp. Proj.) Series 2, 6.25%
9/1/15 (MBIA Insured)
Port of Saint Lucie Util.
Rev. Rfdg. & Impt. Series A:
5% 9/1/17 (MBIA Insured) Aaa 8,000,000 7,269,360
5.125% 9/1/27 (MBIA Insured) Aaa 4,750,000 4,243,983
Sarasota County Util. Sys. Aaa 1,830,000 1,950,506
Rev. Rfdg. Series A, 6%
10/1/05 (FGIC Insured)
South Miami Health Facilities Aaa 1,980,000 2,050,171
Auth. Hosp. Rev. Rfdg.
(Baptist Health Sys. Oblig.
Group Proj.) 5.5% 10/1/05
(MBIA Insured)
Sumter County School District Aaa 1,000,000 1,175,670
Rev. (Multi-District Ln.
Prog. Proj.) 7.15% 11/1/15
(FSA Insured)
Sunrise Util. Sys. Rev. (Cap.
Appreciation) Series A:
0% 10/1/00 (AMBAC Insured) Aaa 1,070,000 1,035,321
0% 10/1/01 (AMBAC Insured) Aaa 1,225,000 1,131,729
0% 10/1/02 (AMBAC Insured) Aaa 1,000,000 881,760
Sunshine State Govt. Fing. Aaa 1,000,000 1,040,600
Commission Rev. Series A,
5.5% 10/1/05 (FGIC Insured)
Tampa Bay Wtr. Util. Sys. Aaa 2,000,000 2,038,060
Rev. 6% 10/1/24 (FGIC
Insured)
Tampa Gen. Oblig.:
(Allegany Health Sys. - Saint
Joseph Proj.):
6.7% 12/1/07 (MBIA Insured) Aaa 2,535,000 2,701,195
(Pre-Refunded to 12/1/01 @
102) (c)
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (F) PRINCIPAL AMOUNT VALUE (NOTE 1)
FLORIDA - CONTINUED
Tampa Gen. Oblig.: - continued
(Allegany Health Sys. - Saint Aaa $ 150,000 $ 159,977
Joseph Proj.) 6.75% 12/1/17
(MBIA Insured) (Pre-Refunded
to 12/1/01 @ 102) (c)
(Catholic Health East Proj.)
Series A1:
4.7% 11/15/10 (MBIA Insured) Aaa 1,500,000 1,436,070
5% 11/15/09 (MBIA Insured) Aaa 1,000,000 992,530
5.5% 11/15/08 (MBIA Insured) Aaa 1,000,000 1,037,370
5.5% 11/15/14 (MBIA Insured) Aaa 1,000,000 999,730
Tampa Sports Auth. (Stadium Aaa 2,235,000 2,362,015
Proj.) 6% 1/1/05 (MBIA
Insured)
Volusia County Edl. Baa2 2,500,000 2,504,275
Facilities Auth. Rev. (Embry
Riddle Aeronaut Univ. Proj.)
Series A, 6.125% 10/15/16
TOTAL MUNICIPAL BONDS 412,939,065
(Cost $413,779,324)
</TABLE>
MUNICIPAL NOTES - 2.5%
FLORIDA - 2.5%
Collier County Health 1,300,000 1,300,000
Facilities Auth. Hosp. Rev.
(Cleveland Clinic Health
Sys.) Series 1999, 3.7%
(Liquidity Facility Bank One
NA, Michigan), VRDN (a)
Manatee County Poll. Cont. 1,500,000 1,500,000
Rev. Rfdg. (Florida Pwr. &
Lt. Co. Proj.) Series 1994,
3.7%, VRDN (a)
Saint Lucie County Poll. 1,900,000 1,900,000
Cont. Rev. Rfdg. (Florida
Pwr. & Lt. Co. Proj.) 3.7%,
VRDN (a)
Tampa Sports Auth. 5,700,000 5,700,000
Participating VRDN Series
SGA 61, 3.8% (Liquidity
Facility Societe Generale,
France) (a)(d)
TOTAL MUNICIPAL NOTES 10,400,000
(Cost $10,400,000)
TOTAL INVESTMENT PORTFOLIO - 423,339,065
100.8%
(Cost $424,179,324)
NET OTHER ASSETS - (0.8)% (3,302,212)
NET ASSETS - 100% $ 420,036,853
SECURITY TYPE ABBREVIATION
VRDN - VARIABLE RATE DEMAND NOTE
LEGEND
(a) The coupon rate shown on floating or adjustable rate securities
represents the rate at period end.
(b) Private activity obligations whose interest is subject to the
federal alternative minimum tax for individuals.
(c) Security collateralized by an amount sufficient to pay interest
and principal.
(d) Provides evidence of ownership in one or more underlying municipal
bonds.
(e) Security purchased on a delayed delivery or when-issued basis.
(f) Standard & Poor's credit ratings are used in the absence of a
rating by Moody's Investors Service, Inc.
(g) Restricted securities - Investment in securities not registered
under the Securities Act of 1933.
Additional information on each holding is as follows:
SECURITY ACQUISITION DATE ACQUISITION COST
Jacksonville Ind. Dev. Rev. 7/9/92 $ 1,250,000
Rfdg. (Cargill, Inc. Proj.)
6.4% 3/1/11
OTHER INFORMATION
The composition of long-term debt holdings as a percentage of total
value of investments in securities, is as follows (ratings are
unaudited):
MOODY'S RATINGS S&P RATINGS
Aaa, Aa, A 83.0% AAA, AA, A 85.8%
Baa 5.9% BBB 5.0%
Ba 0.0% BB 0.0%
B 0.0% B 0.0%
Caa 0.0% CCC 0.0%
Ca, C 0.0% CC, C 0.0%
CC, C 0.0%
The percentage not rated by Moody's or S&P amounted to 3.8%.
The fund invested in securities that are not registered under the
Securities Act of 1933. These securities are subject to legal or
contractual restrictions on resale. At the end of the period,
restricted securities (excluding Rule 144A issues) amounted to
$1,294,675 and 0.3% of net assets.
The distribution of municipal securities by revenue source, as a
percentage of net assets, is as follows:
Transportation 19.2%
Health Care 15.0
Electric Utilities 13.4
Special Tax 12.7
Water & Sewer 9.9
General Obligations 8.0
Resource Recovery 7.9
Escrowed/Pre-Refunded 7.8
Others* (individually less 6.1
than 5%)
100.0%
* Includes short-term investments and net other assets.
INCOME TAX INFORMATION
At November 30, 1999, the aggregate cost of investment securities for
income tax purposes was $424,186,982. Net unrealized depreciation
aggregated $847,917, of which $7,602,444 related to appreciated
investment securities and $8,450,361 related to depreciated investment
securities.
The fund hereby designates approximately $3,002,000 as a capital gain
dividend for the purpose of the dividend paid deduction.
SPARTAN FLORIDA MUNICIPAL INCOME FUND
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
NOVEMBER 30, 1999
ASSETS
Investment in securities, at $ 423,339,065
value (cost $424,179,324) -
See accompanying schedule
Cash 462,902
Receivable for fund shares 212,609
sold
Interest receivable 5,256,454
TOTAL ASSETS 429,271,030
LIABILITIES
Payable for investments $ 5,986,709
purchased Regular delivery
Delayed delivery 2,043,342
Payable for fund shares 341,543
redeemed
Distributions payable 672,319
Accrued management fee 188,532
Other payables and accrued 1,732
expenses
TOTAL LIABILITIES 9,234,177
NET ASSETS $ 420,036,853
Net Assets consist of:
Paid in capital $ 419,932,135
Accumulated undistributed net 944,977
realized gain (loss) on
investments
Net unrealized appreciation (840,259)
(depreciation) on investments
NET ASSETS, for 38,609,190 $ 420,036,853
shares outstanding
NET ASSET VALUE, offering $10.88
price and redemption price
per share ($420,036,853
(divided by) 38,609,190
shares)
STATEMENT OF OPERATIONS
YEAR ENDED NOVEMBER 30, 1999
INTEREST INCOME $ 22,337,043
EXPENSES
Management fee $ 2,406,698
Non-interested trustees' 1,322
compensation
Total expenses before 2,408,020
reductions
Expense reductions (23,082) 2,384,938
NET INTEREST INCOME 19,952,105
REALIZED AND UNREALIZED GAIN
(LOSS)
Net realized gain (loss) on:
Investment securities 1,336,571
Futures contracts (164,799) 1,171,772
Change in net unrealized
appreciation (depreciation)
on:
Investment securities (28,474,260)
Futures contracts 160,769 (28,313,491)
NET GAIN (LOSS) (27,141,719)
NET INCREASE (DECREASE) IN $ (7,189,614)
NET ASSETS RESULTING FROM
OPERATIONS
<TABLE>
<CAPTION>
<S> <C> <C>
STATEMENT OF CHANGES IN NET ASSETS
YEAR ENDED NOVEMBER 30, 1999 YEAR ENDED NOVEMBER 30, 1998
INCREASE (DECREASE) IN NET
ASSETS
Operations Net interest income $ 19,952,105 $ 19,649,096
Net realized gain (loss) 1,171,772 4,177,788
Change in net unrealized (28,313,491) 6,787,122
appreciation (depreciation)
NET INCREASE (DECREASE) IN (7,189,614) 30,614,006
NET ASSETS RESULTING FROM
OPERATIONS
Distributions to shareholders (19,952,105) (19,649,096)
From net interest income
From net realized gain (3,526,839) (1,809,138)
TOTAL DISTRIBUTIONS (23,478,944) (21,458,234)
Share transactions Net 105,073,856 72,078,855
proceeds from sales of shares
Reinvestment of distributions 13,834,718 13,227,479
Cost of shares redeemed (116,778,573) (54,386,216)
NET INCREASE (DECREASE) IN 2,130,001 30,920,118
NET ASSETS RESULTING FROM
SHARE TRANSACTIONS
Redemption fees 93,203 15,554
TOTAL INCREASE (DECREASE) (28,445,354) 40,091,444
IN NET ASSETS
NET ASSETS
Beginning of period 448,482,207 408,390,763
End of period $ 420,036,853 $ 448,482,207
OTHER INFORMATION
Shares
Sold 9,296,220 6,244,717
Issued in reinvestment of 1,224,448 1,145,917
distributions
Redeemed (10,353,481) (4,716,574)
Net increase (decrease) 167,187 2,674,060
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
FINANCIAL HIGHLIGHTS
YEARS ENDED NOVEMBER 30, 1999 1998 1997 1996 1995
SELECTED PER-SHARE DATA
Net asset value, beginning $ 11.670 $ 11.420 $ 11.230 $ 11.180 $ 9.740
of period
Income from Investment .515 .526 .539 .546 .573
Operations Net interest
income
Net realized and unrealized (.702) .300 .190 .054 1.439
gain (loss)
Total from investment (.187) .826 .729 .600 2.012
operations
Less Distributions
From net interest income (.515) (.526) (.539) (.546) (.573)
From net realized gain (.090) (.050) - (.005) -
Total distributions (.605) (.576) (.539) (.551) (.573)
Redemption fees added to .002 .000 .000 .001 .001
paid in capital
Net asset value, end of period $ 10.880 $ 11.670 $ 11.420 $ 11.230 $ 11.180
TOTAL RETURN A (1.65)% 7.40% 6.69% 5.59% 21.09%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 420,037 $ 448,482 $ 408,391 $ 391,130 $ 395,991
(000 omitted)
Ratio of expenses to average .55% .55% .55% .55% .55%
net assets
Ratio of expenses to average .54% B .55% .55% .54% B .55%
net assets after expense
reductions
Ratio of net interest income 4.56% 4.56% 4.81% 4.96% 5.37%
to average net assets
Portfolio turnover rate 25% 24% 25% 28% 65%
</TABLE>
A THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT
BEEN REDUCED DURING THE PERIODS SHOWN.
B FMR OR THE FUND HAS ENTERED INTO VARYING ARRANGEMENTS WITH THIRD
PARTIES WHO EITHER PAID OR REDUCED A PORTION OF THE FUND'S EXPENSES.
SPARTAN FLORIDA MUNICIPAL MONEY MARKET FUND
PERFORMANCE: THE BOTTOM LINE
To evaluate a money market fund's historical performance, you can look
at either total return or yield. Total return reflects the change in
the value of an investment, assuming reinvestment of the fund's
dividend income but does not include the effect of the $5 account
closeout fee on an average-sized account. Yield measures the income
paid by a fund. Since a money market fund tries to maintain a $1 share
price, yield is an important measure of performance. If Fidelity had
not reimbursed certain fund expenses, the life of fund total returns
would have been lower.
CUMULATIVE TOTAL RETURNS
PERIODS ENDED NOVEMBER 30, PAST 1 YEAR PAST 5 YEARS LIFE OF FUND
1999
SPARTAN FL MUNICIPAL MONEY 2.85% 17.12% 23.98%
MARKET
Florida Tax-Free Money Market 2.68% 17.29% n/a
Funds Average
CUMULATIVE TOTAL RETURNS show the fund's performance in percentage
terms over a set period - in this case, one year, five years or since
the fund started on August 24, 1992. For example, if you had invested
$1,000 in a fund that had a 5% return over the past year, the value of
your investment would be $1,050. To measure how the fund's performance
stacked up against its peers, you can compare it to the Florida
tax-free money market funds average, which reflects the performance of
tax-free money market funds with similar objectives tracked by IBC
Financial Data, Inc. The past one year average represents a peer group
of 14 money market funds.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED NOVEMBER 30, PAST 1 YEAR PAST 5 YEARS LIFE OF FUND
1999
SPARTAN FL MUNICIPAL MONEY 2.85% 3.21% 3.00%
MARKET
Florida Tax-Free Money Market 2.68% 3.24% n/a
Funds Average
AVERAGE ANNUAL TOTAL RETURNS take the fund's cumulative return and
show you what would have happened if the fund had performed at a
constant rate each year.
YIELDS
11/29/99 8/30/99 5/31/99 3/1/99 11/30/98
Spartan Florida Municipal 3.32% 2.88% 2.79% 2.51% 2.85%
Money Market Fund
Florida Tax-Free Money Market 3.15% 2.66% 2.67% 2.45% 2.68%
Funds Average
Spartan Florida Municipal 5.19% 4.50% 4.36% 3.92% 4.45%
Money Market Fund -
Tax-equivalent
YIELD refers to the income paid by the fund over a given period.
Yields for money market funds are usually for seven-day periods,
expressed as annual percentage rates. A yield that assumes income
earned is reinvested or compounded is called an effective yield. The
table above shows the fund's current seven-day yield at quarterly
intervals over the past year. You can compare these yields to the
Florida tax-free money market funds average. Or you can look at the
fund's tax-equivalent yield, which is based on an effective 1999
federal income tax rate of 36%. A portion of the fund's income may be
subject to the federal alternative minimum tax. Figures for the
Florida tax-free money market funds average are from IBC Financial
Data, Inc.
A MONEY MARKET FUND'S TOTAL RETURNS AND YIELDS WILL VARY, AND REFLECT
PAST RESULTS RATHER THAN PREDICT FUTURE PERFORMANCE.
(checkmark)COMPARING
PERFORMANCE
Yields on tax-free investments
are usually lower than yields
on taxable investments.
However, a straight
comparison between the two
may be misleading because it
ignores the way taxes reduce
taxable returns. Tax-equivalent
yield - the yield you'd have to
earn on a similar taxable
investment to match the tax-free
yield - makes the comparison
more meaningful. Keep in
mind that the U.S. government
neither insures nor guarantees
a money market fund. In fact,
there is no assurance that a
money fund will maintain a $1
share price.
SPARTAN FLORIDA MUNICIPAL MONEY MARKET FUND
FUND TALK: THE MANAGER'S OVERVIEW
(photograph of Scott Orr)
An interview with Scott Orr, Portfolio Manager of Spartan Florida
Municipal Money Market Fund
Q. SCOTT, WHAT WAS THE INVESTMENT ENVIRONMENT LIKE OVER THE 12 MONTHS
THAT ENDED NOVEMBER 30, 1999?
A. At the beginning of the period, a global economic crisis continued
to cast a shadow over the market. There were many questions about the
pace of U.S. economic growth and the direction of interest rates.
Early in 1999, however, any doubts were put to rest, as both growth
and employment strengthened. In addition, data began to indicate that
inflation might not be as well-behaved as it had been in the recent
past. Faced with that backdrop, market observers began to feel that
the Federal Reserve Board would raise short-term interest rates to
slow growth and head off inflation. Through the rest of the period,
economic growth remained solid and unemployment stayed at historically
low levels. Such a tight labor market often leads to inflation, as
employers are forced to raise salaries in order to attract or retain
workers, passing on the additional cost to the consumer. The Fed
indicated that improvements in worker productivity had helped keep
inflation at bay. Nevertheless, with constant, broad-based economic
strength and continually tight labor markets, the Fed felt compelled
to take back all three of the rate cuts it had implemented in the fall
of 1998. It did so with a series of three 0.25 percentage point rate
hikes in June, August and November, raising the rate banks charge each
other for overnight loans - known as the fed funds rate - from 4.75%
at the beginning of the period to 5.50% by the end of November 1999.
Q. WHAT WAS YOUR STRATEGY?
A. At the end of 1998, the fund confronted its typical year-end
challenge, as investors sought to shelter some of their assets from
the Florida intangible tax levied at the end of each calendar year.
Handling the increase in assets dominated strategy at the beginning of
the period, as I kept the fund as fully invested as possible to make
sure its assets were appropriately shielded from the tax. From assets
of approximately $450 million in early December, the fund peaked at
over $1.2 billion on December 31. In January, I liquidated positions
to meet redemptions as the fund rapidly lost assets. Since then, I
kept the fund's average maturity fairly neutral, looking for
opportunities across a broad spectrum of issuers and maturities,
aiming to find securities that reflected my expectations for higher
rates. With the turn of the calendar year on the horizon, I've started
to focus again on keeping the fund invested as much as possible in
Florida securities, although the Florida state legislature amended the
law related to the intangible tax. Before, if the fund held even one
dollar in a non-Florida-exempt security, all of the fund's assets
could have been declared subject to the intangible tax. Now, the fund
is allowed to hold 10% of its assets in non-Florida-exempt securities
at calendar year end, while still remaining 100% exempt from the tax.
This will give me the option to take advantage of a wider array of
investments. While we welcome this added flexibility, our main goal
remains keeping the fund exempt from the intangible tax.
Q. HOW DID THE FUND PERFORM?
A. The fund's seven-day yield on November 30, 1999, was 3.32%,
compared to 2.85% 12 months ago. The more recent seven-day yield was
the equivalent of a 5.19% taxable rate of return for Florida investors
in the 36% federal income tax bracket. Through November 30, 1999, the
fund's 12-month total return was 2.85%, compared to 2.68% for the
Florida tax-free money market funds average, according to IBC
Financial Data, Inc.
Q. WHAT IS YOUR OUTLOOK?
A. Before the Fed's most recent rate hike, market sentiment reflected
the belief that the Fed would sit back and wait to see what happens
after bringing rates back to their 1998 levels. However, judging by
its reaction to the latest Fed move, the market doesn't feel the Fed
is done implementing rate increases. If the trends of tight employment
and economic strength continue, I believe it is likely the Fed will
raise rates again in early 2000 to slow growth and prevent inflation
from cropping up. The timing and scope of any Fed rate hikes would
most probably be dictated by the pace of the economy and the tightness
of the labor market.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO
MANAGER ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON
THE COVER AND DO NOT NECESSARILY REPRESENT THE VIEWS OF FIDELITY OR
ANY OTHER PERSON IN THE FIDELITY ORGANIZATION. ANY SUCH VIEWS ARE
SUBJECT TO CHANGE AT ANY TIME BASED UPON MARKET OR OTHER CONDITIONS
AND FIDELITY DISCLAIMS ANY RESPONSIBILITY TO UPDATE SUCH VIEWS. THESE
VIEWS MAY NOT BE RELIED ON AS INVESTMENT ADVICE AND, BECAUSE
INVESTMENT DECISIONS FOR A FIDELITY FUND ARE BASED ON NUMEROUS
FACTORS, MAY NOT BE RELIED ON AS AN INDICATION OF TRADING INTENT ON
BEHALF OF ANY FIDELITY FUND.
(checkmark)FUND FACTS
GOAL: high current tax-free
income exempt from federal
income tax and the Florida
intangible tax, as is
consistent with the
preservation of capital and
liquidity
FUND NUMBER: 428
TRADING SYMBOL: FSFXX
START DATE: August 24, 1992
SIZE: as of November 30,
1999, more than $460 million
MANAGER: Scott Orr, since
1997; manager, various
Fidelity and Spartan
municipal money market
funds; joined Fidelity in
1989
SPARTAN FLORIDA MUNICIPAL MONEY MARKET FUND
INVESTMENT CHANGES
<TABLE>
<CAPTION>
<S> <C> <C> <C>
MATURITY DIVERSIFICATION
DAYS % OF FUND'S INVESTMENTS % OF FUND'S INVESTMENTS 5/31/99 % OF FUND'S INVESTMENTS
11/30/99 11/30/98
0 - 30 57.4 71.1 59.5
31 - 90 20.4 12.9 24.4
91 - 180 13.2 10.6 8.7
181 - 397 9.0 5.4 7.4
WEIGHTED AVERAGE MATURITY
11/30/99 5/31/99 11/30/98
Spartan Florida Municipal 51 DAYS 41 Days 47 Days
Money Market Fund
Florida Tax-Free Money Market 55 DAYS 40 Days 48 Days
Funds Average *
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
ASSET ALLOCATION (% OF FUND'S
NET ASSETS)
AS OF NOVEMBER 30, 1999 AS OF MAY 31, 1999
Variable Rate Demand Notes Variable Rate Demand Notes
(VRDNs) 48.9% (VRDNs) 62.1%
Commercial Paper (including Commercial Paper (including
CP Mode) 33.0% CP Mode) 27.7%
Tender Bonds 0.0% Tender Bonds 0.8%
Municipal Notes 7.4% Municipal Notes 4.3%
Municipal Money Market Funds 7.2% Municipal Money Market Funds 0.0%
Other Investments and Net Other Investments and Net
Other Assets 3.5% Other Assets 5.1%
Row: 1, Col: 1, Value: 48.9 Row: 1, Col: 1, Value: 62.1
Row: 1, Col: 2, Value: nil Row: 1, Col: 2, Value: nil
Row: 1, Col: 3, Value: 33.0 Row: 1, Col: 3, Value: 27.7
Row: 1, Col: 4, Value: 0.0 Row: 1, Col: 4, Value: 0.8
Row: 1, Col: 5, Value: 7.4 Row: 1, Col: 5, Value: 4.3
Row: 1, Col: 6, Value: 7.2 Row: 1, Col: 6, Value: 0.0
Row: 1, Col: 7, Value: 0.0 Row: 1, Col: 7, Value: 0.0
Row: 1, Col: 8, Value: 3.5 Row: 1, Col: 8, Value: 5.1
</TABLE>
PRIOR TO THIS REPORT, CERTAIN INFORMATION RELATED TO PORTFOLIO
HOLDINGS WAS STATED AS A PERCENTAGE OF THE FUND'S INVESTMENTS.
SPARTAN FLORIDA MUNICIPAL MONEY MARKET FUND
INVESTMENTS NOVEMBER 30, 1999
Showing Percentage of Net Assets
<TABLE>
<CAPTION>
<S> <C> <C> <C>
MUNICIPAL SECURITIES - 98.5%
PRINCIPAL AMOUNT VALUE (NOTE 1)
DELAWARE - 0.5%
Delaware Econ. Dev. Auth.
Rev. (Delmarva Pwr. & Lt.
Co. Proj.):
Series 1987, 3.85%, VRDN $ 500,000 $ 500,000
(a)(d)
Series 1988, 3.85%, VRDN 1,700,000 1,700,000
(a)(d)
2,200,000
FLORIDA - 83.4%
Brevard County School 4,700,000 4,715,806
District TAN 4% 6/30/00
Broward County Fin. Auth. 1,800,000 1,800,000
Multi-family Hsg. Rev. (Palm
Aire-Oxford Proj.) Series
1990, 3.95% (Continental
Casualty Co. Guaranteed),
VRDN (a)
Broward County Ind. Dev. 1,050,000 1,050,000
Auth. Ind. Dev. Rev. (RIB
Associates Proj.) Series
1989, 4.05%, LOC SunTrust
Bank, Central FL NA, VRDN
(a)(d)
Broward County Ind. Dev. Rev. 1,500,000 1,500,000
(Femc & Fast Industries,
Inc. Proj.) 4.05%, LOC
Suntrust Bank, South Florida
NA, VRDN (a)(d)
Clay County Hsg. Fin. Auth. 1,880,000 1,880,000
Rev. Participating VRDN
Series PT 61, 4.03%
(Liquidity Facility
Bayerische Hypo-und
Vereinsbank AG) (a)(d)(e)
Collier County Ind. Dev. 5,400,000 5,400,000
Auth. (Cmnty. School of
Naples Proj.) Series 1999,
3.95%, LOC Bank of America
NA, VRDN (a)
Dade County Multi-family Hsg. 28,475,000 28,475,000
Rev. (Biscayne View Apts.
Proj.) Series 1993, 4.2%
(Monumental Life Ins. Co.
Guaranteed), VRDN (a)(d)
Dade County Spl. Oblig. 5,995,000 5,995,000
Participating VRDN Series MS
98 105, 3.97% (Liquidity
Facility Morgan Stanley Dean
Witter & Co.) (a)(e)
Dade County Wtr. & Swr. Rev. 5,960,000 5,960,000
Participating VRDN Series
1998 155, 3.97% (Liquidity
Facility Morgan Stanley Dean
Witter & Co.) (a)(e)
Escambia County Hsg. Fin. 1,320,000 1,320,000
Auth. Participating VRDN
Series PA 129, 4.03%
(Liquidity Facility Merrill
Lynch & Co., Inc.) (a)(d)(e)
Escambia County Poll. Cont. 4,775,000 4,775,000
Rev. Rfdg. (Monsanto Co.
Proj.) Series 1994, 3.9%,
VRDN (a)
Escambia County Solid Waste 5,300,000 5,300,000
Disp. Rev. (Monsanto Co.
Proj.) Series 1993, 4%, VRDN
(a)(d)
Florida Board of Ed. 9,900,000 9,900,000
Participating VRDN Series
96C0905, Class A 3.97%
(Liquidity Facility
Citibank, New York NA) (a)(e)
Florida Board of Ed. Cap. 2,875,000 2,877,246
Outlay Bonds Series A, 4.25%
1/1/00
MUNICIPAL SECURITIES -
CONTINUED
PRINCIPAL AMOUNT VALUE (NOTE 1)
FLORIDA - CONTINUED
Florida Div. Board Fin. Dept. $ 11,395,000 $ 11,395,000
Gen. Svcs. Revs.
Participating VRDN Series
61, 3.97% (Liquidity
Facility Morgan Stanley Dean
Witter & Co.) (a)(e)
Florida Hsg. Fin. Agcy.
Multi-family Hsg. Rev. Rfdg.:
(Brandon-Oxford Proj.) Series 13,100,000 13,100,000
1990 C, 3.95% (Continental
Casualty Co. Guaranteed),
VRDN (a)
(Hillsborough-Oxford Proj.) 5,590,000 5,590,000
Series D, 3.95% (Continental
Casualty Co. Guaranteed),
VRDN (a)
Florida Hsg. Fin. Corp. Rev.:
Participating VRDN Series 4,400,000 4,400,000
FRRI 12, 3.9% (Liquidity
Facility Bank of New York
NA) (a)(d)(e)
(Heritage Point Apts. Proj.) 4,750,000 4,750,000
Series I1, 3.9%, LOC Key
Bank NA, VRDN (a)(d)
(Timberline Apts. Proj.) 2,500,000 2,500,000
Series 1999 P, 3.95%, LOC
Key Bank NA, VRDN (a)(d)
(Valencia Village Apts. 4,400,000 4,400,000
Proj.) Series G, 3.9%, LOC
Key Bank NA, VRDN (a)(d)
Florida Local Govt. Fin.
Auth. Rev.:
Series A:
3.55% 1/18/00, LOC First 2,300,000 2,300,000
Union Nat'l. Bank, North
Carolina, CP
3.8% 1/18/00, LOC First Union 500,000 500,000
Nat'l. Bank, North Carolina,
CP
Series B, 3.65% 3/1/00, LOC 3,500,000 3,500,000
First Union Nat'l. Bank,
North Carolina, CP (d)
Florida Muni. Pwr. Agcy. 9,600,000 9,600,000
Series A, 3.45% 2/10/00,
LOC First Union Nat'l. Bank,
North Carolina, CP
Greater Orlando Aviation 4,800,000 4,800,000
Auth. Orlando Arpt.
Facilities Rev.
Participating VRDN Series PA
535, 4.03% (Liquidity
Facility Merrill Lynch &
Co., Inc.) (a)(d)(e)
Hillsborough County Ind. Dev.
Auth. Ind. Dev. Rev. (Vigo
Importing Co. Proj.):
4.05%, LOC Bank of America 1,010,000 1,010,000
NA, VRDN (a)(d)
4.35%, LOC Bank of America 1,200,000 1,200,000
NA, VRDN (a)(d)
Hillsborough County 2,700,000 2,700,000
Multi-family Rev. (Brandon
Crossing Apts. Proj.) Series
1998 A, 3.9%, LOC Amsouth
Bank, Birmingham, VRDN (a)(d)
Indian River County Hosp. 5,300,000 5,300,000
District Hosp. Rev. Bonds
Series 1990, 3.9% tender
2/1/00, LOC Kredietbank, CP
mode
Jacksonville 3.55% 1/21/00, CP 1,000,000 1,000,000
MUNICIPAL SECURITIES -
CONTINUED
PRINCIPAL AMOUNT VALUE (NOTE 1)
FLORIDA - CONTINUED
Jacksonville Elec. Auth. Rev.
Series A:
3.5% 1/28/00, CP $ 1,000,000 $ 1,000,000
3.65% 1/27/00, CP 1,000,000 1,000,000
3.75% 2/1/00, CP 1,500,000 1,500,000
Jacksonville Health 1,800,000 1,800,000
Facilities Rev. (Faculty
Practice Assoc. Proj.)
3.95%, LOC Bank of America
NA, VRDN (a)
Jacksonville Poll. Cont. Rev.
Rfdg. Bonds (Florida Pwr. &
Lt. Co. Proj.):
Series 1992:
3.2% tender 2/10/00, CP mode 3,900,000 3,900,000
3.75% tender 1/24/00, CP mode 1,500,000 1,500,000
Series 1994:
3.55% tender 1/26/00, CP mode 2,000,000 2,000,000
3.65% tender 1/28/00, CP mode 3,500,000 3,500,000
Lee County Hosp. Board Hosp.
Rev. Bonds (Lee Memorial
Hosp. Proj.):
Series 1985 D, 3.85% tender 4,700,000 4,700,000
4/11/00, CP mode
Series 1992 B:
3.7% tender 1/31/00, CP mode 4,000,000 4,000,000
3.7% tender 3/1/00, CP mode 5,800,000 5,800,000
Series 1995 A, 3.7% tender 13,900,000 13,900,000
3/1/00, CP mode
Series 1997 B, 3.85% tender 9,500,000 9,500,000
4/11/00, CP mode
Miami Dade County School 9,700,000 9,724,286
District TAN Series 1999,
4% 6/28/00
Miami-Dade County Ind. Dev. 3,020,000 3,020,000
Auth. Rev. (Edron Fixture
Corp. Proj.) Series 1999B,
4.05%, LOC SunTrust Bank,
Miami NA, VRDN (a)(d)
Miami-Dade County Ind. Dev. 4,400,000 4,400,000
Rev. (Airis Miami LLC Proj.)
Series 1999 A, 4% (AMBAC
Insured), VRDN (a)(d)
Ocean Hwy. & Port Auth. 200,000 200,000
Series 1990, 4%, LOC
ABN-AMRO Bank NV, VRDN (a)(d)
Okeechobee County Solid Waste 7,500,000 7,500,000
Rev. (Chambers Waste Sys.
Proj.) Series 1992, 4%, LOC
Morgan Guaranty Trust Co.,
NY, VRDN (a)(d)
Orange County Hsg. Fin. Auth. 5,950,000 5,950,000
(Westlake Club Proj.)
Series 1991 A, 4.1%
(Continental Casualty Co.
Guaranteed), VRDN (a)
Orange County Hsg. Fin. Auth.
Multi-family Hsg. Rev.:
(Falcon Trace Apt. Proj.) 4,050,000 4,050,000
Series 1998 D, 4%, LOC
Amsouth Bank, Birmingham,
VRDN (a)(d)
MUNICIPAL SECURITIES -
CONTINUED
PRINCIPAL AMOUNT VALUE (NOTE 1)
FLORIDA - CONTINUED
Orange County Hsg. Fin. Auth.
Multi-family Hsg. Rev.: -
continued
(Regal Pointe Apts. Proj.) $ 5,893,000 $ 5,893,000
Series 1997 A, 3.97%, LOC
Bank of America NA, LOC
NationsBank NA, VRDN (a)(d)
(Wtr. View Club Proj.) Series 4,000,000 4,000,000
1997 D, 4%, LOC Key Bank NA,
VRDN (a)(d)
Orange County Ind. Dev. Auth. 4,900,000 4,900,000
Ind. Rev. (Advanced Drainage
Sys., Inc. Proj.) 4.1%, LOC
Nat'l. City Bank, VRDN (a)(d)
Orlando Util. Commission Wtr. 4,365,000 4,365,000
& Elec. Rev. Rfdg.
Participating VRDN Series SG
18, 3.98% (Liquidity
Facility Societe Generale,
France) (a)(e)
Palm Beach County Rev. (Saint 4,000,000 4,000,000
Andrews School Boca Raton
Proj.) Series 1998, 3.95%,
LOC Bank of America NA, VRDN
(a)
Pasco County Ind. Dev. Rev. 2,150,000 2,150,000
(Pacific Med., Inc. Proj.)
Series 1999, 4.05%, LOC Bank
of America NA, VRDN (a)(d)
Pinellas County Hsg. Fin. 6,460,000 6,460,000
Auth. Single Family Hsg.
Rev. Bonds Series B 3, 3.45%
7/21/00 (AMBAC Insured) (d)
Pinellas County Ind. Council 2,100,000 2,100,000
Ind. Dev. Rev. (Hunter
Douglas, Inc. Proj.) 4.05%,
LOC ABN-AMRO Bank NV, VRDN
(a)(d)
Reedy Creek Impt. District 6,975,000 6,975,000
Participating VRDN Series
96C0904 Class A, 3.97%
(Liquidity Facility
Citibank, New York NA) (a)(e)
Saint Johns County Ind. Dev. 5,680,000 5,680,000
Auth. Rev. (V.A.W. of
America Proj.) Series 1997,
3.95%, LOC Bank of America
NA, VRDN (a)
Saint Lucie County Poll.
Cont. Rev. Rfdg. Bonds
(Florida Pwr. & Lt. Co.
Proj.):
Series 1992 A:
3.55% tender 1/25/00, CP mode 4,400,000 4,400,000
3.55% tender 1/28/00, CP mode 15,125,000 15,125,000
Series 1994 A, 3.65% tender 3,500,000 3,500,000
1/27/00, CP mode
Saint Petersburg Cap. Impt. 1,340,000 1,340,000
Rev. (Arpt. Proj.) Series
1997 C, 4.05%, LOC Suntrust
Bank, Tampa Bay, VRDN (a)(d)
Sarasota County Pub. Hosp. 4,200,000 4,200,000
Board Participating VRDN
Series 1998 99, 3.97%
(Liquidity Facility Morgan
Stanley Dean Witter & Co.)
(a)(e)
Sarasota County Pub. Hosp.
District Rev. Bonds:
(Sarasota Memorial Hosp. 3,800,000 3,800,000
Proj.) Series 1985 C, 3.55%
tender 1/28/00, LOC SunTrust
Bank, Central FL NA, CP mode
MUNICIPAL SECURITIES -
CONTINUED
PRINCIPAL AMOUNT VALUE (NOTE 1)
FLORIDA - CONTINUED
Sarasota County Pub. Hosp.
District Rev. Bonds: -
continued
Series A:
3.8% tender 3/1/00, CP mode $ 10,000,000 $ 10,000,000
3.8% tender 3/10/00, CP mode 12,600,000 12,600,000
Seminole County School 4,700,000 4,717,863
District TAN 4% 7/28/00
Sunrise Util. Sys. Rev. 2,325,000 2,325,000
Participating VRDN Series
SGB 17, 3.94% (Liquidity
Facility Societe Generale,
France) (a)(e)
Sunshine State Govt. Fing.
Commission Rev.:
Bonds Series 1986:
3.2% tender 1/28/00 (AMBAC 4,900,000 4,900,000
Insured), CP mode
3.75% tender 2/1/00 (AMBAC 4,700,000 4,700,000
Insured), CP mode
Series A:
3.65% 1/27/00 (AMBAC Insured) 5,000,000 5,000,000
(FGIC Insured), CP (d)
3.7% 12/1/99 (FGIC Insured) 2,000,000 2,000,000
(AMBAC Insured), CP
3.75% 2/1/00 (AMBAC Insured) 2,325,000 2,325,000
(FGIC Insured), CP (d)
Series C:
3.75% 1/21/00 (AMBAC Insured) 4,300,000 4,300,000
(FGIC Insured), CP (d)
3.8% 1/21/00 (AMBAC Insured) 4,400,000 4,400,000
(MBIA Insured) (FGIC
Insured), CP (d)
384,093,201
INDIANA - 0.9%
Indiana Dev. Fin. Auth. 4,000,000 4,000,000
Envir. Rev. Rfdg. (PSI
Energy Proj.) Series 1998,
3.85%, LOC Morgan Guaranty
Trust Co., NY, VRDN (a)(d)
KENTUCKY - 0.3%
Louisville & Jefferson County 1,500,000 1,500,000
Reg'l. Arpt. Auth. Series
1999 A, 3.75% (United Parcel
Svc. of America Guaranteed),
VRDN (a)(d)
LOUISIANA - 0.2%
Calcasieu Parish Ind. Dev. 1,100,000 1,100,000
Board Envir. Rev. (Citgo
Petroleum Corp. Proj.) 3.9%,
LOC Banque Nationale de
Paris, VRDN (a)(d)
NEW YORK - 1.9%
New York NY Participating 8,600,000 8,600,000
VRDN Series 1999 A51, 3.95%
(Liquidity Facility Bank of
New York NA) (a)(e)
MUNICIPAL SECURITIES -
CONTINUED
PRINCIPAL AMOUNT VALUE (NOTE 1)
TEXAS - 4.1%
Gulf Coast Waste Disp. Auth. $ 3,700,000 $ 3,700,000
Poll. Cont. & Solid Waste
Disp. Rev. (Amoco Oil Co.
Proj.) Series 1996, 3.85%,
VRDN (a)(d)
Texas Gen. Oblig. TRAN Series 15,000,000 15,086,068
1999 A, 4.5% 8/31/00
18,786,068
SHARES
OTHER - 7.2%
Municipal Central Cash Fund 33,023,980 33,023,980
3.90% (b)(c)
TOTAL INVESTMENT PORTFOLIO - 453,303,249
98.5%
NET OTHER ASSETS - 1.5% 7,001,494
NET ASSETS - 100% $ 460,304,743
Total Cost for Income Tax Purposes $ 453,303,249
</TABLE>
SECURITY TYPE ABBREVIATIONS
CP - COMMERCIAL PAPER
TAN - TAX ANTICIPATION NOTE
TRAN - TAX AND REVENUE
ANTICIPATION
VRDN - VARIABLE RATE DEMAND NOTE
LEGEND
(a) The coupon rate shown on floating or adjustable rate securities
represents the rate at period end.
(b) Information in this report regarding holdings by state and
security types does not reflect the holdings of the Municipal Central
Cash Fund. A listing of the Municipal Central Cash Fund's holdings as
of its most recent fiscal period end is available upon request.
(c) The rate quoted is the annualized seven-day yield of the fund at
period end.
(d) Private activity obligations whose interest is subject to the
federal alternative minimum tax for individuals.
(e) Provides evidence of ownership in one or more underlying municipal
bonds.
INCOME TAX INFORMATION
At November 30, 1999, the fund had a capital loss carryforward of
approximately $18,000, all of which will expire on November 30, 2005.
SPARTAN FLORIDA MUNICIPAL MONEY MARKET FUND
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
NOVEMBER 30, 1999
ASSETS
Investment in securities, at $ 453,303,249
value - See accompanying
schedule
Receivable for fund shares 4,784,519
sold
Interest receivable 3,137,453
TOTAL ASSETS 461,225,221
LIABILITIES
Payable for fund shares $ 641,208
redeemed
Distributions payable 96,762
Accrued management fee 180,881
Other payables and accrued 1,627
expenses
TOTAL LIABILITIES 920,478
NET ASSETS $ 460,304,743
Net Assets consist of:
Paid in capital $ 460,323,093
Accumulated undistributed net (18,350)
realized gain (loss) on
investments
NET ASSETS, for 460,323,093 $ 460,304,743
shares outstanding
NET ASSET VALUE, offering $1.00
price and redemption price
per share ($460,304,743
(divided by) 460,323,093
shares)
STATEMENT OF OPERATIONS
YEAR ENDED NOVEMBER 30, 1999
INTEREST INCOME $ 17,455,542
EXPENSES
Management fee $ 2,666,187
Non-interested trustees' 1,678
compensation
Total expenses before 2,667,865
reductions
Expense reductions (196,706) 2,471,159
NET INTEREST INCOME 14,984,383
REALIZED AND UNREALIZED GAIN 35,714
(LOSS)
Net Realized Gain (loss) on
Investment Securities
NET INCREASE (DECREASE) IN $ 15,020,097
NET ASSETS RESULTING FROM
OPERATIONS
<TABLE>
<CAPTION>
<S> <C> <C>
STATEMENT OF CHANGES IN NET ASSETS
YEAR ENDED NOVEMBER 30, 1999 YEAR ENDED NOVEMBER 30, 1998
INCREASE (DECREASE) IN NET
ASSETS
Operations Net interest income $ 14,984,383 $ 15,116,587
Net realized gain (loss) 35,714 1,483
NET INCREASE (DECREASE) IN 15,020,097 15,118,070
NET ASSETS RESULTING FROM
OPERATIONS
Distributions to shareholders (14,984,383) (15,116,587)
from net interest income
Share transactions at net 1,095,048,709 904,250,975
asset value of $1.00 per
share Proceeds from sales of
shares
Reinvestment of 13,287,124 14,292,014
distributions from net
interest income
Cost of shares redeemed (1,100,944,443) (887,072,623)
NET INCREASE (DECREASE) IN 7,391,390 31,470,366
NET ASSETS AND SHARES
RESULTING FROM SHARE
TRANSACTIONS
TOTAL INCREASE (DECREASE) 7,427,104 31,471,849
IN NET ASSETS
NET ASSETS
Beginning of period 452,877,639 421,405,790
End of period $ 460,304,743 $ 452,877,639
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
FINANCIAL HIGHLIGHTS
YEARS ENDED NOVEMBER 30, 1999 1998 1997 1996 1995
SELECTED PER-SHARE DATA
Net asset value, beginning $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
of period
Income from Investment .028 .031 .032 .031 .035
Operations Net interest
income
Less Distributions
From net interest income (.028) (.031) (.032) (.031) (.035)
Net asset value, end of period $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
TOTAL RETURN A, B 2.85% 3.17% 3.29% 3.17% 3.57%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 460,305 $ 452,878 $ 421,406 $ 402,278 $ 363,396
(000 omitted)
Ratio of expenses to average .50% .50% .50% .50% .50%
net assets
Ratio of expenses to average .46% C .48% C .49% C .47% C .50%
net assets after expense
reductions
Ratio of net interest income 2.81% 3.13% 3.21% 3.15% 3.52%
to average net assets
</TABLE>
A THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT
BEEN REDUCED DURING THE PERIODS SHOWN.
B TOTAL RETURNS DO NOT INCLUDE THE ACCOUNT CLOSEOUT FEE.
C FMR OR THE FUND HAS ENTERED INTO VARYING ARRANGEMENTS WITH THIRD
PARTIES WHO EITHER PAID OR REDUCED A PORTION OF THE FUND'S EXPENSES.
NOTES TO FINANCIAL STATEMENTS
For the period ended November 30, 1999
1. SIGNIFICANT ACCOUNTING POLICIES.
Spartan Florida Municipal Income Fund (the income fund) is a fund of
Fidelity Court Street Trust. Spartan Florida Municipal Money Market
Fund (the money market fund) is a fund of Fidelity Court Street Trust
II. Each trust is registered under the Investment Company Act of 1940,
as amended (the 1940 Act), as an open-end management investment
company. Fidelity Court Street Trust and Fidelity Court Street Trust
II (the trusts) are organized as a Massachusetts business trust and a
Delaware business trust, respectively. Each fund is authorized to
issue an unlimited number of shares. The financial statements have
been prepared in conformity with generally accepted accounting
principles which require management to make certain estimates and
assumptions at the date of the financial statements. Each fund may be
affected by economic and political developments in the state of
Florida. The following summarizes the significant accounting policies
of the income fund and the money market fund:
SECURITY VALUATION.
INCOME FUND. Securities are valued based upon a computerized matrix
system and/or appraisals by a pricing service, both of which consider
market transactions and dealer-supplied valuations. Securities
(including restricted securities) for which quotations are not readily
available are valued at their fair value as determined in good faith
under consistently applied procedures under the general supervision of
the Board of Trustees. Short-term securities with remaining maturities
of sixty days or less for which quotations are not readily available
are valued at amortized cost or original cost plus accrued interest,
both of which approximate current value.
MONEY MARKET FUND. As permitted under Rule 2a-7 of the 1940 Act, and
certain conditions therein, securities are valued initially at cost
and thereafter assume a constant amortization to maturity of any
discount or premium.
INCOME TAXES. As a qualified regulated investment company under
Subchapter M of the Internal Revenue Code, each fund is not subject to
income taxes to the extent that it distributes substantially all of
its taxable income for the fiscal year. The schedules of investments
include information regarding income taxes under the caption "Income
Tax Information."
INTEREST INCOME. Interest income, which includes amortization of
premium and accretion of original issue discount, is accrued as
earned. For the money market fund, accretion of discount represents
unrealized gain until realized at the time of a security disposition
or maturity.
EXPENSES. Most expenses of each trust can be directly attributed to a
fund. Expenses which cannot be directly attributed are apportioned
among the funds in the trust.
DISTRIBUTIONS TO SHAREHOLDERS. Dividends are declared daily and paid
monthly from net interest income. Distributions to shareholders from
realized capital gains on investments, if any, are recorded on the
ex-dividend date.
1. SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
DISTRIBUTIONS TO SHAREHOLDERS - CONTINUED
Income and capital gain distributions are determined in accordance
with income tax regulations which may differ from generally accepted
accounting principles. These differences, which may result in
distribution reclassifications, are primarily due to differing
treatments for futures transactions and losses deferred due to wash
sales and futures transactions. The income fund also utilized earnings
and profits distributed to shareholders on redemption of shares as a
part of the dividends paid deduction for income tax purposes.
Permanent book and tax basis differences relating to shareholder
distributions will result in reclassifications to paid in capital and
may affect the per-share allocation between net interest income and
realized and unrealized gain (loss). Accumulated undistributed net
realized gain (loss) on investments may include temporary book and tax
basis differences that will reverse in a subsequent period. Any
taxable gain remaining at fiscal year end is distributed in the
following year.
SHORT-TERM TRADING (REDEMPTION) FEES. Shares held in the income fund
less than 180 days are subject to a short-term trading fee equal to
.50% of the proceeds of the redeemed shares. The fee, which is
retained by the fund, is accounted for as an addition to paid in
capital.
SECURITY TRANSACTIONS. Security transactions are accounted for as of
trade date. Gains and losses on securities sold are determined on the
basis of identified cost.
2. OPERATING POLICIES.
MUNICIPAL CENTRAL CASH FUND. Pursuant to an Exemptive Order issued by
the Securities and Exchange Commission (the SEC), the funds may invest
in the Municipal Central Cash Fund (the Cash Fund) managed by Fidelity
Investments Money Management, Inc. (FIMM), an affiliate of Fidelity
Management & Research Company (FMR). The Cash Fund is an open-end
money market fund available only to investment companies and other
accounts managed by FMR and its affiliates. The Cash Fund seeks
preservation of capital, liquidity, and current income by investing in
high-quality, short-term municipal securities of various states and
municipalities. Income distributions from the Cash Fund are declared
daily and paid monthly from net interest income. Income distributions
earned by the funds are recorded as interest income in the
accompanying financial statements.
WHEN-ISSUED SECURITIES. Each fund may purchase or sell securities on a
when-issued basis. Payment and delivery may take place after the
customary settlement period for that security. The price of the
underlying securities is fixed at the time the transaction is
negotiated. The market values of the securities purchased on a
when-issued or forward commitment basis are identified as such in each
applicable fund's schedule of investments. Each fund may receive
compensation for interest forgone in the purchase of a when-issued
security. With
2. OPERATING POLICIES - CONTINUED
WHEN-ISSUED SECURITIES - CONTINUED
respect to purchase commitments, each fund identifies securities as
segregated in its records with a value at least equal to the amount of
the commitment. Losses may arise due to changes in the market value of
the underlying securities, if the counterparty does not perform under
the contract, or if the issuer does not issue the securities due to
political, economic, or other factors.
FUTURES CONTRACTS. The income fund may use futures contracts to manage
its exposure to the bond market and to fluctuations in interest rates.
Buying futures tends to increase the fund's exposure to the underlying
instrument, while selling futures tends to decrease the fund's
exposure to the underlying instrument or hedge other fund investments.
Losses may arise from changes in the value of the underlying
instruments or if the counterparties do not perform under the
contracts' terms. Gains (losses) are realized upon the expiration or
closing of the futures contracts. Futures contracts are valued at the
settlement price established each day by the board of trade or
exchange on which they are traded.
RESTRICTED SECURITIES. Certain funds are permitted to invest in
securities that are subject to legal or contractual restrictions on
resale. These securities generally may be resold in transactions
exempt from registration or to the public if the securities are
registered. Disposal of these securities may involve time-consuming
negotiations and expense, and prompt sale at an acceptable price may
be difficult. Information regarding restricted securities is included
under the caption "Other Information" at the end of each applicable
fund's schedule of investments.
3. PURCHASES AND SALES OF INVESTMENTS.
INCOME FUND. Purchases and sales of securities, other than short-term
securities, aggregated $112,385,865 and $108,931,485, respectively.
The market value of futures contracts opened and closed during the
period amounted to $5,206,510 and $11,490,878, respectively.
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES.
MANAGEMENT FEE. As each fund's investment adviser, FMR receives a fee
that is computed daily at an annual rate of .55% and .50% of average
net assets for the income fund and money market fund, respectively.
FMR pays all other expenses, except the compensation of the
non-interested Trustees and certain exceptions such as interest,
taxes, brokerage commissions and extraordinary expenses. The
management fee paid to FMR by each fund is reduced by an amount equal
to the fees and expenses paid by each fund to the non-interested
Trustees.
FMR also bears the cost of providing shareholder services to each
fund. To offset the cost of providing these services, FMR or its
affiliates collected certain transaction fees from the money market
fund's shareholders which amounted to $3,453 for the period.
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES - CONTINUED
SUB-ADVISER FEE. As the income and the money market funds' investment
sub-adviser, FIMM, a wholly owned subsidiary of FMR, receives a fee
from FMR of 50% of the management fee payable to FMR. The fee is paid
prior to any voluntary expense reimbursements which may be in effect.
MONEY MARKET INSURANCE. Pursuant to an Exemptive Order issued by the
SEC, the money market fund, along with other money market funds
advised by FMR or its affiliates, has entered into insurance
agreements with FIDFUNDS Mutual Limited (FIDFUNDS), an affiliated
mutual insurance company, effective January 1, 1999. FIDFUNDS provides
limited coverage for certain loss events including issuer default as
to payment of principal or interest and bankruptcy or insolvency of a
credit enhancement provider. The insurance does not cover losses
resulting from changes in interest rates, ratings downgrades or other
market conditions. The money market fund may be subject to a special
assessment of up to approximately 2.5 times the money market fund's
annual gross premium if covered losses exceed certain levels. During
the period, FMR has borne the cost of the money market fund's premium
payable to FIDFUNDS.
5. EXPENSE REDUCTIONS.
Effective January 1, 2000, FMR voluntarily agreed to reimburse
operating expenses (excluding interest, taxes, brokerage commissions
and extraordinary expenses, if any) for the income fund above an
annual rate of .53% of the funds average net assets.
In addition, through arrangements with the funds' custodian and
transfer agent, credits realized as a result of uninvested cash
balances were used to reduce a portion of each applicable fund's
expenses. During the period, expenses were reduced by $23,082 and
$196,706 for the income fund and the money market fund, respectively,
under these arrangements.
REPORT OF INDEPENDENT ACCOUNTANTS
To the Trustees of Fidelity Court Street Trust and Fidelity Court
Street Trust II and the Shareholders of Spartan Florida Municipal
Income Fund and Spartan Florida Municipal Money Market Fund:
In our opinion, the accompanying statements of assets and liabilities,
including the schedules of investments, and the related statements of
operations and of changes in net assets and the financial highlights
present fairly, in all material respects, the financial position of
Spartan Florida Muncipal Income Fund (a fund of Fidelity Court Street
Trust) and Spartan Florida Municipal Money Market Fund (a fund of
Fidelity Court Street Trust II) at November 30, 1999, and the results
of their operations, the changes in their net assets and the
financial highlights for the periods indicated, in conformity with
generally accepted accounting principles. These financial statements
and financial highlights (hereafter referred to as "financial
statements") are the responsibility of the fund's management; our
responsibility is to express an opinion on these financial statements
based on our audits. We conducted our audits of these financial
statements in accordance with generally accepted auditing standards
which require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements,
assessing the accounting principles used
and significant estimates made by management, and evaluating the
overall financial statement presentation. We believe that our audits,
which included confirmation of securities at November 30, 1999 by
correspondence with the custodian and brokers, provide a reasonable
basis for the opinion expressed above.
/s/PricewaterhouseCoopers LLP
PricewaterhouseCoopers LLP
Boston, Massachusetts
January 10, 2000
DISTRIBUTIONS
The Board of Trustees of Spartan Florida Municipal Income Fund voted
to pay to shareholders of record at the opening of business on record
date, the following distributions derived from capital gains realized
from sales of portfolio securities:
PAY DATE RECORD DATE CAPITAL GAINS
12/31/98 12/30/98 $.090
12/23/99 12/22/99 $.028
The fund hereby designates 100% of the long-term capital gains
dividends distributed during the fiscal year as 20%-rate capital gain
dividend.
During fiscal year ended 1999, 100% of the income and money market
funds' income dividends were free from federal income tax, and 18.24%
and 28.28%, respectively, of the funds' income dividends were subject
to the federal alternative minimum tax.
The funds will notify shareholders in January 2000 of amounts for use
in preparing 1999 income tax returns.
PROXY VOTING RESULTS
A special meeting of Spartan Florida Municipal Income Fund's
shareholders was held on December 15, 1999. The results of votes taken
among shareholders on proposals before them are reported below. Each
vote reported represents one dollar of net asset value held on the
record date for the meeting.
PROPOSAL 1
To elect a Board of Trustees.*
# OF % OF
VOTES CAST VOTES CAST
RALPH F. COX
Affirmative 3,135,419,311.04 97.006
Against 0 00.000
Withheld 96,777,025.22 2.994
Abstain 0 00.000
TOTAL 3,232,196,336.26 100.00
PHYLLIS BURKE DAVIS
Affirmative 3,132,582,110.71 96.918
Against 0 00.000
Withheld 99,614,225.55 3.082
Abstain 0 00.000
TOTAL 3,232,196,336.26 100.000
ROBERT M. GATES
Affirmative 3,135,664,806.55 97.013
Against 0 00.000
Withheld 96,531,529.71 2.987
Abstain 0 00.000
TOTAL 3,232,196,336.26 100.000
EDWARD C. JOHNSON 3D
Affirmative 3,134,639,545.56 96.982
Against 0 00.000
Withheld 97,556,790.70 3.018
Abstain 1,000,000,000.000 00.000
TOTAL 3,232,196,336.26 100.000
DONALD J. KIRK
Affirmative 3,136,284,719.58 97.033
Against 0 00.000
Withheld 95,911,616.68 2.967
Abstain 0 00.000
TOTAL 3,232,196,336.26 100.000
PETER S. LYNCH
Affirmative 3,138,556,508.13 97.103
Against 0 00.000
Withheld 93,639,828.13 2.897
Abstain 0 00.000
TOTAL 3,232,196,336.26 100.000
# OF % OF
VOTES CAST VOTES CAST
WILLIAM O. MCCOY
Affirmative 3,136,319,971.15 97.034
Against 0 00.000
Withheld 95,876,365.11 2.966
Abstain 0 00.000
TOTAL 3,232,196,336.26 100.000
GERALD C. MCDONOUGH
Affirmative 3,128,315,051.03 96.786
Against 0 00.000
Withheld 103,881,285.23 3.214
Abstain 0 00.000
TOTAL 3,232,196,336.26 100.000
MARVIN L. MANN
Affirmative 3,136,894,405.50 97.051
Against 0 00.000
Withheld 95,301,930.76 2.949
Abstain 0 00.000
TOTAL 3,232,196,336.26 100.000
ROBERT C. POZEN
Affirmative 3,137,057,584.79 97.057
Against 0 00.000
Withheld 95,138,751.47 2.943
Abstain 0 00.000
TOTAL 3,232,196,336.26 100.000
THOMAS R. WILLIAMS
Affirmative 3,128,882,711.68 96.804
Against 0 00.000
Withheld 103,313,624.58 3.196
Abstain 0 00.000
TOTAL 3,232,196,336.26 100.000
NED C. LAUTENBACH
Affirmative 3,137,914,510.94 97.083
Against 0 00.000
Withheld 94,281,825.32 2.917
Abstain 0 00.000
TOTAL 3,232,196,336.26 100.000
PROPOSAL 2
To ratify the selection of PricewaterhouseCoopers LLP as independent
accountants of the fund.
# OF % OF
VOTES CAST VOTES CAST
Affirmative 252,236,926.10 96.737
Against 2,976,924.65 1.142
Withheld 0 00.000
Abstain 5,530,243.79 2.121
TOTAL 260,744,094.54 100.000
Broker Non-Votes
PROPOSAL 3
To authorize the Trustees to adopt an amended and restated Declaration
of Trust.*
# OF % OF
VOTES CAST VOTES CAST
Affirmative 2,887,949,756.03 90.562
Against 150,461,756.38 4.718
Withheld 0 00.000
Abstain 150,503,417.13 4.720
TOTAL 3,188,914,929.54 100.00
Broker Non-Votes 43,281,406.72
PROPOSAL 5
To approve an amended management contract, including a management fee
structure change, for Spartan Florida Municipal Income Fund.
# OF % OF
VOTES CAST VOTES CAST
Affirmative 219,306,255.38 84.714
Against 24,660,887.30 9.526
Withheld 0 00.000
Abstain 14,911,388.11 5.760
TOTAL 258,878,530.79 100.000
Broker Non-Votes 1,865,563.75
PROPOSAL 9
To eliminate Spartan Florida Municipal Income Fund's fundamental 80%
investment policy and adopt a comparable non-fundamental policy.
# OF % OF
VOTES CAST VOTES CAST
Affirmative 226,729,265.72 87.581
Against 16,577,101.00 6.404
Withheld 0 00.000
Abstain 15,572,164.07 6.015
TOTAL 258,878,530.79 100.000
Broker Non-Votes 1,865,563.75
PROPOSAL 11
To eliminate Spartan Florida Municipal Income Fund's fundamental
investment policies regarding investments in debt securities of
investment-grade quality and below investment-grade quality.
# OF % OF
VOTES CAST VOTES CAST
Affirmative 223,418,309.73 86.302
Against 20,321,012.04 7.850
Withheld 0 00.000
Abstain 15,139,209.02 5.848
TOTAL 258,878,530.79 100.000
Broker Non-Votes 1,865,563.75
*DENOTES TRUST-WIDE PROPOSALS AND VOTING RESULTS.
INVESTMENT ADVISER
Fidelity Management & Research
Company
Boston, MA
INVESTMENT SUB-ADVISER,
MONEY MARKET FUND
Fidelity Investments
Money Management, Inc. (FIMM),
Merrimack, NH
OFFICERS
Edward C. Johnson 3d, President
Robert C. Pozen, Senior Vice President
Fred L. Henning, Jr., Vice President
Dwight D. Churchill, Vice President -
INCOME FUND
Boyce I. Greer, Vice President -
MONEY MARKET FUND
Christine J. Thompson, Vice President -
INCOME FUND
Scott A. Orr, Vice President -
MONEY MARKET FUND
Eric D. Roiter, Secretary
Richard A. Silver, Treasurer
Matthew N. Karstetter, Deputy Treasurer
Stanley N. Griffith, Assistant
Vice President
John H. Costello, Assistant Treasurer
Thomas J. Simpson, Assistant Treasurer
BOARD OF TRUSTEES
Ralph F. Cox *
Phyllis Burke Davis *
Robert M. Gates *
Edward C. Johnson 3d
E. Bradley Jones *
Donald J. Kirk *
Peter S. Lynch
Marvin L. Mann *
William O. McCoy *
Gerald C. McDonough *
Robert C. Pozen
Thomas R. Williams *
* INDEPENDENT TRUSTEES
SFC-ANN-0100 88394
1.539163.102
ADVISORY BOARD
J. Gary Burkhead
Abigail P. Johnson
Ned C. Lautenbach
GENERAL DISTRIBUTOR
Fidelity Distributors Corporation
Boston, MA
TRANSFER AND SHAREHOLDER
SERVICING AGENTS
Citibank, N.A.
New York, NY
and
Fidelity Service Company, Inc.
Boston, MA
CUSTODIAN
Citibank, N.A.
New York, NY
THE FIDELITY TELEPHONE CONNECTION
MUTUAL FUND 24-HOUR SERVICE
Exchanges/Redemptions
and Account Assistance 1-800-544-6666
Product Information 1-800-544-6666
Retirement Accounts 1-800-544-4774 (8 a.m. - 9 p.m.)
TDD Service 1-800-544-0118
for the deaf and hearing impaired
(9 a.m. - 9 p.m. Eastern time)
Fidelity Automated Service
Telephone (FASTSM) 1-800-544-5555
AUTOMATED LINE FOR QUICKEST SERVICE
(2_FIDELITY_LOGOS)(registered trademark)
Corporate Headquarters
82 Devonshire St., Boston, MA 02109
www.fidelity.com
SPARTAN(REGISTERED TRADEMARK)
CONNECTICUT MUNICIPAL
FUNDS
AND
FIDELITY(REGISTERED TRADEMARK)
CONNECTICUT MUNICIPAL
MONEY MARKET FUND
ANNUAL REPORT
NOVEMBER 30, 1999
(2_FIDELITY_LOGOS)(registered trademark)
CONTENTS
PRESIDENT'S MESSAGE 3 NED JOHNSON ON INVESTING
STRATEGIES
SPARTAN CONNECTICUT MUNICIPAL
INCOME FUND
4 PERFORMANCE
7 FUND TALK: THE MANAGER'S
OVERVIEW
10 INVESTMENT CHANGES
11 INVESTMENTS
19 FINANCIAL STATEMENTS
SPARTAN CONNECTICUT MUNICIPAL
MONEY MARKET FUND
23 PERFORMANCE
25 FUND TALK: THE MANAGER'S
OVERVIEW
27 INVESTMENT CHANGES
28 INVESTMENTS
32 FINANCIAL STATEMENTS
FIDELITY CONNECTICUT
MUNICIPAL MONEY MARKET FUND
36 PERFORMANCE
38 FUND TALK: THE MANAGER'S
OVERVIEW
40 INVESTMENT CHANGES
41 INVESTMENTS
46 FINANCIAL STATEMENTS
NOTES 50 NOTES TO THE FINANCIAL
STATEMENTS
REPORT OF INDEPENDENT 55 THE AUDITORS' OPINION
ACCOUNTANTS
PROXY VOTING RESULTS 56
Standard & Poor's, S&P and S&P 500 are registered service marks of The
McGraw-Hill Companies, Inc. and have been licensed for use by Fidelity
Distributors Corporation.
Other third party marks appearing herein are the property of their
respective owners.
All other marks appearing herein are registered or unregistered
trademarks or service marks of FMR Corp. or an affiliated company.
This report is printed on recycled paper using soy-based inks.
THIS REPORT AND THE FINANCIAL STATEMENTS CONTAINED HEREIN ARE
SUBMITTED FOR THE GENERAL
INFORMATION OF THE SHAREHOLDERS OF THE FUNDS. THIS REPORT IS NOT
AUTHORIZED FOR DISTRIBUTION TO
PROSPECTIVE INVESTORS IN THE FUNDS UNLESS PRECEDED OR ACCOMPANIED BY
AN EFFECTIVE PROSPECTUS.
MUTUAL FUND SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED
BY, ANY DEPOSITORY INSTITUTION. SHARES ARE NOT INSURED BY THE FDIC,
FEDERAL RESERVE BOARD OR ANY OTHER AGENCY, AND ARE SUBJECT TO
INVESTMENT RISKS, INCLUDING POSSIBLE LOSS OF PRINCIPAL AMOUNT
INVESTED.
NEITHER THE FUNDS NOR FIDELITY DISTRIBUTORS CORPORATION IS A BANK.
FOR MORE INFORMATION ON ANY FIDELITY FUND, INCLUDING CHARGES AND
EXPENSES, CALL 1-800-544-6666
FOR A FREE PROSPECTUS. READ IT CAREFULLY BEFORE YOU INVEST OR SEND
MONEY.
PRESIDENT'S MESSAGE
(PHOTO_OF_EDWARD_C_JOHNSON_3D)
DEAR SHAREHOLDER:
U.S. equity indexes once again dominated the financial headlines, led
by the NASDAQ's 15 record highs in 21 November sessions. Meanwhile,
the Standard & Poor's 500SM posted two record closings and the Dow
Jones Industrial Average crept above the 11,000 mark for the first
time since mid-September. However, another Federal Reserve Board
interest rate hike and continued inflation concerns drove down the
price of the benchmark 30-year Treasury.
While it's impossible to predict the future direction of the markets
with any degree of certainty, there are certain basic principles that
can help investors plan for their future needs.
The longer your investment time frame, the less likely it is that you
will be affected by short-term market volatility. A 10-year investment
horizon appropriate for saving for a college education, for example,
enables you to weather market cycles in a long-term fund, which may
have a higher risk potential, but also has a higher potential rate of
return.
An intermediate-length fund could make sense if your investment
horizon is two to four years, while a short-term bond fund could be
the right choice if you need your money in one or two years.
If your time horizon is less than a year, you might want to consider
moving some of your bond investment into a money market fund. These
funds seek income and a stable share price by investing in
high-quality, short-term investments. Of course, it's important to
remember that an investment in a money market fund is not insured or
guaranteed by the Federal Deposit Insurance Corporation or any other
government agency. Although money market funds seek to preserve the
value of your investment at $1.00 per share, it is possible to lose
money by investing in these types of funds.
Finally, no matter what your time horizon or portfolio diversity, it
makes good sense to follow a regular investment plan, investing a
certain amount of money in a fund at the same time each month or
quarter and periodically reviewing your overall portfolio. By doing
so, you won't get caught up in the excitement of a rapidly rising
market, nor will you buy all your shares at market highs. While this
strategy - known as dollar cost averaging - won't assure a profit or
protect you from a loss in a declining market, it should help you
lower the average cost of your purchases. Of course, you should
consider your financial ability to continue your purchases through
periods of low price levels before undertaking such a strategy.
If you have questions, please call us at 1-800-544-6666, or visit our
web site at www.fidelity.com. We are available 24 hours a day, seven
days a week to provide you the information you need to make the
investments that are right for you.
Best regards,
Edward C. Johnson 3d
SPARTAN CONNECTICUT MUNICIPAL INCOME FUND
PERFORMANCE: THE BOTTOM LINE
There are several ways to evaluate a fund's historical performance.
You can look at the total percentage change in value, the average
annual percentage change or the growth of a hypothetical $10,000
investment. Total return reflects the change in the value of an
investment, assuming reinvestment of the fund's dividend income and
capital gains (the profits earned upon the sale of securities that
have grown in value). You can also look at the fund's income, as
reflected in the fund's yield, to measure performance. If Fidelity had
not reimbursed certain fund expenses, the past 10 years total returns
would have been lower.
CUMULATIVE TOTAL RETURNS
PERIODS ENDED NOVEMBER 30, 1999 PAST 1 YEAR PAST 5 YEARS PAST 10 YEARS
SPARTAN CT MUNICIPAL INCOME -1.12% 42.93% 87.76%
LB Connecticut 4 Plus Year -0.83% 43.91% n/a
Enhanced Municipal Bond
Connecticut Municipal Debt -2.70% 38.78% 84.05%
Funds Average
CUMULATIVE TOTAL RETURNS show the fund's performance in percentage
terms over a set period - in this case, one year, five years or 10
years. For example, if you had invested $1,000 in a fund that had a 5%
return over the past year, the value of your investment would be
$1,050. You can compare the fund's returns to the performance of the
Lehman Brothers Connecticut 4 Plus Year Enhanced Municipal Bond Index
- - a market value-weighted index of Connecticut investment-grade
municipal bonds with maturities of four years or more. To measure how
the fund's performance stacked up against its peers, you can compare
it to the Connecticut municipal debt funds average, which reflects the
performance of mutual funds with similar objectives tracked by Lipper
Inc. The past one year average represents a peer group of 28 mutual
funds. These benchmarks include reinvested dividends and capital
gains, if any, and exclude the effect of sales charges.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED NOVEMBER 30, 1999 PAST 1 YEAR PAST 5 YEARS PAST 10 YEARS
SPARTAN CT MUNICIPAL INCOME -1.12% 7.40% 6.50%
LB Connecticut 4 Plus Year -0.83% 7.55% n/a
Enhanced Municipal Bond
Connecticut Municipal Debt -2.70% 6.77% 6.29%
Funds Average
AVERAGE ANNUAL TOTAL RETURNS take the fund's cumulative return and
show you what would have happened if the fund had performed at a
constant rate each year. (Note: Lipper calculates average annual total
returns by annualizing each fund's total return, then taking an
arithmetic average. This may produce a different figure than that
obtained by averaging the cumulative total returns and annualizing the
result.)
$10,000 OVER 10 YEARS
Spartan CT Muni Income LB Municipal Bond
00407 LB015
1989/11/30 10000.00 10000.00
1989/12/31 10064.60 10081.80
1990/01/31 9975.38 10034.11
1990/02/28 10066.06 10123.42
1990/03/31 10083.62 10126.45
1990/04/30 9926.21 10053.14
1990/05/31 10173.10 10272.60
1990/06/30 10276.46 10362.89
1990/07/31 10429.36 10515.23
1990/08/31 10241.83 10362.55
1990/09/30 10308.05 10368.45
1990/10/31 10463.60 10556.54
1990/11/30 10689.30 10768.83
1990/12/31 10738.08 10815.67
1991/01/31 10857.25 10960.82
1991/02/28 10925.61 11056.18
1991/03/31 10943.09 11060.16
1991/04/30 11082.17 11207.26
1991/05/31 11180.44 11306.89
1991/06/30 11094.01 11295.70
1991/07/31 11225.70 11433.28
1991/08/31 11347.67 11583.86
1991/09/30 11449.43 11734.68
1991/10/31 11562.30 11840.29
1991/11/30 11590.14 11873.33
1991/12/31 11874.18 12128.13
1992/01/31 11892.22 12155.78
1992/02/29 11898.10 12159.67
1992/03/31 11843.72 12164.17
1992/04/30 11906.32 12272.43
1992/05/31 12069.37 12416.88
1992/06/30 12307.15 12625.23
1992/07/31 12690.65 13003.74
1992/08/31 12511.04 12876.95
1992/09/30 12596.69 12961.16
1992/10/31 12382.01 12833.76
1992/11/30 12716.34 13063.61
1992/12/31 12849.99 13196.99
1993/01/31 13041.61 13350.47
1993/02/28 13571.86 13833.36
1993/03/31 13387.19 13687.14
1993/04/30 13510.58 13825.24
1993/05/31 13589.59 13902.94
1993/06/30 13830.32 14134.98
1993/07/31 13850.80 14153.49
1993/08/31 14164.96 14448.17
1993/09/30 14336.74 14612.73
1993/10/31 14344.41 14640.94
1993/11/30 14218.39 14511.95
1993/12/31 14517.62 14818.30
1994/01/31 14685.63 14987.52
1994/02/28 14281.61 14599.35
1994/03/31 13631.83 14004.86
1994/04/30 13748.95 14123.62
1994/05/31 13830.87 14246.07
1994/06/30 13744.98 14159.03
1994/07/31 14020.86 14418.57
1994/08/31 14052.41 14468.45
1994/09/30 13821.51 14256.06
1994/10/31 13513.65 14002.87
1994/11/30 13136.66 13749.70
1994/12/31 13499.10 14052.33
1995/01/31 13931.08 14453.94
1995/02/28 14357.01 14874.26
1995/03/31 14510.30 15045.17
1995/04/30 14526.89 15062.92
1995/05/31 14978.81 15543.58
1995/06/30 14844.03 15408.35
1995/07/31 14929.11 15554.42
1995/08/31 15136.88 15751.65
1995/09/30 15258.89 15851.36
1995/10/31 15452.76 16081.84
1995/11/30 15686.26 16348.64
1995/12/31 15810.22 16505.75
1996/01/31 15948.09 16630.37
1996/02/29 15870.16 16518.11
1996/03/31 15655.54 16307.01
1996/04/30 15622.70 16260.86
1996/05/31 15592.64 16254.36
1996/06/30 15789.41 16431.37
1996/07/31 15915.80 16580.89
1996/08/31 15897.99 16576.91
1996/09/30 16097.01 16808.99
1996/10/31 16283.50 16999.10
1996/11/30 16571.78 17310.18
1996/12/31 16480.12 17237.48
1997/01/31 16537.25 17270.06
1997/02/28 16676.60 17428.60
1997/03/31 16449.53 17196.27
1997/04/30 16579.09 17340.21
1997/05/31 16801.62 17601.00
1997/06/30 16976.72 17788.45
1997/07/31 17473.48 18281.19
1997/08/31 17285.29 18109.90
1997/09/30 17508.06 18324.86
1997/10/31 17611.29 18442.69
1997/11/30 17711.50 18551.14
1997/12/31 17985.51 18821.80
1998/01/31 18168.55 19016.04
1998/02/28 18156.31 19021.74
1998/03/31 18150.16 19038.48
1998/04/30 18078.75 18952.62
1998/05/31 18344.00 19252.64
1998/06/30 18399.41 19328.49
1998/07/31 18424.45 19377.01
1998/08/31 18707.56 19676.38
1998/09/30 18957.15 19921.55
1998/10/31 18933.06 19921.15
1998/11/30 18987.55 19991.08
1998/12/31 19029.26 20041.45
1999/01/31 19318.34 20279.75
1999/02/28 19169.70 20191.12
1999/03/31 19160.89 20219.19
1999/04/30 19216.31 20269.54
1999/05/31 19073.23 20152.18
1999/06/30 18774.95 19861.98
1999/07/31 18867.50 19934.28
1999/08/31 18755.94 19774.81
1999/09/30 18761.36 19782.91
1999/10/31 18598.02 19568.47
1999/11/30 18775.81 19776.68
IMATRL PRASUN SHR__CHT 19991130 19991213 143402 R00000000000123
$10,000 OVER 10 YEARS: Let's say hypothetically that $10,000 was
invested in Spartan Connecticut Municipal Income Fund on November 30,
1989. As the chart shows, by November 30, 1999, the value of the
investment would have grown to $18,776 - a 87.76% increase on the
initial investment. For comparison, look at how the Lehman Brothers
Municipal Bond Index - a market value-weighted index of
investment-grade municipal bonds with maturities of one year or more -
did over the same period. With dividends and capital gains, if any,
reinvested, the same $10,000 would have grown to $19,777 - a 97.77%
increase.
(checkmark)UNDERSTANDING
PERFORMANCE
How a fund did yesterday is
no guarantee of how it will do
tomorrow. Bond prices, for
example, generally move in
the opposite direction of
interest rates. In turn, the
share price, return and yield
of a fund that invests in bonds
will vary. That means if you
sell your shares during a
market downturn, you might
lose money. But if you can ride
out the market's ups and
downs, you may have a gain.
TOTAL RETURN COMPONENTS
YEARS ENDED NOVEMBER 30,
1999 1998 1997 1996 1995
Dividend returns 4.52% 4.92% 5.19% 5.29% 6.62%
Capital returns -5.64% 2.28% 1.69% 0.36% 12.79%
Total returns -1.12% 7.20% 6.88% 5.65% 19.41%
TOTAL RETURN COMPONENTS include both dividend returns and capital
returns. A dividend return reflects the actual dividends paid by the
fund. A capital return reflects both the amount paid by the fund to
shareholders as capital gain distributions and changes in the fund's
share price. Both returns assume the dividends or capital gains, if
any, paid by the fund are reinvested.
DIVIDENDS AND YIELD
PERIODS ENDED NOVEMBER 30, 1999 PAST 1 MONTH PAST 6 MONTHS PAST 1 YEAR
Dividends per share 4.34(cents) 26.32(cents) 52.63(cents)
Annualized dividend rate 4.84% 4.77% 4.68%
30-day annualized yield 4.71% - -
30-day annualized 7.71% - -
tax-equivalent yield
DIVIDENDS per share show the income paid by the fund for a set period
and do not reflect any tax reclassifications. If you annualize this
number, based on an average share price of $10.90 over the past one
month, $11.01 over the past six months and $11.25 over the past one
year, you can compare the fund's income over these three periods. The
30-day annualized YIELD is a standard formula for all bond funds based
on the yields of the bonds in the fund, averaged over the past 30
days. This figure shows you the yield characteristics of the fund's
investments at the end of the period. It also helps you compare funds
from different companies on an equal basis. The tax-equivalent yield
shows what you would have to earn on a taxable investment to equal the
fund's tax-free yield, if you're in the 38.88% combined effective 1999
federal and state income tax bracket, but does not reflect the payment
of the federal alternative minimum tax, if applicable.
SPARTAN CONNECTICUT MUNICIPAL INCOME FUND
FUND TALK: THE MANAGER'S OVERVIEW
MARKET RECAP
Although November saw the Federal
Reserve Board levy its third 0.25%
interest-rate hike of 1999, the
municipal bond market responded
with its best single-month
performance since January. This
improvement in investor sentiment -
perhaps anticipating that the Fed's
latest rate hike would be its last for
a while - was a key contributor to
the market's improved outlook.
However, for the 12-month period
ending November 30, 1999, munis
overall dwelled in negative territory,
as the Lehman Brothers Municipal
Bond Index - an index of
approximately 50,000
investment-grade, fixed-rate,
tax-exempt bonds - declined
1.07%. A big story throughout the
year was supply, or lack thereof.
Municipal issuance fell 16.9%
through the first three quarters of
1999 compared to the same period
in 1998. Unfortunately, demand
also was tepid as the strong U.S.
economy continued to sway
investors toward higher-yielding -
and higher-risk - alternatives. Late in
the period, though, as the Fed
sought to cool down the economy
and municipal yields became more
attractive, demand showed signs of
improving. In comparison to other
bonds, munis had mixed results.
Municipal performance soundly
trounced Treasuries, as the Lehman
Brothers Long-Term Government
Bond Index fell 7.52% during the
period. Meanwhile, the Lehman
Brothers Aggregate Bond Index - a
broad measure of the taxable
bond market - posted a
marginally negative return of
- -0.04%.
(photograph of George Fischer)
An interview with George Fischer, Portfolio Manager of Spartan
Connecticut Municipal Income Fund
Q. HOW DID THE FUND PERFORM, GEORGE?
A. Rising interest rates put significant pressure on bond prices,
although the fund performed better than its peers. For the 12-month
period that ended November 30, 1999, the fund had a total return of
- -1.12%. To get a sense of how the fund did relative to its
competitors, the Connecticut municipal debt funds average returned
- -2.70% for the same 12-month period, according to Lipper Inc.
Additionally, the Lehman Brothers Connecticut 4 Plus Year Enhanced
Municipal Bond Index - which tracks the types of securities in which
the fund invests - returned -0.83%.
Q. WHAT STRATEGIES HELPED THE FUND OUTPACE ITS PEERS?
A. The main reason was the fund's defensive posture. By defensive, I'm
referring to its stake in bonds that tended to hold their value better
under adverse market conditions. First, the fund's focus on high
quality securities - roughly two-thirds of the fund's net assets were
in bonds rated Aaa - was a big plus. Problems with scattered
lower-rated Baa securities prompted investors to demand higher yields,
causing many Baa-rated securities to underperform higher-rated
securities. The fund's emphasis on intermediate-maturity bonds also
was a plus. Because intermediates are less interest-rate sensitive
than longer-term bonds, they outperformed their longer-term
counterparts as interest rates rose.
Q. WHAT OTHER "DEFENSIVE" TYPES OF BONDS HELD UP RELATIVELY WELL
AGAINST THE MARKET'S DOWNDRAFT?
A. Some of the fund's best performers over the past year were premium
coupon bonds with interest rates of 5.5% to 6.0%. Premiums, as they
are known, carry coupons higher than prevailing interest rates and are
attractive for several reasons. First, they're more likely than
discount bonds - which carry interest rates below prevailing rates -
to be advance refunded, a refinancing-like process that generally is
positive for their prices. Second, premium bonds are somewhat
protected from the unfavorable tax treatment and price performance
that can hurt discount bonds when interest rates rise. Finally,
individual investors - who account for a significant portion of
municipal bond demand - tend to shy away from premium coupon bonds in
favor of par bonds - those that carry coupons at prevailing rates. As
a result, I'm often able to buy premiums at attractive prices relative
to comparably rated par bonds with similar maturities.
Q. WERE THERE ANY DISAPPOINTMENTS?
A. Aside from the market's overall downturn, I'd say the biggest
disappointments were the fund's limited holdings in longer-maturity
discount bonds. Their heightened interest-sensitivity, coupled with
the fact that they were discount bonds and, therefore, subject to the
unfavorable tax treatment I mentioned earlier, really hurt these
bonds.
Q. CUTBACKS IN FEDERALLY FUNDED HEALTH CARE PAYMENTS AND OTHER
NEGATIVE DEVELOPMENTS HURT THE HEALTH CARE SECTOR AS A WHOLE DURING
THE PAST YEAR. DID THAT DEVELOPMENT HAVE ANY IMPACT ON THE FUND?
A. Those factors hurt hospitals more than we realized and the fund's
relatively small stake in them was a modest drag on performance. It's
also important to note that the vast majority of the health care bonds
the fund owned were insured. While insurance doesn't protect the bonds
against price declines, it does guarantee that the fund will receive
scheduled interest and principal payments no matter what happens.
Q. GEORGE, WHAT'S YOUR OUTLOOK?
A. As it always is, the direction of interest rates will be the
primary factor that determines the municipal market's performance.
It's not clear at this point whether the Federal Reserve Board is
finished raising interest rates as it did in June, August and
November, or whether those rate hikes were just a preview of things to
come. But other factors - namely supply and demand - also will play a
role. If interest rates remain stable or move higher, I would expect
the supply of municipals to continue to taper off as issuers slow down
their refinancing and new issuance activity. We've also seen an
increase in the demand for municipal bonds as individual investors
look to lock in higher yields. To the extent that investors continue
on that course, the more municipals will likely benefit. While
longer-maturity and lower-quality bonds have performed poorly over the
past several months, there may be opportunities to pick up
attractively priced, higher-yielding securities. But I plan to be very
selective, keeping the bulk of the fund's investments in high-quality,
intermediate-maturity bonds that I feel offer the best combination of
reward and risk.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO
MANAGER ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON
THE COVER AND DO NOT NECESSARILY REPRESENT THE VIEWS OF FIDELITY OR
ANY OTHER PERSON IN THE FIDELITY ORGANIZATION. ANY SUCH VIEWS ARE
SUBJECT TO CHANGE AT ANY TIME BASED UPON MARKET OR OTHER CONDITIONS
AND FIDELITY DISCLAIMS ANY RESPONSIBILITY TO UPDATE SUCH VIEWS. THESE
VIEWS MAY NOT BE RELIED ON AS INVESTMENT ADVICE AND, BECAUSE
INVESTMENT DECISIONS FOR A FIDELITY FUND ARE BASED ON NUMEROUS
FACTORS, MAY NOT BE RELIED ON AS AN INDICATION OF TRADING INTENT ON
BEHALF OF ANY FIDELITY FUND.
(checkmark)FUND FACTS
GOAL: to provide high-current
tax-free income for
Connecticut residents
FUND NUMBER: 407
TRADING SYMBOL: FICNX
START DATE: October 29,
1987
SIZE: as of November 30,
1999, more than $346 million
MANAGER: George Fischer,
since 1996; manager, various
Fidelity and Spartan municipal
income funds; joined Fidelity
in 1989
GEORGE FISCHER ON CHOOSING
INVESTMENTS FOR THE FUND:
"When selecting individual bonds
for inclusion in the fund, credit
research is always the starting
point. Using a very rigorous research
process, I - with the help of
Fidelity's credit research team -
look for investment-grade bonds
from issuers that have exhibited
fiscal prudence and are
well-managed. After completing
careful credit research, I then
consider structural characteristics,
such as maturity, call features,
coupons and others. Because so
much of the municipal market is
insured, it's often challenging to
add value through credit research.
So I look for opportunities to take
advantage of pricing anomalies
that creep up due to a fund's
structural characteristics."
(solid bullet) General obligation bonds
(GOs) were the fund's largest sector
concentration throughout the past
year, making up 35.3% of the fund's
net assets at the end of the
period. A GO is backed by the full
faith and credit - which includes
the taxing power - of a city,
county, state or other issuer. GOs are
repaid through general revenues -
including individual and
corporate taxes - collected by
the issuer.
SPARTAN CONNECTICUT MUNICIPAL INCOME FUND
INVESTMENT CHANGES
<TABLE>
<CAPTION>
<S> <C> <C>
TOP FIVE SECTORS AS OF
NOVEMBER 30, 1999
% OF FUND'S NET ASSETS % OF FUND'S NET ASSETS 6
MONTHS AGO
General Obligations 35.3 37.2
Special Tax 16.1 12.3
Health Care 14.0 13.1
Escrowed/Pre-Refunded 8.3 9.3
Water & Sewer 7.3 8.1
AVERAGE YEARS TO MATURITY AS
OF NOVEMBER 30, 1999
6 MONTHS AGO
Years 11.9 11.9
</TABLE>
AVERAGE YEARS TO MATURITY IS BASED ON THE AVERAGE TIME REMAINING UNTIL
PRINCIPAL PAYMENTS ARE EXPECTED FROM EACH OF THE FUND'S BONDS,
WEIGHTED BY DOLLAR AMOUNT.
DURATION AS OF NOVEMBER 30,
1999
6 MONTHS AGO
Years 6.8 6.5
DURATION SHOWS HOW MUCH A BOND FUND'S PRICE FLUCTUATES WITH CHANGES IN
COMPARABLE INTEREST RATES. IF RATES RISE 1%, FOR EXAMPLE, A FUND WITH
A FIVE-YEAR DURATION IS LIKELY TO LOSE ABOUT 5% OF ITS VALUE. OTHER
FACTORS ALSO CAN INFLUENCE A BOND FUND'S PERFORMANCE AND SHARE PRICE.
ACCORDINGLY, A BOND FUND'S ACTUAL PERFORMANCE MAY DIFFER FROM THIS
EXAMPLE.
QUALITY DIVERSIFICATION
AS OF NOVEMBER 30, 1999
Aaa 65.6%
Aa, A 25.5%
Baa 7.2%
Short-term
Investments 1.7%
Row: 1, Col: 1, Value: 65.59999999999999
Row: 1, Col: 2, Value: 38.5
Row: 1, Col: 3, Value: 25.5
Row: 1, Col: 4, Value: 0.0
Row: 1, Col: 5, Value: 7.2
Row: 1, Col: 6, Value: 1.7
AS OF MAY 31, 1999
Aaa 64.6%
Aa, A 27.9%
Baa 7.5%
Short-term
Investments 0.0%
Row: 1, Col: 1, Value: 64.59999999999999
Row: 1, Col: 2, Value: 39.4
Row: 1, Col: 3, Value: 27.9
Row: 1, Col: 4, Value: 0.6000000000000001
Row: 1, Col: 5, Value: 7.5
Row: 1, Col: 6, Value: 0.0
WHERE MOODY'S RATINGS ARE NOT AVAILABLE, WE HAVE USED S&P(registered
trademark) RATINGS. AMOUNTS SHOWN ARE AS A PERCENTAGE OF THE FUND'S
INVESTMENTS.
PRIOR TO THIS REPORT, CERTAIN INFORMATION RELATED TO PORTFOLIO
HOLDINGS WAS STATED AS A PERCENTAGE OF THE FUND'S INVESTMENTS.
SPARTAN CONNECTICUT MUNICIPAL INCOME FUND
INVESTMENTS NOVEMBER 30, 1999
Showing Percentage of Net Assets
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
MUNICIPAL BONDS - 98.5%
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT VALUE (NOTE 1)
CONNECTICUT - 90.9%
Branford Gen. Oblig.:
7% 6/15/08 (FGIC Insured) Aaa $ 500,000 $ 567,765
7% 6/15/09 (FGIC Insured) Aaa 500,000 572,010
Bridgeport Gen. Oblig.:
Rfdg. Series A:
6% 9/1/03 (AMBAC Insured) Aaa 4,475,000 4,708,327
6% 9/1/05 (AMBAC Insured) Aaa 4,000,000 4,260,000
6.5% 9/1/07 (AMBAC Insured) Aaa 2,290,000 2,528,458
8.75% 8/15/05 (FGIC Insured) Aaa 670,000 802,653
Connecticut Clean Wtr. Fund
Rev.:
Rfdg. 5.25% 7/15/11 Aa1 3,000,000 3,009,030
5.75% 3/1/07 Aaa 2,615,000 2,763,663
6% 10/1/12 (d) Aaa 6,000,000 6,391,440
6.8% 7/1/05 Aaa 1,000,000 1,046,630
7% 1/1/11 Aaa 2,500,000 2,619,075
Connecticut Dev. Auth. Rev.
Series A:
4.75% 11/15/13 A1 1,525,000 1,415,459
6% 11/15/07 A1 1,525,000 1,630,332
6% 11/15/08 A1 1,525,000 1,632,009
6% 11/15/09 A1 1,525,000 1,621,761
Connecticut Gen. Oblig.:
(Cap. Appreciation) (College
Savings Plan Proj.):
Series A, 0% 5/15/07 Aa3 2,250,000 1,555,718
Series B:
0% 11/1/06 Aa3 2,800,000 2,001,664
0% 11/1/09 Aa3 7,000,000 4,216,100
Rfdg.:
Series A, 5.25% 3/15/12 Aa3 1,000,000 994,190
Series E, 6% 3/15/12 Aa3 1,400,000 1,489,684
Series A:
5.25% 3/15/11 Aa3 3,000,000 3,010,200
6% 3/1/06 Aa3 2,700,000 2,876,931
Series B:
5.5% 3/15/08 Aa3 5,000,000 5,178,350
5.5% 11/1/17 Aa3 1,500,000 1,466,295
5.875% 11/1/16 Aa3 6,050,000 6,169,488
6% 10/1/05 Aa3 6,430,000 6,863,575
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT VALUE (NOTE 1)
CONNECTICUT - CONTINUED
Connecticut Health & Edl.
Facilities Auth. Rev.:
(Bristol Hosp. Proj.):
Series A 7% 7/1/09 (MBIA Aaa $ 1,750,000 $ 1,807,383
Insured)
Series A 7% 7/1/20 (MBIA Aaa 4,180,000 4,312,673
Insured)
(Connecticut College Proj.) Aaa 1,200,000 1,266,216
Series B, 6.625% 7/1/11
(MBIA Insured) (Pre-Refunded
to 7/1/01 @ 102) (c)
(Danbury Hosp. Proj.) Series Aaa 4,695,000 4,501,566
G, 5.625% 7/1/25 (AMBAC
Insured)
(Greenwich Hosp. Proj.) Aaa 5,400,000 5,285,466
Series A, 5.8% 7/1/26 (MBIA
Insured)
(Hebrew Home & Hosp. Proj.)
Series B:
5.15% 8/1/28 AAA 2,500,000 2,189,075
5.2% 8/1/38 AAA 4,190,000 3,643,373
(Kent School Proj.) Series B:
5.1% 7/1/07 (MBIA Insured) Aaa 265,000 267,979
5.25% 7/1/08 (MBIA Insured) Aaa 305,000 309,944
5.375% 7/1/09 (MBIA Insured) Aaa 345,000 351,976
5.4% 7/1/10 (MBIA Insured) Aaa 685,000 696,035
(Loomis Chaffee School Proj.) Aaa 1,430,000 1,340,940
Series C, 5.5% 7/1/26 (MBIA
Insured)
(Lutheran Gen. Health Care Aaa 3,195,000 3,683,132
Sys. Proj.) 7.375% 7/1/19
(Escrowed to Maturity) (c)
(Masonicar Proj.) Series A, Aaa 2,400,000 2,133,576
5% 7/1/20 (AMBAC Insured)
(New Britain Memorial Hosp. AAA 6,500,000 7,147,790
Proj.) Series A, 7.75%
7/1/22 (Pre-Refunded to
7/1/02 @ 102) (c)
(Quinnipiac College Proj.) BBB- 1,940,000 2,019,094
Series C, 7.75% 7/1/20
(Pre-Refunded to 7/1/00 @
102) (c)
(Sacred Heart Univ. Proj.):
Series A, 6.85% 7/1/22, LOC Baa3 1,000,000 1,075,400
Fleet Nat'l. Bank,
Providence (Pre-Refunded to
7/1/02 @ 102) (c)
Series B, 5.5% 7/1/09 Baa3 1,500,000 1,570,515
(Pre-Refunded to 7/1/03 @
102) (c)
Series C:
6% 7/1/06 (Escrowed to Baa3 190,000 203,053
Maturity) (c)
6.5% 7/1/16 (Pre-Refunded to Baa3 3,020,000 3,338,097
7/1/06 @ 102) (c)
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT VALUE (NOTE 1)
CONNECTICUT - CONTINUED
Connecticut Health & Edl.
Facilities Auth. Rev.: -
continued
(Sharon Health Care, Inc.
Proj.) Series A:
8.75% 7/1/06 (Pre-Refunded to AAA $ 450,000 $ 493,488
7/1/01 @ 103) (c)
9% 7/1/13 (Pre-Refunded to AAA 1,300,000 1,429,480
7/1/01 @ 103) (c)
9.2% 7/1/21 (Pre-Refunded to AAA 1,500,000 1,653,930
7/1/01 @ 103) (c)
(Stamford Hosp. Issue Proj.) Aaa 4,895,000 4,309,264
Series G, 5% 7/1/24 (MBIA
Insured)
(Veterans Memorial Med. Ctr.
Proj.) Series A:
5.5% 7/1/26 (MBIA Insured) Aaa 3,270,000 3,066,344
6.25% 7/1/05 (MBIA Insured) Aaa 2,265,000 2,426,834
(Yale Univ. Proj.) 5.929% Aaa 10,000,000 9,804,700
6/10/30
Rfdg.:
(Choate Rosemary Hall Proj.) Aaa 2,500,000 2,167,725
Issue B, 5% 7/1/27 (MBIA
Insured)
(Hosp. for Spl. Care Issue
Proj.) Series B:
5.375% 7/1/17 Baa2 2,700,000 2,378,403
5.5% 7/1/27 Baa2 2,500,000 2,138,350
(Quinnipiac College Proj.)
Series D:
6% 7/1/13 BBB- 1,300,000 1,290,718
6% 7/1/13 (Pre-Refunded to BBB- 1,700,000 1,807,678
7/1/03 @ 102) (c)
6% 7/1/23 BBB- 940,000 914,460
6% 7/1/23 (Pre-Refunded to BBB- 1,400,000 1,488,676
7/1/03 @ 102) (c)
(St. Raphael Hosp. Proj.)
Series H:
5.25% 7/1/14 (AMBAC Insured) Aaa 4,400,000 4,284,984
6.5% 7/1/11 (AMBAC Insured) Aaa 2,780,000 3,085,216
6.5% 7/1/13 (AMBAC Insured) Aaa 3,125,000 3,458,250
(Taft School Issue Proj.) Aaa 1,000,000 912,290
Series D, 5% 7/1/17 (MBIA
Insured)
Connecticut Higher Ed.
Supplemental Ln. Auth. Rev.:
(Family Ed. Ln. Prog.) Series
A:
5.5% 11/15/09 (b) A1 1,000,000 1,004,810
7.2% 11/15/10 (b) A 730,000 753,652
Series A:
7.375% 11/15/05 (b) A1 430,000 435,375
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT VALUE (NOTE 1)
CONNECTICUT - CONTINUED
Connecticut Higher Ed.
Supplemental Ln. Auth. Rev.:
- - continued
7.5% 11/15/10 (b) A1 $ 1,470,000 $ 1,488,375
Connecticut Hsg. Fin. Auth.
(Hsg. Mtg. Fin. Prog.):
Series A, 6.45% 5/15/22 (b) Aa2 2,060,000 2,081,445
Series B, 6.2% 5/15/12 Aa2 2,500,000 2,573,925
Series E, 6.2% 5/15/14 Aa2 1,000,000 1,028,140
Connecticut Muni. Elec.
Energy Coop. Pwr. Supply
Sys. Rev. Rfdg. Series A:
6% 1/1/04 (MBIA Insured) Aaa 1,790,000 1,879,894
6% 1/1/05 (MBIA Insured) Aaa 1,880,000 1,986,840
6% 1/1/06 (MBIA Insured) Aaa 2,000,000 2,122,640
Connecticut Resources
Recovery Auth. Rfdg.
(Mid-Connecticut Sys. Proj.)
Series A:
5.25% 11/15/08 (MBIA Insured) Aaa 4,000,000 4,060,560
5.375% 11/15/10 (MBIA Insured) Aaa 1,000,000 1,011,830
5.5% 11/15/11 (MBIA Insured) Aaa 2,500,000 2,539,200
Connecticut Resources
Recovery Auth. Resources
Recovery Rev. Rfdg.:
(Bridgeport Resco LP Proj.) Aaa 3,000,000 3,059,190
5.375% 1/1/06 (MBIA Insured)
(Fuel Co. Proj.) Series A, Aaa 2,000,000 2,034,260
5.5% 11/15/09 (MBIA Insured)
(b)
Connecticut Spl. Tax Oblig.
Rev.:
(Cap. Appreciation) (Trans. A1 3,500,000 2,268,035
Infrastructure Proj.) Series
B, 0% 6/1/08
(Trans. Infrastructure Proj.):
Series A:
5.5% 11/1/06 (FSA Insured) Aaa 1,925,000 2,000,961
7.125% 6/1/10 A1 3,550,000 4,074,300
Series B:
5.4% 10/1/10 (MBIA Insured) Aaa 2,545,000 2,589,919
5.5% 11/1/10 (FSA Insured) Aaa 5,000,000 5,155,050
6.125% 9/1/12 A1 5,000,000 5,355,900
6.15% 9/1/09 A1 1,500,000 1,615,365
6.5% 10/1/07 A1 2,250,000 2,475,653
6.5% 10/1/10 A1 3,250,000 3,600,643
6.5% 10/1/12 A1 7,100,000 7,911,388
Rfdg. (Trans. Infrastructure
Proj.):
Series A, 5.125% 9/1/05 A1 2,500,000 2,545,850
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT VALUE (NOTE 1)
CONNECTICUT - CONTINUED
Connecticut Spl. Tax Oblig.
Rev.: - continued
Series B, 5.5% 11/1/07 (FSA Aaa $ 10,000,000 $ 10,389,900
Insured)
Eastern Connecticut Resources BBB 1,000,000 949,270
Recovery Auth. Solid Waste
Rev. (Wheelabrator Lisbon
Proj.) Series A, 5% 1/1/04
(b)
Meriden Gen. Oblig.:
6.25% 8/1/05 (FGIC Insured) Aaa 2,000,000 2,152,960
6.25% 8/1/06 (FGIC Insured) Aaa 2,000,000 2,166,940
7% 10/1/07 (MBIA Insured) Aaa 500,000 566,915
Naugatuck Gen. Oblig.:
6.9% 6/15/07 (FGIC Insured) Aaa 485,000 546,503
7.25% 9/1/04 (MBIA Insured) Aaa 215,000 239,233
7.4% 9/1/07 (MBIA Insured) Aaa 370,000 428,516
7.4% 9/1/08 (MBIA Insured) Aaa 370,000 431,494
New Britain Gen. Oblig.:
Rfdg. 6% 2/1/12 (MBIA Insured) Aaa 400,000 426,180
Series B, 6% 3/1/12 (MBIA Aaa 2,000,000 2,131,540
Insured)
6% 4/15/06 (AMBAC Insured) Aaa 1,615,000 1,722,672
6% 4/15/07 (AMBAC Insured) Aaa 1,615,000 1,726,774
7% 4/1/07 (MBIA Insured) Aaa 580,000 653,451
7% 4/1/08 (MBIA Insured) Aaa 580,000 657,024
New Haven Gen. Oblig.:
Rfdg. Series A:
5% 8/1/09 (FGIC Insured) Aaa 1,525,000 1,514,920
6% 8/1/05 (FGIC Insured) Aaa 3,410,000 3,628,820
Series A, 7.4% 3/1/12 Baa1 1,000,000 1,082,390
(Pre-Refunded to 3/1/02 @
102) (c)
6% 2/15/05 (FGIC Insured) Aaa 1,650,000 1,748,093
7% 2/15/03 (FGIC Insured) Aaa 1,000,000 1,073,030
7% 2/15/04 (FGIC Insured) Aaa 1,150,000 1,255,076
7% 2/15/05 (FGIC Insured) Aaa 1,250,000 1,378,375
8.25% 8/15/01 A3 1,270,000 1,297,496
Newtown Gen. Oblig.:
6% 6/15/05 (MBIA Insured) Aaa 1,700,000 1,806,981
6% 6/15/06 (MBIA Insured) Aaa 1,700,000 1,816,008
North Thompsonville Fire
District #10:
6.75% 6/1/07 (MBIA Insured) Aaa 180,000 200,453
6.75% 6/1/08 (MBIA Insured) Aaa 190,000 212,965
6.75% 6/1/09 (MBIA Insured) Aaa 200,000 224,984
6.75% 6/1/10 (MBIA Insured) Aaa 215,000 243,098
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT VALUE (NOTE 1)
CONNECTICUT - CONTINUED
North Thompsonville Fire
District #10: - continued
6.75% 6/1/11 (MBIA Insured) Aaa $ 230,000 $ 261,551
South Central Connecticut
Reg'l. Wtr. Auth. Wtr. Sys.
Rev. Series 11:
5.625% 8/1/05 (FGIC Insured) Aaa 4,000,000 4,166,680
5.75% 8/1/12 (FGIC Insured) Aaa 5,000,000 5,141,550
Stamford Gen. Oblig.:
Rfdg.:
5.25% 7/15/10 Aaa 5,000,000 5,069,600
5.25% 7/15/12 Aaa 1,580,000 1,577,930
6.25% 2/15/03 Aaa 1,725,000 1,815,994
6.25% 2/15/04 Aaa 1,725,000 1,833,675
6.25% 2/15/05 Aaa 535,000 573,932
6.6% 1/15/07 Aaa 295,000 325,931
6.6% 1/15/08 Aaa 1,480,000 1,641,734
6.6% 1/15/09 Aaa 1,000,000 1,116,240
Stamford Hsg. Auth. A3 6,000,000 5,632,500
Multifamily Rev. Rfdg. Bonds
(Fairfield Apts. Proj.)
4.75%, tender 12/1/08 (b)
Stratford Gen. Oblig. 7% Aaa 500,000 567,765
6/15/08 (FGIC Insured)
West Hartford Gen. Oblig.:
5% 7/15/11 Aaa 2,000,000 1,978,300
6.5% 7/15/05 Aaa 2,000,000 2,180,480
6.5% 7/15/06 Aaa 2,000,000 2,196,480
West Haven Gen. Oblig. 6.7% Aaa 710,000 768,227
2/15/04 (MBIA Insured)
Wolcott Gen. Oblig.:
7% 6/15/09 (FGIC Insured) Aaa 445,000 509,089
7% 6/15/10 (FGIC Insured) Aaa 440,000 505,366
Woodstock Spl. Oblig. Rev. Aaa 725,000 750,904
(Woodstock Academy Proj.) 7%
3/1/08 (AMBAC Insured)
314,584,069
PUERTO RICO - 7.6%
Puerto Rico Commonwealth Hwy. Baa1 1,750,000 1,847,965
& Trans. Auth. Hwy. Rev.
Rfdg. Series V, 6.625% 7/1/12
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT VALUE (NOTE 1)
PUERTO RICO - CONTINUED
Puerto Rico Commonwealth
Infrastructure Fing. Auth.
Spl. Tax Rev.:
Rfdg. Series A, 5.25% 7/1/10 Aaa $ 11,065,000 $ 11,275,784
(AMBAC Insured)
Series A, 5% 7/1/28 (AMBAC Aaa 6,500,000 5,737,095
Insured)
Puerto Rico Commonwealth Pub. Baa1 2,500,000 2,506,825
Impt. Rev. 5.25% 7/1/10
Puerto Rico Elec. Pwr. Auth. Aaa 3,500,000 3,465,805
Pwr. Rev. Series AA, 5.375%
7/1/14 (MBIA Insured)
Puerto Rico Ind. Med. & Aa3 1,285,000 1,367,009
Envir. Poll. Cont.
Facilities Fing. Auth. Rev.
(Motorola, Inc. Proj.)
Series A, 6.75% 1/1/14
26,200,483
TOTAL INVESTMENT PORTFOLIO - 340,784,552
98.5%
(Cost $336,463,863)
NET OTHER ASSETS - 1.5% 5,328,360
NET ASSETS - 100% $ 346,112,912
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
FUTURES CONTRACTS
EXPIRATION DATE UNDERLYING FACE AMOUNT AT VALUE UNREALIZED GAIN/LOSS
PURCHASED
39 Bond Buyer Municipal Bond Dec. 1999 $ 4,290,000 $ (200,859)
Index Contracts
</TABLE>
The face value of futures purchased as a percentage of net assets -
1.2%
LEGEND
(a) S&P credit ratings are used in the absence of a rating by Moody's
Investors Service, Inc.
(b) Private activity obligations whose interest is subject to the
federal alternative minimum tax for individuals.
(c) Security collateralized by an amount sufficient to pay interest
and principal.
(d) Security or a portion of the security was pledged to cover margin
requirements for futures contracts. At the period end, the value of
securities pledged amounted to $484,684.
OTHER INFORMATION
The composition of long-term debt holdings as a percentage of total
value of investments in securities, is as follows (ratings are
unaudited):
MOODY'S RATINGS S&P RATINGS
Aaa, Aa, A 86.3% AAA, AA, A 89.0%
Baa 4.7% BBB 5.7%
Ba 0.0% BB 0.0%
B 0.0% B 0.0%
Caa 0.0% CCC 0.0%
Ca, C 0.0% CC, C 0.0%
CC, C 0.0%
The distribution of municipal securities by revenue source, as a
percentage of net assets, is as follows:
General Obligations 35.3%
Special Tax 16.1%
Health Care 14.0%
Escrowed/Pre-Refunded 8.3%
Water & Sewer 7.3%
Education 6.7%
Others* (individually less 12.3%
than 5%)
100.0%
* Includes net other assets
INCOME TAX INFORMATION
At November 30, 1999, the aggregate cost of investment securities for
income tax purposes was $336,463,863. Net unrealized appreciation
aggregated $4,320,689, of which $9,564,860 related to appreciated
investment securities and $5,244,171 related to depreciated investment
securities.
The fund hereby designates approximately $1,415,000 as a capital gain
dividend.
During the fiscal year ended 1999, 100% of the fund's income dividends
was free from federal income tax, and 4.54% of the fund's income
dividends was subject to the federal alternative minimum tax
(unaudited).
The fund hereby designates 100% of the long-term capital gain
dividends distributed during the fiscal year as 20%-rate capital gain
dividends.
The fund will notify shareholders in January 2000 of amounts for use
in preparing 1999 income tax returns.
SPARTAN CONNECTICUT MUNICIPAL INCOME FUND
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
NOVEMBER 30, 1999
ASSETS
Investment in securities, at $ 340,784,552
value (cost $336,463,863) -
See accompanying schedule
Cash 1,171,776
Receivable for fund shares 3,370
sold
Interest receivable 5,525,462
Receivable for daily 14,625
variation on futures
contracts
TOTAL ASSETS 347,499,785
LIABILITIES
Payable for fund shares $ 801,990
redeemed
Distributions payable 442,094
Accrued management fee 138,774
Other payables and accrued 4,015
expenses
TOTAL LIABILITIES 1,386,873
NET ASSETS $ 346,112,912
Net Assets consist of:
Paid in capital $ 342,669,671
Accumulated undistributed net (676,589)
realized gain (loss) on
investments
Net unrealized appreciation 4,119,830
(depreciation) on investments
NET ASSETS, for 31,815,941 $ 346,112,912
shares outstanding
NET ASSET VALUE, offering $10.88
price and redemption price
per share ($346,112,912
(divided by) 31,815,941
shares)
STATEMENT OF OPERATIONS
YEAR ENDED NOVEMBER 30, 1999
INTEREST INCOME $ 18,968,912
EXPENSES
Management fee $ 2,010,207
Non-interested trustees' 1,031
compensation
Total expenses before 2,011,238
reductions
Expense reductions (203,431) 1,807,807
NET INTEREST INCOME 17,161,105
REALIZED AND UNREALIZED GAIN
(LOSS)
Net realized gain (loss) on:
Investment securities 1,074,088
Futures contracts (132,636) 941,452
Change in net unrealized
appreciation (depreciation)
on:
Investment securities (21,954,407)
Futures contracts (200,859) (22,155,266)
NET GAIN (LOSS) (21,213,814)
NET INCREASE (DECREASE) IN $ (4,052,709)
NET ASSETS RESULTING FROM
OPERATIONS
<TABLE>
<CAPTION>
<S> <C> <C>
STATEMENT OF CHANGES IN NET ASSETS
YEAR ENDED NOVEMBER 30, 1999 YEAR ENDED NOVEMBER 30, 1998
INCREASE (DECREASE) IN NET
ASSETS
Operations Net interest income $ 17,161,105 $ 16,780,200
Net realized gain (loss) 941,452 2,052,603
Change in net unrealized (22,155,266) 5,719,448
appreciation (depreciation)
NET INCREASE (DECREASE) IN (4,052,709) 24,552,251
NET ASSETS RESULTING FROM
OPERATIONS
Distributions to shareholders (17,161,105) (16,780,200)
From net interest income
From net realized gain (941,452) (2,984,295)
In excess of net realized (671,785) -
gain
TOTAL DISTRIBUTIONS (18,774,342) (19,764,495)
Share transactions Net 54,402,897 61,455,356
proceeds from sales of shares
Reinvestment of distributions 13,953,708 15,240,662
Cost of shares redeemed (72,872,431) (49,698,375)
NET INCREASE (DECREASE) IN (4,515,826) 26,997,643
NET ASSETS RESULTING FROM
SHARE TRANSACTIONS
Redemption fees 22,778 14,784
TOTAL INCREASE (DECREASE) (27,320,099) 31,800,183
IN NET ASSETS
NET ASSETS
Beginning of period 373,433,011 341,632,828
End of period $ 346,112,912 $ 373,433,011
OTHER INFORMATION
Shares
Sold 4,827,219 5,348,277
Issued in reinvestment of 1,239,956 1,327,375
distributions
Redeemed (6,503,445) (4,331,105)
Net increase (decrease) (436,270) 2,344,547
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
FINANCIAL HIGHLIGHTS
YEARS ENDED NOVEMBER 30, 1999 1998 1997 1996 1995
SELECTED PER-SHARE DATA
Net asset value, beginning $ 11.580 $ 11.420 $ 11.240 $ 11.200 $ 9.960
of period
Income from Investment .526 .541 .559 .569 .617
Operations Net interest
income
Net realized and unrealized (.651) .260 .190 .039 1.270
gain (loss)
Total from investment (.125) .801 .749 .608 1.887
operations
Less Distributions
From net interest income (.526) (.541) (.559) (.569) (.617)
From net realized gain (.029) (.100) (.010) - (.020)
In excess of net realized gain (.021) - - - (.010)
Total distributions (.576) (.641) (.569) (.569) (.647)
Redemption fees added to paid .001 .000 .000 .001 .000
in capital
Net asset value, end of period $ 10.880 $ 11.580 $ 11.420 $ 11.240 $ 11.200
TOTAL RETURN A (1.12)% 7.20% 6.88% 5.65% 19.41%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 346,113 $ 373,433 $ 341,633 $ 334,620 $ 358,849
(000 omitted)
Ratio of expenses to average .55% .55% .55% .55% .55%
net assets
Ratio of expenses to average .49% B .54% B .55% .52% B .55%
net assets after expense
reductions
Ratio of net interest income 4.69% 4.71% 4.98% 5.15% 5.73%
to average net assets
Portfolio turnover rate 23% 8% 12% 30% 39%
</TABLE>
A THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT
BEEN REDUCED DURING THE PERIODS SHOWN.
B FMR OR THE FUND HAS ENTERED INTO VARYING ARRANGEMENTS WITH THIRD
PARTIES WHO EITHER PAID OR REDUCED A PORTION OF THE FUND'S EXPENSES.
SPARTAN CONNECTICUT MUNICIPAL MONEY MARKET FUND
PERFORMANCE: THE BOTTOM LINE
To evaluate a money market fund's historical performance, you can look
at either total return or yield. Total return reflects the change in
value of an investment, assuming reinvestment of the fund's dividend
income but does not include the effect of the fund's $5 account
closeout fee on an average-sized account. Yield measures the income
paid by a fund. Since a money market fund tries to maintain a $1 share
price, yield is an important measure of performance. If Fidelity had
not reimbursed certain fund expenses, the life of fund total returns
would have been lower.
CUMULATIVE TOTAL RETURNS
PERIODS ENDED NOVEMBER 30, 1999 PAST 1 YEAR PAST 5 YEARS LIFE OF FUND
SPARTAN CT MUNICIPAL MONEY 2.70% 16.34% 29.08%
MARKET
Connecticut Tax-Free Money 2.43% 15.01% n/a
Market Funds Average
CUMULATIVE TOTAL RETURNS show the fund's performance in percentage
terms over a set period - in this case, one year, five years or since
the fund started on March 4, 1991. For example, if you had invested
$1,000 in a fund that had a 5% return over the past year, the value of
your investment would be $1,050. To measure how the fund's performance
stacked up against its peers, you can compare it to the Connecticut
tax-free money market funds average, which reflects the performance of
tax-free money market funds with similar objectives tracked by IBC
Financial Data, Inc. The past one year average represents a peer group
of 10 money market funds.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED NOVEMBER 30, 1999 PAST 1 YEAR PAST 5 YEARS LIFE OF FUND
SPARTAN CT MUNICIPAL MONEY 2.70% 3.07% 2.96%
MARKET
Connecticut Tax-Free Money 2.43% 2.83% n/a
Market Funds Average
AVERAGE ANNUAL TOTAL RETURNS take the fund's cumulative return and
show you what would have happened if the fund had performed at a
constant rate each year.
YIELDS
11/29/99 8/30/99 5/31/99 3/1/99 11/30/98
Spartan Connecticut 3.15% 2.69% 2.69% 2.36% 2.71%
Municipal Money Market Fund
Connecticut Tax-Free Money 2.88% 2.45% 2.41% 2.15% 2.44%
Market Funds Average
Spartan Connecticut 5.14% 4.40% 4.39% 3.86% 4.44%
Municipal Money Market
Fund - Tax-equivalent
Portion of fund's income 19.18% 24.29% 19.33% 18.84% 20.47%
subject to state taxes
YIELD refers to the income paid by the fund over a given period.
Yields for money market funds are usually for seven-day periods,
expressed as annual percentage rates. A yield that assumes income
earned is reinvested or compounded is called an effective yield. The
table above shows the fund's current seven-day yield at quarterly
intervals over the past year. You can compare these yields to the
Connecticut tax-free money market funds average as tracked by IBC
Financial Data, Inc. or you can look at the fund's tax-equivalent
yield, which is based on a combined effective 1999 federal and state
income tax rate of 38.88%. The fund's yields mentioned above reflect
that a portion of the fund's income was subject to state taxes. A
portion of the fund's income may be subject to the federal alternative
minimum tax.
A MONEY MARKET FUND'S TOTAL RETURNS AND YIELDS WILL VARY, AND REFLECT
PAST RESULTS RATHER THAN PREDICT FUTURE PERFORMANCE.
(checkmark)COMPARING
PERFORMANCE
Yields on tax-free investments
are usually lower than yields
on taxable investments.
However, a straight
comparison between the two
may be misleading because it
ignores the way taxes reduce
taxable returns. Tax-equivalent
yield - the yield you'd have to
earn on a similar taxable
investment to match the tax-free
yield - makes the comparison
more meaningful. Keep in mind
that the U.S. government
neither insures nor
guarantees a money market
fund. In fact, there is no
assurance that a money market
fund will maintain a $1 share
price.
SPARTAN CONNECTICUT MUNICIPAL MONEY MARKET FUND
FUND TALK: THE MANAGER'S OVERVIEW
(photograph of Scott Orr)
An interview with Scott Orr, Portfolio Manager of Spartan Connecticut
Municipal Money Market Fund
Q. SCOTT, WHAT WAS THE INVESTMENT ENVIRONMENT LIKE OVER THE 12 MONTHS
THAT ENDED NOVEMBER 30, 1999?
A. At the beginning of the period, a global economic crisis continued
to cast a shadow over the market. There were many questions about the
pace of U.S. economic growth and the direction of interest rates.
Early in 1999, however, any doubts were put to rest, as both growth
and employment strengthened. In addition, data began to indicate that
inflation might not be as well-behaved as it had been in the recent
past. Faced with that backdrop, market observers began to feel that
the Federal Reserve Board would raise short-term interest rates to
slow growth and head off inflation. Through the rest of the period,
economic growth remained solid and unemployment stayed at historically
low levels. Such a tight labor market often leads to inflation, as
employers are forced to raise salaries in order to attract or retain
workers, passing on the additional cost to the consumer. The Fed
indicated that improvements in worker productivity had helped keep
inflation at bay. Nevertheless, with constant, broad-based economic
strength and continually tight labor markets, the Fed felt compelled
to take back all three of the rate cuts it had implemented in the fall
of 1998. It did so with a series of three 0.25 percentage point rate
hikes in June, August and November, raising the rate banks charge each
other for overnight loans - known as the fed funds rate - from 4.75%
at the beginning of the period to 5.50% by the end of November 1999.
Q. WHAT WAS YOUR STRATEGY WITH THE FUND?
A. From December 1998 through the end of May 1999, I kept the fund's
average maturity relatively short because yields on long-term
securities were unattractive. At the end of May, new supply helped
push long-term yields higher, so I took advantage of opportunities
among one-year, fixed-rate notes. Nevertheless, by mid-June the fund's
average maturity was still slightly shorter than its peers because I
wanted to wait until long-term securities adequately reflected my
expectations for higher rates. Market rates began to price in future
Fed rate hikes in June and July, at the same time that new supply hit
the market, boosting yields on one-year notes. I took advantage of the
opportunity to extend the fund's maturity. It remained relatively
stable until the end of November, when I increased it further by
buying securities that I felt would perform well over the next year.
Q. WHY DID THE FUND INVEST OUT-OF-STATE?
A. The fund pursued this strategy - within the limits of the fund's
investment policies - in order to provide shareholders with a higher
tax-adjusted yield. In certain cases, yields on Connecticut
obligations were sufficiently low so that comparable out-of-state
obligations provided a higher tax-adjusted yield even though they are
subject to Connecticut tax. Even though more of shareholders' income
for the fund's 1999 fiscal year will be taxable than if I had
purchased exclusively Connecticut obligations, shareholders may be
able to retain more of a fund's dividends, after taxes are taken into
account. The fund may also invest out-of-state if there is a limited
supply of Connecticut obligations.
Q. HOW DID THE FUND PERFORM?
A. The fund's seven-day yield on November 30, 1999, was 3.15%,
compared to 2.71% 12 months ago. The more recent seven-day yield was
the equivalent of a 5.16% taxable rate of return for Connecticut
investors in the 38.88% combined state and federal income tax bracket.
The fund's yields reflect that a portion of the fund's income was
subject to state taxes. Through November 30, 1999, the fund's 12-month
total return was 2.70%, compared to 2.43% for the Connecticut tax-free
money market funds average, according to IBC Financial Data, Inc.
Q. WHAT IS YOUR OUTLOOK?
A. Before the Fed's most recent rate hike, market sentiment reflected
the belief that the Fed would sit back and wait to see what happens
after bringing rates back to their 1998 levels. However, judging by
its reaction to the latest Fed move, the market doesn't feel the Fed
is done implementing rate increases. If the trends of tight employment
and economic strength continue, I believe it is likely the Fed will
raise rates again in early 2000 to slow growth and prevent inflation
from cropping up. The timing and scope of any Fed rate hikes would
most probably be dictated by the pace of the economy and the tightness
of the labor market.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO
MANAGER ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON
THE COVER AND DO NOT NECESSARILY REPRESENT THE VIEWS OF FIDELITY OR
ANY OTHER PERSON IN THE FIDELITY ORGANIZATION. ANY SUCH VIEWS ARE
SUBJECT TO CHANGE AT ANY TIME BASED UPON MARKET OR OTHER CONDITIONS
AND FIDELITY DISCLAIMS ANY RESPONSIBILITY TO UPDATE SUCH VIEWS. THESE
VIEWS MAY NOT BE RELIED ON AS INVESTMENT ADVICE AND, BECAUSE
INVESTMENT DECISIONS FOR A FIDELITY FUND ARE BASED ON NUMEROUS
FACTORS, MAY NOT BE RELIED ON AS AN INDICATION OF TRADING INTENT ON
BEHALF OF ANY FIDELITY FUND.
(checkmark)FUND FACTS
GOAL: high current tax-free
income while maintaining
share price stability by
investing in high-quality,
short-term Connecticut
municipal money market
securities
FUND NUMBER: 425
TRADING SYMBOL: SPCXX
START DATE: March 4, 1991
SIZE: as of November 30,
1999, more than $194
million
MANAGER: Scott Orr, since
1997; manager, various
Fidelity and Spartan
municipal money market
funds; joined Fidelity in
1989
SPARTAN CONNECTICUT MUNICIPAL MONEY MARKET FUND
INVESTMENT CHANGES
<TABLE>
<CAPTION>
<S> <C> <C> <C>
MATURITY DIVERSIFICATION
DAYS % OF FUND'S INVESTMENTS % OF FUND'S INVESTMENTS 5/31/99 % OF FUND'S INVESTMENTS
11/30/99 11/30/98
0 - 30 54.7 59.4 73.8
31 - 90 24.5 21.5 10.9
91 - 180 2.7 19.1 3.2
181 - 397 18.1 0.0 12.1
WEIGHTED AVERAGE MATURITY
11/30/99 5/31/99 11/30/98
Spartan Connecticut Municipal 69 DAYS 39 Days 45 Days
Money Market Fund
Connecticut Tax-Free Money 62 DAYS 40 Days 53 Days
Market Funds Average *
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
ASSET ALLOCATION (% OF FUND'S
NET ASSETS)
AS OF NOVEMBER 30, 1999 AS OF MAY 31, 1999
Variable Rate Demand Notes Variable Rate Demand Notes
(VRDNs) 38.1% (VRDNs) 37.3%
Commercial Paper (including Commercial Paper (including
CP Mode) 20.7% CP Mode) 26.8%
Tender Bonds 11.8% Tender Bonds 7.0%
Municipal Notes 8.9% Municipal Notes 5.9%
Municipal Money Market Funds 16.1% Municipal Money Market Funds 18.7%
Other Investments and Net Other Investments and Net
Other Assets 4.4% Other Assets 4.3%
Row: 1, Col: 1, Value: 38.1 Row: 1, Col: 1, Value: 37.3
Row: 1, Col: 2, Value: 0.0 Row: 1, Col: 2, Value: nil
Row: 1, Col: 3, Value: 20.7 Row: 1, Col: 3, Value: 26.8
Row: 1, Col: 4, Value: 11.8 Row: 1, Col: 4, Value: 7.0
Row: 1, Col: 5, Value: 8.9 Row: 1, Col: 5, Value: 5.9
Row: 1, Col: 6, Value: 16.1 Row: 1, Col: 6, Value: 18.7
Row: 1, Col: 7, Value: 0.0 Row: 1, Col: 7, Value: 0.0
Row: 1, Col: 8, Value: 4.4 Row: 1, Col: 8, Value: 4.3
</TABLE>
PRIOR TO THIS REPORT, CERTAIN INFORMATION RELATED TO PORTFOLIO
HOLDINGS WAS STATED AS A PERCENTAGE OF THE FUND'S INVESTMENTS.
* SOURCE: IBCS MONEY FUND REPORT(registered trademark)
SPARTAN CONNECTICUT MUNICIPAL MONEY MARKET
INVESTMENTS NOVEMBER 30, 1999
Showing Percentage of Net Assets
<TABLE>
<CAPTION>
<S> <C> <C> <C>
MUNICIPAL SECURITIES - 99.4%
PRINCIPAL AMOUNT VALUE (NOTE 1)
CONNECTICUT - 80.0%
Connecticut Clean Wtr. Fund $ 1,300,000 $ 1,300,000
Rev. Bonds Series PA 517,
3.65%, tender 2/1/00
(Liquidity Facility Merrill
Lynch & Co., Inc.) (f)
Connecticut Dev. Auth. Arpt.
Facilities Rev. (Bradley
Arpt. Hotel Proj.):
Series 1997 A, 3.75%, LOC 1,200,000 1,200,000
Kredietbank NV, VRDN (b)
Series 1997 B, 3.75%, LOC 1,000,000 1,000,000
Royal Bank of Canada, VRDN
(b)
Series 1997 C, 3.75%, LOC 470,000 470,000
Fleet Nat'l. Bank, VRDN (b)
Connecticut Dev. Auth. Health 6,900,000 6,900,000
Care Rev. (Corp. for
Independent Living Proj.)
Series 1990, 3.75%, LOC
Chase Manhattan Bank, VRDN
(b)
Connecticut Dev. Auth. Ind.
Dev. Rev.:
(Rojo Enterprises LLC Proj.) 1,000,000 1,000,000
3.95%, LOC Fleet Bank NA,
VRDN (b)
(W.E. Bassett Co. Proj.) 800,000 800,000
Series 1986, 3.6%, LOC
BankBoston NA, VRDN (b)(e)
Connecticut Dev. Auth. Poll.
Cont. Rev.:
Bonds (New England Pwr. Co.
Proj.) Series 1999:
3.55% tender 2/9/00, CP mode 1,400,000 1,400,000
3.75% tender 1/26/00, CP mode 2,100,000 2,100,000
(Connecticut Lt. & Pwr. Co. 6,400,000 6,400,000
Proj.) Series 1996 A, 3.75%
(AMBAC Insured) (BPA Societe
Generale, France), VRDN
(b)(e)
Connecticut Dev. Auth. Rev. 3,700,000 3,700,000
(Exeter Energy Proj.) Series
1989 A, 4.05%, LOC Sanwa
Bank Ltd., VRDN (b)(e)
Connecticut Gen. Oblig.:
Bonds:
Series 1999 A4, 4% 6/15/00 3,100,000 3,110,874
Series PA 347, 3.65%, tender 1,495,000 1,495,000
2/1/00 (Liquidity Facility
Merrill Lynch & Co., Inc.)
(f)
Series B, 3.7% (BPA 2,350,000 2,350,000
Bayerische Landesbank
Girozentrale), VRDN (b)
Connecticut Health & Edl.
Facilities Auth. Rev.:
Bonds:
(Ascension Health Cr. Group 5,000,000 5,000,000
Proj.) Series 1999 B,
3.65%, tender 1/26/00
(Yale Univ. Proj.):
Series S1:
3.4% tender 1/21/00, CP mode 5,000,000 5,000,000
3.6% tender 1/18/00, CP mode 1,500,000 1,500,000
MUNICIPAL SECURITIES -
CONTINUED
PRINCIPAL AMOUNT VALUE (NOTE 1)
CONNECTICUT - CONTINUED
Connecticut Health & Edl.
Facilities Auth. Rev.: -
continued
Series S2:
3.45% tender 1/26/00, CP mode $ 2,265,000 $ 2,265,000
3.45% tender 2/10/00, CP mode 6,000,000 6,000,000
(Yale Univ. Proj.) Series U2, 13,300,000 13,300,001
3.85%, VRDN (b)
Connecticut Hsg. Fin. Auth.:
Participating VRDN:
Series 1997 L, 4.1% 1,795,000 1,795,000
(Liquidity Facility First
Union Nat'l. Bank, North
Carolina) (b)(e)(f)
Series FRRl A4, 3.75% 1,475,000 1,475,000
(Liquidity Facility
Bayerische Hypo-und
Vereinsbank AG) (b)(f)
Series PT 81, 3.86% 1,420,000 1,420,000
(Liquidity Facility Merrill
Lynch & Co., Inc.) (b)(e)(f)
Series PT 148, 3.81% 2,000,000 2,000,000
(Liquidity Facility Merrill
Lynch & Co., Inc.) (b)(f)
Series PT 1003, 3.86% 6,500,000 6,500,000
(Liquidity Facility Merrill
Lynch & Co., Inc.) (b)(e)(f)
(Hsg. Mtg. Fin. Prog.) Series 2,000,000 2,000,000
1995 G, 3.75% (AMBAC
Insured) (BPA Morgan
Guaranty Trust Co., NY),
VRDN (b)
Connecticut Hsg. Fin. Auth.
Rev. Bonds:
(Hsg. Mtg. Fin. Prog.) Series 1,900,000 1,900,000
C2, 3.9%, tender 9/5/00 (e)
Series C1, 3.85%, tender 1,595,000 1,595,000
9/5/00
Connecticut Spl. Assessment
Second Injury Fund:
3.5% 1/27/00, LOC Cr. 2,900,000 2,900,000
Communale De Belgique, LOC
Cr. Agricole Indosuez, CP
3.55% 1/25/00, LOC Cr. 7,300,000 7,300,000
Communale De Belgique, LOC
Cr. Agricole Indosuez, CP
3.55% 1/26/00, LOC Cr. 7,300,000 7,300,000
Communale De Belgique, LOC
Cr. Agricole Indosuez, CP
3.65% 2/1/00, LOC Cr. 2,400,000 2,400,000
Communale De Belgique, LOC
Cr. Agricole Indosuez, CP
3.8% 4/11/00, LOC Cr. 1,800,000 1,800,000
Communale De Belgique, LOC
Cr. Agricole Indosuez, CP
Connecticut Spl. Assessment
Unemployment Compensation
Advisor Fund Rev.:
Series 1993 C, 3.38%, tender 11,500,000 11,500,000
7/1/00 (FGIC Insured), LOC
FGIC-SPI (b)
Rfdg. Bonds Series A, 5.5% 1,600,000 1,615,217
5/15/00 (AMBAC Insured)
Connecticut Spl. Tax Oblig.
Rev.:
Bonds (Tran. Infrastructure 1,540,000 1,550,718
Proj.) Series A, 4.5%
12/1/00 (a)
MUNICIPAL SECURITIES -
CONTINUED
PRINCIPAL AMOUNT VALUE (NOTE 1)
CONNECTICUT - CONTINUED
Connecticut Spl. Tax Oblig.
Rev.: - continued
Participating VRDN Series 52, $ 700,000 $ 700,000
3.84% (Liquidity Facility
Morgan Stanley Dean Witter &
Co.) (b)(f)
(Trans. Infrastructure Purp. 12,580,000 12,580,000
Proj.) Series 1, 3.8%, LOC
Commerzbank AG, VRDN (b)
Groton Town BAN Series A, 2,800,000 2,806,073
3.5% 6/13/00
Hartford Redev. Agcy. 2,400,000 2,400,000
Multi-family Mtg. Rev. Rfdg.
(Underwood Tower Proj.) 3.8%
(FSA Insured) (BPA Societe
Generale, France), VRDN (b)
Norwich Gen. Oblig. BAN 4.1% 1,710,000 1,713,695
5/16/00
Orange Gen. Oblig. BAN 3.8% 1,350,000 1,353,689
8/16/00
Seymour Gen. Oblig. BAN 4.25% 3,000,000 3,009,990
9/20/00 (a)
Shelton Gen. Oblig. BAN 4.25% 4,800,000 4,819,344
11/21/00 (a)
Stamford Gen. Oblig. Bonds 1,190,000 1,195,888
4.5% 7/15/00
Stratford Gen. Oblig. BAN 2,150,000 2,154,085
3.75% 8/23/00
Windsor Gen. Oblig. BAN 3.75% 1,300,000 1,300,593
1/19/00
155,375,167
PUERTO RICO - 3.3%
Puerto Rico Commonwealth Pub. 5,000,000 5,000,000
Impt. Rev. Participating
VRDN Series PT 1025, 3.71%
(Liquidity Facility Bank of
America NA) (b)(f)
Puerto Rico Elec. Pwr. Auth. 1,400,000 1,400,000
Pwr. Rev. Participating VRDN
Series PA 205, 3.71%
(Liquidity Facility Merrill
Lynch & Co., Inc.) (b)(f)
6,400,000
SHARES
OTHER - 16.1%
Municipal Central Cash Fund 31,222,169 31,222,169
3.90% (c)(d)
TOTAL INVESTMENT PORTFOLIO - 192,997,336
99.4%
NET OTHER ASSETS - 0.6% 1,247,332
NET ASSETS - 100% $ 194,244,668
Total Cost for Income Tax Purposes $ 192,997,336
</TABLE>
SECURITY TYPE ABBREVIATIONS
BAN - BOND ANTICIPATION NOTE
CP - COMMERCIAL PAPER
VRDN - VARIABLE RATE DEMAND NOTE
LEGEND
(a) Security purchased on a delayed delivery or when-issued basis.
(b) The coupon rate shown on floating or adjustable rate securities
represents the rate at period end.
(c) Information in this report regarding holdings by state and
security types does not reflect the holdings of the Municipal Central
Cash Fund. A listing of the Municipal Central Cash Fund's holdings as
of its most recent fiscal period end is available upon request.
(d) The rate quoted is the annualized seven-day yield of the fund at
period end.
(e) Private activity obligations whose interest is subject to the
federal alternative minimum tax for individuals.
(f) Provides evidence of ownership in one or more underlying municipal
bonds.
INCOME TAX INFORMATION
At November 30, 1999, the fund had a capital loss carryforward of
approximately $3,000 all of which will expire on November 30, 2006.
During the fiscal year ended 1999, 100% of the fund's income dividends
was free from federal income tax, and 18.33% of the fund's income
dividends was subject to the federal alternative minimum tax
(unaudited).
The fund will notify shareholders in January 2000 of amounts for use
in preparing 1999 income tax returns.
SPARTAN CONNECTICUT MUNICIPAL MONEY MARKET FUND
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
NOVEMBER 30, 1999
ASSETS
Investment in securities, at $ 192,997,336
value - See accompanying
schedule
Receivable for investments 2,432,439
sold
Receivable for fund shares 7,241,610
sold
Interest receivable 1,080,194
TOTAL ASSETS 203,751,579
LIABILITIES
Payable for investments $ 9,383,517
purchased on a delayed
delivery basis
Distributions payable 44,141
Accrued management fee 78,388
Other payables and accrued 865
expenses
TOTAL LIABILITIES 9,506,911
NET ASSETS $ 194,244,668
Net Assets consist of:
Paid in capital $ 194,247,248
Accumulated net realized gain (2,580)
(loss) on investments
NET ASSETS, for 194,247,246 $ 194,244,668
shares outstanding
NET ASSET VALUE, offering $1.00
price and redemption price
per share ($194,244,668
(divided by) 194,247,246
shares)
STATEMENT OF OPERATIONS
YEAR ENDED NOVEMBER 30, 1999
INTEREST INCOME $ 5,860,435
EXPENSES
Management fee $ 925,585
Non-interested trustees' 583
compensation
Total expenses before 926,168
reductions
Expense reductions (12,933) 913,235
NET INTEREST INCOME 4,947,200
NET REALIZED GAIN (LOSS) ON 9,284
INVESTMENTS
NET INCREASE IN NET ASSETS $ 4,956,484
RESULTING FROM OPERATIONS
<TABLE>
<CAPTION>
<S> <C> <C>
STATEMENT OF CHANGES IN NET ASSETS
YEAR ENDED NOVEMBER 30, 1999 YEAR ENDED NOVEMBER 30, 1998
INCREASE (DECREASE) IN NET
ASSETS
Operations Net interest income $ 4,947,200 $ 5,290,021
Net realized gain (loss) 9,284 (3,592)
NET INCREASE (DECREASE) IN 4,956,484 5,286,429
NET ASSETS RESULTING FROM
OPERATIONS
Distributions to shareholders (4,947,200) (5,290,021)
from net interest income
Share transactions at net 179,196,024 195,188,717
asset value of $1.00 per
share Proceeds from sales of
shares
Reinvestment of 4,524,889 5,053,873
distributions from net
interest income
Cost of shares redeemed (179,524,952) (173,846,788)
NET INCREASE (DECREASE) IN 4,195,961 26,395,802
NET ASSETS AND SHARES
RESULTING FROM SHARE
TRANSACTIONS
TOTAL INCREASE (DECREASE) 4,205,245 26,392,210
IN NET ASSETS
NET ASSETS
Beginning of period 190,039,423 163,647,213
End of period $ 194,244,668 $ 190,039,423
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
FINANCIAL HIGHLIGHTS
YEARS ENDED NOVEMBER 30, 1999 1998 1997 1996 1995
SELECTED PER-SHARE DATA
Net asset value, beginning $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
of period
Income from Investment .027 .030 .031 .030 .034
Operations Net interest
income
Less Distributions
From net interest income (.027) (.030) (.031) (.030) (.034)
Net asset value, end of period $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
TOTAL RETURN A, B 2.70% 3.05% 3.12% 3.08% 3.41%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 194,245 $ 190,039 $ 163,647 $ 186,974 $ 175,622
(000 omitted)
Ratio of expenses to average .50% .50% .50% .50% .50%
net assets
Ratio of expenses to average .49% C .49% C .50% .50% .50%
net assets after expense
reductions
Ratio of net investment 2.67% 3.00% 3.08% 3.04% 3.36%
income to average net assets
</TABLE>
A THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT
BEEN REDUCED DURING THE PERIODS SHOWN.
B TOTAL RETURNS DO NOT INCLUDE THE ACCOUNT CLOSEOUT FEE.
C FMR OR THE FUND HAS ENTERED INTO VARYING ARRANGEMENTS WITH THIRD
PARTIES WHO EITHER PAID OR REDUCED A PORTION OF THE FUND'S EXPENSES.
FIDELITY CONNECTICUT MUNICIPAL MONEY MARKET FUND
PERFORMANCE: THE BOTTOM LINE
To evaluate a money market fund's historical performance, you can look
at either total return or yield. Total return reflects the change in
the value of an investment, assuming reinvestment of the fund's
dividend income. Yield measures the income paid by a fund. Since a
money market fund tries to maintain a $1 share price, yield is an
important measure of performance. If Fidelity had not reimbursed
certain fund expenses, the past 10 year total returns would have been
lower.
CUMULATIVE TOTAL RETURNS
PERIODS ENDED NOVEMBER 30, 1999 PAST 1 YEAR PAST 5 YEARS PAST 10 YEARS
FIDELITY CT MUNICIPAL MONEY 2.63% 15.79% 36.94%
MARKET
Connecticut Tax-Free Money 2.43% 15.01% 33.30%
Market Funds Average
CUMULATIVE TOTAL RETURNS show the fund's performance in percentage
terms over a set period - in this case, one year, five years or 10
years. For example, if you had invested $1,000 in a fund that had a 5%
return over the past year, the value of your investment would be
$1,050. To measure how the fund's performance stacked up against its
peers, you can compare it to the Connecticut tax-free money market
funds average, which reflects the performance of tax-free money market
funds with similar objectives tracked by IBC Financial Data, Inc. The
past one year average represents a peer group of 10 money market
funds.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED NOVEMBER 30, 1999 PAST 1 YEAR PAST 5 YEARS PAST 10 YEARS
FIDELITY CT MUNICIPAL MONEY 2.63% 2.98% 3.19%
MARKET
Connecticut Tax-Free Money 2.43% 2.83% 2.91%
Market Funds Average
AVERAGE ANNUAL TOTAL RETURNS take the fund's cumulative return and
show you what would have happened if the fund had performed at a
constant rate each year.
YIELDS
11/29/99 8/30/99 5/31/99 3/1/99 11/30/98
Fidelity Connecticut 3.05% 2.66% 2.65% 2.28% 2.60%
Municipal Money Market Fund
Connecticut Tax-Free Money 2.88% 2.45% 2.41% 2.15% 2.44%
Market Funds Average
Fidelity Connecticut 4.98% 4.35% 4.34% 3.72% 4.26%
Municipal Money Market
Fund - Tax-equivalent
Portion of fund's income 18.96% 16.33% 13.83% 22.21% 21.49%
subject to state taxes
YIELD refers to the income paid by the fund over a given period.
Yields for money market funds are usually for seven-day periods,
expressed as annual percentage rates. A yield that assumes income
earned is reinvested or compounded is called an effective yield. The
table above shows the fund's current seven-day yield at quarterly
intervals over the past year. You can compare these yields to the
Connecticut tax-free money market funds average as tracked by IBC
Financial Data, Inc. or you can look at the fund's tax-equivalent
yield, which is based on a combined effective 1999 federal and state
income tax rate of 38.88%. The fund's yields mentioned above reflect
that a portion of the fund's income was subject to state taxes. A
portion of the fund's income may be subject to the federal alternative
minimum tax.
(checkmark)COMPARING
PERFORMANCE
Yields on tax-free investments
are usually lower than yields
on taxable investments.
However, a straight
comparison between the two
may be misleading because it
ignores the way taxes reduce
taxable returns. Tax-equivalent
yield - the yield you'd have to
earn on a similar taxable
investment to match the tax-free
yield - makes the comparison
more meaningful. Keep in mind
that the U.S. government
neither insures nor guarantees
a money market fund. In fact,
there is no assurance that a
money fund will maintain a $1
share price.
A MONEY MARKET FUND'S TOTAL RETURNS AND YIELDS WILL VARY, AND REFLECT
PAST RESULTS RATHER THAN PREDICT FUTURE PERFORMANCE.
FIDELITY CONNECTICUT MUNICIPAL MONEY MARKET FUND
FUND TALK: THE MANAGER'S OVERVIEW
(photograph of Scott Orr)
An interview with Scott Orr, Portfolio Manager of Fidelity Connecticut
Municipal Money Market Fund
Q. SCOTT, WHAT WAS THE INVESTMENT ENVIRONMENT LIKE OVER THE 12 MONTHS
THAT ENDED NOVEMBER 30, 1999?
A. At the beginning of the period, a global economic crisis continued
to cast a shadow over the market. There were many questions about the
pace of U.S. economic growth and the direction of interest rates.
Early in 1999, however, any doubts were put to rest, as both growth
and employment strengthened. In addition, data began to indicate that
inflation might not be as well-behaved as it had been in the recent
past. Faced with that backdrop, market observers began to feel that
the Federal Reserve Board would raise short-term interest rates to
slow growth and head off inflation. Through the rest of the period,
economic growth remained solid and unemployment stayed at historically
low levels. Such a tight labor market often leads to inflation, as
employers are forced to raise salaries in order to attract or retain
workers, passing on the additional cost to the consumer. The Fed
indicated that improvements in worker productivity had helped keep
inflation at bay. Nevertheless, with constant, broad-based economic
strength and continually tight labor markets, the Fed felt compelled
to take back all three of the rate cuts it had implemented in the fall
of 1998. It did so with a series of three 0.25 percentage point rate
hikes in June, August and November, raising the rate banks charge each
other for overnight loans - known as the fed funds rate - from 4.75%
at the beginning of the period to 5.50% by the end of November 1999.
Q. WHAT WAS YOUR STRATEGY WITH THE FUND?
A. From December 1998 through the end of May 1999, I kept the fund's
average maturity relatively short because yields on long-term
securities were unattractive. At the end of May, new supply helped
push long-term yields higher, so I took advantage of opportunities
among one-year, fixed-rate notes. Nevertheless, by mid-June the fund's
average maturity was slightly shorter than its peers because I wanted
to wait until long-term securities adequately reflected my
expectations for higher rates. Market rates began to price in future
Fed rate hikes in June and July, at the same time that new supply hit
the market, boosting yields on one-year notes. I took advantage of the
opportunity to extend the fund's maturity. It remained relatively
stable until the end of November, when I increased it further by
buying securities that I felt would perform well over the next year.
Q. WHY DID THE FUND INVEST OUT-OF-STATE?
A. The fund pursued this strategy - within the limits of the fund's
investment policies - in order to provide shareholders with a higher
tax-adjusted yield. In certain cases, yields on Connecticut
obligations were sufficiently low so that comparable out-of-state
obligations provided a higher tax-adjusted yield even though they are
subject to Connecticut tax. Even though more of shareholders' income
for the fund's 1999 fiscal year will be taxable than if I had
purchased exclusively Connecticut obligations, shareholders may be
able to retain more of a fund's dividends, after taxes are taken into
account. The fund may also invest out-of-state if there is a limited
supply of Connecticut obligations.
Q. HOW DID THE FUND PERFORM?
A. The fund's seven-day yield on November 30, 1999, was 3.05%,
compared to 2.60% 12 months ago. The more recent seven-day yield was
the equivalent of a 4.98% taxable rate of return for Connecticut
investors in the 38.88% combined state and federal income tax bracket.
The fund's yields reflect that a portion of the fund's income was
subject to state taxes. Through November 30, 1999, the fund's 12-month
total return was 2.63%, compared to 2.43% for the Connecticut tax-free
money market funds average, according to IBC Financial Data, Inc.
Q. WHAT IS YOUR OUTLOOK?
A. Before the Fed's most recent rate hike, market sentiment reflected
the belief that the Fed would sit back and wait to see what happens
after bringing rates back to their 1998 levels. However, judging by
its reaction to the latest Fed move, the market doesn't feel the Fed
is done implementing rate increases. If the trends of tight employment
and economic strength continue, I believe it is likely the Fed will
raise rates again in early 2000 to slow growth and prevent inflation
from cropping up. The timing and scope of any Fed rate hikes would
most probably be dictated by the pace of the economy and the tightness
of the labor market.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO
MANAGER ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON
THE COVER AND DO NOT NECESSARILY REPRESENT THE VIEWS OF FIDELITY OR
ANY OTHER PERSON IN THE FIDELITY ORGANIZATION. ANY SUCH VIEWS ARE
SUBJECT TO CHANGE AT ANY TIME BASED UPON MARKET OR OTHER CONDITIONS
AND FIDELITY DISCLAIMS ANY RESPONSIBILITY TO UPDATE SUCH VIEWS. THESE
VIEWS MAY NOT BE RELIED ON AS INVESTMENT ADVICE AND, BECAUSE
INVESTMENT DECISIONS FOR A FIDELITY FUND ARE BASED ON NUMEROUS
FACTORS, MAY NOT BE RELIED ON AS AN INDICATION OF TRADING INTENT ON
BEHALF OF ANY FIDELITY FUND.
(checkmark)FUND FACTS
GOAL: high current tax-free
income while maintaining
share price stability by
investing in high-quality,
short-term Connecticut
municipal money market
securities
FUND NUMBER: 418
TRADING SYMBOL: FCMXX
START DATE: August 29, 1989
SIZE: as of November 30,
1999, more than $532
million
MANAGER: Scott Orr, since
1997; manager, various
Fidelity and Spartan
municipal money market
funds; joined Fidelity in
1989
FIDELITY CONNECTICUT MUNICIPAL MONEY MARKET FUND
INVESTMENT CHANGES
<TABLE>
<CAPTION>
<S> <C> <C> <C>
MATURITY DIVERSIFICATION
DAYS % OF FUND'S INVESTMENTS % OF FUND'S INVESTMENTS 5/31/99 % OF FUND'S INVESTMENTS
11/30/99 11/30/98
0 - 30 50.7 60.5 75.7
31 - 90 27.2 22.1 8.6
91 - 180 3.6 16.1 3.4
181 - 397 18.5 1.3 12.3
WEIGHTED AVERAGE MATURITY
11/30/99 5/31/99 11/30/98
Fidelity Connecticut 73 DAYS 40 Days 45 Days
Municipal Money Market Fund
Connecticut Tax-Free Money 62 DAYS 40 Days 53 Days
Market Funds Average *
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
ASSET ALLOCATION (% OF FUND'S
NET ASSETS)
AS OF NOVEMBER 30, 1999 AS OF MAY 31, 1999
Variable Rate Demand Notes Variable Rate Demand Notes
(VRDNs) 32.2% (VRDNs) 43.8%
Commercial Paper (including Commercial Paper (including
CP Mode) 24.0% CP Mode) 25.1%
Tender Bonds 13.6% Tender Bonds 7.1%
Municipal Notes 9.5% Municipal Notes 5.4%
Municipal Money Market Funds 17.7% Municipal Money Market Funds 13.2%
Other Investments and Net Other Investments and Net
Other Assets 3.0% Other Assets 5.4%
Row: 1, Col: 1, Value: 32.2 Row: 1, Col: 1, Value: 43.8
Row: 1, Col: 2, Value: 0.0 Row: 1, Col: 2, Value: 0.0
Row: 1, Col: 3, Value: 24.0 Row: 1, Col: 3, Value: 25.1
Row: 1, Col: 4, Value: 13.6 Row: 1, Col: 4, Value: 7.1
Row: 1, Col: 5, Value: 9.5 Row: 1, Col: 5, Value: 5.4
Row: 1, Col: 6, Value: 17.7 Row: 1, Col: 6, Value: 13.2
Row: 1, Col: 7, Value: 0.0 Row: 1, Col: 7, Value: 0.0
Row: 1, Col: 8, Value: 3.0 Row: 1, Col: 8, Value: 5.4
</TABLE>
PRIOR TO THIS REPORT, CERTAIN INFORMATION RELATED TO PORTFOLIO
HOLDINGS WAS STATED AS A PERCENTAGE OF THE FUND'S INVESTMENTS.
FIDELITY CONNECTICUT MUNICIPAL MONEY MARKET FUND
INVESTMENTS NOVEMBER 30, 1999
Showing Percentage of Net Assets
MUNICIPAL SECURITIES - 101.9%
PRINCIPAL AMOUNT VALUE (NOTE 1)
CONNECTICUT - 82.5%
Connecticut Clean Wtr. Fund $ 3,195,000 $ 3,195,000
Rev. Bonds Series PA 517,
3.65%, tender 2/1/00
(Liquidity Facility Merrill
Lynch & Co., Inc.) (f)
Connecticut Dev. Auth. Arpt.
Facilities Rev. (Bradley
Arpt. Hotel Proj.):
Series 1997 A, 3.75%, LOC 3,900,000 3,900,000
Kredietbank, NV, VRDN (b)
Series 1997 C, 3.75%, LOC 830,000 830,000
Fleet Nat'l. Bank, VRDN (b)
Connecticut Dev. Auth. Health
Care Rev.:
(Corp. for Independent Living 3,800,000 3,800,000
Proj.) Series 1990, 3.75%,
LOC Chase Manhattan Bank,
VRDN (b)
Rfdg. (Corp. for Independent 2,565,000 2,565,000
Living Proj.) Series 1999,
3.75%, LOC Cr. Local de
France, VRDN (b)
Connecticut Dev. Auth. Ind.
Dev. Rev.:
(Rojo Enterprises LLC Proj.) 1,700,000 1,700,000
3.95%, LOC Fleet Bank NA,
VRDN (b)
(W.E. Bassett Co. Proj.) 800,000 800,000
Series 1986, 3.6%, LOC
BankBoston NA, VRDN (b)(e)
Rfdg. (Cap. District Energy 6,600,000 6,600,000
Ctr. Proj.) Series 1998,
3.9%, LOC Fleet Nat'l. Bank,
VRDN (b)(e)
Connecticut Dev. Auth. Poll.
Cont. Rev.:
Bonds (New England Pwr. Co.
Proj.) Series 1999:
3.55% tender 2/9/00, CP mode 4,000,000 4,000,000
3.55% tender 3/1/00, CP mode 1,900,000 1,900,000
3.55% tender 3/1/00, CP mode 250,000 250,000
3.75% tender 1/26/00, CP mode 5,900,000 5,900,000
(Connecticut Lt. & Pwr. Co. 9,400,000 9,400,000
Proj.) Series 1996 A, 3.75%
(AMBAC Insured) (BPA Societe
Generale, France), VRDN
(b)(e)
Connecticut Dev. Auth. Rev.
(Exeter Energy Proj.):
Series 1989 A, 4.05%, LOC 6,200,000 6,200,000
Sanwa Bank Ltd., VRDN (b)(e)
Series 1989 B, 4.05%, LOC 4,400,000 4,400,000
Sanwa Bank Ltd., VRDN (b)(e)
Connecticut Gen. Oblig. Bonds:
Series 1998 C, 4% 10/15/00 2,000,000 2,005,240
Series 1999 A4, 4% 6/15/00 8,900,000 8,931,220
Series D, 3.75% 12/1/99 3,200,000 3,200,000
Series PA 338, 3.65%, tender 5,895,000 5,895,000
2/1/00 (Liquidity Facility
Merrill Lynch & Co., Inc.)
(f)
Series PA 347, 3.65%, tender 3,500,000 3,500,000
2/1/00 (Liquidity Facility
Merrill Lynch & Co., Inc.)
(f)
MUNICIPAL SECURITIES -
CONTINUED
PRINCIPAL AMOUNT VALUE (NOTE 1)
CONNECTICUT - CONTINUED
Connecticut Health & Edl.
Facilities Auth. Rev.:
Bonds:
(Ascension Health Cr. Group $ 13,700,000 $ 13,700,000
Proj.) Series 1999 B, 3.65%,
tender 1/26/00
(Yale Univ. Proj.):
Series S1:
3.4% tender 1/21/00, CP mode 2,000,000 2,000,000
3.4% tender 1/21/00, CP mode 6,000,000 6,000,000
3.6% tender 1/18/00, CP mode 4,600,000 4,600,000
3.7% tender 2/10/00, CP mode 5,000,000 5,000,000
3.75% tender 2/1/00, CP mode 2,435,000 2,435,000
Series S2:
3.45% tender 1/26/00, CP mode 7,500,000 7,500,000
3.45% tender 2/10/00, CP mode 18,200,000 18,200,000
3.55% tender 1/26/00, CP mode 2,000,000 2,000,000
3.65% tender 3/1/00, CP mode 3,300,000 3,300,000
(Pomfret School Issue Proj.) 900,000 900,000
Series A, 3.9%, LOC Cr.
Local de France, VRDN (b)
(Yale Univ. Proj.):
Series U1, 3.85%, VRDN (b) 13,700,000 13,700,000
Series U2, 3.85%, VRDN (b) 13,800,000 13,800,000
Connecticut Hsg. Fin. Auth.:
Bonds (Hsg. Mortgage Fin. 2,000,000 2,000,000
Prog. Proj.) Series 1989 D,
3.6% tender 1/21/00, CP mode
(e)
Participating VRDN:
Series 1997 L, 4.1% 3,670,000 3,670,000
(Liquidity Facility First
Union Nat'l. Bank, North
Carolina) (b)(e)(f)
Series FRRl A4, 3.75% 3,200,000 3,200,000
(Liquidity Facility
Bayerische Hypo-und
Vereinsbank AG) (b)(f)
Series PT 81, 3.86% 2,460,000 2,460,000
(Liquidity Facility Merrill
Lynch & Co., Inc.) (b)(e)(f)
Series PT 1003, 3.86% 17,985,000 17,985,000
(Liquidity Facility Merrill
Lynch & Co., Inc.) (b)(e)(f)
(Hsg. Mtg. Fin. Prog.) Series 13,670,000 13,670,000
1995 G, 3.75% (AMBAC
Insured) (BPA Morgan
Guaranty Trust Co., NY),
VRDN (b)
Connecticut Hsg. Fin. Auth.
Rev. Bonds:
(Fin. Prog.) Series 1999 B, 2,500,000 2,500,000
3.4%, tender 12/15/99 (e)
(Hsg. Mtg. Fin. Prog.) Series 5,200,000 5,200,000
C2, 3.9%, tender 9/5/00 (e)
Series C1, 3.85%, tender 4,300,000 4,300,000
9/5/00
MUNICIPAL SECURITIES -
CONTINUED
PRINCIPAL AMOUNT VALUE (NOTE 1)
CONNECTICUT - CONTINUED
Connecticut Spl. Assessment
Second Injury Fund:
3.5% 1/27/00, LOC Cr. $ 8,300,000 $ 8,300,000
Communale De Belgique, LOC
Cr. Agricole Indosuez, CP
3.55% 1/25/00, LOC Cr. 17,400,000 17,400,000
Communale De Belgique, LOC
Cr. Agricole Indosuez, CP
3.55% 1/26/00, LOC Cr. 17,500,000 17,500,000
Communale De Belgique, LOC
Cr. Agricole Indosuez, CP
3.65% 2/1/00, LOC Cr. 6,600,000 6,600,000
Communale De Belgique, LOC
Cr. Agricole Indosuez, CP
3.65% 2/17/00, LOC Cr. 8,000,000 8,000,000
Communale De Belgique, LOC
Cr. Agricole Indosuez, CP
3.8% 4/11/00, LOC Cr. 4,700,000 4,700,000
Communale De Belgique, LOC
Cr. Agricole Indosuez, CP
Connecticut Spl. Assessment
Unemployment Compensation
Advisor Fund Rev.:
Bonds Series 1993 C, 3.38%, 33,480,000 33,480,000
tender 7/1/00 (FGIC
Insured), LOC FGIC-SPI (b)
Rfdg. Bonds Series A, 5.5% 4,400,000 4,441,847
5/15/00 (AMBAC Insured)
Connecticut Spl. Tax Oblig.
Rev.:
Bonds (Tran. Infrastructure 4,300,000 4,329,928
Proj.) Series A, 4.5%
12/1/00 (a)
Participating VRDN Series 52, 2,400,000 2,400,000
3.84% (Liquidity Facility
Morgan Stanley Dean Witter &
Co.) (b)(f)
(Trans. Infrastructure Purp. 33,660,000 33,659,999
Proj.) Series 1, 3.8%, LOC
Commerzbank AG, VRDN (b)
Groton Town BAN:
Series A, 3.5% 6/13/00 2,200,000 2,204,772
Series B, 3.5% 6/13/00 5,318,000 5,329,535
Hartford Redev. Agcy. 11,945,000 11,945,000
Multi-family Mtg. Rev. Rfdg.
(Underwood Tower Proj.) 3.8%
(FSA Insured) (BPA Societe
Generale, France), VRDN (b)
New Britain Gen. Oblig. 3,000,000 3,000,000
Series 1999, 3.75% (AMBAC
Insured) (BPA Bank of Nova
Scotia), VRDN (b)
New Haven Facilities Rev. 2,100,000 2,100,000
(Starter Sportswear Proj.)
Series 1986, 3.65%, LOC
Fleet Bank NA, VRDN (b)(e)
Norwich Gen. Oblig. BAN 4.1% 4,800,000 4,810,371
5/16/00
Old Saybrook Gen. Oblig. BAN 2,675,000 2,675,134
3.75% 12/7/99
Orange Gen. Oblig. BAN 3.8% 4,000,000 4,010,929
8/16/00
Seymour Gen. Oblig. BAN 4.25% 8,500,000 8,528,305
9/20/00 (a)
MUNICIPAL SECURITIES -
CONTINUED
PRINCIPAL AMOUNT VALUE (NOTE 1)
CONNECTICUT - CONTINUED
Shelton Gen. Oblig. BAN:
3.25% 12/1/99 $ 1,250,000 $ 1,250,000
4.25% 11/21/00 (a) 7,200,000 7,229,016
4.375% 11/21/00 (a) 6,100,000 6,130,012
Stamford Gen. Oblig. Bonds 3,000,000 3,014,844
4.5% 7/15/00
Stratford Gen. Oblig. BAN 6,000,000 6,011,400
3.75% 8/23/00
Windsor Gen. Oblig. BAN 3.75% 3,700,000 3,701,688
1/19/00
439,844,240
PUERTO RICO - 1.7%
Puerto Rico Commonwealth Pub. 4,745,000 4,745,000
Impt. Rev. Participating
VRDN Series PA 97, 3.71%
(Liquidity Facility Merrill
Lynch & Co., Inc.) (b)(f)
Puerto Rico Elec. Pwr. Auth. 4,195,000 4,195,000
Pwr. Rev. Participating VRDN
Series PA 311, 3.71%
(Liquidity Facility Merrill
Lynch & Co., Inc.) (b)(f)
8,940,000
SHARES
OTHER - 17.7%
Municipal Central Cash Fund 94,203,319 94,203,319
3.90% (c)(d)
TOTAL INVESTMENT PORTFOLIO - 542,987,559
101.9%
NET OTHER ASSETS - (1.9)% (10,039,091)
NET ASSETS - 100% $ 532,948,468
Total Cost for Income Tax Purposes $ 542,987,559
SECURITY TYPE ABBREVIATIONS
BAN - BOND ANTICIPATION NOTE
CP - COMMERCIAL PAPER
VRDN - VARIABLE RATE DEMAND NOTE
LEGEND
(a) Security purchased on a delayed delivery or when-issued basis.
(b) The coupon rate shown on floating or adjustable rate securities
represents the rate at period end.
(c) Information in this report regarding holdings by state and
security types does not reflect the holdings of the Municipal Central
Cash Fund. A listing of the Municipal Central Cash Fund's holdings as
of its most recent fiscal period end is available upon request.
(d) The rate quoted is the annualized seven-day yield of the fund at
period end.
(e) Private activity obligations whose interest is subject to the
federal alternative minimum tax for individuals.
(f) Provides evidence of ownership in one or more underlying municipal
bonds.
INCOME TAX INFORMATION
At November 30, 1999, the fund had a capital loss carryforward of
approximately $33,000 of which $4,000, $3,000, $7,000 and $19,000 will
expire on November 30, 2002, 2003, 2005 and 2006, respectively.
During the fiscal year ended 1999, 100% of the fund's income dividends
was free from federal income tax, and 16.86% of the fund's income
dividends was subject to the federal alternative minimum tax
(unaudited).
The fund will notify shareholders in January 2000 of amounts for use
in preparing 1999 income tax returns.
FIDELITY CONNECTICUT MUNICIPAL MONEY MARKET FUND
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
NOVEMBER 30, 1999
ASSETS
Investment in securities, at $ 542,987,559
value - See accompanying
schedule
Receivable for investments 8,918,945
sold
Receivable for fund shares 6,680,827
sold
Interest receivable 3,091,774
Prepaid expenses 1,566
TOTAL ASSETS 561,680,671
LIABILITIES
Payable for investments $ 26,226,936
purchased on a delayed
delivery basis
Payable for fund shares 2,187,608
redeemed
Distributions payable 52,712
Accrued management fee 165,406
Other payables and accrued 99,541
expenses
TOTAL LIABILITIES 28,732,203
NET ASSETS $ 532,948,468
Net Assets consist of:
Paid in capital $ 532,981,316
Accumulated net realized gain (32,848)
(loss) on investments
NET ASSETS, for 532,981,228 $ 532,948,468
shares outstanding
NET ASSET VALUE, offering $1.00
price and redemption price
per share ($532,948,468
(divided by) 532,981,228
shares)
STATEMENT OF OPERATIONS
YEAR ENDED NOVEMBER 30, 1999
INTEREST INCOME $ 16,517,854
EXPENSES
Management fee $ 1,998,514
Transfer agent fees 676,700
Accounting fees and expenses 87,094
Non-interested trustees' 1,662
compensation
Custodian fees and expenses 21,010
Registration fees 35,765
Audit 22,532
Legal 28,719
Miscellaneous 15,195
Total expenses before 2,887,191
reductions
Expense reductions (35,889) 2,851,302
NET INTEREST INCOME 13,666,552
NET REALIZED GAIN (LOSS) ON 3,924
INVESTMENTS
NET INCREASE IN NET ASSETS $ 13,670,476
RESULTING FROM OPERATIONS
<TABLE>
<CAPTION>
<S> <C> <C>
STATEMENT OF CHANGES IN NET ASSETS
YEAR ENDED NOVEMBER 30, 1999 YEAR ENDED NOVEMBER 30, 1998
INCREASE (DECREASE) IN NET
ASSETS
Operations Net interest income $ 13,666,552 $ 12,938,963
Net realized gain (loss) 3,924 (18,425)
NET INCREASE (DECREASE) IN 13,670,476 12,920,538
NET ASSETS RESULTING FROM
OPERATIONS
Distributions to shareholders (13,666,552) (12,938,963)
from net interest income
Share transactions at net 1,451,002,966 1,319,043,753
asset value of $1.00 per
share Proceeds from sales of
shares
Reinvestment of 12,978,333 12,271,598
distributions from net
interest income
Cost of shares redeemed (1,419,026,955) (1,230,483,349)
NET INCREASE (DECREASE) IN 44,954,344 100,832,002
NET ASSETS AND SHARES
RESULTING FROM SHARE
TRANSACTIONS
TOTAL INCREASE (DECREASE) 44,958,268 100,813,577
IN NET ASSETS
NET ASSETS
Beginning of period 487,990,200 387,176,623
End of period $ 532,948,468 $ 487,990,200
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
FINANCIAL HIGHLIGHTS
YEARS ENDED NOVEMBER 30, 1999 1998 1997 1996 1995
SELECTED PER-SHARE DATA
Net asset value, beginning $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
of period
Income from Investment .026 .029 .030 .029 .032
Operations Net interest
income
Less Distributions
From net interest income (.026) (.029) (.030) (.029) (.032)
Net asset value, end of period $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
TOTAL RETURN A 2.63% 2.94% 3.05% 2.98% 3.29%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 532,948 $ 487,990 $ 387,177 $ 339,487 $ 321,870
(000 omitted)
Ratio of expenses to average .55% .56% .58% .59% .61%
net assets
Ratio of expenses to average .54% B .56% .57% B .58% B .61%
net assets after expense
reductions
Ratio of net interest income 2.60% 2.90% 3.00% 2.93% 3.24%
to average net assets
</TABLE>
A THE TOTAL RETURNS WOULD HAVE BEEN LOWER HAD CERTAIN EXPENSES NOT
BEEN REDUCED DURING THE PERIODS SHOWN.
B FMR OR THE FUND HAS ENTERED INTO VARYING ARRANGEMENTS WITH THIRD
PARTIES WHO EITHER PAID OR REDUCED A PORTION OF THE FUND'S EXPENSES.
NOTES TO FINANCIAL STATEMENTS
For the period ended November 30, 1999
1. SIGNIFICANT ACCOUNTING POLICIES.
Spartan Connecticut Municipal Income Fund (the income fund) is a fund
of Fidelity Court Street Trust. Spartan Connecticut Municipal Money
Market Fund and Fidelity Connecticut Municipal Money Market Fund (the
money market funds) are funds of Fidelity Court Street Trust II. Each
trust is registered under the Investment Company Act of 1940, as
amended (the 1940 Act), as an open-end management investment company.
Fidelity Court Street Trust and Fidelity Court Street Trust II (the
trusts) are organized as a Massachusetts business trust and a Delaware
business trust, respectively. Each fund is authorized to issue an
unlimited number of shares. The financial statements have been
prepared in conformity with generally accepted accounting principles
which require management to make certain estimates and assumptions at
the date of the financial statements. Each fund may be affected by
economic and political developments in the state of Connecticut. The
following summarizes the significant accounting policies of the income
fund and the money market funds:
SECURITY VALUATION.
INCOME FUND. Securities are valued based upon a computerized matrix
system and/or appraisals by a pricing service, both of which consider
market transactions and dealer-supplied valuations. Securities for
which quotations are not readily available are valued at their fair
value as determined in good faith under consistently applied
procedures under the general supervision of the Board of Trustees.
Short-term securities with remaining maturities of sixty days or less
for which quotations are not readily available are valued at amortized
cost or original cost plus accrued interest, both of which approximate
current value.
MONEY MARKET FUNDS. As permitted under Rule 2a-7 of the 1940 Act, and
certain conditions therein, securities are valued initially at cost
and thereafter assume a constant amortization to maturity of any
discount or premium.
INCOME TAXES. As a qualified regulated investment company under
Subchapter M of the Internal Revenue Code, each fund is not subject to
income taxes to the extent that it distributes substantially all of
its taxable income for the fiscal year. The schedules of investments
include information regarding income taxes under the caption "Income
Tax Information."
INTEREST INCOME. Interest income, which includes amortization of
premium and accretion of original issue discount, is accrued as
earned. For the money market funds, accretion of discount represents
unrealized gain until realized at the time of a security disposition
or maturity.
EXPENSES. Most expenses of each trust can be directly attributed to a
fund. Expenses which cannot be directly attributed are apportioned
among the funds in the trust.
DISTRIBUTIONS TO SHAREHOLDERS. Dividends are declared daily and paid
monthly from net interest income. Distributions to shareholders from
realized capital gains on investments, if any, are recorded on the
ex-dividend date.
1. SIGNIFICANT ACCOUNTING
POLICIES - CONTINUED
DISTRIBUTIONS TO SHAREHOLDERS -
CONTINUED
Income and capital gain distributions are determined in accordance
with income tax regulations which may differ from generally accepted
accounting principles. These differences, which may result in
distribution reclassifications, are primarily due to differing
treatments for futures transactions and losses deferred due to futures
transactions and excise tax regulations. The income fund also utilized
earnings and profits distributed to shareholders on redemption of
shares as a part of the dividends paid deduction for income tax
purposes.
Permanent book and tax basis differences relating to shareholder
distributions will result in reclassifications to paid in capital and
may affect the per-share allocation between net interest income and
realized and unrealized gain (loss). Accumulated undistributed net
realized gain (loss) on investments may include temporary book and tax
basis differences that will reverse in a subsequent period. Any
taxable gain remaining at fiscal year end is distributed in the
following year.
SHORT-TERM TRADING (REDEMPTION) FEES. Shares held in the income fund
less than 180 days are subject to a short-term trading fee equal to
.50% of the proceeds of the redeemed shares. The fee, which is
retained by the fund, is accounted for as an addition to paid in
capital.
SECURITY TRANSACTIONS. Security transactions are accounted for as of
trade date. Gains and losses on securities sold are determined on the
basis of identified cost.
2. OPERATING POLICIES.
MUNICIPAL CENTRAL CASH FUND. Pursuant to an Exemptive Order issued by
the Securities and Exchange Commission (the SEC), the funds may invest
in the Municipal Central Cash Fund (the Cash Fund) managed by Fidelity
Investments Money Management, Inc. (FIMM), an affiliate of Fidelity
Management & Research Company (FMR). The Cash Fund is an open-end
money market fund available only to investment companies and other
accounts managed by FMR and its affiliates. The Cash Fund seeks
preservation of capital, liquidity, and current income by investing in
high-quality, short-term municipal securities of various states and
municipalities. Income distributions from the Cash Fund are declared
daily and paid monthly from net interest income. Income distributions
earned by the funds are recorded as interest income in the
accompanying financial statements.
DELAYED DELIVERY TRANSACTIONS AND WHEN ISSUED SECURITIES. Each fund
may purchase or sell securities on a delayed delivery basis. Payment
and delivery may take place after the customary settlement period for
that security. The price of the underlying securities and the date
when the securities will be delivered and paid for are fixed at the
time the transaction is negotiated. The values of the securities
purchased on a delayed delivery basis are identified as such in each
applicable fund's schedule of investments. Each fund may receive
compensation for interest forgone in the purchase of a delayed
delivery security.
2. OPERATING POLICIES -
CONTINUED
DELAYED DELIVERY TRANSACTIONS AND WHEN ISSUED SECURITIES - CONTINUED
With respect to purchase commitments, each fund identifies securities
as segregated in its records with a value at least equal to the amount
of the commitment. Losses may arise due to changes in the value of the
underlying securities or if the counterparty does not perform under
the contract, or if the issuer does not issue the securities due to
political, economic, or other factors.
FUTURES CONTRACTS. The income fund may use futures contracts to manage
its exposure to the bond market and to fluctuations in interest rates.
Buying futures tends to increase a fund's exposure to the underlying
instrument, while selling futures tends to decrease a fund's exposure
to the underlying instrument or hedge other fund investments. Futures
contracts involve, to varying degrees, risk of loss in excess of the
futures variation margin reflected in the Statement of Assets and
Liabilities. The underlying face amount at value of any open futures
contracts at period end is shown in the schedule of investments under
the caption "Futures Contracts." This amount reflects each contract's
exposure to the underlying instrument at period end. Losses may arise
from changes in the value of the underlying instruments or if the
counterparties do not perform under the contracts' terms. Gains
(losses) are realized upon the expiration or closing of the futures
contracts. Futures contracts are valued at the settlement price
established each day by the board of trade or exchange on which they
are traded.
3. PURCHASES AND SALES OF INVESTMENTS.
INCOME FUND. Purchases and sales of securities, other than short-term
securities, aggregated $84,114,084 and $91,819,965, respectively.
The market value of futures contracts opened and closed during the
period amounted to $28,464,281 and $23,904,391, respectively.
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES.
MANAGEMENT FEE. As the investment adviser for Fidelity Connecticut
Municipal Money Market Fund, FMR receives a monthly fee that is
calculated on the basis of a group fee rate plus a fixed individual
fund fee rate applied to the average net assets of the fund. The group
fee rate is the weighted average of a series of rates and is based on
the monthly average net assets of all the mutual funds advised by FMR.
The rates ranged from .0920% to .3700% for the period. The annual
individual fund fee rate is .25%. In the event that these rates were
lower than the contractual rates in effect during the period, FMR
voluntarily implemented the above rates, as they resulted in the same
or a lower management fee. For the period, the management fee was
equivalent to an annualized rate of .38% of average net assets for
Fidelity Connecticut Municipal Money Market Fund.
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES - CONTINUED
MANAGEMENT FEE - CONTINUED
As the investment advisor for the income fund and Spartan Connecticut
Municipal Money Market Fund, FMR receives a fee that is computed daily
at an annual rate of .55% and .50% of average net assets for the
income fund and Spartan Connecticut Municipal Money Market Fund,
respectively. FMR pays all other expenses, except the compensation of
the non-interested Trustees and certain exceptions such as interest,
taxes, brokerage commissions and extraordinary expenses. The
management fee paid to FMR by the income fund and Spartan Connecticut
Municipal Money Market Fund is reduced by an amount equal to the fees
and expenses paid by each fund to the non-interested Trustees.
FMR also bears the cost of providing shareholder services to Spartan
Connecticut Municipal Money Market Fund. To offset the cost of
providing these services, FMR or its affiliates collected certain
transaction fees from shareholders which amounted to $1,485 for the
period.
SUB-ADVISER FEE. As the income fund's and money market funds'
investment sub-adviser, FIMM, a wholly owned subsidiary of FMR,
receives a fee from FMR of 50% of the management fee payable to FMR.
The fee is paid prior to any voluntary expense reimbursements which
may be in effect.
TRANSFER AGENT AND ACCOUNTING FEES. Effective June 21, 1999 Citibank,
N.A. (Citibank) replaced UMB Bank, n.a. as the custodian, transfer
agent and shareholder servicing agent for Fidelity Connecticut
Municipal Money Market Fund. Citibank has entered into a sub-contract
with Fidelity Service Company, Inc. (FSC), an affiliate of FMR, under
which FSC performs the activities associated with the fund's transfer
and shareholder servicing agent and accounting functions. The fund
pays account fees and asset-based fees that vary according to account
size and type of account. FSC pays for typesetting, printing and
mailing of all shareholder reports, except proxy statements. The
accounting fee is based on the level of average net assets for the
month plus out-of-pocket expenses.
For the period, the transfer agent fee was equivalent to an annual
rate of .13% of average net assets for Fidelity Connecticut Municipal
Money Market Fund.
MONEY MARKET INSURANCE. Pursuant to an Exemptive Order issued by the
SEC, the money market funds, along with other money market funds
advised by FMR or its affiliates, have entered into insurance
agreements with FIDFUNDS Mutual Limited (FIDFUNDS), an affiliated
mutual insurance company, effective January 1, 1999. FIDFUNDS provides
limited coverage for certain loss events including issuer default as
to payment of principal or interest and bankruptcy or insolvency of a
credit enhancement provider. The insurance does not cover losses
resulting from changes in interest rates, ratings downgrades or other
market conditions. Each money market fund may be subject to a special
assessment of up to approximately 2.5 times the fund's annual gross
premium if covered losses
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES - CONTINUED
MONEY MARKET INSURANCE - CONTINUED
exceed certain levels. Fidelity Connecticut Municipal Money Market
fund paid premiums of $18,793 to FIDFUNDS, which are being amortized
over one year. FMR has borne the cost of Spartan Connecticut Municipal
Money Market Fund's premium payable to FIDFUNDS.
5. EXPENSE REDUCTIONS.
Through arrangements with the funds' custodian and transfer agent,
credits realized as a result of uninvested cash balances were used to
reduce a portion of each fund's expenses. During the period, the
income fund's, Spartan Connecticut Municipal Money Market Fund's and
Fidelity Connecticut Municipal Money Market Fund's expenses were
reduced by $203,431, $12,933 and $35,889, respectively, under these
arrangements.
Effective January 1, 2000, FMR voluntarily agreed to reimburse
operating expenses (excluding interest, taxes, brokerage commission
and extraordinary expenses, if any) for the income fund above an
annual rate of .53% of the fund's average net assets.
REPORT OF INDEPENDENT ACCOUNTANTS
To the Trustees of Fidelity Court Street Trust and Fidelity Court
Street Trust II and the Shareholders of Spartan Connecticut Municipal
Income Fund, Spartan Connecticut Municipal Money Market Fund and
Fidelity Connecticut Municipal Money Market Fund:
In our opinion, the accompanying statements of assets and liabilities,
including the schedules of investments, and the related statements of
operations and of changes in net assets and the financial highlights
present fairly, in all material respects, the financial position of
Spartan Connecticut Municipal Income Fund (a fund of Fidelity Court
Street Trust), Spartan Connecticut Municipal Money Market Fund and
Fidelity Connecticut Municipal Money Market Fund (funds of Fidelity
Court Street Trust II) at November 30, 1999, and the results of their
operations, the changes in their net assets and the financial
highlights for the periods indicated, in conformity with generally
accepted accounting principles. These financial statements and
financial highlights (hereafter referred to as "financial statements")
are the responsibility of the funds' management; our responsibility is
to express an opinion on these financial statements based on our
audits. We conducted our audits of these financial statements in
accordance with generally accepted auditing standards which require
that we plan and perform the audit to obtain reasonable assurance
about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements,
assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement
presentation. We believe that our audits, which included confirmation
of securities at November 30, 1999 by correspondence with the
custodian and brokers, provide a reasonable basis for the opinion
expressed above.
/s/PricewaterhouseCoopers LLP
PricewaterhouseCoopers LLP
Boston, Massachusetts
January 10, 2000
PROXY VOTING RESULTS
A special meeting of Spartan Connecticut Municipal Income Fund's
shareholders was held on December 15, 1999. The results of votes taken
among shareholders on proposals before them are reported below.
PROPOSAL 1
To elect a Board of Trustees.*
# OF % OF
VOTES CAST VOTES CAST
RALPH F. COX
Affirmative 3,135,419,311.04 97.006
Withheld 96,777,025.22 2.994
TOTAL 3,232,196,336.26 100.000
PHYLLIS BURKE DAVIS
Affirmative 3,132,582,110.71 96.918
Withheld 99,614,225.55 3.082
TOTAL 3,232,196,336.26 100.000
ROBERT M. GATES
Affirmative 3,135,664,806.55 97.013
Withheld 96,531,529.71 2.987
TOTAL 3,232,196,336.26 100.000
EDWARD C. JOHNSON 3D
Affirmative 3,134,639,545.56 96.982
Withheld 97,556,790.70 3.018
TOTAL 3,232,196,336.26 100.000
DONALD J. KIRK
Affirmative 3,136,284,719.58 97.033
Withheld 95,911,616.68 2.967
TOTAL 3,232,196,336.26 100.000
PETER S. LYNCH
Affirmative 3,138,556,508.13 97.103
Withheld 93,639,828.13 2.897
TOTAL 3,232,196,336.26 100.000
# OF % OF
VOTES CAST VOTES CAST
WILLIAM O. MCCOY
Affirmative 3,136,319,971.15 97.034
Withheld 95,876,365.11 2.966
TOTAL 3,232,196,336.26 100.000
GERALD C. MCDONOUGH
Affirmative 3,128,315,051.03 96.786
Withheld 103,881,285.23 3.214
TOTAL 3,232,196,336.26 100.000
MARVIN L. MANN
Affirmative 3,136,894,405.50 97.051
Withheld 95,301,930.76 2.949
TOTAL 3,232,196,336.26 100.000
ROBERT C. POZEN
Affirmative 3,137,057,584.79 97.057
Withheld 95,138,751.47 2.943
TOTAL 3,232,196,336.26 100.000
THOMAS R. WILLIAMS
Affirmative 3,128,882,711.68 96.804
Withheld 103,313,624.58 3.196
TOTAL 3,232,196,336.26 100.000
NED C. LAUTENBACH
Affirmative 3,137,914,510.94 97.083
Withheld 94,281,825.32 2.917
TOTAL 3,232,196,336.26 100.000
PROPOSAL 2
To ratify the selection of PricewaterhouseCoopers LLP as independent
accountants of the fund.
# OF % OF
VOTES CAST VOTES CAST
Affirmative 201,248,555.98 95.314
Against 4,173,964.35 1.977
Abstain 5,719,244.36 2.709
TOTAL 211,141,764.69 100.000
PROPOSAL 3
To authorize the Trustees to adopt an Amended and Restated Declaration
of Trust.*
# OF % OF
VOTES CAST VOTES CAST
Affirmative 2,887,949,756.03 90.562
Against 150,460,756.38 4.718
Abstain 150,503,417.13 4.720
TOTAL 3,188,914,929.54 100.000
Broker Non-Votes 43,281,406.72
PROPOSAL 5
To approve an amended management contract for the fund, including a
management fee structure change.
# OF % OF
VOTES CAST VOTES CAST
Affirmative 181,558,028.01 86.834
Against 13,222,102.88 6.324
Abstain 14,306,283.91 6.842
TOTAL 209,086,414.80 100.000
Broker Non-Votes 2,055,349.89
PROPOSAL 8
To eliminate the fund's fundamental 80% investment policy and adopt a
comparable non-fundamental policy.
# OF % OF
VOTES CAST VOTES CAST
Affirmative 179,326,033.01 85.766
Against 15,874,001.04 7.593
Abstain 13,886,380.75 6.641
TOTAL 209,086,414.80 100.000
Broker Non-Votes 2,055,349.89
*DENOTES TRUST-WIDE PROPOSALS AND VOTING RESULTS.
MANAGING YOUR INVESTMENTS
Fidelity offers several ways to conveniently manage your personal
investments via your telephone or PC. You can access your account
information, conduct trades and research your investments 24 hours a
day.
BY PHONE
Fidelity Automated Service Telephone provides a single toll-free
number to access account balances, positions, quotes and trading. It's
easy to navigate the service, and on your first call, the system will
help you create a personal identification number (PIN) for security.
(PHONE_GRAPHIC)FIDELITY AUTOMATED
SERVICE TELEPHONE (FASTSM)
1-800-544-5555
PRESS
1 For mutual fund and brokerage trading.
2 For quotes.*
3 For account balances and holdings.
4 To review orders and mutual
fund activity.
5 To change your PIN.
*0 To speak to a Fidelity representative.
BY PC
Fidelity's Web site on the Internet provides a wide range of
information, including daily financial news, fund performance,
interactive planning tools and news about Fidelity products and
services.
(COMPUTER_GRAPHIC)FIDELITY'S WEB SITE
WWW.FIDELITY.COM
If you are not currently on the Internet, call EarthLink Sprint at
1-800-288-2967, and be sure to ask for registration number SMD004 to
receive a special Fidelity package that includes 30 days of free
Internet access. EarthLink is North America's #1 independent Internet
access provider.
(COMPUTER_GRAPHIC)
FIDELITY ON-LINE XPRESS+(registered trademark)
Fidelity On-line Xpress+ software for Windows combines comprehensive
portfolio management capabilities, securities trading and access to
research and analysis tools . . . all on your desktop. Call Fidelity
at 1-800-544-0240 or visit our Web site for more information on how to
manage your investments via your PC.
* WHEN YOU CALL THE QUOTES LINE, PLEASE REMEMBER THAT A FUND'S YIELD
AND RETURN WILL VARY AND,
EXCEPT FOR MONEY MARKET FUNDS, SHARE PRICE WILL ALSO VARY. THIS MEANS
THAT YOU MAY HAVE A
GAIN OR LOSS WHEN YOU SELL YOUR SHARES. THERE IS NO ASSURANCE THAT
MONEY MARKET FUNDS WILL BE
ABLE TO MAINTAIN A STABLE $1 SHARE PRICE; AN INVESTMENT IN A MONEY
MARKET FUND IS NOT INSURED
OR GUARANTEED BY THE U.S. GOVERNMENT. TOTAL RETURNS ARE HISTORICAL AND
INCLUDE CHANGES IN SHARE
PRICE, REINVESTMENT OF DIVIDENDS AND CAPITAL GAINS, AND THE EFFECTS OF
ANY SALES CHARGES.
TO WRITE FIDELITY
If more than one address is listed, please locate the address that is
closest to you. We'll give your correspondence immediate attention and
send you written confirmation upon completion of your request.
(LETTER_GRAPHIC)MAKING CHANGES
TO YOUR ACCOUNT
(such as changing name, address, bank, etc.)
Fidelity Investments
P.O. Box 770001
Cincinnati, OH 45277-0002
(LETTER_GRAPHIC)FOR NON-RETIREMENT
ACCOUNTS
BUYING SHARES
Fidelity Investments
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OVERNIGHT EXPRESS
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SELLING SHARES
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OVERNIGHT EXPRESS
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Attn: Redemptions - CP6I
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GENERAL CORRESPONDENCE
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(LETTER_GRAPHIC)FOR RETIREMENT
ACCOUNTS
BUYING SHARES
Fidelity Investments
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SELLING SHARES
Fidelity Investments
P.O. Box 660602
Dallas, TX 75266-0602
OVERNIGHT EXPRESS
Fidelity Investments
Attn: Redemptions - CP6R
400 East Colinas Blvd.
Irving, TX 75039-5587
GENERAL CORRESPONDENCE
Fidelity Investments
P.O. Box 500
Merrimack, NH 03054-0500
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INVESTMENT ADVISER
Fidelity Management & Research Company
Boston, MA
INVESTMENT SUB-ADVISER
Fidelity Investments
Money Management, Inc. (FIMM)
Merrimack, NH
OFFICERS
Edward C. Johnson 3d, President
Robert C. Pozen, Senior Vice President
Fred L. Henning, Jr., Vice President
Dwight D. Churchill, Vice President -
INCOME FUND
Boyce I. Greer, Vice President -
MONEY MARKET FUNDS
George A. Fischer, Vice President -
INCOME FUND
Scott A. Orr, Vice President -
MONEY MARKET FUNDS
Eric D. Roiter, Secretary
Richard A. Silver, Treasurer
Matthew N. Karstetter, Deputy Treasurer
Stanley N. Griffith, Assistant Vice President
John H. Costello, Assistant Treasurer
Thomas J. Simpson, Assistant Treasurer
BOARD OF TRUSTEES
Ralph F. Cox *
Phyllis Burke Davis *
Robert M. Gates *
Edward C. Johnson 3d
E. Bradley Jones *
Donald J. Kirk *
Peter S. Lynch
Marvin L. Mann *
William O. McCoy *
Gerald C. McDonough *
Robert C. Pozen
Thomas R. Williams *
* INDEPENDENT TRUSTEES
CTR-ANN-0100 88393
1.539232.102
ADVISORY BOARD
J. Gary Burkhead
Abigail P. Johnson
Ned C. Lautenbach
GENERAL DISTRIBUTOR
Fidelity Distributors Corporation
Boston, MA
TRANSFER AND SHAREHOLDER
SERVICING AGENTS
Citibank N.A.
New York NY
and
Fidelity Service Company, Inc.
Boston, MA
CUSTODIAN
Citibank N.A.
New York NY
THE FIDELITY TELEPHONE CONNECTION
MUTUAL FUND 24-HOUR SERVICE
Exchanges/Redemptions
and Account Assistance 1-800-544-6666
Product Information 1-800-544-6666
Retirement Accounts 1-800-544-4774 (8 a.m. - 9 p.m.)
TDD Service 1-800-544-0118
for the deaf and hearing impaired
(9 a.m. - 9 p.m. Eastern time)
Fidelity Automated Service
Telephone (FASTSM) 1-800-544-5555
AUTOMATED LINES FOR QUICKEST SERVICE
(2_FIDELITY_LOGOS)(registered trademark)
Corporate Headquarters
82 Devonshire St., Boston, MA 02109
www.fidelity.com
SPARTAN(REGISTERED TRADEMARK)
MUNICIPAL INCOME
FUND
ANNUAL REPORT
NOVEMBER 30, 1999
(2_FIDELITY_LOGOS)(registered trademark)
CONTENTS
PRESIDENT'S MESSAGE 3 Ned Johnson on investing
strategies.
PERFORMANCE 4 How the fund has done over
time.
FUND TALK 7 The manager's review of fund
performance, strategy and
outlook.
INVESTMENT CHANGES 10 A summary of major shifts in
the fund's investments over
the past six months.
INVESTMENTS 11 A complete list of the fund's
investments with their
market values.
FINANCIAL STATEMENTS 57 Statements of assets and
liabilities, operations, and
changes in net assets, as
well as financial highlights.
NOTES 61 Notes to the financial
statements.
REPORT OF INDEPENDENT 66 The auditors' opinion.
ACCOUNTANTS
DISTRIBUTIONS 67
PROXY VOTING RESULTS 68
Standard & Poor's, S&P and S&P 500 are registered service marks of The
McGraw-Hill Companies, Inc. and have been licensed for use by Fidelity
Distributors Corporation.
Other third party marks appearing herein are the property of their
respective owners.
All other marks appearing herein are registered or unregistered
trademarks or service marks of FMR Corp. or an affiliated company.
This report is printed on recycled paper using soy-based inks.
THIS REPORT AND THE FINANCIAL STATEMENTS CONTAINED HEREIN ARE
SUBMITTED FOR THE GENERAL INFORMATION
OF THE SHAREHOLDERS OF THE FUND. THIS REPORT IS NOT AUTHORIZED FOR
DISTRIBUTION TO PROSPECTIVE INVESTORS
IN THE FUND UNLESS PRECEDED OR ACCOMPANIED BY AN EFFECTIVE PROSPECTUS.
MUTUAL FUND SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED
BY,
ANY DEPOSITORY INSTITUTION. SHARES ARE NOT INSURED BY THE FDIC,
FEDERAL RESERVE BOARD OR ANY OTHER AGENCY, AND ARE SUBJECT TO
INVESTMENT RISKS, INCLUDING POSSIBLE LOSS OF PRINCIPAL AMOUNT
INVESTED.
NEITHER THE FUND NOR FIDELITY DISTRIBUTORS CORPORATION IS A BANK.
FOR MORE INFORMATION ON ANY FIDELITY FUND, INCLUDING CHARGES AND
EXPENSES, CALL 1-800-544-6666 FOR A
FREE PROSPECTUS. READ IT CAREFULLY BEFORE YOU INVEST OR SEND MONEY.
PRESIDENT'S MESSAGE
(PHOTO_OF_EDWARD_C_JOHNSON_3D)
DEAR SHAREHOLDER:
U.S. equity indexes once again dominated the financial headlines, led
by the NASDAQ's 15 record highs in 21 November sessions. Meanwhile,
the Standard & Poor's 500SM posted two record closings and the Dow
Jones Industrial Average crept above the 11,000 mark for the first
time since mid-September. However, another Federal Reserve Board
interest rate hike and continued inflation concerns drove down the
price of the benchmark 30-year Treasury.
While it's impossible to predict the future direction of the markets
with any degree of certainty, there are certain basic principles that
can help investors plan for their future needs.
The longer your investment time frame, the less likely it is that you
will be affected by short-term market volatility. A 10-year investment
horizon appropriate for saving for a college education, for example,
enables you to weather market cycles in a long-term fund, which may
have a higher risk potential, but also has a higher potential rate of
return.
An intermediate-length fund could make sense if your investment
horizon is two to four years, while a short-term bond fund could be
the right choice if you need your money in one or two years.
If your time horizon is less than a year, you might want to consider
moving some of your bond investment into a money market fund. These
funds seek income and a stable share price by investing in
high-quality, short-term investments. Of course, it's important to
remember that an investment in a money market fund is not insured or
guaranteed by the Federal Deposit Insurance Corporation or any other
government agency. Although money market funds seek to preserve the
value of your investment at $1.00 per share, it is possible to lose
money by investing in these types of funds.
Finally, no matter what your time horizon or portfolio diversity, it
makes good sense to follow a regular investment plan, investing a
certain amount of money in a fund at the same time each month or
quarter and periodically reviewing your overall portfolio. By doing
so, you won't get caught up in the excitement of a rapidly rising
market, nor will you buy all your shares at market highs. While this
strategy - known as dollar cost averaging - won't assure a profit or
protect you from a loss in a declining market, it should help you
lower the average cost of your purchases. Of course, you should
consider your financial ability to continue your purchases through
periods of low price levels before undertaking such a strategy.
If you have questions, please call us at 1-800-544-6666, or visit our
web site at www.fidelity.com. We are available 24 hours a day, seven
days a week to provide you the information you need to make the
investments that are right for you.
Best regards,
Edward C. Johnson 3d
PERFORMANCE: THE BOTTOM LINE
There are several ways to evaluate a fund's historical performance.
You can look at the total percentage change in value, the average
annual percentage change or the growth of a hypothetical $10,000
investment. Total return reflects the change in the value of an
investment, assuming reinvestment of the fund's dividend income and
capital gains (the profits earned upon the sale of securities that
have grown in value). You can also look at the fund's income, as
reflected in the fund's yield, to measure performance.
CUMULATIVE TOTAL RETURNS
PERIODS ENDED NOVEMBER 30, 1999 PAST 1 YEAR PAST 5 YEARS PAST 10 YEARS
SPARTAN MUNICIPAL INCOME -1.44% 42.34% 89.86%
LB Municipal Bond -1.07% 43.83% 97.77%
LB 3 Plus Year Municipal Bond -1.59% 44.68% n/a
General Municipal Debt Funds -3.51% 37.09% 85.59%
Average
CUMULATIVE TOTAL RETURNS show the fund's performance in percentage
terms over a set period - in this case, one year, five years or 10
years. For example, if you had invested $1,000 in a fund that had a 5%
return over the past year, the value of your investment would be
$1,050. You can compare the fund's returns to the performance of the
Lehman Brothers Municipal Bond Index - a market value-weighted index
of investment-grade municipal bonds with maturities of one year or
more. Beginning with this report, the fund will compare itself to the
Lehman Brothers 3 Plus Year Municipal Bond Index, a market
value-weighted index for investment-grade municipal bonds with
maturities of three years or more. To measure how the fund's
performance stacked up against its peers, you can compare it to the
general municipal debt funds average, which reflects the performance
of mutual funds with similar objectives tracked by Lipper Inc. The
past one year average represents a peer group of 264 mutual funds.
These benchmarks include reinvested dividends and capital gains, if
any, and exclude the effect of sales charges.
AVERAGE ANNUAL TOTAL RETURNS
PERIODS ENDED NOVEMBER 30, 1999 PAST 1 YEAR PAST 5 YEARS PAST 10 YEARS
SPARTAN MUNICIPAL INCOME -1.44% 7.32% 6.62%
LB Municipal Bond -1.07% 7.54% 7.06%
LB 3 Plus Year Municipal Bond -1.59% 7.67% n/a
General Municipal Debt Funds -3.51% 6.50% 6.37%
Average
AVERAGE ANNUAL TOTAL RETURNS take the fund's cumulative return and
show you what would have happened if the fund had performed at a
constant rate each year. (Note: Lipper calculates average annual total
returns by annualizing each fund's total return, then taking an
arithmetic average. This may produce a different figure than that
obtained by averaging the cumulative total returns and annualizing the
result.)
$10,000 OVER 10 YEARS
Spartan Municipal Income LB Municipal Bond
00037 LB015
1989/11/30 10000.00 10000.00
1989/12/31 10083.15 10081.80
1990/01/31 9976.90 10034.11
1990/02/28 10107.53 10123.42
1990/03/31 10118.97 10126.45
1990/04/30 9936.95 10053.14
1990/05/31 10211.13 10272.60
1990/06/30 10320.18 10362.89
1990/07/31 10479.94 10515.23
1990/08/31 10370.93 10362.55
1990/09/30 10449.17 10368.45
1990/10/31 10588.05 10556.54
1990/11/30 10890.75 10768.83
1990/12/31 10937.60 10815.67
1991/01/31 11080.06 10960.82
1991/02/28 11149.41 11056.18
1991/03/31 11185.28 11060.16
1991/04/30 11338.31 11207.26
1991/05/31 11438.17 11306.89
1991/06/30 11438.78 11295.70
1991/07/31 11604.95 11433.28
1991/08/31 11707.47 11583.86
1991/09/30 11801.05 11734.68
1991/10/31 11912.00 11840.29
1991/11/30 11938.00 11873.33
1991/12/31 12050.68 12128.13
1992/01/31 12174.38 12155.78
1992/02/29 12199.29 12159.67
1992/03/31 12211.25 12164.17
1992/04/30 12328.01 12272.43
1992/05/31 12446.33 12416.88
1992/06/30 12618.91 12625.23
1992/07/31 12942.66 13003.74
1992/08/31 12770.40 12876.95
1992/09/30 12804.68 12961.16
1992/10/31 12591.48 12833.76
1992/11/30 12918.24 13063.61
1992/12/31 13058.12 13196.99
1993/01/31 13240.87 13350.47
1993/02/28 13728.17 13833.36
1993/03/31 13628.72 13687.14
1993/04/30 13758.36 13825.24
1993/05/31 13838.21 13902.94
1993/06/30 14041.84 14134.98
1993/07/31 14046.72 14153.49
1993/08/31 14351.95 14448.17
1993/09/30 14559.51 14612.73
1993/10/31 14574.85 14640.94
1993/11/30 14457.52 14511.95
1993/12/31 14770.08 14818.30
1994/01/31 14932.52 14987.52
1994/02/28 14552.14 14599.35
1994/03/31 13878.83 14004.86
1994/04/30 13950.94 14123.62
1994/05/31 14037.88 14246.07
1994/06/30 13958.44 14159.03
1994/07/31 14221.86 14418.57
1994/08/31 14273.52 14468.45
1994/09/30 14061.47 14256.06
1994/10/31 13767.76 14002.87
1994/11/30 13338.21 13749.70
1994/12/31 13669.82 14052.33
1995/01/31 14135.82 14453.94
1995/02/28 14544.91 14874.26
1995/03/31 14583.02 15045.17
1995/04/30 14590.32 15062.92
1995/05/31 15045.38 15543.58
1995/06/30 14813.84 15408.35
1995/07/31 14921.07 15554.42
1995/08/31 15103.78 15751.65
1995/09/30 15220.32 15851.36
1995/10/31 15439.19 16081.84
1995/11/30 15731.78 16348.64
1995/12/31 15881.47 16505.75
1996/01/31 16012.98 16630.37
1996/02/29 15946.56 16518.11
1996/03/31 15742.29 16307.01
1996/04/30 15678.22 16260.86
1996/05/31 15682.37 16254.36
1996/06/30 15867.88 16431.37
1996/07/31 16017.27 16580.89
1996/08/31 16021.35 16576.91
1996/09/30 16209.32 16808.99
1996/10/31 16400.38 16999.10
1996/11/30 16736.70 17310.18
1996/12/31 16666.75 17237.48
1997/01/31 16682.99 17270.06
1997/02/28 16827.58 17428.60
1997/03/31 16609.60 17196.27
1997/04/30 16747.15 17340.21
1997/05/31 16984.12 17601.00
1997/06/30 17192.19 17788.45
1997/07/31 17681.41 18281.19
1997/08/31 17501.69 18109.90
1997/09/30 17711.93 18324.86
1997/10/31 17812.96 18442.69
1997/11/30 17911.43 18551.14
1997/12/31 18204.36 18821.80
1998/01/31 18407.86 19016.04
1998/02/28 18387.68 19021.74
1998/03/31 18389.89 19038.48
1998/04/30 18287.84 18952.62
1998/05/31 18567.48 19252.64
1998/06/30 18639.86 19328.49
1998/07/31 18685.24 19377.01
1998/08/31 18967.37 19676.38
1998/09/30 19218.95 19921.55
1998/10/31 19204.88 19921.15
1998/11/30 19262.73 19991.08
1998/12/31 19304.17 20041.45
1999/01/31 19531.67 20279.75
1999/02/28 19405.00 20191.12
1999/03/31 19437.52 20219.19
1999/04/30 19481.30 20269.54
1999/05/31 19359.42 20152.18
1999/06/30 19050.03 19861.98
1999/07/31 19127.86 19934.28
1999/08/31 18989.22 19774.81
1999/09/30 18986.51 19782.91
1999/10/31 18799.76 19568.47
1999/11/30 18986.09 19776.68
IMATRL PRASUN SHR__CHT 19991130 19991213 143826 R00000000000123
$10,000 OVER 10 YEARS: Let's say, hypothetically, that $10,000 was
invested in Spartan Municipal Income Fund on November 30, 1989. As the
chart shows, by November 30, 1999, the value of the investment would
have grown to $18,986 - an 89.86% increase on the initial investment.
For comparison, look at how the Lehman Brothers Municipal Bond Index
did over the same period. With dividends and capital gains, if any,
reinvested, the same $10,000 would have grown to $19,777 - a 97.77%
increase.
(checkmark)UNDERSTANDING
PERFORMANCE
How a fund did yesterday is
no guarantee of how it will
do tomorrow. Bond prices, for
example, generally move in
the opposite direction of
interest rates. In turn, the share
price, return and yield of a
fund that invests in bonds will
vary. That means if you sell
your shares during a market
downturn, you might lose
money. But if you can ride out
the market's ups and downs,
you may have a gain.
TOTAL RETURN COMPONENTS
YEARS ENDED NOVEMBER 30,
1999 1998 1997 1996 1995
Dividend returns 4.58% 5.00% 5.32% 5.30% 6.54%
Capital returns -6.02% 2.54% 1.70% 1.09% 11.41%
Total returns -1.44% 7.54% 7.02% 6.39% 17.95%
TOTAL RETURN COMPONENTS include both dividend returns and capital
returns. A dividend return reflects the actual dividends paid by the
fund. A capital return reflects both the amount paid by the fund to
shareholders as capital gain distributions and changes in the fund's
share price. Both returns assume the dividends or capital gains, if
any, paid by the fund are reinvested.
DIVIDENDS AND YIELD
PERIODS ENDED NOVEMBER 30, 1999 PAST 1 MONTH PAST 6 MONTHS PAST 1 YEAR
Dividends per share 4.89(cents) 29.69(cents) 59.53(cents)
Annualized dividend rate 4.92% 4.84% 4.76%
30-day annualized yield 4.91% - -
30-day annualized 7.67% - -
tax-equivalent yield
DIVIDENDS per share show the income paid by the fund for a set period.
If you annualize this number, based on an average share price of
$12.09 over the past one month, $12.23 over the past six months and
$12.51 over the past one year, you can compare the fund's income over
these three periods. The 30-day annualized YIELD is a standard formula
for all bond funds based on the yields of the bonds in the fund,
averaged over the past 30 days. This figure shows you the yield
characteristics of the fund's investments at the end of the period. It
also helps you compare funds from different companies on an equal
basis. The tax equivalent yield shows what you would have to earn on a
taxable investment to equal the fund's tax-free yield, if you're in
the 36% federal tax bracket, but does not reflect payment of the
federal alternative minimum tax, if applicable.
FUND TALK: THE MANAGER'S OVERVIEW
MARKET RECAP
Although November saw the Federal
Reserve Board levy its third 0.25%
interest-rate hike of 1999, the
municipal bond market responded
with its best single-month
performance since January. This
improvement in investor sentiment -
perhaps anticipating that the Fed's
latest rate hike would be its last for
a while - was a key contributor to
the market's improved outlook.
However, for the 12-month period
ending November 30, 1999, munis
overall dwelled in negative territory,
as the Lehman Brothers Municipal
Bond Index - an index of
approximately 50,000
investment-grade, fixed-rate,
tax-exempt bonds - declined
1.07%. A big story throughout the
year was supply, or lack thereof.
Municipal issuance fell 16.9%
through the first three quarters of
1999 compared to the same period
in 1998. Unfortunately, demand
also was tepid as the strong U.S.
economy continued to sway
investors toward higher-yielding -
and higher-risk - alternatives. Late in
the period, though, as the Fed
sought to cool down the economy
and municipal yields became more
attractive, demand showed signs of
improving. In comparison to other
bonds, munis had mixed results.
Municipal performance soundly
trounced Treasuries, as the Lehman
Brothers Long-Term Government
Bond Index fell 7.52% during the
period. Meanwhile, the Lehman
Brothers Aggregate Bond Index - a
broad measure of the taxable
bond market - posted a
marginally negative return of
- -0.04%.
(photograph of George Fischer)
An interview with George Fischer, Portfolio Manager of Spartan
Municipal Income Fund
Q. HOW DID THE FUND PERFORM, GEORGE?
A. Rising interest rates put significant pressure on bond prices,
although the fund performed better than its peers. For the 12-month
period that ended November 30, 1999, the fund had a total return of
- -1.44%. To get a sense of how the fund did relative to its
competitors, the general municipal debt funds average returned -3.51%
for the same 12-month period, according to Lipper Inc. Additionally,
the Lehman Brothers Municipal Bond Index returned -1.07%. An
additional benchmark, the Lehman Brothers 3 Plus Year Municipal Bond
Index, returned -1.59%. The fund is managed to have similar overall
interest-rate risk to the new benchmark index, which excludes
securities with maturities of less than three years and is more
representative of the fund's investment universe.
Q. WHY DID THE FUND OUTPACE ITS PEERS?
A. The main reason was the fund's defensive posture. By defensive, I'm
referring to its stake in bonds that tended to hold their value better
under adverse market conditions. First, the fund's focus on high
quality securities - over half of the fund's net assets were in bonds
rated Aaa - was a big plus. Problems with scattered lower-rated Baa
securities prompted investors to demand higher yields, causing many
Baa-rated securities to underperform higher-rated securities. The
fund's emphasis on intermediate-maturity bonds also was a plus.
Because intermediates are less interest-rate sensitive than
longer-term bonds, they outperformed their longer-term counterparts as
interest rates rose.
Q. WHAT OTHER "DEFENSIVE" TYPE OF BONDS HELD UP RELATIVELY WELL?
A. The fund had a relatively large stake in premium coupon bonds with
interest rates of 5.5% to 6.0%, which generally held up better than
lower coupon bonds. Premiums, as they are known, carry coupons higher
than prevailing interest rates and are attractive for several reasons.
First, they're more likely than discount bonds - which carry interest
rates below prevailing rates - to be advance refunded, a
refinancing-like process that generally is positive for their prices.
Second, premium bonds are somewhat protected from the unfavorable tax
treatment and price performance that can hurt discount bonds when
interest rates rise. Finally, individual investors - who account for a
significant portion of municipal bond demand - tend to shy away from
premium coupon bonds in favor of par bonds - those that carry coupons
at prevailing rates. As a result, I'm often able to buy premiums at
attractive prices relative to comparably rated par bonds with similar
maturities.
Q. WERE THERE ANY DISAPPOINTMENTS?
A. Yes, there were. Longer-maturity discount bonds proved to be some
of the market's worst performers early in the period, although the
fund had only small holdings in them. I focused on premium coupon
bonds, emphasizing intermediate-maturity bonds set to mature within
seven to 15 years. For bonds with maturities of 15 years or longer,
the extra income for each successive year was not, in my opinion,
attractive given the level of risk inherent in longer-term bonds. In
addition, the fund's stake in health care bonds detracted from
performance. Cutbacks in federally funded health care payments hurt
the health care sector as a whole. While the fund was not immune from
those troubles, it did have a smaller stake in health care bonds than
many of its peers.
Q. GEORGE, WHAT'S YOUR OUTLOOK?
A. As it usually is, the direction of interest rates will be the
primary factor that determines the municipal market's performance.
It's not clear at this point whether the Federal Reserve Board is
finished raising interest rates as it did in June, August and
November, or whether those rate hikes were just a preview of things to
come. But other factors - namely supply and demand - also will play a
role. If interest rates remain stable or move higher, I would expect
the supply of municipals to continue to taper off as issuers slow down
their refinancing and new issuance activity. We've also seen an
increase in the demand for municipal bonds as individual investors
look to lock in higher yields. To the extent that investors continue
on that course, the more municipals likely will benefit. Since
longer-maturity and lower-quality bonds have performed poorly over the
past several months, there may be opportunities to pick up
attractively priced, higher-yielding securities. But I plan to be very
selective, keeping the bulk of the fund's investments in high-quality,
intermediate-maturity bonds that I feel offer the best combination of
reward and risk.
THE VIEWS EXPRESSED IN THIS REPORT REFLECT THOSE OF THE PORTFOLIO
MANAGER ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS STATED ON
THE COVER AND DO NOT NECESSARILY REPRESENT THE VIEWS OF FIDELITY OR
ANY OTHER PERSON IN THE FIDELITY ORGANIZATION. ANY SUCH VIEWS ARE
SUBJECT TO CHANGE AT ANY TIME BASED UPON MARKET OR OTHER CONDITIONS
AND FIDELITY DISCLAIMS ANY RESPONSIBILITY TO UPDATE SUCH VIEWS. THESE
VIEWS MAY NOT BE RELIED ON AS INVESTMENT ADVICE AND, BECAUSE
INVESTMENT DECISIONS FOR A FIDELITY FUND ARE BASED ON NUMEROUS
FACTORS, MAY NOT BE RELIED ON AS AN INDICATION OF TRADING INTENT ON
BEHALF OF ANY FIDELITY FUND.
(checkmark)FUND FACTS
GOAL: a high level of income
free from federal income tax
FUND NUMBER: 037
TRADING SYMBOL: FHIGX
START DATE: December 1, 1977
SIZE: as of November 30,
1999, more than $4.2
billion
MANAGER: George Fischer,
since 1998; manager,
various Fidelity and Spartan
municipal income funds;
joined Fidelity in 1989
GEORGE FISCHER ON CHOOSING
INVESTMENTS FOR THE FUND:
"When selecting individual bonds
for inclusion in the fund, credit
research is always the starting
point. Using a very rigorous research
process - and with the help of
Fidelity's credit research team - I
look for investment-grade bonds
from issuers that have strong
underlying economics and are
well-managed. After completing
careful credit research, I then
consider structural
characteristics, such as maturity,
call features, coupons and others.
Because so much of the municipal
market is insured, it's often
challenging to add value through
credit research. So I look for
opportunities to take advantage of
pricing anomalies that creep up
due to a bond's structural
characteristics."
(solid bullet) General obligation bonds
(GOs) were the fund's largest sector
concentration throughout the
past year, making up 26.8% of net
assets at the end of the period. A
GO is backed by the full faith and
credit - which includes the taxing
power - of a city, county, state or
other issuer. GOs are repaid through
general revenues - including
individual and corporate taxes
- - collected by the issuer.
INVESTMENT CHANGES
<TABLE>
<CAPTION>
<S> <C> <C>
TOP FIVE STATES AS OF
NOVEMBER 30, 1999
% OF FUND'S NET ASSETS % OF FUND'S NET ASSETS 6
MONTHS AGO
New York 16.2 15.5
Texas 9.8 10.8
Massachusetts 7.9 7.4
Illinois 7.1 6.7
California 5.9 7.3
TOP FIVE SECTORS AS OF
NOVEMBER 30, 1999
% OF FUND'S NET ASSETS % OF FUND'S NET ASSETS 6
MONTHS AGO
General Obligations 26.8 26.8
Electric Utilities 13.7 14.2
Transportation 10.9 11.3
Health Care 10.4 7.9
Water & Sewer 9.6 7.6
AVERAGE YEARS TO MATURITY AS
OF NOVEMBER 30, 1999
6 MONTHS AGO
Years 14.2 12.9
</TABLE>
AVERAGE YEARS TO MATURITY IS BASED ON THE AVERAGE TIME REMAINING UNTIL
PRINCIPAL PAYMENTS ARE EXPECTED FROM EACH OF THE FUND'S BONDS,
WEIGHTED BY DOLLAR AMOUNT.
DURATION AS OF NOVEMBER 30,
1999
6 MONTHS AGO
Years 7.2 6.5
DURATION SHOWS HOW MUCH A BOND FUND'S PRICE FLUCTUATES WITH CHANGES IN
COMPARABLE INTEREST RATES. IF RATES RISE 1%, FOR EXAMPLE, A FUND WITH
A FIVE-YEAR DURATION IS LIKELY TO LOSE ABOUT 5% OF ITS VALUE. OTHER
FACTORS ALSO CAN INFLUENCE A BOND FUND'S PERFORMANCE AND SHARE PRICE.
ACCORDINGLY, A BOND FUND'S ACTUAL PERFORMANCE MAY DIFFER FROM THIS
EXAMPLE.
QUALITY DIVERSIFICATION
(MOODY'S RATINGS)
AS OF NOVEMBER 30, 1999
Aaa 57.1%
Aa, A 31.3%
Baa 9.3%
Ba and Below 0.0%
Not Rated 2.0%
Short-term
investments 0.3%
Row: 1, Col: 1, Value: 57.1
Row: 1, Col: 2, Value: 31.3
Row: 1, Col: 3, Value: 9.300000000000001
Row: 1, Col: 4, Value: 0.0
Row: 1, Col: 5, Value: 2.0
Row: 1, Col: 6, Value: 0.3
AS OF MAY 31, 1999
Aaa 57.3%
Aa, A 30.2%
Baa 8.8%
Ba and Below 1.1%
Not Rated 1.7%
Short-term
investments 0.9%
Row: 1, Col: 1, Value: 57.3
Row: 1, Col: 2, Value: 30.2
Row: 1, Col: 3, Value: 8.800000000000001
Row: 1, Col: 4, Value: 1.1
Row: 1, Col: 5, Value: 1.7
Row: 1, Col: 6, Value: 0.9
WHERE MOODY'S RATINGS ARE NOT AVAILABLE, WE HAVE USED S&P (registered
trademark) RATINGS. AMOUNTS SHOWN ARE AS A PERCENTAGE OF THE FUND'S
INVESTMENTS.
SPARTAN MUNICIPAL INCOME FUND
INVESTMENTS NOVEMBER 30, 1999
Showing Percentage of Net Assets
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
MUNICIPAL BONDS - 98.1%
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT (000S) VALUE (NOTE 1) (000S)
ALABAMA - 0.3%
Cullman Med. Park South Med. Baa2 $ 4,000 $ 3,938
Clinic Board Rev. Rfdg.
(Cullman Reg'l. Med. Ctr.
Proj.) Series A, 6.5% 2/15/23
Huntsville Gen. Oblig. Rfdg. Aa2 2,200 2,302
Series D, 6% 8/1/08
Mobile Wtr. & Swr. A 5,100 5,337
Commissioners Wtr. & Swr.
Rev. Rfdg. 6.5% 1/1/09
11,577
ALASKA - 1.4%
Alaska Student Ln. Corp.
Student Ln. Rev.:
(State Assisted Proj.) Series
A:
5.9% 7/1/03 (AMBAC Insured) Aaa 2,070 2,128
(g)
6% 7/1/04 (AMBAC Insured) (g) Aaa 2,500 2,566
Series A:
5.15% 7/1/05 (AMBAC Insured) Aaa 1,500 1,517
(g)
5.55% 7/1/03 (AMBAC Insured) Aaa 1,300 1,336
(g)
5.65% 7/1/04 (AMBAC Insured) Aaa 1,300 1,336
(g)
7.3% 7/1/00 (AMBAC Insured) Aaa 4,600 4,680
(g)
North Slope Borough (Cap.
Appreciation):
Series A:
0% 6/30/01 (MBIA Insured) Aaa 5,000 4,667
0% 6/30/01 (MBIA Insured) Aaa 1,400 1,307
Series B:
0% 1/1/03 (MBIA Insured) Aaa 6,000 5,202
0% 6/30/05 (FSA Insured) Aaa 4,500 3,426
Valdez Marine Term. Rev. Rfdg.:
(BP Pipeline, Inc. Proj.) Aa2 28,205 25,565
Series B, 5.5% 10/1/28
(Mobil Oil Co./Alaska Aa2 7,000 6,579
Pipeline Proj.) 5.75% 11/1/28
60,309
ARIZONA - 1.5%
Arizona Health Facilities A2 10,000 9,808
Auth. Hosp. Sys. Rev.
(Phoenix Children's Hosp.
Proj.) Series A, 6.25%
11/15/29
Arizona Student Ln. Aaa 2,000 1,962
Acquisition Auth. Student
Ln. Rev. Rfdg. Series A1,
5.9% 5/1/24 (g)
Arizona Trans. Board Hwy. Aa2 2,000 2,090
Rev. Sub-Series A, 6.25%
7/1/04 (Pre-Refunded to
7/1/00 @ 10/1/05
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT (000S) VALUE (NOTE 1) (000S)
ARIZONA - CONTINUED
Chandler Gen. Oblig. Rfdg.:
(Cap. Appreciation):
0% 7/1/05 (FGIC Insured) Aaa $ 5,700 $ 4,342
0% 7/1/08 (FGIC Insured) Aaa 1,700 1,092
7.375% 7/1/09 (FGIC Insured) Aaa 1,000 1,167
Maricopa County Cmnty. Aa1 19,000 19,153
College District Series B,
5.25% 7/1/10
Maricopa County Hosp. Rev.
Rfdg. (Sun Health Corp.
Proj.):
5.4% 4/1/05 Baa1 2,935 2,934
5.65% 4/1/06 Baa1 3,625 3,653
Maricopa County Ind. Dev. Baa1 3,345 3,217
Auth. Health Facilities Rev.
(Catholic Health Care West
Proj.) Series A, 4% 7/1/02
Maricopa County Ind. Dev. Aaa 2,000 2,302
Auth. Hosp. Facilities Rev.
Rfdg. (Samaritan Health
Svcs. Proj.) Series A, 7%
12/1/16 (MBIA Insured)
Maricopa County School Aaa 2,660 2,026
District #1 Rfdg. (Cap.
Appreciation) (Phoenix
Elementary Proj.) Second
Series, 0% 7/1/05 (MBIA
Insured)
Maricopa County Unified Aaa 3,050 2,080
School District #69 Rfdg.
(Cap. Appreciation)
(Paradise Valley Proj.)
Second Series, 0% 7/1/07
(AMBAC Insured)
Pima County Ctfs. of Prtn.:
4.75% 1/1/04 (MBIA Insured) Aaa 2,060 2,071
4.9% 1/1/06 (MBIA Insured) Aaa 2,000 2,008
Pima County Unified School Aaa 2,000 2,273
District #1 Tucson (Tucson
Proj.) Series 1989 G, 8%
7/1/04 (MBIA Insured)
62,178
ARKANSAS - 0.5%
Arkansas Dev. Fin. Auth. Rev. A 4,500 4,700
(Cap. Asset Proj.) Series B,
7.1% 3/1/08 (Pre-Refunded to
3/1/01 @ 102)
Arkansas Gen. Oblig. (Cap.
Appreciation) (College
Savings Proj.):
Series A:
0% 6/1/03 Aa3 1,280 1,093
0% 6/1/04 Aa3 1,110 900
Series C, 0% 6/1/05 Aa3 2,130 1,640
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT (000S) VALUE (NOTE 1) (000S)
ARKANSAS - CONTINUED
Little Rock Arpt. Passenger Aaa $ 1,220 $ 1,221
Facilities Charge Rev. 5.65%
5/1/16 (AMBAC Insured) (g)
North Little Rock Elec. Rev.
Rfdg. Series A:
6.15% 7/1/03 (MBIA Insured) Aaa 3,245 3,419
6.5% 7/1/10 (MBIA Insured) Aaa 3,840 4,234
Pulaski County Health Aaa 1,750 1,882
Facilities Board Rev. Rfdg.
(Sisters Charity
Nazareth-Saint Vincents
Infirmary Proj.) 6.05%
11/1/09 (MBIA Insured)
(Escrowed to Maturity) (h)
Rogers Sales & Use Tax Rev. A1 1,305 1,300
5% 11/1/15
20,389
CALIFORNIA - 5.9%
California Dept. of Wtr. Aa2 4,000 3,545
Resources Wtr. Sys. Rev.
(Wtr. Sys. Proj.) Series O,
5% 12/1/22
California Ed. Facilities
Auth. Rev.:
(Stanford Univ. Proj.) Series Aaa 10,525 9,535
N, 5.2% 12/1/27
Rfdg.:
(Stanford Univ. Proj.) Series Aaa 9,000 7,988
O, 5.125% 1/1/31
(Univ. of Southern California Aa2 4,410 3,917
Proj.) Series C, 5.125%
10/1/28
California Gen. Oblig.:
5.25% 10/1/13 Aa3 5,000 4,964
5.25% 10/1/17 Aa3 1,500 1,431
6.3% 9/1/10 Aa3 4,000 4,412
7% 10/1/09 Aa3 1,000 1,158
California Health Facilities A2 27,600 26,874
Fin. Auth. Rev.
(Cedars-Sinai Med. Ctr.
Proj.) Series A, 6.125%
12/1/30
California Hsg. Fin. Agcy.
Rev.:
(Cap. Appreciation) (Home Aa2 187 46
Mtg. Single Family Proj.)
Series 1983 A, 0% 2/1/15
(Home Mtg. Proj.):
Series B, 5.2% 8/1/26 (MBIA Aaa 3,295 3,303
Insured) (g)
Series G:
5.9% 2/1/09 (MBIA Insured) (g) Aaa 1,000 1,023
5.9% 8/1/09 (MBIA Insured) (g) Aaa 2,000 2,044
Series R, 6.15% 8/1/27 (MBIA Aaa 4,500 4,498
Insured) (g)
Rfdg. (Home Mtg. Proj.) Aaa 2,015 2,012
Series A, 5.3% 8/1/14 (MBIA
Insured)
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT (000S) VALUE (NOTE 1) (000S)
CALIFORNIA - CONTINUED
California Poll. Cont. Fing. Ba1 $ 5,235 $ 5,281
Auth. Resource Recovery Rev.
(Waste Mgmt., Inc. Proj.)
Series A, 7.15% 2/1/11 (g)
California Pub. Works Board
Lease Rev.:
(Dept. of Corrections State A1 1,500 1,423
Prison, Susanville Proj.)
Series D 5.375% 6/1/18
(Dept. of Corrections, Madera A1 2,500 2,492
State Prison Proj.) Series
E, 5.5% 6/1/15
(Substance Abuse Treatment Aaa 3,750 3,767
Facilities, Corcoran II
Proj.) Series A, 5.5% 1/1/14
(AMBAC Insured)
(Various California State A1 7,500 7,374
Univ. Proj.) Series A, 5.25%
12/1/13
Rfdg.:
(California Cmnty. Colleges
Proj.) Series D:
5.375% 3/1/11 A 3,000 3,009
5.375% 3/1/12 A 1,500 1,493
(California State Univ. A1 5,755 5,783
Proj.) Series A, 5.5% 10/1/13
(Dept. of Corrections State A1 2,500 2,488
Prison, Monterey County
Proj.) Series D, 5.375%
11/1/13
(State Archives Bldg. Complex A1 5,000 5,081
Proj.) Series A, 5.375%
12/1/10
California Statewide Cmnty. Aaa 3,695 3,276
Dev. Corp. Ctfs. of Prtn.
(J. Paul Getty Trust Co.
Proj.) 5% 10/1/23
California Univ. Rev. 5.875% Aaa 9,775 9,630
11/1/30 (FGIC Insured)
Castaic Lake Wtr. Agcy. Ctfs.
of Prtn. Rfdg. (Wtr. Sys.
Impt. Proj.) Series A:
7% 8/1/11 (MBIA Insured) Aaa 1,475 1,710
7.25% 8/1/09 (MBIA Insured) Aaa 1,800 2,106
Chino Basin Reg'l. Fing. Aaa 2,245 2,585
Auth. Rev. Rfdg. (Muni.
Wtr. District Swr. Sys.
Proj.) 7% 8/1/09 (AMBAC
Insured)
Compton Cmnty. Redev. Agcy. Aaa 4,000 4,346
Rfdg. (Tax
Allocation-Compton Redev.
Proj.) Series A, 6.5%
8/1/13 (FSA Insured)
Foothill/Eastern Trans. Baa3 8,000 6,410
Corridor Agcy. Toll Road
Rev. (Cap. Appreciation) Sr.
Lein Series A, 0% 1/1/08
(Escrowed to Maturity) (b)(h)
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT (000S) VALUE (NOTE 1) (000S)
CALIFORNIA - CONTINUED
La Quinta Redev. Agcy. Tax. Aaa $ 470 $ 561
Allocation Rfdg. (Area
#1Redev. Proj.) 7.3% 9/1/12
(MBIA Insured)
Long Beach Hbr. Rev.:
Rfdg. Series A, 6% 5/15/13 Aaa 6,700 7,053
(FGIC Insured) (g)
5.125% 5/15/18 (g) Aa3 5,000 4,535
Los Angeles County Metro. Aaa 4,355 4,345
Trans. Auth. Rev. Rfdg.
(Gen. Union Station Proj.)
Series A, 5.2% 7/1/12 (FSA
Insured)
Los Angeles County Pub. Works Aaa 5,145 5,010
Fing. Auth. Lease Rev.
(Multiple Cap. Facilities #4
Proj.) 4.75% 12/1/10 (MBIA
Insured)
Los Angeles Dept. Wtr. & Pwr. Aaa 23,000 23,338
Wtrwks. Rev. 6.1% 10/15/39
(FGIC Insured)
Los Angeles Wastewtr. Sys. Aaa 4,735 4,115
Rev. 5% 6/1/28 (FGIC Insured)
M-S-R Pub. Pwr. Agcy. San Aaa 1,685 1,771
Juan Proj. Rev. Series E,
6.5% 7/1/05 (MBIA Insured)
Modesto Irrigation District Aaa 4,390 5,584
Elec. Rev. Series A, 9.625%
1/1/11 (Escrowed to
Maturity) (h)
Placer County Wtr. Agcy. Rev.
(Middle Fork Proj.) Series A:
3.75% 7/1/12 A+ 7,820 7,064
3.75% 1/1/13 A+ 1,500 1,296
Sacramento Cogeneration Auth. BBB- 700 735
Cogeneration Proj. Rev.
(Procter & Gamble Proj.)
6.375% 7/1/10
Sacramento Pwr. Auth.
Cogeneration Proj. Rev.:
6.5% 7/1/07 BBB- 1,000 1,077
6.5% 7/1/09 BBB- 2,200 2,355
San Francisco Bldg. Auth. A1 5,500 5,301
Lease Rev. (Dept. Gen. Svcs.
Lease Proj.) Series A, 5%
10/1/13
San Francisco City & County
Arpt. Commission Int'l.
Arpt. Rev. Second Series
Issue 10 A:
5.5% 5/1/13 (MBIA Insured) (g) Aaa 5,955 5,947
5.55% 5/1/14 (MBIA Insured) Aaa 5,875 5,839
(g)
Santa Clara Redev. Agcy. Tax Aaa 4,000 4,582
Allocation Rfdg. (Bayshore
North Proj.) 7% 7/1/10
(AMBAC Insured)
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT (000S) VALUE (NOTE 1) (000S)
CALIFORNIA - CONTINUED
Santa Margarita/Dana Point Aaa $ 1,045 $ 1,224
Auth. Rev. (Impt. Dists.
1&2-2A&8 Proj.) Series A,
7.25% 8/1/10 (MBIA Insured)
Santa Rosa Wastewtr. Rev. Aaa 3,900 3,518
(Rfdg. & SubReg'l. Wastewtr.
Proj.) Series A, 4.75%
9/1/16 (FGIC Insured)
South Orange County Pub.
Fing. Auth. Spl. Tax Rev.:
(Foothill Area Proj.) Series Aaa 2,500 3,046
C, 8% 8/15/08 (FGIC Insured)
Sr. Lien Series A, 7% 9/1/11 Aaa 3,490 4,049
(MBIA Insured)
247,349
COLORADO - 3.8%
Adams County School District Aaa 1,000 1,039
#12 Rfdg. 6.2% 12/15/10
(FGIC Insured)
Arapaho County Cap. Impt.
Trust Fund Hwy. Rev. (Cap.
Appreciation):
Series C:
0% 8/31/15 (Pre-Refunded to Aaa 16,000 5,851
8/31/05 @ 48.6181) (h)
0% 8/31/26 (Pre-Refunded to Aaa 314,505 49,352
8/31/05 @ 20.8626) (h)
Series E 470, 0% 8/31/10 Aaa 15,000 8,061
(Pre-Refunded to 8/31/05 @
71.4501) (h)
Colorado Health Facilities
Auth. Rev. Rfdg. (Rocky
Mountain Adventist Proj.):
6.25% 2/1/04 Ba1 2,100 2,024
6.625% 2/1/13 Ba1 28,100 26,405
6.625% 2/1/22 Ba1 11,600 10,595
Colorado Springs Arpt. Rev.
(Cap. Appreciation) Series C:
0% 1/1/02 (MBIA Insured) Aaa 1,550 1,414
0% 1/1/04 (MBIA Insured) Aaa 1,530 1,261
0% 1/1/06 (MBIA Insured) Aaa 250 186
0% 1/1/09 (MBIA Insured) Aaa 1,655 1,036
0% 1/1/10 (MBIA Insured) Aaa 1,500 886
Colorado Univ. Rev. A2 5,725 6,077
(Biomedical Research Bldg.
Proj.) 7% 6/1/09
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT (000S) VALUE (NOTE 1) (000S)
COLORADO - CONTINUED
Denver City & County Arpt.
Rev.:
(Cap. Appreciation):
Series A:
0% 11/15/02 (MBIA Insured) (g) Aaa $ 4,900 $ 4,295
0% 11/15/05 (MBIA Insured) (g) Aaa 4,480 3,342
Series D:
0% 11/15/03 (MBIA Insured) (g) Aaa 5,000 4,149
0% 11/15/04 (MBIA Insured) (g) Aaa 7,500 5,904
0% 11/15/05 (MBIA Insured) (g) Aaa 3,000 2,238
Series B, 7.25% 11/15/23 (g) Baa1 1,870 1,998
Series C:
6.5% 11/15/06 (g) Baa1 4,075 4,263
6.55% 11/15/02 (g) Baa1 4,000 4,142
Series D:
7% 11/15/25 (g) Baa1 6,980 7,197
7.4% 11/15/01 (g) Baa1 3,000 3,130
El Paso County School Aaa 2,600 1,673
District #20 Rfdg. (Cap.
Appreciation) Series A, 0%
6/15/08 (AMBAC Insured)
Highlands Ranch Metro.
District #2 Rfdg.:
6.5% 6/15/10 (FSA Insured) Aaa 1,000 1,104
6.5% 6/15/12 (FSA Insured) Aaa 1,000 1,103
Jefferson County Ctfs. of Aaa 3,000 3,196
Prtn. Rfdg. 6.65% 12/1/08
(MBIA Insured)
161,921
CONNECTICUT - 0.3%
Connecticut Health & Edl.
Facilities Auth. Rev.:
(New Britain Memorial Hosp. AAA 3,600 3,847
Proj.) Series A, 7.5% 7/1/06
(Pre-Refunded to 7/1/02 @
102) (h)
(Saint Raphael Hosp. Proj.) Aaa 3,035 3,012
Series H, 5.25% 7/1/12
(AMBAC Insured)
Rfdg. (Quinnipiac College
Proj.) Series D:
6% 7/1/13 BBB- 550 546
6% 7/1/13 (Pre-Refunded to BBB- 700 744
7/1/03 @ 102) (h)
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT (000S) VALUE (NOTE 1) (000S)
CONNECTICUT - CONTINUED
Connecticut Resources Aaa $ 2,100 $ 2,125
Recovery Auth. Rfdg.
(Mid-Connecticut Sys. Proj.)
Series A, 5.375% 11/15/10
(MBIA Insured)
Eastern Connecticut Resources BBB 900 854
Recovery Auth. Solid Waste
Rev. (Wheelabrator Lisbon
Proj.) Series A, 5% 1/1/04
(g)
11,128
DISTRICT OF COLUMBIA - 2.5%
District of Columbia Gen.
Oblig.:
Rfdg.:
Series A:
5.625% 6/1/02 (MBIA Insured) Aaa 760 779
5.625% 6/1/02 (MBIA Insured) Aaa 740 760
(Escrowed to Maturity) (h)
5.875% 6/1/05 (AMBAC Insured) Aaa 1,770 1,852
5.875% 6/1/05 (AMBAC Insured) Aaa 1,915 2,016
(Escrowed to Maturity) (h)
5.875% 6/1/05 (MBIA Insured) Aaa 1,530 1,601
5.875% 6/1/05 (MBIA Insured) Aaa 1,470 1,548
(Escrowed to Maturity) (h)
6% 6/1/05 (AMBAC Insured) Aaa 3,695 3,912
(Escrowed to Maturity) (h)
Series A1, 6% 6/1/11 (MBIA Aaa 2,850 3,004
Insured)
Series A3:
5.3% 6/1/04 (AMBAC Insured) Aaa 1,605 1,636
5.3% 6/1/04 (AMBAC Insured) Aaa 1,505 1,543
(Escrowed to Maturity) (h)
5.4% 6/1/05 (AMBAC Insured) Aaa 1,510 1,546
5.4% 6/1/05 (AMBAC Insured) Aaa 1,400 1,442
(Escrowed to Maturity) (h)
Series B, 5.25% 6/1/07 (MBIA Aaa 15,000 15,138
Insured)
Series B3, 5.3% 6/1/05 (MBIA Aaa 5,000 5,094
Insured)
Series C:
5.25% 12/1/03 (FGIC Insured) Aaa 205 209
5.25% 12/1/03 (FGIC Insured) Aaa 1,965 2,013
(Escrowed to Maturity) (h)
Series A:
5% 6/1/06 (MBIA Insured) Aaa 4,855 4,854
5% 6/1/06 (MBIA Insured) Aaa 2,545 2,563
(Escrowed to Maturity) (h)
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT (000S) VALUE (NOTE 1) (000S)
DISTRICT OF COLUMBIA -
CONTINUED
District of Columbia Gen.
Oblig.: - continued
Series B:
5% 6/1/06 (MBIA Insured) Aaa $ 8,015 $ 8,014
5% 6/1/06 (MBIA Insured) Aaa 4,210 4,240
(Escrowed to Maturity) (h)
Series E:
5% 6/1/04 (FGIC Insured) Aaa 965 972
5% 6/1/04 (FGIC Insured) Aaa 35 36
(Pre-Refunded to 6/1/03 @
102) (h)
District of Columbia Hosp. - 11,640 12,125
Rev. (Hosp. for Sick
Children Proj.) Series A,
8.875% 1/1/21
District of Columbia Redev.
Land Agcy. Washington D.C.
Sports Arena Spl. Tax Rev.:
5.4% 11/1/00 Baa 1,000 1,007
5.625% 11/1/10 Baa 7,165 7,248
District of Columbia Rev.
Rfdg. (Georgetown Univ.
Proj.) Series A:
5.95% 4/1/14 (MBIA Insured) Aaa 2,000 2,044
6% 4/1/18 (MBIA Insured) Aaa 13,835 13,965
Metro. Washington Arpt. Auth. Aaa 3,000 3,117
Gen. Arpt. Rev. Series A,
7.25% 10/1/10 (FGIC Insured)
(g)
104,278
FLORIDA - 2.9%
Broward County Resource A3 14,440 14,909
Recovery Rev. (SES Broward
Co. LP South Proj.) 7.95%
12/1/08
Dade County Aviation Rev. Aaa 3,750 3,764
(Miami Int'l Arpt. Proj.)
Series B, 6% 10/1/24 (MBIA
Insured) (g)
Florida Board of Ed. Cap. Aa2 21,300 20,646
Outlay Rfdg. (Pub. Ed.
Proj.) Series D, 5.75%
6/1/22 (c)
Florida Muni. Pwr. Agcy. Rev. Aaa 3,000 2,566
Rfdg. (Stanton II Proj.)
4.5% 10/1/16 (AMBAC Insured)
Greater Orlando Aviation Aaa 4,000 3,991
Auth. Orlando Arpt.
Facilities Rev. Series A,
5.25% 10/1/10 (FGIC
Insured) (g)
Jacksonville Elec. Auth. Rev.:
(First Installment Proj.) 6% Aaa 2,130 2,147
7/1/01 (Escrowed to
Maturity) (h)
(Third Installment Proj.) Aaa 3,000 3,267
Series 73, 6.8% 7/1/12
(Escrowed to Maturity) (h)
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT (000S) VALUE (NOTE 1) (000S)
FLORIDA - CONTINUED
Jacksonville Elec. Auth.
Rev.: - continued
Rfdg. (Saint Johns River Pwr. Aa2 $ 4,535 $ 4,371
Park Sys. Proj.) Issue 2 13,
5.375% 10/1/16
Jacksonville Health Baa1 2,000 2,097
Facilities Auth. Ind. Dev.
Rev. Rfdg. (Cypress Village
Proj./Nat'l. Benevolent
Assoc. Proj.) 7% 12/1/22
Jacksonville Port Auth. Rev.
Rfdg.:
5.5% 11/1/06 (MBIA Insured) Aaa 8,630 8,909
(g)
5.75% 11/1/09 (MBIA Insured) Aaa 1,000 1,040
(g)
Miami Beach Health Facilities BBB 7,540 6,058
Auth. Hosp. Rev. (Mount
Sinai Med. Ctr. of Florida
Proj.) 5.375% 11/15/28
Miami-Dade County Edl. Aaa 10,000 9,779
Facilities Auth. Rev. Series
A, 5.75% 4/1/29 (AMBAC
Insured)
Orlando Util. Commission Wtr. Aa2 5,465 4,980
& Elec. Rev. Series B, 5.25%
10/1/23
Pasco County Solid Waste
Disp. & Resource Recovery
Sys. Rev. Rfdg.:
6% 4/1/08 (AMBAC Insured) (g) Aaa 5,000 5,292
6% 4/1/09 (AMBAC Insured) (g) Aaa 8,090 8,541
Pinellas County Resource Aaa 4,010 4,091
Recovery Rev. 5.25% 10/1/05
(MBIA Insured) (g)
Tampa Bay Wtr. Util. Sys. Aaa 6,000 6,114
Rev. 6% 10/1/24 (FGIC
Insured)
Tampa Wtr. & Swr. Rev. 5.5% Aa3 10,000 9,388
10/1/29
121,950
GEORGIA - 2.6%
Atlanta & Fulton County Aaa 6,000 5,621
Resource Auth. Rev. Rfdg.
(Downtown Area Pub. Impt.
Proj.) Series A, 5.375%
12/1/21 (MBIA Insured)
Atlanta Arpt. Facilities Rev. Aaa 16,820 17,956
Rfdg. 6.25% 1/1/05 (AMBAC
Insured)
Atlanta Downtown Dev. Auth.
Rev. Rfdg. (Underground
Atlanta Proj.):
6.25% 10/1/12 Aa3 3,750 3,934
6.25% 10/1/16 Aa3 3,000 3,106
Atlanta Wtr. & Swr. Rev.:
Second Lien 5.375% 1/1/20 Aaa 4,750 4,911
(FGIC Insured) (Pre-Refunded
to 1/1/07 @ 101) (h)
5.25% 1/1/27 (FGIC Insured) Aaa 33,050 33,928
(Pre-Refunded to 1/1/07 @
101) (h)
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT (000S) VALUE (NOTE 1) (000S)
GEORGIA - CONTINUED
Atlanta Wtr. & Wastewtr. Rev. Aaa $ 7,200 $ 7,381
Rfdg. Series A, 5.5% 11/1/10
(FGIC Insured)
Dalton Util. Rev.:
6% 1/1/11 (FSA Insured) Aaa 3,000 3,196
6% 1/1/12 (FSA Insured) Aaa 1,700 1,803
Fulton County School District Aa2 4,500 4,887
Rfdg. 6.375% 5/1/14
Fulton County Wtr. & Swr. Aaa 140 151
Rev. Rfdg. 6.375% 1/1/14
(FGIC Insured)
Georgia Gen. Oblig.:
Series B, 5.75% 8/1/10 Aaa 8,740 9,213
Series C, 5.75% 9/1/10 Aaa 5,000 5,272
Georgia Muni. Elec. Auth.
Pwr. Rev.:
Rfdg. Series Z, 5.5% 1/1/12 A 2,000 2,008
Series B, 6.2% 1/1/10 (AMBAC Aaa 5,000 5,423
Insured)
108,790
HAWAII - 0.4%
Hawaii Arpt. Sys. Rev. Second
Series:
7.5% 7/1/05 (FGIC Insured) (g) Aaa 1,000 1,039
7.5% 7/1/20 (FGIC Insured) (g) Aaa 1,500 1,554
Hawaii Gen. Oblig. Series CN, Aaa 7,000 6,848
5.25% 3/1/12 (FGIC Insured)
Hawaii Hsg. Fin. & Dev. Corp. Aa1 6,730 6,549
Series A, 4.9% 7/1/28 (g)
15,990
IDAHO - 0.3%
Boise City Urban Renewal Aaa 10,000 9,808
Agcy. Lease Rev. 5.9%
8/15/29 (AMBAC Insured) (c)
Idaho Falls Gen. Oblig. Rfdg.:
0% 4/1/06 (FGIC Insured) Aaa 2,000 1,461
0% 4/1/07 (FGIC Insured) Aaa 2,500 1,725
12,994
ILLINOIS - 7.1%
Chicago Board of Ed. (Chicago
School Reform Proj.):
5.75% 12/1/20 (AMBAC Insured) Aaa 3,480 3,393
5.75% 12/1/27 (AMBAC Insured) Aaa 47,000 45,234
6.25% 12/1/11 (MBIA Insured) Aaa 1,000 1,080
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT (000S) VALUE (NOTE 1) (000S)
ILLINOIS - CONTINUED
Chicago Gen. Oblig.:
Rfdg.:
Series A2:
6.125% 1/1/12 (AMBAC Insured) Aaa $ 10,000 $ 10,661
6.25% 1/1/15 (AMBAC Insured) Aaa 4,885 5,214
Series B, 5% 1/1/11 (AMBAC Aaa 2,200 2,141
Insured)
Series 1993, 5.25% 1/1/18 Aaa 7,200 6,637
(FGIC Insured)
Chicago Midway Arpt. Rev.:
Series A, 5.5% 1/1/29 (MBIA Aaa 24,775 22,952
Insured)
Series B:
5.25% 1/1/13 (MBIA Insured) Aaa 2,910 2,784
(g)
5.25% 1/1/14 (MBIA Insured) Aaa 3,060 2,910
(g)
6% 1/1/05 (MBIA Insured) (g) Aaa 1,360 1,425
6% 1/1/08 (MBIA Insured) (g) Aaa 2,170 2,276
6% 1/1/10 (MBIA Insured) (g) Aaa 2,435 2,532
6.125% 1/1/11 (MBIA Insured) Aaa 2,580 2,680
(g)
Chicago Motor Fuel Tax Rfdg. Aaa 4,600 4,525
Series A, 5.375% 1/1/14
(AMBAC Insured)
Chicago O'Hare Int'l. Arpt.
Rev.:
(Passenger Facility Charge Aaa 4,500 4,579
Proj.) Series A, 5.6% 1/1/10
(AMBAC Insured)
Rfdg. (Gen. Arpt. Proj.)
Second Lien Series A:
5.5% 1/1/16 (AMBAC Insured) Aaa 10,000 9,595
(g)
6.25% 1/1/09 (AMBAC Insured) Aaa 6,730 7,167
(g)
6.375% 1/1/12 (MBIA Insured) Aaa 4,000 4,275
6.375% 1/1/15 (MBIA Insured) Aaa 14,900 15,548
Chicago O'Hare Int'l. Arpt. A 4,500 4,601
Spl. Facilities Rev. (Int'l.
Term. Proj.) Series A, 7.5%
1/1/17 (MBIA Insured)
(Pre-Refunded to 1/1/00 @
102) (g)(h)
Chicago Residential Mtg. Rev. Aaa 4,215 2,133
Rfdg. (Cap. Appreciation)
Series B, 0% 10/1/09 (MBIA
Insured)
Chicago Sales Tax Rev. 5.375% Aaa 18,000 16,280
1/1/30 (FGIC Insured)
Chicago Wastewtr. Aaa 4,500 4,467
Transmission Rev. Rfdg.
5.375% 1/1/13 (FGIC Insured)
Chicago Wtr. Rev. Rfdg. (Cap. Aaa 1,960 1,802
Appreciation) 0% 11/1/01
(FGIC Insured)
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT (000S) VALUE (NOTE 1) (000S)
ILLINOIS - CONTINUED
Cook & Will Counties Township Aaa $ 2,350 $ 1,946
High School District #206
(Cap. Appreciation) Series
A, 0% 12/1/03 (AMBAC
Insured) (Escrowed to
Maturity) (h)
De Kalb Single Family Mtg. Aaa 835 866
Rev. Series A, 7.45% 12/1/09
(g)
Illinois Dedicated Tax Rev. Aaa 695 730
(Civic Ctr. Proj.) Series
A, 7% 12/15/13 (AMBAC
Insured) (Pre-Refunded to
12/15/00 @ 102) (h)
Illinois Dev. Fin. Auth. Aaa 7,000 7,550
Poll. Cont. Rev. Rfdg.
(Commerce Edison Co. Proj.)
Series D, 6.75% 3/1/15
(AMBAC Insured)
Illinois Health Facilities
Auth. Rev.:
(Franciscan Proj.) Series A, Aaa 15,200 9,448
0% 9/1/05 (MBIA Insured)
(Pre-Refunded to 9/1/00 @
64.513) (h)
(GlenOaks Med. Ctr. Proj.) Baa 3,105 3,297
Series D, 9.5% 11/15/15
(Escrowed to Maturity) (h)
(Memorial Hosp. Proj.):
6.875% 5/1/00 (Escrowed to - 300 301
Maturity) (h)
7.125% 5/1/10 (Pre-Refunded - 4,000 4,313
to 5/1/02 @ 102) (h)
(Methodist Health Svcs. Co. Aaa 7,000 7,354
Proj.) 6.903% 5/18/21 (AMBAC
Insured) (Pre-Refunded to
5/8/01 @ 102) (h)
Rfdg.:
(Lutheran Gen. Health Care
Sys. Proj.) Series C:
6% 4/1/18 A1 3,000 2,973
7% 4/1/14 A1 1,500 1,659
(OSF Health Care Sys. Proj.) A2 7,000 6,855
6% 11/15/13
(Swedish American Hosp. Aaa 3,000 2,929
Proj.) 5.375% 11/15/13
(AMBAC Insured)
Illinois Reg'l. Trans. Auth.:
Series A, 8% 6/1/17 (AMBAC Aaa 4,500 5,591
Insured)
Series C, 7.75% 6/1/13 (FGIC Aaa 2,045 2,486
Insured)
Series D, 7.75% 6/1/04 (FGIC Aaa 1,115 1,250
Insured)
Lake County Forest
Preservation District (Cap.
Appreciation):
0% 12/1/07 Aa1 10,440 6,907
0% 12/1/08 Aa1 12,505 7,803
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT (000S) VALUE (NOTE 1) (000S)
ILLINOIS - CONTINUED
Metro. Pier & Exposition
Auth. Dedicated Tax Rev.:
(Cap. Appreciation):
(McCormick Place Expansion Aaa $ 250 $ 223
Proj.) Series A, 0% 6/15/12
(FGIC Insured) (b)
Series A:
0% 6/15/08 (MBIA Insured) Aaa 3,335 2,140
(Escrowed to Maturity) (h)
0% 6/15/09 (FGIC Insured) Aaa 14,850 8,933
0% 6/15/09 (FGIC Insured) Aaa 2,325 1,409
(Escrowed to Maturity) (h)
(McCormick Place Expansion
Proj.) Series A:
0% 6/15/10 (FGIC Insured) Aaa 17,000 9,588
5.25% 12/15/10 (AMBAC Insured) Aaa 14,450 14,441
Rfdg. (McCormick Place Aaa 3,820 2,442
Expansion Proj.) Series A,
0% 6/15/08 (MBIA Insured)
Northern Illinois Univ. Revs. Aaa 1,000 1,035
(Auxiliary Facilities Sys.
Proj.) 6% 4/1/02 (FGIC
Insured)
301,360
INDIANA - 0.2%
Indiana Bond Bank Rev. (State AAA 2,000 2,204
Revolving Fund Prog. Proj.)
Series A, 7% 2/1/05
Indiana Health Facilities Aaa 2,500 2,839
Fing. Auth. Hosp. Rev. Rfdg.
(Columbus Reg'l. Hosp.
Proj.) 7% 8/15/15 (FSA
Insured)
Indianapolis Arpt. Auth. Rev. Aaa 1,000 1,001
Rfdg. Series A, 5.6% 7/1/15
(FGIC Insured)
Indianapolis Econ. Dev. Rev. Baa2 3,000 3,171
Rfdg. & Impt. (Nat'l.
Benevolent Assoc. Proj.)
7.625% 10/1/22
9,215
KANSAS - 0.5%
Johnson County Unified School
District #512 (Shawnee
Mission Proj.):
8% 10/1/03 Aa1 1,015 1,137
8% 10/1/04 Aa1 1,225 1,401
8% 10/1/05 Aa1 1,250 1,456
Kansas City Util. Sys. Rev.
(Cap. Appreciation):
0% 3/1/09 (AMBAC Insured) Aaa 3,975 2,446
(Escrowed to Maturity) (h)
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT (000S) VALUE (NOTE 1) (000S)
KANSAS - CONTINUED
Kansas City Util. Sys. Rev.
(Cap. Appreciation): -
continued
0% 9/1/10 (AMBAC Insured) Aaa $ 2,865 $ 1,642
0% 9/1/10 (AMBAC Insured) Aaa 3,825 2,164
(Escrowed to Maturity) (h)
Kansas Dept. Trans. Hwy. Rev. Aa 4,750 5,308
7.25% 3/1/05
Wichita Hosp. Rev. Series Aaa 6,000 6,297
III-A, 6.465% 10/20/17 (MBIA
Insured)
21,851
KENTUCKY - 0.6%
Jefferson County Cap. Projs. A1 5,250 2,779
Corp. Rev. (Cap.
Appreciation) Series A, 0%
8/15/11
Jefferson County Hosp. Rev.
(Alliant Health Sys. Proj.):
6.367% 10/9/08 (MBIA Insured) Aaa 1,800 1,904
6.367% 10/9/08 (MBIA Insured) Aaa 2,200 2,355
(Pre-Refunded to 10/29/02 @
102) (h)
Kenton County Arpt. Board
Arpt. Rev.:
Rfdg. (Cincinnati/Northern Aaa 1,480 1,527
Kentucky Int'l. Arpt. Proj.)
5.65% 3/1/04 (MBIA Insured)
(g)
Spl. Facilities (Delta Air Baa3 5,100 5,371
Lines, Inc. Proj.) Series
A, 7.5% 2/1/20 (g)
Owensboro Elec. Lt. & Pwr.
Rev. Series B:
0% 1/1/07 (AMBAC Insured) Aaa 10,000 7,008
0% 1/1/08 (AMBAC Insured) Aaa 600 398
0% 1/1/09 (AMBAC Insured) Aaa 2,000 1,247
0% 1/1/10 (AMBAC Insured) Aaa 8,440 4,981
27,570
LOUISIANA - 0.4%
Louisiana Gen. Oblig. Series Aaa 2,000 2,164
A, 6.75% 5/15/04 (MBIA
Insured)
Louisiana Offshore Term. Baa1 1,205 1,259
Auth. Deep Wtr. Port Rev.
Series E, 7.6% 9/1/10
(Pre-Refunded to 9/1/00 @
102) (h)
Monroe-West Monroe Pub. Trust AA- 9,000 3,818
Fing. Auth. Mtg. Rev. Rfdg.
(Cap. Appreciation) Series
C, 0% 8/20/14
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT (000S) VALUE (NOTE 1) (000S)
LOUISIANA - CONTINUED
New Orleans Gen. Oblig. Rfdg.
(Cap. Appreciation):
0% 9/1/08 (AMBAC Insured) Aaa $ 10,000 $ 6,365
0% 9/1/09 (AMBAC Insured) Aaa 3,000 1,805
Saint John Baptist Parish Baa 2,700 2,781
Sales Tax District Rfdg.
Series 1989, 7.8% 12/1/14
(Pre-Refunded to 12/1/99 @
103) (h)
18,192
MARYLAND - 0.6%
Baltimore Gen. Oblig. Rfdg. Aaa 5,100 5,748
(Cons. Pub. Impt.) Series A,
7.25% 10/15/05 (FGIC Insured)
Howard County Mtg. Rev. Aaa 250 259
(Heartland Elderly Apts.
Proj.) 8.875% 12/1/10 (MBIA
Insured)
Marshall County Poll. Cont. Aa2 3,000 2,868
Rev. Rfdg. (John Hopkins
Univ. Proj.) 5.25% 7/1/16
Maryland Cmnty. Dev. Aa2 2,450 2,433
Administration Dept. Rfdg.
(Residential Proj.) Series
B, 5.05% 9/1/19 (g)
Maryland Health & Higher Edl.
Facilities Auth. Rev.:
(Good Samaritan Hosp. Proj.):
5.75% 7/1/13 (AMBAC Insured) Aaa 995 1,016
(Escrowed to Maturity) (h)
5.75% 7/1/13 (Escrowed to A1 1,605 1,653
Maturity) (h)
Rfdg. (John Hopkins Univ. Aa2 2,500 2,373
Proj.) 5.25% 7/1/17
Montgomery County Gen. Oblig. Aaa 2,250 2,268
(Consolidated Pub. Impt.
Proj.) Series A, 5.375%
5/1/12
Prince Georges County Solid Aaa 1,500 1,470
Waste Mgmt. Sys. Rev. 5.25%
6/15/13 (FSA Insured)
Washington D.C. Metro. Area Aaa 5,500 5,783
Trans. Auth. Gross Rev.
Rfdg. 6% 7/1/09 (FGIC
Insured)
25,871
MASSACHUSETTS - 7.9%
Boston Metro. District Gen. Aaa 1,260 1,415
Oblig. Rfdg. 8% 12/1/03
(MBIA Insured)
Massachusetts Bay Trans. Auth.:
(Massachusetts Trans. Sys. Aa3 15,000 14,097
Proj.) Series A, 5.375%
3/1/19
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT (000S) VALUE (NOTE 1) (000S)
MASSACHUSETTS - CONTINUED
Massachusetts Bay Trans.
Auth.: - continued
Rfdg. (Gen. Trans. Sys. Proj.):
Series A:
5.5% 3/1/12 Aa3 $ 5,000 $ 5,079
6.25% 3/1/12 Aa3 2,000 2,169
Series B, 6.2% 3/1/16 Aa3 3,800 3,992
5.25% 3/1/26 (FSA Insured) Aaa 14,750 13,241
Massachusetts Ed. Ln. Auth.
Ed. Ln. Rev. Series B Issue E:
5.75% 7/1/05 (AMBAC Insured) Aaa 2,375 2,462
(g)
5.85% 7/1/06 (AMBAC Insured) Aaa 2,825 2,945
(g)
5.95% 7/1/07 (AMBAC Insured) Aaa 3,060 3,189
(g)
6.05% 7/1/08 (AMBAC Insured) Aaa 3,165 3,298
(g)
6.15% 7/1/10 (AMBAC Insured) Aaa 1,270 1,321
(g)
6.25% 7/1/11 (AMBAC Insured) Aaa 765 798
(g)
6.3% 7/1/12 (AMBAC Insured) Aaa 770 801
(g)
Massachusetts Edl. Fing. AAA 6,535 6,131
Auth. Ed. Ln. Rev. 4.9%
7/1/13 (AMBAC Insured) (g)
Massachusetts Gen. Oblig.:
(Consolidated Ln. Proj.):
Series A, 7.5% 6/1/04 Aa3 3,270 3,567
Series B, 4.875% 10/1/13 Aa3 2,500 2,331
Rfdg. Series A, 5.5% 2/1/11 Aaa 19,845 20,148
(MBIA Insured)
Rfdg. (Cap. Appreciation) Aaa 5,000 4,428
Series B, 0% 8/1/02 (AMBAC
Insured)
Massachusetts Health & Edl.
Facilities Auth. Rev.:
(Blood Research Institute - 4,625 4,778
Proj.) Series A, 6.5% 2/1/22
(MIT Proj.) Series I 2, 4.75% Aaa 6,000 4,945
1/1/28
(New England Med. Ctr. Hosp. Aaa 3,800 3,483
Proj.) Series G, 5.375%
7/1/24 (MBIA Insured)
(South Shore Hosp. Proj.) A2 11,930 11,130
Series F, 5.75% 7/1/29
Rfdg.:
(Baystate Med. Ctr. Proj.) Aaa 3,000 2,888
Series D, 5% 7/1/12 (FGIC
Insured)
(Fairview Extended Care Aaa 4,900 4,877
Proj.) Series B, 4.55%
1/1/21 (MBIA Insured)
(Harvard Univ. Proj.) Series Aaa 1,100 1,180
P, 6.5% 11/1/03
(Mass. Gen. Hosp. Proj.) Aaa 2,000 2,174
Series F, 6.25% 7/1/12
(AMBAC Insured)
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT (000S) VALUE (NOTE 1) (000S)
MASSACHUSETTS - CONTINUED
Massachusetts Hsg. Fin. Agcy.
Rfdg. (Rental Proj.) Series
A:
6.6% 7/1/14 (AMBAC Insured) Aaa $ 2,385 $ 2,489
(g)
6.65% 7/1/19 (AMBAC Insured) Aaa 1,910 2,009
(g)
Massachusetts Ind. Fin. Agcy. AAA 3,950 4,386
Ind. Dev. Rev. (Union
Mission Proj.) 9.55% 9/1/26
Massachusetts Ind. Fin. Agcy.
Resource Recovery Rev.:
(Ogden Haverhill Proj.) BBB 5,430 5,325
Series 1992 A, 4.6% 12/1/02
Rfdg. Series A, 4.7% 12/1/03 BBB 1,975 1,918
Massachusetts Ind. Fin. Agcy.
Rev. (Cap. Appreciation)
(Massachusetts Biomedical
Research Corp. Proj.) Series
A2:
0% 8/1/03 A1 29,600 24,935
0% 8/1/04 A1 5,000 3,984
0% 8/1/06 A1 30,800 21,927
0% 8/1/08 A+ 5,000 3,183
0% 8/1/09 - 21,800 12,843
0% 8/1/10 - 2,000 1,113
Massachusetts Muni. Wholesale
Elec. Co. Pwr. Supply Sys.
Rev.:
Rfdg.:
Series A, 6.75% 7/1/08 (MBIA Aaa 2,500 2,660
Insured)
Series B, 5% 7/1/12 (MBIA Aaa 2,715 2,620
Insured)
5% 7/1/10 (AMBAC Insured) Aaa 4,610 4,537
Series B, 6.75% 7/1/08 (MBIA Aaa 5,995 6,378
Insured)
Series C, 6.625% 7/1/06 Baa2 2,220 2,335
Series D, 6% 7/1/06 Baa2 1,300 1,344
Massachusetts Port Auth. Rev. Aa3 15,845 15,364
5.75% 7/1/29
Massachusetts Tpk. Auth.
Metro. Hwy. Sys. Rev. Series
A:
5% 1/1/27 (MBIA Insured) Aaa 11,000 9,444
5% 1/1/37 (MBIA Insured) Aaa 15,000 12,605
5.125% 1/1/23 (MBIA Insured) Aaa 8,500 7,605
Massachusetts Tpk. Auth. Aaa 28,330 28,362
Western Tpk. Rev. Series A,
5.55% 1/1/17 (MBIA Insured)
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT (000S) VALUE (NOTE 1) (000S)
MASSACHUSETTS - CONTINUED
Massachusetts Wtr. Poll.
Abatement Trust Rev.:
(MWRA Ln. Prog.) Series A, Aa1 $ 800 $ 784
5.25% 8/1/13
5.25% 8/1/14 Aa1 3,000 2,889
New England Ed. Ln. Marketing A3 18,500 19,009
Corp. Massachusetts Rfdg.
(Student Ln. Proj.) Series
A, 5.7% 7/1/05 (g)
New England Ed. Ln. Marketing
Corp. Massachusetts Student
Ln. Rev.:
Rfdg. Series G:
5% 8/1/00 A3 2,500 2,517
5.2% 8/1/02 Aa2 3,200 3,256
Series B, 5.4% 6/1/00 Aa2 2,500 2,513
335,201
MICHIGAN - 3.6%
Detroit Convention Facilities A 4,000 3,836
Rev. Rfdg. (Cobo Hall
Expansion Proj.) 5.25%
9/30/12
Detroit Wtr. Supply Sys. Rev.
Sr. Lien Series A:
5.75% 7/1/26 (FGIC Insured) Aaa 14,750 14,263
5.875% 7/1/22 (FGIC Insured) Aaa 16,905 16,726
5.875% 7/1/29 (FGIC Insured) Aaa 10,900 10,698
Lowell Area Schools (Cap. Aaa 19,185 4,949
Appreciation) 0% 5/1/20
(FGIC Insured) (Pre-Refunded
to 5/1/05 @ 33.6439) (h)
Michigan Bldg. Auth. Rev. Aaa 1,100 1,136
Series II, 6.25% 10/1/20
(MBIA Insured)
Michigan Hosp. Fin. Auth. Rev.:
(Mercy Health Svcs. Proj.):
Series Q, 5.375% 8/15/26 Aaa 4,750 4,333
(AMBAC Insured)
Series W, 5.25% 8/15/27 (FSA Aaa 4,000 3,572
Insured)
Series X, 6% 8/15/34 (MBIA Aaa 11,000 10,827
Insured)
Rfdg.:
(Bay Med. Ctr. Proj.) Series A3 960 1,000
A, 8.25% 7/1/12
(Sisters of Mercy Health Aaa 7,340 7,260
Corp. Proj.) 5.375% 8/15/14
(MBIA Insured)
Michigan Hsg. Dev. Auth.
Rental Hsg. Rev.:
Rfdg. Series B, 5.7% 4/1/12 AA- 3,750 3,766
Series B, 7.5% 4/1/10 AA- 6,000 6,221
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT (000S) VALUE (NOTE 1) (000S)
MICHIGAN - CONTINUED
Michigan Hsg. Dev. Auth. AA+ $ 300 $ 308
Single Family Mtg. Rev.
Series A, 7.5% 6/1/15
Michigan Muni. Bond Auth. Rev.:
Rfdg. (Local Govt. Ln. Prog.
Proj.) Series G:
7% 11/1/02 (AMBAC Insured) Aaa 1,465 1,568
7% 5/1/03 (AMBAC Insured) Aaa 2,700 2,905
5.125% 10/1/20 Aa1 26,800 24,026
Michigan Trunk Line (Cap. Aaa 8,010 4,817
Appreciation) Series A, 0%
10/1/09 (AMBAC Insured)
Michigan Underground Storage Aaa 3,500 3,711
Tank Fin. Assurance Auth.
Rev. Rfdg. Series I, 6%
5/1/06 (AMBAC Insured)
Michigan Univ. Rev. Rfdg. Aa2 7,750 7,878
(Univ. Hosp. Proj.) Series
A, 5.75% 12/1/12
Pinckney Cmnty. Schools Aaa 4,000 3,732
Livingston & Washtenaw
Counties 5.5% 5/1/27 (FGIC
Insured)
Romulus Cmnty. Schools 6% Aaa 7,500 7,496
5/1/29 (FGIC Insured)
Royal Oak Hosp. Fin. Auth.
Rev.:
(William Beaumont Hosp. Aa3 3,695 3,560
Proj.) 5.5% 1/1/14
Rfdg. (William Beaumont Hosp. Aa3 400 424
Proj.) 6.25% 1/1/09
Western Townships Util. Auth. Aaa 2,810 2,192
Swr. Disp. Sys. Rfdg. (Cap.
Appreciation) 0% 1/1/05
(FSA Insured)
151,204
MINNESOTA - 1.0%
Centennial Independent School Aaa 2,610 2,461
District #12 Rfdg. Series B,
4.875% 2/1/12 (FGIC Insured)
Minneapolis & Saint Paul Hsg. Aaa 9,700 8,355
& Redev. Auth. Health Care
Sys. Rev. Rfdg. (Healthspan
Corp. Proj.) Series A, 4.75%
11/15/18 (AMBAC Insured)
Minnesota Hsg. Fin. Agcy.
(Single Family Mtg. Proj.):
Series B, 5.8% 7/1/25 (g) Aa2 5,750 5,485
Series I, 6.25% 1/1/15 Aa2 1,820 1,845
Series K, 6.4% 1/1/15 Aa2 2,510 2,569
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT (000S) VALUE (NOTE 1) (000S)
MINNESOTA - CONTINUED
Saint Cloud Hosp. Facilities Aaa $ 2,000 $ 1,968
Rev. Rfdg. (Saint Cloud
Hosp. Proj.) Series C, 5.25%
10/1/13 (AMBAC Insured)
Univ. of Minnesota Gen. Aa3 15,000 15,054
Oblig. Rfdg. 4.8% 8/15/03
Western Minnesota Muni. Pwr.
Agcy. Pwr. Supply Rev.:
Rfdg. Series A, 5.5% 1/1/11 Aaa 3,525 3,587
(AMBAC Insured)
Series B, 6% 1/1/04 (AMBAC Aaa 1,390 1,460
Insured)
42,784
MISSISSIPPI - 0.1%
Hinds County Rev. Rfdg. Aaa 4,000 4,088
(Mississipi Methodist Hosp.
& Rehabilitation Proj.) 5.6%
5/1/12 (AMBAC Insured)
Mississippi Home Corp. Single Aaa 381 396
Family Rev. Rfdg. Series A,
9.25% 3/1/12 (FGIC Insured)
4,484
MISSOURI - 0.3%
Boone County Ind. Dev. Auth. - 1,995 2,172
1st Mtg. (Fairview Extended
Care Proj.) Series A,
10.125% 1/1/11 (Pre-Refunded
to 1/1/01 @ 103) (h)
Kirkwood Ind. Dev. Auth. - 2,000 2,158
Health Care Corp. Rev.
(Saint Joseph Hosp. Proj.)
7% 7/1/22 (Pre-Refunded to
7/1/02 @ 102) (h)
Missouri Higher Ed. Ln. Auth. Aa 8,000 8,100
Student Ln. Rev. (Sr. Lien)
Series A, 5.625% 2/15/01
Missouri Hsg. Dev. Commission AAA 1,505 1,511
Mtg. Rev. Series C, 5.5%
3/1/16 (g)
13,941
MONTANA - 0.3%
Montana Board of Invt.
(Payroll Tax Workers
Compensation Proj.):
Series 1991, 6.875% 6/1/11 Aaa 6,200 6,536
(MBIA Insured) (Escrowed to
Maturity) (h)
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT (000S) VALUE (NOTE 1) (000S)
MONTANA - CONTINUED
Montana Board of Invt.
(Payroll Tax Workers
Compensation Proj.): -
continued
Series 1996:
6.875% 6/1/20 (MBIA Insured) Aaa $ 1,255 $ 1,311
(Escrowed to Maturity) (h)
6.875% 6/1/20 (MBIA Insured) Aaa 3,870 4,043
(Escrowed to Maturity) (h)
6.875% 6/1/20 (MBIA Insured) Aaa 2,005 2,095
(Escrowed to Maturity) (h)
13,985
NEBRASKA - 0.1%
Nebraska Pub. Pwr. District Aaa 5,000 4,963
Rev. Series A, 5.25% 1/1/12
(MBIA Insured)
Scotts Bluff County Hosp. A3 1,110 1,192
Auth. #1 Hosp. Rev. 6.45%
12/15/04 (Pre-Refunded to
12/15/02 @ 102) (h)
6,155
NEVADA - 0.0%
Las Vegas Downtown Redev. BBB+ 500 503
Agcy. Tax Increment Rev.
(Fremont Street Proj.)
Series A, 6.1% 6/15/14
NEW HAMPSHIRE - 0.1%
New Hampshire Higher Edl. & - 3,480 3,620
Health Facilities Auth. Rev.
(Littleton Hosp. Assoc.,
Inc. Proj.) Series A, 9.5%
5/1/20 (Pre-Refunded to
5/1/00 @ 102) (h)
NEW JERSEY - 2.3%
Middlesex County Poll. Cont. - 7,750 8,495
Auth. Rev. Rfdg. (Amerada
Hess Corp. Proj.) 7.875%
6/1/22
New Jersey Gen. Oblig. 5.25% Aa1 6,000 6,130
3/1/07
New Jersey Health Care AAA 1,635 1,822
Facilities Fing. Auth. Rev.
(Christ Hosp. Group Issue
Proj.) 7% 7/1/06 (AMBAC
Insured)
New Jersey Tpk. Auth. Tpk. Aaa 1,000 1,102
Rev. Rfdg. Series C, 6.5%
1/1/09 (AMBAC Insured)
New Jersey Trans. Corp.
Series A:
5.25% 9/1/01 (FSA Insured) Aaa 4,000 4,047
5.4% 9/1/02 (FSA Insured) Aaa 3,535 3,610
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT (000S) VALUE (NOTE 1) (000S)
NEW JERSEY - CONTINUED
New Jersey Trans. Trust Fund
Auth.:
(Trans. Sys. Proj.):
Series A, 5.25% 6/15/11 Aa2 $ 15,345 $ 15,346
Series B, 5.25% 6/15/12 Aa2 10,000 9,915
Rfdg. (Trans. Sys. Proj.):
Series A, 5.5% 6/15/11 (MBIA Aaa 7,650 7,839
Insured)
Series B, 6.5% 6/15/10 (MBIA Aaa 5,000 5,554
Insured)
Series B, 5% 6/15/13 (AMBAC Aaa 26,055 24,982
Insured)
New Jersey Wastewtr. Aaa 3,225 3,433
Treatment Trust Ln. Rev.
Rfdg. Series C, 6.25%
5/15/04 (MBIA Insured)
Passaic County Util. Auth. Aaa 3,580 3,393
Solid Waste Disp. Rev.
Rfdg. (Cap. Appreciation) 0%
3/1/01 (MBIA Insured)
Warren County Poll. Cont. Aaa 1,000 1,053
Fing. Auth. Resource
Recovery Rev. 6.55% 12/1/06
(MBIA Insured)
96,721
NEW MEXICO - 0.8%
Albuquerque Arpt. Rev.:
Rfdg.:
6.5% 7/1/08 (AMBAC Insured) Aaa 1,500 1,637
(g)
6.7% 7/1/18 (AMBAC Insured) Aaa 2,500 2,672
(g)
6.75% 7/1/09 (AMBAC Insured) Aaa 1,150 1,283
(g)
6.75% 7/1/10 (AMBAC Insured) Aaa 1,700 1,904
(g)
6.75% 7/1/12 (AMBAC Insured) Aaa 1,935 2,176
(g)
Series A, 6.6% 7/1/16 (AMBAC Aaa 4,750 5,021
Insured) (g)
Bernalillo County Gross Aa3 7,090 6,464
Receipt Tax Rev. 5.25%
10/1/26
New Mexico Edl. Assistance
Foundation Student Ln. Rev.:
Series B, 5.25% 4/1/05 (AMBAC Aaa 3,500 3,517
Insured) (g)
Series II A, 5% 12/1/02 (g) Aaa 2,435 2,456
Rio Rancho Wtr. & Wastewtr. Aaa 1,600 1,695
Sys. Rev. Series A, 5.9%
5/15/15 (FSA Insured)
(Pre-Refunded to 5/15/06 @
100) (h)
Univ. of New Mexico Univ. A1 5,340 5,397
Rev. Rfdg. Series A, 6%
6/1/21
34,222
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT (000S) VALUE (NOTE 1) (000S)
NEW YORK - 16.2%
Metro. Trans. Auth. Dedicated Aaa $ 12,500 $ 11,281
Tax Fund Series A, 5.25%
4/1/26 (MBIA Insured)
Metro. Trans. Auth. New York
Commuter Facilities Rev.:
Rfdg.:
(Svc. Contract Proj.) Series Baa1 2,000 1,840
8, 5.25% 7/1/17
Series D, 5.125% 7/1/22 (MBIA Aaa 5,450 4,864
Insured)
Series A:
5.625% 7/1/27 (MBIA Insured) Aaa 6,525 6,197
6.125% 7/1/29 Baa1 25,000 24,994
Series C1, 5.125% 7/1/12 Aaa 7,570 7,365
(FGIC Insured)
6% 7/1/16 (FGIC Insured) Aaa 2,000 2,034
Metro. Trans. Auth. New York
Svc. Contract Rev.:
(Commuter Facilities Proj.)
Series O:
5.75% 7/1/08 Baa1 1,000 1,038
5.75% 7/1/13 Baa1 14,250 14,555
(Trans. Facilities Proj.):
Series 7, 5.4% 7/1/06 Baa1 1,000 1,022
Series O, 5.625% 7/1/05 Baa1 7,595 7,859
Series P, 5.75% 7/1/15 Baa1 9,500 9,439
Rfdg. (Trans. Facilities Baa1 1,000 1,052
Proj.) Series 5, 6.9% 7/1/05
Metro. Trans. Auth. New York
Trans. Facilities Rev.:
(Svc. Contract Proj.) Series Aaa 13,000 12,497
Q, 5.125% 7/1/13 (AMBAC
Insured)
Rfdg.:
(Svc. Contract Proj.):
Series 8:
5.25% 7/1/17 Baa1 2,150 1,978
5.375% 7/1/21 (FSA Insured) Aaa 6,400 5,962
Series R:
5% 7/1/02 Baa1 4,255 4,303
5% 7/1/03 Baa1 3,450 3,486
5.4% 7/1/10 Baa1 2,680 2,696
Series K, 6.3% 7/1/06 (MBIA Aaa 3,500 3,791
Insured)
Series A, 5.75% 7/1/21 (MBIA Aaa 11,430 11,166
Insured)
Nassau County Gen. Oblig.
Gen. Impt. Rfdg. Series A:
6.5% 5/1/04 (FGIC Insured) Aaa 2,825 3,024
6.5% 5/1/05 (FGIC Insured) Aaa 4,490 4,846
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT (000S) VALUE (NOTE 1) (000S)
NEW YORK - CONTINUED
Nassau County Gen. Oblig.
Gen. Impt. Rfdg. Series A: -
continued
6.5% 5/1/06 (FGIC Insured) Aaa $ 4,000 $ 4,343
New York City Gen. Oblig.:
Rfdg.:
Series A, 7% 8/1/04 A3 4,375 4,757
Series B:
5.7% 8/15/02 A3 5,805 5,975
5.7% 8/15/02 (Escrowed to A3 195 201
Maturity) (h)
Series D, 8% 2/1/05 A3 2,550 2,893
Series A:
6% 8/1/18 (FSA Insured) Aaa 4,900 4,911
(Escrowed to Maturity) (h)
6.375% 8/1/05 A3 3,410 3,585
7.75% 8/15/07 A3 40 43
7.75% 8/15/07 (Pre-Refunded Aaa 210 225
to 8/15/01 @ 10/1/05) (h)
Series B:
5.5% 8/15/01 A3 310 316
5.5% 8/15/01 (Escrowed to Aaa 90 92
Maturity) (h)
7.5% 2/1/03 A3 19,000 20,439
7.5% 2/1/04 A3 1,500 1,613
Series C:
6.4% 8/1/03 A3 4,120 4,348
6.5% 8/1/07 A3 2,435 2,561
6.5% 8/1/07 (Pre-Refunded to A3 565 602
8/1/02 @ 10/1/05) (h)
Series D:
6.5% 2/15/05 A3 500 535
6.6% 2/1/03 A3 975 1,027
6.6% 2/1/03 (Escrowed to A3 25 27
Maturity) (h)
Series H:
6.9% 2/1/01 A3 165 170
6.9% 2/1/01 (Escrowed to Aaa 80 82
Maturity) (h)
Series H, Sub-Series H 1, A3 100 102
5.5% 8/1/01 (Escrowed to
Maturity) (h)
Series J, 6% 2/15/04 A3 3,000 3,128
New York City Ind. Dev. Agcy. Aaa 1,885 1,980
Ind. Dev. Rev. (Japan
Airlines Co. Ltd. Proj.)
Series 1991, 6% 11/1/15
(FSA Insured) (g)
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT (000S) VALUE (NOTE 1) (000S)
NEW YORK - CONTINUED
New York City Ind. Dev. Agcy. A3 $ 500 $ 516
Spl. Facilities Rev. (Term.
One Group Assoc. Proj.) 6%
1/1/08 (g)
New York City Muni. Wtr. Fin.
Auth. Wtr. & Swr. Sys. Rev.:
Series A, 7% 6/15/09 (FGIC Aaa 2,500 2,587
Insured)
Series B:
5.5% 6/15/27 (MBIA Insured) Aaa 31,185 29,296
5.75% 6/15/26 A1 10,000 9,581
5.75% 6/15/26 (AMBAC Insured) Aaa 10,000 9,748
5.75% 6/15/29 A1 51,500 49,116
5.75% 6/15/29 (MBIA Insured) Aaa 15,950 15,510
5.875% 6/15/26 A1 1,325 1,291
New York City Transitional
Fin. Auth. Rev.:
(Future Tax Proj.):
Second Series A, 5% 8/15/15 Aa3 5,000 4,570
Second Series B, 4.75% Aa3 7,300 6,399
11/15/16
Series A:
5.125% 11/15/14 Aa3 5,000 4,693
5.25% 11/15/13 Aa3 3,000 2,915
6% 8/15/29 Aa3 8,430 8,407
New York City Trust Cultural Aaa 6,500 6,238
Resources Rev. (American
Museum of Natural History
Proj.) 5.65% 4/1/27 (MBIA
Insured)
New York State Dorm. Auth. Aa1 3,025 2,816
Lease Rev. (Court
Facilities - Westchester
County) 5.25% 8/1/18
New York State Dorm. Auth.
Rev.:
(City Univ. Sys.
Consolidation Proj.):
Series A, 5.75% 7/1/09 Baa1 4,370 4,527
Series D:
7% 7/1/09 Baa1 2,000 2,183
7% 7/1/09 (FGIC Insured) Aaa 3,780 4,203
(State Univ. Edl. Facilities
Proj.):
Series A:
5.5% 5/15/08 A3 3,500 3,576
5.5% 5/15/13 (FGIC Insured) Aaa 24,350 24,666
5.875% 5/15/11 A3 7,000 7,321
5.875% 5/15/17 (FGIC Insured) Aaa 6,865 7,065
Series B, 5.25% 5/15/11 A3 8,000 7,929
5.75% 5/15/09 A3 2,465 2,548
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT (000S) VALUE (NOTE 1) (000S)
NEW YORK - CONTINUED
New York State Dorm. Auth.
Rev.: - continued
(Suffolk County Judicial Baa1 $ 690 $ 789
Facilities Proj.) Series A,
9.5% 4/15/14
Rfdg. (State Univ. Edl. A3 3,000 3,203
Facilities Proj.) Series A,
6.5% 5/15/04
Series C, 7.5% 7/1/10 (FGIC Aaa 24,650 28,304
Insured)
New York State Envir.
Facilities Corp. Clean Wtr.
& Drinking Wtr. Rev.
(Revolving Funds Proj.)
Series F:
4.875% 6/15/18 Aa1 7,280 6,399
4.875% 6/15/20 Aa1 13,900 11,918
5% 6/15/15 Aa1 7,000 6,436
New York State Envir.
Facilities Corp. Poll. Cont.
Rev.:
(State Wtr. Revolving Aa1 4,930 4,458
Fund-New York City Muni.
Wtr. Proj.) Series D, 5.125%
6/15/19
Rfdg.:
(State Wtr. Revolving
Fund-New York City Muni.
Wtr. Proj.):
Series A, 5.75% 6/15/12 Aa1 2,000 2,074
5.75% 6/15/11 Aa1 12,500 12,987
Series A, 5.75% 6/15/10 Aa1 5,000 5,215
New York State Local Govt.
Assistance Corp.:
(Cap. Appreciation):
Series A, 0% 4/1/08 A3 2,000 1,305
Series B, 0% 4/1/08 A3 5,000 3,262
Rfdg.:
Series C, 5.5% 4/1/17 A3 21,850 21,310
Series E, 6% 4/1/14 A3 18,085 18,818
Rfdg. (Cap. Appreciation) A3 10,000 4,777
Series C, 0% 4/1/13
Series A, 5.375% 4/1/16 A3 11,000 10,519
New York State Med. Care Aa2 1,500 1,537
Facilities (Mtg. Proj.)
Series E, 6.2% 2/15/15
New York State Thruway Auth.
Gen. Rev.:
(Spl. Oblig. Cross Proj.) BBB 8,500 6,526
Series A, 0% 1/1/05
Rfdg. Series E, 5.25% 1/1/11 Aa3 9,120 9,085
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT (000S) VALUE (NOTE 1) (000S)
NEW YORK - CONTINUED
New York State Thruway Auth.
Svc. Contract Rev.:
(Local Hwy. & Bridge Proj.):
Series A, 6% 1/1/05 (MBIA Aaa $ 2,500 $ 2,643
Insured)
6% 4/1/03 Baa1 2,500 2,600
Rfdg. (Local Hwy. & Bridge Aaa 17,055 17,296
Proj.) Series B, 5.375%
4/1/11 (MBIA Insured)
5.25% 4/1/07 (MBIA Insured) Aaa 6,050 6,171
New York State Urban Dev.
Corp. Rev. Rfdg.:
(Correctional Cap. Facilities Baa1 6,000 6,275
Proj.) Series A, 6.3% 1/1/03
(Correctional Facilities Aaa 1,000 1,001
Proj.) Series A, 5.1% 1/1/09
(AMBAC Insured)
(State Facilities Proj.) Baa1 2,300 2,366
5.75% 4/1/11
Niagara Falls Gen. Oblig. Aaa 500 603
(Pub. Impt. Proj.) 7.5%
3/1/18 (MBIA Insured)
Triborough Bridge & Tunnel
Auth. Rev.:
(Convention Ctr. Proj.) Baa1 9,650 10,746
Series E, 7.25% 1/1/10
(Gen. Purp. Proj.) Series A, Aa3 3,155 2,681
4.75% 1/1/19
Rfdg. (Gen. Purp. Proj.) Aa3 16,100 15,838
Series Y, 5.5% 1/1/17
Series A:
5.125% 1/1/22 Aa3 5,550 4,903
5.25% 1/1/28 Aa3 13,315 11,818
Triborough Bridge & Tunnel
Auth. Spl. Oblig.:
Rfdg. Series A, 5.25% 1/1/11 Aaa 3,320 3,313
(FGIC Insured)
5.5% 1/1/07 (FGIC Insured) Aaa 7,500 7,757
683,878
NORTH CAROLINA - 2.5%
Harnett County Ctfs. of Prtn.:
7.5% 12/1/03 (AMBAC Insured) Aaa 2,640 2,917
7.5% 12/1/04 (AMBAC Insured) Aaa 2,865 3,223
North Carolina Eastern Muni.
Pwr. Agcy. Pwr. Sys. Rev.:
Rfdg.:
Series A:
5.2% 1/1/01 Baa1 10,000 10,003
5.5% 1/1/05 (MBIA Insured) Aaa 1,000 1,030
6.1% 1/1/01 Baa3 1,350 1,363
6.25% 1/1/03 Baa1 2,600 2,666
7.875% 1/1/02 Baa1 4,000 4,205
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT (000S) VALUE (NOTE 1) (000S)
NORTH CAROLINA - CONTINUED
North Carolina Eastern Muni.
Pwr. Agcy. Pwr. Sys. Rev.: -
continued
Rfdg.:
Series B:
6% 1/1/14 Baa3 $ 4,000 $ 3,880
7.25% 1/1/07 Baa3 7,375 8,028
Series C:
5.125% 1/1/03 Baa1 7,720 7,673
5.25% 1/1/04 Baa1 1,000 994
5.5% 1/1/07 Baa1 5,950 5,877
7% 1/1/07 Baa1 15,715 16,880
Series A, 5.1% 1/1/00 Baa1 7,000 7,004
Series B, 6% 1/1/05 Baa3 11,500 11,742
Series D:
6.7% 1/1/19 Baa3 3,000 3,022
6.75% 1/1/26 Baa3 7,000 7,045
North Carolina Muni. Pwr.
Agcy. #1 Catawba Elec. Rev.:
6.25% 1/1/17 (AMBAC Insured) Aaa 2,050 2,127
7.25% 1/1/07 Baa1 5,200 5,645
105,324
NORTH DAKOTA - 0.5%
Mercer County Poll. Cont.
Rev. Rfdg.:
(Antelope Valley Aaa 16,000 18,424
Station/Basin Elec. Pwr.
Coop. Proj.) 7.2% 6/30/13
(AMBAC Insured)
(Montana-Dakota Utils. Co. Aaa 3,750 3,956
Proj.) 6.65% 6/1/22 (FGIC
Insured)
22,380
OHIO - 2.4%
Bedford Hosp. Impt. Rev. - 835 868
Rfdg. (Bedford Cmnty. Hosp.
Proj.) 8.5% 5/15/09
(Pre-Refunded to 5/15/00 @
102) (h)
Cleveland Wtrwks. Rev.:
Rfdg. (1st Mtg. Proj.) Series Aaa 6,665 6,743
G, 5.5% 1/1/13 (MBIA Insured)
Rfdg. & Impt. Series I, 5% Aaa 10,000 8,837
1/1/23 (FSA Insured)
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT (000S) VALUE (NOTE 1) (000S)
OHIO - CONTINUED
Euclid City School District
(Cap. Appreciation):
0% 12/1/02 (AMBAC Insured) Aaa $ 1,265 $ 1,106
0% 12/1/03 (AMBAC Insured) Aaa 1,265 1,053
Franklin County Hosp. Rev. Baa3 33,000 27,433
(Ohio Health Corp. Proj.)
Series A, 5.6% 12/1/28
Marion County Hosp. Impt. BBB+ 380 381
Rev. Rfdg. (Comnty. Hosp.
Proj.) 5.6% 5/15/01
Ohio Bldg. Auth.:
(Adult Correctional Proj.) Aaa 4,000 4,127
Series A, 5.95% 10/1/14
(MBIA Insured)
(W. Green Bldg. A Proj.) A2 15,000 13,611
4.75% 4/1/14
Ohio Hsg. Fin. Agcy. Mtg. Rev.:
(Oakleaf-Toledo Apts. Proj.) AA- 1,550 1,704
10.25% 12/20/25
(Residential Proj.):
Series A1, 5.3% 9/1/26 (g) AAA 3,070 3,086
Series B3, 4.95% 9/1/20 (g) AAA 12,830 12,762
Series C1, 5% 3/1/19 (g) AAA 3,965 3,926
Ohio Tpk. Commission Rev.
Series A:
5.6% 2/15/12 (MBIA Insured) Aaa 1,250 1,268
5.7% 2/15/13 (MBIA Insured) Aaa 2,750 2,802
Ohio Wtr. Dev. Auth. Poll.
Cont. Facilities Rev.:
(Wtr. Cont. Ln. Fund Proj.)
State Match Series:
6.5% 6/1/03 (MBIA Insured) Aaa 2,940 3,128
6.5% 12/1/03 (MBIA Insured) Aaa 2,925 3,137
Rfdg. (Buckeye Pwr., Inc. Aaa 2,620 2,960
Proj.) 7.8% 11/1/14 (AMBAC
Insured)
Ohio Wtr. Dev. Auth. Rev. Aaa 1,975 2,086
(Fresh Wtr. Proj.) 6.25%
6/1/03 (AMBAC Insured)
101,018
OKLAHOMA - 1.0%
Oklahoma Dev. Fin. Auth. Rev. Aa3 15,000 14,716
Rfdg. (Saint John Health
Sys. Proj.) 6% 2/15/29
Oklahoma Inds. Auth. Rev. Aaa 15,250 14,481
Rfdg. (Health Sys. Oblig.
Grp. Proj.) Series A, 5.75%
8/15/29 (MBIA Insured)
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT (000S) VALUE (NOTE 1) (000S)
OKLAHOMA - CONTINUED
Sapulpa Muni. Auth. Util. Aaa $ 8,600 $ 8,426
Rev. Rfdg. 5.75% 4/1/23
(FGIC Insured)
Tulsa Muni. Arpt. Trust Rev. Baa2 3,600 3,838
(American Airlines Corp.
Proj.) 7.35% 12/1/11
41,461
OREGON - 0.4%
Multonomah County School
District #3 (Park Rose
Proj.):
7% 12/1/03 (FGIC Insured) Aaa 2,000 2,176
7% 12/1/04 (FGIC Insured) Aaa 2,540 2,806
Oregon Health Hsg. Edl. &
Cultural Facilities Auth.
(Lewis & Clark College
Proj.) Series A:
6% 10/1/13 (MBIA Insured) Aaa 1,750 1,818
6.125% 10/1/24 (MBIA Insured) Aaa 1,000 1,016
Port Morrow Poll. Cont. Rev.
Rfdg. (Pacific Northwest
Proj.) Series A:
8% 7/15/06 AA- 385 415
8% 7/15/07 AA- 430 463
8% 7/15/08 AA- 480 517
8% 7/15/09 AA- 540 582
8% 7/15/10 AA- 605 652
8% 7/15/11 AA- 385 412
Portland Swr. Sys. Series A, A1 4,000 4,286
6.25% 6/1/15 (Pre-Refunded
to 6/1/04 @ 101) (h)
15,143
PENNSYLVANIA - 3.4%
Allegheny County Arpt. Rev. Aaa 6,500 6,717
Rfdg. (Pittsburgh Intl.
Arpt. Proj.) Series A, 5.75%
1/1/07 (MBIA Insured) (g)
Allegheny County Hosp. Dev. Aaa 19,140 16,951
Auth. (Univ. of Pittsburgh
Med. Ctr. Proj.) Series B,
5.125% 7/1/22 (MBIA Insured)
Butler County Hosp. Auth. Aaa 5,000 5,280
Hosp. Rev. (North Hills
Passavant Hosp. Proj.)
Series A, 6.8% 6/1/06 (FSA
Insured) (Pre-Refunded to
6/1/01 @ 102) (h)
Cambria County Hosp. Dev. A2 1,500 1,594
Auth. Hosp. Rev. Rfdg. &
Impt. (Conemaugh Valley
Hosp. Proj.) Series B,
6.375% 7/1/18 (AMBAC
Insured) (Pre-Refunded to
7/1/02 @ 102) (h)
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT (000S) VALUE (NOTE 1) (000S)
PENNSYLVANIA - CONTINUED
Chester County Health & Ed. Aaa $ 5,000 $ 4,534
Facilities Auth. Health Sys.
Rev. (Jefferson Health Sys.
Proj.) Series B, 5.25%
5/15/22 (AMBAC Insured)
Cumberland County Muni. Auth. Baa3 8,400 8,443
Rev. Rfdg. (Carlisle Hosp. &
Health Proj.) 6.8% 11/15/23
Delaware County Auth. Hosp. Baa2 3,500 3,225
Rev. (Crozer-Chester Med.
Ctr. Proj.) 6% 12/15/20
Delaware County Auth. Rev.
(1st Mtg. Riddle Village
Proj.):
8.25% 6/1/22 (Escrowed to Aaa 4,500 5,212
Maturity) (h)
8.75% 6/1/10 (Pre-Refunded to Aaa 2,000 2,239
6/1/02 @ 102) (h)
9.25% 6/1/22 (Pre-Refunded to Aaa 3,075 3,474
6/1/02 @ 102) (h)
Northumberland County Auth. Aaa 11,830 5,545
Commonwealth Lease Rev.
(Correctional Facilities
Proj.) 0% 10/15/13 (MBIA
Insured) (Escrowed to
Maturity) (h)
Pennsylvania Convention Ctr.
Auth. Rev.:
Rfdg. Series A:
6.6% 9/1/09 (MBIA Insured) Aaa 3,000 3,268
6.7% 9/1/14 (MBIA Insured) Aaa 1,500 1,637
6.75% 9/1/19 Baa 4,500 4,681
Series A, 6.7% 9/1/16 (FGIC Aaa 2,000 2,232
Insured) (Escrowed to
Maturity) (h)
Pennsylvania Hsg. Fin. Agcy.:
Rfdg.:
(Multi-Family Proj.) 8.1% Aa 2,000 2,115
7/1/13
(Single Family Mtg. Proj.) Aa2 1,575 1,582
Series 54 A, 5.375% 10/1/28
(g)
Series 44 C, 6.65% 10/1/21 (g) Aa 10,000 10,213
Philadelphia Hosp. & Higher
Ed. Facilities Auth. Hosp.
Rev. Rfdg. (Pennsylvania
Hosp. Proj.):
5.7% 7/1/01 (Escrowed to Baa3 4,405 4,497
Maturity) (h)
5.95% 7/1/03 (Escrowed to Baa3 4,000 4,179
Maturity) (h)
Philadelphia Muni. Auth. Rev.
Rfdg. Series D:
6% 7/15/03 Baa2 220 223
6.125% 7/15/08 Baa2 4,000 4,038
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT (000S) VALUE (NOTE 1) (000S)
PENNSYLVANIA - CONTINUED
Philadelphia Wtr. & Swr. Rev. Aaa $ 3,000 $ 2,255
(Cap. Appreciation)
Fourteenth Series, 0%
10/1/05 (MBIA Insured)
Philadelphia Wtr. & Wastewtr.
Rev.:
5% 6/15/12 (FGIC Insured) Aaa 3,000 2,877
6.25% 8/1/09 (MBIA Insured) Aaa 3,230 3,501
6.25% 8/1/10 (MBIA Insured) Aaa 2,000 2,169
6.75% 8/1/04 (MBIA Insured) Aaa 3,000 3,264
6.75% 8/1/05 (MBIA Insured) Aaa 2,500 2,738
Pittsburgh Gen. Oblig. Series Aaa 3,000 3,152
B, 6.25% 9/1/16 (MBIA
Insured) (Pre-Refunded to
9/1/01 @ 102) (h)
Pittsburgh Wtr. & Swr. Auth.
Wtr. & Swr. Sys. Rev.:
Rfdg. Series A, 4.75% 9/1/16 Aaa 15,335 13,395
(FGIC Insured)
Rfdg. (Cap. Appreciation) Aaa 3,000 2,140
Series A, 0% 9/1/06 (FGIC
Insured) (Escrowed to
Maturity) (h)
Wyoming Ind. Dev. Auth. Poll. Aa2 4,300 4,345
Cont. Rev. Rfdg. (Proctor &
Gamble Paper Proj.) 5.55%
5/1/10
141,715
RHODE ISLAND - 0.1%
Rhode Island Depositor Econ. Aaa 2,645 2,723
Protection Corp. Spl. Oblig.
Rfdg. Series A, 5.75% 8/1/12
(MBIA Insured)
SOUTH CAROLINA - 1.4%
Charleston County Gen. Oblig. Aa3 2,500 2,663
6% 6/1/13 (Pre-Refunded to
6/1/06 @ 100) (h)
Charleston County Health
Facilities Rev. Rfdg. (1st.
Mtg. Episcopal Proj.):
Series A, 9.75% 4/1/16 - 2,820 3,024
(Pre-Refunded to 4/1/01 @
102) (h)
Series B, 9.75% 4/1/16 - 1,985 2,128
(Pre-Refunded to 4/1/01 @
102) (h)
Lexington County Health Svcs. Aaa 3,000 3,198
District Hosp. Rev. 7%
10/1/08 (FSA Insured)
(Pre-Refunded to 10/1/01 @
102) (h)
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT (000S) VALUE (NOTE 1) (000S)
SOUTH CAROLINA - CONTINUED
Piedmont Muni. Pwr. Agcy.
Elec. Rev.:
Rfdg. Series B, 5.25% 1/1/11 Aaa $ 9,125 $ 9,075
(MBIA Insured)
5.5% 1/1/10 (MBIA Insured) Aaa 1,455 1,489
5.5% 1/1/10 (MBIA Insured) Aaa 1,135 1,169
(Escrowed to Maturity) (h)
5.6% 1/1/09 (MBIA Insured) Aaa 2,945 3,041
5.6% 1/1/09 (MBIA Insured) Aaa 2,295 2,383
(Escrowed to Maturity) (h)
Richland County Hosp. Aaa 1,500 1,711
Facilities Rev. (Comnty.
Provider Pooled Ln. Prog.)
Series A, 7.125% 7/1/17 (FSA
Insured) (Escrowed to
Maturity) (h)
South Carolina Ed. Assistance
Auth. Rev. (Insured Student
Ln. Proj.):
6.4% 9/1/02 (g) - 1,500 1,556
6.625% 9/1/06 (g) AA 10,775 11,386
South Carolina Pub. Svc.
Auth. Rev. Rfdg. Series A:
5.75% 1/1/10 (MBIA Insured) Aaa 4,705 4,874
6.25% 1/1/03 (AMBAC Insured) Aaa 2,500 2,619
6.25% 1/1/04 (MBIA Insured) Aaa 2,565 2,715
6.375% 7/1/21 (AMBAC Insured) Aaa 3,750 3,867
6.5% 1/1/08 (MBIA Insured) Aaa 3,530 3,837
60,735
SOUTH DAKOTA - 0.0%
South Dakota Lease Rev. Rfdg. Aaa 1,000 1,118
Series A, 6.625% 9/1/12 (FSA
Insured)
TENNESSEE - 1.5%
Johnson City Elec. Rev. 5.15% Aaa 5,000 4,562
5/1/23 (MBIA Insured)
Knox County Health Edl. &
Hsg. Facilities Board Hosp.
Facilities Rev.:
(Fort Sanders Alliance Proj.) Aaa 2,000 2,036
Series C, 5.75% 1/1/14 (MBIA
Insured)
Rfdg. (Fort Sanders Alliance Aaa 2,660 3,062
Proj.) Series C, 7.25%
1/1/10 (MBIA Insured)
Memphis Gen. Oblig. 5.25% Aa2 8,730 8,301
7/1/16
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT (000S) VALUE (NOTE 1) (000S)
TENNESSEE - CONTINUED
Memphis-Shelby County Arpt.
Auth. Arpt. Rev.:
Rfdg.:
Series A:
6% 2/15/05 (MBIA Insured) (g) Aaa $ 1,000 $ 1,047
6.25% 2/15/09 (MBIA Insured) Aaa 1,500 1,603
(g)
6.25% 2/15/10 (MBIA Insured) Aaa 1,000 1,065
(g)
6.25% 2/15/11 (MBIA Insured) Aaa 1,415 1,505
(g)
Series B, 6.5% 2/15/09 (MBIA Aaa 500 543
Insured) (g)
Series D, 6% 3/1/24 (AMBAC Aaa 10,000 9,886
Insured) (g)
Metro. Gov't. of Nashville & Aaa 6,455 6,427
Davidson County Sports Auth.
Rev. (Stadium Proj.) 5.875%
7/1/21 (AMBAC Insured)
Metro. Gov't. of Nashville & Aaa 5,600 6,786
Davidson County Wtr. & Swr.
Rev. Rfdg. (Cap.
Appreciation) 7.7% 1/1/12
(FGIC Insured)
Shelby County Gen. Oblig.
Rfdg.:
Series A, 6.75% 4/1/04 Aa3 3,000 3,242
Series B, 5.5% 8/1/08 Aa2 10,000 10,363
Tennessee Gen. Oblig. Rfdg. Aaa 4,000 4,273
Series A, 6% 5/1/07
64,701
TEXAS - 9.8%
Allen Independent School
District Rfdg. (Cap.
Appreciation):
0% 2/15/04 Aaa 2,120 1,735
0% 2/15/05 Aaa 2,120 1,644
Alliance Arpt. Auth. Spl. Baa1 5,860 6,105
Facilities Rev. (American
Airlines, Inc. Proj.) 7.5%
12/1/29 (g)
Arlington Independent School
District Rfdg.:
5% 2/15/11 Aaa 2,720 2,648
5% 2/15/12 Aaa 5,770 5,548
Austin Combined Util. Sys.
Rev. Rfdg.:
(Cap. Appreciation):
Series A, 0% 11/15/01 (MBIA Aaa 4,000 3,675
Insured)
0% 11/15/09 (AMBAC Insured) Aaa 4,000 2,377
0% 11/15/10 (AMBAC Insured) Aaa 2,400 1,342
Series A, 0% 11/15/08 (MBIA Aaa 3,895 2,468
Insured)
Austin Independent School
District:
Rfdg. (Cap. Appreciation) 0% Aaa 6,000 5,324
8/1/02
8.125% 8/1/01 (Escrowed to Aaa 500 531
Maturity) (h)
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT (000S) VALUE (NOTE 1) (000S)
TEXAS - CONTINUED
Birdville Independent School Aaa $ 8,665 $ 4,739
District Rfdg. (Cap.
Appreciation) 0% 2/15/11
Cedar Hill Independent School Aaa 1,575 937
District Rfdg. (Cap.
Appreciation) 0% 8/15/09
Conroe Independent School
District Rfdg. (Cap.
Appreciation) Series B:
0% 2/15/07 Aaa 2,360 1,638
0% 2/15/08 Aaa 3,000 1,962
0% 2/15/09 Aaa 1,100 678
0% 2/15/10 Aaa 2,805 1,632
0% 2/15/11 Aaa 1,500 820
Corpus Christi Independant
School District Rfdg. (Cap.
Appreciation):
0% 8/15/01 Aaa 1,535 1,424
0% 8/15/02 Aaa 2,165 1,918
Cypress-Fairbanks Independent
School District Rfdg. (Cap.
Appreciation):
Series A, 0% 2/15/12 Aaa 7,100 3,619
0% 2/1/04 Aaa 4,250 3,485
Dallas Fort Worth Reg'l.
Arpt. Rev. Rfdg. (Joint
Dallas/Fort Worth Int'l.
Arpt. Proj.):
Series A, 7.375% 11/1/12 Aaa 1,000 1,116
(FGIC Insured)
6.5% 11/1/05 (FGIC Insured) Aaa 2,295 2,493
Dallas Gen. Oblig.:
(Cap. Appreciation) 0% 2/15/03 Aaa 5,115 4,421
Rfdg. 4.5% 2/15/14 Aaa 4,900 4,335
Dallas Hsg. Corp. Cap. Prog.
Rev. Rfdg. (Section 8
Assorted Projs.):
7.7% 8/1/05 Baa2 1,100 1,126
7.85% 8/1/13 Baa2 1,000 1,026
Dallas Independent School Aaa 10,925 7,394
District Rfdg. (Cap.
Appreciation) 0% 8/15/07
El Paso Arpt. Rev. (El Paso Aaa 1,000 1,009
Int'l. Arpt. Proj.) 5.125%
8/15/04 (FGIC Insured) (g)
El Paso Independent School
District Rfdg.:
5% 2/15/11 Aaa 2,630 2,560
5% 2/15/12 Aaa 3,000 2,885
El Paso Property Fin. Auth. Aaa 1,195 1,259
Single Family Mtg. Rev.
(GNMA Mtg.-Backed Securities
Proj.) Series A, 8.7%
12/1/18 (g)
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT (000S) VALUE (NOTE 1) (000S)
TEXAS - CONTINUED
El Paso Wtr. & Swr. Rev.
Rfdg. (Cap. Appreciation):
0% 3/1/05 (MBIA Insured) Aaa $ 2,650 $ 2,054
0% 3/1/06 (MBIA Insured) Aaa 3,700 2,715
Fort Bend Independent School Aaa 2,500 2,759
District 7% 2/15/05
Garland Independent School Aaa 5,000 3,994
District Series A, 4% 2/15/17
Grapevine-Colleyville Aaa 2,580 1,848
Independent School District
Rfdg. (Cap. Appreciation) 0%
8/15/06
Harris County Gen. Oblig.:
(Toll Road Proj.) Sub Lien Aa1 2,000 2,284
Series A, 7% 8/15/09
Rfdg. (Cap. Appreciation)
(Toll Road Proj.) Sub Lien:
0% 8/1/06 Aa1 4,245 3,050
0% 8/1/08 Aa1 8,005 5,126
Harris County Hosp. District Aaa 3,000 3,327
Mtg. Rev. Rfdg. 7.4% 2/15/10
(AMBAC Insured)
Houston Independent School Aaa 6,400 3,407
District Rfdg. Series A, 0%
8/15/11
Houston Wtr. & Swr. Sys. Rev. Aaa 6,735 4,763
Rfdg. Jr. Lien Series C, 0%
12/1/06 (AMBAC Insured)
Humble Independent School Aaa 3,280 2,277
District Rfdg. (Cap.
Appreciation) 0% 2/15/07
Hurst Euless Bedford
Independent School District
Rfdg. (Cap. Appreciation):
0% 8/15/11 Aaa 3,620 1,927
0% 8/15/12 Aaa 5,105 2,531
0% 8/15/13 Aaa 3,610 1,676
Katy Independent School
District:
Rfdg. Sereis A, 5% 2/15/10 Aaa 3,355 3,293
Rfdg. (Cap. Appreciation):
Series A, 0% 2/15/07 Aaa 2,450 1,701
0% 8/15/11 Aaa 4,170 2,220
Keller Independent School Aaa 4,000 3,520
District Rfdg. Series A,
5.125% 8/15/25
Leander Independent School Aaa 300 352
District 7.5% 8/15/08
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT (000S) VALUE (NOTE 1) (000S)
TEXAS - CONTINUED
Lower Colorado River Auth.
Rev.:
Rfdg. (Junior Lien-4th Aaa $ 6,000 $ 5,858
Supplement) 5.25% 1/1/15
(Escrowed to Maturity) (h)
Rfdg. (Cap. Appreciation) 0% Aaa 3,000 1,863
1/1/09 (MBIA Insured)
(Escrowed to Maturity) (h)
Lower Neches Valley Auth. Aa2 9,500 9,678
Ind. Dev. Corp. Envir. Rev.
(Mobil Oil Refining Corp.
Proj.) 6.35% 4/1/26 (g)
Lower Neches Valley Auth. Aa2 36,455 37,166
Ind. Dev. Corp. Swr.
Facilities Rev. (Mobil Oil
Refining Corp. Proj.) 6.4%
3/1/30 (g)
Mesquite Independent School
District:
Rfdg.:
5.25% 8/15/08 Aaa 3,085 3,137
5.25% 8/15/09 Aaa 1,080 1,089
5.375% 8/15/10 Aaa 3,380 3,431
5.375% 8/15/11 Aaa 1,385 1,398
Midlothian Independent School
District Rfdg. (Cap.
Appreciation):
0% 2/15/07 Aaa 1,935 1,343
0% 2/15/09 Aaa 1,970 1,215
0% 2/15/10 Aaa 1,525 887
Northwest Texas Independent Aaa 3,825 3,227
School District (Cap.
Appreciation) 0% 8/15/03
Port Dev. Corp. Ind. Dev. - 1,000 1,016
Rev. Rfdg. (Cargill, Inc.
Proj.) 7.7% 3/1/07
Round Rock Independent School
District:
Rfdg & School Bldg. (Cap. Aaa 7,430 4,464
Appreciation) 0% 8/15/09
(MBIA Insured)
Rfdg. (Cap. Appreciation):
0% 2/15/01 Aaa 2,000 1,897
0% 2/15/08 Aaa 9,800 6,410
0% 8/15/10 (MBIA Insured) Aaa 5,000 2,833
Series A, 7.5% 8/1/03 Aaa 1,300 1,432
4.5% 8/1/17 Aaa 5,575 4,729
Sabine River Auth. Poll. Baa1 1,250 1,303
Cont. Rev. (Texas Utils.
Elec. Co. Proj.) 8.25%
10/1/20 (g)
San Antonio Elec. & Gas Rev.:
Rfdg. (Cap. Appreciation):
Series 1991 B, 0% 2/1/05 Aaa 12,285 9,535
(FGIC Insured) (Escrowed to
Maturity) (h)
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT (000S) VALUE (NOTE 1) (000S)
TEXAS - CONTINUED
San Antonio Elec. & Gas Rev.:
- - continued
Rfdg. (Cap. Appreciation):
Series A, 0% 2/1/05 (AMBAC Aaa $ 5,850 $ 4,552
Insured)
Series B:
0% 2/1/07 (FGIC Insured) Aaa 10,000 6,938
(Escrowed to Maturity) (h)
0% 2/1/08 (FGIC Insured) Aaa 6,340 4,147
(Escrowed to Maturity) (h)
0% 2/1/09 (FGIC Insured) Aaa 2,000 1,236
(Escrowed to Maturity) (h)
0% 2/1/10 (FGIC Insured) Aaa 14,000 8,154
(Escrowed to Maturity) (h)
5.25% 2/1/10 AAA 10,455 10,486
5.25% 2/1/10 (Pre-Refunded to Aa1 545 558
2/1/07 @ 101) (h)
San Antonio Gen. Oblig.:
Rfdg. (Cap. Appreciation) Aaa 1,920 1,378
Series C, 0% 8/1/06 (MBIA
Insured)
Series 2000, 5% 2/1/20 (c) Aa2 5,000 4,350
San Antonio Independent Aaa 23,010 20,553
School District 5.125%
8/15/22
San Antonio Wtr. Rev.:
6.5% 5/15/10 (MBIA Insured) Aaa 1,690 1,786
6.5% 5/15/10 (MBIA Insured) Aaa 440 467
(Escrowed to Maturity) (h)
6.5% 5/15/10 (MBIA Insured) Aaa 500 533
(Pre-Refunded to 5/15/02 @
102) (h)
Spring Branch Independent
School District Rfdg. (Cap.
Appreciation):
0% 2/1/05 Aaa 5,725 4,448
0% 2/1/06 Aaa 5,710 4,200
Spring Independent School
District:
Rfdg. (Cap. Appreciation) 0% Aaa 3,000 2,718
2/15/02
4.875% 8/15/10 Aaa 4,000 3,867
Texarkana Health Facilities Aaa 1,750 1,817
Dev. Corp. Hosp. Rev.
(Wadley Reg'l. Med. Ctr.
Proj.) 7% 10/1/05 (MBIA
Insured)
Texas A & M Univ. Permanent Aaa 3,000 3,133
Univ. Fund Rfdg. 5.6% 7/1/05
Texas A & M Univ. Rev. Rfdg. Aa2 1,610 1,652
(Fing. Sys. Proj.) 5.5%
5/15/02
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT (000S) VALUE (NOTE 1) (000S)
TEXAS - CONTINUED
Texas Gen. Oblig.:
(College Student Ln. Proj.) Aa1 $ 5,350 $ 5,480
5.8% 8/1/05 (g)
(Pub. Fin. Auth. Proj.) Aa1 5,000 4,689
Series A, 5% 10/1/14
(Wtr. Finl. Assistance Proj.) Aa1 4,000 4,066
5.375% 8/1/10
Rfdg.:
(Pub. Fing. Auth. Proj.) Aa1 5,000 5,057
5.25% 10/1/09
(Pub. Fing. Auth. Proj.) Aa1 7,150 7,160
5.25% 10/1/11
(Veterans Land Proj.) 7.4% Aa1 2,500 2,607
12/1/20
Texas Muni. Pwr. Agcy. Rev.:
Rfdg. 0% 9/1/05 (AMBAC Aaa 13,000 9,833
Insured)
Rfdg. (Cap. Appreciation) 0% Aaa 5,900 4,712
9/1/04 (AMBAC Insured)
Texas Pub. Fin. Auth. Bldg.
Rev. Rfdg. (Cap.
Appreciation):
Series 1990, 0% 2/1/12 (MBIA Aaa 4,400 2,237
Insured)
0% 2/1/09 (MBIA Insured) Aaa 2,000 1,238
Travis County Health
Facilities Dev. Corp. Rev.
(Ascension Health Cr. Prog.)
Series A:
6.25% 11/15/18 (MBIA Insured) Aaa 15,550 15,939
6.25% 11/15/19 (MBIA Insured) Aaa 5,565 5,682
Univ. of Texas Permanent
Univ. Fund:
5% 7/1/10 Aaa 4,000 3,962
5.25% 7/1/11 Aaa 7,080 7,100
Univ. of Texas Univ. Rev.
Rfdg. (Fing. Sys. Proj.)
Series A:
6% 8/15/04 Aa1 1,170 1,238
6% 8/15/05 Aa1 1,000 1,064
413,645
UTAH - 2.8%
Intermountain Pwr. Agcy. Pwr.
Supply Rev.:
Rfdg.:
Series A:
6% 7/1/16 (AMBAC Insured) Aaa 15,345 15,582
6.5% 7/1/10 (AMBAC Insured) Aaa 1,635 1,799
Series B, 5.75% 7/1/16 (MBIA Aaa 30,260 30,093
Insured)
Series D, 5% 7/1/21 (MBIA Aaa 12,100 10,578
Insured)
Series G, 0% 7/1/12 Aaa 1,660 1,910
(Pre-Refunded to 1/1/03 @
101) (b)(h)
Spl. Oblig. Sixth Series B, Aaa 29,500 29,915
6% 7/1/16 (MBIA Insured)
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT (000S) VALUE (NOTE 1) (000S)
UTAH - CONTINUED
Intermountain Pwr. Agcy. Pwr.
Supply Rev.: - continued
Spl. Oblig. Sixth Series B:
6.5% 7/1/05 (MBIA Insured) Aaa $ 2,000 $ 2,173
6.5% 7/1/10 (MBIA Insured) Aaa 3,800 4,180
Jordan School District 7.625% Aa3 2,000 2,273
6/15/05
North Salt Lake Muni. Blg Aaa 6,020 6,883
Auth. Lease Rev. 8.625%
12/1/17 (Pre-Refunded to
12/1/02 @ 103) (h)
Salt Lake City Hosp. Rev. AAA 2,975 3,575
Rfdg. (Intermountain Health
Care Hosp., Inc. Proj.)
Series A, 8.125% 5/15/15
(Escrowed to Maturity) (h)
South Salt Lake City Ind. - 3,650 3,862
Rev. (Price Savers Wholesale
Club Proj.) 9% 11/15/13
Utah Board of Regents Student Aaa 5,000 4,848
Ln. Rev. Series H, 4.65%
5/1/06 (g)
Utah Hsg. Fin. Agcy. Single AAA 125 127
Family Mtg. Rev. Series G,
9.25% 7/1/19 (g)
117,798
VERMONT - 0.1%
Vermont Ind. Dev. Auth. Ind. - 4,350 4,578
Dev. Rev. (Radisson Hotel
Proj.) Series B1, 7.75%
11/15/15
VIRGINIA - 1.5%
Hampton Museum Rev. Rfdg.:
5.25% 1/1/09 A 3,825 3,766
5.25% 1/1/14 A 4,500 4,229
Henrico County Ind. Dev.
Auth. Pub. Facilities Lease
Rev. (Henrico County Reg'l.
Jail Proj.):
7.5% 8/1/04 (Escrowed to Aa2 2,455 2,748
Maturity) (h)
7.5% 8/1/05 (Escrowed to Aa2 2,590 2,944
Maturity) (h)
Loudoun County Ind. Dev.
Auth. Residential Care
Facilities Rev. (Falcons
Landing Proj.) Series A:
8.75% 11/1/24 (Pre-Refunded AAA 14,955 17,999
to 11/1/04 @ 103) (h)
9.25% 11/1/04 (Escrowed to - 965 1,089
Maturity) (h)
Peninsula Ports Auth. Hosp. Aa 1,500 1,654
Facilities Rev. Rfdg.
(Whittaker Memorial Hosp.
Proj.) 8.7% 8/1/23
Southeastern Pub. Svc. Auth. Aaa 4,000 4,030
Rev. Rfdg. Sr. Series A,
5.25% 7/1/10 (MBIA Insured)
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT (000S) VALUE (NOTE 1) (000S)
VIRGINIA - CONTINUED
Virginia Beach Dev. Auth.
Hosp. Facilities Rev.
(Virginia Beach Gen. Hosp.
Proj.):
5.125% 2/15/18 (AMBAC Insured) Aaa $ 3,100 $ 2,869
6% 2/15/12 (AMBAC Insured) Aaa 2,150 2,273
6% 2/15/13 (AMBAC Insured) Aaa 1,460 1,536
Virginia Commonwealth Trans.
Board Trans. Rev.:
(US Route 58 Corridor Dev. Aa2 10,000 9,830
Prog.) Series B, 5.75%
5/15/21
Rfdg. (US Route 58 Corridor Aa2 5,000 4,522
Dev. Prog.) Series C,
5.125% 5/15/19
Virginia Hsg. Dev. Auth. Aa1 1,890 1,928
Multi-family Hsg. Rev.
Series I, 5.95% 5/1/09 (g)
61,417
WASHINGTON - 5.4%
Benton County Pub. Util. Aaa 1,740 1,845
District #1 Elec. Rev. Rfdg.
6% 11/1/04 (AMBAC Insured)
Clark County School District
#117 Camas:
5.25% 12/1/11 (FSA Insured) Aaa 3,245 3,215
5.375% 12/1/12 (FSA Insured) Aaa 3,415 3,390
Douglas County Pub. Util. Aa3 2,790 3,345
District #1 Wells
Hydroelectric Rev. Rfdg.
Series A, 8.75% 9/1/18
King County Gen. Oblig. Aa1 3,300 3,428
Series D, 5.75% 12/1/11
Port Seattle Gen. Oblig.:
Series B:
5.5% 9/1/09 (FGIC Insured) (g) Aaa 4,010 4,053
5.6% 9/1/10 (FGIC Insured) (g) Aaa 4,230 4,280
5.8% 5/1/09 (g) Aa1 4,000 4,135
Port Seattle Passenger Aaa 7,930 7,925
Facilities Charge Rev.
Series B, 5% 12/1/06 (AMBAC
Insured) (g)
Washington Ctfs. Prtn. Aaa 5,745 5,627
(Convention & Trade Ctr.
Proj.) 5% 7/1/10 (MBIA
Insured)
Washington Gen. Oblig.:
(Motor Vehicle Fuel Tax Aa1 3,105 3,439
Proj.) Series B, 7% 9/1/05
Rfdg.:
Series R 93A, 5.75% 9/1/07 Aa1 9,500 9,953
Series R 96C, 6% 7/1/04 Aa1 2,000 2,108
Series A, 6.5% 7/1/03 Aa1 1,000 1,063
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT (000S) VALUE (NOTE 1) (000S)
WASHINGTON - CONTINUED
Washington Pub. Pwr. Supply
Sys. Nuclear Proj. #1 Rev.:
Rfdg.:
(Bonneville Pwr. Aa1 $ 1,000 $ 1,121
Administration Proj.)
Series B, 7% 7/1/08
Series A, 7% 7/1/08 Aa1 500 560
Series B, 5.125% 7/1/13 Aa1 10,000 9,440
5.75% 7/1/10 (MBIA Insured) Aaa 5,000 5,133
Washington Pub. Pwr. Supply
Sys. Nuclear Proj. #2 Rev.:
Rfdg.:
(Bonneville Pwr. Aaa 6,500 6,527
Administration Proj.)
Series B, 5.625% 7/1/12
(MBIA Insured)
Series A:
0% 7/1/11 (MBIA Insured) Aaa 1,350 717
5.125% 7/1/11 (FSA Insured) Aaa 10,420 10,119
5.5% 7/1/02 Aa1 9,050 9,248
5.9% 7/1/04 Aa1 2,850 2,975
6% 7/1/07 Aa1 2,500 2,634
Series B, 5.5% 7/1/03 Aa1 3,000 3,072
Series C, 0% 7/1/05 Aa1 16,080 12,175
Series A, 6% 7/1/05 (AMBAC Aaa 3,565 3,762
Insured)
Series C, 0% 7/1/05 (MBIA Aaa 11,000 8,342
Insured)
5.4% 7/1/12 Aa1 56,550 54,671
5.55% 7/1/10 (FGIC Insured) Aaa 31,000 31,063
Washington Pub. Pwr. Supply
Sys. Nuclear Proj. #3 Rev.:
Rfdg. Series B:
0% 7/1/06 (MBIA Insured) Aaa 5,000 3,579
7.375% 7/1/04 Aa1 3,750 3,887
Rfdg. (Cap. Appreciation) 0% Aaa 3,000 1,907
7/1/08 (MBIA Insured)
228,738
WEST VIRGINIA - 0.5%
Marshall County Poll. Cont. Aaa 22,650 22,330
Rev. (Ohio Pwr. Co.-Kammer
Proj.) Series B, 5.45%
7/1/14 (MBIA Insured)
MUNICIPAL BONDS - CONTINUED
MOODY'S RATINGS (UNAUDITED) (A) PRINCIPAL AMOUNT (000S) VALUE (NOTE 1) (000S)
WISCONSIN - 0.1%
Menomonee Falls Wtr. Sys. Aaa $ 3,375 $ 3,428
Mtg. Rev. 5.875% 12/1/16
(FSA Insured)
Wisconsin Hsg. & Econ. Dev. Aa2 1,980 1,975
Auth. Home Ownership Rev.
Series F, 5.2% 9/1/26 (g)
5,403
WYOMING - 0.2%
Natrona County Hosp. Rev. A3 4,500 4,729
(Wyoming Med. Ctr. Proj.)
8.125% 9/15/10 (Pre-Refunded
to 9/15/00 @ 102) (h)
Wyoming Farm Ln. Board Cap. AA- 3,995 2,992
Facs. Rev. 0% 10/1/05
(Escrowed to Maturity) (h)
7,721
TOTAL MUNICIPAL BONDS 4,147,558
(Cost $4,135,067)
</TABLE>
MUNICIPAL NOTES - 0.0%
TEXAS - 0.0%
Sabine River Auth. Poll. 1,000 1,000
Cont. Rev. (Texas Utils.
Elec. Co. Proj.) Series 1995
A, 3.75%, LOC Morgan
Guaranty Trust Co., NY, VRDN
(d)(g) (Cost $1,000)
CASH EQUIVALENTS - 0.9%
SHARES
Municipal Central Cash Fund, 36,679,290 36,679
3.90% (e)(f) (Cost $36,679)
TOTAL INVESTMENT PORTFOLIO - 4,185,237
99.0% (Cost 4,172,746)
NET OTHER ASSETS - 1.0% 40,205
NET ASSETS - 100% $ 4,225,442
SECURITY TYPE ABBREVIATIONS
VRDN - VARIABLE RATE DEMAND NOTE
LEGEND
(a) S&P credit ratings are used in the absence of a rating by Moody's
Investors Service, Inc.
(b) Debt obligation initially issued in zero coupon form which
converts to coupon form at a specified rate and date. The rate shown
is the rate at period end.
(c) Security purchased on a delayed delivery or when-issued basis.
(d) The coupon rate shown on floating or adjustable rate securities
represents the rate at period end.
(e) Information in this report regarding holdings by state and
security types does not reflect the holdings of the Municipal Central
Cash Fund. A listing of the Municipal Central Cash Fund's holdings as
of its most recent fiscal period end is available upon request.
(f) The rate quoted is the annualized seven-day yield of the fund at
period end.
(g) Private activity obligations whose interest is subject to the
federal alternative minimum tax for individuals.
(h) Security collateralized by an amount sufficient to pay interest
and principal.
OTHER INFORMATION
The composition of long-term debt holdings as a percentage of total
value of investments in securities, is as follows (ratings are
unaudited):
MOODY'S RATINGS S&P RATINGS
Aaa, Aa, A 84.6% AAA, AA, A 84.8%
Baa 8.1% BBB 6.7%
Ba 1.1% BB 0.0%
B 0.0% B 0.0%
Caa 0.0% CCC 0.0%
Ca, C 0.0% CC, C 0.0%
D 0.0%
The percentage not rated by Moody's or S&P amounted to 1.7%.
The distribution of municipal securities by revenue source, as a
percentage of net assets, is as follows:
General Obligations 26.8%
Electric Utilities 13.7
Transportation 10.9
Health Care 10.4
Water & Sewer 9.6
Escrowed/Pre-Refunded 8.6
Special Tax 5.6
Education 5.0
Others* (individually less 9.4
than 5%)
100.0%
* Includes short-term investments and net
other assets.
INCOME TAX INFORMATION
At November 30, 1999, the aggregate cost of investment securities for
income tax purposes was $4,172,764,000. Net unrealized appreciation
aggregated $12,473,000, of which $98,919,000 related to appreciated
investment securities and $86,446,000 related to depreciated
investment securities.
The fund hereby designates approximately $1,306,000 as a capital gain
dividend for the purpose of the dividend paid deduction.
At November 30, 1999, the fund had a capital loss carryforward of
approximately $30,652,000 of which $138,000, $533,000, $12,432,000,
$7,601,000 and $9,948,000 will expire on November 30, 2000, 2001,
2002, 2003 and 2005, respectively. All of the loss carryforwards were
acquired in the mergers and are available to offset future capital
gains of the fund to the extent provided by regulations.
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
AMOUNTS IN THOUSANDS (EXCEPT
PER-SHARE AMOUNT) NOVEMBER 30, 1999
ASSETS
Investment in securities, at $ 4,185,237
value (cost $4,172,746) -
See accompanying schedule
Receivable for investments 57,010
sold
Receivable for fund shares 1,958
sold
Interest receivable 66,580
Other receivables 10
TOTAL ASSETS 4,310,795
LIABILITIES
Payable to custodian bank $ 6
Payable for investments 35,366
purchased Regular delivery
Delayed delivery 35,458
Payable for fund shares 6,742
redeemed
Distributions payable 5,972
Accrued management fee 1,349
Other payables and accrued 460
expenses
TOTAL LIABILITIES 85,353
NET ASSETS $ 4,225,442
Net Assets consist of:
Paid in capital $ 4,254,098
Accumulated undistributed net (41,147)
realized gain (loss) on
investments
Net unrealized appreciation 12,491
(depreciation) on investments
NET ASSETS, for 350,054 $ 4,225,442
shares outstanding
NET ASSET VALUE, offering $12.07
price and redemption price
per share ($4,225,442
(divided by) 350,054 shares)
STATEMENT OF OPERATIONS
AMOUNTS IN THOUSANDS YEAR
ENDED NOVEMBER 30, 1999
INTEREST INCOME $ 239,500
EXPENSES
Management fee $ 17,303
Transfer agent fees 3,723
Accounting fees and expenses 677
Non-interested trustees' 19
compensation
Custodian fees and expenses 164
Registration fees 91
Audit 97
Legal 22
Reports to shareholders 85
Miscellaneous 16
Total expenses before 22,197
reductions
Expense reductions (62) 22,135
NET INTEREST INCOME 217,365
REALIZED AND UNREALIZED GAIN
(LOSS)
Net realized gain (loss) on:
Investment securities 17,579
Futures contracts 584 18,163
Change in net unrealized
appreciation (depreciation)
on:
Investment securities (298,241)
Futures contracts (302) (298,543)
NET GAIN (LOSS) (280,380)
NET INCREASE (DECREASE) IN $ (63,015)
NET ASSETS RESULTING FROM
OPERATIONS
<TABLE>
<CAPTION>
<S> <C> <C>
STATEMENT OF CHANGES IN NET ASSETS
AMOUNTS IN THOUSANDS YEAR ENDED NOVEMBER 30, 1999 YEAR ENDED NOVEMBER 30, 1998
INCREASE (DECREASE) IN NET
ASSETS
Operations Net interest income $ 217,365 $ 139,545
Net realized gain (loss) 18,163 1,019
Change in net unrealized (298,543) 69,434
appreciation (depreciation)
NET INCREASE (DECREASE) IN (63,015) 209,998
NET ASSETS RESULTING FROM
OPERATIONS
Distributions to shareholders (217,365) (139,545)
From net interest income
From net realized gain (2,533) (14,749)
TOTAL DISTRIBUTIONS (219,898) (154,294)
Share transactions Net 726,957 542,258
proceeds from sales of shares
Net asset value of shares - 2,152,869
issued in exchange for the
net assets of Spartan
Aggressive Municipal Fund,
Spartan Insured Municipal
Income Fund and Fidelity
Advisor Municipal Bond Fund
Reinvestment of distributions 150,248 115,173
Cost of shares redeemed (1,003,023) (551,658)
NET INCREASE (DECREASE) IN (125,818) 2,258,642
NET ASSETS RESULTING FROM
SHARE TRANSACTIONS
TOTAL INCREASE (DECREASE) (408,731) 2,314,346
IN NET ASSETS
NET ASSETS
Beginning of period 4,634,173 2,319,827
End of period $ 4,225,442 $ 4,634,173
OTHER INFORMATION
Shares
Sold 57,712 42,521
Issued in exchange for - 168,501
shares of Spartan Aggressive
Municipal Fund, Spartan
Insured Municipal Income
Fund and Fidelity Advisor
Municipal Bond Fund
Issued in reinvestment of 12,035 9,036
distributions
Redeemed (80,429) (43,262)
Net increase (decrease) (10,682) 176,796
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
FINANCIAL HIGHLIGHTS
YEARS ENDED NOVEMBER 30, 1999 1998 1997 1996 1995
SELECTED PER-SHARE DATA
Net asset value, beginning $ 12.850 $ 12.610 $ 12.430 $ 12.300 $ 11.040
of period
Income from Investment .595 .607 .607 .648 A .677
Operations Net interest
income
Net realized and unrealized (.773) .320 .235 .109 1.260
gain (loss)
Total from investment (.178) .927 .842 .757 1.937
operations
Less Distributions
From net interest income (.595) (.607) (.632) A (.623) (.677)
From net realized gain (.007) (.080) (.030) (.004) -
Total distributions (.602) (.687) (.662) (.627) (.677)
Net asset value, end of period $ 12.070 $ 12.850 $ 12.610 $ 12.430 $ 12.300
TOTAL RETURN (1.44)% 7.54% 7.02% 6.39% 17.95%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $ 4,225 $ 4,634 $ 2,320 $ 1,837 $ 1,801
(in millions)
Ratio of expenses to average .49% .53% .55% .56% .57%
net assets
Ratio of net interest income 4.77% 4.75% 4.92% 5.32% 5.69%
to average net assets
Portfolio turnover rate 28% 25% B 31% 53% 50%
</TABLE>
A NET INTEREST INCOME PER SHARE IN 1996 REFLECTS A PAYMENT FROM AN
ISSUER IN BANKRUPTCY WHICH WAS DISTRIBUTED IN 1997.
B THE PORTFOLIO TURNOVER RATE DOES NOT INCLUDE THE ASSETS ACQUIRED IN
THE MERGERS.
NOTES TO FINANCIAL STATEMENTS
For the period ended November 30, 1999
1. SIGNIFICANT ACCOUNTING POLICIES.
Spartan Municipal Income Fund (the fund) is a fund of Fidelity Court
Street Trust (the trust) and is authorized to issue an unlimited
number of shares. The trust is registered under the Investment Company
Act of 1940, as amended, as an open-end management investment company
organized as a Massachusetts business trust. The financial statements
have been prepared in conformity with generally accepted accounting
principles which require management to make certain estimates and
assumptions at the date of the financial statements. The following
summarizes the significant accounting policies of the fund:
SECURITY VALUATION. Securities are valued based upon a computerized
matrix system and/or appraisals by a pricing service, both of which
consider market transactions and dealer-supplied valuations.
Securities for which quotations are not readily available are valued
at their fair value as determined in good faith under consistently
applied procedures under the general supervision of the Board of
Trustees. Short-term securities with remaining maturities of sixty
days or less for which quotations are not readily available are valued
at amortized cost or original cost plus accrued interest, both of
which approximate current value.
INCOME TAXES. As a qualified regulated investment company under
Subchapter M of the Internal Revenue Code, the fund is not subject to
income taxes to the extent that it distributes substantially all of
its taxable income for its fiscal year. The schedule of investments
includes information regarding income taxes under the caption "Income
Tax Information."
INTEREST INCOME. Interest income, which includes amortization of
premium and accretion of original issue discount, is accrued as
earned.
EXPENSES. Most expenses of the trust can be directly attributed to a
fund. Expenses which cannot be directly attributed are apportioned
among the funds in the trust.
DISTRIBUTIONS TO SHAREHOLDERS. Distributions are declared daily and
paid monthly from net interest income. Distributions from realized
gains, if any, are recorded on the ex-dividend date.
Income and capital gain distributions are determined in accordance
with income tax regulations which may differ from generally accepted
accounting principles. These differences, which may result in
distribution reclassifications, are primarily due to differing
treatments for futures transactions, market discount, capital loss
carryforwards and losses deferred due to wash sales and futures
transactions. The fund also utilized earnings and profits distributed
to shareholders on redemption of shares as a part of the dividends
paid deduction for income tax purposes.
Permanent book and tax basis differences relating to shareholder
distributions will result in reclassifications to paid in capital and
may affect the per-share allocation between net interest income and
realized and unrealized gain (loss). Accumulated undistributed net
realized gain (loss) on investments may include temporary book
1. SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
DISTRIBUTIONS TO SHAREHOLDERS - CONTINUED
and tax basis differences that will reverse in a subsequent period.
Any taxable gain remaining at fiscal year end is distributed in the
following year.
SECURITY TRANSACTIONS. Security transactions are accounted for as of
trade date. Gains and losses on securities sold are determined on the
basis of identified cost.
2. OPERATING POLICIES.
MUNICIPAL CENTRAL CASH FUND. Pursuant to an Exemptive Order issued by
the Securities and Exchange Commission, the fund may invest in the
Municipal Central Cash Fund (the Cash Fund) managed by Fidelity
Investments Money Management, Inc. (FIMM), an affiliate of Fidelity
Management & Research Company (FMR). The Cash Fund is an open-end
money market fund available only to investment companies and other
accounts managed by FMR and its affiliates. The Cash Fund seeks
preservation of capital, liquidity, and current income by investing in
high-quality, short-term municipal securities of various states and
municipalities. Income distributions from the Cash Fund are declared
daily and paid monthly from net interest income. Income distributions
earned by the fund are recorded as interest income in the accompanying
financial statements.
WHEN-ISSUED SECURITIES. The fund may purchase or sell securities on a
when-issued basis. Payment and delivery may take place after the
customary settlement period for that security. The price of the
underlying securities is fixed at the time the transaction is
negotiated. The market values of the securities purchased on a
when-issued or forward commitment basis are identified as such in the
fund's schedule of investments. The fund may receive compensation for
interest forgone in the purchase of a when-issued security. With
respect to purchase commitments, the fund identifies securities as
segregated in its records with a value at least equal to the amount of
the commitment. Losses may arise due to changes in the market value of
the underlying securities, if the counterparty does not perform under
the contract, or if the issuer does not issue the securities due to
political, economic, or other factors.
FUTURES CONTRACTS. The fund may use futures contracts to manage its
exposure to the bond market and to fluctuations in interest rates.
Buying futures tends to increase the fund's exposure to the underlying
instrument, while selling futures tends to decrease the fund's
exposure to the underlying instrument or hedge other fund investments.
Losses may arise from changes in the value of the underlying
instruments or if the counterparties do not perform under the
contracts' terms. Gains (losses) are realized upon the expiration or
closing of the futures contracts. Futures contracts are valued at the
settlement price established each day by the board of trade or
exchange on which they are traded.
3. PURCHASES AND SALES OF INVESTMENTS.
Purchases and sales of securities, other than short-term securities,
aggregated $1,269,227,000 and $1,422,028,000, respectively.
The market value of futures contracts opened and closed during the
period amounted to $95,944,000 and $134,466,000, respectively.
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES.
MANAGEMENT FEE. As the fund's investment adviser, FMR receives a
monthly fee that is calculated on the basis of a group fee rate plus a
fixed individual fund fee rate applied to the average net assets of
the fund. The group fee rate is the weighted average of a series of
rates and is based on the monthly average net assets of all the mutual
funds advised by FMR. The rates ranged from .0920% to .3700% for the
period. The annual individual fund fee rate is .25%. In the event that
these rates were lower than the contractual rates in effect during the
period, FMR voluntarily implemented the above rates, as they resulted
in the same or a lower management fee. For the period, the management
fee was equivalent to an annual rate of .38% of average net assets.
SUB-ADVISER FEE. FMR, on behalf of the fund, has entered into a
sub-advisory agreement with FIMM, a wholly owned subsidiary of FMR.
For its services, FIMM receives a fee from FMR of 50% of the
management fee payable to FMR. The fee is paid prior to any voluntary
expense reimbursements which may be in effect.
TRANSFER AGENT AND ACCOUNTING FEES. Effective June 14, 1999 Citibank,
N.A. (Citibank) replaced UMB Bank, n.a. as the custodian, transfer
agent and shareholder servicing agent for the fund. Citibank has
entered into a sub-contract with Fidelity Service Company, Inc. (FSC),
an affiliate of FMR, under which FSC performs the activities
associated with the fund's transfer and shareholder servicing agent
and accounting functions. The fund pays account fees and asset-based
fees that vary according to account size and type of account. FSC pays
for typesetting, printing and mailing of all shareholder reports,
except proxy statements. The accounting fee is based on the level of
average net assets for the month plus out-of-pocket expenses.
For the period, the transfer agent fees were equivalent to an annual
rate of .08% of average net assets.
5. EXPENSE REDUCTIONS.
Through arrangements with the fund's custodian and transfer agent,
credits realized as a result of uninvested cash balances were used to
reduce a portion of the fund's expenses. During the period, the fund's
custodian and transfer agent fees were reduced by $12,000 and $50,000,
respectively, under these arrangements.
6. SHARE TRANSACTIONS.
Share transactions in connection with mergers for the period ended
November 30 1998 were as follows:
AMOUNTS IN THOUSANDS SHARES DOLLARS
Spartan Aggressive Municipal 72,669 $923,620
Fund
Spartan Insured Municipal 24,866 318,041
Income Fund
Fidelity Advisor Municipal 22 286
Bond Fund Class A
Class T 33 426
Class B 41 524
Institutional Class 11 135
Fidelity Municipal Bond Fund 70,859 909,837
(Initial Class of Fidelity
Advisor Municipal Bond Fund)
70,966 911,208
Total 168,501 $ 2,152,869
7. MERGER INFORMATION.
On September 17, 1998, the fund acquired all of the assets and assumed
all of the liabilities of Fidelity Advisor Municipal Bond Fund: Class
A, Class T, Class B, Institutional Class and Fidelity Advisor
Municipal Bond Fund (Initial Class of Fidelity Advisor Municipal Bond
Fund). The acquisition was approved by the shareholders of Class A,
Class T, Class B, Institutional Class and Initial Class of Fidelity
Advisor Municipal Bond Fund on August 3, 1998.
The fund's acquisition of Fidelity Advisor Municipal Bond Fund Class A
was accomplished by an exchange of 22,000 shares of the fund (each
valued at $12.84) for the 33,000 shares then outstanding (each valued
at $8.61) of Fidelity Advisor Municipal Bond Fund Class A. The fund's
acquisition of Fidelity Advisor Municipal Bond Fund Class T was
accomplished by an exchange of 33,000 shares of the fund (each valued
at $12.84) for the 49,000 shares then outstanding (each valued at
$8.62) of Fidelity Advisor Municipal Bond Fund Class T. The fund's
acquisition of Fidelity Advisor Municipal Bond Fund Class B was
accomplished by an exchange of 41,000 shares of the fund (each valued
at $12.84) for the 61,000 shares then outstanding (each valued at
$8.62) of Fidelity Advisor Municipal Bond Fund Class B.
The fund's acquisition of Fidelity Advisor Municipal Bond Fund
Institutional Class was accomplished by an exchange of 11,000 shares
of the fund (each valued at $12.84) for the 16,000 shares then
outstanding (each valued at $8.61) of Fidelity Advisor Municipal Bond
Fund Institutional Class. The fund's acquisition of Fidelity Municipal
Bond Fund (Initial Class of Fidelity
7. MERGER INFORMATION -
CONTINUED
Advisor Municipal Bond Fund) was accomplished by an exchange of
70,859,000 shares of the fund (each valued at $12.84) for the
105,672,000 shares then outstanding (each valued at $8.61) of Fidelity
Municipal Bond Fund (Initial Class of Fidelity Advisor Municipal Bond
Fund). Based on the opinion of fund counsel, the reorganization
qualified as a tax-free reorganization for federal income tax purposes
with no gain or loss recognized to the funds or their shareholders.
Fidelity Advisor Municipal Bond Fund's net assets, including
$65,723,000 of unrealized appreciation, were combined with the fund
for total net assets after the acquisition of $4,371,670,000.
On August 27, 1998, the fund acquired all of the assets and assumed
all of the liabilities of Spartan Insured Municipal Income Fund. The
acquisition, which was approved by the shareholders of Spartan Insured
Municipal Income Fund on July 15, 1998, was accomplished by an
exchange of 24,866,000 shares of the fund (each valued at $12.79) for
the 25,649,000 shares then outstanding (each valued at $12.40) of
Spartan Insured Municipal Income Fund. Based on the opinion of fund
counsel, the reorganization qualified as a tax-free reorganization for
federal income tax purposes with no gain or loss recognized to the
funds or their shareholders. Spartan Insured Municipal Income Fund's
net assets, including $22,083,000 of unrealized appreciation, were
combined with the fund for total net assets after the acquisition of
$3,454,350,000.
On August 20, 1998, the fund acquired all of the assets and assumed
all of the liabilities of Spartan Aggressive Municipal Fund. The
acquisition, which was approved by the shareholders of Spartan
Aggressive Municipal Fund on July 15, 1998, was accomplished by an
exchange of 72,669,000 shares of the fund (each valued at $12.71) for
the 77,680,000 shares then outstanding (each valued at $11.89) of
Spartan Aggressive Municipal Fund. Based on the opinion of fund
counsel, the reorganization qualified as a tax-free reorganization for
federal income tax purposes with no gain or loss recognized to the
funds or their shareholders. Spartan Aggressive Municipal Fund's net
assets, including $55,780,000 of unrealized appreciation, were
combined with the fund for total net assets after the acquisition of
$4,081,148,000.
REPORT OF INDEPENDENT ACCOUNTANTS
To the Trustees of Fidelity Court Street Trust and the Shareholders of
Spartan Municipal Income Fund:
In our opinion, the accompanying statement of assets and liabilities,
including the schedule of investments, and the related statements of
operations and of changes in net assets and the financial highlights
present fairly, in all material respects, the financial position of
Spartan Municipal Income Fund (a fund of Fidelity Court Street Trust)
at November 30, 1999, and the results of its operations, the changes
in its net assets and the financial highlights for the periods
indicated, in conformity with generally accepted accounting
principles. These financial statements and financial highlights
(hereafter referred to as "financial statements") are the
responsibility of the Spartan Municipal Income Fund's management; our
responsibility is to express an opinion on these financial statements
based on our audits. We conducted our audits of these financial
statements in accordance with generally accepted auditing standards
which require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements,
assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement
presentation. We believe that our audits, which included confirmation
of securities at November 30, 1999 by correspondence with the
custodian and brokers, provide a reasonable basis for the opinion
expressed above.
/s/PricewaterhouseCoopers LLP
PricewaterhouseCoopers LLP
Boston, Massachusetts
January 6, 2000
DISTRIBUTIONS
The Board of Trustees of Spartan Municipal Income Fund voted to pay on
December 23. 1999, to shareholders of record at the opening of
business on December 22, 1999, a distribution of $.006 per share
derived from capital gains realized from sales of portfolio
securities.
The fund hereby designates 100% of the long-term capital gain
dividends distributed during the fiscal year as 20%-rate capital gain
dividends.
During fiscal year ended 1999, 100% of the fund's income dividends was
free from federal income tax, and 10.79% of the fund's income
dividends was subject to the federal alternative minimum tax.
The fund will notify shareholders in January 2000 of amounts for use
in preparing 1999 income tax returns.
PROXY VOTING RESULTS
A special meeting of the fund's shareholders was held on December 15,
1999. The results of votes taken among shareholders on proposals
before them are reported below. Each vote reported represents one
dollar of net asset value held on the record date for the meeting.
PROPOSAL 1
To elect as Trustees the following twelve nominees.*
# OF % OF
VOTES CAST VOTES CAST
RALPH F. COX
Affirmative 3,135,419,311.04 97.006
Withheld 96,777,025.22 2.994
TOTAL 3,232,196,336.26 100.000
PHYLLIS BURKE DAVIS
Affirmative 3,132,582,110.71 96.918
Withheld 99,614,225.55 3.082
TOTAL 3,232,196,336.26 100.000
ROBERT M. GATES
Affirmative 3,135,664,806.55 97.013
Withheld 96,531,529.71 2.987
TOTAL 3,232,196,336.26 100.000
EDWARD C. JOHNSON 3D
Affirmative 3,134,639,545.56 96.982
Withheld 97,556,790.70 3.018
TOTAL 3,232,196,336.26 100.000
DONALD J. KIRK
Affirmative 3,136,284,719.58 97.033
Withheld 95,911,616.68 2.967
TOTAL 3,232,196,336.26 100.000
NED C. LAUTENBACH
Affirmative 3,137,914,510.94 97.083
Withheld 94,281,825.32 2.917
TOTAL 3,232,196,336.26 100.000
# OF % OF
VOTES CAST VOTES CAST
PETER S. LYNCH
Affirmative 3,138,556,508.13 97.103
Withheld 93,639,828.13 2.897
TOTAL 3,232,196,336.26 100.000
WILLIAM O. MCCOY
Affirmative 3,136,319,971.15 97.034
Withheld 95,876,365.11 2.966
TOTAL 3,232,196,336.26 100.000
GERALD C. MCDONOUGH
Affirmative 3,128,315,051.03 96.786
Withheld 103,881,285.23 3.214
TOTAL 3,232,196,336.26 100.000
MARVIN L. MANN
Affirmative 3,136,894,405.50 97.051
Withheld 95,301,930.76 2.949
TOTAL 3,232,196,336.26 100.000
ROBERT C. POZEN
Affirmative 3,137,057,584.79 97.057
Withheld 95,138,751.47 2.943
TOTAL 3,232,196,336.26 100.000
THOMAS R. WILLIAMS
Affirmative 3,128,882,711.68 96.804
Withheld 103,313,624.58 3.196
TOTAL 3,232,196,336.26 100.000
PROPOSAL 2
To ratify the selection of PricewaterhouseCoopers LLP as independent
accountants of the fund.
# OF % OF
VOTES CAST VOTES CAST
Affirmative 2,421,217,797.94 95.624
Against 34,020,972.41 1.343
Abstain 76,792,755.49 3.033
TOTAL 2,532,031,525.84 100.000
PROPOSAL 3
To adopt an Amended and Restated Declaration of Trust.*
# OF % OF
VOTES CAST VOTES CAST
Affirmative 2,887,949,756.03 90.562
Against 150,461,756.38 4.718
Abstain 150,503,417.13 4.720
TOTAL 3,188,914,929.54 100.000
Broker Non-Votes 43,281,406.72
PROPOSAL 4
To approve an amended management contract, including a management fee
structure change for the fund and allow future modifications of the
contract without a shareholder vote if permitted by the 1940 Act.
# OF % OF
VOTES CAST VOTES CAST
Affirmative 2,299,822,586,62 90.829
Against 105,137,160.25 4.152
Abstain 127,071,778.97 5.019
TOTAL 2,532,031,525.84 100.000
PROPOSAL 5
To approve a plan providing for the reorganization of the fund from a
series of one Massachusetts Business Trust to another.
# OF % OF
VOTES CAST VOTES CAST
Affirmative 2,247,568,880.20 90.093
Against 106,423,990.09 4.266
Abstain 140,714,554.03 5.641
TOTAL 2,494,707,424.32 100.000
Broker Non-Votes 37,324,101.52
PROPOSAL 6
To eliminate the fundamental 80% investment policy and adopt a
comparable non-fundamental policy.
# OF % OF
VOTES CAST VOTES CAST
Affirmative 2,167,706,209.27 86.892
Against 182,090,352.74 7.299
Abstain 144,910,862.31 5.809
TOTAL 2,494,707,424.32 100.000
Broker Non-Votes 37,324,101.52
PROPOSAL 7
To amend the fund's fundamental investment limitation concerning
diversification to exclude securities of other investment companies
from the limitation for the fund.
# OF % OF
VOTES CAST VOTES CAST
Affirmative 2,169,996,974.35 86.984
Against 173,239,479.87 6.944
Abstain 151,470,970.10 6.072
TOTAL 2,494,707,424.32 100.000
Broker Non-Votes 37,324,101.52
*DENOTES TRUST-WIDE PROPOSALS AND VOTING RESULTS.
MANAGING YOUR INVESTMENTS
Fidelity offers several ways to conveniently manage your personal
investments via your telephone or PC. You can access your account
information, conduct trades and research your investments 24 hours a
day.
BY PHONE
Fidelity Automated Service Telephone provides a single toll-free
number to access account balances, positions, quotes and trading. It's
easy to navigate the service, and on your first call, the system will
help you create a personal identification number (PIN) for security.
(PHONE_GRAPHIC)FIDELITY AUTOMATED
SERVICE TELEPHONE (FASTSM)
1-800-544-5555
PRESS
1 For mutual fund and brokerage trading.
2 For quotes.*
3 For account balances and holdings.
4 To review orders and mutual
fund activity.
5 To change your PIN.
*0 To speak to a Fidelity representative.
BY PC
Fidelity's Web site on the Internet provides a wide range of
information, including daily financial news, fund performance,
interactive planning tools and news about Fidelity products and
services.
(COMPUTER_GRAPHIC)FIDELITY'S WEB SITE
WWW.FIDELITY.COM
If you are not currently on the Internet, call EarthLink Sprint at
1-800-288-2967, and be sure to ask for registration number SMD004 to
receive a special Fidelity package that includes 30 days of free
Internet access. EarthLink is North America's #1 independent Internet
access provider.
(COMPUTER_GRAPHIC)
FIDELITY ON-LINE XPRESS+(registered trademark)
Fidelity On-line Xpress+ software for Windows combines comprehensive
portfolio management capabilities, securities trading and access to
research and analysis tools . . . all on your desktop. Call Fidelity
at 1-800-544-0240 or visit our Web site for more information on how to
manage your investments via your PC.
* WHEN YOU CALL THE QUOTES LINE, PLEASE REMEMBER THAT A FUND'S YIELD
AND RETURN WILL VARY AND,
EXCEPT FOR MONEY MARKET FUNDS, SHARE PRICE WILL ALSO VARY. THIS MEANS
THAT YOU MAY HAVE A
GAIN OR LOSS WHEN YOU SELL YOUR SHARES. THERE IS NO ASSURANCE THAT
MONEY MARKET FUNDS WILL BE
ABLE TO MAINTAIN A STABLE $1 SHARE PRICE; AN INVESTMENT IN A MONEY
MARKET FUND IS NOT INSURED
OR GUARANTEED BY THE U.S. GOVERNMENT. TOTAL RETURNS ARE HISTORICAL AND
INCLUDE CHANGES IN SHARE
PRICE, REINVESTMENT OF DIVIDENDS AND CAPITAL GAINS, AND THE EFFECTS OF
ANY SALES CHARGES.
TO WRITE FIDELITY
If more than one address is listed, please locate the address that is
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send you written confirmation upon completion of your request.
(LETTER_GRAPHIC)MAKING CHANGES
TO YOUR ACCOUNT
(such as changing name, address, bank, etc.)
Fidelity Investments
P.O. Box 770001
Cincinnati, OH 45277-0002
(LETTER_GRAPHIC)FOR NON-RETIREMENT
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BUYING SHARES
Fidelity Investments
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OVERNIGHT EXPRESS
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Attn: Redemptions - CP6I
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(LETTER_GRAPHIC)FOR RETIREMENT
ACCOUNTS
BUYING SHARES
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OVERNIGHT EXPRESS
Fidelity Investments
Attn: Redemptions - CP6R
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GENERAL CORRESPONDENCE
Fidelity Investments
P.O. Box 500
Merrimack, NH 03054-0500
INVESTMENT ADVISER
Fidelity Management & Research Company
Boston, MA
INVESTMENT SUB-ADVISER
Fidelity Investment Money
Management, Inc. (FIMM),
Merrimack, NH
OFFICERS
Edward C. Johnson 3d, President
Robert C. Pozen, Senior Vice President
Fred L. Henning, Jr., Vice President
Dwight D. Churchill, Vice President
George A. Fischer, Vice President
Eric D. Roiter, Secretary
Richard A. Silver, Treasurer
Matthew N. Karstetter, Deputy Treasurer
Stanley N. Griffith, Assistant Vice President
John H. Costello, Assistant Treasurer
Thomas J. Simpson, Assistant Treasurer
BOARD OF TRUSTEES
Ralph F. Cox *
Phyllis Burke Davis *
Robert M. Gates *
Edward C. Johnson 3d
E. Bradley Jones *
Donald J. Kirk *
Peter S. Lynch
Marvin L. Mann *
William O. McCoy *
Gerald C. McDonough *
Robert C. Pozen
Thomas R. Williams *
ADVISORY BOARD
J. Gary Burkhead
Abigail P. Johnson
Ned C. Lautenbach
GENERAL DISTRIBUTOR
Fidelity Distributors Corporation
Boston, MA
* INDEPENDENT TRUSTEES
HIY-ANN-0100 88395
1.539263.102
TRANSFER AND SHAREHOLDER
SERVICING AGENT
Citibank N.A.
New York NY
and
Fidelity Service Company, Inc.
Boston, MA
CUSTODIAN
Citibank N.A.
New York NY
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