MINNESOTA MUNICIPAL INCOME FUND, INC.
MINNESOTA MUNICIPAL INCOME FUND II, INC.
MINNESOTA MUNICIPAL INCOME FUND III, INC.
ARIZONA MUNICIPAL INCOME FUND, INC.
FLORIDA INSURED MUNICIPAL INCOME FUND
COLORADO INSURED MUNICIPAL INCOME FUND, INC.
ANNUAL REPORT
Dated March 31, 1995
THE VOYAGEUR FUNDS
GENERAL INFORMATION
THE FUNDS
Voyageur Minnesota Municipal Income Fund, Inc., Voyageur Minnesota
Municipal Income Fund II, Inc., Voyageur Minnesota Municipal Income Fund III,
Inc., Voyageur Arizona Municipal Income Fund, Inc., Voyageur Florida Insured
Municipal Income Fund and Voyageur Colorado Insured Municipal Income Fund, Inc.
(the "Funds") are diversified, closed-end management investment companies
(except Voyageur Minnesota Municipal Income Fund, Inc., Voyageur Minnesota
Municipal Income Fund III, Inc., and Voyageur Colorado Insured Municipal Income
Fund, Inc. which are non-diversified management investment companies) whose
shares trade on the American Stock Exchange ("ASE") under the symbols VMN, VMM,
VYM, VAZ, VFL and VCF, respectively. The investment objective of each Fund is to
provide high current income exempt from federal income tax and from the personal
income tax of its state, if any, consistent with the preservation of capital.
Voyageur Florida Insured Municipal Income Fund will generally seek investments
that will enable its shares to be exempt from Florida's intangible personal
property tax. Each Fund will seek to achieve its investment objective by
investing substantially all of its net assets in investment grade, tax-exempt
municipal obligations.
INVESTMENT ADVISER
Voyageur Fund Managers, Inc. (the "Adviser") acts as the Funds' investment
adviser. As of March 31, 1995, the Adviser acted as the investment adviser to
six closed-end investment companies and ten open-end investment companies
(comprising twenty-six separate investment portfolios) and numerous private
accounts with combined total assets of approximately $7.9 billion.
SHAREHOLDER INFORMATION
Weekly net asset value and market price information for the Funds are
published each Monday in The Wall Street Journal and The New York Times and each
Saturday in Barron's, as well as numerous other newspapers.
DISTRIBUTIONS AND DIVIDEND REINVESTMENT PLAN
Under the Funds' current policies, shareholders may elect to receive all
dividends and other distributions in cash paid by check mailed directly to the
shareholders by the dividend paying agent, Norwest Bank Minnesota, N.A., (the
"Plan Agent"). Under each Fund's Dividend Reinvestment Plan, (collectively the
"Plans"), common shareholders not making such election will be automatically
enrolled in the Funds' Plans. Under the Plans, all distributions to common
shareholders of net investment income and capital gains will be automatically
reinvested in additional shares of the Funds' common shares. The Plan Agent
serves as agent for the common shareholders in administering the Plans. After
each Fund declares a dividend or determines to make a capital gains
distribution, the Plan Agent will, as agent for the participants, receive the
cash payment and use it to buy shares of each Fund's common shares in the open
market, on the ASE or elsewhere, for the participants' accounts. The Funds will
not issue any new shares in connection with the Plans.
STATE OR MUNICIPAL LEASE OBLIGATIONS
Pursuant to Board of Directors or Trustees resolutions, the Funds may
invest without limit in state or municipal leases and participation interests
therein. Municipal leases are obligations issued by state and local governments
or authorities to finance the acquisition of equipment and facilities such as
fire, sanitation or police vehicles or telecommunications equipment, buildings
or other capital assets.
Municipal lease obligations, except in certain circumstances, are
considered illiquid by the staff of the Securities and Exchange Commission.
Municipal lease obligations held by the Funds will be treated as illiquid unless
they are determined to be liquid pursuant to guidelines established by the
Funds' Board of Directors or Trustees. Under these guidelines, the Adviser will
consider factors including, but not limited to (1) whether the lease can be
cancelled, (2) what assurance there is that the assets represented by the lease
can be sold, (3) the municipality's general credit strength (e.g., its debt,
administrative, economic and financial characteristics), (4) the likelihood that
the municipality will discontinue appropriating funding for the leased property
because the property is no longer deemed essential to the operations of the
municipality (e.g., the potential for an "event of nonappropriation"), and (5)
the legal recourse in the event of failure to appropriate. Additionally, the
lack of an established trading market for municipal lease obligations may make
the determination of fair market value more difficult. Although each Fund may
invest up to 15% of its total assets in illiquid securities, the Funds have no
intention of investing more than 5% of its total assets in such securities,
including illiquid municipal lease obligations.
OTHER INFORMATION
Since March 31, 1994, except as stated above, there have been (i) no
material changes in the Funds' investment objectives or policies, (ii) no
changes to the Funds' charters or by-laws, (iii) no material changes in the
principal risk factors associated with investment in the Funds, and (iv) no
changes in persons who are primarily responsible for the day-to-day management
of the Funds' portfolios.
Dear Shareholder:
Over the past 12 months, we were witness to some dramatic events in the economy
which adversely affected the municipal bond market during 1994, while sowing the
seeds of a bond market rally which enabled municipal bonds to recover -- during
the first three months of 1995 -- almost all of their 1994 losses. Throughout
this reporting period, signs of economic growth spurred fears of inflation.
These ongoing fears pressed the Federal Reserve Board to increase short-term
interest rates on seven separate occasions in one year's time; increasing the
rate 3.00% overall. This rise in short term interest rates affected leveraged
closed end municipal bond funds in two ways: First, as the Federal Reserve Board
acted, the municipal bond market reacted, touching off the first extended bear
market since 1987. Falling bond prices were magnified by the funds' leveraged
capital structure, causing sharp declines in the funds' net asset values.
Second, rising short term interest rates increased the cost paid by the funds on
their preferred shares, leading to dividend cuts for many leveraged municipal
bond funds. This caused the market price of many closed end funds -- which had
been trading at premiums to net asset value -- to drop as investor sentiment
towards closed end funds soured.
In 1995, net asset values for the Voyageur Funds more than recovered from their
1994 declines. However, the market price of the funds' common shares continued
to trade at discounts to net asset value. As a result, the performance of the
Voyageur Funds has been mixed.
The performance of the Voyageur Funds was adversely effected by the overall
market climate. Consulting the Factors Affecting Fund Performance section of
this report highlights the economic conditions of this reporting period and
discusses how these conditions affected your investment(s). The chart below
shows the distributions for the year ended March 31, 1995 and the net asset
value, market price, and comparative premium/discount of market price to net
asset value for common shares as of March 31, 1995.
<TABLE>
<CAPTION>
Net Investment
Income Capital Gains Net
Distribution Distribution Asset Market Premium/
Voyageur Fund (Cents/Share) (Cents/Share) Value Price Discount
<S> <C> <C> <C> <C> <C>
Voyageur Minnesota Municipal Income Fund, Inc. $0.93 $0.02 $14.21 $14.50 +2.0%
Voyageur Minnesota Municipal Income Fund II, Inc. 0.83 N/A 13.12 12.38 -5.7
Voyageur Minnesota Municipal Income Fund III, Inc. 0.73 N/A 12.20 11.25 -7.8
Voyageur Arizona Municipal Income Fund, Inc. 0.78 0.05 13.22 12.13 -8.3
Voyageur Florida Insured Municipal Income Fund 0.77 N/A 13.17 12.25 -7.0
Voyageur Colorado Insured Municipal Income Fund, Inc. 0.76 0.03 13.19 12.25 -7.1
</TABLE>
Economic indicators continue to reinforce our belief that inflation is currently
under control and should remain stable throughout the year. This bodes well for
continued stability in the net asset values of the Voyageur Funds. However, the
potential exists for further increases in short term interest rates if the
economy continues to expand at a robust rate. Rising short term rates could
continue to put pressure on the dividends paid by leveraged closed end municipal
bond funds and cause market prices to continue to trade at discounts to net
asset values.
While there are likely to be rough spots along the way, shareholders who share
Voyageur's longer term outlook for slowing economic growth and lower short and
long term interest rates will be amply rewarded.
Sincerely,
John G. Taft
President
Voyageur Minnesota Municipal Income Fund, Inc.
Voyageur Minnesota Municipal Income Fund II, Inc.
Voyageur Minnesota Municipal Income Fund III, Inc.
Voyageur Arizona Municipal Income Fund, Inc.
Voyageur Florida Insured Municipal Income Fund
Voyageur Colorado Insured Municipal Income Fund, Inc.
FACTORS AFFECTING FUND PERFORMANCE
Over the past 12 months (April 1, 1994 to March 31, 1995), the municipal bond
market has experienced extreme volatility as a result of strong economic
conditions. In past economic cycles, strong growth has typically lead to
increased inflation. The Federal Reserve Board (the "Fed") is resolved to fight
inflation. Towards that end, the Fed moved several times throughout the period
to raise short term interest rates. In a series of rate hikes that began in
February of 1994, the Fed raised short term interest rates 250 basis points
(2.50%) in 1994 and another 50 basis points (.50%) thus far in 1995, for a total
rate increase of 300 basis points (3.00%) in an effort to slow domestic growth
and head off concerns of price increases.
After 12 months of tighter monetary policy, the Fed appears to have succeeded in
directing the U.S. economy towards slower, non-inflationary growth. Recent
economic data indicates that the economy's growth is showing signs of slowing to
a moderate pace. Bond investors' fears of inflation have subsided, thereby
allowing interest rates to fall and bond prices to rise. We anticipate
additional price appreciation for long-term bonds, although at a slower and less
dramatic pace than experienced in the first quarter of 1995.
The municipal bond market seemed to rebound on cue. The key event of the year
was the drastic tightening by the Fed that pushed the bond market into a
temporary tailspin. Two components tended to drive the direction of the market:
fundamentals and emotions. Much of 1994 was a classic example of emotions--or
fear--taking precedent. Throughout the period, the economic data was actually
favorable for bond investors: strong growth and no disconcerting acceleration in
inflation. The economic conditions that existed in 1994 should have been
constructive for the bond market, but investors' fears of inflation caused bonds
to become oversold . Investor perception turned negative and drove bond prices
sharply lower. The tide turned in mid-November and bond prices rallied as the
market began to realize that their fears were overblown. Since that time, bond
prices have rebounded as investors experienced the strongest rally in nine
years--all within a short, four-month timeframe. This remarkable performance
argues for the merit of being a long term investor and focusing on the
fundamentals and dismissing the emotions of the market.
Some specific information about each of the Voyageur Municipal Income Funds is
discussed below. Portfolio abstract and financial information about each fund is
presented later in this report.
VOYAGEUR MINNESOTA MUNICIPAL INCOME FUND, INC., VOYAGEUR MINNESOTA MUNICIPAL
INCOME FUND II, INC., AND VOYAGEUR MINNESOTA MUNICIPAL INCOME FUND III, INC.:
The volatility of the bond market caused the Minnesota Municipal Income Funds to
deteriorate in value dramatically throughout much of 1994. Most of the
investment losses were recouped in the first quarter of 1995. The total
investment return based on net asset value for the 12 months ended March 31,
1995 for the three Minnesota funds was as follows: Minnesota Municipal Income
Fund, Inc. was 9.7%; Minnesota Municipal Income Fund II, Inc. was 10.2%; and
Minnesota Municipal Income Fund III, Inc. was 9.6%. The total investment return
at net asset value for the first quarter of 1995 for the three Minnesota funds
was as follows: Minnesota Municipal Income Fund, Inc. was 11.5%; Minnesota
Municipal Income Fund II, Inc. was 14.7%; and Minnesota Municipal Income Fund
III, Inc. was 14.1%. During the first three months of 1995, the portfolio
manager realigned the portfolios to increase the coupon income of the funds. The
average credit quality remains high at Aa/AA and call protection is still very
strong.
In closing the discussion on the Minnesota Municipal Income Funds, one pending
legislative issue is worth noting. Minnesota House Bill 1380 was proposed
initially as a tax bill which would eliminate the exemption from Minnesota
personal income tax interest income generated by in-state municipal bonds issued
and/or purchased after July 1, 1995. At the time of this report's distribution,
this potential threat to the present tax exempt status of income produced by
Minnesota municipal bonds has largely subsided. If this bill in its diluted form
survives the legislative process, it will have a very minor affect, if any, on
Voyageur's Minnesota funds.
VOYAGEUR ARIZONA MUNICIPAL INCOME FUND, INC.: In 1994, municipal bonds in
Arizona had their lowest issuance volume in 10 years. Consecutive rounds of
refundings beginning in 1991, as interest rates fell, accounted for the growing
scarcity of municipal bonds in the state. Last year, the refunding bandwagon
slowed to a dead stop. Due to rising interest rates, the cost savings associated
with refunding were moot.
With inflows of new residents and new industries to the state, prosperity
continued. Due to this growth, two particular sectors of bonds, education and
water and sewer, have added value to this portfolio through their credit
worthiness and security.
The volatility of the bond market caused the Arizona Municipal Income Fund, Inc.
to deteriorate in value dramatically throughout much of 1994. Most of the
investment losses were recouped in the first quarter of 1995. The total
investment return based on net asset value for the past 12 months for this fund
was 11.3%. The total investment return at net asset value for the first quarter
of 1995 for this fund was 15.3%.
VOYAGEUR FLORIDA INSURED MUNICIPAL INCOME FUND: The state's economy continues to
prosper. The prosperity, coupled with somewhat lower labor costs, has attracted
industries to the state. Water and sewer bonds have been a staple in this
portfolio this reporting period.
The volatility of the bond market caused the Florida Insured Municipal Income
Fund to deteriorate in value dramatically throughout much of 1994. Most of the
investment losses were recouped in the first quarter of 1995. The total
investment return at net asset value for the past 12 months for this fund was
12.6%. The total investment return at net asset value for the first quarter of
1995 for this fund was 15.0%.
VOYAGEUR COLORADO INSURED MUNICIPAL INCOME FUND, INC.: Colorado's economy
continued to boom. Unemployment was down, productivity was up, and population
growth continued. The portfolio was heavily weighted with general obligation
bonds and health care bonds. In the general obligation sector, school district
bonds became more plentiful due to pre-refunding. Hospital bonds in the state
were a good value for the portfolio. The high quality of these bonds contributed
not only to the credit quality of the portfolio, but will provide the
opportunity for trading, when repositioning the portfolio is necessary.
The volatility of the bond market caused the Colorado Insured Municipal Income
Fund, Inc. to deteriorate in value dramatically throughout much of 1994. Most of
the investment losses were recouped in the first quarter of 1995. The total
investment return at net asset value for the past 12 months for this fund was
9.7%. The total investment return at net asset value for the first quarter of
1995 for this fund was 12.1%.
OUTLOOK
Voyageur's outlook for the economy for the remainder of 1995 is positive for
bond investors. We have begun the fifth year of an economic expansion and
believe the economy's growth will slow to 3.0 to 3.5% (the Fed's target is
2.5%). Inflationary pressures should peak sometime in mid 1995. As we move into
1996, we expect to avoid an economic recession and look forward to continued,
non-inflationary Gross Domestic Product growth of 2.5 to 3.0%. In our opinion,
the Fed can successfully engineer a soft landing. In all, we anticipate the
economic expansion will continue in a low inflation environment.
Helping the tax exempt bond market is the noticeable shortage of bonds in the
marketplace. New issuance of municipal bonds is down approximately 50% from the
1993 levels. The supply of bonds in the secondary market is light, as positive
cash flows into bond mutual funds have caused fund managers to become net buyers
of bonds rather than net sellers. We anticipate the total supply of tax exempt
bonds--both new issue and secondary market--will remain light for the balance of
1995. New issuance is averaging $12 billion to $18 billion per month in 1995. In
June and July of this year, approximately $80 billion ($40 billion each month)
of municipal bonds will be called or redeemed out of the market. On a net basis,
there will be more bonds retired this year than issued. This bodes well for
price support of outstanding bonds.
VOYAGEUR MINNESOTA MUNICIPAL INCOME FUND
For electronic filing purposes, the following is a representation of the graphic
chart shown in the printed copy.
Market Price/NAV Fluctuation from 4/1/94 through 3/31/95
Market
Price NAV
4/1/94 15.625 13.89
15.125 13.9
15 13.83
14.875 13.95
14.75 13.86
14.375 13.7
14.5 13.66
15 14.01
14.875 14.1
14.875 14.36
15 14.41
15 14.22
14.75 13.97
14.75 13.83
14.875 13.83
14.75 13.98
14.875 14.03
14.375 14.04
13.875 14.04
13.75 13.83
14 14
13.625 14.08
13.625 13.85
13.375 13.74
13.125 13.63
12.875 13.58
12.25 13.35
13 13.53
12.625 13.35
12.875 13.01
12.75 12.55
12.125 12.18
12.75 12.03
12.875 12.23
13.375 12.75
13.125 12.83
13.5 12.86
13.125 12.87
13.125 12.96
13.125 13.03
13.375 13.27
13.875 13.28
14 13.47
14.25 13.85
14.25 13.86
14.25 13.92
14.625 14.07
14.5 14.1
14.5 14.11
14.375 14.21
14.25 14.2
14.5 14.21
For electronic filing purposes, the following is a representation of the graphic
pie chart shown in the printed copy.
Sector Weightings/Credit Quality as of 3/31/95
(as a percentage of long-term securities)
Sector Breakdown
Housing 23%
Health Care 18%
General Obligation 17%
Education 9%
Utility 14%
Pre-Refunded/Escrowed 10%
Pollution Control 3%
Industrial 6%
Aaa/AAA Aa/AA A/A NR/NR
58% 13% 22% 7%
Portfolio Statistics as of 3/31/95
(excluding short-term securities)
Average Effective Maturity 14.4 Years
Duration 8.6 Years
% AMT 16.6%
Total Market Value $56.0 Million
Average Coupon 6.5%
Average Annual Fund Performance:
Market Value*
One Year (0.71)%
Since Inception (5/1/92) 7.82%
Net Asset Value**
One Year 9.72%
Since Inception (5/1/92) 7.56%
* Assumes purchase of common shares at market price on the first day and sale
on the last day of the period and reinvestment of dividends at market
price, if any. Performance does not reflect initial sales charge or
brokerage commissions.
** Assumes purchase of common share at net asset value on the first day and
sale on the last day of the period and reinvestment of dividends at net
asset value if any.
VOYAGEUR MINNESOTA MUNICIPAL INCOME FUND II
For electronic filing purposes, the following is a representation of the graphic
chart shown in the printed copy.
Market Price/NAV Fluctuation from 4/1/94 through 3/31/95
Market
Price NAV
4/1/94 14.625 12.73
13.75 12.71
13.5 12.68
13.625 12.77
13.625 12.67
13.5 12.45
13 12.42
13.5 12.83
14 12.92
14 13.2
13.625 13.29
13.125 13.04
13.25 12.71
13.375 12.57
12.5 12.57
12 12.77
12.625 12.8
12.125 13
12.5 12.81
12.125 12.58
12.25 12.66
12.75 12.76
12.125 12.88
11.625 12.56
12.125 12.45
11.375 12.34
11 12.28
10.875 12.05
11.375 12.26
11.25 12.03
11.125 11.67
10.75 11.14
10.375 10.78
10.625 10.58
10.875 10.81
11 11.34
10.875 11.42
10.75 11.5
10.625 11.55
10.75 11.62
11.625 11.73
11.75 12
11.5 12.03
12 12.23
11.875 12.69
12 12.7
11.875 12.81
12.375 12.97
12.375 13.01
12.25 12.99
12.25 13.16
12 13.14
12.375 13.12
For electronic filing purposes, the following is a representation of the graphic
pie chart shown in the printed copy.
Sector Weightings/Credit Quality as of 3/31/95
(as a percentage of long-term securities)
Sector Breakdown
Housing 20%
Health Care 20%
General Obligation 21%
Education 9%
Utility 7%
Pre-Refunded/Escrowed 11%
Pollution Control 2%
Industrial 10%
Aaa/AAA Aa/AA A/A NR/NR
59% 12% 23% 6%
Portfolio Statistics as of 3/31/95
(excluding short-term securities)
Average Effective Maturity 19.8 Years
Duration 10.6 Years
% AMT 19.9%
Total Market Value $153.1 Million
Average Coupon 6.2%
Average Annual Fund Performance:
Market Value*
One Year (9.59)%
Since Inception (2/26/93) (0.15)%
Net Asset Value**
One Year 10.16%
Since Inception (2/26/93) 2.88%
* Assumes purchase of common shares at market price on the first day and sale
on the last day of the period and reinvestment of dividends at market
price, if any. Performance does not reflect initial sales charge or
brokerage commissions.
** Assumes purchase of common share at net asset value on the first day and
sale on the last day of the period and reinvestment of dividends at net
asset value if any.
VOYAGEUR MINNESOTA MUNICIPAL INCOME FUND III
For electronic filing purposes, the following is a representation of the graphic
chart shown in the printed copy.
Market Price/NAV Fluctuation from 4/1/94 through 3/31/95
Market
Price NAV
4/1/94 14 11.86
13.125 11.79
12.875 11.73
12.75 11.86
13 11.77
12 11.56
11.5 11.53
12.375 11.92
12.375 11.99
12 12.27
12.5 12.29
12.5 12.06
12 11.81
12.375 11.67
11.75 11.65
11.375 11.83
11.125 11.88
10.75 12.05
11.125 11.88
11 11.7
11.25 11.77
11.5 11.85
11.375 11.95
11 11.67
10.75 11.56
10.75 11.42
10.5 11.38
10.25 11.17
10.25 11.38
10.625 11.19
9.875 10.84
9.75 10.39
9 10.08
10 9.86
10.125 10.06
10 10.57
9.25 10.65
10 10.72
9.75 10.77
10 10.86
10.125 10.93
10.375 11.15
11 11.2
11 11.4
10.75 11.84
11.125 11.82
11.5 11.91
11.5 12.07
11.375 12.09
10.625 12.05
11 12.23
10.75 12.2
11.25 12.2
For electronic filing purposes, the following is a representation of the graphic
pie chart shown in the printed copy.
Sector Weightings/Credit Quality as of 3/31/95
(as a percentage of long-term securities)
Sector Breakdown
Housing 22%
Health Care 15%
General Obligation 16%
Education 9%
Utility 14%
Pre-Refunded/Escrowed 9%
Industrial 13%
Aaa/AAA Aa/AA A/A NR/NR
51% 14% 32% 3%
Portfolio Statistics as of 3/31/95
(excluding short-term securities)
Average Effective Maturity 17.0 Years
Duration 9.8 Years
% AMT 13.7%
Total Market Value $36.9 Million
Average Coupon 6.2%
Average Annual Fund Performance:
Market Value*
One Year (14.27)%
Since Inception (10/29/93) (9.33)%
Net Asset Value**
One Year 9.55%
Since Inception(10/29/93) (4.00)%
* Assumes purchase of common shares at market price on the first day and sale
on the last day of the period and reinvestment of dividends at market
price, if any. Performance does not reflect initial sales charge or
brokerage commissions.
** Assumes purchase of common share at net asset value on the first day and
sale on the last day of the period and reinvestment of dividends at net
asset value if any.
VOYAGEUR ARIZONA MUNICIPAL INCOME FUND
For electronic filing purposes, the following is a representation of the graphic
chart shown in the printed copy.
Market Price/NAV Fluctuation from 4/1/94 through 3/31/95
Market
Price NAV
4/1/94 13.875 12.71
13.375 12.76
13 12.72
13.375 12.79
13.125 12.69
13 12.49
13 12.45
13.125 12.85
13.25 12.9
13.125 13.19
12.875 13.3
12.5 13.05
12.125 12.67
12 12.54
12.375 12.54
11.875 12.73
11.875 12.76
12.25 13
12.875 12.85
12.75 12.63
12.375 12.72
12.5 12.83
12.75 12.95
12.25 12.59
12 12.44
12 12.31
11.625 12.28
11.625 12.01
11.5 12.23
11.125 12.03
10.875 11.68
11 11.14
10.375 10.68
10.5 10.51
10.625 10.81
10.75 11.39
11.25 11.41
10.875 11.48
10.375 11.54
10.75 11.63
11.25 11.71
11.375 12.03
11.875 12.04
12.25 12.3
11.875 12.76
11.75 12.8
12.25 12.92
12.375 13.09
12.25 13.05
12 13.05
12.25 13.27
12.125 13.24
12.125 13.26
For electronic filing purposes, the following is a representation of the graphic
pie chart shown in the printed copy.
Sector Weightings/Credit Quality as of 3/31/95
(as a percentage of long-term securities)
Sector Breakdown
Housing 8%
Health Care 17%
General Obligation 17%
Education 11%
Utility 27%
Transportation 8%
Sales Tax 2%
Lease 4%
Industrial 6%
Aaa/AAA Aa/AA A/A
72% 27% 1%
Portfolio Statistics as of 3/31/95
(excluding short-term securities)
Average Effective Maturity 17.4 Years
Duration 10.3 Years
% AMT 0.0%
Total Market Value $63.1 Million
Average Coupon 5.8%
Average Annual Fund Performance:
Market Value*
One Year (6.43)%
Since Inception (2/26/93) (0.72)%
Net Asset Value**
One Year 11.29%
Since Inception (2/26/93) 3.50%
* Assumes purchase of common shares at market price on the first day and sale
on the last day of the period and reinvestment of dividends at market
price, if any. Performance does not reflect initial sales charge or
brokerage commissions.
** Assumes purchase of common share at net asset value on the first day and
sale on the last day of the period and reinvestment of dividends at net
asset value if any.
VOYAGEUR FLORIDA INSURED MUNICIPAL INCOME FUND
For electronic filing purposes, the following is a representation of the graphic
chart shown in the printed copy.
Market Price/NAV Fluctuation from 4/1/94 through 3/31/95
Market
Price NAV
4/1/94 12.5 12.47
11.75 12.64
12.375 12.55
12.875 12.63
12.625 12.5
12.625 12.33
12 12.28
12.25 12.71
12.5 12.79
12.25 13.08
12.25 13.3
12.625 13.02
12.5 12.56
11.75 12.42
12 12.41
12 12.63
12.125 12.59
11.625 12.82
11.875 12.66
11.5 12.44
11.75 12.48
11.75 12.58
12.5 12.7
12.375 12.35
11.75 12.19
11.25 12.05
11.125 12
10.75 11.76
11.125 12.02
10.625 11.79
10.75 11.41
10.875 10.87
10.625 10.44
10.625 10.28
10.5 10.64
10.625 11.32
10.75 11.3
10.625 11.45
10.125 11.54
10.25 11.63
11 11.7
11.25 12
11.25 11.99
11.5 12.24
11.75 12.87
12.25 12.92
12 12.94
12.375 13.06
12.125 13.03
12.25 12.96
12.125 13.22
11.75 13.17
12.25 13.17
For electronic filing purposes, the following is a representation of the graphic
pie chart shown in the printed copy.
Sector Weightings/Credit Quality as of 3/31/95
(as a percentage of long-term securities)
Sector Breakdown
Health Care 18%
General Obligation 8%
Utility 36%
Transportation 8%
Pre-Refunded/Escrowed 1%
Miscellaneous and
Sales Tax 25%
Industrial 4%
Aaa/AAA
100%
Portfolio Statistics as of 3/31/95
(excluding short-term securities)
Average Effective Maturity 20.6 Years
Duration 11.4 Years
% AMT 0.0%
Total Market Value $51.2 Million
Average Coupon 5.6%
Average Annual Fund Performance:
Market Value*
One Year 4.69%
Since Inception (2/26/93) (0.96)%
Net Asset Value**
One Year 12.56%
Since Inception (2/26/93) 2.45%
* Assumes purchase of common shares at market price on the first day and sale
on the last day of the period and reinvestment of dividends at market
price, if any. Performance does not reflect initial sales charge or
brokerage commissions.
** Assumes purchase of common share at net asset value on the first day and
sale on the last day of the period and reinvestment of dividends at net
asset value if any.
VOYAGEUR COLORADO INSURED MUNICIPAL INCOME FUND
For electronic filing purposes, the following is a representation of the graphic
chart shown in the printed copy.
MARKET PRICE/NAV FLUCTUATION FROM 4/1/94 THROUGH 3/31/95
Market
Price NAV
4/1/94 14.5 12.8
13.625 12.78
14 12.75
13.875 12.91
14.125 12.75
13.875 12.57
13.5 12.55
14 12.9
14 12.99
13.625 13.25
13.75 13.32
13.5 13.09
13.25 12.83
12.875 12.71
12.5 12.71
12.625 12.88
12.625 12.92
12.75 13.12
12.75 12.94
12.75 12.78
12.875 12.87
12.625 12.94
12.5 13.05
12.5 12.74
12.375 12.62
12.125 12.49
12.25 12.96
12.125 12.26
12 12.47
11.75 12.28
11.25 12
11.125 11.37
10.625 11
10.375 10.85
11.125 11.15
10.375 11.67
10.625 11.75
10.875 11.8
11 11.84
11 11.93
11.75 12.02
11.875 12.27
11.625 12.31
12 12.49
12.125 12.84
12 12.84
11.75 12.98
12.25 13.12
12 13.06
12.25 13.11
12.375 13.23
12.375 13.17
12.25 13.19
For electronic filing purposes, the following is a representation of the graphic
pie chart shown in the printed copy.
Sector Weightings/Credit Quality as of 3/31/95
(as a percentage of long-term securities)
Sector Breakdown
Housing 3%
Health Care 27%
General Obligation 14%
Education 21%
Utility 10%
Pre-Refunded/Escrowed 9%
Pollution Control 11%
Miscellaneous and
Sales Tax 5%
Aaa/AAA
100%
Portfolio Statistics as of 3/31/95
(excluding short-term securities)
Average Effective Maturity 14.4 Years
Duration 8.9 Years
% AMT 0.0%
Total Market Value $101.3 Million
Average Coupon 5.6%
Average Annual Fund Performance:
Market Value*
One Year (10.05)%
Since Inception (7/29/93) (3.08)%
Net Asset Value**
One Year 9.67%
Since Inception (7/29/93) 1.41%
* Assumes purchase of common shares at market price on the first day and sale
on the last day of the period and reinvestment of dividends at market
price, if any. Performance does not reflect initial sales charge or
brokerage commissions.
** Assumes purchase of common share at net asset value on the first day and
sale on the last day of the period and reinvestment of dividends at net
asset value if any.
INDEPENDENT AUDITORS' REPORT
The Board of Directors or Trustees and Shareholders
Voyageur Minnesota Municipal Income Fund, Inc.
Voyageur Minnesota Municipal Income Fund II, Inc.
Voyageur Minnesota Municipal Income Fund III, Inc.
Voyageur Arizona Municipal Income Fund, Inc.
Voyageur Florida Insured Municipal Income Fund
Voyageur Colorado Insured Municipal Income Fund, Inc.:
We have audited the accompanying statements of assets and liabilities,
including the schedules of investments in securities of Voyageur Minnesota
Municipal Income Fund, Inc., Voyageur Minnesota Municipal Income Fund II, Inc.,
Voyageur Minnesota Municipal Income Fund III, Inc., Voyageur Arizona Municipal
Income Fund, Inc., Voyageur Florida Insured Municipal Income Fund and Voyageur
Colorado Insured Municipal Income Fund, Inc. (the Funds) as of March 31, 1995
and the related statements of operations for the year then ended and the
statements of changes in net assets for each of the years in the two-year period
ended March 31, 1995 (for the year ended March 31, 1995 and for the period from
October 29, 1993, commencement of investment operations, to March 31, 1994 for
Voyageur Minnesota Municipal Income Fund III, Inc. and for the year ended March
31, 1995 and for the period from July 29, 1993, commencement of investment
operations, to March 31, 1994 for Voyageur Colorado Insured Municipal Income
Fund, Inc.) and the financial highlights for each of the periods presented.
These financial statements and the financial highlights are the responsibility
of the Funds' management. Our responsibility is to express an opinion on these
financial statements and the financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and the financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements and the financial highlights. Investment securities held in custody
are confirmed to us by the custodian. As to securities purchased and sold, but
not received or delivered, we request confirmations from brokers, and where
replies are not received, we carry out other appropriate auditing procedures. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements and the financial highlights
referred to above present fairly, in all material respects, the financial
position of Voyageur Minnesota Municipal Income Fund, Inc., Voyageur Minnesota
Municipal Income Fund II, Inc., Voyageur Minnesota Municipal Income Fund III,
Inc., Voyageur Arizona Municipal Income Fund, Inc., Voyageur Florida Insured
Municipal Income Fund and Voyageur Colorado Insured Municipal Income Fund, Inc.
as of March 31, 1995 and the results of their operations, changes in their net
assets and the financial highlights for the periods stated in the first
paragraph above, in conformity with generally accepted accounting principles.
KPMG Peat Marwick LLP
Minneapolis, Minnesota
April 28, 1995
THE VOYAGEUR FUNDS
STATEMENTS OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
VOYAGEUR
MINNESOTA
MUNICIPAL
INCOME
FUND, INC.
ASSETS
<S> <C>
Investments in securities (note 2) (identified cost:
$56,410,564, $159,831,762, $37,888,127, $63,817,219,
$52,287,913 and $104,823,540, respectively)............................................. $57,496,457
Cash in bank on demand deposit........................................................... 621
Receivable for investment securities sold ................................................ --
Accrued interest receivable............................................................... 939,111
Total assets............................................................................ 58,436,189
LIABILITIES
Disbursements in excess of cash in bank on demand deposit................................. --
Payable for investment securities purchased............................................... 1,401,182
Dividends payable to preferred shareholders............................................... 59,768
Administration fee payable................................................................ 8,446
Other accrued expenses.................................................................... 86,267
Total liabilities....................................................................... 1,555,663
NET ASSETS APPLICABLE TO OUTSTANDING CAPITAL SHARES..................................... $56,880,526
Represented by:
Preferred shares (note 5)............................................................... $20,000,000
Common shares:
Par value............................................................................. 25,947
Additional paid-in capital............................................................ 35,452,118
55,478,065
Undistributed net investment income..................................................... 476,566
Accumulated net realized loss from investments.......................................... (159,998)
Unrealized net appreciation (depreciation) of investments............................... 1,085,893
TOTAL REPRESENTING NET ASSETS APPLICABLE TO OUTSTANDING
CAPITAL SHARES...................................................................... $56,880,526
TOTAL REPRESENTING NET ASSETS APPLICABLE TO OUTSTANDING
COMMON SHARES....................................................................... $36,880,526
NET ASSET VALUE PER COMMON SHARE:
(2,594,700, 7,252,200, 1,837,200, 2,982,200, 2,422,200 and
4,837,100 common shares issued and outstanding, respectively)........................... $14.21
</TABLE>
THE VOYAGEUR FUNDS
STATEMENTS OF ASSETS AND LIABILITIES (TABLE CONTINUED)
<TABLE>
<CAPTION>
MARCH 31, 1995
VOYAGEUR VOYAGEUR
VOYAGEUR VOYAGEUR VOYAGEUR FLORIDA COLORADO
MINNESOTA MINNESOTA ARIZONA INSURED INSURED
MUNICIPAL MUNICIPAL MUNICIPAL MUNICIPAL MUNICIPAL
INCOME INCOME INCOME INCOME INCOME
FUND II, INC. FUND III, INC. FUND, INC. FUND FUND, INC.
<S> <C> <C> <C> <C> <C>
$157,270,193 $36,912,220 $63,116,176 $51,152,717 $101,341,233
792 -- 330,279 -- 1,539,190
7,033,518 -- 196,972 -- --
2,367,958 614,472 983,621 952,456 2,073,185
166,672,461 37,526,692 64,627,048 52,105,173 104,953,608
-- 35,156 -- 38,378 --
11,122,272 -- -- -- 979,922
184,800 -- 77,193 62,904 123,200
19,715 4,751 8,181 6,587 13,200
206,421 68,337 103,304 105,905 56,013
11,533,208 108,244 188,678 213,774 1,172,335
$155,139,253 $37,418,448 $64,438,370 $51,891,399 $103,781,273
$ 60,000,000 $15,000,000 $25,000,000 $20,000,000 $40,000,000
72,522 18,372 29,822 24,222 48,371
99,637,602 25,228,358 40,809,143 33,337,167 67,189,739
159,710,124 40,246,730 65,838,965 53,361,389 107,238,110
523,703 119,531 152,133 142,773 331,186
(2,533,005) (1,971,906) (851,685) (477,567) (305,716)
(2,561,569) (975,907) (701,043) (1,135,196) (3,482,307)
$155,139,253 $37,418,448 $64,438,370 $51,891,399 $103,781,273
$95,139,253 $22,418,448 $39,438,370 $31,891,399 $ 63,781,273
$13.12 $12.20 $13.22 $13.17 $13.19
</TABLE>
See accompanying notes to financial statements.
THE VOYAGEUR FUNDS
STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
VOYAGEUR
MINNESOTA
MUNICIPAL
INCOME
FUND, INC.
Investment income:
<S> <C>
Interest ............................................................................... $ 3,603,892
Expenses (note 4):
Investment advisory and management fees................................................. 221,352
Administration fees..................................................................... 100,000
Custodian and transfer agent fees....................................................... 31,517
Audit and legal fees.................................................................... 23,558
Remarketing agent fees.................................................................. 50,000
Other expenses.......................................................................... 42,642
Total expenses....................................................................... 469,069
Investment income - net........................................................... 3,134,823
Realized and unrealized gain (loss) on investments:
Realized loss on investments - net (note 3)............................................. (84,971)
Change in unrealized appreciation or depreciation of investments - net.................. 967,947
Net gain on investments.............................................................. 882,976
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS.............................. $ 4,017,799
</TABLE>
See accompanying notes to financial statements.
THE VOYAGEUR FUNDS
STATEMENTS OF OPERATIONS (TABLE CONTINUED)
<TABLE>
<CAPTION>
YEAR ENDED MARCH 31, 1995
VOYAGEUR VOYAGEUR
VOYAGEUR VOYAGEUR VOYAGEUR FLORIDA COLORADO
MINNESOTA MINNESOTA ARIZONA INSURED INSURED
MUNICIPAL MUNICIPAL MUNICIPAL MUNICIPAL MUNICIPAL
INCOME INCOME INCOME INCOME INCOME
FUND II, INC. FUND III, INC. FUND, INC. FUND FUND, INC.
<S> <C> <C> <C> <C> <C>
$ 9,210,829 $2,235,658 $3,704,795 $2,989,792 $5,682,829
599,011 144,494 247,857 198,827 402,784
224,633 54,113 92,946 74,559 151,044
63,911 15,273 17,093 17,311 21,282
56,384 19,112 28,279 23,953 42,772
150,000 37,500 62,500 50,000 100,000
51,729 25,989 40,440 37,824 50,057
1,145,668 296,481 489,115 402,474 767,939
8,065,161 1,939,177 3,215,680 2,587,318 4,914,890
(2,497,147) (1,952,146) (792,377) (397,089) (305,716)
5,289,520 2,459,010 2,483,456 2,076,303 2,419,647
2,792,373 506,864 1,691,079 1,679,214 2,113,931
$10,857,534 $2,446,041 $4,906,759 $4,266,532 $7,028,821
</TABLE>
See accompanying notes to financial statements.
THE VOYAGEUR FUNDS
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
VOYAGEUR VOYAGEUR
MINNESOTA MINNESOTA
MUNICIPAL MUNICIPAL
INCOME INCOME
FUND, INC. FUND II, INC.
YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED
MARCH 31, MARCH 31, MARCH 31, MARCH 31,
1995 1994 1995 1994
<S> <C> <C> <C> <C>
OPERATIONS:
Investment income - net ................................ $ 3,134,823 $ 3,119,891 $ 8,065,161 $ 7,115,804
Realized gain (loss) on investments - net .............. (84,971) 394,120 (2,497,147) 176,796
Change in unrealized appreciation or
depreciation of investments - net .................... 967,947 (2,177,560) 5,289,520 (7,128,993)
Net increase (decrease) in net assets
resulting from operations ............................ 4,017,799 1,336,451 10,857,534 163,607
DISTRIBUTIONS TO:
Common shareholders from investment income - net ....... (2,413,073) (2,413,067) (5,983,068) (5,484,482)
Preferred shareholders from investment income - net .... (684,186) (467,020) (2,061,072) (1,320,876)
Common shareholders from realized capital gains - net .. (61,368) (413,901) -- (119,329)
Preferred shareholders from realized capital gains - net (12,894) (83,312) -- (27,774)
Total distributions ................................ (3,171,521) (3,377,300) (8,044,140) (6,952,461)
CAPITAL SHARE TRANSACTIONS (NOTE 5):
Net proceeds from initial public
offering of shares ................................... -- -- -- --
Net proceeds from underwriters'
over-allotment option ................................ -- -- -- --
Net proceeds from preferred share issuance ............. -- -- -- 58,722,934
Final adjustment of offering costs
relating to initial public offering .................. -- -- -- --
Total increase (decrease) in net assets ............ 846,278 (2,040,849) 2,813,394 51,934,080
Net assets at beginning of period ...................... 56,034,248 58,075,097 152,325,859 100,391,779
Net assets at end of period (including undistributed net
investment income of $476,566 and $439,002, $523,703
and $502,682, $119,531 and $17,824, $152,133
and $108,259, $142,773 and $119,935 and $331,186
and $420,003, respectively) .......................... $ 56,880,526 $ 56,034,248 $ 155,139,253 $ 152,325,859
</TABLE>
* Commencement of investment operations
See accompanying notes to financial statements.
THE VOYAGEUR FUNDS
STATEMENTS OF CHANGES IN NET ASSETS (TABLE CONTINUED)
<TABLE>
<CAPTION>
VOYAGEUR VOYAGEUR
VOYAGEUR VOYAGEUR FLORIDA COLORADO
MINNESOTA ARIZONA INSURED INSURED
MUNICIPAL MUNICIPAL MUNICIPAL MUNICIPAL
INCOME INCOME INCOME INCOME
FUND III, INC. FUND, INC. FUND FUND, INC.
PERIOD FROM PERIOD FROM
YEAR OCTOBER 29, YEAR YEAR YEAR YEAR YEAR JULY 29,
ENDED 1993* TO ENDED ENDED ENDED ENDED ENDED 1993* TO
MARCH 31, MARCH 31, MARCH 31, MARCH 31, MARCH 31, MARCH 31, MARCH 31, MARCH 31,
1995 1994 1995 1994 1995 1994 1995 1994
<S><C> <C> <C> <C> <C> <C> <C> <C>
$1,939,177 $ 590,170 $ 3,215,680 $ 2,851,463 $ 2,587,318 $ 2,343,243 $ 4,914,890 $ 2,858,621
(1,952,146) (19,760) (792,377) 431,905 (397,089) (80,478) (305,716) 166,721
2,459,010 (3,434,917) 2,483,456 (2,785,811) 2,076,303 (2,581,761) 2,419,647 (5,901,954)
2,446,041 (2,864,507) 4,906,759 497,557 4,266,532 (318,996) 7,028,821 (2,876,612)
(1,331,970) (459,300) (2,329,844) (2,255,289) (1,871,152) (1,798,485) (3,658,059) (1,904,610)
(505,500) (113,046) (841,962) (532,460) (693,328) (459,562) (1,345,648) (534,008)
-- -- (140,052) (254,257) -- -- (128,941) --
-- -- (37,501) (59,403) -- -- (37,780) --
(1,837,470) (572,346) (3,349,359) (3,101,409) (2,564,480) (2,258,047) (5,170,428) (2,438,618)
-- 22,991,250 -- -- -- -- -- 59,030,000
-- 2,524,500 -- -- -- -- -- 8,883,000
-- 14,605,000 -- 24,422,275 -- 19,519,479 -- 39,225,000
25,000 -- -- -- -- -- -- --
633,571 36,683,897 1,557,400 21,818,423 1,702,052 16,942,436 1,858,393 101,822,770
36,784,877 100,980 62,880,970 41,062,547 50,189,347 33,246,911 101,922,880 100,110
$ 37,418,448 $ 36,784,877 $ 64,438,370 $ 62,880,970 $ 51,891,399 $ 50,189,347 $ 103,781,273 $ 101,922,880
</TABLE>
* Commencement of investment operations
See accompanying notes to financial statements.
THE VOYAGEUR FUNDS
NOTES TO FINANCIAL STATEMENTS
(1) ORGANIZATION
Voyageur Minnesota Municipal Income Fund, Inc. ("Minnesota Municipal");
Voyageur Minnesota Municipal Income Fund II, Inc. ("Minnesota Municipal II");
Voyageur Minnesota Municipal Income Fund III, Inc. ("Minnesota Municipal III");
Voyageur Arizona Municipal Income Fund, Inc. ("Arizona Municipal"); Voyageur
Florida Insured Municipal Income Fund ("Florida Insured Municipal"); and
Voyageur Colorado Insured Municipal Income Fund, Inc. ("Colorado Insured
Municipal") (collectively the "Funds") are registered under the Investment
Company Act of 1940 (as amended) ("1940 Act") as closed-end diversified
management investment companies (except Minnesota Municipal, Minnesota Municipal
III and Colorado Insured Municipal, which are non-diversified management
investment companies). Minnesota Municipal III and Colorado Insured Municipal
had no operations until October 19, 1993 and July 16, 1993 when they sold 7,200
and 7,100 common shares for $100,980 and $100,110, respectively, to Voyageur
Fund Managers, Inc. (the "Adviser"). Shares of the Funds are listed on the
American Stock Exchange.
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The significant accounting policies followed by the Funds are as follows:
Investments in Securities
The values of fixed-income securities are determined using pricing services
or prices quoted by independent brokers. When market quotations are not readily
available, securities are valued at fair value according to methods selected in
good faith by the Board of Directors or Trustees. Short-term securities with
maturities less than 60 days when acquired, or which subsequently are within 60
days of maturity, are valued at amortized cost which approximates market value.
Securities transactions are accounted for on the date the securities are
purchased or sold. Realized gains and losses are calculated on the identified
cost basis. Interest income, including level-yield amortization of premium and
original issue discount, is accrued daily.
The Funds concentrate their investments in their respective states.
Therefore, there may be more credit risk related to the economic conditions of a
particular state than a portfolio with broader geographical diversification.
Federal Taxes
The Funds intend to comply with the requirements of the Internal Revenue Code
applicable to regulated investment companies and to distribute substantially all
of their taxable net investment income and net realized capital gains, if any,
to shareholders in amounts that will avoid or minimize federal income or excise
taxes for the Funds. Net investment income and net realized gains (losses) for
the Funds may differ for financial statement and tax purposes primarily because
of losses deferred for tax purposes due to "wash sale" transactions. The
character of distributions made during the year from net investment income or
net realized gains may differ from their ultimate characterization for federal
income tax purposes. Also, due to the timing of dividend distributions, the
fiscal year in which amounts are distributed may differ from the year that the
income or realized gains (losses) were recorded by the Funds.
Distributions to Shareholders
The Funds intend to pay monthly dividends from net investment income. Net
realized capital gains, if any, will be distributed on an annual basis. These
distributions are recorded as of the close of business on the ex-dividend date.
Such distributions are payable in cash or, pursuant to the Funds' Dividend
Reinvestment Plans, reinvested in additional common shares of the Funds. Under
the Plans, shares of the Funds will be purchased in the open market.
(3) INVESTMENT SECURITIES TRANSACTIONS
Purchases of securities and proceeds from sales, other than investments in
short-term securities, for Minnesota Municipal, Minnesota Municipal II,
Minnesota Municipal III, Arizona Municipal, Florida Insured Municipal and
Colorado Insured Municipal were $7,255,921 and $7,286,506, $49,009,119 and
$48,091,029, $17,196,440 and $16,905,145, $10,995,748 and $11,288,365,
$5,260,664 and $4,938,015, and $6,144,324 and $6,700,205, respectively, for the
year ended March 31, 1995.
(4) FEES AND EXPENSES
The Funds have entered into the following agreements with the Adviser,
and with Mitchell Hutchins Asset Management Inc. (Middlesex Administrators L.P.
on Colorado Insured Municipal only) (the "Administrators").
The investment advisory agreements provide the Adviser with a monthly
investment management fee computed at an annual rate of .40% of each Fund's
average daily net assets, including assets attributable to any preferred stock
that may be outstanding. For its fee, the Adviser will provide investment advice
and, in general, will conduct the management and investments of the Funds.
The administration agreements provide the Administrators with a monthly
fee computed at an annual rate of .15% of each Fund's average daily net assets,
including assets attributable to any preferred stock that may be outstanding.
Certain Funds have minimum annual fees payable to the Administrators. Minnesota
Municipal paid the annual minimum for the year ended March 31, 1995. For their
fees, the Administrators will provide certain administrative, clerical and
recordkeeping services for the Funds.
In addition to the advisory fees and administrative fees, the Funds are
responsible for paying most other operating expenses, including outside
directors' or trustees' fees and expenses, custodian fees, registration fees,
printing and shareholder reports, transfer agent fees and expenses, legal,
auditing and accounting services, insurance, interest and other miscellaneous
expenses.
(5) CAPITAL SHARES TRANSACTIONS
Pursuant to their articles of incorporation, Minnesota Municipal,
Minnesota Municipal II, Minnesota Municipal III, Arizona Municipal and Colorado
Insured Municipal each have 200 million shares of $0.01 par value common shares
authorized. Florida Insured Municipal has been authorized to issue an unlimited
amount of $0.01 par value common shares. The common shares outstanding at March
31, 1995 were 2,594,700 for Minnesota Municipal, 7,252,200 for Minnesota
Municipal II, 1,837,200 for Minnesota Municipal III, 2,982,200 for Arizona
Municipal, 2,422,200 for Florida Insured Municipal and 4,837,100 for Colorado
Insured Municipal. The Adviser owns 7,200 shares of Minnesota Municipal II,
Minnesota Municipal III, Arizona Municipal, and Florida Insured Municipal and
7,100 shares of Colorado Insured Municipal.
For the year ended March 31, 1995, there were no transactions in common
shares for the Funds.
Transactions in common shares for the period October 29, 1993
(commencement of investment operations) through March 31, 1994 for Minnesota
Municipal III and for the period July 29, 1993 (commencement of investment
operations) through March 31, 1994 for Colorado Insured Municipal were as
follows:
MINNESOTA MUNICIPAL III
Shares issued in connection with
the initial public offering......... 1,650,000
Shares issued in connection with
the exercise of the underwriters'
over-allotment option............... 180,000
Net increase in shares outstanding..... 1,830,000
COLORADO INSURED MUNICIPAL
Shares issued in connection with
the initial public offering......... 4,200,000
Shares issued in connection with
the exercise of the underwriters'
over-allotment option............... 630,000
Net increase in shares outstanding..... 4,830,000
Offering costs of approximately $190,000 and $190,000 incurred in connection
with the underwriting of the common shares of Minnesota Municipal III and
Colorado Insured Municipal, respectively, were charged to additional paid-in
capital during the period ended March 31, 1994.
The Funds each have 1 million shares of $0.01 par value preferred shares
authorized, except for Florida Insured Municipal which has an unlimited amount
of $0.01 par value preferred shares authorized. Under resolutions adopted by the
Board of Directors, Minnesota Municipal is allowed to issue up to 400 preferred
shares, of which the entire amount was issued on August 6, 1992. On May 14,
1993, Minnesota Municipal II, Arizona Municipal and Florida Insured Municipal
issued 1,200, 500 and 400 preferred shares, respectively. On December 10, 1993,
Minnesota Municipal III issued 300 preferred shares and on September 23, 1993,
Colorado Insured Municipal issued 800 preferred shares. The preferred shares
have a liquidation preference of $50,000 per share plus an amount equal to
accumulated but unpaid dividends.
The underwriting discounts of $1,050,000, $225,000, $437,500, $350,000 and
$600,000 and offering costs of $227,066, $105,000, $140,225, $130,521 and
$175,000 incurred in connection with the preferred shares offerings of Minnesota
Municipal II, Minnesota Municipal III, Arizona Municipal, Florida Insured
Municipal and Colorado Insured Municipal, respectively, have been charged to
additional paid-in capital of common shares.
Dividends for the outstanding preferred shares of each Fund are cumulative at
a rate established at the initial public offering and are typically reset every
28 days based on the results of an auction. Dividend rates (adjusted for capital
gains distributions) ranged from 2.50% to 5.00% on Minnesota Municipal, from
2.55% to 5.10% on Minnesota Municipal II, from 2.50% to 4.15% on Minnesota
Municipal III, from 2.80% to 4.50% on Arizona Municipal, from 2.80% to 4.50% on
Florida Insured Municipal and from 2.40% to 4.95% on Colorado Insured Municipal
during the year ended March 31, 1995. Smith Barney Inc. and Merrill Lynch
Pierce, Fenner & Smith Inc. (on Colorado Insured Municipal only), as the
remarketing agents, receive an annual fee from each of the Funds of .25% of the
average amount of preferred stock outstanding.
Under the 1940 Act, the Funds may not declare dividends or make other
distributions on common shares or purchase any such shares if, at the time of
the declaration, distribution or purchase, asset coverage with respect to the
outstanding preferred stock would be less than 200%.
Each of the Fund's preferred shares are redeemable at the option of the Fund,
in whole or in part, on any dividend payment date at $50,000 per share plus any
accumulated but unpaid dividends whether or not declared. The preferred shares
are also subject to mandatory redemption at $50,000 per share plus any
accumulated but unpaid dividends, whether or not declared, if certain
requirements relating to the composition of the assets and liabilities of each
of the Funds is not satisfied. The holders of preferred shares have voting
rights equal to the holders of common shares (one vote per share) and will vote
together with holders of common shares as a single class. However, holders of
preferred shares are also entitled to elect two of each Fund's directors or
trustees. In addition, the 1940 Act requires that along with approval by
shareholders that might otherwise be required, the approval of the holders of a
majority of any outstanding preferred shares, voting separately as a class would
be required to (a) adopt any plan of reorganization that would adversely affect
the preferred shares, and (b) take any action requiring a vote of security
holders pursuant to Section 13(a) of the 1940 Act, including, among other
things, changes in each of the Fund's subclassification as a closed-end
investment company or changes in their fundamental investment restrictions.
(6) CAPITAL LOSS CARRYFORWARDS
For federal income tax purposes, Minnesota Municipal, Minnesota Municipal II,
Minnesota Municipal III, Arizona Municipal, Florida Insured Municipal and
Colorado Insured Municipal had capital loss carryforwards of $159,998,
$2,493,771, $1,966,961, $851,685, $477,567 and $305,716, respectively, at March
31, 1995, that will expire in 2002 through 2004 if not offset by subsequent
capital gains. It is unlikely the Board of Directors or Trustees will authorize
a distribution of any net realized capital gains until the available capital
loss carryforwards have been offset or expire.
(7) FINANCIAL HIGHLIGHTS
Per share data (rounded to the nearest cent) for a share of common stock
outstanding and selected information for each period are as follows:
<TABLE>
<CAPTION>
MINNESOTA MUNICIPAL MINNESOTA MUNICIPAL II
PERIOD FROM PERIOD FROM
YEAR YEAR MAY 1, YEAR YEAR FEBRUARY 26,
ENDED ENDED 1992* TO ENDED ENDED 1993*TO
MARCH 31, MARCH 31, MARCH 31, MARCH 31, MARCH 31, MARCH 31,
<S> <C> <C> <C> <C> <C> <C>
Net asset value: 1995 1994 1993** 1995 1994 1993**
Beginning of period $ 13.89 $ 14.67 $ 13.95 $ 12.73 $ 13.84 $ 13.95
Operations:
Investment income - net 1.21 1.20 0.90 1.11 0.98 0.03
Realized and unrealized gain (loss) on
investments - net 0.34 (0.68) 1.00 0.39 (0.96) (0.11)
Total from operations 1.55 0.52 1.90 1.50 0.02 (0.08)
Distributions to:
Common shareholders from investment
income - net (0.93) (0.93) (0.70) (0.83) (0.76) --
Preferred shareholders from investment
income - net (0.27) (0.18) (0.12) (0.28) (0.18) --
Common shareholders from realized capital
gains - net (0.02) (0.16) (0.06) -- (0.02) --
Preferred shareholders from realized capital
gains - net (0.01) (0.03) (0.02) -- (0.00) --
Total distributions (1.23) (1.30) (0.90) (1.11) (0.96) --
Capital share transactions:
Capital charge with respect to issuance of shares -- -- (0.28) -- (0.17) (0.03)
Net asset value:
End of period $ 14.21 $ 13.89 $ 14.67 $ 13.12 $ 12.73 $ 13.84
Market value:
End of period $ 14.50 $ 15.63 $ 16.00 $ 12.38 $ 14.63 $ 15.13
Total investment return:
Market value (a) (0.71)% 4.28% 20.31% (9.59)% 1.71% 8.42%
Net asset value (b) 9.72% 1.63% 10.91% 10.16% (2.93)% (.79)%
Net assets applicable to outstanding capital shares
at end of period (000's omitted) $ 56,881 $ 56,034 $ 58,075 $ 155,139 $ 152,326 $ 100,392
Ratios/Supplemental Data:
Ratio of expenses to average net assets (c) 0.85% 0.78% 0.88%(d) 0.77% 0.76% 0.83%(d)
Ratio of investment income - net to
average net assets (c) 5.66% 5.22% 4.92%(d) 5.39% 4.54% 2.29%(d)
Portfolio turnover rate (excluding
short-term securities) 13% 11% 43% 32% 27% 11%
Value of preferred shares outstanding
(000's omitted) $ 20,000 $ 20,000 $ 20,000 $ 60,000 $ 60,000 --
Net asset coverage per share of preferred
shares, end of period $142,201 $ 140,086 $ 145,188 $ 129,283 $ 126,938 --
Liquidation value per share of preferred
shares (e) $ 50,000 $ 50,000 $ 50,000 $ 50,000 $ 50,000 --
</TABLE>
* Commencement of investment operations
**Initial period
See accompanying notes to financial highlights on page 25.
(7) FINANCIAL HIGHLIGHTS (CONTINUED)
<TABLE>
<CAPTION>
MINNESOTA MUNICIPAL III ARIZONA MUNICIPAL
PERIOD FROM PERIOD FROM
YEAR OCTOBER 29, YEAR YEAR FEBRUARY 26,
ENDED 1993* TO ENDED ENDED 1993* TO
MARCH 31, MARCH 31, MARCH 31, MARCH 31, MARCH 31,
1995 1994** 1995 1994 1993**
<S> <C> <C> <C> <C> <C>
Net asset value:
Beginning of period $ 11.86 $ 14.03 $ 12.70 $ 13.77 $ 13.95
Operations:
Investment income - net 1.06 0.32 1.08 0.95 0.01
Realized and unrealized gain (loss) on investments - net 0.28 (1.88) 0.56 (0.79) (0.13)
Total from operations 1.34 (1.56) 1.64 0.16 (0.12)
Distributions to:
Common shareholders from investment income - net (0.73) (0.25) (0.78) (0.75) --
Preferred shareholders from investment
income - net (0.28) (0.06) (0.28) (0.18) --
Common shareholders from realized capital
gains - net -- -- (0.05) (0.09) --
Preferred shareholders from realized capital
gains - net -- -- (0.01) (0.02) --
Total distributions (1.01) (0.31) (1.12) (1.04) --
Capital share transactions:
Capital charge /adjustment with respect to issuance of
shares 0.01 (0.30) -- (0.19) (0.06)
Net asset value:
End of period $ 12.20 $ 11.86 $ 13.22 $ 12.70 $ 13.77
Market value:
End of period $ 11.25 $ 14.00 $ 12.13 $ 13.88 $ 15.13
Total investment return:
Market value (a) (14.27)% 1.53% (6.43)% (2.91)% 8.42%
Net asset value (b) 9.55% (13.85)% 11.29% (2.20)% (1.29)%
Net assets applicable to outstanding capital shares
at end of period (000's omitted) $ 37,418 $ 36,785 $ 64,438 $ 62,881 $ 41,063
Ratios/Supplemental Data:
Ratio of expenses to average net assets (c) 0.82% 0.90%(d) 0.79% 0.82% 0.90%(d)
Ratio of investment income - net to
average net assets (c) 5.37% 3.95%(d) 5.19% 4.41% 1.29%(d)
Portfolio turnover rate (excluding
short-term securities) 47% 21% 18% 15% 0%
Value of preferred shares outstanding
(000's omitted) $ 15,000 $ 15,000 $ 25,000 $ 25,000 --
Net asset coverage per share of preferred
shares, end of period $ 124,728 $ 122,616 $ 128,877 $ 125,762 --
Liquidation value per share of preferred
shares (e) $ 50,000 $ 50,000 $ 50,000 $ 50,000 --
</TABLE>
* Commencement of investment operations
**Initial period
See accompanying notes to financial highlights on page 25.
(7) FINANCIAL HIGHLIGHTS (CONTINUED)
<TABLE>
<CAPTION>
COLORADO INSURED
FLORIDA INSURED MUNICIPAL MUNICIPAL
PERIOD FROM PERIOD FROM
YEAR YEAR FEBRUARY 26, YEAR JULY 29,
ENDED ENDED 1993* TO ENDED 1993* TO
MARCH 31, MARCH 31, MARCH 31, MARCH 31, MARCH 31,
1995 1994 1993** 1995 1994**
<S> <C> <C> <C> <C> <C>
Net asset value:
Beginning of period $ 12.46 $ 13.73 $ 14.05 $ 12.80 $ 14.10
Operations:
Investment income - net 1.07 0.96 0.01 1.02 0.59
Realized and unrealized gain (loss) on investments - net 0.69 (1.10) (0.25) 0.44 (1.19)
Total from operations 1.76 (0.14) (0.24) 1.46 (0.60)
Distributions to:
Common shareholders from investment income - net (0.77) (0.74) -- (0.76) (0.39)
Preferred shareholders from investment income - net (0.28) (0.19) -- (0.27) (0.11)
Common shareholders from realized capital gains - net -- -- -- (0.03) --
Preferred shareholders from realized capital gains - net -- -- -- (0.01) --
Total distributions (1.05) (0.93) -- (1.07) (0.50)
Capital share transactions:
Capital charge with respect to issuance of shares -- (0.20) (0.08) -- (0.20)
Net asset value:
End of period $ 13.17 $ 12.46 $ 13.73 $ 13.19 $ 12.80
Market value:
End of period $ 12.25 $ 12.50 $ 15.13 $ 12.25 $ 14.50
Total investment return:
Market value (a) 4.69% (13.04)% 7.65% (10.05)% 5.52%
Net asset value (b) 12.56% (4.40)% (2.28)% 9.67% (6.66)%
Net assets applicable to outstanding capital shares
at end of period (000's omitted) $51,891 $50,189 $33,247 $103,781 $101,923
Ratios/Supplemental Data:
Ratio of expenses to average net assets (c) 0.81% 0.85% 0.90%(d) 0.76% 0.78%(d)
Ratio of investment income - net to
average net assets (c) 5.21% 4.49% 1.24%(d) 4.88% 4.26%(d)
Portfolio turnover rate (excluding
short-term securities) 10% 20% 0% 7% 3%
Value of preferred shares outstanding (000's omitted) $20,000 $20,000 -- $40,000 $40,000
Net asset coverage per share of preferred
shares, end of period $129,728 $125,473 -- $129,727 $127,404
Liquidation value per share of preferred shares (e) $50,000 $50,000 -- $50,000 $50,000
</TABLE>
* Commencement of investment operations
**Initial period
See accompanying notes to financial highlights on page 25.
THE VOYAGEUR FUNDS
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
(7) FINANCIAL HIGHLIGHTS (CONTINUED)
Notes to Financial Highlights
(a) Total investment return is calculated assuming a purchase of common shares
at the current market value on the first day and a sale at the current
market value on the last day of each period reported. Underwriting
discounts and commissions are not reflected in the total investment return
for the initial period of each Fund. If underwriting discounts and
commissions had been reflected, total investment returns for the initial
period would have been 11.89%, 0.83%, (5.07)%, 0.83%, 0.83% and (0.81)% for
Minnesota Municipal, Minnesota Municipal II, Minnesota Municipal III,
Arizona Municipal, Florida Insured Municipal and Colorado Insured
Municipal, respectively. Dividends and distributions, if any, are assumed
for purposes of this calculation, to be reinvested at prices obtained under
the Funds' dividend reinvestment plans. Total investment returns for
periods of less than one year are not annualized.
(b) Total investment return is calculated assuming a purchase of common shares
at the current net asset value on the first day and a sale at the current
net asset value on the last day of each period reported. Dividends and
distributions, if any, are assumed for purposes of this calculation, to be
reinvested at net asset value as of dividend payable date. Total investment
returns for periods of less than one year are not annualized. These
percentages are not an indication of the performance of a shareholder's
investment in the Fund based on market value due to differences between the
market price of the stock and the net asset value of the Fund.
(c) Ratios calculated on the basis of net assets applicable to both the common
and preferred shares relative to the average net assets of common and
preferred shareholders. Ratios do not reflect the effect of dividend
payments to preferred shareholders.
(d) Annualized.
(e) Excluding any accumulated but unpaid dividends.
THE VOYAGEUR FUNDS
QUARTERLY DATA (UNAUDITED)
<TABLE>
<CAPTION>
NET CHANGE
NET IN NET ASSETS
INVESTMENT INVESTMENT GAIN (LOSS) ON RESULTING FROM MARKET PRICE
INCOME INCOME - NET INVESTMENTS OPERATIONS ON ASE
TOTAL PER TOTAL PER TOTAL PER TOTAL PER
QUARTER ENDED (000) SHARE (000) SHARE (000) SHARE (000) SHARE HIGH LOW
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
VOYAGEUR MINNESOTA MUNICIPAL INCOME FUND, INC.
March 31, 1995............... $897 $0.35 $803 $0.31 $3,227 $1.25 $4,030 $1.56 $14.625 $13.000
December 31, 1994............ 910 0.35 789 0.30 (1,526) (0.59) (737) (0.29) 13.875 12.125
September 30, 1994........... 906 0.35 778 0.30 (637) (0.25) 141 0.05 14.875 12.875
June 30, 1994................ 891 0.34 765 0.30 (181) (0.07) 584 0.23 15.500 14.125
Totals....................$3,604 $1.39 $3,135 $1.21 $883 $0.34 $4,018 $1.55
VOYAGEUR MINNESOTA MUNICIPAL INCOME FUND II, INC.
March 31, 1995...............$2,304 $0.32 $2,093 $0.29 $10,765 $1.48 $12,858 $1.77 $12.750 $10.750
December 31, 1994............ 2,332 0.32 2,032 0.28 (4,678) (0.64) (2,646) (0.36) 11.625 9.750
September 30, 1994........... 2,305 0.32 1,987 0.27 (2,119) (0.29) (132) (0.02) 13.375 10.250
June 30, 1994................ 2,270 0.31 1,953 0.27 (1,175) (0.16) 778 0.11 14.375 12.750
Totals....................$9,211 $1.27 $8,065 $1.11 $ 2,793 $ 0.39 $10,858 $1.50
VOYAGEUR MINNESOTA MUNICIPAL INCOME FUND III, INC.
March 31, 1995............... $557 $0.30 $504 $0.28 $2,432 $1.32 $2,936 $1.60 $11.625 $9.875
December 31, 1994............ 570 0.31 491 0.27 (989) (0.54) (498) (0.27) 10.625 8.625
September 30, 1994........... 562 0.31 480 0.26 (585) (0.32) (105) (0.06) 12.250 10.375
June 30, 1994................ 547 0.30 464 0.25 (351) (0.19) 113 0.06 13.750 11.500
Totals....................$2,236 $1.22 $1,939 $1.06 $ 507 $ 0.27 $2,446 $1.33
VOYAGEUR ARIZONA MUNICIPAL INCOME FUND, INC.
March 31, 1995............... $920 $0.31 $850 $0.28 $4,736 $1.59 $5,586 $1.87 $12.375 $10.750
December 31, 1994............ 932 0.31 797 0.27 (1,735) (0.58) (938) (0.31) 11.875 10.000
September 30, 1994........... 925 0.31 782 0.26 (807) (0.27) (25) (0.01) 13.000 11.625
June 30, 1994................ 928 0.31 787 0.27 (503) (0.18) 284 0.09 13.875 11.875
Totals....................$3,705 $1.24 $3,216 $1.08 $1,691 $ 0.56 $4,907 $1.64
VOYAGEUR FLORIDA INSURED MUNICIPAL INCOME FUND
March 31, 1995............... $742 $0.30 $675 $0.28 $3,729 $1.54 $4,404 $1.82 $12.500 $10.375
December 31, 1994............ 755 0.31 647 0.27 (887) (0.37) (240) (0.10) 11.500 9.875
September 30, 1994........... 750 0.31 637 0.26 (1,035) (0.43) (398) (0.17) 12.625 11.125
June 30, 1994................ 743 0.31 629 0.26 (128) (0.05) 501 0.21 13.000 11.750
Totals....................$2,990 $1.23 $2,588 $1.07 $1,679 $0.69 $4,267 $1.76
VOYAGEUR COLORADO INSURED MUNICIPAL INCOME FUND, INC.
March 31, 1995...............$1,403 $0.29 $1,241 $0.26 $6,076 $1.26 $7,317 $1.52 $12.375 $10.875
December 31, 1994............ 1,434 0.30 1,239 0.26 (2,325) (0.48) (1,086) (0.22) 12.375 10.125
September 30, 1994........... 1,431 0.30 1,226 0.25 (1,218) (0.25) 8 0.00 13.000 11.875
June 30, 1994................ 1,415 0.29 1,209 0.25 (419) (0.09) 790 0.16 14.500 12.875
Totals....................$5,683 $1.18 $4,915 $1.02 $2,114 $ 0.44 $7,029 $1.46
</TABLE>
<TABLE>
<CAPTION>
VOYAGEUR MINNESOTA MUNICIPAL INCOME FUND, INC.
INVESTMENTS IN SECURITIES MARCH 31, 1995
PRINCIPAL
AMOUNT COUPON MARKET
($000) NAME OF ISSUER (b) RATE MATURITY VALUE (a)
(PERCENTAGE OF EACH INVESTMENT CATEGORY RELATES TO TOTAL NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS.)
MINNESOTA MUNICIPAL BONDS (152.0%):
EDUCATION REVENUE (14.0%):
<S> <C> <C> <C> <C>
$1,000 Minnesota Higher Education Facilities Authority Revenue, Series 3-J,
Macalester College................................................. 6.40% 03-01-22 $1,015,240
1,000 Minnesota Higher Education Facilities Authority Revenue, Series 3-C,
St. Thomas University ............................................. 6.25 09-01-16 1,006,470
250 Minnesota State University Board Revenue, Series A, State
University System 6.05 06-30-18 245,685
1,075 Northfield, Minnesota, St. Olaf College Revenue........................ 6.30 10-01-12 1,105,143
1,750 Northfield, Minnesota, St. Olaf College Revenue........................ 6.40 10-01-21 1,784,247
5,156,785
GENERAL OBLIGATION (25.4%):
1,000 Carver County, Series 1992-A........................................... 5.88 02-01-14 979,290
1,000 Dakota County (AMBAC Insured).......................................... 6.45 02-01-09 1,040,160
305 Edina Recreational Facilities Bonds, Series 1992-A..................... 6.00 01-01-09 310,890
320 Edina Recreational Facilities Bonds, Series 1992-A..................... 6.00 01-01-10 324,746
2,200 Hennepin County........................................................ 5.75 10-01-10 2,215,994
1,600 Minneapolis............................................................ 6.00 03-01-16 1,612,048
1,500 Minneapolis-St Paul Metro Airport Commission, AMT...................... 6.60(e) 01-01-11 1,566,060
1,250 St. Francis, Independent School District #15 (CGIC Insured)............ 6.30 02-01-11 1,316,075
9,365,263
HEALTH CARE REVENUE (27.8%):
1,000 Bloomington Health Care Facilities, Masonic Home Care Center
(AMBAC Insured)...................................................... 5.88 07-01-22 965,030
2,000 Duluth Economic Development Authority, Health Care Facility Revenue,
Series 1992, Duluth Clinic (AMBAC Insured)........................ 6.30 11-01-22 2,028,540
1,000 Duluth Economic Development Authority, Hospital Facilities Revenue,
Series 1992-B, St. Luke's Hospital (Connie Lee Insured)............ 6.40 05-01-18 1,021,300
1,000 Duluth Economic Development Authority, Health Care Facilities Revenue,
Series 1993-C, St. Mary's Hospital (Connie Lee Insured)............ 6.00 02-15-20 990,980
2,210 Minneapolis Hospital System Revenue, Fairview Hospital, Series 1991-A
(MBIA Insured)..................................................... 6.50 01-01-11 2,306,997
1,500 Minneapolis Hospital System Revenue, Fairview Hospital, Series 1993-A
(MBIA Insured)..................................................... 5.25 11-15-19 1,345,485
500 Minneapolis-St. Paul, HRA Health One (MBIA Insured).................... 6.75 08-15-14 528,420
1,000 St. Cloud Hospital Revenue (AMBAC Insured)............................. 6.75 07-01-15 1,054,770
10,241,522
HOUSING REVENUE (34.4%):
980 Minnesota State HFA, Multi-Family Mortgage Revenue, Series B........... 6.90 02-01-04 999,120
1,430 Minnesota State HFA, Single Family Mortgage Revenue, Series 1991-A,
AMT (FHA Insured)................................................. 7.45(e) 07-01-22 1,510,566
635 Minnesota State HFA, Single Family Mortgage Revenue, Series 1992-G..... 6.50% 07-01-06 651,218
2,725 Minnetonka, Minnesota Senior Housing Project (Guaranteed by Presbyterian
Homes of Minnesota)............................................... 7.70 06-01-25 2,752,958
1,400 New Brighton, Multi-Family Mortgage Revenue, Polynesian Village
Apartments, Series 1995-A, AMT................................... 7.60(e) 04-01-25 1,398,348
2,265 St. Anthony Multi-Family Housing Development (Asset Guaranty Insured).. 6.88 07-01-22 2,359,768
2,950 St. Paul HRA, Multi-Family Housing Revenue, Pointe of St. Paul Project,
Series 1992 (FNMA Backed) ........................................ 6.60 10-01-12 3,029,502
12,701,480
INDUSTRIAL REVENUE (9.5%):
2,575 Bass Brook, PCR, Minnesota Power and Light............................. 6.00 07-01-22 2,477,897
1,000 Metropolitan Council Sports Facilities Commission,
Hubert H. Humphrey Metrodome...................................... 6.00 10-01-09 1,013,710
3,491,607
POLLUTION CONTROL REVENUE (4.3%):
1,500 Minnesota Public Facilities Authority, Water Pollution
Control Revenue, Series 1992...................................... 6.50 03-01-14 1,573,260
PRE-REFUNDED/ESCROWED (14.6%):
3,055 Dakota & Washington Counties, HRA, Single Family Mortgage Revenue,
Bloomington, GNMA Backed, AMT...................................... 8.38(e) 09-01-21 4,005,349
1,250 Minneapolis Hospital Revenue, Abbott-Northwestern Hospital............. 7.00 12-01-05 1,377,050
5,382,399
UTILITY REVENUE (22.0%):
1,000 Anoka County Solid Waste Disposal, National Rural Co-op Utility, AMT... 6.95(e) 12-01-08 1,051,300
1,500 Northern Minnesota Municipal Power Agency, Electric System, Series A... 5.00 01-01-21 1,271,490
1,250 Northern Minnesota Municipal Power Agency, Electric System,
Series B (AMBAC)................................................... 5.50 01-01-18 1,184,700
580 Southern Minnesota Municipal Power Agency, Series A.................... 5.00 01-01-16 503,568
1,000 Southern Minnesota Municipal Power Agency, Series B.................... 5.75 01-01-11 995,800
1,000 Southern Minnesota Municipal Power Agency, Series B (AMBAC Insured).... 5.50 01-01-15 951,843
2,275 Western Minnesota Municipal Power Agency (MBIA Insured)................ 5.50 01-01-15 2,169,440
8,128,141
TOTAL MUNICIPAL BONDS (cost: $54,954,564) 56,040,457
SHORT-TERM SECURITIES (3.9%):
1,456 Federated Minnesota Municipal Cash Trust............................... 4.03(c) 1,456,000
TOTAL SHORT-TERM SECURITIES (cost: $1,456,000) 1,456,000
TOTAL INVESTMENTS IN SECURITIES (cost: $56,410,564) (d) $57,496,457
</TABLE>
See accompanying notes to investments in securities on page 40.
<TABLE>
<CAPTION>
VOYAGEUR MINNESOTA MUNICIPAL INCOME FUND II, INC.
INVESTMENTS IN SECURITIES MARCH 31, 1995
PRINCIPAL
AMOUNT COUPON MARKET
($000) NAME OF ISSUER (b) RATE MATURITY VALUE (a)
(PERCENTAGE OF EACH INVESTMENT CATEGORY RELATES TO TOTAL NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS.)
MINNESOTA MUNICIPAL BONDS (160.9%):
EDUCATION REVENUE (14.3%):
<S> <C> <C> <C> <C>
$1,330 Minnesota Higher Education Facilities Authority Revenue, Series R1,
St. Thomas University.............................................. 5.45% 10-01-07 $1,293,611
1,105 Minnesota Higher Education Facilities Authority Revenue, Series R1,
St. Thomas University.............................................. 5.50 10-01-08 1,070,237
1,635 Minnesota Higher Education Facilities Authority Revenue, Series R2,
St. Thomas University.............................................. 5.60 09-01-14 1,540,824
1,050 Minnesota Higher Education Facilities Authority Revenue, Series R1,
St. Thomas University.............................................. 5.60 10-01-15 977,435
1,250 Minnesota State University Board Revenue, Series 1993-A,
State University System............................................ 6.10 06-30-23 1,234,925
4,115 Minnesota State University Board Revenue, Series 1993-C,
State University System (MBIA Insured)............................. 5.60 06-30-16 3,956,531
3,720 Minnesota State University Board Revenue, Series 1993-C,
State University System (MBIA Insured)............................. 5.60 06-30-19 3,571,944
13,645,507
GENERAL OBLIGATION (32.9%):
3,700 Becker, Minnesota AMT (MBIA Insured)................................... 6.25 (e) 08-01-15 3,802,231
4,030 Buffalo Independent School District (CGIC Insured)..................... 6.15 02-02-22 4,081,947
1,305 Centennial, Minnesota, Independent School District #12 (FGIC Insured).. 4.88 02-01-12 1,162,076
2,000 Hennepin County ....................................................... 5.75 10-01-10 2,014,540
3,225 Melrose Independent School District #740, Series A (FSA Insured)...... 5.63 02-01-13 3,141,537
1,825 Metropolitan Council................................................... 5.13 12-01-08 1,747,857
775 Metropolitan Council................................................... 5.13 12-01-09 734,731
500 Metropolitan Council................................................... 5.13 12-01-10 468,460
3,400 Minneapolis Convention Center Facilities............................... 5.40 04-01-12 3,222,554
2,000 Minneapolis Convention Center Facilities............................... 5.45 04-01-14 1,887,080
1,000 Minnesota State........................................................ 5.38 08-01-11 959,510
2,140 Red Wing Independent School District #256, Series 1993-A.............. 5.60 02-01-10 2,099,682
2,925 Red Wing Independent School District #256, Series 1993-A.............. 5.70 02-01-12 2,878,142
3,125 Red Wing Independent School District #256, Series 1993-A.............. 5.70 02-01-13 3,059,688
31,260,035
HEALTH CARE REVENUE (31.4%):
4,000 Bloomington Health Care Facility, Masonic Home Care Center
(AMBAC Insured).................................................... 5.88 07-01-22 3,860,120
1,195 Brainerd Healthcare Facilities, Lutheran Hospital
Series A (CGIC Insured)............................................ 6.65 03-01-17 1,251,308
1,250 Detroit Lakes Benedictine Health Systems (Connie Lee Insured).......... 6.00 02-15-19 1,242,038
1,000 Duluth Economic Development Authority, Hospital Facilities Revenue,
Duluth Clinic (AMBAC Insured)...................................... 6.20 11-01-12 1,020,910
$5,190 Duluth Economic Development Authority, Hospital Facilities Revenue,
Series 1992, Duluth Clinic (AMBAC Insured) ........................ 6.30% 11-01-22 $5,264,061
6,000 Duluth Economic Development Authority, Hospital Facilities Revenue,
Series 1993-C, St. Mary's Hospital (Connie Lee Insured)............ 6.00 02-15-20 5,945,880
2,105 Minneapolis, Housing and Development Authority, Health One............. 7.40 08-15-11 2,321,141
7,230 Robbinsdale North Memorial Medical Center, Series 1993-B
(AMBAC Insured).................................................... 5.50 05-15-23 6,658,613
1,000 Rochester Health Care Facilities, Mayo Clinic Foundation,
Mayo Medical Center, Series 1992-I................................. 5.75 11-15-21 955,370
1,500 St. Paul HRA, Ramsey Medical Center, Series 1993 (AMBAC Insured)....... 5.55 05-15-23 1,380,165
29,899,606
HOUSING REVENUE (32.8%):
1,880 Dakota County HRA, Multi-Family Mortgage Revenue,
Imperial Ridge Project, Series 1993-A (GNMA Backed)................ 6.10 12-15-28 1,779,928
1,300 Minneapolis, Minnesota, Multi-Family Housing Revenue,
Olson Townhomes, Section 8, AMT.................................... 6.00(e) 12-01-19 1,209,962
1,115 Minnesota HFA, Multi-Family Rental Housing, Series-D................... 5.90 02-01-14 1,081,628
2,295 Minnesota HFA, Multi-Family Rental Housing, Series-D................... 6.00 08-01-22 2,202,626
1,715 Minnesota HFA, Single Family Mortgage Revenue, AMT..................... 7.05(e) 07-01-22 1,772,521
4,320 Minnesota HFA, Single Family Mortgage Revenue, Series 1992-B2, AMT..... 6.15(e) 01-01-26 4,158,216
4,370 Minnesota HFA, Single Family Mortgage Revenue, Series 1992-C2, AMT..... 6.15(e) 07-01-23 4,210,932
3,920 Minnesota HFA, Single Family Mortgage Revenue, Series 1994-J, AMT...... 6.95(e) 07-01-26 4,066,608
1,225 Minnetonka, Minnesota Senior Housing Project (Guaranteed by
Presbyterian Homes of Minnesota).................................. 7.25 06-01-09 1,256,875
760 Minnetonka, Minnesota Senior Housing Project (Guaranteed by
Presbyterian Homes of Minnesota).................................. 7.50 06-01-14 777,168
2,565 Minnetonka, Minnesota Senior Housing Project (Guaranteed by
Presbyterian Homes of Minnesota).................................. 7.55 06-01-19 2,593,472
4,120 New Brighton, Multi-Family Mortgage Revenue, Polynesian Village
Apartments, Series 1995-A, AMT.................................... 7.60(e)(f)04-01-25 4,115,138
2,000 St. Paul HRA (FNMA Insured)............................................ 6.40 03-01-21 2,003,980
31,229,054
INDUSTRIAL REVENUE (16.6%):
7,660 Bass Brook, PCR, Minnesota Power and Light............................. 6.00 07-01-22 7,371,141
5,020 Metropolitan Council Sports Facilities Commission,
Hubert H. Humphrey Metrodome....................................... 6.00 10-01-09 5,088,824
1,000 Minnesota Public Facilities Authority, Water Pollution Control Bonds... 6.25 03-01-16 1,015,430
1,500 St. Paul HRA Civic Center, Series 1993................................. 5.45 11-01-13 1,381,455
1,000 St. Paul HRA , Sales Tax Revenue, Civic Center......................... 5.55 11-01-23 910,910
15,767,760
POLLUTION CONTROL REVENUE (3.6%):
$3,300 Minnesota Public Facilities Authority, Water Pollution Control Revenue,
Series 1992........................................................ 6.50% 03-01-14 3,461,172
PRE-REFUNDED/ESCROWED (17.4%):
9,000 Dakota & Washington Counties, HRA, Single Family Mortgage Revenue,
Bloomington, GNMA Backed, AMT...................................... 8.38(e) 09-01-21 11,799,720
1,000 University of Minnesota Hospital....................................... 6.75 12-01-16 1,133,650
3,715 Southern Minnesota, Municipal Power Agency Power Supply................ 5.75 01-01-18 3,604,627
16,537,997
UTILITY REVENUE (11.9%):
7,205 Northern Minnesota Municipal Power Agency, Electric System,
Series B (AMBAC Insured)........................................... 5.50 01-01-18 6,828,611
4,665 Southern Minnesota Municipal Power Agency.............................. 5.75 01-01-18 4,448,451
11,277,062
TOTAL MUNICIPAL BONDS (cost: $155,639,762) 53,078,193
SHORT-TERM SECURITIES: (4.4%)
4,192 Federated Minnesota Municipal Cash Trust ............................. 4.03(c) 4,192,000
TOTAL SHORT-TERM SECURITIES (cost: $4,192,000) 4,192,000
TOTAL INVESTMENT IN SECURITIES (cost: $159,831,762)(d) $157,270,193
</TABLE>
See accompanying ntoes to investments on page 40.
<TABLE>
<CAPTION>
VOYAGEUR MINNESOTA MUNICIPAL INCOME FUND III, INC.
INVESTMENTS IN SECURITIES MARCH 31, 1995
PRINCIPAL
AMOUNT COUPON MARKET
($000) NAME OF ISSUER (b) RATE MATURITY VALUE (a)
(PERCENTAGE OF EACH INVESTMENT CATEGORY RELATES TO TOTAL NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS.)
MINNESOTA MUNICIPAL BONDS (164.7%):
EDUCATION REVENUE (14.5%):
<S> <C> <C> <C> <C>
$1,000 Minnesota Higher Education Facilities Authority Revenue, Series R1,
St. Thomas University.............................................. 5.60% 10-01-15 $ 930,890
1,250 Minnesota State University Board Revenue, Series 1993-C,
State University System (MBIA Insured)............................. 5.50 06-30-12 1,209,325
1,075 Northfield, Minnesota, St. Olaf College Revenue........................ 6.30 10-01-12 1,105,143
3,245,358
GENERAL OBLIGATION (27.3%):
1,350 Anoka-Hennepin Independent School District #11, Series C (FGIC Insured) 5.00 02-01-10 1,232,118
2,000 Minneapolis, Series B.................................................. 5.20 03-01-13 1,835,960
2,000 Minnesota State........................................................ 4.90 08-01-11 1,799,740
1,300 Waconia, Independent School District #110, Series 1993-A (CGIC Insured) 5.45 02-01-15 1,240,785
6,108,603
HEALTH CARE REVENUE (24.3%):
1,500 Duluth, Minnesota, Economic Development Authority, Duluth Clinic
(AMBAC Insured).................................................... 6.20 11-01-12 1,531,365
2,000 Princeton, Minnesota, Fairview Hospital Revenue, 1991-C (MBIA Insured). 6.25 01-01-21 2,022,560
1,000 St. Louis Park, Health Care Facilities Revenue, Series A (AMBAC Insured) 5.20 07-01-23 885,480
1,000 Wadena County, Health Care Facilities Revenue.......................... 7.75 09-01-24 1,014,270
5,453,675
HOUSING REVENUE (36.4%):
$2,000 Burnsville, Minnesota, Multi-Family Mortgage Revenue,
Series A (FSA Insured)............................................. 7.10 01-01-30 2,052,600
1,000 Edina, Minnesota, HRA, Edina Park...................................... 7.70 12-01-28 1,049,640
1,000 Minneapolis, Minnesota, Findley Place Series 1994, AMT................. 7.00(e) 12-01-16 1,034,530
1,675 Minneapolis, Minnesota, Multi-Family Housing Revenue,
Olson Townhomes, AMT............................................... 6.00(e) 12-01-19 1,558,990
1,585 Minnesota State HFA, Single Family Mortgage Revenue, Series 1991-A, AMT 7.45(e) 07-01-22 1,674,299
750 Minnesota State HFA, Singe Family Mortgage Revenue, Series C, AMT...... 9.00(e) 08-01-18 798,090
8,168,149
INDUSTRIAL REVENUE (24.3%):
3,275 Bass Brook, PCR, Minnesota Power and Light............................. 6.00 07-01-22 3,151,500
1,000 St. Paul HRA, Civic Center, Series 1993................................ 5.45 11-01-13 920,970
1,500 St. Paul HRA, Civic Center, Sales Tax Revenue.......................... 5.55 11-01-23 1,366,365
5,438,835
PRE-REFUNDED/ESCROW (15.3%):
1,580 University of Minnesota Hospital....................................... 6.75 12-01-16 1,791,167
1,510 Western Minnesota Municipal Power...................................... 6.63 01-01-16 1,647,470
3,438,637
UTILITY REVENUE (22.6%):
1,500 Moorhead Minnesota Public Utilities Revenue,
(MBIA Insured)..................................................... 6.25 11-01-12 1,541,775
1,900 Northern Minnesota Municipal Power Agency, Electric System, Series B
(AMBAC Insured) ................................................... 5.50 01-01-18 1,800,744
1,800 Southern Minnesota Municipal Power Agency, Series B.................... 5.75 01-01-18 1,716,444
5,058,963
TOTAL INVESTMENTS IN SECURITIES (cost: $37,888,127) (d) $36,912,220
</TABLE>
See accompanying notes to investments in securities on page 40.
<TABLE>
<CAPTION>
VOYAGEUR ARIZONA MUNICIPAL INCOME FUND, INC.
INVESTMENTS IN SECURITIES MARCH 31, 1995
PRINCIPAL
AMOUNT COUPON MARKET
($000) NAME OF ISSUER (b) RATE MATURITY VALUE (a)
(PERCENTAGE OF EACH INVESTMENT CATEGORY RELATES TO TOTAL NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS.)
ARIZONA MUNICIPAL BONDS (160.0%):
EDUCATION REVENUE (18.3%):
<S> <C> <C> <C> <C>
$3,000 Arizona State University, Series A..................................... 5.50% 07-01-19 $2,809,290
1,800 Maricopa County, Alhambra Elementary School District #68 (AMBAC Insured) 5.63 07-01-13 1,733,256
600 Santa Cruz Valley, Unified School District #35 (AMBAC Insured)......... 5.80 07-01-09 600,390
1,000 University of Arizona.................................................. 6.25 06-01-11 1,037,290
1,000 University of Arizona.................................................. 6.35 06-01-14 1,028,900
7,209,126
GENERAL OBLIGATION (26.7%):
2,000 Maricopa County Unified School District #48............................ 5.00 07-01-10 1,809,200
1,175 Maricopa County Unified School District #80 (FGIC Insured)............. 6.40 07-01-10 1,227,757
1,800 Mesa General Obligation Project of 1987 (MBIA Insured)................. 5.70 07-01-08 1,805,742
1,250 Pima County/Tucson Unified School District #1, Series D (FGIC Insured). 6.10 07-01-12 1,271,938
2,000 Pima County Unified School District #6 (FGIC Insured).................. 5.75 07-01-12 1,972,900
1,000 Scottsdale, Arizona, Series C.......................................... 5.25 07-01-12 930,140
1,500 Tempe, Arizona, Series B............................................... 6.00 07-01-12 1,508,550
10,526,227
HEALTH CARE REVENUE (28.2%):
1,175 Arizona Hospital System Revenue, Samaritan Health System (MBIA Insured) 5.63 12-01-15 1,135,226
1,500 Arizona Hospital Health Facilities Authority........................... 6.25 09-01-11 1,545,360
1,750 Maricopa County Health Facilities, Catholic Healthcare West,
Series A (MBIA Insured)............................................ 5.75 07-01-11 1,742,510
1,400 Maricopa County Health Facilities, Catholic Healthcare West,
Series A (MBIA Insured)............................................ 6.00 07-01-21 1,390,690
2,750 Scottsdale Industrial Development Authority, Scottsdale Memorial
Hospital (AMBAC Insured)............................................ 5.25 09-01-18 2,498,595
1,360 University of Arizona Medical Center (MBIA Insured).................... 5.00 07-01-13 1,217,200
700 University of Arizona Medical Center (MBA Insured)..................... 6.25 07-01-16 716,191
1,000 University of Arizona Medical Center (MBIA Insured).................... 5.00 07-01-21 866,170
11,111,942
HOUSING REVENUE (12.6%):
1,730 Peoria Multi-Family Housing Mortgage Revenue (GNMA Insured)............ 7.30 02-20-28 1,841,049
625 Phoenix Industrial Development Authority, Multi-Family
Mortgage Revenue (FHA Insured)...................................... 6.80 11-01-25 641,300
2,505 Tempe Industrial Development Authority, Multi-Family
Mortgage Revenue (FHA Insured)...................................... 6.13 06-01-10 2,501,067
4,983,416
INDUSTRIAL REVENUE (9.0%):
1,000 Arizona State Transportation Board..................................... 5.25 07-01-09 948,920
1,750 Maricopa County Stadium District (MBIA Insured)........................ 5.50 07-01-13 1,679,755
1,000 Navajo County Pollution Control Corporation (AMBAC Insured)............ 5.50 08-15-28 921,450
3,550,125
LEASE REVENUE (6.5%):
$2,500 Scottsdale Municipal Property Corp. (FGIC Insured)..................... 6.25% 11-01-14 $2,555,775
SALES TAX REVENUE (3.4%):
1,300 City of Phoenix, Junior Lien Street & Highway (FGIC Insured)........... 6.25 07-01-11 1,341,275
TRANSPORTATION REVENUE (12.3%):
2,000 Tucson Airport Authority Revenue Funding (MBIA Insured)................ 5.70 06-01-13 1,953,380
3,000 Tucson, Arizona, Street & Highway User Revenue (MBIA Insured).......... 5.50 07-01-12 2,911,890
4,865,270
UTILITY REVENUE (43.0%):
1,750 Central Arizona Water Conservation District, Series A.................. 5.50 11-01-10 1,712,287
1,050 Chandler, Arizona, Water & Sewer (FGIC Insured)........................ 5.00 07-01-08 994,340
1,150 Chandler, Arizona, Water & Sewer (FGIC Insured)........................ 5.00 07-01-09 1,078,459
1,000 Phoenix Civic Improvement Corp......................................... 5.00 07-01-18 863,050
2,800 Phoenix Civic Improvement Corp......................................... 5.50 07-01-21 2,629,844
2,000 Phoenix Water System Revenue........................................... 5.50 07-01-22 1,863,880
2,000 Salt River Project, Electric System Revenue............................ 5.75 01-01-19 1,919,800
2,000 Salt River Project, Electric System Revenue............................ 6.25 01-01-27 2,026,600
4,000 Tucson Water Revenue Refunding, Series A (FGIC Insured)................ 5.75 07-01-18 3,884,760
16,973,020
TOTAL INVESTMENTS IN SECURITIES (cost: $63,817,219) (d) $63,116,176
</TABLE>
See accompanying notes to investments in securities on page 40.
<TABLE>
<CAPTION>
VOYAGEUR FLORIDA INSURED MUNICIPAL INCOME FUND
INVESTMENTS IN SECURITIES MARCH 31, 1995
PRINCIPAL
AMOUNT COUPON MARKET
($000) NAME OF ISSUER (b) RATE MATURITY VALUE (a)
(PERCENTAGE OF EACH INVESTMENT CATEGORY RELATES TO TOTAL NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS.)
FLORIDA MUNICIPAL BONDS (160.4%):
GENERAL OBLIGATION (12.2%):
<S> <C> <C> <C> <C>
$1,000 Dade County Seaport (AMBAC Insured).................................... 6.25% 10-01-21 $1,014,450
2,000 Indian River County School District (FSA Insured)...................... 5.50 04-01-13 1,924,840
1,000 Miami (FGIC Insured)................................................... 5.50 12-01-13 959,360
3,898,650
HEALTH CARE REVENUE (29.5%):
1,500 Cape Canaveral Hospital District (AMBAC Insured)....................... 5.25 01-01-13 1,385,700
1,000 Dade County Health Facilities Authority, Baptist Hospital Miami
(MBIA Insured)..................................................... 5.25 05-15-21 895,550
1,000 Hillsborough County Industry Development Authority, Alleghany Health
System (MBIA Insured).............................................. 5.75 12-01-21 957,870
2,500 Lakeland Hospital System Revenue, Lakeland Regional Medical Center
(FGIC Insured)..................................................... 5.75 11-15-15 2,412,075
2,500 Palm Beach County Health Facilities Authority Revenue
(FSA Insured)...................................................... 5.75 12-01-14 2,425,350
1,500 Palm Beach County Health Facilities Authority Revenue, Jupiter Medical
Center Project (FSA Insured)....................................... 5.25 08-01-18 1,347,420
9,423,965
INDUSTRIAL REVENUE (6.7%):
2,250 Lee County Capital & Transportation Facilities (MBIA Insured).......... 5.60 10-01-21 2,136,982
MISCELLANEOUS & SALES TAX REVENUE (39.4%):
1,500 Boca Raton Community Redevelopment Tax Increment, Minzer Park Project
(FGIC Insured)..................................................... 5.88 03-01-13 1,494,150
1,000 Dade County Professional Sports Franchise Facilities, Series B
(FGIC Insured)..................................................... 6.00 10-01-22 993,330
1,500 Florida State Division Finance Department, Preservation Series 2000-A
(FSA Insured)...................................................... 5.50 07-01-10 1,477,050
1,500 Florida State Department of General Services, Florida Facilities Pool
(AMBAC Insured).................................................... 5.40 09-01-14 1,405,650
1,250 Hernando County Capital Improvements Revenue (MBIA Insured)............ 5.75 02-01-21 1,204,338
1,060 Orange County Sales Tax Revenue (FGIC Insured)......................... 6.13 01-01-19 1,061,897
3,000 Orange County Public Service Tax Revenue (FGIC Insured)................ 6.00 10-01-24 2,979,450
1,000 State of Florida Board of Regents, University System Improvements
(AMBAC Insured).................................................... 5.38 07-01-13 940,630
1,000 Tampa, Florida, Utilities Tax (AMBAC Insured).......................... 6.00 10-01-15 1,000,520
12,557,015
PRE-REFUNDED/ESCROWED (1.5%):
$440 Orange County Sales Tax Revenue (FGIC Insured)......................... 6.13% 01-01-19 $ 468,772
TRANSPORTATION REVENUE (13.6%):
1,500 Florida State Turnpike Authority, Series A (FGIC Insured).............. 5.50 07-01-10 1,477,050
1,000 Florida State Turnpike Authority, Series A (FGIC Insured).............. 5.25 07-01-11 953,650
2,000 Hillsborough County Aviation Authority, Tampa International Airport,
Series B (FGIC Insured)............................................ 5.60 10-01-19 1,905,360
4,336,060
UTILITY REVENUE (57.5%):
2,500 Charlotte County Utilities (FGIC Insured).............................. 5.50 10-01-17 2,376,300
2,000 City of Panama, City Beach Water & Sewer (AMBAC Insured)............... 5.50 06-01-18 1,892,220
1,500 City of Port Orange, Water & Sewer (AMBAC Insured)..................... 5.25 10-01-21 1,349,790
2,200 Florida Keys, Aqueduct Water Revenue (AMBAC Insured)................... 5.25 09-01-21 1,979,868
1,200 Florida State, Municipal Power Agency, St. Lucie Project (FGIC Insured) 5.70 10-01-16 1,170,960
1,000 Kissimmee Utility Authority, Electrical Systems Improvement
(FGIC Insured)..................................................... 5.50 10-01-15 957,350
1,000 Lakeland Waste Water Improvement Revenue (MBIA Insured)................ 5.50 10-01-16 949,290
1,500 Pembroke Pines Construction Utilities (FGIC Insured)................... 6.25 09-01-17 1,528,365
1,500 Sarasota County Utility System (FGIC Insured).......................... 5.50 10-01-22 1,399,575
1,500 Seacoast Utilities Authority, Water & Sewer (FGIC Insured)............. 5.50 03-01-13 1,437,285
2,000 Seacoast Utilities Authority, Water & Sewer (FGIC Insured)............. 5.50 03-01-16 1,913,720
1,500 South Florida Water Management District (AMBAC Insured)................ 5.25 10-01-15 1,376,550
18,331,273
TOTAL INVESTMENTS IN SECURITIES (cost: $52,287,913) (d) $51,152,717
</TABLE>
See accompanying notes to investments in securities on page 40.
<TABLE>
<CAPTION>
VOYAGEUR COLORADO INSURED MUNICIPAL INCOME FUND, INC.
INVESTMENTS IN SECURITIES MARCH 31, 1995
PRINCIPAL
AMOUNT COUPON MARKET
($000) NAME OF ISSUER (b) RATE MATURITY VALUE (a)
(PERCENTAGE OF EACH INVESTMENT CATEGORY RELATES TO TOTAL NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS.)
COLORADO MUNICIPAL BONDS (158.9%):
EDUCATION REVENUE (32.8%):
<S> <C> <C> <C> <C>
$2,190 Adams County School District #12, Thornton (FGIC Insured).............. 6.20% 12-15-10 $2,262,554
1,490 Auraria Higher Education Center Revenue Refunding
Parking Facilities (FSA Insured)................................... 5.30 04-01-12 1,407,067
1,115 Auraria Higher Education Center Revenue, Student Fee,
Series A (AMBAC Insured)........................................... 6.60 11-01-10 1,180,830
1,000 Auraria Higher Education Center Revenue, Student Fee,
Series B (AMBAC Insured)........................................... 6.50 11-01-16 1,042,420
5,000 Colorado Postsecondary Education Facility Authority Revenue,
University of Denver Project (Connie Lee Insured).................. 6.00 03-01-16 4,964,350
2,500 Colorado State Board of Agriculture Revenue Refunding,
Colorado State University, Auxiliary Facilities (MBIA Insured)..... 6.40 03-01-11 2,609,825
1,250 Colorado State Board of Agriculture Revenue Refunding &
Improvement, Fort Lewis College (FGIC Insured)..................... 6.50 10-01-12 1,306,450
5,000 Larimer County School District #R1, Poudre Improvement (MBIA Insured).. 6.15 12-15-16 5,109,300
1,000 University of Colorado, University Revenue, Research Building
Revolving Fund (MBIA Insured)...................................... 6.13 06-01-12 1,021,450
20,904,246
GENERAL OBLIGATION (22.5%):
3,000 Boulder Larimer & Weld Counties, St. Vrain Vy School District
Revenue Refunding, Series A (MBIA Insured)......................... 6.00 12-15-10 3,088,590
2,000 Brighton Revenue Refunding & Improvements (MBIA Insured).............. 6.63 12-01-11 2,117,220
2,000 Goldsmith Metropolitan District, Revenue Refunding (MBIA Insured)..... 6.13 12-01-12 2,039,540
7,000 Jefferson County School District #R-001 (AMBAC Insured )............... 6.00 12-15-12 7,133,280
14,378,630
HEALTH CARE REVENUE (43.0%):
7,000 Colorado Health Facilities Authority Revenue, North Colorado
Medical Center (MBIA Insured)...................................... 6.00 05-15-20 6,945,540
2,000 Colorado Health Facilities Authority Revenue, Sisters of Charity
Health Care, Series A (MBIA Insured)............................... 6.00 05-15-13 2,009,960
2,345 Colorado Health Facilities Authority, Sisters of Charity
Health Care, Series A (AMBAC Insured).............................. 6.00 05-15-22 2,326,170
4,760 Denver City & County Revenue, Childrens Hospital Association
Project (FGIC Insured)............................................. 6.00 10-01-15 4,726,680
3,560 Logan County Health Care Facilities Revenue, Western Health
Network Inc. (MBIA Insured)........................................ 5.90 01-01-19 3,514,823
7,625 University of Colorado Hospital Authority, Hospital Revenue,
Series A (AMBAC Insured)........................................... 6.40 11-15-22 7,861,680
27,384,853
HOUSING REVENUE (4.7%):
$1,100 Colorado School of Mines, Auxiliary Facilities Revenue Refunding
(MBIA Insured)..................................................... 5.00% 12-01-13 996,875
2,000 Snowmass Village Multi-Family Housing, Revenue Refunding
Essential Function Housing (FSA Insured).......................... 6.25 12-15-16 2,002,640
2,999,515
MISCELLANEOUS & SALES TAX REVENUE (8.3%):
1,600 Lafayette Sales & Use Tax Revenue Refunding (AMBAC Insured)............ 5.00 11-15-11 1,462,912
4,000 Regional Transportation District Colorado Sales Tax Revenue
Refunding (FGIC Insured)........................................... 5.38 11-01-10 3,830,880
5,293,792
POLLUTION CONTROL REVENUE (17.9%):
5,000 Adams County Pollution Control Revenue Refunding, Public
Service Company Project, Series A (MBIA Insured)................... 5.88 04-01-14 4,974,500
6,675 Morgan County Pollution Control Revenue Refunding,
1st Meeting Public Service Company, Series A (MBIA Insured)........ 5.50 06-01-12 6,444,446
11,418,946
PRE-REFUNDED/ESCROW (14.4%):
3,000 Adams County School District #1 (FGIC Insured)......................... 6.63 12-01-02 3,305,430
1,500 Denver City & County School District #1, Series B (MBIA Insured)....... 6.50 12-01-01 1,628,895
3,000 Denver Metropolitan Major League Baseball Stadium District,
Revenue Refunding & Improvement Sales Tax, Series A (FGIC Insured). 6.00 10-01-01 3,140,580
1,000 Denver School District #1, Series A (MBIA Insured)..................... 7.25 12-15-00 1,116,880
9,191,785
UTILITY REVENUE (15.3%):
2,120 Colorado Water Reserves & Power Development Authority
Small Water Reserves Revenue Refunding, Series A (FGIC Insured).... 5.00 11-01-10 1,943,340
1,000 Glenwood Springs Water & Sewer Revenue (AMBAC Insured)................. 5.10 12-01-13 916,470
7,900 Municipal Subdistrict Northern Colorado Water Conservation
Refunding, Series E (AMBAC Insured)................................ 5.00 12-01-17 6,909,656
9,769,466
TOTAL INVESTMENTS IN SECURITIES (cost: $104,823,540)(d) $101,341,233
</TABLE>
See accompanying notes to investments in securities on page 40.
VOYAGEUR FUNDS
NOTES TO INVESTMENTS IN SECURITIES
(a) Securities are valued by procedures described in note 2 to the Financial
Statements.
(b) Investment in bonds, by rating category (unaudited) as a percentage of
total bonds, are as follows:
<TABLE>
<CAPTION>
Aaa/AAA Aa/AA A/A Unrated Total
<S> <C> <C> <C> <C> <C>
Minnesota Municipal Income Fund, Inc........ 58% 13% 22% 7% 100%
Minnesota Municipal Income Fund II, Inc..... 59% 12% 23% 6% 100%
Minnesota Municipal Income Fund III, Inc.... 51% 14% 32% 3% 100%
Arizona Municipal Income Fund, Inc.......... 72% 27% 1% -- 100%
Florida Insured Municipal Income Fund....... 100% -- -- -- 100%
Colorado Insured Municipal Income Fund, Inc. 100% -- -- -- 100%
</TABLE>
(c) Dividend yields change daily to reflect current market conditions. Rate
shown is the quoted yield as of March 31, 1995.
(d) The cost of securities for federal income tax purposes for Minnesota
Municipal, Minnesota Municipal II, Minnesota Municipal III, Arizona
Municipal, Florida Insured Municipal and Colorado Insured Municipal were
$56,410,564, $159,870,996, $37,893,072, $63,817,219, $52,287,913 and
$104,823,540, respectively. The aggregate gross unrealized appreciation and
depreciation of securities based on these costs were as follows:
<TABLE>
<CAPTION>
Net
Gross Gross Unrealized
Unrealized Unrealized Appreciation
Appreciation (Depreciation) (Depreciation)
<S> <C> <C> <C>
Minnesota Municipal Income Fund, Inc........ $1,310,985 $ (225,092) $ 1,085,893
Minnesota Municipal Income Fund II, Inc..... 925,985 (3,526,788) (2,600,803)
Minnesota Municipal Income Fund III, Inc.... 572,328 (1,553,180) (980,852)
Arizona Municipal Income Fund, Inc.......... 683,798 (1,384,841) (701,043)
Florida Insured Municipal Income Fund....... 171,028 (1,306,224) (1,135,196)
Colorado Insured Municipal Income Fund, Inc. 297,062 (3,779,369) (3,482,307)
</TABLE>
(e) Securities represent private activity bonds issued after August 7, 1986.
The interest on these securities is a tax preference item for Alternative
Minimum Tax purposes. The ratio of private activity bonds to total
investments in securities as of March 31, 1995 was as follows:
Minnesota Municipal Income Fund, Inc........ 16.6%
Minnesota Municipal Income Fund II, Inc..... 19.9%
Minnesota Municipal Income Fund III, Inc.... 13.7%
Arizona Municipal Income Fund, Inc.......... 0.0%
Florida Insured Municipal Income Fund....... 0.0%
Colorado Insured Municipal Income Fund, Inc. 0.0%
(f) At March 31, 1995, the cost of securities purchased on a when-issued basis
was $4,120,000.
VOYAGEUR FUNDS
FEDERAL INCOME TAX INFORMATION
Information for federal income tax purposes is presented as an aid to
shareholders in reporting the dividend distributions for the fiscal year ended
March 31, 1995 shown below. Shareholders must report distributions on a calendar
year basis for income tax purposes which may include distributions for portions
of two fiscal years. Accordingly, the information required by shareholders for
income tax purposes will be sent in January 1996. Shareholders should consult a
tax adviser on how to report these distributions for state and local purposes.
<TABLE>
<CAPTION>
PER SHARE
VOYAGEUR VOYAGEUR
VOYAGEUR VOYAGEUR VOYAGEUR VOYAGEUR FLORIDA COLORADO
MINNESOTA MINNESOTA MINNESOTA ARIZONA INSURED INSURED
MUNICIPAL MUNICIPAL MUNICIPAL MUNICIPAL MUNICIPAL MUNICIPAL
INCOME INCOME INCOME INCOME INCOME INCOME
FUND, INC. FUND II, INC. FUND III, INC. FUND, INC. FUND FUND, INC.
<S> <C> <C> <C> <C> <C> <C>
Distributions to
Common shareholders from:
Investment income - net (none qualifying for
for the corporate dividend
received deduction):................ $.9300 $.8250 $.7250 $.7813 $.7725 $.7563
Short-term capital gains - net........ .0000 .0000 .0000 .0313 .0000 .0267
Long-term capital gains - net......... .0237 .0000 .0000 .0157 .0000 .0000
Total distributions................. $.9537 $.8250 $.7250 $.8283 $.7725 $.7830
Distributions to
Preferred shareholders from:
Investment income - net (none qualifying
for the corporate dividend received
deduction):
Series A........................ $1,710.47* $1,692.64 $1,685.00* $1,672.30 $1,724.13 $1,651.09
Series B........................ -- 1,742.48 -- 1,695.55 1,742.51 1,713.03
Short-term capital gains:
Series A........................ 0.00* 0.00 0.0 49.84 0.00 47.33
Series B........................ -- 0.00 -- 50.06 0.00 47.12
Long-term capital gains:
Series A........................ 32.24* 0.00 0.00* 25.00 0.00 0.00
Series B........................ -- 0.00 -- 25.10 0.00 0.00
Total distributions
Series A........................ $1,742.71* $1,692.64 $1,685.00* $1,747.14 $1,724.13 $1,698.42
Series B........................ -- $1,742.48 -- $1,770.71 $1,742.51 $1,760.15
</TABLE>
* Represents the single class of preferred stock outstanding.
For Federal income tax purposes, 100% of the above net investment income
distributions were derived from interest on securities exempt from Federal
income tax.
For state income tax purposes, the above net investment income distributions are
100% exempt from each state's respective income tax or personal property tax
except as follows: 99.60% for Florida Insured Municipal.
INVESTMENT ADVISER AND
ACCOUNTING SERVICES AGENT
Voyageur Fund Managers, Inc.
90 South Seventh Street, Suite 4400
Minneapolis, Minnesota 55402-4115
(612) 376-7000 / (800) 553-2143
ADMINISTRATORS
Mitchell Hutchins Asset Management Inc.
New York, New York
Middlesex Administrators L.P.
Plainsboro, New Jersey
(on Colorado Insured Municipal
Income Fund, Inc. only)
CUSTODIAN
First Trust, N.A.
St. Paul, Minnesota
SHAREHOLDER SERVICING AGENT
Norwest Bank Minnesota, N.A.
161 North Concord Exchange
South St. Paul, Minnesota 55075
(612) 450-4064 / (800) 468-9716
PREFERRED SHARES
REMARKETING AGENTS
Smith Barney Inc.
New York, New York
Merrill Lynch, Pierce, Fenner & Smith Incorporated
New York, New York
(on Colorado Insured Municipal
Income Fund, Inc. only)
INDEPENDENT AUDITORS
KPMG Peat Marwick LLP
Minneapolis, Minnesota
GENERAL COUNSEL
Dorsey & Whitney LLLP
Minneapolis, Minnesota
This report, including the financial statements herein, is sent to the
shareholders of the Funds for their information. It is not a prospectus,
circular or representation intended for use in the purchase or sale of shares of
the Funds or any securities mentioned in this report.
