Dreyfus New Jersey
Intermediate Municipal
Bond Fund
Investing for income that is exempt from
federal and New Jersey state income taxes
Prospectus August 1, 1999
As revised, August 10, 1999
As with all mutual funds, the Securities and Exchange Commission has not
approved or disapproved these securities or passed upon the adequacy of this
prospectus.
Any representation to the contrary is a criminal offense.
Contents
The Fund
What every investor 2 Goal/Approach
should know about
the fund 3 Main Risks
4 Past Performance
5 Expenses
6 Management
7 Financial Highlights
Your Investment
Information 8 Account Policies
for managing your
fund account 11 Distributions and Taxes
12 Services for Fund Investors
14 Instructions for Regular Accounts
For More Information
Where to learn more Back Cover
about this and other
Dreyfus funds
[Page]
The Fund
Dreyfus New Jersey Intermediate
Municipal Bond Fund
Ticker Symbol: DNJIX
Goal/Approach
The fund seeks as high a level of income exempt from federal and New Jersey
state income taxes as is consistent with the preservation of capital. To
pursue its goal, the fund normally invests substantially all of its assets in
municipal bonds that provide income exempt from federal and New Jersey
personal income taxes. The fund's dollar-weighted average portfolio maturity
ranges between three and ten years. Although the fund currently intends to
invest only in investment grade municipal bonds, or the unrated equivalent as
determined by Dreyfus, it has the ability to invest up to 20% of net assets
in bonds of below investment grade credit quality.
Municipal bonds are typically divided into two types:
* general obligation bonds, which are secured by the
full faith and credit of the issuer and its taxing power
* revenue bonds, which are payable from the revenues
derived from a specific revenue source, such as charges for
water and sewer service or highway tolls
The fund is non-diversified, which means that a relatively high percentage of
the fund's assets may be invested in a limited number of issuers. Therefore,
its performance may be more vulnerable to changes in the market value of a
single issuer or a group of issuers.
Information on the fund's recent strategies and holdings can be found in the
current annual/semiannual report (see back cover).
Concepts to understand
Average maturity: an average of the stated maturities of the bonds held in
the fund, based on their dollar-weighted proportions in the fund.
Investment grade bonds: independent rating organizations analyze and evaluate
a bond issuer's credit history and ability to repay debts. Based on their
assessment, they assign letter grades that reflect the issuer's
creditworthiness. AAA or Aaa represents the highest credit rating, AA/Aa the
second highest, and so on down to D, for defaulted debt. Bonds rated BBB or
Baa and above are considered investment grade.
[Page 2]
Main Risks
Prices of bonds tend to move inversely with changes in interest rates. While
a rise in rates may allow the fund to invest for higher yields, the most
immediate effect is usually a drop in bond prices and, therefore, in the
fund's share price as well. As a result, the value of your investment in the
fund could go up and down, which means that you could lose money.
Other risk factors could have an effect on the fund's performance:
* if an issuer fails to make timely interest or principal
payments, or there is a decline in the credit quality of
a bond, or perception of a decline, the bond's value
could fall, potentially lowering the fund's share price
* New Jersey's economy and revenues underlying its
municipal bonds may decline
* investing primarily in a single state may make the
fund's portfolio securities more sensitive to risks
specific to the state
Although the fund's objective is to generate income exempt from federal and
New Jersey personal income taxes, interest from some of its holdings may be
subject to the federal alternative minimum tax. In addition, the fund
occasionally may invest in municipal bonds that are exempt only from federal
personal income tax.
Other potential risks
The fund may invest in certain derivatives, such as futures, options and
inverse floaters. Derivatives can be highly sensitive to changes in their
underlying security, interest rate or index and, as a result, can be highly
volatile. A small investment in certain derivatives could have a potentially
large impact on the fund's performance. The fund may use derivatives to:
* increase yield
* hedge against a decline in principal value
* invest with greater efficiency and lower cost
than is possible through direct investment
* adjust the fund's duration
* provide daily liquidity
The Fund [Page 3]
Past Performance
The tables below show some of the risks of investing in the fund. The first
table shows the changes in the fund's performance from year to year. The
second table compares the fund's performance over time to that of the Lehman
Brothers 10-Year Municipal Bond Index, an unmanaged total-return performance
benchmark. Both tables assume reinvestment of dividends. Of course, past
performance is no guarantee of future results.
Year-by-year total return as of 12/31 each year (%)
12.48 -5.21 14.11 3.30 6.94 5.44
89 90 91 92 93 94 95 96 97 98
Best Quarter: Q1 '95 +5.75%
Worst Quarter: Q1 '94 -4.94%
Average annual total return as of 12/31/98
Since
inception
1 Year 5 Years (6/26/92)
- -----------------------------------------------------------------------
Fund 5.44% 4.73% 6.36%
Lehman Brothers
10-Year Municipal
Bond Index 6.76% 6.35% 7.59%*
The fund's year-to-date total return as of 6/30/99 was -1.07%.
* For comparative purposes, the value of the index on 6/30/92
is used as the beginning value on 6/26/92. Unlike the fund,
the Lehman Index is not composed of bonds of a single state.
What this fund is -
and isn't
This fund is a mutual fund: a pooled investment that is professionally
managed and gives you the opportunity to participate in financial markets.
It strives to reach its stated goal, although as with all mutual funds,
it cannot offer guaranteed results.
An investment in this fund is not a bank deposit. It is not insured or
guaranteed by the FDIC or any other government agency. It is not a complete
investment program. You could lose money in this fund, but you also have the
potential to make money.
[Page 4]
Expenses
As an investor, you pay certain fees and expenses in connection with the
fund, which are described in the table below. Shareholder transaction fees
are paid from your account. Annual fund operating expenses are paid out of
fund assets, so their effect is included in the share price. The fund has no
sales charge (load) or Rule 12b-1 distribution fees.
Fee table
Shareholder transaction fees
% of transaction amount
Maximum redemption fee 1.00%
charged only when selling shares you
have owned for less than 15 days
Annual fund operating expenses
% of average daily net assets
Management fee 0.60%
Shareholder Services fee 0.12%
Other expenses 0.12%
Total 0.84%
Expense example
1 Year 3 Years 5 Years 10 Years
- -----------------------------------------------------------------
$86 $268 $466 $1,037
This example shows what you could pay in expenses
over time. It uses the same hypothetical conditions
other funds use in their prospectuses: $10,000 initial
investment, 5% total return each year and no changes in
expenses. The figures shown would be the same whether
you sold your shares at the end of a period or kept them.
Because actual return and expenses will be different,
the example is for comparison only.
Concepts to understand
Management fee: the fee paid to the investment adviser for managing the
fund's portfolio and assisting in all aspects of the fund's operations.
During the past fiscal year, Dreyfus waived a portion of its fee so that the
effective management fee paid by the fund was 0.56%, reducing total expenses
to 0.80%. This waiver was voluntary and subject to termination at any time.
Shareholder services fee: a fee of up to 0.25% used to reimburse Dreyfus Service
Corporation for shareholder account service and maintenance.
Other expenses: fees paid by the fund for miscellaneous items such as
transfer agency, custody, professional and registration fees.
The Fund [Page 5]
Management
The investment adviser for the fund is The Dreyfus Corporation,
200 Park Avenue, New York, New York 10166. Founded in 1947, Dreyfus manages
more than $120 billion in over 160 mutual fund portfolios. For the past
fiscal year, the fund paid Dreyfus a management fee at the annual rate of
0.56% of the fund's average daily net assets. Dreyfus is the primary mutual
fund business of Mellon Bank Corporation, a broad-based financial services
company with a bank at its core. With more than $389 billion of assets under
management, and $1.9 trillion of assets under administration and custody,
Mellon provides a full range of banking, investment and trust products and
services to individuals, businesses and institutions. Mellon is headquartered
in Pittsburgh, Pennsylvania.
Joseph P. Darcy has managed the fund since August 1999 and has been employed
by Dreyfus since May 1994.
Dreyfus has a personal securities trading policy (the "Policy") which
restricts the personal securities transactions of its employees. Its primary
purpose is to ensure that personal trading by Dreyfus employees does not
disadvantage any Dreyfus-managed fund. Dreyfus portfolio managers and other
investment personnel who comply with the Policy's preclearance and disclosure
procedures may be permitted to purchase, sell or hold certain types of
securities which also may be or are held in the fund(s) they advise.
Concepts to understand
Year 2000 issues: the fund could be adversely affected if the computer
systems used by Dreyfus and the fund's other service providers do not
properly process and calculate date-related information from and after
January 1, 2000.
Dreyfus is working to avoid year 2000-related problems in its systems and to
obtain assurances from other service providers that they are taking similar
steps. In addition, issuers of securities in which the fund invests may be
adversely affected by year 2000-related problems. This could have an impact
on the value of the fund's investments and its share price.
[Page 6]
Financial Highlights
This table describes the fund's performance for the fiscal periods indicated.
"Total return" shows how much your investment in the fund would have
increased (or decreased) during each period, assuming you had reinvested all
dividends and distributions. These figures have been independently audited by
Ernst & Young LLP, whose report, along with the fund's financial statements,
is included in the annual report.
<TABLE>
Year Ended March 31,
1999 1998 1997 1996 1995
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Per-Share Data ($)
Net asset value, beginning of period 13.83 13.35 13.44 13.12 13.08
Investment operations:
Investment income - net .59 .59 .59 .60 .65
Net realized and unrealized gain (loss)
on investments .10 .48 (.08) .32 .04
Total from investment operations .69 1.07 .51 .92 .69
Distributions:
Dividends from investment
income - net (.59) (.59) (.60) (.60) (.65)
Net asset value, end of period 13.93 13.83 13.35 13.44 13.12
Total return (%) 5.04 8.18 3.84 7.09 5.45
Ratios/Supplemental Data
Ratio of expenses
to average net assets (%) .80 .78 .78 .72 .45
Ratio of net investment income
to average net assets (%) 4.21 4.34 4.43 4.47 5.02
Decrease reflected in above expense ratios
due to actions by Dreyfus (%) .04 .03 - .06 .45
Portfolio turnover rate (%) 18.81 6.90 14.60 13.69 35.01
Net assets, end of period
($ x 1,000) 217,666 215,843 216,350 229,034 221,199
</TABLE>
The Fund [Page 7]
Your Investment
Account Policies
Buying shares
You pay no sales charges to invest in this fund. Your price for fund shares
is the fund's net asset value per share (NAV), which is generally calculated
as of the close of trading on the New York Stock Exchange (usually 4:00 p.m.
Eastern time) every day the exchange is open.
Your order will be priced at the next NAV calculated after your order is
accepted by the fund's transfer agent or other authorized entity. Because the
fund seeks tax-exempt income, it is not recommended for purchase in IRAs or
other qualified retirement plans.
Minimum investments
Initial Additional
- ------------------------------------------------------------------------------
Regular accounts $2,500 $100
$500 for
TeleTransfer investments
Dreyfus automatic $100 $100
investment plans
All investments must be in U.S. dollars. Third-party
checks cannot be accepted. You may be charged a fee for
any check that does not clear. Maximum TeleTransfer
purchase is $150,000 per day.
Concepts to understand
Net asset value (NAV): a mutual fund's share price on a given day. A fund's
NAV is calculated by dividing the value of its net assets by the number of
existing shares.
When calculating its NAV, the fund's investments are priced at fair value by
an independent pricing service approved by the fund's board. The pricing
service's procedures are reviewed under the general supervision of the board.
[Page 8]
Selling shares
You may sell (redeem) shares at any time. Your shares will be sold at the
next NAV calculated after your order is accepted by the fund's transfer agent
or other authorized entity. Any certificates representing fund shares being
sold must be returned with your redemption request. Your order will be
processed promptly, and you will generally receive the proceeds within a
week.
Before selling recently purchased shares, please note that:
* if the fund has not yet collected payment for the
shares you are selling, it may delay sending the
proceeds for up to eight business days or until it
has collected payment
* if you are selling or exchanging shares you have
owned for less than 15 days, the fund may deduct a
1% redemption fee (not charged on shares sold through
the Automatic Withdrawal Plan or Dreyfus Auto-Exchange
Privilege, or on shares acquired through dividend
reinvestment)
Limitations on selling shares by phone
Proceeds
sent by Minimum Maximum
- ------------------------------------------------------------------------
Check no minimum $150,000 per day
Wire $1,000 $250,000 for joint accounts
every 30 days
TeleTransfer $500 $250,000 for joint accounts
every 30 days
Written sell orders
Some circumstances require written sell orders along with signature
guarantees. These include:
* amounts of $1,000 or more on accounts whose address has
been changed within the last 30 days
* requests to send the proceeds to a different payee or
address Written sell orders of $100,000 or more must also
be signature guaranteed.
A signature guarantee helps protect against fraud. You can obtain one from
most banks or securities dealers, but not from a notary public. For joint
accounts, each signature must be guaranteed. Please call us to ensure that your
signature guarantee will be processed correctly.
Your Investment [Page 9]
Account Policies (continued)
General policies
Unless you decline telephone privileges on your application, you may be
responsible for any fraudulent telephone order as long as Dreyfus takes
reasonable measures to verify the order.
The fund reserves the right to:
* refuse any purchase or exchange request that could
adversely affect the fund or its operations, including
those from any individual or group who, in the fund's
view, is likely to engage in excessive trading (usually
defined as more than four exchanges out of the fund
within a calendar year)
* refuse any purchase or exchange request in excess
of 1% of the fund's total assets
* change or discontinue its exchange privilege, or
temporarily suspend this privilege during unusual
market conditions
* change its minimum investment amounts
* delay sending out redemption proceeds for up to seven
days (generally applies only in cases of very large
redemptions, excessive trading or during unusual
market conditions)
The fund also reserves the right to make a "redemption in kind" - payment in
portfolio securities rather than cash - if the amount you are redeeming is
large enough to affect fund operations (for example, if it represents more
than 1% of the fund's assets).
Small account policies
To offset the relatively higher costs of servicing smaller accounts, the fund
charges regular accounts with balances below $2,000 an annual fee of $12. The
fee will be imposed during the fourth quarter of each calendar year.
The fee will be waived for: any investor whose aggregate Dreyfus mutual fund
investments total at least $25,000; IRA accounts; accounts participating in
automatic investment programs; and accounts opened through a financial
institution.
If your account falls below $500, the fund may ask you to increase your
balance. If it is still below $500 after 30 days, the fund may close your
account and send you the proceeds.
[Page 10]
Distributions and Taxes
The fund usually pays its shareholders dividends from its net investment
income once a month, and distributes any net capital gains it has realized
once a year. Your distributions will be reinvested in the fund unless you
instruct the fund otherwise. There are no fees or sales charges on
reinvestments.
The fund anticipates that virtually all of its income dividends will be
exempt from federal and New Jersey personal income taxes. However, any
dividends from taxable investments, and any capital gain distributions, are
taxable as ordinary income or as capital gains, whether or not you reinvested
them. The tax status of any distribution is the same regardless of how long
you have been in the fund and whether you reinvest your distributions or take
them in cash. In general, distributions are federally taxable as follows:
Taxability of distributions
Type of Tax rate for Tax rate for
distribution 15% bracket 28% bracket or above
- -----------------------------------------------------------------------
Income Generally Generally
dividends tax exempt tax exempt
Short-term Ordinary Ordinary
capital gains income rate income rate
Long-term
capital gains 10% 20%
The tax status of your dividends and distributions will be detailed in your
annual tax statement from the fund.
Because everyone's tax situation is unique, always consult your tax
professional about federal, state and local tax consequences.
Taxes on transactions
Any sale or exchange of fund shares, including through the checkwriting
privilege, may generate a tax liability.
The table at right also can provide a guide for your potential tax liability
when selling or exchanging fund shares. "Short-term capital gains" applies to
fund shares sold or exchanged up to 12 months after buying them. "Long-term
capital gains" applies to shares sold or exchanged after 12 months.
Your Investment [page 11]
Services for fund Investors
Automatic services
Buying or selling shares automatically is easy with the services described
below. With each service, you select a schedule and amount, subject to
certain restrictions. You can set up most of these services with your
application or by calling 1-800-645-6561.
For investing
Dreyfus Automatic For making automatic investments
Asset BuilderRegistration Mark from a designated bank account.
Dreyfus Payroll For making automatic investments
Savings Plan through a payroll deduction.
Dreyfus Government For making automatic investments
Direct Deposit from your federal employment,
Privilege Social Security or other regular
federal government check.
Dreyfus Dividend For automatically reinvesting the
Sweep dividends and distributions from
one Dreyfus fund into another
(not available for IRAs).
For exchanging shares
Dreyfus Auto- For making regular exchanges
Exchange Privilege from one Dreyfus fund into
another.
For selling shares
Dreyfus Automatic For making regular withdrawals
Withdrawal Plan from most Dreyfus funds.
Dreyfus Financial Centers
Through a nationwide network of Dreyfus Financial Centers, Dreyfus offers a
full array of investment services and products. This includes information on
mutual funds, brokerage services, tax-advantaged products and retirement
planning.
Experienced financial consultants can help you make informed choices and
provide you with personalized attention in handling account transactions. The
Financial Centers also offer informative seminars and events. To find the
Financial Center nearest you, call 1-800-499-3327.
[Page 12]
Checkwriting privilege
You may write redemption checks against your account in amounts of $500 or
more. These checks are free; however, a fee may be charged if you request a
stop payment or if the transfer agent cannot honor a redemption check due to
insufficient funds or another valid reason. Please do not postdate your
checks or use them to close your account.
Exchange privilege
You can exchange shares worth $500 or more from one Dreyfus fund into
another. You can request your exchange in writing or by phone. Be sure to
read the current prospectus for any fund into which you are exchanging. Any
new account established through an exchange will have the same privileges as
your original account (as long as they are available). There is currently no
fee for exchanges, although you may be charged a sales load when exchanging
into any fund that has one.
Dreyfus TeleTransfer privilege
To move money between your bank account and your Dreyfus fund account with a
phone call, use the Dreyfus TeleTransfer privilege. You can set up
TeleTransfer on your account by providing bank account information and
following the instructions on your application.
24-hour automated account access
You can easily manage your Dreyfus accounts, check your account balances,
transfer money between your Dreyfus funds, get price and yield information
and much more - when it's convenient for you.
Third-party investments
If you invest through a third party (rather than directly with Dreyfus), the
policies and fees may be different than those described here. Banks, brokers,
financial advisers and financial supermarkets may charge transaction fees and
may set different minimum investments or limitations on buying or selling
shares. Consult a representative of your plan or financial institution if in
doubt.
Your Investment [Page 13]
Instructions for regular accounts
TO OPEN AN ACCOUNT
In Writing
Complete the application.
Mail your application and a check to:
The Dreyfus Family of Funds
P.O. Box 9387, Providence, RI 02940-9387
By Telephone
Wire Have your bank send your
investment to The Bank of New York,
with these instructions:
* ABA# 021000018
* DDA# 8900116692
* the fund name
* your Social Security or tax ID number
* name(s) of investor(s)
Call us to obtain an account number.
Return your application.
Automatically
With an initial investment Indicate
on your application which automatic
service(s) you want. Return your
application with your investment.
Without any initial investment Check
the Dreyfus Step Program option on your
application. Return your application, then
complete the additional materials when
they are sent to you.
Via the Internet
Computer Visit the Dreyfus Web site
http://www.dreyfus.com and follow the
instructions to download an account
application.
TO ADD TO AN ACCOUNT
Fill out an investment slip, and write your
account number on your check.
Mail the slip and the check to:
The Dreyfus Family of Funds
P.O. Box 105, Newark, NJ 07101-0105
Wire Have your bank send your
investment to The Bank of New York,
with these instructions:
* ABA# 021000018
* DDA# 8900116692
* the fund name
* your account number
* name(s) of investor(s)
Electronic check Same as wire, but insert
"1111" before your account number.
TeleTransfer Request TeleTransfer on your
application. Call us to request your transaction.
All services Call us to request a form to
add any automatic investing service (see
"Services for Fund Investors"). Complete
and return the forms along with any other
required materials.
[Page 14]
TO SELL SHARES
Write a redemption check or write a letter of
instruction that includes:
* your name(s) and signature(s)
* your account number
* the fund name
* the dollar amount you want to sell
* how and where to send the proceeds
Obtain a signature guarantee or other documentation,
if required (see "Account Policies - Selling Shares").
Mail your request to:
The Dreyfus Family of Funds
P.O. Box 9671, Providence, RI 02940-9671
Wire Be sure the fund has your bank account
information on file. Call us to request your
transaction. Proceeds will be wired to your bank.
TeleTransfer Be sure the fund has your bank
account information on file. Call us to request
your transaction. Proceeds will be sent to your
bank by electronic check.
Check Call us to request your transaction.
A check will be sent to the address of record.
Dreyfus Automatic Withdrawal Plan Call us
to request a form to add the plan. Complete the
form, specifying the amount and frequency of
withdrawals you would like.
Be sure to maintain an account balance of
$5,000 or more.
To reach Dreyfus, call
toll free in the U.S.
1-800-645-6561
Outside the U.S. 516-794-5452
Make checks payable to:
The Dreyfus Family of Funds
You also can deliver requests
to any Dreyfus Financial Center.
Because processing time may vary,
please ask the representative when
your account will be credited
or debited.
Concepts to understand
Wire transfer: for transferring money from one financial institution to
another. Wiring is the fastest way to move money, although your bank
may charge a fee to send or receive wire transfers. Wire redemptions from the
fund are subject to a $1,000 minimum.
Electronic check: for transferring money out of a bank account. Your
transaction is entered electronically, but may take up to eight business days
to clear. Electronic checks usually are available without a fee at all
Automated Clearing House (ACH) banks.
Your Investment [Page 15]
NOTES
[Page]
[Page]
For More Information
Dreyfus New Jersey
Intermediate Municipal Bond Fund
SEC file number: 811-6643
More information on this fund is available free
upon request, including the following:
Annual/Semiannual Report
Describes the fund's performance, lists portfolio
holdings and contains a letter from the fund's
manager discussing recent market conditions,
economic trends and fund strategies that
significantly affected the fund's performance during
the last fiscal year.
Statement of Additional Information (SAI)
Provides more details about the fund and its
policies. A current SAI is on file with the
Securities and Exchange Commission (SEC) and is
incorporated by reference (is legally considered
part of this prospectus).
To obtain information:
By telephone
Call 1-800-645-6561
By mail Write to:
The Dreyfus Family of Funds
144 Glenn Curtiss Boulevard
Uniondale, NY 11556-0144
By E-mail Send your request
to [email protected]
On the Internet Text-only
versions of fund documents
can be viewed online or
downloaded from:
SEC
http://www.sec.gov
Dreyfus
http://www.dreyfus.com
You can also obtain copies by visiting the SEC's Public Reference Room in
Washington, DC (phone 1-800-SEC-0330) or by sending your request and a
duplicating fee to the SEC's Public Reference Section, Washington,
DC 20549-6009.
Copy Rights 1999 Dreyfus Service Corporation 751P0899A
