<PAGE> 1
The Eaton Vance Municipals Trust
For the Portfolios:
Arizona Tax Free Portfolio
Colorado Tax Free Portfolio
Connecticut Tax Free Portfolio
Michigan Tax Free Portfolio
Minnesota Tax Free Portfolio
New Jersey Tax Free Portfolio
Pennsylvania Tax Free Portfolio
Texas Tax Free Portfolio
[LOGO]
Annual Shareholder Report
July 31, 1995
Portfolio Investment Adviser
Boston Management and Research
24 Federal Street
Boston, MA 02110
Fund Administrator
Eaton Vance Management
24 Federal Street
Boston, MA 02110
(617) 482-8260
Custodian
Investors Bank & Trust Company
24 Federal Street
Boston, MA 02110
Transfer Agent
The Shareholder Services Group, Inc.
BOS725
P.O. Box 1559
Boston, MA 02104
Independent Auditors
Deloitte & Touche LLP
125 Summer Street
Boston, MA 02110
<PAGE> 2
<TABLE>
- --------------------------------------------------------------------------------
Arizona Tax Free Portfolio
Portfolio of Investments - July 31, 1995
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS - 100%
- --------------------------------------------------------------------------------
<CAPTION>
RATINGS
(UNAUDITED)
- ----------------- PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
EDUCATION - 4.8%
A1 AA $1,000 Arizona Board of Regents,
Arizona State University,
5.90%, 7/01/09 $ 1,015,710
NR AAA 1,000 City of Glendale,
Thunderbird Graduate
School, CLEE, 7.125%,
7/01/20 1,099,650
A1 AA 1,250 Arizona Board of Regents,
University of Arizona,
6.25%, 6/01/11 1,283,100
NR NR 2,000 Arizona Educational Loan
Marketing Corporation,
(AMT) 6.30%, 12/01/08 1,921,460
A NR 1,500 Student Loan Acquisition
Authority of Arizona,
(AMT) 7.625%, 5/01/10 1,630,230
------------
$ 6,950,150
------------
ESCROWED - 6.2%
Aaa AA $2,500 Arizona Transportation
Board Highway, 6.50%,
7/01/11 $ 2,797,850
Aaa AAA 7,500 Maricopa County, Single
Family Mortgage, 0%,
2/01/16 2,145,825
NR AA 2,500 City of Phoenix, Street &
Highway User, 6.25%,
7/01/11 2,696,950
Baa1 AAA 630 Puerto Rico Electric Power
Authority, 7.125%, 7/01/14 705,039
NR NR 500 City of Scottsdale,
Westminster Village,
Multifamily Housing,
10.00%, 6/01/17 565,310
------------
$ 8,910,974
------------
GENERAL OBLIGATION - 7.9%
Aa AA+ $1,500 City of Phoenix, 6.375%,
7/01/13 $ 1,556,085
Aa AA+ 1,000 City of Phoenix, 5.55%,
7/01/09 1,001,860
Aa AA+ 3,000 City of Phoenix, 5.10%,
7/01/13 2,774,070
Aa1 AA+ 1,000 City of Scottsdale, 5.50%,
7/01/12 957,500
NR A 2,000 City of Phoenix, Tatum
Ranch Community, 6.875%,
7/01/16 2,106,600
Aa AA+ 1,000 City of Tempe, 5.25%,
7/01/15 925,490
Aa AA 1,300 Scottsdale Unified School
District No. 48 of
Maricopa County, 4.60%,
7/01/11 1,146,665
Baa1 A 1,000 Commonwealth of Puerto
Rico, 5.75%, 7/01/16 953,220
------------
$ 11,421,490
------------
HOSPITALS - 3.2%
NR BBB $1,130 Arizona Health Facilities
Authority, Phoenix
Memorial Hospital, 8.125%,
6/01/12 $ 1,202,376
NR BBB 1,250 Arizona Health Facilities
Authority, Phoenix
Memorial Hospital, 8.20%,
6/01/21 (2) 1,331,413
Baa BB+ 1,000 Maricopa County, Sun
Health Corporation,
8.125%, 4/01/12 1,065,980
<CAPTION>
RATINGS
(UNAUDITED)
- ----------------- PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
NR NR 915 City of Winslow, Winslow
Memorial Hospital Project,
9.50%, 6/01/22 1,003,535
------------
$ 4,603,304
------------
HOUSING - 5.7%
NR A $2,000 Maricopa County, Laguna
Point Apartments,
Multifamily Housing,
6.75%, 7/01/09 $ 1,990,440
NR AAA 2,775 City of Phoenix, Chris
Ridge Village Project, FHA
Insured Mortgage Loan,
6.80%, 11/01/25 2,812,546
NR AA 1,000 City of Phoenix, Woodstone
and Silver Springs
Apartments, Multifamily
Housing, (Asset Guaranty),
6.25%, 4/01/23 989,500
Aaa NR 1,500 City of Phoenix, Meadow
Glen Apartments,
Multifamily Housing, (GNMA
Collateralized) 5.80%,
8/20/28 1,367,325
NR AAA 1,000 City of Tempe, Multifamily
Housing, Quadrangle
Village Apartments, FHA
Insured Mortgage Loan,
6.25%, 6/01/26 982,450
------------
$ 8,142,261
------------
INDUSTRIAL DEVELOPMENT
REVENUE / IDB - 3.7%
A1 NR $1,000 City of Casa Grande,
Pollution Control,
Frito-Lay Inc., 6.60%,
12/01/10 $ 1,059,800
A2 A 4,500 Greenlee County, Pollution
Control, Phelps Dodge
Corporation, 5.45%,
6/01/09 4,318,155
------------
$ 5,377,955
------------
INSURED GENERAL OBLIGATION - 8.6%
Aaa AAA $1,000 Peoria Unified School
District No. 11 of
Maricopa County, (MBIA)
6.40%, 7/01/10 $ 1,051,570
Aaa AAA 1,300 Alhambra Elementary School
District No. 68 of
Maricopa County, (AMBAC)
5.50%, 7/01/07 1,322,776
Aaa AAA 1,000 Alhambra Elementary School
District No. 68 of
Maricopa County, (AMBAC)
5.625%, 7/01/13 997,140
Aaa AAA 1,000 Alhambra Elementary School
District No. 68 of
Maricopa County, (AMBAC)
5.125%, 7/01/13 921,170
Aaa AAA 1,000 Paradise Valley Unified
School District No. 69 of
Maricopa County, (AMBAC),
5.00%, 7/01/09 929,690
</TABLE>
33
<PAGE> 3
<TABLE>
- --------------------------------------------------------------------------------
ARIZONA TAX FREE PORTFOLIO (CONTINUED)
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS (CONTINUED)
- --------------------------------------------------------------------------------
<CAPTION>
RATINGS
(UNAUDITED)
- ----------------- PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- --------------------------------------------------------------------
<S> <C> <C> <C> <C>
INSURED GENERAL OBLIGATION -
(CONTINUED)
Aaa AAA 1,000 Chandler Unified School
District No. 80 of
Maricopa County, (FGIC)
6.40%, 7/01/10 1,047,450
Aaa AAA 1,000 Pima County, School
District No. 1, Tucson
Project, (FGIC) 5.40%,
7/01/13 949,340
Aaa AAA 1,750 Pima County, School
District No. 1, Tucson
Project, (FGIC) 5.875%,
7/01/14 1,742,965
Aaa AAA 1,000 Commonwealth of Puerto
Rico, (FSA) 7/01/20 (1) 963,790
Aaa AAA 1,500 Commonwealth of Puerto
Rico, (AMBAC) 7/01/15 (1) 1,492,485
Aaa AAA 1,000 Commonwealth of Puerto
Rico, (FSA) 7/01/22 (1) 1,003,110
------------
$ 12,421,486
------------
INSURED HOSPITALS - 13.1%
Aaa AAA $2,000 Maricopa County, Hospital
District No.1, (FGIC)
6.125%, 6/01/15 (2) $ 2,021,080
Aaa AAA 3,500 Maricopa County, Catholic
Healthcare West, (MBIA)
5.625%, 7/01/23 3,336,655
Aaa AAA 2,000 Maricopa County, Samaritan
Health, (MBIA) 7.00%,
12/01/16 2,280,640
Aaa AAA 2,000 Mohave County, Hospital
District No.1, Kingman
Regional Medical Center,
(FGIC) 6.50%, 6/01/15 2,084,440
Aaa AAA 1,500 Pima County, Tucson
Medical Center, (MBIA)
6.375%, 4/01/12 1,550,700
Aaa AAA 3,500 Pima County, Tucson
Medical Center, (MBIA)
5.00%, 4/01/15 3,098,795
Aaa AAA 1,000 Pima County, Carondelet
Health Care Corporation,
(MBIA) 5.25%, 7/01/11 938,350
Aaa AAA 1,000 Pima County, Carondelet
Health Care Corporation,
(MBIA) 5.25%, 7/01/12 930,980
Aaa AAA 2,000 University of Arizona
Medical Center
Corporation, (MBIA) 5.00%,
7/01/13 1,802,480
Aaa AAA 1,000 University of Arizona
Medical Center
Corporation, (MBIA) 5.00%,
7/01/21 869,300
------------
$ 18,913,420
------------
INSURED HOUSING - 1.3%
Aaa AAA $1,975 City of Sierra Vista,
Mountain View Apartments,
FHA Insured Mortgage,
(MBIA) 5.75%, 1/01/24 $ 1,849,331
------------
<CAPTION>
RATINGS
(UNAUDITED)
- ----------------- PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
INSURED UTILITIES - 5.9%
Aaa AAA $4,000 Navajo County, Pollution
Control, Arizona Public
Service Co., (AMBAC)
5.50%, 8/15/28 $ 3,687,000
Aaa AAA 3,500 Pima County, Irvington
Power Project, (FSA)
7.25%, 7/15/10 (2) 3,842,300
Aaa AAA 1,000 Arizona State Power
Authority, Hoover Uprating
Project, (MBIA) 5.25%,
10/01/17 909,770
------------
$ 8,439,070
------------
INSURED MISCELLANEOUS - 0.7%
Aaa AAA $1,000 Maricopa County Stadium
District, (MBIA) 5.50%,
7/01/13 $ 956,070
------------
INSURED SPECIAL TAX - 1.3%
Aaa AAA $1,750 City of Phoenix, Civic
Improvement Excise Tax,
(MBIA) 6.60%, 7/01/08 $ 1,895,793
------------
INSURED TRANSPORTATION - 0.7%
Aaa AAA $1,000 City of Tucson, Junior
Lien Street and Highway,
(MBIA) 5.50%, 7/01/12 $ 952,370
------------
INSURED WATER & SEWER - 1.4%
Aaa AAA $1,000 City of Chandler, Water
and Sewer, (FGIC) 6.25%,
7/01/13 $ 1,024,610
Aaa AAA 1,200 City of Phoenix, Civic
Improvement Wastewater
Systems, (MBIA) 5.00%,
7/01/18 1,058,340
------------
$ 2,082,950
------------
TRANSPORTATION - 6.7%
Aa AA $1,000 State of Arizona,
Transportation Board &
Highway, 5.00%, 7/01/10 $ 928,360
Aa AA 2,000 State of Arizona,
Transportation Board &
Highway, 5.10%, 7/01/11 1,851,780
Baa1 A 1,000 Puerto Rico Highway and
Transportation Authority,
5.25%, 7/01/20 881,340
Baa1 A 1,000 Puerto Rico Highway and
Transportation Authority,
5.25%, 7/01/21 879,370
</TABLE>
34
<PAGE> 4
<TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS (CONTINUED)
- --------------------------------------------------------------------------------
<CAPTION>
RATINGS
(UNAUDITED)
- ----------------- PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
TRANSPORTATION - (CONTINUED)
A1 A+ 2,250 City of Tucson, Arizona,
Senior Lien Street and
Highway, 5.50%, 7/01/09 2,173,523
NR BBB 3,000 Guam Airport Authority,
(AMT) 6.70%, 10/01/23 2,999,610
------------
$ 9,713,983
------------
UTILITIES - 20.3%
Baa2 BBB $1,500 Coconino County, Pollution
Control, Nevada Power Co.,
7.125%, 10/01/06 $ 1,502,730
Ba2 BB 2,500 Maricopa County, Pollution
Control, Public Service
Company of New Mexico,
Palo Verde Project,
6.375%, 8/15/23 2,376,600
Baa1 BBB 5,300 Navajo County, Pollution
Control, Arizona Public
Service Co., 5.875%,
8/15/28 4,932,975
NR AAA 1,000 Mohave County, Citizens
Utilities Company Project,
(AMT) 5.80%, 11/15/28 958,740
A A+ 1,000 Puerto Rico Telephone
Authority, 1/01/20 (1) 1,009,540
A1 AA- 1,000 Central Arizona Water
Conservation District,
Central Arizona Project,
5.50%, 11/01/09 989,209
NR BBB 1,200 Guam Power Authority,
6.30%, 10/01/12 1,193,652
NR BBB 1,250 Guam Power Authority,
6.30%, 10/01/22 1,218,162
Baa1 A- 1,500 Puerto Rico Electric Power
Authority, 7.00%, 7/01/07 1,603,410
Baa1 A- 5,000 Puerto Rico Electric Power
Authority, 5.00%, 7/01/12 4,429,250
Baa1 A- 370 Puerto Rico Electric Power
Authority, 7.125%, 7/01/14 401,210
Aa AA 1,750 Salt River Project
Agricultural Improvement
and Power District, Salt
River Project Electric
System, 5.50%, 1/01/28 1,600,008
Aa AA 3,500 Salt River Project
Agricultural Improvement
and Power District, Salt
River Project Electric
System, 5.50%, 1/01/25 3,227,735
Aa AA 1,000 Salt River Project
Agricultural Improvement
and Power District, Salt
River Project Electric
System, 6.25%, 1/01/27 1,012,300
<CAPTION>
RATINGS
(UNAUDITED)
- ----------------- PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
Aa AA 1,000 Salt River Project
Agricultural Improvement
and Power District, Salt
River Project Electric
System, 5.25%, 1/01/13 917,570
Aa AA 2,000 Salt River Project
Agricultural Improvement
and Power District, Salt
River Project Electric
System, 5.25%, 1/01/19 1,796,320
------------
$ 29,169,411
------------
WATER & SEWER - 8.5%
Aa AA+ $2,000 State of Arizona,
Wastewater Management
Authority, 6.80%, 7/01/11
(2) $ 2,163,140
A1 A 1,100 City of Phoenix, Water
System, 5.00%, 7/01/18 966,405
A1 A 5,000 City of Phoenix, Water
System, 4.75%, 7/01/23 4,140,550
A1 AA- 1,000 City of Phoenix, Water
System, 5.40%, 7/01/14 942,330
A1 A+ 1,000 City of Tucson, Water
System, 6.50%, 7/01/16 1,046,420
A1 A+ 1,000 City of Tucson, Water
System, 5.50%, 7/01/08 1,019,410
A1 A+ 1,000 City of Tucson, Water
System, 5.50%, 7/01/09 989,410
A1 A+ 1,000 City of Tucson, Water
System, 5.50%, 7/01/10 979,050
------------
$ 12,246,715
------------
TOTAL TAX-EXEMPT
INVESTMENTS (IDENTIFIED
COST, $140,218,111) $144,046,733
============
<FN>
(1) The above designated securities have been issued as inverse floater bonds.
(2) Security has been segregated to cover margin requirements for open financial
futures contracts.
</TABLE>
The Portfolio invests primarily in debt securities issued by Arizona
municipalities. The ability of the issuers of the debt securities to meet their
obligations may be affected by economic developments in a specific industry or
municipality. In order to reduce the risk associated with such economic
developments, at July 31, 1995, 36.6% of the securities in the portfolio of
investments are backed by bond insurance of various financial guaranty assurance
agencies. The aggregate percentage by financial institution ranges from 0.9% to
16.3% of total investments.
See notes to financial statements
35
<PAGE> 5
<TABLE>
- --------------------------------------------------------------------------------
Colorado Tax Free Portfolio
Portfolio of Investments - July 31, 1995
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS - 100%
- --------------------------------------------------------------------------------
<CAPTION>
RATINGS
(UNAUDITED)
- ----------------- PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
EDUCATION - 2.0%
A1 A+ $1,000 City of Colorado Springs,
Colorado College Project,
5.125%, 6/01/16 $ 902,140
-----------
ESCROWED - 1.6%
Aaa AAA $4,000 Colorado Health Facilities
Authority, Liberty Heights
Project, (FSA) 0%, 7/15/24 $ 538,160
NR AAA 150 Puerto Rico Highway and
Transportation Authority,
6.50%, 7/01/22 169,296
-----------
$ 707,456
-----------
GENERAL OBLIGATION - 9.4%
A NR $ 500 City of Aspen, 5.625%,
4/15/14 $ 467,330
Aa AA 1,000 City and County of Denver,
5.10%, 9/01/09 938,710
Aa AA 1,000 Boulder and Gilpin
Counties, Boulder Valley
School District, 6.30%,
12/01/13 1,032,600
NR A 750 Larimer, Weld & Boulder
Counties, Thompson School
District, 6.05%, 12/15/08 770,422
Baa1 A 1,000 Commonwealth of Puerto
Rico, 5.75%, 7/01/15 959,900
NR NR 100 Virgin Islands Public
Finance Authority, 7.25%,
10/01/18 103,155
-----------
$ 4,272,117
-----------
HOSPITALS - 10.4%
Baa1 BBB+ $1,250 Boulder County, Longmont
United Hospital, 5.875%,
12/01/20 $ 1,160,750
Baa BBB 2,050 Colorado Health Facilities
Authority, Rocky Mountain
Adventist Healthcare,
6.625%, 2/01/13 1,999,304
A NR 250 Colorado Health Facilities
Authority, Craig Hospital,
5.375%, 12/01/13 228,340
A NR 500 Colorado Health Facilities
Authority, Craig Hospital,
5.50%, 12/01/21 449,450
Baa1 BBB+ 250 Colorado Health Facilities
Authority, Swedish Medical
Center, 6.80%, 1/01/23 252,050
NR BBB- 650 Colorado Health Facilities
Authority, National Jewish
Center, 6.875%, 2/15/12 628,524
-----------
$ 4,718,418
-----------
HOUSING - 11.6%
NR NR $ 350 Lake Creek Affordable
Housing Corporation,
Multifamily Housing, 8.00%,
12/01/23 $ 352,786
NR AAA 1,000 City of Lakewood, Multi
Family Housing FHA Insured
Mortgage Loan, (AMT) 6.65%,
10/01/25 1,004,010
<CAPTION>
RATINGS
(UNAUDITED)
- ----------------- PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
Aa NR 1,975 Colorado Housing and
Finance Authority, Single
Family Access Program,
7.90%, 12/01/24 2,163,810
Aa NR 990 Colorado Housing and
Finance Authority, Single
Family Access Program,
8.00%, 12/01/24 (3) 1,093,682
Aa NR 600 Colorado Housing and
Finance Authority, Single
Family Housing, (AMT)
7.65%, 12/01/25 (2) 651,786
-----------
$ 5,266,074
-----------
INDUSTRIAL DEVELOPMENT
REVENUE - 3.4%
A2 NR $1,750 Puerto Rico Pollution
Control, American Home
Products Corporation,
5.10%, 12/01/18 $ 1,541,488
-----------
INSURED EDUCATION - 2.1%
Aaa AAA $1,000 Board of Trustees of the
State Colleges in Colorado,
Adams State College of
Colorado Project, (MBIA)
5.70%, 5/15/14 $ 976,260
-----------
INSURED GENERAL OBLIGATION - 11.4%
Aaa AAA $ 500 City and County of Denver
School District #1, (MBIA)
5.125%, 12/01/12 $ 455,225
Aaa AAA 1,000 Douglas and Elbert
Counties, Douglas County
School District, (MBIA)
6.40%, 12/15/11 1,050,140
Aaa AAA 1,750 Eagle, Garfield & Routt
Counties, School District
No. RE 50J, (FGIC) 6.30%,
12/01/12 1,827,648
Aaa AAA 1,000 Poudre School District R-1
of Larimer County, (MBIA)
6.50%, 12/15/11 1,060,090
Aaa AAA 750 Pueblo County School
District No.70, Pueblo
Rural, (AMBAC) 6.40%,
12/01/14 778,703
-----------
$ 5,171,806
-----------
INSURED HOSPITALS - 15.0%
Aaa AAA $2,500 Colorado Health Facilities
Authority, Sisters of
Charity, (MBIA) 5.25%,
5/15/14 $ 2,292,825
Aaa AAA 2,000 Colorado Health Facilities
Authority, Boulder
Community Hospital, (MBIA)
5.875%, 10/01/23 1,942,220
Aaa AAA 1,000 Colorado Springs Hospital,
(MBIA) 6.00%, 12/15/24 980,970
Aaa AAA 500 City and County of Denver,
Childrens Hospital, (FGIC)
6.00%, 10/01/15 504,490
</TABLE>
36
<PAGE> 6
<TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS (CONTINUED)
- --------------------------------------------------------------------------------
<CAPTION>
RATINGS
(UNAUDITED)
- ----------------- PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
INSURED HOSPITALS - (CONTINUED)
Aaa AAA 1,000 Pueblo County, Parkview
Episcopal Medical Center,
(MBIA) 7.00%, 9/01/09 1,076,760
-----------
$ 6,797,265
-----------
INSURED HOUSING - 2.3%
Aaa AAA $1,000 City of Thornton, SCA
Realty MFMR, (FSA) 7.10%,
1/01/30 (2) $ 1,025,850
-----------
INSURED UTILITIES - 0.7%
Aaa AAA $ 300 Puerto Rico Electric Power
Authority, (FSA) 7/01/03
(1) $ 328,491
-----------
INSURED SPECIAL TAX - 4.5%
Aaa AAA $2,000 City of Broomfield Sales
and User Tax, (AMBAC)
6.30%, 12/01/14 $ 2,061,200
-----------
INSURED TRANSPORTATION - 4.3%
Aaa AAA $2,100 City and County of Denver,
Colorado Airport System,
(MBIA) 5.60%, 11/15/20 $ 1,967,889
-----------
INSURED WATER & SEWER - 1.9%
Aaa AAA $1,000 Municipal Subdistrict,
Northern Colorado Water
Conservancy District,
(AMBAC) 5.00%, 12/01/17 $ 883,370
-----------
TRANSPORTATION - 11.1%
Baa3 BB $1,500 City and County of Denver,
Colorado Special Facilities
Airport System, United
Airlines, (AMT) 6.875%,
10/01/32 $ 1,501,320
Baa BB 500 City and County of Denver,
Colorado Airport System,
(AMT) 6.75%, 11/15/22 499,930
Baa BB 500 City and County of Denver,
Colorado Airport System,
(AMT) 7.50%, 11/15/23 534,105
<CAPTION>
RATINGS
(UNAUDITED)
- ----------------- PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
NR BBB 100 Guam Airport Authority,
(AMT) 6.70%, 10/01/23 99,987
Baa1 A 2,750 Puerto Rico Highway and
Transportation Authority,
5.25%, 07/01/20 2,423,685
-----------
$ 5,059,027
-----------
UTILITIES - 8.3%
Aa AA $1,500 City of Colorado Springs,
Utilities System, 5.125%,
11/15/23 (4) $ 1,313,010
NR BBB 350 Guam Power Authority,
5.25%, 10/01/13 310,544
NR BBB 500 Guam Power Authority,
6.625%, 10/01/14 506,825
Aa A+ 1,750 Platte River Power
Authority, 5.50%, 6/01/18 1,627,465
-----------
$ 3,757,844
-----------
TOTAL TAX-EXEMPT
INVESTMENTS (IDENTIFIED
COST, $44,277,269) $45,436,695
===========
<FN>
(1) The above designated securities have been issued as inverse floater bonds.
(2) When-issued security.
(3) Security has been segregated to cover when-issued securities.
(4) Security has been segregated to cover margin requirements for open financial
futures contracts.
</TABLE>
The Portfolio primarily invests in debt securities issued by Colorado
municipalities. The ability of the issuers of the debt securities to meet their
obligations may be affected by economic developments in a specific industry or
municipality. In order to reduce the risk associated with such economic
developments, at July 31, 1995, 45.7% of the securities in the portfolio of
investments are backed by bond insurance of various financial institutions and
financial guaranty assurance agencies. The aggregate percentage by financial
institution ranged from 1.1% to 30.0% of total investments.
See notes to financial statements
37
<PAGE> 7
<TABLE>
- --------------------------------------------------------------------------------
Connecticut Tax Free Portfolio
Portfolio of Investments - July 31, 1995
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS - 100%
- --------------------------------------------------------------------------------
<CAPTION>
RATINGS
(UNAUDITED)
- ----------------- PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
EDUCATION - 10.8%
Baa BBB $1,000 Connecticut HEFA,
University of Hartford,
6.75%, 7/01/12 $ 975,350
Baa BBB 5,500 Connecticut HEFA,
University of Hartford,
6.80%, 7/01/22 5,302,660
NR BBB- 6,175 Connecticut HEFA,
Quinnipiac College, 6.00%,
7/01/23 5,497,294
NR BBB- 1,000 Connecticut HEFA, Sacred
Heart University, 6.80%,
7/01/12 1,045,400
NR A- 1,000 Connecticut HEFA, Sacred
Heart University, 5.80%,
7/01/23 842,940
NR A 1,125 Connecticut HEFA, Taft
School, 5.40%, 7/01/20 1,011,476
Aaa AAA 6,000 Connecticut HEFA, Yale
University, 5.929%,
6/10/30 5,929,680
------------
$ 20,604,800
------------
ESCROWED TO MATURITY - 2.4%
NR AA- $ 650 State of Connecticut
Government Obligations
Bonds, 6.875%, 7/15/10 $ 729,775
NR AAA 800 Connecticut Special Tax
Obligation Bonds,
Transportation
Infrastructure Purposes,
6.75%, 6/01/11 906,304
A1 AA- 645 Connecticut Special Tax
Obligation Bonds,
Transportation
Infrastructure Purposes,
6.50%, 7/01/09 706,475
A1 AA- 300 Amity RSD No. 5 Bonds,
6.80%, 6/15/08 326,166
Baa BBB 1,630 City of Stratford,
Government Obligations
Bonds, 7.30%, 3/01/12 1,869,561
------------
$ 4,538,281
------------
GENERAL OBLIGATION - 6.1%
Aa1 NR $ 350 City of Avon, 4.60%,
1/15/07 $ 327,159
Aa NR 525 Town of Guilford, 4.75%,
11/15/10 476,017
Aa NR 525 Town of Guilford, 4.75%,
11/15/11 471,466
A AA- 2,000 City of Bridgeport,
6.125%, 3/01/05 2,073,380
Aa AA- 1,750 State of Connecticut,
Capital Appreciation
Bonds, 0%, 11/01/09 781,515
AA AA- 1,000 State of Connecticut,
5.50%, 3/15/10 983,190
AA AA- 500 State of Connecticut,
5.50%, 3/15/11 491,235
Aa AA 1,270 City of Danbury, 4.50%,
2/01/14 1,062,634
Aa1 NR 650 City of Farmington, 5.70%,
1/15/11 657,306
<CAPTION>
RATINGS
(UNAUDITED)
- ----------------- PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
NR BBB 500 Government of Guam, 5.40%,
11/15/18 431,735
Aa1 AA+ 925 City of Norwalk Maritime
Center Project Bonds,
6.05%, 2/01/09 952,574
Baa1 A 2,000 Puerto Rico PBA Bonds,
5.50%, 7/01/21 1,832,480
NR NR 1,000 Virgin Islands PFA Revenue
Bonds, 7.25%, 10/01/18 1,031,550
------------
$ 11,572,241
------------
HEALTH CARE (NON-HOSPITAL) - 12.5%
A1 AA- $ 600 Connecticut HEFA, Nursing
Home Program NHP (Noble
Horizons), 6.00%, 11/01/22 $ 586,554
A1 AA- 1,000 Connecticut HEFA, NHP
(Jewish Home-Fairfield),
6.25%, 11/01/20 1,008,720
A1 AA- 655 Connecticut HEFA, NHP (St.
Camillus), 6.25%, 11/01/18 661,766
A1 AA- 3,250 Connecticut HEFA, NHP (St.
Joseph's Manor) 6.25%,
11/01/16 3,283,573
A1 AA- 1,365 Connecticut HEFA, NHP
(Sharon Healthcare) 6.25%,
11/01/14 1,385,762
Aa3 NR 9,000 Connecticut Development
Authority Health Care
Bonds (Duncaster), 6.75%,
9/01/15 9,301,230
A1 AA- 720 Connecticut HEFA, NHP
(Highland View), 7.00%,
11/01/07 787,975
A1 AA- 335 Connecticut HEFA, NHP
(Wadsworth Glen), 7.00%,
11/01/07 366,627
A1 AA- 2,000 Connecticut HEFA, NHP
(Wadsworth Glen), 7.50%,
11/01/16 2,210,800
A1 AA- 3,000 Connecticut HEFA, NHP
(Windsor), 7.125%,
11/01/14 3,254,820
NR A- 1,000 Puerto Rico I. M. E. (Dr.
Pila Hospital), (FHA)
7.85%, 8/01/28 1,078,190
------------
$ 23,926,017
------------
HOSPITALS - 6.0%
NR A- $3,770 Connecticut HEFA, William
W. Backus Hospital,
6.375%, 7/01/22 $ 3,748,096
Baa1 NR 9,150 Connecticut HEFA, Griffin
Hospital, 5.75%, 7/01/23 7,814,009
------------
$ 11,562,105
------------
HOUSING - 8.2%
Aa AA $ 100 Connecticut HFA Mortgage
Revenue Bonds (MRB),
7.40%, 11/15/99 $ 102,965
</TABLE>
38
<PAGE> 8
<TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS (CONTINUED)
- --------------------------------------------------------------------------------
<CAPTION>
RATINGS
(UNAUDITED)
- ----------------- PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
HOUSING - (CONTINUED)
Aa AA 1,400 Connecticut HFA, MRB,
7.20%, 11/15/01 1,473,556
Aa AA 200 Connecticut HFA, MRB,
7.00%, 11/15/09 207,336
Aa AA 6,200 Connecticut HFA, MRB,
6.70%, 11/15/12 6,336,524
Aa AA 250 Connecticut HFA, MRB,
6.55%, 11/15/13 252,910
Aa AA 1,000 Connecticut HFA, MRB,
5.85%, 11/15/16 955,420
Aa AA 120 Connecticut HFA, MRB,
7.625%, 11/15/17 123,988
Aa AA 1,700 Connecticut HFA, MRB,
6.35%, 5/15/17 1,674,177
Aa AA 2,500 Connecticut HFA, MRB,
6.60%, 11/15/23 2,511,700
Aa AA 2,000 Connecticut HFA, MRB,
6.75%, 11/15/23 2,030,000
------------
$ 15,668,576
------------
INDUSTRIAL DEVELOPMENT/POLLUTION
CONTROL REVENUES - 3.0%
Aaa AAA $1,000 Connecticut Development
Authority (Pfizer Inc.),
6.55%, 2/15/13 $ 1,071,700
Aa AA- 2,000 Connecticut Development
Authority (Economic
Development Projects),
Revenue Bonds, 6.00%,
11/15/08 2,066,960
A1 A+ 2,000 Connecticut Development
Authority (New England
Power Company Project),
7.25%, 10/15/15 2,142,580
Baa1 A 500 Puerto Rico Port Authority
(American Airlines),
6.30%, 6/01/23 485,275
------------
$ 5,766,515
------------
INSURED AIRPORTS - 4.9%
Aaa AAA $8,200 State of Connecticut
Airport Revenue Bonds,
Bradley International
Airport, (FGIC), 7.65%,
10/01/12 $ 9,315,364
------------
INSURED COLLEGE AND UNIVERSITY - 3.9%
Aaa AAA $ 725 Connecticut HEFA,
Fairfield University
(MBIA), 5.00%, 7/01/18 $ 636,129
Aaa AAA 1,200 Connecticut HEFA,
Connecticut College
(MBIA), 6.625%, 7/01/11 1,272,948
Aaa AAA 2,000 Connecticut HEFA, Trinity
College (MBIA), 6.00%,
7/01/22 2,003,960
Aaa AAA 1,555 Connecticut HEFA, Choate
Rosemary College (MBIA),
6.80%, 7/01/15 (1) 1,683,661
<CAPTION>
RATINGS
(UNAUDITED)
- ----------------- PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
Aaa AAA 750 Connecticut HEFA, Loomis
Chafee (MBIA), 6.00%,
7/01/15 760,793
Aaa AAA 1,000 Connecticut HEFA, Loomis
Chafee (MBIA), 6.00%,
7/01/25 1,005,850
------------
$ 7,363,341
------------
INSURED MISCELLANEOUS - 0.8%
Aaa AAA $1,750 Connecticut Municipal
Electric Energy
Cooperative Bonds (MBIA),
5.00%, 1/01/18 $ 1,549,520
------------
INSURED GOVERNMENT OBLIGATIONS - 4.3%
Aaa AAA $1,220 Town of Bethel, (MBIA),
6.50%, 2/15/09 $ 1,340,243
Aaa AAA 2,000 City of Waterbury, Tax
Revenue Bonds (FGIC),
5.375%, 4/15/08 1,984,380
Aaa AAA 740 Town of Stratford, (MBIA),
6.60%, 3/01/11 800,924
Aaa AAA 1,000 City of New Britain,
(MBIA), 6.00%, 3/01/12 1,026,430
Aaa AAA 1,000 Town of Plainfield,
(MBIA), 6.375%, 8/01/11 1,045,430
Aaa AAA 2,120 Puerto Rico Public
Improvement Bonds (MBIA),
5.25%, 7/01/18 1,955,446
------------
$ 8,152,853
------------
INSURED HEALTHCARE - 1.3%
A1 AA- $1,735 Connecticut HEFA, NHP (St.
Joseph's Living Center),
(AMBAC), 5.10%, 11/01/19 $ 1,528,604
A1 AA- 1,030 Connecticut HEFA, NHP (St.
Joseph's Learning Center)
(AMBAC), 5.00%, 11/01/09 951,699
------------
$ 2,480,303
------------
INSURED HOSPITAL - 10.0%
Aaa AAA $1,000 Connecticut HEFA,
Bridgeport Hospital
(MBIA), 6.625%, 7/01/18 $ 1,051,740
Aaa AAA 6,750 Connecticut HEFA, St.
Francis Hospital (FGIC),
5.00%, 7/01/23 5,808,172
Aaa AAA 1,500 Connecticut HEFA, Lawrence
and Memorial Hospital
(MBIA), 5.00%, 7/01/13 1,345,740
Aaa AAA 5,750 Connecticut HEFA, Lawrence
and Memorial Hospital
(MBIA), 5.00%, 7/01/22 4,959,203
Aaa AAA 1,000 Connecticut HEFA, Hospital
of St. Raphael (AMBAC),
6.50%, 7/01/11 1,080,700
Aaa AAA 1,500 Connecticut HEFA, Hospital
of St. Raphael (AMBAC),
6.625%, 7/01/14 1,575,585
</TABLE>
39
<PAGE> 9
<TABLE>
- --------------------------------------------------------------------------------
CONNECTICUT TAX FREE PORTFOLIO (CONTINUED)
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS (CONTINUED)
- --------------------------------------------------------------------------------
<CAPTION>
RATINGS
(UNAUDITED)
- ----------------- PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
INSURED HOSPITAL - (CONTINUED)
Aaa AAA 2,000 Connecticut HEFA, Yale-New
Haven Hospital (MBIA),
6.50%, 7/01/12 2,093,380
Aaa AAA 1,200 Connecticut HEFA, Yale-New
Haven Hospital (MBIA),
7.10%, 7/01/25 1,297,800
------------
$ 19,212,320
------------
INSURED SOLID WASTE - 0.7%
Aaa AAA $1,275 Connecticut Resources
Recovery Authority Mid-
Connecticut System Bonds
(MBIA), 7.30%, 10/15/12 $ 1,343,161
------------
INSURED SPECIAL TAX - 0.7%
State of Connecticut
Special Tax Obligation
Bonds (FGIC), 5.00%,
10/01/13 $ 1,342,950
AAA $1,500
------------
INSURED WATER AND SEWER - 3.3%
Aaa AAA $1,750 Connecticut Development
Authority Water Facilities
Bonds, Connecticut Water
Company (AMBAC), (AMT),
5.875%, 9/01/22 $ 1,689,048
Aaa AAA 1,150 Connecticut Development
Authority Water Facilities
Bonds, Connecticut Water
Company (AMBAC), (AMT),
5.75%, 7/01/28 1,086,853
Aaa AAA 3,460 South Central Connecticut,
Regional Water Authority
Bonds (FGIC), 5.75%,
8/01/12 3,445,122
------------
$ 6,221,023
------------
SOLID WASTE - 8.1%
A NR $2,500 Bristol Resource Recovery
Facility Operating
Committee, (Ogden Martin
Systems), 6.50%, 7/01/14 $ 2,570,800
A2 A+ 1,000 Connecticut Resources
Recovery Authority
(American REF-FUEL
Company), (AMT), 8.10%,
11/15/15 1,104,660
A2 A+ 450 Connecticut Resources
Recovery Authority
(American REF-FUEL
Company), (AMT), 8.00%,
11/15/15 495,760
A2 A+ 4,250 Connecticut Resources
Recovery Authority
(American REF-FUEL
Company), (AMT), 6.45%,
11/15/22 4,252,805
<CAPTION>
RATINGS
(UNAUDITED)
- ----------------- PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
NR A 7,970 Eastern Connecticut
Resource Recovery
Authority, (Wheelabrator
Lisbon), 5.50%, 1/01/20 7,000,609
------------
$ 15,424,634
------------
SPECIAL TAX - 2.7%
A1 AA- $1,000 State of Connecticut STOB,
4.40%, 10/01/04 $ 948,510
A1 AA- 1,000 State of Connecticut STOB,
5.40%, 9/01/10 968,880
A1 AA- 3,180 State of Connecticut STOB,
6.125%, 9/01/12 3,273,460
------------
Aaa $ 5,190,850
------------
STUDENT LOANS - 1.4%
A1 NR $ 455 Connecticut Higher
Education Supplemental
Loan Authority Revenue
Bonds (CHESLA) (AMT),
7.375%, 11/15/05 $ 477,313
A1 NR 1,350 CHESLA Revenue Bonds
(AMT), 6.20%, 11/15/09 1,355,279
A1 NR 910 CHESLA Revenue Bonds
(AMT), 7.50%, 11/15/10 960,141
------------
$ 2,792,733
------------
TRANSPORTATION - 2.4%
Baa1 A $4,465 Puerto Rico Highway and
Transportation Authority
Bonds, 5.50%, 7/01/15 $ 4,172,900
Baa1 A 500 Puerto Rico Highway and
Transportation Authority
Bonds, 5.50%, 7/01/15 467,290
------------
$ 4,640,190
------------
UTILITY - 4.3%
NR BBB $1,100 Guam Power Authority
Revenue Bonds, 6.625%,
10/01/14 $ 1,115,015
NR BBB 3,625 Guam Power Authority
Revenue Bonds, 6.30%,
10/01/22 3,532,671
NR NR 3,500 Virgin Islands Water and
Power Authority, Electric
Revenue System Bonds,
7.40%, 7/01/11 3,646,055
------------
$ 8,293,741
------------
WATER & SEWER REVENUE - 2.2%
Aa AA $1,250 State of Connecticut Clean
Water Fund Revenue Bonds,
6.00%, 10/01/12 $ 1,286,438
Aa AA 1,000 State of Connecticut Clean
Water Fund Revenue Bonds,
5.80%, 6/01/16 996,310
</TABLE>
40
<PAGE> 10
<TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS (CONTINUED)
- --------------------------------------------------------------------------------
<CAPTION>
RATINGS
(UNAUDITED)
- ----------------- PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
WATER & SEWER REVENUE - (CONTINUED)
NR A+ 2,225 Connecticut Development
Authority Water Facilities
(Stamford Water Company),
5.30%, 9/01/28 2,010,243
------------
$ 4,292,991
------------
TOTAL TAX-EXEMPT
INVESTMENTS (IDENTIFIED
COST, $192,808,845) $191,254,509
============
<FN>
(1) Security has been segregated to cover margin requirements for open financial
futures contracts.
</TABLE>
The Portfolio primarily invests in debt securities issued by Connecticut
municipalities. The ability of the issuers of the debt securities to meet their
obligations may be affected by economic developments in a specific industry or
municipality. In order to reduce the risk associated with such economic
developments, at July 31, 1995, 30.4% of the securities in the portfolio of
investments are backed by bond insurance of various financial institutions and
financial guaranty assurance agencies. The aggregate percentage by financial
institution ranged from 0.6% to 14.2% of total investments.
See notes to financial statements
41
<PAGE> 11
<TABLE>
- --------------------------------------------------------------------------------
Michigan Tax Free Portfolio
Portfolio of Investments - July 31, 1995
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS - 100%
- --------------------------------------------------------------------------------
<CAPTION>
RATINGS
(UNAUDITED)
- ----------------- PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
EDUCATION - 1.1%
NR BBB- $2,000 Puerto Rico Polytechnic
University, 6.50%, 8/01/24 $ 1,999,980
------------
ELECTRIC UTILITIES - 2.6%
NR BBB $1,000 Guam Power Authority,
6.625%, 10/01/14 $ 1,013,650
Baa1 BBB+ 500 Michigan South Central
Power Agency Supply
System, 6.75%, 11/01/10 517,475
Baa1 BBB 1,790 Monroe County, Michigan
PCR Detroit Edison
Project, 7.75%, 12/01/19 1,946,320
Baa1 A- 1,000 Puerto Rico Electric Power
Authority, 5.00%, 7/01/12 885,850
Baa1 A- 365 Puerto Rico Electric Power
Authority, 7.125%, 7/01/14 395,788
------------
$ 4,759,083
------------
ESCROWED - 6.2%
NR AA $ 940 Detroit City School
District, Michigan School
Building and Site, 7.15%,
5/01/11 $ 1,074,185
Aaa AAA 1,000 Lake Orion, Michigan
School District U.T.G.O.,
7.00%, (AMBAC) 5/01/20 1,171,550
Aaa AAA 750 Michigan HFA, Oakwood
Hospital (FGIC), 7.20%,
11/01/15 855,308
Aaa AAA 3,500 Monroe County, Michigan
EDC Mercy Memorial
Hospital (MBIA), 7.00%,
9/01/21 4,003,930
NR AA 955 Okemos Public Schools,
Michigan School Building
and Site, 6.90%, 5/01/11 1,079,398
Baa1 AAA 635 Puerto Rico Electric Power
Authority, 7.125%, 7/01/14 710,635
NR NR 2,400 Wyandotte School District,
Michigan School Building
and Site, 6.90%, 5/01/16 2,712,624
------------
$ 11,607,630
------------
GENERAL OBLIGATIONS - 5.2%
Aa AA $ 500 Avondale School District,
Michigan School Building
and Site, 6.75%, 5/01/14 $ 524,220
Aa AA 2,550 Clintondale Community
Schools, Michigan 6.75%,
5/01/24 2,686,093
Ba1 BBB 500 Detroit City, Michigan,
8.00%, 4/01/11 543,185
Ba1 BBB 2,925 Detroit City, Michigan,
6.35%, 4/01/14 2,877,615
A AA 500 East Lancing Building
Authority, Michigan,
7.00%, 10/01/16 527,070
Aa AA 1,350 Martin Public Schools,
Michigan School Building
and Site, 6.60%, 5/01/20 1,400,450
<CAPTION>
RATINGS
(UNAUDITED)
- ----------------- PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
Aa AA 1,000 Mattawan Consolidated
Schools, Michigan, 6.40%,
5/01/09 1,044,760
------------
$ 9,603,393
------------
HOSPITAL - 12.9%
A A $ 450 Michigan HFA Detroit
Medical Center Obligated
Group, 7.50%, 8/15/11 $ 487,651
A A 4,550 Michigan HFA Detroit
Medical Center Obligated
Group, 5.50%, 8/15/23 3,898,941
A A 5,500 Michigan HFA Detroit
Medical Center Obligated
Group, 6.25%, 8/15/13 5,309,810
A A 1,000 Michigan HFA Detroit
Medical Center Obligated
Group, 6.50%, 8/15/18 978,950
Aa AA 250 Michigan HFA Henry Ford
Continuing Care
Corporation, 6.75%,
7/01/11 264,555
A1 NR 2,970 Michigan HFA McLaren
Obligated Group, 5.375%,
10/15/13 2,659,843
A1 NR 6,000 Michigan HFA McLaren
Obligated Group, 4.50%,
10/15/21 4,456,559
A A 4,130 Michigan HFA MidMichigan
Obligated Group, 6.625%,
6/01/10 4,215,574
Aa AA 1,750 Royal Oak, Michigan
William Beaumont Hospital,
6.75%, 1/01/20 1,815,818
------------
$ 24,087,701
------------
HOUSING - 1.9%
NR A+ $1,500 Michigan HDA Rental
Housing (AMT), 7.15%,
4/01/10 $ 1,587,150
NR A+ 1,000 Michigan HDA Rental
Housing, 7.10%, 4/01/21 1,038,320
NR AA+ 895 Michigan HDA Single Family
Mortgage, 6.95%, 12/01/20 920,472
------------
$ 3,545,942
------------
INDUSTRIAL DEVELOPMENT REVENUE/
POLLUTION CONTROL REVENUE - 6.1%
Baa1 BBB $3,970 Dickinson, MI PCR-Champion
International, 5.85%,
10/01/18 $ 3,753,436
Baa1 BBB 3,000 Michigan Job Development
Authority PCR-General
Motors, 5.55%, 10/01/09
(1) 2,877,750
A3 BBB+ 3,750 Michigan Strategic Fund-
General Motors, 6.20%,
9/01/20 3,702,788
NR BBB+ 500 Michigan Strategic
Fund-KMart Corporation,
6.80%, 6/15/07 513,520
</TABLE>
42
<PAGE> 12
<TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS (CONTINUED)
- --------------------------------------------------------------------------------
<CAPTION>
RATINGS
(UNAUDITED)
- ----------------- PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
INDUSTRIAL DEVELOPMENT REVENUE/
POLLUTION CONTROL REVENUE - (CONTINUED)
NR BBB 530 Richmond, Michigan EDC
KMart Corporation, 6.625%,
1/01/07 541,305
------------
$ 11,388,799
------------
INSURED EDUCATION - 2.6%
Aaa AAA $ 500 Michigan Higher Education
Student Loan (AMBAC),
6.875%, 10/01/07 $ 525,110
Aaa AAA 2,000 Northern Michigan
University, Michigan
General Revenue (AMBAC),
6.55%, 12/01/14 2,093,840
Aaa AAA 1,250 Oakland University,
Michigan General Revenue
(MBIA), 5.75%, 5/15/26 1,194,425
Aaa AAA 500 University of Puerto Rico
(MBIA), 5.25%, 6/01/25 456,545
Aaa AAA 500 Western Michigan
University (AMBAC), 6.50%,
7/15/21 517,195
------------
$ 4,787,115
------------
INSURED ELECTRIC UTILITIES - 6.3%
Aaa AAA $1,510 Grand Haven City, Michigan
Electric System (MBIA),
5.25%, 7/01/13 $ 1,380,442
Aaa AAA 300 Michigan Strategic Fund,
Detroit Edison Company
(FGIC), 6.95%, 5/01/11 335,595
Aaa AAA 4,000 Michigan Strategic Fund,
Detroit Edison Company
(FGIC), 6.95%, 9/01/21 4,272,040
Aaa AAA 550 Monroe County, Michigan
PCR Detroit Edison Company
(FGIC) (AMT), 7.65%,
9/01/20 607,508
Aaa AAA 5,000 Monroe County, Michigan
PCR Detroit Edison Company
(MBIA) (AMT), 6.55%,
9/01/24 5,133,100
------------
$ 11,728,685
------------
INSURED GENERAL - 2.1%
Aaa AAA $4,500 Livonia, Michigan School
District U.T.G.O. (FGIC),
5.125%, 5/01/22 $ 3,956,670
------------
INSURED GENERAL OBLIGATION - 12.8%
Aaa AAA $ 250 Byron Center, Michigan
Public Schools U.T.G.O.
(MBIA), 5.875%, 5/01/24 $ 243,050
Aaa AAA 1,000 Chelsea, Michigan School
District U.T.G.O. (FGIC),
5.875%, 5/01/25 (2) 969,170
Aaa AAA 1,500 Dearborn, Michigan School
District U.T.G.O. (MBIA),
5.00%, 5/01/10 1,373,655
<CAPTION>
RATINGS
(UNAUDITED)
- ----------------- PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
Aaa AAA 2,000 Grand Ledge, Michigan
School District U.T.G.O.
(MBIA), 7.875%, 5/01/11 2,344,760
Aaa AAA 1,000 Greenville, Michigan
Public Schools U.T.G.O.
(MBIA) 964,510
Aaa AAA 2,000 Holland City, Michigan
School District U.T.G.O.
(AMBAC), 5.25%, 7/01/13 530,180
Aaa AAA 5,020 Huron Valley, Michigan
School District U.T.G.O.
(FGIC), 5/01/20 1,108,014
Aaa AAA 2,000 Lowell Schools, Michigan
U.T.G.O. (FGIC), 5/01/16 569,260
Aaa AAA 2,000 Napoleon, Michigan School
District U.T.G.O. (FGIC)
5.50%, 5/01/20 1,861,980
Aaa AAA 1,000 Napoleon, Michigan School
District U.T.G.O. (FGIC)
5.50%, 5/01/24 920,280
Aaa AAA 2,610 Okemos, Michigan Public
Schools U.T.G.O. (MBIA),
5/01/16 745,860
Aaa AAA 500 Pellston, Michigan Public
Schools U.T.G.O. (MBIA),
6.625%, 5/01/12 529,325
Aaa AAA 2,000 Portage Lake, Michigan
Water & Sewer G.O.
(AMBAC), 6.20%, 10/01/20 2,032,240
Aaa AAA 4,000 Riverview Community School
District, Michigan
U.T.G.O. (AMBAC), 5.25%,
5/01/21 3,565,600
Aaa AAA 2,000 Riverview Community School
District, Michigan
U.T.G.O. (AMBAC), 5.25%,
5/01/14 1,823,940
Aaa AAA 1,400 Vicksburg Community
Schools, Michigan U.T.G.O.
(MBIA), 5/01/16 392,112
Aaa AAA 1,000 Vicksburg Community
Schools, Michigan U.T.G.O.
(MBIA), 5/01/17 263,410
Aaa AAA 2,500 Warren, Michigan School
District U.T.G.O. (MBIA),
5.50%, 5/01/14 2,370,950
Aaa AAA 1,390 Warren, Michigan School
District U.T.G.O. (MBIA),
5.25%, 5/01/21 1,252,362
------------
$ 23,860,658
------------
INSURED HEALTHCARE - 1.0%
Aaa AAA $2,000 Farmington Hills, Michigan
EDC-Botsford Continuing
Care (MBIA), 5.75%,
2/15/25 $ 1,907,260
------------
INSURED HOSPITAL - 12.4%
Aaa AAA $3,000 Dearborn City, Michigan
EDC Oakwood Obligated
Group (MBIA), 5.25%,
8/15/14 $ 2,711,940
</TABLE>
43
<PAGE> 13
<TABLE>
- --------------------------------------------------------------------------------
MICHIGAN TAX FREE PORTFOLIO (CONTINUED)
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS (CONTINUED)
- --------------------------------------------------------------------------------
<CAPTION>
RATINGS
(UNAUDITED)
- ----------------- PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
INSURED HOSPITAL - (CONTINUED)
Aaa AAA 1,000 Dearborn City, Michigan
EDC Oakwood Obligated
Group (MBIA), 5.25%,
8/15/21 882,690
Aaa AAA 3,500 Jackson County, Michigan
HFA W.A. Foote Memorial
(FGIC), 4.75%, 6/01/15 2,992,745
Aaa AAA 5,735 Kalamazoo City, Michigan
HFA Borgess Medical Center
(FGIC), 5.25%, 6/01/17 5,221,316
Aaa AAA 1,750 Kent City, Michigan HFA
Butterworth Hospital
(MBIA), 5.375%, 1/15/19 1,592,762
Aaa AAA 1,015 Michigan HFA Mercy
Memorial Hospital (MBIA),
5.25%, 6/01/13 936,429
Aaa AAA 2,715 Michigan HFA Mercy
Memorial Hospital (MBIA),
5.25%, 6/01/21 2,429,491
Aaa AAA 1,000 Michigan HFA Oakwood
Hospital Obligated Group
(FGIC), 5.625%, 11/01/18 954,410
Aaa AAA 1,500 Michigan HFA Sisters of
Mercy Health Corporation
(MBIA), 5.25%, 8/15/21 1,332,885
Aaa AAA 3,200 Michigan HFA Linked Bulls
& Bears (FSA), 6.10%,
8/15/22 3,221,504
Aaa AAA 1,000 St. Joseph City, Michigan
HFA Mercy Memorial Medical
Center (AMBAC), 5.25%,
1/01/16 910,150
------------
$ 23,186,322
------------
INSURED HOUSING - 1.7%
Aaa AAA $ 500 Michigan HDA Parkway
Meadows Projects (FSA),
6.85%, 10/15/18 $ 518,495
Aaa AAA 2,780 Michigan HDA Mercy
Bellbrook Project (MBIA),
5.375%, 4/01/10 2,617,036
------------
$ 3,135,531
------------
INSURED SPECIAL TAX - 0.2%
Aaa AAA $ 400 Grand Rapids, Michigan
Downtown Development
Authority Tax Increment
(MBIA), 6.875%, 6/01/24 $ 429,840
------------
INSURED TRANSPORTATION - 1.9%
Aaa AAA $1,000 Wayne County, Michigan
Airport (MBIA), 5.25%,
12/01/13 $ 921,380
Aaa AAA 1,000 Wayne County, Michigan
Airport (MBIA), 5.40%,
12/01/16 909,250
<CAPTION>
RATINGS
(UNAUDITED)
- ----------------- PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
Aaa AAA 2,000 Wayne County, Michigan
Airport (MBIA), 5.25%,
12/01/21 1,788,000
------------
$ 3,618,630
------------
INSURED WATER & SEWER - 7.5%
Aaa AAA $ 300 Clinton Township, Michigan
Water and Sewage System
(AMBAC), 4.75%, 7/01/09 $ 272,325
Aaa AAA 400 Clinton Township, Michigan
Water and Sewage System
(AMBAC), 4.75%, 7/01/10 359,544
Aaa AAA 400 Clinton Township, Michigan
Water and Sewage System
(AMBAC), 4.75%, 7/01/11 357,872
Aaa AAA 400 Clinton Township, Michigan
Water and Sewage System
(AMBAC), 4.75%, 7/01/12 356,288
Aaa AAA 4,425 Detroit City, Michigan
Water Supply System
(FGIC), 6.25%, 7/01/12 4,549,343
Aaa AAA 9,680 Detroit City, Michigan
Water Supply System
(FGIC), 4.75%, 7/01/19 8,078,250
------------
$ 13,973,622
------------
MISCELLANEOUS - 3.4%
A1 AA $ 590 Michigan Municipal Bond
Authority Local Government
Loan, 6.90%, 5/01/21 $ 648,404
A1 AA 2,550 Michigan Municipal Bond
Authority Local Government
Loan-Qualified School,
6.50%, 5/01/07 2,768,356
A1 AA 760 Michigan Municipal Bond
Authority Local Government
Loan, 6.50%, 5/01/08 822,685
NR A- 2,000 Michigan Strategic
Environmental Research
Institute, 6.375%, 8/15/12 2,041,880
------------
$ 6,281,325
------------
SOLID WASTE - 4.5%
NR BBB- $4,220 Greater Detroit, Michigan
Resource Recovery
Authority, 9.25%, 12/13/08 $ 4,391,712
NR BBB- 1,000 Greater Detroit, Michigan
Resource Recovery
Authority, 9.25%, 12/13/08 1,040,690
NR BBB- 1,915 Greater Detroit, Michigan
Resource Recovery
Authority, 9.25%, 12/13/08 1,992,921
NR BBB- 1,000 Greater Detroit, Michigan
Resource Recovery
Authority, 9.25%, 12/13/08 1,040,690
------------
$ 8,466,013
------------
</TABLE>
44
<PAGE> 14
<TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS (CONTINUED)
- --------------------------------------------------------------------------------
<CAPTION>
RATINGS
(UNAUDITED)
- ----------------- PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
SPECIAL TAX REVENUE - 5.6%
NR BBB+ $ 250 Battle Creek, Michigan
Downtown Development
Authority Tax Increment,
7.60%, 5/01/16 $ 272,698
NR BBB+ 1,315 Battle Creek, Michigan
Downtown Development
Authority Tax Increment,
7.65%, 5/01/22 1,438,742
NR A 7,650 Detroit City Convention
Facility, Michigan Cobo
Hall Expansion Project,
5.25%, 9/30/12 (3) 6,843,690
NR A 1,825 Michigan Muni Bond
Authority Local Government
Loan Project, 6.75%,
5/01/12 1,944,811
------------
$ 10,499,941
------------
TRANSPORTATION - 1.1%
Baa1 A $2,175 Puerto Rico Highway and
Transportation Authority,
5.50%, 7/01/19 $ 1,988,842
------------
WATER & SEWER - 0.9%
Aa AA $1,895 Lansing City, Michigan
Water and Electric Utility
System, 4.90%, 7/01/10 $ 1,713,914
------------
TOTAL TAX-EXEMPT
INVESTMENTS (IDENTIFIED
COST, $182,066,681) $186,526,896
============
<FN>
(1) Security has been segregated to cover margin requirements for open financial
futures contracts.
(2) When-issued security.
(3) Security has been segregated to cover when-issued securities.
</TABLE>
The Portfolio invests primarily in debt securities issued by Michigan
municipalities. The ability of the issuers of the debt securities to meet their
obligations may be affected by economic developments in a specific industry or
municipality. In order to reduce the risk associated with such economic
developments, at July 31, 1995, 51.8% of the securities in the portfolio of
investments are backed by bond insurance of various financial guaranty assurance
agencies. The aggregate percentage by financial institution ranges from 2.0% to
22.0% of total investments.
See notes to financial statements
45
<PAGE> 15
<TABLE>
- --------------------------------------------------------------------------------
Minnesota Tax Free Portfolio
Portfolio of Investments - July 31, 1995
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS - 100%
- --------------------------------------------------------------------------------
<CAPTION>
RATINGS
(UNAUDITED)
- ----------------- PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
EDUCATION - 3.2%
A NR $ 100 Minnesota Higher Education
Facilities Authority, St.
Olaf College, 6.25%,
4/01/10 $ 100,034
Baa NR 1,000 Minnesota Higher Education
Facilities Authority, St.
Mary's College, 6.15%,
10/01/23 968,720
A NR 1,500 Northfield Minnesota, St.
Olaf College, 6.40%,
10/01/21 1,543,785
-----------
$ 2,612,539
-----------
ESCROWED - 5.4%
Aa AA+ $1,700 State of Minnesota "RIBS",
Variable, 8/01/11 (1) $ 2,016,625
A1 AAA 400 Southern Minnesota
Municipal Power Agency,
7.00%, 1/01/16 413,272
Aaa AAA 1,840 Western Minnesota Municipal
Power Agency, 6.375%,
1/01/16 1,956,380
-----------
$ 4,386,277
-----------
GENERAL OBLIGATIONS - 11.2%
Aa NR $ 500 Brainerd, Independent
School District, 5.50%,
2/01/15 $ 476,455
Aaa AAA 700 City of Minneapolis, 6.25%,
4/01/12 727,902
Aaa AAA 1,000 City of Minneapolis, 5.20%,
3/01/23 943,830
Aa1 AA+ 2,000 State of Minnesota, 5.40%,
8/01/13 1,913,500
Aa1 AA+ 1,000 State of Minnesota, Duluth
Airport, 6.25%, 8/01/14 1,019,330
Aa1 AA+ 1,000 State of Minnesota, Duluth
Airport, 6.25%, 8/01/14 1,019,330
Aa AA 1,250 Regents of the University
of Minnesota, "INFLOS",
Variable, 8/15/03 (1) 1,181,412
A AA- 200 City of Saint Cloud,
"Inverse Floaters",
Variable, 8/01/13 (1) 205,000
Aa NR 1,595 White Bear Lake,
Independent School
District, 6.00%, 2/01/14 1,596,037
-----------
$ 9,082,796
-----------
HEALTHCARE (NON-HOSPITAL) - 5.7%
A A- $1,250 Minneapolis and St. Paul
Housing and Redevelopment
Authority, Group Health
Plan, Inc., 6.75%, 12/01/13 $ 1,298,000
A A- 250 Minneapolis and St. Paul
Housing and Redevelopment
Authority, Group Health
Plan, Inc., 6.90%, 10/15/22 262,768
NR NR 1,000 St. Paul Housing and
Redevelopment Authority,
Highland Park, 8.75%,
11/01/24 997,670
NR BBB+ 2,120 City of Red Wing, Minnesota
Health Care Facilities
Revenue, River Region
Obligated Group, 6.50%,
9/01/22 2,054,322
-----------
$ 4,612,760
-----------
<CAPTION>
RATINGS
(UNAUDITED)
- ----------------- PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
HOSPITALS - 6.9%
NR AA+ $1,400 City of Rochester,
Minnesota Health Care
Facilities (MHCF) Mayo
Foundation/Medical Center,
6.026%, 11/15/15 $ 1,374,142
NR AA+ 500 City of Rochester, MHCF
Mayo Foundation/Medical
Center, "Inverse Floaters",
Variable 11/15/15 (1) 500,000
NR AA+ 1,700 City of Rochester, MHCF
Mayo Foundation/Medical
Center, 5.75%, 11/15/21 1,668,193
Baa BBB- 1,000 St. Paul Housing and
Redevelopment Authority,
Healtheast Project, 6.625%,
11/01/17 969,920
A A+ 1,000 St. Paul Housing and
Redevelopment Authority,
Childrens Hospital, 7.00%,
12/01/19 1,080,420
-----------
$ 5,592,675
-----------
HOUSING - 13.6%
NR AAA $ 300 City of Coon Rapids, Multi-
Family Housing (MFH) Browns
Meadow Manor, (FHA), (AMT),
6.85%, 7/01/33 $ 300,570
NR AAA 1,395 County of Dakota, Housing
and Redevelopment
Authority, (GNMA), 7.375%,
12/01/29 (2) 1,473,259
Aa NR 1,200 City of Maplewood MFH,
Beaver Creek Apartments,
(FHA), 6.50%, 9/01/24 1,182,960
NR AAA 90 Minneapolis and St. Paul
Housing Finance Board,
(GNMA), (AMT), 7.30%,
8/01/31 94,035
Aa AA 420 Minnesota Housing Finance
Agency, Single-Family
Mortgage, (SFM), 7.70%,
7/01/14 450,114
Aa AA 380 Minnesota Housing Finance
Agency, SFM, 7.05%, 7/01/22 390,085
Aa AA 1,095 Minnesota Housing Finance
Agency, SFM, (AMT), 5.80%,
7/01/25 1,007,860
Aa AA+ 465 Minnesota Housing Finance
Agency, SFM, 6.95%, 7/01/16 481,094
Aa AA+ 1,000 Minnesota Housing Finance
Agency, SFM, (AMT), 6.75%,
7/01/12 1,019,330
Aa AA+ 1,235 Minnesota Housing Finance
Agency, SFM, (AMT), 6.85%,
1/01/24 1,254,612
Aa AA+ 1,700 Minnesota Housing Finance
Agency, SFM, (AMT), 6.50%,
1/01/26 1,686,502
</TABLE>
46
<PAGE> 16
<TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS (CONTINUED)
- --------------------------------------------------------------------------------
<CAPTION>
RATINGS
(UNAUDITED)
- ----------------- PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
HOUSING - (CONTINUED)
Aa AA+ 710 Minnesota Housing Finance
Agency, SFM, (AMT), 6.75%,
1/01/26 714,352
Aa AA+ 430 Minnesota Housing Finance
Agency, SFM, (AMT), 6.15%,
1/01/26 410,121
NR AAA 230 St. Paul, Minnesota Housing
and Redevelopment
Authority, (FNMA), 6.95%,
12/01/31 236,845
NR AAA 360 St. Paul, Minnesota Housing
and Redevelopment
Authority, (FNMA), 6.90%,
12/01/21 370,735
-----------
$11,072,474
-----------
INDUSTRIAL DEVELOPMENT/POLLUTION
CONTROL - 8.8%
NR AA- $ 300 City of Minneapolis,
Minnesota Community
Development Agency, 6.40%,
12/01/04 $ 315,618
NR BBB+ 100 City of Minneapolis,
Minnesota Community
Development Agency, 7.35%,
12/01/09 104,342
NR BBB+ 1,605 City of Minneapolis,
Minnesota Community
Development Agency, 6.80%,
12/01/24 1,574,810
Aa3 AA- 3,000 Seaway Port Authority of
Duluth, Cargill, Inc.,
6.80%, 5/01/12 3,203,130
Aa3 NR 2,000 Seaway Port Authority of
Duluth, Cargill, Inc.,
5.75%, 12/01/16 1,961,300
-----------
$ 7,159,200
-----------
INSURED GENERAL OBLIGATION - 3.6%
Aaa AAA $ 500 Cass Lake, Independent
School District, (AMBAC),
6.625%, 2/01/12 $ 537,370
Aaa AAA 1,000 Roseville, Independent
School District, (FGIC),
6.00%, 2/01/23 998,650
Aaa AAA 1,330 St. Francis, Independent
School District No. 15,
(CGIC), 6.35%, 2/01/12 1,391,153
-----------
$ 2,927,173
-----------
INSURED HOSPITAL - 19.7%
Aaa AAA $ 750 Duluth Economic Development
Authority, The Duluth
Clinic, (AMBAC), 6.20%,
11/01/12 $ 771,690
Aaa AAA 100 Minneapolis and St. Paul
Health Care Systems, Health
One Obligated Group,
(MBIA), 7.40%, 8/15/11 108,990
Aaa AAA 5,845 Minneapolis and St. Paul
Health Care Systems,
Healthspan, (AMBAC), 4.75%,
11/15/18 4,895,655
Aaa AAA 250 City of Minneapolis,
Hospital Revenue, Fairview
Hospital and Healthcare,
(MBIA), 6.50%, 1/01/11 262,517
<CAPTION>
RATINGS
(UNAUDITED)
- ----------------- PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
Aaa AAA 750 Plymouth, Health
Facilities, Westhealth
Project (CGIC), 6.25%,
6/01/16 768,293
Aaa AAA 1,000 City of Saint Cloud,
Hospital Facilities, The
Saint Cloud Hospital,
(AMBAC), 6.75%, 7/01/15 1,063,430
Aaa AAA 3,650 City of St. Louis Park,
Health Care Facilities
Health System Minnesota
Obligated Group, (AMBAC),
5.20%, 7/01/23 3,234,119
Aaa AAA 5,150 St. Paul Housing and
Redevelopment Authority,
St. Paul-Ramsey Medical
Center Project, (AMBAC),
5.55%, 5/15/23 4,891,213
-----------
$15,995,907
-----------
INSURED HOUSING - 1.9%
Aaa AAA $1,500 SCA Tax Exempt Trust,
Burnsville, Minnesota
Multi-Family Housing,
(FSA), 7.10%, 1/01/30 $ 1,538,775
-----------
INSURED SPECIAL TAX - 3.5%
Aaa AAA $3,000 St. Paul Housing and
Redevelopment Authority,
Civic Center Project,
(MBIA), 5.45%, 11/01/13 $ 2,840,460
-----------
INSURED UTILITIES - 3.9%
Aaa AAA $ 300 Northern Municipal Power
Agency, (AMBAC), 6.00%,
1/01/19 $ 300,528
Aaa AAA 750 Southern Minnesota
Municipal Power Agency,
(MBIA), 5.00%, 1/01/12 688,477
Aaa AAA 300 Southern Minnesota
Municipal Power Agency,
"Yield Curve Notes",
(MBIA), Variable, 1/01/18
(1) 283,512
Aaa AAA 6,950 Southern Minnesota
Municipal Power Agency,
(MBIA), 0%, 10/01/21 1,494,737
Aaa AAA 510 Western Minnesota Municipal
Power Agency, (MBIA),
5.50%, 1/01/15 489,416
-----------
$ 3,256,670
-----------
LEASE/CERTIFICATE OF
PARTICIPATION - 2.7%
Baa1 NR $ 350 City of Cambridge, Economic
Development Authority,
6.25%, 2/01/14 $ 347,722
</TABLE>
47
<PAGE> 17
<TABLE>
- --------------------------------------------------------------------------------
MINNESOTA TAX FREE PORTFOLIO (CONTINUED)
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS (CONTINUED)
- --------------------------------------------------------------------------------
<CAPTION>
RATINGS
(UNAUDITED)
- ----------------- PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
LEASE/CERTIFICATE OF PARTICIPATION -
(CONTINUED)
Aa AA 1,770 Hennepin County, Lease
Revenue Certificates of
Participation, 6.80%,
5/01/17(2) 1,856,199
-----------
$ 2,203,921
-----------
MISCELLANEOUS - 0.9%
A A $ 750 Metropolitan Council,
Minneapolis-St. Paul
Metropolitan Area Sports
Facilities, Hubert H.
Humphrey Metrodome, 6.00%,
10/01/09 $ 757,815
-----------
TRANSPORTATION - 0.6%
Aaa AAA $ 200 Minneapolis and St. Paul,
Minnesota Metropolitan
Airports Commission, (AMT),
6.60%, 1/01/09 $ 211,186
Aaa AAA 300 Minneapolis and St. Paul,
Minnesota Metropolitan
Airports Commission, (AMT),
6.60%, 1/01/10 316,779
-----------
$ 527,965
-----------
UTILITY - 5.1%
Aa3 A- $1,200 Bass Brook, Pollution
Control Revenue, Minnesota
Power & Light Company,
6.00%, 7/01/22 $ 1,173,300
A A 1,500 Northern Municipal Power
Agency, Minnesota Electric,
7.25%, 1/01/16 1,624,965
A1 A+ 1,000 Southern Minnesota
Municipal Power Agency,
5.00%, 1/01/12 902,250
A A 450 Western Minnesota Municipal
Power Agency, 7.00%,
1/01/13 468,599
-----------
$ 4,169,114
-----------
<CAPTION>
RATINGS
(UNAUDITED)
- ----------------- PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
WATER AND SEWER - 3.3%
Aa3 A $ 450 Anoka County, Minnesota
Solid Waste Disposal
Revenue Natural Rural
Utilities, 6.95%, 12/01/08 $ 483,421
Aa AAA 100 Minnesota Public Facilities
Authority Water Pollution
Control, 7.00%, 3/01/09 107,398
Aa AAA 150 Minnesota Public Facilities
Authority Water Pollution
Control, 6.70%, 3/01/13 160,380
Aa AAA 1,835 Minnesota Public Facilities
Authority Water Pollution
Control, 6.50%, 3/01/14 1,933,393
-----------
$ 2,684,592
-----------
TOTAL TAX-EXEMPT
INVESTMENTS (IDENTIFIED
COST, $78,851,048) $81,421,113
===========
<FN>
(1) The above designated securities have been issued as inverse floater bonds.
(2) Security has been segregated to cover margin requirements for open financial
futures contracts.
</TABLE>
The Portfolio primarily invests in debt securities issued by Minnesota
municipalities. The ability of the issuers of the debt securities to meet their
obligations may be affected by economic developments in a specific industry or
municipality. In order to reduce the risk associated with such economic
developments, at July 31, 1995, 34.7% of the securities in the portfolio of
investments are backed by bond insurance of various financial institutions and
financial guaranty assurance agencies. The aggregate percentage by financial
institution ranged from 0.4% to 19.3% of total investments.
See notes to financial statements
48
<PAGE> 18
<TABLE>
- --------------------------------------------------------------------------------
New Jersey Tax Free Portfolio
Portfolio of Investments - July 31, 1995
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS - 100%
- --------------------------------------------------------------------------------
<CAPTION>
RATINGS
(UNAUDITED)
- ----------------- PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
COGENERATION - 5.0%
NR NR $15,750 New Jersey Economic
Development Authority,
Vineland Cogeneration
Limited Partnership,
(AMT), 7.875%, 6/01/19 $ 16,904,475
NR BB+ 3,370 New Jersey Economic
Development Authority,
Trigen-Trenton Project,
(AMT), 6.10%, 12/01/04 3,346,039
------------
$ 20,250,514
------------
EDUCATION - 3.5%
Baa1 BBB $ 2,480 New Jersey Educational
Facilities Authority,
Seton Hall University,
7.00%, 7/01/21 $ 2,618,235
Aa1 AA+ 1,000 New Jersey Educational
Facilities Authority,
Princeton Theological
Seminary, 6.375%, 7/01/22 1,034,580
NR NR 8,800 New Jersey State Higher
Education Assistance
Authority, (AMT), 0%,
7/01/20 3,042,952
NR BBB- 1,760 Puerto Rico Industrial,
Tourist, Educational,
Medical and Environmental
Authority, Polytechnic
University, 5.70%, 8/01/13 1,620,626
NR BBB- 1,310 Puerto Rico Industrial,
Tourist, Educational,
Medical and Environmental
Authority, Polytechnic
University, 5.50%, 8/01/24 1,139,988
NR BBB- 1,000 Puerto Rico Industrial,
Tourist, Educational,
Medical and Environmental
Authority, Polytechnic
University, 6.50%, 8/01/24 999,990
A1 AA 2,500 Rutgers, The State
University of New Jersey,
6.85%, 5/01/21 2,658,400
A AA 1,000 University of Medicine and
Dentistry of New Jersey,
7.20%, 12/01/19 1,089,280
------------
$ 14,204,051
------------
ESCROWED - 0.8%
Aaa AAA $ 870 The City of Newark, New
Jersey (AMBAC), 7.375%,
10/01/07 $ 985,440
NR NR 2,000 County of Passaic, New
Jersey, 6.70%, 9/01/13 2,207,360
------------
$ 3,192,800
------------
GENERAL OBLIGATIONS - 13.3%
NR BBB $ 9,745 Government of Guam, 5.40%,
11/15/18 $ 8,414,515
NR A+ 5,000 The Hudson County
Improvement Authority,
6.625%, 8/01/25 5,235,950
<CAPTION>
RATINGS
(UNAUDITED)
- ----------------- PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
Aa1 NR 3,000 Mercer County Improvement
Authority Solid Waste, 0%,
4/01/10 1,299,240
Baa1 A 1,990 Commonwealth of Puerto
Rico, 6.45%, 7/01/17 2,083,530
Baa1 A 5,000 Commonwealth of Puerto
Rico, 6.50%, 7/01/23 5,234,400
Baa BBB 5,645 The Commonwealth of Puerto
Rico Aqueduct and Sewer
Authority, 7.875%, 7/01/17 6,253,305
Baa1 A 3,250 Puerto Rico Public
Buildings Authority,
Public Education and
Health Facilities, 5.75%,
7/01/15 3,119,675
Baa1 A 5,125 Puerto Rico Public
Buildings Authority,
Public Education and
Health Facilities, 5.50%,
7/01/21 4,695,730
Baa1 A 2,075 Puerto Rico Public
Buildings Authority,
Public Education and
Health Facilities, 5.75%,
7/01/16 1,977,932
NR NR 14,850 Virgin Islands Public
Finance Authority, 7.25%,
10/01/18 15,318,517
------------
$ 53,632,794
------------
HEALTHCARE (NON-HOSPITAL) - 3.0%
NR BBB $ 615 New Jersey Economic
Development Authority
Cadbury Corporation,
7.50%, 7/01/21 $ 593,875
NR BBB 300 New Jersey Economic
Development Authority
Cadbury Corporation,
8.70%, 7/01/07 319,896
NR NR 1,400 New Jersey Economic
Development Authority,
Claremont Health System,
9.10%, 9/01/22 1,465,632
NR NR 2,500 New Jersey Economic
Development Authority,
Victoria Health
Corporation, 7.65%,
1/01/14 2,372,700
NR NR 4,000 New Jersey Economic
Development Authority,
Keswick Pines Project,
8.75%, 1/01/24 3,991,120
NR NR 3,630 New Jersey Economic
Development Authority,
Forsgate Project, 8.625%,
6/01/25 3,410,857
------------
$ 12,154,080
------------
HOSPITALS - 6.6%
Aa AAA $10,790 New Jersey Health Care
Facilities Financing
Authority, Barnert
Hospital, (FHA), 6.80%,
8/01/19 $ 11,298,209
</TABLE>
49
<PAGE> 19
<TABLE>
- --------------------------------------------------------------------------------
NEW JERSEY TAX FREE PORTFOLIO (CONTINUED)
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS (CONTINUED)
- --------------------------------------------------------------------------------
<CAPTION>
RATINGS
(UNAUDITED)
- ----------------- PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
HOSPITALS - (CONTINUED)
A A- 2,300 New Jersey Health Care
Facilities Financing
Authority, Atlantic City
Medical Center, 6.80%,
7/01/11 2,417,300
Baa1 NR 3,100 New Jersey Health Care
Facilities Financing
Authority, Deborah Heart
and Lung Center, 6.30%,
7/01/23 3,047,796
Baa NR 2,000 New Jersey Health Care
Facilities Financing
Authority, Southern Ocean
County Hospital, 6.25%,
7/01/23 1,842,100
A A- 9,650 New Jersey Health Care
Facilities Financing
Authority, Chilton
Memorial Hospital, 5.00%,
7/01/13 8,175,866
------------
$ 26,781,271
------------
HOUSING - 4.4%
Aa AA $ 1,250 New Jersey Building
Authority, 7.20%, 6/15/13 $ 1,357,438
Aa AA- 2,591 New Jersey Building
Authority, Garden State
Savings, 0%, 6/15/10 1,105,813
NR AAA 3,700 New Jersey Housing and
Mortgage Finance Agency,
Presidential Plaza, (FHA),
7.00%, 5/01/30 3,832,793
NR AAA 2,000 New Jersey Housing and
Mortgage Finance Agency,
Presidential Plaza, (FHA),
6.95%, 5/01/13 2,084,940
NR AA+ 1,000 New Jersey Housing and
Mortgage Finance Agency,
Section 8, 7.10%, 11/01/12 1,040,920
NR AA+ 1,975 New Jersey Housing and
Mortgage Finance Agency,
Section 8, 7.10%, 11/01/11 2,055,817
NR AA+ 1,250 New Jersey Housing and
Mortgage Finance Agency,
Rental Housing, (AMT),
7.25%, 11/01/22 1,287,025
NR A+ 1,000 New Jersey Housing and
Mortgage Finance Agency,
Rental Housing, (AMT),
7.10%, 5/01/22 1,029,330
NR A+ 3,715 New Jersey Housing and
Mortgage Finance Agency,
6.60%, 11/01/14 3,773,511
Aaa AAA 300 Puerto Rico Housing
Finance Corporation
Mortgage Revenue (GNMA),
6.85%, 10/15/23 310,209
------------
$ 17,877,796
------------
<CAPTION>
RATINGS
(UNAUDITED)
- ----------------- PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
INDUSTRIAL DEVELOPMENT/POLLUTION
CONTROL - 5.0%
NR NR $ 2,000 Middlesex County Pollution
Control Financing
Authority, Amerada Hess
Corporation, 7.875%,
6/01/22 $ 2,238,020
NR NR 4,000 Middlesex County Pollution
Control Financing
Authority, Amerada Hess
Corporation, 6.875%,
12/01/22 4,168,480
Aa1 NR 3,000 New Jersey Economic
Development Authority,
Garden State Paper
Company, (AMT), 7.125%,
4/01/22 3,124,320
NR NR 2,000 New Jersey Economic
Development Authority, The
Seeing Eye, Inc., 7.30%,
4/01/11 2,123,560
NR BBB 1,160 New Jersey Economic
Development Authority,
National Association of
Accountants, Inc., 7.65%,
7/01/09 1,241,583
NR AA- 3,300 New Jersey Economic
Development Authority, Oak
Grove Associates, 6.125%,
12/01/06 3,401,937
Baa1 A- 2,135 New Jersey Economic
Development Authority,
GATX Terminals
Corporation, 7.30%,
9/01/19 2,349,098
Aa3 AA- 1,300 Puerto Rico Industrial,
Medical and Environmental
Pollution Control
Authority, Motorola, Inc.,
6.75%, 1/01/14 1,375,712
------------
$ 20,022,710
------------
INSURED EDUCATION - 0.5%
Aaa AAA $ 2,000 New Jersey State
Educational Facilities
Authority, Seton Hall
University, (BIGI), 6.85%,
7/01/19 $ 2,106,540
------------
INSURED HOSPITALS - 1.4%
Aaa AAA $ 1,310 New Jersey Health Care
Facilities Financing
Authority, Hackensack
Medical Center, (FGIC),
6.625%, 7/01/17 $ 1,372,631
Aaa AAA 2,000 New Jersey Health Care
Facilities Financing
Authority, Hackensack
Medical Center, (FGIC),
6.25%, 7/01/21 2,033,380
Aa AA- 480 New Jersey Health Care
Facilities Financing
Authority, Cathedral
Health Services (MBIA),
7.25%, 2/15/10 522,144
</TABLE>
50
<PAGE> 20
<TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS (CONTINUED)
- --------------------------------------------------------------------------------
<CAPTION>
RATINGS
(UNAUDITED)
- ----------------- PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
INSURED HOSPITALS - (CONTINUED)
Aa AA- 1,570 New Jersey Health Care
Facilities Financing
Authority, Cathedral
Health Services, (MBIA)
7.25%, 2/15/21 1,700,059
------------
$ 5,628,214
------------
INSURED HOUSING - 1.3%
Aaa AAA $ 1,410 New Jersey Housing and
Mortgage Finance Agency,
(MBIA), 7.375%, 10/01/17 $ 1,468,007
Aaa AAA 1,760 New Jersey Housing and
Mortgage Finance Agency,
(AMT), (MBIA), 7.70%,
10/01/29 1,847,402
Aaa AAA 1,745 Pennsauken Township
Housing Finance
Corporation, (MBIA),
8.00%, 4/01/11 1,836,665
------------
$ 5,152,074
------------
INSURED LEASE REVENUE - 5.8%
Aaa AAA $ 3,900 County of Atlantic, Public
Facilities Lease
Agreement, (FGIC), 6.00%,
3/01/13 $ 4,011,072
Aaa AAA 1,750 County of Hudson, New
Jersey Correctional
Facility, (MBIA), 6.50%,
12/01/11 1,842,925
Aaa AAA 6,240 County of Hudson, New
Jersey Correctional
Facility, (MBIA), 6.60%,
12/01/21 6,537,648
Aaa AAA 2,500 County of Hudson, New
Jersey Improvement
Authority, Secondary Yield
Curve Notes, (FGIC),
Variable, 12/01/25 (1) 2,507,900
Aaa AAA 1,800 County of Middlesex,
Certificates of
Participation, (MBIA),
6.125%, 2/15/19 1,835,622
Aaa AAA 5,000 New Jersey Builders
(AMBAC), 5%, 6/15/13 4,506,800
Aaa AAA 2,225 University of Medicine and
Dentistry Certificates of
Participation, (MBIA),
6.75%, 12/01/09 2,359,590
------------
$ 23,601,557
------------
INSURED SOLID WASTE - 0.5%
Aaa AAA $ 2,000 The Mercer County
Improvement Authority,
Solid Waste Revenue,
(AMT), (FGIC), 6.70%,
4/01/13 $ 2,118,200
------------
INSURED SPECIAL TAX - 0.8%
Aaa AAA $ 3,375 New Jersey Economic
Development Authority,
Market Transition
Facility, (MBIA), 5.875%,
7/01/11 $ 3,386,914
------------
INSURED TRANSPORTATION - 4.1%
Aaa AAA $ 2,000 The Delaware River and Bay
Authority, (MBIA), 4.75%,
1/01/24 $ 1,660,900
<CAPTION>
RATINGS
(UNAUDITED)
- ----------------- PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
Aaa AAA 5,000 New Jersey Turnpike
Authority "RITES", (MBIA),
Variable, 1/01/16 (1) 5,744,000
Aaa AAA 8,450 New Jersey Turnpike
Authority, (MBIA), 6.50%,
1/01/16 9,162,335
------------
$ 16,567,235
------------
INSURED UTILITIES - 3.9%
Aaa AAA $ 2,750 New Jersey Economic
Development Authority, New
Jersey American Water Co.,
(AMT), (FGIC), 6.875%,
11/01/34 $ 2,912,058
Aaa AAA 13,500 Salem County, Public
Service Electric and Gas,
(MBIA), 5.55%, 11/01/33 12,629,790
------------
$ 15,541,848
------------
INSURED WATER & SEWER - 5.0%
Aaa AAA $ 6,500 Landis New Jersey Sewerage
Authority, Linked "CARS"
(FGIC), 5.65%, 9/19/19 $ 6,248,970
Aaa AAA 2,500 Middlesex County Utilities
Authority, Sewer Revenue,
(MBIA), Variable, 8/15/10
(1) 2,645,425
Aaa AAA 2,000 Township of Monroe, New
Jersey Municipal Utilities
Authority, (MBIA), 5.50%,
2/01/17 1,882,380
Aaa AAA 1,250 New Jersey Economic
Development Authority,
Middlesex Water Company,
(AMBAC), 5.20%, 10/01/22 1,107,550
Aaa AAA 1,650 New Jersey Economic
Development Authority,
Hackensack Water Company,
(MBIA), 5.80%, 3/01/24 1,607,248
Aaa AAA 1,270 Passaic Valley Water
Commissioners, (FGIC),
5.00%, 12/15/22 1,100,214
Aaa AAA 6,130 West New York, New Jersey
Municipal Utilities
Authority, (FGIC), 5.125%,
12/15/17 5,480,772
------------
$ 20,072,559
------------
LEASE/CERTIFICATE OF
PARTICIPATION - 3.7%
Baa1 A- $ 720 County of Atlantic, New
Jersey Public Facilities
Lease Agreement, 8.875%,
1/15/14 $ 929,902
Baa1 A- 785 County of Atlantic, New
Jersey Public Facilities
Lease Agreement, 8.875%,
1/15/15 1,015,043
A1 NR 1,000 Township of Bedminster,
Board of Education,
7.125%, 9/01/10 1,092,370
</TABLE>
51
<PAGE> 21
<TABLE>
- --------------------------------------------------------------------------------
NEW JERSEY TAX FREE PORTFOLIO (CONTINUED)
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS (CONTINUED)
- --------------------------------------------------------------------------------
<CAPTION>
RATINGS
(UNAUDITED)
- ----------------- PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
LEASE/CERTIFICATE OF PARTICIPATION -
(CONTINUED)
Aa AA- 1,000 Mercer County Improvement
Authority, Richard J.
Hughes Justice Complex,
6.05%, 1/01/14 1,000,510
Aa AA- 2,000 Mercer County Improvement
Authority, Richard J.
Hughes Justice Complex,
6.05%, 1/01/15 2,001,020
Aa AA- 1,500 Mercer County Improvement
Authority, Richard J.
Hughes Justice Complex,
6.05%, 1/01/16 1,500,465
Aa AA- 1,500 Mercer County Improvement
Authority, Richard J.
Hughes Justice Complex,
6.05%, 1/01/17 1,500,465
Aa AA- 5,420 New Jersey Building
Authority, 5.00%, 6/15/16 4,785,210
NR A+ 1,000 New Jersey Economic
Development Authority,
Performing Arts Center
Site Acquisition, 6.75%,
6/15/12 1,049,580
------------
$ 14,874,565
------------
MISCELLANEOUS - 4.0%
A1 A+ $ 1,650 New Jersey Economic
Development Authority,
Economic Recovery Fund,
0%, 9/15/09 $ 727,089
A1 A+ 5,500 New Jersey Economic
Development Authority,
Economic Recovery Fund,
0%, 3/15/13 1,911,525
NR NR 7,600 New Jersey Sports and
Exposition Authority,
Monmouth Park, 8.00%,
1/01/25 8,251,167
Aa NR 6,000 New Jersey Sports and
Exposition Authority,
5.20%, 1/01/20 5,318,580
------------
$ 16,208,361
------------
SOLID WASTE - 6.8%
Ba NR $ 3,655 The Atlantic County
Utilities Authority, Solid
Waste Revenue, 7.125%,
3/01/16 $ 3,641,001
Ba BBB+ 6,125 Pollution Control
Financing Authority of
Camden County, (AMT),
7.50%, 12/01/09 6,237,639
Ba NR 5,975 Mercer County Improvement
Authority, Solid Waste
System Revenue, (AMT), 0%,
4/01/14 1,548,003
Ba NR 6,000 Mercer County Improvement
Authority, Solid Waste
System Revenue, (AMT), 0%,
4/01/15 1,445,940
Ba NR 3,000 Mercer County Improvement
Authority, Solid Waste
System Revenue, (AMT), 0%,
4/01/16 672,510
<CAPTION>
RATINGS
(UNAUDITED)
- ----------------- PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
Ba NR 1,500 Passaic County Utilities
Authority Solid Waste
System Revenue, 7.00%,
11/15/07 1,485,795
NR A- 11,930 Union County, New Jersey
Utilities Authority, Solid
Waste Revenue, (AMT),
7.20%, 6/15/14 12,411,376
------------
$ 27,442,264
------------
SPECIAL TAX - 0.2%
Baa1 BBB+ $ 550 Puerto Rico Infrastructure
Financing Authority,
7.90%, 7/01/07 $ 607,574
------------
TRANSPORTATION - 15.1%
NR BBB $ 1,250 Guam Airport Authority,
(AMT), 6.60%, 10/01/10 $ 1,263,675
NR BBB 1,400 Guam Airport Authority,
6.50%, 10/01/23 1,390,886
NR BBB 2,000 Guam Airport Authority,
(AMT), 6.70%, 10/01/23 1,999,740
A1 AA- 3,705 The Port Authority of New
York and New Jersey,
5.25%, 7/15/14 3,396,706
A1 AA- 9,500 The Port Authority of New
York and New Jersey,
7.35%, 10/01/27 (2) 10,438,315
A1 AA- 2,645 The Port Authority of New
York and New Jersey,
6.75%, 8/01/26 2,792,194
A1 AA- 5,000 The Port Authority of New
York and New Jersey,
(AMT), 6.25%, 1/15/27 4,999,750
A1 AA- 9,000 The Port Authority of New
York and New Jersey,
6.125%, 6/01/94 8,962,560
A1 AA- 5,000 The Port Authority of New
York and New Jersey,
5.375%, 3/01/28 4,561,400
Baa1 BB 5,100 The Port Authority of New
York and New Jersey, Delta
Air Lines Inc., 6.95%,
6/01/08 5,356,428
Baa1 A 2,135 Puerto Rico Highway and
Transportation Authority,
6.625%, 7/01/12 2,216,963
Baa1 A 3,000 Puerto Rico Highway and
Transportation Authority,
5.25%, 7/01/21 2,638,110
Baa1 A 4,100 Puerto Rico Highway and
Transportation Authority,
6.625%, 7/01/18 4,243,131
Baa3 BB+ 5,550 Puerto Rico Port
Authority, American
Airlines, (AMT), 6.30%,
6/01/23 5,386,553
</TABLE>
52
<PAGE> 22
<TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS (CONTINUED)
- --------------------------------------------------------------------------------
<CAPTION>
RATINGS
(UNAUDITED)
- ----------------- PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
TRANSPORTATION - (CONTINUED)
NR A+ 1,115 South Jersey Port
Corporation, New Jersey
Marine Terminal, 6.875%,
1/01/20 1,147,224
------------
$ 60,793,635
------------
UTILITY - 2.8%
NR BBB $ 100 Guam Power Authority,
5.25%, 10/01/13 $ 88,727
NR BBB 1,500 Guam Power Authority,
5.25%, 10/01/23 1,267,485
NR BBB 2,000 Guam Power Authority,
6.75%, 10/01/24 2,031,080
A3 BBB+ 625 New Jersey Economic
Development Authority,
Elizabethtown Gas Co.,
(AMT), 6.75%, 10/01/21 632,337
A2 A 1,455 New Jersey Economic
Development Authority,
Natural Gas Facilities,
(AMT), 7.05%, 3/01/16 1,542,387
Baa1 A- 460 Puerto Rico Electric Power
Authority, 7.125%, 7/01/14 498,801
NR NR 5,105 Virgin Islands Water and
Power Authority, Electric
System Revenue, 7.40%,
7/01/11 5,318,032
------------
$ 11,378,849
------------
WATER & SEWER - 2.5%
A1 AA- $ 2,000 Gloucester County
Utilities Authority,
6.50%, 1/01/21 $ 2,062,600
A3 A 3,250 New Jersey Economic
Development Authority,
Elizabethtown Water
Revenue, (AMT), 6.70%,
8/01/21 3,394,853
Aa AA 1,400 New Jersey Wastewater
Treatment Trust, 7.25%,
5/15/08 1,511,230
<CAPTION>
RATINGS
(UNAUDITED)
- ----------------- PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
Aa AA 1,000 New Jersey Wastewater
Treatment Trust, 6.875%,
6/15/09 1,090,310
Aa AA 250 New Jersey Wastewater
Treatment Trust, 7.00%,
6/15/10 273,342
Aa AA 1,000 New Jersey Wastewater
Treatment Trust, 6.00%,
7/01/10 1,022,020
A1 AA 500 The Somerset Raritan
Valley Sewerage Authority,
6.75%, 7/01/10 534,655
------------
$ 9,889,010
------------
TOTAL TAX-EXEMPT
INVESTMENTS (IDENTIFIED
COST, $389,842,758) $403,485,415
============
<FN>
(1) The above designated securities have been issued as inverse floater bonds.
(2) Security has been segregated to cover margin requirements for open financial
futures contracts.
</TABLE>
The Portfolio primarily invests in debt securities issued by New Jersey
municipalities. The ability of the issuers of the debt securities to meet their
obligations may be affected by economic developments in a specific industry or
municipality. In order to reduce the risk associated with such economic
developments, at July 31, 1995, 27.9% of the securities in the portfolio of
investments are backed by bond insurance of various financial institutions and
financial guaranty assurance agencies. The aggregate percentage by financial
institution ranged from 0.1% to 14.5% of total investments.
See notes to financial statements
53
<PAGE> 23
<TABLE>
- --------------------------------------------------------------------------------
Pennsylvania Tax Free Portfolio
Portfolio of Investments - July 31, 1995
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS - 100%
- --------------------------------------------------------------------------------
<CAPTION>
RATINGS
(UNAUDITED)
- ----------------- PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
COGENERATION - 5.3%
NR NR $12,000 Pennsylvania Economic
Development Authority,
Northampton Generating
Project, (AMT), 6.50%,
1/01/13 $ 11,599,320
NR BBB- 9,000 Pennsylvania Economic
Development Authority,
Colver Project, (AMT),
7.125%, 12/01/15 9,437,490
NR BBB- 5,000 Pennsylvania Economic
Development Authority,
Colver Project, (AMT),
7.15%, 12/01/18 5,212,250
------------
$ 26,249,060
------------
EDUCATION - 5.3%
NR BBB $ 4,865 Erie Higher Education
Building Authority,
Mercyhurst College, 5.75%,
3/15/20 $ 4,370,132
Baa1 NR 1,500 Latrobe, Saint Vincent
College, 6.75%, 5/01/24 1,535,460
NR AAA 2,000 Lehigh County, Allentown
College of St. Francis,
6.75%, 12/15/12 2,129,440
Aa AA 3,700 Pennsylvania, University
of Pennsylvania, 6.625%,
1/01/17 3,733,041
NR A- 4,225 Scranton-Lackawanna,
Pennsylvania University,
University of Scranton,
6.40%, 3/01/07 4,368,185
NR AA 9,700 Swarthmore Borough,
Swarthmore College, 6.00%,
9/15/20 9,649,366
------------
$ 25,785,624
------------
ESCROWED - 6.5%
Aaa AAA $ 5,600 Berks County, GO, (FGIC),
Variable, 11/15/20 (1) $ 6,412,000
Aaa A- 1,750 Chester County, HEFA, Bryn
Mar Hospitals, 6.75%,
7/01/14 1,990,468
Aaa AAA 3,195 Derry Township School
District, GO, (AMBAC),
6.20%, 9/01/08 3,430,951
Aaa AAA 2,000 Doylestown Hospital
Authority, Doylestown
Hospital, (AMBAC), 6.90%,
7/01/19 2,219,120
Aaa AAA 1,405 Lycoming County, GO,
(FGIC), 6.40%, 8/15/11 1,540,765
Aaa AAA 945 Lycoming County, GO,
(FGIC), 6.40%, 8/15/11 1,036,315
NR A- 1,000 Pennsylvania, HEFA,
Elizabeth College, 7.25%,
6/15/11 1,150,140
NR A- 6,900 Pennsylvania IDA, Economic
Development, 7.00%,
1/01/11 7,853,649
NR A- 5,155 Philadelphia, Hospital and
Higher Education Facility
Authority, Presbyterian
Medical Center, 6.50%,
12/01/11 5,646,684
<CAPTION>
RATINGS
(UNAUDITED)
- ----------------- PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
Aaa AAA 500 York County Hospital
Authority, York Hospital,
(AMBAC), 7.00%, 7/01/21 565,985
------------
$ 31,846,077
------------
GENERAL OBLIGATIONS - 4.8%
NR A $ 4,725 Chester Upland School
District, 6.375%, 9/01/12 $ 4,828,383
NR A 3,000 Chester Upland School
District, 6.375%, 9/01/21 3,038,070
A1 AA- 465 Commonwealth of
Pennsylvania, 6.75%,
1/01/07 498,182
A1 AA- 500 Commonwealth of
Pennsylvania, 6.75%,
1/01/08 534,465
A1 AA- 5,435 Commonwealth of
Pennsylvania, 6.50%,
11/01/09 5,729,251
A1 AA- 2,000 Commonwealth of
Pennsylvania, 6.375%,
9/15/12 2,074,740
NR A 3,000 Dauphin County, 6.90%,
6/02/26 3,166,320
A1 A+ 2,050 Lower Providence Township
Sewer Authority
Guaranteed, 6.75%, 5/01/22 2,142,066
NR A 1,950 McKeesport Area School
District, 5.00%, 4/01/13 1,741,194
------------
$ 23,752,671
------------
HOSPITALS - 22.6%
NR AAA $ 2,470 Allegheny County, IDA,
Presbyterian Medical
Center, 6.75%, 2/01/26 $ 2,548,842
NR A- 4,000 Butler County IDA,
Sherwood Oaks, 5.75%,
6/01/16 3,588,520
NR AA- 12,000 Chester County, HEFA,
(Main Line Health System),
5.50%, 5/15/15 11,139,000
Baa BBB 2,000 Dauphin County Hospital
Authority, Community
General Osteopathic
Hospital, 7.375%, 6/01/16 2,085,880
NR A- 10,250 Delaware County, Riddle
Memorial Hospital, 6.50%,
1/01/22 9,813,863
NR NR 4,755 Hazelton Luzerne County,
Saint Joseph Medical
Center, 8.375%, 7/01/12 4,892,895
Baa1 NR 2,670 Indiana County Hospital
Authority, Indiana
Hospital, 7.125%, 7/01/23 2,689,838
NR BBB+ 3,500 Lebanon County, Good
Samaritan Hospital, 6.00%,
11/15/18 3,148,285
Baa1 A 3,250 Lehigh County, Muhlenberg
Hospital, 6.60%, 7/15/22 3,233,620
NR BBB- 5,405 McKean County Hospital
Authority, Bradford
Hospital, 6.10%, 10/01/20 4,591,115
</TABLE>
54
<PAGE> 24
<TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS (CONTINUED)
- --------------------------------------------------------------------------------
<CAPTION>
RATINGS
(UNAUDITED)
- ----------------- PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
HOSPITALS - (CONTINUED)
NR BBB+ 2,615 Montgomery County,
Pottstown Medical Center,
6.875%, 11/15/20 2,597,558
A1 A+ 500 PA Hospital and Higher
Education Facility
Authority, Allegheny
General Hospital, 7.25%,
9/01/17 536,535
A BBB+ 8,500 PA Hospital and Higher
Education Facility
Authority, Albert Einstein
Medical Center, 7.625%,
4/01/11 9,054,965
Baa1 BBB+ 12,800 PA Hospital and Higher
Education Facility
Authority, Graduate Health
System, 6.625%, 7/01/21 12,228,480
Aa AA 4,500 PA Hospital and Higher
Education Facility
Authority, Children's
Hospital, 5.50%, 2/15/22 4,125,060
Baa1 A- 10,515 PA Hospital and Higher
Education Facility
Authority, Temple
University Hospital,
6.625%, 11/15/23 10,517,418
Aa AA 10,200 PA Hospital and Higher
Education Facility
Authority, Children's
Hospital, 5.00%, 2/15/21 8,745,276
Aa NR 4,750 Pottsville, Hospital
Authority, Daughters of
Charity, 5.00%, 8/15/12 4,238,093
Baa NR 4,115 Somerset County, Hospital
Authority, Somerset
County, Somerset Community
Hospital Project, 6.750%,
3/01/11 3,950,359
A NR 7,000 Washington County,
Hospital Authority,
Monongahela Valley
Hospital, 6.75%, 12/01/08 7,324,310
------------
$111,049,912
------------
HOUSING - 12.3%
NR AAA $ 1,000 Bucks County, Mortgage
Revenue Bonds, Warminster
Heights Project, Section
8-A, 6.80%, 8/01/12 $ 1,029,520
NR NR 2,680 Chester County, IDA,
8.05%, 1/01/24 2,688,120
A1 A+ 3,000 Pennsylvania HFA MF,
7.60%, 7/01/13 3,210,330
Aaa NR 3,000 Philadelphia Redevelopment
Authority, MF, 6.95%,
5/15/24 3,102,450
Aaa NR 2,175 Allegheny County
Residential Finance
Authority, SFMR, (GNMA),
7.15%, 6/01/17 2,212,410
Aa AA 5,700 Pennsylvania HFA SFMR,
(AMT), 6.75%, 4/01/16 5,816,451
Aa AA 3,730 Pennsylvania HFA SFMR,
6.90%, 4/01/17 3,834,627
<CAPTION>
RATINGS
(UNAUDITED)
- ----------------- PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
Aa AA 4,000 Pennsylvania HFA SFMR,
6.85%, 4/01/16 4,099,080
Aa AA 300 Pennsylvania HFA SFMR,
7.40%, 10/01/09 313,026
Aa AA 770 Pennsylvania HFA SFMR,
7.20%, 10/01/11 809,124
Aa AA 695 Pennsylvania HFA SFMR,
7.375%, 10/01/16 720,048
Aa AA 1,000 Pennsylvania HFA SFMR,
(AMT), Variable, 10/01/23
(1) 1,059,990
Aa AA 5,500 Pennsylvania HFA SFMR,
(AMT), 6.85%, 4/01/25 5,637,280
Aa AA 8,350 Pennsylvania HFA SFMR,
(AMT), 7.50%, 10/01/25 8,868,034
Aa AA 10,000 Pennsylvania HFA SFMR,
(AMT), 6.65%, 10/01/21 10,177,400
A1 A 4,235 Urban Redevelopment
Authority of Pittsburgh
Mortgage Revenue Bonds,
(AMT), 7.10%, 4/01/24 4,259,563
A1 A 265 Urban Redevelopment
Authority of Pittsburgh,
7.45%, 4/01/10 278,663
A1 A 1,000 Urban Redevelopment
Authority of Pittsburgh
Mortgage Revenue Bonds,
7.125%, 4/01/15 1,040,790
A1 A 1,055 Urban Redevelopment
Authority of Pittsburgh
Mortgage Revenue Bonds,
(AMT), 7.40%, 4/01/24 1,096,630
------------
$ 60,253,536
------------
INDUSTRIAL DEVELOPMENT
AUTHORITY - 8.7%
A3 A $ 6,950 Butler County IDA,
Witco Corporation Project,
5.85%, 12/01/23 $ 6,573,449
NR BBB 1,005 Clearfield County IDA,
Kmart Corporation,
6.80%, 5/15/07 1,030,095
NR A+ 4,000 Franklin County IDA,
Corning Incorporated,
6.25%, 8/01/05 4,206,280
NR AAA 8,750 Mercer County IDA,
Hillcrest Nursing Center,
0%, 1/15/13 2,475,375
A2 A 12,000 New Morgan IDA, New Morgan
Landfill, (AMT), 6.50%,
4/01/19 12,155,040
Baa2 BBB- 5,000 Pennsylvania, IDA,
Macmilliam Project, (AMT),
7.60%, 12/01/20 5,385,950
Baa1 BBB+ 4,450 Pennsylvania, IDA, Sun
Company Project, (AMT),
7.60%, 12/01/24 4,807,868
A2 A 6,025 Washington County IDA,
West Penn Power, 6.05%,
4/01/14 5,964,630
------------
$ 42,598,687
------------
</TABLE>
55
<PAGE> 25
<TABLE>
- --------------------------------------------------------------------------------
PENNSYLVANIA TAX FREE PORTFOLIO (CONTINUED)
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS (CONTINUED)
- --------------------------------------------------------------------------------
<CAPTION>
RATINGS
(UNAUDITED)
- ----------------- PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
INSURED AIRPORTS - 1.2%
Aaa AAA $ 6,000 Philadelphia Airport,
(AMBAC), (AMT), 6.00%,
6/15/15 $ 5,903,760
------------
INSURED EDUCATION - 1.1%
Aaa AAA $ 2,500 Pennsylvania Higher
Education Assistance
Agency Student Loan
Revenue Bonds, (AMBAC),
(AMT), 7.15%, 9/01/21 $ 2,639,200
Aaa AAA 1,500 Pennsylvania Higher
Education Assistance
Agency Student Loan
Revenue Bonds, (AMBAC),
(AMT), Variable, 3/01/22
(1) 1,441,965
Aaa AAA 700 Pennsylvania Higher
Education Assistance
Agency Student Loan
Revenue Bonds, (AMBAC),
(AMT), Variable, 9/01/26
(1) 744,744
Aaa AAA 800 Pennsylvania Higher
Education Assistance
Agency Student Loan
Revenue Bonds, (AMBAC),
(AMT), 6.40%, 3/01/22 808,712
------------
$ 5,634,621
------------
INSURED GENERAL OBLIGATION - 3.0%
Aaa AAA $ 1,750 Deer Lakes School
District, (MBIA), 6.45%,
1/15/19 $ 1,792,210
Aaa AAA 2,170 Elizabeth Forward School
District, (MBIA), 0%,
9/01/20 454,701
Aaa AAA 2,170 Elizabeth Forward School
District, (MBIA), 0%,
9/01/21 427,230
Aaa AAA 2,170 Elizabeth Forward School
District, (MBIA), 0%,
9/01/22 401,407
Aaa AAA 2,170 Elizabeth Forward School
District, (MBIA), 0%,
9/01/23 377,168
Aaa AAA 4,345 Elizabeth Forward School
District, (MBIA), 0%,
9/01/24 709,582
Aaa AAA 1,460 Haverford School District,
(FGIC), 6.125%, 6/01/14 1,477,199
Aaa AAA 4,500 Keystone Oaks School
District, (AMBAC),
Variable,
9/01/16 (1) 4,348,170
Aaa AAA 1,430 Mars Area School District,
(MBIA), 0%, 3/01/14 474,245
Aaa AAA 655 Rochester Area School
District, (AMBAC), 0%,
5/01/10 278,703
Aaa AAA 2,795 Venango County, (AMBAC),
6.30%, 12/01/19 2,850,453
Aaa AAA 1,000 West Allegheny County
School District, (AMBAC),
6.60%, 2/01/09 1,034,210
------------
$ 14,625,278
------------
<CAPTION>
RATINGS
(UNAUDITED)
- ----------------- PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
INSURED HOSPITAL - 7.1%
Aaa AAA $ 1,170 Allegheny County,
Children's Hospital of
Pittsburgh, (MBIA), 6.75%,
7/01/08 $ 1,234,175
Aaa AAA 3,750 Allegheny County, Magee-
Womens Hospital, (FGIC),
0%, 10/01/15 1,114,425
Aaa AAA 1,400 Armstrong County Saint
Francis Health Care,
(AMBAC), 6.25%, 6/01/13 1,430,296
Aaa AAA 2,500 Armstrong County Saint
Francis Health Care,
(AMBAC), 6.00%, 8/15/08 2,557,425
Aaa AAA 4,400 Bucks County, IDA, Grand
View Hospital, (AMBAC),
5.25%, 7/01/21 3,889,864
Aaa AAA 775 Carbon County, Gnaden
Memorial Hospital,
(AMBAC), 7.00%, 11/15/14 825,243
Aaa AAA 750 Erie County Hospital
Authority, Harlot Medical
Center, (AMBAC), 7.10%,
2/15/10 811,313
Aaa AAA 230 Lehigh County Health East,
Incorporated, (MBIA),
7.00%, 7/01/15 244,801
Aaa AAA 5,000 Lehigh County, St. Luke's
Hospital, (AMBAC), 6.25%,
7/01/22 5,091,850
Aaa AAA 1,000 Montgomery County,
Abington Memorial
Hospital, (AMBAC),
Variable,
6/01/11 (1) 1,111,250
Aaa AAA 5,000 Philadelphia Hospital and
Higher Education,
Pennsylvania Hospital,
(FGIC), Variable, 2/15/12
(1) 4,368,500
Aaa AAA 3,500 Sayre Health Care
Facilities Authority,
Guthrie Healthcare System,
(AMBAC), 6.00%, 3/01/21 3,490,690
Aaa AAA 1,500 Scranton-Lackawanna, Mercy
Health Systems, (MBIA),
6.90%, 1/01/23 1,577,370
Aaa AAA 7,500 Washington County,
Shadyside Hospital,
(AMBAC), 5.75%, 12/15/14 7,277,924
------------
$ 35,025,126
------------
INSURED LEASE - 4.1%
Aaa AAA $ 4,595 Harrisburg Authority,
Dauphin County, Lease
Revenue, (CGIC), 6.25%,
6/01/10 $ 4,904,335
Aaa AAA 3,000 Northumberland County,
Lease Revenue, (MBIA), 0%,
10/15/12 1,109,040
Aaa AAA 5,600 Philadelphia Muni
Authority, Lease Revenue,
(FGIC), 5.625%, 11/15/18 5,317,592
</TABLE>
56
<PAGE> 26
<TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS (CONTINUED)
- --------------------------------------------------------------------------------
<CAPTION>
RATINGS
(UNAUDITED)
- ----------------- PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
INSURED LEASE - (CONTINUED)
Aaa AAA 10,000 Commonwealth of
Pennsylvania, Lease
Revenue, (AMBAC), 5.00%,
7/01/15 8,751,600
------------
$ 20,082,567
------------
INSURED UTILITIES - 3.9%
Aaa AAA $ 4,000 Beaver County IDA, Ohio
Edison Company, (FGIC),
7.00%, 6/01/21 $ 4,270,880
Aaa AAA 10,000 Beaver County IDA, Ohio
Edison Company, (FGIC),
7.05%, 10/01/20 10,708,500
Aaa AAA 3,800 Puerto Rico Electric Power
Authority, (FSA),
Variable, 7/01/02 (1) 4,116,578
------------
$ 19,095,958
------------
INSURED WATER & SEWER - 6.2%
Aaa AAA $ 2,750 Allegheny County, Sewer
Revenue, (FGIC), 0%,
12/01/08 $ 1,296,845
Aaa AAA 9,000 Bethlehem Authority,
Northampton and Lehigh
Counties, Water Revenue
Bonds, (MBIA), 4.875%,
11/15/14 7,805,070
Aaa AAA 2,500 City of Philadelphia,
Water and Wastewater,
(FGIC), Variable, 6/15/12
(1) 2,350,000
Aaa AAA 9,000 City of Philadelphia,
Water and Wastewater,
(CGIC), 5.50%, 6/15/15 8,441,280
Aaa AAA 2,460 City of Philadelphia,
Water and Wastewater,
(CGIC), 5.00%, 6/15/16 2,145,440
Aaa AAA 8,920 City of Philadelphia,
Water and Wastewater,
(MBIA), 5.60%, 8/01/18 8,435,555
------------
$ 30,474,190
------------
MISCELLANEOUS - 3.8%
NR AA $ 870 Pennsylvania
Infrastructure Investment
Authority, Pennvest,
6.80%, 9/01/10 $ 922,487
NR A 16,950 Pennsylvania Finance
Authority, Beaver County,
6.60%, 11/01/09 17,744,277
------------
$ 18,666,764
------------
NURSING HOMES - 1.3%
NR NR $ 3,500 Montgomery County IDA,
Geriatric Health Care
Institute, 8.375%, 7/01/23 $ 3,493,910
NR NR 1,460 Westmoreland County IDA,
Highland Health System,
9.25%, 6/01/22 1,517,860
<CAPTION>
RATINGS
(UNAUDITED)
- ----------------- PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
NR NR 1,190 Philadelphia Hospital and
Higher Education
Facilities Authority,
Philadelphia Protestant,
8.625%, 7/01/21 1,200,995
------------
$ 6,212,765
------------
SPECIAL TAX REVENUE - 0.1%
Baa1 BBB+ $ 500 Puerto Rico Special Tax
Revenue, 7.50%, 7/01/09 $ 535,485
------------
TRANSPORTATION - 0.3%
Baa1 A $ 1,500 Puerto Rico Commonwealth
Highway, 5.50%, 7/01/13 $ 1,415,115
------------
UTILITIES - 2.2%
Baa3 BB+ $ 500 Beaver County, IDA, Ohio
Edison Company, 7.75%,
9/01/24 $ 524,550
Baa1 BBB+ 3,250 Delaware County, IDA,
Philadelphia Electric
Company, 7.375%, 4/01/21 3,462,745
Baa1 BBB+ 4,070 Montgomery County, IDA,
Philadelphia Electric
Company, (AMT), 7.60%,
4/01/21 4,337,358
Baa1 A- 3,370 Puerto Rico Electric Power
Authority Power Revenue,
0%, 7/01/17 863,866
NR NR 1,500 Virgin Islands Water and
Power Authority, 7.40%,
7/01/11 1,562,595
------------
$ 10,751,114
------------
WATER & SEWER REVENUE - 0.2%
Baa1 A $ 1,000 Puerto Rico Aqueduct and
Sewer Authority, 7.90%,
7/01/07 $ 1,109,020
------------
TOTAL TAX-EXEMPT
INVESTMENTS (IDENTIFIED
COST, $477,086,127) $491,067,330
============
<FN>
(1) The above designated securities have been issued as inverse floater bonds.
</TABLE>
The Portfolio primarily invests in debt securities issued by Pennsylvania
municipalities. The ability of the issuers of debt securities to meet their
obligations may be affected by economic developments in a specific industry or
municipality. In order to reduce the risk associated with such economic
developments, at July 31, 1995, 28.3% of the securities in the portfolio of
investments are backed by bond insurance of various financial institutions and
financial guaranty assurance agencies. The aggregate percentage by financial
institution ranged from 0.4% to 11.5% of total investments.
See notes to financial statements
57
<PAGE> 27
<TABLE>
- --------------------------------------------------------------------------------
Texas Tax Free Portfolio
Portfolio of Investments - July 31, 1995
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS - 100%
- --------------------------------------------------------------------------------
<CAPTION>
RATINGS
(UNAUDITED)
- ----------------- PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
EDUCATION - 3.7%
A NR $ 700 Brazos Higher Education
Authority, Texas Student
Loan Subordinate, 6.50%,
6/01/04 $ 727,524
Aa1 AA 250 University of Texas, 6.75%,
8/15/13 (1) 267,055
-----------
$ 994,579
-----------
ELECTRIC UTILITIES - 1.6%
NR BBB $ 500 Guam Power Authority,
5.25%, 10/01/23 $ 422,495
-----------
ESCROWED - 3.6%
Baa1 BBB $ 200 Bexar County, Texas, St.
Luke's Lutheran Hospital,
7.00%, 5/01/21 $ 227,466
Aaa NR 1,000 Central Texas Housing
Corporation Single Family,
0%, 9/01/16 270,510
Aaa AAA 85 Harris County Texas Toll
Road Unlimited Tax and
Subordinate Lien (AMBAC),
6.625%, 8/15/17 90,796
Aaa AAA 200 Montgomery County, Texas
Hospital District (FSA),
6.625%, 4/01/17 224,720
Aaa AAA 150 Texas National Research Lab
Super Collider, 6.95%,
12/01/12 167,802
-----------
$ 981,294
-----------
GENERAL OBLIGATIONS - 16.8%
Aaa AAA $1,000 Bastrop, Texas Independent
School District U.T.G.O.
(PSF), 0.00%, 2/15/13 $ 349,880
Aaa NR 500 Crandall, Texas Independent
School District U.T.G.O.
(PSF), 6.00%, 2/15/24 495,935
Aaa AAA 1,000 Cypress-Fairbanks, Texas
Independent School District
U.T.G.O. (PSF), 5.25%,
2/15/19 904,900
Aaa AAA 550 Grand Prairie, Texas
Independent School District
U.T.G.O. (PSF), 0%, 2/15/12 202,680
Aaa AA+ 350 Irving, Texas L.T.G.O.
4.875%, 9/15/14 (1) 309,544
Aaa AAA 1,000 Round Rock, Texas
Independent School District
U.T.G.O. (PSF), 5.50%,
8/01/15 948,900
Aa AA 250 Texas Veterans' Housing
Assistance U.T.G.O. (AMT),
6.45%, 6/01/23 247,420
Aa AA 690 Texas Veterans' Housing
Assistance U.T.G.O. (AMT),
6.70%, 12/01/24 697,321
Aa AA 395 Texas Veterans' Housing
Assistance U.T.G.O. (AMT),
6.80%, 12/01/23 401,980
-----------
$ 4,558,560
-----------
<CAPTION>
RATINGS
(UNAUDITED)
- ----------------- PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
HEALTH CARE - 1.9%
NR NR $ 500 Bell County, Texas HFC
Elder Care Facilities,
9.00%, 11/01/24 $ 523,725
-----------
HOSPITALS - 11.1%
NR BBB $ 500 Denison, Texas, Texoma
Medical Center, 7.10%,
8/15/24 $ 502,255
A A- 100 Ector County, Texas
Hospital District, 7.30%,
4/15/12 105,170
A A- 100 Harris County, Texas
Hospital District, 7.125%,
6/01/15 104,750
A A- 1,100 Harris County, Texas
Hospital District, Memorial
Hospital System, 6.625%,
6/01/24 1,114,696
Aa AA 250 McAllen Health Facilities,
Texas, Sisters of Mercy,
5.00%, 6/01/15 220,160
A1 NR 1,000 Tarrant County, Texas,
Methodist Health System,
6.00%, 9/01/24 971,830
-----------
$ 3,018,861
-----------
HOUSING - 4.2%
Aa NR $ 400 Kaufman, Texas HDC
Multifamily (FHA) Section
8, 6.00%, 2/01/22 $ 377,764
NR A 750 Travis County, Texas HFC
Multifamily Travis Station
Apartments, 6.75%, 4/01/19 762,435
-----------
$ 1,140,199
-----------
INDUSTRIAL DEVELOPMENT REVENUE/
POLLUTION CONTROL REVENUE - 7.0%
Baa1 BBB $ 450 Gulf Coast, Texas Waste
Disposal Authority,
Champion International
(AMT), 7.25%, 4/01/17 $ 481,401
A2 A+ 1,000 Port Corpus Christi, Texas,
Hoechst Celanese
Corporation, 6.875%,
4/01/17 1,048,690
Baa2 BBB 400 West Side Calhoun County
Navigation District, Texas,
Union Carbide (AMT), 6.40%,
5/01/23 380,572
-----------
$ 1,910,663
-----------
INSURED EDUCATION - 0.4%
Aaa AAA $ 100 Southwest, Texas, Southern
Methodist University
(FGIC), 6.375%, 10/01/13 $ 104,393
-----------
INSURED ELECTRIC UTILITIES - 14.5%
Aaa AAA $1,000 Austin, Texas Utility
System (FGIC), 6.25%,
5/15/16 $ 1,020,160
Aaa AAA 250 Brazos River Authority,
Texas, Houston Lighting and
Power Company (FGIC),
7.20%, 12/01/18 267,497
</TABLE>
58
<PAGE> 28
<TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
TAX-EXEMPT INVESTMENTS (CONTINUED)
- --------------------------------------------------------------------------------
<CAPTION>
RATINGS
(UNAUDITED)
- ----------------- PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
INSURED ELECTRIC UTILITIES -
(CONTINUED)
Aaa AAA 75 Brazos River Authority,
Texas, Houston Light and
Power (AMBAC), 6.70%,
3/01/17 78,424
Aaa AAA 1,050 Corpus Christi, Texas
Utility System (MBIA),
5.20%, 7/15/13 960,561
Aaa AAA 500 Lower Colorado River
Authority Junior Lien,
Texas (FGIC), 0%, 1/01/12 183,855
Aaa AAA 605 Montgomery County, Texas
MUD #47 Water & Sewer
(AMBAC), 6.125%, 10/01/20 607,432
Aaa AAA 100 Sabine River Authority,
Texas, Utilities Electric
Company (FGIC), 6.55%,
10/01/22 103,182
Aaa AAA 1,395 Texas Municipal Power
Agency (MBIA), 0%, 9/01/13 463,405
Aaa AAA 1,000 Texas Municipal Power
Agency (MBIA), 0%, 9/01/17 254,790
-----------
$ 3,939,306
-----------
INSURED GENERAL OBLIGATION - 1.9%
Aaa AAA $ 100 Brownsville, Texas
Navigation District
(AMBAC), 6.25%, 3/01/14 $ 102,245
Aaa AAA 500 Ector County, Texas G.O.
(AMBAC), 4.25%, 2/15/10 426,335
-----------
$ 528,580
-----------
INSURED HOSPITAL - 6.6%
Aaa AAA $ 250 Coastal Bend, Texas HFC
Incarnate Word Health
Services (AMBAC), 6.30%,
1/01/17 $ 254,058
Aaa AAA 500 Harris County, Texas HFC
Hermann Hospital (MBIA),
6.375%, 10/01/24 (1) 507,320
Aaa AAA 1,000 Tyler County, Texas HFC
Mother Frances Hospital
(FGIC), 6.50%, 7/01/22 1,029,190
-----------
$ 1,790,568
-----------
INSURED LEASE/COP - 1.7%
Aaa AAA $ 500 East Texas Jails, Angelina
County Project (MBIA),
5.25%, 5/01/14 $ 459,665
-----------
INSURED TRANSPORTATION - 12.0%
Aaa AAA $ 500 Dallas-Fort Worth
International Airport,
Texas (MBIA), 6.00%,
11/01/12 $ 504,175
Aaa AAA 500 Dallas-Fort Worth
International Airport,
Texas (FGIC), 5.625%,
11/01/15 475,890
Aaa AAA 500 Harris County, Texas Toll
Road Senior Lien (AMBAC),
5.30%, 8/15/13 465,385
Aaa AAA 2,000 Harris County, Texas Toll
Road Subordinate Lien
(FGIC), 5.375%, 8/15/20 1,819,820
-----------
$ 3,265,270
-----------
<CAPTION>
RATINGS
(UNAUDITED)
- ----------------- PRINCIPAL
AMOUNT
STANDARD (000
MOODY'S & POOR'S OMITTED) SECURITY VALUE
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C>
INSURED WATER & SEWER - 1.7%
Aaa AAA $ 520 Tarrant County, Texas Water
and Improvement District
Number One (AMBAC), 4.75%,
3/01/12 $ 450,819
-----------
LEASE/COP - 0.9%
NR BBB- $ 250 Rio Grande, Texas
Independent School District
Lease, 6.75%, 7/15/10 $ 241,558
-----------
MISCELLANEOUS - 5.9%
Baa2 BB+ $ 505 Alliance Airport Authority,
Texas, American Airlines,
7.50%, 12/01/29 $ 524,180
Aaa AAA 1,000 Austin, Texas Hotel
Occupancy Tax Revenue,
5.125% (AMBAC), 11/15/19 882,970
NR NR 250 Retama Development, Texas,
Retama Racetrack, 8.75%,
12/15/18 200,000
-----------
$ 1,607,150
-----------
TRANSPORTATION - 3.7%
Ba1 BB $ 235 Dallas-Fort Worth Texas
Airport, Delta Airlines
(AMT), 7.125%, 11/01/26 $ 239,872
Baa2 BB+ 225 Dallas-Fort Worth Texas
Airport, Delta Airlines
(AMT), 7.50%, 11/01/25 233,986
NR BBB 255 Guam Airport Authority
(AMT), 6.70%, 10/01/23 254,967
Aa AA 25 Harris County, Texas Toll
Road, Subordinate Lien,
6.75%, 8/01/14 26,726
Baa3 BB+ 250 Puerto Rico Ports
Authority, American
Airlines (AMT), 6.30%,
6/01/23 242,637
-----------
$ 998,188
-----------
WATER & SEWER REVENUE - 0.8%
Aa AA $ 250 Dallas, Texas Water and
Sewer, 5.00%, 4/01/09 $ 236,018
-----------
TOTAL TAX-EXEMPT
INVESTMENTS (IDENTIFIED
COST, $26,750,393) $27,171,891
===========
<FN>
(1) Security has been segregated to cover margin requirements for open financial
futures contracts.
</TABLE>
The Portfolio invests primarily in debt securities issued by Texas
municipalities. The ability of the issuers of the debt securities to meet their
obligations may be affected by economic developments in a specific industry or
municipality. In order to reduce the risk associated with such economic
developments, at July 31, 1995, 55.3% of the securities in the portfolio of
investments are backed by bond insurance of various financial guaranty assurance
agencies. The aggregate percentage by financial institution ranges from 0.8% to
18.4% of total investments.
See notes to financial statements
59
<PAGE> 29
- --------------------------------------------------------------------------------
Tax Free Portfolios
Financial Statements
<TABLE>
STATEMENTS OF ASSETS AND LIABILITIES
- --------------------------------------------------------------------------------
July 31, 1995
- --------------------------------------------------------------------------------
<CAPTION>
ARIZONA COLORADO CONNECTICUT MICHIGAN
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
------------ ----------- ------------ ------------
<S> <C> <C> <C> <C>
ASSETS:
Investments --
Identified cost $140,218,111 $44,277,269 $192,808,845 $182,066,681
Unrealized appreciation (depreciation) 3,828,622 1,159,426 (1,554,336) 4,460,215
------------ ----------- ------------ ------------
Total investments, at value (Note 1A) $144,046,733 $45,436,695 $191,254,509 $186,526,896
Cash 426 687,824 1,592,566 2,048,393
Receivable for investments sold -- 35,463 -- 800,000
Interest receivable 1,411,599 596,740 2,509,768 2,949,373
Deferred organization expenses (Note 1D) 4,476 1,464 6,823 6,501
------------ ----------- ------------ ------------
Total assets $145,463,234 $46,758,186 $195,363,666 $192,331,163
------------ ----------- ------------ ------------
LIABILITIES:
Payable for when issued securities (Note 1F) $ -- $ 658,200 $ -- $ 964,896
Payable for daily variation margin on open financial
futures contracts (Note 1E) 33,469 20,719 77,031 99,875
Demand note payable (Note 5) 903,000 -- -- --
Payable to affiliates --
Trustees' fees 669 135 919 889
Custodian fees 2,924 639 3,823 --
Accrued expenses 2,157 1,327 6,104 2,522
------------ ----------- ------------ ------------
Total liabilities $ 942,219 $ 681,020 $ 87,877 $ 1,068,182
------------ ----------- ------------ ------------
Net Assets applicable to investors' interest in
Portfolio $144,521,015 $46,077,166 $195,275,789 $191,262,981
============ =========== ============ ============
SOURCES OF NET ASSETS:
Net proceeds from capital contributions and
withdrawals $140,643,966 $44,887,762 $196,718,666 $186,667,067
Unrealized appreciation (depreciation) of investments
and financial futures contracts (computed on the
basis ofidentified cost) 3,877,049 1,189,404 (1,442,877) 4,595,914
------------ ----------- ------------ ------------
Total $144,521,015 $46,077,166 $195,275,789 $191,262,981
============ =========== ============ ============
</TABLE>
See notes to financial statements
60
<PAGE> 30
<TABLE>
- --------------------------------------------------------------------------------
STATEMENTS OF ASSETS AND LIABILITIES
- --------------------------------------------------------------------------------
July 31, 1995
- --------------------------------------------------------------------------------
<CAPTION>
MINNESOTA NEW JERSEY PENNSYLVANIA TEXAS
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
----------- ------------ ------------ -----------
<S> <C> <C> <C> <C>
ASSETS:
Investments --
Identified cost $78,851,048 $389,842,758 $477,086,127 $26,750,393
Unrealized appreciation 2,570,065 13,642,657 13,981,203 421,498
----------- ------------ ------------ -----------
Total investments, at value (Note 1A) $81,421,113 $403,485,415 $491,067,330 $27,171,891
Cash 400,411 1,075,446 4,181,885 1,058,371
Receivable for investments sold -- 3,861,470 30,000 --
Interest receivable 1,168,552 5,337,412 6,962,611 472,632
Receivable from the Investment Adviser (Note 2) -- -- -- 18,606
Deferred organization expenses (Note 1D) 2,508 11,270 13,558 1,415
----------- ------------ ------------ -----------
Total assets $82,992,584 $413,771,013 $502,255,384 $28,722,915
----------- ------------ ------------ -----------
LIABILITIES:
Payable for investments purchased $ -- $ 2,654,715 $ -- $ 479,270
Payable for daily variation margin on open financial
futures contracts (Note 1E) 21,250 66,406 -- 14,875
Payable to affiliates --
Trustees' fees 540 1,406 1,713 137
Custodian fees 1,572 5,883 -- 211
Accrued expenses 1,526 4,181 3,367 1,401
----------- ------------ ------------ -----------
Total liabilities $ 24,888 $ 2,732,591 $ 5,080 $ 495,894
----------- ------------ ------------ -----------
Net Assets applicable to investors' interest in
Portfolio $82,967,696 $411,038,422 $502,250,304 $28,227,021
=========== ============ ============ ===========
SOURCES OF NET ASSETS:
Net proceeds from capital contributions and
withdrawals $80,383,134 $397,350,461 $488,269,101 $27,771,750
Unrealized appreciation of investments and financial
futures contracts (computed on the basis of
identified cost) 2,584,562 13,687,961 13,981,203 455,271
----------- ------------ ------------ -----------
Total $82,967,696 $411,038,422 $502,250,304 $28,227,021
=========== ============ ============ ===========
</TABLE>
See notes to financial statements
61
<PAGE> 31
- --------------------------------------------------------------------------------
FINANCIAL STATEMENTS (Continued)
<TABLE>
STATEMENTS OF OPERATIONS
- --------------------------------------------------------------------------------
Year Ended July 31, 1995
- --------------------------------------------------------------------------------
<CAPTION>
ARIZONA COLORADO CONNECTICUT MICHIGAN
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
INVESTMENT INCOME (NOTE 1B):
Interest income $ 9,380,468 $ 2,916,273 $12,024,017 $12,313,929
----------- ----------- ----------- -----------
Expenses --
Investment adviser fee (Note 2) $ 629,148 $ 128,496 $ 835,605 $ 856,258
Compensation of Trustees not members of the Investment
Adviser's organization (Note 2) 9,186 1,335 17,185 11,255
Custodian fees (Note 2) 65,302 16,604 48,135 1,944
Interest expense (Note 5) 24,478 7,980 55,056 19,364
Legal and accounting services 23,018 20,942 27,771 26,172
Bond pricing 11,371 7,911 15,577 14,364
Amortization of organization expenses (Note 1D) 1,793 637 2,620 2,493
Printing and postage 200 -- 552 --
Registration costs 125 125 125 125
Miscellaneous 4,266 1,133 15,780 4,161
----------- ----------- ----------- -----------
Total expenses $ 768,887 $ 185,163 $ 1,018,406 $ 936,136
Deduct reduction of investment adviser fee (Note 2) -- 69,064 -- --
----------- ----------- ----------- -----------
Net expenses $ 768,887 $ 116,099 $ 1,018,406 $ 936,136
----------- ----------- ----------- -----------
Net investment income $ 8,611,581 $ 2,800,174 $11,005,611 $11,377,793
----------- ----------- ----------- -----------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized loss --
Investment transactions (identified cost basis) $(4,877,347) $(1,800,477) $(2,556,284) $(3,817,102)
Financial futures contracts (995,149) (721,504) (2,778,750) (2,415,234)
----------- ----------- ----------- -----------
Net realized loss on investments $(5,872,496) $(2,521,981) $(5,335,034) $(6,232,336)
----------- ----------- ----------- -----------
Change in unrealized appreciation --
Investments $ 7,691,430 $ 2,725,487 $ 3,995,907 $ 6,667,070
Financial futures contracts 166,028 98,064 537,717 280,007
----------- ----------- ----------- -----------
Net unrealized appreciation of investments $ 7,857,458 $ 2,823,551 $ 4,533,624 $ 6,947,077
----------- ----------- ----------- -----------
Net realized and unrealized gain (loss) on
investments $ 1,984,962 $ 301,570 $ (801,410) $ 714,741
----------- ----------- ----------- -----------
Net increase in net assets from operations $10,596,543 $ 3,101,744 $10,204,201 $12,092,534
=========== =========== =========== ===========
</TABLE>
See notes to financial statements
62
<PAGE> 32
<TABLE>
- --------------------------------------------------------------------------------
STATEMENTS OF OPERATIONS
- --------------------------------------------------------------------------------
Year Ended July 31, 1995
- --------------------------------------------------------------------------------
<CAPTION>
MINNESOTA NEW JERSEY PENNSYLVANIA TEXAS
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
----------- ------------ ------------ -----------
<S> <C> <C> <C> <C>
INVESTMENT INCOME (NOTE 1B):
Interest income $ 5,259,766 $ 26,778,322 $ 33,140,571 $ 1,711,252
----------- ------------ ------------ -----------
Expenses --
Investment adviser fee (Note 2) $ 310,489 $ 1,944,340 $ 2,416,419 $ 56,319
Compensation of Trustees not members of the
Investment Adviser's organization (Note 2) 5,240 14,740 20,013 1,753
Custodian fees (Note 2) 20,399 91,170 -- 7,834
Interest expense (Note 5) 18,478 38,870 11,820 3,559
Legal and accounting services 23,039 35,317 38,577 16,838
Bond pricing 11,391 18,054 15,974 8,533
Amortization of organization expenses (Note 1D) 1,018 4,464 5,278 605
Registration costs -- 125 125 125
Miscellaneous 2,379 8,434 8,815 208
----------- ------------ ------------ -----------
Total expenses $ 392,433 $ 2,155,514 $ 2,517,021 $ 95,774
----------- ------------ ------------ -----------
Deduct --
Reduction of investment adviser fee (Note 2) $ -- $ -- $ -- $ 56,319
Allocation of expenses to the Investment Adviser
(Note 2) -- -- -- 18,606
----------- ------------ ------------ -----------
Total $ -- $ -- $ -- $ 74,925
----------- ------------ ------------ -----------
Net expenses $ 392,433 $ 2,155,514 $ 2,517,021 $ 20,849
----------- ------------ ------------ -----------
Net investment income $ 4,867,333 $ 24,622,808 $ 30,623,550 $ 1,690,403
----------- ------------ ------------ -----------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized loss --
Investment transactions (identified cost basis) $(3,665,826) $(13,015,045) $(13,832,451) $ (610,466)
Financial futures contracts (1,549,418) (4,759,465) (6,462,533) (393,285)
----------- ------------ ------------ -----------
Net realized loss on investments $(5,215,244) $(17,774,510) $(20,294,984) $(1,003,751)
----------- ------------ ------------ -----------
Change in unrealized appreciation --
Investments $ 4,573,005 $ 15,570,319 $ 16,678,284 $ 1,169,634
Financial futures contracts 195,669 1,061,635 2,323,941 50,424
----------- ------------ ------------ -----------
Net unrealized appreciation of investments $ 4,768,674 $ 16,631,954 $ 19,002,225 $ 1,220,058
----------- ------------ ------------ -----------
Net realized and unrealized gain (loss) on
investments $ (446,570) $ (1,142,556) $ (1,292,759) $ 216,307
----------- ------------ ------------ -----------
Net increase in net assets from operations $ 4,420,763 $ 23,480,252 $ 29,330,791 $ 1,906,710
=========== ============ ============ ===========
</TABLE>
See notes to financial statements
63
<PAGE> 33
- --------------------------------------------------------------------------------
FINANCIAL STATEMENTS (Continued)
<TABLE>
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
Year Ended July 31, 1995
- --------------------------------------------------------------------------------
<CAPTION>
ARIZONA COLORADO CONNECTICUT MICHIGAN
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
From operations --
Net investment income $ 8,611,581 $ 2,800,174 $ 11,005,611 $ 11,377,793
Net realized loss on investment transactions (5,872,496) (2,521,981) (5,335,034) (6,232,336)
Change in unrealized appreciation of investments 7,857,458 2,823,551 4,533,624 6,947,077
------------ ------------ ------------ ------------
Net increase in net assets from operations $ 10,596,543 $ 3,101,744 $ 10,204,201 $ 12,092,534
------------ ------------ ------------ ------------
Capital transactions --
Contributions $ 21,272,707 $ 10,355,365 $ 25,911,862 $ 14,779,804
Withdrawals (41,416,595) (11,778,902) (32,878,239) (39,641,020)
------------ ------------ ------------ ------------
Decrease in net assets resulting from capital
transactions $(20,143,888) $ (1,423,537) $ (6,966,377) $(24,861,216)
------------ ------------ ------------ ------------
Total increase (decrease) in net assets $ (9,547,345) $ 1,678,207 $ 3,237,824 $(12,768,682)
NET ASSETS:
At beginning of year 154,068,360 44,398,959 192,037,965 204,031,663
------------ ------------ ------------ ------------
At end of year $144,521,015 $ 46,077,166 $195,275,789 $191,262,981
============ ============ ============ ============
</TABLE>
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MINNESOTA NEW JERSEY PENNSYLVANIA TEXAS
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
------------ ------------ ------------- -----------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
From operations --
Net investment income $ 4,867,333 $ 24,622,808 $ 30,623,550 $ 1,690,403
Net realized loss on investment transactions (5,215,244) (17,774,510) (20,294,984) (1,003,751)
Change in unrealized appreciation of investments 4,768,674 16,631,954 19,002,225 1,220,058
------------ ------------ ------------ -----------
Net increase in net assets from operations $ 4,420,763 $ 23,480,252 $ 29,330,791 $ 1,906,710
------------ ------------ ------------ -----------
Capital transactions --
Contributions $ 11,350,380 $ 43,487,001 $ 38,709,755 $ 4,736,724
Withdrawals (16,808,817) (79,782,847) (102,576,381) (6,005,420)
------------ ------------ ------------ -----------
Decrease in net assets resulting from capital
transactions $ (5,458,437) $(36,295,846) $(63,866,626) $(1,268,696)
------------ ------------ ------------ -----------
Total increase (decrease) in net assets $ (1,037,674) $(12,815,594) $(34,535,835) $ 638,014
NET ASSETS:
At beginning of year 84,005,370 423,854,016 536,786,139 27,589,007
------------ ------------ ------------ -----------
At end of year $ 82,967,696 $411,038,422 $502,250,304 $28,227,021
============ ============ ============ ===========
</TABLE>
See notes to financial statements
64
<PAGE> 34
<TABLE>
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
Year Ended July 31, 1994*
- --------------------------------------------------------------------------------
<CAPTION>
ARIZONA COLORADO CONNECTICUT MICHIGAN
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
------------ ----------- ------------ ------------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
From operations --
Net investment income $ 6,694,909 $ 1,681,554 $ 8,098,918 $ 9,191,618
Net realized gain (loss) on investment
transactions (79,923) (238,197) 610,531 459,500
Change in unrealized depreciation of investments (11,906,679) (2,832,041) (15,885,963) (15,894,224)
------------ ----------- ----------- ------------
Net decrease in net assets from operations $ (5,291,693) $(1,388,684) $ (7,176,514) $ (6,243,106)
------------ ----------- ----------- ------------
Capital transactions --
Contributions $ 49,588,326 $25,061,524 $ 55,286,988 $ 43,549,085
Withdrawals (23,767,597) (3,620,273) (15,920,869) (20,939,507)
------------ ----------- ----------- ------------
Increase in net assets resulting from capital
transactions $ 25,820,729 $21,441,251 $ 39,366,119 $ 22,609,578
------------ ----------- ----------- ------------
Total increase in net assets $ 20,529,036 $20,052,567 $ 32,189,605 $ 16,366,472
NET ASSETS:
At beginning of period 133,539,324 24,346,392 159,848,360 187,665,191
------------ ----------- ----------- ------------
At end of period $154,068,360 $44,398,959 $192,037,965 $204,031,663
============ =========== ============ ============
</TABLE>
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MINNESOTA NEW JERSEY PENNSYLVANIA TEXAS
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
----------- ------------ ------------ -----------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
From operations --
Net investment income $ 3,534,268 $ 19,598,942 $ 25,052,308 $ 1,024,502
Net realized gain (loss) on investment transactions 361,104 1,931,832 (1,606,336) (193,762)
Change in unrealized depreciation of investments (6,315,849) (34,629,145) (41,094,537) (1,491,855)
----------- ------------ ------------ -----------
Net decrease in net assets from operations $(2,420,477) $(13,098,371) $(17,648,565) $ (661,115)
----------- ------------ ------------ -----------
Capital transactions --
Contributions $28,250,170 $ 95,610,275 $113,666,177 $14,312,043
Withdrawals (8,843,182) (52,334,675) (56,232,111) (2,091,287)
----------- ------------ ------------ -----------
Increase in net assets resulting from capital
transactions $19,406,988 $ 43,275,600 $ 57,434,066 $12,220,756
----------- ------------ ------------ -----------
Total increase in net assets $16,986,511 $ 30,177,229 $39,785,501 $11,559,641
NET ASSETS:
At beginning of period 67,018,859 393,676,787 497,000,638 16,029,366
----------- ------------ ------------ -----------
At end of period $84,005,370 $423,854,016 $536,786,139 $27,589,007
=========== ============ ============ ===========
<FN>
* For the ten months ended July 31, 1994 (Note 7).
</TABLE>
See notes to financial statements
65
<PAGE> 35
- --------------------------------------------------------------------------------
FINANCIAL STATEMENTS (Continued)
<TABLE>
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
Year Ended September 30, 1993*
- --------------------------------------------------------------------------------
<CAPTION>
ARIZONA COLORADO CONNECTICUT MICHIGAN
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
------------ ----------- ------------ ------------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
From operations --
Net investment income $ 3,814,722 $ 529,081 $ 4,491,010 $ 5,803,151
Net realized gain (loss) on investment
transactions 2,843,057 (42,421) (369,709) (383,574)
Change in unrealized appreciation (depreciation)
of investments 5,331,763 1,030,366 8,422,527 9,602,839
------------ ----------- ------------ ------------
Net increase in net assets from operations $ 11,989,542 $ 1,517,026 $ 12,543,828 $ 15,022,416
------------ ----------- ------------ ------------
Capital transactions --
Contributions $148,348,087 $23,748,943 $187,818,789 $184,212,796
Withdrawals (26,898,325) (1,019,597) (40,614,277) (11,670,041)
------------ ----------- ------------ ------------
Increase in net assets resulting from capital
transactions $121,449,762 $22,729,346 $147,204,512 $172,542,755
------------ ----------- ------------ ------------
Total increase in net assets $133,439,304 $24,246,372 $159,748,340 $187,565,171
NET ASSETS:
At beginning of period 100,020 100,020 100,020 100,020
------------ ----------- ------------ ------------
At end of period $133,539,324 $24,346,392 $159,848,360 $187,665,191
============ =========== ============ ============
</TABLE>
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MINNESOTA NEW JERSEY PENNSYLVANIA TEXAS
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
----------- ------------ ------------ -----------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
From operations --
Net investment income $ 1,988,776 $ 12,599,045 $ 16,036,467 $ 333,755
Net realized gain (loss) on investment transactions (249,985) 108,306 2,426,891 (68,370)
Change in unrealized appreciation (depreciation)
of investments 3,295,330 20,473,018 21,996,791 606,518
----------- ------------ ------------ -----------
Net increase in net assets from operations $ 5,034,121 $ 33,180,369 $ 40,460,149 $ 871,903
----------- ------------ ------------ -----------
Capital transactions --
Contributions $75,312,856 $409,889,770 $536,041,409 $19,000,571
Withdrawals (13,428,138) (49,493,372) (79,600,940) (3,943,128)
----------- ------------ ----------- -----------
Increase in net assets resulting from capital
transactions $61,884,718 $360,396,398 $456,440,469 $15,057,443
----------- ------------ ------------ -----------
Total increase in net assets $66,918,839 $393,576,767 $496,900,618 $15,929,346
NET ASSETS:
At beginning of period 100,020 100,020 100,020 100,020
----------- ------------ ------------ -----------
At end of period $67,018,859 $393,676,787 $497,000,638 $16,029,366
=========== ============ ============ ===========
<FN>
* For the period from the start of business, February 1, 1993, to September 30, 1993.
</TABLE>
See notes to financial statements
66
<PAGE> 36
<TABLE>
- --------------------------------------------------------------------------------
SUPPLEMENTARY DATA
- --------------------------------------------------------------------------------
<CAPTION>
ARIZONA PORTFOLIO COLORADO PORTFOLIO
------------------------------- -------------------------------
YEAR ENDED YEAR ENDED
------------------------------- -------------------------------
JULY 31, JULY 31, SEPT. 30, JULY 31, JULY 31, SEPT. 30,
1995 1994* 1993** 1995 1994* 1993**
-------- -------- --------- -------- -------- ---------
<S> <C> <C> <C> <C> <C> <C>
RATIOS (AS A PERCENTAGE OF AVERAGE
DAILY NET ASSETS)++:
Net expenses 0.52% 0.46%+ 0.42% + 0.25% 0.02% + 0.06%+
Net investment income 5.81% 5.43%+ 5.46% + 6.05% 5.73% + 5.60%+
PORTFOLIO TURNOVER 22% 23% 107% 52% 23% 10%
NET ASSETS, end of period (000 omitted) $144,521 $154,068 $133,539 $46,077 $44,399 $24,346
<FN>
++The operating expenses of the Portfolios may reflect a reduction of the
investment adviser fee and/or allocation of expenses to the Investment
Adviser. Had such actions not been taken, the ratios would have been as
follows:
RATIOS (AS A PERCENTAGE OF AVERAGE DAILY NET ASSETS):
Expenses 0.40% 0.35%+ 0.35%+
Net investment income 5.90% 5.40%+ 5.31%+
</TABLE>
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
CONNECTICUT PORTFOLIO MICHIGAN PORTFOLIO
------------------------------- -------------------------------
YEAR ENDED YEAR ENDED
------------------------------- -------------------------------
JULY 31, JULY 31, SEPT. 30, JULY 31, JULY 31, SEPT. 30,
1995 1994* 1993** 1995 1994* 1993**
-------- -------- --------- -------- -------- ---------
<S> <C> <C> <C> <C> <C> <C>
RATIOS (AS A PERCENTAGE OF AVERAGE
DAILY NET ASSETS):
Net expenses 0.53% 0.47%+ 0.46% + 0.48% 0.47%+ 0.44% +
Net investment income 5.77% 5.40%+ 5.45% + 5.85% 5.48%+ 5.46% +
PORTFOLIO TURNOVER 29% 10% 10% 54% 45% 20%
NET ASSETS, end of period (000 omitted) $195,276 $192,038 $159,848 $191,263 $204,032 $187,665
<FN>
+ Annualized.
* For the ten months ended July 31, 1994 (Note 7).
** For the period from the start of business, February 1, 1993, to September 30, 1993.
</TABLE>
See notes to financial statements
67
<PAGE> 37
- --------------------------------------------------------------------------------
FINANCIAL STATEMENTS (Continued)
<TABLE>
SUPPLEMENTARY DATA
- --------------------------------------------------------------------------------
<CAPTION>
MINNESOTA PORTFOLIO NEW JERSEY PORTFOLIO
------------------------------- -------------------------------
YEAR ENDED YEAR ENDED
------------------------------- -------------------------------
JULY 31, JULY 31, SEPT. 30, JULY 31, JULY 31, SEPT. 30,
1995 1994* 1993** 1995 1994* 1993**
-------- -------- --------- -------- -------- ---------
<S> <C> <C> <C> <C> <C> <C>
RATIOS (AS A PERCENTAGE OF AVERAGE
DAILY NET ASSETS):
Net expenses 0.47% 0.45% + 0.40%+ 0.52% 0.50%+ 0.50% +
Net investment income 5.83% 5.50% + 5.58%+ 5.96% 5.62%+ 5.67% +
PORTFOLIO TURNOVER 76% 20% 10% 54% 25% 12%
NET ASSETS, end of period (000 omitted) $82,968 $84,005 $67,019 $411,038 $423,854 $393,677
</TABLE>
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PENNSYLVANIA PORTFOLIO TEXAS PORTFOLIO
------------------------------- -------------------------------
YEAR ENDED YEAR ENDED
------------------------------- -------------------------------
JULY 31, JULY 31, SEPT. 30, JULY 31, JULY 31, SEPT. 30,
1995 1994* 1993** 1995 1994* 1993**
-------- -------- --------- -------- -------- ---------
<S> <C> <C> <C> <C> <C> <C>
RATIOS (AS A PERCENTAGE OF AVERAGE
DAILY NET ASSETS)++ :
Net expenses 0.49% 0.48%+ 0.50% + 0.08% 0.00% + 0.03%+
Net investment income 6.02% 5.66%+ 5.71% + 6.20% 5.69% + 5.82%+
PORTFOLIO TURNOVER 44% 21% 17% 49% 27% 8%
NET ASSETS, end of period (000 omitted) $502,250 $536,786 $497,001 $28,227 $27,589 $16,029
<FN>
++The operating expenses of the Portfolios may reflect a reduction of the
investment adviser fee and/or allocation of expenses to the Investment
Adviser. Had such actions not been taken, the ratios would have been as
follows:
RATIOS (AS A PERCENTAGE OF AVERAGE DAILY NET ASSETS):
Expenses 0.35% 0.37%+ 0.42%+
Net investment income 5.93% 5.32%+ 5.43%+
+ Annualized.
* For the ten months ended July 31, 1994 (Note 7).
** For the period from the start of business, February 1, 1993, to September 30, 1993.
</TABLE>
See notes to financial statements
68
<PAGE> 38
- --------------------------------------------------------------------------------
Notes to Financial Statements
- --------------------------------------------------------------------------------
(1) SIGNIFICANT ACCOUNTING POLICIES
Arizona Tax Free Portfolio (Arizona Portfolio), Colorado Tax Free Portfolio
(Colorado Portfolio), Connecticut Tax Free Portfolio (Connecticut Portfolio),
Michigan Tax Free Portfolio (Michigan Portfolio), Minnesota Tax Free Portfolio
(Minnesota Portfolio), New Jersey Tax Free Portfolio (New Jersey Portfolio),
Pennsylvania Tax Free Portfolio (Pennsylvania Portfolio) and Texas Tax Free
Portfolio (Texas Portfolio), collectively the Portfolios, are registered under
the Investment Company Act of 1940 as non-diversified open-end management
investment companies which were organized as trusts under the laws of the State
of New York on May 1, 1992. The Declarations of Trust permit the Trustees to
issue interests in the Portfolios. The following is a summary of significant
accounting policies of the Portfolios. The policies are in conformity with
generally accepted accounting principles.
A. INVESTMENT VALUATIONS -- Municipal bonds are normally valued on the basis of
valuations furnished by a pricing service. Taxable obligations, if any, for
which price quotations are readily available are normally valued at the mean
between the latest bid and asked prices. Futures contracts listed on commodity
exchanges are valued at closing settlement prices. Short-term obligations,
maturing in sixty days or less, are valued at amortized cost, which approximates
value. Investments for which valuations or market quotations are unavailable are
valued at fair value using methods determined in good faith by or at the
direction of the Trustees.
B. INCOME -- Interest income is determined on the basis of interest accrued,
adjusted for amortization of premium or discount when required for federal
income tax purposes.
C. INCOME TAXES -- The Portfolios are treated as partnerships for Federal tax
purposes. No provision is made by the Portfolios for federal or state taxes on
any taxable income of the Portfolios because each investor in the Portfolios are
ultimately responsible for the payment of any taxes. Since some of the
Portfolios' investors are regulated investment companies that invest all or
substantially all of their assets in the Portfolios, the Portfolios normally
must satisfy the applicable source of income and diversification requirements
(under the Internal Revenue Code) in order for their respective investors to
satisfy them. The Portfolios will allocate at least annually among their
respective investors each investor's distributive share of the Portfolios' net
taxable (if any) and tax-exempt investment income, net realized capital
gains, and any other items of income, gain, loss, deductions or credit. Interest
income received by the Portfolios on investments in municipal bonds, which is
excludable from gross income under the Internal Revenue Code, will retain its
status as income exempt from federal income tax when allocated to each
Portfolio's investors. The portion of such interest, if any, earned on private
activity bonds issued after August 7, 1986, may be considered a tax preference
item for investors.
D. DEFERRED ORGANIZATION EXPENSES -- Costs incurred by a Portfolio in connection
with its organization are being amortized on the straight-line basis over five
years beginning on the date each Portfolio commenced operations.
E. FINANCIAL FUTURES CONTRACTS -- Upon the entering of a financial futures
contract, a Portfolio is required to deposit ("initial margin") either in cash
or securities an amount equal to a certain percentage of the purchase price
indicated in the financial futures contract. Subsequent payments are made or
received by a Portfolio ("margin maintenance") each day, dependent on the daily
fluctuations in the value of the underlying security, and are recorded for book
purposes as unrealized gains or losses by a Portfolio. A Portfolio's investment
in financial futures contracts is designed only to hedge against anticipated
future changes in interest rates. Should interest rates move unexpectedly, the
Portfolio may not achieve the anticipated benefits of the financial futures
contracts and may realize a loss.
F. WHEN-ISSUED AND DELAYED DELIVERY TRANSACTIONS -- The Portfolios may engage in
when-issued and delayed delivery transactions. The Portfolio records when-issued
securities on trade date and maintains security positions such that sufficient
liquid assets will be available to make payments for the securities purchased.
Securities purchased on a when-issued or delayed delivery basis are
marked-to-market daily and begin accruing interest on settlement date.
G. OTHER -- Investment transactions are accounted for on a trade date basis.
69
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NOTES TO FINANCIAL STATEMENTS (Continued)
- --------------------------------------------------------------------------------
<TABLE>
(2) INVESTMENT ADVISER FEE AND OTHER TRANSACTIONS WITH AFFILIATES
The investment adviser fee is earned by Boston Management and Research (BMR), a
wholly-owned subsidiary of Eaton Vance Management (EVM), as compensation for
management and investment advisory services rendered to each Portfolio.
The fee is based upon a percentage of average daily net assets plus a percentage
of gross income (i.e., income other than gains from the sale of securities).
For the year ended July 31, 1995, each Portfolio paid advisory fees as follows:
<CAPTION>
AMOUNT EFFECTIVE RATE*
---------- ----------------
<S> <C> <C>
Arizona $ 629,148 0.42%
Colorado 128,496 0.28%
Connecticut 835,605 0.44%
Michigan 856,258 0.44%
Minnesota 310,489 0.37%
New Jersey 1,944,340 0.47%
Pennsylvania 2,416,419 0.48%
Texas 56,319 0.21%
</TABLE>
To enhance the net income of the Colorado Portfolio and the Texas Portfolio, BMR
made a reduction in its fee in the amount of $69,064 and $56,319, respectively,
and $18,606 of expenses related to the operation of the Texas Portfolio were
allocated to BMR.
Except as to Trustees of the Portfolios who are not members of EVM's or BMR's
organization, officers and Trustees receive remuneration for their services to
the Portfolios out of such investment adviser fee. Investors Bank & Trust
Company (IBT), an affiliate of EVM and BMR, serves as custodian of the
Portfolios. Pursuant to the custodian agreements, IBT receives a fee reduced by
credits which are determined based on the average daily cash balances each
Portfolio maintains with IBT. Certain of the officers and Trustees of the
Portfolios are officers and directors/trustees of the above organizations.
Trustees of the Portfolio that are not affiliated with the Investment Adviser
may elect to defer receipt of all or a percentage of their annual fees in
accordance with the terms of the Trustees Deferred Compensation Plan. For the
year ended July 31, 1995, no significant amounts have been deferred.
* Advisory fees paid as a percentage of average daily net assets.
<TABLE>
- --------------------------------------------------------------------------------
(3) INVESTMENTS
Purchases and sales of investments, other than U.S. Government securities and
short-term obligations, for the year ended July 31, 1995 were as follows:
<CAPTION>
ARIZONA PORTFOLIO COLORADO PORTFOLIO CONNECTICUT PORTFOLIO MICHIGAN PORTFOLIO
------------------- -------------------- ---------------------- ------------------
<S> <C> <C> <C> <C>
Purchases $31,754,220 $ 23,720,614 $ 55,774,738 $101,893,489
Sales 42,996,767 25,026,530 58,525,219 116,259,363
</TABLE>
<TABLE>
<CAPTION>
MINNESOTA PORTFOLIO NEW JERSEY PORTFOLIO PENNSYLVANIA PORTFOLIO TEXAS PORTFOLIO
------------------- -------------------- ---------------------- ------------------
<S> <C> <C> <C> <C>
Purchases $62,647,201 $219,433,205 $220,102,046 $13,166,608
Sales 62,259,757 237,114,073 264,136,096 13,804,505
</TABLE>
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<PAGE> 40
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- --------------------------------------------------------------------------------
<TABLE>
(4) FEDERAL INCOME TAX BASIS OF INVESTMENTS
The cost and unrealized appreciation/depreciation in value of the investments
owned by each Portfolio at July 31, 1995, as computed on a federal income tax
basis, were as follows:
<CAPTION>
ARIZONA COLORADO CONNECTICUT MICHIGAN
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
Aggregate Cost $140,218,111 $ 44,277,269 $192,808,845 $182,066,681
------------ ------------ ------------ ------------
Gross unrealized appreciation $ 6,026,055 $ 1,602,238 $ 3,281,263 $ 6,693,457
Gross unrealized depreciation 2,197,433 442,812 4,835,599 2,233,242
------------ ------------ ------------ ------------
Net unrealized appreciation (depreciation) $ 3,828,622 $ 1,159,426 $(1,554,336) $ 4,460,215
============ ============ =========== ============
</TABLE>
<TABLE>
<CAPTION>
MINNESOTA NEW JERSEY PENNSYLVANIA TEXAS
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
Aggregate Cost $ 78,851,048 $389,842,758 $477,086,127 $ 26,750,393
------------ ------------ ------------ ------------
Gross unrealized appreciation $ 2,866,555 $ 15,128,046 $17,966,732 $ 777,979
Gross unrealized depreciation 296,490 1,485,389 3,985,529 356,481
------------ ------------ ------------ ------------
Net unrealized appreciation $ 2,570,065 $ 13,642,657 $13,981,203 $ 421,498
============ ============ =========== ============
</TABLE>
- --------------------------------------------------------------------------------
(5) LINE OF CREDIT
The Portfolios participate with other portfolios and funds managed by BMR and
EVM in a $120 million unsecured line of credit agreement with a bank. The line
of credit consists of a $20 million committed facility and a $100 million
discretionary facility. Each Portfolio may temporarily borrow up to 5% of its
total assets to satisfy redemption requests or settle transactions. Interest is
charged to each portfolio or fund based on its borrowings at an amount above
either the bank's adjusted certificate of deposit rate, a variable adjusted
certificate of deposit rate, or a federal funds effective rate. In addition, a
fee computed at an annual rate of 1/4 of 1% on the $20 million committed
facility and on the daily unused portion of the $100 million discretionary
facility is allocated among the participating funds and portfolios at the end of
each quarter. The Portfolios did not have any significant borrowings or
allocated fees during the period. For the Connecticut Portfolio, the average
daily loan balance for the year ended July 31, 1995 was $1,583,254 and the
average interest rate was 7.27%. The maximum borrowings outstanding at any point
during the year were $6,997,000. At July 31, 1995, the Arizona Portfolio had a
$903,000 loan outstanding pursuant to this line of credit.
71
<PAGE> 41
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NOTES TO FINANCIAL STATEMENTS (Continued)
- --------------------------------------------------------------------------------
(6) FINANCIAL INSTRUMENTS
The Portfolios regularly trade in financial instruments with off-balance sheet
risk in the normal course of their investing activities to assist in managing
exposure to various market risks. These financial instruments include written
options and futures contracts and may involve, to a varying degree, elements of
risk in excess of the amounts recognized for financial statement purposes.
The notional or contractual amounts of these instruments represent the
investment a Portfolio has in particular classes of financial instruments and
does not necessarily represent the amounts potentially subject to risk. The
measurement of the risks associated with these instruments is meaningful only
when all related and offsetting transactions are considered.
<TABLE>
A summary of obligations under these financial instruments at July 31, 1995 is
as follows:
<CAPTION>
FUTURES
CONTRACTS NET UNREALIZED
PORTFOLIO EXPIRATION DATE CONTRACTS POSITION APPRECIATION
- -------------- ---------------- ------------------------- -------- ---------------
<S> <C> <C> <C> <C>
Arizona 9/95 63 U.S. Treasury Bonds Short $ 48,427
Colorado 9/95 39 U.S. Treasury Bonds Short 29,978
Connecticut 9/95 145 U.S. Treasury Bonds Short 111,459
Michigan 9/95 188 U.S. Treasury Bonds Short 135,699
Minnesota 9/95 40 U.S. Treasury Bonds Short 14,497
New Jersey 9/95 125 U.S. Treasury Bonds Short 45,304
Texas 9/95 28 U.S. Treasury Bonds Short 33,773
</TABLE>
At July 31, 1995 each Portfolio had sufficient cash and/or securities to cover
margin requirements on open futures contracts.
The Pennsylvania Portfolio had no obligations outstanding at July 31, 1995.
- --------------------------------------------------------------------------------
(7) CHANGE IN FISCAL YEAR
The Portfolios changed their fiscal year end from September 30, to July 31,
effective July 31, 1994.
72
<PAGE> 42
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Independent Auditors' Report
- --------------------------------------------------------------------------------
TO THE TRUSTEES AND INVESTORS OF:
ARIZONA TAX FREE PORTFOLIO
COLORADO TAX FREE PORTFOLIO
CONNECTICUT TAX FREE PORTFOLIO
MICHIGAN TAX FREE PORTFOLIO
MINNESOTA TAX FREE PORTFOLIO
NEW JERSEY TAX FREE PORTFOLIO
PENNSYLVANIA TAX FREE PORTFOLIO
TEXAS TAX FREE PORTFOLIO
We have audited the accompanying statements of assets and liabilities, including
the portfolios of investments, of Arizona Tax Free Portfolio, Colorado Tax Free
Portfolio, Connecticut Tax Free Portfolio, Michigan Tax Free Portfolio,
Minnesota Tax Free Portfolio, New Jersey Tax Free Portfolio, Pennsylvania Tax
Free Portfolio and Texas Tax Free Portfolio as of July 31, 1995 , and the
related statements of operations for the year then ended, and the statements of
changes in net assets and the supplementary data for the year ended July 31,
1995 and the ten months ended July 31, 1994 and for the period from the start of
business, February 1, 1993, to September 30, 1993. These financial statements
and supplementary data are the responsibility of the Trusts' management. Our
responsibility is to express an opinion on the financial statements and
supplementary data 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 supplementary
data are free of material misstatement. An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned at July 31,
1995, by correspondence with the custodian and brokers; where replies were not
received from brokers, we performed other audit 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, such financial statements and supplementary data present fairly,
in all material respects, the financial position of Arizona Tax Free Portfolio,
Colorado Tax Free Portfolio, Connecticut Tax Free Portfolio, Michigan Tax Free
Portfolio, Minnesota Tax Free Portfolio, New Jersey Tax Free Portfolio,
Pennsylvania Tax Free Portfolio and Texas Tax Free Portfolio at July 31, 1995,
the results of their operations, the changes in their net assets and their
supplementary data for the respective stated periods in conformity with
generally accepted accounting principles.
DELOITTE & TOUCHE LLP
BOSTON, MASSACHUSETTS
AUGUST 25, 1995
73
<PAGE> 43
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Investment Management
- --------------------------------------------------------------------------------
FUNDS OFFICERS INDEPENDENT TRUSTEES
THOMAS J. FETTER DONALD R. DWIGHT
President President, Dwight Partners, Inc.
Chairman, Newspaper of New
JAMES B. HAWKES England, Inc.
Vice President, Trustee
SAMUEL L. HAYES, III
ROBERT B. MACINTOSH Jacob H. Schiff Professor of
Vice President Investment Banking, Harvard
University Graduate School of
JAMES L. O'CONNOR Business Administration
Treasurer
NORTON H. REAMER
THOMAS OTIS President and Director,
Secretary United Asset Management
Corporation
JOHN L. THORNDIKE
Director, Fiduciary Company
Incorporated
JACK L. TREYNOR
Investment Adviser and Consultant
- --------------------------------------------------------------------------------
PORTFOLIOS OFFICERS JAMES L. O'CONNOR
THOMAS J. FETTER Treasurer
President
THOMAS OTIS
JAMES B. HAWKES Secretary
Vice President, Trustee
INDEPENDENT TRUSTEES
ROBERT B. MACINTOSH DONALD R. DWIGHT
Vice President of Arizona, President, Dwight Partners, Inc.
Colorado, Connecticut, Chairman, Newspaper of New
Michigan, Minnesota, England, Inc.
New Jersey, Pennsylvania
and Texas SAMUEL L. HAYES, III
Tax Free Portfolios Jacob H. Schiff Professor of
Portfolio Manager of Investment Banking, Harvard
Minnesota and New Jersey University Graduate
Tax Free Portfolios School of Business Administration
CYNTHIA J. CLEMSON NORTON H. REAMER
Vice President and President and Director,
Portfolio Manager of United Asset Management
Arizona and Colorado Tax Corporation
Free Portfolios
JOHN L. THORNDIKE
DAVID C. REILLY Director, Fiduciary Company
Vice President and Incorporated
Portfolio Manager of
Pennsylvania Tax Free JACK L. TREYNOR
Portfolio Investment Adviser and Consultant
NICOLE ANDERES
Vice President and
Portfolio Manager of
Connecticut Tax Free
Portfolio
TIMOTHY T. BROWSE
Vice President and
Portfolio Manager of
Michigan and Texas Tax
Free Portfolios
