<PAGE>
Arizona Municipals Portfolio as of January 31, 1999
PORTFOLIO OF INVESTMENTS (Unaudited)
Tax-Exempt Investments -- 100.0%
Ratings Principal
- ------------------ Amount
Standard (000's
Moody's & Poor's omitted) Security Value
- --------------------------------------------------------------------------------
Assisted Living -- 1.8%
- --------------------------------------------------------------------------------
NR NR $1,800 Arizona Health Facilities
Authority, (Care
Institute, Inc.-Mesa),
7.625%, 1/1/26 $ 1,885,788
- --------------------------------------------------------------------------------
$ 1,885,788
- --------------------------------------------------------------------------------
Education -- 3.4%
- --------------------------------------------------------------------------------
NR NR $2,000 Arizona Educational Loan
Marketing Corp., (AMT),
6.30%, 12/1/08 $ 2,167,400
A1 AA 1,250 University of Arizona,
6.25%, 6/1/11 1,364,888
- --------------------------------------------------------------------------------
$ 3,532,288
- --------------------------------------------------------------------------------
Electric Utilities -- 13.0%
- --------------------------------------------------------------------------------
Ba2 BB+ $3,500 Maricopa County, Pollution
Control, 6.375%, 8/15/23 $ 3,677,065
Baa1 A- 4,300 Navajo County, Pollution
Control, 5.875%, 8/15/28 4,408,833
B2 B 1,000 Pima County, IDA, (Tucson
Electric Power Co.),
6.00%, 9/1/29 1,006,050
Baa1 BBB+ 370 Puerto Rico Electric Power
Authority, 7.125%, 7/1/14 381,844
A A+ 1,000 Puerto Rico Telephone
Authority, Variable Rate,
1/1/20(1) 1,120,090
Aa2 AA 2,000 Salt River Project
Agricultural Improvement
and Power District, 5.00%,
1/1/20 2,015,840
Aa2 AA 820 Salt River Project
Agricultural Improvement
and Power District, 6.25%,
1/1/27 882,500
- --------------------------------------------------------------------------------
$ 13,492,222
- --------------------------------------------------------------------------------
Escrowed / Prerefunded -- 15.2%
- --------------------------------------------------------------------------------
NR AAA $1,000 Glendale, IDA, Prerefunded
to 7/1/05, 7.125%, 7/1/20 $ 1,195,080
Baa1 BBB- 1,000 Maricopa County, (Sun
Health Corp.), Prerefunded
to 4/1/02, 8.125%, 4/1/12 1,152,090
NR NR 3,000 Maricopa County, IDA,
(Place Five and The
Greenery), Escrowed to
Maturity, 6.625%, 1/1/27 3,512,910
NR NR 1,250 Maricopa County, IDA,
(Place Five and The
Greenery), Escrowed to
Maturity, 8.625%, 1/1/27 1,654,100
Aaa AAA 7,500 Maricopa County, Single
Family Mortgage, Escrowed
to Maturity, 0.00%, 2/1/16 3,336,600
Aaa AAA 6,500 Phoenix, IDA, Single
Family, Escrowed to
Maturity, 0.00%, 12/1/14 3,109,405
NR AAA 1,500 Puerto Rico, "RIBS",
(AMBAC), Variable Rate,
Prerefunded to 7/1/02,
7/1/15(1)(2) 1,778,085
- --------------------------------------------------------------------------------
$ 15,738,270
- --------------------------------------------------------------------------------
General Obligations -- 3.7%
- --------------------------------------------------------------------------------
Baa1 A $1,125 Puerto Rico, 0.00%, 7/1/17 $ 465,323
NR A 2,000 Tatum Ranch, 6.875%, 7/1/16 2,251,020
Aa3 AA 1,000 Tucson, 5.375%, 7/1/21 1,082,000
- --------------------------------------------------------------------------------
$ 3,798,343
- --------------------------------------------------------------------------------
Hospital -- 4.4%
- --------------------------------------------------------------------------------
NR BBB $1,130 Arizona HFA, (Phoenix
Memorial Hospital),
8.125%, 6/1/12 $ 1,207,947
NR BBB 1,250 Arizona HFA, (Phoenix
Memorial Hospital), 8.20%,
6/1/21 1,338,250
NR NR 1,000 Winslow, IDA, (Winslow
Memorial Hospital), 5.50%,
6/1/22 974,150
Aaa AAA 895 Winslow, IDA, (Winslow
Memorial Hospital), 9.50%,
6/1/22 1,085,393
- --------------------------------------------------------------------------------
$ 4,605,740
- --------------------------------------------------------------------------------
Housing -- 5.1%
- --------------------------------------------------------------------------------
NR A $2,000 Maricopa County, IDA,
(Laguna Point Apartments),
6.75%, 7/1/19 $ 2,179,380
NR NR 1,000 Maricopa County, IDA,
(National Health
Facilities II),
6.375%, 1/1/19 1,016,050
NR AA 1,000 Phoenix, (Woodstone and
Silver Springs
Apartments), (Asset
Guaranty), 6.25%, 4/1/23 1,050,440
NR AAA 1,000 Tempe, IDA, (Quadrangle
Village Apartments),
6.25%, 6/1/26 1,064,680
- --------------------------------------------------------------------------------
$ 5,310,550
- --------------------------------------------------------------------------------
See notes to financial statements
34
<PAGE>
Arizona Municipals Portfolio as of January 31, 1999
PORTFOLIO OF INVESTMENTS (Unaudited) CONT'D
Ratings Principal
- ------------------ Amount
Standard (000's
Moody's & Poor's omitted) Security Value
- --------------------------------------------------------------------------------
Industrial Development Revenue -- 12.6%
- --------------------------------------------------------------------------------
A1 NR $1,000 Casa Grande, Pollution
Control, (Frito Lay,
Inc.), 6.60%, 12/1/10 $ 1,105,060
NR BBB- 2,000 Coconino County, Pollution
Control, (Nevada Power
Co.), (AMT), 5.80%, 11/1/32 2,034,880
Baa2 BBB- 2,000 Gila County, IDA, (Asarco,
Inc.), 5.55%, 1/1/27 1,979,180
A2 A 1,000 Greenlee County, Pollution
Control, (Phelps Dodge
Corp.), 5.45%, 6/1/09 1,058,430
Ba1 BB+ 500 Maricopa County, Pollution
Control, (Public Service
Co.), 5.75%, 11/1/22 498,150
Baa3 BBB- 4,000 Puerto Rico Port
Authority, (American
Airlines), (AMT), 6.25%,
6/1/26 4,295,000
Baa2 AA- 2,000 Yavapai County, IDA,
(Citizens Utilities Co.),
(AMT), 5.45%, 6/1/33 2,077,880
- --------------------------------------------------------------------------------
$ 13,048,580
- --------------------------------------------------------------------------------
Insured-Electric Utilities -- 2.7%
- --------------------------------------------------------------------------------
Aaa AAA $2,505 Pima County, (Irvington
Power), (FGIC), 7.25%,
7/15/10 $ 2,801,492
- --------------------------------------------------------------------------------
$ 2,801,492
- --------------------------------------------------------------------------------
Insured-General Obligations -- 4.3%
- --------------------------------------------------------------------------------
Aaa AAA $2,250 Coconino County, Community
College, (MBIA), 4.50%,
7/1/19 $ 2,147,175
Aaa AAA 1,000 Puerto Rico, Variable
Rate, (FSA), 7/1/20(1) 1,136,250
Aaa AAA 1,000 Puerto Rico, Variable
Rate, (FSA), 7/1/22(1)(2) 1,147,500
- --------------------------------------------------------------------------------
$ 4,430,925
- --------------------------------------------------------------------------------
Insured-Hospital -- 12.0%
- --------------------------------------------------------------------------------
Aaa AAA $2,000 Maricopa County,
(Samaritan Health),
(MBIA), 7.00%, 12/1/16 $ 2,578,280
Aaa AAA 2,000 Maricopa County, Hospital
District No. 1, (FGIC),
6.125%, 6/1/15 2,177,780
Aaa AAA 2,000 Mohave County, (Kingman
Regional Medical Center),
(FGIC), 6.50%, 6/1/15 2,178,440
Aaa AAA 1,000 Pima County, (Carondelet
Health Care Corp.),
(MBIA), 5.25%, 7/1/12 1,092,340
Aaa AAA 1,000 Pima County, (Carondolet
Health Care Corp.),
(MBIA), 5.25%, 7/1/11 1,093,180
Aaa AAA 1,500 Pima County, (Tucson
Medical Center), (MBIA),
6.375%, 4/1/12 1,632,435
Aaa AAA 1,500 Scottsdale, IDA,
(Scottsdale Memorial
Hospital), (AMBAC), 1,675,905
6.125%, 9/1/17
- --------------------------------------------------------------------------------
$ 12,428,360
- --------------------------------------------------------------------------------
Insured-Housing -- 2.6%
- --------------------------------------------------------------------------------
Aaa AAA $2,500 Maricopa County, IDA,
Multifamily, (National
Health Facilities II),
(FSA), 5.50%, 1/1/24 $ 2,693,175
- --------------------------------------------------------------------------------
$ 2,693,175
- --------------------------------------------------------------------------------
Insured-Transportation -- 3.5%
- --------------------------------------------------------------------------------
Aaa AAA $2,500 Phoenix, Civic Improvement
Corp., (FSA), 5.00%, 7/1/25 $ 2,505,300
Aaa AAA 2,500 Puerto Rico Highway and
Transportation Authority,
(AMBAC), 0.00%, 7/1/16 1,116,650
- --------------------------------------------------------------------------------
$ 3,621,950
- --------------------------------------------------------------------------------
Insured-Water and Sewer -- 1.1%
- --------------------------------------------------------------------------------
Aaa AAA $1,000 Chandler, Water and Sewer,
(FGIC), 6.25%, 7/1/13 $ 1,093,610
- --------------------------------------------------------------------------------
$ 1,093,610
- --------------------------------------------------------------------------------
Miscellaneous Health Care -- 1.0%
- --------------------------------------------------------------------------------
NR NR $1,000 Coconino County, IDA,
Health Care Insurance,
(Guidance Center, Inc.),
5.80%, 6/1/11 $ 1,006,790
- --------------------------------------------------------------------------------
$ 1,006,790
- --------------------------------------------------------------------------------
Pooled Loans -- 3.7%
- --------------------------------------------------------------------------------
Aa2 NR $2,000 Arizona Educational Loan
Marketing Corp., (AMT),
6.25%, 6/1/06 $ 2,228,440
A NR 1,500 Arizona Student Loan
Acquisition Authority,
(AMT), 7.625%, 5/1/10 1,659,255
- --------------------------------------------------------------------------------
$ 3,887,695
- --------------------------------------------------------------------------------
See notes to financial statements
35
<PAGE>
Arizona Municipals Portfolio as of January 31, 1999
PORTFOLIO OF INVESTMENTS (Unaudited) CONT'D
Ratings Principal
- ------------------ Amount
Standard (000's
Moody's & Poor's omitted) Security Value
- --------------------------------------------------------------------------------
Special Tax Revenue -- 1.9%
- --------------------------------------------------------------------------------
NR AAA $2,000 Puerto Rico Infrastructure
Financing Authority,
7.01%, 7/1/28(1) $ 2,009,840
- --------------------------------------------------------------------------------
$ 2,009,840
- --------------------------------------------------------------------------------
Water and Sewer -- 8.0%
- --------------------------------------------------------------------------------
Aa1 AA+ $2,000 Arizona Wastewater
Management Authority,
6.80%, 7/1/11 $ 2,226,280
A1 AA- 1,000 Central Arizona Water
Conservation District,
5.50%, 11/1/09 1,123,030
Aa3 A 1,500 Phoenix, Civic Improvement
Corp., 4.75%, 7/1/23 1,462,890
Aa1 AA 2,500 Scottsdale, Water and
Sewer Revenue, 4.50%,
7/1/20 2,376,125
A1 A+ 1,000 Tuscon, Water Systems,
6.50%, 7/1/16 1,080,990
- --------------------------------------------------------------------------------
$ 8,269,315
- --------------------------------------------------------------------------------
Total Tax-Exempt Investments -- 100.0%
(identified cost $93,999,691) $103,654,933
- --------------------------------------------------------------------------------
AMT-Interest earned from these securities may be considered a tax preference
item for purposes of the Federal Alternative Minimum Tax.
The Portfolio primarily invests 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 January 31, 1999, 27.8% 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 insured by financial institution ranged from 4.4% to 8.2%
of total investments.
(1) Security has been issued as an inverse floater bond.
(2) Security exempt from registration under Rule 144A of the Securities Act of
1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers.
See notes to financial statements
36
<PAGE>
Colorado Municipals Portfolio as of January 31, 1999
PORTFOLIO OF INVESTMENTS (Unaudited)
Tax-Exempt Investments -- 100.0%
Ratings
- ------------------ Principal
Amount
Standard (000's
Moody's & Poor's omitted) Security Value
- --------------------------------------------------------------------------------
Electric Utilities -- 1.4%
- --------------------------------------------------------------------------------
NR BBB $ 500 Guam Power Authority,
6.625%, 10/1/14 $ 554,945
- --------------------------------------------------------------------------------
$ 554,945
- --------------------------------------------------------------------------------
Escrowed / Prerefunded -- 6.4%
- --------------------------------------------------------------------------------
Aaa NR $1,500 Dawson Ridge, Metropolitan
District #1, Escrowed to
Maturity, 0.00%, 10/1/22 $ 428,850
Aaa NR 3,000 Dawson Ridge, Metropolitan
District #1, Escrowed to
Maturity, 0.00%, 10/1/22 857,700
Baa1 BBB+ 1,185 Denver, City And County
Airport Revenue,
Prerefunded to 11/15/02,
(AMT), 6.75%, 11/15/22 1,290,240
- --------------------------------------------------------------------------------
$ 2,576,790
- --------------------------------------------------------------------------------
Hospital -- 25.4%
- --------------------------------------------------------------------------------
NR NR $ 900 Colorado Health Facilities
Authority, (Cleo Wallace
Center), 7.00%, 8/1/15 $ 940,554
NR NR 650 Colorado Health Facilities
Authority, (National Jewish
Center For Immunology),
6.875%, 2/15/12 722,215
Baa1 NR 2,000 Colorado Health Facilities
Authority, (Parkview
Memorial Hospital), 6.125%,
9/1/25 2,116,800
Baa BBB 2,050 Colorado Health Facilities
Authority, (Rocky Mountain
Adventist Healthcare),
6.625%, 2/1/13(1) 2,197,804
NR NR 600 Colorado Health Facilities
Authority, (Steamboat
Springs Health),
5.00%, 9/15/03 617,352
NR NR 500 Colorado Health Facilities
Authority, (Steamboat
Springs Health),
5.30%, 9/15/09 502,390
NR BBB 2,000 Colorado Health Facilities
Authority, (Vail Valley
Medical Center),
6.60%, 1/15/20 2,147,059
Baa2 BBB 1,000 Denver, Health and Hospital
Authority, (Denver Health
Medical Center), 5.375%,
12/1/28 1,000,490
- --------------------------------------------------------------------------------
$10,244,664
- --------------------------------------------------------------------------------
Housing -- 15.3%
- --------------------------------------------------------------------------------
A3 A $1,000 Colorado HFA, 5.35%, 11/1/16 $ 1,032,510
Aa AA 500 Colorado HFA, MFMR, (AMT),
6.40%, 10/1/27 540,535
Aa2 NR 420 Colorado HFA, Single Family
Access Program, 8.00%,
12/1/24 460,131
Aa2 NR 1,000 Colorado HFA, Single Family
Housing, (AMT), 7.55%,
11/1/27 1,142,890
Aa2 NR 410 Colorado HFA, Single Family
Housing, (AMT), 7.65%,
12/1/25 457,048
NR AAA 1,000 Denver, Multifamily
Housing, (Lofts), (FHA),
(AMT), 6.15%, 12/1/16 1,070,210
NR NR 400 Lake Creek, (Affordable
Housing Corp.),
Multifamily, 6.25%, 12/1/23 407,628
NR AAA 1,000 Lakewood, Multifamily
Housing, FHA Insured
Mortgage Loan, (AMT),
6.65%, 10/1/25 1,089,050
- --------------------------------------------------------------------------------
$ 6,200,002
- --------------------------------------------------------------------------------
Industrial Development Revenue -- 11.1%
- --------------------------------------------------------------------------------
Baa3 BB+ $2,000 Denver Airport Special
Facilities, (United
Airlines), (AMT),
6.875%, 10/1/32 $ 2,143,960
A2 NR 1,250 Puerto Rico Industrial,
Medical and Environmental
Pollution Control Facility
Finance Authority,
(American Home Products),
5.10%, 12/1/18 1,250,425
Baa3 BBB- 1,000 Puerto Rico Port Authority,
(American Airlines), (AMT),
6.25%, 6/1/26 1,073,750
- --------------------------------------------------------------------------------
$ 4,468,135
- --------------------------------------------------------------------------------
Insured-Electric Utilities -- 2.2%
- --------------------------------------------------------------------------------
Aaa AAA $ 300 Puerto Rico Electric Power
Authority, "STRIPES",
(FSA), Variable
Rate, 7/1/03(2) $ 349,875
Aaa AAA 500 Puerto Rico Telephone
Authority, (MBIA), Variable
Rate, 1/16/15(2) 542,500
- --------------------------------------------------------------------------------
$ 892,375
- --------------------------------------------------------------------------------
Insured-General Obligations -- 10.8%
- --------------------------------------------------------------------------------
Aaa AAA $1,000 Denver, City and County
School District #1, (FGIC),
5.00%, 12/1/23(3) $ 1,004,170
Aaa AAA 1,750 Eagle, Garfield and Routt
Counties, School District
No. RE 50J, (FGIC), 6.30%,
12/1/12 1,979,040
See notes to financial statements
37
<PAGE>
Colorado Municipals Portfolio as of January 31, 1999
PORTFOLIO OF INVESTMENTS (Unaudited) CONT'D
Ratings
- ------------------ Principal
Amount
Standard (000's
Moody's & Poor's omitted) Security Value
- -------------------------------------------------------------------------------
Insured-General Obligations (continued)
- --------------------------------------------------------------------------------
Aaa AAA $1,160 Highlands Ranch
Metropolitan District No.2,
(FSA), 6.50%, 6/15/10 $ 1,401,048
- --------------------------------------------------------------------------------
$ 4,384,258
- --------------------------------------------------------------------------------
Insured-Housing -- 2.8%
- --------------------------------------------------------------------------------
Aaa AAA $1,000 Thornton, SCA Realty MFMR,
(FSA), 7.10%, 1/1/30 $ 1,114,270
- --------------------------------------------------------------------------------
$ 1,114,270
- --------------------------------------------------------------------------------
Insured-Special Tax Revenue -- 2.7%
- --------------------------------------------------------------------------------
Aaa AAA $1,000 Broomfield Sales and Use
Tax, (AMBAC), 6.30%, 12/1/14 $ 1,088,270
- --------------------------------------------------------------------------------
$ 1,088,270
- --------------------------------------------------------------------------------
Insured-Transportation -- 13.6%
- --------------------------------------------------------------------------------
Aaa AAA $3,500 Colorado Public Highway
Authority Revenue, (MBIA),
0.00%, 9/1/16 $ 1,488,655
Aaa AAA 1,000 Colorado Public Highway
Authority Revenue, (MBIA),
4.75%, 9/1/23 971,000
Aaa AAA 750 Denver, Airport Revenue,
(AMT), (MBIA), 5.75%,
11/15/15 812,205
Aaa AAA 1,000 Denver, Airport Revenue,
(FSA), (AMT), 5.00%,
11/15/25 983,250
Aaa AAA 3,095 Puerto Rico Highway and
Transportation Authority,
(AMBAC), 0.00%, 7/1/18 1,238,898
- --------------------------------------------------------------------------------
$ 5,494,008
- --------------------------------------------------------------------------------
Senior Living / Life Care -- 1.0%
- --------------------------------------------------------------------------------
NR NR $ 400 Colorado HFA, Revenue
Refunding and Improvement,
(Volunteers), 5.875%, 7/1/28 $ 399,976
- --------------------------------------------------------------------------------
$ 399,976
- --------------------------------------------------------------------------------
Transportation -- 4.6%
- --------------------------------------------------------------------------------
NR NR $ 500 Eagle County, (Eagle County
Airport Terminal), (AMT),
7.50%, 5/1/21 $ 544,020
Baa1 A 250 Puerto Rico Highway and
Transportation Authority,
5.00%, 7/1/36 251,583
Baa1 A 1,000 Puerto Rico Highway and
Transportation Authority,
5.50%, 7/1/36 1,072,770
- --------------------------------------------------------------------------------
$ 1,868,373
- --------------------------------------------------------------------------------
Water and Sewer -- 2.7%
- --------------------------------------------------------------------------------
NR NR $1,000 Cottonwood Water and
Sanitation District, 7.75%,
12/1/20 $ 1,082,860
- --------------------------------------------------------------------------------
$ 1,082,860
- --------------------------------------------------------------------------------
Total Tax-Exempt Investments -- 100.0%
(identified cost $36,958,252) $40,368,926
- --------------------------------------------------------------------------------
AMT - Interest earned from these securities may be considered a tax preference
item for purposes of the Federal Alternative Minimum Tax.
The portfolio invests primarily in debt securities issued by Colorado
municipalities. The ability of the issuers of the debt securities to meet
their obligations may be affected by the economic developments in a
specific industry or municipality. In order to reduce the risk associated
with such economic developments, at January 31, 1999, 32.1% 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 insured by financial institutions ranged from 5.8% to
9.5% of total investments.
(1) Security (or a portion thereof) has been segregated to cover when-issued
securities.
(2) Security has been issued as an inverse floater bond.
(3) When-issued security.
See notes to financial statements
38
<PAGE>
Connecticut Municipals Portfolio as of January 31, 1999
PORTFOLIO OF INVESTMENTS (Unaudited)
Tax-Exempt Investments -- 100.0%
Ratings
- ------------------ Principal
Amount
Standard (000's
Moody's & Poor's omitted) Security Value
- --------------------------------------------------------------------------------
Cogeneration -- 4.9%
- --------------------------------------------------------------------------------
NR BBB+ $8,000 Eastern Connecticut
Resource Recovery
Authority, (Wheelabrator
Lisbon), (AMT), 5.50%,
1/1/20 $ 7,978,880
- --------------------------------------------------------------------------------
$ 7,978,880
- --------------------------------------------------------------------------------
Education -- 9.7%
- --------------------------------------------------------------------------------
NR BBB- $4,775 Connecticut HEFA,
(Quinnipiac College),
6.00%, 7/1/23 $ 5,000,953
Baa3 BBB- 1,000 Connecticut HEFA, (Sacred
Heart University), 5.80%,
7/1/23 1,103,860
Ba1 BBB- 5,500 Connecticut HEFA,
(University of Hartford),
6.80%, 7/1/22 5,838,800
Aaa AAA 3,400 Connecticut HEFA, (Yale
University), Variable
Rate, 6/10/30(1) 3,880,250
- --------------------------------------------------------------------------------
$ 15,823,863
- --------------------------------------------------------------------------------
Electric Utilities -- 10.1%
- --------------------------------------------------------------------------------
Ba3 B+ $1,500 Connecticut State
Development Authority,
(Western Massachusetts
Electric Co.), 5.85%,
9/1/28 $ 1,505,610
NR BBB 3,625 Guam Power Authority,
6.30%, 10/1/22 3,888,030
NR BBB 1,100 Guam Power Authority,
6.625%, 10/1/14 1,220,879
Baa1 BBB+ 4,000 Puerto Rico Electric Power
Authority, 4.75%, 7/1/24 3,865,200
Baa1 BBB+ 2,500 Puerto Rico Electric Power
Authority, 5.00%, 7/1/28 2,490,350
NR NR 3,220 Virgin Islands Water and
Power Authority, 7.40%,
7/1/11 3,541,517
- --------------------------------------------------------------------------------
$ 16,511,586
- --------------------------------------------------------------------------------
Escrowed / Prerefunded -- 1.1%
- --------------------------------------------------------------------------------
NR A $1,000 Connecticut HEFA, (Sacred
Heart University),
Prerefunded to 7/01/02,
6.80%, 7/1/12 $ 1,123,110
NR AA 650 Connecticut State,
Prerefunded to 7/15/00,
6.875%, 7/15/10 697,333
- --------------------------------------------------------------------------------
$ 1,820,443
- --------------------------------------------------------------------------------
General Obligations -- 3.3%
- --------------------------------------------------------------------------------
Aa3 AA $1,750 Connecticut State,
0.00%, 11/1/09 $ 1,120,315
Aa2 AA 1,270 Danbury, 4.50%, 2/1/14 1,277,582
NR BBB 500 Guam, 5.40%, 11/15/18 507,250
Baa1 A 1,065 Puerto Rico, Public
Improvement, 0.00%, 7/1/15 494,235
Baa1 A 2,000 Puerto Rico, Public
Improvement, 5.00%, 7/1/27 1,992,400
- --------------------------------------------------------------------------------
$ 5,391,782
- --------------------------------------------------------------------------------
Hospital -- 9.7%
- --------------------------------------------------------------------------------
Baa2 NR $5,400 Connecticut HEFA, (Griffin
Hospital), 5.75%, 7/1/23 $ 5,471,064
Baa2 BBB 500 Connecticut HEFA, (Hospital
for Special Care), 5.375%,
7/1/17 499,685
NR AAA 2,000 Connecticut HEFA, (New
Britain Memorial Hospital),
7.75%, 7/1/22 2,309,100
NR NR 1,100 Connecticut HEFA, (William
W. Backus Hospital),
6.00%, 7/1/12 1,203,917
NR NR 5,780 Connecticut HEFA, (William
W. Backus Hospital),
6.375%, 7/1/22 6,395,223
- --------------------------------------------------------------------------------
$ 15,878,989
- --------------------------------------------------------------------------------
Housing -- 5.0%
- --------------------------------------------------------------------------------
Aa2 AA $1,545 Connecticut HFA, MRB,
6.35%, 5/15/17 $ 1,657,893
Aa2 AA 210 Connecticut HFA, MRB,
6.55%, 11/15/13 226,632
Aa2 AA 1,515 Connecticut HFA, MRB,
6.60%, 11/15/23 1,632,094
Aa AA 15 Connecticut HFA, MRB,
7.625%, 11/15/17 15,197
Aa2 AA 4,300 Connecticut HFA, MRB,
(AMT), 6.20%, 11/15/22 4,613,341
- --------------------------------------------------------------------------------
$ 8,145,157
- --------------------------------------------------------------------------------
Industrial Development Revenue -- 4.6%
- --------------------------------------------------------------------------------
Aaa AAA $1,000 Connecticut Development
Authority PCR, (Pfizer,
Inc.), 6.55%, 2/15/13 $ 1,101,880
NR NR 3,065 Connecticut Development
Authority, Airport
Facility, (Signature
Flight), (AMT), 6.625%,
12/1/14 3,275,228
Ba3 B+ 1,500 Connecticut State
Development Authority,
Pollution Control Revenue,
(Connecticut Light and
Power), (AMT), 5.95%,
9/1/28 1,505,565
See notes to financial statements
39
<PAGE>
Connecticut Municipals Portfolio as of January 31, 1999
PORTFOLIO OF INVESTMENTS (Unaudited) CONT'D
Ratings
- ------------------ Principal
Amount
Standard (000's
Moody's & Poor's omitted) Security Value
- --------------------------------------------------------------------------------
Industrial Development Revenue (continued)
- --------------------------------------------------------------------------------
Baa3 BBB- $ 400 Puerto Rico Port
Authority, (American
Airlines), (AMT), 6.25%,
6/1/26 $ 429,500
A3 BBB+ 1,200 Sprague, Environmental
Improvement, (International
Paper Co.), (AMT), 5.70%,
10/1/21 1,234,212
- --------------------------------------------------------------------------------
$ 7,546,385
- --------------------------------------------------------------------------------
Insured-Education -- 4.3%
- --------------------------------------------------------------------------------
Aaa AAA $3,000 Connecticut HEFA, (Choate
Rosemary College), (MBIA),
5.00%, 7/1/27 $ 3,014,430
Aaa AAA 1,555 Connecticut HEFA, (Choate
Rosemary College), (MBIA),
6.80%, 7/1/15 1,804,640
Aaa AAA 2,000 Connecticut HEFA, (Trinity
College), (MBIA), 5.50%,
7/1/21 2,204,020
- --------------------------------------------------------------------------------
$ 7,023,090
- --------------------------------------------------------------------------------
Insured-General Obligations -- 1.3%
- --------------------------------------------------------------------------------
Aaa AAA $1,000 New Britain, (MBIA),
6.00%, 3/1/12 $ 1,168,220
Aaa AAA 1,000 Puerto Rico, (MBIA),
5.375%, 7/1/25 1,038,360
- --------------------------------------------------------------------------------
$ 2,206,580
- --------------------------------------------------------------------------------
Insured-Hospital -- 7.1%
- --------------------------------------------------------------------------------
Aaa AAA $1,000 Connecticut HEFA,
(Bridgeport Hospital),
(MBIA), 6.625%, 7/1/18 $ 1,100,430
Aaa AAA 1,000 Connecticut HEFA, (Danbury
Hospital), (AMBAC),
5.375%, 7/1/17 1,037,250
Aaa AAA 1,000 Connecticut HEFA,
(Hospital of St. Raphael),
(AMBAC), 6.50%, 7/1/11 1,215,920
Aaa AAA 1,500 Connecticut HEFA,
(Hospital of St. Raphael),
(AMBAC), 6.625%, 7/1/14 1,621,410
Aaa AAA 2,350 Connecticut HEFA,
(Lawrence and Memorial
Hospital), (MBIA),
5.00%, 7/1/22 2,335,477
Aaa AAA 2,000 Connecticut HEFA,
(Veterans Memorial Medical
Center), (MBIA), 5.375%,
7/1/15 2,121,280
Aaa AAA 2,000 Connecticut HEFA,
(Yale-New Haven Hospital),
(MBIA), 6.50%, 7/1/12 2,189,580
- --------------------------------------------------------------------------------
$ 11,621,347
- --------------------------------------------------------------------------------
Insured-Housing -- 0.2%
- --------------------------------------------------------------------------------
NR AA $ 305 Puerto Rico Housing
Finance Corp., (AMBAC),
7.50%, 10/1/11 $ 314,775
- --------------------------------------------------------------------------------
$ 314,775
- --------------------------------------------------------------------------------
Insured-Transportation -- 5.9%
- --------------------------------------------------------------------------------
Aaa AAA $8,200 Connecticut State, Airport
Revenue, (Bradley
International), (FGIC),
7.65%, 10/1/12 $ 9,720,772
- --------------------------------------------------------------------------------
$ 9,720,772
- --------------------------------------------------------------------------------
Nursing Home -- 13.8%
- --------------------------------------------------------------------------------
NR NR $1,240 Connecticut Development
Authority, (Baptist
Homes), 9.00%, 9/1/22 $ 1,386,060
A2 NR 7,000 Connecticut Development
Authority, Health Care
Bonds, (Duncaster), 6.75%,
9/1/15 7,673,540
A1 AA- 720 Connecticut HEFA, (NHP),
(Highland View), (AMT),
7.00%, 11/1/07 840,456
A1 AA- 1,305 Connecticut HEFA, (NHP),
(Sharon Healthcare),
6.25%, 11/1/14 1,462,031
A1 AA- 655 Connecticut HEFA, (NHP),
(St. Camillus), 6.25%,
11/1/18 725,989
A1 AA- 3,250 Connecticut HEFA, (NHP),
(St. Joseph's Manor),
6.25%, 11/1/16 3,644,648
A1 AA- 335 Connecticut HEFA, (NHP),
(Wadsworth Glen), (AMT),
7.00%, 11/1/07 391,046
A1 AA- 2,000 Connecticut HEFA, (NHP),
(Wadsworth Glen), (AMT),
7.50%, 11/1/16 2,375,280
A1 AA- 3,000 Connecticut HEFA, (NHP),
(Windsor), 7.125%, 11/1/14 3,573,180
A1 AA- 500 Connecticut HEFA, (NHP),
(Windsor), 7.125%, 11/1/24 595,530
- --------------------------------------------------------------------------------
$ 22,667,760
- --------------------------------------------------------------------------------
See notes to financial statements
40
<PAGE>
Connecticut Municipals Portfolio as of January 31, 1999
PORTFOLIO OF INVESTMENTS (Unaudited) CONT'D
Ratings
- ------------------ Principal
Amount
Standard (000's
Moody's & Poor's omitted) Security Value
- --------------------------------------------------------------------------------
Solid Waste -- 4.4%
- --------------------------------------------------------------------------------
A2 NR $2,500 Bristol Resource Recovery
Facility, (Ogden Martin
Systems),
6.50%, 7/1/14 $ 2,753,925
Baa1 A- 4,250 Connecticut Resources
Recovery Authority,
(American REF-FUEL Co.),
(AMT), 6.45%, 11/15/22 4,536,748
- --------------------------------------------------------------------------------
$ 7,290,673
- --------------------------------------------------------------------------------
Special Tax Revenue -- 4.1%
- --------------------------------------------------------------------------------
A1 AA- $3,180 Connecticut State, (STOB),
6.125%, 9/1/12 $ 3,745,404
A1 AA- 2,000 Connecticut State, (STOB),
6.50%, 10/1/12 2,449,980
Baa1 A 500 Puerto Rico Highway and
Transportation Authority,
5.50%, 7/1/15 550,540
- --------------------------------------------------------------------------------
$ 6,745,924
- --------------------------------------------------------------------------------
Student Loans -- 2.4%
- --------------------------------------------------------------------------------
A1 NR $1,140 Connecticut Higher
Education Supplemental
Loan Authority Revenue
Bonds, (AMT),
6.20%, 11/15/09 $ 1,213,313
A1 NR 375 Connecticut Higher
Education Supplemental
Loan Authority Revenue
Bonds, (AMT),
7.375%, 11/15/05 383,306
A1 NR 2,345 Connecticut Higher
Education Supplemental
Loan Authority Revenue
Bonds, (AMT),
7.50%, 11/15/10 2,397,340
- --------------------------------------------------------------------------------
$ 3,993,959
- --------------------------------------------------------------------------------
Transportation -- 7.2%
- --------------------------------------------------------------------------------
Baa1 A $1,020 Puerto Rico Highway and
Transportation Authority,
4.75%, 7/1/38 $ 989,043
Baa1 A- 2,350 Puerto Rico Highway and
Transportation Authority,
5.00%, 7/1/22 2,338,673
Baa1 A 3,680 Puerto Rico Highway and
Transportation Authority,
5.00%, 7/1/38 3,639,189
Baa1 A 4,465 Puerto Rico Highway and
Transportation Authority,
5.50%, 7/1/15 4,916,322
- --------------------------------------------------------------------------------
$ 11,883,227
- --------------------------------------------------------------------------------
Water and Sewer -- 0.9%
- --------------------------------------------------------------------------------
Aaa AAA $1,250 Connecticut State, Clean
Water Fund, 6.00%, 10/1/12 $ 1,474,275
- --------------------------------------------------------------------------------
$ 1,474,275
- --------------------------------------------------------------------------------
Total Tax-Exempt Investments -- 100.0%
(identified cost $151,365,923) $164,039,467
- --------------------------------------------------------------------------------
AMT -- Interest earned from these securities may be considered a tax preference
item for purposes of the Federal Alternative Minimum Tax.
The portfolio invests primarily in debt securities issued by Connecticut
municipalities. The ability of the issuers of the debt securities to meet
their obligations may be affected by the economic developments in a
specific industry or municipality. In order to reduce the risk associated
with such economic developments, at January 31, 1999, 18.8% 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 2.5% to 10.3% of
total investments.
(1) Security has been issued as an inverse floater bond.
See notes to financial statements
41
<PAGE>
Michigan Municipals Portfolio as of January 31, 1999
PORTFOLIO OF INVESTMENTS (Unaudited)
Tax-Exempt Investments -- 100.0%
Ratings
- ------------------ Principal
Amount
Standard (000's
Moody's & Poor's omitted) Security Value
- --------------------------------------------------------------------------------
Electric Utilities -- 3.3%
- --------------------------------------------------------------------------------
NR BBB $1,000 Guam Power Authority,
6.625%, 10/1/14 $ 1,109,890
Baa1 BBB 500 Michigan South Central
Power Agency Supply
System, 6.75%, 11/1/10 538,935
Baa1 BBB+ 2,000 Puerto Rico Electric Power
Authority, 4.75%, 7/1/24 1,932,600
Baa1 BBB+ 365 Puerto Rico Electric Power
Authority, 7.125%, 7/1/14 376,684
- --------------------------------------------------------------------------------
$ 3,958,109
- --------------------------------------------------------------------------------
Escrowed / Prerefunded -- 2.6%
- --------------------------------------------------------------------------------
Aaa AAA $1,000 Lake Orion School
District, Prerefunded to
5/1/05, (AMBAC), 7.00%,
5/1/20 $ 1,186,650
NR NR 1,770 Michigan Strategic
Environmental Research
Institute, Prerefunded to
8/15/02, 6.375%, 8/15/12 1,942,363
- --------------------------------------------------------------------------------
$ 3,129,013
- --------------------------------------------------------------------------------
General Obligations -- 7.0%
- --------------------------------------------------------------------------------
Aa2 AA+ $ 500 Avondale School District,
School Building and Site,
6.75%, 5/1/14 $ 537,560
Baa1 BBB+ 5,115 Detroit, 6.35%, 4/1/14 5,569,160
Aaa BBB+ 500 Detroit, 6.70%, 4/1/10 581,390
Aa2 AA+ 1,000 Mattawan Consolidated
Schools, 6.40%, 5/1/09 1,102,280
Baa1 A 500 Puerto Rico, 0.00%, 7/1/16 219,560
Baa1 A 700 Puerto Rico, 0.00%, 7/1/18 274,939
- --------------------------------------------------------------------------------
$ 8,284,889
- --------------------------------------------------------------------------------
Hospital -- 6.5%
- --------------------------------------------------------------------------------
NR BBB $2,000 Michigan HFA, (Central
Michigan Community
Hospital), 6.25%, 10/1/27 $ 2,119,640
Aa3 AA- 250 Michigan HFA, (Henry Ford
Continuing Care Corp.),
6.75%, 7/1/11 271,133
A1 NR 6,000 Michigan HFA, (McLaren
Obligated Group), 4.50%,
10/15/21 5,380,919
- --------------------------------------------------------------------------------
$ 7,771,692
- --------------------------------------------------------------------------------
Housing-- 1.3%
- --------------------------------------------------------------------------------
NR AA- $ 495 Michigan HDA, Rental
Housing, (AMT), 7.15%,
4/1/10 $ 531,863
NR AA+ 940 Michigan HDA, SFMR, (AMT),
6.20%, 12/1/27 1,010,697
- --------------------------------------------------------------------------------
$ 1,542,560
- --------------------------------------------------------------------------------
Industrial Development Revenue -- 12.4%
- --------------------------------------------------------------------------------
Baa1 BBB $2,000 Dickinson, PCR, (Champion
International), 5.85%,
10/1/18 $ 2,069,200
NR B+ 1,000 Michigan Strategic Fund,
(Crown Paper), (AMT),
6.50%, 8/1/21 909,470
A2 A 3,970 Michigan Strategic Fund,
(General Motors Corp.),
6.20%, 9/1/20 4,309,276
NR BB 110 Michigan Strategic Fund,
(KMart Corp.), 6.80%,
12/15/07 116,497
NR NR 3,000 Michigan Strategic Fund,
(S.D. Warren Co.), (AMT),
7.375%, 1/15/22 3,319,020
Baa3 BBB- 2,750 Puerto Rico Port
Authority, (American
Airlines), (AMT), 6.25%,
6/1/26 2,952,813
Baa3 BBB- 490 Puerto Rico Port
Authority, (American
Airlines), (AMT), 6.30%,
6/1/23 521,154
NR BB 530 Richmond EDC, (KMart
Corp.), 6.625%, 1/1/07 568,467
- --------------------------------------------------------------------------------
$ 14,765,897
- --------------------------------------------------------------------------------
Insured-Education -- 10.1%
- --------------------------------------------------------------------------------
Aaa AAA $ 675 Central Michigan
University, (FGIC), 5.00%,
10/1/27 $ 673,427
Aaa AAA 2,870 Eastern Michigan
University, (FGIC), 5.50%,
6/1/27 3,020,503
Aaa AAA 4,000 Ferris State University,
(AMBAC), 5.00%, 10/1/28 3,990,520
Aaa AAA 2,750 Ferris State University,
(MBIA), 5.25%, 10/1/20 2,804,588
Aaa AAA 1,000 Michigan State
University-Grand Valley,
(MBIA), 5.25%, 10/1/17 1,034,820
Aaa AAA 500 Western Michigan
University, (AMBAC),
6.50%, 7/15/21 541,585
- --------------------------------------------------------------------------------
$ 12,065,443
- --------------------------------------------------------------------------------
Insured-Electric Utilities -- 4.9%
- --------------------------------------------------------------------------------
Aaa AAA $ 300 Michigan Strategic Fund,
(Detroit Edison Co.),
(FGIC), 6.95%, 5/1/11 $ 375,582
See notes to financial statements
42
<PAGE>
Michigan Municipals Portfolio as of January 31, 1999
PORTFOLIO OF INVESTMENTS (Unaudited) CONT'D
Ratings
- ------------------ Principal
Amount
Standard (000's
Moody's & Poor's omitted) Security Value
- --------------------------------------------------------------------------------
Insured-Electric Utilities (continued)
- --------------------------------------------------------------------------------
Aaa AAA $4,000 Michigan Strategic Fund,
(Detroit Edison Co.),
(FGIC), 6.95%, 9/1/21 $ 4,370,400
Aaa AAA 550 Monroe County, PCR,
(Detroit Edison Co.),
(FGIC), (AMT),
7.65%, 9/1/20 592,444
Aaa AAA 500 Puerto Rico Electric Power
Authority, (FSA), 4.75%,
7/1/21 491,515
- --------------------------------------------------------------------------------
$ 5,829,941
- --------------------------------------------------------------------------------
Insured-General Obligations -- 20.6%
- --------------------------------------------------------------------------------
Aaa AAA $2,000 Detroit School District,
(FGIC), 4.75%, 5/1/28 $ 1,930,880
Aaa AAA 500 Detroit, (FGIC), 5.50%,
4/1/16 528,155
Aaa AAA 1,000 Grand Ledge School
District, (MBIA), 5.375%,
5/1/24 1,032,200
Aaa AAA 1,900 Holland School District,
(AMBAC), 0.00%, 5/1/17 778,183
Aaa AAA 2,000 Kalamazoo, (MBIA),
5.40%, 5/1/14 2,193,500
Aaa AAA 1,000 Lake Shore Public Schools,
Macomb County, (FSA),
5.50%, 5/1/17 1,051,690
Aaa AAA 2,000 Lincoln Park School
District, (FGIC), 5.00%,
5/1/20 2,000,520
Aaa AAA 1,500 Lincoln Park School
District, (FGIC), 5.90%,
5/1/26 1,703,805
Aaa AAA 2,000 Lincon, Consolidated
School District, (FSA),
5.00%, 5/1/28 1,992,220
Aaa AAA 1,000 Michigan State Truck Line,
(MBIA), 5.00%, 11/1/26 997,690
Aaa AAA 2,410 Okemos Public Schools,
(MBIA), 0.00%, 5/1/16 1,048,808
Aaa AAA 1,370 Parchment School District,
(MBIA), 5.00%, 5/1/25 1,405,373
Aaa AAA 4,740 South Redford School
District, (FGIC), 5.50%,
5/1/22 5,059,997
Aaa AAA 2,750 Ypsilanti School District,
(FGIC), 5.375%, 5/1/26 2,838,550
- --------------------------------------------------------------------------------
$ 24,561,571
- --------------------------------------------------------------------------------
Insured-Hospital -- 4.2%
- --------------------------------------------------------------------------------
Aaa NR $ 900 Kalamazoo HFA, (Bronson
Methodist Hospital),
(MBIA), 5.50%, 5/15/28 $ 945,945
Aaa AAA 3,500 Kent HFA, (Butterworth
Health System), (MBIA),
6.125%, 1/15/16 4,023,040
- --------------------------------------------------------------------------------
$ 4,968,985
- --------------------------------------------------------------------------------
Insured-Housing -- 2.3%
- --------------------------------------------------------------------------------
Aaa AAA $ 500 Michigan HDA, (Parkway
Meadows), (FSA), 6.85%,
10/15/18 $ 541,280
Aaa AAA 2,075 Michigan HDA, SFMR,
(AMBAC), (AMT), 6.05%,
12/1/27 2,209,377
- --------------------------------------------------------------------------------
$ 2,750,657
- --------------------------------------------------------------------------------
Insured-Senior Living / Life Care -- 2.8%
- --------------------------------------------------------------------------------
Aaa AAA $2,200 Hancock HFA, (Portage
Health), (MBIA), 5.45%,
8/1/47 $ 2,269,982
Aaa AAA 1,000 Michigan State HFA,
(Midmichigan Obligation
Group), (FSA), 5.375%,
6/1/27 1,029,750
- --------------------------------------------------------------------------------
$ 3,299,732
- --------------------------------------------------------------------------------
Insured-Transportation -- 3.3%
- --------------------------------------------------------------------------------
Aaa AAA $4,000 Wayne Charter County,
Airport Revenue, Detroit
Metropolitan Wayne County
Airport, (MBIA),(AMT),
5.00%, 12/1/28 $ 3,911,760
- --------------------------------------------------------------------------------
$ 3,911,760
- --------------------------------------------------------------------------------
Insured-Water and Sewer -- 4.1%
- --------------------------------------------------------------------------------
Aaa AAA $5,000 Detroit, City Water Supply
System, (FGIC), 4.75%,
7/1/19 $ 4,875,350
- --------------------------------------------------------------------------------
$ 4,875,350
- --------------------------------------------------------------------------------
Miscellaneous -- 1.3%
- --------------------------------------------------------------------------------
NR NR $1,500 Pittsfield Township EDC,
(Arbor Hospice), 7.875%,
8/15/27 $ 1,592,610
- --------------------------------------------------------------------------------
$ 1,592,610
- --------------------------------------------------------------------------------
Pooled Loans -- 2.2%
- --------------------------------------------------------------------------------
NR A $1,825 Michigan Municipal Bond
Authority Local Government
Loan, 6.75%, 5/1/12 $ 2,024,637
NR A 590 Michigan Municipal Bond
Authority Local Government
Loan, 6.90%, 5/1/21 643,377
- --------------------------------------------------------------------------------
$ 2,668,014
- --------------------------------------------------------------------------------
Senior Living / Life Care -- 2.2%
- --------------------------------------------------------------------------------
NR BBB $1,500 Kalamazoo EDC, (Friendship
Village), 6.25%, 5/15/27 $ 1,587,390
See notes to financial statements
43
<PAGE>
Michigan Municipals Portfolio as of January 31, 1999
PORTFOLIO OF INVESTMENTS (Unaudited) CONT'D
Ratings
- ------------------ Principal
Amount
Standard (000's
Moody's & Poor's omitted) Security Value
- --------------------------------------------------------------------------------
Senior Living / Life Care (continued)
- -------------------------------------------------------------------------------
NR NR $1,000 Michigan HFA,
(Presbyterian Village),
6.50%, 1/1/25 $ 1,075,410
- --------------------------------------------------------------------------------
$ 2,662,800
- --------------------------------------------------------------------------------
Special Tax Revenue -- 8.1%
- --------------------------------------------------------------------------------
NR BBB+ $ 250 Battle Creek, Downtown
Development Authority Tax
Increment, 7.60%, 5/1/16 $ 298,755
NR BBB+ 1,315 Battle Creek, Downtown
Development Authority Tax
Increment, 7.65%, 5/1/22 1,574,555
NR A 4,300 Detroit, (Convention
Facility Cobo Hall
Expansion), 5.25%, 9/30/12(1) 4,418,895
NR A- 3,050 Detroit, Downtown Tax
Increment, 0.00%, 7/1/16 1,217,743
NR A- 2,000 Detroit, Downtown Tax
Increment, 0.00%, 7/1/20 632,080
A3 A+ 1,500 Detroit, Local Development
Finance Authority, 5.375%,
5/1/21 1,548,840
- --------------------------------------------------------------------------------
$ 9,690,868
- --------------------------------------------------------------------------------
Water and Sewer -- 0.8%
- --------------------------------------------------------------------------------
Aa1 AA+ $1,000 Michigan Municipal Bond
Authority, (Clean Water
Revolving Fund), 4.75%,
10/1/18 $ 984,240
- --------------------------------------------------------------------------------
$ 984,240
- --------------------------------------------------------------------------------
Total Tax-Exempt Investments -- 100.0%
(identified cost $108,964,494) $119,314,131
- --------------------------------------------------------------------------------
AMT - Interest earned from these securities may be considered a tax preference
item for purposes of the Federal Alternative Minimum Tax.
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 the economic developments in a
specific industry or municipality. In order to reduce the risk associated
with such economic developments, at January 31, 1999, 53.3% 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 insured by financial institution ranged from 3.9% to
19.9%.
(1) Security (or a portion thereof) has been segregated to cover margin
requirements on open financial futures contracts.
See notes to financial statements
44
<PAGE>
Minnesota Municipals Portfolio as of January 31, 1999
PORTFOLIO OF INVESTMENTS (Unaudited)
Tax-Exempt Investments -- 100.0%
Ratings
- ------------------ Principal
Amount
Standard (000's
Moody's & Poor's omitted) Security Value
- --------------------------------------------------------------------------------
Assisted Living -- 1.8%
- --------------------------------------------------------------------------------
NR NR $ 1,000 St. Paul, Housing and
Redevelopment, (Care
Institute, Inc.-Highland),
8.75%, 11/1/24 $ 1,154,550
- --------------------------------------------------------------------------------
$ 1,154,550
- --------------------------------------------------------------------------------
Education -- 7.3%
- --------------------------------------------------------------------------------
A2 NR $ 1,000 Hopkins, (Blake School),
5.50%, 9/1/24 $ 1,039,830
A3 NR 500 Minnesota Higher Education
Facilities Authority, (St.
John's University), 5.40%,
10/1/22 518,350
Baa2 NR 500 Minnesota Higher Education
Facilities Authority, (St.
Mary's College), 6.15%,
10/1/23 524,325
A2 NR 1,100 Minnesota Higher Education
Facilities Authority,
(University of St.
Thomas), 5.40%, 4/1/22 1,142,977
A2 NR 1,510 Minnesota Higher Education
Facilities Authority,
(University of St.
Thomas), 5.40%, 4/1/23 1,555,617
- --------------------------------------------------------------------------------
$ 4,781,099
- --------------------------------------------------------------------------------
Escrowed / Prerefunded -- 3.1%
- --------------------------------------------------------------------------------
Aaa AAA $ 1,700 Minnesota State,
Prerefunded to 8/1/02,
Variable Rate, 8/1/11(1) $ 2,006,425
- --------------------------------------------------------------------------------
$ 2,006,425
- --------------------------------------------------------------------------------
General Obligations -- 2.9%
- --------------------------------------------------------------------------------
Aaa AAA $ 200 Minneapolis and St. Paul,
Airports Commission,
(AMT), 6.60%, 1/1/09 $ 215,228
Aaa AAA 300 Minneapolis and St. Paul,
Airports Commission,
(AMT), 6.60%, 1/1/10 322,413
Aaa AAA 1,000 Minnesota State, (Duluth
Airport), (AMT), 6.25%,
8/1/14 1,111,730
A1 AA- 200 St. Cloud, Variable
Rate, 8/1/13(1) 227,750
- --------------------------------------------------------------------------------
$ 1,877,121
- --------------------------------------------------------------------------------
Hospital -- 15.5%
- --------------------------------------------------------------------------------
Baa1 A- $ 1,250 Minneapolis and St. Paul,
Housing and Redevelopment
Authority, (Group Health
Plan, Inc.), 6.75%, 12/1/13 $ 1,355,500
Baa1 A- 250 Minneapolis and St. Paul,
Housing and Redevelopment
Authority, (Group Health
Plan, Inc.), 6.90%, 10/15/22 273,045
NR BBB+ 2,120 Red Wing Health Care
Facilities, (River Region
Obligation Group), 6.50%,
9/1/22 2,276,308
NR AA+ 1,000 Rochester Health Care
Facilities, (Mayo Clinic),
5.50%, 11/15/27 1,054,110
NR AA+ 2,200 Rochester Health Care
Facilities, (Mayo Clinic),
(AMT), Variable
Rate, 11/15/15(1) 2,560,249
Ba1 BBB 2,440 St. Paul, Housing and
Redevelopment Authority,
(Healtheast), 6.625%,
11/1/17 2,545,384
- --------------------------------------------------------------------------------
$10,064,596
- --------------------------------------------------------------------------------
Housing -- 13.4%
- --------------------------------------------------------------------------------
NR AAA $ 300 Coon Rapids, Multifamily
Housing, (Browns Meadow),
(FHA), (AMT), 6.85%, 8/1/33 $ 317,631
Aaa NR 500 Little Canada, Facilities
Revenue, (Cedars Lakeside)
(GNMA), 5.90%, 8/1/20 532,255
Aaa NR 500 Little Canada, Facilities
Revenue, (Cedars Lakeside)
(GNMA), 5.95%, 2/1/32 530,165
NR AAA 80 Minneapolis and St. Paul,
Housing Finance Board,
SFM, (GNMA), (AMT), 7.30%,
8/1/31 84,301
Aa2 AA+ 3,930 Minnesota HFA, SFMR,
(AMT), 6.50%, 1/1/26 4,160,297
Aa NR 1,250 St. Louis Park, (Knollwood
Apartments), (FHA),
6.25%, 12/1/28 1,344,463
Aaa NR 1,685 St. Paul, Housing and
Redevelopment Authority,
(Cliffe Apartments),
(GNMA), 6.00%, 1/1/31 1,783,876
- --------------------------------------------------------------------------------
$ 8,752,988
- --------------------------------------------------------------------------------
Industrial Development Revenue -- 8.3%
- --------------------------------------------------------------------------------
NR A- $ 1,000 Cloquet PCR, (Potlach
Corp.), 5.90%, 10/1/26 $ 1,061,580
See notes to financial statements
45
<PAGE>
Minnesota Municipals Portfolio as of January 31, 1999
PORTFOLIO OF INVESTMENTS (Unaudited) CONT'D
Ratings
- ------------------ Principal
Amount
Standard (000's
Moody's & Poor's omitted) Security Value
- --------------------------------------------------------------------------------
Industrial Development Revenue (continued)
- --------------------------------------------------------------------------------
NR A- $ 750 Minneapolis, Community
Development Agency,
6.00%, 6/1/11 $ 795,308
NR A- 100 Minneapolis, Community
Development Agency,
7.35%, 12/1/09 108,850
NR A- 1,250 Minneapolis, Community
Development Agency,
7.40%, 12/1/21 1,378,013
NR A- 1,605 Minneapolis, Community
Development Agency, (AMT),
6.80%, 12/1/24 1,756,368
NR A- 300 Minneapolis, Community
Development Agency,
(Firemans Ins.), 6.40%,
12/1/04 308,409
- --------------------------------------------------------------------------------
$ 5,408,528
- --------------------------------------------------------------------------------
Insured-Electric Utilities -- 20.5%
- --------------------------------------------------------------------------------
Aaa AAA $ 3,150 Northern Minnesota
Municipal Power Agency,
(AMBAC), 4.75%, 1/1/20 $ 3,102,655
Aaa AAA 1,050 Northern Minnesota
Municipal Power Agency,
(AMBAC), 5.30%, 1/1/21 1,085,606
Aaa AAA 700 Northern Minnesota
Municipal Power Agency,
(FSA), 5.40%, 1/1/16 746,354
Aaa AAA 3,000 Southern Minnesota
Municipal Power Agency,
(MBIA), 0.00%, 10/1/21 1,018,290
Aaa AAA 10,000 Southern Minnesota
Municipal Power Agency,
(MBIA), 0.00%, 1/1/25 2,758,899
Aaa AAA 9,880 Southern Minnesota
Municipal Power Agency,
(MBIA), 0.00%, 1/1/26 2,593,697
Aaa AAA 4,800 Southern Minnesota
Municipal Power Agency,
(MBIA), 0.00%, 1/1/27 1,198,992
Aaa AAA 300 Southern Minnesota
Municipal Power Agency,
(MBIA), (AMT), Variable
Rate, 1/1/18(1)(2) 333,750
Aaa AAA 510 Western Minnesota
Municipal Power Agency,
(MBIA), 5.50%, 1/1/15 510,944
- --------------------------------------------------------------------------------
$13,349,187
- --------------------------------------------------------------------------------
Insured-General Obligations -- 2.3%
- --------------------------------------------------------------------------------
Aaa AAA $ 1,330 St. Francis, Independent
School District No. 15,
(FGIC), 6.35%, 2/1/12 $ 1,528,064
- --------------------------------------------------------------------------------
$ 1,528,064
- --------------------------------------------------------------------------------
Insured-Hospital -- 3.7%
- --------------------------------------------------------------------------------
Aaa AAA $ 100 Minneapolis and St. Paul,
Housing and Redevelopment
Authority, (Health One),
(MBIA), 7.40%, 8/15/11 $ 107,704
Aaa AAA 250 Minneapolis, Hospital
Revenue, (Fairview
Hospital), (MBIA),
6.50%, 1/1/11 271,845
Aaa AAA 450 Minnesota Agricultural and
Economic Development,
(Fairview Hospital),
(MBIA), 5.75%, 11/15/26 483,885
Aaa AAA 450 Plymouth, Health
Facilities, (Westhealth),
(CGIC), 6.25%, 6/1/16 501,692
Aaa AAA 1,000 St. Louis Park, Health
Care Facilities, (AMBAC),
Variable Rate, 7/1/13(1) 1,051,250
- --------------------------------------------------------------------------------
$ 2,416,376
- --------------------------------------------------------------------------------
Insured-Housing -- 2.6%
- --------------------------------------------------------------------------------
Aaa AAA $ 1,500 SCA MFMR Receipts,
Burnsville, (FSA), 7.10%,
1/1/30 $ 1,671,405
- --------------------------------------------------------------------------------
$ 1,671,405
- --------------------------------------------------------------------------------
Insured-Special Tax Revenue -- 4.9%
- --------------------------------------------------------------------------------
Aaa AAA $ 3,000 St. Paul, Housing and
Redevelopment Authority,
(Civic Center), (MBIA),
5.45%, 11/1/13 $ 3,218,009
- --------------------------------------------------------------------------------
$ 3,218,009
- --------------------------------------------------------------------------------
Insured-Transportation -- 0.7%
- --------------------------------------------------------------------------------
Aaa AAA $ 1,000 Puerto Rico Highway and
Transportation Authority,
(AMBAC), 0.00%, 7/1/16 $ 446,660
- --------------------------------------------------------------------------------
$ 446,660
- --------------------------------------------------------------------------------
Lease Revenue/
Certificates of Participation -- 3.5%
- --------------------------------------------------------------------------------
A3 NR $ 350 Cambridge EDA, 6.25%,
2/1/14 $ 376,796
NR AA 1,770 Hennepin County, 6.80%,
5/1/17 1,932,238
- --------------------------------------------------------------------------------
$ 2,309,034
- --------------------------------------------------------------------------------
Miscellaneous -- 1.6%
- --------------------------------------------------------------------------------
NR NR $ 1,000 Red Lake Band of Chippewa
Indians, 6.25%, 8/1/13 $ 1,013,820
- --------------------------------------------------------------------------------
$ 1,013,820
- --------------------------------------------------------------------------------
See notes to financial statements
46
<PAGE>
Minnesota Municipals Portfolio as of January 31, 1999
PORTFOLIO OF INVESTMENTS (Unaudited) CONT'D
Ratings
- ------------------ Principal
Amount
Standard (000's
Moody's & Poor's omitted) Security Value
- --------------------------------------------------------------------------------
Nursing Home -- 2.8%
- --------------------------------------------------------------------------------
NR NR $ 1,000 Columbia Heights,
Multifamily, (Crest View),
6.00%, 3/1/33 $ 1,019,570
NR NR 800 Minneapolis, (Walker
Methodist Senior
Services), 6.00%, 11/15/28 812,768
- --------------------------------------------------------------------------------
$ 1,832,338
- --------------------------------------------------------------------------------
Solid Waste -- 0.7%
- --------------------------------------------------------------------------------
Aa3 AA- $ 450 Anoka County, Solid Waste
Disposal, National Rural
Utility, (AMT), 6.95%,
12/1/08 $ 477,999
- --------------------------------------------------------------------------------
$ 477,999
- --------------------------------------------------------------------------------
Transportation -- 4.4%
- --------------------------------------------------------------------------------
Aaa AAA $ 1,500 Minneapolis and St. Paul,
Metropolitan Apartments
Commerce, (AMT), 4.50%,
1/1/15 $ 1,470,705
Baa1 A 1,000 Puerto Rico Highway and
Transportation Authority,
4.75%, 7/1/38 969,650
Baa1 A 400 Puerto Rico Highway and
Transportation Authority,
5.00%, 7/1/36 402,532
- --------------------------------------------------------------------------------
$ 2,842,887
- --------------------------------------------------------------------------------
Total Tax-Exempt Investments -- 100.0%
(identified cost $58,787,913) $65,151,086
- --------------------------------------------------------------------------------
AMT -- Interest earned from these securities may be considered a tax preference
item for purposes of the Federal Alternative Minimum Tax.
The portfolio invests primarily in debt securities issued by Minnesota
municipalities. The ability of the issuers of the debt securities to meet their
obligations may be affected by the economic developments in a specific industry
or municipality. In order to reduce the risk associated with such economic
developments, at January 31, 1999, 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 0.8% to 19.2% of total investments.
(1) Security has been issued as an inverse floater bond.
(2) Security exempt from registration under Rule 144A of the Securities Act of
1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers. It is the
Portfolio's intention to hold this security until maturity.
See notes to financial statements
47
<PAGE>
New Jersey Municipals Portfolio as of January 31, 1999
PORTFOLIO OF INVESTMENTS (Unaudited)
Tax-Exempt Investments -- 100.0%
Ratings
- ------------------ Principal
Amount
Standard (000's
Moody's & Poor's omitted) Security Value
- --------------------------------------------------------------------------------
Assisted Living -- 2.5%
- --------------------------------------------------------------------------------
NR NR $3,750 New Jersey EDA,
(Chelsea at East
Brunswick), (AMT),
8.25%, 10/1/20 $ 4,171,275
NR NR 3,630 New Jersey EDA,
(Forsgate), (AMT),
8.625%, 6/1/25 4,198,603
- --------------------------------------------------------------------------------
$ 8,369,878
- --------------------------------------------------------------------------------
Cogeneration -- 4.7%
- --------------------------------------------------------------------------------
NR BBB- $1,725 New Jersey EDA,
(Trigen Trenton),
(AMT), 6.20%, 12/1/07 $ 1,823,377
NR BB+ 12,750 New Jersey EDA,
(Vineland
Cogeneration), (AMT),
7.875%, 6/1/19 13,853,129
- --------------------------------------------------------------------------------
$15,676,506
- --------------------------------------------------------------------------------
Education -- 2.2%
- --------------------------------------------------------------------------------
Aaa AAA $1,000 New Jersey Educational
Facilities Authority,
(Princeton
Theological), 5.00%,
7/1/22 $ 1,006,830
Baa1 A- 2,480 New Jersey Educational
Facilities Authority,
(Seton Hall Univ.),
7.00%, 7/1/21 2,666,670
NR NR 8,800 New Jersey Higher
Educational Student
Loan Bonds, (AMT),
0.00%, 7/1/10 3,661,944
- --------------------------------------------------------------------------------
$ 7,335,444
- --------------------------------------------------------------------------------
Electric Utilities -- 3.9%
- --------------------------------------------------------------------------------
NR BBB $3,000 Guam Power Authority,
6.75%, 10/1/24 $ 3,348,150
NR A+ 6,000 New Jersey EDA, (AMT),
5.45%, 4/1/28 5,980,380
Baa1 BBB+ 6,500 Puerto Rico Electric
Power Authority,
0.00%, 7/1/17 2,688,530
Baa1 BBB+ 2,000 Puerto Rico Electric
Power Authority,
0.00%, 7/1/17 827,240
- --------------------------------------------------------------------------------
$12,844,300
- --------------------------------------------------------------------------------
Escrowed / Prerefunded -- 3.8%
- --------------------------------------------------------------------------------
NR NR $ 615 New Jersey EDA,
(Cadbury Corp.),
Prerefunded to 7/1/01,
7.50%, 7/1/21 $ 688,978
NR NR 2,000 New Jersey EDA,
(Cadbury Corp.),
Prerefunded to 7/1/01,
8.00%, 7/1/15 2,263,620
NR NR 300 New Jersey EDA,
(Cadbury Corp.),
Prerefunded to 7/1/01,
8.70%, 7/1/07 341,565
NR NR 7,600 New Jersey Sports and
Exposition Authority,
(Monmouth Park),
Prerefunded to 1/1/05,
8.00%, 1/1/25 9,351,875
- --------------------------------------------------------------------------------
$12,646,038
- --------------------------------------------------------------------------------
General Obligations -- 4.2%
- --------------------------------------------------------------------------------
NR BBB $9,745 Guam, 5.40%, 11/15/18 $ 9,886,302
NR A+ 1,500 Hudson County
Improvement Authority,
6.625%, 8/1/25 1,643,100
Aa2 NR 3,000 Mercer County
Improvement Authority,
0.00%, 4/1/10 1,846,800
Baa1 A 1,600 Puerto Rico, 0.00%,
7/1/18 628,432
- --------------------------------------------------------------------------------
$14,004,634
- --------------------------------------------------------------------------------
Hospital -- 12.8%
- --------------------------------------------------------------------------------
Ba2 NR $4,950 Camden County,
Improvement Authority
Revenue, (Cooper
Health System), 6.00%,
2/15/27 $4,450,496
A3 A- 2,300 New Jersey Health Care
Facilities Financing
Authority, (Atlantic
City Medical Center),
6.80%, 7/1/11 2,535,175
Baa2 NR 5,875 New Jersey Health Care
Facilities Financing
Authority, (Deborah
Heart and Lung
Center),
6.30%, 7/1/23 6,223,094
Baa1 NR 4,000 New Jersey Health Care
Facilities Financing
Authority, (Southern
Ocean County
Hospital),
6.25%, 7/1/23 4,240,640
Aa2 AAA 9,585 New Jersey Health Care
Facilities Financing
Authority, (St.
Elizabeth's Hospital),
6.80%, 8/1/19 10,408,063
Baa1 A- 1,250 New Jersey Health Care
Facilities, (Capital
Health System),
5.125%, 7/1/12 1,258,475
Baa1 A- 3,500 New Jersey Health Care
Facilities, (Capital
Health System),
5.25%, 7/1/17 3,505,425
Baa2 BBB 5,400 New Jersey Health Care
Facilities, (Capital
Health System),
6.00%, 7/1/27 5,668,542
See notes to financial statements
48
<PAGE>
New Jersey Municipals Portfolio as of January 31, 1999
PORTFOLIO OF INVESTMENTS (Unaudited) CONT'D
Ratings
- ------------------ Principal
Amount
Standard (000's
Moody's & Poor's omitted) Security Value
- --------------------------------------------------------------------------------
Hospital (continued)
Baa1 A- $1,750 New Jersey Health Care
Facilities, (Capital
Health Sytem),
5.25%, 7/1/27 $ 1,747,095
NR BBB+ 2,720 New Jersey Health Care
Facilities, (Holy Name
Hospital),
6.00%, 7/1/25 2,860,814
- --------------------------------------------------------------------------------
$42,897,819
- --------------------------------------------------------------------------------
Housing -- 2.9%
- --------------------------------------------------------------------------------
NR AAA $1,000 Guam Housing Corp.,
Single Family, 5.75%,
9/1/31 $ 1,092,550
NR A+ 1,250 New Jersey HFA,
7.25%, 11/1/22 1,322,700
NR AAA 2,000 New Jersey HFA,
(Presidential Plaza),
(FHA), 6.95%, 5/1/13 2,176,600
NR AAA 3,700 New Jersey HFA,
(Presidential Plaza),
(FHA), 7.00%, 5/1/30 4,033,592
NR A+ 1,000 New Jersey HFA, Rental
Housing, (AMT), 7.10%,
5/1/22 1,065,290
- --------------------------------------------------------------------------------
$ 9,690,732
- --------------------------------------------------------------------------------
Industrial Development Revenue -- 13.3%
- --------------------------------------------------------------------------------
NR NR $4,000 Middlesex County
Pollution Control
Financing Authority,
(Amerada Hess Corp.),
6.875%, 12/1/22 $ 4,337,600
NR NR 2,000 Middlesex County
Pollution Control
Financing Authority,
(Amerada Hess Corp.),
7.875%, 6/1/22 2,286,920
Ba2 BB 1,000 New Jersey EDA,
(Continental
Airlines), (AMT),
5.50%, 4/1/28 1,006,560
Aa1 NR 3,000 New Jersey EDA,
(Garden State Paper
Co.), 7.125%, 4/1/22 3,309,960
Baa1 BBB+ 2,135 New Jersey EDA, (GATX
Terminals Corp.),
7.30%, 9/1/19 2,410,287
NR NR 3,500 New Jersey EDA,
(Glimcher Properties
REIT), (AMT),
6.00%, 11/1/28 3,543,785
NR NR 5,640 New Jersey EDA, (Holt
Hauling), 8.95%,
12/15/18 6,229,380
NR NR 1,500 New Jersey EDA, (Holt
Hauling), (AMT),
7.90%, 3/1/27 1,693,800
NR NR 1,160 New Jersey EDA,
(National Association
of Accountants),
7.65%, 7/1/09 1,231,247
NR NR 2,000 New Jersey EDA, (The
Seeing Eye, Inc.),
7.30%, 4/1/11 2,110,160
Baa3 BBB- 5,100 Port Authority of New
York and New Jersey,
(Delta Airlines),
6.95%, 6/1/08 5,481,021
Baa3 BBB- 3,150 Puerto Rico Port
Authority, (American
Airlines), (AMT),
6.25%, 6/1/26 3,382,313
Baa3 BBB- 5,550 Puerto Rico Port
Authority, (American
Airlines), (AMT),
6.30%, 6/1/23 5,902,869
NR BBB 1,520 South Jersey
Transportation
Authority, (Raytheon
Aircraft), 6.15%,
1/1/22 1,617,052
- --------------------------------------------------------------------------------
$44,542,954
- --------------------------------------------------------------------------------
Insured-Education -- 0.3%
- --------------------------------------------------------------------------------
Aaa AAA $ 845 New Jersey Educational
Facilities Authority,
(Seton Hall
University), (BIGI),
6.85%, 7/1/19 $ 874,702
- --------------------------------------------------------------------------------
$ 874,702
- --------------------------------------------------------------------------------
Insured-General Obligations -- 1.2%
- --------------------------------------------------------------------------------
Aaa AAA $3,815 Middletown Township,
Board of Education,
(MBIA),
5.80%, 8/1/23 $ 4,108,641
- --------------------------------------------------------------------------------
$ 4,108,641
- --------------------------------------------------------------------------------
Insured-Hospital -- 6.0%
- --------------------------------------------------------------------------------
Aaa NR $4,250 New Jersey EDA,
(Hillcrest Health
Services), (AMBAC),
0.00%, 1/1/19 $ 1,601,315
Aaa NR 3,000 New Jersey EDA,
(Hillcrest Health
Services), (AMBAC),
0.00%, 1/1/21 1,018,290
Aaa NR 10,620 New Jersey EDA, (St.
Barnabas), (MBIA),
0.00%, 7/1/26 2,748,775
Aaa AAA 6,000 New Jersey Health Care
Facilities Authority,
(St. Barnabas Health),
(MBIA), 0.00%, 7/1/23 1,800,480
Aaa AAA 1,570 New Jersey Health Care
Facilities Financing
Authority, (Cathedral
Health Services)
(MBIA),
7.25%, 2/15/21 1,721,128
Aaa AAA 2,415 New Jersey Health Care
Facilities Financing
Authority, (Cathedral
Health Services),
(MBIA),
5.20%, 8/1/15 2,503,751
See notes to financial statements
49
<PAGE>
New Jersey Municipals Portfolio as of January 31, 1999
PORTFOLIO OF INVESTMENTS (Unaudited) CONT'D
Ratings
- ------------------ Principal
Amount
Standard (000's
Moody's & Poor's omitted) Security Value
- --------------------------------------------------------------------------------
Insured-Hospital (continued)
- --------------------------------------------------------------------------------
Aaa AAA $2,000 New Jersey Health Care
Facilities Financing
Authority, (Hackensack
Medical Center)
(FGIC),
6.25%, 7/1/21 $ 2,135,000
Aaa AAA 2,150 New Jersey Health Care
Facilities, (Virtua
Health Issue), (FSA),
4.50%, 7/1/28 2,024,634
Aaa AAA 4,680 New Jersey Health Care
Finance Revenue, (St.
Barnabas Health),
(MBIA), 4.75%, 7/1/28 4,532,065
- --------------------------------------------------------------------------------
$20,085,438
- --------------------------------------------------------------------------------
Insured-Housing -- 1.2%
- --------------------------------------------------------------------------------
Aaa AAA $1,525 New Brunswick, Housing
Authority, (Rutgers
University), (FGIC),
4.625%, 7/1/24 $ 1,467,569
Aaa AAA 770 New Jersey HFA, (AMT),
(MBIA), 7.70%, 10/1/29 792,961
Aaa AAA 1,550 Pennsauken Township,
Housing Finance Corp.,
(MBIA),
8.00%, 4/1/11 1,609,985
- --------------------------------------------------------------------------------
$ 3,870,515
- --------------------------------------------------------------------------------
Insured-Industrial Development Revenue -- 1.0%
- --------------------------------------------------------------------------------
Aaa AAA $2,000 New Jersey EDA,
(Educational Testing
Service), (MBIA),
4.75%, 5/15/25 $ 1,954,340
Aaa AAA 1,150 New Jersey EDA, (New
Jersey American Water
Co.), (AMT) (FGIC),
6.875%, 11/1/34 1,316,520
- --------------------------------------------------------------------------------
$ 3,270,860
- --------------------------------------------------------------------------------
Insured-Lease Revenue / Certificates
of Participation -- 3.4%
- --------------------------------------------------------------------------------
Aaa AAA $3,900 Atlantic County,
Public Facilities
Lease Agreement,
(FGIC),
6.00%, 3/1/13 $ 4,543,149
Aaa AAA 2,500 Hudson County
Improvement Authority,
Secondary Yield Curve
Notes, (FGIC) Variable
Rate, 12/1/25(1)(2) 3,041,250
Aaa AAA 1,750 Hudson County,
Correctional Facility,
(MBIA),
6.50%, 12/1/11 1,910,948
Aaa AAA 1,800 Middlesex County,
Certificates of
Participation, (MBIA),
6.125%, 2/15/19 2,018,088
- --------------------------------------------------------------------------------
$11,513,435
- --------------------------------------------------------------------------------
Insured-Transportation -- 7.9%
- --------------------------------------------------------------------------------
Aaa AAA $3,240 Delaware River Port
Authority, PA and NJ,
(MBIA), 5.00%, 1/1/26 $ 3,258,760
Aaa AAA 3,500 New Jersey State
Transportation
Authority, (FSA),
4.50%, 6/15/19 3,353,315
NR AAA 5,000 New Jersey Turnpike
Authority, "RITES"
(MBIA), Variable
Rate, 1/1/16(1) 7,175,850
Aaa AAA 9,285 New Jersey Turnpike
Authority, (MBIA),
6.50%, 1/1/16 11,337,077
Aaa AAA 1,000 New Jersey Turnpike
Authority, (MBIA),
6.50%, 1/1/16 1,221,010
- --------------------------------------------------------------------------------
$26,346,012
- --------------------------------------------------------------------------------
Insured-Water and Sewer -- 1.2%
- --------------------------------------------------------------------------------
Aaa AAA $1,000 Jersey City Municipal
Utilities Authority,
(FSA),
5.25%, 12/1/12 $ 1,091,150
Aaa AAA 2,500 Middlesex County,
Utilities Authority,
(MBIA), Variable
Rate, 8/15/10 2,976,375
- --------------------------------------------------------------------------------
$ 4,067,525
- --------------------------------------------------------------------------------
Lease Revenue/
Certificates of Participation -- 4.1%
- --------------------------------------------------------------------------------
Baa1 A $ 720 Atlantic County,
Public Facilities
Lease Agreement,
8.875%, 1/15/14 $ 1,018,663
Baa1 A 785 Atlantic County,
Public Facilities
Lease Agreement,
8.875%, 1/15/15 1,116,207
A1 NR 1,000 Bedminster Township,
Board of Education,
7.125%, 9/1/10 1,093,890
Aa AA- 2,000 Mercer County
Improvement Authority,
(Richard J. Hughes
Justice), 6.05%, 1/1/15 2,004,520
Aa AA- 1,500 Mercer County
Improvement Authority,
(Richard J. Hughes
Justice), 6.05%, 1/1/16 1,503,330
Aa AA- 1,500 Mercer County
Improvement Authority,
(Richard J. Hughes
Justice), 6.05%, 1/1/17 1,503,270
Aa2 AA- 2,591 New Jersey Building
Authority, (Garden
State Savings Bonds),
0.00%, 6/15/10 1,580,847
Aa3 AA- 5,500 New Jersey EDA,
Economic Recovery
Fund, 0.00%, 3/15/13 2,841,355
See notes to financial statements
50
<PAGE>
New Jersey Municipals Portfolio as of January 31, 1999
PORTFOLIO OF INVESTMENTS (Unaudited) CONT'D
Ratings
- ------------------ Principal
Amount
Standard (000's
Moody's & Poor's omitted) Security Value
- --------------------------------------------------------------------------------
Lease Revenue/
Certificates of Participation (continued)
- --------------------------------------------------------------------------------
Aa3 AA- $1,650 New Jersey EDA, State
Contract, 0.00%, $ 1,046,562
9/15/09
- --------------------------------------------------------------------------------
$ 13,708,644
- --------------------------------------------------------------------------------
Miscellaneous -- 1.0%
- --------------------------------------------------------------------------------
Aaa AAA $3,650 New Jersey Sports and
Exposition Authority,
(State Contract),
(MBIA), 4.50%, 3/1/24 $ 3,452,937
- --------------------------------------------------------------------------------
$ 3,452,937
- --------------------------------------------------------------------------------
Nursing Home -- 1.3%
- --------------------------------------------------------------------------------
NR NR $1,385 New Jersey EDA,
(Claremont Health
System, Inc.),
9.10%, 9/1/22 $ 1,559,829
NR NR 2,500 New Jersey EDA,
(Victoria Health 2,746,350
Corp.), 7.65%, 1/1/14
- --------------------------------------------------------------------------------
$ 4,306,179
- --------------------------------------------------------------------------------
Senior Living / Life Care -- 0.5%
- --------------------------------------------------------------------------------
NR NR $1,480 New Jersey EDA,
(Hudson County
Occupational Center),
6.50%, 7/1/18 $ 1,505,560
- --------------------------------------------------------------------------------
$ 1,505,560
- --------------------------------------------------------------------------------
Transportation -- 19.1%
- --------------------------------------------------------------------------------
Aa2 NR $1,750 New Jersey State
Transportation Trust
Fund, Variable
Rate, 6/15/17(1) $ 1,792,193
A1 AA- 5,000 Port Authority of New
York and New Jersey,
5.375%, 3/1/28 5,450,500
A1 AA- 19,000 Port Authority of New
York and New Jersey,
6.125%, 6/1/24 22,340,009
A1 AA- 4,750 Port Authority of New
York and New Jersey,
(AMT),
6.25%, 1/15/27 5,043,313
NR NR 5,000 Port Authority of New
York and New Jersey,
(KIAC),
6.75%, 10/1/19 5,579,150
Baa1 A 2,500 Puerto Rico Highway
and Transportation
Authority,
4.75%, 7/1/38 2,424,125
Baa1 A 6,825 Puerto Rico Highway
and Transportation
Authority,
5.00%, 7/1/36 6,868,202
Baa1 A 3,600 Puerto Rico Highway
and Transportation
Authority,
5.00%, 7/1/38 3,560,076
Baa1 A 7,825 Puerto Rico Highway
and Transportation
Authority,
5.50%, 7/1/36 8,394,425
Baa1 A- 2,500 Puerto Rico Highway
and Transportation
Authority, (State
Infrastructure Bank),
5.00%, 7/1/28 2,490,350
- --------------------------------------------------------------------------------
$ 63,942,343
- --------------------------------------------------------------------------------
Water and Sewer -- 1.5%
- --------------------------------------------------------------------------------
A3 A $4,500 New Jersey EDA,
Elizabethtown Water
Revenue, (AMT),
6.70%, 8/1/21 $ 4,829,805
Aa2 AA 80 New Jersey Wastewater
Treatment Trust,
6.875%, 6/15/09 85,318
Aa2 AA 20 New Jersey Wastewater
Treatment Trust,
7.00%, 6/15/10 21,349
- --------------------------------------------------------------------------------
$ 4,936,472
- --------------------------------------------------------------------------------
Total Tax-Exempt Investments -- 100.0%
(identified cost $300,916,237) $333,997,568
- --------------------------------------------------------------------------------
AMT - Interest earned from these securities may be considered a tax preference
item for purposes of the Federal Alternative Minimum Tax.
The portfolio invests primarily 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 the economic developments in a specific industry
or municipality. In order to reduce the risk associated with such economic
developments, at January 31, 1999, 22.2% 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 insured by
financial institution ranged from 0.3% to 15.5% of total investments.
(1) Security has been issued as an inverse floater bond.
(2) Security exempt from registration under Rule 144A of the Securities Act of
1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers. It is the
Portfolio's intention to hold this security until maturity.
See notes to financial statements
51
<PAGE>
Pennsylvania Municipals Portfolio as of January 31, 1999
PORTFOLIO OF INVESTMENTS (Unaudited)
Tax-Exempt Investments -- 100.0%
Ratings
- ------------------ Principal
Amount
Standard (000's
Moody's & Poor's omitted) Security Value
- --------------------------------------------------------------------------------
Assisted Living -- 4.2%
- --------------------------------------------------------------------------------
NR NR $ 5,000 Chester IDA, (Senior Life
Choice of Kimberton),
(AMT), 8.50%, 9/1/25 $ 5,720,100
NR NR 2,680 Chester IDA, (Senior Life
Choice of Paoli, L.P.),
(AMT), 8.05%, 1/1/24 2,992,434
NR NR 5,000 Delaware IDA, (Glen
Riddle), (AMT), 8.625%,
9/1/25 5,753,500
- --------------------------------------------------------------------------------
$ 14,466,034
- --------------------------------------------------------------------------------
Cogeneration -- 2.8%
- --------------------------------------------------------------------------------
NR BBB- $ 9,000 Pennsylvania EDA,
(Northampton Generating),
(AMT), 6.50%, 1/1/13 $ 9,541,079
- --------------------------------------------------------------------------------
$ 9,541,079
- --------------------------------------------------------------------------------
Education -- 4.7%
- --------------------------------------------------------------------------------
NR AAA $ 2,000 Lehigh County General
Purpose Authority,
(Allentown College of St.
Francis), 6.75%,
12/15/12(1) $ 2,171,720
NR BBB- 1,100 Lehigh County General
Purpose Authority, (Cedar
Crest College), 6.70%,
4/1/26 1,203,488
Baa3 NR 3,000 Pennsylvania Higher
Educational Facilities
Authority, (Delaware
Valley College of Science
and Agriculture), 5.35%,
4/15/28 2,915,160
NR BBB- 3,000 Pennsylvania Higher
Educational Facilities
Authority, (Gwynedd-Mercy
College), 5.60%, 11/1/22 3,055,020
NR BBB+ 2,000 Pennsylvania Higher
Educational Facilities
Authority, (Ursinns
College), 5.90%, 1/1/27 2,116,100
NR A- 4,225 Scranton-Lackawanna,
(University of Scranton),
6.40%, 3/1/07 4,601,828
- --------------------------------------------------------------------------------
$ 16,063,316
- --------------------------------------------------------------------------------
Electric Utilities -- 2.4%
- --------------------------------------------------------------------------------
Baa3 BB- $ 500 Beaver IDA, (Ohio Edison
Co.), 7.75%, 9/1/24 $ 518,230
Baa1 BBB+ 3,250 Delaware IDA,
(Philadelphia Electric
Co.), 7.375%, 4/1/21 3,476,915
Baa2 BBB+ 4,070 Montgomery IDA,
(Philadelphia Electric
Co.), (AMT), 7.60%, 4/1/21 4,396,577
- --------------------------------------------------------------------------------
$ 8,391,722
- --------------------------------------------------------------------------------
Escrowed / Prerefunded -- 6.0%
- --------------------------------------------------------------------------------
NR NR $ 4,315 Hazelton Luzerne, (Saint
Joseph Medical Center),
Prerefunded to 7/1/03,
8.375%, 7/1/12 $ 5,109,478
Aaa AAA 5,000 Philadelphia Hospital and
Higher Education
Authority, (FGIC),
Prerefunded to 2/15/04,
Variable Rate, 3/6/12(2) 5,406,250
Baa2 NR 4,115 Somerset, (Community
Hospital), Prerefunded to
3/1/02, 6.75%, 3/1/11 4,497,119
Aaa AAA 4,845 Westmoreland Municipal
Authority, (FGIC),
Escrowed to Maturity,
0.00%, 8/15/19 1,735,576
Aaa AAA 5,400 Westmoreland Municipal
Authority, (FGIC),
Escrowed to Maturity,
0.00%, 8/15/20 1,875,204
Aaa AAA 5,780 Westmoreland Municipal
Authority, (FGIC),
Escrowed to Maturity,
0.00%, 8/15/20 1,961,327
- --------------------------------------------------------------------------------
$ 20,584,954
- --------------------------------------------------------------------------------
General Obligations -- 1.2%
- --------------------------------------------------------------------------------
NR A $ 3,000 Dauphin, 6.90%, 6/1/26 $ 3,253,470
Baa1 A 1,000 Puerto Rico, 4.50%, 7/1/23 937,270
- --------------------------------------------------------------------------------
$ 4,190,740
- --------------------------------------------------------------------------------
Hospital -- 10.8%
- --------------------------------------------------------------------------------
A3 NR $ 5,330 Allegheny County HDA,
(St. Francis Medical
Center), 5.75%, 5/15/27 $ 5,558,764
NR NR 2,000 Allegheny County HDA,
(Villa St. Joseph),
6.00%, 8/15/28 1,972,160
NR AAA 2,270 Allegheny IDA,
(Presbyterian Medical
Center), 6.75%, 2/1/26 2,532,435
Baa A 2,000 Dauphin County Hospital
Authority, (Community
General Osteopathic
Hospital), 7.375%, 6/1/16 2,238,560
NR BBB 1,150 Horizon Hospital Systems
Authority, (Horizon
Hospital Systems, Inc.),
6.35%, 5/15/26 1,233,686
A NR 2,670 Indiana County Hospital
Authority, (Indiana
Hospital), 7.125%, 7/1/23 2,953,260
A3 A 3,250 Lehigh County Hospital
Authority, (Muhlenberg
Hospital), 6.60%, 7/15/22 3,702,660
NR B 2,550 Monroeville Hospital
Authority, (Forbes Health
System), 6.25%, 10/1/15 2,244,000
See notes to financial statements
52
<PAGE>
Pennsylvania Municipals Portfolio as of January 31, 1999
PORTFOLIO OF INVESTMENTS (Unaudited) CONT'D
Ratings
- ------------------ Principal
Amount
Standard (000's
Moody's & Poor's omitted) Security Value
- --------------------------------------------------------------------------------
Hospital (continued)
- --------------------------------------------------------------------------------
Baa2 NR $ 1,375 Montgomery Hospital
Authority, (Montgomery
Hospital Medical Center),
6.60%, 7/1/10 $ 1,485,784
NR B 500 Pennsylvania HEFA,
(Allegheny General
Hospital), 7.25%, 9/1/17 450,000
Ca CCC 5,625 Philadelphia HEFA,
(Graduate Health System),
6.625%, 7/1/21 2,137,500
Ca CCC 7,115 Philadelphia HEFA,
(Graduate Health System),
7.25%, 7/1/18 2,703,700
A3 NR 7,000 Washington County
Hospital Authority,
(Monongahela Valley
Hospital), 6.75%, 12/1/08 7,748,229
- --------------------------------------------------------------------------------
$ 36,960,738
- --------------------------------------------------------------------------------
Housing -- 4.6%
- --------------------------------------------------------------------------------
NR AAA $ 2,830 Allegheny, SFMR, (Ladies
Grand Army), (FHA), 6.35%,
10/1/36 $ 3,134,678
Aa2 AA 1,000 Pennsylvania HFA, (AMT),
Variable Rate, 10/3/23(2) 1,130,000
Aa2 AA+ 2,000 Pennsylvania HFA, SFMR,
(AMT), 6.15%, 10/1/27 2,130,560
Aa2 AA+ 3,300 Pennsylvania HFA, Single
Family, (AMT), 5.50%,
4/1/29 3,388,209
A1 AAA 1,000 Pittsburgh Urban
Redevelopment Authority,
7.125%, 4/1/15 1,048,000
Aa2 AAA 265 Pittsburgh Urban
Redevelopment Authority,
7.45%, 4/1/10 279,122
Aa2 AAA 3,295 Pittsburgh Urban
Redevelopment Authority,
(AMT), 7.10%, 4/1/24 3,610,200
A1 AAA 1,055 Pittsburgh Urban
Redevelopment Authority,
(AMT), 7.40%, 4/1/24 1,109,048
- --------------------------------------------------------------------------------
$ 15,829,817
- --------------------------------------------------------------------------------
Industrial Development Revenue -- 18.3%
- --------------------------------------------------------------------------------
A3 BBB+ $ 6,450 Butler County IDA, (Witco
Corp.), 5.85%, 12/1/23 $ 6,720,191
NR BB 1,005 Clearfield County IDA,
(Kmart Corp.), 6.80%,
5/15/07 1,072,606
NR A 4,000 Franklin County IDA,
(Corning, Inc.), 6.25%,
8/1/05 4,551,520
A2 A- 12,000 New Morgan IDA, (New
Morgan Landfill), (AMT),
6.50%, 4/1/19 13,004,879
NR BBB- 9,000 Pennsylvania EDA,
(Colver), (AMT), 7.125%,
12/1/15 9,966,509
NR BBB- 5,000 Pennsylvania EDA,
(Colver), (AMT), 7.15%,
12/1/18 5,551,200
Baa3 BBB 4,450 Pennsylvania IDA, (Sun
Company), (AMT), 7.60%,
12/1/24 5,074,024
NR NR 6,500 Philadelphia IDA,
(Refrigerated
Enterprises), (AMT), 7,268,105
9.05%, 12/1/19
Baa3 BBB- 5,000 Puerto Rico Port
Authority, (American
Airlines), (AMT), 6.25%,
6/1/26 5,368,750
Baa3 BBB- 2,800 Puerto Rico Port
Authority, (American
Airlines), (AMT), 6.30%,
6/1/23 2,978,024
NR BB 1,105 Shamokin IDA, (Kmart
Corp.), 6.70%, 7/1/07 1,184,195
- --------------------------------------------------------------------------------
$ 62,740,003
- --------------------------------------------------------------------------------
Insured-Education -- 5.0%
- --------------------------------------------------------------------------------
Aaa NR $ 3,000 Delaware County,
(Villanova University),
(MBIA), 5.00%, 12/1/28 $ 2,992,860
Aaa AAA 1,805 Northeastern, Hospital
and Education Authority,
(Wyoming Seminary),
(MBIA), 4.75%, 10/1/28 1,742,240
Aaa AAA 2,500 Pennsylvania Higher
Education Student Loan,
(AMBAC), (AMT), 7.15%,
9/1/21 2,683,925
Aaa AAA 1,500 Pennsylvania Higher
Education Student Loan,
(AMBAC), (AMT), Variable
Rate, 3/1/22(2) 1,715,625
Aaa AAA 700 Pennsylvania Higher
Education Student Loan,
(AMBAC), (AMT), Variable
Rate, 9/1/26(2) 810,250
Aaa AAA 500 Pennsylvania Higher
Educational Facilities,
(Drexel University),
(MBIA), 4.80%, 5/1/28 486,550
Aaa AAA 1,590 Pennsylvania Manor,
School District, (FGIC),
5.20%, 6/1/16 1,632,103
Aaa AAA 2,500 Philadelphia School
District, (MBIA), 4.75%,
4/1/27 2,415,100
Aaa AAA 1,000 State Public School
Building Authority,
(Westmoreland Community
College), (MBIA), 5.25%,
10/15/15 1,064,900
See notes to financial statements
53
<PAGE>
Pennsylvania Municipals Portfolio as of January 31, 1999
PORTFOLIO OF INVESTMENTS (Unaudited) CONT'D
Ratings
- ------------------ Principal
Amount
Standard (000's
Moody's & Poor's omitted) Security Value
- --------------------------------------------------------------------------------
Insured-Education (continued)
- --------------------------------------------------------------------------------
Aaa AAA $ 1,750 University of Pittsburgh,
(FGIC), 5.125%, 6/1/22 $ 1,761,043
- --------------------------------------------------------------------------------
$ 17,304,596
- --------------------------------------------------------------------------------
Insured-Electric Utilities -- 5.9%
- --------------------------------------------------------------------------------
Aaa AAA $ 4,000 Beaver IDA, (Ohio Edison
Co.), (FGIC), 7.00%,
6/1/21 $ 4,349,320
Aaa AAA 10,000 Beaver IDA, (Ohio Edison
Co.), (FGIC), 7.05%,
10/1/20 11,688,799
Aaa AAA 3,800 Puerto Rico Electric
Power Authority,
"STRIPES", (FSA),
Variable Rate, 7/1/02(2) 4,298,750
- --------------------------------------------------------------------------------
$ 20,336,869
- --------------------------------------------------------------------------------
Insured-General Obligations -- 9.8%
- --------------------------------------------------------------------------------
Aaa AAA $ 5,600 Berks, (FGIC), Variable
Rate, 11/10/20(2) $ 6,881,000
Aaa AAA 2,170 Elizabeth Forward School
District, (MBIA), 0.00%,
9/1/20 734,697
Aaa AAA 2,170 Elizabeth Forward School
District, (MBIA), 0.00%,
9/1/21 697,221
Aaa AAA 2,170 Elizabeth Forward School
District, (MBIA), 0.00%,
9/1/22 663,044
Aaa AAA 2,170 Elizabeth Forward School
District, (MBIA), 0.00%,
9/1/23 630,537
Aaa AAA 2,500 Erie School District,
(MBIA), 0.00%, 5/1/19 928,525
Aaa AAA 2,625 Erie School District,
(MBIA), 0.00%, 5/1/20 924,578
Aaa AAA 2,625 Erie School District,
(MBIA), 0.00%, 5/1/21 878,194
Aaa AAA 3,625 Erie School District,
(MBIA), 0.00%, 5/1/22 1,153,475
Aaa AAA 5,000 Hampton Township School
District, (FGIC), 5.00%,
9/1/27 4,988,450
Aaa NR 2,365 Harrisburg, (AMBAC),
0.00%, 3/15/17 962,721
Aaa AAA 5,175 Hazelton School District,
(FGIC), 0.00%, 3/1/21 1,705,007
Aaa NR 1,000 Hopewell School District,
(FSA), 0.00%, 9/1/22 305,550
Aaa AAA 7,500 Keystone Oaks School
District, (AMBAC),
Variable
Rate, 9/1/16(2) 8,831,249
Aaa AAA 1,430 Mars Area School
District, (MBIA), 0.00%,
3/1/14 701,115
Aaa AAA 655 Rochester Area School
District, (AMBAC), 0.00%,
5/1/10 401,987
Aaa NR 1,000 Upper Darby School
District, (AMBAC), 5.00%,
5/1/19 1,003,510
Aaa AAA 1,000 Venango County, (AMBAC),
6.30%, 12/1/19 1,086,410
- --------------------------------------------------------------------------------
$ 33,477,270
- --------------------------------------------------------------------------------
Insured-Hospital -- 6.3%
- --------------------------------------------------------------------------------
Aaa AAA $ 4,550 Allegheny County HDA,
(University of Pittsburg
Hospital), (MBIA),
5.625%, 4/1/27 $ 4,820,771
Aaa AAA 3,750 Allegheny County Hospital
Authority, (Magee-Womens
Hospital), (FGIC),
0.00%, 10/1/15 1,684,013
Aaa AAA 1,170 Allegheny County,
(Children's Hospital of
Pittsburgh), (MBIA),
6.75%, 7/1/08 1,224,428
Aaa AAA 2,500 Armstrong County Hospital
Authority, (Saint Francis
Health Care), (AMBAC),
6.00%, 8/15/08 2,694,075
Aaa AAA 1,400 Armstrong County Hospital
Authority, (Saint Francis
Health Care), (AMBAC),
6.25%, 6/1/13 1,524,054
Aaa AAA 775 Carbon County Hospital
Authority, (Gnaden
Memorial Hospital),
(AMBAC), 7.00%, 11/15/14 832,846
Aaa AAA 3,000 Delaware County Hospital
Authority, (Riddle
Memorial Hospital),
(FSA), 5.00%, 1/1/28 2,974,950
Aaa AAA 750 Erie County Hospital
Authority, (Hamot Health
System), (AMBAC), 7.10%,
2/15/10 819,458
Aaa NR 4,000 Lehigh County Hospital
Authority, (Lehigh Valley
Health Network), (MBIA),
5.00%, 7/1/28 3,954,240
Aaa AAA 1,000 Montgomery County HEFA,
(Abington Memorial
Hospital) (AMBAC),
Variable Rate, 7/5/11 1,173,750
- --------------------------------------------------------------------------------
$ 21,702,585
- --------------------------------------------------------------------------------
See notes to financial statements
54
<PAGE>
Pennsylvania Municipals Portfolio as of January 31, 1999
PORTFOLIO OF INVESTMENTS (Unaudited) CONT'D
Ratings
- ------------------ Principal
Amount
Standard (000's
Moody's & Poor's omitted) Security Value
- --------------------------------------------------------------------------------
Insured-Industrial Development Revenue -- 0.3%
- --------------------------------------------------------------------------------
Aaa AAA $ 1,000 Delaware County,
(Philadelphia Water),
(AMT), (FGIC),
6.35%, 8/15/25 $ 1,118,490
- --------------------------------------------------------------------------------
$ 1,118,490
- --------------------------------------------------------------------------------
Insured-Solid Waste -- 2.1%
- --------------------------------------------------------------------------------
Aaa AAA $ 6,705 Lancaster County, Solid
Waste Management
Authority Resources
Recovery System, (AMBAC),
5.375%, 12/15/15 $ 7,060,566
- --------------------------------------------------------------------------------
$ 7,060,566
- --------------------------------------------------------------------------------
Insured-Special Tax Revenue -- 0.9%
- --------------------------------------------------------------------------------
Aaa AAA $ 3,000 Puerto Rico Financing
Authority, (AMBAC),
5.00%, 7/1/28 $ 3,013,680
- --------------------------------------------------------------------------------
$ 3,013,680
- --------------------------------------------------------------------------------
Insured-Transportation -- 2.2%
- --------------------------------------------------------------------------------
Aaa AAA $ 2,000 Allegheny County Port
Authority, (Pittsburgh
International Airport),
(MBIA), 5.00%, 1/1/19 $ 2,002,240
Aaa AAA 2,000 Allegheny County Port
Authority, (Pittsburgh
International Airport),
(MBIA), (AMT), 5.25%,
1/1/16 2,063,140
Aaa AAA 1,000 Pennsylvania Turnpike
Commision Oil Franchise,
(AMBAC), 4.75%, 12/1/27 967,160
Aaa AAA 2,500 Southeastern
Transportation Authority,
(FGIC), 5.375%, 3/1/17 2,614,800
- --------------------------------------------------------------------------------
$ 7,647,340
- --------------------------------------------------------------------------------
Insured-Water and Sewer -- 2.7%
- --------------------------------------------------------------------------------
Aaa AAA $ 2,500 Philadelphia Water and
Wastewater, (CGIC),
Variable Rate, 6/15/12(2) $ 2,809,375
Aaa AAA 3,490 Pittsburgh Water and
Sewer Authority, (FGIC),
4.75%, 9/1/16 3,483,683
Aaa AAA 3,000 Pittsburgh Water and
Sewer Authority, (FSA),
5.00%, 9/1/19 3,009,660
- --------------------------------------------------------------------------------
$ 9,302,718
- --------------------------------------------------------------------------------
Nursing Home -- 3.3%
- --------------------------------------------------------------------------------
NR NR $ 1,230 Chartiers Valley IDA,
(Beverly Enterprises,
Inc.), 5.375%, 6/1/07 $ 1,247,614
NR NR 1,510 Green County, IDA,
(Beverly Enterprises,
Inc.), 5.75%, 3/1/13 1,501,272
NR NR 2,000 Grove City, Area Hospital
Health Facilities
Authority, (Grove Manor),
6.625%, 8/15/29 2,001,500
NR NR 3,500 Montgomery IDA,
(Advancement of Geriatric
Health Care Institute),
8.375%, 7/1/23 3,781,820
NR NR 1,100 Philadelphia HEFA, (The
Philadelphia Protestant
Home), 6.50%, 7/1/27 1,141,250
NR NR 1,445 Westmoreland County IDA,
(Highland Health Systems,
Inc.), 9.25%, 6/1/22 1,630,683
- --------------------------------------------------------------------------------
$ 11,304,139
- --------------------------------------------------------------------------------
Pooled Loans -- 3.2%
- --------------------------------------------------------------------------------
NR A $ 9,000 Pennsylvania Finance
Authority, Beaver County,
6.60%, 11/1/09 $ 10,077,659
NR AA+ 870 Pennsylvania
Infrastructure Investment
Authority, (Pennvest),
6.80%, 9/1/10 967,910
- --------------------------------------------------------------------------------
$ 11,045,569
- --------------------------------------------------------------------------------
Senior Living / Life Care -- 3.3%
- --------------------------------------------------------------------------------
NR NR $ 4,050 Delaware County, (White
Horse Village), 7.50%,
7/1/18 $ 4,443,660
Aaa BBB+ 3,620 Delaware HFA,
5.75%, 12/15/22 3,963,828
Baa2 BBB+ 3,060 Hazleton HFA, (Hazelton
General Hospital), 5.50%,
7/1/27 3,038,090
- --------------------------------------------------------------------------------
$ 11,445,578
- --------------------------------------------------------------------------------
Total Tax-Exempt Investments -- 100.0%
(identified cost $320,429,951) $343,527,803
- --------------------------------------------------------------------------------
See notes to financial statements
55
<PAGE>
Pennsylvania Municipals Portfolio as of January 31, 1999
PORTFOLIO OF INVESTMENTS (Unaudited) CONT'D
AMT - Interest earned from these securities may be considered a tax preference
item for purposes of the Federal Alternative Minimum Tax.
The portfolio invests primarily in debt securities issued by Pennsylvania
municipalities. The ability of the issuers of the debt securities to meet their
obligations may be affected by the economic developments in a specific industry
or municipality. In order to reduce the risk associated with such economic
developments, at January 31, 1999, 38.4% 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 insured by
financial institution ranged from 2.1% to 14.7%.
(1) Security (or a portion thereof) has been segregated to cover margin
requirements on open financial futures contracts.
(2) Security has been issued as an inverse floater bond.
See notes to financial statements
56
<PAGE>
Texas Municipals Portfolio as of January 31, 1999
PORTFOLIO OF INVESTMENTS (Unaudited)
Tax-Exempt Investments -- 100.0%
Ratings
- ------------------ Principal
Amount
Standard (000's
Moody's & Poor's omitted) Security Value
- --------------------------------------------------------------------------------
Assisted Living -- 3.3%
- --------------------------------------------------------------------------------
NR NR $ 500 Bell County, Health
Facilities, (Care
Institute, Inc., Texas),
9.00%, 11/1/24 $ 572,150
- --------------------------------------------------------------------------------
$ 572,150
- --------------------------------------------------------------------------------
Education -- 1.5%
- --------------------------------------------------------------------------------
A NR $ 240 Brazos, Higher Education
Authority, (AMT), 6.50%,
6/1/04 $ 255,338
- --------------------------------------------------------------------------------
$ 255,338
- --------------------------------------------------------------------------------
Electric Utilities -- 2.8%
- --------------------------------------------------------------------------------
Aa1 AA $ 500 San Antonio, Electric and
Natural Gas Revenue, 4.50%,
2/1/21 $ 471,640
- --------------------------------------------------------------------------------
$ 471,640
- --------------------------------------------------------------------------------
Escrowed / Prerefunded -- 3.8%
- --------------------------------------------------------------------------------
NR NR $ 200 Bexar County, Health
Facilities, (St. Luke's
Lutheran), Escrowed to
Maturity, 7.00%, 5/1/21 $ 256,316
Baa1 BBB 185 Gulf Coast Waste Disposal
Authority, (Champion
International), (AMT),
Prerefunded to 04/01/02,
7.25%, 4/1/17 208,036
Aaa AAA 150 Texas National Research Lab
Super Collider, Escrowed to
Maturity, 6.95%, 12/1/12 183,242
- --------------------------------------------------------------------------------
$ 647,594
- --------------------------------------------------------------------------------
General Obligations -- 15.8%
- --------------------------------------------------------------------------------
Aaa AAA $1,000 Bastrop, Independent School
District, (PSF), 0.00%,
2/15/13 $ 518,630
NR NR 500 Leander, 6.75%, 8/15/16 590,405
Aaa NR 1,000 New Braunfels Independent
School District, (PSF),
0.00%, 2/1/13 519,570
Aa2 AA 690 Texas Veterans' Housing
Assistance U.T., (AMT),
6.70%, 12/1/24 741,778
Aa2 AA 305 Texas Veterans' Housing
Assistance U.T., (AMT),
6.80%, 12/1/23 329,281
- --------------------------------------------------------------------------------
$ 2,699,664
- --------------------------------------------------------------------------------
Hospital -- 7.2%
- --------------------------------------------------------------------------------
NR BBB+ $ 170 Denison Hospital Authority,
(Texoma Medical Center),
7.10%, 8/15/99 $ 173,400
NR BBB+ 330 Denison Hospital Authority,
(Texoma Medical Center),
7.10%, 8/15/04 367,016
A3 NR 100 Harris County, Hospital
District, (Memorial),
7.125%, 6/1/15 113,052
Aaa NR 500 Tarrant County, (Methodist
Health System), 6.00%,
9/1/24 573,485
- --------------------------------------------------------------------------------
$ 1,226,953
- --------------------------------------------------------------------------------
Housing -- 23.6%
- --------------------------------------------------------------------------------
NR AAA $ 80 Bexar County, HFC, 8.10%,
3/1/24 $ 84,450
NR AAA 500 Dallas, HFC, (GNMA),
7.95%, 12/1/23 526,425
NR AAA 150 North Central County, HFC,
(GNMA), 7.875%, 10/1/22 157,454
Aaa AAA 500 Texas Department of Housing
and Community Affairs, (AMT),
5.50%, 1/1/21(1) 508,655
NR AAA 500 Texas Department of Housing
and Community Affairs,
(Meadow Ridge Apartments),
(AMT), 5.55%, 8/1/30 516,320
NR A 500 Texas Department of Housing
and Community Affairs, (NHP
Foundation-Asmara), 6.40%,
1/1/27 540,385
NR AAA 500 Texas Department of Housing
and Community Affairs,
(Pebble Brook Apartments),
(AMT), 5.50%, 12/1/18 518,025
NR A 500 Travis County HFC, (Travis
Station Apartments), 6.75%,
4/1/19 542,135
NR AAA 605 Travis County, HFC, (GNMA)
(FNMA), 7.05%, 12/1/25 646,158
- --------------------------------------------------------------------------------
$ 4,040,007
- --------------------------------------------------------------------------------
Industrial Development Revenue -- 14.4%
- --------------------------------------------------------------------------------
Baa2 BBB- $ 505 Alliance Airport Authority,
(American Airlines), (AMT),
7.50%, 12/1/29 $ 541,784
Baa1 BBB 265 Gulf Coast Waste Disposal
Authority, (Champion
International), (AMT),
7.25%, 4/1/17 286,836
A2 A+ 1,000 Port Corpus Christi,
(Hoechst Celanese Corp.),
(AMT), 6.875%, 4/1/17 1,083,200
NR A 500 Trinity River Authority,
(Texas Instruments), (AMT),
6.20%, 3/1/20 545,760
- --------------------------------------------------------------------------------
$ 2,457,580
- --------------------------------------------------------------------------------
See notes to financial statements
57
<PAGE>
Texas Municipals Portfolio as of January 31, 1999
PORTFOLIO OF INVESTMENTS (Unaudited) CONT'D
Ratings
- ------------------ Principal
Amount
Standard (000's
Moody's & Poor's omitted) Security Value
- --------------------------------------------------------------------------------
Insured-Electric Utilities -- 11.9%
- --------------------------------------------------------------------------------
Aaa AAA $1,000 Austin, Combined Utility,
(AMBAC), 6.75%, 11/15/12(2) $ 1,247,500
Aaa AAA 500 Brazos River Authority
Texas Revenue, (Houston
Lighting and Power Co.),
(AMBAC), (AMT), 5.05%,
11/1/18 509,070
Aaa AAA 500 Lower Colorado River
Authority Junior Lien,
(FGIC), 0.00%, 1/1/12 276,755
- --------------------------------------------------------------------------------
$ 2,033,325
- --------------------------------------------------------------------------------
Insured-Hospital -- 6.5%
- --------------------------------------------------------------------------------
Aaa AAA $ 500 Harris County, HFC,
(Hermann Hospital), (MBIA),
6.375%, 10/1/24 $ 571,485
Aaa AAA 500 Tyler County, HFC, (Mother
Frances Hospital), (FGIC),
6.50%, 7/1/22 549,085
- --------------------------------------------------------------------------------
$ 1,120,570
- --------------------------------------------------------------------------------
Lease Revenue/
Certificates of Participation -- 1.6%
- --------------------------------------------------------------------------------
NR BBB- $ 250 Rio Grande, Independent
School District Lease,
6.75%, 7/15/10 $ 275,995
- --------------------------------------------------------------------------------
$ 275,995
- --------------------------------------------------------------------------------
Nursing Home -- 3.0%
- --------------------------------------------------------------------------------
Aa NR $ 475 Port Arthur, Health
Facilities, (FHA), 6.50%,
8/1/24 $ 512,373
- --------------------------------------------------------------------------------
$ 512,373
- --------------------------------------------------------------------------------
Special Tax Revenue -- 2.9%
- --------------------------------------------------------------------------------
NR AAA $ 500 Puerto Rico, Infrastructure
Financing Authority,
Variable Rate, 7/1/28(3) $ 502,460
- --------------------------------------------------------------------------------
$ 502,460
- --------------------------------------------------------------------------------
Transportation -- 1.7%
- --------------------------------------------------------------------------------
NR NR $ 250 Abia Dev. Corp., (Austin
Cargoport), 9.25%, 10/1/21 $ 286,050
- --------------------------------------------------------------------------------
$ 286,050
- --------------------------------------------------------------------------------
Total Tax-Exempt Investments -- 100.0%
(identified cost $15,541,558) $17,101,699
- --------------------------------------------------------------------------------
AMT - Interest earned from these securities may be considered a tax preference
item for purposes of the Federal Alternative Minimum Tax.
HFC - Housing Finance Corporation
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 January 31, 1999, 18.4% 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 insured by
financial institution ranged from 3.2% to 6.9% of total investments.
(1) When-issued security.
(2) Security (or a portion thereof) has been segregated to cover when-issued
securities.
(3) Security has been issued as an inverse floater bond.
See notes to financial statements
58
<PAGE>
Eaton Vance Municipals Portfolios as of January 31, 1999
FINANCIAL STATEMENTS (Unaudited)
Statements of Assets and Liabilities
As of January 31, 1999
<TABLE>
<CAPTION>
Arizona Portfolio Colorado Portfolio Connecticut Portfolio Michigan Portfolio
- ----------------------------------------------------------------------------------------------------------------------------------
Assets
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Investments --
Identified cost $ 93,999,691 $ 36,958,252 $151,365,923 $108,964,494
Unrealized appreciation 9,655,242 3,410,674 12,673,544 10,349,637
- ----------------------------------------------------------------------------------------------------------------------------------
Investments, at value $103,654,933 $ 40,368,926 $164,039,467 $119,314,131
- ----------------------------------------------------------------------------------------------------------------------------------
Cash $ 462 $ 1,046,101 $ 2,546,238 $ 1,097,128
Receivable for investments sold -- 50,655 -- --
Interest receivable 963,044 507,780 1,756,580 1,650,881
- ----------------------------------------------------------------------------------------------------------------------------------
Total assets $104,618,439 $ 41,973,462 $168,342,285 $122,062,140
- ----------------------------------------------------------------------------------------------------------------------------------
Liabilities
- ----------------------------------------------------------------------------------------------------------------------------------
Payable for when-issued securities $ -- $ 988,856 $ -- $ --
Demand note payable 37,000 -- -- --
Payable for daily variation margin on open -- -- -- 3,188
financial futures contracts
Payable to affiliate for Trustees' fees -- 19 192 --
Other accrued expenses 10,213 11,030 20,636 10,813
- ----------------------------------------------------------------------------------------------------------------------------------
Total liabilities $ 47,213 $ 999,905 $ 20,828 $ 14,001
- ----------------------------------------------------------------------------------------------------------------------------------
Net Assets applicable to investors' interest
in Portfolio $104,571,226 $ 40,973,557 $168,321,457 $122,048,139
- ----------------------------------------------------------------------------------------------------------------------------------
Sources of Net Assets
- ----------------------------------------------------------------------------------------------------------------------------------
Net proceeds from capital contributions and
withdrawals $ 94,915,984 $ 37,562,883 $155,647,913 $111,711,881
Net unrealized appreciation (computed on the
basis of identified cost) 9,655,242 3,410,674 12,673,544 10,336,258
- ----------------------------------------------------------------------------------------------------------------------------------
Total $104,571,226 $ 40,973,557 $168,321,457 $122,048,139
- ----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
See notes to financial statements
59
<PAGE>
Eaton Vance Municipals Portfolios as of January 31, 1999
FINANCIAL STATEMENTS (Unaudited) CONT'D
Statements of Assets and Liabilities
As of January 31, 1999
<TABLE>
<CAPTION>
Minnesota New Jersey Pennsylvania Texas
Portfolio Portfolio Portfolio Portfolio
- ----------------------------------------------------------------------------------------------------------
Assets
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Investments -
Identified cost $ 58,787,913 $300,916,237 $320,429,951 $ 15,541,558
Unrealized appreciation 6,363,173 33,081,331 23,097,852 1,560,141
- ---------------------------------------------------------------------------------------------------------
Investments, at value $ 65,151,086 $333,997,568 $343,527,803 $ 17,101,699
- ---------------------------------------------------------------------------------------------------------
Cash $ 781,783 $ 805 $ 4,520,893 $ 162,604
Receivable for investments sold -- 2,014,821 1,157,463 --
Interest receivable 766,821 3,806,046 4,242,868 246,151
- ---------------------------------------------------------------------------------------------------------
Total assets $ 66,699,690 $339,819,240 $353,449,027 $ 17,510,454
- ---------------------------------------------------------------------------------------------------------
Liabilities
- ---------------------------------------------------------------------------------------------------------
Payable for investments purchased $ -- $ -- $ 3,394,285 $ --
Payable for when-issued securities -- -- -- 500,000
Demand note payable -- 2,305,000 -- --
Payable for daily variation margin on
open financial futures contracts -- -- 9,000 --
Payable to affiliate for Trustees' 88 243 -- --
fees
Other accrued expenses 9,176 49,468 802 1,429
- ---------------------------------------------------------------------------------------------------------
Total liabilities $ 9,264 $ 2,354,711 $ 3,404,087 $ 501,429
- ---------------------------------------------------------------------------------------------------------
Net Assets applicable to investors'
interest in Portfolio $ 66,690,426 $337,464,529 $350,044,940 $ 17,009,025
- ---------------------------------------------------------------------------------------------------------
Sources of Net Assets
- ---------------------------------------------------------------------------------------------------------
Net proceeds from capital
contributions and withdrawals $ 60,327,253 $304,383,198 $326,984,864 $ 15,448,884
Net unrealized appreciation (computed
on the basis of identified cost) 6,363,173 33,081,331 23,060,076 1,560,141
- ---------------------------------------------------------------------------------------------------------
Total $ 66,690,426 $337,464,529 $350,044,940 $ 17,009,025
- ---------------------------------------------------------------------------------------------------------
</TABLE>
See notes to financial statements
60
<PAGE>
Eaton Vance Municipals Portfolios as of January 31, 1999
FINANCIAL STATEMENTS(Unaudited) CONT'D
Statements of Operations
For the Six Months Ended January 31, 1999
<TABLE>
<CAPTION>
Arizona Colorado Connecticut Michigan
Portfolio Portfolio Portfolio Portfolio
- ---------------------------------------------------------------------------------------------------------
Investment Income
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Interest $ 2,937,107 $ 1,159,174 $ 4,671,434 $ 3,528,099
- ---------------------------------------------------------------------------------------------------------
Total investment income $ 2,937,107 $ 1,159,174 $ 4,671,434 $ 3,528,099
- ---------------------------------------------------------------------------------------------------------
Expenses
- ---------------------------------------------------------------------------------------------------------
Investment adviser fee $ 198,427 $ 48,910 $ 343,632 $ 249,863
Trustees fees and expenses 5,476 1,025 8,667 5,426
Custodian fee 22,428 20,178 46,124 36,002
Legal and accounting services 24,212 19,007 25,174 23,971
Miscellaneous 3,755 3,932 8,482 11,176
- ---------------------------------------------------------------------------------------------------------
Total expenses $ 254,298 $ 93,052 $ 432,079 $ 326,438
- ---------------------------------------------------------------------------------------------------------
Deduct --
Reduction of custodian fee $ -- $ 7,923 $ 22,049 $ --
- ---------------------------------------------------------------------------------------------------------
Total expense reductions $ -- $ 7,923 $ 22,049 $ --
- ---------------------------------------------------------------------------------------------------------
Net expenses $ 254,298 $ 85,129 $ 410,030 $ 326,438
- ---------------------------------------------------------------------------------------------------------
Net investment income $ 2,682,809 $ 1,074,045 $ 4,261,404 $ 3,201,661
- ---------------------------------------------------------------------------------------------------------
Realized and Unrealized Gain (Loss)
- ---------------------------------------------------------------------------------------------------------
Net realized gain (loss) --
Investment transactions (identified
cost basis) $ 984,906 $ 348,355 $ 860,208 $ 1,969,076
Financial futures contracts (132,991) (57,485) (256,635) (174,009)
- ---------------------------------------------------------------------------------------------------------
Net realized gain $ 851,915 $ 290,870 $ 603,573 $ 1,795,067
- ---------------------------------------------------------------------------------------------------------
Change in unrealized appreciation
(depreciation) --
Investments (identified cost basis) $ 496,477 $ 112,098 $ 1,898,051 $(568,492)
Financial futures contracts 30,843 1,935 8,127 21,357
- ---------------------------------------------------------------------------------------------------------
Net change in unrealized appreciation
(depreciation) $ 527,320 $ 114,033 $ 1,906,178 $(547,135)
- ---------------------------------------------------------------------------------------------------------
Net realized and unrealized gain $ 1,379,235 $ 404,903 $ 2,509,751 $ 1,247,932
- ---------------------------------------------------------------------------------------------------------
Net increase in net assets
from operations $ 4,062,044 $ 1,478,948 $ 6,771,155 $ 4,449,593
- ---------------------------------------------------------------------------------------------------------
</TABLE>
See notes to financial statements
61
<PAGE>
Eaton Vance Municipals Portfolios as of January 31, 1999
FINANCIAL STATEMENTS (Unaudited) CONT'D
Statements of Operations
For the Six Months Ended January 31, 1999
<TABLE>
<CAPTION>
Minnesota New Jersey Pennsylvania Texas
Portfolio Portfolio Portfolio Portfolio
- ---------------------------------------------------------------------------------------------------------
Investment Income
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Interest $ 1,916,165 $ 9,912,105 $ 10,535,275 $ 505,707
- ---------------------------------------------------------------------------------------------------------
Total investment income $ 1,916,165 $ 9,912,105 $ 10,535,275 $ 505,707
- ---------------------------------------------------------------------------------------------------------
Expenses
- ---------------------------------------------------------------------------------------------------------
Investment adviser fee $ 111,463 $ 754,116 $ 802,505 $ 13,697
Trustees fees and expenses 4,847 13,496 11,657 328
Custodian fee 23,165 77,021 73,665 7,668
Legal and accounting services 22,866 37,675 36,311 16,593
Miscellaneous 9,091 26,388 16,655 1,571
- ---------------------------------------------------------------------------------------------------------
Total expenses $ 171,432 $ 908,696 $ 940,793 $ 39,857
- ---------------------------------------------------------------------------------------------------------
Deduct --
Reduction of custodian fee $ 6,365 $ 19,180 $ 59,442 $ 2,598
- ---------------------------------------------------------------------------------------------------------
Total expense reductions $ 6,365 $ 19,180 $ 59,442 $ 2,598
- ---------------------------------------------------------------------------------------------------------
Net expenses $ 165,067 $ 889,516 $ 881,351 $ 37,259
- ---------------------------------------------------------------------------------------------------------
Net investment income $ 1,751,098 $ 9,022,589 $ 9,653,924 $ 468,448
- ---------------------------------------------------------------------------------------------------------
Realized and Unrealized Gain (Loss)
- ---------------------------------------------------------------------------------------------------------
Net realized gain (loss) --
- ---------------------------------------------------------------------------------------------------------
Investment transactions (identified
cost basis) $ 645,562 $ 3,701,449 $ 4,291,412 $ 143,681
Financial futures contracts (71,267) (95,687) (491,628) --
- ---------------------------------------------------------------------------------------------------------
Net realized gain $ 574,295 $ 3,605,762 $ 3,799,784 $ 143,681
- ---------------------------------------------------------------------------------------------------------
Change in unrealized appreciation
(depreciation) --
Investments (identified cost basis) $ 519,979 $ 219,872 $(2,278,534) $ 88,042
Financial futures contracts 11,880 59,400 60,300 --
- ---------------------------------------------------------------------------------------------------------
Net change in unrealized appreciation
(depreciation) $ 531,859 $ 279,272 $(2,218,234) $ 88,042
- ---------------------------------------------------------------------------------------------------------
Net realized and unrealized gain $ 1,106,154 $ 3,885,034 $ 1,581,550 $ 231,723
- ---------------------------------------------------------------------------------------------------------
Net increase in net assets from
operations $ 2,857,252 $ 12,907,623 $ 11,235,474 $ 700,171
- ---------------------------------------------------------------------------------------------------------
</TABLE>
See notes to financial statements
62
<PAGE>
Eaton Vance Municipals Portfolios as of January 31, 1999
FINANCIAL STATEMENTS (Unaudited) CONT'D
Statements of Changes in Net Assets
For the Six Months Ended January 31, 1999
<TABLE>
<CAPTION>
Increase (Decrease) in Net Arizona Colorado Connecticut Michigan
Assets Portfolio Portfolio Portfolio Portfolio
- ---------------------------------------------------------------------------------------------------------
From operations--
<S> <C> <C> <C> <C>
Net investment income $ 2,682,809 $ 1,074,045 $ 4,261,404 $ 3,201,661
Net realized gain 851,915 290,870 603,573 1,795,067
Net change in unrealized
appreciation (depreciation) 527,320 114,033 1,906,178 (547,135)
- ---------------------------------------------------------------------------------------------------------
Net increase in net assets from
operations $ 4,062,044 $ 1,478,948 $ 6,771,155 $ 4,449,593
- ---------------------------------------------------------------------------------------------------------
Capital transactions --
Contributions $ 7,966,980 $ 2,821,500 $ 8,805,872 $ 3,279,996
Withdrawals (10,549,904) (3,128,091) (12,210,458) (15,917,918)
- ---------------------------------------------------------------------------------------------------------
Net decrease in net assets from
capital transactions $ (2,582,924) $ (306,591) $ (3,404,586) $ (12,637,922)
- ---------------------------------------------------------------------------------------------------------
Net increase (decrease) in net
assets $ 1,479,120 $ 1,172,357 $ 3,366,569 $ (8,188,329)
- ---------------------------------------------------------------------------------------------------------
Net Assets
- ---------------------------------------------------------------------------------------------------------
At beginning of period $ 103,092,106 $ 39,801,200 $ 164,954,888 $ 130,236,468
- ---------------------------------------------------------------------------------------------------------
At end of period $ 104,571,226 $ 40,973,557 $ 168,321,457 $ 122,048,139
- ---------------------------------------------------------------------------------------------------------
</TABLE>
See notes to financial statements
63
<PAGE>
Eaton Vance Municipals Portfolios as of January 31, 1999
FINANCIAL STATEMENTS (Unaudited) CONT'D
Statements of Changes in Net Assets
For the Six Months Ended January 31, 1999
<TABLE>
<CAPTION>
Increase (Decrease) in Net Minnesota New Jersey Pennsylvania Texas
Assets Portfolio Portfolio Portfolio Portfolio
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
From operations--
Net investment income $ 1,751,098 $ 9,022,589 $ 9,653,924 $ 468,448
Net realized gain 574,295 3,605,762 3,799,784 143,681
Net change in unrealized
appreciation (depreciation) 531,859 279,272 (2,218,234) 88,042
- ---------------------------------------------------------------------------------------------------------
Net increase in net assets from
operations $ 2,857,252 $ 12,907,623 $ 11,235,474 $ 700,171
- ---------------------------------------------------------------------------------------------------------
Capital transactions --
Contributions $ 3,791,313 $ 22,866,879 $ 17,261,685 $ 406,684
Withdrawals (6,941,816) (26,939,111) (37,984,094) (1,935,317)
- ---------------------------------------------------------------------------------------------------------
Net decrease in net assets from
capital transactions $ (3,150,503) $ (4,072,232) $ (20,722,409) $ (1,528,633)
- ---------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets $ (293,251) $ 8,835,391 $ (9,486,935) $ (828,462)
- ---------------------------------------------------------------------------------------------------------
Net Assets
- ---------------------------------------------------------------------------------------------------------
At beginning of period $ 66,983,677 $ 328,629,138 $ 359,531,875 $ 17,837,487
- ---------------------------------------------------------------------------------------------------------
At end of period $ 66,690,426 $ 337,464,529 $ 350,044,940 $ 17,009,025
- ---------------------------------------------------------------------------------------------------------
</TABLE>
See notes to financial statements
64
<PAGE>
Eaton Vance Municipals Portfolios as of January 31, 1999
FINANCIAL STATEMENTS CONT'D
Statements of Changes in Net Assets
For the Year Ended July 31, 1998
<TABLE>
<CAPTION>
Increase (Decrease) in Net Arizona Colorado Connecticut Michigan
Assets Portfolio Portfolio Portfolio Portfolio
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
From operations--
Net investment income $ 5,610,913 $ 2,226,153 $ 8,810,104 $ 7,237,297
Net realized gain (loss) 2,209,801 468,233 (472,006) 2,386,197
Net change in unrealized (945,220) (390,688) 1,757,677 (1,160,625)
appreciation (depreciation)
- ---------------------------------------------------------------------------------------------------------
Net increase in net assets from
operations $ 6,875,494 $ 2,303,698 $ 10,095,775 $ 8,462,869
- ---------------------------------------------------------------------------------------------------------
Capital transactions --
Contributions $ 8,495,182 $ 4,707,220 $ 9,761,887 $ 5,251,473
Withdrawals (24,750,363) (9,834,162) (29,880,364) (33,701,520)
- ---------------------------------------------------------------------------------------------------------
Net decrease in net assets from
capital transactions $ (16,255,181) $ (5,126,942) $ (20,118,477) $ (28,450,047)
- ---------------------------------------------------------------------------------------------------------
Net decrease in net assets $ (9,379,687) $ (2,823,244) $ (10,022,702) $ (19,987,178)
- ---------------------------------------------------------------------------------------------------------
Net Assets
- ---------------------------------------------------------------------------------------------------------
At beginning of year $ 112,471,793 $ 42,624,444 $ 174,977,590 $ 150,223,646
- ---------------------------------------------------------------------------------------------------------
At end of year $ 103,092,106 $ 39,801,200 $ 164,954,888 $ 130,236,468
- ---------------------------------------------------------------------------------------------------------
</TABLE>
See notes to financial statements
65
<PAGE>
Eaton Vance Municipals Portfolios as of January 31, 1999
FINANCIAL STATEMENTS CONT'D
Statements of Changes in Net Assets
For the Year Ended July 31, 1998
<TABLE>
<CAPTION>
Increase (Decrease) in Net Minnesota New Jersey Pennsylvania Texas
Assets Portfolio Portfolio Portfolio Portfolio
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
From operations --
Net investment income $ 3,612,278 $ 18,732,197 $ 21,632,540 $ 1,099,441
Net realized gain 701,035 1,707,025 2,080,757 476,323
Net change in unrealized
appreciation (depreciation) (236,413) 983,456 (7,214,291) (276,213)
- ---------------------------------------------------------------------------------------------------------
Net increase in net assets from
operations $ 4,076,900 $ 21,422,678 $ 16,499,006 $ 1,299,551
- ---------------------------------------------------------------------------------------------------------
Capital transactions --
Contributions $ 4,912,748 $ 28,452,460 $ 23,151,071 $ 710,511
Withdrawals (12,679,645) (74,018,070) (82,338,942) (5,848,716)
- ---------------------------------------------------------------------------------------------------------
Net decrease in net assets from
capital transactions $ (7,766,897) $ (45,565,610) $ (59,187,871) $ (5,138,205)
- ---------------------------------------------------------------------------------------------------------
Net decrease in net assets $ (3,689,997) $ (24,142,932) $ (42,688,865) $ (3,838,654)
- ---------------------------------------------------------------------------------------------------------
Net Assets
- ---------------------------------------------------------------------------------------------------------
At beginning of year $ 70,673,674 $ 352,772,070 $ 402,220,740 $ 21,676,141
- ---------------------------------------------------------------------------------------------------------
At end of year $ 66,983,677 $ 328,629,138 $ 359,531,875 $ 17,837,487
- ---------------------------------------------------------------------------------------------------------
</TABLE>
See notes to financial statements
66
<PAGE>
Eaton Vance Municipals Portfolios as of January 31, 1999
FINANCIAL STATEMENTS CONT'D
Supplementary Data
<TABLE>
<CAPTION>
Arizona Portfolio
---------------------------------------------------------------------------------------------
Year Ended
----------------------------------------------------------------------------
Six Months Ended July 31,
January 31, 1999 ------------------------------------------------------------------ Sept. 30,
(Unaudited) 1998 1997 1996 1995 1994(1) 1993(2)
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Ratios to average daily net assets
- -----------------------------------------------------------------------------------------------------------------------------------
Expenses (3) 0.48%(4) 0.50% 0.50% 0.51% 0.52% 0.46%(4) 0.42%(4)
Expenses after custodian fee
reduction 0.48%(4) 0.48% 0.49% 0.50% -- -- --
Net investment income 5.08%(4) 5.27% 5.56% 5.53% 5.81% 5.43%(4) 5.46%(4)
Portfolio Turnover 19% 23% 10% 18% 22% 23% 107%
- -----------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period (000's
omitted) $ 104,571 $ 103,092 $ 112,472 $ 129,862 $ 144,521 $ 154,068 $ 133,539
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) For the ten-month period ended July 31, 1994.
(2) For the period from the start of business, February 1, 1993, to September
30, 1993.
(3) The expense ratios for the year ended July 31, 1996 and periods thereafter
have been adjusted to reflect a change in reporting requirements. The new
reporting guidelines require the Portfolio to increase its expense ratio by
the effect of any expense offset arrangements with its service providers.
The expense ratios for each of the prior periods have not been adjusted to
reflect this change.
(4) Annualized.
See notes to financial statements
67
<PAGE>
Eaton Vance Municipals Portfolios as of January 31, 1999
FINANCIAL STATEMENTS CONT'D
Supplementary Data
<TABLE>
<CAPTION>
Colorado Portfolio
----------------------------------------------------------------------------------------------
Year Ended
------------------------------------------------------------------------------
Six Months Ended July 31,
January 31, 1999------------------------------------------------------------------- Sept. 30,
(Unaudited) 1998 1997 1996 1995 1994(1) 1993(2)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Ratios to average daily net assets +
- ------------------------------------------------------------------------------------------------------------------------------------
Net expenses (3) 0.46%(4) 0.40% 0.40% 0.40% 0.25% 0.02%(4) 0.06%(4)
Net expenses after custodian fee 0.42%(4) 0.37% 0.36% 0.36% -- -- --
reduction
Net investment income 5.30%(4) 5.49% 5.86% 5.75% 6.05% 5.73%(4) 5.60%(4)
Portfolio Turnover 15% 18% 14% 53% 52% 23% 10%
- ------------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period (000's
omitted) $40,974 $39,801 $42,624 $45,416 $46,077 $44,399 $24,346
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
+ The operating expenses of the Portfolio may reflect a reduction of the
investment adviser fee, an allocation of expenses to the Investment Adviser,
or both. Had such action not been taken, the ratios would have been as
follows:
<TABLE>
<S> <C> <C> <C> <C>
Expenses (3) 0.42% 0.40% 0.35%(4) 0.35%(4)
Expenses after custodian fee reduction 0.38% -- -- --
Net investment income 5.73% 5.90% 5.40%(4) 5.31%(4)
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) For the ten-month period ended July 31, 1994.
(2) For the period from the start of business, February 1, 1993, to September
30, 1993.
(3) The expense ratios for the year ended July 31, 1996 and periods thereafter
have been adjusted to reflect a change in reporting requirements. The new
reporting guidelines require the Portfolio to increase its expense ratio by
the effect of any expense offset arrangements with its service providers.
The expense ratios for each of the prior periods have not been adjusted to
reflect this change.
(4) Annualized.
See notes to financial statements
68
<PAGE>
Eaton Vance Municipals Portfolios as of January 31, 1999
FINANCIAL STATEMENTS CONT'D
Supplementary Data
<TABLE>
<CAPTION>
Connecticut Portfolio
---------------------------------------------------------------------------------------------
Year Ended
-----------------------------------------------------------------------------
Six Months Ended July 31,
January 31, 1999-------------------------------------------------------------------- Sept.30
(Unaudited) 1998 1997 1996 1995 1994(1) 1993(2)
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Ratios to average daily net assets +
- -----------------------------------------------------------------------------------------------------------------------------------
Expenses (3) 0.51%(4) 0.51% 0.53% 0.52% 0.53% 0.47%(4) 0.46%(4)
Expenses after custodian fee reduction 0.49%(4) 0.50% 0.53% 0.50% -- -- --
Net investment income 5.06%(4) 5.20% 5.50% 5.49% 5.77% 5.40%(4) 5.45%(4)
Portfolio Turnover 10% 7% 11% 23% 29% 10% 10%
- -----------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period (000's
omitted) $168,321 $164,955 $174,978 $187,617 $195,276 $192,038 $159,848
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) For the ten-month period ended July 31, 1994.
(2) For the period from the start of business, February 1, 1993, to September
30, 1993.
(3) The expense ratios for the year ended July 31, 1996 and periods thereafter
have been adjusted to reflect a change in reporting requirements. The new
reporting guidelines require the Portfolio to increase its expense ratio by
the effect of any expense offset arrangements with its service providers.
The expense ratios for each of the prior periods have not been adjusted to
reflect this change.
(4) Annualized.
See notes to financial statements
69
<PAGE>
Eaton Vance Municipals Portfolios as of January 31, 1999
FINANCIAL STATEMENTS CONT'D
Supplementary Data
<TABLE>
<CAPTION>
Michigan Portfolio
----------------------------------------------------------------------------------------------
Year Ended
-----------------------------------------------------------------------------
Six Months Ended July 31,
January 31, 1999 ------------------------------------------------------------------- Sept. 30,
(Unaudited) 1998 1997 1996 1995 1994(1) 1993(2)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Ratios to average daily net assets
- ------------------------------------------------------------------------------------------------------------------------------------
Expenses (3) 0.50%(4) 0.50% 0.52% 0.54% 0.48% 0.47%(4) 0.44%(4)
Expenses after custodian fee reduction 0.50%(4) 0.48% 0.50% 0.52% -- -- --
Net investment income 4.95%(4) 5.19% 5.45% 5.50% 5.85% 5.48%(4) 5.46%(4)
Portfolio Turnover 9% 26% 16% 49% 54% 45% 20%
- ------------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period (000's
omitted) $122,048 $130,236 $150,224 $173,465 $191,263 $204,032 $187,665
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) For the ten-month period ended July 31, 1994.
(2) For the period from the start of business, February 1, 1993, to September
30, 1993.
(3) The expense ratios for the year ended July 31, 1996 and periods thereafter
have been adjusted to reflect a change in reporting requirements. The new
reporting guidelines require the Portfolio to increase its expense ratio by
the effect of any expense offset arrangements with its service providers.
The expense ratios for each of the prior periods have not been adjusted to
reflect this change.
(4) Annualized.
See notes to financial statements
70
<PAGE>
Eaton Vance Municipals Portfolios as of January 31, 1999
FINANCIAL STATEMENTS CONT'D
Supplementary Data
<TABLE>
<CAPTION>
Minnesota Portfolio
---------------------------------------------------------------------------------------------
Year Ended
----------------------------------------------------------------------------
Six Months Ended July 31,
January 31, 1999 ------------------------------------------------------------------- Sept. 30,
(Unaudited) 1998 1997 1996 1995 1994(1) 1993(2)
- -----------------------------------------------------------------------------------------------------------------------------------
Ratios to average daily net assets
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Expenses (3) 0.51%(4) 0.47% 0.47% 0.48% 0.47% 0.45%(4) 0.40%(4)
Expenses after custodian fee reduction 0.49%(4) 0.45% 0.44% 0.46% -- -- --
Net investment income 5.16%(4) 5.28% 5.71% 5.69% 5.83% 5.50%(4) 5.58%(4)
Portfolio Turnover 14% 23% 22% 45% 76% 20% 10%
- -----------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period (000's
omitted) $66,690 $66,984 $70,674 $76,090 $82,968 $84,005 $67,019
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) For the ten-month period ended July 31, 1994.
(2) For the period from the start of business, February 1, 1993, to September
30, 1993.
(3) The expense ratios for the year ended July 31, 1996 and periods thereafter
have been adjusted to reflect a change in reporting requirements. The new
reporting guidelines require the Portfolio to increase its expense ratio by
the effect of any expense offset arrangements with its service providers.
The expense ratios for each of the prior periods have not been adjusted to
reflect this change.
(4) Annualized.
See notes to financial statements
71
<PAGE>
Eaton Vance Municipals Portfolios as of January 31, 1999
FINANCIAL STATEMENTS CONT'D
Supplementary Data
<TABLE>
<CAPTION>
New Jersey Portfolio
---------------------------------------------------------------------------------------------
Year Ended
Six Months Ended ---------------------------------------------------------------------------
January 31, 1999 July 31, Sept.30
------------------------------------------------------------------
(Unaudited) 1998 1997 1996 1995 1994(1) 1993(2)
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Ratios to average daily net assets
- -----------------------------------------------------------------------------------------------------------------------------------
Expenses (3) 0.53%(4) 0.54% 0.54% 0.53% 0.52% 0.50%(4) 0.50%(4)
Expenses after custodian fee reduction 0.52%(4) 0.52% 0.52% 0.52% -- -- --
Net investment income 5.32%(4) 5.52% 5.84% 5.82% 5.96% 5.62%(4) 5.67%(4)
Portfolio Turnover 13% 14% 24% 39% 54% 25% 12%
- -----------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period (000's
omitted) $337,465 $328,629 $352,772 $386,244 $411,038 $423,854 $393,677
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) For the ten-month period ended July 31, 1994.
(2) For the period from the start of business, February 1, 1993, to September
30, 1993.
(3) The expense ratios for the year ended July 31, 1996 and periods thereafter
have been adjusted to reflect a change in reporting requirements. The new
reporting guidelines require the Portfolio to increase its expense ratio by
the effect of any expense offset arrangements with its service providers.
The expense ratios for each of the prior periods have not been adjusted to
reflect this change.
(4) Annualized.
See notes to financial statements
72
<PAGE>
Eaton Vance Municipals Portfolios as of January 31, 1999
FINANCIAL STATEMENTS CONT'D
Supplementary Data
<TABLE>
<CAPTION>
Pennsylvania Portfolio
----------------------------------------------------------------------------------------------
Year Ended
------------------------------------------------------------------------------
Six Months Ended July 31,
January 31, 1999 ------------------------------------------------------------------ Sept. 30,
(Unaudited) 1998 1997 1996 1995 1994(1) 1993(2)
- ------------------------------------------------------------------------------------------------------------------------------------
Ratios to average daily net assets
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Expenses (3) 0.52%(4) 0.54% 0.55% 0.54% 0.49% 0.48%(4) 0.50%(4)
Expenses after custodian fee reduction 0.49%(4) 0.50% 0.51% 0.50% -- -- --
Net investment income 5.38%(4) 5.66% 5.96% 5.90% 6.02% 5.66%(4) 5.71%(4)
Portfolio Turnover 11% 13% 17% 30% 44% 21% 17%
- ------------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period (000's
omitted) $350,045 $359,532 $402,221 $448,182 $502,250 $536,786 $497,001
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) For the ten-month period ended July 31, 1994.
(2) For the period from the start of business, February 1, 1993, to September
30, 1993.
(3) The expense ratios for the year ended July 31, 1996 and periods thereafter
have been adjusted to reflect a change in reporting requirements. The new
reporting guidelines require the Portfolio to increase its expense ratio by
the effect of any expense offset arrangements with its service providers.
The expense ratios for each of the prior periods have not been adjusted to
reflect this change.
(4) Annualized.
See notes to financial statements
73
<PAGE>
Eaton Vance Municipals Portfolios as of January 31, 1999
FINANCIAL STATEMENTS CONT'D
Supplementary Data
<TABLE>
<CAPTION>
Texas Portfolio
---------------------------------------------------------------------------------------
Year Ended
---------------------------------------------------------------------
Six Months Ended July 31,
January 31, 1999 ------------------------------------------------------- Sept. 30,
(Unaudited) 1998 1997 1996 1995 1994(1) 1993(2)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Ratios to average daily net assets+
- ------------------------------------------------------------------------------------------------------------------------------------
Net expenses (3) 0.46%(4) 0.38% 0.37% 0.32% 0.08% 0%(4) 0.03%(4)
Net expenses after custodian fee reduction 0.43%(4) 0.35% 0.35% 0.27% -- -- --
Net investment income 5.38%(4) 5.58% 5.79% 5.81% 6.20% 5.69%(4) 5.82%(4)
Portfolio Turnover 29% 17% 17% 39% 49% 27% 8%
- ------------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period (000's omitted) $17,009 $17,837 $21,676 $24,367 $28,227 $27,589 $16,029
- ------------------------------------------------------------------------------------------------------------------------------------
+ The operating expenses of the Portfolio may reflect a reduction of the investment adviser fee, an allocation of expenses to the
Investment Adviser, or both. Had such action not been taken, the ratios would have been as follows:
Expenses (3) 0.42% 0.35% 0.37%(4) 0.42%(4)
Expenses after custodian fee reduction 0.37% -- -- --
Net investment income 5.71% 5.93% 5.32%(4) 5.43%(4)
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) For the ten-month period ended July 31, 1994.
(2) For the period from the start of business, February 1, 1993, to September
30, 1993.
(3) The expense ratios for the year ended July 31, 1996 and periods thereafter
have been adjusted to reflect a change in reporting requirements. The new
reporting guidelines require the Portfolio to increase its expense ratio by
the effect of any expense offset arrangements with its service providers.
The expense ratios for each of the prior periods have not been adjusted to
reflect this change.
(4) Annualized.
See notes to financial statements
74
<PAGE>
Eaton Vance Municipals Portfolios as of January 31, 1999
NOTES TO FINANCIAL STATEMENTS (Unaudited)
1 Significant Accounting Policies
------------------------------------------------------------------------------
Arizona Municipals Portfolio (Arizona Portfolio), Colorado Municipals
Portfolio (Colorado Portfolio), Connecticut Municipals Portfolio (Connecticut
Portfolio), Michigan Municipals Portfolio (Michigan Portfolio), Minnesota
Municipals Portfolio (Minnesota Portfolio), New Jersey Municipals Portfolio
(New Jersey Portfolio), Pennsylvania Municipals Portfolio (Pennsylvania
Portfolio) and Texas Municipals 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 and options on
futures contracts listed on commodity exchanges are valued at closing
settlement prices. Over-the-counter options on financial futures contracts are
normally valued at the mean between the latest bid and asked 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
is 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, deduction 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.
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, a Portfolio may not achieve the anticipated benefits of the
financial futures contracts and may realize a loss.
F Options on Financial Futures Contracts -- Upon the purchase of a put option
on a financial futures contract by a Portfolio, the premium paid is recorded
as an investment, the value of which is marked-to-market daily. When a
purchased option expires, a Portfolio will realize a loss in the amount of the
cost of the option. When a Portfolio enters into a closing sale transaction,
the Portfolio will realize a gain or loss depending on whether the sales
proceeds from the closing sale transaction are greater or less than the cost
of the option. When a Portfolio exercises a put option, settlement is made in
cash. The risk associated with purchasing options is limited to the premium
originally paid.
G When-issued and Delayed Delivery Transactions -- The Portfolios may engage
in when-issued or delayed delivery transactions. The Portfolios record when-
issued securities on trade date and maintain 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 earning interest on settlement date.
75
<PAGE>
Eaton Vance Municipals Portfolios as of January 31, 1999
NOTES TO FINANCIAL STATEMENTS (Unaudited) CONT'D
H Other -- Investment transactions are accounted for on a trade date basis.
I Expense Reduction -- Investors Bank & Trust Company (IBT) 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. All significant credit
balances used to reduce each Portfolio's custodian fees are reported as a
reduction of expenses in the Statement of Operations.
J Use of Estimates -- The preparation of financial statements in conformity
with generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities at the date of the financial statements and the reported amounts
of revenue and expense during the reporting period. Actual results could
differ from those estimates.
K Interim Financial Statements -- The interim financial statements relating to
January 31, 1999 and for the six months then ended have not been audited by
independent certified public accountants, but in the opinion of the
Portfolio's management, reflect all adjustments, consisting only of normal
recurring adjustments, necessary for the fair presentation of the financial
statements.
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 six months ended January 31, 1999, each Portfolio paid advisory fees
as follows:
Portfolio Amount Effective Rate*
------------------------------------------------------------------------------
Arizona $ 198,427 0.38%
Colorado 48,910 0.24%
Connecticut 343,632 0.41%
Michigan 249,863 0.39%
Portfolio Amount Effective Rate*
------------------------------------------------------------------------------
Minnesota 111,463 0.33%
New Jersey 754,116 0.44%
Pennsylvania 793,351 0.44%
Texas 13,697 0.16%
*Advisory fees paid as a percentage of average daily net assets
(annualized).
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.
Trustees of the Portfolios 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
six months ended January 31, 1999, no significant amounts have been deferred.
Certain of the officers and Trustees of the Portfolios are officers and
directors/trustees of the above organizations.
3 Investments
------------------------------------------------------------------------------
Purchases and sales of investments, other than U.S. Government securities,
purchased options and short-term obligations, for the six months ended
January 31, 1999 were as follows:
Arizona Portfolio
------------------------------------------------------------------------------
Purchases $20,275,350
Sales 20,051,670
Colorado Portfolio
------------------------------------------------------------------------------
Purchases $ 6,141,746
Sales 5,758,897
Connecticut Portfolio
------------------------------------------------------------------------------
Purchases $16,726,710
Sales 17,903,428
Michigan Portfolio
------------------------------------------------------------------------------
Purchases $11,856,354
Sales 24,739,308
Minnesota Portfolio
------------------------------------------------------------------------------
Purchases $ 9,132,857
Sales 11,138,563
76
<PAGE>
Eaton Vance Municipals Portfolios as of January 31, 1999
NOTES TO FINANCIAL STATEMENTS (Unaudited) CONT'D
New Jersey Portfolio
------------------------------------------------------------------------------
Purchases $ 46,330,560
Sales 41,915,386
Pennsylvania Portfolio
------------------------------------------------------------------------------
Purchases $ 37,461,416
Sales 49,271,879
Texas Portfolio
------------------------------------------------------------------------------
Purchases $ 4,930,646
Sales 5,557,248
4 Federal Income Tax Basis of Investments
------------------------------------------------------------------------------
The cost and unrealized appreciation (depreciation) in value of the
investments owned by each Portfolio at January 31, 1999, as computed on a
federal income tax basis, are as follows:
Arizona Portfolio
------------------------------------------------------------------------------
Aggregate Cost $ 93,999,691
------------------------------------------------------------------------------
Gross unrealized appreciation $ 9,688,949
Gross unrealized depreciation (33,707)
------------------------------------------------------------------------------
Net unrealized appreciation $ 9,655,242
------------------------------------------------------------------------------
Colorado Portfolio
------------------------------------------------------------------------------
Aggregate Cost $ 36,958,252
------------------------------------------------------------------------------
Gross unrealized appreciation $ 3,424,660
Gross unrealized depreciation (13,986)
------------------------------------------------------------------------------
Net unrealized appreciation $ 3,410,674
------------------------------------------------------------------------------
Connecticut Portfolio
------------------------------------------------------------------------------
Aggregate Cost $151,365,923
------------------------------------------------------------------------------
Gross unrealized appreciation $ 12,684,807
Gross unrealized depreciation (11,263)
------------------------------------------------------------------------------
Net unrealized appreciation $ 12,673,544
------------------------------------------------------------------------------
Michigan Portfolio
------------------------------------------------------------------------------
Aggregate Cost $108,964,494
------------------------------------------------------------------------------
Gross unrealized appreciation $ 10,440,870
Gross unrealized depreciation (91,233)
------------------------------------------------------------------------------
Net unrealized appreciation $ 10,349,637
------------------------------------------------------------------------------
Minnesota Portfolio
------------------------------------------------------------------------------
Aggregate Cost $ 58,787,913
------------------------------------------------------------------------------
Gross unrealized appreciation $ 6,363,173
Gross unrealized depreciation --
------------------------------------------------------------------------------
Net unrealized appreciation $ 6,363,173
------------------------------------------------------------------------------
New Jersey Portfolio
------------------------------------------------------------------------------
Aggregate Cost $300,916,237
------------------------------------------------------------------------------
Gross unrealized appreciation $ 33,537,654
Gross unrealized depreciation (456,323)
------------------------------------------------------------------------------
Net unrealized appreciation $ 33,081,331
------------------------------------------------------------------------------
Pennsylvania Portfolio
------------------------------------------------------------------------------
Aggregate Cost $320,429,951
------------------------------------------------------------------------------
Gross unrealized appreciation $ 31,110,324
Gross unrealized depreciation (8,012,472)
------------------------------------------------------------------------------
Net unrealized appreciation $ 23,097,852
------------------------------------------------------------------------------
Texas Portfolio
------------------------------------------------------------------------------
Aggregate Cost $ 15,541,558
------------------------------------------------------------------------------
Gross unrealized appreciation $ 1,563,074
Gross unrealized depreciation (2,933)
------------------------------------------------------------------------------
Net unrealized appreciation $ 1,560,141
------------------------------------------------------------------------------
5 Line of Credit
------------------------------------------------------------------------------
The Portfolios participate with other portfolios and funds managed by BMR and
EVM and their affiliates in a committed $130 million unsecured line of credit
agreement
77
<PAGE>
Eaton Vance Municipals Portfolios as of January 31, 1999
NOTES TO FINANCIAL STATEMENTS (Unaudited) CONT'D
with a group of banks. Borrowings will be made by the portfolios or funds
solely to facilitate the handling of unusual and/or unanticipated short-term
cash requirements. Interest is charged to each portfolio or fund based on its
borrowings at an amount above either the Eurodollar rate or Federal Funds
rate. In addition, a fee computed at an annual rate of 0.10% on the daily
unused portion of the facility is allocated among the participating portfolios
and funds at the end of each quarter. At January 31, 1999, the Arizona
Portfolio and New Jersey Portfolio had balances outstanding pursuant to this
line of credit of $37,000 and $2,305,000 respectively. The Portfolios did not
have any significant borrowings or allocated fees during the six months ended
January 31, 1999.
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 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.
A summary of obligations under these financial instruments at January 31,
1999, is as follows:
Futures
Contracts
Expiration Net Unrealized
Portfolio Date Contracts Position Depreciation
------------------------------------------------------------------------------
Michigan 3/99 17 U.S. Treasury Bonds Short $13,379
------------------------------------------------------------------------------
Pennsylvania 3/99 48 U.S. Treasury Bonds Short 37,776
------------------------------------------------------------------------------
At January 31, 1999, the Portfolios had sufficient cash and/or securities to
cover margin requirements on open futures contracts.
78
<PAGE>
Eaton Vance Municipals Portfolio as of January 31, 1999
Municipals Portfolios
Officers
Thomas J. Fetter
President
James B. Hawkes
Vice President and Trustee
Robert B. MacIntosh
Vice President
Portfolio Manager of Minnesota and New Jersey Municipals Portfolios
Cynthia J. Clemson
Vice President and Portfolio Manager of Arizona Municipals Portfolio
William H. Ahern, Jr.
Vice President and Portfolio Manager of Colorado and Connecticut Municipals
Portfolios
Thomas M. Metzold
Vice President and Portfolio Manager of Texas Municipals Portfolio
Timothy T. Browse
Vice President and Portfolio Manager of Michigan and Pennsylvania
Municipals Portfolios
James L. O'Connor
Treasurer
Alan R. Dynner
Secretary
Independent Trustees
Jessica M. Bibliowicz
President and Chief Operating Officer,
John A. Levin & Co.
Director, Baker, Fentress & Company
Donald R. Dwight
President, Dwight Partners, Inc.
Samuel L. Hayes, III
Jacob H. Schiff Professor of Investment Banking, Emeritus, Harvard University
Graduate School of Business Administration
Norton H. Reamer
Chairman and Chief Executive Officer, United Asset Management Corporation
Lynn A. Stout
Professor of Law, Georgetown University Law Center
John L. Thorndike
Formerly Director, Fiduciary Company Incorporated
Jack L. Treynor
Investment Adviser and Consultant
