NUVEEN Exchange-Traded Funds
January 31, 1999
Semiannual Report
Dependable, tax-free income to help you keep more of what you earn.
NAZ
Arizona
NUM
NMP
Michigan
NUO
Ohio
NTX
Texas
<PAGE>
Highlights
As of January 31, 1999
Contents
1 Build Your Wealth Automatically
2 Dear Shareholder
5 NAZ Commentary & Overview
7 NUM and NMP Commentary & Overview
11 NUO Commentary & Overview
13 NTX Commentary & Overview
15 Shareholder Meeting Report
19 Portfolio of Investments
38 Statement of Net Assets
39 Statement of Operations
40 Statement of Changes in Net Assets
42 Notes to Financial Statements
46 Financial Highlights
48 Building Better Portfolios
49 Fund Information
Credit Quality Performance Highlights
================================================================================
Nuveen Arizona Premium Income Municipal Fund, Inc. (NAZ)
o Taxable-equivalent yield of 7.73%*
o One-year total return on net asset value
of 6.40%
o Steady dividend for 24 consecutive months
Pie Chart:
AAA/U.S. Guaranteed 65%
AA 20%
A 5%
BBB/NR 10%
Nuveen Michigan Quality Income Municipal Fund, Inc. (NUM)
o Taxable-equivalent yield of 8.45%*
o One-year total return on net asset value
of 6.41%
o Good credit quality, with 93% of the
fund's investments rated AA or higher
Pie Chart:
AAA/U.S. Guaranteed 77%
AA 16%
A 5%
BBB/NR 2%
Nuveen Michigan Premium Income Municipal Fund, Inc. (NMP)
o Taxable-equivalent yield of 8.38%*
o One-year total return on net asset value
of 6.65%
o Steady dividend for 18 consecutive months
Pie Chart:
AAA/U.S. Guaranteed 60%
AA 27%
A 11%
BBB/NR 2%
Nuveen Ohio Quality Income Municipal Fund, Inc. (NUO)
o Taxable-equivalent yield of 8.43%*
o One-year total return on net asset value
of 6.80%
o Steady or increasing dividends since
the fund's inception
Pie Chart:
AAA/U.S. Guaranteed 70%
AA 14%
A 6%
BBB/NR 10%
Nuveen Texas Quality Income Municipal Fund (NTX)
o Taxable-equivalent yield of 8.32%*
o One-year total return on net asset value
of 5.93%
o Graphic of: 4 stars
Four-star Morningstar Rating(TM)**
Pic Chart:
AAA/U.S. Guaranteed 64%
AA 13%
A 12%
BBB/NR 11%
* For investors in the 31% federal and applicable state income tax bracket.
**Overall rating within the Morningstar Municipal Bond category for the period
ended January 31, 1999. Morningstar proprietary ratings reflect historical
risk-adjusted performance. The ratings are subject to change every month. Past
performance is no guarantee of future results. Morningstar ratings are
calculated from a fund's three-, five- and 10-year average annual returns (if
applicable) in excess of 90-day Treasury bill returns with appropriate fee
adjustments, and a risk factor that reflects fund performance below 90-day
T-bill returns. NTX received 3 stars for the three-year and 4 stars for the
five-year period, respectively. The top 10% of the funds in an investment
class receive 5 stars and the next 22.5% receive 4 stars. The funds were rated
among 195 funds for the three-year period, 191 funds for the five-year period,
and 22 funds for the 10-year period.
See your fund's Performance Overview for more information.
<PAGE>
Sidebar text: Nuveen offers a number of convenient ways to add to your portfolio
and earn the tax-free income you need to achieve your financial goals.
Sidebar text: Nuveen makes reinvesting easy. A phone call is all it takes to set
up your reinvestment account.
Build Your Wealth Automatically
NUVEEN EXCHANGE-TRADED FUNDS DIVIDEND REINVESTMENT PLAN
Your Nuveen Exchange-Traded Fund allows you to conveniently reinvest dividends
and/or capital gains distributions in additional fund shares. If you do not
elect to reinvest distributions, all distributions are paid by check or can be
deposited directly into your bank or brokerage account.
By choosing to reinvest, you'll be able to invest money regularly and
automatically, and watch your investment grow through the power of tax-free
compounding. You'll also benefit from dollar-cost averaging, a technique of
investing at regular intervals, which allows you to build a high-quality,
tax-free portfolio conveniently and cost effectively over time.
EASY AND CONVENIENT
To make recordkeeping easy and convenient, each month you'll receive a statement
showing your total dividends and distributions, the date of investment, the
shares acquired and the price per share, and the total number of shares you own.
Income or capital gains taxes may be payable on dividends or distributions that
are reinvested.
HOW SHARES ARE PURCHASED
The shares you acquire by reinvesting will either be purchased on the open
market or newly issued by the Fund. If the shares are trading at or above net
asset value at the time of valuation, the Fund will issue new shares at the
then-current market price. If the shares are trading at less than net asset
value, shares for your account will be purchased on the open market. Dividends
and distributions received to purchase shares in the open market will normally
be invested shortly after the dividend payment date. No interest will be paid on
dividends and distributions awaiting reinvestment. Because the market price of
shares may increase before purchases are completed, the average purchase price
per share may exceed the market price at the time of valuation, resulting in the
acquisition of fewer shares than if the dividend or distribution had been paid
in shares issued by the fund. A pro rata portion of any applicable brokerage
commissions on open market purchases will be paid by Plan participants. These
commissions usually will be lower than those charged on individual transactions.
FLEXIBILITY
You may, of course, change your distribution option or withdraw from the Plan at
any time, should your needs or situation change. Should you withdraw, you can
receive a certificate for all whole shares credited to your reinvestment account
and cash payment for fractional shares, or cash payment for all reinvestment
account shares, less brokerage commissions and a $2.50 service fee.
You can also reinvest if your shares are registered in the name of a brokerage
firm, bank, or other nominee. Just ask your investment adviser if the firm will
participate on your behalf. If not, it's easy to have the shares registered in
your name and to apply for a reinvestment account directly. Participants whose
shares are registered in the name of one firm may not be able to transfer the
shares to another firm and continue to participate in the Plan.
The Fund reserves the right to amend or terminate the Plan at any time. Although
the Fund reserves the right to amend the Plan to include a service charge
payable by the participants, there is no direct service charge to participants
in the Plan at this time.
For more information on the Nuveen Automatic Reinvestment Plan or to enroll in
or withdraw from the Plan, speak with your financial adviser or call us at
(800) 257-8787.
<PAGE>
Photo of: Timothy R. Schwertfeger
Chairman of the Board
Sidebar text: Wealth takes a lifetime to build. Once achieved, it should
be preserved.
Line chart of: Bond Buyer 25
Dear Shareholder
I'm pleased to announce that over the past 12 months, the Nuveen Exchange-Traded
Funds covered in this report continued to meet their primary objectives of
providing you with attractive levels of tax-free income and after-tax total
returns. The combination of dependable tax-free income and after-tax total
returns illustrates once again that Nuveen's municipal bond funds can serve as
excellent investment options for income-oriented investors.
THE YEAR IN REVIEW
Over the past year, the markets endured bouts of volatility, as the Asian
financial crisis spilled over into emerging markets and affected economies
around the globe. Investors responded by seeking a haven from the uncertainty in
more conservative investments, such as municipal bond funds. To avert a
potential domestic credit crunch and bring some stability to global markets, the
Federal Reserve moved to ease short-term interest rates for the first time in
almost three years. Between the end of September and mid-November 1998, three
successive cuts brought the federal funds rate to 4.75%.
As interest rates trended downward, the competitive yields offered by our
exchange-traded municipal bond funds stimulated investor interest and demand.
The funds continued to represent a bright spot among fixed-income investments,
offering attractive income in a market that places a high premium on yield. In
addition, the funds have generally maintained good levels of call protection,
resulting in relatively stable income streams.
Throughout 1998, the U.S. economy exhibited more strength than had been expected
at the outset, and current conditions indicate that this momentum could
continue. In the coming months, we will continue to watch several key factors
affecting the economy's future, including corporate earnings reports, wage and
employment statistics, the strength of the U.S. dollar, events in international
markets, and any further interest rate indications from the Federal Reserve.
These factors will influence the outlook for fixed-income markets well into
1999.
MUNICIPAL BONDS: A COMPELLING VALUE
Over the past year, rising bond prices, spurred in part by international
investors' strong demand for U.S. dollar-denominated securities, drove yields on
30-year Treasuries to historic lows. With yields on long Treasury bonds pushing
below 5% at times, the yield on the Bond Buyer Revenue Bond Index, an unmanaged
index of long-term municipal revenue bonds, fell just 16 basis points--from
5.33% to 5.17% - compared with the 71-point drop in Treasury yields over the
past 12 months. As of January 31, 1999, the ratio of long-term municipal yields
to 30-year Treasury yields stood at more than 101%, compared with the more
typical range of 86-87%. Over the past six months, this ratio has reached as
high as 104%. For investors, this means that quality long-term municipal bonds
currently offer approximately the same yield as Treasury bonds with comparable
maturities - even before the tax advantages of municipal bonds are taken into
account.
Low interest rates and the strong economy combined to generate high levels of
new issuance and a dramatic increase in the refinancing of existing bonds.
Municipal issuance in 1998 reached $284 billion, up 29% over 1997. In terms of
total municipal issuance, 1998 ranked as the second largest year on record, next
to 1993's $292 billion.
The continued strength of the U.S. economy also produced improvements in the
fundamental financial health of many municipalities and boosted the overall
credit quality of municipal bonds. In 1998, issues upgraded by Moody's
outnumbered downgrades by a margin of 4 to 1, while the comparable ratio at
Standard & Poor's was more than 2 to 1.
Nuveen Expertise Is Key
The solid track record of a proven investment manager plays an important role in
taking advantage of the exceptional values currently available in the municipal
market. The high level of municipal issuance in 1998, for example, highlighted
the value of Nuveen's own in-depth knowledge of the municipal market, as our
portfolio management teams carefully analyzed the flood of issues to select
those securities best suited to help the funds achieve their investment
objectives.
As a further enhancement to our management capabilities, Nuveen has assembled a
strong group of investment managers who are experts in their particular areas of
the market to provide the advantage of their experience and insights. In
addition to Nuveen Advisory Services for tax-free investing, you and your
adviser can rely on other premier Nuveen managers for a wide range of
investments, including Institutional Capital Corporation for value oriented
equity funds and Rittenhouse Financial Services for growth oriented funds. For
more information about these funds, contact your financial adviser for a
prospectus, or call Nuveen at (800) 621-7227. Please read the prospectus
carefully before you invest or send money.
We encourage you to talk with your financial adviser about the ways Nuveen's
expanding selection of investments can help you establish a diversified
portfolio designed to build and sustain long-term financial security. We are
grateful for the confidence you have placed in us, and we intend to continue
earning your trust in the years ahead.
Sincerely,
Timothy R. Schwertfeger
Chairman of the Board
March 15, 1999
Sidebar text: "The solid track record of a proven investment manager plays an
important role in taking advantage of the exceptional values currently available
in the municipal market."
<PAGE>
Nuveen Arizona Premium Income Municipal Fund, Inc. (NAZ)
Portfolio Manager's Comments
Portfolio manager Mike Davern discusses fund performance, key investment
strategies, and the outlook for the Nuveen Arizona Premium Income Municipal
Fund, Inc. (NAZ). Mike, who has 16 years of experience as an investment
professional, including seven years with Nuveen, assumed management
responsibility for NAZ in July 1998 as part of Nuveen's efforts to maximize the
efficient use of staff resources and portfolio manager expertise.
What economic factors have affected the municipal market in Arizona?
Over the past year, economic growth in Arizona has been extremely strong, as the
state followed national trends in economic improvement. Arizona's economy is
based predominantly on services, tourism, and high-tech manufacturing, and
employment growth in these sectors has increased rapidly, placing Arizona among
the top three job growth states over the past several years. Unemployment in
1998 was 4.1%, just under the national average of 4.3%. The biggest challenge
faced by Arizona has been the state's significant economic expansion and
continued population growth, up 21% since 1990. State and local governments
continue to seek ways to meet the increased demand for essential services.
Expectations are that growth in the state over the next several years will
continue in line with national trends.
In 1998, issuance of municipal bonds in Arizona increased 35% over 1997, ahead
of the national average of 29%. This increased supply was met with generally
strong demand, both institutional and individual, particularly on the part of
the large retired population in Arizona. Due to strong economic growth in the
state, Arizona's credit quality has remained very high, and bonds issued by the
state are viewed well in the marketplace.
How did NAZ perform over the past year?
For the 12 months ended January 31, 1999, the total return on net asset value
for the Nuveen Arizona Premium Income Municipal Fund, Inc. (NAZ) was 6.40%,
equivalent to a taxable total return of 9.24% for investors in the combined
34.3% federal and state income tax bracket. In the current low interest rate
environment, good call protection helped support the dividend of NAZ and protect
the income of this fund from erosion. As of January 31, 1999, NAZ had provided
shareholders with 24 consecutive months of steady income.
As interest rates fell over the past year, active demand for Nuveen
Exchange-Traded Funds resulted in generally solid share price performance. For
NAZ, share price performance was very strong over the first 11 months (February
through December 1998) of the 12-month period ended January 31, 1999. However,
market conditions during January 1999 erased much of the fund's previous gains
and lowered its share price. At the same time, strong bond market performance
over the past 12 months boosted NAZ's net asset value (NAV). The combination
resulted in the premium of the fund's market price over NAV narrowing during the
year.
Current Total Return
Market Yield Premium* on Share Price
- --------------------------------------------------------------------------
Taxable 1 Year Ending Taxable
1/31/99 Equivalent** 1/31/98 1/31/99 1/31/99 Equivalent**
- --------------------------------------------------------------------------
NAZ 5.08% 7.73% 5.04% 3.70% 4.78% 7.49%
- --------------------------------------------------------------------------
* Premium represents the difference between the fund's share price and its NAV.
**Taxable-equivalent yield represents the yield on a taxable investment
necessary to equal the yield of the Nuveen fund on an after-tax basis. It is
based on a combined federal and state income tax rate of 34.3%.
Taxable-equivalent total return is based on the annualized total return and a
combined federal and state income tax rate of 34.3%. It represents the return
on a taxable investment necessary to equal the return of the Nuveen fund on an
after-tax basis. For additional information, see the Performance Overview for
NAZ in this report.
What key strategies were used to manage the fund during the past year?
The focus of our management strategies for NAZ continued to be on supporting the
highest level of tax-exempt dividend consistent with capital preservation while
trying to enhance the fund's after-tax total return. Over the past 12 months,
the fund saw little portfolio turnover in terms of proactively adding new bonds
due to the fact that the bonds currently held in this portfolio offer higher
income streams than bonds that can be bought in the market today. All bonds
considered for addition to the portfolio were assessed in terms of coupon, call
protection, maturity, and credit quality to determine whether their structure
would enhance the fund's position.
With less than 2% of its portfolio scheduled to be called before the year 2002,
NAZ offers outstanding call protection, which should provide additional
stability for its dividend. As of January 31, 1999, the portion of the portfolio
invested in pre-refunded or escrowed (U.S. guaranteed) bonds had reached 21%,
benefiting the fund's performance and raising its quality level. The credit
quality of NAZ is very high, with 85% invested in bonds rated AAA and AA.
What is Nuveen's outlook for the future?
Looking ahead for NAZ, our focus will remain on supporting the income stream of
this fund and on purchasing bonds that enhance the fund's position and structure
at attractive prices. We will also look at positioning the fund's duration so
that the fund is better protected against interest rate volatility. Because the
credit spreads for hospital bonds have widened in recent months, we will
consider making selective additions to this sector for our portfolio. A credit
spread represents the difference between lower-rated and higher-rated bonds.
Lower-rated bonds typically pay higher interest rates due to their credit risk.
We may buy lower-rated bonds for the boost in incremental yield, as long as they
are investment grade (at least BBB rated). Selecting the bonds that will help
NAZ meet its goals is an area where Nuveen's expertise - as an experienced
investment manager knowledgeable about the unique aspects of the Arizona
municipal market - can result in added value for our investors.
The current market environment - influenced by low interest rates, benign
inflation, and strong municipal supply - has helped to position municipal bonds
as one of the most compelling values in today's marketplace. Continued
volatility in the equity markets and investors' increasing awareness of the need
for asset allocation rebalancing should result in growing demand for municipal
bond funds. We believe that investors who take advantage of current
opportunities in the municipal market should be rewarded with healthy returns
and attractive yields in the months ahead, as the market recognizes the value of
these quality investments.
<PAGE>
Nuveen Arizona Premium Income Municipal Fund,
Inc. Performance Overview As of January 31, 1999
NAZ
Portfolio Statistics
- --------------------------------------------------
Inception Date 11/92
- --------------------------------------------------
Share Price $16 5/16
- --------------------------------------------------
Net Asset Value $15.73
- --------------------------------------------------
Market Yield 5.08%
- --------------------------------------------------
Taxable-Equivalent Yield (Federal Only)(1) 7.36%
- --------------------------------------------------
Taxable-Equivalent Yield (Federal
and State)(1) 7.73%
- --------------------------------------------------
Fund Net Assets ($000) $98,127
- --------------------------------------------------
Average Weighted Maturity (Years) 15.97
- --------------------------------------------------
Leverage-Adjusted Duration (Years) 7.72
- --------------------------------------------------
Annualized Total Return
On Share Price On NAV
- --------------------------------------------------
1-Year 4.78% 6.40%
- --------------------------------------------------
3-Year 10.43% 6.79%
- --------------------------------------------------
5-Year 7.37% 6.10%
- --------------------------------------------------
Since Inception 7.02% 7.50%
- --------------------------------------------------
Taxable-Equivalent Total Return(2)
On Share Price On NAV
- --------------------------------------------------
1-Year 7.49% 9.24%
- --------------------------------------------------
3-Year 13.40% 9.69%
- --------------------------------------------------
5-Year 10.34% 9.01%
- --------------------------------------------------
Since Inception 9.88% 10.34%
- --------------------------------------------------
Top Five Sectors (as a % of total investments)
U.S. Guaranteed 21%
- --------------------------------------------------
Health Care 12%
- --------------------------------------------------
Utilities 12%
- --------------------------------------------------
Tax Obligation (Limited) 11%
- --------------------------------------------------
Tax Obligation (General) 10%
- --------------------------------------------------
Bar chart:
1997-1998 Monthly Tax-Free Dividends
2/98 0.069
3/98 0.069
4/98 0.069
5/98 0.069
6/98 0.069
7/98 0.069
8/98 0.069
9/98 0.069
10/98 0.069
11/98 0.069
12/98 0.069
1/99 0.069
Line chart:
Share Price Performance
2/6/98 16.063
16.125
16.375
16.25
16
15.813
15.75
16.063
15.75
15.875
15.063
14.875
14.875
16
16
16.063
16.125
15.938
15.938
16.188
16.25
16.313
16.688
16.625
16.438
16.313
16.438
16.625
16.563
16.625
16.375
16.563
16.5
16.625
16.563
16.75
16.75
16.69
16.81
16.94
17.06
16.81
16.88
17.06
17.13
16.69
16.25
16.31
1/31/99 16.3125
Weekly Closing Price
Past performance is not predictive of future results.
1 Taxable-equivalent yield represents the yield on a taxable investment
necessary to equal the yield of the Nuveen fund on an after-tax basis. The
federal only rate is based on the market yield and a federal income tax rate
of 31%. The rate shown for federal and state highlights the added value of
owning shares that are also exempt from state income taxes. It is based on a
combined federal and state income tax rate of 34.3%.
2 Taxable-equivalent total return is based on the annualized total return and a
combined federal and state income tax rate of 34.3%. It represents the return
on a taxable investment necessary to equal the return of the Nuveen fund on an
after-tax basis.
<PAGE>
Nuveen Michigan Exchange-Traded Funds
Portfolio Manager's Comments
Portfolio manager Mike Davern reviews the Michigan municipal market, fund
performance, and key investment strategies for the Nuveen Michigan Quality
Income Municipal Fund, Inc. (NUM) and the Nuveen Michigan Premium Income
Municipal Fund, Inc. (NMP). Mike, who has 16 years of experience as an
investment professional, including seven years with Nuveen, assumed management
responsibility for NUM and NMP in July 1998 as part of Nuveen's efforts to
maximize the efficient use of staff resources and portfolio manager expertise.
What economic factors have affected the municipal market in Michigan?
In 1998, job growth increased at a record pace for the state, resulting in an
unemployment rate of 3.8%, below the national average of 4.3%. Employment growth
in 1999 is expected to continue, although perhaps at a slower pace. As
Michigan's economy diversifies into various types of manufacturing, its
dependence on auto manufacturing is decreasing, although this industry still
exerts the largest influence on the state's economy. Analysts will continue to
watch the current trend toward consolidation in the auto industry closely to
assess its impact on the Michigan economy.
The issuance of municipal bonds in Michigan rose dramatically in 1998, up 65%
over 1997, compared with the national average of 29%. Much of the new supply was
due to infrastructure and educational improvements being undertaken by the
state. This increase in supply was met with generally high demand. The state's
solid economy is reflected in its strong credit characteristics and ratings of
Aa1 by Moody's and AA+ by Standard & Poor's and Fitch. Over the past two years,
all three agencies have upgraded ratings for the state's general obligation
bonds.
How did the Michigan funds perform over the past year?
For the 12 months ended January 31, 1999, the total return on net asset value
for the Nuveen Michigan Quality Income Municipal Fund, Inc. (NUM) was 6.41%,
while the Nuveen Michigan Premium Income Municipal Fund, Inc. (NMP) produced a
total return of 6.65%. These returns are equivalent to taxable total returns of
9.50% and 9.45%, respectively, for investors in the combined 34% federal and
state income tax bracket.
In the current low interest rate environment, good call protection helped
support the dividend of NMP and protect the income of this fund from erosion. As
of January 31, 1999, NMP had provided shareholders with 18 consecutive months of
steady income. However, declining interest rates contributed to a reduction in
the income level of NUM, necessitating a dividend cut in August 1998. As bonds
in the portfolio matured, proceeds had to be reinvested in issues paying
relatively lower interest rates, which reduced the income earned by the fund.
Despite NUM's dividend adjustment, both funds continued to provide competitive
market yields. As interest rates fell over the past year, active demand for
Nuveen Exchange-Traded Funds resulted in generally solid share price
performance. For both NUM and NMP, share price performance was very strong over
the first 11 months of the 12-month period (February through December 1988)
ended January 31, 1999. However, new supply in the Michigan market during
January 1999 temporarily outpaced demand, erasing much of the funds' previous
gains and bringing their share prices lower. At the same time, bond market
performance over the past 12 months helped to maintain NUM's net asset value
(NAV) and to boost that of NMP. As a result, the premium of NUM's market price
over NAV narrowed for the 12-month period, while the discount on NMP's market
price below NAV widened.
Current Total Return
Market Yield Premium/Discount* on Share Price
- --------------------------------------------------------------------------------
Taxable 1 Year Ending Taxable
1/31/99 Equivalent** 1/31/98 1/31/99 1/31/99 Equivalent**
- --------------------------------------------------------------------------------
NUM 5.58% 8.45% 7.41% 2.35% 1.08% 3.95%
- --------------------------------------------------------------------------------
NMP 5.53% 8.38% -2.19% -5.33% 3.34% 6.21%
- --------------------------------------------------------------------------------
* Premium/Discount represents the difference between the fund's share price
and its NAV.
**Taxable-equivalent yield represents the yield on a taxable investment
necessary to equal the yield of the Nuveen fund on an after-tax basis. It is
based on a combined federal and state income tax rate of 34%.
Taxable-equivalent total return is based on the annualized total return and a
combined federal and state income tax rate of 34%. It represents the return on
a taxable investment necessary to equal the return of the Nuveen fund on an
after-tax basis.
For additional information, see the separate Performance Overviews for NUM and
NMP in this report.
<PAGE>
What key strategies were used to manage the funds during the past year?
The focus of our management strategies for NUM and NMP continued to be on
supporting the highest level of tax-exempt dividends consistent with capital
preservation while trying to enhance the funds' after-tax total returns. Over
the past 12 months, the funds saw little portfolio turnover in terms of
proactively adding new bonds due to the fact that the bonds currently held in
these portfolios offer higher income streams than those purchased in the market
today. All bonds considered for addition to these portfolios were assessed in
terms of coupon, call protection, maturity, and credit to determine whether
their structure would enhance the funds' position. The credit quality of the two
funds is exceptionally high, with 93% of NUM and 87% of NMP invested in bonds
rated AAA and AA. NUM has excellent call protection, with just 3% of its
holdings subject to bond calls over next two years. The fund has 20% of its
holdings invested in general obligation bonds, the majority in local school
districts. NUM holds a high proportion of utility sector bonds, including those
issued by the Detroit Edison Company Pollution Control Bonds Project and by the
Michigan South Central Power Agency. These bonds provide an average tax-exempt
yield of 6.7% as well as strong performance.
With no scheduled bond calls in 1999 and 2000 and less than 6% of its portfolio
subject to calls in 2001, NMP also offers excellent call protection, which
should provide additional stability for its dividend. As of January 31, 1999,
the fund had a 19% allocation to the healthcare sector. While hospitals in
Michigan are facing the same problems as hospitals in other states - i.e. rising
medical costs and pressure from health insurers and the government - the
majority of NMP's hospital holdings are either AAA or AA rated, providing
stability for this sector of the fund. The fund also holds 19% of its assets in
electric utilities, or public power bonds. Many of these bonds are long-term
holdings for the fund and offer yields of more than 6%. The sector has performed
well due to high demand for the relatively scarce number of utilities issues.
What is Nuveen's outlook for the future?
Looking ahead for the Michigan funds, our focus will remain on supporting the
income streams of these funds and on purchasing bonds at attractive prices that
enhance their structure. We will also look at positioning the funds' durations
so that the funds are better protected against interest rate volatility. Making
the portfolio decisions that help the funds meet their goals is an area where
Nuveen's expertise - as an experienced investment manager knowledgeable about
the unique aspects of the Michigan municipal market - can result in added value
for our investors.
The current market environment - influenced by low interest rates, benign
inflation, and strong municipal supply - has helped to position municipal bonds
as one of the most compelling values in today's marketplace. Continued
volatility in the equity markets and investors' increasing awareness of the need
for asset allocation rebalancing should result in growing demand for municipal
bond funds. We believe that investors who take advantage of current
opportunities in the municipal market should be rewarded with healthy returns
and attractive yields in the months ahead, as the market recognizes the value of
these quality investments.
<PAGE>
Nuveen Michigan Quality Income Municipal Fund, Inc.
Performance Overview
As of January 31, 1999
NUM
Portfolio Statistics
- --------------------------------------------------
Inception Date 10/91
- --------------------------------------------------
Share Price $16 7/16
- --------------------------------------------------
Net Asset Value $16.06
- --------------------------------------------------
Market Yield 5.58%
- --------------------------------------------------
Taxable-Equivalent Yield (Federal Only)(1) 8.09%
- --------------------------------------------------
Taxable-Equivalent Yield (Federal
and State)(1) 8.45%
- --------------------------------------------------
Fund Net Assets ($000) $263,678
- --------------------------------------------------
Average Weighted Maturity (Years) 15.57
- --------------------------------------------------
Leverage-Adjusted Duration (Years) 7.48
- --------------------------------------------------
Annualized Total Return
On Share Price On NAV
- --------------------------------------------------
1-Year 1.08% 6.41%
- --------------------------------------------------
3-Year 6.86% 6.81%
- --------------------------------------------------
5-Year 6.86% 6.19%
- --------------------------------------------------
Since Inception 7.70% 8.51%
- --------------------------------------------------
Taxable-Equivalent Total Return(2)
On Share Price On NAV
- --------------------------------------------------
1-Year 3.95% 9.50%
- --------------------------------------------------
3-Year 9.93% 10.00%
- --------------------------------------------------
5-Year 10.08% 9.48%
- --------------------------------------------------
Since Inception 10.88% 11.77%
- --------------------------------------------------
Top Five Sectors (as a % total investments)
U.S. Guaranteed 33%
- --------------------------------------------------
Tax Obligation (General) 20%
- --------------------------------------------------
Utilities 16%
- --------------------------------------------------
Healthcare 7%
- --------------------------------------------------
Housing (Multifamily) 5%
- --------------------------------------------------
Bar chart:
1997-1998 Monthly Tax-Free Dividends(3)
2/98 0.0795
3/98 0.0795
4/98 0.0795
5/98 0.0795
6/98 0.0795
7/98 0.0795
8/98 0.0765
9/98 0.0765
10/98 0.0765
11/98 0.0765
12/98 0.0765
1/99 0.0765
Line chart:
Share Price Performance
2/6/98 17.125
17.125
17
16.875
16.875
17.313
16.875
16.5
17
16.938
16.875
16.813
16.875
17
16.875
16.875
17.313
17.375
17.188
17.063
17.188
17.125
17.188
17
17.375
17.188
17
17.125
17
16.625
16.438
16.313
16.188
17
16.5
16.625
16.56
16.75
17.06
17.13
17.25
17.25
17.44
17.5
17.63
16.94
16.56
16.06
1/31/99 16.4375
Weekly Closing Price
Past performance is not predictive of future results.
1 Taxable-equivalent yield represents the yield on a taxable investment
necessary to equal the yield of the Nuveen fund on an after-tax basis. The
federal only rate is based on the market yield and a federal income tax rate
of 31%. The rate shown for federal and state highlights the added value of
owning shares that are also exempt from state income taxes. It is based on a
combined federal and state income tax rate of 34%.
2 Taxable-equivalent total return is based on the annualized total return and a
combined federal and state income tax rate of 34%. It represents the return on
a taxable investment necessary to equal the return of the Nuveen fund on an
after-tax basis.
3 The Fund also paid shareholders taxable distributions in December of $0.0611
per share.
<PAGE>
Nuveen Michigan Premium Income Municipal Fund, Inc.
Performance Overview
As of January 31, 1999
NMP
Portfolio Statistics
- --------------------------------------------------
Inception Date 12/92
- --------------------------------------------------
Share Price $14 3/4
- --------------------------------------------------
Net Asset Value $15.58
- --------------------------------------------------
Market Yield 5.53%
- --------------------------------------------------
Taxable-Equivalent Yield (Federal Only)(1) 8.01%
- --------------------------------------------------
Taxable-Equivalent Yield (Federal
and State)(1) 8.38%
- --------------------------------------------------
Fund Net Assets ($000) $175,739
- --------------------------------------------------
Average Weighted Maturity (Years) 16.01
- --------------------------------------------------
Leverage-Adjusted Duration (Years) 7.95
- --------------------------------------------------
Annualized Total Return
On Share Price On NAV
- --------------------------------------------------
1-Year 3.34% 6.65%
- --------------------------------------------------
3-Year 9.75% 7.38%
- --------------------------------------------------
5-Year 7.07% 6.32%
- --------------------------------------------------
Since Inception 5.62% 7.40%
- --------------------------------------------------
Taxable-Equivalent Total Return(2)
On Share Price On NAV
- --------------------------------------------------
1-Year 6.21% 9.45%
- --------------------------------------------------
3-Year 12.88% 10.24%
- --------------------------------------------------
5-Year 10.25% 9.25%
- --------------------------------------------------
Since Inception 8.63% 10.24%
- --------------------------------------------------
Top Five Sectors (as a % of total investments)
Health Care 19%
- --------------------------------------------------
Utilities 19%
- --------------------------------------------------
Tax Obligation (General) 15%
- --------------------------------------------------
Tax Obligation (Limited) 11%
- --------------------------------------------------
Housing (Multifamily) 9%
- --------------------------------------------------
Bar chart:
1997-1998 Monthly Tax-Free Dividends
2/98 0.068
3/98 0.068
4/98 0.068
5/98 0.068
6/98 0.068
7/98 0.068
8/98 0.068
9/98 0.068
10/98 0.068
11/98 0.068
12/98 0.068
1/99 0.068
Line chart:
Share Price Performance
2/6/98 15
15.188
15.063
15
14.75
14.875
14.688
14.625
14.688
14.813
14.75
14.625
15
14.313
14.438
14.625
14.625
14.688
14.625
14.563
15.188
14.875
14.875
14.813
15
15.188
15.188
15.188
15
15
15.063
14.938
14.938
15.25
15.375
15.188
15.31
15.63
15.69
15.69
15.63
15.88
15.69
15.94
15.63
15.5
15.19
14.75
1/31/99 14.75
Weekly Closing Price
Past performance is not predictive of future results.
1 Taxable-equivalent yield represents the yield on a taxable investment
necessary to equal the yield of the Nuveen fund on an after-tax basis. The
federal only rate is based on the current market yield and a federal income
tax rate of 31%. The rate shown for federal and state highlights the added
value of owning shares that are also exempt from state income taxes. It is
based on a combined federal and state income tax rate of 34%.
2 Taxable-equivalent total return is based on the annualized total return and a
combined federal and state income tax rate of 34%. It represents the return on
a taxable investment necessary to equal the return of the Nuveen fund on an
after-tax basis.
<PAGE>
Nuveen Ohio Quality Income Municipal Fund, Inc. (NUO)
Portfolio Manager's Comments
Portfolio manager Tom Futrell talks about fund performance, key investment
strategies, and the outlook for the Nuveen Ohio Quality Income Municipal Fund,
Inc. (NUO). Tom, a 15-year veteran of Nuveen with management responsibility for
a range of national and state municipal bond funds, assumed management of NUO in
July 1998 as part of Nuveen's efforts to maximize the efficient use of staff
resources and portfolio manager expertise.
What economic factors have affected the municipal market in Ohio?
Ohio, with the seventh largest state economy in the U.S., continues to be a
leader in manufacturing, ranking as the third largest manufacturing state in the
nation. Even with the continued heavy reliance on this sector, Ohio's economy
has improved in terms of diversification, as it expands into construction,
services, and selected high-tech industries. At the end of 1998, unemployment in
the state was 3.9%, below the national average of 4.3% and Ohio's lowest rate in
29 years. In 1999, job growth is expected to lag national trends slightly, with
the strongest growth in the technology, healthcare, and retail sectors. Analysts
will continue to watch the state's strong export activity in manufactured goods,
which provides an exposure to the global economy, for signs of any adverse
effects from the recent international financial turmoil. Overall, the state's
financial position is solid, and its credit quality remains very high, with a
AA+ rating for Ohio's general obligation bonds.In terms of new issue volume,
Ohio remained one of the larger municipal issuers, ranking among the top 10
states in the nation. Over the past 12 months, issuance in the state was fairly
stable, with the majority of new bonds offered by the housing and healthcare
sectors. The state also issued bonds for construction projects and
infrastructure improvements, specifically highways. For the most part, new
issuance was easily absorbed by market demand.
How did NUO perform over the past year?
For the 12 months ended January 31, 1999, the total return on net asset value
(NAV) for the Nuveen Ohio Quality Income Municipal Fund, Inc. (NUO) was 6.80%,
equivalent to a taxable total return of 10.14% for investors in the combined
35.8% federal and state income tax bracket. This strong performance was due in
part to the fund's coupon structure, which consisted of existing bonds in the
portfolio that had higher yields than new bonds that were being offered in the
market during the past year.
In the current low interest rate environment, good call protection helped
support the dividend of NUO and protect the income of this fund from erosion. As
of January 31, 1999, NUO had never reduced its dividend since the fund's
inception in October 1991. In fact, NUO raised its dividend in August 1998.
As interest rates fell over the past year, active demand for Nuveen
Exchange-Traded Funds resulted in generally solid share price performance. For
NUO, share price performance was very strong over the first 11 months (February
through December 1998) of the 12-month period ended January 31, 1999. However,
new supply in the Ohio market during January 1999 temporarily outpaced demand,
erasing much of the fund's previous gains and bringing the share price lower. At
the same time, strong bond market performance over the past 12 months boosted
NUO's net asset value. As a result, the premium of the fund's market price over
NAV narrowed for the year.
Current Total Return
Market Yield Premium* on Share Price
- --------------------------------------------------------------------------------
Taxable 1 Year Ending Taxable
1/31/99 Equivalent** 1/31/98 1/31/99 1/31/99 Equivalent**
- --------------------------------------------------------------------------------
NUO 5.41% 8.43% 10.73% 7.30% 2.96% 5.97%
- --------------------------------------------------------------------------------
*Premium represents the difference between the fund's share price and its NAV.
**Taxable-equivalent yield represents the yield on a taxable investment
necessary to equal the yield of the Nuveen fund on an after-tax basis. It is
based on a combined federal and state income tax rate of 35.8%.
Taxable-equivalent total return is based on the annualized total return and a
combined federal and state income tax rate of 35.8%. It represents the return
on a taxable investment necessary to equal the return of the Nuveen fund on an
after-tax basis.
For additional information, see the Performance Overview for NUO in
this report.
What key strategies were used to manage the fund during the past year?
NUO's portfolio is well positioned as a result of excellent bond selection when
the portfolio was originally assembled in October 1991. Over the past 12 months,
the fund saw little portfolio turnover in terms of proactively adding new bonds
due to the fact that the bonds currently held in the portfolio offer higher
income streams than those that can be purchased in the market today. Our focus
remained on maintaining the portfolio's structure and trying to enhance its
yield. Additions to the portfolio concentrated on income, as we used the
proceeds from pre-refunded bonds called out of the portfolio to invest in the
higher-yielding securities in the Ohio market.
Aside from pre-refunded and escrowed bonds, which represented 24% of the
portfolio, as of January 31, 1999, general obligation bonds, at 15%, provided
the core position of the portfolio. The combination of the general obligation
bonds and our utilities holdings, which made up 9% of the portfolio, contributed
to the fund's strong performance for the 12-month period. Increased supply in
the healthcare sector, which is currently rather volatile due to the bankruptcy
declaration by a group of Philadelphia hospitals under the umbrella of the
Allegheny Health and Education Research Foundation (AHERF) in Pennsylvania,
created additional opportunities to find value at the state level. In the coming
year, healthcare issuers will continue to require close attention. Overall, the
credit quality of NUO reflected the generally high credit rating of the state,
with 84% invested in bonds rated AAA and AA.
What is Nuveen's outlook for the future?
Looking ahead for NUO, our strategies will continue to focus on supporting a
stable income stream for the fund. We anticipate that Ohio's substantial state
tax and the resulting demand for Ohio municipal bonds by individual investors
will continue to create opportunities to sell bonds at good prices and to buy
bonds that work well for the fund over the long term. Our goal in these trades
is always to pick up incremental yield for the fund's shareholders.
Approximately 14% of the portfolio is subject to bond calls by the year 2001. We
believe this offers little risk to the fund's dividend as we have already
anticipated ways to manage through this period. Nuveen's expertise as an
experienced investment manager knowledgeable about the unique aspects of the
Ohio municipal market is key to helping NUO meet its goals of providing
dependable income and adding value for our investors.
The current market environment - influenced by low interest rates, benign
inflation, and strong municipal supply - has helped to position municipal bonds
as one of the most compelling values in today's marketplace. Continued
volatility in the equity markets and investors' increasing awareness of the need
for asset allocation rebalancing should result in growing demand for municipal
bond funds. We believe that investors who take advantage of current
opportunities in the municipal market should be rewarded with healthy returns
and attractive yields in the months ahead, as the market recognizes the value of
these quality investments.
<PAGE>
Nuveen Ohio Quality Income Municipal Fund,
Inc. Performance Overview As of January 31, 1999
NUO
Portfolio Statistics
- --------------------------------------------------
Inception Date 10/91
- --------------------------------------------------
Share Price $18 3/16
- --------------------------------------------------
Net Asset Value $16.95
- --------------------------------------------------
Market Yield 5.41%
- --------------------------------------------------
Taxable-Equivalent Yield (Federal Only)(1) 7.84%
- --------------------------------------------------
Taxable-Equivalent Yield (Federal
and State)(1) 8.43%
- --------------------------------------------------
Fund Net Assets ($000) $236,233
- --------------------------------------------------
Average Weighted Maturity (Years) 16.02
- --------------------------------------------------
Leverage-Adjusted Duration (Years) 6.91
- --------------------------------------------------
Annualized Total Return
On Share Price On NAV
- --------------------------------------------------
1-Year 2.96% 6.80%
- --------------------------------------------------
3-Year 9.54% 7.40%
- --------------------------------------------------
5-Year 8.07% 6.97%
- --------------------------------------------------
Since Inception 8.86% 8.99%
- --------------------------------------------------
Taxable-Equivalent Total Return(2)
On Share Price On NAV
- --------------------------------------------------
1-Year 5.97% 10.14%
- --------------------------------------------------
3-Year 12.78% 10.79%
- --------------------------------------------------
5-Year 11.46% 10.45%
- --------------------------------------------------
Since Inception 12.19% 12.42%
- --------------------------------------------------
Top Five Sectors (as a % of total investments)
U.S. Guaranteed 24%
- --------------------------------------------------
Tax Obligation (General) 15%
- --------------------------------------------------
Health Care 11%
- --------------------------------------------------
Utilities 9%
- --------------------------------------------------
Education and Civic Organizations 9%
- --------------------------------------------------
Bar chart:
1997-1998 Monthly Tax-Free Dividends
2/98 0.081
3/98 0.081
4/98 0.081
5/98 0.081
6/98 0.081
7/98 0.081
8/98 0.082
9/98 0.082
10/98 0.082
11/98 0.082
12/98 0.082
1/98 0.082
Line chart:
Share Price Performance
2/6/98 18.563
18.75
18.75
18.688
18.688
18.313
18.25
17.875
17.875
17.75
17.438
17.25
17.375
17.938
18.063
18.125
18.25
18.375
18.063
18.188
18.438
18.5
18.375
18.25
18.063
18.313
18.438
18.5
18.75
18.375
18.438
18.313
18.375
19
19.125
19.125
18.81
19
19.06
19.5
19.31
19.63
19.69
19.81
19.75
19.38
18.69
18.25
1/31/99 18.1875
Weekly Closing Price
Past performance is not predictive of future results.
1 Taxable-equivalent yield represents the yield on a taxable investment
necessary to equal the yield of the Nuveen fund on an after-tax basis. The
federal only rate is based on the market yield and a federal income tax rate
of 31%. The rate shown for federal and state highlights the added value of
owning shares that are also exempt from state income taxes. It is based on a
combined federal and state income tax rate of 35.8%.
2 Taxable-equivalent total return is based on the annualized total return and a
combined federal and state income tax rate of 35.8%. It represents the return
on a taxable investment necessary to equal the return of the Nuveen fund on an
after-tax basis.
<PAGE>
Nuveen Texas Quality Income Municipal Fund (NTX)
Portfolio Manager's Comments
Portfolio manager Mike Davern discusses the Texas municipal market, fund
performance, and the outlook for the Nuveen Texas Quality Income Municipal Fund
(NTX). Mike, who has 16 years of investment experience, including seven years
with Nuveen, assumed management responsibility for NTX in July 1998 as part of
Nuveen's efforts to maximize the efficient use of staff resources and portfolio
manager expertise.
What economic factors affected the municipal market in Texas?
Texas ranked third in the nation in terms of total new municipal issuance for
1998, up 18% over 1997. Much of this new supply was issued by the healthcare
sector. Due to the fact that Texas does not have a state personal income tax,
investors in Texas bonds receive only federal tax benefits. Therefore, the
demand for Texas municipal bonds often depends largely on national buyers,
primarily institutional investors. During the past 12 months, when national
issuance was at near-record levels, these investors were able to find bonds that
met their investment needs in other markets. This reduced the demand for Texas
paper and, combined with the increased supply in Texas, impacted performance in
the Texas municipal market. However, individual investors in the state continued
to demonstrate a high level of loyalty to purchasing Texas issues. The credit
quality of the state remained high, with Texas general obligation bonds rated
Aa2 by Moody's, AA by S&P, and AA+ by Fitch.
The Texas economy continued to diversify away from the reliance it placed on the
oil and gas industry in the 1980s by centering on the services industry.
Improving the quality and funding of education continued to be a major focus of
state and local governments. Currently, the state is working to establish a
school funding formula that would equalize funding across school districts.
How did NTX perform over the past year?
For the 12 months ended January 31, 1999, the total return on net asset value
for the Nuveen Texas Quality Income Municipal Fund (NTX) was 5.93%, equivalent
to a taxable total return of 8.54% for investors in the 31% federal income tax
bracket. During this period, declining interest rates caused bond calls to
occur, which contributed to a reduction in the income level of NTX. A dividend
cut was made in May 1998. Proceeds from matured or prepaid bonds had to be
reinvested in issues paying relatively lower current interest rates, which
reduced the income earned by the fund. Since the dividend adjustment, the fund
has continued to provide a steady, competitive market yield for the past nine
months.
As interest rates fell over the past year, active demand for Nuveen
Exchange-Traded Funds resulted in generally solid share price performance. For
NTX, share price performance was strong over the first 11 months (February
through December 1998) of the 12-month period ended January 31, 1999. However,
market conditions during January 1999 erased much of the fund's previous gains
and lowered its share price. At the same time, gains in the fund's net asset
value (NAV) lagged the overall bond market. As a result, the discount of the
fund's market price to NAV widened over the year.
Current Total Return
Market Yield Discount* on Share Price
- --------------------------------------------------------------------------------
Taxable 1 Year Ending Taxable
1/31/99 Equivalent** 1/31/98 1/31/99 1/31/99 Equivalent**
- --------------------------------------------------------------------------------
NTX 5.74% 8.32% -0.56% -2.14% 4.28% 6.91%
- --------------------------------------------------------------------------------
*Discount represents the difference between the fund's share price and its NAV.
**Taxable-equivalent yield represents the yield on a taxable investment
necessary to equal the yield of the Nuveen fund on an after-tax basis. It is
based on the market yield and a federal income tax rate of 31%.
Taxable-equivalent total return is based on the annualized total return and
the federal income tax rate of 31%. It represents the return on a taxable
investment necessary to equal the return of the Nuveen fund on an after-tax
basis.
For additional information, see the Performance Overview for NTX in this
report.
What key strategies were used to manage the fund during the past year?
NTX offers solid risk-adjusted performance and a very competitive market yield.
The focus of our management strategies continued to be on supporting the highest
level of tax-exempt dividend consistent with capital preservation while trying
to enhance the fund's after-tax total return. Over the past 12 months, the fund
saw little portfolio turnover in terms of proactively adding new bonds due to
the fact that the bonds currently held in this portfolio offer higher income
streams than those that can be purchased in the market today. The bond calls
that occurred were as a result of the issuers taking advantage of the lower
rates to refinance their debt. All of the bonds that had to be added to the
portfolio were assessed in terms of coupon, call protection, maturity, and
credit quality to determine whether their structure would enhance the fund's
position. One of our more significant purchases involved bonds issued by the
Gulf Coast Waste Disposal Authority for Valero Energy Corporation Project, which
offered an attractive yield of 5.60%. These BBB rated bonds showcase the types
of purchases we made to support the fund's dividend.
What is Nuveen's outlook for the future?
Looking ahead for NTX, our focus will remain on supporting the fund's income
stream and on purchasing bonds that enhance the fund's structure at attractive
prices. We will also look at positioning the fund's duration so that the fund is
better protected against interest rate volatility. Making the portfolio
decisions that help the fund meet its goals is an area where Nuveen's expertise
- - as an experienced investment manager knowledgeable about the unique aspects of
the Texas municipal market - can result in added value for our investors.
The current market environment - influenced by low interest rates, benign
inflation, and strong municipal supply - has helped to position municipal bonds
as one of the most compelling values in today's marketplace. Continued
volatility in the equity markets and investors' increasing awareness of the need
for asset allocation rebalancing should result in growing demand for municipal
bond funds. We believe that investors who take advantage of current
opportunities in the municipal market should be rewarded with healthy returns
and attractive yields in the months ahead, as the market recognizes the value of
these quality investments.
<PAGE>
Nuveen Texas Quality Income Municipal Fund
Performance Overview
As of January 31, 1999
NTX
Portfolio Statistics
- --------------------------------------------------
Inception Date 10/91
- --------------------------------------------------
Share Price $15 11/16
- --------------------------------------------------
Net Asset Value $16.03
- --------------------------------------------------
Market Yield 5.74%
- --------------------------------------------------
Taxable-Equivalent Yield1 8.32%
- --------------------------------------------------
Fund Net Assets ($000) $220,040
- --------------------------------------------------
Average Weighted Maturity (Years) 19.06
- --------------------------------------------------
Leverage-Adjusted Duration (Years) 8.46
- --------------------------------------------------
Annualized Total Return
On Share Price On NAV
- --------------------------------------------------
1-Year 4.28% 5.93%
- --------------------------------------------------
3-Year 7.65% 7.11%
- --------------------------------------------------
5-Year 6.67% 6.77%
- --------------------------------------------------
Since Inception 7.21% 8.45%
- --------------------------------------------------
Taxable-Equivalent Total Return(2)
On Share Price On NAV
- --------------------------------------------------
1-Year 6.91% 8.54%
- --------------------------------------------------
3-Year 10.44% 9.84%
- --------------------------------------------------
5-Year 9.60% 9.64%
- --------------------------------------------------
Since Inception 10.08% 11.30%
- --------------------------------------------------
Top 5 Sectors (as a % of total investments)
U.S. Guaranteed 20%
- --------------------------------------------------
Health Care 16%
- --------------------------------------------------
Tax Obligation (General) 11%
- --------------------------------------------------
Transportation 11%
- --------------------------------------------------
Housing (Single Family) 8%
- --------------------------------------------------
Bar chart:
1997-1998 Monthly Tax-Free Dividends(3)
2/98 0.078
3/98 0.078
4/98 0.078
5/98 0.075
6/98 0.075
7/98 0.075
8/98 0.075
9/98 0.075
10/98 0.075
11/98 0.075
12/98 0.075
1/99 0.075
Line chart:
Share Price Performance
2/6/98 16.25
16.688
16.563
16.5
16.125
16.375
16.125
15.5
15.938
15.688
15.438
15.75
16.125
15.875
15.875
15.688
15.75
15.625
15.563
15.625
15.938
16.125
15.75
15.688
15.688
15.75
15.688
15.75
15.875
15.625
15.5
15.625
15.625
16
15.875
15.813
15.88
15.94
15.94
16.25
16.13
16.44
16.44
16.25
16.06
15.75
15.63
15.44
1/31/99 15.6875
Weekly Closing Price
Past performance is not predictive of future results.
1 Taxable-equivalent yield represents the yield on a taxable investment
necessary to equal the yield of the Nuveen fund on an after-tax basis. It
is based on the market yield and a federal income tax rate of 31%.
2 Taxable-equivalent total return is based on the annualized total return and
the federal income tax rate of 31%. It represents the return on a taxable
investment necessary to equal the return of the Nuveen fund on an after-tax
basis.
3 The Fund also paid shareholders taxable distributions in December of $0.0745
per share.
<PAGE>
<TABLE>
Shareholder Meeting Report
The annual shareholder meeting was held in Chicago, Illinois on October 14,
1998.
<CAPTION>
NAZ NUM
- ------------------------------------------------------------------------------------------------------------------------------------
Approval of the Directors was reached as follows:
Preferred Preferred
Common Shares Common Shares
Shares Series-TH Shares Series-TH
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Robert P. Bremner
For 4,094,439 1,168 10,178,149 3,000
Withhold 60,255 1 146,662 26
- ------------------------------------------------------------------------------------------------------------------------------------
Total 4,154,694 1,169 10,324,811 3,026
- ------------------------------------------------------------------------------------------------------------------------------------
Lawrence H. Brown
For 4,094,439 1,168 10,179,620 3,000
Withhold 60,225 1 145,191 26
- ------------------------------------------------------------------------------------------------------------------------------------
Total 4,154,664 1,169 10,324,811 3,026
- ------------------------------------------------------------------------------------------------------------------------------------
Anthony T. Dean
For 4,094,439 1,168 10,179,849 3,000
Withhold 60,255 1 144,962 26
- ------------------------------------------------------------------------------------------------------------------------------------
Total 4,154,694 1,169 10,324,811 3,026
- ------------------------------------------------------------------------------------------------------------------------------------
Anne E. Impellizzeri
For 4,093,239 1,168 10,172,610 3,000
Withhold 61,455 1 152,201 26
- ------------------------------------------------------------------------------------------------------------------------------------
Total 4,154,694 1,169 10,324,811 3,026
- ------------------------------------------------------------------------------------------------------------------------------------
Peter R. Sawers
For 4,094,439 1,168 10,167,682 3,000
Withhold 60,255 1 157,129 26
- ------------------------------------------------------------------------------------------------------------------------------------
Total 4,154,694 1,169 10,324,811 3,026
- ------------------------------------------------------------------------------------------------------------------------------------
William J. Schneider
For -- 1,167 -- 3,000
Withhold -- 2 -- 26
- ------------------------------------------------------------------------------------------------------------------------------------
Total -- 1,169 -- 3,026
- ------------------------------------------------------------------------------------------------------------------------------------
Timothy R. Schwertfeger
For -- 1,167 -- 3,000
Withhold -- 2 -- 26
- ------------------------------------------------------------------------------------------------------------------------------------
Total -- 1,169 -- 3,026
- ------------------------------------------------------------------------------------------------------------------------------------
Judith M. Stockdale
For 4,094,439 1,168 10,175,977 3,000
Withhold 60,255 1 148,834 26
- ------------------------------------------------------------------------------------------------------------------------------------
Total 4,154,694 1,169 10,324,811 3,026
- ------------------------------------------------------------------------------------------------------------------------------------
Ratification of auditors was reached as follows:
For 4,104,269 1,166 10,172,895 3,001
Against 19,943 3 25,838 2
Abstain 30,482 -- 126,078 23
- ------------------------------------------------------------------------------------------------------------------------------------
Total 4,154,694 1,169 10,324,811 3,026
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Shareholder Meeting Report (continued)
NMP
- ------------------------------------------------------------------------------------------------------------------------------------
Approval of the Directors was reached as follows:
Preferred Preferred
Common Shares Shares
Shares Series-M Series-TH
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Robert P. Bremner
For 7,008,968 812 1,222
Withhold 116,247 5 22
- ------------------------------------------------------------------------------------------------------------------------------------
Total 7,125,215 817 1,244
- ------------------------------------------------------------------------------------------------------------------------------------
Lawrence H. Brown
For 7,009,314 812 1,222
Withhold 115,901 5 22
- ------------------------------------------------------------------------------------------------------------------------------------
Total 7,125,215 817 1,244
- ------------------------------------------------------------------------------------------------------------------------------------
Anthony T. Dean
For 7,009,314 812 1,222
Withhold 115,901 5 22
- ------------------------------------------------------------------------------------------------------------------------------------
Total 7,125,215 817 1,244
- ------------------------------------------------------------------------------------------------------------------------------------
Anne E. Impellizzeri
For 7,005,484 812 1,222
Withhold 119,731 5 22
- ------------------------------------------------------------------------------------------------------------------------------------
Total 7,125,215 817 1,244
- ------------------------------------------------------------------------------------------------------------------------------------
Peter R. Sawers
For 7,006,191 812 1,222
Withhold 119,024 5 22
- ------------------------------------------------------------------------------------------------------------------------------------
Total 7,125,215 817 1,244
- ------------------------------------------------------------------------------------------------------------------------------------
William J. Schneider
For -- 812 1,222
Withhold -- 5 22
- ------------------------------------------------------------------------------------------------------------------------------------
Total -- 817 1,244
- ------------------------------------------------------------------------------------------------------------------------------------
Timothy R. Schwertfeger
For -- 812 1,222
Withhold -- 5 22
- ------------------------------------------------------------------------------------------------------------------------------------
Total -- 817 1,244
- ------------------------------------------------------------------------------------------------------------------------------------
Judith M. Stockdale
For 7,007,539 812 1,222
Withhold 117,676 5 22
- ------------------------------------------------------------------------------------------------------------------------------------
Total 7,125,215 817 1,244
- ------------------------------------------------------------------------------------------------------------------------------------
Ratification of auditors was reached as follows:
For 6,997,755 816 1,233
Against 26,358 1 3
Abstain 101,102 -- 8
- ------------------------------------------------------------------------------------------------------------------------------------
Total 7,125,215 817 1,244
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
NUO
- ------------------------------------------------------------------------------------------------------------------------------------
Approval of the Directors was reached as follows:
Preferred Preferred Preferred
Common Shares Shares Shares
Shares Series-M Series-TH Series-TH2
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Robert P. Bremner
For 8,337,701 610 1,361 946
Withhold 90,487 -- 3 2
- ------------------------------------------------------------------------------------------------------------------------------------
Total 8,428,188 610 1,364 948
- ------------------------------------------------------------------------------------------------------------------------------------
Lawrence H. Brown
For 8,337,999 610 1,361 946
Withhold 90,189 -- 3 2
- ------------------------------------------------------------------------------------------------------------------------------------
Total 8,428,188 610 1,364 948
- ------------------------------------------------------------------------------------------------------------------------------------
Anthony T. Dean
For 8,339,701 610 1,361 946
Withhold 88,487 -- 3 2
- ------------------------------------------------------------------------------------------------------------------------------------
Total 8,428,188 610 1,364 948
- ------------------------------------------------------------------------------------------------------------------------------------
Anne E. Impellizzeri
For 8,334,233 610 1,361 946
Withhold 93,955 -- 3 2
- ------------------------------------------------------------------------------------------------------------------------------------
Total 8,428,188 610 1,364 948
- ------------------------------------------------------------------------------------------------------------------------------------
Peter R. Sawers
For 8,336,315 610 1,361 946
Withhold 91,873 -- 3 2
- ------------------------------------------------------------------------------------------------------------------------------------
Total 8,428,188 610 1,364 948
- ------------------------------------------------------------------------------------------------------------------------------------
William J. Schneider
For -- 610 1,361 946
Withhold -- -- 3 2
- ------------------------------------------------------------------------------------------------------------------------------------
Total -- 610 1,364 948
- ------------------------------------------------------------------------------------------------------------------------------------
Timothy R. Schwertfeger
For -- 610 1,361 946
Withhold -- -- 3 2
- ------------------------------------------------------------------------------------------------------------------------------------
Total -- 610 1,364 948
- ------------------------------------------------------------------------------------------------------------------------------------
Judith M. Stockdale
For 8,332,119 610 1,361 946
Withhold 96,069 -- 3 2
- ------------------------------------------------------------------------------------------------------------------------------------
Total 8,428,188 610 1,364 948
- ------------------------------------------------------------------------------------------------------------------------------------
Ratification of auditors was reached as follows:
For 8,260,328 609 1,346 934
Against 42,706 1 -- --
Abstain 125,154 -- 18 14
- ------------------------------------------------------------------------------------------------------------------------------------
Total 8,428,188 610 1,364 948
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
<TABLE>
Shareholder Meeting Report (continued)
<CAPTION>
NTX
- ------------------------------------------------------------------------------------------------------------------------------------
Approval of the Trustees was reached as follows:
Preferred Preferred
Common Shares Shares
Shares Series-M Series-TH
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Robert P. Bremner
For 8,628,623 655 1,915
Withhold 79,494 -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Total 8,708,117 655 1,915
- ------------------------------------------------------------------------------------------------------------------------------------
Lawrence H. Brown
For 8,628,017 655 1,915
Withhold 80,100 -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Total 8,708,117 655 1,915
- ------------------------------------------------------------------------------------------------------------------------------------
Anthony T. Dean
For 8,627,123 655 1,915
Withhold 80,994 -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Total 8,708,117 655 1,915
- ------------------------------------------------------------------------------------------------------------------------------------
Anne E. Impellizzeri
For 8,625,461 655 1,915
Withhold 82,656 -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Total 8,708,117 655 1,915
- ------------------------------------------------------------------------------------------------------------------------------------
Peter R. Sawers
For 8,626,623 655 1,915
Withhold 81,494 -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Total 8,708,117 655 1,915
- ------------------------------------------------------------------------------------------------------------------------------------
William J. Schneider
For -- 655 1,91
Withhold -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Total -- 655 1,915
- ------------------------------------------------------------------------------------------------------------------------------------
Timothy R. Schwertfeger
For -- 655 1,91
Withhold -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Total -- 655 1,915
- ------------------------------------------------------------------------------------------------------------------------------------
Judith M. Stockdale
For 8,625,664 655 1,915
Withhold 82,453 -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Total 8,708,117 655 1,915
- ------------------------------------------------------------------------------------------------------------------------------------
Ratification of auditors was reached as follows:
For 8,566,459 655 1,914
Against 30,883 -- --
Abstain 110,774 -- 1
- ------------------------------------------------------------------------------------------------------------------------------------
Total 8,708,117 655 1,915
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
<TABLE>
Portfolio of Investments
Nuveen Arizona Premium Income Municipal Fund, Inc. (NAZ)
January 31, 1999
(Unaudited)
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Basic Materials - 5.0%
$ 5,000,000 The Industrial Development Authority of the County of Gila, Arizona, 1/08 at 102 Baa2 $4,947,950
Environmental Revenue Refunding Bonds (ASARCO Incorporated Project),
Series 1998, 5.550%, 1/01/27
- ------------------------------------------------------------------------------------------------------------------------------------
Education and Civic Organizations - 3.1%
1,750,000 Student Loan Acquisition Authority of Arizona, Student Loan Revenue 5/04 at 102 Aa 1,888,373
Bonds, Series 1994B, Subordinated Fixed Rate Bonds, 6.600%, 5/01/10
(Alternative Minimum Tax)
100,000 University of Arizona Telecommunications System, Certificates of 7/02 at 102 A+ 109,901
Participation, Series 1991, 6.500%, 7/15/12
1,000,000 Arizona Board of Regents, University of Arizona, System Revenue 6/02 at 102 AA 1,091,910
Refunding Bonds, Series 1992, 6.250%, 6/01/11
- ------------------------------------------------------------------------------------------------------------------------------------
Health Care - 12.4%
1,500,000 The Industrial Development Authority of the County of Maricopa (Arizona), 7/02 at 102 AAA 1,616,595
Insured Health Facility Revenue Bonds (Catholic Healthcare West),
1992 Series A, 5.750%, 7/01/11
3,500,000 The Industrial Development Authority of the County of Maricopa (Arizona), No Opt. Call AAA 4,511,990
Samaritan Health Services, Hospital System Revenue Refunding Bonds,
Series 1990A, 7.000%, 12/01/16
600,000 The Industrial Development Authority of the County of Maricopa (Arizona), 9/05 at 101 AAA 628,368
Baptist Hospital System Revenue Refunding Bonds, Series 1995,
5.500%, 9/01/16
2,000,000 Hospital District No. One, Mohave County, Arizona, Refunding General 6/02 at 101 AAA 2,178,440
Obligation Bonds (Kingman Regional Medical Center Project),
Series 1992, 6.500%, 6/01/15
2,000,000 University Medical Center Corporation (Tucson, Arizona), Hospital 7/02 at 102 AAA 2,183,840
Revenue Refunding Bonds, Series 1992, 6.250%, 7/01/16
1,055,000 The Industrial Development Authority of the City of Winslow, Arizona, 6/08 at 101 N/R 1,026,410
Hospital Revenue Bonds (Winslow Memorial Hospital Project),
Series 1998, 5.500%, 6/01/22
- ------------------------------------------------------------------------------------------------------------------------------------
Housing/Multifamily - 6.1%
1,670,000 The Industrial Development Authority of the City of Phoenix, Arizona, 12/05 at 103 AAA 1,673,741
Multifamily Housing Revenue Bonds, Series 1998A (Heather Ridge
Apartments Project), 5.200%, 12/15/21 (Alternative Minimum Tax)
4,000,000 The Industrial Development Authority of the City of Tucson, Arizona, 12/06 at 102 AAA 4,268,360
Tax-Exempt Multifamily Housing Revenue Refunding Bonds, Series 1996,
5.900%, 12/20/31
- ------------------------------------------------------------------------------------------------------------------------------------
Housing/Single Family - 3.3%
450,000 The Industrial Development Authority of the City of Phoenix, Arizona, 6/05 at 102 AAA 473,184
Statewide Single Family Mortgage Revenue Bonds, Series 1995,
6.150%, 6/01/08 (Alternative Minimum Tax)
350,000 The Industrial Development Authority of the County of Pima (Arizona), 8/05 at 102 A 376,033
Single Family Mortgage Revenue Refunding Bonds, Series 1995A,
6.500%, 2/01/17
2,205,000 The Industrial Development Authority of the County of Pima (Arizona), 5/07 at 102 AAA 2,372,492
Single Family Mortgage Revenue Bonds, Series 1997A,
6.250%, 11/01/30 (Alternative Minimum Tax)
- ------------------------------------------------------------------------------------------------------------------------------------
Long Term Care - 1.1%
1,000,000 The Industrial Development Authority of the County of Mohave, 5/06 at 103 AAA 1,089,500
Health Care Revenue Refunding Bonds, Series 1996 (GNMA
Collateralized - Chris Ridge and Silver Ridge Village Projects),
6.375%, 11/01/31
- ------------------------------------------------------------------------------------------------------------------------------------
Tax Obligation/General - 9.8%
1,400,000 Maricopa Rural Road Improvement, District of Pinal County, Arizona, 7/99 at 101 N/R 1,427,300
Refunding Bonds, Series 1994, 7.000%, 7/01/07
1,500,000 Paradise Valley Unified School District No. 69 of Maricopa County, 7/03 at 102 AAA 1,666,875
Arizona, School Improvement Bonds, Project of 1990, Series D,
5.875%, 7/01/12
<PAGE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Tax Obligation/General (continued)
$ 1,400,000 Chandler Unified School District No. 80 of Maricopa County, Arizona, 7/03 at 101 AAA $1,529,682
General Obligation Refunding Bonds, Series 1993, 5.950%, 7/01/10
2,500,000 City of Phoenix, Arizona, General Obligation Refunding Bonds, 7/02 at 102 AA+ 2,746,075
Series 1992, 6.375%, 7/01/13
2,000,000 Tempe Union High School District No. 213 of Maricopa County, Arizona, 7/04 at 101 AAA 2,212,920
School Improvement and Refunding Bonds, Series 1994, 6.000%, 7/01/12
- ------------------------------------------------------------------------------------------------------------------------------------
Tax Obligation/Limited - 10.8%
City of Bullhead, Bullhead Parkway Improvement District Improvement Bonds:
910,000 6.100%, 1/01/08 1/03 at 103 Baa 994,739
970,000 6.100%, 1/01/09 1/03 at 103 Baa 1,060,326
1,600,000 City of Lake Havasu, City Municipal Property Corporation, Municipal 6/02 at 101 AAA 1,730,912
Facilities Revenue Bonds, Series 1993, 6.000%, 6/01/08
2,000,000 Hospital District No. One, Maricopa County, Arizona, General 6/08 at 102 AAA 2,002,440
Obligation Bonds, Series 1998, 5.000%, 6/01/21
2,150,000 Phoenix Civic Plaza Building Corporation, Senior Lien Excise Tax 7/05 at 101 AA+ 2,370,117
Revenue Bonds, Series 1994, 6.000%, 7/01/14
1,510,000 Metropolitan Domestic Water Improvement District of Pima County, 1/03 at 101 AAA 1,644,360
Arizona, Special Assessment and Water Revenue Bonds, Series 1992,
6.200%, 1/01/12
725,000 City of Tucson, Arizona, Certificates of Participation, Series 1994, 7/04 at 100 AA 807,411
6.375%, 7/01/09
- ------------------------------------------------------------------------------------------------------------------------------------
Transportation - 5.5%
5,000,000 Tucson Airport Authority, Inc. (Arizona), Airport Revenue Bonds, 6/03 at 102 AAA 5,433,000
Refunding Series 1993, 5.700%, 6/01/13
- ------------------------------------------------------------------------------------------------------------------------------------
U.S. Guaranteed - 21.4%
3,195,000 Kyrene Elementary School District No. 28 of Maricopa County, Arizona, 7/02 at 100 AAA 3,455,233
School Improvement Bonds, Project of 1990, Series E, 6.000%, 7/01/12
(Pre-refunded to 7/01/02)
The Industrial Development Authority of the County of Mohave, Hospital
System Revenue Refunding Bonds (Medical Environments, Inc. and
Phoenix Baptist Hospital and Medical Center Inc.), Series 1993:
5,000,000 6.750%, 7/01/08 (Pre-refunded to 7/01/03) 7/03 at 102 Aaa 5,722,700
1,000,000 7.000%, 7/01/16 (Pre-refunded to 7/01/03) 7/03 at 102 Aaa 1,154,670
3,700,000 City of Phoenix (Arizona), Civic Improvement Corporation, Wastewater 7/03 at 102 AAA 4,149,143
System Lease Revenue Bonds, Series 1993, 6.125%, 7/01/23
(Pre-refunded to 7/01/03)
3,000,000 City of Tucson, Arizona, General Obligation Bonds, Series 1984-G, 7/04 at 101 AAA 3,404,340
6.250%, 7/01/18 (Pre-refunded to 7/01/04)
1,290,000 City of Tucson, Arizona, General Obligation Bonds, Series 1994-B, 7/06 at 101 AA*** 1,451,714
5.750%, 7/01/18 (Pre-refunded to 7/01/06)
1,500,000 City of Tucson, Arizona, Water System Revenue Bonds, Series 1994-A, 7/06 at 101 AAA 1,717,215
6.000%, 7/01/21 (Pre-refunded to 7/01/06)
- ------------------------------------------------------------------------------------------------------------------------------------
Utilities - 12.0%
2,000,000 The Industrial Development Authority of the County of Mohave (Arizona), 11/03 at 101 AA- 2,179,240
Industrial Development Revenue Bonds, 1994 Series (Citizen Utilities
Company Projects), 6.600%, 5/01/29 (Alternative Minimum Tax)
1,000,000 Navajo County, Arizona, Pollution Control Corporation, Pollution Control 8/03 at 102 A- 1,025,310
Revenue Refunding Bonds (Arizona Public Service Company),
1993 Series A, 5.875%, 8/15/28
1,710,000 The Industrial Development Authority of the County of Pima (Arizona), 1/02 at 103 AAA 1,911,883
Industrial Development Lease Obligation Refunding Revenue Bonds,
1988 Series A (Irvington Project), 7.250%, 7/15/10
2,030,000 Salt River Project Agricultural Improvement and Power District, Arizona, 1/02 at 100 AA 2,119,868
Salt River Project Electric System Revenue Bonds, 1992 Series D,
5.750%, 1/01/19
2,400,000 Salt River Project Agricultural Improvement and Power District, Arizona, 1/04 at 102 AA 2,428,608
Salt River Project Electric System Revenue Refunding Bonds,
1993 Series C, 5.000%, 1/01/16
2,000,000 The Industrial Development Authority of the County of Yavapai (Arizona), 6/07 at 101 AA- 2,076,500
Industrial Development Revenue Bonds, 1998 Series (Citizens Utilities
Company Project), 5.450%, 6/01/33 (Alternative Minimum Tax)
<PAGE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Water and Sewer - 9.4%
$ 2,150,000 Arizona Municipal Financing Program of 1992, Refunding Certificates 8/02 at 101 AAA $2,304,779
of Participation, Series 1, 6.000%, 8/01/17
500,000 Wastewater Management Authority of Arizona, Wastewater Treatment 7/05 at 102 AAA 543,630
Financial Assistance Revenue Bonds, Series 1995, 5.750%, 7/01/15
500,000 The Industrial Development Authority of the County of Maricopa, 12/07 at 102 AAA 513,385
Water System Improvement Revenue Bonds (Chaparral City Water
Company Project), Series 1997A, 5.400%, 12/01/22
(Alternative Minimum Tax)
2,000,000 City of Phoenix, Arizona, Civic Improvement Corporation Wastewater 7/04 at 102 Aa3 2,099,099
System Lease Revenue Refunding Bonds, Series 1993,
5.000%, 7/01/10
3,500,000 City of Tucson, Arizona, Water System Revenue Refunding Bonds, 7/02 at 102 A+ 3,739,364
Series 1992A, 5.750%, 7/01/18
- ------------------------------------------------------------------------------------------------------------------------------------
$ 90,320,000 Total Investments - (cost $89,395,536) - 99.9% 98,059,925
=============
Other Assets Less Liabilities - 0.1% 67,046
--------------------------------------------------------------------------------------------------------------------
Net Assets - 100% $98,126,971
====================================================================================================================
* Optional Call Provisions: Dates (month and year) and prices of the earliest
optional call or redemption. There may be other call provisions at varying
prices at later dates.
** Ratings: Using the higher of Standard & Poor's or Moody's rating.
*** Securities are backed by an escrow or trust containing sufficient U.S.
government or U.S. government agency securities which ensures the timely
payment of principal and interest. Securities are normally considered to be
equivalent to AAA rated securities.
N/R Investment is not rated.
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
Portfolio of Investments
Nuveen Michigan Quality Income Municipal Fund, Inc. (NUM)
January 31, 1999
(Unaudited)
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Capital Goods - 0.4%
$ 1,000,000 Michigan Strategic Fund, Limited Obligation Revenue Bonds 12/03 at 102 A1 $1,047,520
(WMX Technologies, Inc. Project), Series 1993, 6.000%, 12/01/13
(Alternative Minimum Tax)
- ------------------------------------------------------------------------------------------------------------------------------------
Education and Civic Organizations - 4.6%
5,020,000 Board of Trustees of Ferris State University (Michigan), General 4/08 at 100 AAA 5,002,028
Revenue Bonds, Series 1998, 5.000%, 10/01/23
Michigan Higher Education Student Loan Authority, Student Loan
and Refunding Revenue Bonds, Series XV-A:
1,000,000 6.800%, 10/01/07 (Alternative Minimum Tax) 10/02 at 102 A 1,065,000
1,250,000 6.800%, 10/01/08 (Alternative Minimum Tax) 10/02 at 102 A 1,329,100
990,000 6.800%, 10/01/09 (Alternative Minimum Tax) 10/02 at 102 A 1,049,242
2,000,000 Board of Trustees of Oakland University, Michigan, General Revenue 5/05 at 102 AAA 2,168,660
Bonds, Series 1995, 5.750%, 5/15/15
1,450,000 Board of Trustees of Western Michigan University, General Revenue 7/03 at 102 AAA 1,443,185
Bonds, Series 1993A, 5.000%, 7/15/21
- ------------------------------------------------------------------------------------------------------------------------------------
Health Care - 7.3%
2,235,000 City of Hancock Hospital Finance Authority, FHA-Insured Mortgage 8/08 at 100 AAA 2,304,374
Hospital Revenue Bonds (Portage Health System, Inc.), Series 1998,
5.450%, 8/01/47
1,000,000 City of Kalamazoo Hospital Finance Authority, Hospital Revenue 5/08 at 101 Aaa 1,022,600
Refunding and Improvement Bonds (Bronson Methodist Hospital),
Series 1998, 5.250%, 5/15/18
410,000 Michigan State Hospital Finance Authority, Hospital Revenue and 2/99 at 102 A- 419,697
Refunding Bonds (The Detroit Medical Center Obligated Group),
Series 1988B, 8.125%, 8/15/08
8,800,000 Michigan State Hospital Finance Authority, Hospital Revenue Bonds 5/01 at 100 AA- 9,125,776
(Mercy Mount Clemens Corporation), Series 1992, 6.000%, 5/15/17
4,500,000 Michigan State Hospital Finance Authority, Hospital Revenue Bonds 8/08 at 101 A- 4,163,850
(The Detroit Medical Center Obligated Group), Series 1998A,
5.250%, 8/15/28
1,000,000 Michigan State Hospital Finance Authority, Hospital Revenue Bonds ( 5/09 at 101 AA+ 984,700
Charity Obligated Group), Series 1999A, 5.125%, 11/01/29 (WI)
2,195,000 Regents of the University of Michigan, Medical Service Plan Revenue No Opt. Call Aa2 1,312,698
Bonds, Series 1991, 0.000%, 12/01/10
- ------------------------------------------------------------------------------------------------------------------------------------
Housing/Multifamily - 4.8%
5,250,000 Michigan State Housing Development Authority, Limited Obligation 10/02 at 103 AAA 5,683,440
Revenue Bonds (Parkway Meadows Project), Series 1991,
6.850%, 10/15/18
760,000 Michigan State Housing Development Authority, Rental Housing 1/02 at 102 AA- 816,597
Revenue Bonds, 1991 Series A, 7.150%, 4/01/10
(Alternative Minimum Tax)
5,625,000 Michigan State Housing Development Authority, Rental Housing 1/02 at 102 AA- 6,033,150
Revenue Bonds, 1991 Series B, 7.100%, 4/01/21
- ------------------------------------------------------------------------------------------------------------------------------------
Housing/Single Family - 1.6%
2,790,000 Michigan State Housing Development Authority, Single-Family 12/01 at 102 AA+ 2,947,830
Mortgage Revenue Bonds, 1991 Series B, 6.950%, 12/01/20
1,345,000 Michigan State Housing Development Authority, Single-Family Mortgage 6/02 at 102 AA+ 1,394,281
Revenue Bonds, 1992 Series A, 6.875%, 6/01/23
- ------------------------------------------------------------------------------------------------------------------------------------
Long Term Care - 3.1%
1,250,000 Michigan State Hospital Finance Authority, Revenue Bonds 1/07 at 102 N/R 1,338,638
(Presbyterian Villages of Michigan Obligated Group), Series 1997,
6.375%, 1/01/25
<PAGE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Long Term Care (continued)
$ 1,300,000 Michigan Strategic Fund, Limited Obligation Revenue Bonds 7/08 at 101 A $1,308,190
(Porter Hills Presbyterian Village Inc., Project), Series 1998,
5.375%, 7/01/28
5,280,000 The Economic Development Corporation of the City of Warren, Nursing 3/02 at 101 Aaa 5,580,643
Home Revenue Refunding Bonds (GNMA Mortgage-Backed Security -
Autumn Woods Project), Series 1992, 6.900%, 12/20/22
- ------------------------------------------------------------------------------------------------------------------------------------
Tax Obligation/General - 19.8%
3,935,000 Anchor Bay School District, Counties of Macomb and St. Clair, State 5/03 at 101 1/2 AAA 4,123,998
of Michigan, 1993 School Building and Site Bonds (General Obligation
Unlimited Tax), 5.550%, 5/01/19
1,000,000 Belding Area Schools, Counties of Ionia, Kent and Montcalm, State 5/08 at 100 AAA 996,230
of Michigan, 1998 Refunding Bonds (General Obligation - Unlimited
Tax), 5.000%, 5/01/26
1,200,000 Berkley School District, County of Oakland, State of Michigan, 1/05 at 101 AAA 1,310,664
1995 School Building and Site Bonds (General Obligation - Unlimited
Tax), 6.000%, 1/01/19
6,680,000 Chippewa Valley Schools, County of Macomb, State of Michigan, 5/03 at 102 AAA 6,648,404
1993 Refunding Bonds (General Obligation - Unlimited Tax),
5.000%, 5/01/21
1,000,000 School District of the City of Detroit, Wayne County, Michigan, 5/09 at 101 AAA 963,950
School Building and Site Improvement Bonds (Unlimited Tax -
General Obligation), Series 1998A, 4.750%, 5/01/28
3,000,000 Grand Rapids Community College, Community College Bonds, 5/03 at 102 AA- 2,997,780
Series 1993 (General Obligation - Limited Tax), 5.000%, 5/01/21
1,355,000 County of Grand Traverse, State of Michigan, Grand Traverse 11/10 at 100 AAA 1,378,157
County - Township of Blair, 1998 Water System Improvements Project
(General Obligation - Limited Tax), 5.200%, 11/01/23
3,725,000 Lake Orion Community School District, County of Oakland, State 5/05 at 101 AAA 3,886,367
of Michigan, 1995 Refunding Bonds (General Obligation - Unlimited
Tax), 5.500%, 5/01/20
1,000,000 School District of the City of Lincoln Park, County of Wayne, 5/07 at 100 AAA 1,009,690
State of Michigan, 1997 Refunding Bonds (Unlimited Tax),
5.000%, 5/01/17
1,000,000 Mancelona Public School District, General Obligation Bonds, 5/06 at 100 AAA 1,023,140
Series 1997 (Antrim and Kalkaska Counties), 5.200%, 5/01/17
6,650,000 Mattawan Consolidated School, Counties of Van Buren and 5/02 at 102 AA+ 7,238,592
Kalamazoo, State of Michigan, 1992 Refunding Bonds (General
Obligation - Unlimited Tax), 6.300%, 5/01/17
2,500,000 Montrose Township School District, Michigan, School Building No Opt. Call AAA 2,903,850
and Site Bonds, Series 1997, 6.000%, 5/01/22
1,045,000 Nice Community School District, Counties of Marquette and 5/04 at 101 AAA 1,063,517
Baraga, State of Michigan, 1995 School Building and Site Bonds
(General Obligation - Unlimited Tax), 5.250%, 5/01/20
1,225,000 North Branch Area Schools, County of Lapeer, State of Michigan, 5/03 at 101 1/2 AAA 1,256,262
1993 Refunding Bonds (General Obligation - Unlimited Tax),
5.375%, 5/01/21
1,470,000 Parchment School District, County of Kalamazoo, State of Michigan, No Opt. Call AAA 1,507,955
1998 School Building and Site Bonds (General Obligation - Unlimited
Tax), 5.000%, 5/01/25
2,090,000 Public School of Petoskey, Counties of Emmet and Charlevoix, 5/08 at 100 Aa1 2,105,947
State of Michigan, 1998 School Building and Site Bonds (General
Obligation - Unlimited Tax), 5.100%, 11/01/19
685,000 Reeths-Puffer Schools, County of Muskegon, State of Michigan, 5/05 at 101 AAA 737,334
1995 School Building and Site and Refunding Bonds, 5.750%, 5/01/15
600,000 Rockford Public Schools, Kent County, 1997 School Building 5/07 at 100 AAA 610,608
and Site Bonds, General Obligation - Unlimited Tax, 5.250%, 5/01/27
Western Townships Utilities Authority, Sewage Disposal System
Refunding Bonds, Series 1991:
1,500,000 6.750%, 1/01/15 1/02 at 100 AAA 1,621,020
5,040,000 6.500%, 1/01/19 1/02 at 100 AAA 5,404,896
1,725,000 Williamston Community School District (General No Opt. Call AAA 1,888,996
Obligation - Unlimited Tax), Series 1996 (Q-SBLF),
5.500%, 5/01/25
1,500,000 School District of Ypsilanti, County of Washenaw, State of 5/07 at 100 AAA 1,546,245
Michigan, 1996 School Building and Site Refunding Bonds (General
Obligation - Unlimited Tax), 5.375%, 5/01/26
<PAGE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Tax Obligation/Limited - 3.5%
$ 2,000,000 Michigan Municipal Bond Authority, Local Government Loan Program 5/02 at 102 A $2,181,460
Revenue Bonds, Series 1992D, 6.650%, 5/01/12
3,800,000 State Building Authority, State of Michigan, 1991 Revenue 10/01 at 102 AA 4,077,248
Refunding Bonds, Series I, 6.250%, 10/01/20
1,825,000 State Building Authority, State of Michigan, 1991 Revenue Bonds, 10/01 at 102 AA 1,984,779
Series II, 6.800%, 10/01/21
1,000,000 State Building Authority, State of Michigan, 1998 Revenue Bonds, 10/09 at 100 AA 964,240
Series I (Facilities Program), 4.750%, 10/15/21
- ------------------------------------------------------------------------------------------------------------------------------------
Transportation - 1.0%
2,505,000 Charter County of Wayne, Michigan, Airport Revenue Bonds (Detroit 12/01 at 102 AAA 2,735,936
Metropolitan Wayne County Airport), Subordinate Lien, Series 1991B,
6.750%, 12/01/21 (Alternative Minimum Tax)
- ------------------------------------------------------------------------------------------------------------------------------------
U.S. Guaranteed - 32.5%
1,930,000 Central Michigan University, Revenue Bonds, Series 1997, 4/07 at 101 AAA 2,156,138
5.500%, 10/01/17 (Pre-refunded to 4/01/07)
2,000,000 School District of the City of Detroit, Wayne County, Michigan, School 5/06 at 102 AAA 2,255,000
Building and Site Improvement Bonds (Unlimited Tax - General
Obligation), Series 1996A, 5.700%, 5/01/25 (Pre-refunded to 5/01/06)
180,000 City of Detroit, County of Wayne, Michigan, Sewage Disposal No Opt. Call Aaa 186,203
System Revenue Bonds, 1979 Series, 6.900%, 12/15/99
1,000,000 Essexville-Hampton Public Schools, County of Bay, State of 5/07 at 100 AAA 1,110,830
Michigan, 1997 School Building and Site Bonds (General Obligation -
Unlimited Tax), 5.500%, 5/01/17 (Pre-refunded to 5/01/07)
1,600,000 Gaylord Community Schools, Counties of Ostego and Antrim, 5/02 at 102 AA+*** 1,779,056
State of Michigan, 1992 School Building and Site Refunding Bonds,
6.600%, 5/01/21 (Pre-refunded to 5/01/02)
1,325,000 Greenville Public Schools, Counties of Montcalm, Kent and Ionia, 5/04 at 101 AAA 1,466,841
State of Michigan, 1995 School Building and Site Bonds (General
Obligation - Unlimited Tax), 5.750%, 5/01/14 (Pre-refunded to 5/01/04)
1,000,000 Grosse Ile Township School District, School Improvement Refunding 5/07 at 100 AAA 1,145,800
Bonds, General Obligation, Series 1996, 6.000%, 5/01/22
(Pre-refunded to 5/01/07)
1,250,000 Gull Lake Community Schools, Counties of Kalamazoo, Barry 5/01 at 102 AAA 1,368,200
and Calhoun, State of Michigan, 1991 School Building and
Site Bonds, 6.800%, 5/01/21 (Pre-refunded to 5/01/01)
3,100,000 Hemlock Public School District, Counties of Saginaw and Midland, 5/02 at 102 AA+*** 3,469,272
State of Michigan, 1992 School Building and Site Refunding Bonds,
6.750%, 5/01/21 (Pre-refunded to 5/01/02)
1,000,000 Huron Valley School District, Counties of Oakland and Livingston, 5/07 at 100 AAA 1,137,060
State of Michigan, 1996 School Building and Site Bonds
(General Obligation - Unlimited Tax), 5.875%, 5/01/16
(Pre-refunded to 5/01/07)
2,000,000 Lincoln Park School District, General Obligation Bonds, Series 1996, 5/06 at 101 AAA 2,271,740
5.900%, 5/01/26 (Pre-refunded to 5/01/06)
1,000,000 Marquette Area Public Schools, County of Marquette, State of 5/01 at 102 AAA 1,092,410
Michigan, 1991 School Building and Site Bonds, Series B (General
Obligation - Unlimited Tax), 6.700%, 5/01/21 (Pre-refunded to 5/01/01)
3,100,000 Michigan Municipal Bond Authority, State Revolving Fund Reserve 10/02 at 102 AA+*** 3,481,145
Bonds, Series 1992A, 6.600%, 10/01/18 (Pre-refunded to 10/01/02)
3,035,000 Michigan State Hospital Finance Authority, Hospital Revenue 12/02 at 102 AAA 3,453,830
Bonds (Mid-Michigan Obligated Group), Series 1992,
6.900%, 12/01/24 (Pre-refunded to 12/01/02)
1,450,000 Michigan State Hospital Finance Authority, Hospital Revenue 9/01 at 102 Aaa 1,627,872
Bonds (McLaren Obligated Group), Series 1991A, 7.500%, 9/15/21
(Pre-refunded to 9/15/01)
9,355,000 Michigan State Hospital Finance Authority, Hospital Revenue 11/01 at 102 Aa2*** 10,416,231
Bonds (Daughters of Charity National Health System-Providence
Hospital), Series 1991, 7.000%, 11/01/21 (Pre-refunded to 11/01/01)
7,200,000 State of Michigan, State Trunk Line Fund Bonds, Series 1989A, 8/99 at 102 AAA 7,501,968
7.000%, 8/15/17 (Pre-refunded to 8/15/99)
2,150,000 North Branch Area Schools, County of Lapeer, State of Michigan, 5/02 at 102 AA+*** 2,390,607
1992 School Building and Site Refunding Bonds, (General
Obligation - Unlimited Tax), 6.600%, 5/01/17 (Pre-refunded to 5/01/02)
1,500,000 Perry Public Schools, Counties of Shiawassee and Ingham, 5/02 at 101 1/2 AAA 1,653,315
State of Michigan, 1992 School Building and Site Bonds (General
Obligation - Unlimited Tax), 6.375%, 5/01/22 (Pre-refunded to 5/01/02)
<PAGE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
U.S. Guaranteed (continued)
$ 4,650,000 Plymouth-Canton Community Schools, Counties of Wayne and 5/01 at 101 AA+*** $5,043,297
Washtenaw, State of Michigan, 1991 School Building and Site
Refunding Bonds, Series B, 6.800%, 5/01/11 (Pre-refunded to 5/01/01)
620,000 Reeths-Puffer Schools, County of Muskegon, State of Michigan, 5/05 at 101 AAA 692,893
1995 School Building and Site Refunding Bonds, 5.750%, 5/01/15
(Pre-refunded to 5/01/05)
6,385,000 City of Royal Oak Hospital Finance Authority (Michigan), Hospital 1/01 at 102 Aaa 6,912,337
Revenue Bonds (William Beaumont Hospital), Series 1991D,
6.750%, 1/01/20 (Pre-refunded to 1/01/01)
4,845,000 Saginaw-Midland Municipal Water Supply Corporation, State of 9/04 at 102 A*** 5,689,968
Michigan, Water Supply Revenue Bonds (Limited Tax - General
Obligation), Series 1992, 6.875%, 9/01/16 (Pre-refunded to 9/01/04)
2,400,000 Three Rivers Community Schools, Counties of Cass and St. Joseph, 5/06 at 102 AAA 2,741,160
State of Michigan, 1996 School Building and Site Bonds (General
Obligation - Unlimited Tax), 6.000%, 5/01/23 (Pre-refunded to 5/01/06)
9,250,000 Regents of the University of Michigan, Medical Service Plan Revenue 12/01 at 102 Aa2*** 10,199,883
Bonds, Series 1991, 6.500%, 12/01/21 (Pre-refunded to 12/01/01)
4,200,000 Warren Consolidated Schools, Counties of Macomb and Oakland, 5/01 at 102 Aa*** 4,585,224
State of Michigan, 1991 School Building and Site Refunding Bonds
(General Obligation - Unlimited Tax), 6.700%, 5/01/21
(Pre-refunded to 5/01/01)
- ------------------------------------------------------------------------------------------------------------------------------------
Utilities - 15.8%
6,425,000 The Economic Development Corporation of the City of Detroit, 5/01 at 102 AAA 6,948,252
Resource Recovery Revenue Bonds, Series 1991A, 6.875%, 5/01/09
(Alternative Minimum Tax)
2,390,000 Michigan South Central Power Agency, Power Supply System 11/01 at 102 Baa1 2,575,464
Revenue Refunding Bonds, 1991 Series, 6.750%, 11/01/10
3,630,000 Michigan Strategic Fund, Adjustable Rate Demand Limited Obligation No Opt. Call AAA 4,687,855
Refunding Revenue Bonds (The Detroit Edison Company - Pollution
Control Bonds Project), Series 1990BB, 7.000%, 5/01/21
4,330,000 Michigan Strategic Fund, Limited Obligation Refunding Revenue 9/01 at 102 AAA 4,729,832
Bonds (The Detroit Edison Company - Pollution Control Bonds Project),
Collateralized Series 1991CC, 6.950%, 9/01/21
7,600,000 Michigan Strategic Fund Limited Obligation Refunding Revenue 12/01 at 102 AAA 8,336,668
Bonds (The Detroit Edison Company - Pollution Control Bonds
Project), Collateralized Series 1991DD, 6.875%, 12/01/21
7,000,000 County of Monroe, Michigan, Pollution Control Revenue Bonds 9/02 at 102 AAA 7,774,060
(The Detroit Edison Company/Monroe and Fermi Plants Project),
Collateralized Series I 1992, 6.875%, 9/01/22 (Alternative Minimum Tax)
1,000,000 Puerto Rico Electric Power Authority, Power Revenue Bonds, Series X, 7/05 at 100 BBB+ 1,035,180
5.500%, 7/01/25
5,000,000 City of Wyandotte, County of Wayne, State of Michigan, 10/02 at 102 AAA 5,493,000
1992 Electric Revenue Refunding Bonds, 6.250%, 10/01/17
- ------------------------------------------------------------------------------------------------------------------------------------
Water and Sewer - 4.2%
5,000,000 City of Detroit, Michigan, Sewage Disposal System Revenue Bonds, 7/07 at 101 AAA 4,973,499
Series 1997-A, 5.000%, 7/01/27
6,000,000 City of Detroit, Michigan, Water Supply System Revenue and Revenue 7/04 at 102 AAA 5,970,419
Refunding Bonds, Series 1993, 5.000%, 7/01/23
- ------------------------------------------------------------------------------------------------------------------------------------
$ 243,405,000 Total Investments - (cost $236,690,057) - 98.6% 260,060,973
=============
Temporary Investments in Short-Term Municipal Securities - 0.6%
$ 1,500,000 University of Michigan Hospital, Variable Rate Demand Bonds, 3.200%, 12/01/19+ VMIG-1 1,500,000
--------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 0.8% 2,116,793
--------------------------------------------------------------------------------------------------------------------
Net Assets - 100% $263,677,766
====================================================================================================================
* Optional Call Provisions: Dates (month and year) and prices of the earliest
optional call or redemption. There may be other call provisions at varying
prices at later dates.
** Ratings: Using the higher of Standard & Poor's or Moody's rating.
*** Securities are backed by an escrow or trust containing sufficient U.S.
government or U.S. government agency securities which ensures the timely
payment of principal and interest. Securities are normally considered to be
equivalent to AAA rated securities.
N/R Investment is not rated.
(WI) Security purchased on a when-issued basis (note 1).
+ Security has a maturity of more than one year, but has variable rate and
demand features which qualify it as a term security. The rate disclosed is
that currently in effect. This rate changes periodically based on market
conditions or a specified market index.
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
Portfolio of Investments
Nuveen Michigan Premium Income Municipal Fund, Inc. (NMP)
January 31, 1999
(Unaudited)
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Capital Goods - 2.7%
$ 3,050,000 Michigan Strategic Fund, Limited Obligation Revenue Bonds (Waste 12/02 at 102 BBB+ $3,298,667
Management, Inc. Project), Series 1992, 6.625%, 12/01/12
(Alternative Minimum Tax)
1,370,000 Michigan Strategic Fund, Limited Obligation Revenue Bonds 12/03 at 102 A1 1,435,102
(WMX Technologies, Inc. Project), Series 1993, 6.000%, 12/01/13
(Alternative Minimum Tax)
- ------------------------------------------------------------------------------------------------------------------------------------
Education and Civic Organizations - 6.0%
1,950,000 Board of Regents of Eastern Michigan University, General Revenue 12/06 at 101 AAA 2,058,810
Bonds, Series 1997, 5.500%, 6/01/17
1,250,000 Michigan Higher Education Student Loan Authority, Student 10/02 at 102 A 1,331,450
Loan and Refunding Revenue Bonds, Series XV-A,
6.700%, 10/01/05 (Alternative Minimum Tax)
1,130,000 Board of Trustees of Oakland University, Michigan, General Revenue 5/05 at 102 AAA 1,225,293
Bonds, Series 1995, 5.750%, 5/15/15
2,530,000 Board of Control of Saginaw Valley University, General Revenue 7/08 at 102 AAA 2,601,068
Bonds, Series 1998, 5.250%, 7/01/19
3,250,000 Board of Trustees of Western Michigan University, General Revenue 7/03 at 102 AAA 3,394,300
Bonds, Series 1993A, 5.500%, 7/15/16
- ------------------------------------------------------------------------------------------------------------------------------------
Health Care - 19.1%
2,200,000 City of Hancock Hospital Finance Authority, FHA-Insured Mortgage 8/08 at 100 AAA 2,268,288
Hospital Revenue Bonds (Portage Health System, Inc.), Series 1998,
5.450%, 8/01/47
4,000,000 City of Kalamazoo Hospital Finance Authority, Hospital Revenue 5/06 at 102 AAA 4,295,880
Refunding and Improvement Bonds (Bronson Methodist Hospital),
Series 1996, 5.750%, 5/15/16
3,000,000 Michigan State Hospital Finance Authority (Michigan), Hospital 5/03 at 102 AAA 3,264,480
Revenue Refunding Bonds (St. John Hospital), Series 1993A,
6.000%, 5/15/13
Michigan State Hospital Finance Authority, Revenue and Refunding
Bonds (The Detroit Medical Center Obligated Group), Series 1993A:
3,000,000 6.250%, 8/15/13 8/03 at 102 A- 3,128,850
3,200,000 6.500%, 8/15/18 8/03 at 102 A- 3,380,960
4,000,000 Michigan State Hospital Finance Authority, Hospital Revenue 11/03 at 102 AAA 4,207,880
Refunding Bonds (Oakwood Hospital Obligated Group),
Series 1993A, 5.500%, 11/01/13
4,000,000 Michigan State Hospital Finance Authority, Hospital Revenue and 9/02 at 102 AA- 4,213,600
Refunding Bonds (Henry Ford Health System), Series 1992A,
5.750%, 9/01/17
2,000,000 Michigan State Hospital Finance Authority, Hospital Revenue 1/05 at 102 AA- 2,187,300
and Refunding Bonds (Otsego Memorial Hospital, Gaylord, Michigan),
Series 1995, 6.250%, 1/01/20
1,500,000 Michigan State Hospital Finance Authority, Hospital Revenue Bonds 8/08 at 101 A- 1,387,950
(The Detroit Medical Center Obligated Group), Series 1998A,
5.250%, 8/15/28
2,000,000 Michigan State Hospital Finance Authority, Hospital Revenue 5/09 at 101 AA+ 1,969,400
Bonds (Charity Obligated Group), Series 1999A, 5.125%, 11/01/29 (WI)
3,000,000 Regents of the University of Michigan, Hospital Revenue Refunding 12/02 at 102 AA 3,087,930
Bonds, Series 1993A, 5.500%, 12/01/21
- ------------------------------------------------------------------------------------------------------------------------------------
Housing/Multifamily - 9.3%
2,400,000 Michigan State Housing Development Authority, Limited Obligation 4/04 at 103 AAA 2,541,576
Revenue Bonds (Walled Lake Villa Project), Series 1993,
6.000%, 4/15/18
1,500,000 Michigan State Housing Development Authority, Limited Obligation 10/03 at 103 AAA 1,548,600
Revenue Bonds (Brenton Village Green Project), Series 1993,
5.625%, 10/15/18
Michigan State Housing Development Authority, Rental Housing
Revenue Bonds, 1992 Series A:
4,000,000 6.500%, 4/01/06 10/02 at 102 AA- 4,327,120
4,075,000 6.600%, 4/01/12 10/02 at 102 AA- 4,404,627
<PAGE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Housing/Multifamily (continued)
$ 790,000 Michigan State Housing Development Authority, Rental Housing 4/03 at 102 AAA $ 833,118
Revenue Bonds, 1993 Series A, 5.875%, 10/01/17
Mount Clemens Housing Corporation, Multifamily Housing Refunding
Revenue Bonds, Series 1992A (FHA Insured Mortgage Loan - Section 8
Assisted Project):
1,000,000 6.600%, 6/01/13 6/03 at 102 AAA 1,071,690
1,500,000 6.600%, 6/01/22 6/03 at 102 AAA 1,601,490
- ------------------------------------------------------------------------------------------------------------------------------------
Housing/Single Family - 2.6%
4,295,000 Michigan State Housing Development Authority, Single Family 6/05 at 102 AA+ 4,571,297
Mortgage Revenue Bonds, 1995 Series A, 6.800%, 12/01/16
- ------------------------------------------------------------------------------------------------------------------------------------
Tax Obligation/General - 14.5%
2,400,000 Chippewa Valley Schools, County of Macomb, State of Michigan, 5/03 at 102 AAA 2,388,648
1993 Refunding Bonds (General Obligation - Unlimited Tax),
5.000%, 5/01/21
3,000,000 Clarkston Community Schools, County of Oakland, State of Michigan, 5/03 at 102 AA+ 3,225,570
1993 School Building and Site Refunding Bonds, 5.900%, 5/01/16
2,500,000 School District of the City of Detroit, Wayne County, Michigan, 5/01 at 102 AA+ 2,706,750
School Building and Site Bonds (Unlimited Tax - General Obligation),
Series 1992, 6.250%, 5/01/12
3,000,000 Dexter Community Schools, Counties of Washtenaw and Livingston, 5/03 at 102 AA+ 3,018,180
State of Michigan, 1993 School Building and Site Refunding Bonds
(General Obligation - Unlimited Tax), 5.000%, 5/01/17
2,000,000 Oakridge Public Schools, Counties of Muskegon and Newaygo, 5/08 at 100 AAA 2,011,560
State of Michigan, 1998 School Building and Site Bonds (General
Obligation - Unlimited Tax), 5.125%, 5/01/28
4,100,000 Commonwealth of Puerto Rico, Public Improvement Bonds of 1997, 7/07 at 101 1/2 A 4,445,466
5.750%, 7/01/17
5,625,000 Commonwealth of Puerto Rico, Public Improvement Refunding Bonds, No Opt. Call AAA 6,210,338
Series 1993, 5.375%, 7/01/06
380,000 Reeths-Puffer Schools, County of Muskegon, State of Michigan, 5/05 at 101 AAA 409,032
1995 School Building and Site Refunding Bonds, 5.750%, 5/01/15
1,000,000 Western Townships Utilities Authority, Sewage Disposal System 1/02 at 100 AAA 1,074,550
Refunding Bonds, Series 1991, 6.500%, 1/01/10
- ------------------------------------------------------------------------------------------------------------------------------------
Tax Obligation/Limited - 11.0%
6,500,000 City of Detroit, Michigan, Convention Facility Limited Tax Revenue 9/03 at 102 AAA 6,829,355
Refunding Bonds (Cobo Hall Expansion Project), Series 1993,
5.250%, 9/30/12
1,400,000 City of Detroit (Michigan), Downtown Development Authority, 7/08 at 100 AAA 1,351,910
Tax Increment Refunding Bonds (Development Area No. 1 Projects),
Series 1998A, 4.750%, 7/01/25
2,750,000 State Building Authority, State of Michigan, 1991 Revenue 10/01 at 102 AA 2,950,640
Refunding Bonds, Series I, 6.250%, 10/01/20
1,000,000 State Building Authority, State of Michigan, 1991 Revenue Bonds, 10/01 at 102 AA 1,072,960
Series II, 6.250%, 10/01/20
3,275,000 State of Michigan, Comprehensive Transportation Bonds, 5/02 at 100 AA- 3,455,747
Series 1992A, 5.750%, 5/15/12
3,615,000 Saginaw-Midland Municipal Water Supply Corporation, State 9/02 at 101 1/2 A 3,739,645
of Michigan, Water Supply System Revenue Bonds (Limited Tax -
General Obligation), Series 1993, 5.250%, 9/01/16
- ------------------------------------------------------------------------------------------------------------------------------------
Transportation - 0.6%
1,000,000 Puerto Rico Ports Authority, Special Facilities Revenue Bonds, 6/03 at 102 BBB- 1,063,580
1993 Series A (American Airlines, Inc. Project), 6.300%, 6/01/23
(Alternative Minimum Tax)
- ------------------------------------------------------------------------------------------------------------------------------------
U.S. Guaranteed - 7.2%
2,000,000 Board of Control of Ferris State University, General Revenue Bonds, 10/03 at 102 AAA 2,263,040
Series 1993, 6.250%, 10/01/19 (Pre-refunded to 10/01/03)
1,950,000 Michigan Municipal Bond Authority, State Revolving Fund Revenue No Opt. Call AA+ 2,231,307
Bonds, Series 1994, 7.000%, 10/01/03
2,500,000 Michigan State Hospital Finance Authority, Hospital Revenue 11/01 at 102 Aa2*** 2,783,600
Bonds (Daughters of Charity National Health System - Providence
Hospital), Series 1991, 7.000%, 11/01/21 (Pre-refunded to 11/01/01)
1,750,000 State of Michigan, State Trunk Line Fund Bonds, Series 1994A, 11/04 at 102 AAA 1,962,660
5.700%, 11/15/15 (Pre-refunded to 11/15/04)
<PAGE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
U.S. Guaranteed (continued)
$ 620,000 Reeths-Puffer Schools, County of Muskegon, State of Michigan, 5/05 at 101 AAA $ 692,893
1995 School Building and Site Refunding Bonds, 5.750%, 5/01/15
(Pre-refunded to 5/01/05)
2,650,000 Regents of the University of Michigan, Hospital Revenue Bonds, 12/00 at 100 AA*** 2,800,812
Series 1990, 6.375%, 12/01/24 (Pre-refunded to 12/01/00)
- ------------------------------------------------------------------------------------------------------------------------------------
Utilities - 18.8%
6,750,000 The City of Grand Haven, Michigan, Electric System Revenue Refunding 7/03 at 102 AAA 6,929,010
Bonds, 1993 Series, 5.250%, 7/01/16
4,020,000 Michigan Public Power Agency, Belle River Project Refunding Revenue 1/03 at 102 AA- 4,075,958
Bonds, 1993 Series A, 5.250%, 1/01/18
1,500,000 Michigan Public Power Agency, Belle River Project Refunding Revenue 1/03 at 100 AA- 1,497,120
Bonds, 1993 Series B, 5.000%, 1/01/19
8,500,000 Michigan Strategic Fund, Limited Obligation Refunding Revenue 6/03 at 102 AAA 9,273,670
Bonds (Consumers Power Company Project), Collateralized
Series 1993B, 5.800%, 6/15/10
County of Monroe, Michigan, Pollution Control Revenue Bonds (The
Detroit Edison Company Project), Series CC-1992:
2,500,000 6.550%, 6/01/24 (Alternative Minimum Tax) 6/03 at 102 AAA 2,770,825
1,500,000 6.550%, 9/01/24 (Alternative Minimum Tax) 9/03 at 102 AAA 1,669,455
6,000,000 County of Monroe, Michigan, Pollution Control Revenue Bonds No Opt. Call AAA 6,714,420
(The Detroit Edison Company Project), Series A-1994,
6.350%, 12/01/04 (Alternative Minimum Tax)
- ------------------------------------------------------------------------------------------------------------------------------------
Water and Sewer - 6.7%
1,500,000 City of Ann Arbor, County of Washtenaw, State of Michigan, 2/03 at 101 1/2 AAA 1,606,605
Water Supply System Revenue Bonds, Series T, 5.500%, 2/01/13
1,730,000 City of Detroit, Michigan, Sewage Disposal System Revenue Bonds, 7/07 at 101 AAA 1,721,661
Series 1997-A, 5.000%, 7/01/22
3,755,000 City of Detroit, Michigan, Sewage Disposal System Revenue and 7/03 at 102 AAA 4,052,809
Revenue Refunding Bonds, Series 1993-A, 5.700%, 7/01/13
4,500,000 City of Detroit, Michigan, Water Supply System Revenue and Revenue 7/04 at 102 AAA 4,382,191
Refunding Bonds, Series 1993, 4.750%, 7/01/19
- ------------------------------------------------------------------------------------------------------------------------------------
$ 163,260,000 Total Investments - (cost $158,943,298) - 98.5% 173,018,693
=============
Temporary Investments in Short-Term Municipal Securities - 0.4%
$ 800,000 University of Michigan Hospital, Variable Rate Demand Bonds, VMIG-1 800,000
============= 3.200%, 12/01/19+
Other Assets Less Liabilities - 1.1% 1,920,440
--------------------------------------------------------------------------------------------------------------------
Net Assets - 100% $175,739,133
====================================================================================================================
* Optional Call Provisions: Dates (month and year) and prices of the earliest
optional call or redemption. There may be other call provisions at varying
prices at later dates.
** Ratings: Using the higher of Standard & Poor's or Moody's rating.
*** Securities are backed by an escrow or trust containing sufficient U.S.
government or U.S. government agency securities which ensures the timely
payment of principal and interest. Securities are normally considered to be
equivalent to AAA rated securities.
(WI) Security purchased on a when-issued basis (note 1).
+ Security has a maturity of more than one year, but has variable rate and
demand features which qualify it as a term security. The rate disclosed is
that currently in effect. This rate changes periodically based on market
conditions or a specified market index.
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
Portfolio of Investments
Nuveen Ohio Quality Income Municipal Fund, Inc. (NUO)
January 31, 1999
(Unaudited)
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Capital Goods - 1.3%
$ 2,850,000 Ohio Water Development Authority, Revenue Bonds, USA Waste 3/02 at 102 N/R $3,061,214
Services, Series 1992, 7.750%, 9/01/07 (Alternative Minimum Tax)
- ------------------------------------------------------------------------------------------------------------------------------------
Education and Civic Organizations - 8.9%
825,000 Bowling Green State University, Ohio, General Receipts Bonds, 6/01 at 102 A 893,310
Series 1991, 6.700%, 6/01/07
3,665,000 State of Ohio, Education Loan Revenue Bonds, Series 1997A 6/07 at 102 AAA 3,833,957
(Supplemental Student Loan Program), 1997A1, 5.850%, 12/01/19
(Alternative Minimum Tax)
1,000,000 State of Ohio (Ohio Higher Educational Facility Commission), Higher 12/04 at 102 AAA 1,101,280
Educational Facility Revenue Bonds (University of Dayton 1994 Project),
5.800%, 12/01/14
2,400,000 State of Ohio (Ohio Higher Educational Facility Commission), 12/03 at 102 AAA 2,715,504
Higher Educational Facility Mortgage Revenue Bonds (University
of Dayton 1992 Project), 6.600%, 12/01/17
1,200,000 State of Ohio (Ohio Higher Educational Facility Commission), 9/06 at 101 N/R 1,257,828
Higher Educational Facility Revenue Bonds (The University of
Findlay 1996 Project), 6.125%, 9/01/16
1,500,000 State of Ohio (Ohio Higher Educational Facility Commission), No Opt. Call AA 1,790,520
Higher Educational Facility Revenue Bonds (Case Western
Reserve University), 1997 Series D, 6.250%, 7/01/14
1,000,000 State of Ohio (Ohio Higher Educational Facility Commission), 10/02 at 102 AA 1,073,330
Higher Educational Facility Revenue Bonds (Case Western Reserve
University Project), Series 1992, 6.000%, 10/01/22
1,575,000 The Ohio State University, General Receipts Bonds, 12/02 at 102 AA 1,714,640
Series 1992 A1, 5.875%, 12/01/12
2,000,000 Puerto Rico Industrial, Tourist, Educational, Medical and 10/08 at 101 AAA 2,007,760
Environmental Control Facilities Financing Authority, Higher
Education Revenue Bonds, 1998 Series A (Inter-American University
of Puerto Rico Project), 5.000%, 10/01/22
3,185,000 The Student Loan Funding Corporation, Cincinnati, Ohio, Student 7/02 at 100 A 3,301,284
Loan Subordinated Revenue Refunding Bonds, Series 1992 D,
6.600%, 7/01/05 (Alternative Minimum Tax)
1,400,000 University of Cincinnati (Ohio), General Receipts Bonds, Series AB, 6/07 at 100 AAA 1,447,404
5.375%, 6/01/20
- ------------------------------------------------------------------------------------------------------------------------------------
Energy - 1.9%
2,000,000 County of Ashtabula, Ohio, Industrial Development Refunding 5/02 at 102 Baa2 2,148,600
Revenue Bonds, 1992 Series A (Ashland Oil, Inc. Project),
6.900%, 5/01/10
2,250,000 Ohio Air Quality Development Authority, State of Ohio, Air Quality 4/01 at 102 Baa1 2,407,658
Development Refunding Revenue Bonds, Series 1992 (Ashland
Oil, Inc. Project), 6.850%, 4/01/10
- ------------------------------------------------------------------------------------------------------------------------------------
Health Care - 10.7%
1,300,000 Akron, Bath and Copley Joint Township Hospital District, Ohio, 11/03 at 102 Baa1 1,305,070
Hospital Facilities Revenue Bonds, Series 1993A (Summa Health
System Project), 5.500%, 11/15/13
240,000 County of Butler, Ohio, Hospital Facilities Revenue Refunding and No Opt. Call BBB- 245,909
Improvement Bonds, Series 1991 (Fort Hamilton-Hughes Memorial
Hospital Center), 7.250%, 1/01/01
1,000,000 County of Butler, Ohio, Hospital Facilities Revenue Refunding and 1/02 at 102 BBB- 1,076,360
Improvement Bonds, Series 1991 (Fort Hamilton-Hughes Memorial
Hospital Center), 7.500%, 1/01/10
City of Cambridge, Ohio, Hospital Revenue Refunding Bonds,
Series 1991 (Guernsey Memorial Hospital Project):
1,680,000 8.000%, 12/01/06 12/01 at 102 BBB 1,841,347
750,000 8.000%, 12/01/11 12/01 at 102 BBB 822,030
2,675,000 County of Clermont, Ohio, Hospital Facilities Revenue Refunding 1/03 at 102 AAA 2,846,254
Bonds, Series 1993 A (Mercy Health System), 5.875%, 1/01/15
1,000,000 County of Cuyahoga, Ohio, Hospital Improvement and Refunding 2/07 at 102 AAA 1,064,700
Revenue Bonds, Series 1997 (The MetroHealth System Project),
5.625%, 2/15/17
1,500,000 County of Cuyahoga, Ohio, Hospital Improvement Revenue Bonds, 1/02 at 102 AA 1,622,715
Series 1992 (University Hospitals Health System, Inc. Project),
6.500%, 1/15/19
<PAGE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Health Care (continued)
$ 1,170,000 County of Cuyahoga, Ohio, Hospital Facilities Revenue Bonds, 2/03 at 102 A1 $1,272,270
Series 1993, Health Cleveland, Inc. (Fairview General Hospital
Project), 6.300%, 8/15/15
County of Franklin, Ohio, Hospital Refunding and Improvement
Revenue Bonds, 1996 Series A (The Children's Hospital Project):
1,000,000 5.750%, 11/01/20 11/06 at 101 Aa 1,066,810
1,500,000 5.875%, 11/01/25 11/06 at 101 Aa 1,613,145
1,500,000 County of Franklin, Ohio, Hospital Revenue Refunding and 11/02 at 102 Aa 1,668,570
Improvement Bonds, 1992 Series A (The Children's Hospital Project),
6.600%, 5/01/13
3,250,000 City of Garfield Heights, Ohio, Hospital Improvement and Refunding 11/02 at 102 A 3,599,408
Revenue Bonds, Series 1992B (Marymount Hospital Project),
6.650%, 11/15/11
2,500,000 County of Marion, Ohio, Hospital Refunding and Improvement 5/06 at 102 BBB+ 2,737,775
Revenue Bonds, Series 1996 (The Community Hospital),
6.375%, 5/15/11
1,500,000 County of Montgomery, Ohio, Hospital Facilities Revenue Refunding 4/06 at 102 AAA 1,597,140
and Improvement Bonds, Series 1996 (Kettering Medical Center),
5.625%, 4/01/16
750,000 County of Tuscarawas, Ohio, Hospital Facilities Revenue Bonds, 10/03 at 102 Baa2 799,140
Series 1993A (Union Hospital Project), 6.500%, 10/01/21
- ------------------------------------------------------------------------------------------------------------------------------------
Housing/Multifamily - 8.0%
1,385,000 County of Clermont, Ohio, Mortgage Revenue Bonds (GNMA 8/03 at 103 Aaa 1,446,549
Collateralized - S.E.M. Villa II Project), Series 1994-A,
5.950%, 2/20/30
1,435,000 County of Cuyahoga, Ohio, Multifamily Housing Revenue Bonds 6/08 at 105 Aaa 1,568,785
(Water Street Associates), Series 1997, 6.150%, 12/20/26
(Alternative Minimum Tax)
990,000 County of Franklin, Ohio, Multifamily Housing Mortgage Revenue 1/05 at 103 Aa 1,003,860
Bonds, Series 1994A (FHA Insured Mortgage Loan - Hamilton
Creek Apartments Project), 5.550%, 7/01/24
(Alternative Minimum Tax)
6,170,000 County of Franklin, Ohio, Mortgage Revenue Bonds, 1/02 at 103 Aa 6,550,442
Series 1992A (FHA Insured Mortgage Loan - Kensington Place
Project), 6.750%, 1/01/34
5,200,000 Hamilton County, Multi-Family Housing Revenue Bonds 1/07 at 102 AAA 5,419,700
(Huntington Meadows Project), Series 1997, 5.700%, 1/01/27
(Alternative Minimum Tax)
2,885,000 Ohio Capital Corporation for Housing, Mortgage Revenue 1/02 at 100 AAA 2,927,410
Refunding Bonds, FHA Section 8 Assisted Project, Series 1997C,
5.700%, 1/01/24
- ------------------------------------------------------------------------------------------------------------------------------------
Housing/Single Family - 4.8%
3,980,000 Ohio Housing Finance Agency, Residential Mortgage Revenue 9/07 at 102 AAA 4,153,011
Bonds, 1996 Series B-3 (Mortgage-Backed Securities Program),
5.750%, 9/01/28 (Alternative Minimum Tax)
6,965,000 Ohio Housing Finance Agency, Single Family Mortgage Revenue 9/99 at 102 AAA 7,149,851
Bonds (GNMA Mortgage-Backed Securities Program), 1989 Series A,
7.650%, 3/01/29 (Alternative Minimum Tax)
- ------------------------------------------------------------------------------------------------------------------------------------
Long Term Care - 1.0%
1,365,000 County of Franklin, Ohio, Health Care Facilities Revenue Bonds, 7/03 at 102 N/R 1,390,239
Series 1993 (Ohio Presbyterian Retirement Services),
6.500%, 7/01/23
1,000,000 County of Marion, Ohio, Health Care Facilities Refunding and 11/03 at 102 BBB- 1,055,170
Improvement Revenue Bonds, Series 1993 (United Church
Homes, Inc. Project), 6.300%, 11/15/15
- ------------------------------------------------------------------------------------------------------------------------------------
Tax Obligation/General - 14.5%
Berea City School District, Ohio, School Improvement Bonds,
Series 1993 (General Obligation - Unlimited Tax Bonds):
650,000 7.500%, 12/15/06 12/03 at 102 AAA 768,859
680,000 7.450%, 12/15/07 12/03 at 102 AAA 802,842
1,750,000 Brecksville-Broadview Heights City School District, Ohio, School 12/06 at 102 AAA 2,037,140
Improvement Bonds, Series 1996 (General Obligation - Unlimited
Tax Bonds), 6.500%, 12/01/16
2,000,000 City of Columbus, Ohio, General Obligation Refunding Bonds, 1/02 at 102 Aaa 2,195,480
Series 1992B, 6.500%, 1/01/10
1,300,000 County of Franklin, Ohio, Refunding Bonds, Series 1993 12/08 at 102 AAA 1,372,241
(Limited Tax - General Obligation Bonds), 5.375%, 12/01/20
<PAGE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Tax Obligation/General (continued)
$ 1,505,000 Greater Cleveland Regional Transit Authority, General Obligation, 12/06 at 101 Aaa $1,699,521
Capital Improvement Bonds, Series 1996, 5.650%, 12/01/16
North Canton City School District, Ohio, School Improvement
Bonds, Series 1994 (General Obligation - Unlimited Tax):
650,000 9.750%, 12/01/03 No Opt. Call AAA 823,037
715,000 9.700%, 12/01/04 No Opt. Call AAA 934,198
1,260,000 Oak Hills Local School District, Hamilton County, Ohio, School No Opt. Call AAA 1,598,764
Facilities Construction and Improvement Bonds, Series B (General
Obligation-Unlimited Tax), 6.900%, 12/01/13
2,000,000 Commonwealth of Puerto Rico, Public Improvement Bonds 7/06 at 101 1/2 A 2,067,800
of 1996 (General Obligation Bonds), 5.400% 7/01/25
1,300,000 Commonwealth of Puerto Rico, Public Improvement Bonds of 1997, 7/07 at 101 1/2 A 1,409,538
5.750%, 7/01/17
2,400,000 Commonwealth of Puerto Rico, Public Improvement Bonds of 1998, 7/08 at 101 A 2,387,280
5.000%, 7/01/27
1,000,000 Revere Local School District, Ohio, School Improvement Bonds, 12/03 at 102 AAA 1,105,280
Series 1993 (General Obligation - Unlimited Tax Bonds),
6.000%, 12/01/16
2,870,000 City of Strongsville, Ohio, Various Purpose Improvement Bonds, 12/06 at 102 Aa3 3,135,705
Series 1996 (General Obligation - Limited Tax), 5.950%, 12/01/21
1,000,000 Sylvania City School District, Series 1995 (General Obligation - 12/05 at 101 AAA 1,087,600
Unlimited Tax), 5.800%, 12/01/15
1,135,000 City of Toledo, Ohio, Various Purpose Improvement Bonds, No Opt. Call AAA 1,303,003
Series 1994 (General Obligation - Limited Tax), 7.000%, 12/01/03
1,000,000 Upper Arlington City School District, General Obligation Bonds, 12/06 at 101 AAA 1,021,560
Series 1996, Improvement Bonds, 5.250%, 12/01/22
2,000,000 Board of Education, Wayne Local School District, County of 12/06 at 101 AAA 2,239,560
Warren, Ohio, School Improvement Bonds, Series 1996
(Unlimited Tax - General Obligation), 6.100%, 12/01/24
3,000,000 Board of Education, West Clermont Local School District, 12/05 at 100 AAA 3,309,480
County of Clermont, Ohio, School Improvement Bonds, Series 1995
(Unlimited Tax - General Obligation), 6.000%, 12/01/18
1,000,000 City of Westlake, Ohio, General Obligation, Various Purpose 12/08 at 101 Aaa 1,071,380
Improvement and Refunding Bonds (Series 1997), 5.550%, 12/01/17
1,820,000 Worthington City School District, Franklin County, Ohio, 6/02 at 102 AAA 1,992,827
General Obligation Refunding Bonds (Unlimited Tax), 6.375%, 12/01/12
- ------------------------------------------------------------------------------------------------------------------------------------
Tax Obligation/Limited - 3.0%
1,000,000 State of Ohio (Ohio Building Authority), State Facilities Bonds 10/02 at 102 AA- 1,083,290
(Juvenile Correctional Building Fund Projects), 1992 Series B,
6.000%, 10/01/12
3,000,000 State of Ohio (Ohio Building Authority), State Facilities Bonds 10/03 at 102 AA- 3,297,930
(Adult Correctional Building Fund Projects), 1993 Series A,
6.125%, 10/01/12
1,090,000 State of Ohio Department of Transportation, Certificates of 4/99 at 104 AA- 1,128,542
Participation (Rickenbacker Port Authority Improvements),
6.125%, 4/15/15 (Alternative Minimum Tax)
1,500,000 State of Ohio (OPFC), Higher Education Capital Facilities Bonds, 12/01 at 102 AA- 1,592,175
Series II-1992A, 5.500%, 12/01/06
- ------------------------------------------------------------------------------------------------------------------------------------
Technology - 0.7%
500,000 County of Franklin, Ohio, Revenue Bonds, Series 1993 (Online 4/03 at 100 N/R 518,635
Computer Library Center, Incorporated Project), 6.000%, 4/15/13
1,000,000 Puerto Rico Industrial, Medical and Environmental Pollution Control 1/02 at 103 AA 1,094,070
Facilities Financing Authority, Adjustable Rate Industrial Revenue
Bonds, 1983 Series A (Motorola Inc. Project), 6.750%, 1/01/14
- ------------------------------------------------------------------------------------------------------------------------------------
Transportation - 3.0%
3,430,000 City of Cleveland, Ohio, Parking Facilities Refunding Revenue Bonds, 9/06 at 102 AAA 3,617,244
Series 1996, 5.500%, 9/15/22
Columbus Municipal Airport Authority, Airport Improvement
Revenue Bonds, Series 1994A (Port Columbus International Airport
Project):
830,000 5.950%, 1/01/08 (Alternative Minimum Tax) 1/04 at 102 AAA 908,452
1,000,000 6.000%, 1/01/14 (Alternative Minimum Tax) 1/04 at 102 AAA 1,070,810
1,500,000 City of Dayton, Ohio, Special Facilities Revenue Refunding Bonds, 2/08 at 102 BBB 1,525,230
Series 1998A (Emery Air Freight Corporation and Emery Worldwide
Airlines, Inc.-Guarantors) (Non-AMT), 5.625%, 2/01/18
<PAGE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
U.S. Guaranteed - 23.7%
$ 1,500,000 City of Akron, Ohio, Waterworks System Mortgage Revenue 3/01 at 102 AAA $1,626,165
Improvement Bonds, Series 1991, 6.550%, 3/01/12
(Pre-refunded to 3/01/01)
2,000,000 City of Barberton, Ohio, Hospital Facilities Revenue Bonds, 1/02 at 102 N/R*** 2,237,620
Series 1992 (The Barberton Citizens Hospital Company Project),
7.250%, 1/01/12 (Pre-refunded to 1/01/02)
2,000,000 County of Carroll, Ohio, Hospital Improvement Revenue Bonds, 12/01 at 102 AAA 2,240,860
Series 1991 (Timken Mercy Medical Center), 7.125%, 12/01/18
(Pre-refunded to 12/01/01)
2,500,000 County of Clermont, Ohio, Waterworks System Revenue Bonds, 12/01 at 102 AAA 2,770,000
Series 1991, Clermont County Sewer District, 6.625%, 12/01/14
(Pre-refunded to 12/01/01)
2,075,000 City of Cleveland, Ohio, Airport System Revenue Bonds, 1/00 at 102 AAA 2,197,840
1990 Series A, 7.400%, 1/01/20 (Pre-refunded to 1/01/00)
(Alternative Minimum Tax)
2,000,000 City of Cleveland, Ohio, Public Power System First Mortgage 11/04 at 102 AAA 2,378,780
Revenue Bonds, Series 1994A, 7.000%, 11/15/24
(Pre-refunded to 11/15/04)
1,575,000 City of Cleveland, Ohio, Waterworks Improvement First Mortgage 1/02 at 102 AAA 1,736,595
Revenue Bonds, Series F, 1992 A, 6.500%, 1/01/21
(Pre-refunded to 1/01/02)
2,745,000 City of Cleveland, Ohio, First Mortgage Revenue Refunding Bonds, 1/02 at 102 AAA 3,026,637
Series F, 1992-B, 6.500%, 1/01/11 (Pre-refunded to 1/01/02)
3,960,000 City of Cleveland, Ohio, Waterworks Improvement and Refunding, 1/06 at 102 AAA 4,477,968
First Mortgage Revenue Bonds, Series H 1996, 5.750%, 1/01/26
(Pre-refunded to 1/01/06)
1,950,000 City School District of Columbus, Franklin County, Ohio, School 12/02 at 102 AAA 2,206,269
Building Renovation and Improvement Bonds, Series 1992 (General
Obligation-Unlimited Tax), 6.650%, 12/01/12 (Pre-refunded to 12/01/02)
3,250,000 County of Cuyahoga, Ohio, Hospital Revenue Bonds, Series 1991 8/01 at 102 AAA 3,602,170
(Meridia Health System), 7.000%, 8/15/23 (Pre-refunded to 8/15/01)
2,000,000 Dublin City School District, Franklin, Delaware and Union Counties, 12/02 at 102 AAA 2,226,920
Ohio, Various Purpose School Building Construction and
Improvement Bonds (General Obligation - Unlimited Tax),
6.200%, 12/01/19 (Pre-refunded to 12/01/02)
3,100,000 County of Franklin, Ohio, First Mortgage Revenue, Series 1979 No Opt. Call AAA 3,612,833
(Online Computer Library Center, Incorporated Project),
7.500%, 6/01/09
1,000,000 Hamilton County, Ohio, Sewer System Improvement and Refunding 6/01 at 102 AAA 1,094,750
Revenue Bonds, 1991 Series A (The Metropolitan Sewer District
of Greater Cincinnati), 6.700%, 12/01/13 (Pre-refunded to 6/01/01)
3,000,000 Kent State University (A State University of Ohio), General Receipts 5/02 at 102 AAA 3,332,460
Bonds, Series 1992, 6.500%, 5/01/22 (Pre-refunded to 5/01/02)
1,000,000 City of Lakewood, Ohio, Various Purpose General Obligation Bonds, 12/02 at 102 Aa3*** 1,124,150
Series 1992 (Limited Tax Obligation), 6.500%, 12/01/12
(Pre-refunded to 12/01/02)
2,100,000 Lakota Local School District, County of Butler, Ohio, School 12/05 at 100 AAA 2,414,664
Improvement Bonds (Unlimited Tax - General Obligation),
Series 1994, 6.250%, 12/01/14 (Pre-refunded to 12/01/05)
1,400,000 City of Middleburg Heights, Ohio, Hospital Improvement Revenue 8/01 at 102 AAA 1,542,142
Bonds, Series 1991 (Southwest General Hospital Project),
6.750%, 8/15/21 (Pre-refunded to 8/15/01)
1,000,000 City of Newark, Ohio, Water System Improvement Bonds 12/03 at 102 AAA 1,124,630
(Limited Tax - General Obligation), 6.000%, 12/01/18
(Pre-refunded to 12/01/03)
205,000 Ohio Water Development Authority, State of Ohio, Water 12/00 at 100 AAA 221,123
Development Revenue Refunding Bonds, Refunding and
Improvement Series, 8.000%, 12/01/18 (Pre-refunded to 12/01/00)
2,500,000 Commonwealth of Puerto Rico, Public Improvement Bonds of 1992 7/02 at 101 1/2 AAA 2,794,475
(General Obligation Bonds), 6.600%, 7/01/13 (Pre-refunded to 7/01/02)
1,400,000 Reynoldsburg City School District, Ohio, General Obligation Bonds, 12/02 at 102 AAA 1,579,004
For School Building Construction and Improvement,
6.550%, 12/01/17 (Pre-refunded to 12/01/02)
1,000,000 Solon City School District, Ohio, School Improvement Bonds, 12/01 at 102 N/R*** 1,118,170
Series 1990 (General Obligation - Unlimited Tax),
7.150%, 12/01/13 (Pre-refunded to 12/01/01)
3,500,000 University of Cincinnati, General Receipts Bonds, Series O, 12/02 at 102 AA*** 3,909,570
6.300%, 6/01/12 (Pre-refunded to 12/01/02)
1,000,000 University of Toledo, Ohio, General Receipts Bonds, 12/02 at 102 AAA 1,104,680
Series B, 5.900%, 6/01/20 (Pre-refunded to 12/01/02)
<PAGE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Utilities - 9.0%
$ 3,000,000 City of Cleveland, Ohio, Public Power System Improvement, 11/01 at 102 AAA $3,308,970
First Mortgage Revenue Bonds, Series 1991B, 7.000%, 11/15/17
2,000,000 City of Cleveland, Ohio, Public Power System Revenue Bonds, 11/08 at 101 AAA 2,102,120
Series 1998, 5.250%, 11/15/15
1,250,000 City of Hamilton, Ohio, Electric System Mortgage Revenue Bonds, 10/02 at 102 AAA 1,378,638
1992 Series B, 6.300%, 10/15/25
4,000,000 Ohio Air Quality Development Authority, Collateralized Pollution 6/02 at 103 AAA 4,606,400
Control Revenue Refunding Bonds, Series 1992 (The Cleveland
Electric Illuminating Company Project), 8.000%, 12/01/13
Ohio Air Quality Development Authority, Air Quality Development
Revenue Refunding Bonds (JMG Funding Limited Partnership Project),
Series 1994:
2,000,000 6.375%, 1/01/29 (Alternative Minimum Tax) 10/04 at 102 AAA 2,225,880
4,000,000 6.375%, 4/01/29 (Alternative Minimum Tax) 10/04 at 102 AAA 4,451,760
3,000,000 Ohio Air Quality Development Authority, Air Quality Development 4/07 at 102 AAA 3,136,890
Revenue Bonds (JMG Funding Limited Partnership Project), Series 1997,
5.625%, 1/01/23 (Alternative Minimum Tax)
- ------------------------------------------------------------------------------------------------------------------------------------
Water and Sewer - 8.1%
3,720,000 City of Cleveland, Ohio, Waterworks Improvement, First Mortgage 1/02 at 102 AAA 4,035,791
Revenue Refunding Bonds, Series F, 1992B, 6.250%, 1/01/16
1,000,000 City of Cleveland, Ohio, Waterworks Improvement, First Mortgage No Opt. Call AAA 1,097,830
Refunding Revenue Bonds, Series G 1993, 5.500%, 1/01/21
255,000 City of Cleveland, Ohio, Waterworks Improvement, First Mortgage 1/02 at 102 AAA 279,141
Revenue Refunding Bonds, Series F 1992B, 6.500%, 1/01/11
2,000,000 City of Cleveland, Ohio, Waterworks Improvement and Refunding 1/08 at 101 AAA 2,005,760
Revenue Bonds, Series I 1998, 5.000%, 1/01/28
40,000 City of Cleveland, Ohio, Waterworks Improvement and Refunding, 1/06 at 102 AAA 42,961
First Mortgage Revenue Bonds, Series H 1996, 5.750%, 1/01/26
2,500,000 City of Columbus, Ohio, Sewerage System Revenue Refunding Bonds, 6/02 at 102 AA- 2,732,400
Series 1992, 6.250%, 6/01/08
1,000,000 Greene County, Ohio, Sewer System Revenue Bonds, 1998 Series 12/08 at 102 AAA 1,030,639
(Governmental Enterprise Revenue Bonds), 5.250%, 12/01/25
1,000,000 County of Montgomery, Ohio, Water Revenue Bonds, Greater 11/02 at 102 AAA 1,102,899
Moraine Beavercreek Sewer District, Series 1992, 6.250%, 11/15/17
2,000,000 Northeast Ohio Regional Sewer District, Wastewater Improvement 11/05 at 101 AAA 2,131,439
Revenue Refunding Bonds, Series 1995, 5.600%, 11/15/16
1,000,000 Ohio Water Development Authority, State of Ohio, Water 6/05 at 102 AAA 1,084,949
Development Revenue Bonds, 1995 Fresh Water Series,
5.900%, 12/01/21
1,250,000 City of Oxford, Ohio, Water Supply System Mortgage Revenue, 12/02 at 102 AAA 1,366,349
Series 1992 Refunding Bonds, 6.000%, 12/01/14
2,000,000 Southwest Regional Water District (Ohio), Waterworks System 12/05 at 101 AAA 2,195,099
Revenue Bonds, Series 1995, 6.000%, 12/01/20
- ------------------------------------------------------------------------------------------------------------------------------------
$ 214,200,000 Total Investments - (cost $214,524,261) - 98.6% 232,813,812
=============
Temporary Investments in Short-Term Municipal Securities - 0.4%
$ 1,000,000 Cuyahoga County, Ohio (Cleveland Clinic), Variable Rate Demand Bonds, VMIG-1 1,000,000
============= 3.200%, 1/01/26+
Other Assets Less Liabilities - 1.0% 2,418,748
--------------------------------------------------------------------------------------------------------------------
Net Assets - 100% $236,232,560
====================================================================================================================
* Optional Call Provisions: Dates (month and year) and prices of the earliest
optional call or redemption. There may be other call provisions at varying
prices at later dates.
** Ratings: Using the higher of Standard & Poor's or Moody's rating.
*** Securities are backed by an escrow or trust containing sufficient U.S.
government or U.S. government agency securities which ensures the timely
payment of principal and interest. Securities are normally considered to be
equivalent to AAA rated securities.
N/R Investment is not rated.
+ The security has a maturity of more than one year, but has variable rate
and demand features which qualify it as a short-term security. The rate
disclosed is that currently in effect. This rate changes periodically based
on market conditions or a specified market index.
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
Portfolio of Investments
Nuveen Texas Quality Income Municipal Fund (NTX)
January 31, 1999
(Unaudited)
<PAGE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Basic Materials - 1.5%
$ 3,000,000 Guadalupe-Blanco River Authority, Sewage and Solid Waste Disposal 4/06 at 102 AA- $3,324,060
Facility Bonds (E.I. du Pont de Nemours and Company Project),
Series 1996, 6.400%, 4/01/26 (Alternative Minimum Tax)
- ------------------------------------------------------------------------------------------------------------------------------------
Education and Civic Organizations - 6.8%
2,255,000 Brazos Higher Education Authority, Inc., Student Loan Revenue 3/02 at 102 A 2,459,010
Refunding Bonds, Series 1992-A, 6.875%, 9/01/04
(Alternative Minimum Tax)
1,055,000 Brazos Higher Education Authority, Inc., Student Loan Revenue No Opt. Call Aa 1,179,680
Refunding Bonds, Series 1992C-1, 6.650%, 11/01/04
(Alternative Minimum Tax)
205,000 Brazos Higher Education Authority, Inc. Student Loan Revenue No Opt. Call A 230,076
Refunding Bonds, Subordinate Series 1993A-2, 6.800%, 12/01/04
(Alternative Minimum Tax)
1,000,000 City of Georgetown, Higher Education Finance Corporation, 2/04 at 100 A+ 1,073,640
Higher Education Revenue Bonds, Series 1994 (Southwestern
University Project), 6.300%, 2/15/14
2,500,000 North Texas Higher Educational Authority, Inc., Student 4/03 at 102 Aa 2,627,375
Loan Revenue Bonds, Series 1993C, 6.100%, 4/01/08
(Alternative Minimum Tax)
1,000,000 Southwest Higher Education Authority (Texas), Higher 10/08 at 101 A+ 980,210
Educational Facilities Revenue Bonds (Southern Methodist University),
Series 1998D, 5.000%, 10/01/22
2,500,000 City of Terrell Hills, Texas, Higher Education Facilities Corporation, 3/03 at 101 1/2 AAA 2,641,275
Higher Education Revenue and Refunding Bonds (Incarnate Word
College Project), Series 1993, 5.750%, 3/15/13
1,445,000 Tyler Junion College District (Smith and Van Zanlt Counties, Texas), 8/04 at 100 AAA 1,579,154
Combined Fee Improvement Revenue and Refunding Bonds,
Series 1994, 5.900%, 8/15/13
2,000,000 Board of Regents of The University of Houston System, Consolidated 2/05 at 100 AAA 2,185,360
Revenue Bonds, Series 1995, 6.000%, 2/15/17
- ------------------------------------------------------------------------------------------------------------------------------------
Energy - 4.5%
5,000,000 Gulf Coast Waste Disposal Authority (Valero Energy Corporation Project), 4/08 at 102 BBB- 4,935,700
Series 1998, 5.600%, 4/01/32 (Alternative Minimum Tax)
5,000,000 Gulf Coast Industrial Development Authority, Waste Disposal Revenue 6/08 at 102 BBB- 4,933,000
Bonds (Valero Refining and Marketing Company Project), Series 1997,
5.600%, 12/01/31 (Alternative Minimum Tax)
- ------------------------------------------------------------------------------------------------------------------------------------
Health Care - 15.3%
3,500,000 Abilene Health Facilities Development Corporation (Texas), 9/05 at 102 AAA 3,919,755
Hospital Revenue Refunding and Improvement Bonds (Hendrick
Medical Center Project), Series 1995C, 6.150%, 9/01/25
6,000,000 Bexar County Health Facilities Development Corporation, Health 11/07 at 102 AAA 6,071,040
System Revenue Bonds (Baptist Health System), Series 1997-B,
5.250%, 11/15/31
2,000,000 Brazos County Health Facilities Development Corporation (Texas), 7/07 at 102 AAA 2,054,540
Franciscan Services Corporation, Obligated Group Revenue Bonds,
Series 1997A, 5.375%, 1/01/28
5,750,000 Midland County Hospital District, Hospital Revenue Bonds, No Opt. Call A- 2,984,078
Series 1992, 0.000%, 6/01/11
4,500,000 Port of Corpus Christi Authority of Nueces County (Texas), 4/02 at 102 A+ 4,874,400
Pollution Control Revenue Bonds (Hoechst Celanese Corporation),
Series 1992, 6.875%, 4/01/17 (Alternative Minimum Tax)
5,350,000 Richardson Hospital Authority (Texas), Hospital Revenue Refunding 12/08 at 101 BBB+ 5,277,187
and Improvement Bonds (Baylor/Richardson Medical Center Project),
Series 1998, 5.625%, 12/01/28
1,050,000 Tarrant County Health Facilities Development Corporation (Texas), 11/08 at 101 A- 1,041,915
Hospital Revenue Bonds, Series 1998 (Adventist Health System/Sunbelt
Obligated Group), 5.375%, 11/15/20
1,500,000 Texas Health Facilities Development Corporation, Hospital Revenue 8/03 at 102 AAA 1,659,705
Bonds (All Saints Episcopal Hospitals of Fort Worth Project),
Series 1993B, 6.250%, 8/15/22
5,400,000 Travis County Health Facilities Development Corporation, Hospital 11/03 at 102 Aa 5,795,388
Revenue Bonds (Daughters of Charity National Health System -
Daughters of Charity Health Services of Austin), Series 1993B,
6.000%, 11/15/22
<PAGE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Housing/Multifamily - 2.0%
$ 310,000 Abilene Housing Development Corporation, First Lien Revenue Bonds, No Opt. Call N/R $ 320,134
Series 1978, 7.000%, 7/01/08
4,115,000 San Antonio Housing Finance Corporation (Texas), Multifamily 12/05 at 103 AAA 4,127,345
Housing Revenue Bonds (Harbor Cove Apartments Project), Series 1991
(Remarketing), 5.250%, 12/15/21 (Alternative Minimum Tax)
- ------------------------------------------------------------------------------------------------------------------------------------
Housing/Single Family - 8.1%
1,345,000 Baytown Housing Finance Corporation, Single Family Mortgage 9/02 at 103 Aa2 1,507,059
Revenue Refunding Bonds, Series 1992-A, 8.500%, 9/01/11
1,140,000 El Paso Housing Finance Corporation, Single Family Mortgage 4/01 at 103 A2 1,256,679
Revenue Refunding Bonds, Series 1991A, 8.750%, 10/01/11
845,000 City of Galveston Property Finance Authority, Inc., Single Family 9/01 at 103 A3 910,454
Mortgage Revenue Bonds, Series 1991A, 8.500%, 9/01/11
2,335,000 The Harrison County Finance Corporation, Single Family Mortgage 12/01 at 103 A1 2,479,396
Revenue Refunding Bonds, Series 1991, 8.875%, 12/01/11
1,385,000 Houston Housing Finance Corporation, Single Family Mortgage 6/03 at 102 AAA 1,460,233
Revenue Refunding Bonds, Series 1993A, 5.950%, 12/01/10
865,000 Port Arthur Housing Finance Corporation, Single Family Mortgage 9/02 at 103 A 949,190
Revenue Refunding Bonds, Series 1992, 8.700%, 3/01/12
4,675,000 Texas Department of Housing and Community Affairs, Single Family 9/06 at 102 AAA 4,987,056
Mortgage Revenue Bonds, 1996 Series E, 6.000%, 9/01/17
2,655,000 Travis County Housing Finance Corporation (Texas), Residential 12/01 at 103 AAA 2,835,620
Mortgage Bonds (GNMA and FNMA Mortgage-Backed Securities
Program), Senior Bonds, Series 1991A, 7.050%, 12/01/25
1,245,000 Victoria Housing Finance Corporation, Single Family Mortgage No Opt. Call Aaa 1,387,901
Revenue Refunding Bonds, Series 1995, 8.125%, 1/01/11
- ------------------------------------------------------------------------------------------------------------------------------------
Long Term Care - 3.6%
3,400,000 Bell County Health Facilities Development Corporation, Retirement 11/08 at 101 A- 3,376,336
Facility Revenue Bonds (Buckner Retirement Services, Inc. Obligated
Group Project), Series 1998, 5.250%, 11/15/19
4,000,000 Tarrant County Health Facilities Development Corporation, 1/08 at 105 AAA 4,446,520
Tax-Exempt Mortgage Revenue Bonds (South Central Nursing Homes,
Inc. Project), Series 1997A, 6.000%, 1/01/37
- ------------------------------------------------------------------------------------------------------------------------------------
Tax Obligation/General - 11.3%
1,000,000 Caddo Mills Independent School District (Hunt County, Texas), 2/05 at 100 AAA 1,114,180
Unlimited Tax School Building and Refunding Bonds, Series 1995,
6.375%, 8/15/25
4,130,000 Coppell Independent School District (Dallas County, Texas), 8/09 at 75 11/32 AAA 1,893,812
Unlimited Tax School Building and Refunding Bonds, Series 1992,
0.000%, 8/15/14
1,475,000 City of Corpus Christi, Texas, General Improvement and Refunding 3/02 at 100 AAA 1,606,128
Bonds, Series 1992, 6.700%, 3/01/08
2,800,000 City of Ennis, Texas (Ennis County), General Obligation Refunding 8/02 at 100 AAA 3,045,448
and Improvement Bonds, Series 1992, 6.500%, 8/01/13
1,545,000 Montgomery County (A political subdivision of the State of Texas), 9/07 at 72 3/8 AAA 739,808
Refunding Bonds, Series 1997, 0.000%, 3/01/14
1,825,000 Socorro Independent School District (El Pasco, County, Texas), 2/06 at 100 Aaa 1,930,339
Unlimited Tax School Building Bonds, Series 1996, 5.750%, 2/15/21
2,000,000 State of Texas, Veterans Land Bonds, Series 1994, General 12/04 at 100 AA 2,181,820
Obligation Bonds, 6.400%, 12/01/24 (Alternative Minimum Tax)
3,885,000 State of Texas, Veterans Housing Assistance Bonds, Series 1993, 12/03 at 102 AA 4,194,285
General Obligation Bonds, 6.800%, 12/01/23 (Alternative Minimum Tax)
6,290,000 State of Texas, College Student Loan Bonds, Series 1997, 8/10 at 100 AA 6,083,185
5.000%, 8/01/22 (Alternative Minimum Tax)
1,225,000 Weslaco Independent School District, (Hidalgo County, Texas), 2/06 at 100 Aaa 1,313,261
Unlimited Tax School Building and Refunding Bonds, Series 1996,
5.700%, 2/15/15
<PAGE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Tax Obligation/General (continued)
West Independent School District (McLennan and Hill Counties,
Texas), Unlimited Tax School Building and Refunding Bonds,
Series 1998:
$ 1,000,000 0.000%, 8/15/22 8/13 at 61 7/32 AAA $ 290,900
1,000,000 0.000%, 8/15/23 8/13 at 57 31/32 AAA 275,460
1,000,000 0.000%, 8/15/24 8/13 at 54 7/8 AAA 260,830
- ------------------------------------------------------------------------------------------------------------------------------------
Tax Obligation/Limited - 6.0%
4,035,000 City of Bryan, Texas (Brazos County), Lease Revenue Bonds 10/05 at 100 AAA 4,160,569
(Blinn College Project), Series 1995, 5.300%, 10/01/16
1,450,000 Industrial Development Corporation of the City of Galveston, 9/05 at 100 AAA 1,576,832
Sales Tax Revenue Bonds, Series 1995,5.750%, 9/01/15
1,575,000 Harris County, Texas, Toll Road Unlimited Tax and Subordinate Lien 8/02 at 102 AA 1,736,501
Revenue Refunding Bonds, Series 1992A, 6.500%, 8/15/15
800,000 City of Laredo, Texas (Webb County), Combination Tax and 8/04 at 100 AAA 863,440
Waterworks System, Revenue Certificates of Obligation, Series 1994,
5.625%, 8/15/11
4,580,000 City of San Antonio, Texas, Hotel Occupancy Tax Revenue Bonds 8/06 at 102 AAA 4,909,577
(Henry B. Gonzalez Convention Center Project), 5.700%, 8/15/26
- ------------------------------------------------------------------------------------------------------------------------------------
Transportation - 11.0%
5,295,000 Alliance Airport Authority, Inc., Special Facilities Revenue Bonds, 12/00 at 102 Baa2 5,680,688
Series 1990 (American Airlines, Inc. Project), 7.500%, 12/01/29
(Alternative Minimum Tax)
5,020,000 Dallas-Fort Worth International Airport, Facility Improvement 5/02 at 102 AAA 5,477,573
Corporation, United Parcel Service, Inc. Revenue Bonds,
Series 1992, 6.600%, 5/01/32 (Alternative Minimum Tax)
3,600,000 Harris County, Texas, Toll Road Senior Lien, Revenue Refunding Bonds, 8/04 at 102 AAA 3,710,124
Series 1994, 5.375%, 8/15/20
220,000 Harris County, Texas, Toll Road Senior Lien Revenue Refunding Bonds, 8/02 at 102 AAA 242,944
Series 1992A, 6.500%, 8/15/17
320,000 Harris County, Texas, Toll Road Senior Lien Revenue Refunding Bonds, 2/99 at 101 AAA 324,080
Series 1992B, 6.625%, 8/15/17
5,000,000 City of Houston, Texas, Airport System Subordinate Lien Revenue 7/01 at 102 AAA 5,410,550
Bonds, Series 1991A, 6.750%, 7/01/21 (Alternative Minimum Tax)
3,300,000 City of Houston, Texas, Airport System Special Facilities Revenue 7/07 at 100 AAA 3,443,847
Bonds (Automated People Mover Project), Series 1997A,
5.500%, 7/15/17 (Alternative Minimum Tax)
- ------------------------------------------------------------------------------------------------------------------------------------
U.S. Guaranteed - 19.5%
4,500,000 Amarillo Health Facilities Corporation, Hospital Revenue Bonds 1/02 at 102 AAA 4,953,735
(High Plains Baptist Hospital Project), Series 1992C,
6.500%, 1/01/07 (Pre-refunded to 1/01/02)
3,500,000 City of Austin, Texas, Combined Utility Systems Revenue Refunding 5/01 at 102 A*** 3,824,520
Bonds, Series 1991, 6.750%, 5/15/12 (Pre-refunded to 5/15/01)
1,000,000 The City of Beaumont, Texas, Public Improvement Bonds, 3/02 at 100 AAA 1,081,090
Series 1992, 6.250%, 3/01/10 (Pre-refunded to 3/01/02)
2,000,000 City of Brownsville, Texas, General Obligation Refunding Bonds, 2/01 at 100 AAA 2,136,120
Series 1991, 6.750%, 2/15/12 (Pre-refunded to 2/15/01)
3,500,000 City of Brownsville, Texas, Utilities System Priority Revenue Bonds, 9/00 at 102 AAA 3,749,550
Series 1990, 6.500%, 9/01/17 (Pre-refunded to 9/01/00)
1,975,000 City of Corpus Christi, Texas, General Improvement and 3/02 at 100 AAA 2,160,986
Refunding Bonds, Series 1992, 6.700%, 3/01/08
(Pre-refunded to 3/01/02)
1,500,000 City of Dallas, Texas (Dallas, Denton and Collin Counties), 1/02 at 100 AAA 1,615,965
Combination Tax and Surplus Revenue, Certificates of Obligation,
Series 1992, 6.250%, 1/01/20 (Pre-refunded to 1/01/02)
1,185,000 Fort Bend County Levee Improvement District No. 11 (A Political 9/04 at 100 AAA 1,378,392
Subdivision of the State of Texas, located within Fort Bend County),
Unlimited Tax Levee Improvement Bonds, Series 1994,
6.900%, 9/01/17 (Pre-refunded to 9/01/04)
1,780,000 Harris County, Texas, Toll Road Senior Lien Revenue Refunding 8/02 at 102 AAA 1,990,218
Bonds, Series 1992A, 6.500%, 8/15/17 (Pre-refunded to 8/15/02)
425,000 Harris County, Texas, Toll Road Unlimited Tax and Subordinate 8/02 at 102 AA*** 474,436
Lien Revenue Refunding Bonds, Series 1992, 6.500%, 8/15/15
(Pre-refunded to 8/15/02)
<PAGE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
U.S. Guaranteed (continued)
$ 4,000,000 Harris County Health Facilities Development Corporation, Hospital 10/99 at 102 AAA $4,186,640
Revenue Bonds (Texas Children's Hospital Project), Series 1989A,
7.000%, 10/01/19 (Pre-refunded to 10/01/99)
6,110,000 Harris County Health Facilities Development Corporation, Hospital 6/02 at 102 A3*** 6,901,428
Revenue Bonds (Memorial Hospital System Project), Series 1992,
7.125%, 6/01/15 (Pre-refunded to 6/01/02)
250,000 City of Houston, Texas, Water and Sewer System, Junior Lien 12/01 at 102 AAA 275,248
Revenue Refunding Bonds, Series 1991C, 6.375%, 12/01/17
(Pre-refunded to 12/01/01)
North Central Texas Health Facilities Development Corporation,
Hospital Revenue Bonds (Presbyterian Healthcare System Project),
Series 1996B:
1,000,000 5.500%, 6/01/21 6/06 at 102 AAA 1,078,530
1,000,000 5.750%, 6/01/26 No Opt. Call AAA 1,108,380
2,500,000 Ratama Development Corporation, Special Facilities Revenue Bonds No Opt. Call AAA 3,704,625
(Retama Park Racetrack Project), Series 1993, 8.750%, 12/15/17
City of San Antonio, Texas, Water System Revenue Refunding Bonds,
Series 1992:
1,310,000 6.500%, 5/15/10 (Pre-refunded to 5/15/02) 5/02 at 102 AAA 1,456,091
665,000 6.500%, 5/15/10 No Opt. Call Aaa 795,027
- ------------------------------------------------------------------------------------------------------------------------------------
Utilities - 5.5%
1,225,000 Brazos River Authority (Texas), Collateralized Pollution Control 2/00 at 102 BBB+ 1,291,015
Revenue Bonds (Texas Utilities Electric Company Project),
Series 1990A, 8.125%, 2/01/20 (Alternative Minimum Tax)
2,000,000 Brazos River Authority (Texas), Collateralized Pollution Control Revenue 3/01 at 102 BBB+ 2,160,820
Bonds (Texas Utilities Electric Company Project), Series 1994A,
7.875%, 3/01/21 (Alternative Minimum Tax)
1,500,000 Brazos River Authority (Texas), Collateralized Pollution Control Revenue 12/02 at 102 AAA 1,654,785
Refunding Bonds (Texas Utilities Electric Company Project),
Series 1992, 6.500%, 12/01/27 (Alternative Minimum Tax)
4,000,000 Brazos River Authority (Texas), Pollution Control Revenue Refunding 5/08 at 102 AAA 4,185,880
Bonds (Texas Utilities Electric Company Project), Series 1998A,
5.550%, 5/01/33 (Alternative Minimum Tax)
1,200,000 Brazos River Authority (Texas), Collateralized Revenue Refunding 12/03 at 102 AAA 1,260,528
Bonds (Houston Lighting and Power Company Project),
Series 1993, 5.600%, 12/01/17
1,500,000 Matagorda County Navigation District Number One (Texas), 7/03 at 102 A- 1,571,819
Pollution Control Revenue Refunding Bonds (Central Power and
Light Company Project), Series 1993, 6.000%, 7/01/28
- ------------------------------------------------------------------------------------------------------------------------------------
Water and Sewer - 3.6%
1,000,000 City of Houston, Texas, Water and Sewer System, Prior Lien 12/02 at 102 A 1,091,299
Revenue Refunding Bonds, Series 1992B, 6.375%, 12/01/14
3,750,000 City of Houston, Texas, Water and Sewer System, Junior Lien 12/01 at 102 AAA 4,067,812
Revenue Refunding Bonds, Series 1991C, 6.375%, 12/01/17
2,525,000 City of San Antonio, Texas, Water System Revenue Refunding Bonds,
Series 1992, 6.500%, 5/15/10 5/02 at 102 AAA 2,775,782
- ------------------------------------------------------------------------------------------------------------------------------------
$ 211,595,000 Total Investments - (cost $200,912,312) - 98.7% 217,267,373
=============
Temporary Investments in Short-Term Municipal Securities - 0.5%
$ 1,000,000 Harris Co. Pollution Control Revenue (Exxon), Variable Rate Demand A-1+ 1,000,000
============= Bonds, 3.100%, 3/01/24+
Other Assets Less Liabilities - 0.8% 1,772,300
--------------------------------------------------------------------------------------------------------------------
Net Assets - 100% $220,039,673
====================================================================================================================
* Optional Call Provisions: Dates (month and year) and prices of the earliest
optional call or redemption. There may be other call provisions at varying
prices at later dates.
** Ratings: Using the higher of Standard & Poor's or Moody's rating.
*** Securities are backed by an escrow or trust containing sufficient U.S.
government or U.S. government agency securities which ensures the timely
payment of principal and interest. Securities are normally considered to be
equivalent to AAA rated securities.
N/R Investment is not rated.
+ The security has a maturity of more than one year, but has variable rate
and demand features which qualify it as a short-term security. The rate
disclosed is that currently in effect. This rate changes periodically based
on market conditions or a specified market index.
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
Statement of Net Assets
January 31, 1999
(Unaudited)
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
Arizona Michigan Michigan Ohio Texas
Premium Quality Premium Quality Quality
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Assets
Investments in municipal securities, at market
value (note 1) $98,059,925 $260,060,973 $173,018,693 $232,813,812 $217,267,373
Temporary investments in short-term municipal
securities, at amortized cost, which approximates
market value (note 1) -- 1,500,000 800,000 1,000,000 1,000,000
Cash -- 412,184 2,543,739 -- --
Receivables:
Interest 727,211 3,802,720 2,086,473 2,674,785 3,388,956
Investments sold 25,051 -- -- 2,402,016 1,086,805
Other assets 609 407 5,077 8,422 3,178
- ------------------------------------------------------------------------------------------------------------------------------------
Total assets 98,812,796 265,776,284 178,453,982 238,899,035 222,746,312
- ------------------------------------------------------------------------------------------------------------------------------------
Liabilities
Cash overdraft 270,783 -- -- 67,844 1,747,565
Payable for investments purchased -- 973,510 1,947,020 1,526,484 --
Accrued expenses:
Management fees (note 6) 53,933 143,348 96,088 128,762 119,975
Other 57,416 92,743 134,535 153,933 110,525
Preferred share dividends payable 4,932 13,811 14,644 19,367 21,815
Common share dividends payable 298,761 875,106 522,562 770,085 706,759
- ------------------------------------------------------------------------------------------------------------------------------------
Total liabilities 685,825 2,098,518 2,714,849 2,666,475 2,706,639
- ------------------------------------------------------------------------------------------------------------------------------------
Net assets (note 7) $98,126,971 $263,677,766 $175,739,133 $236,232,560 $220,039,673
====================================================================================================================================
Preferred shares, at liquidation value $30,000,000 $ 80,000,000 $ 56,000,000 $ 77,000,000 $ 69,000,000
====================================================================================================================================
Preferred shares outstanding 1,200 3,200 2,240 3,080 2,760
====================================================================================================================================
Common shares outstanding 4,330,412 11,439,907 7,684,941 9,391,828 9,424,067
====================================================================================================================================
Net asset value per Common share outstanding
(net assets less Preferred shares
at liquidation value,
divided by Common shares outstanding) $ 15.73 $ 16.06 $ 15.58 $ 16.95 $ 16.03
====================================================================================================================================
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
Statement of Operations
Six Months Ended January 31, 1999
(Unaudited)
- ------------------------------------------------------------------------------------------------------------------------------------
Arizona Michigan Michigan Ohio Texas
Premium Quality Premium Quality Quality
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Investment Income (note 1) $2,708,108 $7,632,480 $4,763,432 $6,695,347 $6,387,690
- ------------------------------------------------------------------------------------------------------------------------------------
Expenses
Management fees (note 6) 319,749 852,860 570,626 763,476 714,823
Preferred shares - auction fees 37,808 100,823 70,575 97,042 86,958
Preferred shares - dividend disbursing agent fees 5,042 5,042 10,081 15,123 10,081
Shareholders' servicing agent fees and expenses 3,902 17,638 12,874 18,942 9,248
Custodian's fees and expenses 18,628 27,331 22,625 27,328 25,758
Directors'/Trustees' fees and expenses (note 6) 462 1,253 830 1,115 1,051
Professional fees 8,688 8,926 8,795 8,882 8,867
Shareholders' reports - printing and mailing expenses 15,137 39,095 28,769 32,004 24,450
Stock exchange listing fees 8,151 12,413 8,151 8,256 8,162
Investor relations expense 3,916 11,476 7,886 10,494 8,366
Other expenses 4,354 10,404 7,325 9,761 9,221
- ------------------------------------------------------------------------------------------------------------------------------------
Total expenses 425,837 1,087,261 748,537 992,423 906,985
- ------------------------------------------------------------------------------------------------------------------------------------
Net investment income 2,282,271 6,545,219 4,014,895 5,702,924 5,480,705
- ------------------------------------------------------------------------------------------------------------------------------------
Realized and Unrealized Gain from Investments
Net realized gain from investment transactions
(notes 1 and 4) 56,254 588,191 450,523 46,982 987,737
Net change in unrealized appreciation or depreciation
of investments 1,210,888 1,738,374 1,653,663 2,789,083 882,138
- ------------------------------------------------------------------------------------------------------------------------------------
Net gain from investments 1,267,142 2,326,565 2,104,186 2,836,065 1,869,875
- ------------------------------------------------------------------------------------------------------------------------------------
Net increase in net assets from operations $3,549,413 $8,871,784 $6,119,081 $8,538,989 $7,350,580
====================================================================================================================================
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
Statement of Changes in Net Assets
(Unaudited)
<CAPTION>
Arizona Premium Michigan Quality Michigan Premium
--------------------------------- ---------------------------------- ------------------------------
Six Months Ended Year Ended Six Months Ended Year Ended Six Months Ended Year Ended
1/31/99 7/31/98 1/31/99 7/31/98 1/31/99 7/31/98
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Operations
Net investment income $ 2,282,271 $ 4,519,847 $ 6,545,219 $ 13,246,845 $ 4,014,895 $ 8,001,062
Net realized gain from investment
transactions (notes 1 and 4) 56,254 469,613 588,191 444,027 450,523 134,148
Net change in unrealized appreciation
or depreciation of investments 1,210,888 (84,432) 1,738,374 (591,805) 1,653,663 1,238,827
- -----------------------------------------------------------------------------------------------------------------------------------
Net increase in net assets
from operations 3,549,413 4,905,028 8,871,784 13,099,067 6,119,081 9,374,037
- -----------------------------------------------------------------------------------------------------------------------------------
Distributions to Shareholders (note 1)
From undistributed net investment income:
Common shareholders (1,789,943) (3,560,162) (5,291,240) (10,831,644) (3,133,238) (6,264,993)
Preferred shareholders (459,235) (1,004,753) (1,168,604) (2,682,487) (811,236) (1,933,132)
From accumulated net realized gains
from investment transactions:
Common shareholders -- -- (698,100) (111,138) -- --
Preferred shareholders -- -- (125,248) (27,488) -- --
- -----------------------------------------------------------------------------------------------------------------------------------
Decrease in net assets from
distributions to shareholders (2,249,178) (4,564,915) (7,283,192) (13,652,757) (3,944,474) (8,198,125)
- -----------------------------------------------------------------------------------------------------------------------------------
Capital Share Transactions (note 2)
Net proceeds from Common shares
issued to shareholders due to
reinvestment of distributions 280,712 474,596 829,926 1,566,072 113,808 --
- -----------------------------------------------------------------------------------------------------------------------------------
Net increase in net assets 1,580,947 814,709 2,418,518 1,012,382 2,288,415 1,175,912
Net assets at beginning of period 96,546,024 95,731,315 261,259,248 260,246,866 173,450,718 172,274,806
- -----------------------------------------------------------------------------------------------------------------------------------
Net assets at end of period $98,126,971 $96,546,024 $263,677,766 $261,259,248 $175,739,133 $173,450,718
===================================================================================================================================
Balance of undistributed net
investment income at
end of period $ 244,740 $ 211,647 $ 266,727 $ 181,352 $ 376,969 $ 306,548
===================================================================================================================================
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
Statement of Changes in Net Assets (continued)
(Unaudited)
<CAPTION>
Ohio Quality Texas Quality
- ----------------------------------------------------------------------------------------------------------------------------------
Six Months Ended Year Ended Six Months Ended Year Ended
1/31/99 7/31/98 1/31/99 7/31/98
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Operations
Net investment income $ 5,702,924 $ 11,399,092 $ 5,480,705 $ 11,041,192
Net realized gain from investment transactions
(notes 1 and 4) 46,982 295,006 987,737 905,750
Net change in unrealized appreciation or
depreciation of investments 2,789,083 471,590 882,138 (363,610)
- ----------------------------------------------------------------------------------------------------------------------------------
Net increase in net assets from operations 8,538,989 12,165,688 7,350,580 11,583,332
- ----------------------------------------------------------------------------------------------------------------------------------
Distributions to Shareholders (note 1)
From undistributed net investment income:
Common shareholders (4,615,363) (9,077,395) (4,236,412) (8,716,618)
Preferred shareholders (1,142,618) (2,397,864) (1,042,551) (2,498,267)
From accumulated net realized gains from
investment transactions:
Common shareholders -- -- (701,466) --
Preferred shareholders -- -- (203,285) --
- ----------------------------------------------------------------------------------------------------------------------------------
Decrease in net assets from distributions to shareholders (5,757,981) (11,475,259) (6,183,714) (11,214,885)
- ----------------------------------------------------------------------------------------------------------------------------------
Capital Share Transactions (note 2)
Net proceeds from Common shares issued
to shareholders due to
reinvestment of distributions 511,146 1,018,376 203,691 301,838
- -----------------------------------------------------------------------------------------------------------------------------------
Net increase in net assets 3,292,154 1,708,805 1,370,557 670,285
Net assets at beginning of period 232,940,406 231,231,601 218,669,116 217,998,831
- ----------------------------------------------------------------------------------------------------------------------------------
Net assets at end of period $236,232,560 $232,940,406 $220,039,673 $218,669,116
- ----------------------------------------------------------------------------------------------------------------------------------
Balance of undistributed net investment
income at end of period $ 581,871 $ 636,928 $ 301,404 $ 99,662
==================================================================================================================================
</TABLE>
<PAGE>
Notes to Financial Statements
(Unaudited)
1. General Information and Significant Accounting Policies
The state Funds (the "Funds") covered in this report and their corresponding
New York Stock Exchange symbols are Nuveen Arizona Premium Income Municipal
Fund, Inc. (NAZ), Nuveen Michigan Quality Income Municipal Fund, Inc. (NUM),
Nuveen Michigan Premium Income Municipal Fund, Inc. (NMP), Nuveen Ohio Quality
Income Municipal Fund, Inc. (NUO) and Nuveen Texas Quality Income Municipal
Fund (NTX).
Each Fund invests primarily in a diversified portfolio of municipal obligations
issued by state and local government authorities within a single state. The
Funds are registered under the Investment Company Act of 1940 as closed-end,
diversified management investment companies.
The following is a summary of significant accounting policies followed by the
Funds in the preparation of their financial statements in accordance with
generally accepted accounting principles.
Securities Valuation
The prices of municipal bonds in each Fund's investment portfolio are provided
by a pricing service approved by the Fund's Board of Directors/Trustees. When
price quotes are not readily available (which is usually the case for municipal
securities), the pricing service establishes fair market value based on yields
or prices of municipal bonds of comparable quality, type of issue, coupon,
maturity and rating, indications of value from securities dealers and general
market conditions. Temporary investments in securities that have variable rate
and demand features qualifying them as short-term securities are valued at
amortized cost, which approximates market value.
Securities Transactions
Securities transactions are recorded on a trade date basis. Realized gains and
losses from such transactions are determined on the specific identification
method. Securities purchased or sold on a when-issued or delayed delivery basis
may have extended settlement periods. The securities so purchased are subject to
market fluctuation during this period. The Funds have instructed the custodian
to segregate assets in a separate account with a current value at least equal to
the amount of the when-issued and delayed delivery purchase commitments. At
January 31, 1999, Michigan Quality and Michigan Premium had outstanding
when-issued purchase commitments of $973,510 and $1,947,020, respectively.
Investment Income
Interest income is determined on the basis of interest accrued, adjusted for
amortization of premiums and accretion of discounts on long-term debt securities
when required for federal income tax purposes.
Income Taxes
Each Fund is a separate taxpayer for federal income tax purposes. Each Fund
intends to comply with the requirements of the Internal Revenue Code applicable
to regulated investment companies and to distribute all of its tax-exempt net
investment income, in addition to any significant amounts of net realized
capital gains and/or market discount realized from investment transactions. The
Funds currently consider significant net realized capital gains and/or market
discount as amounts in excess of $.01 per Common share. Furthermore, each Fund
intends to satisfy conditions which will enable interest from municipal
securities, which is exempt from regular federal and designated state income
taxes, to retain such tax-exempt status when distributed to shareholders of the
Funds. Net realized capital gain and market discount distributions are subject
to federal taxation.
Dividends and Distributions to Shareholders
Tax-exempt net investment income is declared as a dividend monthly and payment
is made or reinvestment is credited to shareholder accounts after month-end. Net
realized capital gains and/or market discount from investment transactions, if
any, are distributed to shareholders not less frequently than annually.
Furthermore, capital gains are distributed only to the extent they exceed
available capital loss carryforwards.
Distributions to shareholders of tax-exempt net investment income, net realized
capital gains and/or market discount are recorded on the ex-dividend date. The
amount and timing of distributions are determined in accordance with federal
income tax regulations, which may differ from generally accepted accounting
principles. Accordingly, temporary over-distributions as a result of these
differences may occur and will be classified as either distributions in excess
of net investment income, distributions in excess of net realized gains and/or
distributions in excess of net ordinary taxable income from investment
transactions, where applicable.
<PAGE>
Preferred Shares
The Funds have issued and outstanding $25,000 stated value Preferred shares.
Each Fund's Preferred shares are issued in one or more Series. The dividend rate
on each Series may change every seven days, as set by the auction agent. The
number of shares outstanding, by Series and in total, for each Fund is as
follows:
<TABLE>
<CAPTION>
Arizona Michigan Michigan Ohio Texas
Premium Quality Premium Quality Quality
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Number of shares:
Series M -- -- 840 680 760
Series Th 1,200 3,200 1,400 1,400 2,000
Series Th2 -- -- -- 1,000 --
- ---------------------------------------------------------------------------------------------------------
Total 1,200 3,200 2,240 3,080 2,760
=========================================================================================================
</TABLE>
Derivative Financial Instruments
The Funds may invest in transactions in certain derivative financial instruments
including futures, forward, swap, and option contracts, and other financial
instruments with similar characteristics. Although the Funds are authorized to
invest in such financial instruments, and may do so in the future, they did not
make any such investments during the six months ended January 31, 1999.
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 increases and decreases in net
assets from operations during the reporting period. Actual results may differ
from those estimates.
2. Fund Shares
Transactions in Common shares were as follows:
<TABLE>
<CAPTION>
Arizona Premium Michigan Quality
- ---------------------------------------------------------------------------------------------------------------
Six Months Ended Year Ended Six Months Ended Year Ended
1/31/99 7/31/98 1/31/99 7/31/98
- ---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares issued to shareholders
due to reinvestment of distributions 16,792 29,905 48,815 93,557
===============================================================================================================
Michigan Premium Ohio Quality
- ---------------------------------------------------------------------------------------------------------------
Six Months Ended Year Ended Six Months Ended Year Ended
1/31/99 7/31/98 1/31/99 7/31/98
- ---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares issued to shareholders
due to reinvestment of distributions 7,255 -- 27,109 57,107
===============================================================================================================
Texas Quality
- ---------------------------------------------------------------------------------------------------------------
Six Months Ended Year Ended
1/31/99 7/31/98
- ---------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Shares issued to shareholders
due to reinvestment of distributions 12,632 19,003
===============================================================================================================
</TABLE>
3. Distributions to Common Shareholders
The Funds declared Common share dividend distributions from their tax-exempt net
investment income which were paid March 1, 1999, to shareholders of record on
February 15, 1999, as follows:
<TABLE>
<CAPTION>
Arizona Michigan Michigan Ohio Texas
Premium Quality Premium Quality Quality
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Dividend per share $.0705 $.0765 $.0690 $.0820 $.0750
=========================================================================================================
</TABLE>
<PAGE>
4. Securities Transactions
Purchases and sales (including maturities) of investments in municipal
securities and temporary municipal investments during the six months ended
January 31, 1999, were as follows:
<TABLE>
<CAPTION>
Arizona Michigan Michigan Ohio Texas
Premium Quality Premium Quality Quality
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Purchases:
Investments in municipal securities $2,703,900 $20,606,341 $7,697,915 $5,550,430 $30,511,625
Temporary municipal investments 2,000,000 8,300,000 3,900,000 8,700,000 6,800,000
Sales and Maturities:
Investments in municipal securities 1,107,400 20,639,479 7,698,985 4,292,770 29,352,973
Temporary municipal investments 2,000,000 6,800,000 4,200,000 8,400,000 7,300,000
=========================================================================================================
</TABLE>
At January 31, 1999, the identified cost of investments owned for federal income
tax purposes was the same as the cost for financial reporting purposes for
each Fund.
At January 31, 1999, the Funds' last fiscal year end, the following Funds had
unused capital loss carryforwards available for federal income tax purposes to
be applied against future capital gains, if any. If not applied, the
carryforwards will expire as follows:
<TABLE>
<CAPTION>
Arizona Michigan Ohio
Premium Premium Quality
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Expiration year:
2002 $ -- $ 154,548 $ 856,869
2003 846,663 627,148 16,493
2004 -- 1,807,234 622,243
- ---------------------------------------------------------------------------------------------------------
Total $846,663 $2,588,930 $1,495,605
=========================================================================================================
</TABLE>
5. Unrealized Appreciation (Depreciation)
Gross unrealized appreciation and gross unrealized depreciation of investments
at January 31, 1999, were as follows:
<TABLE>
<CAPTION>
Arizona Michigan Michigan Ohio Texas
Premium Quality Premium Quality Quality
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Gross unrealized:
appreciation $8,737,473 $23,614,955 $14,154,386 $18,290,571 $16,495,649
depreciation (73,084) (244,039) (78,991) (1,020) (140,588)
- ---------------------------------------------------------------------------------------------------------
Net unrealized appreciation $8,664,389 $23,370,916 $14,075,395 $18,289,551 $16,355,061
=========================================================================================================
</TABLE>
<PAGE>
6. Management Fee and Other Transactions with Affiliates
Under the Funds' investment management agreements with Nuveen Advisory Corp.
(the "Adviser"), a wholly owned subsidiary of The John Nuveen Company, each Fund
pays an annual management fee, payable monthly, at the rates set forth below,
which are based upon the average daily net asset value of each Fund as follows:
Average Daily Net Asset Value Management Fee
- -------------------------------------------------------------------------------
For the first $125 million .6500 of 1%
For the next $125 million .6375 of 1
For the next $250 million .6250 of 1
For the next $500 million .6125 of 1
For the next $1 billion .6000 of 1
For net assets over $2 billion .5875 of 1
===============================================================================
The fee compensates the Adviser for overall investment advisory and
administrative services and general office facilities. The Funds pay no
compensation directly to those of its Directors/Trustees who are affiliated with
the Adviser or to their officers, all of whom receive remuneration for their
services to the Funds from the Adviser.
7. Composition of Net Assets At January 31, 1999, net assets consisted of:
<TABLE>
<CAPTION>
Arizona Michigan Michigan
Premium Quality Premium
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Preferred shares, $25,000 stated value per share,
at liquidation value $30,000,000 $ 80,000,000 $ 56,000,000
Common shares, $.01 par value per share 43,304 114,399 76,849
Paid-in surplus 59,964,947 159,792,798 107,348,327
Balance of undistributed net investment income 244,740 266,727 376,969
Accumulated net realized gain (loss)
from investment transactions (790,409) 132,926 (2,138,407)
Net unrealized appreciation of investments 8,664,389 23,370,916 14,075,395
- ---------------------------------------------------------------------------------------------------------
Net assets $98,126,971 $263,677,766 $175,739,133
=========================================================================================================
Authorized shares:
Common 200,000,000 200,000,000 200,000,000
Preferred 1,000,000 1,000,000 1,000,000
=========================================================================================================
<CAPTION>
Ohio Texas
Quality Quality
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C>
Preferred shares, $25,000 stated value per share,
at liquidation value $ 77,000,000 $ 69,000,000
Common shares, $.01 par value per share 93,918 94,241
Paid-in surplus 141,728,411 133,508,367
Balance of undistributed net investment income 581,871 301,404
Accumulated net realized gain (loss) from investment transactions (1,461,191) 780,600
Net unrealized appreciation of investments 18,289,551 16,355,061
- ---------------------------------------------------------------------------------------------------------
Net assets $236,232,560 $220,039,673
=========================================================================================================
Authorized shares:
Common 200,000,000 Unlimited
Preferred 1,000,000 Unlimited
=========================================================================================================
</TABLE>
<PAGE>
<TABLE>
Financial Highlights
(Unaudited)
Selected data for a Common share outstanding throughout each
period is as follows:
<CAPTION>
Investment Operations
----------------------------------------
Net
Realized/
Beginning Net Unrealized
Net Asset Investment Investment
Value Income Gain (Loss) Total
<S> <C> <C> <C> <C>
Arizona Premium
Year Ended 7/31:
1999 (a) $15.43 $ .53 $ .29 $ .82
1998 15.34 1.05 .10 1.15
1997 14.51 1.06 .81 1.87
1996 14.12 1.05 .38 1.43
1995 13.61 1.07 .49 1.56
1994 14.49 1.07 (.84) .23
<CAPTION>
Michigan Quality
<S> <C> <C> <C> <C>
Year Ended 7/31:
1999 (a) 15.91 .57 .21 .78
1998 15.95 1.17 (.01) 1.16
1997 15.28 1.18 .72 1.90
1996 15.10 1.19 .27 1.46
1995 15.02 1.21 .19 1.40
1994 15.85 1.21 (.82) .39
<CAPTION>
Michigan Premium
<S> <C> <C> <C> <C>
Year Ended 7/31:
1999 (a) 15.30 .52 .28 .80
1998 15.14 1.04 .19 1.23
1997 14.16 1.05 .97 2.02
1996 13.73 1.05 .41 1.46
1995 13.46 1.04 .31 1.35
1994 14.47 1.03 (1.01) .02
<CAPTION>
Ohio Quality
<S> <C> <C> <C> <C>
Year Ended 7/31:
1999 (a) 16.65 .61 .30 .91
1998 16.57 1.22 .09 1.31
1997 15.69 1.23 .88 2.11
1996 15.33 1.23 .35 1.58
1995 14.84 1.22 .52 1.74
1994 15.72 1.19 (.82) .37
<CAPTION>
Texas Quality
<S> <C> <C> <C> <C>
Year Ended 7/31:
1999 (a) 15.90 .58 .20 .78
1998 15.86 1.17 .07 1.24
1997 15.06 1.19 .81 2.00
1996 14.91 1.21 .21 1.42
1995 14.53 1.22 .42 1.64
1994 15.41 1.21 (.83) .38
<PAGE>
<CAPTION>
Less Distributions
------------------------------------------------------------------------------
Net Net
Investment Investment Capital Capital
Income Income Gains Gains
To Common To Preferred To Common To Preferred
Shareholders Shareholders+ Shareholders Shareholders+ Total
<S> <C> <C> <C> <C> <C>
Arizona Premium
Year Ended 7/31:
1999 (a) $ (.41) $(.11) $-- $-- $ (.52)
1998 (.83) (.23) -- -- (1.06)
1997 (.82) (.22) -- -- (1.04)
1996 (.80) (.24) -- -- (1.04)
1995 (.78) (.27) -- -- (1.05)
1994 (.79) (.26) (.05) (.01) (1.11)
<CAPTION>
Michigan Quality
<S> <C> <C> <C> <C> <C>
Year Ended 7/31:
1999 (a) (.46) (.10) (.06) (.01) (.63)
1998 (.95) (.24) (.01) -- (1.20)
1997 (.95) (.24) (.03) (.01) (1.23)
1996 (.95) (.24) (.07) (.02) (1.28)
1995 (1.00) (.26) (.05) (.01) (1.32)
1994 (1.05) (.17) -- -- (1.22)
<CAPTION>
Michigan Premium
<S> <C> <C> <C> <C> <C>
Year Ended 7/31:
1999 (a) (.41) (.11) -- -- (.52)
1998 (.82) (.25) -- -- (1.07)
1997 (.80) (.24) -- -- (1.04)
1996 (.78) (.25) -- -- (1.03)
1995 (.80) (.28) -- -- (1.08)
1994 (.81) (.17) (.04) (.01) (1.03)
<CAPTION>
Ohio Quality
<S> <C> <C> <C> <C> <C>
Year Ended 7/31:
1999 (a) (.49) (.12) -- -- (.61)
1998 (.97) (.26) -- -- (1.23)
1997 (.96) (.27) -- -- (1.23)
1996 (.95) (.27) -- -- (1.22)
1995 (.95) (.30) -- -- (1.25)
1994 (1.03) (.18) (.03) (.01) (1.25)
<CAPTION>
Texas Quality
<S> <C> <C> <C> <C> <C>
Year Ended 7/31:
1999 (a) (.45) (.11) (.07) (.02) (.65)
1998 (.93) (.27) -- -- (1.20)
1997 (.94) (.26) -- -- (1.20)
1996 (.95) (.27) (.04)+++ (.01)+++ (1.27)
1995 (.98) (.28) -- -- (1.26)
1994 (1.06) (.17) (.03) -- (1.26)
<PAGE>
<CAPTION>
Total Returns
------------------------------
Ending
Net Asset Ending Based on Based on Net
Value Market Value Market Value** Asset Value**
<S> <C> <C> <C> <C>
Arizona Premium
Year Ended 7/31:
1999 (a) $15.73 $16.3125 1.73% 4.66%
1998 15.43 16.4375 12.18 6.14
1997 15.34 15.4375 17.81 11.74
1996 14.51 13.8750 7.83 8.48
1995 14.12 13.6250 10.42 9.98
1994 13.61 13.1250 (11.66) (.43)
<CAPTION>
Michigan Quality
<S> <C> <C> <C> <C>
Year Ended 7/31:
1999 (a) 16.06 16.4375 (2.09) 4.25
1998 15.91 17.3125 10.27 5.97
1997 15.95 16.6250 14.02 11.19
1996 15.28 15.5000 11.32 8.07
1995 15.10 14.8750 4.77 8.02
1994 15.02 15.2500 1.82 1.33
<CAPTION>
Michigan Premium
<S> <C> <C> <C> <C>
Year Ended 7/31:
1999 (a) 15.58 14.7500 .97 4.53
1998 15.30 15.0000 13.74 6.62
1997 15.14 13.9375 14.95 12.97
1996 14.16 12.8750 14.00 8.88
1995 13.73 12.0000 2.59 8.45
1994 13.46 12.5000 (11.43) (1.27)
<CAPTION>
Ohio Quality
<S> <C> <C> <C> <C>
Year Ended 7/31:
1999 (a) 16.95 18.1875 3.34 4.80
1998 16.65 18.0625 10.14 6.53
1997 16.57 17.3125 14.70 12.14
1996 15.69 16.0000 12.39 8.68
1995 15.33 15.1250 6.80 10.16
1994 14.84 15.1250 2.72 1.06
<CAPTION>
Texas Quality
<S> <C> <C> <C> <C>
Year Ended 7/31:
1999 (a) 16.03 15.6875 3.34 4.16
1998 15.90 15.6875 6.45 6.27
1997 15.86 15.6250 11.76 11.93
1996 15.06 14.8750 14.60 7.72
1995 14.91 13.8750 1.14 9.89
1994 14.53 14.7500 (.27) 1.28
<PAGE>
<CAPTION>
Ratios/Supplemental Data
-------------------------------------------------------------------------------------------------
Ratio of Net Ratio of Net
Ratio of Investment Ratio of Investment
Expenses to Income to Expenses to Income to
Average Average Average Total Average Total
Ending Net Assets Net Assets Net Assets Net Assets Portfolio
Net Assets Applicable to Applicable to Including Including Turnover
(000) Common Shares++ Common Shares++ Preferred++ Preferred++ Rate
<S> <C> <C> <C> <C> <C> <C>
Arizona Premium
Year Ended 7/31:
1999 (a) $ 98,127 1.25%* 6.70%* .87%* 4.64%* 1%
1998 96,546 1.28 6.85 .88 4.71 17
1997 95,731 1.29 7.18 .87 4.86 11
1996 92,095 1.33 7.22 .90 4.88 15
1995 90,434 1.30 7.92 .86 5.21 11
1994 88,263 1.25 7.39 .84 4.97 21
Michigan Quality
Year Ended 7/31:
1999 (a) 263,678 1.18* 7.09* .82* 4.93* 8
1998 261,259 1.19 7.35 .82 5.09 8
1997 260,247 1.21 7.64 .83 5.23 11
1996 251,033 1.21 7.77 .83 5.29 15
1995 247,907 1.26 8.26 .84 5.54 18
1994 246,082 1.24 7.71 .85 5.27 4
Michigan Premium
Year Ended 7/31:
1999 (a) 175,739 1.25* 6.69* .85* 4.55* 4
1998 173,451 1.29 6.87 .87 4.64 6
1997 172,275 1.29 7.27 .86 4.83 4
1996 164,688 1.32 7.38 .87 4.87 17
1995 161,414 1.57 7.83 1.01 5.02 32
1994 100,888 1.42 7.23 .94 4.82 17
Ohio Quality
Year Ended 7/31:
1999 (a) 236,233 1.24* 7.15* .84* 4.81* 2
1998 232,940 1.29 7.37 .86 4.92 9
1997 231,232 1.30 7.73 .85 5.08 25
1996 222,151 1.32 7.79 .87 5.09 19
1995 218,335 1.47 8.20 .94 5.24 19
1994 101,335 1.41 7.67 .94 5.09 2
Texas Quality
Year Ended 7/31:
1999 (a) 220,040 1.19* 7.20* .82* 4.94* 14
1998 218,669 1.22 7.40 .83 5.06 17
1997 217,999 1.22 7.81 .83 5.27 13
1996 210,423 1.23 7.95 .83 5.36 17
1995 208,924 1.38 8.35 .91 5.54 8
1994 153,724 1.25 7.93 .86 5.43 10
* Annualized.
** Total Investment Return on Market Value is the combination of reinvested
dividend income, reinvested capital gains distributions, if any, and
changes in stock price per share. Total Return on Net Asset Value is the
combination of reinvested dividend income, reinvested capital gains
distributions, if any, and changes in net asset value per share. Total
returns are not annualized.
+ The amounts shown are based on Common share equivalents.
++ Ratios do not reflect the effect of dividend payments to Preferred
shareholders; income ratios reflect income earned on assets attributable to
Preferred shares.
+++ The amounts shown include distributions in excess of capital gains of $.008
for Common shareholders and $.002 for Preferred shareholders.
(a) For the six months ended January 31, 1999.
</TABLE>
<PAGE>
Building a Better Portfolio Can Make You a Successful Investor
Nuveen Family of Mutual Funds
Nuveen offers a variety of funds designed to help you reach your financial
goals.
Growth
Nuveen Rittenhouse Growth Fund
Growth and Income
European Value Fund
Growth and Income Stock Fund
Balanced Stock and Bond Fund
Balanced Municipal and Stock Fund
Dividend and Growth Fund
Income
Income Fund
Tax-Free Income
National Funds
Long-Term
Insured
Intermediate-Term
Limited-Term
State Funds
Arizona
California
Colorado
Connecticut
Florida
Georgia
Kansas
Kentucky
Louisiana
Maryland
Massachusetts
Michigan
Missouri
New Jersey
New Mexico
New York
North Carolina
Ohio
Pennsylvania
Tennessee
Virginia
Wisconsin
Successful investors know that a well-diversified portfolio - one that balances
different types of investments, levels of risk and tax management - can be the
foundation for building and sustaining wealth. That's why Nuveen offers you and
your financial adviser a wide range of quality investments that can help you
build a better portfolio in the pursuit of your financial goals
Exchange-Traded Funds
Nuveen Exchange-Traded Funds offer investors actively managed portfolios of
investment-grade quality municipal bonds. The fund shares are listed and traded
on the New York and American stock exchanges. Exchange-traded funds provide the
investment convenience, price visibility and liquidity of common stocks.
MuniPreferred(R)
Nuveen MuniPreferred offers investors a AAA rated investment with an attractive
tax-free yield for the cash reserves portion of an investment portfolio.
MuniPreferred shares are backed 2-to-1 by the long-term portfolios of Nuveen
dual-class exchange-traded funds and are available for national as well as a
wide variety of state-specific portfolios.
Mutual Funds
Nuveen offers a family of equity, balanced and municipal bond funds featuring
Premier AdvisersSM including Institutional Capital Corporation, Rittenhouse
Financial Services, and Nuveen Advisory Corp. Each brings a specialized
expertise in a particular investment style or asset class, time-tested
investment strategies and a focus on consistent, long-term performance. With
Nuveen's Premier Adviser funds, you have all the advantages of a family of funds
plus the benefits of specialized investment expertise.
Private Asset Management
Rittenhouse Financial Services and Nuveen Asset Management offer comprehensive,
customized investment management solutions to investors with assets of $250,000
or more to invest. A range of actively managed growth, balanced and municipal
income-oriented portfolios are available, all based upon a disciplined
investment philosophy.
Defined Portfolios
Nuveen Defined Portfolios are fixed portfolios of quality securities that are a
convenient, attractive alternative to purchasing individual securities. They
provide low-cost diversification to reduce risk, while also offering
experienced, professional security selection and surveillance. In addition,
Nuveen Defined Portfolios provide daily liquidity at that day's net asset value
for quick access to your assets.
<PAGE>
Fund Information
Board of Directors/Trustees
Robert P. Bremner
Lawrence H. Brown
Anne E. Impellizzeri
Peter R. Sawers
William J. Schneider
Timothy R. Schwertfeger
Judith M. Stockdale
Fund Manager
Nuveen Advisory Corp.
333 West Wacker Drive
Chicago, IL 60606
Custodian, Transfer Agent
and Shareholder Services
The Chase Manhattan Bank
4 New York Plaza
New York, NY 10004-2413
(800) 257-8787
Legal Counsel
Morgan, Lewis &
Bockius LLP
Washington, D.C.
Independent Auditors
Ernst & Young LLP
Chicago, IL
Year 2000
The concern that computer systems may have problems processing date-related
information in the year 2000 and beyond has challenged businesses and
organizations to thoroughly review all aspects of their operations. We have
undertaken just such an approach at Nuveen in preparation for the millennium.
Over the last 10 years, we have updated or replaced our trading, fund
management, and pricing systems at Nuveen - systems that directly affect our
investors and their financial advisers - to address Year 2000 concerns.
We continue to work closely with our transfer agent, custodian, firms through
whom we buy and sell portfolio securities, and other service partners to monitor
the Year 2000 readiness of their systems, while addressing other remaining
systems issues.
In addition, the Funds hold securities of issuers whose business operations
leave them susceptible to Year 2000 concerns. We seek to evaluate an issuer's
Year 2000 readiness as part of our initial and ongoing research of these
issuers. This is only one of the many factors considered in determining whether
to buy, sell, or continue holding a particular security.
We anticipate that all significant components of our Year 2000 review, repair,
and testing program will be complete by mid-1999. This includes appropriate
industry-wide testing of critical systems and receipt of satisfactory assurances
from critical service providers, vendors, and issuers regarding their Year 2000
readiness. We are also making Year 2000 contingency plans to guide recovery
efforts in the event that, despite our remediation attempts, Year 2000 issues
adversely affect the Funds. Although we cannot give complete assurance at this
time that the steps we take will be sufficient to prevent any problems that
would impact the Nuveen Exchange-Traded Funds, we can assure you that we will
take all reasonable steps to prevent disruption of the services provided by
your Fund.
Each fund intends to repurchase shares of its own common or preferred stock in
the future at such times and in such amounts as is deemed advisable. No shares
were repurchased during the six months ended January 31, 1999. Any future
repurchases will be reported to shareholders in the next annual or semiannual
report.
<PAGE>
Serving Investors for Generations
Photo of: John Nuveen, Sr.
Since our founding in 1898, John Nuveen & Co. has been synonymous with
investments that withstand the test of time. Today we offer a broad range of
quality investments designed for individuals seeking to build and sustain
wealth. In fact, more than 1.3 million investors have trusted Nuveen to help
them pursue their financial goals.
The cornerstone of Nuveen's investment philosophy is a commitment to disciplined
long-term investment strategies focused on providing consistent, attractive
performance over time - with moderated risk. We emphasize quality securities
carefully chosen through in-depth research, and we follow those securities
closely over time to ensure that they continue to meet our exacting standards.
Whether your focus is long-term growth, dependable current income or sustaining
accumulated wealth, Nuveen offers a wide variety of investments and services to
help meet your unique circumstances and financial planning needs. Our equity,
balanced, and tax-free income funds, along with our defined portfolios and
private asset management, can help you build a better, well-diversified
portfolio.
Talk with your financial adviser to learn more about how Nuveen investment
products and services can help you. Or call us at (800) 257-8787 for more
information, including a prospectus where applicable. Please read that
information carefully before investing.
NUVEEN 1898 1998
OUR SECOND CENTURY
helping investors sustain the wealth of a lifetime(tm).
John Nuveen & Co. Incorporated
333 West Wacker Drive
Chicago, IL 60606-1286
www.nuveen.com
FSA-1-1-99
