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TAX-EXEMPT INCOME
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Alliance Municipal
Income Fund II
Semi-Annual Report
March 31, 2000
AllianceCapital [LOGO](R)
The Investment Professional's Choice
<PAGE>
Investment Products Offered
---------------------------
o Are Not FDIC Insured
o May Lose Value
o Are Not Bank Guaranteed
---------------------------
<PAGE>
----------------------
LETTER TO SHAREHOLDERS
----------------------
LETTER TO SHAREHOLDERS
May 16, 2000
Dear Shareholder:
We are pleased to report municipal market activity and investment results for
Alliance Municipal Income Fund II's reporting period ending March 31, 2000.
Investment Objective and Policies
The nine portfolios of Alliance Municipal Income Fund II, by investing
principally in high-yielding, predominantly medium-quality municipal securities,
seek to provide their shareholders with the highest level of income exempt from
Federal and state personal income tax (or, for Florida, that state's intangible
tax) that is available without assuming undue risk. These securities generally
offer current yields above those of higher-quality municipal obligations.
--------------------------------------------------------------------------------
INVESTMENT RESULTS*
Periods Ended March 31, 2000
-------------
Total Returns
-------------
Portfolio 6 Months 12 Months
--------------------------------------------------------------------------------
Arizona 2.04% -0.31%
--------------------------------------------------------------------------------
Florida 0.81% -1.92%
--------------------------------------------------------------------------------
Massachusetts 0.61% -2.73%
--------------------------------------------------------------------------------
Michigan 1.88% -0.28%
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Minnesota 1.88% -0.81%
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New Jersey 0.46% -2.28%
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Ohio 0.33% -2.24%
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Pennsylvania 1.37% -2.63%
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Virginia 1.68% -0.74%
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Lehman Brothers
Municipal
Bond Index 2.12% -0.08%
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----------------------------------------
Lipper Rankings
----------------------------------------
For each state specific Lipper Municipal Debt Funds Average
Period Ended March 31, 2000
Lipper
Lipper Lipper Lipper Rankings
Rankings Rankings Rankings Since
1 Year** 3 Year** 5 Year** Inception**
--------------------------------------------------------------------------------
Arizona 3/39 1/39 1/29 1/22
--------------------------------------------------------------------------------
Florida 23/64 3/61 1/46 2/25
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Massachusetts 37/56 1/53 1/46 1/34
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Michigan 4/48 1/45 1/37 1/31
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Minnesota 9/51 1/48 1/42 2/22
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New Jersey 34/59 2/52 1/41 1/26
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Ohio 28/52 2/49 1/44 4/28
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Pennsylvania 30/60 4/59 1/51 1/35
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Virginia 7/35 1/34 1/29 1/27
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* The Fund's investment results are based on the net asset values of Class A
shares as of March 31, 2000. All fees and expenses related to the
operation of the Fund have been deducted, but no adjustment has been made
for sales charges that may apply
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ALLIANCE MUNICIPAL INCOME FUND II o 1
<PAGE>
----------------------
LETTER TO SHAREHOLDERS
----------------------
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when shares are purchased or redeemed. The Lehman Brothers Municipal Bond
Index is a total return performance benchmark for the long-term,
investment-grade tax-exempt bond market. An investor cannot invest
directly in an index, and its results are not indicative of any specific
investment, including Alliance Municipal Income Fund II.
** Lipper Rankings are based on the Portfolio's return among the returns of
its peer group of funds, as represented by the respective state-specific
Lipper Municipal Debt Funds Average. Funds in the Lipper averages
generally have similar investment objectives to the Fund, although some
may have different investment policies. Fund portfolio inception dates
are: Arizona (6/1/94); Florida (6/25/93); Massachusetts (3/29/94);
Michigan (2/25/94); Minnesota (6/25/93); New Jersey (6/25/93); Ohio
(6/25/93); Pennsylvania (6/25/93); and Virginia (4/29/94). Since inception
Lipper Rankings are from the closest month-end after each Portfolio's
respective inception date. An investor cannot invest directly in an
average, and its results are not indicative of any specific investment,
including Alliance Municipal Income Fund II. Each Portfolio's SEC average
annual total returns can be found on page 6.
Additional performance information can be found on pages 5 - 14.
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Investment Results
Each Portfolio's Class A share total returns at net asset value (NAV) for the
six and 12-month periods ended March 31, 2000 are shown on the previous page
along with the Fund's benchmark, the Lehman Brothers Municipal Bond Index and a
comparison to the portfolio's peer groups, as measured by the Municipal Debt
Funds Average for each state. The Lehman Brothers Municipal Bond Index is a
total return performance benchmark for the long-term, investment-grade
tax-exempt bond market. The Lipper Municipal Debt Funds Average is comprised of
funds with generally similar investment objectives to your Fund's portfolios,
although some may have different investment policies.
For the most part, the Fund outperformed its competitors as reflected in the
Lipper Averages. However, the Fund underperformed its benchmark because the
benchmark is comprised of shorter, more actively traded bonds, while the Fund
tends to focus on longer maturity bonds for specific states.
Market Overview
For the six-month period ended March 31, 2000, municipal bonds continued to
deliver strong after-tax performance versus other fixed-income sectors. Overall
prices in the municipal bond market declined in late 1999 and early 2000, but
have recently retraced much of this decline to generate positive total returns
for the past six months. This recovery was driven by reduced municipal new issue
supply coupled with strong demand for municipal bonds, and the overall rally in
fixed income markets in late March. However, municipal yields are still
significantly greater on an after-tax basis compared to comparable Treasury
bonds and corporate bonds.
Actions of the Federal Reserve and the U.S. Treasury Department have weighed in
on the municipal market since the beginning of the year. To com-
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2 o ALLIANCE MUNICIPAL INCOME FUND II
<PAGE>
----------------------
LETTER TO SHAREHOLDERS
----------------------
bat the risk of higher inflation in the future, the Federal Reserve raised the
Federal Funds rate four times over the past six months to a current rate of
6.50%. Uncertainty regarding future policy decisions has led to some volatility
in the market. We have viewed these periods of volatility as opportunities to
reposition the Fund's portfolios. At the beginning of the year, the Treasury
Department announced that continued improvement of the U.S. budget reduced the
need for borrowing. As a result, the Treasury has instituted a Treasury bond
buyback program targeted at longer-term maturities leading to a substantial rise
in Treasury bond prices. Municipal bond prices tend to trade in the same
direction as Treasury bond prices and have therefore risen as well.
In addition to the overall rise in interest rates, we believe that much of the
market decline in both late fall 1999 and late January 2000 was driven by
technical factors. First, last fall Y2K liquidity demand prompted investors to
shorten maturities and move to cash-equivalent investments in portfolios,
leading to sales of long term bonds. Second, tax-driven trading activity before
the close of 1999 exacerbated the supply imbalance, with investors taking losses
to offset gains in their portfolios in order to limit tax liabilities. Finally,
the market sold off in late January as investors set aside cash in anticipation
of their April 15th tax bills.
The strength in the municipal market was in direct response to the rise in
Treasury bond prices after the announcement of the government buyback program.
Municipal investors finally began moving out of short-term investments into
higher yielding long-term bonds. Market strength was also attributable to a
dramatic decline in new issue volume (down 38% in the first quarter compared to
the same period one year earlier) and strong demand from individual investors.
Most of the decline in volume was the result of higher interest rates and a
higher cost of borrowing for issuers. We expect that once the market settles
into a trading range, new issuance will pick up again. Wealthy investors
continue to have a strong appetite for municipals, as they look for ways to
shelter income from taxes.
Investment Strategy
We viewed the decline in municipal bond prices over the last six months as an
opportunity to achieve several longer term goals for your portfolios including
maximizing current income, reducing the risk of early redemption and generating
tax losses to offset future gains. In 2000, we believe that periods of market
volatility should be viewed as opportunities for further repositioning. Going
forward, this repositioning program will help us to maintain the highest
possible distribution rates, minimize future tax liabilities as well as minimize
long-term reinvestment risk consistent with the objectives and guidelines of the
Fund.
The strong domestic economy continues to enhance the credit fundamentals of
state and local governments. In fact, April 2000 represents the 17th consecutive
month of upgrades exceeding downgrades according to both Moody's and Standard
and Poor's.
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ALLIANCE MUNICIPAL INCOME FUND II o 3
<PAGE>
----------------------
LETTER TO SHAREHOLDERS
----------------------
This has resulted in better-than-projected sales tax and personal income tax
collection -- the largest source of revenues for most states. In addition,
rating agencies continue to reward governmental entities with higher bond
ratings for implementing better forecasting and planning models as well as rainy
day funds. This is because they believe these measures will preserve strong
credit quality through future economic downturns.
--------------------------------------------------------------------------------
[PHOTO OMITTED] John D.
Carifa
[PHOTO OMITTED] Susan P.
Keenan
Portfolio Manager, Susan P. Keenan, also heads the Municipal Bond Department.
She has over 20 years of investment experience.
--------------------------------------------------------------------------------
Market Outlook
In our view, municipal market levels are attractive on both a relative and
absolute basis. The Treasury bond buyback program should continue to depress
Treasury yields placing them at levels equivalent to municipal bond yields
before taking into account the impact of taxes. This should generate additional
demand for municipal bonds as investors recognize the substantial yield spread
afforded to municipal bonds on an after-tax basis. While new issue supply may
pick up as the year progresses, we believe that it will not satisfy the level of
demand. This should lead to strong relative price performance for municipal
bonds. In addition, we expect to see further tightening by the Federal Reserve
in the near term. Until market participants believe that the Federal Reserve has
achieved a neutral bias toward inflation, there should be more periods of
volatility in the market. We view those periods as opportunities to continue our
repositioning strategy.
The Alliance Municipal Income team is proud of our excellent long-term
investment record. We look forward to the opportunity to serve our shareholders
over the next year.
Sincerely,
/s/ John D. Carifa
John D. Carifa
Chairman and President
/s/ Susan P. Keenan
Susan P. Keenan
Senior Vice President
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4 o ALLIANCE MUNICIPAL INCOME FUND II
<PAGE>
------------------
INVESTMENT RESULTS
------------------
INVESTMENT RESULTS
As of March 31, 2000
FUND CLASS A SHARE RETURNS AND MORNINGSTAR RATINGS
Period Ended March 31, 2000
Fund Portfolio
Total Returns (at NAV) Morningstar Morningstar Overall
---------------------- Ratings Ratings Morningstar
Portfolio 6 Months* 12 Months* 3 Years** 5 Years** Ratings**
--------- --------- ---------- --------- --------- ---------
Arizona 2.04% -0.31% 5 5 5
Florida 0.81% -1.92% 4 5 5
Massachusetts 0.61% -2.73% 4 5 5
Michigan 1.88% -0.28% 5 5 5
Minnesota 1.88% -0.81% 4 4 4
New Jersey 0.46% -2.28% 4 4 4
Ohio 0.33% -2.24% 4 5 5
Pennsylvania 1.37% -2.63% 4 4 4
Virginia 1.68% -0.74% 5 5 5
Number of funds in Morningstar
Municipal Bond Fund Category 1,682 1,394 1,682
* Total returns for the Fund's portfolios are based on the net asset value
of Class A shares as of March 31, 2000. All fees and expenses related to
the operation of the Fund have been deducted, but no adjustment has been
made for sales charges that may apply when shares are purchased or
redeemed. Past performance is no guarantee of future results.
** Morningstar proprietary ratings reflect historical risk-adjusted
performance as of March 31, 2000. Ratings may change monthly and are
calculated from each Portfolio's 3-year, 5-year and overall average annual
returns in excess of 90-day Treasury bill returns with appropriate fee
adjustments and a risk factor that reflects portfolio performance below
90-day Treasury bill returns. If the portfolio scores in the top 10% of
its class, it receives 5 stars; if it falls in the next 22.5%, it receives
4 stars; a place in the middle 35% earns it 3 stars; if it falls in the
next 22.5%, it receives 2 stars; and if it scores at the bottom 10%, it
gets 1 star. Each Portfolio's SEC average annual total returns can be
found on page 6.
--------------------------------------------------------------------------------
ALLIANCE MUNICIPAL INCOME FUND II o 5
<PAGE>
------------------
INVESTMENT RESULTS
------------------
INVESTMENT RESULTS
As of March 31, 2000
ALLIANCE MUNICIPAL INCOME FUND II
NAV AND SEC TOTAL RETURNS
<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------
Without Sales Charges With Sales Charges
----------------------------------------------------------------------------------------------------
Since Since
1 Year 5 Years Inception 1 Year 5 Years Inception
----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Arizona Portfolio
Class A -0.31% 6.56% 6.72% -4.51% 5.63% 5.93%
Class B -0.98% 5.83% 5.98% -3.82% 5.83% 5.98%
Class C -0.98% 5.83% 5.98% -1.93% 5.83% 5.98%
Florida Portfolio
Class A -1.92% 6.52% 5.15% -6.10% 5.59% 4.48%
Class B -2.54% 5.78% 4.48%(a) -5.33% 5.78% 4.48%(a)
Class C -2.54% 5.78% 4.40% -3.46% 5.78% 4.40%
Massachusetts Portfolio
Class A -2.73% 6.93% 7.28% -6.85% 6.00% 6.51%
Class B -3.38% 6.22% 6.55% -6.15% 6.22% 6.55%
Class C -3.38% 6.22% 6.56% -4.30% 6.22% 6.56%
Michigan Portfolio
Class A -0.28% 7.17% 6.51% -4.55% 6.24% 5.76%
Class B -0.98% 6.42% 5.78%(a) -3.82% 6.42% 5.78%(a)
Class C -0.98% 6.40% 5.76% -1.92% 6.40% 5.76%
Minnesota Portfolio
Class A -0.81% 6.03% 5.02% -5.00% 5.11% 4.35%
Class B -1.54% 5.26% 4.32% -4.37% 5.26% 4.32%(a)
Class C -1.44% 5.28% 4.26% -2.39% 5.28% 4.26%
New Jersey Portfolio
Class A -2.28% 6.19% 5.09% -6.39% 5.26% 4.43%
Class B -2.98% 5.42% 4.42%(a) -5.77% 5.42% 4.42%(a)
Class C -2.88% 5.42% 4.35% -3.81% 5.42% 4.35%
Ohio Portfolio
Class A -2.24% 6.09% 5.07% -6.39% 5.16% 4.41%
Class B -2.85% 5.35% 4.39%(a) -5.64% 5.35% 4.39%(a)
Class C -2.85% 5.35% 4.33% -3.78% 5.35% 4.33%
Pennsylvania Portfolio
Class A -2.63% 6.30% 5.34% -6.78% 5.37% 4.67%
Class B -3.34% 5.54% 4.67%(a) -6.11% 5.54% 4.67%(a)
Class C -3.34% 5.54% 4.58% -4.26% 5.54% 4.58%
Virginia Portfolio
Class A -0.74% 7.14% 7.08% -4.94% 6.21% 6.30%
Class B -1.41% 6.43% 6.35% -4.23% 6.43% 6.35%
Class C -1.41% 6.43% 6.36% -2.35% 6.43% 6.36%
</TABLE>
The Fund's investment results represent total returns. The NAV and SEC returns
reflect reinvestment of dividends and/or capital gains distributions in
additional shares, without (NAV) and with (SEC) the effect of the 4.25% maximum
front-end sales charge for Class A shares or applicable contingent deferred
sales charge for Class B shares (3% year 1, 2% year 2, 1% year 3, 0% year 4);
and for Class C shares (1% year 1). Returns for Class A shares do not reflect
the imposition of the 1 year 1% contingent deferred sales charge for accounts
over $1,000,000.
Past performance does not guarantee future results. Investment return and
principal value will fluctuate so that an investor's shares, when redeemed, may
be worth more or less than their original cost.
(a) Assumes conversion of Class B shares into Class A shares after six years.
--------------------------------------------------------------------------------
6 o ALLIANCE MUNICIPAL INCOME FUND II
<PAGE>
------------------
INVESTMENT RESULTS
------------------
INVESTMENT RESULTS
As of March 31, 2000
ALLIANCE MUNICIPAL INCOME FUND II
-------------------------------------------------------------------------------
Taxable-Equivalent Yield in
30 Day SEC Yield* 36% Tax Bracket (at NAV)**
-------------------------------------------------------------------------------
Arizona Portfolio
Class A 5.19% 8.69%
Class B 4.73% 7.59%
Class C 4.74% 7.59%
Florida Portfolio
Class A 5.38% 8.55%
Class B 4.92% 7.38%
Class C 4.92% 7.38%
Massachusetts Portfolio
Class A 5.25% 9.07%
Class B 4.79% 7.94%
Class C 4.79% 7.94%
Michigan Portfolio
Class A 5.07% 8.73%
Class B 4.61% 7.60%
Class C 4.61% 7.58%
Minnesota Portfolio
Class A 5.21% 9.00%
Class B 4.74% 7.73%
Class C 4.74% 7.71%
New Jersey Portfolio
Class A 5.23% 9.04%
Class B 4.76% 7.79%
Class C 4.75% 7.79%
Ohio Portfolio
Class A 5.07% 8.96%
Class B 4.58% 7.71%
Class C 4.59% 7.71%
Pennsylvania Portfolio
Class A 5.16% 8.50%
Class B 4.69% 7.31%
Class C 4.70% 7.31%
Virginia Portfolio
Class A 5.39% 8.95%
Class B 4.94% 7.82%
Class C 4.93% 7.82%
* SEC yields are based on SEC guidelines and are calculated on 30 days ended
March 31, 2000.
** The taxable-equivalent yield is based on NAV and a 36% marginal Federal
income tax rate and maximum state, city and local taxes, where applicable.
--------------------------------------------------------------------------------
ALLIANCE MUNICIPAL INCOME FUND II o 7
<PAGE>
------------------
PERFORMANCE UPDATE
------------------
PERFORMANCE UPDATE
ALLIANCE MUNICIPAL INCOME FUND II
GROWTH OF A $10,000 INVESTMENT
Arizona Portfolio
6/30/94 to 3/31/00
[MOUNTAIN CHART OMITTED]
Arizona Portfolio
Class A at NAV:
$14,689
Arizona Portfolio
Class A at offering:
$14,064
Lipper AZ Muni
Funds Average:
$13,594
Florida Portfolio
6/30/93 to 3/31/00
[MOUNTAIN CHART OMITTED]
Florida Portfolio
Class A at NAV:
$14,048
Florida Portfolio
Class A at offering:
$13,455
Lipper FL Muni
Funds Average:
$13,351
Massachusetts Portfolio
3/31/94 to 3/31/00
[MOUNTAIN CHART OMITTED]
Massachusetts
Portfolio
Class A at NAV:
$15,254
Massachusetts
Portfolio
Class A at offering:
$14,611
Lipper MA Muni
Funds Average:
$13,603
Please see mountain chart footnotes on page 11.
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8 o ALLIANCE MUNICIPAL INCOME FUND II
<PAGE>
------------------
PERFORMANCE UPDATE
------------------
PERFORMANCE UPDATE
ALLIANCE MUNICIPAL INCOME FUND II
GROWTH OF A $10,000 INVESTMENT
Michigan Portfolio
2/28/94 to 3/31/00
[MOUNTAIN CHART OMITTED]
Michigan Portfolio
Class A at NAV:
$14,693
Michigan Portfolio
Class A at offering:
$14,074
Lipper MI Muni
Funds Average:
$13,004
Minnesota Portfolio
6/30/93 to 3/31/00
[MOUNTAIN CHART OMITTED]
Minnesota Portfolio
Class A at NAV:
$13,931
Minnesota Portfolio
Class A at offering:
$13,344
Lipper MN Muni
Funds Average:
$13,273
New Jersey Portfolio
6/30/93 to 3/31/00
[MOUNTAIN CHART OMITTED]
New Jersey Portfolio
Class A at NAV:
$13,998
New Jersey Portfolio
Class A at offering:
$13,408
Lipper NJ Muni
Funds Average:
$13,232
Please see mountain chart footnotes on page 11.
--------------------------------------------------------------------------------
ALLIANCE MUNICIPAL INCOME FUND II o 9
<PAGE>
------------------
PERFORMANCE UPDATE
------------------
PERFORMANCE UPDATE
ALLIANCE MUNICIPAL INCOME FUND II
GROWTH OF A $10,000 INVESTMENT
Ohio Portfolio
6/30/93 to 3/31/00
[MOUNTAIN CHART OMITTED]
Ohio Portfolio
Class A at NAV:
$13,980
Ohio Portfolio
Class A at offering:
$13,391
Lipper OH Muni
Funds Average:
$13,386
Pennsylvania Portfolio
6/30/93 to 3/31/00
[MOUNTAIN CHART OMITTED]
Pennsylvania
Portfolio
Class A at NAV:
$14,222
Pennsylvania
Portfolio
Class A at offering:
$13,622
Lipper PA Muni
Funds Average:
$13,322
Please see mountain chart footnotes on page 11.
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10 o ALLIANCE MUNICIPAL INCOME FUND II
<PAGE>
------------------
PERFORMANCE UPDATE
------------------
PERFORMANCE UPDATE
ALLIANCE MUNICIPAL INCOME FUND II
GROWTH OF A $10,000 INVESTMENT
Virginia Portfolio
4/30/94 to 3/31/00
[MOUNTAIN CHART OMITTED]
Virginia Portfolio
Class A at NAV:
$14,993
Virginia Portfolio
Class A at offering:
$14,361
Lipper VA Muni
Funds Average:
$13,667
Each chart illustrates the total value of an assumed $10,000 investment in each
of Alliance Municipal Income Fund II's Class A shares (since the closest
month-end after each Portfolio's inception date through 3/31/00). The charts
reflect the deduction of the maximum 4.25% sales charges from initial $10,000
investments in the Portfolios and assume the reinvestment of dividends and
capital gains. Performance at NAV (net asset value) does not reflect sales
charges, which reduce total return figures. Performance for Class B and Class C
shares will vary from the results shown in these illustrations due to
differences in expenses charged to these classes. Past performance is not
indicative of future results, and is not representative of future gain or loss
in capital value or dividend income.
The Lipper Arizona Municipal Debt Funds Average reflects performance of 22
funds; the Lipper Florida Municipal Debt Funds Average reflects performance of
25 funds; the Lipper Massachusetts Municipal Debt Funds Average reflects
performance of 34 funds; the Lipper Michigan Municipal Debt Funds Average
reflects performance of 31 funds; the Lipper Minnesota Municipal Debt Funds
Average reflects performance of 22 funds; the Lipper New Jersey Municipal Debt
Funds Average reflects performance of 26 funds; the Lipper Ohio Municipal Debt
Funds Average reflects performance of 28 funds; the Lipper Pennsylvania
Municipal Debt Funds Average reflects performance of 35 funds; and the Lipper
Virginia Municipal Debt Funds Average reflects performance of 27 funds. The
funds tracked by Lipper Inc. have generally similar investment objectives to the
applicable Alliance Municipal Income Fund II Portfolios, although some of the
funds may have investment policies that are somewhat different than those of
Alliance Municipal Income Fund II.
When comparing an Alliance Municipal Income Fund II Portfolio to the
corresponding Lipper Average, you should note that no sales charges are
reflected in the performance of the Lipper Averages.
--------------------------------------------------------------------------------
ALLIANCE MUNICIPAL INCOME FUND II o 11
<PAGE>
-----------------
PORTFOLIO SUMMARY
-----------------
PORTFOLIO SUMMARY
March 31, 2000
ARIZONA PORTFOLIO
(CLASS A SHARES)
BOND QUALITY RATING
57.64% AAA
9.81% AA
10.33% A [PIE CHART OMITTED]
12.03% BBB
10.19% NR
INCEPTION DATE
(Class A Shares)
6/1/94
FLORIDA PORTFOLIO
(CLASS A SHARES)
BOND QUALITY RATING
46.29% AAA
4.61% AA
15.02% A [PIE CHART OMITTED]
10.69% BBB
23.39% NR
INCEPTION DATE
(Class A Shares)
6/25/93
MASSACHUSETTS PORTFOLIO
(CLASS A SHARES)
BOND QUALITY RATING
48.55% AAA
31.08% AA [PIE CHART OMITTED]
20.37% BBB
INCEPTION DATE
(Class A Shares)
3/29/94
All data as of March 31, 2000. Each portfolio's quality breakdown is expressed
as a percentage of the portfolio's total investments and may vary over time.
NR - non-rated.
--------------------------------------------------------------------------------
12 o ALLIANCE MUNICIPAL INCOME FUND II
<PAGE>
-----------------
PORTFOLIO SUMMARY
-----------------
PORTFOLIO SUMMARY
March 31, 2000
MICHIGAN PORTFOLIO
(CLASS A SHARES)
BOND QUALITY RATING
56.97% AAA
14.86% AA
4.42% A [PIE CHART OMITTED]
19.20% BBB
4.55% NR
INCEPTION DATE
(Class A Shares)
2/25/94
MINNESOTA PORTFOLIO
(CLASS A SHARES)
BOND QUALITY RATING
46.28% AAA
14.73% AA
14.76% A [PIE CHART OMITTED]
11.18% BBB
13.05% NR
INCEPTION DATE
(Class A Shares)
6/25/93
NEW JERSEY PORTFOLIO
(CLASS A SHARES)
BOND QUALITY RATING
42.72% AAA
2.64% AA
9.05% A [PIE CHART OMITTED]
24.71% BBB
20.88% NR
INCEPTION DATE
(Class A Shares)
6/25/93
All data as of March 31, 2000. Each portfolio's quality breakdown is expressed
as a percentage of the portfolio's total investments and may vary over time.
NR - non-rated.
--------------------------------------------------------------------------------
ALLIANCE MUNICIPAL INCOME FUND II o 13
<PAGE>
-----------------
PORTFOLIO SUMMARY
-----------------
PORTFOLIO SUMMARY
March 31, 2000
OHIO PORTFOLIO
(CLASS A SHARES)
BOND QUALITY RATING
45.82% AAA
4.57% AA [PIE CHART OMITTED]
16.13% A
33.48% BBB
INCEPTION DATE
(Class A Shares)
6/25/93
PENNSYLVANIA PORTFOLIO
(CLASS A SHARES)
BOND QUALITY RATING
52.37% AAA
28.48% AA
3.09% A [PIE CHART OMITTED]
15.04% BBB
1.02% NR
INCEPTION DATE
(Class A Shares)
6/25/93
VIRGINIA PORTFOLIO
(CLASS A SHARES)
BOND QUALITY RATING
20.70% AAA
11.59% AA
27.83% A [PIE CHART OMITTED]
36.26% BBB
3.62% NR
INCEPTION DATE
(Class A Shares)
4/29/94
All data as of March 31, 2000. Each portfolio's quality breakdown is expressed
as a percentage of the portfolio's total investments and may vary over time.
NR - non-rated.
--------------------------------------------------------------------------------
14 o ALLIANCE MUNICIPAL INCOME FUND II
<PAGE>
------------------------
ARIZONA PORTFOLIO
PORTFOLIO OF INVESTMENTS
------------------------
ARIZONA PORTFOLIO
PORTFOLIO OF INVESTMENTS
March 31, 2000 (unaudited)
Standard & Principal
Poor's Amount
Ratings (000) Value
--------------------------------------------------------------------------------
Municipal Bonds-97.5%
Arizona-93.3%
Aaa Arizona Student Loan Acquisition Authority
(Student Loan Rev) Ser 99A -1 AMT
5.90%, 5/01/24(a) ............................. $ 1,500 $ 1,490,385
NR Goodyear Assessment District #1
Ser 96C
7.25%, 7/01/16................................. 3,890 4,121,611
NR Goodyear Dev Auth Water & Sewer Rev
(Lichfield Pk Svc Proj) Ser 99 AMT
5.95%, 10/01/23................................ 3,160 2,881,478
NR Hassayampa Cmnty Fac District #2
Spec Assessment Lien Ser 00
7.50%, 7/01/24................................. 1,240 1,255,636
NR Hassayampa Cmnty Fac District #1
Spec Assessment Lien Ser 96
7.75%, 7/01/21................................. 6,665 7,189,402
AAA Maricopa Cnty GO School Dist No. 28
(Kyrene Elem) FGIC Ser 95B
6.00%, 7/01/14................................. 2,000 2,046,240
AAA Maricopa Cnty Hosp Rev
(Catholic Healthcare West) MBIA Ser 93
7.013%, 7/01/13(b)............................. 2,700 2,761,911
A+ Maricopa Cnty IDR (Citizens Utilities)
Ser 95 AMT
6.20%, 5/01/30................................. 8,550 8,556,840
AAA Maricopa Cnty MFHR
(Shadow Creek Apts Proj) FNMA
Ser 98C AMT
5.20%, 12/15/21................................ 4,520 4,150,083
AAA Mesa Cnty Health Care Fac
(Discovery Hlth Sys) MBIA Ser 99A
5.75%, 1/01/25................................. 10,730 10,672,809
AAA Mesa Cnty Health Care Fac
(Lutheran Hlth Sys) MBIA Ser 98A
5.00%, 1/01/19................................. 4,400 4,052,752
AA- Mohave Cnty IDR
(Cargill/North Star Steel) Ser 95A AMT
6.70%, 3/01/20................................. 3,750 4,013,475
A+ Mohave Cnty IDR
(Citizens Utilities) Ser 93B AMT
5.80%, 11/15/28................................ 2,000 1,895,860
AAA Mohave Cnty MFHR
(Chris Ridge & Silver) GNMA Ser 96
6.375%, 11/01/31............................... 1,000 1,024,480
--------------------------------------------------------------------------------
ALLIANCE MUNICIPAL INCOME FUND II o 15
<PAGE>
------------------------
ARIZONA PORTFOLIO
PORTFOLIO OF INVESTMENTS
------------------------
Standard & Principal
Poor's Amount
Ratings (000) Value
--------------------------------------------------------------------------------
AA+ Phoenix Excise Tax Rev
(Civic Plaza Bldg Corp) Sr Lien Ser 94
6.00%, 7/01/12................................. $ 1,015 $ 1,064,857
AA Phoenix MFHR
(Woodstone & Silver Springs) Asset Gty
Ser 93
6.25%, 4/01/23................................. 3,000 3,052,560
B+ Pima Cnty IDR
(Tucson Electric Pwr) Ser 97B
6.00%, 9/01/29................................. 8,000 7,088,720
AAA Pima Cnty MFHR
(La Hacienda) GNMA Ser 99
7.00%, 12/20/31................................ 1,290 1,407,390
AAA Pima Cnty SFMR
GNMA/FNMA/FHLMC Ser 97A AMT
6.25%, 11/01/30................................ 2,195 2,216,028
AAA Pima Cnty SFMR GNMA Ser 99B-1 AMT
6.10%, 5/01/31................................. 4,260 4,253,866
AAA Tempe MFHR
(Quadrangles) FHA Ser 93
6.25%, 6/01/26................................. 4,055 4,129,531
------------
79,325,914
------------
Puerto Rico-4.2%
AAA Puerto Rico Hsg Fin Corp Rev SFMR
GNMA Ser 98A AMT
5.20%, 12/01/32................................ 4,000 3,532,160
------------
Total Investments-97.5%
(cost $ 81,032,700).......................... 82,858,074
Other assets less liabilities-2.5%............. 2,152,324
------------
Net Assets-100%................................ $ 85,010,398
============
See footnote summary on page 34.
See Glossary of Terms on page 34.
See notes to financial statements.
--------------------------------------------------------------------------------
16 o ALLIANCE MUNICIPAL INCOME FUND II
<PAGE>
------------------------
FLORIDA PORTFOLIO
PORTFOLIO OF INVESTMENTS
------------------------
FLORIDA PORTFOLIO
PORTFOLIO OF INVESTMENTS
March 31, 2000 (unaudited)
Standard & Principal
Poor's Amount
Ratings (000) Value
--------------------------------------------------------------------------------
Florida Municipal Bonds-99.6%
Aaa Brevard Cnty Hsg Fin Auth SFMR
GNMA Ser 94 AMT
6.70%, 9/01/27(a).............................. $ 4,140 $ 4,252,153
A Broward Cnty Hsg Fin Auth MFHR
(Bridgewater Place Apts) Ser 99A AMT
5.50%, 4/01/41................................. 5,640 5,132,456
Aaa Clay Cnty Hsg Fin Auth SFMR
GNMA/FNMA Ser 99 AMT
5.30%, 10/01/29(a)............................. 4,710 4,172,636
NR Collier Cnty Cmnty Dev Dist
(Fiddlers Creek) Ser 96
7.50%, 5/01/18................................. 1,900 1,991,048
A Collier Cnty Cmnty Dev Dist
(Fiddlers Creek) Ser 99B
5.80%, 5/01/21(c).............................. 7,940 7,006,653
A Collier Cnty Hsg Fin Auth MFHR
(Whistlers Green Apts) Ser 99A AMT
5.45%, 6/01/39................................. 5,040 4,574,304
NR Collier Cnty IDR
(Southern States Utils) Ser 96
6.50%, 10/01/25................................ 8,000 8,032,720
AAA Dade Cnty Arpt Rev
(Miami Int'l) MBIA Ser 95B AMT
6.00%, 10/01/24................................ 2,385 2,402,124
A Dade Cnty Hsg Fin Auth
(Golden Lakes Apts) Ser 97A AMT
6.00%, 11/01/32(c)............................. 250 246,120
A Dade Cnty Hsg Fin Auth
(Golden Lakes Apts) Ser 97A AMT
6.05%, 11/01/39(c)............................. 750 730,200
AAA Escambia Cnty Hsg Fin Auth SFMR
FNMA/GNMA Ser 95B AMT
6.25%, 4/01/28................................. 11,500 11,551,520
AAA Florida Hsg Fin Agy MFHR
(Brittany of Rosemont) AMBAC
Ser 95G AMT
6.25%, 7/01/35................................. 1,350 1,378,026
AAA Florida Hsg Fin Agy MFHR
(Landings at Boot Ranch) AMBAC
Ser 95K AMT
6.10%, 11/01/35................................ 2,050 2,075,912
AAA Florida Hsg Fin Agy MFHR
(Turtle Creek Apts) AMBAC
Ser 96C AMT
6.20%, 5/01/36................................. 3,245 3,271,414
--------------------------------------------------------------------------------
ALLIANCE MUNICIPAL INCOME FUND II o 17
<PAGE>
------------------------
FLORIDA PORTFOLIO
PORTFOLIO OF INVESTMENTS
------------------------
Standard & Principal
Poor's Amount
Ratings (000) Value
--------------------------------------------------------------------------------
AAA Florida Hsg Fin Corp MFHR
(Logans Pointe Apts) Ser 99F-1 AMT
6.00%, 6/01/39................................. $ 6,630 $ 6,701,405
A Florida Hsg Fin Corp MFHR
(Spring Harbor Apts) Ser 99C-1 AMT
5.90%, 8/01/39................................. 4,540 4,352,634
Aaa Florida Hsg Fin Corp MFHR
(Waterbridge Apts) MBIA Ser 98R-1 AMT
5.20%, 2/01/32(a).............................. 1,540 1,365,072
AAA Greater Orlando Aviation Auth
(Orlando Arpt) FGIC Ser 99A AMT
5.125%, 10/01/28............................... 6,000 5,347,080
AAA Hillsborough Cnty Aviation Auth
(Tampa Int'l Arpt) FGIC Ser 96A AMT
6.00%, 10/01/23................................ 1,500 1,512,870
AAA Jacksonville Wtr & Swr Rev
(United Wtr Proj) AMBAC Ser 95 AMT
6.35%, 8/01/25................................. 1,500 1,545,795
AAA Lee Cnty Arpt Rev
(Southwest Int'l) FSA Ser 00A AMT
6.00%, 10/01/32................................ 23,000 23,170,660
NR Lee Cnty Comm Fac Dist
(Herons Glen Recreational Dist) Ser 99
6.00%, 5/01/29................................. 10,335 9,217,373
Aaa Manatee Cnty Hsg Fin Auth
SFMR GNMA Ser 99 AMT
6.25%, 11/01/28(a)............................. 3,015 3,121,369
Aa3 North Miami Hlth Fac Auth
(Catholic Hlth Svcs Oblig Grp) Ser 96
6.00%, 8/15/24(a).............................. 1,200 1,177,320
NR Northern Palm Beach Cnty
Dist No. 9A (ABACOA) Ser 96A
7.20%, 8/01/16................................. 6,050 6,349,838
NR Northern Palm Beach Cnty
Dist No. 9A (ABACOA) Ser 96A
7.30%, 8/01/27................................. 8,500 8,919,560
AA Orange Cnty Hlth Facs Auth Rev
(Mayflower Retirement Proj) Asset Gty
Ser 99
5.25%, 6/01/29................................. 4,410 3,967,897
A3 Orange Cnty Hsg Fin Auth MFHR
(Loma Vista Proj) Ser 99G AMT
5.50%, 3/01/32(a).............................. 6,500 5,929,430
A3 Orange Cnty Hsg Fin Auth MFHR
(Seminole Pointe Proj) Ser 99L AMT
5.80%, 6/01/32(a).............................. 6,855 6,529,045
--------------------------------------------------------------------------------
18 o ALLIANCE MUNICIPAL INCOME FUND II
<PAGE>
------------------------
FLORIDA PORTFOLIO
PORTFOLIO OF INVESTMENTS
------------------------
Standard & Principal
Poor's Amount
Ratings (000) Value
--------------------------------------------------------------------------------
A Pasco Cnty Hsg Fin Auth MFHR
(Pasco Woods Apts) Ser 99A AMT
5.90%, 8/01/39................................. $ 3,690 $ 3,522,031
Aaa Pinellas Cnty Hsg Fin Auth SFMR
GNMA/FNMA Ser 94A AMT
6.55%, 8/01/27(a).............................. 4,090 4,167,751
NR St. Johns Cnty
(Julington Creek Plantation) Ser 97
6.70%, 5/01/07................................. 2,830 2,906,608
NR St. Johns Cnty
(Julington Creek Plantation) Ser 97
7.125%, 5/01/19................................ 8,695 9,080,624
Baa2 Volusia Cnty Ed Fac Auth
(Embry-Riddle Aero Univ) Ser 96A
6.125%, 10/15/26(a)............................ 7,060 6,982,270
AA Volusia Cnty Hlth Fac Auth
(John Knox Village) Asset Gty Ser 96A
6.00%, 6/01/17................................. 3,000 3,034,380
AAA Volusia Cnty Hsg Fin Auth MFHR
(Spring Arbor Apts)
FNMA/GNMA Ser 98A AMT
5.25%, 8/01/31................................. 1,955 1,748,454
------------
Total Investments-99.6%
(cost $174,775,067).......................... 177,466,752
Other assets less liabilities-0.4%............. 637,246
------------
Net Assets-100%................................ $178,103,998
============
See footnote summary on page 34.
See Glossary of Terms on page 34.
See notes to financial statements.
--------------------------------------------------------------------------------
ALLIANCE MUNICIPAL INCOME FUND II o 19
<PAGE>
------------------------
MASSACHUSETTS PORTFOLIO
PORTFOLIO OF INVESTMENTS
------------------------
MASSACHUSETTS PORTFOLIO
PORTFOLIO OF INVESTMENTS
March 31, 2000 (unaudited)
Standard & Principal
Poor's Amount
Ratings (000) Value
--------------------------------------------------------------------------------
Massachusetts Municipal Bonds-96.5%
BBB- Massachusetts Dev Fin Agy
(Boston Biomedical) Ser 99
5.75%, 2/01/29................................. $ 1,800 $ 1,584,306
BBB- Massachusetts Dev Fin Agy
(Eastern Nazarene) Ser 99
5.63%, 4/01/29................................. 2,000 1,781,860
AA Massachusetts Dev Fin Agy
(Landmark Sch) Asset Gty Ser 99
5.25%, 6/01/29................................. 2,815 2,485,926
BBB Massachusetts Dev Fin Agy
(Massachusetts College of Pharmacy)
Ser 99B
6.75%, 7/01/30................................. 6,600 6,716,886
BBB+ Massachusetts Dev Fin Agy
(Ogden Haverhill Proj) Ser 98B AMT
5.50%, 12/01/19................................ 2,735 2,320,866
AA Massachusetts Dev Fin Agy
(Seven Hills) Asset Gty Ser 99
5.15%, 9/01/28................................. 6,035 5,378,996
BBB Massachusetts Dev Fin Agy
(Suffolk Univ) Ser 99
5.85%, 7/01/29................................. 1,375 1,304,930
AA Massachusetts Dev Fin Agy
(Worcester Redev Auth) Asset Gty Ser 99
5.25%, 6/01/19................................. 2,350 2,152,389
AA Massachusetts Dev Fin Agy
(Worcester Redev Auth) Asset Gty Ser 99
6.00%, 6/01/24................................. 1,300 1,319,955
BBB+ Massachusetts Dev Fin Agy
(YMCA Greater Boston) Ser 98
5.45%, 11/01/28................................ 1,000 892,690
AAA Massachusetts Ed Fin Auth
(Educational Loan) MBIA Ser 00A AMT
6.00%, 12/01/16................................ 2,000 2,020,200
AAA Massachusetts Hlth & Ed Fac Auth
(Beth Israel) AMBAC Ser G-4
8.07%, 7/01/25(a).............................. 2,000 1,943,440
BBB+ Massachusetts Hlth & Ed Fac Auth
(Jordan Hosp) Ser 92B
6.88%, 10/01/15................................ 1,500 1,530,915
Baa3 Massachusetts Hlth &
Ed Fac Auth (Lasell College)
Ser 99A
5.63%, 7/01/29(a).............................. 7,490 6,728,042
AA+ Massachusetts Hlth & Ed Fac Auth
(Wellesley College) Ser 99F
5.13%, 7/01/39................................. 6,675 5,792,031
--------------------------------------------------------------------------------
20 o ALLIANCE MUNICIPAL INCOME FUND II
<PAGE>
------------------------
MASSACHUSETTS PORTFOLIO
PORTFOLIO OF INVESTMENTS
------------------------
Standard & Principal
Poor's Amount
Ratings (000) Value
--------------------------------------------------------------------------------
AAA Massachusetts Hsg Fin Agy MFHR
AMBAC Ser 95E AMT
6.00%, 7/01/37................................. $ 2,680 $ 2,636,584
AAA Massachusetts Hsg Fin Agy MFHR
FNMA Ser 92A
6.90%, 11/15/24................................ 2,500 2,625,525
AAA Massachusetts Hsg Fin Agy MFHR
(Harbor Point) AMBAC Ser 96A AMT
6.40%, 12/01/15................................ 7,500 7,798,275
AAA Massachusetts Hsg Fin Agy SFMR
FSA Ser 73 AMT
5.90%, 12/01/23................................ 10,000 9,774,800
A+ Massachusetts Hsg Fin Agy SFMR
Ser 40 AMT
6.65%, 12/01/27................................ 9,420 9,721,346
AA+ Massachusetts Ind Fin Agy
(Groton School Proj) Ser 98A
5.00%, 3/01/28................................. 3,440 3,036,075
AAA Massachusetts Ind Fin Agy
(Heights Crossing) FHA Ser 95 AMT
6.15%, 2/01/35................................. 5,000 4,949,850
AAA Massachusetts Muni Wholesale Elec
Power Supply Sys Rev MBIA Ser 92A
6.00%, 7/01/18................................. 4,940 4,976,408
AA- Massachusetts Port Auth
Ser 99D AMT
6.00%, 7/01/29................................. 5,000 4,985,750
AAA Massachusetts Port Auth Spec Fac
(Bosfuel Corp) MBIA Ser 97 AMT
6.00%, 7/01/36................................. 5,600 5,623,016
AAA Massachusetts Port Auth Spec Fac
(US Air) MBIA Ser 96A AMT
5.88%, 9/01/23................................. 6,500 6,422,260
AAA Massachusetts Tpk Auth AMBAC Ser 99A
5.00%, 1/01/39................................. 6,655 5,710,323
------------
Total Investments-96.5%
(cost $108,928,431).......................... 112,213,644
Other assets less liabilities-3.5%............. 4,053,528
------------
Net Assets-100%................................ $116,267,172
============
See footnotes summary on page 34.
See Glossary of Terms on page 34.
See notes to financial statements.
--------------------------------------------------------------------------------
ALLIANCE MUNICIPAL INCOME FUND II o 21
<PAGE>
------------------------
MICHIGAN PORTFOLIO
PORTFOLIO OF INVESTMENTS
------------------------
MICHIGAN PORTFOLIO
PORTFOLIO OF INVESTMENTS
March 31, 2000 (unaudited)
Standard & Principal
Poor's Amount
Ratings (000) Value
--------------------------------------------------------------------------------
Municipal Bonds-98.0%
Michigan-93.3%
BB- Detroit Local Dev Fin Auth
Daimler/Chrysler
(Jefferson North Assembly Plant)
Ser 98A
5.50%, 5/01/21................................. $ 8,070 $ 7,172,213
AAA Detroit Sew Disp Rev
FGIC Ser 93A, Pre-refunded
7.31%, 7/01/23(b).............................. 1,700 1,843,446
Aa2 Independence Eco Dev Auth
(Greenery Health) FHA Ser 97A
6.15%, 8/01/17(a).............................. 1,850 1,868,611
AAA Kalamazoo Hosp Fin Auth
(Borgess Med Ctr) FGIC Ser 94A
6.21%, 6/01/11(b).............................. 7,500 7,462,500
AAA Michigan Hosp Fin Auth
(Detroit Medical Ctr) AMBAC Ser 97A
5.25%, 8/15/27................................. 2,000 1,764,540
Aaa Michigan Hsg Dev Auth MFHR
(Arbor Pointe) GNMA Ser 99
5.40%, 6/20/40(a).............................. 1,810 1,645,634
Aaa Michigan Hsg Dev Auth MFHR
(Oakbrook Villa) GNMA Ser 00A
6.50%, 1/20/42(a).............................. 3,000 3,058,170
AA+ Michigan Hsg Dev Auth SFMR
FHA Ser 96B AMT
6.20%, 6/01/27................................. 1,800 1,807,812
NR Michigan Strategic Fund
(Holland Home) Ser 98
5.75%, 11/15/28................................ 2,200 1,698,576
AAA Michigan Strategic Fund
(Detroit Edison) MBIA Ser 95AA
6.40%, 9/01/25................................. 1,760 1,828,094
BBB+ Romulus Tax Increment Fin Auth Ser 94
6.75%, 11/01/19................................ 1,585 1,650,429
AAA Saginaw Hosp Fin Auth
(Convenant Medical Ctr) MBIA Ser 99E
5.50%, 7/01/24................................. 2,000 1,889,960
AA Troy Downtown Dev Auth
Asset Gty Ser 95A
6.375%, 11/01/18............................... 1,800 1,873,782
------------
35,563,767
------------
--------------------------------------------------------------------------------
22 o ALLIANCE MUNICIPAL INCOME FUND II
<PAGE>
------------------------
MICHIGAN PORTFOLIO
PORTFOLIO OF INVESTMENTS
------------------------
Standard & Principal
Poor's Amount
Ratings (000) Value
--------------------------------------------------------------------------------
Puerto Rico-4.7%
AAA Puerto Rico Hsg Fin Corp Rev SFMR
GNMA Ser 98A AMT
5.20%, 12/01/32................................ $ 2,030 $ 1,792,571
------------
Total Investments-98.0%
cost $36,455,635)............................ 37,356,338
Other assets less liabilities-2.0%............. 759,146
------------
Net Assets-100%................................ $ 38,115,484
============
See footnote summary on page 34.
See Glossary of Terms on page 34.
See notes to financial statements.
--------------------------------------------------------------------------------
ALLIANCE MUNICIPAL INCOME FUND II o 23
<PAGE>
------------------------
MINNESOTA PORTFOLIO
PORTFOLIO OF INVESTMENTS
------------------------
MINNESOTA PORTFOLIO
PORTFOLIO OF INVESTMENTS
March 31, 2000 (unaudited)
Standard & Principal
Poor's Amount
Ratings (000) Value
--------------------------------------------------------------------------------
Minnesota Municipal Bonds-93.9%
A Bass Brook PCR
(Minn Power & Light) Ser 92
6.00%, 7/01/22................................. $ 1,800 $ 1,717,056
AAA Duluth Arpt Lease Rev GO
Ser 95C AMT
6.25%, 8/01/14................................. 1,460 1,513,874
Aaa Eagan MFHR
(Woodridge Apts Proj) GNMA Ser 97 A
5.95%, 2/01/32(a).............................. 1,405 1,412,517
A- Golden Valley Health Fac
Covenant Retmt Cmty Ser 99A
5.50%, 12/01/29................................ 3,750 3,146,100
Aaa Little Canada MFHR
(Cedars Lakeside Apts) GNMA Ser 97A
5.95%, 2/01/32(a).............................. 1,600 1,608,560
NR Minneapolis Hlth Fac
(Walker Methodist) Ser 98A
6.00%, 11/15/28................................ 5,000 4,051,850
AAA Minneapolis MFHR
(Riverside Plaza Proj)
GNMA Ser 98 AMT
5.20%, 12/20/30................................ 1,900 1,706,694
AAA Minnesota Agric & Eco Dev
(Benedictine Health) MBIA Ser 99A
5.13%, 2/15/29................................. 2,000 1,772,400
NR Minnesota Agric & Eco Dev
(Small Business Loan Prog)
Ser 96A AMT
6.75%, 8/01/16................................. 1,450 1,507,753
Ser 96B AMT
7.00%, 8/01/16................................. 750 770,385
Ser 00A AMT
7.25%, 8/01/20................................. 1,000 1,019,220
Ser 00B AMT
7.00%, 8/01/16................................. 1,000 1,003,450
Baa1 Minnesota Higher Ed Fac Auth
(Hamline Univ) Ser 4-I
6.00%, 10/01/16(a)............................. 790 790,411
AA+ Minnesota Hsg Fin Agy
SFMR Ser 96G AMT
6.25%, 7/01/26................................. 1,700 1,715,351
Aaa Minnetonka MFHR
(Archer Heights Apts Proj) GNMA
Ser 99A AMT
5.30%, 1/20/27(a).............................. 1,620 1,491,194
--------------------------------------------------------------------------------
24 o ALLIANCE MUNICIPAL INCOME FUND II
<PAGE>
------------------------
MINNESOTA PORTFOLIO
PORTFOLIO OF INVESTMENTS
------------------------
Standard & Principal
Poor's Amount
Ratings (000) Value
--------------------------------------------------------------------------------
AA+ Rochester Hosp Rev
(Mayo Med Ctr) Ser 92H
7.76%, 11/15/15(b)............................. $ 3,000 $ 3,138,840
Aaa St. Paul MFHR
(Wellington Proj) FHLMC Ser 99A
5.10%, 2/01/24(a).............................. 1,850 1,694,470
BBB- South St. Paul Hosp Rev
(Health East Proj) Ser 94
6.75%, 11/01/09................................ 3,000 2,893,530
------------
Total Investments-93.9%
(cost $32,147,918)........................... 32,953,655
Other assets less liabilities-6.1%............. 2,136,352
------------
Net Assets-100%................................ $ 35,090,007
============
See footnote summary on page 34.
See Glossary of Terms on page 34.
See notes to financial statements.
--------------------------------------------------------------------------------
ALLIANCE MUNICIPAL INCOME FUND II o 25
<PAGE>
------------------------
NEW JERSEY PORTFOLIO
PORTFOLIO OF INVESTMENTS
------------------------
NEW JERSEY PORTFOLIO
PORTFOLIO OF INVESTMENTS
March 31, 2000 (unaudited)
Standard & Principal
Poor's Amount
Ratings (000) Value
--------------------------------------------------------------------------------
Municipal Bonds-98.3%
New Jersey-89.4%
AAA New Jersey Eco Dev
(American Water Co) FGIC Ser 94A AMT
6.875%, 11/01/34............................... $ 5,000 $ 5,321,000
A+ New Jersey Eco Dev
(Anheuser-Busch) Ser 95 AMT
5.85%, 12/01/30................................ 9,000 8,798,580
AAA New Jersey Eco Dev
(Hackensack Water Co) MBIA
Ser 94B AMT
5.90%, 3/01/24................................. 4,000 4,017,520
NR New Jersey Eco Dev
(Kapkowski Rd) Ser 98B AMT
6.50%, 4/01/31................................. 29,085 27,890,770
BBB New Jersey Eco Dev PCR
(NUI Corp) Ser 98A AMT
5.25%, 11/01/33................................ 25,000 20,373,500
AAA New Jersey Eco Dev
(Pub Ser Elec & Gas) MBIA Ser 94A AMT
6.40%, 5/01/32................................. 5,000 5,185,050
AAA New Jersey Higher Ed
Student Loan MBIA Ser 99A AMT
5.25%, 6/01/18................................. 1,500 1,420,905
BBB- New Jersey Hlth Care Fac
(Englewood Hosp & Med Ctr) Ser 94
6.75%, 7/01/24................................. 4,230 3,899,383
BBB New Jersey Hlth Care Fac
(Franciscan Sisters St. Mary's Hosp)
Ser 93
5.875%, 7/01/12................................ 2,755 2,853,574
A New Jersey Hlth Care Fac
(Palisades Med Ctr) ACA Ser 99
5.25%, 7/01/28................................. 3,840 3,285,197
AAA New Jersey Hlth Care Fac
(St. Barnabas Hosp) Ser 98B
5.00%, 7/01/24................................. 5,000 4,389,450
AAA New Jersey Hsg & Mtg Fin Agy MFHR
FSA Ser 00A1 AMT
6.35%, 11/01/31................................ 2,000 2,032,320
AAA New Jersey Hsg & Mtg Fin Agy
SFMR Home Buyers MBIA Ser 95O AMT
6.35%, 10/01/27................................ 5,000 5,086,200
--------------------------------------------------------------------------------
26 o ALLIANCE MUNICIPAL INCOME FUND II
<PAGE>
------------------------
NEW JERSEY PORTFOLIO
PORTFOLIO OF INVESTMENTS
------------------------
Standard & Principal
Poor's Amount
Ratings (000) Value
--------------------------------------------------------------------------------
AAA Passaic Valley Sewer System
AMBAC Ser 92D
5.75%, 12/01/15................................ $ 3,400 $ 3,441,174
AAA Port Auth of NY & NJ
(JFK Int'l Airport Proj) MBIA Ser 6 AMT
5.75%, 12/01/22................................ 6,810 6,732,911
AAA Port Auth of NY & NJ 96th
FGIC Ser 94 AMT
6.60%, 10/01/23................................ 9,000 9,433,980
AA- Salem Cnty NJ / Waste
Disposal Auth (E.I. Dupont) Ser 97A AMT
6.13%, 7/15/22................................. 3,500 3,529,015
BBB South Jersey Transportation Auth
Lease Rev (Raytheon Aircraft Service)
Ser 97A AMT
6.15%, 1/01/22................................. 500 475,260
AAA Vineland NJ Sewer Auth
(Landis) FGIC Ser 93C
6.92%, 9/19/19(b).............................. 3,250 3,326,765
------------
121,492,554
------------
Puerto Rico-8.9%
AAA Puerto Rico Hsg Fin Corp Rev SFMR
GNMA, Ser 98A AMT
5.20%, 12/01/32................................ 7,550 6,666,952
BBB- Puerto Rico Port Auth
(American Airlines) Ser 96A AMT
6.25%, 6/01/26................................. 5,475 5,398,131
------------
12,065,083
------------
Total Investments-98.3%
(cost $130,306,314).......................... 133,557,637
Other assets less liabilities-1.7%............. 2,279,322
------------
Net Assets-100%................................ $135,836,959
============
See footnote summary on page 34.
See Glossary of Terms on page 34.
See notes to financial statements.
--------------------------------------------------------------------------------
ALLIANCE MUNICIPAL INCOME FUND II o 27
<PAGE>
------------------------
OHIO PORTFOLIO
PORTFOLIO OF INVESTMENTS
------------------------
OHIO PORTFOLIO
PORTFOLIO OF INVESTMENTS
March 31, 2000 (unaudited)
Standard & Principal
Poor's Amount
Ratings (000) Value
--------------------------------------------------------------------------------
Ohio Municipal Bonds-94.9%
BBB Akron (Canal Park) COP Ser 96
Zero Coupon, 12/01/01(d)....................... $ 5,000 $ 4,885,100
AAA Akron (University of Akron)
FGIC Ser 99
5.75% 1/01/29.................................. 3,000 2,966,430
BB Cleveland Arpt Rev
(Continental Airlines) Ser 98 AMT
5.375%, 9/15/27................................ 20,015 15,888,107
AAA Cleveland Arpt Sys
FGIC Ser 94A AMT
6.25%, 1/01/20................................. 4,500 4,599,360
AAA Columbus Municipal Arpt Rev
(Columbus Int'l Arpt) MBIA Ser 94A AMT
6.25%, 1/01/24................................. 4,000 4,076,600
A Franklin Cnty
(OCLC Online Computer Library Ctr)
Ser 98
5.20%, 10/01/20................................ 4,885 4,549,987
Aaa Lucas Cnty Health Fac
(Altenheim Project) GNMA Ser 99
5.50%, 7/20/40(a).............................. 3,200 2,895,296
AAA Ohio Air Quality Dev Auth
(JMG Funding) AMBAC Ser 94B AMT
6.375%, 4/01/29................................ 4,300 4,418,078
BBB+ Ohio Air Quality Dev Auth PCR
(Columbus Southern Pwr Co.) Ser 85B
6.25%, 12/01/20................................ 4,400 4,364,272
BB+ Ohio Air Quality Dev Auth PCR
(Toledo Edison Co) Ser 97A AMT
6.10%, 8/01/27................................. 5,000 4,516,200
AAA Ohio Capital Corp. MFHR
(Sect 8 Assist) FHA/MBIA Ser 95E
6.35%, 1/01/22................................. 1,965 2,016,758
Aa2 Ohio Hsg Fin Agy MFHR
(Bridgeview Villa II) FHA AMT
6.45%, 12/01/33(a)............................. 1,965 2,003,514
AAA Ohio Hsg Fin Agy SFMR
GNMA Ser 95 A-2 AMT
6.625%, 3/01/26................................ 4,310 4,428,353
AAA Ohio Hsg Fin Agy SFMR
GNMA Ser 97 A-1 AMT
6.15%, 3/01/29................................. 4,700 4,699,671
Aaa Ohio Hsg Fin Agy SFMR
GNMA Ser 00 A-1 AMT
6.35%, 9/01/31(a).............................. 10,000 10,119,200
--------------------------------------------------------------------------------
28 o ALLIANCE MUNICIPAL INCOME FUND II
<PAGE>
------------------------
OHIO PORTFOLIO
PORTFOLIO OF INVESTMENTS
------------------------
Standard & Principal
Poor's Amount
Ratings (000) Value
--------------------------------------------------------------------------------
A+ Ohio Wtr Dev Auth
(Anheuser-Busch) Ser 99 AMT
6.00%, 8/01/29................................. $ 2,250 $ 2,243,610
A- Ohio Wtr Dev Auth Solid Waste Rev
(North Star/BHP) Ser 95 AMT
6.45%, 9/01/20................................. 2,425 2,479,126
Aa3 Toledo-Lucas Cnty Port Fac
(Cargill Inc. Proj) Ser 93
5.90%, 12/01/15(a)............................. 2,000 2,012,160
Baa2 Toledo-Lucas Cnty Port Fac
(CSX Transportation) Ser 92
6.45%, 12/15/21(a)............................. 4,650 4,622,611
------------
Total Investments-94.9%
(cost $86,052,596)........................... 87,784,433
Other assets less liabilities-5.1%............. 4,740,003
------------
Net Assets-100%................................ $ 92,524,436
============
See footnote summary on page 34.
See Glossary of Terms on page 34.
See notes to financial statements.
--------------------------------------------------------------------------------
ALLIANCE MUNICIPAL INCOME FUND II o 29
<PAGE>
------------------------
PENNSYLVANIA PORTFOLIO
PORTFOLIO OF INVESTMENTS
------------------------
PENNSYLVANIA PORTFOLIO
PORTFOLIO OF INVESTMENTS
March 31, 2000 (unaudited)
Standard & Principal
Poor's Amount
Ratings (000) Value
--------------------------------------------------------------------------------
Pennsylvania Municipal Bonds-96.7%
A Allegheny Cnty Higher Ed
(Thiel College) ACA Ser 99A
5.375%, 11/15/19............................... $ 2,300 $ 2,090,953
A Allegheny Cnty Higher Ed
(Thiel College) ACA Ser 99A
5.375%, 11/15/29............................... 2,000 1,758,640
BBB- Allegheny Cnty IDR
PCR (USX Corp) Ser 96
6.10%, 1/15/18................................. 4,000 3,789,560
Aaa Allegheny Cnty MFHR
(Green Meadow Apt) FHA Ser 98 A-1 AMT
5.125%, 10/20/40(a)............................ 6,340 5,448,659
BBB Crawford Cnty Hosp Auth
(Wesbury Methodist Cmnty) Ser 99
6.25%, 8/15/29(c).............................. 2,100 1,801,002
BBB+ Cumberland Cnty
Municipal Auth Rev
(Presbyterian Homes Inc) Ser 96
6.00%, 12/01/26................................ 3,000 2,498,850
BBB- Delaware Cnty Higher Ed
(Eastern College) Ser 99C
5.625%, 10/01/28............................... 3,300 2,850,375
AAA Lehigh Cnty Hosp Rev
(Lehigh Valley Health) MBIA Ser 99A
5.25%, 7/01/29................................. 3,500 3,117,275
AA Montgomery Cnty Higher Ed
(Beaver College) Asset Gty Ser 99
5.70%, 4/01/27................................. 6,000 5,722,320
AAA Montgomery Cnty Hlth Fac
(Holy Redeemer Hlth Sys) AMBAC Ser 97A
5.25%, 10/01/23................................ 2,150 1,953,297
AAA North East GO
School Dist FGIC Ser 98
5.20%, 9/01/23................................. 3,285 2,987,017
AA Northhampton Cnty Higher Ed
(Moravian College) Asset Gty Ser 99
5.125%, 7/01/29................................ 1,000 872,290
BBB Pennsylvania Econ Dev Auth
Waste Water Rev
(Sun Co) Ser 94A AMT
7.60%, 12/01/24................................ 5,000 5,402,500
--------------------------------------------------------------------------------
30 o ALLIANCE MUNICIPAL INCOME FUND II
<PAGE>
------------------------
PENNSYLVANIA PORTFOLIO
PORTFOLIO OF INVESTMENTS
------------------------
Standard & Principal
Poor's Amount
Ratings (000) Value
--------------------------------------------------------------------------------
AAA Pennsylvania Higher Ed
(Student Loan) AMBAC Ser 88D AMT
6.05%, 1/01/19................................. $ 5,900 $ 5,922,951
AAA Pennsylvania Higher Ed
(University of Pittsburgh Med Ctr)
FSA Ser 99A
5.00%, 8/01/29................................. 20,000 17,137,600
AA+ Pennsylvania Hsg Fin Agy
SFMR Ser 92-35D AMT
7.50%, 4/01/25(b).............................. 9,500 9,719,450
AA+ Pennsylvania Hsg Fin Agy
SFMR Ser 99 66A AMT
5.65%, 4/01/29................................. 4,625 4,337,603
AA+ Pennsylvania Hsg Fin Agy
SFMR Ser 99 67A AMT
5.90%, 10/01/30................................ 10,000 9,670,900
AA+ Pennsylvania Hsg Fin Agy
SFMR FHA Ser 00 69A AMT
6.25%, 4/01/31................................. 5,065 5,128,718
AAA Philadelphia Arpt Sys Rev
AMBAC Ser 95A AMT
6.10%, 6/15/25................................. 10,000 10,126,500
AAA Philadelphia Gas Wks Rev
FSA Ser 99-16
5.50%, 7/01/15................................. 2,000 1,993,680
AAA Philadelphia Gas Wks Rev
FSA Ser 99-16
5.25%, 7/01/29................................. 4,600 4,197,224
AAA Philadelphia GO
FSA Ser 98
5.00%, 3/15/28................................. 5,000 4,358,050
BBB+ Philadelphia Hosp Rev
(Temple Univ Hospital) Ser 93A
6.625%, 11/15/23............................... 3,250 3,049,443
AAA Philadelphia Pkg Auth Rev
AMBAC Ser 99A
5.25%, 2/15/29................................. 4,600 4,172,568
AAA Pittsburgh Urban Redev Auth SFMR
FHA/GNMA/FNMA Ser 97A AMT
6.25%, 10/01/28................................ 920 926,274
NR Susquehanna Regl Arpt Auth
(Aero Harrisburg) Ser 99 AMT
5.50%, 1/01/24................................. 1,490 1,269,420
--------------------------------------------------------------------------------
ALLIANCE MUNICIPAL INCOME FUND II o 31
<PAGE>
------------------------
PENNSYLVANIA PORTFOLIO
PORTFOLIO OF INVESTMENTS
------------------------
Standard & Principal
Poor's Amount
Ratings (000) Value
--------------------------------------------------------------------------------
BBB Warren Cnty Hosp Auth
(Warren General) Ser 94A
7.00%, 4/01/19................................. $ 2,200 $ 2,184,006
------------
Total Investments-96.7%
(cost $121,065,886).......................... 124,487,125
Other assets less liabilities-3.3%............. 4,195,733
------------
Net Assets-100%................................ $128,682,858
============
See footnote summary on page 34.
See Glossary of Terms on page 34.
See note to financial statements.
--------------------------------------------------------------------------------
32 o ALLIANCE MUNICIPAL INCOME FUND II
<PAGE>
------------------------
VIRGINIA PORTFOLIO
PORTFOLIO OF INVESTMENTS
------------------------
VIRGINIA PORTFOLIO
PORTFOLIO OF INVESTMENTS
March 31, 2000 (unaudited)
Standard & Principal
Poor's Amount
Ratings (000) Value
--------------------------------------------------------------------------------
Municipal Bonds-95.4%
Virginia-90.4%
A Alexandria MFHR
(Buckingham Village Apts) Ser 96A AMT
6.15%, 1/01/29................................. $ 4,000 $ 3,999,520
Baa2 Bedford Cnty IDR
(Nekoosa Pkg/GA Pacific) Ser 99 AMT
6.30%, 12/01/25(a)............................. 3,000 2,925,240
Baa2 Bedford Cnty IDR
(Nekoosa Pkg/GA Pacific) Ser 99A AMT
6.55%, 12/01/25(a)............................. 7,200 7,228,296
BBB Giles Cnty IDR
(Hoechst Celanese Corp) Ser 96 AMT
6.45%, 5/01/26................................. 7,500 7,225,200
Baa2 Goochland Cnty IDR
(Nekoosa Pkg/GA Pacific) Ser 98 AMT
5.65%, 12/01/25(a)............................. 14,000 12,439,560
A- Greater Richmond Hotel Auth
(Convention Ctr Proj) Ser 00
6.25%, 6/15/32................................. 11,000 11,272,470
AAA Harrisonburg MFHR
(Battery Heights Assoc) GNMA Ser 96A
6.25%, 4/20/36................................. 4,185 4,280,251
AAA Harrisonburg MFHR
(Greens of Salem Run) FSA Ser 97 AMT
6.30%, 4/01/29................................. 4,160 4,274,774
BB- Henrico Cnty IDR Solid Waste Rev
(Browning-Ferris) Ser 97A AMT
5.875%, 3/01/17................................ 2,750 2,375,093
A+ Henry Cnty Hosp Rev
(Memorial Hosp Martinsville & Henry)
Ser 97
6.00%, 1/01/27................................. 1,250 1,215,825
BBB+ Isle of Wight Cnty Solid Waste Rev
(Union Camp Corp) Ser 94 AMT
6.55%, 4/01/24................................. 4,000 4,023,520
A+ James City Cnty Solid Waste Rev
(Anheuser Busch Proj) Ser 97 AMT
6.00%, 4/01/32................................. 4,200 4,194,036
AAA Loudoun Cnty IDR Hosp Rev
(Loudoun Hosp Ctr) FSA Ser 95
5.80%, 6/01/20................................. 2,500 2,509,925
AA- Metropolitan Washington DC Arpt Rev
Ser 97B AMT
5.50%, 10/01/23................................ 4,700 4,439,855
AAA Newport News MFHR
(Mennowood Cmntys) GNMA Ser 96A
6.25%, 8/01/36................................. 2,620 2,684,766
--------------------------------------------------------------------------------
ALLIANCE MUNICIPAL INCOME FUND II o 33
<PAGE>
------------------------
VIRGINIA PORTFOLIO
PORTFOLIO OF INVESTMENTS
------------------------
Standard & Principal
Poor's Amount
Ratings (000) Value
--------------------------------------------------------------------------------
NR Staunton Ed Fac
(Mary Baldwin College) Ser 96
6.75%, 11/01/21................................ $ 3,145 $ 3,211,831
AA+ Virginia Hsg Dev Auth MFHR Ser 99 AMT
5.95%, 2/01/23................................. 4,525 4,474,455
AA+ Virginia Res Auth Sewer Sys Rev
(Hopewell Regl Wastewater Fac)
Ser 95A AMT
6.00%, 10/01/25................................ 1,375 1,377,448
------------
84,152,065
------------
Puerto Rico-5.0%
AAA Puerto Rico Hsg Fin Corp Rev SFMR
GNMA Ser 98A AMT
5.20%, 12/01/32................................ 5,240 4,627,130
------------
Total Investments-95.4%
(cost $86,869,103)........................... 88,779,195
Other assets less liabilities-4.6%............. 4,310,679
------------
Net Assets-100%................................ $ 93,089,874
============
(a) Moody's Rating.
(b) Inverse floater security-security with variable or floating interest rate
that moves in opposite direction of short-term interest rates.
(c) Fitch's Rating.
(d) Indicates a security that has a zero coupon that remains in effect until
12/01/01. On 12/01/01 it converts to 6.907% and will remain in effect
until 12/01/16.
See notes to financial statements.
Glossary of Terms:
ACA American Capital Access
AMBAC American Municipal Bond Assurance Corporation
AMT Alternative Minimum Tax
COP Certificate of Participation
FGIC Financial Guaranty Insurance Company
FHA Federal Housing Administration
FHLMC Federal Home Loan Mortgage Corporation
FNMA Federal National Mortgage Association
FSA Financial Security Assurance, Inc.
GNMA Government National Mortgage Association
GO General Obligation
IDR Industrial Development Revenue
MBIA Municipal Bond Investors Assurance
MFHR Multi-Family Housing Revenue
NR Rating not applied for
PCR Pollution Control Revenue
SFMR Single Family Mortgage Revenue
--------------------------------------------------------------------------------
34 o ALLIANCE MUNICIPAL INCOME FUND II
<PAGE>
---------------------------------
STATEMENT OF ASSETS & LIABILITIES
---------------------------------
STATEMENT OF ASSETS & LIABILITIES
March 31, 2000 (unaudited)
<TABLE>
<CAPTION>
Arizona Florida
------------- -------------
<S> <C> <C>
Assets
Investment in securities, at value
(cost: $81,032,700 and $174,775,067,
respectively) ........................... $ 82,858,074 $ 177,466,752
Cash ....................................... 2,565 -0-
Interest receivable ........................ 1,495,771 3,550,970
Receivable for investment securities sold .. 525,836 9,515,870
Receivable for shares of beneficial interest
sold .................................... 399,814 2,161,673
------------- -------------
Total assets ............................... 85,282,060 192,695,265
------------- -------------
Liabilities
Due to custodian ........................... -0- 38,862
Dividends payable .......................... 146,133 310,341
Distribution fee payable ................... 48,130 114,034
Payable for shares of beneficial interest
redeemed ................................ 19,882 202,915
Advisory fee payable ....................... 6,787 36,384
Payable for investment securities purchased -0- 13,769,781
Accrued expenses and other liabilities ..... 50,730 118,950
------------- -------------
Total liabilities .......................... 271,662 14,591,267
------------- -------------
Net Assets ................................. $ 85,010,398 $ 178,103,998
============= =============
Composition Of Net Assets
Shares of beneficial interest, at par ...... $ 82,354 $ 185,040
Additional paid-in capital ................. 87,362,081 192,902,832
Distributions in excess of net investment
income .................................. (133,973) (229,738)
Accumulated net realized loss on
investment transactions ................. (4,125,438) (17,445,821)
Net unrealized appreciation of investments . 1,825,374 2,691,685
------------- -------------
$ 85,010,398 $ 178,103,998
============= =============
Class A Shares
Net assets ................................. $ 43,157,182 $ 72,053,640
------------- -------------
Shares of beneficial interest outstanding .. 4,179,111 7,487,654
------------- -------------
Class B Shares
Net assets ................................. $ 32,595,545 $ 64,720,416
------------- -------------
Shares of beneficial interest outstanding .. 3,159,006 6,723,273
------------- -------------
Class C Shares
Net assets ................................. $ 9,257,671 $ 41,329,942
------------- -------------
Shares of beneficial interest outstanding .. 897,284 4,293,022
------------- -------------
Calculation Of Maximum Offering Price
Class A Shares
Net asset value and redemption price
per share ............................... $ 10.33 $ 9.62
Sales charge--4.25% of public
offering price .......................... .46 .43
------------- -------------
Maximum offering price ..................... $ 10.79 $ 10.05
============= =============
Class B Shares
Net asset value and offering price
per share ............................... $ 10.32 $ 9.63
============= =============
Class C Shares
Net asset value and offering price
per share ............................... $ 10.32 $ 9.63
============= =============
</TABLE>
See notes to financial statements
--------------------------------------------------------------------------------
ALLIANCE MUNICIPAL INCOME FUND II o 35
<PAGE>
---------------------------------
STATEMENT OF ASSETS & LIABILITIES
---------------------------------
<TABLE>
<CAPTION>
Massachusetts Michigan
------------- -------------
<S> <C> <C>
Assets
Investment in securities, at value
(cost: $108,928,431 and $36,455,635,
respectively) ........................... $ 112,213,644 $ 37,356,338
Receivable for investment securities sold .. 10,308,952 910,213
Interest receivable ........................ 1,884,908 559,722
Receivable for shares of beneficial interest
sold .................................... 261,325 98,845
------------- -------------
Total assets ............................... 124,668,829 38,925,118
------------- -------------
Liabilities
Due to custodian ........................... 6,539 10,322
Payable for investment securities purchased 7,751,685 608,717
Payable for shares of beneficial interest
redeemed ................................ 271,971 66,135
Dividends payable .......................... 204,841 64,867
Distribution fee payable ................... 75,056 25,257
Advisory fee payable ....................... 12,018 5,122
Accrued expenses and other liabilities ..... 79,547 29,214
------------- -------------
Total liabilities .......................... 8,401,657 809,634
------------- -------------
Net Assets ................................. $ 116,267,172 $ 38,115,484
============= =============
Composition Of Net Assets
Shares of beneficial interest, at par ...... $ 111,437 $ 38,193
Additional paid-in capital ................. 123,527,522 38,877,393
Distributions in excess of net investment
income .................................. (20,629) (16,887)
Accumulated net realized loss on
investment transactions ................. (10,636,371) (1,683,918)
Net unrealized appreciation of investments . 3,285,213 900,703
------------- -------------
$ 116,267,172 $ 38,115,484
============= =============
Class A Shares
Net assets ................................. $ 46,482,662 $ 13,886,302
------------- -------------
Shares of beneficial interest outstanding .. 4,451,807 1,390,474
------------- -------------
Class B Shares
Net assets ................................. $ 39,767,194 $ 13,104,210
------------- -------------
Shares of beneficial interest outstanding .. 3,813,405 1,313,586
------------- -------------
Class C Shares
Net assets ................................. $ 30,017,316 $ 11,124,972
------------- -------------
Shares of beneficial interest outstanding .. 2,878,520 1,115,177
------------- -------------
Calculation Of Maximum Offering Price
Class A Shares
Net asset value and redemption price
per share ............................... $ 10.44 $ 9.99
Sales charge--4.25% of public
offering price .......................... .46 .44
------------- -------------
Maximum offering price ..................... $ 10.90 $ 10.43
============= =============
Class B Shares
Net asset value and offering price
per share ............................... $ 10.43 $ 9.98
============= =============
Class C Shares
Net asset value and offering price
per share ............................... $ 10.43 $ 9.98
============= =============
</TABLE>
See notes to financial statements.
--------------------------------------------------------------------------------
36 o ALLIANCE MUNICIPAL INCOME FUND II
<PAGE>
---------------------------------
STATEMENT OF ASSETS & LIABILITIES
---------------------------------
<TABLE>
<CAPTION>
Minnesota New Jersey
------------- -------------
<S> <C> <C>
Assets
Investment in securities, at value
(cost: $32,147,918 and $130,306,314,
respectively) ........................... $ 32,953,655 $ 133,557,637
Cash ....................................... 26,973 63,895
Receivable for investment securities sold .. 2,872,300 -0-
Interest receivable ........................ 513,396 3,253,108
Receivable due from Adviser ................ 2,211 -0-
Receivable for shares of beneficial interest
sold .................................... 374 1,762,156
------------- -------------
Total assets ............................... 36,368,909 138,636,796
------------- -------------
Liabilities
Payable for investment securities purchased 1,000,805 2,041,970
Payable for shares of beneficial interest
redeemed ................................ 162,008 319,153
Dividends payable .......................... 59,837 231,821
Distribution fee payable ................... 22,076 93,199
Advisory fee payable ....................... -0- 27,831
Accrued expenses and other liabilities ..... 34,176 85,863
------------- -------------
Total liabilities .......................... 1,278,902 2,799,837
------------- -------------
Net Assets ................................. $ 35,090,007 $ 135,836,959
============= =============
Composition Of Net Assets
Shares of beneficial interest, at par ...... $ 36,574 $ 139,696
Additional paid-in capital ................. 37,004,345 142,647,491
Distributions in excess of net investment
income .................................. (21,960) (32,280)
Accumulated net realized loss on
investment transactions ................. (2,734,689) (10,169,271)
Net unrealized appreciation of investments . 805,737 3,251,323
------------- -------------
$ 35,090,007 $ 135,836,959
============= =============
Class A Shares
Net assets ................................. $ 15,060,226 $ 45,937,477
------------- -------------
Shares of beneficial interest outstanding .. 1,569,845 4,724,293
------------- -------------
Class B Shares
Net assets ................................. $ 12,186,930 $ 59,518,719
------------- -------------
Shares of beneficial interest outstanding .. 1,270,210 6,121,353
------------- -------------
Class C Shares
Net assets ................................. $ 7,842,851 $ 30,380,763
------------- -------------
Shares of beneficial interest outstanding .. 817,330 3,123,914
------------- -------------
Calculation Of Maximum Offering Price
Class A Shares
Net asset value and redemption price
per share ............................... $ 9.59 $ 9.72
Sales charge--4.25% of public
offering price .......................... .43 .43
------------- -------------
Maximum offering price ..................... $ 10.02 $ 10.15
============= =============
Class B Shares
Net asset value and offering price
per share ............................... $ 9.59 $ 9.72
============= =============
Class C Shares
Net asset value and offering price
per share ............................... $ 9.60 $ 9.73
============= =============
</TABLE>
See notes to financial statements.
--------------------------------------------------------------------------------
ALLIANCE MUNICIPAL INCOME FUND II o 37
<PAGE>
---------------------------------
STATEMENT OF ASSETS & LIABILITIES
---------------------------------
<TABLE>
<CAPTION>
Ohio Pennsylvania
------------- -------------
<S> <C> <C>
Assets
Investment in securities, at value
(cost: $86,052,596 and $121,065,886,
respectively) ........................... $ 87,784,433 $ 124,487,125
Cash ....................................... 86,895 -0-
Receivable for investment securities sold .. 6,523,354 2,313,960
Interest receivable ........................ 793,058 2,682,003
Receivable for shares of beneficial interest
sold .................................... 213,295 383,709
Receivable due from Adviser ................ 3,262 -0-
------------- -------------
Total assets ............................... 95,404,297 129,866,797
------------- -------------
Liabilities
Due to custodian ........................... -0- 422,234
Payable for investment securities purchased 2,198,963 -0-
Payable for shares of beneficial interest
redeemed ................................ 371,023 342,836
Dividends payable .......................... 154,657 218,330
Distribution fee payable ................... 64,764 77,544
Advisory fee payable ....................... -0- 43,625
Accrued expenses and other liabilities ..... 90,454 79,370
------------- -------------
Total liabilities .......................... 2,879,861 1,183,939
------------- -------------
Net Assets ................................. $ 92,524,436 $ 128,682,858
============= =============
Composition Of Net Assets
Shares of beneficial interest, at par ...... $ 96,018 $ 131,796
Additional paid-in capital ................. 99,029,538 135,601,632
Distributions in excess of net investment
income .................................. (62,069) (129,984)
Accumulated net realized loss on
investment transactions ................. (8,270,888) (10,341,825)
Net unrealized appreciation of investments . 1,731,837 3,421,239
------------- -------------
$ 92,524,436 $ 128,682,858
============= =============
Class A Shares
Net assets ................................. $ 27,191,644 $ 59,154,800
------------- -------------
Shares of beneficial interest outstanding .. 2,822,387 6,058,537
------------- -------------
Class B Shares
Net assets ................................. $ 42,660,326 $ 46,476,758
------------- -------------
Shares of beneficial interest outstanding .. 4,427,202 4,760,035
------------- -------------
Class C Shares
Net assets ................................. $ 22,672,466 $ 23,051,300
------------- -------------
Shares of beneficial interest outstanding .. 2,352,269 2,361,024
------------- -------------
Calculation Of Maximum Offering Price
Class A Shares
Net asset value and redemption price
per share ............................... $ 9.63 $ 9.76
Sales charge--4.25% of public
offering price .......................... .43 .43
------------- -------------
Maximum offering price ..................... $ 10.06 $ 10.19
============= =============
Class B Shares
Net asset value and offering price
per share ............................... $ 9.64 $ 9.76
============= =============
Class C Shares
Net asset value and offering price
per share ............................... $ 9.64 $ 9.76
============= =============
</TABLE>
See notes to financial statements.
--------------------------------------------------------------------------------
38 o ALLIANCE MUNICIPAL INCOME FUND II
<PAGE>
---------------------------------
STATEMENT OF ASSETS & LIABILITIES
---------------------------------
Virginia
------------
Assets
Investment in securities, at value
(cost: $86,869,103) ........................... $ 88,779,195
Cash ............................................. 12,607
Receivable for investment securities sold ........ 2,149,270
Interest receivable .............................. 1,898,927
Receivable for shares of beneficial interest
sold .......................................... 662,468
------------
Total assets ..................................... 93,502,467
------------
Liabilities
Dividends payable ................................ 159,972
Payable for shares of beneficial interest redeemed 142,786
Distribution fee payable ......................... 61,369
Advisory fee payable ............................. 11,606
Accrued expenses and other liabilities ........... 36,860
------------
Total liabilities ................................ 412,593
------------
Net Assets ....................................... $ 93,089,874
============
Composition Of Net Assets
Shares of beneficial interest, at par ............ $ 91,220
Additional paid-in capital ....................... 96,913,769
Distributions in excess of net investment
income ........................................ (96,032)
Accumulated net realized loss on
investment transactions ....................... (5,729,175)
Net unrealized appreciation of investments ....... 1,910,092
------------
....................................... $ 93,089,874
============
Class A Shares
Net assets ....................................... $ 33,164,069
------------
Shares of beneficial interest outstanding ........ 3,247,273
------------
Class B Shares
Net assets ....................................... $ 44,798,805
------------
Shares of beneficial interest outstanding ........ 4,391,375
------------
Class C Shares
Net assets ....................................... $ 15,127,000
------------
Shares of beneficial interest outstanding ........ 1,483,383
------------
Calculation Of Maximum Offering Price
Class A Shares
Net asset value and redemption price
per share ..................................... $ 10.21
Sales charge--4.25% of public
offering price ................................ .45
------------
Maximum offering price ........................... $ 10.66
============
Class B Shares
Net asset value and offering price
per share ..................................... $ 10.20
============
Class C Shares
Net asset value and offering price
per share ..................................... $ 10.20
============
See notes to financial statements.
--------------------------------------------------------------------------------
ALLIANCE MUNICIPAL INCOME FUND II o 39
<PAGE>
-----------------------
STATEMENT OF OPERATIONS
-----------------------
STATEMENT OF OPERATIONS
March 31, 2000 (unaudited)
Arizona Florida
----------- -----------
Investment Income
Interest .............................. $ 2,430,176 $ 5,710,633
----------- -----------
Expenses
Advisory fee .......................... 249,099 570,708
Distribution fee - Class A ............ 58,094 110,545
Distribution fee - Class B ............ 158,324 332,934
Distribution fee - Class C ............ 46,589 211,756
Administrative ........................ 46,000 46,000
Custodian ............................. 44,873 66,193
Transfer agency ....................... 19,348 54,701
Audit and legal ....................... 17,396 36,584
Registration .......................... 11,170 21,584
Printing .............................. 2,767 17,869
Trustees' fees ........................ 1,300 1,300
Miscellaneous ......................... 2,588 6,401
----------- -----------
Total expenses ........................ 657,548 1,476,575
Less: expenses waived and reimbursed by
Adviser (see Note B) ............... (203,235) (428,705)
----------- -----------
Net expenses .......................... 454,313 1,047,870
----------- -----------
Net investment income ................. 1,975,863 4,662,763
----------- -----------
Realized And Unrealized Gain (Loss)
On Investments
Net realized loss on investment
transactions ....................... (1,761,913) (6,734,010)
Net change in unrealized appreciation/
depreciation of investments ........ 1,377,332 2,891,703
----------- -----------
Net loss on investments ............... (384,581) (3,842,307)
----------- -----------
Net Increase In Net Assets
From Operations .................... $ 1,591,282 $ 820,456
=========== ===========
See notes to financial statements.
--------------------------------------------------------------------------------
40 o ALLIANCE MUNICIPAL INCOME FUND II
<PAGE>
-----------------------
STATEMENT OF OPERATIONS
-----------------------
Massachussetts Michigan
-------------- -------------
Investment Income
Interest .............................. $ 3,802,749 $ 1,161,907
----------- -----------
Expenses
Advisory fee .......................... 374,728 116,786
Distribution fee - Class A ............ 74,749 18,929
Distribution fee - Class B ............ 205,216 67,228
Distribution fee - Class C ............ 145,185 56,534
Custodian ............................. 62,483 47,477
Administrative ........................ 46,000 46,000
Transfer agency ....................... 36,101 17,438
Audit and legal ....................... 22,156 12,270
Registration .......................... 17,590 4,679
Printing .............................. 5,360 4,742
Trustees' fees ........................ 1,300 1,300
Miscellaneous ......................... 3,759 2,496
----------- -----------
Total expenses ........................ 994,627 395,879
Less: expenses waived and reimbursed by
Adviser (see Note B) ............... (317,660) (129,862)
----------- -----------
Net expenses .......................... 676,967 266,017
----------- -----------
Net investment income ................. 3,125,782 895,890
----------- -----------
Realized And Unrealized Gain (Loss)
On Investments
Net realized loss on investment
transactions ....................... (5,575,737) (864,237)
Net change in unrealized appreciation/
depreciation of investments ........ 2,969,141 575,601
----------- -----------
Net loss on investments ............... (2,606,596) (288,636)
----------- -----------
Net Increase In Net Assets
From Operations .................... $ 519,186 $ 607,254
=========== ===========
See notes to financial statements.
--------------------------------------------------------------------------------
ALLIANCE MUNICIPAL INCOME FUND II o 41
<PAGE>
-----------------------
STATEMENT OF OPERATIONS
-----------------------
Minnesota New Jersey
----------- -----------
Investment Income
Interest .............................. $ 1,099,513 $ 4,126,023
----------- -----------
Expenses
Advisory fee .......................... 110,198 417,984
Distribution fee - Class A ............ 20,288 58,812
Distribution fee - Class B ............ 66,246 315,248
Distribution fee - Class C ............ 42,443 157,486
Administrative ........................ 46,000 46,000
Custodian ............................. 45,032 46,506
Transfer agency ....................... 17,525 64,112
Audit and legal ....................... 11,790 27,561
Printing .............................. 2,569 4,678
Trustees' fees ........................ 1,300 1,300
Registration .......................... 1,229 6,037
Miscellaneous ......................... 2,786 5,082
----------- -----------
Total expenses ........................ 367,406 1,150,806
Less: expenses waived and reimbursed by
Adviser (see Note B) ............... (158,409) (268,345)
----------- -----------
Net expenses .......................... 208,997 882,461
----------- -----------
Net investment income ................. 890,516 3,243,562
----------- -----------
Realized And Unrealized Gain (Loss)
On Investments
Net realized loss on investment
transactions ....................... (816,847) (3,781,417)
Net change in unrealized appreciation/
depreciation of investments ........ 513,635 892,352
----------- -----------
Net loss on investments ............... (303,212) (2,889,065)
----------- -----------
Net Increase In Net Assets
From Operations .................... $ 587,304 $ 354,497
=========== ===========
See notes to financial statements.
--------------------------------------------------------------------------------
42 o ALLIANCE MUNICIPAL INCOME FUND II
<PAGE>
-----------------------
STATEMENT OF OPERATIONS
-----------------------
Ohio Pennsylvania
----------- ------------
Investment Income
Interest .............................. $ 3,029,961 $ 4,264,194
----------- -----------
Expenses
Advisory fee .......................... 304,058 417,552
Distribution fee - Class A ............ 41,108 89,315
Distribution fee - Class B ............ 231,104 244,447
Distribution fee - Class C ............ 118,365 125,920
Custodian ............................. 47,795 53,796
Administrative ........................ 46,000 46,000
Transfer agency ....................... 38,233 51,334
Audit and legal ....................... 19,703 25,504
Registration .......................... 13,574 10,315
Printing .............................. 9,166 8,170
Trustees' fees ........................ 1,300 1,300
Miscellaneous ......................... 3,107 3,108
----------- -----------
Total expenses ........................ 873,513 1,076,761
Less: expenses waived and reimbursed by
Adviser (see Note B) ............... (261,706) (180,392)
----------- -----------
Net expenses .......................... 611,807 896,369
----------- -----------
Net investment income ................. 2,418,154 3,367,825
----------- -----------
Realized And Unrealized Gain (Loss)
On Investments
Net realized loss on investment
transactions ....................... (3,085,718) (4,225,802)
Net change in unrealized appreciation/
depreciation of investments ........ 614,318 2,106,303
----------- -----------
Net loss on investments ............... (2,471,400) (2,119,499)
----------- -----------
Net Increase (Decrease) In Net Assets
From Operations .................... $ (53,246) $ 1,248,326
=========== ===========
See notes to financial statements
--------------------------------------------------------------------------------
ALLIANCE MUNICIPAL INCOME FUND II o 43
<PAGE>
-----------------------
STATEMENT OF OPERATIONS
-----------------------
Virginia
-----------
Investment Income
Interest ................................................ $ 2,702,550
-----------
Expenses
Advisory fee ............................................ 272,818
Distribution fee - Class A .............................. 45,073
Distribution fee - Class B .............................. 218,338
Distribution fee - Class C .............................. 67,927
Custodian ............................................... 50,195
Administrative .......................................... 46,000
Transfer agency ......................................... 26,741
Audit and legal ......................................... 15,981
Registration ............................................ 5,824
Printing ................................................ 3,177
Trustees' fees .......................................... 1,300
Miscellaneous ........................................... 2,480
-----------
Total expenses .......................................... 755,854
Less: expenses waived and reimbursed by
Adviser (see Note B) ................................. (262,972)
-----------
Net expenses ............................................ 492,882
-----------
Net investment income ................................... 2,209,668
-----------
Realized And Unrealized Gain (Loss)
On Investments
Net realized loss on investment
transactions ......................................... (2,356,117)
Net change in unrealized appreciation/
depreciation of investments .......................... 1,575,740
-----------
Net loss on investments ................................. (780,377)
-----------
Net Increase In Net Assets
From Operations ...................................... $ 1,429,291
===========
See notes to financial statements.
--------------------------------------------------------------------------------
44 o ALLIANCE MUNICIPAL INCOME FUND II
<PAGE>
----------------------------------
STATEMENT OF CHANGES IN NET ASSETS
----------------------------------
STATEMENT OF CHANGES IN NET ASSETS
Arizona
------------------------------
Six Months
Ended Year Ended
March 31, 2000 September 30,
(unaudited) 1999
------------ ------------
Increase (Decrease) In Net Assets
From Operations
Net investment income ...................... $ 1,975,863 $ 2,551,128
Net realized loss on investment
transactions ............................ (1,761,913) (2,363,497)
Net change in unrealized appreciation/
depreciation of investments ............. 1,377,332 (1,186,209)
------------ ------------
Net increase (decrease) in net assets from
operations .............................. 1,591,282 (998,578)
Dividends And Distributions To
Shareholders From:
Net investment income
Class A ................................. (1,042,281) (1,422,629)
Class B ................................. (741,790) (856,109)
Class C ................................. (218,534) (272,390)
Distributions in excess of net investment
income
Class A ................................. -0- (93,745)
Class B ................................. -0- (75,448)
Class C ................................. -0- (24,429)
Net realized gain on investments
Class A ................................. -0- (79,250)
Class B ................................. -0- (55,031)
Class C ................................. -0- (18,802)
Transactions In Shares Of Beneficial
Interest
Net increase ............................... 6,339,984 43,387,517
------------ ------------
Total increase ............................. 5,928,661 39,491,106
Net Assets
Beginning of year .......................... 79,081,737 39,590,631
------------ ------------
End of period .............................. $ 85,010,398 $ 79,081,737
============ ============
See notes to financial statements
--------------------------------------------------------------------------------
ALLIANCE MUNICIPAL INCOME FUND II o 45
<PAGE>
----------------------------------
STATEMENT OF CHANGES IN NET ASSETS
----------------------------------
Florida
--------------------------------
Six Months
Ended Year Ended
March 31, 2000 September 30,
(unaudited) 1999
------------- -------------
Increase (Decrease) In Net Assets
From Operations
Net investment income .................... $ 4,662,763 $ 7,436,826
Net realized loss on investment
transactions .......................... (6,734,010) (6,777,319)
Net change in unrealized appreciation/
depreciation of investments ........... 2,891,703 (4,449,716)
------------- -------------
Net increase (decrease) in net assets from
operations ............................ 820,456 (3,790,209)
Dividends And Distributions To
Shareholders From:
Net investment income
Class A ............................... (2,031,190) (3,312,718)
Class B ............................... (1,589,424) (2,459,083)
Class C ............................... (1,012,312) (1,665,025)
Distributions in excess of net investment
income
Class A ............................... -0- (171,909)
Class B ............................... -0- (150,028)
Class C ............................... -0- (106,023)
Transactions In Shares Of Beneficial
Interest
Net increase (decrease) .................. (7,536,858) 84,405,261
------------- -------------
Total increase (decrease) ................ (11,349,328) 72,750,266
Net Assets
Beginning of year ........................ 189,453,326 116,703,060
------------- -------------
End of period ............................ $ 178,103,998 $ 189,453,326
============= =============
See notes to financial statements.
--------------------------------------------------------------------------------
46 o ALLIANCE MUNICIPAL INCOME FUND II
<PAGE>
----------------------------------
STATEMENT OF CHANGES IN NET ASSETS
----------------------------------
Massachusetts
--------------------------------
Six Months
Ended Year Ended
March 31, 2000 September 30,
(unaudited) 1999
------------- -------------
Increase (Decrease) In Net Assets
From Operations
Net investment income .................... $ 3,125,782 $ 4,187,302
Net realized loss on investment
transactions .......................... (5,575,737) (5,060,634)
Net change in unrealized appreciation/
depreciation of investments ........... 2,969,141 (1,540,378)
------------- -------------
Net increase (decrease) in net assets from
operations ............................ 519,186 (2,413,710)
Dividends And Distributions To
Shareholders From:
Net investment income
Class A ................................ (1,341,373) (1,836,597)
Class B ................................ (965,638) (1,342,251)
Class C ................................ (683,716) (1,008,454)
Distributions in excess of net investment
income
Class A ................................ -0- (135,677)
Class B ................................ -0- (131,050)
Class C ................................ -0- (102,932)
Net realized gain on investments
Class A ................................ -0- (80,419)
Class B ................................ -0- (63,701)
Class C ................................ -0- (54,163)
Transactions In Shares Of Beneficial
Interest
Net increase ............................. 1,987,116 62,444,310
------------- -------------
Total increase (decrease) ................ (484,425) 55,275,356
Net Assets
Beginning of year ........................ 116,751,597 61,476,241
------------- -------------
End of period ............................ $ 116,267,172 $ 116,751,597
============= =============
See notes to financial statements.
--------------------------------------------------------------------------------
ALLIANCE MUNICIPAL INCOME FUND II o 47
<PAGE>
----------------------------------
STATEMENT OF CHANGES IN NET ASSETS
----------------------------------
Michigan
------------------------------
Six Months
Ended Year Ended
March 31, 2000 September 30,
(unaudited) 1999
------------ ------------
Increase (Decrease) In Net Assets
From Operations
Net investment income ...................... $ 895,890 $ 1,306,512
Net realized loss on investment
transactions ............................ (864,237) (794,295)
Net change in unrealized appreciation/
depreciation of investments ............. 575,601 (772,736)
------------ ------------
Net increase (decrease) in net assets from
operations .............................. 607,254 (260,519)
Dividends And Distributions To
Shareholders From:
Net investment income
Class A ................................. (322,750) (461,761)
Class B ................................. (295,842) (447,452)
Class C ................................. (249,166) (397,299)
Distributions in excess of net investment
income
Class A ................................. -0- (30,996)
Class B ................................. -0- (38,763)
Class C ................................. -0- (35,476)
Net realized gain on investments
Class A ................................. -0- (58,573)
Class B ................................. -0- (65,313)
Class C ................................. -0- (63,713)
Transactions In Shares Of Beneficial
Interest
Net increase ............................... 2,024,016 11,177,569
------------ ------------
Total increase ............................. 1,763,512 9,317,704
Net Assets
Beginning of year .......................... 36,351,972 27,034,268
------------ ------------
End of period .............................. $ 38,115,484 $ 36,351,972
============ ============
See notes to financial statements.
--------------------------------------------------------------------------------
48 o ALLIANCE MUNICIPAL INCOME FUND II
<PAGE>
----------------------------------
STATEMENT OF CHANGES IN NET ASSETS
----------------------------------
Minnesota
------------------------------
Six Months
Ended Year Ended
March 31, 2000 September 30,
(unaudited) 1999
------------ ------------
Increase (Decrease) In Net Assets
From Operations
Net investment income ...................... $ 890,516 $ 1,373,071
Net realized loss on investment
transactions ............................ (816,847) (774,099)
Net change in unrealized appreciation/
depreciation of investments ............. 513,635 (1,040,378)
------------ ------------
Net increase (decrease) in net assets from
operations .............................. 587,304 (441,406)
Dividends And Distributions To
Shareholders From:
Net investment income
Class A ................................. (366,643) (410,462)
Class B ................................. (305,004) (610,472)
Class C ................................. (196,228) (352,137)
Distributions in excess of net investment
income
Class A ................................. -0- (13,422)
Class B ................................. -0- (25,067)
Class C ................................. -0- (13,957)
Transactions In Shares Of Beneficial
Interest
Net increase ............................... 1,578,021 7,815,621
------------ ------------
Total increase ............................. 1,297,450 5,948,698
Net Assets
Beginning of year .......................... 33,792,557 27,843,859
------------ ------------
End of period .............................. $ 35,090,007 $ 33,792,557
============ ============
See notes to financial statements.
--------------------------------------------------------------------------------
ALLIANCE MUNICIPAL INCOME FUND II o 49
<PAGE>
----------------------------------
STATEMENT OF CHANGES IN NET ASSETS
----------------------------------
New Jersey
--------------------------------
Six Months
Ended Year Ended
March 31, 2000 September 30,
(unaudited) 1999
------------- -------------
Increase (Decrease) In Net Assets
From Operations
Net investment income .................... $ 3,243,562 $ 4,960,041
Net realized loss on investment
transactions .......................... (3,781,417) (2,765,281)
Net change in unrealized appreciation/
depreciation of investments ........... 892,352 (3,817,282)
------------- -------------
Net increase (decrease) in net assets from
operations ............................ 354,497 (1,622,522)
Dividends And Distributions To
Shareholders From:
Net investment income
Class A ............................... (1,022,107) (1,250,108)
Class B ............................... (1,395,170) (2,454,054)
Class C ............................... (697,759) (1,255,879)
Distributions in excess of net investment
income
Class A ............................... -0- (16,310)
Class B ............................... -0- (57,365)
Class C ............................... -0- (32,337)
Transactions In Shares Of Beneficial
Interest
Net increase ............................. 7,981,547 40,926,509
------------- -------------
Total increase ........................... 5,221,008 34,237,934
Net Assets
Beginning of year ........................ 130,615,951 96,378,017
------------- -------------
End of period ............................ $ 135,836,959 $ 130,615,951
============= =============
See notes to financial statements.
--------------------------------------------------------------------------------
50 o ALLIANCE MUNICIPAL INCOME FUND II
<PAGE>
----------------------------------
STATEMENT OF CHANGES IN NET ASSETS
----------------------------------
Ohio
--------------------------------
Six Months
Ended Year Ended
March 31, 2000 September 30,
(unaudited) 1999
------------- -------------
Increase (Decrease) In Net Assets
From Operations
Net investment income .................... $ 2,418,154 $ 3,735,632
Net realized loss on investment
transactions .......................... (3,085,718) (2,325,166)
Net change in unrealized appreciation/
depreciation of investments ........... 614,318 (2,893,533)
------------- -------------
Net decrease in net assets from
operations ............................ (53,246) (1,483,067)
Dividends And Distributions To
Shareholders From:
Net investment income
Class A ............................... (737,326) (914,541)
Class B ............................... (1,066,360) (1,908,969)
Class C ............................... (546,947) (912,122)
Distributions in excess of net investment
income
Class A ............................... -0- (44,837)
Class B ............................... -0- (108,943)
Class C ............................... -0- (49,086)
Transactions In Shares Of Beneficial
Interest
Net increase (decrease) .................. (5,481,418) 37,636,801
------------- -------------
Total increase (decrease) ................ (7,885,297) 32,215,236
Net Assets
Beginning of year ........................ 100,409,733 68,194,497
------------- -------------
End of period ............................ $ 92,524,436 $ 100,409,733
============= =============
See notes to financial statements.
--------------------------------------------------------------------------------
ALLIANCE MUNICIPAL INCOME FUND II o 51
<PAGE>
----------------------------------
STATEMENT OF CHANGES IN NET ASSETS
----------------------------------
Pennsylvania
--------------------------------
Six Months
Ended Year Ended
March 31, 2000 September 30,
(unaudited) 1999
------------- -------------
Increase (Decrease) In Net Assets
From Operations
Net investment income .................... $ 3,367,825 $ 5,141,597
Net realized loss on investment
transactions .......................... (4,225,802) (5,789,857)
Net change in unrealized appreciation/
depreciation of investments ........... 2,106,303 (3,757,992)
------------- -------------
Net increase (decrease) in net assets from
operations ............................ 1,248,326 (4,406,252)
Dividends And Distributions To
Shareholders From:
Net investment income
Class A ............................... (1,599,380) (2,252,015)
Class B ............................... (1,128,417) (1,940,681)
Class C ............................... (582,133) (948,902)
Distributions in excess of net investment
income
Class A ............................... -0- (167,278)
Class B ............................... -0- (181,017)
Class C ............................... -0- (84,332)
Transactions In Shares Of Beneficial
Interest
Net increase (decrease) .................. (11,661,704) 59,757,965
------------- -------------
Total increase (decrease) ................ (13,723,308) 49,777,488
Net Assets
Beginning of year ........................ 142,406,166 92,628,678
------------- -------------
End of period ............................ $ 128,682,858 $ 142,406,166
============= =============
See notes to financial statements.
--------------------------------------------------------------------------------
52 o ALLIANCE MUNICIPAL INCOME FUND II
<PAGE>
----------------------------------
STATEMENT OF CHANGES IN NET ASSETS
----------------------------------
Virginia
------------------------------
Six Months
Ended Year Ended
March 31, 2000 September 30,
(unaudited) 1999
------------ ------------
Increase (Decrease) In Net Assets
From Operations
Net investment income ...................... $ 2,209,668 $ 2,352,613
Net realized loss on investment
transactions ............................ (2,356,117) (3,373,058)
Net change in unrealized appreciation/
depreciation of investments ............. 1,575,740 (384,519)
------------ ------------
Net increase (decrease) in net assets from
operations .............................. 1,429,291 (1,404,964)
Dividends And Distributions To
Shareholders From:
Net investment income
Class A ................................. (822,952) (833,405)
Class B ................................. (1,045,367) (1,174,902)
Class C ................................. (325,713) (344,306)
Distributions in excess of net investment
income
Class A ................................. -0- (91,739)
Class B ................................. -0- (167,735)
Class C ................................. -0- (48,628)
Net realized gain on investments
Class A ................................. -0- (31,533)
Class B ................................. -0- (51,651)
Class C ................................. -0- (14,082)
Transactions In Shares Of Beneficial
Interest
Net increase ............................... 10,738,438 56,394,462
------------ ------------
Total increase ............................. 9,973,697 52,231,517
Net Assets
Beginning of year .......................... 83,116,177 30,884,660
------------ ------------
End of period .............................. $ 93,089,874 $ 83,116,177
============ ============
See notes to financial statements.
--------------------------------------------------------------------------------
ALLIANCE MUNICIPAL INCOME FUND II o 53
<PAGE>
-----------------------------
NOTES TO FINANCIAL STATEMENTS
-----------------------------
NOTES TO FINANCIAL STATEMENTS
March 31, 2000 (unaudited)
NOTE A
Significant Accounting Policies
Alliance Municipal Income Fund II (the "Fund") which is a Massachusetts Business
Trust, is registered under the Investment Company Act of 1940, as a
non-diversified open-end management investment company. The Fund operates as a
series company currently comprised of nine portfolios: Arizona Portfolio,
Florida Portfolio, Massachusetts Portfolio, Michigan Portfolio, Minnesota
Portfolio, New Jersey Portfolio, Ohio Portfolio, Pennsylvania Portfolio and
Virginia Portfolio (the "Portfolios"). Each series is considered to be a
separate entity for financial reporting and tax purposes. Each portfolio offers
Class A, Class B and Class C shares. Class A shares are sold with a front-end
sales charge of up to 4.25% for purchases not exceeding $1,000,000. With respect
to purchases of $1,000,000 or more, Class A shares redeemed within one year of
purchase may be subject to a contingent deferred sales charge of 1%. Class B
shares are currently sold with a contingent deferred sales charge which declines
from 3% to zero depending on the period of time the shares are held. Class B
shares will automatically convert to Class A shares six years after the end of
the calendar month of purchase. Class C shares are subject to a contingent
deferred sales charge of 1% on redemptions made within the first year after
purchase. All three classes of shares have identical voting, dividend,
liquidation and other rights and the same terms and conditions, except that each
class bears different distribution expenses and has exclusive voting rights with
respect to its distribution plan. The financial statements have been prepared in
conformity with generally accepted accounting principles which require
management to make certain estimates and assumptions that affect the reported
amounts of assets and liabilities in the financial statements and amounts of
income and expenses during the reporting period. Actual results could differ
from those estimates. The following is a summary of the significant accounting
policies followed by the Fund.
1. Security Valuation
Portfolio securities traded on a national securities exchange are valued at the
last sale price on such exchange on the day of valuation or, if there was no
sale on such day, the last bid price quoted on such day. If no bid prices are
quoted, then the security is valued at the mean of the bid and asked prices as
obtained on that day from one or more dealers regularly making a market in that
security. Securities traded on the over-the-counter market are valued at the
mean of the closing bid and asked price provided by two or more dealers
regularly making a market in such securities. U.S. government securities and
other debt securities which mature in 60 days or less are valued at amortized
cost unless this method does not represent fair value. Securities for which
market quotations are not readily available are valued at fair value as
determined in good faith by, or in accordance with procedures approved by, the
Board of Trustees. Fixed income securities may be valued on the basis of prices
provided by a pricing service when such prices are believed to reflect the fair
market value of such securities.
--------------------------------------------------------------------------------
54 o ALLIANCE MUNICIPAL INCOME FUND II
<PAGE>
-----------------------------
NOTES TO FINANCIAL STATEMENTS
-----------------------------
2. Taxes
It is the policy of each Portfolio to meet the requirements of the Internal
Revenue Code applicable to regulated investment companies and to distribute all
of its investment company taxable income and net realized gains, if any, to its
shareholders. Therefore, no provisions for federal income or excise taxes are
required.
3. Investment Income and Investment Transactions
Interest income is accrued daily. Investment transactions are accounted for on
the date securities are purchased or sold. Investment gains and losses are
determined on the identified cost basis. The Portfolios amortize premium and
accrete original issue discount and market discount as adjustments to interest
income.
The Portfolios follow an investment policy of investing primarily in municipal
obligations of one state. Economic changes affecting the state and certain of
its public bodies and municipalities may affect the ability of issuers within
the state to pay interest on, or repay principal of, municipal obligations held
by the Portfolios.
4. Income and Expenses
All income earned and expenses incurred by the Portfolios are borne on a
pro-rata basis by each settled class of shares, based on the proportionate
interest in the Portfolios represented by the net assets of such class, except
that the Portfolio's Class B and Class C shares bear higher distribution and
transfer agent fees than Class A shares.
5. Dividends and Distributions
Dividends and distributions to shareholders are recorded on the ex-dividend
date.
Income and capital gains distribution are determined in accordance with federal
tax regulations and may differ from those determined in accordance with
generally accepted accounting principles. To the extent these differences are
permanent, such amounts are reclassified with the capital accounts based on
their federal tax basis treatment; temporary differences, do not require such
reclassification.
NOTE B
Advisory Fee and Other Transactions with Affiliates
Under the terms of an investment advisory agreement, the Fund pays Alliance
Capital Management L.P. (the "Adviser") an advisory fee at an annual rate of
.625 of 1% of each Portfolio's average daily net assets. Such fees are accrued
daily and paid monthly. For the six months ended March 31, 2000, the Adviser
agreed to waive all or a portion of its advisory fees. The aggregate amounts of
such fee waivers were: Arizona Portfolio, $180,235; Florida Portfolio, $428,705;
Massachusetts Portfolio, $317,660; Michigan Portfolio, $83,862; Minnesota
Portfolio, $110,198; New Jersey Portfolio, $268,345; Ohio Portfolio, $261,706;
Pennsylvania Portfolio, $180,392; and Virginia Portfolio, $216,972.
Pursuant to the advisory agreement, the Adviser provides to each Portfolio
certain legal and accounting services.
--------------------------------------------------------------------------------
ALLIANCE MUNICIPAL INCOME FUND II o 55
<PAGE>
-----------------------------
NOTES TO FINANCIAL STATEMENTS
-----------------------------
For the six months ended March 31, 2000, the Adviser agreed to waive all or a
portion of its fees for such services. The aggregate amounts of such fee waivers
were $46,000 for the Michigan, Minnesota and Virginia Portfolios and $23,000 for
the Arizona Portfolio. In addition, the Adviser agreed to reimburse each
Portfolio for certain operating expenses. Such expense amounted to $2,211 for
the Minnesota Portfolio. There was no such reimbursement for the Arizona
Portfolio, the Florida Portfolio, the Massachusetts Portfolio, the Michigan
Portfolio, the New Jersey Portfolio, the Ohio Portfolio, the Pennsylvania
Portfolio and the Virginia Portfolio.
Each Portfolio compensates Alliance Fund Services, Inc. (a wholly-owned
subsidiary of the Adviser) under a Transfer Agency Agreement for providing
personnel and facilities to perform transfer agency services for each Portfolio.
Such compensation amounted to: Arizona Portfolio, $13,978; Florida Portfolio,
$30,072; Massachusetts Portfolio, $23,530; Michigan Portfolio, $12,365;
Minnesota Portfolio, $11,294; New Jersey Portfolio, $35,273; Ohio Portfolio,
$23,210; Pennsylvania Portfolio, $33,603; and Virginia Portfolio, $21,558.
For the six months ended March 31, 2000, each Portfolio's expenses were reduced
under an expense offset arrangement with Alliance Fund Services as follows:
Arizona Portfolio, by $813; Florida Portfolio, by $1,694; Massachusetts
Portfolio, by $1,340; Michigan Portfolio, by $722; Minnesota Portfolio, by $661;
New Jersey Portfolio, by $1,972; Ohio Portfolio, by $1,325; Pennsylvania
Portfolio, by $1,866; and Virginia Portfolio, by $1,262.
Alliance Fund Distributors, Inc. (the "Distributor"), a wholly-owned subsidiary
of the Adviser serves as the Distributor of the Fund's shares. The Distributor
has advised the Fund that it has received front-end sales charges from sales of
Class A shares and contingent deferred sales charges imposed upon redemptions by
shareholders of Class A, Class B and Class C shares for the six months ended
March 31, 2000 as follows:
Front End Contingent Deferred Sales Charges
Sales Charges -------------------------------------------
Portfolio Class A Class A Class B Class C
-----------------------------------------------------------------------------
Arizona $ -0- $10,000 $39,435 $ 2,990
Florida -0- 6,110 67,824 8,213
Massachusetts 3,024 9,477 75,827 10,221
Michigan 7,832 -0- 21,053 2,939
Minnesota -0- 6,142 7,258 1,854
New Jersey 28,100 -0- 80,755 10,826
Ohio 102 41,250 85,816 6,497
Pennsylvania 9,194 230 44,638 17,626
Virginia -0- 10,000 69,722 5,637
--------------------------------------------------------------------------------
56 o ALLIANCE MUNICIPAL INCOME FUND II
<PAGE>
-----------------------------
NOTES TO FINANCIAL STATEMENTS
-----------------------------
NOTE C
Distribution Services Agreement
Each Portfolio has adopted a Distribution Services Agreement (the "Agreement")
pursuant to Rule 12b-1 under the Investment Company Act of 1940. Under the
Agreement, each Portfolio pays distribution and servicing fees to the
Distributor at an annual rate of up to .30 of 1% of each Portfolio's average
daily net assets attributable to Class A shares and 1% of each Portfolio's
average daily net assets attributable to both Class B and Class C shares. Such
fees are accrued daily and paid monthly. The Agreement provides that the
Distributor will use such payments in their entirety for distribution assistance
and promotional activities. The Distributor has advised the Fund that it has
incurred expenses in excess of the distribution costs reimbursed by each
Portfolio as follows:
Portfolio Class B Class C
--------------------------------------------------------------------------------
Arizona .......................... $2,240,196 $ 454,562
Florida .......................... 3,073,045 1,737,732
Massachusetts .................... 2,225,903 1,225,864
Michigan ......................... 1,568,030 1,456,459
Minnesota ........................ 1,909,301 1,175,593
New Jersey ....................... 3,681,845 1,383,701
Ohio ............................. 3,033,169 1,368,383
Pennsylvania ..................... 2,804,889 1,175,166
Virginia ......................... 2,998,024 701,267
Such costs may be recovered from each Portfolio at an annual rate of up to .30
of 1% of each Portfolio's daily net assets in future periods so long as the
Agreement is in effect. In accordance with the Agreement, there is no provision
for recovery of unreimbursed distribution costs incurred by the Distributor
beyond the current fiscal year for Class A shares. The Agreement also provides
that the Adviser may use its own resources to finance the distribution of each
Portfolio's shares.
NOTE D
Investment Transactions
Purchases and sales of investment securities (excluding short-term investments
and U.S. government securities) for the six months ended March 31, 2000 were as
follows:
Portfolio Purchases Sales
--------------------------------------------------------------------------------
Arizona ........................ $123,491,884 $115,203,920
Florida ........................ 342,901,055 347,559,272
Massachusetts .................. 316,116,993 312,677,180
Michigan ....................... 64,177,935 53,848,339
Minnesota ...................... 92,264,723 91,250,689
New Jersey ..................... 212,350,769 201,269,788
Ohio ........................... 161,549,271 164,294,879
Pennsylvania ................... 280,437,373 293,673,932
Virginia ....................... 197,528,004 188,561,394
--------------------------------------------------------------------------------
ALLIANCE MUNICIPAL INCOME FUND II o 57
<PAGE>
-----------------------------
NOTES TO FINANCIAL STATEMENTS
-----------------------------
At March 31, 2000, the cost of investments for federal income tax purposes,
gross unrealized appreciation, gross unrealized depreciation and net unrealized
appreciation (depreciation) of investments for each Portfolio were as follows:
Gross Unrealized Gross Unrealized Net Unrealized
Portfolio Tax Cost Appreciation Depreciation) Appreciation
--------------------------------------------------------------------------------
Arizona $ 81,032,700 $ 1,881,254 $ 55,880 $ 1,825,374
Florida 174,775,067 2,695,801 4,116 2,691,685
Massachusetts 108,928,431 3,285,213 -0- 3,285,213
Michigan 36,455,635 924,636 23,933 900,703
Minnesota 32,147,918 805,757 20 805,737
New Jersey 130,306,314 3,367,873 116,550 3,251,323
Ohio 86,052,596 1,731,837 -0- 1,731,837
Pennsylvania 121,065,886 3,521,681 100,442 3,421,239
Virginia 86,869,103 1,975,846 65,754 1,910,092
For Federal income tax purposes at September 30, 1999, the Fund had capital loss
carryforwards for the following Portfolios: $3,931,206 expiring in 2003 and
4,853 expiring in 2007, for Florida Portfolio; $650,584 expiring in 2003, and
$492,981 expiring in 2004, for Minnesota Portfolio; $3,041,366 expiring in 2003,
and $349,704 expiring in 2004, for New Jersey Portfolio; $2,526,402 expiring in
2003, and $332,000 expiring in 2004, for Ohio Portfolio; and $316,038 expiring
in 2003, and 1,363 expiring in 2007, for Pennsylvania Portfolio. Any net capital
losses incurred after October 31 ("Post October losses") within the taxable year
are deemed to arise on the first business day of each Portfolio's next taxable
year.
--------------------------------------------------------------------------------
58 o ALLIANCE MUNICIPAL INCOME FUND II
<PAGE>
-----------------------------
NOTES TO FINANCIAL STATEMENTS
-----------------------------
NOTE E
Shares of Beneficial Interest
There is an unlimited number of $.01 par value shares of beneficial interest
authorized for Class A, Class B and Class C shares. Transactions in shares of
beneficial interest in each Portfolio were as follows:
<TABLE>
<CAPTION>
---------------------------------- ----------------------------------
Shares Amount
---------------------------------- ----------------------------------
Six Months Ended Year Ended Six Months Ended Year Ended
March 31, 2000 September 30, March 31, 2000 September 30,
Arizona Portfolio (unaudited) 1999 (unaudited) 1999
-------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class A
Shares sold 1,241,285 2,277,927 $ 12,562,931 $ 24,623,422
-------------------------------------------------------------------------------------------------------
Shares issued in
reinvestment of
dividends and
distributions 46,203 72,186 469,842 777,242
-------------------------------------------------------------------------------------------------------
Shares converted
from Class B 18,958 19,950 194,432 215,625
-------------------------------------------------------------------------------------------------------
Shares redeemed (828,217) (588,982) (8,400,374) (6,374,579)
-------------------------------------------------------------------------------------------------------
Net increase 478,229 1,781,081 $ 4,826,831 $ 19,241,710
=======================================================================================================
Class B
Shares sold 489,490 1,905,927 $ 4,989,905 $ 20,514,932
-------------------------------------------------------------------------------------------------------
Shares issued in
reinvestment of
dividends and
distributions 37,815 51,041 384,138 548,786
-------------------------------------------------------------------------------------------------------
Shares converted
to Class A (18,958) (19,950) (194,432) (215,625)
-------------------------------------------------------------------------------------------------------
Shares redeemed (357,202) (170,811) (3,616,662) (1,824,014)
-------------------------------------------------------------------------------------------------------
Net increase 151,145 1,766,207 $ 1,562,949 $ 19,024,079
=======================================================================================================
Class C
Shares sold 164,987 552,598 $ 1,676,483 $ 5,960,967
-------------------------------------------------------------------------------------------------------
Shares issued in
reinvestment of
dividends and
distributions 11,643 16,202 118,240 174,860
-------------------------------------------------------------------------------------------------------
Shares redeemed (181,341) (93,570) (1,844,519) (1,014,099)
-------------------------------------------------------------------------------------------------------
Net increase
(decrease) (4,711) 475,230 $ (49,796) $ 5,121,728
=======================================================================================================
</TABLE>
--------------------------------------------------------------------------------
ALLIANCE MUNICIPAL INCOME FUND II o 59
<PAGE>
-----------------------------
NOTES TO FINANCIAL STATEMENTS
-----------------------------
<TABLE>
<CAPTION>
---------------------------------- ----------------------------------
Shares Amount
---------------------------------- ----------------------------------
Six Months Ended Year Ended Six Months Ended Year Ended
March 31, 2000 September 30, March 31, 2000 September 30,
Florida Portfolio (unaudited) 1999 (unaudited) 1999
-------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class A
Shares sold 1,727,335 4,938,321 $ 16,399,783 $ 50,810,230
-------------------------------------------------------------------------------------------------------
Shares issued in
reinvestment of
dividends 89,656 157,067 854,974 1,602,230
-------------------------------------------------------------------------------------------------------
Shares converted
from Class B 276,864 307,992 2,634,858 3,065,724
-------------------------------------------------------------------------------------------------------
Shares redeemed (2,732,556) (1,515,732) (25,983,692) (15,363,283)
-------------------------------------------------------------------------------------------------------
Net increase
(decrease) (638,701) 3,887,648 $ (6,094,077) $ 40,114,901
=======================================================================================================
Class B
Shares sold 1,071,407 3,874,899 $ 10,245,292 $ 39,796,253
-------------------------------------------------------------------------------------------------------
Shares issued in
reinvestment of
dividends 83,971 132,982 800,304 1,358,222
-------------------------------------------------------------------------------------------------------
Shares converted
to Class A (276,864) (307,992) (2,634,858) (3,065,724)
-------------------------------------------------------------------------------------------------------
Shares redeemed (1,036,894) (704,252) (9,845,098) (7,164,709)
-------------------------------------------------------------------------------------------------------
Net increase
(decrease) (158,380) 2,995,637 $ (1,434,360) $ 30,924,042
=======================================================================================================
Class C
Shares sold 831,543 1,798,383 $ 7,957,747 $ 18,543,697
-------------------------------------------------------------------------------------------------------
Shares issued in
reinvestment of
dividends 50,561 95,440 481,556 975,564
-------------------------------------------------------------------------------------------------------
Shares redeemed (885,904) (603,835) (8,447,724) (6,152,943)
-------------------------------------------------------------------------------------------------------
Net increase
(decrease) (3,800) 1,289,988 $ (8,421) $ 13,366,318
=======================================================================================================
</TABLE>
<TABLE>
<CAPTION>
---------------------------------- ----------------------------------
Shares Amount
---------------------------------- ----------------------------------
Six Months Ended Year Ended Six Months Ended Year Ended
March 31, 2000 September 30, March 31, 2000 September 30,
Massachusetts Portfolio (unaudited) 1999 (unaudited) 1999
-------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class A
Shares sold 3,291,102 3,312,860 $ 33,900,468 $ 37,219,332
-------------------------------------------------------------------------------------------------------
Shares issued in
reinvestment of
dividends and
distributions 63,274 114,805 653,172 1,280,006
-------------------------------------------------------------------------------------------------------
Shares converted
from Class B 28,665 18,753 297,161 202,106
-------------------------------------------------------------------------------------------------------
Shares redeemed (3,130,659) (1,268,882) (32,102,754) (14,120,578)
-------------------------------------------------------------------------------------------------------
Net increase 252,382 2,177,536 $ 2,748,047 $ 24,580,866
=======================================================================================================
</TABLE>
--------------------------------------------------------------------------------
60 o ALLIANCE MUNICIPAL INCOME FUND II
<PAGE>
-----------------------------
NOTES TO FINANCIAL STATEMENTS
-----------------------------
<TABLE>
<CAPTION>
---------------------------------- ----------------------------------
Shares Amount
---------------------------------- ----------------------------------
Six Months Ended Year Ended Six Months Ended Year Ended
March 31, 2000 September 30, March 31, 2000 September 30,
Massachusetts Portfolio (unaudited) 1999 (unaudited) 1999
-------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class B
Shares sold 411,230 2,527,508 $ 4,248,489 $ 28,165,325
-------------------------------------------------------------------------------------------------------
Shares issued in
reinvestment of
dividends and
distributions 54,195 81,618 558,019 910,840
-------------------------------------------------------------------------------------------------------
Shares converted
to Class A (28,637) (18,753) (297,161) (202,106)
-------------------------------------------------------------------------------------------------------
Shares redeemed (627,527) (378,875) (6,470,876) (4,147,852)
-------------------------------------------------------------------------------------------------------
Net increase
(decrease) (190,739) 2,211,498 $ (1,961,529) $ 24,726,207
=======================================================================================================
Class C
Shares sold 766,127 1,554,684 $ 7,840,808 $ 17,399,768
-------------------------------------------------------------------------------------------------------
Shares issued in
reinvestment of
dividends and
distributions 49,260 73,064 507,326 814,318
-------------------------------------------------------------------------------------------------------
Shares redeemed (695,351) (455,361) (7,147,536) (5,076,849)
-------------------------------------------------------------------------------------------------------
Net increase 120,036 1,172,387 $ 1,200,598 $ 13,137,237
=======================================================================================================
</TABLE>
<TABLE>
<CAPTION>
---------------------------------- ----------------------------------
Shares Amount
---------------------------------- ----------------------------------
Six Months Ended Year Ended Six Months Ended Year Ended
March 31, 2000 September 30, March 31, 2000 September 30,
Michigan Portfolio (unaudited) 1999 (unaudited) 1999
-------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class A
Shares sold 407,275 487,789 $ 3,986,329 $ 5,078,916
-------------------------------------------------------------------------------------------------------
Shares issued in
reinvestment of
dividends and
distributions 19,664 32,476 192,239 337,440
-------------------------------------------------------------------------------------------------------
Shares converted
from Class B 42,326 2,666 414,256 28,003
-------------------------------------------------------------------------------------------------------
Shares redeemed (247,289) (167,913) (2,420,791) (1,734,568)
-------------------------------------------------------------------------------------------------------
Net increase 221,976 355,018 $ 2,172,033 $ 3,709,791
=======================================================================================================
Class B
Shares sold 216,170 623,638 $ 2,104,286 $ 6,488,521
-------------------------------------------------------------------------------------------------------
Shares issued in
reinvestment of
dividends and
distributions 17,310 36,531 169,129 379,775
-------------------------------------------------------------------------------------------------------
Shares converted
to Class A (42,326) (2,666) (414,256) (28,003)
-------------------------------------------------------------------------------------------------------
Shares redeemed (254,736) (167,093) (2,478,384) (1,729,098)
-------------------------------------------------------------------------------------------------------
Net increase (decrease) (63,582) 490,410 $ (619,225) $ 5,111,195
=======================================================================================================
</TABLE>
--------------------------------------------------------------------------------
ALLIANCE MUNICIPAL INCOME FUND II o 61
<PAGE>
-----------------------------
NOTES TO FINANCIAL STATEMENTS
-----------------------------
<TABLE>
<CAPTION>
---------------------------------- ----------------------------------
Shares Amount
---------------------------------- ----------------------------------
Six Months Ended Year Ended Six Months Ended Year Ended
March 31, 2000 September 30, March 31, 2000 September 30,
Michigan Portfolio (unaudited) 1999 (unaudited) 1999
-------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class C
Shares sold 276,071 498,274 $ 2,723,895 $ 5,196,724
-------------------------------------------------------------------------------------------------------
Shares issued in
reinvestment of
dividends and
distributions 20,018 38,412 195,581 398,957
-------------------------------------------------------------------------------------------------------
Shares redeemed (249,973) (314,121) (2,448,268) (3,239,098)
-------------------------------------------------------------------------------------------------------
Net increase 46,116 222,565 $ 471,208 $ 2,356,583
=======================================================================================================
</TABLE>
<TABLE>
<CAPTION>
---------------------------------- ----------------------------------
Shares Amount
---------------------------------- ----------------------------------
Six Months Ended Year Ended Six Months Ended Year Ended
March 31, 2000 September 30, March 31, 2000 September 30,
Minnesota Portfolio (unaudited) 1999 (unaudited) 1999
-------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class A
Shares sold 543,102 497,561 $ 5,164,016 $ 5,020,946
-------------------------------------------------------------------------------------------------------
Shares issued in
reinvestment of
dividends 20,520 27,350 193,759 273,996
-------------------------------------------------------------------------------------------------------
Shares converted
from Class B 143,115 82,720 1,350,645 805,502
-------------------------------------------------------------------------------------------------------
Shares redeemed (233,394) (123,890) (2,198,595) (1,231,987)
-------------------------------------------------------------------------------------------------------
Net increase 473,343 483,741 $ 4,509,825 $ 4,868,457
=======================================================================================================
Class B
Shares sold 144,447 352,879 $ 1,368,065 $ 3,549,698
-------------------------------------------------------------------------------------------------------
Shares issued in
reinvestment of
dividends 19,654 40,642 185,684 408,744
-------------------------------------------------------------------------------------------------------
Shares converted
to Class A (143,115) (82,720) (1,350,645) (805,502)
-------------------------------------------------------------------------------------------------------
Shares redeemed (210,588) (208,063) (1,981,677) (2,072,985)
-------------------------------------------------------------------------------------------------------
Net increase
(decrease) (189,602) 102,738 $ (1,778,573) $ 1,079,955
=======================================================================================================
Class C
Shares sold 64,918 311,979 $ 612,695 $ 3,153,964
-------------------------------------------------------------------------------------------------------
Shares issued in
reinvestment of
dividends 15,035 28,240 142,055 283,659
-------------------------------------------------------------------------------------------------------
Shares redeemed (201,878) (156,007) (1,907,981) (1,570,414)
-------------------------------------------------------------------------------------------------------
Net increase
(decrease) (121,925) 184,212 $ (1,153,231) $ 1,867,209
=======================================================================================================
</TABLE>
--------------------------------------------------------------------------------
62 o ALLIANCE MUNICIPAL INCOME FUND II
<PAGE>
-----------------------------
NOTES TO FINANCIAL STATEMENTS
-----------------------------
<TABLE>
<CAPTION>
---------------------------------- ----------------------------------
Shares Amount
---------------------------------- ----------------------------------
Six Months Ended Year Ended Six Months Ended Year Ended
March 31, 2000 September 30, March 31, 2000 September 30,
New Jersey Portfolio (unaudited) 1999 (unaudited) 1999
-------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class A
Shares sold 1,540,129 1,418,607 $ 14,811,607 $ 14,654,659
-------------------------------------------------------------------------------------------------------
Shares issued in
reinvestment of
dividends 46,228 71,338 467,606 736,677
-------------------------------------------------------------------------------------------------------
Shares converted
from Class B 508,143 501,257 4,877,459 5,056,860
-------------------------------------------------------------------------------------------------------
Shares redeemed (703,489) (792,821) (6,724,358) (8,182,428)
-------------------------------------------------------------------------------------------------------
Net increase 1,391,011 1,198,381 $ 13,432,314 $ 12,265,768
=======================================================================================================
Class B
Shares sold 924,838 3,200,774 $ 8,906,978 $ 33,167,812
-------------------------------------------------------------------------------------------------------
Shares issued in
reinvestment of
dividends 94,636 162,998 909,417 1,683,868
-------------------------------------------------------------------------------------------------------
Shares converted
to Class A (508,034) (501,257) (4,877,459) (5,056,860)
-------------------------------------------------------------------------------------------------------
Shares redeemed (929,346) (914,657) (8,901,317) (9,402,931)
-------------------------------------------------------------------------------------------------------
Net increase
(decrease) (417,907) 1,947,858 $ (3,962,381) $ 20,391,889
=======================================================================================================
Class C
Shares sold 448,388 1,216,161 $ 4,326,268 $ 12,623,102
-------------------------------------------------------------------------------------------------------
Shares issued in
reinvestment of
dividends 48,839 84,996 469,390 878,529
-------------------------------------------------------------------------------------------------------
Shares redeemed (653,463) (507,784) (6,284,044) (5,232,779)
-------------------------------------------------------------------------------------------------------
Net increase
(decrease) (156,235) 793,373 $ (1,488,386) $ 8,268,852
=======================================================================================================
</TABLE>
<TABLE>
<CAPTION>
---------------------------------- ----------------------------------
Shares Amount
---------------------------------- ----------------------------------
Six Months Ended Year Ended Six Months Ended Year Ended
March 31, 2000 September 30, March 31, 2000 September 30,
Ohio Portfolio (unaudited) 1999 (unaudited) 1999
-------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class A
Shares sold 495,215 1,475,518 $ 4,737,870 $ 15,096,494
-------------------------------------------------------------------------------------------------------
Shares issued in
reinvestment of
dividends 44,451 48,567 424,587 496,061
-------------------------------------------------------------------------------------------------------
Shares converted
from Class B 398,104 290,049 3,807,706 2,897,413
-------------------------------------------------------------------------------------------------------
Shares redeemed (877,185) (412,951) (8,382,056) (4,253,626)
-------------------------------------------------------------------------------------------------------
Net increase 60,585 1,401,183 $ 588,107 $ 14,236,342
=======================================================================================================
</TABLE>
--------------------------------------------------------------------------------
ALLIANCE MUNICIPAL INCOME FUND II o 63
<PAGE>
-----------------------------
NOTES TO FINANCIAL STATEMENTS
-----------------------------
<TABLE>
<CAPTION>
---------------------------------- ----------------------------------
Shares Amount
---------------------------------- ----------------------------------
Six Months Ended Year Ended Six Months Ended Year Ended
March 31, 2000 September 30, March 31, 2000 September 30,
Ohio Portfolio (unaudited) 1999 (unaudited) 1999
-------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class B
Shares sold 585,316 2,157,546 $ 5,599,758 $ 22,134,341
-------------------------------------------------------------------------------------------------------
Shares issued in
reinvestment of
dividends 72,123 136,727 688,836 1,403,955
-------------------------------------------------------------------------------------------------------
Shares converted
to Class A (398,104) (290,049) (3,807,706) (2,897,413)
-------------------------------------------------------------------------------------------------------
Shares redeemed (808,212) (596,765) (7,667,961) (6,060,731)
-------------------------------------------------------------------------------------------------------
Net increase
(decrease) (548,877) 1,407,459 $ (5,187,073) $ 14,580,152
=======================================================================================================
Class C
Shares sold 448,864 1,196,091 $ 4,293,396 $ 12,324,925
-------------------------------------------------------------------------------------------------------
Shares issued in
reinvestment of
dividends 35,537 64,479 340,224 659,657
-------------------------------------------------------------------------------------------------------
Shares redeemed (578,755) (410,627) (5,516,072) (4,164,275)
-------------------------------------------------------------------------------------------------------
Net increase
(decrease) (94,354) 849,943 $ (882,452) $ 8,820,307
=======================================================================================================
</TABLE>
<TABLE>
<CAPTION>
---------------------------------- ----------------------------------
Shares Amount
---------------------------------- ----------------------------------
Six Months Ended Year Ended Six Months Ended Year Ended
March 31, 2000 September 30, March 31, 2000 September 30,
Pennsylvania Portfolio (unaudited) 1999 (unaudited) 1999
-------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class A
Shares sold 735,850 3,024,140 $ 7,101,517 $ 31,598,359
-------------------------------------------------------------------------------------------------------
Shares issued in
reinvestment of
dividends 102,109 150,874 981,341 1,566,915
-------------------------------------------------------------------------------------------------------
Shares converted
from Class B 334,675 477,975 3,219,427 4,823,033
-------------------------------------------------------------------------------------------------------
Shares redeemed (1,428,794) (680,929) (13,808,159) (7,066,429)
-------------------------------------------------------------------------------------------------------
Net increase
(decrease) (256,160) 2,972,060 $ (2,505,874) $ 30,921,878
=======================================================================================================
Class B
Shares sold 695,371 2,668,536 $ 6,705,043 $ 27,855,387
-------------------------------------------------------------------------------------------------------
Shares issued in
reinvestment of
dividends 65,125 122,280 626,866 1,271,826
-------------------------------------------------------------------------------------------------------
Shares converted
to Class A (334,675) (477,975) (3,219,427) (4,823,033)
-------------------------------------------------------------------------------------------------------
Shares redeemed (924,601) (756,737) (8,881,303) (7,843,288)
-------------------------------------------------------------------------------------------------------
Net increase
(decrease) (498,780) 1,556,104 $ (4,768,821) $ 16,460,892
=======================================================================================================
</TABLE>
--------------------------------------------------------------------------------
64 o ALLIANCE MUNICIPAL INCOME FUND II
<PAGE>
-----------------------------
NOTES TO FINANCIAL STATEMENTS
-----------------------------
<TABLE>
<CAPTION>
---------------------------------- ----------------------------------
Shares Amount
---------------------------------- ----------------------------------
Six Months Ended Year Ended Six Months Ended Year Ended
March 31, 2000 September 30, March 31, 2000 September 30,
Pennsylvania Portfolio (unaudited) 1999 (unaudited) 1999
-------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class C
Shares sold 358,849 1,404,524 $ 3,460,543 $ 14,722,908
-------------------------------------------------------------------------------------------------------
Shares issued in
reinvestment of
dividends 37,572 59,984 361,170 624,110
-------------------------------------------------------------------------------------------------------
Shares redeemed (857,486) (287,237) (8,208,722) (2,971,823)
-------------------------------------------------------------------------------------------------------
Net increase
(decrease) (461,065) 1,177,271 $ (4,387,009) $ 12,375,195
=======================================================================================================
</TABLE>
<TABLE>
<CAPTION>
---------------------------------- ----------------------------------
Shares Amount
---------------------------------- ----------------------------------
Six Months Ended Year Ended Six Months Ended Year Ended
March 31, 2000 September 30, March 31, 2000 September 30,
Virginia Portfolio (unaudited) 1999 (unaudited) 1999
-------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class A
Shares sold 767,657 1,961,441 $ 7,737,536 $ 20,961,953
-------------------------------------------------------------------------------------------------------
Shares issued in
reinvestment of
dividends and
distributions 40,918 64,215 412,441 684,946
-------------------------------------------------------------------------------------------------------
Shares converted
from Class B 12,330 9,212 125,273 96,919
-------------------------------------------------------------------------------------------------------
Shares redeemed (299,823) (244,939) (3,040,417) (2,603,335)
-------------------------------------------------------------------------------------------------------
Net increase 521,082 1,789,929 $ 5,234,833 $ 19,140,483
=======================================================================================================
Class B
Shares sold 726,419 2,789,674 $ 7,337,830 $ 29,989,497
-------------------------------------------------------------------------------------------------------
Shares issued in
reinvestment of
dividends and
distributions 69,919 104,702 704,214 1,116,887
-------------------------------------------------------------------------------------------------------
Shares converted
to Class A (12,347) (9,212) (125,273) (96,919)
-------------------------------------------------------------------------------------------------------
Shares redeemed (465,568) (262,985) (4,673,112) (2,787,282)
-------------------------------------------------------------------------------------------------------
Net increase 318,423 2,622,179 $ 3,243,659 $ 28,222,183
=======================================================================================================
Class C
Shares sold 419,541 979,841 $ 4,212,655 $ 10,520,143
-------------------------------------------------------------------------------------------------------
Shares issued in
reinvestment of
dividends and
distributions 22,412 29,968 225,970 319,844
-------------------------------------------------------------------------------------------------------
Shares redeemed (215,710) (170,313) (2,178,679) (1,808,191)
-------------------------------------------------------------------------------------------------------
Net increase 226,243 839,496 $ 2,259,946 $ 9,031,796
=======================================================================================================
</TABLE>
--------------------------------------------------------------------------------
ALLIANCE MUNICIPAL INCOME FUND II o 65
<PAGE>
-----------------------------
NOTES TO FINANCIAL STATEMENTS
-----------------------------
NOTE F
Bank Borrowing
A number of open-end mutual funds managed by the Adviser, including the Fund,
participate in a $750 million revolving credit facility (the "Facility")
intended to provide short-term financing if necessary, subject to certain
restrictions, in connection with abnormal redemption activity. Commitment fees
related to the Facility are paid by the participating funds and are included in
miscellaneous expenses in the statement of operations. The Fund did not utilize
the Facility during the six months ended March 31, 2000.
--------------------------------------------------------------------------------
66 o ALLIANCE MUNICIPAL INCOME FUND II
<PAGE>
--------------------
FINANCIAL HIGHLIGHTS
--------------------
FINANCIAL HIGHLIGHTS
Selected Data For A Share of Beneficial Interest Outstanding Throughout Each
Period
<TABLE>
<CAPTION>
Arizona Portfolio
----------------------------------------------------------------------------
Class A
----------------------------------------------------------------------------
Six Months
Ended
March 31, Year Ended September 30,
2000 ------------------------------------------------------------
(unaudited) 1999 1998 1997 1996 1995
----------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning of year...................... $10.40 $11.03 $10.78 $10.32 $10.29 $9.77
----------------------------------------------------------------------------
Income From Investment
Operations
Net investment income ................... (.27)(b) .51(b) .54(b) .57(b) .55(b) .56
Net realized and unrealized
gain (loss) on investment
transactions .......................... (.07) (.55) .45 .48 .14 .53
----------------------------------------------------------------------------
Net increase (decrease) in
net asset value from
operations ............................ .20 (.04) .99 1.05 .69 1.09
----------------------------------------------------------------------------
Less: Dividends and
Distributions
Dividends from net
investment income ..................... (.27) (.51) (.54) (.57) (.55) (.56)
Distributions in excess of
net investment income ................. -0- (.04) (.02) -0- (.03) (.01)
Distributions from net
realized gains ........................ -0- (.04) (.18) (.02) (.08) -0-
----------------------------------------------------------------------------
Total dividends and
distributions ......................... (.27) (.59) (.74) (.59) (.66) (.57)
----------------------------------------------------------------------------
Net asset value,
end of period ......................... $10.33 $10.40 $11.03 $10.78 $10.32 $10.29
============================================================================
Total Return
Total investment return
based on net asset
value(c) .............................. 2.04% (.45)% 9.54% 10.54% 6.84% 11.56%
Ratios/Supplemental
Data
Net assets, end of period
(000's omitted) ....................... $43,157 $38,472 $21,185 $9,225 $4,409 $2,379
Ratio to average net assets of:
Expenses, net of waivers/
reimbursements ........................ .78%(d) .78% .78% .78% .78% .78%
Expenses, before waivers/
reimbursements ...................... 1.29%(d) 1.39% 1.55% 2.71% 3.69% 4.88%
Net investment income, net
of waivers/reimbursement ............ 5.32%(d) 4.74% 4.92% 5.42% 5.33% 5.56%
Portfolio turnover rate ................. 149% 217% 45% 193% 244% 85%
</TABLE>
See footnote summary on page 93.
--------------------------------------------------------------------------------
ALLIANCE MUNICIPAL INCOME FUND II o 67
<PAGE>
--------------------
FINANCIAL HIGHLIGHTS
--------------------
Selected Data For A Share Of Beneficial Interest Outstanding Throughout Each
Period
<TABLE>
<CAPTION>
Arizona Portfolio
----------------------------------------------------------------------------
Class B
----------------------------------------------------------------------------
Six Months
Ended
March 31, Year Ended September 30,
2000 ------------------------------------------------------------
(unaudited) 1999 1998 1997 1996 1995
----------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning of year ..................... $10.39 $11.03 $10.78 $10.32 $10.29 $9.77
----------------------------------------------------------------------------
Income From Investment
Operations
Net investment income(a) ................ .24(b) .43(b) .45(b) .50(b) .47(b) .49
Net realized and unrealized
gain (loss) on investment
transactions .......................... (.07) (.55) .47 .48 .14 .53
----------------------------------------------------------------------------
Net increase (decrease) in
net asset value from
operations ............................ .17 (.12) .92 .98 .61 1.02
----------------------------------------------------------------------------
Less: Dividends and
Distributions
Dividends from net
investment income ..................... (.24) (.43) (.45) (.50) (.47) (.49)
Distributions in excess of
net investment income ................. -0- (.05) (.04) -0- (.03) (.01)
Distributions from net
realized gains ........................ -0- (.04) (.18) (.02) (.08) -0-
----------------------------------------------------------------------------
Total dividends and
distributions ......................... (.24) (.52) (.67) (.52) (.58) (.50)
----------------------------------------------------------------------------
Net asset value,
end of period ......................... $10.32 $10.39 $11.03 $10.78 $10.32 $10.29
============================================================================
Total Return
Total investment return
based on net asset value(c) ........... 1.68% (1.19)% 8.84% 9.80% 6.10% 10.78%
Ratios/Supplemental
Data
Net assets, end of period
(000's omitted) ....................... $32,595 $31,242 $13,698 $6,531 $5,199 $3,166
Ratio to average net assets of:
Expenses, net of waivers/
reimbursements ...................... 1.48%(d) 1.48% 1.48% 1.48% 1.48% 1.48%
Expenses, before waivers/
reimbursements ...................... 2.00%(d) 2.16% 2.30% 3.40% 4.40% 5.58%
Net investment income, net
of waivers/reimbursements ........... 4.62%(d) 4.05% 4.21% 4.73% 4.62% 4.89%
Portfolio turnover rate ................. 149% 217% 45% 193% 244% 85%
</TABLE>
See footnote summary on page 93.
--------------------------------------------------------------------------------
68 o ALLIANCE MUNICIPAL INCOME FUND II
<PAGE>
--------------------
FINANCIAL HIGHLIGHTS
--------------------
Selected Data For A Share Of Beneficial Interest Outstanding Throughout Each
Period
<TABLE>
<CAPTION>
Arizona Portfolio
----------------------------------------------------------------------------
Class C
----------------------------------------------------------------------------
Six Months
Ended
March 31, Year Ended September 30,
2000 ------------------------------------------------------------
(unaudited) 1999 1998 1997 1996 1995
----------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning of year ..................... $10.39 $11.03 $10.78 $10.32 $10.30 $9.77
----------------------------------------------------------------------------
Income From Investment
Operations
Net investment income(a) ................ .24(b) .43(b) .45(b) .50(b) .47(b) .49
Net realized and unrealized
gain (loss) on investment
transactions .......................... (.07) (.55) .47 .48 .13 .54
----------------------------------------------------------------------------
Net increase (decrease) in
net asset value from
operations ............................ .17 (.12) .92 .98 .60 1.03
----------------------------------------------------------------------------
Less: Dividends and
Distributions
Dividends from net
investment income ..................... (.24) (.43) (.45) (.50) (.47) (.49)
Distributions in excess of
net investment income ................. -0- (.05) (.04) -0- (.03) (.01)
Distributions from net
realized gains ........................ -0- (.04) (.18) (.02) (.08) -0-
----------------------------------------------------------------------------
Total dividends and
distributions ......................... (.24) (.52) (.67) (.52) (.58) (.50)
----------------------------------------------------------------------------
Net asset value,
end of period ......................... $10.32 $10.39 $11.03 $10.78 $10.32 $10.30
============================================================================
Total Return
Total investment return
based on net asset value(c) ........... 1.68% (1.19)% 8.83% 9.80% 6.00% 10.89%
Ratios/Supplemental
Data
Net assets, end of period
(000's omitted) ....................... $9,258 $9,368 $4,708 $1,775 $ 710 $ 481
Ratio to average net assets of:
Expenses, net of waivers/
reimbursements ...................... 1.48%(d) 1.48% 1.48% 1.48% 1.48% 1.48%
Expenses, before waivers/
reimbursements ...................... 1.99%(d) 2.17% 2.34% 3.39% 4.41% 5.58%
Net investment income, net
of waivers/reimbursements ........... 4.63%(d) 4.05% 4.19% 4.70% 4.61% 4.90%
Portfolio turnover rate ................. 149% 217% 45% 193% 244% 85%
</TABLE>
See footnote summary on page 93
--------------------------------------------------------------------------------
ALLIANCE MUNICIPAL INCOME FUND II o 69
<PAGE>
--------------------
FINANCIAL HIGHLIGHTS
--------------------
Selected Data For A Share Of Beneficial Interest Outstanding Throughout Each
Period
<TABLE>
<CAPTION>
Florida Portfolio
----------------------------------------------------------------------------
Class A
----------------------------------------------------------------------------
Six Months
Ended
March 31, Year Ended September 30,
2000 ------------------------------------------------------------
(unaudited) 1999 1998 1997 1996 1995
----------------------------------------------------------------------------
Net asset value,
<S> <C> <C> <C> <C> <C> <C>
beginning of year ..................... $ 9.81 $10.48 $10.14 $ 9.73 $ 9.58 $8.89
----------------------------------------------------------------------------
Income From Investment
Operations
Net investment income(a) ................ .27(b) .51(b) .52(b) .55(b) .54(b) .55
Net realized and unrealized
gain (loss) on investment
transactions .......................... (.20) (.65) .37 .41 .16 .69
----------------------------------------------------------------------------
Net increase (decrease) in
net asset value from
operations ............................ .07 (.14) .89 .96 .70 1.24
----------------------------------------------------------------------------
Less: Dividends and
Distributions
Dividends from net
investment income ..................... (.26) (.51) (.52) (.55) (.54) (.55)
Distributions in excess of net
investment income ..................... -0- (.02) (.03) -0- (.01) -0-
----------------------------------------------------------------------------
Total dividends and
distributions ......................... (.26) (.53) (.55) (.55) (.55) (.55)
----------------------------------------------------------------------------
Net asset value,
end of period ......................... $ 9.62 $ 9.81 $10.48 $10.14 $ 9.73 $9.58
============================================================================
Total Return
Total investment return
based on net asset value(c) ........... .81% (1.38)% 8.97% 10.14% 7.45% 14.44%
Ratios/Supplemental
Data
Net assets, end of period
(000's omitted) ....................... $72,054 $79,752 $44,440 $17,516 $14,297 $11,956
Ratio to average net assets of:
Expenses, net of waivers/
reimbursements ...................... .73%(d) .73% .73% .73% .73% .73%
Expenses, before waivers/
reimbursements ...................... 1.20%(d) 1.18% 1.27% 1.35% 1.33% 1.33%
Net investment income, net of
waivers/reimbursements .............. 5.52%(d) 4.94% 5.14% 5.58% 5.52% 5.91%
Portfolio turnover rate ................. 191% 244% 65% 204% 237% 146%
</TABLE>
See footnote summary on page 93.
--------------------------------------------------------------------------------
70 o ALLIANCE MUNICIPAL INCOME FUND II
<PAGE>
--------------------
FINANCIAL HIGHLIGHTS
--------------------
Selected Data For A Share Of Beneficial Interest Outstanding Throughout Each
Period
<TABLE>
<CAPTION>
Florida Portfolio
----------------------------------------------------------------------------
Class B
----------------------------------------------------------------------------
Six Months
Ended
March 31, Year Ended September 30,
2000 ------------------------------------------------------------
(unaudited) 1999 1998 1997 1996 1995
----------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning of year ..................... $ 9.81 $10.48 $10.14 $ 9.74 $ 9.58 $8.89
-----------------------------------------------------------------------------
Income From Investment
Operations
Net investment income(a) ................ .23(b) .43(b) .46(b) .48(b) .47(b) .47
Net realized and unrealized
gain (loss) on investment
transactions .......................... (.18) (.64) .36 .40 .17 .70
----------------------------------------------------------------------------
Net increase (decrease) in
net asset value from
operations ............................ .05 (.21) .82 .88 .64 1.17
----------------------------------------------------------------------------
Less: Dividends and
Distributions
Dividends from net
investment income ..................... (.23) (.43) (.46) (.48) (.47) (.47)
----------------------------------------------------------------------------
Distributions in excess of
net investment income ................. -0- (.03) (.02) -0- (.01) (.01)
============================================================================
Total dividends and
distributions ......................... (.23) (.46) (.48) (.48) (.48) (.48)
----------------------------------------------------------------------------
Net asset value,
end of period ......................... $ 9.63 $ 9.81 $10.48 $10.14 $ 9.74 $9.58
----------------------------------------------------------------------------
Total Return
Total investment return
based on net asset value(c) ........... .54% (2.06)% 8.22% 9.24% 6.78% 13.56%
Ratios/Supplemental
Data
Net assets, end of period
(000's omitted) ....................... $64,720 $67,532 $40,740 $24,820 $22,235 $20,660
Ratio to average net assets of:
Expenses, net of waivers/
reimbursements ...................... 1.43%(d) 1.43% 1.43% 1.43% 1.43% 1.42%
Expenses, before waivers/
reimbursements ...................... 1.90%(d) 1.91% 1.97% 2.05% 2.03% 2.03%
Net investment income, net of
waivers/reimbursements .............. 4.83%(d) 4.25% 4.46% 4.87% 4.81% 5.22%
Portfolio turnover rate ................. 191% 244% 65% 204% 237% 146%
</TABLE>
See footnote summary on page 93.
--------------------------------------------------------------------------------
ALLIANCE MUNICIPAL INCOME FUND II o 71
<PAGE>
--------------------
FINANCIAL HIGHLIGHTS
--------------------
Selected Data For A Share Of Beneficial Interest Outstanding Throughout Each
Period
<TABLE>
<CAPTION>
Florida Portfolio
----------------------------------------------------------------------------
Class C
----------------------------------------------------------------------------
Six Months
Ended
March 31, Year Ended September 30,
2000 ------------------------------------------------------------
(unaudited) 1999 1998 1997 1996 1995
----------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning of year ..................... $ 9.81 $10.48 $10.14 $ 9.74 $ 9.58 $8.89
----------------------------------------------------------------------------
Income From Investment
Operations
Net investment income(a) ................ .23(b) .43(b) .46(b) .49(b) .47(b) .47
Net realized and unrealized
gain (loss) on investment
transactions .......................... (.18) (.64) .36 .39 .17 .70
----------------------------------------------------------------------------
Net increase (decrease) in
net asset value from
operations ............................ .05 (.21) .82 .88 .64 1.17
----------------------------------------------------------------------------
Less: Dividends and
Distributions
Dividends from net
investment income ..................... (.23) (.43) (.46) (.48) (.47) (.47)
Distributions in excess of
net investment income ................. -0- (.03) (.02) -0- (.01) (.01)
----------------------------------------------------------------------------
Total dividends and
distributions ......................... (.23) (.46) (.48) (.48) (.48) (.48)
----------------------------------------------------------------------------
Net asset value,
end of period ......................... $ 9.63 $ 9.81 $10.48 $10.14 $ 9.74 $9.58
============================================================================
Total Return
Total investment return
based on net asset value(c) ........... .54% (2.06)% 8.22% 9.23% 6.78% 13.56%
Ratios/Supplemental
Data
Net assets, end of period
(000's omitted) ....................... $41,330 $42,169 $31,524 $25,722 $30,121 $30,787
Ratio to average net assets of:
Expenses, net of waivers/
reimbursements ...................... 1.43%(d) 1.43% 1.43% 1.43% 1.43% 1.42%
Expenses, before waivers/
reimbursements ...................... 1.90%(d) 1.91% 1.99% 2.03% 2.02% 2.03%
Net investment income, net of
waivers/reimbursements .............. 4.83%(d) 4.24% 4.48% 4.89% 4.81% 5.27%
Portfolio turnover rate ................. 191% 244% 65% 204% 237% 146%
</TABLE>
See footnote summary on page 93.
--------------------------------------------------------------------------------
72 o ALLIANCE MUNICIPAL INCOME FUND II
<PAGE>
--------------------
FINANCIAL HIGHLIGHTS
--------------------
Selected Data For A Share Of Beneficial Interest Outstanding Throughout Each
Period
<TABLE>
<CAPTION>
Massachusetts Portfolio
----------------------------------------------------------------------------
Class A
----------------------------------------------------------------------------
Six Months
Ended
March 31, Year Ended September 30,
2000 ------------------------------------------------------------
(unaudited) 1999 1998 1997 1996 1995
----------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning of year ..................... $10.66 $11.39 $11.19 $10.85 $10.50 $10.12
----------------------------------------------------------------------------
Income From Investment
Operations
Net investment income(a) ................ .30(b) .53(b) .54(b) .58(b) .60(b) .58
Net realized and unrealized
gain (loss) on investment
transactions .......................... (.25) (.66) .45 .57 .44 .41
----------------------------------------------------------------------------
Net increase (decrease)
in net asset value from
operations ............................ .05 (.13) .99 1.15 1.04 .99
----------------------------------------------------------------------------
Less: Dividends and
Distributions
Dividends from net
investment income ..................... (.27) (.53) (.54) (.58) (.59) (.58)
Distributions in excess of
net investment income ................. -0- (.04) (.06) (.03) (.02) (.03)
Distributions from net
realized gains ........................ -0- (.03) (.19) (.20) (.08) -0-
----------------------------------------------------------------------------
Total dividends and
distributions ......................... (.27) (.60) (.79) (.81) (.69) (.61)
----------------------------------------------------------------------------
Net asset value,
end of period ......................... $10.44 $10.66 $11.39 $11.19 $10.85 $10.50
============================================================================
Total Return
Total investment return
based on net asset value(c) ........... .61% (1.24)% 9.18% 11.14% 10.25% 10.19%
Ratios/Supplemental
Data
Net assets, end of period
(000's omitted) ....................... $46,483 $44,758 $23,026 $9,461 $3,211 $1,337
Ratio to average net assets of:
Expenses, net of waivers/
reimbursements ...................... .72%(d) .72% .72% .72% .62% .60%
Expenses, before waivers/
reimbursements ...................... 1.24%(d) 1.24% 1.51% 2.40% 3.15% 6.44%
Net investment income, net of
waivers/reimbursements .............. 5.62%(d) 4.74% 4.87% 5.40% 5.62% 5.67%
Portfolio turnover rate ................. 280% 303% 69% 134% 246% 155%
</TABLE>
See footnote summary on page 93.
--------------------------------------------------------------------------------
ALLIANCE MUNICIPAL INCOME FUND II o 73
<PAGE>
--------------------
FINANCIAL HIGHLIGHTS
--------------------
Selected Data For A Share Of Beneficial Interest Outstanding Throughout Each
Period
<TABLE>
<CAPTION>
Massachusetts Portfolio
----------------------------------------------------------------------------
Class B
----------------------------------------------------------------------------
Six Months
Ended
March 31, Year Ended September 30,
2000 ------------------------------------------------------------
(unaudited) 1999 1998 1997 1996 1995
----------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning of year ..................... $10.65 $11.38 $11.19 $10.84 $10.49 $10.12
----------------------------------------------------------------------------
Income From Investment
Operations
Net investment income(a) ................ .26(b) .45(b) .46(b) .51(b) .52(b) .52
Net realized and unrealized
gain (loss) on investment
transactions .......................... (.24) (.65) .45 .58 .45 .39
----------------------------------------------------------------------------
Net increase (decrease) in
net asset value from
operations ............................ .02 (.20) .91 1.09 .97 .91
----------------------------------------------------------------------------
Less: Dividends and
Distributions
Dividends from net
investment income ..................... (.24) (.45) (.46) (.51) (.52) (.52)
Distributions in excess of
neti nvestment income .................. -0- (.05) (.07) (.03) (.02) (.02)
Distributions from net
realized gains ........................ -0- (.03) (.19) (.20) (.08) -0-
----------------------------------------------------------------------------
Total dividends and
distributions ......................... (.24) (.53) (.72) (.74) (.62) (.54)
----------------------------------------------------------------------------
Net asset value,
end of period ......................... $10.43 $10.65 $11.38 $11.19 $10.84 $10.49
============================================================================
Total Return
Total investment return
based on net asset value(c) ........... .27% (1.87)% 8.40% 10.52% 9.52% 9.32%
Ratios/Supplemental
Data
Net assets, end of period
(000's omitted) ....................... $39,767 $42,628 $20,400 $7,230 $3,683 $1,754
Ratio to average net assets of:
Expenses, net of waivers/
reimbursements ...................... 1.42%(d) 1.42% 1.42% 1.42% 1.32% 1.30%
Expenses, before waivers/
reimbursements ...................... 1.95%(d) 1.97% 2.22% 3.07% 3.85% 7.14%
Net investment income, net of
waivers/reimbursements ................ 4.92%(d) 4.06% 4.16% 4.73% 4.93% 4.90%
Portfolio turnover rate ................. 280% 303% 69% 134% 246% 155%
</TABLE>
See footnote summary on page 93.
--------------------------------------------------------------------------------
74 o ALLIANCE MUNICIPAL INCOME FUND II
<PAGE>
--------------------
FINANCIAL HIGHLIGHTS
--------------------
Selected Data For A Share Of Beneficial Interest Outstanding Throughout Each
Period
<TABLE>
<CAPTION>
Massachusetts Portfolio
----------------------------------------------------------------------------
Class C
----------------------------------------------------------------------------
Six Months
Ended
March 31, Year Ended September 30,
2000 ------------------------------------------------------------
(unaudited) 1999 1998 1997 1996 1995
----------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning of year ..................... $10.65 $11.38 $11.19 $10.84 $10.49 $10.12
----------------------------------------------------------------------------
Income From Investment
Operations
Net investment income(a) ................ .26(b) .45(b) .47(b) .51(b) .52(b) .52
Net realized and unrealized
gain(loss) on investment
transactions .......................... (.24) (.65) .44 .58 .45 .39
----------------------------------------------------------------------------
Net increase (decrease) in
net asset value from
operations ............................ .02 (.20) .91 1.09 .97 .91
----------------------------------------------------------------------------
Less: Dividends and
Distributions
Dividends from net
investment income ..................... (.24) (.45) (.47) (.51) (.52) (.52)
Distributions in excess of
net investment income ................. -0- (.05) (.06) (.03) (.02) (.02)
Distributions from net
realized gains ........................ -0- (.03) (.19) (.20) (.08) -0-
----------------------------------------------------------------------------
Total dividends and
distributions ......................... (.24) (.53) (.72) (.74) (.62) (.54)
----------------------------------------------------------------------------
Net asset value,
end of period ......................... $10.43 $10.65 $11.38 $11.19 $10.84 $10.49
============================================================================
Total Return
Total investment return
based on net asset value(c) ........... .27% (1.87)% 8.40% 10.52% 9.52% 9.32%
Ratios/Supplemental
Data
Net assets, end of period
(000's omitted) ....................... $30,017 29,365 $18,050 $7,815 $4,514 $2,556
Ratio to average net assets of:
Expenses, net of waivers/
reimbursements ...................... 1.42%(d) 1.42% 1.42% 1.42% 1.31% 1.30%
Expenses, before waivers/
reimbursements ...................... 1.95%(d) 1.96% 2.21% 3.09% 3.84% 7.14%
Net investment income, net of
waivers/reimbursements .............. 4.93%(d) 4.05% 4.18% 4.75% 4.88% 4.85%
Portfolio turnover rate ................. 280% 303% 69% 134% 246% 155%
</TABLE>
See footnote summary on page 93.
--------------------------------------------------------------------------------
ALLIANCE MUNICIPAL INCOME FUND II o 75
<PAGE>
--------------------
FINANCIAL HIGHLIGHTS
--------------------
Selected Data For A Share Of Beneficial Interest Outstanding Throughout Each
Period
<TABLE>
<CAPTION>
Michigan Portfolio
----------------------------------------------------------------------------
Class A
----------------------------------------------------------------------------
Six Months
Ended
March 31, Year Ended September 30,
2000 ------------------------------------------------------------
(unaudited) 1999 1998 1997 1996 1995
----------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning of year ..................... $10.06 $10.62 $10.52 $10.12 $10.10 $9.35
----------------------------------------------------------------------------
Income From Investment
Operations
Net investment income(a) ................ .26(b) .46(b) .48(b) .53(b) .52(b) .52
Net realized and unrealized
gain (loss) on investment
transactions .......................... (.08) (.45) .44 .55 .22 .78
----------------------------------------------------------------------------
Net increase (decrease) in
net asset value from
operations ............................ .18 .01 .92 1.08 .74 1.30
----------------------------------------------------------------------------
Less: Dividends and
Distributions
Dividends from net
investment income ..................... (.25) (.46) (.48) (.53) (.52) (.52)
Distributions in excess of
net investment income ................. -0- (.04) (.05) (.02) (.03) (.03)
Distributions from net
realized gains ........................ -0- (.07) (.29) (.13) (.17) -0-
----------------------------------------------------------------------------
Total dividends and
distributions ......................... (.25) (.57) (.82) (.68) (.72) (.55)
----------------------------------------------------------------------------
Net asset value,
end of period ......................... $ 9.99 $10.06 $10.62 $10.52 $10.12 $10.10
============================================================================
Total Return
Total investment return
based on net asset value(c) ........... 1.88% .03% 9.08% 11.05% 7.54% 14.40%
Ratios/Supplemental
Data
Net assets, end of period
(000's omitted) ....................... $13,886 $11,760 $8,640 $5,836 $6,123 $5,158
Ratio to average net assets of:
Expenses, net of waivers/
reimbursements ...................... .96%(d) .96% .96% .96% .96% 1.36%
Expenses, before waivers/
reimbursements ...................... 1.65%(d) 1.62% 1.89% 2.46% 2.77% 3.43%
Net investment income, net of
waivers/reimbursements .............. 5.26%(d) 4.48% 4.57% 5.24% 5.21% 5.27%
Portfolio turnover rate ................. 153% 213% 134% 161% 242% 151%
</TABLE>
See footnote summary on page 93.
--------------------------------------------------------------------------------
76 o ALLIANCE MUNICIPAL INCOME FUND II
<PAGE>
--------------------
FINANCIAL HIGHLIGHTS
--------------------
Selected Data For A Share Of Beneficial Interest Outstanding Throughout Each
Period
<TABLE>
<CAPTION>
Michigan Portfolio
----------------------------------------------------------------------------
Class B
----------------------------------------------------------------------------
Six Months
Ended
March 31, Year Ended September 30,
2000 ------------------------------------------------------------
(unaudited) 1999 1998 1997 1996 1995
----------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning of year ..................... $10.05 $10.61 $10.52 $10.12 $10.10 $9.35
----------------------------------------------------------------------------
Income From Investment
Operations
Net investment income(a) ................ .23(b) .39(b) .40(b) .46(b) .45(b) .45
Net realized and unrealized
gain (loss) on investment
transactions .......................... (.09) (.45) .44 .55 .22 .78
----------------------------------------------------------------------------
Net increase (decrease) in
net asset value from
operations ............................ .14 (.06) .84 1.01 .67 1.23
----------------------------------------------------------------------------
Less: Dividends and
Distributions
Dividends from net
investment income ..................... (.21) (.39) (.40) (.46) (.45) (.45)
Distributions in excess of
net investment income ................. -0- (.04) (.06) (.02) (.03) (.03)
Distributions from net
realized gains ........................ -0- (.07) (.29) (.13) (.17) -0-
----------------------------------------------------------------------------
Total dividends and
distributions ......................... (.21) (.50) (.75) (.61) (.65) (.48)
----------------------------------------------------------------------------
Net asset value,
end of period ......................... $ 9.98 $10.05 $10.61 $10.52 $10.12 $10.10
============================================================================
Total Return
Total investment return based on
net asset value(c) .................... 1.52% (.64)% 8.26% 10.30% 6.80% 13.58%
Ratios/Supplemental
Data
Net assets, end of period
(000's omitted) ....................... $13,104 $13,844 $9,411 $5,300 $3,553 $2,424
Ratio to average net assets of:
Expenses, net of waivers/
reimbursements ...................... 1.66%(d) 1.66% 1.66% 1.66% 1.66% 2.06%
Expenses, before waivers/
reimbursements ...................... 2.36%(d) 2.44% 2.61% 3.23% 3.48% 4.12%
Net investment income, net of
waivers/reimbursements .............. 4.55%(d) 3.79% 3.87% 4.53% 4.51% 4.57%
Portfolio turnover rate ................. 153% 213% 134% 161% 242% 151%
</TABLE>
See footnote summary on page 93.
--------------------------------------------------------------------------------
ALLIANCE MUNICIPAL INCOME FUND II o 77
<PAGE>
--------------------
FINANCIAL HIGHLIGHTS
--------------------
Selected Data For A Share Of Beneficial Interest Outstanding Throughout Each
Period
<TABLE>
<CAPTION>
Michigan Portfolio
----------------------------------------------------------------------------
Class C
----------------------------------------------------------------------------
Six Months
Ended
March 31, Year Ended September 30,
2000 ------------------------------------------------------------
(unaudited) 1999 1998 1997 1996 1995
----------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning of year ..................... $10.05 $10.61 $10.52 $10.12 $10.10 $9.35
----------------------------------------------------------------------------
Income From Investment
Operations
Net investment income(a) ................ .23(b) .40(b) .41(b) .46(b) .45(b) .45
Net realized and unrealized
gain (loss) on investment
transactions .......................... (.09) (.46) .43 .55 .22 .78
----------------------------------------------------------------------------
Net increase (decrease) in
net asset value from
operations ............................ .14 (.06) .84 1.01 .67 1.23
----------------------------------------------------------------------------
Less: Dividends and
Distributions
Dividends from net
investment income ..................... (.21) (.40) (.41) (.46) (.45) (.45)
Distributions in excess of net
investment income ..................... -0- (.03) (.05) (.02) (.03) (.03)
Distributions from net
realized gains ........................ -0- (.07) (.29) (.13) (.17) -0-
----------------------------------------------------------------------------
Total dividends and
distributions ......................... (.21) (.50) (.75) (.61) (.65) (.48)
----------------------------------------------------------------------------
Net asset value,
end of period ......................... $ 9.98 $10.05 $10.61 $10.52 $10.12 $10.10
============================================================================
Total Return
Total investment return
based on net asset value(c) ........... 1.52% (.64)% 8.26% 10.30% 6.80% 13.58%
Ratios/Supplemental
Data
Net assets, end of period
(000's omitted) ....................... $11,125 $10,747 $8,983 $5,089 $3,940 $2,886
Ratio to average net assets of:
Expenses, net of waivers/
reimbursements ...................... 1.66%(d) 1.66% 1.66% 1.66% 1.66% 2.06%
Expenses, before waivers/
reimbursements ...................... 2.36%(d) 2.43% 2.59% 3.20% 3.48% 4.13%
Net investment income, net of
waivers/reimbursements .............. 4.57%(d) 3.78% 3.88% 4.55% 4.50% 4.69%
Portfolio turnover rate ................. 153% 213% 134% 161% 242% 151%
</TABLE>
See footnote summary on page 93.
--------------------------------------------------------------------------------
78 o ALLIANCE MUNICIPAL INCOME FUND II
<PAGE>
--------------------
FINANCIAL HIGHLIGHTS
--------------------
Selected Data For A Share Of Beneficial Interest Outstanding Throughout Each
Period
<TABLE>
<CAPTION>
Minnesota Portfolio
----------------------------------------------------------------------------
Class A
----------------------------------------------------------------------------
Six Months
Ended
March 31, Year Ended September 30,
2000 ------------------------------------------------------------
(unaudited) 1999 1998 1997 1996 1995
----------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning of year ..................... $ 9.67 $10.22 $ 9.97 $ 9.58 $ 9.49 $9.19
----------------------------------------------------------------------------
Income From Investment
Operations
Net investment income(a) ................ .27(b) .49(b) .50(b) .53(b) .53(b) .53
Net realized and unrealized
gain (loss) on investment
transactions .......................... (.10) (.53) .27 .39 .11 .32
----------------------------------------------------------------------------
Net increase (decrease) in
net asset value from
operations ............................ .17 (.04) .77 .92 .64 .85
----------------------------------------------------------------------------
Less: Dividends and
Distributions
Dividends from net
investment income ..................... (.25) (.49) (.50) (.53) (.53) (.53)
Distributions in excess of
net investment income ................. -0- (.02) (.02) -0- (.02) (.02)
----------------------------------------------------------------------------
Total dividends and
distributions ......................... (.25) (.51) (.52) (.53) (.55) (.55)
----------------------------------------------------------------------------
Net asset value,
end of period ......................... $ 9.59 $ 9.67 $10.22 $ 9.97 $ 9.58 $9.49
============================================================================
Total Return
Total investment return
based on net asset value(c) ........... 1.88% (.48)% 7.94% 9.93% 6.95% 9.63%
Ratios/Supplemental
Data
Net assets, end of period
(000's omitted) ....................... $15,060 $10,601 $6,261 $4,120 $3,165 $2,414
Ratio to average net assets of:
Expenses, net of waivers/
reimbursements ...................... .75%(d) .75% .75% .75% .72% .71%
Expenses, before waivers/
reimbursements ...................... 1.65%(d) 1.63% 1.80% 2.22% 2.19% 2.30%
Net investment income, net of
waivers/reimbursements .............. 5.52%(d) 4.90% 4.92% 5.44% 5.54% 5.71%
Portfolio turnover rate ................. 269% 259% 30% 131% 195% 117%
</TABLE>
See footnote summary on page 93.
--------------------------------------------------------------------------------
ALLIANCE MUNICIPAL INCOME FUND II o 79
<PAGE>
--------------------
FINANCIAL HIGHLIGHTS
--------------------
Selected Data For A Share Of Beneficial Interest Outstanding Throughout Each
Period
<TABLE>
<CAPTION>
Minnesota Portfolio
----------------------------------------------------------------------------
Class B
----------------------------------------------------------------------------
Six Months
Ended
March 31, Year Ended September 30,
2000 ------------------------------------------------------------
(unaudited) 1999 1998 1997 1996 1995
----------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning of year ..................... $ 9.67 $10.22 $ 9.97 $ 9.58 $ 9.49 $9.18
----------------------------------------------------------------------------
Income From Investment
Operations
Net investment income(a) ................ .23(b) .42(b) .42(b) .46(b) .46(b) .46
Net realized and unrealized
gain (loss) on investment
transactions .......................... (.09) (.53) .28 .39 .11 .33
----------------------------------------------------------------------------
Net increase (decrease) in
net asset value from
operations ............................ .14 (.11) .70 .85 .57 .79
----------------------------------------------------------------------------
Less: Dividends and
Distributions
Dividends from net
investment income ..................... (.22) (.42) (.42) (.46) (.46) (.46)
Distributions in excess of
net investment income ................. -0- (.02) (.03) -0- (.02) (.02)
----------------------------------------------------------------------------
Total dividends and
distributions ......................... (.22) (.44) (.45) (.46) (.48) (.48)
----------------------------------------------------------------------------
Net asset value,
end of period ......................... $ 9.59 $ 9.67 $10.22 $ 9.97 $ 9.58 $9.49
============================================================================
Total Return
Total investment return
based on net asset value(c) ........... 1.49% (1.19)% 7.17% 9.13% 6.15% 8.90%
Ratios/Supplemental
Data
Net assets, end of period
(000's omitted) ....................... $12,187 $14,111 $13,867 $8,517 $8,291 $7,299
Ratio to average net assets of:
Expenses, net of waivers/
reimbursements ...................... 1.46%(d) 1.46% 1.46% 1.46% 1.42% 1.42%
Expenses, before waivers/
reimbursements ...................... 2.42%(d) 2.43% 2.52% 2.91% 2.89% 3.02%
Net investment income, net of
waivers/reimbursements .............. 4.74%(d) 4.16% 4.19% 4.75% 4.82% 4.97%
Portfolio turnover rate ................. 269% 259% 30% 131% 195% 117%
</TABLE>
See footnote summary on page 93.
--------------------------------------------------------------------------------
80 o ALLIANCE MUNICIPAL INCOME FUND II
<PAGE>
--------------------
FINANCIAL HIGHLIGHTS
--------------------
Selected Data For A Share Of Beneficial Interest Outstanding Throughout Each
Period
<TABLE>
<CAPTION>
Minnesota Portfolio
----------------------------------------------------------------------------
Class C
----------------------------------------------------------------------------
Six Months
Ended
March 31, Year Ended September 30,
2000 ------------------------------------------------------------
(unaudited) 1999 1998 1997 1996 1995
----------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning of year ..................... $ 9.67 $10.22 $ 9.97 $ 9.58 $ 9.50 $9.19
----------------------------------------------------------------------------
Income From Investment
Operations
Net investment income(a) ................ .23(b) .42(b) .43(b) .46(b) .46(b) .46
Net realized and unrealized
gain (loss) on investment
transactions .......................... (.08) (.53) .27 .39 .10 .33
----------------------------------------------------------------------------
Net increase (decrease) in
net asset value from
operations ............................ .15 (.11) .70 .85 .56 .79
----------------------------------------------------------------------------
Less: Dividends and
Distributions
Dividends from net
investment income ..................... (.22) (.42) (.43) (.46) (.46) (.46)
Distributions in excess of
net investment income ................. -0- (.02) (.02) -0- (.02) (.02)
----------------------------------------------------------------------------
Total dividends and
distributions ......................... (.22) (.44) (.45) (.46) (.48) (.48)
----------------------------------------------------------------------------
Net asset value,
end of period ......................... $ 9.60 $ 9.67 $10.22 $ 9.97 $ 9.58 $9.50
============================================================================
Total Return
Total investment return
based on net asset value(c) ........... 1.60% (1.19)% 7.18% 9.13% 6.03% 8.89%
Ratios/Supplemental
Data
Net assets, end of period
(000's omitted) ..................... $7,843 $9,081 $7,716 $7,358 $6,553 $7,305
Ratio to average net assets of:
Expenses, net of waivers/
reimbursements ...................... 1.45%(d) 1.45% 1.45% 1.45% 1.41% 1.41%
Expenses, before waivers/
reimbursements ...................... 2.38%(d) 2.44% 2.48% 2.89% 2.88% 3.00%
Net investment income, net of
waivers/reimbursements .............. 4.78%(d) 4.17% 4.23% 4.76% 4.82% 5.05%
Portfolio turnover rate ................. 269% 259% 30% 131% 195% 117%
</TABLE>
See footnote summary on page 93.
--------------------------------------------------------------------------------
ALLIANCE MUNICIPAL INCOME FUND II o 81
<PAGE>
--------------------
FINANCIAL HIGHLIGHTS
--------------------
Selected Data For A Share Of Beneficial Interest Outstanding Throughout Each
Period
<TABLE>
<CAPTION>
New Jersey Portfolio
----------------------------------------------------------------------------
Class A
----------------------------------------------------------------------------
Six Months
Ended
March 31, Year Ended September 30,
2000 ------------------------------------------------------------
(unaudited) 1999 1998 1997 1996 1995
----------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning of year ..................... $ 9.93 $10.46 $10.15 $ 9.72 $ 9.65 $9.07
----------------------------------------------------------------------------
Income From Investment
Operations
Net investment income(a) ................ .26(b) .49(b) .51(b) .51(b) .51(b) .54
Net realized and unrealized
gain (loss) on investment
transactions .......................... (.22) (.51) .32 .44 .11 .59
----------------------------------------------------------------------------
Net increase (decrease) in
net asset value from
operations ............................ .04 (.02) .83 .95 .62 1.13
----------------------------------------------------------------------------
Less: Dividends and
Distributions
Dividends from net
investment income ..................... (.25) (.49) (.51) (.51) (.51) (.54)
Distributions in excess of
net investment income ................. -0- (.02) (.01) (.01) (.04) (.01)
----------------------------------------------------------------------------
Total dividends and
distributions ......................... (.25) (.51) (.52) (.52) (.55) (.55)
----------------------------------------------------------------------------
Net asset value,
end of period ......................... $ 9.72 $ 9.93 $10.46 $10.15 $ 9.72 $9.65
============================================================================
Total Return
Total investment return
based on net asset value(c) .......... .46% (.29)% 8.36% 10.01% 6.57% 12.91%
Ratios/Supplemental
Data
Net assets, end of period
(000's omitted) ..................... $45,937 $33,109 $22,333 $16,309 $15,520 $11,612
Ratio to average net assets of:
Expenses, net of waivers/
reimbursements ...................... .82%(d) .82% .82% .82% .82% .82%
Expenses, before waivers/
reimbursements ...................... 1.22%(d) 1.25% 1.29% 1.34% 1.35% 1.35%
Net investment income, net of
waivers/reimbursements .............. 5.37%(d) 4.82% 4.93% 5.16% 5.26% 5.73%
Portfolio turnover rate ................. 155% 131% 35% 61% 132% 86%
</TABLE>
See footnote summary on page 93.
--------------------------------------------------------------------------------
82 o ALLIANCE MUNICIPAL INCOME FUND
<PAGE>
--------------------
FINANCIAL HIGHLIGHTS
--------------------
Selected Data For A Share Of Beneficial Interest Outstanding Throughout Each
Period
<TABLE>
<CAPTION>
New Jersey Portfolio
----------------------------------------------------------------------------
Class B
----------------------------------------------------------------------------
Six Months
Ended
March 31, Year Ended September 30,
2000 ------------------------------------------------------------
(unaudited) 1999 1998 1997 1996 1995
----------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning of year ..................... $ 9.93 $10.46 $10.16 $ 9.72 $ 9.66 $9.07
----------------------------------------------------------------------------
Income From Investment
Operations
Net investment income(a) ................ .23(b) .42(b) .43(b) .44(b) .44(b) .47
Net realized and unrealized
gain (loss) on investment
transactions .......................... (.23) (.51) .32 .45 .10 .60
----------------------------------------------------------------------------
Net increase (decrease) in
net asset value from
operations ............................ -0- (.09) .75 .89 .54 1.07
----------------------------------------------------------------------------
Less: Dividends and
Distributions
Dividends from net
investment income ..................... (.21) (.42) (.43) (.44) (.45) (.47)
Distributions in excess of
net investment income ................. -0- (.02) (.02) (.01) (.03) (.01)
----------------------------------------------------------------------------
Total dividends and
distributions ......................... (.21) (.44) (.45) (.45) (.48) (.48)
----------------------------------------------------------------------------
Net asset value,
end of period ......................... $ 9.72 $ 9.93 $10.46 $10.16 $ 9.72 $9.66
============================================================================
Total Return
Total investment return
based on net asset value(c) ........... .08% (.99)% 7.50% 9.32% 5.66% 12.15%
Ratios/Supplemental
Data
Net assets, end of period
(000's omitted) ..................... $59,519 $64,929 $48,027 $38,308 $39,099 $34,695
Ratio to average net assets of:
Expenses, net of waivers/
reimbursements ...................... 1.53%(d) 1.53% 1.53% 1.53% 1.53% 1.53%
Expenses, before waivers/
reimbursements ...................... 1.93%(d) 1.99% 2.00% 2.04% 2.05% 2.06%
Net investment income, net of
waivers/reimbursements .............. 4.63%(d) 4.10% 4.23% 4.45% 4.56% 5.03%
Portfolio turnover rate ................. 155% 131% 35% 61% 132% 86%
</TABLE>
See footnote summary on page 93.
--------------------------------------------------------------------------------
ALLIANCE MUNICIPAL INCOME FUND II o 83
<PAGE>
--------------------
FINANCIAL HIGHLIGHTS
--------------------
Selected Data For A Share Of Beneficial Interest Outstanding Throughout Each
Period
<TABLE>
<CAPTION>
New Jersey Portfolio
----------------------------------------------------------------------------
Class C
----------------------------------------------------------------------------
Six Months
Ended
March 31, Year Ended September 30,
2000 ------------------------------------------------------------
(unaudited) 1999 1998 1997 1996 1995
----------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning of year ..................... $ 9.93 $10.46 $10.16 $ 9.72 $ 9.66 $9.07
----------------------------------------------------------------------------
Income From Investment
Operations
Net investment income(a) ................ .23(b) .43(b) .43(b) .44(b) .44(b) .47
Net realized and unrealized
gain (loss) on investment
transactions .......................... (.22) (.52) .32 .45 .10 .60
----------------------------------------------------------------------------
Net increase (decrease) in
net asset value from
operations ............................ .01 (.09) .75 .89 .54 1.07
----------------------------------------------------------------------------
Less: Dividends and
Distributions
Dividends from net
investment income ..................... (.21) (.43) (.43) (.44) (.45) (.47)
Distributions in excess of
net investment income ................. -0- (.01) (.02) (.01) (.03) (.01)
----------------------------------------------------------------------------
Total dividends and
distributions ......................... (.21) (.44) (.45) (.45) (.48) (.48)
----------------------------------------------------------------------------
Net asset value,
end of period ......................... $ 9.73 $ 9.93 $10.46 $10.16 $ 9.72 $9.66
============================================================================
Total Return
Total investment return
based on net asset value(c) ........... .18% (.99)% 7.50% 9.32% 5.66% 12.14%
Ratios/Supplemental
Data
Net assets, end of period
(000's omitted) ..................... $30,381 $32,578 $26,018 $21,404 $22,579 $21,255
Ratio to average net assets of:
Expenses, net of waivers/
reimbursements ...................... 1.52%(d) 1.52% 1.52% 1.52% 1.52% 1.52%
Expenses, before waivers/
reimbursements ...................... 1.92%(d) 1.98% 1.99% 2.03% 2.04% 2.06%
Net investment income, net of
waivers/reimbursements .............. 4.64%(d) 4.12% 4.23% 4.47% 4.56% 5.09%
Portfolio turnover rate ................. 155% 131% 35% 61% 132% 86%
</TABLE>
See footnote summary on page 93.
--------------------------------------------------------------------------------
84 o ALLIANCE MUNICIPAL INCOME FUND II
<PAGE>
--------------------
FINANCIAL HIGHLIGHTS
--------------------
Selected Data For A Share Of Beneficial Interest Outstanding Throughout Each
Period
<TABLE>
<CAPTION>
Ohio Portfolio
----------------------------------------------------------------------------
Class A
----------------------------------------------------------------------------
Six Months
Ended
March 31, Year Ended September 30,
2000 ------------------------------------------------------------
(unaudited) 1999 1998 1997 1996 1995
----------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning of year ..................... $ 9.86 $10.45 $10.16 $ 9.61 $ 9.53 $9.06
----------------------------------------------------------------------------
Income From Investment
Operations
Net investment income(a) ................ .27(b) .49(b) .52(b) .54(b) .52(b) .54
Net realized and unrealized
gain (loss) on investment
transactions .......................... (.24) (.55) .30 .54 .11 .48
----------------------------------------------------------------------------
Net increase (decrease) in
net asset value from
operations ............................ .03 (.06) .82 1.08 .63 1.02
----------------------------------------------------------------------------
Less: Dividends and
Distributions
Dividends from net
investment income .................... (.26) (.49) (.52) (.53) (.53) (.54)
Distributions in excess of
net investment income ................. -0- (.04) (.01) -0- (.02) (.01)
----------------------------------------------------------------------------
Total dividends and
distributions ......................... (.26) (.53) (.53) (.53) (.55) (.55)
----------------------------------------------------------------------------
Net asset value,
end of period ......................... $ 9.63 $ 9.86 $10.45 $10.16 $ 9.61 $9.53
============================================================================
Total Return
Total investment return
based on net asset value(c) ........... .33% (.70)% 8.30% 11.60% 6.72% 11.63%
Ratios/Supplemental
Data
Net assets, end of period
(000's omitted) ..................... $27,192 $27,229 $14,220 $7,596 $6,054 $4,170
Ratio to average net assets of:
Expenses, net of waivers/
reimbursements ...................... .75%(d) .75% .75% .75% .75% .75%
Expenses, before waivers/
reimbursements ...................... 1.29%(d) 1.30% 1.35% 1.52% 1.48% 1.51%
Net investment income, net of
waivers/reimbursements .............. 5.48%(d) 4.88% 5.05% 5.49% 5.47% 5.74%
Portfolio turnover rate ................. 173% 208% 16% 104% 182% 108%
</TABLE>
See footnote summary on page 93.
--------------------------------------------------------------------------------
ALLIANCE MUNICIPAL INCOME FUND II o 85
<PAGE>
--------------------
FINANCIAL HIGHLIGHTS
--------------------
Selected Data For A Share Of Beneficial Interest Outstanding Throughout Each
Period
<TABLE>
<CAPTION>
Ohio Portfolio
----------------------------------------------------------------------------
Class B
----------------------------------------------------------------------------
Six Months
Ended
March 31, Year Ended September 30,
2000 ------------------------------------------------------------
(unaudited) 1999 1998 1997 1996 1995
----------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning of year ..................... $ 9.86 $10.45 $10.16 $ 9.61 $ 9.54 $9.06
----------------------------------------------------------------------------
Income From Investment
Operations
Net investment income(a) ................ .23(b) .43(b) .45(b) .48(b) .46(b) .47
Net realized and unrealized
gain (loss) on investment
transactions .......................... (.23) (.57) .30 .53 .09 .49
----------------------------------------------------------------------------
Net increase (decrease) in
net asset value from
operations ............................ -0- (.14) .75 1.01 .55 .96
----------------------------------------------------------------------------
Less: Dividends and
Distributions
Dividends from net
investment income ..................... (.22) (.43) (.45) (.46) (.46) (.47)
Distributions in excess of
net investment income ................. -0- (.02) (.01) -0- (.02) (.01)
----------------------------------------------------------------------------
Total dividends and
distributions ......................... (.22) (.45) (.46) (.46) (.48) (.48)
----------------------------------------------------------------------------
Net asset value,
end of period ......................... $ 9.64 $ 9.86 $10.45 $10.16 $ 9.61 $9.54
============================================================================
Total Return
Total investment return
based on net asset value(c) ........... .06% (1.38)% 7.56% 10.80% 5.82% 10.88%
Ratios/Supplemental
Data
Net assets, end of period
(000's omitted) ..................... $42,660 $49,055 $37,289 $26,821 $25,334 $21,821
Ratio to average net assets of:
Expenses, net of waivers/
reimbursements ...................... 1.46%(d) 1.46% 1.46% 1.46% 1.46% 1.46%
Expenses, before waivers/
reimbursements ...................... 2.00%(d) 2.01% 2.05% 2.22% 2.18% 2.21%
Net investment income, net of
waivers/reimbursements .............. 4.77%(d) 4.17% 4.34% 4.81% 4.77% 5.08%
Portfolio turnover rate ................. 173% 208% 16% 104% 182% 108%
</TABLE>
See footnote summary on page 93.
--------------------------------------------------------------------------------
86 o ALLIANCE MUNICIPAL INCOME FUND II
<PAGE>
--------------------
FINANCIAL HIGHLIGHTS
--------------------
Selected Data For A Share Of Beneficial Interest Outstanding Throughout Each
Period
<TABLE>
<CAPTION>
Ohio Portfolio
----------------------------------------------------------------------------
Class C
----------------------------------------------------------------------------
Six Months
Ended
March 31, Year Ended September 30,
2000 ------------------------------------------------------------
(unaudited) 1999 1998 1997 1996 1995
----------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning of year ..................... $ 9.86 $10.45 $10.16 $ 9.61 $ 9.54 $9.06
----------------------------------------------------------------------------
Income From Investment
Operations
Net investment income(a) ................ .23(b) .43(b) .45(b) .47(b) .46(b) .47
Net realized and unrealized
gain (loss) on investment
transactions .......................... (.23) (.57) .30 .54 .09 .49
----------------------------------------------------------------------------
Net increase (decrease) in
net asset value from
operations ............................ -0- (.14) .75 1.01 .55 .96
Less: Dividends and
Distributions
Dividends from net
investment income ..................... (.22) (.43) (.45) (.46) (.46) (.47)
Distributions in excess of
net investment income ................. -0- (.02) (.01) -0- (.02) (.01)
----------------------------------------------------------------------------
Total dividends and
distributions ......................... (.22) (.45) (.46) (.46) (.48) (.48)
----------------------------------------------------------------------------
Net asset value,
end of period ......................... $ 9.64 $ 9.86 $10.45 $10.16 $ 9.61 $9.54
============================================================================
Total Return
Total investment return
based on net asset value(c) ........... .06% (1.38)% 7.56% 10.80% 5.82% 10.88%
Ratios/Supplemental
Data
Net assets, end of period
(000's omitted) ..................... $22,672 $24,126 $16,685 $14,878 $17,203 $18,874
Ratio to average net assets of:
Expenses, net of waivers/
reimbursements ...................... 1.45%(d) 1.45% 1.45% 1.45% 1.45% 1.45%
Expenses, before waivers/
reimbursements ...................... 1.99%(d) 2.01% 2.04% 2.20% 2.16% 2.20%
Net investment income, net of
waivers/reimbursements .............. 4.78%(d) 4.18% 4.36% 4.81% 4.78% 5.14%
Portfolio turnover rate ................. 173% 208% 16% 104% 182% 108%
</TABLE>
See footnote summary on page 93.
--------------------------------------------------------------------------------
ALLIANCE MUNICIPAL INCOME FUND II o 87
<PAGE>
--------------------
FINANCIAL HIGHLIGHTS
--------------------
Selected Data For A Share Of Beneficial Interest Outstanding Throughout Each
Period
<TABLE>
<CAPTION>
Pennsylvania Portfolio
----------------------------------------------------------------------------
Class A
----------------------------------------------------------------------------
Six Months
Ended
March 31, Year Ended September 30,
2000 ------------------------------------------------------------
(unaudited) 1999 1998 1997 1996 1995
----------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning of year ..................... $ 9.89 $10.66 $10.33 $ 9.85 $ 9.64 $9.18
----------------------------------------------------------------------------
Income From Investment
Operations
Net investment income(a) ................ .26(b) .49(b) .53(b) .55(b) .49(b) .54
Net realized and unrealized
gain (loss) on investment
transactions .......................... (.13) (.73) .35 .49 .28 .48
----------------------------------------------------------------------------
Net increase (decrease) in
net asset value from
operations ............................ .13 (.24) .88 1.04 .77 1.02
----------------------------------------------------------------------------
Less: Dividends and
Distributions
Dividends from net
investment income ..................... (.26) (.49) (.53) (.55) (.53) (.54)
Distributions in excess of
net investment income ................. -0- (.04) (.02) (.01) (.03) (.02)
----------------------------------------------------------------------------
Total dividends and
distributions ......................... (.26) (.53) (.55) (.56) (.56) (.56)
----------------------------------------------------------------------------
Net asset value,
end of period ......................... $ 9.76 $ 9.89 $10.66 $10.33 $ 9.85 $9.64
============================================================================
Total Return
Total investment return
based on net asset value(c) ........... 1.37% (2.43)% 8.72% 10.85% 8.17% 11.53%
Ratios/Supplemental
Data
Net assets, end of period
(000's omitted) ....................... $59,155 $62,479 $35,632 $24,948 $21,104 $8,721
Ratio to average net assets of:
Expenses, net of waivers/
reimbursements ...................... .95%(d) .95% .95% .95% 1.00% 1.00%
Expenses, before waivers/
reimbursements ...................... 1.22%(d) 1.24% 1.29% 1.40% 1.45% 1.47%
Net investment income, net of
waivers/reimbursements .............. 5.44%(d) 4.68% 5.10% 5.44% 5.40% 5.78%
Portfolio turnover rate ................. 216% 249% 70% 85% 185% 114%
</TABLE>
See footnote summary on page 93.
--------------------------------------------------------------------------------
88 o ALLIANCE MUNICIPAL INCOME FUND II
<PAGE>
--------------------
FINANCIAL HIGHLIGHTS
--------------------
Selected Data For A Share Of Beneficial Interest Outstanding Throughout Each
Period
<TABLE>
<CAPTION>
Pennsylvania Portfolio
----------------------------------------------------------------------------
Class B
----------------------------------------------------------------------------
Six Months
Ended
March 31, Year Ended September 30,
2000 ------------------------------------------------------------
(unaudited) 1999 1998 1997 1996 1995
----------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning of year ..................... $ 9.89 $10.66 $10.33 $ 9.86 $ 9.65 $9.18
----------------------------------------------------------------------------
Income From Investment
Operations
Net investment income(a) ................ .23(b) .41(b) .46(b) .47(b) .46(b) .47
Net realized and unrealized
gain (loss) on investment
transactions .......................... (.14) (.73) .34 .49 .24 .49
----------------------------------------------------------------------------
Net increase (decrease) in
net asset value from
operations ............................ .09 (.32) .80 .96 .70 .96
----------------------------------------------------------------------------
Less: Dividends and
Distributions
Dividends from net
investment income ..................... (.22) (.41) (.46) (.47) (.46) (.47)
Distributions in excess of
net investment income ................. -0- (.04) (.01) (.02) (.03) (.02)
----------------------------------------------------------------------------
Total dividends and
distributions ......................... (.22) (.45) (.47) (.49) (.49) (.49)
----------------------------------------------------------------------------
Net asset value,
end of period ......................... $ 9.76 $ 9.89 $10.66 $10.33 $ 9.86 $9.65
============================================================================
Total Return
Total investment return
based on net asset value(c) ........... .99% (3.10)% 7.98% 9.95% 7.38% 10.78%
Ratios/Supplemental
Data
Net assets, end of period
(000's omitted) ....................... $46,477 $52,012 $39,465 $30,078 $30,440 $28,559
Ratio to average net assets of:
Expenses, net of waivers/
reimbursements ...................... 1.66%(d) 1.66% 1.66% 1.66% 1.71% 1.71%
Expenses, before waivers/
reimbursements ...................... 1.93%(d) 1.98% 2.00% 2.09% 2.15% 2.17%
Net investment income, net of
waivers/reimbursements .............. 4.72%(d) 3.96% 4.39% 4.72% 4.69% 5.09%
Portfolio turnover rate ................. 216% 249% 70% 85% 185% 114%
</TABLE>
See footnote summary on page 93.
--------------------------------------------------------------------------------
ALLIANCE MUNICIPAL INCOME FUND II o 89
<PAGE>
--------------------
FINANCIAL HIGHLIGHTS
--------------------
Selected Data For A Share Of Beneficial Interest Outstanding Throughout Each
Period
<TABLE>
<CAPTION>
Pennsylvania Portfolio
----------------------------------------------------------------------------
Class C
----------------------------------------------------------------------------
Six Months
Ended
March 31, Year Ended September 30,
2000 ------------------------------------------------------------
(unaudited) 1999 1998 1997 1996 1995
----------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning of year ..................... $ 9.89 $10.66 $10.33 $ 9.86 $ 9.65 $9.18
----------------------------------------------------------------------------
Income From Investment
Operations
Net investment income(a) ................ .23(b) .41(b) .46(b) .47(b) .46(b) .47
Net realized and unrealized
gain (loss) on investment
transactions .......................... (.14) (.73) .34 .49 .24 .49
----------------------------------------------------------------------------
Net increase (decrease) in
net asset value from
operations ............................ .09 (.32) .80 .96 .70 .96
----------------------------------------------------------------------------
Less: Dividends and
Distributions
Dividends from net
investment income ..................... (.22) (.41) (.46) (.47) (.46) (.47)
Distributions in excess of
net investment income ................. -0- (.04) (.01) (.02) (.03) (.02)
----------------------------------------------------------------------------
Total dividends and
distributions ......................... (.22) (.45) (.47) (.49) (.49) (.49)
----------------------------------------------------------------------------
Net asset value,
end of period ......................... $ 9.76 $ 9.89 $10.66 $10.33 $ 9.86 $9.65
============================================================================
Total Return
Total investment return
based on net asset value(c) ........... .99% (3.10)% 7.98% 9.95% 7.37% 10.78%
Ratios/Supplemental
Data
Net assets, end of period
(000's omitted) ....................... $23,051 $27,916 $17,531 $15,486 $13,996 $15,052
Ratio to average net assets of:
Expenses, net of waivers/
reimbursements ...................... 1.65%(d) 1.65% 1.65% 1.65% 1.70% 1.70%
Expenses, before waivers/
reimbursements ...................... 1.92%(d) 1.98% 1.99% 2.10% 2.14% 2.17%
Net investment income, net of
waivers/reimbursements .............. 4.73%(d) 3.98% 4.41% 4.73% 4.69% 5.09%
Portfolio turnover rate ................. 216% 249% 70% 85% 185% 114%
</TABLE>
See footnote summary on page 93.
--------------------------------------------------------------------------------
90 o ALLIANCE MUNICIPAL INCOME FUND II
<PAGE>
--------------------
FINANCIAL HIGHLIGHTS
--------------------
Selected Data For A Share Of Beneficial Interest Outstanding Throughout Each
Period
<TABLE>
<CAPTION>
Virginia Portfolio
----------------------------------------------------------------------------
Class A
----------------------------------------------------------------------------
Six Months
Ended
March 31, Year Ended September 30,
2000 ------------------------------------------------------------
(unaudited) 1999 1998 1997 1996 1995
----------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning of year ..................... $10.32 $11.02 $10.90 $10.58 $10.29 $9.69
----------------------------------------------------------------------------
Income From Investment
Operations
Net investment income(a) ................ .28(b) .49(b) .52(b) .57(b) .57(b) .56
Net realized and unrealized
gain (loss) on investment
transactions .......................... (.11) (.60) .49 .57 .37 .61
----------------------------------------------------------------------------
Net increase (decrease) in
net asset value from
operations ............................ .17 (.11) 1.01 1.14 .94 1.17
----------------------------------------------------------------------------
Less: Dividends and
Distributions
Dividends from net
investment income ..................... (.28) (.49) (.52) (.57) (.57) (.56)
Distributions in excess of
net investment income ................. -0- (.07) (.05) -0- -0- (.01)
Distributions from net
realized gains ........................ -0- (.03) (.32) (.25) (.08) -0-
----------------------------------------------------------------------------
Total dividends and
distributions ......................... (.28) (.59) (.89) (.82) (.65) (.57)
----------------------------------------------------------------------------
Net asset value,
end of period ......................... $10.21 $10.32 $11.02 $10.90 $10.58 $10.29
============================================================================
Total Return
Total investment return
based on net asset value(c) ........... 1.68% (1.10)% 9.65% 11.32% 9.39% 12.46%
Ratios/Supplemental
Data
Net assets, end of period
(000's omitted) ....................... $33,164 $28,148 $10,315 $3,530 $2,455 $1,855
Ratio to average net assets of:
Expenses, net of waivers/
reimbursements ...................... .67%(d) .67% .67% .67% .67% .67%
Expenses, before waivers/
reimbursements ...................... 1.27%(d) 1.43% 2.09% 3.57% 5.18% 8.96%
Net investment income, net of
waivers/reimbursements .............. 5.52%(d) 4.67% 4.84% 5.39% 5.39% 5.59%
Portfolio turnover rate ................. 223% 311% 62% 258% 298% 128%
</TABLE>
See footnote summary on page 93.
--------------------------------------------------------------------------------
ALLIANCE MUNICIPAL INCOME FUND II o 91
<PAGE>
--------------------
FINANCIAL HIGHLIGHTS
--------------------
Selected Data For A Share Of Beneficial Interest Outstanding Throughout Each
Period
<TABLE>
<CAPTION>
Virginia Portfolio
----------------------------------------------------------------------------
Class B
----------------------------------------------------------------------------
Six Months
Ended
March 31, Year Ended September 30,
2000 ------------------------------------------------------------
(unaudited) 1999 1998 1997 1996 1995
----------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning of year ..................... $10.31 $11.01 $10.90 $10.57 $10.29 $9.69
----------------------------------------------------------------------------
Income From Investment
Operations
Net investment income(a) ................ .24(b) .42(b) .44(b) .50(b) .50(b) .49
Net realized and unrealized
gain (loss) on investment
transactions .......................... (.11) (.60) .49 .58 .36 .61
----------------------------------------------------------------------------
Net increase (decrease) in
net asset value from
operations ............................ .13 (.18) .93 1.08 .86 1.10
----------------------------------------------------------------------------
Less: Dividends and
Distributions
Dividends from net
investment income ..................... (.24) (.42) (.44) (.50) (.50) (.49)
Distributions in excess of
net investment income ................. -0- (.07) (.06) -0- -0- (.01)
Distributions from net
realized gains ........................ -0- (.03) (.32) (.25) (.08) -0-
----------------------------------------------------------------------------
Total dividends and
distributions ......................... (.24) (.52) (.82) (.75) (.58) (.50)
----------------------------------------------------------------------------
Net asset value,
end of period ......................... $10.20 $10.31 $11.01 $10.90 $10.57 $10.29
============================================================================
Total Return
Total investment return
based on net asset value(c) ........... 1.33% (1.73)% 8.85% 10.70% 8.57% 11.67%
Ratios/Supplemental
Data
Net assets, end of period
(000's omitted) ....................... $44,799 $42,007 $15,973 $5,020 $3,345 $1,193
Ratio to average net assets of:
Expenses, net of waivers/
reimbursements ...................... 1.37%(d) 1.37% 1.37% 1.37% 1.37% 1.37%
Expenses, before waivers/
reimbursements ...................... 1.98%(d) 2.20% 2.84% 4.29% 5.88% 9.66%
Net investment income, net of
waivers/reimbursements .............. 4.82%(d) 3.97% 4.14% 4.68% 4.70% 4.80%
Portfolio turnover rate ................. 223% 311% 62% 258% 298% 128%
</TABLE>
See footnote summary on page 93.
--------------------------------------------------------------------------------
92 o ALLIANCE MUNICIPAL INCOME FUND II
<PAGE>
--------------------
FINANCIAL HIGHLIGHTS
--------------------
Selected Data For A Share Of Beneficial Interest Outstanding Throughout Each
Period
<TABLE>
<CAPTION>
Virginia Portfolio
----------------------------------------------------------------------------
Class C
----------------------------------------------------------------------------
Six Months
Ended
March 31, Year Ended September 30,
2000 ------------------------------------------------------------
(unaudited) 1999 1998 1997 1996 1995
----------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning of year ..................... $10.31 $11.01 $10.90 $10.57 $10.29 $9.70
-----------------------------------------------------------------------------
Income From Investment
Operations
Net investment income(a) ................ .24(b) .42(b) .44(b) .50(b) .50(b) .49
Net realized and unrealized
gain (loss) on investment
transactions .......................... (.11) (.60) .49 .58 .36 .60
----------------------------------------------------------------------------
Net increase (decrease) in
net asset value from
operations ............................ .13 (.18) .93 1.08 .86 1.09
----------------------------------------------------------------------------
Less: Dividends and
Distributions
Dividends from net
investment income ..................... (.24) (.42) (.44) (.50) (.50) (.49)
Distributions in excess of
net investment income ................. -0- (.07) (.06) -0- -0- (.01)
Distributions from net
realized gains ........................ -0- (.03) (.32) (.25) (.08) -0-
----------------------------------------------------------------------------
Total dividends and
distributions ......................... (.24) (.52) (.82) (.75) (.58) (.50)
----------------------------------------------------------------------------
Net asset value,
end of period ......................... $10.20 $10.31 $11.01 $10.90 $10.57 $10.29
============================================================================
Total Return
Total investment return
based on net asset value(c) ........... 1.33% (1.73)% 8.85% 10.70% 8.58% 11.56%
Ratios/Supplemental
Data
Net assets, end of period
(000's omitted) ....................... $15,127 $12,962 $4,597 $1,207 $ 642 $ 122
Ratio to average net assets of:
Expenses, net of waivers/
reimbursements ...................... 1.37%(d) 1.37% 1.37% 1.37% 1.37% 1.37%
Expenses, before waivers/
reimbursements ...................... 1.97%(d) 2.19% 2.85% 4.25% 5.88% 9.66%
Net investment income, net of
waivers/reimbursements .............. 4.82%(d) 3.97% 4.11% 4.66% 4.73% 4.81%
Portfolio turnover rate ................. 223% 311% 62% 258% 298% 128%
</TABLE>
(a) Net of fee waived and expenses reimbursed by the Adviser.
(b) Based on average shares.
(c) Total investment return is calculated assuming an initial investment made
at the net asset value at the beginning of the period, reinvestment of all
dividends and distributions at net asset value during the period, and
redemption on the last day of the period. Initial sales charge or
contingent deferred sales charge is not reflected in the calculation of
total investment return. Total investment return calculated for a period
of less than one year is not annualized.
(d) Annualized.
--------------------------------------------------------------------------------
ALLIANCE MUNICIPAL INCOME FUND II o 93
<PAGE>
----------------------------
GLOSSARY OF INVESTMENT TERMS
----------------------------
GLOSSARY OF INVESTMENT TERMS
basis point (bp)
One basis point equals 0.01%.
benchmark
A standard by which a fund's performance can be measured. A benchmark is usually
an unmanaged index, such as the Standard & Poor's 500 Stock Index or the Lehman
Brothers Aggregate Bond Index.
bond
Bonds are issued by governments or corporations when they need to raise cash.
Bonds are sold, or issued, to investors and have a maturity date, which is the
date the issuer is obligated to repay the investor for the principal, or face
amount, of the bond. Bonds also pay interest until maturity. Bonds are also
called fixed-income securities.
common stock
A type of security that represents ownership in a public company.
credit rating
Credit ratings are issued by independent organizations, such as Standard &
Poor's Ratings group or Moody's Investors Services. These groups attempt to
assess the likelihood that the issuer of the bond will be able to make timely
payments of principal and interest on the bond, based on such factors as the
issuer's financial condition and any collateral securing these obligations.
Ratings typically range from AAA which is the highest rating, to D, which is the
lowest rating.
current yield
The ratio of interest to the current market price of the bond, expressed as a
percentage.
A common measurement of a stock's performance, calculated by taking a company's
net income and dividing it by the number of shares the company has outstanding.
equity
Another term for stock.
Federal Reserve Board
The seven-member board that oversees Federal Reserve Banks, establishes monetary
policy and monitors the country's economic state.
fixed-income security
A bond.
fixed rate
The interest rate does not change during the entire term of the loan.
index
A compilation of securities of similar types of companies that is used to
measure the investment performance of securities within that specific market. An
index is often used as a benchmark for a mutual fund. An investor cannot invest
directly in an index.
net asset value (NAV)
The value of a mutual fund's total assets, minus its liabilities, divided by the
number of shares outstanding.
portfolio
The collection of securities that make up a fund's or an investor's investments.
sector
This refers to a distinct part of the economy, for example, the technology
sector.
Treasuries
Negotiable U.S. Government debt obligations, backed by the full faith and credit
of the U.S. Government. Treasuries are issued either as bills, notes or bonds,
depending on the maturity. Treasuries are exempt from state and local taxes.
--------------------------------------------------------------------------------
94 o ALLIANCE MUNICIPAL INCOME FUND II
<PAGE>
----------------
ALLIANCE CAPITAL
----------------
ALLIANCE CAPITAL
The Investment Professional's Choice
Alliance Capital is a leading global investment management firm with over $394
billion in assets under management. In recognition of our far-reaching
investment capabilities, Alliance Capital has been selected by employee benefit
plans for 28 of the FORTUNE 100 companies and public retirement funds in 33
states as well as by hundreds of foundations, endowments and foreign
institutions. By sharing this institutional money management experience with
millions of mutual fund investors as well, Alliance stands out as a "manager of
choice" for thousands of investment professionals around the world.
At Alliance Capital, we place a premium on investment research. We carefully
select securities based on our proprietary research, conducted by over 276
investment professionals in 22 investment offices worldwide. Our commitment to
this process means that our mutual fund shareholders have their portfolios
managed by the same experienced analysts and portfolio managers who manage the
pension funds of some of America's largest institutional investors.
All information on Alliance Capital is as of 3/31/00.
--------------------------------------------------------------------------------
ALLIANCE MUNICIPAL INCOME FUND II o 95
<PAGE>
--------------------------------
ALLIANCE CAPITAL AT YOUR SERVICE
--------------------------------
ALLIANCE CAPITAL AT YOUR SERVICE
At Alliance Capital, shareholder satisfaction is among our top priorities.
That's why we provide our shareholders with a wide variety of products and
time-saving services to meet their needs.
o Low Minimum Investments
You can begin investing in Alliance Capital funds with as little as $250
(except for Alliance Select Investor Series Premier Portfolio and Alliance
Select Investor Series Technology Portfolio, which generally have a $10,000
minimum initial investment) and may make subsequent investments of $50 or
more.
o Automatic Reinvestment
You may choose to reinvest fund dividend and capital-gains distributions
automatically at no charge.
o Automatic Investment Program
Build your investment account by having money automatically transferred from
your bank account on a regular basis.
o Dividend Direction Plans
You may cross-invest dividends from one fund into the same class of shares in
any other fund without incurring a sales charge. This can be a good way to
diversify your assets.
o The Alliance Advance
A quarterly newsletter discussing investment strategies, economic news and
other matters that could affect your mutual fund investment.
o Auto Exchange
You may choose to automatically exchange money from one Alliance Capital fund
to another on a regular basis. This can be a good way to dollar cost
average*, helping you to invest with discipline.
o Systematic Withdrawals
Regular checks for specified amounts can be sent to you or to your brokerage
or bank account.
o A Choice of Purchase Plans
Most funds are available in A, B, and C class shares. Many funds are also
available in Advisor Class shares.
o Telephone Transaction
Purchases, transfers and redemptions can be made by calling (800) 221-5672.
Our knowledgeable representatives are available to assist you Monday through
Friday from 8:30 a.m. to 8:00 p.m. Eastern Standard Time.
o Alliance Answer: 24-Hour Information
For your convenience, our computerized audio response system is available to
you 24-hours a day by calling (800) 251-0539. Using any touch tone phone, you
can hear share prices, get account balances, review details of your last
transaction, obtain dividend information, order statements/checkbooks, review
fund objectives, literature and Watchlist information, order additional
copies of statements and request additional year-end tax forms (available
from February 1 to May 31).
o Alliance Capital on the World Wide Web at www.alliancecapital.com. Here, you
can access updated account information, make additional investments, request
more information, exchange between Alliance funds and view fund performance,
press releases and articles.
* Dollar cost averaging does not assure a profit nor protect against loss in a
declining market. Since this strategy involves continuous investments in
securities, regardless of fluctuating prices, investors should consider their
financial ability to invest during periods of low price levels.
--------------------------------------------------------------------------------
96 o ALLIANCE MUNICIPAL INCOME FUND II
<PAGE>
------------------
BOARD OF DIRECTORS
------------------
BOARD OF TRUSTEES
John D. Carifa, Chairman and President
Ruth Block(1)
David H. Dievler(1)
John H. Dobkin(1)
William H. Foulk, Jr.(1)
Dr. James M. Hester(1)
Clifford L. Michel(1)
Donald J. Robinson(1)
OFFICERS
Susan P. Keenan, Senior Vice President
David Dowden, Vice President
Terrance Hults, Vice President
Kathleen A. Corbet, Senior Vice President
Wayne D. Lyski, Senior Vice President
William E. Oliver, Vice President
Edmund P. Bergan, Jr., Secretary
Mark D. Gersten, Treasurer & Chief Financial Officer
Juan J. Rodriguez, Controller
Custodian
The Bank of New York
One Wall Street
New York, NY 10286
Principal Underwriter
Alliance Fund Distributors, Inc.
1345 Avenue of the Americas
New York, NY 10105
Legal Counsel
Seward & Kissel
One Battery Park Plaza
New York, NY 10004
Independent Auditors
Ernst & Young LLP
787 Seventh Avenue
New York, NY 10019
Transfer Agent
Alliance Fund Services, Inc.
P.O. Box 1520
Secaucus, NJ 07096-1520
Toll-free 1-(800) 221-5672
(1) Member of the Audit Committee.
--------------------------------------------------------------------------------
ALLIANCE MUNICIPAL INCOME FUND II o 97
<PAGE>
--------------------------------
ALLIANCE CAPITAL FAMILY OF FUNDS
--------------------------------
ALLIANCE CAPITAL FAMILY OF FUNDS
Domestic Equity Funds
Balanced Shares
Conservative Investors Fund
Disciplined Value Fund
Growth & Income Fund
Growth Fund
Growth Investors Fund
Health Care Fund
Premier Growth Fund
Quasar Fund
Real Estate Investment Fund
Technology Fund
The Alliance Fund
Utility Income Fund
Global & International Equity Funds
All-Asia Investment Fund
Global Small Cap Fund
Greater China '97 Fund
International Fund
International Premier Growth Fund
New Europe Fund
Worldwide Privatization Fund
Select Investor Series
Premier Portfolio
Technology Portfolio
Fixed Income Funds
Corporate Bond Portfolio
Global Dollar Government Fund
Global Strategic Income Trust
High Yield Fund
Limited Maturity Government Fund
Mortgage Securities Income Fund
Multi-Market Strategy Trust
North American Government Income Trust
Quality Bond Portfolio
U.S. Government Portfolio
Municipal Income Funds
National
Insured National
Arizona
California
Insured California
Florida
Massachusetts
Michigan
Minnesota
New Jersey
New York
Ohio
Pennsylvania
Virginia
Alliance also offers AFD Exchange Reserves, which serves as the money market
fund exchange vehicle for the Alliance mutual funds.
To obtain a prospectus for any Alliance Capital fund, call your investment
professional, or call Alliance at (800) 227-4618.
--------------------------------------------------------------------------------
98 o ALLIANCE MUNICIPAL INCOME FUND II
<PAGE>
NOTES
--------------------------------------------------------------------------------
ALLIANCE MUNICIPAL INCOME FUND II o 99
<PAGE>
NOTES
--------------------------------------------------------------------------------
100 o ALLIANCE MUNICIPAL INCOME FUND II
<PAGE>
Alliance Municipal Income Fund II
1345 Avenue of the Americas
New York, NY 10105
(800) 221-5672
-----------------
BULK RATE
U.S. POSTAGE
PAID
New York, NY
Permit No. 7131
-----------------
ALLIANCE CAPITAL [LOGO] {R}
The Investment Professional's Choice
(R) These registered service marks used under
license from the owner, Alliance Capital
Management L.P.
MUNIIISR300
