N-CSR 1 d204695dncsr.htm BLACKROCK CALIFORNIA MUNICIPAL INCOME TRUST BLACKROCK CALIFORNIA MUNICIPAL INCOME TRUST

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM N-CSR

CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES

Investment Company Act file number: 811-10331

 

Name of Fund:   BlackRock California Municipal Income Trust (BFZ)

 

Fund Address:   100 Bellevue Parkway, Wilmington, DE 19809

Name and address of agent for service: John M. Perlowski, Chief Executive Officer, BlackRock California
Municipal Income Trust, 55 East 52nd Street, New York, NY 10055

Registrant’s telephone number, including area code: (800) 882-0052, Option 4

Date of fiscal year end: 07/31/2021

Date of reporting period: 07/31/2021

 


Item 1 –

Report to Stockholders

(a) The Report to Shareholders is attached herewith.


 

LOGO

  JULY 31, 2021

 

  

2021 Annual Report

 

 

BlackRock California Municipal Income Trust (BFZ)

BlackRock Municipal 2030 Target Term Trust (BTT)

BlackRock New York Municipal Income Trust (BNY)

 

 

 

 

 

 

 

Not FDIC Insured • May Lose Value • No Bank Guarantee

 


The Markets in Review

Dear Shareholder,

The 12-month reporting period as of July 31, 2021 was a remarkable period of adaptation and recovery, as the global economy dealt with the implications of the coronavirus (or “COVID-19”) pandemic. The United States, along with most of the world, began the reporting period emerging from a severe recession, prompted by pandemic-related restrictions that disrupted many aspects of daily life. However, easing restrictions and robust government intervention led to a strong rebound, and the economy grew at a significant pace for the reporting period, eventually regaining the output lost from the pandemic.

Equity prices rose with the broader economy, as strong fiscal and monetary support, as well as the development of vaccines, made investors increasingly optimistic about the economic outlook. The implementation of mass vaccination campaigns and passage of two additional fiscal stimulus packages further boosted stocks, and many equity indices neared or surpassed all-time highs late in the reporting period. In the United States, returns of small-capitalization stocks, which benefited the most from the resumption of in-person activities, outpaced large-capitalization stocks. International equities also gained, as both developed and emerging markets rebounded substantially.

The 10-year U.S. Treasury yield (which is inversely related to bond prices) had fallen sharply prior to the beginning of the reporting period, which meant bonds were priced for extreme risk avoidance and economic disruption. Despite expectations of doom and gloom, the economy expanded rapidly, stoking inflation concerns in early 2021, which led to higher yields and a negative overall return for most U.S. Treasuries. In the corporate bond market, support from the U.S. Federal Reserve (the “Fed”) assuaged credit concerns and led to solid returns for high-yield corporate bonds, although investment-grade corporates declined slightly.

The Fed remained committed to accommodative monetary policy by maintaining near zero interest rates and by reiterating that inflation could exceed its 2% target for a sustained period without triggering a rate increase. In response to rising inflation late in the period, the Fed changed its market guidance, raising the likelihood of less bond purchasing and the possibility of higher rates in 2023.

Looking ahead, we believe that the global expansion will continue to broaden as Europe and other developed market economies gain momentum, although the Delta variant remains a threat, particularly in emerging markets. While we expect inflation to remain elevated in the medium-term as the expansion continues, we believe the recent uptick owes more to temporary supply disruptions than a lasting change in fundamentals. The change in Fed policy also means that moderate inflation is less likely to be followed by interest rate hikes that could threaten the economic expansion.

Overall, we favor a moderately positive stance toward risk, with an overweight in equities. Sectors that are better poised to manage the transition to a lower-carbon world, such as technology and healthcare, are particularly attractive in the long-term. U.S. small-capitalization stocks and European equities are likely to benefit from the continuing vaccine-led restart. We are underweight long-term credit, but inflation-protected U.S. Treasuries, Asian fixed income, and Chinese government bonds offer potential opportunities. We believe that international diversification and a focus on sustainability can help provide portfolio resilience, and the disruption created by the coronavirus appears to be accelerating the shift toward sustainable investments.

In this environment, our view is that investors need to think globally, extend their scope across a broad array of asset classes, and be nimble as market conditions change. We encourage you to talk with your financial advisor and visit blackrock.com for further insight about investing in today’s markets.

Sincerely,

 

 

LOGO

Rob Kapito

President, BlackRock Advisors, LLC

LOGO

Rob Kapito

President, BlackRock Advisors, LLC

 

Total Returns as of July 31, 2021

 

      

 

 6-Month 

 

 

 

 12-Month 

 

   

 

U.S. large cap equities
(S&P 500® Index)

 

  19.19%   36.45%
   

 

U.S. small cap equities
(Russell 2000® Index)

 

  7.86   51.97
   

 

International equities
(MSCI Europe, Australasia,
Far East Index)

 

  10.83   30.31
   

 

Emerging market equities
(MSCI Emerging Markets Index)

 

  (2.76)   20.64
   

 

3-month Treasury bills
(ICE BofA 3-Month
U.S. Treasury Bill Index)

 

  0.02   0.08
   

 

U.S. Treasury securities
(ICE BofA 10-Year
U.S. Treasury Index)

 

  (0.59)   (5.12)
   

 

U.S. investment grade bonds
(Bloomberg Barclays
U.S. Aggregate Bond Index)

 

  0.21   (0.70)
   

 

Tax-exempt municipal bonds
(S&P Municipal Bond Index)

 

  1.38   3.47
   

 

U.S. high yield bonds
(Bloomberg Barclays U.S. Corporate High Yield 2% Issuer Capped Index)

 

  3.66   10.62

Past performance is not an indication of future results. Index performance is shown for illustrative purposes only. You cannot invest directly in an index.

 

 

 

 

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Table of Contents

 

      Page  

The Markets in Review

  

 

2

 

Annual Report:

  

Municipal Market Overview

  

 

4

 

The Benefits and Risks of Leveraging

  

 

5

 

Derivative Financial Instruments

  

 

5

 

Trust Summary

  

 

6

 

Financial Statements:

  

Schedules of Investments

  

 

15

 

Statements of Assets and Liabilities

  

 

38

 

Statements of Operations

  

 

39

 

Statements of Changes in Net Assets

  

 

40

 

Statements of Cash Flows

  

 

42

 

Financial Highlights

  

 

44

 

Notes to Financial Statements

  

 

47

 

Report of Independent Registered Public Accounting Firm

  

 

59

 

Important Tax Information

  

 

60

 

Disclosure of Investment Advisory Agreements

  

 

61

 

Investment Objectives, Policies and Risks

  

 

65

 

Automatic Dividend Reinvestment Plan

  

 

73

 

Trustee and Officer Information

  

 

74

 

Additional Information

  

 

78

 

Glossary of Terms Used in this Report

  

 

81

 

 

 

        

  3


Municipal Market Overview  For the Reporting Period Ended July 31, 2021

 

Municipal Market Conditions

Municipal bonds posted positive total returns during the period despite rising interest rates as the economy normalized from the pandemic-induced economic shutdown. The asset class benefited from favorable supply and demand dynamics and improved credit fundamentals amid considerable fiscal stimulus and a quicker-than-expected rebound in state and local government revenues. As a result, municipal bonds generated substantial excess returns versus duration-matched U.S. Treasuries, and longer duration and lower credit quality strategies outperformed. Despite broad strength, the market contended with brief periods of volatility surrounding U.S. election uncertainty as well as a temporary valuation-based market correction in late February.

 

Technical support was strong throughout the period as robust demand outpaced supply. During the 12 months ended July 31, 2021, municipal bond funds experienced net inflows totaling $98 billion, with January 2021 producing the largest monthly net inflow on record (based on data from the Investment Company Institute). For the same period, the market absorbed $471 billion in issuance, notably elevated compared to the $450 billion issued during the prior 12-month period. However, taxable municipal issuance, which typically draws a different and unique buyer base, was proportionally elevated, making supply less onerous on the traditional tax-exempt market.

 

    

 

 

    S&P Municipal Bond Index

        Total Returns as of July 31, 2021             

          6 months:  1.38%

        12 months:  3.47%

 

   
   
   
   

A Closer Look at Yields

 

 

LOGO

 

 

From July 31, 2020 to July 31, 2021, yields on AAA-rated 30-year municipal bonds increased by 2 basis points (“bps”) from 1.37% to 1.39%, while ten-year rates increased by 17 bps from 0.65% to 0.82% and five-year rates increased by 13 bps from 0.23% to 0.36% (as measured by Thomson Municipal Market Data). As a result, the municipal yield curve steepened over the 12-month period with the spread between two- and 30-year maturities steepening by 9 bps, led by 24 bps of steepening between two- and ten-year maturities.

Consistent municipal outperformance has resulted in stretched valuations. After dislocating at the height of the pandemic, municipal-to-U.S. Treasury ratios posted all-time lows in February 2021 and remained well below historical averages.

 

 

Financial Conditions of Municipal Issuers

The COVID-19 pandemic has been an unprecedented shock to the system impacting nearly every sector in the municipal market. Fortunately, most states and municipalities were in excellent fiscal health before the crisis, and the federal government delivered another $350 billion injection. Direct state and local government aid has provided additional support to own-source government tax receipts, which continue to outperform the dire predictions made in early 2020. Essential public services such as power, water, and sewer remain protected segments. State housing authority bonds, flagship universities, and strong national and regional health systems have absorbed the impact of the economic shock. While some segments still confront financial pressures, the combination of new federal stimulus and vaccine distribution is boosting economic activity and, consequently, increasing revenue receipts in these sectors as well. Critical providers (safety net hospitals, mass transit systems, airports) with limited resources may still experience fiscal strain but the additional aid and the re-opening of the economy will continue to support operating results in the second half of 2021, despite the surging delta variant of the coronavirus. BlackRock anticipates that a small subset of the market, mainly non-rated stand-alone projects, will remain susceptible to credit deterioration. However, the risk of new mandated lockdowns is significantly diminished, and we expect limited impact on the high fundamental quality of state and local governments as well as essential service providers. While credit fundamentals have improved noticeably across the municipal space, BlackRock advocates careful credit selection as the market must still navigate near-term uncertainty.

The opinions expressed are those of BlackRock as of July 31, 2021 and are subject to change at any time due to changes in market or economic conditions. The comments should not be construed as a recommendation of any individual holdings or market sectors. Investing involves risk including loss of principal. Bond values fluctuate in price so the value of your investment can go down depending on market conditions. Fixed income risks include interest-rate and credit risk. Typically, when interest rates rise, there is a corresponding decline in bond values. Credit risk refers to the possibility that the bond issuer will not be able to make principal and interest payments. There may be less information on the financial condition of municipal issuers than for public corporations. The market for municipal bonds may be less liquid than for taxable bonds. Some investors may be subject to Alternative Minimum Tax (“AMT”). Capital gains distributions, if any, are taxable.

The S&P Municipal Bond Index, a broad, market value-weighted index, seeks to measure the performance of the U.S. municipal bond market. All bonds in the index are exempt from U.S. federal income taxes or subject to the AMT. Past performance is not an indication of future results. Index performance is shown for illustrative purposes only. It is not possible to invest directly in an index.

 

 

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The Benefits and Risks of Leveraging

 

The Trusts may utilize leverage to seek to enhance the distribution rate on, and net asset value (“NAV”) of, their common shares (“Common Shares”). However, there is no guarantee that these objectives can be achieved in all interest rate environments.

In general, the concept of leveraging is based on the premise that the financing cost of leverage, which is based on short-term interest rates, is normally lower than the income earned by a Trust on its longer-term portfolio investments purchased with the proceeds from leverage. To the extent that the total assets of each Trust (including the assets obtained from leverage) are invested in higher-yielding portfolio investments, each Trust’s shareholders benefit from the incremental net income. The interest earned on securities purchased with the proceeds from leverage (after paying the leverage costs) is paid to shareholders in the form of dividends, and the value of these portfolio holdings (less the leverage liability) is reflected in the per share NAV.

To illustrate these concepts, assume a Trust’s Common Shares capitalization is $100 million and it utilizes leverage for an additional $30 million, creating a total value of $130 million available for investment in longer-term income securities. If prevailing short-term interest rates are 3% and longer-term interest rates are 6%, the yield curve has a strongly positive slope. In this case, a Trust’s financing costs on the $30 million of proceeds obtained from leverage are based on the lower short-term interest rates. At the same time, the securities purchased by a Trust with the proceeds from leverage earn income based on longer-term interest rates. In this case, a Trust’s financing cost of leverage is significantly lower than the income earned on a Trust’s longer-term investments acquired from such leverage proceeds, and therefore the holders of Common Shares (“Common Shareholders”) are the beneficiaries of the incremental net income.

However, in order to benefit Common Shareholders, the return on assets purchased with leverage proceeds must exceed the ongoing costs associated with the leverage. If interest and other costs of leverage exceed a Trust’s return on assets purchased with leverage proceeds, income to shareholders is lower than if a Trust had not used leverage. Furthermore, the value of the Trusts’ portfolio investments generally varies inversely with the direction of long-term interest rates, although other factors can influence the value of portfolio investments. In contrast, the amount of each Trust’s obligations under its respective leverage arrangement generally does not fluctuate in relation to interest rates. As a result, changes in interest rates can influence the Trusts’ NAVs positively or negatively. Changes in the future direction of interest rates are very difficult to predict accurately, and there is no assurance that a Trust’s intended leveraging strategy will be successful.

The use of leverage also generally causes greater changes in each Trust’s NAV, market price and dividend rates than comparable portfolios without leverage. In a declining market, leverage is likely to cause a greater decline in the NAV and market price of a Trust’s Common Shares than if the Trust were not leveraged. In addition, each Trust may be required to sell portfolio securities at inopportune times or at distressed values in order to comply with regulatory requirements applicable to the use of leverage or as required by the terms of leverage instruments, which may cause the Trust to incur losses. The use of leverage may limit a Trust’s ability to invest in certain types of securities or use certain types of hedging strategies. Each Trust incurs expenses in connection with the use of leverage, all of which are borne by Common Shareholders and may reduce income to the Common Shares. Moreover, to the extent the calculation of each Trust’s investment advisory fees includes assets purchased with the proceeds of leverage, the investment advisory fees payable to the Trusts’ investment adviser will be higher than if the Trusts did not use leverage.

To obtain leverage, each Trust has issued Variable Rate Demand Preferred Shares (“VRDP Shares”), Variable Rate Muni Term Preferred Shares (“VMTP Shares”) or Remarketable Variable Rate Muni Term Preferred Shares (“RVMTP Shares”) (collectively, “Preferred Shares”) and/or leveraged its assets through the use of tender option bond trusts (“TOB Trusts”) as described in the Notes to Financial Statements.

Under the Investment Company Act of 1940, as amended (the “1940 Act”), each Trust is permitted to issue debt up to 33 1/3% of its total managed assets or equity securities (e.g., Preferred Shares) up to 50% of its total managed assets. A Trust may voluntarily elect to limit its leverage to less than the maximum amount permitted under the 1940 Act. In addition, a Trust may also be subject to certain asset coverage, leverage or portfolio composition requirements imposed by the Preferred Shares’ governing instruments or by agencies rating the Preferred Shares, which may be more stringent than those imposed by the 1940 Act.

If a Trust segregates or designates on its books and records cash or liquid assets having a value not less than the value of a Trust’s obligations under the TOB Trust (including accrued interest), then the TOB Trust is not considered a senior security and is not subject to the foregoing limitations and requirements imposed by the 1940 Act.

Derivative Financial Instruments

The Trusts may invest in various derivative financial instruments. These instruments are used to obtain exposure to a security, commodity, index, market, and/or other assets without owning or taking physical custody of securities, commodities and/or other referenced assets or to manage market, equity, credit, interest rate, foreign currency exchange rate, commodity and/or other risks. Derivative financial instruments may give rise to a form of economic leverage and involve risks, including the imperfect correlation between the value of a derivative financial instrument and the underlying asset, possible default of the counterparty to the transaction or illiquidity of the instrument. The Trusts’ successful use of a derivative financial instrument depends on the investment adviser’s ability to predict pertinent market movements accurately, which cannot be assured. The use of these instruments may result in losses greater than if they had not been used, may limit the amount of appreciation a Trust can realize on an investment and/or may result in lower distributions paid to shareholders. The Trusts’ investments in these instruments, if any, are discussed in detail in the Notes to Financial Statements.

 

 

H E    E N E F I T S     A N D    I S K S    O F    E V E R A G I N G     /    D E R I V A T I V E    I N A N C I A L    N S T R U M E N T S

  5


Trust Summary  as of July 31, 2021     BlackRock California Municipal Income Trust (BFZ)

 

Investment Objective

BlackRock California Municipal Income Trust’s (BFZ) (the “Trust”) investment objective is to provide current income exempt from regular U.S. federal income and California income taxes. The Trust seeks to achieve its investment objective by investing primarily in municipal obligations exempt from U.S. federal income taxes (except that the interest may be subject to the federal alternative minimum tax) and California income taxes. The Trust invests, under normal market conditions, at least 80% of its assets in municipal obligations that are investment grade quality, or are considered by the Trust’s investment adviser to be of comparable quality, at the time of investment. The Trust may invest directly in securities or synthetically through the use of derivatives.

No assurance can be given that the Trust’s investment objective will be achieved.

Trust Information

 

   

Symbol on New York Stock Exchange

  BFZ

Initial Offering Date

  July 27, 2001

Yield on Closing Market Price as of July 31, 2021 ($15.01)(a)

  3.44%

Tax Equivalent Yield(b)

  7.49%

Current Monthly Distribution per Common Share(c)

  $0.0430

Current Annualized Distribution per Common Share(c)

  $0.5160

Leverage as of July 31, 2021(d)

  38%

 

  (a) 

Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. Past performance is not an indication of future results.

 
  (b) 

Tax equivalent yield assumes the maximum marginal U.S. federal and state tax rate of 54.1%, which includes the 3.8% Medicare tax. Actual tax rates will vary based on income, exemptions and deductions. Lower taxes will result in lower tax equivalent yields.

 
  (c) 

The distribution rate is not constant and is subject to change.

 
  (d) 

Represents VMTP Shares and TOB Trusts as a percentage of total managed assets, which is the total assets of the Trust, including any assets attributable to VMTP Shares and TOB Trusts, minus the sum of its accrued liabilities. Does not reflect derivatives or other instruments that may give rise to economic leverage. For a discussion of leveraging techniques utilized by the Trust, please see The Benefits and Risks of Leveraging and Derivative Financial Instruments.

 

Market Price and Net Asset Value Per Share Summary

 

     07/31/21      07/31/20      Change      High      Low  

Closing Market Price

  $ 15.01      $ 13.79        8.85    $ 15.13      $ 13.00  

Net Asset Value

    16.29        15.86        2.71        16.36        15.33  

TOTAL RETURN BASED ON A $10,000 INVESTMENT

 

 

LOGO

 

  (a) 

Represents the Trust’s closing market price on the NYSE and reflects the reinvestment of dividends and/or distributions at actual reinvestment prices.

 
  (b) 

A broad, market value-weighted index that seeks to measure the performance of the U.S. municipal bond market.

 

 

 

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Trust Summary  as of July 31, 2021 (continued)    BlackRock California Municipal Income Trust (BFZ)

 

Performance Summary for the Period Ended July 31, 2021

Returns for the period ended July 31, 2021 were as follows:

 

    Average Annual Total Returns  
     1 Year      5 Years      10 Years  

Trust at NAV(a)(b)

    6.24      4.53      7.04

Trust at Market Price(a)(b)

    12.59        2.33        6.74  
         

Lipper California Municipal Debt Funds at NAV(c)

    5.82        4.23        7.01  

Lipper California Municipal Debt Funds at Market Price(c)

    11.62        3.53        7.64  

S&P® Municipal Bond Index

    3.47        3.34        4.29  
                           

 

  (a) 

All returns reflect reinvestment of dividends and/or distributions at actual reinvestment prices. Performance results reflect the Trust’s use of leverage.

 
  (b) 

The Trust’s discount to NAV narrowed during the period, which accounts for the difference between performance based on market price and performance based on NAV.

 
  (c) 

Average return. Returns reflect reinvestment of dividends and/or distributions at NAV on the ex-dividend date as calculated by Lipper.

 

Performance results may include adjustments made for financial reporting purposes in accordance with U.S. generally accepted accounting principles. Past performance is not an indication of future results.

More information about the Trust’s historical performance can be found in the “Closed End Funds” section of blackrock.com.

The following discussion relates to the Trust’s absolute performance based on NAV:

Despite rising yields (and falling prices) for U.S. Treasuries, municipal bonds produced healthy gains in the past 12 months. Tax-exempt bonds continued to rally off of their pandemic-driven lows due to the release of multiple coronavirus vaccines, better-than-expected growth, improving municipal finances and robust investor demand. The prospect of substantial fiscal stimulus and higher taxes were additional tailwinds for the market. These factors led to a decline in yield spreads versus U.S. Treasuries, fueling positive returns for municipal debt.

Following the outbreak of the pandemic in early 2020, the consensus expectation was that state and local issuers in California would be challenged by a sizable decline in revenues. Instead, the state’s credit rating stabilized at a strong AA level, reflecting its diversified economy, rising property values and strong performance for the equity market. The outward migration of residents and businesses looking to flee the state’s higher taxes did not result in credit deterioration. Instead, many wealthy residents looked to reduce their tax burdens by purchasing tax-exempt California municipal bonds of all credit qualities. The resulting record inflows into municipal bond funds created a dramatic imbalance in demand relative to the available supply of securities. In this favorable environment, yields declined (as prices rose) and yield spreads tightened significantly.

The Trust’s positions in long-duration securities delivered strong returns as yields declined and the yield curve flattened. (Duration is a measure of interest rate sensitivity.) Positions in high-yield securities and bonds on the lower end of the investment-grade spectrum were also leading contributors, as lower-quality bonds significantly outperformed the broader market. At the sector level, positions in transportation, tax-backed local, school district, utility and education issues made the largest contributions.

The use of leverage, which added to the Trust’s income and amplified the effect of rising prices, was a further positive. The Trust sought to manage interest rate risk using U.S. Treasury futures. Given that long-term U.S. Treasury yields rose, as prices fell, this strategy contributed to performance.

While all segments of the Trust posted gains, its positions in shorter-term debt produced lower relative returns.

The views expressed reflect the opinions of BlackRock as of the date of this report and are subject to change based on changes in market, economic or other conditions. These views are not intended to be a forecast of future events and are no guarantee of future results.

 

 

R U S T    U M M A R Y

  7


Trust Summary  as of July 31, 2021 (continued)    BlackRock California Municipal Income Trust (BFZ)

 

Overview of the Trust’s Total Investments

 

SECTOR ALLOCATION

     
Sector(a)(b)   07/31/21     07/31/20  

County/City/Special District/School District

    28     30

Transportation

    19       22  

Utilities

    15       16  

Education

    13       11  

State

    12       8  

Health

    8       9  

Tobacco

    3       3  

Housing

    2       1  

Corporate

    (c)       

CALL/MATURITY SCHEDULE

   
Calendar Year Ended December 31,(a)(d)   Percentage  

2021

      2

2022

      3  

2023

      3  

2024

      2  

2025

            5  

CREDIT QUALITY ALLOCATION

     
Credit Rating(a)(e)   07/31/21     07/31/20  

AAA/Aaa

    8     9

AA/Aa

    69       68  

A

    11       14  

BBB/Baa

    1       (c) 

BB/Ba

    (c)      (c) 

B

    (c)      1  

CC

          1  

N/R

    11 (f)      7  

 

 

 

(a) 

Excludes short-term securities.

(b) 

For Trust compliance purposes, the Trust’s sector classifications refer to one or more of the sector sub-classifications used by one or more widely recognized market indexes or rating group indexes, and/or as defined by the investment adviser. These definitions may not apply for purposes of this report, which may combine such sector sub-classifications for reporting ease.

(c) 

Rounds to less than 1% of total investments.

(d) 

Scheduled maturity dates and/or bonds that are subject to potential calls by issuers over the next five years.

(e) 

For financial reporting purposes, credit quality ratings shown above reflect the highest rating assigned by either S&P Global Ratings or Moody’s Investors Service, Inc. if ratings differ. These rating agencies are independent, nationally recognized statistical rating organizations and are widely used. Investment grade ratings are credit ratings of BBB/Baa or higher. Below investment grade ratings are credit ratings of BB/Ba or lower. Investments designated N/R are not rated by either rating agency. Unrated investments do not necessarily indicate low credit quality. Credit quality ratings are subject to change.

(f) 

The investment adviser evaluates the credit quality of unrated investments based upon certain factors including, but not limited to, credit ratings for similar investments and financial analysis of sectors and individual investments. Using this approach, the investment adviser has deemed certain of these unrated securities as investment grade quality. As of July 31, 2021, the market value of unrated securities deemed by the investment adviser to be investment grade represents less than 1% of the Trust’s total investments.

 

 

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Trust Summary  as of July 31, 2021     BlackRock Municipal 2030 Target Term Trust (BTT)

 

Investment Objective

BlackRock Municipal 2030 Target Term Trust’s (BTT) (the “Trust”) investment objectives are to provide current income exempt from regular U.S. federal income tax (but which may be subject to the federal alternative minimum tax in certain circumstances) and to return $25.00 per common share (the initial offering price per share) to holders of common shares on or about December 31, 2030. The Trust seeks to achieve its investment objectives by investing at least 80% of its assets in municipal bonds exempt from U.S. federal income taxes (except that the interest may be subject to the federal alternative minimum tax). The Trust invests at least 80% of its assets in municipal bonds that are investment grade quality, or are considered by the Trust’s investment adviser to be of comparable quality, at the time of investment. The Trust actively manages the maturity of its bonds to seek to have a dollar weighted average effective maturity approximately equal to the Trust’s maturity date. The Trust may invest directly in securities or synthetically through the use of derivatives.

There is no assurance that the Trust will achieve its investment objectives, including its investment objective of returning $25.00 per share.

Trust Information

 

   

Symbol on New York Stock Exchange

  BTT

Initial Offering Date

  August 30, 2012

Termination Date (on or about)

  December 31, 2030

Yield on Closing Market Price as of July 31, 2021 ($26.27)(a)

  2.85%

Tax Equivalent Yield(b)

  4.81%

Current Monthly Distribution per Common Share(c)

  $0.0624

Current Annualized Distribution per Common Share(c)

  $0.7488

Leverage as of July 31, 2021(d)

  34%

 

  (a) 

Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. Past performance is not an indication of future results.

 
  (b) 

Tax equivalent yield assumes the maximum marginal U.S. federal tax rate of 40.8%, which includes the 3.8% Medicare tax. Actual tax rates will vary based on income, exemptions and deductions. Lower taxes will result in lower tax equivalent yields.

 
  (c) 

The distribution rate is not constant and is subject to change.

 
  (d) 

Represents RVMTP Shares and TOB Trusts as a percentage of total managed assets, which is the total assets of the Trust, including any assets attributable to RVMTP Shares and TOB Trusts, minus the sum of accrued liabilities. Does not reflect derivatives or other instruments that may give rise to economic leverage. For a discussion of leveraging techniques utilized by the Trust, please see The Benefits and Risks of Leveraging.

 

Market Price and Net Asset Value Per Share Summary

 

     07/31/21      07/31/20      Change      High      Low  

Closing Market Price

  $ 26.27      $ 24.78        6.01    $ 26.38      $ 24.34  

Net Asset Value

    27.32        26.31        3.84        27.33        26.01  

TOTAL RETURN BASED ON A $10,000 INVESTMENT

 

 

LOGO

BTT commenced operations on August 30, 2012.

  (a) 

Represents the Trust’s closing market price on the NYSE and reflects the reinvestment of dividends and/or distributions at actual reinvestment prices.

 
  (b) 

A broad, market value-weighted index that seeks to measure the performance of the U.S. municipal bond market.

 

 

 

R U S T    U M M A R Y

  9


Trust Summary  as of July 31, 2021 (continued)    BlackRock Municipal 2030 Target Term Trust (BTT)

 

Performance Summary for the Period Ended July 31, 2021

Returns for the period ended July 31, 2021 were as follows:

 

    Average Annual Total Returns  
      1 Year        5 Years       
Since
Inception
 
(a) 

Trust at NAV(b)(c)

    6.92      5.10      5.80

Trust at Market Price(b)(c)

    9.16        5.25        4.79  

Lipper General & Insured Municipal Debt Funds (Leveraged) at NAV(d)

    9.15        4.65        5.58 (e) 

Lipper General & Insured Municipal Debt Funds (Leveraged) at Market Price(d)

    15.20        4.90        5.51 (e) 

S&P® Municipal Bond Index

    3.47        3.34        3.61  

 

  (a) 

BTT commenced operations on August 30, 2012.

 
  (b) 

All returns reflect reinvestment of dividends and/or distributions at actual reinvestment prices. Performance results reflect the Trust’s use of leverage.

 
  (c) 

The Trust’s discount to NAV narrowed during the period, which accounts for the difference between performance based on market price and performance based on NAV.

 
  (d) 

Average return. Returns reflect reinvestment of dividends and/or distributions at NAV on the ex-dividend date as calculated by Lipper.

 
  (e) 

The average annual total returns since inception represents the annualized returns for the period from August 31, 2012 to July 31, 2021.

 

Performance results may include adjustments made for financial reporting purposes in accordance with U.S. generally accepted accounting principles. Past performance is not an indication of future results.

More information about the Trust’s historical performance can be found in the “Closed End Funds” section of blackrock.com.

The following discussion relates to the Trust’s absolute performance based on NAV:

Despite rising yields (and falling prices) for U.S. Treasuries, municipal bonds produced healthy gains in the past 12 months. Tax-exempt bonds continued to rally off of their pandemic-driven lows due to the release of multiple coronavirus vaccines, better-than-expected growth, improving municipal finances and robust investor demand. The prospect of substantial fiscal stimulus and higher taxes were additional tailwinds for the market. These factors led to a decline in yield spreads versus U.S. Treasuries, fueling positive returns for municipal debt.

Holdings in the state tax-backed sector made the largest contribution to performance, led by positions in Puerto Rico and lower-rated states such as Illinois, New Jersey and Pennsylvania. Revenue sectors, including health care and transportation, also experienced meaningful price appreciation.

Positions in lower-rated issues, more generally, outpaced higher-rated securities. This trend was partially a reflection of federal aid packages that supported the financial system and helped municipalities better navigate the pandemic. The investment adviser added to the Fund’s high yield allocation throughout the period given the highly supportive supply-and-demand backdrop in the market, as well as the improving fundamental outlook stemming from resurgent economic growth and robust federal support at the state and local levels.

Longer-dated issues also delivered strong returns. The use of leverage also augmented performance by boosting income and amplifying the effect of rising prices. Conversely, reinvestment risk remained a headwind since the proceeds from bonds that matured or were called needed to be reinvested at lower yields compared with those issued when yields were higher.

The views expressed reflect the opinions of BlackRock as of the date of this report and are subject to change based on changes in market, economic or other conditions. These views are not intended to be a forecast of future events and are no guarantee of future results.

 

 

10  

2 0 2 1    B L A C K O  C K    N N U A L    E P O R T    T O    H A  R E H O L D E R S


Trust Summary  as of July 31, 2021 (continued)    BlackRock Municipal 2030 Target Term Trust (BTT)

 

Overview of the Trust’s Total Investments

 

SECTOR ALLOCATION

     
Sector(a)(b)   07/31/21     07/31/20  

Transportation

    22     24

County/City/Special District/School District

    18       14  

Health

    18       17  

State

    16       16  

Corporate

    8       8  

Education

    7       8  

Utilities

    6       8  

Tobacco

    3       3  

Housing

    2       2  

Other

    (c)       

CALL/MATURITY SCHEDULE

   
Calendar Year Ended December 31,(a)(d)   Percentage  

2021

      %(c) 

2022

      18  

2023

      10  

2024

      5  

2025

            5  

CREDIT QUALITY ALLOCATION

     
Credit Rating(a)(e)   07/31/21     07/31/20  

AAA/Aaa

    3     3

AA/Aa

    30       30  

A

    37       41  

BBB/Baa

    15       14  

BB/Ba

    4       3  

B

    (c)       

CCC/Caa

    (c)       

N/R(f)

    11       9  

 

 

 

(a) 

Excludes short-term securities.

(b) 

For Trust compliance purposes, the Trust’s sector classifications refer to one or more of the sector sub-classifications used by one or more widely recognized market indexes or rating group indexes, and/or as defined by the investment adviser. These definitions may not apply for purposes of this report, which may combine such sector sub-classifications for reporting ease.

(c) 

Rounds to less than 1% of total investments.

(d) 

Scheduled maturity dates and/or bonds that are subject to potential calls by issuers over the next five years.

(e) 

For financial reporting purposes, credit quality ratings shown above reflect the highest rating assigned by either S&P Global Ratings or Moody’s Investors Service, Inc. if ratings differ. These rating agencies are independent, nationally recognized statistical rating organizations and are widely used. Investment grade ratings are credit ratings of BBB/Baa or higher. Below investment grade ratings are credit ratings of BB/Ba or lower. Investments designated N/R are not rated by either rating agency. Unrated investments do not necessarily indicate low credit quality. Credit quality ratings are subject to change.

(f) 

The investment adviser evaluates the credit quality of unrated investments based upon certain factors including, but not limited to, credit ratings for similar investments and financial analysis of sectors and individual investments. Using this approach, the investment adviser has deemed certain of these unrated securities as investment grade quality. As of July 31, 2021 and July 31, 2020, the market value of unrated securities deemed by the investment adviser to be investment grade each represents less than 1% of the Trust’s total investments.

 

 

R U S T    U M M A R Y

  11


Trust Summary  as of July 31, 2021    BlackRock New York Municipal Income Trust (BNY)

 

Investment Objective

BlackRock New York Municipal Income Trust’s (BNY) (the “Trust”) investment objective is to provide current income exempt from regular U.S. federal income tax and New York State and New York City personal income taxes. The Trust seeks to achieve its investment objective by investing primarily in municipal bonds exempt from U.S. federal income taxes (except that the interest may be subject to the federal alternative minimum tax) and New York State and New York City personal income taxes. The Trust invests at least 80% of its assets in municipal bonds that are investment grade quality, or are considered by the Trust’s investment adviser to be of comparable quality, at the time of investment. The Trust may invest directly in securities or synthetically through the use of derivatives.

On June 16, 2020, the Board of Directors or the Board of Trustees, as applicable, of BlackRock New York Municipal Income Quality Trust (BSE) and BlackRock New York Municipal Income Trust II (BFY) and the Trust each approved the reorganizations of BSE and BFY into BNY. At a special shareholder meeting on January 21, 2021, the requisite shareholders of the Trust, BSE and BFY approved the reorganization, which was effective April 12, 2021.

No assurance can be given that the Trust’s investment objective will be achieved.

Trust Information

 

   

Symbol on New York Stock Exchange

  BNY

Initial Offering Date

  July 27, 2001

Yield on Closing Market Price as of July 31, 2021 ($15.49)(a)

  4.38%

Tax Equivalent Yield(b)

  8.69%

Current Monthly Distribution per Common Share(c)

  $0.0565

Current Annualized Distribution per Common Share(c)

  $0.6780

Leverage as of July 31, 2021(d)

  40%

 

  (a) 

Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. Past performance is not an indication of future results.

 
  (b) 

Tax equivalent yield assumes the maximum marginal U.S. federal and state tax rate of 49.62%, which includes the 3.8% Medicare tax. Actual tax rates will vary based on income, exemptions and deductions. Lower taxes will result in lower tax equivalent yields.

 
  (c) 

The distribution rate is not constant and is subject to change.

 
  (d) 

Represents VRDP Shares and TOB Trusts as a percentage of total managed assets, which is the total assets of the Trust, including any assets attributable to VRDP Shares and TOB Trusts, minus the sum of its accrued liabilities. Does not reflect derivatives or other instruments that may give rise to economic leverage. For a discussion of leveraging techniques utilized by the Trust, please see The Benefits and Risks of Leveraging and Derivative Financial Instruments.

 

Market Price and Net Asset Value Per Share Summary

 

     07/31/21      07/31/20      Change      High      Low  

Closing Market Price

  $ 15.49      $ 14.10        9.86    $ 16.07      $ 13.34  

Net Asset Value

    15.30        15.09        1.39        15.41        14.69  

TOTAL RETURN BASED ON A $10,000 INVESTMENT

 

 

LOGO

 

  (a) 

Represents the Trust’s closing market price on the NYSE and reflects the reinvestment of dividends and/or distributions at actual reinvestment prices.

 
  (b) 

A broad, market value-weighted index that seeks to measure the performance of the U.S. municipal bond market.

 

 

 

12  

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Trust Summary  as of July 31, 2021 (continued)    BlackRock New York Municipal Income Trust (BNY)

 

Performance Summary for the Period Ended July 31, 2021

Returns for the period ended July 31, 2021 were as follows:

 

    Average Annual Total Returns  
         1 Year      5 Years      10 Years  

Trust at NAV(a)(b)

    6.55      3.78      6.39

Trust at Market Price(a)(b)

    15.45        3.06        6.27  

Lipper New York Municipal Debt Funds at NAV(c)

    6.89        3.84        5.95  

Lipper New York Municipal Debt Funds at Market Price(c)

    14.29        3.26        6.36  

S&P® Municipal Bond Index

    3.47        3.34        4.29  

 

  (a) 

All returns reflect reinvestment of dividends and/or distributions at actual reinvestment prices. Performance results reflect the Trust’s use of leverage.

 
  (b) 

The Trust moved from a discount to NAV to a premium during the period, which accounts for the difference between performance based on market price and performance based on NAV.

 
  (c) 

Average return. Returns reflect reinvestment of dividends and/or distributions at NAV on the ex-dividend date as calculated by Lipper.

 

Performance results may include adjustments made for financial reporting purposes in accordance with U.S. generally accepted accounting principles. Past performance is not an indication of future results.

More information about the Trust’s historical performance can be found in the “Closed End Funds” section of blackrock.com.

The following discussion relates to the Trust’s absolute performance based on NAV:

Despite rising yields (and falling prices) for U.S. Treasuries, municipal bonds produced healthy gains in the past 12 months. Tax-exempt bonds continued to rally off of their pandemic-driven lows due to the release of multiple coronavirus vaccines, better-than-expected growth, improving municipal finances and robust investor demand. The prospect of substantial fiscal stimulus and higher taxes were additional tailwinds for the market. These factors led to a decline in yield spreads versus U.S. Treasuries, fueling positive returns for municipal debt.

New York municipal bonds exceeded the return of the national indexes. The state, which experienced an above-average impact from the coronavirus-induced downturn, outperformed in the subsequent recovery.

Income and the compression of yield spreads played the largest role in the Trust’s positive return. Yield curve positioning further aided performance due to the strong showing for longer-dated securities with maturities of 20 years and above. From a credit quality standpoint, positions in A and AA rated securities were key contributors. Additionally, lower-rated holdings—particularly Puerto Rico—performed well on the strength of investors’ robust appetite for yield. At the sector level, holdings in transportation, local tax-backed and state tax-backed issues added to performance.

The use of leverage, which added to the Trust’s income and amplified the effect of rising prices, was a further positive. The Trust sought to manage interest rate risk using U.S. Treasury futures. Given that long-term U.S. Treasury yields rose, as prices fell, this strategy contributed to performance.

Reinvestment risk remained a headwind since the proceeds from bonds that matured or were called needed to be reinvested at lower yields compared to bonds that were issued when yields were higher. In addition, holdings in short-duration, seasoned issues—including pre-refunded securities—underperformed relative to longer-dated maturities.

The views expressed reflect the opinions of BlackRock as of the date of this report and are subject to change based on changes in market, economic or other conditions. These views are not intended to be a forecast of future events and are no guarantee of future results.

 

 

R U S T    U M M A R Y

  13


Trust Summary  as of July 31, 2021 (continued)    BlackRock New York Municipal Income Trust (BNY)

 

Overview of the Trust’s Total Investments

 

SECTOR ALLOCATION

 

Sector(a)(b)

 

07/31/21

   

07/31/20

 

Transportation

    24     24

County/City/Special District/School District

    22       23  

Utilities

    14       13  

State

    14       11  

Education

    11       13  

Housing

    5       4  

Health

    5       7  

Corporate

    3       3  

Tobacco

    2       2  

CALL/MATURITY SCHEDULE

 

Calendar Year Ended December 31,(a)(c)

 

Percentage

 

2021

    6

2022

    8  

2023

    11  

2024

    8  

2025

    4  

CREDIT QUALITY ALLOCATION

 

Credit Rating(a)(d)

 

07/31/21

   

07/31/20

 

AAA/Aaa

    10     10

AA/Aa

    50       48  

A

    24       24  

BBB/Baa

    5       8  

BB/Ba

    1       1  

B

    1       1  

CC

          (e) 

N/R(f)

    9       8  
 

 

(a) 

Excludes short-term securities.

(b) 

For Trust compliance purposes, the Trust’s sector classifications refer to one or more of the sector sub-classifications used by one or more widely recognized market indexes or rating group indexes, and/or as defined by the investment adviser. These definitions may not apply for purposes of this report, which may combine such sector sub-classifications for reporting ease.

(c) 

Scheduled maturity dates and/or bonds that are subject to potential calls by issuers over the next five years.

(d) 

For financial reporting purposes, credit quality ratings shown above reflect the highest rating assigned by either S&P Global Ratings or Moody’s Investors Service, Inc. if ratings differ. These rating agencies are independent, nationally recognized statistical rating organizations and are widely used. Investment grade ratings are credit ratings of BBB/Baa or higher. Below investment grade ratings are credit ratings of BB/Ba or lower. Investments designated N/R are not rated by either rating agency. Unrated investments do not necessarily indicate low credit quality. Credit quality ratings are subject to change.

(e) 

Rounds to less than 1% of total investments.

(f) 

The investment adviser evaluates the credit quality of unrated investments based upon certain factors including, but not limited to, credit ratings for similar investments and financial analysis of sectors and individual investments. Using this approach, the investment adviser has deemed certain of these unrated securities as investment grade quality. As of July 31, 2021 and July 31, 2020, the market value of unrated securities deemed by the investment adviser to be investment grade represents 2% and 1%, respectively, of the Trust’s total investments.

 

 

14  

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Schedule of Investments  

July 31, 2021

  

BlackRock California Municipal Income Trust (BFZ)

(Percentages shown are based on Net Assets)

 

Security   Par
(000)
    Value  

Municipal Bonds

   

California — 88.5%

   
Corporate — 0.6%            

California Municipal Finance Authority, RB, Series A, AMT, 4.00%, 07/15/29

  $  2,640     $ 3,077,712  
   

 

 

 
County/City/Special District/School District — 21.0%  

California Statewide Communities Development Authority, SAB

   

Series A, 5.00%, 09/02/39

    275       342,202  

Series A, 5.00%, 09/02/44

    160       196,686  

Series A, 5.00%, 09/02/48

    160       194,294  

California Statewide Communities Development Authority, SAB, S/F Housing

   

5.00%, 09/02/40

    300       369,450  

4.00%, 09/02/50

    240       266,443  

5.00%, 09/02/50

    240       291,118  

Series C, 5.00%, 09/02/44

    595       731,428  

City of San Jose California Hotel Tax
Revenue, RB

   

6.13%, 05/01/31

    500       501,835  

6.50%, 05/01/36

    1,210       1,214,719  

6.50%, 05/01/42

    2,225       2,233,522  

El Dorado Irrigation District, Refunding RB, Series A, (AGM), 5.25%, 03/01/24(a)

    9,000           10,184,670  

Foothill-De Anza Community College District, Refunding GO, Series A, 3.00%, 08/01/39

    4,940       5,623,400  

Fremont Union High School District, GO, Series A, 4.00%, 08/01/40

    3,000       3,526,380  

Glendale Community College District, GO, Series A, 5.25%, 08/01/41

    5,000       6,299,150  

Hayward Area Recreation & Park District, Refunding GO, Series A, 5.00%, 08/01/42

    4,950       6,164,581  

Los Angeles County Metropolitan Transportation Authority, Refunding RB, Series A, 5.00%, 07/01/42

    5,030       6,241,727  

Orange County Community Facilities District, ST

   

4.00%, 08/15/40

    260       300,004  

4.00%, 08/15/50

    245       280,062  

Riverside County Public Financing Authority, RB, 5.25%, 11/01/45

    8,990       10,671,130  

Sacramento Area Flood Control Agency, Refunding SAB, 5.00%, 10/01/41

    8,000       9,663,840  

San Diego Unified School District, GO

   

Series D2, 4.00%, 07/01/50

    7,000       8,393,490  

Series L, 4.00%, 07/01/49

    3,000       3,580,980  

San Diego Unified School District, GO, CAB, Series C, 0.00%, 07/01/40(b)

    7,215       5,003,747  

San Francisco Bay Area Rapid Transit District, GO, Series B-1, 3.00%, 08/01/49

    9,965       10,921,441  

San Jose Financing Authority, Refunding RB, Series A, 5.00%, 06/01/23(a)

    2,000       2,177,960  

San Leandro Unified School District, GO, Series A, 5.75%, 08/01/41

    3,060       3,060,000  

Santa Monica Public Financing Authority, RB, 5.00%, 07/01/42

    1,250       1,544,037  

West Contra Costa Unified School District, GO, Series A, 5.50%, 08/01/23(a)

    2,500       2,769,850  

West Valley-Mission Community College District, GO, Series A, 4.00%, 08/01/44

    3,670       4,407,009  
   

 

 

 
      107,155,155  
Education — 5.7%            

California Enterprise Development Authority, RB(c) Series A, 5.00%, 07/01/50

    1,200       1,342,356  
Security   Par
(000)
    Value  
Education (continued)            

California Enterprise Development Authority,
RB(c) (continued)
Series A, 5.00%, 07/01/55

  $ 600     $ 666,798  

California Enterprise Development Authority, Refunding RB(c)

   

4.00%, 06/01/36

    250       296,757  

4.00%, 06/01/61

    500       563,725  

California Municipal Finance Authority, RB(c)

   

Series A, 5.00%, 10/01/39

    220       252,864  

Series A, 5.00%, 10/01/49

    370       416,043  

Series A, 5.00%, 10/01/57

    725       807,512  

California Municipal Finance Authority,
Refunding RB

   

5.00%, 08/01/34

    750       868,800  

5.00%, 08/01/39

    425       485,754  

5.00%, 08/01/48

    615       690,059  

California Public Finance Authority, RB, Series A, 5.00%, 07/01/54(c)

    285       302,624  

California School Finance Authority, RB(c)

   

5.00%, 06/01/40

    270       307,765  

4.00%, 06/01/41

    600       656,310  

5.00%, 06/01/50

    430       480,396  

5.00%, 06/01/59

    685       758,665  

Series A, 5.00%, 06/01/49

     1,000       1,096,660  

Series A, 5.00%, 06/01/58

    2,120       2,351,674  

California Statewide Communities Development Authority, RB, 5.00%, 06/01/51(c)

    240       287,369  

Hastings Campus Housing Finance Authority, RB

   

Series A, 5.00%, 07/01/45

    600       730,710  

Series A, 5.00%, 07/01/61

    3,600       4,290,660  

University of California, Refunding RB

   

Series AR, 5.00%, 05/15/38

    4,250       5,150,490  

Series AZ, 5.00%, 05/15/43

    5,035       6,397,370  
   

 

 

 
          29,201,361  
Health — 3.8%            

California Health Facilities Financing Authority, Refunding RB

   

Series A, 5.25%, 11/01/41

    8,500       8,607,525  

Series A, 4.00%, 04/01/49

    3,000       3,545,310  

Series A, 4.00%, 08/15/50

    2,000       2,401,980  

Series B, 5.00%, 11/15/46

    3,275       3,966,451  

California Municipal Finance Authority, Refunding RB(c)

   

Series A, 5.00%, 11/01/39

    195       226,046  

Series A, 5.00%, 11/01/49

    220       250,901  

California Public Finance Authority, RB(c)

   

5.00%, 11/15/36

    120       142,227  

5.00%, 11/15/46

    120       139,553  

5.00%, 11/15/51

    120       139,042  

5.00%, 11/15/56

    120       138,534  
   

 

 

 
      19,557,569  
Housing — 3.7%            

California Community Housing Agency, RB, M/F Housing(c)

   

4.00%, 08/01/46

    660       738,896  

3.00%, 08/01/56

    1,205       1,257,996  

Series A, 5.00%, 04/01/49

    2,770       3,174,614  

Series A, 4.00%, 02/01/56

    2,145       2,347,927  

Series A-2, 4.00%, 08/01/47

    2,060       2,280,461  

California Housing Finance, RB, M/F Housing, Series A, 4.25%, 01/15/35

    1       885  

CSCDA Community Improvement Authority, RB, M/F Housing 2.65%, 12/01/46(c)

    1,410       1,458,335  
 

 

 

C H E D U L E    O F    N V E S T  M E N T S

  15


Schedule of Investments  (continued)

July 31, 2021

  

BlackRock California Municipal Income Trust (BFZ)

(Percentages shown are based on Net Assets)

 

Security   Par
(000)
    Value  
Housing (continued)            

CSCDA Community Improvement Authority, RB, M/F Housing (continued)

   

4.00%, 07/01/56(c)

  $ 1,150     $ 1,255,903  

4.00%, 08/01/56(c)

    1,455       1,623,896  

3.00%, 12/01/56

    1,155       1,199,190  

Series A, 5.00%, 07/01/51(c)

    1,015       1,204,095  

Series A-2, 4.00%, 09/01/56(c)

    2,055       2,300,223  
   

 

 

 
      18,842,421  
State — 10.3%            

California State Public Works Board, RB

   

Series F, 5.25%, 09/01/33

    4,335       4,779,468  

Series I, 5.50%, 11/01/33

    4,940       5,514,967  

California State Public Works Board, Refunding RB, Series C, 5.00%, 11/01/34

    7,750       9,516,225  

City of Roseville California, ST, 4.00%, 09/01/45

    350       397,309  

State of California, Refunding GO

   

5.00%, 08/01/37

    13,000       16,595,670  

3.00%, 10/01/37

     14,000       15,591,100  
   

 

 

 
          52,394,739  
Tobacco — 5.0%            

California County Tobacco Securitization Agency, Refunding RB

   

4.00%, 06/01/49

    245       291,606  

5.00%, 06/01/50

    275       329,032  

Series A, 4.00%, 06/01/49

    355       423,583  

California County Tobacco Securitization Agency,
Refunding RB, CAB(b)
0.00%, 06/01/55

    2,425       612,676  

Series B-2, Subordinate, 0.00%, 06/01/55

    3,635       740,886  

Golden State Tobacco Securitization Corp., Refunding RB

   

Series A-1, 5.00%, 06/01/47

    475       490,965  

Series A-2, 5.00%, 06/01/47

    18,670       19,297,499  

Tobacco Securitization Authority of Southern California, Refunding RB, 5.00%, 06/01/48

    2,635       3,230,536  
   

 

 

 
      25,416,783  
Transportation — 22.0%            

City & County of San Francisco California, RB, (FNMA COLL), 2.55%, 07/01/39

    5,000       5,329,700  

City of Los Angeles Department of Airports, ARB

   

Series A, AMT, 5.00%, 05/15/29

    2,045       2,214,960  

Series A, AMT, 5.00%, 05/15/37

    3,520       4,381,344  

Series A, AMT, 5.00%, 05/15/44

    5,885       7,280,392  

Series B, AMT, 5.00%, 05/15/36

    2,600       3,108,612  

Sub-Series A, AMT, 5.00%, 05/15/42

    26,875       31,882,619  

City of Los Angeles Department of Airports, Refunding ARB, Series A, AMT, Subordinate, 5.00%, 05/15/38

    5,000       6,330,300  

City of Los Angeles Department of Airports, Refunding RB, Series A, 5.00%, 05/15/39

    4,060       5,293,306  

County of Sacramento California Airport System Revenue, Refunding RB, Series A, 5.00%, 07/01/41

    13,500       16,273,170  

Port of Los Angeles, Refunding ARB, Series A, AMT, 5.00%, 08/01/44

    4,135       4,657,416  

San Francisco City & County Airport Comm-San Francisco International Airport, Refunding ARB Series A, AMT, 5.00%, 05/01/42

    16,735       20,252,864  
Security   Par
(000)
    Value  
Transportation (continued)            

San Francisco City & County Airport Comm-San Francisco International Airport, Refunding ARB (continued)

   

Series D, AMT, 5.25%, 05/01/48

  $ 2,250     $ 2,805,165  

Series E, AMT, 5.00%, 05/01/40

    2,000       2,509,800  
   

 

 

 
      112,319,648  
Utilities — 16.4%            

City of San Francisco California Public Utilities Commission Water Revenue, Refunding RB

   

Series A, 5.00%, 11/01/50

    10,000       13,041,200  

Series D, 5.00%, 11/01/32

    5,000       6,335,500  

East Bay Municipal Utility District Water System Revenue, RB

   

Series A, 5.00%, 06/01/45

    3,245       3,996,509  

Series C, 4.00%, 06/01/45

    4,000       4,469,920  

Los Angeles Department of Water, RB

   

Series A, 5.00%, 07/01/42

    10,670       13,107,135  

Series B, 5.00%, 07/01/38

    3,000       3,583,590  

Los Angeles Department of Water, Refunding RB

   

Series A, 5.00%, 07/01/41

    5,000       6,128,050  

Series A, 5.00%, 07/01/44

    1,500       1,839,615  

Series A, 5.25%, 07/01/44

    3,000       3,718,890  

Series B, 5.00%, 07/01/43

    7,150       9,074,065  

San Francisco City & County Public Utilities Commission Wastewater Revenue, RB, Series B, 5.00%, 10/01/43

     2,485       3,113,084  

Santa Clara Valley Water District, Refunding RB, Series A, 5.00%, 06/01/45

    2,890       3,800,090  

South Coast Water District Financing Authority, Refunding RB, Series A, 5.00%, 02/01/44

    9,130       11,686,400  
   

 

 

 
      83,894,048  
   

 

 

 

Total Municipal Bonds in California

        451,859,436  
Puerto Rico — 5.8%            
State — 4.7%            

Puerto Rico Sales Tax Financing Corp. Sales Tax Revenue, RB

   

Series A-1, Restructured, 4.75%, 07/01/53

    2,845       3,272,746  

Series A-1, Restructured, 5.00%, 07/01/58

    10,154       11,830,730  

Series A-2, Restructured, 4.33%, 07/01/40

    2,588       2,939,580  

Series A-2, Restructured, 4.78%, 07/01/58

    2,530       2,908,994  

Puerto Rico Sales Tax Financing Corp. Sales Tax Revenue, RB, CAB, Series A-1, Restructured, 0.00%, 07/01/46(b)

    8,577       2,865,404  
   

 

 

 
      23,817,454  
Tobacco — 0.1%            

Children’s Trust Fund, Refunding RB, 5.50%, 05/15/39

    505       517,468  
   

 

 

 
Utilities — 1.0%            

Puerto Rico Commonwealth Aqueduct & Sewer Authority, RB

   

Series A, Senior Lien, 5.00%, 07/01/33

    3,865       4,002,478  

Series A, Senior Lien, 5.13%, 07/01/37

    1,105       1,142,968  
   

 

 

 
      5,145,446  
   

 

 

 

Total Municipal Bonds in Puerto Rico

      29,480,368  
   

 

 

 

Total Municipal Bonds — 94.3%
(Cost: $437,329,201)

      481,339,804  
   

 

 

 
 

 

 

16  

2 0 2 1    B L A C K O  C K    N N U A L    E P O R T    T O    H A  R E H O L D E R S


Schedule of Investments  (continued)

July 31, 2021

  

BlackRock California Municipal Income Trust (BFZ)

    (Percentages shown are based on Net Assets)

 

Security  

Par

(000)

    Value  

Municipal Bonds Transferred to Tender Option Bond Trusts(d)

 

California — 66.0%

 

County/City/Special District/School District — 23.6%  

Los Angeles County Metropolitan Transportation Authority, Refunding RB, Series A,
5.00%, 07/01/44

  $  11,200     $ 14,266,336  

Palomar Community College District, GO, Series C, 5.00%, 08/01/25(a)

    15,140       17,972,543  

San Diego Unified School District, GO, Series I, 5.00%, 07/01/47

    10,000       12,370,600  

San Francisco Bay Area Rapid Transit District, GO, Series A, 5.00%, 08/01/47

    10,615       13,095,936  

San Joaquin Delta Community College District, GO, Series C, 5.00%, 08/01/24(a)

    14,505       16,581,673  

San Jose Unified School District, GO, Series C, 4.00%, 08/01/24(a)

    6,100       6,797,535  

Santa Clara County Financing Authority, RB, Series A, 4.00%, 05/01/45

    22,230       26,683,336  

Santa Monica Community College District, GO, Series A, 5.00%, 08/01/43

    10,000       12,702,100  
   

 

 

 
        120,470,059  

Education — 14.9%

   

California State University, Refunding RB, Series A, 5.00%, 11/01/43

    11,792       13,964,960  

University of California, RB

   

Series AM, 5.25%, 05/15/44

    5,000       5,677,632  

Series M, 5.00%, 05/15/42

    10,000       12,318,100  

University of California, Refunding RB

   

Series AI, 5.00%, 05/15/38

    14,225       15,429,717  

Series AR, 5.00%, 05/15/41

    10,165       12,287,961  

Series I, 5.00%, 05/15/40

    14,065       16,370,396  
   

 

 

 
      76,048,766  

Health — 8.6%

   

California Health Facilities Financing Authority, RB(a)

   

Series A, 5.00%, 08/15/23

    9,695       10,662,657  

Series A, 5.00%, 11/15/25

    11,620       13,931,218  

California Statewide Communities Development Authority, RB, Series A, 5.00%, 04/01/42

    18,960       19,550,225  
   

 

 

 
      44,144,100  
Security  

Par

(000)

    Value  
State — 3.9%            

State of California, Refunding GO, 4.00%, 10/01/39

  $  16,620     $ 20,141,446  
   

 

 

 

Transportation — 8.7%

   

City & County of San Francisco California, Refunding COP, Series A, 4.00%, 04/01/43

    10,865       12,663,911  

City of Los Angeles Department of Airports, ARB, AMT, Series D, 5.00%, 05/15/41

    18,632       21,554,863  

San Francisco City & County Airport Comm-San Francisco International Airport, Refunding ARB, AMT, Series B, 5.00%, 05/01/41

    8,720       10,346,890  
   

 

 

 
      44,565,664  

Utilities — 6.3%

   

Los Angeles Department of Water, Refunding RB, Series A, 5.00%, 07/01/46

    6,412       7,615,404  

Sacramento Municipal Utility District, Refunding RB, Series H, 4.00%, 08/15/45

    20,000       24,317,000  
   

 

 

 
      31,932,404  
   

 

 

 

Total Municipal Bonds in California

      337,302,439  
   

 

 

 

Total Municipal Bonds Transferred to Tender Option Bond Trusts — 66.0%

   

(Cost: $309,650,676)

      337,302,439  
   

 

 

 

Total Investments — 160.3%

 

 

(Cost: $746,979,877)

 

    818,642,243  

Other Assets Less Liabilities — 1.3%

 

    6,623,124  

Liability for TOB Trust Certificates, Including Interest Expense and Fees Payable — (28.1)%.

 

    (143,309,737

VMTP Shares at Liquidation Value — (33.5)%

 

    (171,300,000
   

 

 

 

Net Assets Applicable to Common Shares — 100.0%

    $   510,655,630  
   

 

 

 

 

(a) 

U.S. Government securities held in escrow, are used to pay interest on this security as well as to retire the bond in full at the date indicated, typically at a premium to par.

(b) 

Zero-coupon bond.

(c) 

Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registration to qualified institutional investors.

(d) 

Represent bonds transferred to a TOB Trust in exchange of cash and residual certificates received by the Trust. These bonds serve as collateral in a secured borrowing. See Note 4 of the Notes to Financial Statements for details.

 

 

For Trust compliance purposes, the Trust’s sector classifications refer to one or more of the sector sub-classifications used by one or more widely recognized market indexes or rating group indexes, and/or as defined by the investment adviser. These definitions may not apply for purposes of this report, which may combine such sector sub-classifications for reporting ease.

Affiliates

Investments in issuers considered to be affiliate(s) of the Trust during the year ended July 31, 2021 for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:

 

Affiliated Issuer    Value at
07/31/20
     Purchases
at Cost
     Proceeds
from Sales
     Net
Realized
Gain (Loss)
     Change in
Unrealized
Appreciation
(Depreciation)
     Value at
07/31/21
     Shares
Held at
07/31/21
     Income      Capital Gain
Distributions
from
Underlying
Funds
 

BlackRock Liquidity Funds California Money Fund, Institutional Class(a)

   $ 614,041      $      $ (615,295 )(b)     $ 1,254      $      $             $ 302      $  
           

 

 

    

 

 

    

 

 

       

 

 

    

 

 

 

 

  (a) 

As of period end, the entity is no longer held.

 
  (b) 

Represents net amount purchased (sold).

 

 

 

C H E D U L E     O F    N V E S  T M E N T S

  17


Schedule of Investments  (continued)    BlackRock California Municipal Income Trust (BFZ)
July 31, 2021   

 

Derivative Financial Instruments Outstanding as of Period End

Futures Contracts

 

         
Description    Number of
Contracts
     Expiration
Date
     Notional
Amount (000)
     Value/
Unrealized
Appreciation
(Depreciation)
 

Short Contracts

           

10-Year U.S. Treasury Note

     129        09/21/21      $ 17,355      $ (224,218

U.S. Long Bond

     78        09/21/21        12,868        (501,375

5-Year U.S. Treasury Note

     113        09/30/21        14,067        (92,319
           

 

 

 
            $ (817,912
           

 

 

 

Derivative Financial Instruments Categorized by Risk Exposure

As of period end, the fair values of derivative financial instruments located in the Statements of Assets and Liabilities were as follows:

 

               
      Commodity
Contracts
     Credit
Contracts
     Equity
Contracts
     Foreign
Currency
Exchange
Contracts
     Interest
Rate
Contracts
     Other
Contracts
     Total  

Liabilities — Derivative Financial Instruments

                    

Futures contracts

                    

Unrealized depreciation on futures contracts(a)

   $      $      $      $      $     817,912      $      $  817,912  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

  (a)

Net cumulative unrealized appreciation (depreciation) on futures contracts and centrally cleared swaps, if any, are reported in the Schedule of Investments. In the Statements of Assets and Liabilities, only current day’s variation margin is reported in receivables or payables and the net cumulative unrealized appreciation (depreciation) is included in accumulated earnings (loss).

 

For the year ended July 31, 2021, the effect of derivative financial instruments in the Statements of Operations was as follows:

 

               
      Commodity
Contracts
     Credit
Contracts
     Equity
Contracts
     Foreign
Currency
Exchange
Contracts
     Interest
Rate
Contracts
     Other
Contracts
     Total  

Net Realized Gain (Loss) from

                    

Futures contracts

   $      $      $      $      $ 1,319,056      $      $ 1,319,056  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net Change in Unrealized Appreciation (Depreciation) on

                    

Futures contracts

   $      $      $      $      $ (817,912    $      $ (817,912
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Average Quarterly Balances of Outstanding Derivative Financial Instruments

 

   

Futures contracts

  

Average notional value of contracts — short

   $ 35,878,504  

For more information about the Trust’s investment risks regarding derivative financial instruments, refer to the Notes to Financial Statements.

 

 

18  

2 0 2 1    B L A C K O  C K    N N U A L    E P O R T    T O    H A  R E H O L D E R S


Schedule of Investments  (continued)    BlackRock California Municipal Income Trust (BFZ)
July 31, 2021   

 

Fair Value Hierarchy as of Period End

Various inputs are used in determining the fair value of financial instruments. For a description of the input levels and information about the Trust’s policy regarding valuation of financial instruments, refer to the Notes to Financial Statements.

The following table summarizes the Trust’s financial instruments categorized in the fair value hierarchy. The breakdown of the Trust’s financial instruments into major categories is disclosed in the Schedule of Investments above.

 

         
      Level 1        Level 2        Level 3        Total  

Assets

                 

Investments

                 

Long-Term Investments

                 

Municipal Bonds

   $        $  481,339,804        $        $  481,339,804  

Municipal Bonds Transferred to Tender Option Bond Trusts

              337,302,439                   337,302,439  
  

 

 

      

 

 

      

 

 

      

 

 

 
   $        $   818,642,243        $        $  818,642,243  
  

 

 

      

 

 

      

 

 

      

 

 

 

Derivative Financial Instruments(a)

                 

Liabilities

                 

Interest Rate Contracts

   $     (817,912)        $        $        $ (817,912
  

 

 

      

 

 

      

 

 

      

 

 

 

 

  (a)

Derivative financial instruments are futures contracts. Futures contracts are valued at the unrealized appreciation (depreciation) on the instrument.

 

The Trust may hold assets and/or liabilities in which the fair value approximates the carrying amount for financial statement purposes. As of period end, such assets and/or liabilities are categorized within the fair value hierarchy as follows:

 

         
      Level 1        Level 2        Level 3        Total  

Liabilities

                 

TOB Trust Certificates

   $        $  (143,275,836)        $        $  (143,275,836)  

VMTP Shares at Liquidation Value

              (171,300,000)                   (171,300,000)  
  

 

 

      

 

 

      

 

 

      

 

 

 
   $                 —        $  (314,575,836)        $        $  (314,575,836)  
  

 

 

      

 

 

      

 

 

      

 

 

 

See notes to financial statements.

 

 

C H E D U L E    O F    N V E S T  M E N T S

  19


Schedule of Investments

July 31, 2021

  

BlackRock Municipal 2030 Target Term Trust (BTT)

(Percentages shown are based on Net Assets)

 

Security  

Par

(000)

    Value  

Municipal Bonds

   

Alabama — 3.6%

   

Alabama Federal Aid Highway
Finance Authority, RB

   

Series A, 5.00%, 09/01/33

  $ 3,985     $ 4,992,249  

Series A, 5.00%, 09/01/34

    3,500       4,379,445  

Alabama Public School and College Authority, Refunding RB, Series A, 5.00%, 11/01/30

     11,900       16,260,160  

Alabama Special Care Facilities Financing Authority- Birmingham Alabama, Refunding RB, 5.00%, 06/01/30

    10,000       11,680,500  

Birmingham-Jefferson Civic Center Authority, ST

   

Series A, 5.00%, 07/01/31

    1,100       1,352,736  

Series A, 5.00%, 07/01/32

    1,150       1,408,416  

Series A, 5.00%, 07/01/33

    1,600       1,953,536  

Black Belt Energy Gas District, Refunding RB, 4.00%, 06/01/51(a)

    8,930       11,262,427  

County of Jefferson Alabama Sewer Revenue, Refunding RB, CAB(b)

   

Series B, Senior Lien, (AGM),

0.00%, 10/01/31

    7,375       4,621,101  

Series B, Senior Lien, (AGM),

0.00%, 10/01/32

    6,295       3,662,242  

Series B, Senior Lien, (AGM),

0.00%, 10/01/33

    1,275       690,782  

Homewood Educational Building Authority, Refunding RB

   

Series A, 5.00%, 12/01/33

    1,010       1,241,482  

Series A, 5.00%, 12/01/34

    1,380       1,693,881  

University of South Alabama, Refunding RB

   

(AGM), 5.00%, 11/01/29

    1,105       1,339,293  

(AGM), 5.00%, 11/01/30

    2,000       2,421,540  
   

 

 

 
          68,959,790  
Arizona — 1.9%            

Arizona Health Facilities Authority, Refunding RB

   

Series A, 5.00%, 02/01/34

    6,340       6,489,560  

Series B, 5.00%, 02/01/33

    1,810       1,937,533  

Arizona Industrial Development Authority, RB(c)

   

4.00%, 07/01/29

    705       790,545  

4.50%, 07/01/29

    765       818,787  

4.00%, 07/01/30

    685       749,630  

Series A, 4.00%, 07/01/29

    4,135       4,367,842  

Industrial Development Authority of the City of Phoenix, RB

   

6.00%, 07/01/23(d)

    190       205,861  

Series A, 4.50%, 07/01/22

    105       108,228  

Series A, 5.75%, 07/01/24(c)

    475       517,455  

Series A, 5.00%, 07/01/33

    1,000       1,026,470  

Industrial Development Authority of the County of Pima, Refunding RB, Series A,
4.00%, 09/01/29

    6,000       6,345,180  

Maricopa County Industrial Development Authority,
Refunding RB

   

4.00%, 07/01/29(c)

    855       979,933  

Series A, 5.00%, 01/01/31

    10,000       12,284,800  
   

 

 

 
      36,621,824  
California — 8.2%            

Alameda Corridor Transportation Authority, Refunding RB, Series A, Sub Lien, (AMBAC), 0.00%, 10/01/30(b)

    10,530       8,978,510  

California Health Facilities Financing Authority, RB

   

Series A, 5.00%, 11/15/32

    1,600       2,018,448  

Series A, 5.00%, 11/15/33

    1,855       2,332,180  
Security  

Par

(000)

    Value  
California (continued)            

California Housing Finance, RB, M/F Housing, Series 2021-1, Class A, 3.50%, 11/20/35

  $ 3,737     $ 4,456,711  

California Infrastructure & Economic Development Bank, Refunding RB, Series D,
0.37%, 08/01/47(a)

    2,675       2,680,425  

California Municipal Finance Authority, ARB, AMT, Senior Lien, 5.00%, 12/31/33

    4,000       5,013,760  

California Municipal Finance Authority, RB,
4.00%, 10/01/33

    2,500       2,652,750  

California Municipal Finance Authority, RB, S/F Housing, Series A, 5.00%, 08/15/30

    1,000       1,099,960  

California Municipal Finance Authority,
Refunding RB

   

Series A, 5.00%, 07/01/30

    1,200       1,482,720  

Series A, 5.00%, 07/01/31

    1,050       1,296,708  

California School Finance Authority, RB(c)

   

5.00%, 06/01/30

    565       659,886  

Series A, 5.00%, 06/01/29

    290       330,612  

Series A, 4.00%, 06/01/31

    265       295,263  

Series A, 5.00%, 06/01/32

    1,100       1,274,636  

City of Long Beach California Harbor Revenue, ARB

   

Series A, AMT, 5.00%, 05/15/31

    1,200       1,487,952  

Series A, AMT, 5.00%, 05/15/32

    1,800       2,230,236  

Series A, AMT, 5.00%, 05/15/33

    675       835,711  

Series A, AMT, 5.00%, 05/15/34

    1,650       2,041,264  

Compton Unified School District, GO, CAB(b)

   

Series B, (BAM), 0.00%, 06/01/33

    1,000       780,000  

Series B, (BAM), 0.00%, 06/01/34

    1,125       844,065  

Series B, (BAM), 0.00%, 06/01/35

    1,000       721,950  

Series B, (BAM), 0.00%, 06/01/36

    1,000       693,990  

El Camino Community College District Foundation, GO, CAB(b)

   

Series C, 0.00%, 08/01/30

    9,090       8,108,825  

Series C, 0.00%, 08/01/31

     12,465       10,850,658  

Series C, 0.00%, 08/01/32

    17,435       14,773,722  

Golden State Tobacco Securitization Corp., Refunding RB, Series A-1, 5.00%, 06/01/29

    14,500       17,967,530  

Los Angeles Regional Airports Improvement Corp., Refunding RB, AMT, 5.00%, 01/01/32

    4,110       4,189,446  

Los Angeles Unified School District, GO, Series A, 4.00%, 07/01/33

    3,000       3,406,710  

Monterey Peninsula Community College District, Refunding GO, CAB(b)

   

0.00%, 08/01/30

    3,500       2,908,150  

0.00%, 08/01/31

    5,940       4,756,217  

M-S-R Energy Authority, RB, Series C,
6.13%, 11/01/29

    2,445       3,110,187  

Norman Y Mineta San Jose International Airport SJC, Refunding RB

   

Series A, AMT, 5.00%, 03/01/30

    500       614,375  

Series A, AMT, 5.00%, 03/01/31

    1,500       1,841,850  

Series A, AMT, 5.00%, 03/01/32

    1,000       1,226,950  

Series A, AMT, 5.00%, 03/01/33

    975       1,195,282  

Series A, AMT, 5.00%, 03/01/34

    1,250       1,531,200  

Series A, AMT, 5.00%, 03/01/35

    2,000       2,447,940  

Poway Unified School District, GO(b)

   

Series A, 0.00%, 08/01/30

    10,000       8,891,300  

Series A, 0.00%, 08/01/32

    12,500           10,567,625  

San Diego County Regional Airport Authority, ARB, Sub-Series B, AMT, 5.00%, 07/01/33

    1,000       1,236,580  
 

 

 

20  

2 0 2 1    B L A C K O  C K    N N U A L    E P O R T    T O    H A  R E H O L D E R S


Schedule of Investments  (continued)

July 31, 2021

  

BlackRock Municipal 2030 Target Term Trust (BTT)

(Percentages shown are based on Net Assets)

 

Security  

Par

(000)

    Value  

California (continued)

   

State of California, Refunding GO,
5.00%, 08/01/30

  $  10,000     $ 12,609,400  

Washington Township Health Care District, Refunding RB, Series B, 3.00%, 07/01/28

    750       827,025  
   

 

 

 
      157,268,709  
Colorado — 3.4%            

Central Platte Valley Metropolitan District, GO

   

Series A, 5.13%, 12/01/29

    700       761,887  

Series A, 5.50%, 12/01/29

    750       822,743  

City & County of Denver Colorado Airport System Revenue, Refunding ARB, Series A, AMT, 5.00%, 12/01/33

    25,000       31,489,750  

City & County of Denver Colorado, RB, CAB, Series A-2, 0.00%, 08/01/30(b)

    1,000       826,390  

Colorado Educational & Cultural Facilities Authority, Refunding RB, 4.00%, 12/01/30(c)

    1,185       1,255,152  

Colorado Health Facilities Authority,
Refunding RB

   

4.00%, 05/15/26(e)

    2,860       3,349,060  

Series A, 5.00%, 12/01/22(e)

    3,000       3,194,580  

Series A, 4.00%, 08/01/37

    3,000       3,601,200  

E-470 Public Highway Authority, Refunding RB, Series B, 0.38%, 09/01/39(a)

    1,475       1,478,516  

Park Creek Metropolitan District, Refunding RB

   

Series A, Senior Lien, 5.00%, 12/01/27

    1,500       1,759,575  

Series A, Senior Lien, 5.00%, 12/01/28

    1,500       1,757,850  

Series A, Senior Lien, 5.00%, 12/01/30

    1,350       1,579,081  

Series A, Senior Lien, 5.00%, 12/01/31

    1,500       1,752,930  

Plaza Metropolitan District No.1, Refunding TA(c)

   

4.00%, 12/01/23

    1,000       1,034,140  

4.10%, 12/01/24

    5,080       5,254,752  

4.20%, 12/01/25

    5,280       5,462,530  

Tallyn’s Reach Metropolitan District No.3, GO, 5.00%, 12/01/23(e)

    502       558,751  
   

 

 

 
          65,938,887  
Connecticut — 1.0%            

Capital Region Development Authority, Refunding RB

   

(SAP), 5.00%, 06/15/30

    1,095       1,379,437  

(SAP), 5.00%, 06/15/31

    1,125       1,412,168  

Connecticut State Health & Educational Facilities Authority, RB, Series A,
5.00%, 01/01/30(c)

    370       416,498  

Connecticut State Health & Educational Facilities Authority, Refunding RB

   

Series 2015-A, 0.38%, 07/01/35(a)

    5,005       5,022,467  

Series G-1, 5.00%, 07/01/27(c)

    225       268,193  

Series G-1, 5.00%, 07/01/28(c)

    300       365,148  

Series G-1, 5.00%, 07/01/29(c)

    300       372,336  

Series G-1, 5.00%, 07/01/30(c)

    300       370,818  

Series G-1, 5.00%, 07/01/32(c)

    425       521,896  

Series G-1, 5.00%, 07/01/34(c)

    355       433,416  

Series I-1, 5.00%, 07/01/35

    400       484,664  

State of Connecticut, GO, Series A,
5.00%, 04/15/33

    7,000       8,895,530  
   

 

 

 
      19,942,571  
Delaware — 0.8%            

County of Kent Delaware, RB

   

Series A, 4.00%, 07/01/22

    230       235,808  

Series A, 5.00%, 07/01/24

    705       777,728  

Series A, 5.00%, 07/01/25

    805       913,232  

Series A, 5.00%, 07/01/26

    850       989,137  

Series A, 5.00%, 07/01/27

    890       1,060,159  
Security  

Par

(000)

    Value  

 

Delaware (continued)

           

County of Kent Delaware, RB (continued)

   

Series A, 5.00%, 07/01/28

  $ 935     $ 1,123,234  

Delaware State Economic Development Authority, Refunding RB(a)

   

Series A, 1.25%, 10/01/45

    6,035       6,148,156  

Series B, 1.25%, 10/01/40

    500       505,770  

Delaware State Health Facilities Authority, RB, 4.00%, 06/01/35

    1,250       1,478,500  

Delaware Transportation Authority, Refunding RB, 5.00%, 09/01/30

    2,000       2,693,160  
   

 

 

 
          15,924,884  
District of Columbia — 1.0%            

District of Columbia, Refunding RB, Series A, 6.00%, 07/01/23(e)

    1,700       1,888,683  

Metropolitan Washington Airports Authority Aviation Revenue, Refunding ARB, Series A, AMT, 5.00%, 10/01/30

    12,325       16,525,360  
   

 

 

 
      18,414,043  
Florida — 7.5%            

Capital Projects Finance Authority, RB, Series A-1, 5.00%, 10/01/30

    1,000       1,280,260  

Capital Trust Agency, Inc., RB(c)

   

Series A, 4.00%, 06/15/29

    1,790       1,914,727  

Series A-1, 3.38%, 07/01/31

    1,810       2,011,471  

Central Florida Expressway Authority,
Refunding RB

   

Senior Lien, 5.00%, 07/01/32

    1,610       2,052,315  

Senior Lien, 5.00%, 07/01/33

    2,750       3,493,600  

City of Lakeland Florida, Refunding RB, 5.00%, 11/15/30

    3,750       4,599,600  

City of Tampa Florida, Refunding RB, Series A, 4.00%, 09/01/33

     10,000       10,424,100  

County of Broward Florida, RB

   

Series A, AMT, (AGM), 5.00%, 04/01/30

    600       645,036  

Series A, AMT, (AGM), 5.00%, 04/01/33

    740       794,812  

County of Miami-Dade Florida Water & Sewer System Revenue, RB, 5.00%, 10/01/27

    5,000       6,322,100  

County of Miami-Dade Florida, Refunding RB, Series B, 4.00%, 04/01/32

    6,690       7,750,833  

County of Palm Beach Florida, RB, 5.00%, 04/01/29(c)

    1,000       1,125,830  

County of St. Johns Florida Water & Sewer Revenue, Refunding RB, CAB(b)

   

Series B, 0.00%, 06/01/30

    2,000       1,783,460  

Series B, 0.00%, 06/01/31

    1,295       1,127,414  

Series B, 0.00%, 06/01/32

    2,495       2,116,234  

Double Branch Community Development District, Refunding SAB, Series A-1, Senior Lien, 4.13%, 05/01/31

    1,200       1,275,312  

Florida Development Finance Corp., RB, AMT, 5.00%, 05/01/29(c)

    7,430       7,990,296  

Florida Development Finance Corp.,
Refunding RB

   

4.00%, 06/01/24

    105       111,539  

4.00%, 06/01/25

    100       107,895  

4.00%, 06/01/26

    110       120,107  

4.00%, 09/15/30(c)

    470       520,765  

Jacksonville Port Authority, Refunding ARB, AMT, 4.50%, 11/01/22(e)

    9,445       9,938,596  

Lakewood Ranch Stewardship District, Refunding SAB, 3.20%, 05/01/30(c)

    540       568,102  
 

 

 

C H E D U L E    O F    N V E S T  M E N T S

  21


Schedule of Investments  (continued)

July 31, 2021

  

BlackRock Municipal 2030 Target Term Trust (BTT)

(Percentages shown are based on Net Assets)

 

Security  

Par

(000)

    Value  

Florida (continued)

   

Lakewood Ranch Stewardship District, SAB, S/F Housing, 3.40%, 05/01/30

  $ 375     $ 399,218  

LT Ranch Community Development District, SAB, 3.40%, 05/01/30

    985       1,040,436  

Miami Beach Health Facilities Authority, Refunding RB, 5.00%, 11/15/30

    1,000       1,139,300  

Orange County Convention Center/Orlando, Refunding RB, 5.00%, 10/01/30

     11,470       15,505,375  

Palm Beach County Health Facilities Authority, RB, Series B, 5.00%, 05/15/31

    410       491,992  

Palm Beach County Health Facilities Authority, Refunding RB, 5.00%, 11/15/32

    16,805       20,271,871  

Reedy Creek Improvement District, GO, Series A, 5.25%, 06/01/23(e)

    3,825       4,182,217  

Sarasota National Community Development District, Refunding SAB, 3.50%, 05/01/31

    1,000       1,081,710  

School Board of Miami-Dade County, Refunding COP, Series A,
5.00%, 05/01/32

    9,000       10,796,760  

St. Johns County Industrial Development Authority, Refunding RB

   

4.00%, 12/15/28

    200       229,614  

4.00%, 12/15/29

    215       247,796  

4.00%, 12/15/30

    195       224,178  

4.00%, 12/15/31

    205       235,182  

Tolomato Community Development District, Refunding SAB, Sub-Series A-2,
3.85%, 05/01/29

    520       559,863  

Village Community Development District No.10, SAB

   

4.50%, 05/01/23

    785       797,741  

5.00%, 05/01/32

    5,125       5,206,077  

Village Community Development District No.5, Refunding SAB

   

3.50%, 05/01/28

    5,080       5,348,173  

4.00%, 05/01/33

    985       1,043,785  

4.00%, 05/01/34

    2,150       2,277,452  

Village Community Development District No.6, Refunding SAB, 4.00%, 05/01/29

    5,330       5,450,245  
   

 

 

 
        144,603,389  
Georgia — 1.6%            

Main Street Natural Gas, Inc., RB

   

Series A, 5.00%, 05/15/29

    1,250       1,589,363  

Series A, 5.00%, 05/15/30

    8,000       10,151,200  

Municipal Electric Authority of Georgia, RB, Series A, 5.00%, 01/01/34

    8,000       9,970,320  

Municipal Electric Authority of Georgia, Refunding RB

   

Series A, 5.00%, 01/01/29

    2,000       2,577,120  

Series A, 5.00%, 01/01/30

    1,905       2,500,827  

Series A, Subordinate, 5.00%, 01/01/29

    1,200       1,546,272  

Series A, Subordinate, 5.00%, 01/01/30

    1,250       1,640,962  
   

 

 

 
      29,976,064  
Guam — 0.2%            

Territory of Guam, Refunding RB

   

Series A, 5.00%, 11/01/30

    500       650,430  

Series F, 5.00%, 01/01/30(f)

    1,160       1,471,031  

Series F, 5.00%, 01/01/31(f)

    1,250       1,615,562  
   

 

 

 
      3,737,023  
Security  

Par

(000)

    Value  
Idaho — 0.0%            

Idaho Housing & Finance Association, RB, Series A, 4.63%, 07/01/29(c)

  $ 185     $ 212,178  
   

 

 

 
Illinois — 14.1%            

Chicago Board of Education, Refunding GO

   

Series C, 5.00%, 12/01/22

     14,830       15,705,711  

Series C, 5.00%, 12/01/30

    7,025       8,678,193  

Series F, 5.00%, 12/01/22

    4,760       5,041,078  

Chicago Housing Authority, RB, M/F Housing

   

Series A, (HUD SEC 8), 5.00%, 01/01/33

    3,000       3,638,040  

Series A, (HUD SEC 8), 5.00%, 01/01/35

    1,500       1,805,520  

Chicago Midway International Airport, Refunding ARB, Series A, AMT, 2nd Lien, 5.00%, 01/01/33

    5,000       5,518,600  

Chicago O’Hare International Airport,
Refunding RB

   

Series B, AMT, 4.00%, 01/01/27

    5,000       5,075,950  

Series B, Senior Lien, 5.00%, 01/01/33

    6,000       7,329,180  

Chicago Transit Authority Capital Grant Receipts Revenue, Refunding RB, 5.00%, 06/01/26

    3,000       3,632,750  

City of Chicago Illinois Motor Fuel Tax Revenue, Refunding RB, (AGM), 5.00%, 01/01/30

    730       793,313  

City of Chicago Illinois Wastewater Transmission Revenue, RB

   

2nd Lien, 4.00%, 01/01/31

    10,375       10,501,782  

2nd Lien, 4.00%, 01/01/32

    10,790       10,921,854  

2nd Lien, 4.00%, 01/01/33

    11,220       11,356,435  

2nd Lien, 4.00%, 01/01/35

    9,135       9,245,168  

City of St. Charles Illinois, Refunding GO

   

4.00%, 12/01/30

    1,620       1,701,454  

4.00%, 12/01/31

    1,715       1,800,870  

County of Cook Illinois, Refunding GO, Series C, 4.00%, 11/15/29

    19,750           20,692,865  

Illinois Finance Authority, Refunding RB

   

Series A, 4.00%, 11/01/24

    425       451,537  

Series A, 5.00%, 11/01/26

    460       525,762  

Series A, 5.00%, 11/01/28

    1,745       2,031,145  

Series A, 5.00%, 11/01/29

    1,840       2,137,583  

Series A, 5.00%, 10/01/30

    1,000       1,207,950  

Series A, 5.00%, 11/01/30

    1,935       2,243,516  

Series A, 5.00%, 11/15/31

    8,415       9,764,682  

Series A, 4.00%, 10/01/32

    1,000       1,152,010  

Series A, 5.00%, 11/15/32

    2,075       2,405,631  

Series A, 4.00%, 02/01/33

    11,000       11,633,270  

Series A, 5.00%, 11/15/33

    2,125       2,461,409  

Series B, 5.00%, 08/15/30

    3,205       3,915,516  

Series B, 0.72%, 05/01/42(a)

    1,750       1,754,130  

Series C, 5.00%, 02/15/30

    12,000       14,758,200  

Illinois State Toll Highway Authority, Refunding RB, Series A, 4.00%, 12/01/31

    20,000       22,998,600  

Kane McHenry Cook & De Kalb Counties Unit School District No.300, Refunding GO, Series A, 5.00%, 01/01/30

    6,350       7,793,165  

Metropolitan Pier & Exposition Authority, Refunding RB

   

5.00%, 12/15/28

    1,200       1,487,964  

5.00%, 12/15/30

    1,385       1,707,802  

State of Illinois, GO

   

Series A, 5.00%, 12/01/28

    9,950       12,381,183  

Series A, 5.00%, 03/01/32

    1,500       1,972,380  

Series A, 4.00%, 03/01/41

    335       396,486  
 

 

 

22  

2 0 2 1    B L A C K O  C K    N N U A L    E P O R T    T O    H A  R E H O L D E R S


Schedule of Investments  (continued)

July 31, 2021

  

BlackRock Municipal 2030 Target Term Trust (BTT)

(Percentages shown are based on Net Assets)

 

Security  

Par

(000)

    Value  

Illinois (continued)

   

State of Illinois, GO (continued)

   

Series D, 5.00%, 11/01/28

  $         10,805     $ 13,344,823  

State of Illinois, Refunding GO, Series B,
5.00%, 10/01/30

    7,000       8,799,560  

Upper Illinois River Valley Development Authority, Refunding RB, 4.00%, 01/01/31(c)

    370       396,337  

Winnebago & Boone Counties School District No.205 Rockford, GO

   

4.00%, 02/01/29

    9,080       9,560,150  

4.00%, 02/01/30

     9,835       10,352,616  
   

 

 

 
        271,072,170  
Indiana — 2.6%            

City of Indianapolis Department of Public Utilities Water System Revenue, Refunding RB, Series A, 1st Lien, 5.00%, 10/01/35

    10,000       12,737,000  

City of Valparaiso Indiana, RB, AMT,
5.88%, 01/01/24

    800       849,464  

City of Whiting Indiana, RB, Series A, AMT, 5.00%, 03/01/46(a)

    5,500       5,914,865  

Indiana Finance Authority, Refunding RB

   

Series A, 4.00%, 05/01/23(e)

    22,565       24,080,691  

Series A, 4.13%, 12/01/26

    3,665       4,066,318  

Northern Indiana Commuter Transportation District, RB

   

5.00%, 07/01/32

    1,000       1,206,080  

5.00%, 07/01/33

    1,400       1,687,112  
   

 

 

 
          50,541,530  
Iowa — 2.2%            

Iowa Finance Authority, RB, AMT,
1.50%, 01/01/42(a)

    2,750       2,779,123  

Iowa Finance Authority, Refunding RB,
5.25%, 12/01/25

    13,345       14,707,391  

PEFA, Inc., RB, 5.00%, 09/01/49(a)

    21,415       25,919,859  
   

 

 

 
      43,406,373  
Kansas — 0.1%            

City of Shawnee Kansas, RB, 4.00%, 08/01/31(c)

    500       528,000  

Wyandotte County-Kansas City Unified Government Utility System Revenue, RB, Series A, 5.00%, 09/01/33

    1,370       1,606,941  
   

 

 

 
      2,134,941  
Kentucky — 0.6%            

Kentucky Public Transportation Infrastructure Authority, RB, CAB

   

Series B, 0.00%, 07/01/30(b)

    1,230       960,778  

Series C, Convertible, 6.40%, 07/01/33(g)

    1,500       1,872,195  

Louisville/Jefferson County Metropolitan Government, Refunding RB, Series A,
5.00%, 10/01/32

    7,300       8,885,049  
   

 

 

 
      11,718,022  
Louisiana — 2.8%            

City of Ruston Louisiana, RB

   

(AGM), 5.00%, 06/01/29

    1,060       1,270,389  

(AGM), 5.00%, 06/01/30

    1,000       1,197,410  

(AGM), 5.00%, 06/01/31

    1,020       1,220,359  

(AGM), 5.00%, 06/01/32

    1,225       1,464,353  

Louisiana Local Government Environmental Facilities & Community Development Auth, Refunding RB, Series A, 2.00%, 06/01/30

    1,250       1,287,237  

Louisiana Public Facilities Authority, RB(c)
Series A, 5.00%, 06/01/29

    710       790,003  
Security  

Par

(000)

    Value  
Louisiana (continued)            

Louisiana Public Facilities Authority, RB(c) (continued)

   

Series A, 5.00%, 04/01/30

  $         525     $ 591,675  

Series A, 5.00%, 06/01/31

    500       567,770  

Louisiana Public Facilities Authority, Refunding RB

   

5.00%, 05/15/29

    1,235       1,484,569  

5.00%, 05/15/30

    990       1,188,841  

3.00%, 05/15/31

    2,225       2,419,265  

5.00%, 05/15/32

    1,485       1,779,683  

5.00%, 05/15/33

     2,175       2,603,932  

Louisiana Stadium & Exposition District, RB,
4.00%, 07/03/23

    1,000       1,056,740  

Louisiana Stadium & Exposition District, Refunding RB, Series A, 5.00%, 07/01/30

    3,000       3,261,210  

Parish of St. John the Baptist Louisiana,
Refunding RB

   

2.00%, 06/01/37(a)

    2,250       2,292,300  

2.10%, 06/01/37(a)

    1,305       1,347,726  

Sub-Series B-1, 2.13%, 06/01/37(a)

    1,800       1,860,228  

Sub-Series B-1, 2.38%, 06/01/37(a)

    3,260       3,441,615  

Port New Orleans Board of Commissioners, Refunding RB, Series B, AMT, 5.00%, 04/01/23(e)

    2,875       3,100,486  

State of Louisiana, GO, Series A,
4.00%, 05/15/23(e)

    6,540       6,997,015  

Terrebonne Levee & Conservation District, RB, 5.00%, 07/01/23(e)

    1,925       2,105,911  

Tobacco Settlement Financing Corp.,
Refunding RB

   

Series A, 5.25%, 05/15/32

    4,375       4,532,500  

Series A, 5.25%, 05/15/33

    4,750       4,920,335  

Series A, 5.25%, 05/15/35

    1,500       1,618,380  
   

 

 

 
          54,399,932  
Maine — 0.2%            

City of Portland Maine General Airport Revenue, Refunding RB

   

5.00%, 01/01/33

    695       874,678  

5.00%, 01/01/34

    305       382,970  

4.00%, 01/01/35

    1,000       1,167,740  

Maine Turnpike Authority, RB

   

5.00%, 07/01/29

    300       395,883  

5.00%, 07/01/30

    275       370,571  
   

 

 

 
      3,191,842  
Maryland — 1.8%            

Anne Arundel County Consolidated Special Taxing District, ST

   

4.20%, 07/01/24

    430       442,393  

4.90%, 07/01/30

    1,315       1,374,412  

City of Baltimore Maryland, Refunding RB,
5.00%, 09/01/31

    1,250       1,364,812  

County of Prince George’s Maryland, TA,
5.00%, 07/01/30(c)

    585       667,426  

Howard County Housing Commission, RB, M/F Housing, 5.00%, 12/01/33

    1,765       2,135,809  

Maryland Economic Development Corp., RB, Series D, AMT, 5.00%, 03/31/30

    1,325       1,599,209  

Maryland Health & Higher Educational Facilities Authority, Refunding RB

   

5.00%, 07/01/29

    2,200       2,561,130  

5.00%, 07/01/31

    2,400       2,874,696  

5.00%, 07/01/32

    500       622,715  

5.00%, 07/01/33

    2,585       3,105,005  

5.00%, 07/01/34

    775       963,449  
 

 

 

C H E D U L E    O F    N V E S T  M E N T S

  23


Schedule of Investments  (continued)

July 31, 2021

  

BlackRock Municipal 2030 Target Term Trust (BTT)

(Percentages shown are based on Net Assets)

 

Security   Par
(000)
    Value  

Maryland (continued)

   

Maryland Health & Higher Educational Facilities

   

Authority, Refunding RB (continued)

   

Series A, 5.00%, 01/01/31

  $  2,865     $ 3,396,515  

Series A, 5.00%, 01/01/32

    3,010       3,562,756  

Series A, 5.00%, 01/01/33

    3,165       3,746,221  

State of Maryland, GO, 1st Series,
3.00%, 03/15/34

    5,000       5,691,000  
   

 

 

 
          34,107,548  
Massachusetts — 1.4%            

Commonwealth of Massachusetts, GO, Series I, 5.00%, 12/01/33

    5,000       6,164,050  

Commonwealth of Massachusetts, Refunding GO, Series A, (AMBAC), 5.50%, 08/01/30

    2,500       3,468,000  

Massachusetts Bay Transportation Authority, Refunding RB, CAB, Series A,
0.00%, 07/01/32(b)

    5,500       4,402,145  

Massachusetts Development Finance Agency, RB, Series A, 5.00%, 01/01/33

    1,070       1,300,264  

Massachusetts Development Finance Agency, Refunding RB

   

Series A, 5.00%, 01/01/32

    2,020       2,511,102  

Series A, 5.00%, 01/01/33

    1,500       1,856,460  

Series A, 5.00%, 01/01/34

    2,085       2,570,680  

Series A, 5.00%, 01/01/35

    2,000       2,450,640  

Massachusetts Educational Financing Authority, Refunding RB, Series K, AMT, 5.25%, 07/01/29

    2,980       3,081,052  
   

 

 

 
      27,804,393  
Michigan — 1.6%            

City of Detroit Michigan, GO

   

5.00%, 04/01/26

    735       860,046  

5.00%, 04/01/27

    580       696,621  

5.00%, 04/01/28

    665       817,764  

5.00%, 04/01/29

    665       814,452  

5.00%, 04/01/30

    510       622,307  

5.00%, 04/01/31

    735       893,914  

5.00%, 04/01/32

    625       757,700  

5.00%, 04/01/33

    830       1,003,180  

Michigan Finance Authority, Refunding RB

   

5.00%, 06/01/24(e)

    2,750       3,126,117  

5.00%, 08/15/30

    2,105       2,306,680  

Michigan State Hospital Finance Authority, Refunding RB, Series C, 4.00%, 06/01/22(e)

    8,195       8,461,419  

Michigan State Housing Development Authority, RB, M/F Housing, Series A, 0.55%, 04/01/25

    985       986,743  

Michigan Strategic Fund, RB, AMT,
5.00%, 12/31/32

    2,000       2,490,840  

Michigan Strategic Fund, Refunding RB

   

5.00%, 11/15/29

    1,260       1,507,439  

5.00%, 11/15/34

    1,410       1,664,576  

Saginaw Valley State University, Refunding RB

   

Series A, 5.00%, 07/01/31

    2,070       2,502,609  

Series A, 5.00%, 07/01/32

    1,430       1,727,011  
   

 

 

 
      31,239,418  
Minnesota — 0.4%            

City of Spring Lake Park Minnesota, RB,
4.00%, 06/15/29

    1,185       1,308,489  

Sartell-St Stephen Independent School District No.748, GO, CAB(b)
Series B, (SD CRED PROG), 0.00%, 02/01/30

    3,915       3,269,730  
Security   Par
(000)
    Value  

 

Minnesota (continued)

           

Sartell-St Stephen Independent School District No.748, GO, CAB(b) (continued)

   

Series B, (SD CRED PROG), 0.00%, 02/01/31

  $ 2,190     $ 1,764,789  

Series B, (SD CRED PROG), 0.00%, 02/01/32

    1,450       1,126,389  
   

 

 

 
      7,469,397  
Mississippi — 1.2%            

Mississippi Development Bank, Refunding RB

   

Series A, (AGM), 5.00%, 03/01/30

    2,280       2,716,301  

Series A, (AGM), 5.00%, 03/01/31

    1,595       1,897,954  

Series A, (AGM), 5.00%, 03/01/32

    2,000       2,376,980  

Series A, (AGM), 5.00%, 03/01/33

    1,275       1,513,578  

State of Mississippi, RB, Series E,
5.00%, 10/15/33

     12,225       14,346,527  
   

 

 

 
          22,851,340  
Missouri — 0.6%            

Health & Educational Facilities Authority of the State of Missouri, Refunding RB

   

5.00%, 05/01/30

    3,000       3,245,400  

5.00%, 05/15/31

    1,175       1,416,874  

4.00%, 05/15/32

    1,680       1,944,919  

4.00%, 05/15/33

    2,000       2,313,080  

Series A, 4.00%, 11/15/33

    2,010       2,176,348  

Industrial Development Authority of the City of St. Louis Missouri, Refunding RB, Series A,
3.88%, 11/15/29

    970       986,296  
   

 

 

 
      12,082,917  
Montana — 0.5%            

City of Forsyth Montana, Refunding RB, Series A, 3.90%, 03/01/31(a)

    10,050       10,608,378  
   

 

 

 
Nebraska — 0.6%            

Central Plains Energy Project, RB

   

5.00%, 09/01/27

    5,000       5,249,150  

5.00%, 09/01/32

    4,500       4,724,235  

Elkhorn School District, GO

   

4.00%, 12/15/32

    325       401,112  

4.00%, 12/15/33

    375       461,261  
   

 

 

 
      10,835,758  
Nevada(c) — 0.0%            

State of Nevada Department of Business & Industry, RB

   

Series A, 5.00%, 07/15/27

    335       377,890  

Series A, 4.50%, 12/15/29

    590       657,284  
   

 

 

 
      1,035,174  
New Hampshire — 0.8%            

New Hampshire Business Finance Authority Refunding RB, 0.40%, 10/01/33(a)

    7,180       7,191,983  

New Hampshire Business Finance Authority, Refunding RB

   

4.00%, 01/01/28

    285       327,166  

4.00%, 01/01/29

    300       343,992  

4.00%, 01/01/30

    280       320,032  

Series A, AMT, 4.00%, 11/01/27(c)

    2,205       2,306,254  

New Hampshire State Turnpike System, RB, Series C, 4.00%, 08/01/33

    4,350       4,513,777  
   

 

 

 
      15,003,204  
 

 

 

24  

2 0 2 1    B L A C K O  C K    N N U A L    E P O R T    T O    H A  R E H O L D E R S


Schedule of Investments  (continued)

July 31, 2021

  

BlackRock Municipal 2030 Target Term Trust (BTT)

(Percentages shown are based on Net Assets)

 

Security   Par
(000)
    Value  
New Jersey — 14.5%            

Atlantic City Board of Education, Refunding GO

   

(AGM), 4.00%, 04/01/30

  $ 170     $ 200,535  

(AGM), 4.00%, 04/01/31

    175       204,223  

Casino Reinvestment Development Authority, Inc., Refunding RB

   

5.00%, 11/01/21

    2,465       2,488,541  

5.00%, 11/01/22

    1,890       1,981,438  

Industrial Pollution Control Financing Authority of Gloucester County, Refunding RB, Series A, AMT, 5.00%, 12/01/24

    1,015       1,095,236  

New Jersey Economic Development Authority, RB

   

5.00%, 06/15/30

    600       789,930  

Series A, 4.00%, 06/15/29(c)

    665       738,017  

Series A, 4.00%, 07/01/29

    350       402,139  

Series A, 5.00%, 06/15/32

     4,500       5,591,295  

Series C, 5.00%, 06/15/32

    3,600       4,481,748  

Series DDD, 5.00%, 06/15/35

    2,000       2,458,600  

AMT, 5.00%, 01/01/28

    4,705       5,201,142  

Series A, AMT, 5.63%, 11/15/30

    1,740       1,959,518  

Series B, AMT, 5.63%, 11/15/30

    1,315       1,480,900  

New Jersey Economic Development Authority, Refunding RB

   

5.00%, 06/15/26

    10,610       11,024,214  

4.25%, 06/15/27

    16,500       17,037,075  

(AGM), 5.00%, 06/01/28

    1,000       1,218,680  

5.00%, 01/01/29

    2,280       2,733,811  

(AGM), 5.00%, 06/01/30

    1,500       1,825,740  

(AGM), 5.00%, 06/01/31

    1,750       2,128,735  

(AGM), 4.00%, 06/01/32

    2,125       2,439,904  

Series BBB, 5.50%, 06/15/29

    10,000       12,452,700  

Series MMM, 4.00%, 06/15/35

    5,000       5,975,700  

Sub-Series A, 4.00%, 07/01/32

    9,855       11,142,162  

New Jersey Economic Development Authority, Refunding SAB, 5.75%, 04/01/31

    5,000       5,364,400  

New Jersey Educational Facilities Authority, RB, Series A, 4.00%, 09/01/30

    5,860       6,484,383  

New Jersey Health Care Facilities Financing Authority, Refunding RB

   

5.00%, 07/01/28

    1,500       1,795,395  

5.00%, 07/01/29

    4,150       5,015,356  

5.00%, 07/01/30

    3,500       4,225,377  

Series A, 5.00%, 07/01/30

    11,245       13,652,105  

New Jersey Higher Education Student Assistance Authority, RB

   

Series 1A, AMT, 5.00%, 12/01/25

    5,500       6,530,975  

Series 1A, AMT, 5.00%, 12/01/26

    2,250       2,668,252  

Series A, AMT, 4.00%, 12/01/32

    2,390       2,676,059  

Series A, AMT, 4.00%, 12/01/33

    1,915       2,118,699  

Series A, AMT, 4.00%, 12/01/34

    955       1,088,729  

Series A, AMT, 4.00%, 12/01/35

    955       1,062,275  

Series B, AMT, 5.00%, 12/01/23

    50       55,415  

New Jersey Higher Education Student Assistance Authority, Refunding RB, Series A, AMT, 5.00%, 12/01/23

    215       238,285  

New Jersey Housing & Mortgage Finance Agency, Refunding RB, Series A, AMT,
3.80%, 10/01/32

    11,595       12,609,447  

New Jersey Transportation Trust Fund Authority, RB

   

Series AA, 5.25%, 06/15/27

    4,225       4,984,697  

Series AA, 5.25%, 06/15/28

    4,500       5,303,880  

Series AA, 4.00%, 06/15/30

    10,815           11,181,088  
Security   Par
(000)
    Value  
New Jersey (continued)            

New Jersey Transportation Trust Fund Authority, RB (continued)

   

Series BB, 5.00%, 06/15/30

  $ 1,500     $ 1,911,225  

Series C, 5.25%, 06/15/32

     10,000       11,542,400  

Series D, 5.00%, 06/15/32

    5,000       5,729,600  

New Jersey Transportation Trust Fund Authority, Refunding RB

   

Series A, 5.00%, 06/15/30

    6,600       7,875,384  

Series A, 5.00%, 12/15/30

    21,325       27,080,831  

Newark Housing Authority Scholarship
Foundation A New Jersey Non,
Refunding RB, (NPFGC),
5.25%, 01/01/27

    5,000       5,884,150  

South Jersey Transportation Authority, Refunding RB, Series A, 5.00%, 11/01/33

    500       568,970  

Tobacco Settlement Financing Corp., Refunding RB

   

Series A, 5.00%, 06/01/30

    16,740       21,274,364  

Series A, 5.00%, 06/01/32

    8,270       10,418,794  

Township of Irvington New Jersey, Refunding GO

   

Series A, (AGM, SAW), 5.00%, 07/15/30

    2,000       2,259,960  

Series A, (AGM, SAW), 5.00%, 07/15/31

    1,450       1,637,456  
   

 

 

 
        280,289,934  
New Mexico — 1.4%            

City of Santa Fe New Mexico, RB, Series A, 5.00%, 05/15/34

    480       547,891  

New Mexico Educational Assistance Foundation, RB

   

Series A-1, AMT, (GTD STD LNS),
3.75%, 09/01/31

    6,250       6,638,063  

Series A-1, AMT, (GTD STD LNS),
3.88%, 04/01/34

    2,000       2,145,360  

Series A-2, AMT, (GTD STD LNS),
3.80%, 11/01/32

    5,850       6,219,720  

Series A-2, AMT, (GTD STD LNS),
3.80%, 09/01/33

    10,000       10,584,600  
   

 

 

 
      26,135,634  
New York — 4.7%            

Build NYC Resource Corp., Refunding RB, AMT, 4.50%, 01/01/25(c)

    645       697,051  

County of Nassau New York, GO

   

Series A, (AGM), 5.00%, 04/01/34

    4,165       5,220,494  

Series A, (AGM), 5.00%, 04/01/35

    4,385       5,485,240  

Hempstead Town Local Development Corp., Refunding RB

   

5.00%, 06/01/30

    200       264,600  

5.00%, 06/01/31

    300       404,367  

5.00%, 06/01/32

    100       134,132  

Metropolitan Transportation Authority, Refunding RB

   

2nd Sub Series, (AGM), 0.83%, 11/01/32(a)

    2,875       2,890,396  

Sub-Series C-1, 5.00%, 11/15/34

    10,000       12,442,300  

Metropolitan Transportation Authority, Refunding RB, CAB(b)

   

Series A, 0.00%, 11/15/30

    13,000       11,265,280  

Series C-2, 0.00%, 11/15/32

    19,315       15,639,162  

New York City Transitional Finance Authority Future Tax Secured Revenue, RB, Sub-Series B-1, 5.00%, 08/01/30

    4,980       6,289,342  

New York Transportation Development Corp., ARB

   

Series A, AMT, 4.00%, 07/01/32

    5,500       6,077,720  

Series A, AMT, 4.00%, 07/01/33

    6,000       6,626,220  

New York Transportation Development Corp., RB

   

AMT, 4.00%, 10/01/30

    8,140       9,816,759  
 

 

 

C H E D U L E    O F    N V E S T  M E N T S

  25


Schedule of Investments  (continued)

July 31, 2021

  

BlackRock Municipal 2030 Target Term Trust (BTT)

(Percentages shown are based on Net Assets)

 

Security   Par
(000)
    Value  

New York (continued)

   

New York Transportation Development Corp., RB (continued)

   

AMT, 4.00%, 10/31/34

  $ 350     $ 430,640  

New York Transportation Development Corp., Refunding RB

   

Series A, AMT, 5.00%, 12/01/29

    235       306,602  

Series A, Class A, AMT, 5.00%, 12/01/28

    350       447,325  

Series A, Class A, AMT, 5.00%, 12/01/30

    250       332,683  

Port Authority of New York & New Jersey, Refunding ARB, Series 223, AMT,
5.00%, 07/15/30

    3,730       4,960,825  
   

 

 

 
          89,731,138  
North Carolina — 0.1%            

North Carolina Medical Care Commission, RB

   

4.00%, 09/01/33

    175       207,935  

4.00%, 09/01/34

    185       219,042  

Series A, 4.00%, 10/01/27

    600       701,292  
   

 

 

 
      1,128,269  
Ohio — 1.3%            

Allen County Port Authority, Refunding RB,
Series A, 4.00%, 12/01/31

    460       536,664  

American Municipal Power, Inc., Refunding RB, Series A-2, 1.00%, 02/15/48(a)

    6,000       6,106,440  

County of Butler Ohio, Refunding RB

   

5.00%, 11/15/30

    1,225       1,531,789  

5.00%, 11/15/31

    2,500       3,121,650  

5.00%, 11/15/32

    2,200       2,738,296  

County of Franklin Ohio, RB

   

Series A, 5.25%, 07/01/28

    470       470,921  

Series A, 5.63%, 07/01/32

    940       942,011  

Ohio Air Quality Development Authority, Refunding RB, 3.25%, 09/01/29

    4,450       4,904,612  

State of Ohio, RB

   

AMT, (AGM), 5.00%, 12/31/29

    1,625       1,880,060  

AMT, (AGM), 5.00%, 12/31/30

    2,400       2,773,968  
   

 

 

 
      25,006,411  
Oklahoma — 0.9%            

Norman Regional Hospital Authority, Refunding RB

   

5.00%, 09/01/27

    2,100       2,509,227  

5.00%, 09/01/28

    2,000       2,388,040  

5.00%, 09/01/29

    2,150       2,565,230  

5.00%, 09/01/30

    5,130       6,116,550  

Oklahoma Capitol Improvement Authority, RB, Series B, 5.00%, 07/01/30

    2,150       2,893,728  
   

 

 

 
      16,472,775  
Oregon — 0.6%            

Oregon Health & Science University, Refunding RB, Series B, 5.00%, 07/01/35

    7,390       8,921,577  

Port of Morrow, Refunding GO

   

Series A, 4.00%, 06/01/30

    1,205       1,437,119  

Series D, 4.00%, 12/01/30

    880       1,057,417  
   

 

 

 
      11,416,113  
Pennsylvania — 17.4%            

Allegheny County Hospital Development Authority, Refunding RB

   

Series A, 5.00%, 04/01/31

    3,075       3,887,138  

Series A, 5.00%, 04/01/34

    3,345       4,194,362  
Security   Par
(000)
    Value  
Pennsylvania (continued)            

Allegheny County Hospital Development Authority, Refunding RB (continued)

   

Series A, 5.00%, 04/01/35

  $ 1,000     $ 1,250,980  

Allentown Neighborhood Improvement Zone Development Authority, RB(c)

   

5.00%, 05/01/23

    335       352,289  

5.00%, 05/01/28

    835       1,025,756  

Allentown Neighborhood Improvement Zone Development Authority, Refunding RB

   

Series A, 5.00%, 05/01/27

    6,750       6,997,320  

Series A, 5.00%, 05/01/28

    5,000       5,179,400  

Series A, 5.00%, 05/01/29

    3,745       3,878,022  

Series A, 5.00%, 05/01/30

    5,300       5,488,309  

Bucks County Industrial Development Authority, RB

   

5.00%, 07/01/29

    555       683,716  

5.00%, 07/01/30

    700       877,268  

Chester County Health and Education Facilities Authority, Refunding RB

   

Series A, 5.00%, 12/01/30

    2,180       2,283,463  

Series A, 5.00%, 10/01/32

    1,450       1,820,954  

Series A, 5.00%, 10/01/33

    2,300       2,884,867  

Chester County Industrial Development Authority, SAB, 4.38%, 03/01/28(c)

    265       300,279  

City of Philadelphia Pennsylvania Airport Revenue, Refunding RB, Series A, 5.00%, 07/01/30

    5,000       6,693,650  

City of Philadelphia Pennsylvania, Refunding GO

   

(AGM), 5.00%, 08/01/30

    9,235           11,451,215  

(AGM), 4.00%, 08/01/32

    6,000       7,020,300  

Series A, 5.00%, 08/01/30

    4,500       5,634,090  

Clarion County Industrial Development Authority, Refunding RB, AMT, 2.45%, 12/01/39(a)

    4,200       4,637,094  

Commonwealth Financing Authority, RB,
5.00%, 06/01/32

    6,000       7,569,780  

Commonwealth of Pennsylvania, Refunding GO,
1st Series, 4.00%, 01/01/30

    7,000       8,278,340  

Cumberland County Municipal Authority, Refunding RB

   

5.00%, 01/01/25(e)

    645       749,361  

5.00%, 01/01/29

    1,080       1,226,513  

5.00%, 01/01/30

    2,250       2,553,615  

5.00%, 01/01/32

    1,510       1,763,182  

Dauphin County General Authority, Refunding RB, Series A, 4.00%, 06/01/31

    2,275       2,572,183  

Delaware County Authority, Refunding RB

   

5.00%, 07/01/28

    800       961,712  

5.00%, 07/01/29

    1,365       1,639,679  

5.00%, 07/01/30

    1,435       1,722,301  

East Hempfield Township Industrial Development Authority, RB(e)

   

5.00%, 07/01/23

    1,280       1,399,347  

5.00%, 07/01/25

    825       976,033  

Geisinger Authority, Refunding RB

   

Series A-2, 5.00%, 02/15/32

    4,000       4,936,320  

Series A-2, 5.00%, 02/15/34

    1,750       2,155,405  

Lancaster County Hospital Authority, Refunding RB, Series A, 3.00%, 08/15/30

    2,535       2,809,262  

Latrobe Industrial Development Authority, Refunding RB, 5.00%, 03/01/30

    150       185,222  
 

 

 

26  

2 0 2 1    B L A C K O  C K    N N U A L    E P O R T    T O    H A  R E H O L D E R S


Schedule of Investments  (continued)

July 31, 2021

  

BlackRock Municipal 2030 Target Term Trust (BTT)

(Percentages shown are based on Net Assets)

 

Security  

Par

(000)

    Value  

Pennsylvania (continued)

   

Montgomery County Higher Education and Health Authority, Refunding RB

   

4.00%, 09/01/34

  $ 3,000     $ 3,567,960  

4.00%, 09/01/35

    1,735       2,056,010  

4.00%, 09/01/36

    1,500       1,770,585  

Series A, 5.00%, 09/01/31

    1,750       2,200,817  

Series A, 5.00%, 09/01/32

    1,315       1,646,932  

Montgomery County Industrial Development Authority, Refunding RB

   

5.00%, 05/15/22(e)

    2,500       2,595,675  

5.00%, 01/01/30

    2,000       2,122,600  

Series A, 5.25%, 01/15/29

    3,250       3,759,340  

Northampton County General Purpose Authority, RB, Series A, 5.00%, 08/15/33

    12,660       13,842,191  

Northampton County General Purpose Authority, Refunding RB, 5.00%, 11/01/34

    5,400       6,725,646  

Pennsylvania Economic Development Financing Authority, RB

   

Series A-1, 5.00%, 04/15/30

    2,500       3,323,300  

AMT, 5.00%, 12/31/29

    5,000       5,976,550  

AMT, 5.00%, 12/31/30

     13,100           15,631,575  

AMT, 5.00%, 12/31/34

    16,500       19,568,010  

Pennsylvania Economic Development Financing Authority, Refunding RB, 5.00%, 03/15/31

    4,500       5,474,250  

Pennsylvania Higher Educational Facilities Authority, RB, Series AT-1, 5.00%, 06/15/30

    7,910       9,530,601  

Pennsylvania Higher Educational Facilities Authority, Refunding RB

   

5.00%, 05/01/30

    425       511,551  

5.00%, 05/01/31

    1,275       1,532,537  

4.00%, 05/01/32

    3,000       3,047,130  

5.00%, 05/01/32

    1,750       2,100,525  

5.00%, 05/01/33

    3,320       3,979,750  

5.00%, 05/01/35

    1,000       1,196,260  

Pennsylvania Housing Finance Agency, Refunding RB, Series 125A, AMT,
3.40%, 10/01/32

    9,000       9,695,070  

Pennsylvania Turnpike Commission, RB

   

Series B, 5.00%, 12/01/29

    800       1,064,328  

Series B, 5.00%, 12/01/30

    620       841,600  

Sub-Series B-1, 5.00%, 06/01/31

    3,000       3,739,620  

Sub-Series B-1, 5.00%, 06/01/32

    4,075       5,074,597  

Sub-Series B-1, 5.00%, 06/01/33

    4,000       4,976,160  

Pennsylvania Turnpike Commission, Refunding RB

   

2nd Series, 5.00%, 12/01/32

    1,000       1,257,760  

2nd Series, 5.00%, 12/01/35

    2,005       2,500,055  

2nd Sub Series, 5.00%, 12/01/33

    1,815       2,275,502  

2nd Sub Series, 5.00%, 12/01/34

    1,500       1,875,615  

Sub-Series B-2, (AGM), 5.00%, 06/01/34

    4,000       4,969,280  

Philadelphia Authority for Industrial Development, RB, 4.00%, 06/15/29

    350       379,782  

Philadelphia Gas Works Co., RB, Series A, (AGM), 5.00%, 08/01/30

    800       1,063,816  

Philadelphia Gas Works Co., Refunding RB, Series 14-T, 5.00%, 10/01/30

    425       514,301  

Pittsburgh Water & Sewer Authority, RB,
Series B, (AGM), 5.00%, 09/01/30

    205       274,206  

Southeastern Pennsylvania Transportation Authority, RB, 5.00%, 06/01/30

    5,000       6,650,300  
Security  

Par

(000)

    Value  
Pennsylvania (continued)            

State Public School Building Authority, RB, (SAW), 5.00%, 04/01/22(e)

  $  23,630     $ 24,393,485  

Wayne County Hospital & Health Facilities Authority, RB

   

Series A, (CNTY GTD), 5.00%, 07/01/31

    460       573,813  

Series A, (CNTY GTD), 4.00%, 07/01/33

    440       507,223  

West Cornwall Township Municipal Authority, Refunding RB

   

Series A, 4.00%, 11/15/27

    130       149,566  

Series A, 4.00%, 11/15/28

    105       122,464  

Series A, 4.00%, 11/15/29

    140       164,129  

Series A, 4.00%, 11/15/30

    190       224,073  

Series A, 4.00%, 11/15/31

    200       235,088  

Westmoreland County Municipal Authority, Refunding RB

   

(BAM), 5.00%, 08/15/27

    1,500       1,775,355  

(BAM), 5.00%, 08/15/31

    5,000       6,268,250  

(BAM), 5.00%, 08/15/32

    17,945       22,474,139  
   

 

 

 
        334,238,099  
Puerto Rico(b) — 4.4%            

Puerto Rico Sales Tax Financing Corp. Sales Tax Revenue, RB, CAB

   

Series A-1, Restructured, 0.00%, 07/01/29

    14,055       12,369,384  

Series A-1, Restructured, 0.00%, 07/01/31

    38,523       31,069,185  

Series A-1, Restructured, 0.00%, 07/01/33

    43,149       32,316,012  

Series B-1, Restructured, 0.00%, 07/01/31

    5,755       4,657,291  

Series B-1, Restructured, 0.00%, 07/01/33

    6,477       4,819,859  
   

 

 

 
      85,231,731  
Rhode Island — 1.2%            

Rhode Island Health and Educational Building Corp., Refunding RB, 5.00%, 05/15/30

    1,500       1,793,415  

Rhode Island Housing and Mortgage Finance Corp., RB, S/F Housing, Series 68-B,
3.00%, 10/01/31

    8,365       8,872,003  

Tobacco Settlement Financing Corp., Refunding RB

   

Series A, 5.00%, 06/01/28

    2,750       3,174,022  

Series A, 5.00%, 06/01/29

    4,500       5,189,760  

Series A, 5.00%, 06/01/30

    4,215       4,857,408  
   

 

 

 
      23,886,608  
South Carolina — 0.8%            

South Carolina Jobs-Economic Development Authority, Refunding RB, Series A,
5.00%, 05/01/35

    10,000       12,423,600  

South Carolina Public Service Authority, Refunding RB, Series A, 5.00%, 12/01/31

    2,800       3,722,376  
   

 

 

 
      16,145,976  
Tennessee — 0.6%            

Chattanooga Health Educational & Housing Facility Board, Refunding RB, Series A,
4.00%, 08/01/36

    2,000       2,368,000  

Chattanooga-Hamilton County Hospital Authority, Refunding RB, Series A, 5.00%, 10/01/31

    6,210       7,015,561  

Memphis-Shelby County Industrial Development Board, Refunding TA, Series A, 4.75%, 07/01/27

    480       475,335  

Metropolitan Government Nashville & Davidson County Health & Educational Facilities Board, RB, Series A, 5.00%, 07/01/31

    1,300       1,565,928  
   

 

 

 
      11,424,824  
 

 

 

C H E D U L E    O F    N V E S T  M E N T S

  27


Schedule of Investments  (continued)

July 31, 2021

  

BlackRock Municipal 2030 Target Term Trust (BTT)

(Percentages shown are based on Net Assets)

 

Security  

Par

(000)

    Value  

Texas — 12.3%

   

Arlington Higher Education Finance Corp., RB, 4.00%, 06/15/31

  $ 3,260     $ 3,427,042  

Central Texas Regional Mobility Authority, RB

   

Series A, Senior Lien, 5.00%, 01/01/30

    1,600       1,870,144  

Series A, Senior Lien, 5.00%, 01/01/31

    1,175       1,372,612  

Series A, Senior Lien, 5.00%, 01/01/33

    1,500       1,750,305  

Central Texas Turnpike System, RB

   

Series C, 5.00%, 08/15/32

     12,500           14,157,625  

Series C, 5.00%, 08/15/33

    14,000       15,849,120  

City of Austin Texas Water & Wastewater System Revenue, Refunding RB,
Series C, 5.00%, 11/15/30

    900       1,230,354  

City of Houston Texas Airport System Revenue, Refunding RB

   

Sub-Series D, 5.00%, 07/01/33

    7,000       8,882,790  

Sub-Series A, AMT, 5.00%, 07/01/30

    1,200       1,580,412  

City of Houston Texas Combined Utility System Revenue, Refunding RB

   

Series B, 1st Lien, 5.25%, 11/15/33

    4,000       4,963,320  

Series B, 1st Lien, 5.00%, 11/15/34

    7,315       8,965,483  

Clifton Higher Education Finance Corp., RB,
6.00%, 08/15/33

    1,650       1,835,014  

Clifton Higher Education Finance Corp.,
Refunding RB

   

Series A, 3.10%, 12/01/22

    325       331,916  

Series A, (PSF), 4.00%, 08/15/31

    1,250       1,460,962  

Series A, 3.95%, 12/01/32

    1,800       1,875,708  

Series A, (PSF), 4.00%, 08/15/33

    1,200       1,399,872  

County of Harris Texas, Refunding RB, Series C, Senior Lien, 4.00%, 08/15/33

    12,325       12,784,846  

County of Nueces Texas, Refunding GO

   

4.00%, 02/15/33

    1,165       1,414,496  

4.00%, 02/15/35

    725       876,018  

Dallas Fort Worth International Airport,
Refunding RB,

   

5.00%, 11/01/32

    5,000       6,766,500  

Harris County Cultural Education Facilities Finance
Corp., RB

   

Series B, 5.75%, 01/01/28

    500       531,440  

Series B, 6.38%, 01/01/33

    460       492,421  

Harris County Cultural Education Facilities Finance
Corp., Refunding RB

   

Series A, 5.00%, 06/01/28

    1,150       1,217,402  

Series A, 5.00%, 01/01/33

    1,090       1,145,852  

Series A, 5.00%, 06/01/33

    3,000       3,179,820  

Leander Independent School District, Refunding GO, CAB(b)

   

Series D, (PSF), 0.00%, 08/15/31

    1,200       846,960  

Series D, (PSF), 0.00%, 08/15/32

    2,000       1,378,360  

Series D, (PSF), 0.00%, 08/15/33

    4,485       2,939,604  

Matagorda County Navigation District No.1, Refunding RB

   

Series A, (AMBAC), 4.40%, 05/01/30

    26,120       32,724,703  

Series B-2, 4.00%, 06/01/30

    12,995       13,797,701  

Series B, AMT, (AMBAC), 4.55%, 05/01/30

    10,000       12,652,000  

Midland County Fresh Water Supply District No.1, RB, CAB(b)

   

Series A, 0.00%, 09/15/31

    6,235       4,718,586  

Series A, 0.00%, 09/15/32

    15,135       10,879,492  
Security  

Par

(000)

    Value  

Texas (continued)

   

Mission Economic Development Corp., Refunding RB, AMT, Senior Lien, 4.63%, 10/01/31(c)

  $ 3,805     $ 4,014,389  

New Hope Cultural Education Facilities Finance
Corp., RB(c)

   

Series A, 3.63%, 08/15/22

    100       100,171  

Series A, 4.25%, 08/15/27

    450       450,783  

Series A, 4.00%, 08/15/29

    335       384,825  

Red River Health Facilities Development Corp., RB

   

4.70%, 01/01/22

    140       141,877  

5.50%, 01/01/32

    1,000       1,014,490  

Socorro Independent School District, Refunding GO, Series B, (PSF), 4.00%, 08/15/34

    3,000       3,542,700  

Tarrant County Cultural Education Facilities Finance
Corp., RB

   

Series A, 4.00%, 05/15/23(e)

     20,920           22,379,379  

Series B, 5.00%, 07/01/35

    6,000       7,548,600  

Tarrant County Cultural Education Facilities Finance
Corp., Refunding RB, Series A-1,
5.00%, 10/01/29

    1,000       1,126,520  

Texas Municipal Gas Acquisition & Supply Corp. III,
Refunding RB, 5.00%, 12/15/30

    10,935       14,595,491  

Texas Public Finance Authority, Refunding RB, 4.00%, 12/01/31

    1,650       1,909,743  

Texas Transportation Commission State Highway
Fund, Refunding RB, 5.00%, 10/01/22

    1,000       1,057,740  
   

 

 

 
      237,565,588  
Utah — 0.3%  

Utah Transit Authority, Refunding RB, Subordinate,
4.00%, 12/15/31

    5,000       5,817,400  
   

 

 

 
Virginia — 0.6%  

Dulles Town Center Community Development
Authority, Refunding SAB, 4.25%, 03/01/26

    500       505,130  

Fairfax County Economic Development Authority, RB, Series A, 5.00%, 12/01/23(e)

    2,000       2,226,640  

Hanover County Economic Development Authority,
Refunding RB

   

Series A, 4.50%, 07/01/30

    3,000       3,067,470  

Series A, 4.50%, 07/01/32

    1,100       1,124,013  

Virginia Small Business Financing Authority, RB, AMT, Senior Lien, 5.00%, 07/01/34

    3,940       4,015,372  
   

 

 

 
      10,938,625  
Washington — 2.1%  

Greater Wenatchee Regional Events Center Public
Facilities District, Refunding RB

   

Series A, 5.00%, 09/01/27

    1,000       1,031,590  

Series A, 5.25%, 09/01/32

    655       674,965  

Port of Seattle Washington, ARB

   

Series C, AMT, Intermediate Lien,
5.00%, 05/01/33

    6,695       8,197,157  

Series C, AMT, Intermediate Lien,
5.00%, 05/01/34

    6,000       7,340,520  

Washington Health Care Facilities Authority,
Refunding RB, Series B, 5.00%, 08/15/35

    9,485       11,885,748  

Washington State Convention Center Public Facilities District, RB,
4.00%, 07/01/31

    4,990       5,959,008  

Washington State Housing Finance Commission, Refunding RB

   

5.00%, 07/01/28

    1,000       1,076,380  

5.00%, 07/01/33

    1,100       1,182,236  
 

 

 

28  

2 0 2 1    B L A C K O  C K    N N U A L    E P O R T    T O    H A  R E H O L D E R S


Schedule of Investments  (continued)

July 31, 2021

  

BlackRock Municipal 2030 Target Term Trust (BTT)

(Percentages shown are based on Net Assets)

 

Security  

Par

(000)

    Value  

Washington (continued)

 

WBRP 3.2, RB

   

Series A, 5.00%, 01/01/31

  $         1,000     $ 1,177,400  

Series A, 5.00%, 01/01/32

    1,140       1,341,233  
   

 

 

 
      39,866,237  
West Virginia — 0.2%            

West Virginia Hospital Finance Authority, RB

   

Series A, 5.00%, 06/01/31

    1,950       2,412,423  

Series A, 5.00%, 06/01/33

    1,100       1,358,500  
   

 

 

 
      3,770,923  
Wisconsin — 1.9%            

Public Finance Authority, RB(c)

   

4.00%, 06/15/30

    1,520       1,657,423  

5.00%, 01/01/31

    650       738,452  

Series A, 4.00%, 07/15/29

    645       719,569  

Series A, 4.00%, 03/01/30

    1,305       1,413,433  

Series A, 3.75%, 06/01/30

    345       375,001  

Public Finance Authority, Refunding RB

   

3.00%, 12/01/26

    250       271,270  

4.00%, 09/01/29(c)

    400       415,216  

AMT, 2.63%, 11/01/25

    3,000       3,261,390  

Series B, AMT, 5.25%, 07/01/28

    2,250       2,350,080  

Wisconsin Health & Educational Facilities
Authority, Refunding RB

   

4.00%, 10/01/32

    4,520       4,711,286  

5.00%, 04/01/35

    2,500       3,209,425  

Series C-4, 0.67%, 08/15/54(a)

    8,200       8,364,910  

Wisconsin Housing & Economic
Development Authority, RB, S/F Housing, Series D, (FNMA), 3.00%, 09/01/32

    9,000       9,429,480  
   

 

 

 
      36,916,935  
   

 

 

 

Total Municipal Bonds — 126.0%
(Cost: $2,202,545,609)

      2,427,084,919  
   

 

 

 

Municipal Bonds Transferred to Tender Option Bond Trusts(h)

 

Colorado — 4.3%

   

City & County of Denver Colorado Airport
System Revenue, Refunding ARB

   

Series A, AMT, 4.25%, 11/15/29(e)(i)

    33,820       35,523,869  

Series A, AMT, 4.25%, 11/15/30(e)

    35,210       36,983,898  

Series A, AMT, 4.25%, 11/15/31

    8,085       8,492,327  

Series A, AMT, 4.25%, 11/15/32

    2,230       2,342,349  
   

 

 

 
      83,342,443  
Florida — 5.1%            

County of Broward Florida Airport System
Revenue, ARB

   

Series Q-1, 4.00%, 10/01/29(i)

    17,200       17,968,717  

Series Q-1, 4.00%, 10/01/30

    18,095       18,903,718  

Series Q-1, 4.00%, 10/01/31

    18,820       19,661,120  

Series Q-1, 4.00%, 10/01/32

    19,575       20,449,863  

Series Q-1, 4.00%, 10/01/33

    20,355       21,264,723  
   

 

 

 
      98,248,141  
Iowa — 2.3%            

State of Iowa Board of Regents, RB

   

4.00%, 09/01/28

    3,375       3,515,221  

4.00%, 09/01/29

    6,525       6,796,094  

4.00%, 09/01/30

    6,325       6,587,785  
Security  

Par

(000)

    Value  
Iowa (continued)            

State of Iowa Board of Regents,
RB (continued)

   

4.00%, 09/01/31

  $         8,650     $ 9,009,382  

4.00%, 09/01/32

    7,750       8,071,989  

4.00%, 09/01/33

    9,375       9,764,503  
   

 

 

 
      43,744,974  
Nevada — 1.1%            

County of Clark Nevada, Refunding GO,
Series B, 4.00%, 11/01/34

    17,710       20,595,134  
   

 

 

 
New Jersey — 2.0%            

State of New Jersey, GO, Series A,
4.00%, 06/01/30

    30,000       37,578,300  
   

 

 

 
Pennsylvania — 2.5%            

Commonwealth of Pennsylvania, GO,
1st Series, 5.00%, 03/01/32(i)

    20,000       25,430,000  

County of Lehigh Pennsylvania, Refunding
RB, 4.00%, 07/01/33

    22,285       23,065,640  
   

 

 

 
      48,495,640  
Texas — 4.3%            

San Antonio Public Facilities Corp., Refunding RB

   

4.00%, 09/15/30

    15,000       15,631,205  

4.00%, 09/15/31

    19,475       20,294,514  

4.00%, 09/15/32

    18,075       18,835,602  

4.00%, 09/15/33(i)

    11,000       11,462,883  

4.00%, 09/15/34

    11,885       12,385,125  

4.00%, 09/15/35

    4,500       4,689,361  
   

 

 

 
      83,298,690  
   

 

 

 

Total Municipal Bonds Transferred to Tender Option Bond Trusts — 21.6%
(Cost: $394,681,401)

      415,303,322  
   

 

 

 

Total Long-Term Investments — 147.6%
(Cost: $2,597,227,010)

      2,842,388,241  
   

 

 

 
     Shares         
Short-Term Securities  

Money Market Funds — 2.6%

   

BlackRock Liquidity Funds, MuniCash,
Institutional Class, 0.01%(j)(k)

    50,941,762       50,951,950  
   

 

 

 

Total Short-Term Securities — 2.6%
(Cost: $50,943,523)

      50,951,950  
   

 

 

 

Total Investments — 150.2%
(Cost: $2,648,170,533)

      2,893,340,191  

Other Assets Less Liabilities — 0.8%

      15,671,410  

Liability for TOB Trust Certificates, Including Interest Expense and Fees Payable — (12.1)%

      (233,278,065

RVMTP Shares at Liquidation Value, Net of Deferred Offering Costs — (38.9)%

      (749,705,274
   

 

 

 

Net Assets Applicable to Common Shares — 100.0%

    $ 1,926,028,262  
   

 

 

 

 

(a) 

Variable rate security. Interest rate resets periodically. The rate shown is the effective interest rate as of period end. Security description also includes the reference rate and spread if published and available.

(b) 

Zero-coupon bond.

(c) 

Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registration to qualified institutional investors.

(d) 

Security is collateralized by municipal bonds or U.S. Treasury obligations.

 

 

 

C H E D U L E     O F    N V E S  T M E N T S

  29


Schedule of Investments  (continued)    BlackRock Municipal 2030 Target Term Trust (BTT)
July 31, 2021        

 

(e) 

U.S. Government securities held in escrow, are used to pay interest on this security as well as to retire the bond in full at the date indicated, typically at a premium to par.

(f) 

When-issued security.

(g) 

Step coupon security. Coupon rate will either increase (step-up bond) or decrease (step- down bond) at regular intervals until maturity. Interest rate shown reflects the rate currently in effect.

(h) 

Represent bonds transferred to a TOB Trust in exchange of cash and residual certificates received by the Trust. These bonds serve as collateral in a secured borrowing. See Note 4 of the Notes to Financial Statements for details.

(i) 

All or a portion of the security is subject to a recourse agreement. The aggregate maximum potential amount the Trust could ultimately be required to pay under the agreements, which expire between March 15, 2022 to March 1, 2026, is $171,383,061. See Note 4 of the Notes to Financial Statements for details.

(i) 

Affiliate of the Trust.

(i) 

Annualized 7-day yield as of period end.

 

 

Affiliates

Investments in issuers considered to be affiliate(s) of the Trust during the year ended July 31, 2021 for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:

 

                   
Affiliated Issuer    Value at
07/31/20
     Purchases
at Cost
     Proceeds
from Sales
     Net
Realized
Gain
(Loss)
     Change in
Unrealized
Appreciation
(Depreciation)
     Value at
07/31/21
     Shares
Held at
07/31/21
     Income      Capital Gain
Distributions
from
Underlying
Funds
 

BlackRock Liquidity Funds, MuniCash, Institutional Class

   $ 53,785,322      $      $ (2,837,499 )(a)     $ (935    $ 5,062      $ 50,951,950        50,941,762      $ 6,302      $  
           

 

 

    

 

 

    

 

 

       

 

 

    

 

 

 

 

  (a) 

Represents net amount purchased (sold).

 

Fair Value Hierarchy as of Period End

Various inputs are used in determining the fair value of financial instruments. For a description of the input levels and information about the Trust’s policy regarding valuation of financial instruments, refer to the Notes to Financial Statements.

The following table summarizes the Trust’s financial instruments categorized in the fair value hierarchy. The breakdown of the Trust’s financial instruments into major categories is disclosed in the Schedule of Investments above.

 

         
      Level 1        Level 2        Level 3        Total  

Assets

                 

Investments

                 

Long-Term Investments

                 

Municipal Bonds

   $        $ 2,427,084,919        $        $ 2,427,084,919  

Municipal Bonds Transferred to Tender Option Bond Trusts

              415,303,322                   415,303,322  

Short-Term Securities

                 

Money Market Funds

     50,951,950                            50,951,950  
  

 

 

      

 

 

      

 

 

      

 

 

 
   $ 50,951,950        $ 2,842,388,241        $        $ 2,893,340,191  
  

 

 

      

 

 

      

 

 

      

 

 

 

The Trust may hold assets and/or liabilities in which the fair value approximates the carrying amount for financial statement purposes. As of period end, such assets and/or liabilities are categorized within the fair value hierarchy as follows:

 

      Level 1        Level 2        Level 3        Total  

Liabilities

                 

TOB Trust Certificates

   $        $ (233,219,979      $        $ (233,219,979

RVMTP Shares at Liquidation Value

              (750,000,000                 (750,000,000
  

 

 

      

 

 

      

 

 

      

 

 

 
   $        $ (983,219,979      $        $ (983,219,979
  

 

 

      

 

 

      

 

 

      

 

 

 

See notes to financial statements.

 

 

30  

2 0 2 1    B L A C K O  C K    N N U A L    E P O R T    T O    H A  R E H O L D E R S


Schedule of Investments  

July 31, 2021

  

BlackRock New York Municipal Income Trust (BNY)

(Percentages shown are based on Net Assets)

 

Security   Par
(000)
    Value  

Municipal Bonds

   

New York — 122.4%

   
Corporate — 4.2%            

Build NYC Resource Corp., Refunding RB, AMT, 5.00%, 01/01/35(a)

  $ 420     $ 480,085  

New York Liberty Development Corp., Refunding RB, 5.25%, 10/01/35

    5,025       7,334,540  

New York State Environmental Facilities Corp., RB, AMT, 2.75%, 09/01/50(b)

    665       703,570  

New York Transportation Development Corp., RB

   

AMT, 5.00%, 10/01/35

    320       414,301  

AMT, 5.00%, 10/01/40

    875       1,118,740  

New York Transportation Development Corp., Refunding ARB

   

AMT, 2.25%, 08/01/26

    1,475       1,512,893  

AMT, 3.00%, 08/01/31

    1,180       1,276,736  

Niagara Area Development Corp., Refunding RB, Series A, AMT, 4.75%, 11/01/42(a)

    2,710       2,858,264  
   

 

 

 
      15,699,129  
County/City/Special District/School District — 31.5%            

City of New York NY, GO, Series F-1, 5.00%, 03/01/44

    2,000       2,615,180  

City of New York, GO

   

Series A, 5.00%, 08/01/43

    1,500       1,912,815  

Series A-1, 5.00%, 08/01/21(c)

    1,200       1,200,000  

Series C, 5.00%, 08/01/42

    385       500,677  

Series D, 5.38%, 06/01/32

    25       25,092  

Series D-1, 4.00%, 03/01/44

    620       735,463  

Sub-Series D-1, 5.00%, 08/01/31

    1,820       1,993,610  

Sub-Series F-1, 5.00%, 04/01/43

    930       1,158,668  

Sub-Series G-1, 5.00%, 04/01/22(c)

    5,620       5,801,976  

City of New York, Refunding GO

   

Series E, 5.00%, 02/01/23(c)

    2,500       2,683,075  

Series E, 5.50%, 08/01/25

    1,180       1,306,720  

City of Syracuse New York, GO, Series A, AMT, (AGM), 4.75%, 11/01/31

    500       504,320  

County of Nassau New York, GO

   

Series B, (AGM), 5.00%, 07/01/45

    1,000       1,247,420  

Series C, 5.00%, 10/01/29

    500       625,030  

County of Nassau New York, Refunding GO,
Series C, 5.00%, 10/01/31

    1,420       1,768,539  

Erie County Industrial Development Agency, Refunding RB, Series A, (SAW), 5.00%, 05/01/28

    565       673,553  

Haverstraw-Stony Point Central School District, GO, (AGM SAW), 5.00%, 10/15/36

    120       132,920  

Hudson Yards Infrastructure Corp., RB,
5.75%, 02/15/47

    895       899,028  

Metropolitan Transportation Authority, Refunding RB

   

Sub-Series B-1, 5.00%, 11/15/31

    1,500       1,660,320  

Sub-Series B-2, 4.00%, 11/15/34

    1,750       2,035,023  

New York City Industrial Development Agency, RB(d)

   

(AGC), 0.00%, 03/01/35

    500       373,740  

(AGC), 0.00%, 03/01/39

    1,000       661,090  

(AGC), 0.00%, 03/01/42

    3,710       2,259,205  

(AGC), 0.00%, 03/01/45

    2,000       1,111,240  

New York City Industrial Development Agency, Refunding RB

   

4.00%, 03/01/45

    6,000       6,902,820  

(AGM), 4.00%, 03/01/45    

    360       426,647  
Security   Par
(000)
    Value  
County/City/Special District/School District (continued)            

New York City Industrial Development Agency, Refunding RB (continued) Class A, (AGM),
3.00%, 01/01/46

  $ 4,750     $ 5,132,042  

New York City Transitional Finance Authority Future Tax Secured Revenue, RB

   

Series A-2, 5.00%, 08/01/38

    2,545       3,173,157  

Series D-1, 5.00%, 02/01/32

    5,000       5,591,000  

Series D-1, 5.00%, 11/01/38

    825       834,793  

Sub-Series A-3, 4.00%, 08/01/43

    1,035       1,208,093  

Sub-Series B-1, 5.00%, 11/01/35

    425       478,882  

Sub-Series B-1, 5.00%, 11/01/36

    340       382,894  

Sub-Series E-1, 5.00%, 02/01/39

    1,015       1,256,205  

Sub-Series E-1, 5.00%, 02/01/42

    2,500       2,558,875  

Sub-Series E-1, 5.00%, 02/01/43

    3,600       4,431,816  

Series C-3, Subordinate, 5.00%, 05/01/41

    2,445       3,062,045  

New York Convention Center Development Corp., RB, CAB(d)

   

Series A, Senior Lien, 0.00%, 11/15/47

    3,000       1,582,710  

Series B, Sub Lien, (AGM-CR), 0.00%, 11/15/55

    4,000       1,620,160  

New York Convention Center Development Corp., Refunding RB

   

5.00%, 11/15/40

    5,755       6,752,457  

5.00%, 11/15/45

    7,290       8,494,016  

New York Liberty Development Corp., Refunding RB

   

5.00%, 11/15/31

    2,860       2,899,268  

5.00%, 11/15/44

    10,155       10,286,710  

5.75%, 11/15/51

    2,555       2,592,303  

Class 1, 4.00%, 09/15/35

    3,035       3,107,415  

Class 2, 5.00%, 09/15/43

    2,420       2,484,832  

Class 3, 5.00%, 03/15/44

    2,760       2,834,078  

Series 1, Class 1, 5.00%, 11/15/44(a)

    4,545       5,022,043  

Series 2, Class 2, 5.38%, 11/15/40(a)

    680       768,216  

New York State Dormitory Authority, Refunding RB, Series A, 5.00%, 07/01/22(c)

    450       470,070  

Trust for Cultural Resources of The City of New York, Refunding RB, Series A, 5.00%, 08/01/23(c)

    410       450,114  
   

 

 

 
      118,688,365  

Education — 16.8%

   

Albany Capital Resource Corp., Refunding RB

   

Series A, 5.00%, 12/01/33

    175       199,414  

Series A, 4.00%, 12/01/34

    130       143,744  

Amherst Development Corp., Refunding RB

   

5.00%, 10/01/43

    535       609,344  

5.00%, 10/01/48

    410       459,376  

Buffalo & Erie County Industrial Land Development Corp., Refunding RB, Series A, 5.00%, 06/01/35

    345       389,902  

Build NYC Resource Corp., RB

   

5.00%, 02/01/33(a)

    420       455,990  

5.75%, 02/01/49(a)

    455       495,222  

Series A, 4.00%, 06/15/31

    350       400,974  

Series A, 5.13%, 05/01/38(a)

    660       757,225  

Series A, 5.50%, 05/01/48(a)

    270       308,040  

Build NYC Resource Corp., Refunding RB

   

5.00%, 06/01/33

    300       343,605  

5.00%, 06/01/35

    350       400,211  

5.00%, 06/01/40

    690       788,311  

5.00%, 08/01/47

    135       163,818  

5.00%, 11/01/47

    515       814,246  
 

 

 

C H E D U L E     O F    N V E S  T M E N T S

  31


Schedule of Investments  (continued)

July 31, 2021

  

BlackRock New York Municipal Income Trust (BNY)

(Percentages shown are based on Net Assets)

 

Security  

Par

(000)

    Value  

Education (continued)

 

Build NYC Resource Corp., Refunding RB (continued)

   

Series A, 5.00%, 06/01/38

  $         750     $         844,380  

County of Cattaraugus New York, RB

   

5.00%, 05/01/34

    170       189,982  

5.00%, 05/01/39

    125       139,194  

Dobbs Ferry Local Development Corp., RB

   

5.00%, 07/01/39

    1,000       1,125,120  

5.00%, 07/01/44

    500       560,880  

Dutchess County Local Development Corp., RB

   

5.00%, 07/01/43

    450       561,226  

5.00%, 07/01/48

    680       844,737  

Dutchess County Local Development Corp., Refunding RB

   

5.00%, 07/01/42

    755       934,720  

4.00%, 07/01/46

    1,430       1,668,324  

Geneva Development Corp., RB, 5.25%, 09/01/23(c)

    900       996,318  

Hempstead Town Local Development Corp., Refunding RB

   

5.00%, 10/01/34

    310       352,755  

5.00%, 10/01/35

    935       1,063,114  

4.00%, 07/01/37

    220       257,343  

5.00%, 07/01/47

    320       392,163  

Madison County Capital Resource Corp., Refunding RB, Series A, 4.50%, 07/01/23(c)

    1,500       1,626,300  

Monroe County Industrial Development Corp.,
Refunding RB, Series A, 5.00%, 07/01/23(c)

    960       1,049,990  

New York State Dormitory Authority, RB

   

1st Series, (AMBAC), 5.50%, 07/01/40

    1,440       2,174,313  

Series A, 5.25%, 01/01/34

    2,000       2,221,260  

Series A, 5.50%, 01/01/39

    2,000       2,227,800  

Series A, 5.00%, 07/01/43

    1,260       1,584,488  

Series B, 5.00%, 07/01/22(c)

    1,750       1,828,050  

Series B, 5.00%, 07/01/42

    1,225       1,279,598  

New York State Dormitory Authority, Refunding RB

   

5.00%, 07/01/42

    300       311,319  

5.00%, 07/01/44

    2,130       2,397,230  

Series A, 5.00%, 07/01/22(c)

    2,835       2,961,441  

Series A, 5.25%, 07/01/23(c)

    6,820       7,491,906  

Series A, 5.00%, 07/01/24(c)

    500       570,130  

Series A, 5.00%, 07/01/33

    530       618,849  

Series A, 5.00%, 07/01/34

    250       291,625  

Series A, 5.00%, 07/01/35

    3,445       4,014,252  

Series A, 5.00%, 07/01/37

    835       971,481  

Series A, 5.00%, 07/01/38

    255       315,448  

Series A, 5.00%, 07/01/43

    2,960       3,430,788  

Onondaga County Trust for Cultural Resources,

   

Refunding RB, 5.00%, 05/01/40

    1,065       1,226,795  

Orange County Funding Corp., Refunding RB

   

Series A, 5.00%, 07/01/37

    540       562,070  

Series A, 5.00%, 07/01/42

    335       348,253  

Schenectady County Capital Resource Corp.,

   

Refunding RB, 5.00%, 07/01/32

    500       522,490  

St. Lawrence County Industrial Development Agency, RB

   

6.00%, 09/01/34

    150       150,660  

5.38%, 09/01/41

    1,400       1,405,474  

Troy Capital Resource Corp., Refunding RB

   

4.00%, 08/01/35

    890       1,011,485  
Security  

Par

(000)

    Value  

Education (continued)

 

Troy Capital Resource Corp., Refunding RB (continued)

   

4.00%, 09/01/40

  $         1,285     $         1,536,115  

Trust for Cultural Resources of The City of New York, Refunding RB

   

Series A, 5.00%, 07/01/37

    1,105       1,244,042  

Series A, 5.00%, 07/01/41

    500       561,730  

Yonkers Economic Development Corp., RB,
Series A, 5.00%, 10/15/54

    300       352,017  

Yonkers Economic Development Corp., Refunding RB

   

Series A, 5.00%, 10/15/40

    70       85,957  

Series A, 5.00%, 10/15/50

    115       137,961  
   

 

 

 
      63,170,995  

Health — 7.8%

 

Buffalo & Erie County Industrial Land Development Corp., RB, 5.25%, 07/01/35

    500       585,035  

Dutchess County Local Development Corp., RB, Series B, 4.00%, 07/01/41

    2,150       2,448,420  

Huntington Local Development Corp., RB, Series A, 5.25%, 07/01/56

    305       336,625  

Monroe County Industrial Development Corp., RB

   

4.00%, 12/01/41

    600       681,618  

5.00%, 12/01/46

    960       1,152,182  

Monroe County Industrial Development Corp.,

   

Refunding RB

   

4.00%, 12/01/46

    530       626,953  

Series A, 5.00%, 12/01/32

    420       444,662  

Series A, 5.00%, 12/01/37

    1,100       1,163,250  

Nassau County Local Economic Assistance Corp.,

   

Refunding RB, 5.00%, 07/01/22(c)

    2,800       2,924,880  

New York State Dormitory Authority, RB, Series D,

   

4.25%, 05/01/39

    1,000       1,028,650  

New York State Dormitory Authority, Refunding RB

   

4.00%, 07/01/38

    890       1,049,622  

4.00%, 07/01/39

    1,165       1,371,508  

Series A, 5.00%, 05/01/43

    3,430       3,953,761  

Oneida County Local Development Corp., Refunding RB

   

(AGM), 3.00%, 12/01/44

    1,800       1,944,972  

(AGM), 4.00%, 12/01/49

    1,100       1,261,920  

Suffolk County Economic Development Corp., RB,

   

Series C, 5.00%, 07/01/32

    530       598,709  

Tompkins County Development Corp., Refunding RB, 5.00%, 07/01/44

    110       120,385  

Westchester County Healthcare Corp., Refunding RB

   

Series A, Senior Lien, 5.00%, 11/01/21(c)

    4,920       4,978,942  

Series B, Senior Lien, 6.00%, 11/01/30

    85       85,322  

Westchester County Local Development Corp., Refunding RB

   

5.00%, 01/01/28

    675       715,973  

5.00%, 01/01/34

    1,750       1,853,880  
   

 

 

 
      29,327,269  

Housing — 7.3%

 

New York City Housing Development Corp., RB, M/F

   

Housing

   

3.15%, 11/01/44

    250       262,107  

Series B-1, 5.25%, 07/01/30

    750       814,665  

Series B-1, 5.25%, 07/01/32

    2,970       3,217,431  

Series B-1, 5.00%, 07/01/33

    1,300       1,404,195  
 

 

 

32  

2 0 2 1    B L A C K O  C K    N N U A L    E P O R T    T O    H A  R E H O L D E R S


Schedule of Investments  (continued)

July 31, 2021

  

BlackRock New York Municipal Income Trust (BNY)

(Percentages shown are based on Net Assets)

 

 Security   Par
(000)
    Value  
Housing (continued)  

New York City Housing Development Corp., RB, M/F Housing (continued)

   

Series C-1A, 4.20%, 11/01/44

  $ 1,000     $ 1,044,850  

Series F-1, (FHA), 2.50%, 11/01/51

    5,000       5,065,500  

Series I-1, (FHA 542 (C)), 2.65%, 11/01/50

    2,880       2,948,429  

New York City Housing Development Corp., Refunding RB, M/F Housing

   

Series B-1-A, 3.65%, 11/01/49

    1,715       1,834,467  

Series D-A1, (FHA 542 (C)), 2.30%, 11/01/45

    2,665       2,665,826  

New York State Housing Finance Agency, RB, M/F Housing Series B, (FHLMC SONYMA, FNMA, GNMA), 4.00%, 11/01/42.

    110       120,271  

Series E, (SONYMA FANNIE MAE),
4.15%, 11/01/47.

      1,485       1,620,016  

Series H, 4.25%, 11/01/51

    1,000       1,116,740  

Series M-1, (FHA), 2.65%, 11/01/54

    1,600       1,632,832  

Series P, 3.15%, 11/01/54

    1,420       1,480,904  

Series A, AMT, (SONYMA), 5.00%, 02/15/39

    2,175       2,179,937  
   

 

 

 
          27,408,170  
State — 14.4%  

New York City Transitional Finance Authority Building Aid Revenue Refunding RB, (SAW),
4.00%, 07/15/37

    1,145       1,421,517  

New York City Transitional Finance Authority Building Aid Revenue, RB, Sub-Series S-1B, (SAW), 4.00%, 07/15/42

    1,500       1,786,020  

New York City Transitional Finance Authority Building Aid Revenue, Refunding RB, Series S-3, Subordinate, (SAW), 4.00%, 07/15/38

    5,715       6,777,647  

New York State Bridge Authority RB, Series A,
4.00%, 01/01/51

    1,110       1,333,487  

New York State Dormitory Authority, RB

   

Series A, 5.00%, 03/15/36

    1,905       2,324,310  

Series A, 5.00%, 03/15/39

    760       958,634  

Series A, 5.00%, 02/15/42

    2,250       2,724,480  

Series A, 5.00%, 03/15/43

    265       333,055  

Series B, 5.00%, 03/15/37

    2,070       2,131,003  

Series B, 5.00%, 03/15/38

    560       690,637  

Series B, 5.00%, 03/15/39

    960       1,181,251  

Series B, 5.00%, 03/15/42

    6,780       6,977,095  

Series C, 4.00%, 03/15/45

    1,225       1,425,165  

New York State Dormitory Authority,
Refunding RB
5.00%, 05/15/29

    2,000       2,077,740  

Series A, 5.25%, 03/15/39

    3,045       3,927,837  

Series E, 5.00%, 03/15/41

    2,200       2,802,690  

New York State Thruway Authority Highway & Bridge Trust Fund, Refunding RB, Series A,
5.00%, 04/01/32

    2,750       2,837,697  

New York State Thruway Authority,
Refunding RB,

   

Series A-1, 4.00%, 03/15/44

    2,500       3,007,350  

New York State Urban Development Corp., RB

   

Series A, 4.00%, 03/15/49

    4,565       5,392,132  

Series C, 5.00%, 03/15/30

    1,885       2,032,464  

Series C, 5.00%, 03/15/32

    2,000       2,155,380  
   

 

 

 
      54,297,591  
Tobacco — 3.3%  

Chautauqua Tobacco Asset Securitization Corp.,

   

Refunding RB

   

4.75%, 06/01/39

    400       416,572  
Security   Par
(000)
    Value  
Tobacco (continued)  

Chautauqua Tobacco Asset Securitization Corp.,

   

Refunding RB (continued)

   

5.00%, 06/01/48

  $ 500     $ 519,670  

New York Counties Tobacco Trust IV,
Refunding RB,

   

Series A, 6.25%, 06/01/41(a)

    1,400       1,420,062  

New York Counties Tobacco Trust VI,
Refunding RB

   

Series A-2-B, 5.00%, 06/01/45

    430       470,760  

Series A-2-B, 5.00%, 06/01/51

     2,340       2,498,746  

Series C, 4.00%, 06/01/51

    2,250       2,303,415  

Niagara Tobacco Asset Securitization Corp., Refunding RB

   

5.25%, 05/15/34

    250       281,673  

5.25%, 05/15/40

    630       695,866  

TSASC, Inc., Refunding RB,
Series A, 5.00%, 06/01/41

    910       1,063,945  

Westchester Tobacco Asset Securitization Corp.,

   

Refunding RB

   

Sub-Series C, 4.00%, 06/01/42

    1,130       1,248,706  

Sub-Series C, 5.13%, 06/01/51

    1,225       1,407,182  
   

 

 

 
          12,326,597  
Transportation — 23.0%            

Buffalo & Fort Erie Public Bridge Authority, RB,
5.00%, 01/01/47

    1,015       1,226,546  

Hudson Yards Infrastructure Corp., Refunding RB

   

Series A, 5.00%, 02/15/39

    2,440       2,948,252  

Series A, 5.00%, 02/15/42

    2,255       2,714,141  

Metropolitan Transportation Authority, RB

   

Series A, 5.00%, 11/15/21(c)

    575       582,987  

Series A-1, 5.25%, 11/15/23(c)

    1,080       1,206,716  

Series D, 5.25%, 11/15/21(c)

    3,000       3,043,730  

Series E, 5.00%, 11/15/38

    5,650       6,208,050  

Metropolitan Transportation Authority,
Refunding RB

   

Series A-1, 5.25%, 11/15/57

    1,000       1,217,720  

Series B, 5.00%, 11/15/37

    1,000       1,197,520  

Series D, 5.25%, 11/15/23(c)

    1,660       1,854,768  

Series F, 5.00%, 11/15/30

    3,500       3,708,425  

Sub-Series B-1, 5.00%, 11/15/51

    480       571,123  

Sub-Series C-1, 5.00%, 11/15/34

    1,860       2,170,211  

MTA Hudson Rail Yards Trust Obligations, Refunding

   

RB, Series A, 5.00%, 11/15/56

    5,160       5,599,993  

New York City Industrial Development Agency,

   

Refunding RB

   

Series A, AMT, 5.00%, 07/01/22

    1,000       1,042,290  

Series A, AMT, 5.00%, 07/01/28

    1,125       1,171,856  

New York Liberty Development Corp., ARB,
5.25%, 12/15/43

    500       509,110  

New York State Thruway Authority, RB

   

Series A, Junior Lien, 5.00%, 01/01/41

    365       430,609  

Series A, Junior Lien, 5.25%, 01/01/56

    1,130       1,331,818  

New York State Thruway Authority, Refunding RB

   

Series I, 5.00%, 01/01/22(c)

    6,350       6,477,952  

Series J, 5.00%, 01/01/41

    2,500       2,768,950  

Series K, 5.00%, 01/01/32

    3,325       3,839,577  

Series L, 5.00%, 01/01/33

    90       113,785  

Series L, 5.00%, 01/01/34

    140       175,853  

Series L, 5.00%, 01/01/35

    170       213,551  

Series B, Subordinate, 4.00%, 01/01/45

    1,300       1,530,399  

Series B, Subordinate, 4.00%, 01/01/53

    675       788,603  

New York Transportation Development Corp., ARB

   

Series A, AMT, (AGM-CR), 4.00%, 07/01/41

    1,100       1,202,707  
 

 

 

C H E D U L E     O F    N V E S  T M E N T S

  33


Schedule of Investments  (continued)

July 31, 2021

  

BlackRock New York Municipal Income Trust (BNY)

(Percentages shown are based on Net Assets)

 

Security   Par
(000)
     Value  
Transportation (continued)  

New York Transportation Development Corp.,

    

ARB (continued)

    

Series A, AMT, 5.00%, 07/01/41

  $ 1,040      $ 1,172,829  

Series A, AMT, 5.00%, 07/01/46

    1,270        1,427,035  

Series A, AMT, 5.25%, 01/01/50

    7,895        8,933,508  

New York Transportation Development Corp., RB, AMT,

    

4.00%, 04/30/53

    2,000        2,363,280  

Port Authority of New York & New Jersey, ARB,

    

Consolidated, 220th Series, AMT, 4.00%, 11/01/59

     2,320        2,667,095  

Port Authority of New York & New Jersey, Refunding

    

ARB

    

Series 179, 5.00%, 12/01/38

    820        908,339  

178th Series, AMT, 5.00%, 12/01/43

    930        1,021,856  

195th Series, AMT, 5.00%, 04/01/36

    750        907,462  

Consolidated, 177th Series, AMT, 4.00%, 01/15/43

    1,120        1,174,790  

Series 178th, AMT, 5.00%, 12/01/33

    750        828,128  

Triborough Bridge & Tunnel Authority, RB

    

Series A, 5.00%, 11/15/42

    1,000        1,222,260  

Series A, 5.00%, 11/15/56

    360        468,662  

Series B, 5.00%, 11/15/40

    870        1,027,287  

Series B, 5.00%, 11/15/45

    310        364,653  

Triborough Bridge & Tunnel Authority, Refunding RB

    

Series A, 5.00%, 11/15/29

    810        879,555  

Series A, 5.25%, 11/15/45

    1,330        1,551,937  

Series A, 5.00%, 11/15/50

    1,000        1,153,140  

Series B, 5.00%, 11/15/38

    725        894,411  

Triborough Bridge & Tunnel Authority, Refunding RB,

    

CAB, Series B, 0.00%, 11/15/32(d)

    2,335        1,939,428  
    

 

 

 
           86,752,897  
Utilities — 14.1%  

Albany Municipal Water Finance Authority, Refunding RB, Series A, 5.00%, 12/01/21(c)

    1,000        1,016,070  

Long Island Power Authority, RB

    

(AGM), 0.00%, 06/01/28(d)

    3,515        3,253,554  

5.00%, 09/01/36

    340        424,096  

5.00%, 09/01/38

    3,375        4,285,879  

5.00%, 09/01/42

    290        359,513  

5.00%, 09/01/47

    1,640        2,023,842  

Series C, (AGC), 5.25%, 09/01/29

    4,000        5,287,160  

Long Island Power Authority, Refunding RB, Series B, 5.00%, 09/01/46

    515        617,052  

New York City Water & Sewer System RB, 3.00%, 06/15/51

    5,000        5,453,100  

New York City Water & Sewer System, RB

    

Series DD, 5.25%, 06/15/47

    245        302,031  

Series DD-1, 4.00%, 06/15/50

    3,965        4,704,631  

Series CC-1, Subordinate, 4.00%, 06/15/51

    5,000        5,989,550  

New York City Water & Sewer System, Refunding RB

    

4.00%, 06/15/40

    1,825        2,195,256  

Series EE, 5.00%, 06/15/40

    700        875,217  

Series HH, 5.00%, 06/15/39

    3,500        4,098,710  

Sub-Series AA-1, 4.00%, 06/15/50

    1,000        1,190,440  

Sub-Series FF-2, Subordinate, 4.00%, 06/15/41

    455        545,904  

New York Power Authority, Refunding RB, Series A, 5.00%, 11/15/21(c)

    1,000        1,013,890  

New York State Environmental Facilities Corp., RB

    

Series B, 5.00%, 09/15/40

    635        736,416  
Security   Par
(000)
     Value  
Utilities (continued)  

New York State Environmental Facilities Corp., RB (continued)

    

Series B, Subordinate, 5.00%, 06/15/48

  $ 1,760      $ 2,219,765  

Utility Debt Securitization Authority, Refunding RB, Series TE, Restructured,
5.00%, 12/15/41

    5,690        6,293,652  

Western Nassau County Water Authority, RB, Series A, 5.00%, 04/01/25(c)

    250        293,728  
    

 

 

 
       53,179,456  
    

 

 

 

Total Municipal Bonds in New York

       460,850,469  
Puerto Rico — 6.0%  
State — 4.9%  

Puerto Rico Sales Tax Financing Corp. Sales Tax Revenue, RB

    

Series A-1, Restructured, 4.75%, 07/01/53

     1,731            1,991,256  

Series A-1, Restructured, 5.00%, 07/01/58

    7,731        9,007,620  

Series A-2, Restructured, 4.33%, 07/01/40

    3,004        3,412,093  

Series A-2, Restructured, 4.78%, 07/01/58

    1,544        1,775,291  

Series B-1, Restructured, 4.75%, 07/01/53

    130        149,546  

Series B-2, Restructured, 4.78%, 07/01/58

    126        144,952  

Puerto Rico Sales Tax Financing Corp. Sales Tax Revenue, RB, CAB, Series A-1, Restructured,
0.00%, 07/01/46(d)

    5,916        1,976,417  
    

 

 

 
       18,457,175  
Tobacco — 0.4%  

Children’s Trust Fund, Refunding RB, 5.63%, 05/15/43

    1,385        1,401,121  
    

 

 

 
Utilities — 0.7%  

Puerto Rico Commonwealth Aqueduct & Sewer

    

Authority, RB

    

Series A, Senior Lien, 5.00%, 07/01/33

    2,160        2,236,832  

Series A, Senior Lien, 5.13%, 07/01/37

    620        641,303  
    

 

 

 
       2,878,135  
    

 

 

 

Total Municipal Bonds in Puerto Rico

       22,736,431  
    

 

 

 

Total Municipal Bonds — 128.4%
(Cost: $439,732,257)

       483,586,900  
    

 

 

 

Municipal Bonds Transferred to Tender Option Bond Trusts(e)

 

New York — 34.9%  
County/City/Special District/School District — 4.2%  

City of New York, GO

    

Sub-Series I-1, 5.00%, 03/01/36

    2,250        2,516,962  

Sub-Series-D1, Series D, 5.00%, 12/01/43(f)

    4,000        5,068,120  

City of New York, Refunding GO, Series B,
4.00%, 08/01/32

    1,790        1,973,511  

Hudson Yards Infrastructure Corp., RB,
5.75%, 02/15/47(f)

    989        993,086  

New York City Transitional Finance Authority Future Tax

    

Secured Revenue, RB

    

Sub-Series D-1, 5.00%, 11/01/38

    3,300        3,339,171  

Sub-Series F-1, 5.00%, 05/01/38

    1,424        1,772,299  
    

 

 

 
       15,663,149  
Education — 1.2%  

Trust for Cultural Resources of The City of New York, Refunding RB, Series A, 5.00%, 08/01/23(c)

    4,038        4,432,554  
    

 

 

 
 

 

 

34  

2 0 2 1    B L A C K O  C K    N N U A L    E P O R T    T O    H A  R E H O L D E R S


Schedule of Investments  (continued)

July 31, 2021

  

BlackRock New York Municipal Income Trust (BNY)

(Percentages shown are based on Net Assets)

 

Security  

Par

(000)

     Value  
Housing — 1.6%             

New York City Housing Development Corp., Refunding

    

RB, Series A, 4.25%, 11/01/43

  $ 5,360      $ 5,993,230  
    

 

 

 
State — 3.7%             

New York State Dormitory Authority, RB, Series A, 5.00%, 03/15/32

    1,000        1,276,020  

New York State Dormitory Authority, Refunding RB, Series C, 5.00%, 03/15/39

    1,000        1,261,360  

New York State Thruway Authority, Refunding RB, Series A, 5.00%, 03/15/31

    1,980        1,991,385  

New York State Urban Development Corp.,
RB, Series A, 4.00%, 03/15/47

    3,503        4,080,532  

Sales Tax Asset Receivable Corp., Refunding RB(c)

    

Series A, 4.00%, 10/15/24

    2,850        3,198,983  

Series A, 5.00%, 10/15/24

    1,995        2,302,908  
    

 

 

 
       14,111,188  
Transportation — 15.9%             

New York Liberty Development Corp., ARB,
5.25%, 12/15/43

    11,985        12,203,023  

New York Liberty Development Corp., Refunding RB,

    

Class 1, 5.00%, 09/15/40

    4,695        4,833,409  

New York State Thruway Authority, Refunding RB(f)

    

Series B, Subordinate, 4.00%, 01/01/45

    5,998        7,061,290  

Series B, Subordinate, 4.00%, 01/01/53

    4,489        5,244,470  

Port Authority of New York & New Jersey,
ARB, AMT, Series 221, 4.00%, 07/15/60

    2,863        3,330,514  

Port Authority of New York & New Jersey, Refunding ARB

    

194th Series, 5.25%, 10/15/55

    2,925        3,467,968  

Consolidated, 169th Series, AMT, 5.00%, 10/15/26

    2,500        2,523,550  

Consolidated, Series 211, 5.00%, 09/01/48

    4,760        6,002,503  

Triborough Bridge & Tunnel Authority, RB,
Series A, 4.00%, 11/15/54(f)

    8,059        9,625,950  

Triborough Bridge & Tunnel Authority, Refunding RB

    

Series A, 5.00%, 11/15/46

    3,000        3,575,400  

Series C-2, 5.00%, 11/15/42

    1,665        2,060,854  
    

 

 

 
       59,928,931  
Utilities — 8.3%             

New York City Water & Sewer System, Refunding RB,

    

Series BB, 5.00%, 06/15/44

    6,527        6,640,118  

New York Power Authority, Refunding RB,
Series A, 4.00%, 11/15/60

    7,126        8,499,439  

Utility Debt Securitization Authority, Refunding RB

    

Series A, Restructured, 5.00%, 12/15/35

    3,000        3,644,340  

Series B, 4.00%, 12/15/35

    840        980,272  

Series TE, Restructured, 5.00%, 12/15/41

    10,587        11,709,959  
    

 

 

 
       31,474,128  
    

 

 

 

Total Municipal Bonds in New York

       131,603,180  
    

 

 

 

Total Municipal Bonds Transferred to Tender Option Bond
Trusts — 34.9%
(Cost: $121,543,847)

       131,603,180  
    

 

 

 

Total Long-Term Investments — 163.3%
(Cost: $561,276,104)

       615,190,080  
    

 

 

 
Security  

    

Shares

     Value  
Short-Term Securities             
Money Market Funds — 2.3%             

BlackRock Liquidity Funds New York Money Fund Portfolio, 0.01%(g)(h)

    8,503,848      $ 8,503,848  
    

 

 

 

Total Short-Term Securities — 2.3%
(Cost: $8,503,848)

       8,503,848  
    

 

 

 

Total Investments — 165.6%
(Cost: $569,779,952)

       623,693,928  

Other Assets Less Liabilities — 1.2%

       4,644,755  

Liability for TOB Trust Certificates, Including Interest Expense and Fees Payable — (19.2)%

       (72,286,590

VRDP Shares at Liquidation Value, Net of Deferred Offering Costs — (47.6)%

       (179,407,541
    

 

 

 

Net Assets Applicable to Common Shares — 100.0%

     $ 376,644,552  
    

 

 

 

 

(a)

Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registration to qualified institutional investors.

(b)

Variable rate security. Interest rate resets periodically. The rate shown is the effective interest rate as of period end. Security description also includes the reference rate and spread if published and available.

(c)

U.S. Government securities held in escrow, are used to pay interest on this security as well as to retire the bond in full at the date indicated, typically at a premium to par.

(d)

Zero-coupon bond.

(e)

Represent bonds transferred to a TOB Trust in exchange of cash and residual certificates received by the Trust. These bonds serve as collateral in a secured borrowing. See Note 4 of the Notes to Financial Statements for details.

(f)

All or a portion of the security is subject to a recourse agreement. The aggregate maximum potential amount the Trust could ultimately be required to pay under the agreements, which expire between December 1, 2026 to February 15, 2047, is $15,365,712. See Note 4 of the Notes to Financial Statements for details.

(g)

Affiliate of the Trust.

(h)

Annualized 7-day yield as of period end.

 

 

For Trust compliance purposes, the Trust’s sector classifications refer to one or more of the sector sub-classifications used by one or more widely recognized market indexes or rating group indexes, and/or as defined by the investment adviser. These definitions may not apply for purposes of this report, which may combine such sector sub-classifications for reporting ease.

 

 

C H E D U L E    O F    N V E S T  M E N T S

  35


Schedule of Investments  (continued)    BlackRock New York Municipal Income Trust (BNY)
July 31, 2021   

 

Affiliates

Investments in issuers considered to be affiliate(s) of the Trust during the year ended July 31, 2021 for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:

 

Affiliated Issuer    Value at
07/31/20
     Purchases
at Cost
     Proceeds
from Sales
     Net
Realized
Gain (Loss)
    

Change in
Unrealized

Appreciation
(Depreciation)

    

Value at

07/31/21

     Shares
Held at
07/31/21
     Income     

Capital Gain
Distributions
from
Underlying

Funds

 

BlackRock Liquidity Funds New York Money Fund Portfolio

   $ 410,715      $ 8,093,501 (a)     $      $ (368    $      $ 8,503,848        8,503,848      $ 353      $  
           

 

 

    

 

 

    

 

 

       

 

 

    

 

 

 

 

  (a)

Represents net amount purchased (sold).

 

Derivative Financial Instruments Outstanding as of Period End

Futures Contracts

 

Description    Number of
Contracts
     Expiration
Date
     Notional
Amount (000)
     Value/
Unrealized
Appreciation
(Depreciation)
 

Short Contracts

           

10-Year U.S. Treasury Note

     114        09/21/21      $ 15,337      $ (275,420

U.S. Long Bond

     83        09/21/21        13,692        (713,413

5-Year U.S. Treasury Note

     106        09/30/21        13,195        (123,542
           

 

 

 
            $ (1,112,375
           

 

 

 

Derivative Financial Instruments Categorized by Risk Exposure

As of period end, the fair values of derivative financial instruments located in the Statements of Assets and Liabilities were as follows:

 

      Commodity
Contracts
     Credit
Contracts
     Equity
Contracts
    

Foreign
Currency

Exchange
Contracts

    

Interest

Rate
Contracts

     Other
Contracts
     Total  

Liabilities — Derivative Financial Instruments

                    

Futures contracts

                    

Unrealized depreciation on futures contracts(a)

   $             —      $             —      $             —      $             —      $ 1,112,375      $             —      $ 1,112,375  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

  (a)

Net cumulative unrealized appreciation (depreciation) on futures contracts and centrally cleared swaps, if any, are reported in the Schedule of Investments. In the Statements of Assets and Liabilities, only current day’s variation margin is reported in receivables or payables and the net cumulative unrealized appreciation (depreciation) is included in accumulated earnings (loss).

 

For the year ended July 31, 2021, the effect of derivative financial instruments in the Statements of Operations was as follows:

 

      Commodity
Contracts
     Credit
Contracts
     Equity
Contracts
     Foreign
Currency
Exchange
Contracts
    

Interest

Rate
Contracts

     Other
Contracts
     Total  

Net Realized Gain (Loss) from

                    

Futures contracts

   $      $      $      $      $ 683,965      $      $ 683,965  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net Change in Unrealized Appreciation (Depreciation) on

                    

Futures contracts

   $      $      $      $      $ (1,112,375    $      $ (1,112,375
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Average Quarterly Balances of Outstanding Derivative Financial Instruments

 

Futures contracts

        

Average notional value of contracts — short

   $ 23,372,445  

For more information about the Trust’s investment risks regarding derivative financial instruments, refer to the Notes to Financial Statements.

 

 

36  

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Schedule of Investments  (continued)    BlackRock New York Municipal Income Trust (BNY)
July 31, 2021   

 

Fair Value Hierarchy as of Period End

Various inputs are used in determining the fair value of financial instruments. For a description of the input levels and information about the Trust’s policy regarding valuation of financial instruments, refer to the Notes to Financial Statements.

The following table summarizes the Trust’s financial instruments categorized in the fair value hierarchy. The breakdown of the Trust’s financial instruments into major categories is disclosed in the Schedule of Investments above.

 

      Level 1        Level 2        Level 3        Total  

Assets

                 

Investments

                 

Long-Term Investments

                 

Municipal Bonds

   $        $ 483,586,900        $        $ 483,586,900  

Municipal Bonds Transferred to Tender Option Bond Trusts

              131,603,180                   131,603,180  

Short-Term Securities

                 

Money Market Funds

     8,503,848                            8,503,848  
  

 

 

      

 

 

      

 

 

      

 

 

 
   $ 8,503,848        $ 615,190,080        $        $ 623,693,928  
  

 

 

      

 

 

      

 

 

      

 

 

 

Derivative Financial Instruments(a)

                 

Liabilities

                 

Interest Rate Contracts

   $ (1,112,375      $        $        $ (1,112,375
  

 

 

      

 

 

      

 

 

      

 

 

 

 

  (a)

Derivative financial instruments are futures contracts. Futures contracts are valued at the unrealized appreciation (depreciation) on the instrument.

 

The Trust may hold assets and/or liabilities in which the fair value approximates the carrying amount for financial statement purposes. As of period end, such assets and/or liabilities are categorized within the fair value hierarchy as follows:

 

      Level 1        Level 2        Level 3        Total  

Liabilities

                 

TOB Trust Certificates

   $        $ (72,273,255      $        $ (72,273,255

VRDP Shares at Liquidation Value

              (179,400,000                 (179,400,000
  

 

 

      

 

 

      

 

 

      

 

 

 
   $             —        $ (251,673,255      $             —        $ (251,673,255
  

 

 

      

 

 

      

 

 

      

 

 

 

See notes to financial statements.

 

 

C H E D U L E    O F    N V E S T  M E N T S

  37


Statements of Assets and Liabilities

July 31, 2021

 

     BFZ      BTT      BNY  

ASSETS

       

Investments, at value — unaffiliated(a)

  $  818,642,243      $  2,842,388,241      $  615,190,080  

Investments, at value — affiliated(b)

           50,951,950        8,503,848  

Cash

                  17,705  

Cash pledged for futures contracts

    566,000               555,000  

Receivables:

       

Investments sold

           125,000        40,000  

Dividends — affiliated

    6        267        71  

Interest — unaffiliated

    8,565,454        24,435,658        5,536,131  

From the Manager

                  180,344  

Prepaid expenses

    25,993        3,425        414,753  
 

 

 

    

 

 

    

 

 

 

Total assets

    827,799,696        2,917,904,541        630,437,932  
 

 

 

    

 

 

    

 

 

 

ACCRUED LIABILITIES

       

Bank overdraft

    377,788                

Payables:

       

Investments purchased

           2,995,738         

Accounting services fees

    42,636        250,970        99,246  

Custodian fees

    7,541        24,745        8,081  

Income dividend distributions — Common Shares

    1,347,692        4,399,548        1,390,712  

Interest expense and fees

    33,901        58,086        13,335  

Investment advisory fees

    406,375        984,820        293,561  

Trustees’ and Officer’s fees

    107,574        12,774        72,294  

Other accrued expenses

    28,256        72,387        43,291  

Professional fees

    94,244        151,958        71,625  

Variation margin on futures contracts

    122,223               120,439  
 

 

 

    

 

 

    

 

 

 

Total accrued liabilities

    2,568,230        8,951,026        2,112,584  
 

 

 

    

 

 

    

 

 

 

OTHER LIABILITIES

       

TOB Trust Certificates

    143,275,836        233,219,979        72,273,255  

RVMTP Shares, at liquidation value of $5,000,000 per share, net of deferred offering costs(c)(d)(e)

           749,705,274         

VRDP Shares, at liquidation value of $100,000 per share, net of deferred offering costs(c)(d)(e)

                  179,407,541  

VMTP Shares, at liquidation value of $100,000 per share(c)(d)(e)

    171,300,000                
 

 

 

    

 

 

    

 

 

 

Total other liabilities

    314,575,836        982,925,253        251,680,796  
 

 

 

    

 

 

    

 

 

 

Total liabilities

    317,144,066        991,876,279        253,793,380  
 

 

 

    

 

 

    

 

 

 

NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS

  $ 510,655,630      $ 1,926,028,262      $ 376,644,552  
 

 

 

    

 

 

    

 

 

 

NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS CONSIST OF

       

Paid-in capital(f)(g)(h)

  $ 439,679,321      $ 1,680,559,310      $ 336,668,727  

Accumulated earnings

    70,976,309        245,468,952        39,975,825  
 

 

 

    

 

 

    

 

 

 

NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS

  $ 510,655,630      $ 1,926,028,262      $ 376,644,552  
 

 

 

    

 

 

    

 

 

 

Net asset value per Common Share

  $ 16.29      $ 27.32      $ 15.30  
 

 

 

    

 

 

    

 

 

 

(a) Investments, at cost — unaffiliated

  $ 746,979,877      $ 2,597,227,010      $ 561,276,104  

(b) Investments, at cost — affiliated

  $      $ 50,943,523      $ 8,503,848  

(c)  Preferred Shares outstanding

    1,713        150        1,794  

(d) Preferred Shares authorized

    1,713        150        Unlimited  

(e) Par value per Preferred Share

  $ 0.001      $ 0.001      $ 0.001  

(f)  Common Shares outstanding

    31,341,683        70,505,571        24,614,382  

(g) Common Shares authorized

    Unlimited        Unlimited        Unlimited  

(h) Par value per Common Share

  $ 0.001      $ 0.001      $ 0.001  

See notes to financial statements.

 

 

38  

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Statements of Operations

Year Ended July 31, 2021

 

     BFZ     BTT     BNY  

INVESTMENT INCOME

     

Dividends — affiliated

  $ 302     $ 6,302     $ 353  

Interest — unaffiliated

    24,290,309       89,416,460       15,162,334  
 

 

 

   

 

 

   

 

 

 

Total investment income

    24,290,611       89,422,762       15,162,687  
 

 

 

   

 

 

   

 

 

 

EXPENSES

     

Investment advisory

    4,720,853       11,486,505       2,445,644  

Professional

    107,367       120,224       87,027  

Trustees and Officer

    51,778       106,150       23,647  

Accounting services

    46,118       271,200       64,026  

Transfer agent

    34,186       79,187       29,585  

Registration

    10,878       24,047       3,393  

Custodian

    7,721       26,596       4,370  

Liquidity fees

                5,873  

Remarketing fees on Preferred Shares

                5,741  

Reorganization

                119,568  

Miscellaneous

    71,310       93,383       102,257  
 

 

 

   

 

 

   

 

 

 

Total expenses excluding interest expense, fees and amortization of offering costs

    5,050,211       12,207,292       2,891,131  

Interest expense, fees and amortization of offering costs(a)

    2,395,901       6,782,415       1,442,241  
 

 

 

   

 

 

   

 

 

 

Total expenses

    7,446,112       18,989,707       4,333,372  

Less:

     

Fees waived and/or reimbursed by the Manager

    (380     (36,822     (119
 

 

 

   

 

 

   

 

 

 

Total expenses after fees waived and/or reimbursed

    7,445,732       18,952,885       4,333,253  
 

 

 

   

 

 

   

 

 

 

Net investment income

    16,844,879       70,469,877       10,829,434  
 

 

 

   

 

 

   

 

 

 

REALIZED AND UNREALIZED GAIN (LOSS)

     

Net realized gain (loss) from:

     

Investments — unaffiliated

    3,963,874       7,081,552       371,247  

Investments — affiliated

    1,254       (935     (368

Futures contracts

    1,319,056             683,965  
 

 

 

   

 

 

   

 

 

 
    5,284,184       7,080,617       1,054,844  
 

 

 

   

 

 

   

 

 

 

Net change in unrealized appreciation (depreciation) on:

     

Investments — unaffiliated

    6,898,470       46,394,678       6,608,895  

Investments — affiliated

          5,062        

Futures contracts

    (817,912           (1,112,375
 

 

 

   

 

 

   

 

 

 
    6,080,558       46,399,740       5,496,520  
 

 

 

   

 

 

   

 

 

 

Net realized and unrealized gain

    11,364,742       53,480,357       6,551,364  
 

 

 

   

 

 

   

 

 

 

NET INCREASE IN NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS RESULTING FROM OPERATIONS

  $  28,209,621     $  123,950,234     $  17,380,798  
 

 

 

   

 

 

   

 

 

 

 

(a)

Related to TOB Trusts, VMTP Shares, RVMTP Shares and/or VRDP Shares.

See notes to financial statements.

 

 

I N A N C I A L    T A T E M E N T  S

  39


Statements of Changes in Net Assets

 

    BFZ     BTT  
    Year Ended July 31,     Year Ended July 31,  
    2021     2020     2021     2020  

 

 

INCREASE (DECREASE) IN NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS

       

OPERATIONS

       

Net investment income

  $ 16,844,879     $ 15,302,566     $ 70,469,877     $ 65,164,868  

Net realized gain (loss)

    5,284,184       (4,992,260     7,080,617       627,376  

Net change in unrealized appreciation (depreciation)

    6,080,558       22,918,213       46,399,740       37,136,626  
 

 

 

   

 

 

   

 

 

   

 

 

 

Net increase in net assets applicable to Common Shareholders resulting from operations

    28,209,621       33,228,519       123,950,234       102,928,870  
 

 

 

   

 

 

   

 

 

   

 

 

 

DISTRIBUTIONS TO COMMON SHAREHOLDERS(a)

       

Decrease in net assets resulting from distributions to Common Shareholders

    (15,094,334     (14,967,273     (52,794,572     (52,794,572
 

 

 

   

 

 

   

 

 

   

 

 

 

CAPITAL SHARE TRANSACTIONS

       

Redemption of shares resulting from share repurchase program (including transaction costs)

    (2,813,059     (4,493,469            
 

 

 

   

 

 

   

 

 

   

 

 

 

NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS

       

Total increase in net assets applicable to Common Shareholders

    10,302,228       13,767,777       71,155,662       50,134,298  

Beginning of year

    500,353,402       486,585,625       1,854,872,600       1,804,738,302  
 

 

 

   

 

 

   

 

 

   

 

 

 

End of year

  $  510,655,630     $  500,353,402     $  1,926,028,262     $  1,854,872,600  
 

 

 

   

 

 

   

 

 

   

 

 

 

 

(a)

Distributions for annual periods determined in accordance with U.S. federal income tax regulations.

See notes to financial statements.

 

 

40  

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Statements of Changes in Net Assets (continued)

 

    BNY  
   

 

Year Ended July 31,

 
    2021     2020  

 

 

INCREASE (DECREASE) IN NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS

   

OPERATIONS

   

Net investment income

  $ 10,829,434     $ 7,862,512  

Net realized gain (loss)

    1,054,844       (3,165,455

Net change in unrealized appreciation (depreciation)

    5,496,520       2,584,667  
 

 

 

   

 

 

 

Net increase in net assets applicable to Common Shareholders resulting from operations

    17,380,798       7,281,724  
 

 

 

   

 

 

 

DISTRIBUTIONS TO COMMON SHAREHOLDERS(a)

   

Decrease in net assets resulting from distributions to Common Shareholders

    (11,402,477     (7,305,530
 

 

 

   

 

 

 

CAPITAL SHARE TRANSACTIONS

   

Net proceeds from the issuance of common shares due to reorganization

    174,624,251        

Reinvestment of common distributions

    197,657        

Redemption of common shares

    (129      
 

 

 

   

 

 

 

Net increase in net assets derived from capital share transactions

    174,821,779        
 

 

 

   

 

 

 

NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS

   

Total increase (decrease) in net assets applicable to Common Shareholders

    180,800,100       (23,806

Beginning of year

    195,844,452       195,868,258  
 

 

 

   

 

 

 

End of year

  $  376,644,552     $  195,844,452  
 

 

 

   

 

 

 

 

(a)

Distributions for annual periods determined in accordance with U.S. federal income tax regulations.

See notes to financial statements.

 

 

I N A N C I A L    T A T E M E N T  S

  41


Statements of Cash Flows

Year Ended July 31, 2021

 

     BFZ     BTT     BNY  

CASH PROVIDED BY (USED FOR) OPERATING ACTIVITIES

     

Net increase in net assets resulting from operations

  $ 28,209,621     $ 123,950,234     $ 17,380,798  

Adjustments to reconcile net increase in net assets resulting from operations to net cash provided by operating activities

     

Proceeds from sales of long-term investments

    155,295,347       262,251,066       64,623,695  

Purchases of long-term investments

    (163,585,900     (267,151,425     (49,842,344

Net proceeds from sales (purchases) of short-term securities

    615,295       3,087,499       (8,093,501

Amortization of premium and accretion of discount on investments and other fees

    8,399,175       12,259,468       2,382,910  

Net realized gain on investments

    (3,965,128     (7,080,617     (372,879

Net unrealized appreciation on investments

    (6,898,470     (46,399,740     (6,608,895

(Increase) Decrease in Assets

     

Receivables

     

Dividends — affiliated

    48       1,856       (43

From the Manager

                (180,344

Interest — unaffiliated

    58,838       583,166       1,113,337  

Prepaid expenses

    (7,776     39,568       (383,898

Increase (Decrease) in Liabilities

     

Payables

     

Accounting services fees

    19,219       114,304       23,951  

Custodian fees

    2,533       11,022       (14,440

Interest expense and fees

    (199,358     (331,151     (32,714

Investment advisory fees

    9,934       28,072       (62,238

Trustees’ and Officer’s fees

    22,693       628       8,880  

Other accrued expenses

    4,020       (5,212     234,276  

Professional fees

    26,008       4,499       (23,839

Reorganization costs

                (34,673

Variation margin on futures contracts

    122,223             120,439  
 

 

 

   

 

 

   

 

 

 

Net cash provided by operating activities

    18,128,322       81,363,237       20,238,478  
 

 

 

   

 

 

   

 

 

 

CASH PROVIDED BY (USED FOR) FINANCING ACTIVITIES

     

Cash dividends paid to Common Shareholders

    (14,947,399     (52,794,572     (11,879,511

Repayments of TOB Trust Certificates

    (5,600,000     (51,304,981     (11,482,544

Repayments of Loan for TOB Trust Certificates

    (5,600,000     (2,700,000     (2,352,204

Net payments on Common Shares redeemed

    (2,929,880           (129

Proceeds from TOB Trust Certificates

    5,600,000       22,705,045       3,712,204  

Proceeds from Loan for TOB Trust Certificates

    5,600,000       2,700,000       2,352,204  

Increase (decrease) in bank overdraft

    314,957             (23,334

Amortization of deferred offering costs

          31,271       7,541  
 

 

 

   

 

 

   

 

 

 

Net cash used for financing activities

    (17,562,322     (81,363,237     (19,665,773
 

 

 

   

 

 

   

 

 

 

CASH

     

Net increase in restricted and unrestricted cash

    566,000             572,705  

Restricted and unrestricted cash at beginning of year

                 
 

 

 

   

 

 

   

 

 

 

Restricted and unrestricted cash at end of year

  $ 566,000     $     $ 572,705  
 

 

 

   

 

 

   

 

 

 

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION

     

Cash paid during the year for interest expense

  $ 2,595,259     $ 7,082,295     $ 1,467,414  
 

 

 

   

 

 

   

 

 

 

NON-CASH FINANCING ACTIVITIES

     

Capital shares issued in reinvestment of distributions paid to Common Shareholders

  $     $     $ 197,657  
 

 

 

   

 

 

   

 

 

 

Fair value of investments acquired through reorganization

                293,258,631  
 

 

 

   

 

 

   

 

 

 

Common Shares issued in reorganization

                174,624,251  
 

 

 

   

 

 

   

 

 

 

Preferred Shares issued in reorganization

                84,900,000  
 

 

 

   

 

 

   

 

 

 

 

 

42  

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Statements of Cash Flows  (continued)

Year Ended July 31, 2021

 

     BFZ      BTT      BNY  

RECONCILIATION OF RESTRICTED AND UNRESTRICTED CASH AT THE END OF YEAR TO THE STATEMENTS OF ASSETS AND LIABILITIES

       

Cash

  $      $      $ 17,705  

Cash pledged

       

Futures contracts

    566,000               555,000  
 

 

 

    

 

 

    

 

 

 
  $     566,000      $             —      $     572,705  
 

 

 

    

 

 

    

 

 

 

See notes to financial statements.

 

 

I N A N C I A L    T A T E M E N T  S

  43


Financial Highlights

(For a share outstanding throughout each period)

 

    BFZ  
   

 

Year Ended July 31,

 

 
    2021      2020      2019      2018      2017  

 

 

Net asset value, beginning of year

  $ 15.86      $ 15.25      $ 14.81      $ 15.34      $ 16.35  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net investment income(a)

    0.54        0.48        0.52        0.65        0.73  

Net realized and unrealized gain (loss)

    0.37        0.60        0.63        (0.51      (0.97
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net increase (decrease) from investment operations

    0.91        1.08        1.15        0.14        (0.24
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Distributions to Common Shareholders(b)

             

From net investment income

    (0.48      (0.47      (0.55      (0.67      (0.77

From net realized gain

                  (0.16              
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total distributions to Common Shareholders

    (0.48      (0.47      (0.71      (0.67      (0.77
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net asset value, end of year

  $ 16.29      $ 15.86      $ 15.25      $ 14.81      $ 15.34  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Market price, end of year

  $ 15.01      $ 13.79      $ 13.50      $ 12.75      $ 14.71  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total Return Applicable to Common Shareholders(c)

             

Based on net asset value

    6.24      7.69      8.89      1.41      (1.22 )% 
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Based on market price

    12.59      5.77      11.96      (8.95 )%       (7.59 )% 
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Ratios to Average Net Assets Applicable to Common Shareholders

             

Total expenses

    1.49      2.17      2.76      2.41      2.14
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total expenses after fees waived and/or reimbursed.

    1.49      2.17      2.76      2.41      2.14
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total expenses after fees waived and/or reimbursed and excluding interest expense, fees, and amortization of offering costs(d)

    1.01      1.02      1.06      1.05      1.07
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net investment income to Common Shareholders

    3.37      3.14      3.56      4.33      4.73
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Supplemental Data

             

Net assets applicable to Common Shareholders, end of year (000)

  $  510,656      $  500,353      $  486,586      $  472,407      $  489,328  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

VMTP Shares outstanding at $100,000 liquidation value, end of year (000)

  $ 171,300      $ 171,300      $ 171,300      $ 171,300      $ 171,300  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Asset coverage per VMTP Shares at $100,000 liquidation value, end of year

  $ 398,106      $ 392,092      $ 384,055      $ 375,778      $ 385,656  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Borrowings outstanding, end of year (000)

  $ 143,276      $ 143,276      $ 156,312      $ 157,126      $ 169,863  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Portfolio turnover rate

    19      38      51      45      38
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

(a) 

Based on average Common Shares outstanding.

(b) 

Distributions for annual periods determined in accordance with U.S. federal income tax regulations.

(c) 

Total returns based on market price, which can be significantly greater or less than the net asset value, may result in substantially different returns. Where applicable, excludes the effects of any sales charges and assumes the reinvestment of distributions at actual reinvestment prices.

(d) 

Interest expense, fees and amortization of offering costs related to TOB Trusts and/or VMTP Shares. See Note 4 and Note 10 of the Notes to Financial Statements for details.

See notes to financial statements.

 

 

44  

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Financial Highlights (continued)

(For a share outstanding throughout each period)

 

    BTT  
    Year Ended July 31,  
     2021      2020      2019      2018      2017  

Net asset value, beginning of year

  $ 26.31      $ 25.60      $ 23.62      $ 23.83      $ 25.38  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net investment income(a)

    1.00        0.92        0.80        0.85        0.90  

Net realized and unrealized gain (loss)

    0.76        0.54        1.93        (0.21      (1.50
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net increase (decrease) from investment operations

    1.76        1.46        2.73        0.64        (0.60
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Distributions to Common Shareholders from net investment income(b)

    (0.75      (0.75      (0.75      (0.85      (0.95
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net asset value, end of year

  $ 27.32      $ 26.31      $ 25.60      $ 23.62      $ 23.83  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Market price, end of year

  $ 26.27      $ 24.78      $ 23.49      $ 21.43      $ 23.14  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total Return Applicable to Common Shareholders(c)

             

Based on net asset value

    6.92      6.04      12.17      3.04      (2.14 )% 
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Based on market price

    9.16      8.84      13.45      (3.73 )%       (0.51 )% 
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Ratios to Average Net Assets Applicable to Common Shareholders

             

Total expenses

    1.01      1.56      2.07      1.76      1.49 %(d)  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total expenses after fees waived and/or reimbursed

    1.01      1.56      2.07      1.76      1.49 %(d)  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total expenses after fees waived and/or reimbursed and excluding interest expense, fees, and amortization of offering costs(e)

    0.65      0.67      0.69      0.69      0.68 %(d)  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net investment income to Common Shareholders

    3.74      3.60      3.31      3.55      3.80 %(d)  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Supplemental Data

             

Net assets applicable to Common Shareholders, end of year (000)

  $ 1,926,028      $ 1,854,873      $ 1,804,738      $ 1,665,198      $ 1,679,841  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

RVMTP Shares outstanding at $5,000,000 liquidation value, end of year (000)

  $ 750,000      $ 750,000      $ 750,000      $ 750,000      $ 750,000  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Asset coverage per RVMTP Shares at $5,000,000 liquidation value, end of year

  $ 356,804      $ 347,316      $ 340,632      $ 16,101,317      $ 16,198,941  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Borrowings outstanding, end of year (000)

  $ 233,220      $ 261,820      $ 261,820      $ 261,820      $ 184,115  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Portfolio turnover rate

    9      5      21      23      32
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

(a) 

Based on average Common Shares outstanding.

(b) 

Distributions for annual periods determined in accordance with U.S. federal income tax regulations.

(c) 

Total returns based on market price, which can be significantly greater or less than the net asset value, may result in substantially different returns. Where applicable, excludes the effects of any sales charges and assumes the reinvestment of distributions at actual reinvestment prices.

(d) 

Excludes expenses incurred indirectly as a result of investments in underlying funds of 0.01%.

(e) 

Interest expense, fees and amortization of offering costs related to TOB Trusts and/or RVMTP Shares. See Note 4 and Note 10 of the Notes to Financial Statements for details.

See notes to financial statements.

 

 

I N A N C I A L    I G H L I G H T  S

  45


Financial Highlights (continued)

(For a share outstanding throughout each period)

 

    BNY  
    Year Ended July 31,  
     2021     2020     2019     2018     2017  

Net asset value, beginning of year

  $ 15.09     $ 15.09     $ 14.52     $ 15.04     $ 15.94  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net investment income(a)

    0.66       0.61       0.58       0.60       0.67  

Net realized and unrealized gain (loss)

    0.28       (0.05     0.52       (0.48     (0.85
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net increase (decrease) from investment operations

    0.94       0.56       1.10       0.12       (0.18
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Distributions to Common Shareholders from net investment income(b)

    (0.73     (0.56     (0.53     (0.64     (0.72
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net asset value, end of year

  $ 15.30     $ 15.09     $ 15.09     $ 14.52     $ 15.04  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Market price, end of year

  $ 15.49     $ 14.10     $ 13.81     $ 12.53     $ 15.37  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total Return Applicable to Common Shareholders(c)

         

Based on net asset value

    6.55     4.12     8.33     1.13     (0.93 )% 
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Based on market price

    15.45     6.30     14.88     (14.61 )%      (3.43 )% 
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Ratios to Average Net Assets Applicable to Common Shareholders

         

Total expenses

    1.74 %(d)       2.36     2.73     2.45     2.15
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total expenses after fees waived and/or reimbursed

    1.74 %(d)       2.36     2.73     2.45     2.14
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total expenses after fees waived and/or reimbursed and excluding interest expense, fees, and amortization of offering costs

    1.16 %(d)(e)      1.16 %(f)       1.14 %(f)       1.12 %(f)       1.12 %(f)  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net investment income to Common Shareholders

    4.35     4.06     3.98     4.06     4.45
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Supplemental Data

         

Net assets applicable to Common Shareholders, end of year (000)

  $ 376,645     $ 195,844     $ 195,868     $ 188,452     $ 195,029  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

VRDP Shares outstanding at $100,000 liquidation value, end of year (000)

  $ 179,400     $     $     $     $  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Asset coverage per VRDP Shares at $100,000 liquidation value, end of year

  $ 309,947     $     $     $     $  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

VMTP Shares outstanding at $100,000 liquidation value, end of year (000)

  $     $ 94,500     $ 94,500     $ 94,500     $ 94,500  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Asset coverage per VMTP Shares at $100,000 liquidation value, end of year

  $     $ 307,243     $ 307,268     $ 299,420     $ 306,379  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Borrowings outstanding, end of year (000)

  $ 72,273     $ 42,523     $ 35,517     $ 31,865     $ 32,047  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Portfolio turnover rate

    12     17     23     9     16
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

 

(a) 

Based on average Common Shares outstanding.

(b) 

Distributions for annual periods determined in accordance with U.S. federal income tax regulations.

(c) 

Total returns based on market price, which can be significantly greater or less than the net asset value, may result in substantially different returns. Where applicable, excludes the effects of any sales charges and assumes the reinvestment of distributions at actual reinvestment prices.

(d) 

Includes non-recurring expenses of reorganization costs. Without these costs, total expenses, total expenses after fees waived and/or reimbursed and total expenses after fees waived and/or reimbursed and excluding interest expense, fees, and amortization of offering cost would have been 1.69%, 1.69% and 1.11%, respectively.

(e) 

Interest expense, fees and amortization of offering costs related to TOB Trusts and/or VRDP/VMTP Shares. See Note 4 and Note 10 of the Notes to Financial Statements for details.

(f) 

Interest expense, fees and amortization of offering costs related to TOB Trusts and/or VMTP Shares. See Note 4 and Note 10 of the Notes to Financial Statements for details.

See notes to financial statements.

 

 

46  

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Notes to Financial Statements

 

1.

ORGANIZATION

The following are registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as closed-end management investment companies and are referred to herein collectively as the “Trusts”, or individually as a “Trust”:

 

Trust Name   Herein Referred To As    Organized    Diversification
Classification

BlackRock California Municipal Income Trust

  BFZ    Delaware    Diversified

BlackRock Municipal 2030 Target Term Trust

  BTT    Delaware    Diversified

BlackRock New York Municipal Income Trust

  BNY    Delaware    Diversified

The Boards of Trustees of the Trusts are collectively referred to throughout this report as the “Board,” and the trustees thereof are collectively referred to throughout this report as “Trustees”. The Trusts determine and make available for publication the net asset values (“NAVs”) of their Common Shares on a daily basis.

The Trusts, together with certain other registered investment companies advised by BlackRock Advisors, LLC (the “Manager”) or its affiliates, are included in a complex of non-index fixed-income mutual funds and all BlackRock-advised closed-end funds referred to as the BlackRock Fixed-Income Complex.

Reorganization: The Board and shareholders of BNY (the “Acquiring Trust”) and the Board and shareholders of each of BlackRock New York Municipal Income Quality Trust (“BSE”) and BlackRock New York Municipal Income Trust II (“BFY”) (individually, a “Target Fund” and collectively the “Target Funds”) approved the reorganization of each Target Fund into the Acquiring Trust. As a result, the Acquiring Trust acquired substantially all of the assets and assumed substantially all of the liabilities of each Target Fund in exchange for an equal aggregate value of newly-issued Common Shares and Preferred Shares of the Acquiring Trust.

Each Common Shareholder of a Target Fund received Common Shares of the Acquiring Trust in an amount equal to the aggregate NAV of such Common Shareholder’s Target Fund Common Shares, as determined at the close of business on April 9, 2021, less the costs of the Target Fund’s reorganization. Cash was distributed for any fractional shares.

Each Preferred Shareholder of a Target Fund received Preferred Shares of the Acquiring Trust in an amount equal to the aggregate liquidation preference of the Target Fund’s Preferred Shares held by such Preferred Shareholder prior to the Target Fund’s reorganization.

The reorganizations were accomplished by a tax-free exchange of Common Shares and Preferred Shares of the Acquiring Trust in the following amounts and at the following conversion ratios:

 

Target Funds   Target
Fund’s
Share
Class
     Shares Prior to
Reorganization
     Conversion
Ratio
     BNY’s
Share
Class
     Shares of   
BNY   
 

BSE

    Common        6,519,660        0.99230421        Common        6,469,482(a)  

BFY

    Common        5,004,922        1.03013075        Common        5,155,719(a)  

BSE

    VRDP        405        1        VRDP        405     

BFY

    VRDP        444        1        VRDP        444     

 

  (a)

Net of fractional shares redeemed.

 

Each Target Fund’s net assets and composition of net assets on April 9, 2021, the valuation date of the reorganization were as follows:

 

     BSE      BFY  

Net assets applicable to Common Shareholders

  $ 97,179,129      $ 77,445,122  

Paid-in-capital

    88,938,448        69,414,009  

Accumulated earnings

    8,240,681        8,031,113  

For financial reporting purposes, assets received and shares issued by the Acquiring Trust were recorded at fair value. However, the cost basis of the investments received from the Target Funds were carried forward to align ongoing reporting of the Acquiring Trust’s realized and unrealized gains and losses with amounts distributable to shareholders for tax purposes.

The net assets applicable to Common Shareholders of the Acquiring Trust before the reorganizations were $195,030,274. The aggregate net assets applicable to Common Shareholders of the Acquiring Trust immediately after the reorganizations amounted to $369,654,525. Each Target Fund’s fair value and cost of financial instruments prior to the reorganization were as follows:

 

Target Funds   Fair Value of
Investments
     Cost of
Investments
     TOB Trust
Certificates
     Preferred
Shares Value
 

BSE

  $ 160,831,765      $ 149,307,403      $ 24,950,172      $ 40,500,000  

BFY

    132,426,866        121,683,946        12,569,988        44,400,000  

The purpose of these transactions was to combine three funds managed by the Manager with similar or substantially similar (but not identical) investment objectives and similar investment strategies, policies and restrictions and portfolio compositions. Each reorganization was a tax-free event and was effective on April 12, 2021.

 

 

O T E S    T O    I N A N C I A L     T A T E M E N T S

  47


Notes to Financial Statements  (continued)

 

Assuming the reorganization had been completed on August 1, 2020, the beginning of the fiscal reporting period of the Acquiring Trust, the pro forma results of operations for the year ended July 31, 2021, are as follows:

• Net investment income: $15,926,720

• Net realized and change in unrealized gain/loss on investments: $5,586,398

• Net increase in net assets resulting from operations: $21,513,118

Because the combined investment portfolios have been managed as a single integrated portfolio since the reorganization was completed, it is not practicable to separate the amounts of revenue and earnings of the Target Funds that have been included in the Acquiring Trust’s Statements of Operations since April 12, 2021.

Reorganization costs incurred in connection with the reorganization were expensed by BNY.

 

2.

SIGNIFICANT ACCOUNTING POLICIES

The financial statements are prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”), which may require management to make estimates and assumptions that affect the reported amounts of assets and liabilities in the financial statements, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates. Each Trust is considered an investment company under U.S. GAAP and follows the accounting and reporting guidance applicable to investment companies. Below is a summary of significant accounting policies:

Investment Transactions and Income Recognition: For financial reporting purposes, investment transactions are recorded on the dates the transactions are executed. Realized gains and losses on investment transactions are determined using the specific identification method. Dividend income and capital gain distributions, if any, are recorded on the ex-dividend dates. Non-cash dividends, if any, are recorded on the ex-dividend dates at fair value. Interest income, including amortization and accretion of premiums and discounts on debt securities, is recognized daily on an accrual basis.

Segregation and Collateralization: In cases where a Trust enters into certain investments (e.g., futures contracts) or certain borrowings (e.g., TOB Trust transactions) that would be treated as “senior securities” for 1940 Act purposes, a Trust may segregate or designate on its books and records cash or liquid assets having a market value at least equal to the amount of its future obligations under such investments or borrowings. Doing so allows the investment or borrowings to be excluded from treatment as a “senior security.” Furthermore, if required by an exchange or counterparty agreement, the Trusts may be required to deliver/deposit cash and/or securities to/with an exchange, or broker-dealer or custodian as collateral for certain investments or obligations.

Distributions: Distributions from net investment income are declared monthly and paid monthly. Distributions of capital gains are recorded on the ex-dividend dates and made at least annually. The character and timing of distributions are determined in accordance with U.S. federal income tax regulations, which may differ from U.S. GAAP.

Distributions to Preferred Shareholders are accrued and determined as described in Note 10.

Deferred Compensation Plan: Under the Deferred Compensation Plan (the “Plan”) approved by each Trust’s Board, the trustees who are not “interested persons” of the Trusts, as defined in the 1940 Act (“Independent Trustees”), may defer a portion of their annual complex-wide compensation. Deferred amounts earn an approximate return as though equivalent dollar amounts had been invested in common shares of certain funds in the BlackRock Fixed-Income Complex selected by the Independent Trustees. This has the same economic effect for the Independent Trustees as if the Independent Trustees had invested the deferred amounts directly in certain funds in the BlackRock Fixed-Income Complex.

The Plan is not funded and obligations thereunder represent general unsecured claims against the general assets of each Trust, as applicable. Deferred compensation liabilities, if any, are included in the Trustees’ and Officer’s fees payable in the Statements of Assets and Liabilities and will remain as a liability of the Trusts until such amounts are distributed in accordance with the Plan.

Indemnifications: In the normal course of business, a Trust enters into contracts that contain a variety of representations that provide general indemnification. A Trust’s maximum exposure under these arrangements is unknown because it involves future potential claims against a Trust, which cannot be predicted with any certainty.

Other: Expenses directly related to a Trust are charged to that Trust. Other operating expenses shared by several funds, including other funds managed by the Manager, are prorated among those funds on the basis of relative net assets or other appropriate methods.

 

3.

INVESTMENT VALUATION AND FAIR VALUE MEASUREMENTS

Investment Valuation Policies: Each Trust’s investments are valued at fair value (also referred to as “market value” within the financial statements) each day that the Trust is open for business and, for financial reporting purposes, as of the report date. U.S. GAAP defines fair value as the price a fund would receive to sell an asset or pay to transfer a liability in an orderly transaction between market participants at the measurement date. Each Trust determines the fair values of its financial instruments using various independent dealers or pricing services under policies approved by the Board. If a security’s market price is not readily available or does not otherwise accurately represent the fair value of the security, the security will be valued in accordance with a policy approved by the Board as reflecting fair value. The BlackRock Global Valuation Methodologies Committee (the “Global Valuation Committee”) is the committee formed by management to develop global pricing policies and procedures and to oversee the pricing function for all financial instruments.

 

 

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Notes to Financial Statements  (continued)

 

Fair Value Inputs and Methodologies: The following methods and inputs are used to establish the fair value of each Trust’s assets and liabilities:

 

   

Fixed-income investments for which market quotations are readily available are generally valued using the last available bid price or current market quotations provided by independent dealers or third party pricing services. Pricing services generally value fixed-income securities assuming orderly transactions of an institutional round lot size, but a fund may hold or transact in such securities in smaller, odd lot sizes. Odd lots may trade at lower prices than institutional round lots. The pricing services may use matrix pricing or valuation models that utilize certain inputs and assumptions to derive values, including transaction data (e.g., recent representative bids and offers), market data, credit quality information, perceived market movements, news, and other relevant information. Certain fixed-income securities, including asset-backed and mortgage related securities may be valued based on valuation models that consider the estimated cash flows of each tranche of the entity, establish a benchmark yield and develop an estimated tranche specific spread to the benchmark yield based on the unique attributes of the tranche. The amortized cost method of valuation may be used with respect to debt obligations with sixty days or less remaining to maturity unless the Manager determines such method does not represent fair value.

 

   

Investments in open-end U.S. mutual funds (including money market funds) are valued at that day’s published NAV.

 

   

Futures contracts are valued based on that day’s last reported settlement or trade price on the exchange where the contract is traded.

If events (e.g., market volatility, company announcement or a natural disaster) occur that are expected to materially affect the value of such investment, or in the event that application of these methods of valuation results in a price for an investment that is deemed not to be representative of the market value of such investment, or if a price is not available, the investment will be valued by the Global Valuation Committee, or its delegate, in accordance with a policy approved by the Board as reflecting fair value (“Fair Valued Investments”). The fair valuation approaches that may be used by the Global Valuation Committee include market approach, income approach and cost approach. Valuation techniques such as discounted cash flow, use of market comparables and matrix pricing are types of valuation approaches and are typically used in determining fair value. When determining the price for Fair Valued Investments, the Global Valuation Committee, or its delegate, seeks to determine the price that each Trust might reasonably expect to receive or pay from the current sale or purchase of that asset or liability in an arm’s-length transaction. Fair value determinations shall be based upon all available factors that the Global Valuation Committee, or its delegate, deems relevant and consistent with the principles of fair value measurement. The pricing of all Fair Valued Investments is subsequently reported to the Board or a committee thereof on a quarterly basis.

Fair Value Hierarchy: Various inputs are used in determining the fair value of financial instruments. These inputs to valuation techniques are categorized into a fair value hierarchy consisting of three broad levels for financial reporting purposes as follows:

 

   

Level 1 – Unadjusted price quotations in active markets/exchanges for identical assets or liabilities that each Trust has the ability to access;

 

   

Level 2 – Other observable inputs (including, but not limited to, quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market–corroborated inputs); and

 

   

Level 3 – Unobservable inputs based on the best information available in the circumstances, to the extent observable inputs are not available (including the Global Valuation Committee’s assumptions used in determining the fair value of financial instruments).

The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). Accordingly, the degree of judgment exercised in determining fair value is greatest for instruments categorized in Level 3. The inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the fair value hierarchy classification is determined based on the lowest level input that is significant to the fair value measurement in its entirety. Investments classified within Level 3 have significant unobservable inputs used by the Global Valuation Committee in determining the price for Fair Valued Investments. Level 3 investments include equity or debt issued by privately held companies or funds that may not have a secondary market and/or may have a limited number of investors. The categorization of a value determined for financial instruments is based on the pricing transparency of the financial instruments and is not necessarily an indication of the risks associated with investing in those securities.

 

4.

SECURITIES AND OTHER INVESTMENTS

Zero-Coupon Bonds: Zero-coupon bonds are normally issued at a significant discount from face value and do not provide for periodic interest payments. These bonds may experience greater volatility in market value than other debt obligations of similar maturity which provide for regular interest payments.

Forward Commitments, When-Issued and Delayed Delivery Securities: The Trusts may purchase securities on a when-issued basis and may purchase or sell securities on a forward commitment basis. Settlement of such transactions normally occurs within a month or more after the purchase or sale commitment is made. The Trusts may purchase securities under such conditions with the intention of actually acquiring them, but may enter into a separate agreement to sell the securities before the settlement date. Since the value of securities purchased may fluctuate prior to settlement, the Trusts may be required to pay more at settlement than the security is worth. In addition, a Trust is not entitled to any of the interest earned prior to settlement. When purchasing a security on a delayed delivery basis, the Trusts assume the rights and risks of ownership of the security, including the risk of price and yield fluctuations. In the event of default by the counterparty, the Trusts’ maximum amount of loss is the unrealized appreciation of unsettled when-issued transactions.

Municipal Bonds Transferred to TOB Trusts: Certain Trusts leverage their assets through the use of “TOB Trust” transactions. The funds transfer municipal bonds into a special purpose trust (a “TOB Trust”). A TOB Trust issues two classes of beneficial interests: short-term floating rate interests (“TOB Trust Certificates”), which are sold to third party investors, and residual inverse floating rate interests (“TOB Residuals”), which are issued to the participating funds that contributed the municipal bonds to the TOB Trust. The TOB Trust Certificates have interest rates that reset weekly and their holders have the option to tender such certificates to the TOB Trust for redemption at par and any accrued interest at each reset date. The TOB Residuals held by a fund provide the fund with the right to cause the holders of a proportional share of the TOB Trust Certificates

 

 

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Notes to Financial Statements  (continued)

 

to tender their certificates to the TOB Trust at par plus accrued interest. The funds may withdraw a corresponding share of the municipal bonds from the TOB Trust. Other funds managed by the investment adviser may also contribute municipal bonds to a TOB Trust into which a fund has contributed bonds. If multiple BlackRock-advised funds participate in the same TOB Trust, the economic rights and obligations under the TOB Residuals will be shared among the funds ratably in proportion to their participation in the TOB Trust.

TOB Trusts are supported by a liquidity facility provided by a third party bank or other financial institution (the “Liquidity Provider”) that allows the holders of the TOB Trust Certificates to tender their certificates in exchange for payment of par plus accrued interest on any business day. The tendered TOB Trust Certificates are remarketed by a Remarketing Agent. In the event of a failed remarketing, the TOB Trust may draw upon a loan from the Liquidity Provider to purchase the tendered TOB Trust Certificates. Any loans made by the Liquidity Provider will be secured by the purchased TOB Trust Certificates held by the TOB Trust and will be subject to an increased interest rate based on number of days the loan is outstanding.

The TOB Trust may be collapsed without the consent of a fund, upon the occurrence of a termination event as defined in the TOB Trust agreement. Upon the occurrence of a termination event, a TOB Trust would be liquidated with the proceeds applied first to any accrued fees owed to the trustee of the TOB Trust, the Remarketing Agent and the Liquidity Provider. Upon certain termination events, TOB Trust Certificates holders will be paid before the TOB Residuals holders (i.e., the Trusts) whereas in other termination events, TOB Trust Certificates holders and TOB Residuals holders will be paid pro rata.

While a fund’s investment policies and restrictions expressly permit investments in inverse floating rate securities, such as TOB Residuals, they restrict the ability of a fund to borrow money for purposes of making investments. Each fund’s transfer of the municipal bonds to a TOB Trust is considered a secured borrowing for financial reporting purposes. The cash received by the TOB Trust from the sale of the TOB Trust Certificates, less certain transaction expenses, is paid to a fund. A fund typically invests the cash received in additional municipal bonds.

Accounting for TOB Trusts: The municipal bonds deposited into a TOB Trust are presented in a fund’s Schedule of Investments and the TOB Trust Certificates are shown in Other Liabilities in the Statements of Assets and Liabilities. Any loans drawn by the TOB Trust pursuant to the liquidity facility to purchase tendered TOB Trust Certificates are shown as Loan for TOB Trust Certificates. The carrying amount of a fund’s payable to the holder of the TOB Trust Certificates, as reported in the Statements of Assets and Liabilities as TOB Trust Certificates, approximates its fair value.

Interest income, including amortization and accretion of premiums and discounts, from the underlying municipal bonds is recorded by a fund on an accrual basis. Interest expense incurred on the TOB Trust transaction and other expenses related to remarketing, administration, trustee, liquidity and other services to a TOB Trust are shown as interest expense, fees and amortization of offering costs in the Statements of Operations. Fees paid upon creation of the TOB Trust are recorded as debt issuance costs and are amortized to interest expense, fees and amortization of offering costs in the Statements of Operations to the expected maturity of the TOB Trust. In connection with the restructurings of the TOB Trusts to non-bank sponsored TOB Trusts, a fund incurred non-recurring, legal and restructuring fees, which are recorded as interest expense, fees and amortization of offering costs in the Statements of Operations. Amounts recorded within interest expense, fees and amortization of offering costs in the Statements of Operations are:

 

Trust Name   Interest Expense      Liquidity Fees      Other Expenses      Total  

BFZ

  $ 157,632      $ 642,517      $ 191,932      $ 992,081  

BTT

    319,754        786,946        634,503        1,741,203  

BNY

    66,249        222,704        77,576        366,529  

For the year ended July 31, 2021, the following table is a summary of each Trust’s TOB Trusts:

 

Trust Name   Underlying
Municipal Bonds
Transferred to
TOB Trusts(a)
    

Liability for

TOB Trust
Certificates(b)

    

Range of

Interest Rates
on TOB Trust
Certificates at
Period End

  

Average

TOB Trust
Certificates
Outstanding

     Daily Weighted   
Average Rate   
of Interest and   
Other Expenses   
on TOB Trusts   
 

BFZ

  $ 337,302,439      $ 143,275,836      0.04% — 0.12%    $ 143,061,221        0.69%  

BTT

    415,303,322        233,219,979      0.05    — 0.31         239,700,935        0.72     

BNY

    131,603,180        72,273,255      0.04    — 0.12         53,921,570        0.68     

 

  (a) 

The municipal bonds transferred to a TOB Trust are generally high grade municipal bonds. In certain cases, when municipal bonds transferred are lower grade municipal bonds, the TOB Trust transaction may include a credit enhancement feature that provides for the timely payment of principal and interest on the bonds to the TOB Trust by a credit enhancement provider in the event of default of the municipal bond. The TOB Trust would be responsible for the payment of the credit enhancement fee and the funds, as TOB Residuals holders, would be responsible for reimbursement of any payments of principal and interest made by the credit enhancement provider. The maximum potential amounts owed by the funds, for such reimbursements, as applicable, are included in the maximum potential amounts disclosed for recourse TOB Trusts in the Schedules of Investments.

 
  (b) 

TOB Trusts may be structured on a non-recourse or recourse basis. When a Trust invests in TOB Trusts on a non-recourse basis, the Liquidity Provider may be required to make a payment under the liquidity facility to allow the TOB Trust to repurchase TOB Trust Certificates. The Liquidity Provider will be reimbursed from the liquidation of bonds held in the TOB Trust. If a fund invests in a TOB Trust on a recourse basis, a fund enters into a reimbursement agreement with the Liquidity Provider where a fund is required to reimburse the Liquidity Provider for any shortfall between the amount paid by the Liquidity Provider and proceeds received from liquidation of municipal bonds held in the TOB Trust (the “Liquidation Shortfall”). As a result, if a fund invests in a recourse TOB Trust, a fund will bear the risk of loss with respect to any Liquidation Shortfall. If multiple funds participate in any such TOB Trust, these losses will be shared ratably, including the maximum potential amounts owed by a fund at July 31, 2021, in proportion to their participation in the TOB Trust. The recourse TOB Trusts are identified in the Schedules of Investments including the maximum potential amounts owed by a fund at July 31, 2021.

 

 

 

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Notes to Financial Statements  (continued)

 

For the year ended July 31, 2021, the following table is a summary of each Trust’s Loan for TOB Trust Certificates:

 

Trust Name   Loans
Outstanding
at Period End
     Range of
Interest Rates
on Loans at
Period End
    Average
Loans
Outstanding
     Daily Weighted   
Average Rate   
of Interest and   
Other Expenses   
on Loans   
 

BFZ

  $          $ 214,615        0.66%  

BTT

                 55,890        0.69     

BNY

                 19,333        0.71     

 

5.

DERIVATIVE FINANCIAL INSTRUMENTS

The Trusts engage in various portfolio investment strategies using derivative contracts both to increase the returns of the Trusts and/or to manage their exposure to certain risks such as credit risk, equity risk, interest rate risk, foreign currency exchange rate risk, commodity price risk or other risks (e.g., inflation risk). Derivative financial instruments categorized by risk exposure are included in the Schedules of Investments. These contracts may be transacted on an exchange or over-the-counter (“OTC”).

Futures Contracts: Futures contracts are purchased or sold to gain exposure to, or manage exposure to, changes in interest rates (interest rate risk) and changes in the value of equity securities (equity risk) or foreign currencies (foreign currency exchange rate risk).

Futures contracts are exchange-traded agreements between the Trusts and a counterparty to buy or sell a specific quantity of an underlying instrument at a specified price and on a specified date. Depending on the terms of a contract, it is settled either through physical delivery of the underlying instrument on the settlement date or by payment of a cash amount on the settlement date. Upon entering into a futures contract, the Trusts are required to deposit initial margin with the broker in the form of cash or securities in an amount that varies depending on a contract’s size and risk profile. The initial margin deposit must then be maintained at an established level over the life of the contract. Amounts pledged, which are considered restricted, are included in cash pledged for futures contracts in the Statements of Assets and Liabilities.

Securities deposited as initial margin are designated in the Schedules of Investments and cash deposited, if any, are shown as cash pledged for futures contracts in the Statements of Assets and Liabilities. Pursuant to the contract, the Trusts agree to receive from or pay to the broker an amount of cash equal to the daily fluctuation in market value of the contract (“variation margin”). Variation margin is recorded as unrealized appreciation (depreciation) and, if any, shown as variation margin receivable (or payable) on futures contracts in the Statements of Assets and Liabilities. When the contract is closed, a realized gain or loss is recorded in the Statements of Operations equal to the difference between the notional amount of the contract at the time it was opened and the notional amount at the time it was closed. The use of futures contracts involves the risk of an imperfect correlation in the movements in the price of futures contracts and interest rates, foreign currency exchange rates or underlying assets.

 

6.

INVESTMENT ADVISORY AGREEMENT AND OTHER TRANSACTIONS WITH AFFILIATES

Investment Advisory: Each Trust entered into an Investment Advisory Agreement with the Manager, the Trusts’ investment adviser and an indirect, wholly-owned subsidiary of BlackRock, Inc. (“BlackRock”), to provide investment advisory and administrative services. The Manager is responsible for the management of each Trust’s portfolio and provides the personnel, facilities, equipment and certain other services necessary to the operations of each Trust.

For such services, each Trust, except BTT, pays the Manager a monthly fee at an annual rate equal to the following percentages of the average weekly value of each Trust’s managed assets:

 

     BFZ     BNY     

Investment advisory fees

    0.58     0.55%  

Prior to April 12, 2021 the annual rate as a percentage of average weekly managed assets, for BNY was 0.60%.

For such services, BTT pays the Manager a monthly fee at an annual rate equal to 0.40% of the average daily value of the Trust’s managed assets.

For purposes of calculating these fees, for each Trust except for BTT, “managed assets” are determined as total assets of the Trust (including any assets attributable to money borrowed for investment purposes) less the sum of its accrued liabilities (other than money borrowed for investment purposes).

Expense Waivers and Reimbursements: With respect to each Trust, the Manager contractually agreed to waive its investment advisory fees by the amount of investment advisory fees each Trust pays to the Manager indirectly through its investment in affiliated money market funds (the “affiliated money market fund waiver”) through June 30, 2023. The contractual agreement may be terminated upon 90 days’ notice by a majority of the Independent Trustees, or by a vote of a majority of the outstanding voting securities of a Trust. These amounts are included in fees waived and/or reimbursed by the Manager in the Statements of Operations. For the year ended July 31, 2021, the amounts waived were as follows:

 

Trust Name   Fees Waived and/or Reimbursed
by the Manager
 

BFZ

  $ 380  

BTT

    36,822  

BNY

    119  

 

 

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Notes to Financial Statements  (continued)

 

The Manager has contractually agreed to waive its investment advisory fee with respect to any portion of each Trust’s assets invested in affiliated equity and fixed-income mutual funds and affiliated exchange-traded funds that have a contractual management fee through June 30, 2023. The agreement can be renewed for annual periods thereafter, and may be terminated on 90 days’ notice, each subject to approval by a majority of the Trusts’ Independent Trustees. For the year ended July 31, 2021, there were no fees waived by the Manager pursuant to this arrangement.

Trustees and Officers: Certain trustees and/or officers of the Trusts are directors and/or officers of BlackRock or its affiliates. The Trusts reimburse the Manager for a portion of the compensation paid to the Trusts’ Chief Compliance Officer, which is included in Trustees and Officer in the Statements of Operations.

 

7.

PURCHASES AND SALES

For the year ended July 31, 2021, purchases and sales of investments, excluding short-term investments, were as follows:

 

Trust Name   Purchases      Sales  

BFZ

  $ 163,585,900      $ 155,295,347  

BTT

    270,147,163        262,291,066  

BNY

    49,842,344        62,762,105  

 

8.

INCOME TAX INFORMATION

It is each Trust’s policy to comply with the requirements of the Internal Revenue Code of 1986, as amended, applicable to regulated investment companies, and to distribute substantially all of its taxable income to its shareholders. Therefore, no U.S. federal income tax provision is required.

Each Trust files U.S. federal and various state and local tax returns. No income tax returns are currently under examination. The statute of limitations on each Trust’s U.S. federal tax returns generally remains open for a period of three fiscal years after they are filed. The statutes of limitations on each Trust’s state and local tax returns may remain open for an additional year depending upon the jurisdiction.

Management has analyzed tax laws and regulations and their application to the Trusts as of July 31, 2021, inclusive of the open tax return years, and does not believe that there are any uncertain tax positions that require recognition of a tax liability in the Trusts’ financial statements.

U.S. GAAP requires that certain components of net assets be adjusted to reflect permanent differences between financial and tax reporting. These reclassifications have no effect on net assets or NAVs per share. As of period end, the following permanent differences attributable to non-deductible expenses, the retention of tax-exempt income and amortization methods on fixed income securities were reclassified to the following accounts:

 

Trust Name   Paid-in Capital     Accumulated
Earnings (Loss)
 

BTT

  $ 4,901,729     $ (4,901,729

BNY

    (32,842     32,842  

The tax character of distributions paid was as follows:

 

Trust Name   Year Ended
07/31/21
       Year Ended
07/31/20
 

BFZ

      

Tax-exempt income(a)

    $ 16,494,298          $ 18,057,200  

Ordinary income(b)

    3,856          7,156  
 

 

 

      

 

 

 
    $16,498,154          $18,064,356  
 

 

 

      

 

 

 

BTT

      

Tax-exempt income(a)

    $ 57,798,658          64,371,539  

Ordinary income(b)

    5,855           
 

 

 

      

 

 

 
    $57,804,513          $64,371,539  
 

 

 

      

 

 

 

BNY

      

Tax-exempt income(a)

    $ 12,468,851          9,009,448  

Ordinary income(b)

    1,797          4,630  
 

 

 

      

 

 

 
    $12,470,648          $9,014,078  
 

 

 

      

 

 

 

 

  (a) 

The Trusts designate these amounts paid during the fiscal year ended July 31, 2021, as exempt-interest dividends.

 
  (b) 

Ordinary income consists primarily of taxable income recognized from market discount. Additionally, all ordinary income distributions are comprised of interest related dividends for non-US residents and are eligible for exemption from US withholding tax for nonresident aliens and foreign corporations.

 

 

 

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Notes to Financial Statements  (continued)

 

As of period end, the tax components of accumulated earnings (loss) were as follows:

 

           
Trust Name   Undistributed
Tax-Exempt Income
     Undistributed
Ordinary Income
     Non-Expiring
Capital Loss
Carryforwards(a)
    Net Unrealized
Gains (Losses)(b)
     Total  

BFZ

  $ 1,392,127      $      $  (1,192,776   $ 70,776,958      $ 70,976,309  

BTT

    19,421,121               (18,290,957     244,338,788        245,468,952  

BNY

    590,985        2,269        (14,286,943     53,669,514        39,975,825  

 

  (a) 

Subject to limitation, amounts available to offset future realized capital gains.

 

 

  (b) 

The difference between book-basis and tax-basis net unrealized gains were attributable primarily to the tax deferral of losses on wash sales, amortization and accretion methods of premiums and discounts on fixed income securities, the realization for tax purposes of unrealized gains/(losses) on certain futures contracts, the treatment of residual interests in tender option bond trusts and the deferral of compensation to Trustees.

 

During the year ended July 31, 2021, the Trusts listed below utilized the following amounts of their respective capital loss carryforward:

 

Trust Name

 

Amounts

 

BFZ

  $  4,350,444  

BTT

    5,482,772  

As of July 31, 2021, gross unrealized appreciation and depreciation based on cost of investments (including short positions and derivatives, if any) for U.S. federal income tax purposes were as follows:

 

         
Trust Name   Tax Cost      Gross Unrealized
Appreciation
     Gross Unrealized
Depreciation
    Net Unrealized
Appreciation
(Depreciation)
 

BFZ

  $ 604,485,243      $ 70,973,300      $ (92,136   $ 70,881,164  

BTT

    2,415,781,424        245,353,091        (1,014,303     244,338,788  

BNY

    497,585,596        54,298,832        (556,164     53,742,668  

 

9.

PRINCIPAL RISKS

In the normal course of business, the Trusts invest in securities or other instruments and may enter into certain transactions, and such activities subject each Trust to various risks, including among others, fluctuations in the market (market risk) or failure of an issuer to meet all of its obligations. The value of securities or other instruments may also be affected by various factors, including, without limitation: (i) the general economy; (ii) the overall market as well as local, regional or global political and/or social instability; (iii) regulation, taxation or international tax treaties between various countries; or (iv) currency, interest rate and price fluctuations. Local, regional or global events such as war, acts of terrorism, the spread of infectious illness or other public health issues, recessions, or other events could have a significant impact on the Trusts and their investments.

The Trusts may hold a significant amount of bonds subject to calls by the issuers at defined dates and prices. When bonds are called by issuers and the Trusts reinvest the proceeds received, such investments may be in securities with lower yields than the bonds originally held, and correspondingly, could adversely impact the yield and total return performance of a Trust.

A Trust structures and “sponsors” the TOB Trusts in which it holds TOB Residuals and has certain duties and responsibilities, which may give rise to certain additional risks including, but not limited to, compliance, securities law and operational risks.

Should short-term interest rates rise, the Trusts’ investments in the TOB Trusts may adversely affect the Trusts’ net investment income and dividends to Common Shareholders. Also, fluctuations in the market value of municipal bonds deposited into the TOB Trust may adversely affect the Trusts’ NAVs per share.

The U.S. Securities and Exchange Commission (“SEC”) and various federal banking and housing agencies have adopted credit risk retention rules for securitizations (the “Risk Retention Rules”). The Risk Retention Rules would require the sponsor of a TOB Trust to retain at least 5% of the credit risk of the underlying assets supporting the TOB Trust’s municipal bonds. The Risk Retention Rules may adversely affect the Trusts’ ability to engage in TOB Trust transactions or increase the costs of such transactions in certain circumstances.

TOB Trusts constitute an important component of the municipal bond market. Any modifications or changes to rules governing TOB Trusts may adversely impact the municipal market and the Trusts, including through reduced demand for and liquidity of municipal bonds and increased financing costs for municipal issuers. The ultimate impact of any potential modifications on the TOB Trust market and the overall municipal market is not yet certain.

Each Trust may invest without limitation in illiquid or less liquid investments or investments in which no secondary market is readily available or which are otherwise illiquid, including private placement securities. A Trust may not be able to readily dispose of such investments at prices that approximate those at which a Trust could sell such investments if they were more widely traded and, as a result of such illiquidity, a Trust may have to sell other investments or engage in borrowing transactions if necessary to raise funds to meet its obligations. Limited liquidity can also affect the market price of investments, thereby adversely affecting a Trust’s NAV and ability to make dividend distributions. Privately issued debt securities are often of below investment grade quality, frequently are unrated and present many of the same risks as investing in below investment grade public debt securities.

Market Risk: Each Trust may be exposed to prepayment risk, which is the risk that borrowers may exercise their option to prepay principal earlier than scheduled during periods of declining interest rates, which would force each Trust to reinvest in lower yielding securities. Each Trust may also be exposed to reinvestment risk, which is the risk

 

 

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Notes to Financial Statements  (continued)

 

that income from each Trust’s portfolio will decline if each Trust invests the proceeds from matured, traded or called fixed-income securities at market interest rates that are below each Trust portfolio’s current earnings rate.

Municipal securities are subject to the risk that litigation, legislation or other political events, local business or economic conditions, credit rating downgrades, or the bankruptcy of the issuer could have a significant effect on an issuer’s ability to make payments of principal and/or interest or otherwise affect the value of such securities. Municipal securities can be significantly affected by political or economic changes, including changes made in the law after issuance of the securities, as well as uncertainties in the municipal market related to, taxation, legislative changes or the rights of municipal security holders, including in connection with an issuer insolvency. Municipal securities backed by current or anticipated revenues from a specific project or specific assets can be negatively affected by the discontinuance of the tax benefits supporting the project or assets or the inability to collect revenues for the project or from the assets. Municipal securities may be less liquid than taxable bonds, and there may be less publicly available information on the financial condition of municipal security issuers than for issuers of other securities.

An outbreak of respiratory disease caused by a novel coronavirus has developed into a global pandemic and has resulted in closing borders, quarantines, disruptions to supply chains and customer activity, as well as general concern and uncertainty. The impact of this pandemic, and other global health crises that may arise in the future, could affect the economies of many nations, individual companies and the market in general in ways that cannot necessarily be foreseen at the present time. This pandemic may result in substantial market volatility and may adversely impact the prices and liquidity of a fund’s investments. The duration of this pandemic and its effects cannot be determined with certainty.

Investment Objective Risk: There is no assurance that BTT will achieve its investment objectives, including its investment objective of returning $25.00 per share. As BTT approaches its scheduled termination date, it is expected that the maturity of BTT’s portfolio securities will shorten, which is likely to reduce BTT’s income and distributions to shareholders.

Counterparty Credit Risk: The Trusts may be exposed to counterparty credit risk, or the risk that an entity may fail to or be unable to perform on its commitments related to unsettled or open transactions, including making timely interest and/or principal payments or otherwise honoring its obligations. The Trusts manage counterparty credit risk by entering into transactions only with counterparties that the Manager believes have the financial resources to honor their obligations and by monitoring the financial stability of those counterparties. Financial assets, which potentially expose the Trusts to market, issuer and counterparty credit risks, consist principally of financial instruments and receivables due from counterparties. The extent of the Trusts’ exposure to market, issuer and counterparty credit risks with respect to these financial assets is approximately their value recorded in the Statements of Assets and Liabilities, less any collateral held by the Trusts.

A derivative contract may suffer a mark-to-market loss if the value of the contract decreases due to an unfavorable change in the market rates or values of the underlying instrument. Losses can also occur if the counterparty does not perform under the contract.

With exchange-traded futures, there is less counterparty credit risk to the Trusts since the exchange or clearinghouse, as counterparty to such instruments, guarantees against a possible default. The clearinghouse stands between the buyer and the seller of the contract; therefore, credit risk is limited to failure of the clearinghouse. While offset rights may exist under applicable law, a Trust does not have a contractual right of offset against a clearing broker or clearinghouse in the event of a default (including the bankruptcy or insolvency). Additionally, credit risk exists in exchange-traded futures with respect to initial and variation margin that is held in a clearing broker’s customer accounts. While clearing brokers are required to segregate customer margin from their own assets, in the event that a clearing broker becomes insolvent or goes into bankruptcy and at that time there is a shortfall in the aggregate amount of margin held by the clearing broker for all its clients, typically the shortfall would be allocated on a pro rata basis across all the clearing broker’s customers, potentially resulting in losses to the Trusts.

Concentration Risk: A diversified portfolio, where this is appropriate and consistent with a fund’s objectives, minimizes the risk that a price change of a particular investment will have a material impact on the NAV of a fund. The investment concentrations within each Trust’s portfolio are disclosed in its Schedule of Investments.

Certain Trusts invest a substantial amount of their assets in issuers located in a single state or limited number of states. When a Trust concentrates its investments in this manner, it assumes the risk that economic, regulatory, political or social conditions affecting that state or group of states could have a significant impact on the fund and could affect the income from, or the value or liquidity of, the fund’s portfolio. Investment percentages in specific states or U.S. territories are presented in the Schedules of Investments.

Certain Trusts invest a significant portion of their assets in securities within a single or limited number of market sectors. When a Trust concentrates its investments in this manner, it assumes the risk that economic, regulatory, political and social conditions affecting such sectors may have a significant impact on the Trust and could affect the income from, or the value or liquidity of, the Trust’s portfolio. Investment percentages in specific sectors are presented in the Schedules of Investments.

Certain Trusts invest a significant portion of their assets in fixed-income securities and/or use derivatives tied to the fixed-income markets. Changes in market interest rates or economic conditions may affect the value and/or liquidity of such investments. Interest rate risk is the risk that prices of bonds and other fixed-income securities will increase as interest rates fall and decrease as interest rates rise. The Trusts may be subject to a greater risk of rising interest rates due to the current period of historically low rates.

LIBOR Transition Risk: The United Kingdom’s Financial Conduct Authority announced a phase out of the London Interbank Offered Rate (“LIBOR”). Although many LIBOR rates will be phased out by the end of 2021, a selection of widely used USD LIBOR rates will continue to be published through June 2023 in order to assist with the transition. The Trusts may be exposed to financial instruments tied to LIBOR to determine payment obligations, financing terms, hedging strategies or investment value. The transition process away from LIBOR might lead to increased volatility and illiquidity in markets for, and reduce the effectiveness of new hedges placed against, instruments whose terms currently include LIBOR. The ultimate effect of the LIBOR transition process on the Trusts is uncertain.

 

 

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Notes to Financial Statements  (continued)

 

10.

CAPITAL SHARE TRANSACTIONS

Each Trust is authorized to issue an unlimited number of shares, all of which were initially classified as Common Shares. The par value for each Trust’s Common Shares is $0.001. The par value for each Trust’s Preferred Shares outstanding is $0.001. Each Board is authorized, however, to reclassify any unissued Common Shares to Preferred Shares without the approval of Common Shareholders.

Common Shares

For the years shown, shares issued and outstanding increased by the following amounts as a result of dividend reinvestment:

 

    

Year Ended

 

Trust Name

 

07/31/21

    

07/31/20

 

BNY

    13,107         

For the year ended July 31, 2021 and the year ended July 31, 2020, shares issued and outstanding remained constant for BTT.

For the year ended July 31, 2021, Common Shares issued and outstanding increased by 11,625,210 as a result of the reorganization of BNY.

For the year ended July 31, 2021, Common Shares issued and outstanding decreased by 9 as a result of a redemption of fractional shares from the reorganization of BNY.

BFZ and BNY participate in an open market share repurchase program (the “Repurchase Program”). From December 1, 2019 through November 30, 2020, each of BFZ and BNY may repurchase up to 5% of its outstanding common shares under the Repurchase Program, based on common shares outstanding as of the close of business on November 30, 2019, subject to certain conditions. From December 1, 2020 through November 30, 2021, each of BFZ and BNY may repurchase up to 5% of its outstanding common shares under the Repurchase Program, based on common shares outstanding as of the close of business on November 30, 2020, subject to certain conditions. There is no assurance that the Trusts will purchase shares in any particular amounts. For the year ended July 31, 2021, BNY did not repurchase any shares.

The total cost of the shares repurchased is reflected in BFZ’s Statements of Changes in Net Assets. For the periods shown, shares repurchased and cost, including transaction costs were as follows:

 

    

BFZ

 
    

Shares

    

Amounts

 

Year Ended July 31, 2021

    209,100      $  2,813,059  

Year Ended July 31, 2020

    352,102        4,493,469  

Preferred Shares

A Trust’s Preferred Shares rank prior to its Common Shares as to the payment of dividends by the Trust and distribution of assets upon dissolution or liquidation of the Trust. The 1940 Act prohibits the declaration of any dividend on Common Shares or the repurchase of Common Shares if the Trust fails to maintain asset coverage of at least 200% of the liquidation preference of the Trust’s outstanding Preferred Shares. In addition, pursuant to the Preferred Shares’ governing instruments, a Trust is restricted from declaring and paying dividends on classes of shares ranking junior to or on parity with its Preferred Shares or repurchasing such shares if the Trust fails to declare and pay dividends on the Preferred Shares, redeem any Preferred Shares required to be redeemed under the Preferred Shares’ governing instruments or comply with the basic maintenance amount requirement of the ratings agencies rating the Preferred Shares.

Holders of Preferred Shares have voting rights equal to the voting rights of holders of Common Shares (one vote per share) and vote together with holders of Common Shares (one vote per share) as a single class on certain matters. Holders of Preferred Shares, voting as a separate class, are also entitled to (i) elect two members of the Board, (ii) elect the full Board if dividends on the Preferred Shares are not paid for a period of two years and (iii) a separate class vote to amend the Preferred Share governing documents. In addition, the 1940 Act requires the approval of the holders of a majority of any outstanding Preferred Shares, voting as a separate class, to (a) adopt any plan of reorganization that would adversely affect the Preferred Shares, (b) change a Trust’s sub-classification as a closed-end investment company or change its fundamental investment restrictions or (c) change its business so as to cease to be an investment company.

VRDP Shares

BNY (for purposes of this section, a “VRDP Trust”) has issued Series W-7 VRDP Shares, $100,000 liquidation preference per share, in one or more privately negotiated offerings to qualified institutional buyers as defined pursuant to Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”). The VRDP Shares include a liquidity feature and may be subject to a special rate period. As of period end, the VRDP Shares outstanding were as follows:

 

         
Trust Name   Issue
Date
     Shares
Issued
     Aggregate
Principal
     Maturity
Date
 

BNY

    03/31/21        945      $  94,500,000        03/31/51  
      04/12/21        849        84,900,000        03/31/51  

Redemption Terms: A VRDP Trust is required to redeem its VRDP Shares on the maturity date, unless earlier redeemed or repurchased. Six months prior to the maturity date, a VRDP Trust is required to begin to segregate liquid assets with the Trust’s custodian to fund the redemption. In addition, a VRDP Trust is required to redeem certain of its outstanding VRDP Shares if it fails to comply with certain asset coverage, basic maintenance amount or leverage requirements.

 

 

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Notes to Financial Statements  (continued)

 

Subject to certain conditions, the VRDP Shares may also be redeemed, in whole or in part, at any time at the option of a VRDP Trust. The redemption price per VRDP Share is equal to the liquidation preference per share plus any outstanding unpaid dividends.

Liquidity Feature: VRDP Shares are subject to a fee agreement between the VRDP Trust and the liquidity provider that requires a per annum liquidity fee and, in some cases, an upfront or initial commitment fee, payable to the liquidity provider. These fees, if applicable, are shown as liquidity fees in the Statements of Operations. As of period end, the fee agreement is set to expire, unless renewed or terminated in advance, as follows:

 

    

BNY

 

Expiration date

    04/30/22  

The VRDP Shares are also subject to a purchase agreement in connection with the liquidity feature. In the event a purchase agreement is not renewed or is terminated in advance, and the VRDP Shares do not become subject to a purchase agreement with an alternate liquidity provider, the VRDP Shares will be subject to mandatory purchase by the liquidity provider prior to the termination of the purchase agreement. In the event of such mandatory purchase, a VRDP Trust is required to redeem the VRDP Shares six months after the purchase date. Immediately after such mandatory purchase, the VRDP Trust is required to begin to segregate liquid assets with its custodian to fund the redemption. There is no assurance that a VRDP Trust will replace such redeemed VRDP Shares with any other preferred shares or other form of leverage.

Remarketing: A VRDP Trust may incur remarketing fees on the aggregate principal amount of all its VRDP Shares, which, if any, are included in remarketing fees on Preferred Shares in the Statements of Operations. During any special rate period (as described below), a VRDP Trust may incur nominal or no remarketing fees.

Ratings: As of period end, the VRDP Shares were assigned the following ratings:

 

     
Trust Name   Moody’s Investors
Service, Inc.
Long-Term
Ratings
     Fitch Ratings, Inc.
Long-Term
Ratings
 

BNY

    Aa2        AA  

Special Rate Period: A VRDP Trust has commenced a “special rate period” with respect to its VRDP Shares, during which the VRDP Shares will not be subject to any remarketing and the dividend rate will be based on a predetermined methodology. During a special rate period, short-term ratings on VRDP Shares are withdrawn. BNY’s special rate period has commenced on March 31, 2021 and has a current expiration date of April 15, 2022.

Prior to the expiration date, the VRDP Trust and the VRDP Shares holder may mutually agree to extend the special rate period. If a special rate period is not extended, the VRDP Shares will revert to remarketable securities upon the termination of the special rate period and will be remarketed and available for purchase by qualified institutional investors.

During the special rate period: (i) the liquidity and fee agreements remain in effect, (ii) VRDP Shares remain subject to mandatory redemption by the VRDP Trust on the maturity date, (iii) VRDP Shares will not be remarketed or subject to optional or mandatory tender events, (iv) the VRDP Trust is required to comply with the same asset coverage, basic maintenance amount and leverage requirements for the VRDP Shares as is required when the VRDP Shares are not in a special rate period, (v) the VRDP Trust will pay dividends monthly based on the sum of an agreed upon reference rate and a percentage per annum based on the long-term ratings assigned to the VRDP Shares and (vi) the VRDP Trust will pay nominal or no fees to the liquidity provider and remarketing agent.

Dividends: Except during the Special Rate Period as described above, dividends on the VRDP Shares are payable monthly at a variable rate set weekly by the remarketing agent. Such dividend rates are generally based upon a spread over a base rate and cannot exceed a maximum rate. A change in the short-term credit rating of the liquidity provider or the VRDP Shares may adversely affect the dividend rate paid on such shares, although the dividend rate paid on the VRDP Shares is not directly based upon either short-term rating. In the event of a failed remarketing, the dividend rate of the VRDP Shares will be reset to a maximum rate. The maximum rate is determined based on, among other things, the long-term preferred share rating assigned to the VRDP Shares and the length of time that the VRDP Shares fail to be remarketed.

For the year ended July 31, 2021, the annualized dividend rate for the VRDP Shares was 0.89%.

During the year ended July 31, 2021, issued and outstanding VRDP Shares for BNY increased by 945 from the exchange of VMTP Shares and 849 due to the reorganizations of BSE and BFY with and into BNY.

VMTP Shares

BFZ (for purposes of this section, a “VMTP Trust”) has issued Series W-7 VMTP Shares, $100,000 liquidation preference per share, in one or more privately negotiated offerings to qualified institutional buyers as defined pursuant to Rule 144A under the Securities Act. The VMTP Shares are subject to certain restrictions on transfer, and a VMTP Trust may also be required to register its VMTP Shares for sale under the Securities Act under certain circumstances. As of period end, the VMTP Shares outstanding and assigned long-term ratings were as follows:

 

             
Trust Name   Issue
Date
     Shares
Issued
     Aggregate
Principal
     Term
Redemption
Date
     Moody’s
Rating
     Fitch
Rating
 

BFZ

    03/22/12        1,713      $  171,300,000        03/30/22        Aa2        AA  

 

 

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Notes to Financial Statements  (continued)

 

Redemption Terms: A VMTP Trust is required to redeem its VMTP Shares on the term redemption date, unless earlier redeemed or repurchased or unless extended. There is no assurance that a term will be extended further or that any VMTP Shares will be replaced with any other preferred shares or other form of leverage upon the redemption or repurchase of the VMTP Shares. Six months prior to the term redemption date, a VMTP Trust is required to begin to segregate liquid assets with its custodian to fund the redemption. In addition, a VMTP Trust is required to redeem certain of its outstanding VMTP Shares if it fails to comply with certain asset coverage, basic maintenance amount or leverage requirements.

Subject to certain conditions, VMTP Shares may be redeemed, in whole or in part, at any time at the option of the VMTP Trust. The redemption price per VMTP Share is equal to the liquidation preference per share plus any outstanding unpaid dividends.

Dividends: Dividends on the VMTP Shares are declared daily and payable monthly at a variable rate set weekly at a fixed rate spread to the Securities Industry and Financial Markets Association (“SIFMA”) Municipal Swap Index or to a percentage of the one-month LIBOR rate, as set forth in the VMTP Shares governing instrument. The fixed spread is determined based on the long-term preferred share rating assigned to the VMTP Shares by the ratings agencies then rating the VMTP Shares.

The dividend rate on VMTP Shares is subject to a step-up spread if the VMTP Trust fails to comply with certain provisions, including, among other things, the timely payment of dividends, redemptions or gross-up payments, and complying with certain asset coverage and leverage requirements.

For the year ended July 31, 2021, the average annualized dividend rate for the VMTP Shares was 0.82%.

During the year ended July 31, 2021, all issued and outstanding VMTP Shares of BFZ remained constant and all 945 issued and outstanding VMTP Shares of BNY were redeemed in full in exchange for VRDP Shares.

RVMTP Shares

BTT has issued Series W-7 RVMTP Shares, $5,000,000 liquidation preference per share, in privately negotiated offerings to qualified institutional buyers as defined pursuant to Rule 144A under the Securities Act. The RVMTP Shares are subject to certain restrictions on transfer outside of a remarketing. As of period end, the RVMTP Shares outstanding of BTT were as follows:

 

           
Trust Name   Issue
Date
     Shares
Issued
     Shares
Outstanding
     Aggregate
Principal
     Term
Redemption
Date
 

BTT

    01/10/13        50        50      $  250,000,000        12/31/30  
    01/30/13        50        50        250,000,000        12/31/30  
      02/20/13        50        50        250,000,000        12/31/30  

Redemption Terms: BTT is required to redeem its RVMTP Shares on the term redemption date or within six months of an unsuccessful remarketing, unless earlier redeemed or repurchased. There is no assurance that RVMTP Shares will be replaced with any other preferred shares or other form of leverage upon the redemption or repurchase of the RVMTP Shares. In addition, BTT is required to redeem certain of its outstanding RVMTP Shares if it fails to comply with certain asset coverage, basic maintenance amount or leverage requirements.

Subject to certain conditions, RVMTP Shares may be redeemed, in whole or in part, at any time at the option of BTT. The redemption price per RVMTP Share is equal to the liquidation preference per share plus any outstanding unpaid dividends. The RVMTP Shares are subject to certain restrictions on transfer outside of a remarketing. The RVMTP Shares are subject to remarketing upon 90 days’ notice by holders of the RVMTP Shares and 30 days’ notice by BTT. Each remarketing must be at least six months apart from the last remarketing. A holder of RVMTP Shares may submit notice of remarketing only if such holder requests a remarketing of at least the lesser of (i) $100,000,000 of RVMTP Shares or (ii) all of the RVMTP Shares held by such holder.

Dividends: Dividends on the RVMTP Shares are declared daily and payable monthly at a variable rate set weekly at a fixed rate spread to a percentage of the one-month LIBOR rate. The fixed rate spread may be adjusted at each remarketing or upon the agreement of BTT and the then-holder(s) of the RVMTP Shares. In the event that all of the RVMTP Shares submitted for remarketing are not successfully remarketed, a failed remarketing would occur, and all holders would retain their RVMTP Shares. In the event of a failed remarketing, the fixed rate spread would be set at the fixed rate spread applicable to such failed remarketing. BTT has the right to reject any fixed spread determined at a remarketing, and such rejection would result in a failed remarketing and the fixed rate spread would be set at the fixed rate spread applicable to such failed remarketing. The fixed rate spread applicable due to a failed remarketing depends on whether the remarketing was pursuant to a mandatory or non-mandatory tender. In the case of a failed remarketing following a mandatory tender, the failed remarketing spread would be the sum of the last applicable spread in effect immediately prior to the failed remarketing date for such failed remarketing plus 0.75%. In the case of a failed remarketing not associated with a mandatory tender, the failed remarketing spread would be the sum of the last applicable spread in effect immediately prior to the failed remarketing date for such failed remarketing plus 0.25%.

For the year ended July 31, 2021, the average annualized dividend rate for the RVMTP Shares was 0.67%.

Remarketing: In the event of a failed remarketing that is not subsequently cured, BTT will be required to redeem the RVMTP Shares subject to such failed remarketing on a date that is approximately six months from the remarketing date for such failed remarketing, provided that no redemption of any RVMTP Share may occur within one year of the date of issuance of such RVMTP Share. At the date of issuance and as of period end, the RVMTP Shares were assigned long-term ratings of Aa2 from Moody’s and AA from Fitch. The dividend rate on the RVMTP Shares is subject to a step-up spread if BTT fails to comply with certain provisions, including, among other things, the timely payment of dividends, redemptions or gross-up payments, and complying with certain asset coverage and leverage requirements.

During the year ended July 31, 2021, no RVMTP Shares were tendered for remarketing.

For the year ended July 31, 2021, RVMTP Shares issued and outstanding of BTT remained constant.

 

 

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Notes to Financial Statements  (continued)

 

Offering Costs: The Trusts incurred costs in connection with the issuance of VRDP, VMTP and RVMTP Shares, which were recorded as a direct deduction from the carrying value of the related debt liability and will be amortized over the life of the VRDP, VMTP and RVMTP Shares with the exception of any upfront fees paid by a VRDP Trust to the liquidity provider which, if any, were amortized over the life of the liquidity agreement. Amortization of these costs is included in interest expense, fees and amortization of offering costs in the Statements of Operations.

Financial Reporting: The VRDP, VMTP and RVMTP Shares are considered debt of the issuer; therefore, the liquidation preference, which approximates fair value of the VRDP, VMTP and RVMTP Shares, is recorded as a liability in the Statements of Assets and Liabilities net of deferred offering costs. Unpaid dividends are included in interest expense and fees payable in the Statements of Assets and Liabilities, and the dividends accrued and paid on the VRDP, VMTP and RVMTP Shares are included as a component of interest expense, fees and amortization of offering costs in the Statements of Operations. The VRDP, VMTP and RVMTP Shares are treated as equity for tax purposes. Dividends paid to holders of the VRDP, VMTP and RVMTP Shares are generally classified as tax-exempt income for tax-reporting purposes. Dividends and amortization of deferred offering costs on VRDP, VMTP and RVMTP Shares are included in interest expense, fees and amortization of offering costs in the Statements of Operations:

 

     
Trust Name   Dividends Accrued      Deferred Offering
Costs Amortization
 

BFZ

  $  1,403,820      $  

BTT

    5,009,941        31,271  

BNY

    1,068,171        7,541  

 

11.

SUBSEQUENT EVENTS

Management’s evaluation of the impact of all subsequent events on the Trusts’ financial statements was completed through the date the financial statements were issued and the following items were noted:

The Trusts declared and paid or will pay distributions to Common Shareholders and Preferred Shareholders as follows:

 

         
Trust Name   Declaration
Date
     Record
Date
     Payable/
Paid Date
     Dividend Per
Common Share
 

BFZ

          
    08/02/21        08/16/21        09/01/21      $ 0.043000  
    09/01/21        09/15/21        10/01/21        0.043000  

BTT

          
    08/02/21        08/16/21        09/01/21        0.062400  
    09/01/21        09/15/21        10/01/21        0.062400  

BNY

          
    08/02/21        08/16/21        09/01/21        0.056500  
      09/01/21        09/15/21        10/01/21        0.056500  

 

    

Preferred Shares(a)

 

Trust Name

 

Shares

    

Series

    

Declared

 

BFZ

    VMTP        W-7      $  112,026  

BTT

    RVMTP        W-7        409,533  

BNY

    VRDP        W-7        128,283  

 

  (a)

Dividends declared for the period August 1, 2021 to August 31, 2021.

 

 

 

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Report of Independent Registered Public Accounting Firm

 

To the Shareholders and Board of Trustees of BlackRock California Municipal Income Trust, BlackRock Municipal 2030 Target Term Trust, and BlackRock New York Municipal Income Trust:

Opinion on the Financial Statements and Financial Highlights

We have audited the accompanying statements of assets and liabilities of BlackRock California Municipal Income Trust, BlackRock Municipal 2030 Target Term Trust, and BlackRock New York Municipal Income Trust (the “Funds”), including the schedules of investments, as of July 31, 2021, the related statements of operations and cash flows for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, the financial highlights for each of the five years in the period then ended, and the related notes. In our opinion, the financial statements and financial highlights present fairly, in all material respects, the financial position of the Funds as of July 31, 2021, and the results of their operations and their cash flows for the year then ended, the changes in their net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended, in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

These financial statements and financial highlights are the responsibility of the Funds’ management. Our responsibility is to express an opinion on the Funds’ financial statements and financial highlights based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Funds in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement, whether due to error or fraud. The Funds are not required to have, nor were we engaged to perform, an audit of their internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Funds’ internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements and financial highlights, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements and financial highlights. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements and financial highlights. Our procedures included confirmation of securities owned as of July 31, 2021, by correspondence with the custodian and brokers; when replies were not received from brokers, we performed other auditing procedures. We believe that our audits provide a reasonable basis for our opinion.

Deloitte & Touche LLP

Boston, Massachusetts

September 21, 2021

We have served as the auditor of one or more BlackRock investment companies since 1992.

 

 

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Important Tax Information  (unaudited)   

 

For the fiscal period ended April 12, 2021, the Funds designate the following amounts paid as exempt-interest dividends:

 

   
Fund Name   Exempt-Interest
Dividends
 

BSE

  $ 3,058,962  

BFY

    3,068,123  

 

 

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Disclosure of Investment Advisory Agreements

 

The Boards of Trustees (collectively, the “Board,” the members of which are referred to as “Board Members”) of BlackRock California Municipal Income Trust (“BFZ”), BlackRock Municipal 2030 Target Term Trust (“BTT”) and BlackRock New York Municipal Income Trust (“BNY”), and together with BFZ and BTT, the “Funds” and each, a “Fund”) met on May 4, 2021 (the “May Meeting”) and June 8-9, 2021 (the “June Meeting”) to consider the approval to continue the investment advisory agreements (the “Advisory Agreements”) or (the “Agreements”) between each Fund and BlackRock Advisors, LLC (the “Manager” or “BlackRock”), each Fund’s investment advisor.

The Approval Process:

Consistent with the requirements of the Investment Company Act of 1940 (the “1940 Act”), the Board considers the approval of the continuation of the Agreements for each Fund on an annual basis. The Board members whom are not “interested persons” of each Fund, as defined in the 1940 Act, are considered independent Board members (the “Independent Board Members”). The Board’s consideration entailed a year-long deliberative process during which the Board and its committees assessed BlackRock’s various services to each Fund, including through the review of written materials and oral presentations, and the review of additional information provided in response to requests from the Independent Board Members. The Board had four quarterly meetings per year, each typically extending for two days, as well as additional ad hoc meetings and executive sessions throughout the year, as needed. The committees of the Board similarly met throughout the year. The Board also had a fifth one-day meeting to consider specific information surrounding the renewal of the Agreements. In particular, the Board assessed, among other things, the nature, extent and quality of the services provided to each Fund by BlackRock, BlackRock’s personnel and affiliates, including (as applicable): investment management services; accounting oversight; administrative and shareholder services; oversight of each Fund’s service providers; risk management and oversight; and legal, regulatory and compliance services. Throughout the year, including during the contract renewal process, the Independent Board Members were advised by independent legal counsel, and met with independent legal counsel in various executive sessions outside of the presence of BlackRock’s management.

During the year, the Board, acting directly and through its committees, considered information that was relevant to its annual consideration of the renewal of the Agreements, including the services and support provided by BlackRock to each Fund and its shareholders. BlackRock also furnished additional information to the Board in response to specific questions from the Board. Among the matters the Board considered were: (a) investment performance for one-year, three-year, five-year, and/or since inception periods, as applicable, against peer funds, relevant benchmarks, and other performance metrics, as applicable, as well as BlackRock senior management’s and portfolio managers’ analyses of the reasons for any outperformance or underperformance relative to its peers, benchmarks, and other performance metrics, as applicable; (b) leverage management, as applicable; (c) fees, including advisory, administration, if applicable, and other amounts paid to BlackRock and its affiliates by each Fund for services; (d) Fund operating expenses and how BlackRock allocates expenses to each Fund; (e) the resources devoted to risk oversight of, and compliance reports relating to, implementation of each Fund’s investment objective, policies and restrictions, and meeting regulatory requirements; (f) BlackRock’s and each Fund’s adherence to applicable compliance policies and procedures; (g) the nature, character and scope of non-investment management services provided by BlackRock and its affiliates and the estimated cost of such services, as available; (h) BlackRock’s and other service providers’ internal controls and risk and compliance oversight mechanisms; (i) BlackRock’s implementation of the proxy voting policies approved by the Board; (j) execution quality of portfolio transactions; (k) BlackRock’s implementation of each Fund’s valuation and liquidity procedures; (l) an analysis of management fees paid to BlackRock for products with similar investment mandates across the open-end fund, closed-end fund, sub-advised mutual fund, collective investment trust and institutional separate account product channels, as applicable, and the similarities and differences between these products and the services provided as compared to each Fund; (m) BlackRock’s compensation methodology for its investment professionals and the incentives and accountability it creates, along with investment professionals’ investments in the fund(s) they manage; (n) periodic updates on BlackRock’s business; and (o) each Fund’s market discount/premium compared to peer funds.

Prior to and in preparation for the May Meeting, the Board received and reviewed materials specifically relating to the renewal of the Agreements. The Independent Board Members are continuously engaged in a process with their independent legal counsel and BlackRock to review the nature and scope of the information provided to the Board to better assist its deliberations. The materials provided in connection with the May Meeting included, among other things: (a) information independently compiled and prepared by Broadridge Financial Solutions, Inc. (“Broadridge”), based on Lipper classifications, regarding each Fund’s fees and expenses as compared with a peer group of funds as determined by Broadridge (“Expense Peers”) and the investment performance of each Fund as compared with a peer group of funds (“Performance Peers”); (b) information on the composition of the Expense Peers and Performance Peers and a description of Broadridge’s methodology; (c) information on the estimated profits realized by BlackRock and its affiliates pursuant to the Agreements and a discussion of fall-out benefits to BlackRock and its affiliates; (d) a general analysis provided by BlackRock concerning investment management fees received in connection with other types of investment products, such as institutional accounts, sub-advised mutual funds, closed-end funds, and open-end funds, under similar investment mandates, as applicable; (e) a review of non-management fees; (f) the existence, impact and sharing of potential economies of scale, if any, with each Fund; (g) a summary of aggregate amounts paid by each Fund to BlackRock; and (h) various additional information requested by the Board as appropriate regarding BlackRock’s and each Fund’s operations.

At the May Meeting, the Board reviewed materials relating to its consideration of the Agreements. As a result of the discussions that occurred during the May Meeting, and as a culmination of the Board’s year-long deliberative process, the Board presented BlackRock with questions and requests for additional information. BlackRock responded to these questions and requests with additional written information in advance of the June Meeting.

At the June Meeting, the Board concluded its assessment of, among other things: (a) the nature, extent and quality of the services provided by BlackRock; (b) the investment performance of each Fund as compared to its Performance Peers and to other metrics, as applicable; (c) the advisory fee and the estimated cost of the services and estimated profits realized by BlackRock and its affiliates from their relationship with each Fund; (d) each Fund’s fees and expenses compared to its Expense Peers; (e) the existence and sharing of potential economies of scale; (f) any fall-out benefits to BlackRock and its affiliates as a result of BlackRock’s relationship with each Fund; and (g) other factors deemed relevant by the Board Members.

The Board also considered other matters it deemed important to the approval process, such as other payments made to BlackRock or its affiliates relating to securities lending and cash management, and BlackRock’s services related to the valuation and pricing of Fund portfolio holdings. The Board noted the willingness of BlackRock’s personnel to engage in open, candid discussions with the Board. The Board Members did not identify any particular information, or any single factor as determinative, and each Board Member may have attributed different weights to the various items and factors considered.

 

 

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Disclosure of Investment Advisory Agreements  (continued)

 

A. Nature, Extent and Quality of the Services Provided by BlackRock

The Board, including the Independent Board Members, reviewed the nature, extent and quality of services provided by BlackRock, including the investment advisory services, and the resulting performance of each Fund. Throughout the year, the Board compared Fund performance to the performance of a comparable group of closed-end funds, relevant benchmarks, and performance metrics, as applicable. The Board met with BlackRock’s senior management personnel responsible for investment activities, including the senior investment officers. The Board also reviewed the materials provided by each Fund’s portfolio management team discussing each Fund’s performance, investment strategies and outlook.

The Board considered, among other factors, with respect to BlackRock: the number, education and experience of investment personnel generally and each Fund’s portfolio management team; research capabilities; investments by portfolio managers in the funds they manage; portfolio trading capabilities; use of technology; commitment to compliance; credit analysis capabilities; risk analysis and oversight capabilities; and the approach to training and retaining portfolio managers and other research, advisory and management personnel. The Board also considered BlackRock’s overall risk management program, including the continued efforts of BlackRock and its affiliates to address cybersecurity risks and the role of BlackRock’s Risk & Quantitative Analysis Group. The Board engaged in a review of BlackRock’s compensation structure with respect to each Fund’s portfolio management team and BlackRock’s ability to attract and retain high-quality talent and create performance incentives.

In addition to investment advisory services, the Board considered the nature and quality of the administrative and other non-investment advisory services provided to each Fund. BlackRock and its affiliates provide each Fund with certain administrative, shareholder and other services (in addition to any such services provided to each Fund by third parties) and officers and other personnel as are necessary for the operations of each Fund. In particular, BlackRock and its affiliates provide each Fund with administrative services including, among others: (i) responsibility for disclosure documents, such as the prospectus and the statement of additional information in connection with the initial public offering and periodic shareholder reports; (ii) preparing communications with analysts to support secondary market trading of each Fund; (iii) oversight of daily accounting and pricing; (iv) responsibility for periodic filings with regulators and stock exchanges; (v) overseeing and coordinating the activities of third-party service providers including, among others, each Fund’s custodian, fund accountant, transfer agent, and auditor; (vi) organizing Board meetings and preparing the materials for such Board meetings; (vii) providing legal and compliance support; (viii) furnishing analytical and other support to assist the Board in its consideration of strategic issues such as the merger, consolidation or repurposing of certain closed-end funds; and (ix) performing or managing administrative functions necessary for the operation of each Fund, such as tax reporting, expense management, fulfilling regulatory filing requirements, and shareholder call center and other services. The Board reviewed the structure and duties of BlackRock’s fund administration, shareholder services, and legal and compliance departments and considered BlackRock’s policies and procedures for assuring compliance with applicable laws and regulations. The Board considered the operation of BlackRock’s business continuity plans, including in light of the ongoing COVID-19 pandemic.

B. The Investment Performance of each Fund and BlackRock

The Board, including the Independent Board Members, reviewed and considered the performance history of each Fund throughout the year and at the May Meeting. In preparation for the May Meeting, the Board was provided with reports independently prepared by Broadridge, which included an analysis of each Fund’s performance as of December 31, 2020, as compared to its Performance Peers. The performance information is based on net asset value (NAV), and utilizes Lipper data. Lipper’s methodology calculates a fund’s total return assuming distributions are reinvested on the ex-date at a fund’s ex-date NAV. Broadridge ranks funds in quartiles, ranging from first to fourth, where first is the most desirable quartile position and fourth is the least desirable. In connection with its review, the Board received and reviewed information regarding the investment performance of each Fund as compared to its Performance Peers and, with respect to BFZ and BNY, a custom peer group of funds as defined by BlackRock (“Customized Peer Group”) and a composite measuring a blend of total return and yield (“Composite”) and the performance of BTT as compared with its custom benchmark. The Board and its Performance Oversight Committee regularly review and meet with Fund management to discuss the performance of each Fund throughout the year.

In evaluating performance, the Board focused particular attention on funds with less favorable performance records. The Board also noted that while it found the data provided by Broadridge generally useful, it recognized the limitations of such data, including in particular, that notable differences may exist between a fund and its Performance Peers (for example, the investment objectives and strategies). Further, the Board recognized that the performance data reflects a snapshot of a period as of a particular date and that selecting a different performance period could produce significantly different results. The Board also acknowledged that long-term performance could be impacted by even one period of significant outperformance or underperformance, and that a single investment theme could have the ability to disproportionately affect long-term performance.

The Board noted that for each of the one-, three- and five-year periods reported, BFZ ranked in the second quartile against its Customized Peer Group Composite. The Board noted that BlackRock believes that the Customized Peer Group Composite is an appropriate performance metric for BFZ, and that BlackRock has explained its rationale for this belief to the Board.

The Board noted that for the one-, three- and five-year periods reported, BTT underperformed, outperformed and outperformed, respectively, its customized benchmark. The Board noted that BlackRock believes that performance relative to the customized benchmark is an appropriate performance metric for BTT, and that BlackRock has explained its rationale for this belief to the Board. The Board and BlackRock reviewed BTT’s underperformance relative to its customized benchmark during the applicable period.

The Board noted that for the one-, three- and five-year periods reported, BNY ranked in the first, second and second quartiles, respectively, against its Customized Peer Group Composite. The Board noted that BlackRock believes that the Customized Peer Group Composite is an appropriate performance metric for BNY, and that BlackRock has explained its rationale for this belief to the Board.

C. Consideration of the Advisory/Management Fees and the Estimated Cost of the Services and Estimated Profits Realized by BlackRock and its Affiliates from their Relationship with each Fund

The Board, including the Independent Board Members, reviewed each Fund’s contractual management fee rate compared with those of its Expense Peers. The contractual management fee rate represents a combination of the advisory fee and any administrative fees, before taking into account any reimbursements or fee waivers. The Board also compared each Fund’s total expense ratio, as well as its actual management fee rate as a percentage of managed assets, which is the total assets of each Fund (including any assets attributable to money borrowed for investment purposes) minus the sum of each Fund’s accrued liabilities (other than money borrowed for investment purposes) to those of its Expense Peers. The total expense ratio represents a fund’s total net operating expenses, excluding any investment related expenses. The total expense ratio gives

 

 

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Disclosure of Investment Advisory Agreements  (continued)

 

effect to any expense reimbursements or fee waivers, and the actual management fee rate gives effect to any management fee reimbursements or waivers. The Board considered the services provided and the fees charged by BlackRock and its affiliates to other types of clients with similar investment mandates, as applicable, including institutional accounts and sub-advised mutual funds (including mutual funds sponsored by third parties).

The Board received and reviewed statements relating to BlackRock’s financial condition. The Board reviewed BlackRock’s profitability methodology and was also provided with an estimated profitability analysis that detailed the revenues earned and the expenses incurred by BlackRock for services provided to each Fund. The Board reviewed BlackRock’s estimated profitability with respect to each Fund and other funds the Board currently oversees for the year ended December 31, 2020 compared to available aggregate estimated profitability data provided for the prior two years. The Board reviewed BlackRock’s estimated profitability with respect to certain other U.S. fund complexes managed by the Manager and/or its affiliates. The Board reviewed BlackRock’s assumptions and methodology of allocating expenses in the estimated profitability analysis, noting the inherent limitations in allocating costs among various advisory products. The Board recognized that profitability may be affected by numerous factors including, among other things, fee waivers and expense reimbursements by the Manager, the types of funds managed, precision of expense allocations and business mix. The Board thus recognized that calculating and comparing profitability at the individual fund level is difficult.

The Board noted that, in general, individual fund or product line profitability of other advisors is not publicly available. The Board reviewed BlackRock’s overall operating margin, in general, compared to that of certain other publicly traded asset management firms. The Board considered the differences between BlackRock and these other firms, including the contribution of technology at BlackRock, BlackRock’s expense management, and the relative product mix.

The Board considered whether BlackRock has the financial resources necessary to attract and retain high quality investment management personnel to perform its obligations under the Agreements and to continue to provide the high quality of services that is expected by the Board. The Board further considered factors including but not limited to BlackRock’s commitment of time, assumption of risk, and liability profile in servicing each Fund, including in contrast to what is required of BlackRock with respect to other products with similar investment mandates across the open-end fund, closed-end fund, sub-advised mutual fund, collective investment trust, and institutional separate account product channels, as applicable.

The Board noted that BFZ’s contractual management fee rate ranked in the first quartile, and that the actual management fee rate and total expense ratio each ranked in the second quartile relative to the Expense Peers.

The Board noted that BTT’s contractual management fee rate ranked in the first quartile, and that the actual management fee rate and total expense ratio each ranked in the first quartile, relative to the Expense Peers.

The Board noted that BNY’s contractual management fee rate ranked in the second quartile, and that the actual management fee rate and total expense ratio each ranked in the first quartile, relative to the Expense Peers.

D. Economies of Scale

The Board, including the Independent Board Members, considered the extent to which economies of scale might be realized as the assets of each Fund increase. The Board also considered the extent to which each Fund benefits from such economies of scale in a variety of ways, and whether there should be changes in the advisory fee rate or breakpoint structure in order to enable each Fund to more fully participate in these economies of scale. The Board considered each Fund’s asset levels and whether the current fee was appropriate.

Based on the Board’s review and consideration of the issue, the Board concluded that most closed-end funds do not have fund level breakpoints because closed-end funds generally do not experience substantial growth after the initial public offering. Closed-end funds are typically priced at scale at a fund’s inception.

E. Other Factors Deemed Relevant by the Board Members

The Board, including the Independent Board Members, also took into account other ancillary or “fall-out” benefits that BlackRock or its affiliates may derive from BlackRock’s respective relationships with each Fund, both tangible and intangible, such as BlackRock’s ability to leverage its investment professionals who manage other portfolios and its risk management personnel, an increase in BlackRock’s profile in the investment advisory community, and the engagement of BlackRock’s affiliates as service providers to each Fund, including for administrative, securities lending and cash management services. The Board also considered BlackRock’s overall operations and its efforts to expand the scale of, and improve the quality of, its operations. The Board also noted that, subject to applicable law, BlackRock may use and benefit from third-party research obtained by soft dollars generated by certain registered fund transactions to assist in managing all or a number of its other client accounts.

In connection with its consideration of the Agreements, the Board also received information regarding BlackRock’s brokerage and soft dollar practices. The Board received reports from BlackRock which included information on brokerage commissions and trade execution practices throughout the year.

The Board noted the competitive nature of the closed-end fund marketplace, and that shareholders are able to sell their Fund shares in the secondary market if they believe that each Fund’s fees and expenses are too high or if they are dissatisfied with the performance of each Fund.

The Board also considered the various notable initiatives and projects BlackRock performed in connection with its closed-end fund product line. These initiatives included developing equity shelf programs; efforts to eliminate product overlap with fund mergers; ongoing services to manage leverage that has become increasingly complex; periodic evaluation of share repurchases and other support initiatives for certain BlackRock funds; and continued communication efforts with shareholders, fund analysts and financial advisers. With respect to the latter, the Independent Board Members noted BlackRock’s continued commitment to supporting the secondary market for the common shares of its closed-end funds through a comprehensive secondary market communication program designed to raise investor and analyst awareness and understanding of closed-end funds. BlackRock’s support services included, among other things: sponsoring and participating in conferences; communicating with closed-end fund analysts covering the BlackRock funds throughout the year; providing marketing and product updates for the closed-end funds; and maintaining and enhancing its closed-end fund website.

 

 

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Disclosure of Investment Advisory Agreements  (continued)

 

Conclusion

The Board, including the Independent Board Members, unanimously approved the continuation of the Advisory Agreements between the Manager and each Fund for a one-year term ending June 30, 2022. Based upon its evaluation of all of the aforementioned factors in their totality, as well as other information, the Board, including the Independent Board Members, was satisfied that the terms of the Agreements were fair and reasonable and in the best interest of each Fund and its shareholders. In arriving at its decision to approve the Agreements, the Board did not identify any single factor or group of factors as all-important or controlling, but considered all factors together, and different Board Members may have attributed different weights to the various factors considered. The Independent Board Members were also assisted by the advice of independent legal counsel in making this determination.

 

 

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Investment Objectives, Policies and Risks

 

Recent Changes

The following information is a summary of certain changes since July 31, 2020. This information may not reflect all of the changes that have occurred since you purchased the relevant Fund.

During each Fund’s most recent fiscal year, there were no material changes in the Fund’s investment objectives or policies that have not been approved by shareholders or in the principal risk factors associated with investment in the Fund.

Investment Objectives and Policies

BlackRock California Municipal Income Trust (BFZ)

The Fund’s investment objective is to provide current income exempt from federal income taxes and California income taxes. The Fund will invest primarily in investments the income from which is exempt from federal income tax and California income taxes (except that interest may be subject to the alternative minimum tax). The Fund’s investment policies provide that, as a matter of fundamental policy, under normal market conditions, the Fund will invest at least 80% of its total assets in tax-exempt municipal bonds. For the purposes of the foregoing policy “managed assets” are the Fund’s net assets plus borrowings for investment purposes. The Fund may not change its investment objective or the foregoing fundamental policy without the approval of the holders of a majority of the outstanding common shares and the outstanding preferred shares voting together as a single class, and of the holders of a majority of the outstanding preferred Shares voting as a separate class. A majority of the outstanding means (1) 67% or more of the shares present at a meeting, if the holders of more than 50% of the outstanding shares are present or represented by proxy, or (2) more than 50% of the outstanding shares, whichever is less.

The Fund’s investment policies provide that, under normal market conditions, the Fund will invest at least 80% of its total assets in investment grade quality municipal bonds. Investment grade quality means that such bonds are rated, at the time of investment, within the four highest rating categories of Moody’s Investors Service, Inc. (“Moody’s”) (currently Aaa, Aa, A and Baa), S&P Global Ratings (“S&P”) (currently AAA, AA, A and BBB) or Fitch Ratings, Inc. (“Fitch”) (currently AAA, AA, A and BBB) or are unrated but judged to be of comparable quality by BlackRock Advisors, LLC (the “Manager”). Municipal bonds rated Baa by Moody’s are investment grade, but Moody’s considers municipal bonds rated Baa to have speculative characteristics. Changes in economic conditions or other circumstances are more likely to lead to a weakened capacity for issuers of municipal bonds that are rated BBB or Baa (or that have equivalent ratings) to make principal and interest payments than is the case for issuers of higher grade municipal bonds. In the case of short term notes, the investment grade rating categories are SP-1+ through SP-2 for S&P, MIG-1 through MIG-3 for Moody’s and F-1+ through F-3 for Fitch. In the case of tax exempt commercial paper, the investment grade rating categories are A-1+ through A-3 for S&P, Prime-1 through Prime-3 for Moody’s and F-1+ through F-3 for Fitch. Obligations ranked in the lowest investment grade rating category (BBB, SP-2 and A-3 for S&P; Baa, MIG-3 and Prime-3 for Moody’s and BBB and F-3 for Fitch), while considered “investment grade,” may have certain speculative characteristics. There may be sub-categories or gradations indicating relative standing within the rating categories set forth above. In assessing the quality of municipal bonds with respect to the foregoing requirements, the Manager takes into account the nature of any letters of credit or similar credit enhancement to which particular municipal bonds are entitled and the creditworthiness of the financial institution that provided such credit enhancement.

The Fund may invest up to 20% of its total assets in municipal bonds that are rated, at the time of investment, Ba/BB or B by Moody’s, S&P or Fitch or that are unrated but judged to be of comparable quality by the Manager. Such securities, sometimes referred to as “high yield” or “junk” bonds, are predominantly speculative with respect to the capacity to pay interest and repay principal in accordance with the terms of the security and generally involve a greater volatility of price than securities in higher rating categories.

The foregoing credit quality policies apply only at the time a security is purchased, and the Fund is not required to dispose of a security if a rating agency downgrades its assessment of the credit characteristics of a particular issue. In determining whether to retain or sell a security that a rating agency has downgraded, the Manager may consider such factors as the Manager’s assessment of the credit quality of the issuer of the security, the price at which the security could be sold and the rating, if any, assigned to the security by other rating agencies. In the event that the Fund disposes of a portfolio security subsequent to its being downgraded, the Fund may experience a greater risk of loss than if such security had been sold prior to such downgrade.

Subject to the Fund’s policy of investing, under normal market conditions, at least 80% of its managed assets (as defined for this policy) in investments the income from which is exempt from federal income tax and California income taxes, the Fund may invest in securities that pay interest that is not exempt from California income tax when, in the judgment of the Manager, the return to the shareholders after payment of applicable California income taxes would be higher than the return available from comparable securities that pay interest that is, or make other distributions that are, exempt from California income tax.

The Fund may also invest in securities of other open- or closed-end investment companies that invest primarily in municipal bonds of the types in which the Fund may invest directly and in tax-exempt preferred shares that pay dividends that are exempt from regular federal income tax. In addition, the Fund may purchase municipal bonds that are additionally secured by insurance, bank credit agreements or escrow accounts. The credit quality of companies which provide these credit enhancements will affect the value of those securities. Although the insurance feature reduces certain financial risks, the premiums for insurance and the higher market price paid for insured obligations may reduce the Fund’s income. The insurance feature does not guarantee the market value of the insured obligations or the net asset value of the common shares.

The Fund may invest in certain tax exempt securities classified as “private activity bonds” (or industrial development bonds, under pre-1986 law) (in general, bonds that benefit non-governmental entities) that may subject certain investors in the Fund to an alternative minimum tax. The percentage of the Fund’s total assets invested in private activity bonds will vary from time to time. The Fund has not established any limit on the percentage of its portfolio that may be invested in municipal bonds subject to the alternative minimum tax provisions of federal tax law, and the Fund expects that a portion of the income it produces will be includable in alternative minimum taxable income.

The average maturity of the Fund’s portfolio securities varies from time to time based upon an assessment of economic and market conditions by the Manager. The Fund’s portfolio at any given time may include both long-term and intermediate-term municipal bonds.

 

 

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Investment Objectives, Policies and Risks  (continued)

 

The Fund’s stated expectation is that it will invest in municipal bonds that, in the Manager’s opinion, are underrated or undervalued. Underrated municipal bonds are those whose ratings do not, in the opinion of the Manager, reflect their true higher creditworthiness. Undervalued municipal bonds are bonds that, in the opinion of the Manager, are worth more than the value assigned to them in the marketplace. The Manager may at times believe that bonds associated with a particular municipal market sector (for example, but not limited to electric utilities), or issued by a particular municipal issuer, are undervalued. The Manager may purchase those bonds for the Fund’s portfolio because they represent a market sector or issuer that the Manager considers undervalued, even if the value of those particular bonds appears to be consistent with the value of similar bonds. Municipal bonds of particular types (for example, but not limited to hospital bonds, industrial revenue bonds or bonds issued by a particular municipal issuer) may be undervalued because there is a temporary excess of supply in that market sector, or because of a general decline in the market price of municipal bonds of the market sector for reasons that do not apply to the particular municipal bonds that are considered undervalued. The Fund’s investment in underrated or undervalued municipal bonds will be based on the Manager’s belief that their yield is higher than that available on bonds bearing equivalent levels of interest rate risk, credit risk and other forms of risk, and that their prices will ultimately rise, relative to the market, to reflect their true value. Any capital appreciation realized by the Fund will generally result in capital gain distributions subject to federal capital gains taxation. The Fund ordinarily does not intend to realize significant investment income not exempt from federal income tax. From time to time, the Fund may realize taxable capital gains.

Leverage: The Fund may utilize leverage to seek to enhance the yield and net asset value of its common shares. However, this objective cannot be achieved in all interest rate environments. The Fund currently leverages its assets through the use of variable rate muni term preferred shares (“VMTP Shares”) and residual interest municipal tender option bonds (“TOB Residuals”), which are derivative interests in municipal bonds. The TOB Residuals in which the Fund will invest pay interest or income that, in the opinion of counsel to the issuer of such TOB Residuals, is exempt from regular U.S. federal income tax.

The Fund may enter into reverse repurchase agreements with respect to its portfolio investments subject to the Fund’s investment restrictions.

The Fund reserves the right to borrow funds, subject to the Fund’s investment restrictions. The proceeds of borrowings may be used for any valid purpose including, without limitation, liquidity, investments and repurchases of shares of the Fund.

BlackRock Municipal 2030 Target Term Trust (BTT)

The Fund’s investment objectives are to provide current income that is exempt from regular federal income tax (but which may be subject to the federal alternative minimum tax in certain circumstances) and to return $25.00 per common share (the initial public offering price per common share) to holders of common shares on or about December 31, 2030. There can be no assurance that the Fund’s investment objectives, including to return $25.00 per common share to holders of common shares on or about December 31, 2030, will be achieved or that the Fund’s investment program will be successful.

As a fundamental policy, under normal market conditions, the Fund will invest at least 80% of its Managed Assets in municipal securities, the interest of which is exempt from regular federal income tax (but which may be subject to the federal alternative minimum tax in certain circumstances). “Managed Assets” means the total assets of the Fund (including any assets attributable to money borrowed for investment purposes) minus the sum of the Fund’s accrued liabilities (other than money borrowed for investment purposes).

Under normal market conditions, the Fund expects to invest at least 80% of its Managed Assets in municipal securities that at the time of investment are investment grade quality. Investment grade quality securities means that such securities are rated, at the time of investment, within the four highest rating categories of Moody’s Investors Service, Inc. (“Moody’s”) (currently Aaa, Aa, A and Baa), S&P Global Ratings (“S&P”) (currently AAA, AA, A and BBB) or Fitch Ratings, Inc. (“Fitch”) (currently AAA, AA, A and BBB) or are unrated but judged to be of comparable quality by BlackRock Advisors, LLC (the “Manager”). Municipal securities rated Baa by Moody’s are investment grade, but Moody’s considers municipal securities rated Baa to have speculative characteristics. Changes in economic conditions or other circumstances are more likely to lead to a weakened capacity for issuers of municipal securities that are rated BBB or Baa (or that have equivalent ratings) to make principal and interest payments than is the case for issuers of higher grade municipal securities. In the case of short term notes, the investment grade rating categories are SP-1+ through SP-2 for S&P, MIG-1 through MIG-3 for Moody’s and F-1+ through F-3 for Fitch. In the case of tax-exempt commercial paper, the investment grade rating categories are A-1+ through A-3 for S&P, Prime-1 through Prime-3 for Moody’s and F-1+ through F-3 for Fitch. Obligations ranked in the lowest investment grade rating category (BBB, SP-2 and A-3 for S&P; Baa, MIG-3 and Prime-3 for Moody’s and BBB and F-3 for Fitch), while considered “investment grade,” may have certain speculative characteristics. There may be sub-categories or gradations indicating relative standing within the rating categories set forth above. In assessing the quality of municipal securities with respect to the foregoing requirements, the Manager takes into account the nature of any letters of credit or similar credit enhancement to which particular municipal securities are entitled and the creditworthiness of the financial institution that provided such credit enhancement.

The Fund may invest up to 20% of its Managed Assets in municipal securities that are rated, at the time of investment, below investment grade quality (rated Ba/BB or below by Moody’s, S&P or Fitch) or securities that are unrated but judged to be of comparable quality by the Manager. Such securities, sometimes referred to as “high yield” or “junk” bonds, are predominantly speculative with respect to the capacity to pay interest and repay principal in accordance with the terms of the security and generally involve a greater volatility of price than securities in higher rating categories.

The Fund may invest 25% or more of its Managed Assets in municipal securities of issuers in the same state (or U.S. Territory) or in the same economic sector.

The foregoing credit quality policies apply only at the time a security is purchased, and the Fund is not required to dispose of a security if a rating agency downgrades its assessment of the credit characteristics of a particular issue. In determining whether to retain or sell a security that a rating agency has downgraded, the Manager may consider such factors as the Manager’s assessment of the credit quality of the issuer of the security, the price at which the security could be sold and the rating, if any, assigned to the security by other rating agencies. In the event that the Fund disposes of a portfolio security subsequent to its being downgraded, the Fund may experience a greater risk of loss than if such security had been sold prior to such downgrade.

The Fund may also invest in securities of other open- or closed-end investment companies that invest primarily in municipal securities of the types in which the Fund may invest directly and in tax-exempt preferred shares that pay dividends exempt from regular federal income tax. Additionally, the Fund may purchase municipal securities that are additionally secured by insurance, bank credit agreements or escrow accounts. The credit quality of companies which provide these credit enhancements will affect the value

 

 

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Investment Objectives, Policies and Risks  (continued)

 

of those securities. Although the insurance feature reduces certain financial risks, the premiums for insurance and the higher market price paid for insured obligations may reduce the Fund’s income. The insurance feature does not guarantee the market value of the insured obligations or the net asset value of the common shares. The Fund may purchase insured municipal securities and may purchase insurance for municipal securities in its portfolio.

The Fund may invest in certain tax-exempt securities classified as “private activity bonds” (or industrial development bonds, under pre-1986 law) (in general, bonds that benefit non-governmental entities) that may subject certain investors in the Fund to the federal alternative minimum tax. The percentage of the Fund’s Managed Assets invested in private activity bonds will vary from time to time. The Fund has not established any limit on the percentage of its portfolio that may be invested in municipal securities subject to the alternative minimum tax provisions of federal tax law, and the Fund expects that a portion of the income it produces will be includable in alternative minimum taxable income.

The Fund seeks to return $25.00 per common share to holders of common shares on or about December 31, 2030 (when the Fund will terminate) by actively managing its portfolio of municipal obligations, which will have an average final maturity on or about such date, and by retaining each year a percentage of its net investment income, but continue to maintain its status as a regulated investment company for federal income tax purposes. The purpose of retaining a portion of the net investment income is to enhance the Fund’s ability to return to investors $25.00 per common share outstanding upon the Fund’s termination. Such retained net investment income will generally serve to increase the net asset value of the Fund. However, if the Fund realizes any capital losses on dispositions of securities that are not offset by capital gains on the disposition of other securities, the Fund may return less than $25.00 for each common share outstanding at the end of the Fund’s term. In addition, the leverage used by the Fund may increase the possibility of incurring capital losses and the difficulty of subsequently incurring capital gains to offset such losses. However, the Manager believes that they will be able to manage the Fund’s assets so that the Fund will not realize capital losses which are not offset by capital gains over the life of the Fund on the disposition of its other assets and retained net investment income. Although neither the Manager nor the Fund can guarantee these results, their achievement should enable the Fund, on or about December 31, 2030, to have available for distribution to holders of its common shares $25.00 for each common share then outstanding. There is no assurance that the Fund will be able to achieve its investment objective of returning $25.00 per common share to holders of common shares on or about December 31, 2030.

The Fund intends to actively manage the maturity of its securities, which are expected to have a dollar weighted average effective maturity approximately equal to the Fund’s maturity date. As a result, over time the maturity of the Fund’s portfolio is expected to shorten in relation to the remaining term of the Fund.

Federal tax legislation has limited the types and volume of bonds the interest on which qualifies for a federal income tax exemption. As a result, this legislation and legislation that may be enacted in the future may affect the availability of municipal securities for investment by the Fund. The Fund ordinarily does not intend to realize significant investment income not exempt from regular federal income tax. From time to time, the Fund may realize taxable capital gains.

During temporary defensive periods, including the period during which the net proceeds of this offering are being invested, and in order to keep the Fund’s cash fully invested, the Fund may invest up to 100% of its total assets in liquid, short-term investments, including high quality, short-term securities that may be either tax-exempt or taxable. The Fund may not achieve its investment objectives under these circumstances. The Fund intends to invest in taxable short-term investments only if suitable tax-exempt short-term investments are not available at reasonable prices and yields. If the Fund invests in taxable short-term investments, a portion of the dividends would be subject to regular federal income tax.

The Fund cannot change its investment objectives without the approval of the holders of a majority of the outstanding common shares. A “majority of the outstanding” means (1) 67% or more of the shares present at a meeting, if the holders of more than 50% of the shares are present or represented by proxy, or (2) more than 50% of the shares, whichever is less.

Leverage: The Fund may utilize leverage to seek to enhance the yield and net asset value of its common shares. However, this objective cannot be achieved in all interest rate environments. The Fund currently leverages its assets through the use of remarketable variable rate muni term preferred shares (“RVMTP Shares”) and residual interest municipal tender option bonds (“TOB Residuals”), which are derivative interests in municipal bonds. The TOB Residuals in which the Fund will invest pay interest or income that, in the opinion of counsel to the issuer of such TOB Residuals, is exempt from regular U.S. federal income tax.

The Fund may enter into reverse repurchase agreements with respect to its portfolio investments subject to the Fund’s investment restrictions. The Fund may enter into “dollar roll” transactions.

The Fund may borrow money as a temporary measure for extraordinary or emergency purposes, including the payment of dividends and the settlement of securities transactions which otherwise might require untimely dispositions of Fund securities.

BlackRock New York Municipal Income Trust (BNY)

The Fund’s investment objective is to provide current income exempt from federal income taxes. The Fund’s investment policies provide that, as a matter of fundamental policy, under normal market conditions, the Fund will invest at least 80% of its managed assets in investments the income from which is exempt from federal income tax and New York State and New York City personal income taxes (except that interest may be subject to the alternative minimum tax). For the purposes of the foregoing policy “managed assets” are the Fund’s net assets plus borrowings for investment purposes. The Fund may not change its investment objective or the foregoing fundamental policy without the approval of the holders of a majority of the Fund’s outstanding common shares and outstanding preferred shares voting together as a single class, and of the holders of a majority of the outstanding preferred shares voting as a separate class. A majority of the outstanding means (1) 67% or more of the shares present at a meeting, if the holders of more than 50% of the outstanding shares are present or represented by proxy, or (2) more than 50% of the outstanding shares, whichever is less.

The Fund’s investment policies provide that, under normal market conditions, the Fund will invest at least 80% of its total assets in investment grade quality municipal bonds. Investment grade quality means that such bonds are rated, at the time of investment, within the four highest rating categories of Moody’s Investors Service, Inc. (“Moody’s”) (currently Aaa, Aa, A and Baa), S&P Global Ratings (“S&P”) (currently AAA, AA, A and BBB) or Fitch Ratings, Inc. (“Fitch”) (currently AAA, AA, A and BBB) or are unrated but judged to be of comparable quality by BlackRock Advisors, LLC (the “Manager”). Municipal bonds rated Baa by Moody’s are investment grade, but Moody’s considers municipal bonds rated Baa to have speculative characteristics. Changes in economic conditions or other circumstances are more likely to lead to a weakened capacity for

 

 

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Investment Objectives, Policies and Risks  (continued)

 

issuers of municipal bonds that are rated BBB or Baa (or that have equivalent ratings) to make principal and interest payments than is the case for issuers of higher grade municipal bonds. In the case of short term notes, the investment grade rating categories are SP-1+ through SP-2 for S&P, MIG-1 through MIG-3 for Moody’s and F-1+ through F-3 for Fitch. In the case of tax exempt commercial paper, the investment grade rating categories are A-1+ through A-3 for S&P, Prime-1 through Prime-3 for Moody’s and F-1+ through F-3 for Fitch. Obligations ranked in the lowest investment grade rating category (BBB, SP-2 and A-3 for S&P; Baa, MIG-3 and Prime-3 for Moody’s and BBB and F-3 for Fitch), while considered “investment grade,” may have certain speculative characteristics. There may be sub-categories or gradations indicating relative standing within the rating categories set forth above. In assessing the quality of municipal bonds with respect to the foregoing requirements, the Manager takes into account the nature of any letters of credit or similar credit enhancement to which particular municipal bonds are entitled and the creditworthiness of the financial institution that provided such credit enhancement.

The Fund may invest up to 20% of its total assets in municipal bonds that are rated, at the time of investment, Ba/BB or B by Moody’s, S&P or Fitch or that are unrated but judged to be of comparable quality by the Manager. Such securities, sometimes referred to as “high yield” or “junk” bonds, are predominantly speculative with respect to the capacity to pay interest and repay principal in accordance with the terms of the security and generally involve a greater volatility of price than securities in higher rating categories.

The foregoing credit quality policies apply only at the time a security is purchased, and the Fund is not required to dispose of a security if a rating agency downgrades its assessment of the credit characteristics of a particular issue. In determining whether to retain or sell a security that a rating agency has downgraded, the Manager may consider such factors as the Manager’s assessment of the credit quality of the issuer of the security, the price at which the security could be sold and the rating, if any, assigned to the security by other rating agencies. In the event that the Fund disposes of a portfolio security subsequent to its being downgraded, the Fund may experience a greater risk of loss than if such security had been sold prior to such downgrade.

Subject to the Fund’s policy of investing, under normal market conditions, at least 80% of its managed assets (as defined for this policy) in investments the income from which is exempt from federal income tax and New York City and New York State personal income taxes, the Fund may invest in securities that pay interest that is not exempt from New York City and New York State personal income taxes when, in the judgment of the Manager, the return to the shareholders after payment of applicable New York City and New York State personal income taxes would be higher than the return available from comparable securities that pay interest that is, or make other distributions that are, exempt from New York City and New York State personal income taxes.

The Fund may also invest in securities of other open- or closed-end investment companies that invest primarily in municipal bonds of the types in which the Fund may invest directly and in tax-exempt preferred shares that pay dividends that are exempt from regular federal income tax. In addition, the Fund may purchase municipal bonds that are additionally secured by insurance, bank credit agreements or escrow accounts. The credit quality of companies which provide these credit enhancements will affect the value of those securities. Although the insurance feature reduces certain financial risks, the premiums for insurance and the higher market price paid for insured obligations may reduce the Fund’s income. The insurance feature does not guarantee the market value of the insured obligations or the net asset value of the common shares.

The Fund may invest in certain tax exempt securities classified as “private activity bonds” (or industrial development bonds, under pre-1986 law) (in general, bonds that benefit non-governmental entities) that may subject certain investors in the Fund to an alternative minimum tax. The percentage of the Fund’s total assets invested in private activity bonds will vary from time to time. The Fund has not established any limit on the percentage of its portfolio that may be invested in municipal bonds subject to the alternative minimum tax provisions of federal tax law, and the Fund expects that a portion of the income it produces will be includable in alternative minimum taxable income.

The average maturity of the Fund’s portfolio securities varies from time to time based upon an assessment of economic and market conditions by the Manager. The Fund’s portfolio at any given time may include both long-term and intermediate-term municipal bonds.

The Fund’s stated expectation is that it will invest in municipal bonds that, in the Manager’s opinion, are underrated or undervalued. Underrated municipal bonds are those whose ratings do not, in the opinion of the Manager, reflect their true higher creditworthiness. Undervalued municipal bonds are bonds that, in the opinion of the Manager, are worth more than the value assigned to them in the marketplace. The Manager may at times believe that bonds associated with a particular municipal market sector (for example, but not limited to electric utilities), or issued by a particular municipal issuer, are undervalued. The Manager may purchase those bonds for the Fund’s portfolio because they represent a market sector or issuer that the Manager considers undervalued, even if the value of those particular bonds appears to be consistent with the value of similar bonds. Municipal bonds of particular types (for example, but not limited to hospital bonds, industrial revenue bonds or bonds issued by a particular municipal issuer) may be undervalued because there is a temporary excess of supply in that market sector, or because of a general decline in the market price of municipal bonds of the market sector for reasons that do not apply to the particular municipal bonds that are considered undervalued. The Fund’s investment in underrated or undervalued municipal bonds will be based on the Manager’s belief that their yield is higher than that available on bonds bearing equivalent levels of interest rate risk, credit risk and other forms of risk, and that their prices will ultimately rise, relative to the market, to reflect their true value. Any capital appreciation realized by the Fund will generally result in capital gain distributions subject to federal capital gains taxation. The Fund ordinarily does not intend to realize significant investment income not exempt from federal income tax. From time to time, the Fund may realize taxable capital gains.

Leverage: The Fund may utilize leverage to seek to enhance the yield and net asset value of its common shares. However, this objective cannot be achieved in all interest rate environments. The Fund currently leverages its assets through the use of variable rate demand preferred shares (“VRDP Shares”) and residual interest municipal tender option bonds (“TOB Residuals”), which are derivative interests in municipal bonds. The TOB Residuals in which the Fund will invest pay interest or income that, in the opinion of counsel to the issuer of such TOB Residuals, is exempt from regular U.S. federal income tax.

The Fund may enter into reverse repurchase agreements with respect to its portfolio investments subject to the Fund’s investment restrictions.

The Fund reserves the right to borrow funds, subject to the Fund’s investment restrictions. The proceeds of borrowings may be used for any valid purpose including, without limitation, liquidity, investments and repurchases of shares of the Fund.

 

 

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Investment Objectives, Policies and Risks  (continued)

 

Risk Factors

This section contains a discussion of the general risks of investing in each Fund. The net asset value and market price of, and dividends paid on, the common shares will fluctuate with and be affected by, among other things, the risks more fully described below. As with any fund, there can be no guarantee that the Fund will meet its investment objective or that the Fund’s performance will be positive for any period of time. Each risk noted below is applicable to each Fund unless the specific Fund or Funds are noted in a parenthetical.

Investment and Market Discount Risk: An investment in the Fund’s common shares is subject to investment risk, including the possible loss of the entire amount that you invest. As with any stock, the price of the Fund’s common shares will fluctuate with market conditions and other factors. If shares are sold, the price received may be more or less than the original investment. Common shares are designed for long-term investors and the Fund should not be treated as a trading vehicle. Shares of closed-end management investment companies frequently trade at a discount from their net asset value. This risk is separate and distinct from the risk that the Fund’s net asset value could decrease as a result of its investment activities. At any point in time an investment in the Fund’s common shares may be worth less than the original amount invested, even after taking into account distributions paid by the Fund. During periods in which the Fund may use leverage, the Fund’s investment, market discount and certain other risks will be magnified.

Limited Term Risk (BTT): The Fund will terminate on or about December 31, 2030 in accordance with the terms of its Declaration of Trust, unless the Fund’s Board and shareholders approve an amendment to the Fund’s Declaration of Trust to extend the Fund’s termination date. The Fund seeks to return $25.00 per common share (the initial public offering price per common share) to holders of common shares on or about December 31, 2030. The Fund’s limited term may cause it to sell securities when it otherwise would not, which could cause the Fund’s returns to decrease. In addition, the Fund’s limited term may cause it to invest in lower yielding securities or hold the proceeds in cash or cash equivalents, which may adversely affect the performance of the Fund or the Fund’s ability to pay dividends on the RVMTP Shares.

Debt Securities Risk: Debt securities, such as bonds, involve interest rate risk, credit risk, extension risk, and prepayment risk, among other things.

 

   

Interest Rate Risk — The market value of bonds and other fixed-income securities changes in response to interest rate changes and other factors. Interest rate risk is the risk that prices of bonds and other fixed-income securities will increase as interest rates fall and decrease as interest rates rise.

The Fund may be subject to a greater risk of rising interest rates due to the current period of historically low rates. For example, if interest rates increase by 1%, assuming a current portfolio duration of ten years, and all other factors being equal, the value of the Fund’s investments would be expected to decrease by 10%. The magnitude of these fluctuations in the market price of bonds and other fixed-income securities is generally greater for those securities with longer maturities. Fluctuations in the market price of the Fund’s investments will not affect interest income derived from instruments already owned by the Fund, but will be reflected in the Fund’s net asset value. The Fund may lose money if short-term or long-term interest rates rise sharply in a manner not anticipated by Fund management.

To the extent the Fund invests in debt securities that may be prepaid at the option of the obligor (such as mortgage-backed securities), the sensitivity of such securities to changes in interest rates may increase (to the detriment of the Fund) when interest rates rise. Moreover, because rates on certain floating rate debt securities typically reset only periodically, changes in prevailing interest rates (and particularly sudden and significant changes) can be expected to cause some fluctuations in the net asset value of the Fund to the extent that it invests in floating rate debt securities.

These basic principles of bond prices also apply to U.S. Government securities. A security backed by the “full faith and credit” of the U.S. Government is guaranteed only as to its stated interest rate and face value at maturity, not its current market price. Just like other fixed-income securities, government-guaranteed securities will fluctuate in value when interest rates change.

A general rise in interest rates has the potential to cause investors to move out of fixed-income securities on a large scale, which may increase redemptions from funds that hold large amounts of fixed-income securities. Heavy redemptions could cause the Fund to sell assets at inopportune times or at a loss or depressed value and could hurt the Fund’s performance.

 

   

Credit Risk — Credit risk refers to the possibility that the issuer of a debt security (i.e., the borrower) will not be able to make payments of interest and principal when due. Changes in an issuer’s credit rating or the market’s perception of an issuer’s creditworthiness may also affect the value of the Fund’s investment in that issuer. The degree of credit risk depends on both the financial condition of the issuer and the terms of the obligation.

 

   

Extension Risk — When interest rates rise, certain obligations will be paid off by the obligor more slowly than anticipated, causing the value of these obligations to fall.

 

   

Prepayment Risk — When interest rates fall, certain obligations will be paid off by the obligor more quickly than originally anticipated, and the Fund may have to invest the proceeds in securities with lower yields.

Municipal Securities Risks: Municipal securities risks include the ability of the issuer to repay the obligation, the relative lack of information about certain issuers of municipal securities, and the possibility of future legislative changes which could affect the market for and value of municipal securities. These risks include:

 

   

General Obligation Bonds Risks — Timely payments depend on the issuer’s credit quality, ability to raise tax revenues and ability to maintain an adequate tax base.

 

   

Revenue Bonds Risks — These payments depend on the money earned by the particular facility or class of facilities, or the amount of revenues derived from another source.

 

   

Private Activity Bonds Risks — Municipalities and other public authorities issue private activity bonds to finance development of industrial facilities for use by a private enterprise. The private enterprise pays the principal and interest on the bond, and the issuer does not pledge its full faith, credit and taxing power for repayment. The Fund’s investments may consist of private activity bonds that may subject certain shareholders to an alternative minimum tax.

 

 

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Investment Objectives, Policies and Risks  (continued)

 

   

Moral Obligation Bonds Risks — Moral obligation bonds are generally issued by special purpose public authorities of a state or municipality. If the issuer is unable to meet its obligations, repayment of these bonds becomes a moral commitment, but not a legal obligation, of the state or municipality.

 

   

Municipal Notes Risks — Municipal notes are shorter term municipal debt obligations. If there is a shortfall in the anticipated proceeds, the notes may not be fully repaid and the Fund may lose money.

 

   

Municipal Lease Obligations Risks — In a municipal lease obligation, the issuer agrees to make payments when due on the lease obligation. Although the issuer does not pledge its unlimited taxing power for payment of the lease obligation, the lease obligation is secured by the leased property.

 

   

Tax-exempt Status Risk — The Fund and its investment manager will rely on the opinion of issuers’ bond counsel and, in the case of derivative securities, sponsors’ counsel, on the tax-exempt status of interest on municipal bonds and payments under derivative securities. Neither the Fund nor its investment manager will independently review the bases for those tax opinions, which may ultimately be determined to be incorrect and subject the Fund and its shareholders to substantial tax liabilities.

State Specific Risk (BFZ and BNY): The Fund invests primarily in municipal bonds issued by or on behalf of its designated state. As a result, the Fund is more exposed to risks affecting issuers of its designated state’s municipal securities than is a fund that invests more widely. Fund management does not believe that the current economic conditions will adversely affect the Fund’s ability to invest in high quality state municipal securities in its designated state.

Taxability Risk: The Fund intends to minimize the payment of taxable income to shareholders by investing in tax-exempt or municipal securities in reliance at the time of purchase on an opinion of bond counsel to the issuer that the interest paid on those securities will be excludable from gross income for U.S. federal income tax purposes. Such securities, however, may be determined to pay, or have paid, taxable income subsequent to the Fund’s acquisition of the securities. In that event, the Internal Revenue Service may demand that the Fund pay U.S. federal income taxes on the affected interest income, and, if the Fund agrees to do so, the Fund’s yield could be adversely affected. In addition, the treatment of dividends previously paid or to be paid by the Fund as “exempt interest dividends” could be adversely affected, subjecting the Fund’s shareholders to increased U.S. federal income tax liabilities. Federal tax legislation may limit the types and volume of bonds the interest on which qualifies for a federal income tax-exemption. As a result, current legislation and legislation that may be enacted in the future may affect the availability of Municipal Bonds for investment by the Fund. In addition, future laws, regulations, rulings or court decisions may cause interest on municipal securities to be subject, directly or indirectly, to U.S. federal income taxation or exempt interest on state municipal securities that are currently exempt to be subject to state or local income taxation, or the value of state municipal securities to be subject to state or local intangible personal property tax, or may otherwise prevent the Fund from realizing the full current benefit of the tax-exempt status of such securities. Any such change could also affect the market price of such securities, and thus the value of an investment in the Fund.

Insurance Risk: Insurance guarantees that interest payments on a municipal security will be made on time and that the principal will be repaid when the security matures. However, insurance does not protect against losses caused by declines in a municipal security’s value. The Fund cannot be certain that any insurance company will make the payments it guarantees. If a municipal security’s insurer fails to fulfill its obligations or loses its credit rating, the value of the security could drop.

Junk Bonds Risk: Although junk bonds generally pay higher rates of interest than investment grade bonds, junk bonds are high risk investments that are considered speculative and may cause income and principal losses for the Fund.

U.S. Government Obligations Risk: Certain securities in which the Fund may invest, including securities issued by certain U.S. Government agencies and U.S. Government sponsored enterprises, are not guaranteed by the U.S. Government or supported by the full faith and credit of the United States.

Economic Sector and Geographic Risk (BTT): The Fund, as a fundamental policy, may not invest 25% or more of the value of its Managed Assets in any one industry. However, this limitation does not apply to securities of the U.S. Government, any state government or their respective agencies, or instrumentalities and securities backed by the credit of any federal or state governmental entity. As such, the Fund may invest 25% of more of its Managed Assets in municipal securities of issuers in the same state (or U.S. Territory) or in the same economic sector. This may make the Fund more susceptible to adverse economic, political or regulatory occurrences affecting a particular state or economic sector.

Leverage Risk: The Fund uses leverage for investment purposes through the issuance of VMTP Shares, RVMTP Shares or VRDP Shares, as applicable. The Fund also utilizes leverage for investment purposes by entering into reverse repurchase agreements, derivative instruments with leverage embedded in then, such as TOB Residuals, and, if applicable, dollar rolls. The Fund’s use of leverage may increase or decrease from time to time in its discretion and the Fund may, in the future, determine not to use leverage.

The use of leverage creates an opportunity for increased common share net investment income dividends, but also creates risks for the holders of common shares. The Fund cannot assure you that the use of leverage will result in a higher yield on the common shares. Any leveraging strategy the Fund employs may not be successful.

Leverage involves risks and special considerations for common shareholders, including:

 

   

the likelihood of greater volatility of net asset value, market price and dividend rate of the common shares than a comparable portfolio without leverage;

 

   

the risk that fluctuations in interest rates or dividend rates on any leverage that the Fund must pay will reduce the return to the common shareholders;

 

   

the effect of leverage in a declining market, which is likely to cause a greater decline in the net asset value of the common shares than if the Fund were not leveraged, which may result in a greater decline in the market price of the common shares;

 

   

leverage may increase operating costs, which may reduce total return.

 

 

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Investment Objectives, Policies and Risks  (continued)

 

Any decline in the net asset value of the Fund’s investments will be borne entirely by the holders of common shares. Therefore, if the market value of the Fund’s portfolio declines, leverage will result in a greater decrease in net asset value to the holders of common shares than if the Fund were not leveraged. This greater net asset value decrease will also tend to cause a greater decline in the market price for the common shares.

Tender Option Bonds Risk: The Fund’s participation in tender option bond transactions may reduce the Fund’s returns and/or increase volatility. Investments in tender option bond transactions expose the Fund to counterparty risk and leverage risk. An investment in a tender option bond transaction typically will involve greater risk than an investment in a municipal fixed rate security, including the risk of loss of principal. Distributions on TOB Residuals will bear an inverse relationship to short-term municipal security interest rates. Distributions on TOB Residuals paid to the Fund will be reduced or, in the extreme, eliminated as short-term municipal interest rates rise and will increase when short-term municipal interest rates fall. TOB Residuals generally will underperform the market for fixed rate municipal securities in a rising interest rate environment. The Fund may invest special purpose trusts formed for the purpose of holding municipal bonds contributed by one or more funds (“TOB Trusts”) on either a non-recourse or recourse basis. If the Fund invests in a TOB Trust on a recourse basis, it could suffer losses in excess of the value of its TOB Residuals.

Reverse Repurchase Agreements Risk: Reverse repurchase agreements involve the sale of securities held by the Fund with an agreement to repurchase the securities at an agreed-upon price, date and interest payment. Reverse repurchase agreements involve the risk that the other party may fail to return the securities in a timely manner or at all. The Fund could lose money if it is unable to recover the securities and the value of the collateral held by the Fund, including the value of the investments made with cash collateral, is less than the value of the securities. These events could also trigger adverse tax consequences for the Fund. In addition, reverse repurchase agreements involve the risk that the interest income earned in the investment of the proceeds will be less than the interest expense.

Dollar Rolls Risk (BTT): Dollar rolls involve the risk that the market value of the securities that the Fund is committed to buy may decline below the price of the securities the Fund has sold. These transactions may involve leverage.

Illiquid Investments Risk: The Fund may invest without limitation in illiquid or less liquid investments or investments in which no secondary market is readily available or which are otherwise illiquid, including private placement securities. The Fund may not be able to readily dispose of such investments at prices that approximate those at which the Fund could sell such investments if they were more widely traded and, as a result of such illiquidity, the Fund may have to sell other investments or engage in borrowing transactions if necessary to raise cash to meet its obligations. Limited liquidity can also affect the market price of investments, thereby adversely affecting the Fund’s net asset value and ability to make dividend distributions. The financial markets in general, and certain segments of the mortgage-related securities markets in particular, have in recent years experienced periods of extreme secondary market supply and demand imbalance, resulting in a loss of liquidity during which market prices were suddenly and substantially below traditional measures of intrinsic value. During such periods, some investments could be sold only at arbitrary prices and with substantial losses. Periods of such market dislocation may occur again at any time. Privately issued debt securities are often of below investment grade quality, frequently are unrated and present many of the same risks as investing in below investment grade public debt securities.

Investment Companies and ETFs Risk: Subject to the limitations set forth in the Investment Company Act of 1940, as amended (the “1940 Act”), or as otherwise limited by the SEC, the Fund may acquire shares in other investment companies and in exchange-traded funds (“ETFs”), some of which may be affiliated investment companies. The market value of the shares of other investment companies and ETFs may differ from their net asset value. As an investor in investment companies and ETFs, the Fund would bear its ratable share of that entity’s expenses, including its investment advisory and administration fees, while continuing to pay its own advisory and administration fees and other expenses (to the extent not offset by the Manager through waivers). As a result, shareholders will be absorbing duplicate levels of fees with respect to investments in other investment companies and ETFs (to the extent not offset by the Manager through waivers).

The securities of other investment companies and ETFs in which the Fund may invest may be leveraged. As a result, the Fund may be indirectly exposed to leverage through an investment in such securities. An investment in securities of other investment companies and ETFs that use leverage may expose the Fund to higher volatility in the market value of such securities and the possibility that the Fund’s long-term returns on such securities (and, indirectly, the long-term returns of shares of the Fund) will be diminished.

As with other investments, investments in other investment companies, including ETFs, are subject to market and selection risk. To the extent the Fund is held by an affiliated fund, the ability of the Fund itself to hold other investment companies may be limited.

Derivatives Risk: The Fund’s use of derivatives may increase its costs, reduce the Fund’s returns and/or increase volatility. Derivatives involve significant risks, including:

 

   

Volatility Risk — Volatility is defined as the characteristic of a security, an index or a market to fluctuate significantly in price within a short time period. A risk of the Fund’s use of derivatives is that the fluctuations in their values may not correlate with the overall securities markets.

 

   

Counterparty Risk — Derivatives are also subject to counterparty risk, which is the risk that the other party in the transaction will not fulfill its contractual obligation.

 

   

Market and Illiquidity Risk — The possible lack of a liquid secondary market for derivatives and the resulting inability of the Fund to sell or otherwise close a derivatives position could expose the Fund to losses and could make derivatives more difficult for the Fund to value accurately.

 

   

Valuation Risk — Valuation may be more difficult in times of market turmoil since many investors and market makers may be reluctant to purchase complex instruments or quote prices for them.

 

   

Hedging Risk — Hedges are sometimes subject to imperfect matching between the derivative and the underlying security, and there can be no assurance that the Fund’s hedging transactions will be effective. The use of hedging may result in certain adverse tax consequences.

 

   

Tax Risk — Certain aspects of the tax treatment of derivative instruments, including swap agreements and commodity-linked derivative instruments, are currently unclear and may be affected by changes in legislation, regulations or other legally binding authority. Such treatment may be less favorable than that given to a direct investment in an underlying asset and may adversely affect the timing, character and amount of income the Fund realizes from its investments.

 

 

N V E S T M E N T    B J E C T I V  E S ,    P O L I C I E S    A N D    I S K S

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Investment Objectives, Policies and Risks  (continued)

 

   

Regulatory Risk — Derivative contracts, including, without limitation, swaps, currency forwards and non-deliverable forwards, are subject to regulation under the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”) in the United States and under comparable regimes in Europe, Asia and other non-U.S. jurisdictions. Under the Dodd-Frank Act, certain derivatives are subject to margin requirements and swap dealers are required to collect margin from the Fund with respect to such derivatives. Specifically, regulations are now in effect that require swap dealers to post and collect variation margin (comprised of specified liquid instruments and subject to a required haircut) in connection with trading of OTC swaps with the Fund. Shares of investment companies (other than certain money market funds) may not be posted as collateral under these regulations. Requirements for posting of initial margin in connection with OTC swaps will be phased-in through at least 2021. In addition, regulations adopted by global prudential regulators that are now in effect require certain bank-regulated counterparties and certain of their affiliates to include in certain financial contracts, including many derivatives contracts, terms that delay or restrict the rights of counterparties, such as the Fund, to terminate such contracts, foreclose upon collateral, exercise other default rights or restrict transfers of credit support in the event that the counterparty and/or its affiliates are subject to certain types of resolution or insolvency proceedings. The implementation of these requirements with respect to derivatives, as well as regulations under the Dodd-Frank Act regarding clearing, mandatory trading and margining of other derivatives, may increase the costs and risks to the Fund of trading in these instruments and, as a result, may affect returns to investors in the Fund.

On October 28, 2020, the SEC adopted new regulations governing the use of derivatives by registered investment companies (“Rule 18f-4”). The Fund will be required to implement and comply with Rule 18f-4 by August 19, 2022. Once implemented, Rule 18f-4 will impose limits on the amount of derivatives a fund can enter into, eliminate the asset segregation framework currently used by funds to comply with Section 18 of the 1940 Act, treat derivatives as senior securities and require funds whose use of derivatives is more than a limited specified exposure amount to establish and maintain a comprehensive derivatives risk management program and appoint a derivatives risk manager.

Market Risk and Selection Risk: Market risk is the risk that one or more markets in which the Fund invests will go down in value, including the possibility that the markets will go down sharply and unpredictably. The value of a security or other asset may decline due to changes in general market conditions, economic trends or events that are not specifically related to the issuer of the security or other asset, or factors that affect a particular issuer or issuers, exchange, country, group of countries, region, market, industry, group of industries, sector or asset class. Local, regional or global events such as war, acts of terrorism, the spread of infectious illness or other public health issues like pandemics or epidemics, recessions, or other events could have a significant impact on the Fund and its investments. Selection risk is the risk that the securities selected by Fund management will underperform the markets, the relevant indices or the securities selected by other funds with similar investment objectives and investment strategies. This means you may lose money.

A recent outbreak of an infectious coronavirus has developed into a global pandemic that has resulted in numerous disruptions in the market and has had significant economic impact leaving general concern and uncertainty. The impact of this coronavirus, and other epidemics and pandemics that may arise in the future, could affect the economies of many nations, individual companies and the market in general ways that cannot necessarily be foreseen at the present time.

 

 

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Automatic Dividend Reinvestment Plan

 

Pursuant to BFZ and BNY’s Dividend Reinvestment Plan (the “Reinvestment Plan”), Common Shareholders are automatically enrolled to have all distributions of dividends and capital gains and other distributions reinvested by Computershare Trust Company, N.A. (the “Reinvestment Plan Agent”) in the respective Trust’s Common Shares pursuant to the Reinvestment Plan. Shareholders who do not participate in the Reinvestment Plan will receive all distributions in cash paid by check and mailed directly to the shareholders of record (or if the shares are held in street name or other nominee name, then to the nominee) by the Reinvestment Plan Agent, which serves as agent for the shareholders in administering the Reinvestment Plan.

After BFZ and BNY declare a dividend or determine to make a capital gain or other distribution, the Reinvestment Plan Agent will acquire shares for the participants’ accounts, depending upon the following circumstances, either (i) through receipt of unissued but authorized shares from the Trusts (“newly issued shares”) or (ii) by purchase of outstanding shares on the open market or on the Trust’s primary exchange (“open-market purchases”). If, on the dividend payment date, the net asset value (“NAV”) per share is equal to or less than the market price per share plus estimated brokerage commissions (such condition often referred to as a “market premium”), the Reinvestment Plan Agent will invest the dividend amount in newly issued shares acquired on behalf of the participants. The number of newly issued shares to be credited to each participant’s account will be determined by dividing the dollar amount of the dividend by the NAV on the date the shares are issued. However, if the NAV is less than 95% of the market price on the dividend payment date, the dollar amount of the dividend will be divided by 95% of the market price on the dividend payment date. If, on the dividend payment date, the NAV is greater than the market price per share plus estimated brokerage commissions (such condition often referred to as a “market discount”), the Reinvestment Plan Agent will invest the dividend amount in shares acquired on behalf of the participants in open-market purchases. If the Reinvestment Plan Agent is unable to invest the full dividend amount in open-market purchases, or if the market discount shifts to a market premium during the purchase period, the Reinvestment Plan Agent will invest any un-invested portion in newly issued shares. Investments in newly issued shares made in this manner would be made pursuant to the same process described above and the date of issue for such newly issued shares will substitute for the dividend payment date.

After BTT declares a dividend or determines to make a capital gain distribution or other distribution, the Reinvestment Plan Agent will acquire shares for the participants’ accounts by the purchase of outstanding shares on the open market or on BTT’s primary exchange (“open-market purchases”). BTT will not issue any new shares under the Reinvestment Plan.

You may elect not to participate in the Reinvestment Plan and to receive all dividends in cash by contacting the Reinvestment Plan Agent, at the address set forth below.

Participation in the Reinvestment Plan is completely voluntary and may be terminated or resumed at any time without penalty by notice if received and processed by the Reinvestment Plan Agent prior to the dividend record date. Additionally, the Reinvestment Plan Agent seeks to process notices received after the record date but prior to the payable date and such notices often will become effective by the payable date. Where late notices are not processed by the applicable payable date, such termination or resumption will be effective with respect to any subsequently declared dividend or other distribution.

The Reinvestment Plan Agent’s fees for the handling of the reinvestment of distributions will be paid by each Trust. However, each participant will pay a pro rata share of brokerage commissions incurred with respect to the Reinvestment Plan Agent’s open-market purchases in connection with the reinvestment of all distributions. The automatic reinvestment of all distributions will not relieve participants of any U.S. federal, state or local income tax that may be payable on such dividends or distributions.

Each Trust reserves the right to amend or terminate the Reinvestment Plan. There is no direct service charge to participants in the Reinvestment Plan; however, each Trust reserves the right to amend the Reinvestment Plan to include a service charge payable by the participants. Participants in BFZ, BTT and BNY that request a sale of shares are subject to a $2.50 sales fee and a $0.15 per share sold brokerage commission fee. All correspondence concerning the Reinvestment Plan should be directed to Computershare Trust Company, N.A. through the internet at computershare.com/blackrock, or in writing to Computershare, P.O. Box 505000, Louisville, KY 40233, Telephone: (800) 699-1236. Overnight correspondence should be directed to the Reinvestment Plan Agent at Computershare, 462 South 4th Street, Suite 1600, Louisville, KY 40202.

 

 

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  73


Trustee and Officer Information

 

Independent Trustees(a)
         
Name
Year of Birth
(b)
   Position(s) Held
(Length of Service)
(c)
   Principal Occupation(s) During Past Five Years    Number of BlackRock-Advised
Registered Investment Companies
(“RICs”) Consisting of
Investment Portfolios
(“Portfolios”) Overseen
   Public Company
and Other
Investment
Company Directorships Held
During Past Five Years

Richard E. Cavanagh

1946

   Co-Chair of the Board and Trustee
(Since 2007)
   Director, The Guardian Life Insurance Company of America since 1998; Board Chair, Volunteers of America (a not-for-profit organization) from 2015 to 2018 (board member since 2009); Director, Arch Chemicals (chemical and allied products) from 1999 to 2011; Trustee, Educational Testing Service from 1997 to 2009 and Chairman thereof from 2005 to 2009; Senior Advisor, The Fremont Group since 2008 and Director thereof since 1996; Faculty Member/Adjunct Lecturer, Harvard University since 2007 and Executive Dean from 1987 to 1995; President and Chief Executive Officer, The Conference Board, Inc. (global business research organization) from 1995 to 2007.    73 RICs consisting of 100 Portfolios    None

Karen P. Robards

1950

   Co-Chair of the Board and Trustee
(Since 2007)
   Principal of Robards & Company, LLC (consulting and private investing) since 1987; Co-founder and Director of the Cooke Center for Learning and Development (a not-for-profit organization) since 1987; Director of Enable Injections, LLC (medical devices) since 2019; Investment Banker at Morgan Stanley from 1976 to 1987.    73 RICs consisting of 100 Portfolios    Greenhill & Co., Inc.; AtriCure, Inc. (medical devices) from 2000 until 2017.

Michael J. Castellano

1946

   Trustee
(Since 2011)
   Chief Financial Officer of Lazard Group LLC from 2001 to 2011; Chief Financial Officer of Lazard Ltd from 2004 to 2011; Director, Support Our Aging Religious (non-profit) from 2009 to June 2015 and from 2017 to September 2020; Director, National Advisory Board of Church Management at Villanova University since 2010; Trustee, Domestic Church Media Foundation since 2012; Director, CircleBlack Inc. (financial technology company) from 2015 to July 2020.    73 RICs consisting of 100 Portfolios    None

Cynthia L. Egan

1955

   Trustee
(Since 2016)
   Advisor, U.S. Department of the Treasury from 2014 to 2015; President, Retirement Plan Services, for T. Rowe Price Group, Inc. from 2007 to 2012; executive positions within Fidelity Investments from 1989 to 2007.    73 RICs consisting of 100 Portfolios    Unum (insurance); The Hanover Insurance Group (Board Chair) (insurance); Huntsman Corporation (chemical products); Envestnet (investment platform) from 2013 until 2016.

Frank J. Fabozzi(d)

1948

   Trustee
(Since 2007)
   Editor of The Journal of Portfolio Management since 1986; Professor of Finance, EDHEC Business School (France) since 2011; Visiting Professor, Princeton University for the 2013 to 2014 academic year and Spring 2017 semester; Professor in the Practice of Finance, Yale University School of Management from 1994 to 2011 and currently a Teaching Fellow in Yale’s Executive Programs; Board Member, BlackRock Equity-Liquidity Funds from 2014 to 2016; affiliated professor Karlsruhe Institute of Technology from 2008 to 2011; Visiting Professor, Rutgers University for the Spring 2019 semester; Visiting Professor, New York University for the 2019 academic year; Adjunct Professor of Finance, Carnegie Mellon University in fall 2020 semester.    75 RICs consisting of 102 Portfolios    None

 

 

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Trustee and Officer Information  (continued)

 

Independent Trustees(a) (continued)
         
Name
Year of Birth
(b)
   Position(s) Held
(Length of Service)
(c)
   Principal Occupation(s) During Past Five Years    Number of BlackRock-Advised
Registered Investment Companies
(“RICs”)  Consisting of
Investment Portfolios
(“Portfolios”) Overseen
   Public Company
and Other
Investment
Company Directorships Held
During Past Five Years

Lorenzo A. Flores

1964

   Trustee
(Since 2021)
   Vice Chairman, Kioxia, Inc. since 2019; Chief Financial Officer, Xilinx, Inc. from 2016 to 2019; Corporate Controller, Xilinx, Inc. from 2008 to 2016.    73 RICs consisting of 100 Portfolios    None

Stayce D. Harris

1959

   Trustee
(Since 2021)
   Lieutenant General, Inspector General, Office of the Secretary of the United States Air Force from 2017 to 2019; Lieutenant General, Assistant Vice Chief of Staff and Director, Air Staff, United States Air Force from 2016 to 2017; Major General, Commander, 22nd Air Force, AFRC, Dobbins Air Reserve Base, Georgia from 2014 to 2016; Pilot, United Airlines from 1990 to 2020.    73 RICs consisting of 100 Portfolios    None

J. Phillip Holloman

1955

   Trustee
(Since 2021)
   President and Chief Operating Officer, Cintas Corporation from 2008 to 2018.    73 RICs consisting of 100 Portfolios    PulteGroup, Inc. (home construction); Rockwell Automation Inc. (industrial automation)

R. Glenn Hubbard

1958

   Trustee
(Since 2007)
   Dean, Columbia Business School from 2004 to 2019; Faculty member, Columbia Business School since 1988.    73 RICs consisting of 100 Portfolios    ADP (data and information services) 2004-2020; Metropolitan Life Insurance Company (insurance); KKR Financial Corporation (finance) from 2004 until 2014.

W. Carl Kester(d)

1951

   Trustee
(Since 2007)
   George Fisher Baker Jr. Professor of Business Administration, Harvard Business School since 2008; Deputy Dean for Academic Affairs from 2006 to 2010; Chairman of the Finance Unit, from 2005 to 2006; Senior Associate Dean and Chairman of the MBA Program from 1999 to 2005; Member of the faculty of Harvard Business School since 1981.    75 RICs consisting of 102 Portfolios    None

Catherine A. Lynch(d)

1961

   Trustee
(Since 2016)
   Chief Executive Officer, Chief Investment Officer and various other positions, National Railroad Retirement Investment Trust from 2003 to 2016; Associate Vice President for Treasury Management, The George Washington University from 1999 to 2003; Assistant Treasurer, Episcopal Church of America from 1995 to 1999.    75 RICs consisting of 102 Portfolios    None

 

 

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Trustee and Officer Information  (continued)

 

          Interested Trustees(a)(e)          
         
Name
Year of Birth
(b)
   Position(s) Held
(Length of Service)
(c)
   Principal Occupation(s) During Past Five Years    Number of BlackRock-Advised
Registered Investment Companies
(“RICs”)  Consisting of
Investment Portfolios
(“Portfolios”) Overseen
   Public Company
and Other
Investment
Company Directorships
Held During Past Five Years

Robert Fairbairn

1965

   Trustee
(Since 2018)
   Vice Chairman of BlackRock, Inc. since 2019; Member of BlackRock’s Global Executive and Global Operating Committees; Co-Chair of BlackRock’s Human Capital Committee; Senior Managing Director of BlackRock, Inc. from 2010 to 2019; oversaw BlackRock’s Strategic Partner Program and Strategic Product Management Group from 2012 to 2019; Member of the Board of Managers of BlackRock Investments, LLC from 2011 to 2018; Global Head of BlackRock’s Retail and iShares® businesses from 2012 to 2016.    103 RICs consisting of 252 Portfolios    None

John M. Perlowski(d)

1964

   Trustee (Since 2015) President and Chief Executive Officer (Since 2010)    Managing Director of BlackRock, Inc. since 2009; Head of BlackRock Global Accounting and Product Services since 2009; Advisory Director of Family Resource Network (charitable foundation) since 2009.    105 RICs consisting of 254 Portfolios    None

(a) The address of each Trustee is c/o BlackRock, Inc., 55 East 52nd Street, New York, New York 10055.

(b) Each Independent Trustee holds office until his or her successor is duly elected and qualifies or until his or her earlier death, resignation, retirement or removal as provided by the Trust’s by-laws or charter or statute, or until December 31 of the year in which he or she turns 75. Trustees who are “interested persons,” as defined in the Investment Company Act serve until their successor is duly elected and qualifies or until their earlier death, resignation, retirement or removal as provided by the Trust’s by-laws or statute, or until December 31 of the year in which they turn 72. The Board may determine to extend the terms of Independent Trustees on a case-by-case basis, as appropriate.

(c)  Following the combination of Merrill Lynch Investment Managers, L.P. (“MLIM”) and BlackRock, Inc. in September 2006, the various legacy MLIM and legacy BlackRock fund boards were realigned and consolidated into three new fund boards in 2007. Certain Independent Trustees first became members of the boards of other legacy MLIM or legacy BlackRock funds as follows: Richard E. Cavanagh, 1994; Frank J. Fabozzi, 1988; R. Glenn Hubbard, 2004; W. Carl Kester, 1995; and Karen P. Robards, 1998.

(d) Dr. Fabozzi, Dr. Kester, Ms. Lynch and Mr. Perlowski are also trustees of the BlackRock Credit Strategies Fund and BlackRock Private Investments Fund.

(e) Mr. Fairbairn and Mr. Perlowski are both “interested persons,” as defined in the 1940 Act, of the Trust based on their positions with BlackRock, Inc. and its affiliates. Mr. Fairbairn and Mr. Perlowski are also board members of the BlackRock Multi-Asset Complex.

 

 

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Trustee and Officer Information  (continued)

 

Officers Who Are Not Trustees(a)
     
Name
Year of Birth
(b)
   Position(s) Held
(Length of Service)
   Principal Occupation(s) During Past Five Years

Jonathan Diorio

1980

   Vice President (Since 2015)    Managing Director of BlackRock, Inc. since 2015; Director of BlackRock, Inc. from 2011 to 2015.

Trent Walker

1974

   Chief Financial Officer (Since 2021)    Managing Director of BlackRock, Inc. since September 2019; Executive Vice President of PIMCO from 2016 to 2019; Senior Vice President of PIMCO from 2008 to 2015; Treasurer from 2013 to 2019 and Assistant Treasurer from 2007 to 2017 of PIMCO Funds, PIMCO Variable Insurance Trust, PIMCO ETF Trust, PIMCO Equity Series, PIMCO Equity Series VIT, PIMCO Managed Accounts Trust, 2 PIMCO-sponsored interval funds and 21 PIMCO-sponsored closed-end funds.

Jay M. Fife

1970

   Treasurer
(Since 2007)
   Managing Director of BlackRock, Inc. since 2007.

Charles Park

1967

   Chief Compliance Officer (Since 2014)    Anti-Money Laundering Compliance Officer for certain BlackRock-advised Funds from 2014 to 2015; Chief Compliance Officer of BlackRock Advisors, LLC and the BlackRock-advised Funds in the BlackRock Multi-Asset Complex and the BlackRock Fixed-Income Complex since 2014; Principal of and Chief Compliance Officer for iShares® Delaware Trust Sponsor LLC since 2012 and BlackRock Fund Advisors (“BFA”) since 2006; Chief Compliance Officer for the BFA-advised iShares® exchange traded funds since 2006; Chief Compliance Officer for BlackRock Asset Management International Inc. since 2012.

Janey Ahn

1975

   Secretary
(Since 2012)
   Managing Director of BlackRock, Inc. since 2018; Director of BlackRock, Inc. from 2009 to 2017.

(a) The address of each Officer is c/o BlackRock, Inc., 55 East 52nd Street, New York, New York 10055.

(b) Officers of the Trust serve at the pleasure of the Board.

 

Neal J. Andrews retired as the Chief Financial Officer effective December 31, 2020, and Trent Walker was elected as the Chief Financial Officer effective January 1, 2021.

Effective June 10, 2021, Stayce D. Harris and J. Phillip Holloman were each appointed to serve as a Trustee of the Trusts. Effective July 30, 2021, Lorenzo A. Flores was appointed to serve as a Trustee of the Trusts.

 

 

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Additional Information

 

Proxy Results

The Annual Meeting of Shareholders was held on July 29, 2021 for shareholders of record on June 1, 2021, to elect trustee nominees for each Trust. There were no broker non-votes with regard to any of the Trusts.

Shareholders elected the Class II Trustees as follows:

 

  

 

 

J. Phillip Holloman

   

Catherine A. Lynch

   

Karen P. Robards

   

Frank J. Fabozzi(a)

 

Trust Name

 

Votes For

   

Votes Withheld

   

Votes For

   

Votes Withheld

   

Votes For

   

Votes Withheld

   

Votes For

   

Votes Withheld

 

BFZ

    18,163,649       7,838,033       18,175,739       7,825,943       18,171,962       7,829,720       1,713       0  

BTT

    59,571,627       1,213,530       59,578,466       1,206,691       59,526,233       1,258,924       150       0  

BNY

    16,867,698       2,114,998       16,770,051       2,212,645       16,719,650       2,263,046       1,794       0  

 

  (a) 

Voted on by holders of Preferred Shares only.

For the Trusts listed above, Trustees whose term of office continued after the Annual Meeting of Shareholders because they were not up for election are Michael J. Castellano, Richard E. Cavanagh, Cynthia L. Egan, Robert Fairbairn, Stayce Harris, R. Glenn Hubbard, John M. Perlowski and W. Carl Kester. Lorenzo A. Flores was appointed as a Trustee effective July 30, 2021.

Trust Certification

The Trusts are listed for trading on the NYSE and have filed with the NYSE their annual chief executive officer certification regarding compliance with the NYSE’s listing standards. The Trusts filed with the SEC the certification of its chief executive officer and chief financial officer required by Section 302 of the Sarbanes-Oxley Act.

Regulation Regarding Derivatives

On October 28, 2020, the Securities and Exchange Commission (the “SEC”) adopted new regulations governing the use of derivatives by registered investment companies (“Rule 18f-4”). The Trusts will be required to implement and comply with Rule 18f-4 by August 19, 2022. Once implemented, Rule 18f-4 will impose limits on the amount of derivatives a fund can enter into, eliminate the asset segregation framework currently used by funds to comply with Section 18 of the 1940 Act, treat derivatives as senior securities and require funds whose use of derivatives is more than a limited specified exposure amount to establish and maintain a comprehensive derivatives risk management program and appoint a derivatives risk manager.

Environmental, Social and Governance (“ESG”) Integration

Although a Trust does not seek to implement a specific ESG, impact or sustainability strategy unless otherwise disclosed, Trust management will consider ESG characteristics as part of the investment process for actively managed Trusts. These considerations will vary depending on a Trust’s particular investment strategies and may include consideration of third-party research as well as consideration of proprietary BlackRock research across the ESG risks and opportunities regarding an issuer. Trust management will consider those ESG characteristics it deems relevant or additive when making investment decisions for a Trust. The ESG characteristics utilized in a Trust’s investment process are anticipated to evolve over time and one or more characteristics may not be relevant with respect to all issuers that are eligible for investment. ESG characteristics are not the sole considerations when making investment decisions for a Trust. Further, investors can differ in their views of what constitutes positive or negative ESG characteristics. As a result, a Trust may invest in issuers that do not reflect the beliefs and values with respect to ESG of any particular investor. ESG considerations may affect a Trust’s exposure to certain companies or industries and a Trust may forego certain investment opportunities. While Trust management views ESG considerations as having the potential to contribute to a Trust’s long-term performance, there is no guarantee that such results will be achieved.

Dividend Policy

Each Trust’s dividend policy is to distribute all or a portion of its net investment income to its shareholders on a monthly basis. In order to provide shareholders with a more stable level of distributions, the Trusts may at times pay out less than the entire amount of net investment income earned in any particular month and may at times in any particular month pay out such accumulated but undistributed income in addition to net investment income earned in that month. As a result, the distributions paid by the Trusts for any particular month may be more or less than the amount of net investment income earned by the Trusts during such month. The Trusts’ current accumulated but undistributed net investment income, if any, is disclosed as accumulated earnings (loss) in the Statements of Assets and Liabilities, which comprises part of the financial information included in this report.

General Information

The Trusts do not make available copies of their Statements of Additional Information because the Trusts’ shares are not continuously offered, which means that the Statement of Additional Information of each Trust has not been updated after completion of the respective Trust’s offerings and the information contained in each Trust’s Statement of Additional Information may have become outdated.

The following information is a summary of certain changes since July 31, 2020. This information may not reflect all of the changes that have occurred since you purchased the relevant Trust.

 

 

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Additional Information  (continued)

 

General Information (continued)

Except if noted otherwise herein, there were no changes to the Trusts’ charters or by-laws that would delay or prevent a change of control of the Trusts that were not approved by the shareholders. Except if noted otherwise herein, there have been no changes in the persons who are primarily responsible for the day-to-day management of the Trusts’ portfolios.

In accordance with Section 23(c) of the Investment Company Act of 1940, each Trust may from time to time purchase shares of its common stock in the open market or in private transactions.

Quarterly performance, semi-annual and annual reports, current net asset value and other information regarding the Trusts may be found on BlackRock’s website, which can be accessed at blackrock.com. Any reference to BlackRock’s website in this report is intended to allow investors public access to information regarding the Trusts and does not, and is not intended to, incorporate BlackRock’s website in this report.

Electronic Delivery

Shareholders can sign up for e-mail notifications of quarterly statements, annual and semi-annual shareholder reports by enrolling in the electronic delivery program. Electronic copies of shareholder reports are available on BlackRock’s website.

To enroll in electronic delivery:

Shareholders Who Hold Accounts with Investment Advisers, Banks or Brokerages:

Please contact your financial adviser. Please note that not all investment advisers, banks or brokerages may offer this service.

Householding

The Trusts will mail only one copy of shareholder documents, annual and semi-annual reports, Rule 30e-3 notices and proxy statements, to shareholders with multiple accounts at the same address. This practice is commonly called “householding” and is intended to reduce expenses and eliminate duplicate mailings of shareholder documents. Mailings of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the mailing of these documents to be combined with those for other members of your household, please call the Trusts at (800) 882-0052.

Availability of Quarterly Schedule of Investments

The Trusts file their complete schedules of portfolio holdings with the SEC for the first and third quarters of each fiscal year as an exhibit to their reports on Form N-PORT. The Trusts’ Forms N-PORT are available on the SEC’s website at sec.gov. Additionally, each Trust makes its portfolio holdings for the first and third quarters of each fiscal year available at blackrock.com/fundreports.

Availability of Proxy Voting Policies, Procedures and Voting Records

A description of the policies and procedures that the Trusts use to determine how to vote proxies relating to portfolio securities and information about how the Trusts voted proxies relating to securities held in the Trusts’ portfolios during the most recent 12-month period ended June 30 is available without charge, upon request (1) by calling (800) 882-0052; (2) on the BlackRock website at blackrock.com; and (3) on the SEC’s website at sec.gov.

Availability of Trust Updates

BlackRock will update performance and certain other data for the Trusts on a monthly basis on its website in the “Closed-end Funds” section of blackrock.com as well as certain other material information as necessary from time to time. Investors and others are advised to check the website for updated performance information and the release of other material information about the Trusts. This reference to BlackRock’s website is intended to allow investors public access to information regarding the Trusts and does not, and is not intended to, incorporate BlackRock’s website in this report.

BlackRock Privacy Principles

BlackRock is committed to maintaining the privacy of its current and former fund investors and individual clients (collectively, “Clients”) and to safeguarding their non-public personal information. The following information is provided to help you understand what personal information BlackRock collects, how we protect that information and why in certain cases we share such information with select parties.

If you are located in a jurisdiction where specific laws, rules or regulations require BlackRock to provide you with additional or different privacy-related rights beyond what is set forth below, then BlackRock will comply with those specific laws, rules or regulations.

BlackRock obtains or verifies personal non-public information from and about you from different sources, including the following: (i) information we receive from you or, if applicable, your financial intermediary, on applications, forms or other documents; (ii) information about your transactions with us, our affiliates, or others; (iii) information we receive from a consumer reporting agency; and (iv) from visits to our websites.

 

 

D D I T I O N A L    N F O R M A T  I O N

  79


Additional Information  (continued)

 

BlackRock Privacy Principles (continued)

BlackRock does not sell or disclose to non-affiliated third parties any non-public personal information about its Clients, except as permitted by law or as is necessary to respond to regulatory requests or to service Client accounts. These non-affiliated third parties are required to protect the confidentiality and security of this information and to use it only for its intended purpose.

We may share information with our affiliates to service your account or to provide you with information about other BlackRock products or services that may be of interest to you. In addition, BlackRock restricts access to non-public personal information about its Clients to those BlackRock employees with a legitimate business need for the information. BlackRock maintains physical, electronic and procedural safeguards that are designed to protect the non-public personal information of its Clients, including procedures relating to the proper storage and disposal of such information.

Trust and Service Providers

Investment Adviser

BlackRock Advisors, LLC

Wilmington, DE 19809

Accounting Agent and Custodian

State Street Bank and Trust Company

Boston, MA 02111

Transfer Agent

Computershare Trust Company, N.A.

Canton, MA 02021

VRDP Liquidity Provider

Bank of America, N.A.

New York, NY 10036

VRDP Remarketing Agent

BofA Securities, Inc.

New York, NY 10036

VRDP Tender and Paying Agent, VMTP Redemption and Paying Agent and RVMTP Tender and Paying Agent

The Bank of New York Mellon

New York, NY 10286

Independent Registered Public Accounting Firm

Deloitte & Touche LLP

Boston, MA 02116

Legal Counsel

Willkie Farr & Gallagher LLP

New York, NY 10019

Address of the Trusts

100 Bellevue Parkway

Wilmington, DE 19809

 

 

 

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Glossary of Terms Used in this Report

 

Portfolio Abbreviation
AGC    Assured Guaranty Corp.
AGM    Assured Guaranty Municipal Corp.
AGM-CR    AGM Insured Custodial Receipt
AMBAC    AMBAC Assurance Corp.
AMT    Alternative Minimum Tax
ARB    Airport Revenue Bonds
BAM    Build America Mutual Assurance Co.
CAB    Capital Appreciation Bonds
COP    Certificates of Participation
FHA    Federal Housing Administration
FHLMC    Federal Home Loan Mortgage Corp.
FNMA    Federal National Mortgage Association
GNMA    Government National Mortgage Association
GO    General Obligation Bonds
GTD    GTD Guaranteed
M/F    Multi-Family
NPFGC    National Public Finance Guarantee Corp.
PSF    Permanent School Fund
RB    Revenue Bond
S/F    Single-Family
SAB    Special Assessment Bonds
SAP    Subject to Appropriations
SAW    State Aid Withholding
SONYMA    State of New York Mortgage Agency
ST    Special Tax
TA    Tax Allocation

 

 

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Want to know more?

blackrock.com | 800-882-0052

This report is intended for current holders. It is not a prospectus. Past performance results shown in this report should not be considered a representation of future performance. The Trusts have leveraged their Common Shares, which creates risks for Common Shareholders, including the likelihood of greater volatility of NAV and market price of the Common Shares, and the risk that fluctuations in short-term interest rates may reduce the Common Shares’ yield. Statements and other information herein are as dated and are subject to change.

CEF-07/21-AR

 

 

LOGO

   LOGO


(b) Not Applicable


Item 2 –

Code of Ethics – The registrant (or the “Fund”) has adopted a code of ethics, as of the end of the period covered by this report, applicable to the registrant’s principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions. During the period covered by this report, the code of ethics was amended to update certain information and to make other non-material changes. During the period covered by this report, there have been no waivers granted under the code of ethics. The registrant undertakes to provide a copy of the code of ethics to any person upon request, without charge, who calls 1-800-882-0052, option 4.

 

Item 3 –

Audit Committee Financial Expert – The registrant’s board of directors (the “board of directors”), has determined that (i) the registrant has the following audit committee financial experts serving on its audit committee and (ii) each audit committee financial expert is independent:

Michael Castellano

Frank J. Fabozzi

Catherine A. Lynch

Karen P. Robards

The registrant’s board of directors has determined that Karen P. Robards qualifies as an audit committee financial expert pursuant to Item 3(c)(4) of Form N-CSR.

Ms. Robards has a thorough understanding of generally accepted accounting principles, financial statements and internal control over financial reporting as well as audit committee functions. Ms. Robards has been President of Robards & Company, a financial advisory firm, since 1987. Ms. Robards was formerly an investment banker for more than 10 years where she was responsible for evaluating and assessing the performance of companies based on their financial results. Ms. Robards has over 30 years of experience analyzing financial statements. She also is a member of the audit committee of one publicly held company and a non-profit organization.

Under applicable securities laws, a person determined to be an audit committee financial expert will not be deemed an “expert” for any purpose, including without limitation for the purposes of Section 11 of the Securities Act of 1933, as a result of being designated or identified as an audit committee financial expert. The designation or identification of a person as an audit committee financial expert does not impose on such person any duties, obligations, or liabilities greater than the duties, obligations, and liabilities imposed on such person as a member of the audit committee and board of directors in the absence of such designation or identification. The designation or identification of a person as an audit committee financial expert does not affect the duties, obligations, or liability of any other member of the audit committee or board of directors.

 

Item 4 –

Principal Accountant Fees and Services

The following table presents fees billed by Deloitte & Touche LLP (“D&T”) in each of the last two fiscal years for the services rendered to the Fund:

 

2


     (a) Audit Fees    (b) Audit-Related Fees1    (c) Tax Fees2    (d) All Other Fees
Entity Name   Current
Fiscal Year
End
   Previous
Fiscal Year  
End
   Current
Fiscal Year  
End
   Previous
Fiscal Year  
End
   Current
Fiscal Year  
End
   Previous
Fiscal Year  
End
   Current
Fiscal Year  
End
   Previous
Fiscal Year  
End
BlackRock California Municipal Income Trust   $30,805    $31,722    $207    $0    $14,500    $14,500    $0    $0

The following table presents fees billed by D&T that were required to be approved by the registrant’s audit committee (the “Committee”) for services that relate directly to the operations or financial reporting of the Fund and that are rendered on behalf of BlackRock Advisors, LLC (“Investment Adviser” or “BlackRock”) and entities controlling, controlled by, or under common control with BlackRock (not including any sub-adviser whose role is primarily portfolio management and is subcontracted with or overseen by another investment adviser) that provide ongoing services to the Fund (“Affiliated Service Providers”):

 

      Current Fiscal Year End    Previous Fiscal Year End

(b) Audit-Related Fees1

   $0    $0

(c) Tax Fees2

   $0    $0

(d) All Other Fees3

   $2,032,000    $1,984,000

1 The nature of the services includes assurance and related services reasonably related to the performance of the audit or review of financial statements not included in Audit Fees, including accounting consultations, agreed-upon procedure reports, attestation reports, comfort letters, out-of-pocket expenses and internal control reviews not required by regulators.

2 The nature of the services includes tax compliance and/or tax preparation, including services relating to the filing or amendment of federal, state or local income tax returns, regulated investment company qualification reviews, taxable income and tax distribution calculations.

3 Non-audit fees of $2,032,000 and $1,984,000 for the current fiscal year and previous fiscal year, respectively, were paid to the Fund’s principal accountant in their entirety by BlackRock, in connection with services provided to the Affiliated Service Providers of the Fund and of certain other funds sponsored and advised by BlackRock or its affiliates for a service organization review and an accounting research tool subscription. These amounts represent aggregate fees paid by BlackRock and were not allocated on a per fund basis.

(e)(1) Audit Committee Pre-Approval Policies and Procedures:

The Committee has adopted policies and procedures with regard to the pre-approval of services. Audit, audit-related and tax compliance services provided to the registrant on an annual basis require specific pre-approval by the Committee. The Committee also must approve other non-audit services provided to the registrant and those non-audit services provided to the Investment Adviser and Affiliated Service Providers that relate directly to the operations and the financial reporting of the registrant. Certain of these non-audit services that the Committee believes are (a) consistent with the SEC’s auditor independence rules and (b) routine and recurring services that will not impair the independence of the independent accountants may be approved by the Committee without consideration on a specific case-by-case basis (“general pre-approval”). The term of any general pre-approval is 12 months from the date of the pre-approval, unless the Committee provides for a different period. Tax or other non-audit services provided to the registrant which have a direct impact on the operations or financial reporting of the registrant will only be deemed pre-approved provided that any individual project does not exceed $10,000 attributable to the registrant or $50,000 per project. For this purpose, multiple projects will be aggregated to determine if they exceed the previously mentioned cost levels.

Any proposed services exceeding the pre-approved cost levels will require specific pre-approval by the Committee, as will any other services not subject to general pre-approval (e.g., unanticipated but permissible services). The Committee is informed of each service approved

 

3


subject to general pre-approval at the next regularly scheduled in-person board meeting. At this meeting, an analysis of such services is presented to the Committee for ratification. The Committee may delegate to the Committee Chairman the authority to approve the provision of and fees for any specific engagement of permitted non-audit services, including services exceeding pre-approved cost levels.

(e)(2) None of the services described in each of Items 4(b) through (d) were approved by the Committee pursuant to the de minimis exception in paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X.

(f) Not Applicable

(g) The aggregate non-audit fees, defined as the sum of the fees shown under “Audit-Related Fees,” “Tax Fees” and “All Other Fees,” paid to the accountant for services rendered by the accountant to the registrant, the Investment Adviser and the Affiliated Service Providers were:

 

Entity Name    Current Fiscal Year    
End    
     Previous Fiscal Year     
End    
                           
BlackRock California Municipal Income Trust    $14,707    $14,500   

Additionally, the amounts billed by D&T in connection with services provided to the Affiliated Service Providers of the Fund and of other funds sponsored or advised by BlackRock or its affiliates during the current and previous fiscal years for a service organization review and an accounting research tool subscription were:

 

Current Fiscal  
Year End  
  Previous Fiscal  
Year End  
$2,032,000   $1,984,000

These amounts represent aggregate fees paid by BlackRock and were not allocated on a per fund basis.

(h) The Committee has considered and determined that the provision of non-audit services that were rendered to the Investment Adviser, and the Affiliated Service Providers that were not pre-approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X is compatible with maintaining the principal accountant’s independence.

 

Item 5 –

Audit Committee of Listed Registrant

 

  (a)

The following individuals are members of the registrant’s separately designated standing audit committee established in accordance with Section 3(a)(58)(A) of the Securities Exchange Act of 1934 (15 U.S.C. 78c(a)(58)(A)):

Michael Castellano

Frank J. Fabozzi

J. Phillip Holloman

Catherine A. Lynch

Karen P. Robards

 

4


(b) Not Applicable

 

Item 6 –

Investments

(a) The registrant’s Schedule of Investments is included as part of the Report to Stockholders filed under Item 1(a) of this Form.

(b) Not Applicable due to no such divestments during the semi-annual period covered since the previous Form N-CSR filing.

 

Item 7 –

Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies – The board of directors has delegated the voting of proxies for the Fund’s portfolio securities to the Investment Adviser pursuant to the Investment Adviser’s proxy voting guidelines. Under these guidelines, the Investment Adviser will vote proxies related to Fund securities in the best interests of the Fund and its stockholders. From time to time, a vote may present a conflict between the interests of the Fund’s stockholders, on the one hand, and those of the Investment Adviser, or any affiliated person of the Fund or the Investment Adviser, on the other. In such event, provided that the Investment Adviser’s Equity Investment Policy Oversight Committee, or a sub-committee thereof (the “Oversight Committee”) is aware of the real or potential conflict or material non-routine matter and if the Oversight Committee does not reasonably believe it is able to follow its general voting guidelines (or if the particular proxy matter is not addressed in the guidelines) and vote impartially, the Oversight Committee may retain an independent fiduciary to advise the Oversight Committee on how to vote or to cast votes on behalf of the Investment Adviser’s clients. If the Investment Adviser determines not to retain an independent fiduciary, or does not desire to follow the advice of such independent fiduciary, the Oversight Committee shall determine how to vote the proxy after consulting with the Investment Adviser’s Portfolio Management Group and/or the Investment Adviser’s Legal and Compliance Department and concluding that the vote cast is in its client’s best interest notwithstanding the conflict. A copy of the Fund’s Proxy Voting Policy and Procedures are attached as Exhibit 99.PROXYPOL, a copy of the Fund’s Global Corporate Governance  & Engagement Principles are attached as Exhibit 99.GLOBAL.CORP.GOV and a copy of the Fund’s Corporate Governance and Proxy Voting Guidelines for U.S. Securities are attached as Exhibit 99.US.CORP.GOV. Information on how the Fund voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is available without charge, (i) at www.blackrock.com and (ii) on the SEC’s website at http://www.sec.gov.

 

Item 8 –

Portfolio Managers of Closed-End Management Investment Companies

(a)(1) As of the date of filing this Report:

The registrant is managed by a team of investment professionals comprised of Theodore R. Jaeckel, Jr., CFA, Managing Director at BlackRock, Walter O’Connor, CFA, Managing Director at BlackRock and Michael Perilli, Director at BlackRock. Each is a member of BlackRock’s municipal tax-exempt management group. Each is jointly responsible for the day-to-day management of the registrant’s portfolio, which includes setting the registrant’s overall investment strategy, overseeing the management of the registrant and/or selection of its investments. Messrs. Jaeckel and O’Connor have been members of the registrant’s

 

5


portfolio management team since 2006. Mr. Perilli has been a member of the Fund’s portfolio management team since 2018.

 

 Portfolio Manager    Biography

 Theodore R. Jaeckel, Jr., CFA

  

Managing Director of BlackRock since 2006; Managing Director of Merrill Lynch Investment Managers, L.P. (“MLIM”) from 2005 to 2006; Director of MLIM from 1997 to 2005.

 Walter O’Connor, CFA

  

Managing Director of BlackRock since 2006; Managing Director of MLIM from 2003 to 2006; Director of MLIM from 1998 to 2003.

 Michael Perilli

  

Director of BlackRock since 2021; Vice President of BlackRock from 2017 to 2020; Associate of BlackRock from 2008 to 2016.

(a)(2) As of July 31, 2021:

 

    

(ii) Number of Other Accounts Managed

and Assets by Account Type

 

(iii) Number of Other Accounts and

Assets for Which Advisory Fee is

Performance-Based

(i) Name of

Portfolio Manager

 

Other

Registered

Investment

Companies

 

Other
Pooled

Investment

Vehicles

 

Other

Accounts

 

Other

Registered

Investment

Companies

 

Other
Pooled

Investment

Vehicles

 

Other

Accounts

Theodore R. Jaeckel, Jr., CFA

  23   0   0   0   0   0
    $28.12 Billion   $0   $0   $0   $0   $0

Walter O’Connor, CFA

  22   0   0   0   0   0
    $33.52 Billion   $0   $0   $0   $0   $0

Michael Perilli

  14   0   0   0   0   0
    $7.50 Billion   $0   $0   $0   $0   $0

(iv)  Portfolio Manager Potential Material Conflicts of Interest

BlackRock has built a professional working environment, firm-wide compliance culture and compliance procedures and systems designed to protect against potential incentives that may favor one account over another. BlackRock has adopted policies and procedures that address the allocation of investment opportunities, execution of portfolio transactions, personal trading by employees and other potential conflicts of interest that are designed to ensure that all client accounts are treated equitably over time. Nevertheless, BlackRock furnishes investment management and advisory services to numerous clients in addition to the Fund, and BlackRock may, consistent with applicable law, make investment recommendations to other clients or accounts (including accounts which are hedge funds or have performance or higher fees paid to BlackRock, or in which portfolio managers have a personal interest in the receipt of such fees), which may be the same as or different from those made to the Fund. In addition, BlackRock, Inc., its affiliates and significant shareholders and any officer, director, shareholder or employee may or may not have an interest in the securities whose purchase and sale BlackRock recommends to the Fund. BlackRock, Inc., or any of its affiliates or significant shareholders, or any officer, director, shareholder, employee or any member of their families may take different actions than those recommended to the Fund by BlackRock with respect to the same securities. Moreover, BlackRock may refrain from rendering any advice or services concerning securities of

 

6


companies of which any of BlackRock, Inc.’s (or its affiliates’ or significant shareholders’) officers, directors or employees are directors or officers, or companies as to which BlackRock, Inc. or any of its affiliates or significant shareholders or the officers, directors and employees of any of them has any substantial economic interest or possesses material non-public information. Certain portfolio managers also may manage accounts whose investment strategies may at times be opposed to the strategy utilized for a fund. It should also be noted that a portfolio manager may be managing hedge fund and/or long only accounts, or may be part of a team managing hedge fund and/or long only accounts, subject to incentive fees. Such portfolio managers may therefore be entitled to receive a portion of any incentive fees earned on such accounts. Currently, the portfolio managers of this Fund are not entitled to receive a portion of incentive fees of other accounts.

As a fiduciary, BlackRock owes a duty of loyalty to its clients and must treat each client fairly. When BlackRock purchases or sells securities for more than one account, the trades must be allocated in a manner consistent with its fiduciary duties. BlackRock attempts to allocate investments in a fair and equitable manner among client accounts, with no account receiving preferential treatment. To this end, BlackRock, Inc. has adopted policies that are intended to ensure reasonable efficiency in client transactions and provide BlackRock with sufficient flexibility to allocate investments in a manner that is consistent with the particular investment discipline and client base, as appropriate.

(a)(3) As of July 31, 2021:

Portfolio Manager Compensation Overview

The discussion below describes the portfolio managers’ compensation as of July 31, 2021.

BlackRock’s financial arrangements with its portfolio managers, its competitive compensation and its career path emphasis at all levels reflect the value senior management places on key resources. Compensation may include a variety of components and may vary from year to year based on a number of factors. The principal components of compensation include a base salary, a performance-based discretionary bonus, participation in various benefits programs and one or more of the incentive compensation programs established by BlackRock.

Base Compensation. Generally, portfolio managers receive base compensation based on their position with the firm.

Discretionary Incentive Compensation. Discretionary incentive compensation is a function of several components: the performance of BlackRock, Inc., the performance of the portfolio manager’s group within BlackRock, the investment performance, including risk-adjusted returns, of the firm’s assets under management or supervision by that portfolio manager relative to predetermined benchmarks, and the individual’s performance and contribution to the overall performance of these portfolios and BlackRock. In most cases, these benchmarks are the same as the benchmark or benchmarks against which the performance of the Funds or other accounts managed by the portfolio managers are measured. Among other things, BlackRock’s Chief Investment Officers make a subjective determination with respect to each portfolio manager’s compensation based on the performance of the Funds and other accounts managed by each portfolio

 

7


manager relative to the various benchmarks. Performance of fixed income funds is measured on a pre-tax and/or after-tax basis over various time periods including 1-, 3- and 5- year periods, as applicable. With respect to these portfolio managers, such benchmarks for the Fund and other accounts are: a combination of market-based indices (e.g., Standard & Poor’s Municipal Bond Index), certain customized indices and certain fund industry peer groups.

Distribution of Discretionary Incentive Compensation. Discretionary incentive compensation is distributed to portfolio managers in a combination of cash, deferred BlackRock, Inc. stock awards, and/or deferred cash awards that notionally track the return of certain BlackRock investment products.

Portfolio managers receive their annual discretionary incentive compensation in the form of cash. Portfolio managers whose total compensation is above a specified threshold also receive deferred BlackRock, Inc. stock awards annually as part of their discretionary incentive compensation. Paying a portion of discretionary incentive compensation in the form of deferred BlackRock, Inc. stock puts compensation earned by a portfolio manager for a given year “at risk” based on BlackRock’s ability to sustain and improve its performance over future periods. In some cases, additional deferred BlackRock, Inc. stock may be granted to certain key employees as part of a long-term incentive award to aid in retention, align interests with long-term shareholders and motivate performance. Deferred BlackRock, Inc. stock awards are generally granted in the form of BlackRock, Inc. restricted stock units that vest pursuant to the terms of the applicable plan and, once vested, settle in BlackRock, Inc. common stock. The portfolio managers of this Fund have deferred BlackRock, Inc. stock awards.

For certain portfolio managers, a portion of the discretionary incentive compensation is also distributed in the form of deferred cash awards that notionally track the returns of select BlackRock investment products they manage, which provides direct alignment of portfolio manager discretionary incentive compensation with investment product results. Deferred cash awards vest ratably over a number of years and, once vested, settle in the form of cash. Only portfolio managers who manage specified products and whose total compensation is above a specified threshold are eligible to participate in the deferred cash award program.

Other Compensation Benefits. In addition to base salary and discretionary incentive compensation, portfolio managers may be eligible to receive or participate in one or more of the following:

Incentive Savings Plans – BlackRock, Inc. has created a variety of incentive savings plans in which BlackRock, Inc. employees are eligible to participate, including a 401(k) plan, the BlackRock Retirement Savings Plan (RSP), and the BlackRock Employee Stock Purchase Plan (ESPP). The employer contribution components of the RSP include a company match equal to 50% of the first 8% of eligible pay contributed to the plan capped at $5,000 per year, and a company retirement contribution equal to 3-5% of eligible compensation up to the Internal Revenue Service limit ($290,000 for 2021). The RSP offers a range of investment options, including registered investment companies and collective investment funds managed by the firm. BlackRock, Inc. contributions follow the investment direction set by participants for their own contributions or, absent participant investment direction, are invested into a target date fund that corresponds to, or is closest to, the year in which the participant attains age 65. The ESPP allows for investment in

 

8


BlackRock, Inc. common stock at a 5% discount on the fair market value of the stock on the purchase date. Annual participation in the ESPP is limited to the purchase of 1,000 shares of common stock or a dollar value of $25,000 based on its fair market value on the purchase date. All of the eligible portfolio managers are eligible to participate in these plans.

(a)(4) Beneficial Ownership of Securities – As of July 31, 2021.

 

Portfolio Manager    Dollar Range of Equity Securities
of the Fund Beneficially Owned

Theodore R. Jaeckel, Jr., CFA

   None

Walter O’Connor, CFA

   None

Michael Perilli

   None

(b) Not Applicable

 

Item 9 –

Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers – Not Applicable due to no such purchases during the period covered by this report.

 

Item 10 –

Submission of Matters to a Vote of Security Holders – There have been no material changes to these procedures.

 

Item 11 –

Controls and Procedures

(a) The registrant’s principal executive and principal financial officers, or persons performing similar functions, have concluded that the registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended (the “1940 Act”)) are effective as of a date within 90 days of the filing of this report based on the evaluation of these controls and procedures required by Rule 30a-3(b) under the 1940 Act and Rule 13a-15(b) under the Securities Exchange Act of 1934, as amended.

(b) There were no changes in the registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act) that occurred during the period covered by this report that have materially affected, or are reasonably likely to materially affect, the registrant’s internal control over financial reporting.

 

Item 12 –

Disclosure of Securities Lending Activities for Closed-End Management Investment Companies –Not Applicable

 

Item 13 –

Exhibits attached hereto

(a)(1) Code of Ethics – See Item 2

(a)(2) Section 302 Certifications are attached

(a)(3) Not Applicable

 

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(a)(4) Not Applicable

(b) Section 906 Certifications are attached

 

 

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Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

BlackRock California Municipal Income Trust

 

 

By:

    

/s/ John M. Perlowski                            

      

John M. Perlowski

      

Chief Executive Officer (principal executive officer) of

      

BlackRock California Municipal Income Trust

Date: October 4, 2021

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

 

 

By:

    

/s/ John M. Perlowski                            

      

John M. Perlowski

      

Chief Executive Officer (principal executive officer) of

      

BlackRock California Municipal Income Trust

Date: October 4, 2021

 

 

By:

    

/s/ Trent Walker                            

      

Trent Walker

      

Chief Financial Officer (principal financial officer) of

      

BlackRock California Municipal Income Trust

Date: October 4, 2021

 

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