			1933 Act No. 333-42181 1940 Act No. 811-08555

SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933				[ ]
		Pre-Effective Amendment No.		[ ]
		Post-Effective Amendment No. 21		[X]

and/or

REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940				[ ]
		Amendment No. 22		[X]

	EVERGREEN MONEY MARKET TRUST
	(Exact Name of Registrant as Specified in Charter)
	200 Berkeley Street, Boston, Massachusetts 02116-5034
	(Address of Principal Executive Offices)
	(617) 210-3200
	(Registrant's Telephone Number)

	The Corporation Trust Company
	1209 Orange Street
	Wilmington, Delaware 19801
	(Name and Address of Agent for Service)

It is proposed that this filing will become effective:
[ ] immediately upon filing pursuant to paragraph (b)
[X] on May 25, 2005 pursuant to paragraph (b)
[ ] 60 days after filing pursuant to paragraph (a)(i)
[ ] on (date) pursuant to paragraph (a)(i)
[ ] 75 days after filing pursuant to paragraph (a)(ii)
[ ] on (date) pursuant to paragraph (a)(ii) of Rule 485

If appropriate, check the following box:

[ ] this post-effective amendment designates a new effective date for a
previously filed post-effective amendment

EVERGREEN MONEY MARKET TRUST

CONTENTS OF

POST-EFFECTIVE AMENDMENT NO. 21

TO

REGISTRATION STATEMENT ON FORM N-1A

This Post-Effective Amendment No. 21 to Registrant's Registration Statement
No. 333-42181/811-08555 consists of the following pages, items of information and documents:

The Facing Sheet

PART A
----------

Prospectus for Classes A, B, C and I shares of Evergreen California Municipal
Money Market Fund, Evergreen Florida Municipal Money Market Fund, Evergreen
Money Market Fund, Evergreen Municipal Money Market Fund, Evergreen New Jersey
Municipal Money Market Fund, Evergreen New York Municipal Money Market Fund,
Evergreen Pennsylvania Municipal Money Market Fund, Evergreen Treasury Money
Market Fund and Evergreen U.S. Government Money Market Fund, as supplemented from
time to time, is contained herein.

Prospectus for Classes S and S1 shares of Evergreen California Municipal Money
Market Fund, Evergreen Florida Municipal Money Market Fund, Evergreen Money
Market Fund, Evergreen Municipal Money Market Fund, Evergreen New Jersey
Municipal Money Market Fund, Evergreen New York Municipal Money Market Fund,
Evergreen Pennsylvania Municipal Money Market Fund, Evergreen Treasury Money
Market Fund and Evergreen U.S. Government Money Market Fund, as supplemented from
time to time, is contained herein.

Prospectus for Class A shares of Evergreen California Municipal Money Market
Fund, Evergreen Money Market Fund, Evergreen Municipal Money Market Fund,
Evergreen New York Municipal Money Market Fund and Evergreen U.S. Government
Money Market Fund, as supplemented from time to time, is contained herein.

Prospectus for Class S shares of Evergreen California Municipal Money Market
Fund, Evergreen Florida Municipal Money Market Fund, Evergreen Money Market
Fund, Evergreen Municipal Money Market Fund, Evergreen New Jersey Municipal
Money Market Fund, Evergreen New York Municipal Money Market Fund, Evergreen
Pennsylvania Municipal Money Market Fund and Evergreen Treasury Money Market Fund, as
supplemented from time to time, is contained herein.

PART B
----------

Statement of Additional Information for Evergreen California Municipal Money
Market Fund, Evergreen Florida Municipal Money Market Fund, Evergreen Money
Market Fund, Evergreen Municipal Money Market Fund, Evergreen New Jersey
Municipal Money Market Fund, Evergreen New York Municipal Money Market Fund,
Evergreen Pennsylvania Municipal Money Market Fund, Evergreen Treasury Money
Market Fund and Evergreen US Government Money Market Fund, as supplemented from
time to time, is contained herein.

PART C
---------

Exhibits
Persons Controlled by or Under Common Control with Registrant
Indemnification
Business and Other Connections of Investment Advisor
Principal Underwriter
Location of Accounts and Records
Management Services
Undertakings
Notice
Signatures

EVERGREEN MONEY MARKET TRUST

PART A

CLASS A PROSPECTUS

Prospectus, June 1, 2005

Evergreen
Money Market Funds

Evergreen California Municipal Money Market Fund
Evergreen Money Market Fund
Evergreen Municipal Money Market Fund
Evergreen New York Municipal Money Market Fund
Evergreen U.S. Government Money Market Fund

Class A

The Securities and Exchange Commission has not determined that the information in this prospectus is accurate or complete, nor has it approved or disapproved these securities. Anyone who tells you otherwise is committing a crime.

FUND RISK/RETURN SUMMARIES:

Overview of Fund Risks
Evergreen California Municipal Money Market Fund
Evergreen Money Market Fund
Evergreen Municipal Money Market Fund
Evergreen New York Municipal Money Market Fund
Evergreen U.S. Government Money Market Fund

GENERAL INFORMATION:

The Funds' Investment Advisor
Calculating the Share Price
How to Choose an Evergreen Fund
How to Choose the Share Class That Best Suits You
How to Buy Shares
How to Redeem Shares
Other Services
The Tax Consequences of Investing in the Funds
More Information about the Funds' Fees and Expenses
Financial Highlights
Other Fund Practices
Fund Governance
Fund Operating Policies and Procedures

In general,

the Funds included in this prospectus provide investors with a selection of investment alternatives which seek a high rate of current income consistent with stability of principal and liquidity. Evergreen Municipal Money Market Fund also seeks current income which is exempt from regular federal income tax and Evergreen California Municipal Money Market Fund and Evergreen New York Municipal Money Market Fund also seek current income which is exempt from regular federal income tax and, generally, applicable state taxes.

Fund Summaries Key

Each Fund's summary is organized around the following basic topics and questions:

INVESTMENT GOAL

What is the Fund's financial objective? You can find clarification on how the Fund seeks to achieve its objective by looking at the Fund's strategy and investment policies. The Fund's Board of Trustees can change the investment objective without a shareholder vote.

INVESTMENT STRATEGY

How does the Fund go about trying to meet its goals? What types of investments does it contain? What style of investing and investment philosophy does it follow? Does it have limits on the amount invested in any particular type of security?

RISK FACTORS

What are the specific risks for an investor in the Fund?

PERFORMANCE

How well has the Fund performed in the past year? The past five years? The past ten years?

FEES AND EXPENSES

How much does it cost to invest in the Fund?

Overview of Fund Risks

Money Market Funds

typically rely on a combination of the following strategies:

attempting to maintain $1.00 per share net asset value;
investing in high quality, short-term money market instruments, including U.S. government securities;
investing in compliance with industry-standard requirements for money market funds for the quality, maturity and diversification of investments; and
selling a portfolio investment: i) when a portfolio manager believes the issuer's investment fundamentals begin to deteriorate; ii) to take advantage of yield opportunities; iii) when the investment no longer appears to meet the Fund's investment objective; iv) when the Fund must meet redemptions; or v) for other investment reasons which a portfolio manager deems appropriate.

may be appropriate for investors who:

are seeking a conservative investment which invests in relatively safe securities;
are seeking a fund for short-term investment; and
are seeking liquidity.

Following this overview, you will find information on each Fund's specific investment strategies and risks.

Although the Funds seek to preserve the value of your investment at $1.00 per share, it is possible to lose money by investing in the Funds.

Risk Factors For All Mutual Funds

Please remember that an investment in a mutual fund is:

not guaranteed to achieve its investment goal;
not a deposit with a bank;
not insured, endorsed or guaranteed by the FDIC or any government agency; and
subject to investment risks.

The following are some of the most important factors that may affect the value of your investment. Other factors may be described in the discussion following this overview.

Interest Rate Risk

When interest rates go up, the value of debt securities tends to fall. Since the Fund invests a significant portion of its portfolio in debt securities, if interest rates rise, then the value of the Fund's investments in debt securities and its yield may decline. If interest rates go down, interest earned by the Fund on its debt investments may also decline, which could cause the Fund to reduce the dividends it pays. The longer the term of a debt security held by the Fund, the more the Fund is subject to interest rate risk.

Credit Risk

The value of a debt security is directly affected by the issuer's ability to repay principal and pay interest on time. Since the Fund invests in debt securities, the value of the Fund's investments in debt securities and its yield may decline if an issuer fails to pay an obligation on a timely basis. The Fund may also be subject to credit risk to the extent it engages in transactions, such as repurchase agreements, which involve a promise by a third party to honor an obligation to the Fund. Such third party may be unwilling or unable to honor its financial obligations.

Concentration Risk

An investment in a fund that concentrates its investments in a single state entails greater risk than an investment in a fund that invests its assets in numerous states. A Fund may be vulnerable to any development in its named state’s economy that may weaken or jeopardize the ability of the state’s municipal security issuers to pay interest or principal on their debt obligations.

Non-Diversification Risk

An investment in a fund that is non-diversified entails greater risk than an investment in a diversified fund. When a fund is non-diversified, it may invest a greater percentage of assets in a single issuer than may be invested by a diversified fund. A higher percentage of investments among fewer issuers may result in greater fluctuation in the total market value of the Fund’s portfolio than in a fund which invests in numerous issuers.

California Municipal Money Market Fund

FUND FACTS:

Goals:

· High Current Income Exempt from Federal and California State Income Taxes

· Preservation of Capital

· Liquidity

Principal Investment:

· Municipal Money Market Securities

Class of Shares Offered in this Prospectus:

· Class A

Investment Advisor:

· Evergreen
Investment
Management
Company, LLC

NASDAQ Symbol:

· ECMXX

Dividend Payment Schedule:

· Monthly

INVESTMENT GOAL

The Fund seeks as high a level of current income exempt from regular federal income tax and, to the extent possible, from California personal income tax, as is believed to be consistent with preserving capital and providing liquidity.

INVESTMENT STRATEGY

The following supplements the investment strategies discussed in the ''Overview of Fund Risks'' on page 1.

The Fund will normally invest at least 80% of its assets in municipal money market securities issued by the State of California or its political subdivisions, agencies, or instrumentalities, or by other governmental units (such as U.S. territories), the interest from which is exempt from federal income tax other than the federal alternative minimum tax and, to the extent possible, from California personal income tax. Municipal money market securities include fixed, variable or floating rate general obligation and revenue bonds; tax, bond and revenue anticipation notes; and commercial paper obligations. The Fund also invests in tender option bonds, which are demand obligations that bear interest at the prevailing short-term, tax-exempt rate.

The Fund will comply with the diversification requirements prescribed by Rule 2a-7. However, the Fund is non-diversified and therefore may invest a significant percentage of its assets in obligations of a single issuer. In determining which securities to purchase for the portfolio, the portfolio managers focus on the supply and demand of the security in the market place as well as the current interest rate environment.

The Fund may temporarily invest up to 20% of its assets in high-quality, short-term taxable securities under one or more of the following circumstances: (a) pending investment of proceeds from the sale of Fund shares or portfolio securities; (b) pending settlement of purchases of portfolio securities; and (c) to maintain liquidity for the purpose of meeting anticipated redemptions. However, the Fund may temporarily invest up to 100% of its assets in taxable securities for defensive purposes, which may result in the Fund not achieving its investment objective.

RISK FACTORS

Your investment in the Fund is subject to the risks discussed in the ''Overview of Fund Risks'' on page 1 under the headings:

Interest Rate Risk
Credit Risk
Concentration Risk
Non-Diversification Risk

Distributions of capital gains and other taxable income will be subject to tax under California personal income tax. Corporations subject to California corporation franchise tax will generally be subject to tax on all distributions of income from the Fund.

For more information on the factors that could affect the ability of California municipal security issuers to pay interest and principal on securities acquired by the Fund, see “Additional Information Concerning California” in the Statement of Additional Information.

Because the taxable money market is a broader and more liquid market and has a greater number of investors, issuers and market makers than the market for short-term, tax-exempt municipal securities, the liquidity of the Fund may not be equal to that of a money market fund which invests exclusively in short-term taxable money market instruments. The more limited marketability of short-term, tax-exempt municipal securities may make it difficult in certain circumstances to dispose of large investments advantageously.

For further information regarding the Fund's investment strategy and risk factors, see "Other Fund Practices."

PERFORMANCE

The following tables show how the Fund has performed in the past. Past performance is not an indication of future results.

The table below shows the percentage gain for the Class A shares of the Fund in each calendar year since the Class A shares' inception on 9/24/2001. It should give you a general idea of the risks of investing in the Fund. This table includes the effects of Fund expenses.

Year-by-Year Total Return for Class A Shares (%)

1995	1996	1997	1998	1999	2000	2001	2002	2003	2004
							0.93	0.43	0.50

Best Quarter:	4th Quarter 2002	+ 0.26 %
Worst Quarter:	3rd Quarter 2003	+ 0.05 %
Year-to-date total return as of 3/31/2005 is +0.27%.

The next table lists the Fund’s average annual total return for the Class A shares over the past year and since inception. This table is intended to provide you with some indication of the risks of investing in the Fund.

Average Annual Total Return
(for the period ended 12/31/2004)

	Inception Date of Class	1 year	5 year	10 year	Performance Since 9/24/2001
Class A	9/24/2001	0.50 %	N/A	N/A	0.67 %
3 Mo. T-Bill ¹		1.33 %	N/A	N/A	1.51 %

To obtain current yield information call 1.800.343.2898.

FEES AND EXPENSES

This section describes the fees and expenses you would pay if you bought and held shares of the Fund. More detailed information regarding the Shareholder Fees shown in the table below can be found under the sections of this prospectus entitled "How to Choose the Share Class that Best Suits You" and "How to Reduce or Eliminate Your Sales Charge." Annual Fund Operating Expenses are based on the Fund’s fiscal year ended 1/31/2005.

You pay no shareholder transaction fees to the Fund.

Annual Fund Operating Expenses (expenses that are deducted from Fund assets) ²

	Class A
Management Fees	0.45 %
12b-1 Fees	0.30 %
Other Expenses	0.19 %
Total Fund Operating Expenses	0.94 %

2. Restated to reflect current fees.

The table below shows the total fees and expenses you would pay on a $10,000 investment over one-, three-, five- and ten-year periods. The example is intended to help you compare the cost of investing in this Fund versus other mutual funds and is for illustration purposes only. The example assumes a 5% average annual return, reinvestment of all dividends and distributions, and that the Fund's operating expenses are the same as described in the table above. Your actual costs may be higher or lower.

Example of Fund Expenses

After:	Class A
1 year	$ 96
3 years	$ 300
5 years	$ 520
10 years	$ 1,155

Money Market Fund

FUND FACTS:

Goals:

· High Current Income

· Preservation of Capital

· Liquidity

Principal Investments:

· Money Market Instruments

· Short-term Corporate Debt Securities

Class of Shares Offered in this Prospectus:

· Class A

Investment Advisor:

· Evergreen
Investment
Management
Company, LLC

NASDAQ Symbol:

· EMAXX

Dividend Payment Schedule:

· Monthly

INVESTMENT GOAL

The Fund seeks to achieve as high a level of current income as is consistent with preserving capital and providing liquidity.

INVESTMENT STRATEGY

The following supplements the investment strategies discussed in the ''Overview of Fund Risks'' on page 1.

The Fund invests principally in money market securities including short-term corporate debt obligations (such as fixed, variable or floating rate securities), certificates of deposit and bankers' acceptances, commercial paper, municipal securities and repurchase agreements determined to present minimal credit risk.

In addition, the Fund may invest in U.S. Treasury obligations and short-term securities issued or guaranteed by the U.S. government or its agencies or instrumentalities. The Fund may invest up to 30% of its assets in bank obligations such as bank certificates of deposit and bankers' acceptances payable in U.S. dollars and issued by foreign banks (including U.S. branches of foreign banks) or by foreign branches of U.S. banks.

The portfolio managers focus primarily on the interest rate environment in determining which securities to purchase for the portfolio. Generally, in a rising rate environment, the Fund will invest in securities of shorter maturities. If interest rates are high, the Fund will generally invest in securities with longer maturities; however, the Fund will not acquire any security with a remaining maturity of greater than 397 days, unless such security has a maturity shortening feature which reduces the final maturity to no greater than 397 days.

RISK FACTORS

Your investment in the Fund is subject to the risks discussed in the ''Overview of Fund Risks'' on page 1 under the headings:

Interest Rate Risk
Credit Risk

In addition to interest rate risk and credit risk, the Fund is subject to risks associated with obligations of supranational entities, such as the Inter-American Development Bank and the World Bank (formerly known as the International Bank for Reconstruction and Development). Because these entities are not governmental entities with taxing authority, and may be supported only by appropriated but unpaid commitments of member countries, there is no assurance that the commitments will be undertaken in the future.

If the Fund invests in bank certificates of deposit and bankers’ acceptances payable in U.S. dollars and issued by foreign banks (including U.S. branches of foreign banks) or by foreign branches of U.S. banks, it could be exposed to certain unique risks of foreign investing. For example, political turmoil and economic instability in the countries in which the Fund invests could adversely affect the dividend yield, total return earned on and the value of your investment. Certain foreign countries have less developed and less regulated banking systems and accounting systems than the U.S.

For further information regarding the Fund's investment strategy and risk factors, see "Other Fund Practices."

PERFORMANCE

The following tables show how the Fund has performed in the past. Past performance is not an indication of future results.

The table below shows the percentage gain or loss for the Class A shares of the Fund in the last ten calendar years. It should give you a general idea of the risks of investing in the Fund by showing how the Fund's return has varied from year-to-year. This table includes the effects of Fund expenses.

Year-by-Year Total Return for Class A Shares (%)

1995	1996	1997	1998	1999	2000	2001	2002	2003	2004
5.37	4.9	4.99	4.95	4.62	5.8	3.58	1.2	0.36	0.57

Best Quarter:	4th Quarter 2000	+ 1.49 %
Worst Quarter:	3rd Quarter 2003	+ 0.05 %
Year-to-date total return as of 3/31/2005 is +0.40%.

The next table lists the Fund’s average annual total return for the Class A shares over the past one, five and ten years and since inception. This table is intended to provide you with some indication of the risks of investing in the Fund.

Average Annual Total Return
(for the period ended 12/31/2004) ¹

	Inception Date of Class	1 year	5 year	10 year	Performance Since 11/2/1987
Class A	1/4/1995	0.57 %	2.28 %	3.61 %	4.64 %
3 Mo. T-Bill ²		1.33 %	2.95 %	4.14 %	4.92 %

1. Historical performance shown for Class A prior to its inception is based on the performance of Class I, the original class offered. The historical returns for Class A have not been adjusted to reflect the effect of the class' 12b-1 fee. These fees are 0.30% for Class A. Class I does not pay a 12b-1 fee. If these fees had been reflected, returns for Class A would have been lower.

To obtain current yield information call 1.800.343.2898.

FEES AND EXPENSES

You pay no shareholder transaction fees to the Fund.

Annual Fund Operating Expenses (expenses that are deducted from Fund assets) ³

	Class A
Management Fees	0.40 %
12b-1 Fees	0.30 %
Other Expenses	0.30 %
Total Fund Operating Expenses ⁴	1.00 %

3. Restated to reflect current fees.

4. The Fund's investment advisor may voluntarily waive its fees and/or reimburse the Fund for certain of its expenses in order to reduce expense ratios. The Fund's investment advisor may cease these voluntary waivers and/or reimbursements at any time. The Annual Fund Operating Expenses listed above do not reflect voluntary fee waivers and/or expense reimbursements. Including current voluntary fee waivers and/or expense reimbursements, Total Fund Operating Expenses were 0.95% for Class A.

Example of Fund Expenses

After:	Class A
1 year	$ 102
3 years	$ 318
5 years	$ 552
10 years	$ 1,225

Municipal Money Market Fund

FUND FACTS:

Goals:

· High Current Income Exempt from Regular Federal Income Tax

· Preservation of Capital

· Liquidity

Principal Investment:

· Municipal Money Market Securities

Class of Shares Offered in this Prospectus:

· Class A

Investment Advisor:

· Evergreen
Investment
Management
Company, LLC

NASDAQ Symbol:

· EXAXX

Dividend Payment Schedule:

· Monthly

INVESTMENT GOAL

The Fund seeks to achieve as high a level of current income exempt from regular federal income tax, as is consistent with preserving capital and providing liquidity.

INVESTMENT STRATEGY

The following supplements the investment strategies discussed in the ''Overview of Fund Risks'' on page 1.

The Fund invests at least 80% of its assets in municipal money market securities (including fixed, variable or floating rate general obligation and revenue bonds; tax, bond and revenue anticipation notes; and commercial paper obligations), the interest from which is exempt from federal income tax, other than the alternative minimum tax.

The Fund invests in municipal money market securities determined to present minimal credit risk and issued by any U.S. state, the District of Columbia and their political subdivisions. The Fund also invests in tender option bonds, which are demand obligations that bear interest at the prevailing short-term, tax-exempt rate. In determining which securities to purchase for the portfolio, the portfolio managers focus on the supply and demand of the security in the market place as well as the current interest rate environment.

RISK FACTORS

Your investment in the Fund is subject to the risks discussed in the ''Overview of Fund Risks'' on page 1 under the headings:

Interest Rate Risk
Credit Risk

For further information regarding the Fund's investment strategy and risk factors, see "Other Fund Practices."

PERFORMANCE

The following tables show how the Fund has performed in the past. Past performance is not an indication of future results.

Year-by-Year Total Return for Class A Shares (%)

1995	1996	1997	1998	1999	2000	2001	2002	2003	2004
3.48	3.08	3.18	3.1	2.87	3.7	2.37	0.97	0.52	0.62

Best Quarter:	4th Quarter 2000	+ 0.97 %
Worst Quarter:	3rd Quarter 2003	+ 0.08 %
Year-to-date total return as of 3/31/2005 is +0.29%.

Average Annual Total Return
(for the period ended 12/31/2004) ¹

	Inception Date of Class	1 year	5 year	10 year	Performance Since 11/2/1988
Class A	1/5/1995	0.62 %	1.63 %	2.38 %	3.14 %
3 Mo. T-Bill ²		1.33 %	2.95 %	4.14 %	4.80 %

1. Historical performance shown for Class A prior to its inception is based on the performance of Class I, the original class offered. Class I is not offered in this prospectus. The historical returns for Class A have not been adjusted to reflect the effect of the class' 12b-1 fees. These fees are 0.30% for Class A. Class I does not pay a 12b-1 fee. If these fees had been reflected, returns for Class A would have been lower.

To obtain current yield information call 1.800.343.2898.

FEES AND EXPENSES

You pay no shareholder transaction fees to the Fund.

Annual Fund Operating Expenses (expenses that are deducted from Fund assets)

	Class A
Management Fees	0.41 %
12b-1 Fees	0.30 %
Other Expenses	0.15 %
Total Fund Operating Expenses ³	0.86 %

3. The Fund's investment advisor may voluntarily waive its fees and/or reimburse the Fund for certain of its expenses in order to reduce expense ratios. The Fund's investment advisor may cease these voluntary waivers and/or reimbursements at any time. The Annual Fund Operating Expenses listed above do not reflect voluntary fee waivers and/or expense reimbursements. Including current voluntary fee waivers and/or expense reimbursements, Total Fund Operating Expenses were 0.82% for Class A.

Example of Fund Expenses

After:	Class A
1 year	$ 88
3 years	$ 274
5 years	$ 477
10 years	$ 1,061

New York Municipal Money Market Fund

FUND FACTS:

Goals:

· High Rate of Current Income Exempt from Federal and New York State and New York City Income Taxes

· Preservation of Capital

· Liquidity

Principal Investment:

· Municipal Money Market Securities

Class of Shares Offered in this Prospectus:

· Class A

Investment Advisor:

· Evergreen
Investment
Management
Company, LLC

NASDAQ Symbol:

· ENYXX

Dividend Payment Schedule:

· Monthly

INVESTMENT GOAL

The Fund seeks as high a rate of current income exempt from regular federal income tax and New York State and New York City personal income taxes as is believed to be consistent with preservation of capital and maintenance of liquidity.

INVESTMENT STRATEGY

The following supplements the investment strategies discussed in the ''Overview of Fund Risks'' on page 1.

The Fund will normally invest at least 80% of its assets in municipal money market securities issued by the State of New York, or any of its political subdivisions, agencies, or instrumentalities, or by other governmental units (such as U.S. territories), the interest from which is exempt from federal income tax other than the alternative minimum tax and exempt from New York State and New York City personal income taxes. Municipal money market securities include fixed, variable or floating rate general obligation and revenue bonds; tax, bond and revenue anticipation notes; and commercial paper obligations. The Fund also invests in tender option bonds, which are demand obligations that bear interest at the prevailing short-term, tax-exempt rate.

RISK FACTORS

Your investment in the Fund is subject to the risks discussed in the ''Overview of Fund Risks'' on page 1 under the headings:

Interest Rate Risk
Credit Risk
Concentration Risk
Non-Diversification Risk

Distributions of capital gains and other taxable income will be subject to tax under the personal income taxes of New York State, New York City and other New York municipalities. Corporations subject to the New York State corporation franchise tax or the New York City general corporation tax will generally be subject to tax on all distributions of income from the Fund.

For more information on the factors that could affect the ability of the New York municipal security issuers to pay interest and principal on securities acquired by the Fund, see "Additional Information Concerning New York" in the Statement of Additional Information.

For further information regarding the Fund's investment strategy and risk factors, see "Other Fund Practices."

PERFORMANCE

The following tables show how the Fund has performed in the past. Past performance is not an indication of future results.

Year-by-Year Total Return for Class A Shares (%)

1995	1996	1997	1998	1999	2000	2001	2002	2003	2004
							0.82	0.48	0.52

Best Quarter:	4th Quarter 2002	+ 0.24 %
Worst Quarter:	1st Quarter 2004	+ 0.07 %
Year-to-date total return as of 3/31/2005 is +0.27%.

Average Annual Total Return
(for the period ended 12/31/2004)

	Inception Date of Class	1 year	5 year	10 year	Performance Since 9/24/2001
Class A	9/24/2001	0.52 %	N/A	N/A	0.64 %
3 Mo. T-Bill ¹		1.33 %	N/A	N/A	1.51 %

To obtain current yield information call 1.800.343.2898.

FEES AND EXPENSES

You pay no shareholder transaction fees to the Fund.

Annual Fund Operating Expenses (expenses that are deducted from Fund assets)

	Class A
Management Fees	0.40 %
12b-1 Fees	0.30 %
Other Expenses	0.18 %
Total Fund Operating Expenses ²	0.88 %

2. The Fund's investment advisor may voluntarily waive its fees and/or reimburse the Fund for certain of its expenses in order to reduce expense ratios. The Fund's investment advisor may cease these voluntary waivers and/or reimbursements at any time. The Annual Fund Operating Expenses listed above do not reflect voluntary fee waivers and/or expense reimbursements. Including current voluntary fee waivers and/or expense reimbursements, Total Fund Operating Expenses were 0.84% for Class A.

Example of Fund Expenses

After:	Class A
1 year	$ 90
3 years	$ 281
5 years	$ 488
10 years	$ 1,084

U.S. Government Money Market Fund

FUND FACTS:

Goals:

· High Current Income

· Preservation of Capital

· Liquidity

Principal Investment:

· Short-term U.S. Government Securities

· Mortgage- and Asset-Backed Securities

Class of Shares Offered in this Prospectus:

· Class A

Investment Advisor:

· Evergreen
Investment
Management
Company, LLC

NASDAQ Symbol:

· EGAXX

Dividend Payment Schedule:

· Monthly

INVESTMENT GOAL

The Fund seeks to achieve as high a level of current income as is consistent with preserving capital and maintaining liquidity.

INVESTMENT STRATEGY

The following supplements the investment strategies discussed in the ''Overview of Fund Risks'' on page 1.

The Fund will normally invest at least 80% of its assets in U.S. government issued money market securities, which are high-quality, short-term securities issued or guaranteed by the U.S. government, its agencies or instrumentalities and repurchase agreements backed by such securities.

Under current market conditions, the Fund expects to invest substantially all of its assets in debt obligations issued by U.S. government agencies.

RISK FACTORS

Your investment in the Fund is subject to the risks discussed in the ''Overview of Fund Risks'' on page 1 under the headings:

Interest Rate Risk
Credit Risk

The debt instruments issued and/or guaranteed by the U.S. government, its agencies, or instrumentalities, in which the Fund invests typically include debt obligations issued by the Government National Mortgage Association ("Ginnie Mae"), the Federal National Mortgage Association ("Fannie Mae") and the Federal Home Loan Mortgage Corporation ("Freddie Mac"), Securities issued by Ginnie Mae, but not notes issued by Fannie Mae or Freddie Mac, are backed by the full faith and credit of the U.S. government. Fannie Mae and Freddie Mac, although chartered or sponsored by Congress, are not funded by congressional appropriations and the securities issued by them are neither guaranteed not insured by the U.S. government and are supported only by the credit of the issuer itself. In general, securities issued by the U.S. government-sponsored entities are neither insured nor guaranteed by the U.S. Treasury.

In addition, the Fund may also be subject to the risks associated with investing in mortgage-backed and other asset-backed securities. Asset-backed securities are created by the grouping of certain government-related loan, automobile and credit card receivables and other lender assets, such as mortgages, into pools. Interests in these pools are sold as individual securities. Traditional debt investments typically pay a fixed rate of interest until maturity, when the entire principal amount is due. By contrast, payments on mortgage-backed and many asset-backed investments typically include both interest and partial payment of principal. Principal may also be prepaid voluntarily, or as a result of refinancing or foreclosure. The Fund may have to invest in proceeds from prepaid investments in other investments with less attractive terms and yields. As a result, these securities may have less potential for capital appreciation during periods of declining interest rates than other securities of comparable maturities, although they may have a similar risk of decline in market value during periods of rising interest rates. Because the prepayment rate generally declines as interest rates rise, an increase in interest rates will likely increase the duration, and thus the volatility, of mortgage-backed and asset-backed securities. Some mortgage-backed and asset-backed investments receive only the interest portion (IOs) or the principal portion (POs) of payments on the underlying assets. The yields and values of these investments are extremely sensitive to changes in interest rates and in the rate of principal payments on the underlying assets. IOs tend to decrease in value if interest rates decline and rates of repayment (including prepayment) on the underlying mortgages or assets increase; it is possible that the Fund may lose the entire amount of its investment in an IO due to a decrease in interest rates. Conversely, POs tend to decrease in value if interest rates rise and rates of repayment decrease. Moreover, the market for IOs and POs may be volatile and limited, which may make them difficult for the Fund to buy or sell. The Fund may gain investment exposure to mortgage-backed and other asset-backed investments by entering into agreements with financial institutions to buy the investments at a fixed price at a future date. The Fund may or may not take delivery of the investments at the termination date of such an agreement, but will nonetheless be exposed to changes in value of the underlying investments during the term of the agreement.

For further information regarding the Fund's investment strategy and risk factors, see "Other Fund Practices."

PERFORMANCE

The following tables show how the Fund has performed in the past. Past performance is not an indication of future results.

The table below shows the percentage gain for the Class A shares of the Fund in each calendar year since its inception on 6/26/2001. It should give you a general idea of the risks of investing in the Fund. This table includes the effects of Fund expenses.

Year-by-Year Total Return for Class A Shares (%)

1996	1997	1998	1999	2000	2001	2002	2003	2004
						1.07	0.29	0.57

Best Quarter:	1st Quarter 2002	+ 0.31 %
Worst Quarter:	1st Quarter 2004	+ 0.04 %
Year-to-date total return as of 3/31/2005 is +0.41%.

Average Annual Total Return
(for the period ended 12/31/2004)

	Inception Date of Class	1 year	5 year	10 year	Performance Since 6/26/2001
Class A	6/26/2001	0.57 %	N/A	N/A	0.90 %
3 Mo. T-Bill ¹		1.33 %	N/A	N/A	1.70 %

To obtain current yield information call 1.800.343.2898.

FEES AND EXPENSES

You pay no shareholder transaction fees to the Fund.

Annual Fund Operating Expenses (expenses that are deducted from Fund assets) ²

	Class A
Management Fees	0.35 %
12b-1 Fees	0.30 %
Other Expenses	0.39 %
Total Fund Operating Expenses ³	1.04 %

2. Restated to reflect current fees.

Example of Fund Expenses

After:	Class A
1 year	$ 106
3 years	$ 331
5 years	$ 574
10 years	$ 1,271

THE FUNDS' INVESTMENT ADVISOR

An investment advisor manages a fund's investments and supervises its daily business affairs. Evergreen Investment Management Company, LLC (EIMC) is the investment advisor to the Funds. EIMC has been managing mutual funds and private accounts since 1932 and managed over $104.6 billion in assets for the Evergreen funds as of 12/31/2004. EIMC is located at 200 Berkeley Street, Boston, Massachusetts 02116-5034. EIMC is a subsidiary of Wachovia Corporation (Wachovia), the fourth largest bank holding company in the United States, with over $493.3 billion in consolidated assets as of 12/31/2004. Wachovia is located at 301 South College Street, Charlotte, North Carolina 28288-0013.

For the fiscal year ended 1/31/2005, the aggregate advisory fee paid to the investment advisor by each Fund was as follows:

Fund	% of the Fund's average daily net assets
California Municipal Money Market Fund	0.44 %
Money Market Fund	0.40 %
Municipal Money Market Fund	0.37 %
New York Municipal Money Market Fund	0.37 %
U.S. Government Money Market Fund	0.32 %

Legal Proceedings

Since September, 2003, governmental and self-regulatory authorities have instituted numerous ongoing investigations of various practices in the mutual fund industry, including investigations relating to revenue sharing, market-timing, late trading and record retention, among other things. The investigations cover investment advisors, distributors and transfer agents to mutual funds, as well as other firms. EIMC, Evergreen Investment Services, Inc. (EIS) and Evergreen Service Company, LLC (ESC) (collectively, “Evergreen”) have received subpoenas and other requests for documents and testimony relating to these investigations, are endeavoring to comply with those requests, and are cooperating with the investigations. Evergreen is continuing its own internal review of policies, practices, procedures and personnel, and is taking remedial action where appropriate.

In connection with one of these investigations, on July 28, 2004, the staff of the Securities and Exchange Commission (SEC) informed Evergreen that the staff intends to recommend to the SEC that it institute an enforcement action against Evergreen. The SEC staff’s proposed allegations relate to (i) an arrangement pursuant to which a broker at one of EIMC’s affiliated broker-dealers had been authorized, apparently by an EIMC officer (no longer with EIMC), to engage in short-term trading, on behalf of a client, in Evergreen Mid Cap Growth Fund (formerly Evergreen Emerging Growth Fund and prior to that known as Evergreen Small Company Growth Fund) during the period December, 2000, through April, 2003, in excess of the limitations set forth in the fund’s prospectus, (ii) short-term trading from September, 2001, through January, 2003, by a former Evergreen portfolio manager of Evergreen Precious Metals Fund, a fund he managed at the time, (iii) the sufficiency of systems for monitoring exchanges and enforcing exchange limitations as stated in the fund’s prospectus, and (iv) the adequacy of e-mail retention practices. In connection with the activity in Evergreen Mid Cap Growth Fund, EIMC reimbursed the fund $378,905, plus an additional $25,242, representing what EIMC calculated at that time to be the client’s net gain and the fees earned by EIMC and the expenses incurred by the fund on the client’s account. In connection with the activity in Evergreen Precious Metals Fund, EIMC reimbursed the fund $70,878, plus an additional $3,075, representing what EIMC calculated at that time to be the portfolio manager’s net gain and the fees earned by EIMC and expenses incurred by the fund on the portfolio manager’s account. Evergreen is currently engaged in discussions with the staff of the SEC concerning its recommendation.

Any resolution of these matters with regulatory authorities may include, but not be limited to, sanctions, penalties or injunctions regarding Evergreen, restitution to mutual fund shareholders and/or other financial penalties and structural changes in the governance or management of Evergreen’s mutual fund business. Any penalties or restitution will be paid by Evergreen and not by the Evergreen funds.

In addition, the Evergreen funds and EIMC and certain of its affiliates are involved in various legal actions, including private litigation and class action lawsuits. EIMC does not expect that any of such legal actions pending or threatened will have a material adverse impact on the financial position or operations of any of the Evergreen funds or on EIMC’s ability to provide services to the Evergreen funds.

Although Evergreen believes that neither the foregoing investigations described above nor any pending or threatened legal actions will have a material adverse impact on the Evergreen funds, there can be no assurance that these matters and any publicity surrounding or resulting from them will not result in reduced sales or increased redemptions of Evergreen fund shares, which could increase Evergreen fund transaction costs or operating expenses, or that they will not have other adverse consequences on the Evergreen funds.

CALCULATING THE SHARE PRICE

The value of one share of a Fund, also known as the net asset value, or NAV, is calculated at 4 p.m. Eastern time on each day the New York Stock Exchange is open or as of the time the Exchange closes, if earlier. The Fund calculates the share price for each share by adding up its total assets, subtracting all liabilities, then dividing the result by the total number of shares outstanding. The NAV of each class of shares is calculated separately.

The price per share received by a Fund for a purchase of shares or the amount paid by a Fund for a redemption of shares is based on the next price calculated after the order is received and all required information is provided. The value of a Fund account at any given time is the latest share price multiplied by the number of shares in the account. The Funds seek to maintain a constant NAV of $1.00 per share.

Each security held by a Fund is valued on an amortized cost basis according to Rule 2a-7 under the Investment Company Act of 1940. Under this method of valuation, a security is initially valued at its acquisition cost, and thereafter a constant straightline amortization of any discount or premium is assumed each day regardless of the impact of fluctuating interest rates on the market value of the security.

Shareholders whose purchase of shares of the Fund is accepted at or before 2 p.m. Eastern time for Money Market Fund and U.S. Government Money Market Fund, and 12:00 Noon Eastern time for California Municipal Money Market Fund, Municipal Money Market Fund and New York Municipal Money Market Fund on any day the market is open, except in those cases where the market closes earlier, will receive the dividend declared by the Fund for that day; shareholders whose purchase of shares is accepted after the times noted above will begin earning dividends on the next business day after the Fund accepts their order.

HOW TO CHOOSE AN EVERGREEN FUND

When choosing an Evergreen fund, you should:

Most importantly, read the prospectus to see if the Fund is suitable for you.
Consider talking to an investment professional. He or she is qualified to give you investment advice based on your investment goals and financial situation and will be able to answer questions you may have after reading the Fund's prospectus. He or she can also assist you through all phases of opening your account.
Request any additional information you want about the Fund, such as the Statement of Additional Information (SAI), Annual Report or Semi-annual Report by calling 1.800.343.2898. In addition, any of these documents may be downloaded off our website at EvergreenInvestments.com.

HOW TO CHOOSE THE SHARE CLASS THAT BEST SUITS YOU

After choosing a Fund, you select a share class. The Funds offer up to six different share classes, each with its own fee and expense structure. Only Class A shares are offered in this prospectus.

Class A

Each Fund offers Class A shares at NAV without a front-end sales charge. However, Class A shares are subject to 12b-1 fees and certain broker-dealers and other financial institutions may impose a fee in connection with purchases of Class A shares of the Funds. When exchanging from Class A shares of a money market fund to a non-money market fund within the Evergreen funds family, a sales charge will be imposed on the exchange, unless the shares being exchanged have been subject to a previous sales charge. This sales charge only applies to Class A shares of an Evergreen money market fund.

Promotional Incentives on Dealer Commissions

EIS may, from time to time, provide promotional incentives, including reallowance and/or payment of up to the entire sales charge, to certain investment firms. Such incentives may, at EIS’s discretion, be limited to investment firms who allow their individual selling representatives to participate in such additional commissions. Please see "Distribution Expenses Under Rule 12b-1" in the SAI for more information regarding promotional incentives.

Additional Compensation to Financial Services Firms

EIMC or EIS has entered into revenue sharing arrangements under which EIMC or EIS, as the case may be, makes payments to financial services firms that are intended to provide incentives for the sale of shares of Evergreen funds or to compensate the intermediary for marketing or marketing support activities. Payments under these arrangements are made from EIMC’s or EIS’s resources, as the case may be, and are in addition to any front-end sales charges, up-front commissions, Rule 12b-1 fees or other payments made or incentives provided to the financial services firm. The amounts of these payments typically are calculated as a percentage of sales made to and/or assets held by customers of the financial services firm. In some cases, financial services firms will include the Evergreen funds on a "preferred list." Please contact your investment professional for more details regarding these arrangements or contact an Evergreen funds service representative at 1.800.346.3858 for a listing of financial services firms with whom we have such arrangements.

HOW TO BUY SHARES

Evergreen funds make investing easy. Once you decide on an amount and a share class, simply fill out an application and send in your payment, or talk to your investment professional or an Evergreen funds service representative.

	Minimum Initial Purchase of Class A Shares	Minimum Additional Purchases
Regular Accounts	$ 1,000	None
IRAs	$ 250	None
Systematic Investment Plan	$ 50	$25/monthly

Method	Opening an Account	Adding to an Account
By Mail or through an Investment Professional	Complete and sign the account application. Applications may be downloaded off our website at www.evergreeninvestments.com. Make the check payable to Evergreen funds. Cash, credit cards, third party checks, credit card checks or money orders will not be accepted. Mail the application and your check to the address below: Postal Service Address: Evergreen Investments P.O. Box 8400 Boston, MA 02266-8400 Overnight Address: Evergreen Investments 66 Brooks Drive, Suite 8400 Braintree, MA 02184-3800 Or deliver them to your investment professional (provided he or she has a broker-dealer arrangement with EIS).	Make your check payable to Evergreen funds. Write a note specifying: the Fund name share class your account number the name(s) in which the account is registered Mail to the address to the left or deliver to your investment professional (provided he or she has a broker-dealer arrangement with EIS).
By Phone	Call 1-800-343-2898 to set up an account number and get wiring instructions. Instruct your bank to wire or transfer your purchase (they may charge a wiring fee). Complete the account application and mail to: Postal Service Address: Evergreen Investments P.O. Box 8400 Boston, MA 02266-8400 Overnight Address: Evergreen Investments 66 Brooks Drive, Suite 8400 Braintree, MA 02184-3800 Trades accepted after 2 p.m. Eastern time for Money Market Fund and U.S. Government Money Market Fund and 12 Noon Eastern time for California Municipal Money Market Fund, Municipal Money Market Fund and New York Municipal Money Market Fund on market trading days will receive dividends starting on the next market trading day. ¹	Call the Evergreen Express Line at 1-800-346-3858 24 hours a day or to speak with an Evergreen funds service representative call 1-800-343-2898 between 8 a.m. and 6 p.m. Eastern time, on any business day. If your bank account is set up on file, you can request either: Federal Funds Wire (offers immediate access to funds) or Electronic transfer through the Automated Clearing House which avoids wiring fees. A purchase transferred through ACH may not exceed $10,000.
By Exchange	You can make an additional investment by exchange from an existing Evergreen funds account by contacting your investment professional or an Evergreen funds service representative, calling the Evergreen Express Line at 1-800-346-3858 or by visiting our website at www.evergreeninvestments.com. ² You can only exchange shares from your account within the same class and under the same registration. There is no sales charge when exchanging funds within the Evergreen funds family. ³ Orders placed before 4 p.m. Eastern time on market trading days will be processed at that day's closing share price. Orders placed after 4 p.m. Eastern time will be processed at the next market trading day's closing price. ¹ "Round-trip" exchanges are limited to three per calendar quarter, but in no event more than five per calendar year. Exchanges between accounts which do not have identical ownership must be made in writing with a signature guarantee. (See "Redemption Requests That Require A Signature Guarantee" on the next page.)
Systematic Investment Plan (SIP)	You can transfer money automatically from your bank account into your Fund account on a monthly or quarterly basis. Initial investment minimum is $50 if you invest at least $25 per month with this service. To enroll, check off the box on the account application and provide: your bank account information the amount and date of your monthly or quarterly investment.	To establish automatic investing for an existing account, call 1-800-343-2898 for an application. The minimum is $25 per month or $75 per quarter. You can also establish an investing program through direct deposit from your paycheck. Call 1-800-343-2898 for details.

1. The Fund's shares may be made available through financial service firms which are also investment dealers and which have a service agreement with EIS. The Fund has approved the acceptance of purchase and redemption request orders effective as of the time of their receipt by certain authorized financial intermediaries or their designees as long as these orders are received by these entities prior to the Fund's closing time. These financial service firms may charge transaction fees. The Evergreen funds reserve the right to adjust the closing time to coincide with an earlier closing of the market or due to other unusual circumstances.

2. Once you have authorized either the telephone exchange or redemption service, anyone with a Personal Identification Number (PIN) and the required account information (including your investment professional) can request a telephone transaction in your account. All calls are recorded and may be monitored for verification, recordkeeping and quality-assurance purposes.

3. This does not apply to exchanges from Class A shares of an Evergreen money market fund, unless the shares have been subject to a previous sales charge.

HOW TO REDEEM SHARES

We offer you several convenient ways to redeem your shares in any of the Evergreen funds:

Methods	Requirements
Call Us	Call the Evergreen Express Line at 1.800.346.3858 24 hours a day or to speak with an Evergreen funds service representative call 1.800.343.2898 between 8 a.m. and 6 p.m. Eastern time, on any business day. This service must be authorized ahead of time, and is only available for regular accounts. ¹ All authorized requests made before 4 p.m. Eastern time on market trading days will be processed at that day's closing price. Requests made after 4 p.m. Eastern time will be processed the next market trading day. ² We can either: wire the proceeds into your bank account (service charges may apply) electronically transmit the proceeds into your bank account via the Automated Clearing House service mail you a check. All telephone calls are recorded and may be monitored for your protection. We are not responsible for acting on telephone orders we believe are genuine. See "Redemption Requests That Require a Signature Guarantee" below for requests that must be made in writing with your signature guaranteed.
Write Us	You can mail a redemption request to: Postal Service Address: Evergreen Investments P.O. Box 8400 Boston, MA 02266-8400 Overnight Address: Evergreen Investments 66 Brooks Drive, Suite 8400 Braintree, MA 02184-3800 Your letter of instructions must: list the Fund name and the account number indicate the number of shares or dollar value you wish to redeem be signed by the registered owner(s) See "Redemption Requests That Require a Signature Guarantee" below for requests that must be signature guaranteed. To redeem from an IRA or other retirement account, call 1.800.343.2898 for special instructions.
Redeem Your Shares in Person	You may also redeem your shares by contacting your investment professional or an Evergreen funds service representative. A fee may be charged for this service.

1. Once you have authorized either the telephone exchange or redemption service, anyone with a Personal Identification Number (PIN) and the required account information (including your investment professional) can request a telephone transaction in your account. All calls are recorded and may be monitored for verification, recordkeeping and quality-assurance purposes. The Evergreen funds reserve the right to terminate the exchange privilege of any shareholder who exceeds the listed maximum number of exchanges, as well as to reject any large dollar exchange or purchase if placing it would, in the judgment of the portfolio manager, adversely affect the price of the Fund.

2. The Fund's shares may be made available through financial service firms which are also investment dealers and which have a service agreement with EIS. The Fund has approved the acceptance of purchase and redemption request orders effective as of the time of their receipt by certain authorized financial intermediaries or their designees as long as these orders are received by these entities prior to the Fund's closing time. These financial service firms may charge transaction fees. The Evergreen funds reserve the right to adjust the closing time to coincide with an earlier closing of the market or due to other unusual circumstances.

Timing of Proceeds

Normally, we will send your redemption proceeds on the next business day after we receive your request; however, we reserve the right to wait up to ten business days to redeem any investments made by check or Automated Clearing House transfer. We also reserve the right to redeem in kind, under certain circumstances, by paying you the proceeds of a redemption in securities rather than in cash, and to redeem the remaining amount in the account if the account balance falls below the initial minimum amount.

Redemption Requests That Require a Signature Guarantee

To protect you and the Evergreen funds against fraud, certain redemption requests must be made in writing with your signature guaranteed. A signature guarantee can be obtained from such entities as those listed below. A notary public is not authorized to provide a signature guarantee. Only the most current medallion issued by the Securities Transfer Agent Medallion Program, Inc. will be accepted. For additional information about a signature guarantee, please contact your financial advisor or call Evergreen. The following circumstances require signature guarantees:

You are redeeming more than $50,000.
You want the proceeds transmitted into a bank account not listed on the account.
You want the proceeds payable to anyone other than the registered owner(s) of the account.
Either your address or the address of your bank account has been changed within 30 days.
The account is registered in the name of a fiduciary corporation or any other organization.
In these cases, additional documentation is required:
corporate accounts: certified copy of corporate resolution
fiduciary accounts: copy of the power of attorney or other governing document

Who Can Provide a Signature Guarantee:

Commercial Bank
Trust Company
Savings Association
Credit Union
Member of a U.S. stock exchange

OTHER SERVICES

Evergreen Express Line
1.800.346.3858

Use our automated, 24-hour service to check the value of your investment in a Fund; purchase, redeem or exchange Fund shares; find a Fund’s price, yield or total return; or order a statement or duplicate tax form.

Automatic Reinvestment of Distributions

For the convenience of investors, all dividends and capital gains distributions are automatically reinvested, unless you request otherwise. Distributions can be made by check or electronic transfer through the Automated Clearing House to your bank account. The details of your dividends and other distributions will be included on your statement.

Payroll Deduction

If you want to invest automatically through your paycheck, call 1.800.343.2898 to find out how you can set up direct payroll deductions. The amounts deducted will be invested in your Fund account using the Electronic Funds Transfer System. We will provide the Fund account number. Your payroll department will let you know the date of the pay period when your investment begins. Visit our website at EvergreenInvestments.com for more information.

Telephone Investment Plan

You may make additional investments electronically in an existing Fund account at amounts of not less than $100 or more than $10,000 per investment. Telephone transaction requests received by 4 p.m. Eastern time will be invested the day the request is received.

Dividend Exchange

You may elect on the application to reinvest capital gains and/or dividends earned in one Evergreen fund into an existing account in another Evergreen fund in the same share class and same registration — automatically. Please indicate on the application the Evergreen fund(s) into which you want to invest the distributions.

THE TAX CONSEQUENCES OF INVESTING
IN THE FUNDS

You will be taxed on fund distributions which may consist of dividends and capital gains. However, the sale of money market fund shares typically is not a tax reportable event because the net asset value of the shares generally would not change.

Fund Distributions

A mutual fund passes along to all of its shareholders the net income or profits it receives from its investments. The shareholders of the fund then pay any taxes due, whether they receive these distributions in cash or elect to have them reinvested. California Municipal Money Market Fund, Municipal Money Market Fund and New York Municipal Money Market Fund expect that substantially all of their regular dividends will be exempt from federal income tax other than the alternative minimum tax. Otherwise, the Funds will distribute two types of taxable income to you:

Dividends.To the extent that regular dividends are derived from investment income that is not tax-exempt, or from short-term capital gains, you will have to include them in your federal taxable income. Each Fund pays a monthly dividend from the dividends, interest and other income on the securities in which it invests.
Capital Gains.When a mutual fund sells a security it owns for a profit, the result is a capital gain. The Funds generally distribute capital gains, if any, at least once a year, near the end of the calendar year. Short-term capital gains reflect securities held by the Funds for a year or less and are considered ordinary income just like dividends. Profits on securities held longer than 12 months are considered long-term capital gains when they are distributed to shareholders. Individual shareholders receiving such distributions are taxed at a maximum rate no higher than 15%. It is not anticipated that any significant capital gains will be realized by the Funds.
Alternative Minimum Tax. An investment in California Municipal Money Market Fund, Municipal Money Market Fund and New York Municipal Money Market Fund may result in liability for federal alternative minimum tax (AMT), both for individual and corporate shareholders. For example, while the interest from qualified private activity bonds is generally not subject to federal income tax, many types of private activity bond interest must be included in taxable income for federal AMT purposes.

Dividend and Capital Gain Reinvestment

Unless you choose otherwise on the account application, all dividends will be reinvested. Distribution checks that are returned and distribution checks that are uncashed when the shareholder has failed to respond to mailings from the shareholder servicing agent will automatically be reinvested. No interest will accrue on amounts represented by uncashed distribution or redemption checks. We will send you a statement each January with the federal tax status of dividends and distributions paid by the Fund during the previous calendar year.

Profits You Realize When You Redeem Shares

When you sell shares in a mutual fund, whether by redeeming or exchanging, you have created a taxable event. You must report any gain or loss on your tax return unless the transaction was entered into by a tax-deferred retirement plan. It is your responsibility to keep accurate records of your mutual fund transactions. You will need this information when you file your income tax return, since you must report any capital gain or loss you incur when you sell shares. Remember, an exchange is a purchase and a sale for tax purposes.

Tax Reporting

ESC or your broker provides you and the IRS with a tax statement of your dividend and capital gains distributions for each calendar year on Form 1099 DIV. Proceeds from a sale, except for money market transactions, are reported on Form 1099B. You must report these on your tax return. You could pay a penalty if you neglect to report them. You may obtain a copy of the ESC tax information guide at EvergreenInvestments.com. Please consult your tax advisor for further information regarding the federal, state and local tax consequences of an investment in a fund.

Retirement Plans

You may invest in an Evergreen fund through various retirement plans, including IRAs, 401(k) plans, Simplified Employee Plans (SEPs), 403(b) plans, 457 plans and others. For special rules concerning these plans, including applications, restrictions, tax advantages, and potential sales charge waivers, contact your investment professional. To determine if a retirement plan may be appropriate for you, consult your tax advisor.

MORE INFORMATION ABOUT THE FUNDS' FEES AND EXPENSES

Every mutual fund has fees and expenses that are assessed either directly or indirectly. This section describes each of those fees.

OVERVIEW OF FEES AND EXPENSES

As summarized earlier in this prospectus, investors in the Evergreen funds may pay two types of fees: (i) transaction fees paid directly by the investor, including sales charges (loads) and redemption fees, and (ii) on-going fees that are deducted from the assets of the Fund, including management fees, distribution (Rule 12b-1) fees, transfer agency and shareholder service fees, and legal, audit, custody and other miscellaneous fees. These fees are described more fully below. Both types of fees reduce the overall return earned by an investor.

ANNUAL FUND OPERATING EXPENSES (expenses that are deducted from Fund assets)

An investment in an Evergreen mutual fund is subject to the following on-going fees, which reduce the overall return earned by an investor:

Management Fee

The management fee is paid by each Fund to the investment advisor for investment advisory services. These services include day-to-day management of the Fund’s portfolio of investments.

Distribution (Rule 12b-1) Fees

Distribution fees -- also known as Rule 12b-1 fees, referring to the SEC rule that authorizes the imposition of the fees -- are paid by a fund to support the marketing and sale of the Fund’s shares. The Trustees of the Evergreen funds have approved a policy to assess annual distribution fees of up to 0.75% of the average daily net assets of Class A shares. However, currently the distribution fees for Class A shares are limited to 0.30% of the average daily net assets of the class. These fees increase the cost of your investment. These fees may pay for marketing and advertising costs. They also may be used to pay commissions and other fees to broker-dealers who provide investment advice or investor services to their clients who have invested in the Funds.

Other Expenses

Other mutual fund expenses include, among other things, (i) administrative fees, which pay for certain administrative services necessary to the operation of a fund, including daily security and fund share pricing, making routine regulatory filings, and financial statement and shareholder report preparation; (ii) transfer agency and shareholder servicing fees, which pay the costs of maintaining shareholder accounts, generating and mailing shareholder statements, and providing other shareholder services; (iii) custody fees, which pay the costs of providing for the safekeeping of the fund’s securities and other assets; (iv) audit fees, which pay for the costs of having the fund’s financial statements audited; and (v) legal fees, which pay the costs of obtaining legal services necessary to the on-going operation of a fund.

Total Fund Operating Expenses

The expense ratio of the Funds is shown in the section entitled "Fees and Expenses." The Funds' expense ratio is made up of a management fee, 12b-1 fee (if any) and the various other fund expenses referred to above (i.e., administrative fees, custody fees, transfer agency fees, etc.). As a shareholder, you are not charged these fees directly; instead they are taken out before the Funds' NAV is calculated, and are expressed as a percentage of the Funds' average daily net assets. The effect of these fees is reflected in the performance results for the class to which they apply. Because these fees are not charged directly to your account, investors should examine them closely in the prospectus, especially when comparing one fund with another fund in the same investment category. Some key things to remember about expense ratios include: (i) your total return in the Funds is reduced by the fees and expenses paid by the Fund; (ii) expense ratios can vary greatly between funds and fund families; and (iii) the Funds' investment advisor may waive a portion of the Funds' expenses for a period of time, reducing its expense ratio.

PORTFOLIO TRADING COSTS

Portfolio trading costs for equity securities generally include commissions paid to broker-dealers for executing security purchases and sales on behalf of the Funds. Rather than being reflected as an ongoing expense of the Funds, brokerage commissions are added to the cost of purchasing a security, or subtracted from the proceeds from selling a security, when determining a Fund’s gain/loss from holding the security. Commissions are mostly paid on transactions in equity securities (stocks), although from time to time a fund might pay a commission on a transaction involving debt securities. For transactions in securities other than equity securities, broker-dealers are typically compensated through the receipt of an undisclosed amount of "mark-up" included in the price paid by the Funds for principal transactions (transactions directly with a dealer or other counterparty), which include most fixed-income security and certain derivative transactions. As a result, a Fund that invests exclusively in fixed income securities will typically have lower brokerage commissions, though not necessarily lower transaction costs, than a Fund that invests in equity securities.

FINANCIAL HIGHLIGHTS

This section looks in detail at the results for one share in Class A of the Funds offered in this prospectus - how much income it earned, how much of this income was passed along as a distribution and how much the return was reduced by expenses. The following tables have been derived from financial information audited by KPMG LLP, the Funds' independent registered public accounting firm. For a more complete picture of the Funds' financial statements, please see each Fund's Annual Report as well as the SAI, which is available upon request.

California Municipal Money Market Fund

	Year Ended January 31,
CLASS A	2005	2004	2003	2002 ¹
Net asset value, beginning of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Income from investment operations
Net investment income	0.01	0	0.01	0

Distributions to shareholders from
Net investment income	- 0.01	0 ²	- 0.01	0 ²

Net asset value, end of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Total return	0.56 %	0.40 %	0.92 %	0.40 %
Ratios and supplemental data
Net assets, end of period (thousands)	$ 56,228	$ 87,673	$ 122,687	$ 117,217
Ratios to average net assets
Expenses ³	0.94 %	0.94 %	0.88 %	0.89 %⁴
Net investment income	0.53 %	0.41 %	0.88 %	1.12 %⁴

1. For the period from September 24, 2001 (commencement of class operations), to January 31, 2002.

2. Amount represents less than $0.005 per share.

3. The ratio of expenses to average net assets excludes expense reductions but includes fee waivers and/or expense reimbursements.

4. Annualized

Money Market Fund

	Year Ended January 31,
CLASS A	2005	2004	2003	2002	2001
Net asset value, beginning of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Income from investment operations
Net investment income	0.01	0	0.01	0.03	0.06

Distributions to shareholders from
Net investment income	- 0.01	0 ¹	- 0.01	- 0.03	- 0.06

Net asset value, end of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Total return	0.68 %	0.32 %	1.14 %	3.20 %	5.84 %
Ratios and supplemental data
Net assets, end of period (millions)	$ 3,027	$ 6,261	$ 10,628	$ 9,605	$ 2,302
Ratios to average net assets
Expenses ²	0.94 %	0.93 %	0.89 %	0.88 %	0.84 %
Net investment income	0.60 %	0.33 %	1.12 %	2.42 %	5.54 %

1. Amount represents less than $0.005 per share.

2. The ratio of expenses to average net assets excludes expense reductions but includes fee waivers and/or expense reimbursements.

Municipal Money Market Fund

	Year Ended January 31,
CLASS A	2005	2004	2003	2002	2001
Net asset value, beginning of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Income from investment operations
Net investment income	0.01	0.01	0.01	0.02	0.04

Distributions to shareholders from
Net investment income	- 0.01	- 0.01	- 0.01	- 0.02	- 0.04
Net asset value, end of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Total return	0.68 %	0.51 %	0.95 %	2.18 %	3.69 %
Ratios and supplemental data
Net assets, end of period (millions)	$ 763	$ 958	$ 1,237	$ 953	$ 126
Ratios to average net assets
Expenses ¹	0.83 %	0.85 %	0.86 %	0.88 %	0.86 %
Net investment income	0.65 %	0.50 %	0.89 %	1.47 %	3.59 %

1. The ratio of expenses to average net assets excludes expense reductions but includes fee waivers and/or expense reimbursements.

New York Municipal Money Market Fund

	Year Ended January 31,
CLASS A	2005	2004	2003	2002 ¹
Net asset value, beginning of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Income from investment operations
Net investment income	0.01	0	0.01	0

Distributions to shareholders from
Net investment income	- 0.01	0 ²	- 0.01	0 ²

Net asset value, end of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Total return	0.58 %	0.46 %	0.82 %	0.33 %
Ratios and supplemental data
Net assets, end of period (thousands)	$ 78,542	$ 82,110	$ 101,114	$ 94,200
Ratios to average net assets
Expenses ³	0.87 %	0.91 %	0.88 %	0.88 %⁴
Net investment income	0.58 %	0.39 %	0.79 %	0.92 %⁴

1. For the period from September 24, 2001 (commencement of class operations), to January 31, 2002.

2. Amount represents less than $0.005 per share.

3. The ratio of expenses to average net assets excludes expense reductions but includes fee waivers and/or expense reimbursements.

4. Annualized

U.S. Government Money Market Fund

	Year Ended January 31,
CLASS A	2005	2004	2003	2002 ¹
Net asset value, beginning of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Income from investment operations
Net investment income	0.01	0	0.01	0.01

Distributions to shareholders from
Net investment income	- 0.01	0 ²	- 0.01	- 0.01

Net asset value, end of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Total return	0.68 %	0.26 %	1.01 %	1.33 %
Ratios and supplemental data
Net assets, end of period (thousands)	$ 901,382	$ 2,115,472	$ 3,979,856	$ 3,774,155
Ratios to average net assets
Expenses ³	0.88 %	0.93 %	0.88 %	0.88 %⁴
Net investment income	0.57 %	0.27 %	1.00 %	1.57 %⁴

1. For the period from June 26, 2001 (commencement of class operations), to January 31, 2002.

2. Amount represents less than $0.005 per share.

3. The ratio of expenses to average net assets excludes expense reductions but includes fee waivers and/or expense reimbursements.

4. Annualized

OTHER FUND PRACTICES

Taxable securities in which California Municipal Money Market Fund, Municipal Money Market Fund and New York Municipal Money Market Fund may invest on a short-term basis include obligations of the U.S. government, its agencies or instrumentalities, including repurchase agreements with banks or securities dealers involving such securities; time deposits maturing in not more than seven days; other debt securities rated within the two highest rating categories by any nationally recognized statistical ratings organization; commercial paper rated in the highest grade by Moody’s Investors Service, Inc. or Standard & Poor’s Ratings Services; and certificates of deposit issued by U.S. branches of U.S. banks with assets of $1 billion or more.

California Municipal Money Market Fund and New York Municipal Money Market Fund do not intend to concentrate their investments in any one industry. However, from time to time, a Fund may invest 25% or more of its assets in municipal securities which are related in such a way that an economic, business or political development or change affecting one such obligation would also affect the others. Two examples of obligations related in this way are (i) an obligation, the interest on which is paid from revenues of similar type projects and (ii) obligations whose issuers are located in the same state.

Please consult the SAI for more information regarding these and other investment practices used by the Funds, including related risks.

FUND GOVERNANCE

The management and operations of the Funds are supervised by a Board of Trustees that is responsible for representing the interests of shareholders. The Board meets quarterly and calls special meetings as needed to oversee the Funds’ activities and review, among other things, the Funds’ performance and expenses, contractual arrangements and regulatory compliance. The Board has established Executive, Performance, Audit, Pricing, Litigation Oversight and Distribution and Shareholder Service Committees to facilitate the fulfillment of its responsibilities. These Committees, with the exception of the Pricing and Litigation Oversight Committees, meet quarterly, and more frequently as needed. The Pricing Committee meets monthly and the Litigation Oversight Committee meets on an as-needed basis. The Executive Committee also serves as the Nominating Committee, 15(c) Committee and Qualified Legal Compliance Committee. For a description of each Committee’s responsibilities and a list of each Committee’s members, please see “Management of the Trust” in the SAI.

The Board has approved policies and procedures regarding Board governance, Trustee attendance at shareholder meetings, the process for delivering shareholder communications to the Board, and the Trustee nomination process. In addition, the Board, on an annual basis, meets to assess its own effectiveness and reviews and approves various Board operating policies and procedures. See “Fund Operating Policies and Procedures” below for more details.

The Board consists of eleven Trustees with diverse and substantial professional experience. Ten of the Trustees, including the Chairman of the Board, are independent (i.e., not “interested persons” of the Funds as defined in the Investment Company Act of 1940 (the “1940 Act”))("Independent Trustees"). These Independent Trustees meet in separate sessions from time to time. The Board is advised by independent legal counsel as defined under the 1940 Act and also has direct access to the Evergreen funds’ independent registered public accounting firm. In addition, the Board hires independent consultants to assist them in fulfilling their responsibilities.

See the SAI for additional information about the Board of Trustees, including Trustees’ compensation, Evergreen fund ownership by the Trustees, committee memberships and responsibilities.

If a shareholder wishes to contact the Board of Trustees or an individual Trustee directly, communications should be sent to the attention of the Board or a specific Trustee, P.O. Box 20083, Charlotte, North Carolina 28202.

The following individuals currently serve as Trustees of the Evergreen funds:

Independent Trustees:

Michael S. Scofield, Chairman of the Board, Director, Branded Media Corporation (multi-media branding company); Attorney, Law Offices of Michael S. Scofield; Former Director, Mentor Income Fund, Inc.; Former Trustee, Mentor Funds and Cash Resource Trust.

Charles A. Austin III, Investment Counselor, Anchor Capital Advisors, Inc. (investment advice); Director, The Andover Companies (insurance); Trustee, Arthritis Foundation of New England; Director, The Francis Ouimet Society; Former Director, Health Development Corp. (fitness-wellness centers); Former Director, Mentor Income Fund, Inc.; Former Trustee, Mentor Funds and Cash Resource Trust; Former Investment Counselor, Appleton Partners, Inc. (investment advice); Former Director, Executive Vice President and Treasurer, State Street Research & Management Company (investment advice).

Shirley Fulton, Partner, Tin, Fulton, Greene & Owen, PLLC (law firm); Former Partner, Helms, Henderson & Fulton, P.A. (law firm); Retired Senior Resident Superior Court Judge, 26th Judicial District, Charlotte, NC.

K. Dun Gifford, Chairman and President, Oldways Preservation and Exchange Trust (education); Trustee, Treasurer and Chairman of the Finance Committee, Cambridge College; Former Chairman of the Board, Director, and Executive Vice President, The London Harness Company (leather goods purveyor); Former Director, Mentor Income Fund, Inc.; Former Trustee, Mentor Funds and Cash Resource Trust.

Dr. Leroy Keith, Jr., Partner, Stonington Partners, Inc. (private equity firm); Trustee, The Phoenix Group of Mutual Funds; Director, Obagi Medical Products Co.; Director, Diversapack CO.; Former Director, Lincoln Educational Services; Former Chairman of the Board and Chief Executive Officer, Carson Products Company (manufacturing); Former Director, Mentor Income Fund, Inc.; Former Trustee, Mentor Funds and Cash Resource Trust.

Gerald M. McDonnell, Manager of Commercial Operations, SMI STEEL Co. - South Carolina (steel producer); Former Sales and Marketing Management, Nucor Steel Company; Former Director, Mentor Income Fund, Inc.; Former Trustee, Mentor Funds and Cash Resource Trust.

William Walt Pettit, Vice President, Kellam & Pettit, P.A. (law firm); Director, Superior Packaging Corp.; Director, National Kidney Foundation of North Carolina, Inc.; Former Director, Mentor Income Fund, Inc.; Former Trustee, Mentor Funds and Cash Resource Trust.

David M. Richardson, President, Richardson, Runden LLC (executive recruitment business development/consulting company); Consultant, Kennedy Information, Inc. (executive recruitment information and research company); Consultant, AESC (The Association of Retained Executive Search Consultants); Director, J&M Cumming Paper Co. (paper merchandising); Former Trustee, NDI Technologies, LLP (communications); Former Vice Chairman, DHR International, Inc. (executive recruitment); Former Director, Mentor Income Fund, Inc.; Former Trustee, Mentor Funds and Cash Resource Trust.

Russell A. Salton III, MD, President/CEO, AccessOne MedCard; Former Medical Director, Healthcare Resource Associates, Inc.; Former Medical Director, U.S. Health Care/Aetna Health Services; Former Director, Mentor Income Fund, Inc.; Former Trustee, Mentor Funds and Cash Resource Trust.

Richard J. Shima, Independent Consultant; Director, Trust Company of Connecticut; Trustee, Saint Joseph College (CT); Director, Hartford Hospital; Trustee, Greater Hartford YMCA; Former Director, Enhance Financial Services, Inc.; Former Director, Old State House Association; Former Director of CTG Resources, Inc. (natural gas); Former Director, Mentor Income Fund, Inc.; Former Trustee, Mentor Funds and Cash Resource Trust.

Interested Trustee:

Richard K. Wagoner, CFA, Member and Former President, North Carolina Securities Traders Association; Member, Financial Analysts Society; Former Consultant to the Boards of Trustees of the Evergreen funds; Former Trustee, Mentor Funds and Cash Resource Trust.

Mr. Wagoner is an “interested person” of the Evergreen funds because of his ownership of shares of Wachovia Corporation, the parent to EIMC, the Evergreen funds’ investment advisor.

FUND OPERATING POLICIES AND PROCEDURES

The Evergreen funds are operated in compliance with policies and procedures approved by the Board of Trustees. The Board reviews the policies and procedures and recommends changes for continued appropriateness. In addition, the Board has designated a chief compliance officer, who is responsible for reviewing these policies and procedures and monitoring the Evergreen funds’ compliance with them. The chief compliance officer reports directly to the Board and provides the Board with quarterly reports.

Short-Term Trading

Excessive short-term trading in a Fund’s shares by investors can be detrimental to the interests of long-term shareholders. Excessive short-term trading may disrupt portfolio management of the Fund, harm Fund performance, create transaction and other administrative costs that are borne by all shareholders and, ultimately, result in a dilution of or otherwise have a negative impact on the value of the Fund’s shares.

To limit the negative effects of short-term trading on the Funds, the Evergreen funds have adopted certain restrictions on trading by investors. Investors are limited to three "round-trip" exchanges per calendar quarter and five "round-trip" exchanges per calendar year. A "round-trip" exchange occurs when an investor exchanges from one fund to another fund and back to the original fund. If a Fund discovers that an investor has exceeded these "round-trip" exchange limitations, the Fund will reject the purchase or exchange or terminate the investor's investment or exchange privileges. In addition, a Fund reserves the right to reject any purchase or exchange, and to terminate an investor's investment or exchange privileges, if the Fund determines in its sole discretion that trading activity by the investor may be materially detrimental to the interests of long-term shareholders. A Fund may reject purchases or exchanges, or terminate investment or exchange privileges, even if the investor has not exceeded the three-per-quarter/five-per-year limits described above. In considering whether trading activity may be materially detrimental to the interests of long-term shareholders, the Funds consider a number of factors, such as the frequency of trading by the investor, the amount involved in the investor's trades, and the length of time the investment is held, along with other factors.

The Evergreen funds attempt to enforce the foregoing trading restrictions by monitoring purchases, sales and exchanges on a daily basis. However, there are certain limitations on the Fund’s ability to detect and prevent trading that would violate these restrictions. For example, while the Fund has access to trading information relating to investors who trade and hold their shares directly with the Fund, the Fund may not have access to such information for investors who trade through financial intermediaries such as broker-dealers and financial advisors or through retirement plans. Certain financial intermediaries and retirement plans hold their shares or those of their clients through omnibus accounts maintained with the Fund. In the case of omnibus accounts, the Fund does not have access to information regarding trading activity by individual investors, and therefore is unable to monitor for excessive short-term trading or violations of the Fund’s trading restrictions. A majority of the Fund's shares may be held in omnibus accounts. For these and other reasons, it is possible that excessive short-term trading or trading in violation of the Fund’s trading restrictions may occur despite the Fund’s efforts to prevent them.

Fund Pricing

EIMC has a Pricing Committee, which meets regularly and presents its report to the Board of Trustees. The Board of Trustees also has a Pricing Committee, which reviews fair valuation issues. In addition, EIMC employs a pricing administrator to monitor pricing activity daily. Pricing of portfolio securities is described in detail under the section entitled "Calculating the Share Price."

EIMC is committed to providing a daily NAV for each Fund that is reflective of the value of the securities held within the portfolio and believes that the Evergreen funds' pricing policies will help to limit opportunities for price arbitrage within the Funds.

Portfolio Holdings

EIMC is committed to providing all Evergreen fund shareholders equal access to portfolio holdings. A complete listing of portfolio holdings for every Evergreen money market fund as of each calendar quarter end is made available to the public approximately 15 calendar days after the quarter end at EvergreenInvestments.com. In addition, certain Funds (such as Evergreen money market funds) may make available to the public a complete list of holdings as of month end, which is posted to EvergreenInvestments.com within approximately 15 calendar days after the month end. Once released to the web, there are no restrictions on providing the data to any shareholder or external party. No other dissemination of portfolio holdings will be allowed to any shareholder, potential shareholder or party external to the Evergreen funds, except (i) as required by law, (ii) to external subadvisors with respect to the Fund it advises, or (iii) to institutional investment consultants or mutual fund analytical firms and, in such cases, only where there are signed confidentiality agreements in place. See "Policy for Dissemination of Portfolio Holdings" in the SAI for a more detailed description of this policy.

Transactions with Affiliates

EIMC and the Evergreen funds have policies and procedures that regulate their activities in situations where conflicts of interest could be detrimental to a Fund or its shareholders. In compliance with SEC exemptions, the Evergreen funds may engage in certain transactions with affiliates as long as certain conditions are met. Examples of such transactions include (i) a fund’s purchase of securities from an unaffiliated underwriter in a public offering for which an affiliate is acting as an underwriter; (ii) the transfer of securities from one fund to another fund with an affiliated investment advisor, without use of a broker-dealer; and (iii) the use of an affiliated broker-dealer for effecting transactions in a fund’s portfolio. The Board reviews reports provided quarterly on these matters to ensure that the Funds are in compliance with its policies and procedures regarding these activities and relevant SEC regulations.

Proxy Voting

EIMC recognizes that it has a fiduciary duty to vote proxies on behalf of the Evergreen funds who have delegated such responsibility to EIMC, and that in all cases proxies should be voted in a manner reasonably believed to be in the best interest of each Fund and its shareholders. For a copy of EIMC’s proxy voting policies and procedures, please see the SAI.

A copy of the proxy voting records indicating how the Evergreen funds have voted proxies relating to portfolio securities during the twelve-month period ended June 30, may be obtained, without charge, by visiting EvergreenInvestments.com, or the SEC’s website at sec.gov.

Privacy

EIMC and its affiliates are dedicated to providing you with the highest level of service and protecting your privacy. As technology transforms the way information is collected and distributed, we want you to know that we have implemented a number of industry-leading practices for safeguarding the privacy and security of financial information about you. EIMC and its affiliates employ safeguards to protect customer information and to prevent fraud. EIMC and its affiliates do not sell customer information to other companies for marketing purposes. For more information, visit EvergreenInvestments.com or call 1.800.343.2898 to speak to an Evergreen service representative.

Evergreen Express Line

Call 1.800.346.3858

24 hours a day to

check your account
order a statement
get a Fund’s current price, yield and total return
buy, redeem or exchange Fund shares

Shareholder Services

Call 1.800.343.2898

Monday-Friday, 8 a.m. to 6 p.m. Eastern time to

buy, redeem or exchange Fund shares
order applications
get assistance with your account

Information Line for Hearing and Speech Impaired (TTY/TDD)

Call 1.800.343.2888

Monday-Friday, 8 a.m. to 6 p.m. Eastern time

Write us a letter

· Evergreen Investments

· P.O. Box 8400

· Boston, MA 02266-8400

to buy, redeem or exchange Fund shares
to change the registration on your account
for general correspondence

For express, registered or certified mail

· Evergreen Investments

· 66 Brooks Drive, Suite 8400

· Braintree, MA 02184-3800

Visit us on-line

· EvergreenInvestments.com

Regular communications you will receive
Account Statements— You will receive quarterly statements for each Fund you invest in. Please review and promptly notify Evergreen funds of any inaccuracies.

Confirmation Notices— A confirmation of your transaction, other than SIP and SWP, is sent within five days. Please review and promptly notify Evergreen funds of any inaccuracies.

Annual and Semi-annual Reports— You will receive a detailed financial report on each Fund you invest in twice a year.

Tax Forms— Each January you will receive any Fund tax information you need to complete your tax returns.

For More Information About the Evergreen Money Market Funds, Ask for:

Each Fund's most recent Annual or Semi-annual Report,which contains a complete financial accounting for each Fund and a complete list of each Fund's portfolio holdings as of a specific date, as well as commentary from each Fund’s portfolio managers. These reports discuss the market conditions and investment strategies that significantly affected the Funds' performance during the most recent fiscal year or period.
The Statement of Additional Information (SAI),which contains more detailed information about the Funds and their policies and procedures. The SAI has been filed with the Securities and Exchange Commission (SEC) and its contents are legally considered to be part of this prospectus.

For questions, other information, or to request a copy, without charge, of any of the documents, call 1.800.343.2898 or ask your investment professional. We will mail material within three business days. In addition, any of these documents may be downloaded off our website at EvergreenInvestments.com.

Information about the Funds (including their SAIs) is also available, without charge, on the SEC's Internet website at http://www.sec.gov. Copies of this material may be obtained, for a duplication fee, by writing the SEC Public Reference Section, Washington D.C. 20549-0102, or by electronic request at the following e-mail address: publicinfo@sec.gov. This material can also be reviewed and copied at the SEC’s Public Reference Room in Washington, D.C. For more information about the operation of the Public Reference Room, call the SEC at 1.202.942.8090.

· Evergreen mutual funds are distributed by Evergreen Investment Services, Inc.,

· 200 Berkeley Street, Boston, MA 02116-5034.

559021 RV4 (6/05)

· Evergreen Investments

· 200 Berkeley Street

· Boston, MA 02116-5034

SEC File No.: 811-08555

EVERGREEN MONEY MARKET TRUST

PART A

CLASSES ABCI PROSPECTUS

Prospectus, June 1, 2005

Evergreen
Money Market Funds

Evergreen California Municipal Money Market Fund
Evergreen Florida Municipal Money Market Fund
Evergreen Money Market Fund ^*
Evergreen Municipal Money Market Fund
Evergreen New Jersey Municipal Money Market Fund
Evergreen New York Municipal Money Market Fund
Evergreen Pennsylvania Municipal Money Market Fund
Evergreen Treasury Money Market Fund
Evergreen U.S. Government Money Market Fund

Class A
Class B
Class C
Class I

* Class B and Class C shares of the Evergreen Money Market Fund are available for purchase only by shareholders holding shares of the Fund as of December 31, 2004, and prospective shareholders making an exchange out of another mutual fund within the Evergreen family of funds.

FUND RISK/RETURN SUMMARIES:

Overview of Fund Risks
Evergreen California Municipal Money Market Fund
Evergreen Florida Municipal Money Market Fund
Evergreen Money Market Fund
Evergreen Municipal Money Market Fund
Evergreen New Jersey Municipal Money Market Fund
Evergreen New York Municipal Money Market Fund
Evergreen Pennsylvania Municipal Money Market Fund
Evergreen Treasury Money Market Fund
Evergreen U.S. Government Money Market Fund

GENERAL INFORMATION:

The Funds' Investment Advisor
Calculating the Share Price
How to Choose an Evergreen Fund
How to Choose the Share Class That Best Suits You
How To Reduce or Eliminate Your Sales Charge
How to Buy Shares
How to Redeem Shares
Other Services
The Tax Consequences of Investing in the Funds
More Information about the Funds' Fees and Expenses
Financial Highlights
Other Fund Practices
Fund Governance
Fund Operating Policies and Procedures

In general, the Funds included in this prospectus provide investors with a selection of investment alternatives which seek a high rate of current income consistent with stability of principal and liquidity. Evergreen Municipal Money Market Fund also seeks current income which is exempt from regular federal income tax and Evergreen California Municipal Money Market Fund, Evergreen Florida Municipal Money Market Fund, Evergreen New Jersey Municipal Money Market Fund, Evergreen New York Municipal Money Market Fund and Evergreen Pennsylvania Municipal Money Market Fund also seek current income which is exempt from regular federal income tax and, generally, applicable state taxes.

Fund Summaries Key

Each Fund's summary is organized around the following basic topics and questions:

INVESTMENT GOAL

INVESTMENT STRATEGY

RISK FACTORS

What are the specific risks for an investor in the Fund?

PERFORMANCE

How well has the Fund performed in the past year? The past five years? The past ten years?

FEES AND EXPENSES

How much does it cost to invest in the Fund?

Overview of Fund Risks

Money Market Funds

typically rely on a combination of the following strategies:

attempting to maintain $1.00 per share net asset value;
investing in high quality, short-term money market instruments, including U.S. government securities;
investing in compliance with industry-standard requirements for money market funds for the quality, maturity and diversification of investments; and
selling a portfolio investment: i) when a portfolio manager believes the issuer's investment fundamentals begin to deteriorate; ii) to take advantage of yield opportunities; iii) when the investment no longer appears to meet the Fund's investment objective; iv) when the Fund must meet redemptions; or v) for other investment reasons which a portfolio manager deems appropriate.

may be appropriate for investors who:

are seeking a conservative investment which invests in relatively safe securities;
are seeking a fund for short-term investment; and
are seeking liquidity.

Following this overview, you will find information on each Fund's specific investment strategies and risks.

Although the Funds seek to preserve the value of your investment at $1.00 per share, it is possible to lose money by investing in the Funds.

Risk Factors For All Mutual Funds

Please remember that an investment in a mutual fund is:

not guaranteed to achieve its investment goal;
not a deposit with a bank;
not insured, endorsed or guaranteed by the FDIC or any government agency; and
subject to investment risks.

The following are some of the most important factors that may affect the value of your investment. Other factors may be described in the discussion following this overview.

Interest Rate Risk

Credit Risk

Concentration Risk

Non-Diversification Risk

California Municipal Money Market Fund

FUND FACTS:

Goals:

· High Current Income Exempt from Federal and California State Income Taxes

· Preservation of Capital

· Liquidity

Principal Investment:

· Municipal Money Market Securities

Classes of Shares Offered in this Prospectus:

· Class A

· Class I

Investment Advisor:

· Evergreen
Investment
Management
Company, LLC

NASDAQ Symbols:

· ECMXX (Class A)

· ECUXX (Class I)

Dividend Payment Schedule:

· Monthly

INVESTMENT GOAL

INVESTMENT STRATEGY

The following supplements the investment strategies discussed in the ''Overview of Fund Risks'' on page 1.

RISK FACTORS

Your investment in the Fund is subject to the risks discussed in the ''Overview of Fund Risks'' on page 2 under the headings:

Interest Rate Risk
Credit Risk
Concentration Risk
Non-Diversification Risk

For further information regarding the Fund's investment strategy and risk factors, see "Other Fund Practices."

PERFORMANCE

The following tables show how the Fund has performed in the past. Past performance is not an indication of future results.

The table below shows the percentage gain for the Class I shares of the Fund in each calendar year since the Class I shares' inception on 9/24/2001. It should give you a general idea of the risks of investing in the Fund. This table includes the effects of Fund expenses.

Year-by-Year Total Return for Class I Shares (%)

1996	1997	1998	1999	2000	2001	2002	2003	2004
						1.23	0.73	0.80

Best Quarter:	4th Quarter 2002	+ 0.33 %
Worst Quarter:	3rd Quarter 2003	+ 0.13 %
Year-to-date total return as of 3/31/2005 is +0.34%.

The next table lists the Fund’s average annual total return by class over the past year and since inception. This table is intended to provide you with some indication of the risks of investing in the Fund.

Average Annual Total Return
(for the period ended 12/31/2004)

	Inception Date of Class	1 year	5 year	10 year	Performance Since 9/24/2001
Class A	9/24/2001	0.50 %	N/A	N/A	0.67 %
Class I	9/24/2001	0.80 %	N/A	N/A	1.00 %
3 Mo. T-Bill ¹		1.33 %	N/A	N/A	1.51 %

To obtain current yield information call 1.800.343.2898.

FEES AND EXPENSES

You pay no shareholder transaction fees to the Fund.

Annual Fund Operating Expenses (expenses that are deducted from Fund assets) ²

	Class A	Class I
Management Fees	0.45 %	0.45 %
12b-1 Fees	0.30 %	0.00 %
Other Expenses	0.19 %	0.19 %
Total Fund Operating Expenses	0.94 %	0.64 %

2. Restated to reflect current fees.

Example of Fund Expenses

After:	Class A	Class I
1 year	$ 96	$ 65
3 years	$ 300	$ 205
5 years	$ 520	$ 357
10 years	$ 1,155	$ 798

Florida Municipal Money Market Fund

FUND FACTS:

Goals:

· High Current Income Exempt from Federal and Florida State Taxes

· Preservation of Capital

· Liquidity

· Stability of Principal

Principal Investment:

· Municipal Money Market Securities

Classes of Shares Offered in this Prospectus:

· Class A

· Class I

Investment Advisor:

· Evergreen
Investment
Management
Company, LLC

NASDAQ Symbols:

· EFIXX (Class A)

· EFMXX (Class I)

Dividend Payment Schedule:

· Monthly

INVESTMENT GOAL

The Fund seeks to provide Florida residents an investment that is, to the extent possible, exempt from the Florida intangible personal property tax and to seek as high a level of current income exempt from regular federal income taxes, as is believed to be consistent with the preservation of capital, maintenance of liquidity and stability of principal.

INVESTMENT STRATEGY

The following supplements the investment strategies discussed in the ''Overview of Fund Risks'' on page 1.

The Fund will normally invest at least 80% of its assets in municipal money market securities issued by the State of Florida or its political subdivisions, agencies, or instrumentalities, or by other governmental units (such as U.S. territories), the interest from which is exempt from federal income tax other than the alternative minimum tax and exempt from the Florida intangible personal property tax, and are determined to present minimal credit risk. Municipal money market securities include fixed, variable or floating rate general obligation and revenue bonds; tax, bond and revenue anticipation notes; and commercial paper obligations. The Fund also invests in tender option bonds, which are demand obligations that bear interest at the prevailing short-term, tax-exempt rate.

RISK FACTORS

Your investment in the Fund is subject to the risks discussed in the ''Overview of Fund Risks'' on page 2 under the headings:

Interest Rate Risk
Credit Risk
Concentration Risk
Non-Diversification Risk

For more information on the factors that could affect the ability of Florida municipal security issuers to pay interest and principal on securities acquired by the Fund, see “Additional Information Concerning Florida” in the Statement of Additional Information.

For further information regarding the Fund's investment strategy and risk factors, see "Other Fund Practices."

PERFORMANCE

The following tables show how the Fund has performed in the past. Past performance is not an indication of future results.

The table below shows the percentage gain for the Class A shares of the Fund in each calendar year since the Class A shares' inception on 10/26/1998. It should give you a general idea of the risks of investing in the Fund by showing how the Fund’s return has varied from year-to-year. This table includes the effects of Fund expenses.

Year-by-Year Total Return for Class A Shares (%)

1996	1997	1998	1999	2000	2001	2002	2003	2004
			2.66	3.49	2.21	0.91	0.50	0.56

Best Quarter:	4th Quarter 2000	+ 0.93 %
Worst Quarter:	1st Quarter 2004	+ 0.08 %
Year-to-date total return as of 3/31/2005 is +0.28%.

The next table lists the Fund’s average annual total return by class over the past one and five years and since inception. This table is intended to provide you with some indication of the risks of investing in the Fund.

Average Annual Total Return
(for the period ended 12/31/2004) ¹

	Inception Date of Class	1 year	5 year	10 year	Performance Since 10/26/1998
Class A	10/26/1998	0.56 %	1.53 %	N/A	1.74 %
Class I	12/29/1998	0.86 %	1.83 %	N/A	2.04 %
3 Mo. T-Bill ²		1.33 %	2.95 %	N/A	3.29 %

1. Historical performance shown for Class I prior to its inception is based on the performance of Class A, the original class offered. The historical returns for Class I have not been adjusted to reflect the effect of the class' 12b-1 fee. These fees are 0.30% for Class A. Class I does not pay a 12b-1 fee. If these fees had been reflected, returns for Class I would have been higher.

To obtain current yield information call 1.800.343.2898.

FEES AND EXPENSES

You pay no shareholder transaction fees to the Fund.

Annual Fund Operating Expenses (expenses that are deducted from Fund assets)

	Class A	Class I
Management Fees	0.40 %	0.40 %
12b-1 Fees	0.30 %	0.00 %
Other Expenses	0.14 %	0.14 %
Total Fund Operating Expenses ³	0.84 %	0.54 %

Example of Fund Expenses

After:	Class A	Class I
1 year	$ 86	$ 56
3 years	$ 269	$ 174
5 years	$ 468	$ 303
10 years	$ 1,041	$ 681

Money Market Fund

FUND FACTS:

Goals:

· High Current Income

· Preservation of Capital

· Liquidity

Principal Investments:

· Money Market Instruments

· Short-term Corporate Debt Securities

Classes of Shares Offered in this Prospectus:

· Class A

· Class B

· Class C

· Class I

Investment Advisor:

· Evergreen
Investment
Management
Company, LLC

NASDAQ Symbols:

· EMAXX (Class A)

· EMBXX (Class B)

· EMCXX (Class C)

· EGMXX (Class I)

Dividend Payment Schedule:

· Monthly

INVESTMENT GOAL

The Fund seeks to achieve as high a level of current income as is consistent with preserving capital and providing liquidity.

INVESTMENT STRATEGY

The following supplements the investment strategies discussed in the ''Overview of Fund Risks'' on page 1.

RISK FACTORS

Your investment in the Fund is subject to the risks discussed in the ''Overview of Fund Risks'' on page 2 under the headings:

Interest Rate Risk
Credit Risk

For further information regarding the Fund's investment strategy and risk factors, see "Other Fund Practices."

PERFORMANCE

The following tables show how the Fund has performed in the past. Past performance is not an indication of future results.

The table below shows the percentage gain for the Class I shares of the Fund in each of the last ten calendar years. It should give you a general idea of the risks of investing in the Fund by showing how the Fund's return has varied from year-to-year. This table includes the effects of Fund expenses.

Year-by-Year Total Return for Class I Shares (%)

1995	1996	1997	1998	1999	2000	2001	2002	2003	2004
5.66	5.22	5.31	5.26	4.93	6.11	3.89	1.48	0.61	0.86

Best Quarter:	4th Quarter 2000	+ 1.57 %
Worst Quarter:	4th Quarter 2003	+ 0.11 %
Year-to-date total return as of 3/31/2005 is +0.47%.

The next table lists the Fund’s average annual total return by class over the past one, five and ten years and since inception. This table is intended to provide you with some indication of the risks of investing in the Fund.

Average Annual Total Return
(for the period ended 12/31/2004) ¹

	Inception Date of Class	1 year	5 year	10 year	Performance Since 11/2/1987
Class A	1/4/1995	0.57 %	2.28 %	3.61 %	4.64 %
Class B	1/26/1995	- 4.86 %	1.33 %	2.96 %	4.26 %
Class C	8/1/1997	- 0.86 %	1.70 %	3.23 %	4.42 %
Class I	11/2/1987	0.86 %	2.57 %	3.91 %	4.82 %
3 Mo. T-Bill ²		1.33 %	2.95 %	4.14 %	4.92 %

1. Historical performance shown for Classes A, B and C prior to their inception is based on the performance of Class I, the original class offered. The historical returns for Classes A, B and C have not been adjusted to reflect the effect of each class' 12b-1 fee. These fees are 0.30% for Class A and 1.00% for Classes B and C. Class I does not pay a 12b-1 fee. If these fees had been reflected, returns for Classes A, B and C would have been lower.

To obtain current yield information call 1.800.343.2898.

FEES AND EXPENSES

Shareholder Fees (fees paid directly from your investment)

Shareholder Transaction Expenses	Class A	Class B	Class C	Class I
Maximum deferred sales charge (as a % of either the redemption amount or initial investment, whichever is lower)	None	5.00 %	1.00 %	None
Maximum sales charge imposed on purchases (as a % of offering price)	None	None	None	None

Annual Fund Operating Expenses (expenses that are deducted from Fund assets) ³

	Class A	Class B	Class C	Class I
Management Fees	0.40 %	0.40 %	0.40 %	0.40 %
12b-1 Fees	0.30 %	1.00 %	1.00 %	0.00 %
Other Expenses	0.30 %	0.30 %	0.30 %	0.30 %
Total Fund Operating Expenses ⁴	1.00 %	1.70 %	1.70 %	0.70 %

3. Restated to reflect current fees.

Example of Fund Expenses

	Assuming Redemption At End of Period				Assuming No Redemption
After:	Class A	Class B	Class C	Class I	Class B	Class C
1 year	$ 102	$ 673	$ 273	$ 72	$ 173	$ 173
3 years	$ 318	$ 836	$ 536	$ 224	$ 536	$ 536
5 years	$ 552	$ 1,123	$ 923	$ 390	$ 923	$ 923
10 years	$ 1,225	$ 1,823	$ 2,009	$ 871	$ 1,823	$ 2,009

Municipal Money Market Fund

FUND FACTS:

Goals:

· High Current Income Exempt from Regular Federal Income Tax

· Preservation of Capital

· Liquidity

Principal Investment:

· Municipal Money Market Securities

Classes of Shares Offered in this Prospectus:

· Class A

· Class I

Investment Advisor:

· Evergreen
Investment
Management
Company, LLC

NASDAQ Symbols:

· EXAXX (Class A)

· EVTXX (Class I)

Dividend Payment Schedule:

· Monthly

INVESTMENT GOAL

The Fund seeks to achieve as high a level of current income exempt from regular federal income tax, as is consistent with preserving capital and providing liquidity.

INVESTMENT STRATEGY

The following supplements the investment strategies discussed in the ''Overview of Fund Risks'' on page 1.

RISK FACTORS

Your investment in the Fund is subject to the risks discussed in the ''Overview of Fund Risks'' on page 2 under the headings:

Interest Rate Risk
Credit Risk

For further information regarding the Fund's investment strategy and risk factors, see "Other Fund Practices."

PERFORMANCE

The following tables show how the Fund has performed in the past. Past performance is not an indication of future results.

Year-by-Year Total Return for Class I Shares (%)

1995	1996	1997	1998	1999	2000	2001	2002	2003	2004
3.76	3.39	3.49	3.40	3.18	4.01	2.67	1.27	0.82	0.92

Best Quarter:	4th Quarter 2000	+ 1.05 %
Worst Quarter:	3rd Quarter 2003	+ 0.16 %
Year-to-date total return as of 3/31/2005 is +0.36%.

Average Annual Total Return
(for the period ended 12/31/2004) ¹

	Inception Date of Class	1 year	5 year	10 year	Performance Since 11/2/1988
Class A	1/5/1995	0.62 %	1.63 %	2.38 %	3.14 %
Class I	11/2/1988	0.92 %	1.93 %	2.68 %	3.33 %
3 Mo. T-Bill ²		1.33 %	2.95 %	4.14 %	4.80 %

To obtain current yield information call 1.800.343.2898.

FEES AND EXPENSES

You pay no shareholder transaction fees to the Fund.

Annual Fund Operating Expenses (expenses that are deducted from Fund assets)

	Class A	Class I
Management Fees	0.41 %	0.41 %
12b-1 Fees	0.30 %	0.00 %
Other Expenses	0.15 %	0.15 %
Total Fund Operating Expenses ³	0.86 %	0.56 %

Example of Fund Expenses

After:	Class A	Class I
1 year	$ 88	$ 57
3 years	$ 274	$ 179
5 years	$ 477	$ 313
10 years	$ 1,061	$ 701

New Jersey Municipal Money Market Fund

FUND FACTS:

Goals:

· High Current Income Exempt from Federal and New Jersey State Income Taxes

· Preservation of Capital

· Liquidity

· Stability of Principal

Principal Investment:

· Municipal Money Market Securities

Classes of Shares Offered in this Prospectus:

· Class A

· Class I

Investment Advisor:

· Evergreen
Investment
Management
Company, LLC

NASDAQ Symbols:

· ENJXX (Class A)

· EJMXX (Class I)

Dividend Payment Schedule:

· Monthly

INVESTMENT GOAL

The Fund seeks to achieve as high a level of current income exempt from regular federal income tax and, to the extent possible, from New Jersey gross income tax, as is believed to be consistent with the preservation of capital, maintenance of liquidity and stability of principal.

INVESTMENT STRATEGY

The following supplements the investment strategies discussed in the ''Overview of Fund Risks'' on page 1.

The Fund will normally invest at least 80% of its assets in municipal money market securities issued by the State of New Jersey, or any of its political subdivisions, agencies, or instrumentalities, or by other governmental units (such as U.S. territories), the interest from which is exempt from federal income tax other than the alternative minimum tax and exempt from the New Jersey gross income tax, and which are determined to present minimal credit risk. Municipal money market securities include fixed, variable or floating rate general obligation and revenue bonds; tax, bond and revenue anticipation notes; and commercial paper obligations. The Fund also invests in tender option bonds, which are demand obligations that bear interest at the prevailing short-term, tax-exempt rate.

RISK FACTORS

Your investment in the Fund is subject to the risks discussed in the ''Overview of Fund Risks'' on page 2 under the headings:

Interest Rate Risk
Credit Risk
Concentration Risk
Non-Diversification Risk

For more information on the factors that could affect the ability of the New Jersey municipal security issuers to pay interest and principal on securities acquired by the Fund, see “Additional Information Concerning New Jersey” in the Statement of Additional Information.

For further information regarding the Fund's investment strategy and risk factors, see "Other Fund Practices."

PERFORMANCE

The following tables show how the Fund has performed in the past. Past performance is not an indication of future results.

Year-by-Year Total Return for Class A Shares (%)

1996	1997	1998	1999	2000	2001	2002	2003	2004
			2.54	3.46	2.28	0.92	0.55	0.58

Best Quarter:	4th Quarter 2000	+ 0.91 %
Worst Quarter:	1st Quarter 2004	+ 0.08 %
Year-to-date total return as of 3/31/2005 is +0.29%.

Average Annual Total Return
(for the period ended 12/31/2004) ¹

	Inception Date of Class	1 year	5 year	10 year	Performance Since 10/26/1998
Class A	10/26/1998	0.58 %	1.55 %	N/A	1.74 %
Class I	4/5/1999	0.88 %	1.85 %	N/A	2.02 %
3 Mo. T-Bill ²		1.33 %	2.95 %	N/A	3.29 %

To obtain current yield information call 1.800.343.2898.

FEES AND EXPENSES

You pay no shareholder transaction fees to the Fund.

Annual Fund Operating Expenses (expenses that are deducted from Fund assets) ³

	Class A	Class I
Management Fees	0.41 %	0.41 %
12b-1 Fees	0.30 %	0.00 %
Other Expenses	0.17 %	0.17 %
Total Fund Operating Expenses	0.88 %	0.58 %

3. Restated to reflect current fees.

Example of Fund Expenses

After:	Class A	Class I
1 year	$ 90	$ 59
3 years	$ 281	$ 186
5 years	$ 488	$ 324
10 years	$ 1,084	$ 726

New York Municipal Money Market Fund

FUND FACTS:

Goals:

· High Rate of Current Income Exempt from Federal and New York State and New York City Income Taxes

· Preservation of Capital

· Liquidity

Principal Investment:

· Municipal Money Market Securities

Classes of Shares Offered in this Prospectus:

· Class A

· Class I

Investment Advisor:

· Evergreen
Investment
Management
Company, LLC

NASDAQ Symbols:

· ENYXX (Class A)

· ENIXX (Class I)

Dividend Payment Schedule:

· Monthly

INVESTMENT GOAL

INVESTMENT STRATEGY

The following supplements the investment strategies discussed in the ''Overview of Fund Risks'' on page 1.

RISK FACTORS

Your investment in the Fund is subject to the risks discussed in the ''Overview of Fund Risks'' on page 2 under the headings:

Interest Rate Risk
Credit Risk
Concentration Risk
Non-Diversification Risk

For further information regarding the Fund's investment strategy and risk factors, see "Other Fund Practices."

PERFORMANCE

The following tables show how the Fund has performed in the past. Past performance is not an indication of future results.

Year-by-Year Total Return for Class I Shares (%)

1996	1997	1998	1999	2000	2001	2002	2003	2004
						1.13	0.78	0.83

Best Quarter:	4th Quarter 2004	+ 0.31 %
Worst Quarter:	1st Quarter 2004	+ 0.14 %
Year-to-date total return as of 3/31/2005 is +0.35%.

Average Annual Total Return
(for the period ended 12/31/2004)

	Inception Date of Class	1 year	5 year	10 year	Performance Since 9/24/2001
Class A	9/24/2001	0.52 %	N/A	N/A	0.64 %
Class I	9/24/2001	0.83 %	N/A	N/A	0.95 %
3 Mo. T-Bill ¹		1.33 %	N/A	N/A	1.51 %

To obtain current yield information call 1.800.343.2898.

FEES AND EXPENSES

You pay no shareholder transaction fees to the Fund.

Annual Fund Operating Expenses (expenses that are deducted from Fund assets)

	Class A	Class I
Management Fees	0.40 %	0.40 %
12b-1 Fees	0.30 %	0.00 %
Other Expenses	0.18 %	0.18 %
Total Fund Operating Expenses ²	0.88 %	0.58 %

Example of Fund Expenses

After:	Class A	Class I
1 year	$ 90	$ 59
3 years	$ 281	$ 186
5 years	$ 488	$ 324
10 years	$ 1,084	$ 726

Pennsylvania Municipal Money Market Fund

FUND FACTS:

Goals:

· High Current Income Exempt from Federal and Pennsylvania State Income Taxes

· Preservation of Capital

· Liquidity

Principal Investment:

· Municipal Money Market Securities

Classes of Shares Offered in this Prospectus:

· Class A

· Class I

Investment Advisor:

· Evergreen
Investment
Management
Company, LLC

NASDAQ Symbols:

· EPPXX (Class A)

· EPAXX (Class I)

Dividend Payment Schedule:

· Monthly

INVESTMENT GOAL

The Fund seeks to provide investors with as high a level of current income exempt from regular federal income tax and, to the extent possible, from Pennsylvania income tax, as is consistent with preserving capital and providing liquidity.

INVESTMENT STRATEGY

The following supplements the investment strategies discussed in the ''Overview of Fund Risks'' on page 1.

The Fund will normally invest at least 80% of its assets in municipal money market securities issued by the Commonwealth of Pennsylvania, or any of its political subdivisions, agencies, or instrumentalities, or by other governmental units (such as U.S. territories), the interest from which is exempt from federal income tax other than the alternative minimum tax and exempt from the Pennsylvania income tax, and are determined to present minimal credit risk. Municipal money market securities include fixed, variable or floating rate general obligation and revenue bonds; tax, bond and revenue anticipation notes; and commercial paper obligations. The Fund also invests in tender option bonds, which are demand obligations that bear interest at the prevailing short-term, tax-exempt rate.

RISK FACTORS

Your investment in the Fund is subject to the risks discussed in the ''Overview of Fund Risks'' on page 2 under the headings:

Interest Rate Risk
Credit Risk
Concentration Risk
Non-Diversification Risk

For more information on the factors that could affect the ability of the Pennsylvania municipal security issuers to pay interest and principal on securities acquired by the Fund, see “Additional Information Concerning Pennsylvania” in the Statement of Additional Information.

For further information regarding the Fund's investment strategy and risk factors, see "Other Fund Practices."

PERFORMANCE

The following tables show how the Fund has performed in the past. Past performance is not an indication of future results.

Year-by-Year Total Return for Class I Shares (%)

1995	1996	1997	1998	1999	2000	2001	2002	2003	2004
3.66	3.07	3.22	3.09	2.96	3.84	2.59	1.31	0.84	0.95

Best Quarter:	4th Quarter 2000	+ 1.01 %
Worst Quarter:	3rd Quarter 2003	+ 0.17 %
Year-to-date total return as of 3/31/2005 is +0.37%.

Average Annual Total Return
(for the period ended 12/31/2004) ¹

	Inception Date of Class	1 year	5 year	10 year	Performance Since 8/15/1991
Class A	8/22/1995	0.65 %	1.68 %	2.40 %	2.48 %
Class I	8/15/1991	0.95 %	1.90 %	2.55 %	2.59 %
3 Mo. T-Bill ²		1.33 %	2.95 %	4.14 %	4.12 %

To obtain current yield information call 1.800.343.2898.

FEES AND EXPENSES

You pay no shareholder transaction fees to the Fund.

Annual Fund Operating Expenses (expenses that are deducted from Fund assets) ³

	Class A	Class I
Management Fees	0.36 %	0.36 %
12b-1 Fees	0.30 %	0.00 %
Other Expenses	0.18 %	0.18 %
Total Fund Operating Expenses	0.84 %	0.54 %

3. Restated to reflect current fees.

Example of Fund Expenses

After:	Class A	Class I
1 year	$ 86	$ 55
3 years	$ 268	$ 173
5 years	$ 466	$ 302
10 years	$ 1,037	$ 677

Treasury Money Market Fund

FUND FACTS:

Goals:

· Stability of Principal

· Current Income

· Liquidity

Principal Investments:

· Short-term U.S. Treasury Obligations

· Repurchase Agreements backed by Short-term U.S. Treasury Obligations

Classes of Shares Offered in this Prospectus:

· Class A

· Class I

Investment Advisor:

· Evergreen
Investment
Management
Company, LLC

NASDAQ Symbols:

· ETAXX (Class A)

· ETYXX (Class I)

Dividend Payment Schedule:

· Monthly

INVESTMENT GOAL

The Fund seeks to maintain stability of principal while earning current income and providing liquidity.

INVESTMENT STRATEGY

The following supplements the investment strategies discussed in the ''Overview of Fund Risks'' on page 1.

The Fund will normally invest at least 80% of its assets in short-term U.S. Treasury obligations and repurchase agreements backed by such obligations. U.S. Treasury securities are guaranteed as to principal and interest, and supported by the full faith and credit of the U.S. government.

The Fund maintains an average dollar-weighted maturity of 60 days or less.

RISK FACTORS

Your investment in the Fund is subject to the risks discussed in the ''Overview of Fund Risks'' on page 2 under the headings:

Interest Rate Risk
Credit Risk

For further information regarding the Fund's investment strategy and risk factors, see "Other Fund Practices."

PERFORMANCE

The following tables show how the Fund has performed in the past. Past performance is not an indication of future results.

Year-by-Year Total Return for Class I Shares (%)

1995	1996	1997	1998	1999	2000	2001	2002	2003	2004
5.69	5.09	5.22	5.14	4.65	5.91	3.66	1.52	0.70	0.93

Best Quarter:	4th Quarter 2000	+ 1.54 %
Worst Quarter:	3rd Quarter 2003	+ 0.14 %
Year-to-date total return as of 3/31/2005 is +0.47%.

Average Annual Total Return
(for the period ended 12/31/2004)

	Inception Date of Class	1 year	5 year	10 year	Performance Since 3/6/1991
Class A	3/6/1991	0.63 %	2.22 %	3.52 %	3.58 %
Class I	3/6/1991	0.93 %	2.52 %	3.83 %	3.89 %
3 Mo. T-Bill ¹		1.33 %	2.95 %	4.14 %	4.19 %

To obtain current yield information call 1.800.343.2898.

FEES AND EXPENSES

You pay no shareholder transaction fees to the Fund.

Annual Fund Operating Expenses (expenses that are deducted from Fund assets)

	Class A	Class I
Management Fees	0.31 %	0.31 %
12b-1 Fees	0.30 %	0.00 %
Other Expenses	0.12 %	0.12 %
Total Fund Operating Expenses	0.73 %	0.43 %

Example of Fund Expenses

After:	Class A	Class I
1 year	$ 75	$ 44
3 years	$ 233	$ 138
5 years	$ 406	$ 241
10 years	$ 906	$ 542

U.S. Government Money Market Fund

FUND FACTS:

Goals:

· High Current Income

· Preservation of Capital

· Liquidity

Principal Investment:

· Short-term U.S. Government Securities

· U.S. Government Agency Securities

Class of Shares Offered in this Prospectus:

· Class A

Investment Advisor:

· Evergreen
Investment
Management
Company, LLC

NASDAQ Symbol:

· EGAXX (Class A)

Dividend Payment Schedule:

· Monthly

INVESTMENT GOAL

The Fund seeks to achieve as high a level of current income as is consistent with preserving capital and maintaining liquidity.

INVESTMENT STRATEGY

The following supplements the investment strategies discussed in the ''Overview of Fund Risks'' on page 1.

Under current market conditions, the Fund expects to invest substantially all of its assets in debt obligations issued by U.S. government agencies.

RISK FACTORS

Your investment in the Fund is subject to the risks discussed in the ''Overview of Fund Risks'' on page 2 under the headings:

Interest Rate Risk
Credit Risk

For further information regarding the Fund's investment strategy and risk factors, see "Other Fund Practices."

PERFORMANCE

The following tables show how the Fund has performed in the past. Past performance is not an indication of future results.

Year-by-Year Total Return for Class A Shares (%)

1996	1997	1998	1999	2000	2001	2002	2003	2004
						1.07	0.29	0.57

Best Quarter:	1st Quarter 2002	+ 0.31 %
Worst Quarter:	1st Quarter 2004	+ 0.04 %
Year-to-date total return as of 3/31/2005 is +0.41%.

The next table lists the Fund’s average annual total return for Class A over the past year and since inception. This table is intended to provide you with some indication of the risks of investing in the Fund.

Average Annual Total Return
(for the period ended 12/31/2004)

	Inception Date of Class	1 year	5 year	10 year	Performance Since 6/26/2001
Class A	6/26/2001	0.57 %	N/A	N/A	0.90 %
3 Mo. T-Bill ¹		1.33 %	N/A	N/A	1.70 %

To obtain current yield information call 1.800.343.2898.

FEES AND EXPENSES

You pay no shareholder transaction fees to the Fund.

Annual Fund Operating Expenses (expenses that are deducted from Fund assets) ²

	Class A
Management Fees	0.35 %
12b-1 Fees	0.30 %
Other Expenses	0.39 %
Total Fund Operating Expenses ³	1.04 %

2. Restated to reflect current fees.

Example of Fund Expenses

After:	Class A
1 year	$ 106
3 years	$ 331
5 years	$ 574
10 years	$ 1,271

THE FUNDS' INVESTMENT ADVISOR

For the fiscal year ended 1/31/2005, the aggregate advisory fee paid to the investment advisor by each Fund was as follows:

Fund	% of the Fund's average daily net assets
California Municipal Money Market Fund	0.44 %
Florida Municipal Money Market Fund	0.39 %
Money Market Fund	0.40 %
Municipal Money Market Fund	0.37 %
New Jersey Municipal Money Market Fund	0.40 %
New York Municipal Money Market Fund	0.37 %
Pennsylvania Municipal Money Market Fund	0.36 %
Treasury Money Market Fund	0.31 %
U.S. Government Money Market Fund	0.32 %

Legal Proceedings

CALCULATING THE SHARE PRICE

Shareholders whose purchase of shares of a Fund is accepted at or before 2 p.m. Eastern time for Money Market Fund, Treasury Money Market Fund and U.S. Government Money Market Fund, and 12:00 Noon Eastern time for California Municipal Money Market Fund, Florida Municipal Money Market Fund, Municipal Money Market Fund, New Jersey Municipal Money Market Fund, New York Municipal Money Market Fund and Pennsylvania Municipal Money Market Fund on any day the market is open, except in those cases where the market closes earlier, will receive the dividend declared by the Fund for that day; shareholders whose purchase of shares is accepted after the times noted above will begin earning dividends on the next business day after the Fund accepts their order.

HOW TO CHOOSE AN EVERGREEN FUND

When choosing an Evergreen fund, you should:

Most importantly, read the prospectus to see if the Fund is suitable for you.
Consider talking to an investment professional. He or she is qualified to give you investment advice based on your investment goals and financial situation and will be able to answer questions you may have after reading the Fund's prospectus. He or she can also assist you through all phases of opening your account.
Request any additional information you want about the Fund, such as the Statement of Additional Information (SAI), Annual Report or Semi-annual Report by calling 1.800.343.2898. In addition, any of these documents may be downloaded off our website at EvergreenInvestments.com.

HOW TO CHOOSE THE SHARE CLASS THAT BEST SUITS YOU

After choosing a Fund, you must select a share class. Each share class has its own sales charge and fee structure. For additional information regarding these fees, see "Service Fees and Commissions Paid to Investment Firms" in part two of the SAI. Pay particularly close attention to the fee structure of each class so you know how much you will be paying before you invest.

There are several ways in which you may be able to reduce or eliminate sales charges. For example, combining the amounts held in Evergreen fund accounts by certain family members, or committing to invest an amount eligible for reduced sales charges within a certain period of time, may allow you to reduce or eliminate the sales charge. You may also be able to eliminate your sales charge based on how you make your investment in the Evergreen funds (such as through a financial advisor’s wrap account program), based on your relationship to the Evergreen funds and their related companies (for example, if you are an employee of Wachovia or a broker-dealer that sells Evergreen funds) and under certain circumstances (for example, upon the death or disability of a shareholder named on the account). See "How To Reduce or Eliminate Your Sales Charge" for more details about these programs, and remember to inform Evergreen or your investment professional of any other holdings in Evergreen funds or circumstances that may make you eligible for reduced sales charges.

Class A

Class B (Money Market Fund Only)

If you select Class B shares, you do not pay a front-end sales charge, so the entire amount of your purchase is invested in the Fund. However, you may pay a contingent deferred sales charge if you redeem your shares within six years. See "Calculating the Contingent Deferred Sales Charge for Class B and Class C Shares" for information on how the six-year holding period is calculated and how the contingent deferred sales charge is calculated at the time of redemption. In addition, your shares are subject to 12b-1 fees. After eight years, Class B shares automatically convert to Class A shares.

The amount of the maximum contingent deferred sales charge depends on the length of time the shares are held, as shown below:

Years Held	Maximum Contingent Deferred Sales Charge
1	5.00 %
2	4.00 %
3	3.00 %
4	3.00 %
5	2.00 %
6	1.00 %
Thereafter	0.00 %
8	Converts to Class A
Dealer Allowance	4.00 %

The maximum contingent deferred sales charge and dealer allowance may be reduced for certain investors. See "How To Reduce or Eliminate Your Sales Charge" below.

A shareholder may not purchase Class B shares if the purchase would cause the shareholder's aggregate Class B share holdings in the Evergreen funds to exceed $250,000. Purchase orders that would cause a shareholder's account to exceed this amount in Class B shares will be treated as a purchase of Class A shares. However, Evergreen is not able to track a shareholder's purchases made through financial intermediaries or held in an omnibus account. It will be necessary for the financial intermediary to track purchases of the Funds by their clients to ensure adherence to our policy. Certain of the Funds' financial intermediaries are currently in the process of enhancing their computer systems in order to have the ability to aggregate shares. Until these systems are complete, such financial intermediaries are unable to aggregate share class purchases. Purchases of Class B shares made through different financial intermediaries, such as through two different broker-dealers, would not be able to be tracked and aggregated.

Class C (Money Market Fund Only)

If you select Class C shares, you do not pay a front-end sales charge but your shares are subject to 12b-1 fees. In addition, you may pay a contingent deferred sales charge if you redeem your shares within one year. See "Calculating the Contingent Deferred Sales Charge for Class B and Class C Shares" for information on how the one-year holding period is calculated and how the contingent deferred sales charge is calculated at the time of redemption. These shares do not convert to Class A shares, so the higher 12b-1 fees paid by Class C shares continue for the life of the account.

The amount of the maximum contingent deferred sales charge depends on the length of time the shares are held, as shown below:

Years Held	Maximum Contingent Deferred Sales Charge
1	1.00 %
Thereafter	0.00 %
Dealer Allowance	1.00 %

The maximum contingent deferred sales charge and dealer allowance may be reduced for certain investors. See "How To Reduce or Eliminate Your Sales Charge" below.

As of December 31, 2004, Class B and Class C shares of the Evergreen Money Market Fund are available for purchase only by shareholders holding shares of the Fund as of that date, and prospective shareholders making an exchange out of another mutual fund within the Evergreen family of funds.

Class I (All Funds Except U.S. Government Money Market Fund)

The Fund offers Class I shares at NAV without a front-end sales charge, contingent deferred sales charge or 12b-1 fees. Class I shares are only offered, subject to the minimum initial purchase requirements stated under "How To Buy Shares," in the following manner: (1) to investment advisory clients of EIMC (or its advisory affiliates) when purchased by such advisor(s) on behalf of its clients, (2) through arrangements entered into on behalf of the Evergreen funds with certain financial services firms, (3) to certain institutional investors, and (4) to persons who owned Class Y shares in registered name in an Evergreen fund on or before December 31, 1994 or who owned shares of any SouthTrust fund in registered name as of March 18, 2005.

Calculating the Contingent Deferred Sales Charge for Class B and Class C Shares (Money Market Fund Only)

The holding period for the contingent deferred sales charge for Class B and Class C shares begins on the day your purchase is accepted. See "How to Buy Shares" for a complete description of the Funds' purchase procedures. For example, if you purchase Class B shares on January 2nd, a redemption of any of those shares will be subject to the 5.00% contingent deferred sales charge through January 2nd of the following year. Beginning on January 3rd of the following year, you will be subject to the 4.00% contingent deferred sales charge on redemptions of those shares through January 2nd of the next year. Please refer to the tables above for the complete schedule of each class's maximum contingent deferred sales charge.

If a contingent deferred sales charge is imposed, the Fund deducts it from the redemption proceeds you would otherwise receive. The contingent deferred sales charge is a percentage of the lesser of (i) the NAV of the shares at the time of redemption or (ii) the shareholder's original net cost for such shares. Upon request for redemption, the Fund will first seek to redeem shares not subject to the contingent deferred sales charge and then shares held the longest in an effort to keep the contingent deferred sales charge a shareholder would pay as low as possible. The contingent deferred sales charge on any redemption is, to the extent permitted by NASD, paid to EIS or its predecessor.

Promotional Incentives on Dealer Commissions

Additional Compensation to Financial Services Firms

HOW TO REDUCE OR ELIMINATE YOUR SALES CHARGE

There are several ways in which you may be able to reduce or eliminate sales charges, regardless of whether you hold your shares directly with the Fund or through a financial intermediary.

Contact Evergreen or your investment professional if you think you may qualify for any of the sales charge reduction or elimination programs described below.

At the time of making a purchase or redemption, it may be necessary for you to inform Evergreen or your investment professional of the existence of other accounts, or any other facts and circumstances, that may be relevant to qualifying for any of these programs and to provide Evergreen or your investment professional with certain information or records, such as account statements, to verify your qualification for any of these programs.You should provide information and records regarding shares of Evergreen funds held in all accounts with your investment professional or any other financial intermediary by you and/or members of your immediate family. For further details on exactly who is a member of your immediate family, please see the discussion entitled "Immediate Family Members" at the end of this section.

You can find information relating to the Funds' sales charge reduction and elimination programs free of charge at EvergreenInvestments.com. For more information on sales charge reduction and elimination programs, see "Purchase and Redemption of Shares" in the SAI.

Class B and Class C

You will not be assessed a contingent deferred sales charge for Class B or Class C shares if you redeem shares in the following situations:

When the shares were purchased through reinvestment of dividends/capital gains.
Death of a shareholder named on the relevant account, provided the redemption is made prior to registering the account in another name or changing the account registration to remove the decedent’s name.
Disability of a shareholder named on the relevant account incurred after purchase of the shares (this generally excludes accounts registered in the names of trusts and other entities).
Systematic withdrawals of up to 1.00% of the account balance per month or up to 3.00% of the account balance per quarter.
Shares in an account that has been closed because it falls below the minimum initial purchase amount.
Lump-sum distribution from a 401(k) plan or other benefit plan qualified under ERISA.
Mandatory withdrawals from the ERISA plan of a shareholder who is at least 70½ years old.
Loan proceeds and financial hardship distributions from a retirement plan.
Returns of excess contributions or excess deferral amounts made to a retirement plan participant.
A redemption by an individual participant in a corporate-sponsored retirement plan or non-qualified deferred compensation plan (this waiver is not available in the event such a plan, as a whole, redeems substantially all of its assets).

Classes B and C

Reinstatement Privileges.Subject to the Funds’ Short-Term Trading Policy, within 90 days of redeeming out of an Evergreen fund, you may re-establish your investment at the current NAV by reinvesting some, or all, of your redemption proceeds into the same share class of any Evergreen fund in an account registered in the same name(s). If a contingent deferred sales charge was deducted from your redemption proceeds, the amount of the contingent deferred sales charge attributable to the amount reinvested will be credited to your account at the NAV on the date of reinstatement. Your contingent deferred sales charge schedule will resume from the time of the original redemption. Any redemption fee charged in connection with the redemption will not be refunded in connection with these privileges. If you are eligible for reinstatement, you must inform Evergreen or your investment professional at the time of your reinvestment or you may not receive reinstatement in accordance with these privileges.

Immediate Family Members

Immediate family members include the following, and only the following:

Your spouse, who is the person to whom you are legally married. We also consider your spouse to include the following:

an individual of the same sex with whom you have been joined in a civil union, or legal contract similar to marriage;
a domestic partner, who is an individual (including one of the same sex) with whom you share a primary residence for at least six months, in a relationship as a couple where you, your domestic partner or both of you provide personal or financial welfare of the other without a fee, to whom you are not related by blood and to whom you are not married; and
an individual with whom you have a common law marriage, which is a marriage in a state where such marriages are recognized between a man and a woman arising from the fact that the two live together and hold themselves out as being married.

Your parents, who are your biological or adoptive mother and father. We also consider your parents to include any legal guardian, who is the person legally placed in charge of your affairs if you are a minor or legally incompetent, and your stepparents. We do not consider your parents to include any mother-in-law, father-in-law or grandparent.

Your siblings, who are your biological brothers and sisters, stepbrothers and stepsisters. We also consider your siblings to include your adoptive brothers and sisters. We do not consider your siblings to include any brother-in-law or sister-in-law.

Your children, who are your biological or adopted sons and daughters. We also consider your children to include your stepchildren, legal wards and persons for whom you stand in loco parentis. We do not consider your children to include any daughter-in-law, son-in-law or grandchild.

HOW TO BUY SHARES

	Minimum Initial Purchase of Class A, B and C Shares ¹	Minimum Initial Purchase of Class I Shares	Minimum Additional Purchases
Regular Accounts	$ 1,000 ²	$ 1,000,000 ^{3, 4}	None
IRAs	$ 250	N/A ⁴	None
Systematic Investment Plan	$ 50	N/A ⁴	$ 25/monthly (for Classes A, B and C) ⁴

1. The maximum aggregate purchase amount of Class B shares by a shareholder in the Evergreen funds is $250,000.

2. The Evergreen funds may redeem accounts that fall below the minimum initial purchase amount.

3. Minimum initial purchase amount does not apply to former Class Y shareholders, former SouthTrust funds shareholders, former Vestaur Securities Fund shareholders or to investment advisory clients of EIMC (or its advisory affiliates) when purchased by such advisors on behalf of their clients.

4. Former Class Y shareholders of former SouthTrust funds may invest at the Class A, B and C share amounts.

Method	Opening an Account	Adding to an Account
By Mail or through an Investment Professional	Complete and sign the account application. Applications may be downloaded off our website at www.evergreeninvestments.com. Make the check payable to Evergreen funds. Cash, credit cards, third party checks, credit card checks or money orders will not be accepted. Mail the application and your check to the address below: Postal Service Address: Evergreen Investments P.O. Box 8400 Boston, MA 02266-8400 Overnight Address: Evergreen Investments 66 Brooks Drive, Suite 8400 Braintree, MA 02184-3800 Or deliver them to your investment professional (provided he or she has a broker-dealer arrangement with EIS).	Make your check payable to Evergreen funds. Write a note specifying: the Fund name share class your account number the name(s) in which the account is registered Mail to the address to the left or deliver to your investment professional (provided he or she has a broker-dealer arrangement with EIS).
By Phone	Call 1-800-343-2898 to set up an account number and get wiring instructions. Instruct your bank to wire or transfer your purchase (they may charge a wiring fee). Complete the account application and mail to: Postal Service Address: Evergreen Investments P.O. Box 8400 Boston, MA 02266-8400 Overnight Address: Evergreen Investments 66 Brooks Drive, Suite 8400 Braintree, MA 02184-3800 Trades accepted after 2 p.m. Eastern time for Money Market Fund, Treasury Money Market Fund and U.S. Government Money Market Fund and 12 Noon Eastern time for California Municipal Money Market Fund, Florida Municipal Money Market Fund, Municipal Money Market Fund, New Jersey Municipal Mone Market Fund, New York Municipal Money Market Fund and Pennsylvania Municipal Money Market Fund on market trading days will receive dividends starting on the next market trading day. ⁵	Call the Evergreen Express Line at 1-800-346-3858 24 hours a day or to speak with an Evergreen funds service representative call 1-800-343-2898 between 8 a.m. and 6 p.m. Eastern time, on any business day. If your bank account is set up on file, you can request either: Federal Funds Wire (offers immediate access to funds) or Electronic transfer through the Automated Clearing House which avoids wiring fees. A purchase transferred through ACH may not exceed $10,000.
By Exchange	You can make an additional investment by exchange from an existing Evergreen funds account by contacting your investment professional or an Evergreen funds service representative, calling the Evergreen Express Line at 1-800-346-3858 or by visiting our website at www.EvergreenInvestments.com. ⁶ You can only exchange shares from your account within the same class and under the same registration. There is no sales charge or redemption fee when exchanging funds within the Evergreen funds family. ⁷ Orders placed before 4 p.m. Eastern time on market trading days will be processed at that day's closing share price. Orders placed after 4 p.m. Eastern time will be processed at the next market trading day's closing price. ⁵ "Round-trip" exchanges are limited to three per calendar quarter, but in no event more than five per calendar year. Exchanges between accounts which do not have identical ownership must be made in writing with a signature guarantee. (See "Redemption Requests That Require A Signature Guarantee" on the next page.)
Systematic Investment Plan (SIP)	You can transfer money automatically from your bank account into your Fund account on a monthly or quarterly basis. Initial investment minimum is $50 if you invest at least $25 per month with this service. To enroll, check off the box on the account application and provide: your bank account information the amount and date of your monthly or quarterly investment.	To establish automatic investing for an existing account, call 1-800-343-2898 for an application. The minimum is $25 per month or $75 per quarter. You can also establish an investing program through direct deposit from your paycheck. Call 1-800-343-2898 for details.

5. The Fund's shares may be made available through financial service firms which are also investment dealers and which have a service agreement with EIS. The Fund has approved the acceptance of purchase and redemption request orders effective as of the time of their receipt by certain authorized financial intermediaries or their designees as long as these orders are received by these entities prior to the Fund's closing time. These financial service firms may charge transaction fees. The Evergreen funds reserve the right to adjust the closing time to coincide with an earlier closing of the market or due to other unusual circumstances.

6. Once you have authorized either the telephone exchange or redemption service, anyone with a Personal Identification Number (PIN) and the required account information (including your investment professional) can request a telephone transaction in your account. All calls are recorded and may be monitored for verification, recordkeeping and quality-assurance purposes.

7. This does not apply to exchanges from Class A shares of an Evergreen money market fund, unless the shares have been subject to a previous sales charge.

HOW TO REDEEM SHARES

We offer you several convenient ways to redeem your shares in any of the Evergreen funds:

Methods	Requirements
Call Us	Call the Evergreen Express Line at 1.800.346.3858 24 hours a day or to speak with an Evergreen funds service representative call 1.800.343.2898 between 8 a.m. and 6 p.m. Eastern time, on any business day. This service must be authorized ahead of time, and is only available for regular accounts. ¹ All authorized requests made before 4 p.m. Eastern time on market trading days will be processed at that day's closing price. Requests made after 4 p.m. Eastern time will be processed the next market trading day. ² We can either: wire the proceeds into your bank account (service charges may apply) electronically transmit the proceeds into your bank account via the Automated Clearing House service mail you a check. All telephone calls are recorded and may be monitored for your protection. We are not responsible for acting on telephone orders we believe are genuine. See "Redemption Requests That Require a Signature Guarantee" below for requests that must be made in writing with your signature guaranteed.
Write Us	You can mail a redemption request to: Postal Service Address: Evergreen Investments P.O. Box 8400 Boston, MA 02266-8400 Overnight Address: Evergreen Investments 66 Brooks Drive, Suite 8400 Braintree, MA 02184-3800 Your letter of instructions must: list the Fund name and the account number indicate the number of shares or dollar value you wish to redeem be signed by the registered owner(s) See "Redemption Requests That Require a Signature Guarantee" below for requests that must be signature guaranteed. To redeem from an IRA or other retirement account, call 1.800.343.2898 for special instructions.
Redeem Your Shares in Person	You may also redeem your shares by contacting your investment professional or an Evergreen funds service representative. A fee may be charged for this service.

Timing of Proceeds

Redemption Requests That Require a Signature Guarantee

You are redeeming more than $50,000.
You want the proceeds transmitted into a bank account not listed on the account.
You want the proceeds payable to anyone other than the registered owner(s) of the account.
Either your address or the address of your bank account has been changed within 30 days.
The account is registered in the name of a fiduciary corporation or any other organization.
In these cases, additional documentation is required:
corporate accounts: certified copy of corporate resolution
fiduciary accounts: copy of the power of attorney or other governing document

Who Can Provide a Signature Guarantee:

Commercial Bank
Trust Company
Savings Association
Credit Union
Member of a U.S. stock exchange

OTHER SERVICES

Evergreen Express Line
1.800.346.3858

Automatic Reinvestment of Distributions

Payroll Deduction (Class A, Class B and Class C only)

Telephone Investment Plan

Dividend Exchange

THE TAX CONSEQUENCES OF INVESTING
IN THE FUNDS

Fund Distributions

A mutual fund passes along to all of its shareholders the net income or profits it receives from its investments. The shareholders of the fund then pay any taxes due, whether they receive these distributions in cash or elect to have them reinvested. California Municipal Money Market Fund, Florida Municipal Money Market Fund, Municipal Money Market Fund, New Jersey Municipal Money Market Fund, New York Municipal Money Market Fund and Pennsylvania Municipal Money Market Fund expect that substantially all of their regular dividends will be exempt from federal income tax other than the alternative minimum tax. Otherwise, the Funds will distribute two types of taxable income to you:

Dividends. To the extent that regular dividends are derived from investment income that is not tax-exempt, or from short-term capital gains, you will have to include them in your federal taxable income. Each Fund pays a monthly dividend from the dividends, interest and other income on the securities in which it invests.
Capital Gains. When a mutual fund sells a security it owns for a profit, the result is a capital gain. The Funds generally distribute capital gains, if any, at least once a year, near the end of the calendar year. Short-term capital gains reflect securities held by the Funds for a year or less and are considered ordinary income just like dividends. Profits on securities held longer than 12 months are considered long-term capital gains when they are distributed to shareholders. Individual shareholders receiving such distributions are taxed at a maximum rate no higher than 15%. It is not anticipated that any significant capital gains will be realized by the Funds.
Alternative Minimum Tax. An investment in California Municipal Money Market Fund, Florida Municipal Money Market Fund, Municipal Money Market Fund, New Jersey Municipal Money Market Fund, New York Municipal Money Market Fund and Pennsylvania Municipal Money Market Fund may result in liability for federal alternative minimum tax (AMT), both for individual and corporate shareholders. For example, while the interest from qualified private activity bonds is generally not subject to federal income tax, many types of private activity bond interest must be included in taxable income for federal AMT purposes.

Dividend and Capital Gain Reinvestment

Profits You Realize When You Redeem Shares

Tax Reporting

Retirement Plans

MORE INFORMATION ABOUT THE FUNDS' FEES AND EXPENSES

Every mutual fund has fees and expenses that are assessed either directly or indirectly. This section describes each of those fees.

OVERVIEW OF FEES AND EXPENSES

SHAREHOLDER FEES (fees paid directly from your investment)

Shareholder fees generally are deducted directly from a shareholder’s investment in an account with a fund. Depending on the fund and the share class purchased, these fees may include front-end sales charges (deducted at the time the investor purchases shares of the fund), and deferred sales charges and redemption fees (deducted at the time the investor sells shares of the fund.) You should refer to the section entitled "How to Choose the Share Class that Best Suits You" for a complete schedule of front-end and contingent deferred sales charges by share class. Investors should pay particular attention to situations that would entitle them to either reduce or eliminate sales charges. Please see the section entitled "How to Reduce or Eliminate Sales Charges" for complete information. Not all Evergreen funds charge a redemption fee. You should refer to the table entitled “Shareholder Fees” to find out whether your Fund charges such a fee.

ANNUAL FUND OPERATING EXPENSES (expenses that are deducted from Fund assets)

An investment in an Evergreen mutual fund is subject to the following on-going fees, which reduce the overall return earned by an investor:

Management Fee

The management fee is paid by each Fund to the investment advisor for investment advisory services. These services include day-to-day management of the Fund’s portfolio of investments.

Distribution (Rule 12b-1) Fees

Distribution fees -- also known as Rule 12b-1 fees, referring to the SEC rule that authorizes the imposition of the fees -- are paid by a fund to support the marketing and sale of the Fund’s shares. The Trustees of the Evergreen funds have approved a policy to assess annual distribution fees of up to 0.75% of the average daily net assets of Class A shares and up to 1.00% of the average daily net assets of Class B and Class C shares. However, currently the distribution fees for Class A shares are limited to 0.30% of the average daily net assets of the class. Class I shares do not pay distribution fees. These fees increase the cost of your investment. The higher distribution fees imposed on Class B and Class C shares may, over time, cost more than the front-end sales charge of Class A shares. These fees may pay for marketing and advertising costs. They also may be used to pay commissions and other fees to broker/dealers who provide investment advice or investor services to their clients who have invested in the Funds.

Other Expenses

Total Fund Operating Expenses

PORTFOLIO TRADING COSTS

FINANCIAL HIGHLIGHTS

This section looks in detail at the results for one share in each share class of the Funds offered in this prospectus - how much income it earned, how much of this income was passed along as a distribution and how much the return was reduced by expenses. The following tables have been derived from financial information audited by KPMG LLP, the Funds' independent registered public accounting firm. For a more complete picture of the Funds' financial statements, please see the each Fund's Annual Report as well as the SAI.

California Municipal Money Market Fund

	Year Ended January 31,
CLASS A	2005	2004	2003	2002 ¹
Net asset value, beginning of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Income from investment operations
Net investment income	0.01	0	0.01	0

Distributions to shareholders from
Net investment income	- 0.01	0 ²	- 0.01	0 ²

Net asset value, end of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Total return	0.56 %	0.40 %	0.92 %	0.40 %
Ratios and supplemental data
Net assets, end of period (thousands)	$ 56,228	$ 87,673	$ 122,687	$ 117,217
Ratios to average net assets
Expenses ³	0.94 %	0.94 %	0.88 %	0.89 %⁴
Net investment income	0.53 %	0.41 %	0.88 %	1.12 %⁴

	Year Ended January 31,
CLASS I	2005	2004	2003	2002 ¹
Net asset value, beginning of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Income from investment operations
Net investment income	0.01	0.01	0.01	0.01

Distributions to shareholders from
Net investment income	- 0.01	- 0.01	- 0.01	- 0.01

Net asset value, end of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Total return	0.87 %	0.70 %	1.22 %	0.59 %
Ratios and supplemental data
Net assets, end of period (thousands)	$ 3,622	$ 11,447	$ 20,169	$ 168
Ratios to average net assets
Expenses ³	0.65 %	0.64 %	0.58 %	0.58 %⁴
Net investment income	0.74 %	0.69 %	0.99 %	1.42 %⁴

1. For the period from September 24, 2001 (commencement of class operations), to January 31, 2002.

2. Amount represents less than $0.005 per share.

3. The ratio of expenses to average net assets excludes expense reductions but includes fee waivers and/or expense reimbursements.

4. Annualized

Florida Municipal Money Market Fund

	Year Ended January 31,
CLASS A	2005	2004	2003	2002	2001
Net asset value, beginning of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Income from investment operations
Net investment income	0.01	0	0.01	0.02	0.03
Distributions to shareholders from
Net investment income	- 0.01	0 ¹	- 0.01	- 0.02	- 0.03

Net asset value, end of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Total return	0.62 %	0.49 %	0.89 %	2.03 %	3.48 %
Ratios and supplemental data
Net assets, end of period (thousands)	$ 18,368	$ 27,758	$ 30,804	$ 60,484	$ 27,519
Ratios to average net assets
Expenses ²	0.82 %	0.83 %	0.87 %	0.86 %	0.85 %
Net investment income	0.61 %	0.48 %	0.79 %	1.89 %	3.39 %

	Year Ended January 31,
CLASS I ³	2005	2004	2003	2002	2001
Net asset value, beginning of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Income from investment operations
Net investment income	0.01	0.01	0.01	0.02	0.04
Distributions to shareholders from
Net investment income	- 0.01	- 0.01	- 0.01	- 0.02	- 0.04

Net asset value, end of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Total return	0.92 %	0.79 %	1.20 %	2.34 %	3.79 %
Ratios and supplemental data
Net assets, end of period (thousands)	$ 37,692	$ 6,699	$ 2,785	$ 260	$ 71
Ratios to average net assets
Expenses ²	0.52 %	0.56 %	0.57 %	0.51 %	0.55 %
Net investment income	1.10 %	0.78 %	0.99 %	2.20 %	3.69 %

1. Amount represents less than $0.005 per share.

2. The ratio of expenses to average net assets excludes expense reductions but includes fee waivers and/or expense reimbursements.

3. Effective at the close of business on May 11, 2001, Class Y shares were renamed as Institutional shares (Class I).

Money Market Fund

	Year Ended January 31,
CLASS A	2005	2004	2003	2002	2001
Net asset value, beginning of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Income from investment operations
Net investment income	0.01	0	0.01	0.03	0.06

Distributions to shareholders from
Net investment income	- 0.01	0 ¹	- 0.01	- 0.03	- 0.06

Net asset value, end of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Total return	0.68 %	0.32 %	1.14 %	3.20 %	5.84 %
Ratios and supplemental data
Net assets, end of period (millions)	$ 3,027	$ 6,261	$ 10,628	$ 9,605	$ 2,302
Ratios to average net assets
Expenses ²	0.94 %	0.93 %	0.89 %	0.88 %	0.84 %
Net investment income	0.60 %	0.33 %	1.12 %	2.42 %	5.54 %

	Year Ended January 31,
CLASS B	2005	2004	2003	2002	2001
Net asset value, beginning of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Income from investment operations
Net investment income	0	0	0	0.02	0.05

Distributions to shareholders from
Net investment income	0 ¹	0 ¹	0 ¹	- 0.02	- 0.05

Net asset value, end of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Total return ³	0.21 %	0.06 %	0.44 %	2.48 %	5.11 %
Ratios and supplemental data
Net assets, end of period (millions)	$ 46	$ 70	$ 113	$ 92	$ 52
Ratios to average net assets
Expenses ²	1.38 %	1.20 %	1.59 %	1.57 %	1.54 %
Net investment income	0.18 %	0.06 %	0.41 %	2.25 %	4.95 %

1. Amount represents less than $0.005 per share.

2. The ratio of expenses to average net assets excludes expense reductions but includes fee waivers and/or expense reimbursements.

3. Excluding applicable sales charges

	Year Ended January 31,
CLASS C	2005	2004	2003	2002	2001
Net asset value, beginning of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Income from investment operations
Net investment income	0	0	0	0.02	0.05

Distributions to shareholders from
Net investment income	0 ¹	0 ¹	0 ¹	- 0.02	- 0.05

Net asset value, end of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Total return ²	0.21 %	0.06 %	0.44 %	2.48 %	5.11 %
Ratios and supplemental data
Net assets, end of period (millions)	$ 16	$ 26	$ 23	$ 15	$ 9
Ratios to average net assets
Expenses ³	1.37 %	1.17 %	1.59 %	1.57 %	1.55 %
Net investment income	0.15 %	0.06 %	0.42 %	2.24 %	4.99 %

	Year Ended January 31,
CLASS I ⁴	2005	2004	2003	2002	2001
Net asset value, beginning of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Income from investment operations
Net investment income	0.01	0.01	0.01	0.03	0.06

Distributions to shareholders from
Net investment income	- 0.01	- 0.01	- 0.01	- 0.03	- 0.06

Net asset value, end of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Total return	0.97 %	0.57 %	1.42 %	3.50 %	6.15 %
Ratios and supplemental data
Net assets, end of period (millions)	$ 1,531	$ 1,659	$ 2,334	$ 2,685	$ 1,964
Ratios to average net assets
Expenses ³	0.65 %	0.68 %	0.61 %	0.56 %	0.54 %
Net investment income	0.94 %	0.57 %	1.41 %	3.43 %	5.97 %

1. Amount represents less than $0.005 per share.

2. Excluding applicable sales charges

3. The ratio of expenses to average net assets excludes expense reductions but includes fee waivers and/or expense reimbursements.

4. Effective at the close of business on May 11, 2001, Class Y shares were renamed as Institutional shares (Class I).

Municipal Money Market Fund

	Year Ended January 31,
CLASS A	2005	2004	2003	2002	2001
Net asset value, beginning of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Income from investment operations
Net investment income	0.01	0.01	0.01	0.02	0.04

Distributions to shareholders from
Net investment income	- 0.01	- 0.01	- 0.01	- 0.02	- 0.04
Net asset value, end of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Total return	0.68 %	0.51 %	0.95 %	2.18 %	3.69 %
Ratios and supplemental data
Net assets, end of period (millions)	$ 763	$ 958	$ 1,237	$ 953	$ 126
Ratios to average net assets
Expenses ¹	0.83 %	0.85 %	0.86 %	0.88 %	0.86 %
Net investment income	0.65 %	0.50 %	0.89 %	1.47 %	3.59 %

	Year Ended January 31,
CLASS I ²	2005	2004	2003	2002	2001
Net asset value, beginning of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Income from investment operations
Net investment income	0.01	0.01	0.01	0.02	0.04
Distributions to shareholders from
Net investment income	- 0.01	- 0.01	- 0.01	- 0.02	- 0.04

Net asset value, end of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Total return	0.98 %	0.81 %	1.25 %	2.49 %	4.00 %
Ratios and supplemental data
Net assets, end of period (millions)	$ 492	$ 513	$ 561	$ 489	$ 512
Ratios to average net assets
Expenses ¹	0.52 %	0.55 %	0.56 %	0.56 %	0.56 %
Net investment income	0.96 %	0.80 %	1.20 %	2.46 %	3.89 %

1. The ratio of expenses to average net assets excludes expense reductions but includes fee waivers and/or expense reimbursements.

2. Effective at the close of business on May 11, 2001, Class Y shares were renamed as Institutional shares (Class I).

New Jersey Municipal Money Market Fund

	Year Ended January 31,
CLASS A	2005	2004	2003	2002	2001
Net asset value, beginning of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Income from investment operations
Net investment income	0.01	0.01	0.01	0.02	0.03
Distributions to shareholders from
Net investment income	- 0.01	- 0.01	- 0.01	- 0.02	- 0.03
Net asset value, end of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Total return	0.65 %	0.53 %	0.90 %	2.11 %	3.45 %
Ratios and supplemental data
Net assets, end of period (millions)	$ 23	$ 30	$ 42	$ 37	$ 34
Ratios to average net assets
Expenses ¹	0.89 %	0.87 %	0.86 %	0.85 %	0.82 %
Net investment income	0.62 %	0.49 %	0.81 %	2.01 %	3.38 %

	Year Ended January 31,
CLASS I ²	2005	2004	2003	2002	2001
Net asset value, beginning of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Income from investment operations
Net investment income	0.01	0.01	0.01	0.02	0.04
Distributions to shareholders from
Net investment income	- 0.01	- 0.01	- 0.01	- 0.02	- 0.04
Net asset value, end of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Total return	0.95 %	0.83 %	1.21 %	2.42 %	3.76 %
Ratios and supplemental data
Net assets, end of period (millions)	$ 5	$ 22	$ 21	$ 6	$ 2
Ratios to average net assets
Expenses ¹	0.59 %	0.57 %	0.56 %	0.55 %	0.53 %
Net investment income	0.89 %	0.73 %	1.04 %	2.32 %	3.69 %

1. The ratio of expenses to average net assets excludes expense reductions but includes fee waivers and/or expense reimbursements.

2. Effective at the close of business on May 11, 2001, Class Y shares were renamed as Institutional shares (Class I).

New York Municipal Money Market Fund

	Year Ended January 31,
CLASS A	2005	2004	2003	2002 ¹
Net asset value, beginning of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Income from investment operations
Net investment income	0.01	0	0.01	0

Distributions to shareholders from
Net investment income	- 0.01	0 ²	- 0.01	0 ²

Net asset value, end of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Total return	0.58 %	0.46 %	0.82 %	0.33 %
Ratios and supplemental data
Net assets, end of period (thousands)	$ 78,542	$ 82,110	$ 101,114	$ 94,200
Ratios to average net assets
Expenses ³	0.87 %	0.91 %	0.88 %	0.88 %⁴
Net investment income	0.58 %	0.39 %	0.79 %	0.92 %⁴

	Year Ended January 31,
CLASS I	2005	2004	2003	2002 ¹
Net asset value, beginning of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Income from investment operations
Net investment income	0.01	0	0.01	0

Distributions to shareholders from
Net investment income	- 0.01	0 ²	- 0.01	0 ²

Net asset value, end of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Total return	0.89 %	0.76 %	1.12 %	0.44 %
Ratios and supplemental data
Net assets, end of period (thousands)	$ 3,420	$ 2,200	$ 676	$ 3,710
Ratios to average net assets
Expenses ³	0.56 %	0.59 %	0.57 %	0.59 %⁴
Net investment income	0.92 %	0.65 %	1.08 %	1.15 %⁴

1. For the period from September 24, 2001 (commencement of class operations), to January 31, 2002.

2. Amount represents less than $0.005 per share.

3. The ratio of expenses to average net assets excludes expense reductions but includes fee waivers and/or expense reimbursements.

4. Annualized

Pennsylvania Municipal Money Market Fund

	Year Ended January 31,
CLASS A	2005	2004	2003	2002	2001
Net asset value, beginning of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Income from investment operations
Net investment income	0.01	0.01	0.01	0.02	0.04

Distributions to shareholders from
Net investment income	- 0.01	- 0.01	- 0.01	- 0.02	- 0.04

Net asset value, end of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Total return	0.71 %	0.52 %	1.10 %	2.27 %	3.66 %
Ratios and supplemental data
Net assets, end of period (millions)	$ 26	$ 32	$ 31	$ 28	$ 19
Ratios to average net assets
Expenses ¹	0.81 %	0.81 %	0.66 %	0.64 %	0.65 %
Net investment income	0.70 %	0.53 %	1.03 %	2.17 %	3.59 %

	Year Ended January 31,
CLASS I ²	2005	2004	2003	2002	2001
Net asset value, beginning of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Income from investment operations
Net investment income	0.01	0.01	0.01	0.02	0.04

Distributions to shareholders from
Net investment income	- 0.01	- 0.01	- 0.01	- 0.02	- 0.04

Net asset value, end of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Total return	1.01 %	0.83 %	1.29 %	2.43 %	3.82 %
Ratios and supplemental data
Net assets, end of period (millions)	$ 66	$ 76	$ 66	$ 80	$ 71
Ratios to average net assets
Expenses ¹	0.51 %	0.51 %	0.47 %	0.48 %	0.49 %
Net investment income	0.98 %	0.81 %	1.23 %	2.31 %	3.73 %

1. The ratio of expenses to average net assets excludes expense reductions but includes fee waivers and/or expense reimbursements.

2. Effective at the close of business on May 11, 2001, Class Y shares were renamed as Institutional shares (Class I).

Treasury Money Market Fund

	Year Ended January 31,
CLASS A	2005	2004	2003	2002	2001
Net asset value, beginning of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Income from investment operations
Net investment income	0.01	0	0.01	0.03	0.06

Distributions to shareholders from
Net investment income	- 0.01	0 ¹	- 0.01	- 0.03	- 0.06

Net asset value, end of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Total return	0.73 %	0.38 %	1.14 %	3.00 %	5.65 %
Ratios and supplemental data
Net assets, end of period (millions)	$ 478	$ 525	$ 773	$ 752	$ 743
Ratios to average net assets
Expenses ²	0.73 %	0.75 %	0.73 %	0.70 %	0.73 %
Net investment income	0.72 %	0.38 %	1.13 %	2.98 %	5.27 %

	Year Ended January 31,
CLASS I ³	2005	2004	2003	2002	2001
Net asset value, beginning of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Income from investment operations
Net investment income	0.01	0.01	0.01	0.03	0.06

Distributions to shareholders from
Net investment income	- 0.01	- 0.01	- 0.01	- 0.03	- 0.06

Net asset value, end of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Total return	1.03 %	0.68 %	1.44 %	3.31 %	5.97 %
Ratios and supplemental data
Net assets, end of period (millions)	$ 1,145	$ 1,652	$ 1,201	$ 1,005	$ 1,032
Ratios to average net assets
Expenses ²	0.43 %	0.45 %	0.43 %	0.40 %	0.43 %
Net investment income	0.97 %	0.66 %	1.42 %	3.21 %	5.78 %

1. Amount represents less than $0.005 per share.

2. The ratio of expenses to average net assets excludes expense reductions but includes fee waivers and/or expense reimbursements.

3. Effective at the close of business on May 11, 2001, Class Y shares were renamed as Institutional shares (Class I).

U.S. Government Money Market Fund

	Year Ended January 31,
CLASS A	2005	2004	2003	2002 ¹
Net asset value, beginning of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Income from investment operations
Net investment income	0.01	0	0.01	0.01

Distributions to shareholders from
Net investment income	- 0.01	0 ²	- 0.01	- 0.01

Net asset value, end of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Total return	0.68 %	0.26 %	1.01 %	1.33 %
Ratios and supplemental data
Net assets, end of period (thousands)	$ 901,382	$ 2,115,472	$ 3,979,856	$ 3,774,155
Ratios to average net assets
Expenses ³	0.88 %	0.93 %	0.88 %	0.88 %⁴
Net investment income	0.57 %	0.27 %	1.00 %	1.57 %⁴

1. For the period from June 26, 2001 (commencement of class operations), to January 31, 2002.

2. Amount represents less than $0.005 per share.

3. The ratio of expenses to average net assets excludes expense reductions but includes fee waivers and/or expense reimbursements.

4. Annualized

OTHER FUND PRACTICES

Taxable securities in which California Municipal Money Market Fund, Florida Municipal Money Market Fund, Municipal Money Market Fund, New Jersey Municipal Money Market Fund, New York Municipal Money Market Fund and Pennsylvania Municipal Money Market Fund may invest on a short-term basis include obligations of the U.S. government, its agencies or instrumentalities, including repurchase agreements with banks or securities dealers involving such securities; time deposits maturing in not more than seven days; other debt securities rated within the two highest rating categories by any nationally recognized statistical ratings organization; commercial paper rated in the highest grade by Moody’s Investors Service, Inc. or Standard & Poor’s Ratings Services; and certificates of deposit issued by U.S. branches of U.S. banks with assets of $1 billion or more.

California Municipal Money Market Fund, Florida Municipal Money Market Fund, New Jersey Municipal Money Market Fund, New York Municipal Money Market Fund and Pennsylvania Municipal Money Market Fund do not intend to concentrate their investments in any one industry. However, from time to time, a Fund may invest 25% or more of its assets in municipal securities which are related in such a way that an economic, business or political development or change affecting one such obligation would also affect the others. Two examples of obligations related in this way are (i) an obligation, the interest on which is paid from revenues of similar type projects and (ii) obligations whose issuers are located in the same state.

Please consult the SAI for more information regarding these and other investment practices used by the Funds, including related risks.

FUND GOVERNANCE

See the SAI for additional information about the Board of Trustees, including Trustees’ compensation, Evergreen fund ownership by the Trustees, committee memberships and responsibilities.

The following individuals currently serve as Trustees of the Evergreen funds:

Independent Trustees:

Interested Trustee:

Mr. Wagoner is an “interested person” of the Evergreen funds because of his ownership of shares of Wachovia Corporation, the parent to EIMC, the Evergreen funds’ investment advisor.

FUND OPERATING POLICIES AND PROCEDURES

Short-Term Trading

Fund Pricing

Portfolio Holdings

Transactions with Affiliates

Proxy Voting

Privacy

Evergreen Express Line

Call 1.800.346.3858

24 hours a day to

check your account
order a statement
get a Fund’s current price, yield and total return
buy, redeem or exchange Fund shares

Shareholder Services

Call 1.800.343.2898

Monday-Friday, 8 a.m. to 6 p.m. Eastern time to

buy, redeem or exchange Fund shares
order applications
get assistance with your account

Information Line for Hearing and Speech Impaired (TTY/TDD)

Call 1.800.343.2888

Monday-Friday, 8 a.m. to 6 p.m. Eastern time

Write us a letter

· Evergreen Investments

· P.O. Box 8400

· Boston, MA 02266-8400

to buy, redeem or exchange Fund shares
to change the registration on your account
for general correspondence

For express, registered or certified mail

· Evergreen Investments

· 66 Brooks Drive, Suite 8400

· Braintree, MA 02184-3800

Visit us on-line

Confirmation Notices— A confirmation of your transaction, other than SIP and SWP, is sent within five days. Please review and promptly notify Evergreen funds of any inaccuracies.

Annual and Semi-annual Reports— You will receive a detailed financial report on each Fund you invest in twice a year.

Tax Forms— Each January you will receive any Fund tax information you need to complete your tax returns.

For More Information About the Evergreen Money Market Funds, Ask for:

Each Fund's most recent Annual or Semi-annual Report, which contains a complete financial accounting for each Fund and a complete list of each Fund's portfolio holdings as of a specific date, as well as commentary from each Fund’s portfolio managers. These reports discuss the market conditions and investment strategies that significantly affected the Funds' performance during the most recent fiscal year or period.
The Statement of Additional Information (SAI), which contains more detailed information about the Funds and their policies and procedures. The SAI has been filed with the Securities and Exchange Commission (SEC) and its contents are legally considered to be part of this prospectus.

· Evergreen mutual funds are distributed by Evergreen Investment Services, Inc.,

· 200 Berkeley Street, Boston, MA 02116-5034. 536120 RV13 (6/05)

· Evergreen Investments

· 200 Berkeley Street

· Boston, MA 02116-5034

SEC File No.: 811-08555

EVERGREEN MONEY MARKET TRUST

PART A

CLASS S PROSPECTUS

Prospectus, June 1, 2005

Evergreen
Money Market Funds

Evergreen California Municipal Money Market Fund
Evergreen Florida Municipal Money Market Fund
Evergreen Money Market Fund
Evergreen Municipal Money Market Fund
Evergreen New Jersey Municipal Money Market Fund
Evergreen New York Municipal Money Market Fund
Evergreen Pennsylvania Municipal Money Market Fund
Evergreen Treasury Money Market Fund

Class S

FUND RISK/RETURN SUMMARIES:

GENERAL INFORMATION:

The Funds' Investment Advisor
Calculating the Share Price
How to Choose an Evergreen Fund
How to Choose the Share Class That Best Suits You
How to Buy and Redeem Shares
Other Services
The Tax Consequences of Investing in the Funds
More Information about the Funds' Fees and Expenses
Financial Highlights
Other Fund Practices
Fund Governance
Fund Operating Policies and Procedures

In general,

the Funds included in this prospectus provide investors with a selection of investment alternatives which seek a high rate of current income consistent with stability of principal and liquidity. Evergreen Municipal Money Market Fund also seeks current income which is exempt from regular federal income tax and Evergreen California Municipal Money Market Fund, Evergreen Florida Municipal Money Market Fund, Evergreen New Jersey Municipal Money Market Fund, Evergreen New York Municipal Money Market Fund and Evergreen Pennsylvania Municipal Money Market Fund also seek current income which is exempt from regular federal income tax and, generally, applicable state taxes.

Fund Summaries Key

Each Fund's summary is organized around the following basic topics and questions:

INVESTMENT GOAL

INVESTMENT STRATEGY

RISK FACTORS

What are the specific risks for an investor in the Fund?

PERFORMANCE

How well has the Fund performed in the past year? The past five years? The past ten years?

FEES AND EXPENSES

How much does it cost to invest in the Fund?

Overview of Fund Risks

Money Market Funds

typically rely on a combination of the following strategies:

attempting to maintain $1.00 per share net asset value;
investing in high quality, short-term money market instruments, including U.S. government securities;
investing in compliance with industry-standard requirements for money market funds for the quality, maturity and diversification of investments; and
selling a portfolio investment: i) when a portfolio manager believes the issuer's investment fundamentals begin to deteriorate; ii) to take advantage of yield opportunities; iii) when the investment no longer appears to meet the Fund's investment objective; iv) when the Fund must meet redemptions; or v) for other investment reasons which a portfolio manager deems appropriate.

may be appropriate for investors who:

are seeking a conservative investment which invests in relatively safe securities;
are seeking a fund for short-term investment; and
are seeking liquidity.

Following this overview, you will find information on each Fund's specific investment strategies and risks.

Although the Funds seek to preserve the value of your investment at $1.00 per share, it is possible to lose money by investing in the Funds.

Risk Factors For All Mutual Funds

Please remember that an investment in a mutual fund is:

not guaranteed to achieve its investment goal;
not a deposit with a bank;
not insured, endorsed or guaranteed by the FDIC or any government agency; and
subject to investment risks.

The following are some of the most important factors that may affect the value of your investment. Other factors may be described in the discussion following this overview.

Interest Rate Risk

Credit Risk

Concentration Risk

Non-Diversification Risk

California Municipal Money Market Fund

FUND FACTS:

Goals:

· High Current Income Exempt from Federal and California State Income Taxes

· Preservation of Capital

· Liquidity

Principal Investment:

· Municipal Money Market Securities

Class of Shares Offered in this Prospectus:

· Class S

Investment Advisor:

· Evergreen
Investment
Management
Company, LLC

Dividend Payment Schedule:

· Monthly

INVESTMENT GOAL

INVESTMENT STRATEGY

The following supplements the investment strategies discussed in the ''Overview of Fund Risks'' on page 1.

RISK FACTORS

Your investment in the Fund is subject to the risks discussed in the ''Overview of Fund Risks'' on page 1 under the headings:

Interest Rate Risk
Credit Risk
Concentration Risk
Non-Diversification Risk

For further information regarding the Fund's investment strategy and risk factors, see "Other Fund Practices."

PERFORMANCE

The following tables show how the Fund has performed in the past. Past performance is not an indication of future results.

The table below shows the percentage gain for the Class S shares of the Fund in each calendar year since the Class S shares' inception on 9/24/2001. It should give you a general idea of the risks of investing in the Fund. This table includes the effects of Fund expenses.

Year-by-Year Total Return for Class S Shares (%)

1995	1996	1997	1998	1999	2000	2001	2002	2003	2004
							0.68	0.21	0.24

Best Quarter:	4th Quarter 2002	+ 0.21 %
Worst Quarter:	1st Quarter 2004	+ 0.01 %
Year-to-date total return as of 3/31/2005 is +0.21%.

The next table lists the Fund’s average annual total return for Class S shares over the past year and since inception. This table is intended to provide you with some indication of the risks of investing in the Fund.

Average Annual Total Return
(for the period ended 12/31/2004)

	Inception Date of Class	1 year	5 year	10 year	Performance Since 9/24/2001
Class S	9/24/2001	0.24 %	N/A	N/A	0.43 %
3 Mo. T-Bill ¹		1.33 %	N/A	N/A	1.51 %

To obtain current yield information call 1.800.343.2898.

FEES AND EXPENSES

You pay no shareholder transaction fees to the Fund.

Annual Fund Operating Expenses (expenses that are deducted from Fund assets) ²

	Class S
Management Fees	0.45 %
12b-1 Fees	0.60 %
Other Expenses	0.19 %
Total Fund Operating Expenses ³	1.24 %

2. Restated to reflect current fees.

3. The Fund's investment advisor may voluntarily waive its fees and/or reimburse the Fund for certain of its expenses in order to reduce expense ratios. The Fund's investment advisor may cease these voluntary waivers and/or reimbursements at any time. The Annual Fund Operating Expenses listed above do not reflect voluntary fee waivers and/or expense reimbursements. Including any current voluntary fund and/or class level expense reimbursements, Total Fund Operating Expenses were 1.19% for Class S.

Example of Fund Expenses

After:	Class S
1 year	$ 126
3 years	$ 393
5 years	$ 681
10 years	$ 1,500

Florida Municipal Money Market Fund

FUND FACTS:

Goals:

· High Current Income Exempt from Federal and Florida State Taxes

· Preservation of Capital

· Liquidity

· Stability of Principal

Principal Investment:

· Municipal Money Market Securities

Class of Shares Offered in this Prospectus:

· Class S

Investment Advisor:

· Evergreen
Investment
Management
Company, LLC

Dividend Payment Schedule:

· Monthly

INVESTMENT GOAL

INVESTMENT STRATEGY

The following supplements the investment strategies discussed in the ''Overview of Fund Risks'' on page 1.

RISK FACTORS

Your investment in the Fund is subject to the risks discussed in the ''Overview of Fund Risks'' on page 1 under the headings:

Interest Rate Risk
Credit Risk
Concentration Risk
Non-Diversification Risk

For further information regarding the Fund's investment strategy and risk factors, see "Other Fund Practices."

PERFORMANCE

The following tables show how the Fund has performed in the past. Past performance is not an indication of future results.

The table below shows the percentage gain or loss for the Class S shares of the Fund in each calendar year since 10/26/1998. It should give you a general idea of the risks of investing in the Fund by showing how the Fund’s return has varied from year-to-year. This table includes the effects of Fund expenses.

Year-by-Year Total Return for Class S Shares (%) ¹

1995	1996	1997	1998	1999	2000	2001	2002	2003	2004
				2.66	3.33	1.90	0.61	0.21	0.27

Best Quarter:	2nd Quarter 2000	+ 0.90 %¹
Worst Quarter:	1st Quarter 2004	+ 0.01 %
Year-to-date total return as of 3/31/2005 is +0.21%.

The next table lists the Fund’s average annual total return for Class S shares over the past one and five years and since inception. This table is intended to provide you with some indication of the risks of investing in the Fund.

Average Annual Total Return
(for the period ended 12/31/2004) ¹

	Inception Date of Class	1 year	5 year	10 year	Performance Since 10/26/1998
Class S	6/30/2000	0.27 %	1.26 %	N/A	1.52 %
3 Mo. T-Bill ²		1.33 %	2.95 %	N/A	3.29 %

1. Historical performance shown for Class S prior to its inception is based on the performance of Class A, one of the original classes offered. Class A is not offered in this prospectus. The historical returns for Class S have not been adjusted to reflect the effect of the class' 12b-1 fee. These fees are 0.60% for Class S and 0.30% for Class A. If these fees had been reflected, returns for Class S would have been lower.

To obtain current yield information call 1.800.343.2898.

FEES AND EXPENSES

You pay no shareholder transaction fees to the Fund.

Annual Fund Operating Expenses (expenses that are deducted from Fund assets) ³

	Class S
Management Fees	0.40 %
12b-1 Fees	0.60 %
Other Expenses	0.14 %
Total Fund Operating Expenses ⁴	1.14 %

3. Restated to reflect current fees.

Example of Fund Expenses

After:	Class S
1 year	$ 117
3 years	$ 363
5 years	$ 629
10 years	$ 1,390

Money Market Fund

FUND FACTS:

Goals:

· High Current Income

· Preservation of Capital

· Liquidity

Principal Investments:

· Money Market Instruments

· Short-term Corporate Debt Securities

Class of Shares Offered in this Prospectus:

· Class S

Investment Advisor:

· Evergreen
Investment
Management
Company, LLC

Dividend Payment Schedule:

· Monthly

INVESTMENT GOAL

The Fund seeks to achieve as high a level of current income as is consistent with preserving capital and providing liquidity.

INVESTMENT STRATEGY

The following supplements the investment strategies discussed in the ''Overview of Fund Risks'' on page 1.

RISK FACTORS

Your investment in the Fund is subject to the risks discussed in the ''Overview of Fund Risks'' on page 1 under the headings:

Interest Rate Risk
Credit Risk

For further information regarding the Fund's investment strategy and risk factors, see "Other Fund Practices."

PERFORMANCE

The following tables show how the Fund has performed in the past. Past performance is not an indication of future results.

The table below shows the percentage gain or loss for the Class S shares of the Fund in each of the last ten calendar years. It should give you a general idea of the risks of investing in the Fund by showing how the Fund’s return has varied from year-to-year. This table includes the effects of Fund expenses.

Year-by-Year Total Return for Class S Shares (%) ¹

1995	1996	1997	1998	1999	2000	2001	2002	2003	2004
5.66	5.22	5.31	5.26	4.93	5.80	3.27	0.88	0.11	0.31

Best Quarter:	2nd Quarter 2000	+ 1.47 %¹
Worst Quarter:	1st Quarter 2004	+ 0.01 %
Year-to-date total return as of 3/31/2005 is +0.32%.

The next table lists the Fund’s average annual total return for the Class S shares over the past one, five and ten years and since inception. This table is intended to provide you with some indication of the risks of investing in the Fund.

Average Annual Total Return
(for the period ended 12/31/2004) ¹

	Inception Date of Class	1 year	5 year	10 year	Performance Since 11/2/1987
Class S	6/30/2000	0.31 %	2.05 %	3.65 %	4.67 %
3 Mo. T-Bill ²		1.33 %	2.95 %	4.14 %	4.92 %

1. Historical performance shown for Class S prior to its inception is based on the performance of Class I, the original class offered. Class I is not offered in this prospectus. The historical returns for Class S have not been adjusted to reflect the effect of the class' 12b-1 fee. These fees are 0.60% for Class S. Class I does not pay a 12b-1 fee. If these fees had been reflected, returns for Class S would have been lower.

To obtain current yield information call 1.800.343.2898.

FEES AND EXPENSES

You pay no shareholder transaction fees to the Fund.

Annual Fund Operating Expenses (expenses that are deducted from Fund assets) ³

	Class S
Management Fees	0.40 %
12b-1 Fees	0.60 %
Other Expenses	0.30 %
Total Fund Operating Expenses ⁴	1.30 %

3. Restated to reflect current fees.

Example of Fund Expenses

After:	Class S
1 year	$ 132
3 years	$ 412
5 years	$ 713
10 years	$ 1,568

Municipal Money Market Fund

FUND FACTS:

Goals:

· High Current Income Exempt from Regular Federal Income Tax

· Preservation of Capital

· Liquidity

Principal Investment:

· Municipal Money Market Securities

Class of Shares Offered in this Prospectus:

· Class S

Investment Advisor:

· Evergreen
Investment
Management
Company, LLC

Dividend Payment Schedule:

· Monthly

INVESTMENT GOAL

The Fund seeks to achieve as high a level of current income exempt from regular federal income tax, as is consistent with preserving capital and providing liquidity.

INVESTMENT STRATEGY

The following supplements the investment strategies discussed in the ''Overview of Fund Risks'' on page 1.

RISK FACTORS

Your investment in the Fund is subject to the risks discussed in the ''Overview of Fund Risks'' on page 1 under the headings:

Interest Rate Risk
Credit Risk

For further information regarding the Fund's investment strategy and risk factors, see "Other Fund Practices."

PERFORMANCE

The following tables show how the Fund has performed in the past. Past performance is not an indication of future results.

Year-by-Year Total Return for Class S Shares (%) ¹

1995	1996	1997	1998	1999	2000	2001	2002	2003	2004
3.76	3.39	3.49	3.40	3.18	3.70	2.06	0.67	0.23	0.32

Best Quarter:	2nd Quarter 2000	+ 1.04 %¹
Worst Quarter:	3rd Quarter 2003	+ 0.02 %
Year-to-date total return as of 3/31/2005 is +0.21%.

Average Annual Total Return
(for the period ended 12/31/2004) ¹

	Inception Date of Class	1 year	5 year	10 year	Performance Since 11/2/1988
Class S	6/30/2000	0.32 %	1.39 %	2.41 %	3.16 %
3 Mo. T-Bill ²		1.33 %	2.95 %	4.14 %	4.80 %

To obtain current yield information call 1.800.343.2898.

FEES AND EXPENSES

You pay no shareholder transaction fees to the Fund.

Annual Fund Operating Expenses (expenses that are deducted from Fund assets)

	Class S
Management Fees	0.41 %
12b-1 Fees	0.60 %
Other Expenses	0.15 %
Total Fund Operating Expenses ³	1.16 %

Example of Fund Expenses

After:	Class S
1 year	$ 118
3 years	$ 368
5 years	$ 638
10 years	$ 1,409

New Jersey Municipal Money Market Fund

FUND FACTS:

Goals:

· High Current Income Exempt from Federal and New Jersey State Income Taxes

· Preservation of Capital

· Liquidity

· Stability of Principal

Principal Investment:

· Municipal Money Market Securities

Class of Shares Offered in this Prospectus:

· Class S

Investment Advisor:

· Evergreen
Investment
Management
Company, LLC

Dividend Payment Schedule:

· Monthly

INVESTMENT GOAL

INVESTMENT STRATEGY

The following supplements the investment strategies discussed in the ''Overview of Fund Risks'' on page 1.

RISK FACTORS

Your investment in the Fund is subject to the risks discussed in the ''Overview of Fund Risks'' on page 1 under the headings:

Interest Rate Risk
Credit Risk
Concentration Risk
Non-Diversification Risk

For further information regarding the Fund's investment strategy and risk factors, see "Other Fund Practices."

PERFORMANCE

The following tables show how the Fund has performed in the past. Past performance is not an indication of future results.

Year-by-Year Total Return for Class S Shares (%) ¹

1995	1996	1997	1998	1999	2000	2001	2002	2003	2004
				2.54	3.31	1.97	0.62	0.25	0.29

Best Quarter:	2nd Quarter 2000	+ 0.90 %¹
Worst Quarter:	1st Quarter 2004	+ 0.01 %
Year-to-date total return as of 3/31/2005 is +0.22%.

Average Annual Total Return
(for the period ended 12/31/2004) ¹

	Inception Date of Class	1 year	5 year	10 year	Performance Since 10/26/1998
Class S	6/30/2000	0.29 %	1.28 %	N/A	1.52 %
3 Mo. T-Bill ²		1.33 %	2.95 %	N/A	3.29 %

To obtain current yield information call 1.800.343.2898.

FEES AND EXPENSES

You pay no shareholder transaction fees to the Fund.

Annual Fund Operating Expenses (expenses that are deducted from Fund assets) ³

	Class S
Management Fees	0.41 %
12b-1 Fees	0.60 %
Other Expenses	0.17 %
Total Fund Operating Expenses	1.18 %

3. Restated to reflect current fees.

Example of Fund Expenses

After:	Class S
1 year	$ 120
3 years	$ 375
5 years	$ 649
10 years	$ 1,432

New York Municipal Money Market Fund

FUND FACTS:

Goals:

· High Rate of Current Income Exempt from Federal and New York State and New York City Income Taxes

· Preservation of Capital

· Liquidity

Principal Investment:

· Municipal Money Market Securities

Class of Shares Offered in this Prospectus:

· Class S

Investment Advisor:

· Evergreen
Investment
Management
Company, LLC

Dividend Payment Schedule:

· Monthly

INVESTMENT GOAL

INVESTMENT STRATEGY

The following supplements the investment strategies discussed in the ''Overview of Fund Risks'' on page 1.

RISK FACTORS

Your investment in the Fund is subject to the risks discussed in the ''Overview of Fund Risks'' on page 1 under the headings:

Interest Rate Risk
Credit Risk
Concentration Risk
Non-Diversification Risk

For further information regarding the Fund's investment strategy and risk factors, see "Other Fund Practices."

PERFORMANCE

The following tables show how the Fund has performed in the past. Past performance is not an indication of future results.

Year-by-Year Total Return for Class S Shares (%)

1995	1996	1997	1998	1999	2000	2001	2002	2003	2004
							0.52	0.20	0.24

Best Quarter:	4th Quarter 2002	+ 0.16 %
Worst Quarter:	1st Quarter 2004	+ 0.01 %
Year-to-date total return as of 3/31/2005 is +0.20%.

Average Annual Total Return
(for the period ended 12/31/2004)

	Inception Date of Class	1 year	5 year	10 year	Performance Since 9/24/2001
Class S	9/24/2001	0.24 %	N/A	N/A	0.36 %
3 Mo. T-Bill ¹		1.33 %	N/A	N/A	1.51 %

To obtain current yield information call 1.800.343.2898.

FEES AND EXPENSES

You pay no shareholder transaction fees to the Fund.

Annual Fund Operating Expenses (expenses that are deducted from Fund assets)

	Class S
Management Fees	0.40 %
12b-1 Fees	0.60 %
Other Expenses	0.18 %
Total Fund Operating Expenses ²	1.18 %

Example of Fund Expenses

After:	Class S
1 year	$ 120
3 years	$ 375
5 years	$ 649
10 years	$ 1,432

Pennsylvania Municipal Money Market Fund

FUND FACTS:

Goals:

· High Current Income Exempt from Federal and Pennsylvania State Income Taxes

· Preservation of Capital

· Liquidity

Principal Investment:

· Municipal Money Market Securities

Class of Shares Offered in this Prospectus:

· Class S

Investment Advisor:

· Evergreen
Investment
Management
Company, LLC

Dividend Payment Schedule:

· Monthly

INVESTMENT GOAL

INVESTMENT STRATEGY

The following supplements the investment strategies discussed in the ''Overview of Fund Risks'' on page 1.

RISK FACTORS

Your investment in the Fund is subject to the risks discussed in the ''Overview of Fund Risks'' on page 1 under the headings:

Interest Rate Risk
Credit Risk
Concentration Risk
Non-Diversification Risk

For further information regarding the Fund's investment strategy and risk factors, see "Other Fund Practices."

PERFORMANCE

The following tables show how the Fund has performed in the past. Past performance is not an indication of future results.

Year-by-Year Total Return for Class S Shares (%) ¹

1995	1996	1997	1998	1999	2000	2001	2002	2003	2004
3.66	3.07	3.22	3.09	2.96	3.53	1.98	0.70	0.24	0.35

Best Quarter:	2nd Quarter 2000	+ 0.99 %¹
Worst Quarter:	3rd Quarter 2003	+ 0.02 %
Year-to-date total return as of 3/31/2005 is +0.23%.

Average Annual Total Return
(for the period ended 12/31/2004) ¹

	Inception Date of Class	1 year	5 year	10 year	Performance Since 8/15/1991
Class S	6/30/2000	0.35 %	1.35 %	2.27 %	2.39 %
3 Mo. T-Bill ²		1.33 %	2.95 %	4.14 %	4.12 %

To obtain current yield information call 1.800.343.2898.

FEES AND EXPENSES

You pay no shareholder transaction fees to the Fund.

Annual Fund Operating Expenses (expenses that are deducted from Fund assets) ³

	Class S
Management Fees	0.36 %
12b-1 Fees	0.60 %
Other Expenses	0.18 %
Total Fund Operating Expenses	1.14 %

3. Restated to reflect current fees.

Example of Fund Expenses

After:	Class S
1 year	$ 116
3 years	$ 362
5 years	$ 628
10 years	$ 1,386

Treasury Money Market Fund

FUND FACTS:

Goals:

· Stability of Principal

· Current Income

· Liquidity

Principal Investments:

· Short-term U.S. Treasury Obligations

· Repurchase Agreements backed by Short-term U.S. Treasury Obligations

Class of Shares Offered in this Prospectus:

· Class S

Investment Advisor:

· Evergreen
Investment
Management
Company, LLC

Dividend Payment Schedule:

· Monthly

INVESTMENT GOAL

The Fund seeks to maintain stability of principal while earning current income and providing liquidity.

INVESTMENT STRATEGY

The following supplements the investment strategies discussed in the ''Overview of Fund Risks'' on page 1.

The Fund maintains an average dollar-weighted maturity of 60 days or less.

RISK FACTORS

Your investment in the Fund is subject to the risks discussed in the ''Overview of Fund Risks'' on page 1 under the headings:

Interest Rate Risk
Credit Risk

For further information regarding the Fund's investment strategy and risk factors, see "Other Fund Practices."

PERFORMANCE

The following tables show how the Fund has performed in the past. Past performance is not an indication of future results.

Year-by-Year Total Return for Class S Shares (%) ¹

1995	1996	1997	1998	1999	2000	2001	2002	2003	2004
5.38	4.78	4.91	4.83	4.33	5.43	3.04	0.91	0.13	0.35

Best Quarter:	4th Quarter 2000	+ 1.39 %
Worst Quarter:	2nd Quarter 2004	+ 0.01 %
Year-to-date total return as of 3/31/2005 is +0.32%.

Average Annual Total Return
(for the period ended 12/31/2004) ¹

	Inception Date of Class	1 year	5 year	10 year	Performance Since 3/6/1991
Class S	6/30/2000	0.35 %	1.95 %	3.39 %	3.49 %
3 Mo. T-Bill ²		1.33 %	2.95 %	4.14 %	4.19 %

To obtain current yield information call 1.800.343.2898.

FEES AND EXPENSES

You pay no shareholder transaction fees to the Fund.

Annual Fund Operating Expenses (expenses that are deducted from Fund assets) ³

	Class S
Management Fees	0.31 %
12b-1 Fees	0.60 %
Other Expenses	0.12 %
Total Fund Operating Expenses	1.03 %

3. Restated to reflect current fees.

Example of Fund Expenses

After:	Class S
1 year	$ 105
3 years	$ 328
5 years	$ 569
10 years	$ 1,259

THE FUNDS' INVESTMENT ADVISOR

For the fiscal year ended 1/31/2005, the aggregate advisory fee paid to investment advisor by each Fund was as follows:

Fund	% of the Fund's average daily net assets
California Municipal Money Market Fund	0.44 %
Florida Municipal Money Market Fund	0.39 %
Money Market Fund	0.40 %
Municipal Money Market Fund	0.37 %
New Jersey Municipal Money Market Fund	0.40 %
New York Municipal Money Market Fund	0.37 %
Pennsylvania Municipal Money Market Fund	0.36 %
Treasury Money Market Fund	0.31 %

Legal Proceedings

CALCULATING THE SHARE PRICE

HOW TO CHOOSE AN EVERGREEN FUND

When choosing an Evergreen fund, you should:

Most importantly, read the prospectus to see if the Fund is suitable for you.
Consider talking to an investment professional. He or she is qualified to give you investment advice based on your investment goals and financial situation and will be able to answer questions you may have after reading the Fund's prospectus. He or she can also assist you through all phases of opening your account.
Request any additional information you want about the Fund, such as the Statement of Additional Information (SAI), Annual Report or Semi-annual Report by calling 1.800.343.2898. In addition, any of these documents may be downloaded off our website at EvergreenInvestments.com.

HOW TO CHOOSE THE SHARE CLASS THAT BEST SUITS YOU

After choosing a Fund, you select a share class. The Funds offer up to six different share classes, each with its own fee and expense structure. Only Class S shares are offered in this prospectus.

Class S

Each Fund offers Class S shares at NAV without a front-end sales charge or deferred sales charge. However, Class S shares are subject to 12b-1 fees. Class S shares are typically purchased in connection with “sweep programs" made available by broker-dealers or other financial intermediaries. Such broker-dealers or financial intermediaries may impose account fees or other charges and certain broker-dealers and other financial institutions may impose a fee in connection with purchases of Class S shares of the Funds.

Promotional Incentives on Dealer Commissions

Additional Compensation to Financial Services Firms

HOW TO BUY AND REDEEM SHARES

Class S shares are sold through certain broker-dealers and financial institutions which have selling agreements with EIS. You can also redeem your Class S shares of the Funds at NAV through certain broker-dealers and financial institutions which have selling agreements with EIS on any day the New York Stock Exchange is open pursuant to the Funds' procedures. Investors should refer to their broker-dealer or financial institution as appropriate for instruction and further information.

OTHER SERVICES

Automatic Reinvestment of Distributions

THE TAX CONSEQUENCES OF INVESTING
IN THE FUNDS

Fund Distributions

A mutual fund passes along to all of its shareholders the net income or profits it receives from its investments. The shareholders of the fund then pay any taxes due, whether they receive these distributions in cash or elect to have them reinvested. California Municipal Money Market Fund, Florida Municipal Money Market Fund, Municipal Money Market Fund, New Jersey Municipal Money Market Fund, New York Municipal Money Market Fund and Pennsylvania Municipal Money Market Fund expect that substantially all of their regular dividends will be exempt from federal income tax other than the alternative minimum tax. Otherwise, the Funds will distribute two types of taxable income to you:

Dividends. To the extent that regular dividends are derived from investment income that is not tax-exempt, or from short-term capital gains, you will have to include them in your federal taxable income. Each Fund pays a monthly dividend from the dividends, interest and other income on the securities in which it invests.
Capital Gains. When a mutual fund sells a security it owns for a profit, the result is a capital gain. The Funds generally distribute capital gains, if any, at least once a year, near the end of the calendar year. Short-term capital gains reflect securities held by the Funds for a year or less and are considered ordinary income just like dividends. Profits on securities held longer than 12 months are considered long-term capital gains when they are distributed to shareholders. Individual shareholders receiving such distributions are taxed at a maximum rate no higher than 15%. It is not anticipated that any significant capital gains will be realized by the Funds.
Alternative Minimum Tax. An investment in California Municipal Money Market Fund, Florida Municipal Money Market Fund, Municipal Money Market Fund, New Jersey Municipal Money Market Fund, New York Municipal Money Market Fund and Pennsylvania Municipal Money Market Fund may result in liability for federal alternative minimum tax (AMT), both for individual and corporate shareholders. For example, while the interest from qualified private activity bonds is generally not subject to federal income tax, many types of private activity bond interest must be included in taxable income for federal AMT purposes.

Dividend and Capital Gain Reinvestment

Profits You Realize When You Redeem Shares

Tax Reporting

Your broker-dealer or financial institution provides you and the IRS with a tax statement of your dividend and capital gains distributions for each calendar year on Form 1099 DIV. Proceeds from a sale are reported on Form 1099B. You must report these on your tax return. You could pay a penalty if you neglect to report them.

MORE INFORMATION ABOUT THE FUNDS' FEES AND EXPENSES

Every mutual fund has fees and expenses that are assessed either directly or indirectly. This section describes each of those fees.

OVERVIEW OF FEES AND EXPENSES

ANNUAL FUND OPERATING EXPENSES (expenses that are deducted from Fund assets)

An investment in an Evergreen mutual fund is subject to the following on-going fees, which reduce the overall return earned by an investor:

Management Fee

The management fee is paid by each Fund to the investment advisor for investment advisory services. These services include day-to-day management of the Fund’s portfolio of investments.

Distribution (Rule 12b-1) Fees

Distribution fees -- also known as Rule 12b-1 fees, referring to the SEC rule that authorizes the imposition of the fees -- are paid by a fund to support the marketing and sale of the Fund’s shares. The Trustees of the Evergreen funds have approved a policy to assess annual 12b-1 fees of up to 1.00% of the average daily net assets of Class S shares. However, currently the 12b-1 fees for Class S shares are limited to 0.60% of the average daily net assets of the class. These fees increase the cost of your investment. These fees may pay for marketing and advertising costs. They also may be used to pay commissions and other fees to broker-dealers who provide investment advice or investor services to their clients who have invested in the Fund.

Other Expenses

Total Fund Operating Expenses

PORTFOLIO TRADING COSTS

FINANCIAL HIGHLIGHTS

This section looks in detail at the results for one share in Class S of the Funds -- offered in this prospectus how much income it earned, how much of this income was passed along as a distribution and how much the return was reduced by expenses. The following tables have been derived from financial information audited by KPMG LLP, the Funds' independent registered public accounting firm. For a more complete picture of the Funds' financial statements, please see the Funds' Annual Report as well as the SAI.

California Municipal Money Market Fund

	Year Ended January 31,
CLASS S	2005	2004	2003	2002 ¹
Net asset value, beginning of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Income from investment operations
Net investment income	0	0	0.01	0

Distributions to shareholders from
Net investment income	0 ²	0 ²	- 0.01	0 ²

Net asset value, end of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Total return	0.30 %	0.19 %	0.68 %	0.29 %
Ratios and supplemental data
Net assets, end of period (thousands)	$ 172,467	$ 25,427	$ 41,997	$ 41,972
Ratios to average net assets
Expenses ³	1.16 %	1.15 %	1.11 %	1.19 %⁴
Net investment income	0.53 %	0.20 %	0.65 %	0.83 %⁴

1. For the period from September 24, 2001 (commencement of class operations), to January 31, 2002.

2. Amount represents less than $0.005 per share.

3. The ratio of expenses to average net assets excludes expense reductions but includes fee waivers and/or expense reimbursements.

4. Annualized

Florida Municipal Money Market Fund

	Year Ended January 31,
CLASS S	2005	2004	2003	2002	2001 ¹
Net asset value, beginning of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Income from investment operations
Net investment income	0	0	0.01	0.02	0.02

Distributions to shareholders from
Net investment income	0 ²	0 ²	- 0.01	- 0.02	- 0.02

Net asset value, end of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Total return	0.32 %	0.20 %	0.59 %	1.73 %	1.87 %
Ratios and supplemental data
Net assets, end of period (thousands)	$ 442,868	$ 259,620	$ 242,800	$ 206,592	$ 163,045
Ratios to average net assets
Expenses ³	1.11 %	1.12 %	1.17 %	1.15 %	1.16 %⁴
Net investment income	0.37 %	0.20 %	0.52 %	1.58 %	3.08 %⁴

1. For the period from June 30, 2000 (commencement of class operations), to January 31, 2001.

2. Amount represents less than $0.005 per share.

3. The ratio of expenses to average net assets excludes expense reductions but includes fee waivers and/or expense reimbursements.

4. Annualized

Money Market Fund

	Year Ended January 31,
CLASS S	2005	2004	2003	2002	2001 ¹
Net asset value, beginning of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Income from investment operations
Net investment income	0	0	0.01	0.03	0.03

Distributions to shareholders from
Net investment income	0 ²	0 ²	- 0.01	- 0.03	- 0.03

Net asset value, end of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Total return	0.41 %	0.09 %	0.82 %	2.89 %	3.33 %
Ratios and supplemental data
Net assets, end of period (millions)	$ 2,477	$ 3,544	$ 7,302	$ 9,954	$ 10,771
Ratios to average net assets
Expenses ³	1.20 %	1.17 %	1.21 %	1.16 %	1.15 %⁴
Net investment income	0.39 %	0.10 %	0.83 %	2.89 %	5.56 %⁴

1. For the period from June 30, 2000 (commencement of class operations), to January 31, 2001.

2. Amount represents less than $0.005 per share.

3. The ratio of expenses to average net assets excludes expense reductions but includes fee waivers and/or expense reimbursements.

4. Annualized

Municipal Money Market Fund

	Year Ended January 31,
CLASS S	2005	2004	2003	2002	2001 ¹
Net asset value, beginning of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Income from investment operations
Net investment income	0	0	0.01	0.02	0.02
Distributions to shareholders from
Net investment income	0 ²	0 ²	- 0.01	- 0.02	- 0.02
Net asset value, end of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Total return	0.38 %	0.21 %	0.65 %	1.88 %	1.99 %
Ratios and supplemental data
Net assets, end of period (millions)	$ 319	$ 463	$ 835	$ 638	$ 574
Ratios to average net assets
Expenses ³	1.13 %	1.13 %	1.16 %	1.16 %	1.16 %⁴
Net investment income	0.34 %	0.22 %	0.60 %	1.82 %	3.31 %⁴

1. For the period from June 30, 2000 (commencement of class operations), to January 31, 2001.

2. Amount represents less than $0.005 per share.

3. The ratio of expenses to average net assets excludes expense reductions but includes fee waivers and/or expense reimbursements.

4. Annualized

New Jersey Municipal Money Market Fund

	Year Ended January 31,
CLASS S	2005	2004	2003	2002	2001 ¹
Net asset value, beginning of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Income from investment operations
Net investment income	0	0	0.01	0.02	0.02
Distributions to shareholders from
Net investment income	0 ²	0 ²	- 0.01	- 0.02	- 0.02
Net asset value, end of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Total return	0.35 %	0.24 %	0.60 %	1.81 %	1.84 %
Ratios and supplemental data
Net assets, end of period (millions)	$ 171	$ 66	$ 108	$ 136	$ 98
Ratios to average net assets
Expenses ³	1.16 %	1.16 %	1.16 %	1.15 %	1.14 %⁴
Net investment income	0.48 %	0.19 %	0.51 %	1.71 %	3.07 %⁴

1. For the period from June 30, 2000 (commencement of class operations), to January 31, 2001.

2. Amount represents less than $0.005 per share.

3. The ratio of expenses to average net assets excludes expense reductions but includes fee waivers and/or expense reimbursements.

4. Annualized

New York Municipal Money Market Fund

	Year Ended January 31,
CLASS S	2005	2004	2003	2002 ¹
Net asset value, beginning of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Income from investment operations
Net investment income	0	0	0.01	0

Distributions to shareholders from
Net investment income	0 ²	0 ²	- 0.01	0 ²

Net asset value, end of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Total return	0.30 %	0.19 %	0.52 %	0.22 %
Ratios and supplemental data
Net assets, end of period (thousands)	$ 289,872	$ 25,407	$ 35,817	$ 24,092
Ratios to average net assets
Expenses ³	1.11 %	1.18 %	1.18 %	1.18 %⁴
Net investment income	0.54 %	0.13 %	0.49 %	0.54 %⁴

1. For the period from September 24, 2001 (commencement of class operations), to January 31, 2002.

2. Amount represents less than $0.005 per share.

3. The ratio of expenses to average net assets excludes expense reductions but includes fee waivers and/or expense reimbursements.

4. Annualized

Pennsylvania Municipal Money Market Fund

	Year Ended January 31,
CLASS S	2005	2004	2003	2002	2001 ¹
Net asset value, beginning of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Income from investment operations
Net investment income	0	0	0.01	0.02	0.02

Distributions to shareholders from
Net investment income	0 ²	0 ²	- 0.01	- 0.02	- 0.02

Net asset value, end of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Total return	0.41 %	0.23 %	0.69 %	1.82 %	1.89 %
Ratios and supplemental data
Net assets, end of period (millions)	$ 62	$ 71	$ 137	$ 155	$ 140
Ratios to average net assets
Expenses ³	1.11 %	1.11 %	1.07 %	1.08 %	1.09 %⁴
Net investment income	0.41 %	0.23 %	0.62 %	1.79 %	3.17 %⁴

1. For the period from June 30, 2000 (commencement of class operations), to January 31, 2001.

2. Amount represents less than $0.005 per share.

3. The ratio of expenses to average net assets excludes expense reductions but includes fee waivers and/or expense reimbursements.

4. Annualized

Treasury Money Market Fund

	Year Ended January 31,
CLASS S	2005	2004	2003	2002	2001 ¹
Net asset value, beginning of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Income from investment operations
Net investment income	0	0	0.01	0.03	0.03

Distributions to shareholders from
Net investment income	0 ²	0 ²	- 0.01	- 0.03	- 0.03

Net asset value, end of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Total return	0.44 %	0.11 %	0.84 %	2.70 %	3.24 %
Ratios and supplemental data
Net assets, end of period (millions)	$ 761	$ 856	$ 1,484	$ 1,826	$ 2,135
Ratios to average net assets
Expenses ³	1.01 %	1.02 %	1.03 %	1.00 %	1.04 %⁴
Net investment income	0.43 %	0.12 %	0.85 %	2.71 %	5.50 %⁴

1. For the period from June 30, 2000 (commencement of class operations), to January 31, 2001.

2. Amount represents less than $ 0.005 per share.

3. The ratio of expenses to average net assets excludes expense reductions but includes fee waivers and/or expense reimbursements.

4. Annualized

OTHER FUND PRACTICES

Please consult the SAI for more information regarding these and other investment practices used by the Funds, including related risks.

FUND GOVERNANCE

See the SAI for additional information about the Board of Trustees, including Trustees’ compensation, Evergreen fund ownership by the Trustees, committee memberships and responsibilities.

The following individuals currently serve as Trustees of the Evergreen funds:

Independent Trustees:

Interested Trustee:

Mr. Wagoner is an “interested person” of the Evergreen funds because of his ownership of shares of Wachovia Corporation, the parent to EIMC, the Evergreen funds’ investment advisor.

FUND OPERATING POLICIES AND PROCEDURES

Short-Term Trading

Fund Pricing

Portfolio Holdings

Transactions with Affiliates

Proxy Voting

Privacy

For More Information About the Evergreen Money Market Funds, Ask for:

Each Fund's most recent Annual or Semi-annual Report, which contains a complete financial accounting for each Fund and a complete list of each Fund's portfolio holdings as of a specific date, as well as commentary from each Fund’s portfolio managers. These reports discuss the market conditions and investment strategies that significantly affected the Funds' performance during the most recent fiscal year or period.
The Statement of Additional Information (SAI), which contains more detailed information about the Funds and their policies and procedures. The SAI has been filed with the Securities and Exchange Commission (SEC) and its contents are legally considered to be part of this prospectus.

· Evergreen mutual funds are distributed by Evergreen Investment Services, Inc.,

· 200 Berkeley Street, Boston, MA 02116-5034. 554285 RV6 (6/05)

· Evergreen Investments

· 200 Berkeley Street

· Boston, MA 02116-5034

SEC File No.: 811-08555

EVERGREEN MONEY MARKET TRUST

PART A

CLASSES S/S1 PROSPECTUS

Prospectus, June 1, 2005

Evergreen
Money Market Funds

Evergreen California Municipal Money Market Fund
Evergreen Florida Municipal Money Market Fund
Evergreen Money Market Fund
Evergreen Municipal Money Market Fund
Evergreen New Jersey Municipal Money Market Fund
Evergreen New York Municipal Money Market Fund
Evergreen Pennsylvania Municipal Money Market Fund
Evergreen Treasury Money Market Fund
Evergreen U.S. Government Money Market Fund

Class S
Class S1

FUND RISK/RETURN SUMMARIES:

GENERAL INFORMATION:

In general,

the Funds included in this prospectus provide investors with a selection of investment alternatives which seek a high rate of current income consistent with stability of principal and liquidity. Evergreen Municipal Money Market Fund also seeks current income which is exempt from regular federal income tax and Evergreen California Municipal Money Market Fund, Evergreen Florida Municipal Money Market Fund, Evergreen New Jersey Municipal Money Market Fund, Evergreen New York Municipal Money Market Fund and Evergreen Pennsylvania Municipal Money Market Fund also seek current income which is exempt from regular federal income tax and, generally, applicable state taxes.

Fund Summaries Key

Each Fund's summary is organized around the following basic topics and questions:

INVESTMENT GOAL

INVESTMENT STRATEGY

RISK FACTORS

What are the specific risks for an investor in the Fund?

PERFORMANCE

How well has the Fund performed in the past year? The past five years? The past ten years?

FEES AND EXPENSES

How much does it cost to invest in the Fund?

Overview of Fund Risks

Money Market Funds

typically rely on a combination of the following strategies:

attempting to maintain $1.00 per share net asset value;
investing in high quality, short-term money market instruments, including U.S. government securities;
investing in compliance with industry-standard requirements for money market funds for the quality, maturity and diversification of investments; and
selling a portfolio investment: i) when a portfolio manager believes the issuer's investment fundamentals begin to deteriorate; ii) to take advantage of yield opportunities; iii) when the investment no longer appears to meet the Fund's investment objective; iv) when the Fund must meet redemptions; or v) for other investment reasons which a portfolio manager deems appropriate.

may be appropriate for investors who:

are seeking a conservative investment which invests in relatively safe securities;
are seeking a fund for short-term investment; and
are seeking liquidity.

Following this overview, you will find information on each Fund's specific investment strategies and risks.

Although the Funds seek to preserve the value of your investment at $1.00 per share, it is possible to lose money by investing in the Funds.

Risk Factors For All Mutual Funds

Please remember that an investment in a mutual fund is:

not guaranteed to achieve its investment goal;
not a deposit with a bank;
not insured, endorsed or guaranteed by the FDIC or any government agency; and
subject to investment risks.

The following are some of the most important factors that may affect the value of your investment. Other factors may be described in the discussion following this overview.

Interest Rate Risk

Credit Risk

Concentration Risk

Non-Diversification Risk

California Municipal Money Market Fund

FUND FACTS:

Goals:

· High Current Income Exempt from Federal and California State Income Taxes

· Preservation of Capital

· Liquidity

Principal Investment:

· Municipal Money Market Securities

Class of Shares Offered in this Prospectus:

· Class S

Investment Advisor:

· Evergreen
Investment
Management
Company, LLC

Dividend Payment Schedule:

· Monthly

INVESTMENT GOAL

INVESTMENT STRATEGY

The following supplements the investment strategies discussed in the ''Overview of Fund Risks'' on page 1.

RISK FACTORS

Your investment in the Fund is subject to the risks discussed in the ''Overview of Fund Risks'' on page 1 under the headings:

Interest Rate Risk
Credit Risk
Concentration Risk
Non-Diversification Risk

For further information regarding the Fund's investment strategy and risk factors, see "Other Fund Practices."

PERFORMANCE

The following tables show how the Fund has performed in the past. Past performance is not an indication of future results.

The table below shows the percentage gain or loss for the Class S shares of the Fund in each calendar year since the Class S shares' inception on 9/24/2001. It should give you a general idea of the risks of investing in the Fund. This table includes the effects of Fund expenses.

Year-by-Year Total Return for Class S Shares (%)

1995	1996	1997	1998	1999	2000	2001	2002	2003	2004
							0.68	0.21	0.24

Best Quarter:	4th Quarter 2002	+ 0.21 %
Worst Quarter:	1st Quarter 2004	+ 0.01 %
Year-to-date total return as of 3/31/2005 is +0.21%.

Average Annual Total Return
(for the period ended 12/31/2004)

	Inception Date of Class	1 year	5 year	10 year	Performance Since 9/24/2001
Class S	9/24/2001	0.24 %	N/A	N/A	0.43 %
3 Mo. T-Bill ¹		1.33 %	N/A	N/A	1.51 %

To obtain current yield information call 1.800.343.2898.

FEES AND EXPENSES

You pay no shareholder transaction fees to the Fund.

Annual Fund Operating Expenses (expenses that are deducted from Fund assets) ²

	Class S
Management Fees	0.45 %
12b-1 Fees	0.60 %
Other Expenses	0.19 %
Total Fund Operating Expenses ³	1.24 %

2. Restated to reflect current fees.

3. The Fund's investment advisor may voluntarily waive its fees and/or reimburse the Fund for certain of its expenses in order to reduce expense ratios. The Fund's investment advisor may cease these voluntary waivers and/or reimbursements at any time. The Annual Fund Operating Expenses listed above do not reflect voluntary fee waivers and/or expense reimbursements. Including any current voluntary fund and/or class level expense reimbursements, Total Fund Operating Expenses were 1.19% for Class S.

Example of Fund Expenses

After:	Class S
1 year	$ 126
3 years	$ 393
5 years	$ 681
10 years	$ 1,500

Florida Municipal Money Market Fund

FUND FACTS:

Goals:

· High Current Income Exempt from Federal and Florida State Taxes

· Preservation of Capital

· Liquidity

· Stability of Principal

Principal Investment:

· Municipal Money Market Securities

Class of Shares Offered in this Prospectus:

· Class S

Investment Advisor:

· Evergreen
Investment
Management
Company, LLC

Dividend Payment Schedule:

· Monthly

INVESTMENT GOAL

INVESTMENT STRATEGY

The following supplements the investment strategies discussed in the ''Overview of Fund Risks'' on page 1.

RISK FACTORS

Your investment in the Fund is subject to the risks discussed in the ''Overview of Fund Risks'' on page 1 under the headings:

Interest Rate Risk
Credit Risk
Concentration Risk
Non-Diversification Risk

For further information regarding the Fund's investment strategy and risk factors, see "Other Fund Practices."

PERFORMANCE

The following tables show how the Fund has performed in the past. Past performance is not an indication of future results.

Year-by-Year Total Return for Class S Shares (%) ¹

1995	1996	1997	1998	1999	2000	2001	2002	2003	2004
				2.66	3.33	1.90	0.61	0.21	0.27

Best Quarter:	2nd Quarter 2000	+ 0.90 %¹
Worst Quarter:	1st Quarter 2004	+ 0.01 %
Year-to-date total return as of 3/31/2005 is +0.21%.

Average Annual Total Return
(for the period ended 12/31/2004) ¹

	Inception Date of Class	1 year	5 year	10 year	Performance Since 10/26/1998
Class S	6/30/2000	0.27 %	1.26 %	N/A	1.52 %
3 Mo. T-Bill ²		1.33 %	2.95 %	N/A	3.29 %

To obtain current yield information call 1.800.343.2898.

FEES AND EXPENSES

You pay no shareholder transaction fees to the Fund.

Annual Fund Operating Expenses (expenses that are deducted from Fund assets) ³

	Class S
Management Fees	0.40 %
12b-1 Fees	0.60 %
Other Expenses	0.14 %
Total Fund Operating Expenses ⁴	1.14 %

3. Restated to reflect current fees.

Example of Fund Expenses

After:	Class S
1 year	$ 117
3 years	$ 363
5 years	$ 629
10 years	$ 1,390

Money Market Fund

FUND FACTS:

Goals:

· High Current Income

· Preservation of Capital

· Liquidity

Principal Investments:

· Money Market Instruments

· Short-term Corporate Debt Securities

Class of Shares Offered in this Prospectus:

· Class S1

Investment Advisor:

· Evergreen
Investment
Management
Company, LLC

Dividend Payment Schedule:

· Monthly

INVESTMENT GOAL

The Fund seeks to achieve as high a level of current income as is consistent with preserving capital and providing liquidity.

INVESTMENT STRATEGY

The following supplements the investment strategies discussed in the ''Overview of Fund Risks'' on page 1.

RISK FACTORS

Your investment in the Fund is subject to the risks discussed in the ''Overview of Fund Risks'' on page 1 under the headings:

Interest Rate Risk
Credit Risk

For further information regarding the Fund's investment strategy and risk factors, see "Other Fund Practices."

PERFORMANCE

The following tables show how the Fund has performed in the past. Past performance is not an indication of future results.

The table below shows the percentage gain or loss for the Class S1 shares of the Fund in each of the last ten calendar years. It should give you a general idea of the risks of investing in the Fund by showing how the Fund’s return has varied from year-to-year. This table includes the effects of Fund expenses.

Year-by-Year Total Return for Class S1 Shares (%) ¹

1995	1996	1997	1998	1999	2000	2001	2002	2003	2004
5.66	5.22	5.31	5.26	4.93	6.11	3.70	1.24	0.25	0.41

Best Quarter:	4th Quarter 2000	+ 1.57 %¹
Worst Quarter:	3rd Quarter 2003	+ 0.01 %
Year-to-date total return as of 3/31/2005 is +0.35%.

The next table lists the Fund’s average annual total return for Class S1 shares over the past one, five and ten years and since inception. This table is intended to provide you with some indication of the risks of investing in the Fund.

Average Annual Total Return
(for the period ended 12/31/2004) ¹

	Inception Date of Class	1 year	5 year	10 year	Performance Since 11/2/1987
Class S1	6/6/2001	0.41 %	2.32 %	3.79 %	4.75 %
3 Mo. T-Bill ²		1.33 %	2.95 %	4.14 %	4.92 %

1. Historical performance shown for Class S1 prior to its inception is based on the performance of Class I, the original class offered. Class I is not offered in this prospectus. The historical returns for Class S1 have not been adjusted to reflect the effect of the class' 12b-1 fees. These fees are 0.60% for Class S1. Class I does not pay a 12b-1 fee. If these fees had been reflected, returns for Class S1 would have been lower.

To obtain current yield information call 1.800.343.2898.

FEES AND EXPENSES

You pay no shareholder transaction fees to the Fund.

Annual Fund Operating Expenses (expenses that are deducted from Fund assets)

	Class S1
Management Fees	0.40 %
12b-1 Fees	0.60 %
Other Expenses	0.30 %
Total Fund Operating Expenses ³	1.30 %

3. The Fund's investment advisor may voluntarily waive its fees and/or reimburse the Fund for certain of its expenses in order to reduce expense ratios. The Fund's investment advisor may cease these voluntary waivers and/or reimbursements at any time. The Annual Fund Operating Expenses listed above do not reflect voluntary fee waivers and/or expense reimbursements. Including any current voluntary fund and/or class level fee waivers and expense reimbursements, Total Fund Operating Expenses were 1.12% for Class S1

Example of Fund Expenses

After:	Class S1
1 year	$ 132
3 years	$ 412
5 years	$ 713
10 years	$ 1,568

Municipal Money Market Fund

FUND FACTS:

Goals:

· High Current Income Exempt from Regular Federal Income Tax

· Preservation of Capital

· Liquidity

Principal Investment:

· Municipal Money Market Securities

Class of Shares Offered in this Prospectus:

· Class S1

Investment Advisor:

· Evergreen
Investment
Management
Company, LLC

Dividend Payment Schedule:

· Monthly

INVESTMENT GOAL

The Fund seeks to achieve as high a level of current income exempt from regular federal income tax, as is consistent with preserving capital and providing liquidity.

INVESTMENT STRATEGY

The following supplements the investment strategies discussed in the ''Overview of Fund Risks'' on page 1.

RISK FACTORS

Your investment in the Fund is subject to the risks discussed in the ''Overview of Fund Risks'' on page 1 under the headings:

Interest Rate Risk
Credit Risk

For further information regarding the Fund's investment strategy and risk factors, see "Other Fund Practices."

PERFORMANCE

The following tables show how the Fund has performed in the past. Past performance is not an indication of future results.

Year-by-Year Total Return for Class S1 Shares (%) ¹

1995	1996	1997	1998	1999	2000	2001	2002	2003	2004
3.76	3.39	3.49	3.40	3.18	4.01	2.36	0.74	0.25	0.32

Best Quarter:	4th Quarter 2000	+ 1.05 %¹
Worst Quarter:	1st Quarter 2004	+ 0.02 %
Year-to-date total return as of 3/31/2005 is +0.21%.

Average Annual Total Return
(for the period ended 12/31/2004) ¹

	Inception Date of Class	1 year	5 year	10 year	Performance Since 11/2/1988
Class S1	6/6/2001	0.32 %	1.53 %	2.48 %	3.20 %
3 Mo. T-Bill ²		1.33 %	2.95 %	4.14 %	4.80 %

To obtain current yield information call 1.800.343.2898.

FEES AND EXPENSES

You pay no shareholder transaction fees to the Fund.

Annual Fund Operating Expenses (expenses that are deducted from Fund assets)

	Class S1
Management Fees	0.41 %
12b-1 Fees	0.60 %
Other Expenses	0.15 %
Total Fund Operating Expenses ³	1.16 %

Example of Fund Expenses

After:	Class S1
1 year	$ 118
3 years	$ 368
5 years	$ 638
10 years	$ 1,409

New Jersey Municipal Money Market Fund

FUND FACTS:

Goals:

· High Current Income Exempt from Federal and New Jersey State Income Taxes

· Preservation of Capital

· Liquidity

· Stability of Principal

Principal Investment:

· Municipal Money Market Securities

Class of Shares Offered in this Prospectus:

· Class S

Investment Advisor:

· Evergreen
Investment
Management
Company, LLC

Dividend Payment Schedule:

· Monthly

INVESTMENT GOAL

INVESTMENT STRATEGY

The following supplements the investment strategies discussed in the ''Overview of Fund Risks'' on page 1.

RISK FACTORS

Your investment in the Fund is subject to the risks discussed in the ''Overview of Fund Risks'' on page 1 under the headings:

Interest Rate Risk
Credit Risk
Concentration Risk
Non-Diversification Risk

For further information regarding the Fund's investment strategy and risk factors, see "Other Fund Practices."

PERFORMANCE

The following tables show how the Fund has performed in the past. Past performance is not an indication of future results.

Year-by-Year Total Return for Class S Shares (%) ¹

1995	1996	1997	1998	1999	2000	2001	2002	2003	2004
				2.54	3.31	1.97	0.62	0.25	0.29

Best Quarter:	2nd Quarter 2000	+ 0.90 %¹
Worst Quarter:	1st Quarter 2004	+ 0.01 %
Year-to-date total return as of 3/31/2005 is +0.22%.

Average Annual Total Return
(for the period ended 12/31/2004)

	Inception Date of Class	1 year	5 year	10 year	Performance Since 10/26/1998
Class S	6/30/2000	0.29 %	1.28 %	N/A	1.52 %
3 Mo. T-Bill ²		1.33 %	2.95 %	N/A	3.29 %

To obtain current yield information call 1.800.343.2898.

FEES AND EXPENSES

You pay no shareholder transaction fees to the Fund.

Annual Fund Operating Expenses (expenses that are deducted from Fund assets) ³

	Class S
Management Fees	0.41 %
12b-1 Fees	0.60 %
Other Expenses	0.17 %
Total Fund Operating Expenses	1.18 %

3. Restated to reflect current fees.

Example of Fund Expenses

After:	Class S
1 year	$ 120
3 years	$ 375
5 years	$ 649
10 years	$ 1,432

New York Municipal Money Market Fund

FUND FACTS:

Goals:

· High Rate of Current Income Exempt from Federal and New York State and New York City Income Taxes

· Preservation of Capital

· Liquidity

Principal Investment:

· Municipal Money Market Securities

Class of Shares Offered in this Prospectus:

· Class S

Investment Advisor:

· Evergreen
Investment
Management
Company, LLC

Dividend Payment Schedule:

· Monthly

INVESTMENT GOAL

INVESTMENT STRATEGY

The following supplements the investment strategies discussed in the ''Overview of Fund Risks'' on page 1.

RISK FACTORS

Your investment in the Fund is subject to the risks discussed in the ''Overview of Fund Risks'' on page 1 under the headings:

Interest Rate Risk
Credit Risk
Concentration Risk
Non-Diversification Risk

For further information regarding the Fund's investment strategy and risk factors, see "Other Fund Practices."

PERFORMANCE

The following tables show how the Fund has performed in the past. Past performance is not an indication of future results.

Year-by-Year Total Return for Class S Shares (%)

1995	1996	1997	1998	1999	2000	2001	2002	2003	2004
							0.52	0.20	0.24

Best Quarter:	4th Quarter 2002	+ 0.16 %
Worst Quarter:	1st Quarter 2004	+ 0.01 %
Year-to-date total return as of 3/31/2005 is +0.20%.

Average Annual Total Return
(for the period ended 12/31/2004)

	Inception Date of Class	1 year	5 year	10 year	Performance Since 9/24/2001
Class S	9/24/2001	0.24 %	N/A	N/A	0.36 %
3 Mo. T-Bill ¹		1.33 %	N/A	N/A	1.51 %

To obtain current yield information call 1.800.343.2898.

FEES AND EXPENSES

You pay no shareholder transaction fees to the Fund.

Annual Fund Operating Expenses (expenses that are deducted from Fund assets)

	Class S
Management Fees	0.40 %
12b-1 Fees	0.60 %
Other Expenses	0.18 %
Total Fund Operating Expenses ²	1.18 %

Example of Fund Expenses

After:	Class S
1 year	$ 120
3 years	$ 375
5 years	$ 649
10 years	$ 1,432

Pennsylvania Municipal Money Market Fund

FUND FACTS:

Goals:

· High Current Income Exempt from Federal and Pennsylvania State Income Taxes

· Preservation of Capital

· Liquidity

Principal Investment:

· Municipal Money Market Securities

Class of Shares Offered in this Prospectus:

· Class S

Investment Advisor:

· Evergreen
Investment
Management
Company, LLC

Dividend Payment Schedule:

· Monthly

INVESTMENT GOAL

INVESTMENT STRATEGY

The following supplements the investment strategies discussed in the ''Overview of Fund Risks'' on page 1.

RISK FACTORS

Your investment in the Fund is subject to the risks discussed in the ''Overview of Fund Risks'' on page 1 under the headings:

Interest Rate Risk
Credit Risk
Concentration Risk
Non-Diversification Risk

For further information regarding the Fund's investment strategy and risk factors, see "Other Fund Practices."

PERFORMANCE

The following tables show how the Fund has performed in the past. Past performance is not an indication of future results.

Year-by-Year Total Return for Class S Shares (%) ¹

1995	1996	1997	1998	1999	2000	2001	2002	2003	2004
3.66	3.07	3.22	3.09	2.96	3.53	1.98	0.70	0.24	0.35

Best Quarter:	2nd Quarter 2000	+ 0.99 %¹
Worst Quarter:	3rd Quarter 2003	+ 0.02 %
Year-to-date total return as of 3/31/2005 is +0.23%.

Average Annual Total Return
(for the period ended 12/31/2004)

	Inception Date of Class	1 year	5 year	10 year	Performance Since 8/15/1991
Class S	6/30/2000	0.35 %	1.35 %	2.27 %	2.39 %
3 Mo. T-Bill ²		1.33 %	2.95 %	4.14 %	4.12 %

To obtain current yield information call 1.800.343.2898.

FEES AND EXPENSES

You pay no shareholder transaction fees to the Fund.

Annual Fund Operating Expenses (expenses that are deducted from Fund assets) ³

	Class S
Management Fees	0.36 %
12b-1 Fees	0.60 %
Other Expenses	0.18 %
Total Fund Operating Expenses	1.14 %

3. Restated to reflect current fees.

Example of Fund Expenses

After:	Class S
1 year	$ 116
3 years	$ 362
5 years	$ 628
10 years	$ 1,386

Treasury Money Market Fund

FUND FACTS:

Goals:

· Stability of Principal

· Current Income

· Liquidity

Principal Investments:

· Short-term U.S. Treasury Obligations

· Repurchase Agreements backed by Short-term U.S. Treasury Obligations

Class of Shares Offered in this Prospectus:

· Class S

Investment Advisor:

· Evergreen
Investment
Management
Company, LLC

Dividend Payment Schedule:

· Monthly

INVESTMENT GOAL

The Fund seeks to maintain stability of principal while earning current income and providing liquidity.

INVESTMENT STRATEGY

The following supplements the investment strategies discussed in the ''Overview of Fund Risks'' on page 1.

The Fund maintains an average dollar-weighted maturity of 60 days or less.

RISK FACTORS

Your investment in the Fund is subject to the risks discussed in the ''Overview of Fund Risks'' on page 1 under the headings:

Interest Rate Risk
Credit Risk

For further information regarding the Fund's investment strategy and risk factors, see "Other Fund Practices."

PERFORMANCE

The following tables show how the Fund has performed in the past. Past performance is not an indication of future results.

Year-by-Year Total Return for Class S Shares (%) ¹

1995	1996	1997	1998	1999	2000	2001	2002	2003	2004
5.38	4.78	4.91	4.83	4.33	5.43	3.04	0.91	0.13	0.35

Best Quarter:	4th Quarter 2000	+ 1.39 %
Worst Quarter:	2nd Quarter 2004	+ 0.01 %
Year-to-date total return as of 3/31/2005 is +0.32%.

Average Annual Total Return
(for the period ended 12/31/2004) ¹

	Inception Date of Class	1 year	5 year	10 year	Performance Since 3/6/1991
Class S	6/30/2000	0.35 %	1.95 %	3.39 %	3.49 %
3 Mo. T-Bill ²		1.33 %	2.95 %	4.14 %	4.19 %

To obtain current yield information call 1.800.343.2898.

FEES AND EXPENSES

You pay no shareholder transaction fees to the Fund.

Annual Fund Operating Expenses (expenses that are deducted from Fund assets) ³

	Class S
Management Fees	0.31 %
12b-1 Fees	0.60 %
Other Expenses	0.12 %
Total Fund Operating Expenses	1.03 %

3. Restated to reflect current fees.

Example of Fund Expenses

After:	Class S
1 year	$ 105
3 years	$ 328
5 years	$ 569
10 years	$ 1,259

U.S. Government Money Market Fund

FUND FACTS:

Goals:

· High Current Income

· Preservation of Capital

· Liquidity

Principal Investment:

· Short-term U.S. Government Securities

· Mortgage- and Asset-Backed Securities

Class of Shares Offered in this Prospectus:

· Class S1

Investment Advisor:

· Evergreen
Investment
Management
Company, LLC

Dividend Payment Schedule:

· Monthly

INVESTMENT GOAL

The Fund seeks to achieve as high a level of current income as is consistent with preserving capital and maintaining liquidity.

INVESTMENT STRATEGY

The following supplements the investment strategies discussed in the ''Overview of Fund Risks'' on page 1.

Under current market conditions, the Fund expects to invest substantially all of its assets in debt obligations issued by U.S. government agencies.

RISK FACTORS

Your investment in the Fund is subject to the risks discussed in the ''Overview of Fund Risks'' on page 1 under the headings:

Interest Rate Risk
Credit Risk

For further information regarding the Fund's investment strategy and risk factors, see "Other Fund Practices."

PERFORMANCE

The following tables show how the Fund has performed in the past. Past performance is not an indication of future results.

The table below shows the percentage gain for the Class S1 shares of the Fund in each calendar year since the Class S1 shares' inception on 6/26/2001. It should give you a general idea of the risks of investing in the Fund. This table includes the effects of Fund expenses.

Year-by-Year Total Return for Class S1 Shares (%)

							2002	2003	2004
							1.05	0.19	0.35

Best Quarter:	1st Quarter 2002	+ 0.31 %
Worst Quarter:	2nd Quarter 2004	+ 0.01 %
Year-to-date total return as of 3/31/2005 is +0.33%.

The next table lists the Fund’s average annual total return for the Class S1 shares over the past year and since inception. This table is intended to provide you with some indication of the risks of investing in the Fund.

Average Annual Total Return
(for the period ended 12/31/2004)

	Inception Date of Class	1 year	5 year	10 year	Performance Since 6/26/2001
Class S1	6/26/2001	0.35 %	N/A	N/A	0.78 %
3 Mo. T-Bill ¹		1.33 %	N/A	N/A	1.70 %

To obtain current yield information call 1.800.343.2898.

FEES AND EXPENSES

You pay no shareholder transaction fees to the Fund.

Annual Fund Operating Expenses (expenses that are deducted from Fund assets) ²

	Class S1
Management Fees	0.35 %
12b-1 Fees	0.60 %
Other Expenses	0.39 %
Total Fund Operating Expenses ³	1.34 %

2. Restated to reflect current fees.

Example of Fund Expenses

After:	Class S1
1 year	$ 136
3 years	$ 425
5 years	$ 734
10 years	$ 1,613

THE FUNDS' INVESTMENT ADVISOR

For the fiscal year ended 1/31/2005, the aggregate advisory fee paid to investment advisor by each Fund was as follows:

Fund	% of the Fund's average daily net assets
California Municipal Money Market Fund	0.44 %
Florida Municipal Money Market Fund	0.39 %
Money Market Fund	0.40 %
Municipal Money Market Fund	0.37 %
New Jersey Municipal Money Market Fund	0.40 %
New York Municipal Money Market Fund	0.37 %
Pennsylvania Municipal Money Market Fund	0.36 %
Treasury Money Market Fund	0.31 %
U.S. Government Money Market Fund	0.32 %

Legal Proceedings

CALCULATING THE SHARE PRICE

HOW TO CHOOSE AN EVERGREEN FUND

When choosing an Evergreen fund, you should:

Most importantly, read the prospectus to see if the Fund is suitable for you.
Consider talking to an investment professional. He or she is qualified to give you investment advice based on your investment goals and financial situation and will be able to answer questions you may have after reading the Fund's prospectus. He or she can also assist you through all phases of opening your account.
Request any additional information you want about the Fund, such as the Statement of Additional Information (SAI), Annual Report or Semi-annual Report by calling 1.800.343.2898. In addition, any of these documents may be downloaded off our website at EvergreenInvestments.com.

HOW TO CHOOSE THE SHARE CLASS THAT BEST SUITS YOU

After choosing a Fund, you select a share class. The Funds offer up to six different share classes, each with its own fee and expense structure. Only Class S shares of California Municipal Money Market Fund, Florida Municipal Money Market Fund, New Jersey Municipal Money Market Fund, New York Municipal Money Market Fund, Pennsylvania Municipal Money Market Fund and Treasury Money Market Fund and Class S1 shares of Money Market Fund, Municipal Money Market Fund and U.S. Government Money Market Fund are offered in this prospectus.

Class S and Class S1

Each Fund offers either Class S or Class S1 shares at NAV without a front-end sales charge or deferred sales charge. However, both Class S and Class S1 shares are subject to 12b-1 fees. Class S and Class S1 shares are typically purchased in connection with “sweep programs" made available by broker-dealers or other financial intermediaries. Such broker-dealers or financial intermediaries may impose account fees or other charges and certain broker-dealers and other financial institutions may impose a fee in connection with purchases of Class S and Class S1 shares of the Funds. A portion of Class S1 shares' 12b-1 fees may be voluntarily waived.

Promotional Incentives on Dealer Commissions

Additional Compensation to Financial Services Firms

HOW TO BUY AND REDEEM SHARES

Class S and Class S1 shares are sold through certain broker-dealers and financial institutions which have selling agreements with EIS. Class S and Class S1 shares are typically purchased in connection with “sweep programs" made available by broker-dealers or other financial intermediaries. Such broker-dealers or financial intermediaries may impose account fees or other charges and certain broker-dealers and other financial institutions may impose a fee in connection with purchases of Class S and Class S1 shares of the Funds. You can also redeem your Class S and Class S1 shares of the Funds at NAV through certain broker-dealers and financial institutions which have selling agreements with EIS on any day the New York Stock Exchange is open pursuant to the Fund’s procedures. Investors should refer to their broker-dealer or financial institution as appropriate for instruction and further information.

OTHER SERVICES

Automatic Reinvestment of Distributions

THE TAX CONSEQUENCES OF INVESTING
IN THE FUNDS

Fund Distributions

A mutual fund passes along to all of its shareholders the net income or profits it receives from its investments. The shareholders of the fund then pay any taxes due, whether they receive these distributions in cash or elect to have them reinvested. California Municipal Money Market Fund, Florida Municipal Money Market Fund, Municipal Money Market Fund, New Jersey Municipal Money Market Fund, New York Municipal Money Market Fund and Pennsylvania Municipal Money Market Fund expect that substantially all of their regular dividends will be exempt from federal income tax other than the alternative minimum tax. Otherwise, the Funds will distribute two types of taxable income to you:

Dividends. To the extent that regular dividends are derived from investment income that is not tax-exempt, or from short-term capital gains, you will have to include them in your federal taxable income. Each Fund pays a monthly dividend from the dividends, interest and other income on the securities in which it invests.
Capital Gains. When a mutual fund sells a security it owns for a profit, the result is a capital gain. The Funds generally distribute capital gains, if any, at least once a year, near the end of the calendar year. Short-term capital gains reflect securities held by the Funds for a year or less and are considered ordinary income just like dividends. Profits on securities held longer than 12 months are considered long-term capital gains when they are distributed to shareholders. Individual shareholders receiving such distributions are taxed at a maximum rate no higher than 15%. It is not anticipated that any significant capital gains will be realized by the Funds.
Alternative Minimum Tax. An investment in California Municipal Money Market Fund, Florida Municipal Money Market Fund, Municipal Money Market Fund, New Jersey Municipal Money Market Fund, New York Municipal Money Market Fund and Pennsylvania Municipal Money Market Fund may result in liability for federal alternative minimum tax (AMT), both for individual and corporate shareholders. For example, while the interest from qualified private activity bonds is generally not subject to federal income tax, many types of private activity bond interest must be included in taxable income for federal AMT purposes.

Dividend and Capital Gain Reinvestment

Profits You Realize When You Redeem Shares

Tax Reporting

MORE INFORMATION ABOUT THE FUNDS' FEES AND EXPENSES

Every mutual fund has fees and expenses that are assessed either directly or indirectly. This section describes each of those fees.

OVERVIEW OF FEES AND EXPENSES

ANNUAL FUND OPERATING EXPENSES (expenses that are deducted from Fund assets)

An investment in an Evergreen mutual fund is subject to the following on-going fees, which reduce the overall return earned by an investor:

Management Fee

The management fee is paid by each Fund to the investment advisor for investment advisory services. These services include day-to-day management of the Fund’s portfolio of investments.

Distribution (Rule 12b-1) Fees

Distribution fees -- also known as Rule 12b-1 fees, referring to the SEC rule that authorizes the imposition of the fees -- are paid by a fund to support the marketing and sale of the Fund’s shares. The Trustees of the Evergreen funds have approved a policy to assess annual 12b-1 fees of up to 1.00% of the average daily net assets of Class S shares and up to 0.60% of the average daily net assets of Class S1 shares. However, currently the 12b-1 fees for Class S shares are limited to 0.60% of the average daily net assets of the class. In addition, all or a portion of the 12b-1 fees for Class S1 shares may be voluntarily waived from time to time. These fees increase the cost of your investment. These fees may pay for marketing and advertising costs. They also may be used to pay commissions and other fees to broker-dealers who provide investment advice or investor services to their clients who have invested in the Funds.

Other Expenses

Total Fund Operating Expenses

PORTFOLIO TRADING COSTS

FINANCIAL HIGHLIGHTS

This section looks in detail at the results for one share in each share class of the Funds included in this prospectus - how much income it earned, how much of this income was passed along as a distribution and how much the return was reduced by expenses. The following tables have been derived from financial information audited by KPMG LLP, the Funds' independent registered public accounting firm. For a more complete picture of the Funds' financial statements, please see each Fund's Annual Report as well as the SAI.

California Municipal Money Market Fund

	Year Ended January 31,
CLASS S	2005	2004	2003	2002 ¹
Net asset value, beginning of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Income from investment operations
Net investment income	0	0	0.01	0

Distributions to shareholders from
Net investment income	0 ²	0 ²	- 0.01	0 ²

Net asset value, end of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Total return	0.30 %	0.19 %	0.68 %	0.29 %
Ratios and supplemental data
Net assets, end of period (thousands)	$ 172,467	$ 25,427	$ 41,997	$ 41,972
Ratios to average net assets
Expenses ³	1.16 %	1.15 %	1.11 %	1.19 %⁴
Net investment income	0.53 %	0.20 %	0.65 %	0.83 %⁴

1. For the period from September 24, 2001 (commencement of class operations), to January 31, 2002.

2. Amount represents less than $0.005 per share.

3. The ratio of expenses to average net assets excludes expense reductions but includes fee waivers and/or expense reimbursements.

4. Annualized

Florida Municipal Money Market Fund

	Year Ended January 31,
CLASS S	2005	2004	2003	2002	2001 ¹
Net asset value, beginning of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Income from investment operations
Net investment income	0	0	0.01	0.02	0.02

Distributions to shareholders from
Net investment income	0 ²	0 ²	- 0.01	- 0.02	- 0.02

Net asset value, end of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Total return	0.32 %	0.20 %	0.59 %	1.73 %	1.87 %
Ratios and supplemental data
Net assets, end of period (thousands)	$ 442,868	$ 259,620	$ 242,800	$ 206,592	$ 163,045
Ratios to average net assets
Expenses ³	1.11 %	1.12 %	1.17 %	1.15 %	1.16 %⁴
Net investment income	0.37 %	0.20 %	0.52 %	1.58 %	3.08 %⁴

1. For the period from June 30, 2000 (commencement of class operations), to January 31, 2001.

2. Amount represents less than $0.005 per share.

3. The ratio of expenses to average net assets excludes expense reductions but includes fee waivers and/or expense reimbursements.

4. Annualized

Money Market Fund

	Year Ended January 31,
CLASS S1	2005	2004	2003	2002 ¹
Net asset value, beginning of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Income from investment operations
Net investment income	0.01	0	0.01	0.01

Distributions to shareholders from
Net investment income	- 0.01	0 ²	- 0.01	- 0.01

Net asset value, end of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Total return	0.52 %	0.20 %	1.18 %	1.38 %
Ratios and supplemental data
Net assets, end of period (millions)	$ 2,294	$ 1,057	$ 1,767	$ 1,300
Ratios to average net assets
Expenses ³	1.09 %	1.05 %	0.85 %	0.86 %⁴
Net investment income	0.75 %	0.21 %	1.16 %	1.72 %⁴

1. For the period from June 26, 2001 (commencement of class operations), to January 31, 2002.

2. Amount represents less than $0.005 per share.

3. The ratio of expenses to average net assets excludes expense reductions but includes fee waivers and/or expense reimbursements.

4. Annualized

Municipal Money Market Fund

	Year Ended January 31,
CLASS S1	2005	2004	2003	2002 ¹
Net asset value, beginning of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Income from investment operations
Net investment income	0	0	0.01	0.01

Distributions to shareholders from
Net investment income	0 ²	0 ²	- 0.01	- 0.01

Net asset value, end of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Total return	0.37 %	0.22 %	0.72 %	0.77 %
Ratios and supplemental data
Net assets, end of period (millions)	$ 1,344	$ 274	$ 369	$ 257
Ratios to average net assets
Expenses ³	1.10 %	1.12 %	1.09 %	1.10 %⁴
Net investment income	0.57 %	0.22 %	0.67 %	0.96 %⁴

1. For the period from June 26, 2001 (commencement of class operations), to January 31, 2002.

2. Amount represents less than $0.005 per share.

3. The ratio of expenses to average net assets excludes expense reductions but includes fee waivers and/or expense reimbursements.

4. Annualized

New Jersey Municipal Money Market Fund

	Year Ended January 31,
CLASS S	2005	2004	2003	2002	2001 ¹
Net asset value, beginning of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Income from investment operations
Net investment income	0	0	0.01	0.02	0.02
Distributions to shareholders from
Net investment income	0 ²	0 ²	- 0.01	- 0.02	- 0.02
Net asset value, end of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Total return	0.35 %	0.24 %	0.60 %	1.81 %	1.84 %
Ratios and supplemental data
Net assets, end of period (millions)	$ 171	$ 66	$ 108	$ 136	$ 98
Ratios to average net assets
Expenses ³	1.16 %	1.16 %	1.16 %	1.15 %	1.14 %⁴
Net investment income	0.48 %	0.19 %	0.51 %	1.71 %	3.07 %⁴

1. For the period from June 30, 2000 (commencement of class operations), to January 31, 2001.

2. Amount represents less than $0.005 per share.

3. The ratio of expenses to average net assets excludes expense reductions but includes fee waivers and/or expense reimbursements.

4. Annualized

New York Municipal Money Market Fund

	Year Ended January 31,
CLASS S	2005	2004	2003	2002 ¹
Net asset value, beginning of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Income from investment operations
Net investment income	0	0	0.01	0

Distributions to shareholders from
Net investment income	0 ²	0 ²	- 0.01	0 ²

Net asset value, end of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Total return	0.30 %	0.19 %	0.52 %	0.22 %
Ratios and supplemental data
Net assets, end of period (thousands)	$ 289,872	$ 25,407	$ 35,817	$ 24,092
Ratios to average net assets
Expenses ³	1.11 %	1.18 %	1.18 %	1.18 %⁴
Net investment income	0.54 %	0.13 %	0.49 %	0.54 %⁴

1. For the period from September 24, 2001 (commencement of class operations), to January 31, 2002.

2. Amount represents less than $0.005 per share.

3. The ratio of expenses to average net assets excludes expense reductions but includes fee waivers and/or expense reimbursements.

4. Annualized

Pennsylvania Municipal Money Market Fund

	Year Ended January 31,
CLASS S	2005	2004	2003	2002	2001 ¹
Net asset value, beginning of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Income from investment operations
Net investment income	0	0	0.01	0.02	0.02

Distributions to shareholders from
Net investment income	0 ²	0 ²	- 0.01	- 0.02	- 0.02

Net asset value, end of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Total return	0.41 %	0.23 %	0.69 %	1.82 %	1.89 %
Ratios and supplemental data
Net assets, end of period (millions)	$ 62	$ 71	$ 137	$ 155	$ 140
Ratios to average net assets
Expenses ³	1.11 %	1.11 %	1.07 %	1.08 %	1.09 %⁴
Net investment income	0.41 %	0.23 %	0.62 %	1.79 %	3.17 %⁴

1. For the period from June 30, 2000 (commencement of class operations), to January 31, 2001.

2. Amount represents less than $0.005 per share.

3. The ratio of expenses to average net assets excludes expense reductions but includes fee waivers and/or expense reimbursements.

4. Annualized

Treasury Money Market Fund

	Year Ended January 31,
CLASS S	2005	2004	2003	2002	2001 ¹
Net asset value, beginning of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Income from investment operations
Net investment income	0	0	0.01	0.03	0.03

Distributions to shareholders from
Net investment income	0 ²	0 ²	- 0.01	- 0.03	- 0.03

Net asset value, end of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Total return	0.44 %	0.11 %	0.84 %	2.70 %	3.24 %
Ratios and supplemental data
Net assets, end of period (millions)	$ 761	$ 856	$ 1,484	$ 1,826	$ 2,135
Ratios to average net assets
Expenses ³	1.01 %	1.02 %	1.03 %	1.00 %	1.04 %⁴
Net investment income	0.43 %	0.12 %	0.85 %	2.71 %	5.50 %⁴

1. For the period from June 30, 2000 (commencement of class operations), to January 31, 2001.

2. Amount represents less than $ 0.005 per share.

3. The ratio of expenses to average net assets excludes expense reductions but includes fee waivers and/or expense reimbursements.

4. Annualized

U.S. Government Money Market Fund

	Year Ended January 31,
CLASS S1	2005	2004	2003	2002 ¹
Net asset value, beginning of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Income from investment operations
Net investment income	0	0	0.01	0.01

Distributions to shareholders from
Net investment income	0 ²	0 ²	- 0.01	- 0.01

Net asset value, end of period	$ 1.00	$ 1.00	$ 1.00	$ 1.00
Total return	0.45 %	0.15 %	0.99 %	1.24 %
Ratios and supplemental data
Net assets, end of period (thousands)	$ 351,433	$ 266,596	$ 431,731	$ 390,392
Ratios to average net assets
Expenses ³	1.10 %	1.04 %	0.90 %	0.90 %⁴
Net investment income	0.61 %	0.16 %	0.97 %	1.56 %⁴

1. For the period from June 26, 2001 (commencement of class operations), to January 31, 2002.

2. Amount represents less than $0.005 per share.

3. The ratio of expenses to average net assets excludes expense reductions but includes fee waivers and/or expense reimbursements.

4. Annualized

OTHER FUND PRACTICES

Please consult the SAI for more information regarding these and other investment practices used by the Funds, including related risks.

FUND GOVERNANCE

See the SAI for additional information about the Board of Trustees, including Trustees’ compensation, Evergreen fund ownership by the Trustees, committee memberships and responsibilities.

The following individuals currently serve as Trustees of the Evergreen funds:

Independent Trustees:

Interested Trustee:

Mr. Wagoner is an “interested person” of the Evergreen funds because of his ownership of shares of Wachovia Corporation, the parent to EIMC, the Evergreen funds’ investment advisor.

FUND OPERATING POLICIES AND PROCEDURES

Short-Term Trading

The Evergreen funds attempt to enforce the foregoing trading restrictions by monitoring purchases, sales and exchanges on a daily basis. However, there are significant limitations on the Funds' ability to detect and prevent trading by policy owners and contract holders that would violate these restrictions. For example, the Funds will not generally have access to trading information regarding policy owners and contract holders and as a result will not typically be able to identify accounts through which violative trading is occurring, or even to determine whether such trading is actually occurring. In the case of omnibus accounts, the Funds do not have access to information regarding trading activity by individual investors, and therefore are unable to monitor for excessive short-term trading or violations of the Funds' trading restrictions. A majority of the Funds' shares may be held in omnibus accounts. For these and other reasons, it is possible that excessive short-term trading or trading in violation of the Funds' trading restrictions may occur despite the Funds' efforts to prevent them. See the prospectus or other documents for your insurance product for information about any steps your participating issuer takes to limit excessive trading.

Fund Pricing

Portfolio Holdings

Transactions with Affiliates

Proxy Voting

Privacy

For More Information About the Evergreen Money Market Funds, Ask for:

Each Fund's most recent Annual or Semi-annual Report, which contains a complete financial accounting for each Fund and a complete list of each Fund's portfolio holdings as of a specific date, as well as commentary from each Fund’s portfolio managers. These reports discuss the market conditions and investment strategies that significantly affected the Funds' performance during the most recent fiscal year or period.
The Statement of Additional Information (SAI), which contains more detailed information about the Funds and their policies and procedures. The SAI has been filed with the Securities and Exchange Commission (SEC) and its contents are legally considered to be part of this prospectus.

· Evergreen mutual funds are distributed by Evergreen Investment Services, Inc.,

· 200 Berkeley Street, Boston, MA 02116-5034. 558704 RV5 (6/05)

· Evergreen Investments

· 200 Berkeley Street

· Boston, MA 02116-5034

SEC File No.: 811-08555

EVERGREEN MONEY MARKET TRUST

PART B

STATEMENT OF ADDITIONAL INFORMATION (SAI)

EVERGREEN MONEY MARKET TRUST

200 Berkeley Street

Boston, Massachusetts 02116

1.800.343.2898

STATEMENT OF ADDITIONAL INFORMATION

June 1, 2005

Evergreen California Municipal Money Market Fund (“California Municipal Money Market Fund”)

Evergreen Florida Municipal Money Market Fund (“Florida Municipal Money Market Fund”)

Evergreen Money Market Fund (“Money Market Fund”)

Evergreen Municipal Money Market Fund (“Municipal Money Market Fund”)

Evergreen New Jersey Municipal Money Market Fund (“New Jersey Municipal Money Market Fund”)

Evergreen New York Municipal Money Market Fund (“New York Municipal Money Market Fund”)

Evergreen Pennsylvania Municipal Money Market Fund (“Pennsylvania Municipal Money Market Fund”)

Evergreen Treasury Money Market Fund (“Treasury Money Market Fund”)

Evergreen U.S. Government Money Market Fund (“U.S. Government Money Market Fund”)

(Each a “Fund”; together, the “Funds”)

Each Fund is a series of an open-end management investment company known as

Evergreen Money Market Trust (the “Trust”)

This Statement of Additional Information (SAI) pertains to all classes of shares of the Funds listed above. It is not a prospectus but should be read in conjunction with the prospectus(es) for the Fund in which you are making or contemplating an investment. The Funds are offered through four prospectuses: one prospectus dated June 1, 2005, as amended from time to time, offering Class A shares of each Fund, Class I shares of each Fund except U.S. Government Money Market Fund, and Class B and Class C shares of Money Market Fund only; one prospectus offering Class S shares of California Municipal Money Market Fund, Florida Municipal Money Market Fund, Money Market Fund, Municipal Money Market Fund, New Jersey Municipal Money Market Fund, New York Municipal Money Market Fund, Pennsylvania Municipal Money Market Fund and Treasury Money Market Fund; one prospectus offering Class A shares of California Municipal Money Market Fund, Money Market Fund, Municipal Money Market Fund, New York Municipal Money Market Fund and U.S. Government Money Market Fund; and one prospectus offering Class S1 shares of Money Market Fund, Municipal Money Market Fund and U.S. Government Money Market Fund and Class S shares of California Municipal Money Market Fund, Florida Municipal Money Market Fund, New Jersey Municipal Money Market Fund, New York Municipal Money Market Fund, Pennsylvania Municipal Money Market Fund and Treasury Money Market Fund. You may obtain a prospectus without charge by calling 1.800.343.2898 or downloading it off our website at EvergreenInvestments.com. The information in Part 1 of this SAI is specific information about the Funds described in the prospectuses. The information in Part 2 of this SAI contains more general information that may or may not apply to the Fund or class of shares in which you are interested.

Certain information may be incorporated into this document by reference to each Fund’s Annual Report dated January 31, 2005. You may obtain a copy of the Annual Report without charge by calling 1.800.343.2898 or downloading it off our website at EvergreenInvestments.com.

TABLE OF CONTENTS

PART 1

TRUST HISTORY............................................................................................................................. 1-1

INVESTMENT POLICIES.................................................................................................................. 1-1

OTHER SECURITIES AND PRACTICES............................................................................................. 1-3

PRINCIPAL HOLDERS OF FUND SHARES........................................................................................ 1-4

EXPENSES................................................................................................................................... 1-10

SERVICE PROVIDERS................................................................................................................... 1-16

FINANCIAL STATEMENTS.............................................................................................................. 1-18

ADDITIONAL INFORMATION CONCERNING CALIFORNIA................................................................. 1-19

ADDITIONAL INFORMATION CONCERNING FLORIDA...................................................................... 1-31

ADDITIONAL INFORMATION CONCERNING NEW JERSEY.............................................................. 1-39

ADDITIONAL INFORMATION CONCERNING NEW YORK.................................................................. 1-42

ADDITIONAL INFORMATION CONCERNING PENNSYLVANIA........................................................... 1-52

PART 2

ADDITIONAL INFORMATION ON SECURITIES AND INVESTMENT PRACTICES................................. 2-1

PURCHASE AND REDEMPTION OF SHARES................................................................................ 2-18

SALES CHARGE WAIVERS AND REDUCTIONS............................................................................. 2-22

PRICING OF SHARES.................................................................................................................... 2-25

PRINCIPAL UNDERWRITER........................................................................................................... 2-28

DISTRIBUTION EXPENSES UNDER RULE 12b-1.............................................................................. 2-29

TAX INFORMATION........................................................................................................................ 2-34

BROKERAGE................................................................................................................................ 2-37

ORGANIZATION............................................................................................................................. 2-38

INVESTMENT ADVISORY AGREEMENT......................................................................................... 2-39

MANAGEMENT OF THE TRUST...................................................................................................... 2-41

POLICY FOR DISSEMINATION OF PORTFOLIO HOLDINGS............................................................. 2-46

CORPORATE AND MUNICIPAL BOND RATINGS............................................................................. 2-46

ADDITIONAL INFORMATION........................................................................................................... 2-55

PROXY VOTING POLICY AND PROCEDURES...................................................................... Appendix A

PART 1

TRUST HISTORY

The Trust is an open-end management investment company, which was organized as a Delaware statutory trust on September 18, 1997. A copy of the Agreement and Declaration of Trust, as amended, is on file as an exhibit to the Trust’s Registration Statement, of which this SAI is a part.

INVESTMENT POLICIES

FUNDAMENTAL INVESTMENT RESTRICTIONS

Each Fund has adopted the fundamental investment restrictions set forth below which may not be changed without the vote of a majority of the Fund's outstanding shares, as defined in the Investment Company Act of 1940 (the “1940 Act”). Where necessary, an explanation beneath a fundamental policy describes the Fund’s practices with respect to that policy, as allowed by current law. If the law governing a policy changes, the Funds’ practices may change accordingly without a shareholder vote. Unless otherwise stated, all references to the assets of the Fund are in terms of current market value.

1. Diversification (Money Market Fund, Municipal Money Market Fund, Treasury Money Market Fund and U.S. Government Money Market Fund)

Money Market Fund, Municipal Money Market Fund, Treasury Money Market Fund and U.S. Government Money Market Fund may not make any investment that is inconsistent with each Fund’s classification as a diversified investment company under the 1940 Act.

Further Explanation of Diversification Policy:

To remain classified as a diversified investment company under the 1940 Act, each Fund must conform with the following: With respect to 75% of its total assets, a diversified investment company may not invest more than 5% of its total assets, determined at market or other fair value at the time of purchase, in the securities of any one issuer, or invest in more than 10% of the outstanding voting securities of any one issuer, determined at the time of purchase. These limitations do not apply to (1) a Fund’s assets represented by cash or cash equivalents, (2) investments in securities issued or guaranteed by the United States (“U.S.”) government or its agencies or instrumentalities, and (3) shares of other investment companies.

1a. Non-Diversification (California Municipal Money Market Fund, Florida Municipal Money Market Fund, New Jersey Municipal Money Market Fund, New York Municipal Money Market Fund and Pennsylvania Municipal Money Market Fund)

A non-diversified management investment company, in order to maintain its tax treatment as a registered investment company pursuant to the Internal Revenue Code of 1986, as amended, may have no more than 25% of its total assets invested in the securities (other than U.S. government securities or the shares of other regulated investment companies) of any one issuer and must invest 50% of its total assets under the 5% of its assets and 10% of outstanding voting securities test applicable to diversified funds.

2. Concentration

Each Fund may not concentrate its investments in the securities of issuers primarily engaged in any particular industry (other than securities that are issued or guaranteed by the U.S. government or its agencies or instrumentalities or, in the case of Money Market Fund, domestic bank money instruments).

Further Explanation of Concentration Policy:

Each Fund may not invest more than 25% of its total assets, taken at market value, in the securities of issuers primarily engaged in any particular industry (other than securities issued or guaranteed by the U.S. government or its agencies or instrumentalities).

3. Issuing Senior Securities

Except as permitted under the 1940 Act, each Fund may not issue senior securities.

4. Borrowing

Each Fund may not borrow money, except to the extent permitted by applicable law.

Further Explanation of Borrowing Policy:

Each Fund may borrow from banks and enter into reverse repurchase agreements in an amount up to 33 1/3% of its total assets, taken at market value. Each Fund may also borrow up to an additional 5% of its total assets from banks or others. A Fund may borrow only as a temporary measure for extraordinary or emergency purposes such as the redemption of Fund shares. A Fund may purchase additional securities so long as outstanding borrowings do not exceed 5% of its total assets. Each Fund may obtain such short‑term credit as may be necessary for the clearance of purchases and sales of portfolio securities. Each Fund may purchase securities on margin and engage in short sales to the extent permitted by applicable law.

5. Underwriting

Each Fund may not underwrite securities of other issuers, except insofar as a Fund may be deemed to be an underwriter in connection with the disposition of its portfolio securities.

6. Real Estate

Each Fund may not purchase or sell real estate, except that, to the extent permitted by applicable law, a Fund may invest in (a) securities that are directly or indirectly secured by real estate, or (b) securities issued by issuers that invest in real estate.

7. Commodities

Each Fund may not purchase or sell commodities or contracts on commodities except to the extent that a Fund may engage in financial futures contracts and related options and currency contracts and related options and may otherwise do so in accordance with applicable law, and without registering as a commodity pool operator under the Commodity Exchange Act.

8. Lending

Each Fund may not make loans to other persons, except that a Fund may lend its portfolio securities and cash in accordance with applicable law. The acquisition of investment securities or other investment instruments shall not be deemed to be the making of a loan.

Further Explanation of Lending Policy:

To generate income and offset expenses, a Fund may lend portfolio securities to broker‑dealers and other financial institutions in an amount up to 33 1/3% of its total assets, taken at market value. While securities are on loan, the borrower will pay the Fund any income accruing on the security. The Fund may invest any cash collateral it receives in additional portfolio securities, such as U.S. Treasury notes, certificates of deposit, other high‑grade, short‑term obligations or interest bearing cash equivalents. Increases or decreases in the market value of a security lent will affect the Fund and its shareholders.

When a Fund lends its securities, it will require the borrower to give the Fund collateral in cash or U.S. government securities. The Fund will require collateral in an amount equal to at least 100% of the current market value of the securities lent, including accrued interest. The Fund has the right to call a loan and obtain the securities lent any time on notice of not more than five business days. The Fund may pay fees in connection with such loans.

Subject to receiving shareholder approval, the Funds in the Evergreen Select Equity Trust, Evergreen Select Fixed Income Trust, Evergreen Equity Trust and Evergreen Fixed Income Trust will be able to lend cash to other Evergreen funds, including the Funds of the Trust in accordance with Evergreen’s Interfund Lending Policy and with the exemptive order issued by the Securities and Exchange Commission on November 20, 2001 (Rel. No. 812-11592). Evergreen’s Interfund Lending Program was implemented after July 23, 2002.

9. Investments in Federally Tax-Exempt Securities

Each Fund (other than Money Market Fund, Treasury Money Market Fund and U.S. Government Money Market Fund) will, during periods of normal market conditions, invest its assets in accordance with applicable guidelines issued by the SEC or its staff concerning investment in tax-exempt securities for funds with the words tax-exempt, tax free or municipal in their names.

OTHER SECURITIES AND PRACTICES

For information regarding securities the Funds may purchase and investment practices the Funds may use, see the following sections in Part 2 of this SAI under “Additional Information on Securities and Investment Practices.” Information provided in the sections listed below expands upon and supplements information provided in the Funds’ prospectuses. The list below applies to all Funds unless otherwise noted.

Money Market Instruments

U.S. Government Agency Securities

When-Issued, Delayed-Delivery and Forward Commitment Transactions

Repurchase Agreements

Reverse Repurchase Agreements

Securities Lending

Options and Futures Strategies

Foreign Securities (applicable to Money Market Fund only)

Premium Securities

Illiquid and Restricted Securities

Investment in Other Investment Companies

Municipal Securities (not applicable to Treasury Money Market Fund and U.S. Government Money Market Fund)

U.S. Virgin Islands, Guam and Puerto Rico (not applicable to Money Market Fund, Treasury Money Market Fund and U.S. Government Money Market Fund)

Tender Option Bonds (not applicable to Money Market Fund, Treasury Money Market Fund and U.S. Government Money Market Fund)

Master Demand Notes

Obligations of Foreign Branches of United States Banks (applicable to Money Market Fund only)

Obligations of United States Branches of Foreign Banks (applicable to Money Market Fund only)

Zero Coupon "Stripped" Bonds

Variable and Floating Rate Instruments (not applicable to Treasury Money Market Fund)

Stand-by Commitments

PRINCIPAL HOLDERS OF FUND SHARES

As of April 30, 2005, the officers and Trustees of the Trust owned as a group less than 1% of the outstanding shares of any class of each Fund.

Set forth below is information with respect to each person who, to each Fund’s knowledge, owned beneficially or of record 5% or more of the outstanding shares of any class of a Fund as of April 30, 2005.

California Municipal Money Market Fund

Class A

First Clearing LLC C/F

Attn: Money Market Dept.

10700 N Park Dr.

Glen Allen, VA 23060-9243

99.86%

California Municipal Money Market Fund

Class I

Evergreen California Municipal

Evergreen California Municipal Fund

200 Berkeley St.

Boston, MA 02116-5022

45.31%

Wachovia Bank

Trust Accounts

CMG-1151-2

401 S Tryon St. 3^rd Fl.

Charlotte, NC 28202-1934

20.70%

Hanan Kupferman

Hagit Kupferman JT TEN

22054 E Birdseye Dr.

Diamond Bar CA 91765-3901

15.16%

First Clearing Corporation

Patricia A. Diaz

44030 Goldenrod Circle

La Quinta, CA 92253-4819

9.51%

Donald A. Linden TTEE of

The Linden TR 8/13/85

865 Bette Ave.

Cupertino, CA 95014-4548

6.05%

California Municipal Money Market Fund

Class S

First Clearing Corp PCG-CAP

Sweep Accounts

Attn: RIG Compliance

401 S Tryon St. NC 1164

Charlotte, NC 28202-1934

100.00%

Florida Municipal Money Market Fund

Class A

First Union Brokerage Services

Monehy Market Omnibus Account

301 South College Street

Charlotte, NC 28202-6000

58.49%

Wachovia Bank

Trust Accounts

401 S Tryon St. 3^rd Floor

Charlotte, NC 28202-1934

25.86%

Florida Municipal Money Market Fund

Class I

Wachovia Bank

Trust Accounts

301 S Tryon St 11^th Flr CMG-1151

Charlotte, NC 28202

97.71%

Florida Municipal Money Market Fund

Class S

First Clearing Corp-ISG RIG

Sweep Accounts

Attn: RIG Compliance

401 S Tryon St. NC 1164

Charlotte, NC 28202-1934

84.62%

First Clearing Corp PCG-CAP

Sweep Accounts

Attn: RIG Compliance

401 S Tryon St. NC 1164

Charlotte, NC 28202-1934

15.38%

Money Market Fund

Class A

First Union Brokerage Services

Money Market Omnibus Account

301 S College St.

Charlotte, NC 28202-6000

67.11%

First Union National BK – NC

IRA Department

Attn: RIG Compliance

401 S Tryon St NC 1164

Charlotte, NC 28202-1934

12.72%

BISYS Fund Services Inc.

FBO First Union Sweep Customers

3435 Stelzer Rd.

Columbus, OH 43219-6004

12.72%

Money Market Fund

Class B

None

Money Market Fund

Class C

None

Money Market Fund

Class I

Wachovia Bank

Trust Account LS – 15

1525 West WT Harris Blvd.

Charlotte, NC 28288-0001

79.92%

Byrd & Co.

C/O First Union National Bank

Sweep Funds Processing PA 4903

123 S Broad St.

Philadelphia, PA 19109-1029

6.24%

Pitcairn Trust Company

One Pitcairn Place

Jenkintown, PA 19046-3531

5.65%

Money Market Fund

Class S

First Clearing Corp-ISG RIG

Sweep Accounts

Attn: RIG Compliance

401 S Tryon St NC1164

Charlotte, NC 28202-1934

97.64%

Money Market Fund

Class S1

First Clearing Corp PCG-CAP

Sweep Accounts

Attn: RIG Compliance

401 S Tryon St. NC1164

Charlotte, NC 28202-1934

100.00%

Municipal Money Market Fund

Class A

First Union Brokerage Services

Money Market Omnibus Account

301 S College St.

Charlotte, NC 28202-6000

86.53%

BISYS Fund Services Inc.

FBO First Union Sweep Customers

3435 Stelzer Road

Columbus, OH 43219-6004

8.41%

Municipal Money Market Fund

Class I

Wachovia Bank

Trust Accounts

1525 West WT Harris Blvd.

Charlotte, NC 28288-0001

54.04%

Pitcairn Trust Company

One Pitcairn Place

Jenkintown, PA 19046-3531

9.20%

Municipal Money Market Fund

Class S

First Clearing Corp-ISG RIG

Cap Sweep Accounts

Attn: RIG Compliance

401 S Tryon St. NC 1164

Charlotte, NC 28202-1934

95.87%

Municipal Money Market Fund

Class S1

First Clearing Corp PCG-CAP

Sweep Accounts

Attn: RIG Compliance

401 S Tryon St. NC 164

Charlotte, NC 28202-1934

100.00%

New Jersey Municipal Money Market Fund

Class A

First Union Brokerage Services

Money Market Omnibus Account

301 South College Street

Charlotte, NC 28202-6000

42.17%

Wachovia Bank

Trust Accounts

CMG-1151-2

401 S Tryon St. 3^rd Fl.

Charlotte, NC 28202-1934

26.95%

First Clearing Corporation

Bello Family Partnership PA

240 Cedar Knolls Road Suite 10

Cedar Knolls NJ, 07927-1621

5.18%

New Jersey Municipal Money Market Fund

Class I

Wachovia Bank

Cash Acct.

Trust Accounts

1525 West WT Harris Blvd.

Charlotte, NC 28288-0001

40.84%

Edmund Brenman POA

Sally Brenman

119 Wild Dunes Way

Jackson, NJ 08527-4057

30.14%

First Clearing Corporation

Franklin B. Becker

5 Country Place

Lebanon, NJ 08833-3100

8.29%

Joan F. Goldberg

6 Nicklaus Ct.

Florham Park, NJ 07932-2722

5.96%

First Clearing Corporation

Dennis J O’Leary

Account 2

71 Colfax Road

Skillman, NJ 08558-2310

5.88%

Laetitia M Munro

49 Hilltop Rd.

Newfoundland NJ 07435-1502

5.33%

New Jersey Municipal Money Market Fund

Class S

First Clearing Corp PCG-CAP

Sweep Accounts

Attn: RIG Compliance

401 S Tryon St NC 1164

Charlotte, NC 28202-1934

61.91%

First Clearing Corp-ISG RIG

Sweep Accounts

Attn: RIG Compliance

401 S Tryon St. NC 1164

Charlotte, NC 28202-1935

38.09%

New York Municipal Money Market Fund

Class A

First Union Brokerage Services

Money Market Omnibus Account

301 South College Street

Charlotte, NC 28202-6000

98.45%

New York Municipal Money Market Fund

Class I

Evergreen New York Municipal Trust

Evergreen New York Municipal Fund

200 Berkeley Street

Boston, MA 02116-5022

63.66%

Wachovia Bank

Trust Accounts CMG-1151-2

401 S Tryon St. 3^rd Floor

Charlotte, NC 28202-1934

16.84%

William Petersen &

Eileen Petersen TTEES

Eileen Petersen Revoc Trust

U/A DTD 3/2/98

1 NOB Hill Ct.

Setauket, NY 11733-1339

13.21%

New York Municipal Money Market Fund

Class S

First Clearing Corp PCG-CAP

Sweep Accounts

Attn: RIG Compliance

401 S Tryon St. NC 1164

Charlotte, NC 28202-1934

96.74%

Pennsylvania Municipal Money Market Fund

Class A

First Union Brokerage Services

Money Market Omnibus Account

301 South College Street

Charlotte, NC 28202-6000

80.58%

Pennsylvania Municipal Money Market Fund

Class I

Wachovia Bank

Trust Accounts

1525 West WT Harris Blvd.

Charlotte, NC 28288-0001

77.68%

First Union Brokerage Services

Money Market Omnibus Account

301 S College St.

Charlotte, NC 28202-6000

12.50%

Pennsylvania Municipal Money Market Fund

Class S

First Clearing Corp-ISG RIG

Sweep Accounts

Attn: RIG Compliance

401 S Tryon St. NC 1164

Charlotte, NC 28202-1934

94.50%

First Clearing Corp PCG-CAP

Sweep Accounts

Attn: RIG Compliance

401 S Tryon St. NC 1164

Charlotte, NC 28202-1934

5.50%

Treasury Money Market Fund

Class A

Wachovia Bank

Trust Accounts

11^th Floor

301 S Tryon Street

Charlotte, NC 28202

45.77%

BISYS Fund Services Inc.

FBO First Union Sweep Customers

3435 Stelzer Road

Columbus, OH 43219-6004

33.30%

First Union Brokerage Services

Money Market Omnibus Account

301 S College St.

Charlotte, NC 28202-6000

6.39%

Treasury Money Market Fund

Class I

Trust-AccoWachovia Bank

Trust Accounts

301 S Tryon St.

11^th Fl.

Charlotte, NC 28202

34.76%

BYRD & Co.

C/O First Union National Bank

Sweep Funds Processing, PA 4903

123 S Broad St.

Philadelphia, PA 19109-1029

26.12%

Lynspen & Co.

Attn: Mutual Funds

PO Box 830804

Birmingham, AL 35283-0804

16.84%

BYRD & Co.

123 S Broad St.

MBO Bldg MC PA 4903

Philadelphia, PA 19109-1029

14.63%

Treasury Money Market Fund

Class S

First Clearing Corp-ISG RIG

Sweep Accounts

Attn: RIG Compliance

401 S Tryon St.

Charlotte, NC 28202-1934

82.98%

First Clearing Corp. PCG-CAP

Sweep Accounts

Attn: RIG Compliance

401 S Tryon St.

Charlotte, NC 28202-1934

17.02%

U.S. Government Money Market Fund

Class A

First Clearing LLC C/F

Attn: Money Market Dept.

10700 N Park Dr.

Glen Allen, VA 23060-9243

99.57%

U.S. Government Money Market Fund

Class S1

First Clearing Corp PCG-CAP

Sweep Accounts

Attn: RIG Compliance

401 S Tryon St. NC1164

Charlotte, NC 28202-1934

100.00%

EXPENSES

Advisory Fees

Evergreen Investment Management Company, LLC (EIMC), a wholly owned subsidiary of Wachovia Corporation (Wachovia), is the investment advisor to the Funds. Wachovia is located at 301 South College Street, Charlotte, North Carolina 28288-0013. For more information, see “Investment Advisory Agreement” in Part 2 of this SAI.

EIMC is entitled to receive from California Municipal Money Market an annual fee based on the Fund’s average daily net assets as follows:

Average Daily Net Assets	Fee
First $500 million	0.45%
Next $500 million	0.40%
Next $500 million	0.35%
Over $1.5 billion	0.30%

EIMC is entitled to receive from Florida Municipal Money Market and U.S. Government Money Market an annual fee based on each Fund’s average daily net assets as follows:

Average Daily Net Assets	Fee
First $500 million	0.40%
Next $500 million	0.35%
Over $1 billion	0.30%

EIMC is entitled to receive from Money Market Fund and Municipal Money Market Fund an annual fee based on each Fund’s average daily net assets as follows:

Average Daily Net Assets	Fee
First $1 billion	0.44%
Over $1 billion	0.39%

EIMC is entitled to receive from New Jersey Municipal Money Market an annual fee based on the Fund’s average daily net assets as follows:

Average Daily Net Assets	Fee
First 1 billion	0.41%
Next $500 million	0.35%
Over $1.5 billion	0.30%

EIMC is entitled to receive from New York Municipal Money Market an annual fee based on the Fund’s average daily net assets as follows:

Average Daily Net Assets	Fee
First 1 billion	0.40%
Next $500 million	0.35%
Over $1.5 billion	0.30%

EIMC is entitled to receive from Pennsylvania Municipal Money Market Fund an annual fee based on the average daily net assets of the Fund, as follows:

Average Daily Net Assets	Fee
First $500 million	0.36%
Next $500 million	0.32%
Next $500 million	0.28%
Over $1.5 billion	0.24%

EIMC is entitled to receive from Treasury Money Market Fund an annual fee of 0.31% of the average daily net assets of the Fund.

Advisory Fees Paid

Below are the advisory fees paid by each Fund for the last three fiscal years or periods.

Fund/Fiscal Year or Period Ended	Advisory Fees Paid	Advisory Fees Waived
January 31, 2005
California Municipal Money Market Fund	$735,574	$17,037
Florida Municipal Money Market Fund	$1,233,553	$54,074
Money Market Fund	$38,489,664	$430,986
Municipal Money Market Fund	$9,066,459	$925,406
New Jersey Municipal Money Market Fund	$580,959	$9,998
New York Municipal Money Market Fund	$865,390	$64,053
Pennsylvania Municipal Money Market Fund	$548,377	$0
Treasury Money Market Fund	$8,702,253	$0
U.S. Government Money Market Fund	$4,547,743	$717,834
January 31, 2004
California Municipal Money Market Fund	$829,190	$18,890
Florida Municipal Money Market Fund	$1,060,773	$0
Money Market Fund	$74,704,349	$0
Municipal Money Market Fund	$11,357,063	$0
New Jersey Municipal Money Market Fund	$652,562	$0
New York Municipal Money Market Fund	$568,448	$1,376
Pennsylvania Municipal Money Market Fund	$765,358	$0
Treasury Money Market Fund	$10,943,409	$0
U.S. Government Money Market Fund	$15,433,204	$0
January 31, 2003
California Municipal Money Market Fund	$674,459	$143,088
Florida Municipal Money Market Fund	$969,962	$0
Money Market Fund	$91,438,646	$0
Municipal Money Market Fund	$11,116,365	$0
New Jersey Municipal Money Market Fund	$716,324	$0
New York Municipal Money Market Fund	$430,076	$58,761
Pennsylvania Municipal Money Market Fund	$908,289	$0
Treasury Money Market Fund	$11,405,301	$0
U.S. Government Money Market Fund	$17,306,253	$0

12b-1 Fees

Below are the 12b-1 fees paid by each Fund for the fiscal year ended January 31, 2005. For more information, see “Distribution Expenses Under Rule 12b-1” in Part 2 of this SAI. Class I shares do not pay 12b-1 fees.

Fund	Class A
Fund	Service Fees Paid	Fee Reimbursement
California Municipal Money Market Fund	$226,535	$0
Florida Municipal Money Market Fund	$69,633	$0
Money Market Fund	$11,222,625	$508,270
Municipal Money Market Fund	$2,497,174	$0
New Jersey Municipal Money Market Fund	$74,430	$0
New York Municipal Money Market Fund	$248,701	$0
Pennsylvania Municipal Money Market Fund	$77,451	$0
Treasury Money Market Fund	$1,467,532	$0
U.S. Government Money Market Fund	$3,192,725	$341,838

Fund	Class B			Class C
	Distribution Fees Paid	Service Fees	Fee Reimbursement	Distribution Fees Paid	Service Fees	Fee Reimbursement
Money Market Fund	$427,316	$0	$153,831	$244,207	$0	$94,821
U.S. Government Fund	$6,498	$1,320	$846	$13,504	$0	$5,687

Fund		Class S			Class S1
			Distribution Fees Paid	Fee Reimbursement		Distribution Fees Paid	Fee Reimbursement
	California Municipal Money Market Fund		$464,383	$40,871		N/A	N/A
	Florida Municipal Money Market Fund		$1,709,752	$15,424		N/A	N/A
	Money Market Fund		$15,056,904	$1,406,891		$6,591,573	$1,872,709
	Municipal Money Market Fund		$2,316,366	$1,595		$4,290,549	$985
	New Jersey Municipal Money Market Fund		$631,582	$3,918		N/A	N/A
	New York Municipal Money Market Fund		$849,168	$4,197		N/A	N/A
	Pennsylvania Municipal Money Market Fund		$362,108	$0		N/A	N/A
	Treasury Money Market Fund		$4,385,998	$101,814		N/A	N/A
	U.S. Government Money Market Fund		N/A	N/A		$1,363,001	$156,844

Trustee Compensation

Listed below is the Trustee compensation paid by the Money Market Funds (the “Fund Group”) for the fiscal year ended January 31, 2005 and by the Trust and the ten other trusts in the Evergreen fund Complex for the twelve months ended December 31, 2004. The Trustees do not receive pension or retirement benefits from the Evergreen funds. For more information, see “Management of the Trust” in Part 2 of this SAI.

	Trustee	Aggregate Compensation from the Fund Group for fiscal year ended 1/31/2005	Total Compensation from the Evergreen Fund Complex for the twelve months ended 12/31/2004⁽¹⁾
	Charles A. Austin III	$28,860	$177,084
Shirley L. Fulton ⁽²⁾		$20,177	$122,834
	K. Dun Gifford	$28,401	$178,334
	Leroy Keith Jr.	$25,867	$162,334
	Gerald M. McDonnell	$25,864	$162,334
	William Walt Pettit	$25,607	$162,334
	David M. Richardson	$25,864	$162,334
	Russell A. Salton, III	$28,575	$178,334
	Michael S. Scofield	$36,269	$221,334
	Richard J. Shima	$28,801	$178,334
	Richard K. Wagoner	$25,864	$162,334

(1) Certain Trustees have elected to defer all or part of their total compensation for the twelve months ended December 31, 2004. The amounts listed below will be payable in later years to the respective Trustees:

Austin $106,250

Fulton $30,709

McDonnell $48,700

Pettit $56,817

Shima $62,417

(2) Ms. Fulton became a Trustee effective April 1, 2004.

SERVICE PROVIDERS

Administrator

Evergreen Investment Services, Inc. (EIS), 200 Berkeley Street, Boston, Massachusetts 02116-5034, a subsidiary of Wachovia, serves as administrator to the Funds, subject to the supervision and control of the Trust's Board of Trustees. EIS provides the Funds with facilities, equipment and personnel and is entitled to receive from each Fund annual fees at the following rate:

Average Daily Net Assets of the Evergreen Money Market Funds	Administrative Service Fee Rates
First $60 billion	0.060%
Next $40 billion	0.055%
Next $25 billion	0.050%
On assets over $125 billion	0.040%

Administrative Fees

Below are the administrative fees paid by each Fund for the last three fiscal years or periods.

Fund/Fiscal Year or Period Ended	Administrative Fees Paid
January 31, 2005
California Municipal Money Market Fund	$100,348
Florida Municipal Money Market Fund	$192,797
Money Market Fund	$5,911,079
Municipal Money Market Fund	$1,460,497
New Jersey Municipal Money Market Fund	$86,481
New York Municipal Money Market Fund	$139,416
Pennsylvania Municipal Money Market Fund	$91,396
Treasury Money Market Fund	$1,684,307
U.S. Government Money Market Fund	$860,593
January 31, 2004
California Municipal Money Market Fund	$112,502
Florida Municipal Money Market Fund	$154,471
Money Market Fund	$11,354,508
Municipal Money Market Fund	$1,661,699
New Jersey Municipal Money Market Fund	$94,995
New York Municipal Money Market Fund	$85,024
Pennsylvania Municipal Money Market Fund	$126,885
Treasury Money Market Fund	$2,107,477
U.S. Government Money Market Fund	$2,302,384
January 31, 2003
California Municipal Money Market Fund	$108,056
Florida Municipal Money Market Fund	$140,691
Money Market Fund	$13,871,672
Municipal Money Market Fund	$1,618,179
New Jersey Municipal Money Market Fund	$103,936
New York Municipal Money Market Fund	$72,698
Pennsylvania Municipal Money Market Fund	$150,118
Treasury Money Market Fund	$2,189,155
U.S. Government Money Market Fund	$2,573,728

Distributor

EIS is also the Funds' distributor and markets the Funds through broker‑dealers and other financial representatives.

Transfer Agent

Evergreen Service Company, LLC (ESC), P.O. Box 8400, Boston, Massachusetts 02266-8400, a subsidiary of Wachovia, is the Funds’ transfer agent. ESC issues and redeems shares, pays dividends and performs other duties in connection with the maintenance of shareholder accounts.

Each Fund pays ESC annual fees as follows:

Fund Type	Annual Fee Per Open Account*	Annual Fee Per Closed Account**
Money Market Funds	$26.75	$9.00

*For shareholder accounts only. Each Fund pays ESC cost plus 15% for broker accounts.

**Closed accounts are maintained on the system in order to facilitate historical and tax information.

Below are the transfer agency fees paid by each Fund to ESC for the last fiscal year.

Fund	Total Transfer Agency Fees Paid to ESC for Fiscal Year Ended January 31, 2005
California Municipal Money Market Fund	$88,874
Florida Municipal Money Market Fund	$34,032
Money Market Fund	$18,311,214
Municipal Money Market Fund	$1,059,234
New Jersey Municipal Money Market Fund	$27,013
New York Municipal Money Market Fund	$89,492
Pennsylvania Municipal Money Market Fund	$30,432
Treasury Money Market Fund	$510,025
U.S. Government Money Market Fund	$4,088,996

Independent Registered Public Accounting Firm

KPMG LLP, 99 High Street, Boston, Massachusetts 02110, audits the financial statements of the Funds.

Custodian

State Street Bank and Trust Company, 225 Franklin Street, Boston, Massachusetts 02110, keeps custody of each Fund's securities and cash and performs other related duties.

Legal Counsel

Sullivan & Worcester LLP, 1666 K Street NW, Washington, D.C. 20006, provides legal advice to the Independent Trustees of the Trust.

Ropes & Gray LLP, One International Place, Boston, MA 02110-2624, serves as counsel to the Fund.

FINANCIAL STATEMENTS

The audited financial statements for the Funds for the fiscal year ended January 31, 2005, including notes thereto, and the report of KPMG LLP, the independent registered public accounting firm thereon, are incorporated by reference from the Trust's January 31, 2005 Annual Report relating to the Funds. The Trust's January 31, 2005 Annual Report relating to the Funds was filed electronically with the SEC on April 6, 2005 (Accession No. 0000936772-05-000093). A copy of the Annual Report may be obtained without charge from Evergreen Service Company, LLC, P.O. Box 8400, Boston, Massachusetts 02266-8400 or by calling toll-free at 1.800.343.2898.

ADDITIONAL INFORMATION CONCERNING CALIFORNIA

The information set forth below is derived from sources that are generally available to investors, including official statements for debt offerings of California and other issuers in the state. The information is intended to give recent historical description and is not intended to indicate future or continuing trends in the financial or other positions of California or local issuers in the state. It should be noted that the creditworthiness of obligations issued by local issuers in the state may be unrelated to the creditworthiness of obligations issued by the State of California, and there is no obligation on the part of the State to make payments on such local obligations in the event of a default.

General

Following several years of very strong growth in the late 1990’s, which produced large State revenue surpluses, the State’s financial condition started to worsen since the start of 2001, with the combination of a mild Statewide economic recession (but with a severe downturn in the high technology sector centered in the San Francisco Bay Area) and a dramatic decline in revenue from capital gains and stock option activity resulting from the decline in stock market levels since mid-2000. Revenues in the 2002-03 fiscal year proved to be substantially lower than projections, largely because of continued weakness in the economy and stock markets. By May 2003, the Governor reported that that a budget gap of over $30 billion (after about $7 billion of budget actions had been taken earlier in 2003) would have to be addressed for the balance of the 2002-03 fiscal year and the upcoming 2003-04 fiscal year. See “Recent Financial Results – Continuing Budget Shortfall” below.

Strong partisan disagreement in the Legislature about the appropriate combination of spending reductions and revenue increases needed to close this gap led to a delay of almost one month in enactment of the 2003-04 fiscal year budget. In its final form it resembled the Governor’s proposals with a combination of large spending cuts, fund transfers, deferrals and loans, and issuance of bonds to spread out repayment over several years of an accumulated budget deficit then estimated at $10.7 billion (but subsequently recalculated at $8.6 billion). The final budget compromise recognized expressly that the balancing of the 2003-04 budget used a number of one-time budget measures and borrowings, and that there was a structural deficit of about $8 billion built into the 2004-05 fiscal year budget which would have to be addressed. The sluggish economy and cuts in State aid will adversely affect local government finances in 2004 and beyond.

In October, 2004, a successful recall election resulting in the replacement of the prior Governor with new Governor Arnold Schwarzenegger. The new Governor has proposed substantial additional spending reductions as part of the proposed 2004-05 Budget. On March 2, 2004, voters approved two companion ballot propositions which had been sponsored by the Governor. Proposition 57 authorizes issuance of $15 billion of economic recovery bonds to fund previous budget deficits. Proposition 58 implemented changes in state budget procedures designed to mandate adoption of balanced budgets in the future, to grant greater mid-year budget adjustment powers, to require creation of a budget reserve, and to prohibit future long-term borrowing to finance budget deficits (once the bonds approved by Proposition 57 are issued).

The State has been facing serious cash flow difficulties since the 2001-02 fiscal year as a result of the ongoing budget deficits and severely reduced revenues. It has had to resort to external borrowing starting in the fall of 2001 to assure sufficient cash resources to pay its ongoing obligations, including maturing cash flow notes. The State issued $11 billion of cash flow notes in mid-June 2003, and an additional $3 billion of notes in October, 2003, both issues to mature in June, 2004. Repayment of this borrowing is expected to come from ongoing revenues and proceeds from the issuance of the deficit retirement bonds approved at the March 2004 election. The State’s ability to meet its cash requirements may continue to depend on access to capital markets until it brings revenues and expenses into closer balance. See “Recent Financial Results – Cash Flow Requirements” below.

Economic Factors

California’s economy is the largest among the 50 states and one of the largest in the world. The State’s population of almost 36 million represents about 12-1/2% of the total United States population and grew by 26% in the 1980s, more than double the national rate. Population growth slowed to less than 1% annually in 1994 and 1995, but rose to almost 2% in the final years of the 1990’s. The bulk of population growth in the State is due to births and foreign immigration.

Total personal income in the State, at an estimated $1,199 billion in 2003, accounts for over 13% of all personal income in the nation. Total employment is over 16 million, the majority of which is in the service, trade and manufacturing sectors.

California began a period of strong economic growth in 1994 in virtually all sectors, particularly in high technology manufacturing and services, including computer software and other services, entertainment, tourism, and construction, and also with very strong growth in exports. The California economy outpaced the nation during this period. By the end of 2000, unemployment in the State had dropped to under 5%, its lowest level in three decades. In 2001, the State finally showed the impact of the nationwide economic slowdown, coupled with a cyclical downturn in the high technology sector (including Internet-related businesses) and entered a mild recession. International trade also slowed since the start of 2001 reflecting weakness in overseas economies (particularly in Asia). Job losses have been concentrated in the San Francisco Bay Area, particularly in high technology industries; economic conditions have been better in other parts of the State. Statewide, modest job growth appeared to have begun by early 2002, but job growth stalled by summer 2002. Between December 2002 and December 2003 non-farm employment dropped by 0.2 percent, but the unemployment was reduced from 6.9% to 6.4%. Most recent indications reported by the Department of Finance suggest that employment has been increasing in the second half of 2003 and into 2004 Residential construction and existing home sales remained strong in 2003, in part due to low interest rates, but nonresidential construction was weak for the third consecutive year in 2003. In January, 2004, the State Department of Finance projected there would be only moderate growth in the economy in 2004, with stronger growth in 2005. The Department predicts the California economy will mirror the national economy. The recession, combined particularly with the decline in the stock markets since mid-2000, resulted in much weaker State revenues in Fiscal Years 2001-02 and 2002-03 than had been previously projected, as discussed further below under “Recent Financial Results.”

Widely publicized difficulties in California’s energy supplies had been seen in early 2001 to pose some risks to the economy, but during the summers of 2001 and 2002 there were no electricity blackouts or shortages of natural gas. Although energy prices have risen from the levels of three years ago, they have now appeared to have stabilized. Energy difficulties are mitigated by the fact that California’s economy is very energy-efficient. A number of investigations and lawsuits are ongoing against energy suppliers seeking refunds for California customers for alleged overcharges during the crisis period in 2000 and 2001.

Constitutional Limitations on Taxes, Other Charges and Appropriations

Limitation on Property Taxes. Certain California Municipal Obligations may be obligations of issuers which rely in whole or in part, directly or indirectly, on ad valorem property taxes as a source of revenue. The taxing powers of California local governments and districts are limited by Article XIIIA of the California Constitution, enacted by the voters in 1978 and commonly known as “Proposition 13.” Briefly, Article XIIIA limits the rate of ad valorem property taxes to 1% of full cash value of real property and generally restricts the reassessment of property to 2% per year, except upon new construction or change of ownership (subject to a number of exemptions). Taxing entities may, however, raise ad valorem taxes above the 1% limit to pay debt service on voter-approved bonded indebtedness.

Under Article XIIIA, the basic 1% ad valorem tax levy is applied against the assessed value of property as of the owner’s date of acquisition (or as of March 1, 1975, if acquired earlier), subject to certain adjustments. This system has resulted in widely varying amounts of tax on similarly situated properties. Several lawsuits were filed challenging the acquisition-based assessment system of Proposition 13, but it was upheld by the U.S. Supreme Court in 1992.

Article XIIIA prohibits local governments from raising revenues through ad valorem taxes above the 1% limit; it also requires voters of any governmental unit to give two-thirds approval to levy any “special tax.”

Limitations on Other Taxes, Fees and Charges. On November 5, 1996, the voters of the State approved Proposition 218, called the “Right to Vote on Taxes Act.” Proposition 218 added Articles XIIIC and XIIID to the State Constitution, which contain a number of provisions affecting the ability of local agencies to levy and collect both existing and future taxes, assessments, fees and charges.

Article XIIIC requires that all new or increased local taxes be submitted to the voters before they become effective. Taxes for general governmental purposes require a majority vote and taxes for specific purposes require a two-thirds vote.

Article XIIID contains several new provisions making it generally more difficult for local agencies to levy and maintain “assessments” for municipal services and programs. Article XIIID also contains several new provisions affecting “fees” and “charges”, defined for purposes of Article XIIID to mean “any levy other than an ad valorem tax, a special tax, or an assessment, imposed by a [local government] upon a parcel or upon a person as an incident of property ownership, including a user fee or charge for a property related service.” All new and existing property related fees and charges must conform to requirements prohibiting, among other things, fees and charges which generate revenues exceeding the funds required to provide the property related service or are used for unrelated purposes. There are new notice, hearing and protest procedures for levying or increasing property related fees and charges, and, except for fees or charges for sewer, water and refuse collection services (or fees for electrical and gas service, which are not treated as “property related” for purposes of Article XIIID), no property related fee or charge may be imposed or increased without majority approval by the property owners subject to the fee or charge or, at the option of the local agency, two-thirds voter approval by the electorate residing in the affected area.

In addition to the provisions described above, Article XIIIC removes limitations on the initiative power in matters of local taxes, assessments, fees and charges. Consequently, local voters could, by future initiative, repeal, reduce or prohibit the future imposition or increase of any local tax, assessment, fee or charge. It is unclear how this right of local initiative may be used in cases where taxes or charges have been or will be specifically pledged to secure debt issues.

The interpretation and application of Proposition 218 will ultimately be determined by the courts with respect to a number of matters, and it is not possible at this time to predict with certainty the outcome of such cases.

Appropriations Limits. The State and its local governments are subject to an annual “appropriations limit” imposed by Article XIIIB of the California Constitution, enacted by the voters in 1979 and significantly amended by Propositions 98 and 111 in 1988 and 1990, respectively. Article XIIIB prohibits the State or any covered local government from spending “appropriations subject to limitation” in excess of the appropriations limit imposed. “Appropriations subject to limitation” are authorizations to spend “proceeds of taxes,” which consist of tax revenues and certain other funds, including proceeds from regulatory licenses, user charges or other fees, to the extent that such proceeds exceed the cost of providing the product or service, but “proceeds of taxes” exclude most State subventions to local governments. No limit is imposed on appropriations of funds which are not “proceeds of taxes,” such as reasonable user charges or fees, and certain other non-tax funds, including bond proceeds.

Among the expenditures not included in the Article XIIIB appropriations limit are (1) the debt service cost of bonds issued or authorized prior to January 1, 1979, or subsequently authorized by the voters, (2) appropriations to comply with mandates of courts or the federal government, (3) appropriations for certain capital outlay projects, (4) appropriations by the State of post-1989 increases in gasoline taxes and vehicle weight fees, and (5) appropriations made in certain cases of emergency.

The appropriations limit for each year is adjusted annually to reflect changes in cost of living and population, and any transfers of service responsibilities between government units. The definitions for such adjustments were liberalized in 1990 to follow more closely growth in the State’s economy.

“Excess” revenues are measured over a two year cycle. Local governments must return any excess to taxpayers by rate reductions. The State must refund 50% of any excess, with the other 50% paid to schools and community colleges. With more liberal annual adjustment factors since 1988, and depressed revenues in the early 1990’s because of the recession, few governments have been operating near their spending limits, but this condition may change over time. Local governments may by voter approval exceed their spending limits for up to four years. Because of extraordinary revenue receipts in fiscal year 1999-2000, State appropriations were estimated to be about $975 million above the limit. However, since the State was $2.1 billion below its limit in fiscal year 2000-01, resulting in no excess over the two-year period, no refunds were made. 1999-2000 was the only fiscal year since the late 1980’s when State appropriations were above the limit. The State Department of Finance estimates the State will be about $13.4 billion below its appropriation limit in fiscal year in 2003-04 and about $12.8 billion below the limit in 2004-05.

Because of the complex nature of Articles XIIIA, XIIIB, XIIIC and XIIID of the California Constitution, the ambiguities and possible inconsistencies in their terms, and the impossibility of predicting future appropriations or changes in population and cost of living, and the probability of continuing legal challenges, it is not currently possible to determine fully the impact of these Articles on California municipal obligations or on the ability of the State or local governments to pay debt service on such California municipal obligations. It is not possible, at the present time, to predict the outcome of any pending litigation with respect to the ultimate scope, impact or constitutionality of these Articles or the impact of any such determinations upon State agencies or local governments, or upon their ability to pay debt service on their obligations. Further initiatives or legislative changes in laws or the California Constitution may also affect the ability of the State or local issuers to repay their obligations.

Obligations of the State of California

Under the California Constitution, debt service on outstanding general obligation bonds is the second charge to the General Fund after support of the public school system and public institutions of higher education. As of February 1, 2004, the State had outstanding approximately $31.3 billion of long-term general obligation bonds and $6.9 billion of lease-purchase debt supported by the State General Fund. The State issued $2.0 billion of general obligation bonds in late February 2004 and $1.80 billion in April 2004. As of February 1, 2004 the State had about $22.2 billion of authorized and unissued long-term general obligation bonds and $4.3 billion of authorized and unissued lease-purchase debt. Voters approved a $12.3 billion bond authorization for public school and university construction at the March 2, 2004 election, plus $15 billion of deficit financing bonds (Proposition 57) which are additionally secured by a portion of the State’s sales tax. The State plans to sell about $12.3 billion of the deficit financing bonds (called “economic recovery bonds”) before the end of June, 2004. The remainder of the $15 billion authorization may be issued later in the 2004-05 fiscal year, if needed to help balance the 2005-06 budget. In FY 2002-03, debt service on general obligation bonds and lease purchase debt was approximately 3.5% of General Fund revenues. Additional bond authorizations may be on the ballot in November 2004. See also “Bond Ratings” below.

Recent Financial Results

The principal sources of General Fund tax revenues in 2002-03 were the California personal income tax (48 percent of total tax revenues), the sales tax (35 percent), corporation taxes (8 percent), and the gross premium tax on insurance (2 percent). A large portion of personal income tax receipts was derived from capital gains realizations and stock option income. While these sources have been extraordinarily strong in the late 1990’s and 2000, they are particularly volatile. In preparing the most recent budget, the State took account of the recent drop in stock market levels and reduced its estimated receipts from these revenues as compared to prior years. The Department of Finance has projected that this source of revenue dropped from 25% of all General Fund revenues in 2000-01 to 11% in 2001-02 and 8% in 2002-03; this represents the bulk of the total General Fund revenue shortfall in these two fiscal years.

The State maintains a Special Fund for Economic Uncertainties (the “SFEU”), derived from General Fund revenues, as a reserve to meet cash needs of the General Fund, but which is required to be replenished as soon as sufficient revenues are available. Year-end balances in the SFEU are included for financial reporting purposes in the General Fund balance.

Throughout the 1980’s, State spending increased rapidly as the State population and economy also grew rapidly, including increased spending for many assistance programs to local governments, which were constrained by Proposition 13 and other laws. The largest State program is assistance to local public school districts. In 1988, an initiative (Proposition 98) was enacted which (subject to suspension by a two-thirds vote of the Legislature and the Governor) guarantees local school districts and community college districts a minimum share of State General Fund revenues (currently about 35 percent).

The substantial declines in the stock markets have adversely affected the earnings of State pension funds, and have created unfunded future pension liabilities, where there had been surpluses several years ago. The State’s annual contributions to the Public Employee’s Retirement System have increased from $157 million in FY 2000-01 to $2.2 billion in FY 2003-04.

Balanced Budget Amendment

On March 2, 2004, voters approved Proposition 58, a constitutional amendment called the “Balanced Budget Amendment,” which will affect future State budgeting procedures. This amendment was linked to Proposition 57, also approved by the voters, which authorized issuance of $15 billion of long-term general obligation bonds, additionally secured by a 1/4 cent increment of the State’s sales tax, which will eliminate the accumulated budget deficits through June 30, 2004 and certain additional obligations incurred by the State.

The Balanced Budget Amendment will require the Legislature, starting in the 2004-05 fiscal year, to enact a budget bill in which General Fund expenditures do not exceed estimated General Fund revenues and available reserves After passage of the budget act, if the Governor determines that the State is facing substantial revenue shortfalls or spending deficiencies, the Governor may declare a fiscal emergency, and propose legislation to address the emergency. The Legislature would be called in to special session to address this proposal. If the Legislature failed to send legislation to the Governor to address the fiscal emergency within 45 days, it would be prohibited from acting on any other bills or adjourning until fiscal legislation is passed.

The Amendment also creates a special reserve called the Budget Stabilization Account in the State General Fund. Beginning in FY 2006-07, a portion of estimated annual General Fund revenues would be transferred by the Controller into the Account not later than September 30 of each year. The transfer begins at 1 percent of revenues, and increases annually to reach a level of 3 percent. The transfers would continue until the Budget Stabilization Account reaches a balance of the greater of $8 billion or 5 percent of General Fund revenue. Moneys in the Account may be used to make up for unexpected budget imbalances, but will then have to be replenished with future transfers until the target level is reached. The annual transfer can be suspended by the Governor by an executive order issued not later than June 1 of the preceding fiscal year. The Amendment requires that one half of the Budget Stabilization Account deposits, up to an aggregate of $5 billion, shall be transferred to the State Treasurer to provide for early redemption of the deficit retirement bonds approved by Proposition 57.

A final provision of the Amendment will prohibit future long-term bond issuances for the purpose of funding budget deficits, once the bonds authorized by Proposition 57 are issued. Short term borrowing for cash flow management will continue to be authorized.

Recent Budgets.

The economy, and especially the stock markets, grew strongly during the second half of the 1990’s, and as a result, the General Fund took in substantially greater tax revenues (an aggregate of more than $20 billion over the six fiscal years 1995-96 through 2000-01) than were initially planned when the budgets were enacted. These additional funds were largely directed to school spending as mandated by Proposition 98, and to make up shortfalls from reduced federal health and welfare aid in 1995-96 and 1996-97. In 1998-99 through 2000-01, new spending programs were also enacted, particularly for education, new capital outlay projects were funded from current receipts, and significant tax reductions were enacted. The Department of Finance estimates that the State’s budget reserve (the SFEU) reached a high point of $8.7 billion at June 30, 2000. In the ensuing three years, the combination of continuing high spending levels and substantially reduced revenues resulting from the economic slowdown and stock market decline brought the estimated balance of the SFEU to a negative $8.6 billion by June 30, 2003.

The growth in General Fund revenues since 1994-95 resulted in significant increases in State funding for local school districts under Proposition 98. From the 1994-95 level of about $4,200 per pupil, annual State funding has increased to just below $7,000 per pupil in FY 2003-04. A significant amount of the new moneys have been directed to specific educational reforms, including reduction of class sizes in many grade levels.

Part of the 1997-98 Budget Act was completion of State welfare reform legislation to implement the new federal law passed in 1996. The new State program, called “CalWORKs,” became effective January 1, 1998, and emphasizes programs to bring aid recipients into the workforce. As required by federal law, new time limits are placed on receipt of welfare aid. Generally, health and welfare costs have been contained even during the recent period of economic recovery, with the first real increases (after inflation) in welfare support levels occurring in 1999-2000 and additional increases in 2000-01.

An important element of recent Budget Acts (during the years of large capital gains receipts) was agreement on substantial tax cuts. The largest of these was a phased-in cut in the Vehicle License Fee (an annual tax on the value of cars registered in the State, the “VLF”). Starting on January 1, 1999, the VLF was reduced by 25 percent, which was increased in steps to a 67.5% reduction effective January 1, 2001. Under pre-existing law, VLF funds were automatically transferred to cities and counties, so the new legislation provided for the General Fund to make up the reductions. The full 67.5% percent VLF cut was offset by transfers of about $4.2 billion annually from the General Fund. Other miscellaneous business and personal tax cuts and tax credits were of a much smaller overall amount.

The previous Governor attempted to raise the VLF back to its 1998 level because of shortfalls in General Fund money to make the “offset” to cities and counties This action was challenged in court. Subsequently, the newly elected Governor Schwarzenegger reversed this action and committed to retain the VLF cut and the offset to local governments. This action, too, has been challenged in court.

Fiscal Year 2002-03 Budget

The magnitude of the budget gap which had to be addressed led to a substantial delay in enactment of the 2002-03 Budget Act (“2003 Budget Act”) until September 5, 2002, more than two months into the fiscal year. Despite delay in approval of the 2003 Budget Act, most State operations continued based on continuing appropriation legislation, constitutional requirements or court orders. Debt service on State debt was paid, most health and welfare programs and education payments were funded, and State employees, other than elected officials and senior management employees, were paid.

The 2002 Budget Act addressed a $23.6 billion gap between expenditures and resources through a combination of program reductions, internal loans, bond issuances, fund shifts, accelerations and transfers, and modest tax changes. Some of these actions and assumptions ultimately proved to be unavailable, and revenues in the 2002-03 fiscal year continued to decline from original projections, as economic growth stalled instead of increasing, as had been expected.

By November, 2002, reports both from the independent Legislative Analyst’s Office and the Department of Finance made clear that the 2002-03 budget would fall far short of projections. As part of the 2003-04 Governor’s Budget proposal, released January 10, 2003 (the “2004 Governor’s Budget”), the Governor called for immediate actions to reduce the budget gap by about $10.2 billion, of which $5.5 billion would be seen in 2002-03 and the balance in 2003-04. In March and April 2003, the Legislature passed budget adjustment legislation including spending reductions, deferrals, bond authorization and funding transfers totaling about $3.3 billion in fiscal year 2002-03 and about $3.6 billion in fiscal year 2003-04.

Fiscal Year 2003-04 Budget

Original Budget Proposal The Proposed 2003-04 Governor’s Budget released on January 10, 2003 (the “2004 Governor’s Budget”) projected a continuing, significant downward revision of estimated State revenues, and indicated that for the combined 2002-03 and 2003-04 period, the nominal budget “gap” to be addressed was in the neighborhood of $35 billion. This consisted of about $17.7 billion of reduced revenues compared to earlier projections, $4.5 billion of additional expenditures, and the “loss” of $12.6 billion in budgetary resources allocated to one-time budgetary actions taken in the 2002 Budget Act which could not be duplicated (such as the sale of future tobacco settlement receipts).

The 2004 Governor’s Budget sought to close the entire $35 billion gap in the context of actions which would be completed by the end of the 2003-04 fiscal year. The plan included about $20.8 billion of spending reductions, a plan to transfer responsibility for many health and social services programs to local governments, relieving the State of over $8.1 billion of costs, and about $5.8 billion of additional funding shifts and transfers, loans, and other revenues. Certain new taxes were proposed to fund the local governments’ increased costs for the programs to be shifted.

May Revision As noted above some budget reductions were passed by the Legislature in March and April, 2003, but less than the amounts requested by the Governor. In May 2003, the Governor released the May Revision to the 2004 Governor’s Budget (“2004 May Revision”), which updated forecasts and provided a substantially revised budget plan for 2003-04.

First, the 2004 May Revision estimated that the budget gap had grown to about $38.2 billion (not counting the actions already taken), largely due to the cancellation of the $2 billion tobacco securitization scheduled in April 2003, and higher caseloads in certain programs. Actual tax revenues were reported to be very close to the projections made in the 2004 Governor’s Budget in January, with some small signs of recovery in personal income tax withholding and corporate tax receipts.

In the 2004 May Revision, the Governor recognized that many of his earlier proposals required more analysis, and that many parties preferred to solve the budget problem over more than one year. Accordingly, the 2004 May Revision divided the $38.2 billion gap into three main components:

1. The Governor proposed to fund the estimated accumulated budget deficit as of June 30, 2003 of $10.7 billion with issuance of deficit retirement bonds during 2003-04, to be repaid from a dedicated one-half cent increase in the State sales tax, which would disappear once the bonds were repaid. Repayment of these bonds would be based on annual appropriations.

2. Once the accumulated deficit was removed from the books, the 2003-04 budget would be balanced with a combination of spending cuts, interfund loans and transfers, and some additional borrowing. A major assumption in the 2004 May Revision was that the State would terminate its payments to local governments to “backfill” the offset to vehicle license fees enacted several years ago, which costs the State $4.2 billion per year. The Administration expected that action could be taken under existing law to terminate the backfill and have the vehicle license fee paid by drivers increased back to the original level, so that local governments would not be harmed by this shift. The overall budget plan for 2003-04 called for revenues and transfers of $70.9 billion and expenditures of $70.4 billion, leaving a budget reserve of about $500 million.

3. The 2004 May Revision explicitly recognized that balancing the 2003-04 budget still left an ongoing “structural deficit,” which would cause the 2004-05 budget to be about $7.9 billion out of balance in the absence of corrective action.

Final Budget Act Members of the Legislature and the Governor were unable to reach agreement on a budget package before the start of the fiscal year on July 1, 2003, with strong partisan disagreements about the necessary elements of spending cuts and revenue increases needed to complete the budget. Without budget authorization, a number of spending programs were suspended as of July 1, including payments to vendors for new goods and services, some aid to local governments and schools and others; however high-priority obligations such as debt service payments continued to be made.

The 2003-04 Budget Act was finally passed by the Legislature and signed by the Governor on August 2, 2003. It resolved the budget gap with a combination of external borrowing, spending reductions, new revenues, funding shifts and internal loans and deferrals. It assumed a year-end budget reserve at June 30, 2004 of almost $2 billion, and also assumed the 2004-05 fiscal year budget would have at least a $7.9 billion structural deficit to be closed. The principal features of the budget were as follows:

1. As proposed by the Governor in the 2004 May Revision, the Legislature authorized the issuance of “fiscal recovery bonds” designed to provide an estimated $10.7 billion of cash into the General Fund, representing the accumulated deficit as of June 30, 2003. (The new Administration has subsequently estimated that because of stronger revenue results than anticipated, the June 30, 2003 budget deficit was only about $8.6 billion.) Issuance of these bonds had been delayed because of a legal challenge which was pending in court, but on March 2, 2004, voters approved Proposition 57 to authorize $15 billion of general obligation “economic recovery bonds” to replace the fiscal recovery bonds approved in July.

2. The budget also assumed two other external borrowings. The first was the second part of a tobacco securitization sale, postponed from spring, 2003. This sale was completed in September 2003 and produced about $2.2 billion of General Fund revenue. The second was the sale of pension obligation bonds (“POBs”) to make the 2003-04 payments due to the State Public Employee’s Retirement System, in the amount of about $1.9 billion. The POB sale was prevented from going ahead by an adverse court decision, which is presently being appealed, but the time needed to complete the appeal means this financing cannot occur in time to assist the 2003-04 budget.

3. As noted, the budget relied on substantial savings in program costs, spread across most programs. K-12 schools will receive the minimum funding required by Proposition 98, but this will result in a small decrease in per-pupil spending, to about $6,900 per pupil. Significant cuts were made in higher education support, to be offset in part by student fee increases in the range of 30%. Other fee increases will offset reductions in support for trial courts and resources programs. Health and social service costs were limited by foregoing cost of living increases and reducing Medi-Cal provider rates. State personnel costs were to be reduced by voluntary agreements to be negotiated with employee unions or layoffs.

4. The budget assumed receipt of about $1.8 billion in new federal funding as a result of federal law passed to assist States. The budget also assumed the $4.2 billion annual savings resulting from the increase of the vehicle license fee. Another major one-time budget action was a shift in Medi-Cal accounting to add about $930 million in 2003-04. There were no other tax or revenue increases, aside from certain fees. The Governor’s realignment proposal to transfer certain health and social services programs to local governments was not enacted.

Proposed 2004-05 Governor’s Budget

The Proposed 2004-05 Governor’s Budget (the “2005 Governor’s Budget”) released on January 9, 2004 by the new Schwarzenegger Administration, reported that, in the absence of corrective action to change existing policies, operating deficits of about $14 billion would be incurred for FY 2004-05. The Governor proposed about $3.9 billion of mid-year budget actions, most of which had not been adopted as of May 1, 2004.

The original 2003-04 Budget Act estimated a budget reserve (SFEU) at June 30, 2004 of about $2 billion. The 2004 Governor’s Budget revised this estimate to about $290 million, assuming enactment of the mid-year budget adjustment proposals. Some of the others major changes in the 2003-04 budget estimate include the following:

1. $2 billion in increased revenues from stronger economic activity.

2. $3 billion in additional resources from sale of the Proposition 57 economic recovery bonds, as compared to the earlier fiscal recovery bond plan. Under the current plan, the State plans to issue about $12.3 billion of economic recovery bonds by June, 2004, of which about $9.3 billion will be allocated to repayment of prior budget deficits.

3. Loss of revenues from sale of pension obligation bonds, and elimination of the expected receipt of revenue from renegotiating gaming compacts with Indian tribes (although these negotiations are currently ongoing).

4. Additional expenditures of about $2.65 billion to maintain the payment of the VLF offsets to local governments.

The Governor’s proposed 2004-05 Budget will be subject to negotiations with the Legislature over the coming months. The major elements of the Governor’s proposal include the following:

1. Resetting the minimum Proposition 98 funding guarantee for public schools to save about $2 billion. This will still provide an increase in funding for public schools. Additional funding cuts will be made for higher education units, to be offset by higher student fees.

2. Major reforms of the Medi-Cal program to reduce costs. The Governor also proposes to increase work incentives to allow reduced expenditures under the CalWORKS welfare program. The Governor proposes a wide range of reductions in health and social services programs.

3. Proposed reform of public pension costs, to be negotiated with employees, to reduce future costs. The Governor also proposed a $929 million pension obligation bond issuance assuming timely and successful appeal of the lawsuit which blocked the 2003 pension obligation bond issue.

4. Use of about $3 billion of Proposition 57 economic recovery bond proceeds.

5. Reduced General Fund payments to schools by transferring an additional $1.3 billion of city and county property taxes to school districts, to be a permanent shift.

6. Reduction of $1.1 billion by suspending planned General Fund expenditures for the Transportation Investment Fund enacted several years earlier in better fiscal times.

Overall, the 2004 Governor’s Budget projects General Fund revenues of $76.4 billion, a decrease of $1.2 billion from revised estimates for 2003-04. Expenditures are projected at $76.1 billion, also a decrease of $1.2 billion from 2003-04. The year-end budget reserve (SFEU) is projected to be about $635 million.

Updated revenue and expenditure projections for FY 2003-04, and an updated budget proposal for FY 2004-05 will be released by the Governor on May 14, 2004.

The Governor has implemented a California Performance Review, which will carry out a comprehensive analysis of State government. The major areas for review will include: executive branch reorganization, program performance assessment and budgeting, improved services and productivity, and acquisition reform.

Ongoing “Structural Deficit”

The independent Legislative Analyst’s Office (“LAO”) has reported for several years that the State is facing a “structural deficit,” because of a continuing imbalance between its basic level of revenues and its mandated spending levels for enacted programs. While the LAO reported in February 2004 that the 2004 Governor’s Budget represented a “solid starting point for budgetary negotiations,” it noted that a number of the solutions proposed by the Governor might not be realized, which could increase the budget gap by up to another $4 billion. The LAO also reported that going forward, a gap of about $7 billion would occur in FY 2005-06 and subsequent years, absent additional corrective actions to bring revenues and expenditures into balance.

Cashs Flow Requirements

The State typically funds its day-to-day operating requirements of the General Fund from revenue receipts, interfund borrowing from special funds, and external borrowing in the form of revenue anticipation notes (“RANs”), which fund annual cash flow requirements and are repaid within the same fiscal year, and revenue anticipation warrants (“RAWs”) which are issued only when it is necessary to bridge a budgetary deficit over the end of a fiscal year. The State’s ongoing revenue shortfalls and budget deficits incurred in the last three fiscal years, along with certain unique factors associated with the State’s energy crisis in 2001, placed severe pressure on the State’s cash resources, and required an unprecedented amount of short-term cash flow borrowing

The State sold a record $12.5 billion of RANs in October 2002, due in June 2003, to cover its cash flow needs. By mid-winter 2003 it became evident that the State would have a cash shortfall by the end of June 2003, when the $12.5 billion RANs came due. Accordingly, the State issued $11 billion of RAWs, also a record, on June 18, 2003 to pay the RANs and other obligations coming due in June 2003, and to cover cash flow requirements through late August. To sell these RAWs, the State was required to obtain credit support from a group of financial institutions. The State issued $3 billion of RANs in October 2003 to fund the remainder of its cash management needs for FY2003-04. For the first time, the entire State RAN issue was supported by external bank credit. The RAWs mature on June 16, 2004 and the RANs mature on June 23, 2004.

The State anticipates that it will repay the RAWs and RANs in June 2004 with a combination of current revenues and proceeds of the Proposition 57 economic recovery bonds. If for any reason this sale cannot be accomplished, the RAWs and RANs will all be paid by drawing on available credit support instruments, but such an action will require the State to immediately divert all revenues (after payment of constitutionally mandated Priority Payments, such as school funding and general obligation bond debt service) to start repaying the financial institutions. This would severely restrict the State’s ongoing cash management process. Until the State brings the “structural imbalance” between its revenue sources and spending obligations into balance, it may continue to depend on having access to the public debt markets in order to fund its ongoing cash obligations and to repay cash flow borrowings.

Bond Ratings

The ratings on California’s long-term general obligation bonds were reduced in the early 1990’s from “AAA” levels which had existed prior to the recession. After 1996, through the end of 2000, the three major rating agencies raised their ratings of California’s general obligation bonds as high as “AA” from Standard & Poor’s, “Aa2” from Moody’s and “AA” from Fitch. Starting in December 2002, as the State’s budget and cash condition worsened, all three rating agencies reduced the ratings of California’s general obligation bonds. As of March 1, 2004, Standard & Poor’s had reduced California’s senior ratings to “BBB,” Fitch had reduced the ratings to “BBB” and Moody’s had reduced its ratings to “Baa2.” Fitch maintained the State’s credit ratings on watch with negative implications. S&P considers the State’s rating outlook as “positive.” The State’s economic recovery bonds have received higher ratings than the regular general obligations bonds, because of the additional pledge of a dedicated stream of sales tax revenues.

There can be no assurance that current ratings will be maintained in the future. It should be noted that the creditworthiness of obligations issued by local California issuers may be unrelated to creditworthiness of obligations issued by the State of California, and that there is no obligation on the part of the State to make payment on such local obligations in the event of default.

Legal Proceedings

The State is involved in certain legal proceedings (described in the State’s recent financial statements) that, if decided against the State, may require the State to make significant future expenditures or may substantially impair revenues. If the State eventually loses any of these cases, the final remedies may not have to be implemented in one year.

Obligations of Other Issuers

Other Issuers of California Municipal Obligations. There are a number of State agencies, instrumentalities and political subdivisions of the State that issue Municipal Obligations, some of which may be conduit revenue obligations payable from payments from private borrowers. These entities are subject to various economic risks and uncertainties, and the credit quality of the securities issued by them may vary considerably from the credit quality of obligations backed by the full faith and credit of the State.

State Assistance. Property tax revenues received by local governments declined more than 50% following passage of Proposition 13. Subsequently, the California Legislature enacted measures to provide for the redistribution of the State’s General Fund surplus to local agencies, the reallocation of certain State revenues to local agencies and the assumption of certain governmental functions by the State to assist municipal issuers to raise revenues. Total local assistance from the State’s General Fund was budgeted at approximately 75% of General Fund expenditures in recent years, including the effect of implementing reductions in certain aid programs. To reduce State General Fund support for school districts, the 1992-93 and 1993-94 Budget Acts caused local governments to transfer $3.9 billion of property tax revenues to school districts, representing loss of the post-Proposition 13 “bailout” aid. Local governments have in return received greater revenues and greater flexibility to operate health and welfare programs. The Governor has proposed a further $1.3 billion annual property tax shift for 2004-05 and subsequent years.

In 1997, a new program provided for the State to substantially take over funding for local trial courts (saving cities and counties some $400 million annually). In recent years, the State has provided over $350 million to support local law enforcement costs. The current fiscal crisis may result in some reductions in these payments in 2003-04 and beyond.

To the extent the State should be constrained by its Article XIIIB appropriations limit, or its obligation to conform to Proposition 98, or other fiscal considerations, the absolute level, or the rate of growth, of State assistance to local governments may continue to be reduced. Any such reductions in State aid could compound the serious fiscal constraints already experienced by many local governments, particularly counties. The recent economic slowdown in the State, with its corresponding reduction in State and local revenues, will put additional pressure on local government finances in the coming years. See “Recent Financial Results—Continuing Budget Shortfall” and “---Fiscal Year 2004-05 Budget.”

Counties and cities may face further budgetary pressures as a result of changes in welfare and public assistance programs, which were enacted in August, 1997 in order to comply with the federal welfare reform law. Generally, counties play a large role in the new system, and are given substantial flexibility to develop and administer programs to bring aid recipients into the workforce. Counties are also given financial incentives if either at the county or statewide level, the “Welfare-to-Work” programs exceed minimum targets; counties are also subject to financial penalties for failure to meet such targets. Counties remain responsible to provide “general assistance” for able-bodied indigents who are ineligible for other welfare programs. The long-term financial impact of the new CalWORKs system on local governments is still unknown.

Local governments are facing substantial increases in future pension liabilities and health care costs for retirees, and increases in current contribution rates, as a result of (a) generous new retirements benefits granted to employees during recent economic boom times, and (b) reduced earnings resulting from the stock market declines during the 2000-2003 period.

Assessment Bonds. California Municipal Obligations which are assessment bonds may be adversely affected by a general decline in real estate values or a slowdown in real estate sales activity. In many cases, such bonds are secured by land which is undeveloped at the time of issuance but anticipated to be developed within a few years after issuance. In the event of such reduction or slowdown, such development may not occur or may be delayed, thereby increasing the risk of a default on the bonds. Because the special assessments or taxes securing these bonds are not the personal liability of the owners of the property assessed, the lien on the property is the only security for the bonds. Moreover, in most cases the issuer of these bonds is not required to make payments on the bonds in the event of delinquency in the payment of assessments or taxes, except from amounts, if any, in a reserve fund established for the bonds.

California Long Term Lease Obligations. Based on a series of court decisions, certain long-term lease obligations, though typically payable from the general fund of the State or a municipality, are not considered “indebtedness” requiring voter approval. Such leases, however, are subject to “abatement” in the event the facility being leased is unavailable for beneficial use and occupancy by the municipality during the term of the lease. Abatement is not a default, and there may be no remedies available to the holders of the certificates evidencing the lease obligation in the event abatement occurs. The most common cases of abatement are failure to complete construction of the facility before the end of the period during which lease payments have been capitalized and uninsured casualty losses to the facility (e.g., due to earthquake). In the event abatement occurs with respect to a lease obligation, lease payments may be interrupted (if all available insurance proceeds and reserves are exhausted) and the certificates may not be paid when due. Although litigation is brought from time to time which challenges the constitutionality of such lease arrangements, the California Supreme Court issued a ruling in August, 1998 which reconfirmed the legality of these financing methods.

Other Considerations

The repayment of industrial development securities secured by real property may be affected by California laws limiting foreclosure rights of creditors. Securities backed by health care and hospital revenues may be affected by changes in State regulations governing cost reimbursements to health care providers under Medi-Cal (the State’s Medicaid program), including risks related to the policy of awarding exclusive contracts to certain hospitals.

Limitations on ad valorem property taxes may particularly affect “tax allocation” bonds issued by California redevelopment agencies. Such bonds are secured solely by the increase in assessed valuation of a redevelopment project area after the start of redevelopment activity. In the event that assessed values in the redevelopment project decline (e.g., because of a major natural disaster such as an earthquake), the tax increment revenue may be insufficient to make principal and interest payments on these bonds. Both Moody’s and S&P suspended ratings on California tax allocation bonds after the enactment of Articles XIIIA and XIIIB, and only resumed such ratings on a selective basis.

Proposition 87, approved by California voters in 1988, requires that all revenues produced by a tax rate increase go directly to the taxing entity which increased such tax rate to repay that entity’s general obligation indebtedness. As a result, redevelopment agencies (which, typically, are the issuers of tax allocation securities) no longer receive an increase in tax increment when taxes on property in the project area are increased to repay voter-approved bonded indebtedness.

The effect of these various constitutional and statutory changes upon the ability of California municipal securities issuers to pay interest and principal on their obligations remains unclear. Furthermore, other measures affecting the taxing or spending authority of California or its political subdivisions may be approved or enacted in the future. Legislation has been or may be introduced which would modify existing taxes or other revenue-raising measures or which either would further limit or, alternatively, would increase the abilities of state and local governments to impose new taxes or increase existing taxes. It is not possible, at present, to predict the extent to which any such legislation will be enacted. Nor is it possible, at present, to determine the impact of any such legislation on California Municipal Obligations in which the Fund may invest, future allocations of state revenues to local governments or the abilities of state or local governments to pay the interest on, or repay the principal of, such California Municipal Obligations.

Substantially all of California is within an active geologic region subject to major seismic activity. Northern California in 1989 and Southern California in 1994 experienced major earthquakes causing billions of dollars in damages. The federal government provided more than $13 billion in aid for both earthquakes, and neither event has had any long-term negative economic impact. Any California Municipal Obligation in the Fund could be affected by an interruption of revenues because of damaged facilities, or, consequently, income tax deductions for casualty losses or property tax assessment reductions. Compensatory financial assistance could be constrained by the inability of (i) an issuer to have obtained earthquake insurance coverage rates; (ii) an insurer to perform on its contracts of insurance in the event of widespread losses; or (iii) the federal or State government to appropriate sufficient funds within their respective budget limitations.

ADDITIONAL INFORMATION CONCERNING FLORIDA

State Economy

General.Florida is the nation’s fourth most populous state with an estimated population of 15,982,824 as of the 2000 census. This represents approximately 23.5% growth since the 1990 census. Pending confirmation, the Office of Economic and Demographic Research of the Florida legislature estimated that Florida’s population would be at 17,509,305 at the end of 2004, and to increase to over 18,000,000 by the end of 2006. The Demographic Estimating Conference Database projects Florida’s population will exceed 19,300,000 by 2010 and 22,500,000 by 2020.

Demographics.Despite a recent slowing in the rate of growth in new residents, Florida remains one of the fastest growing states in the nation. During the 1990’s, the number of people in the state rose by 3 million – only California and Texas grew by more during the decade. Slower growth is expected during the first decade of the 21^st century with Florida’s population expected to grow to over 19,300,000 by 2010.

While Florida’s rate of growth was less during the 1990’s than during the 1980’s when growth was nearly 33%, it remains the fourth largest state behind California with 35.9 million residents, Texas with 22.5 million, and New York with 19.2 million. Nationally, the U.S. grew by 13.2% between 1990 and 2000.

Within the state, the 1990’s saw five counties increase in residents by more than 60% (Flagler, Sumter, Collier, Wakulla, and Osceola). Beginning in 2000, Wakulla County’s growth has slowed, but the other four high growth counties have experienced four-year growth rates in excess of 21%. In addition, both Walton and St. Johns Counties also have four-year growth rates exceding of 21%.

Population growth depends on two components – natural increase, the difference between births and death, and migration, both domestic and international. During the 1990’s, natural increases accounted for 14.7% of the growth and net migration accounted for 85.3% of the increase. The period from April 1, 2000 to April 1, 2004 showed that natural increases accounted for only 10.5%, while net migration accounted for 89.5% of Florida’s population growth. The Census Bureau has estimated that approximately 36% of Florida’s net migration results from migration from other countries.

Florida’s age distribution in 2000, showed changes in the aging of Florida’s population. In 1980, there were 1,687,705 Floridians aged 65 and older (17.3% of the total population). The 1990 census enumerated 2,355,938 elderly (18.2% of total) while the April 1, 2000 census enumerated 2,807,650 in this group (17.6% of the total). These changes represent increases of 70.6% between 1970 and 1980, 39.6% between 1980 and 1990, and 19.2% between 1990 and 2000, somewhat lower than the overall statewide growth rate of 23.5% during the 1990’s. Florida’s 65 and over population is projected to grow to 3,426,890 (17.7% of the total) by 2010, an increase of 22.1% over the 2000 number, and to 4,689,476 (20.8% of the total) by 2020.

The population aged 85 and older was one of the fastest growing age segments during the 1980s, increasing by 75.1%. This group grew by 61.2% during the 1990s, more than twice the rate of growth for the state. Growth of the 85 and older group is expected to slow to about 54% during the 2000-2010 decade.

The youth population (ages 0-19) has shown increasing growth rates over the last 30 years – from 15.5% between 1970 and 1980 to 25.2% between 1990 and 2000. In 1980, there were 2,688,242 persons aged 0 to 19 (27.6% of the total population). In 1990, the youth population had grown to 3,232,493 (25.0% of the population) and in 2000, there were 4,048,632 youth (25.3% of the population). It is projected that the 2010 census will count 4,745,334 persons age 19 and younger, representing 24.5% of the total state population.

There is however, slow growth among those in the prime labor force age group (ages 25-59). This group increased by 1.8 million persons during the 1980’s (45% growth) to reach a level of 5.8 million on April 1, 1990. Between 1990 and 2000, this group grew by less than 29% and growth between 2000 and 2010 is expected to be just 17.4%. By 2010, this group is expected to be 45.2% of the total population, down from 46.7% in 2000.

In terms of race, Florida’s population has become increasingly nonwhite over the last two decades. In the 1980 Census, 14.7% of the enumerated population was nonwhite; in 1990, 15.2% was nonwhite, and in 2000 (using the same definitions of race as in previous years) 17.8% was nonwhite. This percentage is projected to increase to 18.9% in 2010.

Florida’s population is also becoming increasingly Hispanic (persons of Hispanic origin may be any race). In 1980, the Census enumerated 858,158 persons of Hispanic origin (8.8% of the total). The number of Hispanics increased to 1,574,143 in 1990 (12.2% of the total) and to 2,682,715 in 2000 (16.8% of total). The Hispanic population increased by 70.4% between 1990 and 2000.

The population estimates and projections presented here represent permanent residents only, as defined by the Census Bureau guidelines of “usual place of residence.” Tourists and seasonal residents are thus excluded. Persons from foreign countries are included regardless of legal status and college students, military personnel, and prison inmates are included as residents where they are living, not where their “hometown” is.

Economic Conditions and Outlook. Florida’s economic growth accelerated in the fiscal year ending June 30, 2004 and it performed moderately better than the United States as a whole. Florida had a strong growth rate, low unemployment rate, and a strong income growth rate this fiscal year. This economic growth could be attributed to favorable natural, economic, and tax environments, and a continually growing population which increases the demand for goods and services.

Florida also has the fastest job growth rate among the ten most populous states. Non-farm employment grew by 1.9% by adding 139,200 jobs in the 2003-04 fiscal year. The job increases occurred most prominently in the professional and business services, construction, educational and health services, leisure and hospitality, financial activities, and government industries. With this strengthening of Florida’s economy, the non-farm employment is expected to have an additional 192,700 jobs in the next fiscal year, resulting in a 6.3% increase in wages and salaries. In addition, the unemployment rate is expected to decline from 4.8% in the 2003-04 fiscal year to 4.6% in the 2004-05 fiscal year. Total personal income in Florida was approximately $541 billion in 2004 or an average of $30,885 per person.

The population growth occurring in Florida has been a major contributing factor to the increase in economic activity, as the greater population has placed increased demands for housing, durable and non-durable goods, and other services. The expected continued population growth will continue to be a driving force behind Florida’s economic expansion.

During 2004, Florida was ravaged by four major hurricanes, which destroyed thousands of homes and businesses. Currently there are massive reconstruction efforts underway to rebuild homes, businesses, and public infrastructure. Housing rates over the past year have shown a tremendous increase due to the low mortgage interest rates. This has resulted in an addition of approximately 230,800 homes. Even though mortgage interest rates are expected to increase in the near future, the surge in construction is projected to continue as Floridians continue to rebuild the areas that were devastated by the hurricanes. Billions of dollars from the federal government, the State, and insurance claims have contributed to the reconstruction. This has resulted in the addition of 21,900 jobs in the construction industry for 2003-04 and it is anticipated that an additional 17,900 jobs will be added in the construction industry for the 2004-05 fiscal year. Residential construction expenditures rose 31.5% in 2003-04 and are expected to increase again in 2004-05.

Florida’s economy has been resilient and continued to grow despite the devastation caused by the hurricanes. In fact, Florida’s economy has been steadily expanding at a greater growth rate than had been previously predicted, which is evidenced by the strength of its labor market and the rise in personal income. Florida’s long-term economic growth is now expected to remain strong because of its strong economic fundamentals.

Florida’s Budget Process

Balanced Budget Requirement. Florida’s constitution requires an annual balanced budget. In addition, the constitution requires a Budget Stabilization Fund equal to 5% of the last fully completed fiscal year’s net revenue collections for the General Revenue Fund.

State Revenue Limitations.On November 8, 1994, the citizens of Florida enacted a Constitutional Amendment on state revenue. This amendment provides that the rate of growth in state revenues is limited to no more than the average annual growth rate in Florida personal income during the past five years. Revenue growth in excess of the limitation is to be deposited into the Budget Stabilization Fund unless two-thirds of the members of both houses of the legislature vote to raise the limit. The revenue limit is determined by multiplying the average annual growth rate in Florida personal income over the past five years times state revenues for the previous year.

Budget Process.Chapter 216, Florida Statutes, promulgates the process used to develop the budget for the State of Florida. By September 1 of each year, the head of each State agency and the Chief Justice of the Supreme Court submit a final annual budget request to the Governor and legislature. Then, at least 45 days before the scheduled annual legislative session in each year, the Governor, as chief budget officer, submits his recommended budget to each legislator.

The Governor also provides estimates of revenues sufficient to fund the recommended appropriations. Estimates for the General Revenue Fund, Budget Stabilization Fund and Working Capital Fund are made by the Revenue Estimating Conference. This group includes members of the executive and legislative branches who have forecasting experience to develop official information regarding anticipated State and local government revenues as needed for the state budgeting process. In addition to the Revenue Estimating Conference, other consensus estimating conferences cover national and state economics, national and state demographics, the state public education system, criminal justice system, social services system, transportation planning and budgeting, the child welfare system, the juvenile justice system and the career education planning process.

Trust fund revenue estimates are generally made by the agency that administers the fund. These estimates are reviewed by the Governor and then incorporated into his recommended budget.

The Governor’s recommended budget forms the basis of the appropriations bill. As amended and approved by the legislature (subject to the line-item veto power of the Governor and override authority of the legislature), this bill becomes the General Appropriations Act.

The Governor and the Cabinet are responsible for detecting conditions which could lead to a deficit in any agency’s funds and reporting such conditions to the Administration Commission and the Chief Justice of the Supreme Court. Article VII, Section 1(d) of the Constitution states, “[p]rovision shall be made by law for raising sufficient revenue to defray the expenses of the State for each fiscal year.”

The legislature is responsible for annually providing direction for the General Appropriations Act regarding the use of the Working Capital Fund to offset General Revenue Fund deficits. Absent any specific direction to the contrary, the Governor and the Chief Justice of the Supreme Court shall comply with guidelines provided in Section 216.221(5), Florida Statutes, for reductions in the approved operating budgets of the executive branch and the judicial branch.

The State of Florida has fully implemented a performance-based budgeting system under Chapter 216, Florida Statutes. With performance-based budgeting, a department receives a lump-sum appropriation from the legislature for each designated program at the beginning of the year. The Governor (for State agencies) and the Chief Justice (for the judicial branch) are responsible for allocating the amounts among the traditional appropriation categories so that specified performance standards can be met. If circumstances warrant, the head of the departmental agency or the Chief Justice may transfer appropriations (other than fixed capital outlay appropriates) but only to the extent of 5% of the original amount of the appropriation or $150,000, whichever is greater. Transfers of general revenue appropriations in excess of 5% or $150,000 or for fixed capital outlays may be approved by the Governor or the Legislative Budget Commission or the Chief Justice of the Supreme Court. The Governor and the Chief Justice may approve transfers of expenditure authority within any trust fund for agencies and the judicial branch, respectively, if the transfers are less than $1 million. The Legislative Budget Com-mission may approve trust fund transfers in excess of $1 million. At the end of any fiscal year, any balance of an operating appropriation which has not been disbursed but is expended or contracted to be expended may be certified forward into the next fiscal year.

Line Item Veto. Florida’s Constitution grants the Governor the power to veto any specific appropriation in a General Appropriation Bill, but the Governor may not veto any qualification or restriction without also vetoing the appropriation to which it relates. A statement identifying the items vetoed and containing his or her objections thereto must be delivered to the appropriate house in which the bill originated, if in session, otherwise to the Secretary of State. The legislature may reconsider and restate the vetoed specific appropriation items by a two-thirds vote of each house.

Revenues. The State accounts for its receipts using fund accounting. It has established the General Funds, as well as four other major funds the Health and Family Services Fund, Public Education Fund, Tax Collection and Administration Fund, and Employment Services Fund. Other non major funds have also been established which include some special interest funds. These funds are maintained for the receipt of monies, which under law or trust agreements must be maintained separately. The General Fund consists of all monies received by the State from every source whatsoever which are not allocable to the other funds and is Florida’s primary operating fund. Florida does not levy a personal income tax or an ad valorem tax on real or tangible personal property. However, taxes remain Florida’s principal source for financing State operations. Major sources of tax revenues for the governmental fund types include the sales and use tax, the documentary stamp tax, the motor fuel tax, and the corporate income tax which were 33.8%, 5.2%, 3.9%, and 2.8% respectively, of the total revenues for fiscal year 2003-04. All revenue from taxes totaled 57% of Florida’s total revenues. Grants and donations after taxes was the next greatest source of revenue providing 34.0% of Florida’s total revenues for that fiscal year. Florida’s Constitution and statutes mandate that the state budget as a whole and each separate fund within the state budget must be kept in balance using currently available revenues for each fiscal year.

Sales and Use Tax. The greatest single source of tax receipts in Florida is the sales and use tax, which amounted to $17.1 billion for fiscal year 2003-04. The sales tax rate is 6% of the sales price of tangible personal property sold at retail in the State. The use tax rate is 6% of the cash price or fair market value of tangible personal property when it is not sold but is used, or stored for use, in the State. In other words, the use tax applies to the use of tangible personal property in Florida, which was purchased in another state but would have been subject to the sales tax if it had been purchased in Florida. Approximately 10% of the sales tax is designated for local governments and is distributed to the respective counties in which it was collected for use by such counties and municipalities therein. In addition to this distribution, local governments may (by referendum) assess a discretionary sales surtax, the rate of which varies by county. Proceeds from this local option sales surtax can be earmarked for funding such things as countywide bus and rapid transit systems, local infrastructure construction and maintenance, medical care for indigents, and capital projects for county school districts as set forth in Section 212.055, Florida Statutes.

The two taxes, sales and use, stand as complements to each other, and taken together provide a uniform tax upon either the sale at retail or the use of all tangible personal property irrespective of where it may have been purchased. The sales tax also includes a levy on the following: (a) rentals of tangible personal property and accommodations in hotels, motels, some apartments, offices, real estate, parking and storage places in parking lots, garages and marinas for motor vehicles or boats; (b) admissions to amusement parks, most sports and recreational events; (c) utilities, except those used in residential homes; and (d) restaurant meals and expendables used in radio and television broadcasting. Some items exempt from the sales and use tax include: food groceries; medicines; hospital rooms and meals; seeds, feeds, fertilizers and farm crop protection materials; purchases made by religious, charitable, and educational nonprofit institutions; professional services; insurance and certain personal service transactions; newspapers; apartments used as permanent dwellings; and kindergarten through community college athletic contests or amateur plays.

Other State Taxes. Other taxes which Florida levies include the motor fuel tax, intangible property tax, documentary stamp tax, corporate income tax, communications service tax, gross-receipts utilities tax, and severance tax on the production of oil and gas and the mining of solid minerals, such as phosphate and sulfur.

Government Debt.Section 11 of Article VII of Florida’s Constitution authorized the State to issue general obligation bonds and revenue bonds to finance or refinance the cost of state fixed capital projects as authorized by law. General obligation bonds are secured by the full faith and credit of the State and are payable from the proceeds of various taxes. Revenue bonds are payable from funds that receive legally restricted revenues. During the past year Florida maintained a high bond rating from Moody’s Investors Service (“Moody’s”) (Aa2), Standard and Poor’s Ratings Services (AA+) and Fitch, Inc. (AA) on all state general obligation bonds. In addition, Moody’s is currently reviewing Florida’s general bond rating for a possible upgrade from the current Aa2.

During the fiscal year ended June 30, 2004 the State took advantage of favorable economic conditions and issued bonds in order to refund previously issued bonds. The refundings of these bonds resulted in lower interest rates and savings in debt service payments over the life of the bonds. The proceeds resulting from the refunding are used to immediately call the refunded bonds. The proceeds of the advance refundings were then deposited into irrevocable trusts and invested in direct obligations of the United States government. These investment funds plus the interest earned thereon will be sufficient to meet the future principal and interest payments on the refunded bonds as they become due.

Numerous government units, counties, cities, school districts and special taxing districts, issue general obligation bonds backed by their taxing power. State and local government units may issue revenue obligations, which are supported by the revenues generated from the particular projects or enterprises. Examples include obligations issued to finance the construction of water and sewer systems, health care facilities and educational facilities. In some cases, sewer or water revenue obligations may be further secured by the full faith and credit of the State.

State revenue bonds may be issued without a vote of the registered voters of the State of Florida to finance or refinance the cost of state fixed capital outlay projects authorized by law, as long as the bonds financing the projects are payable solely from funds derived directly from sources other than State tax revenues. Revenue bonds may be issued to establish a student loan fund, as well as to finance or refinance housing and related facilities so long as repayments come solely from revenues derived from the fund or projects so financed. The Constitution imposes no limit on the principal amount of revenue bonds which may be issued by the state and local governmental agency. Local governmental agencies, such as counties, school boards or municipalities may issue bonds, certificates of indebtedness, or any form of tax anticipation certificate, payable from ad valorem taxes and maturing more than 12 months from the date of issuance only to finance or refinance capital projects authorized by law, and only when approved by a vote of the electors who are property owners living within boundaries of the agency. Generally, ad valorem taxes levied by a local governmental agency may not exceed 10 mils on the value of real estate and tangible personal property unless approved by the electors. Local governmental agencies may issue revenue bonds to finance or refinance the cost of capital projects for airports or port facilities or for industrial or manufacturing plants, without the vote of electors, so long as the revenue bonds are payable solely from revenues derived from the projects.

Florida’s Constitution generally limits state bonds pledging the full faith and credit of the State, to those necessary to finance or refinance the cost of state fixed capital outlay projects authorized by law, and then only upon approval by a vote of the electors. The constitution further limits the total outstanding principal of such bonds to no more than 50% of the total tax revenues of the state for the two preceding fiscal years, excluding any tax revenues held in trust. Exceptions to the requirement for voter approval are: (a) bonds issued for pollution control and abatement and solid waste disposal facilities and other water facilities authorized by general law and operated by state or local governmental agencies; and (b) bonds issued to finance or refinance the cost of acquiring real property or rights thereto for state roads as defined by law, or to finance or refinance the cost of state bridge construction.

The State of Florida 2004 Debt Affordability Report revealed an improvement in the State’s debt ratio of debt service to revenue for net tax-supported debt from 6.12% for the fiscal year ended June 30, 2003 to 5.94% for the fiscal year ended June 30, 2004. This improvement in Florida’s debt ratio is due to the higher than average revenues received during the past year. The benchmark debt ration is expected to remain consistent with the 6% target which has been set by the State throughout the foreseeable future.

The State’s total outstanding debt which is primarily payable from state revenue and secured by the full faith and credit of the state was $21.2 billion at June 30, 2004 which was $817 million more than the end of the previous fiscal year. Approximately $9.5 billion of debt is projected to be issued over the next ten years for all of the State’s financing programs which are currently authorized. This estimate has decreased from previous projections by $1 billion due to the State’s use of cash in lieu of bonding for environmental programs and class size reduction measures in 2005. Annual debt service payments are estimated to grow from the existing $1.5 billion to $2.2 billion by then end of the 2013 fiscal year.

The composition of Florida’s debt for the 2003-04 fiscal year consisted of $12.0 billion (56.5%) for education programs, $5.4 billion (25.5%) for transportation programs, $2.8 billion (13.3%) for environmental programs, and $1.0 billion (4.7%) for all other programs.

While Florida’s total debt continues to rise, the strengthening of Florida’s economy has increased revenue projections and the State’s general fund reserves have increased substantially over the last ten years to indicate that Florida’s financial health has stability and is able to afford the increase in debt. Florida’s general fund reserves have increased from $411 million to $3.5 billion over the last ten years primarily due to the constitutionally mandated budget stabilization fund and higher than expected revenue collections during the past fiscal year.

Other Factors.The performance of the obligations issued by Florida, its municipalities, subdivisions and instrumentalities are in part tied to statewide, regional and local conditions within Florida. Adverse changes to statewide, regional or local economies may adversely affect the creditworthiness of Florida and its political subdivisions. Also, some revenue obligations may be issued to finance construction of capital projects, which are leased to nongovernmental entities. Adverse economic conditions might affect those lessees’ ability to meet their obligations to the respective governmental authority, which in turn might jeopardize the repayment of the principal of, or the interest on, the revenue obligations.

Litigation

Due to its size and broad range of activities, the State is involved in numerous routine legal actions. The ultimate disposition and fiscal consequences of these lawsuits are not presently determinable; however, according to the departments involved, the results of such litigation pending or anticipated will not materially affect the State of Florida’s financial position. The information disclosed in this Litigation Section has been derived from information disclosed in the State of Florida Comprehensive Annual Financial Report for the fiscal year ended June 30, 2004. No assurance can be made that other litigation has not been filed or is not pending which may have a material impact on Florida’s financial position.

A. Riscorp Insurance Company and Riscorp Property & Casualty Insurance Co. v. Florida Department of Financial Services; Florida Hospitality Mutual Insurance Company v. Florida Department of Financial Services

Consolidated Case Nos. 99-5027 and 00-602 Leon County Circuit Court, 2^nd Judicial Circuit. Plaintiffs were seeking declaratory relief and refunds of overpaid Workers’ Compensa-tion Administration and Special Disability Trust Fund assessments for years 1995 through 1998. A Final Judgment was entered on August 15, 2002 in favor of Riscorp in the amount of $22,475,886. A Final Judgment was entered in favor of Florida Hospitality Mutual Insurance Company on July 25, 2002, in the amount of $1,620,869. The Department appealed and on March 16, 2004, the First District Court of Appeal reversed the trial court’s decision for Plaintiff on the issue of ceded reinsurance premiums, affirmed the trial court’s decision awarding refunds for assessments that were paid on brokerage fees and commissions and remanded the case back to the Circuit Court for further proceedings. Florida Department of Financial Services, et al. v. Riscorp Insurance Company, et al. 871 So.2d 261 (1^st DCA 2004). Plaintiffs appealed to the Florida Supreme Court, which denied further review. Riscorp Insurance Company v. Florida Department of Financial Services, 884 So.2d 24 (2004). As a result the Department’s liability amounted to less than $3.6 million in overpaid assessments for brokerage fees and commission. The remaining issues before the Circuit Court were dismissed with prejudice on December 13, 2004.

B. Sarnoff v. Department of Highway Safety and Motor Vehicles

Plaintiff automobile owners brought action against the Department seeking declaratory judgment that Section 325.214(2), Florida Statutes, was unconstitutional as written and implemented by the Department. Section 325.214(2) imposes a $10 fee on emissions inspection of automobiles in seven of Florida’s sixty-seven counties. The Plaintiffs moved for class certification, which was granted by the Circuit Court. The District Court of Appeal reversed the Certification Order. 776 So.2d 976 (1^st DCA 2001). The Supreme Court affirmed the Court’s decision by holding Petitioners should have first sought relief from the Chief Financial Officer pursuant to Section 215.26, Florida Statutes. 825 So. 2d 351 (2002). The Circuit Court then granted Final Summary Judgment for the Defendants. The Plaintiffs appealed this Order to the DCA. The DCA per curium affirmed the lower court on January 18, 2005.

C. Rendon, et al. v. Florida Department of Highway Safety and Motor Vehicles, et al.

Case No. 3D2-611 Third District Court of Appeal. Various handicapped drivers sued challenging the imposition and collection of a fee for placards for handicapped parking spaces. The trial court granted class certification and held that requiring the payment for a fee for a disabled parking permit under Section 320.0848 violates the Americans with Disabilities Act (ADA). The State appealed the decision to the Third DCA and the court reversed the trial court’s decision and remanded with the directions to grant the Department’s cross motion for summary judgment. The court held that sovereign immunity affords the State an absolute defense to claims for declaratory relief and money damages. 832 So.2d 141 (3^rd DCA 2002). Plaintiffs petitioned the Florida Supreme Court seeking jurisdiction and the court denied review. 851 So.2d 729 (2003). The Petitioners then petitioned the US Supreme Court for a writ of certiorari, which was granted. The Court vacated the lower court judgment and remanded the case back to the Florida 3^rd DCA for further consideration in light of Tennessee v. Lane, 541 U.S. 509 (2004). The Attorney General is representing Department. Oral argument was held in the 3^rd DCA on November 22, 2004. Estimated loss to the State could be in excess of $35 million.

Traylor Brothers, Inc. v. Department of Transporation

Case No. 2-856, 17^th Judicial Circuit, Broward County. The Department of Transporta-tion contracted with Traylor Brothers to construct a signature bascule bridge over the Intercoastal Waterway in Fort Lauderdale, Florida. Traylor Brothers has sued the Department for breach of contract alleging, among other things, that the contract documents contained errors, defects, and omissions and failed to disclose the complexity of the project, that the Department failed to properly administer and coordinate the construction activities under the contract, and that there were differing site conditions. The court has denied the Department’s Motion to Dismiss. Outside counsel has been retained to assist the Department. A trial date has been set for Fall 2005. Discovery has been undertaken by both parties and is ongoing. Potential loss to the State could approach $37 million.

E. Smith & Company, Inc., v. Florida Department of Transportation

Case No. H27-CA-2002-938-DM, 5^th Judicial Circuit, Hernando County. This is a suit for breach of contract seeking compensatory damages, return of assessments for late completion, lost future profit allegedly resulting from lost bonding ability, and prejudgment interest on these amounts. The Department filed Motion to Dismiss Plaintiff’s Second Amended Complaint or Portions Thereof on December 3, 2003. On January 21, 2004, this case was dismissed by a stipulated order. The Department subsequently filed suit for liquidated damages in Case No. H27-CA2004-52-DM. Smith & Company filed a counterclaim raising the same issues as the prior case. The potential loss to the State could approach $50 million.

F. ContractPoint Florida Parks, LLC, v. Florida Department of Environmental Protection

Case No. 03-CA-1005, 2^nd Judicial Circuit, Leon County. This is a suit for breach of contract with the Department that would have allowed the Plaintiffs to build, manage, and receive income from cabins in eight State parks for thirty years. Discovery is proceeding. Attempts at mediation have failed. The Department has a pending Motion to Dismiss set for hearing on February 14, 2005. Plaintiff seeks damages of $50 million to $250 million.

G. Marilyn Shumaker Gerkin, as guardian for Helen L. Shumaker, and on behalf of all others similarly situated, v. Jerry Regier, individually and in his official capacity as the Secretary of the Florida Department of Children and Family Services, and Rhonda M. Meadows, individually and in her official capacity as the Secretary of the Agency for Health Care Administration

Case No. 8:03CV2381-T24MAP, United States District Court for the Middle District of Florida. This is a class action suit brought by the daughter and guardian of a Medicaid recipient alleging that the defendants have not allowed the deductions from income required by federal law in determining eligibility for a class of Medicaid recipients. Complaint was served November 21, 2003. Defendants filed a motion to dismiss on December 12, 2003. The motion was granted in part and denied in part on February 20, 2004. The individual defendants were dismissed as were the claims for retroactive damages. On February 26, 2004, the defendants filed a motion to dismiss based on mootness. On February 27, 2004, the court heard the Plaintiffs’ motion for class certification and preliminary injunction. The judge indefinitely continued the motions for class certification and preliminary injunction. The State successfully sought funding to implement policy to correct the issues raised by the Plaintiffs. The court entered an order on August 9, 2004, dismissing the case as moot.

H. Kevin Rabin, Ruth Sinreich and Michael Roberts v. Department of Revenue

The case was initially filed by Citrix Systems, Inc. challenging a notice of proposed tax assessment. Case No. 02-22977-09, Broward County Circuit Court. Subsequently, an amended complaint was filed in which Rabin, Sinreich, and Roberts joined Citrix as Plaintiffs. Plaintiffs asked that a class be certified and asserted that Florida sales and use taxes are facially unconstitutional when attempting to impose tax liabilities on transactions involving communica-tion of information or on businesses and individuals who are recipients of information as an infringement on free speech. Citrix has voluntarily dismissed its action. The Circuit Court granted the Department’s motion to transfer venue to Leon County. The District Court of Appeal affirmed the transfer. Plaintiffs have sought discretionary review of this decision in the Florida Supreme Court. The potential loss to the State could be in excess of $25 million.

I. American Habilitation Services, Inc., et al v. Agency for Health Care Administration and Department of Children and Families

Case No. 04-CA-326, Leon County Circuit Court, 2^nd Judicial Circuit. Twenty-eight providers of services for developmentally disabled Medicaid recipients under the Home and Community Based Waiver seek declaratory judgment and injunctive relief concerning unilaterally imposed rate reductions. Discovery is being conducted. No hearing date has been set. Plaintiffs seek damages in excess of $25 million.

J. Kindred Pharmacy Services East, LLC, et al. v. Agency for Health Care Administration

Case No. 04-CA-1291, Leon County Circuit Court, 2^nd Judicial Circuit. Breach of contract and declaratory judgment action brought by eight pharmacies alleging that the Agency did not properly reimburse providers for prescription drugs provided under the Medicaid program. Plaintiffs seek compensatory damage, declaratory relief, and attorney’s fees. The lawsuit was served on June 2, 2004, and the complaint has been amended twice. The Agency answered the second amended complaint, and both parties are conducting discovery. The estimated exposure of the claim is up to $50 million if an unfavorable outcome is reached.

K. Prado-Steiman v. Bush

Case No. 98-6496-SEITZ, in the United States District Court for the Southern District of Florida, Miami Division. This case challenges the administration of the Developmental Services (DS) Waiver. The case addresses individuals already enrolled on the DS Waiver and individuals waiting for such services. The Second Amended Complaint asserts violations of the Americans with Disabilities Act (ADA), the Rehabilitation Act, the Social Security Act, regulations promulgated pursuant to these statutes, and the Due Process Clause. All claims but ADA and Rehabilitation Act claims are also brought pursuant to 42 U.S.C. § 1983. After Court approval of a settlement agreement, the parties were in compliance phase until April 2003, when a motion asserting material breach was filed. Plaintiffs sought to set aside the settlement agreement and pursue litigation on the merits of their claim. On March 30, 2004, the court issued on Order Denying Plaintiffs’ Motion to Continue Jurisdiction Based on Material Breach of the Settlement Agreement. The order concluded that once the issue of attorney’s fees and costs were resolved, the case should be closed. On October 25, 2004, a Joint Notice was filed with the Court advising the Court that the attorney’s fees and costs had been settled and paid.

L. Collier v. State of Florida

Case No. 03-011264, 17^th Judicial Circuit, Broward County. This is a challenge to Florida’s former practice of releasing driver’s license information to bulk mailers. Until October 2004, this information was public record. The Plaintiffs contend that federal law prohibited the disclosure of such information even though state law required its disclosure. The Plaintiffs ask for class certification and class damages. A motion to dismiss was argued in October 2004, and the court took the matter under advisement. However, there has been no ruling as of January 31, 2005. Plaintiffs seek damages in excess of $25 million.

M. Collier v. Dickinson

Case No. 04-21351-Civ-Graham, U.S. District Court, Southern District of Florida, Miami. This is the federal companion to the above listed case which is pending in state court. The Plaintiffs proceed here under federal causes of action rather than state law claims. They contend that federal Driver Privacy Protection Act overrode state constitutional and statutory law requiring the release of driver information as public record. They seek damages from several state officials and employees involved in managing state driver license information and its release to bulk mailers. A motion to dismiss was filed which the court dismissed without prejudice to refile in April after limited discovery takes place on the defendant’s claim of qualified immunity from damages. Plaintiffs seek damages in excess of $25 million.

ADDITIONAL INFORMATION CONCERNING THE STATE OF NEW JERSEY

The following section provides only a summary of the complex factors affecting the financial situation in the State of New Jersey (as used in this section, the “State”) and is based on publicly available information from the State as of the date of this SAI. The information contained in such publicly available documents has not been independently verified. The information provided below is subject to change without notice, and the inclusion of such information herein shall not under any circumstances create any implication that there has been no change in the affairs of the State since the date hereof.

Economic Factors

New Jersey is the ninth largest state in population and the fifth smallest in land area. According to the United States Bureau of the Census and the Department of Labor, the population of New Jersey was 7.17 million in 1970, 7.37 million in 1980, 7.73 million in 1990 and 8.4 million in 2000. Historically, New Jersey’s average per capita income has been well above the national average, and in 2000 the State ranked third among the states in per capita personal income ($36,983).

The State's economic base is diversified, consisting of a variety of manufacturing, construction and service industries, supplemented by rural areas with selective commercial agriculture. The extensive facilities of the Port Authority of New York and New Jersey, the Delaware River Port Authority and the South Jersey Port Corporation across the Delaware River from Philadelphia augment the air, land and water transportation complex which has influenced much of the State's economy. The State's central location in the northeastern corridor, the transportation and port facilities and proximity to New York City make the State an attractive location for corporate headquarters and international business offices.

The State has indicated it is recording strong, sustained growth from an improving economy. During 2003, New Jersey’s job growth outpaced that of all surrounding states and the nation as a whole. More than 37,000 jobs were created in New Jersey between December 2002 and December 2003. New Jersey’s job growth during this period was the sixth highest in the country.

State Finances

The State operates on a fiscal year beginning July 1 and ending June 30. The estimates for fiscal year 2004 and fiscal year 2005 reflect the amounts contained in the Governor's fiscal year 2004 Budget Message delivered on February 24, 2004.

The General Fund is the fund into which all State revenues not otherwise restricted by statute are deposited and from which appropriations are made. The largest part of the total financial operations of the State are accounted for in the General Fund. Revenues received from taxes, most Federal revenue and certain miscellaneous revenue items are recorded in the General Fund. General Fund and other undesignated fund balances are available for appropriation in succeeding fiscal years.

General Fund beginning balances for fiscal years 2004 and 2005 are projected to be $373.0 million and $400.0 million, respectively. Total undesignated fund balances for fiscal years 2003 and 2004 are projected to be $378.0 million and $402.2 million, respectively.

The State’s four major categories of appropriations are State Operations, Grants-in Aid, State Aid and Debt Service.

State Operations consists of programs and services operated directly by the State government. The largest single component is for the salary and benefits of State employees. The net increase in State Operations expenditures for fiscal year 2005 is projected at $307.3 million.

Grants-in-Aid appropriations are for programs and services provided to the public on behalf of the State by a third party provider, or grants made directly to individuals based on assorted program eligibility criteria. The Medicaid program, the Tuition Assistance Grant Program, Homestead Rebates, payments for State inmates housed in county jails, public transportation aid and funding for State Colleges and Universities fall into this category. The net increase in Grants-in-Aid expenditures for fiscal year 2005 is projected at $906.5 million.

State Aid consists of payments to or on behalf of counties, municipalities, and school districts to assist them in carrying out their local responsibilities. In addition to school aid, this category of expenditure includes the Consolidated Municipal Property Tax Relief program, the Municipal Block Grant program and other forms of municipal aid. It also includes funding for county colleges, local public assistance and county psychiatric hospital costs. The net increase in State Aid expenditures for fiscal year 2005 is projected at $506.8 million.

Debt Service payments represent the interest and principal on capital projects funded through the sale of general obligation bonds. The net increase in Debt Service for fiscal year 2005 is projected at $2.0 million.

Fiscal Year 2004 State Revenue Estimates

The current total fiscal year 2004 revenue estimate of $24.4 billion is $383.9 million more than revenues certified by the Governor in June 2003.

The State’s three largest taxes in terms of receipts--sales and use tax, gross income tax, and corporation business tax--account for over 64% of total State revenues and are forecast to yield $15.7 billion. This is an increase of $372 million over June 2003 certified revenues, reflecting upward revisions in the gross income tax (+$110 million), sales and use tax (+$70 million) and corporate business tax (+$192 million) estimates, due to the economic recovery that started in mid-2003.

Sales and use tax receipts are estimated at $6.2 billion in fiscal year 2004, a 5% rate of growth. The estimate takes into consideration positive reports of 2003 holiday sales and generally robust retail sales of durable goods that were boosted due to attractive financing packages and the low interest environment. Additionally, consumer confidence improved in 2003, increasing close to 13 points between January and December of 2003.

The gross income tax forecast for fiscal year 2004 is $7.2 billion, an increase of $110 million compared to the June 2003 certified revenue estimate. This represents an increase in growth of 7.5% rather than the 5.9% growth anticipated in June 2003. Employer withholdings grew by 5% in calendar year 2003, stronger than the growth of 1.5% in 2002. This was supported by better than expected trends in estimated payments which appear to have stabilized (-0.7%) after falling steeply at double-digit negative growth rates in the past two years. The solid gain in the stock market last year was a major factor contributing to revenue growth, particularly under the gross income tax. New Jersey’s improving income tax collections are also consistent with numerous other economic indicators and trends, including a net gain of 37,100 jobs during calendar year 2003, a state unemployment rate that has been consistently below the national rate over the same period of time, and a second consecutive record year for new business filings in New Jersey.

The corporation business tax (CBT) was previously estimated at $2.1 billion for fiscal year 2004, reflecting a decrease of $414 million from the final fiscal year 2003 receipts. This decline was due to the loss of revenue items that were only available for fiscal year 2003. These items included the acceleration of the September 2003 estimated payments to June 2003 and the 6 month benefit of the retroactive effective date of January 1, 2002. The CBT is revised upward by $192 million to $2.2 billion for fiscal year 2004. The revised estimate represents a decrease of $222 million compared to the $414 million that was previously anticipated. The revised estimate is in line with increasing corporate profits and the recovering economy in 2004. The CBT estimates assume decoupling from the enhanced federal expensing law (IRS code section 179).

Fiscal Year 2005 State Revenue Estimates

Total revenues for fiscal year 2005 are expected to be $26.3 billion, approximately $1.9 billion (7.7%) above the revised fiscal year 2004 anticipation, and include new revenue actions of $2.6 billion.

In fiscal year 2005, sales and use, sales and use, and corporation business taxes account for 64% of total revenues and are expected to yield $16.8 billion.

The fiscal year 2005 sales and use tax revenues forecast of $6.6 billion is an increase of $340 million, or 5.5%, compared to the revised fiscal year 2004 revenues. This reflects an expectation of continued improvement in the underlying economic fundamentals during fiscal year 2005. The favorable low-interest and low-inflationary environment along with improving labor market conditions are expected to support growing consumer confidence and spending in 2004.

The fiscal year 2005 gross income tax forecast of $7.8 billion is an increase of $603 million, or 8.3%, over fiscal year 2004. This is a reflection of the economic turnaround that started in 2003. New Jersey total income, which is the tax base, is expected to increase by 2.8% in 2003 after two straight years of negative income growth. In 2004 and 2005, the tax base is projected to grow at 5.1% and 5.3%, respectively. The amount of income on tax returns reporting over $100,000 in total income is expected to rebound at an 8.9% average annual rate (2004-2005) after declining at –2% average annual rate during the 2001- 2003 recession. Although this pace of growth appears impressive, it remains well below the record double-digit average annual growth rate of 18% experienced from 1995 to 2000.

The fiscal year 2005 CBT revenue forecast of $2.4 billion represents an increase of $145 million (or 6.5%), compared with fiscal year 2004. This upward revision assumes an underlying base growth of 5% in gross payments and refund growth of 15.1% in fiscal year 2005. It also includes the continuation of the net operating loss suspension estimated at $275 million.

General Considerations

Estimated receipts from State taxes and revenues, including the three principal taxes set forth above, are forecasts based on the best information available at the time of such forecasts. Changes in economic activity in the State and the nation, consumption of durable goods, corporate financial performance and other factors that are difficult to predict may result in actual collections being more or less than forecasted.

Should revenues be less than the amount anticipated in the budget for a fiscal year, the Governor may, pursuant to statutory authority, prevent any expenditure under any appropriation. There are additional means by which the Governor may ensure that the State is operated efficiently and does not incur a deficit. No supplemental appropriation may be enacted after adoption of an appropriations act except where there are sufficient revenues on hand or anticipated, as certified by the Governor, to meet such appropriation. In the past when actual revenues have been less than the amount anticipated in the budget, the Governor has exercised his plenary powers leading to, among other actions, implementation of a hiring freeze for all State departments and the discontinuation of programs for which appropriations were budgeted but not yet spent. Under the State Constitution, no general appropriations law or other law appropriating money for any State purpose may be enacted if the amount of money appropriated therein, together with all other prior appropriations made for the same fiscal year, exceeds the total amount of revenue on hand and anticipated to be available for such fiscal year, as certified by the Governor.

ADDITIONAL INFORMATION CONCERNING NEW YORK

The following section provides only a summary of the complex factors affecting the financial situation in New York State (as used in this section, the “State”) and is based on publicly available information from the State as of the date of this SAI. The information contained in such publicly available documents has not been independently verified. The information provided below is subject to change without notice, and the inclusion of such information herein shall not under any circumstances create any implication that there has been no change in the affairs of the State since the date hereof.

Special Considerations Relating to New York Municipal Securities

New York State is the third most populous state in the nation and has a relatively high level of personal wealth. The State’s economy is diverse, with a comparatively large share of the nation’s financial activities, information, education, and health services employment, and a very small share of the nation’s farming and mining activity. The State’s location and its air transport facilities and natural harbors have made it an important link in international commerce. Travel and tourism constitute an important part of the economy. Like the rest of the nation, New York has a declining proportion of its workforce engaged in manufacturing, and an increasing proportion engaged in service industries.

Recent above-trend national growth rates have helped to buttress the New York State economy. The State is estimated to have emerged from recession in the summer of 2003. The New York City economy is on its way to a full recovery from the impact of the September 11^th attack, reversing several years where the City’s job base was in decline. The continued strengthening of the State economy is expected to help to sustain the housing market, although not at the fast pace of growth observed in 2004. Moreover, with the pickup in equity market activity toward the end of 2004, the profit outlook for the finance industry is brightening, though the level of profits for the year is not expected to match that of 2003. Bonus growth is expected to slow to 15 percent resulting in total New York wage growth of 4.9 percent for 2005, reduced modestly from 5.7 percent in 2004. State nonagricultural employment is projected to rise 1.1 percent in 2005, a significant improvement compared with 0.4 percent growth for 2004, but below projected growth of 1.8 percent for the nation.

The Division of Budget (DOB) projected that balances at the close of 2004-05 in the State’s general reserves to guard against unbudgeted risks would total $1.5 billion. The reserves include $872 million in the Tax Stabilization Reserve Fund, $601 million in a new fiscal stability reserve fund, and $21 million in the Contingency Reserve Fund for litigation. Aside from the $21 million in the Contingency Reserve Fund, the current Financial Plan does not set aside specific reserves to cover potential costs that could materialize as a result of adverse rulings in pending litigation, Federal disallowances, or other Federal actions that could adversely affect the State's projections of receipts and disbursements.

The Federal government is currently auditing Medicaid claims submitted since 1993 under the School Supportive Health Services Program. At this point, these audits have not been finalized, and, as a result, the liability of the State and school districts for any disallowances cannot be determined. Federal regulations include an appeals process that could postpone repayment of any disallowances. The current Financial Plan assumes the Federal government will fully reimburse these costs.

In addition, a portion of Federal Medicaid payments related to School Supportive Health Services have been deferred by the Federal Centers for Medicare and Medicaid Services pending finalization of audits. Since the State has continued to reimburse local school districts for these costs, these Federal deferrals, if not resolved, could negatively impact the Financial Plan. Alternatively, if the State suspends reimbursement, local governments could be adversely affected.

GAAP-Basis Financial Plan

DOB prepares the General Fund and All Governmental Funds Financial Plans in accordance with Generally Accepted Accounting Principles (GAAP). The GAAP results for 2003-04 and the projections for 2004-05 are based on the accounting principles applied by the State Comptroller in the financial statements issued for the 2003-04 State fiscal year, and reflect the impact of Governmental Accounting Standards Board Statements, Statement Number 34, “Basic Financial Statements—Management’s Discussion and Analysis (MD&A)—for State and Local Governments” (“GASB 34”). The changes are intended to portray the State’s net overall financial condition, including activities that affect State assets and liabilities during the fiscal year.

The General Fund GAAP Financial Plan for 2004-05 shows total revenues of $38.4 billion, total expenditures of $45.7 billion, and net other financing sources of $8.2 billion, resulting in an operating surplus of $970 million and a projected accumulated surplus of $689 million. This operating result reflects higher revenues offset by the use of the 2003-04 surplus and the remaining tobacco resources in 2004-05.

The General Fund GAAP Financial Plan for 2005-06 shows total revenues of $38.4 billion, total expenditures of $48.1 billion, and net other financing sources of $9.4 billion, resulting in an operating deficit of $394 million and a projected accumulated surplus of $295 million. These changes are due primarily to the use of 2004-05 resources in 2005-06 partially offset by $601 million in the Fiscal Stability Reserve.

The accumulated surplus of $295 million at the end of 2005-06 is an improvement of $576 million from the 2003-04 actual results, primarily reflecting the multi-year increase in reserves.

GAAP-Basis Results for Fiscal Year 2003-04

The Comptroller prepares general purpose financial statements on a GAAP basis for governments as promulgated by the Governmental Accounting Standards Board. The statements, released in July each year, contain a Combined Balance Sheet and Combined Statement of Revenues, Expenditures and Changes in Fund Balances. These statements are audited by independent certified public accountants. The Comptroller also prepares and issues a Comprehensive Annual Financial Report, which includes a financial overview, the general purpose financial statements, individual fund combining statements, and a statistical section.

Both the Basic Financial Statements and Comprehensive Annual Financial Reports for prior fiscal years can be obtained from the Office of the State Comptroller, 110 State Street, Albany, NY 12236 or at the OSC website at www.osc.state.ny.us.

The State’s general purposes financial statements for fiscal year 2003-04 prepared on a GAAP basis reflect the following.

Net Assets. The State reported net assets of $41.2 billion, which was comprised of $60.5 billion in capital assets reported net of related debt, $4.3 billion in restricted net assets offset by an unrestricted net assets deficit of $23.6 billion. Net assets reported for governmental activities decreased by $3.3 billion from 2002-03, decreasing from $42.4 billion to $39.1 billion,a decrease of $3.3 billion from the 2002-03. At March 31, 2004 there was a $24.0 billion deficit in unrestricted net assets, which is that part of net assets that can be used to finance day-to-day operations without constraints established by debt covenants, enabling legislation, or other legal requirements.

The deficit in unrestricted governmental net assets arose primarily because of the issuance of debt for purposes not resulting in a capital asset related to governmental activities. Such outstanding debt included securitizing the State’s future tobacco settlement receipts ($4.8 billion) and bonding for local aid payments for school education aid that were financed on a long-term basis by the Local Government Assistance Corporation ($4.6 billion), local highway and bridge projects ($2.7 billion), local mass transit projects ($2.4 billion), and a wide variety of grants and other expenditures not resulting in governmental capital assets ($6.5 billion). This deficit in unrestricted net assets of governmental activities can be expected to continue for as long as the State continues to have obligations outstanding for purposes other than the acquisition of governmental capital assets.

Net assets for business-type activities decreased by 16.5%, $2.1 billion in 2003-04 compared to $2.5 billion in 2003. The decrease in net assets for business-type activities was caused primarily by unemployment benefit payments exceeding employer contributions and other revenues for the Unemployment Insurance Fund ($287 million) and CUNY Senior College operating expenses exceeding operating revenues and State support ($143 million). As of June 30, 2003, $8.0 billion in debt had been issued and was outstanding to finance capital assets of the State’s colleges and universities.

Governmental Activities. The State’s total expenses for governmental activities of $94.6 billion exceeded its total revenues of $92.5 billion by $2.1 billion. However, the amount that taxpayers ultimately financed for activities through State taxes and other State revenue was $48.0 billion, education aid transfers from the State Lottery was $1.9 billion, grants and contributions was $37.5 billion, and revenues derived by those who directly benefited from the programs was $7.0 billion. Overall, the State’s governmental program revenues, including intergovernmental aid, fees for services and capital grants were $44.5 billion in 2003-04. The State paid for the remaining “public benefit” portion of governmental activities with $43.7 billion in taxes and $4.3 billion in other revenues including investment earnings.

Business-type Activities. The cost of all business-type activities in 2003-04 was $15.6 billion. The amount that tax-payers ultimately financed for activities reported as transfers was $797 million because some activity costs were paid by those directly benefiting from the programs ($8.4 billion), grants and contributions ($5.6 billion) and other miscellaneous revenue ($342 million).

State Funds. The State uses fund accounting to ensure and demonstrate compliance with legal and finance related requirements. As the State completed the year, its governmental funds reported a combined fund balance of $6.2 billion. Included in this year’s total change in fund balance is an operating surplus of $3.0 billion in the State’s General Fund. The General Fund operating surplus is attributable to several factors including the sale of tobacco bonds which provided resources of $4.2 billion, an increase of $1.3 billion in personal income tax revenue, a $1.0 billion increase in consumption and use tax revenue, a $645 million increase in Federal grants and a $504 million increase in miscellaneous revenues, offset by a $206 million decline in business and other taxes. Much of the increase in tax revenues is related to improvement in the national economy and tax increases enacted for personal income and sales taxes. The improvement in the national economy favorably affected the State’s economy in the form of job growth and increased spending by business. The increase in General Fund revenues was offset by a $2.5 billion increase in expenditures. Local assistance expenditures increased by $2.2 billion due primarily to increased spending for medical assistance and income maintenance programs. State operations increased $300 million due primarily to increased employer pension costs.

The State ended the 2003-04 fiscal year with a General Fund accumulated deficit of $281 million on a GAAP basis. The reduction of the accumulated deficit versus the accumulated deficit at the end of 2002-03 primarily reflects the restoration of reserves as a result of the improving State economy and the sale of tobacco bonds from which the General Fund received a $4.2 billion benefit.

Capital Assets. As of the end of the 2003-04 fiscal year, the State had $82.9 billion invested in a broad range of capital assets, including equipment, buildings, construction in progress, land preparation, and infrastructure which includes such things as roads and bridges. This amount represents a net increase (including additions and deductions) of $920 million over last year.

The State is responsible for maintaining more than 42,466 lane miles of highway and 7,798 bridges. Capital spending for highway and bridge maintenance and preservation projects was approximately $1.1 billion in 2004. The State’s fiscal year 2005 capital budget calls for it to spend another $6.7 billion for capital projects, of which $3.5 billion is for transportation projects. To pay for these capital projects the State plans to use $207 million in general obligation bond proceeds, $3.5 billion in other financing arrangements with public authorities, $1.8 billion in Federal funds, and $1.1 billion in funds on hand or received during the year.

Debt Administration. The State has obtained long-term financing in the form of voter-approved General Obligation debt (voter approved debt) and other obligations for which voter approval is not needed and has not otherwise been sought (non-voter approved debt). Non-voter approved long-term financing at March 31, 2004 includes debt obligations the State pays pursuant to contractual obligations it entered into with the issuer. Such obligations include certain bonds issued through state public authorities, certificates of participation, and capital leases obtained through vendors. The State administers its long-term financing needs as a single portfolio of state-supported debt that includes general obligation bonds and other obligations of both its governmental activities and business-type activities. Most of the debt reported under business-type activities, all of which was issued for capital assets used in those activities, is supported by payments from resources generated by the State’s Governmental Activities—thus it is not expected to be repaid from resources generated by business-type activities. The State Finance Law allows the bonded portion of this single combined debt portfolio, which includes debt reported in both governmental and business-type activities combined, to include debt instruments which result in a variable rate exposure in an amount that does not exceed 15% of total outstanding State-supported debt, and interest rate exchange agreements (swaps) that do not exceed 15% of total outstanding State-supported debt. At March 31, 2004 the State had $1.9 billion in State-supported variable rate bonds outstanding and $5.5 billion in variable rate bonds outstanding that are subject to swap agreements resulting in effective fixed rates, subject to certain risks. In addition, the State had $2.4 billion in convertible bonds that, at various dates in the future, can remain in a fixed rate mode, at new fixed rates to be established at future mandatory tender dates, or convert to a variable rate. At March 31, 2004, variable rate bonds, net of those subject to the fixed rate swaps, were equal to 4.7% of the State-supported bonded debt portfolio. Total swap agreements of $5.5 billion were equal to 13.5% of the total bonded portfolio.

At March 31, 2004the State had $46.9 billion in bonds, notes, and other financing agreements outstanding compared with $39.3 billion last year, an increase of $7.6 billion.

Cash Basis Results for Fiscal Year 2004-05

DOB reported a 2004-05 General Fund surplus of $1.2 billion. Total receipts, including transfers from other funds, were $43.8 billion. Disbursements, including transfers to other funds, totaled $43.6 billion.

The General Fund ended the 2004-05 fiscal year with a balance of $1.2 billion, which included dedicated balances of $872 million in the Tax Stabilization Reserve Fund (after a $78 million deposit at the close of 2004-05), the Contingency Reserve Fund ($21 million), and the Community Projects Fund ($325 million). The closing fund balance excludes $1.3 billion on deposit in the refund reserve account at the end of the 2004-05 fiscal year, including $601 million in the new fiscal stability reserve fund.

General Fund receipts, including transfers from other funds, totaled $43.8 billion in 2004-05, an increase of $1.4 billion from 2003-04 results. Tax receipts, excluding the impact of the tax refund reserve transaction, increased by nearly $4 billion on an annual basis. The growth was offset by an annual decline of $3.5 billion in miscellaneous receipts, due mainly to the State's securitization of tobacco settlement payments in 2003-04.

General Fund spending, including transfers to other funds, totaled $43.6 billion in 2004-05, an increase of $1.6 billion from 2003-04. Medicaid, school aid, fringe benefits, and debt service were the main sources on annual growth.

2005-2006 Enacted Budget Financial Plan

The State’s current fiscal year began on April 1, 2005 and ends on March 31, 2006. On March 8, 2005, the State Legislature enacted appropriations for all State-supported, contingent contractual, and certain other debt service obligations for the entire 2005-06 fiscal year. On March 31, 2005, the Legislature completed action on the remaining appropriations and accompanying legislation constituting the budget for the 2005-06 fiscal year. Subsequently, on April 12, 2005, the Legislature enacted certain amendments to the 2005-06 Enacted Budget.

Receipts.The State projects General Fund receipts, including transfers from other funds, to total $46.8 billion in 2005-06, an increase of $3.0 billion (6.9 percent) from the current year. Projected growth in personal income and sales taxes, resulting from temporary tax actions taken in the 2004-05 Enacted Budget and the economic recovery, are primarily responsible for the growth.

General Fund personal income tax receipts are projected to increase by $2.4 billion (13.1 percent) from 2004-05. The increase is due to continued economic improvement in 2005 (stronger withholding and estimated tax payments), strong payments on 2004 tax liability (higher final returns and extensions offset slightly by an increase in refunds) and a smaller deposit into the personal income tax refund reserve account. This amount is offset by a larger deposit to the Revenue Bond Tax Fund.

General Fund user taxes and fees receipts for 2005-06 are projected to total $8.6 billion, a decrease of $130 million (1.5 percent) from reported 2004-05 collections. The projected decline in sales tax cash receipts of $125 million (15 percent) is largely attributable to the sunset of the temporary increase in the overall tax rate from 4.25 percent to 4 percent effective June 1, 2005. Growth in the sales tax base, after adjusting for tax law changes and other factors, is projected at 6.0 percent. The decline in General Fund cigarette tax receipts of $5 million from the prior year is the result of a continuation of the long-term consumption decline in cigarettes.

General Fund business tax receipts in 2005-06 are projected to total $4.3 billion, an increase of $214 million (5.3 percent) from 2004-05 collections. This increase is primarily due to an expectation of continued strength in the corporate franchise tax.

The estimate for General Fund other taxes in 2005-06 is $778 million, which is $148 million below 2004-05.

General Fund miscellaneous receipts are projected to total $2.3 billion in 2005-06, an increase of $131 million from the current fiscal year. This increase is primarily due to the receipt of $523 million from the local government revenue and disbursement program partially offset by the loss of several one-time receipts received in 2004-05.

Transfers to the General Fund from personal income tax receipts deposited to the Revenue Bond Tax Fund in excess of debt service payable on State Personal Income Tax Bonds are projected to total $6.3 billion in 2005-06, an increase of $357 million from 2004-05. The annual increase is attributable to overall growth in personal income tax receipts ($519 million), partially offset by an increase in debt service costs on personal income tax bonds ($162 million). Transfers to the General Fund of sales tax receipts deposited to the Local Government Assistance Corporation (“LGAC”) fund in excess of debt service due on LGAC bonds are projected to total $2.3 billion in 2005-06, an increase of $124 million from 2004-05. This growth is due to overall growth in sales tax receipts ($149 million), partially offset by a modest increase in debt service costs ($25 million).

Transfers to the General Fund from the real estate transfer tax deposited to the Clean Water/Clean Air Debt Service Fund in excess of debt service due on those general obligation bonds are projected to total $510 million in 2005-06. The decrease of $6 million is due to growth in real estate transfer taxes ($9 million) more than offset by an increase in debt service costs ($15 million).

All other transfers are projected to total $513 million in 2005-06, an annual increase of $61 million primarily due to the timing of deposits to Tribal State Compact Revenue account ($103 million) and a net increase in fund sweeps ($109 million), offset by nonrecurring transfers from SUNY and CUNY to reimburse the General Fund for equipment costs ($151 million).

All Funds receipts are projected to total $106.5 billion in 2005-06, an increase of $4.5 billion (4.4 percent) over 2004-05.

Disbursements. The State projects General Fund disbursements, including transfers to other funds, of $46.2 billion in 2005-06, an increase of $2.1 billion (4.7 percent) from 2004-2005. Increases in Grants to Local Governments ($1.4 billion), State Operations ($502 million), and General State Charges ($396 million), offset by a decrease in transfers to other funds ($265 million) account for the change.

Local assistance spending is projected at $31.4 billion in 2005-06, an increase of $1.4 billion (4.8 percent) from the current year. Growth in school aid ($864 million) and CUNY operating costs (mainly for salary growth and increases in fixed costs) and CUNY/SUNY community college enrollment growth ($179 million) are partially offset by savings from Medicaid cost containment and a patient income revenue reclassification described in the next paragraph.

State Operations spending is projected to total $8.1 billion in 2005-06, an increase of $502 million (6.6 percent) from the prior year. The projected annual increase in State Operations is affected by the use of $400 million in patient income revenues in 2005-06 to offset local assistance spending, instead of offsetting State Operations spending as was done in 2004-05. The change results in a $400 million annual increase in State operations costs financed by the General Fund and a comparable decrease in local assistance spending. Adjusting for this reclassification, State Operations is projected to increase by $102 million from 2004- 05. The growth is comprised of scheduled wage increases under current labor contracts, normal salary creep, and salary grade changes (roughly $350 million) offset by savings in agency operations.

DOB projects the Executive branch workforce will total 191,891 in 2005-06, an increase of 2,245 over the 2004-05.

General Fund spending for General State Charges is projected to be $4.0 billion in 2005-06, an increase of $396 million (10.8 percent) over the prior year. The annual increase is due mostly to rising costs of employee health benefits ($189 million), higher costs related to employer pension contributions ($247 million) and fringe benefit increases for unsettled collective bargaining agreements (roughly $40 million). Higher fringe benefit cost reimbursements to the General Fund which are payable from other funds, thus reducing General Fund costs, partially offset the growth ($105 million).

Transfers to other funds are projected to total $2.6 billion in 2005-06 and include General Fund transfers to support debt service ($1.7 billion), capital projects ($229 million), and other funds ($747 million).

General Fund transfers for debt service decline by $64 million (3.7 percent) from 2004-05 primarily due to $150 million in projected savings from debt management actions, offset by higher debt service on existing bonds for corrections and CUNY, and the accounting treatment of the Personal Income Tax Revenue Bond program which reduces General Fund costs and increases costs in State Funds.

Transfers to support capital projects increase by $32 million mainly from a reestimate of the timing of capital spending based on 2004-05 actuals.

All other transfers are projected to decrease by $233 million in 2005-06 due primarily to a nonrecurring transfer to the Health Care Reform Act Special Revenue Fund to reflect a prepayment of General Fund support originally planned in 2005-06 but paid in 2004-05 ($200 million).

Authorities and Localities

Metropolitan Transportation Authority (“MTA”). The official financial disclosure of the MTA and its subsidiaries is available by contacting the Metropolitan Transportation Authority, Finance Department, 347 Madison Avenue, 6th Floor, New York, New York 10017 or by visiting the MTA website at www.mta.info.

New York City.The fiscal demands on the State may be affected by the fiscal condition of the City, which relies in part on State aid to balance its budget and meet its cash requirements. It is also possible that the State’s finances may be affected by the ability of the City, and certain entities issuing debt for the benefit of the City, to market securities successfully in the public credit markets. The official financial disclosure of The City of New York and the financing entities issuing debt on its behalf is available by contacting Raymond J. Orlando, Director of Investor Relations, (212) 788-5875 or contacting the Office of Management and Budget, 75 Park Place, 6th Floor, New York, NY 10007.

Fiscal Oversight for New York City. In response to the City’s fiscal crisis in 1975, the State took action to help the City return to fiscal stability. These actions included the establishment of the Municipal Assistance Corporation for the City of New York (NYC MAC), to provide the City with financing assistance; the New York State Financial Control Board (FCB), to oversee the City’s financial affairs; and the Office of the State Deputy Comptroller for the City of New York (OSDC), to assist the Control Board in exercising its powers and responsibilities. A “control period” existed from 1975 to 1986, during which the City was subject to certain statutorily prescribed fiscal controls. The FCB terminated the control period in 1986 when certain statutory conditions were met. State law requires the FCB to reimpose a control period upon the occurrence or “substantial likelihood and imminence” of the occurrence, of certain events, including (but not limited to) a City operating budget deficit of more than $100 million or impaired access to the public credit markets.

The staffs of the FCB, OSDC, the City Comptroller and the Independent Budget Office, issue periodic reports on the City's financial plans. Copies of the most recent reports are available by contacting: FCB, 123 William Street, 23rd Floor, New York, NY 10038, Attention: Executive Director; OSDC, 59 Maiden Lane, 29th Floor, New York, NY 10038, Attention: Deputy Comptroller; City Comptroller, Municipal Building, 6th Floor, One Centre Street, New York, NY 10007-2341, Attention: Deputy Comptroller for Budget; and IBO, 110 William Street, 14th Floor, New York, NY 10038, Attention: Director.

Other Localities.Certain localities outside New York City have experienced financial problems and have requested and received additional State assistance during the last several State fiscal years. The potential impact on the State of any future requests by localities for additional oversight or financial assistance is not included in the projections of the State's receipts and disbursements for the State's 2005-06 fiscal year or thereafter.

Litigation

New York is currently involved in certain litigation where adverse decisions could have a material impact on State finances. Included in this litigation are the following:

In Campaign for Fiscal Equity, Inc., et al. v. State, et al.,plaintiffs claimed that the State’s method of determining funding levels for New York City public schools has a disparate impact on plaintiffs in violation of Title VI of the Civil Rights Act of 1964 and does not provide a “sound basic education” as required by the State Constitution. By a decision dated June 26, 2003, the New York State Court of Appeals held that the evidence supported the trial court’s conclusion that New York City schoolchildren were not receiving the constitutionally mandated opportunity for a sound basic education, and remitted the case to the trial court for further proceedings in accordance with its decision. In August 2004, the Supreme Court, New York County, referred this case to a panel of three referees to make recommendations as to how the State should satisfy the Court of Appeals holding. On November 30, 2004, the panel recommended that that the State pay New York City Schools a total of $14.08 billion over the next four years in additional operations funding and $9.17 billion over the next five years for capital improvements. On March 15, 2005, the Supreme Court, New York County, issued an order confirming the panel's report and recommendations and directing the State to take all steps necessary to provide additional funding for New York City schools in the amounts of $1.41 billion in 2005-06, $2.82 billion in 2006-07, $4.22 billion in 2007-08 and $5.63 billion in 2008-09, totaling $14.08 billion over the next four years. The Court also directed the State to take all steps necessary to provide additional capital funding in the amount of $1.836 billion annually totaling $9.179 billion over the next five years. The State has appealed from the March 15, 2005 order to the Appellate Division, First Department and the trial court's decision was stayed pending resolution of the appeal. On May 3, 2005, the First Department denied the plaintiffs' motion to lift the automatic stay.

In Oneida Indian Nation of New York et al. v. County of Oneida, plaintiff claimed that a 250,000 acre area in Madison and Oneida counties was illegally sold to the State in 1795. On December 7, 2004, settlement agreements were signed between the State, the Oneidas of Wisconsin and the Stockbridge-Munsee Tribe, which would in part require the passage of State and Federal legislation to become effective. Such legislation must be enacted by September 1, 2005 unless the parties agree to an extension of time. The agreements contemplate the extinguishment of all Oneida and other Indian claims in the tract at issue in this litigation. Although the agreements provide for monetary payment, transfers of lands and other consideration to non-signatory tribal plaintiffs, these agreements have not been signed by the United States, the Oneidas of New York, the Oneida of the Thames Band or the New York Brothertown. On April 15, 2005, the Governor withdrew legislation that he had proposed to approve this and other Indian land claim and settlement agreements.

In Canadian St. Regis Band of Mohawk Indians, et al., v. State of New York, et al.,plaintiffs seek ejectment and monetary damages with respect to their claim that approximately 15,000 acres in Franklin and St. Lawrence Counties were illegally transferred from their predecessors-in-interest. On November 29, 2004, the plaintiff tribal entities, with one exception, approved a settlement proposed by the State, which would require enactment of State and Federal legislation to become effective. On April 15, 2005, the Governor withdrew legislation that he had proposed to approve this and other Indian land claim and settlement agreements.

In Cayuga Indian Nation of New York v. Cuomo et al. the federal District Court, in February 2000, granted plaintiffs $211 million in prejudgment interest on 64,000 acres held to be illegally sold to the State in 1795. The State appealed from the judgment to the United States Court of Appeals for the Second Circuit. In November 2004, settlements were signed on by the State with the Chief of the Seneca-Cayuga Tribe of Oklahoma and Cayuga Indian Nation of New York which would, in part, require enactment of State and Federal legislation to become effective. Such legislation must be enacted by September 1, 2005 unless the parties agree to an extension of time. These agreements provide for differential payments to be made to the plaintiff tribes, based upon the outcome of the appeal now pending in the Second Circuit. On April 15, 2005, the Governor withdrew legislation that he had proposed to approve this and other Indian land claim and settlement agreements.

In Freedom Holdings Inc. et al. v. Spitzer et ano., two cigarette importers brought an action in 2002 challenging portions of laws enacted by the State under the 1998 Tobacco Master Settlement Agreement (“MSA”) that New York and many other states entered into with the major tobacco manufacturers. The initial complaint alleged: (1) violations of the Commerce Clause of the United States Constitution; (2) the establishment of an “output cartel” in conflict with the Sherman Act; and (3) selective nonenforcement of the laws on Native American reservations in violation of the Equal Protection Clause of the United States Constitution. The United States District Court for the Southern District of New York granted defendants’ motion to dismiss the complaint for failure to state a cause of action. Plaintiffs appealed from this dismissal. In an opinion decided January 6, 2004, the United States Court of Appeals for the Second Circuit (1) affirmed the dismissal of the Commerce Clause claim; (2) reversed the dismissal of the Sherman Act claim; and (3) remanded the selective enforcement claim to the District Court for further proceedings. Plaintiffs have filed an amended complaint that also challenges the MSA itself (as well as other related State statutes) primarily on preemption grounds. On September 14, 2004, the District Court denied all aspects of plaintiffs' motion for a preliminary injunction, except that portion of the ability of tobacco manufacturers to obtain the release of certain funds from escrow. Plaintiffs appealed from the denial of the remainder of the motion to the United States Court of Appeals for the Second Circuit. On May 18, 2005, the Court of Appeals for the Second Circuit affirmed the District Court’s denial of a preliminary injunction.

In Consumers Union of U.S., Inc. v. State, plaintiffs challenge the constitutionality of statutes relating to the authorization of the conversion of Empire Health Choice, d/b/a Empire Blue Cross and Blue Shield from a not-for-profit corporation to a for-profit corporation. The law requires, in part, that upon such conversion, assets representing 95 percent of the fair market value of the not-for-profit corporation be transferred to a fund designated as the “public asset fund” to be used for the purpose set forth in the Insurance Law. The State and private defendants have separately moved to dismiss the complaint. On November 6, 2002, the Supreme Court, New York County, granted a temporary restraining order, directing that the proceeds from the initial public offering of the for-profit corporation be deposited with the State Comptroller in an interest-bearing account, pending the hearing of a motion for a preliminary injunction, which was returnable simultaneously with the motions to dismiss, on November 26, 2002. By decision and order dated May 20, 2004, the Appellate Division, First Department affirmed the dismissal of plaintiff's original complaint but also affirmed the denial of defendants' motion to dismiss the amended claim. The State, the other defendants and the plaintiffs have been granted leave to appeal to the Court of Appeals.

ADDITIONAL INFORMATION CONCERNING PENNSYLVANIA

The financial condition of the Commonwealth of Pennsylvania (the “Commonwealth”), its public authorities and its local governments could affect the market values and marketability of, and therefore the net asset value per share and the interest income of the Pennsylvania Municipal Money Market Fund, or result in the default of existing obligations, including obligations which may be held by the Fund. The following section provides only a brief summary of the complex factors that may affect the financial situation in the Commonwealth and is based on information obtained from the Commonwealth, certain of its public authorities and certain other localities within the Commonwealth as publicly available on the date of this SAI. The information contained in such publicly available documents has not been independently verified. It should be noted that the creditworthiness of obligations issued by local issuers might be unrelated to the creditworthiness of the Commonwealth. There is no obligation on the part of the Comonwealth to make payment on such local obligations in the event of default in the absence of a specific guarantee or pledge provided by the Commonwealth.

General

The Commonwealth of Pennsylvania, the sixth most populous state, historically has been identified as a heavy industry state, although that reputation has changed with the decline of the coal, steel and railroad industries and the resulting diversification of the Commonwealth's industrial composition. The major new sources of growth are in the service sector, including trade, medical and health services, educational and financial institutions. Manufacturing has fallen behind both the service sector and the trade sector as a source of employment in the Commonwealth. The Commonwealth is the headquarters for many major corporations. The Commonwealth’s average annual unemployment rate for each year since 1986 has generally not been more than one percent greater or lesser than the nation’s annual average unemployment rate. The seasonally adjusted unemployment rate for the Commonwealth for March 2005 was 5.4% and for the United States for March 2005 was 5.2%. The population of the Commonwealth, 12.4 million people in 2004 according to the U.S. Bureau of the Census, represents a population growing slower than the United States with a higher portion than the United States comprised of persons age 45 or over. Per capita income in the Commonwealth for 2004 of $33,348 was higher than the per capita income of the United States of $32,937. The Commonwealth's General Fund, which receives all tax receipts and most other revenues and through which debt service on all general obligations of the Commonwealth are made, closed fiscal years ended June 30, 2002, June 30, 2003 and June 30, 2004 with positive fund balances of $3,023 million, $2,357 million, and $3,006 million, respectively.

The continuation of modest economic growth in the U.S. continues to positively impact the revenue estimates incorporated in the Commonwealth’s enacted budget for fiscal year 2005. Actual revenues through April 2005 are nearly $374 million or 1.9 percent above the estimate enacted as part of the fiscal year 2005 budget. Based on projections of revenues, as incorporated in the Governor’s proposed fiscal year 2006 budget released in February 2005, the General Fund is projected to have a preliminary ending balance for the 2005 fiscal year of $268 million.

Debt

The Commonwealth may incur debt to rehabilitate areas affected by disaster, debt approved by the electorate, debt for certain capital projects (projects such as highways, public improvements, transportation assistance, flood control, redevelopment assistance, site development and industrial development) and tax anticipation debt payable in the fiscal year of issuance. The Commonwealth had outstanding general obligation debt of $6,892.6 million at June 30, 2004. The Commonwealth is not permitted to fund deficits between fiscal years with any form of debt. All year-end deficit balances must be funded within the succeeding fiscal year's budget. Over the five-year period ending June 30, 2009, the Commonwealth has projected that it will issue notes and bonds totaling $4,405 million and retire bonded debt in the principal amount of $2,693 million.

Certain agencies created by the Commonwealth have statutory authorization to incur debt for which Commonwealth appropriations to pay debt service thereon are not required. As of December 31, 2004, the combined total debt outstanding for all these agencies was $17,003.6 million. The debt of these agencies is supported by assets of, or revenues derived from, the various projects financed and is not an obligation of the Commonwealth. Some of these agencies, however, are indirectly dependent on Commonwealth appropriations. The only obligations of agencies in the Commonwealth that bear a moral obligation of the Commonwealth are those issued by the Pennsylvania Housing Finance Agency (PHFA), a state-created agency which provides housing for lower and moderate income families, and The Hospitals and Higher Education Facilities Authority of Philadelphia (the "Hospital Authority"), an agency created by the City of Philadelphia to acquire and prepare various sites for use as intermediate care facilities for the mentally retarded.

Local Government Debt

Numerous local government units in the Commonwealth issue general obligation (i.e., backed by taxing power) debt, including counties, cities, boroughs, townships and school districts. School district obligations are supported indirectly by the Commonwealth. The issuance of non-electoral general obligation debt is limited by constitutional and statutory provisions. Electoral debt (i.e., that approved by the voters) is unlimited. In addition, local government units and municipal and other authorities may issue revenue obligations that are supported by the revenues generated from particular projects or enterprises. Examples include municipal authorities (frequently operating water and sewer systems), municipal authorities formed to issue obligations benefiting hospitals and educational institutions, and industrial development authorities, whose obligations benefit industrial or commercial occupants. In some cases, sewer or water revenue obligations are guaranteed by taxing bodies and have the credit characteristics of general obligations debt.

Litigation

The Commonwealth is currently involved in certain litigation where adverse decisions could have an adverse impact on its ability to pay debt service. For example, Unisys Corporation v. Commonwealth involves a challenge on constitutional and statutory grounds to the statutory three-factor apportionment formula used for the apportionment of capital stock value in the franchise tax. On October 25, 2002, the Pennsylvania Supreme Court issued a decision upholding the Commonwealth’s statutory apportionment formula. Unisys’ application for reargument with the Pennsylvania Supreme Court and petition for certiorari to the U.S. Supreme Court were denied. The decision in this matter denied relief to the taxpayer because it failed to carry its burden of proof and did not resolve the underlying issue. Thus, the decision has very limited applicability to the numerous cases pending which raise the identical issue and which collectively involve undetermined but significant dollars. Northbrook Life Insurance Co. is the lead case in potential litigation with the entire insurance industry that does business in Pennsylvania, in which the Pennsylvania Department of Revenue’s application of portions of the Life and Health Guarantee Association Act of 1982 is being challenged. This matter is being prepared for litigation. Settlement negotiations continue although the possibility of settlement appears to be unlikely. Estimates of refund potential vary widely, ranging from $50 million to $300 million. County of Allegheny v. Commonwealth of Pennsylvania involves litigation regarding the state constitutionality of the statutory scheme for county funding of the judicial system. Powell v. Ridge involves a challenge to the Commonwealth’s system for funding public schools on the grounds that such system has the effect of discriminating on the basis of race in violation of Title VI of the Civil Rights Act of 1964. This case remains pending but does not appear to present a viable claim in its present form. Duquesne Light Co. v. Commonwealth involves several appeals covering a number of tax years and taxes. There is over $100 million in total disputed taxes, and issues raised included entitlement to the manufacturing exemption for capital stock tax purposes for the generation of electricity, non-business income treatment on gains realized from the sale of several power plants in Ohio, and where sales receipts should be sourced for corporate net income tax and gross receipts tax purposes. At present, these matters are the subject of discussion between the relevant parties as to how they might be resolved. The specific litigation matters described above are provided as an example only and do not comprise a complete listing of material ongoing or pending litigation involving the Commonwealth of Pennsylvania, its agencies, subdivisions and instrumentalities.

Other Factors

The performance of the obligations held by the Fund issued by the Commonwealth, its agencies, subdivisions and instrumentalities are in part tied to state-wide, regional and local conditions within the Commonwealth and to the creditworthiness of certain non-Commonwealth related obligors, depending upon the Pennsylvania Municipal Money Market Fund's portfolio mix at any given time. Adverse changes to the state-wide, regional or local economies or changes in government may adversely affect the creditworthiness of the Commonwealth, its agencies and municipalities, and certain other non-government related obligors of Pennsylvania tax-free obligations (e.g., a university, a hospital or a corporate obligor). The Cities of Philadelphia and Pittsburgh, for example, have experienced severe financial problems that impaired their ability to borrow money and adversely affected the ratings of their obligations and their marketability. Conversely, some obligations held by the Fund will be almost exclusively dependent on the creditworthiness of one underlying non-government obligor, such as a project occupant or provider of credit or liquidity support.

Statement of Additional Information (SAI)

PART 2

ADDITIONAL INFORMATION ON SECURITIES

AND INVESTMENT PRACTICES

The prospectus describes the Fund’s investment objective and the securities in which it primarily invests. The following describes other securities the Fund may purchase and investment strategies it may use. Some of the information below will not apply to the Fund or the Class in which you are interested. See the list under Other Securities and Practices in Part 1 of this SAI to determine which of the sections below are applicable.

Money Market Instruments

The Fund may invest up to 100% of its assets in high-quality money market instruments, such as notes, certificates of deposit, commercial paper, banker’s acceptances, bank deposits or U.S. government securities if, in the opinion of the investment advisor, market conditions warrant a temporary defensive investment strategy.

U.S. Government Agency Securities

The Fund may invest in securities issued or guaranteed by U.S. Government agencies or instrumentalities.

These securities are backed by (1) the discretionary authority of the U.S. Government to purchase certain obligations of agencies or instrumentalities or (2) the credit of the agency or instrumentality issuing or guaranteeing the obligations.

Some government agencies and instrumentalities may not receive financial support from the U.S. Government. Examples of such agencies are:

(i) Farm Credit System, including the National Bank for Cooperatives, Farm Credit Banks and Banks for Cooperatives;

(ii) Farmers Home Administration;

(iii) Federal Home Loan Banks;

(iv) Federal Home Loan Mortgage Corporation;

Federal National Mortgage Association; and

Student Loan Marketing Association.

Securities Issued by the Government National Mortgage Association (GNMA). The Fund may invest in securities issued by the GNMA, a corporation wholly owned by the U.S. Government. GNMA securities or "certificates" represent ownership in a pool of underlying mortgages. The timely payment of principal and interest due on these securities is guaranteed by GNMA.

Unlike conventional bonds, the principal on GNMA certificates is not paid at maturity but over the life of the security in scheduled monthly payments. While mortgages pooled in a GNMA certificate may have maturities of up to 30 years, the certificate itself will have a shorter average maturity and less principal volatility than a comparable 30‑year bond.

The market value and interest yield of GNMA certificates can vary due not only to market fluctuations, but also to early prepayments of mortgages within the pool. Since prepayment rates vary widely, it is impossible to accurately predict the average maturity of a GNMA pool. In addition to the guaranteed principal payments, GNMA certificates may also make unscheduled principal payments resulting from prepayments on the underlying mortgages.

Although GNMA certificates may offer yields higher than those available from other types of U.S. Government securities, they may be less effective as a means of locking in attractive long‑term rates because of the prepayment feature. For instance, when interest rates decline, prepayments of the underlying mortgages are likely to increase as the holders of the underlying mortgages seek refinancing. As a result, the value of a GNMA certificate is not as likely to rise as the value of a comparable debt security would in response to the same decline. In addition, these prepayments can cause the price of a GNMA certificate originally purchased at a premium to decline in price compared to its par value, which may result in a loss.

When‑Issued, Delayed‑Delivery and Forward Commitment Transactions

The Fund may purchase securities on a when‑issued or delayed delivery 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 Fund may purchase securities under such conditions only 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 Fund may be required to pay more at settlement than the security is worth. In addition, the purchaser is not entitled to any of the interest earned prior to settlement.

Upon making a commitment to purchase a security on a when‑issued, delayed-delivery or forward commitment basis the Fund will hold liquid assets worth at least the equivalent of the amount due. The liquid assets will be monitored on a daily basis and adjusted as necessary to maintain the necessary value.

Purchases made under such conditions may involve the risk that yields secured at the time of commitment may be lower than otherwise available by the time settlement takes place, causing an unrealized loss to the Fund. In addition, when the Fund engages in such purchases, it relies on the other party to consummate the sale. If the other party fails to perform its obligations, the Fund may miss the opportunity to obtain a security at a favorable price or yield.

Repurchase Agreements

The Fund may enter into repurchase agreements with entities that are registered as U.S. Government securities dealers, including member banks of the Federal Reserve System having at least $1 billion in assets, primary dealers in U.S. Government securities, or banks and other recognized financial institutions, such as broker-dealers, which are deemed by the investment advisor to be creditworthy pursuant to guidelines established by the Board of Trustees. In a repurchase agreement the Fund obtains a security and simultaneously commits to return the security to the seller at a set price (including principal and interest) within a period of time usually not exceeding seven days. The resale price reflects the purchase price plus an agreed upon market rate of interest which is unrelated to the coupon rate or maturity of the underlying security. A repurchase agreement involves the obligation of the seller to pay the agreed upon price, which obligation is in effect secured by the value of the underlying security.

The Fund’s custodian or a third party will take possession of the securities subject to repurchase agreements, and these securities will be marked to market daily. To the extent that the original seller does not repurchase the securities from the Fund, the Fund could receive less than the repurchase price on any sale of such securities. In the event that such a defaulting seller filed for bankruptcy or became insolvent, disposition of such securities by the Fund might be delayed pending court action. The Fund's investment advisor believes that under the regular procedures normally in effect for custody of the Fund's portfolio securities subject to repurchase agreements, a court of competent jurisdiction would rule in favor of the Fund and allow retention or disposition of such securities.

Reverse Repurchase Agreements

As described herein, the Fund may also enter into reverse repurchase agreements. These transactions are similar to borrowing cash. In a reverse repurchase agreement, the Fund transfers possession of a portfolio instrument to another person, such as a financial institution, broker, or dealer, in return for a percentage of the instrument's market value in cash, and agrees that on a stipulated date in the future the Fund will repurchase the portfolio instrument by remitting the original consideration plus interest at an agreed upon rate.

The use of reverse repurchase agreements may enable the Fund to avoid selling portfolio instruments at a time when a sale may be deemed to be disadvantageous, but the ability to enter into reverse repurchase agreements does not ensure that the Fund will be able to avoid selling portfolio instruments at a disadvantageous time.

When effecting reverse repurchase agreements, liquid assets of the Fund, in a dollar amount sufficient to make payment for the obligations to be purchased, are segregated at the trade date. The segregated account is marked to market daily and maintained until the transaction is settled.

Leverage

The Fund may engage in transactions that create leverage with up to 30% of its net assets in accordance with Evergreen’s Leverage Policy. Leverage creates special risks for the Fund which are created when an investment exposes the Fund to a level of risk that exceeds the amount invested. Changes in the value of such an investment magnify the Fund’s risk of loss and potential for gain. Examples of transactions which create leverage include uncovered mortgage dollar rolls and investments in when-issued securities (see descriptions herein) as well as investing in securities that are issued on a “to-be-announced” basis (commonly referred to as “TBA’s”) which are purchased prior to their actual issuance. Examples of transactions which are not included in the calculation of the Fund’s total leverage-creating transactions are covered dollar rolls and collateralized securities lending in which the collateral received by the Fund is invested in cash equivalents.

Dollar Roll Transactions

The Fund may enter into dollar rolls in which the Fund sells securities and simultaneously contracts to repurchase substantially similar securities on a specified future date. In the case of dollar rolls involving mortgage-related securities, the mortgage-related securities that are purchased typically will be of the same type and will have the same or similar interest rate and maturity as those sold, but will be supported by different pools of mortgages. The Fund forgoes principal and interest paid during the roll period on the securities sold in a dollar roll, but it is compensated by the difference between the current sales price and the price for the future purchase as well as by any interest earned on the proceeds of the securities sold. The Fund could also be compensated through receipt of fee income.

Dollar rolls are not treated as borrowings or other senior securities and will be excluded from the calculation of the Fund’s borrowings and other senior securities. Investing in dollar rolls creates leverage (unless they are “covered dollar rolls,” see description below) and are included in the calculation of the Fund’s total leverage-creating transactions. In addition to the general risks involved in leveraging, dollar rolls are subject to the same risks as repurchase and reverse repurchase agreements.

Covered Dollar Rolls

The Fund may enter into covered dollar rolls which are the same as the dollar roll transactions described above except that the dollar roll position is offset with a cash or cash equivalent position. The offsetting cash/cash equivalent position effectively collateralizes the Fund’s right to receive the security at the end of the roll period, and also serves to minimize the leveraging effect of the transaction. Covered dollar rolls are not treated as a borrowing or other senior security and will be excluded from the calculation of the Fund’s borrowings and other senior securities. Covered dollar rolls are not considered to be a transaction that creates leverage and will be excluded from the calculation of the Fund’s total leverage-creating transaction.

Securities Lending

The Fund may lend portfolio securities to brokers, dealers and other financial institutions to earn additional income for the Fund. These transactions must be fully collateralized at all times with cash or short-term debt obligations, but involve some risk to the Fund if the other party should default on its obligation and the Fund is delayed or prevented from exercising its rights in respect of the collateral. Any investment of collateral by the Fund would be made in accordance with the Fund's investment objective and policies described in the prospectus.

Convertible Securities

The Fund may invest in convertible securities. Convertible securities include fixed‑income securities that may be exchanged or converted into a predetermined number of shares of the issuer's underlying common stock at the option of the holder during a specified period. Convertible securities may take the form of convertible preferred stock, convertible bonds or debentures, bonds with warrants attached or bonds with a combination of the features of several of these securities. The investment characteristics of each convertible security vary widely, which allow convertible securities to be employed for a variety of investment strategies.

The Fund will exchange or convert convertible securities into shares of underlying common stock when, in the opinion of its investment advisor, the investment characteristics of the underlying common shares will assist the Fund in achieving its investment objective. The Fund may also elect to hold or trade convertible securities. In selecting convertible securities, the investment advisor evaluates the investment characteristics of the convertible security as a fixed‑income instrument, and the investment potential of the underlying equity security for capital appreciation. In evaluating these matters with respect to a particular convertible security, the investment advisor considers numerous factors, including the economic and political outlook, the value of the security relative to other investment alternatives, trends in the determinants of the issuer's profits, and the issuer's management capability and practices.

Preferred Stocks

The Fund may purchase preferred stock. Preferred stock, unlike common stock, has a stated dividend rate payable from the corporation’s earnings. Preferred stock dividends may be cumulative or non-cumulative, participating, or auction rate. “Cumulative” dividend provisions require all or a portion of prior unpaid dividends to be paid.

If interest rates rise, the fixed dividend on preferred stocks may be less attractive, causing the price of preferred stocks to decline. Preferred stock may have mandatory sinking fund provisions, as well as call/redemption provisions prior to maturity, which can be a negative feature when interest rates decline. Preferred stock also generally has a preference over common stock on the distribution of a corporation’s assets in the event of liquidation of the corporation. Preferred stock may be “participating” stock, which means that it may be entitled to a dividend exceeding the stated dividend in certain cases. The rights of preferred stock on distribution of a corporation’s assets in the event of a liquidation are generally subordinate to the rights associated with a corporation’s debt securities.

Warrants

The Fund may invest in warrants. Warrants are options to purchase common stock at a specific price (usually at a premium above the market value of the optioned common stock at issuance) valid for a specific period of time. Warrants may have a life ranging from less than one year to twenty years, or they may be perpetual. However, most warrants have expiration dates after which they are worthless. In addition, a warrant is worthless if the market price of the common stock does not exceed the warrant's exercise price during the life of the warrant. Warrants have no voting rights, pay no dividends, and have no rights with respect to the assets of the corporation issuing them. The percentage increase or decrease in the market price of the warrant may tend to be greater than the percentage increase or decrease in the market price of the optioned common stock.

Swaps, Caps, Floors and Collars

The Fund may enter into interest rate, currency and index swaps and the purchase or sale of related caps, floors and collars. The Fund expects to enter into these transactions primarily to preserve a return or spread on a particular investment or portion of its portfolio, to protect against currency fluctuations, as a duration management technique or to protect against any increase in the price of securities the Fund anticipates purchasing at a later date. The Fund would use these transactions as hedges and not as speculative investments and would not sell interest rate caps or floors where it does not own securities or other instruments providing the income stream the Fund may be obligated to pay. Interest rate swaps involve the exchange by the Fund with another party of their respective commitments to pay or receive interest, e.g., an exchange of floating rate payments for fixed rate payments with respect to a notional amount of principal. A currency swap is an agreement to exchange cash flows on a notional amount of two or more currencies based on the relative value differential among them and an index swap is an agreement to swap cash flows on a notional amount based on changes in the values of the reference indices. The purchase of a cap entitles the purchaser to receive payments on a notional principal amount from the party selling such cap to the extent that a specified index exceeds a predetermined interest rate or amount. The purchase of a floor entitles the purchaser to receive payments on a notional principal amount from the party selling such floor to the extent that a specified index falls below a predetermined interest rate or amount. A collar is a combination of a cap and a floor that preserves a certain return within a predetermined range of interest rates or values.

The Fund will usually enter into swaps on a net basis, i.e., the two payment streams are netted out in a cash settlement on the payment date or dates specified in the instrument, with the Fund receiving or paying, as the case may be, only the net amount of the two payments. The Fund will not enter into any swap, cap, floor or collar transaction unless, at the time of entering into such transaction, the unsecured long-term debt of the counterparty, combined with any credit enhancements, is rated at least A by Standard & Poor’s Ratings Services (S&P) or Moody's Investors Service, Inc. (Moody’s) or has an equivalent rating from another nationally recognized securities rating organization or is determined to be of equivalent credit quality by the Fund's investment advisor. If there is a default by the counterparty, the Fund may have contractual remedies pursuant to the agreements related to the transaction. As a result, the swap market has become relatively liquid. Caps, floors and collars are more recent innovations for which standardized documentation has not yet been fully developed and, accordingly, they are less liquid than swaps.

Indexed Securities

The Fund may invest in indexed securities, the values of which are linked to currencies, interest rates, commodities, indices or other financial indicators ("reference instruments"). Most indexed securities have maturities of three years or less.

Indexed securities differ from other types of debt securities in which the Fund may invest in several respects. First, the interest rate or, unlike other debt securities, the principal amount payable at maturity of an indexed security may vary based on changes in one or more specified reference instruments, such as an interest rate compared with a fixed interest rate or the currency exchange rates between two currencies (neither of which need be the currency in which the instrument is denominated). The reference instrument need not be related to the terms of the indexed security. For example, the principal amount of a U.S. dollar denominated indexed security may vary based on the exchange rate of two foreign currencies. An indexed security may be positively or negatively indexed; that is, its value may increase or decrease if the value of the reference instrument increases. Further, the change in the principal amount payable or the interest rate of an indexed security may be a multiple of the percentage change (positive or negative) in the value of the underlying reference instrument(s).

Investment in indexed securities involves certain risks. In addition to the credit risk of the security's issuer and the normal risks of price changes in response to changes in interest rates, the principal amount of indexed securities may decrease as a result of changes in the value of reference instruments. Further, in the case of certain indexed securities in which the interest rate is linked to a reference instrument, the interest rate may be reduced to zero, and any further declines in the value of the security may then reduce the principal amount payable on maturity. Finally, indexed securities may be more volatile than the reference instruments underlying indexed securities.

To reduce the effect of currency fluctuations on the value of existing or anticipated holdings of portfolio securities, the Fund may also engage in proxy hedging. Proxy hedging is often used when the currency to which the Fund is exposed is difficult to hedge or to hedge against the dollar. Proxy hedging entails entering into a forward contract to sell a currency whose changes in value are generally considered to be linked to a currency or currencies in which some or all of the Fund's securities are or are expected to be denominated, and to buy U.S. dollars. The amount of the contract would not exceed the value of the Fund’s securities denominated in linked currencies. For example, if the Fund's investment advisor considers that the Austrian schilling is linked to the German deutschmark (the "D-mark"), the Fund holds securities denominated in schillings and the investment advisor believes that the value of schillings will decline against the U.S. dollar, the investment advisor may enter into a contract to sell D-marks and buy dollars.

Options and Futures Strategies

The Fund may at times seek to hedge against either a decline in the value of its portfolio securities or an increase in the price of securities which the investment advisor plans to purchase through the writing and purchase of options and the purchase or sale of futures contracts and related options. Expenses and losses incurred as a result of such hedging strategies will reduce the Fund’s current return.

The ability of the Fund to engage in the options and futures strategies described below will depend on the availability of liquid markets in such instruments. It is impossible to predict the amount of trading interest that may exist in various types of options or futures. Therefore, no assurance can be given that the Fund will be able to utilize these instruments effectively for the purposes stated below.

Writing Covered Options on Securities. The Fund may write covered call options and covered put options on optionable securities of the types in which it is permitted to invest from time to time as the investment advisor determines is appropriate in seeking to attain the Fund’s investment objective. Call options written by the Fund give the holder the right to buy the underlying security from the Fund at a stated exercise price; put options give the holder the right to sell the underlying security to the Fund at a stated price.

The Fund may only write call options on a covered basis or for cross-hedging purposes and will only write covered put options. A put option would be considered “covered” if the Fund owns an option to sell the underlying security subject to the option having an exercise price equal to or greater than the exercise price of the “covered” option at all times while the put option is outstanding. A call option is covered if the Fund owns or has the right without additional compensation to acquire the underlying securities subject to the call option (or comparable securities satisfying the cover requirements of securities exchanges) at all times during the option period. A call option is for cross-hedging purposes if it is not covered, but is designed to provide a hedge against another security which the Fund owns or has the right to acquire. In the case of a call written for cross-hedging purposes or a put option, the Fund will maintain in a segregated account at the Fund’s custodian bank cash or short-term U.S. government securities with a value equal to or greater than the Fund’s obligation under the option. The Fund may also write combinations of covered puts and covered calls on the same underlying security.

The Fund will receive a premium from writing an option, which will increase the Fund’s return in the event the option expires unexercised or is terminated at a profit. The amount of the premium will reflect, among other things, the relationship of the market price of the underlying security to the exercise price of the option, the term of the option, and the volatility of the market price of the underlying security. By writing a call option, the Fund will limit its opportunity to profit from any increase in the market value of the underlying security above the exercise price of the option. By writing a put option, the Fund will assume the risk that it may be required to purchase the underlying security for a price higher than its then current market price, resulting in a potential capital loss if the purchase price exceeds market price plus the amount of the premium received.

The Fund may terminate an option which it has written prior to its expiration, by entering into a closing purchase transaction in which it purchases an option having the same terms as the option written. The Fund will realize a profit (or loss) from such transaction if the cost of such transaction is less (or more) than the premium received from the writing of the option. Because increases in the market price of a call option will generally reflect increases in the market price of the underlying security, any loss resulting from the repurchase of a call option may be offset in whole or in part by unrealized appreciation of the underlying security owned by the Fund.

Purchasing Put and Call Options on Securities. The Fund may purchase put options to protect its portfolio holdings in an underlying security against a decline in market value. This protection is provided during the life of the put option since the Fund, as holder of the put, is able to sell the underlying security at the exercise price regardless of any decline in the underlying security’s market price. For the purchase of a put option to be profitable, the market price of the underlying security must decline sufficiently below the exercise price to cover the premium and transaction costs. By using put options in this manner, any profit which the Fund might otherwise have realized on the underlying security will be reduced by the premium paid for the put option and by transaction costs.

The Fund may also purchase a call option to hedge against an increase in price of a security that it intends to purchase. This protection is provided during the life of the call option since the Fund, as holder of the call, is able to buy the underlying security at the exercise price regardless of any increase in the underlying security’s market price. For the purchase of a call option to be profitable, the market price of the underlying security must rise sufficiently above the exercise price to cover the premium and transaction costs. By using call options in this manner, any profit which the Fund might have realized had it bought the underlying security at the time it purchased the call option will be reduced by the premium paid for the call option and by transaction costs.

The Fund may enter into financial futures contracts and write options on such contracts. The Fund intends to enter into such contracts and related options for hedging purposes. The Fund will enter into futures on securities or index‑based futures contracts in order to hedge against changes in interest or exchange rates or securities prices. A futures contract on securities is an agreement to buy or sell securities at a specified price during a designated month. A futures contract on a securities index does not involve the actual delivery of securities, but merely requires the payment of a cash settlement based on changes in the securities index. The Fund does not make payment or deliver securities upon entering into a futures contract. Instead, it puts down a margin deposit, which is adjusted to reflect changes in the value of the contract and which continues until the contract is terminated.

The Fund may sell or purchase futures contracts. When a futures contract is sold by the Fund, the value of the contract will tend to rise when the value of the underlying securities declines and to fall when the value of such securities increases. Thus, the Fund sells futures contracts in order to offset a possible decline in the value of its securities. If a futures contract is purchased by the Fund, the value of the contract will tend to rise when the value of the underlying securities increases and to fall when the value of such securities declines. The Fund intends to purchase futures contracts in order to establish what is believed by the investment advisor to be a favorable price or rate of return for securities the Fund intends to purchase.

The Fund also intends to purchase put and call options on futures contracts for hedging purposes. A put option purchased by the Fund would give it the right to assume a position as the seller of a futures contract. A call option purchased by the Fund would give it the right to assume a position as the purchaser of a futures contract. The purchase of an option on a futures contract requires the Fund to pay a premium. In exchange for the premium, the Fund becomes entitled to exercise the benefits, if any, provided by the futures contract, but is not required to take any action under the contract. If the option cannot be exercised profitably before it expires, the Fund's loss will be limited to the amount of the premium and any transaction costs.

The Fund may enter into closing purchase and sale transactions in order to terminate a futures contract and may sell put and call options for the purpose of closing out its options positions. The Fund's ability to enter into closing transactions depends on the development and maintenance of a liquid secondary market. There is no assurance that a liquid secondary market will exist for any particular contract or at any particular time. As a result, there can be no assurance that the Fund will be able to enter into an offsetting transaction with respect to a particular contract at a particular time. If the Fund is not able to enter into an offsetting transaction, the Fund will continue to be required to maintain the margin deposits on the contract and to complete the contract according to its terms, in which case it would continue to bear market risk on the transaction.

Although futures and options transactions are intended to enable the Fund to manage market, interest rate or exchange rate risk, unanticipated changes in interest rates or market prices could result in poorer performance than if it had not entered into these transactions. Even if the investment advisor correctly predicts interest rate movements, a hedge could be unsuccessful if changes in the value of the Fund's futures position did not correspond to changes in the value of its investments. This lack of correlation between the Fund's futures and securities positions may be caused by differences between the futures and securities markets or by differences between the securities underlying the Fund's futures position and the securities held by or to be purchased for the Fund. The Fund's investment advisor will attempt to minimize these risks through careful selection and monitoring of the Fund's futures and options positions.

The Fund does not intend to use futures transactions for speculation or leverage. The Fund has the ability to write options on futures, but currently intends to write such options only to close out options purchased by the Fund. The Fund will not change these policies without supplementing the information in the prospectus or SAI.

“Margin” in Futures Transactions. Unlike the purchase or sale of a security, the Fund does not pay or receive money upon the purchase or sale of a futures contract. Rather the Fund is required to deposit an amount of "initial margin" in cash or U.S. Treasury bills with its custodian (or the broker, if legally permitted). The nature of initial margin in futures transactions is different from that of margin in securities transactions in that futures contract initial margin does not involve the borrowing of funds by the Fund to finance the transactions. Initial margin is in the nature of a performance bond or good faith deposit on the contract which is returned to the Fund upon termination of the futures contract, assuming all contractual obligations have been satisfied.

A futures contract held by the Fund is valued daily at the official settlement price of the exchange on which it is traded. Each day the Fund pays or receives cash, called "variation margin," equal to the daily change in value of the futures contract. This process is known as "marking to market”. Variation margin does not represent a borrowing or loan by the Fund but is instead settlement between the Fund and the broker of the amount one would owe the other if the futures contract expired. In computing its daily net asset value the Fund will mark‑to‑market its open futures positions. The Fund is also required to deposit and maintain margin when it writes call options on futures contracts.

Limitations. The Fund will not purchase or sell futures contracts or options on futures contracts if, as a result, the sum of the initial margin deposits on its existing futures contracts and related options positions and premiums paid for options on futures contracts would exceed 5% of the net assets of the Fund unless the transaction meets certain “bona fide hedging” criteria. The Fund will not maintain open positions in futures contracts it has sold or call options it has written on futures contracts if, in the aggregate, the value of the open positions (marked to market) exceeds the current market value of its securities portfolio plus or minus the unrealized gain or loss on those open positions, adjusted for the correlation of volatility between the hedged securities and the futures contracts. If this limitation is exceeded at any time, the Fund will take prompt action to close out a sufficient number of open contracts to bring its open futures and options positions within this limitation.

Risks of Options and Futures Strategies. The effective use of options and futures strategies depends, among other things, on the Fund’s ability to terminate options and futures positions at times when the investment advisor deems it desirable to do so. Although the Fund will not enter into an option or futures position unless the investment advisor believes that a liquid market exists for such option or future, there can be no assurance that the Fund will be able to effect closing transactions at any particular time or at an acceptable price. The investment advisor generally expects that options and futures transactions for the Fund will be conducted on recognized exchanges. In certain instances, however, the Fund may purchase and sell options in the over-the-counter market. The staff of the Securities and Exchange Commission (SEC) considers over-the-counter options to be illiquid. The Fund’s ability to terminate option positions established in the over-the-counter market may be more limited than in the case of exchange traded options and may also involve the risk that securities dealers participating in such transactions would fail to meet their obligations to the Fund.

The use of options and futures involves the risk of imperfect correlation between movements in options and futures prices and movements in the price of the securities that are the subject of the hedge. The successful use of these strategies also depends on the ability of the Fund’s investment advisor to forecast correctly interest rate movements and general stock market price movements. The risk increases as the composition of the securities held by the Fund diverges from the composition of the relevant option or futures contract.

Brady Bonds

The Fund may also invest in Brady Bonds. Brady Bonds are created through the exchange of existing commercial bank loans to foreign entities for new obligations in connection with debt restructuring under a plan introduced by former U.S. Secretary of the Treasury, Nicholas F. Brady (the "Brady Plan"). Brady Bonds have been issued only recently, and, accordingly, do not have a long payment history. They may be collateralized or uncollateralized and issued in various currencies (although most are U.S. dollar-denominated) and they are actively traded in the over-the-counter secondary market.

U.S. dollar-denominated, collateralized Brady Bonds, which may be fixed-rate par bonds or floating rate discount bonds, are generally collateralized in full as to principal due at maturity by U.S. Treasury zero coupon obligations that have the same maturity as the Brady Bonds. Interest payments on these Brady Bonds generally are collateralized by cash or securities in an amount that, in the case of fixed rate bonds, is equal to at least one year of rolling interest payments based on the applicable interest rate at that time and is adjusted at regular intervals thereafter. Certain Brady Bonds are entitled to "value recovery payments" in certain circumstances, which in effect constitute supplemental interest payments, but generally are not collateralized. Brady Bonds are often viewed as having up to four valuation components: (1) collateralized repayment of principal at final maturity, (2) collateralized interest payments, (3) uncollateralized interest payments, and (4) any uncollateralized repayment of principal at maturity (these uncollateralized amounts constitute the "residual risk"). In the event of a default with respect to collateralized Brady Bonds as a result of which the payment obligations of the issuer are accelerated, the U.S. Treasury zero coupon obligations held as collateral for the payment of principal will not be distributed to investors, nor will such obligations be sold and the proceeds distributed. The collateral will be held by the collateral agent to the scheduled maturity of the defaulted Brady Bonds, which will continue to be outstanding, at which time the face amount of the collateral will equal the principal payments that would have then been due on the Brady Bonds in the normal course. In addition, in light of the residual risk of Brady Bonds and, among other factors, the history of defaults with respect to commercial bank loans by public and private entities of countries issuing Brady Bonds, investments in Brady Bonds are to be viewed as speculative.

Obligations of Foreign Branches of United States Banks

The Fund may invest in obligations of foreign branches of U.S. banks. These may be general obligations of the parent bank in addition to the issuing branch, or may be limited by the terms of a specific obligation and by government regulation. Payment of interest and principal upon these obligations may also be affected by governmental action in the country of domicile of the branch (generally referred to as sovereign risk). In addition, evidences of ownership of such securities may be held outside the U.S. and the Fund may be subject to the risks associated with the holding of such property overseas. Examples of governmental actions would be the imposition of currency controls, interest limitations, withholding taxes, seizure of assets or the declaration of a moratorium. Various provisions of federal law governing domestic branches do not apply to foreign branches of domestic banks.

Obligations of United States Branches of Foreign Banks

The Fund may invest in obligations of U.S. branches of foreign banks. These may be general obligations of the parent bank in addition to the issuing branch, or may be limited by the terms of a specific obligation and by federal and state regulation as well as by governmental action in the country in which the foreign bank has its head office. In addition, there may be less publicly available information about a U.S. branch of a foreign bank than about a domestic bank.

Foreign Securities

The Fund may invest in foreign securities or U.S. securities traded in foreign markets. In addition to securities issued by foreign companies, permissible investments may also consist of obligations of foreign branches of U.S. banks and of foreign banks, including European certificates of deposit, European time deposits, Canadian time deposits and Yankee certificates of deposit. The Fund may also invest in Canadian commercial paper and Europaper. These instruments may subject the Fund to investment risks that differ in some respects from those related to investments in obligations of U.S. issuers. Such risks include the possibility of adverse political and economic developments; imposition of withholding taxes on interest or other income; seizure, nationalization, or expropriation of foreign deposits; establishment of exchange controls or taxation at the source; greater fluctuations in value due to changes in exchange rates, or the adoption of other foreign governmental restrictions which might adversely affect the payment of principal and interest on such obligations. Such investments may also entail higher custodial fees and sales commissions than domestic investments. Foreign issuers of securities or obligations are often subject to accounting treatment and engage in business practices different from those respecting domestic issuers of similar securities or obligations. Foreign branches of U.S. banks and foreign banks may be subject to less stringent reserve requirements than those applicable to domestic branches of U.S. banks.

The Fund may also invest in the stocks of companies located in emerging markets. These countries generally have economic structures that are less diverse and mature, and political systems that are less stable than those of developed countries. Emerging markets may be more volatile than the markets of more mature economies, and the securities of companies located in emerging markets are often subject to rapid and large price fluctuations; however, these markets may also provide higher long-term rates of return.

Inter-american Development Bank and World Bank (formerly known as the International Bank for Reconstruction and Development)

The Fund may be subject to risks associated with obligations of the Inter-american Development Bank and World Bank (formerly known as the International Bank for Reconstruction and Development). Because these entities are not governmental entities with taxing authority, and may be supported only by appropriate but unpaid commitments of member countries, there is no assurance that the commitments will be undertaken in the future.

Foreign Currency Transactions

As one way of managing exchange rate risk, the Fund may enter into forward currency exchange contracts (agreements to purchase or sell currencies at a specified price and date). The exchange rate for the transaction (the amount of currency the Fund will deliver and receive when the contract is completed) is fixed when the Fund enters into the contract. The Fund usually will enter into these contracts to stabilize the U.S. dollar value of a security it has agreed to buy or sell. The Fund intends to use these contracts to hedge the U.S. dollar value of a security it already owns, particularly if the Fund expects a decrease in the value of the currency in which the foreign security is denominated. Although the Fund will attempt to benefit from using forward contracts, the success of its hedging strategy will depend on the investment advisor's ability to predict accurately the future exchange rates between foreign currencies and the U.S. dollar. The value of the Fund's investments denominated in foreign currencies will depend on the relative strengths of those currencies and the U.S. dollar, and the Fund may be affected favorably or unfavorably by changes in the exchange rates or exchange control regulations between foreign currencies and the U.S. dollar. Changes in foreign currency exchange rates also may affect the value of dividends and interest earned, gains and losses realized on the sale of securities and net investment income and gains, if any, to be distributed to shareholders by the Fund. The Fund may also purchase and sell options related to foreign currencies in connection with hedging strategies.

Currency Cross-hedge

A currency cross-hedge enables the advisor to reduce exposure in one foreign currency relative to exposure in a second foreign currency. This strategy would make sense when the Fund wants to maintain its overall foreign currency exposure, but feels that some of the currencies are relatively more attractive. An example would be where the manager feels that the British Pound is more attractive than the Euro, and cross-hedges some Euro-denominated bonds back to the Pound Sterling. The overall foreign currency exposure stays constant, but the relative weighting of the Pound versus the Euro increases.

Currency Proxy-hedge

A currency proxy-hedge enables the advisor to hedge a foreign currency exposure back to the U.S. dollar by using a second currency that has a high correlation to the actual long position, but where the second currency hedge would be either more liquid or less costly. An example might be where the manager owns a position denominated in Indonesian Rupiah, but where the Yen has higher liquidity and is deemed a more cost effective hedge.

Creating a Net Long Position Versus a Foreign Currency

Creating a net long position would be a situation where the manager of the Fund wishes to create exposure to a currency that exceeds the value of securities denominated in that currency that are held by the Fund. An example might be where the manager has reduced his weighting in Japanese bonds to 10% below the benchmark due to concerns with the bonds, but wants to maintain a market weighting in the Yen. Creating a long position in the Yen would accomplish this result.

Premium Securities

The Fund may at times invest in premium securities which are securities bearing coupon rates higher than prevailing market rates. Such "premium" securities are typically purchased at prices greater than the principal amount payable on maturity. Although the Fund generally amortizes the amount of any such premium into income, the Fund may recognize a capital loss if such premium securities are called or sold prior to maturity and the call or sale price is less than the purchase price. Additionally, the Fund may recognize a capital loss if it holds such securities to maturity.

High Yield, High Risk Bonds

The Fund may invest a portion of its assets in lower rated bonds. Bonds rated below BBB by S&P or Fitch IBCA, Inc. (Fitch) or below Baa by Moody’s, commonly known as “junk bonds,” offer high yields, but also high risk. While investment in junk bonds provides opportunities to maximize return over time, they are considered predominantly speculative with respect to the ability of the issuer to meet principal and interest payments. Investors should be aware of the following risks:

(1) The lower ratings of junk bonds reflect a greater possibility that adverse changes in the financial condition of the issuer or in general economic conditions, or both, or an unanticipated rise in interest rates may impair the ability of the issuer to make payments of interest and principal, especially if the issuer is highly leveraged. Such issuer's ability to meet its debt obligations may also be adversely affected by the issuer's inability to meet specific forecasts or the unavailability of additional financing. Also, an economic downturn or an increase in interest rates may increase the potential for default by the issuers of these securities.

(2) The value of junk bonds may be more susceptible to real or perceived adverse economic or political events than is the case for higher quality bonds.

(3) The value of junk bonds, like those of other fixed income securities, fluctuates in response to changes in interest rates, generally rising when interest rates decline and falling when interest rates rise. For example, if interest rates increase after a fixed income security is purchased, the security, if sold prior to maturity, may return less than its cost. The prices of junk bonds, however, are generally less sensitive to interest rate changes than the prices of higher‑rated bonds, but are more sensitive to news about an issuer or the economy which is, or investors perceive as, negative.

(4) The secondary market for junk bonds may be less liquid at certain times than the secondary market for higher quality bonds, which may adversely affect (a) the bond's market price, (b) the Fund's ability to sell the bond, and (c) the Fund's ability to obtain accurate market quotations for purposes of valuing its assets.

For bond ratings descriptions, see “Corporate and Municipal Bond Ratings” below.

Sovereign Debt Obligations

The Fund may purchase sovereign debt instruments issued or guaranteed by foreign governments or their agencies, including debt of Latin American nations or other developing countries. Sovereign debt may be in the form of conventional securities or other types of debt instruments such as loans or loan participations. Sovereign debt of developing countries may involve a high degree of risk, and may be in default or present the risk of default. Governmental entities responsible for repayment of the debt may be unable or unwilling to repay principal and interest when due, and may require renegotiation or rescheduling of debt payments. In addition, prospects for repayment of principal and interest may depend on political as well as economic factors.

Illiquid and Restricted Securities

The Fund may not invest more than 15% (10% for money market funds) of its net assets in securities that are illiquid. A security is illiquid when the Fund cannot dispose of it in the ordinary course of business within seven days at approximately the value at which the Fund has the investment on its books.

The Fund may invest in "restricted" securities, i.e., securities subject to restrictions on resale under federal securities laws. Rule 144A under the Securities Act of 1933 ("Rule 144A") allows certain restricted securities to trade freely among qualified institutional investors. Since Rule 144A securities may have limited markets, the Board of Trustees will determine whether such securities should be considered illiquid for the purpose of determining the Fund's compliance with the limit on illiquid securities indicated above. In determining the liquidity of Rule 144A securities, the Trustees will consider: (1) the frequency of trades and quotes for the security; (2) the number of dealers willing to purchase or sell the security and the number of other potential buyers; (3) dealer undertakings to make a market in the security; and (4) the nature of the security and the nature of the marketplace trades.

Investment in Other Investment Companies

The Fund may purchase the shares of other investment companies to the extent permitted under the 1940 Act. Currently, the Fund may not (1) own more than 3% of the outstanding voting shares of another investment company, (2) invest more than 5% of its assets in any single investment company, and (3) invest more than 10% of its assets in investment companies. However, the Fund may invest all of its investable assets in securities of a single open‑end management investment company with substantially the same fundamental investment objectives, policies and limitations as the Fund. Investing in other investment companies may expose a Fund to duplicate expenses and lower its value.

Notwithstanding the foregoing, as a result of an exemptive order received from the SEC, the Fund may invest cash balances in shares of other money market funds advised by the Fund’s investment advisor or an affiliate of the investment advisor, in amounts up to 25% of the Fund’s total assets.

Short Sales

A short sale is the sale of a security the Fund has borrowed. The Fund expects to profit from a short sale by selling the borrowed security for more than the cost of buying it to repay the lender. After a short sale is completed, the value of the security sold short may rise. If that happens, the cost of buying it to repay the lender may exceed the amount originally received for the sale by the Fund.

The Fund may engage in short sales, but it may not make short sales of securities or maintain a short position unless, at all times when a short position is open, it owns an equal amount of such securities or of securities which, without payment of any further consideration, are convertible into or exchangeable for securities of the same issue as, and equal in amount to, the securities sold short. The Fund may effect a short sale in connection with an underwriting in which the Fund is a participant.

Municipal Securities

The Fund may invest in municipal bonds of any state, territory or possession of the United States (U.S.), including the District of Columbia. The Fund may also invest in municipal bonds of any political subdivision, agency or instrumentality (e.g., counties, cities, towns, villages, districts, authorities) of the U.S. or its possessions. Municipal bonds are debt instruments issued by or for a state or local government to support its general financial needs or to pay for special projects such as airports, bridges, highways, public transit, schools, hospitals, housing and water and sewer works. Municipal bonds may also be issued to refinance public debt.

Municipal bonds are mainly divided between "general obligation" and "revenue" bonds. General obligation bonds are backed by the full faith and credit of governmental issuers with the power to tax. They are repaid from the issuer's general revenues. Payment, however, may be dependent upon legislative approval and may be subject to limitations on the issuer's taxing power. Enforcement of payments due under general obligation bonds varies according to the law applicable to the issuer. In contrast, revenue bonds are supported only by the revenues generated by the project or facility.

The Fund may also invest in industrial development bonds. Such bonds are usually revenue bonds issued to pay for facilities with a public purpose operated by private corporations. The credit quality of industrial development bonds is usually directly related to the credit standing of the owner or user of the facilities. To qualify as a municipal bond, the interest paid on an industrial development bond must qualify as fully exempt from federal income tax. However, the interest paid on an industrial development bond may be subject to the federal alternative minimum tax.

The yields on municipal bonds depend on such factors as market conditions, the financial condition of the issuer and the issue's size, maturity date and rating. Municipal bonds are rated by S&P, Moody's and Fitch. Such ratings, however, are opinions, not absolute standards of quality. Municipal bonds with the same maturity, interest rates and rating may have different yields, while municipal bonds with the same maturity and interest rate, but different ratings, may have the same yield. Once purchased by the Fund, a municipal bond may cease to be rated or receive a new rating below the minimum required for purchase by the Fund. Neither event would require the Fund to sell the bond, but the Fund's investment advisor would consider such events in determining whether the Fund should continue to hold it.

The ability of the Fund to achieve its investment objective depends upon the continuing ability of issuers of municipal bonds to pay interest and principal when due. Municipal bonds are subject to the provisions of bankruptcy, insolvency and other laws affecting the rights and remedies of creditors. Such laws extend the time for payment of principal and/or interest, and may otherwise restrict the Fund's ability to enforce its rights in the event of default. Since there is generally less information available on the financial condition of municipal bond issuers compared to other domestic issuers of securities, the Fund's investment advisor may lack sufficient knowledge of an issue's weaknesses. Other influences, such as litigation, may also materially affect the ability of an issuer to pay principal and interest when due. In addition, the market for municipal bonds is often thin and can be temporarily affected by large purchases and sales, including those by the Fund.

From time to time, Congress has considered restricting or eliminating the federal income tax exemption for interest on municipal bonds. Such actions could materially affect the availability of municipal bonds and the value of those already owned by the Fund. If such legislation were passed, the Trust's Board of Trustees may recommend changes in the Fund's investment objectives and policies or dissolution of the Fund. Inorder for the interest on a municipal security to be tax exempt, the municipal security must meet certain legal requirements. Failure to meet such requirements may cause the interest received and distributed by the Fund to shareholders to be taxable.

U.S. Virgin Islands, Guam and Puerto Rico

The Fund may invest in obligations of the governments of the U.S. Virgin Islands, Guam and Puerto Rico to the extent such obligations are exempt from the income or intangibles taxes, as applicable, of the state for which the Fund is named. The Fund does not presently intend to invest more than (a) 10% of its net assets in the obligations of each of the U.S. Virgin Islands and Guam or (b) 25% of its net assets in the obligations of Puerto Rico. Accordingly, the Fund may be adversely affected by local political and economic conditions and developments within the U.S. Virgin Islands, Guam and Puerto Rico affecting the issuers of such obligations.

Tender Option Bonds

A tender option bond is a municipal obligation (generally held pursuant to a custodial arrangement) having a relatively long maturity and bearing interest at a fixed rate substantially higher than prevailing short-term, tax-exempt rates. The bond is typically issued in conjunction with the agreement of a third party, such as a bank, broker-dealer or other financial institution, pursuant to which the institution grants the security holder the option, at periodic intervals, to tender its securities to the institution. As consideration for providing the option, the financial institution receives periodic fees equal to the difference between the bond’s fixed coupon rate and the rate, as determined by a remarketing or similar agent, that would cause the securities, coupled with the tender option, to trade at par on the date of such determination. Thus, after payment of this fee, the security holder effectively holds a demand obligation that bears interest at the prevailing short-term, tax-exempt rate. An institution will normally not be obligated to accept tendered bonds in the event of certain defaults or a significant downgrading in the credit rating assigned to the issuer of the bond. The tender option will be taken into account in determining the maturity of the tender option bonds and a Fund’s average portfolio maturity. There is a risk that a Fund will not be considered the owner of a tender option bond for federal income tax purposes, and thus will not be entitled to treat such interest as exempt from federal income tax. Certain tender option bonds may be illiquid or may become illiquid as a result of a credit rating downgrade, payment default or a disqualification from tax-exempt status.

Master Demand Notes

The Fund may invest in master demand notes. These are unsecured obligations that permit the investment of fluctuating amounts by the Fund at varying rates of interest pursuant to direct arrangements between the Fund, as lender, and the issuer, as borrower. Master demand notes may permit daily fluctuations in the interest rate and daily changes in the amounts borrowed. The Fund has the right to increase the amount under the note at any time up to the full amount provided by the note agreement, or to decrease the amount. The borrower may repay up to the full amount of the note without penalty. Master demand notes permit the Fund to demand payment of principal and accrued interest at any time (on not more than seven days' notice). Notes acquired by the Fund may have maturities of more than one year, provided that (1) the Fund is entitled to payment of principal and accrued interest upon not more than seven days' notice, and (2) the rate of interest on such notes is adjusted automatically at periodic intervals, which normally will not exceed 31 days, but may extend up to one year. The notes are deemed to have a maturity equal to the longer of the period remaining to the next interest rate adjustment or the demand notice period. Because these types of notes are direct lending arrangements between the lender and borrower, such instruments are not normally traded and there is no secondary market for these notes, although they are redeemable and thus repayable by the borrower at face value plus accrued interest at any time. Accordingly, the Fund's right to redeem is dependent on the ability of the borrower to pay principal and interest on demand. In connection with master demand note arrangements, the Fund‘s investment advisor considers, under standards established by the Board of Trustees, earning power, cash flow and other liquidity ratios of the borrower and will monitor the ability of the borrower to pay principal and interest on demand. These notes are not typically rated by credit rating agencies. Unless rated, the Fund may invest in them only if at the time of an investment the issuer meets the criteria established for high quality commercial paper, i.e., rated A-1 by S&P, Prime-1 by Moody’s or F-1 by Fitch.

Payment‑in‑kind Securities

The Fund may invest in payment‑in‑kind (PIK) securities. PIKs pay interest in either cash or additional securities, at the issuer's option, for a specified period. The issuer's option to pay in additional securities typically ranges from one to six years, compared to an average maturity for all PIK securities of eleven years. Call protection and sinking fund features are comparable to those offered on traditional debt issues.

PIKs, like zero coupon bonds, are designed to give an issuer flexibility in managing cash flow. Several PIKs are senior debt. In other cases, where PIKs are subordinated, most senior lenders view them as equity equivalents.

An advantage of PIKs for the issuer ‑‑ as with zero coupon securities ‑‑ is that interest payments are automatically compounded (reinvested) at the stated coupon rate, which is not the case with cash‑paying securities. However, PIKs are gaining popularity over zeros since interest payments in additional securities can be monetized and are more tangible than accretion of a discount.

As a group, PIK bonds trade flat (i.e., without accrued interest). Their price is expected to reflect an amount representing accreted interest since the last payment. PIKs generally trade at higher yields than comparable cash‑paying securities of the same issuer. Their premium yield is the result of the lesser desirability of non‑cash interest, the more limited audience for non‑cash paying securities, and the fact that many PIKs have been issued to equity investors who do not normally own or hold such securities.

Calculating the true yield on a PIK security requires a discounted cash flow analysis if the security (ex interest) is trading at a premium or a discount because the realizable value of additional payments is equal to the current market value of the underlying security, not par.

Regardless of whether PIK securities are senior or deeply subordinated, issuers are highly motivated to retire them because they are usually their most costly form of capital.

Zero Coupon "Stripped" Bonds

The Fund may invest in zero coupon "stripped" bonds. These represent ownership in serially maturing interest payments or principal payments on specific underlying notes and bonds, including coupons relating to such notes and bonds. The interest and principal payments are direct obligations of the issuer. Interest zero coupon bonds of any series mature periodically from the date of issue of such series through the maturity date of the securities related to such series. Principal zero coupon bonds mature on the date specified therein, which is the final maturity date of the related securities. Each zero coupon bond entitles the holder to receive a single payment at maturity. There are no periodic interest payments on a zero coupon bond. Zero coupon bonds are offered at discounts from their face amounts.

In general, owners of zero coupon bonds have substantially all the rights and privileges of owners of the underlying coupon obligations or principal obligations. Owners of zero coupon bonds have the right upon default on the underlying coupon obligations or principal obligations to proceed directly and individually against the issuer and are not required to act in concert with other holders of zero coupon bonds.

For federal income tax purposes, a purchaser of principal zero coupon bonds or interest zero coupon bonds (either initially or in the secondary market) is treated as if the buyer had purchased a corporate obligation issued on the purchase date with an original issue discount equal to the excess of the amount payable at maturity over the purchase price. The purchaser is required to take into income each year as ordinary income an allocable portion of such discounts determined on a "constant yield" method. Any such income increases the holder's tax basis for the zero coupon bond, and any gain or loss on a sale of the zero coupon bonds relative to the holder's basis, as so adjusted, is a capital gain or loss. If the holder owns both principal zero coupon bonds and interest zero coupon bonds representing an interest in the same underlying issue of securities, a special basis allocation rule (requiring the aggregate basis to be allocated among the items sold and retained based on their relative fair market value at the time of sale) may apply to determine the gain or loss on a sale of any such zero coupon bonds.

Mortgage‑Backed or Asset‑Backed Securities

The Fund may invest in mortgage‑backed securities and asset‑backed securities. Two principal types of mortgage‑backed securities are collateralized mortgage obligations (CMOs) and real estate mortgage investment conduits (REMICs). CMOs are securities collateralized by mortgages, mortgage pass‑throughs, mortgage pay‑through bonds (bonds representing an interest in a pool of mortgages where the cash flow generated from the mortgage collateral pool is dedicated to bond repayment), and mortgage‑backed bonds (general obligations of the issuers payable out of the issuers' general funds and additionally secured by a first lien on a pool of single family detached properties). Many CMOs are issued with a number of classes or series which have different maturities and are retired in sequence.

Investors purchasing CMOs in the shortest maturities receive or are credited with their pro rata portion of the scheduled payments of interest and principal on the underlying mortgages plus all unscheduled prepayments of principal up to a predetermined portion of the total CMO obligation. Until that portion of such CMO obligation is repaid, investors in the longer maturities receive interest only. Accordingly, the CMOs in the longer maturity series are less likely than other mortgage pass‑throughs to be prepaid prior to their stated maturity. Although some of the mortgages underlying CMOs may be supported by various types of insurance, and some CMOs may be backed by GNMA certificates or other mortgage pass‑throughs issued or guaranteed by U.S. government agencies or instrumentalities, the CMOs themselves are not generally guaranteed.

REMICs are private entities formed for the purpose of holding a fixed pool of mortgages secured by an interest in real property. REMICs are similar to CMOs in that they issue multiple classes of securities.

In addition to mortgage‑backed securities, the Fund may invest in securities secured by other assets including company receivables, truck and auto loans, leases, and credit card receivables. These issues may be traded over‑the‑counter and typically have a short‑intermediate maturity structure depending on the pay down characteristics of the underlying financial assets which are passed through to the security holder.

Credit card receivables are generally unsecured and the debtors are entitled to the protection of a number of state and federal consumer credit laws, many of which give such debtors the right to set off certain amounts owed on the credit cards, thereby reducing the balance due. Most issuers of asset‑backed securities backed by automobile receivables permit the servicers of such receivables to retain possession of the underlying obligations. If the servicers were to sell these obligations to another party, there is a risk that the purchaser would acquire an interest superior to that of the holders of the related asset‑backed securities. In addition, because of the large number of vehicles involved in a typical issuance and technical requirements under state laws, the trustee for the holders of related asset‑backed securities backed by automobile receivables may not have a proper security interest in all of the obligations backing such receivables. Therefore, there is the possibility that recoveries on repossessed collateral may not, in some cases, be available to support payments on these securities.

In general, issues of asset‑backed securities are structured to include additional collateral and/or additional credit support to protect against the risk that a portion of the collateral supporting the asset‑backed securities may default and/or may suffer from these defects. In evaluating the strength of particular issues of asset‑backed securities, the investment advisor considers the financial strength of the guarantor or other provider of credit support, the type and extent of credit enhancement provided as well as the documentation and structure of the issue itself and the credit support.

TBA Mortgage Securities

TBA refers to “To Be Announced.” These types of securities are mortgage pools where the issuer has defined and agreed to, in advance, the terms for investors, but has not yet specified the mortgages that will act as collateral.

Variable or Floating Rate Instruments

The Fund may invest in variable or floating rate instruments which may involve a demand feature and may include variable amount master demand notes which may or may not be backed by bank letters of credit. Variable or floating rate instruments bear interest at a rate which varies with changes in market rates. The holder of an instrument with a demand feature may tender the instrument back to the issuer at par prior to maturity. A variable amount master demand note is issued pursuant to a written agreement between the issuer and the holder, its amount may be increased by the holder or decreased by the holder or issuer, it is payable on demand, and the rate of interest varies based upon an agreed formula. The quality of the underlying credit must, in the opinion of the investment advisor, be equivalent to the long‑term bond or commercial paper ratings applicable to permitted investments for the Fund. The investment advisor will monitor, on an ongoing basis, the earning power, cash flow, and liquidity ratios of the issuers of such instruments and will similarly monitor the ability of an issuer of a demand instrument to pay principal and interest on demand.

Real Estate Investment Trusts

The Fund may invest in investments related to real estate including real estate investment trusts (REITs). Risks associated with investments in securities of companies in the real estate industry include: decline in the value of real estate; risks related to general and local economic conditions, overbuilding and increased competition; increases in property taxes and operating expenses; changes in zoning laws; casualty or condemnation losses; variations in rental income; changes in neighborhood values; the appeal of properties to tenants; and increases in interest rates. In addition, equity REITs may be affected by changes in the values of the underlying property owned by the trusts, while mortgage real estate investment trusts may be affected by borrower default risk and interest rate risk. REITs are dependent upon management skills, may not be diversified and are subject to the risks of financing projects. Such REITs are also subject to heavy cash flow dependency, defaults by borrowers, self liquidation and the possibility of failing to qualify for tax-free pass-through of income under the Internal Revenue Code of 1986, as amended (the “Code”) and to maintain exemption from the 1940 Act. In the event an issuer of debt securities collateralized by real estate defaults, it is conceivable that the REITs could end up holding the underlying real estate.

Limited Partnerships

The Fund may invest in limited and master limited partnerships. A limited partnership is a partnership consisting of one or more general partners, jointly and severally responsible as ordinary partners, and by whom the business is conducted, and one or more limited partners who contribute cash as capital to the partnership and who generally are not liable for the debts of the partnership beyond the amounts contributed. Limited partners are not involved in the day-to-day management of the partnership. They receive income, capital gains and other tax benefits associated with the partnership project in accordance with terms established in the partnership agreement. Typical limited partnerships are in real estate, oil and gas and equipment leasing, but they also finance movies, research and development, and other projects.

For an organization classified as a partnership under the Code, each item of income, gain, loss, deduction, and credit is not taxed at the partnership level but flows through to the holder of the partnership unit. This allows the partnership to avoid double taxation and to pass through income to the holder of the partnership unit at lower individual rates.

A master limited partnership is a publicly traded limited partnership. The partnership units are registered with the SEC and are freely exchanged on a securities exchange or in the over-the-counter market.

Stand-by Commitments

When the Fund purchases tax-exempt securities, it has the authority to acquire stand-by commitments from banks and broker-dealers with respect to those tax-exempt securities. A stand-by commitment may be considered a security independent of the state tax-exempt security to which it relates. The amount payable by a bank or dealer during the time a stand-by commitment is exercisable, absent unusual circumstances, would be substantially the same as the market value of the underlying tax-exempt security to a third party at any time. The Fund expects that stand-by commitments generally will be available without the payment of direct or indirect consideration. No Fund expects to assign any value to stand-by commitments.

Domestic Equity Depositary Receipts

The Fund may invest in Domestic Equity Depositary Receipts. These instruments represent interests in a unit investment trust (“UIT”) that holds a portfolio of common stocks that is intended to track the price and dividend performance of a particular index. Common examples of Domestic Equity Depositary Receipts include S&P Depositary Receipts (“SPDRs”) and Nasdaq 100 Shares, which may be obtained from the UIT issuing the securities or purchased in the secondary market (SPDRs and Nasdaq 100 Shares are listed on the American Stock Exchange).

Domestic Equity Depositary Receipts are not individually redeemable, except upon termination of the UIT that issued them. The liquidity of small holdings of Domestic Equity Depositary Receipts depends upon the existence of a secondary market.

The redemption price (and therefore the sale price) of Domestic Equity Depositary Receipts is derived from and based upon the securities held by the UIT that issued them. Accordingly, the level of risk involved in the purchase or redemption or sale of a Domestic Equity Depositary Receipt is similar to the risk involved in the purchase or sale of traditional common stock, with the exception that the price of Domestic Equity Depositary Receipts is based on the value of a basket of stocks. Disruptions in the markets for the securities underlying Domestic Equity Depositary Receipts purchased or sold by the Fund could result in losses on Domestic Equity Depositary Receipts.

PURCHASE AND REDEMPTION OF SHARES

You may buy shares of the Fund through Evergreen Investment Services, Inc. (EIS), broker‑dealers that have entered into special agreements with EIS or certain other financial institutions. With certain exceptions, the Fund may offer up to eight different classes of shares that differ primarily with respect to sales charges and distribution fees. Depending upon the class of shares, you will pay a front-end sales charge when you buy the Fund's shares, a contingent deferred sales charge (CDSC) when you redeem the Fund's shares or no sales charges at all. Each Evergreen fund offers different classes of shares. Refer to the prospectus to determine which classes of shares are offered by each Fund.

Class A Shares

The Fund’s prospectus describes the sales charges applicable to purchases of Class A shares.

There is no front-end sales charge imposed on Class A shares of Evergreen’s money market funds. However, when exchanging from Class A shares of a money market fund to a non-money market fund within the Evergreen funds family, a sales charge will be imposed on the exchange, unless the shares have been subject to a previous sales charge.

In addition to the circumstances described in the prospectus, no front-end sales charges are imposed on Class A shares purchased by shareholders of record on October 12, 1990 in any series of Evergreen Investment Trust in existence on that date, and the members of their immediate families (as defined in the prospectus). As described in the prospectus, current and retired Directors, Trustees, officers and employees of the Evergreen funds and Wachovia Corporation and its affiliates, and members of each such individual’s immediate family, and employees of broker-dealer firms that have entered into dealer agreements with EIS, and members of each such individual’s immediate family, are eligible to purchase Class A shares at net asset value (NAV). Accounts opened while the individual (or his or her immediate family member) is in a position giving rise to these privileges will continue to have the privilege of purchasing Class A shares at NAV after termination of the position; however, accounts opened after termination of the position (in the absence of any other circumstances giving rise to the privilege to purchase Class A shares at NAV) will not be eligible for purchases of Class A shares at NAV. These provisions are generally intended to provide additional job-related incentives to persons who serve the Fund or work for companies associated with the Fund and selected dealers and agents of the Fund. Since these persons are in a position to have a basic understanding of the nature of an investment company as well as a general familiarity with the Fund, sales to these persons, as compared to sales in the normal channels of distribution, require substantially less sales effort. Similarly, these provisions extend the privilege of purchasing shares at NAV to certain classes of institutional investors who, because of their investment sophistication, can be expected to require significantly less than normal sales effort on the part of the Fund and EIS. Furthermore, the provisions allow the Fund to be competitive in the mutual fund industry, where similar allowances are common.

In addition, in connection with the terms of a merger, acquisition or exchange offer made under a plan of reorganization, Class A shares may be purchased at NAV by certain investors of acquired funds who remain investors in the Evergreen funds, including former Investor class shareholders of Undiscovered Managers Funds, former shareholders of two funds managed by Grantham, Mayo, Van Otterloo & Co. (the GMO Global Balanced Allocation Fund and the GMO Pelican Fund) and former shareholders of America’s Utility Fund.

Class B Shares

The Fund’s prospectus describes the sales charges applicable to purchases of Class B shares.

Class B shares that have been outstanding for eight years will automatically convert to Class A shares without imposition of a front‑end sales charge or exchange fee. Conversion of Class B shares represented by stock certificates will require the return of the stock certificate to Evergreen Service Company, LLC (ESC).

Class C Shares, Class I Shares (also referred to as Institutional Shares), Class R Shares, Class S Shares, Class S1 Shares, Administrative Shares, Institutional Service Shares, Investor Shares, Participant Shares, Reserve Shares and Resource Shares

The Fund’s prospectus describes, if applicable, the sales charges applicable to purchases of Class C shares, Class I shares (also referred to as Institutional shares), Class R shares, Class S shares, Class S1 shares, Administrative shares, Institutional Service shares, Investor shares, Participant shares, Reserve shares and Resource shares.

Contingent Deferred Sales Charge

The Fund charges a CDSC on certain share classes as reimbursement for certain expenses, such as commissions or shareholder servicing fees, that it has incurred in connection with the sale of its shares (see "Distribution Expenses Under Rule 12b-1” below). Administrative, Institutional, Institutional Service, Investor, Participant, Reserve and Resource shares do not charge a CDSC.

Redemption-in-kind

The Fund reserves the right, if conditions exist which make cash payments undesirable, to honor any request for redemption or repurchase order by making payment in whole or in part in readily marketable securities chosen by the Fund and valued as they are for purposes of computing the Fund's NAV (a redemption-in-kind). If payment is made in securities, a shareholder may incur transaction expenses in converting these securities to cash. The Trust has elected, however, to be governed by Rule 18f-1 under the 1940 Act, as a result of which the Fund is obligated to redeem shares, with respect to any one shareholder during any 90-day period, solely in cash up to the lesser of $250,000 or 1% of the Fund's NAV at the beginning of the period.

Exchanges

Investors may exchange shares of the Fund for shares of the same class of any other Evergreen fund which offers the same class of shares. See “By Exchange” under “How to Buy Shares” in the prospectus. Before you make an exchange, you should read the prospectus of the Evergreen fund into which you want to exchange. The Trust's Board of Trustees reserves the right to discontinue, alter or limit the exchange privilege at any time. There is no front-end sales charge imposed on Class A shares of Evergreen’s money market funds. However, when exchanging from Class A shares of a money market fund to a non-money market fund within the Evergreen funds family, a sales charge will be imposed on the exchange, unless the shares have been subject to a previous sales charge.

Automatic Reinvestment

As described in the prospectus, a shareholder may elect to receive dividends and capital gains distributions in cash instead of shares. However, ESC will automatically reinvest all dividends and distributions in additional shares when it learns that the postal or other delivery service is unable to deliver checks or transaction confirmations to the shareholder's address of record. When a check is returned, the Fund will hold the check amount in a no-interest account in the shareholder's name until the shareholder updates his or her address or automatic reinvestment begins. Uncashed or returned redemption checks will also be handled in the manner described above.

PRICING OF SHARES

Calculation of Net Asset Value

The Fund calculates its NAV once daily on Monday through Friday, as described in the prospectus. The Fund will not compute its NAV on the days the New York Stock Exchange is closed: New Year's Day, Martin Luther King, Jr. Day, Presidents' Day, Good Friday, Memorial Day, Independence Day, Labor Day, Thanksgiving Day and Christmas Day. Evergreen reserves the right to adjust the closing time to coincide with an earlier closing of the New York Stock Exchange or due to other unusual circumstances.

The NAV of the Fund is calculated by dividing the value of the Fund's net assets attributable to that class by all of the shares issued for that class.

Valuation of Portfolio Securities

Current values for the Fund's portfolio securities are determined as follows:

(1) Securities that are traded on an established securities exchange or the over-the-counter National Market System (NMS) are valued on the basis of the last sales price on the exchange where primarily traded or on the NMS prior to the time of the valuation, provided that a sale has occurred.

(2) Securities traded on an established securities exchange or in the over-the-counter market for which there has been no sale and other securities traded in the over-the-counter market are valued at the mean of the bid and asked prices at the time of valuation.

(3) Short-term investments maturing in more than 60 days, for which market quotations are readily available, are valued at current market value.

(4) Short-term investments maturing in sixty days or less are valued at amortized cost, which approximates market.

(5) Securities, including restricted securities, for which market quotations are not readily available; listed securities or those on NMS if, in the investment advisor’s opinion, the last sales price does not reflect an accurate current market value; and other assets are valued at prices deemed in good faith to be fair under procedures established by the Board of Trustees.

(6) Municipal bonds are valued by an independent pricing service at fair value using a variety of factors which may include yield, liquidity, interest rate risk, credit quality, coupon, maturity and type of issue.

Foreign securities are generally valued on the basis of valuations provided by a pricing service, approved by the Trust's Board of Trustees, which uses information with respect to transactions in such securities, quotations from broker-dealers, market transactions in comparable securities, and various relationships between securities and yield to maturity in determining value.

PRINCIPAL UNDERWRITER

EIS is the principal underwriter for the Trust and with respect to each class of shares of the Fund. The Trust has entered into a Principal Underwriting Agreement (Underwriting Agreement) with EIS with respect to each class of the Fund.

EIS, as agent, has agreed to use its best efforts to find purchasers for the shares. EIS may retain and employ representatives to promote distribution of the shares and may obtain orders from broker‑dealers, and others, acting as principals, for sales of shares to them. The Underwriting Agreement provides that EIS will bear the expense of preparing, printing, and distributing advertising and sales literature and prospectuses used by it.

All subscriptions and sales of shares by EIS are at the public offering price of the shares, which is determined in accordance with the provisions of the Trust's Declaration of Trust, By‑Laws, current prospectuses and SAI. All orders are subject to acceptance by the Fund and the Fund reserves the right, in its sole discretion, to reject any order received. Under the Underwriting Agreement, the Fund is not liable to anyone for failure to accept any order.

EIS has agreed that it will, in all respects, duly conform with all state and federal laws applicable to the sale of the shares. EIS has also agreed that it will indemnify and hold harmless the Trust and each person who has been, is, or may be a Trustee or officer of the Trust against expenses reasonably incurred by any of them in connection with any claim, action, suit, or proceeding to which any of them may be a party that arises out of or is alleged to arise out of any misrepresentation or omission to state a material fact on the part of EIS or any other person for whose acts EIS is responsible or is alleged to be responsible, unless such misrepresentation or omission was made in reliance upon written information furnished by the Trust.

The Underwriting Agreement provides that it will remain in effect as long as its terms and continuance are approved annually (i) by a vote of a majority of the Trust's Trustees who are not interested persons of the Fund, as defined in the 1940 Act (the “Independent Trustees”), and (ii) by vote of a majority of the Trust's Trustees, in each case, cast in person at a meeting called for that purpose.

The Underwriting Agreement may be terminated, without penalty, on 60 days' written notice by the Board of Trustees or by a vote of a majority of outstanding shares subject to such agreement. The Underwriting Agreement will terminate automatically upon its "assignment," as that term is defined in the 1940 Act.

From time to time, if, in EIS's judgment, it could benefit the sales of shares, EIS may provide to selected broker‑dealers promotional materials and selling aids.

DISTRIBUTION EXPENSES UNDER RULE 12b-1

The Fund bears some of the costs of selling its Class A, Class B, Class C, Class S, Class S1, Administrative, Institutional Service, Investor, Participant, Reserve, Resource and Class R shares (“Share Classes”), as applicable, including certain advertising, marketing and shareholder service expenses, pursuant to Rule 12b-1 of the 1940 Act. These 12b-1 fees are indirectly paid by the shareholder, as shown by the Fund’s expense table in the prospectus. The 12b-1 fees are composed of distribution fees and service fees which are described further below.

Under the Distribution Plans (each a “Plan,” together, the “Plans”) that the Fund has adopted for its Share Classes, other than Class I and Institutional, the Fund may incur expenses for 12b-1 fees up to a maximum annual percentage of the average daily net assets attributable to a class, as described below. Amounts paid under the Plans are used to compensate EIS pursuant to Distribution Agreements (each an “Agreement,” together, the “Agreements”) that the Fund has entered into with respect to its Share Classes, as applicable.

Class	Current Maximum 12b-1 Fees Allowed Under the Plans
A	0.75%(a)
B	1.00%
C	1.00%
S	0.75%(b)
S1	0.75%(b)
Administrative	0.75%(c)
Institutional Service	0.75%(d)
Investor	0.75%(e)
Participant	0.75%(f)
Reserve	0.75%(g)
Resource	1.00%(h)
R	1.00%(i)

Currently limited to 0.30% or less on Evergreen funds. Of this amount 0.25% is to be used exclusively as a service fee. See the expense table in the prospectus of the Fund in which you are interested.

Currently limited to 0.60% or less on Evergreen money market funds. Of this amount 0.25% is to be used exclusively as a service fee. See the expense table in the prospectus of the Fund in which you are interested.

Currently limited to 0.05% or less on Evergreen institutional money market funds. This amount is to be used exclusively as a service fee. See the expense table in the prospectus of the Fund in which you are interested.

Currently limited to 0.25% or less on Evergreen institutional money market funds. This amount is to be used exclusively as a service fee. See the expense table in the prospectus of the Fund in which you are interested.

Currently limited to 0.10% or less on Evergreen institutional money market funds. This amount is to be used exclusively as a service fee. See the expense table in the prospectus of the Fund in which you are interested.

Currently limited to 0.50% or less on Evergreen institutional money market funds. Of this amount 0.25% is to be used exclusively as a service fee. See the expense table in the prospectus of the Fund in which you are interested.

Currently limited to 0.65% or less on Evergreen institutional money market funds. Of this amount 0.25% is to be used exclusively as a service fee. See the expense table in the prospectus of the Fund in which you are interested.

Currently limited to 0.80% or less on Evergreen institutional money market funds and Evergreen Cash Management Money Market Fund. Of this amount 0.25% is to be used exclusively as a service fee. See the expense table in the prospectus of the Fund in which you are interested.

Currently limited to 0.50% or less on Evergreen funds. Of this amount 0.25% is to be used exclusively as a service fee. See the expense table in the prospectus of the Fund in which you are interested.

Of the amounts above, each class may pay under its Plan a maximum service fee of 0.25% to compensate organizations, which may include the Fund’s investment advisor or its affiliates, for personal services provided to shareholders and the maintenance of shareholder accounts. The Fund may not, during any fiscal period, pay 12b-1 fees greater than the amounts described in the chart above under “Current Maximum 12b-1 Fees Allowed Under the Plans.” The Trustees may, without shareholder approval, increase the fees allowed under the Agreements up to the current maximum 12b-1 fees allowed under the Plans.

The Agreements provide that EIS will use the distribution fees received from the Fund for the following purposes:

(1) to compensate broker-dealers or other persons for distributing Fund shares;

(2) to compensate broker-dealers, depository institutions and other financial intermediaries for providing administrative, accounting and other services with respect to the Fund’s shareholders; and

(3) to otherwise promote the sale of Fund shares.

The Agreements also provide that EIS may use distribution fees to make interest and principal payments in respect of amounts that have been financed to pay broker-dealers or other persons for distributing Fund shares. EIS may assign its rights to receive compensation under the Plans to secure such financings. Wachovia or its affiliates may finance payments made by EIS to compensate broker-dealers or other persons for distributing shares of the Fund.

In the event the Fund acquires the assets of another mutual fund, compensation paid to EIS under the Agreements may be paid by EIS to the acquired fund’s distributor or its predecessor.

Since EIS’s compensation under the Agreements is not directly tied to the expenses incurred by EIS, the compensation received by it under the Agreements during any fiscal year may be more or less than its actual expenses and may result in a profit to EIS. Distribution expenses incurred by EIS in one fiscal year that exceed the compensation paid to EIS for that year may be paid from distribution fees received from the Fund in subsequent fiscal years.

Distribution fees are accrued daily and paid at least annually on Class A, Class B, Class C, Class S, Class S1, Administrative, Institutional Service, Investor, Participant, Reserve, Resource and Class R shares and are charged as class expenses, as accrued. The distribution fees attributable to the Class B and Class C shares are designed to permit an investor to purchase such shares through broker‑dealers without the assessment of a front‑end sales charge, while at the same time permitting EIS to compensate broker‑dealers in connection with the sale of such shares.

Service fees are accrued daily and paid at least annually on Class A, Class B, Class C, Class S, Class S1, Administrative, Institutional Service, Investor, Participant, Reserve, Resource and Class R shares and are charged as class expenses, as accrued.

Under the Plans, the Treasurer of the Trust reports the amounts expended under the Plans and the purposes for which such expenditures were made to the Trustees of the Trust for their review on a quarterly basis. Also, each Plan provides that the selection and nomination of the Independent Trustees are committed to the discretion of such Independent Trustees then in office.

The investment advisor may from time to time from its own funds or such other resources as may be permitted by rules of the SEC make payments for distribution services to EIS; the latter may in turn pay part or all of such compensation to brokers or other persons for their distribution assistance.

Each Plan and the Agreement will continue in effect for successive 12‑month periods provided, however, that such continuance is specifically approved at least annually by the Trustees of the Trust or by vote of the holders of a majority of the outstanding voting securities of that class and, in either case, by a majority of the Independent Trustees of the Trust.

The Plans permit the payment of fees to brokers and others for distribution and shareholder‑related administrative services and to broker‑dealers, depository institutions, financial intermediaries and administrators for administrative services as to Class A, Class B, Class C, Class S, Class S1, Administrative, Institutional Service, Investor, Participant, Reserve, Resource and Class R shares. The Plans are designed to (i) stimulate brokers to provide distribution and administrative support services to the Fund and holders of Class A, Class B, Class C, Class S, Class S1 and Institutional Service shares and (ii) stimulate administrators to render administrative support services to the Fund and holders of Class A, Class B, Class C, Class S, Class S1, Administrative, Institutional Service, Investor, Participant, Reserve, Resource and Class R shares. The administrative services are provided by a representative who has knowledge of the shareholder's particular circumstances and goals, and include, but are not limited to providing office space, equipment, telephone facilities, and various personnel including clerical, supervisory, and computer, as necessary or beneficial to establish and maintain shareholder accounts and records; processing purchase and redemption transactions and automatic investments of client account cash balances; answering routine client inquiries regarding Class A, Class B, Class C, Class S, Class S1, Administrative, Institutional Service, Investor, Participant, Reserve, Resource and Class R shares; assisting clients in changing dividend options, account designations, and addresses; and providing such other services as the Fund reasonably requests for its Class A, Class B, Class C, Class S, Class S1, Administrative, Institutional Service, Investor, Participant, Reserve, Resource and Class R shares.

In the event that the Plan or Agreement is terminated or not continued with respect to one or more classes of the Fund, (i) no distribution fees (other than current amounts accrued but not yet paid) would be owed by the Fund to EIS with respect to that class or classes, and (ii) the Fund would not be obligated to pay EIS for any amounts expended under the Agreement not previously recovered by EIS from distribution services fees in respect of shares of such class or classes through deferred sales charges.

All material amendments to any Plan or Agreement must be approved by a vote of the Trustees of the Trust or the holders of the Fund's outstanding voting securities, voting separately by class, and in either case, by a majority of the Independent Trustees, cast in person at a meeting called for the purpose of voting on such approval; and any Plan or Agreement may not be amended in order to increase materially the costs that a particular class of shares of the Fund may bear pursuant to the Plan or Agreement without the approval of a majority of the holders of the outstanding voting shares of the class affected. Any Plan or Agreement may be terminated (i) by the Fund without penalty at any time by a majority vote of the holders of the outstanding voting securities of the Fund, voting separately by class or by a majority vote of the Independent Trustees, or (ii) by EIS. To terminate any Agreement, any party must give the other parties 60 days' written notice; to terminate a Plan only, the Fund need give no notice to EIS. Any Agreement will terminate automatically in the event of its assignment. For more information about 12b-1 fees, see “Expenses” in the prospectus and “12b-1 Fees” under “Expenses” in Part 1 of this SAI.

SERVICE FEES AND COMMISSIONS PAID TO INVESTMENT FIRMS

EIS will pay service fees to investment firms based on the average daily net asset value of Class A, Class B, Class C, Class S, Class S1, Administrative, Investor, Participant, Reserve, Resource, Institutional Service and Class R shares, as applicable, of a Fund which the investment firm has sold and which are issued and outstanding on the books of the Fund during each quarter, and which are registered in the names of customers for whom the investment firm is the dealer of record (“Eligible Shares”).

The rate of such service fees of a Fund for Class A and Institutional Service shares (excluding Evergreen money market funds, Evergreen Short-Intermediate Municipal Bond Fund, Evergreen Limited Duration Fund and Evergreen Short Intermediate Bond Fund) will be calculated quarterly at the rate of 0.0625% per quarter of the average daily net asset value of all such Eligible Shares (approximately 0.25% annually) during such quarter.

The rate of service fees of an Evergreen money market fund with Class A shares will be calculated quarterly at the rate of 0.075% per quarter of the average daily net asset value of such Eligible Shares (approximately 0.30% annually) during such quarter.

The rate of service fees of Evergreen Short-Intermediate Municipal Bond Fund, Evergreen Limited Duration Fund and Evergreen Short Intermediate Bond Fund for Class A shares will be calculated quarterly at the rate of 0.025% per quarter of the average daily net asset value of all such Eligible Shares (approximately 0.10% annually) during such quarter.

The rate of service fees of a Fund with Administrative Shares will be calculated quarterly at the rate of 0.0125% per quarter of the average daily net asset value of all such Eligible Shares (approximately 0.05% annually) during such quarter.

The rate of service fees of a Fund with Investor Shares will be calculated quarterly at the rate of 0.025% per quarter of the average daily net asset value of all such Eligible Shares (approximately 0.10% annually) during such quarter.

The rate of service fees of a Fund with Participant and Class R Shares will be calculated quarterly at the rate of 0.125% per quarter of the average daily net asset value of all such Eligible Shares (approximately 0.50% annually) during such quarter.

The rate of service fees of a Fund with Reserve Shares will be calculated quarterly at the rate of 0.1625% per quarter of the average daily net asset value of all such Eligible Shares (approximately 0.65% annually) during such quarter.

The rate of service fees of a Fund with Resource Shares will be calculated quarterly at the rate of 0.20% per quarter of the average daily net asset value of all such Eligible Shares (approximately 0.80% annually) during such quarter.

The rate of service fees of a Fund with Class S and Class S1 Shares will be calculated quarterly at the rate of 0.15% per quarter of the average daily net asset value of all such Eligible Shares (approximately 0.60% annually) during such quarter.

The amount of any service fee that exceeds 0.25% is considered an “asset-based sales charge” and is calculated into the appropriate maximum aggregate cap as specified in the rules of the National Association of Securities Dealers.

The rate of such service fees of a Fund for Class B shares will be calculated quarterly at the rate of 0.0625% per quarter of the average daily net asset value of all such Eligible Shares (approximately 0.25% annually) during such quarter.

EIS will pay service fees to investment firms based on the average daily net asset value of Class C shares of the Fund they have sold, provided such shares have been on the books of the Fund for a minimum of 13 months from the date of purchase (plus any reinvested distributions attributable to such shares), which have been issued and outstanding on the books of such Fund during the respective quarter and which are registered in the names of customers for whom the investment firm is the dealer of record (“Class C Eligible Shares”). Such service fees will be calculated quarterly at the rate of 0.0625% per quarter of the average daily net asset value of all such Class C Eligible Shares (approximately 0.25% annually).

In any quarter in which total service fees earned by the investment firm on such Eligible Shares of all Funds are less than $50.00 in the aggregate, no service fees will be paid to the investment firm nor will such amounts be carried over for payment in a future quarter. Service fees will be paid within five business days after the end of the service commission period in the respective quarter. EIS will pay service fees only to the extent that such amounts have been paid to EIS by the Fund.

No service fees are paid on sales of any Class I or Institutional shares of the Fund.

Commissions

EIS pays commissions to investment firms for sales of Class A shares at the following rates:

Equity Funds	Your Investment	Dealer Commission as a % of Offering Price
	Up to $49,999	5.00%
	$50,000-$99,999	4.25%
	$100,000-$249,999	3.25%
	$250,000-$499,999	2.00%
	$500,000-$999,999	1.75%
	$1,000,000-$2,999,999	1.00% of the first $2,999,999, plus
	$3,000,000-$4,999,999	0.50% of the next $2,000,000, plus
	$5,000,000 or greater	0.25% of amounts equal to or over $5,000,000*

* Evergreen Equity Index Fund pays 0.25% to investment firms for all amounts over $1,000,000.

Long-term Bond Funds	Your Investment	Dealer Commission as a % of Offering Price
	Up to $49,999	4.25%
	$50,000-$99,999	4.25%
	$100,000-$249,999	3.25%
	$250,000-$499,999	2.00%
	$500,000-$999,999	1.75%
	$1,000,000-$2,999,999	1.00% of the first $2,999,999, plus
	$3,000,000-$4,999,999	0.50% of the next $2,000,000, plus
	$5,000,000 or greater	0.25% of amounts equal to or over $5,000,000

Short-term Bond Funds	Your Investment	Dealer Commission as a % of Offering Price
	Up to $49,999	2.75%
	$50,000-$99,999	2.75%
	$100,000-$249,999	2.25%
	$250,000-$499,999	1.75%
	$500,000-$999,999	1.25%
	$1,000,000-$2,999,999	0.50% of the first $2,999,999, plus
	$3,000,000 or greater	0.25% of amounts equal to or over $3,000,000**

** Evergreen Adjustable Rate Fund and Evergreen Ultra Short Bond Fund pay 0.25% to investment firms for all amounts over $1,000,000.

EIS pays commissions, also referred to as a Dealer Allowance, to investment firms for sales of Class B shares in the amount of 4.00% of shares sold at the time of purchase.

EIS pays commissions to investment firms for sales of Class C shares in the amount of 1.00% of shares sold at the time of purchase.

EIS will also pay subsequent commissions to investment firms for sales of Class C shares based on the average daily net asset value of Class C shares of the Fund sold provided such shares have been on the books of the Fund for a minimum of 13 months from the date of purchase (plus any reinvested distributions attributable to such shares), which have been issued and outstanding on the books of such Fund during the calendar quarter and which are registered in the names of customers for whom the investment firm is the dealer of record (“Eligible Shares”). Such commissions will be calculated quarterly at the rate of 0.1875% per quarter of the average daily net asset value of all such Eligible Shares (approximately 0.75% annually) during such quarter. Such commissions will be paid by the twentieth day of the month before the end of the respective quarter. Such commissions will continue to be paid to the investment firm quarterly so long as aggregate payments do not exceed applicable NASD limitations and other governing regulations.

No commissions are paid on sales of any Class I, Administrative, Institutional Service, Investor, Participant, Reserve, Resource, Class R, Class S and Class S1 shares of a Fund.

TAX INFORMATION

Requirements for Qualifications as a Regulated Investment Company

The Fund intends to qualify for and elect the tax treatment applicable to a regulated investment company (RIC) under Subchapter M of the Code. (Such qualification does not involve supervision of management or investment practices or policies by the Internal Revenue Service.) In order to qualify as a RIC, the Fund must, among other things, (i) derive at least 90% of its gross income from dividends, interest, payments with respect to proceeds from securities loans, gains from the sale or other disposition of securities or foreign currencies and other income (including gains from options, futures or forward contracts) derived with respect to its business of investing in such securities, and net income from certain publicly traded partnerships; and (ii) diversify its holdings so that, at the end of each quarter of its taxable year, (a) at least 50% of the market value of the Fund's total assets is represented by cash, U.S. government securities, securities of other regulated investment companies, and other securities limited in respect of any one issuer, to an amount not greater than 5% of the Fund's total assets and 10% of the outstanding voting securities of such issuer, and (b) not more than 25% of the value of its total assets is invested in the securities of any one issuer (other than U.S. government securities and securities of other regulated investment companies), the securities of two or more issuers which the Fund controls and which are engaged in the same, similar or related trades or businesses, or in the securities of one or more publicly traded partnerships. By so qualifying, the Fund is not subject to federal income tax if it timely distributes its investment company taxable income and any net realized capital gains. A 4% nondeductible excise tax will be imposed on the Fund to the extent it does not meet certain distribution requirements by the end of each calendar year. The Fund anticipates meeting such distribution requirements.

Taxes on Distributions

Unless the Fund is a municipal bond or municipal money market fund, distributions will be taxable to shareholders whether made in shares or in cash. Shareholders electing to receive distributions in the form of additional shares will have a cost basis for federal income tax purposes in each share so received equal to the net asset value of a share of the Fund on the reinvestment date.

To calculate ordinary income for federal income tax purposes, shareholders must generally include dividends paid by the Fund from its investment company taxable income (net taxable investment income plus net realized short‑term capital gains, if any). The Fund will include dividends it receives from domestic corporations when the Fund calculates its gross investment income. Unless the Fund is a corporate, U.S. Treasury, U.S. Government or municipal bond fund or a money market fund, it anticipates that all or a portion of the ordinary dividends which it pays will qualify for the 70% dividends-received deduction for corporations and the 15% rate of tax for other taxpayers who have met the relevant holding period requirements The Fund will inform shareholders of the amounts that so qualify. If the Fund is a corporate, U.S. Treasury, U.S. Government or municipal bond fund or a money market fund, none of its income will consist of corporate dividends; therefore, none of its distributions will qualify for the 70% dividends-received deduction for corporations or the 15% rate of tax for other taxpayers.

From time to time, the Fund will distribute the excess of its net long‑term capital gains over its short‑term capital loss to shareholders (i.e., capital gain dividends). For federal tax purposes, shareholders must include such capital gain dividends when calculating their net long‑term capital gains. Capital gain dividends are taxable as net long-term capital gains to a shareholder, no matter how long the shareholder has held the shares.

Distributions by the Fund reduce its NAV. A distribution that reduces the Fund's NAV below a shareholder's cost basis is taxable as described above, although from an investment standpoint, it is a return of capital. In particular, if a shareholder buys Fund shares just before the Fund makes a distribution, when the Fund makes the distribution the shareholder will receive what is in effect a return of capital. Nevertheless, the shareholder may incur taxes on the distribution. Therefore, shareholders should carefully consider the tax consequences of buying Fund shares just before a distribution.

All distributions, whether received in shares or cash, must be reported by each shareholder on his or her federal income tax return. Each shareholder should consult a tax advisor to determine the state and local tax implications of Fund distributions.

If more than 50% of the value of the Fund's total assets at the end of a fiscal year is represented by securities of foreign corporations and the Fund elects to make foreign tax credits available to its shareholders, a shareholder will be required to include in his gross income both cash dividends and the amount the Fund advises him is his pro rata portion of income taxes withheld by foreign governments from interest and dividends paid on the Fund's investments. The shareholder may be entitled, however, to take the amount of such foreign taxes withheld as a credit against his U.S. income tax, or to treat the foreign tax withheld as an itemized deduction from his gross income, if that should be to his advantage. In substance, this policy enables the shareholder to benefit from the same foreign tax credit or deduction that he would have received if he had been the individual owner of foreign securities and had paid foreign income tax on the income therefrom. As in the case of individuals receiving income directly from foreign sources, the credit or deduction is subject to a number of limitations.

Special Tax Information for Shareholders of Municipal Bond or Municipal Money Market Funds

The Fund expects that substantially all of its dividends will be "exempt interest dividends," which should be treated as excludable from federal gross income. In order to pay exempt interest dividends, at least 50% of the value of the Fund's assets must consist of federally tax‑exempt obligations at the close of each quarter. An exempt interest dividend is any dividend or part thereof (other than a capital gain dividend) paid by the Fund with respect to its net federally excludable municipal obligation interest and designated as an exempt interest dividend in a written notice mailed to each shareholder not later than 60 days after the close of its taxable year. The percentage of the total dividends paid by the Fund with respect to any taxable year that qualifies as exempt interest dividends will be the same for all shareholders of the Fund receiving dividends with respect to such year. If a shareholder receives an exempt interest dividend with respect to any share and such share has been held for six months or less, any loss on the sale or exchange of such share will be disallowed to the extent of the exempt interest dividend amount.

Any shareholder of the Fund who may be a “substantial user” (as defined by the Code, as amended) of a facility financed with an issue of tax‑exempt obligations or a "related person" to such a user should consult his tax advisor concerning his qualification to receive exempt interest dividends should the Fund hold obligations financing such facility.

Under regulations to be promulgated, to the extent attributable to interest paid on certain private activity bonds, the Fund's exempt interest dividends, while otherwise tax‑exempt, will be treated as a tax preference item for alternative minimum tax purposes. Corporate shareholders should also be aware that the receipt of exempt interest dividends could subject them to alternative minimum tax under the provisions of Section 56(g) of the Code (relating to "adjusted current earnings").

Interest on indebtedness incurred or continued by shareholders to purchase or carry shares of the Fund will not be deductible for federal income tax purposes to the extent of the portion of the interest expense relating to exempt interest dividends. Such portion is determined by multiplying the total amount of interest paid or accrued on the indebtedness by a fraction, the numerator of which is the exempt interest dividends received by a shareholder in his taxable year and the denominator of which is the sum of the exempt interest dividends and the taxable distributions out of the Fund's investment income and long‑term capital gains received by the shareholder.

Taxes on the Sale or Exchange of Fund Shares

Upon a sale or exchange of Fund shares, a shareholder will realize a taxable gain or loss depending on his or her basis in the shares. A shareholder must treat such gains or losses as a capital gain or loss if the shareholder held the shares as capital assets. Capital gain on assets held for more than 12 months is generally subject to a maximum federal income tax rate of 15% for an individual. Generally, the Code will not allow a shareholder to realize a loss on shares he or she has sold or exchanged and replaced within a 61-day period beginning 30 days before and ending 30 days after he or she sold or exchanged the shares. The Code will not allow a shareholder to realize a loss on the sale of Fund shares held by the shareholder for six months or less to the extent the shareholder received exempt interest dividends on such shares. Moreover, the Code will treat a shareholder's loss on shares held for six months or less as a long‑term capital loss to the extent the shareholder received distributions of net capital gains on such shares.

Shareholders who fail to furnish their taxpayer identification numbers to the Fund and to certify as to its correctness and certain other shareholders may be subject to a federal income tax backup withholding requirement at the rate of 28% on dividends, distributions of capital gains and redemption proceeds paid to them by the Fund. If the withholding provisions are applicable, any such dividends or capital gain distributions to these shareholders, whether taken in cash or reinvested in additional shares, and any redemption proceeds will be reduced by the amounts required to be withheld. Investors may wish to consult their own tax advisors about the applicability of the backup withholding provisions.

Other Tax Considerations

The foregoing discussion relates solely to U.S. federal income tax law as applicable to U.S. persons (i.e., U.S. citizens and residents and U.S. domestic corporations, partnerships, trusts and estates). It does not reflect the special tax consequences to certain taxpayers (e.g., banks, insurance companies, tax exempt organizations and foreign persons). Shareholders are encouraged to consult their own tax advisors regarding specific questions relating to federal, state and local tax consequences of investing in shares of the Fund. Each shareholder who is not a U.S. person should consult his or her tax advisor regarding the U.S. and foreign tax consequences of ownership of shares of the Fund. The Fund will withhold a tax at a rate of 30% (or lower under a tax treaty) on all ordinary dividend distributions to non-U.S. persons. Under recent legislation, the withholding obligation generally does not apply to properly designated dividends derived from certain interest income of the Fund or from short-term capital gains of the Fund which are paid with respect to Fund years beginning after December 31, 2004 and before January 1, 2008. The Fund does not intend to make the designations that would be required to take advantage of this provision. Consequently, all dividend distributions to non-U.S. persons will be subject to withholding.

BROKERAGE

Brokerage Commissions

If the Fund invests in equity securities, it expects to buy and sell them through brokerage transactions for which commissions are payable. Purchases from underwriters will include the underwriting commission or concession, and purchases from dealers serving as market makers will include a dealer's mark-up or reflect a dealer's mark-down. Where transactions are made in the over-the-counter market, the Fund will deal with primary market makers unless more favorable prices are otherwise obtainable.

If the Fund invests in fixed income securities, it expects to buy and sell them directly from the issuer or an underwriter or market maker for the securities. Generally, the Fund will not pay brokerage commissions for such purchases. When the Fund buys a security from an underwriter, the purchase price will usually include an underwriting commission or concession. The purchase price for securities bought from dealers serving as market makers will similarly include the dealer's mark up or reflect a dealer's mark down. When the Fund executes transactions in the over‑the‑counter market, it will deal with primary market makers unless more favorable prices are otherwise obtainable.

Selection of Brokers

When buying and selling portfolio securities, the advisor seeks brokers who can provide the most benefit to the Fund. When selecting a broker, the investment advisor will primarily look for the best price at the lowest commission, but in the context of the broker’s:

1. ability to provide the best net financial result to the Fund;

2. efficiency in handling trades;

3. ability to trade large blocks of securities;

4. readiness to handle difficult trades;

5. financial strength and stability; and

6. provision of “research services,” defined as (a) reports and analyses concerning issuers, industries, securities and economic factors and (b) other information useful in making investment decisions.

The Fund may pay higher brokerage commissions to a broker providing it with research services, as defined in item 6, above, including Wachovia Securities, LLC, an affiliate of the Fund’s investment advisor. Pursuant to Section 28(e) of the Securities Exchange Act of 1934, this practice is permitted if the commission is reasonable in relation to the brokerage and research services provided. Research services provided by a broker to the investment advisor do not replace, but supplement, the services the investment advisor is required to deliver to the Fund. It is impracticable for the investment advisor to allocate the cost, value and specific application of such research services among its clients because research services intended for one client may indirectly benefit another.

When selecting a broker for portfolio trades, the investment advisor may not consider the amount of Fund shares a broker has sold.

Wachovia Securities, LLC, an affiliate of the Fund’s investment advisor and a member of the New York and American Stock Exchanges, may effect portfolio transactions on those exchanges for the Fund. Wachovia Securities, LLC, is a majority-owned subsidiary of Wachovia Corporation, the Fund’s investment advisor’s parent.

Simultaneous Transactions

The investment advisor makes investment decisions for the Fund independently of decisions made for its other clients. When a security is suitable for the investment objective of more than one client, it may be prudent for the investment advisor to engage in a simultaneous transaction, that is, buy or sell the same security for more than one client. The investment advisor strives for an equitable result in such transactions by using an allocation formula. The high volume involved in some simultaneous transactions can result in greater value to the Fund, but the ideal price or trading volume may not always be achieved for the Fund.

ORGANIZATION

The following is qualified in its entirety by reference to the Trust’s Declaration of Trust.

Description of Shares

The Declaration of Trust authorizes the issuance of an unlimited number of shares of beneficial interest of series and classes of shares. Each share of the Fund represents an equal proportionate interest with each other share of that series and/or class. Upon liquidation, shares are entitled to a pro rata share of the Trust based on the relative net assets of each series and/or class. Shareholders have no preemptive or conversion rights. Shares are redeemable and transferable.

Voting Rights

Under the terms of the Declaration of Trust, the Trust is not required to hold annual meetings. At meetings called for the initial election of Trustees or to consider other matters, each share is entitled to one vote for each dollar of “NAV” applicable to such share. Shares generally vote together as one class on all matters. Classes of shares of the Fund have equal voting rights. No amendment may be made to the Declaration of Trust that adversely affects any class of shares without the approval of a majority of the votes applicable to the shares of that class. Shares have non‑cumulative voting rights, which means that the holders of more than 50% of the votes applicable to shares voting for the election of Trustees can elect 100% of the Trustees to be elected at a meeting and, in such event, the holders of the remaining shares voting will not be able to elect any Trustees.

After the initial meeting as described above, no further meetings of shareholders for the purpose of electing Trustees will be held, unless required by law (for such reasons as electing or removing Trustees, changing fundamental policies, and approving advisory agreements or 12b-1 plans), unless and until such time as less than a majority of the Trustees holding office have been elected by shareholders, at which time, the Trustees then in office will call a shareholders' meeting for the election of Trustees.

Limitation of Trustees' Liability

The Declaration of Trust provides that a Trustee will not be liable for errors of judgment or mistakes of fact or law, but nothing in the Declaration of Trust protects a Trustee against any liability to which he would otherwise be subject by reason of willful misfeasance, bad faith, gross negligence or reckless disregard of his duties involved in the conduct of his office.

Code of Ethics

The Trust, its principal underwriter and its various investment advisors have each adopted a code of ethics pursuant to the requirements of Rule 17j-1 of the 1940 Act (“Code of Ethics”). Each of these Codes of Ethics permits Fund personnel to invest in securities for their own accounts and is on file with, and available from, the SEC.

INVESTMENT ADVISORY AGREEMENT

On behalf of the Fund, the Trust has entered into an investment advisory agreement with the Fund’s investment advisor (the "Advisory Agreement"). Under the Advisory Agreement, and subject to the supervision of the Trust's Board of Trustees, the investment advisor furnishes to the Fund investment advisory, management and administrative services, office facilities, and equipment in connection with its services for managing the investment and reinvestment of the Fund's assets. The investment advisor pays for all of the expenses incurred in connection with the provision of its services.

The Fund pays for all charges and expenses, other than those specifically referred to as being borne by the investment advisor, including, but not limited to, (1) custodian charges and expenses; (2) bookkeeping and auditors' charges and expenses; (3) transfer agent charges and expenses; (4) fees and expenses of Independent Trustees; (5) brokerage commissions, brokers' fees and expenses; (6) issue and transfer taxes; (7) applicable costs and expenses under the Distribution Plan (as described above) (8) taxes and trust fees payable to governmental agencies; (9) the cost of share certificates; (10) fees and expenses of the registration and qualification of the Fund and its shares with the SEC or under state or other securities laws; (11) expenses of preparing, printing and mailing prospectuses, SAIs, notices, reports and proxy materials to shareholders of the Fund; (12) expenses of shareholders' and Trustees' meetings; (13) charges and expenses of legal counsel for the Fund and for the Independent Trustees on matters relating to the Fund; (14) charges and expenses of filing annual and other reports with the SEC and other authorities; and (15) all extraordinary charges and expenses of the Fund. For information on advisory fees paid by the Fund, see “Expenses” in Part 1 of this SAI.

The Advisory Agreement continues in effect for two years from its effective date and, thereafter, from year to year only if approved at least annually by the Board of Trustees of the Trust or by a vote of a majority of the Fund's outstanding shares. In either case, the terms of the Advisory Agreement and continuance thereof must be approved by the vote of a majority of the Independent Trustees cast in person at a meeting called for the purpose of voting on such approval. The Advisory Agreement may be terminated, without penalty, on 60 days' written notice by the Trust's Board of Trustees or by a vote of a majority of outstanding shares. The Advisory Agreement will terminate automatically upon its "assignment" as that term is defined in the 1940 Act.

In approving the renewal of the existing investment advisory agreement of each Fund, the Board of Trustees reviewed, on a Fund-by-Fund basis, the management fees and other expenses and compared the data to that of Funds of comparable size and investment objectives in the Lipper peer group. In addition, the Board of Trustees considered its discussions with management on the personnel and resources committed to management of the Fund and the nature and quality of the service provided to the Fund. In reviewing the overall profitability of the management fee to the Fund’s investment advisor, the Board of Trustees also considered the fact that affiliates provide transfer agency and administrative services to the Fund for which they receive compensation.

After reviewing a variety of factors, such as those described above, the Trustees concluded that the service provided by the investment advisor was sufficient and met the terms of the contract, and that the fees were reasonable and consistent with industry norms for funds of comparable size and asset class.

Transactions Among Advisory Affiliates

The Trust has adopted procedures pursuant to Rule 17a‑7 of the 1940 Act ("Rule 17a‑7 Procedures"). The Rule 17a‑7 Procedures permit the Fund to buy or sell securities from another investment company for which a subsidiary of Wachovia Corporation is an investment advisor. The Rule 17a‑7 Procedures also allow the Fund to buy or sell securities from other advisory clients for whom a subsidiary of Wachovia Corporation is an investment advisor. The Fund may engage in such transaction if it is equitable to each participant and consistent with each participant's investment objective.

MANAGEMENT OF THE TRUST

The Trust is supervised by a Board of Trustees that is responsible for representing the interests of shareholders. The Trustees meet periodically throughout the year to oversee the Fund’s activities, reviewing, among other things, the Fund’s performance and its contractual arrangements with various service providers. Each Trustee is paid a fee for his or her services. See “Expenses-Trustee Compensation” in Part 1 of this SAI.

The Trust has an Executive Committee which consists of K. Dun Gifford, Dr. Russell A. Salton, III and the Chairman of the Board, Michael S. Scofield, each of whom is an Independent Trustee. The Executive Committee recommends Trustees to fill vacancies, prepares the agenda for Board Meetings, acts on routine matters between scheduled Board meetings and reviews and resolves conflicts of interest between the Fund and the Fund's investment advisor or its affiliates. The Executive Committee also functions as the Nominating Committee, the 15(c) Committee and the Qualified Legal Compliance Committee. For the fiscal year ended January 31, 2005, the Executive Committee held 19 committee meetings.

The Nominating Committee is responsible for nominating candidates for election to the Board of Trustees by the full Board. The Committee may solicit suggestions for persons to fill vacancies on the Boards of Trustees from such sources as it deems appropriate, including EIMC. The Committee will consider nominations for openings on the Board of Trustees from shareholders who have separately or as a group held for at least one full year at least 5% of the outstanding shares of a Fund. Shareholder recommendations should be sent to the attention of the Committee in care of the Fund’s Secretary and should include biographical information, including the proposed nominee’s business experience for the past ten years and a description of the qualifications of the proposed nominee, along with a statement from the proposed nominee that he or she is willing to serve and meets the requirements to be an Independent Trustee, if applicable.

The 15(c) Committee is responsible for gathering relevant information to assist the full Board in fulfilling its obligations relating to the initial approval and renewal of advisory and distribution contracts pursuant to Section 15 of the 1940 Act. It may request information from and submit questions to the Fund's investment advisor and its affiliates in order for the full Board of Trustees to determine whether or not to enter into or renew Fund contracts.

The Qualified Legal Compliance Committee is responsible for the establishment of written procedures for the confidential receipt, retention and consideration of any report of evidence of a material violation of an applicable U.S. federal or state securities law, a material breach of a fiduciary duty arising under U.S. federal or state law, or a similar material violation of any U.S. federal or state law by a Fund or by any officer, Trustee , employee or agent of a Fund. The Committee is also responsible for determining whether an investigation is necessary regarding any report of evidence of a material violation. If it is determined that there has been a material violation, the Committee is responsible for informing the Fund’s chief legal officer and chief executive officer and taking all other appropriate actions to respond to evidence of a material violation.

The Trust has an Audit Committee which consists of Shirley L. Fulton, K. Dun Gifford, Gerald M. McDonnell, William W. Pettit and the Chairman of the Committee, Charles A. Austin III, each of whom is an Independent Trustee. The purpose of the Audit Committee is to evaluate financial management, meet with the auditors and deal with other matters of a financial nature that it deems appropriate. For the fiscal year ended January 31, 2005, the Audit Committee held 5 committee meetings.

The Trust has a Distribution and Shareholder Service Committee which consists of Dr. Leroy Keith, David Richardson, Gerald McDonnell and the Chairman of the Committee, Richard Wagoner. The Distribution and Shareholder Service Committee oversees and assists Trustee oversight of: the means by which shares of the Evergreen funds are marketed and sold, expenditures by the Funds’ distributor of amounts paid under the Funds’ Rule 12b-1 plans, the nature and quality of services provided by the Funds’ transfer agent, and the overall level of servicing provided to shareholders in the Funds. The Distribution and Shareholder Service Committee, which was formed on March 16, 2005, did not meet during the fiscal year ended January 31, 2005.

The Trust has a Litigation Oversight Committee which consists of the members of the Executive Committee, Shirley L. Fulton and William W. Pettit. The Litigation Oversight Committee oversees and assists Trustee oversight of: litigation commenced by or against the Evergreen funds; litigation commenced by or against any service provider to the Funds that relates to the Funds or that may have a material effect on the service provider’s ability to perform its services to the Funds; non-routine regulatory actions, examinations, inspections, or other activities in respect of any service provider to the Funds that relate to its services to the Funds or that may have a material effect on the service provider’s ability to perform its services to the Funds. The Litigation Oversight Committee, which was formed on March 16, 2005, did not meet during the fiscal year ended January 31, 2005.

The Trust has a Performance Committee which consists of Dr. Russell A. Salton, III, Dr. Leroy Keith, David M. Richardson, Richard Wagoner and the Chairman of the Committee, Richard J. Shima. The Performance Committee reviews all activities involving investment-related issues and activities of EIMC and any sub-advisors to the Evergreen funds and assesses the performance of the Evergreen funds. For the fiscal year ended January 31, 2005, the Performance Committee held 4 committee meetings.

The Trust has a Pricing Committee which consists of the members of the Executive Committee and the Chairman of the Audit Committee. In furtherance of the Board’s responsibilities under the 1940 Act to determine in good faith the fair value of securities and assets for which market quotations are not readily available or are not reliable, the Pricing Committee is responsible for reviewing issues and activities relating to pricing. For the fiscal year ended January 31, 2005, the Pricing Committee held 5 committee meetings.

Set forth below are the Trustees of each of the twelve Evergreen Trusts. Unless otherwise indicated, the address for each Trustee is P.O. Box 20083, Charlotte, North Carolina 28202. All shareholder communications should be sent to this address.

Independent Trustees:

Name and Date of Birth	Position with Trust	Beginning Year of Term of Office¹	Principal Occupations for Last Five Years	Number of Portfolios Overseen in Evergreen Funds Complex as of 12/31/2004	Other Directorships held outside of Evergreen Funds Complex
Charles A. Austin III DOB: 10/23/1934	Trustee	1991	Investment Counselor, Anchor Capital Advisors, Inc. (investment advice); Director, The Andover Companies (insurance); Trustee, Arthritis Foundation of New England; Director, The Francis Ouimet Society; Former Director, Health Development Corp. (fitness-wellness centers); Former Director, Mentor Income Fund, Inc.; Former Trustee, Mentor Funds and Cash Resource Trust; Former Investment Counselor, Appleton Partners, Inc. (investment advice); Former Director, Executive Vice President and Treasurer, State Street Research & Management Company (investment advice)	93	None
Shirley L. Fulton DOB: 1/10/1952	Trustee	2004	Partner, Tin, Fulton, Greene & Owen, PLLC (law firm); Former Partner, Helms, Henderson & Fulton, P.A. (law firm); Retired Senior Resident Superior Court Judge, 26th Judicial District, Charlotte, NC	93	None
K. Dun Gifford DOB: 10/23/1938	Trustee	1974	Chairman and President, Oldways Preservation and Exchange Trust (education); Trustee, Treasurer and Chairman of the Finance Committee, Cambridge College; Former Chairman of the Board, Director, and Executive Vice President, The London Harness Company (leather goods purveyor); Former Director, Mentor Income Fund, Inc.; Former Trustee, Mentor Funds and Cash Resource Trust	93	None
Dr. Leroy Keith, Jr. DOB: 2/14/1939	Trustee	1983	Partner, Stonington Partners, Inc. (private equity firm); Trustee, The Phoenix Group of Mutual Funds; Director, Obagi Medical Products Co.; Director, Diversapack Co.; Former Director, Lincoln Educational Services; Former Chairman of the Board and Chief Executive Officer, Carson Products Company (manufacturing); Former Director, Mentor Income Fund, Inc.; Former Trustee, Mentor Funds and Cash Resource Trust	93	Trustee, The Phoenix Group of Mutual Funds
Gerald M. McDonnell DOB: 7/14/1939	Trustee	1988	Manager of Commercial Operations, SMI Steel Co. - South Carolina (steel producer); Former Sales and Marketing Manager, Nucor Steel Company; Former Director, Mentor Income Fund, Inc.; Former Trustee, Mentor Funds and Cash Resource Trust	93	None
William Walt Pettit DOB: 8/26/1955	Trustee	1984	Vice President, Kellam & Pettit, P.A. (law firm); Director, Superior Packaging Corp.; Director, National Kidney Foundation of North Carolina, Inc.; Former Director, Mentor Income Fund, Inc.; Former Trustee, Mentor Funds and Cash Resource Trust	93	None
David M. Richardson DOB: 9/19/1941	Trustee	1982	President, Richardson, Runden LLC (executive recruitment business development/consulting company); Consultant, Kennedy Information, Inc. (executive recruitment information and research company); Consultant, AESC (The Association of Executive Search Consultants); Director, J&M Cumming Paper Co. (paper merchandising); Former Trustee, NDI Technologies, LLP (communications); Former Vice Chairman, DHR International, Inc. (executive recruitment); Former Director, Mentor Income Fund, Inc.; Former Trustee, Mentor Funds and Cash Resource Trust	93	None
Dr. Russell A. Salton, III DOB: 6/2/1947	Trustee	1984	President/CEO, AccessOne MedCard; Former Medical Director, Healthcare Resource Associates, Inc.; Former Medical Director, U.S. Health Care/Aetna Health Services; Former Director, Mentor Income Fund, Inc.; Former Trustee, Mentor Funds and Cash Resource Trust	93	None
Michael S. Scofield DOB: 2/20/1943	Trustee	1984	Director, Branded Media Corporation (multi-media branding company); Attorney, Law Offices of Michael S. Scofield; Former Director, Mentor Income Fund, Inc.; Former Trustee, Mentor Funds and Cash Resource Trust	93	None
Richard J. Shima DOB: 8/11/1939	Trustee	1993	Independent Consultant; Director, Trust Company of CT; Trustee, Saint Joseph College (CT); Director, Hartford Hospital; Trustee, Greater Hartford YMCA; Former Director, Enhance Financial Services, Inc.; Former Director, Old State House Association; Former Director of CTG Resources, Inc. (natural gas); Former Director, Mentor Income Fund, Inc.; Former Trustee, Mentor Funds and Cash Resource Trust	93	None

Interested Trustee:

Richard K. Wagoner, CFA²

DOB: 12/12/1937

Trustee

1999

Member and Former President, North Carolina Securities Traders Association; Member, Financial Analysts Society; Former Consultant to the Boards of Trustees of the Evergreen funds; Former Trustee, Mentor Funds and Cash Resource Trust

None

¹ Each Trustee, except Ms. Fulton, serves until a successor is duly elected or qualified or until his death, resignation,retirement or removal from office. As a new Trustee, Ms. Fulton's initial term ends March 31, 2007 at which time she may be re-elected by Trustees to serve until her death, resignation, retirement or removal from office by the Trustees.

² Mr. Wagoner is an "interested person" of the Evergreen funds because of his ownership of shares in Wachovia Corporation, the parent to the Evergreen funds' investment advisor.

Trustee Ownership of Evergreen Funds Shares

Set forth in the table below are the names of the Evergreen funds in which the Trustees are invested through direct ownership of fund shares or through the Trustees’ Deferred Compensation Plan. The table shows the dollar range of each Trustee’s investment in each Fund and the aggregate dollar range of their investment in the Evergreen fund complex, as of December 31, 2004.

	Trustee	Fund	Dollar Range of Investment in Fund	Aggregate Dollar Range of Investments in Evergreen Funds Complex
	Charles A. Austin III	Evergreen Aggressive Growth Fund¹	$50,001-$100,000	Over $100,000
		Evergreen Core Bond Fund¹	$10,001-$50,000
		Evergreen Equity Income Fund¹	$10,001-$50,000
		Evergreen Growth Fund¹	$50,001-$100,000
		Evergreen Health Care Fund²	Over $100,000
		Evergreen Large Cap Value Fund¹	$10,001-$50,000
		Evergreen Mid Cap Growth Fund¹	$50,001-$100,000
		Evergreen Money Market Fund	$50,001-$100,000
		Evergreen Omega Fund²	$50,001-$100,000
		Evergreen Technology Fund	$1-$10,000
	Shirley L. Fulton	Evergreen Asset Allocation¹	$1-$10,000	$10,001-$50,000
		Evergreen Equity Income Fund¹	$1-$10,000
		Evergreen Mid Cap Growth Fund¹	$1-$10,000
		Evergreen Utility and Telecommunications Fund¹	$10,001-$50,000
	K. Dun Gifford	Evergreen Fundamental Large Cap Fund (formerly Evergreen Growth and Income Fund)	$10,001-$50,000	$10,001-$50,000
	K. Dun Gifford	Evergreen Health Care Fund	$10,001-$50,000	$10,001-$50,000
	Dr. Leroy Keith, Jr.	Evergreen Limited Duration Fund	$10,001-$50,000	$10,001-$50,000
	Dr. Leroy Keith, Jr.	Evergreen Omega Fund	$1-$10,000	$10,001-$50,000
	Gerald M. McDonnell³	Evergreen Adjustable Rate Fund	$10,001-$50,000	Over $100,000
		Evergreen Asset Allocation Fund¹	$50,001-$100,000
		Evergreen Emerging Markets Growth Fund	$10,001-$50,000
		Evergreen Equity Income Fund	$10,001-$50,000
		Evergreen Fund¹	$50,001-$100,000
		Evergreen Foundation Fund¹	$50,001-$100,000
		Evergreen Global Large Cap Equity Fund¹	$10,001-$50,000
		Evergreen Fundamental Large Cap Fund (formerly Evergreen Growth and Income Fund)	$10,001-$50,000
		Evergreen Health Care Fund	$1-$10,000
		Evergreen Income Advantage Fund	$1-$10,000
		Evergreen Large Cap Value Fund¹	$50,001-$100,000
		Evergreen Managed Income Fund	$1-$10,000
		Evergreen Money Market Fund¹	$10,001-$50,000
		Evergreen Omega Fund¹	$10,001-$50,000
		Evergreen Short Intermediate Bond Fund	$1-$10,000
		Evergreen Strategic Municipal Bond Fund	$10,001-$50,000
		Evergreen Technology Fund	$1-$10,000
		Evergreen Utilities and High Income Fund	$1-$10,000
	William Walt Pettit	Evergreen Aggressive Growth Fund²	Over $100,000	Over $100,000
		Evergreen Asset Allocation Fund¹	$10,001-$50,000
		Evergreen Emerging Markets Growth Fund	$1-$10,000
		Evergreen Equity Income Fund²	$10,001-$50,000
		Evergreen Fund¹	$50,001-$100,000
		Evergreen Foundation Fund¹	$10,001-$50,000
		Evergreen Global Large Cap Equity Fund²	$10,001-$50,000
		Evergreen Global Opportunities Fund¹	$10,001-$50,000
		Evergreen Growth Fund¹	Over $100,000
		Evergreen Fundamental Large Cap Fund (formerly Evergreen Growth and Income Fund)	$10,001-$50,000
		Evergreen Health Care Fund¹	Over $100,000
		Evergreen International Equity Fund¹	Over $100,000
		Evergreen Large Cap Value Fund¹	$10,001-$50,000
		Evergreen Masters Fund¹	$10,001-$50,000
		Evergreen Mid Cap Growth Fund¹	$1-$10,000
		Evergreen Money Market Fund	$10,001-$50,000
		Evergreen Omega Fund¹	Over $100,000
		Evergreen Strategic Growth Fund¹	$1-$10,000
		Evergreen Utility and Telecommunications Fund¹	$50,001-$100,000
	David M. Richardson	Evergreen Asset Allocation Fund	$10,001-$50,000	Over $100,000
		Evergreen Equity Index Fund	$10,001-$50,000
		Evergreen Managed Income Fund	$10,001-$50,000
		Evergreen Omega Fund	$10,001-$50,000
		Evergreen Utilities and High Income Fund	$10,001-$50,000
	Dr. Russell A. Salton, III	Evergreen Asset Allocation Fund¹	Over $100,000	Over $100,000
		Evergreen Global Opportunities Fund¹	Over $100,000
		Evergreen Large Cap Value Fund¹	Over $100,000
	Michael S. Scofield	Evergreen Aggressive Growth Fund	$10,001-$50,000	Over $100,000
		Evergreen Balanced Fund	$10,001-$50,000
		Evergreen Core Bond Fund²	Over $100,000
		Evergreen Equity Income Fund	$1-$10,000
		Evergreen Equity Index Fund	$10,001-$50,000
		Evergreen Foundation Fund¹	Over $100,000
		Evergreen Income Advantage Fund	$1-$10,000
		Evergreen Managed Income Fund	$1-$10,000
		Evergreen Omega Fund	$10,001-$50,000
		Evergreen Short Intermediate Bond Fund	$10,001-$50,000
		Evergreen Treasury Money Market Fund	Over $100,000
Richard J. Shima		Evergreen Asset Allocation Fund¹	$50,001-$100,000	Over $100,000
		Evergreen Connecticut Municipal Bond Fund	$50,001-$100,000
		Evergreen Global Large Cap Equity Fund	Over $100,000
		Evergreen Global Opportunities Fund	Over $100,000
		Evergreen Income Advantage Fund	$10,001-$50,000
		Evergreen International Equity Fund	$10,001-$50,000
		Evergreen Large Cap Value Fund¹	$50,001-$100,000
		Evergreen Managed Income Fund	$10,001-$50,000
		Evergreen Omega Fund	$50,001-$100,000
		Evergreen Tax Strategic Foundation Fund	$50,001-$100,000
		Evergreen Utilities and High Income Fund	$10,001-$50,000
Richard K. Wagoner		Evergreen Equity Income Fund	Over $100,000	Over $100,000
		Evergreen Income Advantage Fund	$1-$10,000
		Evergreen Managed Income Fund	$1-$10,000
		Evergreen Mid Cap Growth Fund	$50,001-$100,000
		Evergreen Money Market Fund	$10,001-$50,000
		Evergreen Municipal Money Market Fund	$10,001-$50,000
		Evergreen Omega Fund	Over $100,000
		Evergreen Special Values Fund	Over $100,000
		Evergreen Utilities and High Income Fund	$1-$10,000

¹ Invested through the Trustees’ Deferred Compensation Plan. The Deferred Compensation Plan allows each Trustee to defer any or all of his or her compensation for serving as Trustee, and to have such compensation invested into a deferral account. The investment performance of the deferral account is based on the investment performance of the particular Evergreen fund(s) selected by the Trustee.

² Amount shown includes direct investments as well as investments through the Trustees' Deferred Compensation Plan. Dollar ranges of investments held directly in these funds are as follows: Mr. Austin – Evergreen Health Care Fund, $10,001 - $50,000; Evergreen Omega Fund, $10,001 - $50,000. Mr. Pettit – Evergreen Aggressive Growth Fund, $1 - $10,000; Evergreen Equity Income Fund, $1 - $10,000; Evergreen Global Large Cap Equity Fund, $1 - $10,000. Mr. Scofield – Evergreen Core Bond Fund, $50,001 - $100,000.

³ In addition to the amounts shown in the table, Mr. McDonnell has $10,001-$50,000 invested in a 529 Education Savings Plan which may from time to time invest in certain of the Evergreen funds.

Set forth below are the officers of each of the twelve Evergreen Trusts.

Name, Address and Date of Birth	Position with Trust	Principal Occupation for Last Five Years
Dennis H. Ferro 401 S. Tryon Charlotte, NC 28288 DOB: 6/20/1945	President since 2003	President and Chief Executive Officer, Evergreen Investment Company, Inc. and Executive Vice President, Wachovia Bank, N.A.; former Chief Investment Officer, Evergreen Investment Company, Inc.
Carol Kosel 200 Berkeley Street Boston, MA 02116 DOB: 12/25/1963	Treasurer since 1999	Senior Vice President, Evergreen Investment Services, Inc.
Michael H. Koonce 200 Berkeley Street Boston, MA 02116 DOB: 4/20/1960	Secretary since 2000	Senior Vice President and General Counsel, Evergreen Investment Services, Inc.; Senior Vice President and Assistant General Counsel, Wachovia Corporation
James Angelos 200 Berkeley Street Boston, MA 02116 DOB: 9/2/47	Chief Compliance Officer since 2004	Chief Compliance Officer and Senior Vice President, Evergreen Funds; Former Director of Compliance, Evergreen Investment Services, Inc.

POLICY FOR DISSEMINATION OF PORTFOLIO HOLDINGS

A complete listing of portfolio holdings for every Fund as of the calendar quarter end will be available to the public approximately 15 calendar days after the calendar quarter end. Such listing to be posted to EvergreenInvestments.com as soon after the 15 days as possible. In addition, certain Funds (such as Evergreen money market funds) may make available to the public a complete list of holdings as of month end, posted to EvergreenInvestments.com within approximately 15 calendar days after the month end. Once released to the web, there are no restrictions on providing the data to any shareholder or external party.

No other dissemination of portfolio holdings is allowed to any shareholder, potential shareholder or party external to Evergreen except for dissemination (i) required by law, (ii) to external subadvisers with respect to the Fund it advises, or (iii) to institutional investment consultants or mutual fund analytical firms (such as Morningstar and Lipper) and, in such cases, only where there are signed confidentiality agreements in place that are approved through Evergreen's legal division. Institutional investment consultants are those organizations who utilize fund holdings data and characteristics such as beta, P/E ratio, etc. to screen investment vehicles for their large, institutional clients. These consultants typically compare the Funds against other investment firms’ products to see which is most suitable for the clients. In presentations to clients, these consultants will sometimes provide data regarding the Funds and how they compared to products of other investment advisors. The confidentiality agreements applicable to these situations preclude these firms from providing any client with holdings data until the 15^th calendar day after quarter end when the data is available to the public.

This policy applies to affiliates of Evergreen such as Wachovia Trust and Wachovia Securities. Officers of the Funds may authorize disclosure of the Fund’s portfolio securities in accordance with this policy. The Fund’s Board had reviewed this policy and has designated a chief compliance officer to be responsible for monitoring compliance with the policy. The chief compliance officer reports directly to the Board.

As of May 24, 2005, the Funds had ongoing arrangements with the following recipients to make available non-public portfolio holdings information relating to the Funds:

Recipient	Purpose	Timing
State Street Bank and Trust Company	Funds’ custodian	Daily
KPMG LLP	Funds’ independent registered public accountants	As necessary in connection with financial statements and SEC filings
EIS	Funds’ administrator	Daily
ESC	Funds’ transfer agent	Quarterly
EIMC	Funds’ investment advisor	Daily

Once portfolio holdings information is made public, there are no restrictions on providing the data to any shareholder or other party.

CORPORATE AND MUNICIPAL BOND RATINGS

The Fund relies on ratings provided by independent rating services to help determine the credit quality of bonds and other obligations the Fund intends to purchase or already owns. A rating is an opinion of an issuer’s ability to pay interest and/or principal when due. Ratings reflect an issuer’s overall financial strength and whether it can meet its financial commitments under various economic conditions.

If a security held by the Fund loses its rating or has its rating reduced after the Fund has purchased it, the Fund is not required to sell or otherwise dispose of the security, but may consider doing so.

The principal rating services, commonly used by the Fund and investors generally, are S&P and Moody’s. The Fund may also rely on ratings provided by Fitch. Rating systems are similar among the different services. As an example, the chart below compares basic ratings for long-term bonds. The “Credit Quality” terms in the chart are for quick reference only. Following the chart are the specific definitions each service provides for its ratings.

COMPARISON OF LONG-TERM BOND RATINGS

MOODY’S	S&P	FITCH	Credit Quality
Aaa	AAA	AAA	Excellent Quality (lowest risk)
Aa	AA	AA	Almost Excellent Quality (very low risk)
A	A	A	Good Quality (low risk)
Baa	BBB	BBB	Satisfactory Quality (some risk)
Ba	BB	BB	Questionable Quality (definite risk)
B	B	B	Low Quality (high risk)
Caa/Ca/C	CCC/CC/C	CCC/CC/C	In or Near Default
	D	DDD/DD/D	In Default

CORPORATE BONDS

LONG-TERM RATINGS

Moody’s Corporate Long-Term Bond Ratings

Aaa Bonds which are rated Aaa are judged to be of the best quality. They carry the smallest degree of investment risk and are generally referred to as “gilt edged.” Interest payments are protected by a large or by an exceptionally stable margin and principal is secure. While the various protective elements are likely to change, such changes as can be visualized are most unlikely to impair the fundamentally strong position of such issues.

AaBonds which are rated Aa are judged to be of high quality by all standards. Together with the Aaa group they comprise what are generally known as high grade bonds. They are rated lower than the best bonds because margins of protection may not be as large as in Aaa securities or fluctuation of protective elements may be of greater amplitude or there may be other elements present which make the long-term risk appear somewhat larger than the Aaa securities.

A Bonds which are ratedA possess many favorable investment attributes and are to be considered as upper-medium-grade obligations. Factors giving security to principal and interest are considered adequate, but elements may be present which suggest a susceptibility to impairment some time in the future.

Baa Bonds which are ratedBaa are considered as medium-grade obligations (i.e. they are neither highly protected nor poorly secured). Interest payments and principal security appear adequate for the present but certain protective elements may be lacking or may be characteristically unreliable over any great length of time. Such bonds lack outstanding investment characteristics and in fact have speculative characteristics as well.

Ba Bonds which are rated Baare judged to have speculative elements; their future cannot be considered as well-assured. Often the protection of interest and principal payments may be very moderate, and thereby not well safeguarded during both good and bad times over the future. Uncertainty of position characterizes bonds in this class.

B Bonds which are ratedBgenerally lack characteristics of the desirable investment. Assurance of interest and principal payments or of maintenance of other terms of the contract over any long period of time may be small.

Caa Bonds which are ratedCaa are of poor standing. Such issues may be in default or there may be present elements of danger with respect to principal or interest.

Ca Bonds which are rated Ca represent obligations which are speculative in a high degree. Such issues are often in default or have other marked shortcomings.

C Bonds which are rated C are the lowest rated class of bonds, and issues so rated can be regarded as having extremely poor prospects of ever attaining any real investment standing.

Note: Moody’s applies numerical modifiers,1, 2and 3in each generic rating classification from Aato Caa. The modifier 1indicates that the company ranks in the higher end of its generic rating category; the modifier 2 indicates a mid-range raking and the modifier 3indicates that the company ranks in the lower end of its generic rating category.

S&P Corporate Long-Term Bond Ratings

AAA An obligation rated AAA has the highest rating assigned by S&P. The obligor’s capacity to meet its financial commitment on the obligation is extremely strong.

AA An obligation rated AA differs from the highest-rated obligations only in small degree. The obligor’s capacity to meet its financial commitment on the obligation is very strong.

A An obligation rated A is somewhat more susceptible to the adverse effects of changes in circumstances and economic conditions than obligations in higher-rated categories. However, the obligor’s capacity to meet its financial commitment on the obligation is still strong.

BBB An obligation rated BBB exhibits adequate protection parameters. However, adverse economic conditions or changing circumstances are more likely to lead to a weakened capacity of the obligor to meet its financial commitment on the obligation.

BB, B, CCC, CC and C:As described below, obligations rated BB, B, CCC, CC,and Care regarded as having significant speculative characteristics. BBindicates the least degree of speculation and Cthe highest. While such obligations will likely have some quality and protective characteristics, these may be outweighed by large uncertainties or major exposures to adverse conditions.

BB An obligation rated BB is less vulnerable to nonpayment than other speculative issues. However, it faces major ongoing uncertainties or exposure to adverse business, financial, or economic conditions, which could lead to the obligor’s inadequate capacity to meet its financial commitment on the obligation.

B An obligation rated B is more vulnerable to nonpayment than obligations rated BB, but the obligor currently has the capacity to meet its financial commitment on the obligation. Adverse business, financial, or economic conditions will likely impair the obligor’s capacity or willingness to meet it financial commitment on the obligation.

CCC An obligation rated CCC is currently vulnerable to nonpayment and is dependent upon favorable business, financial, and economic conditions for the obligor to meet its financial commitment on the obligation. In the event of adverse business, financial, or economic conditions, the obligor is not likely to have the capacity to meet its financial commitment on the obligation.

CC An obligation rated CC is currently highly vulnerable to nonpayment.

C The C rating may be used to cover a situation where a bankruptcy petition has been filed or similar action has been taken, but payments on this obligation are being continued.

D The D rating, unlike other ratings, is not prospective; rather, it is used only where a default has actually occurred--and not where a default is only expected. S&P changes ratings to D either:

On the day an interest and/or principal payment is due and is not paid. An exception is made if there is a grace period and S&P believes that a payment will be made, in which case the rating can be maintained; or

Upon voluntary bankruptcy filing or similar action. An exception is made if S&P expects that debt service payments will continue to be made on a specific issue. In the absence of a payment default or bankruptcy filing, a technical default (i.e., covenant violation) is not sufficient for assigning aD rating.

Plus (+) or minus (-) The ratings from AA to CCC may be modified by the addition of a plus or minus sign to show relative standing within the major rating categories.

Fitch Corporate Long-Term Bond Ratings

Investment Grade

AAA Highest credit quality. AAA ratings denote the lowest expectation of credit risk. They are assigned only in case of exceptionally strong capacity for timely payment of financial commitments. This capacity is highly unlikely to be adversely affected by foreseeable events.

AA Very high credit quality. AA ratings denote a very low expectation of credit risk. They indicate very strong capacity for timely payment of financial commitments. This capacity is not significantly vulnerable to foreseeable events.

A High credit quality. A ratings denote a lower expectation of credit risk. The capacity for timely payment of financial commitments is considered strong. This capacity may, nevertheless, be more vulnerable to changes in circumstances or in economic conditions than is the case for higher ratings.

BBB Good credit quality. BBB ratings indicate that there is currently a low expectation of credit risk. The capacity for timely payment of financial commitments is considered adequate, but adverse changes in circumstances and in economic conditions are more likely to impair this capacity. This is the lowest investment-grade category.

Speculative Grade

BB Speculative. BB ratings indicate that there is a possibility of credit risk developing, particularly as the result of adverse economic change over time; however, business or financial alternatives may be available to allow financial commitments to be met. Securities rated in this category are not investment grade.

B Highly speculative. B ratings indicate that significant credit risk is present, but a limited margin of safety remains. Financial commitments are currently being met; however, capacity for continued payment is contingent upon a sustained, favorable business and economic environment.

CCC, CC, C High default risk. Default is a real possibility. Capacity for meeting financial commitment is solely reliant upon sustained, favorable business or economic developments. A CC rating indicates that default of some kind appears probable. C ratings signal imminent default.

DDD, DD, D Default. The ratings of obligations in this category are based on their prospects for achieving partial or full recovery in a reorganization or liquidation of the obligor. While expected recovery values are highly speculative and cannot be estimated with any precision, the following serve as general guidelines. ‘DDD’ obligations have the highest potential for recovery, around 90% - 100% of outstanding amounts and accrued interest. “DD” indicates potential recoveries in the range of 50%-90% and ‘D’ the lowest recovery potential, i.e., below 50%.

Entities rated in this categoryhave defaulted on some or all of their obligations. Entities rated ‘DDD’ have the highest prospect for resumption of performance or continued operation with or without a formal reorganization process. Entities rated ‘DD’ and ‘D’ are generally undergoing a formal reorganization or liquidation process; those rated ‘DD’ are likely to satisfy a higher portion of their outstanding obligations, while entities rated ‘D’ have a poor prospect of repaying all obligations.

+ or -may be appended to a rating to denote relative status within major rating categories. Such suffixes are not added to the AAA rating category or to categories below CCC or to short-term ratings (as discussed below) other than F1.

CORPORATE SHORT-TERM RATINGS

Moody’s Corporate Short-Term Issuer Ratings

Prime-1 Issuers ratedPrime-1 (or supporting institutions) have a superior ability for repayment of senior short-term debt obligations. Prime-1 repayment ability will often be evidenced by many of the following characteristics.

-- Leading market positions in well-established industries.

-- High rates of return on funds employed.

-- Conservative capitalization structure with moderate reliance on debt and ample asset protection.

-- Broad margins in earnings coverage of fixed financial changes and high internal cash generation.

-- Well-established access to a range of financial markets and assured sources of alternate liquidity.

Prime-2 Issuers rated Prime-2 (or supporting institutions) have a strong ability for repayment of senior short-term debt obligations. This will normally be evidenced by many of the characteristics cited above but to a lesser degree. Earnings trends and coverage ratios, while sound, may be more subject to variation. Capitalization characteristics, while still appropriate, may be more affected by external conditions. Ample alternate liquidity is maintained.

Prime-3 Issuers rated Prime-3 (or supporting institutions) have an acceptable ability for repayment of senior short-term obligations. The effect of industry characteristics and market compositions may be more pronounced. Variability in earnings and profitability may result in changes in the level of debt protection measurements and may require relatively high financial leverage. Adequate alternate liquidity is maintained.

Not PrimeIssuers rated Not Prime do not fall within any of the Prime rating categories.

S&P Corporate Short-Term Obligation Ratings

A-1A short-term obligation rated A-1 is rated in the highest category by S&P. The obligor’s capacity to meet its financial commitment on the obligation is strong. Within this category certain obligations are designated with a plus sign (+). This indicates that the obligor’s capacity to meet its financial commitment on these obligations is extremely strong.

A-2A short-term obligation rated A-2 is somewhat more susceptible to the adverse effects of changes in circumstances and economic conditions than obligations in higher rating categories. However, the obligor’s capacity to meet its financial commitment on the obligation is satisfactory.

A-3A short-term obligation rated A-3 exhibits adequate protection parameters. However, adverse economic conditions or changing circumstances are more likely to lead to a weakened capacity of the obligor to meet its financial commitment on the obligation.

B A short-term obligation rated B is regarded as having significant speculative characteristics. The obligor currently has the capacity to meet its financial commitment on the obligation; however, it faces major ongoing uncertainties which could lead to the obligor’s inadequate capacity to meet its financial commitment on the obligation.

C A short-term obligation rated C is currently vulnerable to nonpayment and is dependent upon favorable business, financial, and economic conditions for the obligor to meet its financial commitment on the obligation.

D TheD rating, unlike other ratings, is not prospective; rather, it is used only where a default has actually occurred--and not where a default is only expected. S&P changes ratings toD either:

Upon voluntary bankruptcy filing or similar action, An exception is made if S&P expects that debt service payments will continue to be made on a specific issue. In the absence of a payment default or bankruptcy filing, a technical default (i.e., covenant violation) is not sufficient for assigning aD rating.

Fitch Corporate Short-Term Obligation Ratings

F1 Highest credit quality. Indicates the strongest capacity for timely payment of financial commitments; may have an added “+” to denote any exceptionally strong credit feature.

F2 Good credit quality. A satisfactory capacity for timely payment of financial commitments, but the margin of safety is not as great as in the case of the higher ratings.

F3 Fair credit quality. The capacity for timely payment of financial commitments is adequate; however, near-term adverse changes could result in a reduction to non-investment grade.

B Speculative. Minimal capacity for timely payment of financial commitments, plus vulnerability to near-term adverse changes in financial and economic conditions.

C High default risk. Default is a real possibility. Capacity for meeting financial commitments is solely reliant upon a sustained, favorable business and economic environment.

D Default. Denotes actual or imminent payment default.

MUNICIPAL BONDS

LONG-TERM RATINGS

Moody’s Municipal Long-Term Bond Ratings

Aaa Bonds rated Aaa are judged to be of the best quality. They carry the smallest degree of investment risk and are generally referred to as “gilt edged.” Interest payments are protected by a large or by an exceptionally stable margin and principal is secure. While the various protective elements are likely to change, such changes as can be visualized are most unlikely to impair the fundamentally strong position of such issues.

Aa Bonds rated Aa are judged to be of high quality by all standards. Together with the Aaa group they comprise what are generally known as high grade bonds. They are rated lower than the best bonds because margins of protection may not be as large as in Aaa securities or fluctuation of protective elements may be of greater amplitude or there may be other elements present which make the long-term risk appear somewhat larger than the Aaa securities.

A Bonds ratedA possess many favorable investment attributes and are to be considered as upper-medium grade obligations. Factors giving security to principal and interest are considered adequate, but elements may be present which suggest a susceptibility to impairment some time in the future.

Baa Bonds ratedBaa are considered as medium-grade obligations i.e., they are neither highly protected nor poorly secured. Interest payments and principal security appear adequate for the present but certain protective elements may be lacking or may be characteristically unreliable over any great length of time. Such bonds lack outstanding investment characteristics and in fact have speculative characteristics as well.

Ba Bonds rated Baare judged to have speculative elements; their future cannot be considered as well-assured. Often the protection of interest and principal payments may be very moderate, and thereby not well safeguarded during both good and bad times over the future. Uncertainty of position characterizes bonds in this class.

B Bonds ratedBgenerally lack characteristics of the desirable investment. Assurance of interest and principal payments or of maintenance of other terms of the contract over any long period of time may be small.

Caa Bonds ratedCaa are of poor standing. Such issues may be in default or there may be present elements of danger with respect to principal or interest.

Ca Bonds rated Ca represent obligations which are speculative in a high degree. Such issues are often in default or have other marked shortcomings.

C Bonds rated C are the lowest rated class of bonds, and issues so rated can be regarded as having extremely poor prospects of ever attaining any real investment standing.

Note: Moody’s applies numerical modifiers1, 2and 3in each generic rating classification from Aato B. The modifier 1indicates that the company ranks in the higher end of its generic rating category; the modifier 2 indicates a mid-range raking and the modifier 3indicates that the company ranks in the lower end of its generic rating category.

S&P Municipal Long-Term Bond Ratings

AAA An obligation rated AAA has the highest rating assigned by S&P. The obligor’s capacity to meet its financial commitment on the obligation is extremely strong.

AA An obligation rated AA differs from the highest-rated obligations only in small degree. The obligor’s capacity to meet its financial commitment on the obligation is very strong.

BB, B, CCC, CC and C:As described below, obligations rated BB, B, CCC, CCand Care regarded as having significant speculative characteristics. BBindicates the least degree of speculation and Cthe highest. While such obligations will likely have some quality and protective characteristics, these may be outweighed by large uncertainties or major exposures to adverse conditions.

CC An obligation rated CC is currently highly vulnerable to nonpayment.

C The C rating may be used to cover a situation where a bankruptcy petition has been filed or similar action has been taken, but payments on this obligation are being continued.

D An obligation rated D is in payment default. The D rating category is used when payments on an obligation are not made on the date due even if the applicable grace period has not expired, unless S&P believes that such payments will be made during such grace period. The D rating also will be used upon the filing of a bankruptcy petition or the taking of a similar action if payments on an obligation are jeopardized.

Plus (+) or minus (-) The ratings from AA to CCC may be modified by the addition of a plus or minus sign to show relative standing within the major rating categories.

Fitch Municipal Long-Term Bond Ratings

Investment Grade

Speculative Grade

CCC, CC, C High default risk. Default is a real possibility. Capacity for meeting financial commitments is solely reliant upon sustained, favorable business or economic developments. A CC rating indicates that default of some kind appears probable. C ratings signal imminent default.

DDD, DD, D Default. The ratings of obligations in this category are based on their prospects for achieving partial or full recovery in a reorganization or liquidation of the obligor. While expected recovery values are highly speculative and cannot be estimated with any precision, the following serve as general guidelines. DDD obligations have the highest potential for recovery, around 90%-100% of outstanding amounts and accrued interest. DD indicates potential recoveries in the range of 50%-90% and D the lowest recovery potential, i.e., below 50%.

Entities rated in this category have defaulted on some of all of their obligations. Entities rated DDD have the highest prospect for resumption of performance or continued operation with or without a formal reorganization process. Entities rated DD and D are generally undergoing a formal reorganization or liquidation process: those rated DD are likely to satisfy a higher portion of their outstanding obligations, while entities rated D have a poor prospect of repaying all obligations.

SHORT-TERM MUNICIPAL RATINGS

Moody’s Municipal Short-Term Issuer Ratings

-- Leading market positions in well-established industries.

-- High rates of return on funds employed.

-- Conservative capitalization structure with moderate reliance on debt and ample asset protection.

-- Broad margins in earnings coverage of fixed financial changes and high internal cash generation.

-- Well-established access to a range of financial markets and assured sources of alternate liquidity.

Not PrimeIssuers rated Not Prime do not fall within any of the Prime rating categories.

Moody’s Municipal Short-Term Loan Ratings

MIG 1 This designation denotes best quality. There is strong protection by established cash flows, superior liquidity support, or demonstrated broad-based access to the market for refinancing.

MIG 2 This designation denotes high quality. Margins of protection are ample although not so large as in the preceding group.

MIG 3 This designation denotes favorable quality. Liquidity and cash-flow protection may be narrow and market access for refinancing is likely to be less well established.

SG This designation denotes speculative quality. Debt instruments in this category may lack margins of protection.

S&P Commercial Paper Ratings

A-1 This designation indicates that the degree of safety regarding timely payment is strong. Those issues determined to possess extremely strong safety characteristics are denoted with a plus sign (+) designation.

A-2 Capacity for timely payment on issues with this designation is satisfactory. However, the relative degree of safety is not as high as for issues designated A-1.

A-3 Issues carrying this designation have an adequate capacity for timely payment. They are, however, more vulnerable to the adverse effects of changes in circumstances than obligations carrying the higher designations.

B Issues rated B are regarded as having only speculative capacity for timely payment.

C This rating is assigned to short-term debt obligations with a doubtful capacity for payment.

D Debt rated D is in payment default. The D rating category is used when interest payments or principal payments are not made on the date due, even if the applicable grace period has not expired, unless S&P believes such payments will be made during such grace period.

S&P Municipal Short-Term Obligation Ratings

SP-1 Strong capacity to pay principal and interest. An issue determined to possess a very strong capacity to pay debt service is given a plus (+) designation.

SP-2 Satisfactory capacity to pay principal and interest, with some vulnerability to adverse financial and economic changes over the term of the notes.

SP-3 Speculative capacity to pay principal and interest.

Fitch Municipal Short-Term Obligation Ratings

F1 Highest credit quality. Indicates the strongest capacity for timely payment of financial commitments; may have an added “+” to denote any exceptionally strong credit feature.

F2 Good credit quality. A satisfactory capacity for timely payment of financial commitments, but the margin of safety is not as great as in the case of the higher ratings.

F3 Fair credit quality. The capacity for timely payment of financial commitments is adequate; however, near-term adverse changes could result in a reduction to non-investment grade.

B Speculative. Minimal capacity for timely payment of financial commitments, plus vulnerability to near-term adverse changes in financial and economic conditions.

C High default risk. Default is a real possibility. Capacity for meeting financial commitments is solely reliant upon a sustained, favorable business and economic environment.

D Default. Denotes actual or imminent payment default.

ADDITIONAL INFORMATION

Except as otherwise stated in its prospectus or required by law, the Fund reserves the right to change the terms of the offer stated in its prospectus without shareholder approval, including the right to impose or change fees for services provided.

No dealer, salesman or other person is authorized to give any information or to make any representation not contained in the Fund's prospectus, SAI or in supplemental sales literature issued by the Fund or EIS, and no person is entitled to rely on any information or representation not contained therein.

The Fund's prospectus and SAI omit certain information contained in the Trust's registration statement, which you may obtain for a fee from the SEC in Washington, D.C.

Appendix A

Evergreen Investment Management Company, LLC

Proxy Voting Policy and Procedures

ISS Proxy Voting Guidelines Summary

June 16, 2003

Statement of Principles

Evergreen Investment Management Company, LLC (EIMCO) recognizes it has a fiduciary duty to vote proxies on behalf of clients who have delegated such responsibility to EIMCO, and that in all cases proxies should be voted in a manner reasonably believed to be in the clients’ best interest.

Proxy Voting Records

A copy of the proxy voting records indicating how the Evergreen funds voted proxies relating to portfolio securities during the twelve-month period ended June 30, 2004 may be obtained, without charge, by visiting our website at EvergreenInvestments.com or the SEC’s website at http://www.sec.gov.

Corporate Governance Committee

EIMCO has established a corporate governance committee (Committee) which is a sub-committee of EIMCO’s Investment Policy Committee. The Committee is responsible for approving EIMCO’s proxy voting policies and procedures, for overseeing the proxy voting process, and for reviewing proxy voting on a regular basis. The Committee will meet quarterly to review reports of all proxies voted for the prior period and to conduct other business as required.

Conflicts of Interest

EIMCO recognizes that under certain circumstances it may have a conflict of interest in voting proxies on behalf of its clients. Such circumstances may include, but are not limited to, situations where EIMCO or one or more of its affiliates has a client or customer relationship with the issuer of the security that is the subject of the proxy vote.

In most cases, structural and informational barriers within EIMCO and Wachovia Corporation will prevent EIMCO from becoming aware of the relationship giving rise to the potential conflict of interest. In such circumstances, EIMCO will vote the proxy according to its standard guidelines and procedures described above.

If persons involved in proxy voting on behalf of EIMCO becomes aware of a potential conflict of interest, the Committee shall consult with EIMCO’s Legal Department and consider whether to implement special procedures with respect to the voting of that proxy, including whether an independent third party should be retained to vote the proxy.

Share Blocking

EIMCO does not vote global proxies, with share blocking restrictions, requiring shares to be prohibited from sale.

Proxy Voting Guideline Summary

I. The Board of Directors

Voting on Director Nominees in Uncontested Elections

Votes on director nominees should be made on a case-by-case basis, examining the following factors: composition of the board and key board committees, attendance at board meetings, corporate governance provisions and takeover activity, long-term company performance relative to a market index, directors’ investment in the company, whether the chairman is also serving as CEO, and whether a retired CEO sits on the board. However, there are some actions by directors that should result in votes being withheld. These instances include directors who:

· Attend less than 75 percent of the board and committee meetings without a valid excuse

· Implement or renew a dead-hand or modified dead-hand poison pill

· Ignore a shareholder proposal that is approved by a majority of the shares outstanding

· Ignore a shareholder proposal that is approved by a majority of the votes cast for two consecutive years

· Have failed to act on takeover offers where the majority of the shareholders have tendered their shares

· Are inside directors and sit on the audit, compensation, or nominating committees

· Are inside directors and the full board serves as the audit, compensation, or nominating committee or the company does not have one of these committees

In addition, directors who enacted egregious corporate governance policies or failed to replace management as appropriate would be subject to recommendations to withhold votes.

Separating Chairman and CEO

Vote on a case-by-case basis on shareholder proposals requiring that the positions of chairman and CEO be held separately.

Proposals Seeking a Majority of Independent Directors

Shareholder proposals asking that a majority of directors be independent should be evaluated on a case-by-case basis. Vote for shareholder proposals asking that board audit, compensation, and/or nominating committees be composed exclusively of independent directors.

Stock Ownership Requirements

Vote against shareholder proposals requiring directors to own a minimum amount of company stock in order to qualify as a director or to remain on the board.

Term of Office

Vote against shareholder proposals to limit the tenure of outside directors.

Age Limits

Vote against shareholder proposals to impose a mandatory retirement age for outside directors.

Director and Officer Indemnification and Liability Protection

Proposals on director and officer indemnification and liability protection should be evaluated on a case-by-case basis, using Delaware law as the standard. Vote against proposals to eliminate entirely directors’ and officers’ liability for monetary damages for violating the duty of care. Vote against indemnification proposals that would expand coverage beyond just legal expenses to acts, such as negligence, that are more serious violations of fiduciary obligation than mere carelessness. Vote for only those proposals providing such expanded coverage in cases when a director’s or officer’s legal defense was unsuccessful if: (1) the director was found to have acted in good faith and in a manner that he reasonably believed was in the best interests of the company, and (2) only if the director’s legal expenses would be covered.

Charitable Contributions

Vote against proposals regarding charitable contributions.

II. Proxy Contests

Voting for Director Nominees in Contested Elections

Votes in a contested election of directors must be evaluated on a case-by-case basis, considering the following factors: long-term financial performance of the target company relative to its industry; management’s track record; background to the proxy contest; qualifications of director nominees (both slates); evaluation of what each side is offering shareholders as well as the likelihood that the proposed objectives and goals can be met; and stock ownership positions.

Reimburse Proxy Solicitation Expenses

Voting to reimburse proxy solicitation expenses should be analyzed on a case-by-case basis. In cases where Evergreen recommends in favor of the dissidents, we also recommend voting for reimbursing proxy solicitation expenses.

III. Auditors

Ratifying Auditors

Vote for proposals to ratify auditors, unless: an auditor has a financial interest in or association with the company, and is therefore not independent; or there is reason to believe that the independent registered public accounting firm has rendered an opinion which is neither accurate nor indicative of the company’s financial position.

IV. Proxy Contest Defenses

Board Structure: Staggered vs. Annual Elections

Vote against proposals to classify the board.

Vote for proposals to repeal classified boards and to elect all directors annually.

Shareholder Ability to Remove Directors

Vote against proposals that provide that directors may be removed only for cause.

Vote for proposals to restore shareholder ability to remove directors with or without cause.

Vote against proposals that provide that only continuing directors may elect replacements to fill board vacancies.

Vote for proposals that permit shareholders to elect directors to fill board vacancies.

Cumulative Voting

Vote against proposals to eliminate cumulative voting.

Vote proposals to restore or permit cumulative voting on a case-by-case basis relative to the company’s other governance provisions.

Shareholder Ability to Call Special Meetings

Vote against proposals to restrict or prohibit shareholder ability to call special meetings.

Vote for proposals that remove restrictions on the right of shareholders to act independently of management.

Shareholder Ability to Act by Written Consent

Voteagainst proposals to restrict or prohibit shareholder ability to take action by written consent.

Vote for proposals to allow or make easier shareholder action by written consent.

Shareholder Ability to Alter the Size of the Board

Vote for proposals that seek to fix the size of the board.

Vote against proposals that give management the ability to alter the size of the board without shareholder approval.

V. Tender Offer Defenses

Poison Pills

Vote for shareholder proposals that ask a company to submit its poison pill for shareholder ratification.

Review on a case-by-case basis shareholder proposals to redeem a company’s poison pill.

Review on a case-by-case basis management proposals to ratify a poison pill.

Fair Price Provisions

Vote proposals to adopt fair price provisions on a case-by-case basis, evaluating factors such as the vote required to approve the proposed acquisition, the vote required to repeal the fair price provision, and the mechanism for determining the fair price.

Generally, vote against fair price provisions with shareholder vote requirements greater than a majority of disinterested shares.

Greenmail

Vote for proposals to adopt antigreenmail charter of bylaw amendments or otherwise restrict a company’s ability to make greenmail payments.

Review on a case-by-case basis antigreenmail proposals when they are bundled with other charter or bylaw amendments.

Pale Greenmail

Review on a case-by-case basis restructuring plans that involve the payment of pale greenmail.

Unequal Voting Rights

Vote against dual-class exchange offers.

Vote against dual-class recapitalizations.

Supermajority Shareholder Vote Requirement to Amend the Charter or Bylaws

Vote against management proposals to require a supermajority shareholder vote to approve charter and bylaw amendments.

Vote for shareholder proposals to lower supermajority shareholder vote requirements for charter and bylaw amendments.

Supermajority Shareholder Vote Requirement to Approve Mergers

Vote against management proposals to require a supermajority shareholder vote to approve mergers and other significant business combinations.

Vote for shareholder proposals to lower supermajority shareholder vote requirements for mergers and other significant business combinations.

White Squire Placements

Vote for shareholder proposals to require approval of blank check preferred stock Issues for other than general corporate purposes.

VI. Miscellaneous Governance Provisions

Confidential Voting

Vote for shareholder proposals that request companies to adopt confidential voting, use independent tabulators, and use independent inspectors of election as long as the proposals include clauses for proxy contests as follows: In the case of a contested election, management should be permitted to request that the dissident group honor its confidential voting policy. If the dissidents agree, the policy remains in place. If the dissidents do not agree, the confidential voting policy is waived.

Vote for management proposals to adopt confidential voting.

Equal Access

Vote for shareholder proposals that would allow significant company shareholders equal access to management’s proxy material in order to evaluate and propose voting recommendations on proxy proposals and director nominees, and in order to nominate their own candidates to the board.

Bundled Proposals

Review on a case-by-case basis bundled or “conditioned” proxy proposals. In the case of items that are conditioned upon each other, examine the benefits and costs of the packaged items. In instances when the joint effect of the conditioned items is not in shareholders’ best interests, vote against the proposals. If the combined effect is positive, support such proposals.

Shareholder Advisory Committees

Review on a case-by-case basis proposals to establish a shareholder advisory committee.

VII. Capital Structure

Common Stock Authorization

Review proposals to increase the number of shares of common stock authorized for issue on a case-by-case basis.

Vote against proposals to increase the number of authorized shares of the class of stock that has superior voting rights in companies that have dual-class capitalization structures.

Stock Distributions: Splits and Dividends

Vote for management proposals to increase common share authorization for a stock split, provided that the increase in authorized shares would not result in an excessive number of shares available for issuance given a company’s industry and performance in terms of shareholder returns.

Reverse Stock Splits

Vote for management proposals to implement a reverse stock split when the number of shares will be proportionately reduced to avoid delisting.

Review on acase-by-case basis on proposals to implement a reverse stock split that do not proportionately reduce the number of shares authorized for Issue.

Preferred Stock

Vote against proposals authorizing the creation of new classes of preferred stock with unspecified voting, conversion, dividend distribution, and other rights (“blank check” preferred stock).

Vote for proposals to create blank check preferred stock in cases when the company expressly states that the stock will not be used as a takeover defense.

Vote for proposals to authorize preferred stock in cases where the company specifies the voting, dividend, conversion, and other rights of such stock and the terms of the preferred stock appear reasonable.

Vote case-by-case on proposals to increase the number of blank check preferred shares after analyzing the number of preferred shares available for Issue given a company’s industry and performance in terms of shareholder returns.

Shareholder Proposals Regarding Blank Check Preferred Stock

Vote for shareholder proposals to have blank check preferred stock placements, other than those shares issued for the purpose of raising capital or making acquisitions in the normal course of business, submitted for shareholder ratification.

Adjustments to Par Value of Common Stock

Vote for management proposals to reduce the par value of common stock.

Preemptive Rights

Review on a case-by-case basis shareholder proposals that seek preemptive rights. In evaluating proposals on preemptive rights, consider the size of a company and the characteristics of its shareholder base.

Debt Restructurings

Review on a case-by-case basis proposals to increase common and/or preferred shares and to Issue shares as part of a debt restructuring plan. Consider the following Issues: Dilution—How much will ownership interest of existing shareholders be reduced, and how extreme will dilution to any future earnings be? Change in Control—Will the transaction result in a change in control of the company? Bankruptcy—Generally, approve proposals that facilitate debt restructurings unless there are clear signs of self-dealing or other abuses.

Share Repurchase Programs

Vote for management proposals to institute open-market share repurchase plans in which all shareholders may participate on equal terms.

Tracking Stock

Votes on the creation of tracking stock are determined on a case-by-case basis, weighing the strategic value of the transaction against such factors as:

· adverse governance changes

· excessive increases in authorized capital stock

· unfair method of distribution

· diminution of voting rights

· adverse conversion features

· negative impact on stock option plans

· other alternatives such as spinoff

VIII. Executive and Director Compensation

Votes with respect to compensation plans should be determined on a case-by-case basis.

Our new methodology for reviewing compensation plans primarily focuses on the transfer of shareholder wealth (the dollar cost of pay plans to shareholders instead of simply focusing on voting power dilution). Using the expanded compensation data disclosed under the SEC’s new rules, Evergreen will value every award type. Evergreen will include in its analyses an estimated dollar cost for the proposed plan and all continuing plans. This cost, dilution to shareholders’ equity, will also be expressed as a percentage figure for the transfer of shareholder wealth, and will be considered along with dilution to voting power. Once Evergreen determines the estimated cost of the plan, we compare it to a company-specific dilution cap.

Our model determines a company-specific allowable pool of shareholder wealth that may be transferred from the company to executives, adjusted for (1) long-term corporate performance (on an absolute basis and relative to a standard industry peer group and an appropriate market index), (2) cash compensation, and (3) categorization of the company as emerging, growth, or mature. These adjustments are pegged to market capitalization. Evergreen will continue to examine other features of proposed pay plans such as administration, payment terms, plan duration, and whether the administering committee is permitted to reprice underwater stock options without shareholder approval.

Management Proposals Seeking Approval to Reprice Options

Vote on management proposals seeking approval to reprice options on a case-by-case basis.

Director Compensation

Votes on stock-based plans for directors are made on a case-by-case basis.

Employee Stock Purchase Plans

Votes on employee stock purchase plans should be made on a case-by-case basis.

OBRA-Related Compensation Proposals:

Amendments that Place a Cap on Annual Grants or Amend Administrative Features

Vote for plans that simply amend shareholder-approved plans to include administrative features or place a cap on the annual grants any one participant may receive to comply with the provisions of Section 162(m) of OBRA.

Amendments to Added Performance-Based Goals

Vote for amendments to add performance goals to existing compensation plans to comply with the provisions of Section 162(m) of OBRA.

Amendments to Increase Shares and Retain Tax Deductions Under OBRA

Votes on amendments to existing plans to increase shares reserved and to qualify the plan for favorable tax treatment under the provisions of Section 162(m) should be evaluated on a case-by-case basis.

Approval of Cash or Cash-and-Stock Bonus Plans

Vote for cash or cash-and-stock bonus plans to exempt the compensation from taxes under the provisions of Section 162(m) of OBRA.

Shareholder Proposals to Limit Executive and Director Pay

Generally, vote for shareholder proposals that seek additional disclosure of executive and director pay information.

Review on a case-by-case basis all other shareholder proposals that seek to limit executive and director pay.

Golden and Tin Parachutes

Vote for shareholder proposals to have golden and tin parachutes submitted for shareholder ratification.

Review on a case-by-case basis all proposals to ratify or cancel golden or tin parachutes.

Employee Stock Ownership Plans (ESOPs)

Vote for proposals that request shareholder approval in order to implement an ESOP or to increase authorized shares for existing ESOPs, except in cases when the number of shares allocated to the ESOP is “excessive” (i.e., generally greater than five percent of outstanding shares).

401(k) Employee Benefit Plans

Votefor proposals to implement a 401(k) savings plan for employees.

IX. State of Incorporation

Voting on State Takeover Statutes

Review on a case-by-case basis proposals to opt in or out of state takeover statutes (including control share acquisition statutes, control share cash-out statutes, freezeout provisions, fair price provisions, stakeholder laws, poison pill endorsements, severance pay and labor contract provisions, antigreenmail provisions, and disgorgement provisions).

Voting on Reincorporation Proposals

Proposals to change a company’s state of incorporation should be examined on a case-by-case basis.

X. Mergers and Corporate Restructurings

Mergers and Acquisitions

Votes on mergers and acquisitions should be considered on a case-by-case basis, taking into account at least the following: anticipated financial and operating benefits; offer price (cost vs. premium); prospects of the combined companies; how the deal was negotiated; and changes in corporate governance and their impact on shareholder rights.

Corporate Restructuring

Votes on corporate restructuring proposals, including minority squeezeouts, leveraged buyouts, spinoffs, liquidations, and asset sales should be considered on a case-by-case basis.

Spinoffs

Votes on spinoffs should be considered on a case-by-case basis depending on the tax and regulatory advantages, planned use of sale proceeds, market focus, and managerial incentives.

Asset Sales

Votes on asset sales should be made on a case-by-case basis after considering the impact on the balance sheet/working capital, value received for the asset, and potential elimination of diseconomies.

Liquidations

Votes on liquidations should be made on a case-by-case basis after reviewing management’s efforts to pursue other alternatives, appraisal value of assets, and the compensation plan for executives managing the liquidation.

Appraisal Rights

Vote for proposals to restore, or provide shareholders with, rights of appraisal.

Changing Corporate Name

Vote for changing the corporate name.

XI. Mutual Fund Proxies

Election of Directors

Vote the election of directors on a case-by-case basis, considering the following factors: board structure; director independence and qualifications; and compensation of directors within the fund and the family of funds attendance at board and committee meetings.

Votes should be withheld from directors who:

· attend less than 75 percent of the board and committee meetings without a valid excuse for the absences. Valid reasons include illness or absence due to company business. Participation via telephone is acceptable. In addition, if the director missed only one meeting or one day’s meetings, votes should not be withheld even if such absence dropped the director’s attendance below 75 percent.

· ignore a shareholder proposal that is approved by a majority of shares outstanding

· ignore a shareholder proposal that is approved by a majority of the votes cast for two consecutive years

· are interested directors and sit on the audit or nominating committee

· are interested directors and the full board serves as the audit or nominating committee or the company does not have one of these committees.

Converting Closed-end Fund to Open-end Fund

Vote conversion proposals on a case-by-case basis, considering the following factors: past performance as a closed-end fund; market in which the fund invests; measures taken by the board to address the discount; and past shareholder activism, board activity, and votes on related proposals.

Proxy Contests

Vote proxy contests on acase-by-case basis, considering the following factors: past performance; market in which fund invests; and measures taken by the board to address the Issues past shareholder activism, board activity, and votes on related proposals.

Investment Advisory Agreements

Vote the investment advisory agreements on a case-by-case basis, considering the following factors: proposed and current fee schedules; fund category/investment objective; performance benchmarks; share price performance as compared with peers; and the magnitude of any fee increase.

Approving New Classes or Series of Shares

Vote for the establishment of new classes or series of shares.

Preferred Stock Proposals

Vote the authorization for or increase in preferred shares on a case-by-case basis, considering the following factors: stated specific financing purpose and other reasons management gives possible dilution for common shares.

1940 Act Policies

Vote these proposals on a case-by-case basis, considering the following factors: potential competitiveness; regulatory developments; current and potential returns; and current and potential risk.

Changing a Fundamental Restriction to a Nonfundamental Restriction

Vote these proposals on a case-by-case basis, considering the following factors: fund’s target investments; reasons given by fund for change; and the projected impact of change on portfolio.

Change Fundamental Investment Objective to Nonfundamental

Voteagainst proposals to change a fund’s fundamental investment objective to nonfundamental.

Name Rule Proposals

Vote these proposals on a case-by-case basis, considering the following factors: political/economic changes in target market; bundling with quorum requirements; bundling with asset allocation changes; and consolidation in the fund’s target market.

Disposition of Assets/Termination/Liquidation

Vote this proposal on a case-by-case basis, considering the following factors: strategies employed to salvage the company; company’s past performance; and terms of the liquidation.

Changes to the Charter Document

Vote changes to the charter document on a case-by-case basis, considering the following factors: degree of change implied by the proposal; efficiencies that could result; state of incorporation; and regulatory standards and implications.

Changing the Domicile of a Fund

Vote reincorporations on a case-by-case basis, considering the following factors: state regulations of both states; required fundamental policies of both states; and the increased flexibility available.

Change in Fund’s Subclassification

Vote these proposals on a case-by-case basis, considering the following factors: potential competitiveness; current and potential returns; risk of concentration; and consolidation in the target industry.

Authorizing the Board to Hire and Terminate Subadvisors Without Shareholder Approval

Vote against these proposals.

Distribution Agreements

Vote these proposals on a case-by-case basis, considering the following factors: fees charged to comparably sized funds with similar objectives; proposed distributor’s reputation and past performance; and competitiveness of fund in industry.

Master-Feeder Structure

Vote for the establishment of a master-feeder structure.

Changes to the Charter Document

Mergers

Vote merger proposals on a case-by-case basis, considering the following factors: resulting fee structure; performance of both funds; and continuity of management personnel.

Shareholder Proposals

Establish Director Ownership Requirement

Vote against the establishment of a director ownership requirement.

Reimburse Shareholder for Expenses Incurred

Terminate the Investment Advisor

Vote to terminate the investment advisor on a case-by-case basis, considering the following factors: performance of the fund’s NAV and the history of shareholder relations.

XII. Social and Environmental Issues

Energy and Environment

In most cases, Evergreen refrains from providing a vote recommendation on proposals that request companies to file the CERES Principles.

Generally, vote for disclosure reports that seek additional information, particularly when it appears companies have not adequately addressed shareholders’ environmental concerns.

South Africa

In most cases, Evergreen refrains from providing a vote recommendation on proposals pertaining to South Africa.

Generally, vote for disclosure reports that seek additional information such as the amount of business that could be lost by conducting business in South Africa.

Northern Ireland

In most cases, Evergreen refrains from providing a vote recommendation on proposals pertaining to the MacBride Principles.

Generally, vote for disclosure reports that seek additional information about progress being made toward eliminating employment discrimination, particularly when it appears companies have not adequately addressed shareholder concerns.

Military Business

In most cases, Evergreen refrains from providing a vote recommendation on defense Issue proposals.

Generally, vote for disclosure reports that seek additional information on military related operations, particularly when the company has been unresponsive to shareholder requests.

Maquiladora Standards and International Operations Policies

In most cases, Evergreen refrains from providing a vote recommendation on proposals relating to the Maquiladora Standards and international operating policies.

Generally, vote for disclosure reports on these Issues, particularly when it appears companies have not adequately addressed shareholder concerns.

World Debt Crisis

In most cases, Evergreen refrains from providing a vote recommendation on proposals dealing with third world debt.

Generally, vote for disclosure reports on these Issues, particularly when it appears companies have not adequately addressed shareholder concerns.

Equal Employment Opportunity and Discrimination

In most cases, Evergreen refrains from providing a vote recommendation on proposals regarding equal employment opportunities and discrimination.

Generally, vote for disclosure reports that seek additional information about affirmative action efforts, particularly when it appears companies have been unresponsive to shareholder requests.

Animal Rights

In most cases, Evergreen refrains from providing a vote recommendation on proposals that deal with animal rights.

Product Integrity and Marketing

In most cases, Evergreen refrains from providing a vote recommendation on proposals that ask companies to end their production of legal, but socially questionable, products.

Generally, vote for disclosure reports that seek additional information regarding product integrity and marketing Issues, particularly when it appears companies have been unresponsive to shareholder requests.

Human Resources issues

In most cases, Evergreen refrains from providing a vote recommendation on proposals regarding human resources Issues.

Generally, vote for disclosure reports that seek additional information regarding human resources Issues, particularly when it appears companies have been unresponsive to shareholder requests.

EVERGREEN MONEY MARKET TRUST

PART C

OTHER INFORMATION

Item 23. Exhibits

Unless otherwise indicated, each of the Exhibits listed below is filed
herewith.

Number	Exhibit Description	Location

(a)	Declaration of Trust	Incorporated by reference to Registrant's Post-Effective Amendment No. 20 Filed on May 26, 2004

(b)	By-laws (Amended and Restated)	Incorporated by reference to Registrant's Post-Effective Amendment No. 13 Filed on April 12, 2001

(c)	Provisions of instruments defining the rights of holders of the securities being registered are contained in the Declaration of Trust Articles II, III.(6)(c), VI.(3), IV.(8), V, VI, VII, VIII and By-laws Articles II, III and VIII.	Included as part of Exhibit a and b above

(d)	Investment Advisory and Management Agreement between the Registrant and Evergreen Investment Management Company, LLC	Incorporated by reference to Registrant's Post-Effective Amendment No. 20 Filed on May 26, 2004

(e)(1)	Class A, B, C, I, S and S1 Principal Underwriting Agreement between the Registrant and Evergreen Investment Services, Inc.	Incorporated by reference to Registrant's Post-Effective Amendment No. 20 Filed on May 26, 2004

(e)(2)	Specimen of Dealer Agreement used by Evergreen Distributor, Inc.	Contained herein

(e)(3)	Amendment to Dealer Agreement	Contained herein

(f)	Deferred Compensation Plan	Incorporated by reference to Registrant's Post-Effective Amendment No. 13 Filed on April 12, 2001

(g)(1)	Custodian Agreement between the Registrant and State Street Bank and Trust Company	Incorporated by reference to Registrant's Post-Effective Amendment No. 4 Filed on May 31, 1998

(g)(2)	Letter Amendment to Custodian Agreement (Evergreen California Municipal Money Market Fund and Evergreen U.S. Government Money Market Fund)	Incorporated by reference to Registrant's Post-Effective Amendment No. 10 Filed on August 6, 1999

(g)(3)	Letter Amendment to Custodian Agreement (Evergreen New York Municipal Money Market Fund)	Incorporated by reference to Registrant's Post-Effective Amendment No. 15 Filed on June 25, 2001

(h)(1)	Master Administration Agreement between Evergreen Investment Services, Inc. and the Registrant	Incorporated by reference to Registrant's Post-Effective Amendment No. 18 Filed on May 31, 2002

(h)(2)	Master Transfer and Recordkeeping Agreement between the Registrant and Evergreen Service Company, LLC	Contained herein.

(h)(3)	Letter Amendment to Transfer Agent Agreement (Evergreen California Municipal Money Market Fund and Evergreen U.S. Government Money Market Fund)	Incorporated by reference to Registrant's Post-Effective Amendment No. 10 Filed on August 6, 1999

(h)(4)	Letter Amendment to Transfer Agent Agreement (Evergreen New York Municipal Money Market Fund)	Incorporated by reference to Registrant's Post-Effective Amendment No. 15 Filed on June 25, 2001

(h)(5)	Tax Services Administration Agreement between Evergreen Investment Services, Inc. and State Street Bank and Trust Company	Contained herein.

(i)	Opinion and Consent of Sullivan & Worcester LLP	Incorporated by reference to Registrant's Registration Statement Filed on December 12, 1997

(j)	Consent of KPMG LLP	Contained herein.

(k)	Not applicable

(l)	Not applicable

(m)(1)	12b-1 Distribution Plan for Class A	Incorporated by reference to Registrant's Post-Effective Amendment No. 15 Filed on June 25, 2001

(m)(2)	12b-1 Distribution Plan for Class B	Incorporated by reference to Registrant's Post-Effective Amendment No. 15 Filed on June 25, 2001

(m)(3)	12b-1 Distribution Plan for Class C	Incorporated by reference to Registrant's Post-Effective Amendment No. 15 Filed on June 25, 2001

(m)(4)	12b-1 Distribution Plan for Class S	Incorporated by reference to Registrant's Post-Effective Amendment No. 15 Filed on June 25, 2001

(m)(5)	12b-1 Distribution Plan for Class S1 (Evergreen Money Market Fund, Evergreen Municipal Money Market Fund and Evergreen U.S. Government Money Market Fund)	Incorporated by reference to Registrant's Post-Effective Amendment No. 15 Filed on June 25, 2001

(n)	Not applicable

(o)	Multiple Class Plan	Incorporated by reference to Registrant's Post-Effective Amendment No. 20 Filed on May 26, 2004

(p)	Code of Ethics of Evergreen Investment Management Company, LLC	Contained herein

Item 24.       Persons Controlled by or Under Common Control with Registrant.

None

Item 25.       Indemnification.

Registrant has obtained from a major insurance carrier a trustees and officers liability policy covering certain types of errors and omissions. Provisions for the indemnification of the Registrant's Trustees and officers are also contained in the Registrant's Declaration of Trust.

Provisions for the indemnification of the Registrant's Investment Advisor are contained in the respective Investment Advisory and Management Agreement.

Provisions for the indemnification of Evergreen Investment Services, Inc., the Registrant's principal underwriter and administrator, are contained in the Principal Underwriting Agreement and Master Administrative Services Agreement, respectively, between Evergreen Investment Services, Inc. and the Registrant.

Provisions for the indemnification of Evergreen Service Company, LLC, the Registrant’s transfer agent, are contained in the Master Transfer and Recordkeeping Agreement between Evergreen Service Company, LLC and the Registrant.

Provisions for the indemnification of State Street Bank and Trust Co., the Registrant’s custodian, are contained in the Custodian Agreement between State Street Bank and Trust Co. and the Registrant.

Provisions for the indemnification of State Street Bank and Trust Co., the Registrant's financial administrator, are contained in the Tax Services Administration Agreement between State Street Bank and Trust Co. and the Registrant.

Item 26.       Business or Other Connections of Investment Advisor.

     The information required by this item with respect to Evergreen Investment Management Company, LLC is incorporated by reference to the Form ADV (File No. 801-8327) of Evergreen Investment Management Company, LLC.


Item 27.       Principal Underwriter.

Evergreen Investment Services, Inc. (EIS) acts as principal underwriter for each registered investment company or series thereof that is a part of the Evergreen “fund complex” as such term is defined in Item 22(a) of Schedule 14A under the Securities Exchange Act of 1934.

Information on the officers and directors of EIS is set forth below. The principal business address is 200 Berkeley Street, Boston, Massachusetts 02116-50354:

Name and Principal Business Address	Positions and Offices with Underwriter	Positions and Offices with Funds

Peter W. Brennan	Senior Vice President	None
Maryann Bruce	President	None
Timothy F. Curtin	Senior Vice President	None
Dennis H. Ferro	Director	President
Michele M. Grant	Chief Compliance Officer	None
Michael H. Koonce	Senior Vice President, General Counsel and Secretary	Secretary
Matthew C. Moss	Senior Vice President, Treasurer and Chief Financial Officer		None
W. Douglas Munn	Director	None

Item 28. Location of Accounts and Records.

All accounts and records required to be maintained by Section 31(a) of the Investment Company Act of 1940 and the Rules 31a-1 through 31a-3 promulgated thereunder are maintained at one of the following locations:

Evergreen Investment Services, Inc., Evergreen Service Company, LLC and Evergreen Investment Management Company, LLC, all located at 200 Berkeley Street, Boston, Massachusetts 02116-5034

Wachovia Bank, N.A., One Wachovia Center, 301 S. College Street, Charlotte, North Carolina 28288

Iron Mountain, 3431 Sharp Slot Road, Swansea, Massachusetts 02777

State Street Bank and Trust Company, 2 Heritage Drive, North Quincy, Massachusetts 02171

Item 29.       Management Services.

     Not Applicable

Item 30.       Undertakings.

The Registrant hereby undertakes to furnish each person to whom a prospectus is delivered with a copy of the Registrant's latest annual report to shareholders, upon request and without charge.

NOTICE

A copy of the Certificate of Trust of Evergreen Money Market Trust (the "Trust"), together with all amendments thereto, is on file with the Secretary of State of The State of Delaware and notice is hereby given that this instrument is executed on behalf of the Trust by trustees and officers of the Trust as officers and trustees and not individually and that the obligations of or arising out of this instrument are not binding upon any of the officers or trustees of the Trust or shareholders individually or of any series of the Trust individually but are binding only upon the assets and property of the Trust or the relevant series.

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933 and the Investment Company Act of 1940 the Registrant certifies that it has met all of the requirements for effectiveness of this Post-Effective Amendment No. 21 (the "Amendment") to its Registration Statement pursuant to Rule 485(b) under the Securities Act of 1933 and has duly caused this Amendment to be signed on its behalf by the undersigned, thereto duly authorized, in the City of Boston, and Commonwealth of Massachusetts, on the 25th day of May 2005.

		EVERGREEN MONEY MARKET TRUST
		By: /s/ Michael H. Koonce
		Name: Michael H. Koonce
		Title: Secretary

Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed below by the following persons in the capacities indicated on the 25th day of May 2005.

/s/ Dennis H. Ferro	/s/ Michael H. Koonce	/s/ Carol A. Kosel
Dennis H. Ferro*	Michael H. Koonce*	Carol A. Kosel*
President	Secretary	Treasurer
(Chief Executive Officer)		(Principal Financial and Accounting Officer)

/s/ Charles A. Austin, III	/s/K. Dun Gifford	/s/ William Walt Pettit
Charles A. Austin III*	K. Dun Gifford*	William Walt Pettit*
Trustee	Trustee	Trustee

/s/ Gerald M. McDonnell	/s/ Russell A. Salton, III MD	/s/ Richard K. Wagoner
Gerald M. McDonnell*	Russell A. Salton, III MD*	Richard K. Wagoner*
Trustee	Trustee	Trustee

/s/ Michael S. Scofield	/s/ David M. Richardson	/s/ Leroy Keith, Jr.
Michael S. Scofield*	David M. Richardson*	Leroy Keith, Jr.*
Chairman of the Board	Trustee	Trustee
and Trustee

/s/ Richard J. Shima	/s/ Shirley L. Fulton
Richard J. Shima*	Shirley L. Fulton*
Trustee	Trustee

*By: /s/ Catherine F. Kennedy
Catherine F. Kennedy
Attorney-in-Fact

* Catherine F. Kennedy, by signing her name hereto, does hereby sign this document on behalf of each of the above-named individuals pursuant to powers of attorney duly executed by such persons.

INDEX TO EXHIBITS
EXHIBIT NO.	EXHIBIT

(e)(2)	Specimen of Dealer Agreement used by Evergreen Distributor, Inc.

(e)(3)	Amendment to Dealer Agreement

(h)(2)	Master Transfer and Recordkeeping Agreement between the Registrant and Evergreen Service Company, LLC

(h)(5)	Tax Services Administration Agreement between Evergreen Investment Services, Inc. and State Street Bank and Trust Company

(j)	Consent of KPMG LLP

(p)	Code of Ethics

Evergreen Money Market Funds

Evergreen California Municipal Money Market Fund Evergreen Money Market Fund Evergreen Municipal Money Market Fund Evergreen New York Municipal Money Market Fund Evergreen U.S. Government Money Market Fund

Class A

TABLE OF CONTENTS

FUND RISK/RETURN SUMMARIES:

GENERAL INFORMATION:

In general,

Fund Summaries Key

INVESTMENT GOAL

INVESTMENT STRATEGY

RISK FACTORS

PERFORMANCE

FEES AND EXPENSES

Overview of Fund Risks

Money Market Funds

typically rely on a combination of the following strategies:

may be appropriate for investors who:

Risk Factors For All Mutual Funds

Interest Rate Risk

Credit Risk

Concentration Risk

Non-Diversification Risk

California Municipal Money Market Fund

FUND FACTS:

Goals:

Principal Investment:

Class of Shares Offered in this Prospectus:

Investment Advisor:

NASDAQ Symbol:

Dividend Payment Schedule:

INVESTMENT GOAL

INVESTMENT STRATEGY

RISK FACTORS

PERFORMANCE

FEES AND EXPENSES

Money Market Fund

FUND FACTS:

Goals:

Principal Investments:

Class of Shares Offered in this Prospectus:

Investment Advisor:

NASDAQ Symbol:

Dividend Payment Schedule:

INVESTMENT GOAL

INVESTMENT STRATEGY

RISK FACTORS

PERFORMANCE

FEES AND EXPENSES

Municipal Money Market Fund

FUND FACTS:

Goals:

Principal Investment:

Class of Shares Offered in this Prospectus:

Investment Advisor:

NASDAQ Symbol:

Dividend Payment Schedule:

INVESTMENT GOAL

INVESTMENT STRATEGY

RISK FACTORS

PERFORMANCE

FEES AND EXPENSES

New York Municipal Money Market Fund

FUND FACTS:

Goals:

Principal Investment:

Class of Shares Offered in this Prospectus:

Investment Advisor:

NASDAQ Symbol:

Dividend Payment Schedule:

INVESTMENT GOAL

INVESTMENT STRATEGY

RISK FACTORS

PERFORMANCE

FEES AND EXPENSES

U.S. Government Money Market Fund

FUND FACTS:

Goals:

Principal Investment:

Class of Shares Offered in this Prospectus:

Investment Advisor:

Evergreen
Money Market Funds

Evergreen California Municipal Money Market Fund
Evergreen Money Market Fund
Evergreen Municipal Money Market Fund
Evergreen New York Municipal Money Market Fund
Evergreen U.S. Government Money Market Fund

Evergreen Express Line
1.800.346.3858

THE TAX CONSEQUENCES OF INVESTING
IN THE FUNDS

Evergreen
Money Market Funds

Class A
Class B
Class C
Class I