-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, VdcVupldhcQG3k8ELvmY5fRsTjEOjpgtWwRIZiRXDXycnlYG1lmDYxTCudSl6/pz afHVlDwdZILgsvT15odUhA== 0000891804-00-000035.txt : 20000105 0000891804-00-000035.hdr.sgml : 20000105 ACCESSION NUMBER: 0000891804-00-000035 CONFORMED SUBMISSION TYPE: N-30D PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19991031 FILED AS OF DATE: 20000104 FILER: COMPANY DATA: COMPANY CONFORMED NAME: NUVEEN PREMIER MUNICIPAL INCOME FUND INC CENTRAL INDEX KEY: 0000880845 STANDARD INDUSTRIAL CLASSIFICATION: [] FISCAL YEAR END: 1031 FILING VALUES: FORM TYPE: N-30D SEC ACT: SEC FILE NUMBER: 811-06456 FILM NUMBER: 501207 BUSINESS ADDRESS: STREET 1: 333 WEST WACKER DR CITY: CHICAGO STATE: IL ZIP: 60606 BUSINESS PHONE: 3129178200 N-30D 1 NUVEEN PREMIER MUNI INCOME FUND INC(NPF) Nuveen Exchange-Traded Funds OCTOBER 31, 1999 ANNUAL REPORT DEPENDABLE, TAX-FREE INCOME TO HELP YOU KEEP MORE OF WHAT YOU EARN. NQM Investment Quality NQS Select Quality NQU Quality Income NPF Premier Income Photo of: People looking at view Contents 1 Dear Shareholder 3 Portfolio Managers' Comments 6 NQM's Performance Overview 7 NQS's Performance Overview 8 NQU's Performance Overview 9 NPF's Performance Overview 10 Shareholder Meeting Report 14 Report of Independent Auditors 15 Portfolio of Investments 42 Statement of Net Assets 43 Statement of Operations 44 Statement of Changes in Net Assets 46 Notes to Financial Statements 50 Financial Highlights 52 Build Your Wealth Automatically 53 Fund Information Highlights As of October 31, 1999 Credit Quality Performance Highlights Nuveen Investment Quality Municipal Fund, Inc. (NQM) o Has provided a steady tax-free dividend for 15 consecutive months o Taxable-equivalent yield on share price of 10.45%* Pie Chart: AAA/U.S. Guaranteed 74% AA 11% A 6% BBB/NR 9% Nuveen Select Quality Municipal Fund, Inc. (NQS) o Has provided a steady tax-free dividend for 16 consecutive months o HHHH Four-star Morningstar Rating** Pie Chart: AAA/U.S. Guaranteed 74% AA 6% A 7% BBB/NR 13% Nuveen Quality Income Municipal Fund, Inc. (NQU) o Has provided a steady tax-free dividend for 57 consecutive months o HHHH Four-star Morningstar Rating** Pie Chart: AAA/U.S. Guaranteed 60% AA 17% A 5% BBB/NR 17% Below Investment Grade 1% Nuveen Premier Municipal Income Fund, Inc. (NPF) o Has provided a steady tax-free dividend for 15 consecutive months o HHHH Four-star Morningstar Rating** Pie Chart: AAA/U.S. Guaranteed 59% AA 15% A 10% BBB/NR 15% Below Investment Grade 1% *For investors in the 31% federal income tax bracket. See your fund's performance overview for more information. **Morningstar proprietary ratings reflect historical risk-adjusted performance as of October 31, 1999. The ratings are subject to change every month. Past performance is no guarantee of future results. Morningstar ratings are calculated from the fund's three-, five-, and 10-year average annual returns (if applicable) in excess of 90-day Treasury bill returns with appropriate fee adjustments, and a risk factor that reflects fund performance below 90-day T-bill returns. NQS and NPF received 3 stars for the three-year period and 4 stars for the five-year period. NQU received 4 stars for the three- and five-year periods. The top 10% of the funds in a broad asset class receive 5 stars, the next 22.5% receive 4 stars, and the next 35% receive 3 stars. The funds were rated among 193 funds for the three-year period, 193 funds for the five-year period, and 32 funds for the 10-year period. Photo of Timothy R. Schwertfeger Timothy R. Schwertfeger Chairman of the Board Wealth takes a lifetime to build. Once achieved, it should be preserved. Dear Shareholder I am pleased to report to you on the annual performance of your Nuveen Exchange-Traded Fund. Providing a stable, attractive tax-free dividend is the Fund's main objective, and over the past year, your Fund continued to achieve this goal. During the period covered by this report, we have seen some shifts in the U.S. investment climate and the fixed-income environment in which your Nuveen Exchange-Traded Fund operates. I appreciate the opportunity to review the current investment environment with you, as does the portfolio manager of your Fund, who discusses fund performance later in this report. A CHALLENGING INVESTMENT ENVIRONMENT Over the past 12 months, the U.S. economy continued to be characterized by surprisingly robust growth, benign inflation, and unemployment levels that remained among the lowest in three decades. However, concerns about the persistent pace of the economy's expansion continued to test the new paradigm, which holds that the improvements in productivity achieved through technology enable us to have both economic growth and low inflation at the same time. With investors watching and reacting to each announcement concerning economic statistics, volatility increased, especially in the equity markets, and the spectre of inflation seemed to lurk behind every report. Especially worrisome to the Federal Reserve was the possibility that tight labor markets would eventually have an inflationary effect on wages and, consequently, on consumer prices. In an effort to pre-empt this threat of inflation, the Fed moved to raise interest rates by a quarter-point on three separate occasions between June and November 1999. This brought the federal funds rate - which represents the amount banks charge one another on overnight loans, establishing the standard for other short-term rates - from 4.75% to 5.50%, thereby erasing the three rate cuts enacted by the Fed a year earlier. At its November meeting, the Fed announced that it would shift to a neutral stance following the latest interest rate increase. With Y2K on the horizon, followed by the politics of an election year, investors had some hope that the Fed would put any additional rate hikes on hold. However, the Fed's indication that it would renew its close attention to the rate of economic growth left the door open for another tightening. MUNICIPAL BOND PERFORMANCE Over the past year, our exchange-traded municipal bond funds continued to offer attractive, stable income in a market that places a high premium on yield. At the end of October 1999, the ratio between long-term municipal yields and 30-year Treasury yields stood at 100.3%, compared with the historical average of 86% for the period 1986-1999. For investors, this meant that quality long-term municipal bonds offered yields slightly higher than those of long Treasury bonds - - even before the tax advantages of municipals were taken into account. On an after-tax basis, municipal bonds continued to present an exceptionally attractive investment option relative to Treasuries. During 1999, we have seen the supply of municipal bonds drop off from the near-record levels of 1998. This was largely due to the increase in interest rates, which deterred municipal governments from issuing new debt and removed much of the incentive to refund existing bonds. To date, municipal supply has declined by approximately 20% from the levels of a year ago. This, in turn, has enhanced the attractiveness of the municipal bonds that are brought to market, as demand - especially from individual investors remains strong. We anticipate that this demand will continue to strengthen as investors increasingly look at rebalancing their portfolios. With the outlook for tighter supply and continued demand in the months ahead, Nuveen's established market position as the leading sponsor of exchange-traded municipal bond funds enables us to have excellent access to the bond offerings that have the potential to add value for our shareholders. A BALANCED PORTFOLIO: ENHANCED GROWTH WITH REDUCED RISK If you are like most investors in the market-place today, your goals for tax-free investing probably include capturing high after-tax total returns while moderating risk. To demonstrate the role that municipal bonds can play in achieving this goal, Nuveen tracked a balanced portfolio consisting of equities and municipal bonds and compared its hypothetical investment performance - based on appropriate market indexes and tax rates - with that of a balanced portfolio composed of equities and taxable bonds. Our research showed that, over the past 20 years, the pairing of equities with municipal bonds provided both superior after-tax total returns and lower levels of risk than the combination of equities and taxable bonds. Incorporating even a 20% allocation of municipal bonds into an all-equity portfolio cut risk substantially, with only a small reduction in after-tax total return. Purchasing shares of a Nuveen Exchange-Traded Municipal Bond Fund provides an easy way to incorporate the benefits of municipal bonds into a balanced portfolio. NUVEEN FUNDS: AN ANSWER TO YOUR INVESTMENT NEEDS In light of the recent shifts in the investment environment, your financial adviser can serve as a valuable resource in helping you determine if adjustments are needed in your current asset allocation plan and suggesting investments that can accomplish this goal. By investing in other Nuveen funds, you can bring balance to your portfolio and provide proper exposure to the different types of investments needed to enhance your potential for success. Your adviser can also set up a reinvestment plan designed to purchase additional shares of your Nuveen Exchange-Traded Fund. For more information on Nuveen's expanding array of funds, contact your financial adviser for a prospectus detailing all charges and expenses, or call Nuveen at (800) 621-7227. Please read the prospectus carefully before you invest or send money. THE NEW MILLENNIUM Since this is my last opportunity to talk with you before we enter the new millennium, I wanted to take a moment to discuss the status of Nuveen's preparations for that event. We believe that Nuveen is fully prepared for the upcoming transition, from an operational as well as an investment perspective. During 1999, Nuveen tested all critical operating systems, and we anticipate no problems with year-end processing. As we evaluated potential investments over the year, Nuveen carefully reviewed the progress of each issuer toward Y2K compliance. Last summer, we requested information from the issuers of all bonds in the Funds' portfolios, with special attention to the largest and more volatile holdings. In the following months, we continued to monitor issuers' progress in this area, assisted by securities industry oversight organizations, including the Municipal Securities Rulemaking Board and the Securities and Exchange Commission, as well as rating agencies and insurance companies. Based on our review, we believe that the majority of issuers are Y2K-compliant. The diligence of the financial industry as a whole in dealing with this transition should prove to have ongoing benefits for investors. Since 1898, Nuveen has been synonymous with investments that stand the test of time. As we enter the new millennium, we remain committed to maintaining that reputation and finding the best ways to serve your evolving investment needs. Thank you for your continued confidence. Sincerely, /s/Timothy R. Schwertfeger TIMOTHY R. SCHWERTFEGER Chairman of the Board December 15, 1999 Sidebar text: "Purchasing shares of a Nuveen Exchange-Traded Municipal Bond Fund provides an easy way to incorporate the benefits of municipal bonds into a balanced portfolio." Nuveen Exchange-Traded Funds Portfolio Managers' Comments Portfolio managers Tom Futrell, Rick Huber, Bill Fitzgerald, and Steve Peterson discuss the national municipal market, fund performance, and key investment strategies for the Nuveen national exchange-traded funds. Tom, Bill, and Steve have managed NQM, NQU, and NPF, respectively, since the Funds' inceptions in the early 1990s, while Rick assumed portfolio management duties for NQS in July 1998. WHAT FACTORS CONTRIBUTED TO THE PERFORMANCE OF THE MUNICIPAL MARKET DURING THE PAST 12 MONTHS ENDED OCTOBER 31, 1999? Over the past year, the U.S. economy continued to forge ahead with few signs of slowing. Among the statistics showing surprising strength in recent months was gross domestic product (GDP) growth, which rose 5.5% in the third quarter, well ahead of projections. The growth in GDP was fueled by rising inventories, an improved trade balance, and strong consumer spending, which continues to serve as the main engine powering U.S. economic expansion. Commodity prices, particularly oil and gold, and raw material prices also continued to rise. For the most part, however, these increases did not translate into higher consumer prices. Through the end of October 1999, the Consumer Price Index showed inflation maintaining its low profile, with an annualized increase of 2.8%. Labor markets remained among the tightest in 30 years, as the national unemployment average dropped to 4.1% in October 1999, down from 4.5% in October 1998. Also in October, U.S. personal income surged 1.3%, its biggest jump in more than five years. Concerned about the potential for an overheated economy, the Federal Reserve raised short-term interest rates twice during the fiscal year covered by this report. A third increase, announced November 16, occurred after the reporting period for the Funds. According to the Fed's theory, the impact of the two rate increases on the stock market during the period covered by this report should have caused consumer confidence to fall and consumer spending to slow, thereby pre-empting any reemergence of inflation. Despite the evidence of the Fed's continued vigilance on the inflation front, the cumulative effect of 1999's economic events has been negative for the fixed-income markets, including municipal bonds. HOW DID THESE EVENTS IMPACT SUPPLY AND DEMAND IN THE MUNICIPAL MARKET? For the first 10 months of 1999, municipal supply across the nation fell just over 20% from the levels recorded during the same period in 1998. Some of this decline can be attributed to the rise in interest rates, which discouraged municipalities from issuing long-term debt at higher interest costs. In addition, the refunding activity involving older debt typically declines in a rising interest rate environment. Among the states, California and New York remained the most active issuers in the nation. Although we expect to see adequate municipal supply for the remainder of the year, Y2K concerns are expected to affect the new issuance calendar to some extent. To avoid any potential problems as 1999 turns to 2000, some municipal bond issuers have accelerated this year's issuance, while others have decided to delay issues until next year. Issuance should gradually return to a more normal level following January, with issuance in 2000 expected to be on par with that of 1999. Over recent months, institutional demand for municipal paper has been weakened by several events outside the municipal market. Insurance companies, which have historically been major buyers of municipal bonds, have been hit hard by claims from natural disasters and further hampered by price cutting on insurance premiums in the property casualty sector, which has hurt earnings. At the same time, fund redemptions have limited the demand from mutual fund companies, another major source of institutional demand. In addition, an accelerated corporate bond issuance calendar, timed to avoid any problems with Y2K, resulted in heavy corporate bond supply, which vied with municipal bonds for institutional investor attention. On the other hand, demand from individual investors has been a bright spot for municipal bonds during most of 1999, as investors actively worked to rebalance their portfolios by redirecting assets from equity investments into the fixed-income market. In 1998, individual investors held more than 30% of outstanding municipal debt, making them the largest owner class, and statistics indicate that municipal bond sales to retail investors in 1999 are on track to beat 1998's record levels. HOW DID THE NUVEEN EXCHANGE-TRADED FUNDS PERFORM IN THIS ENVIRONMENT? For the 12 months ended October 31, 1999, the Funds produced total returns on net asset value (NAV) ranging from -6.64% to -3.20%, providing taxable-equivalent total returns1 between -3.87% and -0.20% for shareholders in the 31% federal income tax bracket, as shown in the table on page four. The annual total return for the Funds' benchmark, the Lehman Brothers Municipal Bond Index2, and the average return for their Lipper Peer Group3 are also provided. 1 The taxable-equivalent total return represents the total return that must be earned on a taxable investment in order to equal the total return of the Nuveen fund on an after-tax basis. The taxable-equivalent total return is based on the annualized total return and the 31% federal income tax rate. 2 The national funds are compared with the Lehman Brothers Municipal Bond Index, an unleveraged index comprising a broad range of investment-grade municipal bonds. Results for the index do not reflect any initial or ongoing expenses. 3 The returns for the national funds are compared with the average annualized return of the 46 funds in the Lipper General Leveraged Closed-End Municipal Debt Funds category. Fund and Lipper returns assume reinvestment of dividends. Lehman Lipper Peer Index Total Group Total Return on NAV Return2 Average3 ------------------------------------------------------- 1-Year Ended Taxable- 1-Year Ended 1-Year Ended 10/31/99 Equivalent1 10/31/99 10/31/99 --------------------------------------------------- NQM -6.64% -3.87% -1.78% -6.48% --------------------------------------------------- NQS -4.55% -1.74% -1.78% -6.48% --------------------------------------------------- NQU -3.20% -0.20% -1.78% -6.48% --------------------------------------------------- NPF -3.71% -0.88% -1.78% -6.48% --------------------------------------------------- Past performance is not predictive of future results. For additional information on your Fund, see its individual Performance Overview in this report. The underperformance of the Funds' total returns on NAV relative to their Lehman benchmark can be attributed largely to their durations4. Duration measures a bond fund's price volatility, or reaction to interest rate movements (prices fall when rates rise and vice versa). The longer the duration, the more sensitive the fund's NAV is to changes in interest rates. During a period of falling interest rates, a longer duration enables a fund's NAV to participate more fully in market gains. However, when interest rates rise as they did over the last year, longer duration can make the fund's NAV more vulnerable to price declines. As of October 31, 1999, the Funds' durations ranged from 8.72 to 12.75, compared with 7.52 for the Lehman index. Between November 1, 1998, and October 31, 1999, the yield on the Bond Buyer Revenue Bond Index5 rose from 5.28% to 6.18%. This meant that funds with longer durations, like the Funds in this report, were more likely to underperform the market, as represented by the Lehman Brothers Municipal Bond Index. Over the past 12 months, the durations of the Funds in this report lengthened considerably due to market action, trading activity, and bond calls that removed shorter bonds from each fund. Proceeds from sold or called bonds were reinvested in issues with longer durations. These bonds provided attractive yields and better call protection. Lengthening the Funds' durations should help position the Funds to regain net asset value as the bond market recovers. HOW WERE THE FUNDS' DIVIDENDS AND SHARE PRICES AFFECTED? During the past year, good call protection helped support the dividends of the Funds covered in this report and shield their income from erosion. As of October 31, 1999, NQU had provided shareholders with steady dividends for 57 consecutive months, and NQS had produced 16 consecutive months of stable dividends. Both NQM and NPF had recorded 15 months without a change in dividend. All of these funds continued to provide competitive market yields. In 1999, rising interest rates, inflation worries, and the uncertainty surrounding the timing of the Federal Reserve's moves created a negative environment in the fixed-income markets. In addition, concerns about the impact of the transition to the year 2000 have precipitated an early start to tax-swap season, as investors attempt to offset profits in the equity markets by selling fixed-income investments with embedded losses. All of these factors have negatively impacted the market demand for exchange-traded funds, especially NQS, NQU, and NPF, which had been trading at premiums to their net asset value. This resulted in declines in share price across the board. Since the prevailing interest rate environment in October 1999 was higher than that of a year earlier, the Funds' NAVs also declined, as bond prices fell while interest rates rose. As a result of these factors, NQS, NQU, and NPF saw their premiums (share price above NAV) move to discounts (share price below NAV), and the discount on NQM widened over the past 12 months. Premium/ Total Return Market Yield Discount6 on Share Price --------------------------------------------------------------------------- Taxable- 1-Year Ended Taxable- 10/31/99 Equivalent1 10/31/98 10/31/99 10/31/99 Equivalent1 ------------------------------------------------------------------------ NQM 7.21% 10.45% -3.13% -5.11% -8.51% -5.65% ------------------------------------------------------------------------ NQS 7.27% 10.54% 3.24% -6.58% -13.63% -10.91% ------------------------------------------------------------------------ NQU 7.33% 10.62% 6.21% -2.30% -11.17% -8.35% ------------------------------------------------------------------------ NPF 7.26% 10.52% 8.66% -6.51% -17.25% -14.64% ------------------------------------------------------------------------ WHAT KEY STRATEGIES WERE USED TO MANAGE THE FUNDS DURING THE PAST 12 MONTHS? Over the past fiscal year, these Funds were managed with the goals of supporting and strengthening their long-term dividend capabilities, improving call protection, and enhancing the Funds' tax efficiency by offsetting potential capital gains with capital losses. Enhanced tax efficiency has been an increasing focus for us over the past six months, as the rising interest rate environment offered opportunities to benefit the Funds through active trading. The increased level of recent trading activity is reflected in the transaction volume figure for the Nuveen Exchange-Traded Funds for the third quarter of 1999, which was 10 times that of the same period in 1998. The strategy we are employing involves selling selected bonds that are trading at a loss, recognizing the capital losses, and then rolling the proceeds into bonds with similar characteristics, but offering attractive yields and better call protection. Some of the bonds we sold were due to mature or scheduled to be called within the next few months, while others were bonds that we had purchased earlier this year that were now producing a lower income stream than that recently available in the market. This trading not only gave us capital losses with which to offset current and future capital gains, thereby protecting shareholders from additional taxes, but also - in most cases - increased the net earnings of the Funds. If current market conditions persist, we will continue to focus on implementing this strategy. Although new issue supply in the municipal market declined from last year's levels, we were able to identify attractive bonds in several sectors that added income potential as well as diversification to the Funds. Among the sectors where we found value were utilities and transportation, especially in airport and toll road bonds. In NQM, we also continue to watch the more traditional issuer sectors for value, including water and sewer bonds and general obligation debt. In NQU, we are currently seeing increased opportunities in the transportation sector on the West Coast, particularly California, where transportation infrastructure projects have received little attention for 20 years. Today, increased demand is being met with a growing number of toll road and rail projects. In addition to enhancing diversification, all of these bonds provide 1 The taxable-equivalent yield/total return represents the yield/total return that must be earned on a taxable investment in order to equal the yield/total return of the Nuveen fund on an after-tax basis. The taxable-equivalent yield is based on the fund's current market yield and a federal income tax rate of 31%, while the taxable-equivalent total return is based on the annualized total return and the 31% federal income tax rate. 2 The national funds are compared with the Lehman Brothers Municipal Bond Index, an unleveraged index comprising a broad range of investment-grade municipal bonds. Results for the index do not reflect any initial or ongoing expenses. 3 The returns for the national funds are compared with the average annualized return of the 46 funds in the Lipper General Leveraged Closed-End Municipal Debt Funds category. Fund and Lipper returns assume reinvestment of dividends. 4 Fund duration, also known as leverage-adjusted duration, takes into account the leverag-ing process for each fund and therefore differs from the dura-tion of the actual portfolio of individual bonds that make up the fund. Unless otherwise noted, references to duration in this commentary are intended to indicate fund duration. 5 The Bond Buyer Revenue Bond Index is an unmanaged index of long-term municipal revenue bonds. 6 A fund's premium or discount represents the percentage dif-ference between the fund's share price and its net asset value (NAV). attractive income, with the potential of being an excellent example of the types of purchases we made to support the Funds' dividends. All four funds have holdings in the healthcare sector, which has been beset with concerns about deregulation and profitability. This sector is a dynamic and volatile area of the market and has created credit and rating pressures for certain healthcare organizations and caused some investors to avoid the sector entirely. Since one of Nuveen's strategies is to find value in sectors and bonds that have been overlooked by the rest of the market, the healthcare sector has been an area where Nuveen research and our prudent investment approach enable us to find and exploit opportunities that can add value for our shareholders. As credit spreads (or the difference between higher credit quality securities and those of lower credit quality) widened in recent months, we took advantage of these opportunities to purchase lower-rated hospital issues for NPF. All four funds offer excellent credit quality, with the portion of the Funds' assets invested in bonds rated AAA/U.S. guaranteed and AA ranging from 74% to 85% at the end of October 1999. Each of the Funds has a high percentage (28%-34%) of U.S. guaranteed bonds, representing a large number of pre-refunded and escrowed issues. Over the next six months, shareholders can expect to see those percentages drop between 10% and 15% due to bond calls and sales. The prices of many of the U.S. guaranteed bonds have appreciated to their full extent, and we are taking advantage of opportunities to sell at attractive prices before they are called from our portfolios. The credit quality of the Funds will remain high, however, since these bonds are being replaced with insured and AAA bonds. All four funds also had a substantial allocation (9% to 17%) of BBB and non-rated investment-grade bonds. These lower-rated bonds generally provided enhanced levels of yield, especially as credit spreads widened. Nuveen's research expertise, along with our presence in the national municipal market, means that shareholders can be assured that the credit-worthiness of all issuers is subjected to Nuveen's stringent review process before bonds are purchased for the Funds' portfolios. MuniPreferred shares, which pay short-term interest rates to investors seeking short-term liquidity, are issued by all of the Funds covered in this report. The proceeds from these preferred shares are used to buy additional long-term bonds for the leveraged funds' portfolios. These bonds can generate additional income for the portfolios, but may also increase volatility, including lengthening duration. During the past year, the leverage ratio of each fund fell below the Nuveen guideline of 35%. This led to the issuance of new MuniPreferred shares for NQM and NQU in May and for NQS and NPF in June. Nuveen releveraged the funds both to restore the original leverage ratio of 35% and to provide the potential for increased incremental tax-free income for common shareholders. In the area of bond calls, NPF currently provides excellent levels of call protection, with only 11% of its portfolio subject to calls between now and the end of 2001. This should provide additional protection and stability for the Fund's dividend over this period. However, NQM, NQS, and NQU are now approaching the part of a bond's life when the likelihood of bond calls increases. Ten years after the original issue date, issuers typically have their first opportunity to call, or redeem, outstanding bonds. Calls are more likely to occur if current interest rates are lower than the rates that prevailed when the bonds were first issued. For NQM, the greatest call exposure occurs in 2000, while NQS and NQU will face the majority of calls in 2001. To reduce the impact of calls, we are already at work on strategies for managing through this period. As mentioned earlier, we have been active buyers in the current market as we try to take advantage of the higher interest rate environment. These recent purchases can also benefit the Funds by extending call protection. Given the current level of bond yields, we have been evaluating suitable replacements for older bonds, focusing on bonds that we believe are undervalued and have the potential to support the Funds' dividends and enhance portfolio structure. This should enable us to continue providing a competitive level of dividends for our shareholders. WHAT IS NUVEEN'S OUTLOOK FOR THE FUNDS? In the months ahead, we plan to continue active trading to take advantage of the higher yields currently available in the municipal market and enhance our portfolio holdings and the dividend capabilities of the Funds. Because of strong interest from individual investors, California and New York continue to be good markets for selling bonds. We will also continue working on strategies designed to manage the Funds' call exposure and reduce the impact of bond calls. Currently, that includes selling bonds with short calls and extending the Funds' call protection by buying new issues with favorable call features. While credits spreads remain wider, we will continue to monitor the BBB and non-rated sector, watching for additional opportunities to take advantage of higher yields, especially in NPF. The ability to implement strategies with the potential to benefit the Funds demonstrates the value that can be added by an active bond manager such as Nuveen. As an experienced investment manager knowledgeable about the unique aspects of the municipal market, we are in the marketplace every day, monitoring market dynamics, looking for opportunities, and trying to capitalize on them to the benefit of shareholders. Nuveen Investment Quality Municipal Fund, Inc. Performance Overview As of October 31, 1999 NQM Portfolio Statistics Inception Date 6/90 - -------------------------------------------------- Share Price $13 5/16 - -------------------------------------------------- Net Asset Value $14.03 - -------------------------------------------------- Market Yield 7.21% - -------------------------------------------------- Taxable-Equivalent Yield (Federal Tax Rate)(1) 10.45% - -------------------------------------------------- Fund Net Assets ($000) $802,508 - -------------------------------------------------- Average Effective Maturity (Years) 18.33 - -------------------------------------------------- Leverage-Adjusted Duration 12.75 - -------------------------------------------------- Annualized Total Return On Share Price On NAV - -------------------------------------------------- 1-Year -8.51% -6.64% - -------------------------------------------------- 5-Year 6.76% 5.83% - -------------------------------------------------- Since Inception 5.65% 7.05% - -------------------------------------------------- Taxable-Equivalent Total Return2 On Share Price On NAV - -------------------------------------------------- 1-Year -5.65% -3.87% - -------------------------------------------------- 5-Year 9.91% 8.86% - -------------------------------------------------- Since Inception 8.82% 10.22% - -------------------------------------------------- Top Five Sectors (as a % of total investments) U.S. Guaranteed 29% - -------------------------------------------------- Healthcare 14% - -------------------------------------------------- Water and Sewer 12% - -------------------------------------------------- Housing/Single Family 11% - -------------------------------------------------- Utilities 10% - -------------------------------------------------- 1 Taxable-equivalent yield represents the yield on a taxable investment necessary to equal the yield of the Nuveen fund on an after-tax basis. The federal tax rate is based on the current market yield and a federal income tax rate of 31%. 2 Taxable-equivalent total return is based on the annualized total return and a federal income tax rate of 31%. It represents the return on a taxable investment necessary to equal the return of the Nuveen fund on an after-tax basis. Bar Chart: 1998-1999 Monthly Tax-Free Dividends Per Share November 0.08 December 0.08 January 0.08 February 0.08 March 0.08 April 0.08 May 0.08 June 0.08 July 0.08 August 0.08 September 0.08 October 0.08 Line Chart: Share Price Performance Weekly Closing Price 11/6/98 15.5 15.63 15.94 16.19 16 16.06 16.19 16 15.75 15.69 15.75 15.69 15.63 15.69 15.69 16 16 15.88 15.88 15.88 15.63 15.63 15.81 15.63 15.56 15.25 15.25 15.31 14.94 15.38 14.94 15.25 15.25 15.25 15.06 15.13 14.88 14.19 14.38 14.38 14.19 13.94 13.88 13.63 13.69 13.13 13.06 10/31/99 13.3125 Past performance is not predictive of future results. Nuveen Select Quality Municipal Fund, Inc. Performance Overview As of October 31, 1999 NQS Portfolio Statistics Inception Date 3/91 - -------------------------------------------------- Share Price $13 1/8 - -------------------------------------------------- Net Asset Value $14.05 - -------------------------------------------------- Market Yield 7.27% - -------------------------------------------------- Taxable-Equivalent Yield (Federal Tax Rate)(1) 10.54% - -------------------------------------------------- Fund Net Assets ($000) $755,102 - -------------------------------------------------- Average Effective Maturity (Years) 17.52 - -------------------------------------------------- Leverage-Adjusted Duration 11.20 - -------------------------------------------------- Annualized Total Return On Share Price On NAV - -------------------------------------------------- 1-Year -13.63% -4.55% - -------------------------------------------------- 5-Year 6.80% 6.82% - -------------------------------------------------- Since Inception 5.28% 6.95% - -------------------------------------------------- Taxable-Equivalent Total Return2 On Share Price On NAV - -------------------------------------------------- 1-Year -10.91% -1.74% - -------------------------------------------------- 5-Year 9.91% 9.88% - -------------------------------------------------- Since Inception 8.41% 10.08% - -------------------------------------------------- Top Five Sectors (as a % of total investments) U.S. Guaranteed 28% - -------------------------------------------------- Utilities 16% - -------------------------------------------------- Transportation 11% - -------------------------------------------------- Tax Obligation/General 10% - -------------------------------------------------- Healthcare 7% - -------------------------------------------------- 1 Taxable-equivalent yield represents the yield on a taxable investment necessary to equal the yield of the Nuveen fund on an after-tax basis. The federal tax rate is based on the current market yield and a federal income tax rate of 31%. 2 Taxable-equivalent total return is based on the annualized total return and a federal income tax rate of 31%. It represents the return on a taxable investment necessary to equal the return of the Nuveen fund on an after-tax basis. 3 The Fund also paid shareholders net ordinary income distributions in December 1998 of $0.0029 per share. Bar Chart: 1998-1999 Monthly Tax-Free Dividends Per Share November 0.0795 December 0.0795 January 0.0795 February 0.0795 March 0.0795 April 0.0795 May 0.0795 June 0.0795 July 0.0795 August 0.0795 September 0.0795 October 0.0795 Line Chart: Share Price Performance Weekly Closing Price 11/6/98 16.19 16.31 16.25 16.44 16.44 16.63 16.44 16.06 15.94 15.81 15.81 16 16 15.94 15.94 15.94 15.75 15.75 15.69 15.69 15.63 15.5 15.56 15.5 14.94 14.88 15.06 15 14.75 14.94 14.63 14.94 14.94 14.75 14.63 14 14.31 14.31 14.31 13.75 13.75 13.69 13.69 12.88 12.88 10/31/99 13.125 Past performance is not predictive of future results. Nuveen Quality Income Municipal Fund, Inc. Performance Overview As of October 31, 1999 NQU Portfolio Statistics Inception Date 6/91 - -------------------------------------------------- Share Price $14 - -------------------------------------------------- Net Asset Value $14.33 - -------------------------------------------------- Market Yield 7.33% - -------------------------------------------------- Taxable-Equivalent Yield (Federal Tax Rate)(1) 10.62% - -------------------------------------------------- Fund Net Assets ($000) $1,228,845 - -------------------------------------------------- Average Effective Maturity (Years) 16.31 - -------------------------------------------------- Leverage-Adjusted Duration 8.72 - -------------------------------------------------- Annualized Total Return On Share Price On NAV - -------------------------------------------------- 1-Year -11.17% -3.20% - -------------------------------------------------- 5-Year 8.64% 7.09% - -------------------------------------------------- Since Inception 6.02% 7.17% - -------------------------------------------------- Taxable-Equivalent Total Return2 On Share Price On NAV - -------------------------------------------------- 1-Year -8.35% -0.20% - -------------------------------------------------- 5-Year 11.79% 10.20% - -------------------------------------------------- Since Inception 9.16% 10.30% - -------------------------------------------------- Top Five Sectors (as a % of total investments) U.S. Guaranteed 34% - -------------------------------------------------- Transportation 14% - -------------------------------------------------- Housing/Single Family 10% - -------------------------------------------------- Tax Obligation/General 9% - -------------------------------------------------- Utilities 9% - -------------------------------------------------- 1 Taxable-equivalent yield represents the yield on a taxable investment necessary to equal the yield of the Nuveen fund on an after-tax basis. The federal tax rate is based on the current market yield and a federal income tax rate of 31%. 2 Taxable-equivalent total return is based on the annualized total return and a federal income tax rate of 31%. It represents the return on a taxable investment necessary to equal the return of the Nuveen fund on an after-tax basis. Bar Chart: 1998-1999 Monthly Tax-Free Dividends Per Share November 0.0855 December 0.0855 January 0.0855 February 0.0855 March 0.0855 April 0.0855 May 0.0855 June 0.0855 July 0.0855 August 0.0855 September 0.0855 October 0.0855 Line Chart: Share Price Performance Weekly Closing Price 11/6/98 16.88 17.06 16.94 17.06 17.25 17.19 17.13 16.81 16.88 16.19 16.44 16.56 16.63 16.63 16.63 16.69 16.44 16.38 16.38 16.63 16.31 16.38 16.44 16.56 16.13 15.88 15.69 15.69 15.56 15.75 15.5 15.81 16.13 15.94 15.81 15.75 15.5 15.06 15.13 15.31 15.19 15.06 14.81 14.88 14.88 13.75 13.69 10/31/99 14 Past performance is not predictive of future results. Nuveen Premier Municipal Income Fund, Inc. Performance Overview As of October 31, 1999 NPF Portfolio Statistics Inception Date 12/91 - -------------------------------------------------- Share Price $13 5/16 - -------------------------------------------------- Net Asset Value $14.24 - -------------------------------------------------- Market Yield 7.26% - -------------------------------------------------- Taxable-Equivalent Yield (Federal Tax Rate)(1) 10.52% - -------------------------------------------------- Fund Net Assets ($000) $450,509 - -------------------------------------------------- Average Effective Maturity (Years) 13.45 - -------------------------------------------------- Leverage-Adjusted Duration 10.59 - -------------------------------------------------- Annualized Total Return On Share Price On NAV - -------------------------------------------------- 1-Year -17.25% -3.71% - -------------------------------------------------- 5-Year 7.90% 7.24% - -------------------------------------------------- Since Inception 5.23% 6.99% - -------------------------------------------------- Taxable-Equivalent Total Return2 On Share Price On NAV - -------------------------------------------------- 1-Year -14.64% -0.88% - -------------------------------------------------- 5-Year 10.98% 10.29% - -------------------------------------------------- Since Inception 8.25% 10.00% - -------------------------------------------------- Top Five Sectors (as a % of total investments) U.S. Guaranteed 32% - -------------------------------------------------- Housing/Multifamily 14% - -------------------------------------------------- Tax Obligation/Limited 11% - -------------------------------------------------- Tax Obligation/General 9% - -------------------------------------------------- Healthcare 9% - -------------------------------------------------- 1 Taxable-equivalent yield represents the yield on a taxable investment necessary to equal the yield of the Nuveen fund on an after-tax basis. The federal tax rate is based on the current market yield and a federal income tax rate of 31%. 2 Taxable-equivalent total return is based on the annualized total return and a federal income tax rate of 31%. It represents the return on a taxable investment necessary to equal the return of the Nuveen fund on an after-tax basis. 3 The Fund also paid shareholders capital gains distributions in December 1998 of $0.0023 per share. Bar Chart: 1998-1999 Monthly Tax-Free Dividends Per Share November 0.0805 December 0.0805 January 0.0805 February 0.0805 March 0.0805 April 0.0805 May 0.0805 June 0.0805 July 0.0805 August 0.0805 September 0.0805 October 0.0805 Pie Chart: Share Price Performance Weekly Closing Price 11/6/98 17.31 17.25 17.13 17.19 16.64 17 16.88 16.63 16.5 16.44 16.31 16.38 16.25 16.44 16.19 16.25 16 15.94 16.06 15.9375 15.88 16 16.13 16.13 15.81 15.81 15.63 15.56 15.31 15.38 15 15.19 15.25 15.31 15.19 15 15.13 14.88 14.5 14.5 14.5 14.38 14.19 14.13 13.69 13.19 13.13 10/31/99 13.31 Past performance is not predictive of future results. Shareholder Meeting Report The Shareholder Meeting was held July 28, 1999.
NQM - ------------------------------------------------------------------------------------------------------------------------------------ Approval of the Directors was reached as follows: Preferred Preferred Preferred Preferred Preferred Common Shares Shares Shares Shares Shares Shares Series-M Series-T Series-W Series-TH Series-F - ------------------------------------------------------------------------------------------------------------------------------------ Robert P. Bremner For 31,054,882 2,188 1,941 1,845 2,040 2,046 Withhold 340,482 8 4 -- -- 34 - ------------------------------------------------------------------------------------------------------------------------------------ Total 31,395,364 2,196 1,945 1,845 2,040 2,080 ==================================================================================================================================== Lawrence H. Brown For 31,064,728 2,193 1,941 1,845 2,040 2,046 Withhold 330,636 3 4 -- -- 34 - ------------------------------------------------------------------------------------------------------------------------------------ Total 31,395,364 2,196 1,945 1,845 2,040 2,080 ==================================================================================================================================== Anne E. Impellizzeri For 31,080,241 2,193 1,941 1,845 2,040 2,046 Withhold 315,123 3 4 -- -- 34 - ------------------------------------------------------------------------------------------------------------------------------------ Total 31,395,364 2,196 1,945 1,845 2,040 2,080 ==================================================================================================================================== Peter R. Sawers For 31,091,265 2,193 1,944 1,845 2,040 2,046 Withhold 304,099 3 1 -- -- 34 - ------------------------------------------------------------------------------------------------------------------------------------ Total 31,395,364 2,196 1,945 1,845 2,040 2,080 ==================================================================================================================================== William J. Schneider For -- 2,187 1,941 1,845 2,040 2,046 Withhold -- 9 4 -- -- 34 - ------------------------------------------------------------------------------------------------------------------------------------ Total -- 2,196 1,945 1,845 2,040 2,080 ==================================================================================================================================== Timothy R. Schwertfeger For -- 2,188 1,941 1,845 2,040 2,046 Withhold -- 8 4 -- -- 34 - ------------------------------------------------------------------------------------------------------------------------------------ Total -- 2,196 1,945 1,845 2,040 2,080 ==================================================================================================================================== Judith M. Stockdale For 31,100,300 2,193 1,944 1,845 2,040 2,046 Withhold 295,064 3 1 -- -- 34 - ------------------------------------------------------------------------------------------------------------------------------------ Total 31,395,364 2,196 1,945 1,845 2,040 2,080 ==================================================================================================================================== Ratification of auditors was reached as follows: For 31,018,254 2,193 1,940 1,845 2,030 2,046 Against 116,941 3 5 -- 10 -- Abstain 260,169 -- -- -- -- 34 - ------------------------------------------------------------------------------------------------------------------------------------ Total 31,395,364 2,196 1,945 1,845 2,040 2,080 ====================================================================================================================================
Shareholder Meeting Report
NQS - ------------------------------------------------------------------------------------------------------------------------------------ Approval of the Directors was reached as follows: Preferred Preferred Preferred Preferred Common Shares Shares Shares Shares Shares Series-M Series-T Series-W Series-F - ------------------------------------------------------------------------------------------------------------------------------------ Robert P. Bremner For 30,824,188 1,825 1,855 2,256 2,519 Withhold 363,772 12 63 28 2 - ------------------------------------------------------------------------------------------------------------------------------------ Total 31,187,960 1,837 1,918 2,284 2,521 ==================================================================================================================================== Lawrence H. Brown For 30,840,318 1,825 1,855 2,256 2,519 Withhold 347,642 12 63 28 2 - ------------------------------------------------------------------------------------------------------------------------------------ Total 31,187,960 1,837 1,918 2,284 2,521 ==================================================================================================================================== Anne E. Impellizzeri For 30,846,087 1,825 1,855 2,256 2,519 Withhold 341,873 12 63 28 2 - ------------------------------------------------------------------------------------------------------------------------------------ Total 31,187,960 1,837 1,918 2,284 2,521 ==================================================================================================================================== Peter R. Sawers For 30,875,299 1,825 1,855 2,259 2,519 Withhold 312,661 12 63 25 2 - ------------------------------------------------------------------------------------------------------------------------------------ Total 31,187,960 1,837 1,918 2,284 2,521 ==================================================================================================================================== William J. Schneider For -- 1,825 1,855 2,255 2,519 Withhold -- 12 63 29 2 - ------------------------------------------------------------------------------------------------------------------------------------ Total -- 1,837 1,918 2,284 2,521 ==================================================================================================================================== Timothy R. Schwertfeger For -- 1,825 1,855 2,255 2,519 Withhold -- 12 63 29 2 - ------------------------------------------------------------------------------------------------------------------------------------ Total -- 1,837 1,918 2,284 2,521 ==================================================================================================================================== Judith M. Stockdale For 30,879,989 1,825 1,855 2,259 2,519 Withhold 307,971 12 63 25 2 - ------------------------------------------------------------------------------------------------------------------------------------ Total 31,187,960 1,837 1,918 2,284 2,521 ==================================================================================================================================== Ratification of auditors was reached as follows: For 30,792,638 1,834 1,907 2,281 2,519 Against 119,310 -- 10 3 -- Abstain 276,012 3 1 -- 2 - ------------------------------------------------------------------------------------------------------------------------------------ Total 31,187,960 1,837 1,918 2,284 2,521 ====================================================================================================================================
Shareholder Meeting Report NQU - ------------------------------------------------------------------------------------------------------------------------------------ Approval of the Directors was reached as follows: Preferred Preferred Preferred Preferred Preferred Preferred Common Shares Shares Shares Shares Shares Shares Shares Series-M Series-T Series-W Series-W2 Series-TH Series-F - ------------------------------------------------------------------------------------------------------------------------------------ Robert P. Bremner For 48,533,729 2,350 2,693 2,428 2,064 3,481 2,608 Withhold 505,417 2 9 26 14 17 1 - ------------------------------------------------------------------------------------------------------------------------------------ Total 49,039,146 2,352 2,702 2,454 2,078 3,498 2,609 ==================================================================================================================================== Lawrence H. Brown For 48,578,803 2,350 2,693 2,428 2,064 3,481 2,608 Withhold 460,343 2 9 26 14 17 1 - ------------------------------------------------------------------------------------------------------------------------------------ Total 49,039,146 2,352 2,702 2,454 2,078 3,498 2,609 ==================================================================================================================================== Anne E. Impellizzeri For 48,608,488 2,350 2,693 2,428 2,064 3,481 2,608 Withhold 430,658 2 9 26 14 17 1 - ------------------------------------------------------------------------------------------------------------------------------------ Total 49,039,146 2,352 2,702 2,454 2,078 3,498 2,609 ==================================================================================================================================== Peter R. Sawers For 48,626,077 2,351 2,693 2,428 2,064 3,481 2,608 Withhold 413,069 1 9 26 14 17 1 - ------------------------------------------------------------------------------------------------------------------------------------ Total 49,039,146 2,352 2,702 2,454 2,078 3,498 2,609 ==================================================================================================================================== William J. Schneider For -- 2,350 2,683 2,428 2,064 3,481 2,608 Withhold -- 2 19 26 14 17 1 - ------------------------------------------------------------------------------------------------------------------------------------ Total -- 2,352 2,702 2,454 2,078 3,498 2,609 ==================================================================================================================================== Timothy R. Schwertfeger For -- 2,350 2,683 2,428 2,064 3,481 2,608 Withhold -- 2 19 26 14 17 1 - ------------------------------------------------------------------------------------------------------------------------------------ Total -- 2,352 2,702 2,454 2,078 3,498 2,609 ==================================================================================================================================== Judith M. Stockdale For 48,631,024 2,351 2,693 2,428 2,064 3,481 2,608 Withhold 408,122 1 9 26 14 17 1 - ------------------------------------------------------------------------------------------------------------------------------------ Total 49,039,146 2,352 2,702 2,454 2,078 3,498 2,609 ==================================================================================================================================== Ratification of auditors was reached as follows: For 48,503,070 2,335 2,690 2,421 2,078 3,492 2,608 Against 167,593 1 2 33 -- -- 1 Abstain 368,483 16 10 -- -- 6 -- - ------------------------------------------------------------------------------------------------------------------------------------ Total 49,039,146 2,352 2,702 2,454 2,078 3,498 2,609 ====================================================================================================================================
Shareholder Meeting Report NPF - ------------------------------------------------------------------------------------------------------------------------------------ Approval of the Directors was reached as follows: Preferred Preferred Common Shares Shares Shares Series-T Series-TH - ------------------------------------------------------------------------------------------------------------------------------------ Robert P. Bremner For 18,279,738 2,218 2,446 Withhold 170,257 40 13 - ------------------------------------------------------------------------------------------------------------------------------------ Total 18,449,995 2,258 2,459 ==================================================================================================================================== Lawrence H. Brown For 18,299,817 2,218 2,446 Withhold 150,178 40 13 - ------------------------------------------------------------------------------------------------------------------------------------ Total 18,449,995 2,258 2,459 ==================================================================================================================================== Anne E. Impellizzeri For 18,315,899 2,218 2,446 Withhold 134,096 40 13 - ------------------------------------------------------------------------------------------------------------------------------------ Total 18,449,995 2,258 2,459 ==================================================================================================================================== Peter R. Sawers For 18,316,849 2,218 2,446 Withhold 133,146 40 13 - ------------------------------------------------------------------------------------------------------------------------------------ Total 18,449,995 2,258 2,459 ==================================================================================================================================== William J. Schneider For -- 2,218 2,446 Withhold -- 40 13 - ------------------------------------------------------------------------------------------------------------------------------------ Total -- 2,258 2,459 ==================================================================================================================================== Timothy R. Schwertfeger For -- 2,218 2,446 Withhold -- 40 13 - ------------------------------------------------------------------------------------------------------------------------------------ Total -- 2,258 2,459 ==================================================================================================================================== Judith M. Stockdale For 18,319,703 2,218 2,446 Withhold 130,292 40 13 - ------------------------------------------------------------------------------------------------------------------------------------ Total 18,449,995 2,258 2,459 ==================================================================================================================================== Ratification of auditors was reached as follows: For 18,231,797 2,200 2,432 Against 90,854 -- 26 Abstain 127,344 58 1 - ------------------------------------------------------------------------------------------------------------------------------------ Total 18,449,995 2,258 2,459 ====================================================================================================================================
Report of Independent Auditors The Board of Directors and Shareholders Nuveen Investment Quality Municipal Fund, Inc. Nuveen Select Quality Municipal Fund, Inc. Nuveen Quality Income Municipal Fund, Inc. Nuveen Premier Municipal Income Fund, Inc. We have audited the accompanying statements of net assets, including the portfolios of investments, of Nuveen Investment Quality Municipal Fund, Inc., Nuveen Select Quality Municipal Fund, Inc., Nuveen Quality Income Municipal Fund, Inc. and Nuveen Premier Municipal Income Fund, Inc. as of October 31, 1999, and the related statements of operations, changes in net assets and the financial highlights for the years indicated therein. These financial statements and financial highlights are the responsibility of the Funds' management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of investments owned as of October 31, 1999, by correspondence with the custodian and brokers. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial positions of Nuveen Investment Quality Municipal Fund, Inc., Nuveen Select Quality Municipal Fund, Inc., Nuveen Quality Income Municipal Fund, Inc. and Nuveen Premier Municipal Income Fund, Inc. at October 31, 1999, and the results of their operations, changes in their net assets and financial highlights for the years indicated therein in conformity with generally accepted accounting principles. /s/ Ernst & Young LLP Chicago, Illinois December 15, 1999 Portfolio of Investments NUVEEN INVESTMENT QUALITY MUNICIPAL FUND, INC. (NQM) October 31,1999
Principal Optional Call Market Amount Description Provisions* Ratings** Value - ------------------------------------------------------------------------------------------------------------------------------------ Alabama - 3.7% $ 22,225,000 Jefferson County, Alabama, Sewer Revenue Capital Improvement 2/09 at 101 AAA $ 21,154,200 Warrants, Series 1999-A, 5.750%, 2/01/38 10,000,000 BMC Special Care Facilities Financing Authority of the City of 11/08 at 101 AAA 8,355,600 Montgomery (Alabama), Revenue Bonds, Series 1998-B (Baptist Health), 5.000%, 11/15/29 - ------------------------------------------------------------------------------------------------------------------------------------ Alaska - 1.8% 14,850,000 Alaska Housing Finance Corporation, General Housing Purpose Bonds, 6/04 at 102 Aa2 14,213,826 1994 Series A, 5.400%, 12/01/13 - ------------------------------------------------------------------------------------------------------------------------------------ Arkansas - 0.7% 6,535,000 Arkansas Development Finance Authority, Home Mortgage 7/08 at 101 1/2 AAA 5,931,689 Revenue Bonds, 1998 Series A, 5.150%, 7/01/17 - ------------------------------------------------------------------------------------------------------------------------------------ California - 12.2% 9,455,000 County of Alameda, California, Alameda County Public Facilities 9/06 at 102 AAA 9,517,781 Corporation, Certificates of Participation (1991 Financing Project), 6.000%, 9/01/21 22,400,000 California Health Facilities Financing Authority, Kaiser Permanente 5/03 at 102 A 20,151,040 Revenue Bonds, 1993 Series C, 5.600%, 5/01/33 4,625,000 California Health Facilities Financing Authority, Hospital Revenue 6/01 at 102 Aaa 4,935,708 Bonds (Children's Hospital of Los Angeles), 1991 Series A, 7.125%, 6/01/21 (Pre-refunded to 6/01/01) 5,925,000 State Public Works Board of the State of California, Lease Revenue 6/03 at 102 Aa3 5,531,402 Refunding Bonds (The Regents of the University of California), 1993 Series A (Various University of California Projects), 5.500%, 6/01/21 9,740,000 Huntington Park Redevelopment Agency, Single Family Residential No Opt. Call AAA 12,068,152 Mortgage Revenue Refunding Bonds, 1986 Series A, 8.000%, 12/01/19 4,000,000 City of Loma Linda, California, Hospital Revenue Bonds 12/03 at 102 N/R 3,835,400 (Loma Linda University Medical Center Project), Series 1993-A, 6.500%, 12/01/18 7,155,000 Department of Water and Power of the City of Los Angeles, 5/03 at 102 AAA 5,768,433 Water Works Refunding Revenue Bonds, Second Issue of 1993, 4.500%, 5/15/23 1,030,000 Natomas Unified School District (County of Sacramento, California), No Opt. Call AAA 1,052,114 1999 Refunding General Obligation Bonds, 5.950%, 9/01/21 15,770,000 Ontario Redevelopment Financing Authority (San Bernardino County, No Opt. Call AAA 19,084,223 California), 1995 Revenue Refunding Bonds (Ontario Redevelopment Project No.1), 7.400%, 8/01/25 13,145,000 City of Perris, California, Single Family Mortgage Revenue Bonds No Opt. Call AAA 16,042,684 (GNMA Mortgage-Backed Securities), 1988 Series B, 8.200%, 9/01/23 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ Colorado - 5.2% 4,940,000 Castle Pines Metropolitan District, Douglas County, Colorado, 12/00 at 102 AAA 5,231,361 General Obligation Refunding and Improvement Bonds, Series 1990, 7.625%, 12/01/15 (Pre-refunded to 12/01/00) 1,895,000 Colorado Housing Finance Authority, Single Family Program Senior and 5/06 at 105 Aa2 2,092,819 Subordinate Bonds, 1996 Series B, 7.450%, 11/01/27 City and County of Denver, Colorado, Airport System Revenue Bonds, Series 1991A: 820,000 8.000%, 11/15/25 (Alternative Minimum Tax) (Pre-refunded to 11/15/01) 11/01 at 100 Aaa 879,499 2,265,000 8.000%, 11/15/25 (Alternative Minimum Tax) 11/01 at 100 BBB+ 2,382,418 26,000,000 City and County of Denver, Colorado, Airport System Revenue Bonds, 11/08 at 101 AAA 22,245,860 Series 1998B, 5.000%, 11/15/25 7,865,000 Colorado Springs School District No. 11, El Paso County, Colorado, 12/07 at 125 AA- 9,029,335 General Obligation Improvement Bonds, Series 1996, 7.125%, 12/01/21 Principal Optional Call Market Amount Description Provisions* Ratings** Value - ------------------------------------------------------------------------------------------------------------------------------------ Connecticut - 2.0% Connecticut Housing Finance Authority, Housing Mortgage Finance Program Bonds, 1997 Series C: $ 1,000,000 5.700%, 11/15/17 (Alternative Minimum Tax) 11/07 at 102 AA $ 973,720 8,520,000 5.850%, 11/15/28 (Alternative Minimum Tax) 11/07 at 102 AA 8,209,105 6,985,000 Connecticut Housing Finance Authority, Housing Mortgage Finance 5/06 at 102 AA 7,067,772 Program Bonds, 1996 Series D, Subseries D-2, 6.200%, 11/15/27 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ District of Columbia - 3.2% 2,500,000 District of Columbia (Washington, D.C.), General Obligation Bonds, No Opt. Call AAA 2,530,025 Series 1998B, 6.000%, 6/01/16 5,205,000 District of Columbia Housing Finance Agency, Collateralized Single 12/00 at 102 AAA 5,412,523 Family Mortgage Revenue Bonds, Series 1990A, 8.100%, 12/01/23 (Alternative Minimum Tax) 18,645,000 District of Columbia Water and Sewer Authority, Public Utility 4/09 at 160 AAA 17,614,677 Revenue Bonds, Series 1998, 5.500%, 10/01/23 - ------------------------------------------------------------------------------------------------------------------------------------ Florida - 3.9% 4,000,000 Hillsborough County Port District, Florida, Tampa Port Authority 12/00 at 102 Baa1*** 4,257,720 Revenue Bonds, Series 1990, 8.250%, 6/01/09 (Pre-refunded to 12/01/00) 20,000,000 Jacksonville Health Facilities Authority, Health Facilities Revenue 11/00 at 102 Aaa 21,087,600 Refunding Bonds, Daughters of Charity National Health System, Inc., St. Vincent's Medical Center Issue, Series 1990, 7.500%, 11/01/15 (Pre-refunded to 11/01/00) 7,500,000 City of Miami Beach Health Facilities Authority, Hospital Revenue 11/08 at 101 BBB 6,177,750 Bonds, Series 1998 (Mount Sinai Medical Center of Florida Project), 5.375%, 11/15/28 - ------------------------------------------------------------------------------------------------------------------------------------ Georgia - 4.1% 15,420,000 City of Atlanta (Georgia), Water and Wastewater Revenue Bonds, 5/09 at 101 AAA 12,876,625 Series 1999A, 5.000%, 11/01/38 2,250,000 Municipal Electric Authority of Georgia, Project One Special Obligation No Opt. Call A 2,360,093 Bonds, Fourth Crossover Series, 6.500%, 1/01/20 10,000,000 Development Authority of Monroe County (Georgia), Pollution Control 4/00 at 102 A+ 10,209,400 Revenue Bonds (Georgia Power Company, Plant Scherer Project), Second Series 1994, 6.750%, 10/01/24 7,325,000 Wayne County Development Authority, Solid Waste Disposal 7/00 at 102 Baa2 7,560,206 Revenue Bonds (ITT Rayonier, Inc. Project), Series 1990, 8.000%, 7/01/15 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ Illinois - 4.8% 6,720,000 City of Chicago, Chicago O'Hare International Airport, Special Facility 11/00 at 102 Baa2 6,998,611 Revenue Bonds (American Airlines, Inc. Project), Series 1990A, 7.875%, 11/01/25 (Alternative Minimum Tax) 7,500,000 Community College District No. 508, Cook County, Illinois, No Opt. Call AAA 9,086,175 Certificates of Participation, 8.750%, 1/01/07 3,305,000 Illinois Health Facilities Authority, Revenue Bonds, Series 1990 11/00 at 102 A3*** 3,480,462 (Riverside Senior Living Center Project), 7.500%, 11/01/20 (Pre-refunded to 11/01/00) 5,900,000 Community Unit School District Number 7, Madison County, Illinois, No Opt. Call AAA 6,117,297 School Building Bonds, Series 1994, 5.850%, 2/01/13 3,585,000 City of Pekin, Illinois, Multifamily Housing Refunding Revenue Bonds, 5/03 at 103 AAA 3,712,913 Series 1992A (FHA-Insured Mortgage Loan - Section 8 Assisted Project), 6.875%, 5/01/22 1,430,000 City of Peoria, Peoria County, City of Pekin, Tazewell and Peoria 8/00 at 103 AA+ 1,440,067 Counties, and City of Waukegan, Lake County (Illinois), Jointly, GNMA Collateralized Mortgage Revenue Bonds, Series 1990, 7.875%, 8/01/22 (Alternative Minimum Tax) 5,390,000 Regional Transportation Authority, Cook, DuPage, Kane, Lake, McHenry No Opt. Call AAA 6,685,325 and Will Counties, Illinois, General Obligation Bonds, Series 1992A, 9.000%, 6/01/07 860,000 Regional Transportation Authority, Cook, DuPage, Kane, Lake, No Opt. Call AAA 1,066,675 McHenry and Will Counties, Illinois, General Obligation Bonds, Series 1992B, 9.000%, 6/01/07 - ------------------------------------------------------------------------------------------------------------------------------------ Indiana - 0.8% 6,000,000 Hospital Authority of Delaware County (Indiana), Hospital Revenue 8/01 at 102 AAA 6,353,220 Bonds, Series 1991 (Ball Memorial Hospital), 6.625%, 8/01/16 (Pre-refunded to 8/01/01) Principal Optional Call Market Amount Description Provisions* Ratings** Value - ------------------------------------------------------------------------------------------------------------------------------------ Kansas - 1.3% $ 4,070,000 Sedgwick and Shawnee Counties, Kansas, Single Family No Opt. Call Aaa $ 4,389,739 Mortgage Revenue Bonds(Mortgaged-Backed Securities Program), 1997 Series A-1, 6.950%, 6/01/29 (Alternative Minimum Tax) 4,760,000 City of Topeka, Kansas, Industrial Revenue Refunding Bonds, 8/16 at 100 AAA 6,280,344 Series 1988 (Sunwest Hotel Corporation Project), 9.500%, 10/01/16 (Pre-refunded to 8/15/16) (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ Kentucky - 2.1% 12,500,000 County of Jefferson, Kentucky, Pollution Control Revenue Bonds, 4/05 at 102 Aa2 12,289,250 1995 Series A (Louisville Gas and Electric Company Project), 5.900%, 4/15/23 1,170,000 Kentucky Housing Corporation, Housing Revenue Bonds 7/00 at 102 AAA 1,204,831 (FHA-Insured/VA Guaranteed), 1990 Series C, 8.100%, 1/01/22 (Alternative Minimum Tax) 3,700,000 County of Warren, Kentucky, Hospital Revenue Bonds, Series 1998 4/08 at 101 AAA 3,033,889 (Bowling Green-Warren County Community Hospital Corporation), 4.875%, 4/01/27 - ------------------------------------------------------------------------------------------------------------------------------------ Louisiana - 3.5% 4,065,000 East Baton Rouge Mortgage Finance Authority, Single Family Mortgage 8/00 at 102 Aaa 4,175,243 Revenue Bonds (GNMA Mortgage Backed Securities Program), Series 1990A, 7.875%, 8/01/23 (Alternative Minimum Tax) 4,595,000 East Baton Rouge Mortgage Finance Authority, Single Family 10/07 at 102 Aaa 4,374,578 Mortgage Revenue Refunding Bonds (GNMA and FNMA Mortgage-Backed Securities Program), Series 1997D, 5.900%, 10/01/30 (Alternative Minimum Tax) 3,950,000 Louisiana Public Facilities Authority, Extended Care Facilities No Opt. Call BBB 4,422,776 Revenue Bonds (Comm-Care Corporation Project), Series 1994, 11.000%, 2/01/04 11,545,000 Orleans Parish School Board, Public School Refunding Bonds, No Opt. Call AAA 14,798,035 Series 1987, 9.000%, 2/01/09 - ------------------------------------------------------------------------------------------------------------------------------------ Maine - 0.4% 3,095,000 Maine State Housing Authority, Mortgage Purchase Bonds, 10/04 at 102 AA 3,230,530 1994 Series C-2, 6.875%, 11/15/23 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ Maryland - 0.3% 2,000,000 City of Gaithersburg (Maryland), First Mortgage Economic Development 1/00 at 102 N/R*** 2,052,580 Revenue Bonds (Asbury Methodist Home, Incorporated Facility), Series 1990, 7.850%, 1/01/20 (Pre-refunded to 1/01/00) - ------------------------------------------------------------------------------------------------------------------------------------ Massachusetts - 10.1% 16,250,000 City of Boston, Massachusetts, Revenue Bonds, Boston City Hospital 8/00 at 102 Aaa 17,005,138 (FHA-Insured Mortgage), Series A, 7.625%, 2/15/21 (Pre-refunded to 8/15/00) Massachusetts Health and Educational Facilities Authority, Revenue Bonds, Goddard Memorial Hospital Issue, Series B: 3,810,000 9.000%, 7/01/15 (Pre-refunded to 7/01/00) 7/00 at 102 Aaa 4,011,701 5,450,000 9.000%, 7/01/15 7/00 at 102 BBB 5,656,773 20,750,000 Massachusetts Turnpike Authority, Metropolitan Highway System 1/09 at 101 AAA 17,243,043 Revenue Bonds, 1999 Series A (Subordinated), 5.000%, 1/01/39 Massachusetts Water Resources Authority, General Revenue Bonds, 1990 Series A: 15,000,000 7.625%, 4/01/14 (Pre-refunded to 4/01/00) 4/00 at 102 AAA 15,530,700 4,000,000 7.500%, 4/01/16 (Pre-refunded to 4/01/00) 4/00 at 102 AAA 4,139,440 4,000,000 Massachusetts Water Resources Authority, General Revenue 3/03 at 100 AAA 3,477,760 Refunding Bonds, Series 1993, 5.000%, 3/01/22 16,050,000 Massachusetts Water Resources Authority, General Revenue 8/08 at 101 AAA 13,817,285 Refunding Bonds, 1997 Series D, 5.000%, 8/01/24 - ------------------------------------------------------------------------------------------------------------------------------------ Michigan - 1.7% 3,650,000 School District of the City of Detroit, Wayne County, Michigan, 5/09 at 101 AAA 2,968,983 School Building and Site Improvement Bonds (Unlimited Tax General Obligation), Series 1998A, 4.750%, 5/01/28 10,000,000 City of Detroit, Michigan, Water Supply System Revenue and No Opt. Call AAA 10,793,800 Revenue Refunding Bonds, Series 1993, 6.500%, 7/01/15 Principal Optional Call Market Amount Description Provisions* Ratings** Value - ------------------------------------------------------------------------------------------------------------------------------------ Minnesota - 1.2% $ 5,000,000 The Dakota County Housing and Redevelopment Authority, the No Opt. Call AAA $ 6,368,650 Washington County Housing and Redevelopment Authority, and the City of Bloomington, Minnesota, Single Family Residential Mortgage Revenue Bonds (Mortgage Backed Program), Series 1988, 8.450%, 9/01/19 (Alternative Minimum Tax) 2,860,000 City of Hopkins, Minnesota, Elderly Housing Revenue Refunding 3/04 at 102 AAA 3,098,839 Bonds (St. Therese Southwest, Inc. Project), Series 1994A, 6.500%, 3/01/19 (Pre-refunded to 3/01/04) - ------------------------------------------------------------------------------------------------------------------------------------ Mississippi - 0.3% 1,495,000 Mississippi Housing Finance Corporation, Single Family Mortgage 4/00 at 102 AAA 1,526,978 Purchase Revenue Bonds, Series 1989 (GNMA Mortgage-Backed Securities Program), 8.250%, 10/15/18 (Alternative Minimum Tax) 630,000 Mississippi Home Corporation, Single Family Senior Revenue 9/00 at 103 AAA 657,336 Refunding Bonds, Series 1990A, 9.250%, 3/01/12 - ------------------------------------------------------------------------------------------------------------------------------------ Missouri - 0.3% 2,045,000 Missouri Housing Development Commission, Single Family Mortgage 3/07 at 105 AAA 2,230,850 Revenue Bonds (Homeownership Loan Program), 1997 Series A-2, 7.300%, 3/01/28 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ Nebraska - 2.1% 3,300,000 Nebraska Higher Education Loan Program, Inc., Student Loan Program 3/04 at 102 AAA 3,267,957 Revenue Bonds, 1993 Series B, 5.875%, 6/01/14 (Alternative Minimum Tax) 13,330,000 Nebraska Investment Finance Authority, Single Family Housing 3/05 at 101 1/2 AAA 13,522,752 Revenue Bonds, 1995 Series B, 6.450%, 3/01/35 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ New York - 10.8% 7,770,000 Metropolitan Transportation Authority, Commuter Facilities Revenue 7/07 at 101 AAA 7,083,521 Bonds, Series 1997C, 5.375%, 7/01/27 The City of New York, General Obligation Bonds, Fiscal 1997 Series G: 95,000 6.000%, 10/15/26 (Pre-refunded to 10/15/07) 10/07 at 101 A-*** 102,107 9,905,000 6.000%, 10/15/26 10/07 at 101 A- 9,819,718 7,000,000 New York City Municipal Water Finance Authority, Water and Sewer 6/06 at 101 AAA 6,772,710 System Revenue Bonds, Fiscal 1996 Series B, 5.750%, 6/15/26 New York City Municipal Water Finance Authority, Water and Sewer System Revenue Bonds, Fiscal 1991 Series A: 10,200,000 7.500%, 6/15/19 (Pre-refunded to 6/15/00) 6/00 at 101 1/2 Aaa 10,578,726 5,105,000 6.000%, 6/15/20 (Pre-refunded to 6/15/00) 6/00 at 100 Aaa 5,173,458 6,395,000 6.000%, 6/15/20 (Pre-refunded to 6/15/00) 6/00 at 100 AAA 6,480,757 14,235,000 Dormitory Authority of the State of New York, City University System No Opt. Call BBB+ 15,665,333 Consolidated Second General Resolution Revenue Bonds, Series 1990D, 8.750%, 7/01/02 10,000,000 Dormitory Authority of the State of New York, City University System 7/00 at 102 Aaa 10,458,700 Consolidated Second General Resolution Revenue Bonds, Series 1990F, 7.875%, 7/01/17 (Pre-refunded to 7/01/00) 8,960,000 Dormitory Authority of the State of New York, State University 5/00 at 102 Aaa 9,298,868 Educational Facilities Revenue Bonds, Series 1989B, 7.250%, 5/15/15 (Pre-refunded to 5/15/00) 5,000,000 New York State Medical Care Facilities Finance Agency, 2/00 at 102 AAA 5,150,950 St. Luke's-Roosevelt Hospital Center, FHA-Insured Mortgage Revenue Bonds, 1989 Series B, 7.450%, 2/15/29 (Pre-refunded to 2/15/00) - ------------------------------------------------------------------------------------------------------------------------------------ North Carolina - 2.7% 2,795,000 Charlotte Mortgage Revenue Refunding Bonds (FHA-Insured 11/07 at 100 AAA 2,985,144 Mortgage-Double Oaks Apartments), 7.350%, 5/15/26 19,200,000 North Carolina Eastern Municipal Power Agency, Power System 1/07 at 102 AAA 18,699,456 Revenue Bonds, Refunding Series 1996B, 5.875%, 1/01/21 - ------------------------------------------------------------------------------------------------------------------------------------ North Dakota - 0.2% 2,000,000 City of Bismarck, North Dakota, Health Care Revenue Bonds, 7/08 at 102 AAA 1,670,180 Series 1998A (St. Alexius Medical Center), 5.000%, 7/01/28 Principal Optional Call Market Amount Description Provisions* Ratings** Value - ------------------------------------------------------------------------------------------------------------------------------------ Ohio - 1.0% $ 8,650,000 County of Cuyahoga, Ohio, Hospital Improvement Revenue Bonds, 2/09 at 101 A- $ 8,403,389 Series 1999 (The Metrohealth System Project), 6.150%, 2/15/29 - ------------------------------------------------------------------------------------------------------------------------------------ Oregon - 1.3% 8,990,000 Northern Wasco County Peoples Utility District, Wasco County, Oregon, 12/03 at 102 Aa1 8,057,467 McNary Dam Fishway Hydroelectric Project Revenue Bonds, Series 1993 (Bonneville Power Administration), 5.200%, 12/01/24 2,500,000 State of Oregon Department of General Services, Certificates of 9/00 at 102 AAA 2,622,900 Participation (1990 Real Property Financing Program), Series F, 7.500%, 9/01/15 (Pre-refunded to 9/01/00) - ------------------------------------------------------------------------------------------------------------------------------------ Pennsylvania - 1.4% 4,905,000 McKean County Hospital Authority, Hospital Revenue Bonds, 10/00 at 102 BBB- 5,205,578 Series of 1990 (Bradford Hospital Project), 8.875%, 10/01/20 6,790,000 City of Philadelphia, Pennsylvania, Water and Wastewater Revenue 6/03 at 100 AAA 6,071,414 Bonds, Series 1993, 5.000%, 6/15/16 - ------------------------------------------------------------------------------------------------------------------------------------ Rhode Island - 3.6% 4,805,000 Newport Housing Development Corporation, 1995 Multifamily 6/03 at 100 AAA 5,017,045 Mortgage Revenue Refunding Bonds (Broadway-West Broadway Apartments, FHA-Insured Mortgage, Section 8 Assisted Project), Series A, 6.800%, 8/01/24 25,000,000 Rhode Island Health and Educational Building Corporation, 5/07 at 102 AAA 23,838,250 Hospital Financing Revenue Bonds, Lifespan Obligated Group Issue, Series 1996, 5.750%, 5/15/23 - ------------------------------------------------------------------------------------------------------------------------------------ South Carolina - 0.4% 3,475,000 South Carolina State Housing Finance and Development Authority, 7/00 at 102 AA 3,572,126 Homeownership Mortgage Purchase Bonds, 1990 Series C, 7.750%, 7/01/22 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ Texas - 4.5% 2,000,000 Brazos River Authority (Texas), Collaterlized Pollution Control Revenue 2/00 at 102 BBB+ 2,051,360 Bonds (Texas Utilities Electric Company Project), Series 1990A, 8.125%, 2/01/20 (Alternative Minimum Tax) 3,500,000 Brazos River Authority (Texas), Collateralized Pollution Control 11/03 at 102 AAA 3,250,800 Revenue Refunding Bonds (Texas Utilities Electric Company Project), Series 1993A, 5.500%, 5/01/22 2,055,000 The Cameron County Housing Finance Corporation, GNMA Collateralized 9/00 at 103 AAA 2,133,727 Mortgage Revenue Refunding Bonds, 1990 Series B, 7.850%, 3/01/24 Dallas Housing Corporation, Refunding and Capital Program Revenue Bonds (Section 8 Assisted Projects), Series 1990: 1,000,000 7.700%, 8/01/05 8/00 at 102 Baa2 1,029,040 2,000,000 7.850%, 8/01/13 8/00 at 102 Baa2 2,058,000 13,175,000 Harris County Hospital District, Refunding Revenue Bonds, Texas, No Opt. Call AAA 14,993,282 Series 1990, 7.400%, 2/15/10 3,500,000 Richardson Hospital Authority (Texas), Hospital Revenue Refunding 12/08 at 101 BBB+ 2,969,785 and Improvement Bonds (Baylor/Richardson Medical Center Project), Series 1998, 5.625%, 12/01/28 8,080,000 Tyler Health Facilities Development Corporation (Texas), Hospital 2/09 at 102 AAA 7,239,518 Revenue Bonds (East Texas Medical Center Regional Healthcare System Project), Series 1997D (Remarketed), 5.375%, 11/01/27 - ------------------------------------------------------------------------------------------------------------------------------------ Virginia - 0.2% 2,000,000 City of Virginia Beach Development Authority, Multi-family Housing 10/14 at 100 N/R 1,987,260 Revenue Bonds (Residential Rental Hanptons Project), Series 1999, 7.500%, 10/01/39 - ------------------------------------------------------------------------------------------------------------------------------------ Washington - 7.2% 11,320,000 State of Washington, General Obligation Bonds, Series 1994A, 10/03 at 100 AA+ 10,090,082 4.750%, 10/01/13 3,000,000 Washington Health Care Facilities Authority, Revenue Bonds, 7/00 at 102 AAA 3,124,800 Series 1990 (Franciscan Health System/St. Francis Community Hospital of Federal Way), 7.250%, 7/01/15 (Pre-refunded to 7/01/00) 2,615,000 Washington Health Care Facilities Authority, Revenue Bonds, 12/09 at 101 AAA 2,377,663 Series 1999 (Providence Services), 5.500%, 12/01/26 Principal Optional Call Market Amount Description Provisions* Ratings** Value - ------------------------------------------------------------------------------------------------------------------------------------ Washington (continued) $ 2,000,000 Washington Public Power Supply System, Nuclear Project No. 1 7/00 at 102 AAA $ 2,092,080 Refunding Revenue Bonds, Series 1990C, 8.000%, 7/01/17 (Pre-refunded to 7/01/00) 5,650,000 Washington Public Power Supply System, Nuclear Project No. 2 7/00 at 102 Aaa 5,873,797 Refunding Revenue Bonds, Series 1990B, 7.000%, 7/01/12 (Pre-refunded to 7/01/00) 13,900,000 Washington Public Power Supply System, Nuclear Project No. 3 1/00 at 102 AAA 14,254,450 Refunding Revenue Bonds, Series 1989B, 7.250%, 7/01/15 (Pre-refunded to 1/01/00) 16,060,000 Washington Public Power Supply System, Nuclear Project No. 3 7/03 at 102 AAA 15,578,200 Refunding Revenue Bonds, Series 1993B, 5.600%, 7/01/15 4,500,000 Washington Public Power Supply System, Nuclear Project No. 3 7/03 at 102 Aa1 4,184,050 Refunding Revenue Bonds, Series 1993C, 5.375%, 7/01/15 - ------------------------------------------------------------------------------------------------------------------------------------ $ 793,880,000 Total Investments - (cost $792,353,145) - 99.0% 794,366,976 ============= Other Assets Less Liabilities - 1.0% 8,141,502 -------------------------------------------------------------------------------------------------------------------- Net Assets - 100% $802,508,478 ==================================================================================================================== * Optional Call Provisions (not covered by the report of independent auditors): Dates (month and year) and prices of the earliest optional call or redemption. There may be other call provisions at varying prices at later dates. ** Ratings (not covered by the report of independent auditors): Using the higher of Standard & Poor's or Moody's rating. *** Securities are backed by an escrow or trust containing sufficient U.S. government or U.S. government agency securities which ensures the timely payment of principal and interest. Securities are normally considered to be equivalent to AAA rated securities. N/R Investment is not rated. See accompanying notes to financial statements.
Portfolio of Investments NUVEEN SELECT QUALITY MUNICIPAL FUND, INC. (NQS) October 31,1999
Principal Optional Call Market Amount Description Provisions* Ratings** Value - ------------------------------------------------------------------------------------------------------------------------------------ Alabama - 2.3% $ 2,900,000 The Water Works Board of the City of Arab (Alabama), Water Revenue 8/01 at 102 AAA $ 3,073,101 Bonds, Series 1991, 7.050%, 8/01/16 2,625,000 Jefferson County, Alabama, Sewer Revenue Refunding Warrants, 2/07 at 100 AAA 2,381,452 Series 1997-A, 5.375%, 2/01/27 Jefferson County, Alabama, Sewer Revenue Capital Improvement Warrants, Series 1999-A: 8,000,000 5.375%, 2/01/36 2/09 at 101 AAA 7,134,800 5,000,000 5.750%, 2/01/38 2/09 at 101 AAA 4,759,100 - ------------------------------------------------------------------------------------------------------------------------------------ Alaska - 1.1% 9,450,000 Alaska Energy Authority, Power Revenue Refunding Bonds, Third Series 7/09 at 101 AAA 8,122,275 (Bradley Hydroelectric Project), 5.000%, 7/01/21 - ------------------------------------------------------------------------------------------------------------------------------------ Arkansas - 1.1% 2,740,000 Arkansas Development Finance Authority, Single Family Mortgage 8/01 at 103 AA 2,822,748 Revenue Refunding Bonds, 1991 Series A (FHA-Insured or VA Guaranteed Mortgage Loans), 8.000%, 8/15/11 4,500,000 City of Little Rock, Arkansas, Hotel and Restaurant Gross Receipts No Opt. Call A 5,185,935 Tax Refunding Bonds, Series 1993, 7.375%, 8/01/15 - ------------------------------------------------------------------------------------------------------------------------------------ California - 1.3% 4,000,000 California Health Facilities Financing Authority, Kaiser Permanente 10/08 at 102 A 3,393,680 Revenue Bonds, Series 1998B, 5.000%, 10/01/20 3,125,000 State of California Department of Transportation, Refunding 3/07 at 102 AAA 2,955,875 Certificates of Participation, Series 1997A, 5.250%, 3/01/16 3,785,000 Department of Water and Power of the City of Los Angeles 9/03 at 102 Aa3 3,493,479 (California), Electric Plant Refunding Revenue Bonds, Issue of 1993, 5.375%, 9/01/23 - ------------------------------------------------------------------------------------------------------------------------------------ Colorado - 6.5% 9,250,000 Colorado Health Facilities Authority, Revenue Bonds, 1994 Series A 7/06 at 102 A 8,336,378 (Kaiser Permanente), Remarketed, 5.350%, 11/01/16 City and County of Denver, Colorado, Airport System Revenue Bonds, Series 1992C: 2,560,000 6.750%, 11/15/22 (Alternative Minimum Tax) (Pre-refunded to 11/15/02) 11/02 at 102 Aaa 2,772,531 9,590,000 6.750%, 11/15/22 (Alternative Minimum Tax) 11/02 at 102 BBB+ 9,678,995 City and County of Denver, Colorado, Airport System Revenue Bonds, Series 1991A: 5,305,000 8.750%, 11/15/23 (Alternative Minimum Tax) (Pre-refunded to 11/15/01) 11/01 at 102 Aaa 5,863,617 14,695,000 8.750%, 11/15/23 (Alternative Minimum Tax) 11/01 at 102 BBB+ 15,931,878 City and County of Denver, Colorado, Airport System Revenue Bonds, Series 1991D: 1,040,000 7.750%, 11/15/21 (Alternative Minimum Tax) (Pre-refunded to 11/15/01) 11/01 at 102 Aaa 1,129,721 3,960,000 7.750%, 11/15/21 (Alternative Minimum Tax) 11/01 at 102 BBB+ 4,217,558 990,000 Jefferson County, Colorado, Single Family Revenue Refunding Bonds, 4/01 at 103 AAA 1,033,511 Series 1991A, 8.875%, 10/01/13 - ------------------------------------------------------------------------------------------------------------------------------------ Connecticut - 2.4% 7,245,000 Connecticut Development Authority, Health Facility Refunding 8/01 at 103 N/R*** 8,131,716 Revenue Bonds, Alzheimer's Resource Center of Connecticut, Inc. Project, Series 1991A, 10.000%, 8/15/21 (Pre-refunded to 8/15/01) 9,785,000 Connecticut Development Authority, Health Facility Refunding Revenue 8/04 at 102 N/R 10,067,102 Bonds, Alzheimer's Resource Center of Connecticut, Inc. Project, Series 1994A, 7.250%, 8/15/21 - ------------------------------------------------------------------------------------------------------------------------------------ District of Columbia - 1.4% 10,265,000 District of Columbia (Washington, D.C.), General Obligation Bonds, 6/08 at 101 AAA 9,019,856 Series 1998B, 5.250%, 6/01/26 1,610,000 District of Columbia Housing Finance Agency, Collateralized Single 12/00 at 102 AAA 1,674,191 Family Mortgage Revenue Bonds, Series 1990A, 8.100%, 12/01/23 (Alternative Minimum Tax) Principal Optional Call Market Amount Description Provisions* Ratings** Value - ------------------------------------------------------------------------------------------------------------------------------------ Florida - 1.3% $ 9,250,000 Jacksonville Electric Authority (Jacksonville, Florida), Bulk Power Supply 10/00 at 101 1/2 Aaa $ 9,626,938 System Revenue Bonds (Scherer 4 Project), Issue One, Series 1991A, 6.750%, 10/01/21 (Pre-refunded to 10/01/00) - ------------------------------------------------------------------------------------------------------------------------------------ Hawaii - 2.3% 16,000,000 Department of Budget and Finance of the State of Hawaii, Special 7/01 at 102 AAA 17,172,800 Purpose Revenue Bonds, Kapiolani Health Care System Obligated Group (Pali Momi Medical Center Project), Series 1991, 7.650%, 7/01/19 (Pre-refunded to 7/01/01) - ------------------------------------------------------------------------------------------------------------------------------------ Illinois - 7.8% 5,000,000 City of Chicago (Illinois), General Obligation Bonds, Project and Refunding 1/06 at 102 AAA 4,328,150 Series 1995B, 5.125%, 1/01/25 7,375,000 City of Chicago (Illinois), Lakefront Millennium Project, Parking No Opt. Call AAA 7,203,679 Facilities Bonds (Limited Tax), Series 1998, 5.750%, 1/01/23 Chicago School Reform Board of Trustees of the Board of Education of the City of Chicago, Illinois, Unlimited Tax General Obligation Bonds (Dedicated Tax Revenues), Series 1997: 4,000,000 5.750%, 12/01/20 12/07 at 102 AAA 3,855,520 5,000,000 5.750%, 12/01/27 12/07 at 102 AAA 4,769,050 30,000,000 Chicago School Reform Board of Trustees of the Board of Education No Opt. Call AAA 5,962,500 of the City of Chicago, Illinois, Unlimited Tax General Obligation Bonds (Dedicated Tax Revenues), Series 1998A, 0.000%, 12/01/25 5,000,000 City of Chicago, Chicago O'Hare International Airport Special 9/09 at 101 Baa2 4,383,700 Facilities Revenue Refunding Bonds (United Air Lines, Inc. Project), Series 1999A, 5.350%, 9/01/16 Illinois Development Finance Authority, Multifamily Housing Bonds (Affordable Housing Preservation Foundation Project), Series 1990, Subseries A (FHA-Insured Mortgage Loans - Lawless Gardens Project): 775,000 7.650%, 7/01/07 1/02 at 105 AAA 833,668 6,780,000 7.650%, 12/31/31 1/02 at 105 AAA 7,272,974 1,585,000 Illinois Housing Development Authority, Multifamily Housing Bonds, 7/01 at 102 A+ 1,657,324 1991 Series C, 7.400%, 7/01/23 The County of St. Clair, Illinois, General Obligation Bonds (Alternate Revenue Source), Series 1999: 3,240,000 5.625%, 10/01/12 10/09 at 102 AAA 3,267,864 4,410,000 5.625%, 10/01/13 10/09 at 102 AAA 4,409,780 5,285,000 5.500%, 10/01/14 10/09 at 102 AAA 5,161,331 5,930,000 5.500%, 10/01/15 10/09 at 102 AAA 5,725,474 - ------------------------------------------------------------------------------------------------------------------------------------ Indiana - 1.9% 8,640,000 Avon Community School Building Corporation (Hendricks County, 7/04 at 101 AAA 8,191,670 Indiana), First Mortgage Bonds, Series 1994, 5.500%, 1/01/16 5,055,000 Beacon Heights Housing Development Corporation, 1991 Multifamily 6/01 at 100 AAA 5,175,006 Mortgage Revenue Refunding Bonds (FHA-Insured Mortgage-Section 8 Assisted Project), Series A, 7.625%, 2/01/21 1,070,000 Michigan City Housing Development Corporation, 1991 Multifamily 6/01 at 100 AAA 1,090,705 Mortgage Revenue Refunding Bonds (FHA-Insured Mortgage-Section 8 Assisted Project), Series A, 7.625%, 2/01/21 - ------------------------------------------------------------------------------------------------------------------------------------ Kansas - 2.2% 7,025,000 City of Merriam, Kansas, Hospital Refunding Revenue Bonds, 9/01 at 102 AAA 7,366,696 Series 1991C (Shawnee Mission Medical Center, Inc. Project), 7.250%, 9/01/04 (Pre-refunded to 9/01/01) 8,800,000 City of Merriam, Kansas, Hospital Refunding Revenue Bonds, 9/01 at 102 AAA 9,407,376 Series 1991B (Shawnee Mission Medical Center, Inc. Project), 7.250%, 9/01/21 (Pre-refunded to 9/01/01) - ------------------------------------------------------------------------------------------------------------------------------------ Kentucky - 0.4% 3,015,000 Lakeland Wesley Village, Inc., Mortgage Revenue Refunding Bonds 11/01 at 103 Aa 3,101,892 (Lakeland Wesley Village I Elderly-Section 8 Assisted Project/FHA-Insured Mortgage), Series 1991, 7.500%, 11/01/21 - ------------------------------------------------------------------------------------------------------------------------------------ Louisiana - 0.2% 1,125,000 Calcasieu Parish Public Trust Authority (Louisiana), Mortgage Revenue 6/01 at 103 A1 1,169,561 Refunding Bonds, 1991 Series A, 7.750%, 6/01/12 Principal Optional Call Market Amount Description Provisions* Ratings** Value - ------------------------------------------------------------------------------------------------------------------------------------ Maryland - 1.0% - ------------------------------------------------------------------------------------------------------------------------------------ $ 7,500,000 Maryland Health and Higher Educational Facilities Authority, Revenue 7/09 at 101 AA $ 7,300,500 Bonds, the Johns Hopkins University Issue, Series 1999, 6.000%, 7/01/39 (WI) - ------------------------------------------------------------------------------------------------------------------------------------ Massachusetts - 4.5% 7,375,000 Boston Housing Development Corporation, Mortgage Revenue Refunding 1/04 at 102 AAA 6,840,165 Bonds, Series 1994A (FHA-Insured Mortgage Loans - Section 8 Assisted Projects), 5.500%, 7/01/24 5,000,000 Massachusetts Bay Transportation Authority, General Transportation 3/07 at 101 AA- 4,235,550 System Bonds, 1998 Series B, 5.000%, 3/01/28 2,000,000 Massachusetts Health and Educational Facilities Authority, Revenue 6/01 at 102 A3*** 2,159,360 Bonds, Lowell General Hospital Issue, Series A, 8.400%, 6/01/11 (Pre-refunded to 6/01/01) 14,025,000 Massachusetts Water Resources Authority, General Revenue Bonds, 4/00 at 100 AAA 14,151,926 1990 Series A, 6.000%, 4/01/20 (Pre-refunded to 4/01/00) 6,300,000 Somerville Housing Authority (Massachusetts), Mortgage Revenue 5/00 at 102 AAA 6,477,093 Bonds, Series 1990 (GNMA Collateralized - Clarendon Hill Towers Project), 7.950%, 11/20/30 - ------------------------------------------------------------------------------------------------------------------------------------ Michigan - 2.5% 3,625,000 Fowlerville Community Schools, Counties of Livingston, Ingham, and 5/07 at 100 AAA 3,779,280 Shiawassee, State of Michigan, 1996 School Building and Site Bonds, 5.600%, 5/01/26 (Pre-refunded to 5/01/07) 7,890,000 Michigan State Hospital Finance Authority, Hospital Revenue Bonds 8/01 at 102 Aaa 8,477,726 (The Detroit Medical Center Obligated Group), Series 1991A, 7.500%, 8/15/11 (Pre-refunded to 8/15/01) 6,525,000 Michigan State Hospital Finance Authority Revenue Bonds 11/00 at 100 AAA 6,352,218 (Ascension Health Credit Group), Series 1999A, 5.750%, 11/15/16 - ------------------------------------------------------------------------------------------------------------------------------------ Minnesota - 0.7% 3,465,000 Chisago County, Southcentral Minnesota Multi-County and 3/04 at 102 27/32 AAA 3,649,026 Stearns County Housing and Redevelopment Authorities, Single Family Mortgage Revenue Refunding Bonds (Fannie Mae Mortgage-Backed Securities Program), Series 1994B, 7.050%, 9/01/27 (Alternative Minimum Tax) The Dakota, Washington, and Stearns Counties Housing and Redevelopment Authority, Single Family Mortgage Revenue Refunding Bonds (Fannie Mae Mortgage-Backed Securities Program), Series 1994A: 965,000 6.600%, 9/01/17 (Alternative Minimum Tax) 3/04 at 102 AAA 986,906 705,000 6.700%, 3/01/21 (Alternative Minimum Tax) 3/04 at 102 AAA 721,687 - ------------------------------------------------------------------------------------------------------------------------------------ Mississippi - 0.2% 1,410,000 Goodman Housing Development Corporation, 1991 Multifamily 8/01 at 100 AAA 1,437,805 Mortgage Revenue Refunding Bonds, Goodhaven Manor (FHA-Insured Mortgage, Section 8 Assisted Project), Series A, 7.625%, 2/01/22 - ------------------------------------------------------------------------------------------------------------------------------------ Nebraska - 1.4% 10,550,000 Nebraska Investment Finance Authority, Single Family Housing 3/05 at 101 1/2 AAA 10,886,229 Revenue Bonds, 1995 Series A, 6.800%, 3/01/35 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ Nevada - 2.4% 7,500,000 Clark County, Nevada, Airport System Subordinate Lien Revenue 7/10 at 101 AAA 7,422,300 Bonds, Series 1999A, 6.000%, 7/01/29 (WI) 10,000,000 Clark County School District, Nevada, General Obligation (Limited Tax), 6/06 at 101 AAA 10,702,700 School Improvement Bonds, Series 1996, 6.000%, 6/15/15 - ------------------------------------------------------------------------------------------------------------------------------------ New Jersey - 1.2% 4,420,000 New Jersey Housing and Mortgage Finance Agency, Section 8 Bonds, 11/01 at 102 AA+ 4,612,845 1991 Series A, 6.850%, 11/01/06 5,000,000 The Pollution Control Financing Authority of Salem County 11/03 at 102 AAA 4,743,750 (New Jersey), Pollution Control Revenue Refunding Bonds, 1993 Series C (Public Service Electric and Gas Company Project), 5.550%, 11/01/33 - ------------------------------------------------------------------------------------------------------------------------------------ New Mexico - 1.2% 10,000,000 City of Farmington, New Mexico, Pollution Control Refunding 4/09 at 102 AAA 8,705,800 Revenue Bonds (Southern California Edison Company, Four Corners Project), 1999 Series A, 5.125%, 4/01/29 Principal Optional Call Market Amount Description Provisions* Ratings** Value - ------------------------------------------------------------------------------------------------------------------------------------ New York - 11.7% The City of New York, General Obligation Bonds, Fiscal 1991 Series F, Tax-Exempt Bonds: $ 5,000,000 8.250%, 11/15/10 (Pre-refunded to 11/15/01) 11/01 at 101 1/2 AAA $ 5,461,800 7,750,000 8.250%, 11/15/15 (Pre-refunded to 11/15/01) 11/01 at 101 1/2 8,465,790 3,520,000 The City of New York, General Obligation Bonds, Fiscal 1998 Series F, 2/08 at 101 A- 3,284,794 5.250%, 8/01/14 The City of New York, General Obligation Bonds, Fiscal 1997 Series G: 90,000 6.000%, 10/15/26 (Pre-refunded to 10/15/07) 10/07 at 101 A-*** 96,733 9,200,000 6.000%, 10/15/26 10/07 at 101 A- 9,120,788 6,240,000 The City of New York, General Obligation Bonds, Fiscal 1999 Series H, 3/09 at 101 A- 5,704,109 5.250%, 3/15/16 5,000,000 New York City Health and Hospitals Corporation, Health System Bonds, 2/09 at 101 AAA 4,345,900 1999 Series A, 5.000%, 2/15/20 6,000,000 New York City Municipal Water Finance Authority, Water and 6/09 at 101 AAA 5,526,540 Sewer System Revenue Bonds, Fiscal 2000 Series A, 5.500%, 6/15/32 5,000,000 Dormitory Authority of the State of New York, Mental Health Services 8/08 at 101 AAA 4,306,450 Facilities Improvement Revenue Bonds, Series 1998D, 5.000%, 2/15/23 6,000,000 New York Local Government Assistance Corporation (A Public Benefit 4/02 at 102 AAA 6,464,580 Corporation of the State of New York), Series 1991D, 7.000%, 4/01/18 (Pre-refunded to 4/01/02) New York State Medical Care Facilities Finance Agency, Mental Health Services Facilities Improvement Revenue Bonds, 1991 Series B: 1,020,000 7.600%, 2/15/06 (Pre-refunded to 8/15/01) 8/01 at 102 A-*** 1,097,163 1,010,000 7.600%, 8/15/06 (Pre-refunded to 8/15/01) 8/01 at 102 A-*** 1,086,407 5,970,000 7.625%, 8/15/17 (Pre-refunded to 8/15/01) 8/01 at 102 A-*** 6,424,198 New York State Medical Care Facilities Finance Agency, Mental Health Services Facilities Improvement Revenue Bonds, 1991 Series D: 5,380,000 7.400%, 2/15/18 (Pre-refunded to 2/15/02) 2/02 at 102 A-*** 5,821,752 40,000 7.400%, 2/15/18 2/02 at 102- A- 42,771 New York State Medical Care Facilities Finance Agency, Mental Health Services Facilities Improvement Revenue Bonds, 1991 Series B: 595,000 7.600%, 2/15/06 8/01 at 102 A- 635,353 580,000 7.600%, 8/15/06 8/01 at 102 A- 619,336 1,980,000 7.625%, 8/15/17 8/01 at 102 A- 2,110,324 12,940,000 New York State Urban Development Corporation, 1996 Corporate 7/06 at 102 AAA 11,978,299 Purpose Senior Lien Bonds, 5.500%, 7/01/26 6,000,000 New York State Urban Development Corporation, Correctional 1/01 at 102 Aaa 6,340,440 Capital Facilities Revenue Bonds, Series 2, 7.500%, 1/01/18 (Pre-refunded to 1/01/01) - ------------------------------------------------------------------------------------------------------------------------------------ North Carolina - 2.3% 18,555,000 North Carolina Eastern Municipal Power Agency, Power System 1/03 at 100 AAA 17,463,224 Revenue Bonds, Refunding Series 1993 B, 5.500%, 1/01/17 - ------------------------------------------------------------------------------------------------------------------------------------ North Dakota - 1.3% 10,000,000 City of Grand Forks, North Dakota, Sales Tax Revenue Bonds 12/07 at 100 AAA 9,459,600 (The Aurora Project), Series 1997A, 5.625%, 12/15/29 - ------------------------------------------------------------------------------------------------------------------------------------ Ohio - 0.8% 5,000,000 Akron, Bath and Copley Joint Township Hospital District, Ohio, 11/09 at 101 Baa1 4,321,800 Hospital Facilities Revenue Bonds, Series 1998A (Summa Health System Project), 5.375%, 11/15/18 1,160,000 Toledo-Lucas County Port Authority, Development Revenue Bonds 11/00 at 102 N/R 1,188,664 (Northwest Ohio Bond Fund), Series 1989C, 8.400%, 11/15/09 (Alternative Minimum Tax) 805,000 Toledo-Lucas County Port Authority, Development Revenue Bonds 11/99 at 100 N/R 806,827 (Northwest Ohio Bond Fund), Series 1989D, 8.500%, 11/15/00 (Alternative Minimum Tax) 85,000 Toledo-Lucas County Port Authority, Development Revenue Bonds No Opt. Call N/R*** 86,100 (Northwest Ohio Bond Fund), Series 1990D, 8.500%, 5/15/00 (Alternative Minimum Tax) Principal Optional Call Market Amount Description Provisions* Ratings** Value - ------------------------------------------------------------------------------------------------------------------------------------ Oklahoma - 3.7% $ 5,965,000 Oklahoma County Home Finance Authority (Oklahoma County, Oklahoma), 7/01 at 102 Aaa $ 6,190,298 Single Family Mortgage Revenue Refunding Bonds, 1991 Series A, 8.750%, 7/01/12 21,025,000 Trustees of the Tulsa Municipal Airport Trust, Revenue Bonds, 6/01 at 102 Baa2 22,026,211 Series 1991, 7.600%, 12/01/30 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ Rhode Island - 0.8% 7,500,000 Rhode Island Health and Educational Building Corporation, Higher 4/09 at 101 AAA 6,293,250 Education Facility Revenue Bonds, Johnson and Wales University Issue, Series 1999, 5.000%, 4/01/29 - ------------------------------------------------------------------------------------------------------------------------------------ South Carolina - 1.6% 4,000,000 Charleston County, South Carolina, Revenue Bonds, Series 1999A 8/09 at 101 AAA 3,338,840 (CareAlliance Health Services), 5.000%, 8/15/28 5,000,000 Oconee County, South Carolina, Pollution Control Facilities Revenue 4/03 at 102 Aa2 4,987,650 Refunding Bonds, Series 1993, (Duke Power Company Project), 5.800%, 4/01/14 5,000,000 Piedmont Municipal Power Agency (South Carolina), Electric Revenue 1/09 at 101 BBB- 4,100,200 Bonds, 1999A Refunding Series, 5.250%, 1/01/21 - ------------------------------------------------------------------------------------------------------------------------------------ South Dakota - 1.9% 7,315,000 City of Sioux Falls, South Dakota, Industrial Revenue Refunding Bonds, 10/14 at 100 AAA 9,000,888 Series 1989 (Great Plains Hotel Corporation Project), 8.500%, 11/01/16 (Alternative Minimum Tax) (Pre-refunded to 10/15/14) 4,970,000 South Dakota Housing Development Authority, Homeownership 11/06 at 102 AAA 5,027,801 Mortgage Bonds, 1996 Series D, 6.300%, 5/01/27 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ Tennessee - 2.0% 7,220,000 The Metropolitan Government of Nashville and Davidson County 5/02 at 102 AAA 7,656,377 (Tennessee), General Obligation Multi-Purpose Improvement Bonds, Series 1994, 6.150%, 5/15/25 (Pre-refunded to 5/15/02) 7,500,000 The Health and Educational Facilities Board of the Metropolitan 11/09 at 101 AAA 7,301,250 Government of Nashville and Davidson County, Tennessee, Revenue Bonds (Ascension Health Credit Group), Series 1999A, 5.875%, 11/15/28 - ------------------------------------------------------------------------------------------------------------------------------------ Texas - 9.3% 8,580,000 Brazos River Authority (Texas), Collaterlized Pollution Control Revenue 2/00 at 102 BBB+ 8,800,334 Bonds (Texas Utilities Electric Company Project), Series 1990A, 8.125%, 2/01/20 (Alternative Minimum Tax) 6,000,000 Brazos River Authority (Texas), Revenue Refunding Bonds (Houston 11/08 at 102 AAA 5,232,900 Industries Incorporated Project), Series 1998C, 5.125%, 11/01/20 (Optional put 11/01/08) 3,430,000 Comal County Health Facilities Development Corporation, Hospital 1/01 at 102 AAA 3,562,638 Revenue Refunding Bonds (McKenna Memorial Hospital FHA-Insured Project), Series 1991, 7.375%, 1/15/21 5,000,000 Dallas-Fort Worth International Airport Facility Improvement 11/02 at 102 Baa2 5,268,800 Corporation, American Airlines, Inc. Revenue Bonds, Series 1992, 7.250%, 11/01/30 (Alternative Minimum Tax) 7,515,000 El Paso Housing Finance Corporation, Single Family Mortgage Revenue 4/01 at 103 A2 7,966,426 Refunding Bonds, Series 1991A, 8.750%, 10/01/11 1,940,000 The Harrison County Finance Corporation, Single Family Mortgage 12/01 at 103 A1 2,004,447 Revenue Refunding Bonds, Series 1991, 8.875%, 12/01/11 4,500,000 City of Houston, Texas, Airport System Subordinate Lien Revenue Bonds, 7/08 at 100 AAA 3,757,455 Series 1998B, 5.000%, 7/01/25 (Alternative Minimum Tax) 9,000,000 Matagorda County Navigation District Number One (Texas), No Opt. Call AAA 7,721,100 Collateralized Revenue Refunding Bonds (Houston Lighting and Power Company Project), Series 1997, 5.125%, 11/01/28 (Alternative Minimum Tax) 7,500,000 Matagorda County Navigation District Number One (Texas), Revenue 5/09 at 101 BBB+ 6,988,275 Refunding Bonds (Reliant Energy, Incorporated Project), Series 1999B, 5.950%, 5/01/30 2,395,000 Panhandle Regional Housing Finance Corporation, Single Family 5/01 at 100 AAA 2,428,817 Mortgage Revenue Bonds (GNMA Mortgage-Backed Securities Program), Series 1991A, 7.500%, 5/01/24 (Alternative Minimum Tax) 8,000,000 Red River Authority of Texas, Pollution Control Revenue Refunding 7/05 at 102 AAA 7,744,480 Bonds, Fixed Rate Conversion of Tender Securities (Southwestern Public Service Company Project), Series 1991, 5.200%, 7/01/11 Principal Optional Call Market Amount Description Provisions* Ratings** Value - ------------------------------------------------------------------------------------------------------------------------------------ Texas (continued) $ 4,520,000 State of Texas, General Obligation Bonds, Water Financial Assistance 8/09 at 100 Aa1 $ 4,142,083 Bonds, Series 1999C (State Participation Program), 5.500%, 8/01/35 4,560,000 Winter Garden Housing Finance Corporation, Single Family Mortgage 4/04 at 103 AAA 4,727,808 Revenue Bonds (GNMA and FNMA Mortgage-Backed Securities Program), Series 1994, 6.950%, 10/01/27 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ Utah - 3.6% 13,650,000 Intermountain Power Agency, Power Supply Revenue Refunding Bonds, 7/03 at 102 AAA 12,716,477 1993 Series A, 5.500%, 7/01/20 16,550,000 Utah County, Utah, Hospital Revenue Bonds, Series 1997 (IHC Health 8/07 at 101 AAA 14,477,113 Services, Inc.), 5.250%, 8/15/26 - ------------------------------------------------------------------------------------------------------------------------------------ Washington - 10.5% 7,225,000 Port of Seattle (Washington), Special Facility Revenue Bonds 3/10 at 101 AAA 7,110,412 (Terminal 18 Project), Series 1999C, 6.000%, 9/01/20 (Alternative Minimum Tax) Municipality of Metropolitan Seattle, Washington, Sewer Refunding Revenue Bonds, Series Z: 2,160,000 5.450%, 1/01/16 1/03 at 102 AAA 2,059,603 3,095,000 5.450%, 1/01/17 1/03 at 102 AAA 2,931,894 2,490,000 5.450%, 1/01/19 1/03 at 102 AAA 2,320,257 1,800,000 5.450%, 1/01/20 1/03 at 102 AAA 1,670,418 4,000,000 Washington Public Power Supply System, Nuclear Project No. 1 1/00 at 102 AAA 4,103,040 Refunding Revenue Bonds, Series 1989B, 7.400%, 7/01/09 (Pre-refunded to 1/01/00) 10,000,000 Washington Public Power Supply System, Nuclear Project No. 1 7/07 at 102 AAA 9,052,800 Refunding Revenue Bonds, Series 1997A, 5.125%, 7/01/16 Washington Public Power Supply System, Nuclear Project No. 2 Refunding Revenue Bonds, Series 1992A: 7,880,000 6.250%, 7/01/12 (Pre-refunded to 7/01/02) 7/02 at 102 Aaa 8,376,282 2,130,000 6.250%, 7/01/12 7/02 at 102 Aa1 2,221,078 2,000,000 Washington Public Power Supply System, Nuclear Project No. 2 7/00 at 102 AAA 2,084,000 Refunding Revenue Bonds, Series 1990A, 7.375%, 7/01/12 (Pre-refunded to 7/01/00) 5,000,000 Washington Public Power Supply System, Nuclear Project No. 2 7/00 at 102 Aaa 5,198,050 Refunding Revenue Bonds, Series 1990B, 7.000%, 7/01/12 (Pre-refunded to 7/01/00) 5,000,000 Washington Public Power Supply System, Nuclear Project No. 2 7/04 at 102 Aa1 4,902,050 Refunding Revenue Bonds, Series 1994A, 5.375%, 7/01/11 24,060,000 Washington Public Power Supply System, Nuclear Project No. 3 1/00 at 102 AAA 24,673,530 Refunding Revenue Bonds, Series 1989B, 7.250%, 7/01/15 (Pre-refunded to 1/01/00) 2,935,000 Washington Public Power Supply System, Nuclear Project No. 3 7/03 at 102 Aa1 2,728,930 Refunding Revenue Bonds, Series 1993C, 5.375%, 7/01/15 - ------------------------------------------------------------------------------------------------------------------------------------ Wisconsin - 1.6% 11,080,000 Wisconsin Center District, Junior Dedicated Tax Revenue Bonds, 12/06 at 101 AAA 11,742,580 Series 1996B, 5.750%, 12/15/27 (Pre-refunded to 12/15/06) - ------------------------------------------------------------------------------------------------------------------------------------ $ 775,445,000 Total Investments - (cost $739,968,643) - 98.4% 742,852,607 ============= Short-Term Investments - 3.5% 5,600,000 California Pollution Control Financing Authority, Pollution A-1+ 5,600,000 Control Refunding Revenue Bonds (Pacific Gas and Electric Company), 1996 Series C, Variable Rate Demand Bonds, 3.500%, 11/01/26+ 2,200,000 California Statewide Communities Development Authority, Certificates VMIG-1 2,200,000 of Participation Revenue Bonds (Sutter Health Obligation Group), Variable Rate Demand Bonds, Series 1995, 3.500%, 7/01/15+ 6,500,000 Delaware Economic Development Authority (Delmarva Power and VMIG-1 6,500,000 Light Company),Variable Rate Demand Bonds, 3.700%, 10/01/17 (Alternative Minimum Tax)+ 4,100,000 Residential Care Facility for the Elderly Authority of Fulton County A-1+ 4,100,000 (Georgia), Variable Rate Demand Refunding Revenue Bonds (Lenbrook Square Foundation, Inc. Project), Series 1996, 3.500%, 1/01/18+ 3,000,000 Health and Educational Facilities Authority of the State of Missouri, A-1+ 3,000,000 Variable Rate Demand Bonds, Health Facilities Revenue Bonds (St. Francis' Medical Center), Series 1996A, 3.500%, 6/01/26+ Principal Optional Call Market Amount Description Provisions* Ratings** Value - ------------------------------------------------------------------------------------------------------------------------------------ Short-Term Investments (continued) $ 3,400,000 Moffat County Pollution Control Revenue Bonds (Pacificorp Projects), VMIG-1 $ 3,400,000 AMBAC Variable Rate Demand Bonds, 3.500%, 5/01/13+ 1,600,000 City of Valdez, Alaska, Marine Terminal Revenue Refunding Bonds VMIG-1 1,600,000 (Exxon Pipeline Company Project), 1993 Series A, Variable Rate Demand Bonds, 3.500%, 12/01/33+ - ------------------------------------------------------------------------------------------------------------------------------------ $ 26,400,000 Total Short-Term Investments - (cost $26,400,000) 26,400,000 ============= Other Assets Less Liabilities - (1.9)% (14,150,519) -------------------------------------------------------------------------------------------------------------------- Net Assets - 100% $755,102,088 ==================================================================================================================== * Optional Call Provisions (not covered by the report of independent auditors): Dates (month and year) and prices of the earliest optional call or redemption. There may be other call provisions at varying prices at later dates. ** Ratings (not covered by the report of independent auditors): Using the higher of Standard & Poor's or Moody's rating. *** Securities are backed by an escrow or trust containing sufficient U.S. government or U.S. government agency securities which ensures the timely payment of principal and interest. Securities are normally considered to be equivalent to AAA rated securities. N/R Investment is not rated. (DD) Security purchased on a delayed delivery basis (note 1). (WI) Security purchased on a when-issued basis (note 1). + Security has a maturity of more than one year, but has variable rate and demand features which qualify it as a short-term security. The rate disclosed is that currently in effect. This rate changes periodically based on market conditions or a specified market index. See accompanying notes to financial statements.
Portfolio of Investments NUVEEN QUALITY INCOME MUNICIPAL FUND, INC. (NQU) October 31,1999
Principal Optional Call Market Amount Description Provisions* Ratings** Value - ------------------------------------------------------------------------------------------------------------------------------------ Alabama - 2.6% $ 5,180,000 Alabama Drinking Water Finance Authority, Revolving Fund Loan Bonds, 9/08 at 100 AAA $ 4,362,648 Series 1998A, 4.850%, 8/15/22 6,500,000 The Governmental Utility Services Corporation of the City of Bessemer 6/08 at 102 AAA 5,764,720 (Alabama), Water Supply Revenue Bonds, Series 1998, 5.200%, 6/01/24 17,000,000 The Industrial Development Board of the Town of Courtland, Pollution 6/05 at 102 Baa1 16,263,390 Control Refunding Revenue Bonds (Champion International Corporation Project), Series 1995, 6.150%, 6/01/19 6,480,000 The Industrial Development Board of the Town of Courtland, Solid 10/08 at 102 Baa1 5,659,956 Waste Disposal Revenue Bonds, (Champion International Corporation Project), Refunding Series 1998A, 5.700%, 10/01/28 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ Alaska - 1.7% 6,750,000 Alaska State Housing Finance Corporation, General Housing Purpose 12/02 at 102 Aa2*** 7,274,880 Bonds, 1992 Series A, 6.600%, 12/01/23 (Pre-refunded to 12/01/02) 14,590,000 Alaska State Housing Finance Corporation, Governmental Purpose Bonds, 12/05 at 102 AAA 14,035,872 1995 Series A, 5.875%, 12/01/30 - ------------------------------------------------------------------------------------------------------------------------------------ Arizona - 0.5% 5,245,000 Yuma Regional Medical Center on Behalf of Hospital District No. 1 8/02 at 101 1/2 N/R*** 5,795,620 of Yuma County, Arizona, Hospital Revenue Improvement and Refunding Bonds (Yuma Regional Medical Center Project), Series 1992, 8.000%, 8/01/17 (Pre-refunded to 8/01/02) - ------------------------------------------------------------------------------------------------------------------------------------ Arkansas - 0.7% 2,465,000 Arkansas Development Finance Authority, Single Family Mortgage 8/01 at 103 AA 2,539,443 Revenue Refunding Bonds, 1991 Series A (FHA-Insured or VA Guaranteed Mortgage Loans), 8.000%, 8/15/11 5,990,000 Arkansas Development Finance Authority, Single Family Mortgage 7/05 at 102 AAA 6,192,103 Revenue Bonds, 1995 Series B (Mortgage-Backed Securities Program), 6.700%, 7/01/27 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ California - 10.8% Brea Public Financing Authority (Orange County, California), 1991 Tax Allocation Revenue Bonds, Series A (Redevelopment Project AB): 10,580,000 7.000%, 8/01/15 (Pre-refunded to 8/01/01) 8/01 at 102 AAA 11,323,457 4,420,000 7.000%, 8/01/15 8/01 at 102 AAA 4,684,802 3,005,000 California Housing Finance Agency, Home Mortgage Revenue Bonds, 8/01 at 102 Aa2 3,092,055 1991 Series G, 7.050%, 8/01/27 (Alternative Minimum Tax) 5,860,000 California Housing Finance Agency, Multifamily Housing Revenue 8/08 at 101 1/2 AAA 5,309,277 Bonds III, 1998 Series A, 5.450%, 8/01/28 (Alternative Minimum Tax) 3,000,000 California Health Facilities Financing Authority, Kaiser Permanente 5/03 at 102 A 2,698,800 Revenue Bonds, 1993 Series C, 5.600%, 5/01/33 13,750,000 State of California, General Obligation Bonds, 4.500%, 12/01/18 12/08 at 101 AA- 11,348,975 10,250,000 State of California, General Obligation Refunding Bonds, 5.000%, 2/01/21 2/08 at 101 AA- 8,987,918 20,000,000 State of California, Various Purpose General Obligation Bonds, 4.750%, 4/01/29 4/09 at 101 AA- 16,316,600 5,000,000 State of California, Veterans General Obligation Bonds, Series BH, 12/03 at 102 AA- 4,602,250 5.600%, 12/01/32 (Alternative Minimum Tax) 5,750,000 State of California, Veterans General Obligation Bonds, Series BL, 12/08 at 101 AA- 5,609,355 5.300%, 12/01/12 (Alternative Minimum Tax) 10,000,000 State of California, Veterans General Obligation Bonds, Series BN, 12/03 at 101 AA- 9,189,200 5.450%, 12/01/28 3,500,000 State Public Works Board of the State of California, Lease Revenue 10/02 at 102 Aaa 3,801,560 Bonds (The Trustees of the California State University), 1992 Series A (Various California State University Projects), 6.625%, 10/01/10 (Pre-refunded to 10/01/02) Principal Optional Call Market Amount Description Provisions* Ratings** Value - ------------------------------------------------------------------------------------------------------------------------------------ California (continued) $ 17,000,000 State Public Works Board of the State of California, Lease Revenue 11/04 at 102 Aaa $ 19,219,350 Bonds (Department of Corrections), 1994 Series A (California State Prison-Monterey County (Soledad II)), 7.000%, 11/01/19 (Pre-refunded to 11/01/04) 36,735,000 City of Houston, Texas, Water and Sewer System, Junior Lien Revenue No Opt. Call AAA 6,080,377 Refunding Bonds, Series 1998A, 0.000%, 12/01/28 2,500,000 The Community Redevelopment Agency of the City of Los Angeles, 7/00 at 100 BBB*** 2,525,125 California, Central Business District Redevelopment Project Tax Allocation Refunding Bonds, Series G, 6.750%, 7/01/10 6,700,000 County of Orange, California, 1996 Recovery Certificates of Participation, 7/06 at 102 AAA 6,710,519 Series A, 6.000%, 7/01/26 9,190,000 City of San Jose Financing Authority (Santa Clara County, California), 9/01 at 102 Aa3 9,486,286 1993 Revenue Bonds, Series C (Convention Center Refunding Project), 6.400%, 9/01/22 2,255,000 Southern California Home Financing Authority, Single Family Mortgage 3/01 at 102 AAA 2,328,536 Revenue Bonds (GNMA and FNMA Mortgage-Backed Securities Program), 1991 Issue A, 7.350%, 9/01/24 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ Colorado - 4.5% City and County of Denver, Colorado, Airport System Revenue Bonds, Series 1991A: 3,425,000 8.750%, 11/15/23 (Alternative Minimum Tax) (Pre-refunded to 11/15/01) 11/01 at 102 Aaa 3,785,653 9,485,000 8.750%, 11/15/23 (Alternative Minimum Tax) 11/01 at 102 BBB+ 10,283,352 3,040,000 8.000%, 11/15/25 (Alternative Minimum Tax) 11/01 at 100 BBB+ 3,197,594 City and County of Denver, Colorado, Airport System Revenue Bonds, Series 1990A: 8,765,000 8.500%, 11/15/23 (Alternative Minimum Tax) 11/00 at 102 BBB+ 9,220,254 15,910,000 8.000%, 11/15/25 (Alternative Minimum Tax) 11/00 at 102 BBB+ 16,656,497 City and County of Denver, Colorado, Airport System Revenue Bonds, Series 1991D: 3,165,000 7.750%, 11/15/21 (Alternative Minimum Tax) 11/01 at 102 BBB+ 3,370,852 3,825,000 7.000%, 11/15/25 (Alternative Minimum Tax) 11/01 at 100 BBB+ 3,938,909 5,110,000 County of Pueblo, Colorado, Hospital Refunding and Improvement 9/01 at 100 N/R*** 5,455,232 Revenue Bonds (Parkview Episcopal Medical Center, Inc. Project), Series 1991B, 8.300%, 9/01/11 (Pre-refunded to 9/01/01) - ------------------------------------------------------------------------------------------------------------------------------------ Florida - 1.2% 5,250,000 Dade County Industrial Development Authority, Solid Waste Disposal 2/01 at 102 AA- 5,487,458 Revenue Bonds (Florida Power and Light Company Project), Series 1991, 7.150%, 2/01/23 (Alternative Minimum Tax) 8,485,000 St. Lucie County, Florida, Solid Waste Disposal Revenue Bonds 2/01 at 102 AA- 8,863,431 (Florida Power and Light Company Project), Series 1991, 7.150%, 2/01/23 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ Georgia - 2.0% Clayton County Hospital Authority, Georgia, Revenue Anticipation Certificates (Southern Regional Medical Center Project), Series 1991: 2,900,000 6.500%, 8/01/10 (Pre-refunded to 8/01/01) 8/01 at 102 AAA 3,065,677 4,500,000 7.000%, 8/01/13 (Pre-refunded to 8/01/01) 8/01 at 102 AAA 4,793,985 15,900,000 The Fulton-De Kalb Hospital Authority, Georgia, Revenue Certificates, 1/01 at 102 AAA 16,693,092 Series 1991 (Grady Memorial Hospital), 6.900%, 1/01/20 (Pre-refunded to 1/01/01) - ------------------------------------------------------------------------------------------------------------------------------------ Illinois - 9.4% 6,000,000 Central Lake County Joint Action Water Agency, Lake County, 5/00 at 102 AAA 6,211,860 Water Revenue Bonds, Series 1990A, 7.000%, 5/01/19 (Pre-refunded to 5/01/00) 10,000,000 Central Lake County Joint Action Water Agency, Lake County, 5/01 at 102 AAA 10,591,500 Water Revenue Bonds, Series 1991, 7.000%, 5/01/20 (Pre-refunded to 5/01/01) Chicago School Reform Board of Trustees of the Board of Education of the City of Chicago, Unlimited Tax General Obligation Bonds (Dedicated Tax Revenues), Series 1998B-1: 9,400,000 0.000%, 12/01/14 No Opt. Call AAA 3,835,482 4,400,000 0.000%, 12/01/15 No Opt. Call AAA 1,673,408 6,260,000 City of Chicago, Chicago O'Hare International Airport, Special Facility 11/00 at 103 Baa2 6,648,496 Revenue Bonds (United Air Lines, Inc. Project), Series 1984B, 8.850%, 5/01/18 24,430,000 The County of Cook, Illinois, General Obligation Bonds, Series 1991, 11/01 at 102 AAA 26,068,276 6.750%, 11/01/18 (Pre-refunded to 11/01/01) Principal Optional Call Market Amount Description Provisions* Ratings** Value - ------------------------------------------------------------------------------------------------------------------------------------ Illinois (continued) Illinois Development Finance Authority, Multifamily Housing Revenue Bonds, Series 1992 (Town and Garden Apartments Project): $ 5,050,000 7.800%, 3/01/06 (Alternative Minimum Tax) 3/02 at 102 N/R $ 5,336,386 1,150,000 7.200%, 9/01/08 (Alternative Minimum Tax) 3/02 at 102 N/R 1,200,370 11,000,000 Illinois Health Facilities Authority, Hospital Revenue Bonds, 11/03 at 102 AAA 12,160,500 Series 1993-A (Hinsdale Hospital), 7.000%, 11/15/19 2,765,000 Illinois Housing Development Authority, Section 8 Elderly Housing 9/02 at 102 A 2,848,973 Revenue Bonds (Garden House of Maywood Development), Series 1992, 7.000%, 9/01/18 5,265,000 Illinois Health Facilities Authority, Revenue Refunding Bonds, 8/01 at 100 AAA 5,425,425 Series1991A (Rockford Memorial Hospital), 6.000%, 8/15/21 (Pre-refunded to 8/15/01) 14,500,000 Illinois Health Facilities Authority, Revenue Bonds, Series 1991 8/01 at 102 AA 15,317,655 (Northwestern Memorial Hospital), 6.750%, 8/15/11 3,000,000 Illinois Health Facilities Authority, Revenue Refunding Bonds, 8/01 at 102 AAA 3,182,910 Series 1991 (Sherman Hospital Project), 6.750%, 8/01/21 (Pre-refunded to 8/01/01) 3,590,000 Joliet Regional Port District Airport Facilities, Revenue Bonds, 7/07 at 103 N/R 3,591,328 Lewis University Airport, Series 1997A, 7.250%, 7/01/18 (Alternative Minimum Tax) 10,575,000 Regional Transportation Authority, Cook, DuPage, Kane, Lake, 6/02 at 100 AAA 11,017,564 McHenry and Will Counties, Illinois, General Obligation Bonds, Series 1992A, 6.125%, 6/01/22 - ------------------------------------------------------------------------------------------------------------------------------------ Indiana - 1.0% 5,905,000 Indiana Health Facility Financing Authority, Hospital Revenue Bonds, 7/01 at 102 AAA 6,276,543 Series 1992 (Community Hospitals Projects), 7.000%, 7/01/11 (Pre-refunded to 7/01/01) 5,125,000 City of Petersburg, Indiana, Pollution Control Refunding Revenue Bonds, 12/04 at 102 Aa2 5,480,111 Series 1995A (Indianapolis Power and Light Company Project), 6.625%, 12/01/24 - ------------------------------------------------------------------------------------------------------------------------------------ Iowa - 0.4% 4,500,000 Polk County, Iowa, Health Facilities Revenue Bonds, Catholic Health 11/01 at 101 AAA 4,761,225 Corporation (Mercy Health Center of Central Iowa Project), Series 1991, 6.750%, 11/01/15 (Pre-refunded to 11/01/01) - ------------------------------------------------------------------------------------------------------------------------------------ Kansas - 1.5% City of Merriam, Kansas, Hospital Refunding Revenue Bonds, Series 1991B (Shawnee Mission Medical Center, Inc. Project): 7,380,000 7.250%, 9/01/11 (Pre-refunded to 9/01/01) 9/01 at 102 AAA 7,889,368 10,000,000 7.250%, 9/01/21 (Pre-refunded to 9/01/01) 9/01 at 102 AAA 10,690,200 - ------------------------------------------------------------------------------------------------------------------------------------ Kentucky - 2.0% 10,000,000 City of Danville, Kentucky, Multi-City Lease Revenue Bonds (Louisville 3/02 at 102 AAA 10,714,900 and Jefferson County Metropolitan Sewer District Sewer and Drainage System Revenue Project), Series 1991-G, 6.800%, 3/01/19 (Pre-refunded to 3/01/02) 3,000,000 Kentucky Development Finance Authority, Hospital Facilities Revenue 9/01 at 102 N/R*** 3,196,920 Bonds, Series 1991 (St. Claire Medical Center, Inc. Project), 7.125%, 9/01/21 (Pre-refunded to 9/01/01) 10,085,000 Kentucky Housing Corporation, Housing Revenue Bonds (Federally 1/05 at 102 AAA 10,393,702 Insured or Guaranteed Mortgage Loans), 1995 Series B, 6.625%, 7/01/26 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ Maryland - 1.7% Community Development Administration, Department of Housing and Community Development, State of Maryland, Single Family Program Bonds, 1991 Fourth Series: 13,235,000 7.450%, 4/01/20 (Alternative Minimum Tax) 4/01 at 102 Aa2 13,602,007 3,250,000 7.450%, 4/01/32 (Alternative Minimum Tax) 4/01 at 102 Aa2 3,346,135 3,385,000 Community Development Administration, Department of Housing and 5/01 at 102 Aa2 3,502,324 Community Development, State of Maryland, Multifamily Housing Revenue Bonds (Insured Mortgage Loans), 1991 Series E, 7.100%, 5/15/28 Principal Optional Call Market Amount Description Provisions* Ratings** Value - ------------------------------------------------------------------------------------------------------------------------------------ Massachusetts - 8.3% $ 8,185,000 Boston Water and Sewer Commission, General Revenue Bonds 11/08 at 101 AAA $ 6,814,913 (Senior Series), 1998 Series D, 4.750%, 11/01/22 19,600,000 Massachusetts Bay Transportation Authority, General Transportation 3/01 at 102 Aaa 20,680,548 System Bonds, 1991 Series A, 7.000%, 3/01/22 (Pre-refunded to 3/01/01) 15,000,000 Massachusetts Industrial Finance Agency, Resource Recovery Revenue 7/01 at 103 N/R 16,157,850 Bonds (SEMASS Project), Series 1991A, 9.000%, 7/01/15 3,285,000 Massachusetts Industrial Finance Agency, Resource Recovery Revenue 7/01 at 103 N/R 3,538,733 Bonds (SEMASS Project), Series 1991B, 9.250%, 7/01/15 (Alternative Minimum Tax) 6,000,000 Massachusetts Industrial Finance Agency, Resource Recovery 12/08 at 102 BBB 5,261,640 Revenue Refunding Bonds (Ogden Haverhill Project), Series 1998A, 5.600%, 12/01/19 (Alternative Minimum Tax) 26,000,000 Massachusetts Turnpike Authority, Metropolitan Highway System 1/07 at 102 AAA 21,670,480 Revenue Bonds, 1997 Series C (Senior), 5.000%, 1/01/37 33,500,000 Massachusetts Turnpike Authority, Metropolitan Highway System 1/09 at 101 AAA 27,838,165 Revenue Bonds, 1999 Series A (Subordinated), 5.000%, 1/01/39 - ------------------------------------------------------------------------------------------------------------------------------------ Michigan - 3.8% 7,000,000 City of Grand Rapids, Michigan, Water Supply System Refunding 1/01 at 102 AAA 7,269,850 Revenue Bonds, Series 1991, 6.250%, 1/01/11 5,000,000 Michigan State Hospital Finance Authority, Hospital Revenue Bonds 8/01 at 102 Aaa 5,372,450 (The Detroit Medical Center Obligated Group), Series 1991A, 7.500%, 8/15/11 (Pre-refunded to 8/15/01) 7,425,000 Michigan State Hospital Finance Authority, Hospital Revenue Bonds 11/09 at 101 AA- 7,132,381 (Henry Ford Health System), Series 1999A, 6.000%, 11/15/24 8,500,000 Michigan Strategic Fund, Limited Obligation Revenue Bonds 12/02 at 102 BBB 8,572,165 (Waste Management, Inc. Project), Series 1992, 6.625%, 12/01/12 (Alternative Minimum Tax) 16,875,000 Michigan Strategic Fund, Limited Obligation Refunding Revenue 12/01 at 102 AAA 17,801,775 Bonds (The Detroit Edison Company, Pollution Control Bonds Project), Collateralized Series 1991DD, 6.875%, 12/01/21 - ------------------------------------------------------------------------------------------------------------------------------------ Minnesota - 0.9% 3,655,000 The Dakota County Housing and Redevelopment Authority, the No Opt. Call AAA 4,655,483 Washington County Housing and Redevelopment Authority, and the City of Bloomington, Minnesota, Single Family Residential Mortgage Revenue Bonds (Mortgage Backed Program), Series 1988, 8.450%, 9/01/19 (Alternative Minimum Tax) 3,560,000 Minnesota Housing Finance Agency, Single Family Mortgage Bonds, 1/04 at 102 AA 3,685,597 1994 Series J, 6.950%, 7/01/26 (Alternative Minimum Tax) 2,420,000 Washington County Housing and Redevelopment Authority, Multifamily 8/01 at 102 AAA 2,516,969 Housing Revenue Bonds (FHA-Insured Mortgage Loan - Cottages Phase III Project), Series 1991, 7.650%, 8/01/32 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ Mississippi - 0.5% 3,285,000 Canton Housing Development Corporation, 1990 Multifamily Mortgage No Opt. Call AAA 3,854,652 Revenue Refunding Bonds (Canton Estates Apartments Project - FHA-Insured Mortgage, Section 8 Assisted Project), Series A, 7.750%, 8/01/24 1,185,000 Charter Mortgage Corporation, 1990 Multifamily Mortgage Revenue 8/01 at 100 AAA 1,379,020 Refunding Bonds (Church Garden Apartments - FHA-Insured Mortgage, Section 8 Assisted Project), Series A, 7.750%, 8/01/21 1,305,000 Pearl Housing Development Corporation, 1990 Multifamily Mortgage 12/00 at 100 AAA 1,322,996 Revenue Refunding Bonds (Rose Garden Apartments Project - FHA- Insured Mortgage, Section 8 Assisted Project), Series A, 7.750%, 8/01/22 - ------------------------------------------------------------------------------------------------------------------------------------ Missouri - 0.9% The Industrial Development Authority of the County of Jackson, State of Missouri, Health Care System Revenue Bonds, St. Mary's Hospital of Blue Springs Issue, Series 1994: 5,465,000 6.500%, 7/01/12 7/02 at 102 Baa1 5,508,010 5,605,000 7.000%, 7/01/22 7/02 at 102 Baa1 5,806,780 Principal Optional Call Market Amount Description Provisions* Ratings** Value - ------------------------------------------------------------------------------------------------------------------------------------ Montana - 0.6% $ 7,000,000 City of Forsyth, Rosebud County, Montana, Pollution Control Revenue 8/01 at 102 AAA $ 7,364,840 Refunding Bonds (Puget Sound Power and Light Company, Colstrip Project), Series 1992, 7.050%, 8/01/21 - ------------------------------------------------------------------------------------------------------------------------------------ Nebraska - 1.6% 11,000,000 Nebraska Investment Finance Authority, Single Family Housing Revenue 3/05 at 101 1/2 AAA 11,350,570 Bonds, 1995 Series A, 6.800%, 3/01/35 (Alternative Minimum Tax) 8,000,000 Nebraska Investment Finance Authority, Single Family Housing Revenue 3/05 at 101 1/2 AAA 8,115,680 Bonds, 1995 Series B, 6.450%, 3/01/35 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ New Hampshire - 0.3% 3,085,000 New Hampshire Housing Finance Authority, Single Family Residential 7/01 at 102 Aa3 3,228,267 Mortgage Bonds, 1991 Series C, 7.100%, 1/01/23 - ------------------------------------------------------------------------------------------------------------------------------------ New Jersey - 1.0% 13,000,000 Pollution Control Financing Authority of Camden County (Camden County, 12/01 at 102 B2 12,621,180 New Jersey), Solid Waste Disposal and Resource Recovery System Revenue Bonds, Series 1991 D, 7.250%, 12/01/10 - ------------------------------------------------------------------------------------------------------------------------------------ New York - 14.2% 2,140,000 Niagara Falls Housing and Commercial Rehabilitation Corporation, No Opt. Call AA 2,380,600 1992 Multifamily Mortgage Revenue Refunding Bonds (FHA-Insured Mortgage, Section 8 Assisted Project), 7.350%, 8/01/23 6,000,000 The City of New York, General Obligation Bonds, Fiscal 1997 Series H, 8/07 at 101 A- 6,008,040 6.125%, 8/01/25 5,475,000 The City of New York, General Obligation Bonds, Fiscal 1995 Series B, 8/04 at 101 Aaa 6,120,119 7.250%, 8/15/19 (Pre-refunded to 8/15/04) The City of New York, General Obligation Bonds, Fiscal 1996 Series J (Subseries J-1): 255,000 6.000%, 2/15/24 (Pre-refunded to 2/15/06) 2/06 at 101 1/2 A-*** 272,906 9,075,000 6.000%, 2/15/24 2/06 at 101 1/2 A- 9,010,931 6,700,000 The City of New York, General Obligation Bonds, Fiscal 1995 Series F, 2/05 at 101 A-*** 7,318,879 6.625%, 2/15/25 (Pre-refunded to 2/15/05) 5,660,000 The City of New York, General Obligation Bonds, Fiscal 1993 Series B, 10/02 at 101 1/2 A-*** 6,096,329 6.750%, 10/01/17 (Pre-refunded to 10/01/02) 14,190,000 New York City Municipal Water Finance Authority, Water and Sewer 6/05 at 101 AAA 13,985,522 System Revenue Bonds, Fiscal 1996 Series A, 5.875%, 6/15/25 10,795,000 New York City Municipal Water Finance Authority, Water and Sewer No Opt. Call AAA 9,590,602 System Revenue Bonds, Fiscal 1998 Series B, 5.250%, 6/15/29 Dormitory Authority of the State of New York, State University Educational Facilities Revenue Bonds, Series 1990A: 13,000,000 7.400%, 5/15/01 5/00 at 102 A 13,464,360 11,750,000 7.700%, 5/15/12 (Pre-refunded to 5/15/00) 5/00 at 102 Aaa 12,222,585 8,325,000 Dormitory Authority of the State of New York, Menorah Campus, Inc., 8/01 at 102 AA*** 8,923,151 FHA-Insured Mortgage Revenue Bonds, Series 1991, 7.400%, 2/01/31 (Pre-refunded to 8/01/01) Dormitory Authority of the State of New York, Mental Health Services Facilities Improvement Revenue Bonds, Series 1997A: 13,060,000 5.750%, 8/15/22 2/07 at 102 A- 12,445,788 5,000,000 5.750%, 2/15/27 2/07 at 102 A- 4,727,050 4,550,000 Dormitory Authority of the State of New York, Mental Health Services 2/07 at 102 A- 4,262,668 Facilities Improvement, Revenue Bonds, Series 1997B, 5.500%, 8/15/17 21,075,000 New York Local Government Assistance Corporation, New York, 4/01 at 102 AAA 22,423,168 Series 1991B, 7.500%, 4/01/20 (Pre-refunded to 4/01/01) 8,000,000 New York State Medical Care Facilities Finance Agency, New York 2/05 at 102 AAA 8,754,880 Hospital, FHA-Insured Mortgage Revenue Bonds, 1994 Series A, 6.500%, 8/15/29 (Pre-refunded to 2/15/05) 5,000,000 New York State Medical Care Facilities Finance Agency, Hospital 2/05 at 102 AAA 5,540,850 Medical Center Secured Hospital Revenue Bonds, Series 1995-A, 6.850%, 2/15/17 (Pre-refunded to 2/15/05) Principal Optional Call Market Amount Description Provisions* Ratings** Value - ------------------------------------------------------------------------------------------------------------------------------------ New York (continued) New York State Medical Care Facilities Finance Agency, FHA-Insured Mortgage Project Revenue Bonds, 1995 Series F: $ 4,230,000 6.200%, 8/15/15 8/05 at 102 AA $ 4,582,528 4,250,000 6.300%, 8/15/25 8/05 at 102 AA 4,625,445 8,025,000 New York State Thruway Authority, General Revenue Bonds, Series C, 1/05 at 102 AAA 8,588,355 6.000%, 1/01/25 (Pre-refunded to 1/01/05) 3,280,000 Penfield-Crown Oak Housing Development Corporation, 1991 2/03 at 100 AAA 3,398,966 Multifamily Mortgage Revenue Refunding Bonds (Crown Oak Estates - FHA-Insured Mortgage, Section 8 Assisted Project), Series A, 7.350%, 8/01/23 - ------------------------------------------------------------------------------------------------------------------------------------ North Carolina - 0.9% 10,500,000 North Carolina Eastern Municipal Power Agency, Power System 1/02 at 102 BBB 10,716,195 Revenue Bonds, Refunding Series 1991A, 6.250%, 1/01/03 - ------------------------------------------------------------------------------------------------------------------------------------ Ohio - 0.9% 4,800,000 County of Butler, Ohio, Hospital Facilities Revenue Refunding and 1/02 at 102 Baa1 4,994,064 Improvement Bonds, Series 1991 (Fort Hamilton-Hughes Memorial Hospital Center), 7.500%, 1/01/10 6,175,000 Ohio Housing Finance Agency, Residential Mortgage Revenue Bonds 3/05 at 102 AAA 6,371,180 (GNMA Mortgage-Backed Securities Program), 1995 Series A-2, 6.625%, 3/01/26 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ Oklahoma - 4.0% 6,035,000 Oklahoma County Home Finance Authority (Oklahoma County, Oklahoma), 7/01 at 102 Aaa 6,262,942 Single Family Mortgage Revenue Refunding Bonds, 1991 Series A, 8.750%, 7/01/12 17,510,000 Pottawatomie County Home Finance Authority (Oklahoma), Municipal No Opt. Call AAA 22,189,022 Refunding, Collateralized Mortgage Obligations, Series 1991A, 8.625%, 7/01/10 10,000,000 Trustees of the Tulsa Municipal Airport Trust, 1988 Adjustable Rate 12/00 at 102 Baa2 10,368,300 Revenue Obligations, 7.375%, 12/01/20 (Alternative Minimum Tax) 10,100,000 Trustees of the Tulsa Municipal Airport Trust, Revenue Bonds, 6/01 at 102 Baa2 10,580,962 Series 1991, 7.600%, 12/01/30 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ Pennsylvania - 0.5% Falls Township Hospital Authority, Refunding Revenue Bonds, the Delaware Valley Medical Center Project (FHA-Insured Mortgage), Series 1992: 3,215,000 6.900%, 8/01/11 8/02 at 102 AAA 3,311,096 3,000,000 7.000%, 8/01/22 8/02 at 102 AAA 3,217,170 - ------------------------------------------------------------------------------------------------------------------------------------ Rhode Island - 0.4% 5,260,000 Rhode Island Housing and Mortgage Finance Corporation, 4/00 at 100 Aa2 5,295,505 Mortgage Finance Revenue Bonds, 1988 Series A (Corporation Supplemental Insurance Program), 8.250%, 10/01/08 - ------------------------------------------------------------------------------------------------------------------------------------ South Carolina - 0.6% 6,500,000 Lexington County Health Services District, Inc., South Carolina, Hospital 10/01 at 102 AAA 6,925,880 Revenue Bonds, Series 1991, 6.750%, 10/01/18 (Pre-refunded to 10/01/01) - ------------------------------------------------------------------------------------------------------------------------------------ Tennessee - 0.9% 10,300,000 Metropolitan Nashville Airport Authority (Tennessee), Airport 7/01 at 102 AAA 10,854,552 Improvement Revenue Bonds, Refunding Series 1991C, 6.625%, 7/01/07 - ------------------------------------------------------------------------------------------------------------------------------------ Texas - 9.2% 14,360,000 Alliance Airport Authority, Inc., Special Facilities Revenue Bonds, 12/00 at 102 Baa2 14,944,739 Series 1990 (American Airlines, Inc. Project), 7.500%, 12/01/29 (Alternative Minimum Tax) Arlington Independent School District (Tarrant County, Texas), Unlimited Tax Refunding and Improvement Bonds, Series 1995: 8,225,000 0.000%, 2/15/11 (Pre-refunded to 2/15/05) 2/05 at 71 15/16 Aaa 4,546,862 3,410,000 0.000%, 2/15/11 2/05 at 71 15/16 Aaa 1,782,680 9,880,000 0.000%, 2/15/14 (Pre-refunded to 2/15/05) 2/05 at 58 25/32 Aaa 4,462,500 4,105,000 0.000%, 2/15/14 2/05 at 58 25/32 Aaa 1,713,961 Principal Optional Call Market Amount Description Provisions* Ratings** Value - ------------------------------------------------------------------------------------------------------------------------------------ Texas (continued) $ 6,500,000 Bell County Health Facilities Development Corporation, Retirement 11/08 at 101 A- $ 5,548,075 Facility Revenue Bonds (Buckner Retirement Services, Inc., Obligated Group Project), Series 1998, 5.250%, 11/15/19 5,600,000 Dallas-Fort Worth International Airport Facility Improvement 11/00 at 102 Baa2 5,814,704 Corporation, American Airlines, Inc. Revenue Bonds, Series 1990, 7.500%, 11/01/25 (Alternative Minimum Tax) 6,270,000 Fort Worth Housing Finance Corporation, Home Mortgage Revenue 10/01 at 103 Aa 6,577,167 Refunding Bonds, Series 1991A, 8.500%, 10/01/11 11,000,000 Harris County Health Facilities Development Corporation (Texas), 10/09 at 101 AA 9,485,520 Hospital Revenue Bonds (Texas Children's Hospital Project), Series 1999A, 5.250%, 10/01/29 7,815,000 City of Houston, Texas, Airport System Subordinate Lien Revenue Bonds, 7/01 at 102 AAA 8,265,144 Series 1991B, 6.625%, 7/01/22 (Pre-refunded to 7/01/01) 13,175,000 Houston Independent School District (Texas), Limited Tax Schoolhouse 2/09 at 100 AAA 10,747,902 and Refunding Bonds, Series 1999A, 4.750%, 2/15/26 17,345,000 City of Houston, Texas, Water and Sewer System Junior Lien Revenue 12/01 at 102 AAA 17,843,148 Refunding Bonds, Series 1991C, 6.375%, 12/01/17 7,650,000 Port of Corpus Christi Authority of Nueces County, Texas, Revenue 5/06 at 101 BBB- 6,971,522 Refunding Bonds, Series 1992 (Union Pacific Corporation Project), 5.350%, 11/01/10 14,680,000 San Antonio Independent School District (Bexar County, Texas), 8/09 at 100 AAA 14,223,746 Unlimited Tax School Building Bonds, Series 1999, 5.800%, 8/15/29 - ------------------------------------------------------------------------------------------------------------------------------------ Utah - 0.5% 5,800,000 Carbon County, Utah, Solid Waste Disposal Refunding Revenue Bonds 2/05 at 102 BBB 6,200,954 (Laidlaw Inc./ECDC Environmental, L.C. Project), 1995 Series A, 7.500%, 2/01/10 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ Virginia - 1.0% 3,860,000 Industrial Development Authority of the City of Roanoke, Virginia, 7/00 at 100 AAA 3,926,855 Hospital Revenue Bonds (Roanoke Memorial Hospitals, Community Hospital of Roanoke Valley and Franklin Memorial Hospital Project), Series 1990, 6.500%, 7/01/25 (Pre-refunded to 7/01/00) 8,320,000 Virginia Housing Development Authority, Commonwealth Mortgage 1/02 at 102 AA+ 8,533,907 Bonds, 1992 Series A, 7.150%, 1/01/33 - ------------------------------------------------------------------------------------------------------------------------------------ Washington - 5.7% 3,010,000 Camas School District No. 117, Clark County, Washington, Unlimited 12/05 at 100 AAA 3,202,700 Tax General Obligation Bonds, 1995, 6.000%, 12/01/14 (Pre-refunded to 12/01/05) 4,185,000 Public Utility District No. 1 of Douglas County, Washington, Wells 9/06 at 106 AA- 5,166,927 Hydro-Electric Revenue Bonds, Series of 1986, 8.750%, 9/01/18 12,415,000 Federal Way School District No. 210, King County, Washington, 12/03 at 100 A1*** 13,490,015 Unlimited Tax General Obligation Bonds, 1991, 6.950%, 12/01/11 (Pre-refunded to 12/01/03) 1,675,000 Spokane Downtown Foundation, Parking Revenue Bonds, 8/08 at 102 BBB- 1,480,449 Series 1998 (River Park Square Project), 5.600%, 8/01/19 4,000,000 North Thurston School District No. 3, Thurston County, Washington, 12/02 at 100 A 4,196,360 Unlimited Tax General Obligation Bonds, Series 1992, 6.500%, 12/01/09 4,750,000 Washington Health Care Facilities Authority, Revenue Bonds, 1/01 at 102 A*** 4,994,863 Series 1991 (Yakima Valley Memorial Hospital Association), 7.250%, 1/01/21 (Pre-refunded to 1/01/01) 18,000,000 Washington Health Care Facilities Authority, Revenue Bonds, 8/13 at 102 AAA 14,921,100 Series 1998 (Harrison Memorial Hospital), 5.000%, 8/15/28 14,850,000 Washington Public Power Supply System, Nuclear Project No. 2 7/00 at 102 Aaa 15,438,209 Refunding Revenue Bonds, Series 1990B, 7.000%, 7/01/12 (Pre-refunded to 7/01/00) 4,000,000 Washington Public Power Supply System, Nuclear Project No. 2 7/04 at 102 Aa1 3,921,640 Refunding Revenue Bonds, Series 1994A, 5.375%, 7/01/11 4,175,000 Washington State University, Recreation Center Revenue Bonds, 4/08 at 101 AAA 3,521,403 Series 1998, 5.000%, 4/01/28 Principal Optional Call Market Amount Description Provisions* Ratings** Value - ------------------------------------------------------------------------------------------------------------------------------------ Wisconsin - 1.5% $ 7,000,000 Wisconsin Housing and Economic Development Authority, Housing Revenue 1/02 at 102 AA $ 7,370,720 Bonds, 1992 Series A, 6.850%, 11/01/12 10,820,000 Wisconsin Health and Educational Facilities Authority, Revenue Bonds, 12/01 at 102 AAA 11,572,200 Series 1991-B (Novus Health Group), 6.750%, 12/15/20 (Pre-refunded to 12/15/01) - ------------------------------------------------------------------------------------------------------------------------------------ Wyoming - 0.2% 1,820,000 Wyoming Community Development Authority, Single Family Mortgage 11/01 at 103 AA 1,892,380 Bonds, Series G 1988 (Federally Insured or Guaranteed Mortgage Loans), 7.250%, 6/01/21 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ $1,249,565,000 Total Investments - (cost $1,187,601,214) - 98.4% 1,209,088,564 ============== Other Assets Less Liabilities - 1.6% 19,756,902 -------------------------------------------------------------------------------------------------------------------- Net Assets - 100% $1,228,845,466 ==================================================================================================================== * Optional Call Provisions (not covered by the report of independent auditors): Dates (month and year) and prices of the earliest optional call or redemption. There may be other call provisions at varying prices at later dates. ** Ratings (not covered by the report of independent auditors): Using the higher of Standard & Poor's or Moody's rating. *** Securities are backed by an escrow or trust containing sufficient U.S. government or U.S. government agency securities which ensures the timely payment of principal and interest. Securities are normally considered to be equivalent to AAA rated securities. N/R Investment is not rated. See accompanying notes to financial statements.
Portfolio of Investments NUVEEN PREMIER MUNICIPAL INCOME FUND, INC. (NPF) October 31,1999
Principal Optional Call Market Amount Description Provisions* Ratings** Value - ------------------------------------------------------------------------------------------------------------------------------------ Alabama - 1.0% $ 4,360,000 Alabama Higher Education Loan Corporation, Student Loan Revenue No Opt. Call AAA $ 4,522,890 Refunding Bonds, Series 1994-D, 5.850%, 9/01/04 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ Alaska - 0.2% 685,000 Municipality of Anchorage, Alaska, Home Mortgage Revenue Bonds 3/02 at 102 AAA 715,798 (Mortgage-Backed Securities Program), 1992, 8.000%, 3/01/09 - ------------------------------------------------------------------------------------------------------------------------------------ Arizona - 4.9% 5,500,000 Arizona Educational Loan Marketing Corporation, 1992 Educational No Opt. Call Aa2 5,645,365 Loan Revenue Bonds, Series B, 6.950%, 3/01/01 (Alternative Minimum Tax) 3,650,000 Gilbert Unified School District No. 41 of Maricopa County, Arizona, 7/04 at 100 AAA 3,870,460 School Improvement Bonds, Project of 1993, Series 1994C, 6.100%, 7/01/14 (Pre-refunded to 7/01/04) 11,260,000 Yuma Regional Medical Center on Behalf of Hospital District No. 1 of 8/02 at 101 1/2 N/R*** 12,442,075 Yuma County, Arizona, Hospital Revenue Improvement and Refunding Bonds (Yuma Regional Medical Center Project), Series 1992, 8.000%, 8/01/17 (Pre-refunded to 8/01/02) - ------------------------------------------------------------------------------------------------------------------------------------ Arkansas - 1.0% 1,245,000 Arkansas Development Finance Authority, Single Family Mortgage 7/05 at 102 AAA 1,284,242 Revenue Bonds, 1994 Series C (Mortgage-Backed Securities Program), 6.600%, 7/01/17 1,570,000 Arkansas Development Finance Authority, Single Family Mortgage 7/05 at 102 AAA 1,614,541 Revenue Bonds, 1995 Series B (Mortgage-Backed Securities Program), 6.550%, 7/01/18 (Alternative Minimum Tax) 211,895 Drew County Public Facilities Board, Single Family Mortgage Revenue 8/03 at 103 Aaa 222,558 Refunding Bonds, Series 1993A, 7.900%, 8/01/11 825,000 Residential Housing Facilities Board of Greene County, Arkansas, 1/02 at 103 Aa 855,913 Subordinated Mortgage Revenue Bonds, Series 1991-1, 7.250%, 1/01/10 349,457 Public Facilities Board of Stuttgart, Arkansas, Single Family Mortgage 9/03 at 103 Aaa 371,245 Revenue Refunding Bonds, Series 1993A, 7.900%, 9/01/11 - ------------------------------------------------------------------------------------------------------------------------------------ California - 2.7% 33,000,000 Foothill/Eastern Transportation Corridor Agency (California), Toll Road No Opt. Call Aaa 12,107,700 Revenue Bonds, Series 1995A, 0.000%, 1/01/17 - ------------------------------------------------------------------------------------------------------------------------------------ Colorado - 1.3% Colorado Health Facilities Authority, Hospital Refunding Revenue Bonds (National Jewish Center for Immunology and Respiratory Medicine Project), Series 1992: 1,160,000 6.600%, 2/15/02 No Opt. Call N/R*** 1,188,710 1,250,000 6.875%, 2/15/12 (Pre-refunded to 2/15/02) 2/02 at 102 N/R*** 1,333,950 3,040,000 7.100%, 2/15/22 (Pre-refunded to 2/15/02) 2/02 at 102 N/R*** 3,258,181 - ------------------------------------------------------------------------------------------------------------------------------------ Connecticut - 1.5% 4,735,000 Connecticut Housing Finance Authority, Housing Mortgage Finance 5/06 at 102 AA 4,750,389 Program Bonds, 1997 Series A, Subseries A-4, 6.200%, 11/15/22 (Alternative Minimum Tax) 2,000,000 Connecticut Housing Finance Authority, Housing Mortgage Finance 5/06 at 102 AA 2,042,340 Program Bonds, 1996 Series C-2, 6.250%, 11/15/18 - ------------------------------------------------------------------------------------------------------------------------------------ District of Columbia - 1.5% 2,000,000 District of Columbia, Hospital Revenue Refunding Bonds 8/02 at 102 A3*** 2,132,160 (Washington Hospital Center Issue), Series 1992A 7.000%, 8/15/05 (Pre-refunded to 8/15/02) Principal Optional Call Market Amount Description Provisions* Ratings** Value - ------------------------------------------------------------------------------------------------------------------------------------ District of Columbia (continued) District of Columbia Housing Finance Agency, Multifamily Housing Refunding Revenue Bonds, Series 1992B (FHA-Insured Mortgage Loans - Section 8 Assisted Project): $ 920,000 7.200%, 9/01/12 9/02 at 102 Aa $ 960,931 3,505,000 7.250%, 3/01/24 9/02 at 102 Aa 3,671,978 - ------------------------------------------------------------------------------------------------------------------------------------ Florida - 0.9% 4,000,000 Dade County, Florida, Aviation Bonds, Series 1996A, 5.750%, 10/01/18 10/06 at 102 AAA 3,863,440 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ Georgia - 2.2% 8,000,000 George L. Smith II World Congress Center Authority, Refunding Revenue 7/10 at 101 AAA 7,363,440 Bonds (Domed Stadium Project), Series 2000, 5.500%, 7/01/20 (Alternative Minimum Tax) (DD, settling on 4/04/00) 2,000,000 Municipal Electric Authority of Georgia, Power Revenue Bonds, No Opt. Call AAA 2,346,600 Series EE, 7.250%, 1/01/24 - ------------------------------------------------------------------------------------------------------------------------------------ Idaho - 0.3% 1,245,000 Idaho Housing and Finance Association, Single Family Mortgage 7/06 at 102 Aa1 1,279,076 Bonds, 1996 Series E, 6.350%, 7/01/14 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ Illinois - 21.6% 4,500,000 City of Chicago (Illinois), General Obligation Adjustable Rate Bonds, 7/02 at 101 1/2 AAA 4,834,485 Central Public Library Project, Series C of 1988, 6.850%, 1/01/17 (Pre-refunded to 7/01/02) Chicago School Reform Board of Trustees of the Board of Education of the City of Chicago, Illinois, Unlimited Tax General Obligation Bonds (Dedicated Tax Revenues), Series 1998A: 10,000,000 0.000%, 12/01/20 No Opt. Call AAA 2,725,500 12,900,000 0.000%, 12/01/24 No Opt. Call AAA 2,734,284 5,000,000 Chicago School Reform Board of Trustees of the Board of Education No Opt. Call AAA 1,775,900 of the City of Chicago, Illinois, Unlimited Tax General Obligation Bonds (Dedicated Tax Revenues), Series 1998B-1, 0.000%, 12/01/16 Chicago School Reform Board of Trustees of the Board of Education of the City of Chicago, Illinois, Unlimited Tax General Obligation Bonds (Dedicated Tax Revenues), Series 1999A: 15,000,000 0.000%, 12/01/21 No Opt. Call AAA 3,835,650 10,000,000 0.000%, 12/01/23 No Opt. Call AAA 2,254,800 1,100,000 Public Building Commission of Chicago (Illinois), Building Revenue No Opt. Call AAA 1,216,732 Bonds, Series B of 1990 (Board of Education of the City of Chicago), 7.000%, 1/01/15 13,000,000 City of Chicago, Illinois, Wastewater Transmission Revenue Bonds, 1/06 at 102 AAA 11,253,190 Series 1995, 5.125%, 1/01/25 8,045,000 Town of Cicero, Cook County, Illinois, General Obligation Tax 12/04 at 102 N/R*** 9,152,636 Increment Bonds, Series 1995A, 8.125%, 12/01/12 (Pre-refunded to 12/01/04) 6,970,000 Illinois Development Finance Authority, Multifamily Housing Revenue 3/02 at 102 N/R 7,365,269 Bonds, Series 1992 (Town and Garden Apartments Project), 7.800%, 3/01/06 (Alternative Minimum Tax) Illinois Development Finance Authority, Multifamily Housing Bonds (Affordable Housing Preservation Foundation Project), Series 1990 Subseries B (FHA-Insured Mortgage Loans-Lawless Gardens Project): 600,000 7.650%, 7/01/07 1/02 at 105 AAA 645,420 7.650%, 12/31/31 1/02 at 105 AAA 5,653,182 7,400,000 Illinois Health Facilities Authority, Revenue Bonds, Series 1992 7/02 at 102 BBB+ 7,963,510 (Trinity Medical Center), 7.000%, 7/01/12 125,000 Illinois Health Facilities Authority, Revenue Refunding Bonds, 4/02 at 102 AA-*** 133,858 Series 1992A (Evangelical Hospitals Corporation), 6.750%, 4/15/12 (Pre-refunded to 4/15/02) 4,660,000 Illinois Housing Development Authority, Section 8 Elderly Housing 9/02 at 102 A 4,801,524 Revenue Bonds (Garden House of Maywood Development), Series 1992, 7.000%, 9/01/18 685,000 Illinois Housing Development Authority, Section 8 Elderly Housing 1/03 at 102 A*** 735,026 Revenue Bonds (Morningside North Development), Series 1992D, 6.600%, 1/01/07 (Pre-refunded to 1/01/03) 6,390,000 State of Illinois, Build Illinois Bonds (Sales Tax Revenue Bonds), 6/00 at 102 AAA 6,630,520 Series S, 6.800%, 6/15/12 (Pre-refunded to 6/15/00) Metropolitan Pier and Exposition Authority (Illinois), McCormick Place Expansion Project Refunding Bonds, Series 1996A: 8,330,000 0.000%, 12/15/16 No Opt. Call AAA 2,951,652 9,400,000 0.000%, 12/15/18 No Opt. Call AAA 2,901,968 10,775,000 0.000%, 12/15/24 No Opt. Call AAA 2,278,374 Principal Optional Call Market Amount Description Provisions* Ratings** Value - ------------------------------------------------------------------------------------------------------------------------------------ Illinois (continued) $ 2,000,000 Onterie Center Housing Finance Corporation (An Illinois Not For Profit 7/02 at 102 AAA $ 2,095,180 Corporation), Mortgage Revenue Refunding Bonds, Series 1992A (FHA-Insured Mortgage Loan - Onterie Center Project), 7.050%, 7/01/27 Village of Sugar Grove, Kane County, Illinois, Waterworks and Sewerage Refunding Revenue Bonds, Series 1992: 1,395,000 7.500%, 5/01/17 (Pre-refunded to 5/01/02) 5/02 at 102 N/R*** 1,517,551 1,440,000 7.500%, 5/01/17 5/02 at 102 N/R 1,503,619 5,415,000 Town of Wood River, Wood River Township Hospital, Madison County, 2/04 at 102 N/R 5,481,009 Illinois, General Obligation Bonds (Alternate Revenue Source), Series 1993, 6.625%, 2/01/14 5,360,000 Town of Wood River, Wood River Township Hospital, Madison County, 2/04 at 102 N/R 5,391,249 Illinois, General Obligation Tort Immunity Bonds, Series 1993, 6.500%, 2/01/14 - ------------------------------------------------------------------------------------------------------------------------------------ Indiana - 2.0% 29,255,000 Indianapolis (Indiana), Local Public Improvement Bond Bank, No Opt. Call AAA 6,062,806 Series 1999E, 0.000%, 2/01/25 2,860,000 PHM Elementary/Middle School Building Corporation (St. Joseph No Opt. Call A 3,051,849 County, Indiana), First Mortgage Bonds, Series 1994, 6.300%, 1/15/09 - ------------------------------------------------------------------------------------------------------------------------------------ Iowa - 0.4% 1,655,000 Iowa Student Loan Liquidity Corporation, Student Loan Revenue 12/02 at 102 Aaa 1,691,443 Bonds, Senior Series B, 5.750%, 12/01/06 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ Kansas - 0.9% 2,135,000 City of Hutchinson, Kansas, Single Family Mortgage Revenue Refunding 6/02 at 103 A 2,241,942 Bonds, Series 1992, 8.875%, 12/01/12 6,440,000 The Unified Government of Wyandotte County, Kansas City, Kansas, No Opt. Call AAA 1,762,435 Sales Tax Special Obligation Revenue Bonds (Kansas International Speedway Corporation Project), Series 1999, 0.000%, 12/01/20 - ------------------------------------------------------------------------------------------------------------------------------------ Kentucky - 1.2% 5,000,000 Kentucky Rural Economic Development Authority, Economic 7/02 at 102 N/R 5,201,000 Development Project Revenue Bonds, Series 1992 (Donnelly Corporation Project), 8.125%, 7/01/12 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ Louisiana - 0.3% 1,310,000 Louisiana Housing Finance Agency, Mortgage Revenue Bonds 9/05 at 103 AAA 1,358,470 (GNMA Collateralized Mortgage Loan - St. Dominic Assisted Care Facility), Series 1995, 6.850%, 9/01/25 - ------------------------------------------------------------------------------------------------------------------------------------ Maine - 1.8% 7,965,000 Maine Educational Loan Marketing Corporation, Subordinate Student No Opt. Call A 7,976,151 Loan Revenue Bonds, Series 1994-2, 6.250%, 11/01/06 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ Maryland - 1.4% 6,000,000 Anne Arundel County, Maryland, Multifamily Housing Revenue No Opt. Call BBB 6,348,660 Bonds (Woodside Apartments Project), Series 1994, 7.450%, 12/01/24 (Alternative Minimum Tax) (Mandatory put 12/01/03) - ------------------------------------------------------------------------------------------------------------------------------------ Massachusetts - 7.6% 30,000 Massachusetts Municipal Wholesale Electric Company, Power No Opt. Call BBB+ 33,823 Supply System Revenue Bonds, 1987 Series A, 8.750%, 7/01/18 2,450,000 Massachusetts Health and Educational Facilities Authority, Revenue 4/02 at 102 AAA 2,630,394 Bonds, New England Deaconess Hospital Issue, Series D, 6.875%, 4/01/22 (Pre-refunded to 4/01/02) 3,875,000 Massachusetts Health and Educational Facilities Authority, 2/04 at 102 Aa2 3,764,214 Revenue Refunding Bonds, Youville Hospital Issue (FHA-Insured Project), Series B, 6.000%, 2/15/25 6,585,000 Massachusetts Health and Educational Facilities Authority, Catholic 5/08 at 102 AAA 5,531,268 Health East Issue, Series 1998B, 5.000%, 11/15/28 9,085,000 Massachusetts Industrial Finance Agency, Resource Recovery 7/01 at 103 N/R 9,786,725 Revenue Bonds, SEMASS Project, Series 1991B, 9.250%, 7/01/15 (Alternative Minimum Tax) 2,000,000 Massachusetts Housing Finance Agency, Rental Housing Mortgage 7/07 at 101 AAA 1,813,460 Revenue Bonds, 1997 Series C, 5.625%, 7/01/40 (Alternative Minimum Tax) Principal Optional Call Market Amount Description Provisions* Ratings** Value - ------------------------------------------------------------------------------------------------------------------------------------ Massachusetts (continued) $ 9,780,000 Massachusetts Water Resources Authority, General Revenue Bonds, 7/02 at 102 AAA $ 10,538,243 1992 Series A, 6.750%, 7/15/12 (Pre-refunded to 7/15/02) - ------------------------------------------------------------------------------------------------------------------------------------ Michigan - 0.9% 1,975,000 Charter Township of Clinton, County of Macomb, State of Michigan, 4/09 at 101 AAA 1,479,453 1998 General Obligation Unlimited Tax Police Building Bonds, 4.000%, 4/01/18 2,500,000 Wayne County Building Authority (State of Michigan), Capital 3/02 at 102 A-*** 2,739,075 Improvement Bonds, Series 1992A (Limited Tax General Obligation), 8.000%, 3/01/17 (Pre-refunded to 3/01/02) - ------------------------------------------------------------------------------------------------------------------------------------ Minnesota - 2.2% 10,780,000 Northwest Minnesota Multi-County Housing and Redevelopment 10/04 at 102 N/R 9,828,665 Authority, Governmental Housing Revenue Bonds (Pooled Housing Program), Series 1994A, 8.125%, 10/01/26 - ------------------------------------------------------------------------------------------------------------------------------------ Mississippi - 0.6% 8,610,000 Mississippi Home Corporation, Residual Revenue Capital Appreciation 3/04 at 41 21/32 Aaa 2,879,615 Bonds, Series 1992-I, 0.000%, 9/15/16 - ------------------------------------------------------------------------------------------------------------------------------------ Missouri - 0.2% 1,060,000 Missouri State Health and Educational Facilities Authority, Revenue 6/08 at 101 AAA 918,564 Bonds (SSM Health Care), Series 1998A, 5.000%, 6/01/22 - ------------------------------------------------------------------------------------------------------------------------------------ Nebraska - 3.8% 2,830,000 City of Grand Island, Nebraska, Electric System Revenue Bonds, No Opt. Call A+*** 2,996,347 1977 Series, 6.100%, 9/01/12 2,350,000 Nebraska Higher Education Loan Program Inc., Senior Subordinate No Opt. Call AAA 2,319,356 Bonds, Series A-5B, 6.250%, 6/01/18 (Alternative Minimum Tax) 10,935,000 Omaha Public Power District (Nebraska), Electric System Revenue 2/02 at 101 1/2 AAA 11,581,587 Bonds, 1992 Series A, 6.500%, 2/01/17 (Pre-refunded to 2/01/02) - ------------------------------------------------------------------------------------------------------------------------------------ New Hampshire - 0.2% 990,000 New Hampshire Municipal Bond Bank, Educational Institutions No Opt. Call N/R 1,031,917 Division Revenue Bonds (1994 Coe-Brown Northwood Academy Project), 7.250%, 5/01/09 - ------------------------------------------------------------------------------------------------------------------------------------ New York - 13.6% 3,500,000 The City of New York, General Obligation Bonds, Fiscal 1992 Series B, No Opt. Call A- 3,630,270 7.500%, 2/01/01 1,000,000 The City of New York, General Obligation Bonds, Fiscal 1995 Series A, No Opt. Call A- 1,089,130 7.000%, 8/01/04 2,075,000 The City of New York, General Obligation Bonds, Fiscal 1990 Series F, 11/01 at 101 1/2 AAA 2,272,602 8.400%, 11/15/05 (Pre-refunded to 11/15/01) 2,000,000 The City of New York, General Obligation Bonds, Fiscal 1992 Series C, 8/02 at 101 1/2 AAA 2,142,620 Subseries C-1, 6.625%, 8/01/12 (Pre-refunded to 8/01/02) 4,000,000 The City of New York, General Obligation Bonds, Fiscal 1996 Series J, 2/06 at 101 1/2 A- 3,913,840 Subseries J-1, 5.875%, 2/15/19 The City of New York, General Obligation Bonds, Fiscal 1991 Series D: 3,920,000 9.500%, 8/01/02 (Pre-refunded to 8/01/01) 8/01 at 101 1/2 Aaa 4,321,212 80,000 9.500%, 8/01/02 8/01 at 101 1/2 A- 87,501 The City of New York, General Obligation Bonds, Fiscal 1995 Series E: 450,000 6.500%, 8/01/02 No Opt. Call Aaa 474,651 1,100,000 6.500%, 8/01/02 No Opt. Call A- 1,153,273 3,080,000 6.600%, 8/01/04 No Opt. Call A- 3,305,487 8,480,000 New York City Transitional Finance Authority, Future Tax Secured Bonds, 8/07 at 101 AA 7,504,546 Fiscal 1998 Series A, 5.125%, 8/15/21 6,500,000 Dormitory Authority of the State of New York, City University System 7/00 at 102 Aaa 6,787,690 Consolidated Revenue Bonds, Series 1990A, 7.625%, 7/01/20 (Pre-refunded to 7/01/00) 5,000,000 New York Local Government Assistance Corporation, New York, 4/01 at 102 AAA 5,319,850 Series 1991B, 7.500%, 4/01/20 (Pre-refunded to 4/01/01) 5,970,000 New York State Medical Care Facilities Finance Agency, Hospital and 8/02 at 102 AAA 6,049,401 Nursing Home FHA-Insured Mortgage Revenue Bonds, 1992 Series B, 6.200%, 8/15/22 Principal Optional Call Market Amount Description Provisions* Ratings** Value - ------------------------------------------------------------------------------------------------------------------------------------ New York (continued) $ 4,755,000 New York State Medical Care Facilities Finance Agency, St. Luke's- 8/03 at 102 AAA $ 4,778,585 Roosevelt Hospital Center FHA-Insured Mortgage Revenue Bonds, 1993 Series A, 5.600%, 8/15/13 8,450,000 New York State Urban Development Corporation, State Facilities 4/01 at 102 Aaa 8,990,547 Revenue Bonds, Series 1991, 7.500%, 4/01/20 (Pre-refunded to 4/01/01) - ------------------------------------------------------------------------------------------------------------------------------------ North Carolina - 3.2% 10,300,000 North Carolina Eastern Municipal Power Agency, Power System No Opt. Call AAA 10,317,819 Revenue Bonds, Refunding Series 1993 B, 6.000%, 1/01/22 2,130,000 North Carolina Housing Finance Agency, Multifamily Revenue 7/02 at 102 AA 2,237,075 Refunding Bonds (1992 Refunding Bond Resolution), Series B, 6.900%, 7/01/24 2,000,000 North Carolina Housing Finance Agency, Home Ownership Revenue 7/08 at 101 AA 1,785,900 Bonds, Series 1-A (1998 Trust Agreement), 5.375%, 1/01/29 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ Ohio - 0.7% 2,110,000 Cleveland-Rock Glen Housing Assistance Corporation, Mortgage Revenue 7/04 at 103 AAA 2,206,300 Refunding Bonds, Series 1994A (FHA-Insured Mortgage Loans - Section 8 Assisted Projects), 6.750%, 1/15/25 755,000 Toledo-Lucas County Port Authority, Development Revenue Bonds 5/00 at 102 N/R 774,011 (Northwest Ohio Bond Fund), Series 1992A, 7.750%, 5/15/07 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ Oregon - 0.3% 1,230,000 State of Oregon Housing and Community Services Department, 7/07 at 101 1/2 Aa2 1,132,018 Mortgage Revenue Bonds (Single Family Mortgage Program), 1997 Series H, 5.650%, 7/01/28 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ Pennsylvania - 5.1% 5,000,000 Delaware County Industrial Development Authority (Pennsylvania), 1/08 at 102 BB- 4,584,550 Refunding Revenue Bonds, Series A 1997 (Resource Recovery Facility), 6.200%, 7/01/19 2,000,000 Falls Township Hospital Authority, Refunding Revenue Bonds, the 8/02 at 102 AAA 2,144,780 Delaware Valley Medical Center Project (FHA-Insured Mortgage), Series 1992, 7.000%, 8/01/22 755,000 Northampton County Hospital Authority (Pennsylvania), Hospital No Opt. Call BBB 764,354 Revenue Bonds (Easton Hospital), Series A of 1992, 6.900%, 1/01/02 7,540,000 City of Philadelphia, Pennsylvania, Water and Sewer Revenue Bonds, No Opt. Call AAA 8,190,777 Tenth Series, 7.350%, 9/01/04 2,500,000 The Hospitals and Higher Education Facilities Authority of 8/02 at 102 A- 2,638,925 Philadelphia, Hospital Revenue Bonds (Children's Seashore House), Series 1992A, 7.000%, 8/15/12 4,450,000 The Hospitals and Higher Education Facilities Authority of Philadelphia, 8/00 at 100 A- 4,697,287 Hospital Revenue Bonds (Children's Seashore House), Series 1992B, 7.000%, 8/15/22 - ------------------------------------------------------------------------------------------------------------------------------------ Tennessee - 0.7% 3,650,000 The Health and Educational Facilities Board of the City of Johnson City, 1/09 at 101 AAA 3,176,157 Tennessee, Hospital Revenue Refunding and Improvement Bonds, Series 1998C (Johnson City Medical Center Hospital), 5.125%, 7/01/25 - ------------------------------------------------------------------------------------------------------------------------------------ Texas - 1.2% 4,157,069 General Services Commission (An Agency of the State of Texas), 9/05 at 100 A 4,386,331 as Lessee, Participation Interests, 7.500%, 9/01/22 1,135,000 Victoria Housing Finance Corporation, Single Family Mortgage Revenue No Opt. Call Aaa 1,199,286 Refunding Bonds, Series 1995, 8.125%, 1/01/11 - ------------------------------------------------------------------------------------------------------------------------------------ Utah - 0.6% 875,000 Utah Housing Finance Agency, Single Family Mortgage Bonds, 1/07 at 102 AA 888,195 1996 Series C, 6.450%, 7/01/14 (Alternative Minimum Tax) 2,070,000 Utah Housing Finance Agency, Single Family Mortgage Bonds, 7/07 at 101 1/2 AA 2,015,663 1997 Series F, 5.750%, 7/01/15 (Alternative Minimum Tax) Principal Optional Call Market Amount Description Provisions* Ratings** Value - ------------------------------------------------------------------------------------------------------------------------------------ Virginia - 1.9% $ 3,200,000 Suffolk Redevelopment and Housing Authority, Multifamily Housing 7/02 at 104 Baa2 $ 3,384,288 Revenue Refunding Bonds, Series 1994 (Chase Heritage at Dulles Project), 7.000%, 7/01/24 (Mandatory put 7/01/04) 5,000,000 Virginia Housing Development Authority, Commonwealth Mortgage 1/02 at 102 AA+ 5,125,750 Bonds, 1992 Series A, 7.100%, 1/01/22 - ------------------------------------------------------------------------------------------------------------------------------------ Washington - 3.3% 9,500,000 State of Washington, General Obligation and General Obligation No Opt. Call AA+ 10,194,260 Refunding Bonds, Series 1992A and AT-6, 6.250%, 2/01/11 2,500,000 Washington Health Care Facilities Authority, Revenue Bonds, 2/02 at 102 AA- 2,669,300 Series 1992 (Sacred Heart Medical Center, Spokane), 6.875%, 2/15/12 2,000,000 Washington Public Power Supply System, Nuclear Project No. 3 7/00 at 102 Aa1 2,077,380 Refunding Revenue Bonds, Series 1990B, 7.375%, 7/01/04 - ------------------------------------------------------------------------------------------------------------------------------------ West Virginia - 0.3% 1,530,000 West Virginia Housing Development Fund, Housing Finance Bonds, 5/02 at 102 AAA 1,547,044 1992 Series B, 7.200%, 11/01/20 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ Wisconsin - 2.1% 2,985,000 Silver Lake Sanitary District, Waushara County, Wisconsin, Sewer 10/02 at 100 N/R*** 3,276,065 System Mortgage Revenue Bonds, 8.000%, 10/01/18 (Pre-refunded to 10/01/02) 5,950,000 Wisconsin Housing and Economic Development Authority, 1/02 at 102 AA 6,265,110 Housing Revenue Bonds, 1992 Series A, 6.850%, 11/01/12 - ------------------------------------------------------------------------------------------------------------------------------------ $ 536,408,421 Total Investments - (cost $424,475,375) - 95.6% 430,743,362 ============= Short-Term Investments - 4.3% 3,000,000 Farmington Pollution Control Revenue Bonds (Arizona Public A-1+ 3,000,000 Service Co., Four Corners Project), 1994 Series B, Variable Rate Demand Bonds, 3.550%, 9/01/24+ 2,090,000 Gulf Coast Waste Disposal Authority, Pollution Control Revenue VMIG-1 2,090,000 Refunding Bonds (EXXON Project), 1995 Series, Variable Rate Demand Bonds, 3.5000% 6/01/20+ 4,500,000 Maricopa County Pollution Control Corporation, Pollution Control A-1+ 4,500,000 Revenue Refunding Bonds (Arizona Public Service Company, Palo Verde Project), 1994 Series C, Variable Rate Demand Bonds, 3.600%, 5/01/29+ 5,000,000 New York State Energy Research and Development Authority, A-1+ 5,000,000 Pollution Control Revenue Bonds (Niagara Mohawk Power Corporation), Variable Rate Demand Bonds, 3.700%, 7/01/15+ 5,000,000 New York State Energy Research and Development Authority, Pollution VMIG-1 5,000,000 (New York State Electric and Gas Corporation Project), 1994 Series C, Variable Rate Demand Bonds, 3.600%, 6/01/29+ - ------------------------------------------------------------------------------------------------------------------------------------ $ 19,590,000 Total Short-Term Investments - (cost $19,590,000) 19,590,000 ============= Other Assets Less Liabilities - 0.1% 175,916 -------------------------------------------------------------------------------------------------------------------- Net Assets - 100% $450,509,278 ==================================================================================================================== * Optional Call Provisions (not covered by the report of independent auditors): Dates (month and year) and prices of the earliest optional call or redemption. There may be other call provisions at varying prices at later dates. ** Ratings (not covered by the report of independent auditors): Using the higher of Standard & Poor's or Moody's rating. *** Securities are backed by an escrow or trust containing sufficient U.S. government or U.S. government agency securities which ensures the timely payment of principal and interest. Securities are normally considered to be equivalent to AAA rated securities. N/R Investment is not rated. (DD) Security purchased on a delayed delivery basis (note 1). + Security has a maturity of more than one year, but has variable rate and demand features which qualify it as a short-term security. The rate disclosed is that currently in effect. This rate changes periodically based on market conditions or a specified market index. See accompanying notes to financial statements.
Statement of Net Assets October 31, 1999
Investment Select Quality Premier Quality Quality Income Income - ------------------------------------------------------------------------------------------------------------------------------------ Assets Investments in municipal securities, at market value (note 1) $794,366,976 $742,852,607 $1,209,088,564 $430,743,362 Temporary investments in short-term municipal securities, at amortized cost, which approximates market value (note 1) -- 26,400,000 -- 19,590,000 Cash 1,897,540 5,740,973 -- 1,866,295 Receivables: Interest 16,152,524 13,637,178 24,314,541 7,086,350 Investments sold 835,535 6,638,103 3,321,395 1,087,980 Other assets 44,655 73,109 63,947 33,528 - ------------------------------------------------------------------------------------------------------------------------------------ Total assets 813,297,230 795,341,970 1,236,788,447 460,407,515 - ------------------------------------------------------------------------------------------------------------------------------------ Liabilities Cash overdraft -- -- 1,921,641 -- Payable for investments purchased 7,018,293 36,624,130 -- 7,669,520 Accrued expenses: Management fees (note 6) 428,446 403,625 648,048 243,769 Other 343,817 388,403 536,496 305,828 Preferred share dividends payable 138,279 129,695 202,354 64,998 Common share dividends payable 2,859,917 2,694,029 4,634,442 1,614,122 - ------------------------------------------------------------------------------------------------------------------------------------ Total liabilities 10,788,752 40,239,882 7,942,981 9,898,237 - ------------------------------------------------------------------------------------------------------------------------------------ Net assets (note 7) $802,508,478 $755,102,088 $1,228,845,466 $450,509,278 ==================================================================================================================================== Preferred shares, at liquidation value $301,000,000 $279,000,000 $ 452,000,000 $165,000,000 ==================================================================================================================================== Preferred shares outstanding 12,040 11,160 18,080 6,600 ==================================================================================================================================== Common shares outstanding 35,748,960 33,887,479 54,204,494 20,051,953 ==================================================================================================================================== Net asset value per Common share outstanding (net assets less Preferred shares at liquidation value, divided by Common shares outstanding) $ 14.03 $ 14.05 $ 14.33 $ 14.24 ==================================================================================================================================== See accompanying notes to financial statements.
Statement of Operations Year Ended October 31, 1999
Investment Select Quality Premier Quality Quality Income Income - ------------------------------------------------------------------------------------------------------------------------------------ Investment Income (note 1) $ 49,437,431 $ 47,431,888 $ 77,986,628 $ 27,936,951 - ------------------------------------------------------------------------------------------------------------------------------------ Expenses Management fees (note 6) 5,143,232 4,821,379 7,741,242 2,887,357 Preferred shares - auction fees 625,000 600,002 1,000,001 349,999 Preferred shares - dividend disbursing agent fees 42,521 42,521 52,521 22,519 Shareholders' servicing agent fees and expenses 86,212 76,739 126,523 45,606 Custodian's fees and expenses 135,007 123,124 185,879 102,526 Directors' fees and expenses (note 6) 7,775 7,293 11,903 4,311 Professional fees 20,857 20,678 22,069 19,765 Shareholders' reports - printing and mailing expenses 190,103 178,863 289,038 112,277 Stock exchange listing fees 32,445 32,657 48,410 24,262 Investor relations expense 67,883 63,177 102,926 37,563 Other expenses 40,055 33,051 57,043 21,137 - ------------------------------------------------------------------------------------------------------------------------------------ Total expenses before custodian fee credit 6,391,090 5,999,484 9,637,555 3,627,322 Custodian fee credit (note 1) (28,418) (21,222) (36,554) (28,392) - ------------------------------------------------------------------------------------------------------------------------------------ Net expenses 6,362,672 5,978,262 9,601,001 3,598,930 - ------------------------------------------------------------------------------------------------------------------------------------ Net investment income 43,074,759 41,453,626 68,385,627 24,338,021 - ------------------------------------------------------------------------------------------------------------------------------------ Realized and Unrealized Gain (Loss) from Investments Net realized gain (loss) from investment transactions (notes 1 and 4) 338,511 5,858,883 1,695,294 (103,628) Net change in unrealized appreciation (depreciation) of investments (70,205,721) (61,475,965) (81,930,200) (30,317,584) - ------------------------------------------------------------------------------------------------------------------------------------ Net gain (loss) from investments (69,867,210) (55,617,082) (80,234,906) (30,421,212) - ------------------------------------------------------------------------------------------------------------------------------------ Net increase (decrease) in net assets from operations $ (26,792,451) $ (14,163,456) $ (11,849,279) $ (6,083,191) ==================================================================================================================================== See accompanying notes to financial statements.
Statement of Changes in Net Assets
Investment Quality Select Quality - ------------------------------------------------------------------------------------------------------------------------------------ Year Ended Year Ended Year Ended Year Ended 10/31/99 10/31/98 10/31/99 10/31/98 - ------------------------------------------------------------------------------------------------------------------------------------ Operations Net investment income $ 43,074,759 $ 43,332,821 $ 41,453,626 $ 41,272,737 Net realized gain (loss) from investment transactions (notes 1 and 4) 338,511 (173,095) 5,858,883 1,614,188 Net change in unrealized appreciation (depreciation) of investments (70,205,721) 8,887,953 (61,475,965) 4,958,232 - ------------------------------------------------------------------------------------------------------------------------------------ Net increase (decrease) in net assets from operations (26,792,451) 52,047,679 (14,163,456) 47,845,157 - ------------------------------------------------------------------------------------------------------------------------------------ Distributions to Shareholders (note 1) From undistributed net investment income: Common shareholders (34,265,653) (34,939,388) (32,426,412) (32,677,563) Preferred shareholders (8,670,344) (8,696,853) (8,276,367) (8,430,282) From accumulated net realized gains from investment transactions: Common shareholders -- (369,064) -- -- Preferred shareholders -- (89,825) -- -- - ------------------------------------------------------------------------------------------------------------------------------------ Decrease in net assets from distributions to shareholders (42,935,997) (44,095,130) (40,702,779) (41,107,845) - ------------------------------------------------------------------------------------------------------------------------------------ Capital Share Transactions (note 2) Common shares: Net proceeds from shares issued to shareholders due to reinvestment of distributions 1,719,616 2,861,357 1,695,759 3,267,092 Preferred shares: Net proceeds from sale of shares 50,366,822 -- 38,498,158 -- - ------------------------------------------------------------------------------------------------------------------------------------ Net increase in net assets from capital share transactions 52,086,438 2,861,357 40,193,917 3,267,092 - ------------------------------------------------------------------------------------------------------------------------------------ Net increase (decrease) in net assets (17,642,010) 10,813,906 (14,672,318) 10,004,404 Net assets at the beginning of year 820,150,488 809,336,582 769,774,406 759,770,002 - ------------------------------------------------------------------------------------------------------------------------------------ Net assets at the end of year $802,508,478 $820,150,488 $755,102,088 $769,774,406 ==================================================================================================================================== Balance of undistributed net investment income at the end of year $ 759,320 $ 620,558 $ 1,404,794 $ 653,947 ==================================================================================================================================== See accompanying notes to financial statements.
Quality Income Premier Income - ------------------------------------------------------------------------------------------------------------------------------------ Year Ended Year Ended Year Ended Year Ended 10/31/99 10/31/98 10/31/99 10/31/98 - ------------------------------------------------------------------------------------------------------------------------------------ Operations Net investment income $ 68,385,627 $ 68,283,197 $ 24,338,021 $ 24,290,823 Net realized gain (loss) from investment transactions (notes 1 and 4) 1,695,294 2,914,470 (103,628) 90,877 Net change in unrealized appreciation (depreciation) of investments (81,930,200) 3,095,167 (30,317,584) 3,062,136 - ------------------------------------------------------------------------------------------------------------------------------------ Net increase (decrease) in net assets from operations (11,849,279) 74,292,834 (6,083,191) 27,443,836 - ------------------------------------------------------------------------------------------------------------------------------------ Distributions to Shareholders (note 1) From undistributed net investment income: Common shareholders (55,411,229) (54,962,532) (19,324,413) (19,804,242) Preferred shareholders (13,547,036) (13,962,725) (4,817,350) (4,932,868) From accumulated net realized gains from investment transactions: Common shareholders -- -- (45,889) -- Preferred shareholders -- -- (11,424) -- - ------------------------------------------------------------------------------------------------------------------------------------ Decrease in net assets from distributions to shareholders (68,958,265) (68,925,257) (24,199,076) (24,737,110) - ------------------------------------------------------------------------------------------------------------------------------------ Capital Share Transactions (note 2) Common shares: Net proceeds from shares issued to shareholders due to reinvestment of distributions 6,887,216 7,504,802 2,004,966 2,635,126 Preferred shares: Net proceeds from sale of shares 51,357,544 -- 24,638,050 -- - ------------------------------------------------------------------------------------------------------------------------------------ Net increase in net assets from capital share transactions 58,244,760 7,504,802 26,643,016 2,635,126 - ------------------------------------------------------------------------------------------------------------------------------------ Net increase (decrease) in net assets (22,562,784) 12,872,379 (3,639,251) 5,341,852 Net assets at the beginning of year 1,251,408,250 1,238,535,871 454,148,529 448,806,677 - ------------------------------------------------------------------------------------------------------------------------------------ Net assets at the end of year $1,228,845,466 $1,251,408,250 $450,509,278 $454,148,529 ==================================================================================================================================== Balance of undistributed net investment income at the end of year $ 943,351 $ 1,515,989 $ 645,422 $ 449,164 ==================================================================================================================================== See accompanying notes to financial statements.
NOTES TO FINANCIAL STATEMENTS 1. GENERAL INFORMATION AND SIGNIFICANT ACCOUNTING POLICIES The National Funds (the "Funds") covered in this report and their corresponding New York Stock Exchange symbols are Nuveen Investment Quality Municipal Fund, Inc. (NQM), Nuveen Select Quality Municipal Fund, Inc. (NQS), Nuveen Quality Income Municipal Fund, Inc. (NQU) and Nuveen Premier Municipal Income Fund, Inc. (NPF). Each Fund invests primarily in a diversified portfolio of municipal obligations issued by state and local government authorities. The Funds are registered under the Investment Company Act of 1940 as closed-end, diversified management investment companies. The following is a summary of significant accounting policies followed by the Funds in the preparation of their financial statements in accordance with generally accepted accounting principles. Securities Valuation The prices of municipal bonds in each Fund's investment portfolio are provided by a pricing service approved by the Fund's Board of Directors. When price quotes are not readily available (which is usually the case for municipal securities), the pricing service establishes fair market value based on yields or prices of municipal bonds of comparable quality, type of issue, coupon, maturity and rating, indications of value from securities dealers and general market conditions. Temporary investments in securities that have variable rate and demand features qualifying them as short-term securities are valued at amortized cost, which approximates market value. Securities Transactions Securities transactions are recorded on a trade date basis. Realized gains and losses from such transactions are determined on the specific identification method. Securities purchased or sold on a when-issued or delayed delivery basis may have extended settlement periods. The securities so purchased are subject to market fluctuation during this period. The Funds have instructed the custodian to segregate assets in a separate account with a current value at least equal to the amount of the when-issued and delayed delivery purchase commitments. At October 31, 1999, Select Quality and Premier Income had outstanding when-issued and delayed delivery purchase commitments of $14,709,625 and $7,669,520, respectively. There were no such outstanding purchase commitments in either Investment Quality or Quality Income. Investment Income Interest income is determined on the basis of interest accrued, adjusted for amortization of premiums and accretion of discounts on long-term debt securities when required for federal income tax purposes. Federal Income Taxes Each Fund is a separate taxpayer for federal income tax purposes. Each Fund intends to comply with the requirements of the Internal Revenue Code applicable to regulated investment companies and to distribute all of its tax-exempt net investment income, in addition to any significant amounts of net realized capital gains and/or market discount realized from investment transactions. The Funds currently consider significant net realized capital gains and/or market discount as amounts in excess of $.01 per Common share. Furthermore, each Fund intends to satisfy conditions which will enable interest from municipal securities, which is exempt from regular federal income tax, to retain such tax-exempt status when distributed to shareholders of the Funds. All monthly tax-exempt income dividends paid during the fiscal year ended October 31, 1999, have been designated Exempt Interest Dividends. Net realized capital gain and market discount distributions are subject to federal taxation. Dividends and Distributions to Shareholders Tax-exempt net investment income is declared monthly as a dividend and payment is made or reinvestment is credited to shareholder accounts on the first business day after month-end. Net realized capital gains and/or market discount from investment transactions, if any, are distributed to shareholders not less frequently than annually. Furthermore, capital gains are distributed only to the extent they exceed available capital loss carryforwards. Distributions to shareholders of tax-exempt net investment income, net realized capital gains and/or market discount are recorded on the ex-dividend date. The amount and timing of distributions are determined in accordance with federal income tax regulations, which may differ from generally accepted accounting principles. Accordingly, temporary over-distributions as a result of these differences may occur and will be classified as either distributions in excess of net investment income, distributions in excess of net realized gains and/or distributions in excess of net ordinary taxable income from investment transactions, where applicable. Preferred Shares The Funds have issued and outstanding $25,000 stated value Preferred shares. Each Fund's Preferred shares are issued in more than one Series. The dividend rate on each Series may change every seven days, as set by the auction agent. The number of shares outstanding, by Series and in total, for each Fund is as follows:
Investment Select Quality Premier Quality Quality Income Income - --------------------------------------------------------------------------------------------------------- Number of shares: Series M 2,500 2,000 3,000 1,000 Series T 2,500 2,000 3,000 2,800 Series W 2,500 2,800 3,000 -- Series W2 -- -- 2,080 Series Th 2,040 1,560 4,000 2,800 Series F 2,500 2,800 3,000 -- - --------------------------------------------------------------------------------------------------------- Total 12,040 11,160 18,080 6,600 =========================================================================================================
Effective May 14, 1999, Investment Quality issued 2,040 Series Th $25,000 stated value Preferred shares. Effective June 4, 1999, Select Quality issued 1,560 Series Th $25,000 stated value Preferred shares. Effective May 14, 1999, Quality Income issued 2,080 Series W2 $25,000 stated value Preferred shares. Effective June 11, 1999, Premier Income issued 1,000 Series M $25,000 stated value Preferred shares. Derivative Financial Instruments The Funds may invest in transactions in certain derivative financial instruments including futures, forward, swap and option contracts, and other financial instruments with similar characteristics. Although the Funds are authorized to invest in such financial instruments, and may do so in the future, they did not make any such investments during the fiscal year ended October 31, 1999. Custodian Fee Credit Each Fund has an arrangement with the custodian bank whereby the custodian fees and expenses are reduced by credits earned on each Fund's cash on deposit with the bank. Such deposit arrangements are an alternative to overnight investments. Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results may differ from those estimates. 2. FUND SHARES Transactions in Common and Preferred shares were as follows:
Investment Quality Select Quality - ---------------------------------------------------------------------------------------------------------- Year Ended Year Ended Year Ended Year Ended 10/31/99 10/31/98 10/31/99 10/31/98 - ---------------------------------------------------------------------------------------------------------- Common shares issued to shareholders due to reinvestment of distributions 110,452 177,666 106,069 205,528 ========================================================================================================== Preferred shares sold 2,040 -- 1,560 -- ========================================================================================================== Quality Income Premier Income - ---------------------------------------------------------------------------------------------------------- Year Ended Year Ended Year Ended Year Ended 10/31/99 10/31/98 10/31/99 10/31/98 - ---------------------------------------------------------------------------------------------------------- Common shares issued to shareholders due to reinvestment of distributions 427,864 454,528 124,386 161,445 ========================================================================================================== Preferred shares sold 2,080 -- 1,000 -- ==========================================================================================================
Notes to Financial Statements (continued) 3. Distributions to Common Shareholders The Funds declared Common share dividend distributions from their tax-exempt net investment income which were paid on December 1, 1999, to shareholders of record on November 15, 1999, as follows:
Investment Select Quality Premier Quality Quality Income Income - --------------------------------------------------------------------------------------------------------- Dividend per share $.0800 $.0795 $.0855 $.0805 =========================================================================================================
4. SECURITIES TRANSACTIONS Purchases and sales (including maturities) of investments in long-term municipal securities and short-term municipal securities for the fiscal year ended October 31, 1999, were as follows:
Investment Select Quality Premier Quality Quality Income Income - --------------------------------------------------------------------------------------------------------- Purchases: Long-term municipal securities $192,306,103 $237,195,958 $198,495,142 $55,628,332 Short-term municipal securities 134,105,000 140,750,000 16,800,000 79,990,000 Sales and maturities: Long-term municipal securities 129,667,684 286,198,013 161,242,681 50,590,248 Short-term municipal securities 139,405,000 117,850,000 16,800,000 61,600,000 =========================================================================================================
At October 31, 1999, the identified cost of investments owned for federal income tax purposes were as follows:
Investment Select Quality Premier Quality Quality Income Income - --------------------------------------------------------------------------------------------------------- $792,353,145 $766,431,610 $1,188,077,659 $444,065,37 =========================================================================================================
At October 31, 1999, the following Funds had unused capital loss carryforwards available for federal income tax purposes to be applied against future capital gains, if any. If not applied the carryforwards will expire as follows:
Select Quality Premier Quality Income Income - --------------------------------------------------------------------------------------------------------- Expiration year: 2003 $ -- $162,599 $ -- 2004 119,959 486,077 -- 2005 260,112 -- -- 2006 -- -- -- 2007 -- -- 103,628 - --------------------------------------------------------------------------------------------------------- Total $380,071 $648,676 $103,628 =========================================================================================================
5. UNREALIZED APPRECIATION (DEPRECIATION) Gross unrealized appreciation and gross unrealized depreciation of investments for federal income tax purposes at October 31, 1999, were as follows:
Investment Select Quality Premier Quality Quality Income Income - --------------------------------------------------------------------------------------------------------- Gross unrealized: appreciation $25,823,780 $24,147,210 $52,055,203 $18,666,518 depreciation (23,809,949) (21,326,213) (31,044,298) (12,398,531) - ---------------------------------------------------------------------------------------------------------- Net unrealized appreciation $ 2,013,831 $ 2,820,997 $21,010,905 $ 6,267,987 =========================================================================================================
6. MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATES Under the Funds' investment management agreements with Nuveen Advisory Corp. (the "Adviser"), a wholly owned subsidiary of The John Nuveen Company, each Fund pays an annual management fee, payable monthly, at the rates set forth below, which are based upon the average daily net asset value of each Fund as follows: Average Daily Net Asset Value Management Fee - -------------------------------------------------------------------------------- For the first $125 million .6500 of 1% For the next $125 million .6375 of 1 For the next $250 million .6250 of 1 For the next $500 million .6125 of 1 For the next $1 billion .6000 of 1 For net assets over $2 billion .5875 of 1 ================================================================================ The fee compensates the Adviser for overall investment advisory and administrative services and general office facilities. The Funds pay no compensation directly to those of its Directors who are affiliated with the Adviser or to their officers, all of whom receive remuneration for their services to the Funds from the Adviser. 7. COMPOSITION OF NET ASSETS At October 31, 1999, net assets consisted of:
Investment Select Quality Premier Quality Quality Income Income - --------------------------------------------------------------------------------------------------------------- Preferred shares, $25,000 stated value per share, at liquidation value $301,000,000 $279,000,000 $452,000,000 $165,000,000 Common shares, $.01 par value per share 357,490 338,875 542,045 200,520 Paid-in surplus 498,212,450 471,917,493 754,997,841 278,498,977 Balance of undistributed net investment income 759,320 1,404,794 943,351 645,422 Accumulated net realized gain (loss) from investment transactions 165,387 (443,038) (1,125,121) (103,628) Net unrealized appreciation of investments 2,013,831 2,883,964 21,487,350 6,267,987 - --------------------------------------------------------------------------------------------------------------- Net assets $802,508,478 $755,102,088 $1,228,845,466 $450,509,278 - --------------------------------------------------------------------------------------------------------------- Authorized shares: Common 200,000,000 200,000,000 200,000,000 200,000,000 Preferred 1,000,000 1,000,000 1,000,000 1,000,000 ===============================================================================================================
8. INVESTMENT COMPOSITION At October 31, 1999, the revenue sources by municipal purpose, expressed as a percent of long-term investments, were as follows:
Investment Select Quality Premier Quality Quality Income Income - --------------------------------------------------------------------------------------------------------- Education and Civic Organizations 3% 2% 1% 5% Health Care 14 7 7 9 Housing/Multifamily 2 7 3 14 Housing/Single Family 11 7 10 6 Tax Obligation/General 4 10 9 9 Tax Obligation/Limited 6 7 4 11 Transportation 7 11 14 1 U.S. Guaranteed 29 28 32 Utilities 10 16 9 6 Water and Sewer 12 4 6 3 Other 2 1 3 4 - --------------------------------------------------------------------------------------------------------- 100% 100% 100% 100% =========================================================================================================
Certain long-term and intermediate-term investments owned by the Funds are either covered by insurance issued by several private insurers or are backed by an escrow or trust containing U.S. government or U.S. government agency securities, both of which ensure the timely payment of principal and interest in the event of default (67% for Investment Quality, 64% for Select Quality, 52% for Quality Income and 51% for Premier Income). For additional information regarding each investment security, refer to the Portfolio of Investments of each Fund. Financial Highlights Selected data for a Common share outstanding throughout each year:
Investment Operations --------------------- Net Realized/ Beginning Net Unrealized Net Asset Investment Investment Value Income Gain (Loss) Total - ----------------------------------------------------------------- Investment Quality Year Ended 10/31: 1999 $16.00 $1.21 $(1.96) $ (.75) 1998 15.77 1.22 .25 1.47 1997 15.48 1.25 .30 1.55 1996 15.65 1.29 (.17) 1.12 1995 14.65 1.33 1.04 2.37 Select Quality Year Ended 10/31: 1999 15.68 1.22 (1.64) (.42) 1998 15.48 1.23 .19 1.42 1997 15.12 1.25 .37 1.62 1996 15.29 1.27 (.17) 1.10 1995 14.03 1.30 1.30 2.60 Quality Income Year Ended 10/31: 1999 15.83 1.27 (1.48) (.21) 1998 15.73 1.27 .12 1.39 1997 15.44 1.29 .29 1.58 1996 15.43 1.30 .02 1.32 1995 14.20 1.31 1.26 2.57 Premier Income Year Ended 10/31: 1999 15.76 1.22 (1.51) (.29) 1998 15.62 1.22 .17 1.39 1997 15.38 1.25 .31 1.56 1996 15.34 1.27 .12 1.39 1995 14.08 1.28 1.34 2.62 Less Distributions ------------------ Net Net Investment Investment Capital Capital Income To Income To Gains To Gains To Common Preferred Common Preferred Share- Share- Share- Share- holders holders+ holders holders+ Total - -------------------------------------------------------------------------------- Investment Quality Year Ended 10/31: 1999 $ (.96) $ (.24) $ -- $-- $ (1.20) 1998 (.98) (.25) (.01) -- (1.24) 1997 (1.01) (.25) -- -- (1.26) 1996 (1.03) (.26) -- -- (1.29) 1995 (1.08) (.29) -- -- (1.37) Select Quality Year Ended 10/31: 1999 (.96) (.24) -- -- (1.20) 1998 (.97) (.25) -- -- (1.22) 1997 (1.01) (.25) -- -- (1.26) 1996 (1.01) (.26) -- -- (1.27) 1995 (1.05) (.29) -- -- (1.34) Quality Income Year Ended 10/31: 1999 (1.03) (.25) -- -- (1.28) 1998 (1.03) (.26) -- -- (1.29) 1997 (1.03) (.26) -- -- (1.29) 1996 (1.03) (.28) -- -- (1.31) 1995 (1.03) (.31) -- -- (1.34) Premier Income Year Ended 10/31: 1999 (.97) (.24) -- -- (1.21) 1998 (1.00) (.25) -- -- (1.25) 1997 (1.03) (.24) (.04) (.01) (1.32) 1996 (1.01) (.26) (.06) (.02) (1.35) 1995 (1.01) (.28) (.06) (.01) (1.36) Total Returns ---------------- Organization and Offering Costs and Based Preferred Ending Based on Share Net Ending on Net Underwriting Asset Market Market Asset Discounts Value Value Value* Value* - ------------------------------------------------------------------------------ Investment Quality Year Ended 10/31: 1999 $ (.02) $14.03 $13.3125 (8.51)% (6.64)% 1998 -- 16.00 15.5000 5.97 7.97 1997 -- 15.77 15.5625 10.82 8.68 1996 -- 15.48 15.0000 6.13 5.70 1995 -- 15.65 15.1250 21.89 14.71 Select Quality Year Ended 10/31: 1999 (.01) 14.05 13.1250 13.63) (4.55) 1998 -- 15.68 16.1875 10.96 7.77 1997 -- 15.48 15.5000 9.43 9.35 1996 -- 15.12 15.1250 9.71 5.71 1995 -- 15.29 14.7500 21.03 17.03 Quality Income Year Ended 10/31: 1999 (.01) 14.33 14.0000 (11.17) (3.20) 1998 -- 15.83 16.8125 9.64 7.37 1997 -- 15.73 16.3125 14.22 8.81 1996 -- 15.44 15.2500 10.61 6.93 1995 -- 15.43 14.7500 23.26 16.51 Premier Income Year Ended 10/31: 1999 (.02) 14.24 13.3125 (17.25) (3.71) 1998 -- 15.76 17.1250 10.29 7.49 1997 -- 15.62 16.5000 16.81 8.85 1996 -- 15.38 15.1250 11.00 7.51 1995 -- 15.34 14.6250 23.92 17.15 Ratios/Supplemental Data ------------------------------------------------------------------------- Before Credit ----------------------------------------------------------- Ratio of Net Ratio of Net Ratio of Investment Ratio of Investment Expenses Income to Expenses Income to to Average Average to Average Average Ending Net Assets Net Assets Total Total Net Applicable Applicable Net Assets Net Assets Assets to Common to Common Including Including (000) Shares++ Shares++ Preferred++ Preferred++ - ------------------------------------------------------------------------------------------- Investment Quality Year Ended 10/31: 1999 $802,508 1.17% 7.85% .77% 5.24% 1998 820,150 1.12 7.66 .78 5.31 1997 809,337 1.13 8.08 .78 5.56 1996 798,349 1.14 8.32 .78 5.71 1995 804,221 1.15 8.74 .78 5.97 Select Quality Year Ended 10/31: 1999 755,102 1.17 8.07 .78 5.39 1998 769,774 1.14 7.87 .78 5.40 1997 759,770 1.15 8.22 .78 5.59 1996 745,059 1.15 8.39 .78 5.69 1995 749,883 1.18 8.81 .79 5.91 Quality Income Year Ended 10/31: 1999 1,228,845 1.17 8.26 .77 5.47 1998 1,251,408 1.13 8.08 .77 5.49 1997 1,238,536 1.15 8.35 .77 5.62 1996 1,219,663 1.15 8.44 .77 5.67 1995 1,218,905 1.18 8.84 .78 5.86 Premier Income Year Ended 10/31: 1999 450,509 1.19 7.98 .79 5.35 1998 454,149 1.15 7.80 .79 5.38 1997 448,807 1.17 8.14 .80 5.57 1996 442,153 1.18 8.29 .81 5.66 1995 441,381 1.19 8.66 .80 5.84 - ------------------------------------------------------------------------------------------- Ratios/Supplemental Data ------------------------------------------------------------------------- After Credit** --------------------------------------------------------- Ratio of Net Ratio of Net Ratio of Investment Ratio of Investment Expenses Income to Expenses Income to to Average Average to Average Average Net Assets Net Assets Total Total Applicable Applicable Net Assets Net Assets Portfolio to Common to Common Including Including Turnover Shares++ Shares++ Preferred++ Preferred++ Rate - ----------------------------------------------------------------------------------------- Investment Quality Year Ended 10/31: 1999 1.16% 7.86% .77% 5.24% 16% 1998 1.12 7.66 .78 5.31 7 1997 1.13 8.08 .78 5.56 14 1996 1.14 8.32 .78 5.71 8 1995 1.15 8.74 .78 5.97 11 Select Quality Year Ended 10/31: 1999 1.16 8.08 .78 5.39 27 1998 1.14 7.87 .78 5.40 7 1997 1.15 8.22 .78 5.59 10 1996 1.15 8.39 .78 5.69 13 1995 1.18 8.81 .79 5.91 7 Quality Income Year Ended 10/31: 1999 1.16 8.27 .77 5.47 13 1998 1.13 8.08 .77 5.49 19 1997 1.15 8.35 .77 5.62 9 1996 1.15 8.44 .77 5.67 11 1995 1.18 8.84 .78 5.86 17 Premier Income Year Ended 10/31: 1999 1.18 7.99 .79 5.35 11 1998 1.15 7.80 .79 5.38 19 1997 1.17 8.14 .80 5.57 5 1996 1.18 8.29 .81 5.66 8 1995 1.19 8.66 .80 5.84 22 * Total Investment Return on Market Value is the combination of reinvested dividend income, reinvested capital gains distributions, if any, and changes in stock price per share. Total Return on Net Asset Value is the combination of reinvested dividend income, reinvested capital gains distributions, if any, and changes in net asset value per share. Total returns are not annualized. ** After custodian fee credit, where applicable (note 1). + The amounts shown are based on Common share equivalents. ++ Ratios do not reflect the effect of dividend payments to preferred shareholders; income ratios reflect income earned on assets attributable to Preferred shares.
Build Your Wealth Automatically Sidebar text: Nuveen offers a number of convenient ways to add to your portfolio and earn the tax-free income you need to achieve your financial goals. Nuveen makes reinvesting easy. A phone call is all it takes to set up your reinvestment account. NUVEEN EXCHANGE-TRADED FUNDS DIVIDEND REINVESTMENT PLAN Your Nuveen Exchange-Traded Fund allows you to conveniently reinvest dividends and/or capital gains distributions in additional fund shares. If you do not elect to reinvest distributions, all distributions are paid by check or can be deposited directly into your bank or brokerage account. By choosing to reinvest, you'll be able to invest money regularly and automatically, and watch your investment grow through the power of tax-free compounding. You'll also potentially benefit from dollar-cost averaging, a technique of investing at regular intervals, which allows you to build a high-quality, tax-free portfolio conveniently and cost effectively over time. To be effective, dollar cost averaging requires that you invest over a long period of time and does not assure that you will profit. EASY AND CONVENIENT To make recordkeeping easy and convenient, each month you'll receive a statement showing your total dividends and distributions, the date of investment, the shares acquired and the price per share, and the total number of shares you own. Income or capital gains taxes may be payable on dividends or distributions that are reinvested. HOW SHARES ARE PURCHASED The shares you acquire by reinvesting will either be purchased on the open market or newly issued by the Fund. If the shares are trading at or above net asset value at the time of valuation, the Fund will issue new shares at the then-current market price. If the shares are trading at less than net asset value, shares for your account will be purchased on the open market. Dividends and distributions received to purchase shares in the open market will normally be invested shortly after the dividend payment date. No interest will be paid on dividends and distributions awaiting reinvestment. Because the market price of shares may increase before purchases are completed, the average purchase price per share may exceed the market price at the time of valuation, resulting in the acquisition of fewer shares than if the dividend or distribution had been paid in shares issued by the fund. A pro rata portion of any applicable brokerage commissions on open market purchases will be paid by Plan participants. These commissions usually will be lower than those charged on individual transactions. FLEXIBILITY You may, of course, change your distribution option or withdraw from the Plan at any time, should your needs or situation change. Should you withdraw, you can receive a certificate for all whole shares credited to your reinvestment account and cash payment for fractional shares, or cash payment for all reinvestment account shares, less brokerage commissions and a $2.50 service fee. You can also reinvest if your shares are registered in the name of a brokerage firm, bank, or other nominee. Just ask your investment adviser if the firm will participate on your behalf. If not, it's easy to have the shares registered in your name and to apply for a reinvestment account directly. Participants whose shares are registered in the name of one firm may not be able to transfer the shares to another firm and continue to participate in the Plan. The Fund reserves the right to amend or terminate the Plan at any time. Although the Fund reserves the right to amend the Plan to include a service charge payable by the participants, there is no direct service charge to participants in the Plan at this time. For more information on the Nuveen Automatic Reinvestment Plan or to enroll in or withdraw from the Plan, speak with your financial adviser or call us at (800) 257-8787. Fund Information BOARD OF DIRECTORS Robert P. Bremner Lawrence H. Brown Anne E. Impellizzeri Peter R. Sawers William J. Schneider Timothy R. Schwertfeger Judith M. Stockdale FUND MANAGER Nuveen Advisory Corp. 333 West Wacker Drive Chicago, IL 60606 CUSTODIAN, TRANSFER AGENT AND SHAREHOLDER SERVICES The Chase Manhattan Bank 4 New York Plaza New York, NY 10004-2413 (800) 257-8787 LEGAL COUNSEL Morgan, Lewis & Bockius LLP Washington, D.C. INDEPENDENT AUDITORS Ernst & Young LLP Chicago, IL YEAR 2000 The concern that computer systems may have problems processing date-related information in the year 2000 and beyond has challenged businesses and organizations to thoroughly review all aspects of their operations. We have undertaken just such an approach at Nuveen in preparation for the millennium. Over the last 10 years, we have updated or replaced our trading, fund management, and pricing systems at Nuveen - systems that directly affect our investors and their financial advisers - to address Year 2000 concerns. We continue to work closely with our transfer agent, custodian, firms through whom we buy and sell portfolio securities, and other service partners to monitor the Year 2000 readiness of their systems, while addressing other remaining systems issues. In addition, the Funds hold securities of issuers whose business operations leave them susceptible to Year 2000 concerns. We seek to evaluate an issuer's Year 2000 readiness as part of our initial and ongoing research of these issuers. This is only one of the many factors considered in determining whether to buy, sell, or continue holding a particular security. Our Year 2000 review, repair, and testing program has been substantially completed. This program included industry-wide testing of critical systems and receipt of satisfactory assurances from critical service providers, vendors, and issuers regarding their Year 2000 readiness. We will continue more refined testing of our systems and their relationships with other parties' systems and will regularly discuss the results of this testing with those parties. We are also making Year 2000 contingency plans to guide recovery efforts in the event that, despite our remediation attempts, Year 2000 issues adversely affect the Funds. Although we can never have complete assurance that the steps we take will be sufficient to prevent any problems that would impact the Nuveen Exchange-Traded Funds, we can assure you that we will take all reasonable steps to prevent disruption of the services provided by your Fund. FUND POLICIES The Board of Trustees of your Fund recently modified certain investment policies of the Fund. The Fund was formerly not permitted to invest more than 5% of its total assets in Municipal Leases that contain "non-appropriation" clauses. In addition, your Fund was not permitted to invest more than 10% of its total assets in Municipal Leases and securities that are unmarketable, illiquid or not readily marketable. The Municipal Lease market has matured since the Fund's inception, and non-appropriation leases have become more liquid and widely accepted. The Nuveen Exchange-Traded Fund Board has eliminated the restrictions noted above, replacing them with requirements that the Funds limit investments in non-appropriation Municipal Leases to those that meet one or more of six criteria that indicate that the issuer will be motivated to continue to appropriate monies to make the payments under the Municipal Lease. The Board also eliminated the Fund's policy not to invest more than 5% of its total assets in unsecured obligations of issuers which, together with their predecessors, have been in operation for less than three years. Each fund intends to repurchase shares of its own common or preferred stock in the future at such times and in such amounts as is deemed advisable. No shares were repurchased during the 12-month period ended October 31, 1999. Any future repurchases will be reported to shareholders in the next annual or semiannual report. Photo of: John Nuveen, Sr. Serving Investors for Generations Since our founding in 1898, John Nuveen & Co. has been synonymous with investments that withstand the test of time. Today we offer a broad range of quality investments designed for individuals seeking to build and sustain wealth. In fact, more than 1.3 million investors have trusted Nuveen to help them pursue their financial goals. The cornerstone of Nuveen's investment philosophy is a commitment to disciplined long-term investment strategies focused on providing consistent, attractive performance over time - with moderated risk. We emphasize quality securities carefully chosen through in-depth research, and we follow those securities closely over time to ensure that they continue to meet our exacting standards. Whether your focus is long-term growth, dependable current income or sustaining accumulated wealth, Nuveen offers a wide variety of investments and services to help meet your unique circumstances and financial planning needs. Our equity, balanced, and tax-free income funds, along with our defined portfolios and private asset management, can help you build a better, well-diversified portfolio. Talk with your financial adviser to learn more about how Nuveen investment products and services can help you. Or call us at (800) 257-8787 for more information, including a prospectus where applicable. Please read that information carefully before investing. NUVEEN John Nuveen & Co. Incorporated 333 West Wacker Drive Chicago, IL 60606-1286 www.nuveen.com FAN-3-10-99 -----END PRIVACY-ENHANCED MESSAGE-----